Allowance for Loan Losses | 9 Months Ended |
Sep. 30, 2014 |
Receivables [Abstract] | ' |
Allowance for Loan Losses | ' |
Note 6. Allowance for Loan Losses |
The Company maintains an allowance for loan losses in an amount determined by management on the basis of the character of the loans, loan performance, financial condition of borrowers, the value of collateral securing loans and other relevant factors. |
The following table summarizes the changes in the Company’s allowance for loan losses for the periods indicated. |
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| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Three months ended | | | Nine months ended | | | | | | | | | | | | | | | | | |
September 30, | September 30, | | | | | | | | | | | | | | | | |
| | 2014 | | | 2013 | | | 2014 | | | 2013 | | | | | | | | | | | | | | | | | |
| | (in thousands) | | | | | | | | | | | | | | | | | |
Allowance for loan losses, beginning of period | | $ | 21,722 | | | $ | 20,500 | | | $ | 20,941 | | | $ | 19,197 | | | | | | | | | | | | | | | | | |
Loans charged off | | | (163 | ) | | | (149 | ) | | | (705 | ) | | | (682 | ) | | | | | | | | | | | | | | | | |
Recoveries on loans previously charged-off | | | 310 | | | | 149 | | | | 583 | | | | 485 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net charge-offs | | | 147 | | | | — | | | | (122 | ) | | | (197 | ) | | | | | | | | | | | | | | | | |
Provision charged to expense | | | 600 | | | | 750 | | | | 1,650 | | | | 2,250 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Allowance for loan losses, end of period | | $ | 22,469 | | | $ | 21,250 | | | $ | 22,469 | | | $ | 21,250 | | | | | | | | | | | | | | | | | |
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Further information pertaining to the allowance for loan losses for the three months ending September 30, 2014 follows: |
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| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Construction | | | Commercial | | | Commercial | | | Residential | | | Consumer | | | Home | | | Unallocated | | | Total | |
and Land | and | Real | Real | Equity |
Development | Industrial | Estate | Estate | |
| | (Dollars in thousands) | |
Allowance for loan losses: | | | | | | | | | | | | | | | | | | | | |
Balance at June 30, 2014 | | $ | 2,045 | | | $ | 2,915 | | | $ | 11,975 | | | $ | 1,927 | | | $ | 428 | | | $ | 915 | | | $ | 1,517 | | | $ | 21,722 | |
Charge-offs | | | — | | | | (37 | ) | | | — | | | | — | | | | (126 | ) | | | — | | | | — | | | | (163 | ) |
Recoveries | | | — | | | | 115 | | | | 1 | | | | 6 | | | | 106 | | | | 82 | | | | — | | | | 310 | |
Provision | | | (39 | ) | | | 2,396 | | | | (1,116 | ) | | | (132 | ) | | | 46 | | | | (41 | ) | | | (514 | ) | | | 600 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Ending balance at September 30, 2014 | | $ | 2,006 | | | $ | 5,389 | | | $ | 10,860 | | | $ | 1,801 | | | $ | 454 | | | $ | 956 | | | $ | 1,003 | | | $ | 22,469 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Amount of allowance for loan losses for loans deemed to be impaired | | $ | 272 | | | $ | 348 | | | $ | 648 | | | $ | 152 | | | $ | — | | | $ | 93 | | | $ | — | | | | 1,513 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Amount of allowance for loan losses for loans not deemed to be impaired | | $ | 1,734 | | | $ | 5,041 | | | $ | 10,212 | | | $ | 1,649 | | | $ | 454 | | | $ | 863 | | | $ | 1,003 | | | $ | 20,956 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Loans: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Ending balance | | $ | 25,339 | | | $ | 181,627 | | | $ | 702,894 | | | $ | 268,927 | | | $ | 10,253 | | | $ | 147,593 | | | $ | — | | | $ | 1,336,633 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Loans deemed to be impaired | | $ | 354 | | | $ | 1,096 | | | $ | 4,740 | | | $ | 1,549 | | | $ | — | | | $ | 93 | | | $ | — | | | $ | 7,832 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Loans not deemed to be impaired | | $ | 24,985 | | | $ | 180,531 | | | $ | 698,154 | | | $ | 267,378 | | | $ | 10,253 | | | $ | 147,500 | | | $ | — | | | $ | 1,328,801 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Further information pertaining to the allowance for loan losses for the nine months ending September 30, 2014 follows: |
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| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Construction | | | Commercial | | | Commercial | | | Residential | | | Consumer | | | Home | | | Unallocated | | | Total | |
and Land | and | Real | Real | Equity |
Development | Industrial | Estate | Estate | |
| | (Dollars in thousands) | |
Allowance for loan losses: | | | | | | | | | | | | | | | | | | | | |
Balance at December 31, 2013 | | $ | 2,174 | | | $ | 2,989 | | | $ | 11,218 | | | $ | 2,006 | | | $ | 432 | | | $ | 959 | | | $ | 1,163 | | | $ | 20,941 | |
Charge-offs | | | (250 | ) | | | (51 | ) | | | — | | | | — | | | | (404 | ) | | | — | | | | — | | | | (705 | ) |
Recoveries | | | — | | | | 164 | | | | 5 | | | | 26 | | | | 305 | | | | 83 | | | | — | | | | 583 | |
Provision | | | 82 | | | | 2,287 | | | | (363 | ) | | | (231 | ) | | | 121 | | | | (86 | ) | | | (160 | ) | | | 1,650 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Ending balance at September 30, 2014 | | $ | 2,006 | | | $ | 5,389 | | | $ | 10,860 | | | $ | 1,801 | | | $ | 454 | | | $ | 956 | | | $ | 1,003 | | | $ | 22,469 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Amount of allowance for loan losses for loans deemed to be impaired | | $ | 272 | | | $ | 348 | | | $ | 648 | | | $ | 152 | | | $ | — | | | $ | 93 | | | $ | — | | | | 1,513 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Amount of allowance for loan losses for loans not deemed to be impaired | | $ | 1,734 | | | $ | 5,041 | | | $ | 10,212 | | | $ | 1,649 | | | $ | 454 | | | $ | 863 | | | $ | 1,003 | | | $ | 20,956 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Loans: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Ending balance | | $ | 25,339 | | | $ | 181,627 | | | $ | 702,894 | | | $ | 268,927 | | | $ | 10,253 | | | $ | 147,593 | | | $ | — | | | $ | 1,336,633 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Loans deemed to be impaired | | $ | 354 | | | $ | 1,096 | | | $ | 4,740 | | | $ | 1,549 | | | $ | — | | | $ | 93 | | | $ | — | | | $ | 7,832 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Loans not deemed to be impaired | | $ | 24,985 | | | $ | 180,531 | | | $ | 698,154 | | | $ | 267,378 | | | $ | 10,253 | | | $ | 147,500 | | | $ | — | | | $ | 1,328,801 | |
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Further information pertaining to the allowance for loan losses for the three months ending September 30, 2013 follows: |
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| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Construction | | | Commercial | | | Commercial | | | Residential | | | Consumer | | | Home | | | Unallocated | | | Total | |
and Land | and | Real | Real | Equity |
Development | Industrial | Estate | Estate | |
| | (Dollars in thousands) | |
Allowance for loan losses: | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | |
Balance at June 30, 2013 | | $ | 3,241 | | | $ | 3,215 | | | $ | 9,424 | | | $ | 2,030 | | | $ | 363 | | | $ | 932 | | | $ | 1,295 | | | $ | 20,500 | |
Charge-offs | | | — | | | | — | | | | — | | | | — | | | | (149 | ) | | | — | | | | — | | | | (149 | ) |
Recoveries | | | — | | | | 42 | | | | 2 | | | | 4 | | | | 101 | | | | — | | | | — | | | | 149 | |
Provision | | | (114 | ) | | | (534 | ) | | | 1,162 | | | | 176 | | | | 76 | | | | 17 | | | | (33 | ) | | | 750 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Ending balance at September 30, 2013 | | $ | 3,127 | | | $ | 2,723 | | | $ | 10,588 | | | $ | 2,210 | | | $ | 391 | | | $ | 949 | | | $ | 1 | | | $ | 21,250 | |
,262 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Amount of allowance for loan losses for loans deemed to be impaired | | $ | 1,000 | | | $ | 90 | | | $ | 445 | | | $ | 139 | | | $ | — | | | $ | 95 | | | $ | — | | | | 1,769 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Amount of allowance for loan losses for loans not deemed to be impaired | | $ | 2,127 | | | $ | 2,633 | | | $ | 10,143 | | | $ | 2,071 | | | $ | 391 | | | $ | 854 | | | $ | 1,262 | | | $ | 19,481 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Loans: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Ending balance | | $ | 32,750 | | | $ | 87,468 | | | $ | 666,166 | | | $ | 309,291 | | | $ | 8,728 | | | $ | 126,645 | | | $ | — | | | $ | 1,231,048 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Loans deemed to be impaired | | $ | 1,500 | | | $ | 1,132 | | | $ | 4,688 | | | $ | 1,151 | | | $ | — | | | $ | 95 | | | $ | — | | | $ | 8,566 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Loans not deemed to be impaired | | $ | 31,250 | | | $ | 86,336 | | | $ | 661,478 | | | $ | 308,140 | | | $ | 8,728 | | | $ | 126,550 | | | $ | — | | | $ | 1,222,482 | |
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Further information pertaining to the allowance for loan losses for the nine months ending September 30, 2013 follows: |
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| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Construction | | | Commercial | | | Commercial | | | Residential | | | Consumer | | | Home | | | Unallocated | | | Total | |
and Land | and | Real | Real | Equity |
Development | Industrial | Estate | Estate | |
| | (Dollars in thousands) | |
Allowance for loan losses: | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | |
Balance at December 31, 2012 | | $ | 3,041 | | | $ | 3,118 | | | $ | 9,065 | | | $ | 1,994 | | | $ | 333 | | | $ | 886 | | | $ | 760 | | | $ | 19,197 | |
Charge-offs | | | — | | | | (234 | ) | | | — | | | | — | | | | (448 | ) | | | — | | | | — | | | | (682 | ) |
Recoveries | | | — | | | | 163 | | | | 5 | | | | 9 | | | | 307 | | | | 1 | | | | — | | | | 485 | |
Provision | | | 86 | | | | (324 | ) | | | 1,518 | | | | 207 | | | | 199 | | | | 62 | | | | 502 | | | | 2,250 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Ending balance at September 30, 2013 | | $ | 3,127 | | | $ | 2,723 | | | $ | 10,588 | | | $ | 2,210 | | | $ | 391 | | | $ | 949 | | | $ | 1 | | | $ | 21,250 | |
,262 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Amount of allowance for loan losses for loans deemed to be impaired | | $ | 1,000 | | | $ | 90 | | | $ | 445 | | | $ | 139 | | | $ | — | | | $ | 95 | | | $ | — | | | | 1,769 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Amount of allowance for loan losses for loans not deemed to be impaired | | $ | 2,127 | | | $ | 2,633 | | | $ | 10,143 | | | $ | 2,071 | | | $ | 391 | | | $ | 854 | | | $ | 1,262 | | | $ | 19,481 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Loans: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Ending balance | | $ | 32,750 | | | $ | 87,468 | | | $ | 666,166 | | | $ | 309,291 | | | $ | 8,728 | | | $ | 126,645 | | | $ | — | | | $ | 1,231,048 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Loans deemed to be impaired | | $ | 1,500 | | | $ | 1,132 | | | $ | 4,688 | | | $ | 1,151 | | | $ | — | | | $ | 95 | | | $ | — | | | $ | 8,566 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Loans not deemed to be impaired | | $ | 31,250 | | | $ | 86,336 | | | $ | 661,478 | | | $ | 308,140 | | | $ | 8,728 | | | $ | 126,550 | | | $ | — | | | $ | 1,222,482 | |
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The Company utilizes a six grade internal loan rating system for commercial real estate, construction and commercial loans as follows: |
Loans rated 1-3 (Pass): |
Loans in this category are considered “pass” rated loans with low to average risk. |
Loans rated 4 (Monitor): |
These loans represent classified loans that management is closely monitoring for credit quality. These loans have had or may have minor credit quality deterioration as of September 30, 2014 and December 31, 2013. |
Loans rated 5 (Substandard): |
Substandard loans represent classified loans that management is closely monitoring for credit quality. These loans have had more significant credit quality deterioration as of September 30, 2014 and December 31, 2013. |
Loans rated 6 (Doubtful): |
Doubtful loans represent classified loans that management is closely monitoring for credit quality. These loans had more significant credit quality deterioration as of September 30, 2014 and December 31, 2013 and are doubtful for full collection. |
Impaired: |
Impaired loans represent classified loans that management is closely monitoring for credit quality. A loan is classified as impaired when it is probable that the Company will be unable to collect all amounts due. |
The following table presents the Company’s loans by risk rating at September 30, 2014. |
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| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Construction | | | Commercial | | | Commercial | | | | | | | | | | | | | | | | | | | | | |
and land | and | real | | | | | | | | | | | | | | | | | | | | |
development | industrial | estate | | | | | | | | | | | | | | | | | | | | |
| | (Dollars in thousands) | | | | | | | | | | | | | | | | | | | | | |
Grade: | | | | | | | | | | | | | | | | | | | | | | | | |
1-3 (Pass) | | $ | 17,808 | | | $ | 180,059 | | | $ | 697,509 | | | | | | | | | | | | | | | | | | | | | |
4 (Monitor) | | | 7,177 | | | | 472 | | | | 645 | | | | | | | | | | | | | | | | | | | | | |
5 (Substandard) | | | — | | | | — | | | | — | | | | | | | | | | | | | | | | | | | | | |
6 (Doubtful) | | | — | | | | — | | | | — | | | | | | | | | | | | | | | | | | | | | |
Impaired | | | 354 | | | | 1,096 | | | | 4,740 | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total | | $ | 25,339 | | | $ | 181,627 | | | $ | 702,894 | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
The following table presents the Company’s loans by risk rating at December 31, 2013. |
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| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Construction | | | Commercial | | | Commercial | | | | | | | | | | | | | | | | | | | | | |
and land | and | real | | | | | | | | | | | | | | | | | | | | |
development | industrial | estate | | | | | | | | | | | | | | | | | | | | |
| | (Dollars in thousands) | | | | | | | | | | | | | | | | | | | | | |
Grade: | | | | | | | | | | | | | | | | | | | | | | | | |
1-3 (Pass) | | $ | 25,138 | | | $ | 90,563 | | | $ | 707,461 | | | | | | | | | | | | | | | | | | | | | |
4 (Monitor) | | | 7,312 | | | | 472 | | | | 1,346 | | | | | | | | | | | | | | | | | | | | | |
5 (Substandard) | | | — | | | | — | | | | — | | | | | | | | | | | | | | | | | | | | | |
6 (Doubtful) | | | — | | | | — | | | | — | | | | | | | | | | | | | | | | | | | | | |
Impaired | | | 608 | | | | 1,367 | | | | 4,520 | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total | | $ | 33,058 | | | $ | 92,402 | | | $ | 713,327 | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
The Company utilized payment performance as credit quality indicators for residential real estate, consumer and overdrafts, and the home equity portfolio. The indicators are depicted in the table “aging of past due loans,” below. |
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Further information pertaining to the allowance for loan losses at September 30, 2014 follows: |
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| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Accruing | | | Non Accrual | | | Accrual | | | Total | | | Current Loans | | | Total | | | | | | | | | |
30-89 Days | Greater | Past Due | | | | | | | | |
Past Due | Than | | | | | | | | | |
| 90 Days | | | | | | | | | |
| | | | | | | | (Dollars in thousands) | | | | | | | | | | | | |
Construction and land development | | $ | — | | | $ | 354 | | | $ | — | | | $ | 354 | | | $ | 24,985 | | | $ | 25,339 | | | | | | | | | |
Commercial and industrial | | | 895 | | | | 418 | | | | — | | | | 1,313 | | | | 180,314 | | | | 181,627 | | | | | | | | | |
Commercial real estate | | | 1,608 | | | | 2,787 | | | | — | | | | 4,395 | | | | 698,499 | | | | 702,894 | | | | | | | | | |
Residential real estate | | | 378 | | | | 2,197 | | | | — | | | | 2,575 | | | | 266,352 | | | | 268,927 | | | | | | | | | |
Consumer and overdrafts | | | 5 | | | | 8 | | | | — | | | | 13 | | | | 10,240 | | | | 10,253 | | | | | | | | | |
Home equity | | | 1,072 | | | | 254 | | | | — | | | | 1,326 | | | | 146,267 | | | | 147,593 | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total | | $ | 3,958 | | | $ | 6,018 | | | $ | — | | | $ | 9,976 | | | $ | 1,326,657 | | | $ | 1,336,633 | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Further information pertaining to the allowance for loan losses at December 31, 2013 follows: |
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| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Accruing | | | Non Accrual | | | Accrual | | | Total | | | Current Loans | | | Total | | | | | | | | | |
30-89 Days | Greater | Past Due | | | | | | | | |
Past Due | Than | | | | | | | | | |
| 90 | | | | | | | | | |
| Days | | | | | | | | | |
| | | | | | | | (Dollars in thousands) | | | | | | | | | | | | |
Construction and land development | | $ | — | | | $ | 500 | | | $ | — | | | $ | 500 | | | $ | 32,558 | | | $ | 33,058 | | | | | | | | | |
Commercial and industrial | | | 112 | | | | 706 | | | | — | | | | 818 | | | | 91,584 | | | | 92,402 | | | | | | | | | |
Commercial real estate | | | 1,496 | | | | 306 | | | | — | | | | 1,802 | | | | 711,525 | | | | 713,327 | | | | | | | | | |
Residential real estate | | | 2,232 | | | | 1,034 | | | | — | | | | 3,266 | | | | 282,775 | | | | 286,041 | | | | | | | | | |
Consumer and overdrafts | | | 11 | | | | 3 | | | | — | | | | 14 | | | | 9,644 | | | | 9,658 | | | | | | | | | |
Home equity | | | 1,710 | | | | — | | | | — | | | | 1,710 | | | | 128,567 | | | | 130,277 | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total | | $ | 5,561 | | | $ | 2,549 | | | $ | — | | | $ | 8,110 | | | $ | 1,256,653 | | | $ | 1,264,763 | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
A loan is impaired when, based on current information and events, it is probable that a creditor will be unable to collect all amounts due according to the contractual terms of the loan agreement. When a loan is impaired, the Company measures impairment based on the present value of expected future cash flows discounted at the loan’s effective interest rate, except that as a practical expedient, the Company measures impairment based on a loan’s observable market price, or the fair value of the collateral if the loan is collateral dependent. Loans are charged-off when management believes that the collectability of the loan’s principal is not probable. The specific factors that management considers in making the determination that the collectability of the loan’s principal is not probable include; the delinquency status of the loan, the fair value of the collateral, if secured, and the financial strength of the borrower and/or guarantors. For collateral dependent loans, the amount of the recorded investment in a loan that exceeds the fair value of the collateral is charged-off against the allowance for loan losses in lieu of an allocation of a specific allowance amount when such an amount has been identified definitively as uncollectible. The Company’s policy for recognizing interest income on impaired loans is contained within Note 1 of the consolidated financial statements contained in the Company’s Annual Report for the fiscal year ended December 31, 2013. |
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The following is information pertaining to impaired loans for September 30, 2014: |
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| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Carrying | | | Unpaid | | | Required | | | Average | | | Interest | | | Average | | | Interest | | | | | |
Value | Principal | Reserve | Carrying Value | Income | Carrying Value | Income | | | | |
| Balance | | For 3 Months | Recognized For | For 9 Months | Recognized For | | | | |
| | | Ending 9/30/14 | 3 Months | Ending 9/30/14 | 9 Months | | | | |
| | | | Ending 9/30/14 | | Ending 9/30/14 | | | | |
| | (Dollars in thousands) | | | | | |
With no required reserve recorded: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Construction and land development | | $ | — | | | $ | — | | | $ | — | | | $ | — | | | $ | — | | | $ | 225 | | | $ | — | | | | | |
Commercial and industrial | | | 11 | | | | 42 | | | | — | | | | 11 | | | | — | | | | 53 | | | | — | | | | | |
Commercial real estate | | | 392 | | | | 396 | | | | — | | | | 396 | | | | — | | | | 175 | | | | — | | | | | |
Residential real estate | | | — | | | | — | | | | — | | | | 18 | | | | — | | | | 72 | | | | — | | | | | |
Consumer | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | | |
Home equity | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total | | $ | 403 | | | $ | 438 | | | $ | — | | | $ | 425 | | | $ | — | | | $ | 525 | | | $ | — | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
With required reserve recorded: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Construction and land development | | $ | 354 | | | $ | 3,400 | | | $ | 272 | | | $ | 355 | | | $ | — | | | $ | 207 | | | $ | — | | | | | |
Commercial and industrial | | | 1,085 | | | | 1,337 | | | | 348 | | | | 1,078 | | | | 8 | | | | 1,095 | | | | 24 | | | | | |
Commercial real estate | | | 4,348 | | | | 4,440 | | | | 648 | | | | 4,492 | | | | 39 | | | | 4,443 | | | | 113 | | | | | |
Residential real estate | | | 1,549 | | | | 1,549 | | | | 152 | | | | 1,536 | | | | 3 | | | | 1,193 | | | | 8 | | | | | |
Consumer | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | | |
Home equity | | | 93 | | | | 93 | | | | 93 | | | | 93 | | | | — | | | | 94 | | | | — | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total | | $ | 7,429 | | | $ | 10,819 | | | $ | 1,513 | | | $ | 7,554 | | | $ | 50 | | | $ | 7,032 | | | $ | 145 | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Construction and land development | | $ | 354 | | | $ | 3,400 | | | $ | 272 | | | $ | 355 | | | $ | — | | | $ | 432 | | | $ | — | | | | | |
Commercial and industrial | | | 1,096 | | | | 1,379 | | | | 348 | | | | 1,089 | | | | 8 | | | | 1,148 | | | | 24 | | | | | |
Commercial real estate | | | 4,740 | | | | 4,836 | | | | 648 | | | | 4,888 | | | | 39 | | | | 4,618 | | | | 113 | | | | | |
Residential real estate | | | 1,549 | | | | 1,549 | | | | 152 | | | | 1,554 | | | | 3 | | | | 1,265 | | | | 8 | | | | | |
Consumer | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | | |
Home equity | | | 93 | | | | 93 | | | | 93 | | | | 93 | | | | — | | | | 94 | | | | — | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total | | $ | 7,832 | | | $ | 11,257 | | | $ | 1,513 | | | $ | 7,979 | | | $ | 50 | | | $ | 7,557 | | | $ | 145 | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
The following is information pertaining to impaired loans for September 30, 2013: |
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Carrying Value | | | Unpaid | | | Required | | | Average | | | Interest | | | Average | | | Interest | | | | | |
Principal | Reserve | Carrying Value | Income | Carrying Value | Income | | | | |
Balance | | For 3 Months | Recognized For | For 9 Months | Recognized For | | | | |
| | Ending 9/30/13 | 3 Months | Ending 9/30/13 | 9 Months | | | | |
| | | Ending 9/30/13 | | Ending 9/30/13 | | | | |
| | (Dollars in thousands) | | | | | |
With no required reserve recorded: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Construction and land development | | $ | — | | | $ | — | | | $ | — | | | $ | — | | | $ | — | | | $ | — | | | $ | — | | | | | |
Commercial and industrial | | | 264 | | | | 294 | | | | — | | | | 239 | | | | — | | | | 390 | | | | 1 | | | | | |
Commercial real estate | | | 218 | | | | 218 | | | | — | | | | 126 | | | | — | | | | 133 | | | | — | | | | | |
Residential real estate | | | 254 | | | | 263 | | | | — | | | | 260 | | | | — | | | | 145 | | | | — | | | | | |
Consumer | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | | |
Home equity | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total | | $ | 736 | | | $ | 775 | | | $ | — | | | $ | 625 | | | $ | 1 | | | $ | 668 | | | $ | 1 | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
With required reserve recorded: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Construction and land development | | $ | 1,500 | | | $ | 3,292 | | | $ | 1,000 | | | $ | 1,500 | | | $ | — | | | $ | 1,500 | | | $ | — | | | | | |
Commercial and industrial | | | 868 | | | | 1,101 | | | | 90 | | | | 885 | | | | 12 | | | | 864 | | | | 29 | | | | | |
Commercial real estate | | | 4,470 | | | | 4,558 | | | | 445 | | | | 2,796 | | | | 26 | | | | 2,394 | | | | 72 | | | | | |
Residential real estate | | | 897 | | | | 979 | | | | 139 | | | | 901 | | | | — | | | | 853 | | | | — | | | | | |
Consumer | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | | |
Home equity | | | 95 | | | | 95 | | | | 95 | | | | 95 | | | | — | | | | 96 | | | | — | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total | | $ | 7,830 | | | $ | 10,025 | | | $ | 1,769 | | | $ | 6,177 | | | $ | 38 | | | $ | 5,707 | | | $ | 101 | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Construction and land development | | $ | 1,500 | | | $ | 3,292 | | | $ | 1,000 | | | $ | 1,500 | | | $ | — | | | $ | 1,500 | | | $ | — | | | | | |
Commercial and industrial | | | 1,132 | | | | 1,395 | | | | 90 | | | | 1,124 | | | | 12 | | | | 1,254 | | | | 30 | | | | | |
Commercial real estate | | | 4,688 | | | | 4,776 | | | | 445 | | | | 2,922 | | | | 26 | | | | 2,527 | | | | 72 | | | | | |
Residential real estate | | | 1,151 | | | | 1,242 | | | | 139 | | | | 1,161 | | | | — | | | | 998 | | | | — | | | | | |
Consumer | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | | |
Home equity | | | 95 | | | | 95 | | | | 95 | | | | 95 | | | | — | | | | 96 | | | | — | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total | | $ | 8,566 | | | $ | 10,800 | | | $ | 1,769 | | | $ | 6,802 | | | $ | 38 | | | $ | 6,375 | | | $ | 102 | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Troubled Debt Restructurings were identified as a modification in which a concession was granted to a customer who is having financial difficulties. This concession may be below market rate, longer amortization/term, and a lower payment amount. The present value calculation of the modification did not result in an increase in the allowance for these loans beyond any previously established allocations. There was one commercial real estate troubled debt restructuring, totaling $2.2 million during the period ended September 30, 2014, that subsequently defaulted. There was one commercial and industrial troubled debt restructuring that occurred during the three and nine month period ended September 30, 2014. The pre-modification and post-modification outstanding recorded investment amounted to $23,811 and $23,761, respectively. The term of the loan was extended and the financial impact of the modification for the performing commercial and industrial loan was a $50 increase in principal payments for the quarter and year-to-date ended September 30, 2014. |
Troubled Debt Restructurings occurring during the three and nine month periods ended September 30, 2013: |
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| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Number | | | Pre-modification | | | Post- | | | | | | | | | | | | | | | | | | | | | |
of | outstanding | modification | | | | | | | | | | | | | | | | | | | | |
Contracts | recorded | outstanding | | | | | | | | | | | | | | | | | | | | |
| investment | recorded | | | | | | | | | | | | | | | | | | | | |
| | investment | | | | | | | | | | | | | | | | | | | | |
| | (Dollars in thousands) | | | | | | | | | | | | | | | | | | | | | |
Construction and land development | | | 1 | | | $ | 108 | | | $ | 108 | | | | | | | | | | | | | | | | | | | | | |
Commercial and industrial | | | 1 | | | | 41 | | | | 41 | | | | | | | | | | | | | | | | | | | | | |
Commercial real estate | | | 1 | | | | 2,247 | | | | 2,242 | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total | | | 3 | | | $ | 2,396 | | | $ | 2,391 | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
The loans were modified, for the loans, by reducing interest rates as well as extending term for the commercial and industrial loan. The financial impact of the modifications for performing commercial and industrial loans were $366 reduction in principal and $217 reduction in interest payments for the quarter and year-to-date ended September 30, 2013. The financial impact of the modifications for performing commercial real estate loans were $1,786 increase in principal and $7,907 reduction in interest payments for the quarter and year-to-date ended September 30, 2013. The financial impact of the modifications for performing construction and land development loans were $530 reduction in principal and $415 reduction in interest payments for the quarter and year-to-date ended September 30, 2013. |