Loans Receivable and Allowance for Loan Losses (Tables)

9 Months Ended

Sep. 30, 2013

Loans and Leases Receivable Disclosure [Abstract]

The following table sets forth the Company’s gross loans by major categories as of September 30, 2013 and December 31, 2012:

(dollars in thousands)	September 30, 2013				December 31, 2012

Commercial real estate		$	328,486		$	335,561
Construction and land development			25,238			26,659
Commercial and industrial			113,302			103,768
Owner occupied real estate			150,594			126,242
Consumer and other			30,595			23,449
Residential mortgage			2,374			2,442
Total loans receivable			650,589			618,121
Deferred costs (fees)			(352	)		(220	)
Allowance for loan losses			(8,704	)		(9,542	)
Net loans receivable		$	641,533		$	608,359

Impaired Loans By Loan Portfolio Class

The following table summarizes information with regard to impaired loans by loan portfolio class as of September 30, 2013 and December 31, 2012:

	September 30, 2013						December 31, 2012
(dollars in thousands)	Recorded Investment		Unpaid Principal Balance		Related Allowance		Recorded Investment		Unpaid Principal Balance		Related Allowance
With no related allowance recorded:
Commercial real estate	$	10,161	$	10,281	$	-	$	19,231	$	20,000	$	-
Construction and land development		1,025		4,244		-		3,153		6,312		-
Commercial and industrial		3,064		4,352		-		3,793		7,106		-
Owner occupied real estate		547		867		-		505		505		-
Consumer and other		459		711		-		912		1,146		-
Total	$	15,256	$	20,455	$	-	$	27,594	$	35,069	$	-

With an allowance recorded:
Commercial real estate	$	606	$	606	$	134	$	6,085	$	6,085	$	1,077
Construction and land development		593		3,700		217		593		3,700		70
Commercial and industrial		3,274		5,674		815		3,147		3,255		861
Owner occupied real estate		2,920		2,920		444		3,450		3,450		860
Consumer and other		203		209		9		146		155		75
Total	$	7,596	$	13,109	$	1,619	$	13,421	$	16,645	$	2,943

Total:
Commercial real estate	$	10,767	$	10,887	$	134	$	25,316	$	26,085	$	1,077
Construction and land development		1,618		7,944		217		3,746		10,012		70
Commercial and industrial		6,338		10,026		815		6,940		10,361		861
Owner occupied real estate		3,467		3,787		444		3,955		3,955		860
Consumer and other		662		920		9		1,058		1,301		75
Total	$	22,852	$	33,564	$	1,619	$	41,015	$	51,714	$	2,943

Average Of Impaired Loans And Related Interest Income By Loan Portfolio Class

The following table presents additional information regarding the Company’s impaired loans for the three months ended September 30, 2013 and September 30, 2012:

	Three Months Ended September 30,
	2013				2012
(dollars in thousands)	Average Recorded Investment		Interest Income Recognized		Average Recorded Investment		Interest Income Recognized
With no related allowance recorded:
Commercial real estate	$	12,063	$	178	$	15,728	$	186
Construction and land development		1,421		3		4,878		27
Commercial and industrial		3,034		7		4,955		28
Owner occupied real estate		465		4		673		3
Consumer and other		538		-		898		4
Total	$	17,521	$	192	$	27,132	$	248

With an allowance recorded:
Commercial real estate	$	1,925	$	10	$	9,256	$	124
Construction and land development		545		-		923		-
Commercial and industrial		3,392		14		2,480		16
Owner occupied real estate		3,013		37		3,123		48
Consumer and other		163		-		121		-
Total	$	9,038	$	61	$	15,903	$	188

Total:
Commercial real estate	$	13,988	$	188	$	24,984	$	310
Construction and land development		1,966		3		5,801		27
Commercial and industrial		6,426		21		7,435		44
Owner occupied real estate		3,478		41		3,796		51
Consumer and other		701		-		1,019		4
Total	$	26,559	$	253	$	43,035	$	436

If these loans were performing under their original contractual rate, interest income on such loans would have increased approximately $113,000 and $225,000 for the three months ended September 30, 2013 and 2012, respectively.

The following table presents additional information regarding the Company’s impaired loans for the nine months ended September 30, 2013 and September 30, 2012:

	Nine Months Ended September 30,
	2013						2012
(dollars in thousands)	Average Recorded Investment			Interest Income Recognized			Average Recorded Investment		Interest Income Recognized
With no related allowance recorded:
Commercial real estate		$	15,865		$	599	$	14,786		$	556
Construction and land development			2,217			32		4,946			86
Commercial and industrial			2,968			18		4,509			106
Owner occupied real estate			299			4		1,013			30
Consumer and other			700			1		866			8
Total		$	22,049		$	654	$	26,120		$	786

With an allowance recorded:
Commercial real estate	$	4,565	$	71	$	7,488	$	259
Construction and land development		445		-		1,305		-
Commercial and industrial		3,628		42		3,454		35
Owner occupied real estate		3,201		110		2,315		96
Consumer and other		87		-		73		-
Total	$	11,926	$	223	$	14,635	$	390

Total:
Commercial real estate	$	20,430	$	670	$	22,274	$	815
Construction and land development		2,662		32		6,251		86
Commercial and industrial		6,596		60		7,963		141
Owner occupied real estate		3,500		114		3,328		126
Consumer and other		787		1		939		8
Total	$	33,975	$	877	$	40,755	$	1,176

Activity In And Ending Balances Of The Allowance For Loan Losses By Loan Portfolio Class

The following tables provide the activity in and ending balances of the allowance for loan losses by loan portfolio class at and for the three and nine months ended September 30, 2013 and September 30, 2012:

(dollars in thousands)	Commercial Real Estate				Construction and Land Development				Commercial and Industrial				Owner Occupied Real Estate				Consumer and Other				Residential Mortgage			Unallocated				Total

Three months ended September 30, 2013
Allowance for loan losses:

Beginning balance:		$	3,581			$	2,502			$	1,997			$	986			$	191			$	14		$	61			$	9,332
Charge-offs			(882	)			(5	)			-				(2	)			-				-			-				(889	)
Recoveries			-				-				10				-				1				-			-				11
Provisions (credits)			41				(473	)			(174	)			(17	)			20				-			853				250
Ending balance		$	2,740			$	2,024			$	1,833			$	967			$	212			$	14		$	914			$	8,704

Three months ended September 30, 2012
Allowance for loan losses:

Beginning balance:		$	3,961			$	1,416			$	1,816			$	1,626			$	134			$	16		$	416			$	9,385
Charge-offs			(133	)			-				(303	)			-				(1	)			-			-				(437	)
Recoveries			-				-				-				-				-				-			-				-
Provisions (credits)			794				(173	)			37				335				55				2			(200	)			850
Ending balance		$	4,622			$	1,243			$	1,550			$	1,961			$	188			$	18		$	216			$	9,798

(dollars in thousands)	Commercial Real Estate				Construction and Land Development				Commercial and Industrial				Owner Occupied Real Estate				Consumer and Other				Residential Mortgage				Unallocated			Total

Nine months ended September 30, 2013
Allowance for loan losses:

Beginning balance:		$	3,979			$	1,273			$	1,880			$	1,967			$	234			$	17			$	192		$	9,542
Charge-offs			(1,291	)			(60	)			(361	)			(321	)			(75	)			-				-			(2,108	)
Recoveries			54				-				15				-				26				-				-			95
Provisions (credits)			(2	)			811				299				(679	)			27				(3	)			722			1,175
Ending balance		$	2,740			$	2,024			$	1,833			$	967			$	212			$	14			$	914		$	8,704

Nine months ended September 30, 2012
Allowance for loan losses:

Beginning Balance:		$	7,372			$	558			$	1,928			$	1,963			$	113			$	23			$	93		$	12,050
Charge-offs			(899	)			(921	)			(1,063	)			-				(102	)			-				-			(2,985	)
Recoveries			-				105				-				-				28				-				-			133
Provisions (credits)			(1,851	)			1,501				685				(2	)			149				(5	)			123			600
Ending balance		$	4,622			$	1,243			$	1,550			$	1,961			$	188			$	18			$	216		$	9,798

The following tables provide a summary of the allowance for loan losses and balance of loans receivable by loan class and by impairment method as of September 30, 2013 and December 31, 2012:

(dollars in thousands)	Commercial Real Estate			Construction and Land Development			Commercial and Industrial			Owner Occupied Real Estate			Consumer and Other			Residential Mortgage			Unallocated			Total

September 30, 2013

Allowance for loan losses:
Individually evaluated for impairment		$	134		$	217		$	815		$	444		$	9		$	-		$	-		$	1,619
Collectively evaluated for impairment			2,606			1,807			1,018			523			203			14			914			7,085
Total allowance for loan losses		$	2,740		$	2,024		$	1,833		$	967		$	212		$	14		$	914		$	8,704

Loans receivable:
Loans evaluated individually		$	10,767		$	1,618		$	6,338		$	3,467		$	662		$	-		$	-		$	22,852
Loans evaluated collectively			317,719			23,620			106,964			147,127			29,933			2,374			-			627,737
Total loans receivable		$	328,486		$	25,238		$	113,302		$	150,594		$	30,595		$	2,374		$	-		$	650,589

(dollars in thousands)	Commercial Real Estate		Construction and Land Development		Commercial and Industrial		Owner Occupied Real Estate		Consumer and Other		Residential Mortgage		Unallocated		Total

December 31, 2012

Allowance for loan losses:
Individually evaluated for impairment	$	1,077	$	70	$	861	$	860	$	75	$	-	$	-	$	2,943
Collectively evaluated for impairment		2,902		1,203		1,019		1,107		159		17		192		6,599
Total allowance for loan losses	$	3,979	$	1,273	$	1,880	$	1,967	$	234	$	17	$	192	$	9,542

Loans receivable:
Loans evaluated individually	$	25,316	$	3,746	$	6,940	$	3,955	$	1,058	$	-	$	-	$	41,015
Loans evaluated collectively		310,245		22,913		96,828		122,287		22,391		2,442		-		577,106
Total loans receivable	$	335,561	$	26,659	$	103,768	$	126,242	$	23,449	$	2,442	$	-	$	618,121

Past Due Financing Receivables

The performance and credit quality of the loan portfolio is also monitored by analyzing the age of the loans receivable as determined by the length of time a recorded payment is past due. The following table presents the classes of the loan portfolio summarized by the past due status as of September 30, 2013 and December 31, 2012:

(dollars in thousands)	30-59 Days Past Due		60-89 Days Past Due		Greater than 90 Days		Total Past Due		Current		Total Loans Receivable		Loans Receivable > 90 Days and Accruing
At September 30, 2013
Commercial real estate	$	-	$	3,463	$	987	$	4,450	$	324,036	$	328,486	$	-
Construction and land development		-		-		1,618		1,618		23,620		25,238		-
Commercial and industrial		-		2,978		4,023		7,001		106,301		113,302		-
Owner occupied real estate		340		960		205		1,505		149,089		150,594		-
Consumer and other		40		-		662		702		29,893		30,595		-
Residential mortgage		-		-		-		-		2,374		2,374		-
Total	$	380	$	7,401	$	7,495	$	15,276	$	635,313	$	650,589	$	-

(dollars in thousands)	30-59 Days Past Due		60-89 Days Past Due		Greater than 90 Days		Total Past Due		Current		Total Loans Receivable		Loans Receivable > 90 Days and Accruing
At December 31, 2012
Commercial real estate	$	772	$	26,000	$	7,987	$	34,759	$	300,802	$	335,561	$	-
Construction and land development		-		261		1,342		1,603		25,056		26,659		-
Commercial and industrial		86		-		4,693		4,779		98,989		103,768		-
Owner occupied real estate		285		1,562		968		2,815		123,427		126,242		-
Consumer and other		-		-		1,058		1,058		22,391		23,449		202
Residential mortgage		-		-		-		-		2,442		2,442		-
Total	$	1,143	$	27,823	$	16,048	$	45,014	$	573,107	$	618,121	$	202

Classes Of The Loan Portfolio Summarized By The Aggregate Risk Rating [Table Text Block]

The following table presents the classes of the loan portfolio summarized by the aggregate pass rating and the classified ratings of special mention, substandard and doubtful within the Company’s internal risk rating system as of September 30, 2013 and December 31, 2012:

(dollars in thousands)	Pass		Special Mention		Substandard		Doubtful		Total
At September 30, 2013:
Commercial real estate	$	301,011	$	16,150	$	11,325	$	-	$	328,486
Construction and land development		23,620		-		1,618		-		25,238
Commercial and industrial		105,765		1,164		6,373		-		113,302
Owner occupied real estate		146,309		1,160		3,125		-		150,594
Consumer and other		29,600		75		920		-		30,595
Residential mortgage		2,374		-		-		-		2,374
Total	$	608,679	$	18,549	$	23,361	$	-	$	650,589

(dollars in thousands)	Pass		Special Mention		Substandard		Doubtful		Total
At December 31, 2012:
Commercial real estate	$	300,174	$	9,174	$	26,213	$	-	$	335,561
Construction and land development		22,652		261		3,746		-		26,659
Commercial and industrial		96,051		642		7,075		-		103,768
Owner occupied real estate		121,381		906		3,955		-		126,242
Consumer and other		22,033		100		1,316		-		23,449
Residential mortgage		2,442		-		-		-		2,442
Total	$	564,733	$	11,083	$	42,305	$	-	$	618,121

Nonaccrual Loans By Classes Of The Loan Portfolio

The following table shows non-accrual loans by class as of September 30, 2013 and December 31, 2012:

(dollars in thousands)	September 30, 2013			December 31, 2012

Commercial real estate		$	987		$	7,987
Construction and land development			1,618			1,342
Commercial and industrial			4,023			4,693
Owner occupied real estate			205			968
Consumer and other			662			856
Residential mortgage			-			-
Total		$	7,495		$	15,846

Troubled Debt Restructurings

The following table summarizes the balance of outstanding TDRs at September 30, 2013 and December 31, 2012:

(dollars in thousands)	Number of Loans		Accrual Status			Non- Accrual Status			Total TDRs
September 30, 2013
Commercial real estate		1		$	300		$	-		$	300
Construction and land development		-			-			-			-
Commercial and industrial		1			2,201			-			2,201
Owner occupied real estate		1			1,904			-			1,904
Consumer and other		-			-			-			-
Residential mortgage		-			-			-			-
Total		3		$	4,405		$	-		$	4,405

December 31, 2012
Commercial real estate		1		$	1,261		$	-		$	1,261
Construction and land development		1			2,069			-			2,069
Commercial and industrial		1			2,248			-			2,248
Owner occupied real estate		1			1,933			-			1,933
Consumer and other		-			-			-			-
Residential mortgage		-			-			-			-
Total		4		$	7,511		$	-		$	7,511