Loans and Credit Quality (Tables)

12 Months Ended

Dec. 31, 2019

The composition of the loan portfolio as of the periods indicated is as follows:



(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
December 31, 2019
AQR Pass		$394,107		$34,132		$61,808		$129,959		$295,482		$38,771		$15,860		$24,464		$994,583
AQR Special Mention	2,279		3,337		—		3,828		17,478		2,559		179		—		29,660
AQR Substandard	16,304		1,349		—		5,104		—		1,176		159		121		24,213
Subtotal		$412,690		$38,818		$61,808		$138,891		$312,960		$42,506		$16,198		$24,585		$1,048,456
Less: Unearned origination fees, net of origination costs																	(5,085		)
Total loans																		$1,043,371
December 31, 2018
AQR Pass		$315,112		$33,729		$72,256		$117,174		$307,126		$40,792		$18,768		$23,595		$928,552
AQR Special Mention	5,116		3,382		—		3,987		18,129		670		140		2		31,426
AQR Substandard	22,192		—		—		5,253		465		577		320		47		28,854
AQR Doubtful	—		—		—		—		—		—		—		1		1
Subtotal		$342,420		$37,111		$72,256		$126,414		$325,720		$42,039		$19,228		$23,645		$988,833
Less: Unearned origination fees, net of origination costs																	(4,487		)
Total loans																		$984,346

Nonaccrual Loans By Segment

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



(In Thousands)	30-59 Days Past Due			60-89 Days Past Due		Greater Than 90 Days Past Due		Current			Total
December 31, 2019
Commercial		$270			$385		$2,862		$5,636			$9,153
Real estate construction one-to-four family	—			—		1,349		—			1,349
Real estate term owner occupied	1,641			—		623		1,225			3,489
Real estate term other	—			—		1,176		—			1,176
Consumer secured by 1st deeds of trust	—			—		—		68			68
Consumer other	26			89		—		6			121
Total nonaccrual loans	1,937			474		6,010		6,935			15,356
Government guarantees on nonaccrual loans	(268		)	—		—		(1,137		)	(1,405		)
Net nonaccrual loans		$1,669			$474		$6,010		$5,798			$13,951
December 31, 2018
Commercial		$1,329			$324		$1,287		$9,731			$12,671
Real estate term owner occupied	—			—		1,694		—			1,694
Real estate term other	—			—		577		—			577
Consumer secured by 1st deeds of trust	—			—		—		220			220
Consumer other	—			—		39		9			48
Total nonaccrual loans	1,329			324		3,597		9,960			15,210
Government guarantees on nonaccrual loans	(269		)	—		—		(247		)	(516		)
Net nonaccrual loans		$1,060			$324		$3,597		$9,713			$14,694

Past Due Loans And Nonaccrual Loans

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



(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
December 31, 2019
Commercial		$270		$—		$—		$270		$9,153		$403,267		$412,690
Real estate construction one-to-four family	—		—		—		—		1,349		37,469		38,818
Real estate construction other	—		—		—		—		—		61,808		61,808
Real estate term owner occupied	338		—		—		338		3,489		135,064		138,891
Real estate term non-owner occupied	—		—		—		—		—		312,960		312,960
Real estate term other	26		—		—		26		1,176		41,304		42,506
Consumer secured by 1st deed of trust	750		—		—		750		68		15,380		16,198
Consumer other	150		—		—		150		121		24,314		24,585
Subtotal		$1,534		$—		$—		$1,534		$15,356		$1,031,566		$1,048,456
Less: Unearned origination fees, net of origination costs													(5,085		)
Total														$1,043,371
December 31, 2018
Commercial		$872		$857		$—		$1,729		$12,671		$328,020		$342,420
Real estate construction one-to-four family	—		—		—		—		—		37,111		37,111
Real estate construction other	—		—		—		—		—		72,256		72,256
Real estate term owner occupied	1,197		—		—		1,197		1,694		123,523		126,414
Real estate term non-owner occupied	—		—		—		—		—		325,720		325,720
Real estate term other	—		—		—		—		577		41,462		42,039
Consumer secured by 1st deed of trust	224		100		—		324		220		18,684		19,228
Consumer other	190		—		—		190		48		23,407		23,645
Subtotal		$2,483		$957		$—		$3,440		$15,210		$970,183		$988,833
Less: Unearned origination fees, net of origination costs													(4,487		)
Total														$984,346

Impaired Loans

The following table presents information about impaired loans by class for the years ended December 31, 2019 and 2018:



(In Thousands)	Recorded Investment		Unpaid Principal Balance		Related Allowance
December 31, 2019
With no related allowance recorded
Commercial - AQR substandard		$15,517		$15,582		$—
Real estate construction one-to-four family - AQR substandard	1,349		1,349		—
Real estate term owner occupied - AQR substandard	5,104		5,104		—
Real estate term non-owner occupied - AQR pass	178		178		—
Real estate term other - AQR pass	417		417		—
Real estate term other - AQR substandard	1,176		1,176		—
Consumer secured by 1st deeds of trust - AQR pass	122		122		—
Consumer secured by 1st deeds of trust - AQR substandard	159		163		—
Consumer other - AQR substandard	90		94		—
Subtotal		$24,112		$24,185		$—



With an allowance recorded
Commercial - AQR substandard	$561	$561	$17
Subtotal	$561	$561	$17



Commercial - AQR substandard		$16,078		$16,143		$17
Real estate construction one-to-four family - AQR substandard	1,349		1,349		—
Real estate term owner-occupied - AQR substandard	5,104		5,104		—
Real estate term non-owner occupied - AQR pass	178		178		—
Real estate term other - AQR pass	417		417		—
Real estate term other - AQR substandard	1,176		1,176		—
Consumer secured by 1st deeds of trust - AQR pass	122		122		—
Consumer secured by 1st deeds of trust - AQR substandard	159		163		—
Consumer other - AQR substandard	90		94		—
Total		$24,673		$24,746		$17



(In Thousands)	Recorded Investment		Unpaid Principal Balance		Related Allowance
December 31, 2018
With no related allowance recorded
Commercial - AQR pass		$80		$80		$—
Commercial - AQR special mention	2,009		2,009		—
Commercial - AQR substandard	21,252		22,303		—
Real estate term owner occupied - AQR substandard	5,253		5,253		—
Real estate term non-owner occupied - AQR pass	295		295		—
Real estate term non-owner occupied - AQR substandard	465		465		—
Real estate term other - AQR pass	486		486		—
Real estate term other - AQR substandard	577		577		—
Consumer secured by 1st deeds of trust - AQR pass	129		129		—
Consumer secured by 1st deeds of trust - AQR substandard	320		320		—
Subtotal		$30,866		$31,917		$—



With an allowance recorded
Commercial - AQR substandard	$848	$1,352	$14
Subtotal	$848	$1,352	$14



Commercial - AQR pass		$80		$80		$—
Commercial - AQR special mention	2,009		2,009		—
Commercial - AQR substandard	22,100		23,655		14
Real estate term owner-occupied - AQR substandard	5,253		5,253		—
Real estate term non-owner occupied - AQR pass	295		295		—
Real estate term non-owner occupied - AQR substandard	465		465		—
Real estate term other - AQR pass	486		486		—
Real estate term other - AQR substandard	577		577		—
Consumer secured by 1st deeds of trust - AQR pass	129		129		—
Consumer secured by 1st deeds of trust - AQR substandard	320		320		—
Total		$31,714		$33,269		$14

The unpaid principal balance included in the table above represents the recorded investment at the dates indicated, plus amounts charged-off for book purposes.

The following table summarizes our average recorded investment and interest income recognized on impaired loans for years ended December 31, 2019 and 2018, respectively:



Year Ended December 31,	2019						2018
(In Thousands)	Average Recorded Investment		Interest Income Recognized			Average Recorded Investment			Interest Income Recognized
With no related allowance recorded
Commercial - AQR pass		$532			$35			$21			$2
Commercial - AQR special mention	—			—			2,146			128
Commercial - AQR substandard	16,892			405			24,548			381
Real estate construction one-to-four family - AQR substandard	1,933			—			—			—
Real estate term owner occupied - AQR special mention	—			—			155			—
Real estate term owner occupied - AQR substandard	5,747			113			3,813			201
Real estate term non-owner occupied - AQR pass	251			19			265			24
Real estate term non-owner occupied - AQR special mention	—			—			22			2
Real estate term non-owner occupied - AQR substandard	230			—			381			30
Real estate term other - AQR pass	448			31			421			36
Real estate term other - AQR substandard	1,046			—			176			—
Consumer secured by 1st deeds of trust - AQR pass	126			13			135			13
Consumer secured by 1st deeds of trust - AQR substandard	202			7			175			10
Consumer other - AQR substandard	70			—			—			—
Subtotal		$27,477			$623			$32,258			$827



With an allowance recorded
Commercial - AQR substandard		$683		$—		$2,323		$20
Commercial - AQR doubtful	—		—		14		—
Real estate term other - AQR substandard	163		—		—		—
Consumer secured by 1st deeds of trust - AQR substandard	72		—		94		—
Subtotal		$918		$—		$2,431		$20



Total
Commercial - AQR pass		$532		$35		$21		$2
Commercial - AQR special mention	—		—		2,146		128
Commercial - AQR substandard	17,575		405		26,871		401
Commercial - AQR doubtful	—		—		14		—
Real estate construction one-to-four family - AQR substandard	1,933		—		—		—
Real estate term owner-occupied - AQR special mention	—		—		155		—
Real estate term owner-occupied - AQR substandard	5,747		113		3,813		201
Real estate term non-owner occupied - AQR pass	251		19		265		24
Real estate term non-owner occupied - AQR special mention	—		—		22		2
Real estate term non-owner occupied - AQR substandard	230		—		381		30
Real estate term other - AQR pass	448		31		421		36
Real estate term other - AQR substandard	1,209		—		176		—
Consumer secured by 1st deeds of trust - AQR pass	126		13		135		13
Consumer secured by 1st deeds of trust - AQR substandard	274		7		269		10
Consumer other - AQR substandard	70		—		—		—
Total Impaired Loans		$28,395		$623		$34,689		$847

Newly Restructured Loans

The following table presents the breakout between newly restructured loans that occurred during 2019 and restructured loans that occurred prior to 2019 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		$318		$2,651		$2,969
Real estate owner occupied - AQR substandard	—		182		182
Subtotal		$318		$2,833		$3,151
Existing Troubled Debt Restructurings	1,130		5,825		6,955
Total		$1,448		$8,658		$10,106

Newly Restructured Loans By Concession

The following tables present newly restructured loans that occurred during 2019 and 2018, by concession (terms modified):



	December 31, 2019
(In Thousands)	Number of Contracts	Rate Modification		Term Modification		Payment Modification		Combination Modification		Total Modifications
Pre-Modification Outstanding Recorded Investment:
Commercial - AQR substandard	7		$—		$—		$509		$2,585		$3,094
Real estate term owner occupied - AQR substandard	1	—		—		192		—		192
Total	8		$—		$—		$701		$2,585		$3,286
Post-Modification Outstanding Recorded Investment:
Commercial - AQR substandard	7		$—		$—		$408		$2,561		$2,969
Real estate term owner occupied - AQR substandard	1	—		—		182		—		182
Total	8		$—		$—		$590		$2,561		$3,151



	December 31, 2018
(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	3	—		—		1,921		—		1,921
Total	7		$—		$—		$4,625		$—		$4,625
Post-Modification Outstanding Recorded Investment:
Commercial - AQR substandard	4		$—		$—		$1,166		$—		$1,166
Real estate term owner occupied - AQR substandard	3	—		—		1,921		—		1,921
Total	7		$—		$—		$3,087		$—		$3,087

Schedule of Trouble Debt Restructurings That Subsequently Defaulted

The following table presents TDRs that occurred during 2018 that subsequently defaulted during the twelve-months ended December 31, 2018:



		December 31, 2018
	Number of Contracts	Recorded Investment
(In Thousands)	Number of Contracts	Recorded Investment
Troubled Debt Restructurings that Subsequently Defaulted:
Commercial - AQR substandard	4	$1,166
Real estate term owner occupied - AQR substandard	2	1,694
Total	6	$2,860

Analysis Of Loan Transactions

An analysis of the loan transactions for the years indicated follows:



(In Thousands)	2019		2018		2017
Balance, beginning of the year		$—		$—		$90
Loans made	309		—		—
Repayments	—		—		90
Balance, end of year		$309		$—		$—