Credit Quality of Loans and Allowance for Loan Losses (Tables)

9 Months Ended

Sep. 30, 2013

Credit Quality Of Loans And Allowance For Loan Losses Tables

Schedule of Allowance for Loan Losses

The following presents by portfolio segment, the activity in the allowance for loan losses for the three and nine months ended September 30, 2013 and 2012:

Three months ended September 30, 2013	One-to-four family residential			All other mortgage loans		Commercial business loans		Consumer loans			Total
	(In thousands)
Beginning balance	$	1,239		$	1,557	$	185	$	6		$	2,987
Provision charged to expense		(84	)		150		16		(6	)		76
Losses charged off		(30	)		—		—		—			(30	)
Recoveries		8			—		—		1			9
Ending balance	$	1,133		$	1,707	$	201	$	1		$	3,042

Three months ended September 30, 2012	One-to-four family residential			All other mortgage loans			Commercial business loans		Consumer loans		Total
	(In thousands)
Beginning balance	$	1,082		$	2,362		$	143	$	5	$	3,592
Provision charged to expense		92			117			14		2		225
Losses charged off		(21	)		(1	)		—		—		(22	)
Recoveries		2			1			14		—		17
Ending balance	$	1,155		$	2,479		$	171	$	7	$	3,812

Nine months ended September 30, 2013	One-to-four family residential			All other mortgage loans			Commercial business loans			Consumer loans			Total
	(In thousands)
Beginning balance	$	1,122		$	1,925		$	275		$	6		$	3,328
Provision (credit) charged to expense		71			(42	)		(76	)		(8	)		(55	)
Losses charged off		(68	)		(176	)		—			(2	)		(246	)
Recoveries		8			—			2			5			15
Ending balance	$	1,133		$	1,707		$	201		$	1		$	3,042

Nine months ended September 30, 2012	One-to-four family residential			All other mortgage loans			Commercial business loans			Consumer loans			Total
	(In thousands)
Beginning balance	$	1,128		$	2,547		$	169		$	10		$	3,854
Provision charged to expense		95			534			(12	)		1			618
Losses charged off		(109	)		(603	)		—			(4	)		(716	)
Recoveries		41			1			14			—			56
Ending balance	$	1,155		$	2,479		$	171		$	7		$	3,812

The following tables present the balance in the allowance for loan losses and the recorded investment in loans based on the portfolio segment and impairment method as of September 30, 2013 and December 31, 2012:

September 30, 2013	One-to-four family residential		All other mortgage loans		Commercial business loans		Consumer loans		Total
Allowance Balances:	(In thousands)
Ending balance:
Individually evaluated for impairment	$	355	$	869	$	69	$	—	$	1,293
Collectively evaluated for impairment		778		838		132		1		1,749
Total allowance for loan losses	$	1,133	$	1,707	$	201	$	1	$	3,042
Loan Balances:
Ending balance:
Individually evaluated for impairment	$	6,913	$	4,727	$	149	$	—	$	11,789
Collectively evaluated for impairment		160,359		82,394		10,825		1,221		254,799
Total balance	$	167,272	$	87,121	$	10,974	$	1,221	$	266,588

December 31, 2012	One-to-four family residential		All other mortgage loans		Commercial business loans		Consumer loans		Total
Allowance Balances:	(In thousands)
Ending balance:
Individually evaluated for impairment	$	248	$	1,074	$	100	$	—	$	1,422
Collectively evaluated for impairment		874		851		175		6		1,906
Total allowance for loan losses	$	1,122	$	1,925	$	275	$	6	$	3,328
Loan Balances:
Ending balance:
Individually evaluated for impairment	$	6,878	$	5,837	$	185	$	—	$	12,900
Collectively evaluated for impairment		154,032		71,884		14,060		1,517		241,493
Total balance	$	160,910	$	77,721	$	14,245	$	1,517	$	254,393

Schedule of Loans Receivable Quality Indicators

The following tables present the credit risk profile of the Bank’s loan portfolio based on rating category and payment activity as of September 30, 2013 and December 31, 2012:

September 30, 2013	One-to-four family residential		All other mortgage loans		Commercial business loans		Consumer loans
	(In thousands)
Rating *
Pass (Risk 1-4)	$	158,497	$	80,341	$	10,419	$	1,219
Special Mention (Risk 5)		569		2,053		406		—
Substandard (Risk 6)		8,206		4,727		149		2
Total	$	167,272	$	87,121	$	10,974	$	1,221

December 31, 2012	One-to-four family residential		All other mortgage loans		Commercial business loans		Consumer loans
	(In thousands)
Rating *
Pass (Risk 1-4)	$	151,749	$	68,949	$	14,034	$	1,513
Special Mention (Risk 5)		708		2,934		26		—
Substandard (Risk 6)		8,453		5,838		185		4
Total	$	160,910	$	77,721	$	14,245	$	1,517

* Ratings are generally assigned to consumer and residential mortgage loans on a “pass” or “fail” basis, where “fail” results in a substandard classification. Commercial loans, both secured by real estate or other assets or unsecured, are analyzed in accordance with an analytical matrix codified in the Bank’s loan policy that produces a risk rating as described below.

Aging Analysis of Loans Receivable

The following tables present the Bank’s loan portfolio aging analysis for September 30, 2013 and December 31, 2012:

September 30, 2013	30-59 Days Past Due		60-89 Days Past Due		Greater Than 90 Days		Total Past Due		Current		Total Loans Receivable		Total Loans > 90 Days and Accruing
	(In thousands)
One-to-four family residential loans	$	102	$	229	$	869	$	1,200	$	166,072	$	167,272	$	—
All other mortgage loans		—		—		815		815		86,306		87,121		—
Commercial business loans		70		—		—		70		10,904		10,974		—
Consumer loans		—		—		—		—		1,221		1,221		—
Total	$	172	$	229	$	1,684	$	2,085	$	264,503	$	266,588	$	—

December 31, 2012	30-59 Days Past Due		60-89 Days Past Due		Greater Than 90 Days		Total Past Due		Current		Total Loans Receivable		Total Loans > 90 Days and Accruing
	(In thousands)
One-to-four family residential loans	$	1,049	$	339	$	1,190	$	2,578	$	158,332	$	160,910	$	—
All other mortgage loans		1,544		—		1,309		2,853		74,868		77,721		—
Commercial business loans		—		—		—		—		14,245		14,245		—
Consumer loans		1		2		2		5		1,512		1,517		—
Total	$	2,594	$	341	$	2,501	$	5,436	$	248,957	$	254,393	$	—

Schedule of Non-accrual Loans

Nonaccrual loans were comprised of the following at:

Nonaccrual loans	September 30, 2013		December 31, 2012
	(In thousands)
One-to-four family residential loans	$	2,238	$	2,097
Nonresidential real estate loans		1,881		3,123
All other mortgage loans		—		—
Commercial business loans		—		32
Consumer loans		2		4
Total	$	4,121	$	5,256

Schedule of Impaired Loans

Information with respect to the Company’s impaired loans at September 30, 2013 and December 31, 2012 in combination with activity for the three and nine months ended September 30, 2013 and 2012 is presented below:

	As of September 30, 2013						Three months ended September 30, 2013				Nine months ended September 30, 2013
	Recorded Balance		Unpaid Principal Balance		Specific Allowance		Average Investment in Impaired Loans		Interest Income Recognized		Average Investment in Impaired Loans		Interest Income Recognized
	(In thousands)
Loans without a specific valuation allowance
One-to-four family residential loans	$	5,602	$	5,602	$	—	$	5,785	$	84	$	5,702	$	222
All other mortgage loans		2,225		2,225		—		2,276		23		2,427		72
Commercial business loans		80		80		—		81		1		83		2
Loans with a specific valuation allowance
One-to-four family residential loans		1,311		1,311		355		1,208		7		1,266		22
All other mortgage loans		2,502		3,097		869		2,504		20		2,730		56
Commercial business loans		69		69		69		73		—		83		2
Total:
One-to-four family residential loans	$	6,913	$	6,913	$	355	$	6,993	$	91	$	6,968	$	244
All other mortgage loans		4,727		5,322		869		4,780		43		5,157		128
Commercial business loans		149		149		69		154		1		166		4
	$	11,789	$	12,384	$	1,293	$	11,927	$	135	$	12,291	$	376

	As of December 31, 2012						Three months ended September 30, 2012				Nine months ended September 30, 2012
	Recorded Balance		Unpaid Principal Balance		Specific Allowance		Average Investment in impaired Loans		Interest Income Recognized		Average Investment in Impaired Loans		Interest Income Recognized
	(In thousands)
Loans without a specific valuation allowance
One-to-four family residential loans	$	5,587	$	5,587	$	—	$	3,024	$	21	$	3,144	$	90
All other mortgage loans		2,781		2,781		—		2,324		3		2,179		58
Commercial business loans		85		85		—		—		—		—		—
Loans with a specific valuation allowance
One-to-four family residential loans		1,291		1,291		248		1,210		2		889		35
All other mortgage loans		3,056		3,652		1,074		4,723		25		4,998		64
Commercial business loans		100		100		100		43		1		66		1
Total:
One-to-four family residential loans	$	6,878	$	6,878	$	248	$	4,234	$	23	$	4,033	$	125
All other mortgage loans		5,837		6,433		1,074		7,047		28		7,177		122
Commercial business loans		185		185		100		43		1		66		1
	$	12,900	$	13,496	$	1,422	$	11,324	$	52	$	11,276	$	248

Schedule of Troubled Debt Restructurings

	Quarter-to-Date						Year-to-Date
Troubled Debt Restructurings	Number of loans		Pre- modification Unpaid Principal Balance		Post- modification Unpaid Principal Balance		Number of loans		Pre- modification Unpaid Principal Balance		Post- modification Unpaid Principal Balance
	(dollars in thousands)
September 30, 2013
One-to-four family residential loans		4	$	493	$	517		6	$	909	$	933
All other mortgage loans		—		—		—		1		576		576
September 30, 2012
One-to-four family residential loans		—	$	—	$	—		2	$	538	$	538