Loans (Tables)

6 Months Ended

Jun. 30, 2013

Receivables [Abstract]

Summary of Loans

Loans consist of the following:

(Dollars in thousands)	June 30, 2013		December 31, 2012
Commercial	$	116,898	$	104,899
Commercial real estate		129,013		119,192
Residential real estate		111,186		110,412
Construction & land development		14,056		23,358
Consumer		6,790		6,480
Total loans before deferred costs		377,943		364,341
Deferred loan costs		248		239
Total Loans	$	378,191	$	364,580

Schedule of Allowances for Loan Losses by Portfolio Segment

The following table details activity in the allowance for loan losses by portfolio segment for the three and six month periods ended June 30, 2013 and 2012.

(Dollars in thousands)	Commercial			Commercial Real Estate			Residential Real Estate			Construction & Land Development			Consumer			Unallocated			Total
Three months ended June 30, 2013
Beginning balance, March 31, 2013	$	1,176		$	1,824		$	1,282		$	134		$	68		$	320		$	4,804
Provision for possible loan losses		171			42			(110	)		28			65			14			210
Charge-offs		(32	)		(51	)		—			—			(12	)		—			(95	)
Recoveries		1			—			2			—			23			—			26
Net charge-offs		(31	)		(51	)		2			—			11						(69	)
Ending balance	$	1,316		$	1,815		$	1,174		$	162		$	144		$	334		$	4,945
(Dollars in thousands)	Commercial			Commercial Real Estate			Residential Real Estate			Construction & Land Development			Consumer			Unallocated			Total
Six months ended June 30, 2013
Beginning balance, December 31, 2012	$	933		$	1,902		$	1,096		$	253		$	76		$	320		$	4,580
Provision for possible loan losses		413			(36	)		67			(91	)		53			14			420
Charge-offs		(38	)		(51	)		—			—			(22	)		—			(111	)
Recoveries		8			—			11			—			37			—			56
Net charge-offs		(30	)		(51	)		11			—			15			—			(55	)
Ending balance	$	1,316		$	1,815		$	1,174		$	162		$	144		$	334		$	4,945
(Dollars in thousands)	Commercial			Commercial Real Estate			Residential Real Estate			Construction & Land Development			Consumer			Unallocated			Total
Three months ended June 30, 2012
Beginning balance, March 31, 2012	$	976		$	1,649		$	939		$	184		$	74		$	424		$	4,246
Provision for possible loan losses		(78	)		278			87			33			(7	)		(108	)		205
Charge-offs		(11	)		—			(59	)		—			(15	)		—			(85	)
Recoveries		9			—			84			—			12			—			105
Net charge-offs		(2	)		—			25			—			(3	)		—			20
Ending balance	$	896		$	1,927		$	1,051		$	217		$	64		$	316		$	4,471
(Dollars in thousands)	Commercial			Commercial Real Estate			Residential Real Estate			Construction & Land Development			Consumer			Unallocated			Total
Six months ended June 30, 2012
Beginning balance, December 31, 2011	$	1,024		$	1,673		$	894		$	180		$	78		$	233		$	4,082
Provision for possible loan losses		(127	)		268			172			37			(22	)		83			411
Charge-offs		(15	)		(14	)		(104	)		—			(31	)		—			(164	)
Recoveries		14			—			89			—			39			—			142
Net charge-offs		(1	)		(14	)		(15	)		—			8			—			(22	)
Ending balance	$	896		$	1,927		$	1,051		$	217		$	64		$	316		$	4,471

Allowances for Loan Losses and Ending Balances by Portfolio Segment and Based on Impairment Method

The following table presents the balance in the allowance for loan losses and the ending loan balances by portfolio segment and based on the impairment method as of June 30, 2013 and December 31, 2012:

(Dollars in thousands)	Commercial		Commercial Real Estate		Residential Real Estate		Construction & Land Development		Consumer		Unallocated		Total
June 30, 2013
Allowance for loan losses:
Ending allowance balances attributable to loans:
individually evaluated for impairment	$	194	$	463	$	264	$	—	$	—	$	—	$	921
Collectively evaluated for impairment		1,122		1,352		910		162		144		334		4,024
Total ending allowance balance	$	1,316	$	1,815	$	1,174	$	162	$	144	$	334	$	4,945
Loans:
Loans individually evaluated for impairment	$	3,504	$	3,502	$	1,690	$	—	$	—			$	8,696
Loans collectively evaluated for impairment		113,394		125,511		109,496		14,056		6,790				369,247
Total ending loans balance	$	116,898	$	129,013	$	111,186	$	14,056	$	6,790			$	377,943
December 31, 2012
Allowance for loan losses:
Ending allowance balances attributable to loans:
Individually evaluated for impairment	$	85	$	522	$	172	$	—	$	—	$	—	$	779
Collectively evaluated for impairment		848		1,380		924		253		76		320		3,801
Total ending allowance balance	$	933	$	1,902	$	1,096	$	253	$	76	$	320	$	4,580
Loans:
Loans individually evaluated for impairment	$	4,315	$	4,573	$	1,137	$	166	$	—			$	10,191
Loans collectively evaluated for impairment		100,584		114,619		109,275		23,192		6,480				354,150
Total ending loans balance	$	104,899	$	119,192	$	110,412	$	23,358	$	6,480			$	364,341

Schedule of Impairment by Class of Loans

The following table presents loans individually evaluated for impairment by class of loans as of June 30, 2013 and December 31, 2012:

(Dollars in thousands)	Unpaid Principal Balance		Recorded Investment with no Allowance		Recorded Investment with Allowance		Total Recorded Investment		Related Allowance		Average Recorded Investment		Interest Income Recognized
June 30, 2013
Commercial	$	3,506	$	76	$	3,436	$	3,512	$	194	$	3,988	$	84
Commercial real estate		3,839		698		2,805		3,503		463		3,838		85
Residential real estate		1,792		548		1,146		1,694		264		1,233		19
Construction & land development		—		—		—		—		—		42		2
Total impaired loans	$	9,137	$	1,322	$	7,387	$	8,709	$	921	$	9,101	$	190
December 31, 2012
Commercial	$	4,315	$	—	$	4,329	$	4,329	$	85	$	4,123	$	167
Commercial real estate		4,906		1,723		2,849		4,572		522		4,396		152
Residential real estate		1,223		86		1,057		1,143		172		770		18
Construction & land development		173		166		—		166		—		167		—
Total impaired loans	$	10,617	$	1,975	$	8,235	$	10,210	$	779	$	9,456	$	337

Schedule of Aging of Past Due and Nonaccrual Loans

The following table presents the aging of past due loans and nonaccrual loans as of June 30, 2013 and December 31, 2012 by class of loans:

(Dollars in thousands)	Current		30 - 59 Days Past Due		60 - 89 Days Past Due		90 Days + Past Due		Non- Accrual		Total Past Due and Non- Accrual		Total Loans
June 30, 2013
Commercial	$	116,588	$	105	$	152	$	—	$	53	$	310	$	116,898
Commercial real estate		127,247		583		—		—		1,183		1,766		129,013
Residential real estate		109,396		616		25		133		1,016		1,790		111,186
Construction & land development		14,050		—		—		—		6		6		14,056
Consumer		6,576		151		61		2		—		214		6,790
Total Loans	$	373,857	$	1,455	$	238	$	135	$	2,258	$	4,086	$	377,943
December 31, 2012
Commercial	$	104,348	$	60	$	8	$	—	$	483	$	551	$	104,899
Commercial real estate		117,372		41		34		—		1,745		1,820		119,192
Residential real estate		108,574		472		430		131		805		1,838		110,412
Construction & land development		23,180		—		5		—		173		178		23,358
Consumer		6,325		132		23		—		—		155		6,480
Total Loans	$	359,799	$	705	$	500	$	131	$	3,206	$	4,542	$	364,341

Summary of Troubled Debt Restructurings

Loan modifications that are considered TDR’s completed during the three and six month periods ending June 30, 2013 and 2012 were as follows:

	For the Three Months Ended June 30, 2013
(Dollars in thousands)	Number of loans restructured		Pre- Modification Recorded Investment		Post- Modification Recorded Investment
Commercial		2	$	76	$	76
Total Restructured Loans		2	$	76	$	76
	For the Six Months Ended June 30, 2013
(Dollars in thousands)	Number of loans restructured		Pre- Modification Recorded Investment		Post- Modification Recorded Investment
Commercial		2	$	76	$	76
Total Restructured Loans		2	$	76	$	76
	For the Three Months Ended June 30, 2012
(Dollars in thousands)	Number of loans restructured		Pre- Modification Recorded Investment		Post- Modification Recorded Investment
Commercial real estate		1	$	140	$	140
Residential real estate		5		333		333
Total Restructured Loans		6	$	473	$	473
	For the Six Months Ended June 30, 2012
(Dollars in thousands)	Number of loans restructured		Pre- Modification Recorded Investment		Post- Modification Recorded Investment
Commercial real estate		1	$	140	$	140
Residential real estate		7		488		488
Total Restructured Loans		8	$	628	$	628

Summary of Loans by Credit Quality Indicator

As of June 30, 2013 and December 31, 2012, and based on the most recent analysis performed, the risk category of loans by class of loans is as follows:

(Dollars in thousands)	Pass		Special Mention		Substandard		Doubtful		Not Rated		Total
June 30, 2013
Commercial	$	99,512	$	7,220	$	9,158	$	—	$	1,008	$	116,898
Commercial real estate		113,780		7,206		6,639		—		1,388		129,013
Residential real estate		190		—		50		—		110,946		111,186
Construction & land development		10,602		1,451		991		—		1,012		14,056
Consumer		—		—		—		—		6,790		6,790
Total	$	224,084	$	15,877	$	16,838	$	—	$	121,144	$	377,943
December 31, 2012
Commercial	$	92,123	$	5,854	$	6,637	$	—	$	285	$	104,899
Commercial real estate		102,602		5,671		8,459		—		2,460		119,192
Residential real estate		200		—		53		—		110,159		110,412
Construction & land development		18,063		2,750		1,244		—		1,301		23,358
Consumer		—		—		—		—		6,480		6,480
Total	$	212,988	$	14,275	$	16,393	$	—	$	120,685	$	364,341

Schedule of Loans Not Rated by Class of Loans

The following table presents loans that are not rated by class of loans as of June 30, 2013 and December 31, 2012. Non-performing loans include loans past due 90 days and greater and loans on nonaccrual of interest.

(Dollars in thousands)	Performing		Non-Performing		Total
June 30, 2013
Commercial	$	1,002	$	6	$	1,008
Commercial real estate		1,388		—		1,388
Residential real estate		109,841		1,105		110,946
Construction & land development		1,012		—		1,012
Consumer		6,788		2		6,790
Total	$	120,031	$	1,113	$	121,144
December 31, 2012
Commercial	$	285	$	—	$	285
Commercial real estate		2,460		—		2,460
Residential real estate		109,276		883		110,159
Construction & land development		1,294		7		1,301
Consumer		6,480		—		6,480
Total	$	119,795	$	890	$	120,685