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LOANS AND ALLOWANCE FOR LOAN LOSSES (Tables)
 3 Months Ended
Mar. 31, 2016
Loans and Leases Receivable Disclosure [Abstract]  
Classification of Loan Segments
The classification of loan segments as of March 31, 2016 and December 31, 2015 are summarized as follows (amounts in thousands):
 
March 31, 2016
 
December 31, 2015
Commercial and industrial
$
24,578

 
$
23,163

Commercial construction and land development
50,970

 
50,510

Commercial real estate
218,594

 
208,737

Residential construction
40,342

 
36,618

Residential mortgage
131,338

 
128,442

Consumer
6,380

 
6,638

Consumer credit cards
1,994

 
2,240

Business credit cards
1,402

 
1,168

Other
987

 
1,257

Gross loans
476,585

 
458,773

Less:
 

 
 

Net deferred loan fees
(742
)
 
(460
)
Net loans before allowance
475,843

 
458,313

Allowance for loan losses
(9,084
)
 
(9,616
)
Total net loans
$
466,759

 
$
448,697

 
 
 
 
Loans held for sale
$
730

 
$
1,145
Analysis of the Allowance for Loan Losses by Loan Segment
The following tables are an analysis of the allowance for loan losses by loan segment as of and for the three months ended March 31, 2016 and 2015 and as of and for the twelve months ended December 31, 2015 (amounts in thousands).
















 
Three Months Ended
 
March 31, 2016
 
 
 
Real Estate
 
 
 
 
 
 
Allowances for loan losses:
Commercial
and
Industrial
 
Commercial
Construction
and Land
Development
 
Commercial
Real
Estate
 
Residential
Construction
 
Residential
Mortgage
 
Consumer
 
Other
 
Totals
Balance, beginning of period
$
221

 
$
5,470

 
$
2,268

 
$
305

 
$
1,191

 
$
113

 
$
48

 
$
9,616

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Provision for loan losses
28

 
(441
)
 
545

 
(34
)
 
(99
)
 
(3
)
 
4

 
—

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Loans charged-off
(24
)
 
—

 
(565
)
 
—

 
—

 
(41
)
 
—

 
(630
)
Recoveries
27

 
11

 
2

 
21

 
10

 
26

 
1

 
98

Net recoveries (charge-offs)
3

 
11

 
(563
)
 
21

 
10

 
(15
)
 
1

 
(532
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Balance, end of period
$
252

 
$
5,040

 
$
2,250

 
$
292

 
$
1,102

 
$
95

 
$
53

 
$
9,084

Ending balance: individually evaluated for impairment
$
2

 
$
649

 
$
—

 
$
—

 
$
—

 
$
—

 
$
—

 
$
651

Ending balance: collectively evaluated for impairment (1)
$
250

 
$
4,391

 
$
2,250

 
$
292

 
$
1,102

 
$
95

 
$
53

 
$
8,433

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Loans:
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

Balance, end of period
$
25,980

 
$
50,970

 
$
218,594

 
$
40,342

 
$
131,338

 
$
8,374

 
$
987

 
$
476,585

Ending balance: individually evaluated for impairment
$
78

 
$
1,421

 
$
1,775

 
$
261

 
$
1,262

 
$
—

 
$
—

 
$
4,797

Ending balance: collectively evaluated for impairment (1)
$
25,902

 
$
49,549

 
$
216,819

 
$
40,081

 
$
130,076

 
$
8,374

 
$
987

 
$
471,788


(1) At March 31, 2016, there were $302,000 in impaired loans collectively evaluated for impairment with $43,000 in reserves established.

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Three Months Ended
 
March 31, 2015
 
 
 
Real Estate
 
 
 
 
 
 
Allowances for loan losses:
Commercial
and
Industrial
 
Commercial
Construction
and Land
Development
 
Commercial
Real
Estate
 
Residential
Construction
 
Residential
Mortgage
 
Consumer
 
Other
 
Totals
Balance, beginning of period
$
119

 
$
5,105

 
$
2,382

 
$
436

 
$
1,206

 
$
89

 
$
40

 
$
9,377

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Provision for loan losses
14

 
(322
)
 
108

 
(24
)
 
214

 
15

 
(5
)
 
—

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Loans charged-off
(9
)
 
—

 
(4
)
 
—

 
(148
)
 
(54
)
 
—

 
(215
)
Recoveries
46

 
319

 
184

 
—

 
46

 
32

 
1

 
628

Net recoveries (charge-offs)
37

 
319

 
180

 
—

 
(102
)
 
(22
)
 
1

 
413

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Balance, end of period
$
170

 
$
5,102

 
$
2,670

 
$
412

 
$
1,318

 
$
82

 
$
36

 
$
9,790

Ending balance: individually evaluated for impairment
$
—

 
$
508

 
$
125

 
$
—

 
$
—

 
$
3

 
$
—

 
$
636

Ending balance: collectively evaluated for impairment (1)
$
170

 
$
4,594

 
$
2,545

 
$
412

 
$
1,318

 
$
79

 
$
36

 
$
9,154

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Loans:
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

Balance, end of period
$
27,432

 
$
53,345

 
$
208,342

 
$
28,912

 
$
132,212

 
$
8,787

 
$
281

 
$
459,311

Ending balance: individually evaluated for impairment
$
—

 
$
6,123

 
$
4,103

 
$
—

 
$
2,125

 
$
3

 
$
—

 
$
12,354

Ending balance: collectively evaluated for impairment (1)
$
27,432

 
$
47,222

 
$
204,239

 
$
28,912

 
$
130,087

 
$
8,784

 
$
281

 
$
446,957

(1) At March 31, 2015, there were $210,000 impaired loans collectively evaluated for impairment with $31,000 in reserves established.

 
Twelve Months Ended
 
December 31, 2015
 
 
 
Real Estate
 
 
 
 
 
 
Allowances for loan losses:
Commercial
and
Industrial
 
Commercial
Construction
and Land
Development
 
Commercial
Real
Estate
 
Residential
Construction
 
Residential
Mortgage
 
Consumer
 
Other
 
Totals
Balance, beginning of period
$
119

 
$
5,105

 
$
2,382

 
$
436

 
$
1,206

 
$
89

 
$
40

 
$
9,377

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Provision for loan losses
(58
)
 
(615
)
 
71

 
(90
)
 
497

 
121

 
74

 
—

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Loans charged-off
(74
)
 
(196
)
 
(578
)
 
(41
)
 
(713
)
 
(210
)
 
(69
)
 
(1,881
)
Recoveries
234

 
1,176

 
393

 
—

 
201

 
113

 
3

 
2,120

Net recoveries (charge-offs)
160

 
980

 
(185
)
 
(41
)
 
(512
)
 
(97
)
 
(66
)
 
239

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Balance, end of period
$
221

 
$
5,470

 
$
2,268

 
$
305

 
$
1,191

 
$
113

 
$
48

 
$
9,616

Ending balance: individually evaluated for impairment
$
2

 
$
989

 
$
228

 
$
—

 
$
—

 
$
—

 
$
—

 
$
1,219

Ending balance: collectively evaluated for impairment (1)
$
219

 
$
4,481

 
$
2,040

 
$
305

 
$
1,191

 
$
113

 
$
48

 
$
8,397

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Loans:
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

Balance, end of period
$
24,331

 
$
50,510

 
$
208,737

 
$
36,618

 
$
128,442

 
$
8,878

 
$
1,257

 
$
458,773

Ending balance: individually evaluated for impairment
$
84

 
$
2,564

 
$
3,957

 
$
721

 
$
1,305

 
$
—

 
$
—

 
$
8,631

Ending balance: collectively evaluated for impairment (1)
$
24,247

 
$
47,946

 
$
204,780

 
$
35,897

 
$
127,137

 
$
8,878

 
$
1,257

 
$
450,142


(1) At December 31, 2015, there were $295,000 in impaired loans collectively evaluated for impairment with $42,000 in reserves established.
Creditworthiness Analysis by Loan Class and Credit Card Portfolio Exposure
The following tables are an analysis of the creditworthiness by loan class and credit card portfolio exposure as of March 31, 2016 and December 31, 2015 (amounts in thousands).
 
March 31, 2016
 
 
 
Real Estate
 
 
 
 
 
 
 
Commercial
and
Industrial
 
Commercial
Construction
and Land
Development
 
Commercial
Real
Estate
 
Residential
Construction
 
Residential
Mortgage
 
Consumer
 
Other
 
Totals
1 - Lowest Risk
$
1,899

 
$
56

 
$
—

 
$
—

 
$
—

 
$
1,701

 
$
—

 
$
3,656

2 - Strong
1,029

 
864

 
2,778

 
245

 
15,082

 
480

 
6

 
20,484

3 - Standard
10,595

 
10,621

 
91,544

 
5,462

 
53,170

 
1,145

 
454

 
172,991

4 - Acceptable
10,646

 
35,830

 
114,161

 
34,374

 
56,464

 
2,989

 
505

 
254,969

5 - Special Mention
296

 
2,131

 
7,659

 
—

 
5,321

 
65

 
—

 
15,472

6-8 - Substandard
113

 
1,468

 
2,452

 
261

 
1,301

 
—

 
22

 
5,617

 
$
24,578

 
$
50,970

 
$
218,594

 
$
40,342

 
$
131,338

 
$
6,380

 
$
987

 
$
473,189

 
Consumer - 
Credit Card
 
Business-
Credit Card
Performing
$
1,975

 
$
1,369

Nonperforming
19

 
33

Total
$
1,994

 
$
1,402

 
 
 
 
Total Loans
 
 
$
476,585



 
December 31, 2015
 
 
 
Real Estate
 
 
 
 
 
 
 
Commercial
and
Industrial
 
Commercial
Construction
and Land
Development
 
Commercial
Real
Estate
 
Residential
Construction
 
Residential
Mortgage
 
Consumer
 
Other
 
Totals
1 - Lowest Risk
$
1,942

 
$
—

 
$
—

 
$
—

 
$
—

 
$
1,773

 
$
—

 
$
3,715

2 - Strong
971

 
749

 
2,280

 
—

 
15,187

 
386

 
7

 
19,580

3 - Standard
10,530

 
11,262

 
94,357

 
4,296

 
56,493

 
1,250

 
469

 
178,657

4 - Acceptable
9,297

 
33,832

 
103,740

 
31,431

 
50,226

 
3,170

 
757

 
232,453

5 - Special Mention
304

 
2,486

 
4,444

 
170

 
5,231

 
59

 
—

 
12,694

6-8 - Substandard
119

 
2,181

 
3,916

 
721

 
1,305

 
—

 
24

 
8,266

 
$
23,163

 
$
50,510

 
$
208,737

 
$
36,618

 
$
128,442

 
$
6,638

 
$
1,257

 
$
455,365

 
Consumer-
Credit Card
 
Business-
Credit Card
Performing
$
2,211

 
$
1,133

Non Performing
29

 
35

Total
$
2,240

 
$
1,168

 
 
 
 
Total Loans
 
 
$
458,773
Age Analysis of Past Due Loans
The following tables are an age analysis of past due loans, including those on nonaccrual by loan class, as of March 31, 2016 and December 31, 2015 (amounts in thousands).
 
March 31, 2016
 
30-89 Days
Past Due
 
Nonaccrual
 
Greater than 90 Days Past Due
 
Total Past
Due
 
Current
 
Total
Loans
Commercial & industrial
$
—

 
$
113

 
$
—

 
$
113

 
$
24,465

 
$
24,578

Commercial construction & land development
202

 
1,467

 
—

 
1,669

 
49,301

 
50,970

Commercial real estate
1

 
1,475

 
—

 
1,476

 
217,118

 
218,594

Residential construction
—

 
261

 
—

 
261

 
40,081

 
40,342

Residential mortgage
87

 
1,246

 
—

 
1,333

 
130,005

 
131,338

Consumer
39

 
—

 
—

 
39

 
6,341

 
6,380

Consumer credit cards
61

 
—

 
19

 
80

 
1,914

 
1,994

Business credit cards
79

 
—

 
33

 
112

 
1,290

 
1,402

Other loans
22

 
—

 
—

 
22

 
965

 
987

Total
$
491

 
$
4,562

 
$
52

 
$
5,105

 
$
471,480

 
$
476,585

 

 
December 31, 2015
 
30-89 Days
Past Due
 
Nonaccrual
 
Greater than 90 Days Past Due
 
Total Past
Due
 
Current
 
Total
Loans
Commercial & industrial
$
56

 
$
119

 
$
—

 
$
175

 
$
22,988

 
$
23,163

Commercial construction & land development
211

 
1,626

 
—

 
1,837

 
48,673

 
50,510

Commercial real estate
—

 
2,929

 
—

 
2,929

 
205,808

 
208,737

Residential construction
133

 
721

 
—

 
854

 
35,764

 
36,618

Residential mortgage
499

 
1,203

 
—

 
1,702

 
126,740

 
128,442

Consumer
71

 
—

 
—

 
71

 
6,567

 
6,638

Consumer credit cards
95

 
—

 
29

 
124

 
2,116

 
2,240

Business credit cards
107

 
—

 
36

 
143

 
1,025

 
1,168

Other loans
—

 
—

 
—

 
—

 
1,257

 
1,257

Total
$
1,172

 
$
6,598

 
$
65

 
$
7,835

 
$
450,938

 
$
458,773
Summary of Nonperforming Assets
Nonperforming assets at March 31, 2016 and December 31, 2015 consist of the following (amounts in thousands):
 
March 31, 2016
 
December 31, 2015
Loans past due ninety days or more and still accruing
$
52

 
$
65

Nonaccrual loans
4,562

 
6,598

Foreclosed assets
2,482

 
1,760

 Total nonperforming assets
$
7,096

 
$
8,423
Summary of Impaired Loans
The following tables illustrate the impaired loans by loan class as of March 31, 2016 and December 31, 2015 (amounts in thousands).
 
March 31, 2016
 
As of Date
 
Year to Date
 
Recorded
Investment
 
Unpaid
Principal
Balance
 
Related
Allowance
 
Average
Recorded
Investment
 
Interest
Income
Recognized
With no related allowance recorded:
 
 
 
 
 
 
 
 
 
Commercial and industrial
$
61

 
$
61

 
$
—

 
$
61

 
$
—

Commercial construction & land development
686

 
1,504

 
—

 
693

 
—

Commercial real estate
1,775

 
2,153

 
—

 
1,787

 
6

Residential construction
261

 
262

 
—

 
249

 
—

Residential mortgage
1,261

 
1,289

 
—

 
1,277

 
3

Subtotal:
4,044

 
5,269

 
—

 
4,067

 
9

 
 
 
 
 
 
 
 
 
 
With an allowance recorded:
 

 
 

 
 
 
 

 
 

Commercial and industrial
52

 
63

 
7

 
52

 
—

Commercial construction & land development
782

 
1,161

 
655

 
785

 
—

Residential mortgage
221

 
299

 
32

 
222

 
2

Subtotal:
1,055

 
1,523

 
694

 
1,059

 
2

 
 
 
 
 
 
 
 
 
 
Totals:
 

 
 

 
 

 
 

 
 

Commercial
3,356

 
4,942

 
662

 
3,378

 
6

Residential
1,743

 
1,850

 
32

 
1,748

 
5

Grand Total
$
5,099

 
$
6,792

 
$
694

 
$
5,126

 
$
11



 
December 31, 2015
 
As of Date
 
Year to Date
 
Recorded
Investment
 
Unpaid
Principal
Balance
 
Related
Allowance
 

Average
Recorded
Investment
 
Interest
Income
Recognized
With no related allowance recorded:
 
 
 
 
 
 
 
 
 
Commercial and industrial
$
67

 
$
67

 
$
—

 
$
63

 
$
3

Commercial construction & land development
737

 
1,706

 
—

 
1,031

 
19

Commercial real estate
2,258

 
2,614

 
—

 
2,020

 
50

Residential construction
721

 
722

 
—

 
408

 
8

Residential mortgage
1,305

 
1,312

 
—

 
1,191

 
51

Subtotal:
5,088

 
6,421

 
—

 
4,713

 
131

 
 
 
 
 
 
 
 
 
 
With an allowance recorded:
 

 
 

 
 

 
 

 
 

Commercial and industrial
52

 
63

 
7

 
58

 
4

Commercial construction & land development
1,948

 
3,020

 
1,006

 
2,086

 
122

Commercial real estate
1,699

 
1,699

 
228

 
1,713

 
79

Residential mortgage
139

 
217

 
20

 
183

 
8

Subtotal:
3,838

 
4,999

 
1,261

 
4,040

 
213

 
 
 
 
 
 
 
 
 
 
Totals:
 

 
 

 
 

 
 

 
 

Commercial
6,761

 
9,169

 
1,241

 
6,971

 
277

Residential
2,165

 
2,251

 
20

 
1,782

 
67

Grand Total:
$
8,926

 
$
11,420

 
$
1,261

 
$
8,753

 
$
344
Schedule of Loans Modified as TDRs
The following table provides a summary of loans modified as TDRs at March 31, 2016 and December 31, 2015 (amounts in thousands).
 
 
March 31, 2016
 
 
 Accrual
 
 Nonaccrual
 
 Total TDRs
 
 Allowance for Loan Losses Allocated
Commercial construction and land development
 
$
—

 
$
404

 
$
404

 
$
—

Commercial real estate
 
300

 
551

 
851

 
—

Residential mortgage
 
223

 
—

 
223

 
—

Total modifications
 
$
523

 
$
955

 
$
1,478

 
$
—

 
 
December 31, 2015
 
 
 Accrual
 
 Nonaccrual
 
 Total TDRs
 
 Allowance for Loan Losses Allocated
Commercial construction and land development
 
$
1,059

 
$
557

 
$
1,616

 
$
447

Commercial real estate
 
1,028

 
574

 
1,602

 
20

Residential mortgage
 
226

 
—

 
226

 
—

Total modifications
 
$
2,313

 
$
1,131

 
$
3,444

 
$
467