Allowance for Credit Losses (Tables)

3 Months Ended

Mar. 31, 2013

The following table shows the summary of activities for allowance for credit losses as of and for the three month periods ended March 31, 2013 and 2012 by portfolio segment (in thousands):



	Commercial			Real Estate			Consumer			Unallocated		Total
Allowance for credit losses:
Beginning balance, January 1, 2013	$	2,676		$	5,877		$	1,541		$	39	$	10,133
Provision charged to operations	241			(341		)	(238		)	338		—
Losses charged to allowance	(698		)	—			(17		)	—		(715		)
Recoveries	42			—			29			—		71
Ending balance, March 31, 2013	$	2,261		$	5,536		$	1,315		$	377	$	9,489

Allowance for credit losses:
Beginning balance, January 1, 2012	$	2,266		$	7,155		$	1,836		$	139	$	11,396
Provision charged to operations	485			(542		)	307			150		400
Losses charged to allowance	(106		)	(1,473		)	(90		)	—		(1,669		)
Recoveries	69			—			89			—		158
Ending balance, March 31, 2012	$	2,714		$	5,140		$	2,142		$	289	$	10,285

The following is a summary of the allowance for credit losses by impairment methodology and portfolio segment as of March 31, 2013 and December 31, 2012 (in thousands):



	Commercial		Real Estate		Consumer		Unallocated		Total
Allowance for credit losses:
Ending balance, March 31, 2013	$	2,261	$	5,536	1,315		$	377	$	9,489
Ending balance: individually evaluated for impairment	$	35	$	552	18		$	—	$	605
Ending balance: collectively evaluated for impairment	$	2,226	$	4,984	1,297		$	377	$	8,884

Ending balance, December 31, 2012	$	2,676	$	5,877	$	1,541	$	39	$	10,133
Ending balance: individually evaluated for impairment	$	40	$	465	$	5	$	—	$	510
Ending balance: collectively evaluated for impairment	$	2,636	$	5,412	$	1,536	$	39	$	9,623

Loans by impairment methdology

The following table shows the ending balances of loans as of March 31, 2013 and December 31, 2012 by portfolio segment and by impairment methodology (in thousands):



	Commercial		Real Estate		Consumer		Total
Loans:
Ending balance, March 31, 2013	$	101,395	$	242,505	$	47,372	$	391,272
Ending balance: individually evaluated for impairment	$	1,809	$	12,724	$	1,807	$	16,340
Ending balance: collectively evaluated for impairment	$	99,586	$	229,781	$	45,565	$	374,932

Loans:
Ending balance, December 31, 2012	$	104,555	$	237,938	$	53,278	$	395,771
Ending balance: individually evaluated for impairment	$	2,405	$	12,868	$	1,832	$	17,105
Ending balance: collectively evaluated for impairment	$	102,150	$	225,070	$	51,446	$	378,666

Loan portfolio by internal risk rating

The following table shows the loan portfolio by class allocated by management’s internal risk ratings at March 31, 2013 (in thousands):



	Pass		Special Mention		Substandard		Doubtful		Total
Commercial:
Commercial and industrial	$	67,308	$	1,796	$	6,407	$	—	$	75,511
Agricultural land and production	25,884		—		—		—		25,884
Real Estate:
Owner occupied	96,149		2,618		5,256		—		104,023
Real estate construction and other land loans	18,754		2,453		11,102		—		32,309
Commercial real estate	55,537		3,926		5,092		—		64,555
Agricultural real estate	29,849		1,878		—		—		31,727
Other real estate	9,891		—		—		—		9,891
Consumer:
Equity loans and lines of credit	34,989		2,380		2,121		—		39,490
Consumer and installment	7,803		69		10		—		7,882
Total	$	346,164	$	15,120	$	29,988	$	—	$	391,272

The following table shows the loan portfolio by class allocated by management’s internally assigned risk grade ratings at December 31, 2012 (in thousands):



	Pass		Special Mention		Substandard		Doubtful		Total
Commercial:
Commercial and industrial	$	71,125	$	824	$	6,007	$	—	$	77,956
Agricultural land and production	26,599		—		—		—		26,599
Real Estate:
Owner occupied	107,281		1,831		5,332		—		114,444
Real estate construction and other land loans	18,517		3,377		11,305		—		33,199
Commercial real estate	44,880		3,952		4,965		—		53,797
Agricultural real estate	26,883		1,517		—		—		28,400
Other real estate	8,098		—		—		—		8,098
Consumer:
Equity loans and lines of credit	40,527		258		2,147		—		42,932
Consumer and installment	10,259		77		10		—		10,346
Total	$	354,169	$	11,836	$	29,766	$	—	$	395,771

Loan portfolio by time past due

The following table shows an aging analysis of the loan portfolio by class and the time past due at March 31, 2013 (in thousands):



	30-59 Days Past Due		60-89 Days Past Due		Greater Than 90 Days Past Due		Total Past Due		Current		Total Loans		Recorded Investment > 90 Days Accruing		Non-accrual
Commercial:
Commercial and industrial	$	23	$	—	$	—	$	23	$	75,488	$	75,511	$	—	$	1,359
Agricultural land and production	—		—		—		—		25,884		25,884		—		—
Real estate:	—						—		—		—
Owner occupied	416		—		—		416		103,607		104,023		—		1,542
Real estate construction and other land loans	670		—		4,836		5,506		26,803		32,309		—		6,151
Commercial real estate	—		156		—		156		64,399		64,555		—		156
Agricultural real estate	—		—		—		—		31,727		31,727		—		—
Other real estate	—		—		—		—		9,891		9,891		—		—
Consumer:							—		—		—
Equity loans and lines of credit	—		—		—		—		39,490		39,490		—		1,807
Consumer and installment	21		—		—		21		7,861		7,882		—		—
Total	$	1,130	$	156	$	4,836	$	6,122	$	385,150	$	391,272	$	—	$	11,015

The following table shows an aging analysis of the loan portfolio by class and the time past due at December 31, 2012 (in thousands):



	30-59 Days Past Due		60-89 Days Past Due		Greater Than 90 Days Past Due		Total Past Due		Current		Total Loans		Recorded Investment > 90 Days Accruing		Non- accrual
Commercial:
Commercial and industrial	$	—	$	—	$	—	$	—	$	77,956	$	77,956	$	—	$	—
Agricultural land and production	—		—		—		—		26,599		26,599		—		—
Real estate:	—
Owner occupied	—		213		—		213		114,231		114,444		—		1,575
Real estate construction and other land loans	—		—		—		—		33,199		33,199		—		6,288
Commercial real estate	—		—		—		—		53,797		53,797		—		—
Agricultural real estate	—		—		—		—		28,400		28,400		—		—
Other real estate	—		—		—		—		8,098		8,098		—		—
Consumer:
Equity loans and lines of credit	—		—		—		—		42,932		42,932		—		1,832
Consumer and installment	27		—		—		27		10,319		10,346		—		—
Total	$	27	$	213	$	—	$	240	$	395,531	$	395,771	$	—	$	9,695

Impaired loans

The following table shows information related to impaired loans by class at March 31, 2013 (in thousands):



	Recorded Investment		Unpaid Principal Balance		Related Allowance
With no related allowance recorded:
Commercial:
Commercial and industrial	$	—	$	—	$	—
Agricultural land and production	—		—		—
Total commercial	—		—		—
Real estate:
Owner occupied	207		240		—
Real estate construction and other land loans	5,506		6,718		—
Commercial real estate	156		156		—
Agricultural real estate	—		—		—
Other real estate	—		—		—
Total real estate	5,869		7,114		—
Consumer:
Equity loans and lines of credit	1,738		2,083		—
Consumer and installment	—		—		—
Total consumer	1,738		2,083		—
Total with no related allowance recorded	7,607		9,197		—

With an allowance recorded:
Commercial:
Commercial and industrial	1,809		1,809		35
Agricultural land and production	—		—		—
Total commercial	1,809		1,809		35
Real estate:
Owner occupied	1,335		1,487		174
Real estate construction and other land loans	5,520		5,910		378
Commercial real estate	—		—		—
Agricultural real estate	—		—		—
Other real estate	—		—		—
Total real estate	6,855		7,397		552
Consumer:
Equity loans and lines of credit	69		73		18
Consumer and installment	—		—		—
Total consumer	69		73		18
Total with an allowance recorded	8,733		9,279		605
Total	$	16,340	$	18,476	$	605

The recorded investment in loans excludes accrued interest receivable and net loan origination fees, due to immateriality.

The following table shows information related to impaired loans by class at December 31, 2012 (in thousands):



	Recorded Investment		Unpaid Principal Balance		Related Allowance
With no related allowance recorded:
Commercial:
Commercial and industrial	$	—	$	—	$	—
Agricultural land and production	—		—		—
Total commercial	—		—		—
Real estate:
Owner occupied	—		—		—
Real estate construction and other land loans	1,352		1,888		—
Commercial real estate	—		—		—
Agricultural real estate	—		—		—
Other real estate	—		—		—
Total real estate	1,352		1,888		—
Consumer:
Equity loans and lines of credit	1,523		1,834		—
Consumer and installment	—		—		—
Total consumer	1,523		1,834		—
Total with no related allowance recorded	2,875		3,722		—

With an allowance recorded:
Commercial:
Commercial and industrial	2,405		2,405		40
Agricultural land and production	—		—		—
Total commercial	2,405		2,405		40
Real estate:
Owner occupied	1,575		1,733		165
Real estate construction and other land loans	9,941		10,875		300
Commercial real estate	—		—		—
Agricultural real estate	—		—		—
Other real estate	—		—		—
Total real estate	11,516		12,608		465
Consumer:
Equity loans and lines of credit	309		323		5
Consumer and installment	—		—		—
Total consumer	309		323		5
Total with an allowance recorded	14,230		15,336		510
Total	$	17,105	$	19,058	$	510

The recorded investment in loans excludes accrued interest receivable and net loan origination fees, due to immateriality.

The following presents by class, information related to the average recorded investment and interest income recognized on impaired loans for the three months ended March 31, 2013 and 2012 (in thousands):



	Three Months Ended March 31, 2013				Three Months Ended March 31, 2012
	Average Recorded Investment		Interest Income Recognized		Average Recorded Investment		Interest Income Recognized
With no related allowance recorded:
Commercial:
Commercial and industrial	$	558	$	—	$	1,666	$	—
Agricultural land and production	—		—		—		—
Total commercial	558		—		1,666		—
Real estate:
Owner occupied	835		—		227		—
Real estate construction and other land loans	5,007		—		4,990		—
Commercial real estate	26		—		—		—
Agricultural real estate	—		—		—		—
Other real estate	—		—		—		—
Total real estate	5,868		—		5,217		—
Consumer:
Equity loans and lines of credit	1,691		—		1,243		—
Consumer and installment	—		—		—		—
Total consumer	1,691		—		1,243		—
Total with no related allowance recorded	8,117		—		8,126		—

With an allowance recorded:
Commercial:
Commercial and industrial	1,821		33		1,514		71
Agricultural land and production	—		—		—		—
Total commercial	1,821		33		1,514		71
Real estate:
Owner occupied	747		—		1,009		—
Real estate construction and other land loans	6,480		86		3,704		99
Commercial real estate	—		—		—		—
Agricultural real estate	—		—		—		—
Other real estate	—		—		—		—
Total real estate	7,227		86		4,713		99
Consumer:
Equity loans and lines of credit	223		—		176		—
Consumer and installment	17		—		73		—
Total consumer	240		—		249		—
Total with an allowance recorded	9,288		119		6,476		170
Total	$	17,405	$	119	$	14,602	$	170