4. OTHER REAL ESTATE OWNED

6 Months Ended

Jun. 30, 2014

OTHER REAL ESTATE OWNED

OTHER REAL ESTATE OWNED

The table shows the changes in other real estate owned (OREO) as of the periods indicated as follows (in thousands):

	June 30,			December 31,
	2014			2013
Balance, January 1	$	3,454		$	22,423
Loans transferred to other real estate owned		1,340			818
Premises transferred to other real estate owned		—			627
Sales of other real estate owned		(4,396	)		(17,204	)
Gain (loss) on sale or write-down of other real estate owned		107			(3,210	)
Balance, end of period	$	505		$	3,454

The following table presents the components of OREO expense (in thousands):

	Three months ended June 30,					Six months ended June 30,
	2014			2013		2014			2013
Operating expenses	$	15		$	92	$	200		$	234
Provision for unrealized losses		84			623		84			884
Net (gain) loss on sales		(15	)		275		(190	)		248
Total other real estate owned expense	$	84		$	990	$	94		$	1,366