Loans, Notes, Trade and Other Receivables Disclosure [Text Block] | ( 5 Composition of loans by primary loan portfolio class follows: December 31, (in thousands) 2019 2018 Commercial and industrial $ 870,511 $ 833,524 Construction and development, excluding undeveloped land(1) 213,822 225,050 Undeveloped land 46,360 30,092 Real estate mortgage: Commercial investment 736,618 588,610 Owner occupied commercial 473,783 426,373 1-4 family residential 334,358 276,017 Home equity - first lien 48,620 49,500 Home equity - junior lien 73,477 70,947 Subtotal: Real estate mortgage 1,666,856 1,411,447 Consumer 47,467 48,058 Total loans(2) $ 2,845,016 $ 2,548,171 ( 1 no ( 2 Fees and costs of originating loans are deferred at origination and amortized over the life of the loan. Loan balances reported herein include deferred loan origination fees, net of deferred loan costs. At December 31, 2019 2018, Bancorp’s credit exposure is diversified with secured and unsecured loans to individuals and businesses. No 10% Bancorp occasionally enters into loan participation agreements with other banks in the ordinary course of business to diversify credit risk. For certain sold participation loans, Bancorp has retained effective control of the loans, typically by restricting the participating institutions from pledging or selling their share of the loan without permission from Bancorp. GAAP requires the participated portion of these loans to be recorded as secured borrowings. The participated portions of these loans are included in the C&I totals above with a corresponding liability reflected in other liabilities. At December 31, 2019 2018, Loans to directors and their related interests, including loans to companies for which directors are principal owners and executive officers are presented in the following table. Years ended December 31, (in thousands) 2019 2018 Balance as of January 1 $ 52,687 $ 629 Effect of change in composition of directors and executive officers — 51,415 Repayment of term loans (184 ) — Changes in balances of revolving lines of credit (9,279 ) 643 Balance as of December 31 $ 43,224 $ 52,687 Loans totaling $0 and $500,000 to directors and executive officers were past due as of December 31, 2019 2018. The following table summarizes loans acquired in Bancorp’s May 1, 2019 December 31, 2019. May 1, 2019 Contractual Non-accretable Accretable Acquisition-day (in thousands) receivable amount amount fair value Commercial and industrial $ 8,249 $ — $ (23 ) $ 8,226 Construction and development 10,764 — 43 10,807 Raw Land 7,974 — 43 8,017 Real estate mortgage: Commercial real estate 84,219 — (456 ) 83,763 1-4 family residential 50,556 — 322 50,878 Home equity - first lien 196 — 3 199 Home equity - junior lien 679 — 5 684 Subtotal: Real estate mortgage 135,650 — (126 ) 135,524 Consumer 1,528 — (73 ) 1,455 Total loans ASC 310-20 164,165 — (136 ) 164,029 Commercial and industrial Construction and development — — — — Raw Land — — — — Real estate mortgage: Commercial real estate 1,351 (1,351 ) — — 1-4 family residential 228 (228 ) — — Home equity - first lien — — — — Home equity - junior lien — — — — Subtotal: Real estate mortgage 1,579 (1,579 ) — — Consumer — — — — Total loans ASC 310 purchased- credit-impaired loans 1,579 (1,579 ) — — Total loans $ 165,744 $ (1,579 ) $ (136 ) $ 164,029 PCI Loans The Bank acquired PCI loans on May 1, 2019 2013 310 30, Loans and Debt Securities Acquired with Deteriorated Credit Quality 12 Management utilized the following criteria in determining which loans were classified as PCI loans for its KSB acquisition: ● Loans classified by management as substandard, doubtful or loss ● Loans classified as non-accrual when acquired ● Loans past due 90 ● Loans for which management assigned a non-accretable mark The following table presents loans acquired during 2019 not December 31, (in thousands) 2019 Contractually-required principal $ 1,579 Non-accretable amount (1,579 ) Accretable amount — Carrying value of loans $ - The following table presents a rollforward of the accretable amount on all PCI loans: Years ended December 31, (in thousands) 2019 2018 Balance, beginning of period $ (69 ) $ (106 ) Transfers between non-accretable and accretable — — Net accretion into interest income on loans, including loan fees 69 37 Balance, end of period $ - $ (69 ) Credit Quality Indicators Consistent with regulatory guidance, Bancorp categorizes loans into credit risk categories based on relevant information about the ability of borrowers to service their debt such as: current financial information, historical payment experience, credit documentation, public information and current economic trends. Pass-rated loans included all risk-rated loans other than those classified as OAEM, substandard, and doubtful, which are defined below: ● OAEM: Loans classified as OAEM have potential weaknesses requiring management's heightened attention. These potential weaknesses may ● Substandard: Loans classified as substandard are inadequately protected by the paying capacity of the obligor or of collateral pledged, if any. Loans so classified have well-defined weaknesses that jeopardize ultimate repayment of the debt. Default is a distinct possibility if the deficiencies are not ● Substandard non-performing: Loans classified as substandard non-performing have all the characteristics of substandard loans and have been placed on non-accrual status or have been accounted for as TDRs. Loans are placed on non-accrual status when prospects for recovering both principal and accrued interest are considered doubtful or when a default of principal or interest has existed for 90 ● Doubtful: Loans classified as doubtful have all the weaknesses inherent in those classified as substandard, with the added characteristic that the weaknesses make collection or repayment in full, on the basis of currently existing facts, conditions and values, highly questionable and improbable. Internally assigned risk grades of loans by loan portfolio class classification category follows: (in thousands) Substandard Total December 31, 2019 Pass OAEM Substandard Non-performing Doubtful Loans Commercial and industrial $ 840,105 $ 704 $ 21,500 $ 8,202 $ — $ 870,511 Construction and development, excluding undeveloped land 213,822 — — — — 213,822 Undeveloped land 46,360 — — — — 46,360 Real estate mortgage: Commercial investment 722,747 6,459 6,275 1,137 — 736,618 Owner occupied commercial 460,981 1,375 9,050 2,377 — 473,783 1-4 family residential 332,294 1,701 122 241 — 334,358 Home equity - first lien 48,620 — — — — 48,620 Home equity - junior lien 73,273 — 17 187 — 73,477 Subtotal: Real estate mortgage 1,637,915 9,535 15,464 3,942 — 1,666,856 Consumer 47,429 — 38 — — 47,467 Total $ 2,785,631 $ 10,239 $ 37,002 $ 12,144 $ — $ 2,845,016 (in thousands) Substandard Total December 31, 2018 Pass OAEM Substandard Non-performing Doubtful Loans Commercial and industrial $ 803,073 $ 11,516 $ 18,703 $ 232 $ — $ 833,524 Construction and development, excluding undeveloped land 220,532 4,200 — 318 — 225,050 Undeveloped land 29,618 — — 474 — 30,092 Real estate mortgage: Commercial investment 586,543 1,815 15 237 — 588,610 Owner occupied commercial 411,722 9,030 4,500 1,121 — 426,373 1-4 family residential 273,537 1,544 162 774 — 276,017 Home equity - first lien 49,500 — — — — 49,500 Home equity - junior lien 70,437 249 19 242 — 70,947 Subtotal: Real estate mortgage 1,391,739 12,638 4,696 2,374 — 1,411,447 Consumer 48,058 — — — — 48,058 Total $ 2,493,020 $ 28,354 $ 23,399 $ 3,398 $ — $ 2,548,171 The following tables present the activity in the allowance by loan portfolio class: Type of loan Construction and development, Commercial excluding and undeveloped Undeveloped Real estate (in thousands) industrial land land mortgage Consumer Total Balance, January 1, 2019 $ 11,965 $ 1,760 $ 752 $ 10,681 $ 376 $ 25,534 Provision (credit) 684 (644 ) 34 1,021 (95 ) 1,000 Charge-offs (94 ) — — (38 ) (552 ) (684 ) Recoveries 267 203 — 100 371 941 Balance, December 31, 2019 $ 12,822 $ 1,319 $ 786 $ 11,764 $ 100 $ 26,791 Type of loan Construction and development, Commercial excluding and undeveloped Undeveloped Real estate (in thousands) industrial land land mortgage Consumer Total Balance, January 1, 2018 $ 11,276 $ 1,724 $ 521 $ 11,012 $ 352 $ 24,885 Provision (credit) 2,539 36 231 (261 ) 160 2,705 Charge-offs (2,404 ) — — (132 ) (476 ) (3,012 ) Recoveries 554 — — 62 340 956 Balance, December 31, 2018 $ 11,965 $ 1,760 $ 752 $ 10,681 $ 376 $ 25,534 Type of loan Construction and development, Commercial excluding and undeveloped Undeveloped Real estate (in thousands) industrial land land mortgage Consumer Total Balance, January 1, 2017 $ 10,483 $ 1,923 $ 684 $ 10,573 $ 344 $ 24,007 Provision (credit) 2,373 (199 ) (163 ) 383 156 2,550 Charge-offs (1,782 ) — — (98 ) (549 ) (2,429 ) Recoveries 202 — — 154 401 757 Balance, December 31, 2017 $ 11,276 $ 1,724 $ 521 $ 11,012 $ 352 $ 24,885 The considerations by Bancorp in computing its allowance are determined based on the various risk characteristics of each loan segment. Relevant risk characteristics are as follows: ● C&I: Loans in this category are made to businesses. Generally these loans are secured by assets of the business and repayment is expected from cash flows of the business. A decline in the strength of the business or a weakened economy and decreased consumer and/or business spending may ● C&D, excluding undeveloped land: Loans in this category primarily include owner-occupied and investment C&D loans and commercial development projects. In most cases, C&D loans require only interest to be paid during the construction period. Upon completion or stabilization, C&D loans generally convert to permanent financing in the real estate mortgage segment, requiring principal amortization. Repayment of development loans is derived from sale of lots or units. Credit risk is affected by construction delays, cost overruns, market conditions and availability of permanent financing; to the extent such permanent financing is not ● Undeveloped land: Loans in this category are secured by land acquired for development by the borrower, but for which no not ● Real estate mortgage: Loans in this category are made to and secured by owner-occupied residential real estate, owner-occupied real estate used for business purposes, and income-producing investment properties. Underlying properties are generally located in Bancorp's primary market areas. For owner occupied residential and owner-occupied CRE, repayment is dependent on financial strength of the borrower. A decline in the strength of the business, weakened economy, unemployment, decreased consumer and/or business spending and real estate prices may may ● Consumer: Loans in this category may The following table presents the recorded investment in non-accrual and loans past due 90 Past Due 90-Days-or-More Non-accrual and Still Accruing Interest (in thousands) December 31, 2019 December 31, 2018 December 31, 2019 December 31, 2018 Commercial and industrial $ 8,202 $ 192 $ — $ 12 Construction and development, excluding undeveloped land — 318 — — Undeveloped land — 474 — — Real estate mortgage: Commercial investment 740 138 396 99 Owner occupied commercial 2,278 586 — 535 1-4 family residential 123 760 104 — Home equity - first lien — — — — Home equity - junior lien 151 143 35 99 Subtotal: Real estate mortgage 3,292 1,627 535 733 Consumer — — — — Total loans $ 11,494 $ 2,611 $ 535 $ 745 In the course of working with borrowers, Bancorp may not not December 31, 2019 2018. December 31, 2019 December 31, 2018 Specific Additional Specific Additional reserve commitment reserve commitment (in thousands) Balance allocation to lend Balance allocation to lend Commercial and industrial $ 21 $ 21 $ — $ 28 $ 28 $ — 1-4 family residential 13 13 — 14 14 — Total TDRs $ 34 $ 34 $ — $ 42 $ 42 $ — Impaired loans include non-accrual loans and loans past due 90 As of December 31, 2019 1 4 December 31, 2018. The following tables present the balance in the recorded investment in loans and by portfolio loan class and based on impairment evaluation method: (in thousands) Loans Allowance December 31, 2019 Loans individually evaluated for impairment Loans collectively evaluated for impairment Loans acquired with deteriorated credit quality Total loans Loans individually evaluated for impairment Loans collectively evaluated for impairment Loans acquired with deteriorated credit quality Total allowance Commercial and industrial $ 8,223 $ 862,288 $ — $ 870,511 $ 1,150 $ 11,672 $ — $ 12,822 Construction and development, excluding undeveloped land — 213,822 — 213,822 — 1,319 — 1,319 Undeveloped land — 46,360 — 46,360 — 786 — 786 Real estate mortgage 3,307 1,663,549 — 1,666,856 13 11,751 — 11,764 Consumer — 47,467 — 47,467 — 100 — 100 Total $ 11,530 $ 2,833,486 $ — $ 2,845,016 $ 1,163 $ 25,628 $ — $ 26,791 (in thousands) Loans Allowance December 31, 2018 Loans individually evaluated for impairment Loans collectively evaluated for impairment Loans acquired with deteriorated credit quality Total loans Loans individually evaluated for impairment Loans collectively evaluated for impairment Loans acquired with deteriorated credit quality Total allowance Commercial and industrial $ 220 $ 833,304 $ — $ 833,524 $ 28 $ 11,937 $ — $ 11,965 Construction and development, excluding undeveloped land 318 224,732 — 225,050 — 1,760 — 1,760 Undeveloped land 474 29,618 — 30,092 — 752 — 752 Real estate mortgage 1,641 1,409,806 — 1,411,447 14 10,667 — 10,681 Consumer — 48,058 — 48,058 — 376 — 376 Total $ 2,653 $ 2,545,518 $ — $ 2,548,171 $ 42 $ 25,492 $ — $ 25,534 The following table’s present loans individually evaluated for impairment by loan portfolio class: As of Twelve Months Ended December 31, 2019 December 31, 2019 Unpaid Average Interest Recorded principal Related recorded income (in thousands) investment balance allowance investment recognized Impaired loans with no related allowance: Commercial and industrial $ 174 $ 174 $ — $ 166 $ — Construction and development, excluding undeveloped land — — — 64 — Undeveloped land — — — 95 — Real estate mortgage Commercial investment 741 741 — 448 — Owner occupied commercial 2,278 2,736 — 1,437 — 1-4 family residential 124 124 — 516 — Home equity - first lien — — — — — Home equity - junior lien 151 151 — 293 — Subtotal: Real estate mortgage 3,294 3,752 — 2,694 — Consumer — — — — — Subtotal $ 3,468 $ 3,926 $ — $ 3,019 $ — Impaired loans with an allowance: Commercial and industrial $ 8,049 $ 8,049 $ 1,150 $ 1,631 $ — Construction and development, excluding undeveloped land — — — — — Undeveloped land — — — — — Real estate mortgage Commercial investment — — — — — Owner occupied commercial — — — — — 1-4 family residential 13 13 13 13 — Home equity - first lien — — — — — Home equity - junior lien — — — — — Subtotal: Real estate mortgage 13 13 13 13 — Consumer — — — — — Subtotal $ 8,062 $ 8,062 $ 1,163 $ 1,644 $ — Total: Commercial and industrial $ 8,223 $ 8,223 $ 1,150 $ 1,797 $ — Construction and development, excluding undeveloped land — — — 64 — Undeveloped land — — — 95 — Real estate mortgage Commercial investment 741 741 — 448 — Owner occupied commercial 2,278 2,736 — 1,437 — 1-4 family residential 137 137 13 529 — Home equity - first lien — — — — — Home equity - junior lien 151 151 — 293 — Subtotal: Real estate mortgage 3,307 3,765 13 2,707 — Consumer — — — — — Total impaired loans $ 11,530 $ 11,988 $ 1,163 $ 4,663 $ — As of Twelve Months Ended December 31, 2018 December 31, 2018 Unpaid Average Interest Recorded principal Related recorded income (in thousands) investment balance allowance investment recognized Impaired loans with no related allowance: Commercial and industrial $ 192 $ 707 $ — $ 161 $ — Construction and development, excluding undeveloped land 318 489 — 437 — Undeveloped land 474 506 — 474 — Real estate mortgage Commercial investment 138 138 — 35 — Owner occupied commercial 586 1,023 — 1,503 — 1-4 family residential 760 760 — 1,242 — Home equity - first lien — — — — — Home equity - junior lien 143 143 — 73 — Subtotal: Real estate mortgage 1,627 2,064 — 2,853 — Consumer — — — 23 — Subtotal $ 2,611 $ 3,766 $ — $ 3,948 $ — Impaired loans with an allowance: Commercial and industrial $ 28 $ 28 $ 28 $ 1,851 $ 2 Construction and development, excluding undeveloped land — — — — — Undeveloped land — — — 24 — Real estate mortgage Commercial investment — — — — — Owner occupied commercial — — — 897 — 1-4 family residential 14 14 14 14 1 Home equity - first lien — — — — — Home equity - junior lien — — — — — Subtotal: Real estate mortgage 14 14 14 911 1 Consumer — — — — — Subtotal $ 42 $ 42 $ 42 $ 2,786 $ 3 Total: Commercial and industrial $ 220 $ 735 $ 28 $ 2,012 $ 2 Construction and development, excluding undeveloped land 318 489 — 437 — Undeveloped land 474 506 — 498 — Real estate mortgage Commercial investment 138 138 — 35 — Owner occupied commercial 586 1,023 — 2,400 — 1-4 family residential 774 774 14 1,256 1 Home equity - first lien — — — — — Home equity - junior lien 143 143 — 73 — Subtotal: Real estate mortgage 1,641 2,078 14 3,764 1 Consumer — — — 23 — Total impaired loans $ 2,653 $ 3,808 $ 42 $ 6,734 $ 3 As of Twelve Months Ended December 31, 2017 December 31, 2017 Unpaid Average Interest Recorded principal Related recorded income (in thousands) investment balance allowance investment recognized Impaired loans with no related allowance: Commercial and industrial $ 1,142 $ 2,202 $ — $ 411 $ — Construction and development, excluding undeveloped land 664 834 — 559 — Undeveloped land 474 506 — 425 — Real estate mortgage Commercial investment 52 53 — 110 — Owner occupied commercial 3,332 3,789 — 1,678 — 1-4 family residential 1,637 1,657 — 935 — Home equity - first lien — — — — — Home equity - junior lien 31 31 — 186 — Subtotal: Real estate mortgage 5,052 5,530 — 2,909 — Consumer — — — — — Subtotal $ 7,332 $ 9,072 $ — $ 4,304 $ — Impaired loans with an allowance: Commercial and industrial $ 34 $ 34 $ 34 $ 1,882 $ 78 Construction and development, excluding undeveloped land — — — — — Undeveloped land — — — 48 — Real estate mortgage Commercial investment — — — — — Owner occupied commercial — — — — — 1-4 family residential 14 14 14 5 — Home equity - first lien — — — — — Home equity - junior lien — — — — — Subtotal: Real estate mortgage 14 14 14 5 — Consumer — — — 46 — Subtotal $ 48 $ 48 $ 48 $ 1,981 $ 78 Total: Commercial and industrial $ 1,176 $ 2,236 $ 34 $ 2,293 $ 78 Construction and development, excluding undeveloped land 664 834 — 559 — Undeveloped land 474 506 — 473 — Real estate mortgage Commercial investment 52 53 — 110 — Owner occupied commercial 3,332 3,789 — 1,678 — 1-4 family residential 1,651 1,671 14 940 — Home equity - first lien — — — — — Home equity - junior lien 31 31 — 186 — Subtotal: Real estate mortgage 5,066 5,544 14 2,914 — Consumer — — — 46 — Total impaired loans $ 7,380 $ 9,120 $ 48 $ 6,285 $ 78 Differences between recorded investment amounts and unpaid principal balance amounts less related allowance are due to partial charge-offs which have occurred over the lives of certain loans. Interest paid on impaired or non-accrual loans that was used to reduce principal was $552,000, $93,000 and $338,000 in 2019, 2018 2017. 2019, 2018 2017. 2019, 2018, 2017. The following table presents the aging of the recorded investment in loans by portfolio class: 90 or More Days Past Due (in thousands) 30-59 Days 60-89 days (includes all Total Total December 31, 2019 Current Past Due Past Due non-accrual) Past Due Loans Commercial and industrial $ 861,860 $ 253 $ 194 $ 8,204 $ 8,651 $ 870,511 Construction and development, excluding undeveloped land 213,766 6 50 — 56 213,822 Undeveloped land 46,360 — — — — 46,360 Real estate mortgage: Commercial investment 735,387 94 — 1,137 1,231 736,618 Owner occupied commercial 470,951 467 86 2,279 2,832 473,783 1-4 family residential 332,718 1,368 33 239 1,640 334,358 Home equity - first lien 48,441 179 — — 179 48,620 Home equity - junior lien 72,995 196 100 186 482 73,477 Subtotal: Real estate mortgage 1,660,492 2,304 219 3,841 6,364 1,666,856 Consumer 47,379 84 4 — 88 47,467 Total $ 2,829,857 $ 2,647 $ 467 $ 12,045 $ 15,159 $ 2,845,016 90 or More Days Past Due (in thousands) 30-59 Days 60-89 days (includes all Total Total December 31, 2018 Current Past Due Past Due non-accrual) Past Due Loans Commercial and industrial $ 832,923 $ 197 $ 200 $ 204 $ 601 $ 833,524 Construction and development, excluding undeveloped land 224,732 — — 318 318 225,050 Undeveloped land 29,552 66 — 474 540 30,092 Real estate mortgage: Commercial investment 586,884 1,382 107 237 1,726 588,610 Owner occupied commercial 421,143 2,732 1,377 1,121 5,230 426,373 1-4 family residential 274,547 374 336 760 1,470 276,017 Home equity - first lien 49,321 179 — — 179 49,500 Home equity - junior lien 70,467 182 56 242 480 70,947 Subtotal: Real estate mortgage 1,402,362 4,849 1,876 2,360 9,085 1,411,447 Consumer 48,058 — — — — 48,058 Total $ 2,537,627 $ 5,112 $ 2,076 $ 3,356 $ 10,544 $ 2,548,171 |