LOANS (Tables)

6 Months Ended

Jun. 30, 2020

Summary of balances of loans

	June 30,		December 31,
	2020		2019
	(in thousands)
Residential real estate:
One- to four-family	$	977,336	$	935,794
Second mortgages and equity lines of credit		152,709		155,716
Residential real estate construction		20,655		14,055
		1,150,700		1,105,565
Commercial:
Commercial real estate		1,318,051		1,169,923
Commercial construction		194,549		153,907
Commercial and industrial		456,192		306,282
Total commercial loans		1,968,792		1,630,112
Consumer loans:
Auto		345,212		424,592
Personal		9,318		11,289
Total consumer loans		354,530		435,881
Total loans		3,474,022		3,171,558
Allowance for loan losses		(36,107)		(24,060)
Loans, net	$	3,437,915	$	3,147,498

Schedule of activity in allowance for loan losses and allocation of allowance to loan segments

The following is the activity in the allowance for loan losses for the three and six months ended June 30, 2020 and 2019:

	Residential		Commercial		Commercial		Commercial
	Real Estate		Real Estate		Construction		and Industrial		Consumer		Unallocated		Total
	(in thousands)
Balance at March 31, 2019	$	3,120	$	10,351	$	2,670	$	2,819	$	1,109	$	1,213	$	21,282
Provision (credit) for loan losses		(115)		749		257		442		71		346		1,750
Charge-offs		(116)		—		—		(750)		(178)		—		(1,044)
Recoveries		211		—		—		1		61		—		273
Balance at June 30, 2019	$	3,100	$	11,100	$	2,927	$	2,512	$	1,063	$	1,559	$	22,261
Balance at March 31, 2020	$	3,177	$	14,642	$	2,522	$	2,740	$	1,484	$	1,824	$	26,389
Provision (credit) for loan losses		2,598		3,747		693		1,102		808		1,056		10,004
Charge-offs		(52)		—		—		(280)		(126)		—		(458)
Recoveries		134		—		—		—		38		—		172
Balance at June 30, 2020	$	5,857	$	18,389	$	3,215	$	3,562	$	2,204	$	2,880	$	36,107

	Residential		Commercial		Commercial		Commercial
	Real Estate		Real Estate		Construction		and Industrial		Consumer		Unallocated		Total
	(in thousands)
Balance at December 31, 2018	$	3,239	$	10,059	$	2,707	$	2,286	$	1,154	$	1,210	$	20,655
Provision (credit) for loan losses		(227)		1,036		220		1,001		228		349		2,607
Charge-offs		(136)		—		—		(790)		(444)		—		(1,370)
Recoveries		224		5		—		15		125		—		369
Balance at June 30, 2019	$	3,100	$	11,100	$	2,927	$	2,512	$	1,063	$	1,559	$	22,261
Balance at December 31, 2019	$	3,178	$	12,875	$	2,526	$	2,977	$	1,010	$	1,494	$	24,060
Provision (credit) for loan losses		2,549		6,687		689		943		1,499		1,386		13,753
Charge-offs		(52)		(1,174)		—		(577)		(379)		—		(2,182)
Recoveries		182		1		—		219		74		—		476
Balance at June 30, 2020	$	5,857	$	18,389	$	3,215	$	3,562	$	2,204	$	2,880	$	36,107

Allocation of the allowance to loan segments at June 30, 2020 and December 31, 2019 follows:

	Residential		Commercial		Commercial		Commercial
	Real Estate		Real Estate		Construction		and Industrial		Consumer		Unallocated		Total
	(in thousands)
June 30, 2020:
Loans:
Impaired loans	$	25,022	$	3,631	$	10,971	$	10,578	$	—			$	50,202
Non-impaired loans		1,125,678		1,314,420		183,578		445,614		354,530				3,423,820
Total loans	$	1,150,700	$	1,318,051	$	194,549	$	456,192	$	354,530			$	3,474,022
Allowance for loan losses:
Impaired loans	$	1,066	$	—	$	—	$	457	$	—	$	—	$	1,523
Non-impaired loans		4,791		18,389		3,215		3,105		2,204		2,880		34,584
Total allowance for loan losses	$	5,857	$	18,389	$	3,215	$	3,562	$	2,204	$	2,880	$	36,107
December 31, 2019:
Loans:
Impaired loans	$	27,275	$	530	$	11,244	$	5,831	$	—			$	44,880
Non-impaired loans		1,078,290		1,169,393		142,663		300,451		435,881				3,126,678
Total loans	$	1,105,565	$	1,169,923	$	153,907	$	306,282	$	435,881			$	3,171,558
Allowance for loan losses:
Impaired loans	$	985	$	—	$	—	$	176	$	—	$	—	$	1,161
Non-impaired loans		2,193		12,875		2,526		2,801		1,010		1,494		22,899
Total allowance for loan losses	$	3,178	$	12,875	$	2,526	$	2,977	$	1,010	$	1,494	$	24,060

Summary of past due and non-accrual loans

					90 Days
	30-59 Days		60-89 Days		or More		Total		Loans on
	Past Due		Past Due		Past Due		Past Due		Non-accrual
	(in thousands)
June 30, 2020
Residential real estate:
One- to four-family	$	1,279	$	3,276	$	5,396	$	9,951	$	10,595
Second mortgages and equity lines of credit		183		319		556		1,058		1,095
Commercial real estate		—		2,667		3,631		6,298		3,631
Commercial construction		—		—		10,939		10,939		10,939
Commercial and industrial		1,278		799		1,879		3,956		10,572
Consumer:
Auto		1,175		671		942		2,788		1,179
Personal		5		42		13		60		53
Total	$	3,920	$	7,774	$	23,356	$	35,050	$	38,064
December 31, 2019
Residential real estate:
One- to four-family	$	9,364	$	5,622	$	5,668	$	20,654	$	10,610
Second mortgages and equity lines of credit		418		77		760		1,255		1,561
Commercial real estate		261		4,730		191		5,182		530
Commercial construction		—		—		1,960		1,960		11,244
Commercial and industrial		2,000		722		3,133		5,855		5,831
Consumer:
Auto		3,180		456		457		4,093		529
Personal		69		16		13		98		16
Total	$	15,292	$	11,623	$	12,182	$	39,097	$	30,321

Schedule of information pertaining to impaired loans

The following information pertains to impaired loans:

	June 30, 2020						December 31, 2019
			Unpaid						Unpaid
	Recorded		Principal		Related		Recorded		Principal		Related
	Investment		Balance		Allowance		Investment		Balance		Allowance
	(in thousands)
Impaired loans without a specific reserve:
Residential real estate	$	10,725	$	11,706	$	—	$	11,610	$	12,140	$	—
Commercial real estate		3,631		4,770		—		530		530		—
Commercial construction		10,971		11,244		—		11,244		11,244		—
Commercial and industrial		4,809		6,678		—		5,505		6,901		—
Total		30,136		34,398		—		28,889		30,815		—
Impaired loans with a specific reserve:
Residential real estate		14,297		14,634		1,066		15,665		16,218		985
Commercial and industrial		5,769		5,769		457		326		326		176
Total		20,066		20,403		1,523		15,991		16,544		1,161
Total impaired loans	$	50,202	$	54,801	$	1,523	$	44,880	$	47,359	$	1,161

	Three Months Ended June 30,
	2020						2019
					Interest						Interest
	Average		Interest		Income		Average		Interest		Income
	Recorded		Income		Recognized		Recorded		Income		Recognized
	Investment		Recognized		on Cash Basis		Investment		Recognized		on Cash Basis
	(in thousands)
Residential real estate	$	25,241	$	253	$	196	$	30,868	$	408	$	314
Commercial real estate		3,668		1		1		92		—		—
Commercial construction		10,971		—		—		—		—		—
Commercial and industrial		7,765		—		—		6,466		10		10
Total	$	47,645	$	254	$	197	$	37,426	$	418	$	324

	Six Months Ended June 30,
	2020						2019
					Interest						Interest
	Average		Interest		Income		Average		Interest		Income
	Recorded		Income		Recognized		Recorded		Income		Recognized
	Investment		Recognized		on Cash Basis		Investment		Recognized		on Cash Basis
	(in thousands)
Residential real estate	$	25,919	$	575	$	518	$	30,818	$	948	$	759
Commercial real estate		2,622		1		1		895		—		—
Commercial construction		11,062		—		—		—		—		—
Commercial and industrial		7,120		7		7		5,586		23		23
Total	$	46,723	$	583	$	526	$	37,299	$	971	$	782

Schedule of loans by risk rating

	June 30, 2020						December 31, 2019
	Commercial		Commercial		Commercial		Commercial		Commercial		Commercial
	Real Estate		Construction		and Industrial		Real Estate		Construction		and Industrial
	(in thousands)
Loans rated 1 - 6	$	1,313,255	$	168,974	$	444,708	$	1,163,342	$	127,962	$	294,507
Loans rated 7		258		14,636		1,073		4,539		14,701		6,117
Loans rated 8		524		10,939		8,397		530		11,244		3,223
Loans rated 9		3,107		—		2,014		—		—		2,435
Loans rated 10		—		—		—		—		—		—
Loans not rated		907		—		—		1,512		—		—
	$	1,318,051	$	194,549	$	456,192	$	1,169,923	$	153,907	$	306,282

PCI

Schedule of information pertaining to impaired loans

	June 30,			December 31,
	2020		2019
	(in thousands)
Outstanding balance	$	4,394	$	4,609
Carrying amount	$	4,169	$	4,378

Summary of activity in accretable yield for purchased credit impaired loans

	Three Months Ended June 30,				Six Months Ended June 30,
	2020		2019		2020		2019
	(in thousands)
Balance at beginning of period	$	147	$	184	$	149	$	185
Additions		—		—		—		—
Accretion		(2)		(1)		(4)		(2)
Reclassification from nonaccretable difference		—		(14)		—		(14)
Balance at end of period	$	145	$	169	$	145	$	169