Foreclosed Assets (Tables)

12 Months Ended

Dec. 31, 2014

Analysis of the balance in foreclosed assets

The Company holds certain parcels of real estate due to completed foreclosure proceedings on defaulted loans or the closing of former branches. An analysis of the balance in OREO is as follows:

	Years Ended December 31,
	2014			2013
	(in thousands)
Balance at beginning of year	$	9,190		$	8,444
Transfers to OREO due to foreclosure		1,815			1,771
Other additions to foreclosed properties		23			0
Closed branch locations transferred to OREO		0			885
Properties sold		(3,014	)		(1,910	)
Balance at end of year	$	8,014		$	9,190

Analysis of valuation allowance on foreclosed assets

OREOs are presented net of a valuation allowance for losses. As the market values of OREOs change, adjustments are made to the recorded investment in the properties through the valuation allowance to ensure that all properties are recorded at the lower of cost or market. Properties written down in previous periods can be written back up if a current property valuation warrants the change, though never above the original cost of the property. An analysis of the valuation allowance on OREOs is as follows:

	Years Ended December 31,
	2014				2013
	(in thousands)
Balance at beginning of year		$	2,775		$	1,870
Additions and write-downs			1,056			1,250
Reductions due to sales or increases in value			(923	)		(345	)
Balance at end of year		$	2,908		$	2,775

Expenses applicable to foreclosed assets

Expenses applicable to OREOs include the following:

	Years Ended December 31,
	2014			2013
	(in thousands)
Net loss (gain) on sales of real estate	$	(184	)	$	100
Provision for losses (net write-downs)		1,056			1,245
Operating expenses, net of income*		285			217
Total Expenses	$	1,157		$	1,562

* included in other operating income and other operating expense