Loans and Allowance for Loan Losses (Tables)

6 Months Ended

Jun. 30, 2013

Loans and Allowance for Loan Losses [Abstract]

Allowance for Loan Losses and Recorded Investment in Loans Receivable

	As of and for the Six Months Ended June 30, 2013
(In thousands)	Commercial and Industrial			Commercial Real Estate		Construction and Land		Consumer			Student		Residential Real Estate			Home Equity Line of Credit			Unallocated		Total
Allowance for Loan Losses
Beginning balance at 12/31/2012	$	932		$	1,685	$	402	$	40		$	-	$	1,691		$	1,336		$	172	$	6,258
Charge-offs		(257	)		-		-		(52	)		-		(59	)		(59	)		-		(427	)
Recoveries		9			-		-		25			-		2			2			-		38
Provision (recovery)		96			865		9		8			64		(57	)		(126	)		108		967
Ending balance at 6/30/2013	$	780		$	2,550	$	411	$	21		$	64	$	1,577		$	1,153		$	280	$	6,836

Ending balances individually evaluated for impairment	$	208		$	1,028	$	300	$	-		$	-	$	207		$	62		$	-	$	1,805

Ending balances collectively evaluated for impairment	$	572		$	1,552	$	111	$	21		$	64	$	1,370		$	1,091		$	280	$	5,031

Loans Receivable
Individually evaluated for impairment	$	423		$	7,436	$	4,145	$	-		$	-	$	2,765		$	461				$	15,230
Collectively evaluated for impairment		24,201			178,287		34,525		3,473			9,887		134,316			43,001					427,690
Ending balance at 6/30/2013	$	24,624		$	185,723	$	38,670	$	3,473		$	9,887	$	137,081		$	43,462				$	442,920

	As of and for the Year Ended December 31, 2012
(In thousands)	Commercial and Industrial			Commercial Real Estate			Construction and Land		Consumer			Student		Residential Real Estate			Home Equity Line of Credit			Unallocated			Total
Allowance for Loan Losses
Beginning balance at 12/31/2011	$	795		$	2,899		$	195	$	31		$	-	$	1,584		$	698		$	526		$	6,728
Charge-offs		(526	)		(5,004	)		-		(117	)		-		(126	)		(536	)		-			(6,309	)
Recoveries		7			9			-		14			-		2			-			-			32
Provision (recovery)		656			3,781			207		112			-		231			1,174			(354	)		5,807
Ending balance at 12/31/2012	$	932		$	1,685		$	402	$	40		$	-	$	1,691		$	1,336		$	172		$	6,258

Ending balances individually evaluated for impairment	$	428		$	-		$	293	$	-		$	-	$	176		$	112		$	-		$	1,009

Ending balances collectively evaluated for impairment	$	504		$	1,685		$	109	$	40		$	-	$	1,515		$	1,224		$	172		$	5,249

Loans Receivable
Individually evaluated for impairment	$	674		$	9,612		$	4,175	$	4		$	-	$	2,372		$	228					$	17,065
Collectively evaluated for impairment		26,466			183,393			35,870		4,563			4,994		134,218			44,797						434,301
Ending balance at 12/31/2012	$	27,140		$	193,005		$	40,045	$	4,567		$	4,994	$	136,590		$	45,025					$	451,366

Credit Quality Indicators

The Company's allowance for loan losses has three basic components: the specific allowance, the general allowance, and the unallocated components. The specific allowance is used to individually allocate an allowance for larger balance, non-homogeneous loans identified as impaired. The general allowance is used for estimating the loss on pools of smaller-balance, homogeneous loans; including 1-4 family mortgage loans, installment loans and other consumer loans. Also, the general allowance is used for the remaining pool of larger balance, non-homogeneous loans which were not identified as impaired. The unallocated component of the allowance reflects the margin of imprecision inherent in the underlying assumptions used in the methodolgies for estimating specific and general losses in the portfolio.

Credit Quality Indicators

	As of June 30, 2013
(In thousands)	Commercial and Industrial		Commercial Real Estate		Construction and Land		Consumer		Student		Residential Real Estate		Home Equity Line of Credit		Total
Grade:
Pass	$	20,531	$	151,006	$	34,525	$	3,466	$	9,887	$	121,959	$	38,918	$	380,292
Special mention		1,569		21,438		-		-		-		6,143		3,047		32,197
Substandard		2,347		13,279		4,009		7		-		8,270		1,497		29,409
Doubtful		177		-		136		-		-		709		-		1,022
Loss		-		-		-		-		-		-		-		-
Total	$	24,624	$	185,723	$	38,670	$	3,473	$	9,887	$	137,081	$	43,462	$	442,920

	As of December 31, 2012
(In thousands)	Commercial and Industrial		Commercial Real Estate		Construction and Land		Consumer		Student		Residential Real Estate		Home Equity Line of Credit		Total
Grade:
Pass	$	21,704	$	152,483	$	35,871	$	4,558	$	4,994	$	120,451	$	40,189	$	380,250
Special mention		2,635		21,455		-		-		-		9,016		2,878		35,984
Substandard		2,391		19,067		4,038		9		-		6,456		1,958		33,919
Doubtful		410		-		136		-		-		667		-		1,213
Loss		-		-		-		-		-		-		-		-
Total	$	27,140	$	193,005	$	40,045	$	4,567	$	4,994	$	136,590	$	45,025	$	451,366

Age Analysis of Past Due Loans Receivable

	As of June 30, 2013
(In thousands)	30-59 Days Past Due		60-89 Days Past Due		90 Days or More Past Due		Total Past Due		Current		Total Financing Receivables		Carrying Amount > 90 Days and Accruing		Nonaccruals
Commercial and industrial	$	84	$	194	$	144	$	422	$	24,202	$	24,624	$	1	$	377
Commercial real estate		1,771		167		3,533		5,471		180,252		185,723		-		3,700
Construction and land		-		-		136		136		38,534		38,670		-		136
Consumer		67		50		-		117		3,356		3,473		-		-
Student (U.S. Government guaranteed)		804		403		3,220		4,427		5,460		9,887		3,220		-
Residential real estate		115		1,194		915		2,224		134,857		137,081		-		2,024
Home equity line of credit		126		182		815		1,123		42,339		43,462		354		461
Total	$	2,967	$	2,190	$	8,763	$	13,920	$	429,000	$	442,920	$	3,575	$	6,698

	As of December 31, 2012
(In thousands)	30-59 Days Past Due		60-89 Days Past Due		90 Days or More Past Due		Total Past Due		Current		Total Financing Receivables		Carrying Amount > 90 Days and Accruing		Nonaccruals
Commercial and industrial	$	92	$	52	$	41	$	185	$	26,955	$	27,140	$	-	$	643
Commercial real estate		-		-		7,712		7,712		185,293		193,005		-		7,712
Construction and land		508		250		136		894		39,151		40,045		-		136
Consumer		39		10		5		54		4,513		4,567		1		4
Student (U.S. Government guaranteed)		-		-		-		-		4,994		4,994		-		-
Residential real estate		2,397		397		1,474		4,268		132,322		136,590		-		1,927
Home equity line of credit		1,424		-		311		1,735		43,290		45,025		131		228
Total	$	4,460	$	709	$	9,679	$	14,848	$	436,518	$	451,366	$	132	$	10,650

The Company began purchasing rehabilitated student loans under the Federal Rehabilitated Student Loan Program during the quarter ended December 31, 2012. The repayment of both principal and accrued interest are 98% guaranteed by the U.S. Department of Education. During the quarter ended June 30, 2013, $3.2 million of the student loans were 90 days or more past due and still accruing.

Impaired Loans Receivable

	June 30, 2013
(In thousands)	Recorded Investment		Unpaid Principal Balance		Related Allowance		Average Recorded Investment		Interest Income Recognized
With no specific allowance recorded:
Commercial and industrial	$	81	$	81	$	-	$	95	$	-
Commercial real estate		4,306		4,306		-		4,309		48
Construction and land		3,683		3,683		-		3,697		81
Student (U.S. Govenment guaranteed)		-		-		-		-		-
Residential real estate		1,916		1,916		-		1,960		17
Home equity line of credit		399		399		-		399		2
Consumer		-		-		-		-		-

With an allowance recorded:
Commercial and industrial		342		342		208		350		2
Commercial real estate		3,130		3,130		1,028		3,133		53
Construction and land		462		462		300		463		10
Student (U.S. Government guaranteed)		-		-		-		-		-
Residential real estate		849		849		207		861		1
Home equity line of credit		62		62		62		62		-
Consumer		-		-		-		-		-

Total:
Commercial and industrial	$	423	$	423	$	208	$	445	$	2
Commercial real estate		7,436		7,436		1,028		7,442		101
Construction and land		4,145		4,145		300		4,160		91
Student (U.S. Government guaranteed)		-		-		-		-		-
Residential real estate		2,765		2,765		207		2,821		18
Home equity line of credit		461		461		62		461		2
Consumer		-		-		-		-		-
Total	$	15,230	$	15,230	$	1,805	$	15,329	$	214

	December 31, 2012
(In thousands)	Recorded Investment		Unpaid Principal Balance		Related Allowance		Average Recorded Investment		Interest Income Recognized
With no specific allowance recorded:
Commercial and industrial	$	109	$	109	$	-	$	136	$	2
Commercial real estate		9,612		12,523		-		11,613		650
Construction and land		3,711		3,711		-		4,134		200
Student (U.S. Government guaranteed)		-		-		-		-		-
Residential real estate		1,705		1,705		-		1,734		39
Home equity line of credit		47		47		-		47		1
Consumer		4		4		-		5		-

With an allowance recorded:
Commercial and industrial	$	565	$	565	$	428	$	575	$	5
Commercial real estate		-		-		-		-		-
Construction and land		464		464		293		594		21
Student (U.S. Government guaranteed)		-		-		-		-		-
Residential real estate		667		667		176		692		-
Home equity line of credit		181		181		112		180		3
Consumer		-		-		-		-		-

Total:
Commercial and industrial	$	674	$	674	$	428	$	711	$	7
Commercial real estate		9,612		12,523		-		11,613		650
Construction and land		4,175		4,175		293		4,728		221
Student (U.S. Government guaranteed)		-		-		-		-		-
Residential real estate		2,372		2,372		176		2,426		39
Home equity line of credit		228		228		112		227		4
Consumer		4		4		-		5		-
Total	$	17,065	$	19,976	$	1,009	$	19,710	$	921

Troubled Debt Restructurings

	Three Months Ended June 30, 2013						Three Months Ended June 30, 2012
			Pre-Modification		Post-Modification				Pre-Modification		Post-Modification
	Number		Outstanding		Outstanding		Number		Outstanding		Outstanding
	of		Recorded		Recorded		of		Recorded		Recorded
(Dollars in thousands)	Contracts		Investment		Investment		Contracts		Investment		Investment
Troubled Debt Restructurings
Commercial and industrial		-	$	-	$	-		1	$	237	$	237
Commercial real estate		-		-		-		1		1,900		1,900
Construction and Land		1		808		808		3		1,800		1,800
Consumer		-		-		-		-		-		-
Student		-		-		-		-		-		-
Residential real estate		1		300		300		-		-		-
Home equity line of credit		-		-		-		-		-		-

Troubled Debt Restructurings That Subsequently Defaulted
Commercial and industrial		-		-		-		-		-		-
Commercial real estate		-		-		-		-		-		-
Construction and Land		-		-		-		-		-		-
Consumer		-		-		-		-		-		-
Student		-		-		-		-		-		-
Residential real estate		-		-		-		-		-		-
Home equity line of credit		-		-		-		-		-		-

	Six Months Ended June 30, 2013						Six MonthsEnded June 30, 2012
			Pre-Modification		Post-Modification				Pre-Modification		Post-Modification
	Number		Outstanding		Outstanding		Number		Outstanding		Outstanding
	of		Recorded		Recorded		of		Recorded		Recorded
(Dollars in thousands)	Contracts		Investment		Investment		Contracts		Investment		Investment
Troubled Debt Restructurings
Commercial and industrial		-	$	-	$	-		1	$	237	$	237
Commercial real estate		2		2,010		2,010		1		1,900		1,900
Construction and Land		1		808		808		3		1,800		1,800
Consumer		-		-		-		-		-		-
Student		-		-		-		-		-		-
Residential real estate		1		300		300		-		-		-
Home equity line of credit		-		-		-		-		-		-

Troubled Debt Restructurings That Subsequently Defaulted
Commercial and industrial		1		237		237		-		-		-
Commercial real estate		-		-		-		-		-		-
Construction and Land		-		-		-		-		-		-
Consumer		-		-		-		-		-		-
Student		-		-		-		-		-		-
Residential real estate		-		-		-		-		-		-
Home equity line of credit		-		-		-		-		-		-

Non-performing Assets, Restructured Loans Still Accruing, and Loans Contractually Past Due

(Dollars in thousands)	June 30, 2013			December 31, 2012			June 30, 2012
Non-accrual loans	$	6,698		$	10,650		$	7,382
Other real estate owned		1,406			1,406			1,776
Non-performing corporate bond investments, at fair value		0			0			292
Total non-performing assets		8,104			12,056			9,450
Restructured loans still accruing		8,484			5,556			4,148
Student Loans (U.S. Government guaranteed) past due 90 days or more and still accruing		3,220			-			-
Loans past due 90 or more days and still accruing		355			132			201
Total non-performing and other risk assets	$	20,163		$	17,744		$	13,799

Allowance for loan losses to total loans		1.54	%		1.39	%		2.06	%
Non-accrual loans to total loans		1.51	%		2.36	%		1.61	%
Allowance for loan losses to non-accrual loans		102.06	%		58.76	%		128.00	%
Total non-accrual loans and restructured loans still accruing to total loans		3.43	%		3.59	%		2.51	%
Allowance for loan losses to non-accrual loans and restructured loans still accruing		45.03	%		38.62	%		81.95	%
Total non-performing assets to total assets		1.37	%		2.00	%		1.62	%

Restructured loans on non-accrual status are included with non-accrual loans and not with restructured loans in the above table.