Note 3. Loans |
Note 3. Loans During the first three months of 2021, we executed 35 modifications allowing principal and interest deferrals in connection with COVID-19 relief to our customers, for a total of 1,266 deferrals since COVID began. Of those modifications, 52 remain in deferral as of March 31, 2021 with balances of $11,756. These modifications and deferrals were not considered troubled debt restructurings pursuant to interagency guidance issued in March 2020 and the Coronavirus Aid, Relief and Economic Security (“CARES”) Act. Loans held for investment outstanding at March 31, 2021 and December 31, 2020 are summarized as follows: (dollars in thousands) | | 2021 | | | 2020 | | Construction/Land Development | | $ | 69,292 | | | $ | 71,467 | | Farmland | | | 58,384 | | | | 53,728 | | Real Estate | | | 154,879 | | | | 163,018 | | Multi-Family | | | 4,203 | | | | 5,918 | | Commercial Real Estate | | | 137,259 | | | | 142,516 | | Home Equity – closed end | | | 7,640 | | | | 8,476 | | Home Equity – open end | | | 45,215 | | | | 46,613 | | Commercial & Industrial – Non-Real Estate | | | 75,495 | | | | 65,470 | | Consumer | | | 8,002 | | | | 9,405 | | Dealer Finance | | | 96,370 | | | | 91,861 | | Credit Cards | | | 2,634 | | | | 2,857 | | Total | | $ | 659,373 | | | $ | 661,329 | |
The Company has pledged loans held for investment as collateral for borrowings with the Federal Home Loan Bank of Atlanta totaling $165,307 and $173,029 as of March 31, 2021 and December 31, 2020, respectively. The Company maintains a blanket lien on certain loans in its residential real estate, commercial and home equity portfolios. Loans held for sale consists of loans originated by F&M Mortgage for sale in the secondary market, and the Bank’s commitment to purchase residential mortgage loan participations from Northpointe Bank. The volume of loans purchased from Northpointe fluctuates due to a number of factors including changes in secondary market rates, which affects demand for mortgage loans; the number of participating banks involved in the program; the number of mortgage loan originators selling loans to the lead bank and the funding capabilities of the lead bank. Loans held for sale as of March 31, 2021 and December 31, 2020 were $15,654 and $58,679, respectively. Note 3. Loans, continued The following is a summary of information pertaining to impaired loans (dollars in thousand): | | March 31, 2021 | | | December 31, 2020 | | | | | | | Unpaid | | | | | | | | | Unpaid | | | | | | | Recorded | | | Principal | | | Related | | | Recorded | | | Principal | | | Related | | | | Investment(1) | | | Balance | | | Allowance | | | Investment | | | Balance | | | Allowance | | Impaired loans without a valuation allowance: | | | | | | | | | | | | | | | | | | | Construction/Land Development | | $ | 1,779 | | | $ | 1,779 | | | $ | - | | | $ | 1,693 | | | $ | 1,693 | | | $ | - | | Farmland | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | Real Estate | | | 9,519 | | | | 9,519 | | | | - | | | | 6,648 | | | | 6,648 | | | | - | | Multi-Family | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | Commercial Real Estate | | | 9,588 | | | | 9,588 | | | | - | | | | 8,592 | | | | 8,656 | | | | - | | Home Equity – closed end | | | 678 | | | | 678 | | | | - | | | | 687 | | | | 687 | | | | - | | Home Equity – open end | | | - | | | | - | | | | - | | | | 151 | | | | 151 | | | | - | | Commercial & Industrial – Non-Real Estate | | | 5 | | | | 5 | | | | - | | | | 8 | | | | 8 | | | | - | | Consumer | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | Credit cards | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | Dealer Finance | | | 13 | | | | 13 | | | | - | | | | 8 | | | | 8 | | | | - | | | | | 21,582 | | | | 21,582 | | | | - | | | | 17,787 | | | | 17,851 | | | | - | | Impaired loans with a valuation allowance | | | | | | | | | | | | | | | | | | | | | | | | | Construction/Land Development | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | Farmland | | | 1,678 | | | | 1,678 | | | | 1 | | | | 1,737 | | | | 1,737 | | | | 370 | | Real Estate | | | 1,624 | | | | 1,624 | | | | 339 | | | | 7,143 | | | | 7,143 | | | | 365 | | Multi-Family | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | Commercial Real Estate | | | 7,110 | | | | 7,110 | | | | 1,884 | | | | 7,464 | | | | 7,464 | | | | 1,833 | | Home Equity – closed end | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | Home Equity – open end | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | Commercial & Industrial – Non-Real Estate | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | Consumer | | | - | | | | - | | | | - | | | | 1 | | | | 1 | | | | 1 | | Credit cards | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | Dealer Finance | | | 132 | | | | 132 | | | | 14 | | | | 147 | | | | 147 | | | | 15 | | | | | 10,544 | | | | 10,544 | | | | 2,238 | | | | 16,492 | | | | 16,492 | | | | 2,584 | | Total impaired loans | | $ | 32,126 | | | $ | 32,126 | | | $ | 2,238 | | | $ | 34,279 | | | $ | 34,343 | | | $ | 2,584 | |
________ 1The Recorded Investment is defined as the original principal balance less principal payments, charge-offs and nonaccrual payments applied to principal. Note 3. Loans Held for Investment, continued The following is a summary of the average investment and interest income recognized for impaired loans (dollars in thousands): | | March 31, 2021 | | | December 31, 2020 | | | | Average Recorded | | | Interest Income | | | Average Recorded | | | Interest Income | | | | Investment | | | Recognized | | | Investment | | | Recognized | | Impaired loans without a valuation allowance: | | | | | | | | | | | | | Construction/Land Development | | $ | 1,736 | | | $ | 13 | | | $ | 1,598 | | | $ | 103 | | Farmland | | | - | | | | - | | | | - | | | | - | | Real Estate | | | 8,084 | | | | 139 | | | | 5,520 | | | | 356 | | Multi-Family | | | - | | | | - | | | | - | | | | - | | Commercial Real Estate | | | 9,429 | | | | 21 | | | | 3,296 | | | | 229 | | Home Equity – closed end | | | 344 | | | | - | | | | 522 | | | | 34 | | Home Equity – open end | | | 76 | | | | - | | | | 38 | | | | 7 | | Commercial & Industrial – Non-Real Estate | | | 7 | | | | - | | | | 55 | | | | 1 | | Consumer | | | - | | | | - | | | | - | | | | - | | Credit cards | | | - | | | | - | | | | - | | | | - | | Dealer Finance | | | 11 | | | | - | | | | 24 | | | | 1 | | | | | 19,687 | | | | 173 | | | | 11,053 | | | | 731 | | Impaired loans with a valuation allowance: | | | | | | | | | | | | | | | | | Construction/Land Development | | $ | - | | | $ | - | | | $ | 243 | | | $ | - | | Farmland | | | 1,708 | | | | 59 | | | | 1,797 | | | | 233 | | Real Estate | | | 4,384 | | | | 10 | | | | 8,956 | | | | 413 | | Multi-Family | | | - | | | | - | | | | - | | | | - | | Commercial Real Estate | | | 7,287 | | | | 66 | | | | 4,108 | | | | 237 | | Home Equity – closed end | | | - | | | | 5 | | | | 177 | | | | - | | Home Equity – open end | | | - | | | | - | | | | 113 | | | | - | | Commercial & Industrial – Non-Real Estate | | | - | | | | - | | | | 17 | | | | - | | Consumer | | | 1 | | | | - | | | | 2 | | | | - | | Credit card | | | - | | | | - | | | | - | | | | - | | Dealer Finance | | | 140 | | | | 3 | | | | 146 | | | | 13 | | | | | 13,520 | | | | 143 | | | | 15,559 | | | | 896 | | Total Impaired Loans | | $ | 33,207 | | | $ | 316 | | | $ | 26,612 | | | $ | 1,627 | |
Note 3. Loans, continued The following table presents the aging of the recorded investment of past due loans (dollars in thousands) as of March 31, 2021 and December 31, 2020: | | 30-59 Days Past due | | | 60-89 Days Past Due | | | Greater than 90 Days | | | Total Past Due | | | Current | | | Total Loan Receivable | | | Non-Accrual Loans | | | Recorded Investment >90 days & accruing | | March 31, 2021 | | | | | | | | | | | | | | | | | | | | | | | | | Construction/Land Development | | $ | 415 | | | $ | - | | | $ | - | | | $ | 415 | | | $ | 68,877 | | | $ | 69,292 | | | $ | 168 | | | $ | - | | Farmland | | | - | | | | - | | | | - | | | | - | | | | 58,384 | | | | 58,384 | | | | 1,678 | | | | - | | Real Estate | | | 1,091 | | | | 384 | | | | 681 | | | | 2,156 | | | | 152,723 | | | | 154,879 | | | | 801 | | | | - | | Multi-Family | | | - | | | | - | | | | - | | | | - | | | | 4,203 | | | | 4,203 | | | | - | | | | - | | Commercial Real Estate | | | - | | | | - | | | | - | | | | - | | | | 137,259 | | | | 137,259 | | | | 2,890 | | | | - | | Home Equity – closed end | | | 3 | | | | - | | | | 30 | | | | 33 | | | | 7,607 | | | | 7,640 | | | | 30 | | | | - | | Home Equity – open end | | | 324 | | | | 26 | | | | 168 | | | | 518 | | | | 44,697 | | | | 45,215 | | | | 143 | | | | 25 | | Commercial & Industrial – Non- Real Estate | | | 163 | | | | - | | | | - | | | | 163 | | | | 75,332 | | | | 75,495 | | | | 1 | | | | - | | Consumer | | | 16 | | | | - | | | | - | | | | 16 | | | | 7,986 | | | | 8,002 | | | | - | | | | - | | Dealer Finance | | | 696 | | | | 89 | | | | - | | | | 785 | | | | 95,585 | | | | 96,370 | | | | 44 | | | | - | | Credit Cards | | | 25 | | | | - | | | | 3 | | | | 28 | | | | 2,606 | | | | 2,634 | | | | - | | | | 3 | | Total | | $ | 2,733 | | | $ | 499 | | | $ | 882 | | | $ | 4,114 | | | $ | 655,259 | | | $ | 659,373 | | | $ | 5,755 | | | $ | 28 | |
| | 30-59 Days Past due | | | 60-89 Days Past Due | | | Greater than 90 Days | | | Total Past Due | | | Current | | | Total Loan Receivable | | | Non-Accrual Loans | | | Recorded Investment >90 days & accruing | | December 31, 2020 | | | | | | | | | | | | | | | | | | | | | | | | | Construction/Land Development | | $ | 2,557 | | | $ | - | | | $ | - | | | $ | 2,557 | | | $ | 68,910 | | | $ | 71,467 | | | $ | 251 | | | $ | - | | Farmland | | | - | | | | - | | | | - | | | | - | | | | 53,728 | | | | 53,728 | | | | 1,737 | | | | - | | Real Estate | | | 1,724 | | | | 512 | | | | 304 | | | | 2,540 | | | | 160,478 | | | | 163,018 | | | | 368 | | | | 102 | | Multi-Family | | | - | | | | - | | | | - | | | | - | | | | 5,918 | | | | 5,918 | | | | - | | | | - | | Commercial Real Estate | | | 554 | | | | - | | | | 920 | | | | 1,474 | | | | 141,042 | | | | 142,516 | | | | 3,820 | | | | - | | Home Equity – closed end | | | 3 | | | | 30 | | | | - | | | | 33 | | | | 8,443 | | | | 8,476 | | | | - | | | | - | | Home Equity – open end | | | 716 | | | | - | | | | 212 | | | | 928 | | | | 45,685 | | | | 46,613 | | | | 212 | | | | - | | Commercial & Industrial – Non- Real Estate | | | 95 | | | | 44 | | | | - | | | | 139 | | | | 65,331 | | | | 65,470 | | | | 3 | | | | - | | Consumer | | | 39 | | | | - | | | | - | | | | 39 | | | | 9,366 | | | | 9,405 | | | | - | | | | - | | Dealer Finance | | | 694 | | | | 157 | | | | - | | | | 851 | | | | 91,010 | | | | 91,861 | | | | 44 | | | | - | | Credit Cards | | | 45 | | | | - | | | | - | | | | 45 | | | | 2,812 | | | | 2,857 | | | | - | | | | - | | Total | | $ | 6,427 | | | $ | 743 | | | $ | 1,436 | | | $ | 8,606 | | | $ | 652,723 | | | $ | 661,329 | | | $ | 6,435 | | | $ | 102 | |
On March 31, 2021 and December 31, 2020, other real estate owned did not include any foreclosed residential real estate. The Company had $878 of consumer mortgages for which foreclosure was in process on March 31, 2021. Nonaccrual loans on March 31, 2021 would have earned approximately $52 in interest income for the quarter had they been accruing loans.
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