Loans and Credit Quality (Tables)

9 Months Ended

Sep. 30, 2018

The following table presents total portfolio loans by portfolio segment and class of financing receivable, based on the Company's asset quality rating ("AQR") criteria:



(In Thousands)	Commercial		Real estate construction one-to-four family		Real estate construction other		Real estate term owner occupied		Real estate term non-owner occupied		Real estate term other		Consumer secured by 1st deeds of trust		Consumer other		Total
September 30, 2018
AQR Pass		$301,757		$36,119		$61,857		$120,902		$322,051		$40,889		$19,525		$22,495		$925,595
AQR Special Mention	6,279		—		—		4,484		18,300		—		199		16		29,278
AQR Substandard	25,096		—		—		4,780		469		577		478		62		31,462
AQR Doubtful	—		—		—		—		—		27		—		—		27
Subtotal		$333,132		$36,119		$61,857		$130,166		$340,820		$41,493		$20,202		$22,573		$986,362
Less: Unearned origination fees, net of origination costs																	(4,355		)
Total loans																		$982,007
December 31, 2017
AQR Pass		$277,371		$31,201		$80,093		$127,059		$307,780		$39,777		$21,846		$19,895		$905,022
AQR Special Mention	4,921		—		—		2,095		11,051		634		3		22		18,726
AQR Substandard	31,222		—		—		2,888		482		—		767		2		35,361
Subtotal		$313,514		$31,201		$80,093		$132,042		$319,313		$40,411		$22,616		$19,919		$959,109
Less: Unearned origination fees, net of origination costs																	(4,156		)
Total loans																		$954,953

Nonaccrual Loans by Segment

Nonaccrual loans at the periods indicated are presented below by segment:



(In Thousands)	30-59 Days Past Due		60-89 Days Past Due		Greater Than 90 Days Past Due			Current			Total
September 30, 2018
Commercial		$121		$600		$2,742			$11,271			$14,734
Real estate term owner occupied	—		—		1,694			—			1,694
Real estate term other	—		—		26			—			26
Consumer secured by 1st deeds of trust	—		—		226			—			226
Consumer other	—		—		40			8			48
Total nonperforming loans	121		600		4,728			11,279			16,728
Government guarantees on nonaccrual loans	—		—		(62		)	(217		)	(279		)
Net nonaccrual loans		$121		$600		$4,666			$11,062			$16,449
December 31, 2017
Commercial		$810		$—		$2,652			$16,455			$19,917
Real estate term owner occupied	—		—		—			1,331			1,331
Consumer secured by 1st deeds of trust	—		—		378			—			378
Total nonperforming loans	810		—		3,030			17,786			21,626
Government guarantees on nonaccrual loans	—		—		(94		)	(373		)	(467		)
Net nonaccrual loans		$810		$—		$2,936			$17,413			$21,159

Past Due Loans and Nonaccrual Loans

Past due loans and nonaccrual loans at the periods indicated are presented below by segment:



(In Thousands)	30-59 Days Past Due Still Accruing		60-89 Days Past Due Still Accruing		Greater Than 90 Days Still Accruing		Total Past Due		Nonaccrual		Current		Total
September 30, 2018
Commercial		$1,098		$—		$—		$1,098		$14,734		$317,300		$333,132
Real estate construction one-to-four family	—		—		—		—		—		36,119		36,119
Real estate construction other	—		—		—		—		—		61,857		61,857
Real estate term owner occupied	211		738		—		949		1,694		127,523		130,166
Real estate term non-owner occupied	—		—		—		—		—		340,820		340,820
Real estate term other	—		577		—		577		26		40,890		41,493
Consumer secured by 1st deed of trust	—		—		152		152		226		19,824		20,202
Consumer other	22		10		—		32		48		22,493		22,573
Subtotal		$1,331		$1,325		$152		$2,808		$16,728		$966,826		$986,362
Less: Unearned origination fees, net of origination costs													(4,355		)
Total														$982,007
December 31, 2017
Commercial		$503		$—		$240		$743		$19,917		$292,854		$313,514
Real estate construction one-to-four family	—		—		—		—		—		31,201		31,201
Real estate construction other	90		—		—		90		—		80,003		80,093
Real estate term owner occupied	966		—		—		966		1,331		129,745		132,042
Real estate term non-owner occupied	—		—		—		—		—		319,313		319,313
Real estate term other	—		—		—		—		—		40,411		40,411
Consumer secured by 1st deed of trust	363		—		—		363		378		21,875		22,616
Consumer other	161		53		12		226		—		19,693		19,919
Subtotal		$2,083		$53		$252		$2,388		$21,626		$935,095		$959,109
Less: Unearned origination fees, net of origination costs													(4,156		)
Total														$954,953

Impaired Loans

The following tables summarize our average recorded investment and interest income recognized on impaired loans for the three and nine-month periods ended September 30, 2018 and 2017:



Three Months Ended September 30,	2018						2017
(In Thousands)	Average Recorded Investment		Interest Income Recognized			Average Recorded Investment			Interest Income Recognized
With no related allowance recorded
Commercial - AQR special mention		$2,113			$31			$97			$—
Commercial - AQR substandard	26,518			43			18,125			72
Real estate term owner occupied- AQR special mention	617			—			—			—
Real estate term owner occupied- AQR substandard	2,908			52			7,345			114
Real estate term non-owner occupied- AQR pass	206			7			346			6
Real estate term non-owner occupied- AQR substandard	287			8			580			9
Real estate term other - AQR pass	310			11			585			10
Real estate term other - AQR substandard	353			—			641			11
Consumer secured by 1st deeds of trust - AQR pass	132			2			—			—
Consumer secured by 1st deeds of trust - AQR special mention	—			—			139			3
Consumer secured by 1st deeds of trust - AQR substandard	154			2			771			5
Subtotal		$33,598			$156			$28,629			$230



With an allowance recorded
Commercial - AQR special mention		$—		$—		$2,083		$3
Commercial - AQR substandard	1,081		10		10,056		4
Consumer secured by 1st deeds of trust - AQR substandard	136		—		—		—
Subtotal		$1,217		$10		$12,139		$7



Total
Commercial - AQR special mention		$2,113		$31		$2,180		$3
Commercial - AQR substandard	27,599		53		28,181		76
Real estate term owner-occupied - AQR special mention	617		—		—		—
Real estate term owner-occupied - AQR substandard	2,908		52		7,345		114
Real estate term non-owner occupied - AQR pass	206		7		346		6
Real estate term non-owner occupied - AQR substandard	287		8		580		9
Real estate term other - AQR pass	310		11		585		10
Real estate term other - AQR substandard	353		—		641		11
Consumer secured by 1st deeds of trust - AQR pass	132		2		—		—
Consumer secured by 1st deeds of trust - AQR special mention	—		—		139		3
Consumer secured by 1st deeds of trust - AQR substandard	290		2		771		5
Total Impaired Loans		$34,815		$166		$40,768		$237



Nine Months Ended September 30,	2018						2017
(In Thousands)	Average Recorded Investment		Interest Income Recognized			Average Recorded Investment			Interest Income Recognized
With no related allowance recorded
Commercial - AQR special mention		$2,192			$96			$49			$1
Commercial - AQR substandard	25,271			300			20,363			405
Real estate term owner occupied- AQR pass	—			—			82			5
Real estate term owner occupied- AQR special mention	208			—			—			—
Real estate term owner occupied- AQR substandard	4,019			129			6,257			260
Real estate term non-owner occupied- AQR pass	294			18			367			38
Real estate term non-owner occupied- AQR special mention	29			2			—			—
Real estate term non-owner occupied- AQR substandard	413			22			654			38
Real estate term other - AQR pass	462			28			604			32
Real estate term other - AQR substandard	119			—			652			34
Consumer secured by 1st deeds of trust - AQR pass	136			10			—			—
Consumer secured by 1st deeds of trust - AQR special mention	—			—			141			10
Consumer secured by 1st deeds of trust - AQR substandard	168			8			506			13
Consumer other - AQR substandard	—			—			17			1
Subtotal		$33,311			$613			$29,692			$837



With an allowance recorded
Commercial - AQR special mention		$—		$—		$702		$3
Commercial - AQR substandard	2,866		17		7,979		4
Commercial - AQR doubtful	18		—		—		—
Consumer secured by 1st deeds of trust - AQR substandard	126		—		—		—
Subtotal		$3,010		$17		$8,681		$7



Total
Commercial - AQR special mention		$2,192		$96		$751		$4
Commercial - AQR substandard	28,137		317		28,342		409
Commercial - AQR doubtful	18		—		—		—
Real estate term owner-occupied - AQR pass	—		—		82		5
Real estate term owner-occupied - AQR special mention	208		—		—		—
Real estate term owner-occupied - AQR substandard	4,019		129		6,257		260
Real estate term non-owner occupied - AQR pass	294		18		367		38
Real estate term non-owner occupied - AQR special mention	29		2		—		—
Real estate term non-owner occupied - AQR substandard	413		22		654		38
Real estate term other - AQR pass	462		28		604		32
Real estate term other - AQR substandard	119		—		652		34
Consumer secured by 1st deeds of trust - AQR pass	136		10		—		—
Consumer secured by 1st deeds of trust - AQR special mention	—		—		141		10
Consumer secured by 1st deeds of trust - AQR substandard	294		8		506		13
Consumer other - AQR substandard	—		—		17		1
Total Impaired Loans		$36,321		$630		$38,373		$844

The following table presents information about impaired loans by class as of the periods indicated:



(In Thousands)	Recorded Investment		Unpaid Principal Balance		Related Allowance
September 30, 2018
With no related allowance recorded
Commercial - AQR special mention		$2,105		$2,105		$—
Commercial - AQR substandard	23,608		25,148		—
Real estate term owner occupied- AQR special mention	1,008		1,008		—
Real estate term owner occupied- AQR substandard	4,781		4,781		—
Real estate term non-owner occupied- AQR pass	319		319		—
Real estate term non-owner occupied- AQR substandard	469		469		—
Real estate term other - AQR pass	504		504		—
Real estate term other - AQR substandard	577		577		—
Consumer secured by 1st deeds of trust - AQR pass	131		131		—
Consumer secured by 1st deeds of trust - AQR substandard	252		252		—
Subtotal		$33,754		$35,294		$—



With an allowance recorded
Commercial - AQR substandard		$1,454		$1,958		$323
Consumer secured by 1st deeds of trust - AQR substandard	226		226		49
Subtotal		$1,680		$2,184		$372



Total
Commercial - AQR special mention		$2,105		$2,105		$—
Commercial - AQR substandard	25,062		27,106		323
Real estate term owner-occupied - AQR special mention	1,008		1,008		—
Real estate term owner-occupied - AQR substandard	4,781		4,781		—
Real estate term non-owner occupied - AQR pass	319		319		—
Real estate term non-owner occupied - AQR substandard	469		469		—
Real estate term other - AQR pass	504		504		—
Real estate term other - AQR substandard	577		577		—
Consumer secured by 1st deeds of trust - AQR pass	131		131		—
Consumer secured by 1st deeds of trust - AQR substandard	478		478		49
Total		$35,434		$37,478		$372



(In Thousands)	Recorded Investment		Unpaid Principal Balance		Related Allowance
December 31, 2017
With no related allowance recorded
Commercial - AQR special mention		$2,153		$2,153		$—
Commercial - AQR substandard	16,671		17,742		—
Real estate term owner occupied - AQR substandard	2,862		2,862		—
Real estate term non-owner occupied - AQR pass	303		303		—
Real estate term non-owner occupied - AQR special mention	89		89		—
Real estate term non-owner occupied - AQR substandard	482		482		—
Real estate term other - AQR pass	559		559		—
Consumer secured by 1st deeds of trust - AQR pass	136		136		—
Consumer secured by 1st deeds of trust - AQR substandard	724		809		—
Subtotal		$23,979		$25,135		$—



With an allowance recorded
Commercial - AQR substandard	$7,988	$7,988	$966
Subtotal	$7,988	$7,988	$966



Total
Commercial - AQR special mention		$2,153		$2,153		$—
Commercial - AQR substandard	24,659		25,730		966
Real estate term owner occupied - AQR substandard	2,862		2,862		—
Real estate term non-owner occupied - AQR pass	303		303		—
Real estate term non-owner occupied - AQR special mention	89		89		—
Real estate term non-owner occupied - AQR substandard	482		482		—
Real estate term other - AQR pass	559		559		—
Consumer secured by 1st deeds of trust - AQR pass	136		136		—
Consumer secured by 1st deeds of trust - AQR substandard	724		809		—
Total		$31,967		$33,123		$966

Restructured Loans

The following table presents the breakout between newly restructured loans that occurred during the nine months ended September 30, 2018 and restructured loans that occurred prior to 2018 that are still included in portfolio loans:



	Accrual Status		Nonaccrual Status		Total Modifications
(In Thousands)	Accrual Status		Nonaccrual Status		Total Modifications
New Troubled Debt Restructurings
Commercial - AQR substandard		$—		$1,738		$1,738
Real estate term owner occupied- AQR substandard	—		1,694		1,694
Subtotal		$—		$3,432		$3,432
Existing Troubled Debt Restructurings		$3,252		$11,178		$14,430
Total		$3,252		$14,610		$17,862

Newly Restructured Loans by Concession

The following tables present newly restructured loans that occurred during the nine months ended September 30, 2018 and 2017, by concession (terms modified):



		September 30, 2018
	Number of Contracts	Rate Modification		Term Modification		Payment Modification		Combination Modification		Total Modifications
(In Thousands)	Number of Contracts	Rate Modification		Term Modification		Payment Modification		Combination Modification		Total Modifications
Pre-Modification Outstanding Recorded Investment:
Commercial - AQR substandard	4		$—		$—		$2,704		$—		$2,704
Real estate term owner occupied- AQR substandard	2	—		—		1,694		—		1,694
Total	6		$—		$—		$4,398		$—		$4,398
Post-Modification Outstanding Recorded Investment:
Commercial - AQR substandard	4		$—		$—		$1,738		$—		$1,738
Real estate term owner occupied- AQR substandard	2	—		—		1,694		—		1,694
Total	6		$—		$—		$3,432		$—		$3,432



		September 30, 2017
	Number of Contracts	Rate Modification		Term Modification		Payment Modification		Combination Modification		Total Modifications
(In Thousands)	Number of Contracts	Rate Modification		Term Modification		Payment Modification		Combination Modification		Total Modifications
Pre-Modification Outstanding Recorded Investment:
Commercial - AQR special mention	1		$—		$2,078		$—		$—		$2,078
Commercial - AQR substandard	2	—		10,665		210		—		10,875
Total	3		$—		$12,743		$210		$—		$12,953
Post-Modification Outstanding Recorded Investment:
Commercial - AQR special mention	1		$—		$2,078		$—		$—		$2,078
Commercial - AQR substandard	2	—		9,099		205		—		9,304
Total	3		$—		$11,177		$205		$—		$11,382

Schedule of Trouble Debt Restructurings That Subsequently Defaulted

The following table presents TDRs that occurred during the twelve-month period ending September 30, 2018 that subsequently defaulted during the nine months ended September 30, 2018:



		September 30, 2018
	Number of Contracts	Recorded Investment
(In Thousands)	Number of Contracts	Recorded Investment
Troubled Debt Restructurings that Subsequently Defaulted:
Commercial - AQR substandard	2		$559
Real estate term owner occupied - AQR substandard	1	1,331
Total	3		$1,890