Note 6 – Loans by Type

A summary of loan categories is as follows:

	March 31,		December 31,
*(In thousands)*	2019		2018
Commercial and industrial	$	313,404	$	277,091
Real estate
Commercial:
Mortgage		93,268		95,605
Construction		15,293		11,858
Faith-based:
Mortgage		312,164		316,147
Construction		17,070		20,576
Other		110		310
Total loans	$	751,309	$	721,587

The following table presents the aging of loans by loan categories at March 31, 2019 and December 31, 2018:

	Performing						Nonperforming
							90 Days
			30-59		60-89		and		Non-		Total
*(In thousands)*	Current		Days		Days		Over		accrual		Loans
March 31, 2019
Commercial and industrial	$	313,404	$	—	$	—	$	—	$	—	$	313,404
Real estate
Commercial:
Mortgage		93,110		—		158		—		—		93,268
Construction		15,293		—		—		—		—		15,293
Faith-based:
Mortgage		312,164		—		—		—		—		312,164
Construction		17,070		—		—		—		—		17,070
Other		110		—		—		—		—		110
Total	$	751,151	$	—	$	158	$	—	$	—	$	751,309
December 31, 2018
Commercial and industrial	$	277,091	$	—	$	—	$	—	$	—	$	277,091
Real estate
Commercial:
Mortgage		95,605		—		—		—		—		95,605
Construction		11,858		—		—		—		—		11,858
Faith-based:
Mortgage		316,147		—		—		—		—		316,147
Construction		20,576		—		—		—		—		20,576
Other		310		—		—		—		—		310
Total	$	721,587	$	—	$	—	$	—	$	—	$	721,587

The following table presents the credit exposure of the loan portfolio by internally assigned credit grade as of March 31, 2019 and December 31, 2018:

	Loans		Performing		Nonperforming
	Subject to		Loans Subject to		Loans Subject
	Normal		Special		to Special
*(In thousands)*	Monitoring¹		Monitoring²		Monitoring²		Total Loans
March 31, 2019
Commercial and industrial	$	311,776	$	1,628	$	—	$	313,404
Real estate
Commercial:
Mortgage		93,110		158		—		93,268
Construction		15,293		—		—		15,293
Church, church-related:
Mortgage		310,986		1,178		—		312,164
Construction		17,070		—		—		17,070
Other		110		—		—		110
Total	$	748,345	$	2,964	$	—	$	751,309
December 31, 2018
Commercial and industrial	$	275,308	$	1,783	$	—	$	277,091
Real estate
Commercial:
Mortgage		95,447		158		—		95,605
Construction		11,858		—		—		11,858
Church, church-related:
Mortgage		314,940		1,207		—		316,147
Construction		20,576		—		—		20,576
Other		310		—		—		310
Total	$	718,439	$	3,148	$	—	$	721,587

¹	Loans subject to normal monitoring involve borrowers of acceptable-to-strong credit quality and risk, who have the apparent ability to satisfy their loan obligations.
²	Loans subject to special monitoring possess some credit deficiency or potential weakness which requires a high level of management attention.

Impaired loans consist primarily of nonaccrual loans, loans greater than 90 days past due and still accruing interest and troubled debt restructurings, both performing and nonperforming. Troubled debt restructuring involves the granting of a concession to a borrower experiencing financial difficulty resulting in the modification of terms of the loan, such as changes in payment schedule or interest rate. Management measures impairment in accordance with FASB ASC 310, “Allowance for Credit Losses.” The fair value of the collateral is based upon an observable market price or current appraised value and therefore, the Company classifies these assets as nonrecurring Level 3. There were no non-accrual loans, loans delinquent 90 days or more and still accruing interest, or loans classified as troubled debt restructuring at March 31, 2019 or December 31, 2018.

There were no foreclosed loans recorded as other real estate owned (included in other assets) as of March 31, 2019 or December 31, 2018.

A summary of the activity in the allowance for loan losses from December 31, 2018 to March 31, 2019 is as follows:

	December 31,		Charge-						March 31,
*(In thousands)*	2018		Offs		Recoveries		Provision		2019
Commercial and industrial	$	4,179	$	—	$	11	$	529	$	4,719
Real estate
Commercial:
Mortgage		1,417		—		—		(33)		1,384
Construction		89		—		—		26		115
Church, church-related:
Mortgage		3,961		—		—		(51)		3,910
Construction		155		—		—		(27)		128
Other		424		—		—		(194)		230
Total	$	10,225	$	—	$	11	$	250	$	10,486

A summary of the activity in the allowance for loan losses from December 31, 2017 to March 31, 2018 is as follows:

	December 31,		Charge-						March 31,
*(In thousands)*	2017		Offs		Recoveries		Provision		2018
Commercial and industrial	$	3,652	$	—	$	5	$	320	$	3,977
Real estate
Commercial:
Mortgage		1,394		—		—		(53)		1,341
Construction		70		—		—		48		118
Church, church-related:
Mortgage		3,962		—		—		(106)		3,856
Construction		196		—		—		22		218
Industrial Revenue Bond		52		—		—		(12)		40
Other		879		—		—		(219)		660
Total	$	10,205	$	—	$	5	$	—	$	10,210