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Loans Receivable and the Allowance for Loan Losses
 9 Months Ended
Sep. 30, 2019
Loans Receivable and the Allowance for Loan Losses  
Loans Receivable and the Allowance for Loan Losses

Note 5 – Loans Receivable and the Allowance for Loan Losses -

Loans receivable at September 30, 2019 and December 31, 2018 are summarized as follows:

 

 

 

 

 

 

 

 

 

September 30,

 

December 31,

(in thousands)

    

2019

    

2018

Mortgage Loans

 

 

  

 

 

  

1-4 Family

 

$

75,225

 

$

75,185

Multifamily

 

 

3,600

 

 

4,117

Commercial real estate

 

 

1,131

 

 

1,175

Consumer Loans

 

 

207

 

 

211

 

 

 

80,163

 

 

80,688

Plus (Less):

 

 

  

 

 

  

Unamortized Loan Fees/Costs

 

 

1,207

 

 

1,234

Allowance for Loan Losses

 

 

(850)

 

 

(850)

Net Loans Receivable

 

$

80,520

 

$

81,072

 

The performing mortgage loans are pledged, under a blanket lien, as collateral securing advances from the FHLB at September 30, 2019 and December 31, 2018.

Management segregates the loan portfolio into portfolio segments which is defined as the level at which the Company develops and documents a systematic method for determining its allowance for loan losses. The portfolio segments are segregated based on loan types and the underlying risk factors present in each loan type. Such risk factors are periodically reviewed by management and revised as deemed appropriate. The following tables set forth, as of September 30, 2019 and December 31, 2018, the balance of the allowance for loan losses by portfolio segment, disaggregated by impairment methodology, which is then further segregated by amounts evaluated for impairment collectively and individually. The allowance for loan losses allocated to each portfolio segment is not necessarily indicative of future losses in any particular portfolio segment and does not restrict the use of the allowance to absorb losses in other portfolio segments.

Allowance for Loan Losses and Recorded Investment in Loans Receivable
September 30, 2019 (in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Mortgage-

 

 

 

 

 

 

 

 

Mortgage-

 

Mortgage-

 

Commercial

 

 

 

 

 

 

 

    

1-4 Family

    

Multifamily

    

Real Estate

    

Consumer

    

Total

Allowance for Loan Losses:

 

 

 

 

 

  

 

 

  

 

 

  

 

 

  

Beginning Balance

 

$

807

 

$

31

 

$

12

 

$

 —

 

$

850

Charge-Offs

 

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

 —

Recoveries

 

 

 9

 

 

 —

 

 

 —

 

 

 —

 

 

 9

Provision

 

 

(4)

 

 

(4)

 

 

(1)

 

 

 —

 

 

(9)

Ending Balance

 

$

812

 

$

27

 

$

11

 

$

 —

 

$

850

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Ending Balance:

 

 

  

 

 

  

 

 

  

 

 

  

 

 

  

Individually Evaluated for Impairment

 

$

 —

 

$

 —

 

$

 —

 

$

 —

 

$

 —

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Collectively Evaluated for Impairment

 

$

812

 

$

27

 

$

11

 

$

 —

 

$

850

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loans Receivable:

 

 

 

 

 

  

 

 

  

 

 

  

 

 

  

Ending Balance

 

$

75,225

 

$

3,600

 

$

1,131

 

$

207

 

$

80,163

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Ending Balance:

 

 

  

 

 

  

 

 

  

 

 

  

 

 

  

Individually Evaluated for Impairment

 

$

 —

 

$

 —

 

$

 —

 

$

 —

 

$

 —

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Collectively Evaluated for Impairment

 

$

75,225

 

$

3,600

 

$

1,131

 

$

207

 

$

80,163

 

The allowance for loan losses for Mortgage 1‑4 Family Loans of $812,000 includes an unallocated portion of $431,000 as of September 30, 2019.

Allowance for Loan Losses and Recorded Investment in Loans Receivable
December 31, 2018 (in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    

    

 

    

    

 

    

Mortgage-

    

    

 

    

    

 

 

 

Mortgage-

 

Mortgage-

 

Commercial

 

 

 

 

 

 

 

 

1-4 Family

 

Multifamily

 

Real Estate

 

Consumer

 

Total

Allowance for Loan Losses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Beginning Balance

 

$

813

 

$

20

 

$

17

 

$

 —

 

$

850

Charge-Offs

 

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

 —

Recoveries

 

 

11

 

 

 —

 

 

 —

 

 

 —

 

 

11

Provision

 

 

(17)

 

 

11

 

 

(5)

 

 

 —

 

 

(11)

Ending Balance

 

$

807

 

$

31

 

$

12

 

$

 —

 

$

850

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Ending Balance:

 

 

  

 

 

  

 

 

  

 

 

  

 

 

  

Individually Evaluated for Impairment

 

$

 —

 

$

 —

 

$

 —

 

$

 —

 

$

 —

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Collectively Evaluated for Impairment

 

$

807

 

$

31

 

$

12

 

$

 —

 

$

850

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loans Receivable:

 

 

 

 

 

  

 

 

  

 

 

  

 

 

  

Ending Balance

 

$

75,185

 

$

4,117

 

$

1,175

 

$

211

 

$

80,688

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Ending Balance:

 

 

  

 

 

  

 

 

  

 

 

  

 

 

  

Individually Evaluated for Impairment

 

$

 —

 

$

 —

 

$

 —

 

$

 —

 

$

 —

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Collectively Evaluated for Impairment

 

$

75,185

 

$

4,117

 

$

1,175

 

$

211

 

$

80,688

 

The allowance for loan losses for Mortgage 1‑4 Family Loans of $807,000 includes an unallocated portion of $433,000 as of December 31, 2018.

Management further disaggregates the loan portfolio segments into classes of loans, which are based on the initial measurement of the loan, risk characteristics of the loan and the method for monitoring and assessing the credit risk of the loan.

At September 30, 2019 and December 31, 2018, loan balances outstanding on non-accrual status amounted to $‑0‑ and $‑0‑, respectively. The Company considers loans more than 90 days past due and on nonaccrual as nonperforming loans.

At September 30, 2019 and December 31, 2018, the credit quality indicators (performing and nonperforming loans), disaggregated by class of loan, are as follows:

Credit Quality Indicators - Credit Risk Profile Based on Payment Activity at September 30, 2019 (in thousands)

 

 

 

 

 

 

 

 

 

 

 

    

    

 

    

Non-

    

    

 

 

 

Performing

 

Performing

 

Total

Mortgage Loans:

 

 

  

 

 

  

 

 

  

1 to 4 Family

 

$

75,225

 

$

 —

 

$

75,225

Multifamily

 

 

3,600

 

 

 —

 

 

3,600

Commercial real estate

 

 

1,131

 

 

 —

 

 

1,131

Non-Mortgage Loans:

 

 

 

 

 

  

 

 

  

Consumer

 

 

207

 

 

 —

 

 

207

Total

 

$

80,163

 

$

 —

 

$

80,163

 

Credit Quality Indicators - Credit Risk Profile Based on Payment Activity at December 31, 2018 (in thousands)

 

 

 

 

 

 

 

 

 

 

 

    

    

 

    

Non-

    

    

 

 

 

Performing

 

Performing

 

Total

Mortgage Loans:

 

 

  

 

 

  

 

 

  

1 to 4 Family

 

$

75,185

 

$

 —

 

$

75,185

Multifamily

 

 

4,117

 

 

 —

 

 

4,117

Commercial real estate

 

 

1,175

 

 

 —

 

 

1,175

Non-Mortgage Loans:

 

 

  

 

 

  

 

 

  

Consumer

 

 

211

 

 

 —

 

 

211

Total

 

$

80,688

 

$

 —

 

$

80,688

 

The following tables reflect certain information with respect to the loan portfolio delinquencies by loan class and amount as of September 30, 2019 and December 31, 2018. There were no loans over 90 days past due and still accruing as of September 30, 2019 and December 31, 2018.

Aged Analysis of Past Due Loans Receivable at September 30, 2019 (in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    

30-59

    

60-89 

    

90 Days or

    

    

 

    

    

 

    

Total

 

 

Days

 

Days

 

Greater  

 

Total

 

 

 

 

Loans

 

 

Past Due

 

Past Due

 

Past Due

 

Past Due

 

Current

 

Receivable

Mortgage Loans:

 

 

 

 

 

  

 

 

  

 

 

  

 

 

  

 

 

  

1 to 4 Family

 

$

228

 

$

 —

 

$

 —

 

$

228

 

$

74,997

 

$

75,225

Multifamily

 

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

3,600

 

 

3,600

Commercial real estate

 

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

1,131

 

 

1,131

Non-Mortgage Loans:

 

 

 

 

 

 

 

 

  

 

 

  

 

 

  

 

 

  

Consumer

 

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

207

 

 

207

Total

 

$

228

 

$

 —

 

$

 —

 

$

228

 

$

79,935

 

$

80,163

 

Aged Analysis of Past Due Loans Receivable at December 31, 2018 (in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    

30-59

    

60-89 

    

90 Days or

    

    

 

    

    

 

    

Total

 

 

Days

 

Days

 

Greater  

 

Total

 

 

 

 

Loans

 

 

Past Due

 

Past Due

 

Past Due

 

Past Due

 

Current

 

Receivable

Mortgage Loans:

 

 

  

 

 

  

 

 

  

 

 

  

 

 

  

 

 

  

1 to 4 Family

 

$

227

 

$

171

 

$

 —

 

$

398

 

$

74,787

 

$

75,185

Multifamily

 

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

4,117

 

 

4,117

Commercial real estate

 

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

1,175

 

 

1,175

Non-Mortgage Loans:

 

 

  

 

 

  

 

 

  

 

 

  

 

 

  

 

 

  

Consumer

 

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

211

 

 

211

Total

 

$

227

 

$

171

 

$

 —

 

$

398

 

$

80,290

 

$

80,688

 

The following is a summary of information pertaining to impaired loans as of September 30, 2019 and December 31, 2018.

Impaired Loans

September 30, 2019

(in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    

    

 

    

Unpaid

    

    

 

    

Average

    

Interest

 

 

Recorded

 

Principal

 

Related

 

Recorded

 

Income

 

 

Investment

 

Balance

 

Allowance

 

Investment

 

Recognized

Mortgage Loans

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1-4 Family

 

$

 —

 

$

 —

 

$

 —

 

$

 —

 

$

 —

 

Impaired Loans

December 31, 2018

(in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    

    

 

    

Unpaid

    

    

 

    

Average

    

Interest

 

 

Recorded

 

Principal

 

Related

 

Recorded

 

Income

 

 

Investment

 

Balance

 

Allowance

 

Investment

 

Recognized

Mortgage Loans

 

 

  

 

 

  

 

 

  

 

 

  

 

 

  

1-4 Family

 

$

 —

 

$

 —

 

$

 —

 

$

197

 

$

98

 

The Company seeks to assist customers that are experiencing financial difficulty by renegotiating loans within lending regulations and guidelines. Once modified in a trouble debt restructuring, a loan is generally considered impaired until its contractual maturity. At the time of the restructuring, the loan is evaluated for an asset-specific allowance for credit losses. The Company continues to specifically reevaluate the loan in subsequent periods, regardless of the borrower’s performance under the modified terms. If a borrower subsequently defaults on the loan after it is restructured, the Company provides an allowance for credit losses for the amount of the loan that exceeds the value of the related collateral.

The Company had no troubled debt restructurings as of September 30, 2019 and December 31, 2018 or any that defaulted subsequent to the restructuring through the date the financial statements were issued.