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, 2019 Special (Amounts in thousands) Pass Mention Substandard Doubtful Loss Total Non-covered loans Commercial loans Construction, development, and other land $ 60,124 $ 574 $ 652 $ - $ - $ 61,350 Commercial and industrial 90,609 1,524 1,494 - - 93,627 Multi-family residential 94,122 822 1,330 - - 96,274 Single family non-owner occupied 126,204 3,720 5,374 - - 135,298 Non-farm, non-residential 565,732 4,687 14,478 - - 584,897 Agricultural 8,862 71 496 - - 9,429 Farmland 14,697 510 1,521 - - 16,728 Consumer real estate loans Home equity lines 83,844 683 1,822 - - 86,349 Single family owner occupied 457,680 3,510 23,377 - - 484,567 Owner occupied construction 14,200 - 672 - - 14,872 Consumer and other loans Consumer loans 91,457 3 567 - - 92,027 Other 4,540 - - - - 4,540 Total non-covered loans 1,612,071 16,104 51,783 - - 1,679,958 Covered loans Commercial loans Construction, development, and other land - 30 - - - 30 Single family non-owner occupied 205 - 11 - - 216 Non-farm, non-residential - - 4 - - 4 Consumer real estate loans Home equity lines 7,625 3,047 359 - - 11,031 Single family owner occupied 2,157 359 361 - - 2,877 Total covered loans 9,987 3,436 735 - - 14,158 Total loans $ 1,622,058 $ 19,540 $ 52,518 $ - $ - $ 1,694,116 December 31, 2018 Special (Amounts in thousands) Pass Mention Substandard Doubtful Loss Total Non-covered loans Commercial loans Construction, development, and other land $ 61,877 $ 661 $ 970 $ - $ - $ 63,508 Commercial and industrial 102,044 2,166 653 - - 104,863 Multi-family residential 104,183 1,087 1,742 - - 107,012 Single family non-owner occupied 131,443 4,395 4,259 - - 140,097 Non-farm, non-residential 595,659 8,166 9,906 146 - 613,877 Agricultural 8,328 131 86 - - 8,545 Farmland 16,898 538 1,469 - - 18,905 Consumer real estate loans Home equity lines 91,194 649 1,623 - - 93,466 Single family owner occupied 482,794 4,355 23,814 - - 510,963 Owner occupied construction 17,872 - 299 - - 18,171 Consumer and other loans Consumer loans 71,240 4 308 - - 71,552 Other 5,310 - - - - 5,310 Total non-covered loans 1,688,842 22,152 45,129 146 - 1,756,269 Covered loans Commercial loans Construction, development, and other land - 35 - - - 35 Single family non-owner occupied 223 - 15 - - 238 Non-farm, non-residential - - 6 - - 6 Consumer real estate loans Home equity lines 9,511 5,244 529 - - 15,284 Single family owner occupied 2,507 355 390 - - 3,252 Total covered loans 12,241 5,634 940 - - 18,815 Total loans $ 1,701,083 $ 27,786 $ 46,069 $ 146 $ - $ 1,775,084 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, 2019 December 31, 2018 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 $ 560 $ 776 $ - $ 824 $ 840 $ - Commercial and industrial 63 82 - 386 416 - Multi-family residential 1,255 1,662 - 1,127 1,274 - Single family non-owner occupied 2,888 3,420 - 2,761 3,095 - Non-farm, non-residential 4,525 5,129 - 4,154 4,494 - Agricultural 217 224 - 86 96 - Farmland 1,519 1,793 - 1,464 1,547 - Consumer real estate loans Home equity lines 1,436 1,551 - 1,315 1,451 - Single family owner occupied 15,990 18,170 - 15,451 18,390 - Owner occupied construction 222 222 - 225 225 - Consumer and other loans Consumer loans 284 317 - 145 156 - Total impaired loans with no allowance 28,959 33,346 - 27,938 31,984 - Impaired loans with a related allowance Commercial loans Commercial and industrial - - - - - - Multi-family residential - - - 534 536 230 Single family non-owner occupied - - - - - - Non-farm, non-residential 1,250 1,250 301 840 842 235 Farmland - - - - - - Consumer real estate loans Home equity lines - - - 65 68 65 Single family owner occupied 1,251 1,251 356 3,631 3,683 922 Total impaired loans with an allowance 2,501 2,501 657 5,070 5,129 1,452 Total impaired loans (1) $ 31,460 $ 35,847 $ 657 $ 33,008 $ 37,113 $ 1,452 ( 1 Total impaired loans include loans totaling $25.18 September 30, 2019, $25.27 December 31, 2018, 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, 2019 2018 2019 2018 (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 $ 5 $ 570 $ - $ 910 $ 17 $ 720 $ 14 $ 950 Commercial and industrial 2 66 3 311 7 277 6 378 Multi-family residential 5 1,269 5 1,402 21 1,385 15 832 Single family non-owner occupied 41 2,958 8 2,529 97 3,063 56 2,599 Non-farm, non-residential 20 4,590 - 3,926 84 4,832 39 5,028 Agricultural 9 223 - 103 11 108 - 187 Farmland 19 1,536 23 1,425 45 1,474 38 1,066 Consumer real estate loans Home equity lines 17 1,463 3 1,514 31 1,452 20 1,719 Single family owner occupied 176 16,593 15 15,832 454 16,123 208 15,222 Owner occupied construction 3 224 - 229 7 223 6 249 Consumer and other loans Consumer loans 6 319 - 210 10 187 6 164 Total impaired loans with no related allowance 303 29,811 57 28,391 784 29,844 408 28,394 Impaired loans with a related allowance: Commercial loans Construction, development, and other land - - - - - - - - Commercial and industrial - - - - - - - - Multi-family residential - - - 541 - - - 271 Single family non-owner occupied - - - 849 - - 7 644 Non-farm, non-residential 20 1,254 - - 28 602 - 770 Farmland - - - 413 - - - 409 Consumer real estate loans Home equity lines - - 1 67 - - 3 69 Single family owner occupied (30 ) 1,253 35 4,999 35 2,177 126 5,838 Owner occupied construction - - - - - - - - Total impaired loans with a related allowance (10 ) 2,507 36 6,869 63 2,779 136 8,001 Total impaired loans $ 293 $ 32,318 $ 93 $ 35,260 $ 847 $ 32,623 $ 544 $ 36,395 The Company generally places a loan on nonaccrual status when it is 90 not September 30, 2019 December 31, 2018 (Amounts in thousands) Non-covered Covered Total Non-covered Covered Total Commercial loans Construction, development, and other land $ 212 $ - $ 212 $ 413 $ - $ 413 Commercial and industrial 14 - 14 428 - 428 Multi-family residential 1,144 - 1,144 1,395 - 1,395 Single family non-owner occupied 1,463 11 1,474 1,696 15 1,711 Non-farm, non-residential 3,753 - 3,753 4,020 - 4,020 Agricultural 217 - 217 86 - 86 Farmland 789 - 789 711 - 711 Consumer real estate loans Home equity lines 657 227 884 614 271 885 Single family owner occupied 8,236 5 8,241 10,141 36 10,177 Consumer and other loans Consumer loans 216 - 216 79 - 79 Total nonaccrual loans $ 16,701 $ 243 $ 16,944 $ 19,583 $ 322 $ 19,905 The following tables present the aging of past due loans, by loan class, as of the dates indicated. Nonaccrual loans 30 not 90 $107 September 30, 2019, $58 December 31, 2018. September 30, 2019 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 $ - $ - $ 212 $ 212 $ 61,138 $ 61,350 Commercial and industrial 537 792 - 1,329 92,298 93,627 Multi-family residential - - 1,144 1,144 95,130 96,274 Single family non-owner occupied 848 220 740 1,808 133,490 135,298 Non-farm, non-residential 418 978 2,725 4,121 580,776 584,897 Agricultural 37 - 47 84 9,345 9,429 Farmland 237 - 738 975 15,753 16,728 Consumer real estate loans Home equity lines 705 128 500 1,333 85,016 86,349 Single family owner occupied 3,481 1,322 3,562 8,365 476,202 484,567 Owner occupied construction - - - - 14,872 14,872 Consumer and other loans Consumer loans 1,013 147 144 1,304 90,723 92,027 Other - - - - 4,540 4,540 Total non-covered loans 7,276 3,587 9,812 20,675 1,659,283 1,679,958 Covered loans Commercial loans Construction, development, and other land - - - - 30 30 Single family non-owner occupied 11 - - 11 205 216 Non-farm, non-residential - - - - 4 4 Consumer real estate loans Home equity lines 476 2 - 478 10,553 11,031 Single family owner occupied - 27 - 27 2,850 2,877 Total covered loans 487 29 - 516 13,642 14,158 Total loans $ 7,763 $ 3,616 $ 9,812 $ 21,191 $ 1,672,925 $ 1,694,116 December 31, 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 $ 111 $ - $ 407 $ 518 $ 62,990 $ 63,508 Commercial and industrial 306 - 262 568 104,295 104,863 Multi-family residential 113 - 1,274 1,387 105,625 107,012 Single family non-owner occupied 514 1,115 992 2,621 137,476 140,097 Non-farm, non-residential 1,332 540 2,398 4,270 609,607 613,877 Agricultural 109 - - 109 8,436 8,545 Farmland 640 - 392 1,032 17,873 18,905 Consumer real estate loans Home equity lines 408 209 334 951 92,515 93,466 Single family owner occupied 5,006 3,495 4,445 12,946 498,017 510,963 Owner occupied construction - - - - 18,171 18,171 Consumer and other loans Consumer loans 507 200 59 766 70,786 71,552 Other - - - - 5,310 5,310 Total non-covered loans 9,046 5,559 10,563 25,168 1,731,101 1,756,269 Covered loans Commercial loans Construction, development, and other land - - - - 35 35 Single family non-owner occupied 15 - - 15 223 238 Non-farm, non-residential - - - - 6 6 Consumer real estate loans Home equity lines 176 38 91 305 14,979 15,284 Single family owner occupied 166 - - 166 3,086 3,252 Total covered loans 357 38 91 486 18,329 18,815 Total loans $ 9,403 $ 5,597 $ 10,654 $ 25,654 $ 1,749,430 $ 1,775,084 The Company may $250 $250 six not No September 30, 2019, December 31, 2018. The following table presents loans modified as TDRs, by loan class and accrual status, as of the dates indicated: September 30, 2019 December 31, 2018 (Amounts in thousands) Nonaccrual (1) Accruing Total Nonaccrual (1) Accruing Total Commercial loans Construction, development, and other land $ - $ - $ - $ - $ - $ - Single family non-owner occupied 556 600 1,156 640 309 949 Non-farm, non-residential - 309 309 - 314 314 Consumer real estate loans Home equity lines 3 116 119 - 127 127 Single family owner occupied 1,963 5,023 6,986 1,941 5,417 7,358 Owner occupied construction - 222 222 - 225 225 Consumer and other loans Consumer loans - 33 33 - 35 35 Total TDRs $ 2,522 $ 6,303 $ 8,825 $ 2,581 $ 6,427 $ 9,008 Allowance for loan losses related to TDRs $ 356 $ 568 ( 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 2019 2018 2019 2018 (Amounts in thousands) Interest income recognized $ 56 $ 73 $ 203 $ 207 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 September 30, 2019 2018 (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 $ 11 $ 11 Total below market interest rate - - - 1 11 11 Payment deferral Single family owner occupied 1 33 29 - - - Home equity lines - - - - - - Total principal deferral 1 33 29 0 - - Total 1 $ 33 $ 29 1 $ 11 $ 11 ( 1 Nine Months Ended September 30, 2019 2018 (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 $ 11 $ 11 Total below market interest rate - - - 1 11 11 Below market interest rate and extended payment term Single family owner occupied 2 $ 221 $ 218 1 $ 41 $ 41 Single family non-owner occupied 2 488 480 - - - Total below market interest rate and extended payment term 4 709 698 1 41 41 Payment deferral Single family owner occupied 1 33 29 - - - Home equity lines - - - - - - Total principal deferral 1 33 29 - - - Total 5 $ 742 $ 727 2 $ 52 $ 52 ( 1 There were no 12 September 30, 2019 2018. 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, 2019 December 31, 2018 (Amounts in thousands) Non-covered OREO $ 2,528 $ 3,806 Covered OREO - 32 Total OREO $ 2,528 $ 3,838 Non-covered OREO secured by residential real estate $ 1,530 $ 2,303 Residential real estate loans in the foreclosure process (1) 2,275 6,349 ( 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 |