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LOANS RECEIVABLE
 6 Months Ended
Jun. 30, 2014
LOANS RECEIVABLE  
LOANS RECEIVABLE

6. LOANS RECEIVABLE

        Loans receivable consist of the following:

 
   June 30, 2014  
 
   (in thousands)
  

Commercial mortgage loans

   $ 120,153  

SBA 7(a) loans, subject to secured borrowings

     40,039  

SBA 7(a) loans

     32,998  
       
​ ​ ​ ​ ​

Loans receivable

     193,190  

Deferred capitalized costs

     129  
       
​ ​ ​ ​ ​

Net loans receivable

   $ 193,319  
       
​ ​ ​ ​ ​
​ ​ ​ ​ ​
       

        Commercial mortgage loans—Represents loans to small businesses primarily collateralized by first liens on the real estate of the related business.

        SBA 7(a) loans, subject to secured borrowings—Represents the government guaranteed portion of loans which were sold with the proceeds received from the sale reflected as secured borrowings—government guaranteed loans (included in debt on our consolidated balance sheet). There is no credit risk associated with these loans since the SBA has guaranteed payment of the principal.

        SBA 7(a) loans—Represents the non-government guaranteed retained portion of loans originated under the SBA 7(a) Program and the government guaranteed portion of loans that have not yet been fully funded or sold.

        Aging—The following tables represent an aging of our "Loans Receivable Subject to Credit Risk" (loans receivable less SBA 7(a) loans, subject to secured borrowings as the SBA has guaranteed payment of the principal).

June 30, 2014
  Commercial
Mortgage Loans		   SBA 7(a) Loans   Totals  
 
   (dollars in thousands)
  

Current

   $ 119,326     99.3 % $ 32,836     99.5 % $ 152,162     99.4 %

Between 29 and 59 days delinquent

     —     —     162     0.5     162     0.1  

Between 60 and 89 days delinquent

     —     —     —     —     —     —  

Over 89 days delinquent

     827     0.7     —     —     827     0.5  
                           
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   $ 120,153     100.0 % $ 32,998     100.0 % $ 153,151     100.0 %
                           
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        Loan Portfolio Classification—Management closely monitors our loans which require evaluation for loan loss reserves based on specific identification metrics which are classified into three categories: Doubtful, Substandard and Other Assets Especially Mentioned ("OAEM"). Loans classified as Doubtful are generally loans which are not complying with their contractual terms, the collection of the balance of the principal is considered impaired and on which the fair value of the collateral is less than the remaining unamortized principal balance. These loans are typically placed on non-accrual status and are generally in the foreclosure process. Loans classified as Substandard are generally those loans that are either not complying or had previously not complied with their contractual terms and have other credit weaknesses which may make payment default or principal exposure likely but not yet certain. Loans classified as OAEM are generally loans for which the credit quality of the borrowers has temporarily deteriorated. Typically, the borrowers are current on their payments; however, they may be delinquent on their property taxes, insurance, or franchise fees or may be under agreements which provide for interest only payments during a short period of time.

        Management has classified our Loans Receivable Subject to Credit Risk as follows:

June 30, 2014
  Commercial
Mortgage Loans		   SBA 7(a) Loans   Totals  
 
   (dollars in thousands)
  

Satisfactory

   $ 116,527     97.0 % $ 32,368     98.1 % $ 148,895     97.2 %

OAEM

     1,947     1.6     —     —     1,947     1.3  

Substandard

     849     0.7     539     1.6     1,388     0.9  

Doubtful

     830     0.7     91     0.3     921     0.6  
                           
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   $ 120,153     100.0 % $ 32,998     100.0 % $ 153,151     100.0 %
                           
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