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

  
2015
  
2014
 
Residential real estate
 
$
284,052
  
$
278,212
 
Multifamily real estate
  
37,202
   
30,310
 
Commercial real estate:
        
Owner occupied
  
117,125
   
120,861
 
Non owner occupied
  
208,101
   
230,750
 
Commercial and industrial
  
76,314
   
85,943
 
Consumer
  
31,894
   
32,745
 
All other
  
100,374
   
100,890
 
  
$
855,062
  
$
879,711
 
Activity in the Allowance for Loan Losses by Portfolio Segment
Activity in the allowance for loan losses by portfolio segment for the nine months ended September 30, 2015 was as follows:

Loan Class
 
Balance
Dec 31, 2014
  
Provision (Credit)
for loan losses
  
Loans charged-off
  
Recoveries
  
Balance
Sept 30, 2015
 
           
Residential real estate
 
$
2,093
  
$
557
  
$
102
  
$
74
  
$
2,622
 
Multifamily real estate
  
304
   
291
   
-
   
-
   
595
 
Commercial real estate:
                    
Owner occupied
  
1,501
   
(3
)
  
2
   
2
   
1,498
 
Non owner occupied
  
2,316
   
(599
)
  
-
   
659
   
2,376
 
Commercial and industrial
  
1,444
   
71
   
403
   
7
   
1,119
 
Consumer
  
243
   
128
   
167
   
82
   
286
 
All other
  
2,446
   
(213
)
  
1,058
   
154
   
1,329
 
Total
 
$
10,347
  
$
232
  
$
1,732
  
$
978
  
$
9,825
 

Activity in the allowance for loan losses by portfolio segment for the nine months ended September 30, 2014 was as follows:

Loan Class
 
Balance
Dec 31, 2013
  
Provision (Credit)
for loan losses
  
Loans charged-off
  
Recoveries
  
Balance
Sept 30, 2014
 
           
Residential real estate
 
$
2,694
  
$
(419
)
 
$
308
  
$
55
  
$
2,022
 
Multifamily real estate
  
417
   
(137
)
  
-
   
-
   
280
 
Commercial real estate:
                    
Owner occupied
  
1,407
   
112
   
207
   
-
   
1,312
 
Non owner occupied
  
2,037
   
310
   
323
   
-
   
2,024
 
Commercial and industrial
  
2,184
   
(335
)
  
111
   
11
   
1,749
 
Consumer
  
297
   
(12
)
  
105
   
45
   
225
 
All other
  
1,991
   
628
   
267
   
216
   
2,568
 
Total
 
$
11,027
  
$
147
  
$
1,321
  
$
327
  
$
10,180
 

Activity in the allowance for loan losses by portfolio segment for the three months ended September 30, 2015 was as follows:

Loan Class
 
Balance
June 30, 2015
  
Provision (Credit)
for loan losses
  
Loans charged-off
  
Recoveries
  
Balance
Sept. 30, 2015
 
           
Residential real estate
 
$
2,466
  
$
185
  
$
35
  
$
6
  
$
2,622
 
Multifamily real estate
  
512
   
83
   
-
   
-
   
595
 
Commercial real estate:
                    
Owner occupied
  
1,476
   
21
   
-
   
1
   
1,498
 
Non owner occupied
  
2,332
   
44
   
-
   
-
   
2,376
 
Commercial and industrial
  
1,139
   
211
   
234
   
3
   
1,119
 
Consumer
  
274
   
23
   
35
   
24
   
286
 
All other
  
2,495
   
(258
)
  
946
   
38
   
1,329
 
Total
 
$
10,694
  
$
309
  
$
1,250
  
$
72
  
$
9,825
 

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

Loan Class
 
Balance
June 30, 2014
  
Provision (Credit)
for loan losses
  
Loans charged-off
  
Recoveries
  
Balance
Sept 30, 2014
 
           
Residential real estate
 
$
2,140
  
$
(28
)
 
$
137
  
$
47
  
$
2,022
 
Multifamily real estate
  
311
   
(31
)
  
-
   
-
   
280
 
Commercial real estate:
                    
Owner occupied
  
1,364
   
73
   
125
   
-
   
1,312
 
Non owner occupied
  
2,270
   
(246
)
  
-
   
-
   
2,024
 
Commercial and industrial
  
1,489
   
281
   
27
   
6
   
1,749
 
Consumer
  
232
   
21
   
46
   
18
   
225
 
All other
  
2,071
   
466
   
63
   
94
   
2,568
 
Total
 
$
9,877
  
$
536
  
$
398
  
$
165
  
$
10,180
 
Purchased Loans
The carrying amount of those loans is as follows at September 30, 2015 and December 31, 2014.

  
2015
  
2014
 
Multifamily real estate
 
$
-
  
$
497
 
Commercial real estate
        
Owner occupied
  
131
   
131
 
Non owner occupied
  
5,587
   
5,695
 
Commercial and industrial
  
114
   
136
 
All other
  
-
   
5,128
 
Total carrying amount
 
$
5,832
  
$
11,587
 
Contractual principal balance
 
$
7,450
  
$
21,250
 
         
Carrying amount, net of allowance
 
$
5,718
  
$
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 September 30, 2015 and September 30, 2014.

  
2015
  
2014
 
Balance at January 1
 
$
204
  
$
217
 
New loans purchased
  
-
   
-
 
Accretion of income
  
(14
)
  
(9
)
Reclassifications from non-accretable difference
  
-
   
-
 
Disposals
  
-
   
-
 
Balance at September 30
 
$
190
  
$
208
 
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 September 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.

September 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
 
$
2,439
  
$
2,188
  
$
971
 
Multifamily real estate
  
411
   
70
   
-
 
Commercial real estate
            
Owner occupied
  
879
   
806
   
1,132
 
Non owner occupied
  
1,928
   
1,628
   
1,811
 
Commercial and industrial
  
1,465
   
354
   
1,388
 
Consumer
  
211
   
198
   
-
 
All other
  
88
   
33
   
-
 
Total
 
$
7,431
  
$
5,277
  
$
5,302
 

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 September 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
 
$
284,052
  
$
5,320
  
$
2,086
  
$
7,406
  
$
276,646
 
Multifamily real estate
  
37,202
   
312
   
70
   
382
   
36,820
 
Commercial real estate:
                    
Owner occupied
  
117,125
   
2,137
   
1,674
   
3,811
   
113,314
 
Non owner occupied
  
208,101
   
4,115
   
3,439
   
7,554
   
200,547
 
Commercial and industrial
  
76,314
   
303
   
1,571
   
1,874
   
74,440
 
Consumer
  
31,894
   
442
   
91
   
533
   
31,361
 
All other
  
100,374
   
904
   
-
   
904
   
99,470
 
Total
 
$
855,062
  
$
13,533
  
$
8,931
  
$
22,464
  
$
832,598
 

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 September 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
 
$
177
  
$
2,445
  
$
-
  
$
2,622
  
$
475
  
$
283,577
  
$
-
  
$
284,052
 
Multifamily real estate
  
-
   
595
   
-
   
595
   
71
   
37,131
   
-
   
37,202
 
Commercial real estate:
                                
Owner occupied
  
33
   
1,465
   
-
   
1,498
   
772
   
116,222
   
131
   
117,125
 
Non-owner occupied
  
-
   
2,376
   
-
   
2,376
   
4,212
   
198,302
   
5,587
   
208,101
 
Commercial and industrial
  
139
   
866
   
114
   
1,119
   
546
   
75,654
   
114
   
76,314
 
Consumer
  
-
   
286
   
-
   
286
   
-
   
31,894
   
-
   
31,894
 
All other
  
-
   
1,329
   
-
   
1,329
   
912
   
99,462
   
-
   
100,374
 
Total
 
$
349
  
$
9,362
  
$
114
  
$
9,825
  
$
6,988
  
$
842,242
  
$
5,832
  
$
855,062
 

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 September 30, 2015.  The table includes $114,000 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
 
$
295
  
$
254
  
$
-
 
Multifamily real estate
  
412
   
71
   
-
 
Commercial real estate
            
Owner occupied
  
457
   
392
   
-
 
Non owner occupied
  
4,512
   
4,212
   
-
 
Commercial and industrial
  
1,180
   
407
   
-
 
All other
  
967
   
912
   
-
 
   
7,823
   
6,248
   
-
 
With an allowance recorded:
            
Residential real estate
 
$
227
  
$
221
  
$
177
 
Commercial real estate
            
Owner occupied
  
380
   
380
   
33
 
Commercial and industrial
  
536
   
253
   
253
 
   
1,143
   
854
   
463
 
Total
 
$
8,966
  
$
7,102
  
$
463
 
 
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 nine months ended September 30, 2015 and September 30, 2014. The table includes loans acquired with deteriorated credit quality that are still individually evaluated for impairment.

  
Nine months ended Sept. 30, 2015
  
Nine months ended Sept. 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
 
$
329
  
$
5
  
$
5
  
$
2,421
  
$
209
  
$
209
 
Multifamily real estate
  
1,051
   
685
   
685
   
2,518
   
746
   
746
 
Commercial real estate:
                        
Owner occupied
  
1,157
   
25
   
25
   
2,171
   
39
   
30
 
Non-owner occupied
  
4,552
   
137
   
115
   
1,388
   
644
   
634
 
Commercial and industrial
  
856
   
20
   
20
   
2,152
   
546
   
546
 
All other
  
4,841
   
43
   
28
   
7,624
   
126
   
126
 
Total
 
$
12,786
  
$
915
  
$
878
  
$
18,274
  
$
2,310
  
$
2,291
 

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 September 30, 2015 and September 30, 2014. The table includes loans acquired with deteriorated credit quality that are still individually evaluated for impairment.

  
Three months ended Sept. 30, 2015
  
Three months ended Sept. 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
 
$
523
  
$
3
  
$
3
  
$
2,166
  
$
148
  
$
148
 
Multifamily real estate
  
305
   
671
   
671
   
2,328
   
19
   
19
 
Commercial real estate:
                        
Owner occupied
  
857
   
7
   
7
   
2,080
   
10
   
9
 
Non-owner occupied
  
4,304
   
43
   
34
   
1,679
   
17
   
7
 
Commercial and industrial
  
726
   
6
   
6
   
1,337
   
4
   
4
 
All other
  
3,487
   
14
   
-
   
7,475
   
45
   
45
 
Total
 
$
10,202
  
$
744
  
$
721
  
$
17,065
  
$
243
  
$
232
 
Troubled Debt Restructurings
The following table presents TDR's as of September 30, 2015 and December 31, 2014:

September 30, 2015
 
TDR's on Non-accrual
  
Other TDR's
  
Total TDR's
 
       
Residential real estate
 
$
8
  
$
176
  
$
184
 
Commercial real estate
            
Non owner occupied
  
-
   
459
   
459
 
Commercial and industrial
  
-
   
406
   
406
 
All other
  
-
   
886
   
886
 
Total
 
$
8
  
$
1,927
  
$
1,935
 
             

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 nine months ended September 30, 2015.  There were no TDR's that occurred during the nine months ended September 30, 2014.

  
Nine months ended Sept. 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 September 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
 
$
271,872
  
$
5,268
  
$
6,904
  
$
8
  
$
284,052
 
Multifamily real estate
  
32,858
   
2,055
   
2,289
   
-
   
37,202
 
Commercial real estate:
                    
Owner occupied
  
110,387
   
3,814
   
2,924
   
-
   
117,125
 
Non-owner occupied
  
198,092
   
2,917
   
7,092
   
-
   
208,101
 
Commercial and industrial
  
73,507
   
1,839
   
921
   
47
   
76,314
 
Consumer
  
31,503
   
223
   
168
   
-
   
31,894
 
All other
  
97,686
   
1,348
   
1,340
   
-
   
100,374
 
Total
 
$
815,905
  
$
17,464
  
$
21,638
  
$
55
  
$
855,062
 

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