Loans and Allowance For Loan Losses: Troubled Debt Restructuring With Defaults Policy (Policies)

3 Months Ended

Jun. 30, 2012

Troubled Debt Restructuring With Defaults Policy:

Troubled Debt Restructuring With Defaults Policy

During the previous 12 months, three non-owner occupied residential mortgage loans totaling $164,000, three commercial real estate loans totaling $1.4 million and one consumer loan totaling $20,000, were modified as troubled debt restructurings and had payment defaults subsequent to the modifications.  When loans modified as troubled debt restructuring have subsequent payment defaults, the defaults are factored into the determination of the allowance for loan losses to ensure specific valuation allowances reflect amounts considered uncollectible.