XML 82 R11.htm IDEA: XBRL DOCUMENT v2.4.0.6
LOANS RECEIVABLE
 12 Months Ended
Jun. 30, 2012
LOANS RECEIVABLE

NOTE 3—LOANS RECEIVABLE

Loans receivable at June 30, 2012 and 2011 consisted of the following:

 

     2012     2011  

One-to-Four Family Loans:

     

1-4 Family Owner Occupied

    $ 58,743,933      $ 65,501,675   

1-4 Family Non-Owner Occupied

      34,368,320        39,705,016   

1-4 Family Second Mortgage

      29,202,145        32,897,907   

Home Equity Lines of Credit

      65,908,899        71,947,078   

Home Equity Investment Lines of Credit

      5,645,851        8,031,953   

One-to-Four Family Construction Loans:

     

1-4 Family Construction

      514,052        1,135,786   

1-4 Family Construction Models/Speculative

      1,608,137        5,140,560   

Multi-Family Loans:

     

Multi-Family

      53,959,459        50,294,026   

Multi-Family Second Mortgage

      145,642        421,489   

Multi-Family Construction

      5,375,000        1,593,981   

Commercial Real Estate Loans:

     

Commercial

      198,287,457        195,318,830   

Commercial Second Mortgage

      5,750,283        8,187,212   

Commercial Lines of Credit

      22,335,619        17,020,580   

Commercial Construction

      7,732,736        4,236,607   

Commercial and Industrial Loans

      35,443,184        30,721,403   

Land Loans:

     

Lot Loans

      12,091,093        22,924,077   

Acquisition and Development Loans

      19,093,006        23,022,620   

Consumer Loans

      2,112,708        162,266   
  

 

 

    

 

 

  

Total loans receivable

      558,317,524        578,263,066   

Net deferred loan origination fees

      (637,144 )      (984,136 ) 

Allowance for loan losses

      (16,052,865 )      (29,996,893 ) 
  

 

 

    

 

 

  

Total loans receivable, net

    $ 541,627,515      $ 547,282,037   
  

 

 

    

 

 

  

The following table presents activity in the allowance for loan losses by portfolio segment for the year ended June 30, 2012:

 

    One-to-Four
Family		     One-to-Four
Family
Construction		     Multi-
Family		     Commercial
Real Estate		     Commercial
and
Industrial		     Land     Consumer     Total  

Beginning balance at June 30, 2011

   $ 8,841,454      $ 1,266,740      $ 1,767,336      $ 8,458,942      $ 1,663,894      $ 7,891,305      $ 107,222      $ 29,996,893   

Provision for loan losses

     4,176,679        321,391        753,393        1,375,624        (482,403 )      934,922        (97,606 )      6,982,000   

Charge-offs

     (7,398,876 )      (1,287,819 )      (617,591 )      (4,884,634 )      (546,789 )      (7,068,348 )      —          (21,804,057 ) 

Recoveries

     146,019        5,000        —          134,247        293,341        299,422        —          878,029   
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Ending balance at June 30, 2012

   $ 5,765,276      $ 305,312      $ 1,903,138      $ 5,084,179      $ 928,043      $ 2,057,301      $ 9,616      $ 16,052,865   
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

The following is a summary of the changes in the allowance for loan losses for the years ended June 30, 2011 and June 30, 2010 is as follows:

 

     2011     2010  

Beginning balance

    $ 31,519,466      $ 31,483,205   

Provision for loan losses

      13,540,000        14,928,000   

Loans charged-off

      (15,528,353 )      (14,891,739 ) 

Recoveries

      465,780        —     
  

 

 

    

 

 

  

Ending balance

    $ 29,996,893      $ 31,519,466   
  

 

 

    

 

 

  

As of December 31, 2011, the Company implemented an enhanced loan accounting system, which provides for the systematic recording of charged-off loans for financial recognition without losing its ability to track the legal contractual amounts. As such, during the current fiscal year, the Company charged off those loan amounts which had previously been specifically impaired through the use of the specific valuation allowance. As of June 30, 2012, any remaining specific impairments known in prior periods as specific valuation allowances are now tracked as specific allocations to the allowance. In addition to reducing loan balances, including nonperforming loans, this new enhanced loan accounting system had the impact of elevating reported charge-offs for the period and reducing the allowance for loan losses associated with specific reserves.

The following table presents the allowance for loan losses and the recorded investment in loans by portfolio segment and based on the impairment method as of June 30, 2012. The recorded investment in loans includes the unpaid principal balance and unamortized loan origination fees, but excludes accrued interest receivable which is not considered to be material.

 

    One-to-Four
Family		     One-to-Four
Family
Construction		     Multi-
Family		     Commercial
Real
Estate		     Commercial
and
Industrial		     Land     Consumer     Total  

Allowance for loan losses

                

Ending allowance balance attributable to loans

                

Individually evaluated for impairment

   $ 665,033      $ 101,716      $ —        $ 98,725      $ 300,860      $ 252,000      $ —        $ 1,418,334   

Collectively evaluated for impairment

     5,100,243        203,596        1,903,138        4,985,454        627,183        1,805,301        9,616        14,634,531   
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Total ending allowance balance

   $ 5,765,276      $ 305,312      $ 1,903,138      $ 5,084,179      $ 928,043      $ 2,057,301      $ 9,616      $ 16,052,865   
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Loans

                

Loans individually evaluated for impairment

   $ 13,243,350      $ 880,749      $ 622,228      $ 11,902,730      $ 740,297      $ 7,189,109      $ —        $ 34,578,463   

Loans collectively evaluated for impairment

     180,404,558        1,239,018        58,789,996        221,936,205        34,662,439        23,959,404        2,110,297        523,101,917   
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Total ending loans balance

   $ 193,647,908      $ 2,119,767      $ 59,412,224      $ 233,838,935      $ 35,402,736      $ 31,148,513      $ 2,110,297      $ 557,680,380   
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

The following table presents the allowance for loan losses and the recorded investment in loans by portfolio segment and based on the impairment method as of June 30, 2011. The recorded investment in loans includes the unpaid principal balance and unamortized loan origination fees, but excludes accrued interest receivable which is not considered to be material.

 

    One-to-Four
Family		     One-to-Four
Family
Construction		     Multi-
Family		     Commercial
Real
Estate		     Commercial
and
Industrial		     Land     Consumer     Total  

Allowance for loan losses

                

Ending allowance balance attributable to loans

                

Individually evaluated for impairment

   $ 3,493,542      $ 935,146      $ 117,896      $ 2,418,681      $ 768,973      $ 5,300,754      $ —        $ 13,034,992   

Collectively evaluated for impairment

     5,347,912        331,594        1,649,440        6,040,261        894,921        2,590,551        107,222        16,961,901   
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Total ending allowance balance

   $ 8,841,454      $ 1,266,740      $ 1,767,336      $ 8,458,942      $ 1,663,894      $ 7,891,305      $ 107,222      $ 29,996,893   
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Loans

                

Loans individually evaluated for impairment

   $ 18,840,326      $ 3,172,208      $ 2,512,380      $ 22,317,320      $ 3,196,592      $ 14,439,251      $ —        $ 64,478,077   

Loans collectively evaluated for impairment

     198,872,152        3,093,457        49,708,091        202,063,387        27,472,527        31,429,250        161,989        512,800,853   
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Total ending loans balance

   $ 217,712,478      $ 6,265,665      $ 52,220,471      $ 224,380,707      $ 30,669,119      $ 45,868,501      $ 161,989      $ 577,278,930   
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

The following table presents loans individually evaluated for impairment by class of loans as of June 30, 2012 and the average recorded investment and interest income recognized by class for the twelve months ended June 30, 2012:

 

    June 30, 2012  
     Unpaid
Principal
Balance (1)		     Recorded
Investment		     Allowance
for Loan
Losses
Allocated		     Average
Recorded
Investment		     Interest
Income
Recognized		     Cash Basis
Interest
Recognized		  

With no related allowance recorded

            

One-to-Four Family Loans:

            

1-4 Family Owner Occupied

   $ 6,380,803      $ 5,671,079      $ 0      $ 5,437,834      $ 30,882      $ 30,882   

1-4 Family Non-Owner Occupied

     4,597,708        2,453,581        0        3,503,049        48,828        48,828   

1-4 Family Second Mortgage

     1,455,914        1,230,284        0        1,374,161        3,958        3,958   

Home Equity Lines of Credit

     1,834,685        1,832,595        0        1,344,562        0        0   

Home Equity Investment Lines of Credit

     157,120        156,943        0        204,703        0        0   

One-to-Four Family Construction Loans:

            

1-4 Family Construction

     0        0        0        52,573        4,821        4,821   

1-4 Family Construction Models/Speculative

     678,779        354,986        0        475,027        0        0   

Multi-Family Loans:

            

Multi-Family

     635,053        622,228        0        550,760        4,081        4,081   

Multi-Family Second Mortgage

     0        0        0        0        0        0   

Multi-Family Construction

     0        0        0        0        0        0   

Commercial Real Estate Loans:

            

Commercial

     10,902,253        9,286,678        0        8,005,131        147,148        147,148   

Commercial Second Mortgage

     0        0        0        192,399        1,660        1,660   

Commercial Lines of Credit

     617,240        616,536        0        2,413,942        0        0   

Commercial Construction

     828,490        643,863        0        575,159        0        0   

Commercial and Industrial Loans

     801,075        439,781        0        2,335,961        662        662   

Land Loans:

            

Lot Loans

     5,235,050        3,678,550        0        2,955,360        5,519        5,519   

Acquisition and Development Loans

     5,986,575        3,375,100        0        2,258,295        19,132        19,132   

Consumer Loans

     0        0        0        0        0        0   
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Total with no related allowance recorded

   $ 40,110,745      $ 30,362,204      $ 0      $ 31,678,916      $ 266,691      $ 266,691   
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

With an allowance recorded

            

One-to-Four Family Loans:

            

1-4 Family Owner Occupied

   $ 232,751      $ 232,485      $ 39,981      $ 526,956      $ 0      $ 0   

1-4 Family Non-Owner Occupied

     117,360        117,226        8,286        1,243,154        10,112        10,112   

1-4 Family Second Mortgage

     247,293        247,011        14,685        175,881        0        0   

Home Equity Lines of Credit

     895,875        894,852        299,759        1,629,256        0        0   

Home Equity Investment Lines of Credit

     407,757        407,293        302,322        470,382        0        0   

One-to-Four Family Construction Loans:

            

1-4 Family Construction

     0        0        0        0       

1-4 Family Construction Models/Speculative

     526,363        525,762        101,716        1,064,520        14,047        14,047   

Multi-Family Loans:

            

Multi-Family

     0        0        0        92,056        0        0   

Multi-Family Second Mortgage

     0        0        0        0        0        0   

Multi-Family Construction

     0        0        0        0        0        0   

Commercial Real Estate Loans:

            

Commercial

     1,357,202        1,355,653        98,725        3,796,149        37,340        37,340   

Commercial Second Mortgage

     0        0        0        34,220        0        0   

Commercial Lines of Credit

     0        0        0        48,854        0        0   

Commercial Construction

     0        0        0        711,804        0        0   

Commercial and Industrial Loans

     300,860        300,517        300,860        1,404,807        0        0   

Land Loans:

            

Lot Loans

     135,614        135,459        252,000        962,537        0        0   

Acquisition and Development Loans

     0        0        0        2,397,176        0        0   

Consumer Loans

     0        0        0        0        0        0   
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Total with an allowance recorded

   $ 4,221,075      $ 4,216,258      $ 1,418,334      $ 14,557,752      $ 61,499      $ 61,499   
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Total loans evaluated for impairment

   $ 44,331,820      $ 34,578,462      $ 1,418,334      $ 46,236,668      $ 328,190      $ 328,190   
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

(1)

There are $13.9 million of loans individually identified for impairment accruing interest.

 

The following table presents loans individually evaluated for impairment by class of loans as of June 30, 2011:

 

     June 30, 2011  
    

Unpaid

Principal

Balance (1)

     

Recorded

Investment

     

Allowance

for Loan

Losses

Allocated

  
        
        

With no related allowance recorded

         

One-to-Four Family Loans:

         

1-4 Family Owner Occupied

    $ 7,132,500       $ 7,120,361       $ —     

1-4 Family Non-Owner Occupied

      1,157,145         1,155,176         —     

1-4 Family Second Mortgage

      1,045,287         1,043,508         —     

Home Equity Lines of Credit

      941,437         939,835         —     

Home Equity Investment Lines of Credit

      133,906         133,678         —     

One-to-Four Family Construction Loans:

         

1-4 Family Construction

      —           —           —     

1-4 Family Construction Models/Speculative

      177,211         176,909         —     

Multi-Family Loans:

         

Multi-Family

      2,147,835         2,144,180         —     

Multi-Family Second Mortgage

      —           —           —     

Multi-Family Construction

      —           —           —     

Commercial Real Estate Loans:

         

Commercial

      6,441,158         6,430,196         —     

Commercial Second Mortgage

      571,473         570,500         —     

Commercial Lines of Credit

      2,903,227         2,898,286         —     

Commercial Construction

      370,000         369,370         —     

Commercial and Industrial Loans

      1,561,184         1,558,527         —     

Land Loans:

         

Lot Loans

      965,760         964,116         —     

Acquisition and Development Loans

      439,972         439,224         —     

Consumer Loans

      —           —           —     
  

 

 

     

 

 

     

 

 

  

Total with no related allowance recorded

    $ 25,988,095       $ 25,943,866       $ —     
  

 

 

     

 

 

     

 

 

  

With an allowance recorded

         

One-to-Four Family Loans:

         

1-4 Family Owner Occupied

    $ 688,987       $ 687,815       $ 198,181   

1-4 Family Non-Owner Occupied

      4,885,942         4,877,627         2,024,076   

1-4 Family Second Mortgage

      266,872         266,418         266,872   

Home Equity Lines of Credit

      2,274,632         2,270,761         954,907   

Home Equity Investment Lines of Credit

      345,735         345,147         49,506   

One-to-Four Family Construction Loans:

         

1-4 Family Construction

      —           —           —     

1-4 Family Construction Models/Speculative

      3,000,405         2,995,299         935,146   

Multi-Family Loans:

         

Multi-Family

      368,828         368,200         117,896   

Multi-Family Second Mortgage

      —           —           —     

Multi-Family Construction

      —           —           —     

Commercial Real Estate Loans:

         

Commercial

      8,617,625         8,602,959         1,367,503   

Commercial Second Mortgage

      —           —           —     

Commercial Lines of Credit

      —           —           —     

Commercial Construction

      3,451,883         3,446,009         1,051,178   

Commercial and Industrial Loans

      1,640,858         1,638,065         768,973   

Land Loans:

         

Lot Loans

      2,976,902         2,971,835         867,189   

Acquisition and Development Loans

      10,081,233         10,064,076         4,433,565   

Consumer Loans

      —           —           —     
  

 

 

     

 

 

     

 

 

  

Total with an allowance recorded

    $ 38,599,902       $ 38,534,211       $ 13,034,992   
  

 

 

     

 

 

     

 

 

  

Total loans evaluated for impairment

    $ 64,587,997       $ 64,478,077       $ 13,034,992   
  

 

 

     

 

 

     

 

 

  

 

(1)

There are $14.2 million of loans individually identified for impairment accruing interest.

 

The average recorded investment in impaired loans for the years ended June 30, 2011 and 2010 amounted to $61,642,944 and $52,866,638, respectively. Interest recognized on impaired loans, while considered impaired in 2011 and 2010 was not material.

Past Due and Non-Accrual Loans

The following table presents the recorded investment in nonaccrual loans and loans past due over 90 days still on accrual by class of loans as of June 30, 2012 and 2011. Nonaccrual loans and loans past due over 90 days still on accrual include both smaller balance homogeneous loans that are collectively evaluated for impairment and individually classified impaired loans.

 

     June 30, 2012      June 30, 2011  
     Nonaccrual (1)      Loans Past Due
Over 90 Days
Still Accruing (2)		      Nonaccrual (1)      Loans Past Due
Over 90 Days
Still Accruing (2)		  

One-to-Four Family Loans:

            

1-4 Family Owner Occupied

    $ 2,871,746       $ —         $ 4,456,920       $ —     

1-4 Family Non-Owner Occupied

      2,461,281         —           5,497,907         —     

1-4 Family Second Mortgage

      566,444         —           225,705         —     

Home Equity Lines of Credit

      2,727,447         —           3,061,315         —     

Home Equity Investment Lines of Credit

      564,235         —           478,825         —     

One-to-Four Family Construction Loans:

            

1-4 Family Construction

      0         —           —           —     

1-4 Family Construction Models/Speculative

      355,355         —           2,646,740         —     

Multi-Family Loans:

            

Multi-Family

      324,602         —           2,204,456         —     

Multi-Family Second Mortgage

      0         —           —           —     

Multi-Family Construction

      0         —           —           —     

Commercial Real Estate Loans:

            

Commercial

      3,310,170         —           9,902,065         —     

Commercial Second Mortgage

      0         —           570,500         —     

Commercial Lines of Credit

      616,537         —           1,616,987         —     

Commercial Construction

      644,072         —           3,815,379         —     

Commercial and Industrial Loans

      437,729         —           1,522,402         —     

Land Loans:

            

Lot Loans

      3,815,778         —           3,758,906         —     

Acquisition and Development Loans

      1,380,199         —           10,503,299         —     

Consumer Loans

      0         —           —           —     
  

 

 

     

 

 

     

 

 

     

 

 

  

Total

    $ 20,075,595       $ —         $ 50,261,406       $ —     
  

 

 

     

 

 

     

 

 

     

 

 

  

 

(1)

Nonaccrual status denotes loans on which, in the opinion of management, the collection of additional interest is unlikely, or loans that meet the nonaccrual criteria established by regulatory authorities. Payments received on a nonaccrual loan are either applied to the outstanding principal balance or recorded as interest income, depending on an assessment of the collectability of the principal balance of the loan.
(2)

At June 30, 2012 and 2011, the Company had balances of approximately $6.3 million and $2.3 million, respectively, in loans that have matured and continue to make current payments. These loans are not considered past due as a result of their payment status being current.

 

The following table presents the aging of the recorded investment in past due loans as of June 30, 2012 by class of loan. Performing loans are accruing loans less than 90 days past due. Nonperforming loans are all loans not accruing or greater than 90 days past due and accruing. At June 30, 2012, the Company had a balance of approximately $6.3 million in loans that were contractually past maturity but were not considered past due as a result of the payment status being current.

 

                                     

Performing Loans

   30-59 Days
Past Due		     60-89
Days Past
Due		     Greater
Than 90
Days Past
Due		     Total Past
Due		     Loans Not
Past Due		     Total  

One-to-Four Family Loans:

            

1-4 Family Owner Occupied

   $ 584,430      $ —        $ —        $ 584,430      $ 55,220,719      $ 55,805,149   

1-4 Family Non-Owner Occupied

     375,660        303,667        —          679,327        31,188,492        31,867,819   

1-4 Family Second Mortgage

     14,221        —          —          14,221        28,588,155        28,602,376   

Home Equity Lines of Credit

     114,558        23,230        —          137,788        62,968,449        63,106,237   

Home Equity Investment Lines of Credit

     200,657        —          —          200,657        4,874,516        5,075,173   

One-to-Four Family Construction Loans:

            

1-4 Family Construction

     —          145,771        —          145,771        367,695        513,466   

1-4 Family Construction Models/Speculative

     —          —          —          —          1,250,946        1,250,946   

Multi-Family Loans:

               —     

Multi-Family

     —          —          —          —          53,573,280        53,573,280   

Multi-Family Second Mortgage

     —          —          —          —          145,476        145,476   

Multi-Family Construction

     —          —          —          —          5,368,866        5,368,866   

Commercial Real Estate Loans:

            

Commercial

     744,536        —          —          744,536        194,006,468        194,751,004   

Commercial Second Mortgage

     —          —          —          —          5,743,721        5,743,721   

Commercial Lines of Credit

     —          —          —          —          21,693,593        21,693,593   

Commercial Construction

     —          —          —          —          7,079,839        7,079,839   

Commercial and Industrial Loans

     —          —          —          —          34,965,008        34,965,007   

Land Loans:

            

Lot Loans

     —          —          —          —          8,261,518        8,261,518   

Acquisition and Development Loans

     —          —          —          —          17,691,018        17,691,018   

Consumer Loans

     —          58,394        —          58,394        2,051,903        2,110,297   
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Total Performing Loans

   $ 2,034,062      $ 531,062      $ —        $ 2,565,124      $ 535,039,662      $ 537,604,785   
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Nonperforming Loans

                                    

One-to-Four Family Loans:

            

1-4 Family Owner Occupied

   $ 105,333      $ —        $ 2,124,062      $ 2,229,395      $ 642,351      $ 2,871,746   

1-4 Family Non-Owner Occupied

     —          —          2,405,774        2,405,774        55,507        2,461,281   

1-4 Family Second Mortgage

     —          —          499,154        499,154        67,290        566,444   

Home Equity Lines of Credit

     14,607        —          2,371,962        2,386,569        340,878        2,727,447   

Home Equity Investment Lines of Credit

     —          134,195        430,041        564,236        —          564,236   

One-to-Four Family Construction Loans:

           —            —     

1-4 Family Construction

     —          —          —          —          —          —     

1-4 Family Construction Models/Speculative

     —          —          235,945        235,945        119,410        355,355   

Multi-Family Loans:

           —            —     

Multi-Family

     —          —          324,602        324,602        —          324,602   

Multi-Family Second Mortgage

     —          —          —          —          —          —     

Multi-Family Construction

     —          —          —          —          —          —     

Commercial Real Estate Loans:

           —            —     

Commercial

     —          —          3,166,992        3,166,992        143,178        3,310,170   

Commercial Second Mortgage

     —          —          —          —          —          —     

Commercial Lines of Credit

     —          122,129        494,407        616,536        —          616,536   

Commercial Construction

     —          —          644,072        644,072        —          644,072   

Commercial and Industrial Loans

     —          —          237,957        237,957        199,772        437,729   

Land Loans:

           —            —     

Lot Loans

     —          —          3,144,721        3,144,721        671,057        3,815,778   

Acquisition and Development Loans

     —          —          1,380,199        1,380,199        —          1,380,199   

Consumer Loans

   $ —        $ —          $ —        $ —        $ —     
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Total Nonperforming Loans

     119,940        256,324        17,459,888        17,836,152        2,239,443        20,075,595   
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Total Loans

   $ 2,154,002      $ 787,386      $ 17,459,888      $ 20,401,276      $ 537,279,105      $ 557,680,380   
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

The following table presents the aging of the recorded investment in past due loans as of June 30, 2011 by class of loan. Performing loans are accruing loans less than 90 days past due. Nonperforming loans are all loans not accruing or greater than 90 days past due and accruing. At June 30, 2011, the Company had a balance of approximately $2.3 million in loans that were contractually past maturity but were not considered past due as a result of the payment status being current.

 

Performing Loans

   30-59 Days
Past Due		     60-89
Days Past
Due		     Greater
Than 90
Days Past
Due		     Total Past
Due		     Loans Not
Past Due		     Total  

One-to-Four Family Loans:

            

1-4 Family Owner Occupied

   $ 542,399      $ 288,485      $ —        $ 830,884      $ 60,102,395      $ 60,933,279   

1-4 Family Non-Owner Occupied

     1,435,901        491,638        —          1,927,539        32,211,997        34,139,536   

1-4 Family Second Mortgage

     223,182        492,543        —          715,725        31,900,488        32,616,213   

Home Equity Lines of Credit

     88,971        98,347        —          187,318        68,576,001        68,763,319   

Home Equity Investment Lines of Credit

     82,077        —          —          82,077        7,457,381        7,539,458   

One-to-Four Family Construction Loans:

            

1-4 Family Construction

     —          —          —          —          1,133,853        1,133,853   

1-4 Family Construction Models/Speculative

     —          525,467        —          525,467        1,959,605        2,485,072   

Multi-Family Loans:

            

Multi-Family

     —          —          —          —          48,003,975        48,003,975   

Multi-Family Second Mortgage

     —          —          —          —          420,772        420,772   

Multi-Family Construction

     —          —          —          —          1,591,268        1,591,268   

Commercial Real Estate Loans:

            

Commercial

     1,602,314        270,619        —          1,872,933        183,211,422        185,084,355   

Commercial Second Mortgage

     —          —          —          —          7,602,778        7,602,778   

Commercial Lines of Credit

     1,699,973        —          —          1,699,973        13,674,653        15,374,626   

Commercial Construction

     —          —          —          —          414,018        414,018   

Commercial and Industrial Loans

     422,568        —          —          422,568        28,724,148        29,146,716   

Land Loans:

            

Lot Loans

     1,160,748        135,812        —          1,296,560        17,829,597        19,126,157   

Acquisition and Development Loans

     658,166        159,713        —          817,879        11,662,261        12,480,140   

Consumer Loans

             161,989        161,989   
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Total Performing Loans

   $ 7,916,299      $ 2,462,624      $ —        $ 10,378,923      $ 516,638,601      $ 527,017,524   
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Nonperforming Loans

                                    

One-to-Four Family Loans:

            

1-4 Family Owner Occupied

   $ —        $ 93,565      $ 4,012,589      $ 4,106,154      $ 350,766      $ 4,456,920   

1-4 Family Non-Owner Occupied

     435,800        627,040        4,141,259        5,204,099        293,809        5,497,908   

1-4 Family Second Mortgage

     —          —          141,746        141,746        83,958        225,704   

Home Equity Lines of Credit

     —          195,424        2,721,596        2,917,020        144,295        3,061,315   

Home Equity Investment Lines of Credit

     —          —          386,183        386,183        92,642        478,825   

One-to-Four Family Construction Loans:

            

1-4 Family Construction

     —          —          —          —          —          —     

1-4 Family Construction Models/Speculative

     —          —          2,525,098        2,525,098        121,642        2,646,740   

Multi-Family Loans:

            

Multi-Family

     —          —          2,204,456        2,204,456        —          2,204,456   

Multi-Family Second Mortgage

     —          —          —          —          —          —     

Multi-Family Construction

     —          —          —          —          —          —     

Commercial Real Estate Loans:

            

Commercial

     708,806        1,043,705        7,311,487        9,063,998        838,067        9,902,065   

Commercial Second Mortgage

     —          —          570,500        570,500        —          570,500   

Commercial Lines of Credit

     —          —          1,489,641        1,489,641        127,346        1,616,987   

Commercial Construction

     —          —          3,815,379        3,815,379        —          3,815,379   

Commercial and Industrial Loans

     998,298        —          200,418        1,198,716        323,686        1,522,402   

Land Loans:

            

Lot Loans

     357,415        —          3,401,491        3,758,906        —          3,758,906   

Acquisition and Development Loans

     —          —          8,383,675        8,383,675        2,119,624        10,503,299   

Consumer Loans

     —          —          —          —          —          —     
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Total Nonperforming Loans

     2,500,319        1,959,734        41,305,518        45,765,571        4,495,835        50,261,406   
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Total Loans

   $ 10,416,618      $ 4,422,358      $ 41,305,518      $ 56,144,494      $ 521,134,436      $ 577,278,930   
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

Troubled Debt Restructurings:

Included in loans individually impaired are loans with recorded investment of $15,590,705 and $15,883,869 for which the Company has allocated $153,391 and $443,705 of specific reserves to customers whose terms have been modified in troubled debt restructurings as of June 30, 2012 and 2011, respectively. Included in troubled debt restructurings are $1,805,855 and $3,041,051 of restructured loans on nonaccrual at June 30, 2012 and 2011, respectively. Of the restructured loans, both performing and nonaccrual, two loans totaling $116,065 are not performing in accordance with their modified terms. There are no commitments to lend additional amounts at June 30, 2012 and 2011.

The following table presents the aggregate balance of loans by loan class whose terms have been modified in troubled debt restructurings as of June 30, 2012 and 2011:

 

     Number
of Loans		      Outstanding
Recorded
Investment
6/30/2012		      Number
of Loans		      Outstanding
Recorded
Investment
6/30/2011		  

Troubled Debt Restructurings:

            

One-to-Four Family Loans:

            

1-4 Family Owner Occupied

      19       $ 3,775,715         19       $ 3,706,744   

1-4 Family Non-Owner Occupied

      2         53,993         15         1,355,137   

1-4 Family Second Mortgage

      5         912,147         5         922,159   

Home Equity Lines of Credit

      1         63,782         3         263,241   

Home Equity Investment Lines of Credit

      0         0         0         —     

One-to-Four Family Construction Loans:

            

1-4 Family Construction

      0         0         0         —     

1-4 Family Construction Models/Speculative

      0         0         0         —     

Multi-Family Loans:

            

Multi-Family

      1         297,979         1         308,448   

Multi-Family Second Mortgage

      0         0         0         —     

Multi-Family Construction

      0         0         0         —     

Commercial Real Estate Loans:

            

Commercial

      12         8,264,020         9         7,888,487   

Commercial Second Mortgage

      0         0         0         —     

Commercial Lines of Credit

      0         0         0         —     

Commercial Construction

      0         0         0         —     

Commercial and Industrial Loans

      2         40,696         2         156,169   

Land Loans:

            

Lot Loans

      0         0         0         —     

Acquisition and Development Loans

      2         2,182,373         1         1,283,484   

Consumer Loans

      0         0         0         —     
  

 

 

     

 

 

     

 

 

     

 

 

  

Total

      44       $ 15,590,705         55       $ 15,883,869   
  

 

 

     

 

 

     

 

 

     

 

 

  

 

The summary of activity for troubled debt restructure loans was as follows:

 

     2012  

Troubled Debt Restructurings:

   

Beginning balance

    $ 15,883,869   

Additions

      3,757,042   

Charge-offs

      (1,990,653 ) 

Payoffs or paydowns

      (2,059,553 ) 
  

 

 

  

Ending Balance

    $ 15,590,705   
  

 

 

  

During 2012 and 2011, the terms of certain loans to borrowers experiencing financial difficulty were modified as troubled debt restructurings. The modification of the terms of such loans may include one or a combination of the following: a reduction of the stated interest rate of the loan; an extension of the maturity date at a stated rate of interest lower than the current market rate for new debt with similar risk; or a permanent reduction of the recorded investment in the loan. In order to determine whether a borrower is experiencing financial difficulty, an evaluation is performed of the probability that the borrower will be in payment default on any of its debt in the foreseeable future without the modification. This evaluation is performed under the Company’s internal underwriting policy.

The following table presents loans by class that was modified as troubled debt restructurings at June 30, 2012 and 2011, respectively. All modifications during 2012 involved a reduction of the stated interest rate of the loan and were for periods ranging from 12 months to 24 months, additionally three loans involved a permanent reduction in the recorded investment in the loan totaling approximately $932,000. No maturity dates were extended in these modifications.

 

     June 30, 2012  
            Pre-Modification      Post-Modification  
     Number     

Outstanding

Recorded

     

Outstanding

Recorded

  
     of Loans      Investment      Investment  

Troubled Debt Restructurings:

         

1-4 Family Owner Occupied

      1       $ 234,441       $ 234,441   

1-4 Family Non-Owner Occupied

      1         106,976         106,976   

Commercial Real Estate

      3         2,437,542         1,544,149   

Commercial Second Mortgage

      1         295,362         295,362   

Acquisition and Development

      1         1,037,620         998,890   
  

 

 

     

 

 

     

 

 

  

Total

      7       $ 4,111,941       $ 3,179,818   
  

 

 

     

 

 

     

 

 

  
     June 30, 2011  
     Number
of Loans		      Pre-Modification
Outstanding
Recorded
Investment		      Post-Modification
Outstanding
Recorded
Investment		  

Troubled Debt Restructurings:

         

1-4 Family Owner Occupied

      6       $ 1,663,724       $ 1,663,724   

1-4 Family Non-Owner Occupied

      0         —           —     

Commercial Real Estate

      3         3,073,774         3,073,774   

Commercial Second Mortgage

      5         655,661         655,661   

Acquisition and Development

      1         1,283,484         1,283,484   
  

 

 

     

 

 

     

 

 

  

Total

      15       $ 6,676,643       $ 6,676,643   
  

 

 

     

 

 

     

 

 

  

The troubled debt restructurings resulted in $1.9 million and $0.1 million of charge-offs during the periods ended June 30, 2012 and 2011, respectively of which $1.1 million and $0 were specifically reserved prior to the charge off. As a result the increase in the allowance for loan losses associated with the troubled debt restructuring was $.8 million and $.1 million for the period ended June 30, 2012 and 2011, respectively and included charge off recognized in previous periods.

The following table presents loans by class modified as troubled debt restructurings for which there was a payment default within twelve months following the modification during the period ended June 30, 2012:

 

            Pre-Modification      Post-Modification  
     Number      Outstanding
Recorded		      Outstanding
Recorded		  
     of Loans      Investment      Investment  

Troubled Debt Restructurings:

         

Commercial and Industrial

      2       $ 116,065       $ 116,065   
  

 

 

     

 

 

     

 

 

  

Total

      2       $ 116,065       $ 116,065   
  

 

 

     

 

 

     

 

 

  

For the purpose of this disclosure, a loan is considered to be in payment default once it is 90 days contractually past due under the modified terms.

The troubled debt restructurings that subsequently defaulted did not result in an increase in the allowance for loan losses or result in charge-offs during the periods ended June 30, 2012 and 2011.

Credit Quality Indicators:

The Company categorizes loans into risk strata based on relevant borrower information about the ability to service debt. This information includes a review of current financial information, historic payment experience, credit documentation, relevant public information and other factors, as determined by credit underwriting guidelines. Through its analysis of individual borrowers, the Company classifies each loan as to credit risk. All loans considered non-homogeneous, specifically those that are deemed commercial and industrial or commercial real estate loans, are subject to review by the Company, regardless of loan size. In practice, these loans are reviewed continually and changes to the risk rating, if necessary, occur on a quarterly basis. Loans that are considered homogeneous, or those which fall into the categories of one-to-four family loans or into consumer loans, are not individually rated annually. The payment performance of the homogeneous loans serves as the clear credit indicator of classification into the categories of pass-rated loans or into substandard, nonaccrual loans. Homogeneous loans that are less than 90 days past due are generally reported as pass-rated loans, unless related to a rated commercial and industrial or commercial real estate loan. Homogeneous loans which are greater than 90 days past due are placed on nonaccrual and rated substandard. Payment performance indicators are based on performance through June 30, 2012. The Company uses the following definitions for adverse risk ratings:

Special Mention Loans classified as special mention have a potential weakness that requires close attention. If left unattended, the potential weaknesses may result in further deterioration in the repayment prospects of the loan or of the institution’s credit position at a future date.

Substandard Loans classified as substandard are protected inadequately by the current financial means of the borrower or through the liquidation of collateral pledged. Loans classified as substandard have a well-defined weakness, and without substantial intervention, there is a distinct possibility that the institution may incur a loss. As a matter of practice, if the Bank feels that a total loss is imminent, it designates nearly all of these loans to charge off. Accordingly, the Bank uses the loan classification of doubtful, as defined below, sparingly.

Doubtful Loans classified as doubtful have all of the inherent weaknesses of those loans classified as substandard with the added structural weakness rendering the collection in full highly unlikely. As such, this category is used sparingly by the Bank.

As of June 30, 2012, and based on the most recent analysis performed by the Company, the risk category of loans by class of loans is as follows:

 

            Special                       
     Pass (1)      Mention      Substandard      Doubtful      Total  

One-to-Four Family Loans:

               

1-4 Family Owner Occupied

    $ 55,526,297       $ 0       $ 3,150,598       $ —         $ 58,676,895   

1-4 Family Non-Owner Occupied

      30,621,009         1,117,122         2,590,969         —           34,329,100   

1-4 Family Second Mortgage

      28,147,735         206,701         814,384         —           29,168,820   

Home Equity Lines of Credit

      63,030,206         49,585         2,753,893         —           65,833,684   

Home Equity Investment Lines of Credit

      4,828,651         200,886         609,872         —           5,639,409   

One-to-Four Family Construction Loans:

               

1-4 Family Construction

      513,466         0         0         —           513,466   

1-4 Family Construction Models/Speculative

      724,177         0         882,124         —           1,606,301   

Multi-Family Loans:

               

Multi-Family

      52,448,152         1,124,756         324,974         —           53,897,882   

Multi-Family Second Mortgage

      145,476         0         0         —           145,476   

Multi-Family Construction

      5,368,866         0         0         —           5,368,866   

Commercial Real Estate Loans:

               

Commercial

      183,422,738         3,100,295         11,538,141         —           198,061,174   

Commercial Second Mortgage

      5,743,721         0         0         —           5,743,721   

Commercial Lines of Credit

      19,401,017         0         2,909,112         —           22,310,129   

Commercial Construction

      7,079,104         0         644,807         —           7,723,911   

Commercial and Industrial Loans

      34,042,381         91,634         1,268,721         —           35,402,736   

Land Loans:

               

Lot Loans

      8,217,784         39,374         3,820,138         —           12,077,296   

Acquisition and Development Loans

      16,486,141         0         2,585,076         —           19,071,217   

Consumer Loans

      2,110,297         0         0         —           2,110,297   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total

    $ 517,857,218       $ 5,930,353       $ 33,892,809       $ —         $ 557,680,380   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

 

(1)

There is $2.6 million in non-homogeneous loans which are subject to individual review for risk rating included in the pass risk category based on payment status as they have not yet been individually reviewed.

 

As of June 30, 2011, and based on the most recent analysis performed by the Company, the risk category of loans by class of loan was as follows:

 

            Special                       
     Pass (1)      Mention      Substandard      Doubtful      Total  

One-to-Four Family Loans:

               

1-4 Family Owner Occupied

    $ 59,361,176       $ 949,387       $ 5,079,636       $ —         $ 65,390,199   

1-4 Family Non-Owner Occupied

      33,321,617         78,019         6,237,807         —           39,637,443   

1-4 Family Second Mortgage

      31,936,613         458,096         447,208         —           32,841,917   

Home Equity Lines of Credit

      68,342,138         421,182         3,061,314         —           71,824,634   

Home Equity Investment Lines of Credit

      7,099,224         395,066         523,993         —           8,018,283   

One-to-Four Family Construction Loans:

               

1-4 Family Construction

      1,133,853         —           —           —           1,133,853   

1-4 Family Construction Models/Speculative

      1,684,267         249,575         3,197,969         —           5,131,811   

Multi-Family Loans:

               

Multi-Family

      46,492,916         1,511,059         2,204,456         —           50,208,431   

Multi-Family Second Mortgage

      420,772         —           —           —           420,772   

Multi-Family Construction

      1,591,268         —           —           —           1,591,268   

Commercial Real Estate Loans:

               

Commercial

      171,718,953         7,150,951         16,116,516         —           194,986,420   

Commercial Second Mortgage

      7,602,778         —           570,500         —           8,173,278   

Commercial Lines of Credit

      12,683,879         402,588         3,905,146         —           16,991,613   

Commercial Construction

      414,018         —           3,815,379         —           4,229,397   

Commercial and Industrial Loans

      25,464,753         2,634,968         2,569,399         —           30,669,120   

Land Loans:

               

Lot Loans

      18,091,752         42,077         4,751,234         —           22,885,063   

Acquisition and Development Loans

      9,418,918         2,129,619         11,434,902         —           22,983,439   

Consumer Loans

      161,989         —           —           —           161,989   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total

    $ 496,940,884       $ 16,422,587       $ 63,915,459       $ —         $ 577,278,930   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

 

(1)

There are $9.1 million in non-homogeneous loans which are subject to individual review for risk rating included in the pass risk category based on payment status as they have not yet been individually reviewed.