Allowance for Loan Losses (Tables)

3 Months Ended

Mar. 31, 2017

Allowance for Loan Losses and Recorded Investment in Financing Receivables

Changes in the allowance for loan losses were as follows:

Allowance for Loan Losses and Recorded Investment in Financing Receivables

	For the Three Months Ended March 31, 2017
	Commercial										Residential
	and		Commercial		Land &			Home			Real
	Industrial		Real Estate		Development			Equity⁽¹⁾			Estate			Other⁽²⁾			Total
Allowance for loan losses:
Beginning balance	$	2,153	$	7,550	$	604		$	2,349		$	2,648		$	237		$	15,541
Charge-offs		—		—		—			(33	)		(49	)		(16	)	$	(98	)
Recoveries		58		98		46			51			3			17			273
Net recoveries (charge-offs)		58		98		46			18			(46	)		1			175
Provision for (recovery of) loan losses		43		302		(62	)		(88	)		(35	)		(160	)		—
Ending balance	$	2,254	$	7,950	$	588		$	2,279		$	2,567		$	78		$	15,716
Ending balance: individually evaluated for impairment	$	—	$	—	$	—		$	—		$	—		$	—		$	—
Ending balance: collectively evaluated for impairment	$	2,254	$	7,950	$	588		$	2,279		$	2,567		$	78		$	15,716
Financing Receivables:
Ending balance	$	230,306	$	991,073	$	67,336		$	114,290		$	205,573		$	1,897		$	1,610,475
Ending balance: individually evaluated for impairment	$	78	$	841	$	—		$	136		$	3,022		$	—		$	4,077
Ending balance: collectively evaluated for impairment	$	230,228	$	990,232	$	67,336		$	114,154		$	202,551		$	1,897		$	1,606,398

(1)	Amount includes both home equity lines of credit and term loans.

(2)	Includes the unallocated portion of the allowance for loan losses.

	For the Three Months Ended March 31, 2016
	Commercial											Residential
	and			Commercial			Land &		Home			Real
	Industrial			Real Estate			Development		Equity⁽¹⁾			Estate			Other⁽²⁾			Total
Allowance for loan losses:
Beginning balance	$	2,921		$	8,142		$	1,058	$	2,816		$	3,029		$	42		$	18,008
Charge-offs		(11	)		(69	)		—		(165	)		(74	)		(106	)	$	(425	)
Recoveries		52			46			71		117			22			61			369
Net charge-offs		41			(23	)		71		(48	)		(52	)		(45	)		(56	)
(Recovery of) provision for loan losses		(268	)		391			236		(226	)		(263	)		130			—
Ending balance	$	2,694		$	8,510		$	1,365	$	2,542		$	2,714		$	127		$	17,952
Ending balance: individually evaluated for impairment	$	—		$	—		$	—	$	—		$	—		$	—		$	—
Ending balance: collectively evaluated for impairment	$	2,694		$	8,510		$	1,365	$	2,542		$	2,714		$	127		$	17,952
Financing Receivables:
Ending balance	$	222,828		$	885,998		$	86,520	$	136,844		$	241,891		$	3,817		$	1,577,898
Ending balance: individually evaluated for impairment	$	—		$	615		$	—	$	83		$	3,110		$	96		$	3,904
Ending balance: collectively evaluated for impairment	$	222,828		$	885,383		$	86,520	$	136,761		$	238,781		$	3,721		$	1,573,994

(1)	Amount includes both home equity lines of credit and term loans.

(2)	Includes the unallocated portion of the allowance for loan losses.

Components of Impaired Loans Held-for-Investment

The following table presents the Company’s components of impaired loans receivable, segregated by class of loans. Commercial and consumer loans that were collectively evaluated for impairment are not included in the data that follows:

Impaired Loans As of March 31, 2017
	Recorded Investment		Unpaid Principal Balance		Related Allowance		Average Recorded Investment		Accrued Interest Income Recognized		Cash Interest Income Recognized
For the Three Months Ended March 31, 2017
With no related allowance:
Commercial:
CRE owner occupied	$	327	$	506	$	—	$	330	$	—	$	—
CRE non-owner occupied		504		512		—		510		—		—
Consumer:
Residential real estate		3,022		3,386		—		3,047		—		—
Home equity lines of credit		68		72		—		70		—		—
Home equity term loans		68		83		—		68		—		—
Other		78		87		—		81		—		—
With an allowance recorded:
N/A
Total commercial	$	831	$	1,018	$	—	$	840	$	—	$	—
Total consumer	$	3,236	$	3,628	$	—	$	3,266	$	—	$	—

Impaired Loans As of March 31, 2016
	Recorded Investment		Unpaid Principal Balance		Related Allowance		Average Recorded Investment		Accrued Interest Income Recognized		Cash Interest Income Recognized
For the Three Months Ended March 31, 2016
With no related allowance:
Commercial:
CRE non-owner occupied	$	613	$	834	$	—	$	622	$	—	$	—
Consumer:
Residential real estate		3,110		3,237		—		3,134		—		—
Home equity term loans		83		92		—		85		—		—
Other		96		96		—		99		—		—
With an allowance recorded:
N/A
Total commercial	$	613	$	834	$	—	$	622	$	—	$	—
Total consumer	$	3,289	$	3,425	$	—	$	3,318	$	—	$	—

Company's Distribution of Risk Ratings within Held-for-Investment Loan Portfolio

The following table presents the Company’s distribution of risk ratings within the Company’s loan portfolio, segregated by class, as of March 31, 2017 and December 31, 2016:

Credit Quality Indicators by Internally Assigned Grade

	Commercial & industrial		Commercial real estate owner occupied		Commercial real estate non- owner occupied		Land and development		Home Equity Lines of Credit		Home Equity Term Loans		Residential Real Estate		Other		Total
As of March 31, 2017
Grade:
Pass	$	228,260	$	260,285	$	728,598	$	67,336	$	105,817	$	8,337	$	202,223	$	1,897	$	1,602,753
Special Mention		—		—		—		—		—		—		—		—		—
Substandard		2,046		1,686		504		—		68		68		3,350		—		7,722
Doubtful		—		—		—		—		—		—		—		—		—
Total	$	230,306	$	261,971	$	729,102	$	67,336	$	105,885	$	8,405	$	205,573	$	1,897	$	1,610,475
As of December 31, 2016
Grade:
Pass	$	233,907	$	229,635	$	742,146	$	67,165	$	110,377	$	9,032	$	208,460	$	2,357	$	1,603,079
Special Mention		—		—		—		—		—		—		—		—		—
Substandard		2,039		1,713		516		—		—		72		2,414		85		6,839
Doubtful		—		—		—		—		—		—		—		—		—
Total	$	235,946	$	231,348	$	742,662	$	67,165	$	110,377	$	9,104	$	210,874	$	2,442	$	1,609,918

Company's Analysis of Past Due Held-for-Investment Loans

The following table presents the Company’s analysis of past due loans, segregated by class of loans, as of March 31, 2017 and December 31, 2016:

Aging of Receivables

	30-59 Days Past Due		60-89 Days Past Due		90 Days Past Due		Total Past Due		Current		Total Financing Receivables
As of March 31, 2017
Commercial:
Commercial and industrial	$	—	$	—	$	—	$	—	$	230,306	$	230,306
CRE owner occupied		—		70		295		365		261,606		261,971
CRE non-owner occupied		678		—		323		1,001		728,101		729,102
Land and development		—		—		—		—		67,336		67,336
Consumer:
Home equity lines of credit		1,083		30		68		1,181		104,704		105,885
Home equity term loans		—		—		—		—		8,405		8,405
Residential real estate		1,272		539		951		2,762		202,811		205,573
Other		—		6		—		6		1,891		1,897
Total	$	3,033	$	645	$	1,637	$	5,315	$	1,605,160	$	1,610,475
As of December 31, 2016
Commercial:
Commercial and industrial	$	—	$	—	$	—		—	$	235,946	$	235,946
CRE owner occupied		—		—		269		269		231,079		231,348
CRE non-owner occupied		331		—		185		516		742,146		742,662
Land and development		—		—		—		—		67,165		67,165
Consumer:
Home equity lines of credit		367		—		—		367		110,010		110,377
Home equity term loans		121		—		—		121		8,983		9,104
Residential real estate		4,020		851		744		5,615		205,259		210,874
Other		59		7		85		151		2,291		2,442
Total	$	4,898	$	858	$	1,283	$	7,039	$	1,602,879	$	1,609,918