OTHER REAL ESTATE OWNED

9 Months Ended

Sep. 30, 2016

OTHER REAL ESTATE OWNED

OTHER REAL ESTATE OWNED

NOTE 5 — OTHER REAL ESTATE OWNED

Other real estate owned is recorded in other assets on the balance sheet.  Activity in other real estate owned was as follows:

	Three months ended  September 30,				Nine months ended September 30,
	2016		2015		2016		2015
Beginning Balance	$	3,180	$	2,065	$	1,959	$	2,688
Transfer to other real estate owned		564		801		1,547		1,164
Sale — Out of other real estate owned		(1,441)		(429)		(2,841)		(1,377)
Acquisition		—		—		1,668		—
Write-down		(61)		—		(91)		(38)
Ending Balance	$	2,242	$	2,437	$	2,242	$	2,437

The value of the sale amount above is the carrying value of the property when it was sold.

Activity in the valuation account for other real estate was as follows:

	Three months ended  September 30,				Nine months ended September 30,
	2016		2015		2016		2015
Beginning Balance —	$	(234)	$	(323)	$	(217)	$	(448)
Impairments during year		(61)		—		(91)		(38)
Recovery on impairments		5		—		18		—
Reductions		—		37		—		200
Ending Balance — September 30	$	(290)	$	(286)	$	(290)	$	(286)

Expenses related to foreclosed assets for the period ending September 30 include:

	Three months ended  September 30,				Nine months ended September 30,
	2016		2015		2016		2015
Write-downs	$	61	$	—	$	91	$	38
Losses/(gains)on sales		(128)		19		(344)		25
Net loss/(gain)	$	(67)	$	19	$	(253)	$	63
Operating expenses	$	46	$	30	$	103	$	124

Foreclosed residential real estate properties included in other assets on the Consolidated Balance Sheets totaled $1,669 and $915 at September 30, 2016 and December 31, 2015, respectively. Retail mortgage loans secured by residential real estate properties for which formal foreclosure proceedings are in process according to local requirements totaled $3,161 and $2,407 at September 30, 2016 and December 31, 2015, respectively.