Document_And_Entity_Informatio
Document And Entity Information | 9 Months Ended | |
Sep. 30, 2013 | Nov. 13, 2013 | |
Document And Entity Information | ' | ' |
Entity Registrant Name | 'M&F BANCORP INC /NC/ | ' |
Entity Central Index Key | '0001094738 | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Entity Well-known Seasoned Issuer | 'No | ' |
Entity Voluntary Filers | 'No | ' |
Entity Current Reporting Status | 'Yes | ' |
Entity Filer Category | 'Smaller Reporting Company | ' |
Entity Common Stock, Shares Outstanding | ' | 2,031,337 |
Document Fiscal Year Focus | '2013 | ' |
Document Fiscal Period Focus | 'Q3 | ' |
Document Type | '10-Q | ' |
Amendment Flag | 'false | ' |
Document Period End Date | 30-Sep-13 | ' |
CONSOLIDATED_BALANCE_SHEETS_Un
CONSOLIDATED BALANCE SHEETS (Unaudited) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Cash and cash equivalents | ' | ' |
Cash and due from banks | $3,403 | $2,527 |
Interest-bearing deposits | 22,959 | 40,059 |
Federal Funds Sold | 3,000 | ' |
Total Cash and cash equivalents | 29,362 | 42,586 |
Investment securities available for sale, at fair value | 57,938 | 60,811 |
Other invested assets | 389 | 488 |
Loans, net of unearned income and deferred fees | 187,156 | 175,222 |
Allowances for loan losses | -3,237 | -3,499 |
Loans, net | 183,919 | 171,723 |
Interest receivable | 862 | 858 |
Bank premises and equipment, net | 4,444 | 4,683 |
Cash surrender value of bank-owned life insurance | 6,139 | 5,978 |
OREO | 2,942 | 3,055 |
Deferred tax assets and taxes receivable, net | 4,551 | 4,387 |
Other assets | 1,563 | 1,530 |
TOTAL ASSETS | 292,109 | 296,099 |
Deposits | ' | ' |
Interest-bearing deposits | 204,526 | 205,921 |
Noninterest-bearing deposits | 45,349 | 44,958 |
Total deposits | 249,875 | 250,879 |
Other borrowings | 867 | 2,937 |
Other liabilities | 5,708 | 6,004 |
Total liabilities | 256,450 | 259,820 |
COMMITMENTS AND CONTINGENCIES | ' | ' |
Stockholders' equity: | ' | ' |
Series B Preferred Stock - $1,000 liquidation value per share, 11,735 shares issued and outstanding as of September 30, 2013, and December 31, 2012 | 11,727 | 11,725 |
Common stock, no par value 10,000,000 shares authorized as of September 30, 2013 and December 31, 2012; 2,031,337 shares issued and outstanding as of September 30, 2013 and December 31, 2012 | 8,732 | 8,732 |
Retained earnings | 17,211 | 17,230 |
Accumulated other comprehensive loss | -2,011 | -1,408 |
Total stockholders' equity | 35,659 | 36,279 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $292,109 | $296,099 |
CONSOLIDATED_BALANCE_SHEETS_Un1
CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
Statement of Financial Position [Abstract] | ' | ' |
Series B Preferred stock, liquidation value (in dollars per share) | $1,000 | $1,000 |
Series B Preferred stock, issued (in shares) | 11,735 | 11,735 |
Series B Preferred stock, outstanding (in shares) | 11,735 | 11,735 |
Common stock, no par value (in dollars per share) | $0 | $0 |
Common stock, authorized (in shares) | 10,000,000 | 10,000,000 |
Common stock, issued (in shares) | 2,031,337 | 2,031,337 |
Common stock, outstanding (in shares) | 2,031,337 | 2,031,337 |
CONSOLIDATED_STATEMENTS_OF_INC
CONSOLIDATED STATEMENTS OF INCOME (LOSS) (Unaudited) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Interest income: | ' | ' | ' | ' |
Loans, including fees | $2,661 | $2,775 | $7,573 | $7,969 |
Investment securities, including dividends | ' | ' | ' | ' |
Taxable | 166 | 229 | 535 | 636 |
Tax-exempt | 9 | 23 | 27 | 91 |
Other | 21 | 21 | 56 | 94 |
Total interest income | 2,857 | 3,048 | 8,191 | 8,790 |
Interest expense: | ' | ' | ' | ' |
Deposits | 188 | 227 | 550 | 695 |
Borrowings | 2 | 7 | 5 | 46 |
Total interest expense | 190 | 234 | 555 | 741 |
Net interest income | 2,667 | 2,814 | 7,636 | 8,049 |
Less provision for loan losses | 10 | 122 | 10 | 166 |
Net interest income after provision for loan losses | 2,657 | 2,692 | 7,626 | 7,883 |
Noninterest income: | ' | ' | ' | ' |
Service charges | 334 | 362 | 953 | 1,024 |
Rental income | 71 | 76 | 214 | 229 |
Cash surrender value of life insurance | 51 | 52 | 159 | 152 |
Realized gain on sale of securities | ' | 67 | ' | 256 |
Other income | 1 | 1 | 3 | 4 |
Total noninterest income | 457 | 558 | 1,329 | 1,665 |
Noninterest expense: | ' | ' | ' | ' |
Salaries and employee benefits | 1,403 | 1,492 | 4,313 | 4,393 |
Occupancy and equipment | 374 | 400 | 1,119 | 1,124 |
Directors fees | 67 | 67 | 224 | 218 |
Marketing | 54 | 75 | 142 | 164 |
Professional fees | 201 | 143 | 649 | 570 |
Information technology | 190 | 233 | 611 | 696 |
FDIC deposit insurance | 135 | 131 | 363 | 395 |
OREO expense, net | 49 | 45 | 267 | 146 |
Realized gain (loss) on sale of OREO | -2 | -4 | -30 | 42 |
Gains at foreclosure | -3 | ' | -8 | ' |
Delivery expenses | 44 | 48 | 128 | 150 |
Other | 308 | 340 | 879 | 934 |
Total noninterest expense | 2,820 | 2,970 | 8,657 | 8,832 |
Income before income taxes | 294 | 280 | 298 | 716 |
Income tax expense | 139 | 87 | 140 | 196 |
Net income | 155 | 193 | 158 | 520 |
Less preferred stock dividends and accretion | 59 | 59 | 177 | 179 |
Net income (loss) available to common stockholders | $96 | $134 | ($19) | $341 |
Basic and diluted earnings (loss) per share of common stock: | $0.05 | $0.07 | ($0.01) | $0.17 |
Weighted average shares of common stock outstanding: | ' | ' | ' | ' |
Basic and diluted | 2,031,337 | 2,031,337 | 2,031,337 | 2,031,337 |
CONSOLIDATED_STATEMENTS_OF_COM
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Unaudited) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Statement of Comprehensive Income [Abstract] | ' | ' | ' | ' |
Net income | $155 | $193 | $158 | $520 |
Other comprehensive income (loss): | ' | ' | ' | ' |
Unrealized holding gains (losses) on securities available for sale | -271 | 408 | -942 | 523 |
Tax effect | 102 | -146 | 339 | -165 |
Unrealized holding gains (losses) on securities available for sale, net of tax | -169 | 262 | -603 | 358 |
Reclassification adjustments for realized gains | ' | -67 | ' | -256 |
Tax effect | ' | 26 | ' | 51 |
Reclassification adjustments for realized gains, net of tax | ' | -41 | ' | -205 |
Defined benefit pension plans: | ' | ' | ' | ' |
Net periodic pension cost | 90 | 106 | 270 | 213 |
Net pension gain (loss) | -90 | -106 | -270 | -213 |
Tax effect | ' | ' | ' | ' |
Defined benefit plan adjustment, net of tas | ' | ' | ' | ' |
Other comprehensive (loss), net of tax | -169 | 221 | -603 | 153 |
Comprehensive income (loss) | ($14) | $414 | ($445) | $673 |
CONSOLIDATED_STATEMENTS_OF_CHA
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (Unaudited) (USD $) | Common Stock | Preferred Stock | Retained Earnings | Accumulated Other Comprehensive Loss | Total |
In Thousands, except Share data | |||||
Balance, Beginning at Dec. 31, 2011 | $8,732 | $11,724 | $17,380 | ($1,439) | $36,397 |
Balance, Beginning, shares at Dec. 31, 2011 | 2,031,337 | ' | ' | ' | ' |
Accretion of Series B preferred stock issuance costs | ' | 1 | -1 | ' | ' |
Net income | ' | ' | 520 | ' | 520 |
Other comprehensive income (loss), net of tax | ' | ' | ' | 153 | 153 |
Dividends declared on preferred stock | ' | ' | -178 | ' | ' |
Balance, Ending at Sep. 30, 2012 | 8,732 | 11,725 | 17,721 | -1,286 | ' |
Balance, Ending, shares at Sep. 30, 2012 | 2,031,337 | ' | ' | ' | ' |
Balance, Beginning at Dec. 31, 2012 | 8,732 | 11,725 | 17,230 | -1,408 | 36,279 |
Balance, Beginning, shares at Dec. 31, 2012 | 2,031,337 | ' | ' | ' | 2,031,337 |
Accretion of Series B preferred stock issuance costs | ' | 2 | -2 | ' | ' |
Net income | ' | ' | 158 | ' | 158 |
Other comprehensive income (loss), net of tax | ' | ' | ' | -603 | -603 |
Dividends declared on preferred stock | ' | ' | -175 | ' | ' |
Balance, Ending at Sep. 30, 2013 | $8,732 | $11,727 | $17,211 | ($2,011) | $35,659 |
Balance, Ending, shares at Sep. 30, 2013 | 2,031,337 | ' | ' | ' | 2,031,337 |
CONSOLIDATED_STATEMENTS_OF_CAS
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (USD $) | 9 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
Cash flows from operating activities: | ' | ' |
Net income | $158 | $520 |
Adjustments to reconcile net income to net cash provided by operating activities: | ' | ' |
Provision for loan losses | 10 | 166 |
Depreciation and amortization | 263 | 256 |
Amortization of discounts/premiums on investments, net | 845 | 75 |
Loan purchase accounting amortization, net | 43 | 130 |
Deferred income tax provision | 61 | ' |
Deferred loan origination fees and costs, net | 129 | 108 |
Gains on sale of available for sale securities | ' | -256 |
Increase in cash surrender value of bank owned life insurance | -159 | -152 |
Gain on foreclosure | -8 | ' |
Net gain (loss) on sale of OREO | -30 | 42 |
Writedown of OREO | 178 | 38 |
Changes in: | ' | ' |
Accrued interest receivable and other assets | 77 | 374 |
Other liabilities | -258 | 3,382 |
Net cash provided by operating activities | 1,309 | 4,683 |
Activity in available-for-sale securities: | ' | ' |
Sales | ' | 7,224 |
Maturities and calls | ' | 819 |
Principal collections | 14,094 | 7,478 |
Purchases | -13,008 | -40,263 |
FHLB stock stock redemptions | 99 | ' |
Net (increase) decrease in loans | -14,522 | 8,050 |
Purchases of bank premises and equipment | -63 | -263 |
Payment of BOLI premium | -2 | -6 |
Proceeds from sale of real estate owned | 69 | 400 |
Net cash used in investing activities | -13,333 | -16,561 |
Cash flows from financing activities: | ' | ' |
Net increase (decrease) in deposits | -965 | 2,228 |
Proceeds from other borrowings | 93 | 1,197 |
Repayments of other borrowings | -153 | -1,149 |
Cash dividends | -175 | -178 |
Net cash provided by (used in) financing activities | -1,200 | 2,098 |
Net decrease in cash and cash equivalents | -13,224 | -9,780 |
Cash and cash equivalents as of the beginning of the period | 42,586 | 61,296 |
Cash and cash equivalents as of the end of the period | 29,362 | 51,516 |
Cash paid during period for: | ' | ' |
Interest | 584 | 813 |
Noncash Transactions | ' | ' |
Loans transferred to OREO | 134 | 337 |
Net unrealized loss on investment securities available for sale, net of deferred income tax | -603 | 267 |
Transfer of participation loans sold from other borrowings to loans | -2,010 | ' |
Transfer between fixed assets and non-interest bearing deposit account | -39 | ' |
Accretion of Series B preferred stock | $2 | $1 |
SUMMARY_OF_SIGNIFICANT_ACCOUNT
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 9 Months Ended | |
Sep. 30, 2013 | ||
Summary Of Significant Accounting Policies | ' | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ' | |
1 | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Nature of Operations | ||
M&F Bancorp, Inc. (the “Company”) is a bank holding company, and the parent company of Mechanics and Farmers Bank (the “Bank”), a state chartered commercial bank incorporated in North Carolina (“NC”) in 1907, which began operations in 1908. The Bank has seven branches in NC: two in Durham, two in Raleigh, and one each in Charlotte, Greensboro and Winston-Salem. The Company, headquartered in Durham, operates as a single business segment and offers a wide variety of consumer and commercial banking services and products almost exclusively in NC. | ||
Basis of Presentation | ||
The Consolidated Financial Statements include the accounts and transactions of the Company and the Bank, the wholly owned subsidiary. All significant inter-company accounts and transactions have been eliminated in consolidation. | ||
The Consolidated Financial Statements have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) for interim financial statements and in accordance with the instructions for Form 10-Q and Rule 8-03 of Regulation S-X. The accompanying Consolidated Financial Statements and Notes are unaudited except for the balance sheet and footnote information as of December 31, 2012, which were derived from the Company’s audited consolidated Annual Report on Form 10-K as of and for the year ended December 31, 2012. | ||
The Consolidated Financial Statements included herein do not include all the information and notes required by GAAP and should be read in conjunction with the Consolidated Financial Statements and the related notes thereto included in the Company’s Annual Report on Form 10-K as of and for the year ended December 31, 2012. | ||
In the opinion of management, the interim financial statements include all adjustments, consisting of normal recurring accruals, necessary for a fair presentation of the financial position, results of operations and cash flows in the Consolidated Financial Statements. The unaudited operating results for the periods presented may not be indicative of annual results. | ||
Segment Reporting | ||
Based on an analysis performed by the Company, management has determined that the Company has only one operating segment, which is commercial banking. The chief operating decision-maker uses consolidated results to make operating and strategic decisions and therefore, the Company is not required to disclose additional segment information. | ||
Use of Estimates | ||
The financial statements are prepared in accordance with GAAP, which require management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates. | ||
New Accounting Pronouncements | ||
The Financial Accounting Standards Board (“FASB”) amended the Comprehensive Income topic of the Accounting Standards Codification (“ASC”) in February 2013. The amendments address reporting of amounts reclassified out of accumulated other comprehensive income. Specifically, the amendments do not change the current requirements for reporting net income or other comprehensive income in financial statements. However, the amendments do require an entity to provide information about the amounts reclassified out of accumulated other comprehensive income by component. In addition, in certain circumstances an entity is required to present, either on the face of the statement where net income is presented or in the notes, significant amounts reclassified out of accumulated other comprehensive income by the respective line items of net income. The amendments were effective for the Company on a prospective basis for reporting periods beginning after December 15, 2012. The adoption of these amendments did not have a material effect on the consolidated financial statements of the Company, although new disclosures are included in these consolidated financial statements. | ||
On April 22, 2013, the FASB issued guidance addressing application of the liquidation basis of accounting. The guidance is intended to clarify when an entity should apply the liquidation basis of accounting. In addition, the guidance provides principles for the recognition and measurement of assets and liabilities and requirements for financial statements prepared using the liquidation basis of accounting. The amendments will be effective for entities that determine liquidation is imminent during annual reporting periods beginning after December 15, 2013, and interim reporting periods therein and those requirements should be applied prospectively from the day that liquidation becomes imminent. Early adoption is permitted. The Company does not expect these amendments to have any effect on its financial statements. | ||
Other accounting standards that have been issued or proposed by the FASB or other standards-setting bodies are not expected to have a material impact on the Company’s financial position, results of operations or cash flows. |
INVESTMENT_SECURITIES
INVESTMENT SECURITIES | 9 Months Ended | ||||||||||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||||||||||
Investment Securities | ' | ||||||||||||||||||||||||
INVESTMENT SECURITIES | ' | ||||||||||||||||||||||||
2 | INVESTMENT SECURITIES | ||||||||||||||||||||||||
The main objectives of our investment strategy are to provide a source of liquidity while managing our interest rate risk, and to generate an adequate level of interest income without taking undue risks. Our investment policy permits investments in various types of securities, certificates of deposits and federal funds sold in compliance with various restrictions in the policy. As of September 30, 2013 and December 31, 2012, all investment securities were classified as available-for-sale. | |||||||||||||||||||||||||
Our available-for-sale securities totaled $57.9 million and $60.8 million as of September 30, 2013 and December 31, 2012, respectively. Securities with a fair value of $1.0 million were pledged to the Federal Reserve Bank of Richmond (“Federal Reserve Bank”) and an additional $2.7 million and $16.3 million in investments were pledged to public housing authorities in North Carolina and the North Carolina Department of State Treasurer, respectively, as collateral for public deposits at September 30, 2013. Securities with a fair value of $1.1 million were pledged to the Federal Reserve Bank and an additional $4.9 million and $2.6 million in investments were pledged to public housing authorities in North Carolina and the North Carolina Department of State Treasurer, respectively, as collateral for public deposits at December 31, 2012. Our investment portfolio consists of the following securities: | |||||||||||||||||||||||||
· | U.S. government agency securities, | ||||||||||||||||||||||||
· | U.S. government sponsored residential mortgage backed securities (“MBS”), and | ||||||||||||||||||||||||
· | Municipal securities (“Municipals”). | ||||||||||||||||||||||||
The amortized cost, gross unrealized gains and losses and fair values of investment securities at September 30, 2013 and December 31, 2012 were: | |||||||||||||||||||||||||
(Dollars in thousands) | Amortized | Gross | Gross | Fair Value | |||||||||||||||||||||
Cost | Unrealized | Unrealized | |||||||||||||||||||||||
Gains | Losses | ||||||||||||||||||||||||
(Unaudited) | |||||||||||||||||||||||||
30-Sep-13 | |||||||||||||||||||||||||
US government agencies | $ | 5,000 | $ | 7 | $ | (125 | ) | $ | 4,882 | ||||||||||||||||
Government sponsored MBS | |||||||||||||||||||||||||
Residential | 51,733 | 191 | (345 | ) | 51,579 | ||||||||||||||||||||
Municipal securities | |||||||||||||||||||||||||
North Carolina | 1,488 | 28 | (39 | ) | 1,477 | ||||||||||||||||||||
Total at September 30, 2013 | $ | 58,221 | $ | 226 | $ | (509 | ) | $ | 57,938 | ||||||||||||||||
31-Dec-12 | |||||||||||||||||||||||||
US government agencies | $ | 1,322 | $ | 5 | $ | — | $ | 1,327 | |||||||||||||||||
Government sponsored MBS | |||||||||||||||||||||||||
Residential | 57,333 | 627 | (29 | ) | 57,931 | ||||||||||||||||||||
North Carolina | 1,497 | 56 | — | 1,553 | |||||||||||||||||||||
Total at December 31, 2012 | $ | 60,152 | $ | 688 | $ | (29 | ) | $ | 60,811 | ||||||||||||||||
Sales and calls of securities available-for-sale for the three months ended September 30, resulted in aggregate gross realized gains of $75 thousand, and gross realized losses of $8 thousand during 2012 compared to none during the comparable period in 2013. Sales and calls of securities available-for-sale for the nine months ended September 30, resulted in aggregate gross realized gains of $264 thousand and gross realized losses of $8 thousand during 2012 compared to none during the comparable period in 2013. | |||||||||||||||||||||||||
The amortized cost and estimated market values of securities as of September 30, 2013 and December 31, 2012 by contractual maturities are shown below. Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. MBS, which are not due at a single maturity date, are grouped based upon the final payment date. MBS may mature earlier because of principal prepayments. | |||||||||||||||||||||||||
(Dollars in thousands) | As of September 30, 2013 | ||||||||||||||||||||||||
(Unaudited) | Fair Value | Amortized Cost | |||||||||||||||||||||||
US government agencies | |||||||||||||||||||||||||
Due after one year through five years | $ | 3,004 | $ | 3,000 | |||||||||||||||||||||
Due after five years through ten years | 1,878 | 2,000 | |||||||||||||||||||||||
Total US government agencies | $ | 4,882 | $ | 5,000 | |||||||||||||||||||||
Government sponsored MBS | |||||||||||||||||||||||||
Residential | |||||||||||||||||||||||||
Due within one year | $ | 15,830 | $ | 15,882 | |||||||||||||||||||||
Due after one year through five years | 24,659 | 24,733 | |||||||||||||||||||||||
Due after five years through ten years | 7,484 | 7,513 | |||||||||||||||||||||||
Due after ten years | 3,606 | 3,605 | |||||||||||||||||||||||
Total government sponsored MBS | $ | 51,579 | $ | 51,733 | |||||||||||||||||||||
Municipal bonds | |||||||||||||||||||||||||
North Carolina | |||||||||||||||||||||||||
Due within one year | $ | 476 | $ | 466 | |||||||||||||||||||||
Due after one year through five years | 441 | 423 | |||||||||||||||||||||||
Due after five years through ten years | 560 | 599 | |||||||||||||||||||||||
Total North Carolina municipal bonds | $ | 1,477 | $ | 1,488 | |||||||||||||||||||||
(Dollars in thousands) | As of December 31, 2012 | ||||||||||||||||||||||||
Fair Value | Amortized Cost | ||||||||||||||||||||||||
US government agencies | |||||||||||||||||||||||||
Due within one year | $ | 1,005 | $ | 1,000 | |||||||||||||||||||||
Due after one year through five years | 322 | 322 | |||||||||||||||||||||||
Total US government agencies | $ | 1,327 | $ | 1,322 | |||||||||||||||||||||
Government sponsored MBS | |||||||||||||||||||||||||
Residential | |||||||||||||||||||||||||
Due within one year | |||||||||||||||||||||||||
Due after one year through five years | $ | 135 | $ | 126 | |||||||||||||||||||||
Due after five years through ten years | 171 | 161 | |||||||||||||||||||||||
Due after ten years | 57,625 | 57,046 | |||||||||||||||||||||||
Total government sponsored MBS | $ | 57,931 | $ | 57,333 | |||||||||||||||||||||
Municipal bonds | |||||||||||||||||||||||||
North Carolina | |||||||||||||||||||||||||
Due within one year | $ | 488 | $ | 466 | |||||||||||||||||||||
Due after one year through five years | 458 | 425 | |||||||||||||||||||||||
Due after five years through ten years | 607 | 606 | |||||||||||||||||||||||
Total North Carolina municipal bonds | $ | 1,553 | $ | 1,497 | |||||||||||||||||||||
All securities owned as of September 30, 2013 and December 31, 2012 are investment grade. The unrealized losses were attributable to changes in market interest rates. The Company evaluates securities for other than temporary impairment on a quarterly basis. Consideration is given to the financial condition and near-term prospects of the issuer, the length of time and extent to which the fair value has been less than cost, and our intent and ability to retain our investment in the issuer for a period of time sufficient to allow for any anticipated recovery in fair value. Based on these evaluations, the Company did not deem any securities to be impaired during 2012 or the first nine months of 2013. | |||||||||||||||||||||||||
As of September 30, 2013 and December 31, 2012, the Company held 53 and 11 investment positions, respectively, with unrealized losses of $509 thousand and $29 thousand, respectively. These investments were in U.S. government agencies, government sponsored MBS and municipal bonds. In analyzing an issuer’s financial condition, management considers whether the securities are issued by the federal government or its agencies, whether downgrades by bond rating agencies have occurred, and industry analysts’ reports. Management had determined that all declines in market values of available-for-sale securities are not other-than-temporary, and will not likely be required to sell. | |||||||||||||||||||||||||
As of September 30, 2013 and December 31, 2012, the fair value of securities with gross unrealized losses by length of time that the individual securities have been in an unrealized loss position is as follows: | |||||||||||||||||||||||||
(Dollars in thousands) | Less Than 12 Months | 12 Months or Greater | Total | ||||||||||||||||||||||
(Unaudited) | Fair Value | Unrealized | Fair Value | Unrealized | Fair Value | Unrealized | |||||||||||||||||||
Losses | Losses | Losses | |||||||||||||||||||||||
30-Sep-13 | |||||||||||||||||||||||||
US government agencies | $ | 2,875 | $ | (125 | ) | $ | — | $ | — | $ | 2,875 | $ | (125 | ) | |||||||||||
Government sponsored MBS | |||||||||||||||||||||||||
Residential | 34,354 | (345 | ) | 21 | — | 34,375 | (345 | ) | |||||||||||||||||
Municipal securities | |||||||||||||||||||||||||
North Carolina | 560 | (39 | ) | — | — | 560 | (39 | ) | |||||||||||||||||
Total at September 30, 2013 | $ | 37,789 | $ | (509 | ) | $ | 21 | $ | — | $ | 37,810 | $ | (509 | ) | |||||||||||
(Dollars in thousands) | Less Than 12 Months | 12 Months or Greater | Total | ||||||||||||||||||||||
Fair Value | Unrealized | Fair Value | Unrealized | Fair Value | Unrealized | ||||||||||||||||||||
Losses | Losses | Losses | |||||||||||||||||||||||
31-Dec-12 | |||||||||||||||||||||||||
Government sponsored MBS | |||||||||||||||||||||||||
Residential | $ | 8,027 | $ | (29 | ) | $ | 21 | $ | — | $ | 8,048 | $ | (29 | ) | |||||||||||
Total at December 31, 2012 | $ | 8,027 | $ | (29 | ) | $ | 21 | $ | — | $ | 8,048 | $ | (29 | ) | |||||||||||
The Company has stock in the Federal Home Loan Bank of Atlanta ("FHLB"), classified on the Consolidated Balance Sheets as Other invested assets, which is evaluated on a quarterly basis for other-than-temporary impairment. The FHLB has been issuing dividends and repurchasing excess stock on a pro-rata basis for several quarters. The Company believes that its investment in FHLB stock is not impaired. | |||||||||||||||||||||||||
FHLB_STOCK
FHLB STOCK | 9 Months Ended | |
Sep. 30, 2013 | ||
Fhlb Stock | ' | |
FHLB STOCK | ' | |
3 | FHLB STOCK | |
To be a member of the FHLB System, the Bank is required to maintain an investment in capital stock of the FHLB in an amount equal to 0.15% of its total assets as of December 31 of the prior year (up to a maximum of $20.0 million and $26.0 million at September 30, 2013 and December 31, 2012, respectively), plus 4.5% of its outstanding FHLB advances. The carrying value of FHLB stock, which is included in Other invested assets, as of September 30, 2013 and December 31, 2012 was $389 thousand and $488 thousand, respectively. No ready market exists for the FHLB stock, and it has no quoted market value; however, management believes that the cost approximates the market value as of September 30, 2013 and December 31, 2012, as redemption has historically been at cost. The FHLB, of which the Bank is a member, has been impacted by the Recession that began in 2008. Management has reviewed its investment in FHLB stock for impairment and does not believe it is impaired as of September 30, 2013 or December 31, 2012. |
RECONCILIATIONS_OF_BASIC_AND_D
RECONCILIATIONS OF BASIC AND DILUTED EARNINGS PER SHARE | 9 Months Ended | |
Sep. 30, 2013 | ||
Reconciliations Of Basic And Diluted Earnings Per Share | ' | |
RECONCILIATIONS OF BASIC AND DILUTED EARNINGS (LOSS) PER SHARE ("EPS") | ' | |
4 | RECONCILIATIONS OF BASIC AND DILUTED EARNINGS (LOSS) PER SHARE ("EPS") | |
Basic EPS is computed by dividing net income (loss) available to common stockholders by the weighted average number shares of common stock outstanding for the period. Basic EPS excludes the dilutive effect that could occur if any options or warrants to purchase shares of common stock were exercised. Diluted EPS is computed by dividing net income (loss) available to common stockholders by the sum of the weighted average number of shares of common stock outstanding for the period plus the number of additional shares of common stock that would have been outstanding if the potentially dilutive common shares had been issued. There are no stock options or warrants outstanding. |
ACCUMULATED_OTHER_COMPREHENSIV
ACCUMULATED OTHER COMPREHENSIVE INCOME | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Cash paid during period for: [Abstract] | ' | ||||||||||||||||
ACCUMULATED OTHER COMPREHENSIVE INCOME | ' | ||||||||||||||||
5 | ACCUMULATED OTHER COMPREHENSIVE INCOME | ||||||||||||||||
Comprehensive income includes net income and all other changes to the Company's equity, with the exception of transactions with stockholders. The Company's other comprehensive income and accumulated other comprehensive income are comprised of unrealized gains and losses on certain investments in debt securities and defined benefit plan adjustments. | |||||||||||||||||
CHANGES IN ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) BY COMPONENT | |||||||||||||||||
For The Three And Nine Months Ended September 30, 2013 | |||||||||||||||||
(Dollars in thousands) | |||||||||||||||||
(Unaudited) | |||||||||||||||||
Unrealized | Defined | Total | |||||||||||||||
Gains and | Benefit | ||||||||||||||||
Losses on | Pension Items | ||||||||||||||||
Available-for- | |||||||||||||||||
Sale | |||||||||||||||||
Securities | |||||||||||||||||
Balance as of June 30, 2013 | $ | (8 | ) | $ | (1,834 | ) | $ | (1,842 | ) | ||||||||
Other comprehensive loss before reclassifications | (169 | ) | — | (169 | ) | ||||||||||||
Amounts reclassified from acumulated other comprehensive loss | — | — | — | ||||||||||||||
Net current-period other comprehensive loss | (169 | ) | — | (169 | ) | ||||||||||||
Balance as of September 30, 2013 | $ | (177 | ) | $ | (1,834 | ) | $ | (2,011 | ) | ||||||||
Balance as of December 31, 2012 | $ | 426 | $ | (1,834 | ) | $ | (1,408 | ) | |||||||||
Other comprehensive loss before reclassifications | (603 | ) | — | (603 | ) | ||||||||||||
Amounts reclassified from acumulated other comprehensive loss | — | — | — | ||||||||||||||
Net current-period other comprehensive loss | (603 | ) | — | (603 | ) | ||||||||||||
Balance as of September 30, 2013 | $ | (177 | ) | $ | (1,834 | ) | $ | (2,011 | ) | ||||||||
All amounts are net of tax. |
LOANS_AND_ALLOWANCE_FOR_LOAN_L
LOANS AND ALLOWANCE FOR LOAN LOSSES | 9 Months Ended | ||||||||||||||||||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||||||||||||||||||
Loans And Allowance For Loan Losses | ' | ||||||||||||||||||||||||||||||||
LOANS AND ALLOWANCE FOR LOAN LOSSES | ' | ||||||||||||||||||||||||||||||||
6 | LOANS AND ALLOWANCE FOR LOAN LOSSES | ||||||||||||||||||||||||||||||||
The activity in the Allowance for Loan Losses (“ALLL”) for the three and nine months ended September 30, 2013 and 2012 and related asset balances at September 30, 2013 and December 31, 2012 is summarized as follows: | |||||||||||||||||||||||||||||||||
For the Three Months Ended September 30, 2013 | |||||||||||||||||||||||||||||||||
Faith- | |||||||||||||||||||||||||||||||||
Based | Residential | ||||||||||||||||||||||||||||||||
Commercial | Non- | Real | Other | ||||||||||||||||||||||||||||||
(Dollars in thousands) | Commercial | Real Estate | Profit | Estate | Consumer | Loans | Unallocated | Total | |||||||||||||||||||||||||
ALLL: | |||||||||||||||||||||||||||||||||
Beginning of quarter balance | $ | 241 | $ | 806 | $ | 1,278 | $ | 831 | $ | 22 | $ | 43 | $ | 13 | $ | 3,234 | |||||||||||||||||
Charge-offs | — | — | — | (40 | ) | (1 | ) | (4 | ) | — | (45 | ) | |||||||||||||||||||||
Recoveries | — | 25 | — | 4 | 6 | 3 | — | 38 | |||||||||||||||||||||||||
Provision for loan losses | 203 | 52 | (170 | ) | (57 | ) | (8 | ) | 3 | (13 | ) | 10 | |||||||||||||||||||||
Balance at September 30, 2013 | $ | 444 | $ | 883 | $ | 1,108 | $ | 738 | $ | 19 | $ | 45 | $ | — | $ | 3,237 | |||||||||||||||||
For the Three Months Ended September 30, 2012 | |||||||||||||||||||||||||||||||||
Faith- | |||||||||||||||||||||||||||||||||
Based | Residential | ||||||||||||||||||||||||||||||||
Commercial | Non- | Real | Other | ||||||||||||||||||||||||||||||
(Dollars in thousands) | Commercial | Real Estate | Profit | Estate | Consumer | Loans | Unallocated | Total | |||||||||||||||||||||||||
ALLL: | |||||||||||||||||||||||||||||||||
Beginning of quarter balance | $ | 61 | $ | 1,187 | $ | 1,091 | $ | 1,243 | $ | 46 | $ | 51 | $ | — | $ | 3,679 | |||||||||||||||||
Charge-offs | — | — | — | (303 | ) | — | (8 | ) | — | (311 | ) | ||||||||||||||||||||||
Recoveries | — | — | — | 4 | 4 | — | — | 8 | |||||||||||||||||||||||||
Provision for loan losses | (36 | ) | (18 | ) | (60 | ) | 230 | 2 | 4 | — | 122 | ||||||||||||||||||||||
Balance at September 30, 2012 | $ | 25 | $ | 1,169 | $ | 1,031 | $ | 1,174 | $ | 52 | $ | 47 | $ | — | $ | 3,498 | |||||||||||||||||
For the Nine Months Ended September 30, 2013 | |||||||||||||||||||||||||||||||||
Faith- | |||||||||||||||||||||||||||||||||
Based | Residential | ||||||||||||||||||||||||||||||||
Commercial | Non- | Real | Other | ||||||||||||||||||||||||||||||
(Dollars in thousands) | Commercial | Real Estate | Profit | Estate | Consumer | Loans | Unallocated | Total | |||||||||||||||||||||||||
ALLL: | |||||||||||||||||||||||||||||||||
Beginning of year balance | $ | 90 | $ | 881 | $ | 1,246 | $ | 937 | $ | 30 | $ | 54 | $ | 261 | $ | 3,499 | |||||||||||||||||
Charge-offs | — | (237 | ) | — | (73 | ) | (3 | ) | (14 | ) | — | (327 | ) | ||||||||||||||||||||
Recoveries | — | 27 | — | 12 | 7 | 9 | — | 55 | |||||||||||||||||||||||||
Provision for loan losses | 354 | 212 | (138 | ) | (138 | ) | (15 | ) | (4 | ) | (261 | ) | 10 | ||||||||||||||||||||
Balance at September 30, 2013 | $ | 444 | $ | 883 | $ | 1,108 | $ | 738 | $ | 19 | $ | 45 | $ | — | $ | 3,237 | |||||||||||||||||
For the Nine Months Ended September 30, 2012 | |||||||||||||||||||||||||||||||||
Faith- | |||||||||||||||||||||||||||||||||
Based | Residential | ||||||||||||||||||||||||||||||||
Commercial | Non- | Real | Other | ||||||||||||||||||||||||||||||
(Dollars in thousands) | Commercial | Real Estate | Profit | Estate | Consumer | Loans | Unallocated | Total | |||||||||||||||||||||||||
ALLL: | |||||||||||||||||||||||||||||||||
Beginning of year balance | $ | 348 | $ | 971 | $ | 1,128 | $ | 1,299 | $ | 62 | $ | 42 | $ | — | $ | 3,850 | |||||||||||||||||
Charge-offs | — | (56 | ) | — | (539 | ) | (1 | ) | (26 | ) | — | (622 | ) | ||||||||||||||||||||
Recoveries | — | 1 | 93 | 1 | 9 | — | 104 | ||||||||||||||||||||||||||
Provision for loan losses | (323 | ) | 253 | (97 | ) | 321 | (10 | ) | 22 | — | 166 | ||||||||||||||||||||||
Balance at September 30, 2012 | $ | 25 | $ | 1,169 | $ | 1,031 | $ | 1,174 | $ | 52 | $ | 47 | $ | — | $ | 3,498 | |||||||||||||||||
30-Sep-13 | |||||||||||||||||||||||||||||||||
Faith | |||||||||||||||||||||||||||||||||
Based | |||||||||||||||||||||||||||||||||
Commercial | Non- | Residential | Other | ||||||||||||||||||||||||||||||
(Dollars in thousands) | Commercial | Real Estate | Profit | Real Estate | Consumer | Loans | Unallocated | Total | |||||||||||||||||||||||||
ALLL: | |||||||||||||||||||||||||||||||||
Ending ALLL balance attributable to loans: | |||||||||||||||||||||||||||||||||
Individually evaluated for impairment | $ | — | $ | — | $ | 87 | $ | 265 | $ | — | $ | — | $ | — | $ | 352 | |||||||||||||||||
Collectively evaluated for impairment | 444 | 883 | 1,021 | 473 | 19 | 45 | — | 2,885 | |||||||||||||||||||||||||
Total ending ALLL balance | $ | 444 | $ | 883 | $ | 1,108 | $ | 738 | $ | 19 | $ | 45 | $ | — | $ | 3,237 | |||||||||||||||||
Loans: | |||||||||||||||||||||||||||||||||
Loans individually evaluated for impairment | $ | — | $ | 8,476 | $ | 17,052 | $ | 4,051 | $ | 12 | $ | — | $ | — | $ | 29,591 | |||||||||||||||||
Loans collectively evaluated for imapirment | 12,658 | 46,381 | 68,875 | 26,024 | 1,200 | 2,427 | — | 157,565 | |||||||||||||||||||||||||
Total ending loans balance | $ | 12,658 | $ | 54,857 | $ | 85,927 | $ | 30,075 | $ | 1,212 | $ | 2,427 | $ | — | $ | 187,156 | |||||||||||||||||
31-Dec-12 | |||||||||||||||||||||||||||||||||
Faith | |||||||||||||||||||||||||||||||||
Based | |||||||||||||||||||||||||||||||||
Commercial | Non- | Residential | Other | ||||||||||||||||||||||||||||||
(Dollars in thousands) | Commercial | Real Estate | Profit | Real Estate | Consumer | Loans | Unallocated | Total | |||||||||||||||||||||||||
ALLL: | |||||||||||||||||||||||||||||||||
Ending ALLL balance attributable to loans: | |||||||||||||||||||||||||||||||||
Individually evaluated for impairment | $ | — | $ | 87 | $ | 44 | $ | 349 | $ | — | $ | — | $ | — | $ | 480 | |||||||||||||||||
Collectively evaluated for impairment | 90 | 794 | 1,202 | 588 | 30 | 54 | 261 | 3,019 | |||||||||||||||||||||||||
Total ending ALLL balance | $ | 90 | $ | 881 | $ | 1,246 | $ | 937 | $ | 30 | $ | 54 | $ | 261 | $ | 3,499 | |||||||||||||||||
Loans: | |||||||||||||||||||||||||||||||||
Loans individually evaluated for impairment | $ | — | $ | 4,837 | $ | 14,907 | $ | 2,443 | $ | 16 | $ | — | $ | — | $ | 22,203 | |||||||||||||||||
Loans collectively evaluated for impairment | 3,282 | 43,332 | 70,990 | 31,331 | 1,330 | 2,754 | — | 153,019 | |||||||||||||||||||||||||
Total ending loans balance | $ | 3,282 | $ | 48,169 | $ | 85,897 | $ | 33,774 | $ | 1,346 | $ | 2,754 | $ | — | $ | 175,222 | |||||||||||||||||
The Bank experienced $7 thousand and $303 thousand in net charge-offs for the three months ended September 30, 2013 and 2012, respectively. Annualized net charge-offs as a percent of average loan balances outstanding totaled .02% and .66% during the three month periods ended September 30, 2013 and 2012, respectively. The Bank experienced $272 thousand in net charge-offs for the nine months ended September 30, 2013 compared to $518 thousand in net loan charge-offs for the nine months ended September 30, 2012. Annualized net charge-offs as a percent of average loan balances outstanding totaled .20% and .38% during the nine month periods ended September 30, 2013 and 2012, respectively, and 0.27% for the year ended December 31, 2012. | |||||||||||||||||||||||||||||||||
Loans— Loans are stated at the amount of unpaid principal, net of deferred loan origination fees and costs. Nonrefundable loan fees, net of direct costs, associated with the origination or acquisition of loans are deferred and recognized as an adjustment of the loan yield over the life of the respective loan using the effective interest method. Loans (net) are reduced by the ALLL. Interest on loans is accrued on the daily balances of unpaid principal outstanding. Interest income is accrued and credited to income only if deemed collectible. Other loan fees and charges, representing service charges for the prepayment of loans, for delinquent payments, or for miscellaneous loan services, are recorded in income when collected. | |||||||||||||||||||||||||||||||||
A portfolio segment is defined as the level at which an entity develops and documents a systematic methodology to determine its ALLL. The composition of the loan portfolio, net of deferred fees and costs, by loan classification as of September 30, 2013 and December 31, 2012 was as follows: | |||||||||||||||||||||||||||||||||
(Dollars in thousands) | 30-Sep-13 | 31-Dec-12 | |||||||||||||||||||||||||||||||
Commercial | $ | 12,658 | $ | 3,282 | |||||||||||||||||||||||||||||
Commercial real estate: | |||||||||||||||||||||||||||||||||
Construction | 4,359 | 3,621 | |||||||||||||||||||||||||||||||
Owner occupied | 21,649 | 18,377 | |||||||||||||||||||||||||||||||
Other | 28,849 | 26,171 | |||||||||||||||||||||||||||||||
Faith-based non-profit | |||||||||||||||||||||||||||||||||
Construction | — | 2,344 | |||||||||||||||||||||||||||||||
Owner Occupied | 79,447 | 76,418 | |||||||||||||||||||||||||||||||
Other | 6,480 | 7,135 | |||||||||||||||||||||||||||||||
Residential real estate: | |||||||||||||||||||||||||||||||||
First mortgage | 23,159 | 24,702 | |||||||||||||||||||||||||||||||
Multifamily | 3,776 | 5,828 | |||||||||||||||||||||||||||||||
Home equity | 3,140 | 3,161 | |||||||||||||||||||||||||||||||
Construction | — | 83 | |||||||||||||||||||||||||||||||
Consumer | 1,212 | 1,346 | |||||||||||||||||||||||||||||||
Other loans | 2,427 | 2,754 | |||||||||||||||||||||||||||||||
Loans, net of deferred fees | 187,156 | 175,222 | |||||||||||||||||||||||||||||||
ALLL | (3,237 | ) | (3,499 | ) | |||||||||||||||||||||||||||||
Loans, net of ALLL | $ | 183,919 | $ | 171,723 | |||||||||||||||||||||||||||||
The Bank has a concentration of loans to faith-based non-profit organizations, in which the Bank has specialized lending experience. As of September 30, 2013, the percentage of loans in this niche, which included construction, real estate secured, and lines of credit, comprised approximately 45.91% of the total loan portfolio and the reserve for these loans was 34.23% of the total allowance. Historically the Bank has experienced low levels of loan losses in this niche; however, repayment of these loans is generally dependent on voluntary contributions which some have been adversely affected by the recent recession. | |||||||||||||||||||||||||||||||||
Non-Performing Loans and Leases - Generally, all classes of loans and leases are placed on non-accrual status upon becoming contractually past due 90 days or more as to principal or interest (unless loans are adequately secured by collateral, are in the process of collection, and are reasonably expected to result in repayment), or where substantial doubt about full repayment of principal or interest is evident. | |||||||||||||||||||||||||||||||||
When a loan is placed on non-accrual status, regardless of class, the accrued and unpaid interest receivable is reversed and the loan is accounted for on the cash or cost recovery method until qualifying for return to accrual status. All payments received on non-accrual loans and leases are applied against the principal balance of the loan or lease. Loans may be returned to accrual status when all principal and interest amounts contractually due (including any arrearages) are reasonably assured of repayment within a reasonable period, the borrower has demonstrated payment performance for a minimum of six months in accordance with the original or revised contractual terms of the loan, and when doubt about repayment is resolved. | |||||||||||||||||||||||||||||||||
Generally, for all classes of loans and leases, a charge-off is recorded when it is probable that a loss has been incurred and when it is possible to determine a reasonable estimate of the loss. For all classes of commercial loans and leases, a charge-off is determined on a subjective basis after due consideration of the debtor's prospects for repayment and the fair value of collateral. For closed-end consumer loans, the entire outstanding balance of the loan is charged-off during the month that the loan becomes 120 days past due as to principal or interest. Consumer loans with non-real estate collateral are written down to the value of the collateral, less estimated costs to sell, if repossession of collateral is assured and in process. For residential mortgage and home equity loan classes, a partial charge-off is recorded at 120 days past due as to principal or interest for the amount that the loan balance exceeds the fair value of the collateral less estimated costs to sell. | |||||||||||||||||||||||||||||||||
Impaired Loans - A loan is considered impaired when, based on current information and events, it is probable that the Company will not be able to collect all amounts due from the borrower in accordance with the original contractual terms of the loan, including scheduled interest payments. Impaired loans include all classes of commercial non-accruing loans and Troubled Debt Restructurings ("TDRs"). Impaired loans exclude smaller balance homogeneous loans (consumer and small business non-accruing loans) not in the process of foreclosure that are collectively evaluated for impairment. | |||||||||||||||||||||||||||||||||
For all classes of commercial loans, a quarterly evaluation of specific individual commercial borrowers with identified weaknesses is performed to identify impaired loans. The identification of specific borrowers for review is based on a review of non-accrual loans as well as those loans specifically identified by management as exhibiting above average levels of risk. | |||||||||||||||||||||||||||||||||
When a loan has been identified as being impaired, the amount of impairment is measured based on the present value of expected future cash flows discounted at the loan's effective interest rate, the loan's observable market price, or the estimated fair value of the collateral, less any selling costs, if the loan is collateral-dependent. If the measurement of the impaired loan is less than the recorded investment in the loan (net of deferred loan fees or costs and unamortized premiums or discounts), impairment is recognized by creating or adjusting an existing allocation of the ALLL, or by recording a partial charge-off of the loan to its estimated fair value. Interest payments made on impaired loans are typically applied to principal unless collectability of the principal amount is reasonably assured, in which case interest income may be accrued or recognized on a cash basis. | |||||||||||||||||||||||||||||||||
Income Recognition on Impaired and Non-accrual Loans - Loans, including impaired loans, are generally classified as non-accrual if they are past due as to maturity, or payment of principal or interest for a period of more than 90 days, unless such loans are well secured and in the process of collection. If a loan or a portion of a loan is classified as doubtful or is partially charged off, the loan is generally classified as non-accrual. Loans that are on a current payment status or past due less than 90 days may also be classified as non-accrual if full repayment of principal and/or interest is in doubt. | |||||||||||||||||||||||||||||||||
Loans may be returned to accrual status when all principal and interest amounts contractually due (including arrearages) are reasonably assured of repayment within a reasonable period of time, and the borrower has demonstrated payment performance for a minimum of six months in accordance with the contractual terms involving payments of cash or cash equivalents. During the non-accrual period, all payments received will be applied to principal. After a loan is returned to accruing status, foregone interest will be accreted to interest income on a pro-rata basis over the remaining term of the loan if full repayment of principal and interest is reasonably assured. | |||||||||||||||||||||||||||||||||
In the case where a non-accrual loan had been partially charged off, recognition of interest on a cash basis is limited to that which would have been recognized on the remaining loan balance at the contractual interest rate. Receipts in excess of that amount are recorded as recoveries to the ALLL until prior charged off balances have been fully recovered. | |||||||||||||||||||||||||||||||||
The following tables show past due loans at September 30, 2013 and December 31, 2012: | |||||||||||||||||||||||||||||||||
30-Sep-13 | 90 Days | ||||||||||||||||||||||||||||||||
30-59 Days | 60-89 Days | Or More | Total Past | ||||||||||||||||||||||||||||||
(Dollars in thousands) | Past Due | Past Due | Past Due | Due | Current | Total | |||||||||||||||||||||||||||
Commercial | $ | 4 | $ | 5 | $ | 2 | $ | 11 | $ | 12,647 | $ | 12,658 | |||||||||||||||||||||
Commercial real estate: | |||||||||||||||||||||||||||||||||
Construction | — | — | — | — | 4,359 | 4,359 | |||||||||||||||||||||||||||
Owner occupied | — | — | 129 | 129 | 21,520 | 21,649 | |||||||||||||||||||||||||||
Other | — | — | 572 | 572 | 28,277 | 28,849 | |||||||||||||||||||||||||||
Faith-based non-profit | |||||||||||||||||||||||||||||||||
Construction | — | — | — | — | — | — | |||||||||||||||||||||||||||
Owner Occupied | 613 | — | — | 613 | 78,834 | 79,447 | |||||||||||||||||||||||||||
Other | — | — | — | — | 6,480 | 6,480 | |||||||||||||||||||||||||||
Residential real estate: | |||||||||||||||||||||||||||||||||
First mortgage | 75 | — | 1,148 | 1,223 | 21,936 | 23,159 | |||||||||||||||||||||||||||
Multifamily | — | — | — | — | 3,776 | 3,776 | |||||||||||||||||||||||||||
Home equity | 256 | 94 | 19 | 369 | 2,771 | 3,140 | |||||||||||||||||||||||||||
Construction | — | — | — | — | — | — | |||||||||||||||||||||||||||
Consumer | 13 | — | — | 13 | 1,199 | 1,212 | |||||||||||||||||||||||||||
Other loans | — | — | — | — | 2,427 | 2,427 | |||||||||||||||||||||||||||
Total | $ | 961 | $ | 99 | $ | 1,870 | $ | 2,930 | $ | 184,226 | $ | 187,156 | |||||||||||||||||||||
31-Dec-12 | 90 Days | ||||||||||||||||||||||||||||||||
30-59 Days | 60-89 Days | Or More | Total Past | ||||||||||||||||||||||||||||||
(Dollars in thousands) | Past Due | Past Due | Past Due | Due | Current | Total | |||||||||||||||||||||||||||
Commercial | $ | — | $ | 353 | $ | — | $ | 353 | $ | 2,929 | $ | 3,282 | |||||||||||||||||||||
Commercial real estate: | |||||||||||||||||||||||||||||||||
Construction | — | — | — | — | 3,621 | 3,621 | |||||||||||||||||||||||||||
Owner occupied | — | — | 263 | 263 | 18,114 | 18,377 | |||||||||||||||||||||||||||
Other | 1,570 | 856 | 400 | 2,826 | 23,345 | 26,171 | |||||||||||||||||||||||||||
Faith-based non-profit | |||||||||||||||||||||||||||||||||
Construction | — | — | — | — | 2,344 | 2,344 | |||||||||||||||||||||||||||
Owner Occupied | 1,845 | — | 661 | 2,506 | 73,912 | 76,418 | |||||||||||||||||||||||||||
Other | — | — | — | — | 7,135 | 7,135 | |||||||||||||||||||||||||||
Residential real estate: | |||||||||||||||||||||||||||||||||
First mortgage | 787 | 548 | 2,812 | 4,147 | 20,555 | 24,702 | |||||||||||||||||||||||||||
Multifamily | — | — | — | — | 5,828 | 5,828 | |||||||||||||||||||||||||||
Home equity | 122 | 120 | 108 | 350 | 2,811 | 3,161 | |||||||||||||||||||||||||||
Construction | — | — | — | — | 83 | 83 | |||||||||||||||||||||||||||
Consumer | 8 | 9 | — | 17 | 1,329 | 1,346 | |||||||||||||||||||||||||||
Other loans | — | — | — | — | 2,754 | 2,754 | |||||||||||||||||||||||||||
Total | $ | 4,332 | $ | 1,886 | $ | 4,244 | $ | 10,462 | $ | 164,760 | $ | 175,222 | |||||||||||||||||||||
At September 30, 2013 and December 31, 2012, the total recorded investment in impaired loans amounted to $29.7 million and $24.1 million, respectively. | |||||||||||||||||||||||||||||||||
The recorded investment and related information for impaired loans is summarized as follows for September 30, 2013, September 30, 2012 and December 31, 2012: | |||||||||||||||||||||||||||||||||
30-Sep-13 | |||||||||||||||||||||||||||||||||
At end of period | For Nine Months Ended | For Three Months Ended | |||||||||||||||||||||||||||||||
Unpaid | Interest | Average | Interest | Average | |||||||||||||||||||||||||||||
Principal | Recorded | ALLL | Income | Recorded | Income | Recorded | |||||||||||||||||||||||||||
(Dollars in thousands) | Balance | Investment | Allocated | Recognized | Investment | Recognized | Investment | ||||||||||||||||||||||||||
With no related allowance recorded: | |||||||||||||||||||||||||||||||||
Commercial | $ | — | $ | — | $ | — | $ | — | $ | 98 | $ | — | $ | — | |||||||||||||||||||
Commercial real estate: | |||||||||||||||||||||||||||||||||
Construction | 362 | 364 | — | 21 | 276 | 10 | 274 | ||||||||||||||||||||||||||
Owner occupied | 3,418 | 3,184 | — | 84 | 706 | 67 | 1,067 | ||||||||||||||||||||||||||
Other | 4,931 | 4,948 | — | 170 | 4,265 | 56 | 4,025 | ||||||||||||||||||||||||||
Faith based non-profit: | |||||||||||||||||||||||||||||||||
Construction | — | — | — | — | — | — | — | ||||||||||||||||||||||||||
Owner occupied | 16,593 | 16,648 | — | 663 | 10,764 | 365 | 11,511 | ||||||||||||||||||||||||||
Other | — | — | — | — | — | — | — | ||||||||||||||||||||||||||
Residential real estate: | |||||||||||||||||||||||||||||||||
First mortgage | 2,712 | 2,680 | — | 155 | 1,668 | 145 | 2,120 | ||||||||||||||||||||||||||
Multifamily | — | — | — | — | — | — | — | ||||||||||||||||||||||||||
Home equity | 8 | 8 | — | — | 50 | — | 30 | ||||||||||||||||||||||||||
Construction | — | — | — | — | — | — | — | ||||||||||||||||||||||||||
Consumer | 12 | 13 | — | — | 7 | — | 10 | ||||||||||||||||||||||||||
Impaired loans with no allowance recorded | $ | 28,036 | $ | 27,845 | $ | — | $ | 1,093 | $ | 17,834 | $ | 643 | $ | 19,037 | |||||||||||||||||||
With an allowance recorded: | |||||||||||||||||||||||||||||||||
Commercial | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | |||||||||||||||||||
Commercial real estate: | |||||||||||||||||||||||||||||||||
Construction | — | — | — | — | — | — | — | ||||||||||||||||||||||||||
Owner occupied | — | — | — | — | 59 | — | 59 | ||||||||||||||||||||||||||
Other | — | — | — | — | 334 | — | — | ||||||||||||||||||||||||||
Faith based non-profit: | |||||||||||||||||||||||||||||||||
Construction | — | — | — | — | — | — | — | ||||||||||||||||||||||||||
Owner occupied | 458 | 459 | 87 | 29 | 364 | — | 442 | ||||||||||||||||||||||||||
Other | — | — | — | — | — | — | — | ||||||||||||||||||||||||||
Residential real estate: | |||||||||||||||||||||||||||||||||
First mortgage | 1,273 | 1,276 | 239 | 58 | 877 | 58 | 960 | ||||||||||||||||||||||||||
Multifamily | — | — | — | — | — | — | — | ||||||||||||||||||||||||||
Home equity | 91 | 91 | 26 | 4 | 23 | 4 | 46 | ||||||||||||||||||||||||||
Construction | — | — | — | — | — | — | — | ||||||||||||||||||||||||||
Consumer | — | — | — | — | — | — | — | ||||||||||||||||||||||||||
Impaired loans with allowance recorded | $ | 1,822 | $ | 1,826 | $ | 352 | $ | 91 | $ | 1,657 | $ | 62 | $ | 1,507 | |||||||||||||||||||
Impaired loans | $ | 29,858 | $ | 29,671 | $ | 352 | $ | 1,184 | $ | 19,491 | $ | 705 | $ | 20,544 | |||||||||||||||||||
30-Sep-12 | |||||||||||||||||||||||||||||||||
At end of period | For Nine Months Ended | For Three Months Ended | |||||||||||||||||||||||||||||||
Unpaid | Interest | Average | Interest | Average | |||||||||||||||||||||||||||||
Principal | Recorded | ALLL | Income | Recorded | Income | Recorded | |||||||||||||||||||||||||||
(Dollars in thousands) | Balance | Investment | Allocated | Recognized | Investment | Recognized | Investment | ||||||||||||||||||||||||||
With no related allowance recorded: | |||||||||||||||||||||||||||||||||
Commercial | $ | 1,567 | $ | 590 | $ | — | $ | — | $ | 590 | $ | — | $ | 590 | |||||||||||||||||||
Commercial real estate: | |||||||||||||||||||||||||||||||||
Construction | 374 | 374 | — | 24 | 499 | 7 | 374 | ||||||||||||||||||||||||||
Owner occupied | 551 | 551 | — | 28 | 805 | 6 | 638 | ||||||||||||||||||||||||||
Other | 4,962 | 5,964 | — | 143 | 5,162 | 58 | 5,832 | ||||||||||||||||||||||||||
Faith based non-profit: | |||||||||||||||||||||||||||||||||
Construction | — | — | — | — | — | — | — | ||||||||||||||||||||||||||
Owner occupied | 13,133 | 13,126 | — | 331 | 12,384 | 69 | 13,171 | ||||||||||||||||||||||||||
Other | — | — | — | — | — | — | — | ||||||||||||||||||||||||||
Residential real estate: | |||||||||||||||||||||||||||||||||
First mortgage | 889 | 889 | — | 18 | 797 | 4 | 834 | ||||||||||||||||||||||||||
Multifamily | — | — | — | — | — | — | — | ||||||||||||||||||||||||||
Home equity | — | — | — | — | — | — | — | ||||||||||||||||||||||||||
Construction | — | — | — | — | — | — | — | ||||||||||||||||||||||||||
Consumer | — | — | — | — | — | — | — | ||||||||||||||||||||||||||
Impaired loans with no allowance recorded | $ | 21,476 | $ | 21,494 | $ | — | $ | 544 | $ | 20,237 | $ | 144 | $ | 21,439 | |||||||||||||||||||
With an allowance recorded: | |||||||||||||||||||||||||||||||||
Commercial | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | |||||||||||||||||||
Commercial real estate: | |||||||||||||||||||||||||||||||||
Construction | — | — | — | — | 283 | — | 189 | ||||||||||||||||||||||||||
Owner occupied | 239 | 239 | 102 | 12 | 468 | 3 | 241 | ||||||||||||||||||||||||||
Other | 2,005 | 2,005 | 211 | 91 | 625 | 6 | 1,211 | ||||||||||||||||||||||||||
Faith based non-profit: | |||||||||||||||||||||||||||||||||
Construction | — | — | — | — | — | — | — | ||||||||||||||||||||||||||
Owner occupied | 430 | 430 | 52 | 22 | 788 | 5 | 667 | ||||||||||||||||||||||||||
Other | — | — | — | — | — | — | — | ||||||||||||||||||||||||||
Residential real estate: | |||||||||||||||||||||||||||||||||
First mortgage | 1,298 | 1,298 | 342 | 44 | 731 | 12 | 666 | ||||||||||||||||||||||||||
Multifamily | — | — | — | — | — | — | — | ||||||||||||||||||||||||||
Home equity | — | — | — | — | 231 | — | — | ||||||||||||||||||||||||||
Construction | — | — | — | — | — | — | — | ||||||||||||||||||||||||||
Consumer | — | — | — | — | 1 | — | — | ||||||||||||||||||||||||||
Impaired loans with allowance recorded | $ | 3,972 | $ | 3,972 | $ | 707 | $ | 169 | $ | 3,127 | $ | 26 | $ | 2,974 | |||||||||||||||||||
Impaired loans | $ | 25,448 | $ | 25,466 | $ | 707 | $ | 713 | $ | 23,364 | $ | 170 | $ | 24,413 | |||||||||||||||||||
31-Dec-12 | |||||||||||||||||||||||||||||||||
At end of period | For Period Ended | ||||||||||||||||||||||||||||||||
Unpaid | Interest | Average | |||||||||||||||||||||||||||||||
Principal | Recorded | ALLL | Income | Recorded | |||||||||||||||||||||||||||||
(Dollars in thousands) | Balance | Investment | Allocated | Recognized | Investment | ||||||||||||||||||||||||||||
With no related allowance recorded: | |||||||||||||||||||||||||||||||||
Commercial | $ | — | $ | — | $ | — | $ | — | $ | 295 | |||||||||||||||||||||||
Commercial real estate: | |||||||||||||||||||||||||||||||||
Construction | 371 | 371 | — | 31 | 300 | ||||||||||||||||||||||||||||
Owner occupied | 530 | 530 | — | 38 | 635 | ||||||||||||||||||||||||||||
Other | 4,312 | 3,698 | — | 129 | 4,473 | ||||||||||||||||||||||||||||
Faith based non-profit: | |||||||||||||||||||||||||||||||||
Construction | — | — | — | — | — | ||||||||||||||||||||||||||||
Owner occupied | 14,479 | 14,479 | — | 567 | 12,261 | ||||||||||||||||||||||||||||
Other | — | — | — | — | 1,611 | ||||||||||||||||||||||||||||
Residential real estate: | |||||||||||||||||||||||||||||||||
First mortgage | 814 | 814 | — | 19 | 2,671 | ||||||||||||||||||||||||||||
Multifamily | — | — | — | — | — | ||||||||||||||||||||||||||||
Home equity | 86 | 86 | — | 3 | 111 | ||||||||||||||||||||||||||||
Construction | — | — | — | — | — | ||||||||||||||||||||||||||||
Consumer | 16 | 16 | — | — | 4 | ||||||||||||||||||||||||||||
Impaired loans with no allowance recorded | $ | 20,608 | $ | 19,994 | $ | — | $ | 787 | $ | 22,361 | |||||||||||||||||||||||
With an allowance recorded: | |||||||||||||||||||||||||||||||||
Commercial | $ | — | $ | — | $ | — | $ | — | $ | — | |||||||||||||||||||||||
Commercial real estate: | |||||||||||||||||||||||||||||||||
Construction | — | — | — | — | — | ||||||||||||||||||||||||||||
Owner occupied | 238 | 238 | 87 | 15 | 60 | ||||||||||||||||||||||||||||
Other | — | — | — | — | 500 | ||||||||||||||||||||||||||||
Faith based non-profit: | |||||||||||||||||||||||||||||||||
Construction | — | — | — | — | 214 | ||||||||||||||||||||||||||||
Owner occupied | 428 | 428 | 44 | 30 | — | ||||||||||||||||||||||||||||
Other | — | — | — | — | — | ||||||||||||||||||||||||||||
Residential real estate: | |||||||||||||||||||||||||||||||||
First mortgage | 1,543 | 1,543 | 349 | 45 | 757 | ||||||||||||||||||||||||||||
Multifamily | — | — | — | — | — | ||||||||||||||||||||||||||||
Home equity | — | — | — | — | — | ||||||||||||||||||||||||||||
Construction | — | — | — | — | — | ||||||||||||||||||||||||||||
Consumer | — | — | — | — | — | ||||||||||||||||||||||||||||
Impaired loans with allowance recorded | $ | 2,209 | $ | 2,209 | $ | 480 | $ | 90 | $ | 1,531 | |||||||||||||||||||||||
Impaired loans | $ | 22,817 | $ | 22,203 | $ | 480 | $ | 877 | $ | 23,892 | |||||||||||||||||||||||
Impaired loans not included in the above December 31, 2012 table are recorded investments of $1.9 million in homogeneous first mortgage residential real estate loans, which are collectively measured for impairment. Total impaired loans were $24.1 million as of December 31, 2012. | |||||||||||||||||||||||||||||||||
The recorded investment in TDRs, which are included in total impaired loans, was $24.5 million, $25.5 million and $20.2 million at September 30, 2013, September 30, 2012 and December 31, 2012, respectively. | |||||||||||||||||||||||||||||||||
Reserve for Credit Losses - The Company's reserve for credit losses is comprised of two components, the ALLL and the reserve for unfunded commitments (the “Unfunded Reserve”). | |||||||||||||||||||||||||||||||||
Allowances for Loan Losses - The ALLL is a valuation allowance that is established through a provision for loan losses charged to expense. When management believes that the collectability of the principal is unlikely, loans are charged against the ALLL. Subsequent recoveries, if any, are credited to the ALLL. | |||||||||||||||||||||||||||||||||
The ALLL is management's estimate of probable losses that are inherent in the loan portfolio. The ALLL is based on regular quarterly assessments. The methodologies for measuring the appropriate level of the ALLL include the combination of a quantitative historical loss history by loan type and a qualitative analysis for loans not classified as impaired or TDRs ("ASC 450 reserve"), and a specific allowance method for impaired and TDR loans ("ASC 310 reserve"). The qualitative analysis for the ASC 450 reserve is patterned after the guidelines provided under Securities Exchange Commission (“SEC”) Staff Accounting Bulletin 102 and the Federal Financial Institutions Examination Council (“FFIEC”) Interagency Policy Statement on the Allowance for Loan and Lease Losses and include the following: | |||||||||||||||||||||||||||||||||
· | Changes in lending policies and procedures, including underwriting standards and collection, charge-off, and recovery practices; | ||||||||||||||||||||||||||||||||
· | Changes in national economic and business conditions and developments and the effect of unemployment on African Americans, who are the majority of our customers; | ||||||||||||||||||||||||||||||||
· | Changes in the nature and volume of the loan portfolio; | ||||||||||||||||||||||||||||||||
· | Changes in the experience, ability, and depth of lending management and staff; | ||||||||||||||||||||||||||||||||
· | Changes in trends of the volume and severity of past due and classified loans; and changes in trends in the volume of non-accrual loans, troubled debt restructurings and classified loans; | ||||||||||||||||||||||||||||||||
· | Changes in the quality of the loan review system and the degree of oversight by the Bank’s Board of Directors; | ||||||||||||||||||||||||||||||||
· | The existence and effect of any concentrations of credit, and changes in the level of such concentrations; and | ||||||||||||||||||||||||||||||||
· | The effect of external factors such as competition and legal and regulatory requirements. | ||||||||||||||||||||||||||||||||
Management has developed, from historical loan and economic information, quantitative drivers for certain qualitative factors. Management has identified which factors, by nature, are subjective, such as lending policies, competition and regulatory requirements. The quantitative drivers of qualitative factors, to which different weights are assigned based on management’s judgment, are reviewed and updated quarterly based on updated quarterly and eight-quarter rolling data. The quantitative loss history is based on an eight-quarter rolling history of losses incurred by different loan types within the loan portfolio. | |||||||||||||||||||||||||||||||||
A specific ALLL is established for loans identified as impaired or TDRs, based on significant conditions or circumstances related to the specific credits. The specific allowance amounts are determined by a method prescribed by ASC 310, Receivables. Loans identified as impaired and non-accruing TDRs are accounted for in accordance with one of three valuations: (i) the present value of future cash flows discounted at the loan's effective interest rate; (ii) the loan's observable market price, or (iii) the fair value of the collateral, if the loan is collateral dependent, less estimated liquidation costs such as realtor fees, delinquent property taxes, and other miscellaneous recording fees and taxes. Generally, appraisals are considered current if performed within the past 12 months. At September 30, 2013, there were 87 loans evaluated based upon collateral dependency, and one loan evaluated based upon present value of cash flows compared to 55 loans evaluated based upon collateral dependency and no loans evaluated based upon present value of cash flows at December 31, 2012. | |||||||||||||||||||||||||||||||||
For commercial business, faith-based non-profit, real estate and certain consumer loans, the measurement of loan impairment is based on the present value of the expected future cash flows, discounted at the loan's effective interest rate, or on the fair value of the loan's collateral if the loan is collateral dependent. Most consumer loans are smaller balance and homogeneous, and are evaluated for impairment on a collective basis, applying the quantitative loss history and the qualitative factors. Impairment losses are included in the ALLL through a charge to the provision for loan losses. | |||||||||||||||||||||||||||||||||
The Company uses several credit quality indicators to manage credit risk on an ongoing basis. The Company's credit risk rating system was developed to aid in the risk management process by grouping credits with similar risk profiles into pass (which includes internal watch), special mention, or criticized categories, which includes substandard, doubtful, and loss. Credit risk ratings are applied individually to all classes of loans. Internal credit reviews and external contracted credit review examinations are used to determine and validate loan risk grades. The credit review system takes into consideration factors such as: borrower's background and experience; historical and current financial condition; credit history and payment performance; economic conditions and their impact on various industries; type, market value and volatility of the market value of collateral; lien position; and the financial strength of guarantors. | |||||||||||||||||||||||||||||||||
The process of assessing the adequacy of the ALLL is necessarily subjective. Further, and particularly in periods of economic downturns, it is reasonably possible that future credit losses may exceed historical loss levels and may also exceed management's current estimates of incurred losses inherent within the loan portfolio. As such, there can be no assurance that future loan charge-offs will not exceed management's current estimate of what constitutes a reasonable ALLL. | |||||||||||||||||||||||||||||||||
The Company and the Bank are subject to periodic examination by their federal and state regulators, and may be required by such regulators to recognize additions to the allowance for loan losses based on the regulators' assessment of credit information available to them at the time of their examinations. | |||||||||||||||||||||||||||||||||
Reserve for Unfunded Commitments - The Unfunded Reserve is a component of other liabilities and represents the estimate for probable credit losses inherent in unfunded commitments to extend credit. Unfunded commitments to extend credit include loans with usable balances available, new commitments to lend that are not yet funded, and standby and commercial letters of credit. The process used to determine the Unfunded Reserve is consistent with the process for determining the quantitative portion of the ASC 450 reserve, as adjusted for estimated funding probabilities and historical eight quarter rolling quantitative loan loss factors. The level of the Unfunded Reserve is adjusted by recording an expense or recovery in other noninterest expense. The balances of $39 thousand and $54 thousand at September 30, 2013 and December 31, 2012, respectively, are reflected in other liabilities on the Consolidated Balance Sheets. | |||||||||||||||||||||||||||||||||
The following table presents the recorded investment in non-accrual loans and loans past due over 90 days still on accrual by class of loans as of September 30, 2013 and December 31, 2012, respectively: | |||||||||||||||||||||||||||||||||
90 Days | |||||||||||||||||||||||||||||||||
or More | |||||||||||||||||||||||||||||||||
Past Due | |||||||||||||||||||||||||||||||||
30-Sep-13 | Still | ||||||||||||||||||||||||||||||||
(Dollars in thousands) | Non-accrual | Number | Accruing | Number | |||||||||||||||||||||||||||||
Commercial | $ | 2 | 1 | $ | — | — | |||||||||||||||||||||||||||
Commercial real estate: | |||||||||||||||||||||||||||||||||
Construction | — | — | — | — | |||||||||||||||||||||||||||||
Owner occupied | 78 | 2 | 52 | 1 | |||||||||||||||||||||||||||||
Other | 45 | 1 | 526 | 3 | |||||||||||||||||||||||||||||
Faith-based non-profit | |||||||||||||||||||||||||||||||||
Construction | — | — | — | — | |||||||||||||||||||||||||||||
Owner Occupied | 1,285 | 2 | — | — | |||||||||||||||||||||||||||||
Other | — | — | — | — | |||||||||||||||||||||||||||||
Residential real estate: | |||||||||||||||||||||||||||||||||
First mortgage | 3,092 | 39 | 814 | 16 | |||||||||||||||||||||||||||||
Multifamily | — | — | — | — | |||||||||||||||||||||||||||||
Home equity | 14 | 3 | 19 | 1 | |||||||||||||||||||||||||||||
Construction | — | — | — | — | |||||||||||||||||||||||||||||
Consumer | 12 | 2 | — | — | |||||||||||||||||||||||||||||
Other loans | — | — | — | — | |||||||||||||||||||||||||||||
Total | $ | 4,528 | 50 | $ | 1,411 | 21 | |||||||||||||||||||||||||||
90 Days | |||||||||||||||||||||||||||||||||
or More | |||||||||||||||||||||||||||||||||
Past Due | |||||||||||||||||||||||||||||||||
31-Dec-12 | Still | ||||||||||||||||||||||||||||||||
(Dollars in thousands) | Non-accrual | Number | Accruing | Number | |||||||||||||||||||||||||||||
Commercial | $ | — | — | $ | — | — | |||||||||||||||||||||||||||
Commercial real estate: | |||||||||||||||||||||||||||||||||
Construction | — | — | — | — | |||||||||||||||||||||||||||||
Owner occupied | 39 | 1 | 224 | 4 | |||||||||||||||||||||||||||||
Other | 49 | 1 | 351 | 1 | |||||||||||||||||||||||||||||
Faith-based non-profit | |||||||||||||||||||||||||||||||||
Construction | — | — | — | — | |||||||||||||||||||||||||||||
Owner Occupied | 5,241 | 4 | 661 | 3 | |||||||||||||||||||||||||||||
Other | — | — | — | — | |||||||||||||||||||||||||||||
Residential real estate: | |||||||||||||||||||||||||||||||||
First mortgage | 3,384 | 44 | 357 | 6 | |||||||||||||||||||||||||||||
Multifamily | — | — | — | — | |||||||||||||||||||||||||||||
Home equity | 3 | 1 | 101 | 1 | |||||||||||||||||||||||||||||
Construction | — | — | — | — | |||||||||||||||||||||||||||||
Consumer | 16 | 2 | — | — | |||||||||||||||||||||||||||||
Other loans | — | — | — | — | |||||||||||||||||||||||||||||
Total | $ | 8,732 | 53 | $ | 1,694 | 15 | |||||||||||||||||||||||||||
Non-accrual loans and loans past due over 90 days still accruing interest include both smaller balance homogenous loans that are collectively evaluated for impairment and individually classified impaired loans. Loans for which principal or interest is in default for 90 days or more are classified as a non-accrual unless they are well secured and in process of collection. | |||||||||||||||||||||||||||||||||
Those loans over 90 days still accruing interest were in the process of modification. In these cases, the borrowers are still making payments. Borrowers have continued to make payments on these loans while administrative and legal due processes are proceeding which will enable the Bank to extend or modify maturity dates. | |||||||||||||||||||||||||||||||||
The Company categorizes loans into risk categories based on relevant information about the ability of borrowers to service their debt such as current financial information, historical payment experience, credit documentation, public information, and current economic trends, among other factors. The Company analyzes loans for reserves according to the loan's classification as to credit risk. This analysis includes non-homogenous loans, such as commercial, commercial real estate and faith-based non–profit entities, and mortgage loans in process of foreclosure for which the loan to value does not support repayment in full. This analysis is performed on at least a quarterly basis. The Company uses the following definitions for risk ratings: | |||||||||||||||||||||||||||||||||
· | Special Mention. Loans classified as special mention have a potential weakness that deserves management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or of the institution’s credit position at some future date. Management believes that there is a moderate likelihood of some loss related to those loans and leases that are considered special mention. | ||||||||||||||||||||||||||||||||
· | Substandard. Loans classified as substandard are inadequately protected by the current sound financial repayment capacity and debt service coverage of the obligor or of the collateral pledge, if any. Loans so classified have a well-defined weakness or weaknesses that may jeopardize the liquidation of repayment according to the original terms of the debt. In addition to commercial and faith-based non-profit loans with identified weaknesses, substandard loans include loans within the mortgage and consumer portfolio segments that are past due 90 days or more as to principal or interest if the loan to value does not support full repayment. Substandard loans are evaluated for impairment on an individual loan basis unless the substandard loan is a smaller homogeneous loan that is not a TDR and is not in the process of foreclosure. These loans exhibit a distinct possibility that the Company will sustain some loss if the deficiencies related to the loss are not corrected in a timely manner. | ||||||||||||||||||||||||||||||||
· | Doubtful. Loans classified as doubtful have all the weaknesses inherent in those classified as substandard, with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions, and values, highly questionable and improbable. | ||||||||||||||||||||||||||||||||
· | Loss. Based on current facts and circumstances, loans classified as loss are not expected to be repaid, or that collateral will be difficult to liquidate. Loans classified as loss are charged off to the ALLL with board approval. | ||||||||||||||||||||||||||||||||
· | Pass. Loans not identified as special mention, substandard, doubtful or loss are classified as pass. | ||||||||||||||||||||||||||||||||
The following is a breakdown of loans by risk categories at September 30, 2013 and December 31, 2012: | |||||||||||||||||||||||||||||||||
30-Sep-13 | |||||||||||||||||||||||||||||||||
(Dollars in thousands) | Pass | Special Mention | Substandard | Doubtful | Total | ||||||||||||||||||||||||||||
Commercial | $ | 9,802 | $ | 2,850 | $ | 6 | $ | — | $ | 12,658 | |||||||||||||||||||||||
Commercial real estate: | |||||||||||||||||||||||||||||||||
Construction | 3,812 | — | 547 | — | 4,359 | ||||||||||||||||||||||||||||
Owner occupied | 17,023 | 608 | 4,018 | — | 21,649 | ||||||||||||||||||||||||||||
Other | 24,326 | 961 | 3,562 | — | 28,849 | ||||||||||||||||||||||||||||
Faith-based non-profit | |||||||||||||||||||||||||||||||||
Construction | — | — | — | — | — | ||||||||||||||||||||||||||||
Owner Occupied | 65,252 | 8,255 | 5,940 | — | 79,447 | ||||||||||||||||||||||||||||
Other | 6,478 | 2 | — | — | 6,480 | ||||||||||||||||||||||||||||
Residential real estate: | |||||||||||||||||||||||||||||||||
First mortgage | 18,832 | 684 | 3,643 | — | 23,159 | ||||||||||||||||||||||||||||
Multifamily | 3,675 | 39 | 62 | — | 3,776 | ||||||||||||||||||||||||||||
Home equity | 2,820 | — | 320 | — | 3,140 | ||||||||||||||||||||||||||||
Construction | — | — | — | — | — | ||||||||||||||||||||||||||||
Consumer | 1,194 | — | 18 | — | 1,212 | ||||||||||||||||||||||||||||
Other loans | 2,427 | — | — | — | 2,427 | ||||||||||||||||||||||||||||
Total | $ | 155,641 | $ | 13,399 | $ | 18,116 | $ | — | $ | 187,156 | |||||||||||||||||||||||
31-Dec-12 | |||||||||||||||||||||||||||||||||
(Dollars in thousands) | Pass | Special Mention | Substandard | Doubtful | Total | ||||||||||||||||||||||||||||
Commercial | $ | 3,274 | $ | — | $ | 8 | $ | — | $ | 3,282 | |||||||||||||||||||||||
Commercial real estate: | |||||||||||||||||||||||||||||||||
Construction | 3,065 | — | 556 | — | 3,621 | ||||||||||||||||||||||||||||
Owner occupied | 13,379 | 3,151 | 1,847 | — | 18,377 | ||||||||||||||||||||||||||||
Other | 21,582 | 966 | 3,623 | — | 26,171 | ||||||||||||||||||||||||||||
Faith-based non-profit | |||||||||||||||||||||||||||||||||
Construction | 2,344 | — | — | — | 2,344 | ||||||||||||||||||||||||||||
Owner Occupied | 58,732 | 5,313 | 12,373 | — | 76,418 | ||||||||||||||||||||||||||||
Other | 7,059 | 76 | — | — | 7,135 | ||||||||||||||||||||||||||||
Residential real estate: | |||||||||||||||||||||||||||||||||
First mortgage | 19,465 | 1,731 | 3,506 | — | 24,702 | ||||||||||||||||||||||||||||
Multifamily | 5,702 | 63 | 63 | — | 5,828 | ||||||||||||||||||||||||||||
Home equity | 2,853 | — | 308 | — | 3,161 | ||||||||||||||||||||||||||||
Construction | 83 | — | — | — | 83 | ||||||||||||||||||||||||||||
Consumer | 1,323 | 2 | 21 | — | 1,346 | ||||||||||||||||||||||||||||
Other loans | 2,754 | — | — | — | 2,754 | ||||||||||||||||||||||||||||
Total | $ | 141,615 | $ | 11,302 | $ | 22,305 | $ | — | $ | 175,222 | |||||||||||||||||||||||
Loans Modified as a TDR - Loans are considered to have been modified as a TDR when the Company makes certain concessions to a borrower experiencing financial difficulty. Concessions to the borrower at modification may include interest rate reductions, principal or interest forgiveness, forbearance, and other actions intended to minimize economic loss and to avoid foreclosure or repossession of collateral. Generally, a non-accrual loan that has been modified as a TDR remains on non-accrual status for a period of six months to demonstrate that the borrower is able to meet the terms of the modified loan. However, performance prior to the modification, or significant events that coincide with the modification, are included in assessing whether the borrower can meet the new terms and may result in the loan being returned to accrual status at the time of loan modification or after a shorter performance period. Since the economic crisis began in 2008, management has elected to offer concessions to borrowers with identified financial weaknesses, even if the borrowers have continued making scheduled payments, working with the borrowers to enable them to continue meeting their obligations to repay the debt to the Company. | |||||||||||||||||||||||||||||||||
The following tables present TDRs as of September 30, 2013 and December 31, 2012. | |||||||||||||||||||||||||||||||||
Troubled Debt Restructurings | |||||||||||||||||||||||||||||||||
30-Sep-13 | |||||||||||||||||||||||||||||||||
Non-accrual | Total | ||||||||||||||||||||||||||||||||
Accrual Status | Status | Modifications | |||||||||||||||||||||||||||||||
(Dollars in thousands) | Number | Amount | Number | Amount | Number | Amount | |||||||||||||||||||||||||||
Commercial real estate: | |||||||||||||||||||||||||||||||||
Construction | 2 | $ | 362 | — | $ | — | 2 | $ | 362 | ||||||||||||||||||||||||
Owner occupied | 5 | 3,105 | — | — | 5 | 3,105 | |||||||||||||||||||||||||||
Other | 5 | 4,886 | — | — | 5 | 4,886 | |||||||||||||||||||||||||||
Faith-based non-profit: | |||||||||||||||||||||||||||||||||
Owner occpied | 20 | 15,767 | 1 | 30 | 21 | 15,797 | |||||||||||||||||||||||||||
Residential real estate: | |||||||||||||||||||||||||||||||||
First mortgage | 1 | 31 | 3 | 251 | 4 | 282 | |||||||||||||||||||||||||||
33 | $ | 24,151 | 4 | $ | 281 | 37 | $ | 24,432 | |||||||||||||||||||||||||
Troubled Debt Restructurings | |||||||||||||||||||||||||||||||||
31-Dec-12 | |||||||||||||||||||||||||||||||||
Non-accrual | Total | ||||||||||||||||||||||||||||||||
Accrual Status | Status | Modifications | |||||||||||||||||||||||||||||||
(Dollars in thousands) | Number | Amount | Number | Amount | Number | Amount | |||||||||||||||||||||||||||
Commercial real estate: | |||||||||||||||||||||||||||||||||
Construction | 2 | $ | 371 | — | $ | — | 2 | $ | 371 | ||||||||||||||||||||||||
Owner occupied | 4 | 730 | — | — | 4 | 730 | |||||||||||||||||||||||||||
Other | 5 | 3,648 | — | — | 5 | 3,648 | |||||||||||||||||||||||||||
Faith-based non-profit: | |||||||||||||||||||||||||||||||||
Owner occpied | 17 | 9,666 | 4 | 5,241 | 21 | 14,907 | |||||||||||||||||||||||||||
Residential real estate: | |||||||||||||||||||||||||||||||||
First mortgage | 2 | 285 | 4 | 309 | 6 | 594 | |||||||||||||||||||||||||||
30 | $ | 14,700 | 8 | $ | 5,550 | 38 | $ | 20,250 | |||||||||||||||||||||||||
The following table shows loans restructured during the three and nine months ended September 30, 2013. | |||||||||||||||||||||||||||||||||
30-Sep-13 | |||||||||||||||||||||||||||||||||
Pre-modification Outstanding | Post-Modification Outstanding | ||||||||||||||||||||||||||||||||
(Dollars in thousands) | Number of loans | Recorded Investment | Recorded Investment | ||||||||||||||||||||||||||||||
Extended payment terms | |||||||||||||||||||||||||||||||||
Commercial real estate: | |||||||||||||||||||||||||||||||||
Owner occupied | 1 | $ | 40 | $ | 21 | ||||||||||||||||||||||||||||
Faith-based non-profit: | |||||||||||||||||||||||||||||||||
Owner Occupied | 1 | 1,284 | 1,276 | ||||||||||||||||||||||||||||||
2 | $ | 1,324 | $ | 1,297 | |||||||||||||||||||||||||||||
For the Nine Months Ended | |||||||||||||||||||||||||||||||||
30-Sep-13 | |||||||||||||||||||||||||||||||||
Pre-modification Outstanding | Post-Modification Outstanding | ||||||||||||||||||||||||||||||||
(Dollars in thousands) | Number of loans | Recorded Investment | Recorded Investment | ||||||||||||||||||||||||||||||
Extended payment terms | |||||||||||||||||||||||||||||||||
Commercial real estate: | |||||||||||||||||||||||||||||||||
Owner occupied | 1 | $ | 40 | $ | 21 | ||||||||||||||||||||||||||||
Faith-based non-profit: | |||||||||||||||||||||||||||||||||
Owner Occupied | 1 | 1,284 | 1,276 | ||||||||||||||||||||||||||||||
2 | $ | 1,324 | $ | 1,297 | |||||||||||||||||||||||||||||
The following table shows loans restructured during the three and nine months ended September 30, 2012. | |||||||||||||||||||||||||||||||||
For the Three Months Ended | |||||||||||||||||||||||||||||||||
30-Sep-12 | |||||||||||||||||||||||||||||||||
Pre-modification Outstanding | Post-Modification Outstanding | ||||||||||||||||||||||||||||||||
(Dollars in thousands) | Number of loans | Recorded Investment | Recorded Investment | ||||||||||||||||||||||||||||||
Below market interest rate | |||||||||||||||||||||||||||||||||
Owner Occupied | 1 | $ | 2,522 | $ | 2,522 | ||||||||||||||||||||||||||||
Other loans | — | — | — | ||||||||||||||||||||||||||||||
1 | $ | 2,522 | $ | 2,522 | |||||||||||||||||||||||||||||
For the Nine Months Ended | |||||||||||||||||||||||||||||||||
30-Sep-12 | |||||||||||||||||||||||||||||||||
Pre-modification Outstanding | Post-Modification Outstanding | ||||||||||||||||||||||||||||||||
(Dollars in thousands) | Number of loans | Recorded Investment | Recorded Investment | ||||||||||||||||||||||||||||||
Below market interest rate | |||||||||||||||||||||||||||||||||
Owner Occupied | 1 | 2,522 | 2,522 | ||||||||||||||||||||||||||||||
Extended payment terms | |||||||||||||||||||||||||||||||||
Owner occupied | 1 | 80 | 80 | ||||||||||||||||||||||||||||||
Other loans | 1 | 1,353 | 1,353 | ||||||||||||||||||||||||||||||
3 | $ | 3,955 | $ | 3,955 | |||||||||||||||||||||||||||||
There were no loans modified as TDRs and with a payment default, with the payment default occurring within 12 months of the restructure date, and the payment default occurring during the three and nine months ended September 30, 2013 and 2012. | |||||||||||||||||||||||||||||||||
TDR defaults can result in a higher ALLL and a corresponding higher provision for loan losses because they generally negatively impact the timing of and expected collections from these impaired loans. Impaired loans, which include TDRs, are evaluated for specific additions to the ALLL by subtracting the recorded investment in these impaired loans from their fair values. Fair values is generally determined by the present value of future cash flows, collateral value, or liquidation value. Defaults generally reduce the present value of the future cash flows and can negatively influence the collateral values if the declining real estate values affect the sale of collateral. |
OTHER_REAL_ESTATE_OWNED
OTHER REAL ESTATE OWNED | 9 Months Ended | |
Sep. 30, 2013 | ||
Real Estate [Abstract] | ' | |
OTHER REAL ESTATE OWNED ("OREO") | ' | |
7 | OTHER REAL ESTATE OWNED (“OREO”) | |
At the time of foreclosure, real estate is recorded at fair market value based on appraised value less estimated costs to sell, such as realtor, legal and recording fees and expenses. Subsequent to foreclosure, properties are appraised annually and adjusted to the lower of carrying amount or fair market value less estimated costs to sell. At September 30, 2013 and December 31, 2012, OREO totaled $2.9 million and $3.1 million, respectively. |
BORROWINGS
BORROWINGS | 9 Months Ended | |
Sep. 30, 2013 | ||
BorrowingsAbstract | ' | |
BORROWINGS | ' | |
8 | BORROWINGS | |
Borrowings as of September 30, 2013 consisted of an FHLB borrowing of $0.7 million with an interest rate of 0.50% that matures in 2020 and a capital lease of $0.2 million with an interest rate of 1.60%. Borrowings as of December 31, 2012 consisted of an FHLB borrowing of $0.7 million with an interest rate of 0.50% that matures in 2020, a capital lease of $0.2 million with an interest rate of 1.60%, and $2.0 million in loan participations sold (that did not qualify for sales accounting under GAAP), with an effective interest rate of 4.45%. During the first quarter of 2013, loan participation agreements were updated to conform for sales accounting treatment; therefore, loan participations are now netted within the loans category. | ||
The Company has federal funds lines of credit with three correspondent banks totaling $10.0 million at September 30, 2013 and December 31, 2012. The Company periodically tests its federal funds lines of credit with its correspondent banks. These lines were tested during the three and nine months ended September 30, 2013. The Company had unused borrowing capacity with the FHLB of $6.3 million as of September 30, 2013 and $7.5 million as of December 31, 2012. In addition, the Company has the ability to borrow from the Federal Reserve Bank to the extent of investment securities pledged to the Federal Reserve Bank. |
COMMITMENTS_AND_CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 9 Months Ended | ||||||||||||
Sep. 30, 2013 | |||||||||||||
Commitments And Contingencies | ' | ||||||||||||
COMMITMENTS AND CONTINGENCIES | ' | ||||||||||||
9 | COMMITMENTS AND CONTINGENCIES | ||||||||||||
The Bank is a 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. These instruments involve, to varying degrees, elements of credit and interest rate risk beyond the amount recognized on the Consolidated Balance Sheets. The contractual amounts of those instruments reflect the extent of involvement the Bank has in particular classes of financial instruments. | |||||||||||||
The Bank’s exposure to credit losses in the event of non-performance by the other party to the financial instrument for commitments to extend credit and standby letters of credit is represented by the contractual amount of those instruments. The Bank utilizes the same credit policies in making commitments and conditional obligations as it does for balance sheet instruments. | |||||||||||||
Commitments to extend credit are agreements to lend to a customer as long as there is not a 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. 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 Bank evaluates each customer’s credit worthiness on a case-by-case basis. The amount of collateral obtained, if deemed necessary by the Bank, upon extension of credit is based on management’s credit evaluation of the counter parties. Collateral varies and may include real estate, accounts receivable, inventory, property, plant and equipment, and income-producing commercial properties. | |||||||||||||
Standby letters of credit are conditional commitments issued by the Bank to guarantee the performance of a customer to a third party. The credit risk involved in issuing letters of credit is essentially the same as that involved in extending loan facilities to customers. To the extent deemed necessary, collateral of varying types and amounts is held to secure customer performance under certain of those letters of credit outstanding. | |||||||||||||
Financial instruments whose contract amounts represent credit risk as of September 30, 2013 and December 31, 2012, respectively, are commitments to extend credit (including availability of lines of credit), and standby letters of credit. Loan commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. The Bank evaluates each customer’s credit worthiness on a case-by-case basis. The amount of collateral deemed necessary by the Bank is based on management’s credit evaluation and underwriting guidelines for the particular loan. | |||||||||||||
Commitments outstanding at September 30, 2013 are summarized in the following table: | |||||||||||||
(Dollars in thousands) | Commercial | Other loan | Total | ||||||||||
letters of credit | commitments | commitments | |||||||||||
Less than one year | $ | 123 | $ | 5,240 | $ | 5,363 | |||||||
One to three years | 86 | 730 | 816 | ||||||||||
Three to five years | 321 | 1,775 | 2,096 | ||||||||||
More than five years | — | 20,411 | 20,411 | ||||||||||
Total | $ | 530 | $ | 28,156 | $ | 28,686 |
FAIR_VALUE_MEASUREMENT
FAIR VALUE MEASUREMENT | 9 Months Ended | ||||||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||||||
Fair Value Measurement | ' | ||||||||||||||||||||
FAIR VALUE MEASUREMENT | ' | ||||||||||||||||||||
10 | FAIR VALUE MEASUREMENT | ||||||||||||||||||||
Fair value is defined as the exchange price that would be received to sell an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Fair value should be based on the assumptions market participants would use when pricing an asset or liability and establishes a fair value hierarchy that prioritizes the information used to develop those assumptions. The fair value hierarchy gives the highest priority to quoted prices in active markets and the lowest priority to unobservable data. Fair value measurements are required to be separately disclosed by level within the fair value hierarchy. The Company bases fair values on the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. | |||||||||||||||||||||
For assets and liabilities recorded at fair value, the Company maximizes the use of observable inputs and minimizes the use of unobservable inputs when developing fair value measurements, in accordance with the fair value hierarchy. | |||||||||||||||||||||
Fair value measurements for assets and liabilities where there exists limited or no observable market data and, therefore, are based primarily upon estimates, are often calculated based on the economic and competitive environment, the characteristics of the asset or liability and other factors. Therefore, the results cannot be determined with precision and may not be realized in an actual sale or immediate settlement of the asset or liability. Additionally, there may be inherent weaknesses in any calculation technique, and changes in the underlying assumptions used, including discount rates and estimates of future cash flows, could significantly affect the results of current or future values. | |||||||||||||||||||||
The Company utilizes fair value measurements to record fair value adjustments to certain assets and liabilities and to determine fair value disclosures. Securities available-for-sale are recorded at fair value on a recurring basis. Additionally, from time to time, the Company may be required to record at fair value other assets on a nonrecurring basis, such as loans held for sale, loans held for investment, OREO, and certain other assets. These nonrecurring fair value adjustments typically involve application of lower of cost or market accounting or write-downs of individual assets. | |||||||||||||||||||||
The Company groups assets and liabilities at fair value in three levels, based on the markets in which the assets and liabilities are traded and the reliability of the assumptions used to determine fair value. These levels are: | |||||||||||||||||||||
Level 1 — Valuations for assets and liabilities traded in active exchange markets, such as the New York Stock Exchange. | |||||||||||||||||||||
Level 2 — Valuations are obtained from readily available pricing sources via independent providers for market transactions involving similar assets or liabilities. The Company’s principal market for these securities is the secondary institutional markets and valuations are based on observable market data in those markets. Level 2 securities include U. S. Agencies, state and municipal bonds and MBS. | |||||||||||||||||||||
Level 3 — Valuations for assets and liabilities that are derived from other valuation methodologies, including option pricing models, discounted cash flow models and similar techniques, and not based on market exchange, dealer, or broker traded transactions. Level 3 valuations incorporate certain assumptions and projections in determining the fair value assigned to such assets. | |||||||||||||||||||||
Assets and Liabilities Measured on a Recurring Basis: | |||||||||||||||||||||
Available-for-Sale Investment Securities: Investment securities are recorded at fair value on a recurring basis. Fair value measurement is based upon quoted prices, if available. If quoted prices are not available, fair values are measured using matrix pricing, which is a mathematical technique used widely in the industry to value debt securities without relying exclusively on quoted prices for the specific securities but rather by relying on the securities’ relationship to other benchmark quoted securities. Level 1 securities include those traded on nationally recognized securities exchanges, U.S. Treasury securities, and money market funds. Level 2 securities include U.S. government agency securities, mortgage-backed securities issued by government-sponsored entities, municipal bonds and corporate debt securities. Securities classified as Level 3 include asset-backed securities in less liquid markets. | |||||||||||||||||||||
Assets measured at fair value on a recurring basis as of September 30, 2013 were: | |||||||||||||||||||||
(Dollars in thousands) | Quoted Prices in | Significant Other | Significant | ||||||||||||||||||
Active Markets for | Observable | Unobservable | |||||||||||||||||||
Identical Assets | Inputs | Inputs | |||||||||||||||||||
Description | 30-Sep-13 | (Level 1) | (Level 2) | (Level 3) | |||||||||||||||||
Recurring: | |||||||||||||||||||||
US government agencies | $ | 4,882 | $ | — | $ | 4,882 | $ | — | |||||||||||||
Government sponsored MBS | |||||||||||||||||||||
Residential | 51,579 | — | 51,579 | — | |||||||||||||||||
Municipal securities | |||||||||||||||||||||
North Carolina | 1,477 | — | 1,477 | — | |||||||||||||||||
Total | $ | 57,938 | $ | — | $ | 57,938 | $ | — | |||||||||||||
Assets measured at fair value on a recurring basis as of December 31, 2012 were: | |||||||||||||||||||||
(Dollars in thousands) | Quoted Prices in | Significant Other | Significant | ||||||||||||||||||
Active Markets for | Observable | Unobservable | |||||||||||||||||||
Identical Assets | Inputs | Inputs | |||||||||||||||||||
Description | 31-Dec-12 | (Level 1) | (Level 2) | (Level 3) | |||||||||||||||||
Recurring: | |||||||||||||||||||||
US government agencies | $ | 1,327 | $ | — | $ | 1,327 | $ | — | |||||||||||||
Government sponsored MBS | |||||||||||||||||||||
Residential | 57,931 | — | 57,931 | — | |||||||||||||||||
Municipal securities | |||||||||||||||||||||
North Carolina | 1,553 | — | 1,553 | — | |||||||||||||||||
Total | $ | 60,811 | $ | — | $ | 60,811 | $ | — | |||||||||||||
There were no recurring Level 3 Assets at September 30, 2013 or December 31, 2012. | |||||||||||||||||||||
Assets and Liabilities Measured on a Nonrecurring Basis: | |||||||||||||||||||||
Impaired loans: Impaired loans are evaluated and valued at the time the loan is identified as impaired, and are carried at the lower of cost or market value. Market value is measured based on the value of the collateral securing these loans or net present value of expected future cash flows discounted at the loan’s effective interest rate. Collateral may be real estate and/or business assets including equipment, inventory, and/or accounts receivable. The value of business equipment, inventory, and accounts receivable collateral is based on net book value on the business’ financial statements and, if necessary, discounted based on management’s review and analysis. Appraised and reported values may be discounted based on management’s historical knowledge, changes in market conditions from the time of valuation, and/or management’s expertise and knowledge of the client and the client’s selling costs and other expenses. Impaired loans are reviewed and evaluated on at least a quarterly basis for additional impairment and adjusted accordingly, based on the same factors identified above. The Company records impaired loans as nonrecurring Level 3, when Management believes the underlying collateral is worth less than the appraised value. | |||||||||||||||||||||
Other real estate owned (“OREO”): Foreclosed assets are adjusted to fair value, less estimated carrying costs and costs to sell, upon transfer of the loans to foreclosed assets. Subsequently, foreclosed assets are carried at the lower of the carrying value or the fair value, less estimated costs to sell. Fair value is based upon independent market prices, appraised values of the collateral, or management’s estimation of the value of the collateral. The Company records foreclosed assets as nonrecurring Level 3. | |||||||||||||||||||||
Repossessed Collateral: Repossessed collateral is adjusted to fair value, less estimated costs to sell, upon transfer of the loans to repossessions. Subsequently, repossessed assets are carried at the lower of the carrying value or the fair value, less estimated costs to sell. Fair value is based upon independent market prices, appraised values of the collateral, or management’s estimation of the value of the collateral. The Company records repossessed collateral as nonrecurring Level 3. | |||||||||||||||||||||
Mortgage Serving Rights: Mortgage servicing rights do not trade in an active market with readily observable market data. As a result, the Company estimates the fair value of mortgage servicing rights by using a discounted cash flow model to calculate the present value of estimated future net servicing income. The Company stratifies its mortgage servicing portfolio on the basis of loan type. The assumptions used in the discounted cash flow model are those that we believe market participants would use in estimating future net servicing income, including estimates of loan prepayment rates, servicing costs, ancillary income, impound account balances, and discount rates. Significant assumptions in the valuation of mortgage servicing rights include changes in interest rates, estimated loan repayment rates, and the timing of cash flows, among other factors. Mortgage servicing rights are classified as Level 3 measurements due to the use of significant unobservable inputs, as well as significant management judgment and estimation. | |||||||||||||||||||||
Assets measured at fair value on a nonrecurring basis as of September 30, 2013 and December 31, 2012 were: | |||||||||||||||||||||
(Dollars in thousands) | Quoted Prices in | Significant Other | Significant | ||||||||||||||||||
Active Markets for | Observable | Unobservable | |||||||||||||||||||
Identical Assets | Inputs | Inputs | |||||||||||||||||||
Description | 30-Sep-13 | (Level 1) | (Level 2) | (Level 3) | |||||||||||||||||
Nonrecurring: | |||||||||||||||||||||
OREO | $ | 2,942 | $ | — | $ | — | $ | 2,942 | |||||||||||||
Repossessed collateral | 590 | — | — | 590 | |||||||||||||||||
Impaired loans: | |||||||||||||||||||||
Commercial real estate | 8,496 | — | — | 8,496 | |||||||||||||||||
Faith-based non-profit | 17,020 | — | — | 17,020 | |||||||||||||||||
Residential real estate | 3,790 | — | — | 3,790 | |||||||||||||||||
Consumer | 13 | — | — | 13 | |||||||||||||||||
Mortgage Servicing Rights | 25 | — | — | 25 | |||||||||||||||||
Total | $ | 32,876 | $ | — | $ | — | $ | 32,876 | |||||||||||||
(Dollars in thousands) | Quoted Prices in | Significant Other | Significant | ||||||||||||||||||
Active Markets for | Observable | Unobservable | |||||||||||||||||||
Identical Assets | Inputs | Inputs | |||||||||||||||||||
Description | 31-Dec-12 | (Level 1) | (Level 2) | (Level 3) | |||||||||||||||||
Nonrecurring: | |||||||||||||||||||||
OREO | $ | 3,055 | $ | — | $ | — | $ | 3,055 | |||||||||||||
Repossessed collateral | 590 | — | — | 590 | |||||||||||||||||
Impaired loans: | |||||||||||||||||||||
Commercial real estate | 4,749 | — | — | 4,749 | |||||||||||||||||
Faith-based non-profit | 14,863 | — | — | 14,863 | |||||||||||||||||
Residential real estate | 3,916 | — | — | 3,916 | |||||||||||||||||
Consumer | 16 | — | — | 16 | |||||||||||||||||
Mortgage Servicing Rights | 36 | — | — | 36 | |||||||||||||||||
Total | $ | 27,225 | $ | — | $ | — | $ | 27,225 | |||||||||||||
Quantitative Information about Level 3 Fair Value Measurements | |||||||||||||||||||||
(Dollars in thousands) | Significant | Significant | |||||||||||||||||||
Valuation | Unobservable | Unobservable | |||||||||||||||||||
Description | 30-Sep-13 | Technique | Inputs | Input Value | |||||||||||||||||
Nonrecurring: | |||||||||||||||||||||
OREO | $ | 2,942 | discounted appraisals | collateral discounts | 6-20 | % | |||||||||||||||
Repossessed collateral | 590 | discounted appraisals | collateral discounts | 20-50 | % | ||||||||||||||||
Impaired loans | 29,319 | discounted appraisals | collateral discounts | 6-20 | % | ||||||||||||||||
Mortgage Servicing Rights | 25 | discounted cash flows | PSA speed | 426 | % | ||||||||||||||||
Total | $ | 32,876 | cost to service | 6 | % | ||||||||||||||||
discount rate | 10 | % | |||||||||||||||||||
(Dollars in thousands) | Significant | Significant | |||||||||||||||||||
Valuation | Unobservable | Unobservable | |||||||||||||||||||
Description | 31-Dec-12 | Technique | Inputs | Input Value | |||||||||||||||||
Nonrecurring: | |||||||||||||||||||||
OREO | $ | 3,055 | discounted appraisals | collateral discounts | 6-20 | % | |||||||||||||||
Repossessed collateral | 590 | discounted appraisals | collateral discounts | 20-50 | % | ||||||||||||||||
Impaired loans | 23,544 | discounted appraisals | collateral discounts | 6-20 | % | ||||||||||||||||
Mortgage Servicing Rights | 36 | discounted cash flows | PSA speed | 426 | % | ||||||||||||||||
Total | $ | 27,225 | cost to service | 6 | % | ||||||||||||||||
discount rate | 10 | % | |||||||||||||||||||
The Company discloses estimated fair values for its significant financial instruments. The methodologies for estimating the fair value of financial assets and liabilities that are measured at fair value on a recurring or non-recurring basis are discussed above. The methodologies for other financial assets and liabilities are discussed below. | |||||||||||||||||||||
The Company had no transfers between any of the three levels in 2012 or 2013. | |||||||||||||||||||||
Cash and Cash Equivalents: The carrying amount of cash, due from banks, and federal funds sold approximates fair value, and is therefore considered Level 1 input. | |||||||||||||||||||||
Loans (other than impaired), net of allowances for loan losses: Fair values are estimated for portfolios of loans with similar financial characteristics. The majority of the Company’s loans and lending-related commitments are not carried at fair value on a recurring basis on the Consolidated Balance Sheets, nor are they actively traded. | |||||||||||||||||||||
The fair value of performing loans is calculated by discounting scheduled cash flows through their individual contractual maturity, using discount rates that reflect the credit risk, overhead expenses, interest rate earned and again, contractual maturity of each loan. The maturity is based on contractual maturities for each loan, modified as required by an estimate of the effect of historical prepayments and current economic conditions. | |||||||||||||||||||||
For all loans, assumptions regarding the characteristics and segregation of loans, maturities, credit risk, cash flows, and discount rates are determined using specific borrower and other available information and are therefore considered a Level 3 input. | |||||||||||||||||||||
Accrued Interest Receivable and Payable: The fair value of interest receivable and payable is estimated to approximate the carrying amounts and is therefore considered a Level 1 input. | |||||||||||||||||||||
Deposits: The fair value of deposits with no stated maturity, such as demand deposits, checking accounts, savings and money market accounts, is equal to the carrying amount and is therefore considered a Level 1 input. The fair value of certificates of deposit is based on the discounted value of contractual cash flows, where the discount rate is estimated using the market rates currently offered for deposits of similar remaining maturities and is therefore considered a Level 2 input. | |||||||||||||||||||||
Borrowings: The fair value of borrowings is based on the discounted value of estimated cash flows. The discounted rate is estimated using market rates currently offered for similar advances or borrowings and is therefore considered a Level 3 input. | |||||||||||||||||||||
Off-Balance Sheet Instruments: Since the majority of the Company’s off-balance sheet instruments consist of non-fee-producing variable rate commitments, the Company has determined they do not have a distinguishable fair value. | |||||||||||||||||||||
As of September 30, 2013 and December 31, 2012, the carrying amounts and associated estimated fair value of financial assets and liabilities of the Company are as follows: | |||||||||||||||||||||
30-Sep-13 | |||||||||||||||||||||
(Dollars in thousands) | Carrying | Estimated | |||||||||||||||||||
(Unaudited) | Amount | Fair Value | Level 1 | Level 2 | Level 3 | ||||||||||||||||
Assets: | |||||||||||||||||||||
Cash and cash equivalents | $ | 29,362 | $ | 29,362 | $ | 29,362 | $ | — | $ | — | |||||||||||
Marketable securities | 57,938 | 57,938 | — | 57,938 | — | ||||||||||||||||
Loans, net of allowances for loan losses | 183,919 | 181,266 | 181,266 | ||||||||||||||||||
Accrued interest receivable | 862 | 862 | 862 | — | |||||||||||||||||
Liabilities: | |||||||||||||||||||||
Non-maturity deposits | $ | 118,500 | $ | 118,500 | 118,500 | — | — | ||||||||||||||
Maturity deposits | 131,375 | 130,992 | — | 130,992 | — | ||||||||||||||||
Other borrowings | 867 | 805 | — | — | 805 | ||||||||||||||||
Accrued interest payable | 90 | 90 | 90 | — | — | ||||||||||||||||
31-Dec-12 | |||||||||||||||||||||
(Dollars in thousands) | Carrying | Estimated | |||||||||||||||||||
Amount | Value | Level 1 | Level 2 | Level 3 | |||||||||||||||||
Assets: | |||||||||||||||||||||
Cash and cash equivalents | $ | 42,586 | $ | 42,586 | $ | 42,586 | $ | — | $ | — | |||||||||||
Marketable securities | 60,811 | 60,811 | — | 60,811 | — | ||||||||||||||||
Loans, net of allowances for loan losses | 171,723 | 175,041 | — | — | 175,041 | ||||||||||||||||
Accrued interest receivable | 858 | 858 | 858 | — | — | ||||||||||||||||
Liabilities: | |||||||||||||||||||||
Non-maturity deposits | $ | 116,276 | $ | 116,276 | 116,276 | — | — | ||||||||||||||
Maturity deposits | 134,603 | 134,322 | — | 134,322 | # | — | |||||||||||||||
Other borrowings | 2,937 | 2,871 | — | — | 2,871 | ||||||||||||||||
Accrued interest payable | 119 | 119 | 119 | — | — | ||||||||||||||||
SUMMARY_OF_SIGNIFICANT_ACCOUNT1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 9 Months Ended |
Sep. 30, 2013 | |
Summary Of Significant Accounting Policies Policies | ' |
Nature of Operations | ' |
Nature of Operations | |
M&F Bancorp, Inc. (the “Company”) is a bank holding company, and the parent company of Mechanics and Farmers Bank (the “Bank”), a state chartered commercial bank incorporated in North Carolina (“NC”) in 1907, which began operations in 1908. The Bank has seven branches in NC: two in Durham, two in Raleigh, and one each in Charlotte, Greensboro and Winston-Salem. The Company, headquartered in Durham, operates as a single business segment and offers a wide variety of consumer and commercial banking services and products almost exclusively in NC. | |
Basis of Presentation | ' |
Basis of Presentation | |
The Consolidated Financial Statements include the accounts and transactions of the Company and the Bank, the wholly owned subsidiary. All significant inter-company accounts and transactions have been eliminated in consolidation. | |
The Consolidated Financial Statements have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) for interim financial statements and in accordance with the instructions for Form 10-Q and Rule 8-03 of Regulation S-X. The accompanying Consolidated Financial Statements and Notes are unaudited except for the balance sheet and footnote information as of December 31, 2012, which were derived from the Company’s audited consolidated Annual Report on Form 10-K as of and for the year ended December 31, 2012. | |
The Consolidated Financial Statements included herein do not include all the information and notes required by GAAP and should be read in conjunction with the Consolidated Financial Statements and the related notes thereto included in the Company’s Annual Report on Form 10-K as of and for the year ended December 31, 2012. | |
In the opinion of management, the interim financial statements include all adjustments, consisting of normal recurring accruals, necessary for a fair presentation of the financial position, results of operations and cash flows in the Consolidated Financial Statements. The unaudited operating results for the periods presented may not be indicative of annual results. | |
Segment Reporting | ' |
Segment Reporting | |
Based on an analysis performed by the Company, management has determined that the Company has only one operating segment, which is commercial banking. The chief operating decision-maker uses consolidated results to make operating and strategic decisions and therefore, the Company is not required to disclose additional segment information. | |
Use of Estimates | ' |
Use of Estimates | |
The financial statements are prepared in accordance with GAAP, which require management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates. | |
New Accounting Pronouncements | ' |
New Accounting Pronouncements | |
The Financial Accounting Standards Board (“FASB”) amended the Comprehensive Income topic of the Accounting Standards Codification (“ASC”) in February 2013. The amendments address reporting of amounts reclassified out of accumulated other comprehensive income. Specifically, the amendments do not change the current requirements for reporting net income or other comprehensive income in financial statements. However, the amendments do require an entity to provide information about the amounts reclassified out of accumulated other comprehensive income by component. In addition, in certain circumstances an entity is required to present, either on the face of the statement where net income is presented or in the notes, significant amounts reclassified out of accumulated other comprehensive income by the respective line items of net income. The amendments were effective for the Company on a prospective basis for reporting periods beginning after December 15, 2012. The adoption of these amendments did not have a material effect on the consolidated financial statements of the Company, although new disclosures are included in these consolidated financial statements. | |
On April 22, 2013, the FASB issued guidance addressing application of the liquidation basis of accounting. The guidance is intended to clarify when an entity should apply the liquidation basis of accounting. In addition, the guidance provides principles for the recognition and measurement of assets and liabilities and requirements for financial statements prepared using the liquidation basis of accounting. The amendments will be effective for entities that determine liquidation is imminent during annual reporting periods beginning after December 15, 2013, and interim reporting periods therein and those requirements should be applied prospectively from the day that liquidation becomes imminent. Early adoption is permitted. The Company does not expect these amendments to have any effect on its financial statements. | |
Other accounting standards that have been issued or proposed by the FASB or other standards-setting bodies are not expected to have a material impact on the Company’s financial position, results of operations or cash flows. |
INVESTMENT_SECURITIES_Tables
INVESTMENT SECURITIES (Tables) | 9 Months Ended | ||||||||||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||||||||||
Investment Securities Tables | ' | ||||||||||||||||||||||||
Schedule of Investment Securities | ' | ||||||||||||||||||||||||
The amortized cost, gross unrealized gains and losses and fair values of investment securities at September 30, 2013 and December 31, 2012 were: | |||||||||||||||||||||||||
(Dollars in thousands) | Amortized | Gross | Gross | Fair Value | |||||||||||||||||||||
Cost | Unrealized | Unrealized | |||||||||||||||||||||||
Gains | Losses | ||||||||||||||||||||||||
(Unaudited) | |||||||||||||||||||||||||
30-Sep-13 | |||||||||||||||||||||||||
US government agencies | $ | 5,000 | $ | 7 | $ | (125 | ) | $ | 4,882 | ||||||||||||||||
Government sponsored MBS | |||||||||||||||||||||||||
Residential | 51,733 | 191 | (345 | ) | 51,579 | ||||||||||||||||||||
Municipal securities | |||||||||||||||||||||||||
North Carolina | 1,488 | 28 | (39 | ) | 1,477 | ||||||||||||||||||||
Total at September 30, 2013 | $ | 58,221 | $ | 226 | $ | (509 | ) | $ | 57,938 | ||||||||||||||||
31-Dec-12 | |||||||||||||||||||||||||
US government agencies | $ | 1,322 | $ | 5 | $ | — | $ | 1,327 | |||||||||||||||||
Government sponsored MBS | |||||||||||||||||||||||||
Residential | 57,333 | 627 | (29 | ) | 57,931 | ||||||||||||||||||||
North Carolina | 1,497 | 56 | — | 1,553 | |||||||||||||||||||||
Total at December 31, 2012 | $ | 60,152 | $ | 688 | $ | (29 | ) | $ | 60,811 | ||||||||||||||||
Schedule of Investment Securities maturities | ' | ||||||||||||||||||||||||
The amortized cost and estimated market values of securities as of September 30, 2013 and December 31, 2012 by contractual maturities are shown below. Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. MBS, which are not due at a single maturity date, are grouped based upon the final payment date. MBS may mature earlier because of principal prepayments. | |||||||||||||||||||||||||
(Dollars in thousands) | As of September 30, 2013 | ||||||||||||||||||||||||
(Unaudited) | Fair Value | Amortized Cost | |||||||||||||||||||||||
US government agencies | |||||||||||||||||||||||||
Due after one year through five years | $ | 3,004 | $ | 3,000 | |||||||||||||||||||||
Due after five years through ten years | 1,878 | 2,000 | |||||||||||||||||||||||
Total US government agencies | $ | 4,882 | $ | 5,000 | |||||||||||||||||||||
Government sponsored MBS | |||||||||||||||||||||||||
Residential | |||||||||||||||||||||||||
Due within one year | $ | 15,830 | $ | 15,882 | |||||||||||||||||||||
Due after one year through five years | 24,659 | 24,733 | |||||||||||||||||||||||
Due after five years through ten years | 7,484 | 7,513 | |||||||||||||||||||||||
Due after ten years | 3,606 | 3,605 | |||||||||||||||||||||||
Total government sponsored MBS | $ | 51,579 | $ | 51,733 | |||||||||||||||||||||
Municipal bonds | |||||||||||||||||||||||||
North Carolina | |||||||||||||||||||||||||
Due within one year | $ | 476 | $ | 466 | |||||||||||||||||||||
Due after one year through five years | 441 | 423 | |||||||||||||||||||||||
Due after five years through ten years | 560 | 599 | |||||||||||||||||||||||
Total North Carolina municipal bonds | $ | 1,477 | $ | 1,488 | |||||||||||||||||||||
(Dollars in thousands) | As of December 31, 2012 | ||||||||||||||||||||||||
Fair Value | Amortized Cost | ||||||||||||||||||||||||
US government agencies | |||||||||||||||||||||||||
Due within one year | $ | 1,005 | $ | 1,000 | |||||||||||||||||||||
Due after one year through five years | 322 | 322 | |||||||||||||||||||||||
Total US government agencies | $ | 1,327 | $ | 1,322 | |||||||||||||||||||||
Government sponsored MBS | |||||||||||||||||||||||||
Residential | |||||||||||||||||||||||||
Due within one year | |||||||||||||||||||||||||
Due after one year through five years | $ | 135 | $ | 126 | |||||||||||||||||||||
Due after five years through ten years | 171 | 161 | |||||||||||||||||||||||
Due after ten years | 57,625 | 57,046 | |||||||||||||||||||||||
Total government sponsored MBS | $ | 57,931 | $ | 57,333 | |||||||||||||||||||||
Municipal bonds | |||||||||||||||||||||||||
North Carolina | |||||||||||||||||||||||||
Due within one year | $ | 488 | $ | 466 | |||||||||||||||||||||
Due after one year through five years | 458 | 425 | |||||||||||||||||||||||
Due after five years through ten years | 607 | 606 | |||||||||||||||||||||||
Total North Carolina municipal bonds | $ | 1,553 | $ | 1,497 | |||||||||||||||||||||
Schedule of Securities in an unrealized los position | ' | ||||||||||||||||||||||||
As of September 30, 2013 and December 31, 2012, the fair value of securities with gross unrealized losses by length of time that the individual securities have been in an unrealized loss position is as follows: | |||||||||||||||||||||||||
(Dollars in thousands) | Less Than 12 Months | 12 Months or Greater | Total | ||||||||||||||||||||||
(Unaudited) | Fair Value | Unrealized | Fair Value | Unrealized | Fair Value | Unrealized | |||||||||||||||||||
Losses | Losses | Losses | |||||||||||||||||||||||
30-Sep-13 | |||||||||||||||||||||||||
US government agencies | $ | 2,875 | $ | (125 | ) | $ | — | $ | — | $ | 2,875 | $ | (125 | ) | |||||||||||
Government sponsored MBS | |||||||||||||||||||||||||
Residential | 34,354 | (345 | ) | 21 | — | 34,375 | (345 | ) | |||||||||||||||||
Municipal securities | |||||||||||||||||||||||||
North Carolina | 560 | (39 | ) | — | — | 560 | (39 | ) | |||||||||||||||||
Total at September 30, 2013 | $ | 37,789 | $ | (509 | ) | $ | 21 | $ | — | $ | 37,810 | $ | (509 | ) | |||||||||||
(Dollars in thousands) | Less Than 12 Months | 12 Months or Greater | Total | ||||||||||||||||||||||
Fair Value | Unrealized | Fair Value | Unrealized | Fair Value | Unrealized | ||||||||||||||||||||
Losses | Losses | Losses | |||||||||||||||||||||||
31-Dec-12 | |||||||||||||||||||||||||
Government sponsored MBS | |||||||||||||||||||||||||
Residential | $ | 8,027 | $ | (29 | ) | $ | 21 | $ | — | $ | 8,048 | $ | (29 | ) | |||||||||||
Total at December 31, 2012 | $ | 8,027 | $ | (29 | ) | $ | 21 | $ | — | $ | 8,048 | $ | (29 | ) |
ACCUMULATED_OTHER_COMPREHENSIV1
ACCUMULATED OTHER COMPREHENSIVE INCOME (Tables) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Equity [Abstract] | ' | ||||||||||||||||
Schedule of changes in Accumulated Other Comprehensive Income (Loss) by Component | ' | ||||||||||||||||
CHANGES IN ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) BY COMPONENT | |||||||||||||||||
For The Three And Nine Months Ended September 30, 2013 | |||||||||||||||||
(Dollars in thousands) | |||||||||||||||||
(Unaudited) | |||||||||||||||||
Unrealized | Defined | Total | |||||||||||||||
Gains and | Benefit | ||||||||||||||||
Losses on | Pension Items | ||||||||||||||||
Available-for- | |||||||||||||||||
Sale | |||||||||||||||||
Securities | |||||||||||||||||
Balance as of June 30, 2013 | $ | (8 | ) | $ | (1,834 | ) | $ | (1,842 | ) | ||||||||
Other comprehensive loss before reclassifications | (169 | ) | — | (169 | ) | ||||||||||||
Amounts reclassified from acumulated other comprehensive loss | — | — | — | ||||||||||||||
Net current-period other comprehensive loss | (169 | ) | — | (169 | ) | ||||||||||||
Balance as of September 30, 2013 | $ | (177 | ) | $ | (1,834 | ) | $ | (2,011 | ) | ||||||||
Balance as of December 31, 2012 | $ | 426 | $ | (1,834 | ) | $ | (1,408 | ) | |||||||||
Other comprehensive loss before reclassifications | (603 | ) | — | (603 | ) | ||||||||||||
Amounts reclassified from acumulated other comprehensive loss | — | — | — | ||||||||||||||
Net current-period other comprehensive loss | (603 | ) | — | (603 | ) | ||||||||||||
Balance as of September 30, 2013 | $ | (177 | ) | $ | (1,834 | ) | $ | (2,011 | ) |
LOANS_AND_ALLOWANCE_FOR_LOAN_L1
LOANS AND ALLOWANCE FOR LOAN LOSSES (Tables) | 9 Months Ended | ||||||||||||||||||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||||||||||||||||||
Loans And Allowance For Loan Losses Tables | ' | ||||||||||||||||||||||||||||||||
Schedule of Allowance for Loan Losses | ' | ||||||||||||||||||||||||||||||||
The activity in the Allowance for Loan Losses (“ALLL”) for the three and nine months ended September 30, 2013 and 2012 and related asset balances at September 30, 2013 and December 31, 2012 is summarized as follows: | |||||||||||||||||||||||||||||||||
For the Three Months Ended September 30, 2013 | |||||||||||||||||||||||||||||||||
Faith- | |||||||||||||||||||||||||||||||||
Based | Residential | ||||||||||||||||||||||||||||||||
Commercial | Non- | Real | Other | ||||||||||||||||||||||||||||||
(Dollars in thousands) | Commercial | Real Estate | Profit | Estate | Consumer | Loans | Unallocated | Total | |||||||||||||||||||||||||
ALLL: | |||||||||||||||||||||||||||||||||
Beginning of quarter balance | $ | 241 | $ | 806 | $ | 1,278 | $ | 831 | $ | 22 | $ | 43 | $ | 13 | $ | 3,234 | |||||||||||||||||
Charge-offs | — | — | — | (40 | ) | (1 | ) | (4 | ) | — | (45 | ) | |||||||||||||||||||||
Recoveries | — | 25 | — | 4 | 6 | 3 | — | 38 | |||||||||||||||||||||||||
Provision for loan losses | 203 | 52 | (170 | ) | (57 | ) | (8 | ) | 3 | (13 | ) | 10 | |||||||||||||||||||||
Balance at September 30, 2013 | $ | 444 | $ | 883 | $ | 1,108 | $ | 738 | $ | 19 | $ | 45 | $ | — | $ | 3,237 | |||||||||||||||||
For the Three Months Ended September 30, 2012 | |||||||||||||||||||||||||||||||||
Faith- | |||||||||||||||||||||||||||||||||
Based | Residential | ||||||||||||||||||||||||||||||||
Commercial | Non- | Real | Other | ||||||||||||||||||||||||||||||
(Dollars in thousands) | Commercial | Real Estate | Profit | Estate | Consumer | Loans | Unallocated | Total | |||||||||||||||||||||||||
ALLL: | |||||||||||||||||||||||||||||||||
Beginning of quarter balance | $ | 61 | $ | 1,187 | $ | 1,091 | $ | 1,243 | $ | 46 | $ | 51 | $ | — | $ | 3,679 | |||||||||||||||||
Charge-offs | — | — | — | (303 | ) | — | (8 | ) | — | (311 | ) | ||||||||||||||||||||||
Recoveries | — | — | — | 4 | 4 | — | — | 8 | |||||||||||||||||||||||||
Provision for loan losses | (36 | ) | (18 | ) | (60 | ) | 230 | 2 | 4 | — | 122 | ||||||||||||||||||||||
Balance at September 30, 2012 | $ | 25 | $ | 1,169 | $ | 1,031 | $ | 1,174 | $ | 52 | $ | 47 | $ | — | $ | 3,498 | |||||||||||||||||
For the Nine Months Ended September 30, 2013 | |||||||||||||||||||||||||||||||||
Faith- | |||||||||||||||||||||||||||||||||
Based | Residential | ||||||||||||||||||||||||||||||||
Commercial | Non- | Real | Other | ||||||||||||||||||||||||||||||
(Dollars in thousands) | Commercial | Real Estate | Profit | Estate | Consumer | Loans | Unallocated | Total | |||||||||||||||||||||||||
ALLL: | |||||||||||||||||||||||||||||||||
Beginning of year balance | $ | 90 | $ | 881 | $ | 1,246 | $ | 937 | $ | 30 | $ | 54 | $ | 261 | $ | 3,499 | |||||||||||||||||
Charge-offs | — | (237 | ) | — | (73 | ) | (3 | ) | (14 | ) | — | (327 | ) | ||||||||||||||||||||
Recoveries | — | 27 | — | 12 | 7 | 9 | — | 55 | |||||||||||||||||||||||||
Provision for loan losses | 354 | 212 | (138 | ) | (138 | ) | (15 | ) | (4 | ) | (261 | ) | 10 | ||||||||||||||||||||
Balance at September 30, 2013 | $ | 444 | $ | 883 | $ | 1,108 | $ | 738 | $ | 19 | $ | 45 | $ | — | $ | 3,237 | |||||||||||||||||
For the Nine Months Ended September 30, 2012 | |||||||||||||||||||||||||||||||||
Faith- | |||||||||||||||||||||||||||||||||
Based | Residential | ||||||||||||||||||||||||||||||||
Commercial | Non- | Real | Other | ||||||||||||||||||||||||||||||
(Dollars in thousands) | Commercial | Real Estate | Profit | Estate | Consumer | Loans | Unallocated | Total | |||||||||||||||||||||||||
ALLL: | |||||||||||||||||||||||||||||||||
Beginning of year balance | $ | 348 | $ | 971 | $ | 1,128 | $ | 1,299 | $ | 62 | $ | 42 | $ | — | $ | 3,850 | |||||||||||||||||
Charge-offs | — | (56 | ) | — | (539 | ) | (1 | ) | (26 | ) | — | (622 | ) | ||||||||||||||||||||
Recoveries | — | 1 | 93 | 1 | 9 | — | 104 | ||||||||||||||||||||||||||
Provision for loan losses | (323 | ) | 253 | (97 | ) | 321 | (10 | ) | 22 | — | 166 | ||||||||||||||||||||||
Balance at September 30, 2012 | $ | 25 | $ | 1,169 | $ | 1,031 | $ | 1,174 | $ | 52 | $ | 47 | $ | — | $ | 3,498 | |||||||||||||||||
Schedule of Loans evaluated for impairment | ' | ||||||||||||||||||||||||||||||||
30-Sep-13 | |||||||||||||||||||||||||||||||||
Faith | |||||||||||||||||||||||||||||||||
Based | |||||||||||||||||||||||||||||||||
Commercial | Non- | Residential | Other | ||||||||||||||||||||||||||||||
(Dollars in thousands) | Commercial | Real Estate | Profit | Real Estate | Consumer | Loans | Unallocated | Total | |||||||||||||||||||||||||
ALLL: | |||||||||||||||||||||||||||||||||
Ending ALLL balance attributable to loans: | |||||||||||||||||||||||||||||||||
Individually evaluated for impairment | $ | — | $ | — | $ | 87 | $ | 265 | $ | — | $ | — | $ | — | $ | 352 | |||||||||||||||||
Collectively evaluated for impairment | 444 | 883 | 1,021 | 473 | 19 | 45 | — | 2,885 | |||||||||||||||||||||||||
Total ending ALLL balance | $ | 444 | $ | 883 | $ | 1,108 | $ | 738 | $ | 19 | $ | 45 | $ | — | $ | 3,237 | |||||||||||||||||
Loans: | |||||||||||||||||||||||||||||||||
Loans individually evaluated for impairment | $ | — | $ | 8,476 | $ | 17,052 | $ | 4,051 | $ | 12 | $ | — | $ | — | $ | 29,591 | |||||||||||||||||
Loans collectively evaluated for imapirment | 12,658 | 46,381 | 68,875 | 26,024 | 1,200 | 2,427 | — | 157,565 | |||||||||||||||||||||||||
Total ending loans balance | $ | 12,658 | $ | 54,857 | $ | 85,927 | $ | 30,075 | $ | 1,212 | $ | 2,427 | $ | — | $ | 187,156 | |||||||||||||||||
31-Dec-12 | |||||||||||||||||||||||||||||||||
Faith | |||||||||||||||||||||||||||||||||
Based | |||||||||||||||||||||||||||||||||
Commercial | Non- | Residential | Other | ||||||||||||||||||||||||||||||
(Dollars in thousands) | Commercial | Real Estate | Profit | Real Estate | Consumer | Loans | Unallocated | Total | |||||||||||||||||||||||||
ALLL: | |||||||||||||||||||||||||||||||||
Ending ALLL balance attributable to loans: | |||||||||||||||||||||||||||||||||
Individually evaluated for impairment | $ | — | $ | 87 | $ | 44 | $ | 349 | $ | — | $ | — | $ | — | $ | 480 | |||||||||||||||||
Collectively evaluated for impairment | 90 | 794 | 1,202 | 588 | 30 | 54 | 261 | 3,019 | |||||||||||||||||||||||||
Total ending ALLL balance | $ | 90 | $ | 881 | $ | 1,246 | $ | 937 | $ | 30 | $ | 54 | $ | 261 | $ | 3,499 | |||||||||||||||||
Loans: | |||||||||||||||||||||||||||||||||
Loans individually evaluated for impairment | $ | — | $ | 4,837 | $ | 14,907 | $ | 2,443 | $ | 16 | $ | — | $ | — | $ | 22,203 | |||||||||||||||||
Loans collectively evaluated for impairment | 3,282 | 43,332 | 70,990 | 31,331 | 1,330 | 2,754 | — | 153,019 | |||||||||||||||||||||||||
Total ending loans balance | $ | 3,282 | $ | 48,169 | $ | 85,897 | $ | 33,774 | $ | 1,346 | $ | 2,754 | $ | — | $ | 175,222 | |||||||||||||||||
Loan Portfolio Schedule | ' | ||||||||||||||||||||||||||||||||
The composition of the loan portfolio, net of deferred fees and costs, by loan classification as of September 30, 2013 and December 31, 2012 was as follows: | |||||||||||||||||||||||||||||||||
(Dollars in thousands) | 30-Sep-13 | 31-Dec-12 | |||||||||||||||||||||||||||||||
Commercial | $ | 12,658 | $ | 3,282 | |||||||||||||||||||||||||||||
Commercial real estate: | |||||||||||||||||||||||||||||||||
Construction | 4,359 | 3,621 | |||||||||||||||||||||||||||||||
Owner occupied | 21,649 | 18,377 | |||||||||||||||||||||||||||||||
Other | 28,849 | 26,171 | |||||||||||||||||||||||||||||||
Faith-based non-profit | |||||||||||||||||||||||||||||||||
Construction | — | 2,344 | |||||||||||||||||||||||||||||||
Owner Occupied | 79,447 | 76,418 | |||||||||||||||||||||||||||||||
Other | 6,480 | 7,135 | |||||||||||||||||||||||||||||||
Residential real estate: | |||||||||||||||||||||||||||||||||
First mortgage | 23,159 | 24,702 | |||||||||||||||||||||||||||||||
Multifamily | 3,776 | 5,828 | |||||||||||||||||||||||||||||||
Home equity | 3,140 | 3,161 | |||||||||||||||||||||||||||||||
Construction | — | 83 | |||||||||||||||||||||||||||||||
Consumer | 1,212 | 1,346 | |||||||||||||||||||||||||||||||
Other loans | 2,427 | 2,754 | |||||||||||||||||||||||||||||||
Loans, net of deferred fees | 187,156 | 175,222 | |||||||||||||||||||||||||||||||
ALLL | (3,237 | ) | (3,499 | ) | |||||||||||||||||||||||||||||
Loans, net of ALLL | $ | 183,919 | $ | 171,723 | |||||||||||||||||||||||||||||
Aging schedule of recorded investment in loans | ' | ||||||||||||||||||||||||||||||||
The following tables show past due loans at September 30, 2013 and December 31, 2012: | |||||||||||||||||||||||||||||||||
30-Sep-13 | 90 Days | ||||||||||||||||||||||||||||||||
30-59 Days | 60-89 Days | Or More | Total Past | ||||||||||||||||||||||||||||||
(Dollars in thousands) | Past Due | Past Due | Past Due | Due | Current | Total | |||||||||||||||||||||||||||
Commercial | $ | 4 | $ | 5 | $ | 2 | $ | 11 | $ | 12,647 | $ | 12,658 | |||||||||||||||||||||
Commercial real estate: | |||||||||||||||||||||||||||||||||
Construction | — | — | — | — | 4,359 | 4,359 | |||||||||||||||||||||||||||
Owner occupied | — | — | 129 | 129 | 21,520 | 21,649 | |||||||||||||||||||||||||||
Other | — | — | 572 | 572 | 28,277 | 28,849 | |||||||||||||||||||||||||||
Faith-based non-profit | |||||||||||||||||||||||||||||||||
Construction | — | — | — | — | — | — | |||||||||||||||||||||||||||
Owner Occupied | 613 | — | — | 613 | 78,834 | 79,447 | |||||||||||||||||||||||||||
Other | — | — | — | — | 6,480 | 6,480 | |||||||||||||||||||||||||||
Residential real estate: | |||||||||||||||||||||||||||||||||
First mortgage | 75 | — | 1,148 | 1,223 | 21,936 | 23,159 | |||||||||||||||||||||||||||
Multifamily | — | — | — | — | 3,776 | 3,776 | |||||||||||||||||||||||||||
Home equity | 256 | 94 | 19 | 369 | 2,771 | 3,140 | |||||||||||||||||||||||||||
Construction | — | — | — | — | — | — | |||||||||||||||||||||||||||
Consumer | 13 | — | — | 13 | 1,199 | 1,212 | |||||||||||||||||||||||||||
Other loans | — | — | — | — | 2,427 | 2,427 | |||||||||||||||||||||||||||
Total | $ | 961 | $ | 99 | $ | 1,870 | $ | 2,930 | $ | 184,226 | $ | 187,156 | |||||||||||||||||||||
31-Dec-12 | 90 Days | ||||||||||||||||||||||||||||||||
30-59 Days | 60-89 Days | Or More | Total Past | ||||||||||||||||||||||||||||||
(Dollars in thousands) | Past Due | Past Due | Past Due | Due | Current | Total | |||||||||||||||||||||||||||
Commercial | $ | — | $ | 353 | $ | — | $ | 353 | $ | 2,929 | $ | 3,282 | |||||||||||||||||||||
Commercial real estate: | |||||||||||||||||||||||||||||||||
Construction | — | — | — | — | 3,621 | 3,621 | |||||||||||||||||||||||||||
Owner occupied | — | — | 263 | 263 | 18,114 | 18,377 | |||||||||||||||||||||||||||
Other | 1,570 | 856 | 400 | 2,826 | 23,345 | 26,171 | |||||||||||||||||||||||||||
Faith-based non-profit | |||||||||||||||||||||||||||||||||
Construction | — | — | — | — | 2,344 | 2,344 | |||||||||||||||||||||||||||
Owner Occupied | 1,845 | — | 661 | 2,506 | 73,912 | 76,418 | |||||||||||||||||||||||||||
Other | — | — | — | — | 7,135 | 7,135 | |||||||||||||||||||||||||||
Residential real estate: | |||||||||||||||||||||||||||||||||
First mortgage | 787 | 548 | 2,812 | 4,147 | 20,555 | 24,702 | |||||||||||||||||||||||||||
Multifamily | — | — | — | — | 5,828 | 5,828 | |||||||||||||||||||||||||||
Home equity | 122 | 120 | 108 | 350 | 2,811 | 3,161 | |||||||||||||||||||||||||||
Construction | — | — | — | — | 83 | 83 | |||||||||||||||||||||||||||
Consumer | 8 | 9 | — | 17 | 1,329 | 1,346 | |||||||||||||||||||||||||||
Other loans | — | — | — | — | 2,754 | 2,754 | |||||||||||||||||||||||||||
Total | $ | 4,332 | $ | 1,886 | $ | 4,244 | $ | 10,462 | $ | 164,760 | $ | 175,222 | |||||||||||||||||||||
Schedule of Impaired Loans | ' | ||||||||||||||||||||||||||||||||
The recorded investment and related information for impaired loans is summarized as follows for September 30, 2013, September 30, 2012 and December 31, 2012: | |||||||||||||||||||||||||||||||||
30-Sep-13 | |||||||||||||||||||||||||||||||||
At end of period | For Nine Months Ended | For Three Months Ended | |||||||||||||||||||||||||||||||
Unpaid | Interest | Average | Interest | Average | |||||||||||||||||||||||||||||
Principal | Recorded | ALLL | Income | Recorded | Income | Recorded | |||||||||||||||||||||||||||
(Dollars in thousands) | Balance | Investment | Allocated | Recognized | Investment | Recognized | Investment | ||||||||||||||||||||||||||
With no related allowance recorded: | |||||||||||||||||||||||||||||||||
Commercial | $ | — | $ | — | $ | — | $ | — | $ | 98 | $ | — | $ | — | |||||||||||||||||||
Commercial real estate: | |||||||||||||||||||||||||||||||||
Construction | 362 | 364 | — | 21 | 276 | 10 | 274 | ||||||||||||||||||||||||||
Owner occupied | 3,418 | 3,184 | — | 84 | 706 | 67 | 1,067 | ||||||||||||||||||||||||||
Other | 4,931 | 4,948 | — | 170 | 4,265 | 56 | 4,025 | ||||||||||||||||||||||||||
Faith based non-profit: | |||||||||||||||||||||||||||||||||
Construction | — | — | — | — | — | — | — | ||||||||||||||||||||||||||
Owner occupied | 16,593 | 16,648 | — | 663 | 10,764 | 365 | 11,511 | ||||||||||||||||||||||||||
Other | — | — | — | — | — | — | — | ||||||||||||||||||||||||||
Residential real estate: | |||||||||||||||||||||||||||||||||
First mortgage | 2,712 | 2,680 | — | 155 | 1,668 | 145 | 2,120 | ||||||||||||||||||||||||||
Multifamily | — | — | — | — | — | — | — | ||||||||||||||||||||||||||
Home equity | 8 | 8 | — | — | 50 | — | 30 | ||||||||||||||||||||||||||
Construction | — | — | — | — | — | — | — | ||||||||||||||||||||||||||
Consumer | 12 | 13 | — | — | 7 | — | 10 | ||||||||||||||||||||||||||
Impaired loans with no allowance recorded | $ | 28,036 | $ | 27,845 | $ | — | $ | 1,093 | $ | 17,834 | $ | 643 | $ | 19,037 | |||||||||||||||||||
With an allowance recorded: | |||||||||||||||||||||||||||||||||
Commercial | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | |||||||||||||||||||
Commercial real estate: | |||||||||||||||||||||||||||||||||
Construction | — | — | — | — | — | — | — | ||||||||||||||||||||||||||
Owner occupied | — | — | — | — | 59 | — | 59 | ||||||||||||||||||||||||||
Other | — | — | — | — | 334 | — | — | ||||||||||||||||||||||||||
Faith based non-profit: | |||||||||||||||||||||||||||||||||
Construction | — | — | — | — | — | — | — | ||||||||||||||||||||||||||
Owner occupied | 458 | 459 | 87 | 29 | 364 | — | 442 | ||||||||||||||||||||||||||
Other | — | — | — | — | — | — | — | ||||||||||||||||||||||||||
Residential real estate: | |||||||||||||||||||||||||||||||||
First mortgage | 1,273 | 1,276 | 239 | 58 | 877 | 58 | 960 | ||||||||||||||||||||||||||
Multifamily | — | — | — | — | — | — | — | ||||||||||||||||||||||||||
Home equity | 91 | 91 | 26 | 4 | 23 | 4 | 46 | ||||||||||||||||||||||||||
Construction | — | — | — | — | — | — | — | ||||||||||||||||||||||||||
Consumer | — | — | — | — | — | — | — | ||||||||||||||||||||||||||
Impaired loans with allowance recorded | $ | 1,822 | $ | 1,826 | $ | 352 | $ | 91 | $ | 1,657 | $ | 62 | $ | 1,507 | |||||||||||||||||||
Impaired loans | $ | 29,858 | $ | 29,671 | $ | 352 | $ | 1,184 | $ | 19,491 | $ | 705 | $ | 20,544 | |||||||||||||||||||
30-Sep-12 | |||||||||||||||||||||||||||||||||
At end of period | For Nine Months Ended | For Three Months Ended | |||||||||||||||||||||||||||||||
Unpaid | Interest | Average | Interest | Average | |||||||||||||||||||||||||||||
Principal | Recorded | ALLL | Income | Recorded | Income | Recorded | |||||||||||||||||||||||||||
(Dollars in thousands) | Balance | Investment | Allocated | Recognized | Investment | Recognized | Investment | ||||||||||||||||||||||||||
With no related allowance recorded: | |||||||||||||||||||||||||||||||||
Commercial | $ | 1,567 | $ | 590 | $ | — | $ | — | $ | 590 | $ | — | $ | 590 | |||||||||||||||||||
Commercial real estate: | |||||||||||||||||||||||||||||||||
Construction | 374 | 374 | — | 24 | 499 | 7 | 374 | ||||||||||||||||||||||||||
Owner occupied | 551 | 551 | — | 28 | 805 | 6 | 638 | ||||||||||||||||||||||||||
Other | 4,962 | 5,964 | — | 143 | 5,162 | 58 | 5,832 | ||||||||||||||||||||||||||
Faith based non-profit: | |||||||||||||||||||||||||||||||||
Construction | — | — | — | — | — | — | — | ||||||||||||||||||||||||||
Owner occupied | 13,133 | 13,126 | — | 331 | 12,384 | 69 | 13,171 | ||||||||||||||||||||||||||
Other | — | — | — | — | — | — | — | ||||||||||||||||||||||||||
Residential real estate: | |||||||||||||||||||||||||||||||||
First mortgage | 889 | 889 | — | 18 | 797 | 4 | 834 | ||||||||||||||||||||||||||
Multifamily | — | — | — | — | — | — | — | ||||||||||||||||||||||||||
Home equity | — | — | — | — | — | — | — | ||||||||||||||||||||||||||
Construction | — | — | — | — | — | — | — | ||||||||||||||||||||||||||
Consumer | — | — | — | — | — | — | — | ||||||||||||||||||||||||||
Impaired loans with no allowance recorded | $ | 21,476 | $ | 21,494 | $ | — | $ | 544 | $ | 20,237 | $ | 144 | $ | 21,439 | |||||||||||||||||||
With an allowance recorded: | |||||||||||||||||||||||||||||||||
Commercial | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | |||||||||||||||||||
Commercial real estate: | |||||||||||||||||||||||||||||||||
Construction | — | — | — | — | 283 | — | 189 | ||||||||||||||||||||||||||
Owner occupied | 239 | 239 | 102 | 12 | 468 | 3 | 241 | ||||||||||||||||||||||||||
Other | 2,005 | 2,005 | 211 | 91 | 625 | 6 | 1,211 | ||||||||||||||||||||||||||
Faith based non-profit: | |||||||||||||||||||||||||||||||||
Construction | — | — | — | — | — | — | — | ||||||||||||||||||||||||||
Owner occupied | 430 | 430 | 52 | 22 | 788 | 5 | 667 | ||||||||||||||||||||||||||
Other | — | — | — | — | — | — | — | ||||||||||||||||||||||||||
Residential real estate: | |||||||||||||||||||||||||||||||||
First mortgage | 1,298 | 1,298 | 342 | 44 | 731 | 12 | 666 | ||||||||||||||||||||||||||
Multifamily | — | — | — | — | — | — | — | ||||||||||||||||||||||||||
Home equity | — | — | — | — | 231 | — | — | ||||||||||||||||||||||||||
Construction | — | — | — | — | — | — | — | ||||||||||||||||||||||||||
Consumer | — | — | — | — | 1 | — | — | ||||||||||||||||||||||||||
Impaired loans with allowance recorded | $ | 3,972 | $ | 3,972 | $ | 707 | $ | 169 | $ | 3,127 | $ | 26 | $ | 2,974 | |||||||||||||||||||
Impaired loans | $ | 25,448 | $ | 25,466 | $ | 707 | $ | 713 | $ | 23,364 | $ | 170 | $ | 24,413 | |||||||||||||||||||
31-Dec-12 | |||||||||||||||||||||||||||||||||
At end of period | For Period Ended | ||||||||||||||||||||||||||||||||
Unpaid | Interest | Average | |||||||||||||||||||||||||||||||
Principal | Recorded | ALLL | Income | Recorded | |||||||||||||||||||||||||||||
(Dollars in thousands) | Balance | Investment | Allocated | Recognized | Investment | ||||||||||||||||||||||||||||
With no related allowance recorded: | |||||||||||||||||||||||||||||||||
Commercial | $ | — | $ | — | $ | — | $ | — | $ | 295 | |||||||||||||||||||||||
Commercial real estate: | |||||||||||||||||||||||||||||||||
Construction | 371 | 371 | — | 31 | 300 | ||||||||||||||||||||||||||||
Owner occupied | 530 | 530 | — | 38 | 635 | ||||||||||||||||||||||||||||
Other | 4,312 | 3,698 | — | 129 | 4,473 | ||||||||||||||||||||||||||||
Faith based non-profit: | |||||||||||||||||||||||||||||||||
Construction | — | — | — | — | — | ||||||||||||||||||||||||||||
Owner occupied | 14,479 | 14,479 | — | 567 | 12,261 | ||||||||||||||||||||||||||||
Other | — | — | — | — | 1,611 | ||||||||||||||||||||||||||||
Residential real estate: | |||||||||||||||||||||||||||||||||
First mortgage | 814 | 814 | — | 19 | 2,671 | ||||||||||||||||||||||||||||
Multifamily | — | — | — | — | — | ||||||||||||||||||||||||||||
Home equity | 86 | 86 | — | 3 | 111 | ||||||||||||||||||||||||||||
Construction | — | — | — | — | — | ||||||||||||||||||||||||||||
Consumer | 16 | 16 | — | — | 4 | ||||||||||||||||||||||||||||
Impaired loans with no allowance recorded | $ | 20,608 | $ | 19,994 | $ | — | $ | 787 | $ | 22,361 | |||||||||||||||||||||||
With an allowance recorded: | |||||||||||||||||||||||||||||||||
Commercial | $ | — | $ | — | $ | — | $ | — | $ | — | |||||||||||||||||||||||
Commercial real estate: | |||||||||||||||||||||||||||||||||
Construction | — | — | — | — | — | ||||||||||||||||||||||||||||
Owner occupied | 238 | 238 | 87 | 15 | 60 | ||||||||||||||||||||||||||||
Other | — | — | — | — | 500 | ||||||||||||||||||||||||||||
Faith based non-profit: | |||||||||||||||||||||||||||||||||
Construction | — | — | — | — | 214 | ||||||||||||||||||||||||||||
Owner occupied | 428 | 428 | 44 | 30 | — | ||||||||||||||||||||||||||||
Other | — | — | — | — | — | ||||||||||||||||||||||||||||
Residential real estate: | |||||||||||||||||||||||||||||||||
First mortgage | 1,543 | 1,543 | 349 | 45 | 757 | ||||||||||||||||||||||||||||
Multifamily | — | — | — | — | — | ||||||||||||||||||||||||||||
Home equity | — | — | — | — | — | ||||||||||||||||||||||||||||
Construction | — | — | — | — | — | ||||||||||||||||||||||||||||
Consumer | — | — | — | — | — | ||||||||||||||||||||||||||||
Impaired loans with allowance recorded | $ | 2,209 | $ | 2,209 | $ | 480 | $ | 90 | $ | 1,531 | |||||||||||||||||||||||
Impaired loans | $ | 22,817 | $ | 22,203 | $ | 480 | $ | 877 | $ | 23,892 | |||||||||||||||||||||||
Schedule of Past Due loans and non-accrual loans | ' | ||||||||||||||||||||||||||||||||
The following table presents the recorded investment in non-accrual loans and loans past due over 90 days still on accrual by class of loans as of September 30, 2013 and December 31, 2012, respectively: | |||||||||||||||||||||||||||||||||
90 Days | |||||||||||||||||||||||||||||||||
or More | |||||||||||||||||||||||||||||||||
Past Due | |||||||||||||||||||||||||||||||||
30-Sep-13 | Still | ||||||||||||||||||||||||||||||||
(Dollars in thousands) | Non-accrual | Number | Accruing | Number | |||||||||||||||||||||||||||||
Commercial | $ | 2 | 1 | $ | — | — | |||||||||||||||||||||||||||
Commercial real estate: | |||||||||||||||||||||||||||||||||
Construction | — | — | — | — | |||||||||||||||||||||||||||||
Owner occupied | 78 | 2 | 52 | 1 | |||||||||||||||||||||||||||||
Other | 45 | 1 | 526 | 3 | |||||||||||||||||||||||||||||
Faith-based non-profit | |||||||||||||||||||||||||||||||||
Construction | — | — | — | — | |||||||||||||||||||||||||||||
Owner Occupied | 1,285 | 2 | — | — | |||||||||||||||||||||||||||||
Other | — | — | — | — | |||||||||||||||||||||||||||||
Residential real estate: | |||||||||||||||||||||||||||||||||
First mortgage | 3,092 | 39 | 814 | 16 | |||||||||||||||||||||||||||||
Multifamily | — | — | — | — | |||||||||||||||||||||||||||||
Home equity | 14 | 3 | 19 | 1 | |||||||||||||||||||||||||||||
Construction | — | — | — | — | |||||||||||||||||||||||||||||
Consumer | 12 | 2 | — | — | |||||||||||||||||||||||||||||
Other loans | — | — | — | — | |||||||||||||||||||||||||||||
Total | $ | 4,528 | 50 | $ | 1,411 | 21 | |||||||||||||||||||||||||||
90 Days | |||||||||||||||||||||||||||||||||
or More | |||||||||||||||||||||||||||||||||
Past Due | |||||||||||||||||||||||||||||||||
31-Dec-12 | Still | ||||||||||||||||||||||||||||||||
(Dollars in thousands) | Non-accrual | Number | Accruing | Number | |||||||||||||||||||||||||||||
Commercial | $ | — | — | $ | — | — | |||||||||||||||||||||||||||
Commercial real estate: | |||||||||||||||||||||||||||||||||
Construction | — | — | — | — | |||||||||||||||||||||||||||||
Owner occupied | 39 | 1 | 224 | 4 | |||||||||||||||||||||||||||||
Other | 49 | 1 | 351 | 1 | |||||||||||||||||||||||||||||
Faith-based non-profit | |||||||||||||||||||||||||||||||||
Construction | — | — | — | — | |||||||||||||||||||||||||||||
Owner Occupied | 5,241 | 4 | 661 | 3 | |||||||||||||||||||||||||||||
Other | — | — | — | — | |||||||||||||||||||||||||||||
Residential real estate: | |||||||||||||||||||||||||||||||||
First mortgage | 3,384 | 44 | 357 | 6 | |||||||||||||||||||||||||||||
Multifamily | — | — | — | — | |||||||||||||||||||||||||||||
Home equity | 3 | 1 | 101 | 1 | |||||||||||||||||||||||||||||
Construction | — | — | — | — | |||||||||||||||||||||||||||||
Consumer | 16 | 2 | — | — | |||||||||||||||||||||||||||||
Other loans | — | — | — | — | |||||||||||||||||||||||||||||
Total | $ | 8,732 | 53 | $ | 1,694 | 15 | |||||||||||||||||||||||||||
Loans by risk category | ' | ||||||||||||||||||||||||||||||||
The following is a breakdown of loans by risk categories at September 30, 2013 and December 31, 2012: | |||||||||||||||||||||||||||||||||
30-Sep-13 | |||||||||||||||||||||||||||||||||
(Dollars in thousands) | Pass | Special Mention | Substandard | Doubtful | Total | ||||||||||||||||||||||||||||
Commercial | $ | 9,802 | $ | 2,850 | $ | 6 | $ | — | $ | 12,658 | |||||||||||||||||||||||
Commercial real estate: | |||||||||||||||||||||||||||||||||
Construction | 3,812 | — | 547 | — | 4,359 | ||||||||||||||||||||||||||||
Owner occupied | 17,023 | 608 | 4,018 | — | 21,649 | ||||||||||||||||||||||||||||
Other | 24,326 | 961 | 3,562 | — | 28,849 | ||||||||||||||||||||||||||||
Faith-based non-profit | |||||||||||||||||||||||||||||||||
Construction | — | — | — | — | — | ||||||||||||||||||||||||||||
Owner Occupied | 65,252 | 8,255 | 5,940 | — | 79,447 | ||||||||||||||||||||||||||||
Other | 6,478 | 2 | — | — | 6,480 | ||||||||||||||||||||||||||||
Residential real estate: | |||||||||||||||||||||||||||||||||
First mortgage | 18,832 | 684 | 3,643 | — | 23,159 | ||||||||||||||||||||||||||||
Multifamily | 3,675 | 39 | 62 | — | 3,776 | ||||||||||||||||||||||||||||
Home equity | 2,820 | — | 320 | — | 3,140 | ||||||||||||||||||||||||||||
Construction | — | — | — | — | — | ||||||||||||||||||||||||||||
Consumer | 1,194 | — | 18 | — | 1,212 | ||||||||||||||||||||||||||||
Other loans | 2,427 | — | — | — | 2,427 | ||||||||||||||||||||||||||||
Total | $ | 155,641 | $ | 13,399 | $ | 18,116 | $ | — | $ | 187,156 | |||||||||||||||||||||||
31-Dec-12 | |||||||||||||||||||||||||||||||||
(Dollars in thousands) | Pass | Special Mention | Substandard | Doubtful | Total | ||||||||||||||||||||||||||||
Commercial | $ | 3,274 | $ | — | $ | 8 | $ | — | $ | 3,282 | |||||||||||||||||||||||
Commercial real estate: | |||||||||||||||||||||||||||||||||
Construction | 3,065 | — | 556 | — | 3,621 | ||||||||||||||||||||||||||||
Owner occupied | 13,379 | 3,151 | 1,847 | — | 18,377 | ||||||||||||||||||||||||||||
Other | 21,582 | 966 | 3,623 | — | 26,171 | ||||||||||||||||||||||||||||
Faith-based non-profit | |||||||||||||||||||||||||||||||||
Construction | 2,344 | — | — | — | 2,344 | ||||||||||||||||||||||||||||
Owner Occupied | 58,732 | 5,313 | 12,373 | — | 76,418 | ||||||||||||||||||||||||||||
Other | 7,059 | 76 | — | — | 7,135 | ||||||||||||||||||||||||||||
Residential real estate: | |||||||||||||||||||||||||||||||||
First mortgage | 19,465 | 1,731 | 3,506 | — | 24,702 | ||||||||||||||||||||||||||||
Multifamily | 5,702 | 63 | 63 | — | 5,828 | ||||||||||||||||||||||||||||
Home equity | 2,853 | — | 308 | — | 3,161 | ||||||||||||||||||||||||||||
Construction | 83 | — | — | — | 83 | ||||||||||||||||||||||||||||
Consumer | 1,323 | 2 | 21 | — | 1,346 | ||||||||||||||||||||||||||||
Other loans | 2,754 | — | — | — | 2,754 | ||||||||||||||||||||||||||||
Total | $ | 141,615 | $ | 11,302 | $ | 22,305 | $ | — | $ | 175,222 | |||||||||||||||||||||||
Schedule of Troubled Debt Restructurings | ' | ||||||||||||||||||||||||||||||||
The following tables present TDRs as of September 30, 2013 and December 31, 2012. | |||||||||||||||||||||||||||||||||
Troubled Debt Restructurings | |||||||||||||||||||||||||||||||||
30-Sep-13 | |||||||||||||||||||||||||||||||||
Non-accrual | Total | ||||||||||||||||||||||||||||||||
Accrual Status | Status | Modifications | |||||||||||||||||||||||||||||||
(Dollars in thousands) | Number | Amount | Number | Amount | Number | Amount | |||||||||||||||||||||||||||
Commercial real estate: | |||||||||||||||||||||||||||||||||
Construction | 2 | $ | 362 | — | $ | — | 2 | $ | 362 | ||||||||||||||||||||||||
Owner occupied | 5 | 3,105 | — | — | 5 | 3,105 | |||||||||||||||||||||||||||
Other | 5 | 4,886 | — | — | 5 | 4,886 | |||||||||||||||||||||||||||
Faith-based non-profit: | |||||||||||||||||||||||||||||||||
Owner occpied | 20 | 15,767 | 1 | 30 | 21 | 15,797 | |||||||||||||||||||||||||||
Residential real estate: | |||||||||||||||||||||||||||||||||
First mortgage | 1 | 31 | 3 | 251 | 4 | 282 | |||||||||||||||||||||||||||
33 | $ | 24,151 | 4 | $ | 281 | 37 | $ | 24,432 | |||||||||||||||||||||||||
Troubled Debt Restructurings | |||||||||||||||||||||||||||||||||
31-Dec-12 | |||||||||||||||||||||||||||||||||
Non-accrual | Total | ||||||||||||||||||||||||||||||||
Accrual Status | Status | Modifications | |||||||||||||||||||||||||||||||
(Dollars in thousands) | Number | Amount | Number | Amount | Number | Amount | |||||||||||||||||||||||||||
Commercial real estate: | |||||||||||||||||||||||||||||||||
Construction | 2 | $ | 371 | — | $ | — | 2 | $ | 371 | ||||||||||||||||||||||||
Owner occupied | 4 | 730 | — | — | 4 | 730 | |||||||||||||||||||||||||||
Other | 5 | 3,648 | — | — | 5 | 3,648 | |||||||||||||||||||||||||||
Faith-based non-profit: | |||||||||||||||||||||||||||||||||
Owner occpied | 17 | 9,666 | 4 | 5,241 | 21 | 14,907 | |||||||||||||||||||||||||||
Residential real estate: | |||||||||||||||||||||||||||||||||
First mortgage | 2 | 285 | 4 | 309 | 6 | 594 | |||||||||||||||||||||||||||
30 | $ | 14,700 | 8 | $ | 5,550 | 38 | $ | 20,250 | |||||||||||||||||||||||||
The following table shows loans restructured during the three and nine months ended September 30, 2013. | |||||||||||||||||||||||||||||||||
30-Sep-13 | |||||||||||||||||||||||||||||||||
Pre-modification Outstanding | Post-Modification Outstanding | ||||||||||||||||||||||||||||||||
(Dollars in thousands) | Number of loans | Recorded Investment | Recorded Investment | ||||||||||||||||||||||||||||||
Extended payment terms | |||||||||||||||||||||||||||||||||
Commercial real estate: | |||||||||||||||||||||||||||||||||
Owner occupied | 1 | $ | 40 | $ | 21 | ||||||||||||||||||||||||||||
Faith-based non-profit: | |||||||||||||||||||||||||||||||||
Owner Occupied | 1 | 1,284 | 1,276 | ||||||||||||||||||||||||||||||
2 | $ | 1,324 | $ | 1,297 | |||||||||||||||||||||||||||||
For the Nine Months Ended | |||||||||||||||||||||||||||||||||
30-Sep-13 | |||||||||||||||||||||||||||||||||
Pre-modification Outstanding | Post-Modification Outstanding | ||||||||||||||||||||||||||||||||
(Dollars in thousands) | Number of loans | Recorded Investment | Recorded Investment | ||||||||||||||||||||||||||||||
Extended payment terms | |||||||||||||||||||||||||||||||||
Commercial real estate: | |||||||||||||||||||||||||||||||||
Owner occupied | 1 | $ | 40 | $ | 21 | ||||||||||||||||||||||||||||
Faith-based non-profit: | |||||||||||||||||||||||||||||||||
Owner Occupied | 1 | 1,284 | 1,276 | ||||||||||||||||||||||||||||||
2 | $ | 1,324 | $ | 1,297 | |||||||||||||||||||||||||||||
The following table shows loans restructured during the three and nine months ended September 30, 2012. | |||||||||||||||||||||||||||||||||
For the Three Months Ended | |||||||||||||||||||||||||||||||||
30-Sep-12 | |||||||||||||||||||||||||||||||||
Pre-modification Outstanding | Post-Modification Outstanding | ||||||||||||||||||||||||||||||||
(Dollars in thousands) | Number of loans | Recorded Investment | Recorded Investment | ||||||||||||||||||||||||||||||
Below market interest rate | |||||||||||||||||||||||||||||||||
Owner Occupied | 1 | $ | 2,522 | $ | 2,522 | ||||||||||||||||||||||||||||
Other loans | — | — | — | ||||||||||||||||||||||||||||||
1 | $ | 2,522 | $ | 2,522 | |||||||||||||||||||||||||||||
For the Nine Months Ended | |||||||||||||||||||||||||||||||||
30-Sep-12 | |||||||||||||||||||||||||||||||||
Pre-modification Outstanding | Post-Modification Outstanding | ||||||||||||||||||||||||||||||||
(Dollars in thousands) | Number of loans | Recorded Investment | Recorded Investment | ||||||||||||||||||||||||||||||
Below market interest rate | |||||||||||||||||||||||||||||||||
Owner Occupied | 1 | 2,522 | 2,522 | ||||||||||||||||||||||||||||||
Extended payment terms | |||||||||||||||||||||||||||||||||
Owner occupied | 1 | 80 | 80 | ||||||||||||||||||||||||||||||
Other loans | 1 | 1,353 | 1,353 | ||||||||||||||||||||||||||||||
3 | $ | 3,955 | $ | 3,955 |
COMMITMENTS_AND_CONTINGENCIES_
COMMITMENTS AND CONTINGENCIES (Tables) | 9 Months Ended | ||||||||||||
Sep. 30, 2013 | |||||||||||||
Commitments And Contingencies Tables | ' | ||||||||||||
Loan Commitments and Letters of Credit- Off Balance Sheet | ' | ||||||||||||
Commitments outstanding at September 30, 2013 are summarized in the following table: | |||||||||||||
(Dollars in thousands) | Commercial | Other loan | Total | ||||||||||
letters of credit | commitments | commitments | |||||||||||
Less than one year | $ | 123 | $ | 5,240 | $ | 5,363 | |||||||
One to three years | 86 | 730 | 816 | ||||||||||
Three to five years | 321 | 1,775 | 2,096 | ||||||||||
More than five years | — | 20,411 | 20,411 | ||||||||||
Total | $ | 530 | $ | 28,156 | $ | 28,686 |
FAIR_VALUE_MEASUREMENT_Tables
FAIR VALUE MEASUREMENT (Tables) | 9 Months Ended | ||||||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||||||
Fair Value Measurement Tables | ' | ||||||||||||||||||||
Schedule of assets and liabilities measured at fair value on a recurring basis | ' | ||||||||||||||||||||
Assets measured at fair value on a recurring basis as of September 30, 2013 were: | |||||||||||||||||||||
(Dollars in thousands) | Quoted Prices in | Significant Other | Significant | ||||||||||||||||||
Active Markets for | Observable | Unobservable | |||||||||||||||||||
Identical Assets | Inputs | Inputs | |||||||||||||||||||
Description | 30-Sep-13 | (Level 1) | (Level 2) | (Level 3) | |||||||||||||||||
Recurring: | |||||||||||||||||||||
US government agencies | $ | 4,882 | $ | — | $ | 4,882 | $ | — | |||||||||||||
Government sponsored MBS | |||||||||||||||||||||
Residential | 51,579 | — | 51,579 | — | |||||||||||||||||
Municipal securities | |||||||||||||||||||||
North Carolina | 1,477 | — | 1,477 | — | |||||||||||||||||
Total | $ | 57,938 | $ | — | $ | 57,938 | $ | — | |||||||||||||
Assets measured at fair value on a recurring basis as of December 31, 2012 were: | |||||||||||||||||||||
(Dollars in thousands) | Quoted Prices in | Significant Other | Significant | ||||||||||||||||||
Active Markets for | Observable | Unobservable | |||||||||||||||||||
Identical Assets | Inputs | Inputs | |||||||||||||||||||
Description | 31-Dec-12 | (Level 1) | (Level 2) | (Level 3) | |||||||||||||||||
Recurring: | |||||||||||||||||||||
US government agencies | $ | 1,327 | $ | — | $ | 1,327 | $ | — | |||||||||||||
Government sponsored MBS | |||||||||||||||||||||
Residential | 57,931 | — | 57,931 | — | |||||||||||||||||
Municipal securities | |||||||||||||||||||||
North Carolina | 1,553 | — | 1,553 | — | |||||||||||||||||
Total | $ | 60,811 | $ | — | $ | 60,811 | $ | — | |||||||||||||
Schedule of assets and liabilities measured at fair value on a non recurring basis | ' | ||||||||||||||||||||
Assets measured at fair value on a nonrecurring basis as of September 30, 2013 and December 31, 2012 were: | |||||||||||||||||||||
(Dollars in thousands) | Quoted Prices in | Significant Other | Significant | ||||||||||||||||||
Active Markets for | Observable | Unobservable | |||||||||||||||||||
Identical Assets | Inputs | Inputs | |||||||||||||||||||
Description | 30-Sep-13 | (Level 1) | (Level 2) | (Level 3) | |||||||||||||||||
Nonrecurring: | |||||||||||||||||||||
OREO | $ | 2,942 | $ | — | $ | — | $ | 2,942 | |||||||||||||
Repossessed collateral | 590 | — | — | 590 | |||||||||||||||||
Impaired loans: | |||||||||||||||||||||
Commercial real estate | 8,496 | — | — | 8,496 | |||||||||||||||||
Faith-based non-profit | 17,020 | — | — | 17,020 | |||||||||||||||||
Residential real estate | 3,790 | — | — | 3,790 | |||||||||||||||||
Consumer | 13 | — | — | 13 | |||||||||||||||||
Mortgage Servicing Rights | 25 | — | — | 25 | |||||||||||||||||
Total | $ | 32,876 | $ | — | $ | — | $ | 32,876 | |||||||||||||
(Dollars in thousands) | Quoted Prices in | Significant Other | Significant | ||||||||||||||||||
Active Markets for | Observable | Unobservable | |||||||||||||||||||
Identical Assets | Inputs | Inputs | |||||||||||||||||||
Description | 31-Dec-12 | (Level 1) | (Level 2) | (Level 3) | |||||||||||||||||
Nonrecurring: | |||||||||||||||||||||
OREO | $ | 3,055 | $ | — | $ | — | $ | 3,055 | |||||||||||||
Repossessed collateral | 590 | — | — | 590 | |||||||||||||||||
Impaired loans: | |||||||||||||||||||||
Commercial real estate | 4,749 | — | — | 4,749 | |||||||||||||||||
Faith-based non-profit | 14,863 | — | — | 14,863 | |||||||||||||||||
Residential real estate | 3,916 | — | — | 3,916 | |||||||||||||||||
Consumer | 16 | — | — | 16 | |||||||||||||||||
Mortgage Servicing Rights | 36 | — | — | 36 | |||||||||||||||||
Total | $ | 27,225 | $ | — | $ | — | $ | 27,225 | |||||||||||||
Quantitative Information about Level 3 Fair Value Measurements | |||||||||||||||||||||
(Dollars in thousands) | Significant | Significant | |||||||||||||||||||
Valuation | Unobservable | Unobservable | |||||||||||||||||||
Description | 30-Sep-13 | Technique | Inputs | Input Value | |||||||||||||||||
Nonrecurring: | |||||||||||||||||||||
OREO | $ | 2,942 | discounted appraisals | collateral discounts | 6-20 | % | |||||||||||||||
Repossessed collateral | 590 | discounted appraisals | collateral discounts | 20-50 | % | ||||||||||||||||
Impaired loans | 29,319 | discounted appraisals | collateral discounts | 6-20 | % | ||||||||||||||||
Mortgage Servicing Rights | 25 | discounted cash flows | PSA speed | 426 | % | ||||||||||||||||
Total | $ | 32,876 | cost to service | 6 | % | ||||||||||||||||
discount rate | 10 | % | |||||||||||||||||||
(Dollars in thousands) | Significant | Significant | |||||||||||||||||||
Valuation | Unobservable | Unobservable | |||||||||||||||||||
Description | 31-Dec-12 | Technique | Inputs | Input Value | |||||||||||||||||
Nonrecurring: | |||||||||||||||||||||
OREO | $ | 3,055 | discounted appraisals | collateral discounts | 6-20 | % | |||||||||||||||
Repossessed collateral | 590 | discounted appraisals | collateral discounts | 20-50 | % | ||||||||||||||||
Impaired loans | 23,544 | discounted appraisals | collateral discounts | 6-20 | % | ||||||||||||||||
Mortgage Servicing Rights | 36 | discounted cash flows | PSA speed | 426 | % | ||||||||||||||||
Total | $ | 27,225 | cost to service | 6 | % | ||||||||||||||||
discount rate | 10 | % | |||||||||||||||||||
Schedule of carrying amount and fair value of financial instruments | ' | ||||||||||||||||||||
As of September 30, 2013 and December 31, 2012, the carrying amounts and associated estimated fair value of financial assets and liabilities of the Company are as follows: | |||||||||||||||||||||
30-Sep-13 | |||||||||||||||||||||
(Dollars in thousands) | Carrying | Estimated | |||||||||||||||||||
(Unaudited) | Amount | Fair Value | Level 1 | Level 2 | Level 3 | ||||||||||||||||
Assets: | |||||||||||||||||||||
Cash and cash equivalents | $ | 29,362 | $ | 29,362 | $ | 29,362 | $ | — | $ | — | |||||||||||
Marketable securities | 57,938 | 57,938 | — | 57,938 | — | ||||||||||||||||
Loans, net of allowances for loan losses | 183,919 | 181,266 | 181,266 | ||||||||||||||||||
Accrued interest receivable | 862 | 862 | 862 | — | |||||||||||||||||
Liabilities: | |||||||||||||||||||||
Non-maturity deposits | $ | 118,500 | $ | 118,500 | 118,500 | — | — | ||||||||||||||
Maturity deposits | 131,375 | 130,992 | — | 130,992 | — | ||||||||||||||||
Other borrowings | 867 | 805 | — | — | 805 | ||||||||||||||||
Accrued interest payable | 90 | 90 | 90 | — | — | ||||||||||||||||
31-Dec-12 | |||||||||||||||||||||
(Dollars in thousands) | Carrying | Estimated | |||||||||||||||||||
Amount | Value | Level 1 | Level 2 | Level 3 | |||||||||||||||||
Assets: | |||||||||||||||||||||
Cash and cash equivalents | $ | 42,586 | $ | 42,586 | $ | 42,586 | $ | — | $ | — | |||||||||||
Marketable securities | 60,811 | 60,811 | — | 60,811 | — | ||||||||||||||||
Loans, net of allowances for loan losses | 171,723 | 175,041 | — | — | 175,041 | ||||||||||||||||
Accrued interest receivable | 858 | 858 | 858 | — | — | ||||||||||||||||
Liabilities: | |||||||||||||||||||||
Non-maturity deposits | $ | 116,276 | $ | 116,276 | 116,276 | — | — | ||||||||||||||
Maturity deposits | 134,603 | 134,322 | — | 134,322 | # | — | |||||||||||||||
Other borrowings | 2,937 | 2,871 | — | — | 2,871 | ||||||||||||||||
Accrued interest payable | 119 | 119 | 119 | — | — |
INVESTMENT_SECURITIES_Details_
INVESTMENT SECURITIES (Details Narrative) (USD $) | 3 Months Ended | 9 Months Ended | |||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 |
N | N | N | |||
Investment securities available for sale, at fair value | $57,938 | ' | $57,938 | ' | $60,811 |
Aggregate gross realized gains | 75 | ' | 264 | ' | ' |
Aggregate gross realized losses | ' | 8 | ' | 8 | ' |
Number of investment positions | 53 | ' | 53 | ' | 11 |
Pledged to Federal Reserve Bank | ' | ' | ' | ' | ' |
Funds pledged for public deposits | 1,000 | ' | 1,000 | ' | 1,100 |
Pledged to Public Housing | ' | ' | ' | ' | ' |
Funds pledged for public deposits | 2,700 | ' | 2,700 | ' | 4,900 |
Pledged to NC State Treasurer | ' | ' | ' | ' | ' |
Funds pledged for public deposits | $16,300 | ' | $16,300 | ' | $2,600 |
INVESTMENT_SECURITIES_Details
INVESTMENT SECURITIES (Details) (USD $) | 9 Months Ended | 12 Months Ended |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Dec. 31, 2012 |
Available-for-sale Securities, Amortized Cost Basis | $58,221 | $60,152 |
Available-for-sale Securities, Gross Unrealized Gains | 226 | 688 |
Available-for-sale Securities, Gross Unrealized Losses | -509 | -29 |
Available-for-sale Securities, Debt Securities | 57,938 | 60,811 |
US government agencies | ' | ' |
Available-for-sale Securities, Amortized Cost Basis | 5,000 | 1,322 |
Available-for-sale Securities, Gross Unrealized Gains | 7 | 5 |
Available-for-sale Securities, Gross Unrealized Losses | -125 | ' |
Available-for-sale Securities, Debt Securities | 4,882 | 1,327 |
Government sponsored MBS - Residential | ' | ' |
Available-for-sale Securities, Amortized Cost Basis | 51,733 | 57,333 |
Available-for-sale Securities, Gross Unrealized Gains | 191 | 627 |
Available-for-sale Securities, Gross Unrealized Losses | -345 | -29 |
Available-for-sale Securities, Debt Securities | 51,579 | 57,931 |
Municipal securities - North Carolina | ' | ' |
Available-for-sale Securities, Amortized Cost Basis | 1,488 | 1,497 |
Available-for-sale Securities, Gross Unrealized Gains | 28 | 56 |
Available-for-sale Securities, Gross Unrealized Losses | -39 | ' |
Available-for-sale Securities, Debt Securities | $1,477 | $1,553 |
INVESTMENT_SECURITIES_Details_1
INVESTMENT SECURITIES (Details 1) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Fair Value | ' | ' |
Total debt securities | $57,938 | $60,811 |
US government agencies | ' | ' |
Fair Value | ' | ' |
Due within one year | ' | 1,005 |
Due after one year through five years | 3,004 | 322 |
Due after five years through ten years | 1,878 | ' |
Total debt securities | 4,882 | 1,327 |
Amortized Cost | ' | ' |
Due within one year | ' | 1,000 |
Due after one year through five years | 3,000 | 322 |
Due after five years through ten years | 2,000 | ' |
Total debt securities | 5,000 | 1,322 |
Government sponsored MBS - Residential | ' | ' |
Fair Value | ' | ' |
Due within one year | 15,830 | ' |
Due after one year through five years | 24,695 | 135 |
Due after five years through ten years | 7,484 | 171 |
Due after ten years | 3,606 | 57,625 |
Total debt securities | 51,579 | 57,931 |
Amortized Cost | ' | ' |
Due within one year | 15,882 | ' |
Due after one year through five years | 24,733 | 126 |
Due after five years through ten years | 7,513 | 161 |
Due after ten years | 3,605 | 57,046 |
Total debt securities | 51,733 | 57,333 |
Municipal securities - North Carolina | ' | ' |
Fair Value | ' | ' |
Due within one year | 476 | 488 |
Due after one year through five years | 441 | 458 |
Due after five years through ten years | 560 | 607 |
Total debt securities | 1,477 | 1,553 |
Amortized Cost | ' | ' |
Due within one year | 466 | 466 |
Due after one year through five years | 423 | 425 |
Due after five years through ten years | 599 | 606 |
Total debt securities | $1,488 | $1,497 |
INVESTMENT_SECURITIES_Details_2
INVESTMENT SECURITIES (Details 2) (USD $) | 9 Months Ended | 12 Months Ended |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Dec. 31, 2012 |
Securities in an Unrealized Loss Position for Less than 12 Months | ' | ' |
Fair Value | $37,789 | $8,027 |
Unrealized Losses | -509 | -29 |
Securities in an Unrealized Loss Position for More than 12 Months | ' | ' |
Fair Value | 21 | 21 |
Securities Total | ' | ' |
Total Fair Value | 37,810 | 8,048 |
Total Unrealized Losses | -509 | -29 |
US government agencies | ' | ' |
Securities in an Unrealized Loss Position for Less than 12 Months | ' | ' |
Fair Value | 2,875 | ' |
Unrealized Losses | -125 | ' |
Securities Total | ' | ' |
Total Fair Value | 2,875 | ' |
Total Unrealized Losses | -125 | ' |
Government sponsored MBS - Residential | ' | ' |
Securities in an Unrealized Loss Position for Less than 12 Months | ' | ' |
Fair Value | 34,354 | 8,027 |
Unrealized Losses | -345 | -29 |
Securities in an Unrealized Loss Position for More than 12 Months | ' | ' |
Fair Value | 21 | 21 |
Securities Total | ' | ' |
Total Fair Value | 34,375 | 8,048 |
Total Unrealized Losses | -345 | -29 |
Municipal securities - North Carolina | ' | ' |
Securities in an Unrealized Loss Position for Less than 12 Months | ' | ' |
Fair Value | 560 | ' |
Unrealized Losses | -39 | ' |
Securities Total | ' | ' |
Total Fair Value | 560 | ' |
Total Unrealized Losses | ($39) | ' |
FHLB_STOCK_Details_Narrative
FHLB STOCK (Details Narrative) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Fhlb Stock Details Narrative | ' | ' |
Required investment in FHLB stock as a percent of total assets | 0.15% | ' |
Base amount, as a component of the maximum amount of FHLB stock that may be purchased | $20,000 | $26,000 |
Percent of outstanding FHLB advances, as a component of the maximum amount of FHLB stock that may be purchased | 4.50% | ' |
Carrying value of FHLB stock | $389 | $488 |
ACCUMULATED_OTHER_COMPREHENSIV2
ACCUMULATED OTHER COMPREHENSIVE INCOME (Details) (USD $) | 3 Months Ended | 9 Months Ended |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2013 |
Unrealized Gains and Losses on Available-for-Sale Securities | ' | ' |
Balance, beginning | ($8) | $426 |
Other comprehensive loss before reclassifications | -169 | -603 |
Net current-period other comprehensive loss | -169 | -603 |
Balance, ending | -177 | -177 |
Defined Benefit Pension Items | ' | ' |
Balance, beginning | -1,834 | -1,834 |
Balance, ending | -1,834 | -1,834 |
Total | ' | ' |
Accumulated other comprehensive loss | -1,842 | -1,408 |
Other comprehensive loss before reclassifications | -169 | -603 |
Net current period other comprehensive loss | -169 | -603 |
Accumulated other comprehensive loss | ($2,011) | ($2,011) |
LOANS_AND_ALLOWANCE_FOR_LOAN_L2
LOANS AND ALLOWANCE FOR LOAN LOSSES (Details Narrative) (USD $) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 | Jun. 30, 2012 |
N | N | N | ||||
Loans And Allowance For Loan Losses Details Narrative | ' | ' | ' | ' | ' | ' |
Annualized Net Charge-offs, percentage | 0.02% | 0.66% | 0.20% | 0.38% | 0.27% | ' |
Net charge-offs | $7 | $303 | $272 | $518 | ' | ' |
Concentration risk - percentage of financing receivables in faith-based non-profit organizations | ' | ' | 45.91% | ' | ' | ' |
Concentration risk - percentage of reserve allocated to faith-based non-profit organizations | ' | ' | 34.23% | ' | ' | ' |
Recorded investment, homogeneous first mortage residential real estate | ' | ' | ' | ' | 1,900 | ' |
Total Impaired loans | ' | ' | ' | ' | 24,100 | ' |
Recorded investment, TDR total impaired loans | 24,500 | ' | 24,500 | ' | 20,200 | 25,500 |
Number of loans evaluated based on collateral dependency | 87 | ' | 87 | ' | 55 | ' |
Reserve for unfunded commitments | $39 | ' | $39 | ' | $54 | ' |
LOANS_AND_ALLOWANCE_FOR_LOAN_L3
LOANS AND ALLOWANCE FOR LOAN LOSSES (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Beginning balance | $3,234 | $3,498 | $3,499 | $3,850 |
Charge-offs | -45 | -311 | -327 | -622 |
Recoveries | 38 | 8 | 55 | 104 |
Provision (decrease) increase | 10 | 122 | 10 | 166 |
Ending balance | 3,237 | 3,498 | 3,237 | 3,498 |
Commercial | ' | ' | ' | ' |
Beginning balance | 241 | 61 | 90 | 348 |
Provision (decrease) increase | 203 | -36 | 354 | -323 |
Ending balance | 444 | 25 | 444 | 25 |
Commercial Real Estate | ' | ' | ' | ' |
Beginning balance | 806 | 1,187 | 881 | 971 |
Charge-offs | ' | ' | -237 | -56 |
Recoveries | 25 | ' | 27 | 1 |
Provision (decrease) increase | 52 | -18 | 212 | 253 |
Ending balance | 883 | 1,169 | 883 | 1,169 |
Faith Based Non-Profit | ' | ' | ' | ' |
Beginning balance | 1,278 | 1,091 | 1,246 | 1,128 |
Provision (decrease) increase | -170 | -60 | -138 | -97 |
Ending balance | 1,108 | 1,031 | 1,108 | 1,031 |
Residential Real Estate | ' | ' | ' | ' |
Beginning balance | 831 | 1,243 | 937 | 1,299 |
Charge-offs | -40 | -303 | -73 | -539 |
Recoveries | 4 | 4 | 12 | 93 |
Provision (decrease) increase | -57 | 230 | -138 | 321 |
Ending balance | 738 | 1,174 | 738 | 1,174 |
Consumer | ' | ' | ' | ' |
Beginning balance | 22 | 46 | 30 | 62 |
Charge-offs | -1 | ' | -3 | -1 |
Recoveries | 6 | 4 | 7 | 1 |
Provision (decrease) increase | -8 | 2 | -15 | -10 |
Ending balance | 19 | 52 | 19 | 52 |
Other | ' | ' | ' | ' |
Beginning balance | 43 | 51 | 54 | 42 |
Charge-offs | -4 | -8 | -14 | -26 |
Recoveries | 3 | ' | 9 | 9 |
Provision (decrease) increase | 3 | 4 | -4 | 22 |
Ending balance | 45 | 47 | 45 | 47 |
Unallocated | ' | ' | ' | ' |
Beginning balance | 13 | ' | 261 | ' |
Provision (decrease) increase | ($13) | ' | ($261) | ' |
LOANS_AND_ALLOWANCE_FOR_LOAN_L4
LOANS AND ALLOWANCE FOR LOAN LOSSES (Details 1) (USD $) | Sep. 30, 2013 | Jun. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Dec. 31, 2011 |
In Thousands, unless otherwise specified | ||||||
Ending balances: Allowance for loan losses | ' | ' | ' | ' | ' | ' |
Individually evaluated for impairment | $352 | ' | $480 | ' | ' | ' |
Collectively evaluated for impairment | 2,885 | ' | 3,019 | ' | ' | ' |
Allowances for loan losses | 3,237 | 3,234 | 3,499 | 3,498 | 3,498 | 3,850 |
Ending balances: Loans | ' | ' | ' | ' | ' | ' |
Individually evaluated for impairment | 29,591 | ' | 22,203 | ' | ' | ' |
Collectively evaluated for impairment | 157,565 | ' | 153,019 | ' | ' | ' |
Loans, net of unearned income and deferred fees | 187,156 | ' | 175,222 | ' | ' | ' |
Commercial | ' | ' | ' | ' | ' | ' |
Ending balances: Allowance for loan losses | ' | ' | ' | ' | ' | ' |
Collectively evaluated for impairment | 444 | ' | 90 | ' | ' | ' |
Allowances for loan losses | 444 | 241 | 90 | 25 | 61 | 348 |
Ending balances: Loans | ' | ' | ' | ' | ' | ' |
Individually evaluated for impairment | ' | ' | ' | ' | ' | ' |
Collectively evaluated for impairment | 12,658 | ' | 3,282 | ' | ' | ' |
Loans, net of unearned income and deferred fees | 12,658 | ' | 3,282 | ' | ' | ' |
Commercial Real Estate | ' | ' | ' | ' | ' | ' |
Ending balances: Allowance for loan losses | ' | ' | ' | ' | ' | ' |
Individually evaluated for impairment | ' | ' | 87 | ' | ' | ' |
Collectively evaluated for impairment | 883 | ' | 794 | ' | ' | ' |
Allowances for loan losses | 883 | 806 | 881 | 1,169 | 1,187 | 971 |
Ending balances: Loans | ' | ' | ' | ' | ' | ' |
Individually evaluated for impairment | 8,476 | ' | 4,837 | ' | ' | ' |
Collectively evaluated for impairment | 46,381 | ' | 43,332 | ' | ' | ' |
Loans, net of unearned income and deferred fees | 54,857 | ' | 48,169 | ' | ' | ' |
Faith Based Non-Profit | ' | ' | ' | ' | ' | ' |
Ending balances: Allowance for loan losses | ' | ' | ' | ' | ' | ' |
Individually evaluated for impairment | 87 | ' | 44 | ' | ' | ' |
Collectively evaluated for impairment | 1,021 | ' | 1,202 | ' | ' | ' |
Allowances for loan losses | 1,108 | 1,278 | 1,246 | 1,031 | 1,091 | 1,128 |
Ending balances: Loans | ' | ' | ' | ' | ' | ' |
Individually evaluated for impairment | 17,052 | ' | 14,907 | ' | ' | ' |
Collectively evaluated for impairment | 68,875 | ' | 70,990 | ' | ' | ' |
Loans, net of unearned income and deferred fees | 85,927 | ' | 85,897 | ' | ' | ' |
Residential Real Estate | ' | ' | ' | ' | ' | ' |
Ending balances: Allowance for loan losses | ' | ' | ' | ' | ' | ' |
Individually evaluated for impairment | 265 | ' | 349 | ' | ' | ' |
Collectively evaluated for impairment | 473 | ' | 588 | ' | ' | ' |
Allowances for loan losses | 738 | 831 | 937 | 1,174 | 1,243 | 1,299 |
Ending balances: Loans | ' | ' | ' | ' | ' | ' |
Individually evaluated for impairment | 4,051 | ' | 2,443 | ' | ' | ' |
Collectively evaluated for impairment | 26,024 | ' | 31,331 | ' | ' | ' |
Loans, net of unearned income and deferred fees | 30,075 | ' | 33,774 | ' | ' | ' |
Consumer | ' | ' | ' | ' | ' | ' |
Ending balances: Allowance for loan losses | ' | ' | ' | ' | ' | ' |
Collectively evaluated for impairment | 19 | ' | 30 | ' | ' | ' |
Allowances for loan losses | 19 | 22 | 30 | 52 | 46 | 62 |
Ending balances: Loans | ' | ' | ' | ' | ' | ' |
Individually evaluated for impairment | 12 | ' | 16 | ' | ' | ' |
Collectively evaluated for impairment | 1,200 | ' | 1,330 | ' | ' | ' |
Loans, net of unearned income and deferred fees | 1,212 | ' | 1,346 | ' | ' | ' |
Other | ' | ' | ' | ' | ' | ' |
Ending balances: Allowance for loan losses | ' | ' | ' | ' | ' | ' |
Collectively evaluated for impairment | 45 | ' | 54 | ' | ' | ' |
Allowances for loan losses | 45 | 43 | 54 | 47 | 51 | 42 |
Ending balances: Loans | ' | ' | ' | ' | ' | ' |
Collectively evaluated for impairment | 2,427 | ' | 2,754 | ' | ' | ' |
Loans, net of unearned income and deferred fees | 2,427 | ' | 2,754 | ' | ' | ' |
Unallocated | ' | ' | ' | ' | ' | ' |
Ending balances: Allowance for loan losses | ' | ' | ' | ' | ' | ' |
Collectively evaluated for impairment | ' | ' | 261 | ' | ' | ' |
Allowances for loan losses | ' | $13 | $261 | ' | ' | ' |
LOANS_AND_ALLOWANCE_FOR_LOAN_L5
LOANS AND ALLOWANCE FOR LOAN LOSSES (Details 2) (USD $) | Sep. 30, 2013 | Jun. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Dec. 31, 2011 |
In Thousands, unless otherwise specified | ||||||
Loans, net of unearned income and deferred fees | $187,156 | ' | $175,222 | ' | ' | ' |
Allowances for loan losses | -3,237 | -3,234 | -3,499 | -3,498 | -3,498 | -3,850 |
Loans, net | 183,919 | ' | 171,723 | ' | ' | ' |
Commercial | ' | ' | ' | ' | ' | ' |
Loans, net of unearned income and deferred fees | 12,658 | ' | 3,282 | ' | ' | ' |
Allowances for loan losses | -444 | -241 | -90 | -25 | -61 | -348 |
Commercial Real Estate Construction | ' | ' | ' | ' | ' | ' |
Loans, net of unearned income and deferred fees | 4,359 | ' | 3,621 | ' | ' | ' |
Commercial Real Estate Owner Occupied | ' | ' | ' | ' | ' | ' |
Loans, net of unearned income and deferred fees | 21,649 | ' | 18,377 | ' | ' | ' |
Commercial Real Estate Other | ' | ' | ' | ' | ' | ' |
Loans, net of unearned income and deferred fees | 28,849 | ' | 26,171 | ' | ' | ' |
Faith Based Non-Profit Construction | ' | ' | ' | ' | ' | ' |
Loans, net of unearned income and deferred fees | ' | ' | 2,344 | ' | ' | ' |
Faith Based Non-Profit Owner Occupied | ' | ' | ' | ' | ' | ' |
Loans, net of unearned income and deferred fees | 79,447 | ' | 76,418 | ' | ' | ' |
Faith Based Non-Profit Other | ' | ' | ' | ' | ' | ' |
Loans, net of unearned income and deferred fees | 6,480 | ' | 7,135 | ' | ' | ' |
Residential Real Estate First Mortgage | ' | ' | ' | ' | ' | ' |
Loans, net of unearned income and deferred fees | 23,159 | ' | 24,702 | ' | ' | ' |
Residential Real Estate Multifamily | ' | ' | ' | ' | ' | ' |
Loans, net of unearned income and deferred fees | 3,776 | ' | 5,828 | ' | ' | ' |
Residential Real Estate Home Equity | ' | ' | ' | ' | ' | ' |
Loans, net of unearned income and deferred fees | 3,140 | ' | 3,161 | ' | ' | ' |
Residential Real Estate Construction | ' | ' | ' | ' | ' | ' |
Loans, net of unearned income and deferred fees | ' | ' | 83 | ' | ' | ' |
Consumer | ' | ' | ' | ' | ' | ' |
Loans, net of unearned income and deferred fees | 1,212 | ' | 1,346 | ' | ' | ' |
Allowances for loan losses | -19 | -22 | -30 | -52 | -46 | -62 |
Other | ' | ' | ' | ' | ' | ' |
Loans, net of unearned income and deferred fees | 2,427 | ' | 2,754 | ' | ' | ' |
Allowances for loan losses | ($45) | ($43) | ($54) | ($47) | ($51) | ($42) |
LOANS_AND_ALLOWANCE_FOR_LOAN_L6
LOANS AND ALLOWANCE FOR LOAN LOSSES (Details 3) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Aging Schedule of Loans Receivable | ' | ' |
30-59 Days Past Due | $961 | $4,332 |
60-89 Days Past Due | 99 | 1,886 |
90 Days or More Past Due | 1,870 | 4,244 |
Total past due | 2,930 | 10,462 |
Current | 184,226 | 164,760 |
Loans, net of unearned income and deferred fees | 187,156 | 175,222 |
Commercial | ' | ' |
Aging Schedule of Loans Receivable | ' | ' |
30-59 Days Past Due | 4 | ' |
60-89 Days Past Due | 5 | 353 |
90 Days or More Past Due | 2 | ' |
Total past due | 11 | 353 |
Current | 12,647 | 2,929 |
Loans, net of unearned income and deferred fees | 12,658 | 3,282 |
Commercial Real Estate Construction | ' | ' |
Aging Schedule of Loans Receivable | ' | ' |
Current | 4,359 | 3,621 |
Loans, net of unearned income and deferred fees | 4,359 | 3,621 |
Commercial Real Estate Owner Occupied | ' | ' |
Aging Schedule of Loans Receivable | ' | ' |
90 Days or More Past Due | 129 | 263 |
Total past due | 129 | 263 |
Current | 21,520 | 18,114 |
Loans, net of unearned income and deferred fees | 21,649 | 18,377 |
Commercial Real Estate Other | ' | ' |
Aging Schedule of Loans Receivable | ' | ' |
30-59 Days Past Due | ' | 1,570 |
60-89 Days Past Due | ' | 856 |
90 Days or More Past Due | 572 | 400 |
Total past due | 572 | 2,826 |
Current | 28,277 | 23,345 |
Loans, net of unearned income and deferred fees | 28,849 | 26,171 |
Faith Based Non-Profit Construction | ' | ' |
Aging Schedule of Loans Receivable | ' | ' |
Current | ' | 2,344 |
Loans, net of unearned income and deferred fees | ' | 2,344 |
Faith Based Non-Profit Owner Occupied | ' | ' |
Aging Schedule of Loans Receivable | ' | ' |
30-59 Days Past Due | 613 | 1,845 |
90 Days or More Past Due | ' | 661 |
Total past due | 613 | 2,506 |
Current | 78,834 | 73,912 |
Loans, net of unearned income and deferred fees | 79,447 | 76,418 |
Faith Based Non-Profit Other | ' | ' |
Aging Schedule of Loans Receivable | ' | ' |
Current | 6,480 | 7,135 |
Loans, net of unearned income and deferred fees | 6,480 | 7,135 |
Residential Real Estate First Mortgage | ' | ' |
Aging Schedule of Loans Receivable | ' | ' |
30-59 Days Past Due | 75 | 787 |
60-89 Days Past Due | ' | 548 |
90 Days or More Past Due | 1,148 | 2,812 |
Total past due | 1,223 | 4,147 |
Current | 21,936 | 20,555 |
Loans, net of unearned income and deferred fees | 23,159 | 24,702 |
Residential Real Estate Multifamily | ' | ' |
Aging Schedule of Loans Receivable | ' | ' |
Current | 3,776 | 5,828 |
Loans, net of unearned income and deferred fees | 3,776 | 5,828 |
Residential Real Estate Home Equity | ' | ' |
Aging Schedule of Loans Receivable | ' | ' |
30-59 Days Past Due | 256 | 122 |
60-89 Days Past Due | 94 | 120 |
90 Days or More Past Due | 19 | 108 |
Total past due | 369 | 350 |
Current | 2,771 | 2,811 |
Loans, net of unearned income and deferred fees | 3,140 | 3,161 |
Residential Real Estate Construction | ' | ' |
Aging Schedule of Loans Receivable | ' | ' |
Current | ' | 83 |
Loans, net of unearned income and deferred fees | ' | 83 |
Consumer | ' | ' |
Aging Schedule of Loans Receivable | ' | ' |
30-59 Days Past Due | 13 | 8 |
60-89 Days Past Due | ' | 9 |
Total past due | 13 | 17 |
Current | 1,199 | 1,329 |
Loans, net of unearned income and deferred fees | 1,212 | 1,346 |
Other | ' | ' |
Aging Schedule of Loans Receivable | ' | ' |
Current | 2,427 | 2,754 |
Loans, net of unearned income and deferred fees | $2,427 | $2,754 |
LOANS_AND_ALLOWANCE_FOR_LOAN_L7
LOANS AND ALLOWANCE FOR LOAN LOSSES (Details 4) (USD $) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 | Jun. 30, 2012 |
Loans with no related allowance recorded: | ' | ' | ' | ' | ' | ' |
Imapired loans with no related allowance - Unpaid Principal Balance | $28,036 | ' | $28,036 | ' | $20,608 | $21,476 |
Impaired loans with no related allowance - Recorded Investment | 27,845 | ' | 27,845 | ' | 19,994 | 21,494 |
Imapired loans with no related allowance - Interest earned | 643 | 144 | 1,093 | 544 | 787 | ' |
Impaired loans with related allowance - Average Recorded Investment | 19,037 | 21,439 | 17,834 | 20,237 | 22,361 | ' |
Loans with an allowance recorded: | ' | ' | ' | ' | ' | ' |
Impaired loans with allowance - Unpaid Principal Balance | 1,822 | ' | 1,822 | ' | 2,209 | 3,972 |
Impaired loans with allowance - Recorded Investment | 1,826 | ' | 1,826 | ' | 2,209 | 3,972 |
Impaired loans with related allowance - Related Allowance | 352 | ' | 352 | ' | 480 | 707 |
Impaired loans with related allowance - Interest earned | 62 | 26 | 91 | 169 | 90 | ' |
Impaired loans with related allowance - Average Recorded Investment | 1,507 | 2,974 | 1,657 | 3,127 | 1,531 | ' |
Total impaired loans | ' | ' | ' | ' | ' | ' |
Impaired loans with allowance - Unpaid Principal Balance | 29,858 | 25,448 | 29,858 | 25,448 | 22,817 | ' |
Impaired loans with allowance - Recorded Investment | 29,671 | 25,466 | 29,671 | 25,466 | 22,203 | ' |
Impaired loans with related allowance - Interest earned | 705 | 170 | 1,184 | 713 | 877 | ' |
Impaired loans with related allowance - Average Recorded Investment | 20,544 | 24,413 | 19,491 | 23,364 | 23,892 | ' |
Commercial | ' | ' | ' | ' | ' | ' |
Loans with no related allowance recorded: | ' | ' | ' | ' | ' | ' |
Imapired loans with no related allowance - Unpaid Principal Balance | ' | 1,567 | ' | 1,567 | ' | ' |
Impaired loans with no related allowance - Recorded Investment | ' | 590 | ' | 590 | ' | ' |
Impaired loans with related allowance - Average Recorded Investment | ' | 590 | 98 | 590 | 295 | ' |
Commercial Real Estate Construction | ' | ' | ' | ' | ' | ' |
Loans with no related allowance recorded: | ' | ' | ' | ' | ' | ' |
Imapired loans with no related allowance - Unpaid Principal Balance | 362 | 374 | 362 | 374 | 371 | ' |
Impaired loans with no related allowance - Recorded Investment | 364 | 374 | 364 | 374 | 371 | ' |
Imapired loans with no related allowance - Interest earned | 10 | 7 | 21 | 24 | 31 | ' |
Impaired loans with related allowance - Average Recorded Investment | 274 | 374 | 276 | 499 | 300 | ' |
Loans with an allowance recorded: | ' | ' | ' | ' | ' | ' |
Impaired loans with related allowance - Average Recorded Investment | ' | 189 | ' | 283 | ' | ' |
Commercial Real Estate Owner Occupied | ' | ' | ' | ' | ' | ' |
Loans with no related allowance recorded: | ' | ' | ' | ' | ' | ' |
Imapired loans with no related allowance - Unpaid Principal Balance | 3,418 | 551 | 3,418 | 551 | 530 | ' |
Impaired loans with no related allowance - Recorded Investment | 3,184 | 551 | 3,184 | 551 | 530 | ' |
Imapired loans with no related allowance - Interest earned | 67 | 6 | 84 | 28 | 38 | ' |
Impaired loans with related allowance - Average Recorded Investment | 1,067 | 638 | 706 | 805 | 635 | ' |
Loans with an allowance recorded: | ' | ' | ' | ' | ' | ' |
Impaired loans with allowance - Unpaid Principal Balance | ' | 239 | ' | 239 | 238 | ' |
Impaired loans with allowance - Recorded Investment | ' | 239 | ' | 239 | 238 | ' |
Impaired loans with related allowance - Related Allowance | ' | 102 | ' | 102 | 87 | ' |
Impaired loans with related allowance - Interest earned | ' | 3 | ' | 12 | 15 | ' |
Impaired loans with related allowance - Average Recorded Investment | 59 | 241 | 59 | 468 | 60 | ' |
Commercial Real Estate Other | ' | ' | ' | ' | ' | ' |
Loans with no related allowance recorded: | ' | ' | ' | ' | ' | ' |
Imapired loans with no related allowance - Unpaid Principal Balance | 4,931 | 4,962 | 4,931 | 4,962 | 4,312 | ' |
Impaired loans with no related allowance - Recorded Investment | 4,948 | 5,964 | 4,948 | 5,964 | 3,698 | ' |
Imapired loans with no related allowance - Interest earned | 56 | 58 | 170 | 143 | 129 | ' |
Impaired loans with related allowance - Average Recorded Investment | 4,025 | 5,832 | 4,265 | 5,162 | 4,473 | ' |
Loans with an allowance recorded: | ' | ' | ' | ' | ' | ' |
Impaired loans with allowance - Unpaid Principal Balance | ' | 2,005 | ' | 2,005 | ' | ' |
Impaired loans with allowance - Recorded Investment | ' | 2,005 | ' | 2,005 | ' | ' |
Impaired loans with related allowance - Related Allowance | ' | 211 | ' | 211 | ' | ' |
Impaired loans with related allowance - Interest earned | ' | 6 | ' | 91 | ' | ' |
Impaired loans with related allowance - Average Recorded Investment | ' | 1,211 | 334 | 625 | 500 | ' |
Faith Based Non-Profit Construction | ' | ' | ' | ' | ' | ' |
Loans with an allowance recorded: | ' | ' | ' | ' | ' | ' |
Impaired loans with related allowance - Average Recorded Investment | ' | ' | ' | ' | 214 | ' |
Faith Based Non-Profit Owner Occupied | ' | ' | ' | ' | ' | ' |
Loans with no related allowance recorded: | ' | ' | ' | ' | ' | ' |
Imapired loans with no related allowance - Unpaid Principal Balance | 16,593 | 13,133 | 16,593 | 13,133 | 14,479 | ' |
Impaired loans with no related allowance - Recorded Investment | 16,648 | 13,126 | 16,648 | 13,126 | 14,479 | ' |
Imapired loans with no related allowance - Interest earned | 365 | 69 | 663 | 331 | 567 | ' |
Impaired loans with related allowance - Average Recorded Investment | 11,511 | 13,171 | 10,764 | 12,384 | 12,261 | ' |
Loans with an allowance recorded: | ' | ' | ' | ' | ' | ' |
Impaired loans with allowance - Unpaid Principal Balance | 458 | 430 | 458 | 430 | 428 | ' |
Impaired loans with allowance - Recorded Investment | 459 | 430 | 459 | 430 | 428 | ' |
Impaired loans with related allowance - Related Allowance | 87 | 52 | 87 | 52 | 44 | ' |
Impaired loans with related allowance - Interest earned | ' | 5 | 29 | 22 | 30 | ' |
Impaired loans with related allowance - Average Recorded Investment | 442 | 667 | 364 | 788 | ' | ' |
Faith Based Non-Profit Other | ' | ' | ' | ' | ' | ' |
Loans with no related allowance recorded: | ' | ' | ' | ' | ' | ' |
Impaired loans with related allowance - Average Recorded Investment | ' | ' | ' | ' | 1,611 | ' |
Residential Real Estate First Mortgage | ' | ' | ' | ' | ' | ' |
Loans with no related allowance recorded: | ' | ' | ' | ' | ' | ' |
Imapired loans with no related allowance - Unpaid Principal Balance | 2,712 | 889 | 2,712 | 889 | 814 | ' |
Impaired loans with no related allowance - Recorded Investment | 2,680 | 889 | 2,680 | 889 | 814 | ' |
Imapired loans with no related allowance - Interest earned | 145 | 4 | 155 | 18 | 19 | ' |
Impaired loans with related allowance - Average Recorded Investment | 2,120 | 834 | 1,668 | 797 | 2,671 | ' |
Loans with an allowance recorded: | ' | ' | ' | ' | ' | ' |
Impaired loans with allowance - Unpaid Principal Balance | 1,273 | 1,298 | 1,273 | 1,298 | 1,543 | ' |
Impaired loans with allowance - Recorded Investment | 1,276 | 1,298 | 1,276 | 1,298 | 1,543 | ' |
Impaired loans with related allowance - Related Allowance | 239 | 342 | 239 | 342 | 349 | ' |
Impaired loans with related allowance - Interest earned | 58 | 12 | 58 | 44 | 45 | ' |
Impaired loans with related allowance - Average Recorded Investment | 960 | 666 | 877 | 731 | 757 | ' |
Residential Real Estate Home Equity | ' | ' | ' | ' | ' | ' |
Loans with no related allowance recorded: | ' | ' | ' | ' | ' | ' |
Imapired loans with no related allowance - Unpaid Principal Balance | 8 | ' | 8 | ' | 86 | ' |
Impaired loans with no related allowance - Recorded Investment | 8 | ' | 8 | ' | 86 | ' |
Imapired loans with no related allowance - Interest earned | ' | ' | ' | ' | 3 | ' |
Impaired loans with related allowance - Average Recorded Investment | 30 | ' | 50 | ' | 111 | ' |
Loans with an allowance recorded: | ' | ' | ' | ' | ' | ' |
Impaired loans with allowance - Unpaid Principal Balance | 91 | ' | 91 | ' | ' | ' |
Impaired loans with allowance - Recorded Investment | 91 | ' | 91 | ' | ' | ' |
Impaired loans with related allowance - Related Allowance | 26 | ' | 26 | ' | ' | ' |
Impaired loans with related allowance - Interest earned | 4 | ' | 4 | ' | ' | ' |
Impaired loans with related allowance - Average Recorded Investment | 46 | ' | 23 | 231 | ' | ' |
Consumer | ' | ' | ' | ' | ' | ' |
Loans with no related allowance recorded: | ' | ' | ' | ' | ' | ' |
Imapired loans with no related allowance - Unpaid Principal Balance | 12 | ' | 12 | ' | 16 | ' |
Impaired loans with no related allowance - Recorded Investment | 13 | ' | 13 | ' | 16 | ' |
Imapired loans with no related allowance - Interest earned | ' | ' | ' | ' | ' | ' |
Impaired loans with related allowance - Average Recorded Investment | 10 | ' | 7 | ' | 4 | ' |
Loans with an allowance recorded: | ' | ' | ' | ' | ' | ' |
Impaired loans with related allowance - Average Recorded Investment | ' | ' | ' | $1 | ' | ' |
LOANS_AND_ALLOWANCE_FOR_LOAN_L8
LOANS AND ALLOWANCE FOR LOAN LOSSES (Details 5) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | N | N |
Non-accrual Loans | $4,528 | $8,732 |
Number of non-accrual loans | 50 | 53 |
Loans past due over 90 days still accruing | 1,411 | 1,694 |
Number of loans past due over 90 days still accruing | 21 | 15 |
Commercial | ' | ' |
Non-accrual Loans | 2 | ' |
Number of non-accrual loans | 1 | ' |
Commercial Real Estate Owner Occupied | ' | ' |
Non-accrual Loans | 78 | 39 |
Number of non-accrual loans | 2 | 1 |
Loans past due over 90 days still accruing | 52 | 224 |
Number of loans past due over 90 days still accruing | 1 | 4 |
Commercial Real Estate Other | ' | ' |
Non-accrual Loans | 45 | 49 |
Number of non-accrual loans | 1 | 1 |
Loans past due over 90 days still accruing | 526 | 351 |
Number of loans past due over 90 days still accruing | 3 | 1 |
Faith Based Non-Profit Owner Occupied | ' | ' |
Non-accrual Loans | 1,285 | 5,241 |
Number of non-accrual loans | 2 | 4 |
Loans past due over 90 days still accruing | ' | 661 |
Number of loans past due over 90 days still accruing | ' | 3 |
Residential Real Estate First Mortgage | ' | ' |
Non-accrual Loans | 3,092 | 3,384 |
Number of non-accrual loans | 39 | 44 |
Loans past due over 90 days still accruing | 814 | 357 |
Number of loans past due over 90 days still accruing | 16 | 6 |
Residential Real Estate Home Equity | ' | ' |
Non-accrual Loans | 14 | 3 |
Number of non-accrual loans | 3 | 1 |
Loans past due over 90 days still accruing | 19 | 101 |
Number of loans past due over 90 days still accruing | 1 | 1 |
Consumer | ' | ' |
Non-accrual Loans | $12 | $16 |
Number of non-accrual loans | 2 | 2 |
LOANS_AND_ALLOWANCE_FOR_LOAN_L9
LOANS AND ALLOWANCE FOR LOAN LOSSES (Details 6) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Loans, net of unearned income and deferred fees | $187,156 | $175,222 |
Pass | ' | ' |
Loans, net of unearned income and deferred fees | 155,641 | 141,615 |
Special Mention | ' | ' |
Loans, net of unearned income and deferred fees | 13,399 | 11,302 |
Substandard | ' | ' |
Loans, net of unearned income and deferred fees | 18,116 | 22,305 |
Commercial | ' | ' |
Loans, net of unearned income and deferred fees | 12,658 | 3,282 |
Commercial | Pass | ' | ' |
Loans, net of unearned income and deferred fees | 9,802 | 3,274 |
Commercial | Special Mention | ' | ' |
Loans, net of unearned income and deferred fees | 2,850 | ' |
Commercial | Substandard | ' | ' |
Loans, net of unearned income and deferred fees | 6 | 8 |
Commercial Real Estate Construction | ' | ' |
Loans, net of unearned income and deferred fees | 4,359 | 3,621 |
Commercial Real Estate Construction | Pass | ' | ' |
Loans, net of unearned income and deferred fees | 3,812 | 3,065 |
Commercial Real Estate Construction | Substandard | ' | ' |
Loans, net of unearned income and deferred fees | 547 | 556 |
Commercial Real Estate Owner Occupied | ' | ' |
Loans, net of unearned income and deferred fees | 21,649 | 18,377 |
Commercial Real Estate Owner Occupied | Pass | ' | ' |
Loans, net of unearned income and deferred fees | 17,023 | 13,379 |
Commercial Real Estate Owner Occupied | Special Mention | ' | ' |
Loans, net of unearned income and deferred fees | 608 | 3,151 |
Commercial Real Estate Owner Occupied | Substandard | ' | ' |
Loans, net of unearned income and deferred fees | 4,018 | 1,847 |
Commercial Real Estate Other | ' | ' |
Loans, net of unearned income and deferred fees | 28,849 | 26,171 |
Commercial Real Estate Other | Pass | ' | ' |
Loans, net of unearned income and deferred fees | 24,326 | 21,582 |
Commercial Real Estate Other | Special Mention | ' | ' |
Loans, net of unearned income and deferred fees | 961 | 966 |
Commercial Real Estate Other | Substandard | ' | ' |
Loans, net of unearned income and deferred fees | 3,562 | 3,623 |
Faith Based Non-Profit Construction | ' | ' |
Loans, net of unearned income and deferred fees | ' | 2,344 |
Faith Based Non-Profit Construction | Pass | ' | ' |
Loans, net of unearned income and deferred fees | ' | 2,344 |
Faith Based Non-Profit Owner Occupied | ' | ' |
Loans, net of unearned income and deferred fees | 79,447 | 76,418 |
Faith Based Non-Profit Owner Occupied | Pass | ' | ' |
Loans, net of unearned income and deferred fees | 65,252 | 58,732 |
Faith Based Non-Profit Owner Occupied | Special Mention | ' | ' |
Loans, net of unearned income and deferred fees | 8,255 | 5,313 |
Faith Based Non-Profit Owner Occupied | Substandard | ' | ' |
Loans, net of unearned income and deferred fees | 5,940 | 12,373 |
Faith Based Non-Profit Owner Occupied | Doubtful | ' | ' |
Loans, net of unearned income and deferred fees | ' | ' |
Faith Based Non-Profit Other | ' | ' |
Loans, net of unearned income and deferred fees | 6,480 | 7,135 |
Faith Based Non-Profit Other | Pass | ' | ' |
Loans, net of unearned income and deferred fees | 6,478 | 7,059 |
Faith Based Non-Profit Other | Special Mention | ' | ' |
Loans, net of unearned income and deferred fees | 2 | 76 |
Residential Real Estate First Mortgage | ' | ' |
Loans, net of unearned income and deferred fees | 23,159 | 24,702 |
Residential Real Estate First Mortgage | Pass | ' | ' |
Loans, net of unearned income and deferred fees | 18,832 | 19,465 |
Residential Real Estate First Mortgage | Special Mention | ' | ' |
Loans, net of unearned income and deferred fees | 684 | 1,731 |
Residential Real Estate First Mortgage | Substandard | ' | ' |
Loans, net of unearned income and deferred fees | 3,643 | 3,506 |
Residential Real Estate Multifamily | ' | ' |
Loans, net of unearned income and deferred fees | 3,776 | 5,828 |
Residential Real Estate Multifamily | Pass | ' | ' |
Loans, net of unearned income and deferred fees | 3,675 | 5,702 |
Residential Real Estate Multifamily | Special Mention | ' | ' |
Loans, net of unearned income and deferred fees | 39 | 63 |
Residential Real Estate Multifamily | Substandard | ' | ' |
Loans, net of unearned income and deferred fees | 62 | 63 |
Residential Real Estate Home Equity | ' | ' |
Loans, net of unearned income and deferred fees | 3,140 | 3,161 |
Residential Real Estate Home Equity | Pass | ' | ' |
Loans, net of unearned income and deferred fees | 2,820 | 2,853 |
Residential Real Estate Home Equity | Substandard | ' | ' |
Loans, net of unearned income and deferred fees | 320 | 308 |
Residential Real Estate Construction | ' | ' |
Loans, net of unearned income and deferred fees | ' | 83 |
Residential Real Estate Construction | Pass | ' | ' |
Loans, net of unearned income and deferred fees | ' | 83 |
Consumer | ' | ' |
Loans, net of unearned income and deferred fees | 1,212 | 1,346 |
Consumer | Pass | ' | ' |
Loans, net of unearned income and deferred fees | 1,194 | 1,323 |
Consumer | Special Mention | ' | ' |
Loans, net of unearned income and deferred fees | ' | 2 |
Consumer | Substandard | ' | ' |
Loans, net of unearned income and deferred fees | 18 | 21 |
Other | ' | ' |
Loans, net of unearned income and deferred fees | 2,427 | 2,754 |
Other | Pass | ' | ' |
Loans, net of unearned income and deferred fees | $2,427 | $2,754 |
Recovered_Sheet1
LOANS AND ALLOWANCE FOR LOAN LOSSES (Details 7) (USD $) | 3 Months Ended | 9 Months Ended | |||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 |
N | N | N | N | N | |
Accrual status | ' | ' | ' | ' | ' |
Number of loans, TDRs | 33 | ' | 33 | ' | 30 |
TDRs arising during period Recorded Investment | $24,151 | ' | $24,151 | ' | $14,700 |
Non-accrual Status | ' | ' | ' | ' | ' |
Number of loans, TDRs | 4 | ' | 4 | ' | 8 |
TDRs arising during period Recorded Investment | 281 | ' | 281 | ' | 5,550 |
Total | ' | ' | ' | ' | ' |
Number of loans, TDRs | 37 | ' | 37 | ' | 38 |
TDRs arising during period Post-Modification Recorded Investment | 24,432 | ' | 24,432 | ' | 20,250 |
Number of loans, TDRs | 2 | 1 | 2 | 3 | ' |
TDRs arising during period Pre-Modification Recorded Investment | 1,324 | 2,522 | 1,324 | 3,955 | ' |
TDRs arising during period Post-Modification Recorded Investment | 1,297 | 2,522 | 1,297 | 3,955 | ' |
Commercial Real Estate Construction | ' | ' | ' | ' | ' |
Accrual status | ' | ' | ' | ' | ' |
Number of loans, TDRs | 2 | ' | 2 | ' | 2 |
TDRs arising during period Recorded Investment | 362 | ' | 362 | ' | 371 |
Total | ' | ' | ' | ' | ' |
Number of loans, TDRs | 2 | ' | 2 | ' | 2 |
TDRs arising during period Post-Modification Recorded Investment | 362 | ' | 362 | ' | 371 |
Commercial Real Estate Owner Occupied | ' | ' | ' | ' | ' |
Accrual status | ' | ' | ' | ' | ' |
Number of loans, TDRs | 5 | ' | 5 | ' | 4 |
TDRs arising during period Recorded Investment | 3,105 | ' | 3,105 | ' | 730 |
Total | ' | ' | ' | ' | ' |
Number of loans, TDRs | 5 | ' | 5 | ' | 4 |
TDRs arising during period Post-Modification Recorded Investment | 3,105 | ' | 3,105 | ' | 730 |
Number of loans, TDRs | ' | ' | 1 | ' | ' |
TDRs arising during period Pre-Modification Recorded Investment | ' | ' | 40 | ' | ' |
TDRs arising during period Post-Modification Recorded Investment | ' | ' | 21 | ' | ' |
Commercial Real Estate Other | ' | ' | ' | ' | ' |
Accrual status | ' | ' | ' | ' | ' |
Number of loans, TDRs | 5 | ' | 5 | ' | 5 |
TDRs arising during period Recorded Investment | 4,886 | ' | 4,886 | ' | 3,648 |
Total | ' | ' | ' | ' | ' |
Number of loans, TDRs | 5 | ' | 5 | ' | 5 |
TDRs arising during period Post-Modification Recorded Investment | 4,886 | ' | 4,886 | ' | 3,648 |
Faith Based Non-Profit Owner Occupied | ' | ' | ' | ' | ' |
Accrual status | ' | ' | ' | ' | ' |
Number of loans, TDRs | 20 | ' | 20 | ' | 17 |
TDRs arising during period Recorded Investment | 15,767 | ' | 15,767 | ' | 9,666 |
Non-accrual Status | ' | ' | ' | ' | ' |
Number of loans, TDRs | 1 | ' | 1 | ' | 4 |
TDRs arising during period Recorded Investment | 30 | ' | 30 | ' | 5,241 |
Total | ' | ' | ' | ' | ' |
Number of loans, TDRs | 21 | ' | 21 | ' | 21 |
TDRs arising during period Post-Modification Recorded Investment | 15,797 | ' | 15,797 | ' | 14,907 |
Number of loans, TDRs | 1 | ' | 1 | 1 | ' |
TDRs arising during period Pre-Modification Recorded Investment | 1,284 | ' | 1,284 | 80 | ' |
TDRs arising during period Post-Modification Recorded Investment | 1,276 | ' | 1,276 | 80 | ' |
Residential Real Estate First Mortgage | ' | ' | ' | ' | ' |
Accrual status | ' | ' | ' | ' | ' |
Number of loans, TDRs | 1 | ' | 1 | ' | 2 |
TDRs arising during period Recorded Investment | 31 | ' | 31 | ' | 285 |
Non-accrual Status | ' | ' | ' | ' | ' |
Number of loans, TDRs | 3 | ' | 3 | ' | 4 |
TDRs arising during period Recorded Investment | 251 | ' | 251 | ' | 309 |
Total | ' | ' | ' | ' | ' |
Number of loans, TDRs | 4 | ' | 4 | ' | 6 |
TDRs arising during period Post-Modification Recorded Investment | 282 | ' | 282 | ' | 594 |
Commercial Real Estate | ' | ' | ' | ' | ' |
Total | ' | ' | ' | ' | ' |
Number of loans, TDRs | ' | 1 | 1 | 1 | ' |
TDRs arising during period Pre-Modification Recorded Investment | ' | 2,522 | 40 | 2,522 | ' |
TDRs arising during period Post-Modification Recorded Investment | ' | 2,522 | 21 | 2,522 | ' |
Other | ' | ' | ' | ' | ' |
Total | ' | ' | ' | ' | ' |
Number of loans, TDRs | ' | ' | ' | 1 | ' |
TDRs arising during period Pre-Modification Recorded Investment | ' | ' | ' | 1,353 | ' |
TDRs arising during period Post-Modification Recorded Investment | ' | ' | ' | $1,353 | ' |
OTHER_REAL_ESTATE_OWNED_Detail
OTHER REAL ESTATE OWNED (Details Narrative) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Real Estate [Abstract] | ' | ' |
OREO | $2,942 | $3,055 |
BORROWINGS_Details_Narrative
BORROWINGS (Details Narrative) (USD $) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2013 | Dec. 31, 2012 | |
Borrowings Details Narrative | ' | ' |
FHLB advances, maturing fully in 2020 | $70,000 | $70,000 |
Federal Home Loan Bank interest rate | 0.50% | 0.50% |
Capital lease | 20,000 | 20,000 |
Capital lease, interest rate | 1.60% | 1.60% |
Loan participations sold | ' | 200,000 |
Effective interest rate of loan participations sold | ' | 4.45% |
Federal funds lines of credit | 1,000,000 | 1,000,000 |
Federal funds unused lines of credit | $630,000 | $750,000 |
COMMITMENTS_AND_CONTINGENCIES_1
COMMITMENTS AND CONTINGENCIES (Details) (USD $) | Sep. 30, 2013 |
In Thousands, unless otherwise specified | |
Commerical Letters of Credit | ' |
Guarantee Obligations Less than 1 year | $123 |
Guarantee Obligations 1 to 3 years | 86 |
Guarantee Obligations 3 to 5 years | 321 |
Obligations to extend credit | 530 |
Other Commercial Loan Commitments | ' |
Guarantee Obligations Less than 1 year | 5,240 |
Guarantee Obligations 1 to 3 years | 730 |
Guarantee Obligations 3 to 5 years | 1,775 |
Guarantee Obligations greater than 5 years | 20,411 |
Obligations to extend credit | 28,156 |
Total Commitments | ' |
Guarantee Obligations Less than 1 year | 5,363 |
Guarantee Obligations 1 to 3 years | 816 |
Guarantee Obligations 3 to 5 years | 2,096 |
Guarantee Obligations greater than 5 years | 20,411 |
Obligations to extend credit | $28,686 |
FAIR_VALUE_MEASUREMENT_Details
FAIR VALUE MEASUREMENT (Details) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Recurring Fair Value Measurements | ' | ' |
Investment securities available for sale, at fair value | $57,938 | $60,811 |
Fair Value Measured on a Recurring Basis | ' | ' |
Recurring Fair Value Measurements | ' | ' |
Investment securities available for sale, at fair value | 57,938 | 60,811 |
Fair Value Measured on a Recurring Basis | Significant Other Observable Inputs (Level 2) | ' | ' |
Recurring Fair Value Measurements | ' | ' |
Investment securities available for sale, at fair value | 57,938 | 60,811 |
US Government Agencies | Fair Value Measured on a Recurring Basis | ' | ' |
Recurring Fair Value Measurements | ' | ' |
Investment securities available for sale, at fair value | 4,882 | 1,327 |
US Government Agencies | Fair Value Measured on a Recurring Basis | Significant Other Observable Inputs (Level 2) | ' | ' |
Recurring Fair Value Measurements | ' | ' |
Investment securities available for sale, at fair value | 4,882 | 1,327 |
Government Mortgage-backed Securities | Fair Value Measured on a Recurring Basis | ' | ' |
Recurring Fair Value Measurements | ' | ' |
Investment securities available for sale, at fair value | 51,579 | 57,931 |
Government Mortgage-backed Securities | Fair Value Measured on a Recurring Basis | Significant Other Observable Inputs (Level 2) | ' | ' |
Recurring Fair Value Measurements | ' | ' |
Investment securities available for sale, at fair value | 51,579 | 57,931 |
Non-Government Mortgage-backed Securities | ' | ' |
Recurring Fair Value Measurements | ' | ' |
Investment securities available for sale, at fair value | 1,477 | ' |
Non-Government Mortgage-backed Securities | Fair Value Measured on a Recurring Basis | ' | ' |
Recurring Fair Value Measurements | ' | ' |
Investment securities available for sale, at fair value | ' | 1,553 |
Non-Government Mortgage-backed Securities | Fair Value Measured on a Recurring Basis | Significant Other Observable Inputs (Level 2) | ' | ' |
Recurring Fair Value Measurements | ' | ' |
Investment securities available for sale, at fair value | $1,477 | $1,553 |
FAIR_VALUE_MEASUREMENT_Details1
FAIR VALUE MEASUREMENT (Details 1) (USD $) | 9 Months Ended | 12 Months Ended |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Dec. 31, 2012 |
Non-Recurring Fair Value Measurements | ' | ' |
OREO | 2,942 | 3,055 |
Other Real Estate Owned- Fair Value | ' | ' |
Non-Recurring Fair Value Measurements | ' | ' |
Valuation technique | 'discounted appraisals | 'discounted appraisals |
Significant Unobservable Inputs | 'collateral discounts | 'collateral discounts |
General range of significant input values, minimum | 6.00% | 6.00% |
General range of significant input values, maximum | 20.00% | 20.00% |
Repossessed Collateral | ' | ' |
Non-Recurring Fair Value Measurements | ' | ' |
Valuation technique | 'discounted appraisals | 'discounted appraisals |
Significant Unobservable Inputs | 'collateral discounts | 'collateral discounts |
General range of significant input values, minimum | 20.00% | 20.00% |
General range of significant input values, maximum | 50.00% | 50.00% |
Impaired Loans | ' | ' |
Non-Recurring Fair Value Measurements | ' | ' |
Valuation technique | 'discounted appraisals | 'discounted appraisals |
Significant Unobservable Inputs | 'collateral discounts | 'collateral discounts |
General range of significant input values, minimum | 6.00% | 6.00% |
General range of significant input values, maximum | 20.00% | 20.00% |
Mortgage Servicing Rights | ' | ' |
Non-Recurring Fair Value Measurements | ' | ' |
Valuation technique | 'discounted cash flows | 'discounted cash flows |
Significant Unobservable Inputs | 'PSA speed: 426%; cost to service: 6.00%; discount rate: 10.00% | 'PSA speed: 426%; cost to service: 6.00%; discount rate: 10.00% |
Fair Value Measured on a Non-Recurring Basis | ' | ' |
Non-Recurring Fair Value Measurements | ' | ' |
OREO | 2,942 | 3,055 |
Repossessed Collateral | 590 | 590 |
Impaired Loans - Commercial Real Estate | 8,496 | 4,749 |
Impaired Loans - Faith-based non-profit | 17,020 | 14,863 |
Impaired Loans - Residential real estate | 3,790 | 3,916 |
Impaired Loans - Consumer | 13 | 16 |
Mortgage Servicing Rights | 25 | 36 |
Total Fair Value, non-recurring | 32,876 | 27,225 |
Fair Value Measured on a Non-Recurring Basis | Significant Unobservable Inputs (Level 3) | ' | ' |
Non-Recurring Fair Value Measurements | ' | ' |
OREO | 2,942 | 3,055 |
Repossessed Collateral | 590 | 590 |
Impaired Loans - Commercial Real Estate | 8,496 | 4,749 |
Impaired Loans - Faith-based non-profit | 17,020 | 14,863 |
Impaired Loans - Residential real estate | 3,790 | 3,916 |
Impaired Loans - Consumer | 13 | 16 |
Mortgage Servicing Rights | 25 | 36 |
Total Fair Value, non-recurring | 32,876 | 27,225 |
FAIR_VALUE_MEASUREMENT_Details2
FAIR VALUE MEASUREMENT (Details 2) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Dec. 31, 2011 |
In Thousands, unless otherwise specified | ||||
Assets: | ' | ' | ' | ' |
Cash and cash equivalents | $29,362 | $42,586 | $51,516 | $61,296 |
Investment securities available for sale, at fair value | 57,938 | 60,811 | ' | ' |
Loans, net | 183,919 | 171,723 | ' | ' |
Interest receivable | 862 | 858 | ' | ' |
Liabilities: | ' | ' | ' | ' |
Other borrowings | 867 | 2,937 | ' | ' |
Carrying Amount | ' | ' | ' | ' |
Assets: | ' | ' | ' | ' |
Cash and cash equivalents | 29,362 | 42,586 | ' | ' |
Investment securities available for sale, at fair value | 57,938 | 60,811 | ' | ' |
Loans, net | 183,919 | 171,723 | ' | ' |
Interest receivable | 862 | 858 | ' | ' |
Liabilities: | ' | ' | ' | ' |
Non-maturity deposits | 118,500 | 116,276 | ' | ' |
Maturity deposits | 131,375 | 134,603 | ' | ' |
Other borrowings | 867 | 2,937 | ' | ' |
Accrued interest payable | 90 | 119 | ' | ' |
Fair Value | ' | ' | ' | ' |
Assets: | ' | ' | ' | ' |
Cash and cash equivalents | 29,362 | 42,586 | ' | ' |
Investment securities available for sale, at fair value | 57,938 | 60,811 | ' | ' |
Loans, net | 181,266 | 175,041 | ' | ' |
Interest receivable | 862 | 858 | ' | ' |
Liabilities: | ' | ' | ' | ' |
Non-maturity deposits | 118,500 | 116,276 | ' | ' |
Maturity deposits | 130,992 | 134,322 | ' | ' |
Other borrowings | 805 | 2,871 | ' | ' |
Accrued interest payable | 90 | 119 | ' | ' |
Quoted Prices in Active Markets for Identical Assets (Level 1) | ' | ' | ' | ' |
Assets: | ' | ' | ' | ' |
Cash and cash equivalents | 29,362 | 42,586 | ' | ' |
Interest receivable | 862 | 858 | ' | ' |
Liabilities: | ' | ' | ' | ' |
Non-maturity deposits | 118,500 | 116,276 | ' | ' |
Accrued interest payable | 90 | 119 | ' | ' |
Significant Other Observable Inputs (Level 2) | ' | ' | ' | ' |
Assets: | ' | ' | ' | ' |
Investment securities available for sale, at fair value | 57,938 | 60,811 | ' | ' |
Liabilities: | ' | ' | ' | ' |
Maturity deposits | 130,992 | 134,322 | ' | ' |
Significant Unobservable Inputs (Level 3) | ' | ' | ' | ' |
Assets: | ' | ' | ' | ' |
Loans, net | 181,266 | 175,041 | ' | ' |
Liabilities: | ' | ' | ' | ' |
Other borrowings | $805 | $2,871 | ' | ' |