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LOANS (Tables)
 9 Months Ended
Sep. 30, 2020
Receivables [Abstract]  
Schedule of Loans Receivable
Loans consist of the following:
 September 30, 2020December 31, 2019
(dollars in thousands)Total% of Gross LoansTotal% of Gross Loans
Portfolio Loans:
Commercial real estate$1,021,987 68.29 %$964,777 66.34 %
Residential first mortgages147,756 9.87 %167,710 11.53 %
Residential rentals137,950 9.22 %123,601 8.50 %
Construction and land development36,061 2.41 %34,133 2.35 %
Home equity and second mortgages31,427 2.10 %36,098 2.48 %
Commercial loans58,894 3.94 %63,102 4.34 %
Consumer loans1,081 0.07 %1,104 0.08 %
Commercial equipment61,376 4.10 %63,647 4.38 %
Gross portfolio loans1,496,532 100.00 %1,454,172 100.00 %
Less:
Net deferred costs1,610 0.11 %1,879 0.13 %
Allowance for loan losses(18,829)(1.26)%(10,942)(0.75)%
(17,219)(9,063)
Net portfolio loans$1,479,313 $1,445,109 
U.S. Small Business Administration ("SBA") Paycheck Protection Program ("PPP") loans$131,088 $— 
Net deferred fees(3,277)— 
Net SBA PPP Loans$127,811 $— 
Total net loans$1,607,124 $1,445,109 
Gross Loans$1,627,620 $1,454,172 
Non-accrual loans
Non-accrual and Aging Analysis of Current and Past Due Loans
Non-accrual loans as of September 30, 2020 and December 31, 2019 were as follows:
 September 30, 2020
(dollars in thousands)Non-accrual Delinquent LoansNumber of LoansNon-accrual Current LoansNumber of LoansTotal Non-accrual LoansTotal Number of Loans
Commercial real estate$14,859 14 $2,147 7 $17,006 21 
Residential first mortgages333 2 191 1 524 3 
Residential rentals— — 280 2 280 2 
Home equity and second mortgages229 4 250 2 479 6 
Commercial loans1,807 2 — — 1,807 2 
Commercial equipment— — 52 3 52 3 
 $17,228 22 $2,920 15 $20,148 37 

 December 31, 2019
(dollars in thousands)Non-accrual Delinquent LoansNumber of LoansNon-accrual Current LoansNumber of LoansTotal Non-accrual LoansTotal Number of Loans
Commercial real estate$10,562 11 $1,687 5 $12,249 16 
Residential first mortgages— — 830 3 830 3 
Residential rentals— — 937 5 937 5 
Home equity and second mortgages177 3 271 3 448 6 
Commercial loans1,807 2 1,320 1 3,127 3 
Commercial equipment241 5 25 1 266 6 
$12,787 21 $5,070 18 $17,857 39 
Past Due Financing Receivables
Past due and PCI loans as of September 30, 2020 and December 31, 2019 were as follows:
 September 30, 2020
(dollars in thousands)31-60 Days61-89 Days90 or Greater DaysTotal Past DuePCI LoansCurrentTotal Loan Receivables
Commercial real estate$— $— $14,860 $14,860 $1,581 $1,005,546 $1,021,987 
Residential first mortgages— — 333 333 — 147,423 147,756 
Residential rentals— 297 — 297 — 137,653 137,950 
Construction and land dev.— — — — — 36,061 36,061 
Home equity and second mtg.541 — 230 771 404 30,252 31,427 
Commercial loans— — 1,807 1,807 — 57,087 58,894 
Consumer loans— — — — — 1,081 1,081 
Commercial equipment— — — — — 61,376 61,376 
Total portfolio loans$541 $297 $17,230 $18,068 $1,985 $1,476,479 $1,496,532 
U.S. SBA PPP loans$— $— $— $— $— $131,088 $131,088 

 December 31, 2019
(dollars in thousands)31-60 Days61-89 Days90 or Greater DaysTotal Past DuePCI LoansCurrentTotal Loan Receivables
Commercial real estate$— $217 $10,563 $10,780 $1,738 $952,259 $964,777 
Residential first mortgages— — — — — 167,710 167,710 
Residential rentals— — — — 295 123,306 123,601 
Construction and land dev.— — — — — 34,133 34,133 
Home equity and second mtg.98 23 177 298 391 35,409 36,098 
Commercial loans— — 1,807 1,807 — 61,295 63,102 
Consumer loans— — — — — 1,104 1,104 
Commercial equipment52 159 231 442 — 63,205 63,647 
Total portfolio loans$150 $399 $12,778 $13,327 $2,424 $1,438,421 $1,454,172 
Impaired Loans, Including TDRs
Impaired loans, including TDRs, at September 30, 2020 and 2019 and at December 31, 2019 were as follows:
 September 30, 2020
(dollars in thousands)Unpaid Contractual Principal BalanceRecorded Investment With No AllowanceRecorded Investment With AllowanceTotal Recorded InvestmentRelated AllowanceQuarter Average Recorded InvestmentQuarter Interest Income RecognizedYTD Average Recorded InvestmentYTD Interest Income Recognized
Commercial real estate$18,355 $16,000 $2,148 $18,148 $468 $18,181 $74 $18,243 $299 
Residential first mortgages1,741 1,739 — 1,739 — 1,747 11 1,770 39 
Residential rentals636 636 — 636 — 638 6 648 24 
Home equity and second mtg.552 540 — 540 — 542 3 607 12 
Commercial loans1,807 1,807 — 1,807 — 1,807 — 1,807 — 
Commercial equipment532 476 42 518 42 527 8 536 29 
Total$23,623 $21,198 $2,190 $23,388 $510 $23,442 $102 $23,611 $403 
 September 30, 2019
(dollars in thousands)Unpaid Contractual Principal BalanceRecorded Investment With No AllowanceRecorded Investment With AllowanceTotal Recorded InvestmentRelated AllowanceQuarter Average Recorded InvestmentQuarter Interest Income RecognizedYTD Average Recorded InvestmentYTD Interest Income Recognized
Commercial real estate$21,159 $16,175 $4,799 $20,974 $444 $21,023 $183 $21,309 $591 
Residential first mortgages2,089 2,089 2,089 2,098 23 2,125 66 
Residential rentals956 956 956 961 14 977 44 
Home equity and second mtg.588 577 577 580 5 579 21 
Commercial loans2,641 1,807 822 2,629 822 2,648 9 2,669 65 
Commercial equipment830 601 210 811 210 822 8 846 32 
Total$28,263 $22,205 $5,831 $28,036 $1,476 $28,132 $242 $28,505 $819 

 December 31, 2019
(dollars in thousands)Unpaid Contractual Principal BalanceRecorded Investment With No AllowanceRecorded Investment With AllowanceTotal Recorded InvestmentRelated AllowanceYTD Average Recorded InvestmentYTD Interest Income Recognized
Commercial real estate$20,914 $15,919 $4,788 $20,707 $417 $21,035 $813 
Residential first mortgages1,921 1,917 — 1,917 — 1,962 86 
Residential rentals941 937 — 937 — 967 56 
Home equity and second mtg.524 510 — 510 — 519 23 
Commercial loans3,127 1,807 1,320 3,127 210 3,284 152 
Commercial equipment808 585 203 788 201 826 35 
Total$28,235 $21,675 $6,311 $27,986 $828 $28,593 $1,165 
TDRs, Included in Impaired Loans Schedule
TDRs included in the impaired loan schedules above, as of September 30, 2020 and December 31, 2019 were as follows:
 September 30, 2020December 31, 2019
(dollars in thousands)Dollars Number of LoansDollarsNumber of Loans
Commercial real estate$1,376 2 $1,420 3 
Residential first mortgages254 2 64 1 
Commercial equipment473 2 565 4 
Total TDRs$2,103 6 $2,049 8 
Less: TDRs included in non-accrual loans(1,530)(3)(1,399)(3)
Total accrual TDR loans$573 3 $650 5 
Allowance for Credit Losses on Financing Receivables The following tables detail activity in the ALLL at and for the three and nine months ended September 30, 2020 and 2019, respectively. An allocation of the allowance to one category of loans does not prevent the Company from using that allowance to absorb losses in a different category. There is no allowance for loan loss on the PCI portfolios.
Three Months EndedSeptember 30, 2020
(dollars in thousands)Beginning BalanceCharge-offsRecoveriesProvisionsEnding Balance
Commercial real estate$11,268 $(15)$15 $1,852 $13,120 
Residential first mortgages885 — — 225 1,110 
Residential rentals1,059 — — 420 1,479 
Construction and land development428 — — 26 454 
Home equity and second mortgages259 — 7 46 312 
Commercial loans1,161 — 5 (87)1,079 
Consumer loans15 (6)— 11 20 
Commercial equipment1,243 (44)49 7 1,255 
 $16,318 $(65)$76 $2,500 $18,829 
Nine Months EndedSeptember 30, 2020
(dollars in thousands)Beginning BalanceCharge-offsRecoveriesProvisionsEnding Balance
Commercial real estate$7,398 $(944)$15 $6,651 $13,120 
Residential first mortgages464 — — 646 1,110 
Residential rentals397 — — 1,082 1,479 
Construction and land development273 — — 181 454 
Home equity and second mortgages149 (25)8 180 312 
Commercial loans1,086 (1,027)15 1,005 1,079 
Consumer loans10 (6)— 16 20 
Commercial equipment1,165 (326)77 339 1,255 
$10,942 $(2,328)$115 $10,100 $18,829 
Three Months EndedSeptember 30, 2019
(dollars in thousands)Beginning BalanceCharge-offsRecoveriesProvisionsEnding Balance
Commercial real estate$7,009 $(144)$— $238 $7,103 
Residential first mortgages709 — — (80)629 
Residential rentals458 — — (51)407 
Construction and land development246 — — (52)194 
Home equity and second mortgages131 — 1 (7)125 
Commercial loans1,402 — 10 189 1,601 
Consumer loans9 — — (1)8 
Commercial equipment954 — 17 214 1,185 
$10,918 $(144)$28 $450 $11,252 
Six Months EndedSeptember 30, 2019
(dollars in thousands)Beginning BalanceCharge-offsRecoveriesProvisionsEnding Balance
Commercial real estate$6,882 $(148)$15 $354 $7,103 
Residential first mortgages755 — — (126)629 
Residential rentals498 (53)46 (84)407 
Construction and land development310 (329)— 213 194 
Home equity and second mortgages133 — 5 (13)125 
Commercial loans1,482 — 20 99 1,601 
Consumer loans6 (4)2 4 8 
Commercial equipment910 (685)82 878 1,185 
$10,976 $(1,219)$170 $1,325 $11,252 
The following tables detail loan receivable and allowance balances disaggregated on the basis of the Company’s impairment methodology at September 30, 2020 and 2019 and December 31, 2019.
 September 30, 2020December 31, 2019September 30, 2019
(dollars in thousands)Ending balance: individually evaluated for impairmentEnding balance: collectively evaluated for impairmentPurchase Credit ImpairedTotalEnding balance: individually evaluated for impairmentEnding balance: collectively evaluated for impairmentPurchase Credit ImpairedTotalEnding balance: individually evaluated for impairmentEnding balance: collectively evaluated for impairmentPurchase Credit ImpairedTotal
Loan Receivables:
Commercial real estate$18,148 $1,002,258 $1,581 $1,021,987 $20,707 $942,332 $1,738 $964,777 $20,974 $909,638 $1,732 $932,344 
Residential first mortgages1,739 146,017 — 147,756 1,917 165,793 — 167,710 2,089 161,187 451 163,727 
Residential rentals636 137,314 — 137,950 937 122,369 295 123,601 956 119,897 317 121,170 
Construction and land development— 36,061 — 36,061 — 34,133 — 34,133 — 30,774 — 30,774 
Home equity and second mortgages540 30,483 404 31,427 510 35,197 391 36,098 577 35,302 303 36,182 
Commercial loans1,807 57,087 — 58,894 3,127 59,975 — 63,102 2,629 66,550 — 69,179 
Consumer loans— 1,081 — 1,081 — 1,104 — 1,104 — 937 — 937 
Commercial equipment518 60,858 — 61,376 788 62,859 — 63,647 811 60,293 — 61,104 
$23,388 $1,471,159 $1,985 $1,496,532 $27,986 $1,423,762 $2,424 $1,454,172 $28,036 $1,384,578 $2,803 $1,415,417 
Allowance for loan losses:
Commercial real estate$468 $12,652 $— $13,120 $417 $6,981 $— $7,398 $444 $6,659 $— $7,103 
Residential first mortgages— 1,110 — 1,110 — 464 — 464 — 629 — 629 
Residential rentals— 1,479 — 1,479 — 397 — 397 — 407 — 407 
Construction and land development— 454 — 454 — 273 — 273 — 194 — 194 
Home equity and second mortgages— 312 — 312 — 149 — 149 — 125 — 125 
Commercial loans— 1,079 — 1,079 210 876 — 1,086 822 779 — 1,601 
Consumer loans— 20 — 20 — 10 — 10 — 8 — 8 
Commercial equipment42 1,213 — 1,255 201 964 — 1,165 210 975 — 1,185 
$510 $18,319 $— $18,829 $828 $10,114 $— $10,942 $1,476 $9,776 $— $11,252 
Credit Quality Indicators
Credit quality indicators as of September 30, 2020 and December 31, 2019 were as follows:
Credit Risk Profile by Internally Assigned Grade
 Commercial Real EstateConstruction and Land Dev.Residential Rentals
(dollars in thousands)9/30/202012/31/20199/30/202012/31/20199/30/202012/31/2019
Unrated$171,449 $102,695 $2,321 $2,075 $48,014 $38,139 
Pass831,763 840,403 33,740 32,058 89,105 84,811 
Special mention1,041 — — — 831 — 
Substandard17,734 21,679 — — — 651 
Doubtful— — — — — — 
Loss— — — — — — 
Total$1,021,987 $964,777 $36,061 $34,133 $137,950 $123,601 

 Commercial LoansCommercial EquipmentTotal Commercial Portfolios
(dollars in thousands)9/30/202012/31/20199/30/202012/31/20199/30/202012/31/2019
Unrated$13,558 $16,754 $25,938 $26,045 $261,280 $185,708 
Pass43,529 43,221 35,290 37,399 1,033,427 1,037,892 
Special mention— — 106 — 1,978 — 
Substandard1,807 3,127 42 203 19,583 25,660 
Doubtful— — — — — — 
Loss— — — — — — 
Total$58,894 $63,102 $61,376 $63,647 $1,316,268 $1,249,260 

Non-Commercial Portfolios **U.S. SBA PPP LoansTotal All Portfolios
(dollars in thousands)9/30/202012/31/20196/30/202012/31/20199/30/202012/31/2019
Unrated$150,318 $164,991 $131,088 $— $542,686 $350,699 
Pass28,465 38,718 — — 1,061,892 1,076,610 
Special mention462 — — — 2,440 — 
Substandard1,019 1,203 — — 20,602 26,863 
Doubtful— — — — — — 
Loss— — — — — — 
Total$180,264 $204,912 $131,088 $— $1,627,620 $1,454,172 
** Non-commercial portfolios are generally evaluated based on payment activity but may be risk graded if part of a larger commercial relationship or are credit impaired (e.g. non-accrual loans, TDRs).
Credit Risk Profile Based on Payment Activity
 Residential First MortgagesHome Equity and Second Mtg.Consumer Loans
(dollars in thousands)9/30/202012/31/20199/30/202012/31/20199/30/202012/31/2019
Performing$147,423 $167,710 $31,197 $35,921 $1,081 $1,104 
Nonperforming333 — 230 177 — — 
Total$147,756 $167,710 $31,427 $36,098 $1,081 $1,104 
Certain Loans Acquired In Transfer Not Accounted for as Debt Securities, Accretable Yield Movement Table
A summary of changes in the accretable yield for PCI loans for the three and nine months ended September 30, 2020 and 2019 and the year ended December 31, 2019 follows:
 Three Months Ended September 30,Nine Months Ended September 30,
(dollars in thousands)2020201920202019
Accretable yield, beginning of period$415 $779 $677 $734 
Additions— — — — 
Accretion(46)(124)(184)(246)
Reclassification from (to) nonaccretable difference— — 24 156 
Other changes, net— — (148)11 
Accretable yield, end of period$369 $655 $369 $655 
Summary Of Acquired And Non Acquired Loans Table
The following is a summary of acquired and non-acquired loans as of September 30, 2020 and December 31, 2019:
BY ACQUIRED AND NON-ACQUIREDSeptember 30, 2020%December 31, 2019%
Acquired loans - performing$62,002 3.81 %$74,654 5.13 %
Acquired loans - purchase credit impaired ("PCI")1,986 0.12 %2,424 0.17 %
Total acquired loans63,988 3.93 %77,078 5.30 %
U.S. SBA PPP loans131,088 8.05 %— — %
Non-acquired loans**1,432,544 88.01 %1,377,094 94.70 %
Gross loans1,627,620 1,454,172 
Net deferred costs (fees)(1,667)(0.10)%1,879 0.13 %
Total loans, net of deferred costs$1,625,953 $1,456,051 
______________________________
**Non-acquired loans include loans transferred from acquired pools following release of acquisition accounting FMV adjustments.