Loans and Allowance for Credit Losses (Tables)

6 Months Ended

Jun. 30, 2019


(Dollars in thousands)	June 30, 2019		December 31, 2018
Construction	$	134,145	$	127,572
Residential real estate		430,020		429,560
Commercial real estate		559,568		523,427
Commercial		108,615		107,522
Consumer		7,947		7,274
Total loans		1,240,295		1,195,355
Allowance for credit losses		(10,305)		(10,343)
Total loans, net	$	1,229,990	$	1,185,012

Allowance for Credit Losses on Financing Receivables


			Residential		Commercial
(Dollars in thousands)	Construction		real estate		real estate		Commercial		Consumer		Total
June 30, 2019
Loans individually evaluated for impairment	$	1,494	$	6,761	$	13,794	$	311	$	—	$	22,360
Loans collectively evaluated for impairment		132,651		423,259		545,774		108,304		7,947		1,217,935
Total loans	$	134,145	$	430,020	$	559,568	$	108,615	$	7,947	$	1,240,295

Allowance for credit losses allocated to:
Loans individually evaluated for impairment	$	152	$	230	$	272	$	7	$	—	$	661
Loans collectively evaluated for impairment		2,291		1,925		3,095		2,050		283		9,644
Total allowance	$	2,443	$	2,155	$	3,367	$	2,057	$	283	$	10,305


			Residential		Commercial
(Dollars in thousands)	Construction		real estate		real estate		Commercial		Consumer		Total
December 31, 2018
Loans individually evaluated for impairment	$	2,893	$	8,553	$	13,532	$	340	$	—	$	25,318
Loans collectively evaluated for impairment		124,679		421,007		509,895		107,182		7,274		1,170,037
Total loans	$	127,572	$	429,560	$	523,427	$	107,522	$	7,274	$	1,195,355

Allowance for credit losses allocated to:
Loans individually evaluated for impairment	$	320	$	301	$	104	$	36	$	—	$	761
Loans collectively evaluated for impairment		2,342		2,052		2,973		1,913		302		9,582
Total allowance	$	2,662	$	2,353	$	3,077	$	1,949	$	302	$	10,343

Impaired Financing Receivables



			Recorded		Recorded				June 30, 2019
	Unpaid		investment		investment				Quarter-to-date		Average		Interest
	principal		with no		with an		Related		average recorded		recorded		recorded
(Dollars in thousands)	balance		allowance		allowance		allowance		investment		investment		investment
June 30, 2019
Impaired nonaccrual loans:
Construction	$	1,581		—		1,449		152		1,515		2,153		—
Residential real estate		3,035		2,549		—		—		2,730		3,034		—
Commercial real estate		10,949		8,956		1,327		247		9,613		9,466		—
Commercial		425		—		311		7		314		319		—
Consumer		—		—		—		—		—		—		—
Total	$	15,990	$	11,505	$	3,087	$	406	$	14,172	$	14,972	$	—

Impaired accruing TDRs:
Construction	$	45	$	45	$	—	$	—	$	47	$	48	$	8
Residential real estate		4,212		1,228		2,984		230		4,219		4,263		81
Commercial real estate		3,511		2,822		689		25		3,516		3,533		66
Commercial		—		—		—		—		—		—		—
Consumer		—		—		—		—		—		—		—
Total	$	7,768	$	4,095	$	3,673	$	255	$	7,782	$	7,844	$	155

Total impaired loans:
Construction	$	1,626	$	45	$	1,449	$	152	$	1,562	$	2,201	$	8
Residential real estate		7,247		3,777		2,984		230		6,949		7,297		81
Commercial real estate		14,460		11,778		2,016		272		13,129		12,999		66
Commercial		425		—		311		7		314		319		—
Consumer		—		—		—		—		—		—		—
Total	$	23,758	$	15,600	$	6,760	$	661	$	21,954	$	22,816	$	155



			Recorded		Recorded				June 30, 2018
	Unpaid		investment		investment				Quarter-to-date		Average		Interest
	principal		with no		with an		Related		average recorded		recorded		income
(Dollars in thousands)	balance		allowance		allowance		allowance		investment		investment		recognized
December 31, 2018
Impaired nonaccrual loans:
Construction	$	3,219	$	127	$	2,715	$	320	$	2,982	$	2,987	$	—
Residential real estate		4,281		2,605		1,494		118		1,590		1,504		—
Commercial real estate		10,029		9,307		67		67		1,853		1,286		—
Commercial		445		—		340		36		332		344		—
Consumer		—		—		—		—		—		—		—
Total	$	17,974	$	12,039	$	4,616	$	541	$	6,757	$	6,121	$	—

Impaired accruing TDRs:
Construction	$	51	$	51	$	—	$	—	$	291	$	1,634	$	13
Residential real estate		4,454		1,440		3,014		183		4,839		4,565		46
Commercial real estate		4,158		1,286		2,872		37		4,541		4,596		41
Commercial		—		—		—		—		—		—		—
Consumer		—		—		—		—		—		—		—
Total	$	8,663	$	2,777	$	5,886	$	220	$	9,671	$	10,795	$	100

Total impaired loans:
Construction	$	3,270	$	178	$	2,715	$	320	$	3,273	$	4,621	$	13
Residential real estate		8,735		4,045		4,508		301		6,429		6,069		46
Commercial real estate		14,187		10,593		2,939		104		6,394		5,882		41
Commercial		445		—		340		36		332		344		—
Consumer		—		—		—		—		—		—		—
Total	$	26,637	$	14,816	$	10,502	$	761	$	16,428	$	16,916	$	100

Troubled Debt Restructurings on Financing Receivables


	1/1/2019												6/30/2019
	TDR		New		Disbursements		Charge-		Reclassifications/				TDR		Related
(Dollars in thousands)	Balance		TDRs		(Payments)		offs		Transfer In/(Out)		Payoffs		Balance		Allowance
For six months ended
June 30, 2019
Accruing TDRs
Construction	$	51	$	—	$	(6)	$	—	$	—	$	—	$	45	$	—
Residential real estate		4,454		—		(45)		—		—		(197)		4,212		230
Commercial real estate		4,158		—		(647)		—		—		—		3,511		25
Commercial		—		—		—		—		—		—		—		—
Consumer		—		—		—		—		—		—		—		—
Total	$	8,663	$	—	$	(698)	$	—	$	—	$	(197)	$	7,768	$	255

Nonaccrual TDRs
Construction	$	2,798	$	—	$	(1,346)	$	(3)	$	—	$	—	$	1,449	$	152
Residential real estate		—		—		—		—		—		—		—		—
Commercial real estate		—		—		—		—		—		—		—		—
Commercial		320		—		(9)		—		—		—		311		7
Consumer		—		—		—		—		—		—		—		—
Total	$	3,118	$	—	$	(1,355)	$	(3)	$	—	$	—	$	1,760	$	159

Total	$	11,781	$	—	$	(2,053)	$	(3)	$	—	$	(197)	$	9,528	$	414


	1/1/2018												6/30/2018
	TDR		New		Disbursements		Charge-		Reclassifications/				TDR		Related
(Dollars in thousands)	Balance		TDRs		(Payments)		offs		Transfer In/(Out)		Payoffs		Balance		Allowance
For six months ended
June 30, 2018
Accruing TDRs
Construction	$	3,972	$	—	$	(6)	$	(379)	$	—	$	(2,600)	$	987	$	—
Residential real estate		4,536		—		(42)		—		(154)		(237)		4,103		—
Commercial real estate		4,818		—		(69)		—		—		(219)		4,530		—
Commercial		—		—		—		—		—		—		—		—
Consumer		—		—		—		—		—		—		—		—
Total	$	13,326	$	—	$	(117)	$	(379)	$	(154)	$	(3,056)	$	9,620	$	—

Nonaccrual TDRs
Construction	$	2,878	$	—	$	(40)	$	—	$	—	$	—	$	2,838	$	392
Residential real estate		—		—		—		—		154		—		154		—
Commercial real estate		83		—		—		—		—		—		83		—
Commercial		337		—		(4)		—		—		—		333		29
Consumer		—		—		—		—		—		—		—		—
Total	$	3,298	$	—	$	(44)	$	—	$	154	$	—	$	3,408	$	421

Total	$	16,624	$	—	$	(161)	$	(379)	$	—	$	(3,056)	$	13,028	$	421

Troubled Debt Restructurings That Defaulted On Financing Receivables


	Number of	Recorded		Related
(Dollars in thousands)	contracts	investment		allowance
TDRs that subsequently defaulted:
For six months ended
June 30, 2019
Construction	—	$	—	$	—
Residential real estate	—		—		—
Commercial real estate	—		—		—
Commercial	—		—		—
Consumer	—		—		—
Total	—	$	—	$	—

For six months ended
June 30, 2018
Construction	1	$	379	$	—
Residential real estate	1		154		—
Commercial real estate	—		—		—
Commercial	—		—		—
Consumer	—		—		—
Total	2	$	533	$	—

Financing Receivable Credit Quality Indicators


					Special
(Dollars in thousands)	Pass/Performing		Pass/Watch		Mention		Substandard		Doubtful		Total
June 30, 2019
Construction	$	104,892	$	25,633	$	2,153	$	1,467	$	—	$	134,145
Residential real estate		390,307		32,098		3,878		3,737		—		430,020
Commercial real estate		426,909		111,664		5,749		15,246		—		559,568
Commercial		88,611		19,335		324		345		—		108,615
Consumer		7,528		416		—		3		—		7,947
Total	$	1,018,247	$	189,146	$	12,104	$	20,798	$	—	$	1,240,295


					Special
(Dollars in thousands)	Pass/Performing		Pass/Watch		Mention		Substandard		Doubtful		Total
December 31, 2018
Construction	$	93,977	$	30,735	$	—	$	2,860	$	—	$	127,572
Residential real estate		386,553		33,739		3,769		5,499		—		429,560
Commercial real estate		389,219		113,873		4,515		15,820		—		523,427
Commercial		90,777		15,727		642		376		—		107,522
Consumer		6,805		466		—		3		—		7,274
Total	$	967,331	$	194,540	$	8,926	$	24,558	$	—	$	1,195,355

Past Due Financing Receivables


	Accruing
				30‑59 days			60‑89 days			Greater than			Total
(Dollars in thousands)	Current			past due			past due			90 days			past due			Nonaccrual			Total
June 30, 2019
Construction	$	132,478		$	—		$	218		$	—		$	218		$	1,449		$	134,145
Residential real estate		423,119			3,088			1,112			152			4,352			2,549			430,020
Commercial real estate		545,125			1,657			2,225			278			4,160			10,283			559,568
Commercial		107,534			471			290			9			770			311			108,615
Consumer		7,925			1			21			—			22			—			7,947
Total	$	1,216,181		$	5,217		$	3,866		$	439		$	9,522		$	14,592		$	1,240,295
Percent of total loans		98.1	%		0.4	%		0.3	%		—	%		0.7	%		1.2	%		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, 2018
Construction	$	124,535		$	195		$	—		$	—		$	195		$	2,842		$	127,572
Residential real estate		423,732			1,384			206			139			1,729			4,099			429,560
Commercial real estate		512,252			253			1,548			—			1,801			9,374			523,427
Commercial		107,089			83			10			—			93			340			107,522
Consumer		7,238			30			6			—			36			—			7,274
Total	$	1,174,846		$	1,945		$	1,770		$	139		$	3,854		$	16,655		$	1,195,355
Percent of total loans		98.3	%		0.2	%		0.1	%		—	%		0.3	%		1.4	%		100.0	%

Consolidated Allowance for Credit Losses on Financing Receivables



			Residential		Commercial
(Dollars in thousands)	Construction		real estate		real estate		Commercial		Consumer		Total
For three months ended
June 30, 2019
Allowance for credit losses:
Beginning Balance	$	2,657	$	2,433	$	3,057	$	2,009	$	262	$	10,418

Charge-offs		(3)		(300)		—		(81)		(23)		(407)
Recoveries		4		3		8		77		2		94
Net charge-offs		1		(297)		8		(4)		(21)		(313)

Provision		(215)		19		302		52		42		200
Ending Balance	$	2,443	$	2,155	$	3,367	$	2,057	$	283	$	10,305


			Residential		Commercial
(Dollars in thousands)	Construction		real estate		real estate		Commercial		Consumer		Total
For three months ended
June 30, 2018
Allowance for credit losses:
Beginning Balance	$	2,541	$	2,359	$	2,643	$	2,027	$	217	$	9,787

Charge-offs		—		(41)		—		(126)		(14)		(181)
Recoveries		6		73		8		10		—		97
Net charge-offs		6		32		8		(116)		(14)		(84)

Provision		46		(241)		194		299		120		418
Ending Balance	$	2,593	$	2,150	$	2,845	$	2,210	$	323	$	10,121


			Residential		Commercial
(Dollars in thousands)	Construction		real estate		real estate		Commercial		Consumer		Total
For six months ended
June 30, 2019
Allowance for credit losses:
Beginning Balance	$	2,662	$	2,353	$	3,077	$	1,949	$	302	$	10,343

Charge-offs		(3)		(423)		—		(162)		(29)		(617)
Recoveries		7		11		107		152		2		279
Net charge-offs		4		(412)		107		(10)		(27)		(338)

Provision		(223)		214		183		118		8		300
Ending Balance	$	2,443	$	2,155	$	3,367	$	2,057	$	283	$	10,305


			Residential		Commercial
(Dollars in thousands)	Construction		real estate		real estate		Commercial		Consumer		Total
For six months ended
June 30, 2018
Allowance for credit losses:
Beginning Balance	$	2,460	$	2,284	$	2,594	$	2,241	$	202	$	9,781

Charge-offs		(379)		(179)		—		(126)		(24)		(708)
Recoveries		15		86		18		22		—		141
Net charge-offs		(364)		(93)		18		(104)		(24)		(567)

Provision		497		(41)		233		73		145		907
Ending Balance	$	2,593	$	2,150	$	2,845	$	2,210	$	323	$	10,121