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LOANS (Tables)
 12 Months Ended
Dec. 31, 2012
LOANS [Abstract]  
Components of Loans Receivable
The loan portfolio consisted of the following (in thousands):
 
 
December 31,
 
 
2012
 
 
2011
 
Commercial, financial and agricultural
 
$
315,655
 
 
$
223,283
 
Lease financing receivable
 
 
5,769
 
 
 
4,276
 
Real estate – construction
 
 
75,334
 
 
 
52,712
 
Real estate – commercial
 
 
414,384
 
 
 
280,798
 
Real estate – residential
 
 
142,858
 
 
 
113,582
 
Installment loans to individuals
 
 
90,561
 
 
 
69,980
 
Other
 
 
2,379
 
 
 
1,674
 
 
 
1,046,940
 
 
 
746,305
 
Less allowance for loan losses
 
 
(7,370
)
 
 
(7,276
)
 
$
1,039,570
 
 
$
739,029
 
 
Summary of Activity in Allowance for Loan Losses
An analysis of the activity in the allowance for loan losses is as follows (in thousands):
 
 
December 31,
 
 
2012
 
 
2011
 
 
2010
 
Balance, beginning of year
 
$
7,276
 
 
$
8,813
 
 
$
7,995
 
Provision for loan losses
 
 
2,050
 
 
 
3,925
 
 
 
5,020
 
Recoveries
 
 
300
 
 
 
310
 
 
 
254
 
Loans charged-off
 
 
(2,256
)
 
 
(5,772
)
 
 
(4,456
)
Balance, end of year
 
$
7,370
 
 
$
7,276
 
 
$
8,813
 
 
Activity in Related Party Loans and Commitments to Extend Credit
An analysis of the 2012 activity with respect to these related party loans and commitments to extend credit is as follows (in thousands):
 
Balance, beginning of year
 
$
1,980
 
New loans
 
 
21
 
Change in related parties due to acquisition
 
 
4,941
 
Repayments and adjustments
 
 
(21
)
Balance, end of year
 
$
6,921
 
 
Allowance for Loan Losses and Recorded Investment in Loans
The Company monitors loan concentrations and evaluates individual customer and aggregate industry leverage, profitability, risk rating distributions, and liquidity for each major standard industry classification segment.  At December 31, 2012, one industry segment concentration, the oil and gas industry, aggregate more than 10% of the loan portfolio.  The Company's exposure in the oil and gas industry, including related service and manufacturing industries, totaled approximately $146.2 million, or 14.0% of total loans.  Additionally, the Company's exposure to loans secured by commercial real estate is monitored.  At December 31, 2012, loans secured by commercial real estate (including commercial construction and multifamily loans) totaled approximately $472.4 million.  Of the $472.4 million, $359.2 million represent CRE loans, 57% of which are secured by owner-occupied commercial properties.  Of the $359.2 million in loans secured by commercial real estate, $4.0 million or 1.1% were on nonaccrual status at December 31, 2012.
 
Allowance for Loan Losses and Recorded Investment in Loans by Portfolio Segment
For the Year Ended December 31, 2012  (in thousands)
 
 
 
 
Real Estate
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Coml, Fin,
and Agric
 
 
Construction
 
 
Commercial
 
 
Residential
 
 
Consumer
 
 
Finance Leases
Coml
 
 
Other
 
 
Total
 
Allowance for loan losses:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Beginning balance
 
$
1,734
 
 
$
1,661
 
 
$
2,215
 
 
$
936
 
 
$
710
 
 
$
19
 
 
$
1
 
 
$
7,276
 
Charge-offs
 
 
(1,054
)
 
 
-
 
 
 
(550
)
 
 
(126
)
 
 
(526
)
 
 
-
 
 
 
-
 
 
 
(2,256
)
Recoveries
 
 
181
 
 
 
18
 
 
 
1
 
 
 
2
 
 
 
98
 
 
 
-
 
 
 
-
 
 
 
300
 
Provision
 
 
674
 
 
 
468
 
 
 
500
 
 
 
124
 
 
 
261
 
 
 
22
 
 
 
1
 
 
 
2,050
 
Ending balance
 
$
1,535
 
 
$
2,147
 
 
$
2,166
 
 
$
936
 
 
$
543
 
 
$
41
 
 
$
2
 
 
$
7,370
 
Ending balance: individually evaluated for impairment
 
$
391
 
 
$
57
 
 
$
35
 
 
$
30
 
 
$
114
 
 
$
-
 
 
$
-
 
 
$
627
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Loans:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Ending balance
 
$
315,655
 
 
$
75,334
 
 
$
414,384
 
 
$
142,858
 
 
$
90,561
 
 
$
5,769
 
 
$
2,379
 
 
$
1,046,940
 
Ending balance: individually evaluated for impairment
 
$
1,636
 
 
$
936
 
 
$
2,911
 
 
$
1,627
 
 
$
330
 
 
$
-
 
 
$
-
 
 
$
7,440
 
 
Allowance for Loan Losses and Recorded Investment in Loans by Portfolio Segment
For the Year Ended December 31, 2011  (in thousands)
 
Coml, Fin,
 
 
Real Estate
 
 
 
 
 
Finance Leases
 
 
 
 
 
 
 
 
and Agric
 
 
Construction
 
 
Commercial
 
 
Residential
 
 
Consumer
 
 
 Coml
 
 
Other
 
 
Total
 
Allowance for loan losses:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Beginning balance
 
$
1,664
 
 
$
2,963
 
 
$
2,565
 
 
$
862
 
 
$
730
 
 
$
29
 
 
$
-
 
 
$
8,813
 
Charge-offs
 
 
(1,109
)
 
 
(2,444
)
 
 
(1,246
)
 
 
(283
)
 
 
(671
)
 
 
(19
)
 
 
-
 
 
 
(5,772
)
Recoveries
 
 
152
 
 
 
14
 
 
 
1
 
 
 
4
 
 
 
138
 
 
 
1
 
 
 
-
 
 
 
310
 
Provision
 
 
1,027
 
 
 
1,128
 
 
 
895
 
 
 
353
 
 
 
513
 
 
 
8
 
 
 
1
 
 
 
3,925
 
Ending balance
 
$
1,734
 
 
$
1,661
 
 
$
2,215
 
 
$
936
 
 
$
710
 
 
$
19
 
 
$
1
 
 
$
7,276
 
Ending balance: individually evaluated for impairment
 
$
240
 
 
$
2
 
 
$
321
 
 
$
21
 
 
$
98
 
 
$
-
 
 
$
-
 
 
$
682
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Loans:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Ending balance
 
$
223,283
 
 
$
52,712
 
 
$
280,798
 
 
$
113,582
 
 
$
69,980
 
 
$
4,276
 
 
$
1,674
 
 
$
746,305
 
Ending balance: individually evaluated for impairment
 
$
2,341
 
 
$
901
 
 
$
2,271
 
 
$
1,142
 
 
$
287
 
 
$
-
 
 
$
-
 
 
$
6,942
 
Credit Quality Indicators by Class of Loans
Credit Quality Indicators by Class of Loans
As of December 31, 2012  (in thousands)
 
Commercial Credit Exposure
Credit Risk Profile by Creditworthiness Category
 
 
Commercial,
Financial, and
Agricultural
 
 
Commercial
Real Estate
Construction
 
 
Commercial
Real Estate –
Other
 
 
Percentage of
Total
 
Pass
 
$
304,219
 
 
$
54,737
 
 
$
396,078
 
 
 
95.76
%
Special mention
 
 
5,748
 
 
 
684
 
 
 
6,224
 
 
 
1.61
%
Substandard
 
 
4,503
 
 
 
2,925
 
 
 
7,514
 
 
 
1.90
%
Doubtful
 
 
1,185
 
 
 
4
 
 
 
4,569
 
 
 
0.73
%
 
$
315,655
 
 
$
58,350
 
 
$
414,384
 
 
 
100.00
%
 
Consumer Credit Exposure
Credit Risk Profile by Creditworthiness Category
 
 
Residential –
Construction
 
 
Residential –
Prime
 
 
Residential –
Subprime
 
 
Percentage of
Total
 
Pass
 
$
16,785
 
 
$
137,681
 
 
$
-
 
 
 
96.64
%
Special mention
 
 
-
 
 
 
1,612
 
 
 
-
 
 
 
1.01
%
Substandard
 
 
199
 
 
 
3,565
 
 
 
-
 
 
 
2.35
%
 
$
16,984
 
 
$
142,858
 
 
$
-
 
 
 
100.00
%
 
Consumer and Commercial Credit Exposure
Credit Risk Profile Based on Payment Activity
 
 
Consumer -
Credit Card
 
 
Consumer –
Other
 
 
Finance Leases
Commercial
 
 
Other
Loans
 
 
Percentage of
Total
 
Performing
 
$
6,792
 
 
$
83,347
 
 
$
5,769
 
 
$
2,379
 
 
 
99.57
%
Nonperforming
 
 
15
 
 
 
407
 
 
 
-
 
 
 
-
 
 
 
0.43
%
 
$
6,807
 
 
$
83,754
 
 
$
5,769
 
 
$
2,379
 
 
 
100.00
%
 
Credit Quality Indicators by Class of Loans
As of December 31, 2011  (in thousands)
 
Commercial Credit Exposure
Credit Risk Profile by Creditworthiness Category
 
 
Commercial,
Financial, and
Agricultural
 
 
Commercial
Real Estate
Construction
 
 
Commercial
Real Estate –
Other
 
 
Percentage
of Total
 
Pass
 
$
216,465
 
 
$
36,631
 
 
$
264,542
 
 
 
94.88
%
Special mention
 
 
1,705
 
 
 
1,104
 
 
 
10,755
 
 
 
2.49
%
Substandard
 
 
4,809
 
 
 
3,728
 
 
 
5,501
 
 
 
2.57
%
Doubtful
 
 
304
 
 
 
-
 
 
 
-
 
 
 
0.06
%
 
$
223,283
 
 
$
41,463
 
 
$
280,798
 
 
 
100.00
%
 
Consumer Credit Exposure
Credit Risk Profile by Creditworthiness Category
 
 
Residential –
Construction
 
 
Residential –
Prime
 
 
Residential –
Subprime
 
 
Percentage of
Total
 
Pass
 
$
9,041
 
 
$
104,965
 
 
$
-
 
 
 
91.33
%
Special mention
 
 
1,077
 
 
 
5,152
 
 
 
-
 
 
 
4.99
%
Substandard
 
 
1,131
 
 
 
3,465
 
 
 
-
 
 
 
3.68
%
 
$
11,249
 
 
$
113,582
 
 
$
-
 
 
 
100.00
%
 
Consumer and Commercial Credit Exposure
Credit Risk Profile Based on Payment Activity
 
 
Consumer -
Credit Card
 
 
Consumer –
Other
 
 
Finance Leases
Commercial
 
 
Other
Loans
 
 
Percentage of
Total
 
Performing
 
$
5,182
 
 
$
64,497
 
 
$
4,276
 
 
$
1,674
 
 
 
99.60
%
Nonperforming
 
 
18
 
 
 
283
 
 
 
-
 
 
 
-
 
 
 
0.40
%
 
$
5,200
 
 
$
64,780
 
 
$
4,276
 
 
$
1,674
 
 
 
100.00
%
Age Analysis of Past Due Loans by Class of Loans
Age Analysis of Past Due Loans by Class of Loans
(in thousands)
 
 
30-59
Days
Past Due
 
 
60-89
Days
Past Due
 
 
Greater
than 90
Days
Past
Due
 
 
Total
Past
Due
 
 
Current
 
 
Total Loans
 
 
Recorded
Investment
> 90 days
and
Accruing
 
As of December 31, 2012
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Commercial, financial, and agricultural
 
$
2,220
 
 
$
321
 
 
$
2,580
 
 
$
5,121
 
 
$
310,534
 
 
$
315,655
 
 
$
1,019
 
Commercial real estate - construction
 
 
66
 
 
 
96
 
 
 
101
 
 
 
263
 
 
 
58,087
 
 
 
58,350
 
 
 
-
 
Commercial real estate - other
 
 
4,131
 
 
 
2,108
 
 
 
3,577
 
 
 
9,816
 
 
 
404,568
 
 
 
414,384
 
 
 
952
 
Consumer - credit card
 
 
24
 
 
 
2
 
 
 
15
 
 
 
41
 
 
 
6,766
 
 
 
6,807
 
 
 
15
 
Consumer - other
 
 
421
 
 
 
134
 
 
 
186
 
 
 
741
 
 
 
83,013
 
 
 
83,754
 
 
 
-
 
Residential - construction
 
 
-
 
 
 
-
 
 
 
-
 
 
 
-
 
 
 
16,984
 
 
 
16,984
 
 
 
-
 
Residential - prime
 
 
1,140
 
 
 
317
 
 
 
1,408
 
 
 
2,865
 
 
 
139,993
 
 
 
142,858
 
 
 
-
 
Residential - subprime
 
 
-
 
 
 
-
 
 
 
-
 
 
 
-
 
 
 
-
 
 
 
-
 
 
 
-
 
Other loans
 
 
87
 
 
 
-
 
 
 
-
 
 
 
87
 
 
 
2,292
 
 
 
2,379
 
 
 
-
 
Finance leases commercial
 
 
-
 
 
 
-
 
 
 
-
 
 
 
-
 
 
 
5,769
 
 
 
5,769
 
 
 
-
 
 
$
8,089
 
 
$
2,978
 
 
$
7,867
 
 
$
18,934
 
 
$
1,028,006
 
 
$
1,046,940
 
 
$
1,986
 
 
 
30-59
Days
Past Due
 
 
60-89
Days
Past Due
 
 
Greater
than 90
Days
Past
Due
 
 
Total
Past
Due
 
 
Current
 
 
Total Loans
 
 
Recorded
Investment
> 90 days
and
Accruing
 
As of December 31, 2011
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Commercial, financial, and agricultural
 
$
622
 
 
$
242
 
 
$
1,856
 
 
$
2,720
 
 
$
220,563
 
 
$
223,283
 
 
$
64
 
Commercial real estate - construction
 
 
673
 
 
 
166
 
 
 
358
 
 
 
1,197
 
 
 
40,266
 
 
 
41,463
 
 
 
-
 
Commercial real estate - other
 
 
3,185
 
 
 
-
 
 
 
1,878
 
 
 
5,063
 
 
 
275,735
 
 
 
280,798
 
 
 
-
 
Consumer - credit card
 
 
79
 
 
 
-
 
 
 
19
 
 
 
98
 
 
 
5,102
 
 
 
5,200
 
 
 
19
 
Consumer - other
 
 
410
 
 
 
193
 
 
 
269
 
 
 
872
 
 
 
63,908
 
 
 
64,780
 
 
 
8
 
Residential - construction
 
 
-
 
 
 
-
 
 
 
-
 
 
 
-
 
 
 
11,249
 
 
 
11,249
 
 
 
-
 
Residential - prime
 
 
2,457
 
 
 
469
 
 
 
685
 
 
 
3,611
 
 
 
109,971
 
 
 
113,582
 
 
 
140
 
Residential - subprime
 
 
-
 
 
 
-
 
 
 
-
 
 
 
-
 
 
 
-
 
 
 
-
 
 
 
-
 
Other loans
 
 
118
 
 
 
-
 
 
 
-
 
 
 
118
 
 
 
1,556
 
 
 
1,674
 
 
 
-
 
Finance leases commercial
 
 
-
 
 
 
-
 
 
 
-
 
 
 
-
 
 
 
4,276
 
 
 
4,276
 
 
 
-
 
 
$
7,544
 
 
$
1,070
 
 
$
5,065
 
 
$
13,679
 
 
$
732,626
 
 
$
746,305
 
 
$
231
 
Impaired Loans by Class of Loans
Impaired Loans by Class of Loans
(in thousands)

 
 
Recorded
Investment
 
 
Unpaid
Principal
Balance
 
 
Related
Allowance
 
 
Average
Recorded
Investment
 
 
Interest
Income
Recognized
 
As of December 31, 2012
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
With no related allowance recorded:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Commercial, financial, and agricultural
 
$
564
 
 
$
675
 
 
$
-
 
 
$
861
 
 
$
5
 
Commercial real estate – construction
 
 
771
 
 
 
770
 
 
 
-
 
 
 
834
 
 
 
1
 
Commercial real estate – other
 
 
2,530
 
 
 
3,059
 
 
 
-
 
 
 
1,780
 
 
 
38
 
Consumer – other
 
 
114
 
 
 
122
 
 
 
-
 
 
 
81
 
 
 
1
 
Residential – prime
 
 
1,575
 
 
 
1,575
 
 
 
-
 
 
 
1,213
 
 
 
26
 
Subtotal:
 
 
5,554
 
 
 
6,201
 
 
 
-
 
 
 
4,769
 
 
 
71
 
With an allowance recorded:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Commercial, financial, and agricultural
 
 
1,072
 
 
 
1,072
 
 
 
391
 
 
 
1,128
 
 
 
21
 
Commercial real estate – construction
 
 
165
 
 
 
165
 
 
 
57
 
 
 
85
 
 
 
7
 
Commercial real estate – other
 
 
381
 
 
 
381
 
 
 
35
 
 
 
811
 
 
 
3
 
Consumer – other
 
 
216
 
 
 
216
 
 
 
114
 
 
 
228
 
 
 
6
 
Residential – prime
 
 
52
 
 
 
52
 
 
 
30
 
 
 
172
 
 
 
4
 
Subtotal:
 
 
1,886
 
 
 
1,886
 
 
 
627
 
 
 
2,424
 
 
 
41
 
Totals:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Commercial
 
 
5,483
 
 
 
6,122
 
 
 
483
 
 
 
5,499
 
 
 
75
 
Consumer
 
 
330
 
 
 
338
 
 
 
114
 
 
 
309
 
 
 
7
 
Residential
 
 
1,627
 
 
 
1,627
 
 
 
30
 
 
 
1,385
 
 
 
30
 
Grand total:
 
$
7,440
 
 
$
8,087
 
 
$
627
 
 
$
7,193
 
 
$
112
 
 
 
Recorded
Investment
 
 
Unpaid
Principal
Balance
 
 
Related
Allowance
 
 
Average
Recorded
Investment
 
 
Interest
Income
Recognized
 
As of December 31, 2011
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
With no related allowance recorded:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Commercial, financial, and agricultural
 
$
1,157
 
 
$
1,248
 
 
$
-
 
 
$
2,311
 
 
$
2
 
Commercial real estate – construction
 
 
897
 
 
 
963
 
 
 
-
 
 
 
4,511
 
 
 
9
 
Commercial real estate – other
 
 
1,029
 
 
 
1,029
 
 
 
-
 
 
 
2,958
 
 
 
31
 
Consumer – other
 
 
48
 
 
 
59
 
 
 
-
 
 
 
65
 
 
 
3
 
Residential – prime
 
 
851
 
 
 
851
 
 
 
-
 
 
 
1,334
 
 
 
28
 
Finance leases commercial
 
 
-
 
 
 
-
 
 
 
-
 
 
 
4
 
 
 
-
 
Other loans
 
 
-
 
 
 
-
 
 
 
-
 
 
 
3
 
 
 
-
 
Subtotal:
 
 
3,982
 
 
 
4,150
 
 
 
-
 
 
 
11,186
 
 
 
73
 
With an allowance recorded:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Commercial, financial, and agricultural
 
 
1,184
 
 
 
1,184
 
 
 
240
 
 
 
1,140
 
 
 
58
 
Commercial real estate – construction
 
 
4
 
 
 
4
 
 
 
2
 
 
 
1,580
 
 
 
-
 
Commercial real estate – other
 
 
1,242
 
 
 
1,242
 
 
 
321
 
 
 
1,639
 
 
 
98
 
Consumer – other
 
 
239
 
 
 
242
 
 
 
98
 
 
 
202
 
 
 
10
 
Residential – prime
 
 
291
 
 
 
291
 
 
 
21
 
 
 
255
 
 
 
1
 
Subtotal:
 
 
2,960
 
 
 
2,963
 
 
 
682
 
 
 
4,816
 
 
 
167
 
Totals:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Commercial
 
 
5,513
 
 
 
5,670
 
 
 
563
 
 
 
14,143
 
 
 
198
 
Consumer
 
 
287
 
 
 
301
 
 
 
98
 
 
 
267
 
 
 
13
 
Residential
 
 
1,142
 
 
 
1,142
 
 
 
21
 
 
 
1,589
 
 
 
29
 
Other
 
 
-
 
 
 
-
 
 
 
-
 
 
 
3
 
 
 
-
 
Grand total:
 
$
6,942
 
 
$
7,113
 
 
$
682
 
 
$
16,002
 
 
$
240
 
Modifications by Class of Loans
Modifications by Class of Loans
(in thousands)
 
 
Number of
Contracts
 
 
Pre-Modification
Outstanding
Recorded Investment
 
 
Post-Modification
Outstanding
Recorded Investment
 
Troubled debt restructurings as of December 31, 2012:
 
 
 
 
 
 
 
 
 
Commercial, financial, and agricultural
 
 
3
 
 
$
370
 
 
$
353
 
Real estate - commercial
 
 
3
 
 
 
4,983
 
 
 
4,709
 
 
 
 
 
 
$
5,353
 
 
$
5,062
 
 
 
 
 
 
 
 
 
 
 
 
Number of
Contracts
 
 
Pre-Modification
Outstanding
Recorded Investment
 
 
Post-Modification
Outstanding
Recorded Investment
 
Troubled debt restructurings as of December 31, 2011:
 
 
 
 
 
 
 
 
 
Commercial, financial, and agricultural
 
 
4
 
 
$
447
 
 
$
444
 
Consumer - other
 
 
1
 
 
 
14
 
 
 
12
 
 
 
 
 
 
$
461
 
 
$
456
 

Trouble Debt Restructurings that Subsequently Defaulted
(in thousands)
 
 
December 31, 2012
 
 
December 31, 2011
 
 
Number of
Contracts
 
 
Recorded
Investment
 
 
Number of
Contracts
 
 
Recorded
Investment
 
Commercial, financial, and agricultural
 
 
4
 
 
$
259
 
 
 
-
 
 
$
-
 
 
Loans on Nonaccrual Status
Loans on Nonaccrual Status by Class of Loans
(in thousands)
 
 
December 31, 2012
 
 
December 31, 2011
 
Commercial, financial, and agricultural
 
$
2,015
 
 
$
1,897
 
Commercial real estate - construction
 
 
941
 
 
 
902
 
Commercial real estate - other
 
 
3,017
 
 
 
2,271
 
Consumer - credit card
 
 
-
 
 
 
-
 
Consumer - other
 
 
409
 
 
 
275
 
Residential - construction
 
 
-
 
 
 
-
 
Residential - prime
 
 
2,505
 
 
 
884
 
Residential - subprime
 
 
-
 
 
 
-
 
Other loans
 
 
-
 
 
 
-
 
Finance leases commercial
 
 
-
 
 
 
-
 
 
$
8,887
 
 
$
6,229