Note 5.

Allowance for Loan Losses and Credit Quality

Allowance for Loan Losses

The allowance for loan losses is maintained at a level management deems sufficient to absorb probable loan losses inherent in the loan portfolio. The allowance is increased by charges to earnings in the form of provision for loan losses and recoveries of prior loan charge-offs, and decreased by loans charged off. The provision is calculated to bring the allowance to a level which, according to a systematic process of measurement, reflects the amount management estimates is needed to absorb probable losses within the portfolio. While management utilizes its best judgment and information available, the ultimate adequacy of the allowance is dependent upon a variety of factors beyond the Company’s control, including, among other things, the performance of the Company’s loan portfolio, the economy, changes in interest rates, and the view of the regulatory authorities toward loan classifications. Purchased credit impaired loan pools are evaluated separately from the non-purchased credit impaired portfolio for impairment. See “Note 2 – Business Combinations and Branching Activity” herein for additional information.

Management performs quarterly assessments to determine the appropriate level of allowance for loan losses. Differences between actual loan loss experience and estimates are reflected through adjustments that are made by increasing or decreasing the allowance based upon current measurement criteria. Commercial, consumer real estate, and non-real estate consumer loan portfolios are evaluated separately for purposes of determining the allowance. The specific components of the allowance include allocations to individual commercial loans and credit relationships and allocations to the remaining nonhomogeneous and homogeneous pools of loans that have been deemed impaired. Additionally, a loan that becomes adversely classified or graded is removed from a group of loans with similar risk characteristics that are not classified or graded to evaluate the removed loan collectively in a group of adversely classified or graded loans with similar risk characteristics. Management’s general reserve allocations are based on judgment of qualitative and quantitative factors about macro and micro economic conditions reflected within the portfolio of loans and the economy as a whole. Factors considered in this evaluation include, but are not necessarily limited to, probable losses from loan and other credit arrangements, general economic conditions, changes in credit concentrations or pledged collateral, historical loan loss experience, and trends in portfolio volume, maturities, composition, delinquencies, and nonaccruals. Historical loss rates for each risk grade of commercial loans are adjusted by environmental factors to estimate the amount of reserve needed by segment. While management has allocated the allowance for loan losses to various portfolio segments, the entire allowance is available for use against any type of loan loss deemed appropriate by management.

Purchased performing loans are recorded at fair value and include credit and interest rate marks associated with acquisition accounting adjustments, as accounted for under the contractual cash flow method of accounting. The fair value adjustment is accreted as an adjustment to yield over the estimated contractual lives of the loans. There is no allowance for loan losses established at the acquisition date for acquired performing loans. A provision for loan losses is recorded for any credit deterioration in these loans subsequent to the acquisition. In accordance with GAAP, there was no carryover of previously established allowance for loan losses on acquired portfolios.

The following tables detail activity within the allowance for loan losses, by portfolio segment, for the dates indicated:


(Amounts in thousands)	Commercial			Consumer Real Estate			Consumer and Other			Total
Beginning balance, January 1, 2010	$	13,607		$	8,337		$	2,333		$	24,277
Provision for loan losses		6,552			8,106			99			14,757
Loans charged off		(7,980	)		(4,352	)		(1,270	)		(13,602	)
Recoveries credited to allowance		339			109			602			1,050

Net charge-offs		(7,641	)		(4,243	)		(668	)		(12,552	)

Ending balance, December 31, 2010	$	12,518		$	12,200		$	1,764		$	26,482

Beginning balance, January 1, 2011	$	12,300		$	12,641		$	1,541		$	26,482
Provision for loan losses		12,007			(2,681	)		(279	)		9,047
Loans charged off		(7,981	)		(2,501	)		(978	)		(11,460	)
Recoveries credited to allowance		1,426			252			458			2,136

Net charge-offs		(6,555	)		(2,249	)		(520	)		(9,324	)

Ending balance, December 31, 2011	$	17,752		$	7,711		$	742		$	26,205

Beginning balance, January 1, 2012	$	17,752		$	7,711		$	742		$	26,205
Provision for loan losses		2,703			2,608			367			5,678
Loans charged off		(3,814	)		(2,702	)		(988	)		(7,504	)
Recoveries credited to allowance		626			289			476			1,391

Net charge-offs		(3,188	)		(2,413	)		(512	)		(6,113	)

Ending balance, December 31, 2012	$	17,267		$	7,906		$	597		$	25,770

The negative provision in the consumer real estate and consumer and other segments in 2011 was the result of the refinement in the allowance for loan losses methodology during 2011 to further segment single family real estate into non-owner (commercial) and owner occupied (consumer real estate).

The Company identifies loans for potential impairment through a variety of means including, but not limited to, ongoing loan review, renewal processes, delinquency data, market communications, and public information. If it is determined that it is probable that the Company will not collect all principal and interest amounts contractually due, the loan is generally deemed to be impaired. The following tables present the Company’s recorded investment in non-purchased loans considered to be impaired and related information on those impaired loans for the periods indicated:


	December 31, 2012
(Amounts in thousands)	Recorded Investment		Unpaid Principal Balance		Related Allowance		Average Recorded Investment		Interest Income Recognized
Impaired loans with no related allowance:
Commercial loans
Construction, development, and other land	$	2,916	$	2,916	$	—	$	935	$	3
Commercial and industrial		284		284		—		320		17
Multi-family residential		—		—		—		517		4
Single family non-owner occupied		383		684		—		1,101		56
Non-farm, non-residential		5,282		5,362		—		2,619		102
Agricultural		—		—		—		—		—
Farmland		—		—		—		93		—
Consumer real estate loans
Home equity lines		276		277		—		370		28
Single family owner occupied		277		383		—		4,441		113
Owner occupied construction		—		—		—		—		—
Consumer and other loans
Consumer loans		—		—		—		1		—

Total impaired loans with no related allowance		9,418		9,906		—		10,397		323
Impaired loans with a related allowance:
Commercial loans
Construction, development, and other land		—		—		—		69		1
Commercial and industrial		3,318		8,502		3,192		4,510		948
Multi-family residential		378		397		18		143		3
Single family non-owner occupied		2,411		2,460		996		2,484		80
Non-farm, non-residential		2,781		2,958		358		5,820		317
Agricultural		—		—		—		—		—
Farmland		—		—		—		93		—
Consumer real estate loans
Home equity lines		223		230		223		150		1
Single family owner occupied		4,673		4,903		806		3,511		103
Owner occupied construction		—		—		—		—		—
Consumer and other loans
Consumer loans		—		—		—		—		—

Total impaired loans with a related allowance		13,784		19,450		5,593		16,780		1,453

Total impaired loans	$	23,202	$	29,356	$	5,593	$	27,177	$	1,776


	December 31, 2011
(Amounts in thousands)	Recorded Investment		Unpaid Principal Balance		Related Allowance		Average Recorded Investment		Interest Income Recognized
Impaired loans with no related allowance:
Commercial loans
Construction, development, and other land	$	661	$	661	$	—	$	1,341	$	—
Commercial and industrial		114		127		—		2,251		4
Multi-family residential		278		278		—		1,177		24
Single family non-owner occupied		1,206		1,244		—		1,659		39
Non-farm, non-residential		1,616		1,647		—		2,059		25
Agricultural		—		—		—		—		—
Farmland		258		258		—		167		—
Consumer real estate loans
Home equity lines		368		378		—		476		15
Single family owner occupied		2,428		2,508		—		1,825		43
Owner occupied construction		—		—		—		60		3
Consumer and other loans
Consumer loans		6		6		—		23		2

Total impaired loans with no allowance		6,935		7,107		—		11,038		155
Impaired loans with a related allowance:
Commercial loans
Construction, development, and other land		112		112		4		248		9
Commercial and industrial		4,031		4,069		2,048		2,358		21
Multi-family residential		—		—		—		470		—
Single family non-owner occupied		2,232		2,232		124		2,323		107
Non-farm, non-residential		5,317		5,480		1,819		4,112		191
Agricultural		—		—		—		—		—
Farmland		—		—		—		83		—
Consumer real estate loans
Home equity lines		—		—		—		108		—
Single family owner occupied		5,529		5,612		1,203		5,794		164
Owner occupied construction		—		—		—		—		—
Consumer and other loans
Consumer loans		—		—		—		—		—

Total impaired loans with a related allowance		17,221		17,505		5,198		15,496		492

Total impaired loans	$	24,156	$	24,612	$	5,198	$	26,534	$	647

As part of the ongoing monitoring of the credit quality of the Company’s loan portfolio, management tracks certain credit quality indicators including trends related to the risk rating of commercial loans, the level of classified commercial loans, net charge-offs, nonperforming loans, and general economic conditions. The Company’s loan review function generally reviews all commercial loan relationships greater than $3.0 million on an annual basis and at various times through the year. Smaller commercial and retail loans are sampled for review throughout the year by our internal loan review department. Through the loan review process, loans are identified for upgrade or downgrade in risk rating and changed to reflect current information as part of the process.

The Company aggregates purchase credit impaired loans with common risk characteristics into the following loan pools: construction and development, commercial and industrial, commercial real estate, consumer, home equity lines of credit, residential real estate – 1st lien, residential real estate – 2nd lien, and lines of credit. However, these loan pools are disaggregated in the following tables for disclosure purposes.

The Company utilizes a risk grading matrix to assign a risk grade to each of its loans. A description of the general characteristics of the risk grades is as follows:

•

Pass – This grade includes loans to borrowers of acceptable credit quality and risk. The Company further differentiates within this grade based upon borrower characteristics which include: capital strength, earnings stability, liquidity leverage, and industry.

•

Special Mention – This grade includes loans that require more than a normal degree of supervision and attention. These loans have all the characteristics of an adequate asset, but due to being adversely affected by economic or financial conditions have a potential weakness that deserves management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan.

•

Substandard – This grade includes loans that have well defined weaknesses which make payment default or principal exposure possible, but not yet certain. Such loans are apt to be dependent upon collateral liquidation, a secondary source of repayment, or an event outside of the normal course of business to meet the repayment terms.

•

Doubtful – This grade includes loans that are placed on nonaccrual status. These loans have all the weaknesses inherent in a substandard loan with the added factor that the weaknesses are so severe that collection or liquidation in full, on the basis of current existing facts, conditions and values, is extremely unlikely, but because of certain specific pending factors, the amount of loss cannot yet be determined.

•

Loss – This grade includes loans that are to be charged off or charged down when payment is acknowledged to be uncertain or when the timing or value of payments cannot be determined. “Loss” is not intended to imply that the asset has no recovery or salvage value, but simply that it is not practical or desirable to defer writing off all or some portion of the loan, even though partial recovery may be realized in the future.

The following tables present the Company’s investment in loans held for investment by internal credit grade indicator at December 31, 2012 and 2011. There were no covered loans at December 31, 2011.


	December 31, 2012
(Amounts in thousands)	Pass		Special Mention		Substandard		Doubtful		Loss		Total
Non-covered loans
Commercial loans
Construction, development, and other land	$	33,876	$	1,497	$	13,546	$	541	$	—	$	49,460
Commercial and industrial		77,549		2,506		4,821		3,838		—		88,714
Multi-family residential		60,161		4,043		1,490		—		—		65,694
Single family non-owner occupied		112,297		5,938		16,092		1,320		—		135,647
Non-farm, non-residential		396,986		15,975		32,808		120		—		445,889
Agricultural		1,657		19		33		—		—		1,709
Farmland		28,718		2,262		3,421		—		—		34,401
Consumer real estate loans
Home equity lines		104,750		2,739		3,592		—		—		111,081
Single family owner occupied		435,991		9,599		27,319		—		42		472,951
Owner occupied construction		15,841		382		—		—		—		16,223
Consumer and other loans
Consumer loans		76,787		867		501		8		—		78,163
Other		5,657		8		1		—		—		5,666

Total non-covered loans	$	1,350,270	$	45,835	$	103,624	$	5,827	$	42	$	1,505,598


	December 31, 2012
(Amounts in thousands)	Pass		Special Mention		Substandard		Doubtful		Loss		Total
Covered loans
Commercial loans
Construction, development, and other land	$	14,437	$	2,120	$	17,834	$	178	$	—	$	34,569
Commercial and industrial		6,249		445		197		81		—		6,972
Multi-family residential		1,962		—		649		—		—		2,611
Single family non-owner occupied		6,330		2,223		3,015		125		—		11,693
Non-farm, non-residential		26,776		5,477		19,189		44		—		51,486
Agricultural		143		—		1		—		—		144
Farmland		1,104		—		156		—		—		1,260
Consumer real estate loans
Home equity lines		16,323		11,981		53,116		25		—		81,445
Single family owner occupied		16,607		927		5,786		237		—		23,557
Owner occupied construction		484		—		1,160		—		—		1,644
Consumer and other loans
Consumer loans		2,987		562		125		—		—		3,674
Other		—		—		—		—		—		—

Total covered loans	$	93,402	$	23,735	$	101,228	$	690	$	—	$	219,055


	December 31, 2011
(Amounts in thousands)	Pass		Special Mention		Substandard		Doubtful		Loss		Total
Commercial loans
Construction, development, and other land	$	54,162	$	5,644	$	1,962	$	—	$	—	$	61,768
Commercial and industrial		86,288		568		2,679		2,404		—		91,939
Multi-family residential		74,486		965		1,599		—		—		77,050
Single family non-owner occupied		93,444		1,346		11,953		—		—		106,743
Non-farm, non-residential		303,071		9,635		22,855		444		—		336,005
Agricultural		1,327		7		40		—		—		1,374
Farmland		35,568		1,055		538		—		—		37,161
Consumer real estate loans
Home equity lines		105,535		2,237		3,615		—		—		111,387
Single family owner occupied		435,001		8,936		29,130		—		—		473,067
Owner occupied construction		19,190		128		259		—		—		19,577
Consumer and other loans
Consumer loans		66,357		198		574		—		—		67,129
Other		12,857		1		9		—		—		12,867

Total loans	$	1,287,286	$	30,720	$	75,213	$	2,848	$	—	$	1,396,067

The Peoples and Waccamaw acquisitions added approximately $12.69 million to special mention, $29.82 million to substandard, and $1.37 million to doubtful risk graded non-covered loans. Exclusive of these acquisitions, special mention, doubtful, and loss risk graded non-covered loans increased approximately $2.42 million, $1.61 million, and $42 thousand, respectively, for the year ended December 31, 2012, while substandard risk graded non-covered loans decreased $1.41 million.

The following tables detail the Company’s recorded investment in loans related to each segment in the allowance for loan losses by portfolio segment and disaggregated on the basis of the Company’s impairment methodology at December 31, 2012 and 2011:


	December 31, 2012
(Amounts in thousands)	Non-acquired Loans Individually Evaluated for Impairment		Allowance for Loans Individually Evaluated		Loans Collectively Evaluated for Impairment		Allowance for Loans Collectively Evaluated		Acquired Impaired Loans Evaluated for Impairment		Allowance for Acquired Impaired Loans Evaluated
Commercial loans
Construction, development, and other land	$	2,916	$	—	$	54,579	$	1,214	$	25,744	$	—
Commercial and industrial		3,602		3,192		88,540		1,159		3,544		8
Multi-family residential		378		18		67,278		1,612		649		—
Single family non-owner occupied		2,794		858		134,323		3,509		10,223		—
Non-farm, non-residential		8,063		358		450,172		4,901		38,072		—
Agricultural		—		—		1,852		22		1		—
Farmland		—		—		34,779		416		882		—

Total commercial loans		17,753		4,426		831,523		12,833		79,115		8
Consumer real estate loans
Home equity lines		499		223		141,684		1,351		50,343		—
Single family owner occupied		4,950		944		483,223		5,051		8,005		—
Owner occupied construction		—		—		16,768		337		1,099		—

Total consumer real estate loans		5,449		1,167		641,675		6,739		59,447		—
Consumer and other loans
Consumer loans		—		—		81,037		597		800		—
Other		—		—		5,666		—		—		—

Total consumer and other loans		—		—		86,703		597		800		—

Total loans	$	23,202	$	5,593	$	1,559,901	$	20,169	$	139,362	$	8


	December 31, 2011
(Amounts in thousands)	Non-acquired Loans Individually Evaluated for Impairment		Allowance for Loans Individually Evaluated		Loans Collectively Evaluated for Impairment		Allowance for Loans Collectively Evaluated		Acquired Impaired Loans Evaluated for Impairment		Allowance for Acquired Impaired Loans Evaluated
Commercial loans
Construction, development, and other land	$	773	$	4	$	60,846	$	1,888	$	149	$	—
Commercial and industrial		3,738		1,847		87,563		1,668		638		201
Multi-family residential		278		—		76,772		1,889		—		—
Single family non-owner occupied		3,438		124		102,063		2,836		1,242		—
Non-farm, non-residential		6,933		1,819		328,610		5,114		462		—
Agricultural		—		—		1,374		19		—		—
Farmland		258		—		36,903		343		—		—

Total commercial loans		15,418		3,794		694,131		13,757		2,491		201
Consumer real estate loans
Home equity lines		368		—		111,019		1,365		—		—
Single family owner occupied		7,957		1,203		464,715		4,931		395		—
Owner occupied construction		—		—		19,577		212		—		—

Total consumer real estate loans		8,325		1,203		595,311		6,508		395		—
Consumer and other loans
Consumer loans		6		—		67,123		742		—		—
Other		—		—		12,867		—		—		—

Total consumer and other loans		6		—		79,990		742		—		—

Total loans	$	23,749	$	4,997	$	1,369,432	$	21,007	$	2,886	$	201

Non-accrual and Past Due Loans

Nonaccrual loans, presented by loan class, consisted of the following at December 31, 2012 and 2011. Loans acquired with credit deterioration through business combinations, for which a discount exists, are generally not considered to be nonaccrual as a result of the accretion of the discount which is based on the expected cash flows of the loans.


	December 31, 2012						December 31, 2011
(Amounts in thousands)	Non-covered		Covered		Total		Non-covered
Commercial loans
Construction, development, and other land	$	405	$	1,990	$	2,395	$	793
Commercial and industrial		3,912		35		3,947		3,905
Multi-family residential		378		—		378		341
Single family non-owner occupied		7,071		21		7,092		1,639
Non-farm, non-residential		5,938		951		6,889		8,063
Agricultural		2		—		2		—
Farmland		—		—		—		271
Consumer real estate loans
Home equity lines		872		436		1,308		516
Single family owner occupied		5,219		831		6,050		8,255
Owner occupied construction		—		59		59		1
Consumer and other loans
Consumer loans		126		—		126		52
Other		—		—		—		—

Total		23,923		4,323		28,246		23,836
Acquired impaired loans		8		—		8		651

Total nonaccrual loans	$	23,931	$	4,323	$	28,254	$	24,487

The following tables present the aging of past due loans, by loan class, at December 31, 2012 and 2011. Nonaccrual loans, excluding those 0 to 29 days past due, are included in the applicable delinquency category. There were no accruing loans contractually past due 90 days or more at December 31, 2012 or 2011. Acquired loans that are past due continue to accrue interest through the accretable yield under the accretion method of accounting and therefore are not considered to be nonaccrual.


	December 31, 2012
(Amounts in thousands)	30 - 59 Days Past Due		60 - 89 Days Past Due		90+ Days Past Due		Total Past Due		Current Loans		Total Loans
Non-covered loans
Commercial loans
Construction, development, and other land	$	344	$	—	$	188	$	532	$	48,928	$	49,460
Commercial and industrial		387		84		1,432		1,903		86,811		88,714
Multi-family residential		624		—		—		624		65,070		65,694
Single family non-owner occupied		1,841		1,348		3,715		6,904		128,743		135,647
Non-farm, non-residential		2,702		936		3,621		7,259		438,630		445,889
Agricultural		—		—		—		—		1,709		1,709
Farmland		216		196		—		412		33,989		34,401
Consumer real estate loans
Home equity lines		315		93		495		903		110,178		111,081
Single family owner occupied		6,564		1,176		1,644		9,384		463,567		472,951
Owner occupied construction		382		—		—		382		15,841		16,223
Consumer and other loans
Consumer loans		715		73		47		835		77,328		78,163
Other		—		—		—		—		5,666		5,666

Total non-covered loans	$	14,090	$	3,906	$	11,142	$	29,138	$	1,476,460	$	1,505,598


	December 31, 2012
(Amounts in thousands)	30 -59 Days Past Due		60 - 89 Days Past Due		90+ Days Past Due		Total Past Due		Current Loans		Total Loans
Covered loans
Commercial loans
Construction, development, and other land	$	252	$	161	$	1,121	$	1,534	$	33,035	$	34,569
Commercial and industrial		45		—		—		45		6,927		6,972
Multi-family residential		—		—		—		—		2,611		2,611
Single family non-owner occupied		8		—		21		29		11,664		11,693
Non-farm, non-residential		501		—		927		1,428		50,058		51,486
Agricultural		—		—		—		—		144		144
Farmland		6		—		—		6		1,254		1,260
Consumer real estate loans
Home equity lines		217		112		204		533		80,912		81,445
Single family owner occupied		413		135		475		1,023		22,534		23,557
Owner occupied construction		—		—		59		59		1,585		1,644
Consumer and other loans
Consumer loans		—		—		—		—		3,674		3,674
Other		—		—		—		—		—		—

Total covered loans	$	1,442	$	408	$	2,807	$	4,657	$	214,398	$	219,055


	December 31, 2011
(Amounts in thousands)	30 - 59 Days Past Due		60 - 89 Days Past Due		90+ Days Past Due		Total Past Due		Current Loans		Total Loans
Commercial loans
Construction, development, and other land	$	253	$	—	$	987	$	1,240	$	60,528	$	61,768
Commercial and industrial		150		30		3,568		3,748		88,191		91,939
Multi-family residential		667		—		342		1,009		76,041		77,050
Single family non-owner occupied		1,222		414		1,020		2,656		104,087		106,743
Non-farm, non-residential		837		860		2,180		3,877		332,128		336,005
Agricultural		—		7		—		7		1,367		1,374
Farmland		152		—		258		410		36,751		37,161
Consumer real estate loans
Home equity lines		642		222		235		1,099		110,288		111,387
Single family owner occupied		5,230		1,993		5,333		12,556		460,511		473,067
Owner occupied construction		—		29		—		29		19,548		19,577
Consumer and other loans
Consumer loans		198		71		12		281		66,848		67,129
Other		—		—		—		—		12,867		12,867

Total loans	$	9,351	$	3,626	$	13,935	$	26,912	$	1,369,155	$	1,396,067

Troubled Debt Restructurings

The Company’s troubled debt restructurings (“TDRs”) totaled $12.05 million at December 31, 2012, and $9.45 million at December 31, 2011, which are reported net of those on nonaccrual status of $3.83 million and $3.27 million, respectively. Accruing nonperforming TDRs amounted to $6.01 million, or 49.88% of total accruing TDRs at December 31, 2012, and $600 thousand, or 6.35% of total TDRs at December 31, 2011. The allowance for loan losses included reserves related to TDRs of $1.87 million and $1.14 million at December 31, 2012 and 2011, respectively. Interest income recognized on TDRs for the years ended December 31, 2012 and 2011 totaled $736 thousand and $561 thousand, respectively. There were no covered loans recorded as TDRs at December 31, 2012 or 2011. Loans acquired with credit deterioration through business combinations, for which a discount exists, are generally not considered a TDR as long as the loan remains in the loan pool.

When restructuring loans for borrowers experiencing financial difficulty, the Company generally makes concessions in interest rates, loan terms and/or amortization terms. All restructured loans to borrowers experiencing financial difficulty in excess of $250 thousand are evaluated for a specific reserve based on either the collateral or net present value method, whichever is most applicable. Restructured loans under $250 thousand are subject to the reserve calculation at the historical loss rate for classified loans. Certain TDRs are classified as nonperforming at time of restructuring and are returned to performing status after six months of satisfactory payment performance; however, these loans remain identified as impaired until full payment or other satisfaction of the obligation occurs.

The following tables present information for loans modified as TDRs that were restructured during the years ended December 31, 2012 and 2011 by type of concession made and loan class. The post-modification recorded investment represents the loan balance immediately following modification.


	Years Ended December 31,
	2012						2011
	Total Contracts		Pre- Modification Recorded Investment		Post- Modification Recorded Investment		Total Contracts		Pre- Modification Recorded Investment		Post- Modification Recorded Investment
(Amounts in thousands)
Below market interest rate
Non-farm, non-residential		—	$	—	$	—		1	$	373	$	373
Single family owner occupied		—		—		—		2		159		159

Total		—		—		—		3		532		532
Extended payment term
Commercial and industrial				—		—		—		—		—
Non-farm, non-residential		1		1,119		—		1		126		126
Single family owner occupied		1		351		319		1		267		267

Total		2		1,470		319		2		393		393
Below market interest rate and extended payment term
Non-farm, non-residential		2		5,822		5,822		1		107		107
Single family owner occupied		—		—		—		4		759		736

Total		2		5,822		5,822		5		866		843

Total		4	$	7,292	$	6,141		10	$	1,791	$	1,768

There were no payment defaults on loans modified as TDRs during the year ended December 31, 2012 that were restructured within the previous 12 months. The following table presents loans modified as TDRs within the previous 12 months for which there was a payment default during the year ended December 31, 2011:


	December 31, 2011
	Number of Loans		Pre-Modification Recorded Investment		Post-Modification Recorded Investment
(Amounts in thousands)
Non-farm, non-residential		1	$	38	$	38

Total loan concessions		1	$	38	$	38