XML 12 R26.htm IDEA: XBRL DOCUMENT v3.19.3
Loans and Allowance for Loan Losses (Tables)
 9 Months Ended
Sep. 30, 2019
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, 2019

 

 

December 31, 2018

 

 

Balance

 

 

%

 

 

Balance

 

 

%

 

Commercial

$

77,071

 

 

 

15.8

 

 

$

112,440

 

 

 

21.9

 

Commercial real estate

 

292,150

 

 

 

59.8

 

 

 

303,804

 

 

 

59.0

 

Residential real estate

 

89,709

 

 

 

18.4

 

 

 

69,845

 

 

 

13.6

 

Consumer - home equity

 

25,578

 

 

 

5.2

 

 

 

25,076

 

 

 

4.9

 

Consumer - other

 

3,927

 

 

 

0.8

 

 

 

3,227

 

 

 

0.6

 

Total loans

$

488,435

 

 

 

 

 

 

$

514,392

 

 

 

 

 

 
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

 

Decreasing

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

 

Increasing

Concentrations of credit

 

Stable
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

 

Decreasing

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, 2019

Commercial

 

 

Commercial

real estate

 

 

Residential

real estate

 

 

Consumer -

home equity

 

 

Consumer -

other

 

 

Total

 

Balance at beginning of period

$

1,717

 

 

$

2,165

 

 

$

368

 

 

$

98

 

 

$

137

 

 

$

4,485

 

Loan charge-offs

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(37

)

 

 

(37

)

Recoveries

 

—

 

 

 

—

 

 

 

—

 

 

 

1

 

 

 

12

 

 

 

13

 

Net loan recoveries (charge-offs)

 

—

 

 

 

—

 

 

 

—

 

 

 

1

 

 

 

(25

)

 

 

(24

)

Provision charged to operations

 

84

 

 

 

94

 

 

 

(23

)

 

 

2

 

 

 

23

 

 

 

180

 

Balance at end of period

$

1,801

 

 

$

2,259

 

 

$

345

 

 

$

101

 

 

$

135

 

 

$

4,641

 

 

 

(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

 

 

Nine Months Ended

(Amounts in thousands)

 

September 30, 2019

Commercial

 

 

Commercial

real estate

 

 

Residential

real estate

 

 

Consumer -

home equity

 

 

Consumer -

other

 

 

Total

 

Balance at beginning of period

$

1,232

 

 

$

2,414

 

 

$

314

 

 

$

115

 

 

$

123

 

 

$

4,198

 

Loan charge-offs

 

—

 

 

 

—

 

 

 

(29

)

 

 

—

 

 

 

(146

)

 

 

(175

)

Recoveries

 

28

 

 

 

—

 

 

 

—

 

 

 

2

 

 

 

53

 

 

 

83

 

Net loan recoveries (charge-offs)

 

28

 

 

 

—

 

 

 

(29

)

 

 

2

 

 

 

(93

)

 

 

(92

)

Provision charged to operations

 

541

 

 

 

(155

)

 

 

60

 

 

 

(16

)

 

 

105

 

 

 

535

 

Balance at end of period

$

1,801

 

 

$

2,259

 

 

$

345

 

 

$

101

 

 

$

135

 

 

$

4,641

 

 

 

(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

 

 
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, 2019 and December 31, 2018:

 

 

(Amounts in thousands)

 

September 30, 2019

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

$

579

 

 

$

—

 

 

$

—

 

 

$

—

 

 

$

—

 

 

$

579

 

Collectively evaluated for impairment

 

1,222

 

 

 

2,259

 

 

 

345

 

 

 

101

 

 

 

135

 

 

 

4,062

 

Total ending allowance balance

$

1,801

 

 

$

2,259

 

 

$

345

 

 

$

101

 

 

$

135

 

 

$

4,641

 

Loan Portfolio:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Individually evaluated for impairment

$

5,061

 

 

$

2,983

 

 

$

—

 

 

$

—

 

 

$

—

 

 

$

8,044

 

Collectively evaluated for impairment

 

72,010

 

 

 

289,167

 

 

 

89,709

 

 

 

25,578

 

 

 

3,927

 

 

 

480,391

 

Total ending loans balance

$

77,071

 

 

$

292,150

 

 

$

89,709

 

 

$

25,578

 

 

$

3,927

 

 

$

488,435

 

 

 

(Amounts in thousands)

 

December 31, 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

 

1,232

 

 

 

2,414

 

 

 

314

 

 

 

115

 

 

 

123

 

 

 

4,198

 

Total ending allowance balance

$

1,232

 

 

$

2,414

 

 

$

314

 

 

$

115

 

 

$

123

 

 

$

4,198

 

Loan Portfolio:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Individually evaluated for impairment

$

5,364

 

 

$

4,340

 

 

$

—

 

 

$

—

 

 

$

—

 

 

$

9,704

 

Collectively evaluated for impairment

 

107,076

 

 

 

299,464

 

 

 

69,845

 

 

 

25,076

 

 

 

3,227

 

 

 

504,688

 

Total ending loans balance

$

112,440

 

 

$

303,804

 

 

$

69,845

 

 

$

25,076

 

 

$

3,227

 

 

$

514,392

 

 
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, 2019 and December 31, 2018:

 

 

(Amounts in thousands)

 

 

Commercial

 

 

Commercial real estate

 

September 30, 2019

 

 

 

 

 

 

 

Pass

$

58,822

 

 

$

265,054

 

Special Mention

 

6,366

 

 

 

23,350

 

Substandard

 

11,883

 

 

 

3,746

 

Doubtful

 

—

 

 

 

—

 

Ending Balance

$

77,071

 

 

$

292,150

 

 

 

(Amounts in thousands)

 

 

Commercial

 

 

Commercial real estate

 

December 31, 2018

 

 

 

 

 

 

 

Pass

$

94,316

 

 

$

271,370

 

Special Mention

 

6,914

 

 

 

25,199

 

Substandard

 

11,210

 

 

 

7,235

 

Doubtful

 

—

 

 

 

—

 

Ending Balance

$

112,440

 

 

$

303,804

 

 
Summary of Consumer Credit Exposure

The following table is a summary of consumer credit exposure as of September 30, 2019 and December 31, 2018:

 

 

(Amounts in thousands)

 

 

Residential real estate

 

 

Consumer - home equity

 

 

Consumer - other

 

September 30, 2019

 

 

 

 

 

 

 

 

 

 

 

Performing

$

89,154

 

 

$

25,428

 

 

$

3,925

 

Nonperforming

 

555

 

 

 

150

 

 

 

2

 

Total

$

89,709

 

 

$

25,578

 

 

$

3,927

 

 

 

(Amounts in thousands)

 

 

Residential real estate

 

 

Consumer - home equity

 

 

Consumer - other

 

December 31, 2018

 

 

 

 

 

 

 

 

 

 

 

Performing

$

69,535

 

 

$

24,956

 

 

$

3,227

 

Nonperforming

 

310

 

 

 

120

 

 

 

—

 

Total

$

69,845

 

 

$

25,076

 

 

$

3,227

 

 
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, 2019 and December 31, 2018:

 

 

(Amounts in thousands)

 

 

September 30,

2019

 

 

December 31,

2018

 

Commercial

$

1,533

 

 

$

1,291

 

Commercial real estate

 

578

 

 

 

512

 

Residential real estate

 

555

 

 

 

310

 

Consumer:

 

 

 

 

 

 

 

Consumer - home equity

 

150

 

 

 

120

 

Consumer - other

 

2

 

 

 

—

 

Total

$

2,818

 

 

$

2,233

 

 
Information Related to Loans Modified in a TDR

The following presents, by class, information related to loans modified in a TDR during the periods 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, 2019 and December 31, 2018:

 

 

(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, 2019

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial

$

—

 

 

$

91

 

 

$

1,533

 

 

$

1,624

 

 

$

75,447

 

 

$

77,071

 

 

$

—

 

Commercial real estate

 

—

 

 

 

—

 

 

 

257

 

 

 

257

 

 

 

291,893

 

 

 

292,150

 

 

 

—

 

Residential real estate

 

14

 

 

 

103

 

 

 

540

 

 

 

657

 

 

 

89,052

 

 

 

89,709

 

 

 

—

 

Consumer:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consumer - home equity

 

15

 

 

 

—

 

 

 

125

 

 

 

140

 

 

 

25,438

 

 

 

25,578

 

 

 

—

 

Consumer - other

 

11

 

 

 

—

 

 

 

2

 

 

 

13

 

 

 

3,914

 

 

 

3,927

 

 

 

—

 

Total

$

40

 

 

$

194

 

 

$

2,457

 

 

$

2,691

 

 

$

485,744

 

 

$

488,435

 

 

$

—

 

 

 

(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, 2018

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial

$

14

 

 

$

—

 

 

$

1,291

 

 

$

1,305

 

 

$

111,135

 

 

$

112,440

 

 

$

—

 

Commercial real estate

 

—

 

 

 

—

 

 

 

167

 

 

 

167

 

 

 

303,637

 

 

 

303,804

 

 

 

—

 

Residential real estate

 

36

 

 

 

182

 

 

 

257

 

 

 

475

 

 

 

69,370

 

 

 

69,845

 

 

 

—

 

Consumer:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consumer - home equity

 

—

 

 

 

141

 

 

 

25

 

 

 

166

 

 

 

24,910

 

 

 

25,076

 

 

 

—

 

Consumer - other

 

17

 

 

 

—

 

 

 

—

 

 

 

17

 

 

 

3,210

 

 

 

3,227

 

 

 

—

 

Total

$

67

 

 

$

323

 

 

$

1,740

 

 

$

2,130

 

 

$

512,262

 

 

$

514,392

 

 

$

—

 

 
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, 2019 and December 31, 2018. 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, 2019 and 2018.

 

 

(Amounts in thousands)

 

 

Recorded Investment

 

 

Unpaid Principal Balance

 

 

Related Allowance

 

September 30, 2019

 

 

 

 

 

 

 

 

 

 

 

With no related allowance recorded:

 

 

 

 

 

 

 

 

 

 

 

Commercial

$

4,077

 

 

$

5,023

 

 

$

—

 

Commercial real estate

 

2,983

 

 

 

2,983

 

 

 

—

 

With an allowance recorded:

 

 

 

 

 

 

 

 

 

 

 

Commercial

 

984

 

 

 

984

 

 

 

579

 

Commercial real estate

 

—

 

 

 

—

 

 

 

—

 

Total:

 

 

 

 

 

 

 

 

 

 

 

Commercial

$

5,061

 

 

$

6,007

 

 

$

579

 

Commercial real estate

$

2,983

 

 

$

2,983

 

 

$

—

 

 

 

(Amounts in thousands)

 

 

Recorded Investment

 

 

Unpaid Principal Balance

 

 

Related Allowance

 

December 31, 2018

 

 

 

 

 

 

 

 

 

 

 

With no related allowance recorded:

 

 

 

 

 

 

 

 

 

 

 

Commercial

$

5,364

 

 

$

6,411

 

 

$

—

 

Commercial real estate

 

4,340

 

 

 

4,340

 

 

 

—

 

With an allowance recorded:

 

 

 

 

 

 

 

 

 

 

 

Commercial

 

—

 

 

 

—

 

 

 

—

 

Commercial real estate

 

—

 

 

 

—

 

 

 

—

 

Total:

 

 

 

 

 

 

 

 

 

 

 

Commercial

$

5,364

 

 

$

6,411

 

 

$

—

 

Commercial real estate

$

4,340

 

 

$

4,340

 

 

$

—

 

 

 

 

(Amounts in thousands)

 

 

Three Months Ended

 

 

Nine Months Ended

 

 

Average Recorded

Investment

 

 

Interest Income

Recognized

 

 

Average Recorded

Investment

 

 

Interest Income

Recognized

 

September 30, 2019

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

With no related allowance recorded:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial

$

4,074

 

 

$

39

 

 

$

4,395

 

 

$

258

 

Commercial real estate

 

3,049

 

 

 

45

 

 

 

3,157

 

 

 

156

 

With an allowance recorded:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial

 

984

 

 

 

—

 

 

 

769

 

 

 

—

 

Commercial real estate

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

Total:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial

$

5,058

 

 

$

39

 

 

$

5,164

 

 

$

258

 

Commercial real estate

$

3,049

 

 

$

45

 

 

$

3,157

 

 

$

156

 

 

 

 

(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