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LOANS (Tables)
 3 Months Ended
Mar. 31, 2020
LOANS [Abstract]  
Major Classifications of Loans
Major classifications of loans at March 31, 2020 and December 31, 2019 are summarized as follows:

  
2020
  
2019
 
Residential real estate
 
$
387,909
  
$
389,985
 
Multifamily real estate
  
40,286
   
36,684
 
Commercial real estate:
        
Owner occupied
  
168,102
   
164,218
 
Non-owner occupied
  
306,854
   
304,316
 
Commercial and industrial
  
101,132
   
105,079
 
Consumer
  
26,409
   
29,007
 
Construction and land
  
119,415
   
136,138
 
All other
  
34,936
   
29,868
 
  
$
1,185,043
  
$
1,195,295
 
Activity in the Allowance for Loan Losses by Portfolio Segment
Activity in the allowance for loan losses by portfolio segment for the three months ended March 31, 2020 was as follows:

Loan Class
 
Balance
Dec 31,
2019
  
Provision
(credit) for
loan losses
  
Loans
charged-
off
  
Recoveries
  
Balance
March 31,
2020
 
                
Residential real estate
 
$
1,711
  
$
216
  
$
(93
)
 
$
4
  
$
1,838
 
Multifamily real estate
  
1,954
   
150
   
-
   
-
   
2,104
 
Commercial real estate:
                    
Owner occupied
  
2,441
   
342
   
(566
)
  
3
   
2,220
 
Non-owner occupied
  
3,184
   
479
   
(24
)
  
3
   
3,642
 
Commercial and industrial
  
1,767
   
22
   
-
   
28
   
1,817
 
Consumer
  
281
   
2
   
(69
)
  
27
   
241
 
Construction and land
  
1,724
   
(349
)
  
-
   
37
   
1,412
 
All other
  
480
   
138
   
(74
)
  
38
   
582
 
Total
 
$
13,542
  
$
1,000
  
$
(826
)
 
$
140
  
$
13,856
 

Activity in the allowance for loan losses by portfolio segment for the three months ended March 31, 2019 was as follows:

Loan Class
 
Balance
Dec 31,
2018
  
Provision
(credit) for
loan losses
  
Loans
charged-
off
  
Recoveries
  
Balance
March 31,
2019
 
                
Residential real estate
 
$
1,808
  
$
42
  
$
(32
)
 
$
5
  
$
1,823
 
Multifamily real estate
  
1,649
   
(61
)
  
-
   
2
   
1,590
 
Commercial real estate:
                    
Owner occupied
  
2,120
   
236
   
(533
)
  
1
   
1,824
 
Non-owner occupied
  
3,058
   
400
   
(57
)
  
-
   
3,401
 
Commercial and industrial
  
1,897
   
(97
)
  
(110
)
  
31
   
1,721
 
Consumer
  
351
   
110
   
(107
)
  
11
   
365
 
Construction and land
  
2,255
   
(93
)
  
(13
)
  
-
   
2,149
 
All other
  
600
   
23
   
(51
)
  
34
   
606
 
Total
 
$
13,738
  
$
560
  
$
(903
)
 
$
84
  
$
13,479
 
Purchased Impaired Loans
The carrying amount of those loans is as follows at March 31, 2020 and December 31, 2019.

  
2020
  
2019
 
Residential real estate
 
$
2,436
  
$
2,565
 
Commercial real estate
        
Owner occupied
  
1,750
   
1,804
 
Non-owner occupied
  
2,533
   
2,628
 
Commercial and industrial
  
291
   
305
 
Consumer
  
19
   
22
 
Construction and land
  
476
   
483
 
All other
  
171
   
174
 
Total carrying amount
 
$
7,676
  
$
7,981
 
Contractual principal balance
 
$
11,424
  
$
11,681
 
 
        
Carrying amount, net of allowance
 
$
7,676
  
$
7,981
 
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 March 31, 2020 and March 31, 2019.

  
2020
  
2019
 
Balance at January 1
 
$
619
  
$
642
 
New loans purchased
  
-
   
-
 
Accretion of income
  
(36
)
  
(53
)
Loans placed on non-accrual
  
-
   
(14
)
Income recognized upon full repayment
  
(7
)
  
(42
)
Reclassifications from non-accretable difference
  
-
   
-
 
Disposals
  
-
   
-
 
Balance at March 31
 
$
576
  
$
533
 
Past Due and Non-performing Loans
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.

March 31, 2020
 
Principal
Owed on
Non-accrual
Loans
  
Recorded
Investment in
Non-accrual
Loans
  
Loans Past
Due Over 90
Days, still
accruing
 
          
Residential real estate
 
$
5,478
  
$
4,266
  
$
710
 
Multifamily real estate
  
4,184
   
3,797
   
-
 
Commercial real estate
            
Owner occupied
  
3,125
   
2,396
   
10
 
Non-owner occupied
  
4,214
   
2,872
   
66
 
Commercial and industrial
  
1,047
   
498
   
300
 
Consumer
  
367
   
283
   
16
 
Construction and land
  
374
   
337
   
-
 
All other
  
75
   
60
   
-
 
Total
 
$
18,864
  
$
14,509
  
$
1,102
 

December 31, 2019
 
Principal
Owed on
Non-accrual
Loans
  
Recorded
Investment in
Non-accrual
Loans
  
Loans Past
Due Over 90
Days, still
accruing
 
          
Residential real estate
 
$
5,801
  
$
4,618
  
$
1,425
 
Multifamily real estate
  
4,113
   
3,726
   
-
 
Commercial real estate
            
Owner occupied
  
3,399
   
2,995
   
-
 
Non-owner occupied
  
3,120
   
1,852
   
340
 
Commercial and industrial
  
1,026
   
420
   
451
 
Consumer
  
364
   
313
   
9
 
Construction and land
  
470
   
440
   
3
 
All other
  
75
   
73
   
-
 
Total
 
$
18,368
  
$
14,437
  
$
2,228
 
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 March 31, 2020 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
 
$
387,909
  
$
5,829
  
$
2,505
  
$
8,334
  
$
379,575
 
Multifamily real estate
  
40,286
   
-
   
3,797
   
3,797
   
36,489
 
Commercial real estate:
                    
Owner occupied
  
168,102
   
786
   
964
   
1,750
   
166,352
 
Non-owner occupied
  
306,854
   
3,058
   
849
   
3,907
   
302,947
 
Commercial and industrial
  
101,132
   
1,370
   
655
   
2,025
   
99,107
 
Consumer
  
26,409
   
128
   
152
   
280
   
26,129
 
Construction and land
  
119,415
   
150
   
5
   
155
   
119,260
 
All other
  
34,936
   
-
   
60
   
60
   
34,876
 
Total
 
$
1,185,043
  
$
11,321
  
$
8,987
  
$
20,308
  
$
1,164,735
 

The following table presents the aging of the recorded investment in past due loans as of December 31, 2019 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
 
$
389,985
  
$
9,479
  
$
3,192
  
$
12,671
  
$
377,314
 
Multifamily real estate
  
36,684
   
-
   
3,726
   
3,726
   
32,958
 
Commercial real estate:
                    
Owner occupied
  
164,218
   
337
   
1,199
   
1,536
   
162,682
 
Non-owner occupied
  
304,316
   
838
   
1,017
   
1,855
   
302,461
 
Commercial and industrial
  
105,079
   
245
   
708
   
953
   
104,126
 
Consumer
  
29,007
   
309
   
230
   
539
   
28,468
 
Construction and land
  
136,138
   
3,856
   
4
   
3,860
   
132,278
 
All other
  
29,868
   
-
   
73
   
73
   
29,795
 
Total
 
$
1,195,295
  
$
15,064
  
$
10,149
  
$
25,213
  
$
1,170,082
 
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 March 31, 2020:

  
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
 
$
-
  
$
1,838
  
$
-
  
$
1,838
  
$
62
  
$
385,411
  
$
2,436
  
$
387,909
 
Multifamily real estate
  
1,855
   
249
   
-
   
2,104
   
3,797
   
36,489
   
-
   
40,286
 
Commercial real estate:
                                
Owner occupied
  
-
   
2,220
   
-
   
2,220
   
1,492
   
164,860
   
1,750
   
168,102
 
Non-owner occupied
  
407
   
3,235
   
-
   
3,642
   
4,064
   
300,257
   
2,533
   
306,854
 
Commercial and industrial
  
456
   
1,361
   
-
   
1,817
   
773
   
100,068
   
291
   
101,132
 
Consumer
  
-
   
241
   
-
   
241
   
-
   
26,390
   
19
   
26,409
 
Construction and land
  
-
   
1,412
       
1,412
   
325
   
118,614
   
476
   
119,415
 
All other
  
-
   
582
   
-
   
582
   
-
   
34,765
   
171
   
34,936
 
Total
 
$
2,718
  
$
11,138
  
$
-
  
$
13,856
  
$
10,513
  
$
1,166,854
  
$
7,676
  
$
1,185,043
 

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, 2019:

  
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
 
$
-
  
$
1,711
  
$
-
  
$
1,711
  
$
63
  
$
387,357
  
$
2,565
  
$
389,985
 
Multifamily real estate
  
1,737
   
217
   
-
   
1,954
   
3,726
   
32,958
   
-
   
36,684
 
Commercial real estate:
                                
Owner occupied
  
653
   
1,788
   
-
   
2,441
   
2,685
   
159,729
   
1,804
   
164,218
 
Non-owner occupied
  
271
   
2,913
   
-
   
3,184
   
3,830
   
297,858
   
2,628
   
304,316
 
Commercial and industrial
  
390
   
1,377
   
-
   
1,767
   
678
   
104,096
   
305
   
105,079
 
Consumer
  
-
   
281
   
-
   
281
   
-
   
28,985
   
22
   
29,007
 
Construction and land
  
51
   
1,673
   
-
   
1,724
   
431
   
135,224
   
483
   
136,138
 
All other
  
-
   
480
   
-
   
480
   
-
   
29,694
   
174
   
29,868
 
Total
 
$
3,102
  
$
10,440
  
$
-
  
$
13,542
  
$
11,413
  
$
1,175,901
  
$
7,981
  
$
1,195,295
 
Loans Individually Evaluated for Impairment by Class of Loans
The following table presents loans individually evaluated for impairment by class of loans as of March 31, 2020.  The table includes $710,000 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
 
$
184
  
$
62
  
$
-
 
Multifamily real estate
  
97
   
89
   
-
 
Commercial real estate
            
Owner occupied
  
2,189
   
1,811
   
-
 
Non-owner occupied
  
1,668
   
830
   
-
 
Commercial and industrial
  
509
   
-
   
-
 
Construction and land
  
361
   
326
   
-
 
   
5,008
   
3,118
   
-
 
With an allowance recorded:
            
Multifamily real estate
  
4,088
   
3,708
   
1,855
 
Commercial real estate
            
Non-owner occupied
  
3,760
   
3,624
   
407
 
Commercial and industrial
  
786
   
773
   
456
 
   
8,634
   
8,105
   
2,718
 
Total
 
$
13,642
  
$
11,223
  
$
2,718
 

The following table presents loans individually evaluated for impairment by class of loans as of December 31, 2019.  The table includes $758,000 of loans acquired with deteriorated credit quality for which 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
 
$
188
  
$
63
  
$
-
 
Multifamily real estate
  
96
   
89
   
-
 
Commercial real estate
            
Owner occupied
  
2,201
   
1,842
   
-
 
Non-owner occupied
  
2,512
   
1,732
   
-
 
Commercial and industrial
  
509
   
-
   
-
 
   
5,506
   
3,726
   
-
 
With an allowance recorded:
            
Multifamily real estate
 
$
4,017
  
$
3,637
  
$
1,737
 
Commercial real estate
            
Owner occupied
  
1,189
   
1,162
   
653
 
Non-owner occupied
  
2,654
   
2,537
   
271
 
Commercial and industrial
  
689
   
678
   
390
 
Construction and land
  
460
   
431
   
51
 
   
9,009
   
8,445
   
3,102
 
Total
 
$
14,515
  
$
12,171
  
$
3,102
 
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 three months ended March 31, 2020 and March 31, 2019.  The table includes loans acquired with deteriorated credit quality that are still individually evaluated for impairment.

  
Three months ended March 31, 2020
  
Three months ended March 31, 2019
 
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
 
$
62
  
$
-
  
$
-
  
$
264
  
$
-
  
$
-
 
Multifamily real estate
  
3,761
   
-
   
-
   
3,877
   
-
   
-
 
Commercial real estate:
                        
Owner occupied
  
2,408
   
3
   
3
   
3,874
   
3
   
3
 
Non-owner occupied
  
4,362
   
36
   
36
   
10,580
   
94
   
91
 
Commercial and industrial
  
726
   
1
   
1
   
500
   
1
   
1
 
Construction and land
  
378
   
-
   
-
   
1,341
   
8
   
8
 
Total
 
$
11,697
  
$
40
  
$
40
  
$
20,436
  
$
106
  
$
103
 
Troubled Debt Restructurings
The following table presents TDR’s as of March 31, 2020 and December 31, 2019:

March 31, 2020
 
TDR’s on
Non-accrual
  
Other
TDR’s
  
Total TDR’s
 
          
Residential real estate
 
$
28
  
$
153
  
$
181
 
Multifamily real estate
  
3,708
   
-
   
3,708
 
Commercial real estate
            
Owner occupied
  
-
   
202
   
202
 
Non-owner occupied
  
-
   
2,637
   
2,637
 
Commercial and industrial
  
191
   
-
   
191
 
Total
 
$
3,927
  
$
2,992
  
$
6,919
 

December 31, 2019
 
TDR’s on
Non-accrual
  
Other
TDR’s
  
Total TDR’s
 
          
Residential real estate
 
$
32
  
$
157
  
$
189
 
Multifamily real estate
  
3,636
   
-
   
3,636
 
Commercial real estate
            
Owner occupied
  
1,162
   
207
   
1,369
 
Non-owner occupied
  
-
   
2,656
   
2,656
 
Commercial and industrial
  
191
   
-
   
191
 
Total
 
$
5,021
  
$
3,020
  
$
8,041
 
Risk Category of Loans by Class of Loans
As of March 31, 2020, 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
 
$
373,530
  
$
3,210
  
$
11,169
  
$
-
  
$
387,909
 
Multifamily real estate
  
32,269
   
4,220
   
3,797
   
-
   
40,286
 
Commercial real estate:
                    
Owner occupied
  
158,862
   
4,766
   
4,474
   
-
   
168,102
 
Non-owner occupied
  
290,508
   
10,782
   
5,564
   
-
   
306,854
 
Commercial and industrial
  
96,476
   
3,250
   
1,406
   
-
   
101,132
 
Consumer
  
26,063
   
4
   
342
   
-
   
26,409
 
Construction and land
  
111,084
   
7,667
   
664
   
-
   
119,415
 
All other
  
34,876
   
-
   
60
   
-
   
34,936
 
Total
 
$
1,123,668
  
$
33,899
  
$
27,476
  
$
-
  
$
1,185,043
 

As of December 31, 2019, 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
 
$
374,835
  
$
3,477
  
$
11,673
  
$
-
  
$
389,985
 
Multifamily real estate
  
28,103
   
4,855
   
3,726
   
-
   
36,684
 
Commercial real estate:
                    
Owner occupied
  
152,695
   
5,123
   
6,400
   
-
   
164,218
 
Non-owner occupied
  
290,096
   
8,617
   
5,603
   
-
   
304,316
 
Commercial and industrial
  
101,085
   
2,693
   
1,301
   
-
   
105,079
 
Consumer
  
28,618
   
5
   
384
   
-
   
29,007
 
Construction and land
  
123,473
   
11,868
   
797
       
136,138
 
All other
  
29,698
   
97
   
73
   
-
   
29,868
 
Total
 
$
1,128,603
  
$
36,735
  
$
29,957
  
$
-
  
$
1,195,295