XML 37 R26.htm IDEA: XBRL DOCUMENT v3.10.0.1
Loans and Allowance for Loan Losses (Tables)
 9 Months Ended
Sep. 30, 2018
Receivables [Abstract]  
Composition of the Loan Portfolio

The following represents the composition of the loan portfolio for the period ending:

 

 

(Amounts in thousands)

 

 

September 30, 2018

 

 

December 31, 2017

 

 

Balance

 

 

%

 

 

Balance

 

 

%

 

Commercial

$

72,978

 

 

 

15.2

 

 

$

113,341

 

 

 

23.3

 

Commercial real estate

 

310,019

 

 

 

64.3

 

 

 

283,135

 

 

 

58.1

 

Residential real estate

 

69,870

 

 

 

14.5

 

 

 

62,071

 

 

 

12.7

 

Consumer - home equity

 

25,654

 

 

 

5.3

 

 

 

26,018

 

 

 

5.3

 

Consumer - other

 

3,393

 

 

 

0.7

 

 

 

2,925

 

 

 

0.6

 

Total loans

$

481,914

 

 

 

 

 

 

$

487,490

 

 

 

 

 

 
Certain Qualitative Factors Considered in Measuring Risk Trends

These factors include, but are not limited to, the following:

 

Factor Considered:

 

Risk Trend:

Levels of and trends in charge-offs, classifications and non-accruals

 

Stable

Trends in volume and terms

 

Stable

Changes in lending policies and procedures

 

Stable

Experience, depth and ability of management, including loan review function

 

Stable

Economic trends, including valuation of underlying collateral

 

Stable

Concentrations of credit

 

Decreasing

 
Factors Analyzed and Applied to Loans Internally Graded with Higher Credit Risk

The following factors are analyzed and applied to loans internally graded with higher credit risk in addition to the above factors for non-classified loans:

 

Factor Considered:

 

Risk Trend:

Levels and trends in classification

 

Stable

Declining trends in financial performance

 

Stable

Structure and lack of performance measures

 

Stable

Migration between risk categories

 

Stable

 
Analysis of Changes in the Allowance for Loan Losses

The following is an analysis of changes in the allowance for loan losses for the periods ended:

 

Three Months Ended

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Amounts in thousands)

 

September 30, 2018

Commercial

 

 

Commercial

real estate

 

 

Residential

real estate

 

 

Consumer -

home equity

 

 

Consumer -

other

 

 

Total

 

Balance at beginning of period

$

1,394

 

 

$

2,457

 

 

$

80

 

 

$

66

 

 

$

98

 

 

$

4,095

 

Loan charge-offs

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(49

)

 

 

(49

)

Recoveries

 

—

 

 

 

16

 

 

 

—

 

 

 

1

 

 

 

14

 

 

 

31

 

Net loan recoveries (charge-offs)

 

—

 

 

 

16

 

 

 

—

 

 

 

1

 

 

 

(35

)

 

 

(18

)

Provision charged to operations

 

(123

)

 

 

128

 

 

 

25

 

 

 

(1

)

 

 

46

 

 

 

75

 

Balance at end of period

$

1,271

 

 

$

2,601

 

 

$

105

 

 

$

66

 

 

$

109

 

 

$

4,152

 

 

 

(Amounts in thousands)

 

September 30, 2017

Commercial

 

 

Commercial

real estate

 

 

Residential

real estate

 

 

Consumer -

home equity

 

 

Consumer -

other

 

 

Total

 

Balance at beginning of period

$

1,250

 

 

$

3,313

 

 

$

113

 

 

$

60

 

 

$

94

 

 

$

4,830

 

Loan charge-offs

 

—

 

 

 

(125

)

 

 

—

 

 

 

—

 

 

 

(39

)

 

 

(164

)

Recoveries

 

—

 

 

 

—

 

 

 

—

 

 

 

3

 

 

 

8

 

 

 

11

 

Net loan recoveries (charge-offs)

 

—

 

 

 

(125

)

 

 

—

 

 

 

3

 

 

 

(31

)

 

 

(153

)

Provision charged to operations

 

(33

)

 

 

110

 

 

 

(7

)

 

 

(1

)

 

 

31

 

 

 

100

 

Balance at end of period

$

1,217

 

 

$

3,298

 

 

$

106

 

 

$

62

 

 

$

94

 

 

$

4,777

 

 

Nine Months Ended

(Amounts in thousands)

 

September 30, 2018

Commercial

 

 

Commercial

real estate

 

 

Residential

real estate

 

 

Consumer -

home equity

 

 

Consumer -

other

 

 

Total

 

Balance at beginning of period

$

1,591

 

 

$

2,702

 

 

$

117

 

 

$

70

 

 

$

98

 

 

$

4,578

 

Loan charge-offs

 

(1,163

)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(126

)

 

 

(1,289

)

Recoveries

 

—

 

 

 

166

 

 

 

1

 

 

 

5

 

 

 

41

 

 

 

213

 

Net loan recoveries (charge-offs)

 

(1,163

)

 

 

166

 

 

 

1

 

 

 

5

 

 

 

(85

)

 

 

(1,076

)

Provision charged to operations

 

843

 

 

 

(267

)

 

 

(13

)

 

 

(9

)

 

 

96

 

 

 

650

 

Balance at end of period

$

1,271

 

 

$

2,601

 

 

$

105

 

 

$

66

 

 

$

109

 

 

$

4,152

 

 

 

(Amounts in thousands)

 

September 30, 2017

Commercial

 

 

Commercial

real estate

 

 

Residential

real estate

 

 

Consumer -

home equity

 

 

Consumer -

other

 

 

Total

 

Balance at beginning of period

$

1,394

 

 

$

3,072

 

 

$

163

 

 

$

150

 

 

$

89

 

 

$

4,868

 

Loan charge-offs

 

—

 

 

 

(225

)

 

 

(13

)

 

 

—

 

 

 

(106

)

 

 

(344

)

Recoveries

 

108

 

 

 

—

 

 

 

5

 

 

 

7

 

 

 

33

 

 

 

153

 

Net loan recoveries (charge-offs)

 

108

 

 

 

(225

)

 

 

(8

)

 

 

7

 

 

 

(73

)

 

 

(191

)

Provision charged to operations

 

(285

)

 

 

451

 

 

 

(49

)

 

 

(95

)

 

 

78

 

 

 

100

 

Balance at end of period

$

1,217

 

 

$

3,298

 

 

$

106

 

 

$

62

 

 

$

94

 

 

$

4,777

 

 
Allowance for Loan Losses and the Recorded Investment in Loans

The following tables present a full breakdown by portfolio classification of the allowance for loan losses and the recorded investment in loans at September 30, 2018 and December 31, 2017:

 

 

(Amounts in thousands)

 

September 30, 2018

Commercial

 

 

Commercial

real estate

 

 

Residential

real estate

 

 

Consumer -

home equity

 

 

Consumer -

other

 

 

Total

 

Allowance for loan losses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Ending allowance balance attributable to

   loans:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Individually evaluated for impairment

$

—

 

 

$

—

 

 

$

—

 

 

$

—

 

 

$

—

 

 

$

—

 

Collectively evaluated for impairment

 

1,271

 

 

 

2,601

 

 

 

105

 

 

 

66

 

 

 

109

 

 

 

4,152

 

Total ending allowance balance

$

1,271

 

 

$

2,601

 

 

$

105

 

 

$

66

 

 

$

109

 

 

$

4,152

 

Loan Portfolio:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Individually evaluated for impairment

$

5,433

 

 

$

4,466

 

 

$

—

 

 

$

—

 

 

$

—

 

 

$

9,899

 

Collectively evaluated for impairment

 

67,545

 

 

 

305,553

 

 

 

69,870

 

 

 

25,654

 

 

 

3,393

 

 

 

472,015

 

Total ending loans balance

$

72,978

 

 

$

310,019

 

 

$

69,870

 

 

$

25,654

 

 

$

3,393

 

 

$

481,914

 

 

 

(Amounts in thousands)

 

December 31, 2017

Commercial

 

 

Commercial

real estate

 

 

Residential

real estate

 

 

Consumer -

home equity

 

 

Consumer -

other

 

 

Total

 

Allowance for loan losses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Ending allowance balance attributable to

   loans:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Individually evaluated for impairment

$

625

 

 

$

—

 

 

$

—

 

 

$

—

 

 

$

—

 

 

$

625

 

Collectively evaluated for impairment

 

966

 

 

 

2,702

 

 

 

117

 

 

 

70

 

 

 

98

 

 

 

3,953

 

Total ending allowance balance

$

1,591

 

 

$

2,702

 

 

$

117

 

 

$

70

 

 

$

98

 

 

$

4,578

 

Loan Portfolio:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Individually evaluated for impairment

$

5,581

 

 

$

4,664

 

 

$

—

 

 

$

—

 

 

$

—

 

 

$

10,245

 

Collectively evaluated for impairment

 

107,760

 

 

 

278,471

 

 

 

62,071

 

 

 

26,018

 

 

 

2,925

 

 

 

477,245

 

Total ending loans balance

$

113,341

 

 

$

283,135

 

 

$

62,071

 

 

$

26,018

 

 

$

2,925

 

 

$

487,490

 

 
Summary of Credit Quality Indicators by Internally Assigned Grades

The following table is a summary of credit quality indicators by internally assigned grades as of September 30, 2018 and December 31, 2017:

 

 

(Amounts in thousands)

 

 

Commercial

 

 

Commercial real estate

 

September 30, 2018

 

 

 

 

 

 

 

Pass

$

53,493

 

 

$

277,352

 

Special Mention

 

8,397

 

 

 

25,942

 

Substandard

 

11,088

 

 

 

6,725

 

Doubtful

 

—

 

 

 

—

 

Ending Balance

$

72,978

 

 

$

310,019

 

 

 

(Amounts in thousands)

 

 

Commercial

 

 

Commercial real estate

 

December 31, 2017

 

 

 

 

 

 

 

Pass

$

100,436

 

 

$

252,960

 

Special Mention

 

4,836

 

 

 

24,307

 

Substandard

 

8,069

 

 

 

5,868

 

Doubtful

 

—

 

 

 

—

 

Ending Balance

$

113,341

 

 

$

283,135

 

 
Summary of Consumer Credit Exposure

The following table is a summary of consumer credit exposure as of September 30, 2018 and December 31, 2017:

 

 

(Amounts in thousands)

 

 

Residential real estate

 

 

Consumer - home equity

 

 

Consumer - other

 

September 30, 2018

 

 

 

 

 

 

 

 

 

 

 

Performing

$

69,530

 

 

$

25,533

 

 

$

3,393

 

Nonperforming

 

340

 

 

 

121

 

 

 

—

 

Total

$

69,870

 

 

$

25,654

 

 

$

3,393

 

 

 

(Amounts in thousands)

 

 

Residential real estate

 

 

Consumer - home equity

 

 

Consumer - other

 

December 31, 2017

 

 

 

 

 

 

 

 

 

 

 

Performing

$

61,824

 

 

$

25,889

 

 

$

2,925

 

Nonperforming

 

247

 

 

 

129

 

 

 

—

 

Total

$

62,071

 

 

$

26,018

 

 

$

2,925

 

 
Summary of Classes of Loans on Non-Accrual Status

The following table is a summary of classes of loans on non-accrual status as of September 30, 2018 and December 31, 2017:

 

 

(Amounts in thousands)

 

 

September 30,

2018

 

 

December 31,

2017

 

Commercial

$

1,291

 

 

$

—

 

Commercial real estate

 

595

 

 

 

506

 

Residential real estate

 

340

 

 

 

247

 

Consumer:

 

 

 

 

 

 

 

Consumer - home equity

 

121

 

 

 

129

 

Consumer - other

 

—

 

 

 

—

 

Total

$

2,347

 

 

$

882

 

 
Information Related to Loans Modified in a TDR

The following presents, by class, information related to loans modified in a TDR during the period ending September 30, 2018.

 

 

(Dollar amounts in thousands)

 

 

Three Months Ended

 

 

Nine Months Ended

 

 

September 30, 2018

 

 

September 30, 2018

 

 

Number of contracts

 

 

Pre-modification recorded investment

 

 

Post-modification recorded investment

 

 

Increase in the allowance

 

 

Number of contracts

 

 

Pre-modification recorded investment

 

 

Post-modification recorded investment

 

 

Increase in the allowance

 

Commercial

 

—

 

 

$

—

 

 

$

—

 

 

$

—

 

 

 

7

 

 

$

5,373

 

 

$

4,210

 

 

$

—

 

Commercial real estate

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

Total restructured loans

 

—

 

 

$

—

 

 

$

—

 

 

$

—

 

 

$

7

 

 

$

5,373

 

 

$

4,210

 

 

$

—

 

Subsequently defaulted

 

—

 

 

 

—

 

 

 

 

 

 

 

 

 

 

 

—

 

 

 

—

 

 

 

 

 

 

 

 

 

 
Aging Analysis of the Recorded Investment of Past Due Loans

The following table is an aging analysis of the recorded investment of past due loans as of September 30, 2018 and December 31, 2017:

 

 

(Amounts in thousands)

 

 

30-59 Days Past Due

 

 

60-89 Days Past Due

 

 

90 Days Or Greater

 

 

Total Past Due

 

 

Current

 

 

Total Loans

 

 

Recorded Investment >

90 Days and Accruing

 

September 30, 2018

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial

$

28

 

 

$

—

 

 

$

1,291

 

 

$

1,319

 

 

$

71,659

 

 

$

72,978

 

 

$

—

 

Commercial real estate

 

99

 

 

 

—

 

 

 

496

 

 

 

595

 

 

 

309,424

 

 

 

310,019

 

 

 

—

 

Residential real estate

 

244

 

 

 

80

 

 

 

243

 

 

 

567

 

 

 

69,303

 

 

 

69,870

 

 

 

—

 

Consumer:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consumer - home equity

 

115

 

 

 

—

 

 

 

26

 

 

 

141

 

 

 

25,513

 

 

 

25,654

 

 

 

—

 

Consumer - other

 

15

 

 

 

—

 

 

 

—

 

 

 

15

 

 

 

3,378

 

 

 

3,393

 

 

 

—

 

Total

$

501

 

 

$

80

 

 

$

2,056

 

 

$

2,637

 

 

$

479,277

 

 

$

481,914

 

 

$

—

 

 

 

(Amounts in thousands)

 

 

30-59 Days Past Due

 

 

60-89 Days Past Due

 

 

90 Days Or Greater

 

 

Total Past Due

 

 

Current

 

 

Total Loans

 

 

Recorded Investment >

90 Days and Accruing

 

December 31, 2017

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial

$

—

 

 

$

—

 

 

$

—

 

 

$

—

 

 

$

113,341

 

 

$

113,341

 

 

$

—

 

Commercial real estate

 

173

 

 

 

12

 

 

 

390

 

 

 

575

 

 

 

282,560

 

 

 

283,135

 

 

 

—

 

Residential real estate

 

240

 

 

 

29

 

 

 

216

 

 

 

485

 

 

 

61,586

 

 

 

62,071

 

 

 

—

 

Consumer:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consumer - home equity

 

—

 

 

 

82

 

 

 

28

 

 

 

110

 

 

 

25,908

 

 

 

26,018

 

 

 

—

 

Consumer - other

 

15

 

 

 

—

 

 

 

—

 

 

 

15

 

 

 

2,910

 

 

 

2,925

 

 

 

—

 

Total

$

428

 

 

$

123

 

 

$

634

 

 

$

1,185

 

 

$

486,305

 

 

$

487,490

 

 

$

—

 

 
Recorded Investment, Unpaid Principal Balances, Average Recorded Investments and Interest Recognized on Impaired Loans, Excluding Homogenous Loans for Which Impaired Analyses are Not Necessarily Performed

The following table presents the recorded investment and unpaid principal balances for impaired loans, excluding homogenous loans for which impaired analyses are not necessarily performed, with the associated allowance amount, if applicable, at September 30, 2018 and December 31, 2017. Also presented are the average recorded investments in the impaired balances and interest income recognized after impairment for the three and nine months ended September 30, 2018 and 2017.

 

 

(Amounts in thousands)

 

 

Recorded Investment

 

 

Unpaid Principal Balance

 

 

Related Allowance

 

September 30, 2018

 

 

 

 

 

 

 

 

 

 

 

With no related allowance recorded:

 

 

 

 

 

 

 

 

 

 

 

Commercial

$

5,433

 

 

$

6,514

 

 

$

—

 

Commercial real estate

 

4,466

 

 

 

4,466

 

 

 

—

 

With an allowance recorded:

 

 

 

 

 

 

 

 

 

 

 

Commercial

 

—

 

 

 

—

 

 

 

—

 

Commercial real estate

 

—

 

 

 

—

 

 

 

—

 

Total:

 

 

 

 

 

 

 

 

 

 

 

Commercial

$

5,433

 

 

$

6,514

 

 

$

—

 

Commercial real estate

$

4,466

 

 

$

4,466

 

 

$

—

 

 

 

(Amounts in thousands)

 

 

Recorded Investment

 

 

Unpaid Principal Balance

 

 

Related Allowance

 

December 31, 2017

 

 

 

 

 

 

 

 

 

 

 

With no related allowance recorded:

 

 

 

 

 

 

 

 

 

 

 

Commercial

$

65

 

 

$

65

 

 

$

—

 

Commercial real estate

 

4,664

 

 

 

4,742

 

 

 

—

 

With an allowance recorded:

 

 

 

 

 

 

 

 

 

 

 

Commercial

 

5,516

 

 

 

5,516

 

 

 

625

 

Commercial real estate

 

—

 

 

 

—

 

 

 

—

 

Total:

 

 

 

 

 

 

 

 

 

 

 

Commercial

$

5,581

 

 

$

5,581

 

 

$

625

 

Commercial real estate

$

4,664

 

 

$

4,742

 

 

$

—

 

 

 

 

(Amounts in thousands)

 

 

Three Months Ended

 

 

Nine Months Ended

 

 

Average Recorded Investment

 

 

Interest Income Recognized

 

 

Average Recorded Investment

 

 

Interest Income Recognized

 

September 30, 2018

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

With no related allowance recorded:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial

$

5,456

 

 

$

7

 

 

$

3,846

 

 

$

18

 

Commercial real estate

 

4,481

 

 

 

71

 

 

 

4,401

 

 

 

283

 

With an allowance recorded:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial

 

—

 

 

 

—

 

 

 

1,214

 

 

 

46

 

Commercial real estate

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

Total:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial

$

5,456

 

 

$

7

 

 

$

5,060

 

 

$

64

 

Commercial real estate

$

4,481

 

 

$

71

 

 

$

4,401

 

 

$

283

 

 

 

 

(Amounts in thousands)

 

 

Three Months Ended

 

 

Nine Months Ended

 

 

Average Recorded Investment

 

 

Interest Income Recognized

 

 

Average Recorded Investment

 

 

Interest Income Recognized

 

September 30, 2017

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

With no related allowance recorded:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial

$

82

 

 

$

1

 

 

$

90

 

 

$

5

 

Commercial real estate

 

4,761

 

 

 

70

 

 

 

5,204

 

 

 

218

 

With an allowance recorded:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

Commercial real estate

 

425

 

 

 

1

 

 

 

608

 

 

 

7

 

Total:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial

$

82

 

 

$

1

 

 

$

90

 

 

$

5

 

Commercial real estate

$

5,186

 

 

$

71

 

 

$

5,812

 

 

$

225