Loans and Allowance for Loan Losses (Tables)

6 Months Ended

Jun. 30, 2016

Loans and Allowance For Loan Losses [Abstract]

Categories of loans include:

	June 30,		December 31,
	2016		2015
	(In thousands)

Commercial loans	$	86,539	$	67,247
Commercial real estate		168,517		163,459
Residential real estate		78,307		81,498
Installment loans		15,459		17,459

Total gross loans		348,822		329,663

Less allowance for loan losses		(2,465)		(2,437)

Total loans	$	346,357	$	327,226

Allowance for Loan Losses and Recorded Investment in Loans

Risk is mitigated by the fact that the loans are of smaller individual amounts and spread over a large number of borrowers.

Allowance for Loan Losses and Recorded Investment in Loans

As of and for the three and six month period ended June 30, 2016

	Commercial		Commercial Real Estate		Residential		Installment		Unallocated		Total
			(In thousands)
Allowance for loan losses:
Balance, April 1, 2016	$	192	$	702	$	166	$	236	$	1,079	$	2,375
Provision charged to expense		231		(278)		(15)		9		158		105

Losses charged off		—		—		—		(120)		—		(120)
Recoveries		74		3		12		16		—		105

Balance, June 30, 2016	$	497	$	427	$	163	$	141	$	1,237	$	2,465

Balance, January 1, 2016	$	184	$	597	$	170	$	113	$	1,373	$	2,437
Provision charged to expense		238		(177)		72		179		(136)		176
Losses charged off		(2)		—		(91)		(191)		—		(284)
Recoveries		77		7		12		40		—		136

Balance, June 30, 2016	$	497	$	427	$	163	$	141	$	1,237	$	2,465
Ending balance: individually evaluated for impairment	$	—	$	278	$	—	$	—	$	—	$	278
Ending balance: collectively evaluated for impairment	$	497	$	149	$	163	$	141	$	1,237	$	2,187

Loans:
Ending balance: individually evaluated for impairment	$	1	$	1,368	$	—	$	—	$	—	$	1,369
Ending balance: collectively evaluated for impairment	$	86,538	$	167,149	$	78,307	$	15,459	$	—	$	348,822

Allowance for Loan Losses and Recorded Investment in Loans

As of and for the three and six month period ended June 30, 2015

	Commercial		Commercial Real Estate		Residential		Installment		Unallocated		Total
	(In thousands)
Allowance for loan losses:

Balance, April 1, 2015	$	238	$	1,119	$	171	$	91	$	887	$	2,506
Provision charged to expense		(11)		(351)		79		71		357		145
Losses charged off		––		––		(40)		—		––		(40)
Recoveries		7		3		66		10		––		86

Balance, June 30, 2015	$	234	$	771	$	276	$	172	$	1,244	$	2,697

Balance, January 1, 2015	$	254	$	1,116	$	147	$	92	$	791	$	2,400
Provision charged to expense		(46)		(352)		140		66		453		261
Losses charged off		––		––		(93)		—		––		(93)
Recoveries		26		7		82		14		––		129

Balance, June 30, 2015	$	234	$	771	$	276	$	172	$	1,244	$	2,697

Ending balance: individually evaluated for impairment	$	86	$	377	$	—	$	—	$	—	$	463

Ending balance: collectively evaluated for impairment	$	148	$	394	$	276	$	172	$	1,244	$	2,234

Loans:

Ending balance: individually evaluated for impairment	$	98	$	1,947	$	—	$	—	$	—	$	2,045

Ending balance: collectively evaluated for impairment	$	57,380	$	150,317	$	82,857	$	19,323	$	—	$	309,877

Allowance for Loan Losses and Recorded Investment in Loans

As of December 31, 2015

	Commercial		Commercial Real Estate		Residential		Installment		Unallocated		Total
	(In thousands)
Allowance for loan losses:

Ending balance: individually evaluated for impairment	$	9	$	172	$	––	$	––	$	––	$	181

Ending balance: collectively evaluated for impairment	$	175	$	425	$	170	$	113	$	1,373	$	2,256

Loans:

Ending balance: individually evaluated for impairment	$	57	$	1,273	$	––	$	80	$	––	$	1,410

Ending balance: collectively evaluated for impairment	$	67,190	$	162,186	$	81,498	$	17,379	$	––	$	328,253

Portfolio Quality Indicators

The following tables show the portfolio quality indicators.

	June 30, 2016
Loan Class	Commercial		Commercial Real Estate		Residential		Installment		Total
	(In thousands)

Pass Grade	$	86,436	$	163,724	$	78,307	$	15,459	$	343,926
Special Mention		102		673		—		—		775
Substandard		1		4,120		—		—		4,121
Doubtful		—		—		—		—		—

	$	86,539	$	168,517	$	78,307	$	15,459	$	348,822

	December 31, 2015
Loan Class	Commercial		Commercial Real Estate		Residential		Installment		Total
	(In thousands)

Pass Grade	$	67,150	$	158,362	$	81,498	$	17,363	$	324,373
Special Mention		39		996		—		—		1,035
Substandard		58		4,101		—		96		4,255
Doubtful		—		—		—		—		—

	$	67,247	$	163,459	$	81,498	$	17,459	$	329,663

Loan Portfolio Aging Analysis

The Company evaluates the loan risk grading system definitions and allowance for loan losses methodology on an ongoing basis. No significant changes were made to either during the past year to date period.

Loan Portfolio Aging Analysis

As of June 30, 2016

	30-59 Days Past Due and Accruing		60-89 Days Past Due and Accruing		Greater Than 90 Days and Accruing		Non Accrual		Total Past Due and Non Accrual		Current		Total Loans Receivable
	(In thousands)
Commercial	$	47	$	86	$	—	$	2	$	135	$	86,404	$	86,539
Commercial real estate		199		—		—		474		673		167,844		168,517
Residential		780		354		—		707		1,841		76,466		78,307
Installment		112		2		—		45		159		15,300		15,459
Total	$	1,138	$	442	$	—	$	1,228	$	2,808	$	346,014	$	348,822

Loan Portfolio Aging Analysis

As of December 31, 2015

	30-59 Days Past Due and Accruing		60-89 Days Past Due and Accruing		Greater Than 90 Days and Accruing		Non Accrual		Total Past Due and Non Accrual		Current		Total Loans Receivable
	(In thousands)
Commercial	$	141	$	—	$	—	$	63	$	204	$	67,043	$	67,247
Commercial real estate		319		—		132		250		701		162,758		163,459
Residential		737		500		—		599		1,836		79,662		81,498
Installment		220		71		—		132		423		17,036		17,459
Total	$	1,417	$	571	$	132	$	1,044	$	3,164	$	326,499	$	329,663

Impaired Loans

Impaired Loans

	As of June 30, 2016						For the three months ended June 30, 2016				For the six months ended June 30, 2016
	Recorded Balance		Unpaid Principal Balance		Specific Allowance		Average Investment in Impaired Loans		Interest Income Recognized		Average Investment in Impaired Loans		Interest Income Recognized

	(In thousands)
Loans without a specific valuation allowance:
Commercial	$	1	$	1	$	—	$	1	$	—	$	1	$	—
Commercial real estate		471		471		—		875		9		884		17
Residential		—		—		—		—		—		—		—
Installment		—		—		—		—		—		—		—
		472		472		—		876		9		885		17
Loans with a specific valuation allowance:
Commercial		—		—		—		—		—		—		—
Commercial real estate		897		897		278		1,098		6		1,102		17
Residential		—		—		—		—		—		—		—
Installment		—		—		—		—		2		—		2
		897		897		278		1,098		8		1,102		19

Total:
Commercial	$	1	$	1	$	—	$	1	$	—	$	1	$	—
Commercial real estate	$	1,368	$	1,368	$	278	$	1,973	$	15	$	1,986	$	34
Residential	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Installment	$	—	$	—	$	—	$	—	$	2	$	—	$	2

Impaired Loans

	As of December 31, 2015						For the three months ended June 30, 2015				For the six months ended June 30, 2015
	Recorded Balance		Unpaid Principal Balance		Specific Allowance		Average Investment in Impaired Loans		Interest Income Recognized		Average Investment in Impaired Loans		Interest Income Recognized

	(In thousands)
Loans without a specific valuation allowance:
Commercial	$	44	$	74	$	—	$	—	$	—	$	—	$	—
Commercial real estate		464		464		—		1,493		17		1,500		26
Residential		80		203		—		—		—		—		—
Installment		—		—		—		—		—		—		—
		588		741		—		1,493		17		1,500		26
Loans with a specific valuation allowance:
Commercial		13		49		9		100		2		102		4
Commercial real estate		809		961		172		928		3		945		18
Residential		—		—		—		—		—		—		—
Installment		—		—		—		—		—		—		—
		822		1,010		181		1,028		5		1,047		22

Total:
Commercial	$	57	$	123	$	9	$	100	$	2	$	102	$	4
Commercial real estate	$	1,273	$	1,425	$	172	$	2,421	$	20	$	2,445	$	44
Residential	$	80	$	203	$	—	$	—	$	—	$	—	$	—
Installment	$	—	$	—	$	—	$	—	$	—	$	—	$	—

Troubled Debt Restructurings on Financing Receivables

In conjunction with the restructuring there were no amounts charged-off.

	Three Months ended June 30, 2016
	Number of Contracts		Pre- Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment
	(In thousands)

Commercial		—	$	—	$	—
Commercial real estate		—		—		—
Residential		—		—		—
Installment		—		—		—

Three Months Ended June 30, 2016

Interest
Only

Term

Combination

Total
Modification

(In thousands)

Commercial

—

Commercial real estate

—

Residential

—

Consumer

—

	Six Months ended June 30, 2016
	Number of Contracts		Pre- Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment
	(In thousands)

Commercial		—	$	—	$	—
Commercial real estate		2		85		85
Residential		—		—		—
Installment		—		—		—

	Six Months Ended June 30, 2016
	Interest Only		Term		Combination		Total Modification
			(In thousands)

Commercial	$	—	$	—	$	—	$	—
Commercial real estate		—		85		—		85
Residential		—		—		—		—
Consumer		—		—		—		—