Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2022 | Mar. 29, 2023 | Jun. 30, 2022 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Annual Report | true | ||
Document Transition Report | false | ||
Document Period End Date | Dec. 31, 2022 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Fiscal Year Focus | 2022 | ||
Document Fiscal Period Focus | FY | ||
Entity File Number | 000-23575 | ||
Entity Registrant Name | COMMUNITY WEST BANCSHARES | ||
Entity Central Index Key | 0001051343 | ||
Entity Incorporation, State or Country Code | CA | ||
Entity Tax Identification Number | 77-0446957 | ||
Entity Address, Address Line One | 445 Pine Avenue | ||
Entity Address, City or Town | Goleta | ||
Entity Address, State or Province | CA | ||
Entity Address, Postal Zip Code | 93117 | ||
City Area Code | 805 | ||
Local Phone Number | 692-5821 | ||
Title of 12(b) Security | Common Stock, No Par Value | ||
Trading Symbol | CWBC | ||
Security Exchange Name | NASDAQ | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 102,042,120 | ||
Entity Common Stock, Shares Outstanding | 8,835,143 | ||
Auditor Name | RSM US LLP | ||
Auditor Location | San Francisco, California | ||
Auditor Firm ID | 49 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Assets: | ||
Cash and due from banks | $ 1,379 | $ 1,621 |
Interest-earning demand deposits in other financial institutions | 63,311 | 206,754 |
Cash and cash equivalents | 64,690 | 208,375 |
Investment securities - available-for-sale, at fair value; amortized cost of $27,790 at December 31, 2022 and $19,588 at December 31, 2021 | 26,688 | 19,711 |
Investment securities - held-to-maturity, at amortized cost; fair value of $2,423 at December 31, 2022 and $2,974 at December 31, 2021 | 2,557 | 2,815 |
Investment securities - measured at fair value | 225 | 248 |
Federal Home Loan Bank and Federal Reserve Bank stock, at cost | 4,533 | 4,441 |
Loans held for sale, at lower of cost or fair value | 21,033 | 23,408 |
Loans held for investment | 934,309 | 868,675 |
Allowance for loan losses | (10,765) | (10,404) |
Total loans held for investment, net | 923,544 | 858,271 |
Other assets acquired through foreclosure, net | 2,250 | 2,518 |
Premises and equipment, net | 6,104 | 6,576 |
Other assets | 39,878 | 30,689 |
Total assets | 1,091,502 | 1,157,052 |
Deposits: | ||
Non-interest-bearing demand | 216,494 | 209,893 |
Interest-bearing demand | 428,173 | 537,508 |
Savings | 23,490 | 23,675 |
Certificates of deposit ($250,000 or more) | 6,693 | 17,612 |
Other certificates of deposit | 200,234 | 161,443 |
Total deposits | 875,084 | 950,131 |
Federal Home Loan Bank advances | 90,000 | 90,000 |
Other liabilities | 13,768 | 15,546 |
Total liabilities | 978,852 | 1,055,677 |
Stockholders' equity: | ||
Common stock - no par value, 60,000,000 shares authorized; 8,798,412 shares issued and outstanding at December 31, 2022 and 8,650,166 at December 31, 2021 | 45,694 | 44,431 |
Retained earnings | 67,727 | 56,852 |
Accumulated other comprehensive (loss) income | (771) | 92 |
Total stockholders' equity | 112,650 | 101,375 |
Total liabilities and stockholders' equity | $ 1,091,502 | $ 1,157,052 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Assets: | ||
Investment securities available-for-sale, amortized cost | $ 27,790 | $ 19,588 |
Investment securities held-to-maturity, fair value | $ 2,423 | $ 2,974 |
Stockholders' equity: | ||
Common stock, par value (in dollars per share) | $ 0 | $ 0 |
Common stock, shares authorized (in shares) | 60,000,000 | 60,000,000 |
Common stock, shares issued (in shares) | 8,798,412 | 8,650,166 |
Common stock, shares outstanding (in shares) | 8,798,412 | 8,650,166 |
CONSOLIDATED INCOME STATEMENTS
CONSOLIDATED INCOME STATEMENTS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Interest and dividend income: | |||
Loans, including fees | $ 46,657 | $ 45,123 | $ 42,948 |
Investment securities and other | 2,481 | 955 | 906 |
Total interest and dividend income | 49,138 | 46,078 | 43,854 |
Interest expense: | |||
Deposits | 2,511 | 2,835 | 5,483 |
Federal Home Loan Bank advances and other borrowings | 817 | 869 | 1,782 |
Total interest expense | 3,328 | 3,704 | 7,265 |
Net interest income | 45,810 | 42,374 | 36,589 |
Provision (credit) for loan losses | (195) | (181) | 1,223 |
Net interest income after provision (credit) for loan losses | 46,005 | 42,555 | 35,366 |
Non-interest income: | |||
Other loan fees | 1,161 | 1,349 | 1,546 |
Gains from loan sales, net | 257 | 475 | 920 |
Document processing fees | 422 | 512 | 513 |
Service charges | 438 | 302 | 354 |
Other income | 1,700 | 1,115 | 579 |
Total non-interest income | 3,978 | 3,753 | 3,912 |
Non-interest expenses: | |||
Salaries and employee benefits | 19,637 | 18,624 | 18,287 |
Occupancy, net | 4,180 | 3,254 | 3,036 |
Professional services | 2,923 | 1,645 | 1,801 |
Advertising and marketing | 921 | 734 | 673 |
Data processing | 1,265 | 1,215 | 1,055 |
Depreciation | 711 | 780 | 821 |
FDIC assessment | 577 | 485 | 565 |
Other expenses | 1,058 | 1,258 | 1,285 |
Total non-interest expenses | 31,272 | 27,995 | 27,523 |
Income before provision for income taxes | 18,711 | 18,313 | 11,755 |
Provision for income taxes | 5,262 | 5,212 | 3,510 |
Net income | $ 13,449 | $ 13,101 | $ 8,245 |
Earnings per share: | |||
Basic (in dollars per share) | $ 1.54 | $ 1.53 | $ 0.97 |
Diluted (in dollars per share) | $ 1.51 | $ 1.5 | $ 0.97 |
Weighted average number of common shares outstanding: | |||
Basic (in shares) | 8,722,481 | 8,567,839 | 8,472,709 |
Diluted (in shares) | 8,892,127 | 8,722,938 | 8,542,829 |
Dividends declared per common share (in dollars per share) | $ 0.295 | $ 0.27 | $ 0.195 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME [Abstract] | |||
Net income | $ 13,449 | $ 13,101 | $ 8,245 |
Other comprehensive (loss) income, net: | |||
Unrealized (loss) income on securities available-for-sale (AFS), net (tax effect of $362, ($24), ($47) for each respective period presented) | (863) | 57 | 113 |
Net other comprehensive (loss) income | (863) | 57 | 113 |
Comprehensive income | $ 12,586 | $ 13,158 | $ 8,358 |
CONSOLIDATED STATEMENTS OF CO_2
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Other comprehensive (loss) income, net: | |||
Unrealized (loss) income on securities-available-for-sale (AFS), net, tax effect | $ 362 | $ (24) | $ (47) |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) $ in Thousands | Preferred Stock [Member] | Common Stock [Member] | Accumulated Other Comprehensive Income (Loss) [Member] | Retained Earnings [Member] | Total |
Balance at Dec. 31, 2019 | $ 0 | $ 42,586 | $ (78) | $ 39,470 | $ 81,978 |
Balances (in shares) at Dec. 31, 2019 | 0 | 8,472,000 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net income | $ 0 | $ 0 | 0 | 8,245 | 8,245 |
Exercise of stock options | $ 0 | $ 4 | 0 | 0 | 4 |
Exercise of stock options (in shares) | 0 | 1,000 | |||
Stock based compensation | $ 0 | $ 319 | 0 | 0 | 319 |
Stock based compensation (in shares) | 0 | 0 | |||
Common stock repurchases | $ 0 | $ 0 | 0 | 0 | 0 |
Common stock repurchases (in shares) | 0 | 0 | |||
Dividends on common stock | $ 0 | $ 0 | 0 | (1,652) | (1,652) |
Dividends on common stock (in shares) | 0 | 0 | |||
Other comprehensive income (loss), net | $ 0 | $ 0 | 113 | 0 | 113 |
Balance at Dec. 31, 2020 | $ 0 | $ 42,909 | 35 | 46,063 | 89,007 |
Balances (in shares) at Dec. 31, 2020 | 0 | 8,473,000 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net income | $ 0 | $ 0 | 0 | 13,101 | 13,101 |
Exercise of stock options | $ 0 | $ 1,204 | 0 | 0 | 1,204 |
Exercise of stock options (in shares) | 0 | 177,000 | |||
Stock based compensation | $ 0 | $ 318 | 0 | 0 | 318 |
Stock based compensation (in shares) | 0 | 0 | |||
Common stock repurchases | $ 0 | $ 0 | 0 | 0 | 0 |
Common stock repurchases (in shares) | 0 | 0 | |||
Dividends on common stock | $ 0 | $ 0 | 0 | (2,312) | (2,312) |
Dividends on common stock (in shares) | 0 | 0 | |||
Other comprehensive income (loss), net | $ 0 | $ 0 | 57 | 0 | 57 |
Balance at Dec. 31, 2021 | $ 0 | $ 44,431 | 92 | 56,852 | $ 101,375 |
Balances (in shares) at Dec. 31, 2021 | 0 | 8,650,000 | 8,650,166 | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net income | $ 0 | $ 0 | 0 | 13,449 | $ 13,449 |
Exercise of stock options | $ 0 | $ 974 | 0 | 0 | 974 |
Exercise of stock options (in shares) | 0 | 110,000 | |||
Grant of restricted stock awards, net of forfeitures | $ 0 | $ 0 | 0 | 0 | 0 |
Grant of restricted stock awards, net of forfeitures (in shares) | 0 | 38,000 | |||
Stock based compensation | $ 0 | $ 289 | 0 | 0 | 289 |
Stock based compensation (in shares) | 0 | 0 | |||
Dividends on common stock | $ 0 | $ 0 | 0 | (2,574) | (2,574) |
Dividends on common stock (in shares) | 0 | 0 | |||
Other comprehensive income (loss), net | $ 0 | $ 0 | (863) | 0 | (863) |
Balance at Dec. 31, 2022 | $ 0 | $ 45,694 | $ (771) | $ 67,727 | $ 112,650 |
Balances (in shares) at Dec. 31, 2022 | 0 | 8,798,000 | 8,798,412 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Cash flows from operating activities: | |||
Net income | $ 13,449 | $ 13,101 | $ 8,245 |
Adjustments to reconcile net income to cash provided by operating activities: | |||
Provision (credit) for loan losses | (195) | (181) | 1,223 |
Depreciation | 711 | 780 | 821 |
Stock-based compensation | 289 | 318 | 319 |
Deferred income taxes | 250 | (505) | (959) |
Net (accretion) amortization of discounts and premiums for investment securities | (76) | 63 | 82 |
(Gains) losses on: | |||
Sale of repossessed assets, net | (116) | 0 | 0 |
Sale of loans, net | (257) | (475) | (920) |
Sale of assets, net | 0 | 4 | 18 |
Loans originated for sale | (22,069) | (41,077) | (55,186) |
Proceeds from sales of loans held for sale | 21,331 | 41,552 | 56,106 |
Proceeds from principal paydowns on loans held for sale | 3,370 | 7,346 | 9,897 |
Change in fair value of equity securities | 23 | (99) | 18 |
Changes in: | |||
Other assets | (9,196) | 439 | (2,805) |
Other liabilities | (1,778) | 1,093 | (401) |
Servicing assets, net | 120 | (139) | (615) |
Net cash provided by operating activities | 5,856 | 22,220 | 15,843 |
Cash flows from investing activities: | |||
Principal pay downs and maturities of available-for-sale securities | 32,236 | 3,894 | 5,069 |
Purchase of available-for-sale securities | (40,360) | (6,250) | (3,000) |
Principal pay downs and maturities of held-to-maturity securities | 255 | 1,743 | 1,511 |
Loan originations and principal collections, net | (65,078) | (41,596) | (91,763) |
Purchase of bank owned life insurance | 0 | 0 | (2,500) |
Purchase of restricted stock, net | (92) | 192 | (546) |
Purchase of premises and equipment, net | (239) | (206) | (338) |
Proceeds from sale of other assets acquired through foreclosure | 384 | 0 | 0 |
Net cash used in investing activities | (72,894) | (42,223) | (91,567) |
Cash flows from financing activities: | |||
Net (decrease) increase in deposits | (75,047) | 183,946 | 15,251 |
Proceeds from FHLB advances | 45,000 | 0 | 90,000 |
Repayment of FHLB advances | (45,000) | (15,000) | (50,000) |
Exercise of stock options | 974 | 1,204 | 4 |
Cash dividends paid on common stock | (2,574) | (2,312) | (1,652) |
Net cash (used in) provided by financing activities | (76,647) | 167,838 | 53,603 |
Net (decrease) increase in cash and cash equivalents | (143,685) | 147,835 | (22,121) |
Cash and cash equivalents at beginning of year | 208,375 | 60,540 | 82,661 |
Cash and cash equivalents at end of year | 64,690 | 208,375 | 60,540 |
Cash paid during the period for: | |||
Interest | 3,260 | 3,880 | 8,050 |
Income taxes | 4,957 | 5,802 | 2,350 |
Non-cash investing and financing activity: | |||
Transfers to other assets acquired through foreclosure, net | 0 | 136 | 106 |
Operating lease right-of-use asset | 0 | 0 | 487 |
Operating lease liability | $ 0 | $ 0 | $ 487 |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2022 | |
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 investment securities available for sale. 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. Concentrations of Lending Activities The Company’s lending activities are primarily driven by the customers served in the market areas where the Company has branch offices in the Central Coast of California. The Company monitors concentrations within selected categories such as geography and product. The Company makes manufactured housing, commercial, SBA, construction, commercial real estate, and consumer loans to customers through branch offices located in the Company’s primary markets. The Company’s business is concentrated in these areas and the loan portfolio includes significant credit exposure to the manufactured housing and commercial real estate markets of these areas. As of December 31, 2022 and 2021, manufactured housing loans comprised 33.1% and 33.3%, respectively, of total loans. As of December 31, 2022 and 2021, commercial real estate loans accounted for approximately 57.1% and 53.9% of total loans, respectively. Approximately 24.5% and 27.8% of these commercial real estate loans were owner occupied at December 31, 2022 and 2021, respectively. Substantially all of these loans are secured by first liens with an average loan to value ratios of 50.4% and 53.7% at December 31, 2022 and 2021, respectively. The Company was within established lending policy limits at December 31, 2022 and 2021 Reclassifications Certain amounts in the consolidated financial statements as of and for the years ended December 31, 2022 and 2021 have been reclassified to conform to the current presentation. The reclassifications have no effect on net income or stockholders’ equity as previously reported. Business Segments Reportable business segments are determined using the “management approach” and are intended to present reportable segments consistent with how the chief operating decision maker organizes segments within the company for making operating decisions and assessing performance. As of December 31, 2022, 2021 and 2020, the Company had only one reportable business segment. Cash and Cash Equivalents For purposes of reporting cash flows, cash and cash equivalents include cash on hand and amounts due from banks (including cash items in process of clearing). Cash flows from loans originated by the Company and deposits are reported net. The Company maintains amounts due from banks, which at times may exceed federally insured limits. The Company has not experienced any losses in such accounts. Cash Reserve Requirement Depository institutions are required by law to maintain reserves against their transaction deposits. The reserves must be held in cash or with the Federal Reserve Bank (“FRB”). The amount of the reserve varies by bank as the bank is permitted to meet this requirement by maintaining the specified amount as an average balance over a two-week period. The Federal Reserve reduced the reserve requirement ratio to zero percent across all deposit tiers as of March 26, 2020, to aid institutions impacted by COVID-19. Investment Securities Investment securities may be classified as held-to-maturity (“HTM”), available-for-sale (“AFS”), or trading. The appropriate classification is initially decided at the time of purchase. Securities classified as held-to-maturity are those debt securities the Company has both the intent and ability to hold to maturity regardless of changes in market conditions, liquidity needs, or general economic conditions. These securities are carried at amortized cost. The sale of a security within three months of its maturity date or after the majority of the principal outstanding has been collected is considered a maturity for purposes of classification and disclosure. Securities classified as AFS or trading are reported as an asset on the Consolidated Balance Sheets at their estimated fair value. As the fair value of AFS securities changes, the changes are reported net of income tax as an element of other comprehensive income (loss) (“OCI”), except for impaired securities. When AFS securities are sold, the unrealized gain or loss is reclassified from OCI to non-interest income. The changes in the fair values of trading securities are reported in non-interest income. Securities classified as AFS are debt securities the Company intends to hold for an indefinite period of time, but not necessarily to maturity. Any decision to sell a security classified as AFS would be based on various factors, including significant movements in interest rates, changes in the maturity mix of the Company’s assets and liabilities, liquidity needs, decline in credit quality, and regulatory capital considerations. Trading securities are carried at their estimated fair value. The changes in the fair value of trading securities are adjusted through non-interest income monthly. Interest income on securities is recognized based on the coupon rate and increased by accretion of discounts earned or decreased by the amortization of premiums paid over the contractual life of the security using the interest method. For mortgage-backed securities, estimates of prepayments are considered in the constant yield calculations. In estimating whether there are any other than temporary impairment losses, management considers 1) the length of time and the extent to which the fair value has been less than amortized cost, 2) the financial condition and near term prospects of the issuer, 3) the impact of changes in market interest rates, and 4) the intent and ability of the Company to retain its investment for a period of time sufficient to allow for any anticipated recovery in fair value and it is not more likely than not the Company would be required to sell the security. Declines in the fair value of individual debt securities available for sale that are deemed to be other than temporary are reflected in earnings when identified. The fair value of the debt security then becomes the new cost basis. For individual debt securities where the Company does not intend to sell the security and it is not more likely than not that the Company will be required to sell the security before recovery of its amortized cost basis, the other than temporary decline in fair value of the debt security related to 1) credit loss is recognized in earnings, and 2) market or other factors is recognized in other comprehensive income or loss. For individual debt securities where the Company intends to sell the security or more likely than not will not recover all of its amortized cost, the other than temporary impairment is recognized in earnings equal to the entire difference between the securities cost basis and its fair value at the balance sheet date. For individual debt securities for which a credit loss has been recognized in earnings, interest accruals and amortization and accretion of premiums and discounts are suspended when the credit loss is recognized. Interest received after accruals have been suspended is recognized on a cash basis. Federal Home Loan Bank (“FHLB”) and Federal Reserve Bank (“FRB”) Stock The Company’s subsidiary bank is a member of the FHLB system and maintains an investment in capital stock of the FHLB. The bank also maintains an investment in FRB stock. These investments are considered equity securities with no actively traded market. These investments are carried at cost, which is equal to the value at which they may be redeemed. The dividend income received from the stock is reported in interest and dividend income. We conduct a periodic review and evaluation of our FHLB and FRB stock to determine if any impairment exists. No impairment existed in the years ended December 31, 2022 or 2021. 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 and commercial agriculture loans. The Company did not incur any lower of cost or fair value provision in the years ended 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 though 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 120 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 restructurings (“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 include 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 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. 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. Substantially Risk Free – These borrowers have virtually no of default or loss given default and present no identifiable or potential adverse risk to the Company. Documented repayment is either backed by the full faith and credit of the United States Government or secured by cash collateral at a ratio of 115% of the principal borrowed. The collateral must be in the possession of the Company and free from potential claim. In addition, these credits will conform in all aspects to established loan policies and procedures, laws, rules, and regulations. Nominal Risk – Pass/Watch Special Mention Substandard Doubtful Loss 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 fair 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. 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 the specific portfolio category. Specific 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 classified as substandard or doubtful in addition to loans either on nonaccrual, considered a TDR, or when other conditions such as delinquency or covenant violations exist. 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 loan’s 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 the 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 the 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 and adjusted as deemed necessary. The review of the appropriateness of the ALL 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 changes in any of the following factors: • Concentrations of credit • International risk • Trends in volume, maturity, and composition of loans • Volume and trend in delinquency, nonaccrual, and classified assets • Economic conditions • Geographic distance • Policy and procedures or underwriting standards • Staff experience and ability • Value of underlying collateral • Competition, legal, or regulatory environment • Quality of loan review and Board oversight 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 on the consolidated balance sheets and the charge to income that establishes this liability is included in other expense on the consolidated income statements. Premises and Equipment Premises and equipment are stated at cost, less accumulated depreciation and amortization. Depreciation is computed using the straight-line method over the estimated useful lives of the assets. Leasehold improvements are amortized over the terms of the leases or the estimated useful lives of the improvements, whichever is shorter. Building improvements are amortized between twenty Years Building and improvements 20 - 30 Furniture and equipment 5 - 10 Electronic equipment and software 3 - 5 Leases At inception, contracts are evaluated to determine whether the contract constitutes a lease agreement. For contracts that are determined to be an operating lease, a corresponding Right of Use (“ROU”) asset and operating lease liability are recorded in separate line items on the consolidated balance sheets. ROU assets represent the Company’s right to use an underlying asset during the lease term and a lease liability represents the Company’s commitment to make contractually obligated lease payments. Operating lease ROU assets and liabilities are recognized at the commencement date of the lease and are based on the present value of lease payments over the lease term. The measurement of the operating lease ROU asset includes any lease payments made and is reduced by lease incentives that are paid or are payable to the Company. Variable lease payments that depend on an index are included in lease payments based on the rate in effect at the commencement date of the lease. Lease payments are recognized on a straight-line basis as part of occupancy expense over the lease term. As the rate implicit in the lease is not readily determinable, the Company’s incremental borrowing rate is used to determine the present value of lease payments. This rate gives consideration to the applicable FHLB collateralized borrowing rates and is based on the information available at the commencement date. The Company has elected to apply the short-term lease measurement and recognition exemption to leases with an initial term of 12 months or less, therefore, these leases are not recorded on the Company’s consolidated balance sheets. Lease expense of these leases is recognized over the lease term on a straight-line basis. The Company’s lease agreements may include options to extend or terminate the lease. These options are included in the lease term when it is reasonably certain that the option will be exercised. In addition to the package of practical expedients, the Company also elected the practical expedient that allows lessees to make an accounting policy election to not separate non-lease components from the associated lease component, and instead account for them all together as part of the applicable lease component. The majority of the Company’s non-lease components, such as common area maintenance and taxes, are variable and expensed as incurred. Variable payment amounts are determined in arrears by the landlord depending on actual costs incurred. Other Acquired Through Foreclosure, Net Other acquired through foreclosure Servicing Assets The guaranteed portion of certain SBA loans can be sold into the secondary market. Servicing assets are recognized as separate assets when loans are sold with servicing retained. Servicing assets are amortized in proportion to, and over the period of, estimated future net servicing income. The Company uses industry prepayment statistics and its own prepayment experience in estimating the expected life of the loans. Management evaluates its servicing assets for impairment quarterly. Servicing assets are evaluated for impairment based upon the fair value of the rights as compared to amortized cost. Fair value is determined using discounted future cash flows calculated on a loan-by-loan basis and aggregated by predominate risk characteristics. The initial servicing asset and resulting gain on sale for SBA loan sales are calculated based on the difference between the best actual par and premium bids on an individual loan basis. SBA servicing assets measured at fair value were $26 thousand and $44 thousand for the years ended December 31, 2022 and 2021, respectively. Changes in the fair values are recorded in other income in the consolidated income statements. In prior periods, the Company carried SBA servicing assets measured under the amortization method. There were no remaining SBA servicing assets measured at amortized cost at December 31, 2022 or 2021 . CWB is an approved Federal Agricultural Mortgage Corporation (“Farmer Mac”) seller/servicer. Servicing assets/liabilities are recognized as separate assets/liabilities as certain servicing requirements are retained. Servicing assets are amortized over the period of estimated net servicing income. CWB uses Farmer Mac prepayment statistics in estimating the expected life of the loans. Management evaluates its servicing assets for impairment quarterly. Servicing assets are evaluated for impairment based on the fair value of the rights as compared to amortized cost. Fair value is determined using discounted future cash flows calculated on a loan-by-loan basis. The initial servicing asset and resulting gain is calculated based on the contractual net servicing fees. Farmer Mac servicing assets are valued based on the net servicing fee, estimated life of seven years, and discounted by the bank’s borrowing rate. Farmer Mac servicing assets measured under the amortization method were $1.5 million and $1.6 million for the years ended December 31, 2022 and 2021, respectively. Servicing assets are recorded in other assets on the consolidated balance sheets Year Ended December 31 SBA servicing assets measured at fair value 2022 2021 2020 (in thousands) Balance, beginning of period $ 44 $ 43 $ 40 Additions - - - Amortization, net - - - Valuation adjustment (18 ) 1 3 Balance, end of period $ 26 $ 44 $ 43 Year Ended December 31 SBA servicing assets measured using the amortization method 2022 2021 2020 (in thousands) Balance, beginning of period $ - $ 27 $ 41 Additions - - - Amortization, net - (6 ) (14 ) Valuation adjustment - (21 ) - Balance, end of period $ - $ - $ 27 Year Ended December 31 Farmer Mac servicing assets measured using the amortization method 2022 2021 2020 (in thousands) Balance, beginning of period $ 1,556 $ 1,391 $ 765 Additions 257 475 920 Amortization, net (359 ) (310 ) (294 ) Valuation adjustment - - - Balance, end of period $ 1,454 $ 1,556 $ 1,391 Transfers of Financial Assets Transfers of financial assets are accounted for as sales when control over the assets has been relinquished. Control over transferred assets is deemed to have been surrendered when the assets have been isolated from the Company, the transferee obtains the right (free of conditions that constrain it from taking advantage of that right) to pledge and exchange the transferred assets, and the Company does not maintain effective control over the transferred assets through an agreement to repurchase them before their maturity. Bank Owned Life Insurance Bank owned life insurance is stated at its cash surrender value with changes recorded in other income in the consolidated income statements. The cash surrender value of the underlying policies was $8.7 million and $9.8 million as of December 31, 2022 and 2021, respectively, and was recorded in other assets on the consolidated balance sheets. There are no loans offset against cash surrender values, and there are no restrictions as to the use of proceeds. Fair Value of Financial Instruments The Company uses fair value measurements to record fair value adjustments to certain assets and liabilities. FASB ASC 820, Fair Value Measurements and Disclosures • 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 |
INVESTMENT SECURITIES
INVESTMENT SECURITIES | 12 Months Ended |
Dec. 31, 2022 | |
INVESTMENT SECURITIES [Abstract] | |
INVESTMENT SECURITIES | 2. INVESTMENT SECURITIES The amortized cost and estimated fair value of investment securities are as follows: December 31, 2022 Amortized Cost Gross Unrealized Gains Gross Unrealized (Losses) Fair Value Securities available-for-sale (in thousands) U.S. government agency notes $ 4,081 $ 26 $ — $ 4,107 U.S. government agency collateralized mortgage obligations (“CMO”) 4,475 — (179 ) 4,296 U.S. Treasury securities 9,984 — (14 ) 9,970 Corporate debt securities 9,250 — (935 ) 8,315 Total $ 27,790 $ 26 $ (1,128 ) $ 26,688 Securities held-to-maturity U.S. government agency mortgage-backed securities (“MBS”) $ 2,557 $ 3 $ (137 ) $ 2,423 Total $ 2,557 $ 3 $ (137 ) $ 2,423 Securities measured at fair value Equity securities: Farmer Mac class A stock $ 66 $ 159 $ — $ 225 Total $ 66 $ 159 $ — $ 225 December 31, 2021 Amortized Cost Gross Unrealized Gains Gross Unrealized (Losses) Fair Value Securities available-for-sale (in thousands) U.S. government agency notes $ 5,476 $ 32 $ — $ 5,508 U.S. government agency CMO 4,862 31 (10 ) 4,883 Corporate debt securities 9,250 102 (32 ) 9,320 Total 19,588 165 (42 ) 19,711 Securities held-to-maturity U.S. government agency MBS $ 2,815 $ 159 $ — $ 2,974 Total $ 2,815 $ 159 $ — $ 2,974 Securities measured at fair value Equity securities: Farmer Mac class A stock $ 66 $ 182 $ — $ 248 Total $ 66 $ 182 $ — $ 248 At December 31, 2022 and 2021, $21.1 million and $13.2 million of securities at carrying value, respectively, were pledged to the Federal Home Loan Bank (“FHLB”), as collateral for current and future advances. The Company had no sales of investment securities in 2022, 2021, or 2020. The maturity periods and weighted average yields of investment securities at December 31, 2022 and 2021 were as follows: December 31, 2022 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 $ — — $ — — $ 519 3.59 % $ 3,588 4.40 % $ 4,107 4.30 % U.S. government agency CMO — — — — — — 4,296 4.63 % 4,296 4.63 % U.S. Treasury securities 9,970 2.06 % — — — — — — 9,970 2.06 % Corporate debt securities — — — — 8,315 3.74 % — — 8,315 3.74 % Total $ 9,970 2.06 % $ — — $ 8,834 3.73 % $ 7,884 4.53 % $ 26,688 3.34 % Securities held-to-maturity U.S. government agency MBS $ — — $ — — $ 746 3.60 % $ 1,811 3.68 % $ 2,557 3.66 % Total $ — — $ — — $ 746 3.60 % $ 1,811 3.68 % $ 2,557 3.66 % December 31, 2021 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 $ — — $ 661 0.59 % $ 4,847 1.30 % $ — — $ 5,508 1.21 % U.S. government agency CMO — — 3,905 0.50 % 978 0.77 % — — 4,883 0.55 % Corporate debt securities — — 9,320 3.74 % — — — — 9,320 3.74 % Total $ — 0.00 % $ 13,886 2.68 % $ 5,825 1.21 % $ — 0.00 % $ 19,711 2.25 % Securities held-to-maturity U.S. government agency MBS $ — — $ 2,065 2.87 % $ 750 3.58 % $ — — $ 2,815 3.06 % Total $ — — $ 2,065 2.87 % $ 750 3.58 % $ — — $ 2,815 3.06 % The amortized cost and fair value of investment securities by contractual maturities as of the periods presented were as shown below: December 31, 2022 2021 Amortized Cost Estimated Fair Value Amortized Cost Estimated Fair Value Securities available for sale (in thousands) Due in one year or less $ 9,984 $ 9,970 $ — $ — After one year through five years — — 13,786 13,886 After five years through ten years 9,768 8,834 5,802 5,825 After ten years 8,038 7,884 — — Total $ 27,790 $ 26,688 $ 19,588 $ 19,711 Securities held to maturity Due in one year or less $ — $ — $ — $ — After one year through five years — — 2,065 2,137 After five years through ten years 746 705 750 837 After ten years 1,811 1,718 — — Total $ 2,557 $ 2,423 $ 2,815 $ 2,974 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. As of December 31, 2022 and 2021, securities that were in an unrealized loss position and length of time that individual securities have been in a continuous loss position are summarized as follows December 31, 2022 Less Than Twelve Months More Than Twelve Months Total Gross Unrealized Losses Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses Fair Value Securities available-for-sale (in thousands) U.S. government agency CMO $ (130 ) $ 3,690 $ (49 ) $ 606 $ (179 ) $ 4,296 U.S. Treasury securities (14 ) 9,970 — — (14 ) 9,970 Corporate debt securities (764 ) 6,986 (171 ) 1,329 (935 ) 8,315 Total $ (908 ) $ 20,646 $ (220 ) $ 1,935 $ (1,128 ) $ 22,581 Securities held-to-maturity U.S. government agency MBS $ (137 ) $ 2,115 $ — $ — $ (137 ) $ 2,115 Total $ (137 ) $ 2,115 $ — $ — $ (137 ) $ 2,115 December 31, 2021 Less Than Twelve Months More Than Twelve Months Total Gross Unrealized Losses Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses Fair Value Securities available-for-sale (in thousands) U.S. government agency notes $ — $ — $ — $ — $ — $ — U.S. government agency CMO — — (10 ) 977 (10 ) 977 Corporate debt securities (32 ) 2,968 — — (32 ) 2,968 Total $ (32 ) $ 2,968 $ (10 ) $ 977 $ (42 ) $ 3,945 As of December 31, 2022 and 2021, there were 37 and 4 securities, respectively, 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 December 31, 2022 and 2021, 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. |
LOANS HELD FOR SALE AND LOANS S
LOANS HELD FOR SALE AND LOANS SERVICED FOR OTHERS | 12 Months Ended |
Dec. 31, 2022 | |
LOANS HELD FOR SALE AND LOANS SERVICED FOR OTHERS [Abstract] | |
LOANS HELD FOR SALE AND LOANS SERVICED FOR OTHERS | 3. LOANS HELD FOR SALE AND LOANS SERVICED FOR OTHERS As of December 31, 2022 and 2021, the Company had approximately $5.2 million and $6.3 million, respectively, of SBA loans included in loans held for sale. 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 December 31, 2022 and 2021, the Company had $15.9 million and $17.1 million of USDA loans included in loans held for sale, respectively. The unpaid balance of loans serviced for others as of the periods presented are shown below: December 31, 2022 December 31, 2021 (in thousands) Farmer Mac $ 155,522 $ 142,677 SBA 1,926 2,709 USDA, FSA, and USDA Business and Industry 735 745 Total loans serviced for others $ 158,183 $ 146,131 |
LOANS HELD FOR INVESTMENT
LOANS HELD FOR INVESTMENT | 12 Months Ended |
Dec. 31, 2022 | |
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: December 31, 2022 2021 (in thousands) Manufactured housing $ 315,825 $ 297,363 Commercial real estate 545,317 480,801 Commercial 59,070 55,287 SBA 3,482 23,659 HELOC 2,613 3,579 Single family real estate 8,709 8,749 Consumer 107 109 Gross loans held for investment 935,123 869,547 Deferred fees, net (787 ) (838 ) Discount on SBA loans (27 ) (34 ) Loans held for investment 934,309 868,675 Allowance for loan losses (10,765 ) (10,404 ) Loans held for investment, net $ 923,544 $ 858,271 The following tables present the contractual aging of the recorded investment in past due held for investment loans by class of loans: December 31, 2022 Current 30-59 Days Past Due 60-89 Days Past Due Over 90 Days Past Due Total Past Due Nonaccrual Total Recorded Investment Over 90 Days and Accruing (in thousands) Manufactured housing $ 314,997 $ 665 $ 102 $ — $ 767 $ 61 $ 315,825 $ — Commercial real estate: Commercial real estate 481,599 1,160 — — 1,160 — 482,759 — SBA 504 1st trust deed 12,947 — — — — — 12,947 — Land 11,237 — — — — — 11,237 — Construction 38,374 — — — — — 38,374 — Commercial 59,070 — — — — — 59,070 — SBA 2,529 953 — — 953 — 3,482 — HELOC 2,613 — — — — — 2,613 — Single family real estate 8,559 — — — — 150 8,709 — Consumer 107 — — — — — 107 — Total $ 932,032 $ 2,778 $ 102 $ — $ 2,880 $ 211 $ 935,123 $ — December 31, 2021 Current 30-59 Days Past Due 60-89 Days Past Due Over 90 Days Past Due Total Past Due Nonaccrual Total Recorded Investment Over 90 Days and Accruing (in thousands) Manufactured housing $ 296,715 $ 342 $ — $ — $ 342 $ 306 $ 297,363 $ — Commercial real estate: Commercial real estate 431,062 — — — — — 431,062 — SBA 504 1st trust deed 16,961 — — — — — 16,961 — Land 7,185 — — — — — 7,185 — Construction 25,593 — — — — — 25,593 — Commercial 55,287 — — — — — 55,287 — SBA 23,296 223 139 — 362 1 23,659 — HELOC 3,579 — — — — — 3,579 — Single family real estate 8,491 — — — — 258 8,749 — Consumer 109 — — — — — 109 — Total $ 868,278 $ 565 $ 139 $ — $ 704 $ 565 $ 869,547 $ — 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 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 TDR loans for the years ended December 31, 2022, 2021, and 2020 was $38 thousand, $154 thousand, and $255 thousand, respectively. Allowance for Loan Losses The following tables summarize the changes in the allowance for loan losses by portfolio type: For the Year Ended December 31, Manufactured Housing Commercial Real Estate Commercial SBA HELOC Single Family Real Estate Consumer Total 2022 (in thousands) Beginning balance $ 2,606 $ 6,729 $ 923 $ 22 $ 18 $ 105 $ 1 $ 10,404 Charge-offs — — — (182 ) — — — (182 ) Recoveries 139 80 190 316 12 — 1 738 Net (charge-offs) recoveries 139 80 190 134 12 — 1 556 Provision (credit) for loan losses 1,134 (829 ) (366 ) (135 ) (3 ) 2 2 (195 ) Ending balance $ 3,879 $ 5,980 $ 747 $ 21 $ 27 $ 107 $ 4 $ 10,765 2021 Beginning balance $ 2,612 $ 5,950 $ 1,379 $ 118 $ 25 $ 108 $ 2 $ 10,194 Charge-offs — — — — — — (1 ) (1 ) Recoveries 218 80 40 47 6 1 — 392 Net (charge-offs) recoveries 218 80 40 47 6 1 (1 ) 391 Provision (credit) for loan losses (224 ) 699 (496 ) (143 ) (13 ) (4 ) — (181 ) Ending balance $ 2,606 $ 6,729 $ 923 $ 22 $ 18 $ 105 $ 1 $ 10,404 2020 Beginning balance $ 2,184 $ 5,217 $ 1,162 $ 32 $ 27 $ 92 $ 3 $ 8,717 Charge-offs — — — — — — — — Recoveries 27 80 133 7 6 1 — 254 Net (charge-offs) recoveries 27 80 133 7 6 1 — 254 Provision (credit) for loan losses 401 653 84 79 (8 ) 15 (1 ) 1,223 Ending balance $ 2,612 $ 5,950 $ 1,379 $ 118 $ 25 $ 108 $ 2 $ 10,194 The following tables present impairment method information related to loans and allowance for loan losses by loan portfolio segment: Manufactured Housing Commercial Real Estate Commercial SBA HELOC Single Family Real Estate Consumer Total Loans Loans Held for Investment as of December 31, 2022 (in thousands) Recorded Investment: Impaired loans with an allowance recorded $ 2,918 $ 209 $ 67 $ 41 $ — $ 208 $ — $ 3,443 Impaired loans with no allowance recorded 1,166 — 1,297 — — 151 — 2,614 Total loans individually evaluated for impairment 4,084 209 1,364 41 — 359 — 6,057 Loans collectively evaluated for impairment 311,741 545,108 57,706 3,441 2,613 8,350 107 929,066 Total loans held for investment $ 315,825 $ 545,317 $ 59,070 $ 3,482 $ 2,613 $ 8,709 $ 107 $ 935,123 Unpaid Principal Balance Impaired loans with an allowance recorded $ 2,918 $ 209 $ 67 $ 41 $ — $ 208 $ — $ 3,443 Impaired loans with no allowance recorded 1,166 — 1,297 — — 151 — 2,614 Total loans individually evaluated for impairment 4,084 209 1,364 41 — 359 — 6,057 Loans collectively evaluated for impairment 311,741 545,108 57,706 3,441 2,613 8,350 107 929,066 Total loans held for investment $ 315,825 $ 545,317 $ 59,070 $ 3,482 $ 2,613 $ 8,709 $ 107 $ 935,123 Related Allowance for Loan Losses Impaired loans with an allowance recorded $ 157 $ 18 $ — $ 1 $ — $ 8 $ — $ 184 Impaired loans with no allowance recorded — — — — — — — — Total loans individually evaluated for impairment 157 18 — 1 — 8 — 184 Loans collectively evaluated for impairment 3,722 5,962 747 20 27 99 4 10,581 Total loans held for investment $ 3,879 $ 5,980 $ 747 $ 21 $ 27 $ 107 $ 4 $ 10,765 Manufactured Housing Commercial Real Estate Commercial SBA HELOC Single Family Real Estate Consumer Total Loans Loans Held for Investment as of December 31, 2021 (in thousands) Recorded Investment: Impaired loans with an allowance recorded $ 3,563 $ 220 $ 85 $ 194 $ — $ 425 $ — $ 4,487 Impaired loans with no allowance recorded 1,358 1,402 1,505 226 — 258 — 4,749 Total loans individually evaluated for impairment 4,921 1,622 1,590 420 — 683 — 9,236 Loans collectively evaluated for impairment 292,442 479,179 53,697 23,239 3,579 8,066 109 860,311 Total loans held for investment $ 297,363 $ 480,801 $ 55,287 $ 23,659 $ 3,579 $ 8,749 $ 109 $ 869,547 Unpaid Principal Balance Impaired loans with an allowance recorded $ 3,563 $ 220 $ 85 $ 194 $ — $ 683 $ — $ 4,745 Impaired loans with no allowance recorded 1,358 1,402 1,505 226 — — — 4,491 Total loans individually evaluated for impairment 4,921 1,622 1,590 420 — 683 — 9,236 Loans collectively evaluated for impairment 292,442 479,179 53,697 23,239 3,579 8,066 109 860,311 Total loans held for investment $ 297,363 $ 480,801 $ 55,287 $ 23,659 $ 3,579 $ 8,749 $ 109 $ 869,547 Related Allowance for Loan Losses Impaired loans with an allowance recorded $ 210 $ 17 $ — $ 1 $ — $ 12 $ — $ 240 Impaired loans with no allowance recorded — — — — — — — — Total loans individually evaluated for impairment 210 17 — 1 — 12 — 240 Loans collectively evaluated for impairment 2,396 6,712 923 21 18 93 1 10,164 Total loans held for investment $ 2,606 $ 6,729 $ 923 $ 22 $ 18 $ 105 $ 1 $ 10,404 No impaired loans were guaranteed by government agencies at December 31, 2022. There were $0.3 million of impaired loans guaranteed by government agencies at December 31, 2021. 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 above as “Impaired loans with no allowance recorded.” The valuation allowance disclosed above is included in the allowance for loan losses reported in the consolidated balance sheets as of December 31, 2022 and 2021. The following table summarizes the average investment in impaired loans by class of loans and the related interest income recognized: 2022 2021 2020 Average Investment in Impaired Loans Interest Income Average Investment in Impaired Loans Interest Income Average Investment in Impaired Loans Interest Income Manufactured housing $ 4,396 $ 344 $ 5,816 $ 383 $ 7,483 $ 556 Commercial real estate: Commercial real estate — — — — 67 — SBA 504 1st 446 16 1,509 116 527 71 Land — — — — — — Construction — — — — — — Commercial 1,459 93 1,506 100 1,660 7 SBA 134 23 421 27 335 1 HELOC — — — — — — Single family real estate 523 25 1,606 34 2,279 123 Consumer — — — — — — Total $ 6,958 $ 501 $ 10,858 $ 660 $ 12,351 $ 758 Interest income recorded on these loans materially approximated income that would have been recorded on the cash basis during each period presented. The Company is not committed to lend significant additional funds on these impaired 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”. For a detailed discussion on these risk classifications see Note 1 - Summary of Significant Accounting Policies – Allowance for Loan Losses. Risk ratings are updated as part of the normal loan monitoring process, at a minimum, annually. The following tables present gross loans by risk rating: December 31, 2022 Pass Special Mention Substandard Doubtful Total (in thousands) Manufactured housing $ 314,771 $ — $ 1,054 $ — $ 315,825 Commercial real estate: Commercial real estate 460,110 13,381 8,008 — 481,499 SBA 504 1st trust deed 12,477 — 470 — 12,947 Land 11,237 — — — 11,237 Construction 38,374 — — — 38,374 Commercial 52,384 2,723 2,728 — 57,835 SBA 1,644 — — — 1,644 HELOC 2,613 — — — 2,613 Single family real estate 8,554 — 155 — 8,709 Consumer 107 — — — 107 Total, net $ 902,271 $ 16,104 $ 12,415 $ — $ 930,790 Government guaranteed loans 4,333 — — — 4,333 Total $ 906,604 $ 16,104 $ 12,415 $ — $ 935,123 December 31, 2021 Pass Special Mention Substandard Doubtful Total (in thousands) Manufactured housing $ 295,810 $ — $ 1,553 $ — $ 297,363 Commercial real estate: Commercial real estate 415,471 3,043 11,255 — 429,769 SBA 504 1st trust deed 14,646 — 2,315 — 16,961 Land 7,185 — — — 7,185 Construction 25,593 — — — 25,593 Commercial 50,372 26 2,265 — 52,663 SBA 1,891 — 114 — 2,005 HELOC 3,579 — — — 3,579 Single family real estate 8,487 — 262 — 8,749 Consumer 109 — — — 109 Total, net $ 823,143 $ 3,069 $ 17,764 $ — $ 843,976 Government guaranteed loans 23,610 — 1,961 — 25,571 Total $ 846,753 $ 3,069 $ 19,725 $ — $ 869,547 There were no loans classified as “Loss” at December 31, 2022 or 2021. 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 total carrying amount of loans that were classified as TDRs at December 31, 2022 and 2021, was $6.0 million and $8.6 million, respectively. TDRs that were performing according to their modified terms as of December 31, 2022 and 2021, were $5.8 million and $8.4 million, respectively. The following tables summarize the financial effects of TDR loans by class for the periods presented: For the Year Ended December 31, 2022 Number of Loans Pre- Modification Recorded Investment Post Modification Recorded Investment Balance of Loans with Rate Reduction Balance of Loans with Term Extension Effect on Allowance for Loan Losses (dollars in thousands) Manufactured housing 2 $ 221 $ 221 $ — $ — $ — Total 2 $ 221 $ 221 $ — $ — $ — For the year ended December 31 2021 Number of Loans Pre- Modification Recorded Investment Post Modification Recorded Investment Balance of Loans with Rate Reduction Balance of Loans with Term Extension Effect on Allowance Loan Losses (dollars in thousands) Manufactured housing 1 $ 167 $ 167 $ — $ — $ — Total 1 $ 167 $ 167 $ — $ — $ — For the year ended December 31 2020 Number of Loans Pre- Modification Recorded Investment Post Modification Recorded Investment Balance of Loans with Rate Reduction Balance of Loans with Term Extension Effect on Allowance for Loan Losses (dollars in thousands) Manufactured housing 5 $ 56 $ 56 $ 56 $ 56 $ 1 Commercial 1 1,469 1,469 — — 33 SBA 1 17 17 — — — Total 7 $ 1,542 $ 1,542 $ 56 $ 56 $ 34 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. The Company had no TDR’s with payment defaults for the twelve months ended December 31, 2022, 2021, or 2020. At December 31, 2022, there were no material loan commitments outstanding on TDR loans. Related Parties Principal stockholders, directors, and executive officers of the Company, together with companies they control and family members, are considered to be related parties. In the ordinary course of business, the Company has extended credit to these related parties. Federal banking regulations require that any such extensions of credit not be offered on terms more favorable than would be offered to non-related party borrowers of similar creditworthiness. The following table summarizes the aggregate activity in such loans: Year Ended December 31, 2022 2021 (in thousands) Balance, beginning $ 2,919 $ 2,989 New loans — 165 Repayments and other (297 ) (235 ) Balance, ending $ 2,622 $ 2,919 None of these loans are past due, on nonaccrual status or have been restructured to provide a reduction or deferral of interest or principal because of deterioration in the financial position of the borrower. There were no loans to a related party that were considered classified loans at December 31, 2022 or 2021. Unfunded loan commitments outstanding with related parties total approximately $0.3 million at December 31, 2022 and $0.6 million at December 31 2021. |
PREMISES AND EQUIPMENT
PREMISES AND EQUIPMENT | 12 Months Ended |
Dec. 31, 2022 | |
PREMISES AND EQUIPMENT [Abstract] | |
PREMISES AND EQUIPMENT | 5. PREMISES AND EQUIPMENT Year Ended December 31, 2022 2021 (in thousands) Bank premises and land $ 3,983 $ 3,959 Furniture, fixtures, and equipment 10,865 10,637 Leasehold improvements 4,992 4,986 Construction in progress 122 140 19,962 19,722 Accumulated depreciation (13,858 ) (13,146 ) Premises and equipment, net $ 6,104 $ 6,576 |
OTHER ASSETS ACQUIRED THROUGH F
OTHER ASSETS ACQUIRED THROUGH FORECLOSURE | 12 Months Ended |
Dec. 31, 2022 | |
OTHER ASSETS ACQUIRED THROUGH FORECLOSURE [Abstract] | |
OTHER ASSETS ACQUIRED THROUGH FORECLOSURE | 6. OTHER ASSETS ACQUIRED THROUGH FORECLOSURE The following table summarizes the changes in other assets acquired through foreclosure: December 31, 2022 2021 2020 (in thousands) Balance, beginning of period $ 2,518 $ 2,614 $ 2,524 Additions — 136 106 Proceeds from dispositions (384 ) — — Gains (losses) on sales, net 116 (232 ) (16 ) Balance, end of period $ 2,250 $ 2,518 $ 2,614 |
DEPOSITS
DEPOSITS | 12 Months Ended |
Dec. 31, 2022 | |
DEPOSITS [Abstract] | |
DEPOSITS | 7. DEPOSITS The table below summarizes deposits by type: December 31, 2022 2021 (in thousands) Non-interest bearing demand deposits $ 216,494 $ 209,893 Interest-bearing deposits: NOW accounts 38,068 39,289 Money market deposit account 390,105 498,219 Savings accounts 23,490 23,675 Time deposits of $250,000 or more 6,693 17,612 Other time deposits 200,234 161,443 Total deposits $ 875,084 $ 950,131 Of the total deposits at December 31, 2022, $668.2 million may be immediately withdrawn. Time certificates of deposit are the only deposits which have a specified maturity. The summary of the contractual maturities for all time deposits is as follows: (in thousands) 2023 $ 115,033 2024 34,606 2025 9,485 2026 42,972 2027 4,831 Total $ 206,927 The Company through the bank is a member of the Certificate of Deposit Account Registry Service (“CDARS”) and Insured Cash Sweep (“ICS”) services, which provides Federal Deposit Insurance Corporation (“FDIC”) insurance for large deposits. Federal banking law and regulation place restrictions on depository institutions regarding brokered deposits as they pose increased liquidity risk for institutions that gather significant amounts of brokered deposits. At December 31, 2022 and 2021, the Company had $51.1 million and $6.5 million, respectively, of reciprocal CDARS deposits. At December 31, 2022 and 2021, the Company had $69.2 million and $93.3 million, respectively of ICS deposits. The Company also accepts deposits from related parties which totaled $29.3 million at December 31, 2022 and $41.8 million at December 31, 2021. |
BORROWINGS
BORROWINGS | 12 Months Ended |
Dec. 31, 2022 | |
BORROWINGS [Abstract] | |
BORROWINGS | 8. BORROWINGS FHLB Advances - December 31, 2022 2021 Contractual Maturity Date Amount Rate Amount Rate (dollars in thousands) April 15, 2025 $ 6,000 0.76 % $ 6,000 0.76 % April 15, 2025 39,000 0.78 % 39,000 0.78 % June 23, 2025 30,000 0.95 % 30,000 0.95 % June 23, 2025 15,000 0.92 % 15,000 0.92 % Total FHLB advances $ 90,000 $ 90,000 Weighted average rate 0.86 % 0.86 % All of the Company’s outstanding advances as of December 31, 2022 and 2021 were at fixed rates of interest. The Company also had $39.0 million of letters of credit with FHLB at December 31, 2022 to secure public funds. The Company, through the Bank, has a blanket lien credit line with the FHLB. FHLB advances are collateralized in the aggregate by the Company’s eligible loans and securities. At December 31, 2022, the Company had $21.1 million of securities and $232.6 million of loans pledged to the FHLB. At December 31, 2022, the Company had $41.6 million available for additional borrowing. At December 31, 2021, the Company had pledged to the FHLB, $13.2 million of securities and $286.6 million of loans. At December 31, 2021, CWB had $44.5 million available for additional borrowing. Total FHLB interest expense for the years ended December 31, 2022, 2021 and 2020 was $0.8 million, $0.9 million and $1.4 million, respectively. Line of Credit – In September of 2021, the Company entered into an unsecured line of credit agreement for up to $5.0 million at Prime +0.25%. The Company must maintain a compensating deposit with the lender of $1.0 million. In addition, the Company must maintain a minimum debt service coverage ratio of 1.65 to 1, a minimum Tier 1 leverage ratio of 7.0%, a minimum total risked based capital ratio of 10.0% and a maximum net non-accrual ratio of not more than 3%. The line of credit matured in September 2022 and the Company renewed the line of credit for an additional one-year term and increased the amount available to $10.0 million with no other changes to the financial terms or covenants. As of December 31, 2022 and 2021, there were no outstanding balances on the revolving line of credit. Federal Reserve Bank The Company has established a credit line with the FRB. Advances are collateralized in the aggregate by eligible loans. As of December 31, 2022 and 2021, there were $248.6 million and $259.5 million, respectively, of loans pledged as collateral to the FRB. There were no outstanding FRB advances as of December 31, 2022 and 2021. Available borrowing capacity was $78.9 million and $119.0 million as of December 31, 2022 and 2021, respectively. Federal Funds Purchased Lines– |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2022 | |
COMMITMENTS AND CONTINGENCIES [Abstract] | |
COMMITMENTS AND CONTINGENCIES | 9. COMMITMENTS AND CONTINGENCIES Unfunded Commitments and Letters of Credit The Company is party to financial instruments with off-balance sheet risk in the normal course of business to meet the financing needs of its customers. These financial instruments include commitments to extend credit and standby letters of credit. They involve, to varying degrees, elements of credit risk in excess of amounts recognized in the consolidated balance sheets. Lines of credit are obligations to lend money to a borrower. Credit risk arises when the borrowers’ current financial condition may indicate less ability to pay than when the commitment was originally made. In the case of standby letters of credit, the risk arises from the possibility of the failure of the customer to perform according to the terms of a contract. In such a situation, the third party might draw on the standby letter of credit to pay for completion of the contract and the Company would look to its customer to repay these funds with interest. To minimize the risk, the Company uses the same credit policies in making commitments and conditional obligations as it would for a loan to that customer. Standby letters of credit are commitments issued by the Company to guarantee the performance of a customer to a third party in borrowing arrangements. Typically, letters of credit issued have expiration dates within one year. A summary of the contractual amounts for unfunded commitments and letters of credit are as follows: Year Ended December 31, 2022 2021 (in thousands) Commitments to extend credit $ 100,011 $ 85,238 Standby letters of credit — 17 Total $ 100,011 $ 85,255 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. The Company has exposure to credit losses from unfunded commitments and letters of credit. As funds have not been disbursed on these commitments, they are not reported as loans outstanding. Credit losses related to these commitments are not included in the allowance for credit losses reported in Note 4 - Loans Held for Investment of these consolidated financial statements and are accounted for as a separate loss contingency as a liability. This loss contingency for unfunded loan commitments and letters of credit was $94 thousand and $94 thousand as of December 31, 2022 and 2021, respectively. Changes to this liability are adjusted through other non-interest expense. Loan Sales and Servicing The Company retains a certain level of risk relating to the servicing activities and retained interest in sold loans. In addition, during the period of time that the loans are held for sale, the Company is subject to various business risks associated with the lending business, including borrower default, foreclosure, and the risk that a rapid increase in interest rates would result in a decline of the value of loans held for sale to potential purchasers. In connection with certain loan sales, the Company enters agreements which generally require the company to repurchase or substitute loans in the event of a breach of a representation or warranty made by the Company to the loan purchaser, any misrepresentation during the loan origination process or, in some cases, upon any fraud or early default on such loans. The Company has sold loans that are guaranteed or insured by government agencies for which the Company retained all servicing rights and responsibilities. The Company is required to perform certain monitoring functions in connection with these loans to preserve the guarantee by the government agency and prevent loss to the Company in the event of nonperformance by the borrower. Management believes that the Company is in compliance with these requirements. Interest rate risk The Company assumes interest rate risk (the risk to the Company’s earnings and capital from changes in interest rate levels) as a result of its normal operations. As a result, the fair values of the Company’s financial instruments as well as its future net interest income will change when interest rate levels change and that change may be either favorable or unfavorable to the Company. Interest rate risk exposure is measured using interest rate sensitivity analysis to determine the change in the net portfolio value and net interest income resulting from hypothetical changes in interest rates. If potential changes to net portfolio value and net interest income resulting from hypothetical interest rate changes are not within the limits established by the Board of Directors, the Board of Directors may direct management to adjust the asset and liability mix to bring interest rate risk within board-approved limits. As of December 31, 2022, the Company’s interest rate risk profile was within Board-approved limits. The Company’s subsidiary bank has an Asset and Liability Management Committee charged with managing interest rate risk within Board approved limits. Such limits are structured to prohibit an interest rate risk profile that is significantly asset or liability sensitive. Other The Company is involved in various other litigation matters of a routine nature that are being handled and defended in the ordinary course of the Company’s business. In the opinion of Management, based in part on consultation with legal counsel, the resolution of these litigation matters will not have a material impact on the Company’s financial position or results of operations. |
STOCKHOLDERS' EQUITY
STOCKHOLDERS' EQUITY | 12 Months Ended |
Dec. 31, 2022 | |
STOCKHOLDERS' EQUITY [Abstract] | |
STOCKHOLDERS' EQUITY | 10. STOCKHOLDERS’ EQUITY Common Stock During the years ended December 31, 2022, 2021, and 2020, the Company paid $2.6 million, $2.3 million, and $1.7 million, respectively, of dividends on common stock. In 2021, the Board of Directors extended the repurchase program for $4.5 million until August 31, 2023. Under this program the Company has repurchased 350,189 common stock shares for $3.1 million at an average price of $8.75 per share. There were no shares repurchased during the years ended December 31, 2022, 2021, or 2020. Equity Compensation Plans The Company has two stock-based compensation plans that are currently available. Both stock options and restricted stock awards can be granted under the terms of the plans. Stock options granted under the terms of the plan generally have a vesting period of 5 years and a contractual life of 10 years, while restricted stock awards generally vest over 5 years. The Company recognizes compensation cost ratably over the requisite service period for all awards. As of December 31, 2022, 353,301 shares were available for future grants. Stock Options A summary of the assumptions used in calculating the fair value of stock option awards during the years ended December 31, 2022, 2021 and 2020 are as follows: December 31, 2022 2021 2020 Expected life in years 6.3 6.4 6.3 Risk-free interest rate 2.53 % 1.80 % 0.66 % Expected volatility 28.81 % 36.40 % 24.20 % Annual dividend yield 2.05 % 1.94 % 2.54 % A summary of stock option activity under the plan is presented below: Year ended December 31, 2022 Option Shares Weighted Average Exercise Price Weighted Average Remaining Term Aggregate Intrinsic Value (dollars in thousands, except exercise price) Outstanding options, beginning of period 685,547 $ 9.47 Granted 55,500 14.14 Exercised (110,497 ) 8.82 Forfeited or expired (24,600 ) 11.12 Outstanding options, end of period 605,950 $ 9.95 5.84 $ 3,041 Options exercisable, end of period 337,270 $ 8.99 4.47 $ 2,257 Options expected to vest, end of period 552,049 $ 9.76 5.58 $ 2,875 As of December 31, 2022, there was $0.4 million of total unrecognized compensation cost related to unvested stock options granted under the Company’s plan. That cost is expected to be recognized over a weighted average period of 3.3 years. The total intrinsic value of options exercised during the years ended December 31, 2022, 2021 and 2020, was $0.5 million, $0.9 million, and a de minimis amount, respectively. Restricted Stock Awards The following table summarizes the change in nonvested restricted stock awards for the year ended December 31, 2022: Nonvested Restricted Stock Awards Weighted Average Grant-Date Fair Value Unvested options, beginning of period 14,084 $ 12.50 Granted 23,665 14.40 Vested (2,815 ) 12.50 Forfeited — — Unvested options, end of period 34,934 $ 13.78 As of December 31, 2022, there was $0.3 million of total unrecognized compensation cost related to unvested restricted stock awards granted under the Company’s plan. That cost is expected to be recognized over a weighted average period of 4.3 years. |
CAPITAL REQUIREMENTS
CAPITAL REQUIREMENTS | 12 Months Ended |
Dec. 31, 2022 | |
CAPITAL REQUIREMENTS [Abstract] | |
CAPITAL REQUIREMENTS | 11. CAPITAL REQUIREMENTS The Federal Reserve has adopted capital adequacy guidelines that are used to assess the adequacy of capital in supervising a bank holding company. In July 2013, the federal banking agencies approved the final rules (“Final Rules”) to establish a new comprehensive regulatory capital framework with a phase-in period beginning January 1, 2015, and ending January 1, 2019. The Final Rules implement the third installment of the Basel Accords (“Basel III”) regulatory capital reforms and changes required by the Dodd-Frank Wall Street Reform and Consumer Protection Act (“Dodd-Frank Act”) and substantially amend the regulatory risk-based capital rules applicable to the Company. Basel III redefines the regulatory capital elements and minimum capital ratios, introduces regulatory capital buffers above those minimums, revises rules for calculating risk-weighted assets and adds a new component of Tier 1 capital called Common Equity Tier 1, which includes common equity and retained earnings and excludes preferred equity. In November 2019, the federal banking agencies jointly issued a final rule, which provides for an additional optional, simplified measure of capital adequacy, the community bank leverage ratio framework. The final rule was effective January 1, 2020. Under this framework, the bank would choose the option of using the community bank leverage ratio (CBLR). In order to qualify, a community banking organization is defined as having less than $10 billion in total consolidated assets, a leverage ratio greater than 9%, off-balance sheet exposures of 25% or less of total consolidated assets, and trading assets and liabilities of 5% or less of total consolidated assets. A CBLR bank may opt out of the framework at any time, without restriction, by reverting to the generally applicable risk-based capital rules. The Company chose the CBLR option for calculation of its capital ratio in the first quarter of 2020. As of the fourth quarter 2021, the Company rescinded its CBLR election. The following tables illustrates the Bank’s regulatory ratios and the Federal Reserve’s current adequacy guidelines as of December 31, 2022 and 2021. The Federal Reserve’s fully phased-in guidelines are also summarized. Total Capital (To Risk- Weighted Assets) Tier 1 Capital (To Risk- Weighted Assets) Common Equity Tier 1 (To Risk- Weighted Assets) Leverage Ratio/Tier1 Capital (To Average Assets) December 31, 2022 CWB’s actual regulatory ratios 12.56 % 11.44 % 11.44 % 10.34 % Minimum capital requirements 8.00 % 6.00 % 4.50 % 4.00 % Well-capitalized requirements 10.00 % 8.00 % 6.50 % 5.00 % Minimum capital requirements including fully phased in capital conservation buffer 10.50 % 8.50 % 7.00 % N/A Total Capital (To Risk- Weighted Assets) Tier 1 Capital (To Risk- Weighted Assets) Common Equity Tier 1 (To Risk- Weighted Assets) Leverage Ratio/Tier1 Capital (To Average Assets) December 31, 2021 CWB’s actual regulatory ratios 12.19 % 11.02 % 11.02 % 8.56 % Minimum capital requirements 8.00 % 6.00 % 4.50 % 4.00 % Well-capitalized requirements 10.00 % 8.00 % 6.50 % 5.00 % Minimum capital requirements including fully phased in capital conservation buffer 10.50 % 8.50 % 7.00 % N/A As of the most recent formal notification from the Bank’s primary regulatory agency, the Bank was categorized as “well capitalized.” There are no conditions or events since that notification that management believes have changed the Bank’s categorization. |
REVENUE RECOGNITION
REVENUE RECOGNITION | 12 Months Ended |
Dec. 31, 2022 | |
REVENUE RECOGNITION [Abstract] | |
REVENUE RECOGNITION | 12. REVENUE RECOGNITION The Company adopted ASU No, 2014-09 “Revenue from Contracts with Customers” (Topic 606) and all subsequent ASUs that modified Topic 606 on January 1, 2018. The implementation of the new standard did not have a material impact on the measurement or recognition of revenue; as such, a cumulative effect adjustment to opening retained earnings was not deemed necessary. Results for reporting periods beginning after January 1, 2018, are presented under Topic 606, while prior period amounts were not adjusted and continue to be reported in accordance with our historic accounting under Topic 605. Topic 606 does not apply to revenue associated with financial instruments, including revenue from loans and securities. In addition, certain non-interest income streams such as servicing rights, financial guarantees and certain credit card fees are also not in scope of the new guidance. Topic 606 is applicable to non-interest income streams such as deposit related fees, interchange fees and merchant income. However, the recognition of these income streams did not change upon the adoption of Topic 606. Substantially all of the Company’s revenue is generated from contracts with customers. Non-interest revenue streams in-scope of Topic 606 are discussed below. Service Charges on Deposit Accounts Service charges on deposit accounts consist of monthly service fees, check orders, account analysis fees, and other deposit account related fees. The Company’s performance obligation for monthly service fees and account analysis fees is generally satisfied, and the related income recognized, over the period in which the service is provided. Check orders and other deposit-related fees are largely transactional based and, therefore, the Company’s performance obligation is satisfied and related income recognized, at a point in time. Payment for service charges on deposit accounts is primarily received immediately or in the following month through a direct charge to customers’ accounts. Exchange Fees and Other Service Charges Exchange fees and other service charges are primarily comprised of debit and credit card income, merchant services income, ATM fees and other service charges. Debit and credit card income is primarily comprised of interchange fees earned whenever the Company’s debit and credit cards are processed through card payment networks such as Visa or MasterCard. Merchant services income is primarily fees charged to merchants to process their debit and credit card transactions. ATM fees are primarily generated when a Company cardholder uses a non-Company ATM or a non-Company cardholder uses a Company ATM. Other service charges include fees from processing wire transfers, cashier’s checks and other services. The Company’s performance obligation for exchange and other service charges is largely satisfied, and related revenue recognized, when the services are rendered or upon completion. Payment is typically received immediately or in the following month. The following table presents non-interest income, segregated by revenue streams in-scope and out-of-scope of Topic 606, for periods indicated. Non-interest income Years Ended December 31, In-scope of Topic 606: 2022 2021 2020 Service charges on deposit accounts $ 335 $ 243 $ 298 Exchange fees and other service charges 518 468 157 Non-interest income (in-scope of Topic 606) 853 711 455 Non-interest income (out-of-scope of Topic 606) 3,125 3,042 3,457 Total $ 3,978 $ 3,753 $ 3,912 Contract Balances A contract asset balance occurs when an entity performs a service for a customer before the customer pays consideration (resulting in a contract receivable) or before payment is due (resulting in a contract asset). A contract liability balance is an entity’s obligation to transfer a service to a customer for which the entity has already received payment (or payment is due) from the customer. The Company’s non-interest income streams are largely based on transactional activity. Consideration is often received immediately or shortly after the Company satisfies its performance obligation and income is recognized. The Company does not typically enter into long-term revenue contracts with customers, and therefore, does not experience significant contract balances. As of December 31, 2022 and 2021, the Company did not have any signficant contract balances. Contract Acquisition Costs In connection with the adoption of Topic 606, an entity is required to capitalize, and subsequently amortize into expense, certain incremental costs of obtaining a contract with a customer if these costs are expected to be recovered. The incremental costs of obtaining a contract are those costs that an entity incurs to obtain a contract with a customer that it would not have incurred if the contract had not been obtained. The Company utilizes the practical expedient which allows entities to immediately expense contract acquisition costs when the asset that would have resulted from capitalizing these costs would have been amortized in one year or less. |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2022 | |
INCOME TAXES [Abstract] | |
INCOME TAXES | 13. INCOME TAXES The provision for income taxes consisted of the following: December 31, 2022 2021 2020 Current: (in thousands) Federal $ 3,518 $ 3,671 $ 2,874 State 1,994 2,046 1,595 5,512 5,717 4,469 Deferred: Federal (178 ) (371 ) (651 ) State (72 ) (134 ) (308 ) (250 ) (505 ) (959 ) Total provision for income taxes $ 5,262 $ 5,212 $ 3,510 A reconciliation between the statutory income tax rate and the Company’s effective tax rate is as follows: December 31, 2022 2021 2020 Federal income tax at statutory rate 21.0 % 21.0 % 21.0 % State franchise tax, net of federal benefit 8.2 % 8.6 % 8.6 % Other (1.1 )% (1.1 )% 0.3 % Tax law change 0.0 % 0.0 % 0.0 % Total provision for income taxes 28.1 % 28.5 % 29.9 % The cumulative tax effects of the primary temporary differences are as shown in the following table: December 31, 2022 2021 Deferred Tax Assets: (in thousands) Allowance for loan losses $ 3,127 $ 2,978 Bonus accrual 8 300 Deferred compensation 1,057 944 Lease liability 1,555 1,549 Deferred state taxes 419 435 Unrealized loss on AFS securities 305 — Other 586 349 Total gross deferred tax assets 7,057 6,555 Deferred tax asset valuation allowance — — Total deferred tax assets 7,057 6,555 Deferred Tax Liabilities: Depreciation (469 ) (527 ) Right of use asset (1,535 ) (1,489 ) Unrealized gain on AFS securities — (57 ) Other — (41 ) Total deferred tax liabilities (2,004 ) (2,114 ) Net deferred tax assets $ 5,053 $ 4,441 Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts and their respective tax basis including operating losses and tax credit carryforwards. Net deferred tax assets of $5.1 million and $4.4 million at December 31, 2022 and December 31, 2021, respectively, are reported in other assets on the consolidated balance sheets. Accounting standards Codification Topic 740, Income Taxes There was no valuation allowance on deferred tax assets at December 31, 2022 or December 31, 2021. The Company is subject to the provisions of ASC 740, Income Taxes The Company is subject to income taxation in the United States and certain state jurisdictions. The Company’s federal and state income tax returns are filed on a consolidated basis. The Company is generally open to examination by tax authorities for the years 2019 and later and state tax authorities for the years 2018 and later. |
LEASES
LEASES | 12 Months Ended |
Dec. 31, 2022 | |
LEASES [Abstract] | |
LEASES | 14. LEASES The Company has operating leases for office space, which typically have terms of between 2 and 10 years. Rents usually increase annually in accordance with defined rent steps or based on current year consumer price index adjustments. When renewal options exist, the Company generally does not deem them to be reasonably certain to be exercised, and therefore the amounts are not recognized as part of the lease liability nor the right-of-use asset. As of December 31, 2022, the balance of the right-of-use assets was $5.2 million and the lease liabilities were $5.3 million. The right-of-use assets are included in other assets other liabilities 2022 2021 Lease cost: Operating lease cost $ 1,012 $ 1,000 Sublease income — — Total lease cost $ 1,012 $ 1,000 Other information: Cash paid for amounts included in the measurement of lease liabilities - operating leases $ 1,003 $ 992 Weighted average remaining lease term in years - operating leases 7.02 8.17 Weighted average discount rate - operating leases 3.26 % 3.25 % Future minimum operating lease payments as of December 31, 2022 are as follows: 2022 2023 $ 1,014 2024 1,025 2025 976 2026 876 2027 473 Thereafter 1,538 Total future minimum lease payments $ 5,902 Less: remaining imputed interest (641 ) Total lease liabilities $ 5,261 |
EMPLOYEE BENEFIT PLANS
EMPLOYEE BENEFIT PLANS | 12 Months Ended |
Dec. 31, 2022 | |
EMPLOYEE BENEFIT PLANS [Abstract] | |
EMPLOYEE BENEFIT PLANS | 15. EMPLOYEE BENEFIT PLANS 401(k) Plan: The Company has a qualified benefit plan Deferred Compensation Plans A deferred compensation plan covers the executive officers. Under the plan, the Company pays each participant a percentage of their base salary plus interest. Vesting occurs at age 65. A liability is accrued for the obligation under these plans. The expense incurred for the deferred compensation for the years ended December 31, 2022, 2021, and 2020 was $0.3 million, $0.2 million, and $0.3 million, respectively. The Company recognized a deferred compensation liability of $2.1 million and $2.0 million as of December 31, 2022 and 2021, respectively. The Company also provides an unfunded nonqualified deferred compensation arrangement to provide supplemental retirement benefits for the Participants which are a select group of management or highly compensated employees of the Company. The Participants may defer up to 30% of their base salary and bonus each plan year. The 36-month certificate of deposit rate is paid on the vested balance. Salary Continuation The Company has agreements with certain key officers, which provide for a monthly cash payment to the officers or beneficiaries in the event of death, disability or retirement, beginning in the month after the retirement date or death and extending for a period of fifteen years subject to vesting. The income from the policy investments will help fund this liability. At December 31, 2022 and 2021, the Company had accrued salary continuation liability for these agreements of $1.5 million and $1.2 million, respectively, which was included in other liabilities on the consolidated balance sheets. The cash surrender value of the life insurance policies was $8.7 million and $9.8 at December 31, 2022 and 2021, respectively, and is included in other assets on the consolidated balance sheets. |
FAIR VALUE MEASUREMENT
FAIR VALUE MEASUREMENT | 12 Months Ended |
Dec. 31, 2022 | |
FAIR VALUE MEASUREMENT [Abstract] | |
FAIR VALUE MEASUREMENT | 16. FAIR VALUE MEASUREMENT The fair value of an asset or liability is the price that would be received to sell the asset or paid to transfer the liability in an orderly transaction occurring in the principal market for such asset or liability. ASC 820 establishes a fair value hierarchy that prioritizes the inputs and valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (“Level 1”) and the lowest priority to unobservable inputs (“Level 3”). The three levels of the fair value hierarchy under ASC 820 and the methods and assumptions used by the Company in estimating the fair value of its financial instruments are described in Note 1 - Summary of Significant Accounting Policies – Fair Value of Financial Instruments of these Notes to the Consolidated Financial Statements. 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: December 31, 2022 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable (Level 3) Fair Value Assets: (in thousands) Investment securities measured at fair value $ 225 $ — $ — $ 225 Investment securities available-for-sale: U.S. government agency notes — 4,107 — 4,107 U.S. government agency CMOs — 4,296 — 4,296 U.S. Treasury securities — 9,970 — 9,970 Corporate debt securities — 8,315 — 8,315 Interest only strips — — 7 7 Servicing assets — — 26 26 $ 225 $ 26,688 $ 33 $ 26,946 Fair Value Measurements at the End of the Reporting Period Using: December 31, 2021 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Fair Value Assets: (in thousands) Investment securities measured at fair value $ 248 $ — $ — $ 248 Investment securities available-for-sale: U.S. government agency notes — 5,508 — 5,508 U.S. government agency CMOs — 4,883 — 4,883 Corporate debt securities — 9,320 — 9,320 Interest only strips — — 15 15 Servicing assets — — 1,600 1,600 $ 248 $ 19,711 $ 1,615 $ 21,574 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 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. 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. 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, as follows: Fair Value Measurements at the End of the Reporting Period Using Total Quoted Prices in Active Markets for Identical Assets (Level 1) Active Markets for Similar Assets (Level 2) Unobservable Inputs (Level 3) (in thousands) As of December 31, 2022 Impaired loans $ 3,805 $ — $ 3,805 $ — Other assets acquired through foreclosure 2,250 — 2,250 — $ 6,055 $ — $ 6,055 $ — As of December 31, 2021 Impaired loans $ 3,785 $ — $ 3,785 $ — Other assets acquired through foreclosure 2,518 — 2,518 — $ 6,303 $ — $ 6,303 $ — 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. Other assets acquired through foreclosure 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: December 31, 2022 Carrying Fair Value Amount Level 1 Level 2 Level 3 Total Financial assets: (in thousands) Cash and cash equivalents $ 64,690 $ 64,690 $ — $ — $ 64,690 FRB and FHLB stock 4,533 — 4,533 — 4,533 Investment securities - available-for-sale 26,688 — 26,688 — 26,688 Investment securities - held-to-maturity 2,557 — 2,423 — 2,423 Investment securities - measured at fair value 225 225 — — 225 Loans held for sale and loans held for investment, net 944,577 — 892,134 3,805 895,939 Accrued interest receivable 5,295 — 5,295 — 5,295 Servicing assets 1,480 — — 2,646 2,646 Interest only strips 7 — — 7 7 Financial liabilities: Deposits 875,084 — 867,697 — 867,697 FHLB advances 90,000 — 83,322 — 83,322 Accrued interest payable 126 — 126 — 126 December 31, 2021 Carrying Fair Value Amount Level 1 Level 2 Level 3 Total Financial assets: (in thousands) Cash and cash equivalents $ 208,375 $ 208,375 $ — $ — $ 208,375 FRB and FHLB stock 4,441 — 4,441 — 4,441 Investment securities - available-for-sale 19,711 — 19,711 — 19,711 Investment securities - held-to-maturity 2,815 — 2,974 — 2,974 Investment securities - measured at fair value 248 248 — — 248 Loans held for sale and loans held for investment, net 881,679 — 870,868 5,452 876,320 Accrued interest receivable 5,841 — 5,841 — 5,841 Servicing assets 1,600 — — 2,254 2,254 Interest only strips 15 — — 15 15 Financial liabilities: Deposits 950,131 — 948,648 — 948,648 FHLB advances 90,000 — 88,409 — 88,409 Accrued interest payable 58 — 58 — 58 Fair value of commitments Loan commitments on which the committed interest rates were less than the current market rate are insignificant at December 31, 2022 and 2021. The estimated fair value of standby letters of credit outstanding at December 31, 2022 and 2021 were also insignificant. |
ACCUMULATED OTHER COMPREHENSIVE
ACCUMULATED OTHER COMPREHENSIVE INCOME | 12 Months Ended |
Dec. 31, 2022 | |
ACCUMULATED OTHER COMPREHENSIVE INCOME [Abstract] | |
ACCUMULATED OTHER COMPREHENSIVE INCOME | 17. ACCUMULATED OTHER COMPREHENSIVE INCOME The following table summarizes the changes in other comprehensive income by component, net of tax for the period indicated: Year Ended December 31, 2022 2021 2020 Unrealized holding gains (losses) on AFS (in thousands) Beginning balance $ 92 $ 35 $ (78 ) Other comprehensive income (loss) before reclassifications (863 ) 57 113 Amounts reclassified from accumulated other comprehensive income — — — Net current-period other comprehensive income (863 ) 57 113 Ending balance $ (771 ) $ 92 $ 35 There were no reclassifications out of accumulated other comprehensive income for the years ended December 31, 2022, 2021 and 2020. |
PARENT COMPANY FINANCIAL INFORM
PARENT COMPANY FINANCIAL INFORMATION | 12 Months Ended |
Dec. 31, 2022 | |
PARENT COMPANY FINANCIAL INFORMATION [Abstract] | |
PARENT COMPANY FINANCIAL INFORMATION | 18. PARENT COMPANY FINANCIAL INFORMATION The condensed financial statements of the holding company are presented in the following tables: COMMUNITY WEST BANCSHARES Condensed Balance Sheets December 31, 2022 2021 (in thousands) Assets: Cash and cash equivalents (including interest-bearing deposits in other financial institutions) $ 67 $ 539 Investment in subsidiary 112,183 100,642 Other assets 419 198 Total assets $ 112,669 $ 101,379 Liabilities and Stockholders’ Equity: Other borrowings $ — $ — Other liabilities 19 4 Total liabilities 19 4 Total stockholders’ equity 112,650 101,375 Total liabilities and stockholders’ equity $ 112,669 $ 101,379 COMMUNITY WEST BANCSHARES Condensed Income Statements December 31, 2022 2021 2020 (in thousands) Interest income $ — $ — $ 3 Interest expense 16 17 296 Net interest expense (16 ) (17 ) (293 ) Provision for loan losses — — — Net interest income after provision for loan losses (16 ) (17 ) (293 ) Equity in income from consolidated subsidiary 13,779 13,271 8,826 Total income 13,763 13,254 8,533 Total non-interest expenses 525 420 411 Income before income tax benefit 13,238 12,834 8,122 Income tax benefit (211 ) (267 ) (123 ) Net income $ 13,449 $ 13,101 $ 8,245 COMMUNITY WEST BANCSHARES Condensed Statements of Cash Flows December 31, 2022 2021 2020 (in thousands) Cash Flows from Operating Activities: Net income $ 13,449 $ 13,101 $ 8,245 Adjustments to reconcile net income to cash provided by operating activities: Equity in undistributed income from subsidiary (13,779 ) (13,271 ) (8,826 ) Stock-based compensation 289 318 319 Changes in: Other assets (221 ) 41 (1 ) Other liabilities 15 (215 ) (185 ) Net cash used in operating activities (247 ) (26 ) (448 ) Cash Flows from Investing Activities: Net dividends from and investment in subsidiary 1,375 1,600 1,197 Net cash provided by investing activities 1,375 1,600 1,197 Cash Flows from Financing Activities: Common stock dividends paid (2,574 ) (2,312 ) (1,652 ) Proceeds from issuance of common stock 974 1,204 4 Net cash used in financing activities (1,600 ) (1,108 ) (1,648 ) Net (decrease) increase in cash and cash equivalents (472 ) 466 (899 ) Cash and cash equivalents at beginning of year 539 73 972 Cash and cash equivalents at end of year $ 67 $ 539 $ 73 |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2022 | |
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 investment securities available for sale. 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. |
Concentrations of Lending Activities | Concentrations of Lending Activities The Company’s lending activities are primarily driven by the customers served in the market areas where the Company has branch offices in the Central Coast of California. The Company monitors concentrations within selected categories such as geography and product. The Company makes manufactured housing, commercial, SBA, construction, commercial real estate, and consumer loans to customers through branch offices located in the Company’s primary markets. The Company’s business is concentrated in these areas and the loan portfolio includes significant credit exposure to the manufactured housing and commercial real estate markets of these areas. As of December 31, 2022 and 2021, manufactured housing loans comprised 33.1% and 33.3%, respectively, of total loans. As of December 31, 2022 and 2021, commercial real estate loans accounted for approximately 57.1% and 53.9% of total loans, respectively. Approximately 24.5% and 27.8% of these commercial real estate loans were owner occupied at December 31, 2022 and 2021, respectively. Substantially all of these loans are secured by first liens with an average loan to value ratios of 50.4% and 53.7% at December 31, 2022 and 2021, respectively. The Company was within established lending policy limits at December 31, 2022 and 2021 |
Reclassifications | Reclassifications Certain amounts in the consolidated financial statements as of and for the years ended December 31, 2022 and 2021 have been reclassified to conform to the current presentation. The reclassifications have no effect on net income or stockholders’ equity as previously reported. |
Business Segments | Business Segments Reportable business segments are determined using the “management approach” and are intended to present reportable segments consistent with how the chief operating decision maker organizes segments within the company for making operating decisions and assessing performance. As of December 31, 2022, 2021 and 2020, the Company had only one reportable business segment. |
Cash and Cash Equivalents | Cash and Cash Equivalents For purposes of reporting cash flows, cash and cash equivalents include cash on hand and amounts due from banks (including cash items in process of clearing). Cash flows from loans originated by the Company and deposits are reported net. The Company maintains amounts due from banks, which at times may exceed federally insured limits. The Company has not experienced any losses in such accounts. |
Cash Reserve Requirement | Cash Reserve Requirement Depository institutions are required by law to maintain reserves against their transaction deposits. The reserves must be held in cash or with the Federal Reserve Bank (“FRB”). The amount of the reserve varies by bank as the bank is permitted to meet this requirement by maintaining the specified amount as an average balance over a two-week period. The Federal Reserve reduced the reserve requirement ratio to zero percent across all deposit tiers as of March 26, 2020, to aid institutions impacted by COVID-19. |
Investment Securities | Investment Securities Investment securities may be classified as held-to-maturity (“HTM”), available-for-sale (“AFS”), or trading. The appropriate classification is initially decided at the time of purchase. Securities classified as held-to-maturity are those debt securities the Company has both the intent and ability to hold to maturity regardless of changes in market conditions, liquidity needs, or general economic conditions. These securities are carried at amortized cost. The sale of a security within three months of its maturity date or after the majority of the principal outstanding has been collected is considered a maturity for purposes of classification and disclosure. Securities classified as AFS or trading are reported as an asset on the Consolidated Balance Sheets at their estimated fair value. As the fair value of AFS securities changes, the changes are reported net of income tax as an element of other comprehensive income (loss) (“OCI”), except for impaired securities. When AFS securities are sold, the unrealized gain or loss is reclassified from OCI to non-interest income. The changes in the fair values of trading securities are reported in non-interest income. Securities classified as AFS are debt securities the Company intends to hold for an indefinite period of time, but not necessarily to maturity. Any decision to sell a security classified as AFS would be based on various factors, including significant movements in interest rates, changes in the maturity mix of the Company’s assets and liabilities, liquidity needs, decline in credit quality, and regulatory capital considerations. Trading securities are carried at their estimated fair value. The changes in the fair value of trading securities are adjusted through non-interest income monthly. Interest income on securities is recognized based on the coupon rate and increased by accretion of discounts earned or decreased by the amortization of premiums paid over the contractual life of the security using the interest method. For mortgage-backed securities, estimates of prepayments are considered in the constant yield calculations. In estimating whether there are any other than temporary impairment losses, management considers 1) the length of time and the extent to which the fair value has been less than amortized cost, 2) the financial condition and near term prospects of the issuer, 3) the impact of changes in market interest rates, and 4) the intent and ability of the Company to retain its investment for a period of time sufficient to allow for any anticipated recovery in fair value and it is not more likely than not the Company would be required to sell the security. Declines in the fair value of individual debt securities available for sale that are deemed to be other than temporary are reflected in earnings when identified. The fair value of the debt security then becomes the new cost basis. For individual debt securities where the Company does not intend to sell the security and it is not more likely than not that the Company will be required to sell the security before recovery of its amortized cost basis, the other than temporary decline in fair value of the debt security related to 1) credit loss is recognized in earnings, and 2) market or other factors is recognized in other comprehensive income or loss. For individual debt securities where the Company intends to sell the security or more likely than not will not recover all of its amortized cost, the other than temporary impairment is recognized in earnings equal to the entire difference between the securities cost basis and its fair value at the balance sheet date. For individual debt securities for which a credit loss has been recognized in earnings, interest accruals and amortization and accretion of premiums and discounts are suspended when the credit loss is recognized. Interest received after accruals have been suspended is recognized on a cash basis. |
Federal Home Loan Bank ("FHLB") and Federal Reserve Bank ("FRB") Stock | Federal Home Loan Bank (“FHLB”) and Federal Reserve Bank (“FRB”) Stock The Company’s subsidiary bank is a member of the FHLB system and maintains an investment in capital stock of the FHLB. The bank also maintains an investment in FRB stock. These investments are considered equity securities with no actively traded market. These investments are carried at cost, which is equal to the value at which they may be redeemed. The dividend income received from the stock is reported in interest and dividend income. We conduct a periodic review and evaluation of our FHLB and FRB stock to determine if any impairment exists. No impairment existed in the years ended December 31, 2022 or 2021. |
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 and commercial agriculture loans. The Company did not incur any lower of cost or fair value provision in the years ended |
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 though 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 120 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 restructurings (“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 include 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 | Allowance for Loan 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. 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. Substantially Risk Free – These borrowers have virtually no of default or loss given default and present no identifiable or potential adverse risk to the Company. Documented repayment is either backed by the full faith and credit of the United States Government or secured by cash collateral at a ratio of 115% of the principal borrowed. The collateral must be in the possession of the Company and free from potential claim. In addition, these credits will conform in all aspects to established loan policies and procedures, laws, rules, and regulations. Nominal Risk – Pass/Watch Special Mention Substandard Doubtful Loss 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 fair 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. 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 the specific portfolio category. Specific 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 classified as substandard or doubtful in addition to loans either on nonaccrual, considered a TDR, or when other conditions such as delinquency or covenant violations exist. 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 loan’s 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 the 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 the 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 and adjusted as deemed necessary. The review of the appropriateness of the ALL 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 changes in any of the following factors: • Concentrations of credit • International risk • Trends in volume, maturity, and composition of loans • Volume and trend in delinquency, nonaccrual, and classified assets • Economic conditions • Geographic distance • Policy and procedures or underwriting standards • Staff experience and ability • Value of underlying collateral • Competition, legal, or regulatory environment • Quality of loan review and Board oversight |
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 on the consolidated balance sheets and the charge to income that establishes this liability is included in other expense on the consolidated income statements. |
Premises and Equipment | Premises and Equipment Premises and equipment are stated at cost, less accumulated depreciation and amortization. Depreciation is computed using the straight-line method over the estimated useful lives of the assets. Leasehold improvements are amortized over the terms of the leases or the estimated useful lives of the improvements, whichever is shorter. Building improvements are amortized between twenty Years Building and improvements 20 - 30 Furniture and equipment 5 - 10 Electronic equipment and software 3 - 5 |
Leases | Leases At inception, contracts are evaluated to determine whether the contract constitutes a lease agreement. For contracts that are determined to be an operating lease, a corresponding Right of Use (“ROU”) asset and operating lease liability are recorded in separate line items on the consolidated balance sheets. ROU assets represent the Company’s right to use an underlying asset during the lease term and a lease liability represents the Company’s commitment to make contractually obligated lease payments. Operating lease ROU assets and liabilities are recognized at the commencement date of the lease and are based on the present value of lease payments over the lease term. The measurement of the operating lease ROU asset includes any lease payments made and is reduced by lease incentives that are paid or are payable to the Company. Variable lease payments that depend on an index are included in lease payments based on the rate in effect at the commencement date of the lease. Lease payments are recognized on a straight-line basis as part of occupancy expense over the lease term. As the rate implicit in the lease is not readily determinable, the Company’s incremental borrowing rate is used to determine the present value of lease payments. This rate gives consideration to the applicable FHLB collateralized borrowing rates and is based on the information available at the commencement date. The Company has elected to apply the short-term lease measurement and recognition exemption to leases with an initial term of 12 months or less, therefore, these leases are not recorded on the Company’s consolidated balance sheets. Lease expense of these leases is recognized over the lease term on a straight-line basis. The Company’s lease agreements may include options to extend or terminate the lease. These options are included in the lease term when it is reasonably certain that the option will be exercised. In addition to the package of practical expedients, the Company also elected the practical expedient that allows lessees to make an accounting policy election to not separate non-lease components from the associated lease component, and instead account for them all together as part of the applicable lease component. The majority of the Company’s non-lease components, such as common area maintenance and taxes, are variable and expensed as incurred. Variable payment amounts are determined in arrears by the landlord depending on actual costs incurred. |
Other Assets Acquired Through Foreclosure, Net | Other Acquired Through Foreclosure, Net Other acquired through foreclosure |
Servicing Assets | Servicing Assets The guaranteed portion of certain SBA loans can be sold into the secondary market. Servicing assets are recognized as separate assets when loans are sold with servicing retained. Servicing assets are amortized in proportion to, and over the period of, estimated future net servicing income. The Company uses industry prepayment statistics and its own prepayment experience in estimating the expected life of the loans. Management evaluates its servicing assets for impairment quarterly. Servicing assets are evaluated for impairment based upon the fair value of the rights as compared to amortized cost. Fair value is determined using discounted future cash flows calculated on a loan-by-loan basis and aggregated by predominate risk characteristics. The initial servicing asset and resulting gain on sale for SBA loan sales are calculated based on the difference between the best actual par and premium bids on an individual loan basis. SBA servicing assets measured at fair value were $26 thousand and $44 thousand for the years ended December 31, 2022 and 2021, respectively. Changes in the fair values are recorded in other income in the consolidated income statements. In prior periods, the Company carried SBA servicing assets measured under the amortization method. There were no remaining SBA servicing assets measured at amortized cost at December 31, 2022 or 2021 . CWB is an approved Federal Agricultural Mortgage Corporation (“Farmer Mac”) seller/servicer. Servicing assets/liabilities are recognized as separate assets/liabilities as certain servicing requirements are retained. Servicing assets are amortized over the period of estimated net servicing income. CWB uses Farmer Mac prepayment statistics in estimating the expected life of the loans. Management evaluates its servicing assets for impairment quarterly. Servicing assets are evaluated for impairment based on the fair value of the rights as compared to amortized cost. Fair value is determined using discounted future cash flows calculated on a loan-by-loan basis. The initial servicing asset and resulting gain is calculated based on the contractual net servicing fees. Farmer Mac servicing assets are valued based on the net servicing fee, estimated life of seven years, and discounted by the bank’s borrowing rate. Farmer Mac servicing assets measured under the amortization method were $1.5 million and $1.6 million for the years ended December 31, 2022 and 2021, respectively. Servicing assets are recorded in other assets on the consolidated balance sheets Year Ended December 31 SBA servicing assets measured at fair value 2022 2021 2020 (in thousands) Balance, beginning of period $ 44 $ 43 $ 40 Additions - - - Amortization, net - - - Valuation adjustment (18 ) 1 3 Balance, end of period $ 26 $ 44 $ 43 Year Ended December 31 SBA servicing assets measured using the amortization method 2022 2021 2020 (in thousands) Balance, beginning of period $ - $ 27 $ 41 Additions - - - Amortization, net - (6 ) (14 ) Valuation adjustment - (21 ) - Balance, end of period $ - $ - $ 27 Year Ended December 31 Farmer Mac servicing assets measured using the amortization method 2022 2021 2020 (in thousands) Balance, beginning of period $ 1,556 $ 1,391 $ 765 Additions 257 475 920 Amortization, net (359 ) (310 ) (294 ) Valuation adjustment - - - Balance, end of period $ 1,454 $ 1,556 $ 1,391 |
Transfers of Financial Assets | Transfers of Financial Assets Transfers of financial assets are accounted for as sales when control over the assets has been relinquished. Control over transferred assets is deemed to have been surrendered when the assets have been isolated from the Company, the transferee obtains the right (free of conditions that constrain it from taking advantage of that right) to pledge and exchange the transferred assets, and the Company does not maintain effective control over the transferred assets through an agreement to repurchase them before their maturity. |
Bank Owned Life Insurance | Bank Owned Life Insurance Bank owned life insurance is stated at its cash surrender value with changes recorded in other income in the consolidated income statements. The cash surrender value of the underlying policies was $8.7 million and $9.8 million as of December 31, 2022 and 2021, respectively, and was recorded in other assets on the consolidated balance sheets. There are no loans offset against cash surrender values, and there are no restrictions as to the use of proceeds. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company uses fair value measurements to record fair value adjustments to certain assets and liabilities. FASB ASC 820, Fair Value Measurements and Disclosures • 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 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 December 31, 2022 or 2021. The estimated fair value amounts for December 31, 2022 and 2021 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. The information presented in Note 16 - Fair Value Measurement 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 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. 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 was 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. FRB and FHLB stock CWB is a member of the FHLB system and maintains an investment in capital stock of the FHLB. CWB also maintains an investment in FRB stock. 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 exit-pricing 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. Deposit liabilities 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 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. |
Stock-Based Compensation | Stock-Based Compensation Compensation cost is recognized for stock options and restricted stock awards issued to employees based on the fair value of the awards at the date of grant. A Black-Scholes model is utilized to estimate the fair value of stock options, while the market price of the Company’s common stock at the date of grant is used for restricted stock awards. Compensation cost is recognized over the required service period, generally defined as the vesting period. For awards with graded vesting, compensation is recognized on a straight-line basis over the requisite service period for the entire award. The Company’s accounting policy is to recognize forfeitures as they occur. |
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 the 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 net of deferred tax liabilities 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 |
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. The factors used in the earnings per share computation are as follows: Year Ended December 31 2022 2021 2020 (dollars in s, except per share amounts) Net income available to common stockholders $ 13,449 $ 13,101 $ 8,245 Weighted average number of common shares outstanding - basic 8,722,481 8,567,839 8,472,709 Add: Dilutive effects of assumed exercises of stock options 169,646 155,099 70,120 Weighted average number of common shares outstanding - diluted 8,892,127 8,722,938 8,542,829 Earnings per share: Basic $ 1.54 $ 1.53 $ 0.97 Diluted $ 1.51 $ 1.50 $ 0.97 Stock options for 95,304; 101,010; and 391,064 shares of common stock were not considered in computing diluted earnings per share for the years ended December 31, 2022, 2021, and 2020, respectively, because they were antidilutive. |
Recent Accounting Pronouncements - Not Yet Adopted | Recent Accounting Pronouncements - Not Yet Adopted In June 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-13, “Financial Instruments – Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments,” which amends the guidance for recognizing credit losses from an “incurred loss” methodology that delays recognition of credit losses until it is probable a loss has been incurred to an expected credit loss methodology. The guidance requires the use of the modified retrospective transition method by means of a cumulative-effect adjustment to equity as of the beginning of the period in which the guidance is adopted. The Company established a committee comprised of executive management and members of Accounting and Credit Administration and is using a third-party software provider specializing in CECL loss modeling. The Company performed parallel runs of the model for the three-month periods ending June 30, September 30, and December 31, 2022. The results of the parallel runs identified an expected increase to the Allowance for Credit Losses between $1.7 million and $1.9 million and an increase to the reserve for unfunded commitments of approximately $500 thousand. The Company will record the initial adjustment and after-tax charge to retained earnings in the first quarter of 2023 In March 2020, the FASB issued ASU-2020-04, “Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting,” which provide optional guidance for a limited period of time to ease the potential burden in accounting for (or recognizing the effects of) reference rate reform on financial reporting. In response to the risk of cessation of the London Interbank Offered Rate (“LIBOR”), the Company had $4.2 In March 2022, the FASB issued ASU 2022-02, “Financial Instruments-Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage Disclosures.” This Update eliminates the recognition and measurement guidance for troubled debt restructurings (“TDRs”) by creditors that currently exists. However, the Update requires new disclosures related to certain loan restructurings when a borrower is experiencing financial difficulty. Specifically, rather than applying the recognition and measurement guidance for TDRs, an entity will apply the loan refinancing and restructuring guidance to determine whether a modification or other form of restructuring results in a new loan or a continuation of an existing loan. Additionally, the new amendments require an entity to disclose current period charge-offs by year of origination of the loan in the existing vintage disclosures. The amendments in this Update are effective for the Company beginning on January 1, 2023. The Update requires prospective transition for the disclosures related to loan restructurings for borrowers experiencing financial difficulty and the presentation of gross charge-offs in the vintage disclosures. The adoption of this standard is not expected to have a material effect on the Company’s consolidated operating results or consolidated financial condition, however the required disclosures will be added to the Company’s consolidated financial statements subsequent to the date of adoption. In June 2022, the FASB issued ASU 2022-03, “Fair Value Measurement (Topic 820): Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions.” The amendments in this Update clarify that a contractual restriction on the sale of an equity security is not considered part of the unit of account of the equity security and, therefore, is not considered in measuring the fair value of that security. The amendments also clarify that an entity cannot, as a separate unit of account, recognize and measure a contractual sale restriction. The amendments also require the following disclosures for equity securities subject to contractual sale restrictions: a) the fair value of equity securities subject to contractual sale restrictions reflected in the consolidated balance sheets; b) the nature and remaining duration of the restriction(s); and c) the circumstances that could cause a lapse in the restriction(s). This new guidance will be effective for the Company on January 1, 2024. Early adoption is permitted. The amendments in this Update should be applied prospectively with any adjustments from the adoption of the amendments recognized in earnings and disclosed at the date of adoption. The adoption of this standard is not expected to have a material effect on the Company’s operating results or financial condition. |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [Abstract] | |
Estimated Useful Lives of Other Items of Premises and Equipment | Premises and equipment are stated at cost, less accumulated depreciation and amortization. Depreciation is computed using the straight-line method over the estimated useful lives of the assets. Leasehold improvements are amortized over the terms of the leases or the estimated useful lives of the improvements, whichever is shorter. Building improvements are amortized between twenty Years Building and improvements 20 - 30 Furniture and equipment 5 - 10 Electronic equipment and software 3 - 5 |
Servicing Assets Measured at Fair Value | Year Ended December 31 SBA servicing assets measured at fair value 2022 2021 2020 (in thousands) Balance, beginning of period $ 44 $ 43 $ 40 Additions - - - Amortization, net - - - Valuation adjustment (18 ) 1 3 Balance, end of period $ 26 $ 44 $ 43 |
Servicing Assets Measured Under the Amortization Method | Year Ended December 31 SBA servicing assets measured using the amortization method 2022 2021 2020 (in thousands) Balance, beginning of period $ - $ 27 $ 41 Additions - - - Amortization, net - (6 ) (14 ) Valuation adjustment - (21 ) - Balance, end of period $ - $ - $ 27 Year Ended December 31 Farmer Mac servicing assets measured using the amortization method 2022 2021 2020 (in thousands) Balance, beginning of period $ 1,556 $ 1,391 $ 765 Additions 257 475 920 Amortization, net (359 ) (310 ) (294 ) Valuation adjustment - - - Balance, end of period $ 1,454 $ 1,556 $ 1,391 |
Factors Used in Earnings Per Share Computation | The factors used in the earnings per share computation are as follows: Year Ended December 31 2022 2021 2020 (dollars in s, except per share amounts) Net income available to common stockholders $ 13,449 $ 13,101 $ 8,245 Weighted average number of common shares outstanding - basic 8,722,481 8,567,839 8,472,709 Add: Dilutive effects of assumed exercises of stock options 169,646 155,099 70,120 Weighted average number of common shares outstanding - diluted 8,892,127 8,722,938 8,542,829 Earnings per share: Basic $ 1.54 $ 1.53 $ 0.97 Diluted $ 1.51 $ 1.50 $ 0.97 |
INVESTMENT SECURITIES (Tables)
INVESTMENT SECURITIES (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
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: December 31, 2022 Amortized Cost Gross Unrealized Gains Gross Unrealized (Losses) Fair Value Securities available-for-sale (in thousands) U.S. government agency notes $ 4,081 $ 26 $ — $ 4,107 U.S. government agency collateralized mortgage obligations (“CMO”) 4,475 — (179 ) 4,296 U.S. Treasury securities 9,984 — (14 ) 9,970 Corporate debt securities 9,250 — (935 ) 8,315 Total $ 27,790 $ 26 $ (1,128 ) $ 26,688 Securities held-to-maturity U.S. government agency mortgage-backed securities (“MBS”) $ 2,557 $ 3 $ (137 ) $ 2,423 Total $ 2,557 $ 3 $ (137 ) $ 2,423 Securities measured at fair value Equity securities: Farmer Mac class A stock $ 66 $ 159 $ — $ 225 Total $ 66 $ 159 $ — $ 225 December 31, 2021 Amortized Cost Gross Unrealized Gains Gross Unrealized (Losses) Fair Value Securities available-for-sale (in thousands) U.S. government agency notes $ 5,476 $ 32 $ — $ 5,508 U.S. government agency CMO 4,862 31 (10 ) 4,883 Corporate debt securities 9,250 102 (32 ) 9,320 Total 19,588 165 (42 ) 19,711 Securities held-to-maturity U.S. government agency MBS $ 2,815 $ 159 $ — $ 2,974 Total $ 2,815 $ 159 $ — $ 2,974 Securities measured at fair value Equity securities: Farmer Mac class A stock $ 66 $ 182 $ — $ 248 Total $ 66 $ 182 $ — $ 248 |
Maturity Periods and Weighted Average Yields of Investment Securities | The maturity periods and weighted average yields of investment securities at December 31, 2022 and 2021 were as follows: December 31, 2022 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 $ — — $ — — $ 519 3.59 % $ 3,588 4.40 % $ 4,107 4.30 % U.S. government agency CMO — — — — — — 4,296 4.63 % 4,296 4.63 % U.S. Treasury securities 9,970 2.06 % — — — — — — 9,970 2.06 % Corporate debt securities — — — — 8,315 3.74 % — — 8,315 3.74 % Total $ 9,970 2.06 % $ — — $ 8,834 3.73 % $ 7,884 4.53 % $ 26,688 3.34 % Securities held-to-maturity U.S. government agency MBS $ — — $ — — $ 746 3.60 % $ 1,811 3.68 % $ 2,557 3.66 % Total $ — — $ — — $ 746 3.60 % $ 1,811 3.68 % $ 2,557 3.66 % December 31, 2021 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 $ — — $ 661 0.59 % $ 4,847 1.30 % $ — — $ 5,508 1.21 % U.S. government agency CMO — — 3,905 0.50 % 978 0.77 % — — 4,883 0.55 % Corporate debt securities — — 9,320 3.74 % — — — — 9,320 3.74 % Total $ — 0.00 % $ 13,886 2.68 % $ 5,825 1.21 % $ — 0.00 % $ 19,711 2.25 % Securities held-to-maturity U.S. government agency MBS $ — — $ 2,065 2.87 % $ 750 3.58 % $ — — $ 2,815 3.06 % Total $ — — $ 2,065 2.87 % $ 750 3.58 % $ — — $ 2,815 3.06 % |
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: December 31, 2022 2021 Amortized Cost Estimated Fair Value Amortized Cost Estimated Fair Value Securities available for sale (in thousands) Due in one year or less $ 9,984 $ 9,970 $ — $ — After one year through five years — — 13,786 13,886 After five years through ten years 9,768 8,834 5,802 5,825 After ten years 8,038 7,884 — — Total $ 27,790 $ 26,688 $ 19,588 $ 19,711 Securities held to maturity Due in one year or less $ — $ — $ — $ — After one year through five years — — 2,065 2,137 After five years through ten years 746 705 750 837 After ten years 1,811 1,718 — — Total $ 2,557 $ 2,423 $ 2,815 $ 2,974 |
Fair Value and Unrealized Losses of Securities in Unrealized Loss Position | As of December 31, 2022 and 2021, securities that were in an unrealized loss position and length of time that individual securities have been in a continuous loss position are summarized as follows December 31, 2022 Less Than Twelve Months More Than Twelve Months Total Gross Unrealized Losses Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses Fair Value Securities available-for-sale (in thousands) U.S. government agency CMO $ (130 ) $ 3,690 $ (49 ) $ 606 $ (179 ) $ 4,296 U.S. Treasury securities (14 ) 9,970 — — (14 ) 9,970 Corporate debt securities (764 ) 6,986 (171 ) 1,329 (935 ) 8,315 Total $ (908 ) $ 20,646 $ (220 ) $ 1,935 $ (1,128 ) $ 22,581 Securities held-to-maturity U.S. government agency MBS $ (137 ) $ 2,115 $ — $ — $ (137 ) $ 2,115 Total $ (137 ) $ 2,115 $ — $ — $ (137 ) $ 2,115 December 31, 2021 Less Than Twelve Months More Than Twelve Months Total Gross Unrealized Losses Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses Fair Value Securities available-for-sale (in thousands) U.S. government agency notes $ — $ — $ — $ — $ — $ — U.S. government agency CMO — — (10 ) 977 (10 ) 977 Corporate debt securities (32 ) 2,968 — — (32 ) 2,968 Total $ (32 ) $ 2,968 $ (10 ) $ 977 $ (42 ) $ 3,945 |
LOANS HELD FOR SALE AND LOANS_2
LOANS HELD FOR SALE AND LOANS SERVICED FOR OTHERS (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
LOANS HELD FOR SALE AND LOANS SERVICED FOR OTHERS [Abstract] | |
Unpaid Balance of Loan Serviced for Others | The unpaid balance of loans serviced for others as of the periods presented are shown below: December 31, 2022 December 31, 2021 (in thousands) Farmer Mac $ 155,522 $ 142,677 SBA 1,926 2,709 USDA, FSA, and USDA Business and Industry 735 745 Total loans serviced for others $ 158,183 $ 146,131 |
LOANS HELD FOR INVESTMENT (Tabl
LOANS HELD FOR INVESTMENT (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
LOANS HELD FOR INVESTMENT [Abstract] | |
Composition of Loans Held for Investment Loan Portfolio | The composition of the Company’s loans held for investment loan portfolio follows: December 31, 2022 2021 (in thousands) Manufactured housing $ 315,825 $ 297,363 Commercial real estate 545,317 480,801 Commercial 59,070 55,287 SBA 3,482 23,659 HELOC 2,613 3,579 Single family real estate 8,709 8,749 Consumer 107 109 Gross loans held for investment 935,123 869,547 Deferred fees, net (787 ) (838 ) Discount on SBA loans (27 ) (34 ) Loans held for investment 934,309 868,675 Allowance for loan losses (10,765 ) (10,404 ) Loans held for investment, net $ 923,544 $ 858,271 |
Contractual Aging of Recorded Investment in Past Due Held for Investment Loans by Class of Loans | The following tables present the contractual aging of the recorded investment in past due held for investment loans by class of loans: December 31, 2022 Current 30-59 Days Past Due 60-89 Days Past Due Over 90 Days Past Due Total Past Due Nonaccrual Total Recorded Investment Over 90 Days and Accruing (in thousands) Manufactured housing $ 314,997 $ 665 $ 102 $ — $ 767 $ 61 $ 315,825 $ — Commercial real estate: Commercial real estate 481,599 1,160 — — 1,160 — 482,759 — SBA 504 1st trust deed 12,947 — — — — — 12,947 — Land 11,237 — — — — — 11,237 — Construction 38,374 — — — — — 38,374 — Commercial 59,070 — — — — — 59,070 — SBA 2,529 953 — — 953 — 3,482 — HELOC 2,613 — — — — — 2,613 — Single family real estate 8,559 — — — — 150 8,709 — Consumer 107 — — — — — 107 — Total $ 932,032 $ 2,778 $ 102 $ — $ 2,880 $ 211 $ 935,123 $ — December 31, 2021 Current 30-59 Days Past Due 60-89 Days Past Due Over 90 Days Past Due Total Past Due Nonaccrual Total Recorded Investment Over 90 Days and Accruing (in thousands) Manufactured housing $ 296,715 $ 342 $ — $ — $ 342 $ 306 $ 297,363 $ — Commercial real estate: Commercial real estate 431,062 — — — — — 431,062 — SBA 504 1st trust deed 16,961 — — — — — 16,961 — Land 7,185 — — — — — 7,185 — Construction 25,593 — — — — — 25,593 — Commercial 55,287 — — — — — 55,287 — SBA 23,296 223 139 — 362 1 23,659 — HELOC 3,579 — — — — — 3,579 — Single family real estate 8,491 — — — — 258 8,749 — Consumer 109 — — — — — 109 — Total $ 868,278 $ 565 $ 139 $ — $ 704 $ 565 $ 869,547 $ — |
Analysis of Allowance for Loan Losses for Loans Held for Investment | The following tables summarize the changes in the allowance for loan losses by portfolio type: For the Year Ended December 31, Manufactured Housing Commercial Real Estate Commercial SBA HELOC Single Family Real Estate Consumer Total 2022 (in thousands) Beginning balance $ 2,606 $ 6,729 $ 923 $ 22 $ 18 $ 105 $ 1 $ 10,404 Charge-offs — — — (182 ) — — — (182 ) Recoveries 139 80 190 316 12 — 1 738 Net (charge-offs) recoveries 139 80 190 134 12 — 1 556 Provision (credit) for loan losses 1,134 (829 ) (366 ) (135 ) (3 ) 2 2 (195 ) Ending balance $ 3,879 $ 5,980 $ 747 $ 21 $ 27 $ 107 $ 4 $ 10,765 2021 Beginning balance $ 2,612 $ 5,950 $ 1,379 $ 118 $ 25 $ 108 $ 2 $ 10,194 Charge-offs — — — — — — (1 ) (1 ) Recoveries 218 80 40 47 6 1 — 392 Net (charge-offs) recoveries 218 80 40 47 6 1 (1 ) 391 Provision (credit) for loan losses (224 ) 699 (496 ) (143 ) (13 ) (4 ) — (181 ) Ending balance $ 2,606 $ 6,729 $ 923 $ 22 $ 18 $ 105 $ 1 $ 10,404 2020 Beginning balance $ 2,184 $ 5,217 $ 1,162 $ 32 $ 27 $ 92 $ 3 $ 8,717 Charge-offs — — — — — — — — Recoveries 27 80 133 7 6 1 — 254 Net (charge-offs) recoveries 27 80 133 7 6 1 — 254 Provision (credit) for loan losses 401 653 84 79 (8 ) 15 (1 ) 1,223 Ending balance $ 2,612 $ 5,950 $ 1,379 $ 118 $ 25 $ 108 $ 2 $ 10,194 |
Impairment Method Information Related to Loans and Allowance for Loan Losses by Loan Portfolio Segment | The following tables present impairment method information related to loans and allowance for loan losses by loan portfolio segment: Manufactured Housing Commercial Real Estate Commercial SBA HELOC Single Family Real Estate Consumer Total Loans Loans Held for Investment as of December 31, 2022 (in thousands) Recorded Investment: Impaired loans with an allowance recorded $ 2,918 $ 209 $ 67 $ 41 $ — $ 208 $ — $ 3,443 Impaired loans with no allowance recorded 1,166 — 1,297 — — 151 — 2,614 Total loans individually evaluated for impairment 4,084 209 1,364 41 — 359 — 6,057 Loans collectively evaluated for impairment 311,741 545,108 57,706 3,441 2,613 8,350 107 929,066 Total loans held for investment $ 315,825 $ 545,317 $ 59,070 $ 3,482 $ 2,613 $ 8,709 $ 107 $ 935,123 Unpaid Principal Balance Impaired loans with an allowance recorded $ 2,918 $ 209 $ 67 $ 41 $ — $ 208 $ — $ 3,443 Impaired loans with no allowance recorded 1,166 — 1,297 — — 151 — 2,614 Total loans individually evaluated for impairment 4,084 209 1,364 41 — 359 — 6,057 Loans collectively evaluated for impairment 311,741 545,108 57,706 3,441 2,613 8,350 107 929,066 Total loans held for investment $ 315,825 $ 545,317 $ 59,070 $ 3,482 $ 2,613 $ 8,709 $ 107 $ 935,123 Related Allowance for Loan Losses Impaired loans with an allowance recorded $ 157 $ 18 $ — $ 1 $ — $ 8 $ — $ 184 Impaired loans with no allowance recorded — — — — — — — — Total loans individually evaluated for impairment 157 18 — 1 — 8 — 184 Loans collectively evaluated for impairment 3,722 5,962 747 20 27 99 4 10,581 Total loans held for investment $ 3,879 $ 5,980 $ 747 $ 21 $ 27 $ 107 $ 4 $ 10,765 Manufactured Housing Commercial Real Estate Commercial SBA HELOC Single Family Real Estate Consumer Total Loans Loans Held for Investment as of December 31, 2021 (in thousands) Recorded Investment: Impaired loans with an allowance recorded $ 3,563 $ 220 $ 85 $ 194 $ — $ 425 $ — $ 4,487 Impaired loans with no allowance recorded 1,358 1,402 1,505 226 — 258 — 4,749 Total loans individually evaluated for impairment 4,921 1,622 1,590 420 — 683 — 9,236 Loans collectively evaluated for impairment 292,442 479,179 53,697 23,239 3,579 8,066 109 860,311 Total loans held for investment $ 297,363 $ 480,801 $ 55,287 $ 23,659 $ 3,579 $ 8,749 $ 109 $ 869,547 Unpaid Principal Balance Impaired loans with an allowance recorded $ 3,563 $ 220 $ 85 $ 194 $ — $ 683 $ — $ 4,745 Impaired loans with no allowance recorded 1,358 1,402 1,505 226 — — — 4,491 Total loans individually evaluated for impairment 4,921 1,622 1,590 420 — 683 — 9,236 Loans collectively evaluated for impairment 292,442 479,179 53,697 23,239 3,579 8,066 109 860,311 Total loans held for investment $ 297,363 $ 480,801 $ 55,287 $ 23,659 $ 3,579 $ 8,749 $ 109 $ 869,547 Related Allowance for Loan Losses Impaired loans with an allowance recorded $ 210 $ 17 $ — $ 1 $ — $ 12 $ — $ 240 Impaired loans with no allowance recorded — — — — — — — — Total loans individually evaluated for impairment 210 17 — 1 — 12 — 240 Loans collectively evaluated for impairment 2,396 6,712 923 21 18 93 1 10,164 Total loans held for investment $ 2,606 $ 6,729 $ 923 $ 22 $ 18 $ 105 $ 1 $ 10,404 |
Average Investment in Impaired Loans by Class and Related Interest Income Recognized | The following table summarizes the average investment in impaired loans by class of loans and the related interest income recognized: 2022 2021 2020 Average Investment in Impaired Loans Interest Income Average Investment in Impaired Loans Interest Income Average Investment in Impaired Loans Interest Income Manufactured housing $ 4,396 $ 344 $ 5,816 $ 383 $ 7,483 $ 556 Commercial real estate: Commercial real estate — — — — 67 — SBA 504 1st 446 16 1,509 116 527 71 Land — — — — — — Construction — — — — — — Commercial 1,459 93 1,506 100 1,660 7 SBA 134 23 421 27 335 1 HELOC — — — — — — Single family real estate 523 25 1,606 34 2,279 123 Consumer — — — — — — Total $ 6,958 $ 501 $ 10,858 $ 660 $ 12,351 $ 758 |
Gross Loans by Risk Rating | The following tables present gross loans by risk rating: December 31, 2022 Pass Special Mention Substandard Doubtful Total (in thousands) Manufactured housing $ 314,771 $ — $ 1,054 $ — $ 315,825 Commercial real estate: Commercial real estate 460,110 13,381 8,008 — 481,499 SBA 504 1st trust deed 12,477 — 470 — 12,947 Land 11,237 — — — 11,237 Construction 38,374 — — — 38,374 Commercial 52,384 2,723 2,728 — 57,835 SBA 1,644 — — — 1,644 HELOC 2,613 — — — 2,613 Single family real estate 8,554 — 155 — 8,709 Consumer 107 — — — 107 Total, net $ 902,271 $ 16,104 $ 12,415 $ — $ 930,790 Government guaranteed loans 4,333 — — — 4,333 Total $ 906,604 $ 16,104 $ 12,415 $ — $ 935,123 December 31, 2021 Pass Special Mention Substandard Doubtful Total (in thousands) Manufactured housing $ 295,810 $ — $ 1,553 $ — $ 297,363 Commercial real estate: Commercial real estate 415,471 3,043 11,255 — 429,769 SBA 504 1st trust deed 14,646 — 2,315 — 16,961 Land 7,185 — — — 7,185 Construction 25,593 — — — 25,593 Commercial 50,372 26 2,265 — 52,663 SBA 1,891 — 114 — 2,005 HELOC 3,579 — — — 3,579 Single family real estate 8,487 — 262 — 8,749 Consumer 109 — — — 109 Total, net $ 823,143 $ 3,069 $ 17,764 $ — $ 843,976 Government guaranteed loans 23,610 — 1,961 — 25,571 Total $ 846,753 $ 3,069 $ 19,725 $ — $ 869,547 |
Troubled Debt Restructurings | The following tables summarize the financial effects of TDR loans by class for the periods presented: For the Year Ended December 31, 2022 Number of Loans Pre- Modification Recorded Investment Post Modification Recorded Investment Balance of Loans with Rate Reduction Balance of Loans with Term Extension Effect on Allowance for Loan Losses (dollars in thousands) Manufactured housing 2 $ 221 $ 221 $ — $ — $ — Total 2 $ 221 $ 221 $ — $ — $ — For the year ended December 31 2021 Number of Loans Pre- Modification Recorded Investment Post Modification Recorded Investment Balance of Loans with Rate Reduction Balance of Loans with Term Extension Effect on Allowance Loan Losses (dollars in thousands) Manufactured housing 1 $ 167 $ 167 $ — $ — $ — Total 1 $ 167 $ 167 $ — $ — $ — For the year ended December 31 2020 Number of Loans Pre- Modification Recorded Investment Post Modification Recorded Investment Balance of Loans with Rate Reduction Balance of Loans with Term Extension Effect on Allowance for Loan Losses (dollars in thousands) Manufactured housing 5 $ 56 $ 56 $ 56 $ 56 $ 1 Commercial 1 1,469 1,469 — — 33 SBA 1 17 17 — — — Total 7 $ 1,542 $ 1,542 $ 56 $ 56 $ 34 |
Aggregate Activity with Related Parties | The following table summarizes the aggregate activity in such loans: Year Ended December 31, 2022 2021 (in thousands) Balance, beginning $ 2,919 $ 2,989 New loans — 165 Repayments and other (297 ) (235 ) Balance, ending $ 2,622 $ 2,919 |
PREMISES AND EQUIPMENT (Tables)
PREMISES AND EQUIPMENT (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
PREMISES AND EQUIPMENT [Abstract] | |
Premises and Equipment | Year Ended December 31, 2022 2021 (in thousands) Bank premises and land $ 3,983 $ 3,959 Furniture, fixtures, and equipment 10,865 10,637 Leasehold improvements 4,992 4,986 Construction in progress 122 140 19,962 19,722 Accumulated depreciation (13,858 ) (13,146 ) Premises and equipment, net $ 6,104 $ 6,576 |
OTHER ASSETS ACQUIRED THROUGH_2
OTHER ASSETS ACQUIRED THROUGH FORECLOSURE (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
OTHER ASSETS ACQUIRED THROUGH FORECLOSURE [Abstract] | |
Other Assets Acquired through Foreclosure | The following table summarizes the changes in other assets acquired through foreclosure: December 31, 2022 2021 2020 (in thousands) Balance, beginning of period $ 2,518 $ 2,614 $ 2,524 Additions — 136 106 Proceeds from dispositions (384 ) — — Gains (losses) on sales, net 116 (232 ) (16 ) Balance, end of period $ 2,250 $ 2,518 $ 2,614 |
DEPOSITS (Tables)
DEPOSITS (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
DEPOSITS [Abstract] | |
Summary of Deposits | The table below summarizes deposits by type: December 31, 2022 2021 (in thousands) Non-interest bearing demand deposits $ 216,494 $ 209,893 Interest-bearing deposits: NOW accounts 38,068 39,289 Money market deposit account 390,105 498,219 Savings accounts 23,490 23,675 Time deposits of $250,000 or more 6,693 17,612 Other time deposits 200,234 161,443 Total deposits $ 875,084 $ 950,131 |
Summary of Contractual Maturities for All Time Deposits | The summary of the contractual maturities for all time deposits is as follows: (in thousands) 2023 $ 115,033 2024 34,606 2025 9,485 2026 42,972 2027 4,831 Total $ 206,927 |
BORROWINGS (Tables)
BORROWINGS (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
BORROWINGS [Abstract] | |
Summary of FHLB Advances by Maturity Date | FHLB Advances - December 31, 2022 2021 Contractual Maturity Date Amount Rate Amount Rate (dollars in thousands) April 15, 2025 $ 6,000 0.76 % $ 6,000 0.76 % April 15, 2025 39,000 0.78 % 39,000 0.78 % June 23, 2025 30,000 0.95 % 30,000 0.95 % June 23, 2025 15,000 0.92 % 15,000 0.92 % Total FHLB advances $ 90,000 $ 90,000 Weighted average rate 0.86 % 0.86 % |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
COMMITMENTS AND CONTINGENCIES [Abstract] | |
Summary of Contractual Amounts for Unfunded Commitments and Letters of Credit | A summary of the contractual amounts for unfunded commitments and letters of credit are as follows: Year Ended December 31, 2022 2021 (in thousands) Commitments to extend credit $ 100,011 $ 85,238 Standby letters of credit — 17 Total $ 100,011 $ 85,255 |
STOCKHOLDERS' EQUITY (Tables)
STOCKHOLDERS' EQUITY (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
STOCKHOLDERS' EQUITY [Abstract] | |
Summary of Assumptions Used in Calculating Fair Value of Option Awards | A summary of the assumptions used in calculating the fair value of stock option awards during the years ended December 31, 2022, 2021 and 2020 are as follows: December 31, 2022 2021 2020 Expected life in years 6.3 6.4 6.3 Risk-free interest rate 2.53 % 1.80 % 0.66 % Expected volatility 28.81 % 36.40 % 24.20 % Annual dividend yield 2.05 % 1.94 % 2.54 % |
Summary of Stock Option Activity | A summary of stock option activity under the plan is presented below: Year ended December 31, 2022 Option Shares Weighted Average Exercise Price Weighted Average Remaining Term Aggregate Intrinsic Value (dollars in thousands, except exercise price) Outstanding options, beginning of period 685,547 $ 9.47 Granted 55,500 14.14 Exercised (110,497 ) 8.82 Forfeited or expired (24,600 ) 11.12 Outstanding options, end of period 605,950 $ 9.95 5.84 $ 3,041 Options exercisable, end of period 337,270 $ 8.99 4.47 $ 2,257 Options expected to vest, end of period 552,049 $ 9.76 5.58 $ 2,875 |
Summary of Change in Nonvested Restricted Stock Awards | The following table summarizes the change in nonvested restricted stock awards for the year ended December 31, 2022: Nonvested Restricted Stock Awards Weighted Average Grant-Date Fair Value Unvested options, beginning of period 14,084 $ 12.50 Granted 23,665 14.40 Vested (2,815 ) 12.50 Forfeited — — Unvested options, end of period 34,934 $ 13.78 |
CAPITAL REQUIREMENTS (Tables)
CAPITAL REQUIREMENTS (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
CAPITAL REQUIREMENTS [Abstract] | |
Bank's Regulatory Ratios and Federal Reserve's Current Adequacy Guidelines | The following tables illustrates the Bank’s regulatory ratios and the Federal Reserve’s current adequacy guidelines as of December 31, 2022 and 2021. The Federal Reserve’s fully phased-in guidelines are also summarized. Total Capital (To Risk- Weighted Assets) Tier 1 Capital (To Risk- Weighted Assets) Common Equity Tier 1 (To Risk- Weighted Assets) Leverage Ratio/Tier1 Capital (To Average Assets) December 31, 2022 CWB’s actual regulatory ratios 12.56 % 11.44 % 11.44 % 10.34 % Minimum capital requirements 8.00 % 6.00 % 4.50 % 4.00 % Well-capitalized requirements 10.00 % 8.00 % 6.50 % 5.00 % Minimum capital requirements including fully phased in capital conservation buffer 10.50 % 8.50 % 7.00 % N/A Total Capital (To Risk- Weighted Assets) Tier 1 Capital (To Risk- Weighted Assets) Common Equity Tier 1 (To Risk- Weighted Assets) Leverage Ratio/Tier1 Capital (To Average Assets) December 31, 2021 CWB’s actual regulatory ratios 12.19 % 11.02 % 11.02 % 8.56 % Minimum capital requirements 8.00 % 6.00 % 4.50 % 4.00 % Well-capitalized requirements 10.00 % 8.00 % 6.50 % 5.00 % Minimum capital requirements including fully phased in capital conservation buffer 10.50 % 8.50 % 7.00 % N/A |
REVENUE RECOGNITION (Tables)
REVENUE RECOGNITION (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
REVENUE RECOGNITION [Abstract] | |
Non-Interest Income | The following table presents non-interest income, segregated by revenue streams in-scope and out-of-scope of Topic 606, for periods indicated. Non-interest income Years Ended December 31, In-scope of Topic 606: 2022 2021 2020 Service charges on deposit accounts $ 335 $ 243 $ 298 Exchange fees and other service charges 518 468 157 Non-interest income (in-scope of Topic 606) 853 711 455 Non-interest income (out-of-scope of Topic 606) 3,125 3,042 3,457 Total $ 3,978 $ 3,753 $ 3,912 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
INCOME TAXES [Abstract] | |
Provision for Income Taxes | The provision for income taxes consisted of the following: December 31, 2022 2021 2020 Current: (in thousands) Federal $ 3,518 $ 3,671 $ 2,874 State 1,994 2,046 1,595 5,512 5,717 4,469 Deferred: Federal (178 ) (371 ) (651 ) State (72 ) (134 ) (308 ) (250 ) (505 ) (959 ) Total provision for income taxes $ 5,262 $ 5,212 $ 3,510 |
Reconciliation between Statutory Income Tax Rate and Effective Tax Rate | A reconciliation between the statutory income tax rate and the Company’s effective tax rate is as follows: December 31, 2022 2021 2020 Federal income tax at statutory rate 21.0 % 21.0 % 21.0 % State franchise tax, net of federal benefit 8.2 % 8.6 % 8.6 % Other (1.1 )% (1.1 )% 0.3 % Tax law change 0.0 % 0.0 % 0.0 % Total provision for income taxes 28.1 % 28.5 % 29.9 % |
Cumulative Tax Effects of Primary Temporary Differences | The cumulative tax effects of the primary temporary differences are as shown in the following table: December 31, 2022 2021 Deferred Tax Assets: (in thousands) Allowance for loan losses $ 3,127 $ 2,978 Bonus accrual 8 300 Deferred compensation 1,057 944 Lease liability 1,555 1,549 Deferred state taxes 419 435 Unrealized loss on AFS securities 305 — Other 586 349 Total gross deferred tax assets 7,057 6,555 Deferred tax asset valuation allowance — — Total deferred tax assets 7,057 6,555 Deferred Tax Liabilities: Depreciation (469 ) (527 ) Right of use asset (1,535 ) (1,489 ) Unrealized gain on AFS securities — (57 ) Other — (41 ) Total deferred tax liabilities (2,004 ) (2,114 ) Net deferred tax assets $ 5,053 $ 4,441 |
LEASES (Tables)
LEASES (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
LEASES [Abstract] | |
Lease Cost and Other Information | 2022 2021 Lease cost: Operating lease cost $ 1,012 $ 1,000 Sublease income — — Total lease cost $ 1,012 $ 1,000 Other information: Cash paid for amounts included in the measurement of lease liabilities - operating leases $ 1,003 $ 992 Weighted average remaining lease term in years - operating leases 7.02 8.17 Weighted average discount rate - operating leases 3.26 % 3.25 % |
Future Minimum Operating Lease Payments | Future minimum operating lease payments as of December 31, 2022 are as follows: 2022 2023 $ 1,014 2024 1,025 2025 976 2026 876 2027 473 Thereafter 1,538 Total future minimum lease payments $ 5,902 Less: remaining imputed interest (641 ) Total lease liabilities $ 5,261 |
FAIR VALUE MEASUREMENT (Tables)
FAIR VALUE MEASUREMENT (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
FAIR VALUE MEASUREMENT [Abstract] | |
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: December 31, 2022 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable (Level 3) Fair Value Assets: (in thousands) Investment securities measured at fair value $ 225 $ — $ — $ 225 Investment securities available-for-sale: U.S. government agency notes — 4,107 — 4,107 U.S. government agency CMOs — 4,296 — 4,296 U.S. Treasury securities — 9,970 — 9,970 Corporate debt securities — 8,315 — 8,315 Interest only strips — — 7 7 Servicing assets — — 26 26 $ 225 $ 26,688 $ 33 $ 26,946 Fair Value Measurements at the End of the Reporting Period Using: December 31, 2021 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Fair Value Assets: (in thousands) Investment securities measured at fair value $ 248 $ — $ — $ 248 Investment securities available-for-sale: U.S. government agency notes — 5,508 — 5,508 U.S. government agency CMOs — 4,883 — 4,883 Corporate debt securities — 9,320 — 9,320 Interest only strips — — 15 15 Servicing assets — — 1,600 1,600 $ 248 $ 19,711 $ 1,615 $ 21,574 |
Fair Value Measurements of Assets Measured on a Non-recurring Basis | The Company also has assets that under certain conditions are subject to measurement at fair value on a non-recurring basis, as follows: Fair Value Measurements at the End of the Reporting Period Using Total Quoted Prices in Active Markets for Identical Assets (Level 1) Active Markets for Similar Assets (Level 2) Unobservable Inputs (Level 3) (in thousands) As of December 31, 2022 Impaired loans $ 3,805 $ — $ 3,805 $ — Other assets acquired through foreclosure 2,250 — 2,250 — $ 6,055 $ — $ 6,055 $ — As of December 31, 2021 Impaired loans $ 3,785 $ — $ 3,785 $ — Other assets acquired through foreclosure 2,518 — 2,518 — $ 6,303 $ — $ 6,303 $ — |
Estimated Fair Values and Carrying Values of Financial Instruments | The estimated fair value of the Company’s financial instruments are as follows: December 31, 2022 Carrying Fair Value Amount Level 1 Level 2 Level 3 Total Financial assets: (in thousands) Cash and cash equivalents $ 64,690 $ 64,690 $ — $ — $ 64,690 FRB and FHLB stock 4,533 — 4,533 — 4,533 Investment securities - available-for-sale 26,688 — 26,688 — 26,688 Investment securities - held-to-maturity 2,557 — 2,423 — 2,423 Investment securities - measured at fair value 225 225 — — 225 Loans held for sale and loans held for investment, net 944,577 — 892,134 3,805 895,939 Accrued interest receivable 5,295 — 5,295 — 5,295 Servicing assets 1,480 — — 2,646 2,646 Interest only strips 7 — — 7 7 Financial liabilities: Deposits 875,084 — 867,697 — 867,697 FHLB advances 90,000 — 83,322 — 83,322 Accrued interest payable 126 — 126 — 126 December 31, 2021 Carrying Fair Value Amount Level 1 Level 2 Level 3 Total Financial assets: (in thousands) Cash and cash equivalents $ 208,375 $ 208,375 $ — $ — $ 208,375 FRB and FHLB stock 4,441 — 4,441 — 4,441 Investment securities - available-for-sale 19,711 — 19,711 — 19,711 Investment securities - held-to-maturity 2,815 — 2,974 — 2,974 Investment securities - measured at fair value 248 248 — — 248 Loans held for sale and loans held for investment, net 881,679 — 870,868 5,452 876,320 Accrued interest receivable 5,841 — 5,841 — 5,841 Servicing assets 1,600 — — 2,254 2,254 Interest only strips 15 — — 15 15 Financial liabilities: Deposits 950,131 — 948,648 — 948,648 FHLB advances 90,000 — 88,409 — 88,409 Accrued interest payable 58 — 58 — 58 |
ACCUMULATED OTHER COMPREHENSI_2
ACCUMULATED OTHER COMPREHENSIVE INCOME (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
ACCUMULATED OTHER COMPREHENSIVE INCOME [Abstract] | |
Changes in Other Comprehensive Income (Loss) by Component, Net of Tax | The following table summarizes the changes in other comprehensive income by component, net of tax for the period indicated: Year Ended December 31, 2022 2021 2020 Unrealized holding gains (losses) on AFS (in thousands) Beginning balance $ 92 $ 35 $ (78 ) Other comprehensive income (loss) before reclassifications (863 ) 57 113 Amounts reclassified from accumulated other comprehensive income — — — Net current-period other comprehensive income (863 ) 57 113 Ending balance $ (771 ) $ 92 $ 35 |
PARENT COMPANY FINANCIAL INFO_2
PARENT COMPANY FINANCIAL INFORMATION (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
PARENT COMPANY FINANCIAL INFORMATION [Abstract] | |
Condensed Balance Sheets | COMMUNITY WEST BANCSHARES Condensed Balance Sheets December 31, 2022 2021 (in thousands) Assets: Cash and cash equivalents (including interest-bearing deposits in other financial institutions) $ 67 $ 539 Investment in subsidiary 112,183 100,642 Other assets 419 198 Total assets $ 112,669 $ 101,379 Liabilities and Stockholders’ Equity: Other borrowings $ — $ — Other liabilities 19 4 Total liabilities 19 4 Total stockholders’ equity 112,650 101,375 Total liabilities and stockholders’ equity $ 112,669 $ 101,379 |
Condensed Income Statements | COMMUNITY WEST BANCSHARES Condensed Income Statements December 31, 2022 2021 2020 (in thousands) Interest income $ — $ — $ 3 Interest expense 16 17 296 Net interest expense (16 ) (17 ) (293 ) Provision for loan losses — — — Net interest income after provision for loan losses (16 ) (17 ) (293 ) Equity in income from consolidated subsidiary 13,779 13,271 8,826 Total income 13,763 13,254 8,533 Total non-interest expenses 525 420 411 Income before income tax benefit 13,238 12,834 8,122 Income tax benefit (211 ) (267 ) (123 ) Net income $ 13,449 $ 13,101 $ 8,245 |
Condensed Statements of Cash Flows | COMMUNITY WEST BANCSHARES Condensed Statements of Cash Flows December 31, 2022 2021 2020 (in thousands) Cash Flows from Operating Activities: Net income $ 13,449 $ 13,101 $ 8,245 Adjustments to reconcile net income to cash provided by operating activities: Equity in undistributed income from subsidiary (13,779 ) (13,271 ) (8,826 ) Stock-based compensation 289 318 319 Changes in: Other assets (221 ) 41 (1 ) Other liabilities 15 (215 ) (185 ) Net cash used in operating activities (247 ) (26 ) (448 ) Cash Flows from Investing Activities: Net dividends from and investment in subsidiary 1,375 1,600 1,197 Net cash provided by investing activities 1,375 1,600 1,197 Cash Flows from Financing Activities: Common stock dividends paid (2,574 ) (2,312 ) (1,652 ) Proceeds from issuance of common stock 974 1,204 4 Net cash used in financing activities (1,600 ) (1,108 ) (1,648 ) Net (decrease) increase in cash and cash equivalents (472 ) 466 (899 ) Cash and cash equivalents at beginning of year 539 73 972 Cash and cash equivalents at end of year $ 67 $ 539 $ 73 |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Concentrations of Lending Activities (Details) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Commercial Real Estate [Member] | ||
Concentrations of Lending Activities [Abstract] | ||
Loans secured by first liens, average loan to value ratio | 50.40% | 53.70% |
Commercial Real Estate [Member] | Owner Occupied [Member] | ||
Concentrations of Lending Activities [Abstract] | ||
Percentage of Commercial Real Estate loans | 24.50% | 27.80% |
Loans Receivable, Total [Member] | Credit Concentration Risk [Member] | Manufactured Housing [Member] | ||
Concentrations of Lending Activities [Abstract] | ||
Concentration risk, percentage | 33.10% | 33.30% |
Loans Receivable, Total [Member] | Credit Concentration Risk [Member] | Commercial Real Estate [Member] | ||
Concentrations of Lending Activities [Abstract] | ||
Concentration risk, percentage | 57.10% | 53.90% |
SUMMARY OF SIGNIFICANT ACCOUN_5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Business Segments (Details) - Segment | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Business Segments [Abstract] | |||
Number of reportable segments | 1 | 1 | 1 |
SUMMARY OF SIGNIFICANT ACCOUN_6
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Cash Reserve Requirement (Details) | Mar. 26, 2020 |
Cash Reserve Requirement [Abstract] | |
Ratio of cash reserve required | 0% |
SUMMARY OF SIGNIFICANT ACCOUN_7
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Federal Home Loan Bank ("FHLB") and Federal Reserve Bank ("FRB") Stock (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Federal Home Loan Bank ("FHLB") and Federal Reserve Bank ("FRB") Stock [Abstract] | ||
Impairment charge on equity securities with no actively traded market | $ 0 | $ 0 |
SUMMARY OF SIGNIFICANT ACCOUN_8
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Loans Held for Investment and Interest and Fees from Loans (Details) | 12 Months Ended |
Dec. 31, 2022 | |
Loans Held for Investment and Interest and Fees from Loans [Abstract] | |
Period of delinquency after which a loan is placed in a nonaccrual status | 90 days |
Minimum [Member] | |
Loans Held for Investment and Interest and Fees from Loans [Abstract] | |
Period of delinquency after which a loan is placed in a nonaccrual status | 90 days |
Other Personal Loans [Member] | Maximum [Member] | |
Loans Held for Investment and Interest and Fees from Loans [Abstract] | |
Threshold period past due for write-off of loans | 120 days |
SUMMARY OF SIGNIFICANT ACCOUN_9
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Allowance for Loan Losses (Details) | 12 Months Ended |
Dec. 31, 2022 Payment | |
Substantially Risk Free [Member] | |
Allowance for Loan Losses and Provision for Loan Losses [Abstract] | |
Percentage of cash collateral ratio of borrowed principal | 115% |
Commercial [Member] | |
Allowance for Loan Losses and Provision for Loan Losses [Abstract] | |
Period past due for unsecured loans to be charged off | 90 days |
Commercial Real Estate [Member] | |
Allowance for Loan Losses and Provision for Loan Losses [Abstract] | |
Period past due for unsecured loans to be charged off | 90 days |
SBA [Member] | |
Allowance for Loan Losses and Provision for Loan Losses [Abstract] | |
Period past due for unsecured loans to be charged off | 90 days |
Consumer [Member] | |
Allowance for Loan Losses and Provision for Loan Losses [Abstract] | |
Period past due for unsecured loans to be charged off | 120 days |
Number of delinquent payments for unsecured loans to be charged off | 5 |
Single Family Real Estate [Member] | |
Allowance for Loan Losses and Provision for Loan Losses [Abstract] | |
Period past due after which loans are evaluated for impairment | 90 days |
HELOC [Member] | |
Allowance for Loan Losses and Provision for Loan Losses [Abstract] | |
Period past due after which loans are evaluated for impairment | 90 days |
Manufactured Housing [Member] | |
Allowance for Loan Losses and Provision for Loan Losses [Abstract] | |
Period past due after which loans are evaluated for impairment | 90 days |
SUMMARY OF SIGNIFICANT ACCOU_10
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Premises and Equipment (Details) | 12 Months Ended |
Dec. 31, 2022 | |
Building Improvements [Member] | Minimum [Member] | |
Premises and Equipment [Abstract] | |
Estimated useful life of assets | 20 years |
Building Improvements [Member] | Maximum [Member] | |
Premises and Equipment [Abstract] | |
Estimated useful life of assets | 30 years |
Building and Improvements [Member] | Minimum [Member] | |
Premises and Equipment [Abstract] | |
Estimated useful life of assets | 20 years |
Building and Improvements [Member] | Maximum [Member] | |
Premises and Equipment [Abstract] | |
Estimated useful life of assets | 30 years |
Furniture and Equipment [Member] | Minimum [Member] | |
Premises and Equipment [Abstract] | |
Estimated useful life of assets | 5 years |
Furniture and Equipment [Member] | Maximum [Member] | |
Premises and Equipment [Abstract] | |
Estimated useful life of assets | 10 years |
Electronic Equipment and Software [Member] | Minimum [Member] | |
Premises and Equipment [Abstract] | |
Estimated useful life of assets | 3 years |
Electronic Equipment and Software [Member] | Maximum [Member] | |
Premises and Equipment [Abstract] | |
Estimated useful life of assets | 5 years |
SUMMARY OF SIGNIFICANT ACCOU_11
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Servicing Assets (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Change in Level 3 Assets Measured at Fair Value on a Recurring Basis [Roll Forward] | |||
Balance, beginning of period | $ 44,000 | $ 43,000 | $ 40,000 |
Additions | 0 | 0 | 0 |
Amortization, net | 0 | 0 | 0 |
Valuation adjustment | (18,000) | 1,000 | 3,000 |
Balance, end of period | 26,000 | 44,000 | 43,000 |
Servicing Assets Measured Under the Amortization Method [Roll Forward] | |||
Valuation adjustment | 120,000 | (139,000) | (615,000) |
SBA Servicing Assets [Member] | |||
Servicing Assets Measured Under the Amortization Method [Roll Forward] | |||
Balance, beginning of period | 0 | 27,000 | 41,000 |
Additions | 0 | 0 | 0 |
Amortization, net | 0 | (6,000) | (14,000) |
Valuation adjustment | 0 | (21,000) | 0 |
Balance, end of period | 0 | 0 | 27,000 |
Farmer Mac Servicing Assets [Member] | |||
Servicing Assets Measured Under the Amortization Method [Roll Forward] | |||
Balance, beginning of period | 1,556,000 | 1,391,000 | 765,000 |
Additions | 257,000 | 475,000 | 920,000 |
Amortization, net | (359,000) | (310,000) | (294,000) |
Valuation adjustment | 0 | 0 | 0 |
Balance, end of period | $ 1,454,000 | $ 1,556,000 | $ 1,391,000 |
Estimated life | 7 years |
SUMMARY OF SIGNIFICANT ACCOU_12
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Bank Owned Life Insurance (Details) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 |
Bank Owned Life Insurance [Abstract] | ||
Cash surrender value of life insurance | $ 8.7 | $ 9.8 |
SUMMARY OF SIGNIFICANT ACCOU_13
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Earnings Per Share [Abstract] | |||
Net income available to common stockholders | $ 13,449 | $ 13,101 | $ 8,245 |
Weighted average number of common shares outstanding - basic (in shares) | 8,722,481 | 8,567,839 | 8,472,709 |
Add: Dilutive effects of assumed exercises of stock options (in shares) | 169,646 | 155,099 | 70,120 |
Weighted average number of common shares outstanding - diluted (in shares) | 8,892,127 | 8,722,938 | 8,542,829 |
Earnings per share [Abstract] | |||
Basic (in dollars per share) | $ 1.54 | $ 1.53 | $ 0.97 |
Diluted (in dollars per share) | $ 1.51 | $ 1.5 | $ 0.97 |
Stock Options [Member] | |||
Antidilutive Securities [Abstract] | |||
Antidilutive stock not considered in computing diluted earnings per common share (in shares) | 95,304 | 101,010 | 391,064 |
SUMMARY OF SIGNIFICANT ACCOU_14
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Recent Accounting Pronouncements (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2021 | |
ASU 2016-13 [Member] | Forecast [Member] | ||
Recent Accounting Pronouncements - Not Yet Adopted [Abstract] | ||
Increase in reserve for unfunded commitments | $ 500 | |
ASU 2016-13 [Member] | Forecast [Member] | Minimum [Member] | ||
Recent Accounting Pronouncements - Not Yet Adopted [Abstract] | ||
Increase in allowance for credit losses | 1,700 | |
ASU 2016-13 [Member] | Forecast [Member] | Maximum [Member] | ||
Recent Accounting Pronouncements - Not Yet Adopted [Abstract] | ||
Increase in allowance for credit losses | $ 1,900 | |
ASU 2020-04 [Member] | LIBOR [Member] | ||
Recent Accounting Pronouncements - Not Yet Adopted [Abstract] | ||
Securities | $ 4,200 |
INVESTMENT SECURITIES, Securiti
INVESTMENT SECURITIES, Securities Available-for-Sale (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Securities available-for-sale [Abstract] | ||
Amortized cost | $ 27,790 | $ 19,588 |
Gross unrealized gains | 26 | 165 |
Gross unrealized (losses) | (1,128) | (42) |
Fair value | 26,688 | 19,711 |
U.S. Government Agency Notes [Member] | ||
Securities available-for-sale [Abstract] | ||
Amortized cost | 4,081 | 5,476 |
Gross unrealized gains | 26 | 32 |
Gross unrealized (losses) | 0 | 0 |
Fair value | 4,107 | 5,508 |
U.S. Government Agency Collateralized Mortgage Obligations ("CMO") [Member] | ||
Securities available-for-sale [Abstract] | ||
Amortized cost | 4,475 | 4,862 |
Gross unrealized gains | 0 | 31 |
Gross unrealized (losses) | (179) | (10) |
Fair value | 4,296 | 4,883 |
U.S. Treasury Securities [Member] | ||
Securities available-for-sale [Abstract] | ||
Amortized cost | 9,984 | |
Gross unrealized gains | 0 | |
Gross unrealized (losses) | (14) | |
Fair value | 9,970 | |
Corporate Debt Securities [Member] | ||
Securities available-for-sale [Abstract] | ||
Amortized cost | 9,250 | 9,250 |
Gross unrealized gains | 0 | 102 |
Gross unrealized (losses) | (935) | (32) |
Fair value | $ 8,315 | $ 9,320 |
INVESTMENT SECURITIES, Securi_2
INVESTMENT SECURITIES, Securities Held-to-Maturity (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Securities held-to-maturity [Abstract] | ||
Amortized cost | $ 2,557 | $ 2,815 |
Gross unrealized gains | 3 | 159 |
Gross unrealized (losses) | (137) | 0 |
Fair value | 2,423 | 2,974 |
U.S. Government Agency Mortgage-Backed Securities ("MBS") [Member] | ||
Securities held-to-maturity [Abstract] | ||
Amortized cost | 2,557 | 2,815 |
Gross unrealized gains | 3 | 159 |
Gross unrealized (losses) | (137) | 0 |
Fair value | $ 2,423 | $ 2,974 |
INVESTMENT SECURITIES, Securi_3
INVESTMENT SECURITIES, Securities Measured at Fair Value (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Securities measured at fair value [Abstract] | ||
Amortized cost | $ 66 | $ 66 |
Gross unrealized gains | 159 | 182 |
Gross unrealized (losses) | 0 | 0 |
Fair value | 225 | 248 |
Equity Securities: Farmer Mac Class A Stock [Member] | ||
Securities measured at fair value [Abstract] | ||
Amortized cost | 66 | 66 |
Gross unrealized gains | 159 | 182 |
Gross unrealized losses | 0 | 0 |
Fair value | $ 225 | $ 248 |
INVESTMENT SECURITIES, Securi_4
INVESTMENT SECURITIES, Securities Pledged as Collateral (Details) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 |
INVESTMENT SECURITIES [Abstract] | ||
Securities pledged as collateral to the Federal Home Loan Bank ("FHLB") | $ 21.1 | $ 13.2 |
INVESTMENT SECURITIES, Maturity
INVESTMENT SECURITIES, Maturity Periods and Weighted Average Yields (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Maturity periods and weighted average yields of investment securities available-for-sale [Abstract] | ||
Less than one year, amount | $ 9,970 | $ 0 |
Less than one year, yield | 2.06% | 0% |
One to five years, amount | $ 0 | $ 13,886 |
One to five years, yield | 0% | 2.68% |
Five to ten years, amount | $ 8,834 | $ 5,825 |
Five to ten years, yield | 3.73% | 1.21% |
Over ten years, amount | $ 7,884 | $ 0 |
Over ten years, yield | 4.53% | 0% |
Total amount | $ 26,688 | $ 19,711 |
Total yield | 3.34% | 2.25% |
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 | 0% | 0% |
One to five years, amount | $ 0 | $ 2,065 |
One to five years, yield | 0% | 2.87% |
Five to ten years, amount | $ 746 | $ 750 |
Five to ten years, yield | 3.60% | 3.58% |
Over ten years, amount | $ 1,811 | $ 0 |
Over ten years, yield | 3.68% | 0% |
Total amount | $ 2,557 | $ 2,815 |
Total yield | 3.66% | 3.06% |
U.S. Government Agency Notes [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 | 0% | 0% |
One to five years, amount | $ 0 | $ 661 |
One to five years, yield | 0% | 0.59% |
Five to ten years, amount | $ 519 | $ 4,847 |
Five to ten years, yield | 3.59% | 1.30% |
Over ten years, amount | $ 3,588 | $ 0 |
Over ten years, yield | 4.40% | 0% |
Total amount | $ 4,107 | $ 5,508 |
Total yield | 4.30% | 1.21% |
U.S. Government Agency CMO [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 | 0% | 0% |
One to five years, amount | $ 0 | $ 3,905 |
One to five years, yield | 0% | 0.50% |
Five to ten years, amount | $ 0 | $ 978 |
Five to ten years, yield | 0% | 0.77% |
Over ten years, amount | $ 4,296 | $ 0 |
Over ten years, yield | 4.63% | 0% |
Total amount | $ 4,296 | $ 4,883 |
Total yield | 4.63% | 0.55% |
U.S. Treasury Securities [Member] | ||
Maturity periods and weighted average yields of investment securities available-for-sale [Abstract] | ||
Less than one year, amount | $ 9,970 | |
Less than one year, yield | 2.06% | |
One to five years, amount | $ 0 | |
One to five years, yield | 0% | |
Five to ten years, amount | $ 0 | |
Five to ten years, yield | 0% | |
Over ten years, amount | $ 0 | |
Over ten years, yield | 0% | |
Total amount | $ 9,970 | |
Total yield | 2.06% | |
Corporate Debt Securities [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 | 0% | 0% |
One to five years, amount | $ 0 | $ 9,320 |
One to five years, yield | 0% | 3.74% |
Five to ten years, amount | $ 8,315 | $ 0 |
Five to ten years, yield | 3.74% | 0% |
Over ten years, amount | $ 0 | $ 0 |
Over ten years, yield | 0% | 0% |
Total amount | $ 8,315 | $ 9,320 |
Total yield | 3.74% | 3.74% |
U.S. Government Agency 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 | 0% | 0% |
One to five years, amount | $ 0 | $ 2,065 |
One to five years, yield | 0% | 2.87% |
Five to ten years, amount | $ 746 | $ 750 |
Five to ten years, yield | 3.60% | 3.58% |
Over ten years, amount | $ 1,811 | $ 0 |
Over ten years, yield | 3.68% | 0% |
Total amount | $ 2,557 | $ 2,815 |
Total yield | 3.66% | 3.06% |
INVESTMENT SECURITIES, Investme
INVESTMENT SECURITIES, Investment Securities by Contractual Maturities (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Securities available-for-sale, Amortized Cost [Abstract] | ||
Due in less than one year | $ 9,984 | $ 0 |
After one year through five years | 0 | 13,786 |
After five years through ten years | 9,768 | 5,802 |
After ten years | 8,038 | 0 |
Amortized cost | 27,790 | 19,588 |
Securities available for sale, Estimated Fair Value [Abstract] | ||
Due in one year or less | 9,970 | 0 |
After one year through five years | 0 | 13,886 |
After five years through ten years | 8,834 | 5,825 |
After ten years | 7,884 | 0 |
Estimated fair value | 26,688 | 19,711 |
Securities held to maturity, Amortized Cost [Abstract] | ||
Due in less than one year | 0 | 0 |
After one year through five years | 0 | 2,065 |
After five years through ten years | 746 | 750 |
After ten years | 1,811 | 0 |
Amortized cost | 2,557 | 2,815 |
Securities held to maturity, Estimated Fair Value [Abstract] | ||
Due in less than one year | 0 | 0 |
After one year through five years | 0 | 2,137 |
After five years through ten years | 705 | 837 |
After ten years | 1,718 | 0 |
Estimated fair value | $ 2,423 | $ 2,974 |
INVESTMENT SECURITIES, Unrealiz
INVESTMENT SECURITIES, Unrealized Loss Positions (Details) $ in Thousands | Dec. 31, 2022 USD ($) Security | Dec. 31, 2021 USD ($) Security |
Securities available-for-sale, continuous unrealized loss position [Abstract] | ||
Less than twelve months, gross unrealized losses | $ (908) | $ (32) |
More than twelve months, gross unrealized losses | (220) | (10) |
Total, gross unrealized losses | (1,128) | (42) |
Less than twelve months, fair value | 20,646 | 2,968 |
More than twelve months, fair value | 1,935 | 977 |
Total, fair value | 22,581 | $ 3,945 |
Securities held-to-maturity, continuous unrealized loss position [Abstract] | ||
Less than twelve months, gross unrealized losses | (137) | |
More than twelve months, gross unrealized losses | 0 | |
Total, gross unrealized losses | (137) | |
Less than twelve months, fair value | 2,115 | |
More than twelve months, fair value | 0 | |
Total, fair value | $ 2,115 | |
Securities in unrealized loss positions | Security | 37 | 4 |
U.S. Government Agency Notes [Member] | ||
Securities available-for-sale, continuous unrealized loss position [Abstract] | ||
Less than twelve months, gross unrealized losses | $ 0 | |
More than twelve months, gross unrealized losses | 0 | |
Total, gross unrealized losses | 0 | |
Less than twelve months, fair value | 0 | |
More than twelve months, fair value | 0 | |
Total, fair value | 0 | |
U.S. Government Agency CMO [Member] | ||
Securities available-for-sale, continuous unrealized loss position [Abstract] | ||
Less than twelve months, gross unrealized losses | $ (130) | 0 |
More than twelve months, gross unrealized losses | (49) | (10) |
Total, gross unrealized losses | (179) | (10) |
Less than twelve months, fair value | 3,690 | 0 |
More than twelve months, fair value | 606 | 977 |
Total, fair value | 4,296 | 977 |
U.S. Treasury Securities [Member] | ||
Securities available-for-sale, continuous unrealized loss position [Abstract] | ||
Less than twelve months, gross unrealized losses | (14) | |
More than twelve months, gross unrealized losses | 0 | |
Total, gross unrealized losses | (14) | |
Less than twelve months, fair value | 9,970 | |
More than twelve months, fair value | 0 | |
Total, fair value | 9,970 | |
Corporate Debt Securities [Member] | ||
Securities available-for-sale, continuous unrealized loss position [Abstract] | ||
Less than twelve months, gross unrealized losses | (764) | (32) |
More than twelve months, gross unrealized losses | (171) | 0 |
Total, gross unrealized losses | (935) | (32) |
Less than twelve months, fair value | 6,986 | 2,968 |
More than twelve months, fair value | 1,329 | 0 |
Total, fair value | 8,315 | $ 2,968 |
U.S. Government Agency MBS [Member] | ||
Securities held-to-maturity, continuous unrealized loss position [Abstract] | ||
Less than twelve months, gross unrealized losses | (137) | |
More than twelve months, gross unrealized losses | 0 | |
Total, gross unrealized losses | (137) | |
Less than twelve months, fair value | 2,115 | |
More than twelve months, fair value | 0 | |
Total, fair value | $ 2,115 |
LOANS HELD FOR SALE AND LOANS_3
LOANS HELD FOR SALE AND LOANS SERVICED FOR OTHERS (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Loans Held for Sale [Abstract] | ||
Loans included in loans held for sale | $ 21,033 | $ 23,408 |
Loans serviced for others | 158,183 | 146,131 |
Farmer Mac [Member] | ||
Loans Held for Sale [Abstract] | ||
Loans serviced for others | 155,522 | 142,677 |
SBA [Member] | ||
Loans Held for Sale [Abstract] | ||
Loans included in loans held for sale | 5,200 | 6,300 |
Loans serviced for others | 1,926 | 2,709 |
USDA, FSA, and USDA Business and Industry [Member] | ||
Loans Held for Sale [Abstract] | ||
Loans serviced for others | 735 | 745 |
USDA [Member] | ||
Loans Held for Sale [Abstract] | ||
Loans included in loans held for sale | $ 15,900 | $ 17,100 |
LOANS HELD FOR INVESTMENT, Comp
LOANS HELD FOR INVESTMENT, Composition of Loans Held for Investment Portfolio (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Loans held for investment [Abstract] | ||||
Gross loans held for investment | $ 935,123 | $ 869,547 | ||
Deferred fees, net | (787) | (838) | ||
Discount on SBA loans | (27) | (34) | ||
Loans held for investment | 934,309 | 868,675 | ||
Allowance for loan losses | (10,765) | (10,404) | $ (10,194) | $ (8,717) |
Total loans held for investment, net | 923,544 | 858,271 | ||
Manufactured Housing [Member] | ||||
Loans held for investment [Abstract] | ||||
Gross loans held for investment | 315,825 | 297,363 | ||
Allowance for loan losses | (3,879) | (2,606) | (2,612) | (2,184) |
Commercial Real Estate [Member] | ||||
Loans held for investment [Abstract] | ||||
Gross loans held for investment | 545,317 | 480,801 | ||
Allowance for loan losses | (5,980) | (6,729) | (5,950) | (5,217) |
Commercial [Member] | ||||
Loans held for investment [Abstract] | ||||
Gross loans held for investment | 59,070 | 55,287 | ||
Allowance for loan losses | (747) | (923) | (1,379) | (1,162) |
SBA [Member] | ||||
Loans held for investment [Abstract] | ||||
Gross loans held for investment | 3,482 | 23,659 | ||
Allowance for loan losses | (21) | (22) | (118) | (32) |
HELOC [Member] | ||||
Loans held for investment [Abstract] | ||||
Gross loans held for investment | 2,613 | 3,579 | ||
Allowance for loan losses | (27) | (18) | (25) | (27) |
Single Family Real Estate [Member] | ||||
Loans held for investment [Abstract] | ||||
Gross loans held for investment | 8,709 | 8,749 | ||
Allowance for loan losses | (107) | (105) | (108) | (92) |
Consumer [Member] | ||||
Loans held for investment [Abstract] | ||||
Gross loans held for investment | 107 | 109 | ||
Allowance for loan losses | $ (4) | $ (1) | $ (2) | $ (3) |
LOANS HELD FOR INVESTMENT, Fina
LOANS HELD FOR INVESTMENT, Financing Receivables Past Due (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | $ 935,123 | $ 869,547 | |
Nonaccrual | 211 | 565 | |
Recorded investment over 90 days and accruing | $ 0 | 0 | |
Period past due after which accrual of interest is discontinued | 90 days | ||
Foregone interest on nonaccrual and troubled debt restructured loans | $ 38 | 154 | $ 255 |
Period past due after which guaranteed portion of SBA loan is repurchased from investors | 120 days | ||
Loans Guaranteed by Government Agencies [Member] | |||
Aging of loans held for investment [Abstract] | |||
Nonaccrual | $ 0 | 314 | |
Current [Member] | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 932,032 | 868,278 | |
Total Past Due [Member] | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 2,880 | 704 | |
30 to 59 Days Past Due [Member] | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 2,778 | 565 | |
60 to 89 Days Past Due [Member] | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 102 | 139 | |
Over 90 Days Past Due | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 0 | 0 | |
Manufactured Housing [Member] | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 315,825 | 297,363 | |
Nonaccrual | 61 | 306 | |
Recorded investment over 90 days and accruing | 0 | 0 | |
Manufactured Housing [Member] | Current [Member] | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 314,997 | 296,715 | |
Manufactured Housing [Member] | Total Past Due [Member] | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 767 | 342 | |
Manufactured Housing [Member] | 30 to 59 Days Past Due [Member] | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 665 | 342 | |
Manufactured Housing [Member] | 60 to 89 Days Past Due [Member] | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 102 | 0 | |
Manufactured Housing [Member] | Over 90 Days Past Due | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 0 | 0 | |
Commercial Real Estate [Member] | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 545,317 | 480,801 | |
Commercial Real Estate [Member] | Commercial Real Estate [Member] | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 482,759 | 431,062 | |
Nonaccrual | 0 | 0 | |
Recorded investment over 90 days and accruing | 0 | 0 | |
Commercial Real Estate [Member] | Commercial Real Estate [Member] | Current [Member] | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 481,599 | 431,062 | |
Commercial Real Estate [Member] | Commercial Real Estate [Member] | Total Past Due [Member] | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 1,160 | 0 | |
Commercial Real Estate [Member] | Commercial Real Estate [Member] | 30 to 59 Days Past Due [Member] | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 1,160 | 0 | |
Commercial Real Estate [Member] | Commercial Real Estate [Member] | 60 to 89 Days Past Due [Member] | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 0 | 0 | |
Commercial Real Estate [Member] | Commercial Real Estate [Member] | Over 90 Days Past Due | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 0 | 0 | |
Commercial Real Estate [Member] | SBA 504 1st Trust Deed [Member] | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 12,947 | 16,961 | |
Nonaccrual | 0 | 0 | |
Recorded investment over 90 days and accruing | 0 | 0 | |
Commercial Real Estate [Member] | SBA 504 1st Trust Deed [Member] | Current [Member] | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 12,947 | 16,961 | |
Commercial Real Estate [Member] | SBA 504 1st Trust Deed [Member] | Total Past Due [Member] | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 0 | 0 | |
Commercial Real Estate [Member] | SBA 504 1st Trust Deed [Member] | 30 to 59 Days Past Due [Member] | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 0 | 0 | |
Commercial Real Estate [Member] | SBA 504 1st Trust Deed [Member] | 60 to 89 Days Past Due [Member] | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 0 | 0 | |
Commercial Real Estate [Member] | SBA 504 1st Trust Deed [Member] | Over 90 Days Past Due | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 0 | 0 | |
Commercial Real Estate [Member] | Land [Member] | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 11,237 | 7,185 | |
Nonaccrual | 0 | 0 | |
Recorded investment over 90 days and accruing | 0 | 0 | |
Commercial Real Estate [Member] | Land [Member] | Current [Member] | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 11,237 | 7,185 | |
Commercial Real Estate [Member] | Land [Member] | Total Past Due [Member] | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 0 | 0 | |
Commercial Real Estate [Member] | Land [Member] | 30 to 59 Days Past Due [Member] | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 0 | 0 | |
Commercial Real Estate [Member] | Land [Member] | 60 to 89 Days Past Due [Member] | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 0 | 0 | |
Commercial Real Estate [Member] | Land [Member] | Over 90 Days Past Due | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 0 | 0 | |
Commercial Real Estate [Member] | Construction [Member] | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 38,374 | 25,593 | |
Nonaccrual | 0 | 0 | |
Recorded investment over 90 days and accruing | 0 | 0 | |
Commercial Real Estate [Member] | Construction [Member] | Current [Member] | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 38,374 | 25,593 | |
Commercial Real Estate [Member] | Construction [Member] | Total Past Due [Member] | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 0 | 0 | |
Commercial Real Estate [Member] | Construction [Member] | 30 to 59 Days Past Due [Member] | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 0 | 0 | |
Commercial Real Estate [Member] | Construction [Member] | 60 to 89 Days Past Due [Member] | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 0 | 0 | |
Commercial Real Estate [Member] | Construction [Member] | Over 90 Days Past Due | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 0 | 0 | |
Commercial [Member] | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 59,070 | 55,287 | |
Nonaccrual | 0 | 0 | |
Recorded investment over 90 days and accruing | 0 | 0 | |
Commercial [Member] | Current [Member] | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 59,070 | 55,287 | |
Commercial [Member] | Total Past Due [Member] | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 0 | 0 | |
Commercial [Member] | 30 to 59 Days Past Due [Member] | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 0 | 0 | |
Commercial [Member] | 60 to 89 Days Past Due [Member] | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 0 | 0 | |
Commercial [Member] | Over 90 Days Past Due | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 0 | 0 | |
SBA [Member] | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 3,482 | 23,659 | |
Nonaccrual | 0 | 1 | |
Recorded investment over 90 days and accruing | 0 | 0 | |
SBA [Member] | Current [Member] | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 2,529 | 23,296 | |
SBA [Member] | Total Past Due [Member] | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 953 | 362 | |
SBA [Member] | 30 to 59 Days Past Due [Member] | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 953 | 223 | |
SBA [Member] | 60 to 89 Days Past Due [Member] | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 0 | 139 | |
SBA [Member] | Over 90 Days Past Due | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 0 | 0 | |
HELOC [Member] | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 2,613 | 3,579 | |
Nonaccrual | 0 | 0 | |
Recorded investment over 90 days and accruing | 0 | 0 | |
HELOC [Member] | Current [Member] | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 2,613 | 3,579 | |
HELOC [Member] | Total Past Due [Member] | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 0 | 0 | |
HELOC [Member] | 30 to 59 Days Past Due [Member] | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 0 | 0 | |
HELOC [Member] | 60 to 89 Days Past Due [Member] | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 0 | 0 | |
HELOC [Member] | Over 90 Days Past Due | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 0 | 0 | |
Single Family Real Estate [Member] | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 8,709 | 8,749 | |
Nonaccrual | 150 | 258 | |
Recorded investment over 90 days and accruing | 0 | 0 | |
Single Family Real Estate [Member] | Current [Member] | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 8,559 | 8,491 | |
Single Family Real Estate [Member] | Total Past Due [Member] | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 0 | 0 | |
Single Family Real Estate [Member] | 30 to 59 Days Past Due [Member] | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 0 | 0 | |
Single Family Real Estate [Member] | 60 to 89 Days Past Due [Member] | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 0 | 0 | |
Single Family Real Estate [Member] | Over 90 Days Past Due | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 0 | 0 | |
Consumer [Member] | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 107 | 109 | |
Nonaccrual | 0 | 0 | |
Recorded investment over 90 days and accruing | 0 | 0 | |
Consumer [Member] | Current [Member] | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 107 | 109 | |
Consumer [Member] | Total Past Due [Member] | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 0 | 0 | |
Consumer [Member] | 30 to 59 Days Past Due [Member] | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 0 | 0 | |
Consumer [Member] | 60 to 89 Days Past Due [Member] | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | 0 | 0 | |
Consumer [Member] | Over 90 Days Past Due | |||
Aging of loans held for investment [Abstract] | |||
Total loans held for investment | $ 0 | $ 0 |
LOANS HELD FOR INVESTMENT, Allo
LOANS HELD FOR INVESTMENT, Allowance for Losses by Portfolio Type (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Summary of allowance for loan losses [Roll Forward] | |||
Beginning balance | $ 10,404 | $ 10,194 | $ 8,717 |
Charge-offs | (182) | (1) | 0 |
Recoveries | 738 | 392 | 254 |
Net (charge-offs) recoveries | 556 | 391 | 254 |
Provision (credit) for loan losses | (195) | (181) | 1,223 |
Ending balance | 10,765 | 10,404 | 10,194 |
Manufactured Housing [Member] | |||
Summary of allowance for loan losses [Roll Forward] | |||
Beginning balance | 2,606 | 2,612 | 2,184 |
Charge-offs | 0 | 0 | 0 |
Recoveries | 139 | 218 | 27 |
Net (charge-offs) recoveries | 139 | 218 | 27 |
Provision (credit) for loan losses | 1,134 | (224) | 401 |
Ending balance | 3,879 | 2,606 | 2,612 |
Commercial Real Estate [Member] | |||
Summary of allowance for loan losses [Roll Forward] | |||
Beginning balance | 6,729 | 5,950 | 5,217 |
Charge-offs | 0 | 0 | 0 |
Recoveries | 80 | 80 | 80 |
Net (charge-offs) recoveries | 80 | 80 | 80 |
Provision (credit) for loan losses | (829) | 699 | 653 |
Ending balance | 5,980 | 6,729 | 5,950 |
Commercial [Member] | |||
Summary of allowance for loan losses [Roll Forward] | |||
Beginning balance | 923 | 1,379 | 1,162 |
Charge-offs | 0 | 0 | 0 |
Recoveries | 190 | 40 | 133 |
Net (charge-offs) recoveries | 190 | 40 | 133 |
Provision (credit) for loan losses | (366) | (496) | 84 |
Ending balance | 747 | 923 | 1,379 |
SBA [Member] | |||
Summary of allowance for loan losses [Roll Forward] | |||
Beginning balance | 22 | 118 | 32 |
Charge-offs | (182) | 0 | 0 |
Recoveries | 316 | 47 | 7 |
Net (charge-offs) recoveries | 134 | 47 | 7 |
Provision (credit) for loan losses | (135) | (143) | 79 |
Ending balance | 21 | 22 | 118 |
HELOC [Member] | |||
Summary of allowance for loan losses [Roll Forward] | |||
Beginning balance | 18 | 25 | 27 |
Charge-offs | 0 | 0 | 0 |
Recoveries | 12 | 6 | 6 |
Net (charge-offs) recoveries | 12 | 6 | 6 |
Provision (credit) for loan losses | (3) | (13) | (8) |
Ending balance | 27 | 18 | 25 |
Single Family Real Estate [Member] | |||
Summary of allowance for loan losses [Roll Forward] | |||
Beginning balance | 105 | 108 | 92 |
Charge-offs | 0 | 0 | 0 |
Recoveries | 0 | 1 | 1 |
Net (charge-offs) recoveries | 0 | 1 | 1 |
Provision (credit) for loan losses | 2 | (4) | 15 |
Ending balance | 107 | 105 | 108 |
Consumer [Member] | |||
Summary of allowance for loan losses [Roll Forward] | |||
Beginning balance | 1 | 2 | 3 |
Charge-offs | 0 | (1) | 0 |
Recoveries | 1 | 0 | 0 |
Net (charge-offs) recoveries | 1 | (1) | 0 |
Provision (credit) for loan losses | 2 | 0 | (1) |
Ending balance | $ 4 | $ 1 | $ 2 |
LOANS HELD FOR INVESTMENT, Impa
LOANS HELD FOR INVESTMENT, Impaired Financing Receivables (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Recorded Investment [Abstract] | ||||
Impaired loans with an allowance recorded | $ 3,443 | $ 4,487 | ||
Impaired loans with no allowance recorded | 2,614 | 4,749 | ||
Total loans individually evaluated for impairment | 6,057 | 9,236 | ||
Loans collectively evaluated for impairment | 929,066 | 860,311 | ||
Total loans held for investment | 935,123 | 869,547 | ||
Unpaid Principal Balance [Abstract] | ||||
Impaired loans with an allowance recorded | 3,443 | 4,745 | ||
Impaired loans with no allowance recorded | 2,614 | 4,491 | ||
Total loans individually evaluated for impairment | 6,057 | 9,236 | ||
Loans collectively evaluated for impairment | 929,066 | 860,311 | ||
Total loans held for investment | 935,123 | 869,547 | ||
Related Allowance for Loan Losses [Abstract] | ||||
Impaired loans with an allowance recorded | 184 | 240 | ||
Impaired loans with no allowance recorded | 0 | 0 | ||
Total loans individually evaluated for impairment | 184 | 240 | ||
Loans collectively evaluated for impairment | 10,581 | 10,164 | ||
Total loans held for investment | 10,765 | 10,404 | $ 10,194 | $ 8,717 |
Loans Guaranteed by Government Agencies [Member] | ||||
Related Allowance for Loan Losses [Abstract] | ||||
Impaired loans | 0 | 300 | ||
Manufactured Housing [Member] | ||||
Recorded Investment [Abstract] | ||||
Impaired loans with an allowance recorded | 2,918 | 3,563 | ||
Impaired loans with no allowance recorded | 1,166 | 1,358 | ||
Total loans individually evaluated for impairment | 4,084 | 4,921 | ||
Loans collectively evaluated for impairment | 311,741 | 292,442 | ||
Total loans held for investment | 315,825 | 297,363 | ||
Unpaid Principal Balance [Abstract] | ||||
Impaired loans with an allowance recorded | 2,918 | 3,563 | ||
Impaired loans with no allowance recorded | 1,166 | 1,358 | ||
Total loans individually evaluated for impairment | 4,084 | 4,921 | ||
Loans collectively evaluated for impairment | 311,741 | 292,442 | ||
Total loans held for investment | 315,825 | 297,363 | ||
Related Allowance for Loan Losses [Abstract] | ||||
Impaired loans with an allowance recorded | 157 | 210 | ||
Impaired loans with no allowance recorded | 0 | 0 | ||
Total loans individually evaluated for impairment | 157 | 210 | ||
Loans collectively evaluated for impairment | 3,722 | 2,396 | ||
Total loans held for investment | 3,879 | 2,606 | 2,612 | 2,184 |
Commercial Real Estate [Member] | ||||
Recorded Investment [Abstract] | ||||
Impaired loans with an allowance recorded | 209 | 220 | ||
Impaired loans with no allowance recorded | 0 | 1,402 | ||
Total loans individually evaluated for impairment | 209 | 1,622 | ||
Loans collectively evaluated for impairment | 545,108 | 479,179 | ||
Total loans held for investment | 545,317 | 480,801 | ||
Unpaid Principal Balance [Abstract] | ||||
Impaired loans with an allowance recorded | 209 | 220 | ||
Impaired loans with no allowance recorded | 0 | 1,402 | ||
Total loans individually evaluated for impairment | 209 | 1,622 | ||
Loans collectively evaluated for impairment | 545,108 | 479,179 | ||
Total loans held for investment | 545,317 | 480,801 | ||
Related Allowance for Loan Losses [Abstract] | ||||
Impaired loans with an allowance recorded | 18 | 17 | ||
Impaired loans with no allowance recorded | 0 | 0 | ||
Total loans individually evaluated for impairment | 18 | 17 | ||
Loans collectively evaluated for impairment | 5,962 | 6,712 | ||
Total loans held for investment | 5,980 | 6,729 | 5,950 | 5,217 |
Commercial [Member] | ||||
Recorded Investment [Abstract] | ||||
Impaired loans with an allowance recorded | 67 | 85 | ||
Impaired loans with no allowance recorded | 1,297 | 1,505 | ||
Total loans individually evaluated for impairment | 1,364 | 1,590 | ||
Loans collectively evaluated for impairment | 57,706 | 53,697 | ||
Total loans held for investment | 59,070 | 55,287 | ||
Unpaid Principal Balance [Abstract] | ||||
Impaired loans with an allowance recorded | 67 | 85 | ||
Impaired loans with no allowance recorded | 1,297 | 1,505 | ||
Total loans individually evaluated for impairment | 1,364 | 1,590 | ||
Loans collectively evaluated for impairment | 57,706 | 53,697 | ||
Total loans held for investment | 59,070 | 55,287 | ||
Related Allowance for Loan Losses [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 | 747 | 923 | ||
Total loans held for investment | 747 | 923 | 1,379 | 1,162 |
SBA [Member] | ||||
Recorded Investment [Abstract] | ||||
Impaired loans with an allowance recorded | 41 | 194 | ||
Impaired loans with no allowance recorded | 0 | 226 | ||
Total loans individually evaluated for impairment | 41 | 420 | ||
Loans collectively evaluated for impairment | 3,441 | 23,239 | ||
Total loans held for investment | 3,482 | 23,659 | ||
Unpaid Principal Balance [Abstract] | ||||
Impaired loans with an allowance recorded | 41 | 194 | ||
Impaired loans with no allowance recorded | 0 | 226 | ||
Total loans individually evaluated for impairment | 41 | 420 | ||
Loans collectively evaluated for impairment | 3,441 | 23,239 | ||
Total loans held for investment | 3,482 | 23,659 | ||
Related Allowance for Loan Losses [Abstract] | ||||
Impaired loans with an allowance recorded | 1 | 1 | ||
Impaired loans with no allowance recorded | 0 | 0 | ||
Total loans individually evaluated for impairment | 1 | 1 | ||
Loans collectively evaluated for impairment | 20 | 21 | ||
Total loans held for investment | 21 | 22 | 118 | 32 |
HELOC [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 | 2,613 | 3,579 | ||
Total loans held for investment | 2,613 | 3,579 | ||
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 | 2,613 | 3,579 | ||
Total loans held for investment | 2,613 | 3,579 | ||
Related Allowance for Loan Losses [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 | 27 | 18 | ||
Total loans held for investment | 27 | 18 | 25 | 27 |
Single Family Real Estate [Member] | ||||
Recorded Investment [Abstract] | ||||
Impaired loans with an allowance recorded | 208 | 425 | ||
Impaired loans with no allowance recorded | 151 | 258 | ||
Total loans individually evaluated for impairment | 359 | 683 | ||
Loans collectively evaluated for impairment | 8,350 | 8,066 | ||
Total loans held for investment | 8,709 | 8,749 | ||
Unpaid Principal Balance [Abstract] | ||||
Impaired loans with an allowance recorded | 208 | 683 | ||
Impaired loans with no allowance recorded | 151 | 0 | ||
Total loans individually evaluated for impairment | 359 | 683 | ||
Loans collectively evaluated for impairment | 8,350 | 8,066 | ||
Total loans held for investment | 8,709 | 8,749 | ||
Related Allowance for Loan Losses [Abstract] | ||||
Impaired loans with an allowance recorded | 8 | 12 | ||
Impaired loans with no allowance recorded | 0 | 0 | ||
Total loans individually evaluated for impairment | 8 | 12 | ||
Loans collectively evaluated for impairment | 99 | 93 | ||
Total loans held for investment | 107 | 105 | 108 | 92 |
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 | 107 | 109 | ||
Total loans held for investment | 107 | 109 | ||
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 | 107 | 109 | ||
Total loans held for investment | 107 | 109 | ||
Related Allowance for Loan Losses [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 | 4 | 1 | ||
Total loans held for investment | $ 4 | $ 1 | $ 2 | $ 3 |
LOANS HELD FOR INVESTMENT, Aver
LOANS HELD FOR INVESTMENT, Average Investment in Impaired Loans by Class (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Average recorded investment and interest income recognized [Abstract] | |||
Average investment in impaired loans | $ 6,958 | $ 10,858 | $ 12,351 |
Interest income | 501 | 660 | 758 |
Manufactured Housing [Member] | |||
Average recorded investment and interest income recognized [Abstract] | |||
Average investment in impaired loans | 4,396 | 5,816 | 7,483 |
Interest income | 344 | 383 | 556 |
Commercial Real Estate [Member] | Commercial Real Estate [Member] | |||
Average recorded investment and interest income recognized [Abstract] | |||
Average investment in impaired loans | 0 | 0 | 67 |
Interest income | 0 | 0 | 0 |
Commercial Real Estate [Member] | SBA 504 1st Trust Deed [Member] | |||
Average recorded investment and interest income recognized [Abstract] | |||
Average investment in impaired loans | 446 | 1,509 | 527 |
Interest income | 16 | 116 | 71 |
Commercial Real Estate [Member] | Land [Member] | |||
Average recorded investment and interest income recognized [Abstract] | |||
Average investment in impaired loans | 0 | 0 | 0 |
Interest income | 0 | 0 | 0 |
Commercial Real Estate [Member] | Construction [Member] | |||
Average recorded investment and interest income recognized [Abstract] | |||
Average investment in impaired loans | 0 | 0 | 0 |
Interest income | 0 | 0 | 0 |
Commercial [Member] | |||
Average recorded investment and interest income recognized [Abstract] | |||
Average investment in impaired loans | 1,459 | 1,506 | 1,660 |
Interest income | 93 | 100 | 7 |
SBA [Member] | |||
Average recorded investment and interest income recognized [Abstract] | |||
Average investment in impaired loans | 134 | 421 | 335 |
Interest income | 23 | 27 | 1 |
HELOC [Member] | |||
Average recorded investment and interest income recognized [Abstract] | |||
Average investment in impaired loans | 0 | 0 | 0 |
Interest income | 0 | 0 | 0 |
Single Family Real Estate [Member] | |||
Average recorded investment and interest income recognized [Abstract] | |||
Average investment in impaired loans | 523 | 1,606 | 2,279 |
Interest income | 25 | 34 | 123 |
Consumer [Member] | |||
Average recorded investment and interest income recognized [Abstract] | |||
Average investment in impaired loans | 0 | 0 | 0 |
Interest income | $ 0 | $ 0 | $ 0 |
LOANS HELD FOR INVESTMENT, Gros
LOANS HELD FOR INVESTMENT, Gross Loans by Risk Rating (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | $ 935,123 | $ 869,547 |
Total loans held for investment, net | 930,790 | 843,976 |
Pass [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | 906,604 | 846,753 |
Total loans held for investment, net | 902,271 | 823,143 |
Special Mention [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | 16,104 | 3,069 |
Total loans held for investment, net | 16,104 | 3,069 |
Substandard [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | 12,415 | 19,725 |
Total loans held for investment, net | 12,415 | 17,764 |
Doubtful [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | 0 | 0 |
Total loans held for investment, net | 0 | 0 |
Loss [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | 0 | 0 |
Government Guaranteed Loans [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | 4,333 | 25,571 |
Government Guaranteed Loans [Member] | Pass [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | 4,333 | 23,610 |
Government Guaranteed Loans [Member] | Special Mention [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | 0 | 0 |
Government Guaranteed Loans [Member] | Substandard [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | 0 | 1,961 |
Government Guaranteed Loans [Member] | Doubtful [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | 0 | 0 |
Manufactured Housing [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | 315,825 | 297,363 |
Manufactured Housing [Member] | Pass [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | 314,771 | 295,810 |
Manufactured Housing [Member] | Special Mention [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | 0 | 0 |
Manufactured Housing [Member] | Substandard [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | 1,054 | 1,553 |
Manufactured Housing [Member] | Doubtful [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | 0 | 0 |
Commercial Real Estate [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | 545,317 | 480,801 |
Commercial Real Estate [Member] | Commercial Real Estate [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | 481,499 | 429,769 |
Commercial Real Estate [Member] | Commercial Real Estate [Member] | Pass [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | 460,110 | 415,471 |
Commercial Real Estate [Member] | Commercial Real Estate [Member] | Special Mention [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | 13,381 | 3,043 |
Commercial Real Estate [Member] | Commercial Real Estate [Member] | Substandard [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | 8,008 | 11,255 |
Commercial Real Estate [Member] | Commercial Real Estate [Member] | Doubtful [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | 0 | 0 |
Commercial Real Estate [Member] | SBA 504 1st Trust Deed [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | 12,947 | 16,961 |
Commercial Real Estate [Member] | SBA 504 1st Trust Deed [Member] | Pass [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | 12,477 | 14,646 |
Commercial Real Estate [Member] | SBA 504 1st Trust Deed [Member] | Special Mention [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | 0 | 0 |
Commercial Real Estate [Member] | SBA 504 1st Trust Deed [Member] | Substandard [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | 470 | 2,315 |
Commercial Real Estate [Member] | SBA 504 1st Trust Deed [Member] | Doubtful [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | 0 | 0 |
Commercial Real Estate [Member] | Land [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | 11,237 | 7,185 |
Commercial Real Estate [Member] | Land [Member] | Pass [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | 11,237 | 7,185 |
Commercial Real Estate [Member] | Land [Member] | Special Mention [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | 0 | 0 |
Commercial Real Estate [Member] | Land [Member] | Substandard [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | 0 | 0 |
Commercial Real Estate [Member] | Land [Member] | Doubtful [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | 0 | 0 |
Commercial Real Estate [Member] | Construction [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | 38,374 | 25,593 |
Commercial Real Estate [Member] | Construction [Member] | Pass [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | 38,374 | 25,593 |
Commercial Real Estate [Member] | Construction [Member] | Special Mention [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | 0 | 0 |
Commercial Real Estate [Member] | Construction [Member] | Substandard [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | 0 | 0 |
Commercial Real Estate [Member] | Construction [Member] | Doubtful [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | 0 | 0 |
Commercial [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | 57,835 | 52,663 |
Commercial [Member] | Pass [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | 52,384 | 50,372 |
Commercial [Member] | Special Mention [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | 2,723 | 26 |
Commercial [Member] | Substandard [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | 2,728 | 2,265 |
Commercial [Member] | Doubtful [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | 0 | 0 |
SBA [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | 1,644 | 2,005 |
SBA [Member] | Pass [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | 1,644 | 1,891 |
SBA [Member] | Special Mention [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | 0 | 0 |
SBA [Member] | Substandard [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | 0 | 114 |
SBA [Member] | Doubtful [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | 0 | 0 |
HELOC [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | 2,613 | 3,579 |
HELOC [Member] | Pass [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | 2,613 | 3,579 |
HELOC [Member] | Special Mention [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | 0 | 0 |
HELOC [Member] | Substandard [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | 0 | 0 |
HELOC [Member] | Doubtful [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | 0 | 0 |
Single Family Real Estate [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | 8,709 | 8,749 |
Single Family Real Estate [Member] | Pass [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | 8,554 | 8,487 |
Single Family Real Estate [Member] | Special Mention [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | 0 | 0 |
Single Family Real Estate [Member] | Substandard [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | 155 | 262 |
Single Family Real Estate [Member] | Doubtful [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | 0 | 0 |
Consumer [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | 107 | 109 |
Consumer [Member] | Pass [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | 107 | 109 |
Consumer [Member] | Special Mention [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | 0 | 0 |
Consumer [Member] | Substandard [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | 0 | 0 |
Consumer [Member] | Doubtful [Member] | ||
Gross loans by risk rating [Abstract] | ||
Total loans held for investment | $ 0 | $ 0 |
LOANS HELD FOR INVESTMENT, Trou
LOANS HELD FOR INVESTMENT, Troubled Debt Restructured Loan (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 USD ($) Loan | Dec. 31, 2021 USD ($) Loan | Dec. 31, 2020 USD ($) Loan | |
Troubled Debt Restructured Loans [Abstract] | |||
Loan classified as TDRs | $ 6,000 | $ 8,600 | |
Number of loans | Loan | 2 | 1 | 7 |
Pre-modification recorded investment | $ 221 | $ 167 | $ 1,542 |
Post modification recorded investment | 221 | 167 | 1,542 |
Effect on allowance for loan losses | 0 | 0 | 34 |
Rate Reduction [Member] | |||
Troubled Debt Restructured Loans [Abstract] | |||
Balance of loans | 0 | 0 | 56 |
Term Extension [Member] | |||
Troubled Debt Restructured Loans [Abstract] | |||
Balance of loans | $ 0 | $ 0 | $ 56 |
Manufactured Housing [Member] | |||
Troubled Debt Restructured Loans [Abstract] | |||
Number of loans | Loan | 2 | 1 | 5 |
Pre-modification recorded investment | $ 221 | $ 167 | $ 56 |
Post modification recorded investment | 221 | 167 | 56 |
Effect on allowance for loan losses | 0 | 0 | 1 |
Manufactured Housing [Member] | Rate Reduction [Member] | |||
Troubled Debt Restructured Loans [Abstract] | |||
Balance of loans | 0 | 0 | 56 |
Manufactured Housing [Member] | Term Extension [Member] | |||
Troubled Debt Restructured Loans [Abstract] | |||
Balance of loans | 0 | 0 | $ 56 |
Commercial [Member] | |||
Troubled Debt Restructured Loans [Abstract] | |||
Number of loans | Loan | 1 | ||
Pre-modification recorded investment | $ 1,469 | ||
Post modification recorded investment | 1,469 | ||
Effect on allowance for loan losses | 33 | ||
Commercial [Member] | Rate Reduction [Member] | |||
Troubled Debt Restructured Loans [Abstract] | |||
Balance of loans | 0 | ||
Commercial [Member] | Term Extension [Member] | |||
Troubled Debt Restructured Loans [Abstract] | |||
Balance of loans | $ 0 | ||
SBA [Member] | |||
Troubled Debt Restructured Loans [Abstract] | |||
Number of loans | Loan | 1 | ||
Pre-modification recorded investment | $ 17 | ||
Post modification recorded investment | 17 | ||
Effect on allowance for loan losses | 0 | ||
SBA [Member] | Rate Reduction [Member] | |||
Troubled Debt Restructured Loans [Abstract] | |||
Balance of loans | 0 | ||
SBA [Member] | Term Extension [Member] | |||
Troubled Debt Restructured Loans [Abstract] | |||
Balance of loans | $ 0 | ||
Performing Financial Instruments [Member] | |||
Troubled Debt Restructured Loans [Abstract] | |||
Loan classified as TDRs | $ 5,800 | $ 8,400 |
LOANS HELD FOR INVESTMENT, Tr_2
LOANS HELD FOR INVESTMENT, Troubled Debt Restructured Loans With Payment Defaults (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 USD ($) Nonpayment | Dec. 31, 2021 USD ($) | Dec. 31, 2020 USD ($) | |
LOANS HELD FOR INVESTMENT [Abstract] | |||
Number of consecutive non-payments for a TDR loan to be deemed default | Nonpayment | 2 | ||
Trouble debt restructurings with payment defaults | $ | $ 0 | $ 0 | $ 0 |
LOANS HELD FOR INVESTMENT, Rela
LOANS HELD FOR INVESTMENT, Related Parties (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Loans and Leases Receivable, Related Parties [Roll Forward] | ||
Balance, beginning | $ 2,919 | $ 2,989 |
New loans | 0 | 165 |
Repayments and other | (297) | (235) |
Balance, ending | 2,622 | 2,919 |
Loan commitments outstanding with related parties | $ 300 | $ 600 |
PREMISES AND EQUIPMENT (Details
PREMISES AND EQUIPMENT (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Premises and equipment [Abstract] | ||
Premises and equipment, gross | $ 19,962 | $ 19,722 |
Accumulated depreciation | (13,858) | (13,146) |
Premises and equipment, net | 6,104 | 6,576 |
Bank Premises and Land [Member] | ||
Premises and equipment [Abstract] | ||
Premises and equipment, gross | 3,983 | 3,959 |
Furniture, Fixtures, and Equipment [Member] | ||
Premises and equipment [Abstract] | ||
Premises and equipment, gross | 10,865 | 10,637 |
Leasehold Improvements [Member] | ||
Premises and equipment [Abstract] | ||
Premises and equipment, gross | 4,992 | 4,986 |
Construction in Progress [Member] | ||
Premises and equipment [Abstract] | ||
Premises and equipment, gross | $ 122 | $ 140 |
OTHER ASSETS ACQUIRED THROUGH_3
OTHER ASSETS ACQUIRED THROUGH FORECLOSURE (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
OTHER ASSETS ACQUIRED THROUGH FORECLOSURE [Abstract] | |||
Balance, beginning of period | $ 2,518 | $ 2,614 | $ 2,524 |
Additions | 0 | 136 | 106 |
Proceeds from dispositions | (384) | 0 | 0 |
Gains (losses) on sales, net | 116 | (232) | (16) |
Balance, end of period | $ 2,250 | $ 2,518 | $ 2,614 |
DEPOSITS (Details)
DEPOSITS (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Summary of deposits by type [Abstract] | ||
Non-interest-bearing demand deposits | $ 216,494 | $ 209,893 |
Interest-bearing deposits [Abstract] | ||
NOW accounts | 38,068 | 39,289 |
Money market deposit account | 390,105 | 498,219 |
Savings accounts | 23,490 | 23,675 |
Time deposits of $250,000 or more | 6,693 | 17,612 |
Other time deposits | 200,234 | 161,443 |
Total deposits | 875,084 | 950,131 |
Deposit liabilities that may be immediately withdrawn | 668,200 | |
Maturities of time certificates [Abstract] | ||
2023 | 115,033 | |
2024 | 34,606 | |
2025 | 9,485 | |
2026 | 42,972 | |
2027 | 4,831 | |
Total | 206,927 | |
Deposits with CDARS | 51,100 | 6,500 |
Deposit Liabilities, ICS | 69,200 | 93,300 |
Deposits from related parties | $ 29,300 | $ 41,800 |
BORROWINGS (Details)
BORROWINGS (Details) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | ||
Sep. 30, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
FHLB advances by maturity date [Abstract] | ||||
Amount | $ 90,000 | $ 90,000 | ||
Financial Home Loan Bank Advances [Abstract] | ||||
Securities pledged to FHLB | 21,100 | 13,200 | ||
Loans | 935,123 | 869,547 | ||
Total FHLB interest expense | 817 | 869 | $ 1,782 | |
Federal Funds Purchased Lines [Abstract] | ||||
Federal funds borrowing lines at correspondent banks | 20,000 | |||
Federal funds amount outstanding | $ 0 | $ 0 | ||
Weighted Average [Member] | ||||
FHLB advances by maturity date [Abstract] | ||||
Rate | 0.86% | 0.86% | ||
FHLB Advance April 15, 2025 [Member] | ||||
FHLB advances by maturity date [Abstract] | ||||
Amount | $ 6,000 | $ 6,000 | ||
Rate | 0.76% | 0.76% | ||
Maturity date | Apr. 15, 2025 | |||
FHLB Advance April 15, 2025 [Member] | ||||
FHLB advances by maturity date [Abstract] | ||||
Amount | $ 39,000 | $ 39,000 | ||
Rate | 0.78% | 0.78% | ||
Maturity date | Apr. 15, 2025 | |||
FHLB Advance June 23, 2025 [Member] | ||||
FHLB advances by maturity date [Abstract] | ||||
Amount | $ 30,000 | $ 30,000 | ||
Rate | 0.95% | 0.95% | ||
Maturity date | Jun. 23, 2025 | |||
FHLB Advance June 23, 2025 [Member] | ||||
FHLB advances by maturity date [Abstract] | ||||
Amount | $ 15,000 | $ 15,000 | ||
Rate | 0.92% | 0.92% | ||
Maturity date | Jun. 23, 2025 | |||
Line of Credit [Member] | ||||
Line of Credit [Abstract] | ||||
Maximum borrowing capacity | $ 5,000 | $ 10,000 | ||
Required compensating deposit | $ 1,000 | |||
Minimum debt service coverage ratio | 1.65 | |||
Minimum Tier 1 leverage ratio | 7% | |||
Minimum total risk-based capital ratio | 10% | |||
Maximum net non-accrual ratio | 3% | |||
Renewal term | 1 year | |||
Outstanding balance | $ 0 | $ 0 | ||
Line of Credit [Member] | Prime Rate [Member] | ||||
Line of Credit [Abstract] | ||||
Basis spread on variable rate | 0.25% | |||
Federal Home Loan Bank Advances [Member] | ||||
Financial Home Loan Bank Advances [Abstract] | ||||
Letter of credit with FHLB | 39,000 | |||
Available for additional borrowing | 41,600 | 44,500 | ||
Total FHLB interest expense | 800 | 900 | $ 1,400 | |
Federal Home Loan Bank Advances [Member] | Asset Pledged as Collateral [Member] | ||||
Financial Home Loan Bank Advances [Abstract] | ||||
Securities pledged to FHLB | 21,100 | 13,200 | ||
Loans | 232,600 | 286,600 | ||
Federal Reserve Bank Advances [Member] | ||||
Line of Credit [Abstract] | ||||
Outstanding balance | 0 | 0 | ||
Available borrowing capacity | 78,900 | 119,000 | ||
Federal Reserve Bank Advances [Member] | Asset Pledged as Collateral [Member] | ||||
Financial Home Loan Bank Advances [Abstract] | ||||
Loans | $ 248,600 | $ 259,500 |
COMMITMENTS AND CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Fair Value, Off-balance Sheet Risks, Disclosure Information [Abstract] | ||
Contractual amounts for unfunded commitments and letters of credit | $ 100,011 | $ 85,255 |
Unfunded Commitments and Letters of Credit [Abstract] | ||
Loss contingency for unfunded loan commitments and letters of credit | 94 | 94 |
Commitments to Extend Credit [Member] | ||
Fair Value, Off-balance Sheet Risks, Disclosure Information [Abstract] | ||
Contractual amounts for unfunded commitments and letters of credit | 100,011 | 85,238 |
Standby Letters of Credit [Member] | ||
Fair Value, Off-balance Sheet Risks, Disclosure Information [Abstract] | ||
Contractual amounts for unfunded commitments and letters of credit | $ 0 | $ 17 |
STOCKHOLDERS' EQUITY, Common St
STOCKHOLDERS' EQUITY, Common Stock Warrants and Common Stock (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Common Stock [Abstract] | |||
Common stock dividend paid | $ 2,574 | $ 2,312 | $ 1,652 |
Common Stock [Member] | |||
Common Stock [Abstract] | |||
Common stock dividend paid | $ 2,600 | 2,300 | $ 1,700 |
Common Stock [Member] | Stock Repurchase Program [Member] | |||
Common Stock [Abstract] | |||
Amount of common stock repurchase program authorized | $ 4,500 | ||
Common stock shares repurchased to date (in shares) | 350,189 | ||
Common stock shares repurchased to date, value | $ 3,100 | ||
Common stock shares repurchased to date, average price (in dollars per share) | $ 8.75 | ||
Common stock shares repurchased during the period (in shares) | 0 | 0 | 0 |
STOCKHOLDERS' EQUITY, Equity Co
STOCKHOLDERS' EQUITY, Equity Compensation Plans (Details) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 USD ($) Plan $ / shares shares | Dec. 31, 2021 USD ($) $ / shares shares | Dec. 31, 2020 USD ($) | |
Share-based Compensation Arrangement by Share-based Payment Award, Additional General Disclosures [Abstract] | |||
Number of stock option plans | Plan | 2 | ||
Option-pricing model assumptions [Abstract] | |||
Expected life in years | 6 years 3 months 18 days | 6 years 4 months 24 days | 6 years 3 months 18 days |
Risk-free interest rate | 2.53% | 1.80% | 0.66% |
Expected volatility | 28.81% | 36.40% | 24.20% |
Annual dividend yield | 2.05% | 1.94% | 2.54% |
Stock Options [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Additional General Disclosures [Abstract] | |||
Vesting period | 5 years | ||
Contractual life | 10 years | ||
Number of shares available for grant (in shares) | 353,301 | ||
Unrecognized compensation cost | $ | $ 400 | ||
Period for recognition of unrecognized compensation cost | 3 years 3 months 18 days | ||
Intrinsic value of options exercised | $ | $ 500 | $ 900 | $ 900 |
Option Shares [Roll Forward] | |||
Outstanding options, beginning of period (in shares) | 685,547 | ||
Granted (in shares) | 55,500 | ||
Exercised (in shares) | (110,497) | ||
Forfeited or expired (in shares) | (24,600) | ||
Outstanding options, end of period (in shares) | 605,950 | 685,547 | |
Options exercisable, end of period (in shares) | 337,270 | ||
Options expected to vest, end of period (in shares) | 552,049 | ||
Weighted Average Exercise Price [Abstract] | |||
Outstanding options, beginning of period (in dollars per share) | $ / shares | $ 9.47 | ||
Granted (in dollars per share) | $ / shares | 14.14 | ||
Exercised (in dollars per share) | $ / shares | 8.82 | ||
Forfeited or expired (in dollars per share) | $ / shares | 11.12 | ||
Outstanding options, end of period (in dollars per share) | $ / shares | 9.95 | $ 9.47 | |
Options exercisable, end of period (in dollars per share) | $ / shares | 8.99 | ||
Options expected to vest, end of period (in dollars per share) | $ / shares | $ 9.76 | ||
Weighted Average Remaining Term [Abstract] | |||
Outstanding options | 5 years 10 months 2 days | ||
Options exercisable | 4 years 5 months 19 days | ||
Options expected to vest | 5 years 6 months 29 days | ||
Aggregate Intrinsic Value [Abstract] | |||
Outstanding options, end of period | $ | $ 3,041 | ||
Options exercisable, end of period | $ | 2,257 | ||
Options expected to vest, end of period | $ | $ 2,875 | ||
Restricted Stock [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Additional General Disclosures [Abstract] | |||
Vesting period | 5 years | ||
Unrecognized compensation cost | $ | $ 300 | ||
Period for recognition of unrecognized compensation cost | 4 years 3 months 18 days | ||
Nonvested Restricted Stock Awards [Roll Forward] | |||
Unvested options, beginning of period (in shares) | 14,084 | ||
Granted (in shares) | 23,665 | ||
Vested (in shares) | (2,815) | ||
Forfeited (in shares) | 0 | ||
Unvested options, end of period (in shares) | 34,934 | 14,084 | |
Weighted Average Grant-Date Fair Value [Roll Forward] | |||
Unvested options, beginning of period (in dollars per share) | $ / shares | $ 12.5 | ||
Granted (in dollars per share) | $ / shares | 14.4 | ||
Vested (in dollars per share) | $ / shares | 12.5 | ||
Forfeited (in dollars per share) | $ / shares | 0 | ||
Unvested options, end of period (in dollars per share) | $ / shares | $ 13.78 | $ 12.5 |
CAPITAL REQUIREMENTS (Details)
CAPITAL REQUIREMENTS (Details) | Dec. 31, 2022 | Dec. 31, 2021 |
Regulatory Ratios [Abstract] | ||
Total capital ratio, minimum capital ratios | 0.08 | 0.08 |
Total capital ratio, well-capitalized ratios | 0.10 | 0.10 |
Total capital ratio, minimum capital requirements including fully phased in capital conservation buffer | 0.105 | 0.105 |
Tier 1 risk-based capital ratio, minimum capital ratios | 0.06 | 0.06 |
Tier 1 risk-based capital ratio, well-capitalized ratios | 0.08 | 0.08 |
Tier 1 risk-based capital ratio, minimum capital requirements including fully phased in capital conservation buffer | 0.085 | 0.085 |
Common Equity Tier 1 ratio, minimum capital ratios | 0.045 | 0.045 |
Common Equity Tier 1 ratio, well-capitalized ratios | 0.065 | 0.065 |
Common Equity Tier 1 ratio, minimum capital requirements including fully phased in capital conservation buffer | 0.07 | 0.07 |
Tier 1 leverage ratio, minimum capital ratios | 0.04 | 0.04 |
Tier 1 leverage ratio, well-capitalized ratios | 0.05 | 0.05 |
CWB [Member] | ||
Regulatory Ratios [Abstract] | ||
Total capital ratio | 0.1256 | 0.1219 |
Tier 1 risk-based capital ratio | 0.1144 | 0.1102 |
Common Equity Tier 1 ratio | 0.1144 | 0.1102 |
Tier 1 leverage ratio | 0.1034 | 0.0856 |
REVENUE RECOGNITION (Details)
REVENUE RECOGNITION (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Noninterest Income [Abstract] | |||
Non-interest income (in-scope of Topic 606) | $ 853 | $ 711 | $ 455 |
Non-interest income (out-of-scope of Topic 606) | 3,125 | 3,042 | 3,457 |
Total non-interest income | 3,978 | 3,753 | 3,912 |
Service Charges on Deposit Accounts [Member] | |||
Noninterest Income [Abstract] | |||
Non-interest income (in-scope of Topic 606) | 335 | 243 | 298 |
Exchange Fees and Other Service Charges [Member] | |||
Noninterest Income [Abstract] | |||
Non-interest income (in-scope of Topic 606) | $ 518 | $ 468 | $ 157 |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Current [Abstract] | |||
Federal | $ 3,518 | $ 3,671 | $ 2,874 |
State | 1,994 | 2,046 | 1,595 |
Current income tax expense (benefit) | 5,512 | 5,717 | 4,469 |
Deferred [Abstract] | |||
Federal | (178) | (371) | (651) |
State | (72) | (134) | (308) |
Deferred income tax expense (benefit) | (250) | (505) | (959) |
Total provision for income taxes | $ 5,262 | $ 5,212 | $ 3,510 |
Reconciliation between statutory income tax rate and effective tax rate [Abstract] | |||
Federal income tax at statutory rate | 21% | 21% | 21% |
State franchise tax, net of federal benefit | 8.20% | 8.60% | 8.60% |
Other | (1.10%) | (1.10%) | 0.30% |
Tax law change | 0% | 0% | 0% |
Total provision for income taxes | 28.10% | 28.50% | 29.90% |
Deferred Tax Assets [Abstract] | |||
Allowance for loan losses | $ 3,127 | $ 2,978 | |
Bonus accrual | 8 | 300 | |
Deferred compensation | 1,057 | 944 | |
Lease liability | 1,555 | 1,549 | |
Deferred state taxes | 419 | 435 | |
Unrealized loss of AFS securities | 305 | 0 | |
Other | 586 | 349 | |
Total gross deferred tax assets | 7,057 | 6,555 | |
Deferred tax asset valuation allowance | 0 | 0 | |
Total deferred tax assets | 7,057 | 6,555 | |
Deferred Tax Liabilities [Abstract] | |||
Depreciation | (469) | (527) | |
Right of use asset | (1,535) | (1,489) | |
Unrealized gain on AFS securities | 0 | (57) | |
Other | 0 | (41) | |
Total deferred tax liabilities | (2,004) | (2,114) | |
Net deferred tax assets | 5,053 | 4,441 | |
Uncertain tax positions | $ 0 | $ 0 |
LEASES (Details)
LEASES (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Operating leases [Abstract] | ||
Operating lease, right-of-use assets | $ 5,200 | |
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List] | Other Assets | |
Lease cost [Abstract] | ||
Operating lease cost | $ 1,012 | $ 1,000 |
Sublease income | 0 | 0 |
Total lease cost | 1,012 | 1,000 |
Other information [Abstract] | ||
Cash paid for amounts included in the measurement of lease liabilities - operating leases | $ 1,003 | $ 992 |
Weighted average remaining lease term in years - operating leases | 7 years 7 days | 8 years 2 months 1 day |
Weighted average discount rate - operating leases | 3.26% | 3.25% |
Future minimum operating lease payments [Abstract] | ||
2023 | $ 1,014 | |
2024 | 1,025 | |
2025 | 976 | |
2026 | 876 | |
2027 | 473 | |
Thereafter | 1,538 | |
Total future minimum lease payments | 5,902 | |
Less remaining imputed interest | (641) | |
Total lease liabilities | $ 5,261 | |
Operating Lease, Liability, Statement of Financial Position [Extensible List] | Other Liabilities | |
Minimum [Member] | ||
Operating leases [Abstract] | ||
Term of operating leases | 2 years | |
Maximum [Member] | ||
Operating leases [Abstract] | ||
Term of operating leases | 10 years |
EMPLOYEE BENEFIT PLANS (Details
EMPLOYEE BENEFIT PLANS (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
EMPLOYEE BENEFIT PLANS [Abstract] | |||
Defined Contribution Plan, Tax Status [Extensible List] | us-gaap:QualifiedPlanMember | ||
Defined Contribution Plan, Type [Extensible List] | us-gaap:PensionPlansDefinedBenefitMember | ||
Maximum amount of annual contribution per participant under age 50 | $ 20,500 | ||
Percentage of maximum matching contribution by employer | 3% | ||
Employer contribution | $ 300,000 | $ 300,000 | $ 400,000 |
Salary Continuation [Abstract] | |||
Maximum period of monthly cash payment to the officer or beneficiaries in the event of death, disability or retirement | 15 years | ||
Salary continuation liability accrual | $ 1,500,000 | 1,200,000 | |
Cash surrender value of life insurance | $ 8,700,000 | 9,800,000 | |
Executive Officers [Member] | Deferred Compensation Plans [Member] | |||
Deferred Compensation Arrangement with Individual, Excluding Share-based Payments and Postretirement Benefits [Abstract] | |||
Age of vesting | 65 years | ||
Expenses incurred | $ 300,000 | 200,000 | $ 300,000 |
Deferred compensation liability | $ 2,100,000 | $ 2,000,000 | |
Select Group of Management or Highly Compensated Employees [Member] | Unfunded Nonqualified Deferred Compensation Arrangement [Member] | |||
Deferred Compensation Arrangement with Individual, Excluding Share-based Payments and Postretirement Benefits [Abstract] | |||
Maximum percentage of deferred base salary and bonus | 30% | ||
Period of certificate of deposit rate paid on vested balance | 36 months |
FAIR VALUE MEASUREMENT, Fair Va
FAIR VALUE MEASUREMENT, Fair Value of Assets Measured on Recurring Basis (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Assets [Abstract] | ||||
Investment securities - measured at fair value | $ 225 | $ 248 | ||
Investment securities available-for-sale | 26,688 | 19,711 | ||
Servicing assets | 26 | 44 | $ 43 | $ 40 |
U.S. Government Agency Notes [Member] | ||||
Assets [Abstract] | ||||
Investment securities available-for-sale | 4,107 | 5,508 | ||
U.S. Government Agency CMO [Member] | ||||
Assets [Abstract] | ||||
Investment securities available-for-sale | 4,296 | 4,883 | ||
U.S. Treasury Securities [Member] | ||||
Assets [Abstract] | ||||
Investment securities available-for-sale | 9,970 | |||
Corporate Debt Securities [Member] | ||||
Assets [Abstract] | ||||
Investment securities available-for-sale | 8,315 | 9,320 | ||
Recurring [Member] | ||||
Assets [Abstract] | ||||
Investment securities - measured at fair value | 225 | 248 | ||
Interest only strips | 7 | 15 | ||
Servicing assets | 26 | 1,600 | ||
Total | 26,946 | 21,574 | ||
Recurring [Member] | U.S. Government Agency Notes [Member] | ||||
Assets [Abstract] | ||||
Investment securities available-for-sale | 4,107 | 5,508 | ||
Recurring [Member] | U.S. Government Agency CMO [Member] | ||||
Assets [Abstract] | ||||
Investment securities available-for-sale | 4,296 | 4,883 | ||
Recurring [Member] | U.S. Treasury Securities [Member] | ||||
Assets [Abstract] | ||||
Investment securities available-for-sale | 9,970 | |||
Recurring [Member] | Corporate Debt Securities [Member] | ||||
Assets [Abstract] | ||||
Investment securities available-for-sale | 8,315 | 9,320 | ||
Recurring [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | ||||
Assets [Abstract] | ||||
Investment securities - measured at fair value | 225 | 248 | ||
Interest only strips | 0 | 0 | ||
Servicing assets | 0 | 0 | ||
Total | 225 | 248 | ||
Recurring [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | U.S. Government Agency Notes [Member] | ||||
Assets [Abstract] | ||||
Investment securities available-for-sale | 0 | 0 | ||
Recurring [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | U.S. Government Agency CMO [Member] | ||||
Assets [Abstract] | ||||
Investment securities available-for-sale | 0 | 0 | ||
Recurring [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | U.S. Treasury Securities [Member] | ||||
Assets [Abstract] | ||||
Investment securities available-for-sale | 0 | |||
Recurring [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | Corporate Debt Securities [Member] | ||||
Assets [Abstract] | ||||
Investment securities available-for-sale | 0 | 0 | ||
Recurring [Member] | Significant Other Observable Inputs (Level 2) [Member] | ||||
Assets [Abstract] | ||||
Investment securities - measured at fair value | 0 | 0 | ||
Interest only strips | 0 | 0 | ||
Servicing assets | 0 | 0 | ||
Total | 26,688 | 19,711 | ||
Recurring [Member] | Significant Other Observable Inputs (Level 2) [Member] | U.S. Government Agency Notes [Member] | ||||
Assets [Abstract] | ||||
Investment securities available-for-sale | 4,107 | 5,508 | ||
Recurring [Member] | Significant Other Observable Inputs (Level 2) [Member] | U.S. Government Agency CMO [Member] | ||||
Assets [Abstract] | ||||
Investment securities available-for-sale | 4,296 | 4,883 | ||
Recurring [Member] | Significant Other Observable Inputs (Level 2) [Member] | U.S. Treasury Securities [Member] | ||||
Assets [Abstract] | ||||
Investment securities available-for-sale | 9,970 | |||
Recurring [Member] | Significant Other Observable Inputs (Level 2) [Member] | Corporate Debt Securities [Member] | ||||
Assets [Abstract] | ||||
Investment securities available-for-sale | 8,315 | 9,320 | ||
Recurring [Member] | Significant Unobservable Inputs (Level 3) [Member] | ||||
Assets [Abstract] | ||||
Investment securities - measured at fair value | 0 | 0 | ||
Interest only strips | 7 | 15 | ||
Servicing assets | 26 | 1,600 | ||
Total | 33 | 1,615 | ||
Recurring [Member] | Significant Unobservable Inputs (Level 3) [Member] | U.S. Government Agency Notes [Member] | ||||
Assets [Abstract] | ||||
Investment securities available-for-sale | 0 | 0 | ||
Recurring [Member] | Significant Unobservable Inputs (Level 3) [Member] | U.S. Government Agency CMO [Member] | ||||
Assets [Abstract] | ||||
Investment securities available-for-sale | 0 | 0 | ||
Recurring [Member] | Significant Unobservable Inputs (Level 3) [Member] | U.S. Treasury Securities [Member] | ||||
Assets [Abstract] | ||||
Investment securities available-for-sale | 0 | |||
Recurring [Member] | Significant Unobservable Inputs (Level 3) [Member] | Corporate Debt Securities [Member] | ||||
Assets [Abstract] | ||||
Investment securities available-for-sale | $ 0 | $ 0 |
FAIR VALUE MEASUREMENT, Assets
FAIR VALUE MEASUREMENT, Assets Measured on Non-recurring Basis (Details) - Non-recurring [Member] - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Summary of fair value measurements of assets measured on a non-recurring basis [Abstract] | ||
Impaired loans | $ 3,805 | $ 3,785 |
Other assets acquired through foreclosure | 2,250 | 2,518 |
Total | 6,055 | 6,303 |
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 |
Other assets acquired through foreclosure | 0 | 0 |
Total | 0 | 0 |
Significant Other Observable Inputs (Level 2) [Member] | ||
Summary of fair value measurements of assets measured on a non-recurring basis [Abstract] | ||
Impaired loans | 3,805 | 3,785 |
Other assets acquired through foreclosure | 2,250 | 2,518 |
Total | 6,055 | 6,303 |
Significant Unobservable Inputs (Level 3) [Member] | ||
Summary of fair value measurements of assets measured on a non-recurring basis [Abstract] | ||
Impaired loans | 0 | 0 |
Other assets acquired through foreclosure | 0 | 0 |
Total | $ 0 | $ 0 |
FAIR VALUE MEASUREMENT, Fair _2
FAIR VALUE MEASUREMENT, Fair Value of Financial Instruments (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Financial assets [Abstract] | ||||
Investment securities available-for-sale | $ 26,688 | $ 19,711 | ||
Investment securities - held-to-maturity | 2,557 | 2,815 | ||
Investment securities - measured at fair value | 225 | 248 | ||
Servicing assets | 26 | 44 | $ 43 | $ 40 |
Carrying Amount [Member] | ||||
Financial assets [Abstract] | ||||
Cash and cash equivalents | 64,690 | 208,375 | ||
FHLB and FRB stock | 4,533 | 4,441 | ||
Investment securities available-for-sale | 26,688 | 19,711 | ||
Investment securities - held-to-maturity | 2,557 | 2,815 | ||
Investment securities - measured at fair value | 225 | 248 | ||
Loans held for sale and loans held for investment, net | 944,577 | 881,679 | ||
Accrued interest receivable | 5,295 | 5,841 | ||
Servicing assets | 1,480 | 1,600 | ||
Interest only strips | 7 | 15 | ||
Financial liabilities [Abstract] | ||||
Deposits | 875,084 | 950,131 | ||
FHLB advances | 90,000 | 90,000 | ||
Accrued interest payable | 126 | 58 | ||
Fair Value [Member] | ||||
Financial assets [Abstract] | ||||
Cash and cash equivalents | 64,690 | 208,375 | ||
FHLB and FRB stock | 4,533 | 4,441 | ||
Investment securities available-for-sale | 26,688 | 19,711 | ||
Investment securities - held-to-maturity | 2,423 | 2,974 | ||
Investment securities - measured at fair value | 225 | 248 | ||
Loans held for sale and loans held for investment, net | 895,939 | 876,320 | ||
Accrued interest receivable | 5,295 | 5,841 | ||
Servicing assets | 2,646 | 2,254 | ||
Interest only strips | 7 | 15 | ||
Financial liabilities [Abstract] | ||||
Deposits | 867,697 | 948,648 | ||
FHLB advances | 83,322 | 88,409 | ||
Accrued interest payable | 126 | 58 | ||
Fair Value [Member] | Level 1 [Member] | ||||
Financial assets [Abstract] | ||||
Cash and cash equivalents | 64,690 | 208,375 | ||
FHLB and FRB stock | 0 | 0 | ||
Investment securities available-for-sale | 0 | 0 | ||
Investment securities - held-to-maturity | 0 | 0 | ||
Investment securities - measured at fair value | 225 | 248 | ||
Loans held for sale and loans held for investment, net | 0 | 0 | ||
Accrued interest receivable | 0 | 0 | ||
Servicing assets | 0 | 0 | ||
Interest only strips | 0 | 0 | ||
Financial liabilities [Abstract] | ||||
Deposits | 0 | 0 | ||
FHLB advances | 0 | 0 | ||
Accrued interest payable | 0 | 0 | ||
Fair Value [Member] | Level 2 [Member] | ||||
Financial assets [Abstract] | ||||
Cash and cash equivalents | 0 | 0 | ||
FHLB and FRB stock | 4,533 | 4,441 | ||
Investment securities available-for-sale | 26,688 | 19,711 | ||
Investment securities - held-to-maturity | 2,423 | 2,974 | ||
Investment securities - measured at fair value | 0 | 0 | ||
Loans held for sale and loans held for investment, net | 892,134 | 870,868 | ||
Accrued interest receivable | 5,295 | 5,841 | ||
Servicing assets | 0 | 0 | ||
Interest only strips | 0 | 0 | ||
Financial liabilities [Abstract] | ||||
Deposits | 867,697 | 948,648 | ||
FHLB advances | 83,322 | 88,409 | ||
Accrued interest payable | 126 | 58 | ||
Fair Value [Member] | Level 3 [Member] | ||||
Financial assets [Abstract] | ||||
Cash and cash equivalents | 0 | 0 | ||
FHLB and FRB stock | 0 | 0 | ||
Investment securities available-for-sale | 0 | 0 | ||
Investment securities - held-to-maturity | 0 | 0 | ||
Investment securities - measured at fair value | 0 | 0 | ||
Loans held for sale and loans held for investment, net | 3,805 | 5,452 | ||
Accrued interest receivable | 0 | 0 | ||
Servicing assets | 2,646 | 2,254 | ||
Interest only strips | 7 | 15 | ||
Financial liabilities [Abstract] | ||||
Deposits | 0 | 0 | ||
FHLB advances | 0 | 0 | ||
Accrued interest payable | $ 0 | $ 0 |
ACCUMULATED OTHER COMPREHENSI_3
ACCUMULATED OTHER COMPREHENSIVE INCOME (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Changes in other comprehensive income (loss) by component, net of tax [Roll Forward] | |||
Balance | $ 101,375 | $ 89,007 | $ 81,978 |
Net current-period other comprehensive income | (863) | 57 | 113 |
Balance | 112,650 | 101,375 | 89,007 |
Unrealized Holding Gains (Losses) on AFS [Member] | |||
Changes in other comprehensive income (loss) by component, net of tax [Roll Forward] | |||
Balance | 92 | 35 | (78) |
Other comprehensive income (loss) before reclassifications | (863) | 57 | 113 |
Amounts reclassified from accumulated other comprehensive income | 0 | 0 | 0 |
Net current-period other comprehensive income | (863) | 57 | 113 |
Balance | $ (771) | $ 92 | $ 35 |
PARENT COMPANY FINANCIAL INFO_3
PARENT COMPANY FINANCIAL INFORMATION, Condensed Balance Sheets (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Assets [Abstract] | ||||
Cash and cash equivalents (including interest-bearing deposits in other financial institutions) | $ 64,690 | $ 208,375 | ||
Other assets | 39,878 | 30,689 | ||
Total assets | 1,091,502 | 1,157,052 | ||
Liabilities and Stockholders' Equity [Abstract] | ||||
Other liabilities | 13,768 | 15,546 | ||
Total liabilities | 978,852 | 1,055,677 | ||
Total stockholders' equity | 112,650 | 101,375 | $ 89,007 | $ 81,978 |
Total liabilities and stockholders' equity | 1,091,502 | 1,157,052 | ||
Parent Company [Member] | ||||
Assets [Abstract] | ||||
Cash and cash equivalents (including interest-bearing deposits in other financial institutions) | 67 | 539 | ||
Investment in subsidiary | 112,183 | 100,642 | ||
Other assets | 419 | 198 | ||
Total assets | 112,669 | 101,379 | ||
Liabilities and Stockholders' Equity [Abstract] | ||||
Other borrowings | 0 | 0 | ||
Other liabilities | 19 | 4 | ||
Total liabilities | 19 | 4 | ||
Total stockholders' equity | 112,650 | 101,375 | ||
Total liabilities and stockholders' equity | $ 112,669 | $ 101,379 |
PARENT COMPANY FINANCIAL INFO_4
PARENT COMPANY FINANCIAL INFORMATION, Condensed Income Statements (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Condensed Income Statements [Abstract] | |||
Interest income | $ 49,138 | $ 46,078 | $ 43,854 |
Interest expense | 3,328 | 3,704 | 7,265 |
Net interest income | 45,810 | 42,374 | 36,589 |
Provision for loan losses | (195) | (181) | 1,223 |
Net interest income after provision (credit) for loan losses | 46,005 | 42,555 | 35,366 |
Total non-interest expenses | 31,272 | 27,995 | 27,523 |
Income before provision for income taxes | 18,711 | 18,313 | 11,755 |
Income tax benefit | 5,262 | 5,212 | 3,510 |
Net income | 13,449 | 13,101 | 8,245 |
Parent Company [Member] | |||
Condensed Income Statements [Abstract] | |||
Interest income | 0 | 0 | 3 |
Interest expense | 16 | 17 | 296 |
Net interest income | (16) | (17) | (293) |
Provision for loan losses | 0 | 0 | 0 |
Net interest income after provision (credit) for loan losses | (16) | (17) | (293) |
Equity in income from consolidated subsidiary | 13,779 | 13,271 | 8,826 |
Total income | 13,763 | 13,254 | 8,533 |
Total non-interest expenses | 525 | 420 | 411 |
Income before provision for income taxes | 13,238 | 12,834 | 8,122 |
Income tax benefit | (211) | (267) | (123) |
Net income | $ 13,449 | $ 13,101 | $ 8,245 |
PARENT COMPANY FINANCIAL INFO_5
PARENT COMPANY FINANCIAL INFORMATION, Condensed Statements of Cash Flows (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Cash Flows from Operating Activities [Abstract] | |||
Net income | $ 13,449 | $ 13,101 | $ 8,245 |
Adjustments to reconcile net income to cash provided by operating activities [Abstract] | |||
Stock-based compensation | 289 | 318 | 319 |
Changes in [Abstract] | |||
Other assets | (9,196) | 439 | (2,805) |
Other liabilities | (1,778) | 1,093 | (401) |
Net cash provided by operating activities | 5,856 | 22,220 | 15,843 |
Cash Flows from Investing Activities [Abstract] | |||
Net cash used in investing activities | (72,894) | (42,223) | (91,567) |
Cash Flows from Financing Activities [Abstract] | |||
Common stock dividends paid | (2,574) | (2,312) | (1,652) |
Net cash (used in) provided by financing activities | (76,647) | 167,838 | 53,603 |
Net (decrease) increase in cash and cash equivalents | (143,685) | 147,835 | (22,121) |
Cash and cash equivalents at beginning of year | 208,375 | 60,540 | 82,661 |
Cash and cash equivalents at end of year | 64,690 | 208,375 | 60,540 |
Parent Company [Member] | |||
Cash Flows from Operating Activities [Abstract] | |||
Net income | 13,449 | 13,101 | 8,245 |
Adjustments to reconcile net income to cash provided by operating activities [Abstract] | |||
Equity in undistributed income from subsidiary | (13,779) | (13,271) | (8,826) |
Stock-based compensation | 289 | 318 | 319 |
Changes in [Abstract] | |||
Other assets | (221) | 41 | (1) |
Other liabilities | 15 | (215) | (185) |
Net cash provided by operating activities | (247) | (26) | (448) |
Cash Flows from Investing Activities [Abstract] | |||
Net dividends from and investment in subsidiary | 1,375 | 1,600 | 1,197 |
Net cash used in investing activities | 1,375 | 1,600 | 1,197 |
Cash Flows from Financing Activities [Abstract] | |||
Common stock dividends paid | (2,574) | (2,312) | (1,652) |
Proceeds from issuance of common stock | 974 | 1,204 | 4 |
Net cash (used in) provided by financing activities | (1,600) | (1,108) | (1,648) |
Net (decrease) increase in cash and cash equivalents | (472) | 466 | (899) |
Cash and cash equivalents at beginning of year | 539 | 73 | 972 |
Cash and cash equivalents at end of year | $ 67 | $ 539 | $ 73 |