5. Loans, Allowance for Loan Losses and Credit Quality (Tables)

6 Months Ended

Jun. 30, 2014

Accounts, Notes, Loans and Financing Receivable, Gross, Allowance, and Net [Abstract]

Composition of net loans

The composition of net loans as of the balance sheet dates was as follows:

	June 30,			December 31,			June 30,
	2014			2013			2013
Commercial & industrial	$	64,475,384		$	55,619,285		$	57,608,840
Commercial real estate		164,302,843			156,935,803			138,664,212
Residential real estate - 1st lien		169,367,709			172,847,074			173,883,158
Residential real estate - Jr lien		44,564,026			45,687,405			45,145,675
Consumer		7,883,342			8,819,359			9,491,326
		450,593,304			439,908,926			424,793,211
Deduct (add):
Allowance for loan losses		4,876,816			4,854,915			4,522,179
Deferred net loan costs		(288,237	)		(300,429	)		(247,624	)
		4,588,579			4,554,486			4,274,555
Net Loans	$	446,004,725		$	435,354,440		$	420,518,656

Past due loans by segment

The following is an age analysis of past due loans (including non-accrual), by portfolio segment:

													90 Days or
			90 Days		Total						Non-Accrual		More
June 30, 2014	30-89 Days		or More		Past Due		Current		Total Loans		Loans		and Accruing
Commercial & industrial	$	373,363	$	605,406	$	978,769	$	63,496,615	$	64,475,384	$	1,347,748	$	102,961
Commercial real estate		1,378,654		94,609		1,473,263		162,829,580		164,302,843		1,661,324		5,313
Residential real estate - 1st lien		2,542,507		991,146		3,533,653		165,834,056		169,367,709		1,943,475		231,085
Residential real estate - Jr lien		228,014		110,451		338,465		44,225,561		44,564,026		453,304		57,241
Consumer		54,479		17,927		72,406		7,810,936		7,883,342		0		17,927
Total	$	4,577,017	$	1,819,539	$	6,396,556	$	444,196,748	$	450,593,304	$	5,405,851	$	414,527

													90 Days or
			90 Days		Total						Non-Accrual		More
December 31, 2013	30-89 Days		or More		Past Due		Current		Total Loans		Loans		and Accruing
Commercial & industrial	$	1,060,971	$	310,669	$	1,371,640	$	54,247,645	$	55,619,285	$	527,105	$	21,902
Commercial real estate		713,160		215,507		928,667		156,007,136		156,935,803		1,403,541		5,313
Residential real estate - 1st lien		5,184,457		1,655,950		6,840,407		166,006,667		172,847,074		2,203,106		817,109
Residential real estate - Jr lien		533,134		289,169		822,303		44,865,102		45,687,405		593,125		56,040
Consumer		136,922		7,784		144,706		8,674,653		8,819,359		0		7,784
Total	$	7,628,644	$	2,479,079	$	10,107,723	$	429,801,203	$	439,908,926	$	4,726,877	$	908,148

													90 Days or
			90 Days		Total						Non-Accrual		More
June 30, 2013	30-89 Days		or More		Past Due		Current		Total Loans		Loans		and Accruing
Commercial & industrial	$	572,834	$	29,329	$	602,163	$	57,006,677	$	57,608,840	$	497,287	$	0
Commercial real estate		1,251,943		213,084		1,465,027		137,199,185		138,664,212		1,165,336		45,653
Residential real estate - 1st lien		1,933,003		1,143,585		3,076,588		170,806,570		173,883,158		1,660,626		596,814
Residential real estate - Jr lien		292,954		41,068		334,022		44,811,653		45,145,675		348,815		5,951
Consumer		75,781		0		75,781		9,415,545		9,491,326		0		0
Total	$	4,126,515	$	1,427,066	$	5,553,581	$	419,239,630	$	424,793,211	$	3,672,064	$	648,418

Changes in the allowance for loan losses

The following summarizes changes in the allowance for loan losses and select loan information, by portfolio segment:

For the quarter ended June 30, 2014

							Residential			Residential
	Commercial			Commercial			Real Estate			Real Estate
	& Industrial			Real Estate			1st Lien			Jr Lien			Consumer			Unallocated		Total
Allowance for loan losses
Beginning balance	$	556,223		$	2,172,678		$	1,396,934		$	348,738		$	100,386		$	262,619	$	4,837,578
Charge-offs		(70,534	)		(30,819	)		0			0			(14,241	)		0		(115,594	)
Recoveries		2,124			0			1,725			60			15,923			0		19,832
Provision (credit)		199,603			13,879			(61,648	)		(54,184	)		(17,953	)		55,303		135,000
Ending balance	$	687,416		$	2,155,738		$	1,337,011		$	294,614		$	84,115		$	317,922	$	4,876,816

For the six months ended June 30, 2014

							Residential			Residential
	Commercial			Commercial			Real Estate			Real Estate
	& Industrial			Real Estate			1st Lien			Jr Lien			Consumer			Unallocated		Total
Allowance for loan losses
Beginning balance	$	516,382		$	2,143,398		$	1,452,184		$	366,471		$	105,279		$	271,201	$	4,854,915
Charge-offs		(87,214	)		(130,819	)		0			0			(65,769	)		0		(283,802	)
Recoveries		2,236			0			11,098			120			22,249			0		35,703
Provision (credit)		256,012			143,159			(126,271	)		(71,977	)		22,356			46,721		270,000
Ending balance	$	687,416		$	2,155,738		$	1,337,011		$	294,614		$	84,115		$	317,922	$	4,876,816
Allowance for loan losses
Evaluated for impairment
Individually	$	99,300		$	18,900		$	100,600		$	13,100		$	0		$	0	$	231,900
Collectively		588,116			2,136,838			1,236,411			281,514			84,115			317,922		4,644,916
Total	$	687,416		$	2,155,738		$	1,337,011		$	294,614		$	84,115		$	317,922	$	4,876,816
Loans evaluated for impairment
Individually	$	1,233,885		$	1,558,186		$	1,374,851		$	370,775		$	0				$	4,537,697
Collectively		63,241,499			162,744,657			167,992,858			44,193,251			7,883,342					446,055,607
Total	$	64,475,384		$	164,302,843		$	169,367,709		$	44,564,026		$	7,883,342				$	450,593,304

 For the year ended December 31, 2013

							Residential			Residential
	Commercial			Commercial			Real Estate			Real Estate
	& Industrial			Real Estate			1st Lien			Jr Lien			Consumer			Unallocated			Total
Allowance for loan losses
Beginning balance	$	428,381		$	1,536,440		$	1,563,576		$	332,556		$	138,699		$	312,428		$	4,312,080
Charge-offs		(83,344	)		(124,849	)		(56,430	)		(56,797	)		(67,009	)		0			(388,429	)
Recoveries		2,953			185,791			15,819			21,277			35,424			0			261,264
Provision (credit)		168,392			546,016			(70,781	)		69,435			(1,835	)		(41,227	)		670,000
Ending balance	$	516,382		$	2,143,398		$	1,452,184		$	366,471		$	105,279		$	271,201		$	4,854,915
Allowance for loan losses
Evaluated for impairment
Individually	$	27,500		$	147,700		$	99,700		$	76,500		$	0		$	0		$	351,400
Collectively		488,882			1,995,698			1,352,484			289,971			105,279			271,201			4,503,515
Total	$	516,382		$	2,143,398		$	1,452,184		$	366,471		$	105,279		$	271,201		$	4,854,915
Loans evaluated for impairment
Individually	$	373,696		$	1,386,477		$	1,788,793		$	559,250		$	0					$	4,108,216
Collectively		55,245,589			155,549,326			171,058,281			45,128,155			8,819,359						435,800,710
Total	$	55,619,285		$	156,935,803		$	172,847,074		$	45,687,405		$	8,819,359					$	439,908,926

For the quarter ended June 30, 2013

							Residential			Residential
	Commercial			Commercial			Real Estate			Real Estate
	& Industrial			Real Estate			1st Lien			Jr Lien		Consumer			Unallocated			Total
Allowance for loan losses
Beginning balance	$	436,389		$	1,763,037		$	1,511,139		$	386,070	$	119,032		$	277,717		$	4,493,384
Charge-offs		(1,352	)		(107,936	)		(3,052	)		0		(8,783	)		0			(121,123	)
Recoveries		792			0			3,010			60		26,056			0			29,918
Provision (credit)		79,415			42,939			16,865			28,031		(20,057	)		(27,193	)		120,000
Ending balance	$	515,244		$	1,698,040		$	1,527,962		$	414,161	$	116,248		$	250,524		$	4,522,179

For the six months ended June 30, 2013

							Residential			Residential
	Commercial			Commercial			Real Estate			Real Estate
	& Industrial			Real Estate			1st Lien			Jr Lien		Consumer			Unallocated			Total
Allowance for loan losses
Beginning balance	$	428,381		$	1,536,440		$	1,563,576		$	332,556	$	138,699		$	312,428		$	4,312,080
Charge-offs		(19,287	)		(107,936	)		(3,052	)		0		(26,009	)		0			(156,284	)
Recoveries		992			0			8,636			120		30,385			0			40,133
Provision (credit)		105,158			269,536			(41,198	)		81,485		(26,827	)		(61,904	)		326,250
Ending balance	$	515,244		$	1,698,040		$	1,527,962		$	414,161	$	116,248		$	250,524		$	4,522,179
Allowance for loan losses
Evaluated for impairment
Individually	$	0		$	29,000		$	121,700		$	91,100	$	0		$	0		$	241,800
Collectively		515,244			1,669,040			1,406,262			323,061		116,248			250,524			4,280,379
Total	$	515,244		$	1,698,040		$	1,527,962		$	414,161	$	116,248		$	250,524		$	4,522,179
Loans evaluated for impairment
Individually	$	305,425		$	1,068,160		$	1,366,685		$	348,815	$	0					$	3,089,085
Collectively		57,303,415			137,596,052			172,516,473			44,796,860		9,491,326						421,704,126
Total	$	57,608,840		$	138,664,212		$	173,883,158		$	45,145,675	$	9,491,326					$	424,793,211

Impaired loans by segment

Impaired loans, by portfolio segment, were as follows:

	As of June 30, 2014
			Unpaid				Average		Average
	Recorded		Principal		Related		Recorded		Recorded
	Investment		Balance		Allowance		Investment(1)		Investment(2)
With no related allowance recorded
Commercial & industrial	$	819,016	$	884,377	$	0	$	552,178	$	472,955
Commercial real estate		1,337,570		1,431,199		0		1,248,510		1,147,288
Residential real estate - 1st lien		832,008		905,092		0		1,042,268		1,146,323
Residential real estate - Jr lien		269,912		316,506		0		183,089		176,772
With an allowance recorded
Commercial & industrial		414,869		415,759		99,300		238,953		179,031
Commercial real estate		220,616		231,221		18,900		165,405		257,481
Residential real estate - 1st lien		542,843		579,363		100,600		394,924		408,070
Residential real estate - Jr lien		100,863		109,217		13,100		176,875		249,621
Total
Commercial & industrial	$	1,233,885	$	1,300,136	$	99,300	$	791,131	$	651,986
Commercial real estate	$	1,558,186	$	1,662,420	$	18,900	$	1,413,915	$	1,404,769
Residential real estate - 1st lien	$	1,374,851	$	1,484,455	$	100,600	$	1,437,192	$	1,554,393
Residential real estate - Jr lien	$	370,775	$	425,723	$	13,100	$	359,964	$	426,393
Total	$	4,537,697	$	4,872,734	$	231,900	$	4,002,202	$	4,037,541

(1) For the quarter ended June 30, 2014

(2) For the six months ended June 30, 2014

	As of December 31, 2013						2013
			Unpaid				Average
	Recorded		Principal		Related		Recorded
	Investment		Balance		Allowance		Investment
With no related allowance recorded
Commercial & industrial	$	314,510	$	363,618	$	0	$	339,519
Commercial real estate		944,845		1,021,143		0		1,325,504
Residential real estate - 1st lien		1,354,432		1,654,023		0		1,088,631
Residential real estate - Jr lien		164,137		228,134		0		64,606
With an allowance recorded
Commercial & industrial		59,186		59,186		27,500		11,837
Commercial real estate		441,632		446,963		147,700		272,174
Residential real estate - 1st lien		434,361		474,496		99,700		515,685
Residential real estate - Jr lien		395,113		429,167		76,500		380,855
Total
Commercial & industrial	$	373,696	$	422,804	$	27,500	$	351,356
Commercial real estate	$	1,386,477	$	1,468,106	$	147,700	$	1,597,678
Residential real estate - 1st lien	$	1,788,793	$	2,128,519	$	99,700	$	1,604,316
Residential real estate - Jr lien	$	559,250	$	657,301	$	76,500	$	445,461
Total	$	4,108,216	$	4,676,730	$	351,400	$	3,998,811

	As of June 30, 2013
			Unpaid				Average		Average
	Recorded		Principal		Related		Recorded		Recorded
	Investment		Balance		Allowance		Investment (1)		Investment (2)
With no related allowance recorded
Commercial & Industrial	$	305,425	$	348,569	$	0	$	314,456	$	354,692
Commercial real estate		971,245		1,030,645		0		1,360,330		1,494,425
Residential real estate – 1st lien		897,190		1,122,551		0		953,984		977,522
Residential real estate - Jr lien		24,591		32,254		0		20,143		18,660
With an allowance recorded
Commercial & Industrial		0		0		0		0		0
Commercial real estate		96,915		96,915		29,000		200,883		133,922
Residential real estate – 1st lien		469,495		539,218		121,700		474,361		522,028
Residential real estate - Jr lien		324,224		349,871		91,100		324,436		314,261
Total
Commercial & Industrial	$	305,425	$	348,569	$	0	$	314,456	$	354,692
Commercial real estate	$	1,068,160	$	1,127,560	$	29,000	$	1,561,213	$	1,628,347
Residential real estate – 1st lien	$	1,366,685	$	1,661,769	$	121,700	$	1,428,345	$	1,499,550
Residential real estate - Jr lien	$	348,815	$	382,125	$	91,100	$	344,579	$	332,921
Total	$	3,089,085	$	3,520,023	$	241,800	$	3,648,593	$	3,815,510

(1) For the quarter ended June 30, 2013

(2) For the six months ended June 30, 2013

Risk ratings

The risk ratings within the loan portfolio, by segment, as of the balance sheet dates were as follows:

As of June 30, 2014

					Residential		Residential
	Commercial		Commercial		Real Estate		Real Estate
	& Industrial		Real Estate		1st Lien		Jr Lien		Consumer		Total
Group A	$	60,373,539	$	155,124,213	$	166,345,054	$	43,883,107	$	7,865,415	$	433,591,328
Group B		2,730,275		3,586,566		598,381		147,531		0		7,062,753
Group C		1,371,570		5,592,064		2,424,274		533,388		17,927		9,939,223
Total	$	64,475,384	$	164,302,843	$	169,367,709	$	44,564,026	$	7,883,342	$	450,593,304

As of December 31, 2013

					Residential		Residential
	Commercial		Commercial		Real Estate		Real Estate
	& Industrial		Real Estate		1st Lien		Jr Lien		Consumer		Total
Group A	$	51,740,744	$	148,516,895	$	169,771,357	$	44,739,736	$	8,800,365	$	423,569,097
Group B		2,824,169		3,292,200		160,468		460,844		0		6,737,681
Group C		1,054,372		5,126,708		2,915,249		486,825		18,994		9,602,148
Total	$	55,619,285	$	156,935,803	$	172,847,074	$	45,687,405	$	8,819,359	$	439,908,926

As of June 30, 2013

					Residential		Residential
	Commercial		Commercial		Real Estate		Real Estate
	& Industrial		Real Estate		1st Lien		Jr Lien		Consumer		Total
Group A	$	55,985,055	$	131,939,691	$	171,245,755	$	44,215,183	$	9,489,361	$	412,875,045
Group B		567,569		2,321,844		178,847		461,445		0		3,529,705
Group C		1,056,216		4,402,677		2,458,556		469,047		1,965		8,388,461
Total	$	57,608,840	$	138,664,212	$	173,883,158	$	45,145,675	$	9,491,326	$	424,793,211

Loans modified as TDRs

TDRs, by portfolio segment, for the periods presented were as follows:

	For the quarter ended June 30, 2014					For the 6 months ended June 30, 2014
	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
Residential real estate - 1st lien	3	$	218,330	$	237,090	6	$	480,899	$	510,737

	For the year ended December 31, 2013
		Pre-		Post-
		Modification		Modification
		Outstanding		Outstanding
	Number of	Recorded		Recorded
	Contracts	Investment		Investment
Residential real estate - 1st lien	4	$	321,406	$	330,266
Residential real estate - Jr lien	1		23,425		23,425
Total	5	$	344,831	$	353,691

	For the quarter and the six months ended June 30, 2013
		Pre-		Post-
		Modification		Modification
		Outstanding		Outstanding
	Number of	Recorded		Recorded
	Contracts	Investment		Investment
Residential real estate - Jr lien	1	$	23,425	$	23,425

TDRs payment default

The TDR’s for which there was a payment default during the twelve month period ended June 30, 2014 were as follows:

	Number of	Recorded
	Contracts	Investment
Residential real estate - 1st lien	5	$	441,679