Loan Portfolio (Tables)

9 Months Ended

Sep. 30, 2012

The Company segregates its loan portfolio into three primary loan segments: Real Estate Loans, Commercial Loans, and Consumer Loans. Real estate loans are further segregated into the following classes: construction loans, loans secured by farmland, loans secured by 1-4 family residential real estate, and other real estate loans. Other real estate loans include commercial real estate loans. The consolidated loan portfolio was composed of the following on the dates indicated:

	September 30, 2012					December 31, 2011
	Outstanding Balance		Percent of Total Portfolio			Outstanding Balance		Percent of Total Portfolio
	(In Thousands)					(In Thousands)
Real estate loans:
Construction	$	48,740		7.0	%	$	42,208		6.3	%
Secured by farmland		9,438		1.4	%		10,047		1.5	%
Secured by 1-4 family residential		254,079		36.7	%		236,760		35.3	%
Other real estate loans		258,679		37.4	%		275,428		41.0	%
Commercial loans		108,962		15.7	%		94,427		14.1	%
Consumer loans		12,466		1.8	%		12,523		1.8	%
		692,364		100.0	%		671,393		100.0	%
Less allowance for loan losses		13,941					14,623
Net loans	$	678,423				$	656,770

Past due loans by class of loans

The following table presents a contractual aging of the recorded investment in past due loans by class of loans as of September 30, 2012 and December 31, 2011.

	September 30, 2012
					(In thousands)
	30-59 Days Past Due		60-89 Days Past Due		90 Days Or Greater		Total Past Due		Current		Total Loans
Real estate loans:
Construction	$	175	$	—	$	3,142	$	3,317	$	45,423	$	48,740
Secured by farmland		—		—		—		—		9,438		9,438
Secured by 1-4 family residential		4,838		208		2,817		7,863		246,216		254,079
Other real estate loans		855		253		6,794		7,902		250,777		258,679
Commercial loans		15		126		1,960		2,101		106,861		108,962
Consumer loans		61		22		33		116		12,350		12,466
Total	$	5,944	$	609	$	14,746	$	21,299	$	671,065	$	692,364

	December 31, 2011
					(In thousands)
	30-59 Days Past Due		60-89 Days Past Due		90 Days Or Greater		Total Past Due		Current		Total Loans
Real estate loans:
Construction	$	696	$	—	$	3,285	$	3,981	$	38,227	$	42,208
Secured by farmland		415		—		—		415		9,632		10,047
Secured by 1-4 family residential		2,036		1,721		7,639		11,396		225,364		236,760
Other real estate loans		6,079		1,736		1,466		9,281		266,147		275,428
Commercial loans		1,751		121		315		2,187		92,240		94,427
Consumer loans		23		—		—		23		12,500		12,523
Total	$	11,000	$	3,578	$	12,705	$	27,283	$	644,110	$	671,393

The following table presents the recorded investment in nonaccrual loans and loans past due 90 days or more and still accruing by class of loans as of September 30, 2012 and December 31, 2011:

	September 30, 2012				December 31, 2011
	Nonaccrual		Past due 90 days or more and still accruing		Nonaccrual		Past due 90 days or more and still accruing
	(In Thousands)
Real estate loans:
Construction	$	2,943	$	268	$	3,804	$	86
Secured by 1-4 family residential		8,653		399		11,839		1,097
Other real estate loans		8,881		130		7,567		—
Commercial loans		2,176		60		2,136		50
Consumer loans		30		3		—		—
Total	$	22,683	$	860	$	25,346	$	1,233

Summary of loan classifications by class of loan

The following tables present a summary of loan classifications by class of loan as of September 30, 2012 and December 31, 2011:

September 30, 2012

(In Thousands)

	Real Estate Construction		Real Estate Secured by Farmland		Real Estate Secured by 1-4 Family Residential		Other Real Estate Loans		Commercial		Consumer		Total
Pass	$	27,342	$	8,629	$	230,963	$	218,427	$	102,620	$	12,310	$	600,291
Special Mention		15,810		199		4,235		23,155		3,442		60		46,901
Substandard		4,553		610		17,396		16,044		2,772		66		41,441
Doubtful		1,035		—		1,485		1,053		128		30		3,731
Loss		—		—		—		—		—		—		—
Ending Balance	$	48,740	$	9,438	$	254,079	$	258,679	$	108,962	$	12,466	$	692,364

	December 31, 2011
	(In thousands)

	Real Estate Construction		Real Estate Secured by Farmland		Real Estate Secured by 1-4 Family Residential		Other Real Estate Loans		Commercial		Consumer		Total
Pass	$	22,250	$	9,235	$	207,332	$	239,156	$	87,731	$	12,448	$	578,152
Special Mention		5,764		199		10,773		23,434		4,127		61		44,358
Substandard		13,163		613		17,062		12,592		2,374		14		45,818
Doubtful		1,031		—		1,593		246		195		—		3,065
Loss		—		—		—		—		—		—		—
Ending Balance	$	42,208	$	10,047	$	236,760	$	275,428	$	94,427	$	12,523	$	671,393

Loans identified as impaired by class of loan

The following table presents loans identified as impaired by class of loan as of and for the nine months ended September 30, 2012:

	September 30, 2012
	(In thousands)
	Recorded Investment		Unpaid Principal Balance		Related Allowance		Average Recorded Investment		Interest Income Recognized
With no related allowance recorded:
Real estate loans:
Construction	$	1,629	$	2,180	$	—	$	2,071	$	—
Secured by farmland		—		—		—		—		—
Secured by 1-4 family residential		3,136		3,554		—		3,360		36
Other real estate loans		3,814		3,857		—		4,438		91
Commercial loans		1,938		1,938		—		1,919		—
Consumer loans		—		—		—		—		—
Total with no related allowance		10,517		11,529		—		11,788		127

With an allowance recorded:
Real estate loans:
Construction		1,314		2,539		198		1,913		—
Secured by farmland		—		—		—		—		—
Secured by 1-4 family residential		6,802		7,460		2,577		7,034		30
Other real estate loans		7,852		7,952		1,408		7,975		51
Commercial loans		471		492		361		467		13
Consumer loans		30		30		30		30		—
Total with a related allowance		16,469		18,473		4,574		17,419		94
Total	$	26,986	$	30,002	$	4,574	$	29,207	$	221

The following table presents loans identified as impaired by class of loan as of and for the year ended December 31, 2011:

	December 31, 2011
	(In thousands)
	Recorded Investment		Unpaid Principal Balance		Related Allowance		Average Recorded Investment		Interest Income Recognized
With no related allowance recorded:
Real estate loans:
Construction	$	2,992	$	3,652	$	—	$	3,948	$	—
Secured by farmland		—		—		—		—
Secured by 1-4 family residential		3,978		4,656		—		4,424		7
Other real estate loans		4,732		4,775		—		5,729		95
Commercial loans		1,751		1,751		—		1,735		—
Consumer loans		—		—		—		—		—
Total with no related allowance		13,453		14,834		—		15,836		102

With an allowance recorded:
Real estate loans:
Construction		812		842		328		812		—
Secured by farmland		—		—		—		—
Secured by 1-4 family residential		8,697		10,417		3,076		9,047		17
Other real estate loans		5,581		5,581		1,192		5,076		64
Commercial loans		656		678		502		662		14
Consumer loans		—		—		—		—		—
Total with a related allowance		15,746		17,518		5,098		15,597		95
Total	$	29,199	$	32,352	$	5,098	$	31,433	$	197

Loans modified in a TDR by class of loan

The following table presents by class of loan, information related to loans modified in a TDR during the three months ended September 30, 2012:

	Loans modified as TDR's
	For the three months ended
	September 30, 2012
Class of Loan	Number of Contracts	Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment
	(In thousands)
Real estate loans:
Construction	—	$	—	$	—
Secured by farmland	—	—		—
Secured by 1-4 family residential	3	2,163		1,595
Other real estate loans	1	1,528		1,524
Total real estate loans	4	3,691		3,119
Commercial loans	—	—		—
Consumer loans	1	217		213
Total	5	$	3,908	$	3,332

During the three months ended September 30, 2012, the Company modified five loans that were considered to be TDRs and are summarized in the above table. The interest rate was lowered on three of the loans and repayment terms were modified on the other two.

	Loans modified as TDR's
	For the nine months ended
	September 30, 2012
Class of Loan	Number of Contracts	Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment
	(In thousands)
Real estate loans:
Construction	—	$	—	$	—
Secured by farmland	—	—		—
Secured by 1-4 family residential	5	3,075		2,486
Other real estate loans	1	1,528		1,524
Total real estate loans	6	4,603		4,010
Commercial loans	—	—		—
Consumer loans	1	217		213
Total	7	$	4,820	$	4,223