Financing Receivables [Text Block] | 5. The Company separates its loan portfolio into segments to perform the calculation and analysis of the allowance for loan losses. The six not not not Activity in the allowance for loan losses during the three nine September 30, 2018 000s Agriculture and Agricultural Real Estate Commercial Commercial Real Estate Construction Real Estate Residential Real Estate Consumer and Other Total Allowance for loan losses: For the three months ended September 30, 2018 Beginning Balance $ 262 $ 1,449 $ 2,949 $ 474 $ 1,142 $ 1,682 $ 7,958 Charge-offs - - (80 ) - (6 ) (11 ) (97 ) Recoveries 3 34 15 12 34 27 125 Provision 61 (77 ) (419 ) (14 ) (134 ) 583 - Ending balance $ 326 $ 1,406 $ 2,465 $ 472 $ 1,036 $ 2,281 $ 7,986 Allowance for loan losses: For the nine months ended September 30, 2018 Beginning Balance $ 195 $ 1,443 $ 3,297 $ 491 $ 1,279 $ 961 $ 7,666 Charge-offs - - (83 ) - (64 ) (13 ) (160 ) Recoveries 5 65 304 46 107 53 580 Provision 126 (102 ) (1,053 ) (65 ) (286 ) 1,280 (100 ) Ending balance $ 326 $ 1,406 $ 2,465 $ 472 $ 1,036 $ 2,281 $ 7,986 Allowance for loan losses as of September 30, 2018 Ending balance individually evaluated for impairment $ - $ 162 $ 173 $ 340 $ 107 $ 149 $ 931 Ending balance collectively evaluated for impairment 326 1,244 2,292 132 929 2,132 7,055 Ending balance $ 326 $ 1,406 $ 2,465 $ 472 $ 1,036 $ 2,281 $ 7,986 Loans as of September 30, 2018 Ending balance individually evaluated for impairment $ 1,127 $ 246 $ 4,617 $ 1,546 $ 4,153 $ 406 $ 12,095 Ending balance collectively evaluated for impairment 21,497 153,942 265,927 23,583 225,332 50,336 740,617 Ending balance $ 22,624 $ 154,188 $ 270,544 $ 25,129 $ 229,485 $ 50,742 $ 752,712 Activity in the allowance for loan losses during the three nine September 30, 2017 000s Agriculture and Agricultural Real Estate Commercial Commercial Real Estate Construction Real Estate Residential Real Estate Consumer and Other Total Allowance for loan losses: For the three months ended September 30, 2017 Beginning Balance $ 320 $ 1,496 $ 3,359 $ 541 $ 1,398 $ 1,023 $ 8,137 Charge-offs - (6 ) (163 ) - (49 ) (88 ) (306 ) Recoveries 77 18 23 13 31 17 179 Provision (67 ) (199 ) 56 (56 ) (134 ) 400 - Ending balance $ 330 $ 1,309 $ 3,275 $ 498 $ 1,246 $ 1,352 $ 8,010 Allowance for loan losses: For the nine months ended September 30, 2017 Beginning Balance $ 201 $ 1,632 $ 3,336 $ 525 $ 1,599 $ 1,165 $ 8,458 Charge-offs - (6 ) (572 ) - (99 ) (137 ) (814 ) Recoveries 80 116 97 39 177 57 566 Provision 49 (433 ) 414 (66 ) (431 ) 267 (200 ) Ending balance $ 330 $ 1,309 $ 3,275 $ 498 $ 1,246 $ 1,352 $ 8,010 Allowance for loan losses as of September 30, 2017 Ending balance individually evaluated for impairment $ 1 $ 139 $ 16 $ 367 $ 174 $ 206 $ 903 Ending balance collectively evaluated for impairment 329 1,170 3,259 131 1,072 1,146 7,107 Ending balance $ 330 $ 1,309 $ 3,275 $ 498 $ 1,246 $ 1,352 $ 8,010 Loans as of September 30, 2017 Ending balance individually evaluated for impairment $ 1,095 $ 220 $ 2,622 $ 1,598 $ 5,368 $ 433 $ 11,336 Ending balance collectively evaluated for impairment 22,346 122,773 268,893 20,544 211,046 36,928 682,530 Ending balance $ 23,441 $ 122,993 $ 271,515 $ 22,142 $ 216,414 $ 37,361 $ 693,866 Each period the provision for loan losses in the income statement results from the combination of an estimate by Management of loan losses that occurred during the current period and the ongoing adjustment of prior estimates of losses occurring in prior periods. The provision for loan losses increases the allowance for loan losses, a valuation account which appears on the consolidated balance sheets. As the specific customer and amount of a loan loss is confirmed by gathering additional information, taking collateral in full or partial settlement of the loan, bankruptcy of the borrower, etc., the loan is charged off, reducing the allowance for loan losses. If, subsequent to a charge off, the Bank is able to collect additional amounts from the customer or sell collateral worth more than earlier estimated, a recovery is recorded. To serve as a basis for making this provision, the Bank maintains an extensive credit risk monitoring process that considers several factors including: current economic conditions affecting the Bank’s customers, the payment performance of individual loans and pools of homogeneous loans, portfolio seasoning, changes in collateral values, and detailed reviews of specific loan relationships. The Company utilizes an internal loan grading system to assign a risk grade to all commercial loans, all renegotiated loans, and each commercial credit relationship. Grades 10 45 50 55 60 50 60 70 90 • Grade 10– • Grade 20– may • Grade 30– may not • Grades 40 45 not • Grades 50 55 may • Grade 60– one 1 2 3 4 not 5 6 7 8 9 10 • Grade 70– one 1 not 2 3 may • Grades 80 90 not The assessment of compensating factors may one not The portfolio segments in each credit risk grade as of September 30, 2018 000s Credit Quality Indicators as of September 30, 2018 Credit Risk by Internally Assigned Grade Agriculture and Agricultural Real Estate Commercial Commercial Real Estate Construction Real Estate Residential Real Estate Consumer and Other Total Not Rated $ - $ 2,573 $ 114 $ 11,612 $ 146,009 $ 45,226 $ 205,534 10 - 6,805 - - - - 6,805 20 281 115 206 - - - 602 30 490 44,661 23,963 - 1,273 3,662 74,049 40 16,046 93,097 213,410 8,979 73,940 1,840 407,312 45 1,336 2,082 15,442 1,402 2,730 - 22,992 50 1,879 4,355 10,799 1,590 2,185 - 20,808 55 - 251 2,108 1,510 731 - 4,600 60 2,592 249 4,502 36 2,617 14 10,010 70 - - - - - - - 80 - - - - - - - 90 - - - - - - - Total $ 22,624 $ 154,188 $ 270,544 $ 25,129 $ 229,485 $ 50,742 $ 752,712 Performing $ 21,946 $ 153,889 $ 266,992 $ 23,583 $ 224,627 $ 50,322 $ 741,359 Nonperforming 678 299 3,552 1,546 4,858 420 11,353 Total $ 22,624 $ 154,188 $ 270,544 $ 25,129 $ 229,485 $ 50,742 $ 752,712 The portfolio segments in each credit risk grade as of December 31, 2017 000s Credit Quality Indicators as of December 31, 2017 Credit Risk by Internally Assigned Grade Agriculture and Agricultural Real Estate Commercial Commercial Real Estate Construction Real Estate Residential Real Estate Consumer and Other Total Not Rated $ - $ 1,341 $ 160 $ 13,903 $ 135,311 $ 30,359 $ 181,074 10 - 6,870 - - - - 6,870 20 281 293 353 - - - 927 30 503 29,655 6,300 - 941 3,972 41,371 40 14,819 76,792 223,468 4,857 72,634 1,947 394,517 45 1,414 2,391 12,244 1,528 5,363 - 22,940 50 1,864 3,778 21,802 1,667 3,590 6 32,707 55 1,441 594 1,857 1,537 867 2 6,298 60 909 505 3,460 66 3,308 27 8,275 70 - - - - - - - 80 - - - - - - - 90 - - - - - - - Total $ 21,231 $ 122,219 $ 269,644 $ 23,558 $ 222,014 $ 36,313 $ 694,979 Performing $ 20,665 $ 121,768 $ 265,801 $ 21,955 $ 215,643 $ 35,861 $ 681,693 Nonperforming 566 451 3,843 1,603 6,371 452 13,286 Total $ 21,231 $ 122,219 $ 269,644 $ 23,558 $ 222,014 $ 36,313 $ 694,979 Loans are considered past due when contractually required payment of interest or principal has not not September 30, 2018 December 31, 2017 ( 000s September 30, 2018 30-59 Days Past Due 60-89 Days Past Due >90 Days Past Due Total Past Due Current Total Loans Recorded Investment >90 Days Past Due and Accruing Agriculture and Agricultural Real Estate $ 56 $ - $ 75 $ 131 $ 22,493 $ 22,624 $ - Commercial 388 109 30 $ 527 153,661 154,188 5 Commercial Real Estate 402 - 1,852 2,254 268,290 270,544 - Construction Real Estate - - - - 25,129 25,129 - Residential Real Estate 1,098 74 492 1,664 227,821 229,485 - Consumer and Other 53 - - 53 50,689 50,742 - Total $ 1,997 $ 183 $ 2,449 $ 4,629 $ 748,083 $ 752,712 $ 5 December 31, 2017 30-59 Days Past Due 60-89 Days Past Due >90 Days Past Due Total Past Due Current Total Loans Recorded Investment >90 Days Past Due and Accruing Agriculture and Agricultural Real Estate $ - $ - $ - $ - $ 21,231 $ 21,231 $ - Commercial 111 8 5 124 122,095 122,219 3 Commercial Real Estate 834 783 56 1,673 267,971 269,644 - Construction Real Estate 17 - - 17 23,541 23,558 - Residential Real Estate 1,361 58 871 2,290 219,724 222,014 - Consumer and Other 55 2 - 57 36,256 36,313 - Total $ 2,378 $ 851 $ 932 $ 4,161 $ 690,818 $ 694,979 $ 3 Loans are placed on non-accrual status when, in the opinion of Management, the collection of additional interest is doubtful. Loans are automatically placed on non-accrual status upon becoming ninety may not The following is a summary of non-accrual loans as of September 30, 2018 December 31, 2017 ( 000s September 30, 2018 December 31, 2017 Agriculture and Agricultural Real Estate $ 119 $ - Commercial 104 243 Commercial Real Estate 2,939 1,580 Construction Real Estate 7 33 Residential Real Estate 1,311 1,783 Consumer and Other 14 19 Total $ 4,494 $ 3,658 For loans deemed to be impaired due to an expectation that all contractual payments will probably not The following is a summary of impaired loans as of September 30, 2018 September 30, December 31, 2017 ( 000s September 30, 2018 Recorded Investment Unpaid Principal Balance Related Allowance Average Recorded Investment for the Three Months Ended Interest Income Recognized in the Three Months Ended Average Recorded Investment for the Nine Months Ended Interest Income Recognized in the Nine Months Ended With no related allowance recorded: Agriculture and Agricultural Real Estate $ 891 $ 888 $ - $ 889 $ 12 $ 903 $ 35 Commercial - - - - - - - Commercial Real Estate 2,873 2,875 - 2,896 7 2,902 72 Construction Real Estate - - - - - - - Residential Real Estate 3,809 3,983 - 4,006 41 4,058 149 Consumer and Other 32 32 - 33 1 34 2 With an allowance recorded: Agriculture and Agricultural Real Estate 236 236 - 236 3 238 9 Commercial 246 253 162 256 3 261 9 Commercial Real Estate 1,744 1,807 173 1,878 27 1,895 84 Construction Real Estate 1,546 1,580 340 1,572 19 1,585 56 Residential Real Estate 344 352 107 355 4 359 12 Consumer and Other 374 375 149 377 3 382 8 Total: Agriculture and Agricultural Real Estate $ 1,127 $ 1,124 $ - $ 1,125 $ 15 $ 1,141 $ 44 Commercial 246 253 162 256 3 261 9 Commercial Real Estate 4,617 4,682 173 4,774 34 4,797 156 Construction Real Estate 1,546 1,580 340 1,572 19 1,585 56 Residential Real Estate 4,153 4,335 107 4,361 45 4,417 161 Consumer and Other 406 407 149 410 4 416 10 Total $ 12,095 $ 12,381 $ 931 $ 12,498 $ 120 $ 12,617 $ 436 Recorded Investment as of December 31, 2017 Unpaid Principal Balance as of December 31, 2017 Related Allowance as of December 31, 2017 Average Recorded Investment for the Three Months Ended September 30, 2017 Interest Income Recognized in the Three Months Ended September 30, 2017 Average Recorded Investment for the Nine Months Ended September 30, 2017 Interest Income Recognized in the Nine Months Ended September 30, 2017 With no related allowance recorded: Agriculture and Agricultural Real Estate $ 829 $ 826 $ - $ 849 $ 11 $ 850 $ 32 Commercial - - - - - - - Commercial Real Estate 1,977 2,034 - 2,177 23 2,238 59 Construction Real Estate 17 21 - - - - - Residential Real Estate 3,757 3,935 - 4,054 51 4,110 150 Consumer and Other 30 30 - - - 1 - With an allowance recorded: Agriculture and Agricultural Real Estate 241 240 1 242 3 244 10 Commercial 265 268 148 220 2 224 7 Commercial Real Estate 1,776 1,783 219 614 6 621 17 Construction Real Estate 1,586 1,619 360 1,622 19 1,635 57 Residential Real Estate 1,464 1,515 177 1,537 16 1,552 45 Consumer and Other 402 403 205 437 5 444 15 Total: Agriculture and Agricultural Real Estate $ 1,070 $ 1,066 $ 1 $ 1,091 $ 14 $ 1,094 $ 42 Commercial 265 268 148 220 2 224 7 Commercial Real Estate 3,753 3,817 219 2,791 29 2,859 76 Construction Real Estate 1,603 1,640 360 1,622 19 1,635 57 Residential Real Estate 5,221 5,450 177 5,591 67 5,662 195 Consumer and Other 432 433 205 437 5 445 15 Total $ 12,344 $ 12,674 $ 1,110 $ 11,752 $ 136 $ 11,919 $ 392 The Bank may may Loans that have been classified as TDRs during the three nine September 30, 2018 September 30, 2017 000s Three months ended Nine months ended September 30, 2018 September 30, 2018 Number of Contracts Pre- Modification Recorded Principal Balance Post- Modification Recorded Principal Balance Number of Contracts Pre- Modification Recorded Principal Balance Post- Modification Recorded Principal Balance Agriculture and Agricultural Real Estate - $ - $ - - $ - $ - Commercial - - - - - - Commercial Real Estate 1 58 53 2 341 333 Construction Real Estate - - - - - - Residential Real Estate 1 78 78 3 250 228 Consumer and Other - - - - - - Total 2 $ 136 $ 131 5 $ 591 $ 561 Three months ended Nine months ended September 30, 2017 September 30, 2017 Number of Contracts Pre- Modification Recorded Principal Balance Post- Modification Recorded Principal Balance Number of Contracts Pre- Modification Recorded Principal Balance Post- Modification Recorded Principal Balance Agriculture and Agricultural Real Estate - $ - $ - - $ - $ - Commercial - - - 2 29 29 Commercial Real Estate 1 225 202 4 578 492 Construction Real Estate - - - - - - Residential Real Estate 1 99 99 5 371 229 Consumer and Other - - - 1 1 - Total 2 $ 324 $ 301 12 $ 979 $ 750 The Bank considers TDRs that become past due under the modified terms as defaulted. The following table shows the loans that became TDRs during the nine September 30, 2018 September 30, 2017 nine September 30, 2018 September 30, 2017, Nine months ended Nine months ended September 30, 2018 September 30, 2017 Number of Contracts Recorded Principal Balance Number of Contracts Recorded Principal Balance Agriculture and Agricultural Real Estate - $ - - $ - Commercial - - - - Commercial Real Estate - - - - Construction Real Estate - - - - Residential Real Estate - - 1 99 Consumer and Other - - - - Total - $ - 1 $ 99 The Company has allocated $871,000 September 30, 2018. no September 30, 2018 September 30, 2017. |