Loans and Allowance for Credit Losses (Tables)

3 Months Ended

Mar. 31, 2017

Loans and Allowance for Credit Losses [Abstract]

The following table provides information about the principal classes of the loan portfolio at March 31, 2017 and December 31, 2016.


(Dollars in thousands)	March 31, 2017		December 31, 2016
Construction	$	91,498	$	84,002
Residential real estate		331,191		325,768
Commercial real estate		388,391		382,681
Commercial		74,189		72,435
Consumer		6,595		6,639
Total loans		891,864		871,525
Allowance for credit losses		(8,927)		(8,726)
Total loans, net	$	882,937	$	862,799

Allowance for Credit Losses on Financing Receivables

The following tables include impairment information relating to loans and the allowance for credit losses as of March 31, 2017 and December 31, 2016.


			Residential		Commercial
(Dollars in thousands)	Construction		real estate		real estate		Commercial		Consumer		Unallocated		Total
March 31, 2017
Loans individually
evaluated for impairment	$	7,883	$	7,974	$	5,555	$	-	$	99	$	-	$	21,511
Loans collectively
evaluated for impairment		83,615		323,217		382,836		74,189		6,496		-		870,353
Total loans	$	91,498	$	331,191	$	388,391	$	74,189	$	6,595	$	-	$	891,864

Allowance for credit
losses allocated to:
Loans individually
evaluated for impairment	$	683	$	282	$	183	$	-	$	-	$	-	$	1,148
Loans collectively
evaluated for impairment		1,607		1,849		2,729		1,338		256		-		7,779
Total loans	$	2,290	$	2,131	$	2,912	$	1,338	$	256	$	-	$	8,927


			Residential		Commercial
(Dollars in thousands)	Construction		real estate		real estate		Commercial		Consumer		Unallocated		Total
December 31, 2016
Loans individually
evaluated for impairment	$	8,007	$	7,778	$	6,088	$	-	$	99	$	-	$	21,972
Loans collectively
evaluated for impairment		75,995		317,990		376,593		72,435		6,540		-		849,553
Total loans	$	84,002	$	325,768	$	382,681	$	72,435	$	6,639	$	-	$	871,525

Allowance for credit
losses allocated to:
Loans individually
evaluated for impairment	$	1,639	$	317	$	185	$	-	$	-	$	-	$	2,141
Loans collectively
evaluated for impairment		1,148		1,636		2,425		1,145		231		-		6,585
Total loans	$	2,787	$	1,953	$	2,610	$	1,145	$	231	$	-	$	8,726

Impaired Financing Receivables

The following tables provide information on impaired loans and any related allowance by loan class as of March 31, 2017 and December 31, 2016. The difference between the unpaid principal balance and the recorded investment is the amount of partial charge-offs that have been taken.


				Recorded		Recorded
	Unpaid			investment		investment			Average		Interest
	principal			with no		with an	Related		recorded		income
(Dollars in thousands)	balance			allowance		allowance	allowance		investment		recognized
March 31, 2017
Impaired nonaccrual loans:
Construction	$	7,527	$	76	$	3,628	$	666	$	3,717	$	-
Residential real estate		4,491		2,689		1,581		134		4,010		-
Commercial real estate		1,213		481		175		99		721		-
Commercial		-		-		-		-		-		-
Consumer		99		99		-		-		99		-
Total	$	13,330	$	3,345	$	5,384	$	899	$	8,547	$	-

Impaired accruing TDRs:
Construction	$	4,179	$	3,474	$	705	$	17	$	4,182	$	30
Residential real estate		3,704		2,665		1,039		148		3,762		43
Commercial real estate		4,899		1,877		3,022		84		4,908		57
Commercial		-		-		-		-		-		-
Consumer		-		-		-		-		-		-
Total	$	12,782	$	8,016	$	4,766	$	249	$	12,852	$	130

Total impaired loans:
Construction	$	11,706	$	3,550	$	4,333	$	683	$	7,899	$	30
Residential real estate		8,195		5,354		2,620		282		7,772		43
Commercial real estate		6,112		2,358		3,197		183		5,629		57
Commercial		-		-		-		-		-		-
Consumer		99		99		-		-		99		-
Total	$	26,112	$	11,361	$	10,150	$	1,148	$	21,399	$	130



				Recorded		Recorded			March 31, 2016
	Unpaid			investment		investment			Average		Interest
	principal			with no		with an	Related		recorded		income
(Dollars in thousands)	balance			allowance		allowance	allowance		investment		recognized
December 31, 2016
Impaired nonaccrual loans:
Construction	$	7,247	$	-	$	3,818	$	1,621	$	7,216	$	-
Residential real estate		4,013		1,957		1,946		166		2,292		-
Commercial real estate		1,801		959		193		117		2,559		-
Commercial		-		-		-		-		158		-
Consumer		99		99		-		-		121		-
Total	$	13,160	$	3,015	$	5,957	$	1,904	$	12,346	$	-

Impaired accruing TDRs:
Construction	$	4,189	$	3,479	$	710	$	18	$	4,041	$	25
Residential real estate		3,875		2,829		1,046		151		5,669		55
Commercial real estate		4,936		1,573		3,363		68		5,363		46
Commercial		-		-		-		-		-		-
Consumer		-		-		-		-		-		-
Total	$	13,000	$	7,881	$	5,119	$	237	$	15,073	$	126

Total impaired loans:
Construction	$	11,436	$	3,479	$	4,528	$	1,639	$	11,257	$	25
Residential real estate		7,888		4,786		2,992		317		7,961		55
Commercial real estate		6,737		2,532		3,556		185		7,922		46
Commercial		-		-		-		-		158		-
Consumer		99		99		-		-		121		-
Total	$	26,160	$	10,896	$	11,076	$	2,141	$	27,419	$	126

Troubled Debt Restructurings on Financing Receivables

The following tables provide a roll-forward for troubled debt restructurings as of March 31, 2017 and March 31, 2016.


	1/1/2017												3/31/2017
	TDR		New		Disbursements		Charge		Reclassifications/				TDR		Related
(Dollars in thousands)	Balance		TDRs		(Payments)		offs		Transfer In/(Out)		Payoffs		Balance		Allowance
For three months ended
March 31, 2017
Accruing TDRs
Construction	$	4,189	$	-	$	(10)	$	-	$	-	$	-	$	4,179	$	17
Residential real estate		3,875		-		(82)		(89)		-		-		3,704		148
Commercial real estate		4,936		-		(37)		-		-		-		4,899		84
Commercial		-		-		-		-		-		-		-		-
Consumer		-		-		-		-		-		-		-		-
Total	$	13,000	$	-	$	(129)	$	(89)	$	-	$	-	$	12,782	$	249

Nonaccrual TDRs
Construction	$	3,818	$	-	$	(190)	$	-	$	-	$	-	$	3,628	$	666
Residential real estate		1,603		-		(22)		-		-		-		1,581		134
Commercial real estate		83		-		-		-		-		-		83		-
Commercial		-		-		-		-		-		-		-		-
Consumer		-		-		-		-		-		-		-		-
Total	$	5,504	$	-	$	(212)	$	-	$	-	$	-	$	5,292	$	800

Total	$	18,504	$	-	$	(341)	$	(89)	$	-	$	-	$	18,074	$	1,049


	1/1/2016												3/31/2016
	TDR		New		Disbursements		Charge		Reclassifications/				TDR		Related
(Dollars in thousands)	Balance		TDRs		(Payments)		offs		Transfer In/(Out)		Payoffs		Balance		Allowance
For three months ended
March 31, 2016
Accruing TDRs
Construction	$	4,069	$	-	$	(77)	$	-	$	-	$	-	$	3,992	$	28
Residential real estate		5,686		-		(31)		-		-		-		5,655		112
Commercial real estate		5,740		-		(517)		(117)		-		-		5,106		552
Commercial		-		-		-		-		-		-		-		-
Consumer		-		-		-		-		-		-		-		-
Total	$	15,495	$	-	$	(625)	$	(117)	$	-	$	-	$	14,753	$	692

Nonaccrual TDRs
Construction	$	4,960	$	2,570	$	(691)	$	(241)	$	-	$	-	$	6,598	$	755
Residential real estate		445		-		(288)		-		-		-		157		11
Commercial real estate		-		-		-		-		-		-		-		-
Commercial		-		-		-		-		-		-		-		-
Consumer		23		-		-		-		-		-		23		-
Total	$	5,428	$	2,570	$	(979)	$	(241)	$	-	$	-	$	6,778	$	766

Total	$	20,923	$	2,570	$	(1,604)	$	(358)	$	-	$	-	$	21,531	$	1,458

The following tables provide information on loans that were modified and considered TDRs during the three months ended March 31, 2017 and March 31, 2016.


		Premodification		Postmodification
		outstanding		outstanding
	Number of	recorded		recorded		Related
(Dollars in thousands)	contracts	investment		investment		allowance
TDRs:
For three months ended
March 31, 2017
Construction	-	$	-	$	-	$	-
Residential real estate	-		-		-		-
Commercial real estate	1		760		755		-
Commercial	-		-		-		-
Consumer	-		-		-		-
Total	1	$	760	$	755	$	-

For three months ended
March 31, 2016
Construction	1	$	2,570	$	2,570	$	-
Residential real estate	-		-		-		-
Commercial real estate	-		-		-		-
Commercial	-		-		-		-
Consumer	-		-		-		-
Total	1	$	2,570	$	2,570	$	-

During the three months ended March 31, 2017, there was one TDR which was modified. The modification to this TDR consisted of a change in maturity date.

The following tables provide information on TDRs that defaulted during the three months ended March 31, 2017 and March 31, 2016. Generally, a loan is considered in default when principal or interest is past due 90 days or more.


	Number of	Recorded		Related
(Dollars in thousands)	contracts	investment		allowance
TDRs that subsequently defaulted:
For three months ended
March 31, 2017
Construction	-	$	-	$	-
Residential real estate	1		89		-
Commercial real estate	-		-		-
Commercial	-		-		-
Consumer	-		-		-
Total	1	$	89	$	-

For three months ended
March 31, 2016
Construction	1	$	241	$	-
Residential real estate	-		-		-
Commercial real estate	1		117		-
Commercial	-		-		-
Consumer	-		-		-
Total	2	$	358	$	-

Financing Receivable Credit Quality Indicators

The following tables provide information on loan risk ratings as of March 31, 2017 and December 31, 2016.


			Special
(Dollars in thousands)	Pass/Performing		Mention		Substandard		Doubtful		Total
March 31, 2017
Construction	$	80,284	$	4,164	$	7,050	$	-	$	91,498
Residential real estate		317,461		6,496		7,234		-		331,191
Commercial real estate		364,732		15,925		7,734		-		388,391
Commercial		73,304		814		71		-		74,189
Consumer		6,496		-		99		-		6,595
Total	$	842,277	$	27,399	$	22,188	$	-	$	891,864


			Special
(Dollars in thousands)	Pass/Performing		Mention		Substandard		Doubtful		Total
December 31, 2016
Construction	$	72,641	$	4,195	$	7,166	$	-	$	84,002
Residential real estate		312,242		6,646		6,880		-		325,768
Commercial real estate		363,461		10,939		8,281		-		382,681
Commercial		71,313		857		265		-		72,435
Consumer		6,540		-		99		-		6,639
Total	$	826,197	$	22,637	$	22,691	$	-	$	871,525

Past Due Financing Receivables

The following tables provide information on the aging of the loan portfolio as of March 31, 2017 and December 31, 2016.


		Accruing
				30-59 days			60-89 days			Greater than			Total
(Dollars in thousands)	Current			past due			past due			90 days			past due			Nonaccrual			Total
March 31, 2017
Construction	$	87,683		$	111		$	-		$	-		$	111		$	3,704		$	91,498
Residential real estate		324,573			1,062			1,286			-			2,348			4,270			331,191
Commercial real estate		385,788			1,449			390			108			1,947			656			388,391
Commercial		74,088			89			12			-			101			-			74,189
Consumer		6,465			13			8			10			31			99			6,595
Total	$	878,597		$	2,724		$	1,696		$	118		$	4,538		$	8,729		$	891,864
Percent of total loans		98.5	%		0.3	%		0.2	%		-	%		0.5	%		1.0	%		100.0	%


		Accruing
				30-59 days			60-89 days			Greater than			Total
(Dollars in thousands)	Current			past due			past due			90 days			past due			Nonaccrual			Total
December 31, 2016
Construction	$	80,079		$	-		$	105		$	-		$	105		$	3,818		$	84,002
Residential real estate		317,992			1,778			2,095			-			3,873			3,903			325,768
Commercial real estate		375,552			3,219			2,758			-			5,977			1,152			382,681
Commercial		72,272			19			134			10			163			-			72,435
Consumer		6,515			13			2			10			25			99			6,639
Total	$	852,410		$	5,029		$	5,094		$	20		$	10,143		$	8,972		$	871,525
Percent of total loans		97.8	%		0.6	%		0.6	%		-	%		1.2	%		1.0	%		100.0	%

Consolidated Allowance for Credit Losses on Financing Receivables


			Residential		Commercial
(Dollars in thousands)	Construction		real estate		real estate		Commercial		Consumer		Unallocated		Total
For three months ended
March 31, 2017
Allowance for credit losses:
Beginning Balance	$	2,787	$	1,953	$	2,610	$	1,145	$	231	$	-	$	8,726

Charge-offs		(29)		(223)		-		(65)		-		-		(317)
Recoveries		7		11		11		58		4		-		91
Net charge-offs		(22)		(212)		11		(7)		4		-		(226)

Provision		(475)		390		291		200		21		-		427
Ending Balance	$	2,290	$	2,131	$	2,912	$	1,338	$	256	$	-	$	8,927


			Residential		Commercial
(Dollars in thousands)	Construction		real estate		real estate		Commercial		Consumer		Unallocated		Total
For three months ended
March 31, 2016
Allowance for credit losses:
Beginning Balance	$	1,646	$	2,181	$	2,999	$	558	$	156	$	776	$	8,316

Charge-offs		(241)		(16)		(238)		(67)		(8)		-		(570)
Recoveries		6		34		-		65		8		-		113
Net charge-offs		(235)		18		(238)		(2)		-		-		(457)

Provision		342		(185)		496		29		21		(253)		450
Ending Balance	$	1,753	$	2,014	$	3,257	$	585	$	177	$	523	$	8,309