| Loans, Notes, Trade and Other Receivables Disclosure [Text Block] |
NOTE 4. LOANS RECEIVABLE
Loans receivable consisted of the following:
| | | June 30, | | | December 31, | |
| | | 2020 | | | 2019 | |
| | | (In Thousands) | |
| Real estate loans: | | | | | | | | |
| Residential 1-4 family | | $ | 150,818 | | | $ | 157,898 | |
| Commercial real estate | | | 432,631 | | | | 434,025 | |
| | | | | | | | | |
| Other loans: | | | | | | | | |
| Home equity | | | 58,755 | | | | 56,414 | |
| Consumer | | | 20,231 | | | | 18,882 | |
| Commercial | | | 181,005 | | | | 113,319 | |
| | | | | | | | | |
| Total | | | 843,440 | | | | 780,538 | |
| | | | | | | | | |
| Deferred loan fees, net | | | (2,611 | ) | | | (1,303 | ) |
| Allowance for loan losses | | | (10,500 | ) | | | (8,600 | ) |
| Total loans, net | | $ | 830,329 | | | $ | 770,635 | |
Within the loan categories above, $11,457,000 and $13,602,000 was guaranteed by the United States Department of Agriculture Rural Development at June 30, 2020 and December 31, 2019, respectively. Also within the loan categories above, $14,618,000 and $5,701,000 was guaranteed by the United States Department of Agriculture Farm Service Agency at June 30, 2020 and December 31, 2019, respectively. In addition, $44,855,000 was guaranteed by the Small Business Administration ("SBA") under their Payroll Protection Program ("PPP") at June 30, 2020.
Allowance for loan losses activity was as follows:
| | | Residential | | | Commercial | | | Home | | | | | | | | | | | | | |
| | | 1-4 Family | | | Real Estate | | | Equity | | | Consumer | | | Commercial | | | Total | |
| | | (In Thousands) | |
| Allowance for loan losses: | | | | | | | | | | | | | | | | | | | | | | | | |
| Balance, April, 1 2020 | | $ | 1,301 | | | $ | 5,214 | | | $ | 477 | | | $ | 354 | | | $ | 1,904 | | | $ | 9,250 | |
| Charge-offs | | | - | | | | - | | | | - | | | | (3 | ) | | | (8 | ) | | | (11 | ) |
| Recoveries | | | - | | | | 2 | | | | - | | | | 3 | | | | 29 | | | | 34 | |
| Provision | | | 68 | | | | 880 | | | | 14 | | | | 17 | | | | 248 | | | | 1,227 | |
| Balance, June 30, 2020 | | $ | 1,369 | | | $ | 6,096 | | | $ | 491 | | | $ | 371 | | | $ | 2,173 | | | $ | 10,500 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Allowance for loan losses: | | | | | | | | | | | | | | | | | | | | | | | | |
| Balance, January 1, 2020 | | $ | 1,301 | | | $ | 4,826 | | | $ | 477 | | | $ | 284 | | | $ | 1,712 | | | $ | 8,600 | |
| Charge-offs | | | - | | | | (18 | ) | | | - | | | | (11 | ) | | | (18 | ) | | | (47 | ) |
| Recoveries | | | - | | | | 8 | | | | - | | | | 11 | | | | 31 | | | | 50 | |
| Provision | | | 68 | | | | 1,280 | | | | 14 | | | | 87 | | | | 448 | | | | 1,897 | |
| Balance, June 30, 2020 | | $ | 1,369 | | | $ | 6,096 | | | $ | 491 | | | $ | 371 | | | $ | 2,173 | | | $ | 10,500 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Balance, June 30, 2020 allocated to loans individually evaluated for impairment | | $ | 97 | | | $ | - | | | $ | - | | | $ | - | | | $ | 70 | | | $ | 167 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Balance, June 30, 2020 allocated to loans collectively evaluated for impairment | | $ | 1,272 | | | $ | 6,096 | | | $ | 491 | | | $ | 371 | | | $ | 2,103 | | | $ | 10,333 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Loans receivable: | | | | | | | | | | | | | | | | | | | | | | | | |
| Balance, June 30, 2020 | | $ | 150,818 | | | $ | 432,631 | | | $ | 58,755 | | | $ | 20,231 | | | $ | 181,005 | | | $ | 843,440 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Balance, June 30, 2020 of loans individually evaluated for impairment | | $ | 1,266 | | | $ | 3,922 | | | $ | 191 | | | $ | 198 | | | $ | 2,284 | | | $ | 7,861 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Balance, June 30, 2020 of loans collectively evaluated for impairment | | $ | 149,552 | | | $ | 428,709 | | | $ | 58,564 | | | $ | 20,033 | | | $ | 178,721 | | | $ | 835,579 | |
| | | Residential | | | Commercial | | | Home | | | | | | | | | | | | | |
| | | 1-4 Family | | | Real Estate | | | Equity | | | Consumer | | | Commercial | | | Total | |
| | | (In Thousands) | |
| Allowance for loan losses: | | | | | | | | | | | | | | | | | | | | | | | | |
| Balance, April, 1 2019 | | $ | 1,301 | | | $ | 3,923 | | | $ | 477 | | | $ | 197 | | | $ | 1,202 | | | $ | 7,100 | |
| Charge-offs | | | - | | | | - | | | | (75 | ) | | | (4 | ) | | | (2 | ) | | | (81 | ) |
| Recoveries | | | - | | | | 3 | | | | - | | | | 9 | | | | 22 | | | | 34 | |
| Provision | | | - | | | | 350 | | | | 75 | | | | 22 | | | | 250 | | | | 697 | |
| Balance, June 30, 2019 | | $ | 1,301 | | | $ | 4,276 | | | $ | 477 | | | $ | 224 | | | $ | 1,472 | | | $ | 7,750 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Allowance for loan losses: | | | | | | | | | | | | | | | | | | | | | | | | |
| Balance, January 1, 2019 | | $ | 1,301 | | | $ | 3,593 | | | $ | 477 | | | $ | 190 | | | $ | 1,039 | | | $ | 6,600 | |
| Charge-offs | | | - | | | | (20 | ) | | | (75 | ) | | | (13 | ) | | | (97 | ) | | | (205 | ) |
| Recoveries | | | - | | | | 9 | | | | - | | | | 15 | | | | 30 | | | | 54 | |
| Provision | | | - | | | | 694 | | | | 75 | | | | 32 | | | | 500 | | | | 1,301 | |
| Balance, June 30, 2019 | | $ | 1,301 | | | $ | 4,276 | | | $ | 477 | | | $ | 224 | | | $ | 1,472 | | | $ | 7,750 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Balance, June 30, 2019 allocated to loans individually evaluated for impairment | | $ | - | | | $ | - | | | $ | - | | | $ | - | | | $ | - | | | $ | - | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Balance, June 30, 2019 allocated to loans collectively evaluated for impairment | | $ | 1,301 | | | $ | 4,276 | | | $ | 477 | | | $ | 224 | | | $ | 1,472 | | | $ | 7,750 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Loans receivable: | | | | | | | | | | | | | | | | | | | | | | | | |
| Balance, June 30, 2019 | | $ | 145,148 | | | $ | 412,690 | | | $ | 55,582 | | | $ | 19,181 | | | $ | 121,048 | | | $ | 753,649 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Balance, June 30, 2019 of loans individually evaluated for impairment | | $ | 680 | | | $ | 1,156 | | | $ | 199 | | | $ | 132 | | | $ | 1,462 | | | $ | 3,629 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Balance, June 30, 2019 of loans collectively evaluated for impairment | | $ | 144,468 | | | $ | 411,534 | | | $ | 55,383 | | | $ | 19,049 | | | $ | 119,586 | | | $ | 750,020 | |
Internal classification of the loan portfolio was as follows:
| | | June 30, 2020 | |
| | | | | | | Special | | | | | | | | | | | | | | | | | |
| | | Pass | | | Mention | | | Substandard | | | Doubtful | | | Loss | | | Total | |
| | | (In Thousands) | |
| Real estate loans: | | | | | | | | | | | | | | | | | | | | | | | | |
| Residential 1-4 family | | $ | 110,754 | | | $ | - | | | $ | 1,200 | | | $ | - | | | $ | - | | | $ | 111,954 | |
| Residential 1-4 family construction | | | 38,527 | | | | - | | | | 337 | | | | - | | | | - | | | | 38,864 | |
| Commercial real estate | | | 315,953 | | | | 1,818 | | | | 2,863 | | | | - | | | | - | | | | 320,634 | |
| Commercial construction and development | | | 53,294 | | | | 94 | | | | - | | | | - | | | | - | | | | 53,388 | |
| Farmland | | | 57,298 | | | | 83 | | | | 1,175 | | | | 53 | | | | - | | | | 58,609 | |
| Other loans: | | | | | | | | | | | | | | | | | | | | | | | | |
| Home equity | | | 58,431 | | | | 133 | | | | 191 | | | | - | | | | - | | | | 58,755 | |
| Consumer | | | 20,033 | | | | - | | | | 198 | | | | | | | | - | | | | 20,231 | |
| Commercial | | | 120,323 | | | | 845 | | | | 1,014 | | | | - | | | | - | | | | 122,182 | |
| Agricultural | | | 56,729 | | | | 297 | | | | 1,366 | | | | 431 | | | | - | | | | 58,823 | |
| Total | | $ | 831,342 | | | $ | 3,270 | | | $ | 8,344 | | | $ | 484 | | | $ | - | | | $ | 843,440 | |
| | | December 31, 2019 | |
| | | | | | | Special | | | | | | | | | | | | | | | | | |
| | | Pass | | | Mention | | | Substandard | | | Doubtful | | | Loss | | | Total | |
| | | (In Thousands) | |
| Real estate loans: | | | | | | | | | | | | | | | | | | | | | | | | |
| Residential 1-4 family | | $ | 118,116 | | | $ | - | | | $ | 1,180 | | | $ | - | | | $ | - | | | $ | 119,296 | |
| Residential 1-4 family construction | | | 38,265 | | | | - | | | | 337 | | | | - | | | | - | | | | 38,602 | |
| Commercial real estate | | | 328,750 | | | | - | | | | 2,312 | | | | - | | | | - | | | | 331,062 | |
| Commercial construction and development | | | 52,620 | | | | - | | | | 50 | | | | - | | | | - | | | | 52,670 | |
| Farmland | | | 49,959 | | | | 108 | | | | 168 | | | | 58 | | | | - | | | | 50,293 | |
| Other loans: | | | | | | | | | | | | | | | | | | | | | | | | |
| Home equity | | | 56,039 | | | | 78 | | | | 297 | | | | - | | | | - | | | | 56,414 | |
| Consumer | | | 18,694 | | | | - | | | | 188 | | | | - | | | | - | | | | 18,882 | |
| Commercial | | | 71,868 | | | | 159 | | | | 707 | | | | 63 | | | | - | | | | 72,797 | |
| Agricultural | | | 39,347 | | | | 138 | | | | 570 | | | | 467 | | | | - | | | | 40,522 | |
| Total | | $ | 773,658 | | | $ | 483 | | | $ | 5,809 | | | $ | 588 | | | $ | - | | | $ | 780,538 | |
The following tables include information regarding delinquencies within the loan portfolio.
| | | June 30, 2020 | |
| | | Loans Past Due and Still Accruing | | | | | | | | | | | | | |
| | | | | | | 90 Days | | | | | | | | | | | | | | | | | |
| | | 30-89 Days | | | and | | | | | | | Non-Accrual | | | Current | | | Total | |
| | | Past Due | | | Greater | | | Total | | | Loans | | | Loans | | | Loans | |
| | | (In Thousands) | |
| Real estate loans: | | | | | | | | | | | | | | | | | | | | | | | | |
| Residential 1-4 family | | $ | 1,397 | | | $ | - | | | $ | 1,397 | | | $ | 832 | | | $ | 109,725 | | | $ | 111,954 | |
| Residential 1-4 family construction | | | - | | | | 427 | | | | 427 | | | | 337 | | | | 38,100 | | | | 38,864 | |
| Commercial real estate | | | 327 | | | | - | | | | 327 | | | | 939 | | | | 319,368 | | | | 320,634 | |
| Commercial construction and development | | | 26 | | | | - | | | | 26 | | | | - | | | | 53,362 | | | | 53,388 | |
| Farmland | | | 998 | | | | - | | | | 998 | | | | 1,255 | | | | 56,356 | | | | 58,609 | |
| Other loans: | | | | | | | | | | | | | | | | | | | | | | | | |
| Home equity | | | 67 | | | | - | | | | 67 | | | | 191 | | | | 58,497 | | | | 58,755 | |
| Consumer | | | 30 | | | | - | | | | 30 | | | | 198 | | | | 20,003 | | | | 20,231 | |
| Commercial | | | 345 | | | | 115 | | | | 460 | | | | 793 | | | | 120,929 | | | | 122,182 | |
| Agricultural | | | 883 | | | | 124 | | | | 1,007 | | | | 1,331 | | | | 56,485 | | | | 58,823 | |
| Total | | $ | 4,073 | | | $ | 666 | | | $ | 4,739 | | | $ | 5,876 | | | $ | 832,825 | | | $ | 843,440 | |
| | | December 31, 2019 | |
| | | Loans Past Due and Still Accruing | | | | | | | | | | | | | |
| | | | | | | 90 Days | | | | | | | | | | | | | | | | | |
| | | 30-89 Days | | | and | | | | | | | Non-Accrual | | | Current | | | Total | |
| | | Past Due | | | Greater | | | Total | | | Loans | | | Loans | | | Loans | |
| | | (In Thousands) | |
| Real estate loans: | | | | | | | | | | | | | | | | | | | | | | | | |
| Residential 1-4 family | | $ | 702 | | | $ | 4 | | | $ | 706 | | | $ | 618 | | | $ | 117,972 | | | $ | 119,296 | |
| Residential 1-4 family construction | | | 260 | | | | - | | | | 260 | | | | 337 | | | | 38,005 | | | | 38,602 | |
| Commercial real estate | | | 793 | | | | - | | | | 793 | | | | 583 | | | | 329,686 | | | | 331,062 | |
| Commercial construction and development | | | 72 | | | | - | | | | 72 | | | | 50 | | | | 52,548 | | | | 52,670 | |
| Farmland | | | 1,039 | | | | - | | | | 1,039 | | | | 476 | | | | 48,778 | | | | 50,293 | |
| Other loans: | | | | | | | | | | | | | | | | | | | | | | | | |
| Home equity | | | 420 | | | | - | | | | 420 | | | | 98 | | | | 55,896 | | | | 56,414 | |
| Consumer | | | 128 | | | | - | | | | 128 | | | | 156 | | | | 18,598 | | | | 18,882 | |
| Commercial | | | 484 | | | | - | | | | 484 | | | | 824 | | | | 71,489 | | | | 72,797 | |
| Agricultural | | | 702 | | | | 1,805 | | | | 2,507 | | | | 499 | | | | 37,516 | | | | 40,522 | |
| Total | | $ | 4,600 | | | $ | 1,809 | | | $ | 6,409 | | | $ | 3,641 | | | $ | 770,488 | | | $ | 780,538 | |
The following tables include information regarding impaired loans.
| | | June 30, 2020 | |
| | | | | | | Unpaid | | | | | |
| | | Recorded | | | Principal | | | Related | |
| | | Investment | | | Balance | | | Allowance | |
| | | (In Thousands) | |
| Real estate loans: | | | | | | | | | | | | |
| Residential 1-4 family | | $ | 929 | | | $ | 981 | | | $ | 97 | |
| Residential 1-4 family construction | | | 337 | | | | 387 | | | | - | |
| Commercial real estate | | | 2,573 | | | | 2,793 | | | | - | |
| Commercial construction and development | | | 94 | | | | 94 | | | | - | |
| Farmland | | | 1,255 | | | | 1,266 | | | | - | |
| Other loans: | | | | | | | | | | | | |
| Home equity | | | 191 | | | | 214 | | | | - | |
| Consumer | | | 198 | | | | 218 | | | | - | |
| Commercial | | | 793 | | | | 854 | | | | 70 | |
| Agricultural | | | 1,491 | | | | 1,757 | | | | - | |
| Total | | $ | 7,861 | | | $ | 8,564 | | | $ | 167 | |
| | | December 31, 2019 | |
| | | | | | | Unpaid | | | | | |
| | | Recorded | | | Principal | | | Related | |
| | | Investment | | | Balance | | | Allowance | |
| | | (In Thousands) | |
| Real estate loans: | | | | | | | | | | | | |
| Residential 1-4 family | | $ | 618 | | | $ | 657 | | | $ | - | |
| Residential 1-4 family construction | | | 337 | | | | 387 | | | | - | |
| Commercial real estate | | | 583 | | | | 766 | | | | - | |
| Commercial construction and development | | | 50 | | | | 225 | | | | - | |
| Farmland | | | 476 | | | | 513 | | | | - | |
| Other loans: | | | | | | | | | | | | |
| Home equity | | | 98 | | | | 115 | | | | - | |
| Consumer | | | 156 | | | | 169 | | | | - | |
| Commercial | | | 824 | | | | 887 | | | | 74 | |
| Agricultural | | | 499 | | | | 756 | | | | - | |
| Total | | $ | 3,641 | | | $ | 4,475 | | | $ | 74 | |
| | | Three Months Ended | | | Six Months Ended | |
| | | June 30, | | | June 30, | |
| | | 2020 | | | 2019 | | | 2020 | | | 2019 | |
| | | Average Recorded Investment | | | Average Recorded Investment | |
| | | (In Thousands) | | | (In Thousands) | |
| Real estate loans: | | | | | | | | | | | | | | | | |
| Residential 1-4 family | | $ | 833 | | | $ | 346 | | | $ | 773 | | | $ | 298 | |
| Residential 1-4 family construction | | | 337 | | | | 486 | | | | 337 | | | | 485 | |
| Commercial real estate | | | 1,772 | | | | 614 | | | | 1,578 | | | | 556 | |
| Commercial construction and development | | | 94 | | | | - | | | | 72 | | | | 7 | |
| Farmland | | | 1,152 | | | | 584 | | | | 865 | | | | 238 | |
| Other loans: | | | | | | | | | | | | | | | | |
| Home equity | | | 164 | | | | 316 | | | | 145 | | | | 345 | |
| Consumer | | | 189 | | | | 130 | | | | 177 | | | | 130 | |
| Commercial | | | 750 | | | | 781 | | | | 809 | | | | 525 | |
| Agricultural | | | 1,136 | | | | 822 | | | | 995 | | | | 376 | |
| Total | | $ | 6,427 | | | $ | 4,079 | | | $ | 5,751 | | | $ | 2,960 | |
Interest income recognized on impaired loans for the three and six months ended June 30, 2020 and 2019 is considered insignificant. Interest payments received on a cash basis related to impaired loans were $458,000 and $394,000 for June 30, 2020 and December 31, 2019, respectively.
As of June 30, 2020 and December 31, 2019, there were troubled debt restructured (“TDR”) loans of $2,132,000 and $246,000, respectively.
During the three months ended June 30, 2020, there were two new TDR loans. During the six months ended June 30, 2020 there were a total of three new TDR loans. The recorded investment at time of restructure was $94,000 for a commercial construction and development loan, $1,634,000 for a commercial real estate loan and $160,000 for an agricultural loan. No charge-offs were incurred and the loans are on accrual status. The recorded investments were $94,000, $1,634,000 and $160,000, respectively at June 30, 2020. There were no new TDR loans during the three or six months ended June 30, 2019.
There were no loans modified as TDR’s that defaulted during the three and six months ended June 30, 2020 where the default occurred within 12 months of restructuring. A default for purposes of this disclosure is a TDR loan in which the borrower is 90 days past due or results in the foreclosure and repossession of the applicable collateral.
As of June 30, 2020, the Company had no commitments to lend additional funds to loan customers whose terms had been modified in troubled debt restructures.
The Company has offered borrowers accommodations due to the impact from COVID-19. As of June 30, 2020, there were 222 loans totaling $77,730,000 deferring payments for up to 90 days. In addition, approximately 93 borrowers, representing $47,983,000 in loans were approved for up to six-months interest only payments as of June 30, 2020.
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