Financing Receivables [Text Block] | Note 4 . Credit Quality The Company uses a risk grading matrix to assign a risk grade to each loan in its portfolio. Loan risk ratings may ● Pass -- This grade is assigned to loans with acceptable credit quality and risk. The Company further segments this grade based on borrower characteristics that include capital strength, earnings stability, liquidity, leverage, and industry conditions. ● Special Mention -- This grade is assigned to loans that require an above average degree of supervision and attention. These loans have the characteristics of an asset with acceptable credit quality and risk; however, adverse economic or financial conditions exist that create potential weaknesses deserving of management ’s close attention. If potential weaknesses are not may ● Substandard -- This grade is assigned to loans that have well defined weaknesses that may ● Doubtful -- This grade is assigned to loans that have the weaknesses inherent in substandard loans; however, the weaknesses are so severe that collection or liquidation in full is unlikely based on current facts, conditions, and values. Due to certain specific pending factors, the amount of loss cannot yet be determined. ● Loss -- This grade is assigned to loans that will be charged off or charged down when payments, including the timing and value of payments, are uncertain. This risk grade does not no not may The following tables present the recorded investment of the loan portfolio, by loan class and credit quality, as of the dates indicated. Losses on covered loans are generally reimbursable by the FDIC at the applicable loss share percentage, 80%; September 30, 2017 Special (Amounts in thousands) Pass Mention Substandard Doubtful Loss Total Non-covered loans Commercial loans Construction, development, and other land $ 69,257 $ 2,791 $ 904 $ - $ - $ 72,952 Commercial and industrial 85,368 1,844 2,972 - - 90,184 Multi-family residential 119,399 5,882 716 - - 125,997 Single family non-owner occupied 132,000 6,839 4,374 - - 143,213 Non-farm, non-residential 593,809 11,126 8,243 202 - 613,380 Agricultural 5,743 235 118 - - 6,096 Farmland 25,097 153 2,647 - - 27,897 Consumer real estate loans Home equity lines 100,375 850 1,663 - - 102,888 Single family owner occupied 471,378 5,705 24,159 - - 501,242 Owner occupied construction 46,802 - 232 - - 47,034 Consumer and other loans Consumer loans 70,459 27 209 - - 70,695 Other 4,856 - - - - 4,856 Total non-covered loans 1,724,543 35,452 46,237 202 - 1,806,434 Covered loans Commercial loans Construction, development, and other land - 39 1 - - 40 Single family non-owner occupied 271 - 21 - - 292 Non-farm, non-residential - - 10 - - 10 Consumer real estate loans Home equity lines 12,242 13,840 768 - - 26,850 Single family owner occupied 3,136 425 534 - - 4,095 Total covered loans 15,649 14,304 1,334 - - 31,287 Total loans $ 1,740,192 $ 49,756 $ 47,571 $ 202 $ - $ 1,837,721 December 31, 2016 Special (Amounts in thousands) Pass Mention Substandard Doubtful Loss Total Non-covered loans Commercial loans Construction, development, and other land $ 55,188 $ 980 $ 780 $ - $ - $ 56,948 Commercial and industrial 87,581 3,483 1,137 - 3 92,204 Multi-family residential 126,468 6,992 768 - - 134,228 Single family non-owner occupied 131,934 5,466 5,565 - - 142,965 Non-farm, non-residential 579,134 10,236 9,102 202 - 598,674 Agricultural 5,839 164 - - - 6,003 Farmland 28,887 1,223 1,619 - - 31,729 Consumer real estate loans Home equity lines 104,033 871 1,457 - - 106,361 Single family owner occupied 475,402 4,636 20,381 472 - 500,891 Owner occupied construction 43,833 - 702 - - 44,535 Consumer and other loans Consumer loans 77,218 11 216 - - 77,445 Other 3,971 - - - - 3,971 Total non-covered loans 1,719,488 34,062 41,727 674 3 1,795,954 Covered loans Commercial loans Construction, development, and other land 2,768 803 999 - - 4,570 Commercial and industrial 882 - 13 - - 895 Multi-family residential - - 8 - - 8 Single family non-owner occupied 796 63 103 - - 962 Non-farm, non-residential 6,423 537 552 - - 7,512 Agricultural 25 - - - - 25 Farmland 132 - 265 - - 397 Consumer real estate loans Home equity lines 14,283 20,763 771 - - 35,817 Single family owner occupied 4,601 928 1,200 - - 6,729 Consumer and other loans Consumer loans 79 - - - - 79 Total covered loans 29,989 23,094 3,911 - - 56,994 Total loans $ 1,749,477 $ 57,156 $ 45,638 $ 674 $ 3 $ 1,852,948 The Company identifies loans for potential impairment through a variety of means, including, but not not The following table presents the recorded investment, unpaid principal balance, and related allowance for loan losses for impaired loans, excluding PCI loans, as of the dates indicated: September 30, 2017 December 31, 2016 Unpaid Unpaid Recorded Principal Related Recorded Principal Related (Amounts in thousands) Investment Balance Allowance Investment Balance Allowance Impaired loans with no related allowance Commercial loans Construction, development, and other land $ 662 $ 999 $ - $ 33 $ 35 $ - Commercial and industrial 146 1,093 - 346 383 - Multi-family residential 381 836 - 294 369 - Single family non-owner occupied 2,485 3,891 - 3,084 3,334 - Non-farm, non-residential 3,905 6,239 - 3,829 4,534 - Agricultural 118 122 - - - - Farmland 990 1,037 - 1,161 1,188 - Consumer real estate loans Home equity lines 1,624 1,766 - 913 968 - Single family owner occupied 16,768 18,932 - 11,779 12,630 - Owner occupied construction 233 233 - 573 589 - Consumer and other loans Consumer loans 61 63 - 62 103 - Total impaired loans with no allowance 27,373 35,211 - 22,074 24,133 - Impaired loans with a related allowance Commercial loans Construction, development, and other land - - - - - - Commercial and industrial 2,400 2,400 262 - - - Single family non-owner occupied 771 772 69 351 351 31 Non-farm, non-residential 865 874 325 - - - Farmland 410 418 50 430 430 18 Consumer real estate loans Home equity lines - - - - - - Single family owner occupied 3,771 3,779 754 4,118 4,174 770 Total impaired loans with an allowance 8,217 8,243 1,460 4,899 4,955 819 Total impaired loans (1) $ 35,590 $ 43,454 $ 1,460 $ 26,973 $ 29,088 $ 819 ( 1 Includes loans totaling $20.07 September 30, 2017, $16.89 December 31, 2016, not The following table presents the average recorded investment and interest income recognized on impaired loans, excluding PCI loans, for the periods indicated: Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 (Amounts in thousands) Interest Income Recognized Average Recorded Investment Interest Income Recognized Average Recorded Investment Interest Income Recognized Average Recorded Investment Interest Income Recognized Average Recorded Investment Impaired loans with no related allowance: Commercial loans Construction, development, and other land $ 32 $ 907 $ 22 $ 600 $ 32 $ 309 $ 22 $ 447 Commercial and industrial 5 754 6 1,029 8 468 10 738 Multi-family residential - 509 15 562 3 474 15 309 Single family non-owner occupied 11 3,304 91 3,498 88 3,313 107 3,035 Non-farm, non-residential 68 5,244 65 8,930 93 3,766 307 10,186 Agricultural 4 127 - - 4 127 - - Farmland 17 1,003 5 204 17 1,004 9 186 Consumer real estate loans Home equity lines 15 1,683 6 1,157 35 1,259 21 1,318 Single family owner occupied 137 17,478 91 13,175 317 15,209 254 12,436 Owner occupied construction 1 235 2 585 6 234 7 470 Consumer and other loans Consumer loans 1 62 2 63 3 52 2 45 Total impaired loans with no related allowance 291 31,306 305 29,803 606 26,215 754 29,170 Impaired loans with a related allowance: Commercial loans Construction, development, and other land - - - - - 143 - - Commercial and industrial 50 2,516 - - 103 1,727 - - Single family non-owner occupied 8 778 5 682 21 488 18 572 Non-farm, non-residential - 872 45 4,658 15 964 215 5,108 Farmland - 413 - - - 275 - - Consumer real estate loans Home equity lines - - - - - 139 - - Single family owner occupied 24 3,814 24 4,130 92 4,527 91 4,547 Owner occupied construction - - - - - 1 - 115 Total impaired loans with a related allowance 82 8,393 74 9,470 231 8,264 324 10,342 Total impaired loans $ 373 $ 39,699 $ 379 $ 39,273 $ 837 $ 34,479 $ 1,078 $ 39,512 The following tables provide information on impaired PCI loan pools as of and for the dates indicated: September 30, 2017 December 31, 2016 (Amounts in thousands, except impaired loan pools) Unpaid principal balance $ - $ 1,086 Recorded investment - 1,085 Allowance for loan losses related to PCI loan pools - 12 Impaired PCI loan pools - 1 Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 (Amounts in thousands) Interest income recognized $ - $ 12 $ 20 $ 130 Average recorded investment - 1,139 705 2,195 The Company generally places a loan on nonaccrual status when it is 90 not September 30, 2017 December 31, 2016 (Amounts in thousands) Non-covered Covered Total Non-covered Covered Total Commercial loans Construction, development, and other land $ 126 $ - $ 126 $ 72 $ 32 $ 104 Commercial and industrial 118 - 118 332 13 345 Multi-family residential 330 - 330 294 - 294 Single family non-owner occupied 1,626 20 1,646 1,242 24 1,266 Non-farm, non-residential 3,352 - 3,352 3,295 30 3,325 Agricultural 118 - 118 - - - Farmland 870 - 870 1,591 - 1,591 Consumer real estate loans Home equity lines 828 350 1,178 705 400 1,105 Single family owner occupied 11,517 50 11,567 7,924 109 8,033 Owner occupied construction - - - 336 - 336 Consumer and other loans Consumer loans 57 - 57 63 - 63 Total nonaccrual loans $ 18,942 $ 420 $ 19,362 $ 15,854 $ 608 $ 16,462 The following tables present the aging of past due loans, by loan class, as of the dates indicated. Nonaccrual loans 30 delinquency category. Loans acquired with credit deterioration, with a discount, continue to accrue interest based on expected cash flows; therefore, PCI loans are not no 90 September 30, 2017, December 31, 2016. September 30, 2017 30 - 59 Days 60 - 89 Days 90+ Days Total Current Total (Amounts in thousands) Past Due Past Due Past Due Past Due Loans Loans Non-covered loans Commercial loans Construction, development, and other land $ 25 $ - $ - $ 25 $ 72,927 $ 72,952 Commercial and industrial 226 36 47 309 89,875 90,184 Multi-family residential 341 185 - 526 125,471 125,997 Single family non-owner occupied 405 186 861 1,452 141,761 143,213 Non-farm, non-residential 523 17 2,623 3,163 610,217 613,380 Agricultural 6 - - 6 6,090 6,096 Farmland 849 410 343 1,602 26,295 27,897 Consumer real estate loans Home equity lines 242 105 298 645 102,243 102,888 Single family owner occupied 3,133 1,414 6,199 10,746 490,496 501,242 Owner occupied construction 330 - - 330 46,704 47,034 Consumer and other loans Consumer loans 360 62 38 460 70,235 70,695 Other - - - - 4,856 4,856 Total non-covered loans 6,440 2,415 10,409 19,264 1,787,170 1,806,434 Covered loans Commercial loans Construction, development, and other land - - - - 40 40 Single family non-owner occupied 72 - - 72 220 292 Non-farm, non-residential - - - - 10 10 Consumer real estate loans Home equity lines 291 - 118 409 26,441 26,850 Single family owner occupied - - 28 28 4,067 4,095 Total covered loans 363 - 146 509 30,778 31,287 Total loans $ 6,803 $ 2,415 $ 10,555 $ 19,773 $ 1,817,948 $ 1,837,721 December 31, 2016 30 - 59 Days 60 - 89 Days 90+ Days Total Current Total (Amounts in thousands) Past Due Past Due Past Due Past Due Loans Loans Non-covered loans Commercial loans Construction, development, and other land $ 33 $ 5 $ 17 $ 55 $ 56,893 $ 56,948 Commercial and industrial 174 30 149 353 91,851 92,204 Multi-family residential 163 - 281 444 133,784 134,228 Single family non-owner occupied 1,302 159 835 2,296 140,669 142,965 Non-farm, non-residential 1,235 332 2,169 3,736 594,938 598,674 Agricultural - 5 - 5 5,998 6,003 Farmland 224 343 565 1,132 30,597 31,729 Consumer real estate loans Home equity lines 78 136 658 872 105,489 106,361 Single family owner occupied 4,777 2,408 3,311 10,496 490,395 500,891 Owner occupied construction 342 336 - 678 43,857 44,535 Consumer and other loans Consumer loans 371 90 15 476 76,969 77,445 Other - - - - 3,971 3,971 Total non-covered loans 8,699 3,844 8,000 20,543 1,775,411 1,795,954 Covered loans Commercial loans Construction, development, and other land 434 - 32 466 4,104 4,570 Commercial and industrial - - - - 895 895 Multi-family residential - - - - 8 8 Single family non-owner occupied 24 - - 24 938 962 Non-farm, non-residential 32 - - 32 7,480 7,512 Agricultural - - - - 25 25 Farmland - - - - 397 397 Consumer real estate loans Home equity lines 108 146 62 316 35,501 35,817 Single family owner occupied 58 - 39 97 6,632 6,729 Owner occupied construction - - - - - - Consumer and other loans Consumer loans - - - - 79 79 Total covered loans 656 146 133 935 56,059 56,994 Total loans $ 9,355 $ 3,990 $ 8,133 $ 21,478 $ 1,831,470 $ 1,852,948 The Company may $250 $250 troubled debt restructurings (“TDRs”) are classified as nonperforming at the time of restructuring and are returned to performing status after six not No September 30, 2017, December 31, 2016. The following table presents loans modified as TDRs, by loan class and accrual status, as of the dates indicated: September 30, 2017 December 31, 2016 (Amounts in thousands) Nonaccrual (1) Accruing Total Nonaccrual (1) Accruing Total Commercial loans Single family non-owner occupied $ 33 $ 875 $ 908 $ 38 $ 892 $ 930 Non-farm, non-residential - 295 295 - 4,160 4,160 Consumer real estate loans Home equity lines - 148 148 - 158 158 Single family owner occupied 1,484 6,690 8,174 905 7,503 8,408 Owner occupied construction - 234 234 341 239 580 Total TDRs $ 1,517 $ 8,242 $ 9,759 $ 1,284 $ 12,952 $ 14,236 Allowance for loan losses related to TDRs $ 707 $ 670 ( 1 Nonaccrual TDRs are included in total nonaccrual loans disclosed in the nonaccrual table above. The following table presents interest income recognized on TDRs for the periods indicated: Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 (Amounts in thousands) Interest income recognized $ 74 $ 143 $ 159 $ 296 The following tables present loans modified as TDRs, by type of concession made and loan class, that were restructured during the periods indicated. The post-modification recorded investment represents the loan balance immediately following modification. Three Months Ended September 30, 2017 2016 (Amounts in thousands) Total Contracts Pre-modification Recorded Investment Post-modification Recorded Investment Total Contracts Pre-modification Recorded Investment Post-modification Recorded Investment Below market interest rate and extended payment term Single family owner occupied 1 $ 42 $ 42 - $ - $ - Total 1 $ 42 $ 42 - $ - $ - Nine Months Ended September 30, 2017 2016 (Amounts in thousands) Total Contracts Pre-modification Recorded Investment Post-modification Recorded Investment Total Contracts Pre-modification Recorded Investment Post-modification Recorded Investment Below market interest rate and extended payment term Single family owner occupied 3 $ 141 $ 141 1 $ 115 $ 115 Total 3 $ 141 $ 141 1 $ 115 $ 115 There were no 12 September 30, 2017 2016. The following table provides information about other real estate owned (“OREO”), which consists of properties acquired through foreclosure, as of the dates indicated: September 30, 2017 December 31, 2016 (Amounts in thousands) Non-covered OREO $ 3,543 $ 5,109 Covered OREO 54 276 Total OREO $ 3,597 $ 5,385 Non-covered OREO secured by residential real estate $ 971 $ 1,746 Residential real estate loans in the foreclosure process (1) 10,025 2,539 ( 1 The recorded investment in consumer mortgage loans collateralized by residential real estate that are in the process of foreclosure according to local requirements of the applicable jurisdiction |