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%; June 30, 2018 Special (Amounts in thousands) Pass Mention Substandard Doubtful Loss Total Non-covered loans Commercial loans Construction, development, and other land $ 55,999 $ 835 $ 1,152 $ - $ - $ 57,986 Commercial and industrial 93,472 2,602 540 - - 96,614 Multi-family residential 105,533 3,877 657 - - 110,067 Single family non-owner occupied 132,858 5,309 3,909 - - 142,076 Non-farm, non-residential 604,886 9,807 10,160 146 - 624,999 Agricultural 8,517 202 176 - - 8,895 Farmland 19,154 321 2,444 - 136 22,055 Consumer real estate loans Home equity lines 97,813 597 1,784 - - 100,194 Single family owner occupied 486,660 4,824 25,574 - - 517,058 Owner occupied construction 22,280 - 367 - - 22,647 Consumer and other loans Consumer loans 68,592 7 281 - 5 68,885 Other 4,636 - - - - 4,636 Total non-covered loans 1,700,400 28,381 47,044 146 141 1,776,112 Covered loans Commercial loans Construction, development, and other land - 35 - - - 35 Single family non-owner occupied 235 - 17 - - 252 Non-farm, non-residential - - 8 - - 8 Consumer real estate loans Home equity lines 10,341 7,954 856 - - 19,151 Single family owner occupied 2,708 378 387 - - 3,473 Total covered loans 13,284 8,367 1,268 - - 22,919 Total loans $ 1,713,684 $ 36,748 $ 48,312 $ 146 $ 141 $ 1,799,031 December 31, 2017 Special (Amounts in thousands) Pass Mention Substandard Doubtful Loss Total Non-covered loans Commercial loans Construction, development, and other land $ 57,768 $ 1,367 $ 882 $ - $ - $ 60,017 Commercial and industrial 87,181 3,721 1,286 - - 92,188 Multi-family residential 118,509 5,663 1,030 - - 125,202 Single family non-owner occupied 130,689 7,271 3,710 - - 141,670 Non-farm, non-residential 596,616 12,493 7,351 173 - 616,633 Agricultural 6,639 294 102 - - 7,035 Farmland 22,875 210 2,564 - - 25,649 Consumer real estate loans Home equity lines 100,833 618 1,754 - - 103,205 Single family owner occupied 471,382 5,480 25,824 - - 502,686 Owner occupied construction 38,947 - 231 - - 39,178 Consumer and other loans Consumer loans 70,448 13 311 - - 70,772 Other 5,001 - - - - 5,001 Total non-covered loans 1,706,888 37,130 45,045 173 - 1,789,236 Covered loans Commercial loans Construction, development, and other land 1 38 - - - 39 Single family non-owner occupied 265 - 19 - - 284 Non-farm, non-residential - - 9 - - 9 Consumer real estate loans Home equity lines 11,338 11,685 697 - - 23,720 Single family owner occupied 2,996 411 489 - - 3,896 Total covered loans 14,600 12,134 1,214 - - 27,948 Total loans $ 1,721,488 $ 49,264 $ 46,259 $ 173 $ - $ 1,817,184 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: June 30, 2018 December 31, 2017 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 $ 820 $ 835 $ - $ 727 $ 988 $ - Commercial and industrial 230 249 - 315 1,142 - Multi-family residential 290 412 - 499 1,010 - Single family non-owner occupied 2,117 2,385 - 2,042 3,521 - Non-farm, non-residential 4,012 4,883 - 3,022 5,955 - Agricultural 176 181 - 102 107 - Farmland 1,335 1,405 - 395 414 - Consumer real estate loans Home equity lines 1,833 1,954 - 1,621 1,770 - Single family owner occupied 14,132 15,470 - 16,633 18,964 - Owner occupied construction 292 292 - 231 231 - Consumer and other loans Consumer loans 198 207 - 141 144 - Total impaired loans with no allowance 25,435 28,273 - 25,728 34,246 - Impaired loans with a related allowance Commercial loans Commercial and industrial - - - 343 343 270 Single family non-owner occupied - - - 446 446 62 Non-farm, non-residential 1,378 1,378 473 262 263 15 Farmland 410 418 105 936 974 233 Consumer real estate loans Home equity lines 67 69 67 - - - Single family owner occupied 7,043 7,053 2,434 5,586 5,606 1,978 Total impaired loans with an allowance 8,898 8,918 3,079 7,573 7,632 2,558 Total impaired loans (1) $ 34,333 $ 37,191 $ 3,079 $ 33,301 $ 41,878 $ 2,558 ( 1 Total impaired loans include loans totaling $24.92 June 30, 2018, $20.13 December 31, 2017, not first 2018, $250 $500 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 June 30, Six Months Ended June 30, 2018 2017 2018 2017 (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 $ 1 $ 823 $ - $ 10 $ 14 $ 969 $ - $ 11 Commercial and industrial 2 237 1 321 3 411 3 325 Multi-family residential - 296 3 557 10 547 3 457 Single family non-owner occupied 25 2,307 34 3,308 48 2,634 77 3,317 Non-farm, non-residential - 4,048 21 3,330 39 5,579 25 3,027 Agricultural - 175 - 128 - 229 - 127 Farmland 6 1,336 - 1,003 15 887 - 1,005 Consumer real estate loans Home equity lines 10 1,837 5 1,052 17 1,822 20 1,047 Single family owner occupied 86 14,247 93 15,943 193 14,917 180 14,074 Owner occupied construction 3 292 2 234 6 259 5 233 Consumer and other loans Consumer loans 5 207 2 43 6 141 2 46 Total impaired loans with no related allowance 138 25,805 161 25,929 351 28,395 315 23,669 Impaired loans with a related allowance: Commercial loans Construction, development, and other land - - - - - - - 214 Commercial and industrial - - 38 2,352 - - 53 1,332 Single family non-owner occupied - - 5 344 7 439 13 344 Non-farm, non-residential - 1,374 5 867 - 770 15 1,011 Farmland - 409 - 411 - 407 - 205 Consumer real estate loans Home equity lines 2 68 - - 2 70 - 209 Single family owner occupied 59 7,040 33 3,393 91 6,257 68 4,883 Owner occupied construction - - - - - - - - Total impaired loans with a related allowance 61 8,891 81 7,367 100 7,943 149 8,198 Total impaired loans $ 199 $ 34,696 $ 242 $ 33,296 $ 451 $ 36,338 $ 464 $ 31,867 There were no June 30, 2018, December 31, 2017. Three Months Ended June 30, Six Months Ended June 30, 2018 2017 2018 2017 (Amounts in thousands) Interest income recognized $ - $ 10 $ - $ 20 Average recorded investment - 1,053 - 1,064 The Company generally places a loan on nonaccrual status when it is 90 not June 30, 2018 December 31, 2017 (Amounts in thousands) Non-covered Covered Total Non-covered Covered Total Commercial loans Construction, development, and other land $ 397 $ - $ 397 $ - $ - $ - Commercial and industrial 212 - 212 211 - 211 Multi-family residential 290 - 290 498 - 498 Single family non-owner occupied 954 17 971 851 19 870 Non-farm, non-residential 4,665 - 4,665 2,448 - 2,448 Agricultural 176 - 176 102 - 102 Farmland 1,361 - 1,361 805 - 805 Consumer real estate loans Home equity lines 883 484 1,367 882 306 1,188 Single family owner occupied 12,417 - 12,417 13,108 17 13,125 Owner occupied construction 64 8 72 - - - Consumer and other loans Consumer loans 48 - 48 92 - 92 Total nonaccrual loans $ 21,467 $ 509 $ 21,976 $ 18,997 $ 342 $ 19,339 The following tables present the aging of past due loans, by loan class, as of the dates indicated. Nonaccrual loans 30 not no 90 June 30, 2018, $1 December 31, 2017. June 30, 2018 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 $ - $ 388 $ 421 $ 57,565 $ 57,986 Commercial and industrial 221 182 98 501 96,113 96,614 Multi-family residential - 371 - 371 109,696 110,067 Single family non-owner occupied 789 78 686 1,553 140,523 142,076 Non-farm, non-residential 1,920 40 3,954 5,914 619,085 624,999 Agricultural - - 74 74 8,821 8,895 Farmland 216 - 995 1,211 20,844 22,055 Consumer real estate loans Home equity lines 162 156 558 876 99,318 100,194 Single family owner occupied 3,344 1,233 7,322 11,899 505,159 517,058 Owner occupied construction - - 64 64 22,583 22,647 Consumer and other loans Consumer loans 479 141 - 620 68,265 68,885 Other - - - - 4,636 4,636 Total non-covered loans 7,164 2,201 14,139 23,504 1,752,608 1,776,112 Covered loans Commercial loans Construction, development, and other land - - - - 35 35 Single family non-owner occupied 17 - - 17 235 252 Non-farm, non-residential - - - - 8 8 Consumer real estate loans Home equity lines 191 130 297 618 18,533 19,151 Single family owner occupied - - - - 3,473 3,473 Total covered loans 208 130 297 635 22,284 22,919 Total loans $ 7,372 $ 2,331 $ 14,436 $ 24,139 $ 1,774,892 $ 1,799,031 December 31, 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 $ 20 $ 365 $ - $ 385 $ 59,632 $ 60,017 Commercial and industrial 232 40 142 414 91,774 92,188 Multi-family residential 544 - 185 729 124,473 125,202 Single family non-owner occupied 223 302 331 856 140,814 141,670 Non-farm, non-residential 2,433 383 1,536 4,352 612,281 616,633 Agricultural 123 - - 123 6,912 7,035 Farmland 113 - 692 805 24,844 25,649 Consumer real estate loans Home equity lines 226 198 485 909 102,296 103,205 Single family owner occupied 6,959 2,418 8,186 17,563 485,123 502,686 Owner occupied construction 326 79 - 405 38,773 39,178 Consumer and other loans Consumer loans 439 97 17 553 70,219 70,772 Other - - - - 5,001 5,001 Total non-covered loans 11,638 3,882 11,574 27,094 1,762,142 1,789,236 Covered loans Commercial loans Construction, development, and other land - - - - 39 39 Single family non-owner occupied - - - - 284 284 Non-farm, non-residential - - - - 9 9 Consumer real estate loans Home equity lines 402 - 173 575 23,145 23,720 Single family owner occupied 70 - - 70 3,826 3,896 Total covered loans 472 - 173 645 27,303 27,948 Total loans $ 12,110 $ 3,882 $ 11,747 $ 27,739 $ 1,789,445 $ 1,817,184 The Company may $250 $250 six not No June 30, 2018, December 31, 2017. The following table presents loans modified as TDRs, by loan class and accrual status, as of the dates indicated: June 30, 2018 December 31, 2017 (Amounts in thousands) Nonaccrual (1) Accruing Total Nonaccrual (1) Accruing Total Commercial loans Single family non-owner occupied $ 339 $ 314 $ 653 $ 364 $ 528 $ 892 Non-farm, non-residential - 289 289 - 295 295 Consumer real estate loans Home equity lines - 135 135 - 145 145 Single family owner occupied 1,675 5,978 7,653 1,565 6,496 8,061 Owner occupied construction - 228 228 - 233 233 Consumer and other loans Consumer loans - 36 36 - 37 37 Total TDRs $ 2,014 $ 6,980 $ 8,994 $ 1,929 $ 7,734 $ 9,663 Allowance for loan losses related to TDRs $ 581 $ 642 ( 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 June 30, Six Months Ended June 30, 2018 2017 2018 2017 (Amounts in thousands) Interest income recognized $ 64 $ 1 $ 134 $ 85 The following tables present loans modified as TDRs, by type of concession made and loan class, that were restructured during the periods indicated: Three Months Ended June 30, 2018 2017 (Amounts in thousands) Total Contracts Pre-modification Recorded Investment Post-modification Recorded Investment (1) Total Contracts Pre-modification Recorded Investment Post-modification Recorded Investment (1) Below market interest rate Single family owner occupied - $ - $ - 1 $ 241 $ 241 Below market interest rate and extended payment term Single family owner occupied - - - 5 949 949 Total - $ - $ - 6 $ 1,190 $ 1,190 ( 1 Six Months Ended June 30, 2018 2017 (Amounts in thousands) Total Contracts Pre-modification Recorded Investment Post-modification Recorded Investment (1) Total Contracts Pre-modification Recorded Investment Post-modification Recorded Investment (1) Below market interest rate Single family owner occupied - $ - $ - 1 $ 241 $ 241 Below market interest rate and extended payment term Single family owner occupied - - - 5 949 949 Total - $ - $ - 6 $ 1,190 $ 1,190 ( 1 There were no 12 June 30, 2018 2017. The following table provides information about other real estate owned (“OREO”), which consists of properties acquired through foreclosure, as of the dates indicated: June 30, 2018 December 31, 2017 (Amounts in thousands) Non-covered OREO $ 4,805 $ 2,409 Covered OREO 44 105 Total OREO $ 4,849 $ 2,514 Non-covered OREO secured by residential real estate $ 3,384 $ 2,209 Residential real estate loans in the foreclosure process (1) 8,338 9,921 ( 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 |