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Loans and Allowance for Loan Losses (Tables)
 6 Months Ended
Jun. 30, 2020
Receivables [Abstract]  
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)
June 30, 2020
December 31, 2019
Real estate loans:
Commercial property
$813,409  $803,014  
Residential property
223,923  235,046  
SBA property
122,675  129,837  
Construction
20,432  19,164  
Total real estate loans
1,180,439  1,187,061  
Commercial and industrial loans:
Commercial term
98,936  103,380  
Commercial lines of credit
96,339  111,768  
SBA commercial term
22,650  25,332  
SBA PPP
133,675  —  
Total commercial and industrial loans
351,600  240,480  
Other consumer loans
21,550  23,290  
Loans held-for-investment
1,553,589  1,450,831  
Allowance for loan losses
(20,248) (14,380) 
Net loans held-for-investment
$1,533,341  $1,436,451  
Schedule of Loan Modification Related to COVID-19 The following table presents a summary of loans with modifications related to the COVID-19 pandemic by portfolio segment as of June 30, 2020:
Modification Type
($ in thousands)Payment DefermentInterest Only PaymentTotal
June 30, 2020
Real estate loans:
Commercial property
$369,716  $9,850  $379,566  
Residential property
44,804  —  44,804  
Commercial and industrial loans:
Commercial term
53,277  4,882  58,159  
Other consumer loans
1,507  —  1,507  
Total
$469,304  $14,732  $484,036  
Allowance for Loan Losses
The following table presents the activities in allowance for loan losses by portfolio segment, which is consistent with the Company’s methodology for determining allowance for loan losses, for the three months ended June 30, 2020 and 2019:
($ in thousands)Real EstateCommercial and IndustrialOther ConsumerTotal
Balance at April 1, 2020
$11,948  $4,549  $177  $16,674  
Charge-offs
(111) (241) (63) (415) 
Recoveries on loans previously charged off
—  114  20  134  
Provision (reversal) for loan losses
3,708  (85) 232  3,855  
Balance at June 30, 2020
$15,545  $4,337  $366  $20,248  
Balance at April 1, 2019
$9,324  $3,608  $205  $13,137  
Charge-offs
(17) (168) (67) (252) 
Recoveries on loans previously charged off
—  33  16  49  
Provision (reversal) for loan losses
404  (47) 37  394  
Balance at June 30, 2019
$9,711  $3,426  $191  $13,328  
The following table presents the activities in allowance for loan losses by portfolio segment, which is consistent with the Company’s methodology for determining allowance for loan losses, for the six months ended June 30, 2020 and 2019:
($ in thousands)Real EstateCommercial and IndustrialOther ConsumerTotal
Balance at January 1, 2020
$9,854  $4,354  $172  $14,380  
Charge-offs
(138) (916) (139) (1,193) 
Recoveries on loans previously charged off
56  205  49  310  
Provision for loan losses
5,773  694  284  6,751  
Balance at June 30, 2020
$15,545  $4,337  $366  $20,248  
Balance at January 1, 2019
$9,104  $3,877  $186  $13,167  
Charge-offs
(19) (168) (111) (298) 
Recoveries on loans previously charged off
4  74  72  150  
Provision (reversal) for loan losses
622  (357) 44  309  
Balance at June 30, 2019
$9,711  $3,426  $191  $13,328  
The following tables present the information on allowance for loan losses and recorded investments by portfolio segment and impairment methodology as of the dates indicated:
($ in thousands)Real EstateCommercial and IndustrialOther ConsumerTotal
June 30, 2020
Allowance for loan losses:
Individually evaluated for impairment
$1  $—  $—  $1  
Collectively evaluated for impairment
15,544  4,337  366  20,247  
Total
$15,545  $4,337  $366  $20,248  
Loans receivable:
Individually evaluated for impairment
$1,971  $2,398  $—  $4,369  
Collectively evaluated for impairment
1,178,468  349,202  21,550  1,549,220  
Total
$1,180,439  $351,600  $21,550  $1,553,589  
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
$2,158  $2,401  $—  $4,559  
Collectively evaluated for impairment
1,184,903  238,079  23,290  1,446,272  
Total
$1,187,061  $240,480  $23,290  $1,450,831  
Risk Categories for Loans by Portfolio Segment
The following table presents the risk categories for the recorded investment in loans by portfolio segment as of dates indicated:
($ in thousands)PassSpecial MentionSubstandardDoubtfulTotal
June 30, 2020
Real estate loans:
Commercial property
$813,072  $—  $337  $—  $813,409  
Residential property
223,923  —  —  —  223,923  
SBA property
119,566  71  3,038  —  122,675  
Construction
20,432  —  —  —  20,432  
Commercial and industrial loans:
Commercial term
98,936  —  —  —  98,936  
Commercial lines of credit
94,371  —  1,968  —  96,339  
SBA commercial term
22,254  —  396  —  22,650  
SBA PPP
133,675  —  —  —  133,675  
Other consumer loans
21,480  —  70  —  21,550  
Total
$1,547,709  $71  $5,809  $—  $1,553,589  
December 31, 2019
Real estate loans:
Commercial property
$802,373  $—  $641  $—  $803,014  
Residential property
235,046  —  —  —  235,046  
SBA property
124,135  72  5,630  —  129,837  
Construction
17,453  1,711  —  —  19,164  
Commercial and industrial loans:
Commercial term
103,380  —  —  —  103,380  
Commercial lines of credit
109,880  —  1,888  —  111,768  
SBA commercial term
24,677  —  655  —  25,332  
Other consumer loans
23,242  —  48  —  23,290  
Total
$1,440,186  $1,783  $8,862  $—  $1,450,831  
Aging of Past Due Accruing Loans and Nonaccrual Loans by Segment
The following table presents the aging of past due recorded investment in accruing loans and nonaccrual loans by portfolio segment as of dates indicated:
Still Accruing
($ in thousands)30 to 59 Days Past Due60 to 89 Days Past Due90 or More Days Past Due NonaccrualTotal Past Due and Nonaccrual
June 30, 2020
Real estate loans:
Residential property
$262  $—  $696  $—  $958  
SBA property
—  —  —  1,351  1,351  
Commercial and industrial loans:
Commercial lines of credit
—  —  —  1,968  1,968  
SBA commercial term
—  —  —  381  381  
Other consumer loans
49  113  —  70  232  
Total
$311  $113  $696  $3,770  $4,890  
December 31, 2019
Real estate loans:
Residential property
$—  $697  $—  $—  $697  
SBA property
794  —  —  442  1,236  
Commercial and industrial loans:
Commercial lines of credit
—  —  —  1,888  1,888  
SBA commercial term
—  189  287  159  635  
Other consumer loans
99  39  —  48  186  
Total
$893  $925  $287  $2,537  $4,642  
Impairment by Portfolio Segment
The following table presents loans individually evaluated for impairment by portfolio segment as of the dates indicated. The recorded investment presents customer balances net of any partial charge-offs recognized on the loans and net of any deferred fees and costs.
With No Allowance RecordedWith an Allowance Recorded
($ in thousands)Recorded InvestmentUnpaid Principal BalanceRecorded InvestmentUnpaid Principal BalanceRelated Allowance
June 30, 2020
Real estate loans:
Commercial property
$337  $335  $—  $—  $—  
SBA property
1,458  1,596  176  176  1  
Commercial and industrial loans:
Commercial term
26  26  —  —  —  
Commercial lines of credit
1,968  1,968  —  —  —  
SBA commercial term
404  446  —  —  —  
Total
$4,193  $4,371  $176  $176  $1  
December 31, 2019
Real estate loans:
Commercial property
$339  $338  $—  $—  $—  
SBA property
1,699  1,828  120  154  4  
Commercial and industrial loans:
Commercial term
28  28  —  —  —  
Commercial lines of credit
1,888  1,888  —  —  —  
SBA commercial term
457  495  28  28  15  
Total
$4,411  $4,577  $148  $182  $19  
The following table presents information on the recorded investment in impaired loans by portfolio segment for the three months ended June 30, 2020 and 2019:
Three Months Ended June 30,
20202019
($ in thousands)Average Recorded InvestmentInterest IncomeAverage Recorded InvestmentInterest Income
Real estate loans:
Commercial property
$337  $6  $—  $—  
SBA property
1,692  4  1,666  6  
Commercial and industrial loans:
Commercial term
26  1  52  1  
Commercial lines of credit
2,074  —  —  —  
SBA commercial term
418  —  59  1  
Total
$4,547  $11  $1,777  $8  
The following table presents information on the recorded investment in impaired loans by portfolio segment for the six months ended June 30, 2020 and 2019:
Six Months Ended June 30,
20202019
($ in thousands)Average Recorded InvestmentInterest IncomeAverage Recorded InvestmentInterest Income
Real estate loans:
Commercial property
$338  $11  $—  $—  
Residential property
—  —  76  —  
SBA property
1,728  9  1,507  12  
Commercial and industrial loans:
Commercial term
26  1  57  2  
Commercial lines of credit
2,254  —  —  —  
SBA commercial term
480  1  150  2  
Total
$4,826  $22  $1,790  $16  
The following presents a summary of interest foregone on impaired loans for the periods indicated:
Three Months Ended June 30,
Six Months Ended June 30,
($ in thousands)2020201920202019
Interest income that would have been recognized had impaired loans performed in accordance with their original terms
$67  $32  $146  $64  
Less: interest income recognized on impaired loans on a cash basis
(11) (8) (22) (16) 
Interest income foregone on impaired loans
$56  $24  $124  $48  
Modified TDRs by Portfolio Segment
The following table presents the composition of loans that were modified as TDRs by portfolio segment as of the dates indicated:
June 30, 2020December 31, 2019
($ in thousands)AccruingNonaccrualTotalAccruingNonaccrualTotal
Real estate loans:
Commercial property
$337  $—  $337  $339  $—  $339  
SBA property
282  40  322  294  121  415  
Commercial and industrial loans:
Commercial term
26  —  26  28  —  28  
SBA commercial term
24  —  24  39  —  39  
Total
$669  $40  $709  $700  $121  $821  
The following table presents information on new loans that were modified as TDRs for the three months ended June 30, 2020 and 2019:
Three Months Ended June 30,
20202019
($ in thousands)
Number of Loans
Pre-Modification Outstanding Recorded InvestmentPost-Modification Outstanding Recorded InvestmentNumber of LoansPre-Modification Outstanding Recorded InvestmentPost-Modification Outstanding Recorded Investment
Real estate loans:
SBA property (1)
—  —  —  1  131  131  
Total
—  $—  $—  1  $131  $131  
(1) Modified by deferral of principal payment.
The following table presents information on new loans that were modified as TDRs for the six months ended June 30, 2020 and 2019:
Six Months Ended June 30,
20202019
($ in thousands)Number of LoansPre-Modification Outstanding Recorded InvestmentPost-Modification Outstanding Recorded InvestmentNumber of LoansPre-Modification Outstanding Recorded InvestmentPost-Modification Outstanding Recorded Investment
Real estate loans:
SBA property (1)
—  —  —  1  131  131  
Commercial and industrial loans:
SBA commercial term (1)
2  $37  $37  —  $—  $—  
Total
2  $37  $37  1  $131  $131  
(1) Modified by deferral of principal payment.
The following table presents information on loans that were modified as TDRs for which there was a payment default within twelve months following the modification for the six months ended June 30, 2020 and 2019:
Six Months Ended June 30,
20202019
($ in thousands)Number of LoansRecorded Investment at Date of DefaultNumber of LoansRecorded Investment at Date of Default
Commercial and industrial loans:
SBA commercial term
1  $26  —  $—  
Total
1  $26  —  $—  
Loans Held-for-Sale
The following table presents a summary of loans held-for-investment transferred to loans held-for-sale for the periods indicated:
Three Months Ended June 30,
Six Months Ended June 30,
($ in thousands)2020201920202019
Real estate loans:
Residential property
$—  $—  $1,125  $303  
Commercial and industrial loans:
SBA commercial term
—  —  230  —  
Total
$—  $—  $1,355  $303  
The following table presents a summary of loans held-for-sale transferred to loans held-for-investment for the periods indicated:
Three Months Ended June 30,
Six Months Ended June 30,
($ in thousands)2020201920202019
Real estate loans:
Residential property
$697  $—  $697  $—  
Total
$697  $—  $697  $—  
The following table presents a composition of loans held-for-sale as of the dates indicated:
($ in thousands)
June 30, 2020
December 31, 2019
Real estate loans:
Residential property
$3,267  $760  
SBA property
835  150  
Commercial and industrial loans:
SBA commercial term
—  1,065  
Total
$4,102  $1,975