LOANS RECEIVABLE

12 Months Ended

Dec. 31, 2017

Receivables [Abstract]

LOANS RECEIVABLE

LOANS RECEIVABLE

Loans receivable consist of the following:

	December 31,
	2017			2016
	(in thousands)
SBA 7(a) loans, subject to credit risk	$	58,298		$	43,376
SBA 7(a) loans, subject to secured borrowings	21,664			29,456
Commercial mortgage loans	424			2,597
Loans receivable	80,386			75,429
Deferred capitalized costs	1,132			582
Loan loss reserves	(462		)	(271		)
Loans receivable, net	$	81,056		$	75,740

SBA 7(a) Loans, Subject to Credit Risk—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.

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. There is no credit risk associated with these loans since the SBA has guaranteed payment of the principal.

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

At December 31, 2017 and 2016, 100.0% and 99.7%, respectively, of our loans subject to credit risk were current with the remainder ($0 and $249,000, respectively) greater than 29 days delinquent. We classify loans with negative characteristics in substandard categories ranging from special mention to doubtful. At December 31, 2017 and 2016, $388,000 and $804,000, respectively, of loans subject to credit risk were classified in substandard categories.

At December 31, 2017 and 2016, our loans subject to credit risk were 97.3% and 93.6%, respectively, concentrated in the hospitality industry.