Loan Quality And Allowance For Loan Losses | Note 6 . Loan Quality and Allowance for Loan Losses The following table presents, by c l ass , the activity in the Allowance for Loan Losses (ALL) for the periods ended: Residential Real Estate 1-4 Family Junior Liens & Commercial (Dollars in thousands) First Liens Lines of Credit Construction Real Estate Commercial Consumer Unallocated Total ALL at March 31, 2017 $ 1,100 $ 321 $ 274 $ 6,126 $ 1,984 $ 99 $ 1,374 $ 11,278 Charge-offs (5) - - (5) (2) (24) - (36) Recoveries - 1 - - 4 10 - 15 Provision (20) - 7 (69) 37 15 80 50 ALL at June 30, 2017 $ 1,075 $ 322 $ 281 $ 6,052 $ 2,023 $ 100 $ 1,454 $ 11,307 ALL at December 31, 2016 $ 1,105 $ 323 $ 224 $ 6,109 $ 1,893 $ 100 $ 1,321 $ 11,075 Charge-offs (13) - - (5) (2) (52) - (72) Recoveries 1 1 - - 106 26 - 134 Provision (18) (2) 57 (52) 26 26 133 170 ALL at June 30, 2017 $ 1,075 $ 322 $ 281 $ 6,052 $ 2,023 $ 100 $ 1,454 $ 11,307 ALL at March 31, 2016 $ 997 $ 316 $ 199 $ 6,181 $ 1,510 $ 99 $ 1,040 $ 10,342 Charge-offs (46) - - (1,951) (3) (42) - (2,042) Recoveries 1 - - 14 106 22 - 143 Provision 71 3 6 1,696 (17) 18 98 1,875 ALL at June 30, 2016 $ 1,023 $ 319 $ 205 $ 5,940 $ 1,596 $ 97 $ 1,138 $ 10,318 ALL at December 31, 2015 $ 989 $ 308 $ 194 $ 5,649 $ 1,519 $ 102 $ 1,325 $ 10,086 Charge-offs (49) - - (1,954) (66) (84) - (2,153) Recoveries 33 - - 14 121 42 - 210 Provision 50 11 11 2,231 22 37 (187) 2,175 ALL at June 30, 2016 $ 1,023 $ 319 $ 205 $ 5,940 $ 1,596 $ 97 $ 1,138 $ 10,318 T he following table presents, by c la ss , loans that were evaluated for the ALL under the specific reserve (individually) and those that were evaluated under the general reserve (collectively) and the amount of the ALL established in each class as of June 30 , 2017 and December 31, 201 6 : Residential Real Estate 1-4 Family Junior Liens & Commercial (Dollars in thousands) First Liens Lines of Credit Construction Real Estate Commercial Consumer Unallocated Total June 30, 2017 Loans evaluated for ALL: Individually $ 818 $ 106 $ 473 $ 11,345 $ 100 $ - $ - $ 12,842 Collectively 162,432 49,587 10,753 375,439 285,680 4,681 - 888,572 Total $ 163,250 $ 49,693 $ 11,226 $ 386,784 $ 285,780 $ 4,681 $ - $ 901,414 ALL established for loans evaluated: Individually $ - $ - $ - $ - $ - $ - $ - $ - Collectively 1,075 322 281 6,052 2,023 100 1,454 11,307 ALL at June 30, 2017 $ 1,075 $ 322 $ 281 $ 6,052 $ 2,023 $ 100 $ 1,454 $ 11,307 December 31, 2016 Loans evaluated for ALL: Individually $ 628 $ 52 $ 480 $ 13,523 $ - $ - $ - $ 14,683 Collectively 167,942 50,161 8,495 377,061 270,826 4,705 - 879,190 Total $ 168,570 $ 50,213 $ 8,975 $ 390,584 $ 270,826 $ 4,705 $ - $ 893,873 ALL established for loans evaluated: Individually $ - $ - $ - $ - $ - $ - $ - $ - Collectively 1,105 323 224 6,109 1,893 100 1,321 11,075 ALL at December 31, 2016 $ 1,105 $ 323 $ 224 $ 6,109 $ 1,893 $ 100 $ 1,321 $ 11,075 The following table shows additional information about those loans considered to be impaired at June 30 , 2017 and December 31, 201 6 : Impaired Loans With No Allowance With Allowance (Dollars in thousands) Unpaid Unpaid Recorded Principal Recorded Principal Related June 30, 2017 Investment Balance Investment Balance Allowance Residential Real Estate 1-4 Family First liens $ 1,161 $ 1,231 $ - $ - $ - Junior liens and lines of credit 115 120 - - - Total 1,276 1,351 - - - Residential real estate - construction 473 533 - - - Commercial real estate 11,345 11,808 - - - Commercial 121 133 - - - Total $ 13,215 $ 13,825 $ - $ - $ - December 31, 2016 Residential Real Estate 1-4 Family First liens $ 956 $ 1,030 $ - $ - $ - Junior liens and lines of credit 85 93 - - - Total 1,041 1,123 - - - Residential real estate - construction 480 535 - - - Commercial real estate 13,523 14,133 - - Commercial 23 35 - - - Total $ 15,067 $ 15,826 $ - $ - $ - The following table shows the average of impaired loans and related interest income for the three and six months ended June 30, 2017 and 2016 : Three Months Ended Six Months Ended June 30, 2017 June 30, 2017 Average Interest Average Interest (Dollars in thousands) Recorded Income Recorded Income Investment Recognized Investment Recognized Residential Real Estate 1-4 Family First liens $ 1,168 $ 10 $ 1,039 $ 20 Junior liens and lines of credit 115 - 100 - Total 1,283 10 1,139 20 Residential real estate - construction 476 - 478 - Commercial real estate 12,043 102 12,104 218 Commercial 122 - 73 - Total $ 13,924 $ 112 $ 13,794 $ 238 Three Months Ended Six Months Ended June 30, 2016 June 30, 2016 Average Interest Average Interest (Dollars in thousands) Recorded Income Recorded Income Investment Recognized Investment Recognized Residential Real Estate 1-4 Family First liens $ 926 $ 6 $ 998 $ 12 Junior liens and lines of credit 63 - 67 - Total 989 6 1,065 12 Residential real estate - construction 494 - 498 - Commercial real estate 19,345 117 19,555 239 Commercial 34 - 39 - Total $ 20,862 $ 123 $ 21,157 $ 251 The following table presents the aging of payments of the loan portfolio : (Dollars in thousands) Loans Past Due and Still Accruing Total Current 30-59 Days 60-89 Days 90 Days+ Total Non-Accrual Loans June 30, 2017 Residential Real Estate 1-4 Family First liens $ 162,334 $ 174 $ 294 $ 61 $ 529 $ 387 $ 163,250 Junior liens and lines of credit 49,481 97 - 8 105 107 49,693 Total 211,815 271 294 69 634 494 212,943 Residential real estate - construction 10,753 - - - - 473 11,226 Commercial real estate 384,513 117 185 - 302 1,969 386,784 Commercial 285,493 122 44 - 166 121 285,780 Consumer 4,647 26 8 - 34 - 4,681 Total $ 897,221 $ 536 $ 531 $ 69 $ 1,136 $ 3,057 $ 901,414 December 31, 2016 Residential Real Estate 1-4 Family First liens $ 166,689 $ 1,236 $ 414 $ - $ 1,650 $ 231 $ 168,570 Junior liens and lines of credit 50,031 96 - - 96 86 50,213 Total 216,720 1,332 414 - 1,746 317 218,783 Residential real estate - construction 8,495 - - - - 480 8,975 Commercial real estate 384,658 858 447 665 1,970 3,956 390,584 Commercial 270,478 250 75 - 325 23 270,826 Consumer 4,672 30 3 - 33 - 4,705 Total $ 885,023 $ 2,470 $ 939 $ 665 $ 4,074 $ 4,776 $ 893,873 The following table reports the internal credit rating for the loan portfolio. Consumer purpose loans are assigned a rating of either pass or substandard based on the performance status of the loans. Substandard consumer loans are comprised of loans 90 days or more past due and still accruing , and nonaccrual loans. Commercial purpose loans may be assigned any rating in accordance with the Bank’s internal risk rating system. Pass Special Mention Substandard Doubtful (Dollars in thousands) (1-5) (6) (7) (8) Total June 30, 2017 Residential Real Estate 1-4 Family First liens $ 161,904 $ - $ 1,346 $ - $ 163,250 Junior liens and lines of credit 49,579 - 114 - 49,693 Total 211,483 - 1,460 - 212,943 Residential real estate - construction 10,146 - 1,080 - 11,226 Commercial real estate 375,919 - 10,865 - 386,784 Commercial 282,122 - 3,658 - 285,780 Consumer 4,681 - - - 4,681 Total $ 884,351 $ - $ 17,063 $ - $ 901,414 December 31, 2016 Residential Real Estate 1-4 Family First liens $ 167,199 $ 227 $ 1,144 $ - $ 168,570 Junior liens and lines of credit 50,017 28 168 - 50,213 Total 217,216 255 1,312 - 218,783 Residential real estate - construction 8,220 - 755 - 8,975 Commercial real estate 377,283 - 13,301 - 390,584 Commercial 267,901 957 1,968 - 270,826 Consumer 4,705 - - - 4,705 Total $ 875,325 $ 1,212 $ 17,336 $ - $ 893,873 The following table presents information on the Bank’s Troubled Debt Restructuring (TDR) loans: Troubled Debt Restructurings That Have Defaulted on Modified Terms in the (Dollars in thousands) Troubled Debt Restructurings Last Twelve Months Number of Recorded Number of Recorded Contracts Investment Performing* Nonperforming* Contracts Investment June 30, 2017 Residential real estate - construction 1 $ 473 $ 473 $ - - $ - Residential real estate 5 864 713 151 1 151 Commercial real estate 11 11,186 10,591 595 1 595 Total 17 $ 12,523 $ 11,777 $ 746 2 $ 746 December 31, 2016 Residential real estate - construction 1 $ 480 $ 480 $ - - $ - Residential real estate 5 875 724 151 1 151 Commercial real estate 11 12,064 10,814 1,250 1 1,250 Total 17 $ 13,419 $ 12,018 $ 1,401 2 $ 1,401 * The performing status is determined by the loan’s compliance with the modified terms . There were no new TDR loans during 201 7 . The following table reports new TDR loans during 2016, concession granted and the recorded investment as of June 3 0 , 2016 : New During Period Number of Pre-TDR After-TDR Recorded Six Months Ended June 30, 2016 Contracts Modification Modification Investment Concession Commercial real estate 1 $ 525 $ 525 $ 504 multiple |