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

3 Months Ended

Mar. 31, 2015

Credit Quality of Loans and the Allowance for Loan Losses [Abstract]

Three months ended March 31, 2015	One-to-four family residential			All other mortgage loans			Commercial business loans		Consumer loans			Total

	(In thousands)
Beginning balance	$	1,533		$	885		$	343	$	8		$	2,769
Provision charged to expense		30			170			37		(4	)		233
Losses charged off		(654	)		-			-		-			(654	)
Recoveries		1			-			-		-			1
Ending balance	$	910		$	1,055		$	380	$	4		$	2,349


Three months ended March 31, 2014		One-to-four family residential			All other mortgage loans			Commercial business loans		Consumer loans			Total

	(In thousands)
Beginning balance	$	1,017		$	1,526		$	271	$	5		$	2,819
Provision charged to expense		(135	)		127			17		(1	)		8
Losses charged off		-			(260	)		-		-			(260	)
Recoveries		7			-			-		-			7
Ending balance	$	889		$	1,393		$	288	$	4		$	2,574

March 31, 2015	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	$	102	$	17	$	126	$	-	$	245
Collectively evaluated for impairment		808		1,038		254		4		2,104
Total allowance for loan losses	$	910	$	1,055	$	380	$	4	$	2,349

Loan Balances:
Ending balance:
Individually evaluated for impairment	$	2,997	$	1,077	$	126	$	-	$	4,200
Collectively evaluated for impairment		164,664		88,741		17,273		1,771		272,449
Total balance	$	167,661	$	89,818	$	17,399	$	1,771	$	276,649

December 31, 2014	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	$	653	$	18	$	145	$	-	$	816
Collectively evaluated for impairment		880		867		198		8		1,953
Total allowance for loan losses	$	1,533	$	885	$	343	$	8	$	2,769

Loan Balances:
Ending balance:
Individually evaluated for impairment	$	3,279	$	18	$	145	$	-	$	3,442
Collectively evaluated for impairment		166,397		86,902		16,130		2,311		271,740
Total balance	$	169,676	$	86,920	$	16,275	$	2,311	$	275,182

Schedule of Loans Receivable by Credit Risk Profile

March 31, 2015	One-to-four family residential		All other mortgage loans		Commercial business loans		Consumer loans

	(In thousands)
Rating *
Pass (Risk 1-4)	$	159,171	$	86,515	$	16,981	$	1,771
Special Mention (Risk 5)		1,207		1,412		144		-
Substandard (Risk 6)		7,283		1,891		274		-
Total	$	167,661	$	89,818	$	17,399	$	1,771


December 31, 2014		One-to-four family residential		All other mortgage loans		Commercial business loans		Consumer loans

	(In thousands)
Rating *
Pass (Risk 1-4)	$	160,190	$	84,168	$	15,812	$	2,311
Special Mention (Risk 5)		2,015		851		318		-
Substandard (Risk 6)		7,471		1,901		145		-
Total	$	169,676	$	86,920	$	16,275	$	2,311

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.

Risk 1 is unquestioned credit quality for any credit product. Loans are secured by cash and near cash collateral with immediate access to proceeds.

Risk 2 is very low risk with strong credit and repayment sources. Borrower is well capitalized in a stable industry, financial ratios exceed peers and financial trends are positive.

Risk 3 is very favorable risk with highly adequate credit strength and repayment sources. Borrower has good overall financial condition and adequate capitalization.

Risk 4 is acceptable, average risk with adequate credit strength and repayment sources. Collateral positions must be within Bank policies.

Risk 5 or “Special Mention,” also known as “watch,” has potential weakness that deserves Management's close attention. This risk includes loans where the borrower has developed financial uncertainties or the borrower is resolving the financial uncertainties. Bank credits have been secured or negotiations will be ongoing to secure further collateral.

Risk 6 or “Substandard” loans are inadequately protected by the current net worth and paying capacity of the borrower or of the collateral pledged. This risk category contains loans that exhibit a weakening of the borrower's credit strength with limited credit access and all nonperforming loans.

Risk 7 or “Doubtful” loans are significantly under protected by the current net worth and paying capacity of the borrower or of the collateral pledged. This risk category contains loans that are likely to experience a loss of some magnitude, but where the amount of the expected loss is not known with enough certainty to allow for an accurate calculation of a loss amount for charge- off. This category is considered to be temporary until a charge-off amount can be reasonably determined.

Schedule of Aging Analysis of Loans Receivable

March 31, 2015	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	$	1,055	$	281	$	972	$	2,308	$	165,353	$	167,661	$	-
All other mortgage loans		-		-		352		352		89,466		89,818		-
Commercial business loans		2		-		45		47		17,352		17,399		-
Consumer loans		1		-		-		1		1,770		1,771		-
Total	$	1,058	$	281	$	1,369	$	2,708	$	273,941	$	276,649	$	-


December 31, 2014		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	$	466	$	297	$	1,575	$	2,338	$	167,338	$	169,676	$	-
All other mortgage loans		-		198		152		350		86,570		86,920		-
Commercial business loans		-		-		59		59		16,216		16,275		-
Consumer loans		-		-		-		-		2,311		2,311		-
Total	$	466	$	495	$	1,786	$	2,747	$	272,435	$	275,182	$	-

Schedule of Non-accrual Loans

Nonaccrual loans	March 31, 2015		December 31, 2014

	(In thousands)
One-to-four family residential loans	$	2,113	$	2,740
Nonresidential real estate loans		352		350
Commercial business loans		81		96
Total	$	2,546	$	3,186

Schedule of Impaired Loans

	As of March 31, 2015						Three months ended March 31, 2015
	Recorded Balance		Unpaid Principal Balance		Specific Allowance		Average Investment in Impaired Loans		Interest Income Recognized

	(In thousands)
Loans without a specific valuation allowance
One-to-four family residential loans	$	2,112	$	2,607	$	-	$	1,610	$	12
All other mortgage loans		1,060		1,060		-		530		18
Commercial business loans		-		-		-		-		-

Loans with a specific valuation allowance
One-to-four family residential loans		885		885		102		1,528		12
All other mortgage loans		17		17		17		18		-
Commercial business loans		126		126		126		136		1

Total:
One-to-four family residential loans	$	2,997	$	3,492	$	102	$	3,138	$	24
All other mortgage loans		1,077		1,077		17		548		18
Commercial business loans		126		126		126		136		1
	$	4,200	$	4,695	$	245	$	3,822	$	43

	As of December 31, 2014						Three months ended March 31, 2014
		Recorded Balance		Unpaid Principal Balance		Specific Allowance		Average Investment in Impaired Loans		Interest Income Recognized

	(In thousands)
Loans without a specific valuation allowance
One-to-four family residential loans	$	1,108	$	1,108	$	-	$	5,583	$	64
All other mortgage loans		-		-		-		2,039		20
Commercial business loans		-		-		-		77		1

Loans with a specific valuation allowance
One-to-four family residential loans		2,171		2,171		653		782		9
All other mortgage loans		18		18		18		1,477		14
Commercial business loans		145		145		145		63		1

Total:
One-to-four family residential loans	$	3,279	$	3,279	$	653	$	6,365	$	73
All other mortgage loans		18		18		18		3,516		34
Commercial business loans		145		145		145		140		2
	$	3,442	$	3,442	$	909	$	10,021	$	109

Schedule of Troubled Debt Restructurings

Quarter-to-Date

Troubled Debt Restructurings

Number of loans

Pre-modification Recorded
Principal Balance

Post-modification Recorded

Principal Balance

(dollars in thousands)

March 31, 2014

All other mortgage loans

261

Schedule of balance of mortgage loans collateralized by residential real estate properties held as foreclosed assets

	March 31, 2015		December 31, 2014

	Recorded Investment
	(In thousands)
One-to-four family residential loans	$	120	$	179

Schedule of balance of mortgage loans collateralized by residential real estate properties that are in formal process of foreclosure

	March 31, 2015		December 31, 2014

	Recorded Investment
	(In thousands)
One-to-four family residential loans	$	159	$	24