Loans (Tables)

9 Months Ended

Sep. 30, 2017

Composition of Loan Portfolio By Type of Loan

Set forth below is selected data relating to the composition of the loan portfolio by type of loan at September 30, 2017 and December 31, 2016.


	September 30, 2017			December 31, 2016
	(Dollars in Thousands)
Real estate loans:
One-to-four family first mortgages	$	165,926		$	147,962
Home equity lines of credit		34,995			35,684
Junior liens		1,402			1,452
Multi-family		37,321			34,284
Construction		25,594			39,255
Land		14,289			23,840
Farmland		37,262			47,796
Non-residential real estate		216,056			182,940

Total mortgage loans		532,845			513,213
Consumer loans		9,222			8,717
Commercial loans		88,515			88,907

Total other loans		97,737			97,624

Total loans		630,582			610,837
Deferred loan fees, net of cost		(380	)		(439	)
Less allowance for loan losses		(4,799	)		(6,112	)

Total loans, net	$	625,403		$	604,286

Allowance for Loan Loss Account by Loan

The following table provides a detail of the Company’s activity in the allowance for loan loss account by loan type for the nine month period ended September 30, 2017:


											Ending
	Balance		Charge offs			Recoveries		Provision			Balance
	12/31/2016		2017			2017		2017			9/30/2017
	(Dollars in Thousands)
One-to-four family mortgages	$	852		(49	)		9		(79	)		733
Home equity line of credit		260		—			10		(86	)		184
Junior liens		8		—			2		(4	)		6
Multi-family		412		—			417		(506	)		323
Construction		277		—			—		(146	)		131
Land		1,760		(2,608	)		559		1,535			1,246
Farmland		778		—			—		(409	)		369
Non-residential real estate		964		—			13		(215	)		762
Consumer loans		208		(200	)		70		68			146
Commercial loans		593		(224	)		267		263			899

Total	$	6,112		(3,081	)		1,347		421			4,799

The following table provides a detail of the Company’s activity in the allowance for loan loss account by loan type for the year ended December 31, 2016:


											Ending
	Balance		Charge offs			Recoveries		Provision			Balance
	12/31/2015		2016			2016		2016			12/31/2016
	(Dollars in Thousands)
One-to-four family mortgages	$	1,030		—			167		(345	)		852
Home equity line of credit		201		(30	)		14		75			260
Junior liens		8		—			14		(14	)		8
Multi-family		227		(421	)		—		606			412
Construction		377		—			—		(100	)		277
Land		1,379		—			—		381			1,760
Farmland		358		—			—		420			778
Non-residential real estate		1,139		—			10		(185	)		964
Consumer loans		358		(422	)		293		(21	)		208
Commercial loans		623		(595	)		141		424			593

Total	$	5,700		(1,468	)		639		1,241			6,112

Loan Balances by Loan Classification Allocated Between Past Due Performing and Non-performing

The table below presents past due and non-accrual balances at September 30, 2017 by loan classification allocated between performing and non-performing:


			30 - 89						Impaired Loans
	Currently		Days		Non-accrual		Special		Currently Performing
	Performing		Past Due		Loans		Mention		Substandard		Doubtful		Total
	(Dollars in Thousands)
One-to-four family mortgages	$	164,817		582		333		51		143		—	$	165,926
Home equity line of credit		34,433		—		401		—		161		—		34,995
Junior liens		1,398		4		—		—		—		—		1,402
Multi-family		37,321		—		—		—		—		—		37,321
Construction		25,594		—		—		—		—		—		25,594
Land		13,724		—		40		—		525		—		14,289
Farmland		35,626		—		455		1,147		34		—		37,262
Non-residential real estate		207,765		165		—		778		7,348		—		216,056
Consumer loans		9,066		3		5		—		148		—		9,222
Commercial loans		83,246		—		505		3,645		1,119		—		88,515

Total	$	612,990		754		1,739		5,621		9,478		—	$	630,582

The table below presents past due and non-accrual balances at December 31, 2016 by loan classification allocated between performing and non-performing:


			30 - 89		Non-				Impaired Loans
	Currently		Days		Accrual		Special		Currently Performing
	Performing		Past Due		Loans		Mention		Substandard		Doubtful		Total
	(Dollars in Thousands)
One-to-four family mortgages		145,069		896		270		744		983		—		147,962
Home equity line of credit		35,087		22		402		25		148		—		35,684
Junior liens		1,407		4		—		30		11		—		1,452
Multi-family		31,280		—		—		—		3,004		—		34,284
Construction		39,255		—		—		—		—		—		39,255
Land		15,581		—		7,675		35		549		—		23,840
Farmland		44,832		—		—		674		2,290		—		47,796
Non-residential real estate		172,395		—		208		3		10,334		—		182,940
Consumer loans		8,354		28		3		—		332		—		8,717
Commercial loans		84,913		261		516		603		2,614		—		88,907

Total		578,173		1,211		9,074		2,114		20,265		—		610,837

Allowance for Loan Losses and Recorded Investment in Loans by Portfolio Segment and Impairment Method

The following table presents the balance in the allowance for loan losses and the recorded investment in loans as of September 30, 2017 and December 31, 2016, by portfolio segment and based on the impairment method.


			Land
			Development /		Commercial		Residential
	Commercial		Construction		Real Estate		Real Estate		Consumer		Total
	(Dollars in Thousands)
September 30, 2017:
Allowance for loan losses:
Ending allowance balance attributable to loans:
Individually evaluated for impairment	$	267		—		19		—		36		322
Collectively evaluated for impairment		632		1,377		1,435		923		110		4,477

Total ending allowance balance	$	899		1,377		1,454		923		146		4,799

Loans:
Loans individually evaluated for impairment	$	1,624		565		7,837		1,038		153		11,217
Loans collectively evaluated for impairment		86,891		39,318		282,802		201,285		9,069		619,365

Total ending loans balance	$	88,515		39,883		290,639		202,323		9,222		630,582


			Land
			Development /		Commercial		Residential
	Commercial		Construction		Real Estate		Real Estate		Consumer		Total
	(Dollars in Thousands)
December 31, 2016:
Allowance for loan losses:
Ending allowance balance attributable to loans:
Individually evaluated for impairment	$	28		1,036		—		—		84		1,148
Collectively evaluated for impairment		565		1,001		2,154		1,120		124		4,964

Total ending allowance balance	$	593		2,037		2,154		1,120		208		6,112

Loans:
Loans individually evaluated for impairment	$	3,130		8,224		15,836		1,814		335		29,339
Loans collectively evaluated for impairment		85,777		54,871		249,184		183,284		8,382		581,498

Total ending loans balance	$	88,907		63,095		265,020		185,098		8,717		610,837

Summary of Company's Loans by Credit Risk Indicator and Related Allowance

A summary of the Company’s loans by credit risk indicator and the related allowance at September 30, 2017 and December 31, 2016 were as follows:


					Impaired Loans
September 30, 2017	Pass		Special Mention		Substandard		Doubtful		Total		Specific Allowance for Impairment		Allowance for Loans not Impaired
	(Dollars in Thousands)

One-to-four family mortgages	$	165,399		51		476		—		165,926		—		733
Home equity line of credit		34,433		—		562		—		34,995		—		184
Junior liens		1,402		—		—		—		1,402		—		6
Multi-family		37,321		—		—		—		37,321		—		323
Construction		25,594		—		—		—		25,594		—		131
Land		13,724		—		565		—		14,289		—		1,246
Farmland		35,626		1,147		489		—		37,262		17		352
Non-residential real estate		207,930		778		7,348		—		216,056		2		760
Consumer loans		9,069		—		153		—		9,222		36		110
Commercial loans		83,246		3,645		1,624		—		88,515		267		632

Total	$	613,744		5,621		11,217		—		630,582		322		4,477


					Impaired Loans
December 31, 2016	Pass		Special Mention		Substandard		Doubtful		Total		Specific Allowance for Impairment		Allowance for Loans not Impaired
	(Dollars in Thousands)

One-to-four family mortgages	$	145,965		744		1,253		—		147,962		—		852
Home equity line of credit		35,109		25		550		—		35,684		—		260
Junior liens		1,411		30		11		—		1,452		—		8
Multi-family		31,280		—		3,004		—		34,284		—		412
Construction		39,255		—		—		—		39,255		—		277
Land		15,581		35		8,224		—		23,840		1,036		724
Farmland		44,832		674		2,290		—		47,796		—		778
Non-residential real estate		172,395		3		10,542		—		182,940		—		964
Consumer loans		8,382		—		335		—		8,717		84		124
Commercial loans		85,174		603		3,130		—		88,907		28		565

Total	$	579,384		2,114		29,339		—		610,837		1,148		4,964

Impaired Loans by Classification Type

Impaired loans by classification type and the related valuation allowance amounts at September 30, 2017 were as follows:


	At September 30, 2017						For the nine month period ended September 30, 2017
	Recorded Investment		Unpaid Principal Balance		Related Allowance		Average Recorded Investment		Interest Income Recognized
	(Dollars in Thousands)
Impaired loans with no specific allowance
One-to-four family mortgages	$	476		476		—		1,480		26
Home equity line of credit		562		562		—		559		25
Junior liens		—		—		—		8		—
Multi-family		—		—		—		1,419		—
Construction		—		—		—		—		—
Land		565		565		—		918		35
Farmland		164		164		—		1,257		2
Non-residential real estate		7,328		7,328		—		9,452		312
Consumer loans		9		9		—		10		—
Commercial loans		1,125		1,125		—		1,745		35

Total		10,229		10,229		—		16,848		435

Impaired loans with a specific allowance
One-to-four family mortgages		—		—		—		—		—
Home equity line of credit		—		—		—		—		—
Junior liens		—		—		—		—		—
Multi-family		—		—		—		—		—
Construction		—		—		—		—		—
Land		—		—		—		5,008		—
Farmland		325		325		17		244		—
Non-residential real estate		20		20		2		110		2
Consumer loans		144		144		36		255		—
Commercial loans		499		499		267		464		16

Total		988		988		322		6,081		18

Total	$	11,217		11,217		322		22,929		453

Impaired loans by classification type and the related valuation allowance amounts at December 31, 2016 were as follows:


	At December 31, 2016						For the year ended December 31, 2016
	Recorded Investment		Unpaid Principal Balance		Related Allowance		Average Recorded Investment		Interest Income Recognized
	(Dollars in Thousands)
Impaired loans with no specific allowance
One-to-four family mortgages	$	1,253		1,253		—		1,470		67
Home equity line of credit		550		550		—		390		24
Junior liens		11		11		—		13		1
Multi-family		3,004		3,004		—		3,005		172
Construction		—		—		—		—		—
Land		1,553		2,513		—		7,868		38
Farmland		2,290		2,290		—		1,563		120
Non-residential real estate		10,542		10,542		—		9,363		485
Consumer loans		—		—		—		21		1
Commercial loans		2,865		2,865		—		3,168		112

Total		22,068		23,028		—		26,861		1,020

Impaired loans with a specific allowance
One-to-four family mortgages				—		—		452		—
Home equity line of credit		—		—		—		—		—
Junior liens		—		—		—		—		—
Multi-family		—		—		—		910		—
Construction		—		—		—		—		—
Land		6,671		6,671		1,036		1,811		485
Farmland		—		—		—		533		—
Non-residential real estate		—		—		—		—		—
Consumer loans		335		335		84		273		—
Commercial loans		265		265		28		754		24

Total		7,271		7,271		1,148		4,733		509

Total	$	29,339		30,299		1,148		31,594		1,529

Summary of the Activity in Loans Classified as TDRs

The following table provides the number of loans remaining in each category as of September 30, 2017 and December 31, 2016 that the Company had previously modified in a TDR:


	Number of Loans		Pre-Modification Outstanding Record Investment		Post Modification Outstanding Record Investment, net of related allowance
September 30, 2017
Non-residential real estate		3	$	3,371,435		3,371,435
December 31, 2016
Multi-family		3	$	815,273		815,273
Non-residential real estate		5		5,646,223		5,646,223