Loans Receivable and Allowance for Loan Losses |
NOTE 7 – LOANS RECEIVABLE AND ALLOWANCE FOR LOAN
LOSSES
The following table presents loans receivable as of
December 31, 2013 and 2012:
|
|
|
|
|
|
|
|
|
|
|
December 31, |
|
|
|
2013 |
|
|
2012 |
|
|
|
(in thousands) |
|
Construction
|
|
$ |
14,627 |
|
|
$ |
27,792 |
|
Commercial real estate
|
|
|
24,258 |
|
|
|
44,901 |
|
Commercial and industrial
|
|
|
5,814 |
|
|
|
11,153 |
|
Residential real estate
|
|
|
18,733 |
|
|
|
19,952 |
|
Manufactured housing
|
|
|
3,293 |
|
|
|
3,728 |
|
|
|
|
|
|
|
|
|
|
Total loans receivable covered under FDIC loss sharing
agreements (1)
|
|
|
66,725 |
|
|
|
107,526 |
|
|
|
|
Construction
|
|
|
36,901 |
|
|
|
28,897 |
|
Commercial real estate
|
|
|
1,835,186 |
|
|
|
835,488 |
|
Commercial and industrial
|
|
|
239,509 |
|
|
|
75,118 |
|
Mortgage warehouse
|
|
|
866 |
|
|
|
9,565 |
|
Manufactured housing
|
|
|
139,471 |
|
|
|
154,703 |
|
Residential real estate
|
|
|
145,188 |
|
|
|
109,430 |
|
Consumer
|
|
|
2,144 |
|
|
|
2,061 |
|
|
|
|
|
|
|
|
|
|
Total loans receivable not covered under FDIC loss sharing
agreements
|
|
|
2,399,265 |
|
|
|
1,215,262 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Total loans receivable
|
|
|
2,465,990 |
|
|
|
1,322,788 |
|
Deferred (fees) costs, net
|
|
|
(912 |
) |
|
|
1,679 |
|
Allowance for loan losses
|
|
|
(23,998 |
) |
|
|
(25,837 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
Loans receivable, net
|
|
$ |
2,441,080 |
|
|
$ |
1,298,630 |
|
|
|
|
|
|
|
|
|
|
(1) |
Loans that were acquired in the two
FDIC assisted transactions and are covered under loss sharing
agreements with the FDIC are referred to as “covered”
loans throughout these financial statements. |
Non-Covered Loans
The following table summarizes non-covered loans by class
and performance status as of December 31, 2013 and 2012:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2013 |
|
|
|
30-89 Days
Past Due (1) |
|
|
90 Or
More Days
Past Due (1) |
|
|
Total Past
Due Still
Accruing (1) |
|
|
Non-
Accrual |
|
|
Current (2) |
|
|
Purchased-
Credit-
Impaired
Loans (3) |
|
|
Total Loans (4) |
|
|
|
(in thousands) |
|
|
|
|
|
|
|
|
|
Commercial and industrial
|
|
$ |
10 |
|
|
$ |
0 |
|
|
$ |
10 |
|
|
$ |
123 |
|
|
$ |
237,453 |
|
|
$ |
1,923 |
|
|
$ |
239,509 |
|
Commercial real estate
|
|
|
0 |
|
|
|
0 |
|
|
|
0 |
|
|
|
9,924 |
|
|
|
1,788,144 |
|
|
|
37,118 |
|
|
|
1,835,186 |
|
Construction
|
|
|
0 |
|
|
|
0 |
|
|
|
0 |
|
|
|
2,049 |
|
|
|
33,922 |
|
|
|
930 |
|
|
|
36,901 |
|
Residential real estate
|
|
|
555 |
|
|
|
0 |
|
|
|
555 |
|
|
|
969 |
|
|
|
133,158 |
|
|
|
10,506 |
|
|
|
145,188 |
|
Consumer
|
|
|
0 |
|
|
|
0 |
|
|
|
0 |
|
|
|
0 |
|
|
|
1,728 |
|
|
|
416 |
|
|
|
2,144 |
|
Mortgage warehouse
|
|
|
0 |
|
|
|
0 |
|
|
|
0 |
|
|
|
0 |
|
|
|
866 |
|
|
|
0 |
|
|
|
866 |
|
Manufactured housing (5)
|
|
|
7,921 |
|
|
|
3,772 |
|
|
|
11,693 |
|
|
|
448 |
|
|
|
122,416 |
|
|
|
4,914 |
|
|
|
139,471 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
$ |
8,486 |
|
|
$ |
3,772 |
|
|
$ |
12,258 |
|
|
$ |
13,513 |
|
|
$ |
2,317,687 |
|
|
$ |
55,807 |
|
|
$ |
2,399,265 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2012 |
|
|
|
30-89 Days
Past Due (1) |
|
|
90 Or
More Days
Past Due (1) |
|
|
Total Past
Due Still
Accruing (1) |
|
|
Non-
Accrual |
|
|
Current (2) |
|
|
Purchased-
Credit-
Impaired
Loans (3) |
|
|
Total Loans (4) |
|
|
|
(in thousands) |
|
|
|
|
|
|
|
|
|
Commercial and industrial
|
|
$ |
38 |
|
|
$ |
0 |
|
|
$ |
38 |
|
|
$ |
288 |
|
|
$ |
72,715 |
|
|
$ |
2,077 |
|
|
$ |
75,118 |
|
Commercial real estate
|
|
|
1,437 |
|
|
|
0 |
|
|
|
1,437 |
|
|
|
17,770 |
|
|
|
770,508 |
|
|
|
45,773 |
|
|
|
835,488 |
|
Construction
|
|
|
0 |
|
|
|
0 |
|
|
|
0 |
|
|
|
2,423 |
|
|
|
25,022 |
|
|
|
1,452 |
|
|
|
28,897 |
|
Residential real estate
|
|
|
381 |
|
|
|
0 |
|
|
|
381 |
|
|
|
1,669 |
|
|
|
95,396 |
|
|
|
11,984 |
|
|
|
109,430 |
|
Consumer
|
|
|
0 |
|
|
|
0 |
|
|
|
0 |
|
|
|
56 |
|
|
|
1,486 |
|
|
|
519 |
|
|
|
2,061 |
|
Mortgage warehouse
|
|
|
0 |
|
|
|
0 |
|
|
|
0 |
|
|
|
0 |
|
|
|
9,565 |
|
|
|
0 |
|
|
|
9,565 |
|
Manufactured housing (5)
|
|
|
9,234 |
|
|
|
1,966 |
|
|
|
11,200 |
|
|
|
141 |
|
|
|
135,924 |
|
|
|
7,438 |
|
|
|
154,703 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
$ |
11,090 |
|
|
$ |
1,966 |
|
|
$ |
13,056 |
|
|
$ |
22,347 |
|
|
$ |
1,110,616 |
|
|
$ |
69,243 |
|
|
$ |
1,215,262 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
Includes past due loans that are
accruing interest because collection is considered probable. |
(2) |
Loans where next payment due is less
than 30 days from the report date. |
(3) |
Purchased-credit-impaired loans that
were aggregated into a pool are accounted for as a single asset
with a single composite interest rate and an aggregate expectation
of cash flows, and the past due status of the pools, or that of the
individual loans within the pools, is not meaningful. Because the
Bank recognizes interest income on each pool of loans, they are
considered to be performing. Purchased-credit-impaired loans that
are not in pools accrete interest when the timing and amount of
their expected cash flows are reasonably estimable, and are
reported as performing loans. For additional information about
purchased-credit-impaired loans, refer to refer to NOTE 3
“SIGNIFICANT ACCOUNTING POLICIES AND BASIS OF PRESENTATION
– Purchased Loans.” |
(4) |
Amounts exclude deferred costs and
fees and the allowance for loan losses. |
(5) |
Manufactured housing loans purchased
in 2010 are subject to cash reserves held at the Bank that are
used to fund past-due payments when the loan becomes 90 days or
more delinquent. Subsequent purchases are subject to varying
provisions in the event of borrowers’ delinquencies. |
Covered Loans
The following table summarizes covered loans by class and
performance status as of December 31, 2013 and 2012:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2013 |
|
|
|
30-89 Days
Past Due (1) |
|
|
90 Days
Or More
Past Due (1) |
|
|
Total Past
Due Still
Accruing (1) |
|
|
Non-
Accrual |
|
|
Current (2) |
|
|
Purchased-
Credit-
Impaired
Loans (3) |
|
|
Total
Loans (4) |
|
|
|
(in thousands) |
|
|
|
|
|
|
|
|
|
Commercial and industrial
|
|
$ |
295 |
|
|
$ |
0 |
|
|
$ |
295 |
|
|
$ |
2 |
|
|
$ |
3,172 |
|
|
$ |
2,345 |
|
|
$ |
5,814 |
|
Commercial real estate
|
|
|
245 |
|
|
|
0 |
|
|
|
245 |
|
|
|
1,691 |
|
|
|
13,586 |
|
|
|
8,736 |
|
|
|
24,258 |
|
Construction
|
|
|
0 |
|
|
|
0 |
|
|
|
0 |
|
|
|
3,382 |
|
|
|
1,967 |
|
|
|
9,278 |
|
|
|
14,627 |
|
Residential real estate
|
|
|
90 |
|
|
|
0 |
|
|
|
90 |
|
|
|
564 |
|
|
|
14,108 |
|
|
|
3,971 |
|
|
|
18,733 |
|
Manufactured housing
|
|
|
56 |
|
|
|
0 |
|
|
|
56 |
|
|
|
11 |
|
|
|
3,081 |
|
|
|
145 |
|
|
|
3,293 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
$ |
686 |
|
|
$ |
0 |
|
|
$ |
686 |
|
|
$ |
5,650 |
|
|
$ |
35,914 |
|
|
$ |
24,475 |
|
|
$ |
66,725 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2012 |
|
|
|
30- 89 Days
Past Due (1) |
|
|
90 Days
Or More
Past Due (1) |
|
|
Total Past
Due Still
Accruing (1) |
|
|
Non-
Accrual |
|
|
Current (2) |
|
|
Purchased-
Credit-
Impaired
Loans (3) |
|
|
Total
Loans (4) |
|
|
|
(in thousands) |
|
|
|
|
|
|
|
|
|
Commercial and industrial
|
|
$ |
220 |
|
|
$ |
0 |
|
|
$ |
220 |
|
|
$ |
100 |
|
|
$ |
8,404 |
|
|
$ |
2,429 |
|
|
$ |
11,153 |
|
Commercial real estate
|
|
|
0 |
|
|
|
0 |
|
|
|
0 |
|
|
|
3,712 |
|
|
|
20,859 |
|
|
|
20,330 |
|
|
|
44,901 |
|
Construction
|
|
|
0 |
|
|
|
0 |
|
|
|
0 |
|
|
|
5,244 |
|
|
|
6,472 |
|
|
|
16,076 |
|
|
|
27,792 |
|
Residential real estate
|
|
|
0 |
|
|
|
0 |
|
|
|
0 |
|
|
|
1,358 |
|
|
|
14,226 |
|
|
|
4,368 |
|
|
|
19,952 |
|
Manufactured housing
|
|
|
48 |
|
|
|
0 |
|
|
|
48 |
|
|
|
90 |
|
|
|
3,527 |
|
|
|
63 |
|
|
|
3,728 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
$ |
268 |
|
|
$ |
0 |
|
|
$ |
268 |
|
|
$ |
10,504 |
|
|
$ |
53,488 |
|
|
$ |
43,266 |
|
|
$ |
107,526 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
Includes past due loans that are
accruing interest because collection is considered probable. |
(2) |
Purchased loans from the FDIC with no
evidence of credit deterioration since origination. |
(3) |
Purchased-credit-impaired loans
aggregated into a pool are accounted for as a single asset with a
single composite interest rate and an aggregate expectation of cash
flows, the past due status of the pools, or that of the individual
loans within the pools, is not meaningful. Because the Bank
recognizes interest income on each pool of loans, they are
considered to be performing. Purchased-credit-impaired loans that
are not in pools accrete interest when the timing and amount of
their expected cash flows are reasonably estimable, and are
reported as performing loans. For additional information about
purchased-credit-impaired loans, refer to refer to NOTE 3
“SIGNIFICANT ACCOUNTING POLICIES AND BASIS OF PRESENTATION
– Purchased Loans” . |
(4) |
Amounts exclude deferred costs and
fees and allowance for loan losses. |
Allowance for Loan Losses and FDIC Loss Sharing
Receivable
Prospective losses incurred on covered loans are eligible for
partial reimbursement by the FDIC. Subsequent to the purchase date,
the expected cash flows on the covered loans are subject to
evaluation. Decreases in the present value of expected cash flows
are recognized by recording an allowance for loan losses with the
related provision for loan losses reduced for the amount
reimbursable by the FDIC. If the expected cash flows on the covered
loans increase such that a previously recorded impairment can be
reversed, the Bancorp records a reduction in the allowance for loan
losses with a related reduction in losses reimbursable by the FDIC.
Increases in expected cash flows of purchased loans and decreases
in expected cash flows of the FDIC loss sharing receivable, when
there are no previously recorded impairments, are considered
together and recognized over the remaining life of the loans as
interest income.
The following table presents changes in the allowance for loans
losses and the FDIC sharing receivable for the years ended
December 31, 3013, 2012 and 2011.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Allowance for Loan Losses
For The Years Ended December 31, |
|
|
|
2013 |
|
|
2012 |
|
|
2011 |
|
|
|
(in thousands) |
|
|
|
|
|
Beginning Balance
|
|
$ |
25,837 |
|
|
$ |
15,032 |
|
|
$ |
15,129 |
|
Provision for loan losses (1)
|
|
|
5,055 |
|
|
|
16,271 |
|
|
|
9,450 |
|
Charge-offs
|
|
|
(7,338 |
) |
|
|
(6,166 |
) |
|
|
(9,661 |
) |
Recoveries
|
|
|
444 |
|
|
|
700 |
|
|
|
114 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ending Balance
|
|
$ |
23,998 |
|
|
$ |
25,837 |
|
|
$ |
15,032 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FDIC Loss Sharing Receivable
For The Years Ended December 31, |
|
|
|
2013 |
|
|
2012 |
|
|
2011 |
|
|
|
(in thousands) |
|
|
|
|
|
Beginning Balance
|
|
$ |
12,343 |
|
|
$ |
13,077 |
|
|
$ |
16,702 |
|
Increased estimated cash flows (2)
|
|
|
2,819 |
|
|
|
2,001 |
|
|
|
1,955 |
|
Other activity, net (3)
|
|
|
1,610 |
|
|
|
3,838 |
|
|
|
1,965 |
|
Cash receipts from FDIC
|
|
|
(6,726 |
) |
|
|
(6,573 |
) |
|
|
(7,545 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Ending Balance
|
|
$ |
10,046 |
|
|
$ |
12,343 |
|
|
$ |
13,077 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Provision for loan losses
|
|
$ |
5,055 |
|
|
$ |
16,271 |
|
|
$ |
9,450 |
|
(2) Benefit attributable to FDIC loss share
arrangements
|
|
|
(2,819 |
) |
|
|
(2,001 |
) |
|
|
(1,955 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net amount reported as provision for loan losses
|
|
$ |
2,236 |
|
|
$ |
14,270 |
|
|
$ |
7,495 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(3) |
Includes external costs, such as
legal fees, real estate taxes and appraisal expenses, that qualify
for reimbursement under loss share arrangements. For 2012, includes
change in accounting estimate as described in “NOTE
3—SIGNIFICANT ACCOUNTING POLICIES AND BASIS OF
PRESENTATION.” |
Impaired Loans – Covered and Non-Covered
The following tables present a summary of impaired loans as of the
years ended December 31, 2013 and 2012.
Purchased-credit-impaired loans are considered to be performing and
are not included in the tables below.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2013 |
|
|
|
Recorded
Investment
Net of
Charge Offs |
|
|
Unpaid
Principal
Balance |
|
|
Related
Allowance |
|
|
Average
Recorded
Investment |
|
|
Interest
Income
Recognized |
|
|
|
(in thousands) |
|
With no related allowance recorded:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial and industrial
|
|
$ |
13,097 |
|
|
$ |
13,159 |
|
|
$ |
|
|
|
$ |
9,953 |
|
|
$ |
35 |
|
Commercial real estate
|
|
|
14,397 |
|
|
|
15,249 |
|
|
|
|
|
|
|
22,475 |
|
|
|
158 |
|
Construction
|
|
|
2,777 |
|
|
|
4,046 |
|
|
|
|
|
|
|
6,408 |
|
|
|
0 |
|
Consumer
|
|
|
0 |
|
|
|
0 |
|
|
|
|
|
|
|
90 |
|
|
|
0 |
|
Residential real estate
|
|
|
2,831 |
|
|
|
2,831 |
|
|
|
|
|
|
|
2,523 |
|
|
|
898 |
|
With an allowance recorded:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial and industrial
|
|
|
2,469 |
|
|
|
3,739 |
|
|
|
829 |
|
|
|
1,616 |
|
|
|
25 |
|
Commercial real estate
|
|
|
2,261 |
|
|
|
3,167 |
|
|
|
946 |
|
|
|
7,497 |
|
|
|
82 |
|
Construction
|
|
|
1,132 |
|
|
|
1,132 |
|
|
|
351 |
|
|
|
5,054 |
|
|
|
0 |
|
Consumer
|
|
|
64 |
|
|
|
64 |
|
|
|
17 |
|
|
|
48 |
|
|
|
5 |
|
Residential real estate
|
|
|
252 |
|
|
|
252 |
|
|
|
199 |
|
|
|
875 |
|
|
|
254 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
$ |
39,280 |
|
|
$ |
43,639 |
|
|
$ |
2,342 |
|
|
$ |
56,539 |
|
|
$ |
1,457 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2012 |
|
|
|
Recorded
Investment
Net of
Charge Offs |
|
|
Unpaid
Principal
Balance |
|
|
Related
Allowance |
|
|
Average
Recorded
Investment |
|
|
Interest
Income
Recognized |
|
|
|
(in thousands) |
|
With no related allowance recorded:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial and industrial
|
|
$ |
3,844 |
|
|
$ |
3,844 |
|
|
$ |
|
|
|
$ |
4,922 |
|
|
$ |
209 |
|
Commercial real estate
|
|
|
26,626 |
|
|
|
27,477 |
|
|
|
|
|
|
|
23,089 |
|
|
|
1,247 |
|
Construction
|
|
|
6,588 |
|
|
|
6,618 |
|
|
|
|
|
|
|
7,420 |
|
|
|
9 |
|
Consumer
|
|
|
101 |
|
|
|
101 |
|
|
|
|
|
|
|
130 |
|
|
|
1 |
|
Residential real estate
|
|
|
3,188 |
|
|
|
3,188 |
|
|
|
|
|
|
|
2,543 |
|
|
|
63 |
|
With an allowance recorded:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial and industrial
|
|
|
374 |
|
|
|
374 |
|
|
|
295 |
|
|
|
673 |
|
|
|
12 |
|
Commercial real estate
|
|
|
8,708 |
|
|
|
10,022 |
|
|
|
2,505 |
|
|
|
8,998 |
|
|
|
149 |
|
Construction
|
|
|
5,116 |
|
|
|
6,022 |
|
|
|
1,541 |
|
|
|
6,545 |
|
|
|
205 |
|
Consumer
|
|
|
100 |
|
|
|
100 |
|
|
|
14 |
|
|
|
43 |
|
|
|
6 |
|
Residential real estate
|
|
|
1,331 |
|
|
|
1,331 |
|
|
|
270 |
|
|
|
1,040 |
|
|
|
13 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
$ |
55,976 |
|
|
$ |
59,077 |
|
|
$ |
4,625 |
|
|
$ |
55,403 |
|
|
$ |
1,914 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Troubled Debt Restructurings
At December 31, 2013 and 2012, there were $4.6 million and
$6.1 million, respectively, in loans categorized as troubled debt
restructurings (“TDRs”). TDRs are reported as impaired
loans in the calendar year of their restructuring and are evaluated
to determine whether they should be placed on non-accrual status.
In subsequent years, a TDR may be returned to accrual status if it
satisfies a minimum six-month performance requirement; however, it
will remain classified as impaired. Generally, the Bancorp requires
sustained performance for nine months before returning a TDR to
accrual status.
Modification of purchased-credit-impaired loans that are accounted
for within loan pools in accordance with the accounting standards
for purchased-credit-impaired loans do not result in the removal of
these loans from the pool even if modifications would otherwise be
considered a TDR. Accordingly, as each pool is accounted for as a
single asset with a single composite interest rate and an aggregate
expectation of cash flows, modifications of loans within such pools
are not TDRs.
The following is an analysis of loans modified in a troubled debt
restructuring by type of concession at December 31, 2013 and
2012. There were no modifications that involved forgiveness of
debt.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2013 |
|
|
|
TDRs in
Compliance
with Their
Modified
Terms and
Accruing
Interest |
|
|
TDRs in
Compliance with
Their Modified
Terms and
Not
Accruing
Interest |
|
|
Total |
|
|
|
(in thousands) |
|
Extended under forbearance
|
|
$ |
0 |
|
|
$ |
0 |
|
|
$ |
0 |
|
Multiple extensions resulting from financial difficulty
|
|
|
0 |
|
|
|
0 |
|
|
|
0 |
|
Interest-rate reductions
|
|
|
790 |
|
|
|
448 |
|
|
|
1,238 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
$ |
790 |
|
|
$ |
448 |
|
|
$ |
1,238 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2012 |
|
|
|
TDRs in
Compliance
with Their
Modified
Terms and
Accruing
Interest |
|
|
TDRs in
Compliance with
Their Modified
Terms and
Not
Accruing
Interest |
|
|
Total |
|
|
|
(in thousands) |
|
Extended under forbearance
|
|
$ |
0 |
|
|
$ |
514 |
|
|
$ |
514 |
|
Multiple extensions resulting from financial difficulty
|
|
|
47 |
|
|
|
0 |
|
|
|
47 |
|
Interest rate reductions
|
|
|
792 |
|
|
|
141 |
|
|
|
933 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
$ |
839 |
|
|
$ |
655 |
|
|
$ |
1,494 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The following tables provide by class the number of loans modified
in troubled debt restructurings and recorded investments at
December 31, 2013 and 2012.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2013 |
|
|
|
TDRs in Compliance with
Their Modified Terms and
Accruing Interest |
|
|
TDRs in Compliance with Their
Modified Terms and Not
Accruing Interest |
|
|
|
Number
of Loans |
|
|
Recorded
Investment |
|
|
Number
of Loans |
|
|
Recorded
Investment |
|
|
|
(dollars in
thousands) |
|
Commercial and industrial
|
|
|
0 |
|
|
$ |
0 |
|
|
|
0 |
|
|
$ |
0 |
|
Commercial real estate
|
|
|
0 |
|
|
|
0 |
|
|
|
0 |
|
|
|
0 |
|
Construction
|
|
|
0 |
|
|
|
0 |
|
|
|
0 |
|
|
|
0 |
|
Manufactured housing
|
|
|
8 |
|
|
|
758 |
|
|
|
5 |
|
|
|
448 |
|
Residential real estate
|
|
|
0 |
|
|
|
0 |
|
|
|
0 |
|
|
|
0 |
|
Consumer
|
|
|
1 |
|
|
|
32 |
|
|
|
0 |
|
|
|
0 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total loans
|
|
|
9 |
|
|
$ |
790 |
|
|
|
5 |
|
|
$ |
448 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2012 |
|
|
|
TDRs in Compliance with
Their Modified Terms and
Accruing Interest |
|
|
TDRs in Compliance with Their
Modified Terms and Not
Accruing Interest |
|
|
|
Number
of Loans |
|
|
Recorded
Investment |
|
|
Number
of Loans |
|
|
Recorded
Investment |
|
|
|
(dollars in
thousands) |
|
Commercial and industrial
|
|
|
0 |
|
|
$ |
0 |
|
|
|
0 |
|
|
$ |
0 |
|
Commercial real estate
|
|
|
0 |
|
|
|
0 |
|
|
|
0 |
|
|
|
0 |
|
Construction
|
|
|
0 |
|
|
|
0 |
|
|
|
0 |
|
|
|
0 |
|
Manufactured housing
|
|
|
4 |
|
|
|
223 |
|
|
|
3 |
|
|
|
141 |
|
Residential real estate
|
|
|
1 |
|
|
|
564 |
|
|
|
1 |
|
|
|
67 |
|
Consumer
|
|
|
1 |
|
|
|
52 |
|
|
|
1 |
|
|
|
447 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total loans
|
|
|
6 |
|
|
$ |
839 |
|
|
|
5 |
|
|
$ |
655 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As of December 31, 2013 and 2012, there were no commitments to
lend additional funds to debtors whose terms have been modified in
TDRs.
For the year ended December 31, 2013, the recorded investment
of loans determined to be TDRs was $1.2 million, both before and
after restructuring. For the year ended December 31, 2012, the
recorded investment of loans determined to be TDRs was $1.5
million, both before and after restructuring. During the year
period ending December 31, 2013, five TDR loans defaulted with
a recorded investment of $0.4 million. During the year end
December 31, 2012, three TDR loans defaulted with a recorded
investment of $0.3 million. Since these loans were included in the
loan portfolio that is subject to the cash reserve, they will be
removed from the loan portfolio when they become ninety days past
due.
Loans modified in troubled debt restructurings are evaluated for
impairment. The nature and extent of impairment of TDRs, including
those which have experienced a subsequent default, is considered in
the determination of an appropriate level of allowance for credit
losses. There were no specific allowances resulting from TDR
modifications during 2013, compared to specific allowances of $0.1
million for 2012.
Credit Quality Indicators
Commercial and industrial, commercial real estate, residential real
estate and construction loans are based on an internally assigned
risk rating system which are assigned at the loan origination and
reviewed on a periodic or on an “as needed” basis.
Consumer, mortgage warehouse and manufactured housing loans are
evaluated based on the payment activity of the loan.
To facilitate the monitoring of credit quality within the
commercial and industrial, commercial real estate, construction,
and residential real estate classes, and for purposes of analyzing
historical loss rates used in the determination of the allowance
for loan losses for the respective portfolio class, the Bank
utilizes the following categories of risk ratings:
pass/satisfactory (includes risk rating 1 through 6), special
mention, substandard, doubtful, and loss. The risk rating
categories, which are derived from standard regulatory rating
definitions, are assigned upon initial approval of credit to
borrowers and updated periodically thereafter. Pass/satisfactory
ratings, which are assigned to those borrowers who do not have
identified potential or well-defined weaknesses and for whom there
is a high likelihood of orderly repayment, are updated periodically
based on the size and credit characteristics of the borrower. All
other categories are updated on a quarterly basis during the month
preceding the end of the calendar quarter. Consumer loans are
not assigned to a risk rating. While assigning risk ratings
involves judgment, the risk-rating process allows management to
identify riskier credits in a timely manner and allocate the
appropriate resources to managing the loans.
The risk rating grades are defined as follows:
“1” – Pass/Excellent
Loans rated 1 represent a credit extension of the highest quality.
The borrower’s historic (at least five years) cash flows
manifest extremely large and stable margins of coverage. Balance
sheets are conservative, well capitalized, and liquid. After
considering debt service for proposed and existing debt, projected
cash flows continue to be strong and provide ample coverage. The
borrower typically reflects broad geographic and product
diversification and has access to alternative financial
markets.
“2” – Pass/Superior
Loans rated 2 are those for which the borrower has a strong
financial condition, balance sheet, operations, cash flow, debt
capacity and coverage with ratios better than industry norms. The
borrowers of these loans exhibit a limited leverage position,
borrowers are virtually immune to local economies in stable growing
industries, and where management is well respected and the company
has ready access to public markets.
“3” – Pass/Strong
Loans rated 3 are those loans for which the borrower has above
average financial condition and flexibility; more than satisfactory
debt service coverage, balance sheet and operating ratios are
consistent with or better than industry peers, have little industry
risk, move in diversified markets and are experienced and competent
in their industry. These borrowers access to capital markets is
limited mostly to private sources, often secured, but the borrower
typically has access to a wide range of refinancing
alternatives.
“4” – Pass/Good
Loans rated 4 have a sound primary and secondary source of
repayment. The borrower may have access to alternative sources of
financing, bust sources are not as widely available as they are to
a higher grade borrower. These loans carry a normal level of risk,
with very low loss exposure. The borrower has the ability to
perform according to the terms of the credit facility. The margins
of cash flow coverage are satisfactory but vulnerable to more rapid
deterioration than the higher quality loans.
“5” – Satisfactory
Loans rated 5 are extended to borrowers who are determined to be a
reasonable credit risk and demonstrate the ability to repay the
debt from normal business operations. Risk factors may include
reliability of margins and cash flows, liquidity, dependence on a
single product or industry, cyclical trends, depth of management,
or limited access to alternative financing sources. The
borrower’s historical financial information may indicate
erratic performance, but current trends are positive and the
quality of financial information is adequate, but is not as
detailed and sophisticated as information found on higher grad
loans. If adverse circumstances arise, the impact on the borrower
may be significant.
“6” – Satisfactory/Bankable with
Care
Loans rated 6 are those for which the borrower has higher than
normal credit risk; however cash flow and asset values are
generally intact. These borrowers may exhibit declining financial
characteristics, which increasing leverage and decreasing liquidity
and may have limited resources and access to financial
alternatives. Signs of weakness in these borrowers may include
delinquent taxes, trade slowness and eroding profit margins.
“7” – Special Mention
Loans rated Special Mention are credit facilities that may have
potential developing weaknesses and deserve extra attention from
the account manager and other management personnel. In the event
that potential weaknesses are not corrected or mitigated,
deterioration in the ability of the borrower to repay the debt in
the future may occur. This grade is not assigned to loans that bear
certain peculiar risks normally associated with the type of
financing involved, unless circumstances have caused the risk to
increase to a level higher than would have been acceptable with the
credit was originally approved. Loans where significant actual, not
potential, weaknesses or problems are clearly evident are graded in
the category below.
“8” – Substandard
Loans are classified Substandard when the loans are inadequately
protected by the current sound worth and payment capacity of the
obligor or of the collateral pledged, if any. Loans so classified
must have a well-defined weakness or weaknesses that jeopardize the
liquidation of the debt and are characterized by the distinct
possibility that the Company will sustain some loss if the
weaknesses are not corrected.
“9” – Doubtful
The Bank assigns a doubtful rating to loans that have all the
attributes of a substandard rating with the added characteristic
that the weaknesses make collection or liquidation in full, on the
basis of currently existing facts, conditions, and values, highly
questionable and improbable. The possibility of loss is extremely
high, but because of certain important and reasonable specific
pending factors that may work to the advantage of and strengthen
the credit quality of the loan, its classification as an estimated
loss is deferred until its more exact status may be determined.
Pending factors may include a proposed merger or acquisition,
liquidation proceeding, capital injection, perfecting liens on
additional collateral or refinancing plans.
“10” – Loss
The Bank assigns a loss rating to loans considered uncollectible
and of such little value that their continuance as an active asset
is not warranted. Loss estimates in excess of 30% will result in a
loss classification. Amounts classified as loss are immediately
charged off.
Risk ratings are not established for home equity loans, consumer
loans, and installment loans, mainly because these portfolios
consist of a larger number of homogenous loans with smaller
balances. Instead, these portfolios are evaluated for risk mainly
based upon aggregate payment history through the monitoring of
delinquency levels and trends and are classified as performing and
nonperforming.
The following presents the credit quality tables as of
December 31, 2013 and 2012 for the non-covered loan
portfolio.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2013 |
|
|
|
Commercial
and
Industrial |
|
|
Commercial
Real Estate |
|
|
Construction |
|
|
Residential
Real Estate |
|
|
|
(in thousands) |
|
|
|
|
|
|
Pass/Satisfactory
|
|
$ |
228,748 |
|
|
$ |
1,808,804 |
|
|
$ |
34,822 |
|
|
$ |
142,588 |
|
Special Mention
|
|
|
10,314 |
|
|
|
12,760 |
|
|
|
29 |
|
|
|
940 |
|
Substandard
|
|
|
447 |
|
|
|
13,622 |
|
|
|
2,050 |
|
|
|
1,660 |
|
Doubtful
|
|
|
0 |
|
|
|
0 |
|
|
|
0 |
|
|
|
0 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
$ |
239,509 |
|
|
$ |
1,835,186 |
|
|
$ |
36,901 |
|
|
$ |
145,188 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consumer |
|
|
Mortgage
Warehouse |
|
|
Manufactured
Housing |
|
|
|
(in thousands) |
|
|
|
|
|
Performing
|
|
$ |
2,144 |
|
|
$ |
866 |
|
|
$ |
127,330 |
|
Non-performing (1)
|
|
|
0 |
|
|
|
0 |
|
|
|
12,141 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
$ |
2,144 |
|
|
$ |
866 |
|
|
$ |
139,471 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2012 |
|
|
|
Commercial
and
Industrial |
|
|
Commercial
Real Estate |
|
|
Construction |
|
|
Residential
Real Estate |
|
|
|
(in thousands) |
|
|
|
|
|
|
Pass/Satisfactory
|
|
$ |
70,955 |
|
|
$ |
794,187 |
|
|
$ |
26,020 |
|
|
$ |
105,490 |
|
Special Mention
|
|
|
3,836 |
|
|
|
18,737 |
|
|
|
454 |
|
|
|
1,017 |
|
Substandard
|
|
|
327 |
|
|
|
21,801 |
|
|
|
1,971 |
|
|
|
2,919 |
|
Doubtful
|
|
|
0 |
|
|
|
763 |
|
|
|
452 |
|
|
|
4 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
$ |
75,118 |
|
|
$ |
835,488 |
|
|
$ |
28,897 |
|
|
$ |
109,430 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consumer |
|
|
Mortgage
Warehouse |
|
|
Manufactured
Housing |
|
|
|
(in thousands) |
|
|
|
|
|
Performing
|
|
$ |
2,005 |
|
|
$ |
9,565 |
|
|
$ |
154,562 |
|
Non-performing (1)
|
|
|
56 |
|
|
|
0 |
|
|
|
141 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
$ |
2,061 |
|
|
$ |
9,565 |
|
|
$ |
154,703 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
Includes loans that are on
non-accrual status at December 31, 2013 and 2012. |
The following presents the credit quality tables as of
December 31, 2013 and 2012 for the covered loan
portfolio.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2013 |
|
|
|
Commercial
and
Industrial |
|
|
Commercial
Real Estate |
|
|
Construction |
|
|
Residential
Real Estate |
|
|
|
(in thousands) |
|
|
|
|
|
|
Pass/Satisfactory
|
|
$ |
3,688 |
|
|
$ |
14,330 |
|
|
$ |
1,967 |
|
|
$ |
14,137 |
|
Special Mention
|
|
|
223 |
|
|
|
2,989 |
|
|
|
0 |
|
|
|
455 |
|
Substandard
|
|
|
1,903 |
|
|
|
6,939 |
|
|
|
12,660 |
|
|
|
4,141 |
|
Doubtful
|
|
|
0 |
|
|
|
0 |
|
|
|
0 |
|
|
|
0 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
$ |
5,814 |
|
|
$ |
24,258 |
|
|
$ |
14,627 |
|
|
$ |
18,733 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Manufactured
Housing |
|
|
|
(in thousands) |
|
|
|
Performing
|
|
$ |
3,226 |
|
Non-performing (1)
|
|
|
67 |
|
|
|
|
|
|
Total
|
|
$ |
3,293 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2012 |
|
|
|
Commercial
and
Industrial |
|
|
Commercial
Real Estate |
|
|
Construction |
|
|
Residential
Real Estate |
|
|
|
(in thousands) |
|
|
|
|
|
|
Pass/Satisfactory
|
|
$ |
8,888 |
|
|
$ |
26,195 |
|
|
$ |
2,434 |
|
|
$ |
14,021 |
|
Special Mention
|
|
|
51 |
|
|
|
225 |
|
|
|
4,038 |
|
|
|
455 |
|
Substandard
|
|
|
2,214 |
|
|
|
18,481 |
|
|
|
21,320 |
|
|
|
5,476 |
|
Doubtful
|
|
|
0 |
|
|
|
0 |
|
|
|
0 |
|
|
|
0 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
$ |
11,153 |
|
|
$ |
44,901 |
|
|
$ |
27,792 |
|
|
$ |
19,952 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Manufactured
Housing |
|
|
|
(in thousands) |
|
|
|
Performing
|
|
$ |
3,638 |
|
Non-performing (1)
|
|
|
90 |
|
|
|
|
|
|
Total
|
|
$ |
3,728 |
|
|
|
|
|
|
(1) |
Includes loans that are on
non-accrual status at December 31, 2013 and 2012. |
The changes in the allowance for loan losses for the years ended
December 31, 2013 and 2012 and the loans and allowance for
loan losses by class and impairment method as of December 31,
are presented in the tables below. The amounts presented below for
the provision for loan losses do not include expected benefits
resulting from the FDIC loss share arrangements for the covered
loans.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Twelve months ended December 31, 2013
|
|
Commercial
and
Industrial |
|
|
Commercial
Real Estate |
|
|
Construction |
|
|
Residential
Real Estate |
|
|
Manufactured
Housing |
|
|
Consumer |
|
|
Mortgage
Warehouse |
|
|
Residual
Reserve |
|
|
Total |
|
|
|
(in thousands) |
|
Beginning Balance, January 1, 2013
|
|
$ |
1,477 |
|
|
$ |
15,439 |
|
|
$ |
3,991 |
|
|
$ |
3,233 |
|
|
$ |
750 |
|
|
$ |
154 |
|
|
$ |
71 |
|
|
$ |
722 |
|
|
$ |
25,837 |
|
Charge-offs
|
|
|
(1,387 |
) |
|
|
(3,358 |
) |
|
|
(2,096 |
) |
|
|
(410 |
) |
|
|
0 |
|
|
|
(87 |
) |
|
|
0 |
|
|
|
0 |
|
|
|
(7,338 |
) |
Recoveries
|
|
|
391 |
|
|
|
42 |
|
|
|
0 |
|
|
|
2 |
|
|
|
0 |
|
|
|
9 |
|
|
|
0 |
|
|
|
0 |
|
|
|
444 |
|
Provision for loan losses
|
|
|
2,157 |
|
|
|
3,582 |
|
|
|
490 |
|
|
|
(335 |
) |
|
|
(136 |
) |
|
|
54 |
|
|
|
(35 |
) |
|
|
(722 |
) |
|
|
5,055 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ending Balance, December 31, 2013
|
|
$ |
2,638 |
|
|
$ |
15,705 |
|
|
$ |
2,385 |
|
|
$ |
2,490 |
|
|
$ |
614 |
|
|
$ |
130 |
|
|
$ |
36 |
|
|
$ |
0 |
|
|
$ |
23,998 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Individually evaluated for impairment
|
|
$ |
15,566 |
|
|
$ |
16,658 |
|
|
$ |
3,909 |
|
|
$ |
3,083 |
|
|
$ |
0 |
|
|
$ |
64 |
|
|
$ |
0 |
|
|
|
|
|
|
$ |
39,280 |
|
Collectively evaluated for impairment
|
|
|
225,489 |
|
|
|
1,796,932 |
|
|
|
37,411 |
|
|
|
146,361 |
|
|
|
137,705 |
|
|
|
1,664 |
|
|
|
866 |
|
|
|
|
|
|
|
2,346,428 |
|
Loans acquired with credit deterioration
|
|
|
4,268 |
|
|
|
45,854 |
|
|
|
10,208 |
|
|
|
14,477 |
|
|
|
5,059 |
|
|
|
416 |
|
|
|
0 |
|
|
|
|
|
|
|
80,282 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
245,323 |
|
|
$ |
1,859,444 |
|
|
$ |
51,528 |
|
|
$ |
163,921 |
|
|
$ |
142,764 |
|
|
$ |
2,144 |
|
|
$ |
866 |
|
|
|
|
|
|
$ |
2,465,990 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Allowance for loan losses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Individually evaluated for impairment
|
|
$ |
829 |
|
|
$ |
946 |
|
|
$ |
351 |
|
|
$ |
199 |
|
|
$ |
0 |
|
|
$ |
17 |
|
|
$ |
0 |
|
|
$ |
0 |
|
|
$ |
2,342 |
|
Collectively evaluated for impairment
|
|
|
1,574 |
|
|
|
9,642 |
|
|
|
267 |
|
|
|
767 |
|
|
|
84 |
|
|
|
38 |
|
|
|
36 |
|
|
|
0 |
|
|
|
12,408 |
|
Loans acquired with credit deterioration
|
|
|
235 |
|
|
|
5,117 |
|
|
|
1,767 |
|
|
|
1,524 |
|
|
|
530 |
|
|
|
75 |
|
|
|
0 |
|
|
|
0 |
|
|
|
9,248 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
2,638 |
|
|
$ |
15,705 |
|
|
$ |
2,385 |
|
|
$ |
2,490 |
|
|
$ |
614 |
|
|
$ |
130 |
|
|
$ |
36 |
|
|
$ |
0 |
|
|
$ |
23,998 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Twelve months ended December 31, 2012
|
|
Commercial
and
Industrial |
|
|
Commercial
Real Estate |
|
|
Construction |
|
|
Residential
Real Estate |
|
|
Manufactured
Housing |
|
|
Consumer |
|
|
Mortgage
Warehouse |
|
|
Residual
Reserve |
|
|
Total |
|
|
|
(in thousands) |
|
Beginning Balance, January 1, 2012
|
|
$ |
1,441 |
|
|
$ |
7,029 |
|
|
$ |
4,656 |
|
|
$ |
844 |
|
|
$ |
18 |
|
|
$ |
61 |
|
|
$ |
929 |
|
|
$ |
54 |
|
|
$ |
15,032 |
|
Charge-offs
|
|
|
(522 |
) |
|
|
(2,462 |
) |
|
|
(2,507 |
) |
|
|
(649 |
) |
|
|
0 |
|
|
|
(26 |
) |
|
|
0 |
|
|
|
0 |
|
|
|
(6,166 |
) |
Recoveries
|
|
|
514 |
|
|
|
63 |
|
|
|
4 |
|
|
|
5 |
|
|
|
0 |
|
|
|
114 |
|
|
|
0 |
|
|
|
0 |
|
|
|
700 |
|
Provision for loan losses
|
|
|
44 |
|
|
|
10,809 |
|
|
|
1,838 |
|
|
|
3,033 |
|
|
|
732 |
|
|
|
5 |
|
|
|
(858 |
) |
|
|
668 |
|
|
|
16,271 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ending Balance, December 31, 2012
|
|
$ |
1,477 |
|
|
$ |
15,439 |
|
|
$ |
3,991 |
|
|
$ |
3,233 |
|
|
$ |
750 |
|
|
$ |
154 |
|
|
$ |
71 |
|
|
$ |
722 |
|
|
$ |
25,837 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Individually evaluated for impairment
|
|
$ |
4,218 |
|
|
$ |
35,334 |
|
|
$ |
11,704 |
|
|
$ |
4,519 |
|
|
$ |
0 |
|
|
$ |
201 |
|
|
$ |
0 |
|
|
|
|
|
|
$ |
55,976 |
|
Collectively evaluated for impairment
|
|
|
77,547 |
|
|
|
778,952 |
|
|
|
27,457 |
|
|
|
108,511 |
|
|
|
150,930 |
|
|
|
1,341 |
|
|
|
9,565 |
|
|
|
|
|
|
|
1,154,303 |
|
Loans acquired with credit deterioration
|
|
|
4,506 |
|
|
|
66,103 |
|
|
|
17,528 |
|
|
|
16,352 |
|
|
|
7,501 |
|
|
|
519 |
|
|
|
0 |
|
|
|
|
|
|
|
112,509 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
86,271 |
|
|
$ |
880,389 |
|
|
$ |
56,689 |
|
|
$ |
129,382 |
|
|
$ |
158,431 |
|
|
$ |
2,061 |
|
|
$ |
9,565 |
|
|
|
|
|
|
$ |
1,322,788 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Allowance for loan losses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Individually evaluated for impairment
|
|
$ |
295 |
|
|
$ |
2,505 |
|
|
$ |
1,541 |
|
|
$ |
270 |
|
|
$ |
0 |
|
|
$ |
14 |
|
|
$ |
0 |
|
|
$ |
0 |
|
|
$ |
4,625 |
|
Collectively evaluated for impairment
|
|
|
731 |
|
|
|
7,048 |
|
|
|
350 |
|
|
|
917 |
|
|
|
63 |
|
|
|
55 |
|
|
|
71 |
|
|
|
722 |
|
|
|
9,957 |
|
Loans acquired with credit deterioration
|
|
|
451 |
|
|
|
5,886 |
|
|
|
2,100 |
|
|
|
2,046 |
|
|
|
687 |
|
|
|
85 |
|
|
|
0 |
|
|
|
0 |
|
|
|
11,255 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
1,477 |
|
|
$ |
15,439 |
|
|
$ |
3,991 |
|
|
$ |
3,233 |
|
|
$ |
750 |
|
|
$ |
154 |
|
|
$ |
71 |
|
|
$ |
722 |
|
|
$ |
25,837 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The non-covered manufactured housing portfolio was purchased in
August 2010. A portion of the purchase price may be used to
reimburse the Bank under the specified terms in the Purchase
Agreement for defaults of the underlying borrower and other
specified items. At December 31, 2013 and 2012, funds
available for reimbursement, if necessary, were $3.1 million and
$3.5 million, respectively. Each quarter, these funds are evaluated
to determine if they would be sufficient to absorb probable
losses within the manufactured housing portfolio.
The following table presents the changes in accretable yield
related to purchased-credit-impaired loans:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, |
|
|
|
2013 |
|
|
2012 |
|
|
2011 |
|
|
|
(in thousands) |
|
Accretable yield balance, beginning of period
|
|
$ |
32,174 |
|
|
$ |
45,358 |
|
|
$ |
7,176 |
|
Additions resulting from acquisition
|
|
|
0 |
|
|
|
0 |
|
|
|
41,306 |
|
Accretion to interest income
|
|
|
(6,213 |
) |
|
|
(11,723 |
) |
|
|
(3,556 |
) |
Reclassification from nonaccretable difference and disposals,
net
|
|
|
(3,404 |
) |
|
|
(1,461 |
) |
|
|
432 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accretable yield balance, end of period
|
|
$ |
22,557 |
|
|
$ |
32,174 |
|
|
$ |
45,358 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|