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Note 5 - Concentration of Credit Risk
3 Months Ended
Mar. 31, 2020
Notes to Financial Statements  
Concentration Risk Disclosure [Text Block]

Note 5: Concentration of Credit Risk

 

Under the California Financial Code, credit extended to any one person owing to a commercial bank at any one time shall not exceed the following limitations: (a) unsecured loans shall not exceed 15 percent of the sum of the shareholders' equity, allowance for credit losses (loans), capital notes, and debentures of the bank, or (b) secured and unsecured loans in all shall not exceed 25 percent of the sum of the shareholders' equity, allowance for credit losses (loans), capital notes, and debentures of the bank. At March 31, 2020, the Bank did not have credit extended to any one entity exceeding these limits. At March 31, 2020, the Bank had 31 lending relationships each with aggregate amounts of $5 million or more. The Company has significant credit arrangements that are secured by real estate collateral. In addition to real estate loans outstanding as disclosed in Note 4, the Company had loan commitments related to real estate loans of $41,106 thousand and $43,129 thousand at March 31, 2020 and December 31, 2019, respectively. The Company requires collateral on all real estate loans with loan-to-value ratios at origination generally no greater than 75% on commercial real estate loans and no greater than 80% on residential real estate loans. At March 31, 2020, the Bank held corporate bonds in 98 issuing entities that exceeded $5 million for each issuer.