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LOANS (Tables)
 6 Months Ended
Jun. 30, 2015
LOANS [Abstract]  
Major Classifications of Loans
Major classifications of loans at June 30, 2015 and December 31, 2014 are summarized as follows:

  
2015
  
2014
 
Residential real estate
 
$
282,923
  
$
278,212
 
Multifamily real estate
  
37,112
   
30,310
 
Commercial real estate:
        
Owner occupied
  
122,879
   
120,861
 
Non owner occupied
  
217,881
   
230,750
 
Commercial and industrial
  
76,193
   
85,943
 
Consumer
  
31,561
   
32,745
 
All other
  
115,324
   
100,890
 
  
$
883,873
  
$
879,711
 
Activity in the Allowance for Loan Losses by Portfolio Segment
Activity in the allowance for loan losses by portfolio segment for the six months ended June 30, 2015 was as follows:

Loan Class
 
Balance
Dec 31, 2014
  
Provision (credit)
for loan losses
  
Loans charged-off
  
Recoveries
  
Balance
June 30, 2015
 
           
Residential real estate
 
$
2,093
  
$
372
  
$
78
  
$
79
  
$
2,466
 
Multifamily real estate
  
304
   
208
   
-
   
-
   
512
 
Commercial real estate:
                    
Owner occupied
  
1,501
   
(24
)
  
2
   
1
   
1,476
 
Non owner occupied
  
2,316
   
(643
)
  
-
   
659
   
2,332
 
Commercial and industrial
  
1,444
   
(140
)
  
169
   
4
   
1,139
 
Consumer
  
243
   
105
   
132
   
58
   
274
 
All other
  
2,446
   
45
   
112
   
116
   
2,495
 
Total
 
$
10,347
  
$
(77
)
 
$
493
  
$
917
  
$
10,694
 

Activity in the allowance for loan losses by portfolio segment for the six months ending June 30, 2014 was as follows:

Loan Class
 
Balance
Dec 31, 2013
  
Provision (credit)
for loan losses
  
Loans charged-off
  
Recoveries
  
Balance
June 30, 2014
 
           
Residential real estate
 
$
2,694
  
$
(391
)
 
$
171
  
$
8
  
$
2,140
 
Multifamily real estate
  
417
   
(106
)
  
-
   
-
   
311
 
Commercial real estate:
                    
Owner occupied
  
1,407
   
39
   
82
   
-
   
1,364
 
Non owner occupied
  
2,037
   
556
   
323
   
-
   
2,270
 
Commercial and industrial
  
2,184
   
(616
)
  
84
   
5
   
1,489
 
Consumer
  
297
   
(33
)
  
59
   
27
   
232
 
All other
  
1,991
   
162
   
204
   
122
   
2,071
 
Total
 
$
11,027
  
$
(389
)
 
$
923
  
$
162
  
$
9,877
 
 
Activity in the allowance for loan losses by portfolio segment for the three months ended June 30, 2015 was as follows:

Loan Class
 
Balance
March 31, 2015
  
Provision (credit)
for loan losses
  
Loans charged-off
  
Recoveries
  
Balance
June 30, 2015
 
           
Residential real estate
 
$
2,196
  
$
218
  
$
4
  
$
56
  
$
2,466
 
Multifamily real estate
  
287
   
225
   
-
   
-
   
512
 
Commercial real estate:
                    
Owner occupied
  
1,489
   
(13
)
  
-
   
-
   
1,476
 
Non owner occupied
  
2,324
   
(651
)
  
-
   
659
   
2,332
 
Commercial and industrial
  
1,450
   
(305
)
  
8
   
2
   
1,139
 
Consumer
  
241
   
87
   
78
   
24
   
274
 
All other
  
2,183
   
293
   
53
   
72
   
2,495
 
Total
 
$
10,170
  
$
(146
)
 
$
143
  
$
813
  
$
10,694
 

Activity in the allowance for loan losses by portfolio segment for the three months ending June 30, 2014 was as follows:

Loan Class
 
Balance
March 31, 2014
  
Provision (credit)
for loan losses
  
Loans charged-off
  
Recoveries
  
Balance
June 30, 2014
 
           
Residential real estate
 
$
2,250
  
$
36
  
$
152
  
$
6
  
$
2,140
 
Multifamily real estate
  
297
   
14
   
-
   
-
   
311
 
Commercial real estate:
                    
Owner occupied
  
1,477
   
(32
)
  
81
   
-
   
1,364
 
Non owner occupied
  
2,385
   
(92
)
  
23
   
-
   
2,270
 
Commercial and industrial
  
1,527
   
(20
)
  
21
   
3
   
1,489
 
Consumer
  
220
   
37
   
33
   
8
   
232
 
All other
  
2,188
   
(22
)
  
167
   
72
   
2,071
 
Total
 
$
10,344
  
$
(79
)
 
$
477
  
$
89
  
$
9,877
 
Purchased Loans
The carrying amount of those loans is as follows at June 30, 2015 and December 31, 2014.

  
2015
  
2014
 
Multifamily real estate
 
$
460
  
$
497
 
Commercial real estate
        
Owner occupied
  
131
   
131
 
Non owner occupied
  
5,623
   
5,695
 
Commercial and industrial
  
126
   
136
 
All other
  
5,149
   
5,128
 
Total carrying amount
 
$
11,489
  
$
11,587
 
Contractual principal balance
 
$
21,159
  
$
21,250
 
         
Carrying amount, net of allowance
 
$
10,463
  
$
10,639
 
Purchase Loans Accretable Yield, or Income Expected to be Collected
The accretable yield, or income expected to be collected, on the purchased loans above is as follows at June 30, 2015 and June 30, 2014.

  
2015
  
2014
 
Balance at January 1
 
$
204
  
$
217
 
New loans purchased
  
-
   
-
 
Accretion of income
  
(10
)
  
(6
)
Reclassifications from non-accretable difference
  
-
   
-
 
Disposals
  
-
   
-
 
Balance at June 30
 
$
194
  
$
211
 
Past Due and Non-performing Loans
The following tables present the recorded investment in nonaccrual and loans past due over 90 days still on accrual by class of loans as of June 30, 2015 and December 31, 2014.  The recorded investment in non-accrual loans is less than the principal owed on non-accrual loans due to discounts applied to the carrying value of the loan at time of their acquisition and interest payments made by the borrower which have been used to reduce the recorded investment in the loan rather than recognized as interest income.

June 30, 2015
 
Principal Owed on Non-accrual Loans
  
Recorded Investment in Non-accrual Loans
  
Loans Past Due Over 90 Days, still accruing
 
       
Residential  real estate
 
$
2,507
  
$
2,283
  
$
378
 
Multifamily real estate
  
1,532
   
539
   
-
 
Commercial real estate
            
Owner occupied
  
807
   
737
   
8
 
Non owner occupied
  
1,960
   
1,689
   
1,820
 
Commercial and industrial
  
1,576
   
471
   
83
 
Consumer
  
98
   
80
   
-
 
All other
  
12,635
   
5,183
   
-
 
Total
 
$
21,115
  
$
10,982
  
$
2,289
 
             

December 31, 2014
 
Principal Owed on Non-accrual Loans
  
Recorded Investment in Non-accrual Loans
  
Loans Past Due Over 90 Days, still accruing
 
       
Residential  real estate
 
$
1,996
  
$
1,768
  
$
668
 
Multifamily real estate
  
1,803
   
1,033
   
564
 
Commercial real estate
            
Owner occupied
  
2,115
   
1,928
   
-
 
Non owner occupied
  
2,020
   
1,819
   
26
 
Commercial and industrial
  
2,012
   
806
   
8
 
Consumer
  
213
   
185
   
-
 
All other
  
12,608
   
5,173
   
-
 
Total
 
$
22,767
  
$
12,712
  
$
1,266
 
Aging of Recorded Investment in Past Due Loans by Loan Class
The following table presents the aging of the recorded investment in past due loans as of June 30, 2015 by class of loans:
 
Loan Class
 
Total Loans
  
30-89 Days Past Due
  
Greater than 90 days past due
  
Total Past Due
  
Loans Not Past Due
 
           
Residential real estate
 
$
282,923
  
$
5,862
  
$
1,658
  
$
7,520
  
$
275,403
 
Multifamily real estate
  
37,112
   
460
   
79
   
539
   
36,573
 
Commercial real estate:
                    
Owner occupied
  
122,879
   
1,769
   
549
   
2,318
   
120,561
 
Non owner occupied
  
217,881
   
125
   
3,509
   
3,634
   
214,247
 
Commercial and industrial
  
76,193
   
1,737
   
348
   
2,085
   
74,108
 
Consumer
  
31,561
   
526
   
15
   
541
   
31,020
 
All other
  
115,324
   
13,591
   
5,149
   
18,740
   
96,584
 
Total
 
$
883,873
  
$
24,070
  
$
11,307
  
$
35,377
  
$
848,496
 

The following table presents the aging of the recorded investment in past due loans as of December 31, 2014 by class of loans:
 
Loan Class
 
Total Loans
  
30-89 Days Past Due
  
Greater than 90 days past due
  
Total Past Due
  
Loans Not Past Due
 
           
Residential real estate
 
$
278,212
  
$
5,810
  
$
1,706
  
$
7,516
  
$
270,696
 
Multifamily real estate
  
30,310
   
177
   
1,100
   
1,277
   
29,033
 
Commercial real estate:
                    
Owner occupied
  
120,861
   
250
   
1,530
   
1,780
   
119,081
 
Non owner occupied
  
230,750
   
2,173
   
1,670
   
3,843
   
226,907
 
Commercial and industrial
  
85,943
   
1,720
   
608
   
2,328
   
83,615
 
Consumer
  
32,745
   
497
   
71
   
568
   
32,177
 
All other
  
100,890
   
234
   
5,127
   
5,361
   
95,529
 
Total
 
$
879,711
  
$
10,861
  
$
11,812
  
$
22,673
  
$
857,038
 
Allowance for Loan Losses and Recorded Investment in Loans by Portfolio Segment Based on Impairment Method
The following table presents the balance in the allowance for loan losses and the recorded investment in loans by portfolio segment and based on impairment method as of June 30, 2015:
 
  
Allowance for Loan Losses
  
Loan Balances
 
Loan Class
 
Individually Evaluated for Impairment
  
Collectively Evaluated for Impairment
  
Acquired with Deteriorated Credit Quality
  
Total
  
Individually Evaluated for Impairment
  
Collectively Evaluated for Impairment
  
Acquired with Deteriorated Credit Quality
  
Total
 
                 
Residential real estate
 
$
183
  
$
2,283
  
$
-
  
$
2,466
  
$
571
  
$
282,352
  
$
-
  
$
282,923
 
Multifamily real estate
  
-
   
512
   
-
   
512
   
79
   
36,573
   
460
   
37,112
 
Commercial real estate:
                                
Owner occupied
  
48
   
1,428
   
-
   
1,476
   
943
   
121,805
   
131
   
122,879
 
Non-owner occupied
  
29
   
2,303
   
-
   
2,332
   
4,396
   
207,862
   
5,623
   
217,881
 
Commercial and industrial
  
230
   
783
   
126
   
1,139
   
666
   
75,401
   
126
   
76,193
 
Consumer
  
-
   
274
   
-
   
274
   
-
   
31,561
   
-
   
31,561
 
All other
  
-
   
1,595
   
900
   
2,495
   
912
   
109,263
   
5,149
   
115,324
 
Total
 
$
490
  
$
9,178
  
$
1,026
  
$
10,694
  
$
7,567
  
$
864,817
  
$
11,489
  
$
883,873
 

The following table presents the balance in the allowance for loan losses and the recorded investment in loans by portfolio segment and based on impairment method as of December 31, 2014:
 
  
Allowance for Loan Losses
  
Loan Balances
 
Loan Class
 
Individually Evaluated for Impairment
  
Collectively Evaluated for Impairment
  
Acquired with Deteriorated Credit Quality
  
Total
  
Individually Evaluated for Impairment
  
Collectively Evaluated for Impairment
  
Acquired with Deteriorated Credit Quality
  
Total
 
                 
Residential real estate
 
$
-
  
$
2,093
  
$
-
  
$
2,093
  
$
137
  
$
278,075
  
$
-
  
$
278,212
 
Multifamily real estate
  
-
   
304
   
-
   
304
   
536
   
29,277
   
497
   
30,310
 
Commercial real estate:
                                
Owner occupied
  
107
   
1,394
   
-
   
1,501
   
2,011
   
118,719
   
131
   
120,861
 
Non-owner occupied
  
54
   
2,262
   
-
   
2,316
   
4,874
   
220,181
   
5,695
   
230,750
 
Commercial and industrial
  
291
   
1,105
   
48
   
1,444
   
902
   
84,905
   
136
   
85,943
 
Consumer
  
-
   
243
   
-
   
243
   
-
   
32,745
   
-
   
32,745
 
All other
  
-
   
1,546
   
900
   
2,446
   
1,109
   
94,653
   
5,128
   
100,890
 
Total
 
$
452
  
$
8,947
  
$
948
  
$
10,347
  
$
9,569
  
$
858,555
  
$
11,587
  
$
879,711
 
Loans Individually Evaluated for Impairment by Class of Loans
The following table presents loans individually evaluated for impairment by class of loans as of    June 30, 2015.  The table includes $5,658,000 of loans acquired with deteriorated credit quality that the Company cannot reasonably estimate cash flows such that they are accounted for on the cost recovery method and are still individually evaluated for impairment.

  
Unpaid Principal Balance
  
Recorded Investment
  
Allowance for Loan Losses Allocated
 
With no related allowance recorded:
      
Residential real estate
 
$
363
  
$
325
  
$
-
 
Multifamily real estate
  
1,532
   
539
   
-
 
Commercial real estate
            
Owner occupied
  
612
   
549
   
-
 
Non owner occupied
  
4,049
   
3,778
   
-
 
Commercial and industrial
  
1,193
   
417
   
-
 
All other
  
967
   
912
   
-
 
   
8,716
   
6,520
   
-
 
With an allowance recorded:
            
Residential real estate
 
$
252
  
$
246
  
$
183
 
Commercial real estate
            
Owner occupied
  
394
   
394
   
48
 
Non owner occupied
  
618
   
618
   
29
 
Commercial and industrial
  
651
   
375
   
356
 
All other
  
12,546
   
5,149
   
900
 
   
14,461
   
6,782
   
1,516
 
Total
 
$
23,177
  
$
13,302
  
$
1,516
 
 
The following table presents loans individually evaluated for impairment by class of loans as of December 31, 2014.  The table includes $5,673,000 of loans acquired with deteriorated credit quality that the Company cannot reasonably estimate cash flows such that they are accounted for on the cost recovery method and are still individually evaluated for impairment.

  
Unpaid Principal Balance
  
Recorded Investment
  
Allowance for Loan Losses Allocated
 
With no related allowance recorded:
      
Residential  real estate
 
$
179
  
$
137
  
$
-
 
Multifamily real estate
  
1,803
   
1,033
   
-
 
Commercial real estate
            
Owner occupied
  
1,404
   
1,304
   
-
 
Non owner occupied
  
4,398
   
4,190
   
-
 
Commercial and industrial
  
1,030
   
270
   
-
 
All other
  
1,144
   
1,108
   
-
 
   
9,958
   
8,042
   
-
 
With an allowance recorded:
            
Commercial real estate
            
Owner occupied
 
$
707
  
$
707
  
$
107
 
Non owner occupied
  
684
   
684
   
54
 
Commercial and industrial
  
929
   
680
   
339
 
All other
  
12,525
   
5,129
   
900
 
   
14,845
   
7,200
   
1,400
 
Total
 
$
24,803
  
$
15,242
  
$
1,400
 
             
The Average Balance of Loans Individually Evaluated for Impairment and Interest Income Recognized
The following table presents the average balance of loans individually evaluated for impairment and interest income recognized on these loans for the six months ended June 30, 2015 and June 30, 2014.   The table includes loans acquired with deteriorated credit quality that are still individually evaluated for impairment.

  
Six months ended June 30, 2015
  
Six months ended June 30, 2014
 
Loan Class
 
Average Recorded Investment
  
Interest Income Recognized
  
Cash Basis Interest Recognized
  
Average Recorded Investment
  
Interest Income Recognized
  
Cash Basis Interest Recognized
 
 
Residential real estate
 
$
281
  
$
2
  
$
2
  
$
2,536
  
$
61
  
$
61
 
Multifamily real estate
  
1,377
   
14
   
14
   
2,586
   
727
   
727
 
Commercial real estate:
                        
Owner occupied
  
1,286
   
18
   
13
   
2,155
   
29
   
21
 
Non-owner occupied
  
4,665
   
94
   
82
   
800
   
627
   
627
 
Commercial and industrial
  
922
   
14
   
14
   
2,395
   
542
   
542
 
All other
  
6,150
   
30
   
28
   
7,603
   
81
   
81
 
Total
 
$
14,681
  
$
172
  
$
153
  
$
18,075
  
$
2,067
  
$
2,059
 

The following table presents the average balance of loans individually evaluated for impairment and interest income recognized on these loans for the three months ended June 30, 2015 and June 30, 2014.  The table includes loans acquired with deteriorated credit quality that are still individually evaluated for impairment.

  
Three months ended June 30, 2015
  
Three months ended June 30, 2014
 
Loan Class
 
Average Recorded Investment
  
Interest Income Recognized
  
Cash Basis Interest Recognized
  
Average Recorded Investment
  
Interest Income Recognized
  
Cash Basis Interest Recognized
 
             
Residential real estate
 
$
352
  
$
1
  
$
1
  
$
2,318
  
$
27
  
$
27
 
Multifamily real estate
  
1,550
   
14
   
14
   
2,353
   
19
   
19
 
Commercial real estate:
                        
Owner occupied
  
922
   
9
   
5
   
1,983
   
14
   
10
 
Non-owner occupied
  
4,561
   
46
   
34
   
214
   
-
   
-
 
Commercial and industrial
  
908
   
10
   
10
   
1,265
   
9
   
9
 
All other
  
6,108
   
14
   
14
   
7,453
   
38
   
38
 
Total
 
$
14,401
  
$
94
  
$
78
  
$
15,586
  
$
107
  
$
103
 
Troubled Debt Restructurings
The following table presents TDR's as of June 30, 2015 and December 31, 2014:

June 30, 2015
 
TDR's on Non-accrual
  
Other TDR's
  
Total TDR's
 
       
Residential  real estate
 
$
9
  
$
181
  
$
190
 
Commercial real estate
            
Non owner occupied
  
-
   
464
   
464
 
Commercial and industrial
  
-
   
417
   
417
 
All other
  
-
   
886
   
886
 
Total
 
$
9
  
$
1,948
  
$
1,957
 
             

December 31, 2014
 
TDR's on Non-accrual
  
Other TDR's
  
Total TDR's
 
       
Residential  real estate
 
$
13
  
$
191
  
$
204
 
Commercial real estate
            
Non owner occupied
  
-
   
474
   
474
 
Commercial and industrial
  
-
   
761
   
761
 
All other
  
-
   
1,063
   
1,063
 
Total
 
$
13
  
$
2,489
  
$
2,502
 
             
Troubled Debt Restructuring During the Period
The following table presents TDR's that occurred during the six months ended June 30, 2015.  There were no TDR's that occurred during the six months ended June 30, 2014.

  
Six months ended June 30, 2015
 
Loan Class
 
Number of Loans
  
Pre-Modification Outstanding Recorded Investment
  
Post-Modification Outstanding Recorded Investment
 
       
Multifamily Real Estate
  
1
  
$
1,543
  
$
1,543
 
Total
  
1
  
$
1,543
  
$
1,543
 
Risk Category of Loans by Class of Loans
As of June 30, 2015 and based on the most recent analysis performed, the risk category of loans by class of loans is as follows:

Loan Class
 
Pass
  
Special Mention
  
Substandard
  
Doubtful
  
Total Loans
 
           
Residential real estate
 
$
270,610
  
$
5,125
  
$
7,179
  
$
9
  
$
282,923
 
Multifamily real estate
  
32,287
   
4,286
   
539
   
-
   
37,112
 
Commercial real estate:
                    
Owner occupied
  
115,111
   
5,326
   
2,442
   
-
   
122,879
 
Non-owner occupied
  
209,695
   
888
   
7,298
   
-
   
217,881
 
Commercial and industrial
  
74,396
   
714
   
1,034
   
49
   
76,193
 
Consumer
  
31,175
   
245
   
141
   
-
   
31,561
 
All other
  
94,355
   
14,310
   
6,659
   
-
   
115,324
 
Total
 
$
827,629
  
$
30,894
  
$
25,292
  
$
58
  
$
883,873
 

As of December 31, 2014, and based on the most recent analysis performed, the risk category of loans by class of loans is as follows:

Loan Class
 
Pass
  
Special Mention
  
Substandard
  
Doubtful
  
Total Loans
 
           
Residential real estate
 
$
265,285
  
$
8,292
  
$
4,622
  
$
13
  
$
278,212
 
Multifamily real estate
  
27,260
   
2,017
   
1,033
   
-
   
30,310
 
Commercial real estate:
                    
Owner occupied
  
111,024
   
6,505
   
3,332
   
-
   
120,861
 
Non-owner occupied
  
218,971
   
6,652
   
5,127
   
-
   
230,750
 
Commercial and industrial
  
83,634
   
1,007
   
1,275
   
27
   
85,943
 
Consumer
  
32,364
   
267
   
114
   
-
   
32,745
 
All other
  
89,173
   
4,873
   
6,844
   
-
   
100,890
 
Total
 
$
827,711
  
$
29,613
  
$
22,347
  
$
40
  
$
879,711