Loans (Tables)

9 Months Ended

Sep. 30, 2017

Receivables [Abstract]

Summary of Loans

Loans consist of the following:

(Dollars in thousands)	September 30, 2017		December 31, 2016
Commercial	$	137,459	$	134,268
Commercial real estate		177,588		159,475
Residential real estate		153,281		144,489
Construction & land development		23,915		23,428
Consumer		16,686		13,308
Total loans before deferred costs		508,929		474,968
Deferred loan costs		529		481
Total Loans	$	509,458	$	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 nine months ended September 30, 2017 and 2016.  

(Dollars in thousands)	Commercial			Commercial Real Estate			Residential Real Estate			Construction & Land Development		Consumer			Unallocated			Total
Three months ended September 30, 2017
Beginning balance	$	2,362		$	1,718		$	1,264		$	222	$	182		$	541		$	6,289
Provision for loan losses		881			(88	)		(53	)		21		(5	)		(476	)		280
Charge-offs		(1,138	)		—			—			—		—						(1,138	)
Recoveries		4			—			—			—		1						5
Net charge-offs		(1,134	)		—			—			—		1						(1,133	)
Ending balance	$	2,109		$	1,630		$	1,211		$	243	$	178		$	65		$	5,436
Nine months ended September 30, 2017
Beginning balance	$	2,207		$	1,264		$	1,189		$	178	$	141		$	312		$	5,291
Provision for loan losses		725			366			14			65		42			(247	)		965
Charge-offs		(1,178	)		—			—			—		(7	)					(1,185	)
Recoveries		355			—			8			—		2						365
Net charge-offs		(823	)		—			8			—		(5	)					(820	)
Ending balance	$	2,109		$	1,630		$	1,211		$	243	$	178		$	65		$	5,436
Three months ended September 30, 2016
Beginning balance	$	2,376		$	1,262		$	1,095		$	127	$	110		$	186		$	5,156
Provision for loan losses		77			63			50			24		74			(124	)		164
Charge-offs		(261	)		(38	)		—			—		(47	)					(346	)
Recoveries		27			—			1			—		—						28
Net charge-offs		(234	)		(38	)		1			—		(47	)					(318	)
Ending balance	$	2,219		$	1,287		$	1,146		$	151	$	137		$	62		$	5,002
Nine months ended September 30, 2016
Beginning balance	$	1,664		$	1,271		$	1,086		$	123	$	86		$	432		$	4,662
Provision for loan losses		797			(117	)		57			28		98			(370	)		493
Charge-offs		(276	)		(50	)		—			—		(48	)					(374	)
Recoveries		34			183			3			—		1						221
Net charge-offs		(242	)		133			3			—		(47	)					(153	)
Ending balance	$	2,219		$	1,287		$	1,146		$	151	$	137		$	62		$	5,002

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 September 30, 2017 and December 31, 2016:

(Dollars in thousands)	Commercial		Commercial Real Estate		Residential Real Estate		Construction & Land Development		Consumer		Unallocated		Total
September 30, 2017
Allowance for loan losses:
Individually evaluated for impairment	$	5	$	20	$	24	$	—	$	—	$	—	$	49
Collectively evaluated for impairment		2,104		1,610		1,187		243		178		65		5,387
Total ending allowance balance	$	2,109	$	1,630	$	1,211	$	243	$	178	$	65	$	5,436
Loans:
Loans individually evaluated for impairment	$	1,241	$	3,703	$	1,486	$	—	$	—			$	6,430
Loans collectively evaluated for impairment		136,218		173,885		151,795		23,915		16,686				502,499
Total ending loans balance	$	137,459	$	177,588	$	153,281	$	23,915	$	16,686			$	508,929
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 September 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
September 30, 2017
Commercial	$	2,868	$	1,238	$	5	$	1,243	$	5
Commercial real estate		3,901		3,653		51		3,704		20
Residential real estate		1,667		1,095		392		1,487		24
Total impaired loans	$	8,436	$	5,986	$	448	$	6,434	$	49
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 September 30,				Nine months ended September 30,
(Dollars in thousands)	2017		2016		2017		2016
Average recorded investment:
Commercial	$	3,084	$	6,389	$	3,376	$	6,393
Commercial real estate		4,712		660		2,934		799
Residential real estate		1,370		1,460		1,471		1,504
Average recorded investment in impaired loans	$	9,166	$	8,509	$	7,781	$	8,696
Interest income recognized:
Commercial	$	10	$	54	$	41	$	176
Commercial real estate		7		3		9		9
Residential real estate		13		15		43		44
Interest income recognized on a cash basis on impaired loans	$	30	$	72	$	93	$	229

Schedule of Aging of Past Due and Nonaccrual Loans

The following table presents the aging of past due loans and nonaccrual loans as of September 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
September 30, 2017
Commercial	$	136,544	$	28	$	—	$	144	$	743	$	915	$	137,459
Commercial real estate		173,989		160		—		40		3,399		3,599		177,588
Residential real estate		151,684		914		108		68		507		1,597		153,281
Construction & land development		23,915		—		—		—		—		—		23,915
Consumer		16,561		87		9		1		28		125		16,686
Total Loans	$	502,693	$	1,189	$	117	$	253	$	4,677	$	6,236	$	508,929
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 nine month periods ended September 30, 2017 and 2016.

(Dollars in thousands)	Number of loans restructured		Pre- Modification Recorded Investment		Post- Modification Recorded Investment
For the three months ended September 30, 2017
Residential Real Estate		1	$	38	$	38
Total Restructured Loans		1	$	38	$	38
For the nine months ended September 30, 2017
Commercial Real Estate		4	$	288	$	288
Residential Real Estate		2		52		52
Total Restructured Loans		6	$	340	$	340
For the three months ended September 30, 2016
Residential Real Estate		—	$	—	$	—
Total Restructured Loans		—	$	—	$	—
For the nine months ended September 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 September 30, 2017 and December 31, 2016:

(Dollars in thousands)	Pass		Special Mention		Substandard		Doubtful		Not Rated		Total
September 30, 2017
Commercial	$	115,301	$	16,167	$	5,130	$	—	$	861	$	137,459
Commercial real estate		160,677		9,933		6,744		—		234		177,588
Residential real estate		208		—		183		—		152,890		153,281
Construction & land development		18,171		1,410		—		—		4,334		23,915
Consumer		—		—		—		—		16,686		16,686
Total	$	294,357	$	27,510	$	12,057	$	—	$	175,005	$	508,929
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 September 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
September 30, 2017
Commercial	$	861	$	—	$	861
Commercial real estate		234		—		234
Residential real estate		152,315		575		152,890
Construction & land development		4,334		—		4,334
Consumer		16,657		29		16,686
Total	$	174,401	$	604	$	175,005
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