Troubled Debt Restructuring

9 Months Ended

Sep. 30, 2020

Troubled Debt Restructuring

Note 8. Troubled Debt Restructuring

Note 8. Troubled Debt Restructuring

In the determination of the allowance for loan losses, management considers troubled debt restructurings and subsequent defaults in these restructurings by adjusting the loan grades of such loans, which are considered in the qualitative factors within the allowance. Defaults resulting in charge-offs affect the historical loss experience ratios which are a component of the allowance for loan loss methodology. Additionally, specific reserves may be established on restructured loans which are evaluated individually for impairment.

During the nine months ended September 30, 2020, there were four loan modifications that were considered to be troubled debt restructurings.Two of these loans was modified during the three months ended September 30, 2020 and two loan modifications considered a troubled debt restructuring were modified during the second quarter of 2020. Modifications may have included rate adjustments, revisions to amortization schedules, suspension of principal payments for a temporary period, re-advancing funds to be applied as payments to bring the loan(s) current, or any combination thereof.

	September 30, 2020
			Pre-Modification		Post-Modification
(dollars in thousands)			Outstanding		Outstanding
Troubled Debt Restructurings	Number of  Contracts		Recorded Investment		Recorded Investment
Consumer		4	$	26	$	26
Total		4	$	26	$	26

On September 30, 2020, there were no loans restructured in the previous 12 months in default or on nonaccrual status. A restructured loan is considered in default when it becomes 90 days past due.

During the nine months ended September 30, 2019, there were seven loan modifications that were considered to be troubled debt restructurings. All of the loan modifications that would be considered a troubled debt restructuring were modified during the first quarter of 2019. Modifications may have included rate adjustments, revisions to amortization schedules, suspension of principal payments for a temporary period, re-advancing funds to be applied as payments to bring the loan(s) current, or any combination thereof.

	Nine months ended September 30, 2019
			Pre-Modification		Post-Modification
(dollars in thousands)			Outstanding		Outstanding
Troubled Debt Restructurings	Number of Contracts		Recorded  Investment		Recorded Investment
Real Estate		1	$	192	$	192
Home Equity		1		718		718
Commercial and Industrial		1		20		20
Consumer		4		33		33
Total		7	$	963	$	963

On September 30, 2019, there were three loans restructured in the previous 12 months in default or on nonaccrual status.  A restructured loan is considered in default when it becomes 90 days past due.

	September 30, 2019
			Pre-Modification		Post-Modification
(dollars in thousands)			Outstanding		Outstanding
Troubled Debt Restructurings	Number of Contracts		Recorded Investment		Recorded Investment
Real Estate		2	$	221	$	221
Consumer		1		3		3
Total		3	$	224	$	224