Loans (Tables)

6 Months Ended

Jun. 30, 2017

Receivables [Abstract]

Summary of Loans

Loans consist of the following:

(Dollars in thousands)	June 30, 2017		December 31, 2016
Commercial	$	141,285	$	134,268
Commercial real estate		168,812		159,475
Residential real estate		151,126		144,489
Construction & land development		20,705		23,428
Consumer		16,173		13,308
Total loans before deferred costs		498,101		474,968
Deferred loan costs		524		481
Total Loans	$	498,625	$	475,449

Schedule of Allowances for Loan Losses by Portfolio Segment

The following tables detail activity in the allowance for loan losses by portfolio segment for the three and six months ended June 30, 2017 and 2016.

(Dollars in thousands)	Commercial			Commercial Real Estate			Residential Real Estate			Construction & Land Development		Consumer			Unallocated			Total
Three months ended June 30, 2017
Beginning balance	$	1,704		$	1,538		$	1,303		$	184	$	165		$	560		$	5,454
Provision for loan losses		675			180			(47	)		38		18			(19	)		845
Charge-offs		(32	)		—			—			—		(2	)					(34	)
Recoveries		15			—			8			—		1						24
Net charge-offs		(17	)		—			8			—		(1	)					(10	)
Ending balance	$	2,362		$	1,718		$	1,264		$	222	$	182		$	541		$	6,289
Six months ended June 30, 2017
Beginning balance	$	2,207		$	1,264		$	1,189		$	178	$	141		$	312		$	5,291
Provision for loan losses		(156	)		454			67			44		47			229			685
Charge-offs		(40	)		—			—			—		(7	)		—			(47	)
Recoveries		351			—			8			—		1			—			360
Net charge-offs		311			—			8			—		(6	)		—			313
Ending balance	$	2,362		$	1,718		$	1,264		$	222	$	182		$	541		$	6,289
Three months ended June 30, 2016
Beginning balance	$	2,053		$	1,225		$	1,084		$	106	$	94		$	443		$	5,005
Provision for loan losses		326			48			11			21		16			(257	)		165
Charge-offs		(6	)		(12	)		—			—		—						(18	)
Recoveries		3			1			—			—		—						4
Net charge-offs		(3	)		(11	)		—			—		—						(14	)
Ending balance	$	2,376		$	1,262		$	1,095		$	127	$	110		$	186		$	5,156
Six months ended June 30, 2016
Beginning balance	$	1,664		$	1,271		$	1,086		$	123	$	86		$	432		$	4,662
Provision for loan losses		720			(180	)		7			4		24			(246	)		329
Charge-offs		(15	)		(12	)		—			—		(1	)					(28	)
Recoveries		7			183			2			—		1						193
Net charge-offs		(8	)		171			2			—		—						165
Ending balance	$	2,376		$	1,262		$	1,095		$	127	$	110		$	186		$	5,156

Allowances for Loan Losses and Ending Balances by Portfolio Class and Based on Impairment Method

The following table presents the balance in the allowance for loan losses and the ending loan balances by portfolio class and based on the impairment method as of June 30, 2017 and December 31, 2016:

(Dollars in thousands)	Commercial		Commercial Real Estate		Residential Real Estate		Construction & Land Development		Consumer		Unallocated		Total
June 30, 2017
Allowance for loan losses:
Individually evaluated for impairment	$	573	$	243	$	25	$	—	$	—	$	—	$	841
Collectively evaluated for impairment		1,789		1,475		1,239		222		182		541		5,448
Total ending allowance balance	$	2,362	$	1,718	$	1,264	$	222	$	182	$	541	$	6,289
Loans:
Loans individually evaluated for impairment	$	3,169	$	3,693	$	1,465	$	—	$	—			$	8,327
Loans collectively evaluated for impairment		138,116		165,119		149,661		20,705		16,173				489,774
Total ending loans balance	$	141,285	$	168,812	$	151,126	$	20,705	$	16,173			$	498,101
December 31, 2016
Allowance for loan losses:
Individually evaluated for impairment	$	705	$	—	$	24	$	—	$	—	$	—	$	729
Collectively evaluated for impairment		1,502		1,264		1,165		178		141		312		4,562
Total ending allowance balance	$	2,207	$	1,264	$	1,189	$	178	$	141	$	312	$	5,291
Loans:
Loans individually evaluated for impairment	$	5,028	$	621	$	1,507	$	—	$	—			$	7,156
Loans collectively evaluated for impairment		129,240		158,854		142,982		23,428		13,308				467,812
Total ending loans balance	$	134,268	$	159,475	$	144,489	$	23,428	$	13,308			$	474,968

Schedule of Impairment by Class of Loans

The following table presents loans individually evaluated for impairment by class of loans as of June 30, 2017 and December 31, 2016:

(Dollars in thousands)	Unpaid Principal Balance		Recorded Investment with no Allowance		Recorded Investment with Allowance		Total Recorded Investment		Related Allowance
June 30, 2017
Commercial	$	3,181	$	1,012	$	2,160	$	3,172	$	573
Commercial real estate		3,884		2,456		1,237		3,693		243
Residential real estate		1,643		1,059		409		1,468		25
Total impaired loans	$	8,708	$	4,527	$	3,806	$	8,333	$	841
December 31, 2016
Commercial	$	5,476	$	1,690	$	3,354	$	5,044	$	705
Commercial real estate		796		600		21		621		—
Residential real estate		1,681		1,036		472		1,508		24
Total impaired loans	$	7,953	$	3,326	$	3,847	$	7,173	$	729

Schedule of Average Recorded Investment in Impaired Loans and Related Interest Income Recognized

The following table presents the average recorded investment in impaired loans and related interest income recognized for the periods indicated.

	Three months ended June 30,				Six months ended June 30,
(Dollars in thousands)	2017		2016		2017		2016
Average recorded investment:
Commercial	$	2,794	$	6,579	$	3,505	$	6,360
Commercial real estate		3,600		746		2,019		865
Residential real estate		1,540		1,497		1,514		1,518
Average recorded investment in impaired loans	$	7,934	$	8,822	$	7,038	$	8,743
Interest income recognized:
Commercial	$	17	$	56	$	31	$	122
Commercial real estate		2		2		2		6
Residential real estate		15		14		30		29
Interest income recognized on a cash basis on impaired loans	$	34	$	72	$	63	$	157

Schedule of Aging of Past Due and Nonaccrual Loans

The following table presents the aging of past due loans and nonaccrual loans as of June 30, 2017 and December 31, 2016 by class of loans:

(Dollars in thousands)	Current		30 - 59 Days Past Due		60 - 89 Days Past Due		90 Days + Past Due		Non-Accrual		Total Past Due and Non- Accrual		Total Loans
June 30, 2017
Commercial	$	139,066	$	147	$	—	$	—	$	2,072	$	2,219	$	141,285
Commercial real estate		165,328		58		—		39		3,387		3,484		168,812
Residential real estate		150,426		174		18		30		478		700		151,126
Construction & land development		20,705		—		—		—		—		—		20,705
Consumer		16,047		87		9		—		30		126		16,173
Total Loans	$	491,572	$	466	$	27	$	69	$	5,967	$	6,529	$	498,101
December 31, 2016
Commercial	$	133,630	$	151	$	62	$	—	$	425	$	638	$	134,268
Commercial real estate		158,504		435		—		39		497		971		159,475
Residential real estate		142,926		816		61		196		490		1,563		144,489
Construction & land development		23,428		—		—		—		—		—		23,428
Consumer		13,234		21		16		—		37		74		13,308
Total Loans	$	471,722	$	1,423	$	139	$	235	$	1,449	$	3,246	$	474,968

Summary of Troubled Debt Restructurings

The following table presents loans restructured during the three and six month periods ended June 30, 2017 and 2016.

(Dollars in thousands)	Number of loans restructured		Pre-Modification Recorded Investment		Post- Modification Recorded Investment
For the three months ended June 30, 2017
Commercial Real Estate		4	$	288	$	288
Residential Real Estate		1		14		14
Total Restructured Loans		5	$	302	$	302
For the six months ended June 30, 2017
Commercial Real Estate		4	$	288	$	288
Residential Real Estate		1		14		14
Total Restructured Loans		5	$	302	$	302
For the three months ended June 30, 2016
Residential Real Estate		3	$	327	$	327
Total Restructured Loans		3	$	327	$	327
For the six months ended June 30, 2016
Residential Real Estate		3	$	327	$	327
Total Restructured Loans		3	$	327	$	327

Summary of Loans by Credit Quality Indicator

Based on the most recent analysis performed, the risk category of loans by class is as follows as of June 30, 2017 and December 31, 2016:

(Dollars in thousands)	Pass		Special Mention		Substandard		Doubtful		Not Rated		Total
June 30, 2017
Commercial	$	114,648	$	17,640	$	8,180	$	—	$	817	$	141,285
Commercial real estate		152,806		10,480		5,008		—		518		168,812
Residential real estate		211		—		112		—		150,803		151,126
Construction & land development		15,282		1,423		648		—		3,352		20,705
Consumer		—		—		—		—		16,173		16,173
Total	$	282,947	$	29,543	$	13,948	$	—	$	171,663	$	498,101
December 31, 2016
Commercial	$	116,739	$	6,874	$	9,704	$	—	$	951	$	134,268
Commercial real estate		149,630		4,168		4,766		—		911		159,475
Residential real estate		216		—		175		—		144,098		144,489
Construction & land development		17,183		981		504		—		4,760		23,428
Consumer		—		—		—		—		13,308		13,308
Total	$	283,768	$	12,023	$	15,149	$	—	$	164,028	$	474,968

Schedule of Loans Not Rated by Class of Loans

The following table presents loans that are not rated by class of loans as of June 30, 2017 and December 31, 2016. Nonperforming loans include loans past due 90 days or more and loans on nonaccrual of interest status.

(Dollars in thousands)	Performing		Non-Performing		Total
June 30, 2017
Commercial	$	817	$	—	$	817
Commercial real estate		518		—		518
Residential real estate		150,295		508		150,803
Construction & land development		3,352		—		3,352
Consumer		16,143		30		16,173
Total	$	171,125	$	538	$	171,663
December 31, 2016
Commercial	$	951	$	—	$	951
Commercial real estate		911		—		911
Residential real estate		143,440		658		144,098
Construction & land development		4,760		—		4,760
Consumer		13,271		37		13,308
Total	$	163,333	$	695	$	164,028