Document_and_Entity_Informatio
Document and Entity Information | 9 Months Ended | |
Sep. 30, 2014 | Oct. 31, 2014 | |
Document and Entity Information | ' | ' |
Entity Registrant Name | 'MACKINAC FINANCIAL CORP /MI/ | ' |
Entity Central Index Key | '0000036506 | ' |
Document Type | '10-Q | ' |
Document Period End Date | 30-Sep-14 | ' |
Amendment Flag | 'false | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Entity Current Reporting Status | 'Yes | ' |
Entity Filer Category | 'Smaller Reporting Company | ' |
Entity Common Stock, Shares Outstanding | ' | 5,564,815 |
Document Fiscal Year Focus | '2014 | ' |
Document Fiscal Period Focus | 'Q3 | ' |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2013 |
In Thousands, unless otherwise specified | |||
ASSETS | ' | ' | ' |
Cash and due from banks | $22,399 | $18,216 | $22,791 |
Federal funds sold | 2 | 3 | 3 |
Cash and cash equivalents | 22,401 | 18,219 | 22,794 |
Interest-bearing deposits in other financial institutions | 235 | 10 | 10 |
Securities available for sale | 48,742 | 44,388 | 48,096 |
Federal Home Loan Bank stock | 3,060 | 3,060 | 3,060 |
Loans: | ' | ' | ' |
Commercial | 383,759 | 359,368 | 353,526 |
Mortgage | 119,039 | 110,663 | 104,504 |
Consumer | 15,575 | 13,801 | 14,465 |
Total Loans | 518,373 | 483,832 | 472,495 |
Allowance for loan losses | -5,279 | -4,661 | -4,959 |
Net loans | 513,094 | 479,171 | 467,536 |
Premises and equipment | 9,821 | 10,210 | 10,484 |
Other real estate held for sale | 1,843 | 1,884 | 2,568 |
Deferred Tax Asset | 8,681 | 9,933 | 7,953 |
Other assets | 6,066 | 5,925 | 5,416 |
TOTAL ASSETS | 613,943 | 572,800 | 567,917 |
Deposits: | ' | ' | ' |
Noninterest bearing deposits | 84,073 | 72,936 | 70,063 |
NOW, money market, interest checking | 173,793 | 149,123 | 158,588 |
Savings | 15,263 | 13,039 | 12,694 |
CDs less than $100,000 | 130,821 | 140,495 | 133,821 |
CDs more than $100,000 | 24,891 | 23,159 | 23,816 |
Brokered | 62,365 | 67,547 | 62,706 |
Total deposits | 491,206 | 466,299 | 461,688 |
Borrowings | 44,909 | 37,852 | 35,852 |
Other liabilities | 3,196 | 3,400 | 3,332 |
Total liabilities | 546,811 | 507,551 | 500,872 |
Borrowings: | ' | ' | ' |
Fed funds purchased | 7,500 | ' | ' |
SHAREHOLDERS' EQUITY: | ' | ' | ' |
Preferred stock - No par value: Authorized 500,000 shares, Issued and outstanding - none and 4,000 shares | ' | ' | 4,000 |
Common stock and additional paid in capital - No par value Authorized - 18,000,000 shares Issued and outstanding - 5,564,815; 5,541,390; and 5,581,339 shares respectively | 53,800 | 53,621 | 53,915 |
Retained earnings | 12,923 | 11,412 | 8,780 |
Accumulated other comprehensive income | 409 | 216 | 350 |
Total shareholders' equity | 67,132 | 65,249 | 67,045 |
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | $613,943 | $572,800 | $567,917 |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parenthetical) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2013 |
Consolidated Balance Sheets | ' | ' | ' |
Preferred stock, par value | $0 | $0 | $0 |
Preferred stock, Authorized shares | 500,000 | 500,000 | 500,000 |
Preferred stock, shares issued | 0 | 0 | 4,000 |
Preferred stock, shares outstanding | 0 | 0 | 4,000 |
Common stock, par value | $0 | $0 | $0 |
Common stock, Authorized shares | 18,000,000 | 18,000,000 | 18,000,000 |
Common stock, Shares issued | 5,564,815 | 5,541,390 | 5,581,339 |
Common stock, Shares outstanding | 5,564,815 | 5,541,390 | 5,581,339 |
Consolidated_Statements_of_Ope
Consolidated Statements of Operations (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 |
Interest and fees on loans: | ' | ' | ' | ' |
Taxable | $6,651 | $6,077 | $19,305 | $17,980 |
Tax-exempt | 4 | 26 | 27 | 81 |
Interest on securities: | ' | ' | ' | ' |
Taxable | 230 | 245 | 711 | 726 |
Tax-exempt | 14 | 9 | 41 | 22 |
Other interest income | 34 | 33 | 114 | 96 |
Total interest income | 6,933 | 6,390 | 20,198 | 18,905 |
INTEREST EXPENSE: | ' | ' | ' | ' |
Deposits | 813 | 879 | 2,435 | 2,642 |
Borrowings | 234 | 163 | 625 | 490 |
Total interest expense | 1,047 | 1,042 | 3,060 | 3,132 |
Net interest income | 5,886 | 5,348 | 17,138 | 15,773 |
Provision for loan losses | 187 | 375 | 561 | 850 |
Net interest income after provision for loan losses | 5,699 | 4,973 | 16,577 | 14,923 |
OTHER INCOME: | ' | ' | ' | ' |
Deposit service fees | 168 | 158 | 517 | 495 |
Income from loans sold on secondary market | 212 | 203 | 455 | 781 |
SBA/USDA loan sale gains | ' | 135 | 548 | 798 |
Mortgage servicing income | 313 | 128 | 415 | 413 |
Net security gains (losses) | ' | ' | ' | 29 |
Other | 75 | 114 | 174 | 260 |
Total other income | 768 | 738 | 2,109 | 2,747 |
OTHER EXPENSE: | ' | ' | ' | ' |
Salaries and employee benefits | 2,481 | 2,226 | 7,545 | 6,907 |
Occupancy | 511 | 362 | 1,595 | 1,107 |
Furniture and equipment | 305 | 274 | 927 | 799 |
Data processing | 288 | 269 | 862 | 802 |
Professional service fees | 276 | 161 | 883 | 706 |
Loan and deposit | 144 | 55 | 306 | 173 |
Writedowns and losses on other real estate held for sale | 176 | 57 | 190 | 146 |
FDIC insurance assessment | 92 | 100 | 267 | 300 |
Telephone | 84 | 84 | 248 | 229 |
Advertising | 114 | 119 | 344 | 334 |
Other | 655 | 652 | 1,964 | 1,690 |
Total other expenses | 5,126 | 4,359 | 15,131 | 13,193 |
Income before provision for income taxes | 1,341 | 1,352 | 3,555 | 4,477 |
Provision for (benefit of) for income taxes | 455 | 456 | 1,203 | 1,508 |
NET INCOME | 886 | 896 | 2,352 | 2,969 |
Preferred dividend and accretion of discount | ' | 50 | ' | 250 |
NET INCOME AVAILABLE TO COMMON SHAREHOLDERS | $886 | $846 | $2,352 | $2,719 |
INCOME PER COMMON SHARE: | ' | ' | ' | ' |
Basic (in dollars per share) | $0.16 | $0.15 | $0.43 | $0.49 |
Diluted (in dollars per share) | $0.16 | $0.15 | $0.42 | $0.49 |
Consolidated_Statements_of_Com
Consolidated Statements of Comprehensive Income (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 |
Consolidated Statements of Comprehensive Income | ' | ' | ' | ' |
Net income | $886 | $896 | $2,352 | $2,969 |
Net change in net unrealized gains and losses on securities available for sale: | ' | ' | ' | ' |
Unrealized gains (losses) arising during the period | -53 | -136 | 292 | -899 |
Less: reclassification adjustment for gains included in net income | ' | 14 | ' | 29 |
Net securities gain (loss) during the period | -53 | -122 | 292 | -870 |
Tax effect | 13 | 42 | -99 | 296 |
Other comprehensive income (loss) | -40 | -80 | 193 | -574 |
Total comprehensive income | $846 | $816 | $2,545 | $2,395 |
Consolidated_Statements_of_Cha
Consolidated Statements of Changes in Shareholders' Equity (USD $) | Common Shareholders' Equity | Preferred Stock Series A | Total |
In Thousands, except Share data, unless otherwise specified | |||
Balance, beginning of period at Dec. 31, 2012 | $61,448 | $11,000 | $72,448 |
Increase (Decrease) in Shareholders' Equity | ' | ' | ' |
Net income | 2,969 | ' | 2,969 |
Other comprehensive income (loss): | ' | ' | ' |
Net unrealized gain on securities available for sale | -574 | ' | -574 |
Total comprehensive income | 2,395 | ' | 2,395 |
Stock compensation | 258 | ' | 258 |
Repurchase of common stock | -140 | ' | -140 |
Dividend on common stock | -666 | ' | -666 |
Dividend on preferred stock | -250 | ' | -250 |
Redemption of Preferred Series A stock | ' | -7,000 | -7,000 |
Balance, end of period at Sep. 30, 2013 | 63,045 | 4,000 | 67,045 |
Balance, beginning of period at Dec. 31, 2012 | 61,448 | ' | ' |
Other comprehensive income (loss): | ' | ' | ' |
Repurchase of common stock (in shares) | -55,594 | ' | ' |
Balance, end of period at Dec. 31, 2013 | 65,249 | ' | ' |
Balance, beginning of period at Jun. 30, 2013 | 62,520 | 4,000 | 66,520 |
Increase (Decrease) in Shareholders' Equity | ' | ' | ' |
Net income | 896 | ' | 896 |
Other comprehensive income (loss): | ' | ' | ' |
Net unrealized gain on securities available for sale | -80 | ' | -80 |
Total comprehensive income | 816 | ' | 816 |
Stock compensation | 75 | ' | 75 |
Repurchase of common stock | -94 | ' | -94 |
Dividend on common stock | -222 | ' | -222 |
Dividend on preferred stock | -50 | ' | -50 |
Balance, end of period at Sep. 30, 2013 | 63,045 | ' | 67,045 |
Balance, beginning of period at Dec. 31, 2013 | 65,249 | ' | ' |
Other comprehensive income (loss): | ' | ' | ' |
Repurchase of common stock (in shares) | -13,700 | ' | ' |
Balance, end of period at Mar. 31, 2014 | ' | ' | ' |
Balance, beginning of period at Dec. 31, 2013 | 65,249 | ' | 65,249 |
Increase (Decrease) in Shareholders' Equity | ' | ' | ' |
Net income | 2,352 | ' | 2,352 |
Other comprehensive income (loss): | ' | ' | ' |
Net unrealized gain on securities available for sale | 193 | ' | 193 |
Total comprehensive income | 2,545 | ' | 2,545 |
Stock compensation | 321 | ' | 321 |
Repurchase of common stock | -143 | ' | -143 |
Dividend on common stock | -840 | ' | -840 |
Balance, end of period at Sep. 30, 2014 | 67,132 | ' | 67,132 |
Balance, beginning of period at Jun. 30, 2014 | 66,477 | ' | 66,477 |
Increase (Decrease) in Shareholders' Equity | ' | ' | ' |
Net income | 886 | ' | 886 |
Other comprehensive income (loss): | ' | ' | ' |
Net unrealized gain on securities available for sale | -40 | ' | -40 |
Total comprehensive income | 846 | ' | 846 |
Stock compensation | 96 | ' | 96 |
Dividend on common stock | -287 | ' | -287 |
Balance, end of period at Sep. 30, 2014 | $67,132 | ' | $67,132 |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (USD $) | 9 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 |
Cash Flows from Operating Activities: | ' | ' |
Net income | $2,352 | $2,969 |
Adjustments to reconcile net income to net cash provided by operating activities: | ' | ' |
Depreciation and amortization | 1,115 | 1,264 |
Provision for loan losses | 561 | 850 |
Deferred income taxes, net | 1,203 | 1,508 |
(Gain) loss on sales/calls of securities | ' | -29 |
(Gain) on sale of loans sold to secondary market | -358 | -609 |
Origination of loans held for sale in secondary market | -21,395 | -44,568 |
Proceeds from sale of loans in the secondary market | 21,753 | 45,177 |
Loss on sale of premises, equipment, and other real estate held for sale | 77 | 13 |
Writedown of other real estate held for sale | 142 | 134 |
Stock compensation | 321 | 258 |
Change in other assets | -141 | -201 |
Change in other liabilities | -204 | 283 |
Net cash provided by operating activities | 5,426 | 7,049 |
Cash Flows from Investing Activities: | ' | ' |
Net increase in loans | -35,022 | -25,393 |
Net decrease in deposits held at other bank | -225 | ' |
Purchase of securities available for sale | -8,257 | -7,875 |
Proceeds from maturities, sales, calls or paydowns of securities available for sale | 4,059 | 2,378 |
Capital expenditures | -1,156 | -757 |
Proceeds from sale of premises, equipment, and other real estate | 876 | 1,429 |
Net cash (used in) investing activities | -39,725 | -30,218 |
Cash Flows from Financing Activities: | ' | ' |
Net increase in deposits | 24,907 | 27,131 |
Net increase in borrowings | 7,330 | ' |
Repurchase of common stock | -143 | -140 |
Dividend on common stock | -840 | -666 |
Redemption of Series A Preferred Stock | ' | -7,000 |
Dividend on preferred stock | ' | -250 |
Principal payments on borrowings | -273 | -73 |
Net cash provided by financing activities | 38,481 | 19,002 |
Net increase in fed funds purchased | 7,500 | ' |
Net (decrease) in cash and cash equivalents | 4,182 | -4,167 |
Cash and cash equivalents at beginning of period | 18,219 | 26,961 |
Cash and cash equivalents at end of period | 22,401 | 22,794 |
Cash paid during the year for: | ' | ' |
Interest | 3,058 | 2,721 |
Income taxes | 75 | 124 |
Noncash Investing and Financing Activities: | ' | ' |
Transfers of Foreclosures from Loans to Other Real Estate Held for Sale(net of adjustments made through the allowance for loan losses) | $488 | $932 |
SUMMARY_OF_SIGNIFICANT_ACCOUNT
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 9 Months Ended |
Sep. 30, 2014 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ' |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ' |
1.SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Basis of Presentation | |
The unaudited condensed consolidated financial statements of Mackinac Financial Corporation (the “Corporation”) have been prepared in accordance with generally accepted accounting principles for interim financial information and the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the nine-month period ended September 30, 2014 are not necessarily indicative of the results that may be expected for the year ending December 31, 2014. The unaudited consolidated financial statements and footnotes thereto should be read in conjunction with the audited consolidated financial statements and footnotes thereto included in the Corporation’s Annual Report on Form 10-K for the year ended December 31, 2013. | |
In order to properly reflect some categories of other income and other expenses, reclassifications of expense and income items have been made to prior period numbers. The “net” other income and other expenses was not changed due to these reclassifications. | |
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Material estimates that are particularly susceptible to significant change in the near term relate to the determination of the allowance for loan losses, and the valuation of deferred tax assets, mortgage servicing rights and other real estate held for sale. | |
Allowance for Loan Losses | |
The allowance for loan losses includes specific allowances related to commercial loans, when they have been judged to be impaired. A loan is impaired when, based on current information, it is probable that the Corporation will not collect all amounts due in accordance with the contractual terms of the loan agreement. These specific allowances are based on discounted cash flows of expected future payments using the loan’s initial effective interest rate or the fair value of the collateral if the loan is collateral dependent. | |
The Corporation continues to maintain a general allowance for loan losses for loans not considered impaired. The allowance for loan losses is maintained at a level which management believes is adequate to provide for possible loan losses. Management periodically evaluates the adequacy of the allowance using the Corporation’s past loan loss experience, known and inherent risks in the portfolio, composition of the portfolio, current economic conditions, and other factors. The allowance does not include the effects of expected losses related to future events or future changes in economic conditions. This evaluation is inherently subjective since it requires material estimates that may be susceptible to significant change. Loans are charged against the allowance for loan losses when management believes the collectability of the principal is unlikely. In addition, various regulatory agencies periodically review the allowance for loan losses. These agencies may require additions to the allowance for loan losses based on their judgments of collectability. | |
In management’s opinion, the allowance for loan losses is adequate to cover probable losses relating to specifically identified loans, as well as probable losses inherent in the balance of the loan portfolio as of the balance sheet date. | |
Stock Compensation Plans | |
On May 22, 2012, the Company’s shareholders approved the Mackinac Financial Corporation 2012 Incentive Compensation Plan, under which current and prospective employees, non-employee directors and consultants may be awarded incentive stock options, non-statutory stock options, shares of restricted stock units (“RSUs”), or stock appreciation rights. The aggregate number of shares of the Company’s common stock issuable under the plan is 575,000, which included 392,152 option shares outstanding at that time. Awards are made at the discretion of management. Compensation cost equal to the fair value of the award is recognized over the vesting period. | |
The Corporation, in August 2012 and March 2014, granted Restricted Stock Units (“RSUs”) to members of the Board of Directors and Management. In August 2012, 148,500 RSUs were granted at a market value of $7.91 and will vest equally over a four year term. In exchange for the grant of these RSUs various previously issued stock option awards were surrendered. In March 2014, 52,774 RSUs were granted at a market value of $12.95, also vesting equally over a four year term. The RSUs were awarded at no cost to the employee. Compensation cost to be recognized over the four —year vesting periods, is $1.175 million and $.683 million, respectively. On August 31, 2013, the Corporation issued 37,125 shares of its common stock for vested RSUs. As of September 30, 2014, RSUs totaling 127,024 were unvested and unrecognized compensation expense was $1.154 million. | |
RECENT_ACCOUNTING_PRONOUNCEMEN
RECENT ACCOUNTING PRONOUNCEMENTS | 9 Months Ended |
Sep. 30, 2014 | |
RECENT ACCOUNTING PRONOUNCEMENTS | ' |
RECENT ACCOUNTING PRONOUNCEMENTS | ' |
2.RECENT ACCOUNTING PRONOUNCEMENTS | |
In May 2014, the Financial Accounting Standards Board (FASB) issued guidance on the recognition of revenue from contracts with customers. Revenue recognition will depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The guidance also requires disclosures regarding the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. The guidance permits two methods of adoption: retrospectively to each prior reporting period presented or retrospectively with the cumulative effect of initially applying the guidance recognized at the date of initial application. The guidance is effective January 1, 2017 and early adoption is not permitted. The company is currently evaluating the impact of the new guidance and the method of adoption in the consolidated financial results. | |
EARNINGS_PER_SHARE
EARNINGS PER SHARE | 9 Months Ended | |||||||||||||
Sep. 30, 2014 | ||||||||||||||
EARNINGS PER SHARE | ' | |||||||||||||
EARNINGS PER SHARE | ' | |||||||||||||
3.EARNINGS PER SHARE | ||||||||||||||
Diluted earnings per share, which reflects the potential dilution that could occur if outstanding stock options were exercised and stock awards were fully vested and resulted in the issuance of common stock that then shared in our earnings, is computed by dividing net income by the weighted average number of common shares outstanding and common stock equivalents, after giving effect for dilutive shares issued. | ||||||||||||||
The following shows the computation of basic and diluted earnings per share for the three and nine months ended September 30, 2014 and 2013 (dollars in thousands, except per share data): | ||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||
(Numerator): | ||||||||||||||
Net income | $ | 886 | $ | 896 | $ | 2,352 | $ | 2,969 | ||||||
Preferred stock dividends and accretion of discount | — | 50 | — | 250 | ||||||||||
Net income available to common shareholders | $ | 886 | $ | 846 | $ | 2,352 | $ | 2,719 | ||||||
(Denominator): | ||||||||||||||
Weighted average shares outstanding - basic | 5,540,200 | 5,562,835 | 5,532,966 | 5,559,108 | ||||||||||
Effect of dilutive stock options and vesting of restricted stock awards | 71,722 | — | 70,268 | — | ||||||||||
Weighted average shares outstanding - diluted | 5,611,922 | 5,562,835 | 5,603,234 | 5,559,108 | ||||||||||
Income per common share | ||||||||||||||
Basic | $ | 0.16 | $ | 0.15 | $ | 0.43 | $ | 0.49 | ||||||
Diluted | $ | 0.16 | $ | 0.15 | $ | 0.42 | $ | 0.49 | ||||||
INVESTMENT_SECURITIES
INVESTMENT SECURITIES | 9 Months Ended | |||||||||||||
Sep. 30, 2014 | ||||||||||||||
INVESTMENT SECURITIES | ' | |||||||||||||
INVESTMENT SECURITIES | ' | |||||||||||||
4. INVESTMENT SECURITIES | ||||||||||||||
The amortized cost and estimated fair value of investment securities available for sale as of September 30, 2014, December 31, 2013 and September 30, 2013 are as follows (dollars in thousands): | ||||||||||||||
Gross | Gross | |||||||||||||
Amortized | Unrealized | Unrealized | Estimated | |||||||||||
Cost | Gains | Losses | Fair Value | |||||||||||
September 30, 2014 | ||||||||||||||
US Agencies - MBS | $ | 6,142 | $ | 241 | $ | — | $ | 6,383 | ||||||
US Agencies | 22,725 | 41 | -273 | 22,493 | ||||||||||
Corporate Bonds | 12,621 | 172 | — | 12,793 | ||||||||||
Obligations of states and political subdivisions | 6,383 | 439 | — | 6,822 | ||||||||||
Other | 251 | — | — | 251 | ||||||||||
Total securities available for sale | $ | 48,122 | $ | 893 | $ | -273 | $ | 48,742 | ||||||
December 31, 2013 | ||||||||||||||
US Agencies - MBS | $ | 7,078 | $ | 281 | $ | — | $ | 7,359 | ||||||
US Agencies | 15,227 | — | -372 | 14,855 | ||||||||||
Corporate Bonds | 15,862 | 218 | -1 | 16,079 | ||||||||||
Obligations of states and political subdivisions | 5,893 | 202 | — | 6,095 | ||||||||||
Total securities available for sale | $ | 44,060 | $ | 701 | $ | -373 | $ | 44,388 | ||||||
September 30, 2013 | ||||||||||||||
US Agencies - MBS | $ | 7,236 | $ | 315 | $ | — | $ | 7,551 | ||||||
US Agencies | 16,003 | 66 | -336 | 15,733 | ||||||||||
Corporate Bonds | 18,451 | 192 | -4 | 18,639 | ||||||||||
Obligations of states and political subdivisions | 5,876 | 297 | — | 6,173 | ||||||||||
Total securities available for sale | $ | 47,566 | $ | 870 | $ | -340 | $ | 48,096 | ||||||
The Corporation has evaluated gross unrealized losses that exist within the portfolio and considers them temporary in nature. The Corporation has both the ability and the intent to hold the investment securities until their respective maturities and therefore does not anticipate the realization of the temporary losses. | ||||||||||||||
The amortized cost and estimated fair value of investment securities pledged to secure FHLB borrowings and customer relationships were $4.167 million and $4.300 million, respectively, at September 30, 2014. | ||||||||||||||
LOANS
LOANS | 9 Months Ended | ||||||||||||||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||||||||||||||
LOANS | ' | ||||||||||||||||||||||||||||
LOANS | ' | ||||||||||||||||||||||||||||
5. LOANS | |||||||||||||||||||||||||||||
The composition of loans is as follows (dollars in thousands): | |||||||||||||||||||||||||||||
September 30, | December 31, | September 30, | |||||||||||||||||||||||||||
2014 | 2013 | 2013 | |||||||||||||||||||||||||||
Commercial real estate | $ | 272,803 | $ | 268,809 | $ | 257,961 | |||||||||||||||||||||||
Commercial, financial, and agricultural | 98,714 | 79,655 | 79,511 | ||||||||||||||||||||||||||
One to four family residential real estate | 110,310 | 103,768 | 98,770 | ||||||||||||||||||||||||||
Construction : | |||||||||||||||||||||||||||||
Consumer | 8,729 | 6,895 | 5,734 | ||||||||||||||||||||||||||
Commerical | 12,242 | 10,904 | 16,054 | ||||||||||||||||||||||||||
Consumer | 15,575 | 13,801 | 14,465 | ||||||||||||||||||||||||||
Total loans | $ | 518,373 | $ | 483,832 | $ | 472,495 | |||||||||||||||||||||||
An analysis of the allowance for loan losses for nine months ended September 30, 2014, the year ended December 31, 2013 and the nine months ended September 30, 2013 is as follows (dollars in thousands): | |||||||||||||||||||||||||||||
September 30, | December 31, | September 30, | |||||||||||||||||||||||||||
2014 | 2013 | 2013 | |||||||||||||||||||||||||||
Balance at beginning of period | $ | 4,661 | $ | 5,218 | $ | 5,218 | |||||||||||||||||||||||
Loans charged off | (185 | ) | (2,432 | ) | (1,263 | ) | |||||||||||||||||||||||
Recoveries on loans previously charged off | 242 | 200 | 154 | ||||||||||||||||||||||||||
Provision | 561 | 1,675 | 850 | ||||||||||||||||||||||||||
Balance at end of period | $ | 5,279 | $ | 4,661 | $ | 4,959 | |||||||||||||||||||||||
In the first nine months of 2014, net recoveries were $.057 million compared to net charge-offs of $1.109 million, or .32% of average loans, in the same period in 2013. In the first nine months of 2014, the Corporation recorded a provision for loan loss of $.561 million compared to $.850 million in the first nine months of 2013. The Corporation’s allowance for loan loss reserve policy calls for a measurement of the adequacy of the reserve at each quarter end. This process includes an analysis of the loan portfolio to take into account increases in loans outstanding and portfolio composition, historical loss rates, and specific reserve requirements of nonperforming loans. | |||||||||||||||||||||||||||||
A breakdown of the allowance for loan losses and recorded balances in loans at September 30, 2014 is as follows (dollars in thousands): | |||||||||||||||||||||||||||||
Commercial, | One to four | ||||||||||||||||||||||||||||
Commercial | financial and | Commercial | family residential | Consumer | |||||||||||||||||||||||||
real estate | agricultural | construction | real estate | construction | Consumer | Unallocated | Total | ||||||||||||||||||||||
Three Months Ended September 30, 2014 | |||||||||||||||||||||||||||||
Allowance for loan loss reserve: | |||||||||||||||||||||||||||||
Beginning balance ALLR | $ | 1,630 | $ | 1,669 | $ | 40 | $ | 345 | $ | 15 | $ | 111 | $ | 1,287 | $ | 5,097 | |||||||||||||
Charge-offs | -18 | -9 | — | -28 | — | -15 | — | -70 | |||||||||||||||||||||
Recoveries | 31 | 16 | 3 | 4 | — | 11 | — | 65 | |||||||||||||||||||||
Provision | -1 | -153 | 1 | 80 | 3 | 1 | 256 | 187 | |||||||||||||||||||||
Ending balance ALLR | $ | 1,642 | $ | 1,523 | $ | 44 | $ | 401 | $ | 18 | $ | 108 | $ | 1,543 | $ | 5,279 | |||||||||||||
Nine Months Ended September 30, 2014 | |||||||||||||||||||||||||||||
Allowance for loan loss reserve: | |||||||||||||||||||||||||||||
Beginning balance ALLR | $ | 1,849 | $ | 1,378 | $ | 80 | $ | 516 | $ | 25 | $ | 148 | $ | 665 | $ | 4,661 | |||||||||||||
Charge-offs | -19 | -74 | — | -44 | — | -48 | — | -185 | |||||||||||||||||||||
Recoveries | 105 | 75 | 9 | 18 | — | 35 | — | 242 | |||||||||||||||||||||
Provision | -293 | 144 | -45 | -89 | -7 | -27 | 878 | 561 | |||||||||||||||||||||
Ending balance ALLR | $ | 1,642 | $ | 1,523 | $ | 44 | $ | 401 | $ | 18 | $ | 108 | $ | 1,543 | $ | 5,279 | |||||||||||||
At September 30,2014 | |||||||||||||||||||||||||||||
Loans: | |||||||||||||||||||||||||||||
Ending balance | $ | 272,803 | $ | 98,714 | $ | 12,242 | $ | 110,310 | $ | 8,729 | $ | 15,575 | $ | — | $ | 518,373 | |||||||||||||
Ending balance ALLR | -1,642 | -1,523 | -44 | -401 | -18 | -108 | -1,543 | -5,279 | |||||||||||||||||||||
Net loans | $ | 271,161 | $ | 97,191 | $ | 12,198 | $ | 109,909 | $ | 8,711 | $ | 15,467 | $ | -1,543 | $ | 513,094 | |||||||||||||
Ending balance ALLR: | |||||||||||||||||||||||||||||
Individually evaluated | $ | 312 | $ | 1,104 | $ | — | $ | 167 | $ | — | $ | 32 | $ | — | $ | 1,615 | |||||||||||||
Collectively evaluated | 1,330 | 419 | 44 | 234 | 18 | 76 | 1,543 | 3,664 | |||||||||||||||||||||
Total | $ | 1,642 | $ | 1,523 | $ | 44 | $ | 401 | $ | 18 | $ | 108 | $ | 1,543 | $ | 5,279 | |||||||||||||
Ending balance Loans: | |||||||||||||||||||||||||||||
Individually evaluated | $ | 378 | $ | 1,730 | $ | — | $ | 1,202 | $ | — | $ | 61 | $ | — | $ | 3,371 | |||||||||||||
Collectively evaluated | 272,425 | 96,984 | 12,242 | 109,108 | 8,729 | 15,514 | — | 515,002 | |||||||||||||||||||||
Total | $ | 272,803 | $ | 98,714 | $ | 12,242 | $ | 110,310 | $ | 8,729 | $ | 15,575 | $ | — | $ | 518,373 | |||||||||||||
Impaired loans, by definition, are individually evaluated. | |||||||||||||||||||||||||||||
A breakdown of the allowance for loan losses and recorded balances in loans at December 31, 2013 is as follows (dollars in thousands): | |||||||||||||||||||||||||||||
Commercial, | One to four | ||||||||||||||||||||||||||||
Commercial | financial and | Commercial | family residential | Consumer | |||||||||||||||||||||||||
real estate | agricultural | construction | real estate | construction | Consumer | Unallocated | Total | ||||||||||||||||||||||
Allowance for loan loss reserve: | |||||||||||||||||||||||||||||
Beginning balance ALLR | $ | 3,267 | $ | 692 | $ | 125 | $ | 980 | $ | — | $ | — | $ | 154 | 5,218 | ||||||||||||||
Charge-offs | -1,539 | -632 | — | -141 | — | -120 | — | -2,432 | |||||||||||||||||||||
Recoveries | 92 | 56 | 2 | 26 | 2 | 22 | — | 200 | |||||||||||||||||||||
Provision | 29 | 1,262 | -47 | -349 | 23 | 246 | 511 | 1,675 | |||||||||||||||||||||
Ending balance ALLR | $ | 1,849 | $ | 1,378 | $ | 80 | $ | 516 | $ | 25 | $ | 148 | $ | 665 | $ | 4,661 | |||||||||||||
Loans: | |||||||||||||||||||||||||||||
Ending balance | $ | 268,809 | $ | 79,655 | $ | 10,904 | $ | 103,768 | $ | 6,895 | $ | 13,801 | $ | — | $ | 483,832 | |||||||||||||
Ending balance ALLR | -1,849 | -1,378 | -80 | -516 | -25 | -148 | -665 | -4,661 | |||||||||||||||||||||
Net loans | $ | 266,960 | $ | 78,277 | $ | 10,824 | $ | 103,252 | $ | 6,870 | $ | 13,653 | $ | -665 | $ | 479,171 | |||||||||||||
Ending balance ALLR: | |||||||||||||||||||||||||||||
Individually evaluated | $ | 99 | $ | 891 | $ | — | $ | 103 | $ | — | $ | 18 | $ | — | $ | 1,111 | |||||||||||||
Collectively evaluated | 1,750 | 487 | 80 | 413 | 25 | 130 | 665 | 3,550 | |||||||||||||||||||||
Total | $ | 1,849 | $ | 1,378 | $ | 80 | $ | 516 | $ | 25 | $ | 148 | $ | 665 | $ | 4,661 | |||||||||||||
Ending balance Loans: | |||||||||||||||||||||||||||||
Individually evaluated | $ | 649 | $ | 1,830 | $ | — | $ | 385 | $ | — | $ | 42 | $ | — | $ | 2,906 | |||||||||||||
Collectively evaluated | 268,160 | 77,825 | 10,904 | 103,383 | 6,895 | 13,759 | — | 480,926 | |||||||||||||||||||||
Total | $ | 268,809 | $ | 79,655 | $ | 10,904 | $ | 103,768 | $ | 6,895 | $ | 13,801 | $ | — | $ | 483,832 | |||||||||||||
Impaired loans, by definition, are individually evaluated | |||||||||||||||||||||||||||||
A breakdown of the allowance for loan losses and recorded balances in loans at September 30, 2013 is as follows (dollars in thousands): | |||||||||||||||||||||||||||||
Commercial, | One to four | ||||||||||||||||||||||||||||
Commercial | financial and | Commercial | family residential | Consumer | |||||||||||||||||||||||||
real estate | agricultural | construction | real estate | construction | Consumer | Unallocated | Total | ||||||||||||||||||||||
Three Months Ended September 30, 2013 | |||||||||||||||||||||||||||||
Allowance for loan loss reserve: | |||||||||||||||||||||||||||||
Beginning balance ALLR | $ | 2,661 | $ | 1,090 | $ | 97 | $ | 877 | $ | — | $ | 13 | $ | 439 | $ | 5,177 | |||||||||||||
Charge-offs | -132 | -476 | — | -25 | — | -14 | — | -647 | |||||||||||||||||||||
Recoveries | 23 | 20 | — | 6 | 1 | 4 | — | 54 | |||||||||||||||||||||
Provision | 3 | 522 | -16 | 44 | -1 | 15 | -192 | 375 | |||||||||||||||||||||
Ending balance ALLR | $ | 2,555 | $ | 1,156 | $ | 81 | $ | 902 | $ | — | $ | 18 | $ | 247 | $ | 4,959 | |||||||||||||
Nine Months Ended September 30, 2013 | |||||||||||||||||||||||||||||
Allowance for loan loss reserve: | |||||||||||||||||||||||||||||
Beginning balance ALLR | $ | 3,267 | $ | 692 | $ | 125 | $ | 980 | $ | — | $ | — | $ | 154 | $ | 5,218 | |||||||||||||
Charge-offs | -588 | -552 | — | -38 | — | -85 | — | -1,263 | |||||||||||||||||||||
Recoveries | 64 | 53 | 2 | 17 | 1 | 17 | — | 154 | |||||||||||||||||||||
Provision | -188 | 963 | -46 | -57 | -1 | 86 | 93 | 850 | |||||||||||||||||||||
Ending balance ALLR | $ | 2,555 | $ | 1,156 | $ | 81 | $ | 902 | $ | — | $ | 18 | $ | 247 | $ | 4,959 | |||||||||||||
At September 30,2013 | |||||||||||||||||||||||||||||
Loans: | |||||||||||||||||||||||||||||
Ending balance | $ | 257,961 | $ | 79,511 | $ | 16,054 | $ | 98,770 | $ | 5,734 | $ | 14,465 | $ | — | $ | 472,495 | |||||||||||||
Ending balance ALLR | -2,555 | -1,156 | -81 | -902 | — | -18 | -247 | -4,959 | |||||||||||||||||||||
Net loans | $ | 255,406 | $ | 78,355 | $ | 15,973 | $ | 97,868 | $ | 5,734 | $ | 14,447 | $ | -247 | $ | 467,536 | |||||||||||||
Ending balance ALLR: | |||||||||||||||||||||||||||||
Individually evaluated | $ | 1,407 | $ | 802 | $ | 6 | $ | 246 | $ | — | $ | 18 | $ | — | $ | 2,479 | |||||||||||||
Collectively evaluated | 1,148 | 354 | 75 | 656 | — | — | 247 | 2,480 | |||||||||||||||||||||
Total | $ | 2,555 | $ | 1,156 | $ | 81 | $ | 902 | $ | — | $ | 18 | $ | 247 | $ | 4,959 | |||||||||||||
Ending balance Loans: | |||||||||||||||||||||||||||||
Individually evaluated | $ | 13,475 | $ | 7,638 | $ | 798 | $ | 450 | $ | — | $ | 35 | $ | — | $ | 22,396 | |||||||||||||
Collectively evaluated | 244,486 | 71,873 | 15,256 | 98,320 | 5,734 | 14,430 | — | 450,099 | |||||||||||||||||||||
Total | $ | 257,961 | $ | 79,511 | $ | 16,054 | $ | 98,770 | $ | 5,734 | $ | 14,465 | $ | — | $ | 472,495 | |||||||||||||
Impaired loans, by definition, are individually evaluated. | |||||||||||||||||||||||||||||
As part of the management of the loan portfolio, risk ratings are assigned to all commercial loans. Through the loan review process, ratings are modified as believed to be appropriate to reflect changes in the credit. Our ability to manage credit risk depends in large part on our ability to properly identify and manage problem loans. | |||||||||||||||||||||||||||||
To do so, we operate a credit risk rating system under which our credit management personnel assign a credit risk rating to each loan at the time of origination and review loans on a regular basis to determine each loan’s credit risk rating on a scale of 1 through 8, with higher scores indicating higher risk. The credit risk rating structure used is shown below. | |||||||||||||||||||||||||||||
In the context of the credit risk rating structure, the term Classified is defined as a problem loan which may or may not be in a nonaccrual status, dependent upon current payment status and collectability. | |||||||||||||||||||||||||||||
Strong (1) | |||||||||||||||||||||||||||||
Borrower is not vulnerable to sudden economic or technological changes. They have “strong” balance sheets and are within an industry that is very typical for our markets or type of lending culture. Borrowers also have “strong” financial and cash flow performance and excellent collateral (low loan to value or readily available to liquidate collateral) in conjunction with an impeccable repayment history. | |||||||||||||||||||||||||||||
Good (2) | |||||||||||||||||||||||||||||
Borrower shows limited vulnerability to sudden economic change. These borrowers have “above average” financial and cash flow performance and a very good repayment history. The balance sheet of the company is also very good as compared to peer and the company is in an industry that is familiar to our markets or our type of lending. The collateral securing the deal is also very good in terms of its type, loan to value, etc. | |||||||||||||||||||||||||||||
Average (3) | |||||||||||||||||||||||||||||
Borrower is typically a well-seasoned business, however may be susceptible to unfavorable changes in the economy, and could be somewhat affected by seasonal factors. The borrowers within this category exhibit financial and cash flow performance that appear “average” to “slightly above average” when compared to peer standards and they show an adequate payment history. Collateral securing this type of credit is good, exhibiting above average loan to values, etc. | |||||||||||||||||||||||||||||
Acceptable/Acceptable Watch (4) | |||||||||||||||||||||||||||||
A borrower within this category exhibits financial and cash flow performance that appear adequate and satisfactory when compared to peer standards and they show a satisfactory payment history. The collateral securing the request is within supervisory limits and overall is acceptable. Borrowers rated acceptable could also be newer businesses that are typically susceptible to unfavorable changes in the economy, and more than likely could be affected by seasonal factors. | |||||||||||||||||||||||||||||
Special Mention (5) | |||||||||||||||||||||||||||||
The borrower may have potential weaknesses that deserve management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the asset or in the institution’s credit position at some future date. Special mention assets are not adversely classified and do not expose an institution to sufficient risk to warrant adverse classification. Examples of this type of credit include a start-up company fully based on projections, a documentation issue that needs to be corrected or a general market condition that the borrower is working through to get corrected. | |||||||||||||||||||||||||||||
Substandard (6) | |||||||||||||||||||||||||||||
Substandard loans are classified assets exhibiting a number of well-defined weaknesses that jeopardize normal repayment. The assets are no longer adequately protected due to declining net worth, lack of earning capacity, or insufficient collateral offering the distinct possibility of the loss of a portion of the loan principal. Loans classified as substandard clearly represent troubled and deteriorating credit situations requiring constant supervision. | |||||||||||||||||||||||||||||
Doubtful (7) | |||||||||||||||||||||||||||||
Loans in this category exhibit the same, if not more pronounced weaknesses used to describe the substandard credit. Loans are frozen with collection improbable. Such loans are not yet rated as Charge-off because certain actions may yet occur which would salvage the loan. | |||||||||||||||||||||||||||||
Charge-off/Loss (8) | |||||||||||||||||||||||||||||
Loans in this category are largely uncollectible and should be charged against the loan loss reserve immediately. | |||||||||||||||||||||||||||||
General Reserves: | |||||||||||||||||||||||||||||
For loans with a credit risk rating of 5 or better and any loans with a risk rating of 6 or 7 with no specific reserve, reserves are established based on the type of loan collateral, if any, and the assigned credit risk rating. Determination of the allowance is inherently subjective as it requires significant estimates, including the amounts and timing of expected future cash flows on impaired loans, estimated losses on pools of homogenous loans based on historical loss experience, and consideration of current environmental factors and economic trends, all of which may be susceptible to significant change. | |||||||||||||||||||||||||||||
Using a historical average loss by loan type as a base, each loan graded as higher risk is assigned a specific percentage. Within the commercial loan portfolio, the historical loss rates are used for specific industries such as hospitality, gaming, petroleum, and forestry. The residential real estate and consumer loan portfolios are assigned a loss percentage as a homogenous group. If, however, on an individual loan the projected loss based on collateral value and payment histories are in excess of the computed allowance, the allocation is increased for the higher anticipated loss. These computations provide the basis for the allowance for loan losses as recorded by the Corporation. | |||||||||||||||||||||||||||||
Commercial construction loans in the amount of $2.883 million, $2.951 million and $2.773 million for the periods ended September 30, 2014, December 31, 2013 and September 30, 2013, respectively did not receive a specific risk rating. These amounts represent loans made for land development and unimproved land purchases. Below is a breakdown of loans by risk category as of September 30, 2014 (dollars in thousands): | |||||||||||||||||||||||||||||
-1 | -2 | -3 | -4 | -5 | -6 | -7 | Rating | ||||||||||||||||||||||
Acceptable/ | |||||||||||||||||||||||||||||
Excellent | Good | Average | Acceptable Watch | Sp. Mention | Substandard | Doubtful | Unassigned | Total | |||||||||||||||||||||
Commercial real estate | $ | 1,741 | $ | 24,827 | $ | 116,621 | $ | 128,126 | $ | — | $ | 1,488 | $ | — | $ | — | $ | 272,803 | |||||||||||
Commercial, financial and agricultural | 1,736 | 4,472 | 34,547 | 53,311 | — | 4,648 | — | — | 98,714 | ||||||||||||||||||||
Commercial construction | — | 444 | 1,578 | 6,935 | — | 402 | — | 2,883 | 12,242 | ||||||||||||||||||||
One to four family residential real estate | — | 295 | 1,046 | 4,119 | 60 | — | — | 104,790 | 110,310 | ||||||||||||||||||||
Consumer construction | — | — | — | — | — | — | — | 8,729 | 8,729 | ||||||||||||||||||||
Consumer | — | — | 4 | 21 | — | — | — | 15,550 | 15,575 | ||||||||||||||||||||
Total loans | $ | 3,477 | $ | 30,038 | $ | 153,796 | $ | 192,512 | $ | 60 | $ | 6,538 | $ | — | $ | 131,952 | $ | 518,373 | |||||||||||
Below is a breakdown of loans by risk category as of December 31, 2013 (dollars in thousands): | |||||||||||||||||||||||||||||
-1 | -2 | -3 | -4 | -5 | -6 | -7 | Rating | ||||||||||||||||||||||
Acceptable/ | |||||||||||||||||||||||||||||
Excellent | Good | Average | Acceptable Watch | Sp. Mention | Substandard | Doubtful | Unassigned | Total | |||||||||||||||||||||
Commercial real estate | $ | 1,502 | $ | 23,310 | $ | 116,702 | $ | 125,010 | $ | — | $ | 2,285 | $ | — | $ | — | $ | 268,809 | |||||||||||
Commercial, financial and agricultural | 3,741 | 4,348 | 27,455 | 39,070 | — | 5,041 | — | — | 79,655 | ||||||||||||||||||||
Commercial construction | 30 | 479 | 2,702 | 4,340 | — | 402 | — | 2,951 | 10,904 | ||||||||||||||||||||
One-to-four family residential real estate | 251 | 3,074 | 1,275 | 4,482 | — | 710 | — | 93,976 | 103,768 | ||||||||||||||||||||
Consumer construction | — | — | — | — | — | — | — | 6,895 | 6,895 | ||||||||||||||||||||
Consumer | 10 | — | 37 | 43 | — | 30 | — | 13,681 | 13,801 | ||||||||||||||||||||
Total loans | $ | 5,534 | $ | 31,211 | $ | 148,171 | $ | 172,945 | $ | — | $ | 8,468 | $ | — | $ | 117,503 | $ | 483,832 | |||||||||||
Below is a breakdown of loans by risk category as of September 30, 2013 (dollars in thousands): | |||||||||||||||||||||||||||||
-1 | -2 | -3 | -4 | -5 | -6 | -7 | Rating | ||||||||||||||||||||||
Excellent | Good | Average | Acceptable | Sp. Mention | Substandard | Doubtful | Unassigned | Total | |||||||||||||||||||||
Commercial real estate | $ | 2,240 | $ | 23,675 | $ | 88,105 | $ | 123,373 | $ | 16,117 | $ | 4,451 | $ | — | $ | — | $ | 257,961 | |||||||||||
Commercial, financial and agricultural | 4,260 | 5,108 | 22,263 | 41,851 | 3,746 | 2,094 | 189 | — | 79,511 | ||||||||||||||||||||
Commercial construction | — | 676 | 5,283 | 6,167 | 753 | 402 | — | 2,773 | 16,054 | ||||||||||||||||||||
One to four family residential real estate | — | 1,951 | 2,186 | 4,522 | — | 6 | — | 90,105 | 98,770 | ||||||||||||||||||||
Consumer construction | — | — | — | — | — | — | — | 5,734 | 5,734 | ||||||||||||||||||||
Consumer | — | 102 | 34 | 632 | — | — | — | 13,697 | 14,465 | ||||||||||||||||||||
Total loans | $ | 6,500 | $ | 31,512 | $ | 117,871 | $ | 176,545 | $ | 20,616 | $ | 6,953 | $ | 189 | $ | 112,309 | $ | 472,495 | |||||||||||
Impaired Loans | |||||||||||||||||||||||||||||
Nonperforming loans are those which are contractually past due 90 days or more as to interest or principal payments, on nonaccrual status, or loans, the terms of which have been renegotiated to provide a reduction or deferral on interest or principal. There was no interest income recorded during impairment for the three and nine months ended September 30, 2014. There was no interest income recorded during impairment and that which would have been recognized was $.040 million for the three months ended September 30, 2014, and no interest income recorded during impairment and that which would have been recognized of $.093 million for the nine months ended September 30, 2014. | |||||||||||||||||||||||||||||
The accrual of interest on loans is discontinued when, in management’s opinion, the borrower may be unable to meet payment obligations as they become due, as well as when required by regulatory provisions. When interest accrual is discontinued, all unpaid accrued interest is reversed. Interest income is subsequently recognized only to the extent cash payments are received in excess of principal due. Loans are returned to accrual status when all the principal and interest amounts contractually due are brought current and future payments are reasonably assured. | |||||||||||||||||||||||||||||
Loans are considered impaired when, based on current information and events, it is probable the Corporation will be unable to collect all amounts due in accordance with the original contractual terms of the loan agreement, including scheduled principal and interest payments. Impairment is evaluated in total for smaller-balance loans of a similar nature and on an individual loans basis for other loans. If a loan is impaired, a specific valuation allowance is allocated, if necessary, so that the loan is reported net, at the present value of estimated future cash flows using the loan’s existing rate or at the fair value of collateral if repayment is expected solely from the collateral. Interest payments on impaired loans are typically applied to principal unless collectability of the principal amount is reasonably assured, in which case interest is recognized on a cash basis. Impaired loans, or portions thereof, are charged off when deemed uncollectible. | |||||||||||||||||||||||||||||
The following is a summary of impaired loans and their effect on interest income (dollars in thousands): | |||||||||||||||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||||||||
QTD | YTD | Interest Income | Interest Income | Interest Income | Interest Income | ||||||||||||||||||||||||
Nonaccrual | Accrual | Average | Average | Related | Recognized | on | Recognized | on | |||||||||||||||||||||
Basis | Basis | Investment | Investment | Valuation Reserve | During Impairment | Accrual Basis | During Impairment | Accrual Basis | |||||||||||||||||||||
September 30, 2014 | |||||||||||||||||||||||||||||
With no valuation reserve: | |||||||||||||||||||||||||||||
Commercial real estate | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | |||||||||||
Commercial, financial and agricultural | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||
Commercial construction | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||
One to four family residential real estate | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||
Consumer construction | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||
Consumer | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||
With a valuation reserve: | $ | — | |||||||||||||||||||||||||||
Commercial real estate | $ | 227 | $ | — | $ | 340 | $ | 427 | $ | 227 | $ | — | $ | 4 | — | $ | 20 | ||||||||||||
Commercial, financial and agricultural | 1,735 | — | 1,770 | 1,268 | 1,104 | — | 28 | — | 52 | ||||||||||||||||||||
Commercial construction | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||
One to four family residential real estate | 733 | — | 489 | 434 | 147 | — | 7 | — | 20 | ||||||||||||||||||||
Consumer construction | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||
Consumer | — | — | 11 | 14 | — | — | 1 | 1 | |||||||||||||||||||||
Total: | |||||||||||||||||||||||||||||
Commercial real estate | $ | 227 | $ | — | $ | 340 | $ | 427 | $ | 227 | $ | — | $ | 4 | $ | — | $ | 20 | |||||||||||
Commercial, financial and agricultural | 1,735 | — | 1,770 | 1,268 | 1,104 | — | 28 | — | 52 | ||||||||||||||||||||
Commercial construction | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||
One to four family residential real estate | 733 | — | 489 | 434 | 147 | — | 7 | — | 20 | ||||||||||||||||||||
Consumer construction | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||
Consumer | — | — | 11 | 14 | — | — | 1 | — | 1 | ||||||||||||||||||||
Total | $ | 2,695 | $ | — | $ | 2,610 | $ | 2,143 | $ | 1,478 | $ | — | $ | 40 | $ | — | $ | 93 | |||||||||||
Interest Income | Interest Income | ||||||||||||||||||||||||||||
For the Year Ended: | Nonaccrual | Accrual | Average | Related | Recognized | on | |||||||||||||||||||||||
December 31, 2013 | Basis | Basis | Investment | Valuation Reserve | During Impairment | Accrual Basis | |||||||||||||||||||||||
With no valuation reserve: | |||||||||||||||||||||||||||||
Commercial real estate | $ | 513 | $ | — | $ | 3,045 | $ | — | $ | — | $ | 153 | |||||||||||||||||
Commercial, financial and agricultural | 59 | — | 505 | — | — | 13 | |||||||||||||||||||||||
Commercial construction | — | — | 626 | — | — | 3 | |||||||||||||||||||||||
One to four family residential real estate | 361 | — | 625 | — | — | 16 | |||||||||||||||||||||||
Consumer construction | — | — | — | — | — | — | |||||||||||||||||||||||
Consumer | — | — | 2 | — | — | — | |||||||||||||||||||||||
With a valuation reserve: | |||||||||||||||||||||||||||||
Commercial real estate | $ | 59 | $ | — | $ | 71 | $ | 14 | $ | — | $ | 5 | |||||||||||||||||
Commercial, financial and agricultural | 752 | — | 834 | 265 | — | 18 | |||||||||||||||||||||||
Commercial construction | — | — | — | — | — | — | |||||||||||||||||||||||
One to four family residential real estate | 250 | — | 261 | 78 | — | 20 | |||||||||||||||||||||||
Consumer construction | — | — | — | — | — | — | |||||||||||||||||||||||
Consumer | 30 | — | 30 | 13 | — | — | |||||||||||||||||||||||
Total: | |||||||||||||||||||||||||||||
Commercial real estate | $ | 572 | $ | — | $ | 3,116 | $ | 14 | $ | — | $ | 158 | |||||||||||||||||
Commercial, financial and agricultural | 811 | — | 1,339 | 265 | — | 31 | |||||||||||||||||||||||
Commercial construction | — | — | 626 | — | — | 3 | |||||||||||||||||||||||
One to four family residential real estate | 611 | — | 886 | 78 | — | 36 | |||||||||||||||||||||||
Consumer construction | — | — | — | — | — | — | |||||||||||||||||||||||
Consumer | 30 | — | 32 | 13 | — | — | |||||||||||||||||||||||
Total | $ | 2,024 | $ | — | $ | 5,999 | $ | 370 | $ | — | $ | 228 | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||||||||
QTD | YTD | Interest Income | Interest Income | Interest Income | Interest Income | ||||||||||||||||||||||||
Nonaccrual | Accrual | Average | Average | Related | Recognized | on | Recognized | on | |||||||||||||||||||||
Basis | Basis | Investment | Investment | Valuation Reserve | During Impairment | Accrual Basis | During Impairment | Accrual Basis | |||||||||||||||||||||
September 30, 2013 | |||||||||||||||||||||||||||||
With no valuation reserve: | |||||||||||||||||||||||||||||
Commercial real estate | $ | 238 | $ | — | $ | 412 | $ | 501 | $ | — | $ | — | $ | — | $ | — | $ | 26 | |||||||||||
Commercial, financial and agricultural | — | — | 147 | 243 | — | — | 3 | — | 9 | ||||||||||||||||||||
Commercial construction | — | — | — | 193 | — | — | — | — | 3 | ||||||||||||||||||||
One to four family residential real estate | 67 | — | 86 | 140 | — | — | 2 | — | 7 | ||||||||||||||||||||
Consumer construction | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||
Consumer | 10 | — | 9 | 4 | — | — | — | — | — | ||||||||||||||||||||
With a valuation reserve: | |||||||||||||||||||||||||||||
Commercial real estate | $ | 2,589 | $ | — | $ | 2,581 | $ | 2,557 | $ | 1,272 | $ | — | $ | 42 | $ | — | $ | 102 | |||||||||||
Commercial, financial and agricultural | 767 | — | 741 | 373 | 33 | — | 5 | — | 11 | ||||||||||||||||||||
Commercial construction | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||
One to four family residential real estate | 642 | — | 560 | 396 | 250 | — | 8 | — | 19 | ||||||||||||||||||||
Consumer construction | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||
Consumer | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||
Total: | |||||||||||||||||||||||||||||
Commercial real estate | $ | 2,827 | $ | — | $ | 2,993 | $ | 3,058 | $ | 1,272 | $ | — | $ | 42 | $ | — | $ | 128 | |||||||||||
Commercial, financial and agricultural | 767 | — | 888 | 616 | 33 | — | 8 | — | 20 | ||||||||||||||||||||
Commercial construction | — | — | — | 193 | — | — | — | — | 3 | ||||||||||||||||||||
One to four family residential real estate | 709 | — | 646 | 536 | 250 | — | 10 | — | 26 | ||||||||||||||||||||
Consumer construction | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||
Consumer | 10 | — | 9 | 4 | — | — | — | — | — | ||||||||||||||||||||
Total | $ | 4,313 | $ | — | $ | 4,536 | $ | 4,407 | $ | 1,555 | $ | — | $ | 60 | $ | — | $ | 177 | |||||||||||
A summary of past due loans at September 30, 2014, December 31, 2013 and September 30, 2013 is as follows (dollars in thousands): | |||||||||||||||||||||||||||||
September 30, | December 31, | September 30, | |||||||||||||||||||||||||||
2014 | 2013 | 2013 | |||||||||||||||||||||||||||
30-89 days | 90+ days | 30-89 days | 90+ days | 30-89 days | 90+ days | ||||||||||||||||||||||||
Past Due | Past Due/ | Past Due | Past Due/ | Past Due | Past Due/ | ||||||||||||||||||||||||
(accruing) | Nonaccrual | Total | (accruing) | Nonaccrual | Total | (accruing) | Nonaccrual | Total | |||||||||||||||||||||
Commercial real estate | $ | 540 | $ | 227 | $ | 767 | $ | — | $ | 572 | $ | 572 | $ | — | $ | 2,827 | $ | 2,827 | |||||||||||
Commercial, financial and agricultural | 306 | 1,735 | 2,041 | 4 | 811 | 815 | 100 | 767 | 867 | ||||||||||||||||||||
Commercial construction | 55 | — | 55 | 20 | — | 20 | — | — | — | ||||||||||||||||||||
One to four family residential real estate | 414 | 733 | 1,147 | 201 | 611 | 812 | 186 | 709 | 895 | ||||||||||||||||||||
Consumer construction | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||
Consumer | 55 | — | 55 | 14 | 30 | 44 | 31 | 10 | 41 | ||||||||||||||||||||
Total past due loans | $ | 1,370 | $ | 2,695 | $ | 4,065 | $ | 239 | $ | 2,024 | $ | 2,263 | $ | 317 | $ | 4,313 | $ | 4,630 | |||||||||||
A roll-forward of nonaccrual activity for the three months ended September 30, 2014 (dollars in thousands): | |||||||||||||||||||||||||||||
For the Three Months Ended September 30, 2014 | |||||||||||||||||||||||||||||
Commercial, | One to four | ||||||||||||||||||||||||||||
Commercial | Financial and | Commercial | family residential | Consumer | |||||||||||||||||||||||||
Real Estate | Agricultural | Construction | real estate | Construction | Consumer | Total | |||||||||||||||||||||||
NONACCRUAL | |||||||||||||||||||||||||||||
Beginning balance | $ | 454 | $ | 1,808 | $ | — | $ | 383 | $ | — | $ | 7 | $ | 2,652 | |||||||||||||||
Principal payments | -2 | -79 | — | -7 | — | — | -88 | ||||||||||||||||||||||
Charge-offs | -18 | -3 | — | -10 | — | -7 | -38 | ||||||||||||||||||||||
Advances | — | — | — | — | — | — | — | ||||||||||||||||||||||
Class transfers | — | — | — | — | — | — | — | ||||||||||||||||||||||
Transfers to OREO | -207 | — | — | — | — | — | -207 | ||||||||||||||||||||||
Transfers to accruing | — | — | — | — | — | — | — | ||||||||||||||||||||||
Transfers from accruing | — | 3 | — | 368 | — | — | 371 | ||||||||||||||||||||||
Other | — | 6 | — | -1 | — | — | 5 | ||||||||||||||||||||||
Ending balance | $ | 227 | $ | 1,735 | $ | — | $ | 733 | $ | — | $ | — | $ | 2,695 | |||||||||||||||
A roll-forward of nonaccrual activity for the three months ended September 30, 2013 (dollars in thousands): | |||||||||||||||||||||||||||||
For the Three Months Ended September 30, 2013 | |||||||||||||||||||||||||||||
Commercial, | One to four | ||||||||||||||||||||||||||||
Commercial | Financial and | Commercial | family residential | Consumer | |||||||||||||||||||||||||
Real Estate | Agricultural | Construction | real estate | Construction | Consumer | Total | |||||||||||||||||||||||
NONACCRUAL | |||||||||||||||||||||||||||||
Beginning balance | $ | 3,057 | $ | 517 | $ | — | $ | 400 | $ | — | $ | 9 | $ | 3,983 | |||||||||||||||
Principal payments | -26 | -224 | — | -12 | — | -1 | -263 | ||||||||||||||||||||||
Charge-offs | -23 | -476 | — | -24 | — | — | -523 | ||||||||||||||||||||||
Advances | — | — | — | — | — | — | — | ||||||||||||||||||||||
Class transfers | — | — | — | — | — | — | — | ||||||||||||||||||||||
Transfers to OREO | -208 | -37 | — | — | — | — | -245 | ||||||||||||||||||||||
Transfers to accruing | — | — | — | — | — | — | — | ||||||||||||||||||||||
Transfers from accruing | — | 966 | — | 344 | — | 2 | 1,312 | ||||||||||||||||||||||
Other | 27 | 21 | — | 1 | 49 | ||||||||||||||||||||||||
Ending balance | $ | 2,827 | $ | 767 | $ | — | $ | 709 | $ | — | $ | 10 | $ | 4,313 | |||||||||||||||
A roll-forward of nonaccrual activity for the nine months ended September 30, 2014 (dollars in thousands): | |||||||||||||||||||||||||||||
For the Nine Months Ended September 30, 2014 | |||||||||||||||||||||||||||||
Commercial, | One to four | ||||||||||||||||||||||||||||
Commercial | Financial and | Commercial | family residential | Consumer | |||||||||||||||||||||||||
Real Estate | Agricultural | Construction | real estate | Construction | Consumer | Total | |||||||||||||||||||||||
NONACCRUAL | |||||||||||||||||||||||||||||
Beginning balance | $ | 572 | $ | 811 | $ | — | $ | 611 | $ | — | $ | 30 | $ | 2,024 | |||||||||||||||
Principal payments | -104 | -160 | — | -29 | — | -4 | -297 | ||||||||||||||||||||||
Charge-offs | -18 | -56 | — | -13 | — | -32 | -119 | ||||||||||||||||||||||
Advances | — | — | — | — | — | — | — | ||||||||||||||||||||||
Class transfers | — | — | — | — | — | — | — | ||||||||||||||||||||||
Transfers to OREO | -233 | — | — | -257 | — | — | -490 | ||||||||||||||||||||||
Transfers to accruing | — | -10 | — | -127 | — | — | -137 | ||||||||||||||||||||||
Transfers from accruing | — | 1,142 | — | 539 | — | 6 | 1,687 | ||||||||||||||||||||||
Other | 10 | 8 | — | 9 | — | — | 27 | ||||||||||||||||||||||
Ending balance | $ | 227 | $ | 1,735 | $ | — | $ | 733 | $ | — | $ | — | $ | 2,695 | |||||||||||||||
A roll-forward of nonaccrual activity for the nine months ended September 30, 2013 (dollars in thousands): | |||||||||||||||||||||||||||||
For the Nine Months Ended September 30, 2013 | |||||||||||||||||||||||||||||
Commercial, | One to four | ||||||||||||||||||||||||||||
Commercial | Financial and | Commercial | family residential | Consumer | |||||||||||||||||||||||||
Real Estate | Agricultural | Construction | real estate | Construction | Consumer | Total | |||||||||||||||||||||||
NONACCRUAL | |||||||||||||||||||||||||||||
Beginning balance | $ | 3,071 | $ | 436 | $ | 675 | $ | 505 | $ | — | $ | — | $ | 4,687 | |||||||||||||||
Principal payments | (174 | ) | (292 | ) | (100 | ) | (77 | ) | — | (1 | ) | (644 | ) | ||||||||||||||||
Charge-offs | (352 | ) | (548 | ) | — | (37 | ) | — | (4 | ) | (941 | ) | |||||||||||||||||
Advances | — | — | — | — | — | — | — | ||||||||||||||||||||||
Class transfers | — | — | — | — | — | — | — | ||||||||||||||||||||||
Transfers to OREO | (208 | ) | (37 | ) | (580 | ) | (107 | ) | — | — | (932 | ) | |||||||||||||||||
Transfers to accruing | — | — | — | — | — | — | — | ||||||||||||||||||||||
Transfers from accruing | 443 | 1,207 | — | 420 | — | 15 | 2,085 | ||||||||||||||||||||||
Other | 47 | 1 | 5 | 5 | — | — | 58 | ||||||||||||||||||||||
Ending balance | $ | 2,827 | $ | 767 | $ | — | $ | 709 | $ | — | $ | 10 | $ | 4,313 | |||||||||||||||
A roll-forward of nonaccrual activity during the year ended December 31, 2013 (dollars in thousands): | |||||||||||||||||||||||||||||
Commercial, | One to four | ||||||||||||||||||||||||||||
Commercial | Financial and | Commercial | family residential | Consumer | |||||||||||||||||||||||||
Real Estate | Agricultural | Construction | real estate | Construction | Consumer | Total | |||||||||||||||||||||||
NONACCRUAL | |||||||||||||||||||||||||||||
Beginning balance | $ | 3,071 | $ | 436 | $ | 675 | $ | 505 | $ | — | $ | — | $ | 4,687 | |||||||||||||||
Principal payments | (1,478 | ) | (319 | ) | (100 | ) | (88 | ) | — | (2 | ) | (1,987 | ) | ||||||||||||||||
Charge-offs | (1,304 | ) | (616 | ) | — | (141 | ) | — | (4 | ) | (2,065 | ) | |||||||||||||||||
Advances | — | — | — | — | — | — | — | ||||||||||||||||||||||
Class transfers | — | — | — | — | — | — | — | ||||||||||||||||||||||
Transfers to OREO | (208 | ) | (37 | ) | (580 | ) | (107 | ) | — | — | (932 | ) | |||||||||||||||||
Transfers to accruing | — | — | — | — | — | — | — | ||||||||||||||||||||||
Transfers from accruing | 443 | 1,346 | — | 434 | — | 36 | 2,259 | ||||||||||||||||||||||
Other | 48 | 1 | 5 | 8 | — | — | 62 | ||||||||||||||||||||||
Ending balance | $ | 572 | $ | 811 | $ | — | $ | 611 | $ | — | $ | 30 | $ | 2,024 | |||||||||||||||
Troubled Debt Restructuring | |||||||||||||||||||||||||||||
Troubled debt restructurings (“TDR”) are determined on a loan-by-loan basis. Generally restructurings are related to interest rate reductions, loan term extensions and short term payment forbearance as means to maximize collectability of troubled credits. If a portion of the TDR loan is uncollectible (including forgiveness of principal), the uncollectible amount will be charged off against the allowance at the time of the restructuring. In general, a borrower must make at least six consecutive timely payments before the Corporation would consider a return of a restructured loan to accruing status in accordance with FDIC guidelines regarding restoration of credits to accrual status. | |||||||||||||||||||||||||||||
The Corporation has, in accordance with generally accepted accounting principles and per recently enacted accounting standard updates, evaluated all loan modifications to determine the fair value impact of the underlying asset. The carrying amount of the loan is compared to the expected payments to be received, discounted at the loan’s original rate, or for collateral dependent loans, to the fair value of the collateral. | |||||||||||||||||||||||||||||
A summary of troubled debt restructurings occurring during the periods indicated is as follows (dollars in thousands): | |||||||||||||||||||||||||||||
September 30, | December 31, | September 30, | |||||||||||||||||||||||||||
2014 | 2013 | 2013 | |||||||||||||||||||||||||||
Number of | Recorded | Number of | Recorded | Number of | Recorded | ||||||||||||||||||||||||
Modifications | Investment | Modifications | Investment | Modifications | Investment | ||||||||||||||||||||||||
Commercial real estate | — | $ | — | — | $ | — | — | $ | — | ||||||||||||||||||||
Commercial, financial and agricultural | — | — | 1 | 528 | 1 | 528 | |||||||||||||||||||||||
Commercial construction | — | — | — | — | — | — | |||||||||||||||||||||||
One to four family residential real estate | — | — | — | — | — | — | |||||||||||||||||||||||
Consumer construction | — | — | — | — | — | — | |||||||||||||||||||||||
Consumer | — | — | — | — | — | — | |||||||||||||||||||||||
Total troubled debt restructurings | — | $ | — | 1 | $ | 528 | 1 | $ | 528 | ||||||||||||||||||||
A roll-forward of troubled debt restructuring during the three months ended September 30, 2014 (dollars in thousands): | |||||||||||||||||||||||||||||
Commercial, | One to four | Consumer and | |||||||||||||||||||||||||||
Commercial | Financial and | Commercial | family residential | Consumer | |||||||||||||||||||||||||
Real Estate | Agricultural | Construction | real estate | Construction | Total | ||||||||||||||||||||||||
ACCRUING | |||||||||||||||||||||||||||||
Beginning balance | $ | 1,007 | $ | 1,186 | $ | 858 | $ | 98 | $ | — | $ | 3,149 | |||||||||||||||||
Principal payments | — | — | (3 | ) | (1 | ) | — | (4 | ) | ||||||||||||||||||||
Charge-offs | — | — | — | — | — | — | |||||||||||||||||||||||
Advances | — | — | — | — | — | — | |||||||||||||||||||||||
New restructured | — | — | — | — | — | — | |||||||||||||||||||||||
Transferred out of TDR | — | — | — | — | — | — | |||||||||||||||||||||||
Transfers to nonaccrual | — | — | — | — | — | — | |||||||||||||||||||||||
Ending Balance | $ | 1,007 | $ | 1,186 | $ | 855 | $ | 97 | $ | — | $ | 3,145 | |||||||||||||||||
NONACCRUAL | |||||||||||||||||||||||||||||
Beginning balance | $ | — | $ | 508 | $ | — | $ | 89 | $ | — | $ | 597 | |||||||||||||||||
Principal payments | — | — | — | — | — | — | |||||||||||||||||||||||
Charge-offs | — | — | — | — | — | — | |||||||||||||||||||||||
Advances | — | — | — | — | — | — | |||||||||||||||||||||||
New restructured | — | — | — | — | — | — | |||||||||||||||||||||||
Transfers to foreclosed properties | — | — | — | — | — | — | |||||||||||||||||||||||
Transfers from accruing | — | — | — | — | — | — | |||||||||||||||||||||||
Ending Balance | $ | — | $ | 508 | $ | — | $ | 89 | $ | — | $ | 597 | |||||||||||||||||
TOTALS | |||||||||||||||||||||||||||||
Beginning balance | $ | 1,007 | $ | 1,694 | $ | 858 | $ | 187 | $ | — | $ | 3,746 | |||||||||||||||||
Principal payments | — | — | (3 | ) | (1 | ) | — | (4 | ) | ||||||||||||||||||||
Charge-offs | — | — | — | — | — | — | |||||||||||||||||||||||
Advances | — | — | — | — | — | — | |||||||||||||||||||||||
New restructured | — | — | — | — | — | — | |||||||||||||||||||||||
Transfers out of TDRs | — | — | — | — | — | — | |||||||||||||||||||||||
Tansfers to nonaccrual | — | — | — | — | — | — | |||||||||||||||||||||||
Transfers to foreclosed properties | — | — | — | — | — | — | |||||||||||||||||||||||
Transfers from accruing | — | — | — | — | — | — | |||||||||||||||||||||||
Ending Balance | $ | 1,007 | $ | 1,694 | $ | 855 | $ | 186 | $ | — | $ | 3,742 | |||||||||||||||||
A roll-forward of troubled debt restructuring during the three months ended September 30, 2013 (dollars in thousands): | |||||||||||||||||||||||||||||
Commercial, | One to four | Consumer and | |||||||||||||||||||||||||||
Commercial | Financial and | Commercial | family residential | Consumer | |||||||||||||||||||||||||
Real Estate | Agricultural | Construction | real estate | Construction | Total | ||||||||||||||||||||||||
ACCRUING | |||||||||||||||||||||||||||||
Beginning balance | $ | 3,563 | $ | 2,174 | $ | 858 | $ | 100 | $ | — | $ | 6,695 | |||||||||||||||||
Principal payments | (20 | ) | (25 | ) | — | (1 | ) | (46 | ) | ||||||||||||||||||||
Charge-offs | — | (400 | ) | — | — | — | (400 | ) | |||||||||||||||||||||
Advances | — | — | — | — | — | — | |||||||||||||||||||||||
New restructured | — | — | — | — | — | — | |||||||||||||||||||||||
Transferred out of TDR | — | — | — | — | — | — | |||||||||||||||||||||||
Transfers to nonaccrual | — | (528 | ) | — | — | — | (528 | ) | |||||||||||||||||||||
Ending Balance | $ | 3,543 | $ | 1,221 | $ | 858 | $ | 99 | $ | — | $ | 5,721 | |||||||||||||||||
NONACCRUAL | |||||||||||||||||||||||||||||
Beginning balance | $ | 2,169 | $ | — | $ | — | $ | 106 | $ | — | $ | 2,275 | |||||||||||||||||
Principal payments | (87 | ) | — | — | (14 | ) | — | (101 | ) | ||||||||||||||||||||
Charge-offs | — | — | — | — | — | — | |||||||||||||||||||||||
Advances | — | — | — | — | — | — | |||||||||||||||||||||||
New restructured | — | — | — | — | — | — | |||||||||||||||||||||||
Transfers to foreclosed properties | — | — | — | — | — | — | |||||||||||||||||||||||
Transfers from accruing | — | 528 | — | — | — | 528 | |||||||||||||||||||||||
Ending Balance | $ | 2,082 | $ | 528 | $ | — | $ | 92 | $ | — | $ | 2,702 | |||||||||||||||||
TOTALS | |||||||||||||||||||||||||||||
Beginning balance | $ | 5,732 | $ | 2,174 | $ | 858 | $ | 206 | $ | — | $ | 8,970 | |||||||||||||||||
Principal payments | (107 | ) | (25 | ) | — | (15 | ) | — | (147 | ) | |||||||||||||||||||
Charge-offs | — | (400 | ) | — | — | — | (400 | ) | |||||||||||||||||||||
Advances | — | — | — | — | — | — | |||||||||||||||||||||||
New restructured | — | — | — | — | — | — | |||||||||||||||||||||||
Transfers out of TDRs | — | — | — | — | — | — | |||||||||||||||||||||||
Tansfers to nonaccrual | — | (528 | ) | — | — | — | (528 | ) | |||||||||||||||||||||
Transfers to foreclosed properties | — | — | — | — | — | — | |||||||||||||||||||||||
Transfers from accruing | — | 528 | — | — | — | 528 | |||||||||||||||||||||||
Ending Balance | $ | 5,625 | $ | 1,749 | $ | 858 | $ | 191 | $ | — | $ | 8,423 | |||||||||||||||||
A roll-forward of troubled debt restructuring during the nine months ended September 30, 2014 (dollars in thousands): | |||||||||||||||||||||||||||||
Commercial, | One to four | Consumer and | |||||||||||||||||||||||||||
Commercial | Financial and | Commercial | family residential | Consumer | |||||||||||||||||||||||||
Real Estate | Agricultural | Construction | real estate | Construction | Total | ||||||||||||||||||||||||
ACCRUING | |||||||||||||||||||||||||||||
Beginning balance | $ | 3,520 | $ | 1,186 | $ | 858 | $ | 99 | $ | — | $ | 5,663 | |||||||||||||||||
Principal payments | (2,513 | ) | — | (3 | ) | (4 | ) | — | (2,520 | ) | |||||||||||||||||||
Charge-offs | — | — | — | — | — | — | |||||||||||||||||||||||
Advances | — | — | — | — | — | — | |||||||||||||||||||||||
New restructured | — | — | — | — | — | — | |||||||||||||||||||||||
Transferred out of TDRs | — | — | — | 91 | — | 91 | |||||||||||||||||||||||
Transfers to nonaccrual | — | — | — | (89 | ) | — | (89 | ) | |||||||||||||||||||||
Ending Balance | $ | 1,007 | $ | 1,186 | $ | 855 | $ | 97 | $ | — | $ | 3,145 | |||||||||||||||||
NONACCRUAL | |||||||||||||||||||||||||||||
Beginning balance | $ | — | $ | 523 | $ | — | $ | 91 | $ | — | $ | 614 | |||||||||||||||||
Principal payments | — | (15 | ) | — | — | — | (15 | ) | |||||||||||||||||||||
Charge-offs | — | — | — | — | — | — | |||||||||||||||||||||||
Advances | — | — | — | — | — | — | |||||||||||||||||||||||
New restructured | — | — | — | — | — | — | |||||||||||||||||||||||
Transfers to foreclosed properties | — | — | — | (91 | ) | — | (91 | ) | |||||||||||||||||||||
Transfers from accruing | — | — | — | 89 | — | 89 | |||||||||||||||||||||||
Ending Balance | $ | — | $ | 508 | $ | — | $ | 89 | $ | — | $ | 597 | |||||||||||||||||
TOTALS | |||||||||||||||||||||||||||||
Beginning balance | $ | 3,520 | $ | 1,709 | $ | 858 | $ | 190 | $ | — | $ | 6,277 | |||||||||||||||||
Principal payments | (2,513 | ) | (15 | ) | (3 | ) | (4 | ) | — | (2,535 | ) | ||||||||||||||||||
Charge-offs | — | — | — | — | — | — | |||||||||||||||||||||||
Advances | — | — | — | — | — | — | |||||||||||||||||||||||
New restructured | — | — | — | — | — | — | |||||||||||||||||||||||
Transfers out of TDR | — | — | — | 91 | — | 91 | |||||||||||||||||||||||
Transfers to nonaccrual | — | — | — | (89 | ) | — | (89 | ) | |||||||||||||||||||||
Transfers to foreclosed properties | — | — | — | 89 | — | 89 | |||||||||||||||||||||||
Transfer from accruing | — | — | — | (91 | ) | — | (91 | ) | |||||||||||||||||||||
Ending Balance | $ | 1,007 | $ | 1,694 | $ | 855 | $ | 186 | $ | — | $ | 3,742 | |||||||||||||||||
A roll-forward of troubled debt restructuring during the nine months ended September 30, 2013 (dollars in thousands): | |||||||||||||||||||||||||||||
Commercial, | One to four | Consumer and | |||||||||||||||||||||||||||
Commercial | Financial and | Commercial | family residential | Consumer | |||||||||||||||||||||||||
Real Estate | Agricultural | Construction | real estate | Construction | Total | ||||||||||||||||||||||||
ACCRUING | |||||||||||||||||||||||||||||
Beginning balance | $ | 3,611 | $ | 1,221 | $ | 858 | $ | 102 | $ | — | $ | 5,792 | |||||||||||||||||
Principal payments | (68 | ) | (25 | ) | — | (3 | ) | — | (96 | ) | |||||||||||||||||||
Charge-offs | — | (400 | ) | — | — | — | (400 | ) | |||||||||||||||||||||
Advances | — | — | — | — | — | — | |||||||||||||||||||||||
New restructured | — | 953 | — | — | — | 953 | |||||||||||||||||||||||
Transferred out of TDRs | — | — | — | — | — | — | |||||||||||||||||||||||
Transfers to nonaccrual | — | (528 | ) | — | — | — | (528 | ) | |||||||||||||||||||||
Ending Balance | $ | 3,543 | $ | 1,221 | $ | 858 | $ | 99 | $ | — | $ | 5,721 | |||||||||||||||||
NONACCRUAL | |||||||||||||||||||||||||||||
Beginning balance | $ | 2,162 | $ | — | $ | — | $ | 102 | $ | — | $ | 2,264 | |||||||||||||||||
Principal payments | (87 | ) | — | — | (14 | ) | — | (101 | ) | ||||||||||||||||||||
Charge-offs | — | — | — | — | — | — | |||||||||||||||||||||||
Advances | — | — | — | — | — | — | |||||||||||||||||||||||
New restructured | 7 | — | — | 4 | — | 11 | |||||||||||||||||||||||
Transfers to foreclosed properties | — | — | — | — | — | — | |||||||||||||||||||||||
Transfers from accruing | — | 528 | — | — | — | 528 | |||||||||||||||||||||||
Ending Balance | $ | 2,082 | $ | 528 | $ | — | $ | 92 | $ | — | $ | 2,702 | |||||||||||||||||
TOTALS | |||||||||||||||||||||||||||||
Beginning balance | $ | 5,773 | $ | 1,221 | $ | 858 | $ | 204 | $ | — | $ | 8,056 | |||||||||||||||||
Principal payments | (155 | ) | (25 | ) | — | (17 | ) | — | (197 | ) | |||||||||||||||||||
Charge-offs | — | (400 | ) | — | — | — | (400 | ) | |||||||||||||||||||||
Advances | — | — | — | — | — | — | |||||||||||||||||||||||
New restructured | 7 | 953 | — | 4 | — | 964 | |||||||||||||||||||||||
Transfers out of TDR | — | — | — | — | — | — | |||||||||||||||||||||||
Transfers to nonaccrual | — | (528 | ) | — | — | — | (528 | ) | |||||||||||||||||||||
Transfers to foreclosed properties | — | 528 | — | — | — | 528 | |||||||||||||||||||||||
Transfer from accruing | — | — | — | — | — | — | |||||||||||||||||||||||
Ending Balance | $ | 5,625 | $ | 1,749 | $ | 858 | $ | 191 | $ | — | $ | 8,423 | |||||||||||||||||
A roll-forward of troubled debt restructuring during the year ended December 31, 2013 (dollars in thousands): | |||||||||||||||||||||||||||||
Commercial, | One to four | Consumer and | |||||||||||||||||||||||||||
Commercial | Financial and | Commercial | family residential | Consumer | |||||||||||||||||||||||||
Real Estate | Agricultural | Construction | real estate | Construction | Total | ||||||||||||||||||||||||
ACCRUING | |||||||||||||||||||||||||||||
Beginning balance | $ | 3,611 | $ | 1,221 | $ | 858 | $ | 102 | $ | — | $ | 5,792 | |||||||||||||||||
Principal payments | (91 | ) | (460 | ) | (3 | ) | — | (554 | ) | ||||||||||||||||||||
Charge-offs | — | — | — | — | — | ||||||||||||||||||||||||
Advances | — | — | — | — | — | ||||||||||||||||||||||||
New restructured | — | 953 | — | — | 953 | ||||||||||||||||||||||||
Transferred out of TDR | — | — | — | — | — | ||||||||||||||||||||||||
Transfers to nonaccrual | — | (528 | ) | — | — | (528 | ) | ||||||||||||||||||||||
Ending Balance | $ | 3,520 | $ | 1,186 | $ | 858 | $ | 99 | $ | — | $ | 5,663 | |||||||||||||||||
NONACCRUAL | |||||||||||||||||||||||||||||
Beginning balance | $ | 2,162 | $ | — | $ | — | $ | 102 | $ | — | $ | 2,264 | |||||||||||||||||
— | |||||||||||||||||||||||||||||
Principal payments | (1,376 | ) | (5 | ) | — | (15 | ) | — | (1,396 | ) | |||||||||||||||||||
Charge-offs | (793 | ) | — | — | — | — | (793 | ) | |||||||||||||||||||||
Advances | — | — | — | — | — | — | |||||||||||||||||||||||
New restructured | 7 | 528 | — | 4 | — | 539 | |||||||||||||||||||||||
Transfers to foreclosed properties | — | — | — | — | — | — | |||||||||||||||||||||||
Transfers from accruing | — | — | — | — | — | — | |||||||||||||||||||||||
Ending Balance | $ | — | $ | 523 | $ | — | $ | 91 | $ | — | $ | 614 | |||||||||||||||||
TOTALS | |||||||||||||||||||||||||||||
Beginning balance | $ | 5,773 | $ | 1,221 | $ | 858 | $ | 204 | $ | — | $ | 8,056 | |||||||||||||||||
Principal payments | (1,467 | ) | (465 | ) | — | (18 | ) | — | (1,950 | ) | |||||||||||||||||||
Charge-offs | (793 | ) | — | — | — | — | (793 | ) | |||||||||||||||||||||
Advances | — | — | — | — | — | — | |||||||||||||||||||||||
New restructured | 7 | 1,481 | — | 4 | — | 1,492 | |||||||||||||||||||||||
Transfers out of TDRs | — | — | — | — | — | — | |||||||||||||||||||||||
Tansfers to nonaccrual | — | (528 | ) | — | — | — | (528 | ) | |||||||||||||||||||||
Transfers to foreclosed properties | — | — | — | — | — | — | |||||||||||||||||||||||
Transfers from accruing | — | — | — | — | — | — | |||||||||||||||||||||||
Ending Balance | $ | 3,520 | $ | 1,709 | $ | 858 | $ | 190 | $ | — | $ | 6,277 | |||||||||||||||||
Insider Loans | |||||||||||||||||||||||||||||
The Bank, in the ordinary course of business, grants loans to the Corporation’s executive officers and directors, including their families and firms in which they are principal owners. Activity in such loans is summarized below (dollars in thousands): | |||||||||||||||||||||||||||||
September 30, | December 31, | September 30, | |||||||||||||||||||||||||||
2014 | 2013 | 2013 | |||||||||||||||||||||||||||
Loans outstanding, beginning of period | $ | 9,043 | $ | 11,297 | $ | 11,297 | |||||||||||||||||||||||
New loans | 33 | 496 | 496 | ||||||||||||||||||||||||||
Net activity on revolving lines of credit | 1,052 | (266 | ) | (263 | ) | ||||||||||||||||||||||||
Principal payments | (1,614 | ) | (2,484 | ) | (1,442 | ) | |||||||||||||||||||||||
Loans outstanding, end of period | $ | 8,514 | $ | 9,043 | $ | 10,088 | |||||||||||||||||||||||
There were no loans to related parties classified substandard as of September 30, 2014, December 31, 2013 or September 30, 2013. In addition to the outstanding balances above, there were unfunded commitments of $.517 million to related parties at September 30, 2014. | |||||||||||||||||||||||||||||
MORTGAGE_SERVICING_RIGHTS
MORTGAGE SERVICING RIGHTS | 9 Months Ended | ||||||||||
Sep. 30, 2014 | |||||||||||
MORTGAGE SERVICING RIGHTS | ' | ||||||||||
MORTGAGE SERVICING RIGHTS | ' | ||||||||||
6.MORTGAGE SERVICING RIGHTS | |||||||||||
Mortgage servicing rights (“MSRs”) are recorded when loans are sold in the secondary market with servicing retained. As of September 30, 2014, the Corporation had obligations to service approximately $144.051 million of residential first mortgage loans. The valuation is based upon the net present value of the projected revenues over the expected life of the loans being serviced, as reduced by estimated internal costs to service these loans. The fair value of the capitalized servicing rights approximates the carrying value. The key economic assumptions used in determining the fair value of the mortgage servicing rights include an annual constant prepayment speed of 9.77% and a discount rate of 8.83% for September 30, 2014. | |||||||||||
The following summarizes mortgage servicing rights capitalized and amortized, along with the aggregate activity in related valuation allowances (dollars in thousands): | |||||||||||
Nine months ended | Year ended | Nine months ended | |||||||||
September 30, | December 31, | September 30, | |||||||||
2014 | 2013 | 2013 | |||||||||
Balance at beginning of period | $ | 1,129 | $ | 638 | $ | 638 | |||||
Additions from loans sold with servicing retained | 375 | 675 | 325 | ||||||||
Amortization | (218 | ) | (184 | ) | (129 | ) | |||||
Estimated Valuation of MSRs at end of period | $ | 1,286 | $ | 1,129 | $ | 834 | |||||
BORROWINGS
BORROWINGS | 9 Months Ended | ||||||||||
Sep. 30, 2014 | |||||||||||
BORROWINGS | ' | ||||||||||
BORROWINGS | ' | ||||||||||
7.BORROWINGS | |||||||||||
Borrowings consist of the following at September 30, 2014, December 31, 2013 and September 30, 2013 (dollars in thousands): | |||||||||||
September 30, | December 31, | September 30, | |||||||||
2014 | 2013 | 2013 | |||||||||
Federal Home Loan Bank fixed rate advances at September 30, 2014 with a weighted average rate of 1.82% maturing in 2014, 2016 and 2018 | $ | 35,000 | $ | 35,000 | $ | 35,000 | |||||
Correspondent bank line of credit - holding company | 4,500 | 2,000 | — | ||||||||
Bank line of credit - wholly-owned asset based lending subsidiary | 1,830 | — | — | ||||||||
Correspondent bank term note, current floor rate of 4%, maturing December 28, 2017 | 2,800 | — | — | ||||||||
USDA Rural Development, fixed-rate note payable, maturing August 24, 2024, interest payable at 1% | 779 | 852 | 852 | ||||||||
$ | 44,909 | $ | 37,852 | $ | 35,852 | ||||||
The Federal Home Loan Bank borrowings are collateralized at September 30, 2014 by the following: a collateral agreement on the Corporation’s one to four family residential real estate loans with a book value of approximately $42.041 million; mortgage related and municipal securities with an amortized cost and estimated fair value of $4.167 million and $4.300 million, respectively; and Federal Home Loan Bank stock owned by the Bank totaling $3.060 million. Prepayment of the advances is subject to the provisions and conditions of the credit policy of the Federal Home Loan Bank of Indianapolis in effect as of September 30, 2014. | |||||||||||
The USDA Rural Development borrowing is collateralized by loans totaling $.779 million originated and held by the Corporation’s wholly owned subsidiary, First Rural Relending, and an assignment of a demand deposit account in the amount of $.720 million, and guaranteed by the Corporation. | |||||||||||
The Corporation currently has two banking borrowing relationships. The first relationship consists of a non-revolving line of credit and a term note. The line of credit bears interest at 90-day LIBOR plus 2.75%, with a floor rate of 4.00% and has an initial term that expires on December 28, 2017. The term note bears the same interest and matures on March 22, 2017 and requires quarterly principal payments of $100,000 beginning June 30, 2014. The second borrowing relationship consists of a $10 million revolving line of credit, which can be increased to $25 million upon request, used to support asset based lending activities at a wholly-owned subsidiary that currently bears interest at 90-day LIBOR plus 2.75% and has an initial term that expires on September 10, 2016. | |||||||||||
STOCK_COMPENSATION_PLANS
STOCK COMPENSATION PLANS | 9 Months Ended | ||||||||||
Sep. 30, 2014 | |||||||||||
STOCK COMPENSATION PLANS | ' | ||||||||||
STOCK COMPENSATION PLANS | ' | ||||||||||
8.STOCK COMPENSATION PLANS | |||||||||||
On May 22, 2012, the Company’s shareholders approved the Mackinac Financial Corporation 2012 Incentive Compensation Plan, under which current and prospective employees, non-employee directors and consultants may be awarded incentive stock options, non-statutory stock options, shares of restricted stock units (“RSUs”), or stock appreciation rights. The aggregate number of shares of the Company’s common stock issuable under the plan is 575,000, which included 392,152 option shares outstanding at that time. Awards are made at the discretion of management. Compensation cost equal to the fair value of the award is recognized over the vesting period. | |||||||||||
The Corporation, in August 2012 and March 2014, granted Restricted Stock Units (“RSUs”) to members of the Board of Directors and Management. In August 2012, 148,500 RSUs were granted at a market value of $7.91 and will vest equally over a four year term. In exchange for the grant of these RSUs various previously issued stock option awards were surrendered. In March 2014, 52,774 RSUs were granted at a market value of $12.95, also vesting equally over a four year term. The RSUs were awarded at no cost to the employee. Compensation cost to be recognized over the four —year vesting periods, is $1.175 million and $.683 million, respectively. On August 31, 2013, the Corporation issued 37,125 shares of its common stock for vested RSUs. As of September 30, 2014, RSUs totaling 127,024 were unvested and unrecognized compensation expense was $1.154 million. | |||||||||||
A summary of stock option transactions for the nine months ended September 30, 2014 and 2013, and the year ended December 31, 2013, is as follows: | |||||||||||
September 30, | December 31, | September 30, | |||||||||
2014 | 2013 | 2013 | |||||||||
Outstanding shares at beginning of year | 237,152 | 242,152 | 242,152 | ||||||||
Granted during the period | — | — | — | ||||||||
Exercised during the period | — | — | — | ||||||||
Expired / forfeited during the period | — | — | (5,000 | ) | |||||||
Surrendered/Echanged for restricted stock | — | (5,000 | ) | — | |||||||
Outstanding shares at end of period | 237,152 | 237,152 | 237,152 | ||||||||
Exercisable shares at end of period | 124,861 | 124,861 | 125,861 | ||||||||
Weighted average exercise price per share at end of period | $ | 9.8 | $ | 9.8 | $ | 9.88 | |||||
Shares available for grant at end of period | — | — | — | ||||||||
There were no options granted in the first nine months of 2014 and 2013. | |||||||||||
Following is a summary of the options outstanding and exercisable at September 30, 2014: | |||||||||||
Weighted Average | |||||||||||
Exercise | Number | Remaining | |||||||||
Price | Outstanding | Exercisable | Unvested Options | Contractual Life-Years | |||||||
$ | 9.75 | 217,152 | 120,861 | 96,291 | 0.23 | ||||||
$ | 10.65 | 10,000 | 2,000 | 8,000 | 0.79 | ||||||
$ | 12.00 | 10,000 | 2,000 | 8,000 | 2.21 | ||||||
237,152 | 124,861 | 112,291 | 0.34 | ||||||||
INCOME_TAXES
INCOME TAXES | 9 Months Ended |
Sep. 30, 2014 | |
INCOME TAXES | ' |
INCOME TAXES | ' |
9.INCOME TAXES | |
A valuation allowance is provided against deferred tax assets when it is more likely than not that some or all of the deferred tax asset will not be realized. The Corporation, as of September 30, 2014 had a net operating loss and tax credit carryforwards for tax purposes of approximately $16.3 million, and $2.4 million, respectively. The net operating loss carryforwards expire twenty years from the date they originated. These carryforwards, if not utilized, will begin to expire in the year 2023. A portion of the NOL and all of the credit carryforwards are subject to the limitations for utilization as set forth in Section 382 of the Internal Revenue Code. The annual limitation is $1.400 million for the NOL and the equivalent value of tax credits, which is approximately $.476 million. These limitations for use were established in conjunction with the recapitalization of the Corporation in December 2004. | |
The Corporation has reported deferred tax assets of $8.681 million at September 30, 2014, which is net of a valuation allowance of $.760 million. Management evaluated the deferred tax valuation allowance as of September 30, 2014 and determined that no adjustment to the valuation was warranted. The remaining valuation allowance pertains to the existing tax credit carryovers, which will only be utilized after all net operating loss carryforwards. Since a portion of these tax credits may expire before that occurs, a valuation allowance for these has been established. The Corporation will continue to evaluate the future benefits from these carryforwards in order to determine if any adjustment to the deferred tax asset is warranted. | |
FAIR_VALUE_MEASUREMENTS
FAIR VALUE MEASUREMENTS | 9 Months Ended | |||||||||||||||||||||
Sep. 30, 2014 | ||||||||||||||||||||||
FAIR VALUE MEASUREMENTS | ' | |||||||||||||||||||||
FAIR VALUE MEASUREMENTS | ' | |||||||||||||||||||||
10. FAIR VALUE MEASUREMENTS | ||||||||||||||||||||||
Fair value estimates, methods, and assumptions are set forth below for the Corporation’s financial instruments: | ||||||||||||||||||||||
Cash, cash equivalents, and interest-bearing deposits - The carrying values approximate the fair values for these assets. | ||||||||||||||||||||||
Securities - Fair values are based on quoted market prices where available. If a quoted market price is not available, fair value is estimated using quoted market prices for similar securities and other inputs such as interest rates and yield curves that are observable at commonly quoted intervals. | ||||||||||||||||||||||
Federal Home Loan Bank stock — Federal Home Loan Bank stock is carried at cost, which is its redeemable value and approximates its fair value, since the market for this stock is limited. | ||||||||||||||||||||||
Loans - Fair values are estimated for portfolios of loans with similar financial characteristics. Loans are segregated by type such as commercial, residential mortgage, and other consumer. The fair value of loans is calculated by discounting scheduled cash flows using discount rates reflecting the credit and interest rate risk inherent in the loan. | ||||||||||||||||||||||
The methodology in determining fair value of nonaccrual loans is to average them into the blended interest rate at 0% interest. This has the effect of decreasing the carrying amount below the risk-free rate amount and, therefore, discounts the estimated fair value. | ||||||||||||||||||||||
Impaired loans are measured at the estimated fair value of the expected future cash flows at the loan’s effective interest rate or the fair value of the collateral for loans which are collateral dependent. Therefore, the carrying values of impaired loans approximate the estimated fair values for these assets. | ||||||||||||||||||||||
Deposits - The fair value of deposits with no stated maturity, such as noninterest-bearing demand deposits and savings, is equal to the amount payable on demand at the reporting date. The fair value of time deposits is based on the discounted value of contractual cash flows applying interest rates currently being offered on similar time deposits. | ||||||||||||||||||||||
Borrowings - Rates currently available for debt with similar terms and remaining maturities are used to estimate the fair value of existing debt. The fair value of borrowed funds due on demand is the amount payable at the reporting date. | ||||||||||||||||||||||
Accrued interest - The carrying amount of accrued interest approximates fair value. | ||||||||||||||||||||||
Off-balance-sheet instruments - The fair value of commitments is estimated using the fees currently charged to enter into similar agreements, taking into account the remaining terms of the agreements, the current interest rates, and the present creditworthiness of the counterparties. Since the differences in the current fees and those reflected to the off-balance-sheet instruments at year-end are immaterial, no amounts for fair value are presented. | ||||||||||||||||||||||
The following table presents information for financial instruments at September 30, 2014, December 31, 2013 and September 30, 2013 (dollars in thousands): | ||||||||||||||||||||||
September 30, 2014 | December 31, 2013 | September 30, 2013 | ||||||||||||||||||||
Level in Fair | Carrying | Estimated | Carrying | Estimated | Carrying | Estimated | ||||||||||||||||
Value Hierarchy | Amount | Fair Value | Amount | Fair Value | Amount | Fair Value | ||||||||||||||||
Financial assets: | ||||||||||||||||||||||
Cash and cash equivalents | Level 1 | $ | 22,401 | $ | 22,401 | $ | 18,219 | $ | 18,219 | $ | 22,794 | $ | 22,794 | |||||||||
Interest-bearing deposits | Level 2 | 235 | 235 | 10 | 10 | 10 | 10 | |||||||||||||||
Securities available for sale | Level 2 | 48,742 | 48,742 | 44,388 | 44,388 | 48,096 | 48,096 | |||||||||||||||
Federal Home Loan Bank stock | Level 2 | 3,060 | 3,060 | 3,060 | 3,060 | 3,060 | 3,060 | |||||||||||||||
Net loans | Level 2 | 513,094 | 513,117 | 479,171 | 479,538 | 467,536 | 460,009 | |||||||||||||||
Accrued interest receivable | Level 3 | 1,457 | 1,457 | 1,351 | 1,351 | 1,536 | 1,536 | |||||||||||||||
Total financial assets | $ | 588,989 | $ | 589,012 | $ | 546,199 | $ | 546,566 | $ | 543,032 | $ | 535,505 | ||||||||||
Financial liabilities: | ||||||||||||||||||||||
Deposits | Level 2 | $ | 491,206 | $ | 491,912 | $ | 466,299 | $ | 465,431 | $ | 461,688 | $ | 459,862 | |||||||||
Borrowings | Level 2 | 44,909 | 45,285 | 37,852 | 37,487 | 35,852 | 35,548 | |||||||||||||||
Accrued interest payable | Level 3 | 184 | 184 | 182 | 182 | 200 | 200 | |||||||||||||||
Total financial liabilties | $ | 536,299 | $ | 537,381 | $ | 504,333 | $ | 503,100 | $ | 497,740 | $ | 495,610 | ||||||||||
Limitations - Fair value estimates are made at a specific point in time based on relevant market information and information about the financial instrument. These estimates do not reflect any premium or discount that could result from offering for sale at one time the Corporation’s entire holdings of a particular financial instrument. Because no market exists for a significant portion of the Corporation’s financial instruments, fair value estimates are based on judgments regarding future expected loss experience, current economic conditions, risk characteristics of various financial instruments, and other factors. These estimates are subjective in nature and involve uncertainties and matters of significant judgment and therefore cannot be determined with precision. Changes in assumptions could significantly affect the estimates. Fair value estimates are based on existing on-and off-balance-sheet financial instruments without attempting to estimate the value of anticipated future business and the value of assets and liabilities that are not considered financial instruments. Significant assets and liabilities that are not considered financial assets or liabilities include premises and equipment, other assets, and other liabilities. In addition, the tax ramifications related to the realization of the unrealized gains and losses can have a significant effect on fair value estimates and have not been considered in the estimates. | ||||||||||||||||||||||
The following is information about the Corporation’s assets and liabilities measured at fair value on a recurring basis at September 30, 2014, and the valuation techniques used by the Corporation to determine those fair values. | ||||||||||||||||||||||
Level 1:In general, fair values determined by Level 1 inputs use quoted prices in active markets for identical assets or liabilities that the Corporation has the ability to access. | ||||||||||||||||||||||
Level 2:Fair values determined by Level 2 inputs use other inputs that are observable, either directly or indirectly. These Level 2 inputs include quoted prices for similar assets and liabilities in active markets, and other inputs such as interest rates and yield curves that are observable at commonly quoted intervals. | ||||||||||||||||||||||
Level 3:Level 3 inputs are unobservable inputs, including inputs available in situations where there is little, if any, market activity for the related asset or liability. | ||||||||||||||||||||||
The fair value of all investment securities at September 30, 2014 and September 30, 2013 were based on level 2 inputs. There are no other assets or liabilities measured on a recurring basis at fair value. For additional information regarding investment securities, please refer to “Note 4 Investment Securities.” | ||||||||||||||||||||||
The Corporation had no Level 3 assets or liabilities on a recurring basis as of September 30, 2014, December 31, 2013 or September 30, 2013. | ||||||||||||||||||||||
In instances where inputs used to measure fair value fall into different levels in the above fair value hierarchy, fair value measurements in their entirety are categorized based on the lowest level input that is significant to the valuation. The Corporation’s assessment of the significance of particular inputs to these fair value measurements requires judgment and considers factors specific to each asset or liability. | ||||||||||||||||||||||
The Corporation also has assets that under certain conditions are subject to measurement at fair value on a non-recurring basis. These assets include loans and other real estate owned. The Corporation has estimated the fair values of these assets using Level 3 inputs, specifically discounted cash flow projections. | ||||||||||||||||||||||
Assets Measured at Fair Value on a Nonrecurring Basis at September 30, 2014 | ||||||||||||||||||||||
Quoted Prices | Significant | Significant | ||||||||||||||||||||
in Active Markets | Other Observable | Unobservable | Total Losses for | Total Losses for | ||||||||||||||||||
Balance at | for Identical Assets | Inputs | Inputs | Three Months Ended | Nine Months Ended | |||||||||||||||||
(dollars in thousands) | September 30, 2014 | (Level 1) | (Level 2) | (Level 3) | September 30, 2014 | September 30, 2014 | ||||||||||||||||
Assets | ||||||||||||||||||||||
Impaired loans | $ | 2,695 | $ | — | $ | — | $ | 2,695 | $ | 10 | $ | 440 | ||||||||||
Other real estate owned | 1,843 | — | — | 1,843 | 176 | 190 | ||||||||||||||||
$ | 186 | $ | 630 | |||||||||||||||||||
Assets Measured at Fair Value on a Nonrecurring Basis at December 31, 2013 | ||||||||||||||||||||||
Quoted Prices | Significant | Significant | ||||||||||||||||||||
in Active Markets | Other Observable | Unobservable | Total Losses for | |||||||||||||||||||
Balance at | for Identical Assets | Inputs | Inputs | Year Ended | ||||||||||||||||||
(dollars in thousands) | December 31, 2013 | (Level 1) | (Level 2) | (Level 3) | December 31, 2013 | |||||||||||||||||
Assets | ||||||||||||||||||||||
Impaired loans | $ | 2,024 | $ | — | $ | — | $ | 2,024 | $ | 2,075 | ||||||||||||
Other real estate owned | 1,884 | — | — | 1,884 | 265 | |||||||||||||||||
$ | 2,340 | |||||||||||||||||||||
Assets Measured at Fair Value on a Nonrecurring Basis at September 30, 2013 | ||||||||||||||||||||||
Quoted Prices | Significant | Significant | ||||||||||||||||||||
in Active Markets | Other Observable | Unobservable | Total Losses for | Total Losses for | ||||||||||||||||||
Balance at | for Identical Assets | Inputs | Inputs | Three Months Ended | Nine Months Ended | |||||||||||||||||
(dollars in thousands) | September 30, 2013 | (Level 1) | (Level 2) | (Level 3) | September 30, 2013 | September 30, 2013 | ||||||||||||||||
Assets | ||||||||||||||||||||||
Impaired loans | $ | 4,313 | $ | — | $ | — | $ | 4,313 | $ | 531 | $ | 949 | ||||||||||
Other real estate owned | 2,568 | — | — | 2,568 | 57 | 146 | ||||||||||||||||
$ | 588 | $ | 1,095 | |||||||||||||||||||
The Corporation had no investments subject to fair value measurement on a nonrecurring basis. | ||||||||||||||||||||||
Impaired loans categorized as Level 3 assets consist of non-homogeneous loans that are considered impaired. The Corporation estimates the fair value of the loans based on the present value of expected future cash flows using management’s best estimate of key assumptions. These assumptions include future payment ability, timing of payment streams, and estimated realizable values of available collateral (typically based on outside appraisals). | ||||||||||||||||||||||
SHAREHOLDERS_EQUITY
SHAREHOLDER'S EQUITY | 9 Months Ended |
Sep. 30, 2014 | |
SHAREHOLDER'S EQUITY | ' |
SHAREHOLDER'S EQUITY | ' |
11. SHAREHOLDER’S EQUITY | |
In August 2012 the Corporation consummated the $7.000 million rights offering and the investment by Steinhardt Capital Investors, LLLP (“SCI”) by issuing 2,140,123 shares of common stock for net proceeds of $11.506 million. Also, in August 2012, the Corporation exited the TARP Capital Purchase Program (“CPP”) when the Corporation’s 11,000 Series A Preferred Shares, issued in April, 2009 to the U.S. Treasury, were publically offered and sold. The Corporation repurchased the 379,310 of Common Stock Warrants issued to the U.S. Treasury under the CPP in December, 2012 for $1.3 million. During 2013, the Corporation redeemed all of the outstanding Series A Preferred Shares. | |
The Corporation currently has a share repurchase program. The program is conducted under authorizations from time to time by the Board of Directors. The Corporation repurchased 55,594 shares in 2013 and 13,700 shares in the first quarter of 2014. The share repurchases were conducted under Board authorizations made and publically announced of $600,000 on February 27, 2013 and an additional $600,000 on December 17, 2013. Neither of these authorizations has an expiration date. | |
COMMITMENTS_CONTINGENCIES_AND_
COMMITMENTS, CONTINGENCIES AND CREDIT RISK | 9 Months Ended | ||||||||||
Sep. 30, 2014 | |||||||||||
COMMITMENTS, CONTINGENCIES, AND CREDIT RISK | ' | ||||||||||
COMMITMENTS, CONTINGENCIES, AND CREDIT RISK | ' | ||||||||||
12. COMMITMENTS, CONTINGENCIES AND CREDIT RISK | |||||||||||
Financial Instruments With Off-Balance-Sheet Risk | |||||||||||
The Corporation 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. Those instruments involve, to varying degrees, elements of credit risk in excess of the amount recognized in the consolidated balance sheets. | |||||||||||
The Corporation’s exposure to credit loss, in the event of nonperformance 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 Corporation uses the same credit policies in making commitments and conditional obligations as it does for on-balance-sheet instruments. These commitments are as follows (dollars in thousands): | |||||||||||
September 30, | December 31, | September 30, | |||||||||
2013 | 2013 | 2013 | |||||||||
Commitments to extend credit: | |||||||||||
Variable rate | $ | 54,962 | $ | 36,039 | $ | 32,061 | |||||
Fixed rate | 19,092 | 15,070 | 24,536 | ||||||||
Standby letters of credit - Variable rate | 5,730 | 5,077 | 4,741 | ||||||||
Credit card commitments - Fixed rate | 3,286 | 3,152 | 3,162 | ||||||||
$ | 83,070 | $ | 59,338 | $ | 64,500 | ||||||
Commitments to extend credit are agreements to lend to a customer as long as there is no violation of any condition established in the contract. Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. 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 Corporation evaluates each customer’s creditworthiness on a case-by-case basis. The amount of collateral obtained, if deemed necessary by the Corporation upon extension of credit, is based on management’s credit evaluation of the party. Collateral held varies, but may include accounts receivable, inventory, property, plant and equipment, and income-producing commercial properties. | |||||||||||
Standby letters of credit are conditional commitments issued by the Corporation to guarantee the performance of a customer to a third party. Those guarantees are primarily issued to support public and private borrowing arrangements. The credit risk involved in issuing letters of credit is essentially the same as that involved in extending loan facilities to customers. The commitments are structured to allow for 100% collateralization on all standby letters of credit. | |||||||||||
Credit card commitments are commitments on credit cards issued by the Corporation’s subsidiary and serviced by other companies. These commitments are unsecured. | |||||||||||
Legal Proceedings and Contingencies | |||||||||||
In the normal course of business, the Corporation is involved in various legal proceedings. For expanded discussion on the Corporation’s legal proceedings, see Part II, Item 1, “Legal Proceedings” in this report. | |||||||||||
Concentration of Credit Risk | |||||||||||
The Bank grants commercial, residential, agricultural, and consumer loans throughout Michigan. The Bank’s most prominent concentration in the loan portfolio relates to commercial real estate loans to operators of nonresidential buildings. This concentration at September 30, 2014 represents $100.912 million, or 26.30%, compared to $101.406 million, or 28.68%, of the commercial loan portfolio on September 30, 2013. The remainder of the commercial loan portfolio is diversified in such categories as hospitality and tourism, real estate agents and managers, new car dealers, gaming, petroleum, forestry, agriculture and construction. Due to the diversity of the Bank’s locations, the ability of debtors of residential and consumer loans to honor their obligations is not tied to any particular economic sector. | |||||||||||
PENDING_ACQUISITION
PENDING ACQUISITION | 9 Months Ended |
Sep. 30, 2014 | |
Pending Acquisition Abstract | ' |
Pending Acquisition | ' |
13. PENDING ACQUISITION | |
On July 18, 2014, the Corporation announced the signing of a definitive agreement to acquire Peninsula Financial Corporation (“Peninsula”) for $13.285 million. The purchase price of Peninsula contemplates a special dividend to Peninsula shareholders prior to the consummation that would reduce the acquired equity to $10.5 million. Peninsula is headquartered in Marquette County, Michigan and is the parent of Peninsula Bank with September 30 assets of approximately $132 million and six banking offices. The consummation of this transaction is expected to occur early in the fourth quarter of 2014. The Corporation has received all regulatory approvals for the transaction; however, the acquisition is subject to Peninsula shareholder approval, with a vote scheduled for November 24, 2014. | |
The Corporation, in connection with this transaction, filed a proxy statement/prospectus on Form S-4 on September 3, 2014, an amendment to the S-4 on October 20, 2014, and a final proxy statement/prospectus on October 29, 2014. These documents provide more detailed pro-forma financial information with respect to the pending acquisition. | |
SUMMARY_OF_SIGNIFICANT_ACCOUNT1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 9 Months Ended |
Sep. 30, 2014 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ' |
Basis of Presentation | ' |
Basis of Presentation | |
The unaudited condensed consolidated financial statements of Mackinac Financial Corporation (the “Corporation”) have been prepared in accordance with generally accepted accounting principles for interim financial information and the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the nine-month period ended September 30, 2014 are not necessarily indicative of the results that may be expected for the year ending December 31, 2014. The unaudited consolidated financial statements and footnotes thereto should be read in conjunction with the audited consolidated financial statements and footnotes thereto included in the Corporation’s Annual Report on Form 10-K for the year ended December 31, 2013. | |
In order to properly reflect some categories of other income and other expenses, reclassifications of expense and income items have been made to prior period numbers. The “net” other income and other expenses was not changed due to these reclassifications. | |
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Material estimates that are particularly susceptible to significant change in the near term relate to the determination of the allowance for loan losses, and the valuation of deferred tax assets, mortgage servicing rights and other real estate held for sale. | |
Allowance for Loan Losses | ' |
Allowance for Loan Losses | |
The allowance for loan losses includes specific allowances related to commercial loans, when they have been judged to be impaired. A loan is impaired when, based on current information, it is probable that the Corporation will not collect all amounts due in accordance with the contractual terms of the loan agreement. These specific allowances are based on discounted cash flows of expected future payments using the loan’s initial effective interest rate or the fair value of the collateral if the loan is collateral dependent. | |
The Corporation continues to maintain a general allowance for loan losses for loans not considered impaired. The allowance for loan losses is maintained at a level which management believes is adequate to provide for possible loan losses. Management periodically evaluates the adequacy of the allowance using the Corporation’s past loan loss experience, known and inherent risks in the portfolio, composition of the portfolio, current economic conditions, and other factors. The allowance does not include the effects of expected losses related to future events or future changes in economic conditions. This evaluation is inherently subjective since it requires material estimates that may be susceptible to significant change. Loans are charged against the allowance for loan losses when management believes the collectability of the principal is unlikely. In addition, various regulatory agencies periodically review the allowance for loan losses. These agencies may require additions to the allowance for loan losses based on their judgments of collectability. | |
In management’s opinion, the allowance for loan losses is adequate to cover probable losses relating to specifically identified loans, as well as probable losses inherent in the balance of the loan portfolio as of the balance sheet date. | |
Stock Compensation Plans | ' |
Stock Compensation Plans | |
On May 22, 2012, the Company’s shareholders approved the Mackinac Financial Corporation 2012 Incentive Compensation Plan, under which current and prospective employees, non-employee directors and consultants may be awarded incentive stock options, non-statutory stock options, shares of restricted stock units (“RSUs”), or stock appreciation rights. The aggregate number of shares of the Company’s common stock issuable under the plan is 575,000, which included 392,152 option shares outstanding at that time. Awards are made at the discretion of management. Compensation cost equal to the fair value of the award is recognized over the vesting period. | |
The Corporation, in August 2012 and March 2014, granted Restricted Stock Units (“RSUs”) to members of the Board of Directors and Management. In August 2012, 148,500 RSUs were granted at a market value of $7.91 and will vest equally over a four year term. In exchange for the grant of these RSUs various previously issued stock option awards were surrendered. In March 2014, 52,774 RSUs were granted at a market value of $12.95, also vesting equally over a four year term. The RSUs were awarded at no cost to the employee. Compensation cost to be recognized over the four —year vesting periods, is $1.175 million and $.683 million, respectively. On August 31, 2013, the Corporation issued 37,125 shares of its common stock for vested RSUs. As of September 30, 2014, RSUs totaling 127,024 were unvested and unrecognized compensation expense was $1.154 million. | |
EARNINGS_PER_SHARE_Tables
EARNINGS PER SHARE (Tables) | 9 Months Ended | |||||||||||||
Sep. 30, 2014 | ||||||||||||||
EARNINGS PER SHARE | ' | |||||||||||||
Schedule showing the computation of basic and diluted earnings per share | ' | |||||||||||||
The following shows the computation of basic and diluted earnings per share for the three and nine months ended September 30, 2014 and 2013 (dollars in thousands, except per share data): | ||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||
(Numerator): | ||||||||||||||
Net income | $ | 886 | $ | 896 | $ | 2,352 | $ | 2,969 | ||||||
Preferred stock dividends and accretion of discount | — | 50 | — | 250 | ||||||||||
Net income available to common shareholders | $ | 886 | $ | 846 | $ | 2,352 | $ | 2,719 | ||||||
(Denominator): | ||||||||||||||
Weighted average shares outstanding - basic | 5,540,200 | 5,562,835 | 5,532,966 | 5,559,108 | ||||||||||
Effect of dilutive stock options and vesting of restricted stock awards | 71,722 | — | 70,268 | — | ||||||||||
Weighted average shares outstanding - diluted | 5,611,922 | 5,562,835 | 5,603,234 | 5,559,108 | ||||||||||
Income per common share | ||||||||||||||
Basic | $ | 0.16 | $ | 0.15 | $ | 0.43 | $ | 0.49 | ||||||
Diluted | $ | 0.16 | $ | 0.15 | $ | 0.42 | $ | 0.49 | ||||||
INVESTMENT_SECURITIES_Tables
INVESTMENT SECURITIES (Tables) | 9 Months Ended | |||||||||||||
Sep. 30, 2014 | ||||||||||||||
INVESTMENT SECURITIES | ' | |||||||||||||
Schedule of amortized cost and estimated fair value of investment securities available for sale | ' | |||||||||||||
The amortized cost and estimated fair value of investment securities available for sale as of September 30, 2014, December 31, 2013 and September 30, 2013 are as follows (dollars in thousands): | ||||||||||||||
Gross | Gross | |||||||||||||
Amortized | Unrealized | Unrealized | Estimated | |||||||||||
Cost | Gains | Losses | Fair Value | |||||||||||
September 30, 2014 | ||||||||||||||
US Agencies - MBS | $ | 6,142 | $ | 241 | $ | — | $ | 6,383 | ||||||
US Agencies | 22,725 | 41 | -273 | 22,493 | ||||||||||
Corporate Bonds | 12,621 | 172 | — | 12,793 | ||||||||||
Obligations of states and political subdivisions | 6,383 | 439 | — | 6,822 | ||||||||||
Other | 251 | — | — | 251 | ||||||||||
Total securities available for sale | $ | 48,122 | $ | 893 | $ | -273 | $ | 48,742 | ||||||
December 31, 2013 | ||||||||||||||
US Agencies - MBS | $ | 7,078 | $ | 281 | $ | — | $ | 7,359 | ||||||
US Agencies | 15,227 | — | -372 | 14,855 | ||||||||||
Corporate Bonds | 15,862 | 218 | -1 | 16,079 | ||||||||||
Obligations of states and political subdivisions | 5,893 | 202 | — | 6,095 | ||||||||||
Total securities available for sale | $ | 44,060 | $ | 701 | $ | -373 | $ | 44,388 | ||||||
September 30, 2013 | ||||||||||||||
US Agencies - MBS | $ | 7,236 | $ | 315 | $ | — | $ | 7,551 | ||||||
US Agencies | 16,003 | 66 | -336 | 15,733 | ||||||||||
Corporate Bonds | 18,451 | 192 | -4 | 18,639 | ||||||||||
Obligations of states and political subdivisions | 5,876 | 297 | — | 6,173 | ||||||||||
Total securities available for sale | $ | 47,566 | $ | 870 | $ | -340 | $ | 48,096 | ||||||
LOANS_Tables
LOANS (Tables) | 9 Months Ended | ||||||||||||||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||||||||||||||
LOANS | ' | ||||||||||||||||||||||||||||
Schedule of composition of loans | ' | ||||||||||||||||||||||||||||
The composition of loans is as follows (dollars in thousands): | |||||||||||||||||||||||||||||
September 30, | December 31, | September 30, | |||||||||||||||||||||||||||
2014 | 2013 | 2013 | |||||||||||||||||||||||||||
Commercial real estate | $ | 272,803 | $ | 268,809 | $ | 257,961 | |||||||||||||||||||||||
Commercial, financial, and agricultural | 98,714 | 79,655 | 79,511 | ||||||||||||||||||||||||||
One to four family residential real estate | 110,310 | 103,768 | 98,770 | ||||||||||||||||||||||||||
Construction : | |||||||||||||||||||||||||||||
Consumer | 8,729 | 6,895 | 5,734 | ||||||||||||||||||||||||||
Commerical | 12,242 | 10,904 | 16,054 | ||||||||||||||||||||||||||
Consumer | 15,575 | 13,801 | 14,465 | ||||||||||||||||||||||||||
Total loans | $ | 518,373 | $ | 483,832 | $ | 472,495 | |||||||||||||||||||||||
Schedule of the allowance for loan losses | ' | ||||||||||||||||||||||||||||
An analysis of the allowance for loan losses for nine months ended September 30, 2014, the year ended December 31, 2013 and the nine months ended September 30, 2013 is as follows (dollars in thousands): | |||||||||||||||||||||||||||||
September 30, | December 31, | September 30, | |||||||||||||||||||||||||||
2014 | 2013 | 2013 | |||||||||||||||||||||||||||
Balance at beginning of period | $ | 4,661 | $ | 5,218 | $ | 5,218 | |||||||||||||||||||||||
Loans charged off | (185 | ) | (2,432 | ) | (1,263 | ) | |||||||||||||||||||||||
Recoveries on loans previously charged off | 242 | 200 | 154 | ||||||||||||||||||||||||||
Provision | 561 | 1,675 | 850 | ||||||||||||||||||||||||||
Balance at end of period | $ | 5,279 | $ | 4,661 | $ | 4,959 | |||||||||||||||||||||||
Schedule of breakdown of the allowance for loan losses and recorded balances in loans | ' | ||||||||||||||||||||||||||||
A breakdown of the allowance for loan losses and recorded balances in loans at September 30, 2014 is as follows (dollars in thousands): | |||||||||||||||||||||||||||||
Commercial, | One to four | ||||||||||||||||||||||||||||
Commercial | financial and | Commercial | family residential | Consumer | |||||||||||||||||||||||||
real estate | agricultural | construction | real estate | construction | Consumer | Unallocated | Total | ||||||||||||||||||||||
Three Months Ended September 30, 2014 | |||||||||||||||||||||||||||||
Allowance for loan loss reserve: | |||||||||||||||||||||||||||||
Beginning balance ALLR | $ | 1,630 | $ | 1,669 | $ | 40 | $ | 345 | $ | 15 | $ | 111 | $ | 1,287 | $ | 5,097 | |||||||||||||
Charge-offs | -18 | -9 | — | -28 | — | -15 | — | -70 | |||||||||||||||||||||
Recoveries | 31 | 16 | 3 | 4 | — | 11 | — | 65 | |||||||||||||||||||||
Provision | -1 | -153 | 1 | 80 | 3 | 1 | 256 | 187 | |||||||||||||||||||||
Ending balance ALLR | $ | 1,642 | $ | 1,523 | $ | 44 | $ | 401 | $ | 18 | $ | 108 | $ | 1,543 | $ | 5,279 | |||||||||||||
Nine Months Ended September 30, 2014 | |||||||||||||||||||||||||||||
Allowance for loan loss reserve: | |||||||||||||||||||||||||||||
Beginning balance ALLR | $ | 1,849 | $ | 1,378 | $ | 80 | $ | 516 | $ | 25 | $ | 148 | $ | 665 | $ | 4,661 | |||||||||||||
Charge-offs | -19 | -74 | — | -44 | — | -48 | — | -185 | |||||||||||||||||||||
Recoveries | 105 | 75 | 9 | 18 | — | 35 | — | 242 | |||||||||||||||||||||
Provision | -293 | 144 | -45 | -89 | -7 | -27 | 878 | 561 | |||||||||||||||||||||
Ending balance ALLR | $ | 1,642 | $ | 1,523 | $ | 44 | $ | 401 | $ | 18 | $ | 108 | $ | 1,543 | $ | 5,279 | |||||||||||||
At September 30,2014 | |||||||||||||||||||||||||||||
Loans: | |||||||||||||||||||||||||||||
Ending balance | $ | 272,803 | $ | 98,714 | $ | 12,242 | $ | 110,310 | $ | 8,729 | $ | 15,575 | $ | — | $ | 518,373 | |||||||||||||
Ending balance ALLR | -1,642 | -1,523 | -44 | -401 | -18 | -108 | -1,543 | -5,279 | |||||||||||||||||||||
Net loans | $ | 271,161 | $ | 97,191 | $ | 12,198 | $ | 109,909 | $ | 8,711 | $ | 15,467 | $ | -1,543 | $ | 513,094 | |||||||||||||
Ending balance ALLR: | |||||||||||||||||||||||||||||
Individually evaluated | $ | 312 | $ | 1,104 | $ | — | $ | 167 | $ | — | $ | 32 | $ | — | $ | 1,615 | |||||||||||||
Collectively evaluated | 1,330 | 419 | 44 | 234 | 18 | 76 | 1,543 | 3,664 | |||||||||||||||||||||
Total | $ | 1,642 | $ | 1,523 | $ | 44 | $ | 401 | $ | 18 | $ | 108 | $ | 1,543 | $ | 5,279 | |||||||||||||
Ending balance Loans: | |||||||||||||||||||||||||||||
Individually evaluated | $ | 378 | $ | 1,730 | $ | — | $ | 1,202 | $ | — | $ | 61 | $ | — | $ | 3,371 | |||||||||||||
Collectively evaluated | 272,425 | 96,984 | 12,242 | 109,108 | 8,729 | 15,514 | — | 515,002 | |||||||||||||||||||||
Total | $ | 272,803 | $ | 98,714 | $ | 12,242 | $ | 110,310 | $ | 8,729 | $ | 15,575 | $ | — | $ | 518,373 | |||||||||||||
A breakdown of the allowance for loan losses and recorded balances in loans at December 31, 2013 is as follows (dollars in thousands): | |||||||||||||||||||||||||||||
Commercial, | One to four | ||||||||||||||||||||||||||||
Commercial | financial and | Commercial | family residential | Consumer | |||||||||||||||||||||||||
real estate | agricultural | construction | real estate | construction | Consumer | Unallocated | Total | ||||||||||||||||||||||
Allowance for loan loss reserve: | |||||||||||||||||||||||||||||
Beginning balance ALLR | $ | 3,267 | $ | 692 | $ | 125 | $ | 980 | $ | — | $ | — | $ | 154 | 5,218 | ||||||||||||||
Charge-offs | -1,539 | -632 | — | -141 | — | -120 | — | -2,432 | |||||||||||||||||||||
Recoveries | 92 | 56 | 2 | 26 | 2 | 22 | — | 200 | |||||||||||||||||||||
Provision | 29 | 1,262 | -47 | -349 | 23 | 246 | 511 | 1,675 | |||||||||||||||||||||
Ending balance ALLR | $ | 1,849 | $ | 1,378 | $ | 80 | $ | 516 | $ | 25 | $ | 148 | $ | 665 | $ | 4,661 | |||||||||||||
Loans: | |||||||||||||||||||||||||||||
Ending balance | $ | 268,809 | $ | 79,655 | $ | 10,904 | $ | 103,768 | $ | 6,895 | $ | 13,801 | $ | — | $ | 483,832 | |||||||||||||
Ending balance ALLR | -1,849 | -1,378 | -80 | -516 | -25 | -148 | -665 | -4,661 | |||||||||||||||||||||
Net loans | $ | 266,960 | $ | 78,277 | $ | 10,824 | $ | 103,252 | $ | 6,870 | $ | 13,653 | $ | -665 | $ | 479,171 | |||||||||||||
Ending balance ALLR: | |||||||||||||||||||||||||||||
Individually evaluated | $ | 99 | $ | 891 | $ | — | $ | 103 | $ | — | $ | 18 | $ | — | $ | 1,111 | |||||||||||||
Collectively evaluated | 1,750 | 487 | 80 | 413 | 25 | 130 | 665 | 3,550 | |||||||||||||||||||||
Total | $ | 1,849 | $ | 1,378 | $ | 80 | $ | 516 | $ | 25 | $ | 148 | $ | 665 | $ | 4,661 | |||||||||||||
Ending balance Loans: | |||||||||||||||||||||||||||||
Individually evaluated | $ | 649 | $ | 1,830 | $ | — | $ | 385 | $ | — | $ | 42 | $ | — | $ | 2,906 | |||||||||||||
Collectively evaluated | 268,160 | 77,825 | 10,904 | 103,383 | 6,895 | 13,759 | — | 480,926 | |||||||||||||||||||||
Total | $ | 268,809 | $ | 79,655 | $ | 10,904 | $ | 103,768 | $ | 6,895 | $ | 13,801 | $ | — | $ | 483,832 | |||||||||||||
A breakdown of the allowance for loan losses and recorded balances in loans at September 30, 2013 is as follows (dollars in thousands): | |||||||||||||||||||||||||||||
Commercial, | One to four | ||||||||||||||||||||||||||||
Commercial | financial and | Commercial | family residential | Consumer | |||||||||||||||||||||||||
real estate | agricultural | construction | real estate | construction | Consumer | Unallocated | Total | ||||||||||||||||||||||
Three Months Ended September 30, 2013 | |||||||||||||||||||||||||||||
Allowance for loan loss reserve: | |||||||||||||||||||||||||||||
Beginning balance ALLR | $ | 2,661 | $ | 1,090 | $ | 97 | $ | 877 | $ | — | $ | 13 | $ | 439 | $ | 5,177 | |||||||||||||
Charge-offs | -132 | -476 | — | -25 | — | -14 | — | -647 | |||||||||||||||||||||
Recoveries | 23 | 20 | — | 6 | 1 | 4 | — | 54 | |||||||||||||||||||||
Provision | 3 | 522 | -16 | 44 | -1 | 15 | -192 | 375 | |||||||||||||||||||||
Ending balance ALLR | $ | 2,555 | $ | 1,156 | $ | 81 | $ | 902 | $ | — | $ | 18 | $ | 247 | $ | 4,959 | |||||||||||||
Nine Months Ended September 30, 2013 | |||||||||||||||||||||||||||||
Allowance for loan loss reserve: | |||||||||||||||||||||||||||||
Beginning balance ALLR | $ | 3,267 | $ | 692 | $ | 125 | $ | 980 | $ | — | $ | — | $ | 154 | $ | 5,218 | |||||||||||||
Charge-offs | -588 | -552 | — | -38 | — | -85 | — | -1,263 | |||||||||||||||||||||
Recoveries | 64 | 53 | 2 | 17 | 1 | 17 | — | 154 | |||||||||||||||||||||
Provision | -188 | 963 | -46 | -57 | -1 | 86 | 93 | 850 | |||||||||||||||||||||
Ending balance ALLR | $ | 2,555 | $ | 1,156 | $ | 81 | $ | 902 | $ | — | $ | 18 | $ | 247 | $ | 4,959 | |||||||||||||
At September 30,2013 | |||||||||||||||||||||||||||||
Loans: | |||||||||||||||||||||||||||||
Ending balance | $ | 257,961 | $ | 79,511 | $ | 16,054 | $ | 98,770 | $ | 5,734 | $ | 14,465 | $ | — | $ | 472,495 | |||||||||||||
Ending balance ALLR | -2,555 | -1,156 | -81 | -902 | — | -18 | -247 | -4,959 | |||||||||||||||||||||
Net loans | $ | 255,406 | $ | 78,355 | $ | 15,973 | $ | 97,868 | $ | 5,734 | $ | 14,447 | $ | -247 | $ | 467,536 | |||||||||||||
Ending balance ALLR: | |||||||||||||||||||||||||||||
Individually evaluated | $ | 1,407 | $ | 802 | $ | 6 | $ | 246 | $ | — | $ | 18 | $ | — | $ | 2,479 | |||||||||||||
Collectively evaluated | 1,148 | 354 | 75 | 656 | — | — | 247 | 2,480 | |||||||||||||||||||||
Total | $ | 2,555 | $ | 1,156 | $ | 81 | $ | 902 | $ | — | $ | 18 | $ | 247 | $ | 4,959 | |||||||||||||
Ending balance Loans: | |||||||||||||||||||||||||||||
Individually evaluated | $ | 13,475 | $ | 7,638 | $ | 798 | $ | 450 | $ | — | $ | 35 | $ | — | $ | 22,396 | |||||||||||||
Collectively evaluated | 244,486 | 71,873 | 15,256 | 98,320 | 5,734 | 14,430 | — | 450,099 | |||||||||||||||||||||
Total | $ | 257,961 | $ | 79,511 | $ | 16,054 | $ | 98,770 | $ | 5,734 | $ | 14,465 | $ | — | $ | 472,495 | |||||||||||||
Schedule of breakdown of loans by risk category | ' | ||||||||||||||||||||||||||||
Below is a breakdown of loans by risk category as of September 30, 2014 (dollars in thousands): | |||||||||||||||||||||||||||||
-1 | -2 | -3 | -4 | -5 | -6 | -7 | Rating | ||||||||||||||||||||||
Acceptable/ | |||||||||||||||||||||||||||||
Excellent | Good | Average | Acceptable Watch | Sp. Mention | Substandard | Doubtful | Unassigned | Total | |||||||||||||||||||||
Commercial real estate | $ | 1,741 | $ | 24,827 | $ | 116,621 | $ | 128,126 | $ | — | $ | 1,488 | $ | — | $ | — | $ | 272,803 | |||||||||||
Commercial, financial and agricultural | 1,736 | 4,472 | 34,547 | 53,311 | — | 4,648 | — | — | 98,714 | ||||||||||||||||||||
Commercial construction | — | 444 | 1,578 | 6,935 | — | 402 | — | 2,883 | 12,242 | ||||||||||||||||||||
One to four family residential real estate | — | 295 | 1,046 | 4,119 | 60 | — | — | 104,790 | 110,310 | ||||||||||||||||||||
Consumer construction | — | — | — | — | — | — | — | 8,729 | 8,729 | ||||||||||||||||||||
Consumer | — | — | 4 | 21 | — | — | — | 15,550 | 15,575 | ||||||||||||||||||||
Total loans | $ | 3,477 | $ | 30,038 | $ | 153,796 | $ | 192,512 | $ | 60 | $ | 6,538 | $ | — | $ | 131,952 | $ | 518,373 | |||||||||||
Below is a breakdown of loans by risk category as of December 31, 2013 (dollars in thousands): | |||||||||||||||||||||||||||||
-1 | -2 | -3 | -4 | -5 | -6 | -7 | Rating | ||||||||||||||||||||||
Acceptable/ | |||||||||||||||||||||||||||||
Excellent | Good | Average | Acceptable Watch | Sp. Mention | Substandard | Doubtful | Unassigned | Total | |||||||||||||||||||||
Commercial real estate | $ | 1,502 | $ | 23,310 | $ | 116,702 | $ | 125,010 | $ | — | $ | 2,285 | $ | — | $ | — | $ | 268,809 | |||||||||||
Commercial, financial and agricultural | 3,741 | 4,348 | 27,455 | 39,070 | — | 5,041 | — | — | 79,655 | ||||||||||||||||||||
Commercial construction | 30 | 479 | 2,702 | 4,340 | — | 402 | — | 2,951 | 10,904 | ||||||||||||||||||||
One-to-four family residential real estate | 251 | 3,074 | 1,275 | 4,482 | — | 710 | — | 93,976 | 103,768 | ||||||||||||||||||||
Consumer construction | — | — | — | — | — | — | — | 6,895 | 6,895 | ||||||||||||||||||||
Consumer | 10 | — | 37 | 43 | — | 30 | — | 13,681 | 13,801 | ||||||||||||||||||||
Total loans | $ | 5,534 | $ | 31,211 | $ | 148,171 | $ | 172,945 | $ | — | $ | 8,468 | $ | — | $ | 117,503 | $ | 483,832 | |||||||||||
Below is a breakdown of loans by risk category as of September 30, 2013 (dollars in thousands): | |||||||||||||||||||||||||||||
-1 | -2 | -3 | -4 | -5 | -6 | -7 | Rating | ||||||||||||||||||||||
Excellent | Good | Average | Acceptable | Sp. Mention | Substandard | Doubtful | Unassigned | Total | |||||||||||||||||||||
Commercial real estate | $ | 2,240 | $ | 23,675 | $ | 88,105 | $ | 123,373 | $ | 16,117 | $ | 4,451 | $ | — | $ | — | $ | 257,961 | |||||||||||
Commercial, financial and agricultural | 4,260 | 5,108 | 22,263 | 41,851 | 3,746 | 2,094 | 189 | — | 79,511 | ||||||||||||||||||||
Commercial construction | — | 676 | 5,283 | 6,167 | 753 | 402 | — | 2,773 | 16,054 | ||||||||||||||||||||
One to four family residential real estate | — | 1,951 | 2,186 | 4,522 | — | 6 | — | 90,105 | 98,770 | ||||||||||||||||||||
Consumer construction | — | — | — | — | — | — | — | 5,734 | 5,734 | ||||||||||||||||||||
Consumer | — | 102 | 34 | 632 | — | — | — | 13,697 | 14,465 | ||||||||||||||||||||
Total loans | $ | 6,500 | $ | 31,512 | $ | 117,871 | $ | 176,545 | $ | 20,616 | $ | 6,953 | $ | 189 | $ | 112,309 | $ | 472,495 | |||||||||||
Summary of impaired loans and their effect on interest income | ' | ||||||||||||||||||||||||||||
The following is a summary of impaired loans and their effect on interest income (dollars in thousands): | |||||||||||||||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||||||||
QTD | YTD | Interest Income | Interest Income | Interest Income | Interest Income | ||||||||||||||||||||||||
Nonaccrual | Accrual | Average | Average | Related | Recognized | on | Recognized | on | |||||||||||||||||||||
Basis | Basis | Investment | Investment | Valuation Reserve | During Impairment | Accrual Basis | During Impairment | Accrual Basis | |||||||||||||||||||||
September 30, 2014 | |||||||||||||||||||||||||||||
With no valuation reserve: | |||||||||||||||||||||||||||||
Commercial real estate | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | |||||||||||
Commercial, financial and agricultural | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||
Commercial construction | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||
One to four family residential real estate | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||
Consumer construction | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||
Consumer | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||
With a valuation reserve: | $ | — | |||||||||||||||||||||||||||
Commercial real estate | $ | 227 | $ | — | $ | 340 | $ | 427 | $ | 227 | $ | — | $ | 4 | — | $ | 20 | ||||||||||||
Commercial, financial and agricultural | 1,735 | — | 1,770 | 1,268 | 1,104 | — | 28 | — | 52 | ||||||||||||||||||||
Commercial construction | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||
One to four family residential real estate | 733 | — | 489 | 434 | 147 | — | 7 | — | 20 | ||||||||||||||||||||
Consumer construction | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||
Consumer | — | — | 11 | 14 | — | — | 1 | 1 | |||||||||||||||||||||
Total: | |||||||||||||||||||||||||||||
Commercial real estate | $ | 227 | $ | — | $ | 340 | $ | 427 | $ | 227 | $ | — | $ | 4 | $ | — | $ | 20 | |||||||||||
Commercial, financial and agricultural | 1,735 | — | 1,770 | 1,268 | 1,104 | — | 28 | — | 52 | ||||||||||||||||||||
Commercial construction | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||
One to four family residential real estate | 733 | — | 489 | 434 | 147 | — | 7 | — | 20 | ||||||||||||||||||||
Consumer construction | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||
Consumer | — | — | 11 | 14 | — | — | 1 | — | 1 | ||||||||||||||||||||
Total | $ | 2,695 | $ | — | $ | 2,610 | $ | 2,143 | $ | 1,478 | $ | — | $ | 40 | $ | — | $ | 93 | |||||||||||
Interest Income | Interest Income | ||||||||||||||||||||||||||||
For the Year Ended: | Nonaccrual | Accrual | Average | Related | Recognized | on | |||||||||||||||||||||||
December 31, 2013 | Basis | Basis | Investment | Valuation Reserve | During Impairment | Accrual Basis | |||||||||||||||||||||||
With no valuation reserve: | |||||||||||||||||||||||||||||
Commercial real estate | $ | 513 | $ | — | $ | 3,045 | $ | — | $ | — | $ | 153 | |||||||||||||||||
Commercial, financial and agricultural | 59 | — | 505 | — | — | 13 | |||||||||||||||||||||||
Commercial construction | — | — | 626 | — | — | 3 | |||||||||||||||||||||||
One to four family residential real estate | 361 | — | 625 | — | — | 16 | |||||||||||||||||||||||
Consumer construction | — | — | — | — | — | — | |||||||||||||||||||||||
Consumer | — | — | 2 | — | — | — | |||||||||||||||||||||||
With a valuation reserve: | |||||||||||||||||||||||||||||
Commercial real estate | $ | 59 | $ | — | $ | 71 | $ | 14 | $ | — | $ | 5 | |||||||||||||||||
Commercial, financial and agricultural | 752 | — | 834 | 265 | — | 18 | |||||||||||||||||||||||
Commercial construction | — | — | — | — | — | — | |||||||||||||||||||||||
One to four family residential real estate | 250 | — | 261 | 78 | — | 20 | |||||||||||||||||||||||
Consumer construction | — | — | — | — | — | — | |||||||||||||||||||||||
Consumer | 30 | — | 30 | 13 | — | — | |||||||||||||||||||||||
Total: | |||||||||||||||||||||||||||||
Commercial real estate | $ | 572 | $ | — | $ | 3,116 | $ | 14 | $ | — | $ | 158 | |||||||||||||||||
Commercial, financial and agricultural | 811 | — | 1,339 | 265 | — | 31 | |||||||||||||||||||||||
Commercial construction | — | — | 626 | — | — | 3 | |||||||||||||||||||||||
One to four family residential real estate | 611 | — | 886 | 78 | — | 36 | |||||||||||||||||||||||
Consumer construction | — | — | — | — | — | — | |||||||||||||||||||||||
Consumer | 30 | — | 32 | 13 | — | — | |||||||||||||||||||||||
Total | $ | 2,024 | $ | — | $ | 5,999 | $ | 370 | $ | — | $ | 228 | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||||||||
QTD | YTD | Interest Income | Interest Income | Interest Income | Interest Income | ||||||||||||||||||||||||
Nonaccrual | Accrual | Average | Average | Related | Recognized | on | Recognized | on | |||||||||||||||||||||
Basis | Basis | Investment | Investment | Valuation Reserve | During Impairment | Accrual Basis | During Impairment | Accrual Basis | |||||||||||||||||||||
September 30, 2013 | |||||||||||||||||||||||||||||
With no valuation reserve: | |||||||||||||||||||||||||||||
Commercial real estate | $ | 238 | $ | — | $ | 412 | $ | 501 | $ | — | $ | — | $ | — | $ | — | $ | 26 | |||||||||||
Commercial, financial and agricultural | — | — | 147 | 243 | — | — | 3 | — | 9 | ||||||||||||||||||||
Commercial construction | — | — | — | 193 | — | — | — | — | 3 | ||||||||||||||||||||
One to four family residential real estate | 67 | — | 86 | 140 | — | — | 2 | — | 7 | ||||||||||||||||||||
Consumer construction | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||
Consumer | 10 | — | 9 | 4 | — | — | — | — | — | ||||||||||||||||||||
With a valuation reserve: | |||||||||||||||||||||||||||||
Commercial real estate | $ | 2,589 | $ | — | $ | 2,581 | $ | 2,557 | $ | 1,272 | $ | — | $ | 42 | $ | — | $ | 102 | |||||||||||
Commercial, financial and agricultural | 767 | — | 741 | 373 | 33 | — | 5 | — | 11 | ||||||||||||||||||||
Commercial construction | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||
One to four family residential real estate | 642 | — | 560 | 396 | 250 | — | 8 | — | 19 | ||||||||||||||||||||
Consumer construction | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||
Consumer | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||
Total: | |||||||||||||||||||||||||||||
Commercial real estate | $ | 2,827 | $ | — | $ | 2,993 | $ | 3,058 | $ | 1,272 | $ | — | $ | 42 | $ | — | $ | 128 | |||||||||||
Commercial, financial and agricultural | 767 | — | 888 | 616 | 33 | — | 8 | — | 20 | ||||||||||||||||||||
Commercial construction | — | — | — | 193 | — | — | — | — | 3 | ||||||||||||||||||||
One to four family residential real estate | 709 | — | 646 | 536 | 250 | — | 10 | — | 26 | ||||||||||||||||||||
Consumer construction | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||
Consumer | 10 | — | 9 | 4 | — | — | — | — | — | ||||||||||||||||||||
Total | $ | 4,313 | $ | — | $ | 4,536 | $ | 4,407 | $ | 1,555 | $ | — | $ | 60 | $ | — | $ | 177 | |||||||||||
Summary of past due loans | ' | ||||||||||||||||||||||||||||
A summary of past due loans at September 30, 2014, December 31, 2013 and September 30, 2013 is as follows (dollars in thousands): | |||||||||||||||||||||||||||||
September 30, | December 31, | September 30, | |||||||||||||||||||||||||||
2014 | 2013 | 2013 | |||||||||||||||||||||||||||
30-89 days | 90+ days | 30-89 days | 90+ days | 30-89 days | 90+ days | ||||||||||||||||||||||||
Past Due | Past Due/ | Past Due | Past Due/ | Past Due | Past Due/ | ||||||||||||||||||||||||
(accruing) | Nonaccrual | Total | (accruing) | Nonaccrual | Total | (accruing) | Nonaccrual | Total | |||||||||||||||||||||
Commercial real estate | $ | 540 | $ | 227 | $ | 767 | $ | — | $ | 572 | $ | 572 | $ | — | $ | 2,827 | $ | 2,827 | |||||||||||
Commercial, financial and agricultural | 306 | 1,735 | 2,041 | 4 | 811 | 815 | 100 | 767 | 867 | ||||||||||||||||||||
Commercial construction | 55 | — | 55 | 20 | — | 20 | — | — | — | ||||||||||||||||||||
One to four family residential real estate | 414 | 733 | 1,147 | 201 | 611 | 812 | 186 | 709 | 895 | ||||||||||||||||||||
Consumer construction | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||
Consumer | 55 | — | 55 | 14 | 30 | 44 | 31 | 10 | 41 | ||||||||||||||||||||
Total past due loans | $ | 1,370 | $ | 2,695 | $ | 4,065 | $ | 239 | $ | 2,024 | $ | 2,263 | $ | 317 | $ | 4,313 | $ | 4,630 | |||||||||||
Schedule of roll-forward of nonaccrual activity | ' | ||||||||||||||||||||||||||||
A roll-forward of nonaccrual activity for the three months ended September 30, 2014 (dollars in thousands): | |||||||||||||||||||||||||||||
For the Three Months Ended September 30, 2014 | |||||||||||||||||||||||||||||
Commercial, | One to four | ||||||||||||||||||||||||||||
Commercial | Financial and | Commercial | family residential | Consumer | |||||||||||||||||||||||||
Real Estate | Agricultural | Construction | real estate | Construction | Consumer | Total | |||||||||||||||||||||||
NONACCRUAL | |||||||||||||||||||||||||||||
Beginning balance | $ | 454 | $ | 1,808 | $ | — | $ | 383 | $ | — | $ | 7 | $ | 2,652 | |||||||||||||||
Principal payments | -2 | -79 | — | -7 | — | — | -88 | ||||||||||||||||||||||
Charge-offs | -18 | -3 | — | -10 | — | -7 | -38 | ||||||||||||||||||||||
Advances | — | — | — | — | — | — | — | ||||||||||||||||||||||
Class transfers | — | — | — | — | — | — | — | ||||||||||||||||||||||
Transfers to OREO | -207 | — | — | — | — | — | -207 | ||||||||||||||||||||||
Transfers to accruing | — | — | — | — | — | — | — | ||||||||||||||||||||||
Transfers from accruing | — | 3 | — | 368 | — | — | 371 | ||||||||||||||||||||||
Other | — | 6 | — | -1 | — | — | 5 | ||||||||||||||||||||||
Ending balance | $ | 227 | $ | 1,735 | $ | — | $ | 733 | $ | — | $ | — | $ | 2,695 | |||||||||||||||
A roll-forward of nonaccrual activity for the three months ended September 30, 2013 (dollars in thousands): | |||||||||||||||||||||||||||||
For the Three Months Ended September 30, 2013 | |||||||||||||||||||||||||||||
Commercial, | One to four | ||||||||||||||||||||||||||||
Commercial | Financial and | Commercial | family residential | Consumer | |||||||||||||||||||||||||
Real Estate | Agricultural | Construction | real estate | Construction | Consumer | Total | |||||||||||||||||||||||
NONACCRUAL | |||||||||||||||||||||||||||||
Beginning balance | $ | 3,057 | $ | 517 | $ | — | $ | 400 | $ | — | $ | 9 | $ | 3,983 | |||||||||||||||
Principal payments | -26 | -224 | — | -12 | — | -1 | -263 | ||||||||||||||||||||||
Charge-offs | -23 | -476 | — | -24 | — | — | -523 | ||||||||||||||||||||||
Advances | — | — | — | — | — | — | — | ||||||||||||||||||||||
Class transfers | — | — | — | — | — | — | — | ||||||||||||||||||||||
Transfers to OREO | -208 | -37 | — | — | — | — | -245 | ||||||||||||||||||||||
Transfers to accruing | — | — | — | — | — | — | — | ||||||||||||||||||||||
Transfers from accruing | — | 966 | — | 344 | — | 2 | 1,312 | ||||||||||||||||||||||
Other | 27 | 21 | — | 1 | 49 | ||||||||||||||||||||||||
Ending balance | $ | 2,827 | $ | 767 | $ | — | $ | 709 | $ | — | $ | 10 | $ | 4,313 | |||||||||||||||
A roll-forward of nonaccrual activity for the nine months ended September 30, 2014 (dollars in thousands): | |||||||||||||||||||||||||||||
For the Nine Months Ended September 30, 2014 | |||||||||||||||||||||||||||||
Commercial, | One to four | ||||||||||||||||||||||||||||
Commercial | Financial and | Commercial | family residential | Consumer | |||||||||||||||||||||||||
Real Estate | Agricultural | Construction | real estate | Construction | Consumer | Total | |||||||||||||||||||||||
NONACCRUAL | |||||||||||||||||||||||||||||
Beginning balance | $ | 572 | $ | 811 | $ | — | $ | 611 | $ | — | $ | 30 | $ | 2,024 | |||||||||||||||
Principal payments | -104 | -160 | — | -29 | — | -4 | -297 | ||||||||||||||||||||||
Charge-offs | -18 | -56 | — | -13 | — | -32 | -119 | ||||||||||||||||||||||
Advances | — | — | — | — | — | — | — | ||||||||||||||||||||||
Class transfers | — | — | — | — | — | — | — | ||||||||||||||||||||||
Transfers to OREO | -233 | — | — | -257 | — | — | -490 | ||||||||||||||||||||||
Transfers to accruing | — | -10 | — | -127 | — | — | -137 | ||||||||||||||||||||||
Transfers from accruing | — | 1,142 | — | 539 | — | 6 | 1,687 | ||||||||||||||||||||||
Other | 10 | 8 | — | 9 | — | — | 27 | ||||||||||||||||||||||
Ending balance | $ | 227 | $ | 1,735 | $ | — | $ | 733 | $ | — | $ | — | $ | 2,695 | |||||||||||||||
A roll-forward of nonaccrual activity for the nine months ended September 30, 2013 (dollars in thousands): | |||||||||||||||||||||||||||||
For the Nine Months Ended September 30, 2013 | |||||||||||||||||||||||||||||
Commercial, | One to four | ||||||||||||||||||||||||||||
Commercial | Financial and | Commercial | family residential | Consumer | |||||||||||||||||||||||||
Real Estate | Agricultural | Construction | real estate | Construction | Consumer | Total | |||||||||||||||||||||||
NONACCRUAL | |||||||||||||||||||||||||||||
Beginning balance | $ | 3,071 | $ | 436 | $ | 675 | $ | 505 | $ | — | $ | — | $ | 4,687 | |||||||||||||||
Principal payments | (174 | ) | (292 | ) | (100 | ) | (77 | ) | — | (1 | ) | (644 | ) | ||||||||||||||||
Charge-offs | (352 | ) | (548 | ) | — | (37 | ) | — | (4 | ) | (941 | ) | |||||||||||||||||
Advances | — | — | — | — | — | — | — | ||||||||||||||||||||||
Class transfers | — | — | — | — | — | — | — | ||||||||||||||||||||||
Transfers to OREO | (208 | ) | (37 | ) | (580 | ) | (107 | ) | — | — | (932 | ) | |||||||||||||||||
Transfers to accruing | — | — | — | — | — | — | — | ||||||||||||||||||||||
Transfers from accruing | 443 | 1,207 | — | 420 | — | 15 | 2,085 | ||||||||||||||||||||||
Other | 47 | 1 | 5 | 5 | — | — | 58 | ||||||||||||||||||||||
Ending balance | $ | 2,827 | $ | 767 | $ | — | $ | 709 | $ | — | $ | 10 | $ | 4,313 | |||||||||||||||
A roll-forward of nonaccrual activity during the year ended December 31, 2013 (dollars in thousands): | |||||||||||||||||||||||||||||
Commercial, | One to four | ||||||||||||||||||||||||||||
Commercial | Financial and | Commercial | family residential | Consumer | |||||||||||||||||||||||||
Real Estate | Agricultural | Construction | real estate | Construction | Consumer | Total | |||||||||||||||||||||||
NONACCRUAL | |||||||||||||||||||||||||||||
Beginning balance | $ | 3,071 | $ | 436 | $ | 675 | $ | 505 | $ | — | $ | — | $ | 4,687 | |||||||||||||||
Principal payments | (1,478 | ) | (319 | ) | (100 | ) | (88 | ) | — | (2 | ) | (1,987 | ) | ||||||||||||||||
Charge-offs | (1,304 | ) | (616 | ) | — | (141 | ) | — | (4 | ) | (2,065 | ) | |||||||||||||||||
Advances | — | — | — | — | — | — | — | ||||||||||||||||||||||
Class transfers | — | — | — | — | — | — | — | ||||||||||||||||||||||
Transfers to OREO | (208 | ) | (37 | ) | (580 | ) | (107 | ) | — | — | (932 | ) | |||||||||||||||||
Transfers to accruing | — | — | — | — | — | — | — | ||||||||||||||||||||||
Transfers from accruing | 443 | 1,346 | — | 434 | — | 36 | 2,259 | ||||||||||||||||||||||
Other | 48 | 1 | 5 | 8 | — | — | 62 | ||||||||||||||||||||||
Ending balance | $ | 572 | $ | 811 | $ | — | $ | 611 | $ | — | $ | 30 | $ | 2,024 | |||||||||||||||
Summary of troubled debt restructurings | ' | ||||||||||||||||||||||||||||
A summary of troubled debt restructurings occurring during the periods indicated is as follows (dollars in thousands): | |||||||||||||||||||||||||||||
September 30, | December 31, | September 30, | |||||||||||||||||||||||||||
2014 | 2013 | 2013 | |||||||||||||||||||||||||||
Number of | Recorded | Number of | Recorded | Number of | Recorded | ||||||||||||||||||||||||
Modifications | Investment | Modifications | Investment | Modifications | Investment | ||||||||||||||||||||||||
Commercial real estate | — | $ | — | — | $ | — | — | $ | — | ||||||||||||||||||||
Commercial, financial and agricultural | — | — | 1 | 528 | 1 | 528 | |||||||||||||||||||||||
Commercial construction | — | — | — | — | — | — | |||||||||||||||||||||||
One to four family residential real estate | — | — | — | — | — | — | |||||||||||||||||||||||
Consumer construction | — | — | — | — | — | — | |||||||||||||||||||||||
Consumer | — | — | — | — | — | — | |||||||||||||||||||||||
Total troubled debt restructurings | — | $ | — | 1 | $ | 528 | 1 | $ | 528 | ||||||||||||||||||||
Schedule of roll-forward of troubled debt restructurings | ' | ||||||||||||||||||||||||||||
A roll-forward of troubled debt restructuring during the three months ended September 30, 2014 (dollars in thousands): | |||||||||||||||||||||||||||||
Commercial, | One to four | Consumer and | |||||||||||||||||||||||||||
Commercial | Financial and | Commercial | family residential | Consumer | |||||||||||||||||||||||||
Real Estate | Agricultural | Construction | real estate | Construction | Total | ||||||||||||||||||||||||
ACCRUING | |||||||||||||||||||||||||||||
Beginning balance | $ | 1,007 | $ | 1,186 | $ | 858 | $ | 98 | $ | — | $ | 3,149 | |||||||||||||||||
Principal payments | — | — | (3 | ) | (1 | ) | — | (4 | ) | ||||||||||||||||||||
Charge-offs | — | — | — | — | — | — | |||||||||||||||||||||||
Advances | — | — | — | — | — | — | |||||||||||||||||||||||
New restructured | — | — | — | — | — | — | |||||||||||||||||||||||
Transferred out of TDR | — | — | — | — | — | — | |||||||||||||||||||||||
Transfers to nonaccrual | — | — | — | — | — | — | |||||||||||||||||||||||
Ending Balance | $ | 1,007 | $ | 1,186 | $ | 855 | $ | 97 | $ | — | $ | 3,145 | |||||||||||||||||
NONACCRUAL | |||||||||||||||||||||||||||||
Beginning balance | $ | — | $ | 508 | $ | — | $ | 89 | $ | — | $ | 597 | |||||||||||||||||
Principal payments | — | — | — | — | — | — | |||||||||||||||||||||||
Charge-offs | — | — | — | — | — | — | |||||||||||||||||||||||
Advances | — | — | — | — | — | — | |||||||||||||||||||||||
New restructured | — | — | — | — | — | — | |||||||||||||||||||||||
Transfers to foreclosed properties | — | — | — | — | — | — | |||||||||||||||||||||||
Transfers from accruing | — | — | — | — | — | — | |||||||||||||||||||||||
Ending Balance | $ | — | $ | 508 | $ | — | $ | 89 | $ | — | $ | 597 | |||||||||||||||||
TOTALS | |||||||||||||||||||||||||||||
Beginning balance | $ | 1,007 | $ | 1,694 | $ | 858 | $ | 187 | $ | — | $ | 3,746 | |||||||||||||||||
Principal payments | — | — | (3 | ) | (1 | ) | — | (4 | ) | ||||||||||||||||||||
Charge-offs | — | — | — | — | — | — | |||||||||||||||||||||||
Advances | — | — | — | — | — | — | |||||||||||||||||||||||
New restructured | — | — | — | — | — | — | |||||||||||||||||||||||
Transfers out of TDRs | — | — | — | — | — | — | |||||||||||||||||||||||
Tansfers to nonaccrual | — | — | — | — | — | — | |||||||||||||||||||||||
Transfers to foreclosed properties | — | — | — | — | — | — | |||||||||||||||||||||||
Transfers from accruing | — | — | — | — | — | — | |||||||||||||||||||||||
Ending Balance | $ | 1,007 | $ | 1,694 | $ | 855 | $ | 186 | $ | — | $ | 3,742 | |||||||||||||||||
A roll-forward of troubled debt restructuring during the three months ended September 30, 2013 (dollars in thousands): | |||||||||||||||||||||||||||||
Commercial, | One to four | Consumer and | |||||||||||||||||||||||||||
Commercial | Financial and | Commercial | family residential | Consumer | |||||||||||||||||||||||||
Real Estate | Agricultural | Construction | real estate | Construction | Total | ||||||||||||||||||||||||
ACCRUING | |||||||||||||||||||||||||||||
Beginning balance | $ | 3,563 | $ | 2,174 | $ | 858 | $ | 100 | $ | — | $ | 6,695 | |||||||||||||||||
Principal payments | (20 | ) | (25 | ) | — | (1 | ) | (46 | ) | ||||||||||||||||||||
Charge-offs | — | (400 | ) | — | — | — | (400 | ) | |||||||||||||||||||||
Advances | — | — | — | — | — | — | |||||||||||||||||||||||
New restructured | — | — | — | — | — | — | |||||||||||||||||||||||
Transferred out of TDR | — | — | — | — | — | — | |||||||||||||||||||||||
Transfers to nonaccrual | — | (528 | ) | — | — | — | (528 | ) | |||||||||||||||||||||
Ending Balance | $ | 3,543 | $ | 1,221 | $ | 858 | $ | 99 | $ | — | $ | 5,721 | |||||||||||||||||
NONACCRUAL | |||||||||||||||||||||||||||||
Beginning balance | $ | 2,169 | $ | — | $ | — | $ | 106 | $ | — | $ | 2,275 | |||||||||||||||||
Principal payments | (87 | ) | — | — | (14 | ) | — | (101 | ) | ||||||||||||||||||||
Charge-offs | — | — | — | — | — | — | |||||||||||||||||||||||
Advances | — | — | — | — | — | — | |||||||||||||||||||||||
New restructured | — | — | — | — | — | — | |||||||||||||||||||||||
Transfers to foreclosed properties | — | — | — | — | — | — | |||||||||||||||||||||||
Transfers from accruing | — | 528 | — | — | — | 528 | |||||||||||||||||||||||
Ending Balance | $ | 2,082 | $ | 528 | $ | — | $ | 92 | $ | — | $ | 2,702 | |||||||||||||||||
TOTALS | |||||||||||||||||||||||||||||
Beginning balance | $ | 5,732 | $ | 2,174 | $ | 858 | $ | 206 | $ | — | $ | 8,970 | |||||||||||||||||
Principal payments | (107 | ) | (25 | ) | — | (15 | ) | — | (147 | ) | |||||||||||||||||||
Charge-offs | — | (400 | ) | — | — | — | (400 | ) | |||||||||||||||||||||
Advances | — | — | — | — | — | — | |||||||||||||||||||||||
New restructured | — | — | — | — | — | — | |||||||||||||||||||||||
Transfers out of TDRs | — | — | — | — | — | — | |||||||||||||||||||||||
Tansfers to nonaccrual | — | (528 | ) | — | — | — | (528 | ) | |||||||||||||||||||||
Transfers to foreclosed properties | — | — | — | — | — | — | |||||||||||||||||||||||
Transfers from accruing | — | 528 | — | — | — | 528 | |||||||||||||||||||||||
Ending Balance | $ | 5,625 | $ | 1,749 | $ | 858 | $ | 191 | $ | — | $ | 8,423 | |||||||||||||||||
A roll-forward of troubled debt restructuring during the nine months ended September 30, 2014 (dollars in thousands): | |||||||||||||||||||||||||||||
Commercial, | One to four | Consumer and | |||||||||||||||||||||||||||
Commercial | Financial and | Commercial | family residential | Consumer | |||||||||||||||||||||||||
Real Estate | Agricultural | Construction | real estate | Construction | Total | ||||||||||||||||||||||||
ACCRUING | |||||||||||||||||||||||||||||
Beginning balance | $ | 3,520 | $ | 1,186 | $ | 858 | $ | 99 | $ | — | $ | 5,663 | |||||||||||||||||
Principal payments | (2,513 | ) | — | (3 | ) | (4 | ) | — | (2,520 | ) | |||||||||||||||||||
Charge-offs | — | — | — | — | — | — | |||||||||||||||||||||||
Advances | — | — | — | — | — | — | |||||||||||||||||||||||
New restructured | — | — | — | — | — | — | |||||||||||||||||||||||
Transferred out of TDRs | — | — | — | 91 | — | 91 | |||||||||||||||||||||||
Transfers to nonaccrual | — | — | — | (89 | ) | — | (89 | ) | |||||||||||||||||||||
Ending Balance | $ | 1,007 | $ | 1,186 | $ | 855 | $ | 97 | $ | — | $ | 3,145 | |||||||||||||||||
NONACCRUAL | |||||||||||||||||||||||||||||
Beginning balance | $ | — | $ | 523 | $ | — | $ | 91 | $ | — | $ | 614 | |||||||||||||||||
Principal payments | — | (15 | ) | — | — | — | (15 | ) | |||||||||||||||||||||
Charge-offs | — | — | — | — | — | — | |||||||||||||||||||||||
Advances | — | — | — | — | — | — | |||||||||||||||||||||||
New restructured | — | — | — | — | — | — | |||||||||||||||||||||||
Transfers to foreclosed properties | — | — | — | (91 | ) | — | (91 | ) | |||||||||||||||||||||
Transfers from accruing | — | — | — | 89 | — | 89 | |||||||||||||||||||||||
Ending Balance | $ | — | $ | 508 | $ | — | $ | 89 | $ | — | $ | 597 | |||||||||||||||||
TOTALS | |||||||||||||||||||||||||||||
Beginning balance | $ | 3,520 | $ | 1,709 | $ | 858 | $ | 190 | $ | — | $ | 6,277 | |||||||||||||||||
Principal payments | (2,513 | ) | (15 | ) | (3 | ) | (4 | ) | — | (2,535 | ) | ||||||||||||||||||
Charge-offs | — | — | — | — | — | — | |||||||||||||||||||||||
Advances | — | — | — | — | — | — | |||||||||||||||||||||||
New restructured | — | — | — | — | — | — | |||||||||||||||||||||||
Transfers out of TDR | — | — | — | 91 | — | 91 | |||||||||||||||||||||||
Transfers to nonaccrual | — | — | — | (89 | ) | — | (89 | ) | |||||||||||||||||||||
Transfers to foreclosed properties | — | — | — | 89 | — | 89 | |||||||||||||||||||||||
Transfer from accruing | — | — | — | (91 | ) | — | (91 | ) | |||||||||||||||||||||
Ending Balance | $ | 1,007 | $ | 1,694 | $ | 855 | $ | 186 | $ | — | $ | 3,742 | |||||||||||||||||
A roll-forward of troubled debt restructuring during the nine months ended September 30, 2013 (dollars in thousands): | |||||||||||||||||||||||||||||
Commercial, | One to four | Consumer and | |||||||||||||||||||||||||||
Commercial | Financial and | Commercial | family residential | Consumer | |||||||||||||||||||||||||
Real Estate | Agricultural | Construction | real estate | Construction | Total | ||||||||||||||||||||||||
ACCRUING | |||||||||||||||||||||||||||||
Beginning balance | $ | 3,611 | $ | 1,221 | $ | 858 | $ | 102 | $ | — | $ | 5,792 | |||||||||||||||||
Principal payments | (68 | ) | (25 | ) | — | (3 | ) | — | (96 | ) | |||||||||||||||||||
Charge-offs | — | (400 | ) | — | — | — | (400 | ) | |||||||||||||||||||||
Advances | — | — | — | — | — | — | |||||||||||||||||||||||
New restructured | — | 953 | — | — | — | 953 | |||||||||||||||||||||||
Transferred out of TDRs | — | — | — | — | — | — | |||||||||||||||||||||||
Transfers to nonaccrual | — | (528 | ) | — | — | — | (528 | ) | |||||||||||||||||||||
Ending Balance | $ | 3,543 | $ | 1,221 | $ | 858 | $ | 99 | $ | — | $ | 5,721 | |||||||||||||||||
NONACCRUAL | |||||||||||||||||||||||||||||
Beginning balance | $ | 2,162 | $ | — | $ | — | $ | 102 | $ | — | $ | 2,264 | |||||||||||||||||
Principal payments | (87 | ) | — | — | (14 | ) | — | (101 | ) | ||||||||||||||||||||
Charge-offs | — | — | — | — | — | — | |||||||||||||||||||||||
Advances | — | — | — | — | — | — | |||||||||||||||||||||||
New restructured | 7 | — | — | 4 | — | 11 | |||||||||||||||||||||||
Transfers to foreclosed properties | — | — | — | — | — | — | |||||||||||||||||||||||
Transfers from accruing | — | 528 | — | — | — | 528 | |||||||||||||||||||||||
Ending Balance | $ | 2,082 | $ | 528 | $ | — | $ | 92 | $ | — | $ | 2,702 | |||||||||||||||||
TOTALS | |||||||||||||||||||||||||||||
Beginning balance | $ | 5,773 | $ | 1,221 | $ | 858 | $ | 204 | $ | — | $ | 8,056 | |||||||||||||||||
Principal payments | (155 | ) | (25 | ) | — | (17 | ) | — | (197 | ) | |||||||||||||||||||
Charge-offs | — | (400 | ) | — | — | — | (400 | ) | |||||||||||||||||||||
Advances | — | — | — | — | — | — | |||||||||||||||||||||||
New restructured | 7 | 953 | — | 4 | — | 964 | |||||||||||||||||||||||
Transfers out of TDR | — | — | — | — | — | — | |||||||||||||||||||||||
Transfers to nonaccrual | — | (528 | ) | — | — | — | (528 | ) | |||||||||||||||||||||
Transfers to foreclosed properties | — | 528 | — | — | — | 528 | |||||||||||||||||||||||
Transfer from accruing | — | — | — | — | — | — | |||||||||||||||||||||||
Ending Balance | $ | 5,625 | $ | 1,749 | $ | 858 | $ | 191 | $ | — | $ | 8,423 | |||||||||||||||||
A roll-forward of troubled debt restructuring during the year ended December 31, 2013 (dollars in thousands): | |||||||||||||||||||||||||||||
Commercial, | One to four | Consumer and | |||||||||||||||||||||||||||
Commercial | Financial and | Commercial | family residential | Consumer | |||||||||||||||||||||||||
Real Estate | Agricultural | Construction | real estate | Construction | Total | ||||||||||||||||||||||||
ACCRUING | |||||||||||||||||||||||||||||
Beginning balance | $ | 3,611 | $ | 1,221 | $ | 858 | $ | 102 | $ | — | $ | 5,792 | |||||||||||||||||
Principal payments | (91 | ) | (460 | ) | (3 | ) | — | (554 | ) | ||||||||||||||||||||
Charge-offs | — | — | — | — | — | ||||||||||||||||||||||||
Advances | — | — | — | — | — | ||||||||||||||||||||||||
New restructured | — | 953 | — | — | 953 | ||||||||||||||||||||||||
Transferred out of TDR | — | — | — | — | — | ||||||||||||||||||||||||
Transfers to nonaccrual | — | (528 | ) | — | — | (528 | ) | ||||||||||||||||||||||
Ending Balance | $ | 3,520 | $ | 1,186 | $ | 858 | $ | 99 | $ | — | $ | 5,663 | |||||||||||||||||
NONACCRUAL | |||||||||||||||||||||||||||||
Beginning balance | $ | 2,162 | $ | — | $ | — | $ | 102 | $ | — | $ | 2,264 | |||||||||||||||||
— | |||||||||||||||||||||||||||||
Principal payments | (1,376 | ) | (5 | ) | — | (15 | ) | — | (1,396 | ) | |||||||||||||||||||
Charge-offs | (793 | ) | — | — | — | — | (793 | ) | |||||||||||||||||||||
Advances | — | — | — | — | — | — | |||||||||||||||||||||||
New restructured | 7 | 528 | — | 4 | — | 539 | |||||||||||||||||||||||
Transfers to foreclosed properties | — | — | — | — | — | — | |||||||||||||||||||||||
Transfers from accruing | — | — | — | — | — | — | |||||||||||||||||||||||
Ending Balance | $ | — | $ | 523 | $ | — | $ | 91 | $ | — | $ | 614 | |||||||||||||||||
TOTALS | |||||||||||||||||||||||||||||
Beginning balance | $ | 5,773 | $ | 1,221 | $ | 858 | $ | 204 | $ | — | $ | 8,056 | |||||||||||||||||
Principal payments | (1,467 | ) | (465 | ) | — | (18 | ) | — | (1,950 | ) | |||||||||||||||||||
Charge-offs | (793 | ) | — | — | — | — | (793 | ) | |||||||||||||||||||||
Advances | — | — | — | — | — | — | |||||||||||||||||||||||
New restructured | 7 | 1,481 | — | 4 | — | 1,492 | |||||||||||||||||||||||
Transfers out of TDRs | — | — | — | — | — | — | |||||||||||||||||||||||
Tansfers to nonaccrual | — | (528 | ) | — | — | — | (528 | ) | |||||||||||||||||||||
Transfers to foreclosed properties | — | — | — | — | — | — | |||||||||||||||||||||||
Transfers from accruing | — | — | — | — | — | — | |||||||||||||||||||||||
Ending Balance | $ | 3,520 | $ | 1,709 | $ | 858 | $ | 190 | $ | — | $ | 6,277 | |||||||||||||||||
Schedule of activity in insider loans granted to the entity's executive officers and directors, including their families and firms | ' | ||||||||||||||||||||||||||||
Activity in such loans is summarized below (dollars in thousands): | |||||||||||||||||||||||||||||
September 30, | December 31, | September 30, | |||||||||||||||||||||||||||
2014 | 2013 | 2013 | |||||||||||||||||||||||||||
Loans outstanding, beginning of period | $ | 9,043 | $ | 11,297 | $ | 11,297 | |||||||||||||||||||||||
New loans | 33 | 496 | 496 | ||||||||||||||||||||||||||
Net activity on revolving lines of credit | 1,052 | (266 | ) | (263 | ) | ||||||||||||||||||||||||
Principal payments | (1,614 | ) | (2,484 | ) | (1,442 | ) | |||||||||||||||||||||||
Loans outstanding, end of period | $ | 8,514 | $ | 9,043 | $ | 10,088 | |||||||||||||||||||||||
MORTGAGE_SERVICING_RIGHTS_Tabl
MORTGAGE SERVICING RIGHTS (Tables) | 9 Months Ended | ||||||||||
Sep. 30, 2014 | |||||||||||
MORTGAGE SERVICING RIGHTS | ' | ||||||||||
Summary of mortgage servicing rights capitalized and amortized, along with the aggregate activity in related valuation allowances | ' | ||||||||||
The following summarizes mortgage servicing rights capitalized and amortized, along with the aggregate activity in related valuation allowances (dollars in thousands): | |||||||||||
Nine months ended | Year ended | Nine months ended | |||||||||
September 30, | December 31, | September 30, | |||||||||
2014 | 2013 | 2013 | |||||||||
Balance at beginning of period | $ | 1,129 | $ | 638 | $ | 638 | |||||
Additions from loans sold with servicing retained | 375 | 675 | 325 | ||||||||
Amortization | (218 | ) | (184 | ) | (129 | ) | |||||
Estimated Valuation of MSRs at end of period | $ | 1,286 | $ | 1,129 | $ | 834 | |||||
BORROWINGS_Tables
BORROWINGS (Tables) | 9 Months Ended | ||||||||||
Sep. 30, 2014 | |||||||||||
BORROWINGS | ' | ||||||||||
Schedule of borrowings | ' | ||||||||||
Borrowings consist of the following at September 30, 2014, December 31, 2013 and September 30, 2013 (dollars in thousands): | |||||||||||
September 30, | December 31, | September 30, | |||||||||
2014 | 2013 | 2013 | |||||||||
Federal Home Loan Bank fixed rate advances at September 30, 2014 with a weighted average rate of 1.82% maturing in 2014, 2016 and 2018 | $ | 35,000 | $ | 35,000 | $ | 35,000 | |||||
Correspondent bank line of credit - holding company | 4,500 | 2,000 | — | ||||||||
Bank line of credit - wholly-owned asset based lending subsidiary | 1,830 | — | — | ||||||||
Correspondent bank term note, current floor rate of 4%, maturing December 28, 2017 | 2,800 | — | — | ||||||||
USDA Rural Development, fixed-rate note payable, maturing August 24, 2024, interest payable at 1% | 779 | 852 | 852 | ||||||||
$ | 44,909 | $ | 37,852 | $ | 35,852 | ||||||
STOCK_COMPENSATION_PLANS_Table
STOCK COMPENSATION PLANS (Tables) | 9 Months Ended | ||||||||||
Sep. 30, 2014 | |||||||||||
STOCK COMPENSATION PLANS | ' | ||||||||||
Summary of stock option transactions | ' | ||||||||||
September 30, | December 31, | September 30, | |||||||||
2014 | 2013 | 2013 | |||||||||
Outstanding shares at beginning of year | 237,152 | 242,152 | 242,152 | ||||||||
Granted during the period | — | — | — | ||||||||
Exercised during the period | — | — | — | ||||||||
Expired / forfeited during the period | — | — | (5,000 | ) | |||||||
Surrendered/Echanged for restricted stock | — | (5,000 | ) | — | |||||||
Outstanding shares at end of period | 237,152 | 237,152 | 237,152 | ||||||||
Exercisable shares at end of period | 124,861 | 124,861 | 125,861 | ||||||||
Weighted average exercise price per share at end of period | $ | 9.8 | $ | 9.8 | $ | 9.88 | |||||
Shares available for grant at end of period | — | — | — | ||||||||
Summary of the options outstanding and exercisable | ' | ||||||||||
Weighted Average | |||||||||||
Exercise | Number | Remaining | |||||||||
Price | Outstanding | Exercisable | Unvested Options | Contractual Life-Years | |||||||
$ | 9.75 | 217,152 | 120,861 | 96,291 | 0.23 | ||||||
$ | 10.65 | 10,000 | 2,000 | 8,000 | 0.79 | ||||||
$ | 12.00 | 10,000 | 2,000 | 8,000 | 2.21 | ||||||
237,152 | 124,861 | 112,291 | 0.34 | ||||||||
FAIR_VALUE_MEASUREMENTS_Tables
FAIR VALUE MEASUREMENTS (Tables) | 9 Months Ended | |||||||||||||||||||||
Sep. 30, 2014 | ||||||||||||||||||||||
FAIR VALUE MEASUREMENTS | ' | |||||||||||||||||||||
Schedule presenting information for financial instruments | ' | |||||||||||||||||||||
The following table presents information for financial instruments at September 30, 2014, December 31, 2013 and September 30, 2013 (dollars in thousands): | ||||||||||||||||||||||
September 30, 2014 | December 31, 2013 | September 30, 2013 | ||||||||||||||||||||
Level in Fair | Carrying | Estimated | Carrying | Estimated | Carrying | Estimated | ||||||||||||||||
Value Hierarchy | Amount | Fair Value | Amount | Fair Value | Amount | Fair Value | ||||||||||||||||
Financial assets: | ||||||||||||||||||||||
Cash and cash equivalents | Level 1 | $ | 22,401 | $ | 22,401 | $ | 18,219 | $ | 18,219 | $ | 22,794 | $ | 22,794 | |||||||||
Interest-bearing deposits | Level 2 | 235 | 235 | 10 | 10 | 10 | 10 | |||||||||||||||
Securities available for sale | Level 2 | 48,742 | 48,742 | 44,388 | 44,388 | 48,096 | 48,096 | |||||||||||||||
Federal Home Loan Bank stock | Level 2 | 3,060 | 3,060 | 3,060 | 3,060 | 3,060 | 3,060 | |||||||||||||||
Net loans | Level 2 | 513,094 | 513,117 | 479,171 | 479,538 | 467,536 | 460,009 | |||||||||||||||
Accrued interest receivable | Level 3 | 1,457 | 1,457 | 1,351 | 1,351 | 1,536 | 1,536 | |||||||||||||||
Total financial assets | $ | 588,989 | $ | 589,012 | $ | 546,199 | $ | 546,566 | $ | 543,032 | $ | 535,505 | ||||||||||
Financial liabilities: | ||||||||||||||||||||||
Deposits | Level 2 | $ | 491,206 | $ | 491,912 | $ | 466,299 | $ | 465,431 | $ | 461,688 | $ | 459,862 | |||||||||
Borrowings | Level 2 | 44,909 | 45,285 | 37,852 | 37,487 | 35,852 | 35,548 | |||||||||||||||
Accrued interest payable | Level 3 | 184 | 184 | 182 | 182 | 200 | 200 | |||||||||||||||
Total financial liabilties | $ | 536,299 | $ | 537,381 | $ | 504,333 | $ | 503,100 | $ | 497,740 | $ | 495,610 | ||||||||||
Schedule of fair values of assets using Level 3 inputs | ' | |||||||||||||||||||||
Assets Measured at Fair Value on a Nonrecurring Basis at September 30, 2014 | ||||||||||||||||||||||
Quoted Prices | Significant | Significant | ||||||||||||||||||||
in Active Markets | Other Observable | Unobservable | Total Losses for | Total Losses for | ||||||||||||||||||
Balance at | for Identical Assets | Inputs | Inputs | Three Months Ended | Nine Months Ended | |||||||||||||||||
(dollars in thousands) | September 30, 2014 | (Level 1) | (Level 2) | (Level 3) | September 30, 2014 | September 30, 2014 | ||||||||||||||||
Assets | ||||||||||||||||||||||
Impaired loans | $ | 2,695 | $ | — | $ | — | $ | 2,695 | $ | 10 | $ | 440 | ||||||||||
Other real estate owned | 1,843 | — | — | 1,843 | 176 | 190 | ||||||||||||||||
$ | 186 | $ | 630 | |||||||||||||||||||
Assets Measured at Fair Value on a Nonrecurring Basis at December 31, 2013 | ||||||||||||||||||||||
Quoted Prices | Significant | Significant | ||||||||||||||||||||
in Active Markets | Other Observable | Unobservable | Total Losses for | |||||||||||||||||||
Balance at | for Identical Assets | Inputs | Inputs | Year Ended | ||||||||||||||||||
(dollars in thousands) | December 31, 2013 | (Level 1) | (Level 2) | (Level 3) | December 31, 2013 | |||||||||||||||||
Assets | ||||||||||||||||||||||
Impaired loans | $ | 2,024 | $ | — | $ | — | $ | 2,024 | $ | 2,075 | ||||||||||||
Other real estate owned | 1,884 | — | — | 1,884 | 265 | |||||||||||||||||
$ | 2,340 | |||||||||||||||||||||
Assets Measured at Fair Value on a Nonrecurring Basis at September 30, 2013 | ||||||||||||||||||||||
Quoted Prices | Significant | Significant | ||||||||||||||||||||
in Active Markets | Other Observable | Unobservable | Total Losses for | Total Losses for | ||||||||||||||||||
Balance at | for Identical Assets | Inputs | Inputs | Three Months Ended | Nine Months Ended | |||||||||||||||||
(dollars in thousands) | September 30, 2013 | (Level 1) | (Level 2) | (Level 3) | September 30, 2013 | September 30, 2013 | ||||||||||||||||
Assets | ||||||||||||||||||||||
Impaired loans | $ | 4,313 | $ | — | $ | — | $ | 4,313 | $ | 531 | $ | 949 | ||||||||||
Other real estate owned | 2,568 | — | — | 2,568 | 57 | 146 | ||||||||||||||||
$ | 588 | $ | 1,095 | |||||||||||||||||||
COMMITMENTS_CONTINGENCIES_AND_1
COMMITMENTS, CONTINGENCIES AND CREDIT RISKS (Tables) | 9 Months Ended | ||||||||||
Sep. 30, 2014 | |||||||||||
COMMITMENTS, CONTINGENCIES, AND CREDIT RISK | ' | ||||||||||
Schedule of commitments | ' | ||||||||||
These commitments are as follows (dollars in thousands): | |||||||||||
September 30, | December 31, | September 30, | |||||||||
2013 | 2013 | 2013 | |||||||||
Commitments to extend credit: | |||||||||||
Variable rate | $ | 54,962 | $ | 36,039 | $ | 32,061 | |||||
Fixed rate | 19,092 | 15,070 | 24,536 | ||||||||
Standby letters of credit - Variable rate | 5,730 | 5,077 | 4,741 | ||||||||
Credit card commitments - Fixed rate | 3,286 | 3,152 | 3,162 | ||||||||
$ | 83,070 | $ | 59,338 | $ | 64,500 | ||||||
SUMMARY_OF_SIGNIFICANT_ACCOUNT2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) (USD $) | 0 Months Ended | 1 Months Ended | 9 Months Ended | |||
Aug. 31, 2013 | Mar. 31, 2014 | Aug. 31, 2012 | Sep. 30, 2014 | 22-May-12 | 22-May-12 | |
RSUs | RSUs | RSUs | RSUs | 2012 Incentive Compensation Plan | 2012 Incentive Compensation Plan | |
Stock Options | ||||||
Stock Compensation Plans | ' | ' | ' | ' | ' | ' |
Number of RSUs granted (in shares) | 37,125 | 52,774 | 148,500 | ' | ' | ' |
Purchase price (in dollars per share) | ' | $12.95 | $7.91 | $12.95 | ' | ' |
Cost to the employee | ' | ' | ' | $0 | ' | ' |
Vesting period | ' | '4 years | '4 years | '4 years | ' | ' |
Recognition period of compensation cost to be recognized | ' | ' | ' | '4 years | ' | ' |
Compensation cost to be recognized | ' | 683,000 | 1,175,000 | 683,000 | ' | ' |
Number of RSUs unvested (in shares) | ' | ' | ' | 127,024 | ' | ' |
Compensation cost to be recognized | ' | ' | ' | $1,154,000 | ' | ' |
Total authorized share balance | ' | ' | ' | ' | 575,000 | 392,152 |
EARNINGS_PER_SHARE_Details
EARNINGS PER SHARE (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 |
(Numerator): | ' | ' | ' | ' |
Net income | $886 | $896 | $2,352 | $2,969 |
Preferred stock dividends and accretion of discount | ' | 50 | ' | 250 |
NET INCOME AVAILABLE TO COMMON SHAREHOLDERS | $886 | $846 | $2,352 | $2,719 |
(Denominator): | ' | ' | ' | ' |
Weighted average shares outstanding - basic | 5,540,200 | 5,562,835 | 5,532,966,000 | 5,559,108,000 |
Effect of dilutive stock options, vesting of restricted stock units, and common stock warrants outstanding (in shares) | 71,722 | ' | 70,268,000 | ' |
Diluted weighted average shares outstanding | 5,611,922 | 5,562,835 | 5,603,234,000 | 5,559,108,000 |
Income per common share: | ' | ' | ' | ' |
Basic (in dollars per share) | $0.16 | $0.15 | $0.43 | $0.49 |
Diluted (in dollars per share) | $0.16 | $0.15 | $0.42 | $0.49 |
INVESTMENT_SECURITIES_Details
INVESTMENT SECURITIES (Details) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2013 |
In Thousands, unless otherwise specified | |||
SECURITIES AVAILABLE FOR SALE | ' | ' | ' |
Amortized Cost | $48,122 | $44,060 | $47,566 |
Gross Unrealized Gains | 893 | 701 | 870 |
Gross Unrealized Losses | -273 | -373 | -340 |
Estimated Fair Value | 48,742 | 44,388 | 48,096 |
US Agencies - MBS | ' | ' | ' |
SECURITIES AVAILABLE FOR SALE | ' | ' | ' |
Amortized Cost | 6,142 | 7,078 | 7,236 |
Gross Unrealized Gains | 241 | 281 | 315 |
Estimated Fair Value | 6,383 | 7,359 | 7,551 |
US Agencies | ' | ' | ' |
SECURITIES AVAILABLE FOR SALE | ' | ' | ' |
Amortized Cost | 22,725 | 15,227 | 16,003 |
Gross Unrealized Gains | 41 | ' | 66 |
Gross Unrealized Losses | -273 | -372 | -336 |
Estimated Fair Value | 22,493 | 14,855 | 15,733 |
Corporate Bonds | ' | ' | ' |
SECURITIES AVAILABLE FOR SALE | ' | ' | ' |
Amortized Cost | 12,621 | 15,862 | 18,451 |
Gross Unrealized Gains | 172 | 218 | 192 |
Gross Unrealized Losses | ' | -1 | -4 |
Estimated Fair Value | 12,793 | 16,079 | 18,639 |
Obligations of states and political subdivisions | ' | ' | ' |
SECURITIES AVAILABLE FOR SALE | ' | ' | ' |
Amortized Cost | 6,383 | 5,893 | 5,876 |
Gross Unrealized Gains | 439 | 202 | 297 |
Estimated Fair Value | 6,822 | 6,095 | 6,173 |
Other | ' | ' | ' |
SECURITIES AVAILABLE FOR SALE | ' | ' | ' |
Amortized Cost | 251 | ' | ' |
Estimated Fair Value | 251 | ' | ' |
FHLB borrowings and customer relationships | ' | ' | ' |
SECURITIES AVAILABLE FOR SALE | ' | ' | ' |
Amortized Cost | 4,167 | ' | ' |
Estimated Fair Value | $4,300 | ' | ' |
LOANS_Details
LOANS (Details) (USD $) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 |
Insider Loans | ' | ' | ' | ' | ' |
Total loans | $518,373 | $472,495 | $518,373 | $472,495 | $483,832 |
Changes in the allowance for loan losses | ' | ' | ' | ' | ' |
Balance at beginning of period | 5,097 | 5,177 | 4,661 | 5,218 | 5,218 |
Recoveries on loans previously charged off | 65 | 54 | 242 | 154 | 200 |
Loans charged off | -70 | -647 | -185 | -1,263 | -2,432 |
Provision | 187 | 375 | 561 | 850 | 1,675 |
Balance at end of period | 5,279 | 4,959 | 5,279 | 4,959 | 4,661 |
Net charge off activity | ' | ' | 57 | 1,109 | ' |
Net charge off activity as percentage of average loans outstanding | ' | ' | ' | 0.32% | ' |
Commercial real estate loans | ' | ' | ' | ' | ' |
Insider Loans | ' | ' | ' | ' | ' |
Total loans | 272,803 | 257,961 | 272,803 | 257,961 | 268,809 |
Changes in the allowance for loan losses | ' | ' | ' | ' | ' |
Balance at beginning of period | 1,630 | 2,661 | 1,849 | 3,267 | 3,267 |
Recoveries on loans previously charged off | 31 | 23 | 105 | 64 | 92 |
Loans charged off | -18 | -132 | -19 | -588 | -1,539 |
Provision | -1 | 3 | -293 | -188 | 29 |
Balance at end of period | 1,642 | 2,555 | 1,642 | 2,555 | 1,849 |
Commercial, financial, and agricultural | ' | ' | ' | ' | ' |
Insider Loans | ' | ' | ' | ' | ' |
Total loans | 98,714 | 79,511 | 98,714 | 79,511 | 79,655 |
Changes in the allowance for loan losses | ' | ' | ' | ' | ' |
Balance at beginning of period | 1,669 | 1,090 | 1,378 | 692 | 692 |
Recoveries on loans previously charged off | 16 | 20 | 75 | 53 | 56 |
Loans charged off | -9 | -476 | -74 | -552 | -632 |
Provision | -153 | 522 | 144 | 963 | 1,262 |
Balance at end of period | 1,523 | 1,156 | 1,523 | 1,156 | 1,378 |
One to four family residential real estate | ' | ' | ' | ' | ' |
Insider Loans | ' | ' | ' | ' | ' |
Total loans | 110,310 | 98,770 | 110,310 | 98,770 | 103,768 |
Changes in the allowance for loan losses | ' | ' | ' | ' | ' |
Balance at beginning of period | 345 | 877 | 516 | 980 | 980 |
Recoveries on loans previously charged off | 4 | 6 | 18 | 17 | 26 |
Loans charged off | -28 | -25 | -44 | -38 | -141 |
Provision | 80 | 44 | -89 | -57 | -349 |
Balance at end of period | 401 | 902 | 401 | 902 | 516 |
Consumer construction | ' | ' | ' | ' | ' |
Insider Loans | ' | ' | ' | ' | ' |
Total loans | 8,729 | 5,734 | 8,729 | 5,734 | 6,895 |
Changes in the allowance for loan losses | ' | ' | ' | ' | ' |
Balance at beginning of period | 15 | ' | 25 | ' | ' |
Recoveries on loans previously charged off | ' | 1 | ' | 1 | 2 |
Provision | 3 | -1 | -7 | -1 | 23 |
Balance at end of period | 18 | ' | 18 | ' | 25 |
Commercial construction | ' | ' | ' | ' | ' |
Insider Loans | ' | ' | ' | ' | ' |
Total loans | 12,242 | 16,054 | 12,242 | 16,054 | 10,904 |
Changes in the allowance for loan losses | ' | ' | ' | ' | ' |
Balance at beginning of period | 40 | 97 | 80 | 125 | 125 |
Recoveries on loans previously charged off | 3 | ' | 9 | 2 | 2 |
Provision | 1 | -16 | -45 | -46 | -47 |
Balance at end of period | 44 | 81 | 44 | 81 | 80 |
Consumer | ' | ' | ' | ' | ' |
Insider Loans | ' | ' | ' | ' | ' |
Total loans | 15,575 | 14,465 | 15,575 | 14,465 | 13,801 |
Changes in the allowance for loan losses | ' | ' | ' | ' | ' |
Balance at beginning of period | 111 | 13 | 148 | ' | ' |
Recoveries on loans previously charged off | 11 | 4 | 35 | 17 | 22 |
Loans charged off | -15 | -14 | -48 | -85 | -120 |
Provision | 1 | 15 | -27 | 86 | 246 |
Balance at end of period | $108 | $18 | $108 | $18 | $148 |
LOANS_Details_2
LOANS (Details 2) (USD $) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 |
Allowance for loan loss reserve: | ' | ' | ' | ' | ' |
Balance at beginning of period | $5,097 | $5,177 | $4,661 | $5,218 | $5,218 |
Charge-offs | -70 | -647 | -185 | -1,263 | -2,432 |
Recoveries | 65 | 54 | 242 | 154 | 200 |
Provision | 187 | 375 | 561 | 850 | 1,675 |
Balance at end of period | 5,279 | 4,959 | 5,279 | 4,959 | 4,661 |
Loans: | ' | ' | ' | ' | ' |
Ending balance | 518,373 | 472,495 | 518,373 | 472,495 | 483,832 |
Ending balance ALLR | -5,279 | -4,959 | -5,279 | -4,959 | -4,661 |
Net loans | 513,094 | 467,536 | 513,094 | 467,536 | 479,171 |
Ending balance ALLR: | ' | ' | ' | ' | ' |
Individually evaluated | 1,615 | 2,479 | 1,615 | 2,479 | 1,111 |
Collectively evaluated | 3,664 | 2,480 | 3,664 | 2,480 | 3,550 |
Total | 5,279 | 4,959 | 5,279 | 4,959 | 4,661 |
Ending balance Loans: | ' | ' | ' | ' | ' |
Individually evaluated | 3,371 | 22,396 | 3,371 | 22,396 | 2,906 |
Collectively evaluated | 515,002 | 450,099 | 515,002 | 450,099 | 480,926 |
Total Loans | 518,373 | 472,495 | 518,373 | 472,495 | 483,832 |
Commercial real estate loans | ' | ' | ' | ' | ' |
Allowance for loan loss reserve: | ' | ' | ' | ' | ' |
Balance at beginning of period | 1,630 | 2,661 | 1,849 | 3,267 | 3,267 |
Charge-offs | -18 | -132 | -19 | -588 | -1,539 |
Recoveries | 31 | 23 | 105 | 64 | 92 |
Provision | -1 | 3 | -293 | -188 | 29 |
Balance at end of period | 1,642 | 2,555 | 1,642 | 2,555 | 1,849 |
Loans: | ' | ' | ' | ' | ' |
Ending balance | 272,803 | 257,961 | 272,803 | 257,961 | 268,809 |
Ending balance ALLR | -1,642 | -2,555 | -1,642 | -2,555 | -1,849 |
Net loans | 271,161 | 255,406 | 271,161 | 255,406 | 266,960 |
Ending balance ALLR: | ' | ' | ' | ' | ' |
Individually evaluated | 312 | 1,407 | 312 | 1,407 | 99 |
Collectively evaluated | 1,330 | 1,148 | 1,330 | 1,148 | 1,750 |
Total | 1,642 | 2,555 | 1,642 | 2,555 | 1,849 |
Ending balance Loans: | ' | ' | ' | ' | ' |
Individually evaluated | 378 | 13,475 | 378 | 13,475 | 649 |
Collectively evaluated | 272,425 | 244,486 | 272,425 | 244,486 | 268,160 |
Total Loans | 272,803 | 257,961 | 272,803 | 257,961 | 268,809 |
Commercial, financial, and agricultural | ' | ' | ' | ' | ' |
Allowance for loan loss reserve: | ' | ' | ' | ' | ' |
Balance at beginning of period | 1,669 | 1,090 | 1,378 | 692 | 692 |
Charge-offs | -9 | -476 | -74 | -552 | -632 |
Recoveries | 16 | 20 | 75 | 53 | 56 |
Provision | -153 | 522 | 144 | 963 | 1,262 |
Balance at end of period | 1,523 | 1,156 | 1,523 | 1,156 | 1,378 |
Loans: | ' | ' | ' | ' | ' |
Ending balance | 98,714 | 79,511 | 98,714 | 79,511 | 79,655 |
Ending balance ALLR | -1,523 | -1,156 | -1,523 | -1,156 | -1,378 |
Net loans | 97,191 | 78,355 | 97,191 | 78,355 | 78,277 |
Ending balance ALLR: | ' | ' | ' | ' | ' |
Individually evaluated | 1,104 | 802 | 1,104 | 802 | 891 |
Collectively evaluated | 419 | 354 | 419 | 354 | 487 |
Total | 1,523 | 1,156 | 1,523 | 1,156 | 1,378 |
Ending balance Loans: | ' | ' | ' | ' | ' |
Individually evaluated | 1,730 | 7,638 | 1,730 | 7,638 | 1,830 |
Collectively evaluated | 96,984 | 71,873 | 96,984 | 71,873 | 77,825 |
Total Loans | 98,714 | 79,511 | 98,714 | 79,511 | 79,655 |
Commercial construction | ' | ' | ' | ' | ' |
Allowance for loan loss reserve: | ' | ' | ' | ' | ' |
Balance at beginning of period | 40 | 97 | 80 | 125 | 125 |
Recoveries | 3 | ' | 9 | 2 | 2 |
Provision | 1 | -16 | -45 | -46 | -47 |
Balance at end of period | 44 | 81 | 44 | 81 | 80 |
Loans: | ' | ' | ' | ' | ' |
Ending balance | 12,242 | 16,054 | 12,242 | 16,054 | 10,904 |
Ending balance ALLR | -44 | -81 | -44 | -81 | -80 |
Net loans | 12,198 | 15,973 | 12,198 | 15,973 | 10,824 |
Ending balance ALLR: | ' | ' | ' | ' | ' |
Individually evaluated | ' | 6 | ' | 6 | ' |
Collectively evaluated | 44 | 75 | 44 | 75 | 80 |
Total | 44 | 81 | 44 | 81 | 80 |
Ending balance Loans: | ' | ' | ' | ' | ' |
Individually evaluated | ' | 798 | ' | 798 | ' |
Collectively evaluated | 12,242 | 15,256 | 12,242 | 15,256 | 10,904 |
Total Loans | 12,242 | 16,054 | 12,242 | 16,054 | 10,904 |
One to four family residential real estate | ' | ' | ' | ' | ' |
Allowance for loan loss reserve: | ' | ' | ' | ' | ' |
Balance at beginning of period | 345 | 877 | 516 | 980 | 980 |
Charge-offs | -28 | -25 | -44 | -38 | -141 |
Recoveries | 4 | 6 | 18 | 17 | 26 |
Provision | 80 | 44 | -89 | -57 | -349 |
Balance at end of period | 401 | 902 | 401 | 902 | 516 |
Loans: | ' | ' | ' | ' | ' |
Ending balance | 110,310 | 98,770 | 110,310 | 98,770 | 103,768 |
Ending balance ALLR | -401 | -902 | -401 | -902 | -516 |
Net loans | 109,909 | 97,868 | 109,909 | 97,868 | 103,252 |
Ending balance ALLR: | ' | ' | ' | ' | ' |
Individually evaluated | 167 | 246 | 167 | 246 | 103 |
Collectively evaluated | 234 | 656 | 234 | 656 | 413 |
Total | 401 | 902 | 401 | 902 | 516 |
Ending balance Loans: | ' | ' | ' | ' | ' |
Individually evaluated | 1,202 | 450 | 1,202 | 450 | 385 |
Collectively evaluated | 109,108 | 98,320 | 109,108 | 98,320 | 103,383 |
Total Loans | 110,310 | 98,770 | 110,310 | 98,770 | 103,768 |
Consumer construction | ' | ' | ' | ' | ' |
Allowance for loan loss reserve: | ' | ' | ' | ' | ' |
Balance at beginning of period | 15 | ' | 25 | ' | ' |
Recoveries | ' | 1 | ' | 1 | 2 |
Provision | 3 | -1 | -7 | -1 | 23 |
Balance at end of period | 18 | ' | 18 | ' | 25 |
Loans: | ' | ' | ' | ' | ' |
Ending balance | 8,729 | 5,734 | 8,729 | 5,734 | 6,895 |
Ending balance ALLR | -18 | ' | -18 | ' | -25 |
Net loans | 8,711 | 5,734 | 8,711 | 5,734 | 6,870 |
Ending balance ALLR: | ' | ' | ' | ' | ' |
Collectively evaluated | 18 | ' | 18 | ' | 25 |
Total | 18 | ' | 18 | ' | 25 |
Ending balance Loans: | ' | ' | ' | ' | ' |
Collectively evaluated | 8,729 | 5,734 | 8,729 | 5,734 | 6,895 |
Total Loans | 8,729 | 5,734 | 8,729 | 5,734 | 6,895 |
Consumer | ' | ' | ' | ' | ' |
Allowance for loan loss reserve: | ' | ' | ' | ' | ' |
Balance at beginning of period | 111 | 13 | 148 | ' | ' |
Charge-offs | -15 | -14 | -48 | -85 | -120 |
Recoveries | 11 | 4 | 35 | 17 | 22 |
Provision | 1 | 15 | -27 | 86 | 246 |
Balance at end of period | 108 | 18 | 108 | 18 | 148 |
Loans: | ' | ' | ' | ' | ' |
Ending balance | 15,575 | 14,465 | 15,575 | 14,465 | 13,801 |
Ending balance ALLR | -108 | -18 | -108 | -18 | -148 |
Net loans | 15,467 | 14,447 | 15,467 | 14,447 | 13,653 |
Ending balance ALLR: | ' | ' | ' | ' | ' |
Individually evaluated | 32 | 18 | 32 | 18 | 18 |
Collectively evaluated | 76 | ' | 76 | ' | 130 |
Total | 108 | 18 | 108 | 18 | 148 |
Ending balance Loans: | ' | ' | ' | ' | ' |
Individually evaluated | 61 | 35 | 61 | 35 | 42 |
Collectively evaluated | 15,514 | 14,430 | 15,514 | 14,430 | 13,759 |
Total Loans | 15,575 | 14,465 | 15,575 | 14,465 | 13,801 |
Unallocated | ' | ' | ' | ' | ' |
Allowance for loan loss reserve: | ' | ' | ' | ' | ' |
Balance at beginning of period | 1,287 | 439 | 665 | 154 | 154 |
Provision | 256 | -192 | 878 | 93 | 511 |
Balance at end of period | 1,543 | 247 | 1,543 | 247 | 665 |
Loans: | ' | ' | ' | ' | ' |
Ending balance ALLR | -1,543 | -247 | -1,543 | -247 | -665 |
Net loans | -1,543 | -247 | -1,543 | -247 | -665 |
Ending balance ALLR: | ' | ' | ' | ' | ' |
Collectively evaluated | 1,543 | 247 | 1,543 | 247 | 665 |
Total | $1,543 | $247 | $1,543 | $247 | $665 |
LOANS_Details_3
LOANS (Details 3) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2013 |
In Thousands, unless otherwise specified | |||
Breakdown of loans by risk category | ' | ' | ' |
Total loans | $518,373 | $483,832 | $472,495 |
Minimum | ' | ' | ' |
Breakdown of loans by risk category | ' | ' | ' |
Credit risk rating for which reserves are established if no specific reserves made | 6 | ' | ' |
Maximum | ' | ' | ' |
Breakdown of loans by risk category | ' | ' | ' |
Credit risk rating for which general reserves are established | 5 | ' | ' |
Credit risk rating for which reserves are established if no specific reserves made | 7 | ' | ' |
Commercial real estate loans | ' | ' | ' |
Breakdown of loans by risk category | ' | ' | ' |
Total loans | 272,803 | 268,809 | 257,961 |
Commercial, financial, and agricultural | ' | ' | ' |
Breakdown of loans by risk category | ' | ' | ' |
Total loans | 98,714 | 79,655 | 79,511 |
Commercial construction | ' | ' | ' |
Breakdown of loans by risk category | ' | ' | ' |
Total loans | 12,242 | 10,904 | 16,054 |
One to four family residential real estate | ' | ' | ' |
Breakdown of loans by risk category | ' | ' | ' |
Total loans | 110,310 | 103,768 | 98,770 |
Consumer construction | ' | ' | ' |
Breakdown of loans by risk category | ' | ' | ' |
Total loans | 8,729 | 6,895 | 5,734 |
Consumer | ' | ' | ' |
Breakdown of loans by risk category | ' | ' | ' |
Total loans | 15,575 | 13,801 | 14,465 |
Strong (1) | ' | ' | ' |
Breakdown of loans by risk category | ' | ' | ' |
Total loans | 3,477 | 5,534 | 6,500 |
Strong (1) | Commercial real estate loans | ' | ' | ' |
Breakdown of loans by risk category | ' | ' | ' |
Total loans | 1,741 | 1,502 | 2,240 |
Strong (1) | Commercial, financial, and agricultural | ' | ' | ' |
Breakdown of loans by risk category | ' | ' | ' |
Total loans | 1,736 | 3,741 | 4,260 |
Strong (1) | Commercial construction | ' | ' | ' |
Breakdown of loans by risk category | ' | ' | ' |
Total loans | ' | 30 | ' |
Strong (1) | One to four family residential real estate | ' | ' | ' |
Breakdown of loans by risk category | ' | ' | ' |
Total loans | ' | 251 | ' |
Strong (1) | Consumer | ' | ' | ' |
Breakdown of loans by risk category | ' | ' | ' |
Total loans | ' | 10 | ' |
Good (2) | ' | ' | ' |
Breakdown of loans by risk category | ' | ' | ' |
Total loans | 30,038 | 31,211 | 31,512 |
Good (2) | Commercial real estate loans | ' | ' | ' |
Breakdown of loans by risk category | ' | ' | ' |
Total loans | 24,827 | 23,310 | 23,675 |
Good (2) | Commercial, financial, and agricultural | ' | ' | ' |
Breakdown of loans by risk category | ' | ' | ' |
Total loans | 4,472 | 4,348 | 5,108 |
Good (2) | Commercial construction | ' | ' | ' |
Breakdown of loans by risk category | ' | ' | ' |
Total loans | 444 | 479 | 676 |
Good (2) | One to four family residential real estate | ' | ' | ' |
Breakdown of loans by risk category | ' | ' | ' |
Total loans | 295 | 3,074 | 1,951 |
Good (2) | Consumer | ' | ' | ' |
Breakdown of loans by risk category | ' | ' | ' |
Total loans | ' | ' | 102 |
Average (3) | ' | ' | ' |
Breakdown of loans by risk category | ' | ' | ' |
Total loans | 153,796 | 148,171 | 117,871 |
Average (3) | Commercial real estate loans | ' | ' | ' |
Breakdown of loans by risk category | ' | ' | ' |
Total loans | 116,621 | 116,702 | 88,105 |
Average (3) | Commercial, financial, and agricultural | ' | ' | ' |
Breakdown of loans by risk category | ' | ' | ' |
Total loans | 34,547 | 27,455 | 22,263 |
Average (3) | Commercial construction | ' | ' | ' |
Breakdown of loans by risk category | ' | ' | ' |
Total loans | 1,578 | 2,702 | 5,283 |
Average (3) | One to four family residential real estate | ' | ' | ' |
Breakdown of loans by risk category | ' | ' | ' |
Total loans | 1,046 | 1,275 | 2,186 |
Average (3) | Consumer | ' | ' | ' |
Breakdown of loans by risk category | ' | ' | ' |
Total loans | 4 | 37 | 34 |
Acceptable/Acceptable Watch (4) | ' | ' | ' |
Breakdown of loans by risk category | ' | ' | ' |
Total loans | 192,512 | 172,945 | 176,545 |
Acceptable/Acceptable Watch (4) | Commercial real estate loans | ' | ' | ' |
Breakdown of loans by risk category | ' | ' | ' |
Total loans | 128,126 | 125,010 | 123,373 |
Acceptable/Acceptable Watch (4) | Commercial, financial, and agricultural | ' | ' | ' |
Breakdown of loans by risk category | ' | ' | ' |
Total loans | 53,311 | 39,070 | 41,851 |
Acceptable/Acceptable Watch (4) | Commercial construction | ' | ' | ' |
Breakdown of loans by risk category | ' | ' | ' |
Total loans | 6,935 | 4,340 | 6,167 |
Acceptable/Acceptable Watch (4) | One to four family residential real estate | ' | ' | ' |
Breakdown of loans by risk category | ' | ' | ' |
Total loans | 4,119 | 4,482 | 4,522 |
Acceptable/Acceptable Watch (4) | Consumer | ' | ' | ' |
Breakdown of loans by risk category | ' | ' | ' |
Total loans | 21 | 43 | 632 |
Special Mention (5) | ' | ' | ' |
Breakdown of loans by risk category | ' | ' | ' |
Total loans | 60 | ' | 20,616 |
Special Mention (5) | Commercial real estate loans | ' | ' | ' |
Breakdown of loans by risk category | ' | ' | ' |
Total loans | ' | ' | 16,117 |
Special Mention (5) | Commercial, financial, and agricultural | ' | ' | ' |
Breakdown of loans by risk category | ' | ' | ' |
Total loans | ' | ' | 3,746 |
Special Mention (5) | Commercial construction | ' | ' | ' |
Breakdown of loans by risk category | ' | ' | ' |
Total loans | ' | ' | 753 |
Special Mention (5) | One to four family residential real estate | ' | ' | ' |
Breakdown of loans by risk category | ' | ' | ' |
Total loans | 60 | ' | ' |
Substandard (6) | ' | ' | ' |
Breakdown of loans by risk category | ' | ' | ' |
Total loans | 6,538 | 8,468 | 6,953 |
Substandard (6) | Commercial real estate loans | ' | ' | ' |
Breakdown of loans by risk category | ' | ' | ' |
Total loans | 1,488 | 2,285 | 4,451 |
Substandard (6) | Commercial, financial, and agricultural | ' | ' | ' |
Breakdown of loans by risk category | ' | ' | ' |
Total loans | 4,648 | 5,041 | 2,094 |
Substandard (6) | Commercial construction | ' | ' | ' |
Breakdown of loans by risk category | ' | ' | ' |
Total loans | 402 | 402 | 402 |
Substandard (6) | One to four family residential real estate | ' | ' | ' |
Breakdown of loans by risk category | ' | ' | ' |
Total loans | ' | 710 | 6 |
Substandard (6) | Consumer | ' | ' | ' |
Breakdown of loans by risk category | ' | ' | ' |
Total loans | ' | 30 | ' |
Doubtful (7) | ' | ' | ' |
Breakdown of loans by risk category | ' | ' | ' |
Total loans | ' | ' | 189 |
Doubtful (7) | Commercial, financial, and agricultural | ' | ' | ' |
Breakdown of loans by risk category | ' | ' | ' |
Total loans | ' | ' | 189 |
Rating Unassigned | ' | ' | ' |
Breakdown of loans by risk category | ' | ' | ' |
Total loans | 131,952 | 117,503 | 112,309 |
Rating Unassigned | Commercial construction | ' | ' | ' |
Breakdown of loans by risk category | ' | ' | ' |
Total loans | 2,883 | 2,951 | 2,773 |
Rating Unassigned | One to four family residential real estate | ' | ' | ' |
Breakdown of loans by risk category | ' | ' | ' |
Total loans | 104,790 | 93,976 | 90,105 |
Rating Unassigned | Consumer construction | ' | ' | ' |
Breakdown of loans by risk category | ' | ' | ' |
Total loans | 8,729 | 6,895 | 5,734 |
Rating Unassigned | Consumer | ' | ' | ' |
Breakdown of loans by risk category | ' | ' | ' |
Total loans | $15,550 | $13,681 | $13,697 |
LOANS_Details_4
LOANS (Details 4) (USD $) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 |
Impaired Loans | ' | ' | ' | ' | ' |
Number of days past due to be considered as nonperforming loans | ' | ' | '90 days | ' | ' |
Average investment | ' | ' | ' | ' | ' |
With a valuation reserve | $11 | ' | ' | ' | ' |
Total | 2,610 | 4,536 | 2,143 | 4,407 | 5,999 |
Related Valuation Reserve | 1,478 | 1,555 | 1,478 | 1,555 | 370 |
Interest Income on Accrual Basis | ' | ' | ' | ' | ' |
Total | 40 | 60 | 93 | 177 | 228 |
Nonaccrual Basis | ' | ' | ' | ' | ' |
Recorded investment | ' | ' | ' | ' | ' |
Total | 2,695 | 4,313 | 2,695 | 4,313 | 2,024 |
Commercial real estate loans | ' | ' | ' | ' | ' |
Average investment | ' | ' | ' | ' | ' |
With no valuation reserve | ' | 412 | ' | 501 | 3,045 |
With a valuation reserve | 340 | 2,581 | 427 | 2,557 | 71 |
Total | 340 | 2,993 | 427 | 3,058 | 3,116 |
Related Valuation Reserve | 227 | 1,272 | 227 | 1,272 | 14 |
Interest Income on Accrual Basis | ' | ' | ' | ' | ' |
With no valuation reserve | ' | ' | ' | 26 | 153 |
With a valuation reserve | 4 | 42 | 20 | 102 | 5 |
Total | 4 | 42 | 20 | 128 | 158 |
Commercial real estate loans | Nonaccrual Basis | ' | ' | ' | ' | ' |
Recorded investment | ' | ' | ' | ' | ' |
With no valuation reserve | ' | 238 | ' | 238 | 513 |
With a valuation reserve | 227 | 2,589 | 227 | 2,589 | 59 |
Total | 227 | 2,827 | 227 | 2,827 | 572 |
Commercial, financial, and agricultural | ' | ' | ' | ' | ' |
Average investment | ' | ' | ' | ' | ' |
With no valuation reserve | ' | 147 | ' | 243 | 505 |
With a valuation reserve | 1,770 | 741 | 1,268 | 373 | 834 |
Total | 1,770 | 888 | 1,268 | 616 | 1,339 |
Related Valuation Reserve | 1,104 | 33 | 1,104 | 33 | 265 |
Interest Income on Accrual Basis | ' | ' | ' | ' | ' |
With no valuation reserve | ' | 3 | ' | 9 | 13 |
With a valuation reserve | 28 | 5 | 52 | 11 | 18 |
Total | 28 | 8 | 52 | 20 | 31 |
Commercial, financial, and agricultural | Nonaccrual Basis | ' | ' | ' | ' | ' |
Recorded investment | ' | ' | ' | ' | ' |
With no valuation reserve | ' | ' | ' | ' | 59 |
With a valuation reserve | 1,735 | 767 | 1,735 | 767 | 752 |
Total | 1,735 | 767 | 1,735 | 767 | 811 |
Commercial construction | ' | ' | ' | ' | ' |
Average investment | ' | ' | ' | ' | ' |
With no valuation reserve | ' | ' | ' | 193 | 626 |
Total | ' | ' | ' | 193 | 626 |
Interest Income on Accrual Basis | ' | ' | ' | ' | ' |
With no valuation reserve | ' | ' | ' | 3 | 3 |
Total | ' | ' | ' | 3 | 3 |
One to four family residential real estate | ' | ' | ' | ' | ' |
Average investment | ' | ' | ' | ' | ' |
With no valuation reserve | ' | 86 | ' | 140 | 625 |
With a valuation reserve | 489 | 560 | 434 | 396 | 261 |
Total | 489 | 646 | 434 | 536 | 886 |
Related Valuation Reserve | 147 | 250 | 147 | 250 | 78 |
Interest Income on Accrual Basis | ' | ' | ' | ' | ' |
With no valuation reserve | ' | 2 | ' | 7 | 16 |
With a valuation reserve | 7 | 8 | 20 | 19 | 20 |
Total | 7 | 10 | 20 | 26 | 36 |
One to four family residential real estate | Nonaccrual Basis | ' | ' | ' | ' | ' |
Recorded investment | ' | ' | ' | ' | ' |
With no valuation reserve | ' | 67 | ' | 67 | 361 |
With a valuation reserve | 733 | 642 | 733 | 642 | 250 |
Total | 733 | 709 | 733 | 709 | 611 |
Consumer | ' | ' | ' | ' | ' |
Average investment | ' | ' | ' | ' | ' |
With no valuation reserve | ' | 9 | ' | 4 | 2 |
With a valuation reserve | ' | ' | 14 | ' | 30 |
Total | 11 | 9 | 14 | 4 | 32 |
Related Valuation Reserve | ' | ' | ' | ' | 13 |
Interest Income on Accrual Basis | ' | ' | ' | ' | ' |
With a valuation reserve | 1 | ' | 1 | ' | ' |
Total | 1 | ' | 1 | ' | ' |
Consumer | Nonaccrual Basis | ' | ' | ' | ' | ' |
Recorded investment | ' | ' | ' | ' | ' |
With no valuation reserve | ' | 10 | ' | 10 | ' |
With a valuation reserve | ' | ' | ' | ' | 30 |
Total | ' | $10 | ' | $10 | $30 |
LOANS_Details_5
LOANS (Details 5) (USD $) | Sep. 30, 2014 | Jun. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||||||
Past due loans | ' | ' | ' | ' | ' | ' |
30-89 days Past Due (accruing) | $1,370 | ' | $239 | $317 | ' | ' |
90+ days Past Due/Nonaccrual | 2,695 | 2,652 | 2,024 | 4,313 | 3,983 | 4,687 |
Total | 4,065 | ' | 2,263 | 4,630 | ' | ' |
Commercial real estate loans | ' | ' | ' | ' | ' | ' |
Past due loans | ' | ' | ' | ' | ' | ' |
30-89 days Past Due (accruing) | 540 | ' | ' | ' | ' | ' |
90+ days Past Due/Nonaccrual | 227 | 454 | 572 | 2,827 | 3,057 | 3,071 |
Total | 767 | ' | 572 | 2,827 | ' | ' |
Commercial, financial, and agricultural | ' | ' | ' | ' | ' | ' |
Past due loans | ' | ' | ' | ' | ' | ' |
30-89 days Past Due (accruing) | 306 | ' | 4 | 100 | ' | ' |
90+ days Past Due/Nonaccrual | 1,735 | 1,808 | 811 | 767 | 517 | 436 |
Total | 2,041 | ' | 815 | 867 | ' | ' |
Commercial construction | ' | ' | ' | ' | ' | ' |
Past due loans | ' | ' | ' | ' | ' | ' |
30-89 days Past Due (accruing) | 55 | ' | 20 | ' | ' | ' |
90+ days Past Due/Nonaccrual | ' | ' | ' | ' | ' | 675 |
Total | 55 | ' | 20 | ' | ' | ' |
One to four family residential real estate | ' | ' | ' | ' | ' | ' |
Past due loans | ' | ' | ' | ' | ' | ' |
30-89 days Past Due (accruing) | 414 | ' | 201 | 186 | ' | ' |
90+ days Past Due/Nonaccrual | 733 | 383 | 611 | 709 | 400 | 505 |
Total | 1,147 | ' | 812 | 895 | ' | ' |
Consumer | ' | ' | ' | ' | ' | ' |
Past due loans | ' | ' | ' | ' | ' | ' |
30-89 days Past Due (accruing) | 55 | ' | 14 | 31 | ' | ' |
90+ days Past Due/Nonaccrual | ' | 7 | 30 | 10 | 9 | ' |
Total | $55 | ' | $44 | $41 | ' | ' |
LOANS_Details_6
LOANS (Details 6) (USD $) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 |
Roll-forward of nonaccrual activity | ' | ' | ' | ' | ' |
Beginning balance | $2,652 | $3,983 | $2,024 | $4,687 | $4,687 |
Principal payments | -88 | -263 | -297 | -644 | -1,987 |
Charge-offs | -38 | -523 | -119 | -941 | -2,065 |
Transfers to OREO | -207 | -245 | -490 | -932 | -932 |
Transfers from accruing | 371 | 1,312 | 1,687 | 2,085 | 2,259 |
Other | 5 | 49 | 27 | 58 | 62 |
Ending balance | 2,695 | 4,313 | 2,695 | 4,313 | 2,024 |
Commercial real estate loans | ' | ' | ' | ' | ' |
Roll-forward of nonaccrual activity | ' | ' | ' | ' | ' |
Beginning balance | 454 | 3,057 | 572 | 3,071 | 3,071 |
Principal payments | -2 | -26 | -104 | -174 | -1,478 |
Charge-offs | -18 | -23 | -18 | -352 | -1,304 |
Transfers to OREO | -207 | -208 | -233 | -208 | -208 |
Transfers from accruing | ' | ' | ' | 443 | 443 |
Other | ' | 27 | 10 | 47 | 48 |
Ending balance | 227 | 2,827 | 227 | 2,827 | 572 |
Commercial, financial, and agricultural | ' | ' | ' | ' | ' |
Roll-forward of nonaccrual activity | ' | ' | ' | ' | ' |
Beginning balance | 1,808 | 517 | 811 | 436 | 436 |
Principal payments | -79 | -224 | -160 | -292 | -319 |
Charge-offs | -3 | -476 | -56 | -548 | -616 |
Transfers to OREO | ' | -37 | ' | -37 | -37 |
Transfers from accruing | 3 | 966 | 1,142 | 1,207 | 1,346 |
Other | 6 | 21 | 8 | 1 | 1 |
Ending balance | 1,735 | 767 | 1,735 | 767 | 811 |
Commercial construction | ' | ' | ' | ' | ' |
Roll-forward of nonaccrual activity | ' | ' | ' | ' | ' |
Beginning balance | ' | ' | ' | 675 | 675 |
Principal payments | ' | ' | ' | -100 | -100 |
Transfers to OREO | ' | ' | ' | -580 | -580 |
Other | ' | ' | ' | 5 | 5 |
One to four family residential real estate | ' | ' | ' | ' | ' |
Roll-forward of nonaccrual activity | ' | ' | ' | ' | ' |
Beginning balance | 383 | 400 | 611 | 505 | 505 |
Principal payments | -7 | -12 | -29 | -77 | -88 |
Charge-offs | -10 | -24 | -13 | -37 | -141 |
Transfers to OREO | ' | ' | -257 | -107 | -107 |
Transfers from accruing | 368 | 344 | 539 | 420 | 434 |
Other | -1 | 1 | 9 | 5 | 8 |
Ending balance | 733 | 709 | 733 | 709 | 611 |
Consumer | ' | ' | ' | ' | ' |
Roll-forward of nonaccrual activity | ' | ' | ' | ' | ' |
Beginning balance | 7 | 9 | 30 | ' | ' |
Principal payments | ' | -1 | -4 | -1 | -2 |
Charge-offs | -7 | ' | -32 | -4 | -4 |
Transfers from accruing | ' | 2 | 6 | 15 | 36 |
Ending balance | ' | $10 | ' | $10 | $30 |
LOANS_Details_7
LOANS (Details 7) (USD $) | 9 Months Ended | 12 Months Ended |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Dec. 31, 2013 |
item | item | |
Troubled Debt Restructuring | ' | ' |
Number of Modifications | 1 | 1 |
Recorded Investment | $528 | $528 |
Commercial, financial, and agricultural | ' | ' |
Troubled Debt Restructuring | ' | ' |
Number of Modifications | 1 | 1 |
Recorded Investment | $528 | $528 |
LOANS_Details_8
LOANS (Details 8) (USD $) | 3 Months Ended | 9 Months Ended | 12 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | 3 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||||||||||||||||||||||||||||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 | Jun. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 | Jun. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 | Jun. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2013 | Dec. 31, 2013 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 | Jun. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2013 | Dec. 31, 2013 | Sep. 30, 2014 | Jun. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 | Jun. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2013 | Jun. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2013 | Jun. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 | Jun. 30, 2014 |
Accrual Basis | Accrual Basis | Accrual Basis | Accrual Basis | Accrual Basis | Nonaccrual Basis | Nonaccrual Basis | Nonaccrual Basis | Nonaccrual Basis | Nonaccrual Basis | Commercial real estate loans | Commercial real estate loans | Commercial real estate loans | Commercial real estate loans | Commercial real estate loans | Commercial real estate loans | Commercial real estate loans | Commercial real estate loans | Commercial real estate loans | Commercial real estate loans | Commercial real estate loans | Commercial real estate loans | Commercial real estate loans | Commercial, financial, and agricultural | Commercial, financial, and agricultural | Commercial, financial, and agricultural | Commercial, financial, and agricultural | Commercial, financial, and agricultural | Commercial, financial, and agricultural | Commercial, financial, and agricultural | Commercial, financial, and agricultural | Commercial, financial, and agricultural | Commercial, financial, and agricultural | Commercial, financial, and agricultural | Commercial, financial, and agricultural | Commercial, financial, and agricultural | Commercial, financial, and agricultural | Commercial, financial, and agricultural | Commercial construction | Commercial construction | Commercial construction | Commercial construction | Commercial construction | Commercial construction | Commercial construction | Commercial construction | Commercial construction | Commercial construction | One to four family residential real estate | One to four family residential real estate | One to four family residential real estate | One to four family residential real estate | One to four family residential real estate | One to four family residential real estate | One to four family residential real estate | One to four family residential real estate | One to four family residential real estate | One to four family residential real estate | One to four family residential real estate | One to four family residential real estate | One to four family residential real estate | One to four family residential real estate | One to four family residential real estate | ||||||
Accrual Basis | Accrual Basis | Accrual Basis | Accrual Basis | Accrual Basis | Nonaccrual Basis | Nonaccrual Basis | Nonaccrual Basis | Accrual Basis | Accrual Basis | Accrual Basis | Accrual Basis | Accrual Basis | Nonaccrual Basis | Nonaccrual Basis | Nonaccrual Basis | Nonaccrual Basis | Nonaccrual Basis | Accrual Basis | Accrual Basis | Accrual Basis | Accrual Basis | Accrual Basis | Accrual Basis | Accrual Basis | Accrual Basis | Accrual Basis | Accrual Basis | Nonaccrual Basis | Nonaccrual Basis | Nonaccrual Basis | Nonaccrual Basis | Nonaccrual Basis | ||||||||||||||||||||||||||||||||||||
Changes in troubled debt restructuring | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Beginning balance | $3,746 | $8,056 | $6,277 | $8,056 | $8,056 | $3,149 | $6,695 | $5,663 | $5,792 | $5,792 | $2,275 | $614 | $2,264 | $2,264 | $597 | $5,773 | $3,520 | $5,773 | $5,773 | $1,007 | $3,563 | $3,520 | $3,611 | $3,611 | $1,007 | $2,169 | $2,162 | $2,162 | $1,221 | $1,709 | $1,221 | $1,221 | $1,694 | $2,174 | $1,221 | $1,221 | $1,186 | $1,186 | ' | $523 | ' | ' | $508 | $858 | $858 | $858 | $858 | $858 | $858 | $858 | $858 | $858 | $858 | $187 | $204 | $190 | $204 | $204 | $98 | $100 | $99 | $102 | $102 | $106 | $91 | $102 | $102 | $89 |
Principal payments | -4 | -197 | -2,535 | -197 | -1,950 | -4 | -46 | -2,520 | -96 | -554 | -101 | -15 | -101 | -1,396 | ' | -155 | -2,513 | -155 | -1,467 | ' | -20 | -2,513 | -68 | -91 | ' | -87 | -87 | -1,376 | -25 | -15 | -25 | -465 | ' | -25 | -25 | -460 | ' | ' | ' | -15 | ' | -5 | ' | -3 | -3 | ' | ' | ' | -3 | -3 | ' | ' | ' | -1 | -17 | -4 | -17 | -18 | -1 | -1 | -4 | -3 | -3 | -14 | ' | -14 | -15 | ' |
Charge-offs | ' | -400 | ' | -400 | -793 | ' | -400 | ' | -400 | ' | ' | ' | ' | -793 | ' | ' | ' | ' | -793 | ' | ' | ' | ' | ' | ' | ' | ' | -793 | -400 | ' | -400 | ' | ' | -400 | -400 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
New restructured | ' | 964 | ' | 964 | 1,492 | ' | ' | ' | 953 | 953 | ' | ' | 11 | 539 | ' | 7 | ' | 7 | 7 | ' | ' | ' | ' | ' | ' | ' | 7 | 7 | 953 | ' | 953 | 1,481 | ' | ' | 953 | 953 | ' | ' | ' | ' | ' | 528 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 4 | ' | 4 | 4 | ' | ' | ' | ' | ' | ' | ' | 4 | 4 | ' |
Transferred out of TDRs | ' | ' | 91 | ' | ' | ' | ' | 91 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 91 | ' | ' | ' | ' | 91 | ' | ' | ' | ' | ' | ' | ' |
Transfers to nonaccrual | ' | -528 | -89 | -528 | -528 | ' | -528 | -89 | -528 | -528 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | -528 | ' | -528 | -528 | ' | -528 | -528 | -528 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | -89 | ' | ' | ' | ' | -89 | ' | ' | ' | ' | ' | ' | ' |
Transfers to foreclosed properties | ' | ' | 89 | 528 | ' | ' | ' | ' | ' | ' | ' | -91 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 528 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 89 | ' | ' | ' | ' | ' | ' | ' | ' | -91 | ' | ' | ' |
Transfer from accruing | ' | 528 | 91 | ' | ' | ' | ' | ' | ' | ' | 528 | 89 | 528 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 528 | ' | ' | ' | ' | ' | ' | ' | ' | ' | 528 | ' | 528 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 91 | ' | ' | ' | ' | ' | ' | ' | ' | 89 | ' | ' | ' |
Ending balance | $3,742 | $8,423 | $3,742 | $8,423 | $6,277 | $3,145 | $5,721 | $3,145 | $5,721 | $5,663 | $2,702 | $597 | $2,702 | $614 | $597 | $5,625 | $1,007 | $5,625 | $3,520 | $1,007 | $3,543 | $1,007 | $3,543 | $3,520 | $1,007 | $2,082 | $2,082 | ' | $1,749 | $1,694 | $1,749 | $1,709 | $1,694 | $1,221 | $1,221 | $1,186 | $1,186 | $1,186 | $528 | $508 | $528 | $523 | $508 | $855 | $855 | $858 | $858 | $858 | $855 | $855 | $858 | $858 | $858 | $186 | $191 | $186 | $191 | $190 | $97 | $99 | $97 | $99 | $99 | $92 | $89 | $92 | $91 | $89 |
LOANS_Details_9
LOANS (Details 9) (Bank, USD $) | 9 Months Ended | 12 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 |
Activity in insider loans granted to the entity's executive officers and directors, including their families and firms | ' | ' | ' |
Loans outstanding, beginning of period | $9,043 | $11,297 | $11,297 |
New loans | 33 | 496 | 496 |
Net activity on revolving lines of credit | 1,052 | -263 | -266 |
Principal payments | -1,614 | -1,442 | -2,484 |
Loans outstanding, end of period | 8,514 | 10,088 | 9,043 |
Unfunded commitments | 517 | ' | ' |
Substandard (6) | ' | ' | ' |
Activity in insider loans granted to the entity's executive officers and directors, including their families and firms | ' | ' | ' |
Loans outstanding, end of period | $0 | $0 | $0 |
MORTGAGE_SERVICING_RIGHTS_Deta
MORTGAGE SERVICING RIGHTS (Details) (Mortgage loans, USD $) | 9 Months Ended | 12 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 |
Mortgage loans | ' | ' | ' |
Mortgage Loans | ' | ' | ' |
Residential first mortgage loans the Corporation has obligations to service | $144,051 | ' | ' |
Annual constant prepayment speed (as a percent) | 9.77% | ' | ' |
Discount rate (as a percent) | 8.83% | ' | ' |
Changes in mortgage servicing rights capitalized and amortized, along with the aggregate activity in related valuation allowances | ' | ' | ' |
Balance at beginning of period | 1,129 | 638 | 638 |
Additions from loans sold with servicing retained | 375 | 325 | 675 |
Amortization | -218 | -129 | -184 |
Balance at end of period | $1,286 | $834 | $1,129 |
BORROWINGS_Details
BORROWINGS (Details) (USD $) | 3 Months Ended | 9 Months Ended | 9 Months Ended | 3 Months Ended | |||||||||||||||||
Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Sep. 30, 2014 | |
item | Federal Home Loan Bank borrowings | Federal Home Loan Bank borrowings | Federal Home Loan Bank borrowings | Federal Home Loan Bank borrowings | Federal Home Loan Bank borrowings | Federal Home Loan Bank borrowings | Line of Credit | Line of Credit | Line of Credit | Bank Line Of Credit Wholly Owned Assets Based Lending Subsidiary Member | Revolving Credit Facility | Correspondent bank term note, current floor rate of 4%, maturing December 28, 2017 | Correspondent bank term note, current floor rate of 4%, maturing December 28, 2017 | Correspondent bank term note, current floor rate of 4%, maturing December 28, 2017 | First Rural Relending | ||||||
Mortgage related and municipal securities | Federal Home Loan Bank stock | One to four family residential real estate | 90-day LIBOR | 90-day LIBOR | |||||||||||||||||
BORROWINGS | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Borrowings | $44,909,000 | $37,852,000 | $35,852,000 | $35,000,000 | $35,000,000 | $35,000,000 | ' | ' | ' | $4,500,000 | $2,000,000 | ' | $1,830,000 | ' | $2,800,000 | ' | ' | $779,000 | $852,000 | $852,000 | ' |
Interest rate on note (as a percent) | ' | ' | ' | 1.82% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 4.00% | ' | 4.00% | 1.00% | ' | ' | ' |
Loans pledged as collateral | ' | ' | ' | ' | ' | ' | ' | ' | 42,041,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 779,000 |
Securities pledged as collateral, amortized cost | ' | ' | ' | ' | ' | ' | 4,167,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Securities pledged as collateral, fair value | ' | ' | ' | ' | ' | ' | 4,300,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Stock owned and pledged as collateral | ' | ' | ' | ' | ' | ' | ' | 3,060,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Demand deposit account pledged as collateral | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 720,000 |
Variable rate basis | ' | ' | ' | ' | ' | ' | ' | ' | ' | '90-day LIBOR | ' | ' | ' | '90-day LIBOR | ' | ' | ' | ' | ' | ' | ' |
Variable rate (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2.75% | ' | 2.75% | ' | ' | ' | ' | ' | ' | ' |
Floor rate (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | 4.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of banking borrowing relationship | 2 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Maximum borrowing | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 10,000,000 | ' | ' | ' | ' | ' | ' | ' |
Maximum borrowing capacity upon request to increase | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 25,000,000 | ' | ' | ' | ' | ' | ' | ' |
Frequency of period payment | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 'quarterly | 'quarterly | ' | ' | ' | ' | ' |
Quarterly principal payment | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $100,000 | $100,000 | ' | ' | ' | ' | ' |
STOCK_COMPENSATION_PLANS_Detai
STOCK COMPENSATION PLANS (Details) (USD $) | 0 Months Ended | 1 Months Ended | 9 Months Ended | |||
Aug. 31, 2013 | Mar. 31, 2014 | Aug. 31, 2012 | Sep. 30, 2014 | 22-May-12 | 22-May-12 | |
RSUs | RSUs | RSUs | RSUs | 2012 Incentive Compensation Plan | 2012 Incentive Compensation Plan | |
Stock Options | ||||||
Stock Compensation Plans | ' | ' | ' | ' | ' | ' |
Number of RSUs granted (in shares) | 37,125 | 52,774 | 148,500 | ' | ' | ' |
Total authorized share balance | ' | ' | ' | ' | 575,000 | 392,152 |
Share price (in dollars per share) | ' | $12.95 | $7.91 | $12.95 | ' | ' |
Cost to the employee | ' | ' | ' | $0 | ' | ' |
Vesting period | ' | '4 years | '4 years | '4 years | ' | ' |
Recognition period of compensation cost to be recognized | ' | ' | ' | '4 years | ' | ' |
Compensation cost to be recognized | ' | 683,000 | 1,175,000 | 683,000 | ' | ' |
Number of RSUs unvested (in shares) | ' | ' | ' | 127,024 | ' | ' |
Compensation cost to be recognized | ' | ' | ' | $1,154,000 | ' | ' |
STOCK_COMPENSATION_PLANS_Detai1
STOCK COMPENSATION PLANS (Details 2) (USD $) | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 | |
Stock option transactions | ' | ' | ' |
Outstanding shares at beginning of year | 237,152 | 242,152 | 242,152 |
Granted during the year (in shares) | 0 | 0 | ' |
Expired / forfeited during the year (in shares) | ' | -5,000 | ' |
Surrendered/exchanged for restricted stock (in shares) | ' | ' | -5,000 |
Outstanding shares at end of year | 237,152 | 237,152 | 237,152 |
Exercisable shares at end of year | 124,861 | 125,861 | 124,861 |
Weighted average exercise price per share at end of year (in dollars per share) | $9.80 | $9.88 | $9.80 |
STOCK_COMPENSATION_PLANS_Detai2
STOCK COMPENSATION PLANS (Details 3) (USD $) | 9 Months Ended |
Sep. 30, 2014 | |
Stock option plans | ' |
Number of Shares, Outstanding | 237,152 |
Number of Shares, Exercisable | 124,861 |
Number of Shares, Unvested Options | 112,291 |
Weighted Average Remaining Contractual Life-Years | '4 months 2 days |
$9.75 | ' |
Stock option plans | ' |
Exercise Price (in dollars per share) | 9.75 |
Number of Shares, Outstanding | 217,152 |
Number of Shares, Exercisable | 120,861 |
Number of Shares, Unvested Options | 96,291 |
Weighted Average Remaining Contractual Life-Years | '2 months 23 days |
$10.65 | ' |
Stock option plans | ' |
Exercise Price (in dollars per share) | 10.65 |
Number of Shares, Outstanding | 10,000 |
Number of Shares, Exercisable | 2,000 |
Number of Shares, Unvested Options | 8,000 |
Weighted Average Remaining Contractual Life-Years | '9 months 15 days |
$12.00 | ' |
Stock option plans | ' |
Exercise Price (in dollars per share) | 12 |
Number of Shares, Outstanding | 10,000 |
Number of Shares, Exercisable | 2,000 |
Number of Shares, Unvested Options | 8,000 |
Weighted Average Remaining Contractual Life-Years | '2 years 2 months 16 days |
INCOME_TAXES_Details
INCOME TAXES (Details) (USD $) | 9 Months Ended | ||
Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | |
INCOME TAXES | ' | ' | ' |
Net operating loss (NOL) carryforwards | $16,300,000 | ' | ' |
Tax credit carryforwards | 2,400,000 | ' | ' |
Expiration period from date of origination for net operating loss carryforwards | '20 years | ' | ' |
Annual limitation for usage of NOL | 1,400,000 | ' | ' |
Annual limitation for usage of tax credits | 476,000 | ' | ' |
Deferred tax assets, net of valuation allowance | 8,681,000 | 9,933,000 | 7,953,000 |
Valuation allowance | 760,000 | ' | ' |
Adjustment warranted to the valuation | $0 | ' | ' |
FAIR_VALUE_MEASUREMENTS_Detail
FAIR VALUE MEASUREMENTS (Details) (USD $) | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2013 |
FAIR VALUE MEASUREMENTS | ' | ' | ' |
Blended interest rate for determining fair value of nonaccrual loans (as a percent) | 0.00% | ' | ' |
Fair value of commitments | $0 | ' | ' |
Financial assets: | ' | ' | ' |
Interest-bearing deposits | 235 | 10 | 10 |
Securities available for sale | 48,742 | 44,388 | 48,096 |
Carrying Amount | ' | ' | ' |
Financial assets: | ' | ' | ' |
Total financial assets | 588,989 | 546,199 | 543,032 |
Financial liabilities: | ' | ' | ' |
Total financial liabilities | 536,299 | 504,333 | 497,740 |
Estimated Fair Value | ' | ' | ' |
Financial assets: | ' | ' | ' |
Total financial assets | 589,012 | 546,566 | 535,505 |
Financial liabilities: | ' | ' | ' |
Total financial liabilities | 537,381 | 503,100 | 495,610 |
Level 1 | Carrying Amount | ' | ' | ' |
Financial assets: | ' | ' | ' |
Cash and cash equivalents | 22,401 | 18,219 | 22,794 |
Level 1 | Estimated Fair Value | ' | ' | ' |
Financial assets: | ' | ' | ' |
Cash and cash equivalents | 22,401 | 18,219 | 22,794 |
Level 2 | Carrying Amount | ' | ' | ' |
Financial assets: | ' | ' | ' |
Interest-bearing deposits | 235 | 10 | 10 |
Securities available for sale | 48,742 | 44,388 | 48,096 |
Federal Home Loan Bank stock | 3,060 | 3,060 | 3,060 |
Financial liabilities: | ' | ' | ' |
Deposits | 491,206 | 466,299 | 461,688 |
Borrowings | 44,909 | 37,852 | 35,852 |
Level 2 | Estimated Fair Value | ' | ' | ' |
Financial assets: | ' | ' | ' |
Interest-bearing deposits | 235 | 10 | 10 |
Securities available for sale | 48,742 | 44,388 | 48,096 |
Federal Home Loan Bank stock | 3,060 | 3,060 | 3,060 |
Financial liabilities: | ' | ' | ' |
Deposits | 491,912 | 465,431 | 459,862 |
Borrowings | 45,285 | 37,487 | 35,548 |
Significant Unobservable Inputs (Level 3) | Carrying Amount | ' | ' | ' |
Financial assets: | ' | ' | ' |
Net loans | 513,094 | 479,171 | 467,536 |
Accrued interest receivable | 1,457 | 1,351 | 1,536 |
Financial liabilities: | ' | ' | ' |
Accrued interest payable | 184 | 182 | 200 |
Significant Unobservable Inputs (Level 3) | Estimated Fair Value | ' | ' | ' |
Financial assets: | ' | ' | ' |
Net loans | 513,117 | 479,538 | 460,009 |
Accrued interest receivable | 1,457 | 1,351 | 1,536 |
Financial liabilities: | ' | ' | ' |
Accrued interest payable | $184 | $182 | $200 |
FAIR_VALUE_MEASUREMENTS_Detail1
FAIR VALUE MEASUREMENTS (Details 2) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2013 |
In Thousands, unless otherwise specified | |||
Fair value measurements | ' | ' | ' |
Other real estate owned | $1,843 | $1,884 | $2,568 |
Nonrecurring | Estimated Fair Value | ' | ' | ' |
Fair value measurements | ' | ' | ' |
Impaired loans | 2,695 | 2,024 | 4,313 |
Other real estate owned | 1,843 | 1,884 | 2,568 |
Nonrecurring | Significant Unobservable Inputs (Level 3) | ' | ' | ' |
Fair value measurements | ' | ' | ' |
Impaired loans | 2,695 | -2,024 | 4,313 |
Other real estate owned | 1,843 | -1,884 | 2,568 |
Recurring | ' | ' | ' |
Fair value measurements | ' | ' | ' |
Other assets | 0 | ' | 0 |
Other liabilities | 0 | ' | 0 |
Recurring | Significant Unobservable Inputs (Level 3) | ' | ' | ' |
Fair value measurements | ' | ' | ' |
Assets | 0 | 0 | 0 |
Liabilities | $0 | $0 | $0 |
FAIR_VALUE_MEASUREMENTS_Detail2
FAIR VALUE MEASUREMENTS (Details 3) (Nonrecurring, USD $) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 |
Fair value | ' | ' | ' | ' | ' |
Total Losses | $186 | $588 | $630 | $1,095 | $2,340 |
Investments | 0 | ' | 0 | ' | ' |
Impaired loans | ' | ' | ' | ' | ' |
Fair value | ' | ' | ' | ' | ' |
Total Losses | 10 | 531 | 440 | 949 | 2,075 |
Other real estate owned | ' | ' | ' | ' | ' |
Fair value | ' | ' | ' | ' | ' |
Total Losses | $176 | $57 | $190 | $146 | $265 |
SHAREHOLDERS_EQUITY_Details
SHAREHOLDER'S EQUITY (Details) (USD $) | 0 Months Ended | 1 Months Ended | 3 Months Ended | 12 Months Ended | 1 Months Ended | 9 Months Ended | 12 Months Ended | |
Feb. 27, 2013 | Dec. 17, 2013 | Aug. 31, 2012 | Mar. 31, 2014 | Dec. 31, 2013 | Apr. 30, 2009 | Sep. 30, 2014 | Dec. 31, 2012 | |
Steinhardt Capital Investors, LLLP | Common Shareholders' Equity | Common Shareholders' Equity | US Treasury with TARP Capital Purchase Program | US Treasury with TARP Capital Purchase Program | US Treasury with TARP Capital Purchase Program | |||
Preferred Stock Series A | Warrant | Warrant | ||||||
Series A | ||||||||
Participation in the TARP Capital Purchase Program | ' | ' | ' | ' | ' | ' | ' | ' |
Previously announced rights offering amount | ' | ' | $7,000,000 | ' | ' | ' | ' | ' |
Shares issued | ' | ' | 2,140,123 | ' | ' | 11,000 | ' | ' |
Issuance of common stock | ' | ' | 11,506,000 | ' | ' | ' | ' | ' |
Repurchase of common stock warrants issued | ' | ' | ' | ' | ' | ' | 379,310 | ' |
Purchase of common stock warrants | ' | ' | ' | ' | ' | ' | ' | 1,300,000 |
Number of shares repurchased | ' | ' | ' | 13,700 | 55,594 | ' | ' | ' |
Number of shares authorized to be repurchased | 600,000 | ' | ' | ' | ' | ' | ' | ' |
Number of additional shares authorized to be repurchased | ' | $600,000 | ' | ' | ' | ' | ' | ' |
COMMITMENTS_CONTINGENCIES_AND_2
COMMITMENTS, CONTINGENCIES AND CREDIT RISK (Details) (USD $) | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2013 |
Financial Instruments with Off-Balance-Sheet Risk | ' | ' | ' |
Commitments | $83,070 | $59,338 | $64,500 |
Commitments to extend credit | ' | ' | ' |
Financial Instruments with Off-Balance-Sheet Risk | ' | ' | ' |
Commitments, variable rate | 54,962 | 36,039 | 32,061 |
Commitments, fixed rate | 19,092 | 15,070 | 24,536 |
Standby letters of credit | ' | ' | ' |
Financial Instruments with Off-Balance-Sheet Risk | ' | ' | ' |
Commitments, variable rate | 5,730 | 5,077 | 4,741 |
Percentage collateralization on financial instruments allowed under commitments | 100.00% | ' | ' |
Credit card commitments | ' | ' | ' |
Financial Instruments with Off-Balance-Sheet Risk | ' | ' | ' |
Commitments, fixed rate | $3,286 | $3,152 | $3,162 |
COMMITMENTS_CONTINGENCIES_AND_3
COMMITMENTS, CONTINGENCIES AND CREDIT RISK (Details 2) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 |
In Thousands, unless otherwise specified | Commercial real estate loans | Commercial real estate loans | Commercial real estate loans | Bank | Bank | |||
Commercial real estate loans | Commercial real estate loans | |||||||
Commercial loan portfolio | Commercial loan portfolio | |||||||
Credit risk concentration | Credit risk concentration | |||||||
Concentration of Credit Risk | ' | ' | ' | ' | ' | ' | ' | ' |
Loan portfolio | $513,094 | $479,171 | $467,536 | $271,161 | $266,960 | $255,406 | $100,912 | $101,406 |
Percentage of concentration risk under a specified benchmark | ' | ' | ' | ' | ' | ' | 26.30% | 28.68% |
PENDING_ACQUISITION_Details
PENDING ACQUISITION (Details) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jul. 18, 2014 | Jul. 18, 2014 |
Peninsula Financial Corporation Member | Peninsula Financial Corporation Member | ||||
item | |||||
Purchase price | ' | ' | ' | $13,285,000,000 | ' |
Purchase price on contemplation of special dividend to shareholders prior to consummation | ' | ' | ' | 10,500,000 | ' |
Assets | $613,943,000 | $572,800,000 | $567,917,000 | ' | $132,000,000 |
Number of banking offices | ' | ' | ' | 6 | ' |