Loans (Tables)

3 Months Ended

Mar. 31, 2020

Loans and Leases Receivable Disclosure [Abstract]

The following table sets forth the classification of loans by class, including unearned fees, deferred costs and excluding the allowance for loan losses as of March 31, 2020 and December 31, 2019:



(In thousands)	March 31, 2020		December 31, 2019
SBA loans held for investment	$	37,074	$	35,767
Commercial loans
SBA 504 loans	25,185		26,726
Commercial other	120,029		112,014
Commercial real estate	586,336		578,643
Commercial real estate construction	54,528		47,649
Residential mortgage loans	456,072		467,706
Consumer loans
Home equity	75,240		69,589
Consumer other	74,455		73,935
Total loans held for investment	$	1,428,919	$	1,412,029
SBA loans held for sale	10,726		13,529
Total loans	$	1,439,645	$	1,425,558

Loan Portfolio by Class According to Credit Quality Indicators

The tables below detail the Company’s loan portfolio by class according to their credit quality indicators discussed in the paragraphs above as of March 31, 2020:



	March 31, 2020
	SBA, SBA 504 & Commercial loans - Internal risk ratings
(In thousands)	Pass		Special mention		Substandard		Total
SBA loans held for investment	$	35,994	$	—	$	1,080	$	37,074
Commercial loans
SBA 504 loans	23,374		1,779		32		25,185
Commercial other	114,840		3,525		1,664		120,029
Commercial real estate	584,044		749		1,543		586,336
Commercial real estate construction	54,528		—		—		54,528
Total commercial loans	776,786		6,053		3,239		786,078
Total SBA, SBA 504 and commercial loans	$	812,780	$	6,053	$	4,319	$	823,152

	Residential mortgage & Consumer loans - Performing/Nonperforming
(In thousands)			Performing		Nonperforming		Total
Residential mortgage loans			$	449,162	$	6,910	$	456,072
Consumer loans
Home equity			74,735		505		75,240
Consumer other			74,455		—		74,455
Total consumer loans			149,190		505		149,695
Total residential mortgage and consumer loans			$	598,352	$	7,415	$	605,767

The tables below detail the Company’s loan portfolio by class according to their credit quality indicators discussed in the paragraphs above as of December 31, 2019:



	December 31, 2019
	SBA, SBA 504 & Commercial loans - Internal risk ratings
(In thousands)	Pass		Special mention		Substandard		Total
SBA loans held for investment	$	34,202	$	1,115	$	450	$	35,767
Commercial loans
SBA 504 loans	24,878		1,808		40		26,726
Commercial other	107,220		3,361		1,433		112,014
Commercial real estate	576,326		758		1,559		578,643
Commercial real estate construction	47,649		—		—		47,649
Total commercial loans	756,073		5,927		3,032		765,032
Total SBA, SBA 504 and commercial loans	$	790,275	$	7,042	$	3,482	$	800,799

	Residential mortgage & Consumer loans - Performing/Nonperforming
(In thousands)			Performing		Nonperforming		Total
Residential mortgage loans			$	463,770	$	3,936	$	467,706
Consumer loans
Home equity			69,589		—		69,589
Consumer other			73,915		20		73,935
Total consumer loans			143,504		20		143,524
Total residential mortgage and consumer loans			$	607,274	$	3,956	$	611,230

Aging Analysis of Past Due and Nonaccrual Loans by Loan Class

The following tables set forth an aging analysis of past due and nonaccrual loans as of March 31, 2020 and December 31, 2019:



	March 31, 2020
(In thousands)	30-59 days past due		60-89 days past due		90+ days and still accruing		Nonaccrual (1)		Total past due		Current		Total loans
SBA loans held for investment	$	131	$	154	$	—	$	1,627	$	1,912	$	35,162	$	37,074
Commercial loans
SBA 504 loans	—		—		—		—		—		25,185		25,185
Commercial other	566		71		—		—		637		119,392		120,029
Commercial real estate	785		75		—		613		1,473		584,863		586,336
Commercial real estate construction	—		—		—		—		—		54,528		54,528
Residential mortgage loans	5,880		373		—		6,910		13,163		442,909		456,072
Consumer loans
Home equity	561		329		—		505		1,395		73,845		75,240
Consumer other	—		—		—		—		—		74,455		74,455
Total loans held for investment	$	7,923	$	1,002	$	—	$	9,655	$	18,580	$	1,410,339	$	1,428,919
SBA loans held for sale	—		—		—		—		—		10,726		10,726
Total loans	$	7,923	$	1,002	$	—	$	9,655	$	18,580	$	1,421,065	$	1,439,645


(1)	At March 31, 2020, nonaccrual loans included $427 thousand of loans guaranteed by the SBA.



	December 31, 2019
(In thousands)	30-59 days past due		60-89 days past due		90+ days and still accruing		Nonaccrual (1)		Total past due		Current		Total loans
SBA loans held for investment	$	1,048	$	—	$	—	$	1,164	$	2,212	$	33,555	$	35,767
Commercial loans
SBA 504 loans	—		1,808		—		—		1,808		24,918		26,726
Commercial other	71		—		—		316		387		111,627		112,014
Commercial real estate	215		—		—		213		428		578,215		578,643
Commercial real estate construction	—		—		—		—		—		47,649		47,649
Residential mortgage loans	4,383		1,676		930		3,936		10,925		456,781		467,706
Consumer loans
Home equity	1,446		178		—		—		1,624		67,965		69,589
Consumer other	—		113		—		20		133		73,802		73,935
Total loans held for investment	$	7,163	$	3,775	$	930	$	5,649	$	17,517	$	1,394,512	$	1,412,029
SBA loans held for sale	—		—		—		—		—		13,529		13,529
Total loans	$	7,163	$	3,775	$	930	$	5,649	$	17,517	$	1,408,041	$	1,425,558


(1)	At December 31, 2019, nonaccrual loans included $59 thousand of loans guaranteed by the SBA.

Impaired Loans with Associated Allowance Amount

The following table provides detail on the Company’s impaired loans that are individually evaluated for impairment with the associated allowance amount, if applicable, as of March 31, 2020:



	March 31, 2020
(In thousands)	Unpaid principal balance		Recorded investment		Specific reserves
With no related allowance:
SBA loans held for investment (1)	$	1,221	$	1,062	$	—
Commercial loans
Commercial other	500		—		—
Commercial real estate	913		613		—
Total commercial loans	1,413		613		—
Total impaired loans with no related allowance	2,634		1,675		—

With an allowance:
SBA loans held for investment (1)	163		138		138
Commercial loans
Commercial real estate	694		694		46
Total commercial loans	694		694		46
Total impaired loans with a related allowance	857		832		184

Total individually evaluated impaired loans:
SBA loans held for investment (1)	1,384		1,200		138
Commercial loans
Commercial other	500		—		—
Commercial real estate	1,607		1,307		46
Total commercial loans	2,107		1,307		46
Total individually evaluated impaired loans	$	3,491	$	2,507	$	184


(1)	Balances are reduced by amount guaranteed by the SBA of $427 thousand at March 31, 2020.

The following table provides detail on the Company’s impaired loans that are individually evaluated for impairment with the associated allowance amount, if applicable, as of December 31, 2019:



	December 31, 2019
(In thousands)	Unpaid principal balance		Recorded investment		Specific reserves
With no related allowance:
SBA loans held for investment (1)	$	1,224	$	1,064	$	—
Commercial loans
Commercial real estate	213		213		—
Total commercial loans	213		213		—
Total impaired loans with no related allowance	1,437		1,277		—

With an allowance:
SBA loans held for investment (1)	157		41		41
Commercial loans
Commercial other	816		316		316
Commercial real estate	705		705		57
Total commercial loans	1,521		1,021		373
Total impaired loans with a related allowance	1,678		1,062		414

Total individually evaluated impaired loans:
SBA loans held for investment (1)	1,381		1,105		41
Commercial loans
Commercial other	816		316		316
Commercial real estate	918		918		57
Total commercial loans	1,734		1,234		373
Total individually evaluated impaired loans	$	3,115	$	2,339	$	414


(1)	Balances are reduced by amount guaranteed by the SBA of $59 thousand at December 31, 2019.

Average Recorded Investments in Impaired Loans and Related Amount of Interest Recognized

The following table presents the average recorded investments in impaired loans and the related amount of interest recognized during the time period in which the loans were impaired for the three months ended March 31, 2020 and 2019. The average balances are calculated based on the month-end balances of impaired loans. When the ultimate collectability of the total principal of an impaired loan is in doubt and the loan is on nonaccrual status, all payments are applied to principal under the cost recovery method, and therefore no interest income is recognized. The interest income recognized on impaired loans noted below represents primarily accruing TDRs and nominal amounts of income recognized on a cash basis for well-collateralized impaired loans.



	For the three months ended March 31,
	2020				2019
(In thousands)	Average recorded investment		Interest income recognized on impaired loans		Average recorded investment		Interest income recognized on impaired loans
SBA loans held for investment (1)	$	1,128	$	3	$	1,183	$	4
Commercial loans
SBA 504 loans	600		32		—		—
Commercial other	5		10		7		—
Commercial real estate	1,047		12		1,789		9
Total	$	2,780	$	57	$	2,979	$	13


(1)	Balances are reduced by the average amount guaranteed by the SBA of $182 thousand and $100 thousand for the three months ended March 31, 2020 and 2019, respectively.