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LOANS RECEIVABLE AND ALLOWANCE FOR LOAN LOSSES (Tables)
 9 Months Ended
Sep. 30, 2014
Loans and Leases Receivable Disclosure [Abstract]  
Summary of loans outstanding, by classification

Loans outstanding, by classification, are summarized as follows (in thousands):

 

    September 30,   December 31,
    2014   2013
         
Commercial, financial, and agricultural   $ 23,275     $ 20,292  
Commercial Real Estate     121,226       120,180  
Single-Family Residential     33,098       34,864  
Construction and Development     2,271       3,626  
Consumer     6,728       6,314  
      186,598       185,276  
Allowance for loan losses     2,554       3,157  
                 
    $ 184,044     $ 182,119  
Summary of activity in allowance for loan losses

Activity in the allowance for loan losses for the nine months ended September 30, 2014 and 2013 and the year ended December 31, 2013 is summarized as follows (in thousands):

 

    September 30,   December 31,   September 30,
    2014   2013   2013
             
Balance at beginning of period   $ 3,157     $ 3,509     $ 3,509  
Provision for loan losses     —         425       450  
Loans charged-off     (818 )     (1,485 )     (1,423 )
Recoveries on loans previously charged-off     215       708       580  
Balance at end of period   $ 2,554     $ 3,157     $ 3,116  
Summary of activity in the allowance for loan losses by portfolio segment

Activity in the allowance for loan losses by portfolio segment is summarized as follows (in thousands):

 

    For the Three Month Period Ended September 30, 2014
    Commercial   Commercial Real Estate   Single-family Residential   Construction & Development   Consumer   Total
Beginning balance   $ 251     $ 1,913     $ 508     $ 139     $ 147     $ 2,958  
Provision for loan losses     206       (140 )     (162 )     52       44       —    
Loans charged-off     (7 )     (108 )     (162 )     (137 )     (46 )     (460 )
Recoveries on loans charged-off     6       9       23       —         18       56  
Ending Balance     $ 4 56     $ 1,674     $ 207     $ 54     $ 163     $ 2,554  

 

    For the Nine Month Period Ended September 30, 2014
    Commercial   Commercial Real Estate   Single-family Residential   Construction & Development   Consumer   Total
Beginning balance   $ 384     $ 1,721     $ 731     $ 126     $ 195     $ 3,157  
Provision for loan losses     49       167       (352 )     65       71       —    
Loans charged-off     (7 )     (244 )     (286 )     (137 )     (144 )     (818 )
Recoveries on loans charged-off     30       30       114       —         41       215  
Ending Balance   $ 456     $ 1,674     $ 207     $ 54     $ 163     $ 2,554  

 

    For the Three Month Period Ended September 30, 2013
    Commercial   Commercial Real Estate   Single-family Residential   Construction & Development   Consumer   Total
Beginning balance   $ 168     $ 2,180     $ 606     $ 156     $ 304     $ 3,414  
Provision for loan losses     (65 )     (64 )     243       139       (78 )     175  
Loans charged-off     (16 )     (338 )     (234 )     —         (27 )     (615 )
Recoveries on loans charged-off     8       2       83       35       14       142  
Ending Balance   $ 95     $ 1,780     $ 698     $ 330     $ 213     $ 3,116  

 

    For the Nine Month Period Ended September 30, 2013
    Commercial   Commercial Real Estate   Single-family Residential   Construction & Development   Consumer   Total
Beginning balance   $ 433     $ 1,853     $ 803       $ 1 77     $ 243     $ 3,509  
Provision for loan losses     (342 )     281       302       148       61       450  
Loans charged-off     (22 )     (711 )     (518 )     (30 )     (142 )     (1,423 )
Recoveries on loans charged-off     26       357       111       35       51       580  
Ending Balance   $ 95     $ 1,780     $ 698     $ 330     $ 213     $ 3,116  

 

    For the Year Ended December, 2013
    Commercial   Commercial Real Estate   Single-family Residential   Construction & Development   Consumer   Total
Beginning balance   $ 433     $ 1,853     $ 803     $ 177     $ 243     $ 3,509  
Provision for loan losses     (68 )     127       361       (56 )     61       425  
Loans charged-off     (22 )     (710 )     (554 )     (30 )     (169 )     (1,485 )
Recoveries on loans charged-off     41       451       121       35       60       708  
Ending Balance   $ 384     $ 1,721     $ 731     $ 126     $ 195     $ 3,157  
Schedule of allocation of allowance for loan losses by portfolio segment

The allocation of the allowance for loan losses by portfolio segment was as follows (in thousands):

 

    At September 30, 2014
    Commercial   Commercial Real Estate   Single-family Residential   Construction & Development   Consumer   Total
Specific reserves impaired loans   $ —       $ 325     $ 51     $ —       $ —       $ 376  
General reserves     456       1,349       156       54       163       2,178  
Total   $ 456     $ 1,674     $ 207     $ 54     $ 163     $ 2,554  
                                                 
Loans individually evaluated for impairment   $ —       $ 7,771     $ 578     $ 220     $ —       $ 8,569  
Loans collectively evaluated for impairment     23,275       113,455       32,520       2,051       6,728       178,029  
Total   $ 23,275     $ 121,226     $ 33,098     $ 2,271     $ 6,728     $ 186,598  

 

    At December 31, 2013
    Commercial   Commercial Real Estate   Single-family Residential   Construction & Development   Consumer   Total
Specific reserves impaired loans   $ —       $ 3     $ —       $ —       $ —       $ 3  
General reserves     384       1,718       731       126       195       3,154  
Total   $ 384     $ 1,721     $ 731     $ 126     $ 195     $ 3,157  
                                                 
Loans individually evaluated for impairment   $ —       $ 10,705     $ 360     $ —       $ —       $ 11,065  
Loans collectively evaluated for impairment     20,292       109,475       34,504       3,626       6,314       174,211  
Total   $ 20,292     $ 120,180     $ 34,864     $ 3,626     $ 6,314     $ 185,276
Schedule of impaired loans by class of loan

The following table presents impaired loans by class of loan (in thousands):

 

    At September 30, 2014
                Impaired Loans - With
    Impaired Loans - With Allowance   no Allowance
    Unpaid Principal   Recorded Investment   Allowance for Loan Losses Allocated   Unpaid Principal   Recorded Investment
Residential:                                        
First mortgages   $ —       $ —       $ —       $ 231     $ 231  
HELOC’s and equity     102       102       51       256       245  
Commercial                                        
Secured     —         —         —         —         —    
Unsecured     —         —         —         —         —    
Commercial Real Estate:                                        
Owner occupied     832       832       253       5,530       4,711  
Non-owner occupied     853       789       62       1,582       1,333  
Multi-family     96       96       10       —         —    
Construction and Development:                                        
Construction     —         —         —         357       220  
Improved Land     —         —         —         —         —    
Unimproved Land     —         —         —         —         —    
Consumer and Other     —         —         —         —         —    
Total   $ 1,883     $ 1,829     $ 376     $ 7,956     $ 6,740  

 

The following table presents the average recorded investment and interest income recognized on impaired loans by class of loan (in thousands):

 

    September 30, 2014   September 30, 2013
    Average Recorded Investment   Interest Income Recognized   Average Recorded Investment   Interest Income Recognized
Residential:                                
First mortgages   $ 231     $ —       $ 231     $ —    
HELOC’s and equity     274       24       128       2  
Commercial                                
Secured     —         —         30       —    
Unsecured     —         —         —         —    
Commercial Real Estate:                                
Owner occupied     5,637       603       6,049       337  
Non-owner occupied     2,216       79       2,367       83  
Multi-family     97       51       363       16  
Construction and Development:              .                .  
Construction     292       27       —         —    
Improved Land     —         —         —         —    
Unimproved Land     —         —         —         —    
Consumer and Other     —         —         —         —    
Total   $ 8,747     $ 784     $ 9,168     $ 438  

 

    At December 31, 2013
                Impaired Loans - With        
    Impaired Loans - With Allowance   no Allowance        
    Unpaid Principal   Recorded Investment   Allowance for Loan Losses Allocated   Unpaid Principal   Recorded Investment   Average Recorded Investment   Interest Income Recognized
Residential:                                                        
First mortgages   $ —       $ —       $ —       $ 231     $ 231     $ 231     $ —    
HELOC’s and equity     —         —         —         129       129       128       2  
Commercial                                                        
Secured     —         —         —         —         —         —         —    
Unsecured     —         —         —         —         —         —         —    
Commercial Real Estate:                                                        
Owner occupied     —         —         —         10,300       7,968       8,049       534  
Non-owner occupied     —         —         —         2,924       2,407       2,516       108  
Multi-family     386       330       3       —         —         359       28  
Construction and Development                                                      .  
Construction     —         —         —         —         —         —         —    
Improved Land     —         —         —         —         —         —         —    
Unimproved Land     —         —         —         —         —         —         —    
Consumer and Other     —         —                 —         —         —         —    
Total   $ 386     $ 330     $ 3     $ 13,584     $ 10,735     $ 11,283     $ 672
Schedule of aging analysis of loan portfolio

The following table is an aging analysis of our loan portfolio (in thousands):

 

    At September 30, 2014
    30- 59 Days Past Due   60- 89 Days Past Due   Over 90 Days Past Due   Total Past Due   Current   Total Loans Receivable   Recorded Investment > 90 Days and  Accruing   Nonaccrual
Residential:                                                                
First mortgages   $ —       $ 326     $ 1,144     $ 1,470     $ 23,950     $ 25,420     $ 35     $ 1,905  
HELOC’s and equity     164       400       423       987       6,691       7,678       —         525  
Commercial:                                                                
Secured     —         28       2       30       18,262       18,292       —         2  
Unsecured     —         —         —         —         4,983       4,983       —         —    
Commercial Real Estate:                                                        
Owner occupied     14       107       528       649       61,750       62,399       —         1,546  
Non-owner occupied     733       325       914       1,972       42,515       44,487       —         1,863  
Multi-family     —         493       —         493       13,847       14,340       —         —    
Construction and  Development:                                                                
Construction     —         —         —         —         2,077       2,077       —         —    
Improved Land     —         —         —         —         194       194       —         —    
Unimproved Land     —         —         —         —         —         —         —         —    
Consumer and Other     45       28       26       99       6,629       6,728       —         26  
Total   $ 956     $ 1,707     $ 3,037     $ 5,700     $ 180,898     $ 186,598     $ 35     $ 5,867  

 

    At December 31, 2013
    30- 59 Days Past Due   60- 89 Days Past Due   Over 90 Days Past Due   Total Past Due   Current   Total Loans Receivable   Recorded Investment > 90 Days and  Accruing   Nonaccrual
Residential:                                                                
First mortgages   $ 1,778     $ 360     $ 1,840     $ 3,978     $ 22,348     $ 26,326     $ —       $ 3,334  
HELOC’s and equity     444       19       466       929       7,609       8,538       —         821  
Commercial:                                                                
Secured     125       —         2       127       14,906       15,033       —         2  
Unsecured     —         —         —         —         5,259       5,259       —         —    
Commercial Real Estate:                                                                
Owner occupied     715       753       81       1,549       60,090       61,639       —         1,038  
Non-owner occupied     38       199       286       523       43,287       43,810       —         1,550  
Multi-family     747       —         —         747       13,984       14,731       —         330  
Construction and  Development:                                                                
Construction     477       —         —         477       2,542       3,019       —         —    
Improved Land     —         —         —         —         242       242       —         —    
Unimproved Land     —         —         —         —         365       365       —         —    
Consumer and Other     6       30       45       81       6,233       6,314       —         45  
Total   $ 4,330     $ 1,361     $ 2,720     $ 8,411     $ 176,865     $ 185,276     $ —       $ 7,120  
Schedule of loan portfolio by risk rating

The following table presents our loan portfolio by risk rating (in thousands):

 

    At September 30, 2014
    Total   Pass Credits   Special Mention   Substandard   Doubtful
Residential:                                        
First mortgages   $ 25,420     $ 23,949     $ —       $ 1,471     $ —    
HELOC’s and equity     7,678       6,266       558       679       175  
Commercial:                                        
Secured     18,292       18,292       —         —         —    
Unsecured     4,983       4,983       —         —         —    
Commercial Real Estate:                                        
Owner occupied     62,399       52,046       7,437       2,916       —    
Non-owner occupied     44,487       37,947       4,482       1,997       61  
Multi-family     14,340       12,835       1,371       134       —    
Construction and Development:                                        
Construction     2,077       1,857       —         220       —    
Improved Land     194       153       —         41       —    
Unimproved Land     —         —         —         —         —    
Consumer and Other     6,728       6,681       —         37       10  
Total   $ 186,598     $ 165,009     $ 13,848     $ 7,495     $ 246  

 

    At December 31, 2013
    Total   Pass Credits   Special Mention   Substandard   Doubtful
Residential:                                        
First mortgages   $ 26,326     $ 24,126     $ —       $ 2,200     $ —    
HELOC’s and equity     8,538       7,686       22       728       102  
Commercial:                                        
Secured     15,033       15,009       —         24       —    
Unsecured     5,259       5,259       —         —         —    
Commercial Real Estate:                                        
Owner occupied     61,639       50,921       5,929       4,789       —    
Non-owner occupied     43,810       40,482       819       2,509       —    
Multi-family     14,731       13,704       647       380       —    
Construction and Development:                                        
Construction     3,019       3,019       —         —         —    
Improved Land     242       197       —         45       —    
Unimproved Land     365       —         —         365       —    
Consumer and Other     6,314       6,224       —         90       —    
Total   $ 185,276     $ 166,627     $ 7,417     $ 11,130     $ 102
Schedule of troubled debt restructurings

During the three and nine months ended September 30, 2014 the bank modified 1 loans that was considered to be troubled debt restructurings. We extended the term and decreased the interest rate on the loan (dollars in thousands).

 

Extended Terms and Decreased Interest Rate

 

    Three months ended September 30, 2014
    Number of Loans   Pre-Modification Recorded Investment   Post-Modification Recorded Investment
Troubled Debt Restructurings                        
Residential mortgages     1     $ 68     $ 68  
Total     1     $ 68     $ 68  

 

    Nine months ended September 30, 2014
    Number of Loans   Pre-Modification Recorded Investment   Post-Modification Recorded Investment
Residential mortgages     1     $ 68     $ 68  
Total     1     $ 68     $ 68  

 

During the three and nine months ended September 30, 2013, the Bank modified 5 and 13 loans, respectively that were considered to be troubled debt restructurings. We extended the terms and decreased the interest rate on 3 and 9 loans during the three and nine months ended September 30, 2013. We decreased the interest rate on 2 loans during the nine months ended September 30, 2013. We extended the terms on two loans during each of the three and nine months ended September 30, 2013, respectively. (dollars in thousands)

 

Extended Terms and Decreased Interest Rate

 

    Three months ended September 30, 2013
    Number of Loans   Pre-Modification Recorded Investment   Post-Modification Recorded Investment
Troubled Debt Restructurings                        
Residential mortgages     1     $ 82     $ 82  
Commercial Real Estate:                        
Non-owner occupied     2       390       390  
Total     3     $ 472     $ 472  

 

    Nine months ended September 30, 2013
    Number of Loans   Pre-Modification Recorded Investment   Post-Modification Recorded Investment
Residential mortgages     3     $ 417     $ 423  
Commercial Real Estate:                        
Owner occupied     2       252       258  
Non-owner occupied     4       1,586       1,571  
Total     9     $ 2,255     $ 2,252  

 

Decreased Interest Rate Only

 

There were no loans with a decreased interest rate only for the three months ended September 30, 2013.

 

    Nine months ended September 30, 2013
    Number of Loans   Pre-Modification Recorded Investment   Post-Modification Recorded Investment
Residential mortgages     2     $ 140     $ 140  
Total     2     $ 140     $ 140  

 

 

Extended Term Only

 

    Three months ended September 30, 2013
    Number of Loans   Pre-Modification Recorded Investment   Post-Modification Recorded Investment
Troubled Debt Restructurings                        
Residential mortgages     1     $ 14     $ 14  
Commercial Real Estate:                        
Non-owner occupied     1       386       386  
Total     2     $ 400     $ 400  

 

    Nine months ended September 30, 2013
    Number of Loans   Pre-Modification Recorded Investment   Post-Modification Recorded Investment
Residential mortgages     1     $ 14     $ 14  
Commercial Real Estate:                        
Non-owner occupied     1       386       386  
Total     2     $ 400     $ 400