Note 6 - Other Real Estate Owned

12 Months Ended

Dec. 31, 2019

Notes to Financial Statements

Real Estate Owned [Text Block]

N

OTE

6

– OTHER REAL ESTATE OWNED

Other real estate owned (OREO) is real estate acquired as a result of foreclosure or by deed in lieu of foreclosure. It is classified as real estate owned until such time as it is sold. When property is acquired as a result of foreclosure or by deed in lieu of foreclosure, it is recorded at its fair market value less estimated cost to sell. Any write-down of the property at the time of acquisition is charged to the allowance for loan losses.

The following table presents the major categories of OREO at the period-ends indicated:

	201 9		201 8
	(in thousands)
Commercial Real Estate:
Construction, land development, and other land		3,225		3,485
	$	3,225	$	3,485

Residential loans secured by

1

-

4

family residential properties in the process of foreclosure totaled

$172,000

and

$771,000

at

December 31, 2019

and

December 31, 2018,

respectively.

Activity relating to OREO during the years indicated is as follows:

	201 9			201 8			20 17
	(in thousands)
OREO Activity
OREO as of January 1	$	3,485		$	4,409		$	6,821
Real estate acquired		—			730			270
Valuation adjustment write-downs		(260	)		(850	)		(1,963	)
Net gain on sale		—			72			74
Proceeds from sale of properties		—			(876	)		(793	)
OREO as of December 31	$	3,225		$	3,485		$	4,409

Expenses related to OREO include:

	201 9		201 8			201 7
	(in thousands)
Net gain on sales	$	—	$	(72	)	$	(74	)
Valuation adjustment write-downs		260		850			1,963
Operating expense		108		90			84
Total	$	368	$	868		$	1,973