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LOANS AND ALLOWANCE FOR LOAN LOSSES (Tables)
 12 Months Ended
Dec. 31, 2019
Receivables [Abstract]  
Summary of Loan Portfolio, Excluding Residential Loans Held for Sale
The following table presents the loan portfolio by segment and class, excluding residential LHFS, at December 31, 2019 and 2018.
 
20192018
Commercial real estate:
Owner-occupied$170,884  $129,650  
Non-owner occupied361,050  252,794  
Multi-family106,893  78,933  
Non-owner occupied residential120,038  100,367  
Acquisition and development:
1-4 family residential construction15,865  7,385  
Commercial and land development41,538  42,051  
Commercial and industrial214,554  160,964  
Municipal47,057  50,982  
Residential mortgage:
First lien336,372  235,296  
Home equity – term14,030  12,208  
Home equity – lines of credit165,314  143,616  
Installment and other loans50,735  33,411  
Total loans (1)
$1,644,330  $1,247,657  
(1) Includes $395.9 million and $135.0 million of acquired loans at December 31, 2019 and 2018, respectively.
Summary of Ratings Based On Internal Risk Rating System
The following summarizes the Company’s loan portfolio ratings based on its internal risk rating system at December 31, 2019 and 2018:
 
Pass
Special
Mention
Non-Impaired
Substandard
Impaired -
Substandard
DoubtfulPCI LoansTotal
December 31, 2019
Commercial real estate:
Owner-occupied$151,161  $4,513  $3,163  $5,872  $—  $6,175  $170,884  
Non-owner occupied342,753  17,152  —  —  —  1,145  361,050  
Multi-family100,361  4,822  682  345  —  683  106,893  
Non-owner occupied residential111,697  4,534  1,115  235  —  2,457  120,038  
Acquisition and development:
1-4 family residential construction15,865  —  —  —  —  —  15,865  
Commercial and land development39,939  206  1,393  —  —  —  41,538  
Commercial and industrial198,951  1,133  8,899  1,763  —  3,808  214,554  
Municipal42,649  4,408  —  —  —  —  47,057  
Residential mortgage:
First lien323,040  978  —  2,590  —  9,764  336,372  
Home equity – term13,774  74  149  13  —  20  14,030  
Home equity – lines of credit164,469  74  38  733  —  —  165,314  
Installment and other loans50,497  —  —  85  —  153  50,735  
$1,555,156  $37,894  $15,439  $11,636  $—  $24,205  $1,644,330  
December 31, 2018
Commercial real estate:
Owner-occupied$121,903  $3,024  $987  $1,880  $—  $1,856  $129,650  
Non-owner occupied242,136  10,008  —  —  —  650  252,794  
Multi-family71,482  5,886  717  131  —  717  78,933  
Non-owner occupied residential97,590  736  1,197  309  —  535  100,367  
Acquisition and development:
1-4 family residential construction
7,385  —  —  —  —  —  7,385  
Commercial and land development41,251  25  583  —  —  192  42,051  
Commercial and industrial150,286  2,278  2,940  286  —  5,174  160,964  
Municipal50,982  —  —  —  —  —  50,982  
Residential mortgage:
First lien229,971  —  —  2,877  —  2,448  235,296  
Home equity – term12,170  —  —  16  —  22  12,208  
Home equity – lines of credit142,638  165  15  798  —  —  143,616  
Installment and other loans33,229  15  1  —  —  166  33,411  
$1,201,023  $22,137  $6,440  $6,297  $—  $11,760  $1,247,657  
Summary of Impaired Loans by Class
The following table, which excludes PCI loans, summarizes impaired loans by segment and class, segregated by those for which a specific allowance was required and those for which a specific allowance was not required at December 31, 2019 and 2018. The recorded investment in loans excludes accrued interest receivable due to insignificance. Related allowances established generally pertain to those loans in which loan forbearance agreements were in the process of being negotiated or updated appraisals were pending and any partial charge-off will be recorded when final information is received.
 
 Impaired Loans with a Specific AllowanceImpaired Loans with No Specific Allowance
Recorded
Investment
(Book Balance)
Unpaid
Principal Balance
(Legal Balance)
Related
Allowance
Recorded
Investment
(Book Balance)
Unpaid
Principal Balance
(Legal Balance)
December 31, 2019
Commercial real estate:
Owner-occupied$—  $—  $—  $5,872  $8,086  
Multi-family—  —  —  345  569  
Non-owner occupied residential—  —  —  235  422  
Commercial and industrial—  —  —  1,763  3,361  
Residential mortgage:
First lien425  425  36  2,165  3,164  
Home equity—term—  —  —  13  15  
Home equity—lines of credit—  —  —  733  1,077  
Installment and other loans—  —  —  85  97  
$425  $425  $36  $11,211  $16,791  
December 31, 2018
Commercial real estate:
Owner-occupied$—  $—  $—  $1,880  $2,576  
Multi-family—  —  —  131  336  
Non-owner occupied residential—  —  —  309  632  
Commercial and industrial—  —  —  286  457  
Residential mortgage:
First lien743  743  38  2,134  2,727  
Home equity—term—  —  —  16  23  
Home equity—lines of credit—  —  —  798  1,081  
$743  $743  $38  $5,554  $7,832  
Summary of Average Recorded Investment in Impaired Loans and Related Interest Income
The following table, which excludes PCI loans, summarizes the average recorded investment in impaired loans and related recognized interest income for the years ended December 31, 2019, 2018 and 2017.
 
 201920182017
Average
Impaired
Balance
Interest
Income
Recognized
Average
Impaired
Balance
Interest
Income
Recognized
Average
Impaired
Balance
Interest
Income
Recognized
Commercial real estate:
Owner-occupied$2,455  $2  $1,495  $2  $1,000  $6  
Non-owner occupied46  —  1,842  —  392  —  
Multi-family152  —  148  —  182  —  
Non-owner occupied residential217  —  346  —  418  —  
Acquisition and development:
1-4 family residential construction—  —  181  —  154  —  
Commercial and land development21  —  1  —  —  —  
Commercial and industrial683  —  322  —  413  —  
Residential mortgage:
First lien2,582  50  3,234  59  4,012  58  
Home equity – term13  —  19  —  61  —  
Home equity – lines of credit750  2  657  2  488  2  
Installment and other loans13  —  4  —  10  —  
$6,932  $54  $8,249  $63  $7,130  $66  
Schedule of Impaired Loans That Are TDRs
The following table presents impaired loans that are TDRs, with the recorded investment at December 31, 2019 and 2018.
 
 20192018
Number of
Contracts
Recorded
Investment
Number of
Contracts
Recorded
Investment
Accruing:
Commercial real estate:
Owner-occupied1  $30  1  $39  
Residential mortgage:
First lien9  931  11  1,069  
Home equity - lines of credit1  18  1  24  
11  979  13  1,132  
Nonaccruing:
Commercial real estate:
Owner-occupied4  1,909  1  37  
Residential mortgage:
First lien5  359  8  658  
9  2,268  9  695  
20  $3,247  22  $1,827  
Schedule of Number of Loans Modified
The following table presents the number of loans modified, and their pre-modification and post-modification investment balances for the years ended December 31, 2019, and 2017. There were no loans modified during 2018.
 
Number of
Contracts
Pre-
Modification
Investment
Balance
Post-
Modification
Investment
Balance
December 31, 2019
Commercial real estate:
Owner-occupied3  $1,866  $1,881  
December 31, 2017
Commercial real estate:
Owner-occupied2  $119  $119  
Schedule of Classes of Loan Portfolio Summarized by Aging Categories The following table presents the classes of the loan portfolio summarized by aging categories of performing loans and nonaccrual loans at December 31, 2019 and 2018.
 
  Days Past Due   
Current30-5960-89
90+
(still accruing)
Total
Past Due
Non-
Accrual
Total
Loans
December 31, 2019
Commercial real estate:
Owner-occupied$158,723  $144  $—  $—  $144  $5,842  $164,709  
Non-owner occupied359,425  480  —  —  480  —  359,905  
Multi-family105,865  —  —  —  —  345  106,210  
Non-owner occupied residential116,370  841  66  69  976  235  117,581  
Acquisition and development:
1-4 family residential construction15,587  278  —  —  278  —  15,865  
Commercial and land development40,403  1,135  —  —  1,135  —  41,538  
Commercial and industrial208,668  315  —  —  315  1,763  210,746  
Municipal47,057  —  —  —  —  —  47,057  
Residential mortgage:
First lien314,473  9,092  1,234  150  10,476  1,659  326,608  
Home equity – term13,993  —  4  —  4  13  14,010  
Home equity – lines of credit163,907  417  275  —  692  715  165,314  
Installment and other loans50,224  236  37  —  273  85  50,582  
Subtotal1,594,695  12,938  1,616  219  14,773  10,657  1,620,125  
Loans acquired with credit deterioration:
Commercial real estate:
Owner-occupied6,015  —  129  31  160  —  6,175  
Non-owner occupied564  —  —  581  581  —  1,145  
Multi-family683  —  —  —  —  —  683  
Non-owner occupied residential
1,710  105  111  531  747  —  2,457  
Commercial and industrial3,792  —  —  16  16  —  3,808  
Residential mortgage:
First lien6,308  1,857  745  854  3,456  —  9,764  
Home equity – term16  4  —  —  4  —  20  
Installment and other loans131  22  —  —  22  —  153  
Subtotal19,219  1,988  985  2,013  4,986  —  24,205  
$1,613,914  $14,926  $2,601  $2,232  $19,759  $10,657  $1,644,330  
Days Past Due
Current30-5960-89
90+
(still accruing)
Total
Past Due
Non-
Accrual
Total
Loans
December 31, 2018
Commercial real estate:
Owner-occupied$125,887  $66  $—  $—  $66  $1,841  $127,794  
Non-owner occupied252,144  —  —  —  —  —  252,144  
Multi-family78,085  —  —  —  —  131  78,216  
Non-owner occupied residential99,268  226  29  —  255  309  99,832  
Acquisition and development:
1-4 family residential construction7,385  —  —  —  —  —  7,385  
Commercial and land development41,822  37  —  —  37  —  41,859  
Commercial and industrial154,988  411  105  —  516  286  155,790  
Municipal50,982  —  —  —  —  —  50,982  
Residential mortgage:
First lien228,714  1,592  734  —  2,326  1,808  232,848  
Home equity – term11,487  678  5  —  683  16  12,186  
Home equity – lines of credit142,394  420  28  —  448  774  143,616  
Installment and other loans33,135  66  44  —  110  —  33,245  
Subtotal1,226,291  3,496  945  —  4,441  5,165  1,235,897  
Loans acquired with credit deterioration:
Commercial real estate:
Owner-occupied1,784  —  72  —  72  —  1,856  
Non-owner occupied650  —  —  —  —  —  650  
Multi-family717  —  —  —  —  —  717  
Non-owner occupied residential535  —  —  —  —  —  535  
Acquisition and development:
Commercial and land development192  —  —  —  —  —  192  
Commercial and industrial4,943  231  —  —  231  —  5,174  
Residential mortgage:
First lien1,971  382  42  53  477  —  2,448  
Home equity – term17  5  —  —  5  —  22  
Installment and other loans149  13  —  4  17  —  166  
Subtotal10,958  631  114  57  802  —  11,760  
$1,237,249  $4,127  $1,059  $57  $5,243  $5,165  $1,247,657  
Schedule of Activity in Allowance for Loan Losses
The following table presents activity in the ALL for the years ended December 31, 2019, 2018 and 2017.
 
 CommercialConsumer  
Commercial
Real Estate
Acquisition
and
Development
Commercial
and
Industrial
MunicipalTotal
Residential
Mortgage
Installment
and Other
TotalUnallocatedTotal
December 31, 2019
Balance, beginning of year
$6,876  $817  $1,656  $98  $9,447  $3,753  $244  $3,997  $570  $14,014  
Provision for loan losses515  139  841  2  1,497  (347) 180  (167) (430) 900  
Charge-offs(25) —  (299) —  (324) (386) (155) (541) —  (865) 
Recoveries268  3  158  —  429  127  50  177  —  606  
Balance, end of year
$7,634  $959  $2,356  $100  $11,049  $3,147  $319  $3,466  $140  $14,655  
December 31, 2018
Balance, beginning of year
$6,763  $417  $1,446  $84  $8,710  $3,400  $211  $3,611  $475  $12,796  
Provision for loan losses(442) 396  209  14  177  363  165  528  95  800  
Charge-offs(17) (7) —  —  (24) (148) (292) (440) —  (464) 
Recoveries572  11  1  —  584  138  160  298  —  882  
Balance, end of year
$6,876  $817  $1,656  $98  $9,447  $3,753  $244  $3,997  $570  $14,014  
December 31, 2017
Balance, beginning of year
$7,530  $580  $1,074  $54  $9,238  $2,979  $144  $3,123  $414  $12,775  
Provision for loan losses38  (167) 333  30  234  531  174  705  61  1,000  
Charge-offs(835) —  (85) —  (920) (180) (166) (346) —  (1,266) 
Recoveries30  4  124  —  158  70  59  129  —  287  
Balance, end of year
$6,763  $417  $1,446  $84  $8,710  $3,400  $211  $3,611  $475  $12,796  
Summary of Ending Loan Balance Individually Evaluated for Impairment
The following table summarizes the ending loan balances individually evaluated for impairment based upon loan segment, as well as the related ALL loss allocation for each at December 31, 2019 and 2018. PCI loans are excluded from loans individually evaluated for impairment.
 
 CommercialConsumer  
Commercial
Real Estate
Acquisition
and
Development
Commercial
and
Industrial
MunicipalTotal
Residential
Mortgage
Installment
and Other
TotalUnallocatedTotal
December 31, 2019
Loans allocated by:
Individually evaluated for impairment
$6,452  $—  $1,763  $—  $8,215  $3,336  $85  $3,421  $—  $11,636  
Collectively evaluated for impairment
752,413  57,403  212,791  47,057  1,069,664  512,380  50,650  563,030  —  1,632,694  
$758,865  $57,403  $214,554  $47,057  $1,077,879  $515,716  $50,735  $566,451  $—  $1,644,330  
Allowance for loan losses allocated by:
Individually evaluated for impairment
$—  $—  $—  $—  $—  $36  $—  $36  $—  $36  
Collectively evaluated for impairment
7,634  959  2,356  100  11,049  3,111  319  3,430  140  14,619  
$7,634  $959  $2,356  $100  $11,049  $3,147  $319  $3,466  $140  $14,655  
December 31, 2018
Loans allocated by:
Individually evaluated for impairment
$2,320  $—  $286  $—  $2,606  $3,691  $—  $3,691  $—  $6,297  
Collectively evaluated for impairment
559,424  49,436  160,678  50,982  820,520  387,429  33,411  420,840  —  1,241,360  
$561,744  $49,436  $160,964  $50,982  $823,126  $391,120  $33,411  $424,531  $—  $1,247,657  
Allowance for loan losses allocated by:
Individually evaluated for impairment
$—  $—  $—  $—  $—  $38  $—  $38  $—  $38  
Collectively evaluated for impairment
6,876  817  1,656  98  9,447  3,715  244  3,959  570  13,976  
$6,876  $817  $1,656  $98  $9,447  $3,753  $244  $3,997  $570  $14,014  
Schedule of Activity for the Accretable Yield of Purchased Impaired Loans
The following table provides activity for the accretable yield of purchased impaired loans for the years ended December 31, 2019 and 2018.
20192018
Accretable yield, beginning of period$2,065  $—  
New loans purchased3,497  2,243  
Accretion of income(2,336) (178) 
Reclassifications from nonaccretable difference due to improvement in expected cash flows2,444  —  
Other changes, net1,280  —  
Accretable yield, end of period$6,950  $2,065