XML 29 R26.htm IDEA: XBRL DOCUMENT v2.4.0.8
Credit Quality and Related Allowance for Loan Losses (Tables)
 6 Months Ended
Jun. 30, 2013
Credit Quality and Related Allowance for Loan Losses  
Schedule of related aging categories of loans by segment

 

 

 

June 30, 2013

 

 

 

 

 

Past Due

 

Past Due 90

 

 

 

 

 

 

 

 

 

30 To 89

 

Days Or More

 

Non-

 

 

 

(In Thousands)

 

Current

 

Days

 

& Still Accruing

 

Accrual

 

Total

 

Commercial and agricultural

 

$

118,303

 

$

78

 

$

—

 

$

572

 

$

118,953

 

Real estate mortgage:

 

 

 

 

 

 

 

 

 

 

 

Residential

 

338,083

 

1,779

 

8

 

1,106

 

340,976

 

Commercial

 

292,728

 

137

 

—

 

3,664

 

296,529

 

Construction

 

15,193

 

1

 

—

 

1,165

 

16,359

 

Installment loans to individuals

 

14,753

 

352

 

—

 

—

 

15,105

 

 

 

779,060

 

$

2,347

 

$

8

 

$

6,507

 

787,922

 

Net deferred loan fees and discounts

 

(961

)

 

 

 

 

 

 

(961

)

Allowance for loan losses

 

(9,404

)

 

 

 

 

 

 

(9,404

)

Loans, net

 

$

768,695

 

 

 

 

 

 

 

$

777,557

 

 

 

 

December 31, 2012

 

 

 

 

 

Past Due

 

Past Due 90

 

 

 

 

 

 

 

 

 

30 To 89

 

Days Or More

 

Non-

 

 

 

(In Thousands)

 

Current

 

Days

 

& Still Accruing

 

Accrual

 

Total

 

Commercial and agricultural

 

$

48,322

 

$

133

 

$

—

 

$

—

 

$

48,455

 

Real estate mortgage:

 

 

 

 

 

 

 

 

 

 

 

Residential

 

245,674

 

4,888

 

351

 

1,229

 

252,142

 

Commercial

 

177,539

 

443

 

—

 

4,049

 

182,031

 

Construction

 

13,813

 

177

 

—

 

6,077

 

20,067

 

Installment loans to individuals

 

10,550

 

109

 

—

 

—

 

10,659

 

 

 

495,898

 

$

5,750

 

$

351

 

$

11,355

 

513,354

 

Net deferred loan fees and discounts

 

(1,122

)

 

 

 

 

 

 

(1,122

)

Allowance for loan losses

 

(7,617

)

 

 

 

 

 

 

(7,617

)

Loans, net

 

$

487,159

 

 

 

 

 

 

 

$

504,615

 
Schedule of components of the purchase accounting adjustments related to the purchased impaired loans acquired in the Luzerne acquisition

The table below presents the components of the purchase accounting adjustments related to the purchased impaired loans acquired in the Luzerne acquisition as of June 1, 2013:

 

(In Thousands)

 

 

 

Unpaid principal balance

 

$

1,211

 

Interest

 

572

 

Contractual cash flows

 

1,783

 

Non-accretable discount

 

(842

)

Expected cash flows

 

941

 

Accretable discount

 

(63

)

Estimated fair value

 

$

878

 
Schedule of changes in the amortizable yield for purchased credit-impaired loans

Changes in the amortizable yield for purchased credit-impaired loans were as follows for the month ended June 30, 2013:

 

(In Thousands)

 

 

 

Balance at beginning of period

 

$

63

 

Accretion

 

(4

)

Balance at end of period

 

$

59

 
Schedule of additional information regarding loans acquired and accounted

 

 

 

June 1, 2013

 

June 30, 2013

 

(In Thousands)

 

Acquired Loans with
Specific Evidence of
Deterioration in Credit
Quality (ASC 310-30)

 

Acquired Loans with
Specific Evidence of
Deterioration in Credit
Quality (ASC 310-30)

 

Outstanding balance

 

$

1,211

 

$

1,211

 

Carrying amount

 

878

 

882

 
Schedule of interest income if interest had been recorded based on the original loan agreement terms and rate of interest for non-accrual loans and interest income recognized on a cash basis for non-accrual loans

 

 

 

Three Months Ended June 30,

 

 

 

2013

 

2012

 

(In Thousands)

 

Interest Income That
Would Have Been
Recorded Based on
Original Term and Rate

 

Interest
Income
Recorded on
a Cash Basis

 

Interest Income That
Would Have Been
Recorded Based on
Original Term and Rate

 

Interest
Income
Recorded on
a Cash Basis

 

Commercial and agricultural

 

$

4

 

$

—

 

$

—

 

$

—

 

Real estate mortgage:

 

 

 

 

 

 

 

 

 

Residential

 

22

 

3

 

4

 

7

 

Commercial

 

31

 

34

 

22

 

5

 

Construction

 

40

 

14

 

105

 

25

 

 

 

$

97

 

$

51

 

$

131

 

$

37

 

 

 

 

Six Months Ended June 30,

 

 

 

2013

 

2012

 

(In Thousands)

 

Interest Income That
Would Have Been
Recorded Based on
Original Term and Rate

 

Interest
Income
Recorded on
a Cash Basis

 

Interest Income That
Would Have Been
Recorded Based on
Original Term and Rate

 

Interest
Income
Recorded on
a Cash Basis

 

Commercial and agricultural

 

$

4

 

$

—

 

$

—

 

$

—

 

Real estate mortgage:

 

 

 

 

 

 

 

 

 

Residential

 

54

 

12

 

12

 

13

 

Commercial

 

116

 

84

 

43

 

8

 

Construction

 

81

 

25

 

221

 

56

 

 

 

$

255

 

$

121

 

$

276

 

$

77

 
Schedule of recorded investment, unpaid principal balance, and related allowance of impaired loans by segment

 

 

 

June 30, 2013

 

 

 

Recorded

 

Unpaid Principal

 

Related

 

(In Thousands)

 

Investment

 

Balance

 

Allowance

 

With no related allowance recorded:

 

 

 

 

 

 

 

Commercial and agricultural

 

$

303

 

$

439

 

$

—

 

Real estate mortgage:

 

 

 

 

 

 

 

Residential

 

986

 

1,151

 

—

 

Commercial

 

1,436

 

1,436

 

—

 

Construction

 

539

 

539

 

—

 

 

 

3,264

 

3,565

 

—

 

With an allowance recorded:

 

 

 

 

 

 

 

Commercial and agricultural

 

556

 

556

 

319

 

Real estate mortgage:

 

 

 

 

 

 

 

Residential

 

892

 

1,021

 

302

 

Commercial

 

7,155

 

7,174

 

2,139

 

Construction

 

638

 

2,993

 

267

 

 

 

9,241

 

11,744

 

3,027

 

Total:

 

 

 

 

 

 

 

Commercial and agricultural

 

859

 

995

 

319

 

Real estate mortgage:

 

 

 

 

 

 

 

Residential

 

1,878

 

2,172

 

302

 

Commercial

 

8,591

 

8,610

 

2,139

 

Construction

 

1,177

 

3,532

 

267

 

 

 

$

12,505

 

$

15,309

 

$

3,027

 

 

 

 

December 31, 2012

 

 

 

Recorded

 

Unpaid Principal

 

Related

 

(In Thousands)

 

Investment

 

Balance

 

Allowance

 

With no related allowance recorded:

 

 

 

 

 

 

 

Commercial and agricultural

 

$

—

 

$

—

 

$

—

 

Real estate mortgage:

 

 

 

 

 

 

 

Residential

 

410

 

487

 

—

 

Commercial

 

324

 

324

 

—

 

Construction

 

2,894

 

4,599

 

—

 

 

 

3,628

 

5,410

 

—

 

With an allowance recorded:

 

 

 

 

 

 

 

Commercial and agricultural

 

485

 

485

 

46

 

Real estate mortgage:

 

 

 

 

 

 

 

Residential

 

1,146

 

1,255

 

237

 

Commercial

 

8,515

 

8,611

 

2,018

 

Construction

 

3,196

 

4,696

 

234

 

 

 

13,342

 

15,047

 

2,535

 

Total:

 

 

 

 

 

 

 

Commercial and agricultural

 

485

 

485

 

46

 

Real estate mortgage:

 

 

 

 

 

 

 

Residential

 

1,556

 

1,742

 

237

 

Commercial

 

8,839

 

8,935

 

2,018

 

Construction

 

6,090

 

9,295

 

234

 

 

 

$

16,970

 

$

20,457

 

$

2,535

 
Schedule of average recorded investment in impaired loans and related interest income recognized

 

 

 

Three Months Ended June 30,

 

 

 

2013

 

2012

 

(In Thousands)

 

Average
Investment in
Impaired Loans

 

Interest Income
Recognized on an
Accrual Basis on
Impaired Loans

 

Interest Income
Recognized on a
Cash Basis on
Impaired Loans

 

Average
Investment in
Impaired Loans

 

Interest Income
Recognized on an
Accrual Basis on
Impaired Loans

 

Interest Income
Recognized on a
Cash Basis on
Impaired Loans

 

Commercial and agricultural

 

$

718

 

$

7

 

$

—

 

$

—

 

$

—

 

$

—

 

Real estate mortgage:

 

 

 

 

 

 

 

 

 

 

 

 

 

Residential

 

1,679

 

9

 

6

 

1,277

 

12

 

6

 

Commercial

 

8,491

 

46

 

38

 

6,488

 

93

 

5

 

Construction

 

2,532

 

—

 

14

 

8,419

 

—

 

26

 

 

 

$

13,420

 

$

62

 

$

58

 

$

16,184

 

$

105

 

$

37

 

 

 

 

Six Months Ended June 30,

 

 

 

2013

 

2012

 

(In Thousands)

 

Average
Investment in
Impaired Loans

 

Interest Income
Recognized on an
Accrual Basis on
Impaired Loans

 

Interest Income
Recognized on a
Cash Basis on
Impaired Loans

 

Average
Investment in
Impaired Loans

 

Interest Income
Recognized on an
Accrual Basis on
Impaired Loans

 

Interest Income
Recognized on a
Cash Basis on
Impaired Loans

 

Commercial and agricultural

 

$

615

 

$

13

 

$

—

 

$

—

 

$

—

 

$

—

 

Real estate mortgage:

 

 

 

 

 

 

 

 

 

 

 

 

 

Residential

 

1,618

 

17

 

11

 

1,386

 

25

 

29

 

Commercial

 

8,598

 

93

 

84

 

6,502

 

161

 

8

 

Construction

 

3,718

 

553

 

553

 

8,861

 

—

 

56

 

 

 

$

14,549

 

$

676

 

$

648

 

$

16,749

 

$

186

 

$

93

 
Schedule of loan modifications that are considered TDRs

 

 

 

Three Months Ended June 30,

 

 

 

2013

 

2012

 

(In Thousands, Except Number of Contracts)

 

Number
of
Contracts

 

Pre-Modification
Outstanding
Recorded
Investment

 

Post-Modification
Outstanding
Recorded
Investment

 

Number
of
Contracts

 

Pre-Modification
Outstanding
Recorded
Investment

 

Post-Modification
Outstanding
Recorded
Investment

 

Real estate mortgage:

 

 

 

 

 

 

 

 

 

 

 

 

 

Residential

 

2

 

$

61

 

$

61

 

1

 

$

49

 

$

49

 

Commercial

 

—

 

—

 

—

 

—

 

—

 

—

 

Construction

 

—

 

—

 

—

 

—

 

—

 

—

 

 

 

2

 

$

61

 

$

61

 

1

 

$

49

 

$

49

 

 

 

 

Six Months Ended June 30,

 

 

 

2013

 

2012

 

(In Thousands, Except Number of Contracts)

 

Number
of
Contracts

 

Pre-Modification
Outstanding
Recorded
Investment

 

Post-Modification
Outstanding
Recorded
Investment

 

Number
of
Contracts

 

Pre-Modification
Outstanding
Recorded
Investment

 

Post-Modification
Outstanding
Recorded
Investment

 

Real estate mortgage:

 

 

 

 

 

 

 

 

 

 

 

 

 

Residential

 

2

 

$

61

 

$

61

 

2

 

$

154

 

$

154

 

Commercial

 

2

 

264

 

264

 

1

 

37

 

37

 

Construction

 

—

 

—

 

—

 

2

 

26

 

26

 

 

 

4

 

$

325

 

$

325

 

5

 

$

217

 

$

217

 
Schedule of credit quality categories

 

 

 

June 30, 2013

 

 

 

Commercial and

 

Real Estate Mortgages

 

Installment Loans

 

 

 

(In Thousands)

 

Agricultural

 

Residential

 

Commercial

 

Construction

 

to Individuals

 

Totals

 

Pass

 

$

111,182

 

$

339,476

 

$

278,576

 

$

12,790

 

$

15,105

 

$

757,129

 

Special Mention

 

7,390

 

—

 

5,349

 

—

 

—

 

12,739

 

Substandard

 

381

 

1,500

 

12,604

 

3,569

 

—

 

18,054

 

 

 

$

118,953

 

$

340,976

 

$

296,529

 

$

16,359

 

$

15,105

 

$

787,922

 

 

 

 

December 31, 2012

 

 

 

Commercial and

 

Real Estate Mortgages

 

Installment Loans

 

 

 

(In Thousands)

 

Agricultural

 

Residential

 

Commercial

 

Construction

 

to Individuals

 

Totals

 

Pass

 

$

46,805

 

$

250,161

 

$

167,463

 

$

13,944

 

$

10,659

 

$

489,032

 

Special Mention

 

1,480

 

—

 

1,630

 

—

 

—

 

3,110

 

Substandard

 

170

 

1,981

 

12,938

 

6,123

 

—

 

21,212

 

 

 

$

48,455

 

$

252,142

 

$

182,031

 

$

20,067

 

$

10,659

 

$

513,354

 
Schedule of activity in the allowance

 

 

 

Three Months Ended June 30, 2013

 

 

 

Commercial and

 

Real Estate Mortgages

 

Installment Loans

 

 

 

 

 

(In Thousands)

 

Agricultural

 

Residential

 

Commercial

 

Construction

 

to Individuals

 

Unallocated

 

Totals

 

Beginning Balance

 

$

568

 

$

2,772

 

$

3,759

 

$

814

 

$

144

 

$

773

 

$

8,830

 

Charge-offs

 

—

 

—

 

(6

)

—

 

(25

)

—

 

(31

)

Recoveries

 

11

 

4

 

5

 

—

 

10

 

—

 

30

 

Provision

 

(39

)

269

 

230

 

29

 

12

 

74

 

575

 

Ending Balance

 

$

540

 

$

3,045

 

$

3,988

 

$

843

 

$

141

 

$

847

 

$

9,404

 

 

 

 

Three Months Ended June 30, 2012

 

 

 

Commercial and

 

Real Estate Mortgages

 

Installment Loans

 

 

 

 

 

(In Thousands)

 

Agricultural

 

Residential

 

Commercial

 

Construction

 

to Individuals

 

Unallocated

 

Totals

 

Beginning Balance

 

$

396

 

$

882

 

$

3,276

 

$

2,719

 

$

175

 

$

297

 

$

7,745

 

Charge-offs

 

—

 

(11

)

(18

)

(877

)

(19

)

—

 

(925

)

Recoveries

 

5

 

1

 

1

 

1

 

10

 

—

 

18

 

Provision

 

(46

)

88

 

(95

)

296

 

3

 

354

 

600

 

Ending Balance

 

$

355

 

$

960

 

$

3,164

 

$

2,139

 

$

169

 

$

651

 

$

7,438

 

 

 

 

Six Months Ended June 30, 2013

 

 

 

Commercial and

 

Real Estate Mortgages

 

Installment Loans

 

 

 

 

 

(In Thousands)

 

Agricultural

 

Residential

 

Commercial

 

Construction

 

to Individuals

 

Unallocated

 

Totals

 

Beginning Balance

 

$

361

 

$

1,954

 

$

3,831

 

$

950

 

$

144

 

$

377

 

$

7,617

 

Charge-offs

 

—

 

(134

)

(6

)

—

 

(50

)

—

 

(190

)

Recoveries

 

13

 

5

 

6

 

850

 

28

 

—

 

902

 

Provision

 

166

 

1,220

 

157

 

(957

)

19

 

470

 

1,075

 

Ending Balance

 

$

540

 

$

3,045

 

$

3,988

 

$

843

 

$

141

 

$

847

 

$

9,404

 

 

 

 

Six Months Ended June 30, 2012

 

 

 

Commercial and

 

Real Estate Mortgages

 

Installment Loans

 

 

 

 

 

(In Thousands)

 

Agricultural

 

Residential

 

Commercial

 

Construction

 

to Individuals

 

Unallocated

 

Totals

 

Beginning Balance

 

$

418

 

$

939

 

$

2,651

 

$

2,775

 

$

190

 

$

181

 

$

7,154

 

Charge-offs

 

—

 

(11

)

(18

)

(877

)

(51

)

—

 

(957

)

Recoveries

 

6

 

3

 

2

 

4

 

26

 

—

 

41

 

Provision

 

(69

)

29

 

529

 

237

 

4

 

470

 

1,200

 

Ending Balance

 

$

355

 

$

960

 

$

3,164

 

$

2,139

 

$

169

 

$

651

 

$

7,438

 
Schedule of concentration of loan

 

 

 

June 30,

 

 

 

2013

 

2012

 

Owners of residential rental properties

 

14.71

%

13.52

%

Owners of commercial rental properties

 

14.15

%

15.25

%
Schedule of allowance for loan losses and the recorded investment in loans by portfolio segment and based on impairment method

 

 

 

June 30, 2013

 

 

 

Commercial and

 

Real Estate Mortgages

 

Installment Loans

 

 

 

 

 

(In Thousands)

 

Agricultural

 

Residential

 

Commercial

 

Construction

 

to Individuals

 

Unallocated

 

Totals

 

Allowance for Loan Losses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Ending allowance balance attributable to loans:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Individually evaluated for impairment

 

$

319

 

$

302

 

$

2,139

 

$

267

 

$

—

 

$

—

 

$

3,027

 

Collectively evaluated for impairment

 

221

 

2,743

 

1,849

 

576

 

141

 

847

 

6,377

 

Total ending allowance balance

 

$

540

 

$

3,045

 

$

3,988

 

$

843

 

$

141

 

$

847

 

$

9,404

 

Loans:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Individually evaluated for impairment

 

$

556

 

$

1,558

 

$

8,332

 

$

1,177

 

$

—

 

 

 

$

11,623

 

Loans acquired with deteriorated credit quality

 

303

 

320

 

259

 

—

 

—

 

 

 

882

 

Collectively evaluated for impairment

 

118,094

 

339,098

 

287,938

 

15,182

 

15,105

 

 

 

775,417

 

Total ending loans balance

 

$

118,953

 

$

340,976

 

$

296,529

 

$

16,359

 

$

15,105

 

 

 

$

787,922

 

 

 

 

December 31, 2012

 

 

 

Commercial and

 

Real Estate Mortgages

 

Installment Loans

 

 

 

 

 

(In Thousands)

 

Agricultural

 

Residential

 

Commercial

 

Construction

 

to Individuals

 

Unallocated

 

Totals

 

Allowance for Loan Losses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Ending allowance balance attributable to loans:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Individually evaluated for impairment

 

$

46

 

$

237

 

$

2,018

 

$

234

 

$

—

 

$

—

 

$

2,535

 

Collectively evaluated for impairment

 

315

 

1,717

 

1,813

 

716

 

144

 

377

 

5,082

 

Total ending allowance balance

 

$

361

 

$

1,954

 

$

3,831

 

$

950

 

$

144

 

$

377

 

$

7,617

 

Loans:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Individually evaluated for impairment

 

$

485

 

$

1,556

 

$

8,839

 

$

6,090

 

$

—

 

 

 

$

16,970

 

Collectively evaluated for impairment

 

47,970

 

250,586

 

173,192

 

13,977

 

10,659

 

 

 

496,384

 

Total ending loans balance

 

$

48,455

 

$

252,142

 

$

182,031

 

$

20,067

 

$

10,659

 

 

 

$

513,354