10-Q 1 pcb10q20200331.htm 10-Q Document


UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark one)
x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2020
or
¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from                   to                  
Commission file number 001-38621
PCB Bancorp
(Exact name of registrant as specified in its charter)
California
(State or other jurisdiction of
incorporation or organization)
20-8856755
(IRS Employer Identification No.)
 
 
3701 Wilshire Boulevard, Suite 900
Los Angeles, California
(Address of principal executive offices)
90010
(Zip Code)
 
 
(213) 210-2000
(Registrant’s telephone number, including area code)
 
Pacific City Financial Corporation
(Former Name, Former Address and Former Fiscal Year, If Changed Since Last Report)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Trading Symbol(s)
Name of each exchange on which registered
Common stock, no par value
PCB
Nasdaq Global Select Market
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (Section 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes x No ¨
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer
¨
 
Accelerated filer
x
Non-accelerated filer
¨
(Do not check if a smaller reporting company)
Smaller reporting company
x
 
 
 
Emerging growth company
x
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. x
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act.) Yes ¨ No x
As of April 30, 2020, the registrant had outstanding 15,376,498 shares of common stock.




PCB Bancorp and Subsidiary
Quarterly Report on Form 10-Q
March 31, 2020
Table of Contents
Part I - Financial Information
 
 
 
Item 1.
 
 
 
 
 
 
 
 
 
 
 
 
Item 2.
 
 
 
Item 3.
 
 
 
Item 4.
 
 
 
Part II - Other Information
 
 
 
Item 1.
 
 
 
Item 1A.
 
 
 
Item 2.
 
 
 
Item 3.
 
 
 
Item 4.
 
 
 
Item 5.
 
 
 
Item 6.
 
 
 



2



Forward-looking Statements
This Quarterly Report on Form 10-Q contains forward-looking statements which reflect current views of PCB Bancorp, formerly known as Pacific City Financial Corporation, (collectively, with its consolidated subsidiary, the “Company,” “we,” “us” or “our”) with respect to, among other things, future events and our financial performance. These statements are often, but not always, made through the use of words or phrases such as “may,” “might,” “should,” “could,” “predict,” “potential,” “believe,” “expect,” “continue,” “will,” “anticipate,” “seek,” “estimate,” “intend,” “plan,” “projection,” “goal,” “target,” “aim,” “would,” and “annualized” and “outlook,” or the negative version of those words or other comparable words or phrases of a future or forward-looking nature. These forward-looking statements are not historical facts, and are based on current expectations, estimates and projections about our industry, management’s beliefs and certain assumptions made by management, many of which, by their nature, are inherently uncertain and beyond our control. Accordingly, we caution you that any such forward-looking statements are not guarantees of future performance and are subject to risks, assumptions, estimates and uncertainties that are difficult to predict. Although we believe that the expectations reflected in these forward-looking statements are reasonable as of the date made, actual results may prove to be materially different from the results expressed or implied by the forward-looking statements.
A number of important factors could cause our actual results to differ materially from those indicated in these forward-looking statements, but are not limited to, the following:
business and economic conditions, particularly those affecting the financial services industry and our primary market areas and arising from current COVID-19 pandemic and governmental and societal responses thereto;
our ability to successfully manage our credit risk and the sufficiency of our allowance for loan loss;
factors that can impact the performance of our loan portfolio, including real estate values and liquidity in our primary market areas, the financial health of our commercial borrowers and the success of construction projects that we finance;
governmental monetary and fiscal policies, and changes in market interest rates;
compliance with governmental and regulatory requirements, including the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”), the Economic Growth, Regulatory Relief and Consumer Protection Act and others relating to banking, consumer protection, securities and tax matters;
compliance with the regulatory consent order related to Bank Secrecy Act and Anti-Money Laundering (“BSA/AML”) matters to which Pacific City Bank (the “Bank”), our wholly owned subsidiary, is subject;
the significant portion of our loan portfolio that is comprised of real estate loans;
our ability to attract and retain Korean-American customers;
our ability to identify and address cyber-security risks, fraud and systems errors;
our ability to effectively execute our strategic plan and manage our growth;
changes in our senior management team and our ability to attract, motivate and retain qualified personnel;
liquidity issues, including fluctuations in the fair value and liquidity of the securities we hold for sale and our ability to raise additional capital, if necessary;
costs and obligations associated with operating as a public company;
effects of competition from a wide variety of local, regional, national and other providers of financial, investment and insurance services;
the effects of severe weather, natural disasters, acts of war or terrorism, health epidemics or pandemics (or expectations about them) and other external events on our business;
the impact of any claims or legal actions to which we may be subject, including any effect on our reputation; and
changes in federal tax law or policy.
The foregoing factors should not be construed as exhaustive and should be read together with the other cautionary statements and the risks described under “Part I. Item 1A. Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2019, “Part II. Item 1A. Risk Factors” in this Quarterly Report on Form 10-Q, and our other documents filed with the United States (“U.S.”) Securities Exchange Commission (“SEC”). Because of these risks and other uncertainties, our actual future results, performance or achievement, or industry results, may be materially different from the results indicated by the forward looking statements in this report. In addition, our past results of operations are not necessarily indicative of our future results. You should not rely on any forward looking statements, which represent our beliefs, assumptions and estimates only as of the dates on which they were made, as predictions of future events. Any forward-looking statement speaks only as of the date on which it is initially made, and we do not undertake any obligation to update or review any forward-looking statement, whether as a result of new information, future developments or otherwise.

3



Part I - Financial Information
Item 1 - Consolidated Financial Statements

PCB Bancorp and Subsidiary
Consolidated Balance Sheets
(in thousands, except share data)
 
 
(Unaudited)
 
 
 
 
March 31, 2020
 
December 31, 2019
Assets
 
 
 
 
Cash and due from banks
 
$
14,880

 
$
17,808

Interest-bearing deposits in other financial institutions
 
174,039

 
128,420

Total cash and cash equivalents
 
188,919

 
146,228

Securities available-for-sale, at fair value
 
98,568

 
97,566

Securities held-to-maturity, at amortized cost (fair value of $20,449 at March 31, 2020 and $20,480, at December 31, 2019)
 
19,711

 
20,154

Total investment securities
 
118,279

 
117,720

Loans held-for-sale
 
16,191

 
1,975

Loans held-for-investment, net of deferred loan costs (fees)
 
1,451,038

 
1,450,831

Allowance for loan losses
 
(16,674
)
 
(14,380
)
Net loans held-for-investment
 
1,434,364

 
1,436,451

Premises and equipment, net
 
4,797

 
3,760

Federal Home Loan Bank and other restricted stock, at cost
 
8,345

 
8,345

Other real estate owned, net
 
376

 

Deferred tax assets, net
 
5,140

 
5,288

Servicing assets
 
6,358

 
6,798

Operating lease assets
 
8,393

 
8,991

Accrued interest receivable and other assets
 
8,775

 
10,772

Total assets
 
$
1,799,937

 
$
1,746,328

Liabilities and Shareholders’ Equity
 
 
 
 
Deposits:
 
 
 
 
Noninterest-bearing demand
 
$
394,084

 
$
360,039

Savings, NOW and money market accounts
 
374,033

 
362,179

Time deposits of $250,000 or less
 
442,355

 
467,363

Time deposits of more than $250,000
 
266,970

 
289,726

Total deposits
 
1,477,442

 
1,479,307

Federal Home Loan Bank advances
 
80,000

 
20,000

Operating lease liabilities
 
9,349

 
9,990

Accrued interest payable and other liabilities
 
9,021

 
10,197

Total liabilities
 
1,575,812

 
1,519,494

Commitments and contingent liabilities
 

 

Preferred stock, 10,000,000 shares authorized, no par value, no issued and outstanding shares
 

 

Common stock, 60,000,000 shares authorized, no par value; 15,370,086 and 15,707,016 shares issued and outstanding, respectively, and included 38,400 and 37,400 shares of unvested restricted stock, respectively, at March 31, 2020 and December 31, 2019
 
163,532

 
169,221

Retained earnings
 
59,702

 
57,670

Accumulated other comprehensive income (loss), net
 
891

 
(57
)
Total shareholders’ equity
 
224,125

 
226,834

Total liabilities and shareholders’ equity
 
$
1,799,937

 
$
1,746,328

 
 
 
 
 
See Accompanying Notes to Consolidated Financial Statements (Unaudited)

4



PCB Bancorp and Subsidiary
Consolidated Statements of Income (Unaudited)
(in thousands, except share and per share data)
 
 
Three Months Ended March 31,
 
 
2020
 
2019
Interest income:
 
 
 
 
Interest and fees on loans
 
$
20,406

 
$
20,934

Interest on tax-exempt investment securities
 
38

 
39

Interest on investment securities
 
606

 
1,054

Interest and dividends on other interest-earning assets
 
610

 
925

Total interest income
 
21,660

 
22,952

Interest expense:
 
 
 
 
Interest on deposits
 
4,992

 
5,665

Interest on borrowings
 
102

 
134

Total interest expense
 
5,094

 
5,799

Net interest income
 
16,566

 
17,153

Provision (reversal) for loan losses
 
2,896

 
(85
)
Net interest income after provision for loan losses
 
13,670

 
17,238

Noninterest income:
 
 
 
 
Service charges and fees on deposits
 
390

 
364

Loan servicing income
 
554

 
631

Gain on sale of loans
 
725

 
1,120

Other income
 
357

 
294

Total noninterest income
 
2,026

 
2,409

Noninterest expense:
 
 
 
 
Salaries and employee benefits
 
6,551

 
6,622

Occupancy and equipment
 
1,380

 
1,313

Professional fees
 
797

 
758

Marketing and business promotion
 
179

 
228

Data processing
 
358

 
318

Director fees and expenses
 
221

 
189

Regulatory assessments
 
219

 
116

Other expenses
 
862

 
745

Total noninterest expense
 
10,567

 
10,289

Income before income taxes
 
5,129

 
9,358

Income tax expense
 
1,557

 
2,794

Net income
 
$
3,572

 
$
6,564

 
 
 
 
 
Earnings per common share, basic
 
$
0.23

 
$
0.41

Earnings per common share, diluted
 
$
0.23

 
$
0.40

 
 
 
 
 
Weighted-average common shares outstanding, basic
 
15,505,699

 
15,999,464

Weighted-average common shares outstanding, diluted
 
15,700,144

 
16,271,269

 
 
 
 
 
See Accompanying Notes to Consolidated Financial Statements (Unaudited)

5



PCB Bancorp and Subsidiary
Consolidated Statements of Comprehensive Income (Unaudited)
(in thousands)
 
 
Three Months Ended March 31,
 
 
2020
 
2019
Net income
 
$
3,572

 
$
6,564

Other comprehensive income:
 
 
 
 
Unrealized gain on securities available-for-sale arising during the period
 
1,342

 
1,172

Income tax benefit related to items of other comprehensive income
 
(394
)
 
(345
)
Total other comprehensive income, net of tax
 
948

 
827

Total comprehensive income
 
$
4,520

 
$
7,391

 
 
 
 
 
See Accompanying Notes to Consolidated Financial Statements (Unaudited)

6



PCB Bancorp and Subsidiary
Consolidated Statements of Changes in Shareholders’ Equity (Unaudited)
(in thousands, except share data)
 
 
Three Months Ended
 
 
 
 
Shareholders Equity
 
 
Common Stock Outstanding Shares
 
Common Stock
 
Retained Earnings
 
Accumulated Other Comprehensive Income (Loss)
 
Total
Balance at January 1, 2019
 
15,977,754

 
$
174,366

 
$
37,577

 
$
(1,647
)
 
$
210,296

Cumulative effect adjustment upon adoption of new lease accounting standard
 

 

 
(53
)
 

 
(53
)
Adjusted balance at January 1, 2019
 
15,977,754

 
174,366

 
37,524

 
(1,647
)
 
210,243

Comprehensive income
 
 
 
 
 
 
 
 
 
 
Net income
 

 

 
6,564

 

 
6,564

Other comprehensive income, net of tax
 

 

 

 
827

 
827

Share-based compensation expense
 

 
161

 

 

 
161

Stock options exercised
 
33,397

 
216

 

 

 
216

Cash dividends declared on common stock ($0.05 per share)
 

 

 
(800
)
 

 
(800
)
Balance at March 31, 2019
 
16,011,151

 
$
174,743

 
$
43,288

 
$
(820
)
 
$
217,211

 
 
 
 
 
 
 
 
 
 
 
Balance at January 1, 2020
 
15,707,016

 
$
169,221

 
$
57,670

 
$
(57
)
 
$
226,834

Comprehensive income
 
 
 
 
 
 
 
 
 
 
Net income
 

 

 
3,572

 

 
3,572

Other comprehensive income, net of tax
 

 

 

 
948

 
948

Issuance of restricted stock
 
1,000

 

 

 

 

Repurchase of common stock
 
(428,474
)
 
(6,487
)
 

 

 
(6,487
)
Share-based compensation expense
 

 
194

 

 

 
194

Stock options exercised
 
90,544

 
604

 

 

 
604

Cash dividends declared on common stock ($0.10 per share)
 

 

 
(1,540
)
 

 
(1,540
)
Balance at March 31, 2020
 
15,370,086

 
$
163,532

 
$
59,702

 
$
891

 
$
224,125

 
 
 
 
 
 
 
 
 
 
 
See Accompanying Notes to Consolidated Financial Statements (Unaudited)


7



PCB Bancorp and Subsidiary
Consolidated Statements of Cash Flows (Unaudited)
(in thousands)
 
 
Three Months Ended March 31,
 
 
2020
 
2019
Cash flows from operating activities
 
 
 
 
Net income
 
$
3,572

 
$
6,564

Adjustments to reconcile net income to net cash provided by (used in) operating activities:
 
 
 
 
Depreciation of premises and equipment
 
367

 
373

Net amortization of premiums on securities
 
189

 
188

Net accretion of discounts on loans
 
(1,028
)
 
(858
)
Net accretion of deferred loan costs (fees)
 
(121
)
 
(78
)
Amortization of servicing assets
 
604

 
516

Provision (reversal) for loan losses
 
2,896

 
(85
)
Deferred tax benefit
 
(246
)
 
(219
)
Stock-based compensation
 
194

 
161

Gain on sale of loans
 
(725
)
 
(1,120
)
Originations of loans held-for-sale
 
(26,686
)
 
(21,451
)
Proceeds from sales of and principal collected on loans held-for-sale
 
14,110

 
24,722

Change in accrued interest receivable and other assets
 
1,954

 
1,026

Change in accrued interest payable and other liabilities
 
(1,458
)
 
296

Net cash provided by (used in) operating activities
 
(6,378
)
 
10,035

Cash flows from investing activities
 
 
 
 
Purchase of securities available-for-sale
 
(7,526
)
 
(1,967
)
Proceeds from maturities, calls, and paydowns of securities available-for-sale
 
7,703

 
5,634

Purchase of securities held-to-maturity
 

 
(2,150
)
Proceeds from maturities and paydowns of securities held-to-maturity
 
417

 
554

Proceeds from sale of loans held-for-sale previously classified as held-for-investment
 
664

 
303

Net change in loans held-for-investment
 
(1,497
)
 
(4,472
)
Purchases of premises and equipment
 
(1,404
)
 
(44
)
Net cash used in investing activities
 
(1,643
)
 
(2,142
)
Cash flows from financing activities
 
 
 
 
Net increase (decrease) in deposits
 
(1,865
)
 
4,005

Proceeds from long-term Federal Home Loan Bank advances
 
60,000

 

Stock options exercised
 
604

 
216

Repurchase of common stock
 
(6,487
)
 

Cash dividends paid on common stock
 
(1,540
)
 
(800
)
Net cash provided by financing activities
 
50,712

 
3,421

Net increase in cash and cash equivalents
 
42,691

 
11,314

Cash and cash equivalents at beginning of period
 
146,228

 
162,273

Cash and cash equivalents at end of period
 
$
188,919

 
$
173,587

 
 
 
 
 
See Accompanying Notes to Consolidated Financial Statements (Unaudited)

8



PCB Bancorp and Subsidiary
Consolidated Statements of Cash Flows, Continued (Unaudited)
(in thousands)
 
 
Three Months Ended March 31,
 
 
2020
 
2019
Supplemental disclosures of cash flow information:
 
 
 
 
Interest paid
 
$
6,874

 
$
7,412

Income taxes paid
 
18

 
7

Supplemental disclosures of non-cash investment activities:
 
 
 
 
Loans transferred to loans held-for-sale
 
$
1,355

 
$
303

Loans transferred to other real estate owned
 
54

 
50

Right of use assets obtained in exchange for lease obligations
 
38

 
65

 
 
 
 
 
See Accompanying Notes to Consolidated Financial Statements (Unaudited)


9



PCB Bancorp and Subsidiary
Notes to Consolidated Financial Statements (Unaudited)
Note 1 - Basis of Presentation and Significant Accounting Policies
Nature of Operations
PCB Bancorp (collectively, with its consolidated subsidiary, the “Company,” “we,” “us” or “our”) is a bank holding company whose subsidiary is Pacific City Bank (the “Bank”). The Company changed its corporate name from “Pacific City Financial Corporation” to “PCB Bancorp” in July 2019. The Bank is a single operating segment that operates 11 full-service branches in Los Angeles and Orange counties, California, one full-service branch in each of Englewood Cliffs, New Jersey and Bayside, New York, and 10 loan production offices (“LPOs”) in Irvine, Artesia and Los Angeles, California; Annandale, Virginia; Chicago, Illinois; Atlanta, Georgia; Bellevue, Washington; Aurora, Colorado; Carrollton, Texas; and New York, New York. The Bank offers a broad range of loans, deposits, and other products and services predominantly to small and middle market businesses and individuals.
Basis of Presentation
The accompanying unaudited interim consolidated financial statements have been prepared pursuant to Article 10 of SEC Regulation S-X and other SEC rules and regulations for reporting on the Quarterly Report on Form 10-Q. Accordingly, certain disclosures required by U.S. generally accepted accounting principles (“GAAP”) are not included herein. These interim statements should be read in conjunction with the audited consolidated financial statements and notes included in the Annual Report on Form 10-K for the year ended December 31, 2019 filed by the Company with the SEC. The December 31, 2019 balance sheet presented herein has been derived from the audited financial statements included in the Annual Report on Form 10-K for the year ended December 31, 2019 filed with the SEC, but does not include all of the disclosures required by GAAP for complete financial statements.
In the opinion of management of the Company, the accompanying unaudited interim consolidated financial statements reflect all of the adjustments (consisting of normal recurring adjustments) necessary for a fair presentation of the consolidated financial condition and consolidated results of operations as of the dates and for the periods presented. Certain reclassifications have been made in the prior period financial statements to conform to the current period presentation. The results of operations for the three months ended March 31, 2020 are not necessarily indicative of the results that may be expected for the year ending December 31, 2020.
Principles of Consolidation
The consolidated financial statements include the accounts of PCB Bancorp and its wholly owned subsidiary as of March 31, 2020 and December 31, 2019 and for the three and three months ended March 31, 2020 and 2019. Significant inter-company accounts and transactions have been eliminated in consolidation. Unless the context requires otherwise, all references to the Company include its wholly owned subsidiary.
Significant Accounting Policies
The accounting and reporting policies of the Company are based upon GAAP and conform to predominant practices within the banking industry. The Company has not made any significant changes in its critical accounting policies from those disclosed in its Annual Report on Form 10-K for the year ended December 31, 2019 filed with the SEC.
Use of Estimates in the Preparation of Financial Statements
The preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenues and expenses during the reporting period. These estimates are subject to change and such change could have a material effect on the consolidated financial statements. Actual results may differ from those estimates.

10



Adopted Accounting Pronouncements
During the three months ended March 31, 2020, there were no significant accounting pronouncements applicable to the Company that became effective.
Recent Accounting Pronouncements Not Yet Adopted
The following is recently issued accounting pronouncements applicable to the Company that has not yet been adopted:
In June 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-13, “Financial Instruments-Credit Losses (Topic 326).” The amendments in this ASU require that entities change the impairment model for most financial assets that are measured at amortized cost and certain other instruments from an incurred loss model to an expected loss model. Under this model, entities will estimate credit losses over the entire contractual term of the instrument from the date of initial recognition of that instrument. It includes financial assets such as loan receivables, held-to-maturity debt securities, net investment in leases that are not accounted for at fair value through net income, and certain off-balance sheet credit exposures. This ASU is effective for public business entities that are SEC filers for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. In 2019, the FASB amended this ASU, which delays the effective date to 2023 for certain SEC filers that are Smaller Reporting Companies, which would apply to the Company. The Company plans to adopt this ASU at the delayed effective date of January 1, 2023.
Note 2 - Fair Value Measurements
Accounting Standards Codification (“ASC”) 820, Fair Value Measurements and Disclosures, defines fair value, establishes a framework for measuring fair value including a three-level valuation hierarchy, and expands disclosures about fair value measurements. Fair value is the exchange price that would be received for an asset or paid to transfer a liability (i.e. an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The three-level fair value hierarchy requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The three levels of inputs that may be used to measure fair value are defined as follows:
Level 1: Quoted prices (unadjusted) for identical assets or liabilities in active markets that the entity has the ability to access as of the measurement date.
Level 2: Significant observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data.
Level 3: Significant unobservable inputs that reflect a reporting entity’s own assumptions about the assumptions that market participants would use in pricing an asset or liability.
Fair value is measured on a recurring basis for certain assets and liabilities in which fair value is the primary basis of accounting. Additionally, fair value is used on a non-recurring basis to evaluate certain assets or liabilities for impairment or for disclosure purposes. Categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The Company records securities available-for-sale at fair value on a recurring basis. Certain other assets, such as loans held-for-sale, impaired loans, servicing assets and other real estate owned (“OREO”) are recorded at fair value on a non-recurring basis. Non-recurring fair value measurements typically involve assets that are periodically evaluated for impairment and for which any impairment is recorded in the period in which the re-measurement is performed. The following is a description of valuation methodologies used for assets and liabilities recorded at fair value:
Investment securities: The fair values of securities available-for-sale are determined by obtaining quoted prices on nationally recognized securities exchanges (Level 1) or matrix pricing, which is a mathematical technique used widely in the industry to value debt securities without relying exclusively on quoted prices for specific securities but rather by relying on the securities’ relationship to other benchmark quoted securities (Level 2). Management reviews the valuation techniques and assumptions used by the provider and determines that the provider uses widely accepted valuation techniques based on observable market inputs appropriate for the type of security being measured. Securities held-to-maturity are not measured at fair value on a recurring basis.
Loans held-for-sale: The Company records SBA loans held-for-sale, residential property loans held-for-sale and certain non-residential real estate loans held-for-sale at the lower of cost or fair value, on an aggregate basis. The Company obtains fair values from a third party independent valuation service provider. Loans held-for-sale accounted for at the lower of cost or fair value are considered to be recognized at fair value when they are recorded at below cost, on an aggregate basis, and are classified as Level 2.

11



Impaired loans: The Company records fair value adjustments on certain loans that reflect (i) partial write-downs, through charge-offs or specific reserve allowances, that are based on the current appraised or market-quoted value of the underlying collateral or (ii) the full charge-off of the loan carrying value. In some cases, the properties for which market quotes or appraised values have been obtained are located in areas where comparable sales data is limited, outdated, or unavailable. Fair value estimates for collateral-dependent impaired loans are obtained from real estate brokers or other third-party consultants, and are classified as Level 3.
Other real estate owned: The Company initially records OREO at fair value at the time of foreclosure. Thereafter, OREO is recorded at the lower of cost or fair value based on their subsequent changes in fair value. The fair value of OREO is generally based on recent real estate appraisals adjusted for estimated selling costs. These appraisals may utilize a single valuation approach or a combination of approaches including comparable sales and the income approach. Adjustments are routinely made in the appraisal process by the appraisers to adjust for differences between the comparable sales and income data available. Such adjustments may be significant and result in a Level 3 classification due to the unobservable inputs used for determining fair value. Only OREO with a valuation allowance are considered to be carried at fair value.
Servicing Assets: Servicing assets represent the value associated with servicing loans that have been sold. The fair value for servicing assets is determined through discounted cash flow analysis and utilizes discount rates and prepayment speed assumptions as inputs. All of these assumptions require a significant degree of management estimation and judgment. The fair market valuation is performed on a quarterly basis for servicing assets. Servicing assets are accounted for at the lower of cost or market value and considered to be recognized at fair value when they are recorded at below cost and are classified as Level 3.
Assets and Liabilities Measured at Fair Value on a Recurring Basis
The following table presents the Company’s assets and liabilities measured at fair value on a recurring basis as of dates indicated:
 
 
Fair Value Measurement Level
 
 
($ in thousands)
 
Quoted Prices in Active Markets for Identical Assets
(Level 1)
 
Significant Other Observable Inputs
(Level 2)
 
Significant Unobservable Inputs
(Level 3)
 
Total
March 31, 2020
 
 
 
 
 
 
 
 
Securities available-for-sale:
 
 
 
 
 
 
 
 
U.S. government agency and U.S. government sponsored enterprise securities:
 
 
 
 
 
 
 
 
Residential mortgage-backed securities
 
$

 
$
44,965

 
$

 
$
44,965

Residential collateralized mortgage obligations
 

 
39,396

 

 
39,396

SBA loan pool securities
 

 
13,431

 

 
13,431

Municipal bonds
 

 
776

 

 
776

Total securities available-for-sale
 

 
98,568

 

 
98,568

Total assets measured at fair value on a recurring basis
 
$

 
$
98,568

 
$

 
$
98,568

Total liabilities measured at fair value on a recurring basis
 
$

 
$

 
$

 
$

December 31, 2019
 
 
 
 
 
 
 
 
Securities available-for-sale:
 
 
 
 
 
 
 
 
U.S. government agency and U.S. government sponsored enterprise securities:
 
 
 
 
 
 
 
 
Residential mortgage-backed securities
 
$

 
$
38,738

 
$

 
$
38,738

Residential collateralized mortgage obligations
 

 
43,894

 

 
43,894

SBA loan pool securities
 

 
14,152

 

 
14,152

Municipal bonds
 

 
782

 

 
782

Total securities available-for-sale
 

 
97,566

 

 
97,566

Total assets measured at fair value on a recurring basis
 
$

 
$
97,566

 
$

 
$
97,566

Total liabilities measured at fair value on a recurring basis
 
$

 
$

 
$

 
$

 
 
 
 
 
 
 
 
 

12



Assets and Liabilities Measured at Fair Value on a Non-Recurring Basis
The following table presents the Company’s assets and liabilities measured at fair value on a non-recurring basis as of dates indicated:
 
 
Fair Value Measurement Level
 
 
($ in thousands)
 
Quoted Prices in Active Markets for Identical Assets
(Level 1)
 
Significant Other Observable Inputs
(Level 2)
 
Significant Unobservable Inputs
(Level 3)
 
Total
March 31, 2020
 
 
 
 
 
 
 
 
Impaired loans:
 
 
 
 
 
 
 
 
SBA property
 
$

 
$

 
$
294

 
$
294

Commercial lines of credit
 

 

 
1,855

 
1,855

SBA commercial term
 

 

 
25

 
25

Total impaired loans
 

 

 
2,174

 
2,174

Total assets measured at fair value on a non-recurring basis
 
$

 
$

 
$
2,174

 
$
2,174

Total liabilities measured at fair value on a non-recurring basis
 
$

 
$

 
$

 
$

December 31, 2019
 
 
 
 
 
 
 
 
Impaired loans:
 
 
 
 
 
 
 
 
SBA property
 
$

 
$

 
$
116

 
$
116

Commercial lines of credit
 

 

 
1,562

 
1,562

Total impaired loans
 

 

 
1,678

 
1,678

Total assets measured at fair value on a non-recurring basis
 
$

 
$

 
$
1,678

 
$
1,678

Total liabilities measured at fair value on a non-recurring basis
 
$

 
$

 
$

 
$

 
 
 
 
 
 
 
 
 
The following table presents quantitative information about level 3 fair value measurements for assets measured at fair value on a non-recurring basis as of the dates indicated:
($ in thousands)
 
Fair Value
 
Valuation Technique(s)
 
Unobservable Input(s)
 
Range (Weighted-Average)
March 31, 2020
 
 
 
 
 
 
 
 
Impaired loans:
 
 
 
 
 
 
 
 
SBA property
 
$
294

 
Fair value of collateral
 
NM
 
NM
Commercial lines of credit
 
$
1,855

 
Sales comparison approach
 
Adjustment for differences between the comparable estate sales
 
-14% to 26% (-0.35%)
 
 
 
 
Income approach
 
Adjustment for differences in net operating income expectations
 
-4% to -11% (-6.20%)
 
 
 
 
 
 
Capitalization rate
 
5%
SBA commercial term
 
$
25

 
Fair value of collateral
 
NM
 
NM
December 31, 2019
 
 
 
 
 
 
 
 
Impaired loans:
 
 
 
 
 
 
 
 
SBA property
 
$
116

 
Fair value of collateral
 
NM
 
NM
Commercial lines of credit
 
$
1,562

 
Sales comparison approach
 
Adjustment for differences between the comparable estate sales
 
-4% to 26% (0.86%)
 
 
 
 
Income approach
 
Adjustment for differences in net operating income expectations
 
-4% to -11% (-6.20%)
 
 
 
 
 
 
Capitalization rate
 
5.0%
 
 
 
 
 
 
 
 
 

13



For assets measured at fair value, the following table presents the total net losses, which include charge-offs, recoveries, specific reserves, impairment on servicing assets, gain (loss) on sale of OREO, and OREO valuation write-downs recorded for the periods indicated:
 
 
Three Months Ended March 31,
($ in thousands)
 
2020
 
2019
Collateral dependent impaired loans:
 
 
 
 
SBA property
 
$
(27
)
 
$
(2
)
Commercial lines of credit
 
(506
)
 

SBA commercial term
 
(164
)
 

Net losses recognized
 
$
(697
)
 
$
(2
)
 
 
 
 
 
Fair Value of Financial Instruments
The fair value of a financial instrument is the amount at which the asset or obligation could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale. Fair value estimates are made at a specific point in time based on relevant market information and information about the financial instrument. These estimates do not reflect any premium or discount that could result from offering for sale at one time the entire holdings of a particular financial instrument. Because no market value exists for a significant portion of the financial instruments, fair value estimates are based on judgments regarding future expected loss experience, current economic conditions, risk characteristics of various financial instruments, and other factors. These estimates are subjective in nature, involve uncertainties and matters of judgment and, therefore, cannot be determined with precision. Changes in assumptions could significantly affect the estimates.
Fair value estimates are based on financial instruments both on and off the consolidated balance sheet without attempting to estimate the value of anticipated future business and the value of assets and liabilities that are not considered financial instruments. Additionally, tax consequences related to the realization of the unrealized gains and losses can have a potential effect on fair value estimates and have not been considered in many of the estimates. The following methods and assumptions were used to estimate the fair value of significant financial instruments.
Financial assets: The carrying amounts of interest-bearing deposits with other financial institutions and accrued interest receivable are considered to approximate fair value. The fair values of investment securities are generally based on matrix pricing (Level 2). The fair value of loans is estimated based on a discounted cash flow approach under an exit price notion. The fair value reflects the estimated yield that would be negotiated with a willing market participant. Because sale transactions of such loans are not readily observable, as many of the loans have unique risk characteristics, the valuation is based on significant unobservable inputs (Level 3). It is not practical to determine the fair value of Federal Home Loan Bank (“FHLB”) and other restricted stock due to restrictions placed on its transferability.
Financial liabilities: The carrying amounts of accrued interest payable are considered to approximate fair value. The fair value of deposits is estimated based on discounted cash flows. The discount rate is derived from the interest rates currently being offered for similar remaining maturities. Non-maturity deposits are estimated based on their historical decaying experiences (Level 3). The fair value of FHLB advances is estimated based on discounted cash flows. The discount rate is derived from the current market rates for borrowings with similar remaining maturities (Level 2).
Off-balance-sheet financial instruments: The fair value of commitments to extend credit and standby letters of credit is estimated using the fees currently charged to enter into similar agreements. The fair value of these financial instruments is not material and is excluded from the table below.

14



The following table presents the carrying value and estimated fair values of financial assets and liabilities as of the dates indicated:
 
 
Carrying Value
 
Fair Value
 
Fair Value Measurements
($ in thousands)
 
 
 
Level 1
 
Level 2
 
Level 3
March 31, 2020
 
 
 
 
 
 
 
 
 
 
Financial assets:
 
 
 
 
 
 
 
 
 
 
Interest-bearing deposits in other financial institutions
 
$
174,039

 
$
174,039

 
$
174,039

 
$

 
$

Securities available-for-sale
 
98,568

 
98,568

 

 
98,568

 

Securities held-to-maturity
 
19,711

 
20,449

 

 
20,449

 

Loans held-for-sale
 
16,191

 
17,069

 

 
17,069

 

Net loans held-for-investment
 
1,434,364

 
1,443,023

 

 

 
1,443,023

FHLB and other restricted stock
 
8,345

 
 N/A

 
 N/A

 
 N/A

 
 N/A

Accrued interest receivable
 
4,706

 
4,706

 
3

 
332

 
4,371

Financial liabilities:
 
 
 
 
 
 
 
 
 
 
Deposits
 
$
1,477,442

 
$
1,499,580

 
$

 
$

 
$
1,499,580

FHLB advances
 
80,000

 
80,248

 

 
80,248

 

Accrued interest payable
 
4,224

 
4,224

 

 
2

 
4,222

December 31, 2019
 
 
 
 
 
 
 
 
 
 
Financial assets:
 
 
 
 
 
 
 
 
 
 
Interest-bearing deposits in other financial institutions
 
$
128,420

 
$
128,420

 
$
128,420

 
$

 
$

Securities available-for-sale
 
97,566

 
97,566

 

 
97,566

 

Securities held-to-maturity
 
20,154

 
20,480

 

 
20,480

 

Loans held-for-sale
 
1,975

 
2,102

 

 
2,102

 

Net loans held-for-investment
 
1,436,451

 
1,449,383

 

 

 
1,449,383

FHLB and other restricted stock
 
8,345

 
 N/A

 
 N/A

 
 N/A

 
 N/A

Accrued interest receivable
 
5,136

 
5,136

 
78

 
375

 
4,683

Financial liabilities:
 
 
 
 
 
 
 
 
 
 
Deposits
 
$
1,479,307

 
$
1,468,540

 
$

 
$

 
$
1,468,540

FHLB advances
 
20,000

 
20,092

 

 
20,092

 

Accrued interest payable
 
6,004

 
6,004

 

 
1

 
6,003

 
 
 
 
 
 
 
 
 
 
 


15



Note 3 - Investment Securities
Debt securities have been classified as available-for-sale or held-to-maturity in the consolidated balance sheets according to management’s intent. The following table presents the amortized cost and fair value of the investment securities as of the dates indicated:
($ in thousands)
 
Amortized Cost
 
Gross Unrealized Gain
 
Gross Unrealized Loss
 
Fair Value
March 31, 2020
 
 
 
 
 
 
 
 
Securities available-for-sale:
 
 
 
 
 
 
 
 
U.S. government agency and U.S. government sponsored enterprise securities:
 
 
 
 
 
 
 
 
Residential mortgage-backed securities
 
$
43,917

 
$
1,076

 
$
(28
)
 
$
44,965

Residential collateralized mortgage obligations
 
39,509

 
331

 
(444
)
 
39,396

SBA loan pool securities
 
13,327

 
133

 
(29
)
 
13,431

Municipal bonds
 
758

 
18

 

 
776

Total securities available-for-sale
 
$
97,511

 
$
1,558

 
$
(501
)
 
$
98,568

Securities held-to-maturity:
 
 
 
 
 
 
 
 
U.S. government agency and U.S. government sponsored enterprise residential mortgage-backed securities
 
$
14,779

 
$
388

 
$

 
$
15,167

Municipal bonds
 
4,932

 
350

 

 
5,282

Total securities held-to-maturity
 
$
19,711

 
$
738

 
$

 
$
20,449

December 31, 2019
 
 
 
 
 
 
 
 
Securities available-for-sale:
 
 
 
 
 
 
 
 
U.S. government agency and U.S. government sponsored enterprise securities:
 
 
 
 
 
 
 
 
Residential mortgage-backed securities
 
$
38,793

 
$
96

 
$
(151
)
 
$
38,738

Residential collateralized mortgage obligations
 
44,115

 
36

 
(257
)
 
43,894

SBA loan pool securities
 
14,179

 
34

 
(61
)
 
14,152

Municipal bonds
 
764

 
18

 

 
782

Total securities available-for-sale
 
$
97,851

 
$
184

 
$
(469
)
 
$
97,566

Securities held-to-maturity:
 
 
 
 
 
 
 
 
U.S. government agency and U.S. government sponsored enterprise residential mortgage-backed securities
 
$
15,215

 
$
70

 
$
(81
)
 
$
15,204

Municipal bonds
 
4,939

 
337

 

 
5,276

Total securities held-to-maturity
 
$
20,154

 
$
407

 
$
(81
)
 
$
20,480

 
 
 
 
 
 
 
 
 
As of March 31, 2020 and December 31, 2019, pledged securities were $118.3 million and $99.3 million, respectively. These securities were pledged for the State Deposit from the California State Treasurer.


16



The following table presents the amortized cost and fair value of the investment securities by contractual maturity as of March 31, 2020. Expected maturities may differ from contractual maturities, if borrowers have the right to call or prepay obligations with or without call or prepayment penalties. Securities not due at a single maturity date are shown separately.
 
 
Securities Available-For-Sale
 
Securities Held-To-Maturity
($ in thousands)
 
Amortized Cost
 
Fair Value
 
Amortized Cost
 
Fair Value
Within one year
 
$

 
$

 
$
101

 
$
102

One to five years
 

 

 
2,217

 
2,280

Five to ten years
 
758

 
776

 
285

 
299

Greater than ten years
 

 

 
2,329

 
2,601

Residential mortgage-backed securities, residential collateralized mortgage obligations and SBA loan pool securities
 
96,753

 
97,792

 
14,779

 
15,167

Total
 
$
97,511

 
$
98,568

 
$
19,711

 
$
20,449

 
 
 
 
 
 
 
 
 
The following table presents proceeds from sales and calls of securities available-for-sale and the associated gross gains and losses realized through earnings upon the sales and calls of securities available-for-sale for the periods indicated:
 
 
Three Months Ended March 31,
($ in thousands)
 
2020
 
2019
Gross realized gains on sales and calls of securities available-for-sale
 
$

 
$

Gross realized losses on sales and calls of securities available-for-sale
 

 

Net realized gains (losses) on sales and calls of securities available-for-sale
 
$

 
$

Proceeds from sales and calls of securities available-for-sale
 
$

 
$

Tax expense on sales and calls of securities available-for-sale
 
$

 
$

 
 
 
 
 



17



The following table summarizes the investment securities with unrealized losses by security type and length of time in a continuous unrealized loss position as of the dates indicated:
 
 
Length of Time that Individual Securities Have Been In a Continuous Unrealized Loss Position
 
 
Less Than 12 Months
 
12 Months or Longer
 
Total
($ in thousands)
 
Fair Value
 
Gross Unrealized Losses
 
Number of Securities
 
Fair Value
 
Gross Unrealized Losses
 
Number of Securities
 
Fair Value
 
Gross Unrealized Losses
 
Number of Securities
March 31, 2020
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Securities available-for-sale:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
U.S. government agency and U.S. government sponsored enterprise securities:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Residential mortgage-backed securities
 
$
329

 
$
(8
)
 
1

 
$
1,329

 
$
(20
)
 
2

 
$
1,658

 
$
(28
)
 
3

Residential collateralized mortgage obligations
 
6,253

 
(179
)
 
5

 
14,070

 
(265
)
 
11

 
20,323

 
(444
)
 
16

SBA loan pool securities
 
1,587

 
(16
)
 
2

 
1,785

 
(13
)
 
3

 
3,372

 
(29
)
 
5

Municipal bonds
 

 

 

 

 

 

 

 

 

Total securities available-for-sale
 
$
8,169

 
$
(203
)
 
8

 
$
17,184

 
$
(298
)
 
16

 
$
25,353

 
$
(501
)
 
24

December 31, 2019
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Securities available-for-sale:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
U.S. government agency and U.S. government sponsored enterprise securities:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Residential mortgage-backed securities
 
$
5,401

 
$
(28
)
 
5

 
$
15,772

 
$
(123
)
 
23

 
$
21,173

 
$
(151
)
 
28

Residential collateralized mortgage obligations
 
15,392

 
(52
)
 
13

 
19,834

 
(205
)
 
23

 
35,226

 
(257
)
 
36

SBA loan pool securities
 
4,787

 
(38
)
 
5

 
2,308

 
(23
)
 
4

 
7,095

 
(61
)
 
9

Total securities available-for-sale
 
$
25,580

 
$
(118
)
 
23

 
$
37,914

 
$
(351
)
 
50

 
$
63,494

 
$
(469
)
 
73

Securities held-to-maturity:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
U.S. government agency and U.S. government sponsored enterprise residential mortgage-backed securities
 
$

 
$

 

 
$
6,842

 
$
(81
)
 
7

 
$
6,842

 
$
(81
)
 
7

Total securities held-to-maturity
 
$

 
$

 

 
$
6,842

 
$
(81
)
 
7

 
$
6,842

 
$
(81
)
 
7

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 



18



The Company performs an other-than-temporary impairment (“OTTI”) assessment at least on a quarterly basis. OTTI is recognized when fair value is below the amortized cost where: (i) an entity has the intent to sell the security; (ii) it is more likely than not that an entity will be required to sell the security before recovery of its amortized cost basis; or (iii) an entity does not expect to recover the entire amortized cost basis of the security.
All individual securities in a continuous unrealized loss position for 12 months or more as of March 31, 2020 and December 31, 2019 had an investment grade rating upon purchase. The issuers of these securities have not established any cause for default on these securities and various rating agencies have reaffirmed their long-term investment grade status as of March 31, 2020 and December 31, 2019. These securities have fluctuated in value since their purchase dates as market interest rates fluctuated. The Company does not intend to sell these securities and it is more likely than not that the Company will not be required to sell before the recovery of its amortized cost basis. The Company determined that the investment securities with unrealized losses for twelve months or more are not other-than-temporary impaired, and, therefore, no impairment was recognized during the three months ended March 31, 2020 and 2019.
Note 4 - Loans and Allowance for Loan Losses
Loans Held-For-Investment
The following table presents, by recorded investment, the composition of the Company’s loans held-for-investment (net of deferred fees and costs) as of the dates indicated:
($ in thousands)
 
March 31, 2020
 
December 31, 2019
Real estate loans:
 
 
 
 
Commercial property
 
$
812,484

 
$
803,014

Residential property
 
227,492

 
235,046

SBA property
 
125,322

 
129,837

Construction
 
19,178

 
19,164

Total real estate loans
 
1,184,476

 
1,187,061

Commercial and industrial loans:
 
 
 
 
Commercial term
 
101,943

 
103,380

Commercial lines of credit
 
116,873

 
111,768

SBA commercial term
 
24,745

 
25,332

Total commercial and industrial loans
 
243,561

 
240,480

Other consumer loans
 
23,001

 
23,290

Loans held-for-investment
 
1,451,038

 
1,450,831

Allowance for loan losses
 
(16,674
)
 
(14,380
)
Net loans held-for-investment
 
$
1,434,364

 
$
1,436,451

 
 
 
 
 
In the ordinary course of business, the Company may grant loans to certain officers and directors, and the companies with which they are associated. As of March 31, 2020 and December 31, 2019, the Company had $3.7 million and $3.8 million, respectively, of such loans outstanding.


19



Allowance for Loan Losses
Changes in international, national, regional, and local economic and business conditions and developments from the COVID-19 pandemic affected the potential collectability of the loan portfolio, including the condition of various market segments, and has resulted in an additional allowance for loan losses of $2.7 million at March 31, 2020.
The following table presents the activities in allowance for loan losses by portfolio segment, which is consistent with the Company’s methodology for determining allowance for loan losses, for the three months ended March 31, 2020 and 2019:
 
 
Three Months Ended
($ in thousands)
 
Real Estate
 
Commercial and Industrial
 
Other Consumer
 
Total
Balance at January 1, 2020
 
$
9,854

 
$
4,354

 
$
172

 
$
14,380

Charge-offs
 
(27
)
 
(675
)
 
(76
)
 
(778
)
Recoveries on loans previously charged off
 
56

 
91

 
29

 
176

Provision (reversal) for loan losses
 
2,065

 
779

 
52

 
2,896

Balance at March 31, 2020
 
$
11,948

 
$
4,549

 
$
177

 
$
16,674

Balance at January 1, 2019
 
$
9,104

 
$
3,877

 
$
186

 
$
13,167

Charge-offs
 
(2
)
 

 
(44
)
 
(46
)
Recoveries on loans previously charged off
 
4

 
41

 
56

 
101

Provision for loan losses
 
218

 
(310
)
 
7

 
(85
)
Balance at March 31, 2019
 
$
9,324

 
$
3,608

 
$
205

 
$
13,137

 
 
 
 
 
 
 
 
 
The following tables present the information on allowance for loan losses and recorded investments by portfolio segment and impairment methodology as of the dates indicated:
($ in thousands)
 
Real Estate
 
Commercial and Industrial
 
Other Consumer
 
Total
March 31, 2020
 
 
 
 
 
 
 
 
Allowance for loan losses:
 
 
 
 
 
 
 
 
Individually evaluated for impairment
 
$
1

 
$
15

 
$

 
$
16

Collectively evaluated for impairment
 
11,947

 
4,534

 
177

 
16,658

Total
 
$
11,948

 
$
4,549

 
$
177

 
$
16,674

Loans receivable:
 
 
 
 
 
 
 
 
Individually evaluated for impairment
 
$
2,088

 
$
2,664

 
$

 
$
4,752

Collectively evaluated for impairment
 
1,182,388

 
240,897

 
23,001

 
1,446,286

Total
 
$
1,184,476

 
$
243,561

 
$
23,001

 
$
1,451,038

December 31, 2019
 
 
 
 
 
 
 
 
Allowance for loan losses:
 
 
 
 
 
 
 
 
Individually evaluated for impairment
 
$
4

 
$
15

 
$

 
$
19

Collectively evaluated for impairment
 
9,850

 
4,339

 
172

 
14,361

Total
 
$
9,854

 
$
4,354

 
$
172

 
$
14,380

Loans receivable:
 
 
 
 
 
 
 
 
Individually evaluated for impairment