Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2020 | Nov. 12, 2020 | |
Cover [Abstract] | ||
Entity Registrant Name | OptimumBank Holdings, Inc. | |
Entity Central Index Key | 0001288855 | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2020 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Reporting Status Current | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business Flag | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 2,951,353 | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2020 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Assets: | ||
Cash and due from banks | $ 25,868 | $ 2,111 |
Interest-bearing deposits with banks | 19,403 | 6,823 |
Total cash and cash equivalents | 45,271 | 8,934 |
Debt securities available for sale | 7,460 | 5,409 |
Debt securities held-to-maturity (fair value of $4,794 and $5,986) | 4,571 | 5,806 |
Loans, net of allowance for loan losses of $2,145 and $2,009 | 144,532 | 102,233 |
Federal Home Loan Bank stock | 1,092 | 642 |
Premises and equipment, net | 1,423 | 1,389 |
Right-of-use operating lease assets | 942 | 1,055 |
Accrued interest receivable | 1,544 | 432 |
Foreclosed real estate | 681 | |
Other assets | 1,088 | 848 |
Total assets | 208,604 | 126,748 |
Liabilities: | ||
Noninterest-bearing demand deposits | 49,946 | 10,545 |
Savings, NOW and money-market deposits | 89,501 | 55,475 |
Time deposits | 28,269 | 35,352 |
Total deposits | 167,716 | 101,372 |
Federal Home Loan Bank advances | 23,000 | 13,000 |
Junior subordinated debenture | 2,580 | 2,580 |
Official checks | 143 | 208 |
Operating lease liabilities | 958 | 1,061 |
Other liabilities | 523 | 1,320 |
Total liabilities | 194,920 | 119,541 |
Commitments and contingencies (Notes 8 and 11) | ||
Stockholders' equity: | ||
Common stock, $.01 par value; 10,000,000 shares authorized, 2,951,353 shares issued and outstanding in 2020 and 2,853,171 shares issued and outstanding in 2019 | 29 | 28 |
Additional paid-in capital | 46,532 | 38,994 |
Accumulated deficit | (32,761) | (31,610) |
Accumulated other comprehensive loss | (116) | (205) |
Total stockholders' equity | 13,684 | 7,207 |
Total liabilities and stockholders' equity | 208,604 | 126,748 |
Designated Series A Preferred Stock [Member] | ||
Stockholders' equity: | ||
Preferred stock value | ||
Designated Series B Preferred Stock [Member] | ||
Stockholders' equity: | ||
Preferred stock value |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Debt securities held to maturity, fair value | $ 4,794 | $ 5,986 |
Loans, allowance for loan losses | $ 2,145 | $ 2,009 |
Preferred stock, par value | ||
Preferred stock, shares authorized | 6,000,000 | 6,000,000 |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 10,000,000 | 10,000,000 |
Common stock, shares issued | 2,951,353 | 2,853,171 |
Common stock, shares outstanding | 2,951,353 | 2,853,171 |
Designated Series A Preferred Stock [Member] | ||
Preferred stock, par value | ||
Preferred stock, shares issued | ||
Preferred stock, shares outstanding | ||
Designated Series B Preferred Stock [Member] | ||
Preferred stock, par value | ||
Preferred stock, shares issued | 280 | |
Preferred stock, shares outstanding | 280 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Interest income: | ||||
Loans | $ 1,723 | $ 1,140 | $ 4,697 | $ 3,328 |
Debt securities | 41 | 63 | 136 | 184 |
Other | 7 | 58 | 67 | 184 |
Total interest income | 1,771 | 1,261 | 4,900 | 3,696 |
Interest expense: | ||||
Deposits | 290 | 408 | 1,047 | 1,057 |
Borrowings | 96 | 130 | 322 | 415 |
Total interest expense | 386 | 538 | 1,369 | 1,472 |
Net interest income | 1,385 | 723 | 3,531 | 2,224 |
Provision for loan losses | 524 | 45 | 1,236 | 45 |
Net interest income after provision for loan losses | 861 | 678 | 2,295 | 2,179 |
Noninterest income: | ||||
Service charges and fees | 1 | 4 | 52 | 11 |
Other | 63 | 25 | 118 | 142 |
Total noninterest income | 64 | 29 | 170 | 153 |
Noninterest expenses: | ||||
Salaries and employee benefits | 582 | 492 | 1,616 | 1,522 |
Professional fees | 121 | 114 | 368 | 341 |
Occupancy and equipment | 146 | 119 | 435 | 366 |
Data processing | 132 | 141 | 381 | 394 |
Insurance | 21 | 24 | 66 | 66 |
Regulatory assessment | 59 | 18 | 129 | 40 |
Other | 360 | 79 | 621 | 511 |
Total noninterest expenses | 1,421 | 987 | 3,616 | 3,240 |
Net loss before income tax benefit | (496) | (280) | (1,151) | (908) |
Income tax benefit | (52) | |||
Net loss | $ (496) | $ (280) | $ (1,151) | $ (856) |
Net loss per share - Basic and diluted | $ (0.17) | $ (.15) | $ (0.39) | $ (.45) |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive Loss (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Income Statement [Abstract] | ||||
Net loss | $ (496) | $ (280) | $ (1,151) | $ (856) |
Change in unrealized gain on debt securities- | ||||
Unrealized (loss) gain arising during the year | (30) | 5 | 36 | 80 |
Amortization of unrealized loss on debt securities transferred to held-to-maturity | 35 | 28 | 83 | 67 |
Other comprehensive income before income tax expense | 5 | 33 | 119 | 147 |
Deferred income tax expense on above change | (2) | (8) | (30) | (37) |
Total other comprehensive income | 3 | 25 | 89 | 110 |
Comprehensive loss | $ (493) | $ (255) | $ (1,062) | $ (746) |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Stockholders' Equity (Unaudited) - USD ($) $ in Thousands | Preferred Stock Series A [Member] | Preferred Stock Series B [Member] | Common Stock [Member] | Additional Paid-In Capital [Member] | Accumulated Deficit [Member] | Accumulated Other Comprehensive Loss [Member] | Total |
Balance beginning at Dec. 31, 2018 | $ 18 | $ 36,128 | $ (30,510) | $ (330) | $ 5,306 | ||
Balance beginning, shares at Dec. 31, 2018 | 1,858,020 | ||||||
Net change in unrealized loss (gain) on securities available for sale, net of income taxes | 3 | 3 | |||||
Amortization of unrealized loss on debt securities transferred to held-to-maturity, net of income taxes | 14 | 14 | |||||
Net loss | (146) | (146) | |||||
Balance ending at Mar. 31, 2019 | $ 18 | 36,128 | (30,656) | (313) | 5,177 | ||
Balance ending, shares at Mar. 31, 2019 | 1,858,020 | ||||||
Balance beginning at Dec. 31, 2018 | $ 18 | 36,128 | (30,510) | (330) | 5,306 | ||
Balance beginning, shares at Dec. 31, 2018 | 1,858,020 | ||||||
Net loss | (856) | ||||||
Balance ending at Sep. 30, 2019 | $ 19 | 36,356 | (31,366) | (220) | 4,792 | ||
Balance ending, shares at Sep. 30, 2019 | 1,928,776 | ||||||
Balance beginning at Mar. 31, 2019 | $ 18 | 36,128 | (30,656) | (313) | 5,177 | ||
Balance beginning, shares at Mar. 31, 2019 | 1,858,020 | ||||||
Net change in unrealized loss (gain) on securities available for sale, net of income taxes | 53 | 53 | |||||
Amortization of unrealized loss on debt securities transferred to held-to-maturity, net of income taxes | 15 | 15 | |||||
Common stock issued and reclassified from other liabilities | 28 | 28 | |||||
Common stock issued and reclassified from other liabilities, shares | 11,250 | ||||||
Common stock issued as compensation to directors | $ 1 | 200 | 201 | ||||
Common stock issued as compensation to directors, shares | 58,309 | ||||||
Net loss | (430) | (430) | |||||
Balance ending at Jun. 30, 2019 | $ 19 | 36,356 | (31,086) | (245) | 5,044 | ||
Balance ending, shares at Jun. 30, 2019 | 1,927,579 | ||||||
Net change in unrealized loss (gain) on securities available for sale, net of income taxes | 4 | 4 | |||||
Amortization of unrealized loss on debt securities transferred to held-to-maturity, net of income taxes | 21 | 21 | |||||
Common stock issued and reclassified from other liabilities | 3 | 3 | |||||
Common stock issued and reclassified from other liabilities, shares | 1,197 | ||||||
Net loss | (280) | (280) | |||||
Balance ending at Sep. 30, 2019 | $ 19 | 36,356 | (31,366) | (220) | 4,792 | ||
Balance ending, shares at Sep. 30, 2019 | 1,928,776 | ||||||
Balance beginning at Dec. 31, 2019 | $ 28 | 38,994 | (31,610) | (205) | 7,207 | ||
Balance beginning, shares at Dec. 31, 2019 | 2,853,171 | ||||||
Net change in unrealized loss (gain) on securities available for sale, net of income taxes | 35 | 35 | |||||
Amortization of unrealized loss on debt securities transferred to held-to-maturity, net of income taxes | 18 | 18 | |||||
Proceeds from sale of common stock | $ 1 | 538 | 539 | ||||
Proceeds from sale of common stock, shares | 98,182 | ||||||
Net loss | (308) | (308) | |||||
Balance ending at Mar. 31, 2020 | $ 29 | 39,532 | (31,918) | (152) | 7,491 | ||
Balance ending, shares at Mar. 31, 2020 | 2,951,353 | ||||||
Balance beginning at Dec. 31, 2019 | $ 28 | 38,994 | (31,610) | (205) | 7,207 | ||
Balance beginning, shares at Dec. 31, 2019 | 2,853,171 | ||||||
Net loss | (1,151) | ||||||
Balance ending at Sep. 30, 2020 | $ 29 | 46,532 | (32,761) | (116) | 13,684 | ||
Balance ending, shares at Sep. 30, 2020 | 280 | 2,951,353 | |||||
Balance beginning at Mar. 31, 2020 | $ 29 | 39,532 | (31,918) | (152) | 7,491 | ||
Balance beginning, shares at Mar. 31, 2020 | 2,951,353 | ||||||
Net change in unrealized loss (gain) on securities available for sale, net of income taxes | 15 | 15 | |||||
Amortization of unrealized loss on debt securities transferred to held-to-maturity, net of income taxes | 18 | 18 | |||||
Proceeds from the sale of preferred stock | 2,500 | 2,500 | |||||
Proceeds from the sale of preferred stock , shares | 100 | ||||||
Net loss | (347) | (347) | |||||
Balance ending at Jun. 30, 2020 | $ 29 | 42,032 | (32,265) | (119) | 9,677 | ||
Balance ending, shares at Jun. 30, 2020 | 100 | 2,951,353 | |||||
Net change in unrealized loss (gain) on securities available for sale, net of income taxes | (23) | (23) | |||||
Amortization of unrealized loss on debt securities transferred to held-to-maturity, net of income taxes | 26 | 26 | |||||
Proceeds from the sale of preferred stock | 4,500 | 4,500 | |||||
Proceeds from the sale of preferred stock , shares | 180 | ||||||
Net loss | (496) | (496) | |||||
Balance ending at Sep. 30, 2020 | $ 29 | $ 46,532 | $ (32,761) | $ (116) | $ 13,684 | ||
Balance ending, shares at Sep. 30, 2020 | 280 | 2,951,353 |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Cash flows from operating activities: | ||
Net loss | $ (1,151) | $ (856) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Provision for loan losses | 1,236 | 45 |
Depreciation and amortization | 132 | 132 |
Stock-based compensation | 200 | 201 |
Net amortization of fees, premiums and discounts | (27) | 153 |
Increase in accrued interest receivable | (1,112) | (40) |
Amortization of right-of-use operating lease assets | 113 | 52 |
Net decrease in operating lease liabilities | (103) | (49) |
Increase in other assets | (270) | (614) |
Decrease in official checks and other liabilities | (1,063) | (117) |
Net cash used in operating activities | (2,045) | (1,093) |
Cash flows from investing activities: | ||
Purchase of debt securities available for sale | (3,638) | (4,153) |
Principal repayments of debt securities available for sale | 1,585 | 676 |
Principal repayments of debt securities held-to-maturity | 1,276 | 977 |
Net increase in loans | (44,109) | (14,990) |
Purchases of premises and equipment | (165) | (217) |
(Purchase) redemption of FHLB stock | (450) | 490 |
Net cash used in investing activities | (45,501) | (17,217) |
Cash flows from financing activities: | ||
Net increase in deposits | 66,344 | 30,887 |
Net decrease in federal funds purchased | (560) | |
Net increase (decrease) in Federal Home Loan Bank advances | 10,000 | (11,600) |
Proceeds from sale of common stock | 539 | |
Proceeds from sale of preferred stock | 7,000 | |
Net cash provided by financing activities | 83,883 | 18,727 |
Net increase in cash and cash equivalents | 36,337 | 417 |
Cash and cash equivalents at beginning of the period | 8,934 | 7,983 |
Cash and cash equivalents at end of the period | 45,271 | 8,400 |
Supplemental disclosure of cash flow information: | ||
Interest | 2,354 | 1,249 |
Income taxes | ||
Noncash transaction - | ||
Change in accumulated other comprehensive loss, net change in unrealized gain on debt securities available for sale, net of income taxes | 89 | 110 |
Amortization of unrealized loss on debt securities transferred to held-to-maturity | 83 | 67 |
Common stock issued and reclassified from other liabilities | 31 | |
Right-of use lease assets obtained in exchange for operating lease liabilities | 1,144 | |
Transfer of loan to foreclosed real estate | $ 681 |
General
General | 9 Months Ended |
Sep. 30, 2020 | |
Accounting Policies [Abstract] | |
General | (1) General. Basis of Presentation Subsequent Events. Junior Subordinated Debenture. The Trust utilized the proceeds of $5,155,000 to purchase a junior subordinated debenture from the Company (the “Junior Subordinated Debenture”). Under the Junior Subordinated Debenture, the Company is required to make interest payments on a periodic basis and to pay the outstanding principal amount plus accrued interest on October 7, 2034. In May 2018, Preferred Shares, LLC (the “Purchaser”) acquired all 5,000 of the Trust Preferred Securities from a third party. The Purchaser is an affiliate of a director of the Company. The Purchaser has subsequently sold and/or transferred 2,575 of the Trust Preferred Securities to unaffiliated third parties. During 2019 and 2018, the Company issued 1,226,173 shares of the Company’s common stock in exchange for 2,575 Trust Preferred Securities. For accounting purposes, the Trust Preferred Securities acquired by the Company were deemed to be cancelled. As a result, the Company cancelled $2,575,000 in principal amount of the Trust Preferred Securities, together with accrued interest of $974,000, and increased its stockholders’ equity by the same amount. The remaining principal owed by the Company in connection with the Junior Subordinated Debenture was $2,580,000 at September 30, 2020 and December 31, 2019, respectively. The Company has been in default under the Junior Subordinated Debenture due to the failure to pay interest since 2015. In September 2020, the Company paid approximately $1.1 million to the holders of the outstanding Trust Preferred Securities, which represented all accrued interest owed under the Junior Subordinated Debenture attributable to the Trust Preferred Securities that had not been cancelled. The accrued interest owed by the Company associated with the Junior Subordinated Debenture was $0 and $995,000 at September 30, 2020 and December 31, 2019 respectively. The accrued interest at December 31, 2019 is presented on the accompanying condensed consolidated balance sheet under the caption “Other liabilities”. Comprehensive Loss. Accumulated other comprehensive loss consists of the following (in thousands): September 30, December 31, 2020 2019 Unrealized gain on debt securities available for sale $ 47 $ 11 Unamortized portion of unrealized loss related to debt securities available for sale transferred to securities held-to-maturity (201 ) (284 ) Income tax benefit 38 68 $ (116 ) $ (205 ) Income Taxes. In June 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-13 Financial Instruments-Credit Losses (Topic 326) In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820) - Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement ("ASU 2018-13"). |
Debt Securities
Debt Securities | 9 Months Ended |
Sep. 30, 2020 | |
Investments, Debt and Equity Securities [Abstract] | |
Debt Securities | (2) Debt Securities Gross Gross Amortized Unrealized Unrealized Fair Cost Gains Losses Value At September 30, 2020: Held-to-maturity: Collateralized mortgage obligations $ 3,208 $ 168 $ — $ 3,376 Mortgage-backed securities 1,363 55 — 1,418 Total $ 4,571 $ 223 $ - $ 4,794 Available for sale: SBA Pool Securities $ 1,364 $ — $ (43 ) $ 1,321 Collateralized mortgage obligations 582 35 — 617 Mortgage-backed securities 5,467 55 — 5,522 Total $ 7,413 $ 90 $ (43 ) $ 7,460 At December 31, 2019: Held-to-maturity: Collateralized mortgage obligations $ 4,218 $ 129 — $ 4,347 Mortgage-backed securities 1,588 51 — 1,639 Total $ 5,806 $ 180 — $ 5,986 Available for sale: SBA Pool Securities $ 1,734 $ — $ (52 ) $ 1,682 Collateralized mortgage obligations 998 18 — 1,016 Mortgage-backed securities 2,666 45 — 2,711 Total $ 5,398 $ 63 $ (52 ) $ 5,409 There were no sales of debt securities during the three and nine months ended September 30, 2020 and 2019. Debt Securities available for sale with gross unrealized losses, aggregated by investment category and length of time that individual debt securities have been in a continuous loss position, is as follows (in thousands): Over Twelve Less Than Twelve Months Months Gross Gross Unrealized Fair Unrealized Fair Losses Value Losses Value At September 30, 2020- Available for Sale - SBA Pool securities $ 43 $ 1,321 $ — $ — At December 31, 2019- Available for Sale - SBA Pool Securities $ 52 $ 1,682 $ — $ — Management evaluates debt securities for other-than-temporary impairment at least on a quarterly basis, and more frequently when economic or market concerns warrant such evaluation. Consideration is given to (1) the length of time and the extent to which the fair value has been less than cost, (2) the financial condition and near-term prospectus of the issuer, and (3) the intent and ability of the Company to retain its investment in the issuer for a period of time sufficient to allow for any anticipated recovery in fair value. At September 30, 2020 and December 31, 2019, the unrealized losses on six debt securities, were caused by market conditions. It is expected that the debt securities would not be settled at a price less than the book value of the investments. Because the decline in fair value is attributable to market conditions and not credit quality, and because the Company has the ability and intent to hold these investments until a market price recovery or maturity, these investments are not considered other-than-temporarily impaired. |
Loans
Loans | 9 Months Ended |
Sep. 30, 2020 | |
Receivables [Abstract] | |
Loans | (3) Loans. At At September 30, December 31, Residential real estate $ 32,094 $ 28,266 Multi-family real estate 16,052 8,396 Commercial real estate 67,060 55,652 Land and construction 4,332 2,496 Commercial 22,611 4,476 Consumer 5,080 4,903 Total loans 147,229 104,189 Net deferred (loan fees), costs and premiums (552 ) 53 Allowance for loan losses (2,145 ) (2,009 ) Loans, net $ 144,532 $ 102,233 An analysis of the change in the allowance for loan losses follows (in thousands): Residential Multi- Commercial Land and Estate Estate Real Estate Construction Commercial Consumer Unallocated Total Three Months Ended September 30, 2020: Beginning balance $ 717 $ 153 $ 888 $ 50 $ 620 $ 236 $ — $ 2,664 Provision (credit) for loan losses 85 75 84 (5 ) 292 (7 ) — 524 Charge-offs (259 ) — — — (775 ) (17 ) — (1,051 ) Recoveries 1 — — 6 — 1 — 8 Ending balance $ 544 $ 228 $ 972 $ 51 $ 137 $ 213 $ — $ 2,145 Three Months Ended September 30, 2019: Beginning balance $ 537 $ 41 $ 658 $ 7 $ 558 $ 11 $ 241 $ 2,053 Provision (credit) for loan losses (5 ) — 87 7 32 165 (241 ) 45 Charge-offs — — — — — — — — Recoveries — — — 6 — — — 6 Ending balance $ 532 $ 41 $ 745 $ 20 $ 590 $ 176 $ — $ 2,104 Nine Months Ended September 30, 2020: Beginning balance $ 531 $ 82 $ 624 $ 21 $ 573 $ 152 $ 26 $ 2,009 Provision (credit) for loan losses 264 146 348 12 339 153 (26 ) 1,236 Charge-offs (259 ) — — — (775 ) (94 ) — (1,128 ) Recoveries 8 — — 18 — 2 — 28 Ending balance $ 544 $ 228 $ 972 $ 51 $ 137 $ 213 $ - $ 2,145 Nine Months Ended September 30, 2019: Beginning balance $ 544 $ 88 $ 545 $ 37 $ 850 $ 25 $ 154 $ 2,243 (Credit) provision for loan losses (12 ) (47 ) 395 (35 ) (260 ) 158 (154 ) 45 Charge-offs — — (195 ) — — (7 ) — (202 ) Recoveries — — — 18 — — — 18 Ending balance $ 532 $ 41 $ 745 $ 20 $ 590 $ 176 $ — $ 2,104 Residential Multi- Family Commercial Real Estate Land and Construction Commercial Consumer Unallocated Total At September 30, 2020: Individually evaluated for impairment: Recorded investment $ — $ — $ 2,193 $ — $ — $ — $ — $ 2,193 Balance in allowance for loan losses $ — $ — $ — $ — $ — $ — $ — $ — Collectively evaluated for impairment: Recorded investment $ 32,094 $ 16,052 $ 64,867 $ 4,332 $ 22,611 $ 5,080 $ — $ 145,036 Balance in allowance for loan losses $ 544 $ 228 $ 972 $ 51 $ 137 $ 213 $ — $ 2,145 At December 31, 2019: Individually evaluated for impairment: Recorded investment $ 944 $ — $ 2,206 $ — $ 812 $ — $ — $ 3,962 Balance in allowance for loan losses $ 258 $ — $ — $ — $ 531 $ — $ — $ 789 Collectively evaluated for impairment: Recorded investment $ 27,322 $ 8,396 $ 53,446 $ 2,496 $ 3,664 $ 4,903 $ — $ 100,227 Balance in allowance for loan losses $ 273 $ 82 $ 624 $ 21 $ 42 $ 152 $ 26 $ 1,220 The Company has divided the loan portfolio into six portfolio segments, each with different risk characteristics and methodologies for assessing risk. All loans are underwritten based upon standards set forth in the policies approved by the Company’s Board of Directors (the “Board”). The Company identifies the portfolio segments as follows: Residential Real Estate, Multi-Family Real Estate, Commercial Real Estate, Land and Construction. Commercial. Consumer. The following summarizes the loan credit quality (in thousands): Pass OLEM Sub- Doubtful Loss Total At September 30, 2020: Residential real estate $ 32,094 $ — $ — $ — $ — $ 32,094 Multi-family real estate 16,052 — — — — 16,052 Commercial real estate 63,055 1,812 2,193 — — 67,060 Land and construction 2,716 1,616 — — — 4,332 Commercial 22,073 538 — — — 22,611 Consumer 5,053 — 27 — — 5,080 Total $ 141,043 $ 3,966 $ 2,220 $ — $ — $ 147,229 — — At December 31, 2019: — — Residential real estate $ 27,322 $ — $ 944 $ — $ — $ 28,266 Multi-family real estate 8,396 — — — — 8,396 Commercial real estate 53,011 435 2,206 — — 55,652 Land and construction 1,261 1,235 — — — 2,496 Commercial 3,027 637 812 — — 4,476 Consumer 4,903 — — — — 4,903 Total $ 97,920 $ 2,307 $ 3,962 $ — $ — $ 104,189 Internally assigned loan grades are defined as follows: Pass – a Pass loan’s primary source of loan repayment is satisfactory, with secondary sources very likely to be realized if necessary. These are loans that conform in all aspects to bank policy and regulatory requirements, and no repayment risk has been identified. OLEM – an Other Loan Especially Mentioned has potential weaknesses that deserve management’s close attention. If left uncorrected, these potential weaknesses may result in the deterioration of the repayment prospects for the asset or the Company’s credit position at some future date. Substandard – a Substandard loan is inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged, if any. Loans so classified must have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. Included in this category are loans that are current on their payments, but the Bank is unable to document the source of repayment. They are characterized by the distinct possibility that the Company will sustain some loss if the deficiencies are not corrected. Doubtful – a loan classified as Doubtful has all the weaknesses inherent in one classified as Substandard, with the added characteristics that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions, and values, highly questionable and improbable. This classification does not mean that the asset has absolutely no recovery or salvage value, but rather it is not practical or desirable to defer writing off this basically worthless asset even though partial recovery may be affected in the future. The Company charges off any loan classified as Doubtful. Loss – a loan classified Loss is considered uncollectible and of such little value that continuance as a bankable asset is not warranted. This classification does not mean that the asset has absolutely no recovery or salvage value, but rather it is not practical or desirable to defer writing off this basically worthless asset even though partial recovery may be effected in the future. The Company fully charges off any loan classified as Loss. Age analysis of past-due loans is as follows (in thousands): Accruing Loans 30-59 60-89 Greater Total Current Nonaccrual Total At September 30, 2020: Residential real estate $ — $ — $ — $ — $ 32,094 $ — $ 32,094 Multi-family real estate — — — — 16,052 — 16,052 Commercial real estate — — — — 67,060 — 67,060 Land and construction — — — — 4,332 — 4,332 Commercial — — — — 22,611 — 22,611 Consumer 14 13 — 27 5,053 — 5,080 Total $ 14 $ 13 $ — $ 27 $ 147,202 $ — $ 147,229 Accruing Loans Greater 30-59 60-89 Than 90 Days Days Days Total Nonaccrual Total Past Due Past Due Past Due Past Due Current Loans Loans At December 31, 2019: Residential real estate $ 944 $ — $ — $ 944 $ 27,322 $ — $ 28,266 Multi-family real estate — — — — 8,396 — 8,396 Commercial real estate — — — — 55,652 — 55,652 Land and construction 1,235 — — 1,235 1,261 — 2,496 Commercial — — — — 3,664 812 4,476 Consumer — — — — 4,903 — 4,903 Total $ 2,179 $ — $ — $ 2,179 $ 101,198 $ 812 $ 104,189 The following summarizes the amount of impaired loans (in thousands): At September 30, 2020 At December 31, 2019 Recorded Unpaid Related Recorded Unpaid Related Allowance With no related allowance recorded- Commercial real estate $ 2,193 $ 2,193 $ — $ 2,206 $ 2,206 — With related allowance recorded: Residential real estate — — — 944 944 258 Commercial — — — 812 812 531 Total: Residential real estate $ — $ — $ — $ 944 944 258 Commercial real estate $ 2,193 $ 2,193 $ — $ 2,206 2,206 — Commercial $ — $ — $ — $ 812 $ 812 $ 531 Total $ 2,193 $ 2,193 $ — $ 3,962 $ 3,962 $ 789 The average net investment in impaired loans and interest income recognized and received on impaired loans are as follows (in thousands): Three Months Ended September 30, 2020 2019 Average Interest Interest Average Interest Interest Recorded Income Income Recorded Income Income Investment Recognized Received Investment Recognized Received Residential real estate $ 626 $ — $ — $ 950 $ 19 $ 19 Commercial real estate $ 2,193 $ 26 $ — $ 2,280 $ 27 $ 27 Commercial $ 270 $ — $ — $ 812 $ — $ — Total $ 3,089 $ 26 $ — $ 4,042 $ 46 $ 46 Nine Months Ended September 30, 2020 2019 Average Interest Interest Average Interest Interest Recorded Income Income Recorded Income Income Investment Recognized Received Investment Recognized Received Residential real estate $ 846 $ 18 $ 11 $ 950 $ 56 $ 56 Commercial real estate $ 2,194 $ 78 $ 60 $ 2,808 $ 88 $ 86 Commercial $ 649 $ — $ 18 $ 1,327 43 $ 39 Total $ 3,689 $ 96 $ 89 $ 5,085 $ 187 $ 181 No loans have been determined to be troubled debt restructurings (TDR’s) during the three and nine month periods ended September 30, 2020 or 2019. At September 30, 2020 and 2019, there were no loans modified and entered into TDR’s within the past twelve months, that subsequently defaulted during the three and nine month periods ended September 30, 2020 or 2019. |
Loss Per Share
Loss Per Share | 9 Months Ended |
Sep. 30, 2020 | |
Earnings Per Share [Abstract] | |
Loss Per Share | (4) Loss Per Share. Three Months Ended Nine Months Ended September 30, September 30, 2020 2019 2020 2019 Weighted-average number of common shares outstanding used to calculate basic and diluted loss per common share 2,951,353 1,928,269 2,920,961 1,889,592 |
Stock-Based Compensation
Stock-Based Compensation | 9 Months Ended |
Sep. 30, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Stock-Based Compensation | (5) Stock-Based Compensation The Company is authorized to grant stock options, stock grants and other forms of equity-based compensation under its 2018 Equity Incentive Plan (the “2018 Plan”). The plan has been approved by the shareholders. The Company is currently authorized to issue up to 550,000 shares of common stock under the 2018 Plan, due to an amendment to increase the number of authorized shares from 250,000 to 550,000 that was approved by shareholders in August 2020. At September 30, 2020, 318,184 shares remain available for grant. During the second quarter of 2019, the Company recorded compensation expense of $201,000 with respect to 58,309 shares issued to a director for services performed. During the third quarter of 2020, the Company agreed to issue 74,626 shares to this director for services performed and recorded compensation expense of $200,000. The director has not yet taken delivery of the shares. As such, at September 30, 2020, the $200,000 is presented on the accompanying condensed consolidated balance sheet under the caption “other liabilities”. |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | (6) Fair Value Measurements. Fair Value Level 1 Level 2 Level 3 Total Losses Losses Recorded Operations December 31, 2019 At December 31, 2019— Residential real estate $ 686 $ — $ — $ 686 $ 258 $ — Foreclosed real estate is recorded at fair value less selling costs. Foreclosed real estate which is measured at fair value on a nonrecurring basis is as follows (in thousands): Fair Level 1 Level 2 Level 3 Total Losses Recorded Operations September 30, 2020 At September 30, 2020— Foreclosed real estate $ 681 $ — $ — $ 681 $ — $ — Debt securities available for sale measured at fair value on a recurring basis are summarized below (in thousands): Fair Value Measurements Using Quoted Prices Significant Significant Fair Value (Level 1) (Level 2) (Level 3) At September 30, 2020: SBA Pool Securities $ 1,321 $ — $ 1,321 $ — Collateralized mortgage obligations 617 — 617 — Mortgage-backed securities 5,522 — 5,522 — $ 7,460 — 7,460 — At December 31, 2019: SBA Pool Securities $ 1,682 $ — $ 1,682 $ — Collateralized mortgage obligations 1,016 — 1,016 — Mortgage-backed securities 2,711 — 2,711 — Total $ 5,409 — $ 5,409 $ — During the three and nine month periods ended September 30, 2020 and 2019, no debt securities were transferred in or out of Levels 1, 2 or 3. |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 9 Months Ended |
Sep. 30, 2020 | |
Investments, All Other Investments [Abstract] | |
Fair Value of Financial Instruments | (7) Fair Value of Financial Instruments. At September 30, 2020 At December 31, 2019 Carrying Fair Value Level Carrying Fair Value Level Financial assets: Cash and cash equivalents $ 45,271 $ 45,271 1 $ 8,934 $ 8,934 1 Debt securities available for sale 7,460 7,460 2 5,409 5,409 2 Debt securities held-to-maturity 4,571 4,794 2 5,806 5,986 2 Loans 144,532 144,641 3 102,233 102,060 3 Federal Home Loan Bank stock 1,092 1,092 3 642 642 3 Accrued interest receivable 1,544 1,544 3 432 432 3 Financial liabilities: Deposit liabilities 167,716 168,003 3 101,372 101,256 3 Federal Home Loan Bank advances 23,000 23,311 3 13,000 13,137 3 Junior subordinated debenture 2,580 N/A (1) N/A 2,580 N/A (1) N/A Off-balance sheet financial instruments — — 3 — — 3 (1) The Company is unable to determine value based on significant unobservable inputs required in the calculation. Refer to Note 1 for further information. |
Off- Balance Sheet Financial In
Off- Balance Sheet Financial Instruments | 9 Months Ended |
Sep. 30, 2020 | |
Off- Balance Sheet Financial Instruments | |
Off- Balance Sheet Financial Instruments | (8) Off- Balance Sheet Financial Instruments. The Company’s exposure to credit loss in the event of nonperformance by the other party to the financial instrument for commitments to extend credit is represented by the contractual amount of those instruments. The Company uses the same credit policies in making commitments as it does for on-balance-sheet instruments. Commitments to extend credit are agreements to lend to a customer as long as there is no violation of any condition established in the contract. Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. Because some of the commitments are expected to expire without being drawn upon, the total commitment amounts do not necessarily represent future cash requirements. The Company evaluates each customer’s credit worthiness on a case-by-case basis. The amount of collateral obtained, if deemed necessary by the Company, upon extension of credit, is based on management’s credit evaluation of the counterparty. Standby letters of credit are conditional commitments issued by the Bank to guarantee the performance of a customer to a third party. The credit risk involved in issuing letters of credit to customers is essentially the same as that involved in extending loan facilities to customers. The Bank generally holds collateral supporting those commitments. Standby letters of credit generally have expiration dates within one year. Commitments to extend credit, unused lines of credit, and standby letters of credit typically result in loans with a market interest rate when funded. A summary of the contractual amounts of the Company’s financial instruments with off-balance-sheet risk at September 30, 2020 follows (in thousands): Commitments to extend credit $ 4,091 Unused lines of credit $ 5,332 Standby letters of credit $ 4,550 |
Regulatory Matters
Regulatory Matters | 9 Months Ended |
Sep. 30, 2020 | |
Line of Credit Facility [Abstract] | |
Regulatory Matters | (9) Regulatory Matters. The Bank, is subject to the Basel III capital level threshold requirements under the Prompt Corrective Action regulations with full compliance phased in over a multi-year schedule. These new regulations were designed to ensure that banks maintain strong capital positions even in the event of severe economic downturns or unforeseen losses. Regulatory banking agencies issued final rules on October 29, 2019 that provide simplified capital measures, including a simplified measure of capital adequacy for qualifying community banking organizations consistent with section 201 of the Economic Growth, Regulatory Relief, and Consumer Protection Act. Qualifying community banking organizations with less than $10 billion of assets that comply with, and elect to use, the community bank leverage ratio (“CBLR”) and that maintain a CBLR greater than 8% in 2020 would be considered to be “well-capitalized” and would no longer be subject to the other generally applicable capital rules. The CBLR would be used and applied for purposes of compliance with the Federal Banking Agencies ‘prompt corrective action rules, and Federal Reserve Regulation O and W compliance, as well as in calculating FDIC deposit insurance assessments. The CBLR, among other proposals, reflects the regulatory banking agencies’ focus on appropriately tailoring capital requirements to an institution’s size, complexity and risk profile. The CBLR was first available for banking organizations to use in their March 31, 2020 Call Report. Non-advanced approaches banking organizations will also be able to take advantage of simpler regulatory capital requirements for mortgage servicing assets, certain deferred tax assets arising from temporary differences and investments in unconsolidated financial institutions. As of September 30, 2020, the Company has determined to opt in to adopting the new CBLR. The following table shows the Bank’s capital amounts and ratios and regulatory thresholds at September 30, 2020 and December 31, 2019 (dollars in thousands): Actual For Capital Purposes Minimum To Be Amount % Amount % Amount % As of September 30, 2020— Tier I Capital to Total Assets 16,175 8.70 % $ 7,434 4.00 % $ 9,292 5.00 % As of December 31, 2019: Total Capital to Risk-Weighted Assets $ 12,212 12.03 % $ 8,124 8.00 % $ 10,154 10.00 % Tier I Capital to Risk-Weighted Assets 10,934 10.77 6,093 6.00 % 8,124 8.00 % Common equity Tier I capital to Risk-Weighted Assets 10,934 10.77 4,569 4.50 % 6,600 6.50 % Tier I Capital to Total Assets 10,934 8.73 5,010 4.00 % 6,263 5.00 % |
Preferred Stock
Preferred Stock | 9 Months Ended |
Sep. 30, 2020 | |
Equity [Abstract] | |
Preferred Stock | (10) Preferred Stock During 2020, the Company issued 280 shares of Series B Participating Preferred Stock (the “Series B Preferred Stock”) to a related party at a cash price of share, with an had 9.9% shares securities. The liquidation price is the greater of $25,000 per share of preferred stock or such amount per share of preferred stock that would have been payable had all shares of the preferred stock been converted into common stock per the terms of the Certificate of Designation immediately prior to a liquidation. The Preferred Stock generally has no votin g rights except as provided in the Certificate of Designation. |
Contingency
Contingency | 9 Months Ended |
Sep. 30, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Contingency | (11) Contingency The Coronavirus global pandemic (“COVID-19”) has negatively impacted the global economy, disrupted global supply chains, lowered equity market valuations, created significant volatility and disruption in financial markets and significantly increased unemployment levels. The extent to which the COVID-19 pandemic impacts our business, results of operations, and financial condition, as well as our regulatory capital and liquidity ratios, will depend on future developments, the duration of the pandemic, and actions taken by governmental authorities to slow the spread of the disease or to mitigate its effects. The Company took action to prepare its employees, support its clients, and help its communities. The Company has supported small business owners by making loans through the Small Business Administration Paycheck Protection Program (“PPP”). As of September 30, 2020, the Bank had originated 204 PPP loans for a total dollar amount of $19.2 million. These loans are 100% guaranteed by the Small Business Administration (the “SBA”). The Company has the option to fund PPP loans through the Federal Reserve Bank’s Paycheck Protection Program Liquidity Facility (the “PPPLF”). Loans pledged to secure PPPLF advances will be excluded from the calculations of the Bank’s regulatory capital ratios. At September 30, 2020, there were no outstanding borrowings under the PPPLF. |
General (Policies)
General (Policies) | 9 Months Ended |
Sep. 30, 2020 | |
Accounting Policies [Abstract] | |
General | General. |
Basis of Presentation | Basis of Presentation |
Subsequent Events | Subsequent Events. The Company has evaluated subsequent events through November XX, 2020, which is the date the condensed consolidated financial statements were issued, determining no additional events required disclosure. |
Junior Subordinated Debenture | Junior Subordinated Debenture. The Trust utilized the proceeds of $5,155,000 to purchase a junior subordinated debenture from the Company (the “Junior Subordinated Debenture”). Under the Junior Subordinated Debenture, the Company is required to make interest payments on a periodic basis and to pay the outstanding principal amount plus accrued interest on October 7, 2034. In May 2018, Preferred Shares, LLC (the “Purchaser”) acquired all 5,000 of the Trust Preferred Securities from a third party. The Purchaser is an affiliate of a director of the Company. The Purchaser has subsequently sold and/or transferred 2,575 of the Trust Preferred Securities to unaffiliated third parties. During 2019 and 2018, the Company issued 1,226,173 shares of the Company’s common stock in exchange for 2,575 Trust Preferred Securities. For accounting purposes, the Trust Preferred Securities acquired by the Company were deemed to be cancelled. As a result, the Company cancelled $2,575,000 in principal amount of the Trust Preferred Securities, together with accrued interest of $974,000, and increased its stockholders’ equity by the same amount. The remaining principal owed by the Company in connection with the Junior Subordinated Debenture was $2,580,000 at September 30, 2020 and December 31, 2019, respectively. The Company has been in default under the Junior Subordinated Debenture due to the failure to pay interest since 2015. In September 2020, the Company paid approximately $1.1 million to the holders of the outstanding Trust Preferred Securities, which represented all accrued interest owed under the Junior Subordinated Debenture attributable to the Trust Preferred Securities that had not been cancelled. The accrued interest owed by the Company associated with the Junior Subordinated Debenture was $0 and $995,000 at September 30, 2020 and December 31, 2019 respectively. The accrued interest at December 31, 2019 is presented on the accompanying condensed consolidated balance sheet under the caption “Other liabilities”. |
Comprehensive Loss | Comprehensive Loss. Accumulated other comprehensive loss consists of the following (in thousands): September 30, December 31, 2020 2019 Unrealized gain on debt securities available for sale $ 47 $ 11 Unamortized portion of unrealized loss related to debt securities available for sale transferred to securities held-to-maturity (201 ) (284 ) Income tax benefit 38 68 $ (116 ) $ (205 ) |
Income Taxes | Income Taxes. In June 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-13 Financial Instruments-Credit Losses (Topic 326) In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820) - Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement ("ASU 2018-13"). |
General (Tables)
General (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Accounting Policies [Abstract] | |
Schedule of Accumulated Other Comprehensive Loss | Accumulated other comprehensive loss consists of the following (in thousands): September 30, December 31, 2020 2019 Unrealized gain on debt securities available for sale $ 47 $ 11 Unamortized portion of unrealized loss related to debt securities available for sale transferred to securities held-to-maturity (201 ) (284 ) Income tax benefit 38 68 $ (116 ) $ (205 ) |
Debt Securities (Tables)
Debt Securities (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Investments, Debt and Equity Securities [Abstract] | |
Schedule of Amortized Cost and Approximate Fair Values of Debt Securities | The carrying amount of debt securities and approximate fair values are as follows (in thousands): Gross Gross Amortized Unrealized Unrealized Fair Cost Gains Losses Value At September 30, 2020: Held-to-maturity: Collateralized mortgage obligations $ 3,208 $ 168 $ — $ 3,376 Mortgage-backed securities 1,363 55 — 1,418 Total $ 4,571 $ 223 $ - $ 4,794 Available for sale: SBA Pool Securities $ 1,364 $ — $ (43 ) $ 1,321 Collateralized mortgage obligations 582 35 — 617 Mortgage-backed securities 5,467 55 — 5,522 Total $ 7,413 $ 90 $ (43 ) $ 7,460 Gross Gross Amortized Unrealized Unrealized Fair Cost Gains Losses Value At December 31, 2019: Held-to-maturity: Collateralized mortgage obligations $ 4,218 $ 129 — $ 4,347 Mortgage-backed securities 1,588 51 — 1,639 Total $ 5,806 $ 180 — $ 5,986 Available for sale: SBA Pool Securities $ 1,734 $ — $ (52 ) $ 1,682 Collateralized mortgage obligations 998 18 — 1,016 Mortgage-backed securities 2,666 45 — 2,711 Total $ 5,398 $ 63 $ (52 ) $ 5,409 |
Schedule of Debt Securities with Gross Unrealized Losses, by Investment Category | Debt Securities available for sale with gross unrealized losses, aggregated by investment category and length of time that individual debt securities have been in a continuous loss position, is as follows (in thousands): Over Twelve Less Than Twelve Months Months Gross Gross Unrealized Fair Unrealized Fair Losses Value Losses Value At September 30, 2020- Available for Sale - SBA Pool securities $ 43 $ 1,321 $ — $ — At December 31, 2019- Available for Sale - SBA Pool Securities $ 52 $ 1,682 $ — $ — |
Loans (Tables)
Loans (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Receivables [Abstract] | |
Schedule of Components of Loans | At At September 30, December 31, Residential real estate $ 32,094 $ 28,266 Multi-family real estate 16,052 8,396 Commercial real estate 67,060 55,652 Land and construction 4,332 2,496 Commercial 22,611 4,476 Consumer 5,080 4,903 Total loans 147,229 104,189 Net deferred (loan fees), costs and premiums (552 ) 53 Allowance for loan losses (2,145 ) (2,009 ) Loans, net $ 144,532 $ 102,233 |
Schedule of Change in Allowance for Loan Losses | An analysis of the change in the allowance for loan losses follows (in thousands): Residential Multi- Commercial Land and Estate Estate Real Estate Construction Commercial Consumer Unallocated Total Three Months Ended September 30, 2020: Beginning balance $ 717 $ 153 $ 888 $ 50 $ 620 $ 236 $ — $ 2,664 Provision (credit) for loan losses 85 75 84 (5 ) 292 (7 ) — 524 Charge-offs (259 ) — — — (775 ) (17 ) — (1,051 ) Recoveries 1 — — 6 — 1 — 8 Ending balance $ 544 $ 228 $ 972 $ 51 $ 137 $ 213 $ — $ 2,145 Three Months Ended September 30, 2019: Beginning balance $ 537 $ 41 $ 658 $ 7 $ 558 $ 11 $ 241 $ 2,053 Provision (credit) for loan losses (5 ) — 87 7 32 165 (241 ) 45 Charge-offs — — — — — — — — Recoveries — — — 6 — — — 6 Ending balance $ 532 $ 41 $ 745 $ 20 $ 590 $ 176 $ — $ 2,104 Nine Months Ended September 30, 2020: Beginning balance $ 531 $ 82 $ 624 $ 21 $ 573 $ 152 $ 26 $ 2,009 Provision (credit) for loan losses 264 146 348 12 339 153 (26 ) 1,236 Charge-offs (259 ) — — — (775 ) (94 ) — (1,128 ) Recoveries 8 — — 18 — 2 — 28 Ending balance $ 544 $ 228 $ 972 $ 51 $ 137 $ 213 $ - $ 2,145 Nine Months Ended September 30, 2019: Beginning balance $ 544 $ 88 $ 545 $ 37 $ 850 $ 25 $ 154 $ 2,243 (Credit) provision for loan losses (12 ) (47 ) 395 (35 ) (260 ) 158 (154 ) 45 Charge-offs — — (195 ) — — (7 ) — (202 ) Recoveries — — — 18 — — — 18 Ending balance $ 532 $ 41 $ 745 $ 20 $ 590 $ 176 $ — $ 2,104 Residential Multi- Family Commercial Real Estate Land and Construction Commercial Consumer Unallocated Total At September 30, 2020: Individually evaluated for impairment: Recorded investment $ — $ — $ 2,193 $ — $ — $ — $ — $ 2,193 Balance in allowance for loan losses $ — $ — $ — $ — $ — $ — $ — $ — Collectively evaluated for impairment: Recorded investment $ 32,094 $ 16,052 $ 64,867 $ 4,332 $ 22,611 $ 5,080 $ — $ 145,036 Balance in allowance for loan losses $ 544 $ 228 $ 972 $ 51 $ 137 $ 213 $ — $ 2,145 At December 31, 2019: Individually evaluated for impairment: Recorded investment $ 944 $ — $ 2,206 $ — $ 812 $ — $ — $ 3,962 Balance in allowance for loan losses $ 258 $ — $ — $ — $ 531 $ — $ — $ 789 Collectively evaluated for impairment: Recorded investment $ 27,322 $ 8,396 $ 53,446 $ 2,496 $ 3,664 $ 4,903 $ — $ 100,227 Balance in allowance for loan losses $ 273 $ 82 $ 624 $ 21 $ 42 $ 152 $ 26 $ 1,220 |
Schedule of Loans by Credit Quality | The following summarizes the loan credit quality (in thousands): Pass OLEM Sub- Doubtful Loss Total At September 30, 2020: Residential real estate $ 32,094 $ — $ — $ — $ — $ 32,094 Multi-family real estate 16,052 — — — — 16,052 Commercial real estate 63,055 1,812 2,193 — — 67,060 Land and construction 2,716 1,616 — — — 4,332 Commercial 22,073 538 — — — 22,611 Consumer 5,053 — 27 — — 5,080 Total $ 141,043 $ 3,966 $ 2,220 $ — $ — $ 147,229 — — At December 31, 2019: — — Residential real estate $ 27,322 $ — $ 944 $ — $ — $ 28,266 Multi-family real estate 8,396 — — — — 8,396 Commercial real estate 53,011 435 2,206 — — 55,652 Land and construction 1,261 1,235 — — — 2,496 Commercial 3,027 637 812 — — 4,476 Consumer 4,903 — — — — 4,903 Total $ 97,920 $ 2,307 $ 3,962 $ — $ — $ 104,189 |
Schedule of Age Analysis of Past-due Loans | Age analysis of past-due loans is as follows (in thousands): Accruing Loans 30-59 60-89 Greater Total Current Nonaccrual Total At September 30, 2020: Residential real estate $ — $ — $ — $ — $ 32,094 $ — $ 32,094 Multi-family real estate — — — — 16,052 — 16,052 Commercial real estate — — — — 67,060 — 67,060 Land and construction — — — — 4,332 — 4,332 Commercial — — — — 22,611 — 22,611 Consumer 14 13 — 27 5,053 — 5,080 Total $ 14 $ 13 $ — $ 27 $ 147,202 $ — $ 147,229 Accruing Loans Greater 30-59 60-89 Than 90 Days Days Days Total Nonaccrual Total Past Due Past Due Past Due Past Due Current Loans Loans At December 31, 2019: Residential real estate $ 944 $ — $ — $ 944 $ 27,322 $ — $ 28,266 Multi-family real estate — — — — 8,396 — 8,396 Commercial real estate — — — — 55,652 — 55,652 Land and construction 1,235 — — 1,235 1,261 — 2,496 Commercial — — — — 3,664 812 4,476 Consumer — — — — 4,903 — 4,903 Total $ 2,179 $ — $ — $ 2,179 $ 101,198 $ 812 $ 104,189 |
Schedule of Impaired Loans | The following summarizes the amount of impaired loans (in thousands): At September 30, 2020 At December 31, 2019 Recorded Unpaid Related Recorded Unpaid Related Allowance With no related allowance recorded- Commercial real estate $ 2,193 $ 2,193 $ — $ 2,206 $ 2,206 — With related allowance recorded: Residential real estate — — — 944 944 258 Commercial — — — 812 812 531 Total: Residential real estate $ — $ — $ — $ 944 944 258 Commercial real estate $ 2,193 $ 2,193 $ — $ 2,206 2,206 — Commercial $ — $ — $ — $ 812 $ 812 $ 531 Total $ 2,193 $ 2,193 $ — $ 3,962 $ 3,962 $ 789 |
Schedule of Interest Income Recognized and Received on Impaired Loans | The average net investment in impaired loans and interest income recognized and received on impaired loans are as follows (in thousands): Three Months Ended September 30, 2020 2019 Average Interest Interest Average Interest Interest Recorded Income Income Recorded Income Income Investment Recognized Received Investment Recognized Received Residential real estate $ 626 $ — $ — $ 950 $ 19 $ 19 Commercial real estate $ 2,193 $ 26 $ — $ 2,280 $ 27 $ 27 Commercial $ 270 $ — $ — $ 812 $ — $ — Total $ 3,089 $ 26 $ — $ 4,042 $ 46 $ 46 Nine Months Ended September 30, 2020 2019 Average Interest Interest Average Interest Interest Recorded Income Income Recorded Income Income Investment Recognized Received Investment Recognized Received Residential real estate $ 846 $ 18 $ 11 $ 950 $ 56 $ 56 Commercial real estate $ 2,194 $ 78 $ 60 $ 2,808 $ 88 $ 86 Commercial $ 649 $ — $ 18 $ 1,327 43 $ 39 Total $ 3,689 $ 96 $ 89 $ 5,085 $ 187 $ 181 |
Loss Per Share (Tables)
Loss Per Share (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Earnings Per Share [Abstract] | |
Schedule of Weighted Average Number of Common Shares Outstanding | In 2020 and 2019, basic and diluted loss per share are the same due to the net loss incurred by the Company. Loss per common share have been computed based on the following: Three Months Ended Nine Months Ended September 30, September 30, 2020 2019 2020 2019 Weighted-average number of common shares outstanding used to calculate basic and diluted loss per common share 2,951,353 1,928,269 2,920,961 1,889,592 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Fair Value Disclosures [Abstract] | |
Schedule of Assets Measured on Nonrecurring Basis | Fair Value Level 1 Level 2 Level 3 Total Losses Losses Recorded Operations December 31, 2019 At December 31, 2019— Residential real estate $ 686 $ — $ — $ 686 $ 258 $ — Foreclosed real estate is recorded at fair value less selling costs. Foreclosed real estate which is measured at fair value on a nonrecurring basis is as follows (in thousands): Fair Level 1 Level 2 Level 3 Total Losses Recorded Operations September 30, 2020 At September 30, 2020— Foreclosed real estate $ 681 $ — $ — $ 681 $ — $ — |
Schedule of Debt Securities Available-for-sale Measured at Fair Value on Recurring Basis | Debt securities available for sale measured at fair value on a recurring basis are summarized below (in thousands): Fair Value Measurements Using Quoted Prices Significant Significant Fair Value (Level 1) (Level 2) (Level 3) At September 30, 2020: SBA Pool Securities $ 1,321 $ — $ 1,321 $ — Collateralized mortgage obligations 617 — 617 — Mortgage-backed securities 5,522 — 5,522 — $ 7,460 — 7,460 — At December 31, 2019: SBA Pool Securities $ 1,682 $ — $ 1,682 $ — Collateralized mortgage obligations 1,016 — 1,016 — Mortgage-backed securities 2,711 — 2,711 — Total $ 5,409 — $ 5,409 $ — |
Fair Value of Financial Instr_2
Fair Value of Financial Instruments (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Investments, All Other Investments [Abstract] | |
Schedule of Estimated Fair Value of Financial Instruments | The estimated fair values and fair value measurement method with respect to the Company’s financial instruments were as follows (in thousands): At September 30, 2020 At December 31, 2019 Carrying Fair Value Level Carrying Fair Value Level Financial assets: Cash and cash equivalents $ 45,271 $ 45,271 1 $ 8,934 $ 8,934 1 Debt securities available for sale 7,460 7,460 2 5,409 5,409 2 Debt securities held-to-maturity 4,571 4,794 2 5,806 5,986 2 Loans 144,532 144,641 3 102,233 102,060 3 Federal Home Loan Bank stock 1,092 1,092 3 642 642 3 Accrued interest receivable 1,544 1,544 3 432 432 3 Financial liabilities: Deposit liabilities 167,716 168,003 3 101,372 101,256 3 Federal Home Loan Bank advances 23,000 23,311 3 13,000 13,137 3 Junior subordinated debenture 2,580 N/A (1) N/A 2,580 N/A (1) N/A Off-balance sheet financial instruments — — 3 — — 3 (1) The Company is unable to determine value based on significant unobservable inputs required in the calculation. Refer to Note 1 for further information. |
Off- Balance Sheet Financial _2
Off- Balance Sheet Financial Instruments (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Off- Balance Sheet Financial Instruments | |
Schedule of Off-Balance Sheet Risks of Financial Instruments | A summary of the contractual amounts of the Company’s financial instruments with off-balance-sheet risk at September 30, 2020 follows (in thousands): Commitments to extend credit $ 4,091 Unused lines of credit $ 5,332 Standby letters of credit $ 4,550 |
Regulatory Matters (Tables)
Regulatory Matters (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Line of Credit Facility [Abstract] | |
Schedule of Capital Amounts, Ratios and Regulatory Thresholds | The following table shows the Bank’s capital amounts and ratios and regulatory thresholds at September 30, 2020 and December 31, 2019 (dollars in thousands): Actual For Capital Purposes Minimum To Be Amount % Amount % Amount % As of September 30, 2020— Tier I Capital to Total Assets 16,175 8.70 % $ 7,434 4.00 % $ 9,292 5.00 % As of December 31, 2019: Total Capital to Risk-Weighted Assets $ 12,212 12.03 % $ 8,124 8.00 % $ 10,154 10.00 % Tier I Capital to Risk-Weighted Assets 10,934 10.77 6,093 6.00 % 8,124 8.00 % Common equity Tier I capital to Risk-Weighted Assets 10,934 10.77 4,569 4.50 % 6,600 6.50 % Tier I Capital to Total Assets 10,934 8.73 5,010 4.00 % 6,263 5.00 % |
General (Details Narrative)
General (Details Narrative) - USD ($) $ in Thousands | 1 Months Ended | 9 Months Ended | 12 Months Ended | |||
Sep. 30, 2020 | May 31, 2018 | Sep. 30, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2004 | |
Ownership percentage | 100.00% | 100.00% | ||||
Junior subordinated debenture | $ 2,580 | $ 2,580 | $ 2,580 | |||
Number of stock cancelled during the period | 2,575 | $ 2,575 | ||||
Accrued and unpaid interest payable | $ 974 | $ 974 | ||||
Optimum Bank Holdings Capital Trust I [Member] | ||||||
Junior subordinated debenture | $ 5,155 | |||||
Number of trust preferred securities issued | 5,000 | |||||
Number of common trust securities issued | 155 | |||||
Proceeds from issuance of preferred securities | $ 5,155 | |||||
Debt instrument maturity date | Oct. 7, 2034 | |||||
Trust Preferred Securities [Member] | ||||||
Number of shares exchange | 2,575 | 2,575 | ||||
Trust Preferred Securities [Member] | Common Stock [Member] | ||||||
Number of shares exchange | 1,226,173 | 1,226,173 | ||||
Junior Subordinated Debenture [Member] | ||||||
Accrued and unpaid interest payable | 0 | 0 | $ 995 | |||
Debt instrument periodic payment, principal | $ 2,580 | $ 2,580 | ||||
Repayments of interest | $ 1,100 | |||||
Third Party [Member] | ||||||
Number of trust preferred securities issued | 5,000 | |||||
Number of common trust securities issued | 2,575 |
General - Schedule of Accumulat
General - Schedule of Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Accounting Policies [Abstract] | ||
Unrealized gain on debt securities available for sale | $ 47 | $ 11 |
Unamortized portion of unrealized loss related to securities available for sale transferred to securities held-to-maturity | (201) | (284) |
Income tax benefit | 38 | 68 |
Accumulated other comprehensive loss | $ (116) | $ (205) |
Debt Securities (Details Narrat
Debt Securities (Details Narrative) | Sep. 30, 2020USD ($)Number | Dec. 31, 2019USD ($)Number |
Investments, Debt and Equity Securities [Abstract] | ||
Available for sale debt securities | $ | ||
Debt securities in unrealized loss position | Number | 6 | 6 |
Debt Securities - Schedule of A
Debt Securities - Schedule of Amortized Cost and Approximate Fair Values of Debt Securities (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Held-to-maturity, amortized cost | $ 4,571 | $ 5,806 |
Held-to-maturity, gross unrealized gains | 223 | 180 |
Held-to-maturity, gross unrealized losses | ||
Held-to-maturity, fair value | 4,794 | 5,986 |
Available for sale, amortized cost | 7,413 | 5,398 |
Available for sale, gross unrealized gains | 90 | 63 |
Available for sale, gross unrealized losses | (43) | (52) |
Available for sale, fair value | 7,460 | 5,409 |
Collateralized Mortgage Obligations [Member] | ||
Held-to-maturity, amortized cost | 3,208 | 4,218 |
Held-to-maturity, gross unrealized gains | 168 | 129 |
Held-to-maturity, gross unrealized losses | ||
Held-to-maturity, fair value | 3,376 | 4,347 |
Available for sale, amortized cost | 582 | 998 |
Available for sale, gross unrealized gains | 35 | 18 |
Available for sale, gross unrealized losses | ||
Available for sale, fair value | 617 | 1,016 |
Mortgage Backed Securities [Member] | ||
Held-to-maturity, amortized cost | 1,363 | 1,588 |
Held-to-maturity, gross unrealized gains | 55 | 51 |
Held-to-maturity, gross unrealized losses | ||
Held-to-maturity, fair value | 1,418 | 1,639 |
Available for sale, amortized cost | 5,467 | 2,666 |
Available for sale, gross unrealized gains | 55 | 45 |
Available for sale, gross unrealized losses | ||
Available for sale, fair value | 5,522 | 2,711 |
SBA Pool Securities [Member] | ||
Available for sale, amortized cost | 1,364 | 1,734 |
Available for sale, gross unrealized gains | ||
Available for sale, gross unrealized losses | (43) | (52) |
Available for sale, fair value | $ 1,321 | $ 1,682 |
Debt Securities - Schedule of D
Debt Securities - Schedule of Debt Securities with Gross Unrealized Losses, by Investment Category (Details) - SBA Pool Securities [Member] - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Available for Sale, Securities Position Over 12 Months, Gross unrealized Losses | $ 43 | $ 52 |
Available for Sale, Securities Position Over 12 Months, Fair Value | 1,321 | 1,682 |
Available for Sale, Securities Position Less than 12 Month, Gross unrealized Losses | ||
Available for Sale, Securities Position Less than 12 Month, Fair Value |
Loans - Schedule of Components
Loans - Schedule of Components of Loans (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Jun. 30, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Dec. 31, 2018 |
Total loans | $ 147,229 | $ 104,189 | ||||
Net deferred (loan fees), costs and premiums | (522) | 53 | ||||
Allowance for loan losses | (2,145) | $ (2,664) | (2,009) | $ (2,104) | $ (2,053) | $ (2,243) |
Loans, net | 144,532 | 102,233 | ||||
Residential Real Estate [Member] | ||||||
Total loans | 32,094 | 28,266 | ||||
Allowance for loan losses | (544) | (717) | (531) | (532) | (537) | (544) |
Multi-Family Real Estate [Member] | ||||||
Total loans | 16,052 | 8,396 | ||||
Allowance for loan losses | (228) | (153) | (82) | (41) | (41) | (88) |
Commercial Real Estate [Member] | ||||||
Total loans | 67,060 | 55,652 | ||||
Allowance for loan losses | (972) | (888) | (624) | (745) | (658) | (545) |
Land and Construction [Member] | ||||||
Total loans | 4,332 | 2,496 | ||||
Allowance for loan losses | (51) | (50) | (21) | (20) | (7) | (37) |
Commercial [Member] | ||||||
Total loans | 22,611 | 4,476 | ||||
Allowance for loan losses | (137) | (620) | (573) | (590) | (558) | (850) |
Consumer [Member] | ||||||
Total loans | 5,080 | 4,903 | ||||
Allowance for loan losses | $ (213) | $ (236) | $ (152) | $ (176) | $ (11) | $ (25) |
Loans - Schedule of Change in A
Loans - Schedule of Change in Allowance for Loan Losses (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | |
Beginning balance | $ 2,664 | $ 2,053 | $ 2,009 | $ 2,243 | |
Provision (credit) for loan losses | 524 | 45 | 1,236 | 45 | |
Charge-offs | (1,051) | (1,128) | (202) | ||
Recoveries | 8 | 6 | 28 | 18 | |
Ending balance | 2,145 | 2,104 | 2,145 | 2,104 | |
Individually evaluated for impairment, Recorded investment | 2,193 | 2,193 | $ 3,962 | ||
Individually evaluated for impairment, Allowance for loan losses | 789 | ||||
Collectively evaluated for impairment, Recorded investment | 145,036 | 145,036 | 100,227 | ||
Collectively evaluated for impairment, Allowance for loan losses | 2,145 | 2,145 | 1,220 | ||
Residential Real Estate [Member] | |||||
Beginning balance | 717 | 537 | 531 | 544 | |
Provision (credit) for loan losses | 85 | (5) | 264 | (12) | |
Charge-offs | (259) | (259) | |||
Recoveries | 1 | 8 | |||
Ending balance | 544 | 532 | 544 | 532 | |
Individually evaluated for impairment, Recorded investment | 944 | ||||
Individually evaluated for impairment, Allowance for loan losses | 258 | ||||
Collectively evaluated for impairment, Recorded investment | 32,094 | 32,094 | 27,322 | ||
Collectively evaluated for impairment, Allowance for loan losses | 544 | 544 | 273 | ||
Multi-Family Real Estate [Member] | |||||
Beginning balance | 153 | 41 | 82 | 88 | |
Provision (credit) for loan losses | 75 | 146 | (47) | ||
Charge-offs | |||||
Recoveries | |||||
Ending balance | 228 | 41 | 228 | 41 | |
Individually evaluated for impairment, Recorded investment | |||||
Individually evaluated for impairment, Allowance for loan losses | |||||
Collectively evaluated for impairment, Recorded investment | 16,052 | 16,052 | 8,396 | ||
Collectively evaluated for impairment, Allowance for loan losses | 228 | 228 | 82 | ||
Commercial Real Estate [Member] | |||||
Beginning balance | 888 | 658 | 624 | 545 | |
Provision (credit) for loan losses | 84 | 87 | 348 | 395 | |
Charge-offs | (195) | ||||
Recoveries | |||||
Ending balance | 972 | 745 | 972 | 745 | |
Individually evaluated for impairment, Recorded investment | 2,193 | 2,193 | 2,206 | ||
Individually evaluated for impairment, Allowance for loan losses | |||||
Collectively evaluated for impairment, Recorded investment | 64,867 | 64,867 | 53,446 | ||
Collectively evaluated for impairment, Allowance for loan losses | 972 | 972 | 624 | ||
Land and Construction [Member] | |||||
Beginning balance | 50 | 7 | 21 | 37 | |
Provision (credit) for loan losses | (5) | 7 | 12 | (35) | |
Charge-offs | |||||
Recoveries | 6 | 6 | 18 | 18 | |
Ending balance | 51 | 20 | 51 | 20 | |
Individually evaluated for impairment, Recorded investment | |||||
Individually evaluated for impairment, Allowance for loan losses | |||||
Collectively evaluated for impairment, Recorded investment | 4,332 | 4,332 | 2,496 | ||
Collectively evaluated for impairment, Allowance for loan losses | 51 | 51 | 21 | ||
Commercial [Member] | |||||
Beginning balance | 620 | 558 | 573 | 850 | |
Provision (credit) for loan losses | 292 | 32 | 339 | (260) | |
Charge-offs | (775) | (775) | |||
Recoveries | |||||
Ending balance | 137 | 590 | 137 | 590 | |
Individually evaluated for impairment, Recorded investment | 812 | ||||
Individually evaluated for impairment, Allowance for loan losses | 531 | ||||
Collectively evaluated for impairment, Recorded investment | 22,611 | 22,611 | 3,664 | ||
Collectively evaluated for impairment, Allowance for loan losses | 137 | 137 | 42 | ||
Consumer [Member] | |||||
Beginning balance | 236 | 11 | 152 | 25 | |
Provision (credit) for loan losses | (7) | 165 | 153 | 158 | |
Charge-offs | (17) | (94) | (7) | ||
Recoveries | 1 | 2 | |||
Ending balance | 213 | 176 | 213 | 176 | |
Individually evaluated for impairment, Recorded investment | |||||
Individually evaluated for impairment, Allowance for loan losses | |||||
Collectively evaluated for impairment, Recorded investment | 5,080 | 5,080 | 4,903 | ||
Collectively evaluated for impairment, Allowance for loan losses | 213 | 213 | 152 | ||
Unallocated [Member] | |||||
Beginning balance | 241 | 26 | 154 | ||
Provision (credit) for loan losses | (241) | (26) | (154) | ||
Charge-offs | |||||
Recoveries | |||||
Ending balance | |||||
Individually evaluated for impairment, Recorded investment | |||||
Individually evaluated for impairment, Allowance for loan losses | |||||
Collectively evaluated for impairment, Recorded investment | |||||
Collectively evaluated for impairment, Allowance for loan losses | $ 26 |
Loans - Schedule of Loans by Cr
Loans - Schedule of Loans by Credit Quality (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Risk rated loans | $ 147,229 | $ 104,189 |
Pass [Member] | ||
Risk rated loans | 141,043 | 97,920 |
OLEM (Other Loans Especially Mentioned) [Member] | ||
Risk rated loans | 3,966 | 2,307 |
Sub-standard [Member] | ||
Risk rated loans | 2,220 | 3,962 |
Doubtful [Member] | ||
Risk rated loans | ||
Loss [Member] | ||
Risk rated loans | ||
Residential Real Estate [Member] | ||
Risk rated loans | 32,094 | 28,266 |
Residential Real Estate [Member] | Pass [Member] | ||
Risk rated loans | 32,094 | 27,322 |
Residential Real Estate [Member] | OLEM (Other Loans Especially Mentioned) [Member] | ||
Risk rated loans | ||
Residential Real Estate [Member] | Sub-standard [Member] | ||
Risk rated loans | 944 | |
Residential Real Estate [Member] | Doubtful [Member] | ||
Risk rated loans | ||
Residential Real Estate [Member] | Loss [Member] | ||
Risk rated loans | ||
Multi-Family Real Estate [Member] | ||
Risk rated loans | 16,052 | 8,396 |
Multi-Family Real Estate [Member] | Pass [Member] | ||
Risk rated loans | 16,052 | 8,396 |
Multi-Family Real Estate [Member] | OLEM (Other Loans Especially Mentioned) [Member] | ||
Risk rated loans | ||
Multi-Family Real Estate [Member] | Sub-standard [Member] | ||
Risk rated loans | ||
Multi-Family Real Estate [Member] | Doubtful [Member] | ||
Risk rated loans | ||
Multi-Family Real Estate [Member] | Loss [Member] | ||
Risk rated loans | ||
Commercial Real Estate [Member] | ||
Risk rated loans | 67,060 | 55,652 |
Commercial Real Estate [Member] | Pass [Member] | ||
Risk rated loans | 63,055 | 53,011 |
Commercial Real Estate [Member] | OLEM (Other Loans Especially Mentioned) [Member] | ||
Risk rated loans | 1,812 | 435 |
Commercial Real Estate [Member] | Sub-standard [Member] | ||
Risk rated loans | 2,193 | 2,206 |
Commercial Real Estate [Member] | Doubtful [Member] | ||
Risk rated loans | ||
Commercial Real Estate [Member] | Loss [Member] | ||
Risk rated loans | ||
Land and Construction [Member] | ||
Risk rated loans | 4,332 | 2,496 |
Land and Construction [Member] | Pass [Member] | ||
Risk rated loans | 2,716 | 1,261 |
Land and Construction [Member] | OLEM (Other Loans Especially Mentioned) [Member] | ||
Risk rated loans | 1,616 | 1,235 |
Land and Construction [Member] | Sub-standard [Member] | ||
Risk rated loans | ||
Land and Construction [Member] | Doubtful [Member] | ||
Risk rated loans | ||
Land and Construction [Member] | Loss [Member] | ||
Risk rated loans | ||
Commercial [Member] | ||
Risk rated loans | 22,611 | 4,476 |
Commercial [Member] | Pass [Member] | ||
Risk rated loans | 22,073 | 3,027 |
Commercial [Member] | OLEM (Other Loans Especially Mentioned) [Member] | ||
Risk rated loans | 538 | 637 |
Commercial [Member] | Sub-standard [Member] | ||
Risk rated loans | 812 | |
Commercial [Member] | Doubtful [Member] | ||
Risk rated loans | ||
Commercial [Member] | Loss [Member] | ||
Risk rated loans | ||
Consumer [Member] | ||
Risk rated loans | 5,080 | 4,903 |
Consumer [Member] | Pass [Member] | ||
Risk rated loans | 5,053 | 4,903 |
Consumer [Member] | OLEM (Other Loans Especially Mentioned) [Member] | ||
Risk rated loans | ||
Consumer [Member] | Sub-standard [Member] | ||
Risk rated loans | 27 | |
Consumer [Member] | Doubtful [Member] | ||
Risk rated loans | ||
Consumer [Member] | Loss [Member] | ||
Risk rated loans |
Loans - Schedule of Age Analysi
Loans - Schedule of Age Analysis of Past-due Loans (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Total Past Due | $ 27 | $ 2,179 |
Current Loans | 147,202 | 101,198 |
Nonaccrual Loans | 812 | |
Total Loans | 147,229 | 104,189 |
Financing Receivables, 30 to 59 Days Past Due [Member] | ||
Total Past Due | 14 | 2,179 |
Financing Receivables, 60 to 89 Days Past Due [Member] | ||
Total Past Due | 13 | |
Financing Receivables, Greater Than 90 Days Past Due [Member] | ||
Total Past Due | ||
Residential Real Estate [Member] | ||
Total Past Due | 944 | |
Current Loans | 32,094 | 27,322 |
Nonaccrual Loans | ||
Total Loans | 32,094 | 28,266 |
Residential Real Estate [Member] | Financing Receivables, 30 to 59 Days Past Due [Member] | ||
Total Past Due | 944 | |
Residential Real Estate [Member] | Financing Receivables, 60 to 89 Days Past Due [Member] | ||
Total Past Due | ||
Residential Real Estate [Member] | Financing Receivables, Greater Than 90 Days Past Due [Member] | ||
Total Past Due | ||
Multi-Family Real Estate [Member] | ||
Total Past Due | ||
Current Loans | 16,052 | 8,396 |
Nonaccrual Loans | ||
Total Loans | 16,052 | 8,396 |
Multi-Family Real Estate [Member] | Financing Receivables, 30 to 59 Days Past Due [Member] | ||
Total Past Due | ||
Multi-Family Real Estate [Member] | Financing Receivables, 60 to 89 Days Past Due [Member] | ||
Total Past Due | ||
Multi-Family Real Estate [Member] | Financing Receivables, Greater Than 90 Days Past Due [Member] | ||
Total Past Due | ||
Commercial Real Estate [Member] | ||
Total Past Due | ||
Current Loans | 67,060 | 55,652 |
Nonaccrual Loans | ||
Total Loans | 67,060 | 55,652 |
Commercial Real Estate [Member] | Financing Receivables, 30 to 59 Days Past Due [Member] | ||
Total Past Due | ||
Commercial Real Estate [Member] | Financing Receivables, 60 to 89 Days Past Due [Member] | ||
Total Past Due | ||
Commercial Real Estate [Member] | Financing Receivables, Greater Than 90 Days Past Due [Member] | ||
Total Past Due | ||
Land and Construction [Member] | ||
Total Past Due | 1,235 | |
Current Loans | 4,332 | 1,261 |
Nonaccrual Loans | ||
Total Loans | 4,332 | 2,496 |
Land and Construction [Member] | Financing Receivables, 30 to 59 Days Past Due [Member] | ||
Total Past Due | 1,235 | |
Land and Construction [Member] | Financing Receivables, 60 to 89 Days Past Due [Member] | ||
Total Past Due | ||
Land and Construction [Member] | Financing Receivables, Greater Than 90 Days Past Due [Member] | ||
Total Past Due | ||
Commercial [Member] | ||
Total Past Due | ||
Current Loans | 22,611 | 3,664 |
Nonaccrual Loans | 812 | |
Total Loans | 22,611 | 4,476 |
Commercial [Member] | Financing Receivables, 30 to 59 Days Past Due [Member] | ||
Total Past Due | ||
Commercial [Member] | Financing Receivables, 60 to 89 Days Past Due [Member] | ||
Total Past Due | ||
Commercial [Member] | Financing Receivables, Greater Than 90 Days Past Due [Member] | ||
Total Past Due | ||
Consumer [Member] | ||
Total Past Due | 27 | |
Current Loans | 5,053 | 4,903 |
Nonaccrual Loans | ||
Total Loans | 5,080 | 4,903 |
Consumer [Member] | Financing Receivables, 30 to 59 Days Past Due [Member] | ||
Total Past Due | 14 | |
Consumer [Member] | Financing Receivables, 60 to 89 Days Past Due [Member] | ||
Total Past Due | 13 | |
Consumer [Member] | Financing Receivables, Greater Than 90 Days Past Due [Member] | ||
Total Past Due |
Loans - Schedule of Impaired Lo
Loans - Schedule of Impaired Loans (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Total: recorded investment | $ 2,193 | $ 3,962 |
Total: unpaid principal balance | 2,193 | 3,962 |
Total: related allowance | 789 | |
Commercial Real Estate [Member] | ||
Recorded Investment , With no related allowance recorded | 2,193 | 2,206 |
Unpaid Principal Balance, With no related allowance recorded | 2,193 | 2,206 |
Related Allowance, With no related allowance recorded | ||
Total: recorded investment | 2,193 | 2,206 |
Total: unpaid principal balance | 2,193 | 2,206 |
Total: related allowance | ||
Residential Real Estate [Member] | ||
Recorded Investment , With related allowance recorded | 944 | |
Unpaid Principal Balance, With related allowance recorded | 944 | |
Related Allowance, With related allowance recorded | 258 | |
Total: recorded investment | 944 | |
Total: unpaid principal balance | 944 | |
Total: related allowance | 258 | |
Commercial [Member] | ||
Recorded Investment , With related allowance recorded | 812 | |
Unpaid Principal Balance, With related allowance recorded | 812 | |
Related Allowance, With related allowance recorded | 531 | |
Total: recorded investment | 812 | |
Total: unpaid principal balance | 812 | |
Total: related allowance | $ 531 |
Loans - Schedule of Interest In
Loans - Schedule of Interest Income Recognized and Received on Impaired Loans (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Impaired loans - Average Recorded Investment | $ 3,089 | $ 4,042 | $ 3,689 | $ 5,085 |
Impaired loans - Interest Income Recognized | 26 | 46 | 96 | 187 |
Impaired loans - Interest Income Received | 46 | 89 | 181 | |
Residential Real Estate [Member] | ||||
Impaired loans - Average Recorded Investment | 626 | 950 | 846 | 950 |
Impaired loans - Interest Income Recognized | 19 | 18 | 56 | |
Impaired loans - Interest Income Received | 19 | 11 | 56 | |
Commercial Real Estate [Member] | ||||
Impaired loans - Average Recorded Investment | 2,193 | 2,280 | 2,194 | 2,808 |
Impaired loans - Interest Income Recognized | 26 | 27 | 78 | 88 |
Impaired loans - Interest Income Received | 27 | 60 | 86 | |
Commercial [Member] | ||||
Impaired loans - Average Recorded Investment | 270 | 812 | 649 | 1,327 |
Impaired loans - Interest Income Recognized | 43 | |||
Impaired loans - Interest Income Received | $ 18 | $ 39 |
Loss Per Share - Schedule of We
Loss Per Share - Schedule of Weighted Average Number of Common Shares Outstanding (Details) - shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Earnings Per Share [Abstract] | ||||
Weighted-average number of common shares outstanding used to calculate basic and diluted loss per common share | 2,951,353 | 1,928,269 | 2,920,961 | 1,886,592 |
Stock-Based Compensation (Detai
Stock-Based Compensation (Details Narrative) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 6 Months Ended | ||
Aug. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2019 | Jul. 31, 2020 | Dec. 31, 2019 | |
Other liabilities | $ 523 | $ 1,320 | |||
2018 Equity Incentive Plan [Member] | |||||
Share-based compensation number of shares authorized | 550,000 | 250,000 | |||
Share-based compensation number of additional shares authorized | 300,000 | ||||
Share-based compensation remain available for grant | 318,184 | ||||
Director [Member] | |||||
Compensation expense | $ 200 | $ 201 | |||
Common stock issued as compensation to directors for services | 74,626 | 58,309 | |||
Other liabilities | $ 200 |
Fair Value Measurements (Detail
Fair Value Measurements (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Quoted Prices In Active Markets for Identical Assets (Level 1) [Member] | ||||
Debt securities transferred in or out | ||||
Significant Other Observable Inputs (Level 2) [Member] | ||||
Debt securities transferred in or out | ||||
Significant Unobservable Inputs (Level 3) [Member] | ||||
Debt securities transferred in or out |
Fair Value Measurements - Sched
Fair Value Measurements - Schedule of Assets Measured on Nonrecurring Basis (Details) - Fair Value Measurements Nonrecurring [Member] - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Dec. 31, 2019 | |
Losses recorded in operations during the period | ||
Residential Real Estate [Member] | ||
Losses recorded in operations during the period | 258 | |
Residential Real Estate [Member] | Fair Value [Member] | ||
Losses recorded in operations during the period | 686 | |
Residential Real Estate [Member] | Quoted Prices In Active Markets for Identical Assets (Level 1) [Member] | ||
Losses recorded in operations during the period | ||
Residential Real Estate [Member] | Significant Other Observable Inputs (Level 2) [Member] | ||
Losses recorded in operations during the period | ||
Residential Real Estate [Member] | Significant Unobservable Inputs (Level 3) [Member] | ||
Losses recorded in operations during the period | $ 686 | |
Other Real Estate Owned [Member] | ||
Losses recorded in operations during the period | ||
Other Real Estate Owned [Member] | Fair Value [Member] | ||
Losses recorded in operations during the period | 681 | |
Other Real Estate Owned [Member] | Quoted Prices In Active Markets for Identical Assets (Level 1) [Member] | ||
Losses recorded in operations during the period | ||
Other Real Estate Owned [Member] | Significant Other Observable Inputs (Level 2) [Member] | ||
Losses recorded in operations during the period | ||
Other Real Estate Owned [Member] | Significant Unobservable Inputs (Level 3) [Member] | ||
Losses recorded in operations during the period | $ 681 |
Fair Value Measurements - Sch_2
Fair Value Measurements - Schedule of Debt Securities Available-for-sale Measured at Fair Value on Recurring Basis (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Available-for-sale securities | $ 7,460 | $ 5,409 |
SBA Pool Securities [Member] | ||
Available-for-sale securities | 1,321 | 1,682 |
Collateralized Mortgage Obligations [Member] | ||
Available-for-sale securities | 617 | 1,016 |
Mortgage Backed Securities [Member] | ||
Available-for-sale securities | 5,522 | 2,711 |
Fair Value [Member] | ||
Available-for-sale securities | 7,460 | 5,409 |
Quoted Prices In Active Markets for Identical Assets (Level 1) [Member] | ||
Available-for-sale securities | ||
Significant Other Observable Inputs (Level 2) [Member] | ||
Available-for-sale securities | 7,460 | 5,409 |
Significant Unobservable Inputs (Level 3) [Member] | ||
Available-for-sale securities | ||
Fair Value, Measurements, Recurring [Member] | Fair Value [Member] | SBA Pool Securities [Member] | ||
Available-for-sale securities | 1,321 | 1,682 |
Fair Value, Measurements, Recurring [Member] | Fair Value [Member] | Collateralized Mortgage Obligations [Member] | ||
Available-for-sale securities | 617 | 1,016 |
Fair Value, Measurements, Recurring [Member] | Fair Value [Member] | Mortgage Backed Securities [Member] | ||
Available-for-sale securities | 5,522 | 2,711 |
Fair Value, Measurements, Recurring [Member] | Quoted Prices In Active Markets for Identical Assets (Level 1) [Member] | SBA Pool Securities [Member] | ||
Available-for-sale securities | ||
Fair Value, Measurements, Recurring [Member] | Quoted Prices In Active Markets for Identical Assets (Level 1) [Member] | Collateralized Mortgage Obligations [Member] | ||
Available-for-sale securities | ||
Fair Value, Measurements, Recurring [Member] | Quoted Prices In Active Markets for Identical Assets (Level 1) [Member] | Mortgage Backed Securities [Member] | ||
Available-for-sale securities | ||
Fair Value, Measurements, Recurring [Member] | Significant Other Observable Inputs (Level 2) [Member] | SBA Pool Securities [Member] | ||
Available-for-sale securities | 1,321 | 1,682 |
Fair Value, Measurements, Recurring [Member] | Significant Other Observable Inputs (Level 2) [Member] | Collateralized Mortgage Obligations [Member] | ||
Available-for-sale securities | 617 | 1,016 |
Fair Value, Measurements, Recurring [Member] | Significant Other Observable Inputs (Level 2) [Member] | Mortgage Backed Securities [Member] | ||
Available-for-sale securities | 5,522 | 2,711 |
Fair Value, Measurements, Recurring [Member] | Significant Unobservable Inputs (Level 3) [Member] | SBA Pool Securities [Member] | ||
Available-for-sale securities | ||
Fair Value, Measurements, Recurring [Member] | Significant Unobservable Inputs (Level 3) [Member] | Collateralized Mortgage Obligations [Member] | ||
Available-for-sale securities | ||
Fair Value, Measurements, Recurring [Member] | Significant Unobservable Inputs (Level 3) [Member] | Mortgage Backed Securities [Member] | ||
Available-for-sale securities |
Fair Value of Financial Instr_3
Fair Value of Financial Instruments - Schedule of Estimated Fair Value of Financial Instruments (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 | |
Debt securities available for sale | $ 7,460 | $ 5,409 | |
Debt securities held-to-maturity | 4,571 | 5,806 | |
Accrued interest receivable | 1,544 | 432 | |
Quoted Prices In Active Markets for Identical Assets (Level 1) [Member] | |||
Cash and cash equivalents | 45,271 | 8,934 | |
Debt securities available for sale | |||
Significant Other Observable Inputs (Level 2) [Member] | |||
Debt securities available for sale | 7,460 | 5,409 | |
Debt securities held-to-maturity | 4,794 | 5,986 | |
Significant Unobservable Inputs (Level 3) [Member] | |||
Debt securities available for sale | |||
Loans | 144,691 | 102,060 | |
Federal Home Loan Bank stock | 1,092 | 642 | |
Accrued interest receivable | 1,544 | 432 | |
Deposit liabilities | 168,003 | 101,256 | |
Federal Home Loan Bank advances | 23,309 | 13,137 | |
Junior subordinated debenture | |||
Off-balance sheet financial instruments | |||
Carrying Amount [Member] | |||
Cash and cash equivalents | 45,271 | 8,934 | |
Debt securities available for sale | 7,460 | 5,409 | |
Debt securities held-to-maturity | 4,571 | 5,806 | |
Loans | 144,532 | 102,233 | |
Federal Home Loan Bank stock | 1,092 | 642 | |
Accrued interest receivable | 1,544 | 432 | |
Deposit liabilities | 167,716 | 101,372 | |
Federal Home Loan Bank advances | 23,000 | 13,000 | |
Junior subordinated debenture | 2,580 | 2,580 | |
Off-balance sheet financial instruments | |||
Estimate of Fair Value Measurement [Member] | |||
Cash and cash equivalents | 45,271 | 8,934 | |
Debt securities available for sale | 7,460 | 5,409 | |
Debt securities held-to-maturity | 4,794 | 5,986 | |
Loans | 144,641 | 102,060 | |
Federal Home Loan Bank stock | 1,092 | 642 | |
Accrued interest receivable | 1,544 | 432 | |
Deposit liabilities | 168,003 | 101,256 | |
Federal Home Loan Bank advances | 23,311 | 13,137 | |
Junior subordinated debenture | [1] | ||
Off-balance sheet financial instruments | |||
[1] | The Company is unable to determine value based on significant unobservable inputs required in the calculation. Refer to Note 1 for further information. |
Off- Balance Sheet Financial _3
Off- Balance Sheet Financial Instruments - Schedule of Off-Balance Sheet Risks of Financial Instruments (Details) $ in Thousands | Sep. 30, 2020USD ($) |
Off- Balance Sheet Financial Instruments | |
Commitments to extend credit | $ 4,091 |
Unused lines of credit | 5,332 |
Standby letters of credit | $ 4,550 |
Regulatory Matters (Details Nar
Regulatory Matters (Details Narrative) $ in Thousands | 9 Months Ended |
Sep. 30, 2020USD ($) | |
Community bank leverage ratio | 8.00% |
Maximum [Member] | |
Community banking organizations of assets | $ 10,000,000 |
Regulatory Matters - Schedule o
Regulatory Matters - Schedule of Capital Amounts, Ratios and Regulatory Thresholds (Details) $ in Thousands | Sep. 30, 2020USD ($) | Dec. 31, 2019USD ($) |
Line of Credit Facility [Abstract] | ||
Total Capital to Risk-Weighted Assets | $ 12,212 | |
Total Capital to Risk-Weighted Assets, Ratio | 0.1203 | |
Tier I Capital to Risk-Weighted Assets | $ 10,934 | |
Tier I Capital to Risk-Weighted Assets, Ratio | 0.1077 | |
Common equity Tier I capital to Risk-Weighted Assets | $ 10,934 | |
Common equity Tier I capital to Risk-Weighted Assets, Ratio | 10.77% | |
Tier I Capital to Total Assets | $ 16,175 | $ 10,934 |
Tier I Capital to Total Assets, Ratio | 0.0870 | 0.0873 |
Total Capital to Risk-Weighted Assets For Capital Adequacy Purposes | $ 8,124 | |
Total Capital to Risk-Weighted Assets For Capital Adequacy Purposes, Ratio | 0.0800 | |
Tier I Capital to Risk-Weighted Assets For Capital Adequacy Purposes | $ 6,093 | |
Tier I Capital to Risk-Weighted Assets For Capital Adequacy Purposes, Ratio | 0.0600 | |
Common equity Tier I capital to Risk-Weighted Assets For Capital Adequacy Purposes | $ 4,569 | |
Common equity Tier I capital to Risk-Weighted Assets For Capital Adequacy Purposes, Ratio | 4.50% | |
Tier I Capital to Total Assets For Capital Adequacy Purposes | $ 7,434 | $ 5,010 |
Tier I Capital to Total Assets For Capital Adequacy Purposes, Ratio | 0.0400 | 0.0400 |
Total Capital to Risk-Weighted Assets Minimum To Be Well Capitalized Under Prompt Corrective Action Provisions | $ 10,154 | |
Total Capital to Risk-Weighted Assets Minimum To Be Well Capitalized Under Prompt Corrective Action Provisions, Ratio | 0.1000 | |
Tier I Capital to Risk-Weighted Assets Minimum To Be Well Capitalized Under Prompt Corrective Action Provisions | $ 8,124 | |
Tier I Capital to Risk-Weighted Assets Minimum To Be Well Capitalized Under Prompt Corrective Action Provisions, Ratio | 0.0800 | |
Common equity Tier I capital to Risk-Weighted Assets Minimum To Be Well Capitalized Under Prompt Corrective Action Provisions | $ 6,600 | |
Common equity Tier I capital to Risk-Weighted Assets Minimum To Be Well Capitalized Under Prompt Corrective Action Provisions, Ratio | 6.50% | |
Tier I Capital to Total Assets Minimum To Be Well Capitalized Under Prompt Corrective Action Provisions | $ 9,292 | $ 6,263 |
Tier I Capital to Total Assets Minimum To Be Well Capitalized Under Prompt Corrective Action Provisions, Ratio | 0.0500 | 0.0500 |
Preferred Stock (Details Narrat
Preferred Stock (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | |
Mar. 31, 2020 | Sep. 30, 2020 | Dec. 31, 2019 | |
Shares issued during the period, amount | $ 539 | ||
Preferred stock no par value | |||
Convertible shares of common stock | 2,800,000 | ||
Liquidation preference per share | $ 25,000 | ||
Series B Preferred Stock [Member] | |||
Stockholders beneficial ownership percentage of outstanding shares of common stock | 9.90% | ||
Preferred stock, voting rights | The Preferred Stock generally has no voting rights except as provided in the Certificate of Designation. | ||
Series B Participating Preferred Stock [Member] | Related Party [Member] | |||
Number of shares issued | 280 | ||
Shares issued price per shares | $ 25,000 | ||
Shares issued during the period, amount | $ 700 |
Contingency (Details Narrative)
Contingency (Details Narrative) $ in Thousands | 9 Months Ended |
Sep. 30, 2020USD ($)Loan | |
Paycheck Protection Program [Member] | |
PPP loans, amount | $ 19,200 |
Number of loans orginated | Loan | 204 |
Paycheck Protection Program Liquidity Facility [Member] | |
PPPLF outstanding borrowings |