Note 6 - Loans Held for Sale

6 Months Ended

Jun. 30, 2014

6.	Loans held for sale

Loans held for sale are carried at the lower of cost or estimated fair value. At June 30, 2014, the Bank did not have any loans held for sale. At December 31, 2013, the Bank had one multi-family loan held for sale of $0.4 million.

The Company has implemented a strategy of selling certain delinquent and non-performing loans. Once the Company has decided to sell a loan, the sale usually closes in a short period of time, generally within the same quarter. Loans designated as held for sale are reclassified from loans held for investment to loans held for sale. Terms of sale include cash due upon the closing of the sale, no contingencies or recourse to the Company and servicing is released to the buyer.

The following tables show delinquent and non-performing loans sold during the periods indicated:

	For the three months ended June 30, 2014
(Dollars in thousands)	Loans sold		Proceeds		Net recoveries		Net gain (loss)

Multi-family residential		3	$	1,478	$	76	$	-
Commercial real estate		1		430		-		-
Total		4	$	1,908	$	76	$	-

	For the three months ended June 30, 2013
(Dollars in thousands)	Loans sold		Proceeds		Net charge-offs			Net gain (loss)

Multi-family residential		9	$	2,447	$	(468	)	$	-
Commercial real estate		5		2,349		(18	)		-
One-to-four family - mixed-use property		24		5,589		(70	)		-
Total		38	$	10,385	$	(556	)	$	-

The above table does not include the sale of one performing commercial real estate loan for $2.4 million, resulting in a net gain of $184,000 during the three months ended June 30, 2013.

The following tables show delinquent and non-performing loans sold during the periods indicated:

	For the six months ended June 30, 2014
(Dollars in thousands)	Loans sold		Proceeds		Net (charge-offs) recoveries			Net gain (loss)

Multi-family residential		7	$	3,216	$	(70	)	$	-
Commercial real estate		3		2,047		295			-
One-to-four family - mixed-use property		6		2,069		38			-
Total		16	$	7,332	$	263		$	-

	For the six months ended June 30, 2013
(Dollars in thousands)	Loans sold		Proceeds		Net charge-offs			Net gain (loss)

Multi-family residential		15	$	7,059	$	(576	)	$	6
Commercial real estate		7		3,464		(94	)		-
One-to-four family - mixed-use property		30		7,961		(110	)		(15	)
Commercial business and other		2		66		(185	)		-
Total		54	$	18,550	$	(965	)	$	(9	)

The above table does not include the sale of one performing commercial real estate loan for $2.4 million, resulting in a net gain of $184,000 during the six months ended June 30, 2013.