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Loans and Allowance for Loan Losses (Tables)
 9 Months Ended
Sep. 30, 2014
Receivables [Abstract]  
Summary of Loans
Loans are stated at the principal amount outstanding net of unearned discounts, unearned income and allowance for loan losses.  Unearned income includes deferred loan origination fees reduced by loan origination costs and is amortized to interest income over the life of the related loan using methods that approximated the effective interest rate method.  Interest on substantially all loans is credited to income based on the principal amount outstanding. A summary of loans at September 30, 2014 and December 31, 2013 follows (in thousands):

 
September 30,
2014
 
December 31,
2013
Construction and land development
$
23,113

 
$
25,321

Agricultural real estate
109,695

 
109,376

1-4 Family residential properties
183,612

 
184,158

Multifamily residential properties
53,186

 
50,174

Commercial real estate
375,256

 
357,726

Loans secured by real estate
744,862

 
726,755

Agricultural loans
60,145

 
64,055

Commercial and industrial loans
211,220

 
168,227

Consumer loans
15,054

 
14,579

All other loans
8,276

 
9,094

Gross loans
1,039,557

 
982,710

Less:
 

 
 

Net deferred loan fees, premiums and discounts
229

 
420

Allowance for loan losses
13,705

 
13,249

Net loans
$
1,025,623

 
$
969,041
Allowance for Loan Losses and Recorded Investment in Loans
following tables present the balance in the allowance for loan losses and the recorded investment in loans based on portfolio segment and impairment method for the three and nine-months ended September 30, 2014 and 2013 and for the year ended December 31, 2013 (in thousands):
 
Commercial/ Commercial Real Estate
 
Agricultural/ Agricultural Real Estate
 
Residential 
Real Estate
 
Consumer
 
Unallocated
 
Total
Three months ended September 30, 2014
 
 
 
 
 
 
 
 
 
 
Allowance for loan losses:
 
 
 
 
 
 
 
 
 
 
 
Balance, beginning of period
$
10,771

 
$
524

 
$
757

 
$
368

 
$
1,261

 
$
13,681

Provision charged to expense
(267
)
 
775

 
87

 
58

 
(609
)
 
44

Losses charged off
(22
)
 
—

 
(30
)
 
(81
)
 
—

 
(133
)
Recoveries
66

 
1

 
4

 
42

 
—

 
113

Balance, end of period
$
10,548

 
$
1,300

 
$
818

 
$
387

 
$
652

 
$
13,705

Ending balance:
 

 
 

 
 

 
 

 
 

 
 

Individually evaluated for impairment
$
293

 
$
—

 
$
14

 
$
—

 
$
—

 
$
307

Collectively evaluated for impairment
$
10,255

 
$
1,300

 
$
804

 
$
387

 
$
652

 
$
13,398

Three months ended September 30, 2013
 
 

 
 

 
 

 
 

 
 

Allowance for loan losses:
 

 
 

 
 

 
 

 
 

 
 

Balance, beginning of period
$
9,304

 
$
414

 
$
793

 
$
397

 
$
1,223

 
$
12,131

Provision charged to expense
1,475

 
43

 
17

 
50

 
(610
)
 
975

Losses charged off
(184
)
 
—

 
(18
)
 
(72
)
 
—

 
(274
)
Recoveries
108

 
3

 
2

 
32

 
—

 
145

Balance, end of period
$
10,703

 
$
460

 
$
794

 
$
407

 
$
613

 
$
12,977

Ending balance:
 

 
 

 
 

 
 

 
 

 
 

Individually evaluated for impairment
$
540

 
$
—

 
$
—

 
$
—

 
$
—

 
$
540

Collectively evaluated for impairment
$
10,163

 
$
460

 
$
794

 
$
407

 
$
613

 
$
12,437

Nine months ended September 30, 2014
 
 
 
 
 
 
 
 
 
 
Allowance for loan losses:
 
 
 
 
 
 
 
 
 
 
 
Balance, beginning of year
$
10,646

 
$
533

 
$
771

 
$
377

 
$
922

 
$
13,249

Provision charged to expense
(192
)
 
765

 
98

 
94

 
(270
)
 
495

Losses charged off
(54
)
 
—

 
(75
)
 
(186
)
 
—

 
(315
)
Recoveries
148

 
2

 
24

 
102

 
—

 
276

Balance, end of period
$
10,548

 
$
1,300

 
$
818

 
$
387

 
$
652

 
$
13,705

Ending balance:
 

 
 

 
 

 
 

 
 

 
 

Individually evaluated for impairment
$
293

 
$
—

 
$
14

 
$
—

 
$
—

 
$
307

Collectively evaluated for impairment
$
10,255

 
$
1,300

 
$
804

 
$
387

 
$
652

 
$
13,398

Loans:
 

 
 

 
 

 
 

 
 

 
 

Ending balance
$
667,656

 
$
169,309

 
$
188,521

 
$
15,522

 
$
—

 
$
1,041,008

Ending balance:
 

 
 

 
 

 
 

 
 

 
 

Individually evaluated for impairment
$
3,473

 
$
—

 
$
225

 
$
—

 
$
—

 
$
3,698

Collectively evaluated for impairment
$
664,183

 
$
169,309

 
$
188,296

 
$
15,522

 
$
—

 
$
1,037,310

 
 
Commercial/ Commercial Real Estate
 
Agricultural/ Agricultural Real Estate
 
Residential  Real Estate
 
Consumer
 
Unallocated
 
Total
Nine months ended September 30, 2013
 
 
 
 
 
 
 
 
 
 
Allowance for loan losses:
 
 
 
 
 
 
 
 
 
 
 
Balance, beginning of year
$
9,301

 
$
558

 
$
726

 
$
403

 
$
788

 
$
11,776

Provision charged to expense
1,759

 
(102
)
 
161

 
64

 
(175
)
 
1,707

Losses charged off
(551
)
 
—

 
(104
)
 
(169
)
 
—

 
(824
)
Recoveries
194

 
4

 
11

 
109

 
—

 
318

Balance, end of period
$
10,703

 
$
460

 
$
794

 
$
407

 
$
613

 
$
12,977

Ending balance:
 

 
 

 
 

 
 

 
 

 
 

Individually evaluated for impairment
$
540

 
$
—

 
$
—

 
$
—

 
$
—

 
$
540

Collectively evaluated for impairment
$
10,163

 
$
460

 
$
794

 
$
407

 
$
613

 
$
12,437

Loans:
 

 
 

 
 

 
 

 
 

 
 

Ending balance
$
575,912

 
$
162,443

 
$
189,440

 
$
15,296

 
$
—

 
$
943,091

Ending balance:
 

 
 

 
 

 
 

 
 

 
 

Individually evaluated for impairment
$
4,540

 
$
337

 
$
—

 
$
—

 
$
—

 
$
4,877

Collectively evaluated for impairment
$
571,372

 
$
162,106

 
$
189,440

 
$
15,296

 
$
—

 
$
938,214

Year ended December 31, 2013
 

 
 

 
 

 
 

 
 

 
 

Allowance for loan losses:
 

 
 

 
 

 
 

 
 

 
 

Balance, beginning of year
$
9,301

 
$
558

 
$
726

 
$
403

 
$
788

 
$
11,776

Provision charged to expense
1,861

 
(30
)
 
171

 
57

 
134

 
2,193

Losses charged off
(764
)
 
—

 
(141
)
 
(223
)
 
—

 
(1,128
)
Recoveries
248

 
5

 
15

 
140

 
—

 
408

Balance, end of year
$
10,646

 
$
533

 
$
771

 
$
377

 
$
922

 
$
13,249

Ending balance:
 

 
 

 
 

 
 

 
 

 
 

Individually evaluated for impairment
$
604

 
$
—

 
$
—

 
$
—

 
$
—

 
$
604

Collectively evaluated for impairment
$
10,042

 
$
533

 
$
771

 
$
377

 
$
922

 
$
12,645

Loans:
 

 
 

 
 

 
 

 
 

 
 

Ending balance
$
607,062

 
$
172,979

 
$
187,796

 
$
14,967

 
$
—

 
$
982,804

Ending balance:
 

 
 

 
 

 
 

 
 

 
 

Individually evaluated for impairment
$
5,145

 
$
—

 
$
—

 
$
—

 
$
—

 
$
5,145

Collectively evaluated for impairment
$
601,917

 
$
172,979

 
$
187,796

 
$
14,967

 
$
—

 
$
977,659
Credit Risk Profile of the Company's Loan Portfolio
Loans not meeting the criteria above that are analyzed individually as part of the above described process are considered pass rated loans.

The following tables present the credit risk profile of the Company’s loan portfolio based on rating category and payment activity as of September 30, 2014 and December 31, 2013 (in thousands):

 
Construction &
Land Development
 
Agricultural Real Estate
 
1-4 Family Residential
Properties
 
Multifamily Residential
Properties
 
2014
 
2013
 
2014
 
2013
 
2014
 
2013
 
2014
 
2013
Pass
$
22,296

 
$
23,839

 
$
108,111

 
$
108,262

 
$
181,577

 
$
182,593

 
$
53,186

 
$
50,174

Watch
—

 
—

 
431

 
231

 
818

 
637

 
—

 
—

Substandard
817

 
1,482

 
1,186

 
912

 
2,979

 
1,531

 
—

 
—

Doubtful
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

Total
$
23,113

 
$
25,321

 
$
109,728

 
$
109,405

 
$
185,374

 
$
184,761

 
$
53,186

 
$
50,174


 
Commercial Real Estate (Nonfarm/Nonresidential)
 
Agricultural Loans
 
Commercial & Industrial Loans
 
Consumer Loans
 
2014
 
2013
 
2014
 
2013
 
2014
 
2013
 
2014
 
2013
Pass
$
355,902

 
$
335,284

 
$
58,601

 
$
62,439

 
$
206,074

 
$
158,107

 
$
15,039

 
$
14,558

Watch
15,877

 
17,998

 
734

 
193

 
4,599

 
3,515

 
10

 
—

Substandard
2,913

 
3,717

 
886

 
1,496

 
691

 
6,731

 
5

 
21

Doubtful
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

Total
$
374,692

 
$
356,999

 
$
60,221

 
$
64,128

 
$
211,364

 
$
168,353

 
$
15,054

 
$
14,579


 
All Other Loans
 
Total Loans
 
2014
 
2013
 
2014
 
2013
Pass
$
8,276

 
$
9,084

 
$
1,009,062

 
$
944,340

Watch
—

 
—

 
22,469

 
22,574

Substandard
—

 
—

 
9,477

 
15,890

Doubtful
—

 
—

 
—

 
—

Total
$
8,276

 
$
9,084

 
$
1,041,008

 
$
982,804
Loan Portfolio Aging Analysis
The following table presents the Company’s loan portfolio aging analysis at September 30, 2014 and December 31, 2013 (in thousands):
 
30-59 days Past Due
 
60-89 days Past Due
 
90 Days
or More Past Due
 
Total
Past Due
 
Current
 
Total Loans Receivable
 
Total Loans > 90 days & Accruing
September 30, 2014
 
 
 
 
 
 
 
 
 
 
 
 
 
Construction and land development
$
26

 
$
—

 
$
—

 
$
26

 
$
23,087

 
$
23,113

 
$
—

Agricultural real estate
81

 
—

 
—

 
81

 
109,647

 
109,728

 
—

1-4 Family residential properties
564

 
160

 
212

 
936

 
184,438

 
185,374

 
—

Multifamily residential properties
—

 
—

 
—

 
—

 
53,186

 
53,186

 
—

Commercial real estate
—

 
1,285

 
49

 
1,334

 
373,358

 
374,692

 
—

Loans secured by real estate
671

 
1,445

 
261

 
2,377

 
743,716

 
746,093

 
—

Agricultural loans
328

 
184

 
—

 
512

 
59,709

 
60,221

 
—

Commercial and industrial loans
88

 
69

 
72

 
229

 
211,135

 
211,364

 
—

Consumer loans
51

 
—

 
17

 
68

 
14,986

 
15,054

 
—

All other loans
—

 
—

 
—

 
—

 
8,276

 
8,276

 
—

Total loans
$
1,138

 
$
1,698

 
$
350

 
$
3,186

 
$
1,037,822

 
$
1,041,008

 
$
—

December 31, 2013
 

 
 

 
 

 
 

 
 

 
 

 
 

Construction and land development
$
—

 
$
—

 
$
—

 
$
—

 
$
25,321

 
$
25,321

 
$
—

Agricultural real estate
299

 
—

 
—

 
299

 
109,106

 
109,405

 
—

1-4 Family residential properties
326

 
146

 
371

 
843

 
183,918

 
184,761

 
—

Multifamily residential properties
—

 
—

 
—

 
—

 
50,174

 
50,174

 
—

Commercial real estate
568

 
1,030

 
145

 
1,743

 
355,256

 
356,999

 
—

Loans secured by real estate
1,193

 
1,176

 
516

 
2,885

 
723,775

 
726,660

 
—

Agricultural loans
122

 
49

 
—

 
171

 
63,957

 
64,128

 
—

Commercial and industrial loans
113

 
88

 
62

 
263

 
168,090

 
168,353

 
—

Consumer loans
83

 
25

 
4

 
112

 
14,467

 
14,579

 
—

All other loans
—

 
—

 
—

 
—

 
9,084

 
9,084

 
—

Total loans
$
1,511

 
$
1,338

 
$
582

 
$
3,431

 
$
979,373

 
$
982,804

 
$
—
Impaired Loans
The following tables present impaired loans as of September 30, 2014 and December 31, 2013 (in thousands):

 
September 30, 2014
 
December 31, 2013
 
Recorded
Balance
 
Unpaid Principal Balance
 
Specific Allowance
 
Recorded
Balance
 
Unpaid Principal Balance
 
Specific Allowance
Loans with a specific allowance:
 
 
 
 
 
 
 
 
 
 
 
Construction and land development
$
817

 
$
1,668

 
$
52

 
$
614

 
$
614

 
$
76

Agricultural real estate
—

 
—

 
—

 
—

 
—

 
—

1-4 Family residential properties
171

 
171

 
14

 
—

 
—

 
—

Multifamily residential properties
—

 
—

 
—

 
—

 
—

 
—

Commercial real estate
518

 
518

 
141

 
1,096

 
1,096

 
301

Loans secured by real estate
1,506

 
2,357

 
207

 
1,710

 
1,710

 
377

Agricultural loans
—

 
—

 
—

 
—

 
—

 
—

Commercial and industrial loans
100

 
100

 
100

 
275

 
275

 
227

Consumer loans
—

 
—

 
—

 
—

 
—

 
—

All other loans
—

 
—

 
—

 
—

 
—

 
—

Total loans
$
1,606

 
$
2,457

 
$
307

 
$
1,985

 
$
1,985

 
$
604

Loans without a specific allowance:
 

 
 

 
 

 
 

 
 

 
 

Construction and land development
$
—

 
$
—

 
$
—

 
$
869

 
$
1,727

 
$
—

Agricultural real estate
34

 
41

 
—

 
105

 
113

 
—

1-4 Family residential properties
867

 
1,240

 
—

 
1,110

 
1,558

 
—

Multifamily residential properties
—

 
—

 
—

 
—

 
—

 
—

Commercial real estate
1,770

 
1,794

 
—

 
1,750

 
1,778

 
—

Loans secured by real estate
2,671

 
3,075

 
—

 
3,834

 
5,176

 
—

Agricultural loans
—

 
—

 
—

 
—

 
—

 
—

Commercial and industrial loans
510

 
830

 
—

 
613

 
946

 
—

Consumer loans
33

 
42

 
—

 
37

 
51

 
—

All other loans
—

 
—

 
—

 
—

 
—

 
—

Total loans
$
3,214

 
$
3,947

 
$
—

 
$
4,484

 
$
6,173

 
$
—

Total loans:
 

 
 

 
 

 
 

 
 

 
 

Construction and land development
$
817

 
$
1,668

 
$
52

 
$
1,483

 
$
2,341

 
$
76

Agricultural real estate
34

 
41

 
—

 
105

 
113

 
—

1-4 Family residential properties
1,038

 
1,411

 
14

 
1,110

 
1,558

 
—

Multifamily residential properties
—

 
—

 
—

 
—

 
—

 
—

Commercial real estate
2,288

 
2,312

 
141

 
2,846

 
2,874

 
301

Loans secured by real estate
4,177

 
5,432

 
207

 
5,544

 
6,886

 
377

Agricultural loans
—

 
—

 
—

 
—

 
—

 
—

Commercial and industrial loans
610

 
930

 
100

 
888

 
1,221

 
227

Consumer loans
33

 
42

 
—

 
37

 
51

 
—

All other loans
—

 
—

 
—

 
—

 
—

 
—

Total loans
$
4,820

 
$
6,404

 
$
307

 
$
6,469

 
$
8,158

 
$
604
Impaired loans by portfolio class
The following tables present average recorded investment and interest income recognized on impaired loans for the three and nine-month periods ended September 30, 2014 and 2013 (in thousands):

 
For the three months ended
 
September 30, 2014
 
September 30, 2013
 
Average Investment
in Impaired Loans
 
Interest Income Recognized
 
Average Investment
in Impaired Loans
 
Interest Income Recognized
Construction and land development
$
817

 
$
—

 
$
1,753

 
$
—

Agricultural real estate
34

 
—

 
238

 
—

1-4 Family residential properties
1,129

 
5

 
1,007

 
2

Commercial real estate
2,349

 
1

 
2,939

 
—

Loans secured by real estate
4,329

 
6

 
5,937

 
2

Agricultural loans
—

 
—

 
209

 
—

Commercial and industrial loans
653

 
—

 
905

 
—

Consumer loans
35

 
—

 
78

 
1

Total loans
$
5,017

 
$
6

 
$
7,129

 
$
3


 
 
 
 
 
 
 
 
 
For the nine months ended
 
September 30, 2014
 
September 30, 2013
 
Average Investment
in Impaired Loans
 
Interest Income Recognized
 
Average Investment
in Impaired Loans
 
Interest Income Recognized
Construction and land development
$
1,004

 
$
—

 
$
1,775

 
$
—

Agricultural real estate
35

 
—

 
238

 
—

1-4 Family residential properties
1,156

 
12

 
1,172

 
4

Commercial real estate
2,379

 
2

 
2,985

 
—

Loans secured by real estate
4,574

 
14

 
6,170

 
4

Agricultural loans
—

 
—

 
238

 
—

Commercial and industrial loans
696

 
—

 
1,169

 
—

Consumer loans
39

 
1

 
82

 
2

Total loans
$
5,309

 
$
15

 
$
7,659

 
$
6
Nonaccrual Loans
The following table presents the Company’s recorded balance of nonaccrual loans as September 30, 2014 and December 31, 2013 (in thousands). This table excludes purchased impaired loans and performing troubled debt restructurings.

 
September 30,
2014
 
December 31,
2013
Construction and land development
$
817

 
$
1,483

Agricultural real estate
34

 
105

1-4 Family residential properties
693

 
1,009

Commercial real estate
2,250

 
2,807

Loans secured by real estate
3,794

 
5,404

Agricultural loans
—

 
—

Commercial and industrial loans
610

 
706

Consumer loans
20

 
11

Total loans
$
4,424

 
$
6,121
Recorded Balance of Troubled Debt Restructurings
The following table presents the Company’s recorded balance of troubled debt restructurings at September 30, 2014 and December 31, 2013 (in thousands).
Troubled debt restructurings:
September 30,
2014
 
December 31,
2013
Construction and land development
$
817

 
$
1,482

1-4 Family residential properties
511

 
306

Commercial real estate
1,345

 
899

Loans secured by real estate
2,673

 
2,687

Commercial and industrial loans
286

 
487

Consumer loans
18

 
26

Total
$
2,977

 
$
3,200

Performing troubled debt restructurings:
 

 
 

1-4 Family residential properties
$
345

 
$
101

Commercial real estate
38

 
39

Loans secured by real estate
383

 
140

Commercial and industrial loans
—

 
182

Consumer loans
12

 
26

Total
$
395

 
$
348
Financing Receivables,Troubled Debt Restructurings during period [Table Text Block]
The following table presents loans modified as TDRs during the nine months ended September 30, 2014 and 2013, as a result of various modified loan factors (in thousands):
 
September 30, 2014
 
September 30, 2013
 
Number of Modifications
 
Recorded Investment
 
Type of Modifications
 
Number of Modifications
 
Recorded Investment
 
Type of Modifications
1-4 Family residential properties
3

 
248

 
(c)
 
1

 
$
357

 
(a)
Commercial real estate
1

 
501

 
(b)(c)
 
4

 
176

 
(a)(b)(c)
Loans secured by real estate
4

 
749

 
 
 
5

 
533

 
 
Commercial and industrial loans
—

 
—

 

 
1

 
54

 
(a)(b)
Consumer Loans
—

 
—

 

 
3

 
16

 
(b)(c)
Total
4

 
$
749

 
 
 
9

 
$
603