Financing Receivables [Text Block] | Note 6 – Loans and the Allowance for Loan Losses – Loans receivable at June 30, 2017 December 31, 2016 June 30, December 31, 2017 2016 (Dollars in thousands) Real estate loans: Construction and land $ 112,199 $ 94,426 Farmland 10,524 9,217 1-4 family residential 139,398 129,052 Multi-family residential 23,039 22,737 Nonfarm nonresidential 304,278 298,057 Commercial 238,924 213,120 Consumer 46,144 44,342 Total loans held for investment 874,506 810,951 Less: Allowance for loan losses (9,177 ) (8,162 ) Net loans $ 865,329 $ 802,789 The performing 1 4 June 30, 2017 December 31, 2016. Net deferred loan origination fees were $1.2 $761,000 June 30, 2017 December 31, 2016, June 30, 2017 December 31, 2016, $155,000 $232,000, The Bank is the lead lender on participations sold, without recourse, to other financial institutions which are not consolidated balance sheets. The unpaid principal balances of mortgages and other loans serviced for others were approximately $64.3 $55.5 June 30, 2017 December 31, 2016, The Bank grants loans and extensions of credit to individual s and a variety of businesses and corporations in markets across Louisiana and Texas. Management segregates the loan portfolio into portfolio segments which is defined as the level at which the Bank develops and documents a systematic method for determining its allowance for loan losses. The portfolio segments are segregated based on loan types and the underlying risk factors present in each loan type. Such risk factors are periodically reviewed by management and revised as deemed appropriate. Loans acquired in business combinations are initially recorded at fair value, which includes an estimate of credit losses expected to be realized over the remaining l ives of the loans and, therefore, no not Acquired loans are those associat ed with our acquisition of AGFC. These loans were recorded at estimated fair value at the acquisition date with no Total loans held for investment at June 30, 2017 $54.3 June 30, 2017 310 30, Loans and Debt Securities Acquired with Deteriorated Credit Quality 310 30” $749,000 not 310 30 $55.6 $2.0 Total loans held for investment at December 31, 2016 $65.3 December 31, 201 6 $1.8 $65.9 $2.4 The following table s set forth, as of June 30, 2017 December 31, 2016, not not Allowance for Credit Losses and Recorded Investment in Loans Receivable June 30, 2017 (Dollars in thousands) Real Estate: Real Estate: Real Estate: Real Estate: Construction Real Estate: 1-4 Family Multi-family Nonfarm and Land Farmland Residential Residential Nonresidential Commercial Consumer Total Allowance for credit losses: Beginning Balance $ 933 $ 75 $ 1,228 $ 172 $ 2,314 $ 3,039 $ 401 $ 8,162 Charge-offs (2 ) - (20 ) - (617 ) (53 ) (30 ) (722 ) Recoveries 1 - 14 - 1 30 31 77 Provision 255 13 320 13 745 326 (12 ) 1,660 Ending Balance $ 1,187 $ 88 $ 1,542 $ 185 $ 2,443 $ 3,342 $ 390 $ 9,177 Ending Balance: Individually evaluated for impairment $ 22 $ - $ 416 $ - $ 112 $ 482 $ - $ 1,032 Collectively evaluated for impairment $ 1,165 $ 88 $ 1,092 $ 185 $ 2,331 $ 2,860 $ 390 $ 8,111 Purchased Credit Impaired (1) $ - $ - $ 34 $ - $ - $ - $ - $ 34 Loans receivable: Ending Balance $ 112,199 $ 10,524 $ 139,398 $ 23,039 $ 304,278 $ 238,924 $ 46,144 $ 874,506 Ending Balance: Individually evaluated for impairment $ 133 $ - $ 2,916 $ - $ 3,049 $ 4,927 $ 235 $ 11,260 Collectively evaluated for impairment $ 112,053 $ 10,524 $ 136,270 $ 23,039 $ 300,705 $ 233,997 $ 45,909 $ 862,497 Purchased Credit Impaired (1) $ 13 $ - $ 212 $ - $ 524 $ - $ - $ 749 ( 1 . December 31, 2016 (Dollars in thousands) Real Estate: Real Estate: Real Estate: Real Estate: Construction Real Estate: 1-4 Family Multi-family Nonfarm and Land Farmland Residential Residential Nonresidential Commercial Consumer Total Allowance for credit losses: Beginning balance $ 600 $ 30 $ 1,021 $ 101 $ 1,416 $ 3,618 $ 458 $ 7,244 Charge-offs (484 ) - (162 ) - (473 ) (667 ) (3 ) (1,789 ) Recoveries 10 - 140 - 1,258 33 46 1,487 Provision 807 45 229 71 113 55 (100 ) 1,220 Ending Balance $ 933 $ 75 $ 1,228 $ 172 $ 2,314 $ 3,039 $ 401 $ 8,162 Ending Balance: Individually evaluated for impairment $ - $ - $ 252 $ - $ 98 $ 501 $ 36 $ 887 Collectively evaluated for impairment $ 933 $ 75 $ 943 $ 172 $ 2,216 $ 2,538 $ 365 $ 7,242 Purchased Credit Impaired (1) $ - $ - $ 33 $ - $ - $ - $ - $ 33 Loans receivable: Ending Balance $ 94,426 $ 9,217 $ 129,052 $ 22,737 $ 298,057 $ 213,120 $ 44,342 $ 810,951 Ending Balance: Individually evaluated for impairment $ 143 $ - $ 3,263 $ - $ 1,073 $ 7,332 $ 198 $ 12,009 Collectively evaluated for impairment $ 94,117 $ 9,217 $ 125,573 $ 22,737 $ 295,590 $ 205,788 $ 44,144 $ 797,166 Purchased Credit Impaired (1) $ 166 $ - $ 216 $ - $ 1,394 $ - $ - $ 1,776 ( 1 . Management further disaggregates the loan portfolio segments into classes of loans, which are based on the initial measurement of the loan, risk characteristics of the loan and the method for monitoring and assessing the credit risk of the loan. A s of June 30, 2017 December 31, 2016, Credit Qu ality Indicators June 30, 2017 Pass Special Mention Substandard Doubtful Total (Dollars in thousands) Real Estate Loans: Construction and land $ 109,643 $ 2,001 $ 409 $ 146 $ 112,199 Farmland 10,524 - - - 10,524 1-4 family residential 129,819 5,270 1,916 2,393 139,398 Multi-family residential 22,997 - 42 - 23,039 Nonfarm nonresidential 288,548 10,561 1,765 3,404 304,278 Commercial 209,394 21,211 3,392 4,927 238,924 Consumer 45,213 673 23 235 46,144 Total $ 816,138 $ 39,716 $ 7,547 $ 11,105 $ 874,506 December 31, 2016 Pass Special Mention Substandard Doubtful Total (Dollars in thousands) Real Estate Loans: Construction and land $ 92,951 $ 932 $ 300 $ 243 $ 94,426 Farmland 9,217 - - - 9,217 1-4 family residential 118,891 4,782 2,658 2,721 129,052 Multi-family residential 22,685 - 52 - 22,737 Nonfarm nonresidential 280,398 14,531 1,927 1,201 298,057 Commercial 186,197 16,783 7,377 2,763 213,120 Consumer 43,414 505 225 198 44,342 Total $ 753,753 $ 37,533 $ 12,539 $ 7,126 $ 810,951 The above classifications follow regulatory guidelines and can generally be described as follows: ● Pass loa ns are of satisfactory quality. ● Special mention loans have an existing weakness that could cause future impairment, including the deterioration of financial ratios, past due status, questionable management capabilities and possible reduction in the collat eral values. ● Substandard loans have an existing specific and well defined weakness that may may action is necessary. ● Doubtful loans have specific weaknesses that are severe enough to make collection or liquidation in full highly questionable and improbable. The following table s reflect certain information with respect to the loan portfolio delinquencies by loan class and amount as of June 30, 2017 December 31, 2016. 90 Aged Analysi s of Past Due Loans Receivable June 30, 2017 (Dollars in thousands) Recorded Greater Investment Over 30-59 Days 60-89 Days Than 90 Days Total Total Loans 90 Days Past Due Past Due Past Due Past Due Past Due Current Receivable and Still Accruing Real Estate Loans: Construction and land $ 37 $ 4 $ 137 $ 178 $ 112,021 $ 112,199 $ - Farmland - - - - 10,524 10,524 - 1-4 family residential 781 151 1,031 1,963 137,435 139,398 - Multi-family residential - - - - 23,039 23,039 - Nonfarm nonresidential 241 3,260 330 3,831 300,447 304,278 - Commercial 2,690 - 3,682 6,372 232,552 238,924 55 Consumer 6 - 224 230 45,914 46,144 - Total $ 3,755 $ 3,415 $ 5,404 $ 12,574 $ 861,932 $ 874,506 $ 55 December 31, 2016 (Dollars in thousands) Recorded Greater Investment Over 30-59 Days 60-89 Days Than 90 Days Total Total Loans 90 Days Past Due Past Due Past Due Past Due Past Due Current Receivable and Still Accruing Real Estate Loans: Construction and land $ 465 $ - $ 106 $ 571 $ 93,855 $ 94,426 $ - Farmland - - - - 9,217 9,217 - 1-4 family residential 989 579 963 2,531 126,521 129,052 117 Multi-family residential - - - - 22,737 22,737 - Nonfarm nonresidential 1,370 173 532 2,075 295,982 298,057 - Commercial 45 372 262 679 212,441 213,120 51 Consumer 66 - 149 215 44,127 44,342 - Total $ 2,935 $ 1,124 $ 2,012 $ 6,071 $ 804,880 $ 810,951 $ 168 The following is a summary of informati on pertaining to impaired loans as of June 30, 2017 December 31, 2016. $57,000 $138,000 six June 30, 2017 2016, June 30, 2017 (Dollars in thousands) Unpaid Average Recorded Principal Related Recorded Investment Balance Allowance Investment With an allowance recorded: Real Estate Loans: Construction and land $ 89 $ 89 $ 22 $ 60 Farmland - - - - 1-4 family residential 989 1,069 415 808 Multi-family residential - - - - Nonfarm nonresidential 693 708 112 422 Other Loans: Commercial 596 617 483 487 Consumer - - - 10 Total $ 2,367 $ 2,483 $ 1,032 $ 1,787 With no allowance recorded: Real Estate Loans: Construction and land $ 44 $ 54 $ - $ 77 Farmland - - - - 1-4 family residential 1,927 2,290 - 2,309 Multi-family residential - - - - Nonfarm nonresidential 2,356 2,406 - 2,009 Other Loans: Commercial 4,331 5,575 - 5,598 Consumer 235 266 - 124 Total $ 8,893 $ 10,591 $ - $ 10,117 Total Impaired Loans: Real Estate Loans: Construction and land $ 133 $ 143 $ 22 $ 137 Farmland - - - - 1-4 family residential 2,916 3,359 415 3,117 Multi-family residential - - - - Nonfarm nonresidential 3,049 3,114 112 2,431 Other Loans: Commercial 4,927 6,192 483 6,085 Consumer 235 266 - 134 Total $ 11,260 $ 13,074 $ 1,032 $ 11,904 December 31, 2016 (Dollars in thousands) Unpaid Average Recorded Principal Related Recorded Investment Balance Allowance Investment With an allowance recorded: Real Estate Loans: Construction and land $ - $ - $ - $ 655 Farmland - - - - 1-4 family residential 440 470 252 372 Multi-family residential - - - - Nonfarm nonresidential 368 368 98 31 Other Loans: Commercial 695 709 501 1,252 Consumer 36 36 36 12 Total $ 1,539 $ 1,583 $ 887 $ 2,322 With no allowance recorded: Real Estate Loans: Construction and land $ 143 $ 152 $ - $ 124 Farmland - - - - 1-4 family residential 2,823 3,276 - 3,296 Multi-family residential - - - - Nonfarm nonresidential 705 729 - 3,730 Other Loans: Commercial 6,637 7,826 - 3,680 Consumer 162 162 - 43 Total $ 10,470 $ 12,145 $ - $ 10,873 Total Impaired Loans: Real Estate Loans: Construction and land $ 143 $ 152 $ - $ 779 Farmland - - - - 1-4 family residential 3,263 3,746 252 3,668 Multi-family residential - - - - Nonfarm nonresidential 1,073 1,097 98 3,761 Other Loans: Commercial 7,332 8,535 501 4,932 Consumer 198 198 36 55 Total $ 12,009 $ 13,728 $ 887 $ 13,195 The Company elected to account for certain loans acquired in the AGFC merger as acquired impaired loans under ASC 310 30 acquisition and the probability that the Company will be unable to collect all contractually required payments. The expected cash flows approximated fair value as of the date of merger and, as a result, no The following table presents the changes in the carrying amount o f the purchased impaired credits accounted for under ASC 310 30 Purchased Impaired Credits (Dollars in thousands) Carrying amount - December 31, 2015 $ 3,634 Payments received, net of discounts realized (1,181 ) Charge-offs (352 ) Transfer to other real estate (325 ) Carrying amount - December 31, 2016 1,776 Payments received, net of discounts realized (871 ) Purchased impaired credit participation interest sales proceeds, net of discount realized 444 Charge-offs (600 ) Carrying amount - June 30, 2017 $ 749 The Bank seeks t o assist customers that are experiencing financial difficulty by renegotiating loans within lending regulations and guidelines. The Bank makes loan modifications, primarily utilizing internal renegotiation programs via direct customer contact, that manage customers’ debt exposures held only by the Bank. Additionally, the Bank makes loan modifications with customers who have elected to work with external renegotiation agencies and these modifications provide solutions to customers’ entire unsecured debt structures. During the periods ended June 30, 2017 December 31, 2016, Once modified in a troubled debt restructuring, a loan is generally considered impaired until its contractual maturity. At the time of the restructuring, the loan is evaluated for an asset-specific allowance for credit losses. The Bank continues to specifically reevaluate the loan in subsequent periods, regardless of the borrower’s performance under the modified terms. If a borrower subsequently defaults on the loan after it is restructured, the Bank provides an allowance for credit losses for the amount of the loan that exceeds the value of the related collateral. The following tables present info rmative data regarding troubled debt restructurings as of June 30, 2017 December 31, 2016. $3.3 six June 30, 2017 none December 31, 2016. Modifications as of June 30, 2017: Pre-Modification Post-Modification Number Outstanding Outstanding of Recorded Recorded Contracts Investment Investment (Dollars in thousands) Troubled Debt Restructuring Real Estate Loans: 1-4 family residential 3 $ 870 $ 591 Other Loans: Commercial 3 5,144 3,991 Total 6 $ 6,014 $ 4,582 Modifications as of December 31, 2016: Pre-Modification Post-Modification Number Outstanding Outstanding of Recorded Recorded Contracts Investment Investment (Dollars in thousands) Troubled Debt Restructuring Real Estate Loans: 1-4 family residential 3 $ 870 $ 608 Other Loans: Commercial 6 6,880 5,323 Total 9 $ 7,750 $ 5,931 |