Document_and_Entity_Informatio
Document and Entity Information | 3 Months Ended | |
Mar. 31, 2015 | Apr. 30, 2015 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | COMMUNITY WEST BANCSHARES / | |
Entity Central Index Key | 1051343 | |
Current Fiscal Year End Date | -19 | |
Entity Well-known Seasoned Issuer | No | |
Entity Voluntary Filers | No | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 8,204,158 | |
Document Fiscal Year Focus | 2015 | |
Document Fiscal Period Focus | Q1 | |
Document Type | 10-Q | |
Amendment Flag | FALSE | |
Document Period End Date | 31-Mar-15 |
CONSOLIDATED_BALANCE_SHEETS_un
CONSOLIDATED BALANCE SHEETS (unaudited) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Thousands, unless otherwise specified | ||
Assets: | ||
Cash and due from banks | $1,667 | $1,609 |
Federal funds sold | 22 | 22 |
Interest-earning demand in other financial institutions | 33,758 | 17,328 |
Cash and cash equivalents | 35,447 | 18,959 |
Money market investments | 99 | 99 |
Investment securities - available-for-sale, at fair value; amortized cost of $23,094 at March 31, 2015 and $22,141 at December 31, 2014 | 23,123 | 22,194 |
Investment securities - held-to-maturity, at amortized cost; fair value of $8,415 at March 31, 2015 and $8,894 at December 31, 2014 | 7,931 | 8,447 |
Federal Home Loan Bank stock, at cost | 1,716 | 1,716 |
Federal Reserve Bank stock, at cost | 1,373 | 1,373 |
Loans: | ||
Held for sale, at lower of cost or fair value | 63,724 | 66,759 |
Held for investment, net of allowance for loan losses of $7,275 at March 31, 2015 and $7,877 at December 31, 2014 | 422,077 | 420,497 |
Total loans | 485,801 | 487,256 |
Other assets acquired through foreclosure, net | 320 | 137 |
Premises and equipment, net | 3,018 | 3,053 |
Other assets | 13,443 | 14,084 |
Total assets | 572,271 | 557,318 |
Deposits: | ||
Non-interest-bearing demand | 71,278 | 57,364 |
Interest-bearing demand | 265,000 | 275,631 |
Savings | 15,283 | 15,265 |
Certificates of deposit ($250,000 or more) | 30,705 | 13,601 |
Other certificates of deposit | 113,404 | 115,223 |
Total deposits | 495,670 | 477,084 |
Other borrowings | 5,000 | 10,000 |
Other liabilities | 4,098 | 3,227 |
Total liabilities | 504,768 | 490,311 |
Stockholders' equity: | ||
Preferred stock - no par value, 10,000,000 shares authorized; 5,995 shares issued and outstanding at March 31, 2015 and 7,014 at December 31, 2014 | 5,995 | 7,014 |
Common stock - no par value, 20,000,000 shares authorized; 8,204,158 shares issued and outstanding at March 31, 2015 and 8,203,033 at December 31, 2014 | 42,001 | 41,957 |
Retained earnings | 19,490 | 18,005 |
Accumulated other comprehensive income (loss) | 17 | 31 |
Total stockholders' equity | 67,503 | 67,007 |
Total liabilities and stockholders' equity | $572,271 | $557,318 |
CONSOLIDATED_BALANCE_SHEETS_un1
CONSOLIDATED BALANCE SHEETS (unaudited) (Parenthetical) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Thousands, except Share data, unless otherwise specified | ||
Assets: | ||
Investment securities available-for-sale, amortized cost | $23,094 | $22,141 |
Investment securities held-to-maturity, fair value | 8,415 | 8,894 |
Loans: | ||
Loans held for investment, allowance for loan losses | $7,275 | $7,877 |
Stockholders' equity: | ||
Preferred stock, par value (in dollars per share) | $0 | $0 |
Preferred stock, shares authorized (in shares) | 10,000,000 | 10,000,000 |
Preferred stock, shares issued (in shares) | 5,595 | 7,014 |
Preferred stock, shares outstanding (in shares) | 5,595 | 7,014 |
Common stock, par value (in dollars per share) | $0 | $0 |
Common stock, shares authorized (in shares) | 20,000,000 | 20,000,000 |
Common stock, shares issued (in shares) | 8,204,158 | 8,203,033 |
Common stock, shares outstanding (in shares) | 8,204,158 | 8,203,033 |
CONSOLIDATED_INCOME_STATEMENTS
CONSOLIDATED INCOME STATEMENTS (unaudited) (USD $) | 3 Months Ended | |
In Thousands, except Per Share data, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Interest income: | ||
Loans, including fees | $6,712 | $6,761 |
Investment securities and other | 305 | 200 |
Total interest income | 7,017 | 6,961 |
Interest expense: | ||
Deposits | 605 | 642 |
Other borrowings and convertible debt | 61 | 237 |
Total interest expense | 666 | 879 |
Net interest income | 6,351 | 6,082 |
(Benefit) provision for loan losses | -968 | -1,371 |
Net interest income after provision for loan losses | 7,319 | 7,453 |
Non-interest income: | ||
Other loan fees | 175 | 175 |
Gains from loan sales, net | 36 | 65 |
Document processing fees | 92 | 78 |
Service charges | 73 | 72 |
Other | 104 | 128 |
Total non-interest income | 480 | 518 |
Non-interest expense: | ||
Salaries and employee benefits | 3,115 | 3,227 |
Occupancy, net | 445 | 439 |
Professional services | 248 | 360 |
Data processing | 119 | 172 |
Depreciation | 91 | 75 |
Loan servicing and collection | 89 | 265 |
Advertising and marketing | 80 | 121 |
Stock option | 42 | 211 |
FDIC assessment | 71 | 80 |
Net (gain) loss on sales/write-downs of foreclosed real estate and repossessed assets | -1 | 40 |
Other | 472 | 535 |
Total non-interest expenses | 4,771 | 5,525 |
Income before provision for income taxes | 3,028 | 2,446 |
Income taxes | 1,258 | 1,004 |
Net income | 1,770 | 1,442 |
Dividends on preferred stock | 140 | 273 |
Discount on partial redemption of preferred stock | -19 | 0 |
Net income available to common stockholders | $1,649 | $1,169 |
Earnings per share: | ||
Basic (in dollars per share) | $0.20 | $0.15 |
Diluted (in dollars per share) | $0.19 | $0.15 |
Weighted average number of common shares outstanding: | ||
Basic (in shares) | 8,203 | 7,971 |
Diluted (in shares) | 8,501 | 8,534 |
Dividends declared per common share (in dollars per share) | $0.02 | $0 |
CONSOLIDATED_STATEMENTS_OF_COM
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (unaudited) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (unaudited) [Abstract] | ||
Net income | $1,770 | $1,442 |
Other comprehensive income, net: | ||
Unrealized (loss) income on securities available-for-sale (AFS), net (tax effect of $10 and ($66)for each respective period presented) | -14 | 95 |
Net other comprehensive income | -14 | 95 |
Comprehensive income | $1,756 | $1,537 |
CONSOLIDATED_STATEMENTS_OF_COM1
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (unaudited) (Parenthetical) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Other comprehensive income, net: | ||
Unrealized (loss) income on securities available-for-sale (AFS), tax effect | $10 | ($66) |
CONSOLIDATED_STATEMENTS_OF_STO
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (unaudited) (USD $) | Preferred Stock [Member] | Common Stock [Member] | Accumulated Other Comprehensive Income (Loss) [Member] | Retained Earnings [Member] | Total |
In Thousands, except Share data, unless otherwise specified | |||||
Balance at Dec. 31, 2014 | $7,014 | $41,957 | $31 | $18,005 | $67,007 |
Balance (in shares) at Dec. 31, 2014 | 7,000 | 8,203,000 | 8,203,033 | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net income | 0 | 0 | 0 | 1,770 | 1,770 |
Exercise of stock options | 0 | 2 | 0 | 0 | 2 |
Exercise of stock options (in shares) | 1,000 | ||||
Stock option expense | 0 | 42 | 0 | 0 | 42 |
Preferred stock redemption and discount | -1,019 | 0 | 0 | 19 | -1,000 |
Preferred stock redemption and discount (in shares) | -1,000 | 0 | |||
Dividends on preferred stock | 0 | 0 | 0 | -140 | -140 |
Dividends on common stock | 0 | 0 | 0 | -164 | -164 |
Other comprehensive income, net | 0 | 0 | -14 | 0 | -14 |
Balance at Mar. 31, 2015 | $5,995 | $42,001 | $17 | $19,490 | $67,503 |
Balance (in shares) at Mar. 31, 2015 | 6,000 | 8,204,000 | 8,204,158 |
CONSOLIDATED_STATEMENTS_OF_CAS
CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Cash flows from operating activities: | ||
Net income | $1,770 | $1,442 |
Adjustments to reconcile net income to cash provided by operating activities: | ||
Provision for loan losses | -968 | -1,371 |
Depreciation | 91 | 75 |
Stock-based compensation | 42 | 211 |
Deferred income taxes | 283 | -142 |
Net accretion of discounts and premiums for investment securities | -75 | 2 |
(Gains)/Losses on: | ||
Sale of repossessed assets, net | -1 | 40 |
Sale of loans, net | -36 | -65 |
Sale of assets, net | 39 | 0 |
Loans originated for sale and principal collections, net | 3,071 | -1,467 |
Changes in: | ||
Other assets | 356 | 589 |
Other liabilities | 894 | 782 |
Servicing rights, net | 2 | 66 |
Net cash provided by operating activities | 5,468 | 162 |
Cash flows from investing activities: | ||
Principal pay downs and maturities of available-for-sale securities | 4,549 | 407 |
Purchase of available-for-sale securities | -5,422 | -1,965 |
Proceeds from principal pay downs and maturities of securities held-to-maturity | 511 | 275 |
Loan originations and principal collections, net | -834 | -8,618 |
Liquidation of restricted stock, net | 0 | 225 |
Purchase of premises and equipment, net | -95 | -34 |
Proceeds from sale of other real estate owned and repossessed assets, net | 40 | 393 |
Net cash (used in) provided by investing activities | -1,251 | -9,317 |
Cash flows from financing activities: | ||
Net increase (decrease) in deposits | 18,586 | 10,390 |
Net decrease in borrowings | -5,000 | -34 |
Exercise of stock options | 2 | 1 |
Cash dividends paid on common stock | -164 | 0 |
Redemption of preferred stock | -1,000 | 0 |
Cash dividends paid on preferred stock | -153 | -1,630 |
Net cash provided by financing activities | 12,271 | 8,727 |
Net (decrease) increase in cash and cash equivalents | 16,488 | -428 |
Cash and cash equivalents at beginning of year | 18,959 | 19,478 |
Cash and cash equivalents at end of period | 35,447 | 19,050 |
Cash paid during the period for: | ||
Interest | 661 | 762 |
Income taxes | 0 | 0 |
Non-cash investing and financing activity: | ||
Transfers to other assets acquired through foreclosure, net | 223 | 403 |
Conversion of debentures | $0 | $1,408 |
SUMMARY_OF_SIGNIFICANT_ACCOUNT
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 3 Months Ended | ||
Mar. 31, 2015 | |||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [Abstract] | |||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||
Nature of operations | |||
Community West Bancshares ("CWBC"), incorporated under the laws of the state of California, is a bank holding company providing full service banking through its wholly-owned subsidiary Community West Bank, N.A. ("CWB" or the "Bank"). These entities are collectively referred to herein as the "Company." | |||
Basis of presentation | |||
The accounting and reporting policies of the Company are in accordance with accounting principles generally accepted in the United States ("GAAP") and conform to practices within the financial services industry. The accounts of the Company and its consolidated subsidiary are included in these Consolidated Financial Statements. All significant intercompany balances and transactions have been eliminated. | |||
Use of estimates | |||
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures 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 changes in the near term relate to the determination of the allowance for loan losses and fair value of other real estate owned. Although Management believes these estimates to be reasonably accurate, actual amounts may differ. In the opinion of Management, all adjustments considered necessary have been reflected in the financial statements during their preparation. | |||
Interim financial information | |||
The accompanying unaudited consolidated financial statements as of and for the three months ended March 31, 2015 and 2014 have been prepared in a condensed format, and therefore do not include all of the information and footnotes required by GAAP for complete financial statements. These statements have been prepared on a basis that is substantially consistent with the accounting principles applied to our audited consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2014. | |||
The information furnished in these interim statements reflects all adjustments which are, in the opinion of management, necessary for a fair statement of the results for each respective period presented. Such adjustments are of a normal recurring nature. The results of operations in the interim statements are not necessarily indicative of the results that may be expected for any other quarter or for the full year. The interim financial information should be read in conjunction with the Company's audited consolidated financial statements. | |||
Reclassifications | |||
Certain amounts in the consolidated financial statements as of December 31, 2014 and for the three months ended March 31, 2014 have been reclassified to conform to the current presentation. The reclassifications have no effect on net income, comprehensive income or stockholders' equity as previously reported. | |||
Loans Held For Sale | |||
Loans which are originated and intended for sale in the secondary market are carried at the lower of cost or estimated fair value determined on an aggregate basis. Valuation adjustments, if any, are recognized through a valuation allowance by charges to lower of cost or fair value provision. Loans held for sale are mostly comprised of SBA, commercial agriculture and single family residential loans. The Company did not incur any lower of cost or fair value provision in the three months ended March 31, 2015 and 2014. | |||
Loans Held for Investment and Interest and Fees from Loans | |||
Loans are recognized at the principal amount outstanding, net of unearned income, loan participations and amounts charged off. Unearned income includes deferred loan origination fees reduced by loan origination costs. Unearned income on loans is amortized to interest income over the life of the related loan using the level yield method. | |||
Interest income on loans is accrued daily using the effective interest method and recognized over the terms of the loans. Loan fees collected for the origination of loans less direct loan origination costs (net deferred loan fees) are amortized over the contractual life of the loan through interest income. If the loan has scheduled payments, the amortization of the net deferred loan fee is calculated using the interest method over the contractual life of the loan. If the loan does not have scheduled payments, such as a line of credit, the net deferred loan fee is recognized as interest income on a straight-line basis over the contractual life of the loan commitment. Commitment fees based on a percentage of a customer's unused line of credit and fees related to standby letters of credit are recognized over the commitment period. | |||
When loans are repaid, any remaining unamortized balances of unearned fees, deferred fees and costs and premiums and discounts paid on purchased loans are accounted for through interest income. | |||
Nonaccrual loans: For all loan types, when a borrower discontinues making payments as contractually required by the note, the Company must determine whether it is appropriate to continue to accrue interest. Generally, the Company places loans in a nonaccrual status and ceases recognizing interest income when the loan has become delinquent by more than 90 days or when Management determines that the full repayment of principal and collection of interest is unlikely. The Company may decide to continue to accrue interest on certain loans more than 90 days delinquent if they are well secured by collateral and in the process of collection. Other personal loans are typically charged off no later than 180 days delinquent. | |||
For all loan types, when a loan is placed on nonaccrual status, all interest accrued but uncollected is reversed against interest income in the period in which the status is changed. Subsequent payments received from the customer are applied to principal and no further interest income is recognized until the principal has been paid in full or until circumstances have changed such that payments are again consistently received as contractually required. The Company occasionally recognizes income on a cash basis for non-accrual loans in which the collection of the remaining principal balance is not in doubt. | |||
Impaired loans: A loan is considered impaired when, based on current information; it is probable that the Company will be unable to collect the scheduled payments of principal and/or interest under the contractual terms of the loan agreement. Factors considered by management in determining impairment include payment status, collateral value and the probability of collecting scheduled principal and/or interest payments. Loans that experience insignificant payment delays or payment shortfalls generally are not classified as impaired. Management determines the significance of payment delays or payment shortfalls on a case-by-case basis. When determining the possibility of impairment, management considers the circumstances surrounding the loan and the borrower, including the length of the delay, the reasons for the delay, the borrower's prior payment record and the amount of the shortfall in relation to the principal and interest owed. For collateral-dependent loans, the Company uses the fair value of collateral method to measure impairment. The collateral-dependent loans that recognize impairment are charged down to the fair value less costs to sell. All other loans are measured for impairment either based on the present value of future cash flows or the loan's observable market price. | |||
Troubled debt restructured loan ("TDR"): A TDR is a loan on which the Company, for reasons related to the borrower's financial difficulties, grants a concession to the borrower that the Company would not otherwise consider. These concessions included but are not limited to term extensions, rate reductions and principal reductions. Forgiveness of principal is rarely granted and modifications for all classes of loans are predominately term extensions. A TDR loan is also considered impaired. Generally, a loan that is modified at an effective market rate of interest may no longer be disclosed as a troubled debt restructuring in years subsequent to the restructuring if it is not impaired based on the terms specified by the restructuring agreement. | |||
Allowance for Loan Losses and Provision for Credit Losses | |||
The Company maintains a detailed, systematic analysis and procedural discipline to determine the amount of the allowance for loan losses ("ALL"). The ALL is based on estimates and is intended to be appropriate to provide for probable losses inherent in the loan portfolio. This process involves deriving probable loss estimates that are based on migration analysis and historical loss rates, in addition to qualitative factors that are based on management's judgment. The migration analysis and historical loss rate calculations are based on the annualized loss rates utilizing a twelve-quarter loss history. Migration analysis is utilized for the Commercial Real Estate ("CRE"), Commercial, Commercial Agriculture, Small Business Administration ("SBA"), Home Equity Line of Credit ("HELOC"), Single Family Residential, and Consumer portfolios. The historical loss rate method is utilized primarily for the Manufactured Housing portfolio. The migration analysis takes into account the risk rating of loans that are charged off in each loan category. Loans that are considered Doubtful are typically charged off. The following is a description of the characteristics of loan ratings. Loan ratings are reviewed as part of our normal loan monitoring process, but, at a minimum, updated on an annual basis. | |||
Outstanding – This is the highest quality rating that is assigned to any loan in the portfolio. These loans are made to the highest quality borrowers with strong financial statements and unquestionable repayment sources. Collateral securing these types of credits are generally cash deposits in the bank or marketable securities held in custody. | |||
Good – Loans rated in this category are strong loans, underwritten well, that bear little risk of loss to the Company. Loans in this category are loans to quality borrowers with very good financial statements that present an identifiable strong primary source and good secondary source of repayment. Generally, these credits are well collateralized by good quality and liquid assets or low loan to value market real estate. | |||
Pass - Loans rated in this category are acceptable loans, appropriately underwritten, bearing an ordinary risk of loss to the Company. Loans in this category are loans to quality borrowers with financial statements presenting a good primary source as well as an adequate secondary source of repayment. In the case of individuals, borrowers with this rating are quality borrowers demonstrating a reasonable level of secure income, a net worth adequate to support the loan and presenting a good primary source as well as an adequate secondary source of repayment. | |||
Watch – Acceptable credit that requires a temporary increase in attention by management. This can be caused by declines in sales, margins, liquidity or working capital. Generally the primary weakness is lack of current financial statements and industry issues. | |||
Special Mention - A Special Mention loan has potential weaknesses that require management's close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or in the institution's credit position at some future date. Special mention assets are not adversely classified and do not expose an institution to sufficient risk to warrant adverse classification. | |||
Substandard - 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. These loans have a well-defined weakness or weaknesses that jeopardize full collection of amounts due. They are characterized by the distinct possibility that the Company will sustain some loss if the borrower's deficiencies are not corrected. | |||
Doubtful - A loan classified Doubtful has all the weaknesses inherent in one classified Substandard with 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. The possibility of loss is extremely high, but because of certain important and reasonably specific pending factors, which may work to the advantage and strengthening of the loan, its classification as an estimated loss is deferred until its more exact status may be determined. Pending factors include proposed merger, acquisition or liquidation procedures, capital injection, perfecting liens on additional collateral and refinancing plans. | |||
Loss - Loans classified Loss are considered uncollectible and of such little value that their continuance as bankable loans is not warranted. This classification does not mean that the asset has absolutely no recovery or salvage value, but rather it is not practical or desirable to defer writing off this loan even though partial recovery may be realized in the future. Losses are taken in the period in which they are considered uncollectible. | |||
The Company's ALL is maintained at a level believed appropriate by management to absorb known and inherent probable losses on existing loans. The allowance is charged for losses when management believes that full recovery on the loan is unlikely. The following is the Company's policy regarding charging off loans. | |||
Commercial, CRE and SBA Loans | |||
Charge-offs on these loan categories are taken as soon as all or a portion of any loan balance is deemed to be uncollectible. A loan is considered impaired when, based on current information, it is probable that the Company will be unable to collect the scheduled payments of principal and/or interest under the contractual terms of the loan agreement. Factors considered by management in determining impairment include payment status, collateral value and the probability of collecting scheduled principal and/or interest payments. Loans that experience insignificant payment delays or payment shortfalls generally are not classified as impaired. Generally, loan balances are charged-down to the fair value of the collateral, if, based on a current assessment of the value, an apparent deficiency exists. In the event there is no perceived equity, the loan is charged-off in full. Unsecured loans which are delinquent over 90 days are also charged-off in full. | |||
Single Family Real Estate, HELOC's and Manufactured Housing Loans | |||
Consumer loans and residential mortgages secured by one-to-four family residential properties, HELOC and manufactured housing loans in which principal or interest is due and unpaid for 90 days, are evaluated for impairment. Loan balances are charged-off to the fair value of the property, less estimated selling costs, if, based on a current appraisal, an apparent deficiency exists. In the event there is no perceived equity, the loan is generally fully charged-off. Other consumer loans which are not secured and unpaid over 90-120 days are charged-off in full. | |||
Consumer Loans | |||
All consumer loans (excluding real estate mortgages, HELOCs and savings secured loans) are charged-off or charged-down to net recoverable value before becoming 120 days or five payments delinquent. | |||
The ALL calculation for the different loan portfolios is as follows: | |||
· | Commercial Real Estate, Commercial, Commercial Agriculture, SBA, HELOC, Single Family Residential, and Consumer – Migration analysis combined with risk rating is used to determine the required ALL for all non-impaired loans. In addition, the migration results are adjusted based upon qualitative factors that affect this specific portfolio category. Reserves on impaired loans are determined based upon the individual characteristics of the loan. | ||
· | Manufactured Housing – The ALL is calculated on the basis of loss history and risk rating, which is primarily a function of delinquency. In addition, the loss results are adjusted based upon qualitative factors that affect this specific portfolio. | ||
The Company evaluates and individually assesses for impairment loans generally greater than $500,000, classified as substandard or doubtful in addition to loans either on nonaccrual, considered a TDR or when other conditions exist which lead management to review for possible impairment.  Measurement of impairment on impaired loans is determined on a loan-by-loan basis and in total establishes a specific reserve for impaired loans. The amount of impairment is determined by comparing the recorded investment in each loan with its value measured by one of three methods: | |||
· | The expected future cash flows are estimated and then discounted at the effective interest rate. | ||
· | The value of the underlying collateral net of selling costs. Selling costs are estimated based on industry standards, the Company's actual experience or actual costs incurred as appropriate. When evaluating real estate collateral, the Company typically uses appraisals or valuations, no more than twelve months old at time of evaluation. When evaluating non-real estate collateral securing the loan, the Company will use audited financial statements or appraisals no more than twelve months old at time of evaluation. Additionally, for both real estate and non-real estate collateral, the Company may use other sources to determine value as deemed appropriate. | ||
· | The loan's observable market price. | ||
Interest income is not recognized on impaired loans except for limited circumstances in which a loan, although impaired, continues to perform in accordance with the loan contract and the borrower provides financial information to support maintaining the loan on accrual. | |||
The Company determines the appropriate ALL on a monthly basis. Any differences between estimated and actual observed losses from the prior month are reflected in the current period in determining the appropriate ALL determination and adjusted as deemed necessary. The review of the appropriateness of the allowance takes into consideration such factors as concentrations of credit, changes in the growth, size and composition of the loan portfolio, overall and individual portfolio quality, review of specific problem loans, collateral, guarantees and economic and environmental conditions that may affect the borrowers' ability to pay and/or the value of the underlying collateral. Additional factors considered include: geographic location of borrowers, changes in the Company's product-specific credit policy and lending staff experience. These estimates depend on the outcome of future events and, therefore, contain inherent uncertainties. | |||
Another component of the ALL considers qualitative factors related to non-impaired loans. The qualitative portion of the allowance on each of the loan pools is based on the following factors: | |||
· | Concentrations of credit | ||
· | International risk | ||
· | Trends in volume, maturity, and composition | ||
· | Volume and trend in delinquency | ||
· | Economic conditions | ||
· | Outside exams | ||
· | Geographic distance | ||
· | Policy and changes | ||
· | Staff experience and ability | ||
Off Balance Sheet and Credit Exposure | |||
In the ordinary course of business, the Company has entered into off-balance sheet financial instruments consisting of commitments to extend credit and standby letters of credit. Such financial instruments are recorded in the consolidated financial statements when they are funded. They involve, to varying degrees, elements of credit risk in excess of amounts recognized in the consolidated balance sheets. Losses would be experienced when the Company is contractually obligated to make a payment under these instruments and must seek repayment from the borrower, which may not be as financially sound in the current period as they were when the commitment was originally made. Commitments to extend credit are agreements to lend to a customer as long as there is no violation of any condition established in the contract. Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. The Company enters into credit arrangements that generally provide for the termination of advances in the event of a covenant violation or other event of default. Since many 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 party. The commitments are collateralized by the same types of assets used as loan collateral. | |||
As with outstanding loans, the Company applies qualitative factors and utilization rates to its off-balance sheet obligations in determining an estimate of losses inherent in these contractual obligations. The estimate for loan losses on off-balance sheet instruments is included within other liabilities and the charge to income that establishes this liability is include in non-interest expense. | |||
Foreclosed Real Estate and Repossessed Assets | |||
Foreclosed real estate and other repossessed assets are recorded at fair value at the time of foreclosure less estimated costs to sell. Any excess of loan balance over the fair value less estimated costs to sell of the other assets is charged-off against the allowance for loan losses. Any excess of the fair value less estimated costs to sell over the loan balance is recorded as a loan loss recovery to the extent of the loan loss previously charged-off against the allowance for loan losses; and, if greater, recorded as a gain on foreclosed assets. Subsequent to the legal ownership date, the Company periodically performs a new valuation and the asset is carried at the lower of carrying amount or fair value less estimated costs to sell. Operating expenses or income, and gains or losses on disposition of such properties, are recorded in current operations. | |||
Income Taxes | |||
The Company uses the asset and liability method, which recognizes an asset or liability representing the tax effects of future deductible or taxable amounts that have been recognized in the consolidated financial statements. Due to tax regulations, certain items of income and expense are recognized in different periods for tax return purposes than for financial statement reporting. These items represent "temporary differences." Deferred income taxes are recognized for the tax effect of temporary differences between the tax basis of assets and liabilities and their financial reporting amounts at each period end based on enacted tax laws and statutory tax rates applicable to the periods in which the differences are expected to affect taxable income. A valuation allowance is established for deferred tax assets if, based on weight of available evidence, it is more likely than not that some portion or all of the deferred tax assets may not be realized. Any interest or penalties assessed by the taxing authorities is classified in the financial statements as income tax expense. Deferred tax assets are included in other assets on the consolidated balance sheets. | |||
Management evaluates the Company's deferred tax asset for recoverability using a consistent approach which considers the relative impact of negative and positive evidence, including the Company's historical profitability and projections of future taxable income. The Company is required to establish a valuation allowance for deferred tax assets and record a charge to income if management determines, based on available evidence at the time the determination is made, that it is more likely than not that some portion or all of the deferred tax assets may not be realized. | |||
The Company is subject to the provisions of ASC 740, Income Taxes ("ASC 740"). ASC 740 prescribes a more-likely-than-not threshold for the financial statement recognition of uncertain tax positions. ASC 740 clarifies the accounting for income taxes by prescribing a minimum recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. On a quarterly basis, the Company evaluates income tax accruals in accordance with ASC 740 guidance on uncertain tax positions. | |||
Earnings Per Share | |||
Basic earnings per common share is computed using the weighted average number of common shares outstanding for the period divided into the net income available to common shareholders. Diluted earnings per share include the effect of all dilutive potential common shares for the period. Potentially dilutive common shares include stock options and warrants. | |||
Recent Accounting Pronouncements | |||
In January 2014, the FASB issued guidance within ASU 2014-04, "Receivables - Troubled Debt Restructurings by Creditors: Reclassification of Residential Real Estate Collateralized Consumer Mortgage Loans upon Foreclosure." The amendments in ASU 2014-04, Subtopic 310-40, Receivables -Troubled Debt Restructurings by Creditors, clarify that an in-substance repossession or foreclosure occurs, and a creditor is considered to have received physical possession of residential real estate property collateralizing a consumer mortgage loan, upon either (1) the creditor obtaining legal title to the residential real estate property upon completion of a foreclosure, or (2) 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. Additionally, the amendments require interim and annual disclosure of both (1) the amount of foreclosed residential real estate property held by the creditor and (2) the recorded investment in consumer mortgage loans collateralized by residential real estate property that are in the process of foreclosure according to local requirements of the applicable jurisdiction.  ASC 2014-04 are effective for the Company using either a modified retrospective transition method or a prospective transition method for reporting periods beginning after December 15, 2014. The adoption of this standard did not have a material impact on the Company's consolidated financial statements. | |||
In May 2014, the FASB issued guidance codified within ASU 2014-09, "Revenue Recognition - Revenue from Contracts with Customers," which amends the guidance in former Topic 605, Revenue Recognition. The new revenue recognition standard will supersede virtually all revenue guidance in U.S. GAAP, including industry specific guidance. The guidance in this Update affects any entity that either enters into contracts with customers to transfer goods or services or enters into contracts for the transfer of nonfinancial assets, unless those contracts are within the scope of other standards. ASU 2014-09 is effective for the Company for annual reporting periods beginning after December 15, 2016. The Company may elect to apply the amendments of this Update using one of the following two methods: 1) retrospectively to each prior reporting period presented or 2) retrospectively with the cumulative effect of initially applying this Update recognized at the date of initial application. The Company is currently evaluating the impact of the provisions in this standard on the Company's consolidated financial statements. |
INVESTMENT_SECURITIES
INVESTMENT SECURITIES | 3 Months Ended | ||||||||||||||||||||||||||||||||||||||||
Mar. 31, 2015 | |||||||||||||||||||||||||||||||||||||||||
INVESTMENT SECURITIES [Abstract] | |||||||||||||||||||||||||||||||||||||||||
INVESTMENT SECURITIES | 2. INVESTMENT SECURITIES | ||||||||||||||||||||||||||||||||||||||||
The amortized cost and estimated fair value of investment securities are as follows: | |||||||||||||||||||||||||||||||||||||||||
31-Mar-15 | |||||||||||||||||||||||||||||||||||||||||
Gross | Gross | ||||||||||||||||||||||||||||||||||||||||
Amortized | Unrealized | Unrealized | Fair | ||||||||||||||||||||||||||||||||||||||
Cost | Gains | (Losses) | Value | ||||||||||||||||||||||||||||||||||||||
Securities available-for-sale | (in thousands) | ||||||||||||||||||||||||||||||||||||||||
U.S. government agency notes | $ | 9,340 | $ | 45 | $ | (53 | ) | $ | 9,332 | ||||||||||||||||||||||||||||||||
U.S. government agency collateralized mortgage obligations ("CMO") | 13,688 | 90 | (43 | ) | 13,735 | ||||||||||||||||||||||||||||||||||||
Equity securities: Farmer Mac class A stock | 66 | - | (10 | ) | 56 | ||||||||||||||||||||||||||||||||||||
Total | $ | 23,094 | $ | 135 | $ | (106 | ) | $ | 23,123 | ||||||||||||||||||||||||||||||||
Securities held-to-maturity | |||||||||||||||||||||||||||||||||||||||||
U.S. government agency MBS | $ | 7,931 | $ | 484 | $ | - | $ | 8,415 | |||||||||||||||||||||||||||||||||
Total | $ | 7,931 | $ | 484 | $ | - | $ | 8,415 | |||||||||||||||||||||||||||||||||
31-Dec-14 | |||||||||||||||||||||||||||||||||||||||||
Gross | Gross | ||||||||||||||||||||||||||||||||||||||||
Amortized | Unrealized | Unrealized | Fair | ||||||||||||||||||||||||||||||||||||||
Cost | Gains | (Losses) | Value | ||||||||||||||||||||||||||||||||||||||
Securities available-for-sale | (in thousands) | ||||||||||||||||||||||||||||||||||||||||
U.S. government agency notes | $ | 7,846 | $ | 65 | $ | (49 | ) | $ | 7,862 | ||||||||||||||||||||||||||||||||
U.S. government agency collateralized mortgage obligations ("CMO") | 14,229 | 73 | (31 | ) | 14,271 | ||||||||||||||||||||||||||||||||||||
Equity securities: Farmer Mac class A stock | 66 | - | (5 | ) | 61 | ||||||||||||||||||||||||||||||||||||
Total | $ | 22,141 | $ | 138 | $ | (85 | ) | $ | 22,194 | ||||||||||||||||||||||||||||||||
Securities held-to-maturity | |||||||||||||||||||||||||||||||||||||||||
U.S. government agency MBS | $ | 8,447 | $ | 447 | $ | - | $ | 8,894 | |||||||||||||||||||||||||||||||||
Total | $ | 8,447 | $ | 447 | $ | - | $ | 8,894 | |||||||||||||||||||||||||||||||||
At March 31, 2015 and December 31, 2014, $31.0 million and $30.6 million of securities at carrying value, respectively, were pledged to the Federal Home Loan Bank ("FHLB"), as collateral for current and future advances. | |||||||||||||||||||||||||||||||||||||||||
The maturity periods and weighted average yields of investment securities at March 31, 2015 and December 31, 2014 were as follows: | |||||||||||||||||||||||||||||||||||||||||
31-Mar-15 | |||||||||||||||||||||||||||||||||||||||||
Less than One Year | One to Five Years | Five to Ten Years | Over Ten Years | Total | |||||||||||||||||||||||||||||||||||||
Amount | Yield | Amount | Yield | Amount | Yield | Amount | Yield | Amount | Yield | ||||||||||||||||||||||||||||||||
Securities available-for-sale | (dollars in thousands) | ||||||||||||||||||||||||||||||||||||||||
U.S. government agency notes | $ | 7,074 | 2.6 | % | $ | - | - | $ | 2,258 | 0.9 | % | $ | - | - | $ | 9,332 | 2.2 | % | |||||||||||||||||||||||
U.S. government agency CMO | 448 | 0.6 | % | 6,916 | 1.1 | % | 2,736 | 0.6 | % | 3,635 | 1.1 | % | 13,735 | 1 | % | ||||||||||||||||||||||||||
Farmer Mac class A stock | - | - | - | - | - | - | - | - | 56 | - | |||||||||||||||||||||||||||||||
Total | $ | 7,522 | 2.4 | % | $ | 6,916 | 1.1 | % | $ | 4,994 | 0.7 | % | $ | 3,635 | 1.1 | % | $ | 23,123 | 1.3 | % | |||||||||||||||||||||
Securities held-to-maturity | |||||||||||||||||||||||||||||||||||||||||
U.S. government agency MBS | $ | - | - | $ | 5,344 | 3.3 | % | $ | 2,587 | 2.2 | % | $ | - | - | $ | 7,931 | 3 | % | |||||||||||||||||||||||
Total | $ | - | - | $ | 5,344 | 3.3 | % | $ | 2,587 | 2.2 | % | $ | - | - | $ | 7,931 | 3 | % | |||||||||||||||||||||||
31-Dec-14 | |||||||||||||||||||||||||||||||||||||||||
Less than One Year | One to Five Years | Five to Ten Years | Over Ten Years | Total | |||||||||||||||||||||||||||||||||||||
Amount | Yield | Amount | Yield | Amount | Yield | Amount | Yield | Amount | Yield | ||||||||||||||||||||||||||||||||
Securities available-for-sale | (dollars in thousands) | ||||||||||||||||||||||||||||||||||||||||
U.S. government agency notes | $ | 7,862 | 2.5 | % | $ | - | - | $ | - | - | $ | - | - | $ | 7,862 | 2.5 | % | ||||||||||||||||||||||||
U.S. government agency CMO | - | - | 7,826 | 1 | % | 2,801 | 0.6 | % | 3,644 | 1.1 | % | 14,271 | 1.1 | % | |||||||||||||||||||||||||||
Farmer Mac class A stock | - | - | - | - | - | - | - | - | 61 | - | |||||||||||||||||||||||||||||||
Total | $ | 7,862 | 2.5 | % | $ | 7,826 | 1 | % | $ | 2,801 | 0.6 | % | $ | 3,644 | 1.1 | % | $ | 22,194 | 1.3 | % | |||||||||||||||||||||
Securities held-to-maturity | |||||||||||||||||||||||||||||||||||||||||
U.S. government agency MBS | $ | - | - | $ | 3,235 | 4 | % | $ | 5,212 | 2.4 | % | $ | - | - | $ | 8,447 | 2.9 | % | |||||||||||||||||||||||
Total | $ | - | - | $ | 3,235 | 4 | % | $ | 5,212 | 2.4 | % | $ | - | - | $ | 8,447 | 2.9 | % | |||||||||||||||||||||||
The amortized cost and fair value of investment securities by contractual maturities as of the periods presented were as shown below: | |||||||||||||||||||||||||||||||||||||||||
March 31, | December 31, | ||||||||||||||||||||||||||||||||||||||||
2015 | 2014 | ||||||||||||||||||||||||||||||||||||||||
Amortized | Estimated | Amortized | Estimated | ||||||||||||||||||||||||||||||||||||||
Cost | Fair Value | Cost | Fair Value | ||||||||||||||||||||||||||||||||||||||
Securities available for sale | (in thousands) | ||||||||||||||||||||||||||||||||||||||||
Due in one year or less | $ | 7,519 | $ | 7,522 | $ | 7,846 | $ | 7,862 | |||||||||||||||||||||||||||||||||
After one year through five years | 6,872 | 6,916 | 7,798 | 7,826 | |||||||||||||||||||||||||||||||||||||
After five years through ten years | 5,001 | 4,994 | 2,792 | 2,801 | |||||||||||||||||||||||||||||||||||||
After ten years | 3,636 | 3,635 | 3,639 | 3,644 | |||||||||||||||||||||||||||||||||||||
Farmer Mac class A stock | 66 | 56 | 66 | 61 | |||||||||||||||||||||||||||||||||||||
$ | 23,094 | $ | 23,123 | $ | 22,141 | $ | 22,194 | ||||||||||||||||||||||||||||||||||
Securities held to maturity | |||||||||||||||||||||||||||||||||||||||||
Due in one year or less | $ | - | $ | - | $ | - | $ | - | |||||||||||||||||||||||||||||||||
After one year through five years | 5,344 | 5,697 | 3,235 | 3,479 | |||||||||||||||||||||||||||||||||||||
After five years through ten years | 2,587 | 2,718 | 5,212 | 5,415 | |||||||||||||||||||||||||||||||||||||
After ten years | - | - | - | - | |||||||||||||||||||||||||||||||||||||
$ | 7,931 | $ | 8,415 | $ | 8,447 | $ | 8,894 | ||||||||||||||||||||||||||||||||||
Actual maturities may differ from contractual maturities as borrowers or issuers have the right to prepay or call the investment securities. Changes in interest rates may also impact prepayments. | |||||||||||||||||||||||||||||||||||||||||
The following tables show all securities that are in an unrealized loss position: | |||||||||||||||||||||||||||||||||||||||||
31-Mar-15 | |||||||||||||||||||||||||||||||||||||||||
Less Than Twelve Months | More Than Twelve Months | Total | |||||||||||||||||||||||||||||||||||||||
Gross | Gross | Gross | |||||||||||||||||||||||||||||||||||||||
Unrealized | Fair | Unrealized | Fair | Unrealized | Fair | ||||||||||||||||||||||||||||||||||||
Losses | Value | Losses | Value | Losses | Value | ||||||||||||||||||||||||||||||||||||
Securities available-for-sale | (in thousands) | ||||||||||||||||||||||||||||||||||||||||
U.S. government agency notes | $ | 53 | $ | 5,348 | $ | - | $ | - | $ | 53 | $ | 5,348 | |||||||||||||||||||||||||||||
U.S. government agency CMO | - | - | 43 | 3,895 | 43 | 3,895 | |||||||||||||||||||||||||||||||||||
Equity securities: Farmer Mac class A stock | 10 | 56 | - | - | 10 | 56 | |||||||||||||||||||||||||||||||||||
$ | 63 | $ | 5,404 | $ | 43 | $ | 3,895 | $ | 106 | $ | 9,299 | ||||||||||||||||||||||||||||||
Securities held-to-maturity | |||||||||||||||||||||||||||||||||||||||||
U.S. Government-agency MBS | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | |||||||||||||||||||||||||||||
Total | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | |||||||||||||||||||||||||||||
31-Dec-14 | |||||||||||||||||||||||||||||||||||||||||
Less Than Twelve Months | More Than Twelve Months | Total | |||||||||||||||||||||||||||||||||||||||
Gross | Gross | Gross | |||||||||||||||||||||||||||||||||||||||
Unrealized | Fair | Unrealized | Fair | Unrealized | Fair | ||||||||||||||||||||||||||||||||||||
Losses | Value | Losses | Value | Losses | Value | ||||||||||||||||||||||||||||||||||||
Securities available-for-sale | (in thousands) | ||||||||||||||||||||||||||||||||||||||||
U.S. government agency notes | $ | 23 | $ | 1,918 | $ | 26 | $ | 3,971 | $ | 49 | $ | 5,889 | |||||||||||||||||||||||||||||
U.S. government agency CMO | - | - | 31 | 4,090 | 31 | 4,090 | |||||||||||||||||||||||||||||||||||
Equity securities: Farmer Mac class A stock | 5 | 61 | - | - | 5 | 61 | |||||||||||||||||||||||||||||||||||
$ | 28 | $ | 1,979 | $ | 57 | $ | 8,061 | $ | 85 | $ | 10,040 | ||||||||||||||||||||||||||||||
Securities held-to-maturity | |||||||||||||||||||||||||||||||||||||||||
U.S. Government-agency MBS | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | |||||||||||||||||||||||||||||
Total | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | |||||||||||||||||||||||||||||
As of March 31, 2015 and December 31, 2014, there were six securities in an unrealized loss position. | |||||||||||||||||||||||||||||||||||||||||
Declines in the fair value of held-to-maturity and available-for-sale securities below their cost that are deemed to be other than temporary are reflected in earnings as realized losses. In estimating other-than-temporary impairment losses, management considers, among other things (i) the length of time and the extent to which the fair value has been less than cost (ii) the financial condition and near-term prospects of the issuer and (iii) the Company's intent to sell an impaired security and if it is not more likely than not it will be required to sell the security before the recovery of its amortized basis. | |||||||||||||||||||||||||||||||||||||||||
The unrealized losses are primarily due to increases in market interest rates over the yields available at the time the underlying securities were purchased. The fair value is expected to recover as the bonds approach their maturity date, repricing date or if market yields for such investments decline. Management does not believe any of the securities are impaired due to reasons of credit quality. Accordingly, as of March 31, 2015 and December 31, 2014, management believes the impairments detailed in the table above are temporary and no other-than-temporary impairment loss has been realized in the Company's consolidated income statements. |
LOAN_SALES_AND_SERVICING
LOAN SALES AND SERVICING | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
LOAN SALES AND SERVICING [Abstract] | |||||||||
LOAN SALES AND SERVICING | 3. LOAN SALES AND SERVICING | ||||||||
SBA and Agriculture Loans | |||||||||
The Company periodically sells the guaranteed portion of selected SBA loans into the secondary market, on a servicing-retained basis. The Company retains the unguaranteed portion of these loans and services the loans as required under the SBA programs to retain specified yield amounts. | |||||||||
On certain SBA loan sales, the Company retained interest only strips ("I/O strips"), which represent the present value of excess net cash flows generated by the difference between (a) interest at the stated rate paid by borrowers and (b) the sum of (i) pass-through interest paid to third-party investors and (ii) contractual servicing fees. The fair value is determined on a quarterly basis through a discounted cash flow analysis prepared by an independent third party using industry prepayment speeds. | |||||||||
Historically, the Company elected to use the amortizing method for the treatment of servicing assets and measured for impairment on a quarterly basis through a discounted cash flow analysis prepared by an independent third party using industry prepayment speeds. In connection with the sale of a group of SBA loans, the Company recorded a servicing asset and elected to measure this asset at fair value in accordance with ASC 825-10 – Fair Value Option to better reflect the impact of subsequent changes in interest rates. | |||||||||
The SBA program stipulates that the Company retains a minimum of 5% of the loan balance, which is unguaranteed. The percentage of each unguaranteed loan in excess of 5% may be periodically sold to a third party, typically for a cash premium. The Company records servicing liabilities for the sold unguaranteed loans. These servicing liabilities are calculated based on the present value of the estimated future servicing costs associated with each loan. The balance of the remaining servicing liabilities at March 31, 2015 was not material to the Company's financial position or results of operations. | |||||||||
The Company may also periodically sell certain SBA loans into the secondary market, on a servicing-released basis, typically for a cash premium. As of March 31, 2015 and December 31, 2014, the Company had approximately $37.6 million and $40.8 million, respectively, of SBA loans included in loans held for sale. As of March 31, 2015 and December 31, 2014, the principal balance of SBA loans serviced for others was $22.8 million and $24.6 million, respectively. | |||||||||
The Company's agricultural lending program includes loans for agricultural land, agricultural operational lines, and agricultural term loans for crops, equipment and livestock. The primary products are supported by guarantees issued from the USDA, FSA, and the USDA Business and Industry loan program. | |||||||||
As of March 31, 2015 and December 31, 2014, the Company had $25.3 million and $25.1 million, respectively, of USDA loans included in loans held for sale. As of March 31, 2015 and December 31, 2014, the principal balance of USDA loans serviced for others was $1.4 million. | |||||||||
The following table presents the I/O strips activity as of the periods presented: | |||||||||
Three Months Ended | |||||||||
March 31, | |||||||||
2015 | 2014 | ||||||||
(in thousands) | |||||||||
Beginning balance | $ | 293 | $ | 334 | |||||
Adjustment to fair value | (7 | ) | - | ||||||
Ending balance | $ | 286 | $ | 334 | |||||
The fair value adjustments on the I/O strips are recorded in non-interest income. | |||||||||
The key data assumptions used in estimating the fair value of the I/O strips as of the periods presented were as follows: | |||||||||
March 31, | |||||||||
2015 | 2014 | ||||||||
Weighted-average constant prepayment rate | 5.64 | % | 5.29 | % | |||||
Weighted-average life (in years) | 6 | 6 | |||||||
Weighted-average discount rate | 10.35 | % | 11.89 | % | |||||
A sensitivity analysis of the fair value of the I/O strips to changes in certain key assumptions is presented in the following table: | |||||||||
March 31, | |||||||||
2015 | 2014 | ||||||||
( in thousands) | |||||||||
Discount Rate | |||||||||
Increase in fair value from 100 basis point decrease | $ | 8 | $ | 9 | |||||
Decrease in fair value from 100 basis point increase | (8 | ) | (9 | ) | |||||
Constant Prepayment Rate | |||||||||
Increase in fair value from 10 percent decrease | 4 | 5 | |||||||
Decrease in fair value from 10 percent increase | (4 | ) | (5 | ) | |||||
The following is a summary of the activity for servicing assets accounted for under the amortization method: | |||||||||
Three Months Ended | |||||||||
March 31, | |||||||||
2015 | 2014 | ||||||||
(in thousands) | |||||||||
Beginning balance | $ | 167 | $ | 268 | |||||
Amortization | (8 | ) | (28 | ) | |||||
Ending balance | $ | 159 | $ | 240 | |||||
The amortization of the servicing assets has been recorded in non-interest income. | |||||||||
The following is a summary of the activity for servicing assets accounted for under the fair value method: | |||||||||
Three Months Ended | |||||||||
2015 | 2014 | ||||||||
(in thousands) | |||||||||
Beginning balance | $ | 203 | $ | 300 | |||||
Adjustment to fair value | 6 | (38 | ) | ||||||
Ending balance | $ | 209 | $ | 262 | |||||
The fair value adjustments on the servicing assets has been recorded in non-interest income. | |||||||||
The key data and assumptions used in estimating the fair value of servicing assets as of the periods presented were as follows: | |||||||||
March 31, | |||||||||
2015 | 2014 | ||||||||
Weighted-average constant prepayment rate | 6.23 | % | 5.52 | % | |||||
Weighted-average life (in years) | 8 | 9 | |||||||
Weighted-average discount rate | 10.63 | % | 11.93 | % | |||||
A sensitivity analysis of the fair value of servicing assets to change in certain key assumptions is presented in the following table: | |||||||||
March 31, | |||||||||
2015 | 2014 | ||||||||
(in thousands) | |||||||||
Discount Rate | |||||||||
Increase in fair value from 100 basis points decrease | $ | 9 | $ | 11 | |||||
Decrease in fair value from 100 basis points increase | (9 | ) | (10 | ) | |||||
Constant Prepayment Rate | |||||||||
Increase in fair value from 10 percent decrease | 6 | 6 | |||||||
Decrease in fair value from 10 percent increase | (5 | ) | (6 | ) | |||||
This sensitivity analysis generally cannot be extrapolated because the relationship of a change in one key assumption to the change in the fair value of the Company's servicing assets usually is not linear. In addition, the effect of changing one key assumption without changing other assumptions is not a viable option. | |||||||||
Mortgage Loans | |||||||||
From time to time, the Company enters into mortgage loan rate lock commitments (normally for 30 days) with potential borrowers. In conjunction therewith, the Company enters into a forward sale commitment to sell the locked loan to a third party investor. This forward sale agreement requires delivery of the loan on a "best efforts" basis but does not obligate the Company to deliver if the mortgage loan does not fund. | |||||||||
The mortgage rate lock agreement and the forward sale agreement qualify as derivatives. The value of these derivatives is generally equal to the fee, if any, charged to the borrower at inception but may fluctuate in the event of changes in interest rates. These derivative financial instruments are recorded at fair value if material. Although the Company does not attempt to qualify these transactions for the special hedge accounting, management believes that changes in the fair value of the two commitments generally offset and create an economic hedge. At March 31, 2015 and December 31, 2014, the Company had $3.3 million and $1.9 million, respectively, in outstanding mortgage loan interest rate lock and forward sale commitments. The value of related derivative instruments was not material to the Company's financial position or results of operations. At March 31, 2015 and December 31, 2014 the Company had $0.7 million and $0.8 million, respectively of mortgage loans held for sale. |
LOANS_HELD_FOR_INVESTMENT
LOANS HELD FOR INVESTMENT | 3 Months Ended | ||||||||||||||||||||||||||||||||
Mar. 31, 2015 | |||||||||||||||||||||||||||||||||
LOANS HELD FOR INVESTMENT [Abstract] | |||||||||||||||||||||||||||||||||
LOANS HELD FOR INVESTMENT | 4. LOANS HELD FOR INVESTMENT | ||||||||||||||||||||||||||||||||
The composition of the Company's loans held for investment loan portfolio follows: | |||||||||||||||||||||||||||||||||
March 31, | December 31, | ||||||||||||||||||||||||||||||||
2015 | 2014 | ||||||||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||
Manufactured housing | $ | 169,751 | $ | 169,662 | |||||||||||||||||||||||||||||
Commercial real estate | 163,163 | 159,432 | |||||||||||||||||||||||||||||||
Commercial | 48,598 | 49,683 | |||||||||||||||||||||||||||||||
SBA | 20,302 | 21,336 | |||||||||||||||||||||||||||||||
HELOC | 13,130 | 13,481 | |||||||||||||||||||||||||||||||
Single family real estate | 14,606 | 14,957 | |||||||||||||||||||||||||||||||
Consumer | 156 | 178 | |||||||||||||||||||||||||||||||
429,706 | 428,729 | ||||||||||||||||||||||||||||||||
Allowance for loan losses | 7,275 | 7,877 | |||||||||||||||||||||||||||||||
Deferred fees, net | 128 | 118 | |||||||||||||||||||||||||||||||
Discount on SBA loans | 226 | 237 | |||||||||||||||||||||||||||||||
Total loans held for investment, net | $ | 422,077 | $ | 420,497 | |||||||||||||||||||||||||||||
The following table presents the contractual aging of the recorded investment in past due held for investment loans by class of loans: | |||||||||||||||||||||||||||||||||
31-Mar-15 | |||||||||||||||||||||||||||||||||
Recorded | |||||||||||||||||||||||||||||||||
Investment | |||||||||||||||||||||||||||||||||
30-59 Days | 60-89 Days | Over 90 Days | Total | Over 90 Days | |||||||||||||||||||||||||||||
Current | Past Due | Past Due | Past Due | Past Due | Total | and Accruing | |||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||
Manufactured housing | $ | 169,283 | $ | 188 | $ | 155 | $ | 125 | $ | 468 | $ | 169,751 | $ | - | |||||||||||||||||||
Commercial real estate: | |||||||||||||||||||||||||||||||||
Commercial real estate | 119,206 | - | - | 1,342 | 1,342 | 120,548 | - | ||||||||||||||||||||||||||
SBA 504 1st trust deed | 28,596 | - | - | - | - | 28,596 | - | ||||||||||||||||||||||||||
Land | 1,561 | - | - | - | - | 1,561 | - | ||||||||||||||||||||||||||
Construction | 12,458 | - | - | - | - | 12,458 | - | ||||||||||||||||||||||||||
Commercial | 48,356 | 242 | - | - | 242 | 48,598 | - | ||||||||||||||||||||||||||
SBA | 20,248 | 2 | 52 | - | 54 | 20,302 | - | ||||||||||||||||||||||||||
HELOC | 13,066 | - | - | 64 | 64 | 13,130 | - | ||||||||||||||||||||||||||
Single family real estate | 14,606 | - | - | - | 14,606 | - | |||||||||||||||||||||||||||
Consumer | 156 | - | - | - | - | 156 | - | ||||||||||||||||||||||||||
Total | $ | 427,536 | $ | 432 | $ | 207 | $ | 1,531 | $ | 2,170 | $ | 429,706 | $ | - | |||||||||||||||||||
31-Dec-14 | |||||||||||||||||||||||||||||||||
Recorded | |||||||||||||||||||||||||||||||||
Investment | |||||||||||||||||||||||||||||||||
30-59 Days | 60-89 Days | Over 90 Days | Total | Over 90 Days | |||||||||||||||||||||||||||||
Current | Past Due | Past Due | Past Due | Past Due | Total | and Accruing | |||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||
Manufactured housing | $ | 169,233 | $ | 239 | $ | - | $ | 190 | $ | 429 | $ | 169,662 | $ | - | |||||||||||||||||||
Commercial real estate: | |||||||||||||||||||||||||||||||||
Commercial real estate | 119,090 | 632 | - | 186 | 818 | 119,908 | - | ||||||||||||||||||||||||||
SBA 504 1st trust deed | 27,297 | - | - | - | - | 27,297 | - | ||||||||||||||||||||||||||
Land | 1,569 | - | - | - | - | 1,569 | - | ||||||||||||||||||||||||||
Construction | 10,658 | - | - | - | - | 10,658 | - | ||||||||||||||||||||||||||
Commercial | 49,683 | - | - | - | - | 49,683 | - | ||||||||||||||||||||||||||
SBA | 21,333 | 3 | - | - | 3 | 21,336 | - | ||||||||||||||||||||||||||
HELOC | 13,459 | - | - | 22 | 22 | 13,481 | - | ||||||||||||||||||||||||||
Single family real estate | 14,821 | - | 136 | 136 | 14,957 | - | |||||||||||||||||||||||||||
Consumer | 178 | - | - | - | - | 178 | - | ||||||||||||||||||||||||||
Total | $ | 427,321 | $ | 874 | $ | - | $ | 534 | $ | 1,408 | $ | 428,729 | $ | - | |||||||||||||||||||
Allowance for Loan Losses | |||||||||||||||||||||||||||||||||
The following table summarizes the changes in the allowance for loan losses: | |||||||||||||||||||||||||||||||||
Three Months Ended | |||||||||||||||||||||||||||||||||
March 31, | |||||||||||||||||||||||||||||||||
2015 | 2014 | ||||||||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||
Beginning balance | $ | 7,877 | $ | 12,208 | |||||||||||||||||||||||||||||
Charge-offs | (131 | ) | (252 | ) | |||||||||||||||||||||||||||||
Recoveries | 497 | 771 | |||||||||||||||||||||||||||||||
Net (charge-offs) recoveries | 366 | 519 | |||||||||||||||||||||||||||||||
Provision | (968 | ) | (1,371 | ) | |||||||||||||||||||||||||||||
Ending balance | $ | 7,275 | $ | 11,356 | |||||||||||||||||||||||||||||
As of March 31, 2015 and December 31, 2014, the Company had reserves for credit losses on undisbursed loans of $37,000 and $39,000, respectively which were included in Other liabilities. | |||||||||||||||||||||||||||||||||
The following tables summarize the changes in the allowance for loan losses by portfolio type: | |||||||||||||||||||||||||||||||||
For the Three Months Ended March 31, | |||||||||||||||||||||||||||||||||
Manufactured | Commercial | Single Family | |||||||||||||||||||||||||||||||
Housing | Real Estate | Commercial | SBA | HELOC | Real Estate | Consumer | Total | ||||||||||||||||||||||||||
2015 | (in thousands) | ||||||||||||||||||||||||||||||||
Beginning balance | $ | 4,032 | $ | 1,459 | $ | 986 | $ | 1,066 | $ | 140 | $ | 192 | $ | 2 | $ | 7,877 | |||||||||||||||||
Charge-offs | (131 | ) | - | - | - | - | - | - | (131 | ) | |||||||||||||||||||||||
Recoveries | 49 | 13 | 321 | 110 | 3 | 1 | - | 497 | |||||||||||||||||||||||||
Net charge-offs | (82 | ) | 13 | 321 | 110 | 3 | 1 | - | 366 | ||||||||||||||||||||||||
Provision | 88 | 105 | (707 | ) | (298 | ) | (90 | ) | (68 | ) | 2 | (968 | ) | ||||||||||||||||||||
Ending balance | $ | 4,038 | $ | 1,577 | $ | 600 | $ | 878 | $ | 53 | $ | 125 | $ | 4 | $ | 7,275 | |||||||||||||||||
2014 | |||||||||||||||||||||||||||||||||
Beginning balance | $ | 5,114 | $ | 2,552 | $ | 2,064 | $ | 1,951 | $ | 280 | $ | 245 | $ | 2 | $ | 12,208 | |||||||||||||||||
Charge-offs | (240 | ) | - | - | (12 | ) | - | - | - | (252 | ) | ||||||||||||||||||||||
Recoveries | 36 | 639 | 29 | 51 | 15 | 1 | - | 771 | |||||||||||||||||||||||||
Net charge-offs | (204 | ) | 639 | 29 | 39 | 15 | 1 | - | 519 | ||||||||||||||||||||||||
Provision | (30 | ) | (907 | ) | (265 | ) | (132 | ) | (30 | ) | (7 | ) | - | (1,371 | ) | ||||||||||||||||||
Ending balance | $ | 4,880 | $ | 2,284 | $ | 1,828 | $ | 1,858 | $ | 265 | $ | 239 | $ | 2 | $ | 11,356 | |||||||||||||||||
The following tables present impairment method information related to loans and allowance for loan losses by loan portfolio segment: | |||||||||||||||||||||||||||||||||
Manufactured | Commercial | Single Family | Total | ||||||||||||||||||||||||||||||
Housing | Real Estate | Commercial | SBA | HELOC | Real Estate | Consumer | Loans | ||||||||||||||||||||||||||
Loans Held for Investment as of March 31, 2015: | (in thousands) | ||||||||||||||||||||||||||||||||
Recorded Investment: | |||||||||||||||||||||||||||||||||
Impaired loans with an allowance recorded | $ | 3,237 | $ | 1,443 | $ | 2,854 | $ | 1,674 | $ | 21 | $ | 71 | $ | - | $ | 9,300 | |||||||||||||||||
Impaired loans with no allowance recorded | 4,033 | 1,813 | 44 | 149 | 63 | 460 | - | 6,562 | |||||||||||||||||||||||||
Total loans individually evaluated for impairment | 7,270 | 3,256 | 2,898 | 1,823 | 84 | 531 | - | 15,862 | |||||||||||||||||||||||||
Loans collectively evaluated for impairment | 162,481 | 159,907 | 45,700 | 18,479 | 13,046 | 14,075 | 156 | 413,844 | |||||||||||||||||||||||||
Total loans held for investment | $ | 169,751 | $ | 163,163 | $ | 48,598 | $ | 20,302 | $ | 13,130 | $ | 14,606 | $ | 156 | $ | 429,706 | |||||||||||||||||
Unpaid Principal Balance | |||||||||||||||||||||||||||||||||
Impaired loans with an allowance recorded | $ | 3,278 | $ | 1,622 | $ | 3,543 | $ | 7,837 | $ | 21 | $ | 71 | $ | - | $ | 16,372 | |||||||||||||||||
Impaired loans with no allowance recorded | 5,900 | 3,923 | 50 | 1,678 | 69 | 612 | - | 12,232 | |||||||||||||||||||||||||
Total loans individually evaluated for impairment | 9,178 | 5,545 | 3,593 | 9,515 | 90 | 683 | - | 28,604 | |||||||||||||||||||||||||
Loans collectively evaluated for impairment | 162,481 | 159,907 | 45,700 | 18,479 | 13,046 | 14,075 | 156 | 413,844 | |||||||||||||||||||||||||
Total loans held for investment | $ | 171,659 | $ | 165,452 | $ | 49,293 | $ | 27,994 | $ | 13,136 | $ | 14,758 | $ | 156 | $ | 442,448 | |||||||||||||||||
Related Allowance for Credit Losses | |||||||||||||||||||||||||||||||||
Impaired loans with an allowance recorded | $ | 428 | $ | 15 | $ | 50 | $ | 183 | $ | - | $ | 10 | $ | - | $ | 686 | |||||||||||||||||
Impaired loans with no allowance recorded | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||
Total loans individually evaluated for impairment | 428 | 15 | 50 | 183 | - | 10 | - | 686 | |||||||||||||||||||||||||
Loans collectively evaluated for impairment | 3,610 | 1,562 | 550 | 695 | 53 | 115 | 4 | 6,589 | |||||||||||||||||||||||||
Total loans held for investment | $ | 4,038 | $ | 1,577 | $ | 600 | $ | 878 | $ | 53 | $ | 125 | $ | 4 | $ | 7,275 | |||||||||||||||||
Manufactured | Commercial | Single Family | Total | ||||||||||||||||||||||||||||||
Housing | Real Estate | Commercial | SBA | HELOC | Real Estate | Consumer | Loans | ||||||||||||||||||||||||||
Loans Held for Investment as of December 31, 2014: | (in thousands) | ||||||||||||||||||||||||||||||||
Recorded Investment: | |||||||||||||||||||||||||||||||||
Impaired loans with an allowance recorded | $ | 4,717 | $ | 2,783 | $ | 3,122 | $ | 1,837 | $ | 86 | $ | 591 | $ | - | $ | 13,136 | |||||||||||||||||
Impaired loans with no allowance recorded | 2,734 | 831 | 44 | 4 | - | 90 | - | 3,703 | |||||||||||||||||||||||||
Total loans individually evaluated for impairment | 7,451 | 3,614 | 3,166 | 1,841 | 86 | 681 | - | 16,839 | |||||||||||||||||||||||||
Loans collectively evaluated for impairment | 162,211 | 155,818 | 46,517 | 19,495 | 13,395 | 14,276 | 178 | 411,890 | |||||||||||||||||||||||||
Total loans held for investment | $ | 169,662 | $ | 159,432 | $ | 49,683 | $ | 21,336 | $ | 13,481 | $ | 14,957 | $ | 178 | $ | 428,729 | |||||||||||||||||
Unpaid Principal Balance | |||||||||||||||||||||||||||||||||
Impaired loans with an allowance recorded | $ | 5,172 | $ | 2,979 | $ | 4,914 | $ | 9,512 | $ | 91 | $ | 644 | $ | - | $ | 23,312 | |||||||||||||||||
Impaired loans with no allowance recorded | 4,243 | 2,895 | 50 | 225 | - | 191 | - | 7,604 | |||||||||||||||||||||||||
Total loans individually evaluated for impairment | 9,415 | 5,874 | 4,964 | 9,737 | 91 | 835 | - | 30,916 | |||||||||||||||||||||||||
Loans collectively evaluated for impairment | 162,211 | 155,818 | 46,517 | 19,495 | 13,395 | 14,276 | 178 | 411,890 | |||||||||||||||||||||||||
Total loans held for investment | $ | 171,626 | $ | 161,692 | $ | 51,481 | $ | 29,232 | $ | 13,486 | $ | 15,111 | $ | 178 | $ | 442,806 | |||||||||||||||||
Related Allowance for Credit Losses | |||||||||||||||||||||||||||||||||
Impaired loans with an allowance recorded | $ | 399 | $ | 77 | $ | 241 | $ | 104 | $ | 1 | $ | 32 | $ | - | $ | 854 | |||||||||||||||||
Impaired loans with no allowance recorded | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||
Total loans individually evaluated for impairment | 399 | 77 | 241 | 104 | 1 | 32 | - | 854 | |||||||||||||||||||||||||
Loans collectively evaluated for impairment | 3,633 | 1,382 | 745 | 962 | 139 | 160 | 2 | 7,023 | |||||||||||||||||||||||||
Total loans held for investment | $ | 4,032 | $ | 1,459 | $ | 986 | $ | 1,066 | $ | 140 | $ | 192 | $ | 2 | $ | 7,877 | |||||||||||||||||
A valuation allowance is established for an impaired loan when the fair value of the loan is less than the recorded investment. In certain cases, portions of impaired loans are charged-off to realizable value instead of establishing a valuation allowance and are included, when applicable in the table below as "Impaired loans without specific valuation allowance under ASC 310." The valuation allowance disclosed above is included in the allowance for loan losses reported in the consolidated balance sheets as of March 31, 2015 and December 31, 2014. | |||||||||||||||||||||||||||||||||
The table below reflects recorded investment in loans classified as impaired: | |||||||||||||||||||||||||||||||||
March 31, | December 31, | ||||||||||||||||||||||||||||||||
2015 | 2014 | ||||||||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||
Impaired loans with a specific valuation allowance under ASC 310 | $ | 9,300 | $ | 13,136 | |||||||||||||||||||||||||||||
Impaired loans without a specific valuation allowance under ASC 310 | 6,562 | 3,703 | |||||||||||||||||||||||||||||||
Total impaired loans | $ | 15,862 | $ | 16,839 | |||||||||||||||||||||||||||||
Valuation allowance related to impaired loans | $ | 686 | $ | 854 | |||||||||||||||||||||||||||||
The following tables summarize impaired loans by class of loans: | |||||||||||||||||||||||||||||||||
March 31, | December 31, | ||||||||||||||||||||||||||||||||
2015 | 2014 | ||||||||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||
Manufactured housing | $ | 7,270 | $ | 7,451 | |||||||||||||||||||||||||||||
Commercial real estate : | |||||||||||||||||||||||||||||||||
Commercial real estate | 2,262 | 2,320 | |||||||||||||||||||||||||||||||
SBA 504 1st trust deed | 994 | 1,294 | |||||||||||||||||||||||||||||||
Commercial | 2,898 | 3,166 | |||||||||||||||||||||||||||||||
SBA | 1,823 | 1,841 | |||||||||||||||||||||||||||||||
HELOC | 84 | 86 | |||||||||||||||||||||||||||||||
Single family real estate | 531 | 681 | |||||||||||||||||||||||||||||||
Total | $ | 15,862 | $ | 16,839 | |||||||||||||||||||||||||||||
The following table summarizes average investment in impaired loans by class of loans and the related interest income recognized: | |||||||||||||||||||||||||||||||||
Three Months Ended | |||||||||||||||||||||||||||||||||
March 31, | |||||||||||||||||||||||||||||||||
2015 | 2014 | ||||||||||||||||||||||||||||||||
Average Investment | Interest | Average Investment | Interest | ||||||||||||||||||||||||||||||
in Impaired Loans | Income | in Impaired Loans | Income | ||||||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||
Manufactured housing | $ | 7,288 | $ | 115 | $ | 8,862 | $ | 59 | |||||||||||||||||||||||||
Commercial real estate: | |||||||||||||||||||||||||||||||||
Commercial real estate | 2,269 | - | 2,728 | - | |||||||||||||||||||||||||||||
SBA 504 1st trust deed | 1,133 | 9 | 768 | 5 | |||||||||||||||||||||||||||||
Land | - | - | 140 | - | |||||||||||||||||||||||||||||
Commercial | 3,003 | - | 3,662 | 14 | |||||||||||||||||||||||||||||
SBA | 1,814 | 11 | 1,770 | 3 | |||||||||||||||||||||||||||||
HELOC | 85 | - | 597 | 5 | |||||||||||||||||||||||||||||
Single family real estate | 600 | 1 | 740 | 1 | |||||||||||||||||||||||||||||
Consumer | - | - | - | - | |||||||||||||||||||||||||||||
Total | $ | 16,192 | $ | 136 | $ | 19,267 | $ | 87 | |||||||||||||||||||||||||
The Company is not committed to lend additional funds on these impaired loans. | |||||||||||||||||||||||||||||||||
The following table reflects the recorded investment in certain types of loans at the periods indicated: | |||||||||||||||||||||||||||||||||
March 31, | December 31, | ||||||||||||||||||||||||||||||||
2015 | 2014 | ||||||||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||
Nonaccrual loans | $ | 16,048 | $ | 17,883 | |||||||||||||||||||||||||||||
SBA guaranteed portion of loans included above | (5,566 | ) | (6,856 | ) | |||||||||||||||||||||||||||||
Total nonaccrual loans, net | $ | 10,482 | $ | 11,027 | |||||||||||||||||||||||||||||
Troubled debt restructured loans, gross | $ | 9,462 | $ | 9,685 | |||||||||||||||||||||||||||||
Loans 30 through 89 days past due with interest accruing | $ | 513 | $ | - | |||||||||||||||||||||||||||||
Allowance for loan losses to gross loans held for investment | 1.69 | % | 1.84 | % | |||||||||||||||||||||||||||||
The accrual of interest is discontinued when substantial doubt exists as to collectability of the loan; generally at the time the loan is 90 days delinquent. Any unpaid but accrued interest is reversed at that time. Thereafter, interest income is no longer recognized on the loan. Interest income may be recognized on impaired loans to the extent they are not past due by 90 days. Interest on nonaccrual loans is accounted for on the cash-basis or cost-recovery method, until qualifying for return to accrual. Loans are returned to accrual status when all of the principal and interest amounts contractually due are brought current and future payments are reasonably assured. Foregone interest on nonaccrual and troubled debt restructured loans for the three months ended March 31, 2015 and 2014 was $0.3 million and $0.4 million, respectively. | |||||||||||||||||||||||||||||||||
The following table presents the composition of nonaccrual loans, net of government guarantees, by class of loans: | |||||||||||||||||||||||||||||||||
March 31, | December 31, | ||||||||||||||||||||||||||||||||
2015 | 2014 | ||||||||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||
Manufactured housing | $ | 1,735 | $ | 1,480 | |||||||||||||||||||||||||||||
Commercial real estate: | |||||||||||||||||||||||||||||||||
Commercial real estate | 2,887 | 2,951 | |||||||||||||||||||||||||||||||
SBA 504 1st trust deed | 724 | 1,021 | |||||||||||||||||||||||||||||||
Commercial | 2,898 | 3,167 | |||||||||||||||||||||||||||||||
SBA | 1,693 | 1,713 | |||||||||||||||||||||||||||||||
HELOC | 85 | 86 | |||||||||||||||||||||||||||||||
Single family real estate | 460 | 609 | |||||||||||||||||||||||||||||||
Total | $ | 10,482 | $ | 11,027 | |||||||||||||||||||||||||||||
The guaranteed portion of each SBA loan is repurchased from investors when those loans become past due 120 days by either CWB or the SBA directly. After the foreclosure and collection process is complete, the principal balance of loans repurchased by CWB are reimbursed by the SBA. Although these balances do not earn interest during this period, they generally do not result in a loss of principal to CWB; therefore a repurchase reserve has not been established related to these loans. | |||||||||||||||||||||||||||||||||
The Company utilizes an internal asset classification system as a means of reporting problem and potential problem loans. Under the Company's risk rating system, the Company classifies problem and potential problem loans as "Special Mention," "Substandard," "Doubtful" and "Loss". Substandard loans are inadequately protected by the current sound net worth and paying capacity of the obligor or of the collateral pledged, if any. Loans so classified have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the Company will sustain some loss if the deficiencies are not corrected. Loans classified as Doubtful, have all the weaknesses inherent in those classified Substandard with the added characteristic that the weaknesses present make collection or liquidation in full, on the basis of currently existing facts, conditions and values, highly questionable and improbable. The possibility of loss is extremely high, but because of certain important and reasonably specific pending factors, which may work to the advantage and strengthening of the loan, its classification as an estimated loss is deferred until its more exact status may be determined. Pending factors include proposed merger, acquisition or liquidation procedures, capital injection, perfecting liens on additional collateral and refinancing plans. Loans classified Loss are considered uncollectible and of such little value that their continuance as bankable loans is not warranted. This classification does not mean that the asset has absolutely no recovery or salvage value, but rather it is not practical or desirable to defer writing off this loan even though partial recovery may be affected in the future. Losses are taken in the period in which they surface as uncollectible. Loans that do not currently expose the Company to sufficient risk to warrant classification in one of the aforementioned categories but possess weaknesses that deserve management's close attention are deemed to be Special Mention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or in the institution's credit position at some future date. Special Mention assets are not adversely classified and do not expose an institution to sufficient risk to warrant adverse classification. Risk ratings are updated as part of our normal loan monitoring process, at a minimum, annually. | |||||||||||||||||||||||||||||||||
The following tables present gross loans by risk rating: | |||||||||||||||||||||||||||||||||
31-Mar-15 | |||||||||||||||||||||||||||||||||
Special | |||||||||||||||||||||||||||||||||
Pass | Mention | Substandard | Doubtful | Total | |||||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||
Manufactured housing | $ | 164,852 | $ | - | $ | 4,899 | $ | - | $ | 169,751 | |||||||||||||||||||||||
Commercial real estate: | |||||||||||||||||||||||||||||||||
Commercial real estate | 107,265 | 6,918 | 6,365 | - | 120,548 | ||||||||||||||||||||||||||||
SBA 504 1st trust deed | 23,531 | 1,744 | 3,321 | - | 28,596 | ||||||||||||||||||||||||||||
Land | 1,561 | - | - | - | 1,561 | ||||||||||||||||||||||||||||
Construction | 12,458 | - | - | - | 12,458 | ||||||||||||||||||||||||||||
Commercial | 45,199 | 398 | 3,001 | - | 48,598 | ||||||||||||||||||||||||||||
SBA | 11,837 | 270 | 1,875 | 91 | 14,073 | ||||||||||||||||||||||||||||
HELOC | 12,288 | - | 842 | - | 13,130 | ||||||||||||||||||||||||||||
Single family real estate | 13,961 | - | 645 | - | 14,606 | ||||||||||||||||||||||||||||
Consumer | 156 | - | - | - | 156 | ||||||||||||||||||||||||||||
Total, net | $ | 393,108 | $ | 9,330 | $ | 20,948 | $ | 91 | $ | 423,477 | |||||||||||||||||||||||
SBA guarantee | - | - | 6,229 | - | 6,229 | ||||||||||||||||||||||||||||
Total | $ | 393,108 | $ | 9,330 | $ | 27,177 | $ | 91 | $ | 429,706 | |||||||||||||||||||||||
31-Dec-14 | |||||||||||||||||||||||||||||||||
Special | |||||||||||||||||||||||||||||||||
Pass | Mention | Substandard | Doubtful | Total | |||||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||
Manufactured housing | $ | 162,638 | $ | - | $ | 7,024 | $ | - | $ | 169,662 | |||||||||||||||||||||||
Commercial real estate: | |||||||||||||||||||||||||||||||||
Commercial real estate | 106,909 | 6,544 | 6,455 | - | 119,908 | ||||||||||||||||||||||||||||
SBA 504 1st trust deed | 23,038 | 1,085 | 3,174 | - | 27,297 | ||||||||||||||||||||||||||||
Land | 1,569 | - | - | - | 1,569 | ||||||||||||||||||||||||||||
Construction | 10,658 | - | - | - | 10,658 | ||||||||||||||||||||||||||||
Commercial | 46,275 | 158 | 3,250 | - | 49,683 | ||||||||||||||||||||||||||||
SBA | 12,803 | 173 | 1,891 | 97 | 14,964 | ||||||||||||||||||||||||||||
HELOC | 12,888 | - | 593 | - | 13,481 | ||||||||||||||||||||||||||||
Single family real estate | 14,105 | - | 852 | - | 14,957 | ||||||||||||||||||||||||||||
Consumer | 178 | - | - | - | 178 | ||||||||||||||||||||||||||||
Total, net | $ | 391,061 | $ | 7,960 | $ | 23,239 | $ | 97 | $ | 422,357 | |||||||||||||||||||||||
SBA guarantee | - | - | 6,372 | - | 6,372 | ||||||||||||||||||||||||||||
Total | $ | 391,061 | $ | 7,960 | $ | 29,611 | $ | 97 | $ | 428,729 | |||||||||||||||||||||||
Troubled Debt Restructured Loan (TDR) | |||||||||||||||||||||||||||||||||
A TDR is a loan on which the bank, for reasons related to a borrower's financial difficulties, grants a concession to the borrower that the bank would not otherwise consider. The loan terms that have been modified or restructured due to a borrower's financial situation include, but are not limited to, a reduction in the stated interest rate, an extension of the maturity or renewal of the loan at an interest rate below current market, a reduction in the face amount of the debt, a reduction in the accrued interest, extensions, deferrals, renewals and rewrites. The majority of the bank's modifications are extensions in terms or deferral of payments which result in no lost principal or interest followed by reductions in interest rates or accrued interest. A TDR is also considered impaired. Generally, a loan that is modified at an effective market rate of interest may no longer be disclosed as a troubled debt restructuring in years subsequent to the restructuring if it is not impaired based on the terms specified by the restructuring agreement. | |||||||||||||||||||||||||||||||||
The following tables summarize the financial effects of TDR loans by loan class for the periods presented: | |||||||||||||||||||||||||||||||||
For the Three Months Ended March 31, 2015 | |||||||||||||||||||||||||||||||||
Pre- | Post | Balance of | Balance of | Effect on | |||||||||||||||||||||||||||||
Number | Modification | Modification | Loans with | Loans with | Allowance for | ||||||||||||||||||||||||||||
of Loans | Recorded Investment | Recorded Investment | Rate Reduction | Term Extension | Loan Losses | ||||||||||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||||||||
Manufactured housing | 3 | $ | 174 | $ | 174 | $ | - | $ | 156 | $ | 4 | ||||||||||||||||||||||
Total | 3 | $ | 174 | $ | 174 | $ | - | $ | 156 | $ | 4 | ||||||||||||||||||||||
For the Three Months Ended March 31, 2014 | |||||||||||||||||||||||||||||||||
Pre- | Post | Balance of | Balance of | Effect on | |||||||||||||||||||||||||||||
Number | Modification | Modification | Loans with | Loans with | Allowance for | ||||||||||||||||||||||||||||
of Loans | Recorded Investment | Recorded Investment | Rate Reduction | Term Extension | Loan Losses | ||||||||||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||||||||
Manufactured housing | 4 | $ | 187 | $ | 187 | 187 | $ | 187 | 5 | ||||||||||||||||||||||||
Total | 4 | $ | 187 | $ | 187 | $ | 187 | $ | 187 | $ | 5 | ||||||||||||||||||||||
The average rate concessions were 0 basis points and 63 basis points for the three months ended March 31, 2015 and 2014, respectively. The average term extension in months was 13 and 180 for the first quarter of 2015 and 2014, respectively. | |||||||||||||||||||||||||||||||||
The following tables present TDR's by class for which there was a payment default during the period: | |||||||||||||||||||||||||||||||||
Three Months Ended | |||||||||||||||||||||||||||||||||
March 31, | |||||||||||||||||||||||||||||||||
2015 | 2014 | ||||||||||||||||||||||||||||||||
Number | Recorded | Effect on | Number | Recorded | Effect on | ||||||||||||||||||||||||||||
of Loans | Investment | Allowance for | of Loans | Investment | Allowance for | ||||||||||||||||||||||||||||
Loan Losses | Loan Losses | ||||||||||||||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||||||||
Manufactured housing | - | $ | - | $ | - | 1 | $ | 18 | $ | 5 | |||||||||||||||||||||||
Total | - | $ | - | $ | - | 1 | $ | 18 | $ | 5 | |||||||||||||||||||||||
A TDR loan is deemed to have a payment default when the borrower fails to make two consecutive payments or the collateral is transferred to repossessed assets. | |||||||||||||||||||||||||||||||||
At March 31, 2015 there were no material loan commitments outstanding on TDR loans. |
OTHER_ASSETS_ACQUIRED_THROUGH_
OTHER ASSETS ACQUIRED THROUGH FORECLOSURE | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
OTHER ASSETS ACQUIRED THROUGH FORECLOSURE [Abstract] | |||||||||
OTHER ASSETS ACQUIRED THROUGH FORECLOSURE | 5. OTHER ASSETS ACQUIRED THROUGH FORECLOSURE | ||||||||
The following table summarizes the changes in other assets acquired through foreclosure: | |||||||||
Three Months Ended | |||||||||
March 31, | |||||||||
2015 | 2014 | ||||||||
(in thousands) | |||||||||
Balance, beginning of period | $ | 137 | $ | 3,811 | |||||
Additions | 222 | 403 | |||||||
Proceeds from dispositions and receivables from participants | (40 | ) | (393 | ) | |||||
Gains (losses) on sales, net | 1 | (40 | ) | ||||||
Balance, end of period | $ | 320 | $ | 3,781 |
FAIR_VALUE_MEASUREMENT
FAIR VALUE MEASUREMENT | 3 Months Ended | ||||||||||||||||||||
Mar. 31, 2015 | |||||||||||||||||||||
FAIR VALUE MEASUREMENT [Abstract] | |||||||||||||||||||||
FAIR VALUE MEASUREMENT | 6. FAIR VALUE MEASUREMENT | ||||||||||||||||||||
The Company uses fair value measurements to record fair value adjustments to certain assets and liabilities. FASB ASC 820, Fair Value Measurements and Disclosures ("ASC 820") established a framework for measuring fair value using a three-level valuation hierarchy for disclosure of fair value measurement. The valuation hierarchy is based upon the transparency of inputs to the valuation of an asset as of the measurement date. ASC 820 establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that observable inputs be used when available. Observable inputs are inputs that market participants would use in pricing the asset or liability developed based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company's assumptions about the factors market participants would consider in pricing the asset or liability developed based on the best information available in the circumstances. The hierarchy is broken down into three levels based on the reliability of inputs, as follows: | |||||||||||||||||||||
· | Level 1— Observable quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities. | ||||||||||||||||||||
· | Level 2— Observable quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, matrix pricing or model-based valuation techniques where all significant assumptions are observable, either directly or indirectly in the market. | ||||||||||||||||||||
· | Level 3— Model-based techniques where all significant assumptions are not observable, either directly or indirectly, in the market. These unobservable assumptions reflect management's estimates of assumptions that market participants would use in pricing the asset or liability. Valuation techniques may include use of discounted cash flow models and similar techniques. | ||||||||||||||||||||
The availability of observable inputs varies based on the nature of the specific financial instrument. To the extent that valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment exercised by the Company in determining fair value is greatest for instruments categorized in Level 3. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the level in the fair value hierarchy within which the fair value measurement in its entirety falls is determined based on the lowest level input that is significant to the fair value measurement in its entirety. | |||||||||||||||||||||
Fair value is a market-based measure considered from the perspective of a market participant who holds the asset or owes the liability rather than an entity-specific measure. When market assumptions are available, ASC 820 requires the Company to make assumptions regarding the assumptions that market participants would use to estimate the fair value of the financial instrument at the measurement date. | |||||||||||||||||||||
FASB ASC 825, Financial Instruments ("ASC 825") requires disclosure of fair value information about financial instruments, whether or not recognized in the balance sheet, for which it is practicable to estimate that value. | |||||||||||||||||||||
Management uses its best judgment in estimating the fair value of the Company's financial instruments; however, there are inherent limitations in any estimation technique. Therefore, for substantially all financial instruments, the fair value estimates presented herein are not necessarily indicative of the amounts the Company could have realized in a sales transaction at March 31, 2015 and December 31,2015. The estimated fair value amounts for March 31, 2015 and December 31, 2014 have been measured as of period-end, and have not been reevaluated or updated for purposes of these consolidated financial statements subsequent to those dates. As such, the estimated fair values of these financial instruments subsequent to the reporting date may be different than the amounts reported at the period-end. | |||||||||||||||||||||
This information should not be interpreted as an estimate of the fair value of the entire Company since a fair value calculation is only required for a limited portion of the Company's assets and liabilities. | |||||||||||||||||||||
Due to the wide range of valuation techniques and the degree of subjectivity used in making the estimate, comparisons between the Company's disclosures and those of other companies or banks may not be meaningful. | |||||||||||||||||||||
The following tables summarize the fair value of assets measured on a recurring basis: | |||||||||||||||||||||
Fair Value Measurements at the End of the Reporting Period Using: | |||||||||||||||||||||
Quoted Prices | |||||||||||||||||||||
in Active | Significant | ||||||||||||||||||||
Markets for | Other | Significant | |||||||||||||||||||
Identical | Observable | Unobservable | |||||||||||||||||||
Assets | Inputs | Inputs | Fair | ||||||||||||||||||
31-Mar-15 | (Level 1) | (Level 2) | (Level 3) | Value | |||||||||||||||||
Assets: | (in thousands) | ||||||||||||||||||||
Investment securities available-for-sale | $ | 56 | $ | 23,067 | $ | - | $ | 23,123 | |||||||||||||
Interest only strips | - | - | 286 | 286 | |||||||||||||||||
Servicing assets | - | - | 209 | 209 | |||||||||||||||||
$ | 56 | $ | 23,067 | $ | 495 | $ | 23,618 | ||||||||||||||
Fair Value Measurements at the End of the Reporting Period Using: | |||||||||||||||||||||
Quoted Prices | |||||||||||||||||||||
in Active | Significant | ||||||||||||||||||||
Markets for | Other | Significant | |||||||||||||||||||
Identical | Observable | Unobservable | |||||||||||||||||||
Assets | Inputs | Inputs | Fair | ||||||||||||||||||
31-Dec-14 | (Level 1) | (Level 2) | (Level 3) | Value | |||||||||||||||||
Assets: | (in thousands) | ||||||||||||||||||||
Investment securities available-for-sale | $ | 61 | $ | 22,133 | $ | - | $ | 22,194 | |||||||||||||
Interest only strips | - | - | 293 | 293 | |||||||||||||||||
Servicing assets | - | - | 203 | 203 | |||||||||||||||||
$ | 61 | $ | 22,133 | $ | 496 | $ | 22,690 | ||||||||||||||
Market valuations of our investment securities which are classified as level 2 are provided by an independent third party. The fair values are determined by using several sources for valuing fixed income securities. Their techniques include pricing models that vary based on the type of asset being valued and incorporate available trade, bid and other market information. In accordance with the fair value hierarchy, the market valuation sources include observable market inputs and are therefore considered Level 2 inputs for purposes of determining the fair values. | |||||||||||||||||||||
On certain SBA loan sales, the Company retained I/O strips which represent the present value of excess net cash flows generated by the difference between (a) interest at the stated rate paid by borrowers and (b) the sum of (i) pass-through interest paid to third-party investors and (ii) contractual servicing fees. I/O strips are classified as Level 3 in the fair value hierarchy. The fair value is determined on a quarterly basis through a discounted cash flow analysis prepared by an independent third party using industry prepayment speeds. I/O strip valuation adjustments are recorded as additions or offsets to loan servicing income. For additional information see Note 3 "Loan Sales and Servicing" beginning on page 15. | |||||||||||||||||||||
Historically, the Company has elected to use the amortizing method for the treatment of servicing assets and has measured for impairment on a quarterly basis through a discounted cash flow analysis prepared by an independent third party using industry prepayment speeds. In connection with the sale of certain SBA and USDA loans the Company recorded servicing assets and elected to measure those assets at fair value in accordance with ASC 825-10. Significant assumptions in the valuation of servicing assets include estimated loan repayment rates, the discount rate, and servicing costs, among others. Servicing assets are classified as Level 3 measurements due to the use of significant unobservable inputs, as well as significant management judgment and estimation. | |||||||||||||||||||||
The Company also has assets that under certain conditions are subject to measurement at fair value on a non-recurring basis. These assets include loans held for sale, foreclosed real estate and repossessed assets and certain loans that are considered impaired per generally accepted accounting principles. | |||||||||||||||||||||
The following summarizes the fair value measurements of assets measured on a non-recurring basis: | |||||||||||||||||||||
Fair Value Measurements at the End of the Reporting Period Using | |||||||||||||||||||||
Quoted Prices | |||||||||||||||||||||
in Active | Active | ||||||||||||||||||||
Markets for | Markets for | Unobservable | |||||||||||||||||||
Identical Assets | Similar Assets | Inputs | |||||||||||||||||||
Total | (Level 1) | (Level 2) | (Level 3) | ||||||||||||||||||
(in thousands) | |||||||||||||||||||||
As of March 31, 2015: | |||||||||||||||||||||
Impaired loans | $ | 4,227 | $ | - | $ | 4,227 | $ | - | |||||||||||||
Loans held for sale | 68,268 | - | 68,268 | - | |||||||||||||||||
Foreclosed real estate and repossessed assets | 320 | - | 320 | - | |||||||||||||||||
$ | 72,815 | $ | - | $ | 72,815 | $ | - | ||||||||||||||
As of December 31, 2014: | |||||||||||||||||||||
Impaired loans | $ | 5,580 | $ | - | $ | 5,580 | $ | - | |||||||||||||
Loans held for sale | 71,475 | - | 71,475 | - | |||||||||||||||||
Foreclosed real estate and repossessed assets | 137 | - | 137 | - | |||||||||||||||||
$ | 77,192 | $ | - | $ | 77,192 | $ | - | ||||||||||||||
The Company records certain loans at fair value on a non-recurring basis. When a loan is considered impaired an allowance for a loan loss is established. The fair value measurement and disclosure requirement applies to loans measured for impairment using the practical expedients method permitted by accounting guidance for impaired loans. Impaired loans are measured at an observable market price, if available or at the fair value of the loan's collateral, if the loan is collateral dependent. The fair value of the loan's collateral is determined by appraisals or independent valuation. When the fair value of the loan's collateral is based on an observable market price or current appraised value, given the current real estate markets, the appraisals may contain a wide range of values and accordingly, the Company classifies the fair value of the impaired loans as a non-recurring valuation within Level 2 of the valuation hierarchy. For loans in which impairment is determined based on the net present value of cash flows, the Company classifies these as a non-recurring valuation within Level 3 of the valuation hierarchy. | |||||||||||||||||||||
Loans held for sale are carried at the lower of cost or fair value. The fair value of loans held for sale is based on what secondary markets are currently offering for portfolios with similar characteristics or based on the agreed-upon sale price. As such, the Company classifies the fair value of loans held for sale as a non-recurring valuation within Level 2 of the fair value hierarchy. At March 31, 2015 and December 31 2014, the Company had loans held for sale with an aggregate carrying value of $63.7 million and $66.8 million respectively. | |||||||||||||||||||||
Foreclosed real estate and repossessed assets are carried at the lower of book value or fair value less estimated costs to sell. Fair value is based upon independent market prices obtained from certified appraisers or the current listing price, if lower. When the fair value of the collateral is based on a current appraised value, the Company reports the fair value of the foreclosed collateral as non-recurring Level 2. When a current appraised value is not available or if management determines the fair value of the collateral is further impaired, the Company reports the foreclosed collateral as non-recurring Level 3. | |||||||||||||||||||||
FAIR VALUES OF FINANCIAL INSTRUMENTS | |||||||||||||||||||||
The estimated fair values of financial instruments have been determined by the Company using available market information and appropriate valuation methodologies. However, considerable judgment is required to interpret market data to develop estimates of fair value. Accordingly, the estimates presented herein are not necessarily indicative of the amounts the Company could realize in a current market exchange. The use of different market assumptions and/or estimation methodologies may have a material effect on the estimated fair value amounts. | |||||||||||||||||||||
The estimated fair value of the Company's financial instruments are as follows: | |||||||||||||||||||||
31-Mar-15 | |||||||||||||||||||||
Carrying | Fair Value | ||||||||||||||||||||
Amount | Level 1 | Level 2 | Level 3 | Total | |||||||||||||||||
Financial assets: | (in thousands) | ||||||||||||||||||||
Cash and cash equivalents | $ | 35,447 | $ | 35,447 | $ | - | $ | - | $ | 35,447 | |||||||||||
Interest-bearing deposits in other financial institutions | 99 | 99 | - | - | 99 | ||||||||||||||||
FRB and FHLB stock | 3,089 | - | 3,089 | - | 3,089 | ||||||||||||||||
Investment securities | 31,054 | 56 | 31,482 | - | 31,538 | ||||||||||||||||
Loans, net | 485,801 | - | 489,191 | 10,949 | 500,140 | ||||||||||||||||
Financial liabilities: | |||||||||||||||||||||
Deposits | 495,670 | - | 496,289 | - | 496,289 | ||||||||||||||||
Other borrowings | 5,000 | - | 5,016 | - | 5,016 | ||||||||||||||||
31-Dec-14 | |||||||||||||||||||||
Carrying | Fair Value | ||||||||||||||||||||
Amount | Level 1 | Level 2 | Level 3 | Total | |||||||||||||||||
Financial assets: | (in thousands) | ||||||||||||||||||||
Cash and cash equivalents | $ | 18,959 | $ | 18,959 | $ | - | $ | - | $ | 18,959 | |||||||||||
Interest-bearing deposits in other financial institutions | 99 | 99 | - | - | 99 | ||||||||||||||||
FRB and FHLB stock | 3,089 | - | 3,089 | - | 3,089 | ||||||||||||||||
Investment securities | 30,641 | 61 | 31,027 | - | 31,088 | ||||||||||||||||
Loans, net | 487,256 | - | 490,193 | 10,405 | 500,598 | ||||||||||||||||
Financial liabilities: | |||||||||||||||||||||
Deposits | 477,084 | - | 477,204 | - | 477,204 | ||||||||||||||||
Other borrowings | 10,000 | - | 10,070 | - | 10,070 | ||||||||||||||||
The following methods and assumptions were used by the Company in estimating the fair value of its financial instruments: | |||||||||||||||||||||
Cash and cash equivalents | |||||||||||||||||||||
The carrying amounts reported in the consolidated balance sheets for cash and due from banks approximate their fair value. | |||||||||||||||||||||
Money market investments | |||||||||||||||||||||
The carrying amounts reported in the consolidated balance sheets for money market investments approximate their fair value. | |||||||||||||||||||||
Investment securities | |||||||||||||||||||||
The fair value of Farmer Mac class A stock is based on quoted market prices and are categorized as Level 1 of the fair value hierarchy. | |||||||||||||||||||||
The fair value of other investment securities were determined based on matrix pricing. Matrix pricing is a mathematical technique that utilizes observable market inputs including, for example, yield curves, credit ratings and prepayment speeds. Fair values determined using matrix pricing are generally categorized as Level 2 in the fair value hierarchy. | |||||||||||||||||||||
Federal Reserve Stock and Federal Home Loan Bank Stock | |||||||||||||||||||||
CWB is a member of the FHLB system and maintains an investment in capital stock of the FHLB. CWB also maintain an investment in capital stock of the Federal Reserve Bank ("FRB"). These investments are carried at cost since no ready market exists for them, and they have no quoted market value. The Company conducts a periodic review and evaluation of our FHLB stock to determine if any impairment exists. The fair values have been categorized as Level 2 in the fair value hierarchy. | |||||||||||||||||||||
Loans | |||||||||||||||||||||
Fair value for loans is estimated based on discounted cash flows using interest rates currently being offered for loans with similar terms to borrowers with similar credit quality with adjustments that the Company believes a market participant would consider in determining fair value based on a third party independent valuation. As a result, the fair value for loans is categorized as Level 2 in the fair value hierarchy. Fair values of impaired loans using a discounted cash flow method to measure impairment have been categorized as Level 3. | |||||||||||||||||||||
Deposits | |||||||||||||||||||||
The amount payable at demand at report date is used to estimate the fair value of demand and savings deposits. The estimated fair values of fixed-rate time deposits are determined by discounting the cash flows of segments of deposits that have similar maturities and rates, utilizing a discount rate that approximates the prevailing rates offered to depositors as of the measurement date. The fair value measurement of deposit liabilities is categorized as Level 2 in the fair value hierarchy. | |||||||||||||||||||||
Federal Home Loan Bank advances and other borrowings | |||||||||||||||||||||
The fair values of the Company's borrowings are estimated using discounted cash flow analyses, based on the market rates for similar types of borrowing arrangements. The other borrowings have been categorized as Level 3 in the fair value hierarchy. The FHLB advances have been categorized as Level 2 in the fair value hierarchy. | |||||||||||||||||||||
Off-balance sheet instruments | |||||||||||||||||||||
Fair values for the Company's off-balance sheet instruments (lending commitments and standby letters of credit) are based on quoted fees currently charged to enter into similar agreements, taking into account the remaining terms of the agreements and the counterparties' credit standing. | |||||||||||||||||||||
The estimated fair value of standby letters of credit outstanding at March 31, 2015 and December 31, 2014 was insignificant. Loan commitments on which the committed interest rates were less than the current market rate are also insignificant at March 31, 2015 and December 31, 2014. |
OTHER_BORROWINGS_AND_CONVERTIB
OTHER BORROWINGS AND CONVERTIBLE DEBENTURES | 3 Months Ended |
Mar. 31, 2015 | |
OTHER BORROWINGS AND CONVERTIBLE DEBENTURES [Abstract] | |
OTHER BORROWINGS AND CONVERTIBLE DEBENTURES | 7. OTHER BORROWINGS AND CONVERTIBLE DEBENTURES |
Federal Home Loan Bank Advances – The Company through the bank has a blanket lien credit line with the FHLB. FHLB advances are collateralized in the aggregate by CWB's eligible loans and securities. Total FHLB advances were $5.0 million at March 31, 2015 and $10.0 million at December 31, 2014, borrowed at fixed rates with a weighted average rate of 2.74%. The Company also had $50.0 million of letters of credit with FHLB at March 31, 2015 to secure public funds. At March 31, 2015 CWB had pledged to the FHLB, $31.0 million of securities and $81.2 million of loans. At March 31, 2015, CWB had $100.7 million available for additional borrowing. At December 31, 2014, CWB had pledged to the FHLB, $30.6 million of securities and $67.3 million of loans. At December 31, 2014, CWB had $106.2 million available for additional borrowing. Total FHLB interest expense for the three months ended March 31, 2015 and 2014 was $0.6 million and $0.2 million, respectively. | |
Federal Reserve Bank – CWB has established a credit line with the FRB. Advances are collateralized in the aggregate by eligible loans. There were no outstanding FRB advances as of March 31, 2015 and December 31, 2014. CWB had $91.3 million and $88.0 million in borrowing capacity as of March 31, 2015 and December 31, 2014, respectively. | |
Convertible Debentures - Effective March 10, 2014, the Company exercised its early redemption rights and called the outstanding debentures. All $1.4 million debentures were converted to 317,550 shares of common stock and $34,000 to cash. | |
Federal Funds Purchased Lines – The Company has federal funds borrowing lines at correspondent banks totaling $30.0 million.  There was no amount outstanding as of March 31, 2015 and December 31, 2014. |
STOCKHOLDERS_EQUITY
STOCKHOLDERS' EQUITY | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
STOCKHOLDERS' EQUITY [Abstract] | |||||||||
STOCKHOLDERS' EQUITY | 8 | STOCKHOLDERS' EQUITY | |||||||
The following table summarizes the changes in other comprehensive income by component, net of tax for the period indicated: | |||||||||
Three Months Ended | |||||||||
March 31, | |||||||||
2015 | 2014 | ||||||||
Unrealized holding gains (losses ) on AFS | |||||||||
(in thousands) | |||||||||
Beginning balance | $ | 31 | $ | (274 | ) | ||||
Other comprehensive income (loss) before reclassifications | (14 | ) | 95 | ||||||
Amounts reclassified from accumulated other comprehensive income | - | - | |||||||
Net current-period other comprehensive income | (14 | ) | 95 | ||||||
Ending Balance | $ | 17 | $ | (179 | ) | ||||
There were no reclassifications out of accumulated other comprehensive income for the three months ended March 31, 2015 or 2014. | |||||||||
Preferred Stock | |||||||||
The Company's Series A Preferred Stock paid cumulative dividends at a rate of 5% per year until February 15, 2014 then increased to a rate of 9% per year. The Series A Preferred Stock has no maturity date and ranks senior to the Common Stock with respect to the payment of dividends and distributions and amounts payable upon liquidation, dissolution and winding up of the Company. | |||||||||
During 2014, the Company completed redemption of 55% of the Series A Preferred Stock. The Company redeemed 8,586 shares of stock for $8.4 million and recognized a discount on the partial redemption of $0.2 million. | |||||||||
During the first quarter of 2015, the Company redeemed an additional $1.0 million of Series A Preferred Stock. | |||||||||
During the three months ended March 31, 2015 and 2014, the Company recorded $0.1 million and $0.3 million respectively, of dividends on preferred stock. | |||||||||
Common Stock Warrant | |||||||||
The Warrant issued as part of the TARP provides for the purchase of up to 521,158 shares of the common stock, at an exercise price of $4.49 per share ("Warrant Shares"). The Warrant is immediately exercisable and has a 10-year term. The exercise price and the ultimate number of shares of common stock that may be issued under the Warrant are subject to certain anti-dilution adjustments, such as upon stock splits or distributions of securities or other assets to holders of the common stock, and upon certain issuances of the common stock at or below a specified price relative to the then current market price of the common stock. In the second quarter of 2013, the Treasury sold its warrant position to a private investor.  Pursuant to the Securities Purchase Agreement, the private investor has agreed not to exercise voting power with respect to any Warrant Shares. | |||||||||
Common Stock | |||||||||
During the first quarter of 2014, the Company issued 316,872 shares of common stock in conjunction with debenture conversions. | |||||||||
During the three months ended March 31, 2015, the Company paid a quarterly common stock dividend of $0.2 million. There were no such dividends paid in the first quarter of 2014. |
EARNINGS_PER_SHARE
EARNINGS PER SHARE | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
EARNINGS PER SHARE [Abstract] | |||||||||
EARNINGS PER SHARE | 9. EARNINGS PER SHARE | ||||||||
The following table presents a reconciliation of basic earnings per share and diluted earnings per share: | |||||||||
Three Months Ended | |||||||||
March 31, | |||||||||
2015 | 2014 | ||||||||
(in thousands, except per share amounts) | |||||||||
Net income | $ | 1,770 | $ | 1,442 | |||||
Less: dividends and accretion on preferred stock and discount on partial redemption | 121 | 273 | |||||||
Net income available to common stockholders | $ | 1,649 | $ | 1,169 | |||||
Add: debenture interest expense and costs, net of income taxes | - | 103 | |||||||
Net income for diluted calculation of earnings per common share | $ | 1,649 | $ | 1,272 | |||||
Weighted average number of common shares outstanding - basic | 8,203 | 7,971 | |||||||
Weighted average number of common shares outstanding - diluted | 8,501 | 8,534 | |||||||
Earnings per share: | |||||||||
Basic | $ | 0.2 | $ | 0.15 | |||||
Diluted | $ | 0.19 | $ | 0.15 |
CAPITAL_REQUIREMENT
CAPITAL REQUIREMENT | 3 Months Ended | ||||||||||||||||||||||||||||||||||||
Mar. 31, 2015 | |||||||||||||||||||||||||||||||||||||
CAPITAL REQUIREMENT [Abstract] | |||||||||||||||||||||||||||||||||||||
CAPITAL REQUIREMENT | 10. CAPITAL REQUIREMENT | ||||||||||||||||||||||||||||||||||||
The Company and CWB are subject to various regulatory capital adequacy requirements administered by the Federal banking agencies. Failure to meet minimum capital requirements can initiate certain mandatory - and possibly additional discretionary - actions by regulators that, if undertaken, could have a direct material effect on the Company's business and financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Company and CWB must meet specific capital guidelines that involve quantitative measures of their assets, liabilities and certain off-balance sheet items as calculated under regulatory accounting practices. The capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk weightings and other factors. Prompt corrective action provisions are not applicable to bank holding companies. | |||||||||||||||||||||||||||||||||||||
Effective January 1, 2015, CWB was subject to the new guidelines for determining regulatory capital known as "Basel III." These capital rules among other things implement capital reforms and introduce a minimum Common Equity Tier 1 (CET1) ratio of 4.5% and a capital conservation buffer of 2.5%. Phase-in of the capital conservation buffer requirements will begin on January 1, 2016. | |||||||||||||||||||||||||||||||||||||
Effective March 31, 2015, CWBC met the requirements under the final rule changes to the Federal Reserve's Small Bank Holding Company Policy Statement for institutions with $500 million to $1 billion in total consolidated assets. Under the revised policy, CWBC is no longer subject to certain consolidated regulatory financial reporting requirements and is not subject to Base1 III capital rules and reporting requirements. | |||||||||||||||||||||||||||||||||||||
As of March 31, 2015 and December 31, 2014, the Company and CWB met the minimum capital ratio requirements to be classified as well-capitalized, as defined by the banking agencies. | |||||||||||||||||||||||||||||||||||||
The Company's and CWB's capital amounts and ratios as of March 31, 2015 and December 31, 2014 are presented in the table below: | |||||||||||||||||||||||||||||||||||||
Common | Risk- | Adjusted | Total Risk- | Tier 1 | Common | Tier 1 | |||||||||||||||||||||||||||||||
Total | Tier 1 | Equity Tier 1 | Weighted | Average | Based Capital | Risk-Based | Equity Tier 1 | Leverage | |||||||||||||||||||||||||||||
Capital | Capital | Capital | Assets | Assets | Ratio | Capital Ratio | Ratio | Ratio | |||||||||||||||||||||||||||||
31-Mar-15 | (dollars in thousands) | ||||||||||||||||||||||||||||||||||||
CWB | $ | 71,793 | $ | 66,082 | $ | 66,082 | $ | 455,301 | $ | 563,866 | 15.77 | % | 14.51 | % | 14.51 | % | 11.72 | % | |||||||||||||||||||
Well-capitalized ratios | 10 | % | 8 | % | 6.5 | % | 5 | % | |||||||||||||||||||||||||||||
Minimum capital ratios | 8 | % | 6 | % | 4.5 | % | 4 | % | |||||||||||||||||||||||||||||
December 31, 2014 (Under previous requirements) | |||||||||||||||||||||||||||||||||||||
CWBC (Consolidated) | $ | 72,569 | $ | 66,939 | N/ | A | $ | 448,199 | $ | 564,630 | 16.19 | % | 14.94 | % | N/ | A | 11.86 | % | |||||||||||||||||||
CWB | $ | 71,303 | $ | 65,673 | N/ | A | $ | 448,118 | $ | 564,331 | 15.91 | % | 14.66 | % | N/ | A | 11.64 | % | |||||||||||||||||||
Well-capitalized ratios | 10 | % | 6 | % | N/ | A | 5 | % | |||||||||||||||||||||||||||||
Minimum capital ratios | 8 | % | 4 | % | N/ | A | 4 | % |
SUMMARY_OF_SIGNIFICANT_ACCOUNT1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 3 Months Ended | ||
Mar. 31, 2015 | |||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [Abstract] | |||
Nature of operations | Nature of operations | ||
Community West Bancshares ("CWBC"), incorporated under the laws of the state of California, is a bank holding company providing full service banking through its wholly-owned subsidiary Community West Bank, N.A. ("CWB" or the "Bank"). These entities are collectively referred to herein as the "Company." | |||
Basis of presentation | Basis of presentation | ||
The accounting and reporting policies of the Company are in accordance with accounting principles generally accepted in the United States ("GAAP") and conform to practices within the financial services industry. The accounts of the Company and its consolidated subsidiary are included in these Consolidated Financial Statements. All significant intercompany balances and transactions have been eliminated. | |||
Use of estimates | Use of estimates | ||
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures 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 changes in the near term relate to the determination of the allowance for loan losses and fair value of other real estate owned. Although Management believes these estimates to be reasonably accurate, actual amounts may differ. In the opinion of Management, all adjustments considered necessary have been reflected in the financial statements during their preparation. | |||
Interim financial information | Interim financial information | ||
The accompanying unaudited consolidated financial statements as of and for the three months ended March 31, 2015 and 2014 have been prepared in a condensed format, and therefore do not include all of the information and footnotes required by GAAP for complete financial statements. These statements have been prepared on a basis that is substantially consistent with the accounting principles applied to our audited consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2014. | |||
The information furnished in these interim statements reflects all adjustments which are, in the opinion of management, necessary for a fair statement of the results for each respective period presented. Such adjustments are of a normal recurring nature. The results of operations in the interim statements are not necessarily indicative of the results that may be expected for any other quarter or for the full year. The interim financial information should be read in conjunction with the Company's audited consolidated financial statements. | |||
Reclassifications | Reclassifications | ||
Certain amounts in the consolidated financial statements as of December 31, 2014 and for the three months ended March 31, 2014 have been reclassified to conform to the current presentation. The reclassifications have no effect on net income, comprehensive income or stockholders' equity as previously reported. | |||
Loans Held for Sale | Loans Held For Sale | ||
Loans which are originated and intended for sale in the secondary market are carried at the lower of cost or estimated fair value determined on an aggregate basis. Valuation adjustments, if any, are recognized through a valuation allowance by charges to lower of cost or fair value provision. Loans held for sale are mostly comprised of SBA, commercial agriculture and single family residential loans. The Company did not incur any lower of cost or fair value provision in the three months ended March 31, 2015 and 2014. | |||
Loans Held for Investment and Interest and Fees from Loans | Loans Held for Investment and Interest and Fees from Loans | ||
Loans are recognized at the principal amount outstanding, net of unearned income, loan participations and amounts charged off. Unearned income includes deferred loan origination fees reduced by loan origination costs. Unearned income on loans is amortized to interest income over the life of the related loan using the level yield method. | |||
Interest income on loans is accrued daily using the effective interest method and recognized over the terms of the loans. Loan fees collected for the origination of loans less direct loan origination costs (net deferred loan fees) are amortized over the contractual life of the loan through interest income. If the loan has scheduled payments, the amortization of the net deferred loan fee is calculated using the interest method over the contractual life of the loan. If the loan does not have scheduled payments, such as a line of credit, the net deferred loan fee is recognized as interest income on a straight-line basis over the contractual life of the loan commitment. Commitment fees based on a percentage of a customer's unused line of credit and fees related to standby letters of credit are recognized over the commitment period. | |||
When loans are repaid, any remaining unamortized balances of unearned fees, deferred fees and costs and premiums and discounts paid on purchased loans are accounted for through interest income. | |||
Nonaccrual loans: For all loan types, when a borrower discontinues making payments as contractually required by the note, the Company must determine whether it is appropriate to continue to accrue interest. Generally, the Company places loans in a nonaccrual status and ceases recognizing interest income when the loan has become delinquent by more than 90 days or when Management determines that the full repayment of principal and collection of interest is unlikely. The Company may decide to continue to accrue interest on certain loans more than 90 days delinquent if they are well secured by collateral and in the process of collection. Other personal loans are typically charged off no later than 180 days delinquent. | |||
For all loan types, when a loan is placed on nonaccrual status, all interest accrued but uncollected is reversed against interest income in the period in which the status is changed. Subsequent payments received from the customer are applied to principal and no further interest income is recognized until the principal has been paid in full or until circumstances have changed such that payments are again consistently received as contractually required. The Company occasionally recognizes income on a cash basis for non-accrual loans in which the collection of the remaining principal balance is not in doubt. | |||
Impaired loans: A loan is considered impaired when, based on current information; it is probable that the Company will be unable to collect the scheduled payments of principal and/or interest under the contractual terms of the loan agreement. Factors considered by management in determining impairment include payment status, collateral value and the probability of collecting scheduled principal and/or interest payments. Loans that experience insignificant payment delays or payment shortfalls generally are not classified as impaired. Management determines the significance of payment delays or payment shortfalls on a case-by-case basis. When determining the possibility of impairment, management considers the circumstances surrounding the loan and the borrower, including the length of the delay, the reasons for the delay, the borrower's prior payment record and the amount of the shortfall in relation to the principal and interest owed. For collateral-dependent loans, the Company uses the fair value of collateral method to measure impairment. The collateral-dependent loans that recognize impairment are charged down to the fair value less costs to sell. All other loans are measured for impairment either based on the present value of future cash flows or the loan's observable market price. | |||
Troubled debt restructured loan ("TDR"): A TDR is a loan on which the Company, for reasons related to the borrower's financial difficulties, grants a concession to the borrower that the Company would not otherwise consider. These concessions included but are not limited to term extensions, rate reductions and principal reductions. Forgiveness of principal is rarely granted and modifications for all classes of loans are predominately term extensions. A TDR loan is also considered impaired. Generally, a loan that is modified at an effective market rate of interest may no longer be disclosed as a troubled debt restructuring in years subsequent to the restructuring if it is not impaired based on the terms specified by the restructuring agreement. | |||
Allowance for Loan Losses and Provision for Credit Losses | Allowance for Loan Losses and Provision for Credit Losses | ||
The Company maintains a detailed, systematic analysis and procedural discipline to determine the amount of the allowance for loan losses ("ALL"). The ALL is based on estimates and is intended to be appropriate to provide for probable losses inherent in the loan portfolio. This process involves deriving probable loss estimates that are based on migration analysis and historical loss rates, in addition to qualitative factors that are based on management's judgment. The migration analysis and historical loss rate calculations are based on the annualized loss rates utilizing a twelve-quarter loss history. Migration analysis is utilized for the Commercial Real Estate ("CRE"), Commercial, Commercial Agriculture, Small Business Administration ("SBA"), Home Equity Line of Credit ("HELOC"), Single Family Residential, and Consumer portfolios. The historical loss rate method is utilized primarily for the Manufactured Housing portfolio. The migration analysis takes into account the risk rating of loans that are charged off in each loan category. Loans that are considered Doubtful are typically charged off. The following is a description of the characteristics of loan ratings. Loan ratings are reviewed as part of our normal loan monitoring process, but, at a minimum, updated on an annual basis. | |||
Outstanding – This is the highest quality rating that is assigned to any loan in the portfolio. These loans are made to the highest quality borrowers with strong financial statements and unquestionable repayment sources. Collateral securing these types of credits are generally cash deposits in the bank or marketable securities held in custody. | |||
Good – Loans rated in this category are strong loans, underwritten well, that bear little risk of loss to the Company. Loans in this category are loans to quality borrowers with very good financial statements that present an identifiable strong primary source and good secondary source of repayment. Generally, these credits are well collateralized by good quality and liquid assets or low loan to value market real estate. | |||
Pass - Loans rated in this category are acceptable loans, appropriately underwritten, bearing an ordinary risk of loss to the Company. Loans in this category are loans to quality borrowers with financial statements presenting a good primary source as well as an adequate secondary source of repayment. In the case of individuals, borrowers with this rating are quality borrowers demonstrating a reasonable level of secure income, a net worth adequate to support the loan and presenting a good primary source as well as an adequate secondary source of repayment. | |||
Watch – Acceptable credit that requires a temporary increase in attention by management. This can be caused by declines in sales, margins, liquidity or working capital. Generally the primary weakness is lack of current financial statements and industry issues. | |||
Special Mention - A Special Mention loan has potential weaknesses that require management's close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or in the institution's credit position at some future date. Special mention assets are not adversely classified and do not expose an institution to sufficient risk to warrant adverse classification. | |||
Substandard - 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. These loans have a well-defined weakness or weaknesses that jeopardize full collection of amounts due. They are characterized by the distinct possibility that the Company will sustain some loss if the borrower's deficiencies are not corrected. | |||
Doubtful - A loan classified Doubtful has all the weaknesses inherent in one classified Substandard with 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. The possibility of loss is extremely high, but because of certain important and reasonably specific pending factors, which may work to the advantage and strengthening of the loan, its classification as an estimated loss is deferred until its more exact status may be determined. Pending factors include proposed merger, acquisition or liquidation procedures, capital injection, perfecting liens on additional collateral and refinancing plans. | |||
Loss - Loans classified Loss are considered uncollectible and of such little value that their continuance as bankable loans is not warranted. This classification does not mean that the asset has absolutely no recovery or salvage value, but rather it is not practical or desirable to defer writing off this loan even though partial recovery may be realized in the future. Losses are taken in the period in which they are considered uncollectible. | |||
The Company's ALL is maintained at a level believed appropriate by management to absorb known and inherent probable losses on existing loans. The allowance is charged for losses when management believes that full recovery on the loan is unlikely. The following is the Company's policy regarding charging off loans. | |||
Commercial, CRE and SBA Loans | |||
Charge-offs on these loan categories are taken as soon as all or a portion of any loan balance is deemed to be uncollectible. A loan is considered impaired when, based on current information, it is probable that the Company will be unable to collect the scheduled payments of principal and/or interest under the contractual terms of the loan agreement. Factors considered by management in determining impairment include payment status, collateral value and the probability of collecting scheduled principal and/or interest payments. Loans that experience insignificant payment delays or payment shortfalls generally are not classified as impaired. Generally, loan balances are charged-down to the fair value of the collateral, if, based on a current assessment of the value, an apparent deficiency exists. In the event there is no perceived equity, the loan is charged-off in full. Unsecured loans which are delinquent over 90 days are also charged-off in full. | |||
Single Family Real Estate, HELOC's and Manufactured Housing Loans | |||
Consumer loans and residential mortgages secured by one-to-four family residential properties, HELOC and manufactured housing loans in which principal or interest is due and unpaid for 90 days, are evaluated for impairment. Loan balances are charged-off to the fair value of the property, less estimated selling costs, if, based on a current appraisal, an apparent deficiency exists. In the event there is no perceived equity, the loan is generally fully charged-off. Other consumer loans which are not secured and unpaid over 90-120 days are charged-off in full. | |||
Consumer Loans | |||
All consumer loans (excluding real estate mortgages, HELOCs and savings secured loans) are charged-off or charged-down to net recoverable value before becoming 120 days or five payments delinquent. | |||
The ALL calculation for the different loan portfolios is as follows: | |||
· | Commercial Real Estate, Commercial, Commercial Agriculture, SBA, HELOC, Single Family Residential, and Consumer – Migration analysis combined with risk rating is used to determine the required ALL for all non-impaired loans. In addition, the migration results are adjusted based upon qualitative factors that affect this specific portfolio category. Reserves on impaired loans are determined based upon the individual characteristics of the loan. | ||
· | Manufactured Housing – The ALL is calculated on the basis of loss history and risk rating, which is primarily a function of delinquency. In addition, the loss results are adjusted based upon qualitative factors that affect this specific portfolio. | ||
The Company evaluates and individually assesses for impairment loans generally greater than $500,000, classified as substandard or doubtful in addition to loans either on nonaccrual, considered a TDR or when other conditions exist which lead management to review for possible impairment.  Measurement of impairment on impaired loans is determined on a loan-by-loan basis and in total establishes a specific reserve for impaired loans. The amount of impairment is determined by comparing the recorded investment in each loan with its value measured by one of three methods: | |||
· | The expected future cash flows are estimated and then discounted at the effective interest rate. | ||
· | The value of the underlying collateral net of selling costs. Selling costs are estimated based on industry standards, the Company's actual experience or actual costs incurred as appropriate. When evaluating real estate collateral, the Company typically uses appraisals or valuations, no more than twelve months old at time of evaluation. When evaluating non-real estate collateral securing the loan, the Company will use audited financial statements or appraisals no more than twelve months old at time of evaluation. Additionally, for both real estate and non-real estate collateral, the Company may use other sources to determine value as deemed appropriate. | ||
· | The loan's observable market price. | ||
Interest income is not recognized on impaired loans except for limited circumstances in which a loan, although impaired, continues to perform in accordance with the loan contract and the borrower provides financial information to support maintaining the loan on accrual. | |||
The Company determines the appropriate ALL on a monthly basis. Any differences between estimated and actual observed losses from the prior month are reflected in the current period in determining the appropriate ALL determination and adjusted as deemed necessary. The review of the appropriateness of the allowance takes into consideration such factors as concentrations of credit, changes in the growth, size and composition of the loan portfolio, overall and individual portfolio quality, review of specific problem loans, collateral, guarantees and economic and environmental conditions that may affect the borrowers' ability to pay and/or the value of the underlying collateral. Additional factors considered include: geographic location of borrowers, changes in the Company's product-specific credit policy and lending staff experience. These estimates depend on the outcome of future events and, therefore, contain inherent uncertainties. | |||
Another component of the ALL considers qualitative factors related to non-impaired loans. The qualitative portion of the allowance on each of the loan pools is based on the following factors: | |||
· | Concentrations of credit | ||
· | International risk | ||
· | Trends in volume, maturity, and composition | ||
· | Volume and trend in delinquency | ||
· | Economic conditions | ||
· | Outside exams | ||
· | Geographic distance | ||
· | Policy and changes | ||
· | Staff experience and ability | ||
Off Balance Sheet and Credit Exposure | Off Balance Sheet and Credit Exposure | ||
In the ordinary course of business, the Company has entered into off-balance sheet financial instruments consisting of commitments to extend credit and standby letters of credit. Such financial instruments are recorded in the consolidated financial statements when they are funded. They involve, to varying degrees, elements of credit risk in excess of amounts recognized in the consolidated balance sheets. Losses would be experienced when the Company is contractually obligated to make a payment under these instruments and must seek repayment from the borrower, which may not be as financially sound in the current period as they were when the commitment was originally made. Commitments to extend credit are agreements to lend to a customer as long as there is no violation of any condition established in the contract. Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. The Company enters into credit arrangements that generally provide for the termination of advances in the event of a covenant violation or other event of default. Since many 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 party. The commitments are collateralized by the same types of assets used as loan collateral. | |||
As with outstanding loans, the Company applies qualitative factors and utilization rates to its off-balance sheet obligations in determining an estimate of losses inherent in these contractual obligations. The estimate for loan losses on off-balance sheet instruments is included within other liabilities and the charge to income that establishes this liability is include in non-interest expense. | |||
Foreclosed Real Estate and Repossessed Assets | Foreclosed Real Estate and Repossessed Assets | ||
Foreclosed real estate and other repossessed assets are recorded at fair value at the time of foreclosure less estimated costs to sell. Any excess of loan balance over the fair value less estimated costs to sell of the other assets is charged-off against the allowance for loan losses. Any excess of the fair value less estimated costs to sell over the loan balance is recorded as a loan loss recovery to the extent of the loan loss previously charged-off against the allowance for loan losses; and, if greater, recorded as a gain on foreclosed assets. Subsequent to the legal ownership date, the Company periodically performs a new valuation and the asset is carried at the lower of carrying amount or fair value less estimated costs to sell. Operating expenses or income, and gains or losses on disposition of such properties, are recorded in current operations. | |||
Income Taxes | Income Taxes | ||
The Company uses the asset and liability method, which recognizes an asset or liability representing the tax effects of future deductible or taxable amounts that have been recognized in the consolidated financial statements. Due to tax regulations, certain items of income and expense are recognized in different periods for tax return purposes than for financial statement reporting. These items represent "temporary differences." Deferred income taxes are recognized for the tax effect of temporary differences between the tax basis of assets and liabilities and their financial reporting amounts at each period end based on enacted tax laws and statutory tax rates applicable to the periods in which the differences are expected to affect taxable income. A valuation allowance is established for deferred tax assets if, based on weight of available evidence, it is more likely than not that some portion or all of the deferred tax assets may not be realized. Any interest or penalties assessed by the taxing authorities is classified in the financial statements as income tax expense. Deferred tax assets are included in other assets on the consolidated balance sheets. | |||
Management evaluates the Company's deferred tax asset for recoverability using a consistent approach which considers the relative impact of negative and positive evidence, including the Company's historical profitability and projections of future taxable income. The Company is required to establish a valuation allowance for deferred tax assets and record a charge to income if management determines, based on available evidence at the time the determination is made, that it is more likely than not that some portion or all of the deferred tax assets may not be realized. | |||
The Company is subject to the provisions of ASC 740, Income Taxes ("ASC 740"). ASC 740 prescribes a more-likely-than-not threshold for the financial statement recognition of uncertain tax positions. ASC 740 clarifies the accounting for income taxes by prescribing a minimum recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. On a quarterly basis, the Company evaluates income tax accruals in accordance with ASC 740 guidance on uncertain tax positions. | |||
Earnings Per Share | Earnings Per Share | ||
Basic earnings per common share is computed using the weighted average number of common shares outstanding for the period divided into the net income available to common shareholders. Diluted earnings per share include the effect of all dilutive potential common shares for the period. Potentially dilutive common shares include stock options and warrants. | |||
Recent Accounting Pronouncements | Recent Accounting Pronouncements | ||
In January 2014, the FASB issued guidance within ASU 2014-04, "Receivables - Troubled Debt Restructurings by Creditors: Reclassification of Residential Real Estate Collateralized Consumer Mortgage Loans upon Foreclosure." The amendments in ASU 2014-04, Subtopic 310-40, Receivables -Troubled Debt Restructurings by Creditors, clarify that an in-substance repossession or foreclosure occurs, and a creditor is considered to have received physical possession of residential real estate property collateralizing a consumer mortgage loan, upon either (1) the creditor obtaining legal title to the residential real estate property upon completion of a foreclosure, or (2) 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. Additionally, the amendments require interim and annual disclosure of both (1) the amount of foreclosed residential real estate property held by the creditor and (2) the recorded investment in consumer mortgage loans collateralized by residential real estate property that are in the process of foreclosure according to local requirements of the applicable jurisdiction.  ASC 2014-04 are effective for the Company using either a modified retrospective transition method or a prospective transition method for reporting periods beginning after December 15, 2014. The adoption of this standard did not have a material impact on the Company's consolidated financial statements. | |||
In May 2014, the FASB issued guidance codified within ASU 2014-09, "Revenue Recognition - Revenue from Contracts with Customers," which amends the guidance in former Topic 605, Revenue Recognition. The new revenue recognition standard will supersede virtually all revenue guidance in U.S. GAAP, including industry specific guidance. The guidance in this Update affects any entity that either enters into contracts with customers to transfer goods or services or enters into contracts for the transfer of nonfinancial assets, unless those contracts are within the scope of other standards. ASU 2014-09 is effective for the Company for annual reporting periods beginning after December 15, 2016. The Company may elect to apply the amendments of this Update using one of the following two methods: 1) retrospectively to each prior reporting period presented or 2) retrospectively with the cumulative effect of initially applying this Update recognized at the date of initial application. The Company is currently evaluating the impact of the provisions in this standard on the Company's consolidated financial statements. |
INVESTMENT_SECURITIES_Tables
INVESTMENT SECURITIES (Tables) | 3 Months Ended | ||||||||||||||||||||||||||||||||||||||||
Mar. 31, 2015 | |||||||||||||||||||||||||||||||||||||||||
INVESTMENT SECURITIES [Abstract] | |||||||||||||||||||||||||||||||||||||||||
Amortized Cost and Estimated Fair Value of Investment Securities | The amortized cost and estimated fair value of investment securities are as follows: | ||||||||||||||||||||||||||||||||||||||||
31-Mar-15 | |||||||||||||||||||||||||||||||||||||||||
Gross | Gross | ||||||||||||||||||||||||||||||||||||||||
Amortized | Unrealized | Unrealized | Fair | ||||||||||||||||||||||||||||||||||||||
Cost | Gains | (Losses) | Value | ||||||||||||||||||||||||||||||||||||||
Securities available-for-sale | (in thousands) | ||||||||||||||||||||||||||||||||||||||||
U.S. government agency notes | $ | 9,340 | $ | 45 | $ | (53 | ) | $ | 9,332 | ||||||||||||||||||||||||||||||||
U.S. government agency collateralized mortgage obligations ("CMO") | 13,688 | 90 | (43 | ) | 13,735 | ||||||||||||||||||||||||||||||||||||
Equity securities: Farmer Mac class A stock | 66 | - | (10 | ) | 56 | ||||||||||||||||||||||||||||||||||||
Total | $ | 23,094 | $ | 135 | $ | (106 | ) | $ | 23,123 | ||||||||||||||||||||||||||||||||
Securities held-to-maturity | |||||||||||||||||||||||||||||||||||||||||
U.S. government agency MBS | $ | 7,931 | $ | 484 | $ | - | $ | 8,415 | |||||||||||||||||||||||||||||||||
Total | $ | 7,931 | $ | 484 | $ | - | $ | 8,415 | |||||||||||||||||||||||||||||||||
31-Dec-14 | |||||||||||||||||||||||||||||||||||||||||
Gross | Gross | ||||||||||||||||||||||||||||||||||||||||
Amortized | Unrealized | Unrealized | Fair | ||||||||||||||||||||||||||||||||||||||
Cost | Gains | (Losses) | Value | ||||||||||||||||||||||||||||||||||||||
Securities available-for-sale | (in thousands) | ||||||||||||||||||||||||||||||||||||||||
U.S. government agency notes | $ | 7,846 | $ | 65 | $ | (49 | ) | $ | 7,862 | ||||||||||||||||||||||||||||||||
U.S. government agency collateralized mortgage obligations ("CMO") | 14,229 | 73 | (31 | ) | 14,271 | ||||||||||||||||||||||||||||||||||||
Equity securities: Farmer Mac class A stock | 66 | - | (5 | ) | 61 | ||||||||||||||||||||||||||||||||||||
Total | $ | 22,141 | $ | 138 | $ | (85 | ) | $ | 22,194 | ||||||||||||||||||||||||||||||||
Securities held-to-maturity | |||||||||||||||||||||||||||||||||||||||||
U.S. government agency MBS | $ | 8,447 | $ | 447 | $ | - | $ | 8,894 | |||||||||||||||||||||||||||||||||
Total | $ | 8,447 | $ | 447 | $ | - | $ | 8,894 | |||||||||||||||||||||||||||||||||
Maturity Periods and Weighted Average Yields of Investment Securities | The maturity periods and weighted average yields of investment securities at March 31, 2015 and December 31, 2014 were as follows: | ||||||||||||||||||||||||||||||||||||||||
31-Mar-15 | |||||||||||||||||||||||||||||||||||||||||
Less than One Year | One to Five Years | Five to Ten Years | Over Ten Years | Total | |||||||||||||||||||||||||||||||||||||
Amount | Yield | Amount | Yield | Amount | Yield | Amount | Yield | Amount | Yield | ||||||||||||||||||||||||||||||||
Securities available-for-sale | (dollars in thousands) | ||||||||||||||||||||||||||||||||||||||||
U.S. government agency notes | $ | 7,074 | 2.6 | % | $ | - | - | $ | 2,258 | 0.9 | % | $ | - | - | $ | 9,332 | 2.2 | % | |||||||||||||||||||||||
U.S. government agency CMO | 448 | 0.6 | % | 6,916 | 1.1 | % | 2,736 | 0.6 | % | 3,635 | 1.1 | % | 13,735 | 1 | % | ||||||||||||||||||||||||||
Farmer Mac class A stock | - | - | - | - | - | - | - | - | 56 | - | |||||||||||||||||||||||||||||||
Total | $ | 7,522 | 2.4 | % | $ | 6,916 | 1.1 | % | $ | 4,994 | 0.7 | % | $ | 3,635 | 1.1 | % | $ | 23,123 | 1.3 | % | |||||||||||||||||||||
Securities held-to-maturity | |||||||||||||||||||||||||||||||||||||||||
U.S. government agency MBS | $ | - | - | $ | 5,344 | 3.3 | % | $ | 2,587 | 2.2 | % | $ | - | - | $ | 7,931 | 3 | % | |||||||||||||||||||||||
Total | $ | - | - | $ | 5,344 | 3.3 | % | $ | 2,587 | 2.2 | % | $ | - | - | $ | 7,931 | 3 | % | |||||||||||||||||||||||
31-Dec-14 | |||||||||||||||||||||||||||||||||||||||||
Less than One Year | One to Five Years | Five to Ten Years | Over Ten Years | Total | |||||||||||||||||||||||||||||||||||||
Amount | Yield | Amount | Yield | Amount | Yield | Amount | Yield | Amount | Yield | ||||||||||||||||||||||||||||||||
Securities available-for-sale | (dollars in thousands) | ||||||||||||||||||||||||||||||||||||||||
U.S. government agency notes | $ | 7,862 | 2.5 | % | $ | - | - | $ | - | - | $ | - | - | $ | 7,862 | 2.5 | % | ||||||||||||||||||||||||
U.S. government agency CMO | - | - | 7,826 | 1 | % | 2,801 | 0.6 | % | 3,644 | 1.1 | % | 14,271 | 1.1 | % | |||||||||||||||||||||||||||
Farmer Mac class A stock | - | - | - | - | - | - | - | - | 61 | - | |||||||||||||||||||||||||||||||
Total | $ | 7,862 | 2.5 | % | $ | 7,826 | 1 | % | $ | 2,801 | 0.6 | % | $ | 3,644 | 1.1 | % | $ | 22,194 | 1.3 | % | |||||||||||||||||||||
Securities held-to-maturity | |||||||||||||||||||||||||||||||||||||||||
U.S. government agency MBS | $ | - | - | $ | 3,235 | 4 | % | $ | 5,212 | 2.4 | % | $ | - | - | $ | 8,447 | 2.9 | % | |||||||||||||||||||||||
Total | $ | - | - | $ | 3,235 | 4 | % | $ | 5,212 | 2.4 | % | $ | - | - | $ | 8,447 | 2.9 | % | |||||||||||||||||||||||
Amortized Cost and Fair Value of Investment Securities by Contractual Maturities | The amortized cost and fair value of investment securities by contractual maturities as of the periods presented were as shown below: | ||||||||||||||||||||||||||||||||||||||||
March 31, | December 31, | ||||||||||||||||||||||||||||||||||||||||
2015 | 2014 | ||||||||||||||||||||||||||||||||||||||||
Amortized | Estimated | Amortized | Estimated | ||||||||||||||||||||||||||||||||||||||
Cost | Fair Value | Cost | Fair Value | ||||||||||||||||||||||||||||||||||||||
Securities available for sale | (in thousands) | ||||||||||||||||||||||||||||||||||||||||
Due in one year or less | $ | 7,519 | $ | 7,522 | $ | 7,846 | $ | 7,862 | |||||||||||||||||||||||||||||||||
After one year through five years | 6,872 | 6,916 | 7,798 | 7,826 | |||||||||||||||||||||||||||||||||||||
After five years through ten years | 5,001 | 4,994 | 2,792 | 2,801 | |||||||||||||||||||||||||||||||||||||
After ten years | 3,636 | 3,635 | 3,639 | 3,644 | |||||||||||||||||||||||||||||||||||||
Farmer Mac class A stock | 66 | 56 | 66 | 61 | |||||||||||||||||||||||||||||||||||||
$ | 23,094 | $ | 23,123 | $ | 22,141 | $ | 22,194 | ||||||||||||||||||||||||||||||||||
Securities held to maturity | |||||||||||||||||||||||||||||||||||||||||
Due in one year or less | $ | - | $ | - | $ | - | $ | - | |||||||||||||||||||||||||||||||||
After one year through five years | 5,344 | 5,697 | 3,235 | 3,479 | |||||||||||||||||||||||||||||||||||||
After five years through ten years | 2,587 | 2,718 | 5,212 | 5,415 | |||||||||||||||||||||||||||||||||||||
After ten years | - | - | - | - | |||||||||||||||||||||||||||||||||||||
$ | 7,931 | $ | 8,415 | $ | 8,447 | $ | 8,894 | ||||||||||||||||||||||||||||||||||
Fair Value and Unrealized Losses of Securities in Unrealized Loss Position | The following tables show all securities that are in an unrealized loss position: | ||||||||||||||||||||||||||||||||||||||||
31-Mar-15 | |||||||||||||||||||||||||||||||||||||||||
Less Than Twelve Months | More Than Twelve Months | Total | |||||||||||||||||||||||||||||||||||||||
Gross | Gross | Gross | |||||||||||||||||||||||||||||||||||||||
Unrealized | Fair | Unrealized | Fair | Unrealized | Fair | ||||||||||||||||||||||||||||||||||||
Losses | Value | Losses | Value | Losses | Value | ||||||||||||||||||||||||||||||||||||
Securities available-for-sale | (in thousands) | ||||||||||||||||||||||||||||||||||||||||
U.S. government agency notes | $ | 53 | $ | 5,348 | $ | - | $ | - | $ | 53 | $ | 5,348 | |||||||||||||||||||||||||||||
U.S. government agency CMO | - | - | 43 | 3,895 | 43 | 3,895 | |||||||||||||||||||||||||||||||||||
Equity securities: Farmer Mac class A stock | 10 | 56 | - | - | 10 | 56 | |||||||||||||||||||||||||||||||||||
$ | 63 | $ | 5,404 | $ | 43 | $ | 3,895 | $ | 106 | $ | 9,299 | ||||||||||||||||||||||||||||||
Securities held-to-maturity | |||||||||||||||||||||||||||||||||||||||||
U.S. Government-agency MBS | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | |||||||||||||||||||||||||||||
Total | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | |||||||||||||||||||||||||||||
31-Dec-14 | |||||||||||||||||||||||||||||||||||||||||
Less Than Twelve Months | More Than Twelve Months | Total | |||||||||||||||||||||||||||||||||||||||
Gross | Gross | Gross | |||||||||||||||||||||||||||||||||||||||
Unrealized | Fair | Unrealized | Fair | Unrealized | Fair | ||||||||||||||||||||||||||||||||||||
Losses | Value | Losses | Value | Losses | Value | ||||||||||||||||||||||||||||||||||||
Securities available-for-sale | (in thousands) | ||||||||||||||||||||||||||||||||||||||||
U.S. government agency notes | $ | 23 | $ | 1,918 | $ | 26 | $ | 3,971 | $ | 49 | $ | 5,889 | |||||||||||||||||||||||||||||
U.S. government agency CMO | - | - | 31 | 4,090 | 31 | 4,090 | |||||||||||||||||||||||||||||||||||
Equity securities: Farmer Mac class A stock | 5 | 61 | - | - | 5 | 61 | |||||||||||||||||||||||||||||||||||
$ | 28 | $ | 1,979 | $ | 57 | $ | 8,061 | $ | 85 | $ | 10,040 | ||||||||||||||||||||||||||||||
Securities held-to-maturity | |||||||||||||||||||||||||||||||||||||||||
U.S. Government-agency MBS | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | |||||||||||||||||||||||||||||
Total | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - |
LOAN_SALES_AND_SERVICING_Table
LOAN SALES AND SERVICING (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
Interest Only Strips [Member] | |||||||||
Schedule of Interest Only Strips and Servicing Rights [Line Items] | |||||||||
Summary of Activity for Interest Only Strips and Servicing Rights at Fair Value | The following table presents the I/O strips activity as of the periods presented: | ||||||||
Three Months Ended | |||||||||
March 31, | |||||||||
2015 | 2014 | ||||||||
(in thousands) | |||||||||
Beginning balance | $ | 293 | $ | 334 | |||||
Adjustment to fair value | (7 | ) | - | ||||||
Ending balance | $ | 286 | $ | 334 | |||||
Assumptions Used in Estimating the Fair Value | The key data assumptions used in estimating the fair value of the I/O strips as of the periods presented were as follows: | ||||||||
March 31, | |||||||||
2015 | 2014 | ||||||||
Weighted-average constant prepayment rate | 5.64 | % | 5.29 | % | |||||
Weighted-average life (in years) | 6 | 6 | |||||||
Weighted-average discount rate | 10.35 | % | 11.89 | % | |||||
Sensitivity Analysis of Fair Value | A sensitivity analysis of the fair value of the I/O strips to changes in certain key assumptions is presented in the following table: | ||||||||
March 31, | |||||||||
2015 | 2014 | ||||||||
( in thousands) | |||||||||
Discount Rate | |||||||||
Increase in fair value from 100 basis point decrease | $ | 8 | $ | 9 | |||||
Decrease in fair value from 100 basis point increase | (8 | ) | (9 | ) | |||||
Constant Prepayment Rate | |||||||||
Increase in fair value from 10 percent decrease | 4 | 5 | |||||||
Decrease in fair value from 10 percent increase | (4 | ) | (5 | ) | |||||
Servicing Rights [Member] | |||||||||
Schedule of Interest Only Strips and Servicing Rights [Line Items] | |||||||||
Summary of Activity for Interest Only Strips and Servicing Rights at Fair Value | The following is a summary of the activity for servicing assets accounted for under the fair value method: | ||||||||
Three Months Ended | |||||||||
2015 | 2014 | ||||||||
(in thousands) | |||||||||
Beginning balance | $ | 203 | $ | 300 | |||||
Adjustment to fair value | 6 | (38 | ) | ||||||
Ending balance | $ | 209 | $ | 262 | |||||
Assumptions Used in Estimating the Fair Value | The key data and assumptions used in estimating the fair value of servicing assets as of the periods presented were as follows: | ||||||||
March 31, | |||||||||
2015 | 2014 | ||||||||
Weighted-average constant prepayment rate | 6.23 | % | 5.52 | % | |||||
Weighted-average life (in years) | 8 | 9 | |||||||
Weighted-average discount rate | 10.63 | % | 11.93 | % | |||||
Sensitivity Analysis of Fair Value | A sensitivity analysis of the fair value of servicing assets to change in certain key assumptions is presented in the following table: | ||||||||
March 31, | |||||||||
2015 | 2014 | ||||||||
(in thousands) | |||||||||
Discount Rate | |||||||||
Increase in fair value from 100 basis points decrease | $ | 9 | $ | 11 | |||||
Decrease in fair value from 100 basis points increase | (9 | ) | (10 | ) | |||||
Constant Prepayment Rate | |||||||||
Increase in fair value from 10 percent decrease | 6 | 6 | |||||||
Decrease in fair value from 10 percent increase | (5 | ) | (6 | ) | |||||
Summary of Activity for Servicing Assets Accounted for under Amortization Method | The following is a summary of the activity for servicing assets accounted for under the amortization method: | ||||||||
Three Months Ended | |||||||||
March 31, | |||||||||
2015 | 2014 | ||||||||
(in thousands) | |||||||||
Beginning balance | $ | 167 | $ | 268 | |||||
Amortization | (8 | ) | (28 | ) | |||||
Ending balance | $ | 159 | $ | 240 |
LOANS_HELD_FOR_INVESTMENT_Tabl
LOANS HELD FOR INVESTMENT (Tables) | 3 Months Ended | ||||||||||||||||||||||||||||||||
Mar. 31, 2015 | |||||||||||||||||||||||||||||||||
LOANS HELD FOR INVESTMENT [Abstract] | |||||||||||||||||||||||||||||||||
Portfolio of Loans Held for Investment | The composition of the Company's loans held for investment loan portfolio follows: | ||||||||||||||||||||||||||||||||
March 31, | December 31, | ||||||||||||||||||||||||||||||||
2015 | 2014 | ||||||||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||
Manufactured housing | $ | 169,751 | $ | 169,662 | |||||||||||||||||||||||||||||
Commercial real estate | 163,163 | 159,432 | |||||||||||||||||||||||||||||||
Commercial | 48,598 | 49,683 | |||||||||||||||||||||||||||||||
SBA | 20,302 | 21,336 | |||||||||||||||||||||||||||||||
HELOC | 13,130 | 13,481 | |||||||||||||||||||||||||||||||
Single family real estate | 14,606 | 14,957 | |||||||||||||||||||||||||||||||
Consumer | 156 | 178 | |||||||||||||||||||||||||||||||
429,706 | 428,729 | ||||||||||||||||||||||||||||||||
Allowance for loan losses | 7,275 | 7,877 | |||||||||||||||||||||||||||||||
Deferred fees, net | 128 | 118 | |||||||||||||||||||||||||||||||
Discount on SBA loans | 226 | 237 | |||||||||||||||||||||||||||||||
Total loans held for investment, net | $ | 422,077 | $ | 420,497 | |||||||||||||||||||||||||||||
Current and Past Due Financing Receivable | The following table presents the contractual aging of the recorded investment in past due held for investment loans by class of loans: | ||||||||||||||||||||||||||||||||
31-Mar-15 | |||||||||||||||||||||||||||||||||
Recorded | |||||||||||||||||||||||||||||||||
Investment | |||||||||||||||||||||||||||||||||
30-59 Days | 60-89 Days | Over 90 Days | Total | Over 90 Days | |||||||||||||||||||||||||||||
Current | Past Due | Past Due | Past Due | Past Due | Total | and Accruing | |||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||
Manufactured housing | $ | 169,283 | $ | 188 | $ | 155 | $ | 125 | $ | 468 | $ | 169,751 | $ | - | |||||||||||||||||||
Commercial real estate: | |||||||||||||||||||||||||||||||||
Commercial real estate | 119,206 | - | - | 1,342 | 1,342 | 120,548 | - | ||||||||||||||||||||||||||
SBA 504 1st trust deed | 28,596 | - | - | - | - | 28,596 | - | ||||||||||||||||||||||||||
Land | 1,561 | - | - | - | - | 1,561 | - | ||||||||||||||||||||||||||
Construction | 12,458 | - | - | - | - | 12,458 | - | ||||||||||||||||||||||||||
Commercial | 48,356 | 242 | - | - | 242 | 48,598 | - | ||||||||||||||||||||||||||
SBA | 20,248 | 2 | 52 | - | 54 | 20,302 | - | ||||||||||||||||||||||||||
HELOC | 13,066 | - | - | 64 | 64 | 13,130 | - | ||||||||||||||||||||||||||
Single family real estate | 14,606 | - | - | - | 14,606 | - | |||||||||||||||||||||||||||
Consumer | 156 | - | - | - | - | 156 | - | ||||||||||||||||||||||||||
Total | $ | 427,536 | $ | 432 | $ | 207 | $ | 1,531 | $ | 2,170 | $ | 429,706 | $ | - | |||||||||||||||||||
31-Dec-14 | |||||||||||||||||||||||||||||||||
Recorded | |||||||||||||||||||||||||||||||||
Investment | |||||||||||||||||||||||||||||||||
30-59 Days | 60-89 Days | Over 90 Days | Total | Over 90 Days | |||||||||||||||||||||||||||||
Current | Past Due | Past Due | Past Due | Past Due | Total | and Accruing | |||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||
Manufactured housing | $ | 169,233 | $ | 239 | $ | - | $ | 190 | $ | 429 | $ | 169,662 | $ | - | |||||||||||||||||||
Commercial real estate: | |||||||||||||||||||||||||||||||||
Commercial real estate | 119,090 | 632 | - | 186 | 818 | 119,908 | - | ||||||||||||||||||||||||||
SBA 504 1st trust deed | 27,297 | - | - | - | - | 27,297 | - | ||||||||||||||||||||||||||
Land | 1,569 | - | - | - | - | 1,569 | - | ||||||||||||||||||||||||||
Construction | 10,658 | - | - | - | - | 10,658 | - | ||||||||||||||||||||||||||
Commercial | 49,683 | - | - | - | - | 49,683 | - | ||||||||||||||||||||||||||
SBA | 21,333 | 3 | - | - | 3 | 21,336 | - | ||||||||||||||||||||||||||
HELOC | 13,459 | - | - | 22 | 22 | 13,481 | - | ||||||||||||||||||||||||||
Single family real estate | 14,821 | - | 136 | 136 | 14,957 | - | |||||||||||||||||||||||||||
Consumer | 178 | - | - | - | - | 178 | - | ||||||||||||||||||||||||||
Total | $ | 427,321 | $ | 874 | $ | - | $ | 534 | $ | 1,408 | $ | 428,729 | $ | - | |||||||||||||||||||
Analysis of Allowance for Loan Losses for Loans Held for Investment | The following table summarizes the changes in the allowance for loan losses: | ||||||||||||||||||||||||||||||||
Three Months Ended | |||||||||||||||||||||||||||||||||
March 31, | |||||||||||||||||||||||||||||||||
2015 | 2014 | ||||||||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||
Beginning balance | $ | 7,877 | $ | 12,208 | |||||||||||||||||||||||||||||
Charge-offs | (131 | ) | (252 | ) | |||||||||||||||||||||||||||||
Recoveries | 497 | 771 | |||||||||||||||||||||||||||||||
Net (charge-offs) recoveries | 366 | 519 | |||||||||||||||||||||||||||||||
Provision | (968 | ) | (1,371 | ) | |||||||||||||||||||||||||||||
Ending balance | $ | 7,275 | $ | 11,356 | |||||||||||||||||||||||||||||
As of March 31, 2015 and December 31, 2014, the Company had reserves for credit losses on undisbursed loans of $37,000 and $39,000, respectively which were included in Other liabilities. | |||||||||||||||||||||||||||||||||
The following tables summarize the changes in the allowance for loan losses by portfolio type: | |||||||||||||||||||||||||||||||||
For the Three Months Ended March 31, | |||||||||||||||||||||||||||||||||
Manufactured | Commercial | Single Family | |||||||||||||||||||||||||||||||
Housing | Real Estate | Commercial | SBA | HELOC | Real Estate | Consumer | Total | ||||||||||||||||||||||||||
2015 | (in thousands) | ||||||||||||||||||||||||||||||||
Beginning balance | $ | 4,032 | $ | 1,459 | $ | 986 | $ | 1,066 | $ | 140 | $ | 192 | $ | 2 | $ | 7,877 | |||||||||||||||||
Charge-offs | (131 | ) | - | - | - | - | - | - | (131 | ) | |||||||||||||||||||||||
Recoveries | 49 | 13 | 321 | 110 | 3 | 1 | - | 497 | |||||||||||||||||||||||||
Net charge-offs | (82 | ) | 13 | 321 | 110 | 3 | 1 | - | 366 | ||||||||||||||||||||||||
Provision | 88 | 105 | (707 | ) | (298 | ) | (90 | ) | (68 | ) | 2 | (968 | ) | ||||||||||||||||||||
Ending balance | $ | 4,038 | $ | 1,577 | $ | 600 | $ | 878 | $ | 53 | $ | 125 | $ | 4 | $ | 7,275 | |||||||||||||||||
2014 | |||||||||||||||||||||||||||||||||
Beginning balance | $ | 5,114 | $ | 2,552 | $ | 2,064 | $ | 1,951 | $ | 280 | $ | 245 | $ | 2 | $ | 12,208 | |||||||||||||||||
Charge-offs | (240 | ) | - | - | (12 | ) | - | - | - | (252 | ) | ||||||||||||||||||||||
Recoveries | 36 | 639 | 29 | 51 | 15 | 1 | - | 771 | |||||||||||||||||||||||||
Net charge-offs | (204 | ) | 639 | 29 | 39 | 15 | 1 | - | 519 | ||||||||||||||||||||||||
Provision | (30 | ) | (907 | ) | (265 | ) | (132 | ) | (30 | ) | (7 | ) | - | (1,371 | ) | ||||||||||||||||||
Ending balance | $ | 4,880 | $ | 2,284 | $ | 1,828 | $ | 1,858 | $ | 265 | $ | 239 | $ | 2 | $ | 11,356 | |||||||||||||||||
Schedule of Impaired Loans by Loan Class | The following tables present impairment method information related to loans and allowance for loan losses by loan portfolio segment: | ||||||||||||||||||||||||||||||||
Manufactured | Commercial | Single Family | Total | ||||||||||||||||||||||||||||||
Housing | Real Estate | Commercial | SBA | HELOC | Real Estate | Consumer | Loans | ||||||||||||||||||||||||||
Loans Held for Investment as of March 31, 2015: | (in thousands) | ||||||||||||||||||||||||||||||||
Recorded Investment: | |||||||||||||||||||||||||||||||||
Impaired loans with an allowance recorded | $ | 3,237 | $ | 1,443 | $ | 2,854 | $ | 1,674 | $ | 21 | $ | 71 | $ | - | $ | 9,300 | |||||||||||||||||
Impaired loans with no allowance recorded | 4,033 | 1,813 | 44 | 149 | 63 | 460 | - | 6,562 | |||||||||||||||||||||||||
Total loans individually evaluated for impairment | 7,270 | 3,256 | 2,898 | 1,823 | 84 | 531 | - | 15,862 | |||||||||||||||||||||||||
Loans collectively evaluated for impairment | 162,481 | 159,907 | 45,700 | 18,479 | 13,046 | 14,075 | 156 | 413,844 | |||||||||||||||||||||||||
Total loans held for investment | $ | 169,751 | $ | 163,163 | $ | 48,598 | $ | 20,302 | $ | 13,130 | $ | 14,606 | $ | 156 | $ | 429,706 | |||||||||||||||||
Unpaid Principal Balance | |||||||||||||||||||||||||||||||||
Impaired loans with an allowance recorded | $ | 3,278 | $ | 1,622 | $ | 3,543 | $ | 7,837 | $ | 21 | $ | 71 | $ | - | $ | 16,372 | |||||||||||||||||
Impaired loans with no allowance recorded | 5,900 | 3,923 | 50 | 1,678 | 69 | 612 | - | 12,232 | |||||||||||||||||||||||||
Total loans individually evaluated for impairment | 9,178 | 5,545 | 3,593 | 9,515 | 90 | 683 | - | 28,604 | |||||||||||||||||||||||||
Loans collectively evaluated for impairment | 162,481 | 159,907 | 45,700 | 18,479 | 13,046 | 14,075 | 156 | 413,844 | |||||||||||||||||||||||||
Total loans held for investment | $ | 171,659 | $ | 165,452 | $ | 49,293 | $ | 27,994 | $ | 13,136 | $ | 14,758 | $ | 156 | $ | 442,448 | |||||||||||||||||
Related Allowance for Credit Losses | |||||||||||||||||||||||||||||||||
Impaired loans with an allowance recorded | $ | 428 | $ | 15 | $ | 50 | $ | 183 | $ | - | $ | 10 | $ | - | $ | 686 | |||||||||||||||||
Impaired loans with no allowance recorded | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||
Total loans individually evaluated for impairment | 428 | 15 | 50 | 183 | - | 10 | - | 686 | |||||||||||||||||||||||||
Loans collectively evaluated for impairment | 3,610 | 1,562 | 550 | 695 | 53 | 115 | 4 | 6,589 | |||||||||||||||||||||||||
Total loans held for investment | $ | 4,038 | $ | 1,577 | $ | 600 | $ | 878 | $ | 53 | $ | 125 | $ | 4 | $ | 7,275 | |||||||||||||||||
Manufactured | Commercial | Single Family | Total | ||||||||||||||||||||||||||||||
Housing | Real Estate | Commercial | SBA | HELOC | Real Estate | Consumer | Loans | ||||||||||||||||||||||||||
Loans Held for Investment as of December 31, 2014: | (in thousands) | ||||||||||||||||||||||||||||||||
Recorded Investment: | |||||||||||||||||||||||||||||||||
Impaired loans with an allowance recorded | $ | 4,717 | $ | 2,783 | $ | 3,122 | $ | 1,837 | $ | 86 | $ | 591 | $ | - | $ | 13,136 | |||||||||||||||||
Impaired loans with no allowance recorded | 2,734 | 831 | 44 | 4 | - | 90 | - | 3,703 | |||||||||||||||||||||||||
Total loans individually evaluated for impairment | 7,451 | 3,614 | 3,166 | 1,841 | 86 | 681 | - | 16,839 | |||||||||||||||||||||||||
Loans collectively evaluated for impairment | 162,211 | 155,818 | 46,517 | 19,495 | 13,395 | 14,276 | 178 | 411,890 | |||||||||||||||||||||||||
Total loans held for investment | $ | 169,662 | $ | 159,432 | $ | 49,683 | $ | 21,336 | $ | 13,481 | $ | 14,957 | $ | 178 | $ | 428,729 | |||||||||||||||||
Unpaid Principal Balance | |||||||||||||||||||||||||||||||||
Impaired loans with an allowance recorded | $ | 5,172 | $ | 2,979 | $ | 4,914 | $ | 9,512 | $ | 91 | $ | 644 | $ | - | $ | 23,312 | |||||||||||||||||
Impaired loans with no allowance recorded | 4,243 | 2,895 | 50 | 225 | - | 191 | - | 7,604 | |||||||||||||||||||||||||
Total loans individually evaluated for impairment | 9,415 | 5,874 | 4,964 | 9,737 | 91 | 835 | - | 30,916 | |||||||||||||||||||||||||
Loans collectively evaluated for impairment | 162,211 | 155,818 | 46,517 | 19,495 | 13,395 | 14,276 | 178 | 411,890 | |||||||||||||||||||||||||
Total loans held for investment | $ | 171,626 | $ | 161,692 | $ | 51,481 | $ | 29,232 | $ | 13,486 | $ | 15,111 | $ | 178 | $ | 442,806 | |||||||||||||||||
Related Allowance for Credit Losses | |||||||||||||||||||||||||||||||||
Impaired loans with an allowance recorded | $ | 399 | $ | 77 | $ | 241 | $ | 104 | $ | 1 | $ | 32 | $ | - | $ | 854 | |||||||||||||||||
Impaired loans with no allowance recorded | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||
Total loans individually evaluated for impairment | 399 | 77 | 241 | 104 | 1 | 32 | - | 854 | |||||||||||||||||||||||||
Loans collectively evaluated for impairment | 3,633 | 1,382 | 745 | 962 | 139 | 160 | 2 | 7,023 | |||||||||||||||||||||||||
Total loans held for investment | $ | 4,032 | $ | 1,459 | $ | 986 | $ | 1,066 | $ | 140 | $ | 192 | $ | 2 | $ | 7,877 | |||||||||||||||||
Recorded Investment in Certain Loans | The table below reflects recorded investment in loans classified as impaired: | ||||||||||||||||||||||||||||||||
March 31, | December 31, | ||||||||||||||||||||||||||||||||
2015 | 2014 | ||||||||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||
Impaired loans with a specific valuation allowance under ASC 310 | $ | 9,300 | $ | 13,136 | |||||||||||||||||||||||||||||
Impaired loans without a specific valuation allowance under ASC 310 | 6,562 | 3,703 | |||||||||||||||||||||||||||||||
Total impaired loans | $ | 15,862 | $ | 16,839 | |||||||||||||||||||||||||||||
Valuation allowance related to impaired loans | $ | 686 | $ | 854 | |||||||||||||||||||||||||||||
The following tables summarize impaired loans by class of loans: | |||||||||||||||||||||||||||||||||
March 31, | December 31, | ||||||||||||||||||||||||||||||||
2015 | 2014 | ||||||||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||
Manufactured housing | $ | 7,270 | $ | 7,451 | |||||||||||||||||||||||||||||
Commercial real estate : | |||||||||||||||||||||||||||||||||
Commercial real estate | 2,262 | 2,320 | |||||||||||||||||||||||||||||||
SBA 504 1st trust deed | 994 | 1,294 | |||||||||||||||||||||||||||||||
Commercial | 2,898 | 3,166 | |||||||||||||||||||||||||||||||
SBA | 1,823 | 1,841 | |||||||||||||||||||||||||||||||
HELOC | 84 | 86 | |||||||||||||||||||||||||||||||
Single family real estate | 531 | 681 | |||||||||||||||||||||||||||||||
Total | $ | 15,862 | $ | 16,839 | |||||||||||||||||||||||||||||
The following table summarizes average investment in impaired loans by class of loans and the related interest income recognized: | |||||||||||||||||||||||||||||||||
Three Months Ended | |||||||||||||||||||||||||||||||||
March 31, | |||||||||||||||||||||||||||||||||
2015 | 2014 | ||||||||||||||||||||||||||||||||
Average Investment | Interest | Average Investment | Interest | ||||||||||||||||||||||||||||||
in Impaired Loans | Income | in Impaired Loans | Income | ||||||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||
Manufactured housing | $ | 7,288 | $ | 115 | $ | 8,862 | $ | 59 | |||||||||||||||||||||||||
Commercial real estate: | |||||||||||||||||||||||||||||||||
Commercial real estate | 2,269 | - | 2,728 | - | |||||||||||||||||||||||||||||
SBA 504 1st trust deed | 1,133 | 9 | 768 | 5 | |||||||||||||||||||||||||||||
Land | - | - | 140 | - | |||||||||||||||||||||||||||||
Commercial | 3,003 | - | 3,662 | 14 | |||||||||||||||||||||||||||||
SBA | 1,814 | 11 | 1,770 | 3 | |||||||||||||||||||||||||||||
HELOC | 85 | - | 597 | 5 | |||||||||||||||||||||||||||||
Single family real estate | 600 | 1 | 740 | 1 | |||||||||||||||||||||||||||||
Consumer | - | - | - | - | |||||||||||||||||||||||||||||
Total | $ | 16,192 | $ | 136 | $ | 19,267 | $ | 87 | |||||||||||||||||||||||||
The Company is not committed to lend additional funds on these impaired loans. | |||||||||||||||||||||||||||||||||
The following table reflects the recorded investment in certain types of loans at the periods indicated: | |||||||||||||||||||||||||||||||||
March 31, | December 31, | ||||||||||||||||||||||||||||||||
2015 | 2014 | ||||||||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||
Nonaccrual loans | $ | 16,048 | $ | 17,883 | |||||||||||||||||||||||||||||
SBA guaranteed portion of loans included above | (5,566 | ) | (6,856 | ) | |||||||||||||||||||||||||||||
Total nonaccrual loans, net | $ | 10,482 | $ | 11,027 | |||||||||||||||||||||||||||||
Troubled debt restructured loans, gross | $ | 9,462 | $ | 9,685 | |||||||||||||||||||||||||||||
Loans 30 through 89 days past due with interest accruing | $ | 513 | $ | - | |||||||||||||||||||||||||||||
Allowance for loan losses to gross loans held for investment | 1.69 | % | 1.84 | % | |||||||||||||||||||||||||||||
Composition of Net Nonaccrual Loans | The following table presents the composition of nonaccrual loans, net of government guarantees, by class of loans: | ||||||||||||||||||||||||||||||||
March 31, | December 31, | ||||||||||||||||||||||||||||||||
2015 | 2014 | ||||||||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||
Manufactured housing | $ | 1,735 | $ | 1,480 | |||||||||||||||||||||||||||||
Commercial real estate: | |||||||||||||||||||||||||||||||||
Commercial real estate | 2,887 | 2,951 | |||||||||||||||||||||||||||||||
SBA 504 1st trust deed | 724 | 1,021 | |||||||||||||||||||||||||||||||
Commercial | 2,898 | 3,167 | |||||||||||||||||||||||||||||||
SBA | 1,693 | 1,713 | |||||||||||||||||||||||||||||||
HELOC | 85 | 86 | |||||||||||||||||||||||||||||||
Single family real estate | 460 | 609 | |||||||||||||||||||||||||||||||
Total | $ | 10,482 | $ | 11,027 | |||||||||||||||||||||||||||||
Schedule of Loans by Rating | The following tables present gross loans by risk rating: | ||||||||||||||||||||||||||||||||
31-Mar-15 | |||||||||||||||||||||||||||||||||
Special | |||||||||||||||||||||||||||||||||
Pass | Mention | Substandard | Doubtful | Total | |||||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||
Manufactured housing | $ | 164,852 | $ | - | $ | 4,899 | $ | - | $ | 169,751 | |||||||||||||||||||||||
Commercial real estate: | |||||||||||||||||||||||||||||||||
Commercial real estate | 107,265 | 6,918 | 6,365 | - | 120,548 | ||||||||||||||||||||||||||||
SBA 504 1st trust deed | 23,531 | 1,744 | 3,321 | - | 28,596 | ||||||||||||||||||||||||||||
Land | 1,561 | - | - | - | 1,561 | ||||||||||||||||||||||||||||
Construction | 12,458 | - | - | - | 12,458 | ||||||||||||||||||||||||||||
Commercial | 45,199 | 398 | 3,001 | - | 48,598 | ||||||||||||||||||||||||||||
SBA | 11,837 | 270 | 1,875 | 91 | 14,073 | ||||||||||||||||||||||||||||
HELOC | 12,288 | - | 842 | - | 13,130 | ||||||||||||||||||||||||||||
Single family real estate | 13,961 | - | 645 | - | 14,606 | ||||||||||||||||||||||||||||
Consumer | 156 | - | - | - | 156 | ||||||||||||||||||||||||||||
Total, net | $ | 393,108 | $ | 9,330 | $ | 20,948 | $ | 91 | $ | 423,477 | |||||||||||||||||||||||
SBA guarantee | - | - | 6,229 | - | 6,229 | ||||||||||||||||||||||||||||
Total | $ | 393,108 | $ | 9,330 | $ | 27,177 | $ | 91 | $ | 429,706 | |||||||||||||||||||||||
31-Dec-14 | |||||||||||||||||||||||||||||||||
Special | |||||||||||||||||||||||||||||||||
Pass | Mention | Substandard | Doubtful | Total | |||||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||
Manufactured housing | $ | 162,638 | $ | - | $ | 7,024 | $ | - | $ | 169,662 | |||||||||||||||||||||||
Commercial real estate: | |||||||||||||||||||||||||||||||||
Commercial real estate | 106,909 | 6,544 | 6,455 | - | 119,908 | ||||||||||||||||||||||||||||
SBA 504 1st trust deed | 23,038 | 1,085 | 3,174 | - | 27,297 | ||||||||||||||||||||||||||||
Land | 1,569 | - | - | - | 1,569 | ||||||||||||||||||||||||||||
Construction | 10,658 | - | - | - | 10,658 | ||||||||||||||||||||||||||||
Commercial | 46,275 | 158 | 3,250 | - | 49,683 | ||||||||||||||||||||||||||||
SBA | 12,803 | 173 | 1,891 | 97 | 14,964 | ||||||||||||||||||||||||||||
HELOC | 12,888 | - | 593 | - | 13,481 | ||||||||||||||||||||||||||||
Single family real estate | 14,105 | - | 852 | - | 14,957 | ||||||||||||||||||||||||||||
Consumer | 178 | - | - | - | 178 | ||||||||||||||||||||||||||||
Total, net | $ | 391,061 | $ | 7,960 | $ | 23,239 | $ | 97 | $ | 422,357 | |||||||||||||||||||||||
SBA guarantee | - | - | 6,372 | - | 6,372 | ||||||||||||||||||||||||||||
Total | $ | 391,061 | $ | 7,960 | $ | 29,611 | $ | 97 | $ | 428,729 | |||||||||||||||||||||||
Troubled Debt Restructurings | The following tables summarize the financial effects of TDR loans by loan class for the periods presented: | ||||||||||||||||||||||||||||||||
For the Three Months Ended March 31, 2015 | |||||||||||||||||||||||||||||||||
Pre- | Post | Balance of | Balance of | Effect on | |||||||||||||||||||||||||||||
Number | Modification | Modification | Loans with | Loans with | Allowance for | ||||||||||||||||||||||||||||
of Loans | Recorded Investment | Recorded Investment | Rate Reduction | Term Extension | Loan Losses | ||||||||||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||||||||
Manufactured housing | 3 | $ | 174 | $ | 174 | $ | - | $ | 156 | $ | 4 | ||||||||||||||||||||||
Total | 3 | $ | 174 | $ | 174 | $ | - | $ | 156 | $ | 4 | ||||||||||||||||||||||
For the Three Months Ended March 31, 2014 | |||||||||||||||||||||||||||||||||
Pre- | Post | Balance of | Balance of | Effect on | |||||||||||||||||||||||||||||
Number | Modification | Modification | Loans with | Loans with | Allowance for | ||||||||||||||||||||||||||||
of Loans | Recorded Investment | Recorded Investment | Rate Reduction | Term Extension | Loan Losses | ||||||||||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||||||||
Manufactured housing | 4 | $ | 187 | $ | 187 | 187 | $ | 187 | 5 | ||||||||||||||||||||||||
Total | 4 | $ | 187 | $ | 187 | $ | 187 | $ | 187 | $ | 5 | ||||||||||||||||||||||
The average rate concessions were 0 basis points and 63 basis points for the three months ended March 31, 2015 and 2014, respectively. The average term extension in months was 13 and 180 for the first quarter of 2015 and 2014, respectively. | |||||||||||||||||||||||||||||||||
The following tables present TDR's by class for which there was a payment default during the period: | |||||||||||||||||||||||||||||||||
Three Months Ended | |||||||||||||||||||||||||||||||||
March 31, | |||||||||||||||||||||||||||||||||
2015 | 2014 | ||||||||||||||||||||||||||||||||
Number | Recorded | Effect on | Number | Recorded | Effect on | ||||||||||||||||||||||||||||
of Loans | Investment | Allowance for | of Loans | Investment | Allowance for | ||||||||||||||||||||||||||||
Loan Losses | Loan Losses | ||||||||||||||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||||||||
Manufactured housing | - | $ | - | $ | - | 1 | $ | 18 | $ | 5 | |||||||||||||||||||||||
Total | - | $ | - | $ | - | 1 | $ | 18 | $ | 5 |
OTHER_ASSETS_ACQUIRED_THROUGH_1
OTHER ASSETS ACQUIRED THROUGH FORECLOSURE (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
OTHER ASSETS ACQUIRED THROUGH FORECLOSURE [Abstract] | |||||||||
Other Assets Acquired through Foreclosure | The following table summarizes the changes in other assets acquired through foreclosure: | ||||||||
Three Months Ended | |||||||||
March 31, | |||||||||
2015 | 2014 | ||||||||
(in thousands) | |||||||||
Balance, beginning of period | $ | 137 | $ | 3,811 | |||||
Additions | 222 | 403 | |||||||
Proceeds from dispositions and receivables from participants | (40 | ) | (393 | ) | |||||
Gains (losses) on sales, net | 1 | (40 | ) | ||||||
Balance, end of period | $ | 320 | $ | 3,781 |
FAIR_VALUE_MEASUREMENT_Tables
FAIR VALUE MEASUREMENT (Tables) | 3 Months Ended | ||||||||||||||||||||
Mar. 31, 2015 | |||||||||||||||||||||
FAIR VALUE MEASUREMENT [Abstract] | |||||||||||||||||||||
Summary of Fair Value Measurements of Assets Measured on a Recurring Basis | The following tables summarize the fair value of assets measured on a recurring basis: | ||||||||||||||||||||
Fair Value Measurements at the End of the Reporting Period Using: | |||||||||||||||||||||
Quoted Prices | |||||||||||||||||||||
in Active | Significant | ||||||||||||||||||||
Markets for | Other | Significant | |||||||||||||||||||
Identical | Observable | Unobservable | |||||||||||||||||||
Assets | Inputs | Inputs | Fair | ||||||||||||||||||
31-Mar-15 | (Level 1) | (Level 2) | (Level 3) | Value | |||||||||||||||||
Assets: | (in thousands) | ||||||||||||||||||||
Investment securities available-for-sale | $ | 56 | $ | 23,067 | $ | - | $ | 23,123 | |||||||||||||
Interest only strips | - | - | 286 | 286 | |||||||||||||||||
Servicing assets | - | - | 209 | 209 | |||||||||||||||||
$ | 56 | $ | 23,067 | $ | 495 | $ | 23,618 | ||||||||||||||
Fair Value Measurements at the End of the Reporting Period Using: | |||||||||||||||||||||
Quoted Prices | |||||||||||||||||||||
in Active | Significant | ||||||||||||||||||||
Markets for | Other | Significant | |||||||||||||||||||
Identical | Observable | Unobservable | |||||||||||||||||||
Assets | Inputs | Inputs | Fair | ||||||||||||||||||
31-Dec-14 | (Level 1) | (Level 2) | (Level 3) | Value | |||||||||||||||||
Assets: | (in thousands) | ||||||||||||||||||||
Investment securities available-for-sale | $ | 61 | $ | 22,133 | $ | - | $ | 22,194 | |||||||||||||
Interest only strips | - | - | 293 | 293 | |||||||||||||||||
Servicing assets | - | - | 203 | 203 | |||||||||||||||||
$ | 61 | $ | 22,133 | $ | 496 | $ | 22,690 | ||||||||||||||
Summary of Fair Value Measurements of Assets Measured on a Non-recurring Basis | The following summarizes the fair value measurements of assets measured on a non-recurring basis: | ||||||||||||||||||||
Fair Value Measurements at the End of the Reporting Period Using | |||||||||||||||||||||
Quoted Prices | |||||||||||||||||||||
in Active | Active | ||||||||||||||||||||
Markets for | Markets for | Unobservable | |||||||||||||||||||
Identical Assets | Similar Assets | Inputs | |||||||||||||||||||
Total | (Level 1) | (Level 2) | (Level 3) | ||||||||||||||||||
(in thousands) | |||||||||||||||||||||
As of March 31, 2015: | |||||||||||||||||||||
Impaired loans | $ | 4,227 | $ | - | $ | 4,227 | $ | - | |||||||||||||
Loans held for sale | 68,268 | - | 68,268 | - | |||||||||||||||||
Foreclosed real estate and repossessed assets | 320 | - | 320 | - | |||||||||||||||||
$ | 72,815 | $ | - | $ | 72,815 | $ | - | ||||||||||||||
As of December 31, 2014: | |||||||||||||||||||||
Impaired loans | $ | 5,580 | $ | - | $ | 5,580 | $ | - | |||||||||||||
Loans held for sale | 71,475 | - | 71,475 | - | |||||||||||||||||
Foreclosed real estate and repossessed assets | 137 | - | 137 | - | |||||||||||||||||
$ | 77,192 | $ | - | $ | 77,192 | $ | - | ||||||||||||||
Estimated fair values and carrying values of financial instruments | The estimated fair value of the Company's financial instruments are as follows: | ||||||||||||||||||||
31-Mar-15 | |||||||||||||||||||||
Carrying | Fair Value | ||||||||||||||||||||
Amount | Level 1 | Level 2 | Level 3 | Total | |||||||||||||||||
Financial assets: | (in thousands) | ||||||||||||||||||||
Cash and cash equivalents | $ | 35,447 | $ | 35,447 | $ | - | $ | - | $ | 35,447 | |||||||||||
Interest-bearing deposits in other financial institutions | 99 | 99 | - | - | 99 | ||||||||||||||||
FRB and FHLB stock | 3,089 | - | 3,089 | - | 3,089 | ||||||||||||||||
Investment securities | 31,054 | 56 | 31,482 | - | 31,538 | ||||||||||||||||
Loans, net | 485,801 | - | 489,191 | 10,949 | 500,140 | ||||||||||||||||
Financial liabilities: | |||||||||||||||||||||
Deposits | 495,670 | - | 496,289 | - | 496,289 | ||||||||||||||||
Other borrowings | 5,000 | - | 5,016 | - | 5,016 | ||||||||||||||||
31-Dec-14 | |||||||||||||||||||||
Carrying | Fair Value | ||||||||||||||||||||
Amount | Level 1 | Level 2 | Level 3 | Total | |||||||||||||||||
Financial assets: | (in thousands) | ||||||||||||||||||||
Cash and cash equivalents | $ | 18,959 | $ | 18,959 | $ | - | $ | - | $ | 18,959 | |||||||||||
Interest-bearing deposits in other financial institutions | 99 | 99 | - | - | 99 | ||||||||||||||||
FRB and FHLB stock | 3,089 | - | 3,089 | - | 3,089 | ||||||||||||||||
Investment securities | 30,641 | 61 | 31,027 | - | 31,088 | ||||||||||||||||
Loans, net | 487,256 | - | 490,193 | 10,405 | 500,598 | ||||||||||||||||
Financial liabilities: | |||||||||||||||||||||
Deposits | 477,084 | - | 477,204 | - | 477,204 | ||||||||||||||||
Other borrowings | 10,000 | - | 10,070 | - | 10,070 |
STOCKHOLDERS_EQUITY_Tables
STOCKHOLDERS' EQUITY (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
STOCKHOLDERS' EQUITY [Abstract] | |||||||||
Schedule of Accumulated Other Comprehensive Income (Loss) | The following table summarizes the changes in other comprehensive income by component, net of tax for the period indicated: | ||||||||
Three Months Ended | |||||||||
March 31, | |||||||||
2015 | 2014 | ||||||||
Unrealized holding gains (losses ) on AFS | |||||||||
(in thousands) | |||||||||
Beginning balance | $ | 31 | $ | (274 | ) | ||||
Other comprehensive income (loss) before reclassifications | (14 | ) | 95 | ||||||
Amounts reclassified from accumulated other comprehensive income | - | - | |||||||
Net current-period other comprehensive income | (14 | ) | 95 | ||||||
Ending Balance | $ | 17 | $ | (179 | ) |
EARNINGS_PER_SHARE_Tables
EARNINGS PER SHARE (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
EARNINGS PER SHARE [Abstract] | |||||||||
Reconciliation of Basic and Diluted Earnings per Share | The following table presents a reconciliation of basic earnings per share and diluted earnings per share: | ||||||||
Three Months Ended | |||||||||
March 31, | |||||||||
2015 | 2014 | ||||||||
(in thousands, except per share amounts) | |||||||||
Net income | $ | 1,770 | $ | 1,442 | |||||
Less: dividends and accretion on preferred stock and discount on partial redemption | 121 | 273 | |||||||
Net income available to common stockholders | $ | 1,649 | $ | 1,169 | |||||
Add: debenture interest expense and costs, net of income taxes | - | 103 | |||||||
Net income for diluted calculation of earnings per common share | $ | 1,649 | $ | 1,272 | |||||
Weighted average number of common shares outstanding - basic | 8,203 | 7,971 | |||||||
Weighted average number of common shares outstanding - diluted | 8,501 | 8,534 | |||||||
Earnings per share: | |||||||||
Basic | $ | 0.2 | $ | 0.15 | |||||
Diluted | $ | 0.19 | $ | 0.15 |
CAPITAL_REQUIREMENT_Tables
CAPITAL REQUIREMENT (Tables) | 3 Months Ended | ||||||||||||||||||||||||||||||||||||
Mar. 31, 2015 | |||||||||||||||||||||||||||||||||||||
CAPITAL REQUIREMENT [Abstract] | |||||||||||||||||||||||||||||||||||||
Company's and CWB's Capital Amounts and Ratios | The Company's and CWB's capital amounts and ratios as of March 31, 2015 and December 31, 2014 are presented in the table below: | ||||||||||||||||||||||||||||||||||||
Common | Risk- | Adjusted | Total Risk- | Tier 1 | Common | Tier 1 | |||||||||||||||||||||||||||||||
Total | Tier 1 | Equity Tier 1 | Weighted | Average | Based Capital | Risk-Based | Equity Tier 1 | Leverage | |||||||||||||||||||||||||||||
Capital | Capital | Capital | Assets | Assets | Ratio | Capital Ratio | Ratio | Ratio | |||||||||||||||||||||||||||||
31-Mar-15 | (dollars in thousands) | ||||||||||||||||||||||||||||||||||||
CWB | $ | 71,793 | $ | 66,082 | $ | 66,082 | $ | 455,301 | $ | 563,866 | 15.77 | % | 14.51 | % | 14.51 | % | 11.72 | % | |||||||||||||||||||
Well-capitalized ratios | 10 | % | 8 | % | 6.5 | % | 5 | % | |||||||||||||||||||||||||||||
Minimum capital ratios | 8 | % | 6 | % | 4.5 | % | 4 | % | |||||||||||||||||||||||||||||
December 31, 2014 (Under previous requirements) | |||||||||||||||||||||||||||||||||||||
CWBC (Consolidated) | $ | 72,569 | $ | 66,939 | N/ | A | $ | 448,199 | $ | 564,630 | 16.19 | % | 14.94 | % | N/ | A | 11.86 | % | |||||||||||||||||||
CWB | $ | 71,303 | $ | 65,673 | N/ | A | $ | 448,118 | $ | 564,331 | 15.91 | % | 14.66 | % | N/ | A | 11.64 | % | |||||||||||||||||||
Well-capitalized ratios | 10 | % | 6 | % | N/ | A | 5 | % | |||||||||||||||||||||||||||||
Minimum capital ratios | 8 | % | 4 | % | N/ | A | 4 | % |
SUMMARY_OF_SIGNIFICANT_ACCOUNT2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) (USD $) | 3 Months Ended |
Mar. 31, 2015 | |
Payment | |
Quarter | |
Nonaccrual loans [Abstract] | |
Period after which loans in accrual status | 90 days |
Period before which credit card loans and other personal loans typically charged off | 180 days |
Allowance for Loan Losses and Provision for Credit Losses [Abstract] | |
Period of loss history used for determining the amount of allowance of loan losses | 12 |
Number of delinquent payments | 5 |
Threshold amount of loans for evaluation of impairment | $500,000 |
Commercial, Commercial Real Estate and SBA Loans [Member] | |
Allowance for Loan Losses and Provision for Credit Losses [Abstract] | |
Number of days for unsecured loans to be charged off | 90 days |
Single Family Real Estate, HELOC's and Manufactured Loans [Member] | |
Allowance for Loan Losses and Provision for Credit Losses [Abstract] | |
Period of past due after which loan is considered as uncollectible | 90 days |
Single Family Real Estate, HELOC's and Manufactured Loans [Member] | Minimum [Member] | |
Allowance for Loan Losses and Provision for Credit Losses [Abstract] | |
Number of days for unsecured loans to be charged off | 90 days |
Single Family Real Estate, HELOC's and Manufactured Loans [Member] | Maximum [Member] | |
Allowance for Loan Losses and Provision for Credit Losses [Abstract] | |
Number of days for unsecured loans to be charged off | 120 days |
Consumer [Member] | |
Allowance for Loan Losses and Provision for Credit Losses [Abstract] | |
Period of past due after which loan is considered as uncollectible | 120 days |
INVESTMENT_SECURITIES_Details
INVESTMENT SECURITIES (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
Securities available-for-sale [Abstract] | ||
Amortized Cost | $23,094,000 | $22,141,000 |
Gross Unrealized Gains | 135,000 | 138,000 |
Gross Unrealized (Losses) | -106,000 | -85,000 |
Fair Value | 23,123,000 | 22,194,000 |
Securities held-to-maturity [Abstract] | ||
Amortized Cost | 7,931,000 | 8,447,000 |
Gross Unrealized Gains | 484,000 | 447,000 |
Gross Unrealized (Losses) | 0 | 0 |
Fair Value | 8,415,000 | 8,894,000 |
Available-for-sale and held to maturity securities disclosure [Abstract] | ||
Securities pledged as collateral | 31,000,000 | 30,600,000 |
U.S. Government Agency [Member] | Mortgage Backed Securities ("MBS") [Member] | ||
Securities held-to-maturity [Abstract] | ||
Amortized Cost | 7,931,000 | 8,447,000 |
Gross Unrealized Gains | 484,000 | 447,000 |
Gross Unrealized (Losses) | 0 | 0 |
Fair Value | 8,415,000 | 8,894,000 |
U.S. Government Agency [Member] | Notes [Member] | ||
Securities available-for-sale [Abstract] | ||
Amortized Cost | 9,340,000 | 7,846,000 |
Gross Unrealized Gains | 45,000 | 65,000 |
Gross Unrealized (Losses) | -53,000 | -49,000 |
Fair Value | 9,332,000 | 7,862,000 |
U.S. Government Agency [Member] | Collateralized Mortgage Obligations ("CMO") [Member] | ||
Securities available-for-sale [Abstract] | ||
Amortized Cost | 13,688,000 | 14,229,000 |
Gross Unrealized Gains | 90,000 | 73,000 |
Gross Unrealized (Losses) | -43,000 | -31,000 |
Fair Value | 13,735,000 | 14,271,000 |
Equity Securities: Farmer Mac Class A Stock [Member] | ||
Securities available-for-sale [Abstract] | ||
Amortized Cost | 66,000 | 66,000 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized (Losses) | -10,000 | -5,000 |
Fair Value | $56,000 | $61,000 |
INVESTMENT_SECURITIES_Maturity
INVESTMENT SECURITIES, Maturity Periods and Weighted Average Yields (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Thousands, unless otherwise specified | ||
Maturity periods and weighted average yields of investment securities available-for-sale [Abstract] | ||
Less than One Year, Amount | $7,522 | $7,862 |
Less than One Year, Yield (in hundredths) | 2.40% | 2.50% |
One to Five Years, Amount | 6,916 | 7,826 |
One to Five Years, Yield (in hundredths) | 1.10% | 1.00% |
Five to Ten Years, Amount | 4,994 | 2,801 |
Five to Ten Years, Yield (in hundredths) | 0.70% | 0.60% |
Over Ten Years, Amount | 3,635 | 3,644 |
Over Ten Years, Yield (in hundredths) | 1.10% | 1.10% |
Total Amount | 23,123 | 22,194 |
Total Yield (in hundredths) | 1.30% | 1.30% |
Maturity periods and weighted average yields of investment securities held-to-maturity [Abstract] | ||
Less than One Year, Amount | 0 | 0 |
Less than One Year, Yield (in hundredths) | 0.00% | 0.00% |
One to Five Years, Amount | 5,344 | 3,235 |
One to Five Years, Yield (in hundredths) | 3.30% | 4.00% |
Five to Ten Years, Amount | 2,587 | 5,212 |
Five to Ten Years, Yield (in hundredths) | 2.20% | 2.40% |
Over Ten Years, Amount | 0 | 0 |
Over Ten Years, Yield (in hundredths) | 0.00% | 0.00% |
Total Amount | 7,931 | 8,447 |
Total Yield (in hundredths) | 3.00% | 2.90% |
U.S. Government Agency [Member] | Mortgage Backed Securities ("MBS") [Member] | ||
Maturity periods and weighted average yields of investment securities held-to-maturity [Abstract] | ||
Less than One Year, Amount | 0 | 0 |
Less than One Year, Yield (in hundredths) | 0.00% | 0.00% |
One to Five Years, Amount | 5,344 | 3,235 |
One to Five Years, Yield (in hundredths) | 3.30% | 4.00% |
Five to Ten Years, Amount | 2,587 | 5,212 |
Five to Ten Years, Yield (in hundredths) | 2.20% | 2.40% |
Over Ten Years, Amount | 0 | 0 |
Over Ten Years, Yield (in hundredths) | 0.00% | 0.00% |
Total Amount | 7,931 | 8,447 |
Total Yield (in hundredths) | 3.00% | 2.90% |
U.S. Government Agency [Member] | Notes [Member] | ||
Maturity periods and weighted average yields of investment securities available-for-sale [Abstract] | ||
Less than One Year, Amount | 7,074 | 7,862 |
Less than One Year, Yield (in hundredths) | 2.60% | 2.50% |
One to Five Years, Amount | 0 | 0 |
One to Five Years, Yield (in hundredths) | 0.00% | 0.00% |
Five to Ten Years, Amount | 2,258 | 0 |
Five to Ten Years, Yield (in hundredths) | 0.90% | 0.00% |
Over Ten Years, Amount | 0 | 0 |
Over Ten Years, Yield (in hundredths) | 0.00% | 0.00% |
Total Amount | 9,332 | 7,862 |
Total Yield (in hundredths) | 2.20% | 2.50% |
U.S. Government Agency [Member] | Collateralized Mortgage Obligations ("CMO") [Member] | ||
Maturity periods and weighted average yields of investment securities available-for-sale [Abstract] | ||
Less than One Year, Amount | 448 | 0 |
Less than One Year, Yield (in hundredths) | 0.60% | 0.00% |
One to Five Years, Amount | 6,916 | 7,826 |
One to Five Years, Yield (in hundredths) | 1.10% | 1.00% |
Five to Ten Years, Amount | 2,736 | 2,801 |
Five to Ten Years, Yield (in hundredths) | 0.60% | 0.60% |
Over Ten Years, Amount | 3,635 | 3,644 |
Over Ten Years, Yield (in hundredths) | 1.10% | 1.10% |
Total Amount | 13,735 | 14,271 |
Total Yield (in hundredths) | 1.00% | 1.10% |
Equity Securities: Farmer Mac Class A Stock [Member] | ||
Maturity periods and weighted average yields of investment securities available-for-sale [Abstract] | ||
Less than One Year, Amount | 0 | 0 |
Less than One Year, Yield (in hundredths) | 0.00% | 0.00% |
One to Five Years, Amount | 0 | 0 |
One to Five Years, Yield (in hundredths) | 0.00% | 0.00% |
Five to Ten Years, Amount | 0 | 0 |
Five to Ten Years, Yield (in hundredths) | 0.00% | 0.00% |
Over Ten Years, Amount | 0 | 0 |
Over Ten Years, Yield (in hundredths) | 0.00% | 0.00% |
Total Amount | $56 | $61 |
Total Yield (in hundredths) | 0.00% | 0.00% |
INVESTMENT_SECURITIES_Amortize
INVESTMENT SECURITIES, Amortized Cost and Fair Value of Securities (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Thousands, unless otherwise specified | ||
Securities available-for-sale, Amortized Cost [Abstract] | ||
Due in one year or less | $7,519 | $7,846 |
After one year through five years | 6,872 | 7,798 |
After five years through ten years | 5,001 | 2,792 |
After ten years | 3,636 | 3,639 |
Farmer Mac class A stock | 66 | 66 |
Amortized Cost | 23,094 | 22,141 |
Securities available for sale, Estimated Fair Value [Abstract] | ||
Due in one year or less | 7,522 | 7,862 |
After one year through five years | 6,916 | 7,826 |
After five years through ten years | 4,994 | 2,801 |
After ten years | 3,635 | 3,644 |
Farmer Mac class A stock | 56 | 61 |
Fair Value | 23,123 | 22,194 |
Securities held to maturity, Amortized Cost [Abstract] | ||
Due in one year or less | 0 | 0 |
After one year through five years | 5,344 | 3,235 |
After five years through ten years | 2,587 | 5,212 |
After ten years | 0 | 0 |
Amortized Cost | 7,931 | 8,447 |
Securities held to maturity, Estimated Fair Value [Abstract] | ||
Due in one year or less | 0 | 0 |
After one year through five years | 5,697 | 3,479 |
After five years through ten years | 2,718 | 5,415 |
After ten years | 0 | 0 |
Fair Value | $8,415 | $8,894 |
INVESTMENT_SECURITIES_Unrealiz
INVESTMENT SECURITIES, Unrealized Loss Positions (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Thousands, unless otherwise specified | Security | Security |
Securities available-for-sale, continuous unrealized loss position [Abstract] | ||
Less Than Twelve Months, Gross Unrealized Losses | $63 | $28 |
Less Than Twelve Months, Fair Value | 5,404 | 1,979 |
More Than Twelve Months, Gross Unrealized Losses | 43 | 57 |
More Than Twelve Months, Fair Value | 3,895 | 8,061 |
Total, Gross Unrealized Losses | 106 | 85 |
Total, Fair Value | 9,299 | 10,040 |
Securities held-to-maturity, continuous unrealized loss position [Abstract] | ||
Less Than Twelve Months, Gross Unrealized Losses | 0 | 0 |
Less Than Twelve Months, Fair Value | 0 | 0 |
More Than Twelve Months, Gross Unrealized Losses | 0 | 0 |
More Than Twelve Months, Fair Value | 0 | 0 |
Total, Gross Unrealized Losses | 0 | 0 |
Total, Fair Value | 0 | 0 |
Securities in unrealized loss positions | 6 | 6 |
U.S. Government Agency [Member] | Mortgage Backed Securities ("MBS") [Member] | ||
Securities held-to-maturity, continuous unrealized loss position [Abstract] | ||
Less Than Twelve Months, Gross Unrealized Losses | 0 | 0 |
Less Than Twelve Months, Fair Value | 0 | 0 |
More Than Twelve Months, Gross Unrealized Losses | 0 | 0 |
More Than Twelve Months, Fair Value | 0 | 0 |
Total, Gross Unrealized Losses | 0 | 0 |
Total, Fair Value | 0 | 0 |
Equity Securities: Farmer Mac Class A Stock [Member] | ||
Securities available-for-sale, continuous unrealized loss position [Abstract] | ||
Less Than Twelve Months, Gross Unrealized Losses | 10 | 5 |
Less Than Twelve Months, Fair Value | 56 | 61 |
More Than Twelve Months, Gross Unrealized Losses | 0 | 0 |
More Than Twelve Months, Fair Value | 0 | 0 |
Total, Gross Unrealized Losses | 10 | 5 |
Total, Fair Value | 56 | 61 |
U.S. Government Agency [Member] | Notes [Member] | ||
Securities available-for-sale, continuous unrealized loss position [Abstract] | ||
Less Than Twelve Months, Gross Unrealized Losses | 53 | 23 |
Less Than Twelve Months, Fair Value | 5,348 | 1,918 |
More Than Twelve Months, Gross Unrealized Losses | 0 | 26 |
More Than Twelve Months, Fair Value | 0 | 3,971 |
Total, Gross Unrealized Losses | 53 | 49 |
Total, Fair Value | 5,348 | 5,889 |
U.S. Government Agency [Member] | Collateralized Mortgage Obligations ("CMO") [Member] | ||
Securities available-for-sale, continuous unrealized loss position [Abstract] | ||
Less Than Twelve Months, Gross Unrealized Losses | 0 | 0 |
Less Than Twelve Months, Fair Value | 0 | 0 |
More Than Twelve Months, Gross Unrealized Losses | 43 | 31 |
More Than Twelve Months, Fair Value | 3,895 | 4,090 |
Total, Gross Unrealized Losses | 43 | 31 |
Total, Fair Value | $3,895 | $4,090 |
LOAN_SALES_AND_SERVICING_SBA_a
LOAN SALES AND SERVICING, SBA and Agriculture Loans (Details) (USD $) | 3 Months Ended | ||
Mar. 31, 2015 | Mar. 31, 2014 | Dec. 31, 2014 | |
Servicing Assets at Fair Value [Line Items] | |||
Loans included in loans held for sale | $63,724,000 | $66,759,000 | |
SBA [Member] | |||
Servicing Assets at Fair Value [Line Items] | |||
Percentage as required principal balance of each loan, minimum (in hundredths) | 5.00% | ||
Percentage of loan amount unguaranteed to be periodically sold to third part for cash premium, minimum (in hundredths) | 5.00% | ||
Loans included in loans held for sale | 37,600,000 | 40,800,000 | |
Principal balance of loans serviced | 22,800,000 | 24,600,000 | |
US Department of Agriculture [Member] | |||
Servicing Assets at Fair Value [Line Items] | |||
Loans included in loans held for sale | 25,300,000 | 25,100,000 | |
Principal balance of loans serviced | 1,400,000 | 1,400,000 | |
Interest Only Strips [Member] | |||
Servicing assets accounted for under the fair value method [Roll Forward] | |||
Beginning balance | 293,000 | 334,000 | |
Adjustment to fair value | -7,000 | 0 | |
Ending balance | 286,000 | 334,000 | |
Servicing Rights [Member] | |||
Servicing assets accounted for under the fair value method [Roll Forward] | |||
Beginning balance | 203,000 | 300,000 | |
Adjustment to fair value | 6,000 | -38,000 | |
Ending balance | $209,000 | $262,000 |
LOAN_SALES_AND_SERVICING_Fair_
LOAN SALES AND SERVICING, Fair Value Assumptions Used (Details) | 3 Months Ended | |
Mar. 31, 2015 | Mar. 31, 2014 | |
Interest Only Strips [Member] | ||
Assumption for Fair Value as of Balance Sheet Date of Assets or Liabilities that relate to Transferor's Continuing Involvement [Line Items] | ||
Weighted-average constant prepayment rate (in hundredths) | 5.64% | 5.29% |
Weighted-average life | 6 years | 6 years |
Weighted-average discount rate (in hundredths) | 10.35% | 11.89% |
Servicing Rights [Member] | ||
Assumption for Fair Value as of Balance Sheet Date of Assets or Liabilities that relate to Transferor's Continuing Involvement [Line Items] | ||
Weighted-average constant prepayment rate (in hundredths) | 6.23% | 5.52% |
Weighted-average life | 8 years | 9 years |
Weighted-average discount rate (in hundredths) | 10.63% | 11.93% |
LOAN_SALES_AND_SERVICING_Sensi
LOAN SALES AND SERVICING, Sensitivity Analysis of Fair Value (Details) (USD $) | Mar. 31, 2015 | Mar. 31, 2014 |
In Thousands, unless otherwise specified | ||
Interest Only Strips [Member] | ||
Discount Rate [Abstract] | ||
Increase in fair value from 100 basis points decrease | $8 | $9 |
Decrease in fair value from 100 basis points increase | -8 | -9 |
Constant Prepayment Rate [Abstract] | ||
Increase in fair value from 10 percent decrease | 4 | 5 |
Decrease in fair value from 10 percent increase | -4 | -5 |
Servicing Rights [Member] | ||
Discount Rate [Abstract] | ||
Increase in fair value from 100 basis points decrease | 9 | 11 |
Decrease in fair value from 100 basis points increase | -9 | -10 |
Constant Prepayment Rate [Abstract] | ||
Increase in fair value from 10 percent decrease | 6 | 6 |
Decrease in fair value from 10 percent increase | ($5) | ($6) |
LOAN_SALES_AND_SERVICING_Servi
LOAN SALES AND SERVICING, Servicing Assets at Amortization Cost (Details) (Servicing Rights [Member], USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Servicing Rights [Member] | ||
Servicing rights accounted for under the amortization method [Roll Forward] | ||
Beginning balance | $167 | $268 |
Amortization | -8 | -28 |
Ending balance | $159 | $240 |
LOAN_SALES_AND_SERVICING_Mortg
LOAN SALES AND SERVICING, Mortgage Loans (Details) (USD $) | 3 Months Ended | |
In Millions, unless otherwise specified | Mar. 31, 2015 | Dec. 31, 2014 |
Commitment | ||
Mortgage Loan Sales [Abstract] | ||
Period for entity entered into mortgage loan rate lock commitments | 30 days | |
Number of commitments which create an economic hedge | 2 | |
Mortgage loan interest rate lock and forward sale commitments amount | $3.30 | $1.90 |
Mortgage loan held for sale | $0.70 | $0.80 |
LOANS_HELD_FOR_INVESTMENT_Deta
LOANS HELD FOR INVESTMENT (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Thousands, unless otherwise specified | ||
Loans held for investment [Abstract] | ||
Loan held for investment, gross | $429,706 | $428,729 |
Allowance for loan losses | 7,275 | 7,877 |
Deferred fees, net | 128 | 118 |
Discount on SBA loans | 226 | 237 |
Total loans held for investment, net | 422,077 | 420,497 |
Manufactured Housing [Member] | ||
Loans held for investment [Abstract] | ||
Loan held for investment, gross | 169,751 | 169,662 |
Commercial Real Estate [Member] | ||
Loans held for investment [Abstract] | ||
Loan held for investment, gross | 163,163 | 159,432 |
Commercial [Member] | ||
Loans held for investment [Abstract] | ||
Loan held for investment, gross | 48,598 | 49,683 |
SBA [Member] | ||
Loans held for investment [Abstract] | ||
Loan held for investment, gross | 20,302 | 21,336 |
HELOC [Member] | ||
Loans held for investment [Abstract] | ||
Loan held for investment, gross | 13,130 | 13,481 |
Single Family Real Estate [Member] | ||
Loans held for investment [Abstract] | ||
Loan held for investment, gross | 14,606 | 14,957 |
Consumer [Member] | ||
Loans held for investment [Abstract] | ||
Loan held for investment, gross | $156 | $178 |
LOANS_HELD_FOR_INVESTMENT_Fina
LOANS HELD FOR INVESTMENT, Financing Receivables Past Due (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Thousands, unless otherwise specified | ||
Aging of loans held for investment [Abstract] | ||
Current | $427,536 | $427,321 |
30-59 Days Past Due | 432 | 874 |
60-89 Days Past Due | 207 | 0 |
Over 90 Days Past Due | 1,531 | 534 |
Total Past Due | 2,170 | 1,408 |
Total loans held for investment | 429,706 | 428,729 |
Recorded Investment Over 90 Days and Accruing | 0 | 0 |
SBA Guaranteed Loans [Member] | ||
Aging of loans held for investment [Abstract] | ||
Total loans held for investment | 46,629 | 6,372 |
Manufactured Housing [Member] | ||
Aging of loans held for investment [Abstract] | ||
Current | 169,283 | 169,233 |
30-59 Days Past Due | 188 | 239 |
60-89 Days Past Due | 155 | 0 |
Over 90 Days Past Due | 125 | 190 |
Total Past Due | 468 | 429 |
Total loans held for investment | 169,751 | 169,662 |
Recorded Investment Over 90 Days and Accruing | 0 | 0 |
Commercial Real Estate [Member] | ||
Aging of loans held for investment [Abstract] | ||
Current | 119,206 | 119,090 |
30-59 Days Past Due | 0 | 632 |
60-89 Days Past Due | 0 | 0 |
Over 90 Days Past Due | 1,342 | 186 |
Total Past Due | 1,342 | 818 |
Total loans held for investment | 120,548 | 119,908 |
Recorded Investment Over 90 Days and Accruing | 0 | 0 |
SBA 504 1st Trust Deed [Member] | ||
Aging of loans held for investment [Abstract] | ||
Current | 28,596 | 27,297 |
30-59 Days Past Due | 0 | 0 |
60-89 Days Past Due | 0 | 0 |
Over 90 Days Past Due | 0 | 0 |
Total Past Due | 0 | 0 |
Total loans held for investment | 28,596 | 27,297 |
Recorded Investment Over 90 Days and Accruing | 0 | 0 |
Land [Member] | ||
Aging of loans held for investment [Abstract] | ||
Current | 1,561 | 1,569 |
30-59 Days Past Due | 0 | 0 |
60-89 Days Past Due | 0 | 0 |
Over 90 Days Past Due | 0 | 0 |
Total Past Due | 0 | 0 |
Total loans held for investment | 1,561 | 1,569 |
Recorded Investment Over 90 Days and Accruing | 0 | 0 |
Construction [Member] | ||
Aging of loans held for investment [Abstract] | ||
Current | 12,458 | 10,658 |
30-59 Days Past Due | 0 | 0 |
60-89 Days Past Due | 0 | 0 |
Over 90 Days Past Due | 0 | 0 |
Total Past Due | 0 | 0 |
Total loans held for investment | 12,458 | 10,658 |
Recorded Investment Over 90 Days and Accruing | 0 | 0 |
Commercial [Member] | ||
Aging of loans held for investment [Abstract] | ||
Current | 48,356 | 49,683 |
30-59 Days Past Due | 242 | 0 |
60-89 Days Past Due | 0 | 0 |
Over 90 Days Past Due | 0 | 0 |
Total Past Due | 242 | 0 |
Total loans held for investment | 48,598 | 49,683 |
Recorded Investment Over 90 Days and Accruing | 0 | 0 |
SBA [Member] | ||
Aging of loans held for investment [Abstract] | ||
Current | 20,248 | 21,333 |
30-59 Days Past Due | 2 | 3 |
60-89 Days Past Due | 52 | 0 |
Over 90 Days Past Due | 0 | 0 |
Total Past Due | 54 | 3 |
Total loans held for investment | 20,302 | 21,336 |
Recorded Investment Over 90 Days and Accruing | 0 | 0 |
HELOC [Member] | ||
Aging of loans held for investment [Abstract] | ||
Current | 13,066 | 13,459 |
30-59 Days Past Due | 0 | 0 |
60-89 Days Past Due | 0 | 0 |
Over 90 Days Past Due | 64 | 22 |
Total Past Due | 64 | 22 |
Total loans held for investment | 13,130 | 13,481 |
Recorded Investment Over 90 Days and Accruing | 0 | 0 |
Single Family Real Estate [Member] | ||
Aging of loans held for investment [Abstract] | ||
Current | 14,606 | 14,821 |
30-59 Days Past Due | 0 | 0 |
60-89 Days Past Due | 0 | |
Over 90 Days Past Due | 0 | 136 |
Total Past Due | 0 | 136 |
Total loans held for investment | 14,606 | 14,957 |
Recorded Investment Over 90 Days and Accruing | 0 | 0 |
Consumer [Member] | ||
Aging of loans held for investment [Abstract] | ||
Current | 156 | 178 |
30-59 Days Past Due | 0 | 0 |
60-89 Days Past Due | 0 | 0 |
Over 90 Days Past Due | 0 | 0 |
Total Past Due | 0 | 0 |
Total loans held for investment | 156 | 178 |
Recorded Investment Over 90 Days and Accruing | $0 | $0 |
LOANS_HELD_FOR_INVESTMENT_Allo
LOANS HELD FOR INVESTMENT, Allowance for Credit Losses by Portfolio Type (Details) (USD $) | 3 Months Ended | ||
Mar. 31, 2015 | Mar. 31, 2014 | Dec. 31, 2014 | |
Summary of provision, charge-offs and recoveries by loan category [Abstract] | |||
Beginning balance | $7,877,000 | $12,208,000 | |
Charge-offs | -131,000 | -252,000 | |
Recoveries | 497,000 | 771,000 | |
Net (charge-offs) | 366,000 | 519,000 | |
Provision | -968,000 | -1,371,000 | |
Ending balance | 7,275,000 | 11,356,000 | |
Reserve for credit losses on undisbursed loans | 37,000 | 39,000 | |
Manufactured Housing [Member] | |||
Summary of provision, charge-offs and recoveries by loan category [Abstract] | |||
Beginning balance | 4,032,000 | 5,114,000 | |
Charge-offs | -131,000 | -240,000 | |
Recoveries | 49,000 | 36,000 | |
Net (charge-offs) | -82,000 | -204,000 | |
Provision | 88,000 | -30,000 | |
Ending balance | 4,038,000 | 4,880,000 | |
Commercial Real Estate [Member] | |||
Summary of provision, charge-offs and recoveries by loan category [Abstract] | |||
Beginning balance | 1,459,000 | 2,552,000 | |
Charge-offs | 0 | 0 | |
Recoveries | 13,000 | 639,000 | |
Net (charge-offs) | 13,000 | 639,000 | |
Provision | 105,000 | -907,000 | |
Ending balance | 1,577,000 | 2,284,000 | |
Commercial [Member] | |||
Summary of provision, charge-offs and recoveries by loan category [Abstract] | |||
Beginning balance | 986,000 | 2,064,000 | |
Charge-offs | 0 | 0 | |
Recoveries | 321,000 | 29,000 | |
Net (charge-offs) | 321,000 | 29,000 | |
Provision | -707,000 | -265,000 | |
Ending balance | 600,000 | 1,828,000 | |
SBA [Member] | |||
Summary of provision, charge-offs and recoveries by loan category [Abstract] | |||
Beginning balance | 1,066,000 | 1,951,000 | |
Charge-offs | 0 | -12,000 | |
Recoveries | 110,000 | 51,000 | |
Net (charge-offs) | 110,000 | 39,000 | |
Provision | -298,000 | -132,000 | |
Ending balance | 878,000 | 1,858,000 | |
HELOC [Member] | |||
Summary of provision, charge-offs and recoveries by loan category [Abstract] | |||
Beginning balance | 140,000 | 280,000 | |
Charge-offs | 0 | 0 | |
Recoveries | 3,000 | 15,000 | |
Net (charge-offs) | 3,000 | 15,000 | |
Provision | -90,000 | -30,000 | |
Ending balance | 53,000 | 265,000 | |
Single Family Real Estate [Member] | |||
Summary of provision, charge-offs and recoveries by loan category [Abstract] | |||
Beginning balance | 192,000 | 245,000 | |
Charge-offs | 0 | 0 | |
Recoveries | 1,000 | 1,000 | |
Net (charge-offs) | 1,000 | 1,000 | |
Provision | -68,000 | -7,000 | |
Ending balance | 125,000 | 239,000 | |
Consumer [Member] | |||
Summary of provision, charge-offs and recoveries by loan category [Abstract] | |||
Beginning balance | 2,000 | 2,000 | |
Charge-offs | 0 | 0 | |
Recoveries | 0 | 0 | |
Net (charge-offs) | 0 | 0 | |
Provision | 2,000 | 0 | |
Ending balance | $4,000 | $2,000 |
LOANS_HELD_FOR_INVESTMENT_Impa
LOANS HELD FOR INVESTMENT, Impaired Financing Receivables (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||||
Recorded Investment [Abstract] | ||||
Impaired loans with an allowance recorded | $9,300 | $13,136 | ||
Impaired loans with no allowance recorded | 6,562 | 3,703 | ||
Total loans individually evaluated for impairment | 15,862 | 16,839 | ||
Loans collectively evaluated for impairment | 413,844 | 411,890 | ||
Total loans held for investment | 429,706 | 428,729 | ||
Unpaid Principal Balance [Abstract] | ||||
Impaired loans with an allowance recorded | 16,372 | 23,312 | ||
Impaired loans with no allowance recorded | 12,232 | 7,604 | ||
Total loans individually evaluated for impairment | 28,604 | 30,916 | ||
Loans collectively evaluated for impairment | 413,844 | 411,890 | ||
Total loans held for investment | 442,448 | 442,806 | ||
Related Allowance for Credit Losses [Abstract] | ||||
Impaired loans with an allowance recorded | 686 | 854 | ||
Impaired loans with no allowance recorded | 0 | 0 | ||
Total loans individually evaluated for impairment | 686 | 854 | ||
Loans collectively evaluated for impairment | 6,589 | 7,023 | ||
Total loans held for investment | 7,275 | 7,877 | 11,356 | 12,208 |
Impaired loans with a specific valuation allowance under ASC 310 | 9,300 | 13,136 | ||
Impaired loans without a specific valuation allowance under ASC 310 | 6,562 | 3,703 | ||
Impaired loans | 15,862 | 16,839 | ||
Valuation allowance related to impaired loans | 686 | 854 | ||
Manufactured Housing [Member] | ||||
Recorded Investment [Abstract] | ||||
Impaired loans with an allowance recorded | 3,237 | 4,717 | ||
Impaired loans with no allowance recorded | 4,033 | 2,734 | ||
Total loans individually evaluated for impairment | 7,270 | 7,451 | ||
Loans collectively evaluated for impairment | 162,481 | 162,211 | ||
Total loans held for investment | 169,751 | 169,662 | ||
Unpaid Principal Balance [Abstract] | ||||
Impaired loans with an allowance recorded | 3,278 | 5,172 | ||
Impaired loans with no allowance recorded | 5,900 | 4,243 | ||
Total loans individually evaluated for impairment | 9,178 | 9,415 | ||
Loans collectively evaluated for impairment | 162,481 | 162,211 | ||
Total loans held for investment | 171,659 | 171,626 | ||
Related Allowance for Credit Losses [Abstract] | ||||
Impaired loans with an allowance recorded | 428 | 399 | ||
Impaired loans with no allowance recorded | 0 | 0 | ||
Total loans individually evaluated for impairment | 428 | 399 | ||
Loans collectively evaluated for impairment | 3,610 | 3,633 | ||
Total loans held for investment | 4,038 | 4,032 | 4,880 | 5,114 |
Impaired loans with a specific valuation allowance under ASC 310 | 3,237 | 4,717 | ||
Impaired loans without a specific valuation allowance under ASC 310 | 4,033 | 2,734 | ||
Impaired loans | 7,270 | 7,451 | ||
Commercial Real Estate [Member] | ||||
Recorded Investment [Abstract] | ||||
Impaired loans with an allowance recorded | 1,443 | 2,783 | ||
Impaired loans with no allowance recorded | 1,813 | 831 | ||
Total loans individually evaluated for impairment | 3,256 | 3,614 | ||
Loans collectively evaluated for impairment | 159,907 | 155,818 | ||
Total loans held for investment | 163,163 | 159,432 | ||
Unpaid Principal Balance [Abstract] | ||||
Impaired loans with an allowance recorded | 1,622 | 2,979 | ||
Impaired loans with no allowance recorded | 3,923 | 2,895 | ||
Total loans individually evaluated for impairment | 5,545 | 5,874 | ||
Loans collectively evaluated for impairment | 159,907 | 155,818 | ||
Total loans held for investment | 165,452 | 161,692 | ||
Related Allowance for Credit Losses [Abstract] | ||||
Impaired loans with an allowance recorded | 15 | 77 | ||
Impaired loans with no allowance recorded | 0 | 0 | ||
Total loans individually evaluated for impairment | 15 | 77 | ||
Loans collectively evaluated for impairment | 1,562 | 1,382 | ||
Total loans held for investment | 1,577 | 1,459 | 2,284 | 2,552 |
Impaired loans with a specific valuation allowance under ASC 310 | 1,443 | 2,783 | ||
Impaired loans without a specific valuation allowance under ASC 310 | 1,813 | 831 | ||
Impaired loans | 2,262 | 2,320 | ||
Commercial [Member] | ||||
Recorded Investment [Abstract] | ||||
Impaired loans with an allowance recorded | 2,854 | 3,122 | ||
Impaired loans with no allowance recorded | 44 | 44 | ||
Total loans individually evaluated for impairment | 2,898 | 3,166 | ||
Loans collectively evaluated for impairment | 45,700 | 46,517 | ||
Total loans held for investment | 48,598 | 49,683 | ||
Unpaid Principal Balance [Abstract] | ||||
Impaired loans with an allowance recorded | 3,543 | 4,914 | ||
Impaired loans with no allowance recorded | 50 | 50 | ||
Total loans individually evaluated for impairment | 3,593 | 4,964 | ||
Loans collectively evaluated for impairment | 45,700 | 46,517 | ||
Total loans held for investment | 49,293 | 51,481 | ||
Related Allowance for Credit Losses [Abstract] | ||||
Impaired loans with an allowance recorded | 50 | 241 | ||
Impaired loans with no allowance recorded | 0 | 0 | ||
Total loans individually evaluated for impairment | 50 | 241 | ||
Loans collectively evaluated for impairment | 550 | 745 | ||
Total loans held for investment | 600 | 986 | 1,828 | 2,064 |
Impaired loans with a specific valuation allowance under ASC 310 | 2,854 | 3,122 | ||
Impaired loans without a specific valuation allowance under ASC 310 | 44 | 44 | ||
Impaired loans | 2,898 | 3,166 | ||
SBA [Member] | ||||
Recorded Investment [Abstract] | ||||
Impaired loans with an allowance recorded | 1,674 | 1,837 | ||
Impaired loans with no allowance recorded | 149 | 4 | ||
Total loans individually evaluated for impairment | 1,823 | 1,841 | ||
Loans collectively evaluated for impairment | 18,479 | 19,495 | ||
Total loans held for investment | 20,302 | 21,336 | ||
Unpaid Principal Balance [Abstract] | ||||
Impaired loans with an allowance recorded | 7,837 | 9,512 | ||
Impaired loans with no allowance recorded | 1,678 | 225 | ||
Total loans individually evaluated for impairment | 9,515 | 9,737 | ||
Loans collectively evaluated for impairment | 18,479 | 19,495 | ||
Total loans held for investment | 27,994 | 29,232 | ||
Related Allowance for Credit Losses [Abstract] | ||||
Impaired loans with an allowance recorded | 183 | 104 | ||
Impaired loans with no allowance recorded | 0 | 0 | ||
Total loans individually evaluated for impairment | 183 | 104 | ||
Loans collectively evaluated for impairment | 695 | 962 | ||
Total loans held for investment | 878 | 1,066 | 1,858 | 1,951 |
Impaired loans with a specific valuation allowance under ASC 310 | 1,674 | 1,837 | ||
Impaired loans without a specific valuation allowance under ASC 310 | 149 | 4 | ||
Impaired loans | 1,823 | 1,841 | ||
HELOC [Member] | ||||
Recorded Investment [Abstract] | ||||
Impaired loans with an allowance recorded | 21 | 86 | ||
Impaired loans with no allowance recorded | 63 | 0 | ||
Total loans individually evaluated for impairment | 84 | 86 | ||
Loans collectively evaluated for impairment | 13,046 | 13,395 | ||
Total loans held for investment | 13,130 | 13,481 | ||
Unpaid Principal Balance [Abstract] | ||||
Impaired loans with an allowance recorded | 21 | 91 | ||
Impaired loans with no allowance recorded | 69 | 0 | ||
Total loans individually evaluated for impairment | 90 | 91 | ||
Loans collectively evaluated for impairment | 13,046 | 13,395 | ||
Total loans held for investment | 13,136 | 13,486 | ||
Related Allowance for Credit Losses [Abstract] | ||||
Impaired loans with an allowance recorded | 0 | 1 | ||
Impaired loans with no allowance recorded | 0 | 0 | ||
Total loans individually evaluated for impairment | 0 | 1 | ||
Loans collectively evaluated for impairment | 53 | 139 | ||
Total loans held for investment | 53 | 140 | 265 | 280 |
Impaired loans with a specific valuation allowance under ASC 310 | 21 | 86 | ||
Impaired loans without a specific valuation allowance under ASC 310 | 63 | 0 | ||
Impaired loans | 84 | 86 | ||
Single Family Real Estate [Member] | ||||
Recorded Investment [Abstract] | ||||
Impaired loans with an allowance recorded | 71 | 591 | ||
Impaired loans with no allowance recorded | 460 | 90 | ||
Total loans individually evaluated for impairment | 531 | 681 | ||
Loans collectively evaluated for impairment | 14,075 | 14,276 | ||
Total loans held for investment | 14,606 | 14,957 | ||
Unpaid Principal Balance [Abstract] | ||||
Impaired loans with an allowance recorded | 71 | 644 | ||
Impaired loans with no allowance recorded | 612 | 191 | ||
Total loans individually evaluated for impairment | 683 | 835 | ||
Loans collectively evaluated for impairment | 14,075 | 14,276 | ||
Total loans held for investment | 14,758 | 15,111 | ||
Related Allowance for Credit Losses [Abstract] | ||||
Impaired loans with an allowance recorded | 10 | 32 | ||
Impaired loans with no allowance recorded | 0 | 0 | ||
Total loans individually evaluated for impairment | 10 | 32 | ||
Loans collectively evaluated for impairment | 115 | 160 | ||
Total loans held for investment | 125 | 192 | 239 | 245 |
Impaired loans with a specific valuation allowance under ASC 310 | 71 | 591 | ||
Impaired loans without a specific valuation allowance under ASC 310 | 460 | 90 | ||
Impaired loans | 531 | 681 | ||
Consumer [Member] | ||||
Recorded Investment [Abstract] | ||||
Impaired loans with an allowance recorded | 0 | 0 | ||
Impaired loans with no allowance recorded | 0 | 0 | ||
Total loans individually evaluated for impairment | 0 | 0 | ||
Loans collectively evaluated for impairment | 156 | 178 | ||
Total loans held for investment | 156 | 178 | ||
Unpaid Principal Balance [Abstract] | ||||
Impaired loans with an allowance recorded | 0 | 0 | ||
Impaired loans with no allowance recorded | 0 | 0 | ||
Total loans individually evaluated for impairment | 0 | 0 | ||
Loans collectively evaluated for impairment | 156 | 178 | ||
Total loans held for investment | 156 | 178 | ||
Related Allowance for Credit Losses [Abstract] | ||||
Impaired loans with an allowance recorded | 0 | |||
Impaired loans with no allowance recorded | 0 | 0 | ||
Total loans individually evaluated for impairment | 0 | 0 | ||
Loans collectively evaluated for impairment | 4 | 2 | ||
Total loans held for investment | 4 | 2 | 2 | 2 |
Impaired loans with a specific valuation allowance under ASC 310 | 0 | 0 | ||
Impaired loans without a specific valuation allowance under ASC 310 | $0 | $0 |
LOANS_HELD_FOR_INVESTMENT_Impa1
LOANS HELD FOR INVESTMENT, Impaired Loans by Class of Loans (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Thousands, unless otherwise specified | ||
Impaired financing receivable recorded investment net [Abstract] | ||
Impaired loans | $15,862 | $16,839 |
Manufactured Housing [Member] | ||
Impaired financing receivable recorded investment net [Abstract] | ||
Impaired loans | 7,270 | 7,451 |
Commercial Real Estate [Member] | ||
Impaired financing receivable recorded investment net [Abstract] | ||
Impaired loans | 2,262 | 2,320 |
SBA 504 1st Trust Deed [Member] | ||
Impaired financing receivable recorded investment net [Abstract] | ||
Impaired loans | 994 | 1,294 |
Commercial [Member] | ||
Impaired financing receivable recorded investment net [Abstract] | ||
Impaired loans | 2,898 | 3,166 |
SBA [Member] | ||
Impaired financing receivable recorded investment net [Abstract] | ||
Impaired loans | 1,823 | 1,841 |
HELOC [Member] | ||
Impaired financing receivable recorded investment net [Abstract] | ||
Impaired loans | 84 | 86 |
Single Family Real Estate [Member] | ||
Impaired financing receivable recorded investment net [Abstract] | ||
Impaired loans | $531 | $681 |
LOANS_HELD_FOR_INVESTMENT_Aver
LOANS HELD FOR INVESTMENT, Average Investment in Impaired Loans by Class (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Average recorded investment and interest income recognized [Abstract] | ||
Average Investment in Impaired Loans | $16,192 | $19,267 |
Interest Income | 136 | 87 |
Manufactured Housing [Member] | ||
Average recorded investment and interest income recognized [Abstract] | ||
Average Investment in Impaired Loans | 7,288 | 8,862 |
Interest Income | 115 | 59 |
Commercial Real Estate [Member] | ||
Average recorded investment and interest income recognized [Abstract] | ||
Average Investment in Impaired Loans | 2,269 | 2,728 |
Interest Income | 0 | 0 |
SBA 504 1st Trust Deed [Member] | ||
Average recorded investment and interest income recognized [Abstract] | ||
Average Investment in Impaired Loans | 1,133 | 678 |
Interest Income | 9 | 5 |
Land [Member] | ||
Average recorded investment and interest income recognized [Abstract] | ||
Average Investment in Impaired Loans | 0 | 140 |
Interest Income | 0 | 0 |
Commercial [Member] | ||
Average recorded investment and interest income recognized [Abstract] | ||
Average Investment in Impaired Loans | 3,003 | 3,662 |
Interest Income | 0 | 14 |
SBA [Member] | ||
Average recorded investment and interest income recognized [Abstract] | ||
Average Investment in Impaired Loans | 1,814 | 1,771 |
Interest Income | 11 | 3 |
HELOC [Member] | ||
Average recorded investment and interest income recognized [Abstract] | ||
Average Investment in Impaired Loans | 85 | 597 |
Interest Income | 0 | 5 |
Single Family Real Estate [Member] | ||
Average recorded investment and interest income recognized [Abstract] | ||
Average Investment in Impaired Loans | 600 | 740 |
Interest Income | 1 | 1 |
Consumer [Member] | ||
Average recorded investment and interest income recognized [Abstract] | ||
Average Investment in Impaired Loans | 0 | 0 |
Interest Income | $0 | $0 |
LOANS_HELD_FOR_INVESTMENT_Reco
LOANS HELD FOR INVESTMENT, Recorded Investment in Certain Types of Loans (Details) (USD $) | 3 Months Ended | ||
Mar. 31, 2015 | Mar. 31, 2014 | Dec. 31, 2014 | |
Financing receivable recorded investment [Abstract] | |||
Nonaccrual loans | $16,048,000 | $17,883,000 | |
SBA guaranteed portion of loans included above | -5,566,000 | -6,856,000 | |
Total nonaccrual loans, net | 10,482,000 | 11,027,000 | |
Troubled debt restructured loans, gross | 9,462,000 | 9,685,000 | |
Loans 30 through 89 days past due with interest accruing | 513,000 | 0 | |
Allowance for loan losses to gross loans held for investment (in hundredths) | 1.69% | 1.84% | |
Number of days a loan is past due after which accrual of interest is discontinued | 90 days | ||
Foregone interest on nonaccrual and troubled debt restructured loans | $300,000 | $400,000 |
LOANS_HELD_FOR_INVESTMENT_Nona
LOANS HELD FOR INVESTMENT, Nonaccrual Loans, Net of SBA Guarantee (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2015 | Dec. 31, 2014 |
Composition of Nonaccrual Loans, net of SBA guarantee [Abstract] | ||
Nonaccrual loans, net | $10,482 | $11,027 |
Number of days a loan is past due after which guaranteed portion of SBA loan is repurchased from investors | 120 days | |
Manufactured Housing [Member] | ||
Composition of Nonaccrual Loans, net of SBA guarantee [Abstract] | ||
Nonaccrual loans, net | 1,735 | 1,480 |
Commercial Real Estate [Member] | ||
Composition of Nonaccrual Loans, net of SBA guarantee [Abstract] | ||
Nonaccrual loans, net | 2,887 | 2,951 |
SBA 504 1st Trust Deed [Member] | ||
Composition of Nonaccrual Loans, net of SBA guarantee [Abstract] | ||
Nonaccrual loans, net | 724 | 1,021 |
Commercial [Member] | ||
Composition of Nonaccrual Loans, net of SBA guarantee [Abstract] | ||
Nonaccrual loans, net | 2,898 | 3,167 |
SBA [Member] | ||
Composition of Nonaccrual Loans, net of SBA guarantee [Abstract] | ||
Nonaccrual loans, net | 1,693 | 1,713 |
HELOC [Member] | ||
Composition of Nonaccrual Loans, net of SBA guarantee [Abstract] | ||
Nonaccrual loans, net | 85 | 86 |
Single Family Real Estate [Member] | ||
Composition of Nonaccrual Loans, net of SBA guarantee [Abstract] | ||
Nonaccrual loans, net | $460 | $609 |
LOANS_HELD_FOR_INVESTMENT_Cred
LOANS HELD FOR INVESTMENT, Credit Quality Indicators (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Thousands, unless otherwise specified | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment, net | $423,477 | $422,357 |
Total loans held for investment | 429,706 | 428,729 |
Pass [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment, net | 393,108 | 391,061 |
Total loans held for investment | 393,108 | 391,061 |
Special Mention [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment, net | 9,330 | 7,960 |
Total loans held for investment | 9,330 | 7,960 |
Substandard [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment, net | 20,948 | 23,239 |
Total loans held for investment | 27,177 | 29,611 |
Doubtful [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment, net | 91 | 97 |
Total loans held for investment | 91 | 97 |
SBA Guaranteed Loans [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 46,629 | 6,372 |
SBA Guaranteed Loans [Member] | Pass [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 0 | 0 |
SBA Guaranteed Loans [Member] | Special Mention [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 0 | 0 |
SBA Guaranteed Loans [Member] | Substandard [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 6,229 | 6,372 |
SBA Guaranteed Loans [Member] | Doubtful [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 0 | 0 |
Manufactured Housing [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 169,751 | 169,662 |
Manufactured Housing [Member] | Pass [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 164,852 | 162,638 |
Manufactured Housing [Member] | Special Mention [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 0 | 0 |
Manufactured Housing [Member] | Substandard [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 4,899 | 7,024 |
Manufactured Housing [Member] | Doubtful [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 0 | 0 |
Commercial Real Estate [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 120,548 | 119,908 |
Commercial Real Estate [Member] | Pass [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 107,265 | 106,909 |
Commercial Real Estate [Member] | Special Mention [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 6,918 | 6,544 |
Commercial Real Estate [Member] | Substandard [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 6,365 | 6,455 |
Commercial Real Estate [Member] | Doubtful [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 0 | 0 |
SBA 504 1st Trust Deed [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 28,596 | 27,297 |
SBA 504 1st Trust Deed [Member] | Pass [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 23,531 | 23,038 |
SBA 504 1st Trust Deed [Member] | Special Mention [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 1,744 | 1,085 |
SBA 504 1st Trust Deed [Member] | Substandard [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 3,321 | 3,174 |
SBA 504 1st Trust Deed [Member] | Doubtful [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 0 | 0 |
Land [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 1,561 | 1,569 |
Land [Member] | Pass [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 1,561 | 1,569 |
Land [Member] | Special Mention [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 0 | 0 |
Land [Member] | Substandard [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 0 | 0 |
Land [Member] | Doubtful [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 0 | 0 |
Construction [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 12,458 | 10,658 |
Construction [Member] | Pass [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 12,458 | 10,658 |
Construction [Member] | Special Mention [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 0 | 0 |
Construction [Member] | Substandard [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 0 | 0 |
Construction [Member] | Doubtful [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 0 | 0 |
Commercial [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 48,598 | 49,683 |
Commercial [Member] | Pass [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 45,199 | 46,275 |
Commercial [Member] | Special Mention [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 398 | 158 |
Commercial [Member] | Substandard [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 3,001 | 3,250 |
Commercial [Member] | Doubtful [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 0 | 0 |
SBA [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 20,302 | 21,336 |
SBA [Member] | Non-guaranteed [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 14,073 | 14,964 |
SBA [Member] | Non-guaranteed [Member] | Pass [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 11,837 | 12,803 |
SBA [Member] | Non-guaranteed [Member] | Special Mention [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 270 | 173 |
SBA [Member] | Non-guaranteed [Member] | Substandard [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 1,875 | 1,891 |
SBA [Member] | Non-guaranteed [Member] | Doubtful [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 91 | 97 |
HELOC [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 13,130 | 13,481 |
HELOC [Member] | Pass [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 12,288 | 12,888 |
HELOC [Member] | Special Mention [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 0 | 0 |
HELOC [Member] | Substandard [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 842 | 593 |
HELOC [Member] | Doubtful [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 0 | 0 |
Single Family Real Estate [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 14,606 | 14,957 |
Single Family Real Estate [Member] | Pass [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 13,961 | 14,105 |
Single Family Real Estate [Member] | Special Mention [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 0 | 0 |
Single Family Real Estate [Member] | Substandard [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 645 | 852 |
Single Family Real Estate [Member] | Doubtful [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 0 | 0 |
Consumer [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 156 | 178 |
Consumer [Member] | Pass [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 156 | 178 |
Consumer [Member] | Special Mention [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 0 | 0 |
Consumer [Member] | Substandard [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | 0 | 0 |
Consumer [Member] | Doubtful [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans held for investment | $0 | $0 |
LOANS_HELD_FOR_INVESTMENT_Trou
LOANS HELD FOR INVESTMENT, Troubled Debt Restructuring (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Loan | Loan | |
Payment | ||
Troubled debt restructurings (TDR) [Abstract] | ||
Number of Loans | 3 | 4 |
Pre-Modification Recorded Investment | $174 | $187 |
Post Modification Recorded Investment | 174 | 187 |
Balance of Loans with Rate Reduction | 0 | 187 |
Balance of Loans with Term Extension | 156 | 187 |
Effect on Allowance for Loan Losses | 4 | 5 |
Average rate concessions (in hundredths) | 0.00% | 0.63% |
Average Extension | 13 months | 180 months |
Number of consecutive nonpayments for a TDR loan to be deemed default | 2 | |
Manufactured Housing [Member] | ||
Troubled debt restructurings (TDR) [Abstract] | ||
Number of Loans | 3 | 4 |
Pre-Modification Recorded Investment | 174 | 187 |
Post Modification Recorded Investment | 174 | 187 |
Balance of Loans with Rate Reduction | 0 | 187 |
Balance of Loans with Term Extension | 156 | 187 |
Effect on Allowance for Loan Losses | $4 | $5 |
LOANS_HELD_FOR_INVESTMENT_Trou1
LOANS HELD FOR INVESTMENT, Troubled Debt Restructured Loans With Payment Defaults (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Loan | Loan | |
Troubled debt restructured loans with payment defaults [Abstract] | ||
Number of Loans | 0 | 1 |
Recorded Investment | $0 | $18 |
Effect on Allowance for Loan Loss | 0 | 5 |
Manufactured Housing [Member] | ||
Troubled debt restructured loans with payment defaults [Abstract] | ||
Number of Loans | 0 | 1 |
Recorded Investment | 0 | 18 |
Effect on Allowance for Loan Loss | $0 | $5 |
OTHER_ASSETS_ACQUIRED_THROUGH_2
OTHER ASSETS ACQUIRED THROUGH FORECLOSURE (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
OTHER ASSETS ACQUIRED THROUGH FORECLOSURE [Abstract] | ||
Balance, beginning of period | $137 | $3,811 |
Additions | 222 | 403 |
Proceeds from dispositions and receivables from participants | -40 | -393 |
Gains (losses) on sales, net | 1 | -40 |
Balance, ending of period | $320 | $3,781 |
FAIR_VALUE_MEASUREMENT_Details
FAIR VALUE MEASUREMENT (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Thousands, unless otherwise specified | ||
Assets [Abstract] | ||
Investment securities available-for-sale | $23,123 | $22,194 |
Recurring [Member] | ||
Assets [Abstract] | ||
Investment securities available-for-sale | 23,123 | 22,194 |
Interest only strips | 286 | 293 |
Servicing assets | 209 | 203 |
Total | 23,618 | 22,690 |
Recurring [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | ||
Assets [Abstract] | ||
Investment securities available-for-sale | 56 | 61 |
Interest only strips | 0 | 0 |
Servicing assets | 0 | 0 |
Total | 56 | 61 |
Recurring [Member] | Significant Other Observable Inputs (Level 2) [Member] | ||
Assets [Abstract] | ||
Investment securities available-for-sale | 23,067 | 22,133 |
Interest only strips | 0 | 0 |
Servicing assets | 0 | 0 |
Total | 23,067 | 22,133 |
Recurring [Member] | Significant Unobservable Inputs (Level 3) [Member] | ||
Assets [Abstract] | ||
Investment securities available-for-sale | 0 | 0 |
Interest only strips | 286 | 293 |
Servicing assets | 209 | 203 |
Total | $495 | $496 |
FAIR_VALUE_MEASUREMENT_Assets_
FAIR VALUE MEASUREMENT, Assets Measured on Non-recurring Basis (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||||
Summary of fair value measurements of assets measured on a non-recurring basis [Abstract] | ||||
Impaired loans | $15,862 | $16,839 | ||
Foreclosed real estate and repossessed assets | 320 | 137 | 3,781 | 3,811 |
Loans held-for-sale at carrying value | 63,724 | 66,759 | ||
Non-recurring [Member] | ||||
Summary of fair value measurements of assets measured on a non-recurring basis [Abstract] | ||||
Impaired loans | 4,227 | 5,580 | ||
Loans held for sale | 68,268 | 71,475 | ||
Foreclosed real estate and repossessed assets | 320 | 137 | ||
Total | 72,815 | 77,192 | ||
Non-recurring [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | ||||
Summary of fair value measurements of assets measured on a non-recurring basis [Abstract] | ||||
Impaired loans | 0 | 0 | ||
Loans held for sale | 0 | 0 | ||
Foreclosed real estate and repossessed assets | 0 | 0 | ||
Total | 0 | 0 | ||
Non-recurring [Member] | Significant Other Observable Inputs (Level 2) [Member] | ||||
Summary of fair value measurements of assets measured on a non-recurring basis [Abstract] | ||||
Impaired loans | 4,227 | 5,580 | ||
Loans held for sale | 68,268 | 71,475 | ||
Foreclosed real estate and repossessed assets | 320 | 137 | ||
Total | 72,815 | 77,192 | ||
Non-recurring [Member] | Significant Unobservable Inputs (Level 3) [Member] | ||||
Summary of fair value measurements of assets measured on a non-recurring basis [Abstract] | ||||
Impaired loans | 0 | 0 | ||
Loans held for sale | 0 | 0 | ||
Foreclosed real estate and repossessed assets | 0 | 0 | ||
Total | $0 | $0 |
FAIR_VALUE_MEASUREMENT_Fair_Va
FAIR VALUE MEASUREMENT, Fair Value of Financial Instruments (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Thousands, unless otherwise specified | ||
Level 1 [Member] | ||
Financial assets [Abstract] | ||
Cash and cash equivalents | $35,447 | $18,959 |
Interest-bearing deposits in other financial institutions | 99 | 99 |
FRB and FHLB stock | 0 | 0 |
Investment securities | 56 | 61 |
Loans, net | 0 | 0 |
Financial liabilities [Abstract] | ||
Deposits | 0 | 0 |
Other borrowings | 0 | 0 |
Level 2 [Member] | ||
Financial assets [Abstract] | ||
Cash and cash equivalents | 0 | 0 |
Interest-bearing deposits in other financial institutions | 0 | 0 |
FRB and FHLB stock | 3,089 | 3,089 |
Investment securities | 31,482 | 31,027 |
Loans, net | 489,191 | 490,193 |
Financial liabilities [Abstract] | ||
Deposits | 496,289 | 477,204 |
Other borrowings | 5,016 | 10,070 |
Level 3 [Member] | ||
Financial assets [Abstract] | ||
Cash and cash equivalents | 0 | 0 |
Interest-bearing deposits in other financial institutions | 0 | 0 |
FRB and FHLB stock | 0 | 0 |
Investment securities | 0 | 0 |
Loans, net | 10,949 | 10,405 |
Financial liabilities [Abstract] | ||
Deposits | 0 | 0 |
Other borrowings | 0 | 0 |
Carrying Amount [Member] | ||
Financial assets [Abstract] | ||
Cash and cash equivalents | 35,447 | 18,959 |
Interest-bearing deposits in other financial institutions | 99 | 99 |
FRB and FHLB stock | 3,089 | 3,089 |
Investment securities | 31,054 | 30,641 |
Loans, net | 485,801 | 487,256 |
Financial liabilities [Abstract] | ||
Deposits | 495,670 | 477,084 |
Other borrowings | 5,000 | 10,000 |
Fair Value [Member] | ||
Financial assets [Abstract] | ||
Cash and cash equivalents | 35,447 | 18,959 |
Interest-bearing deposits in other financial institutions | 99 | 99 |
FRB and FHLB stock | 3,089 | 3,089 |
Investment securities | 31,538 | 31,088 |
Loans, net | 500,140 | 500,598 |
Financial liabilities [Abstract] | ||
Deposits | 496,289 | 477,204 |
Other borrowings | $5,016 | $10,070 |
OTHER_BORROWINGS_AND_CONVERTIB1
OTHER BORROWINGS AND CONVERTIBLE DEBENTURES (Details) (USD $) | 3 Months Ended | ||
Mar. 31, 2015 | Mar. 31, 2014 | Dec. 31, 2014 | |
Federal Home Loan Bank Advances [Abstract] | |||
FHLB advances | $5,000,000 | $10,000,000 | |
FHLB advances borrowed weighted average rate (in hundredths) | 2.74% | 2.74% | |
Letter of credit with FHLB | 50,000,000 | ||
Securities pledged to FHLB with carrying value | 31,000,000 | 30,600,000 | |
Available for additional borrowing | 100,700,000 | 106,200,000 | |
Total FHLB interest expense | 600,000 | 200,000 | |
Securities Pledged as Collateral [Member] | |||
Federal Home Loan Bank Advances [Abstract] | |||
Securities pledged to FHLB with carrying value | 31,000,000 | 30,600,000 | |
Loan Pledge as Collateral [Member] | |||
Federal Home Loan Bank Advances [Abstract] | |||
Securities pledged to FHLB with carrying value | 81,200,000 | 67,300,000 | |
Federal Reserve Bank Advances [Member] | |||
Federal Reserve Bank [Abstract] | |||
Outstanding FRB advances | 0 | 0 | |
Borrowing capacity | $91,300,000 | $88,000,000 |
OTHER_BORROWINGS_AND_CONVERTIB2
OTHER BORROWINGS AND CONVERTIBLE DEBENTURES, Long and Short Term Debt (Details) (USD $) | 3 Months Ended | ||
Mar. 31, 2015 | Mar. 31, 2014 | Dec. 31, 2014 | |
Debt Instrument [Line Items] | |||
Principle converted to equity | $0 | $1,408,000 | |
Federal Funds Purchased [Member] | |||
Line of Credit Borrowing Capacity [Abstract] | |||
Federal funds borrowing lines at correspondent banks | 30,000,000 | ||
Federal funds amount outstanding | 0 | 0 | |
Convertible Subordinated Debentures [Member] | |||
Debt Instrument [Line Items] | |||
Principle converted to equity | 1,400,000 | ||
Debentures converted to shares of common stock (in shares) | 317,550 | ||
Debentures converted in cash | $34,000 |
STOCKHOLDERS_EQUITY_Details
STOCKHOLDERS' EQUITY (Details) (USD $) | 0 Months Ended | 3 Months Ended | 12 Months Ended | |
Jun. 04, 2013 | Mar. 31, 2015 | Mar. 31, 2014 | Dec. 31, 2014 | |
Director | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Beginning Balance | $31,000 | |||
Net other comprehensive income | -14,000 | 95,000 | ||
Ending Balance | 17,000 | |||
Dividends declared | 140,000 | |||
Discount on partial redemption of preferred stock | 19,000 | 0 | ||
Common stock dividend paid | 164,000 | 0 | ||
Series A Preferred Stock [Member] | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Preferred stock dividend rate for first five years (in hundredths) | 5.00% | |||
Preferred stock dividend rate after first five years (in hundredths) | 9.00% | |||
Number of members of the Board of Directors who purchased stock from private investors | 4 | |||
Number of shares purchased by directors (in shares) | 1,100 | |||
Dividends declared | 100,000 | 300,000 | ||
Preferred stock redemption amount (in hundredths) | 55.00% | |||
Number of preferred stock redemption (in shares) | 8,586 | |||
Preferred stock, redemption amount | 1,000,000 | 8,400,000 | ||
Discount on partial redemption of preferred stock | 200,000 | |||
Common Stock [Member] | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Number of shares can be issued against warrants (in shares) | 521,158 | |||
Exercise price of warrants (in dollars per shares) | $4.49 | |||
Term of warrants | 10 years | |||
Issuance of common stock in conjunction with debenture conversions (in shares) | 316,872 | |||
Unrealized holding gains (losses) on AFS [Member] | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Beginning Balance | 31,000 | -274,000 | -274,000 | |
Other comprehensive income (loss) before reclassifications | -14,000 | 95,000 | ||
Amounts reclassified from accumulated other comprehensive income | 0 | 0 | ||
Net other comprehensive income | -14,000 | 95,000 | ||
Ending Balance | $17,000 | ($179,000) |
EARNINGS_PER_SHARE_Details
EARNINGS PER SHARE (Details) (USD $) | 3 Months Ended | |
In Thousands, except Per Share data, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Reconciliation of basic and diluted earnings per share [Abstract] | ||
Net income | $1,770 | $1,442 |
Less: dividends and accretion on preferred stock and discount on partial redemption | 121 | 273 |
Net income available to common stockholders | 1,649 | 1,169 |
Add: debenture interest expense and costs, net of income taxes | 0 | 103 |
Net income for diluted calculation of earnings per common share | $1,649 | $1,272 |
Weighted average number of common shares outstanding - basic (in shares) | 8,203 | 7,971 |
Weighted average number of common shares outstanding - diluted (in shares) | 8,501 | 8,534 |
Earnings per share [Abstract] | ||
Basic (in dollars per share) | $0.20 | $0.15 |
Diluted (in dollars per share) | $0.19 | $0.15 |
CAPITAL_REQUIREMENT_Details
CAPITAL REQUIREMENT (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
Compliance with Regulatory Capital Requirements under Banking Regulations [Line Items] | ||
CET1 capital (to risk weighted assets), required ratio (in hundredths) | 4.50% | |
CET1 capital (to risk weighted assets), required capital conservation buffer ratio (in hundredths) | 2.50% | |
Total Capital | $72,569,000 | |
Tier 1 Capital | 66,939,000 | |
Risk-Weighted Assets | 448,199,000 | |
Adjusted Average Assets | 564,630,000 | |
Total Risk-Based Capital Ratio (in hundredths) | 16.19% | |
Tier 1 Risk-Based Capital Ratio (in hundredths) | 14.94% | |
Tier 1 Leverage Ratio (in hundredths) | 11.86% | |
Well-capitalized ratios, Total Capital (in hundredths) | 10.00% | 10.00% |
Well capitalized ratios, Tier 1 Capital (in hundredths) | 8.00% | 6.00% |
Well capitalized ratios, Common Equity Tier 1 Capital (in hundredths) | 6.50% | |
Well capitalized ratios, Tier 1 Leverage Capital (in hundredths) | 5.00% | 5.00% |
Minimum capital ratios, Total Capital (in hundredths) | 8.00% | 8.00% |
Minimum capital ratios, Tier 1 Capital (in hundredths) | 6.00% | 4.00% |
Minimum capital ratios, Common Equity Tier 1 Capital (in hundredths) | 4.50% | |
Minimum capital ratios, Tier 1 Leverage Capital (in hundredths) | 4.00% | 4.00% |
Minimum [Member] | ||
Compliance with Regulatory Capital Requirements under Banking Regulations [Line Items] | ||
Consolidated asset requirement under the Small Bank Holding Policy Statement final ruling | 500,000,000 | |
Maximum [Member] | ||
Compliance with Regulatory Capital Requirements under Banking Regulations [Line Items] | ||
Consolidated asset requirement under the Small Bank Holding Policy Statement final ruling | 1,000,000,000 | |
CWB [Member] | ||
Compliance with Regulatory Capital Requirements under Banking Regulations [Line Items] | ||
Total Capital | 71,793,000 | 71,303,000 |
Tier 1 Capital | 66,082,000 | 65,673,000 |
Common Equity Tier 1 Capital | 66,082,000 | |
Risk-Weighted Assets | 455,301,000 | 448,118,000 |
Adjusted Average Assets | 563,866,000 | $564,331,000 |
Total Risk-Based Capital Ratio (in hundredths) | 15.77% | 15.91% |
Tier 1 Risk-Based Capital Ratio (in hundredths) | 14.51% | 14.66% |
Common Equity Tier 1 Ratio (in hundredths) | 14.51% | |
Tier 1 Leverage Ratio (in hundredths) | 11.72% | 11.64% |