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Loans Receivable, net (Tables)
 12 Months Ended
Dec. 31, 2012
Loans Receivable, net [Abstract]  
Loans receivables, net

Loans receivable, net, consisted of the following:

 

                 
    December 31,  
    2012     2011  
    (In thousands)  

Commercial mortgage loans

     $ 128,401       $   134,835    

SBIC commercial mortgage loans

     47,621         32,416    

SBA 7(a) loans, subject to secured borrowings

     37,909         30,151    

SBA 7(a) loans

     28,196         23,238    

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

     -         15,474    
   

 

 

    

 

 

  

Total loans receivable

     242,127         236,114    

Add/(deduct):

                

 Deferred capitalized costs, net

     277         125    

 Loan loss reserves

     (3,413)        (1,812)   
   

 

 

    

 

 

  

Loans receivable, net

     $             238,991         $             234,427    
   

 

 

    

 

 

  

 

(1)

We repaid the remaining 2003 Joint Venture structured notes on February 15, 2012.

Aging of loans Receivable
                                                 

December 31, 2012

  

Category

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

Current (1)

     $ 198,282         97.1%       $ 170,429         96.8%       $ 27,853         98.8%  

Between 30 and 59 days delinquent (2)

     2,824         1.4%       2,482         1.4%       342         1.2%  

Between 60 and 89 days delinquent

     1         -       -         -       1         -  

Over 89 days delinquent (3)

     3,111         1.5%       3,111         1.8%       -         -  
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  
      $         204,218           100.0%       $         176,022           100.0%       $         28,196           100.0%  
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

(1)

Includes $7.6 million of commercial mortgage loans classified as troubled debt restructurings which are current at December 31, 2012 based on revised note terms.

(2)

Includes $2.3 million of loans classified as troubled debt restructurings. We are currently in the process of foreclosing on the collateral underlying an SBA 7(a) Program loan – a limited service hospitality property - with a principal balance of $211,000 (excluding the government guaranteed portion as it was sold as a hybrid).

(3)

Loans are classified as troubled debt restructurings. We are currently in the process of foreclosing on the collateral underlying these loans – two limited service hospitality properties.

                                                 

 

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 were paying interest only.

(2)

Includes a $1.4 million loan on which the borrowers filed for Chapter 11 Bankruptcy. We were classified as a secured creditor in the bankruptcy proceedings.

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 commitment fees):

 

                                                 
    December 31, 2012  
    Totals     %     Commercial
Mortgage
Loans		     %     SBA 7(a)
Loans		     %  
    (Dollars in thousands)  

Satisfactory

     $ 187,749         92.0%         $ 159,994         90.9%         $ 27,755         98.5%    

OAEM

     81         -           -           -           81         0.3%    

Substandard

     13,043         6.4%         12,917         7.3%         126         0.4%    

Doubtful

     3,345         1.6%         3,111         1.8%         234         0.8%    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  
      $         204,218           100.0%         $         176,022           100.0%         $         28,196           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         96.6%    

OAEM

     3,354         1.6%         3,317         1.8%         37         0.1%    

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:

 

                         
    Year Ended December 31, 2012  
    Total     Commercial
Mortgage
Loans		     SBA 7(a)
Loans		  
    (In thousands)  

Balance, beginning of year

     $ 1,812         $ 1,329       $ 483    

Provision for loan losses

     2,505         2,219         286    

Reduction of loan losses

     (104)        (70)        (34)   

Recoveries

     (467)        (467)        -    

Principal balances written-off, net

     (333)        (161)        (172)   
   

 

 

    

 

 

    

 

 

  

Balance, end of year

     $         3,413         $         2,850         $         563    
   

 

 

    

 

 

    

 

 

  
                         
    Year Ended December 31, 2011  
    Total     Commercial
Mortgage
Loans		     SBA 7(a)
Loans		  
    (In thousands)  

Balance, beginning of year

     $ 1,609         $ 1,303         $ 306    

Provision for loan losses

     826         429         397    

Reduction of loan losses

     (366)        (342)        (24)   

Principal balances written-off

     (257)        (61)        (196)   
   

 

 

    

 

 

    

 

 

  

Balance, end of year

     $         1,812         $         1,329         $         483    
   

 

 

    

 

 

    

 

 

  

 

                         
    Year Ended December 31, 2010  
    Total     Commercial
Mortgage
Loans		     SBA 7(a)
Loans		  
    (In thousands)  

Balance, beginning of year

     $ 1,257         $ 1,055         $ 202    

Provision for loan losses

     1,019         607         412    

Reduction of loan losses

     (378)        (309)        (69)   

Consolidation of the 2000 Joint Venture and the 1998 Partnership reserves

     184        184         -    

Principal balances written-off

     (473)        (234)        (239)   
   

 

 

    

 

 

    

 

 

  

Balance, end of year

     $         1,609       $         1,303         $         306    
   

 

 

    

 

 

    

 

 

  
Loans considered to be impaired loans

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

 

                         
    At December 31, 2012  
    Total     Commercial
Mortgage
Loans 		    SBA 7(a)
Loans		  
    (In thousands)  

Impaired loans requiring reserves (1)

     $             10,927         $             10,049         $             878    

Impaired loans expected to be fully
recoverable (1)

     2,244         2,123         121    
   

 

 

    

 

 

    

 

 

  

Total impaired loans (2)

     $ 13,171         $ 12,172         $ 999    
   

 

 

    

 

 

    

 

 

  
       

Loan loss reserves

     $ 1,535         $ 1,382         $ 153    
   

 

 

    

 

 

    

 

 

  
   
    At December 31, 2011  
    Total     Commercial
Mortgage
Loans 		    SBA 7(a)
Loans		  
    (In thousands)  

Impaired loans requiring reserves (1)

     $             7,411         $             7,027         $             384    

Impaired loans expected to be fully
recoverable (1)

     846         689         157    
   

 

 

    

 

 

    

 

 

  

Total impaired loans (3)

     $             8,257         $             7,716           $             541    
   

 

 

    

 

 

    

 

 

  
       

Loan loss reserves

     $             563         $             372         $             191    
   

 

 

    

 

 

    

 

 

  
   
    At December 31, 2010  
    Total     Commercial
Mortgage
Loans 		    SBA 7(a)
Loans		  
    (In thousands)  

Impaired loans requiring reserves (1)

     $             687         $             419         $             268    

Impaired loans expected to be fully
recoverable (1)

     228         228         -    
   

 

 

    

 

 

    

 

 

  

Total impaired loans (4)

     $             915         $             647         $ 268    
   

 

 

    

 

 

    

 

 

  
       

Loan loss reserves

     $ 219         $ 25         $ 194    
   

 

 

    

 

 

    

 

 

  

 

 

(1)

Balances represent our recorded investment. For 2012 and 2011, includes loans classified as troubled debt restructurings.

(2)

The unpaid principal balance of our impaired commercial mortgage loans was $12,704,000 at December 31, 2012. The unpaid principal balance of our impaired SBA 7(a) loans (excluding the government guaranteed portion) was $362,000 at December 31, 2012.

(3)

The unpaid principal balance of our impaired commercial mortgage loans was $7,940,000 at December 31, 2011. The unpaid principal balance of our impaired SBA 7(a) loans (excluding the government guaranteed portion) was $593,000 at December 31, 2011.

(4)

The unpaid principal balance of our impaired commercial mortgage loans was $678,000 at December 31, 2010. The unpaid principal balance of our impaired SBA 7(a) loans (excluding the government guaranteed portion) was $288,000 at December 31, 2010.

 

                         
    Year Ended December 31, 2012  
    Total     Commercial
Mortgage
Loans		     SBA 7(a)
Loans		  
    (In thousands)  

Average impaired loans

     $             9,895         $             9,116         $             779    
   

 

 

    

 

 

    

 

 

  
       

Interest income on impaired loans

     $             372         $             359         $ 13    
   

 

 

    

 

 

    

 

 

  
   
    Year Ended December 31, 2011  
    Total     Commercial
Mortgage
Loans		     SBA 7(a)
Loans		  
    (In thousands)  

Average impaired loans

     $             8,176         $             7,610         $             566    
   

 

 

    

 

 

    

 

 

  
       

Interest income on impaired loans

     $             290         $             271         $             19    
   

 

 

    

 

 

    

 

 

  
   
    Year Ended December 31, 2010  
    Total     Commercial
Mortgage
Loans 		    SBA 7(a)
Loans		  
    (In thousands)  

Average impaired loans

     $ 4,317         $ 3,558         $ 759    
   

 

 

    

 

 

    

 

 

  
       

Interest income on impaired loans

     $ 114         $ 89         $ 25    
   

 

 

    

 

 

    

 

 

  
Troubled Debt Restructurings

Information on our troubled debt restructurings was as follows at December 31, 2012 and 2011:

 

                                 
    December 31, 2012  
    Commercial Mortgage Loans     SBA 7(a) Loan  
    Recorded
Investment		     Unpaid
Principal
Balance		     Recorded
Investment		     Unpaid
Principal
Balance		  
    (In thousands)  

Troubled debt restructurings requiring
reserves (1)

     $ 10,049         $             10,531         $             854         $             846    

Troubled debt restructurings without reserves

     2,123         2,172         -         -    
   

 

 

    

 

 

    

 

 

    

 

 

  

Total troubled debt restructurings

     $ 12,172         $ 12,703         $ 854         $ 846    
   

 

 

    

 

 

    

 

 

    

 

 

  
         

Number of loans

     8                 1            
   

 

 

            

 

 

          
         

Loan loss reserves

     $             1,382                 $ 130            
   

 

 

            

 

 

          

 

(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. This loan is no longer complying with its modified terms, including lack of required payments. We are currently in the process of foreclosing on the collateral underlying this loan.

                 
    December 31, 2011  
    Commercial Mortgage Loans  
    Recorded
Investment		     Unpaid
Principal
Balance		  
    (In thousands)  

Troubled debt restructurings requiring reserves

     $             5,591         $             5,730    

Troubled debt restructurings without reserves

     689         749    
   

 

 

    

 

 

  

Total troubled debt restructurings

     $ 6,280         $ 6,479    
   

 

 

    

 

 

  
     

Number of loans

     4            
   

 

 

          
     

Loan loss reserves

     $ 236