Loans Receivable and Allowance for Loan Losses (Tables)

9 Months Ended

Sep. 30, 2020

Loans receivable (excluding mortgage loans held for sale, at fair value) at September 30, 2020 and December 31, 2019 are summarized as follows:

	September 30,			December 31,
	2020			2019
Mortgage loans:
1-4 Family residential
Investor-Owned	$	320,438		$	305,272
Owner-Occupied		93,340			91,943
Multifamily residential		284,775			250,239
Nonresidential properties		217,771			207,225
Construction and land		99,721			99,309
Nonmortgage loans:
Business loans (1)		96,700			10,877
Consumer loans (2)		9,806			1,231
		1,122,551			966,096
Net deferred loan origination costs		786			1,970
Allowance for loan losses		(14,381	)		(12,329	)
Loans receivable, net	$	1,108,956		$	955,737

(1)

As of September 30, 2020, business loans include $86,165 of Paycheck Protection Program (“PPP”) loans.

(2)

As of September 30, 2020, consumer loans include $8,668 related to Grain Technologies, LLC. Refer to Management’s Discussion and Analysis of Financial Conditions and Results of Operations for further discussion on Grain Technologies, LLC.

Schedule of Credit Risk Ratings by Loan Segment

The following tables present credit risk ratings by loan segment as of September 30, 2020 and December 31, 2019:

	September 30, 2020
	Mortgage Loans								Nonmortgage Loans
							Construction						Total
	1-4 Family		Multifamily		Nonresidential		and Land		Business		Consumer		Loans
Risk Rating:
Pass	$	403,062	$	277,822	$	212,699	$	83,149	$	96,700	$	9,806	$	1,083,238
Special mention		2,350		—		—		16,572		—		—		18,922
Substandard		8,366		6,953		5,072		—		—		—		20,391
Total	$	413,778	$	284,775	$	217,771	$	99,721	$	96,700	$	9,806	$	1,122,551

	December 31, 2019
	Mortgage Loans								Nonmortgage Loans
							Construction						Total
	1-4 Family		Multifamily		Nonresidential		and Land		Business		Consumer		Loans
Risk Rating:
Pass	$	386,022	$	249,066	$	202,761	$	75,997	$	10,877	$	1,231	$	925,954
Special mention		2,412		—		—		14,943		—		—		17,355
Substandard		8,781		1,173		4,464		8,369		—		—		22,787
Total	$	397,215	$	250,239	$	207,225	$	99,309	$	10,877	$	1,231	$	966,096

Schedule of Aging Analysis of Loans

An aging analysis of loans, as of September 30, 2020 and December 31, 2019, is as follows:

	September 30, 2020
			30-59		60-89		90 Days						90 Days
			Days		Days		or More				Nonaccrual		or More
	Current		Past Due		Past Due		Past Due		Total		Loans		Accruing
Mortgage loans:
1-4 Family residential
Investor-Owned	$	318,955	$	—	$	—	$	1,483	$	320,438	$	1,936	$	—
Owner-Occupied		90,381		—		1,509		1,450		93,340		3,269		—
Multifamily residential		284,555		—		10		210		284,775		210		—
Nonresidential properties		214,499		—		—		3,272		217,771		4,447		—
Construction and land		99,721		—		—		—		99,721		—		—
Nonmortgage loans:
Business		96,680		20		—		—		96,700		—		—
Consumer		9,806		—		—		—		9,806		—		—
Total	$	1,114,597	$	20	$	1,519	$	6,415	$	1,122,551	$	9,862	$	—

	December 31, 2019
			30-59		60-89		90 Days						90 Days
			Days		Days		or More				Nonaccrual		or More
	Current		Past Due		Past Due		Past Due		Total		Loans		Accruing
Mortgage loans:
1-4 Family residential
Investor-Owned	$	300,324	$	3,866	$	—	$	1,082	$	305,272	$	1,749	$	—
Owner-Occupied		87,243		3,405		—		1,295		91,943		3,500		—
Multifamily residential		246,318		3,921		—		—		250,239		—		—
Nonresidential properties		203,514		3		—		3,708		207,225		4,201		—
Construction and land		99,309		—		—		—		99,309		1,118		—
Nonmortgage loans:
Business		10,877		—		—		—		10,877		—		—
Consumer		1,231		—		—		—		1,231		—		—
Total	$	948,816	$	11,195	$	—	$	6,085	$	966,096	$	10,568	$	—

Schedule of Composition of Allowance for Loan Losses and Related Recorded Investment

The following schedules detail the composition of the allowance for loan losses and the related recorded investment in loans as of September 30, 2020 and 2019, and December 31, 2019:

	For the Nine Months Ended September 30, 2020
	Mortgage Loans												Nonmortgage Loans					Total
	1-4 Family Investor Owned			1-4 Family Owner Occupied		Multifamily		Nonresidential		Construction and Land			Business		Consumer			For the Period
Allowance for loan losses:
Balance, beginning of period	$	3,503		$	1,067	$	3,865	$	1,849	$	1,782		$	254	$	9		$	12,329
Provision charged to expense		353			134		1,024		330		(63	)		182		77			2,037
Losses charged-off		—			—		—		—		—					(6	)		(6	)
Recoveries		—			—		—		4		—			17		—			21
Balance, end of period	$	3,856		$	1,201	$	4,889	$	2,183	$	1,719		$	453	$	80		$	14,381
Ending balance: individually evaluated for impairment	$	121		$	137	$	—	$	37	$	—		$	—	$	—		$	295
Ending balance: collectively evaluated for impairment		3,735			1,064		4,889		2,146		1,719			453		80			14,086
Total	$	3,856		$	1,201	$	4,889	$	2,183	$	1,719		$	453	$	80		$	14,381
Loans:
Ending balance: individually evaluated for impairment	$	6,412		$	5,442	$	210	$	5,245	$	—		$	—	$	—		$	17,309
Ending balance: collectively evaluated for impairment		314,026			87,898		284,565		212,526		99,721			96,700		9,806			1,105,242
Total	$	320,438		$	93,340	$	284,775	$	217,771	$	99,721		$	96,700	$	9,806		$	1,122,551

	For the Three Months Ended September 30, 2020
	Mortgage Loans												Nonmortgage Loans					Total
	1-4 Family Investor Owned			1-4 Family Owner Occupied		Multifamily		Nonresidential		Construction and Land			Business		Consumer			For the Period
Allowance for loan losses:
Balance, beginning of period	$	3,857		$	1,194	$	4,741	$	2,085	$	1,670		$	204	$	10		$	13,761
Provision charged to expense		(1	)		7		148		98		49			245		74			620
Losses charged-off		—			—		—		—		—			—		(4	)		(4	)
Recoveries		—			—		—		—		—			4		—			4
Balance, end of period	$	3,856		$	1,201	$	4,889	$	2,183	$	1,719		$	453	$	80		$	14,381

Note 5.Loans Receivable and Allowance for Loan Losses (Continued)

	For the Nine Months Ended September 30, 2019
	Mortgage Loans														Nonmortgage Loans									Total
	1-4 Family Investor Owned			1-4 Family Owner Occupied			Multifamily			Nonresidential			Construction and Land		Business			Consumer			Unallocated			For the Period
Allowance for loan losses:
Balance, beginning of period	$	3,799		$	1,208		$	3,829		$	1,925		$	1,631	$	260		$	7		$	—		$	12,659
Provision charged to expense		(297	)		(139	)		(86	)		(222	)		217		749			(1	)		(58	)		163
Losses charged-off		—			—			—			—			—		(782	)		—			—			(782	)
Recoveries		23			—			—			7			—		30			2			58			120
Balance, end of period	$	3,525		$	1,069		$	3,743		$	1,710		$	1,848	$	257		$	8		$	—		$	12,160
Ending balance: individually evaluated for impairment	$	266		$	158		$	—		$	32		$	—	$	33		$	—		$	—		$	489
Ending balance: collectively evaluated for impairment		3,259			911			3,743			1,678			1,848		224			8			—			11,671
Total	$	3,525		$	1,069		$	3,743		$	1,710		$	1,848	$	257		$	8		$	—		$	12,160
Loans:
Ending balance: individually evaluated for impairment	$	7,011		$	5,636		$	—		$	5,103		$	1,303	$	35		$	—		$	—		$	19,088
Ending balance: collectively evaluated for impairment		302,054			85,207			244,644			190,849			104,821		11,005			1,252			—			939,832
Total	$	309,065		$	90,843		$	244,644		$	195,952		$	106,124	$	11,040		$	1,252		$	—		$	958,920

	For the Three Months Ended September 30, 2019
	Mortgage Loans														Nonmortgage Loans									Total
	1-4 Family Investor Owned			1-4 Family Owner Occupied			Multifamily			Nonresidential			Construction and Land		Business			Consumer			Unallocated			For the Period
Allowance for loan losses:
Balance, beginning of period	$	3,574		$	1,168		$	3,713		$	1,928		$	1,533	$	533		$	11		$	58		$	12,518
Provision charged to expense		(49	)		(99	)		30			(220	)		315		98			(3	)		(58	)		14
Losses charged-off		—			—			—			—			—		(380	)		—			—			(380	)
Recoveries		—			—			—			2			—		6			—			—			8
Balance, end of period	$	3,525		$	1,069		$	3,743		$	1,710		$	1,848	$	257		$	8		$	—		$	12,160

Note 5.Loans Receivable and Allowance for Loan Losses (Continued)

	For the Year Ended December 31, 2019
	Mortgage Loans													Nonmortgage Loans					Total
	1-4 Family Investor Owned			1-4 Family Owner Occupied			Multifamily		Nonresidential			Construction and Land		Business			Consumer		For the Period
Allowance for loan losses:
Balance, beginning of year	$	3,799		$	1,208		$	3,829	$	1,925		$	1,631	$	260		$	7	$	12,659
Provision charged to expense		(311	)		(141	)		36		(85	)		151		608			—		258
Losses charged-off		(8	)		—			—		—			—		(724	)		—		(732	)
Recoveries		23			—			—		9			—		110			2		144
Balance, end of year	$	3,503		$	1,067		$	3,865	$	1,849		$	1,782	$	254		$	9	$	12,329
Ending balance: individually evaluated for impairment	$	265		$	149		$	—	$	31		$	—	$	14		$	—	$	459
Ending balance: collectively evaluated for impairment		3,238			918			3,865		1,818			1,782		240			9		11,870
Total	$	3,503		$	1,067		$	3,865	$	1,849		$	1,782	$	254		$	9	$	12,329
Loans:
Ending balance: individually evaluated for impairment	$	6,973		$	5,572		$	—	$	5,548		$	1,125	$	14		$	—	$	19,232
Ending balance: collectively evaluated for impairment		298,299			86,371			250,239		201,677			98,184		10,863			1,231		946,864
Total	$	305,272		$	91,943		$	250,239	$	207,225		$	99,309	$	10,877		$	1,231	$	966,096

Schedule of Information Relates to Impaired Loans

The following information relates to impaired loans as of and for the nine months ended September 30, 2020 and 2019 and for the year ended December 31, 2019:

	Unpaid Contractual		Recorded Investment		Recorded Investment		Total				Average		Interest Income
	Principal		With No		With		Recorded		Related		Recorded		Recognized
For the Nine Months Ended September 30, 2020	Balance		Allowance		Allowance		Investment		Allowance		Investment		on a Cash Basis
Mortgage loans:
1-4 Family residential	$	12,715	$	9,688	$	2,166	$	11,854	$	257	$	12,190	$	146
Multifamily residential		207		210		—		210		—		44		—
Nonresidential properties		5,639		4,873		372		5,245		38		5,369		54
Construction and land		—		—		—		—		—		751		—
Nonmortgage loans:
Business		—		—		—		—		—		17		—
Consumer		—		—		—		—		—		—		—
Total	$	18,561	$	14,771	$	2,538	$	17,309	$	295	$	18,371	$	200

	Unpaid Contractual		Recorded Investment		Recorded Investment		Total				Average		Interest Income
	Principal		With No		With		Recorded		Related		Recorded		Recognized
For the Nine Months Ended September 30, 2019	Balance		Allowance		Allowance		Investment		Allowance		Investment		on a Cash Basis
Mortgage loans:
1-4 Family residential	$	13,686	$	8,460	$	4,187	$	12,647	$	424	$	13,084	$	263
Multifamily residential		—		—		—		—		—		7		—
Nonresidential properties		5,211		4,724		379		5,103		32		3,676		85
Construction and land		1,615		1,303		—		1,303		—		1,238		4
Nonmortgage loans:
Business		38		—		35		35		33		232		5
Consumer		—		—		—		—		—		1		—
Total	$	20,550	$	14,487	$	4,601	$	19,088	$	489	$	18,238	$	357

	Unpaid Contractual		Recorded Investment		Recorded Investment		Total				Average		Interest Income
	Principal		With No		With		Recorded		Related		Recorded		Recognized
December 31, 2019	Balance		Allowance		Allowance		Investment		Allowance		Investment		on a Cash Basis
Mortgage loans:
1-4 Family residential	$	13,566	$	8,390	$	4,155	$	12,545	$	414	$	12,995	$	361
Multifamily residential		—		—		—		—		—		6		—
Nonresidential properties		5,640		5,173		375		5,548		31		3,988		121
Construction and land		1,465		1,125		—		1,125		—		1,219		6
Nonmortgage loans:
Business		16		—		14		14		14		195		—
Consumer		—		—		—		—		—		1		—
Total	$	20,687	$	14,688	$	4,544	$	19,232	$	459	$	18,404	$	488

Schedule of Troubled Debt Restructuring

During the nine months ended September 30, 2020, there were no loans restructured as a troubled debt restructuring and as of and for the year ended December 31, 2019, there was one loan restructured as a troubled debt restructuring.

Loans Restructured During

All TDRs with a payment default

within 12 months following the

Nine Months Ended September 30, 2020

modification

Pre-

Post-

Balance

Modification

of Loans

Number

Recorded

Number

at the Time

of Loans

Balance

of Loans

of Default

Mortgages:

1-4 Family

—

Total

—

Combination of rate, maturity, other

—

Total

—

	Loans Restructured During						All TDRs with a payment default within 12 months following the
	Year Ended December 31, 2019						modification
			Pre-		Post-				Balance
			Modification		Modification				of Loans
	Number		Recorded		Recorded		Number		at the Time
	of Loans		Balance		Balance		of Loans		of Default
Mortgages:
1-4 Family		1	$	275	$	283		—	$	—
Total		1	$	275	$	283		—	$	—
Combination of rate, maturity, other		1	$	275	$	283		—	$	—
Total		1	$	275	$	283		—	$	—