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Loans Receivable, net (Tables)
 9 Months Ended
Sep. 30, 2012
Loans Receivable, net [Abstract]  
Loans receivables, net

Loans receivable, net, consisted of the following:

 

                 
    September 30,     December 31,  
    2012     2011  
    (In thousands)  

Commercial mortgage loans

   $ 134,155     $ 134,835  

SBIC commercial mortgage loans

     42,886       32,416  

SBA 7(a) loans, subject to secured borrowings

     38,150       30,151  

SBA 7(a) loans

     28,488       23,238  

Commercial mortgage loans, subject to structured notes payable (1)

     —         15,474  
   

 

 

    

 

 

  

Total loans receivable

     243,679       236,114  

Adjusted by:

                

Deferred capitalized costs, net

     302       125  

Loan loss reserves

     (2,067 )      (1,812 ) 
   

 

 

    

 

 

  

Loans receivable, net

   $ 241,914     $ 234,427  
   

 

 

    

 

 

  

 

(1) The structured notes were repaid on February 15, 2012.
Aging of loans Receivable

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). Balances are prior to loan loss reserves and deferred capitalized costs, net.

 

                                                 

September 30, 2012

  

Category

   Totals     Commercial
Mortgage
Loans		     SBA 7(a)
Loans		  
    (Dollars in thousands)  

Current (1)

   $ 205,503       100.0 %    $ 177,041       100.0 %    $ 28,462       99.9 % 

Between 30 and 59 days delinquent

     —         —         —         —         —         —    

Between 60 and 89 days delinquent

     26       —         —         —         26       0.1 % 

Over 89 days delinquent

     —         —         —         —         —         —    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  
    $ 205,529       100.0 %    $ 177,041       100.0 %    $ 28,488       100.0 % 
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

(1) Includes $13.1 million of loans classified as troubled debt restructurings which were current at September 30, 2012 based on revised note terms.

 

                                                 

December 31, 2011

  

Category

   Totals     Commercial
Mortgage
Loans		     SBA 7(a)
Loans		  
    (Dollars in thousands)  

Current (1)

   $ 202,217       98.2 %    $ 179,497       98.2 %    $ 22,720       97.7 % 

Between 30 and 59 days delinquent

     1,224       0.6 %      1,090       0.6 %      134       0.6 % 

Between 60 and 89 days delinquent

     696       0.3 %      696       0.4 %      —         —    

Over 89 days delinquent (2)

     1,826       0.9 %      1,442       0.8 %      384       1.7 % 
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  
    $ 205,963       100.0 %    $ 182,725       100.0 %    $ 23,238       100.0 % 
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

(1) Includes $6.3 million of loans classified as troubled debt restructurings which were current based on revised note terms. Of these loans, $5.6 million are paying interest only.
(2) Includes a $1.4 million loan on which the borrower filed for Chapter 11 Bankruptcy. We were classified as a secured creditor in the bankruptcy proceeding.
Classified loans receivable

Management has classified our Loans Receivable Subject to Credit Risk as follows (balances represent our investment in the loans prior to loan loss reserves and deferred capitalized costs):

 

                                                 
    September 30, 2012  
     Totals     %     Commercial
Mortgage
Loans		     %     SBA 7(a)
Loans		     %  
    (Dollars in thousands)  

Satisfactory

   $ 183,430       89.3 %    $ 155,388       87.8 %    $ 28,042       98.4 % 

OAEM

     10,075       4.9 %      9,993       5.6 %      82       0.3 % 

Substandard

     11,999       5.8 %      11,660       6.6 %      339       1.2 % 

Doubtful

     25       0.0 %      —         —         25       0.1 % 
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  
    $ 205,529       100.0 %    $ 177,041       100.0 %    $ 28,488       100.0 % 
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  
   
    December 31, 2011  
     Totals     %     Commercial
Mortgage
Loans		     %     SBA 7(a)
Loans		     %  
    (Dollars in thousands)  

Satisfactory

   $ 189,836       92.2 %    $ 167,397       91.6 %    $ 22,439       96.5 % 

OAEM

     3,354       1.6 %      3,317       1.8 %      37       0.2 % 

Substandard

     10,790       5.2 %      10,569       5.8 %      221       1.0 % 

Doubtful

     1,983       1.0 %      1,442       0.8 %      541       2.3 % 
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  
    $ 205,963       100.0 %    $ 182,725       100.0 %    $ 23,238       100.0 % 
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  
Loan loss reserves

The activity in our loan loss reserves was as follows:

 

                         
    Nine Months Ended September 30, 2012  
    Total     Commercial
Mortgage
Loans		     SBA 7(a)
Loans		  
    (In thousands)  

Balance, beginning of year

   $ 1,812     $ 1,329     $ 483  

Provision for loan losses

     1,203       1,103       100  

Reduction of loan losses

     (149 )      (115 )      (34 ) 

Recoveries

     (408 )      (408 )      —    

Principal balances written-off, net

     (391 )      (219 )      (172 ) 
   

 

 

    

 

 

    

 

 

  

Balance, end of period

   $ 2,067     $ 1,690     $ 377  
   

 

 

    

 

 

    

 

 

  
                         
    Nine Months Ended September 30, 2011  
    Total     Commercial
Mortgage
Loans		     SBA 7(a)
Loans		  
    (In thousands)  

Balance, beginning of year

   $ 1,609     $ 1,303     $ 306  

Provision for loan losses

     628       246       382  

Reduction of loan losses

     (266 )      (241 )      (25 ) 

Principal balances written-off

     (144 )      (17 )      (127 ) 
   

 

 

    

 

 

    

 

 

  

Balance, end of period

   $ 1,827     $ 1,291     $ 536  
   

 

 

    

 

 

    

 

 

  
Loans considered to be impaired loans

Information on those loans considered to be impaired loans was as follows:

 

                                                 
    September 30, 2012     December 31, 2011  
    Total     Commercial
Mortgage
Loans		     SBA 7(a)
Loans		     Total     Commercial
Mortgage
Loans		     SBA 7(a)
Loans		  
    (In thousands)  

Impaired loans requiring reserves (1)

   $ 10,123     $ 10,098     $ 25     $ 7,411     $ 7,027     $ 384  

Impaired loans expected to be fully recoverable (1)

     3,124       2,146       978       846       689       157  
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Total impaired loans (2)

   $ 13,247     $ 12,244     $ 1,003     $ 8,257     $ 7,716     $ 541  
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Loan loss reserves

   $ 701     $ 676     $ 25     $ 563     $ 372     $ 191  
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

(1) Balances represent our recorded investment and include loans classified as troubled debt restructurings.
(2) The unpaid principal balance of our impaired commercial mortgage loans was $12,717,000 and $7,940,000 at September 30, 2012 and December 31, 2011, respectively. The unpaid principal balance of our impaired SBA 7(a) loans (excluding the government guaranteed portion) was $366,000 and $593,000 at September 30, 2012 and December 31, 2011, respectively.

 

                                                 
    Three Months Ended September 30, 2012     Three Months Ended September 30, 2011  
    Total     Commercial
Mortgage
Loans		     SBA 7(a)
Loans		     Total     Commercial
Mortgage
Loans		     SBA 7(a)
Loans		  
    (In thousands)  

Average impaired loans

   $ 9,885     $ 8,799     $ 1,086     $ 9,420     $ 8,744     $ 676  
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Interest income on impaired loans

   $ 88     $ 84     $ 4     $ 28     $ 26     $ 2  
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  
     
    Nine Months Ended September 30, 2012     Nine Months Ended September 30, 2011  
    Total     Commercial
Mortgage
Loans		     SBA 7(a)
Loans		     Total     Commercial
Mortgage
Loans		     SBA 7(a)
Loans		  
    (In thousands)  

Average impaired loans

   $ 8,788     $ 8,083     $ 705     $ 8,504     $ 7,952     $ 552  
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Interest income on impaired loans

   $ 277     $ 266     $ 11     $ 228     $ 213     $ 15  
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  
Troubled Debt Restructurings

Information on our troubled debt restructurings which consisted of eight commercial mortgage loans and one SBA 7(a) loan was as follows at September 30, 2012:

 

                                 
    Commercial Mortgage Loans     SBA 7(a) Loan  
          Unpaid           Unpaid  
    Recorded     Principal     Recorded     Principal  
    Investment     Balance     Investment     Balance  
    (In thousands)  

Troubled debt restructurings requiring reserves

   $ 10,098     $ 10,521     $ 854     $ 845  

Troubled debt restructurings without reserves (1)

     2,146       2,197       —         —    
   

 

 

    

 

 

    

 

 

    

 

 

  

Total troubled debt restructurings

   $ 12,244     $ 12,718     $ 854     $ 845  
   

 

 

    

 

 

    

 

 

    

 

 

  

Loan loss reserves

   $ 676             $ 12          
   

 

 

            

 

 

          

 

(1) The SBA 7(a) loan recorded investment and unpaid principal balance includes the government guaranteed portion of $634,000 on which we have no credit loss exposure.