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Credit Quality of Loans and Allowance for Loan Losses (Tables)
 9 Months Ended
Sep. 30, 2013
Credit Quality of Loans and Allowance for Loan Losses [Abstract]  
Components of Loans Receivable
The loan portfolio consisted of the following (in thousands):
 
 
 
September 30, 2013
  
December 31, 2012
 
Commercial, financial and agricultural
 
$
423,073
  
$
315,655
 
Lease financing receivable
  
5,340
   
5,769
 
Real estate - construction
  
76,213
   
75,334
 
Real estate - commercial
  
401,080
   
414,384
 
Real estate - residential
  
142,431
   
142,858
 
Installment loans to individuals
  
94,722
   
90,561
 
Other
  
2,164
   
2,379
 
 
  
1,145,023
   
1,046,940
 
Less allowance for loan losses
  
(8,667
)
  
(7,370
)
 
 
$
1,136,356
  
$
1,039,570
 
Allowance for Loan Losses and Recorded Investment in Loans
A rollforward of the activity within the allowance for loan losses by loan type and recorded investment in loans for the nine months ended September 30, 2013 and 2012 is as follows (in thousands):
 
 
 
September 30, 2013
 
 
 
  
Real Estate
  
  
  
  
 
 
 
Coml, Fin,
and Agric
  
Construction
  
Commercial
  
Residential
  
Consumer
  
Finance
 Leases
 Coml
  
Other
  
Total
 
Allowance for loan losses:
 
  
  
  
  
  
  
  
 
Beginning balance
 
$
1,535
  
$
2,147
  
$
2,166
  
$
936
  
$
543
  
$
41
  
$
2
  
$
7,370
 
Charge-offs
  
(461
)
  
-
   
(18
)
  
(129
)
  
(558
)
  
-
   
-
   
(1,166
)
Recoveries
  
61
   
5
   
21
   
34
   
92
   
-
   
-
   
213
 
Provision
  
3,090
   
(1,081
)
  
(661
)
  
(46
)
  
962
   
(16
)
  
2
   
2,250
 
Ending balance
 
$
4,225
  
$
1,071
  
$
1,508
  
$
795
  
$
1,039
  
$
25
  
$
4
  
$
8,667
 
Ending balance:
                                
individually evaluated for impairment
 
$
419
  
$
36
  
$
54
  
$
55
  
$
134
  
$
-
  
$
-
  
$
698
 
Ending balance:
                                
collectively evaluated for impairment
 
$
3,806
  
$
1,035
  
$
1,454
  
$
740
  
$
905
  
$
25
  
$
4
  
$
7,969
 
 
                                
 
                                
Loans:
                                
Ending balance
 
$
423,073
  
$
76,213
  
$
401,080
  
$
142,431
  
$
94,722
  
$
5,340
  
$
2,164
  
$
1,145,023
 
Ending balance:
                                
individually evaluated for impairment
 
$
1,450
  
$
164
  
$
2,285
  
$
994
  
$
322
  
$
-
  
$
-
  
$
5,215
 
Ending balance:
                                
collectively evaluated for impairment
 
$
421,623
  
$
76,049
  
$
398,080
  
$
141,136
  
$
94,400
  
$
5,340
  
$
2,164
  
$
1,138,792
 
Ending balance:
                                
loans acquired with deteriorated credit quality
 
$
-
  
$
-
  
$
715
  
$
301
  
$
-
  
$
-
  
$
-
  
$
1,016
 
 
 
 
 
September 30, 2012
 
 
 
  
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
  
(683
)
  
-
   
(495
)
  
(126
)
  
(395
)
  
-
   
-
   
(1,699
)
Recoveries
  
169
   
9
   
-
   
3
   
66
   
-
   
-
   
247
 
Provision
  
574
   
378
   
282
   
114
   
197
   
4
   
1
   
1,550
 
Ending balance
 
$
1,794
  
$
2,048
  
$
2,002
  
$
927
  
$
578
  
$
23
  
$
2
  
$
7,374
 
Ending balance:
                                
individually evaluated for impairment
 
$
461
  
$
40
  
$
64
  
$
-
  
$
95
  
$
-
  
$
-
  
$
660
 
Ending balance:
                                
collectively evaluated for impairment
 
$
1,333
  
$
2,008
  
$
1,938
  
$
927
  
$
483
  
$
23
  
$
2
  
$
6,714
 
 
                                
Loans:
                                
Ending balance
 
$
266,046
  
$
57,727
  
$
293,579
  
$
110,735
  
$
73,334
  
$
5,041
  
$
2,371
  
$
808,833
 
Ending balance:
                                
individually evaluated for impairment
 
$
2,302
  
$
926
  
$
3,144
  
$
1,771
  
$
299
  
$
-
  
$
-
  
$
8,442
 
Ending balance:
                                
collectively evaluated for impairment
 
$
263,744
  
$
56,801
  
$
290,435
  
$
108,964
  
$
73,035
  
$
5,041
  
$
2,371
  
$
800,391
 
 
Age Analysis of Past Due Loans by Class of Loans
An age analysis of past due loans (including both accruing and non-accruing loans) is as follows (in thousands):
 
 
 
September 30, 2013 (1)
 
 
 
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
 
Commercial, financial, and agricultural
 
$
1,934
  
$
150
  
$
1,454
  
$
3,538
  
$
419,535
  
$
423,073
  
$
33
 
Commercial real estate - construction
  
58
   
-
   
129
   
187
   
57,674
   
57,861
   
-
 
Commercial real estate - other
  
3,815
   
102
   
2,903
   
6,820
   
394,260
   
401,080
   
665
 
Consumer - credit card
  
36
   
3
   
33
   
72
   
5,773
   
5,845
   
33
 
Consumer - other
  
510
   
53
   
325
   
888
   
87,989
   
88,877
   
13
 
Residential - construction
  
-
   
-
   
-
   
-
   
18,352
   
18,352
   
-
 
Residential - prime
  
1,968
   
144
   
1,064
   
3,176
   
139,255
   
142,431
   
-
 
Residential - subprime
  
-
   
-
   
-
   
-
   
-
   
-
   
-
 
Other loans
  
127
   
4
   
-
   
131
   
2,033
   
2,164
   
-
 
Finance leases commercial
  
-
   
-
   
-
   
-
   
5,340
   
5,340
   
-
 
 
 
$
8,448
  
$
456
  
$
5,908
  
$
14,812
  
$
1,130,211
  
$
1,145,023
  
$
744
 
 
 
 
December 31, 2012 (1)
 
 
 
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
 
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
  
4,123
   
2,108
   
3,577
   
9,808
   
404,576
   
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
   
239
   
1,121
   
2,500
   
140,358
   
142,858
   
-
 
Residential - subprime
  
-
   
-
   
-
   
-
   
-
   
-
   
-
 
Other loans
  
87
   
-
   
-
   
87
   
2,292
   
2,379
   
-
 
Finance leases commercial
  
-
   
-
   
-
   
-
   
5,769
   
5,769
   
-
 
 
 
$
8,081
  
$
2,900
  
$
7,580
  
$
18,561
  
$
1,028,379
  
$
1,046,940
  
$
1,986
 
Loans on Nonaccrual Status
Non-accrual loans are as follows (in thousands):
 
 
September 20, 2013 (1)
  
December 31, 2012 (1)
 
Commercial, financial, and agricultural
 
$
1,488
  
$
1,777
 
Commercial real estate – construction
  
166
   
941
 
Commercial real estate - other
  
2,363
   
3,009
 
Consumer - credit card
  
-
   
-
 
Consumer - other
  
352
   
409
 
Residential - construction
  
-
   
-
 
Residential - prime
  
1,391
   
2,140
 
Residential - subprime
  
-
   
-
 
Other loans
  
-
   
-
 
Finance leases commercial
  
-
   
-
 
 
 
$
5,760
  
$
8,276
 
 
(1) Balances have been adjusted from previously reported amounts for discounts associated with purchase credit impaired loans.
 
Impaired Loans by Class of Loans
Loans that are individually evaluated for impairment are as follows (in thousands):
 
 
 
September 30, 2013
 
 
 
Recorded
 Investment
  
Unpaid
 Principal
 Balance
  
Related
Allowance
  
Average
 Recorded
 Investment
  
Interest
Income
Recognized
 
With no related allowance recorded:
 
  
  
  
  
 
Commercial, financial, and agricultural
 
$
423
  
$
563
  
$
-
  
$
520
  
$
3
 
Commercial real estate – construction
  
63
   
63
   
-
   
64
   
-
 
Commercial real estate – other
  
1,921
   
2,395
   
-
   
2,137
   
6
 
Consumer – other
  
74
   
74
   
-
   
67
   
1
 
Residential – prime
  
576
   
596
   
-
   
622
   
5
 
Subtotal:
 
$
3,057
  
$
3,691
  
$
-
  
$
3,410
  
$
15
 
With an allowance recorded:
                    
Commercial, financial, and agricultural
  
1,027
   
1,141
   
419
   
1,029
   
2
 
Commercial real estate – construction
  
101
   
101
   
36
   
149
   
1
 
Commercial real estate – other
  
364
   
364
   
54
   
283
   
11
 
Consumer – other
  
248
   
248
   
134
   
252
   
1
 
Residential – prime
  
418
   
418
   
55
   
387
   
1
 
Subtotal:
 
$
2,158
  
$
2,272
  
$
698
  
$
2,100
  
$
16
 
Totals:
                    
Commercial
  
3,899
   
4,627
   
509
   
4,182
   
23
 
Consumer
  
322
   
322
   
134
   
319
   
2
 
Residential
  
994
   
1,014
   
55
   
1,009
   
6
 
Grand total:
 
$
5,215
  
$
5,963
  
$
698
  
$
5,510
  
$
31
 
 
 
 
 
December 31, 2012
 
 
 
Recorded
Investment
  
Unpaid
 Principal
 Balance
  
Related
 Allowance
  
Average
 Recorded
Investment
  
Interest
 Income
 Recognized
 
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
 
Credit Quality Indicators by Class of Loans
The following tables present the classes of loans by risk rating (in thousands):
 
 
September 30, 2013
Commercial Credit Exposure
Credit Risk Profile by
Creditworthiness Category
 
Commercial,
Financial, and
Agricultural
  
Commercial
Real Estate
Construction
  
Commercial
Real Estate
Other
  
 
Commercial
Total
  
 
% of Total
Commercial
Pass
 
$
415,480
  
$
56,932
  
$
378,331
  
$
850,743
   
96.46
%
Special mention
  
2,581
   
-
   
4,500
   
7,081
   
0.80
%
Substandard
  
4,771
   
929
   
18,145
   
23,845
   
2.70
%
Doubtful
  
241
   
-
   
104
   
345
   
0.04
%
 
 
$
423,073
  
$
57,861
  
$
401,080
  
$
882,014
   
100.00
%
 
Residential Credit Exposure
 
  
  
  
  
 
Credit Risk Profile by
Creditworthiness Category
 
  
  
  
  
 
 
 
Residential
Construction
  
Residential
Prime
  
Residential
Subprime
  
Residential
 Total
  
% of Total
 Residential
 
Pass
 
$
18,335
  
$
138,424
  
$
-
  
$
156,759
   
97.50
%
Special mention
  
-
   
727
   
-
   
727
   
0.45
%
Substandard
  
17
   
3,280
   
-
   
3,297
   
2.05
%
 
 
$
18,352
  
$
142,431
  
$
-
  
$
160,783
   
100.00
%
 
Consumer and Commercial Credit Exposure
  
  
  
  
  
 
Credit Risk Profile Based on
Payment Activity
 
  
  
  
  
  
 
 
 
Consumer
 Credit Card
  
Consumer
 Other
  
Finance
Leases
 Commercial
  
Other Loans
  
Total
  
% of Total
 
Performing
 
$
5,811
  
$
88,518
  
$
5,340
  
$
2,164
  
$
101,833
   
99.62
%
Nonperforming
  
34
   
359
   
-
   
-
   
393
   
0.38
%
 
 
$
5,845
  
$
88,877
  
$
5,340
  
$
2,164
  
$
102,226
   
100.00
%
 
 
 
 
December 31, 2012
 
Commercial Credit Exposure
 
  
  
  
  
 
Credit Risk Profile by Creditworthiness Category
 
  
  
  
  
 
 
 
Commercial,
 Financial, and
Agricultural
  
Commercial
 Real Estate
 Construction
  
Commercial
 Real Estate
 Other
  
Commercial
 Total
  
% of Total
Commercial
 
Pass
 
$
304,219
  
$
54,737
  
$
396,077
  
$
755,033
   
95.76
%
Special Mention
  
5,748
   
684
   
6,224
   
12,656
   
1.61
%
Substandard
  
4,503
   
2,925
   
7,514
   
14,942
   
1.90
%
Doubtful
  
1,185
   
4
   
4,569
   
5,758
   
0.73
%
 
 
$
315,655
  
$
58,350
  
$
414,384
  
$
788,389
   
100.00
%
 
Residential Credit Exposure
                    
Credit Risk Profile by Creditworthiness Category
                    
 
 
Residential
 Construction
  
Residential
Prime
  
Residential
Subprime
  
Residential
 Total
  
% of Total
 Residential
 
Pass
 
$
16,785
  
$
137,681
  
$
-
  
$
154,466
   
96.64
%
Special mention
  
-
   
1,612
   
-
   
1,612
   
1.01
%
Substandard
  
199
   
3,565
   
-
   
3,764
   
2.35
%
 
 
$
16,984
  
$
142,858
  
$
-
  
$
159,842
   
100.00
%

Consumer and Commercial Credit Exposure
  
  
  
  
  
 
Credit Risk Profile Based on Payment Activity
 
  
  
  
  
  
 
 
 
Consumer
Credit Card
  
Consumer
Other
  
Finance
Leases
 Commercial
  
Other Loans
  
Total
  
% of Total
 
Performing
 
$
6,792
  
$
83,347
  
$
5,769
  
$
2,379
  
$
98,287
   
99.57
%
Nonperforming
  
15
   
407
   
-
   
-
   
422
   
0.43
%
 
 
$
6,807
  
$
83,754
  
$
5,769
  
$
2,379
  
$
98,709
   
100.00
%
Modifications by Class of Loans
Information about the Company’s TDRs is as follows (in thousands):
 
 
 
September 30, 2013
 
 
 
Current
  
Past Due
 Greater than
30 Days
  
Nonaccrual
TDRs
  
Total TDRs
 
 
 
  
  
  
 
Commercial, financial, and agricultural
 
$
23
  
$
-
  
$
343
  
$
366
 
Real estate - commercial
  
167
   
-
   
-
   
167
 
 
 
$
190
  
$
-
  
$
343
  
$
533
 
 
 
 
 
December 31, 2012
 
 
 
Current
  
Past Due
Greater than
 30 Days
  
Nonaccrual
TDRs
  
Total TDRs
 
 
 
  
  
  
 
Commercial, financial, and agricultural
 
$
-
  
$
-
  
$
353
  
$
353
 
Real estate - commercial
  
4,709
   
-
   
-
   
4,709
 
 
 
$
4,709
  
$
-
  
$
353
  
$
5,062