Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2021 | Apr. 30, 2021 | |
Cover [Abstract] | ||
Entity Registrant Name | PEOPLES BANCORP OF NORTH CAROLINA INC | |
Entity Central Index Key | 0001093672 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2021 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Is Entity's Reporting Status Current? | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Emerging Growth Company | false | |
Entity Small Business | true | |
Entity Shell Company | false | |
Entity Interactive Data Current | Yes | |
Entity Incorporation, State or Country Code | NC | |
Entity File Number | 000-27205 | |
Entity Common Stock, Shares Outstanding | 5,789,166 | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2021 |
Consolidated Balance Sheets (Un
Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Assets | ||
Cash and due from banks, including reserve requirements of $0 at both 3/31/21 and 12/31/20 | $ 43,726 | $ 42,737 |
Interest-bearing deposits | 165,311 | 118,843 |
Cash and cash equivalents | 209,037 | 161,580 |
Investment securities available for sale | 325,517 | 245,249 |
Other investments | 3,791 | 4,155 |
Total securities | 329,308 | 249,404 |
Mortgage loans held for sale | 4,236 | 9,139 |
Loans | 946,497 | 948,639 |
Less allowance for loan losses | (9,532) | (9,908) |
Net loans | 936,965 | 938,731 |
Premises and equipment, net | 18,184 | 18,600 |
Cash surrender value of life insurance | 17,065 | 16,968 |
Other real estate | 128 | 128 |
Right of use lease asset | 3,182 | 3,423 |
Accrued interest receivable and other assets | 19,473 | 18,202 |
Total assets | 1,537,578 | 1,416,175 |
Deposits: | ||
Noninterest-bearing demand | 524,176 | 456,980 |
NOW, MMDA & savings | 701,798 | 657,834 |
Time, $250,000 or more | 28,109 | 25,771 |
Other time | 80,382 | 80,501 |
Total deposits | 1,334,465 | 1,221,086 |
Securities sold under agreements to repurchase | 31,916 | 26,201 |
Junior subordinated debentures | 15,464 | 15,464 |
Lease liability | 3,232 | 3,471 |
Accrued interest payable and other liabilities | 12,472 | 10,054 |
Total liabilities | 1,397,549 | 1,276,276 |
Commitments | ||
Shareholders' equity: | ||
Preferred stock, no par value; authorized 5,000,000 shares; no shares issued and outstanding | 0 | 0 |
Common stock, no par value; authorized 20,000,000 shares; issued and outstanding 5,789,166 shares at March 31, 2021 and 5,787,504 shares at December 31, 2020 | 56,910 | 56,871 |
Common stock held by deferred compensation trust, at cost: 156,808 shares at March 31, 2021 and 155,469 shares at December 31, 2020 | (1,849) | (1,796) |
Deferred compensation | 1,849 | 1,796 |
Retained earnings | 80,819 | 77,628 |
Accumulated other comprehensive income | 2,300 | 5,400 |
Total shareholders' equity | 140,029 | 139,899 |
Total liabilities and shareholders' equity | $ 1,537,578 | $ 1,416,175 |
Consolidated Balance Sheets (_2
Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Assets | ||
Cash and due from banks, reserve requirements | $ 0 | $ 0 |
Shareholders' equity: | ||
Preferred stock, stated value (in dollars per share) | $ 0 | $ 0 |
Preferred stock, shares authorized (in shares) | 5,000,000 | 5,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 20,000,000 | $ 20,000,000 |
Common stock, shares authorized (in shares) | 5,789,166 | 5,787,504 |
Common stock, shares issued (in shares) | 5,789,166 | 5,787,504 |
Common stock, shares outstanding (in shares) | 5,789,166 | 5,787,504 |
Consolidated Statements of Earn
Consolidated Statements of Earnings (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Interest income: | ||
Interest and fees on loans | $ 10,664 | $ 10,680 |
Interest on due from banks | 35 | 43 |
Interest on federal funds sold | 0 | 123 |
Interest on investment securities: | ||
U.S. Government sponsored enterprises | 538 | 685 |
State and political subdivisions | 639 | 641 |
Other | 46 | 78 |
Total interest income | 11,922 | 12,250 |
Interest expense: | ||
Interest-bearing demand, MMDA & savings deposits | 497 | 525 |
Time deposits | 212 | 277 |
FHLB borrowings | 0 | 64 |
Junior subordinated debentures | 71 | 130 |
Other | 35 | 45 |
Total interest expense | 815 | 1,041 |
Net interest income | 11,107 | 11,209 |
Provision for loan losses | (455) | 1,521 |
Net interest income after provision for loan losses | 11,562 | 9,688 |
Non-interest income: | ||
Service charges | 926 | 1,108 |
Other service charges and fees | 212 | 193 |
Mortgage banking income | 870 | 322 |
Insurance and brokerage commissions | 260 | 242 |
Appraisal management fee income | 1,816 | 1,350 |
Miscellaneous | 1,789 | 1,380 |
Total non-interest income | 5,873 | 4,595 |
Non-interest expense: | ||
Salaries and employee benefits | 6,183 | 5,724 |
Occupancy | 1,953 | 1,921 |
Professional fees | 337 | 333 |
Advertising | 143 | 218 |
Debit card expense | 232 | 230 |
Appraisal management fee expense | 1,456 | 1,034 |
Other | 1,964 | 1,989 |
Total non-interest expense | 12,268 | 11,449 |
Earnings before income taxes | 5,167 | 2,834 |
Income tax expense | 1,046 | 467 |
Net earnings | $ 4,121 | $ 2,367 |
Basic net earnings per share | $ .73 | $ .41 |
Diluted net earnings per share | 0.71 | 0.4 |
Cash dividends declared per share | $ 0.16 | $ 0.3 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Statement of Comprehensive Income [Abstract] | ||
Net earnings | $ 4,121 | $ 2,367 |
Other comprehensive income: | ||
Unrealized holding gains on securities available for sale | (4,026) | 2,715 |
Income tax benefit related to other comprehensive income: | ||
Unrealized holding gains on securities available for sale | (926) | 625 |
Total other comprehensive income (loss), net of tax | (3,100) | 2,090 |
Total comprehensive income | $ 1,021 | $ 4,457 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Shareholders' Equity - USD ($) $ in Thousands | Common Stock | Retained Earnings | Deferred compensation | Common Stock Held By Deferred Compensation Trust | Accumulated Other Comprehensive Income | Total |
Beginning balance, shares at Dec. 31, 2019 | 5,912,300 | |||||
Beginning balance, amount at Dec. 31, 2019 | $ 59,813 | $ 70,663 | $ 1,588 | $ (1,588) | $ 3,644 | $ 134,120 |
Common stock repurchase, shares | (126,800) | |||||
Common stock repurchase, amount | $ (2,999) | (2,999) | ||||
Cash dividends declared on common stock | (1,779) | (1,779) | ||||
Restricted stock units exercised, shares | 2,004 | |||||
Restricted stock units exercised, amount | $ 57 | 57 | ||||
Equity incentive plan, net | 64 | (64) | 0 | |||
Net earnings | 2,367 | 2,367 | ||||
Change in accumulated other comprehensive income, net of tax | 2,090 | 2,090 | ||||
Ending balance, shares at Mar. 31, 2020 | 5,787,504 | |||||
Ending balance, amount at Mar. 31, 2020 | $ 56,871 | 71,521 | 1,652 | (1,652) | 5,734 | 133,856 |
Beginning balance, shares at Dec. 31, 2020 | 5,787,504 | |||||
Beginning balance, amount at Dec. 31, 2020 | $ 56,871 | 77,628 | 1,796 | (1,796) | 5,400 | 139,899 |
Cash dividends declared on common stock | (930) | (930) | ||||
Restricted stock units exercised, shares | 1,662 | |||||
Restricted stock units exercised, amount | $ 39 | 39 | ||||
Equity incentive plan, net | 53 | (53) | 0 | |||
Net earnings | 4,121 | 4,121 | ||||
Change in accumulated other comprehensive income, net of tax | (3,100) | (3,100) | ||||
Ending balance, shares at Mar. 31, 2021 | 5,789,166 | |||||
Ending balance, amount at Mar. 31, 2021 | $ 56,910 | $ 80,819 | $ 1,849 | $ (1,849) | $ 2,300 | $ 140,029 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Cash flows from operating activities: | ||
Net earnings | $ 4,121 | $ 2,367 |
Adjustments to reconcile net earnings to net cash provided by operating activities: | ||
Depreciation, amortization and accretion | 1,198 | 1,038 |
Provision for (reduction of provision for) loan losses | (455) | 1,521 |
Deferred income taxes | (9) | (8) |
Restricted stock expense | (44) | (77) |
Proceeds from sales of mortgage loans held for sale | 28,939 | 14,876 |
Origination of mortgage loans held for sale | (24,036) | (16,608) |
Change in: | ||
Cash surrender value of life insurance | (97) | (95) |
Right of use lease asset | 241 | 195 |
Other assets | (336) | 165 |
Lease liability | (239) | (189) |
Other liabilities | 2,432 | (1,298) |
Net cash provided by operating activities | 11,745 | 1,887 |
Cash flows from investing activities: | ||
Purchases of investment securities available for sale | (90,470) | (10,958) |
Proceeds from sales, calls and maturities of investment securities available for sale | 645 | 2,343 |
Proceeds from paydowns of investment securities available for sale | 4,981 | 5,138 |
Proceeds from paydowns on other investments | 44 | 44 |
Redemption (purchase) of FHLB stock | 331 | (3,031) |
Net change in loans | 2,221 | (30,779) |
Purchases of premises and equipment | (243) | (391) |
Net cash used by investing activities | (82,491) | (37,634) |
Cash flows from financing activities: | ||
Net change in deposits | 113,379 | 17,441 |
Net change in securities sold under agreement to repurchase | 5,715 | 4,314 |
Proceeds from FHLB borrowings | 0 | 70,000 |
Proceeds from Fed Funds purchased | 0 | 6,935 |
Repayments of Fed Funds purchased | 0 | (6,935) |
Repayments of Junior Subordinated Debt | 0 | (155) |
Restricted stock units exercised | 39 | 57 |
Common stock repurchased | 0 | (2,999) |
Cash dividends paid on common stock | (930) | (1,779) |
Net cash provided by financing activities | 118,203 | 86,879 |
Net change in cash and cash equivalents | 47,457 | 51,132 |
Cash and cash equivalents at beginning of period | 161,580 | 52,387 |
Cash and cash equivalents at end of period | 209,037 | 103,519 |
Cash paid during the period for: | ||
Interest | 802 | 994 |
Income taxes | 0 | 0 |
Noncash investing and financing activities: | ||
Change in unrealized gain on investment securities available for sale, net | (3,100) | 2,090 |
Issuance of accrued restricted stock units | $ 39 | $ 57 |
1. Summary of Significant Accou
1. Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
1. Summary of Significant Accounting Policies | The consolidated financial statements include the financial statements of Peoples Bancorp of North Carolina, Inc. and its wholly owned subsidiary, Peoples Bank (the “Bank”), along with the Bank’s wholly owned subsidiaries, Peoples Investment Services, Inc. (“PIS”), Real Estate Advisory Services, Inc. (“REAS”), Community Bank Real Estate Solutions, LLC (“CBRES”) and PB Real Estate Holdings, LLC (collectively called the “Company”). All significant intercompany balances and transactions have been eliminated in consolidation. The Bank formerly operated three banking offices focused on the Latino population that were operated as a division of the Bank under the name Banco de la Gente (“Banco”). Two of these offices remain open as Bank branches that offer the same banking services offered in the Bank’s other branches such as the taking of deposits and the making of loans. The consolidated financial statements in this report (other than the Consolidated Balance Sheet at December 31, 2020) are unaudited. In the opinion of management, all adjustments (none of which were other than normal accruals) necessary for a fair presentation of the financial position and results of operations for the periods presented have been included. Management has made a number of estimates and assumptions relating to the reporting of assets and liabilities and the disclosure of contingent assets and liabilities to prepare these consolidated financial statements in conformity with generally accepted accounting principles in the United States (“GAAP”). Actual results could differ from those estimates. The Company’s accounting policies are fundamental to understanding management’s discussion and analysis of results of operations and financial condition. Many of the Company’s accounting policies require significant judgment regarding valuation of assets and liabilities and/or significant interpretation of the specific accounting guidance. A description of the Company’s significant accounting policies can be found in Note 1 of the Notes to Consolidated Financial Statements in the Company’s 2020 Annual Report to Shareholders which is Appendix A to the Proxy Statement for the May 6, 2021 Annual Meeting of Shareholders. Subsequent to issuance of the Company’s December 31, 2020 Form 10-K, it was identified that the Company’s non-qualified deferred compensation plan had not been properly recorded on the Consolidated Balance Sheets. The deferred compensation plan requires all deferral amounts and contributions to be held in a rabbi trust, and the assets held by the trust should be recorded on the Company’s financial statements along with a corresponding liability. For balances related to mutual fund investments held in the trust, the accrued interest receivable and other assets, accrued interest payable and other liabilities, total assets, and total liabilities line items on the Consolidated Balance Sheets were adjusted as of December 31, 2020 to reflect the asset and corresponding liability associated with the portion of the trust held in mutual fund investments. This resulted in an increase to these line items of $1.3 million. Additionally, an adjustment to the presentation of the Company’s shareholders’ equity on the Consolidated Balance Sheets has been made to disclose the number of shares of Company stock held by the trust and the cost basis for those shares, as well as a corresponding liability for the deferred compensation as of December 31, 2020. On the Consolidated Statements of Earnings, basic earnings per share has been adjusted from $0.40 to $0.41 for the three months ended March 31, 2020. The impact of the changes in the fair value of the mutual funds held in the trust and the changes in the deferred compensation liability that were not previously recorded were not considered material to the financial statements. These changes to basic earnings per share are also reflected within Note 4 to the financial statements. In addition to the adjustments to the presentation of the Company’s shareholders' equity on the Consolidated Balance Sheets, the Company adjusted the presentation of the Consolidated Statements of Changes in Shareholders’ Equity for all periods presented to reflect the Company shares held within the plan, as well as the corresponding deferred compensation associated with these shares. The Company’s Consolidated Statements of Cash Flows were adjusted for the three months ended March 31, 2020 in order to reflect the changes to other assets and other liabilities made on the Consolidated Balance Sheets. These unaudited interim financial statements reflect all adjustments that are, in the opinion of management, necessary for a fair statement of the results of the periods presented. All adjustments were not considered material to the financial statements. Revenue Recognition The Company has applied Accounting Standards Update (“ASU”) 2014-09 using a modified retrospective approach. The Company’s revenue is comprised of net interest income and noninterest income. The scope of ASU 2014-09 explicitly excludes net interest income as well as many other revenues for financial assets and liabilities including loans, leases, securities, and derivatives. Accordingly, the majority of the Company’s revenues are not affected. Appraisal management fee income and expense from the Bank’s subsidiary, CBRES, was reported as a net amount prior to March 31, 2018, which was included in miscellaneous non-interest income. This income and expense is now reported on separate line items under non-interest income and non-interest expense. See below for additional information related to revenue generated from contracts with customers. Revenue and Method of Adoption The majority of the Company’s revenue is derived primarily from interest income from receivables (loans) and securities. Other revenues are derived from fees received in connection with deposit accounts, investment advisory, and appraisal services. On January 1, 2018, the Company adopted the requirements of ASU 2014-09. The core principle of the new standard is that a company should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The Company adopted ASU 2014-09 using the modified retrospective transition approach which does not require restatement of prior periods. The method was selected as there were no material changes in the timing of revenue recognition resulting in no comparability issues with prior periods. This adoption method is considered a change in accounting principle requiring additional disclosure of the nature of, and reason for, the change, which is solely a result of the adoption of the required standard. When applying the modified retrospective transition approach under ASU 2014-09, the Company has elected, as a practical expedient, to apply this approach only to contracts that were not completed as of January 1, 2018. A completed contract is considered to be a contract for which all (or substantially all) of the revenue was recognized in accordance with revenue guidance that was in effect before January 1, 2018. There were no uncompleted contracts as of January 1, 2018 for which application of the new standard required an adjustment to retained earnings. The following disclosures involve the Company’s material income streams derived from contracts with customers which are within the scope of ASU 2014-09. Through the Company’s wholly-owned subsidiary, PIS, the Company contracts with a registered investment advisor to perform investment advisory services on behalf of the Company’s customers. The Company receives commissions from this third party investment advisor based on the volume of business that the Company’s customers do with such investment advisor. Total revenue recognized from these contracts was $260,000 and $241,000 for the three months ended March 31, 2021 and 2020, respectively. The Company utilizes third parties to contract with the Company’s customers to perform debit and credit card clearing services. These third parties pay the Company commissions based on the volume of transactions that they process on behalf of the Company’s customers. Total revenue recognized from these contracts with these third parties was $1.2 million and $972,000 for the three months ended March 31, 2021 and 2020, respectively. Through the Company’s wholly-owned subsidiary, REAS, the Company provides property appraisal services for negotiated fee amounts on a per appraisal basis. Total revenue recognized from these contracts with customers was $180,000 and $181,000 for the three months ended March 31, 2021 and 2020, respectively Through the Company’s wholly-owned subsidiary, CBRES, the Company provides appraisal management services. Total revenue recognized from these contracts with customers was $1.8 million and $1.4 million for the three months ended March 31, 2021 and 2020, respectively. Due to the nature of the Company’s relationship with the customers that the Company provides services, the Company does not incur costs to obtain contracts and there are no material incremental costs to fulfill these contracts that should be capitalized. Disaggregation of Revenue Contract Balances Performance Obligations Significant Judgements Recent Accounting Pronouncements The following table provides a summary of ASUs issued by the Financial Accounting Standards Board (“FASB”) that the Company has recently adopted. Recently Adopted Accounting Guidance ASU Description Effective Date Effect on Financial Statements or Other Significant Matters ASU 2019-07: Codification Updates to SEC Sections Guidance updated for various Topics of the ASC to align the guidance in various SEC sections of the ASC with the requirements of certain SEC final rules. Effective upon issuance The adoption of this guidance did not have a material impact on the Company’s results of operations, financial position or disclosures. ASU 2018-13: Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement (Topic 820) Updates the disclosure requirements on fair value measurements in ASC 820, Fair Value Measurement. January 1, 2020 The adoption of this guidance did not have a material impact on the Company’s results of operations, financial position or disclosures. ASU 2018-18: Clarifying the Interaction between Topic 808 and Topic 606 Clarifies the interaction between the guidance for certain collaborative arrangements and the new revenue recognition financial accounting and reporting standard. January 1, 2020 Early adoption permitted The adoption of this guidance did not have a material impact on the Company’s results of operations, financial position or disclosures. ASU 2018-19: Leases (Topic 842): Codification Improvements Provides guidance to address concerns companies had raised about an accounting exception they would lose when assessing the fair value of underlying assets under the leases standard and clarify that lessees and lessors are exempt from a certain interim disclosure requirement associated with adopting the new standard. January 1, 2020 The adoption of this guidance did not have a material impact on the Company’s results of operations, financial position or disclosures. The following table provides a summary of ASU’s issued by the FASB that the Company has not adopted as of March 31, 2021, which may impact the Company’s financial statements. Recently Issued Accounting Guidance Not Yet Adopted ASU Description Effective Date Effect on Financial Statements or Other Significant Matters ASU 2016-13: Measurement of Credit Losses on Financial Instruments Provides guidance to change the accounting for credit losses and modify the impairment model for certain debt securities. See ASU 2019-10 below. The Company will apply this guidance through a cumulative-effect adjustment to retained earnings as of the beginning of the year of adoption. The Company is still evaluating the impact of this guidance on its consolidated financial statements. The Company has formed a Current Expected Credit Losses (“CECL”) committee and implemented a model from a third-party vendor for running CECL calculations. The Company is currently developing CECL model assumptions and comparing results to current allowance for loan loss calculations. The Company plans to run parallel calculations leading up to the effective date of this guidance to ensure it is prepared for implementation by the effective date. In addition to the Company’s allowance for loan losses, it will also record an allowance for credit losses on debt securities instead of applying the impairment model currently utilized. The amount of the adjustments will be impacted by each portfolio’s composition and credit quality at the adoption date as well as economic conditions and forecasts at that time. ASU 2018-14: Disclosure Framework—Changes to the Disclosure Requirements for Defined Benefit Plans (Subtopic 715-20) Updates disclosure requirements for employers that sponsor defined benefit pension or other postretirement plans. January 1, 2021 The adoption of this guidance is not expected to have a material impact on the Company’s results of operations, financial position or disclosures. ASU Description Effective Date Effect on Financial Statements or Other Significant Matters ASU 2018-19: Codification Improvements to Topic 326, Financial Instruments—Credit Losses Aligns the implementation date of the topic for annual financial statements of nonpublic companies with the implementation date for their interim financial statements. The guidance also clarifies that receivables arising from operating leases are not within the scope of the topic, but rather, should be accounted for in accordance with the leases topic. See ASU 2019-10 below. The adoption of this guidance is not expected to have a material impact on the Company’s results of operations, financial position or disclosures. See ASU 2016-13 above. ASU 2019-04: Codification Improvements to Topic 326, Financial Instruments—Credit Losses, Topic 815, Derivatives and Hedging, and Topic 825, Financial Instruments Addresses unintended issues accountants flagged when implementing ASU 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities, ASU 2016-13, Measurement of Credit Losses on Financial Instruments, and ASU 2017-12, Targeted Improvements to Accounting for Hedging Activities. See ASU 2019-10 below. The adoption of this guidance is not expected to have a material impact on the Company’s results of operations, financial position or disclosures. See ASU 2016-13 above. ASU 2019-05: Financial Instruments—Credit Losses (Topic 326): Targeted Transition Relief Guidance to provide entities with an option to irrevocably elect the fair value option, applied on an instrument-by-instrument basis for eligible instruments, upon adoption of ASU 2016-13, Measurement of Credit Losses on Financial Instruments. See ASU 2019-10 below. The adoption of this guidance is not expected to have a material impact on the Company’s results of operations, financial position or disclosures. See ASU 2016-13 above. ASU 2019-10: Financial Instruments—Credit Losses (Topic 326), Derivatives and Hedging (Topic 815), and Leases (Topic 842): Effective Dates Guidance to defer the effective dates for private companies, not-for-profit organizations, and certain smaller reporting companies applying standards on current expected credit losses (CECL), leases, hedging. January 1, 2023 The adoption of this guidance is not expected to have a material impact on the Company’s results of operations, financial position or disclosures. ASU 2019-11: Codification Improvements to Topic 326, Financial Instruments—Credit Losses Guidance that addresses issues raised by stakeholders during the implementation of ASU 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. The amendments affect a variety of Topics in the ASC. January 1, 2023 The adoption of this guidance is not expected to have a material impact on the Company’s results of operations, financial position or disclosures. ASU 2019-12: Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes Guidance to simplify accounting for income taxes by removing specific technical exceptions that often produce information investors have a hard time understanding. The amendments also improve consistent application of and simplify GAAP for other areas of Topic 740 by clarifying and amending existing guidance. January 1, 2021 The adoption of this guidance is not expected to have a material impact on the Company’s results of operations, financial position or disclosures. ASU 2020-01: Investments—Equity Securities (Topic 321), Investments—Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815)—Clarifying the Interactions between Topic 321, Topic 323, and Topic 815 (a consensus of the FASB Emerging Issues Task Force) Guidance to clarify the interaction of the accounting for equity securities under Topic 321 and investments accounted for under the equity method of accounting in Topic 323 and the accounting for certain forward contracts and purchased options accounted for under Topic 815. January 1, 2021 The adoption of this guidance is not expected to have a material impact on the Company’s results of operations, financial position or disclosures. ASU Description Effective Date Effect on Financial Statements or Other Significant Matters ASU 2020-02: Financial Instruments—Credit Losses (Topic 326) and Leases (Topic 842)—Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 119 and Update to SEC Section on Effective Date Related to Accounting Standards Update No. 2016-02, Leases (Topic 842) (SEC Update) Guidance to add and amend SEC paragraphs in the Accounting Standards Codification to reflect the issuance of SEC Staff Accounting Bulletin No. 119 related to the new credit losses standard and comments by the SEC staff related to the revised effective date of the new leases standard. Effective upon issuance The adoption of this guidance is not expected to have a material impact on the Company’s results of operations, financial position or disclosures. ASU 2020-03: Codification Improvements to Financial Instruments Guidance to clarify that the contractual term of a net investment in a lease, determined in accordance with the leases standard, should be the contractual term used to measure expected credit losses under ASC 326. January 1, 2023 The adoption of this guidance is not expected to have a material impact on the Company’s results of operations, financial position or disclosures. ASU 2020-04: Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting Guidance that provides optional expedients and exceptions for applying GAAP to contract modifications and hedging relationships, subject to meeting certain criteria, that reference LIBOR or another reference rate expected to be discontinued. The ASU is intended to help stakeholders during the global market-wide reference rate transition period. Therefore, it will be in effect for a limited time through December 31, 2022. March 12, 2020 through December 31, 2022 The adoption of this guidance is not expected to have a material impact on the Company’s results of operations, financial position or disclosures. ASU 2020-06: Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity Guidance to improve financial reporting associated with accounting for convertible instruments and contracts in an entity’s own equity. January 1, 2022 The adoption of this guidance is not expected to have a material impact on the Company’s results of operations, financial position or disclosures. Other accounting standards that have been issued or proposed by FASB or other standards-setting bodies are not expected to have a material impact on the Company’s results of operations, financial position or disclosures. Reclassification Certain amounts in the 2020 consolidated financial statements have been reclassified to conform to the 2021 presentation. |
2. Investment Securities
2. Investment Securities | 3 Months Ended |
Mar. 31, 2021 | |
Investments, Debt and Equity Securities [Abstract] | |
2. Investment Securities | Investment securities available for sale at March 31, 2021 and December 31, 2020 are as follows: (Dollars in thousands) March 31, 2021 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value U.S Treasuries $ 7,960 7,960 U.S. Government sponsored enterprises 12,939 282 202 13,019 Mortgage-backed securities 184,445 2,225 967 185,703 State and political subdivisions 117,186 3,070 1,421 118,835 Total $ 322,530 5,577 2,590 325,517 (Dollars in thousands) December 31, 2020 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value U.S. Government sponsored enterprises $ 7,384 331 208 7,507 Mortgage-backed securities 143,095 2,812 593 145,314 State and political subdivisions 87,757 4,758 87 92,428 Total $ 238,236 7,901 888 245,249 The current fair value and associated unrealized losses on investments in securities with unrealized losses at March 31, 2021 and December 31, 2020 are summarized in the tables below, with the length of time the individual securities have been in a continuous loss position. (Dollars in thousands) March 31, 2021 Less than 12 Months 12 Months or More Total Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses U.S. Government sponsored enterprises $ 4,098 202 4,098 202 Mortgage-backed securities 82,322 947 1,979 20 84,301 967 State and political subdivisions 38,420 1,421 38,420 1,421 Total $ 120,742 2,368 6,077 222 126,819 2,590 (Dollars in thousands) December 31, 2020 Less than 12 Months 12 Months or More Total Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses U.S. Government sponsored enterprises $ 4,193 208 4,193 208 Mortgage-backed securities 80,827 565 4,762 28 85,589 593 State and political subdivisions 7,126 87 7,126 87 Total $ 87,953 652 8,955 236 96,908 888 At March 31, 2021, unrealized losses in the investment securities portfolio relating to debt securities totaled $2.6 million. The unrealized losses on these debt securities arose due to changing interest rates and are considered to be temporary. From the March 31, 2021 tables above, 33 out of 111 securities issued by state and political subdivisions and 30 out of 83 securities issued by U.S. Government sponsored enterprises contained unrealized losses. These unrealized losses are considered temporary because of acceptable financial condition and results of operations of entities that issued each security and the repayment sources of principal and interest on U.S. Government sponsored enterprises, including mortgage-backed securities, are government backed. The amortized cost and estimated fair value of investment securities available for sale at March 31, 2021, by contractual maturity, are shown below. Expected maturities of mortgage-backed securities will differ from contractual maturities because borrowers have the right to call or prepay obligations with or without call or prepayment penalties. March 31, 2021 (Dollars in thousands) Amortized Cost Estimated Fair Value Due within one year $ 15,906 16,126 Due from one to five years 10,216 10,785 Due from five to ten years 87,596 89,027 Due after ten years 24,367 23,876 Mortgage-backed securities 184,445 185,703 Total $ 322,530 325,517 No securities available for sale were sold during the three months ended March 31, 2021 and 2020. Securities with a fair value of approximately $76.6 million and $77.3 million at March 31, 2021 and December 31, 2020, respectively, were pledged to secure public deposits and for other purposes as required by law. |
3. Loans
3. Loans | 3 Months Ended |
Mar. 31, 2021 | |
Receivables [Abstract] | |
3. Loans | Major classifications of loans at March 31, 2021 and December 31, 2020 are summarized as follows: (Dollars in thousands) March 31, 2021 December 31, 2020 Real estate loans: Construction and land development $ 87,878 94,124 Single-family residential 264,356 272,325 Single-family residential - Banco de la Gente non-traditional 26,278 26,883 Commercial 337,943 332,971 Multifamily and farmland 57,914 48,880 Total real estate loans 774,369 775,183 Loans not secured by real estate: Commercial loans 160,892 161,740 Farm loans 860 855 Consumer loans 6,778 7,113 All other loans 3,598 3,748 Total loans 946,497 948,639 Less allowance for loan losses 9,532 9,908 Total net loans $ 936,965 938,731 The Bank grants loans and extensions of credit primarily within the Catawba Valley region of North Carolina, which encompasses Catawba, Alexander, Iredell and Lincoln counties, and also in Mecklenburg, Wake and Durham counties of North Carolina. Although the Bank has a diversified loan portfolio, a substantial portion of the loan portfolio is collateralized by improved and unimproved real estate, the value of which is dependent upon the real estate market. Risk characteristics of the major components of the Bank’s loan portfolio are discussed below: ● Construction and land development loans – The risk of loss is largely dependent on the initial estimate of whether the property’s value at completion equals or exceeds the cost of property construction and the availability of take-out financing. During the construction phase, a number of factors can result in delays or cost overruns. If the estimate is inaccurate or if actual construction costs exceed estimates, the value of the property securing the loan may be insufficient to ensure full repayment when completed through a permanent loan, sale of the property, or by seizure of collateral. As of March 31, 2021, construction and land development loans comprised approximately 9% of the Bank’s total loan portfolio. ● Single-family residential loans – Declining home sales volumes, decreased real estate values and higher than normal levels of unemployment could contribute to losses on these loans. As of March 31, 2021, single-family residential loans comprised approximately 31% of the Bank’s total loan portfolio, and include Banco’s non-traditional single-family residential loans, which were approximately 3% of the Bank’s total loan portfolio. ● Commercial real estate loans – Repayment is dependent on income being generated in amounts sufficient to cover operating expenses and debt service. These loans also involve greater risk because they are generally not fully amortizing over a loan period, but rather have a balloon payment due at maturity. A borrower’s ability to make a balloon payment typically will depend on being able to either refinance the loan or timely sell the underlying property. As of March 31, 2021, commercial real estate loans comprised approximately 36% of the Bank’s total loan portfolio. ● Commercial loans – Repayment is generally dependent upon the successful operation of the borrower’s business. In addition, the collateral securing the loans may depreciate over time, be difficult to appraise, be illiquid or fluctuate in value based on the success of the business. As of March 31, 2021, commercial loans comprised approximately 17% of the Bank’s total loan portfolio, including $78.2 million in Small Business Administration (“SBA”) Paycheck Protection Program (“PPP”) loans. Loans are considered past due if the required principal and interest payments have not been received as of the date such payments were due. Loans are placed on non-accrual status when, in management’s opinion, the borrower may be unable to meet payment obligations as they become due, as well as when required by regulatory provisions. Loans may be placed on non-accrual status regardless of whether or not such loans are considered past due. When interest accrual is discontinued, all unpaid accrued interest is reversed. Interest income is subsequently recognized only to the extent cash payments are received in excess of principal due. Loans are returned to accrual status when all of the principal and interest amounts contractually due are brought current and future payments are reasonably assured. The following tables present an age analysis of past due loans, by loan type, as of March 31, 2021 and December 31, 2020: March 31, 2021 (Dollars in thousands) Loans 30-89 Days Past Due Loans 90 or More Days Past Due Total Past Due Loans Total Current Loans Total Loans Accruing Loans 90 or More Days Past Due Real estate loans: Construction and land development $ 434 434 87,444 87,878 Single-family residential 2,314 67 2,381 261,975 264,356 Single-family residential - Banco de la Gente non-traditional 2,709 48 2,757 23,521 26,278 Commercial 713 713 337,230 337,943 Multifamily and farmland 57,914 57,914 Total real estate loans 6,170 115 6,285 768,084 774,369 Loans not secured by real estate: Commercial loans 144 144 160,748 160,892 Farm loans 860 860 Consumer loans 33 2 35 6,743 6,778 All other loans 3,598 3,598 Total loans $ 6,347 117 6,464 940,033 946,497 December 31, 2020 (Dollars in thousands) Loans 30-89 Days Past Due Loans 90 or More Days Past Due Total Past Due Loans Total Current Loans Total Loans Accruing Loans 90 or More Days Past Due Real estate loans: Construction and land development $ 298 298 93,826 94,124 Single-family residential 3,660 270 3,930 268,395 272,325 Single-family residential - Banco de la Gente non-traditional 3,566 105 3,671 23,212 26,883 Commercial 36 36 332,935 332,971 Multifamily and farmland 48,880 48,880 Total real estate loans 7,560 375 7,935 767,248 775,183 Loans not secured by real estate: Commercial loans 161,740 161,740 Farm loans 855 855 Consumer loans 45 2 47 7,066 7,113 All other loans 3,748 3,748 Total loans $ 7,605 377 7,982 940,657 948,639 The following table presents non-accrual loans as of March 31, 2021 and December 31, 2020: (Dollars in thousands) March 31, 2021 December 31, 2020 Real estate loans: Single-family residential $ 1,207 1,266 Single-family residential - Banco de la Gente non-traditional 1,665 1,709 Commercial 429 440 Multifamily and farmland 115 117 Total real estate loans 3,416 3,532 Loans not secured by real estate: Commercial loans 141 212 Consumer loans 9 14 Total $ 3,566 3,758 At each reporting period, the Bank determines which loans are impaired. Accordingly, the Bank’s impaired loans are reported at their estimated fair value on a non-recurring basis. An allowance for each impaired loan that is collateral-dependent is calculated based on the fair value of its collateral. The fair value of the collateral is based on appraisals performed by REAS, a subsidiary of the Bank. REAS is staffed by certified appraisers that also perform appraisals for other companies. Factors, including the assumptions and techniques utilized by the appraiser, are considered by management. If the recorded investment in the impaired loan exceeds the measure of fair value of the collateral, a valuation allowance is recorded as a component of the allowance for loan losses. An allowance for each impaired loan that is not collateral dependent is calculated based on the present value of projected cash flows. If the recorded investment in the impaired loan exceeds the present value of projected cash flows, a valuation allowance is recorded as a component of the allowance for loan losses. Impaired loans under $250,000 are not individually evaluated for impairment with the exception of the Bank’s troubled debt restructured (“TDR”) loans in the residential mortgage loan portfolio, which are individually evaluated for impairment. Accruing impaired loans were $20.6 million, $21.3 million and $22.8 million at March 31, 2021, December 31, 2020 and March 31, 2020, respectively. Interest income recognized on accruing impaired loans was $283,000, $1.2 million, and $329,000 for the three months ended March 31, 2021, the year ended December 31, 2020 and the three months ended March 31, 2020, respectively. No interest income is recognized on non-accrual impaired loans subsequent to their classification as non-accrual. The following table presents impaired loans as of March 31, 2021: March 31, 2021 (Dollars in thousands) Unpaid Contractual Principal Balance Recorded Investment With No Allowance Recorded Investment With Allowance Recorded Investment in Impaired Loans Related Allowance Average Outstanding Impaired Loans YTD Interest Income Recognized Real estate loans: Construction and land development $ 104 104 104 4 106 2 Single-family residential 4,837 278 4,248 4,526 30 5,490 60 Single-family residential - Banco de la Gente non-traditional 13,162 12,575 12,575 843 11,832 177 Commercial 2,966 1,071 1,865 2,936 14 2,955 36 Multifamily and farmland 118 115 115 116 1 Total impaired real estate loans 21,187 1,349 18,907 20,256 891 20,499 276 Loans not secured by real estate: Commercial loans 430 141 231 372 4 413 6 Consumer loans 24 19 19 28 1 Total impaired loans $ 21,641 1,490 19,157 20,647 895 20,940 283 The following table presents impaired loans as of and for the year ended December 31, 2020: December 31, 2020 (Dollars in thousands) Unpaid Contractual Principal Balance Recorded Investment With No Allowance Recorded Investment With Allowance Recorded Investment in Impaired Loans Related Allowance Average Outstanding Impaired Loans YTD Interest Income Recognized Real estate loans: Construction and land development $ 108 108 108 4 134 8 Single-family residential 5,302 379 4,466 4,845 33 4,741 262 Single-family residential - Banco de la Gente non-traditional 13,417 12,753 12,753 862 13,380 798 Commercial 2,999 1,082 1,891 2,973 14 2,940 139 Multifamily and farmland 119 117 117 29 6 Total impaired real estate loans 21,945 1,461 19,335 20,796 913 21,224 1,213 Loans not secured by real estate: Commercial loans 515 211 244 455 5 564 32 Consumer loans 41 37 37 1 60 5 Total impaired loans $ 22,501 1,672 19,616 21,288 919 21,848 1,250 Impaired loans collectively evaluated for impairment totaled $5.8 million and $6.1 million at March 31, 2021 and 2020, respectively. The following tables present changes in the allowance for loan losses for the three months ended March 31, 2021 and 2020. PPP loans are excluded from the allowance for loan losses as PPP loans are 100 percent guaranteed by the SBA. (Dollars in thousands) Real Estate Loans Construction and Land Development Single-Family Residential Single-Family Residential - Banco de la Gente non-traditional Commercial Multifamily and Farmland Commercial Farm Consumer and All Other Unallocated Total Three months ended March 31, 2021 Allowance for loan losses: Beginning balance $ 1,196 1,843 1,052 2,212 122 1,345 128 2,010 9,908 Charge-offs (85 ) (85 ) Recoveries 50 60 12 3 39 164 Provision (185 ) (53 ) (19 ) 28 23 (104 ) 9 (154 ) (455 ) Ending balance $ 1,061 1,850 1,033 2,252 145 1,244 91 1,856 9,532 Allowance for loan losses March 31, 2021 Ending balance: individually evaluated for impairment $ 2 4 826 8 840 Ending balance: collectively evaluated for impairment 1,059 1,846 207 2,244 145 1,244 91 1,856 8,692 Ending balance $ 1,061 1,850 1,033 2,252 145 1,244 91 1,856 9,532 Loans March 31, 2021: Ending balance $ 87,878 264,356 26,278 337,943 57,914 160,892 860 10,376 946,497 Ending balance: individually evaluated for impairment $ 7 1,444 11,193 2,098 141 14,883 Ending balance: collectively evaluated for impairment $ 87,871 262,912 15,085 335,845 57,914 160,751 860 10,376 931,614 (Dollars in thousands) Real Estate Loans Construction and Land Development Single-Family Residential Single-Family Residential - Banco de la Gente non-traditional Commercial Multifamily and Farmland Commercial Farm Consumer and All Other Unallocated Total Three months ended March 31, 2020 Allowance for loan losses: Beginning balance $ 694 1,274 1,073 1,305 120 688 138 1,388 6,680 Charge-offs (5 ) (7 ) (31 ) (167 ) (210 ) Recoveries 2 16 23 25 55 121 Provision 602 423 11 478 (2 ) 335 154 (480 ) 1,521 Ending balance $ 1,293 1,713 1,084 1,799 118 1,017 180 908 8,112 Allowance for loan losses March 31, 2020 Ending balance: individually evaluated for impairment $ 2 6 906 9 29 952 Ending balance: collectively evaluated for impairment 1,291 1,707 178 1,790 118 988 180 908 7,160 Ending balance $ 1,293 1,713 1,084 1,799 118 1,017 180 908 8,112 Loans March 31, 2020: Ending balance $ 105,939 271,489 29,887 301,490 48,191 104,221 1,044 18,303 880,564 Ending balance: individually evaluated for impairment $ 8 1,678 12,489 2,095 344 16,614 Ending balance: collectively evaluated for impairment $ 105,931 269,811 17,398 299,395 48,191 103,877 1,044 18,303 863,950 The provision for loan losses for the three months ended March 31, 2021 was a credit of $455,000, compared to an expense of $1.5 million for the three months ended March 31, 2020. The decrease in the provision for loan losses is primarily attributable to a decrease in reserves on loans with payment modifications made as a result of the COVID-19 pandemic and a decrease in reserves due to generally flat volumes of loans in the general reserve pools. At March 31, 2021, the balance of loans with existing modifications as a result of COVID-19 was $1.9 million, of which $602,000 represents the balance of loans under the terms of a first modification and $1.3 million represents the balance of outstanding loans under the terms of a second or third modification. At December 31, 2020, the balance of loans with existing modifications as a result of COVID-19 was $18.3 million. The Company continues to track all loans that are currently modified or have been modified as a result of COVID-19. At March 31, 2021, the balance for all loans that are currently modified or previously modified but have returned to their original terms was $114.8 million. The loan balances associated with COVID-19 related modifications have been grouped into their own pool within the Company’s Allowance for Loan and Lease Losses (“ALLL”) model as they have a higher likelihood of risk, and a higher reserve rate has been applied to that pool. Of all loans modified as a result of COVID-19, $112.9 million have returned to their original terms; however, the effects of stimulus in the current environment are still unknown, and additional losses may be present in loans that are currently modified and/or loans that were once modified. These payment modifications are primarily interest only payments for three to nine months. Loans with COVID-19 related payment modifications that have reverted to their original terms are still included with reserves associated with COVID-19 payment modifications at March 31, 2021. There is still uncertainty about the ongoing and future effects of national and local policy decisions on these borrowers that could still limit their ability to adhere to their original payment terms. At December 31, 2020, the balance for all loans that were then currently modified or previously modified but returned to their original terms was $119.6 million. Loan payment modifications associated with the COVID-19 pandemic are not classified as TDR due to Section 4013 of the Coronavirus Aid, Relief and Economic Security Act (the “CARES Act”), which provides that a qualified loan modification is exempt by law from classification as a TDR pursuant to GAAP. The Company utilizes an internal risk grading matrix to assign a risk grade to each of its loans. Loans are graded on a scale of 1 to 8. These risk grades are evaluated on an ongoing basis. A description of the general characteristics of the eight risk grades is as follows: ● Risk Grade 1 – Excellent Quality: Loans are well above average quality and a minimal amount of credit risk exists. Certificates of deposit or cash secured loans or properly margined actively traded stock or bond secured loans would fall in this grade. ● Risk Grade 2 – High Quality: Loans are of good quality with risk levels well within the Company’s range of acceptability. The organization or individual is established with a history of successful performance though somewhat susceptible to economic changes. ● Risk Grade 3 – Good Quality: Loans of average quality with risk levels within the Company’s range of acceptability but higher than normal. This may be a new organization or an existing organization in a transitional phase (e.g. expansion, acquisition, market change). ● Risk Grade 4 – Management Attention: These loans have higher risk and servicing needs but still are acceptable. Evidence of marginal performance or deteriorating trends is observed. These are not problem credits presently, but may be in the future if the borrower is unable to change its present course. ● Risk Grade 5 – Watch: These loans are currently performing satisfactorily, but there has been some recent past due history on repayment and there are potential weaknesses that may, if not corrected, weaken the asset or inadequately protect the Company’s position at some future date. ● Risk Grade 6 – Substandard: A Substandard loan is inadequately protected by the current sound net worth and paying capacity of the obligor or the collateral pledged (if there is any). There is a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. There is a distinct possibility that the Company will sustain some loss if the deficiencies are not corrected. ● Risk Grade 7 – Doubtful: Loans classified as Doubtful have all the weaknesses inherent in loans classified as Substandard, plus the added characteristic that the weaknesses make collection or liquidation in full on the basis of currently existing facts, conditions, and values highly questionable and improbable. Doubtful is a temporary grade where a loss is expected but is presently not quantified with any degree of accuracy. Once the loss position is determined, the amount is charged off. ● Risk Grade 8 – Loss: Loans classified as Loss are considered uncollectable and of such little value that their continuance as bankable assets is not warranted. This classification does not mean that the asset has absolutely no recovery or salvage value, but rather that it is not practical or desirable to defer writing off this worthless loan even though partial recovery may be realized in the future. Loss is a temporary grade until the appropriate authority is obtained to charge the loan off. The following tables present the credit risk profile of each loan type based on internally assigned risk grades as of March 31, 2021 and December 31, 2020: March 31, 2021 (Dollars in thousands) Real Estate Loans Construction and Land Development Single-Family Residential Single-Family Residential - Banco de la Gente non-traditional Commercial Multifamily and Farmland Commercial Farm Consumer All Other Total 1- Excellent Quality $ 5,196 436 701 6,333 2- High Quality 10,147 113,727 39,402 20 16,955 2,150 1,486 183,887 3- Good Quality 71,651 119,255 9,856 249,646 54,014 132,296 839 3,540 1,420 642,517 4- Management Attention 3,413 19,477 11,998 37,337 3,196 8,761 21 345 692 85,240 5- Watch 2,586 3,633 1,883 10,684 569 2,248 5 21,608 6- Substandard 81 3,068 2,541 874 115 196 37 6,912 7- Doubtful 8- Loss Total $ 87,878 264,356 26,278 337,943 57,914 160,892 860 6,778 3,598 946,497 December 31, 2020 (Dollars in thousands) Real Estate Loans Construction and Land Development Single-Family Residential Single-Family Residential - Banco de la Gente non-traditional Commercial Multifamily and Farmland Commercial Farm Consumer All Other Total 1- Excellent Quality $ 228 9,867 406 678 11,179 2- High Quality 9,092 121,331 40,569 22 19,187 2,237 1,563 194,001 3- Good Quality 76,897 115,109 10,170 241,273 44,890 128,727 832 3,826 1,477 623,201 4- Management Attention 4,917 20,012 12,312 39,370 3,274 11,571 23 336 708 92,523 5- Watch 2,906 2,947 1,901 10,871 694 1,583 6 20,908 6- Substandard 84 3,059 2,500 888 266 30 6,827 7- Doubtful 8- Loss Total $ 94,124 272,325 26,883 332,971 48,880 161,740 855 7,113 3,748 948,639 Current year TDR modifications, past due TDR loans and non-accrual TDR loans totaled $3.4 million and $3.8 million at March 31, 2021 and December 31, 2020, respectively. The terms of these loans have been renegotiated to provide a concession to original terms, including a reduction in principal or interest as a result of the deteriorating financial position of the borrower. There were no performing loans classified as TDR loans at March 31, 2021 and December 31, 2020. There were no new TDR modifications during the three months ended March 31, 2021 and 2020. There were no loans modified as TDR that defaulted during the three months ended March 31, 2021 and 2020, which were within 12 months of their modification date. Generally, a TDR loan is considered to be in default once it becomes 90 days or more past due following a modification. On March 27, 2020, President Trump signed the CARES Act, which established a $2 trillion economic stimulus package, including cash payments to individuals, supplemental unemployment insurance benefits and a $349 billion loan program administered through the PPP. Under the PPP, small businesses, sole proprietorships, independent contractors and self-employed individuals may apply for loans from existing SBA lenders and other approved regulated lenders that enroll in the program, subject to numerous limitations and eligibility criteria. A second round of PPP funding, signed into law by President Trump on April 24, 2020, provided $320 billion additional funding for the PPP. The Bank is participating as a lender in the PPP. Total PPP loans originated as of March 31, 2021 amounted to $124.8 million. The outstanding balance of PPP loans was $78.2 million at March 31, 2021. The Bank has received $5.1 million in fees from the SBA for PPP loans originated as of March 31, 2021. The Bank has recognized PPP loan fee income totaling $2.4 million, including $999,000 PPP fee income recognized during the three months ended March 31, 2021. |
4. Net Earnings Per Share
4. Net Earnings Per Share | 3 Months Ended |
Mar. 31, 2021 | |
Earnings Per Share [Abstract] | |
4. Net Earnings Per Share | Net earnings per share is based on the weighted average number of shares outstanding during the period while the effects of potential shares outstanding during the period are included in diluted earnings per share. The average market price during the applicable period is used to compute equivalent shares. The reconciliation of the amounts used in the computation of both “basic earnings per share” and “diluted earnings per share” for the three months ended March 31, 2021 and 2020 is as follows: For the three months ended March 31, 2021 Net Earnings (Dollars in thousands) Weighted Average Number of Shares Per Share Amount Basic earnings per share $ 4,121 5,631,414 $ 0.73 Effect of dilutive securities: Restricted stock units 12,169 Shares held in deferred comp plan 156,662 Diluted earnings per share $ 4,121 5,800,245 $ 0.71 For the three months ended March 31, 2020 Net Earnings (Dollars in thousands) Weighted Average Number of Shares Per Share Amount Basic earnings per share $ 2,367 5,723,540 $ 0.41 Effect of dilutive securities: Restricted stock units 13,440 Shares held in deferred comp plan 146,938 Diluted earnings per share $ 2,367 5,883,378 $ 0.40 |
5. Stock-Based Compensation
5. Stock-Based Compensation | 3 Months Ended |
Mar. 31, 2021 | |
Share-based Payment Arrangement [Abstract] | |
5. Stock-Based Compensation | The Company has an Omnibus Stock Ownership and Long Term Incentive Plan that was approved by shareholders on May 7, 2009 (the “2009 Plan”) whereby certain stock-based rights, such as stock options, restricted stock, restricted stock units, performance units, stock appreciation rights or book value shares, may be granted to eligible directors and employees. The 2009 Plan expired on May 7, 2019 but still governs the rights and obligations of the parties for grants made thereunder. As of March 31, 2021, there were no outstanding shares reserved for possible issuance under the 2009 Plan. The Company granted 16,583 restricted stock units under the 2009 Plan at a grant date fair value of $16.34 per share during the first quarter of 2015. The Company granted 5,544 restricted stock units under the 2009 Plan at a grant date fair value of $16.91 per share during the first quarter of 2016. The Company granted 4,114 restricted stock units under the 2009 Plan at a grant date fair value of $25.00 per share during the first quarter of 2017. The Company granted 3,725 restricted stock units under the 2009 Plan at a grant date fair value of $31.43 per share during the first quarter of 2018. The Company granted 5,290 restricted stock units under the 2009 Plan at a grant date fair value of $28.43 per share during the first quarter of 2019. The number of restricted stock units granted and grant date fair values for the restricted stock units granted in 2015 through 2017 have been restated to reflect the 10% stock dividend that was paid in the fourth quarter of 2017. The Company recognizes compensation expense on the restricted stock units over the period of time the restrictions are in place (four years from the grant date for the 2015, 2016, 2017, 2018 and 2019 grants). The amount of expense recorded each period reflects the changes in the Company’s stock price during such period. As of March 31, 2021, the total unrecognized compensation expense related to the restricted stock unit grants under the 2009 Plan was $74,000. The Company also has an Omnibus Stock Ownership and Long Term Incentive Plan that was approved by shareholders on May 7, 2020 (the “2020 Plan”) whereby certain stock-based rights, such as stock options, restricted stock, restricted stock units, performance units, stock appreciation rights or book value shares, may be granted to eligible directors and employees. A total of 300,000 shares were reserved for possible issuance under the 2020 Plan when it was adopted. As of March 31, 2021, a total of 285,075 shares are reserved for future issuance under the 2020 Plan. All stock-based rights under the 2020 Plan must be granted or awarded by May 7, 2030 (or ten years from the 2020 Plan effective date). The Company granted 7,635 restricted stock units under the 2020 Plan at a grant date fair value of $17.08 per share during the second quarter of 2020. The Company granted 7,290 restricted stock units under the 2020 Plan at a grant date fair value of $22.04 per share during the first quarter of 2021. The Company recognizes compensation expense on the restricted stock units over the period of time the restrictions are in place (four years from the grant date for 2020 and 2021 grants). As of March 31, 2021, the total unrecognized compensation expense related to the restricted stock unit grants under the 2020 Plan was $304,000. The Company recognized compensation expense for restricted stock unit awards granted under the 2009 Plan and 2020 Plan of $44,000 for the three months ended March 31, 2021. The Company recognized a $77,000 credit to compensation expense for restricted stock unit awards granted under the 2009 Plan for the three months ended March 31, 2020 due to a reduction in the Company’s stock price from $32.85 per share at December 31, 2019, compared to $20.36 per share at March 31, 2020. |
6. Fair Value
6. Fair Value | 3 Months Ended |
Mar. 31, 2021 | |
Fair Value Disclosures [Abstract] | |
6. Fair Value | The Company is required to disclose fair value information about financial instruments, whether or not recognized on the face of the balance sheet, for which it is practicable to estimate that value. The assumptions used in the estimation of the fair value of the Company’s financial instruments are detailed below. Where quoted prices are not available, fair values are based on estimates using discounted cash flows and other valuation techniques. The use of discounted cash flows can be significantly affected by the assumptions used, including the discount rate and estimates of future cash flows. The following disclosures should not be considered a surrogate of the liquidation value of the Company, but rather a good faith estimate of the increase or decrease in the value of financial instruments held by the Company since purchase, origination or issuance. The methods of determining the fair value of assets and liabilities presented in this note are consistent with methodologies disclosed in Note 16 of the Company’s 2020 Form 10-K, except for the valuation of loans which was impacted by the adoption of ASU No. 2016-01. The Company groups assets and liabilities at fair value in three levels, based on the markets in which the assets and liabilities are traded and the reliability of the assumptions used to determine fair value. These levels are: ● Level 1 – Valuation is based upon quoted prices for identical instruments traded in active markets. ● Level 2 – Valuation is based upon quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-based valuation techniques for which all significant assumptions are observable in the market. ● Level 3 – Valuation is generated from model-based techniques that use at least one significant assumption not observable in the market. These unobservable assumptions reflect estimates of assumptions that market participants would use in pricing the asset or liability. Valuation techniques include use of option pricing models, discounted cash flow models and similar techniques. Cash and Cash Equivalents For cash, due from banks and interest-bearing deposits, the carrying amount is a reasonable estimate of fair value. Cash and cash equivalents are reported in the Level 1 fair value category. Investment Securities Available for Sale Fair values of investment securities available for sale are determined by obtaining quoted prices on nationally recognized securities exchanges when available. If quoted prices are not available, fair value is determined using matrix pricing, which is a mathematical technique used widely in the industry to value debt securities without relying exclusively on quoted prices for the specific securities but rather by relying on the securities’ relationship to other benchmark quoted securities. Fair values for investment securities with quoted market prices are reported in the Level 1 fair value category. Fair value measurements obtained from independent pricing services are reported in the Level 2 fair value category. All other fair value measurements are reported in the Level 3 fair value category. Other Investments For other investments, the carrying value is a reasonable estimate of fair value. Other investments are reported in the Level 3 fair value category. Mortgage Loans Held for Sale Mortgage loans held for sale are carried at the lower of aggregate cost or market value. The cost of mortgage loans held for sale approximates the market value. Mortgage loans held for sale are reported in the Level 3 fair value category. Loans In accordance with ASU No. 2016-01, the fair value of loans, excluding previously presented impaired loans measured at fair value on a non-recurring basis, is estimated using discounted cash flow analyses. The discount rates used to determine fair value use interest rate spreads that reflect factors such as liquidity, credit, and nonperformance risk of the loans. Loans are reported in the Level 3 fair value category, as the pricing of loans is more subjective than the pricing of other financial instruments. Mutual Funds For mutual funds held in the deferred compensation trust, the carrying value is a reasonable estimate of fair value. Mutual funds held in the deferred compensation trust are included in other assets on balance sheet and reported in the Level 2 fair value category. Deposits The fair value of demand deposits, interest-bearing demand deposits and savings is the amount payable on demand at the reporting date. The fair value of certificates of deposit is estimated by discounting the future cash flows using the rates currently offered for deposits of similar remaining maturities. Deposits are reported in the Level 3 fair value category. Securities Sold Under Agreements to Repurchase For securities sold under agreements to repurchase, the carrying value is a reasonable estimate of fair value. Securities sold under agreements to repurchase are reported in the Level 2 fair value category. FHLB Borrowings The fair value of FHLB borrowings is estimated based upon discounted future cash flows using a discount rate comparable to the current market rate for such borrowings. FHLB borrowings are reported in the Level 3 fair value category. Junior Subordinated Debentures Because the Company’s junior subordinated debentures were issued at a floating rate, the carrying amount is a reasonable estimate of fair value. Junior subordinated debentures are reported in the Level 2 fair value category. Commitments to Extend Credit and Standby Letters of Credit Commitments to extend credit and standby letters of credit are generally short-term and at variable interest rates. Therefore, both the carrying value and estimated fair value associated with these instruments are immaterial. Limitations Fair value estimates are made at a specific point in time, based on relevant market information and information about the financial instrument. These estimates do not reflect any premium or discount that could result from offering for sale at one time the Company’s entire holdings of a particular financial instrument. Because no market exists for a significant portion of the Company’s financial instruments, fair value estimates are based on many judgments. These estimates are subjective in nature and involve uncertainties and matters of significant judgment and therefore cannot be determined with precision. Changes in assumptions could significantly affect the estimates. Fair value estimates are based on existing on and off-balance sheet financial instruments without attempting to estimate the value of anticipated future business and the value of assets and liabilities that are not considered financial instruments. Significant assets and liabilities that are not considered financial instruments include deferred income taxes and premises and equipment. In addition, the tax ramifications related to the realization of unrealized gains and losses can have a significant effect on fair value estimates and have not been considered in the estimates. The tables below present the balance of securities available for sale, which are measured at fair value on a recurring basis by level within the fair value hierarchy, as of March 31, 2021 and December 31, 2020. (Dollars in thousands) March 31, 2021 Fair Value Measurements Level 1 Valuation Level 2 Valuation Level 3 Valuation U. S Treasuries $ 7,960 $ 7,960 U.S. Government sponsored enterprises 13,019 13,019 Mortgage-backed securities 185,703 185,703 State and political subdivisions 118,835 118,835 (Dollars in thousands) December 31, 2020 Fair Value Measurements Level 1 Valuation Level 2 Valuation Level 3 Valuation U.S. Government sponsored enterprises $ 7,507 7,507 Mortgage-backed securities 145,314 145,314 State and political subdivisions 92,428 92,428 The tables below present the balance of mutual funds held in the deferred compensation trust, which are measured at fair value on a recurring basis by level within the fair value hierarchy, as of March 31, 2021 and December 31, 2020. (Dollars in thousands) March 31, 2021 Fair Value Measurements Level 1 Valuation Level 2 Valuation Level 3 Valuation Mutual funds held in deferred compensation trust $ 1,372 - 1,372 - (Dollars in thousands) December 31, 2020 Fair Value Measurements Level 1 Valuation Level 2 Valuation Level 3 Valuation Mutual funds held in deferred compensation trust $ 1,320 - 1,320 - The fair value measurements for mortgage loans held for sale, impaired loans and other real estate on a non-recurring basis at March 31, 2021 and December 31, 2020 are presented below. The fair value measurement process uses certified appraisals and other market-based information; however, in many cases, it also requires significant input based on management’s knowledge of, and judgment about, current market conditions, specific issues relating to the collateral and other matters. As a result, all fair value measurements for impaired loans and other real estate are considered Level 3. Fair Value Measurements March 31, 2021 Level 1 Valuation Level 2 Valuation Level 3 Valuation Mortgage loans held for sale $ 4,236 4,236 Impaired loans 19,752 19,752 Other real estate 128 128 (Dollars in thousands) Fair Value Measurements December 31, 2020 Level 1 Valuation Level 2 Valuation Level 3 Valuation Mortgage loans held for sale $ 9,139 9,139 Impaired loans 20,369 20,369 Other real estate 128 128 (Dollars in thousands) Fair Value March 31, 2021 Fair Value December 31, 2020 Valuation Technique Significant Unobservable Inputs General Range of Significant Unobservable Input Values Mortgage loans held for sale $ 4,236 9,139 Rate lock commitment N/A N/A Impaired loans 19,752 20,369 Appraised value and discounted cash flows Discounts to reflect current market conditions and ultimate collectability 0 - 25 % Other real estate 128 128 Appraised value Discounts to reflect current market conditions and estimated costs to sell 0 - 25 % The carrying amount and estimated fair value of financial instruments at March 31, 2021 and December 31, 2020 are as follows: (Dollars in thousands) Fair Value Measurements at March 31, 2021 Carrying Amount Level 1 Level 2 Level 3 Total Assets: Cash and cash equivalents $ 209,037 209,037 209,037 Investment securities available for sale 325,517 325,517 325,517 Other investments 3,791 3,791 3,791 Mortgage loans held for sale 4,236 4,236 4,236 Loans, net 936,965 921,096 921,096 Mutual funds held in deferred compensation trust 1,372 1,372 1,372 Liabilities: Deposits $ 1,334,465 1,330,015 1,330,015 Securities sold under agreements to repurchase 31,916 31,916 31,916 Junior subordinated debentures 15,464 15,464 15,464 Fair Value Measurements at December 31, 2020 Carrying Amount Level 1 Level 2 Level 3 Total Assets: Cash and cash equivalents $ 161,580 161,580 - - 161,580 Investment securities available for sale 245,249 - 245,249 - 245,249 Other investments 4,155 - - 4,155 4,155 Mortgage loans held for sale 9,139 - - 9,139 9,139 Loans, net 938,731 - - 924,845 924,845 Mutual funds held in deferred compensation trust 1,320 - 1,320 - 1,320 Liabilities: Deposits $ 1,221,086 - - 1,216,503 1,216,503 Securities sold under agreements to repurchase 26,201 - 26,201 - 26,201 Junior subordinated debentures 15,464 - 15,464 - 15,464 |
7. Leases
7. Leases | 3 Months Ended |
Mar. 31, 2021 | |
Leases [Abstract] | |
7. Leases | As of March 31, 2021, the Company had operating ROU assets of $3.2 million and operating lease liabilities of $3.2 million. The Company maintains operating leases on land and buildings for some of the Bank’s branch facilities and loan production offices. Most leases include one option to renew, with renewal terms extending up to 15 years. The exercise of renewal options is based on the judgment of management as to whether or not the renewal option is reasonably certain to be exercised. Factors in determining whether an option is reasonably certain of exercise include, but are not limited to, the value of leasehold improvements, the value of renewal rates compared to market rates, and the presence of factors that would cause a significant economic penalty to the Company if the option is not exercised. As allowed by ASU 2016-02, leases with a term of 12 months or less are not recorded on the balance sheet and instead are recognized in lease expense on a straight-line basis over the lease term. The following table presents lease cost and other lease information as of March 31, 2021 and 2020. (Dollars in thousands) March 31, 2021 March 31, 2020 Operating lease cost $ $ 195 224 Other information: Cash paid for amounts included in the measurement of lease liabilities 189 218 Operating cash flows from operating leases Right-of-use assets obtained in exchange for new lease liabilities - operating leases Weighted-average remaining lease term - operating leases 6.95 7.20 Weighted-average discount rate - operating leases 2.69 % 3.20 % The following table presents lease maturities as of March 31, 2021 and December 31, 2020. (Dollars in thousands) Maturity Analysis of Operating Lease Liabilities: March 31, 2021 December 31, 2020 2021 $ 537 $ 754 2022 550 588 2023 544 567 2024 489 489 2025 433 433 Thereafter 1,041 1,041 Total 3,594 3,872 Less: Imputed Interest (362 ) (401 ) Operating Lease Liability $ 3,232 $ 3,471 |
8. Subsequent Events
8. Subsequent Events | 3 Months Ended |
Mar. 31, 2021 | |
Subsequent Events [Abstract] | |
8. Subsequent Events | The Company has reviewed and evaluated subsequent events and transactions for material subsequent events through the date the financial statements are issued. The Bank has continued to originate PPP loans. PPP loans originated in April 2021 totaled $2.7 million. The outstanding balance of PPP loans was $65.5 million at April 30, 2021, as compared to $78.2 million at March 31, 2021. The decrease from March 31, 2021 to April 30, 2021 was primarily due to PPP loans being forgiven by the SBA. |
2. Investment Securities (Table
2. Investment Securities (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Investments, Debt and Equity Securities [Abstract] | |
Investment securities available for sale | March 31, 2021 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value U.S Treasuries $ 7,960 7,960 U.S. Government sponsored enterprises 12,939 282 202 13,019 Mortgage-backed securities 184,445 2,225 967 185,703 State and political subdivisions 117,186 3,070 1,421 118,835 Total $ 322,530 5,577 2,590 325,517 (Dollars in thousands) December 31, 2020 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value U.S. Government sponsored enterprises $ 7,384 331 208 7,507 Mortgage-backed securities 143,095 2,812 593 145,314 State and political subdivisions 87,757 4,758 87 92,428 Total $ 238,236 7,901 888 245,249 |
Current fair value and associated unrealized losses on investments in securities with unrealized losses | March 31, 2021 Less than 12 Months 12 Months or More Total Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses U.S. Government sponsored enterprises $ 4,098 202 4,098 202 Mortgage-backed securities 82,322 947 1,979 20 84,301 967 State and political subdivisions 38,420 1,421 38,420 1,421 Total $ 120,742 2,368 6,077 222 126,819 2,590 (Dollars in thousands) December 31, 2020 Less than 12 Months 12 Months or More Total Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses U.S. Government sponsored enterprises $ 4,193 208 4,193 208 Mortgage-backed securities 80,827 565 4,762 28 85,589 593 State and political subdivisions 7,126 87 7,126 87 Total $ 87,953 652 8,955 236 96,908 888 |
Amortized cost and estimated fair value of investment securities available for sale by contractual maturity | Amortized Cost Estimated Fair Value Due within one year $ 15,906 16,126 Due from one to five years 10,216 10,785 Due from five to ten years 87,596 89,027 Due after ten years 24,367 23,876 Mortgage-backed securities 184,445 185,703 Total $ 322,530 325,517 |
3. Loans (Tables)
3. Loans (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Receivables [Abstract] | |
Major classifications of loans | March 31, 2021 December 31, 2020 Real estate loans: Construction and land development $ 87,878 94,124 Single-family residential 264,356 272,325 Single-family residential - Banco de la Gente non-traditional 26,278 26,883 Commercial 337,943 332,971 Multifamily and farmland 57,914 48,880 Total real estate loans 774,369 775,183 Loans not secured by real estate: Commercial loans 160,892 161,740 Farm loans 860 855 Consumer loans 6,778 7,113 All other loans 3,598 3,748 Total loans 946,497 948,639 Less allowance for loan losses 9,532 9,908 Total net loans $ 936,965 938,731 |
Age analysis of past due loans, by loan type | March 31, 2021 (Dollars in thousands) Loans 30-89 Days Past Due Loans 90 or More Days Past Due Total Past Due Loans Total Current Loans Total Loans Accruing Loans 90 or More Days Past Due Real estate loans: Construction and land development $ 434 434 87,444 87,878 Single-family residential 2,314 67 2,381 261,975 264,356 Single-family residential - Banco de la Gente non-traditional 2,709 48 2,757 23,521 26,278 Commercial 713 713 337,230 337,943 Multifamily and farmland 57,914 57,914 Total real estate loans 6,170 115 6,285 768,084 774,369 Loans not secured by real estate: Commercial loans 144 144 160,748 160,892 Farm loans 860 860 Consumer loans 33 2 35 6,743 6,778 All other loans 3,598 3,598 Total loans $ 6,347 117 6,464 940,033 946,497 December 31, 2020 (Dollars in thousands) Loans 30-89 Days Past Due Loans 90 or More Days Past Due Total Past Due Loans Total Current Loans Total Loans Accruing Loans 90 or More Days Past Due Real estate loans: Construction and land development $ 298 298 93,826 94,124 Single-family residential 3,660 270 3,930 268,395 272,325 Single-family residential - Banco de la Gente non-traditional 3,566 105 3,671 23,212 26,883 Commercial 36 36 332,935 332,971 Multifamily and farmland 48,880 48,880 Total real estate loans 7,560 375 7,935 767,248 775,183 Loans not secured by real estate: Commercial loans 161,740 161,740 Farm loans 855 855 Consumer loans 45 2 47 7,066 7,113 All other loans 3,748 3,748 Total loans $ 7,605 377 7,982 940,657 948,639 |
Non-accrual loans | March 31, 2021 December 31, 2020 Real estate loans: Single-family residential $ 1,207 1,266 Single-family residential - Banco de la Gente non-traditional 1,665 1,709 Commercial 429 440 Multifamily and farmland 115 117 Total real estate loans 3,416 3,532 Loans not secured by real estate: Commercial loans 141 212 Consumer loans 9 14 Total $ 3,566 3,758 |
Impaired loans | March 31, 2021 (Dollars in thousands) Unpaid Contractual Principal Balance Recorded Investment With No Allowance Recorded Investment With Allowance Recorded Investment in Impaired Loans Related Allowance Average Outstanding Impaired Loans YTD Interest Income Recognized Real estate loans: Construction and land development $ 104 104 104 4 106 2 Single-family residential 4,837 278 4,248 4,526 30 5,490 60 Single-family residential - Banco de la Gente non-traditional 13,162 12,575 12,575 843 11,832 177 Commercial 2,966 1,071 1,865 2,936 14 2,955 36 Multifamily and farmland 118 115 115 116 1 Total impaired real estate loans 21,187 1,349 18,907 20,256 891 20,499 276 Loans not secured by real estate: Commercial loans 430 141 231 372 4 413 6 Consumer loans 24 19 19 28 1 Total impaired loans $ 21,641 1,490 19,157 20,647 895 20,940 283 The following table presents impaired loans as of and for the year ended December 31, 2020: December 31, 2020 (Dollars in thousands) Unpaid Contractual Principal Balance Recorded Investment With No Allowance Recorded Investment With Allowance Recorded Investment in Impaired Loans Related Allowance Average Outstanding Impaired Loans YTD Interest Income Recognized Real estate loans: Construction and land development $ 108 108 108 4 134 8 Single-family residential 5,302 379 4,466 4,845 33 4,741 262 Single-family residential - Banco de la Gente non-traditional 13,417 12,753 12,753 862 13,380 798 Commercial 2,999 1,082 1,891 2,973 14 2,940 139 Multifamily and farmland 119 117 117 29 6 Total impaired real estate loans 21,945 1,461 19,335 20,796 913 21,224 1,213 Loans not secured by real estate: Commercial loans 515 211 244 455 5 564 32 Consumer loans 41 37 37 1 60 5 Total impaired loans $ 22,501 1,672 19,616 21,288 919 21,848 1,250 |
Changes in the allowance for loan losses | Real Estate Loans Construction and Land Development Single-Family Residential Single-Family Residential - Banco de la Gente non-traditional Commercial Multifamily and Farmland Commercial Farm Consumer and All Other Unallocated Total Three months ended March 31, 2021 Allowance for loan losses: Beginning balance $ 1,196 1,843 1,052 2,212 122 1,345 128 2,010 9,908 Charge-offs (85 ) (85 ) Recoveries 50 60 12 3 39 164 Provision (185 ) (53 ) (19 ) 28 23 (104 ) 9 (154 ) (455 ) Ending balance $ 1,061 1,850 1,033 2,252 145 1,244 91 1,856 9,532 Allowance for loan losses March 31, 2021 Ending balance: individually evaluated for impairment $ 2 4 826 8 840 Ending balance: collectively evaluated for impairment 1,059 1,846 207 2,244 145 1,244 91 1,856 8,692 Ending balance $ 1,061 1,850 1,033 2,252 145 1,244 91 1,856 9,532 Loans March 31, 2021: Ending balance $ 87,878 264,356 26,278 337,943 57,914 160,892 860 10,376 946,497 Ending balance: individually evaluated for impairment $ 7 1,444 11,193 2,098 141 14,883 Ending balance: collectively evaluated for impairment $ 87,871 262,912 15,085 335,845 57,914 160,751 860 10,376 931,614 (Dollars in thousands) Real Estate Loans Construction and Land Development Single-Family Residential Single-Family Residential - Banco de la Gente non-traditional Commercial Multifamily and Farmland Commercial Farm Consumer and All Other Unallocated Total Three months ended March 31, 2020 Allowance for loan losses: Beginning balance $ 694 1,274 1,073 1,305 120 688 138 1,388 6,680 Charge-offs (5 ) (7 ) (31 ) (167 ) (210 ) Recoveries 2 16 23 25 55 121 Provision 602 423 11 478 (2 ) 335 154 (480 ) 1,521 Ending balance $ 1,293 1,713 1,084 1,799 118 1,017 180 908 8,112 Allowance for loan losses March 31, 2020 Ending balance: individually evaluated for impairment $ 2 6 906 9 29 952 Ending balance: collectively evaluated for impairment 1,291 1,707 178 1,790 118 988 180 908 7,160 Ending balance $ 1,293 1,713 1,084 1,799 118 1,017 180 908 8,112 Loans March 31, 2020: Ending balance $ 105,939 271,489 29,887 301,490 48,191 104,221 1,044 18,303 880,564 Ending balance: individually evaluated for impairment $ 8 1,678 12,489 2,095 344 16,614 Ending balance: collectively evaluated for impairment $ 105,931 269,811 17,398 299,395 48,191 103,877 1,044 18,303 863,950 |
Credit risk profile of each loan type based on internally assigned risk grade | March 31, 2021 (Dollars in thousands) Real Estate Loans Construction and Land Development Single-Family Residential Single-Family Residential - Banco de la Gente non-traditional Commercial Multifamily and Farmland Commercial Farm Consumer All Other Total 1- Excellent Quality $ 5,196 436 701 6,333 2- High Quality 10,147 113,727 39,402 20 16,955 2,150 1,486 183,887 3- Good Quality 71,651 119,255 9,856 249,646 54,014 132,296 839 3,540 1,420 642,517 4- Management Attention 3,413 19,477 11,998 37,337 3,196 8,761 21 345 692 85,240 5- Watch 2,586 3,633 1,883 10,684 569 2,248 5 21,608 6- Substandard 81 3,068 2,541 874 115 196 37 6,912 7- Doubtful 8- Loss Total $ 87,878 264,356 26,278 337,943 57,914 160,892 860 6,778 3,598 946,497 December 31, 2020 (Dollars in thousands) Real Estate Loans Construction and Land Development Single-Family Residential Single-Family Residential - Banco de la Gente non-traditional Commercial Multifamily and Farmland Commercial Farm Consumer All Other Total 1- Excellent Quality $ 228 9,867 406 678 11,179 2- High Quality 9,092 121,331 40,569 22 19,187 2,237 1,563 194,001 3- Good Quality 76,897 115,109 10,170 241,273 44,890 128,727 832 3,826 1,477 623,201 4- Management Attention 4,917 20,012 12,312 39,370 3,274 11,571 23 336 708 92,523 5- Watch 2,906 2,947 1,901 10,871 694 1,583 6 20,908 6- Substandard 84 3,059 2,500 888 266 30 6,827 7- Doubtful 8- Loss Total $ 94,124 272,325 26,883 332,971 48,880 161,740 855 7,113 3,748 948,639 |
4. Net Earnings Per Share (Tabl
4. Net Earnings Per Share (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Earnings Per Share [Abstract] | |
Reconciliations of the amounts used in the computation of both basic earnings per common share and diluted earnings per common share | For the three months ended March 31, 2021 Net Earnings (Dollars in thousands) Weighted Average Number of Shares Per Share Amount Basic earnings per share $ 4,121 5,631,414 $ 0.73 Effect of dilutive securities: Restricted stock units — 12,169 Shares held in deferred comp plan — 156,662 Diluted earnings per share $ 4,121 5,800,245 $ 0.71 For the three months ended March 31, 2020 Net Earnings (Dollars in thousands) Weighted Average Number of Shares Per Share Amount Basic earnings per share $ 2,367 5,723,540 $ 0.41 Effect of dilutive securities: Restricted stock units — 13,440 Shares held in deferred comp plan — 146,938 Diluted earnings per share $ 2,367 5,883,378 $ 0.40 |
6. Fair Value (Tables)
6. Fair Value (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Fair Value Disclosures [Abstract] | |
Available for sale securities measured at fair value on a recurring basis | (Dollars in thousands) March 31, 2021 Fair Value Measurements Level 1 Valuation Level 2 Valuation Level 3 Valuation U. S Treasuries $ 7,960 $ 7,960 U.S. Government sponsored enterprises 13,019 13,019 Mortgage-backed securities 185,703 185,703 State and political subdivisions 118,835 118,835 (Dollars in thousands) December 31, 2020 Fair Value Measurements Level 1 Valuation Level 2 Valuation Level 3 Valuation U.S. Government sponsored enterprises $ 7,507 7,507 Mortgage-backed securities 145,314 145,314 State and political subdivisions 92,428 92,428 (Dollars in thousands) March 31, 2021 Fair Value Measurements Level 1 Valuation Level 2 Valuation Level 3 Valuation Mutual funds held in deferred compensation trust $ 1,372 - 1,372 - (Dollars in thousands) December 31, 2020 Fair Value Measurements Level 1 Valuation Level 2 Valuation Level 3 Valuation Mutual funds held in deferred compensation trust $ 1,320 - 1,320 - |
Fair value measurements of investment securities available for sale using Level 3 significant unobservable inputs | Fair Value Measurements March 31, 2021 Level 1 Valuation Level 2 Valuation Level 3 Valuation Mortgage loans held for sale $ 4,236 4,236 Impaired loans 19,752 19,752 Other real estate 128 128 (Dollars in thousands) Fair Value Measurements December 31, 2020 Level 1 Valuation Level 2 Valuation Level 3 Valuation Mortgage loans held for sale $ 9,139 9,139 Impaired loans $ 20,369 20,369 Other real estate $ 128 128 (Dollars in thousands) Fair Value March 31, 2021 Fair Value December 31, 2020 Valuation Technique Significant Unobservable Inputs General Range of Significant Unobservable Input Values Mortgage loans held for sale $ 4,236 9,139 Rate lock commitment N/A N/A Impaired loans 19,752 20,369 Appraised value and discounted cash flows Discounts to reflect current market conditions and ultimate collectability 0 - 25 % Other real estate 128 128 Appraised value Discounts to reflect current market conditions and estimated costs to sell 0 - 25 % |
Carrying amount and estimated fair value of the Company's financial instruments | (Dollars in thousands) Fair Value Measurements at March 31, 2021 Carrying Amount Level 1 Level 2 Level 3 Total Assets: Cash and cash equivalents $ 209,037 209,037 - - 209,037 Investment securities available for sale 325,517 - 325,517 - 325,517 Other investments 3,791 - - 3,791 3,791 Mortgage loans held for sale 4,236 - - 4,236 4,236 Loans, net 936,965 - - 921,096 921,096 Mutual funds held in deferred compensation trust 1,372 - 1,372 - 1,372 Liabilities: Deposits $ 1,334,465 - - 1,330,015 1,330,015 Securities sold under agreements to repurchase 31,916 - 31,916 - 31,916 Junior subordinated debentures 15,464 - 15,464 - 15,464 (Dollars in thousands) Fair Value Measurements at December 31, 2020 Carrying Amount Level 1 Level 2 Level 3 Total Assets: Cash and cash equivalents $ 161,580 161,580 - - 161,580 Investment securities available for sale 245,249 - 245,249 - 245,249 Other investments 4,155 - - 4,155 4,155 Mortgage loans held for sale 9,139 - - 9,139 9,139 Loans, net 938,731 - - 924,845 924,845 Mutual funds held in deferred compensation trust 1,320 - 1,320 - 1,320 Liabilities: Deposits $ 1,221,086 - - 1,216,503 1,216,503 Securities sold under agreements to repurchase 26,201 - 26,201 - 26,201 Junior subordinated debentures 15,464 - 15,464 - 15,464 |
7. Leases (Tables)
7. Leases (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Leases [Abstract] | |
Lease expense | (Dollars in thousands) March 31, 2021 March 31, 2020 Operating lease cost $ $ 195 224 Other information: Cash paid for amounts included in the measurement of lease liabilities 189 218 Operating cash flows from operating leases Right-of-use assets obtained in exchange for new lease liabilities - operating leases Weighted-average remaining lease term - operating leases 6.95 7.20 Weighted-average discount rate - operating leases 2.69 % 3.20 % |
Maturity analysis of operating lease liabilities | (Dollars in thousands) Maturity Analysis of Operating Lease Liabilities: March 31, 2021 December 31, 2020 2021 $ 537 $ 754 2022 550 588 2023 544 567 2024 489 489 2025 433 433 Thereafter 1,041 1,041 Total 3,594 3,872 Less: Imputed Interest (362 ) (401 ) Operating Lease Liability $ 3,232 $ 3,471 |
2. Investment Securities (Detai
2. Investment Securities (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021 | Dec. 31, 2020 | |
Investment Securities Available for Sale | ||
Amortized cost | $ 322,530 | $ 238,236 |
Estimated fair value | 325,517 | 245,249 |
U.S. Treasuries | ||
Investment Securities Available for Sale | ||
Amortized cost | 7,960 | 0 |
Gross unrealized gains | 0 | 0 |
Gross unrealized losses | 0 | 0 |
Estimated fair value | 7,960 | 0 |
U.S. Government Sponsored Enterprises | ||
Investment Securities Available for Sale | ||
Amortized cost | 12,939 | 7,384 |
Gross unrealized gains | 282 | 331 |
Gross unrealized losses | 202 | 208 |
Estimated fair value | 13,019 | 7,507 |
Mortgage-Backed Securities | ||
Investment Securities Available for Sale | ||
Amortized cost | 184,445 | 143,095 |
Gross unrealized gains | 2,225 | 2,812 |
Gross unrealized losses | 967 | 593 |
Estimated fair value | 185,703 | 145,314 |
State and Political Subdivisions | ||
Investment Securities Available for Sale | ||
Amortized cost | 117,186 | 87,757 |
Gross unrealized gains | 3,070 | 4,758 |
Gross unrealized losses | 1,421 | 87 |
Estimated fair value | 118,835 | 92,428 |
Total | ||
Investment Securities Available for Sale | ||
Gross unrealized gains | 5,577 | 7,901 |
Gross unrealized losses | $ 2,590 | $ 888 |
2. Investment securities (Det_2
2. Investment securities (Details 1) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021 | Dec. 31, 2020 | |
Investment Securities With Continuous Unrealized Loss Position | ||
Less than 12 months, fair value | $ 120,742 | $ 87,953 |
Less than 12 months, unrealized losses | 2,368 | 652 |
12 months or more, fair value | 6,077 | 8,955 |
12 months or more, unrealized losses | 222 | 236 |
Total, fair value | 126,819 | 96,908 |
Total, unrealized losses | 2,590 | 888 |
U.S. Government Sponsored Enterprises | ||
Investment Securities With Continuous Unrealized Loss Position | ||
Less than 12 months, fair value | 0 | 0 |
Less than 12 months, unrealized losses | 0 | 0 |
12 months or more, fair value | 4,098 | 4,193 |
12 months or more, unrealized losses | 202 | 208 |
Total, fair value | 4,098 | 4,193 |
Total, unrealized losses | 202 | 208 |
Mortgage-Backed Securities | ||
Investment Securities With Continuous Unrealized Loss Position | ||
Less than 12 months, fair value | 82,322 | 80,827 |
Less than 12 months, unrealized losses | 947 | 565 |
12 months or more, fair value | 1,979 | 4,762 |
12 months or more, unrealized losses | 20 | 28 |
Total, fair value | 84,301 | 85,589 |
Total, unrealized losses | 967 | 593 |
State and Political Subdivisions | ||
Investment Securities With Continuous Unrealized Loss Position | ||
Less than 12 months, fair value | 38,420 | 7,126 |
Less than 12 months, unrealized losses | 1,421 | 87 |
12 months or more, fair value | 0 | 0 |
12 months or more, unrealized losses | 0 | 0 |
Total, fair value | 38,420 | 7,126 |
Total, unrealized losses | $ 1,421 | $ 87 |
2. Investment securities (Det_3
2. Investment securities (Details 2) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Amortized Cost | ||
Due within one year | $ 15,906 | |
Due from one to five years | 10,216 | |
Due from five to ten years | 87,596 | |
Due after ten years | 24,367 | |
Mortgage-backed securities | 184,445 | |
Total | 322,530 | $ 238,236 |
Estimated Fair Value | ||
Due within one year | 16,126 | |
Due from one to five years | 10,785 | |
Due from five to ten years | 89,027 | |
Due after ten years | 23,876 | |
Mortgage-backed securities | 185,703 | |
Total | $ 325,517 |
2. Investment Securities (Det_4
2. Investment Securities (Details Narrative) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Investments, Debt and Equity Securities [Abstract] | ||
Unrealized losses in the investment securites portfolio relating to debt securities | $ (2,600) | $ 0 |
Securities pledged to secure public deposits | $ 76,600 | $ 77,300 |
3. Loans (Details)
3. Loans (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 | Mar. 31, 2020 | Dec. 31, 2019 |
Major Classifications | ||||
Total loans | $ 946,497 | $ 948,639 | $ 880,564 | |
Less allowance for loan losses | 9,532 | 9,908 | 8,112 | $ 6,680 |
Total net loans | 936,965 | 938,731 | ||
Construction and Land Development | ||||
Major Classifications | ||||
Total loans | 87,878 | 94,124 | 105,939 | |
Less allowance for loan losses | 1,061 | 1,196 | 1,293 | 694 |
Single-Family Residential | ||||
Major Classifications | ||||
Total loans | 264,356 | 272,325 | 271,489 | |
Less allowance for loan losses | 1,850 | 1,843 | 1,713 | 1,274 |
Single-Family Residential - Banco de la Gente Non-Tradtional | ||||
Major Classifications | ||||
Total loans | 26,278 | 26,883 | 29,887 | |
Less allowance for loan losses | 1,033 | 1,052 | 1,084 | 1,073 |
Commercial | ||||
Major Classifications | ||||
Total loans | 337,943 | 332,971 | 301,490 | |
Less allowance for loan losses | 2,252 | 2,212 | 1,799 | 1,305 |
Multifamily and Farmland | ||||
Major Classifications | ||||
Total loans | 57,914 | 48,880 | 48,191 | |
Less allowance for loan losses | 145 | 122 | 118 | 120 |
Total Real Estate Loans | ||||
Major Classifications | ||||
Total loans | 774,369 | 775,183 | ||
Commercial Loans (Not Secured by Real Estate) | ||||
Major Classifications | ||||
Total loans | 160,892 | 161,740 | 104,221 | |
Less allowance for loan losses | 1,244 | 1,345 | 1,017 | 688 |
Farm Loans (Not Secured by Real Estate) | ||||
Major Classifications | ||||
Total loans | 860 | 855 | 1,044 | |
Less allowance for loan losses | 0 | 0 | $ 0 | $ 0 |
Consumer Loans (Not Secured by Real Estate) | ||||
Major Classifications | ||||
Total loans | 6,778 | 7,113 | ||
All Other Loans (Not Secured by Real Estate) | ||||
Major Classifications | ||||
Total loans | $ 3,598 | $ 3,748 |
3. Loans (Details 1)
3. Loans (Details 1) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 | Mar. 31, 2020 |
Past Due Loans | |||
Loans 30-89 days past due | $ 6,347 | $ 7,605 | |
Loans 90 or more days past due | 117 | 377 | |
Total past due loans | 6,464 | 7,982 | |
Total current loans | 940,033 | 940,657 | |
Total loans | 946,497 | 948,639 | $ 880,564 |
Construction and Land Development | |||
Past Due Loans | |||
Loans 30-89 days past due | 434 | 298 | |
Loans 90 or more days past due | 0 | 0 | |
Total past due loans | 434 | 298 | |
Total current loans | 87,444 | 93,826 | |
Total loans | 87,878 | 94,124 | |
Accruing loans 90 or more days past due | 0 | 0 | |
Single-Family Residential | |||
Past Due Loans | |||
Loans 30-89 days past due | 2,314 | 3,660 | |
Loans 90 or more days past due | 67 | 270 | |
Total past due loans | 2,381 | 3,930 | |
Total current loans | 261,975 | 268,395 | |
Total loans | 264,356 | 272,325 | |
Accruing loans 90 or more days past due | 0 | 0 | |
Single-Family Residential - Banco de la Gente Non-Tradtional | |||
Past Due Loans | |||
Loans 30-89 days past due | 2,709 | 3,566 | |
Loans 90 or more days past due | 48 | 105 | |
Total past due loans | 2,757 | 3,671 | |
Total current loans | 23,521 | 23,212 | |
Total loans | 26,278 | 26,883 | |
Accruing loans 90 or more days past due | 0 | 0 | |
Commercial | |||
Past Due Loans | |||
Loans 30-89 days past due | 713 | 36 | |
Loans 90 or more days past due | 0 | 0 | |
Total past due loans | 713 | 36 | |
Total current loans | 337,230 | 332,935 | |
Total loans | 337,943 | 332,971 | |
Accruing loans 90 or more days past due | 0 | 0 | |
Multifamily and Farmland | |||
Past Due Loans | |||
Loans 30-89 days past due | 0 | 0 | |
Loans 90 or more days past due | 0 | 0 | |
Total past due loans | 0 | 0 | |
Total current loans | 57,914 | 48,880 | |
Total loans | 57,914 | 48,880 | |
Accruing loans 90 or more days past due | 0 | 0 | |
Total Real Estate Loans | |||
Past Due Loans | |||
Loans 30-89 days past due | 6,170 | 7,560 | |
Loans 90 or more days past due | 115 | 375 | |
Total past due loans | 6,285 | 7,935 | |
Total current loans | 768,084 | 767,248 | |
Total loans | 774,369 | 775,183 | |
Accruing loans 90 or more days past due | 0 | 0 | |
Commercial Loans (Not Secured by Real Estate) | |||
Past Due Loans | |||
Loans 30-89 days past due | 144 | 0 | |
Loans 90 or more days past due | 0 | 0 | |
Total past due loans | 144 | 0 | |
Total current loans | 160,748 | 161,740 | |
Total loans | 160,892 | 161,740 | |
Farm Loans (Not Secured by Real Estate) | |||
Past Due Loans | |||
Loans 30-89 days past due | 0 | 0 | |
Loans 90 or more days past due | 0 | 0 | |
Total past due loans | 0 | 0 | |
Total current loans | 860 | 855 | |
Total loans | 860 | 855 | |
Consumer Loans (Not Secured by Real Estate) | |||
Past Due Loans | |||
Loans 30-89 days past due | 33 | 45 | |
Loans 90 or more days past due | 2 | 2 | |
Total past due loans | 35 | 47 | |
Total current loans | 6,743 | 7,066 | |
Total loans | 6,778 | 7,113 | |
All Other Loans (Not Secured by Real Estate) | |||
Past Due Loans | |||
Loans 30-89 days past due | 0 | 0 | |
Loans 90 or more days past due | 0 | 0 | |
Total past due loans | 0 | 0 | |
Total current loans | 3,598 | 3,748 | |
Total loans | $ 3,598 | $ 3,748 |
3. Loans (Details 2)
3. Loans (Details 2) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Non-Accrual Loans | ||
Non-accrual loans | $ 3,566 | $ 3,758 |
Single-Family Residential | ||
Non-Accrual Loans | ||
Non-accrual loans | 1,207 | 1,266 |
Single-Family Residential - Banco de la Gente Non-Tradtional | ||
Non-Accrual Loans | ||
Non-accrual loans | 1,665 | 1,709 |
Commercial | ||
Non-Accrual Loans | ||
Non-accrual loans | 429 | 440 |
Multifamily and Farmland | ||
Non-Accrual Loans | ||
Non-accrual loans | 115 | 117 |
Total Real Estate Loans | ||
Non-Accrual Loans | ||
Non-accrual loans | 3,416 | 3,532 |
Commercial Loans (Not Secured by Real Estate) | ||
Non-Accrual Loans | ||
Non-accrual loans | 141 | 212 |
Consumer Loans (Not Secured by Real Estate) | ||
Non-Accrual Loans | ||
Non-accrual loans | $ 9 | $ 14 |
3. Loans (Details 3)
3. Loans (Details 3) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | |
Impaired Loans | |||
Unpaid contractual principal balance | $ 21,641 | $ 22,501 | |
Recorded investment with no allowance | 1,490 | 1,672 | |
Recorded investment with allowance | 19,157 | 19,616 | |
Recorded investment in impaired loans | 20,647 | 21,288 | |
Related allowance | 895 | 919 | |
Average outstanding impaired loans | 20,940 | 21,848 | |
Interest income recognized | 283 | $ 329 | 1,250 |
Construction and Land Development | |||
Impaired Loans | |||
Unpaid contractual principal balance | 104 | 108 | |
Recorded investment with no allowance | 0 | 0 | |
Recorded investment with allowance | 104 | 108 | |
Recorded investment in impaired loans | 104 | 108 | |
Related allowance | 4 | 4 | |
Average outstanding impaired loans | 106 | 134 | |
Interest income recognized | 2 | 8 | |
Single-Family Residential | |||
Impaired Loans | |||
Unpaid contractual principal balance | 4,837 | 5,302 | |
Recorded investment with no allowance | 278 | 379 | |
Recorded investment with allowance | 4,248 | 4,466 | |
Recorded investment in impaired loans | 4,526 | 4,845 | |
Related allowance | 30 | 33 | |
Average outstanding impaired loans | 5,490 | 4,741 | |
Interest income recognized | 60 | 262 | |
Single-Family Residential - Banco de la Gente Non-Tradtional | |||
Impaired Loans | |||
Unpaid contractual principal balance | 13,162 | 13,417 | |
Recorded investment with no allowance | 0 | 0 | |
Recorded investment with allowance | 12,575 | 12,753 | |
Recorded investment in impaired loans | 12,575 | 12,753 | |
Related allowance | 843 | 862 | |
Average outstanding impaired loans | 11,832 | 13,380 | |
Interest income recognized | 177 | 798 | |
Commercial | |||
Impaired Loans | |||
Unpaid contractual principal balance | 2,966 | 2,999 | |
Recorded investment with no allowance | 1,071 | 1,082 | |
Recorded investment with allowance | 1,865 | 1,891 | |
Recorded investment in impaired loans | 2,936 | 2,973 | |
Related allowance | 14 | 14 | |
Average outstanding impaired loans | 2,955 | 2,940 | |
Interest income recognized | 36 | 139 | |
Multifamily and Farmland | |||
Impaired Loans | |||
Unpaid contractual principal balance | 118 | 119 | |
Recorded investment with no allowance | 0 | 0 | |
Recorded investment with allowance | 115 | 117 | |
Recorded investment in impaired loans | 115 | 117 | |
Related allowance | 0 | 0 | |
Average outstanding impaired loans | 116 | 29 | |
Interest income recognized | 1 | 6 | |
Total Real Estate Loans | |||
Impaired Loans | |||
Unpaid contractual principal balance | 21,187 | 21,945 | |
Recorded investment with no allowance | 1,349 | 1,461 | |
Recorded investment with allowance | 18,907 | 19,335 | |
Recorded investment in impaired loans | 20,256 | 20,796 | |
Related allowance | 891 | 913 | |
Average outstanding impaired loans | 20,499 | 21,224 | |
Interest income recognized | 276 | 1,213 | |
Commercial Loans (Not Secured by Real Estate) | |||
Impaired Loans | |||
Unpaid contractual principal balance | 430 | 515 | |
Recorded investment with no allowance | 141 | 211 | |
Recorded investment with allowance | 231 | 244 | |
Recorded investment in impaired loans | 372 | 455 | |
Related allowance | 4 | 5 | |
Average outstanding impaired loans | 413 | 564 | |
Interest income recognized | 6 | 32 | |
Consumer Loans (Not Secured by Real Estate) | |||
Impaired Loans | |||
Unpaid contractual principal balance | 24 | 41 | |
Recorded investment with no allowance | 0 | 0 | |
Recorded investment with allowance | 19 | 37 | |
Recorded investment in impaired loans | 19 | 37 | |
Related allowance | 0 | 1 | |
Average outstanding impaired loans | 28 | 60 | |
Interest income recognized | $ 1 | $ 5 |
3. Loans (Details 4)
3. Loans (Details 4) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Allowance for Loan Losses | ||
Beginning balance | $ 9,908 | $ 6,680 |
Charge-offs | (85) | (210) |
Recoveries | 164 | 121 |
Provision | (455) | 1,521 |
Ending balance | 9,532 | 8,112 |
Ending balance: individually evaluated for impairments | 840 | 952 |
Ending balance: collectively evaluated for impairments | 8,692 | 7,160 |
Ending balance | 9,532 | 8,112 |
Loans | ||
Ending balance | 946,497 | 880,564 |
Ending balance: individually evaluated for impairment | 14,883 | 16,614 |
Ending balance: collectively evaluated for impairment | 931,614 | 863,950 |
Construction and Land Development | ||
Allowance for Loan Losses | ||
Beginning balance | 1,196 | 694 |
Charge-offs | 0 | (5) |
Recoveries | 50 | 2 |
Provision | (185) | 602 |
Ending balance | 1,061 | 1,293 |
Ending balance: individually evaluated for impairments | 2 | 2 |
Ending balance: collectively evaluated for impairments | 1,059 | 1,291 |
Ending balance | 1,061 | 1,293 |
Loans | ||
Ending balance | 87,878 | 105,939 |
Ending balance: individually evaluated for impairment | 7 | 8 |
Ending balance: collectively evaluated for impairment | 87,871 | 105,931 |
Single-Family Residential | ||
Allowance for Loan Losses | ||
Beginning balance | 1,843 | 1,274 |
Charge-offs | 0 | 0 |
Recoveries | 60 | 16 |
Provision | (53) | 423 |
Ending balance | 1,850 | 1,713 |
Ending balance: individually evaluated for impairments | 4 | 6 |
Ending balance: collectively evaluated for impairments | 1,846 | 1,707 |
Ending balance | 1,850 | 1,713 |
Loans | ||
Ending balance | 264,356 | 271,489 |
Ending balance: individually evaluated for impairment | 1,444 | 1,678 |
Ending balance: collectively evaluated for impairment | 262,912 | 269,811 |
Single-Family Residential - Banco de la Gente Non-Tradtional | ||
Allowance for Loan Losses | ||
Beginning balance | 1,052 | 1,073 |
Charge-offs | 0 | 0 |
Recoveries | 0 | 0 |
Provision | (19) | 11 |
Ending balance | 1,033 | 1,084 |
Ending balance: individually evaluated for impairments | 826 | 906 |
Ending balance: collectively evaluated for impairments | 207 | 178 |
Ending balance | 1,033 | 1,084 |
Loans | ||
Ending balance | 26,278 | 29,887 |
Ending balance: individually evaluated for impairment | 11,193 | 12,489 |
Ending balance: collectively evaluated for impairment | 15,085 | 17,398 |
Commercial | ||
Allowance for Loan Losses | ||
Beginning balance | 2,212 | 1,305 |
Charge-offs | 0 | (7) |
Recoveries | 12 | 23 |
Provision | 28 | 478 |
Ending balance | 2,252 | 1,799 |
Ending balance: individually evaluated for impairments | 8 | 9 |
Ending balance: collectively evaluated for impairments | 2,244 | 1,790 |
Ending balance | 2,252 | 1,799 |
Loans | ||
Ending balance | 337,943 | 301,490 |
Ending balance: individually evaluated for impairment | 2,098 | 2,095 |
Ending balance: collectively evaluated for impairment | 335,845 | 299,395 |
Multifamily and Farmland | ||
Allowance for Loan Losses | ||
Beginning balance | 122 | 120 |
Charge-offs | 0 | 0 |
Recoveries | 0 | 0 |
Provision | 23 | (2) |
Ending balance | 145 | 118 |
Ending balance: individually evaluated for impairments | 0 | 0 |
Ending balance: collectively evaluated for impairments | 145 | 118 |
Ending balance | 145 | 118 |
Loans | ||
Ending balance | 57,914 | 48,191 |
Ending balance: individually evaluated for impairment | 0 | 0 |
Ending balance: collectively evaluated for impairment | 57,914 | 48,191 |
Commercial Loans (Not Secured by Real Estate) | ||
Allowance for Loan Losses | ||
Beginning balance | 1,345 | 688 |
Charge-offs | 0 | (31) |
Recoveries | 3 | 25 |
Provision | (104) | 335 |
Ending balance | 1,244 | 1,017 |
Ending balance: individually evaluated for impairments | 0 | 29 |
Ending balance: collectively evaluated for impairments | 1,244 | 988 |
Ending balance | 1,244 | 1,017 |
Loans | ||
Ending balance | 160,892 | 104,221 |
Ending balance: individually evaluated for impairment | 141 | 344 |
Ending balance: collectively evaluated for impairment | 160,751 | 103,877 |
Farm Loans (Not Secured by Real Estate) | ||
Allowance for Loan Losses | ||
Beginning balance | 0 | 0 |
Charge-offs | 0 | 0 |
Recoveries | 0 | 0 |
Provision | 0 | 0 |
Ending balance | 0 | 0 |
Ending balance: individually evaluated for impairments | 0 | 0 |
Ending balance: collectively evaluated for impairments | 0 | 0 |
Ending balance | 0 | 0 |
Loans | ||
Ending balance | 860 | 1,044 |
Ending balance: individually evaluated for impairment | 0 | 0 |
Ending balance: collectively evaluated for impairment | 860 | 1,044 |
Consumer And All Other Loans | ||
Allowance for Loan Losses | ||
Beginning balance | 128 | 138 |
Charge-offs | (85) | (167) |
Recoveries | 39 | 55 |
Provision | 9 | 154 |
Ending balance | 91 | 180 |
Ending balance: individually evaluated for impairments | 0 | 0 |
Ending balance: collectively evaluated for impairments | 91 | 180 |
Ending balance | 91 | 180 |
Loans | ||
Ending balance | 10,376 | 18,303 |
Ending balance: individually evaluated for impairment | 0 | 0 |
Ending balance: collectively evaluated for impairment | 10,376 | 18,303 |
Unallocated | ||
Allowance for Loan Losses | ||
Beginning balance | 2,010 | 1,388 |
Charge-offs | 0 | 0 |
Recoveries | 0 | 0 |
Provision | (154) | (480) |
Ending balance | 1,856 | 908 |
Ending balance: individually evaluated for impairments | 0 | 0 |
Ending balance: collectively evaluated for impairments | 1,856 | 908 |
Ending balance | 1,856 | 908 |
Loans | ||
Ending balance | 0 | 0 |
Ending balance: individually evaluated for impairment | 0 | 0 |
Ending balance: collectively evaluated for impairment | $ 0 | $ 0 |
3. Loans (Details 5)
3. Loans (Details 5) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 | Mar. 31, 2020 |
Credit Risk Profile | |||
Total loans | $ 946,497 | $ 948,639 | $ 880,564 |
Excellent Quality | |||
Credit Risk Profile | |||
Total loans | 6,333 | 11,179 | |
High Quality | |||
Credit Risk Profile | |||
Total loans | 183,887 | 194,001 | |
Good Quality | |||
Credit Risk Profile | |||
Total loans | 642,517 | 623,201 | |
Management Attention | |||
Credit Risk Profile | |||
Total loans | 85,240 | 92,523 | |
Watch | |||
Credit Risk Profile | |||
Total loans | 21,608 | 20,908 | |
Substandard | |||
Credit Risk Profile | |||
Total loans | 6,912 | 6,827 | |
Doubtful | |||
Credit Risk Profile | |||
Total loans | 0 | 0 | |
Loss | |||
Credit Risk Profile | |||
Total loans | 0 | 0 | |
Construction and Land Development | |||
Credit Risk Profile | |||
Total loans | 87,878 | 94,124 | |
Single-Family Residential | |||
Credit Risk Profile | |||
Total loans | 264,356 | 272,325 | |
Single-Family Residential - Banco de la Gente Non-Tradtional | |||
Credit Risk Profile | |||
Total loans | 26,278 | 26,883 | |
Commercial | |||
Credit Risk Profile | |||
Total loans | 337,943 | 332,971 | |
Multifamily and Farmland | |||
Credit Risk Profile | |||
Total loans | 57,914 | 48,880 | |
Commercial Loans (Not Secured by Real Estate) | |||
Credit Risk Profile | |||
Total loans | 160,892 | 161,740 | |
Farm Loans (Not Secured by Real Estate) | |||
Credit Risk Profile | |||
Total loans | 860 | 855 | |
Consumer Loans (Not Secured by Real Estate) | |||
Credit Risk Profile | |||
Total loans | 6,778 | 7,113 | |
All Other Loans (Not Secured by Real Estate) | |||
Credit Risk Profile | |||
Total loans | 3,598 | 3,748 | |
Construction and Land Development | |||
Credit Risk Profile | |||
Total loans | 87,878 | 94,124 | 105,939 |
Construction and Land Development | Excellent Quality | |||
Credit Risk Profile | |||
Total loans | 0 | 228 | |
Construction and Land Development | High Quality | |||
Credit Risk Profile | |||
Total loans | 10,147 | 9,092 | |
Construction and Land Development | Good Quality | |||
Credit Risk Profile | |||
Total loans | 71,651 | 76,897 | |
Construction and Land Development | Management Attention | |||
Credit Risk Profile | |||
Total loans | 3,413 | 4,917 | |
Construction and Land Development | Watch | |||
Credit Risk Profile | |||
Total loans | 2,586 | 2,906 | |
Construction and Land Development | Substandard | |||
Credit Risk Profile | |||
Total loans | 81 | 84 | |
Construction and Land Development | Doubtful | |||
Credit Risk Profile | |||
Total loans | 0 | 0 | |
Construction and Land Development | Loss | |||
Credit Risk Profile | |||
Total loans | 0 | 0 | |
Single-Family Residential | |||
Credit Risk Profile | |||
Total loans | 264,356 | 272,325 | 271,489 |
Single-Family Residential | Excellent Quality | |||
Credit Risk Profile | |||
Total loans | 5,196 | 9,867 | |
Single-Family Residential | High Quality | |||
Credit Risk Profile | |||
Total loans | 113,727 | 121,331 | |
Single-Family Residential | Good Quality | |||
Credit Risk Profile | |||
Total loans | 119,255 | 115,109 | |
Single-Family Residential | Management Attention | |||
Credit Risk Profile | |||
Total loans | 19,477 | 20,012 | |
Single-Family Residential | Watch | |||
Credit Risk Profile | |||
Total loans | 3,633 | 2,947 | |
Single-Family Residential | Substandard | |||
Credit Risk Profile | |||
Total loans | 3,068 | 3,059 | |
Single-Family Residential | Doubtful | |||
Credit Risk Profile | |||
Total loans | 0 | 0 | |
Single-Family Residential | Loss | |||
Credit Risk Profile | |||
Total loans | 0 | 0 | |
Single-Family Residential - Banco de la Gente Non-Tradtional | |||
Credit Risk Profile | |||
Total loans | 26,278 | 26,883 | 29,887 |
Single-Family Residential - Banco de la Gente Non-Tradtional | Excellent Quality | |||
Credit Risk Profile | |||
Total loans | 0 | 0 | |
Single-Family Residential - Banco de la Gente Non-Tradtional | High Quality | |||
Credit Risk Profile | |||
Total loans | 0 | 0 | |
Single-Family Residential - Banco de la Gente Non-Tradtional | Good Quality | |||
Credit Risk Profile | |||
Total loans | 9,856 | 10,170 | |
Single-Family Residential - Banco de la Gente Non-Tradtional | Management Attention | |||
Credit Risk Profile | |||
Total loans | 11,998 | 12,312 | |
Single-Family Residential - Banco de la Gente Non-Tradtional | Watch | |||
Credit Risk Profile | |||
Total loans | 1,883 | 1,901 | |
Single-Family Residential - Banco de la Gente Non-Tradtional | Substandard | |||
Credit Risk Profile | |||
Total loans | 2,541 | 2,500 | |
Single-Family Residential - Banco de la Gente Non-Tradtional | Doubtful | |||
Credit Risk Profile | |||
Total loans | 0 | 0 | |
Single-Family Residential - Banco de la Gente Non-Tradtional | Loss | |||
Credit Risk Profile | |||
Total loans | 0 | 0 | |
Commercial | |||
Credit Risk Profile | |||
Total loans | 337,943 | 332,971 | 301,490 |
Commercial | Excellent Quality | |||
Credit Risk Profile | |||
Total loans | 0 | 0 | |
Commercial | High Quality | |||
Credit Risk Profile | |||
Total loans | 39,402 | 40,569 | |
Commercial | Good Quality | |||
Credit Risk Profile | |||
Total loans | 249,646 | 241,273 | |
Commercial | Management Attention | |||
Credit Risk Profile | |||
Total loans | 37,337 | 39,370 | |
Commercial | Watch | |||
Credit Risk Profile | |||
Total loans | 10,684 | 10,871 | |
Commercial | Substandard | |||
Credit Risk Profile | |||
Total loans | 874 | 888 | |
Commercial | Doubtful | |||
Credit Risk Profile | |||
Total loans | 0 | 0 | |
Commercial | Loss | |||
Credit Risk Profile | |||
Total loans | 0 | 0 | |
Multifamily and Farmland | |||
Credit Risk Profile | |||
Total loans | 57,914 | 48,880 | 48,191 |
Multifamily and Farmland | Excellent Quality | |||
Credit Risk Profile | |||
Total loans | 0 | 0 | |
Multifamily and Farmland | High Quality | |||
Credit Risk Profile | |||
Total loans | 20 | 22 | |
Multifamily and Farmland | Good Quality | |||
Credit Risk Profile | |||
Total loans | 54,014 | 44,890 | |
Multifamily and Farmland | Management Attention | |||
Credit Risk Profile | |||
Total loans | 3,196 | 3,274 | |
Multifamily and Farmland | Watch | |||
Credit Risk Profile | |||
Total loans | 569 | 694 | |
Multifamily and Farmland | Substandard | |||
Credit Risk Profile | |||
Total loans | 115 | 0 | |
Multifamily and Farmland | Doubtful | |||
Credit Risk Profile | |||
Total loans | 0 | 0 | |
Multifamily and Farmland | Loss | |||
Credit Risk Profile | |||
Total loans | 0 | 0 | |
Commercial Loans (Not Secured by Real Estate) | |||
Credit Risk Profile | |||
Total loans | 160,892 | 161,740 | 104,221 |
Commercial Loans (Not Secured by Real Estate) | Excellent Quality | |||
Credit Risk Profile | |||
Total loans | 436 | 406 | |
Commercial Loans (Not Secured by Real Estate) | High Quality | |||
Credit Risk Profile | |||
Total loans | 16,955 | 19,187 | |
Commercial Loans (Not Secured by Real Estate) | Good Quality | |||
Credit Risk Profile | |||
Total loans | 132,296 | 128,727 | |
Commercial Loans (Not Secured by Real Estate) | Management Attention | |||
Credit Risk Profile | |||
Total loans | 8,761 | 11,571 | |
Commercial Loans (Not Secured by Real Estate) | Watch | |||
Credit Risk Profile | |||
Total loans | 2,248 | 1,583 | |
Commercial Loans (Not Secured by Real Estate) | Substandard | |||
Credit Risk Profile | |||
Total loans | 196 | 266 | |
Commercial Loans (Not Secured by Real Estate) | Doubtful | |||
Credit Risk Profile | |||
Total loans | 0 | 0 | |
Commercial Loans (Not Secured by Real Estate) | Loss | |||
Credit Risk Profile | |||
Total loans | 0 | 0 | |
Farm Loans (Not Secured by Real Estate) | |||
Credit Risk Profile | |||
Total loans | 860 | 855 | $ 1,044 |
Farm Loans (Not Secured by Real Estate) | Excellent Quality | |||
Credit Risk Profile | |||
Total loans | 0 | 0 | |
Farm Loans (Not Secured by Real Estate) | High Quality | |||
Credit Risk Profile | |||
Total loans | 0 | 0 | |
Farm Loans (Not Secured by Real Estate) | Good Quality | |||
Credit Risk Profile | |||
Total loans | 839 | 832 | |
Farm Loans (Not Secured by Real Estate) | Management Attention | |||
Credit Risk Profile | |||
Total loans | 21 | 23 | |
Farm Loans (Not Secured by Real Estate) | Watch | |||
Credit Risk Profile | |||
Total loans | 0 | 0 | |
Farm Loans (Not Secured by Real Estate) | Substandard | |||
Credit Risk Profile | |||
Total loans | 0 | 0 | |
Farm Loans (Not Secured by Real Estate) | Doubtful | |||
Credit Risk Profile | |||
Total loans | 0 | 0 | |
Farm Loans (Not Secured by Real Estate) | Loss | |||
Credit Risk Profile | |||
Total loans | 0 | 0 | |
Consumer Loans (Not Secured by Real Estate) | |||
Credit Risk Profile | |||
Total loans | 6,778 | 7,113 | |
Consumer Loans (Not Secured by Real Estate) | Excellent Quality | |||
Credit Risk Profile | |||
Total loans | 701 | 678 | |
Consumer Loans (Not Secured by Real Estate) | High Quality | |||
Credit Risk Profile | |||
Total loans | 2,150 | 2,237 | |
Consumer Loans (Not Secured by Real Estate) | Good Quality | |||
Credit Risk Profile | |||
Total loans | 3,540 | 3,826 | |
Consumer Loans (Not Secured by Real Estate) | Management Attention | |||
Credit Risk Profile | |||
Total loans | 345 | 336 | |
Consumer Loans (Not Secured by Real Estate) | Watch | |||
Credit Risk Profile | |||
Total loans | 5 | 6 | |
Consumer Loans (Not Secured by Real Estate) | Substandard | |||
Credit Risk Profile | |||
Total loans | 37 | 30 | |
Consumer Loans (Not Secured by Real Estate) | Doubtful | |||
Credit Risk Profile | |||
Total loans | 0 | 0 | |
Consumer Loans (Not Secured by Real Estate) | Loss | |||
Credit Risk Profile | |||
Total loans | 0 | 0 | |
All Other Loans (Not Secured by Real Estate) | |||
Credit Risk Profile | |||
Total loans | 3,598 | 3,748 | |
All Other Loans (Not Secured by Real Estate) | Excellent Quality | |||
Credit Risk Profile | |||
Total loans | 0 | 0 | |
All Other Loans (Not Secured by Real Estate) | High Quality | |||
Credit Risk Profile | |||
Total loans | 1,486 | 1,563 | |
All Other Loans (Not Secured by Real Estate) | Good Quality | |||
Credit Risk Profile | |||
Total loans | 1,420 | 1,477 | |
All Other Loans (Not Secured by Real Estate) | Management Attention | |||
Credit Risk Profile | |||
Total loans | 692 | 708 | |
All Other Loans (Not Secured by Real Estate) | Watch | |||
Credit Risk Profile | |||
Total loans | 0 | 0 | |
All Other Loans (Not Secured by Real Estate) | Substandard | |||
Credit Risk Profile | |||
Total loans | 0 | 0 | |
All Other Loans (Not Secured by Real Estate) | Doubtful | |||
Credit Risk Profile | |||
Total loans | 0 | 0 | |
All Other Loans (Not Secured by Real Estate) | Loss | |||
Credit Risk Profile | |||
Total loans | $ 0 | $ 0 |
3. Loans (Details Narrative)
3. Loans (Details Narrative) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | |
Receivables [Abstract] | |||
Percentage of construction and land development loans in Bank's loan portfolio | 9.00% | ||
Percentage of single-family residential loans in Bank's loan portfolio | 31.00% | ||
Percentage of single-family residential - Banco de la Gente stated income loans in Bank's loan portfolio | 3.00% | ||
Percentage of commercial real estate loans in Bank's loan portfolio | 36.00% | ||
Percentage of commercial loans in Bank's loan portfolio | 17.00% | ||
Accruing impaired loans | $ 20,600 | $ 22,800 | $ 21,300 |
Interest income recognized on accruing impaired loans | 283 | 329 | 1,250 |
Provision for loan losses | 455 | $ 1,500 | |
TDR loans modified, past-due TDR loans and non-accrual TDR Loans | $ 3,400 | $ 3,800 |
4. Net Earnings Per Share (Deta
4. Net Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Net Earnings | ||
Basic earnings per share | $ 4,121 | $ 2,367 |
Effect of dilutive securities: restricted stock units | 0 | 0 |
Effect of dilutive securities: shares held in deferred comp plan | 0 | 0 |
Diluted earnings per share | $ 4,121 | $ 2,367 |
Weighted Average Number of Shares | ||
Basic earnings per share (in shares) | 5,631,414 | 5,723,540 |
Effect of dilutive securities: restricted stock units (in shares) | 12,169 | 13,440 |
Effect of dilutive securities: shares held in deferred comp plan | 156,662 | 146,938 |
Diluted earnings per share (in shares) | 5,800,245 | 5,883,378 |
Per Share Amount | ||
Basic earnings per share | $ .73 | $ .41 |
Diluted earnings per share | $ 0.71 | $ 0.4 |
5. Stock-Based Compensation (De
5. Stock-Based Compensation (Details Narrative) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
2009 Plan | ||
Unrecognized compensation cost | $ 74 | |
Recognized compensation expense | 44 | $ 44 |
2020 Plan | ||
Unrecognized compensation cost | $ 304 |
6. Fair Value (Details)
6. Fair Value (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Estimated fair value | $ 325,517 | $ 245,249 |
Level 1 | ||
Estimated fair value | 0 | 0 |
Level 2 | ||
Estimated fair value | 325,517 | 245,249 |
Level 3 | ||
Estimated fair value | 0 | 0 |
U.S. Treasuries | ||
Estimated fair value | 7,960 | 0 |
U.S. Treasuries | Level 1 | ||
Estimated fair value | 0 | |
U.S. Treasuries | Level 2 | ||
Estimated fair value | 7,960 | |
U.S. Treasuries | Level 3 | ||
Estimated fair value | 0 | |
U.S. Government Sponsored Enterprises | ||
Estimated fair value | 13,019 | 7,507 |
U.S. Government Sponsored Enterprises | Level 1 | ||
Estimated fair value | 0 | 0 |
U.S. Government Sponsored Enterprises | Level 2 | ||
Estimated fair value | 13,019 | 7,507 |
U.S. Government Sponsored Enterprises | Level 3 | ||
Estimated fair value | 0 | 0 |
Mortgage-Backed Securities | ||
Estimated fair value | 185,703 | 145,314 |
Mortgage-Backed Securities | Level 1 | ||
Estimated fair value | 0 | 0 |
Mortgage-Backed Securities | Level 2 | ||
Estimated fair value | 185,703 | 145,314 |
Mortgage-Backed Securities | Level 3 | ||
Estimated fair value | 0 | 0 |
State and Political Subdivisions | ||
Estimated fair value | 118,835 | 92,428 |
State and Political Subdivisions | Level 1 | ||
Estimated fair value | 0 | 0 |
State and Political Subdivisions | Level 2 | ||
Estimated fair value | 118,835 | 92,428 |
State and Political Subdivisions | Level 3 | ||
Estimated fair value | 0 | 0 |
Mutual funds held in deferred compensation trust | ||
Mutual funds held in deferred compensation trust | 1,372 | 1,320 |
Mutual funds held in deferred compensation trust | Level 1 | ||
Mutual funds held in deferred compensation trust | 0 | 0 |
Mutual funds held in deferred compensation trust | Level 2 | ||
Mutual funds held in deferred compensation trust | 1,372 | 1,320 |
Mutual funds held in deferred compensation trust | Level 3 | ||
Mutual funds held in deferred compensation trust | $ 0 | $ 0 |
6. Fair Value (Details 1)
6. Fair Value (Details 1) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Dec. 31, 2020 | |
Mortgage loans held for sale | $ 4,236 | $ 9,139 |
Impaired loans | 19,752 | 20,369 |
Other real estate | $ 128 | 128 |
Mortgage Loans Held For Sale | ||
Valuation technique | Rate lock commitment | |
Significant unobservable inputs | N/A | |
General range of significant unobservable input values | N/A | |
Impaired Loans | ||
Valuation technique | Appraised value and discounted cash flows | |
Significant unobservable inputs | Discounts to reflect current market conditions and ultimate collectability | |
General range of significant unobservable input values | 0 - 25% | |
Other Real Estate | ||
Valuation technique | Appraised value | |
Significant unobservable inputs | Discounts to reflect current market conditions and estimated costs to sell | |
General range of significant unobservable input values | 0 - 25% | |
Level 1 | ||
Mortgage loans held for sale | $ 0 | 0 |
Impaired loans | 0 | 0 |
Other real estate | 0 | 0 |
Level 2 | ||
Mortgage loans held for sale | 0 | 0 |
Impaired loans | 0 | 0 |
Other real estate | 0 | 0 |
Level 3 | ||
Mortgage loans held for sale | 4,236 | 9,139 |
Impaired loans | 19,572 | 20,369 |
Other real estate | $ 128 | $ 128 |
6. Fair Value (Details 2)
6. Fair Value (Details 2) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Assets: | ||
Cash and cash equivalents | $ 209,037 | $ 161,580 |
Investment securities available for sale | 325,517 | 245,249 |
Other investments | 3,791 | 4,155 |
Mortgage loans held for sale | 4,236 | 9,139 |
Loans, net | 936,965 | 938,731 |
Mutual funds held in deferred compensation trust | 1,372 | 1,320 |
Liabilities: | ||
Deposits | 1,334,465 | 1,221,086 |
Securities sold under agreements to repurchase | 31,916 | 26,201 |
Junior subordinated debentures | 15,464 | 15,464 |
Estimated Fair Value | ||
Assets: | ||
Cash and cash equivalents | 209,037 | 161,580 |
Investment securities available for sale | 325,517 | 245,249 |
Other investments | 3,791 | 4,155 |
Mortgage loans held for sale | 4,236 | 9,139 |
Loans, net | 921,096 | 924,845 |
Mutual funds held in deferred compensation trust | 1,372 | 1,320 |
Liabilities: | ||
Deposits | 1,330,015 | 1,216,503 |
Securities sold under agreements to repurchase | 31,916 | 26,201 |
Junior subordinated debentures | 15,464 | 15,464 |
Level 1 | ||
Assets: | ||
Cash and cash equivalents | 209,037 | 161,580 |
Investment securities available for sale | 0 | 0 |
Other investments | 0 | 0 |
Mortgage loans held for sale | 0 | 0 |
Loans, net | 0 | 0 |
Mutual funds held in deferred compensation trust | 0 | 0 |
Liabilities: | ||
Deposits | 0 | 0 |
Securities sold under agreements to repurchase | 0 | 0 |
Junior subordinated debentures | 0 | 0 |
Level 2 | ||
Assets: | ||
Cash and cash equivalents | 0 | 0 |
Investment securities available for sale | 325,517 | 245,249 |
Other investments | 0 | 0 |
Mortgage loans held for sale | 0 | 0 |
Loans, net | 0 | 0 |
Mutual funds held in deferred compensation trust | 1,372 | 1,320 |
Liabilities: | ||
Deposits | 0 | 0 |
Securities sold under agreements to repurchase | 31,916 | 26,201 |
Junior subordinated debentures | 15,464 | 15,464 |
Level 3 | ||
Assets: | ||
Cash and cash equivalents | 0 | 0 |
Investment securities available for sale | 0 | 0 |
Other investments | 3,791 | 4,155 |
Mortgage loans held for sale | 4,236 | 9,139 |
Loans, net | 921,096 | 924,845 |
Mutual funds held in deferred compensation trust | 0 | 0 |
Liabilities: | ||
Deposits | 1,330,015 | 1,216,503 |
Securities sold under agreements to repurchase | 0 | 0 |
Junior subordinated debentures | $ 0 | $ 0 |
7. Leases (Details)
7. Leases (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Leases [Abstract] | ||
Operating lease cost | $ 195 | $ 224 |
Cash paid for amounts included in the measurement of lease liabilities | 189 | 218 |
Operating cash flows from operating leases | 0 | 0 |
Right-of-use assets obtained in exchange for new lease liabilities - operating leases | $ 0 | $ 0 |
Weighted-average remaining lease term - operating leases | 6 years 11 months 12 days | 7 years 2 months 12 days |
Weighted-average discount rate - operating leases | 2.69% | 3.20% |
7. Leases (Details 1)
7. Leases (Details 1) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Leases [Abstract] | ||
2021 | $ 537 | $ 754 |
2022 | 550 | 588 |
2023 | 544 | 567 |
2024 | 489 | 489 |
2025 | 433 | 433 |
Thereafter | 1,041 | 1,041 |
Total | 3,594 | 3,872 |
Less: imputed interest | (362) | (401) |
Operating lease liability | $ 3,232 | $ 3,471 |
7. Leases (Details Narrative)
7. Leases (Details Narrative) $ in Thousands | Mar. 31, 2021USD ($) |
Leases | |
Operating ROU assets | $ 3,200 |
Operating lease liabilities | $ 3,200 |