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Loans and Allowance for Loan Losses (Tables)
 6 Months Ended
Jun. 30, 2014
Receivables [Abstract]  
Summary of Loans
Loans are stated at the principal amount outstanding net of unearned discounts, unearned income and allowance for loan losses.  Unearned income includes deferred loan origination fees reduced by loan origination costs and is amortized to interest income over the life of the related loan using methods that approximated the effective interest rate method.  Interest on substantially all loans is credited to income based on the principal amount outstanding. A summary of loans at June 30, 2014 and December 31, 2013 follows (in thousands):

 
June 30,
2014
 
December 31,
2013
Construction and land development
$
18,945

 
$
25,321

Agricultural real estate
109,577

 
109,376

1-4 Family residential properties
181,778

 
184,158

Multifamily residential properties
53,295

 
50,174

Commercial real estate
379,245

 
357,726

Loans secured by real estate
742,840

 
726,755

Agricultural loans
55,578

 
64,055

Commercial and industrial loans
200,077

 
168,227

Consumer loans
14,052

 
14,579

All other loans
9,052

 
9,094

Gross loans
1,021,599

 
982,710

Less:
 

 
 

Net deferred loan fees, premiums and discounts
277

 
420

Allowance for loan losses
13,681

 
13,249

Net loans
$
1,007,641

 
$
969,041
Allowance for Loan Losses and Recorded Investment in Loans
following tables present the balance in the allowance for loan losses and the recorded investment in loans based on portfolio segment and impairment method for the three and six-months ended June 30, 2014 and 2013 and for the year ended December 31, 2013 (in thousands):
 
Commercial/ Commercial Real Estate
 
Agricultural/ Agricultural Real Estate
 
Residential 
Real Estate
 
Consumer
 
Unallocated
 
Total
Three months ended June 30, 2014
 
 
 
 
 
 
 
 
 
 
 
Allowance for loan losses:
 
 
 
 
 
 
 
 
 
 
 
Balance, beginning of period
$
10,581

 
$
503

 
$
760

 
$
372

 
$
1,387

 
$
13,603

Provision charged to expense
200

 
21

 
6

 
27

 
(126
)
 
128

Losses charged off
(28
)
 
—

 
(14
)
 
(60
)
 
—

 
(102
)
Recoveries
18

 
—

 
5

 
29

 
—

 
52

Balance, end of period
$
10,771

 
$
524

 
$
757

 
$
368

 
$
1,261

 
$
13,681

Ending balance:
 

 
 

 
 

 
 

 
 

 
 

Individually evaluated for impairment
$
322

 
$
—

 
$
—

 
$
—

 
$
—

 
$
322

Collectively evaluated for impairment
$
10,449

 
$
524

 
$
757

 
$
368

 
$
1,261

 
$
13,359

Three months ended June 30, 2013
 

 
 

 
 

 
 

 
 

 
 

Allowance for loan losses:
 

 
 

 
 

 
 

 
 

 
 

Balance, beginning of period
$
9,341

 
$
417

 
$
719

 
$
422

 
$
1,085

 
$
11,984

Provision charged to expense
40

 
(3
)
 
92

 
(15
)
 
138

 
252

Losses charged off
(98
)
 
—

 
(19
)
 
(51
)
 
—

 
(168
)
Recoveries
21

 
—

 
1

 
41

 
—

 
63

Balance, end of period
$
9,304

 
$
414

 
$
793

 
$
397

 
$
1,223

 
$
12,131

Ending balance:
 

 
 

 
 

 
 

 
 

 
 

Individually evaluated for impairment
$
439

 
$
—

 
$
—

 
$
—

 
$
—

 
$
439

Collectively evaluated for impairment
$
8,865

 
$
414

 
$
793

 
$
397

 
$
1,223

 
$
11,692

Six months ended June 30, 2014
 
 
 
 
 
 
 
 
 
 
 
Allowance for loan losses:
 
 
 
 
 
 
 
 
 
 
 
Balance, beginning of year
$
10,646

 
$
533

 
$
771

 
$
377

 
$
922

 
$
13,249

Provision charged to expense
75

 
(10
)
 
11

 
36

 
339

 
451

Losses charged off
(32
)
 
—

 
(45
)
 
(105
)
 
—

 
(182
)
Recoveries
82

 
1

 
20

 
60

 
—

 
163

Balance, end of period
$
10,771

 
$
524

 
$
757

 
$
368

 
$
1,261

 
$
13,681

Ending balance:
 

 
 

 
 

 
 

 
 

 
 

Individually evaluated for impairment
$
322

 
$
—

 
$
—

 
$
—

 
$
—

 
$
322

Collectively evaluated for impairment
$
10,449

 
$
524

 
$
757

 
$
368

 
$
1,261

 
$
13,359

Loans:
 

 
 

 
 

 
 

 
 

 
 

Ending balance
$
657,352

 
$
164,841

 
$
185,754

 
$
14,304

 
$
—

 
$
1,022,251

Ending balance:
 

 
 

 
 

 
 

 
 

 
 

Individually evaluated for impairment
$
3,648

 
$
—

 
$
—

 
$
—

 
$
—

 
$
3,648

Collectively evaluated for impairment
$
653,704

 
$
164,841

 
$
185,754

 
$
14,304

 
$
—

 
$
1,018,603

 
 
Commercial/ Commercial Real Estate
 
Agricultural/ Agricultural Real Estate
 
Residential  Real Estate
 
Consumer
 
Unallocated
 
Total
Six months ended June 30, 2013
 
 
 
 
 
 
 
 
 
 
 
Allowance for loan losses:
 
 
 
 
 
 
 
 
 
 
 
Balance, beginning of year
$
9,301

 
$
558

 
$
726

 
$
403

 
$
788

 
$
11,776

Provision charged to expense
284

 
(145
)
 
144

 
14

 
435

 
732

Losses charged off
(367
)
 
—

 
(86
)
 
(97
)
 
—

 
(550
)
Recoveries
86

 
1

 
9

 
77

 
—

 
173

Balance, end of period
$
9,304

 
$
414

 
$
793

 
$
397

 
$
1,223

 
$
12,131

Ending balance:
 

 
 

 
 

 
 

 
 

 
 

Individually evaluated for impairment
$
439

 
$
—

 
$
—

 
$
—

 
$
—

 
$
439

Collectively evaluated for impairment
$
8,865

 
$
414

 
$
793

 
$
397

 
$
1,223

 
$
11,692

Loans:
 

 
 

 
 

 
 

 
 

 
 

Ending balance
$
564,526

 
$
147,218

 
$
188,255

 
$
15,814

 
$
—

 
$
915,813

Ending balance:
 

 
 

 
 

 
 

 
 

 
 

Individually evaluated for impairment
$
5,232

 
$
312

 
$
—

 
$
—

 
$
—

 
$
5,544

Collectively evaluated for impairment
$
559,294

 
$
146,906

 
$
188,255

 
$
15,814

 
$
—

 
$
910,269

Year ended December 31, 2013
 

 
 

 
 

 
 

 
 

 
 

Allowance for loan losses:
 

 
 

 
 

 
 

 
 

 
 

Balance, beginning of year
$
9,301

 
$
558

 
$
726

 
$
403

 
$
788

 
$
11,776

Provision charged to expense
1,861

 
(30
)
 
171

 
57

 
134

 
2,193

Losses charged off
(764
)
 
—

 
(141
)
 
(223
)
 
—

 
(1,128
)
Recoveries
248

 
5

 
15

 
140

 
—

 
408

Balance, end of year
$
10,646

 
$
533

 
$
771

 
$
377

 
$
922

 
$
13,249

Ending balance:
 

 
 

 
 

 
 

 
 

 
 

Individually evaluated for impairment
$
604

 
$
—

 
$
—

 
$
—

 
$
—

 
$
604

Collectively evaluated for impairment
$
10,042

 
$
533

 
$
771

 
$
377

 
$
922

 
$
12,645

Loans:
 

 
 

 
 

 
 

 
 

 
 

Ending balance
$
607,062

 
$
172,979

 
$
187,796

 
$
14,967

 
$
—

 
$
982,804

Ending balance:
 

 
 

 
 

 
 

 
 

 
 

Individually evaluated for impairment
$
5,145

 
$
—

 
$
—

 
$
—

 
$
—

 
$
5,145

Collectively evaluated for impairment
$
601,917

 
$
172,979

 
$
187,796

 
$
14,967

 
$
—

 
$
977,659
Credit Risk Profile of the Company's Loan Portfolio
Loans not meeting the criteria above that are analyzed individually as part of the above described process are considered pass rated loans.

The following tables present the credit risk profile of the Company’s loan portfolio based on rating category and payment activity as of June 30, 2014 and December 31, 2013 (in thousands):

 
Construction &
Land Development
 
Agricultural Real Estate
 
1-4 Family Residential
Properties
 
Multifamily Residential
Properties
 
2014
 
2013
 
2014
 
2013
 
2014
 
2013
 
2014
 
2013
Pass
$
18,101

 
$
23,839

 
$
107,840

 
$
108,262

 
$
180,594

 
$
182,593

 
$
53,295

 
$
50,174

Watch
—

 
—

 
294

 
231

 
718

 
637

 
—

 
—

Substandard
844

 
1,482

 
1,476

 
912

 
1,483

 
1,531

 
—

 
—

Doubtful
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

Total
$
18,945

 
$
25,321

 
$
109,610

 
$
109,405

 
$
182,795

 
$
184,761

 
$
53,295

 
$
50,174


 
Commercial Real Estate (Nonfarm/Nonresidential)
 
Agricultural Loans
 
Commercial & Industrial Loans
 
Consumer Loans
 
2014
 
2013
 
2014
 
2013
 
2014
 
2013
 
2014
 
2013
Pass
$
359,723

 
$
335,284

 
$
54,539

 
$
62,439

 
$
192,603

 
$
158,107

 
$
14,034

 
$
14,558

Watch
16,095

 
17,998

 
—

 
193

 
3,071

 
3,515

 
11

 
—

Substandard
2,813

 
3,717

 
1,121

 
1,496

 
4,545

 
6,731

 
7

 
21

Doubtful
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

Total
$
378,631

 
$
356,999

 
$
55,660

 
$
64,128

 
$
200,219

 
$
168,353

 
$
14,052

 
$
14,579


 
All Other Loans
 
Total Loans
 
2014
 
2013
 
2014
 
2013
Pass
$
9,044

 
$
9,084

 
$
989,773

 
$
944,340

Watch
—

 
—

 
20,189

 
22,574

Substandard
—

 
—

 
12,289

 
15,890

Doubtful
—

 
—

 
—

 
—

Total
$
9,044

 
$
9,084

 
$
1,022,251

 
$
982,804
Loan Portfolio Aging Analysis
The following table presents the Company’s loan portfolio aging analysis at June 30, 2014 and December 31, 2013 (in thousands):
 
30-59 days Past Due
 
60-89 days Past Due
 
90 Days
or More Past Due
 
Total
Past Due
 
Current
 
Total Loans Receivable
 
Total Loans > 90 days & Accruing
June 30, 2014
 
 
 
 
 
 
 
 
 
 
 
 
 
Construction and land development
$
371

 
$
—

 
$
—

 
$
371

 
$
18,574

 
$
18,945

 
$
—

Agricultural real estate
32

 
122

 
—

 
154

 
109,456

 
109,610

 
—

1-4 Family residential properties
650

 
97

 
236

 
983

 
181,812

 
182,795

 
—

Multifamily residential properties
289

 
—

 
—

 
289

 
53,006

 
53,295

 
—

Commercial real estate
598

 
465

 
—

 
1,063

 
377,568

 
378,631

 
—

Loans secured by real estate
1,940

 
684

 
236

 
2,860

 
740,416

 
743,276

 
—

Agricultural loans
181

 
8

 
—

 
189

 
55,471

 
55,660

 
—

Commercial and industrial loans
259

 
5

 
75

 
339

 
199,880

 
200,219

 
—

Consumer loans
93

 
49

 
8

 
150

 
13,902

 
14,052

 
—

All other loans
—

 
—

 
—

 
—

 
9,044

 
9,044

 
—

Total loans
$
2,473

 
$
746

 
$
319

 
$
3,538

 
$
1,018,713

 
$
1,022,251

 
$
—

December 31, 2013
 

 
 

 
 

 
 

 
 

 
 

 
 

Construction and land development
$
—

 
$
—

 
$
—

 
$
—

 
$
25,321

 
$
25,321

 
$
—

Agricultural real estate
299

 
—

 
—

 
299

 
109,106

 
109,405

 
—

1-4 Family residential properties
326

 
146

 
371

 
843

 
183,918

 
184,761

 
—

Multifamily residential properties
—

 
—

 
—

 
—

 
50,174

 
50,174

 
—

Commercial real estate
568

 
1,030

 
145

 
1,743

 
355,256

 
356,999

 
—

Loans secured by real estate
1,193

 
1,176

 
516

 
2,885

 
723,775

 
726,660

 
—

Agricultural loans
122

 
49

 
—

 
171

 
63,957

 
64,128

 
—

Commercial and industrial loans
113

 
88

 
62

 
263

 
168,090

 
168,353

 
—

Consumer loans
83

 
25

 
4

 
112

 
14,467

 
14,579

 
—

All other loans
—

 
—

 
—

 
—

 
9,084

 
9,084

 
—

Total loans
$
1,511

 
$
1,338

 
$
582

 
$
3,431

 
$
979,373

 
$
982,804

 
$
—
Impaired Loans
The following tables present impaired loans as of June 30, 2014 and December 31, 2013 (in thousands):

 
June 30, 2014
 
December 31, 2013
 
Recorded
Balance
 
Unpaid Principal Balance
 
Specific Allowance
 
Recorded
Balance
 
Unpaid Principal Balance
 
Specific Allowance
Loans with a specific allowance:
 
 
 
 
 
 
 
 
 
 
 
Construction and land development
$
844

 
$
1,695

 
$
60

 
$
614

 
$
614

 
$
76

Agricultural real estate
—

 
—

 
—

 
—

 
—

 
—

1-4 Family residential properties
178

 
178

 
1

 
—

 
—

 
—

Multifamily residential properties
—

 
—

 
—

 
—

 
—

 
—

Commercial real estate
439

 
439

 
172

 
1,096

 
1,096

 
301

Loans secured by real estate
1,461

 
2,312

 
233

 
1,710

 
1,710

 
377

Agricultural loans
—

 
—

 
—

 
—

 
—

 
—

Commercial and industrial loans
88

 
88

 
89

 
275

 
275

 
227

Consumer loans
—

 
—

 
—

 
—

 
—

 
—

All other loans
—

 
—

 
—

 
—

 
—

 
—

Total loans
$
1,549

 
$
2,400

 
$
322

 
$
1,985

 
$
1,985

 
$
604

Loans without a specific allowance:
 

 
 

 
 

 
 

 
 

 
 

Construction and land development
$
—

 
$
—

 
$
—

 
$
869

 
$
1,727

 
$
—

Agricultural real estate
36

 
43

 
—

 
105

 
113

 
—

1-4 Family residential properties
873

 
1,241

 
—

 
1,110

 
1,558

 
—

Multifamily residential properties
—

 
—

 
—

 
—

 
—

 
—

Commercial real estate
1,842

 
1,868

 
—

 
1,750

 
1,778

 
—

Loans secured by real estate
2,751

 
3,152

 
—

 
3,834

 
5,176

 
—

Agricultural loans
—

 
—

 
—

 
—

 
—

 
—

Commercial and industrial loans
499

 
810

 
—

 
613

 
946

 
—

Consumer loans
33

 
43

 
—

 
37

 
51

 
—

All other loans
—

 
—

 
—

 
—

 
—

 
—

Total loans
$
3,283

 
$
4,005

 
$
—

 
$
4,484

 
$
6,173

 
$
—

Total loans:
 

 
 

 
 

 
 

 
 

 
 

Construction and land development
$
844

 
$
1,695

 
$
60

 
$
1,483

 
$
2,341

 
$
76

Agricultural real estate
36

 
43

 
—

 
105

 
113

 
—

1-4 Family residential properties
1,051

 
1,419

 
1

 
1,110

 
1,558

 
—

Multifamily residential properties
—

 
—

 
—

 
—

 
—

 
—

Commercial real estate
2,281

 
2,307

 
172

 
2,846

 
2,874

 
301

Loans secured by real estate
4,212

 
5,464

 
233

 
5,544

 
6,886

 
377

Agricultural loans
—

 
—

 
—

 
—

 
—

 
—

Commercial and industrial loans
587

 
898

 
89

 
888

 
1,221

 
227

Consumer loans
33

 
43

 
—

 
37

 
51

 
—

All other loans
—

 
—

 
—

 
—

 
—

 
—

Total loans
$
4,832

 
$
6,405

 
$
322

 
$
6,469

 
$
8,158

 
$
604
Impaired loans by portfolio class
The following tables present average recorded investment and interest income recognized on impaired loans for the three and six-month periods ended June 30, 2014 and 2013 (in thousands):

 
For the three months ended
 
June 30, 2014
 
June 30, 2013
 
Average Investment
in Impaired Loans
 
Interest Income Recognized
 
Average Investment
in Impaired Loans
 
Interest Income Recognized
Construction and land development
$
1,112

 
$
—

 
$
1,425

 
$
—

Agricultural real estate
36

 
—

 
216

 
—

1-4 Family residential properties
1,058

 
4

 
1,283

 
1

Commercial real estate
2,293

 
1

 
2,353

 
—

Loans secured by real estate
4,499

 
5

 
5,277

 
1

Agricultural loans
—

 
—

 
229

 
—

Commercial and industrial loans
608

 
—

 
1,430

 
—

Consumer loans
35

 
—

 
57

 
1

Total loans
$
5,142

 
$
5

 
$
6,993

 
$
2


 
 
 
 
 
 
 
 
 
For the six months ended
 
June 30, 2014
 
June 30, 2013
 
Average Investment
in Impaired Loans
 
Interest Income Recognized
 
Average Investment
in Impaired Loans
 
Interest Income Recognized
Construction and land development
$
1,126

 
$
—

 
$
1,445

 
$
—

Agricultural real estate
36

 
—

 
217

 
—

1-4 Family residential properties
1,067

 
6

 
1,414

 
2

Commercial real estate
2,303

 
1

 
2,389

 
—

Loans secured by real estate
4,532

 
7

 
5,465

 
2

Agricultural loans
—

 
—

 
253

 
—

Commercial and industrial loans
627

 
—

 
1,482

 
—

Consumer loans
37

 
1

 
59

 
1

Total loans
$
5,196

 
$
8

 
$
7,259

 
$
3
Nonaccrual Loans
The following table presents the Company’s recorded balance of nonaccrual loans as June 30, 2014 and December 31, 2013 (in thousands). This table excludes purchased impaired loans and performing troubled debt restructurings.

 
June 30,
2014
 
December 31,
2013
Construction and land development
$
844

 
$
1,483

Agricultural real estate
36

 
105

1-4 Family residential properties
746

 
1,009

Commercial real estate
2,242

 
2,807

Loans secured by real estate
3,868

 
5,404

Agricultural loans
—

 
—

Commercial and industrial loans
587

 
706

Consumer loans
13

 
11

Total loans
$
4,468

 
$
6,121
Recorded Balance of Troubled Debt Restructurings
The following table presents the Company’s recorded balance of troubled debt restructurings at June 30, 2014 and December 31, 2013 (in thousands).
Troubled debt restructurings:
June 30,
2014
 
December 31,
2013
Construction and land development
$
844

 
$
1,482

1-4 Family residential properties
489

 
306

Commercial real estate
1,364

 
899

Loans secured by real estate
2,697

 
2,687

Commercial and industrial loans
292

 
487

Consumer loans
20

 
26

Total
$
3,009

 
$
3,200

Performing troubled debt restructurings:
 

 
 

1-4 Family residential properties
$
305

 
$
101

Commercial real estate
39

 
39

Loans secured by real estate
344

 
140

Commercial and industrial loans
—

 
182

Consumer loans
20

 
26

Total
$
364

 
$
348
Financing Receivables,Troubled Debt Restructurings during period [Table Text Block]
The following table presents loans modified as TDRs during the six months ended June 30, 2014 and 2013, as a result of various modified loan factors (in thousands):
 
June 30, 2014
 
June 30, 2013
 
Number of Modifications
 
Recorded Investment
 
Type of Modifications
 
Number of Modifications
 
Recorded Investment
 
Type of Modifications
1-4 Family residential properties
2

 
207

 
(c)
 
3

 
98

 
(a)(b)(c)
Commercial real estate
1

 
501

 
(b)(c)
 
—

 
—

 

Loans secured by real estate
3

 
708

 
 
 
3

 
98

 
 
Commercial and industrial loans
—

 
—

 

 
1

 
56

 
(a)(b)
Consumer Loans
—

 
—

 

 
1

 
8

 
(c)
Total
3

 
$
708

 
 
 
5

 
$
162