NOTE 3 - LOANS (Tables)

9 Months Ended

Sep. 30, 2021

Receivables [Abstract]

composition of loans receivable and loans held-for-sale

The composition of loans receivable and loans held-for-sale is as follows:

(In thousands)		September 30, 2021			December 31, 2020
Residential 1-4 family	$	368,801		$	352,001
Residential 5+ multifamily		46,237			37,058
Construction of residential 1-4 family		15,429			8,814
Home equity lines of credit		24,001			27,804
Residential real estate		454,468			425,677
Commercial		314,820			310,841
Construction of commercial		47,145			31,722
Commercial real estate		361,965			342,563
Farm land		3,409			3,198
Vacant land		13,698			14,079
Real estate secured		833,540			785,517
Commercial and industrial ex PPP Loans		167,528			140,516
PPP Loans		40,652			86,632
Total Commercial and industrial		208,180			227,148
Municipal		18,061			21,512
Consumer		11,152			7,687
Loans receivable, gross		1,070,933			1,041,864
Deferred loan origination fees, net		(314	)		(372	)
Allowance for loan losses		(13,168	)		(13,754	)
Loans receivable, net	$	1,057,451		$	1,027,738
Loans held-for-sale
Residential 1-4 family	$	639		$	2,735

composition of loans receivable by risk rating grade

The composition of loans receivable by risk rating grade is as follows:

(in thousands)	Pass		Special mention		Substandard		Doubtful		Loss		Total
September 30, 2021
Residential 1-4 family	$	361,116	$	4,139	$	3,546	$	-	$	-	$	368,801
Residential 5+ multifamily		44,484		83		1,670		-		-		46,237
Construction of residential 1-4 family		15,301		128		-		-		-		15,429
Home equity lines of credit		23,706		209		86		-		-		24,001
Residential real estate		444,607		4,559		5,302		-		-		454,468
Commercial		274,004		5,654		35,162		-		-		314,820
Construction of commercial		47,145		-		-		-		-		47,145
Commercial real estate		321,149		5,654		35,162		-		-		361,965
Farm land		1,610		1,223		576		-		-		3,409
Vacant land		13,621		42		35		-		-		13,698
Real estate secured		780,987		11,478		41,075		-		-		833,540
Commercial and industrial		205,140		500		2,540		-		-		208,180
Municipal		18,061		-		-		-		-		18,061
Consumer		11,132		1		19		-		-		11,152
Loans receivable, gross	$	1,015,320	$	11,979	$	43,634	$	-	$	-	$	1,070,933

(in thousands)	Pass		Special mention		Substandard		Doubtful		Loss		Total
December 31, 2020
Residential 1-4 family	$	342,243	$	5,615	$	4,143	$	-	$	-	$	352,001
Residential 5+ multifamily		35,272		90		1,696		-		-		37,058
Construction of residential 1-4 family		8,814		-		-		-		-		8,814
Home equity lines of credit		27,393		257		154		-		-		27,804
Residential real estate		413,722		5,962		5,993		-		-		425,677
Commercial		276,866		15,565		18,410		-		-		310,841
Construction of commercial		31,493		-		229		-		-		31,722
Commercial real estate		308,359		15,565		18,639		-		-		342,563
Farm land		1,612		-		1,586		-		-		3,198
Vacant land		13,992		50		37		-		-		14,079
Real estate secured		737,685		21,577		26,255		-		-		785,517
Commercial and industrial		224,906		1,271		632		339		-		227,148
Municipal		21,512		-		-		-		-		21,512
Consumer		7,660		-		27		-		-		7,687
Loans receivable, gross	$	991,763	$	22,848	$	26,914	$	339	$	-	$	1,041,864

composition of loans receivable by delinquency status

The composition of loans receivable by delinquency status is as follows:

			Past due
									180		30		Accruing
(in thousands)									days		days		90 days
			30-59		60-89		90-179		and		and		and		Non-
	Current		days		days		days		over		over		over		accrual
September 30, 2021
Residential 1-4 family	$	368,034	$	167	$	84	$	442	$	74	$	767	$	-	$	1,235
Residential 5+ multifamily		45,376		-		-		-		861		861		-		861
Construction of residential 1-4 family		15,429		-		-		-		-		-		-		-
Home equity lines of credit		23,831		105		14		-		51		170		-		86
Residential real estate		452,670		272		98		442		986		1,798		-		2,182
Commercial		314,342		200		24		-		254		478		-		1,954
Construction of commercial		47,145		-		-		-		-		-		-		-
Commercial real estate		361,487		200		24		-		254		478		-		1,954
Farm land		3,279		130		-		-		-		130		-		576
Vacant land		13,663		35		-		-		-		35		-		35
Real estate secured		831,099		637		122		442		1,240		2,441		-		4,747
Commercial and industrial		207,792		289		53		-		46		388		11		243
Municipal		18,061		-		-		-		-		-		-		-
Consumer		11,108		4		40		-		-		44		-		-
Loans receivable, gross	$	1,068,060	$	930	$	215	$	442	$	1,286	$	2,873	$	11	$	4,990

			Past due
									180		30		Accruing
(in thousands)									days		days		90 days
			30-59		60-89		90-179		and		and		and		Non-
	Current		days		days		days		over		over		over		accrual
December 31, 2020
Residential 1-4 family	$	349,382	$	1,419	$	308	$	673	$	219	$	2,619	$	-	$	1,508
Residential 5+ multifamily		36,197		-		-		-		861		861		-		861
Construction of residential 1-4 family		8,814		-		-		-		-		-		-		-
Home equity lines of credit		27,522		157		9		-		116		282		-		154
Residential real estate		421,915		1,576		317		673		1,196		3,762		-		2,523
Commercial		307,927		1,855		530		95		434		2,914		-		2,544
Construction of commercial		31,722		-		-		-		-		-		-		-
Commercial real estate		339,649		1,855		530		95		434		2,914		-		2,544
Farm land		2,594		154		450		-		-		604		-		158
Vacant land		14,079		-		-		-		-		-		-		37
Real estate secured		778,237		3,585		1,297		768		1,630		7,280		-		5,262
Commercial and industrial		224,496		2,148		457		1		46		2,652		12		374
Municipal		21,512		-		-		-		-		-		-		-
Consumer		7,677		10		-		-		-		10		-		-
Loans receivable, gross	$	1,031,922	$	5,743	$	1,754	$	769	$	1,676	$	9,942	$	12	$	5,636

Changes in the allowance for loan losses

Changes in the allowance for loan losses are as follows:

	Three months ended September 30, 2021												Three months ended September 30, 2020
(in thousands)	Beginning balance		Provision (Benefit)			Charge- offs			Reco- veries		Ending balance		Beginning balance		Provision (Benefit)			Charge- offs			Reco- veries		Ending balance
Residential 1-4 family	$	2,377	$	393		$	(35	)	$	5	$	2,740	$	3,048	$	69		$	(11	)	$	1	$	3,107
Residential 5+ multifamily		545		156			-			-		701		589		14			-			-		603
Construction of residential 1-4 family		95		41			-			-		136		87		10			-			-		97
Home equity lines of credit		190		26			(20	)		-		196		283		(8	)		-			-		275
Residential real estate		3,207		616			(55	)		5		3,773		4,007		85			(11	)		1		4,082
Commercial		6,212		(165	)		-			119		6,166		5,160		317			(14	)		1		5,464
Construction of commercial		668		118			-			-		786		205		195			-			-		400
Commercial real estate		6,880		(47	)		-			119		6,952		5,365		512			(14	)		1		5,864
Farm land		32		(1	)		-			-		31		60		5			-			-		65
Vacant land		87		(1	)		-			1		87		182		(11	)		-			-		171
Real estate secured		10,206		567			(55	)		125		10,843		9,614		591			(25	)		2		10,182
Commercial and industrial		1,256		73			-			3		1,332		1,515		(44	)		-			1		1,472
Municipal		32		(1	)		-			-		31		36		5			-			-		41
Consumer		66		62			(19	)		6		115		74		40			(41	)		7		80
Unallocated		1,148		(301	)		-			-		847		1,132		94			-			-		1,226
Totals	$	12,708	$	400		$	(74	)	$	134	$	13,168	$	12,371	$	686		$	(66	)	$	10	$	13,001

	Nine months ended September 30, 2021													Nine months ended September 30, 2020
(in thousands)	Beginning balance		Provision (Benefit)			Charge- offs			Reco- veries			Ending balance		Beginning balance		Provision (Benefit)			Charge- offs			Reco- veries		Ending balance
Residential 1-4 family	$	2,646	$	129		$	(44	)	$	9		$	2,740	$	2,393	$	716		$	(11	)	$	9	$	3,107
Residential 5+ multifamily		686		15			-			-			701		446		199			(42	)		-		603
Construction of residential 1-4 family		65		71			-			-			136		75		22			-			-		97
Home equity lines of credit		252		(36	)		(20	)		-			196		197		78			-			-		275
Residential real estate		3,649		179			(64	)		9			3,773		3,111		1,015			(53	)		9		4,082
Commercial		6,546		(509	)		(7	)		136			6,166		3,742		1,719			(17	)		20		5,464
Construction of commercial		596		208			(18	)		-			786		104		296			-			-		400
Commercial real estate		7,142		(301	)		(25	)		136			6,952		3,846		2,015			(17	)		20		5,864
Farm land		59		(28	)		-			-			31		47		18			-			-		65
Vacant land		180		(94	)		-			1			87		71		100			-			-		171
Real estate secured		11,030		(244	)		(89	)		146			10,843		7,075		3,148			(70	)		29		10,182
Commercial and industrial		1,397		17			(131	)		49			1,332		1,145		326			-			1		1,472
Municipal		43		(12	)		-			-			31		46		(5	)		-			-		41
Consumer		77		82			(34	)		(10	)		115		60		72			(66	)		14		80
Unallocated		1,207		(360	)		-			-			847		569		657			-			-		1,226
Totals	$	13,754	$	(517	)	$	(254	)	$	185		$	13,168	$	8,895	$	4,198		$	(136	)	$	44	$	13,001

composition of loans receivable and the allowance for loan losses

The composition of loans receivable and the allowance for loan losses is as follows:

(in thousands)	Collectively evaluated				Individually evaluated				Total portfolio
		Loans		Allowance		Loans		Allowance		Loans		Allowance
September 30, 2021
Residential 1-4 family	$	365,721	$	2,737	$	3,080	$	3	$	368,801	$	2,740
Residential 5+ multifamily		45,283		701		954		-		46,237		701
Construction of residential 1-4 family		15,429		136		-		-		15,429		136
Home equity lines of credit		23,915		196		86		-		24,001		196
Residential real estate		450,348		3,770		4,120		3		454,468		3,773
Commercial		310,947		6,123		3,873		43		314,820		6,166
Construction of commercial		47,145		786		-		-		47,145		786
Commercial real estate		358,092		6,909		3,873		43		361,965		6,952
Farm land		2,833		31		576		-		3,409		31
Vacant land		13,663		87		35		-		13,698		87
Real estate secured		824,936		10,797		8,604		46		833,540		10,843
Commercial and industrial		207,859		1,288		321		44		208,180		1,332
Municipal		18,061		31		-		-		18,061		31
Consumer		11,134		115		18		-		11,152		115
Unallocated allowance		-		847		-		-		-		847
Totals	$	1,061,990	$	13,078	$	8,943	$	90	$	1,070,933	$	13,168

(in thousands)	Collectively evaluated				Individually evaluated				Total portfolio
		Loans		Allowance		Loans		Allowance		Loans		Allowance
December 31, 2020
Residential 1-4 family	$	347,695	$	2,445	$	4,306	$	201	$	352,001	$	2,646
Residential 5+ multifamily		36,094		686		964		-		37,058		686
Construction of residential 1-4 family		8,814		65		-		-		8,814		65
Home equity lines of credit		27,650		232		154		20		27,804		252
Residential real estate		420,253		3,428		5,424		221		425,677		3,649
Commercial		305,193		6,298		5,648		248		310,841		6,546
Construction of commercial		31,722		596		-		-		31,722		596
Commercial real estate		336,915		6,894		5,648		248		342,563		7,142
Farm land		3,040		59		158		-		3,198		59
Vacant land		13,912		178		167		2		14,079		180
Real estate secured		774,120		10,559		11,397		471		785,517		11,030
Commercial and industrial		226,662		1,223		486		174		227,148		1,397
Municipal		21,512		43		-		-		21,512		43
Consumer		7,661		59		26		18		7,687		77
Unallocated allowance		-		1,207		-		-		-		1,207
Totals	$	1,029,955	$	13,091	$	11,909	$	663	$	1,041,864	$	13,754

credit quality segments of loans receivable and the allowance for loan losses

The credit quality segments of loans receivable and the allowance for loan losses are as follows:

September 30, 2021 (in thousands)	Collectively evaluated				Individually evaluated				Total portfolio
		Loans		Allowance		Loans		Allowance		Loans	Allowance
Performing loans	$	1,025,195	$	9,490	$	-	$	-	$	1,025,195	$	9,490
Potential problem loans 1		36,795		2,741		-		-		36,795		2,741
Impaired loans		-		-		8,943		90		8,943		90
Unallocated allowance		-		847		-		-		-		847
Totals	$	1,061,990	$	13,078	$	8,943	$	90	$	1,070,933	$	13,168

December 31, 2020 (in thousands)	Collectively evaluated				Individually evaluated				Total portfolio
		Loans		Allowance		Loans		Allowance		Loans	Allowance
Performing loans	$	1,011,757	$	10,424	$	-	$	-	$	1,011,757	$	10,424
Potential problem loans 1		18,198		1,460		-		-		18,198		1,460
Impaired loans		-		-		11,909		663		11,909		663
Unallocated allowance		-		1,207		-		-		-		1,207
Totals	$	1,029,955	$	13,091	$	11,909	$	663	$	1,041,864	$	13,754

Certain data with respect to loans individually evaluated for impairment

A specific valuation allowance is established for the impairment amount of each impaired loan, calculated using the present value of expected cash flows or fair value of collateral, in accordance with the most likely means of recovery. Certain data with respect to loans individually evaluated for impairment is as follows:

	Impaired loans with specific allowance										Impaired loans with no specific allowance
(in thousands)	Loan balance							Specific		Income	Loan balance							Income
		Book		Note		Average		allowance		recognized		Book		Note		Average		recognized
September 30, 2021
Residential	$	45	$	47	$	1,120	$	3	$	2	$	3,989	$	4,404	$	3,642	$	52
Home equity lines of credit		-		-		22		-		-		86		127		156		-
Residential real estate		45		47		1,142		3		2		4,075		4,531		3,798		52
Commercial		1,007		1,033		1,921		43		33		2,866		3,377		3,002		47
Construction of commercial		-		-		-		-		-		-		-		-		-
Farm land		-		-		-		-		-		576		756		415		-
Vacant land		-		-		73		-		-		35		39		52		-
Real estate secured		1,052		1,080		3,136		46		35		7,552		8,703		7,267		99
Commercial and industrial		221		228		336		44		3		100		270		91		-
Consumer		-		-		8		-		-		18		18		15		1
Totals	$	1,273	$	1,308	$	3,480	$	90	$	38	$	7,670	$	8,991	$	7,373	$	100

Note: The income recognized is for the nine month period ended September 30, 2021.

	Impaired loans with specific allowance										Impaired loans with no specific allowance
(in thousands)	Loan balance							Specific		Income	Loan balance							Income
		Book		Note		Average		allowance		recognized		Book		Note		Average		recognized
September 30, 2020
Residential	$	3,854	$	3,972	$	4,034	$	383	$	67	$	1,959	$	2,335	$	1,912	$	20
Home equity lines of credit		75		75		77		14		-		158		507		111		1
Residential real estate		3,929		4,047		4,111		397		67		2,117		2,842		2,023		21
Commercial		3,099		3,148		3,401		270		104		1,298		1,940		978		31
Construction of commercial		-		-		-		-		-		-		-		-		-
Farm land		-		-		-		-		-		166		322		177		-
Vacant land		38		40		40		3		-		132		148		136		7
Real estate secured		7,066		7,235		7,552		670		171		3,713		5,252		3,314		59
Commercial and industrial		824		827		422		380		3		52		205		59		2
Consumer		30		30		33		18		1		-		-		-		-
Totals	$	7,920	$	8,092	$	8,007	$	1,068	$	175	$	3,765	$	5,457	$	3,373	$	61

Note: The income recognized is for the nine month period ended September 30, 2020.

	Impaired loans with specific allowance										Impaired loans with no specific allowance
(in thousands)	Loan balance										Loan balance
		Recorded Investment		Note		Average		Specific allowance		Income recognized		Recorded Investment		Note		Average		Income recognized
December 31, 2020
Residential	$	2,971	$	3,040	$	3,862	$	201	$	72	$	2,299	$	2,676	$	1,993	$	27
Home equity lines of credit		75		75		76		20		-		79		117		103		-
Residential real estate		3,046		3,115		3,938		221		72		2,378		2,793		2,096		27
Commercial		3,058		3,117		3,325		248		132		2,590		3,203		1,139		91
Construction of commercial		-		-		-		-		-		-		-		-		-
Farm land		-		-		-		-		-		158		319		173		-
Vacant land		37		40		39		2		-		130		145		134		9
Real estate secured		6,141		6,272		7,302		471		204		5,256		6,460		3,542		127
Commercial and industrial		416		424		482		174		4		70		283		58		2
Consumer		26		26		31		18		2		-		-		-		-
Totals	$	6,583	$	6,722	$	7,815	$	663	$	210	$	5,326	$	6,743	$	3,600	$	129