Loans and Allowance for Loan Losses (Tables)

6 Months Ended

Jun. 30, 2019

Financing Receivable, Allowance for Credit Loss [Line Items]

Schedule of Composition of Loan Portfolio

The following table summarizes the composition of our loan portfolio. Total gross loans are recorded net of deferred loan fees and costs, which totaled $2.9 million as of June 30, 2019 and $2.8 million as of December 31, 2018.


	June 30, 2019					December 31, 2018
(dollars in thousands)	Amount			% of Total		Amount			% of Total
Commercial
Owner occupied RE	$	390,727		21.6	%	$	367,018		21.9	%
Non-owner occupied RE		455,346		25.2	%		404,296		24.1	%
Construction		85,065		4.7	%		84,411		5.0	%
Business		292,564		16.2	%		272,980		16.3	%
Total commercial loans		1,223,702		67.7	%		1,128,705		67.3	%
Consumer
Real estate		342,100		18.9	%		320,943		19.1	%
Home equity		170,861		9.4	%		165,937		9.9	%
Construction		46,247		2.6	%		37,925		2.3	%
Other		26,445		1.4	%		23,822		1.4	%
Total consumer loans		585,653		32.3	%		548,627		32.7	%
Total gross loans, net of deferred fees		1,809,355		100.0	%		1,677,332		100.0	%
Less—allowance for loan losses		(16,144	)				(15,762	)
Total loans, net	$	1,793,211				$	1,661,570

Schedule of Loan Maturity Distribution by Type and Related Interest Rate

The information in the following tables summarizes the loan maturity distribution by type and related interest rate characteristics based on the contractual maturities of individual loans, including loans which may be subject to renewal at their contractual maturity. Renewal of such loans is subject to review and credit approval, as well as modification of terms upon maturity. Actual repayments of loans may differ from the maturities reflected below, because borrowers have the right to prepay obligations with or without prepayment penalties.


	June 30, 2019
			After one
	One year		but within	After five
(dollars in thousands)	or less		five years	years	Total
Commercial
Owner occupied RE	$	21,628	161,881	207,218		390,727
Non-owner occupied RE		50,516	268,178	136,652		455,346
Construction		23,222	28,283	33,560		85,065
Business		84,902	144,493	63,169		292,564
Total commercial loans		180,268	602,835	440,599		1,223,702
Consumer
Real estate		24,866	77,323	239,911		342,100
Home equity		10,700	24,353	135,808		170,861
Construction		16,216	872	29,159		46,247
Other		7,617	14,294	4,534		26,445
Total consumer loans		59,399	116,842	409,412		585,653
Total gross loans, net of deferred fees	$	239,667	719,677	850,011		1,809,355
Loans maturing after one year with:
Fixed interest rates					$	1,198,490
Floating interest rates						371,198

				December 31, 2018
			After one
		One year	but within	After five
(dollars in thousands)		or less	five years	years		Total
Commercial
Owner occupied RE	$	20,839	165,436	180,743		367,018
Non-owner occupied RE		43,000	227,454	133,842		404,296
Construction		22,941	33,045	28,425		84,411
Business		80,672	128,911	63,397		272,980
Total commercial loans		167,452	554,846	406,407		1,128,705
Consumer
Real estate		29,301	70,467	221,175		320,943
Home equity		8,867	24,618	132,452		165,937
Construction		16,006	1,646	20,273		37,925
Other		7,681	11,253	4,888		23,822
Total consumer		61,855	107,984	378,788		548,627
Total gross loan, net of deferred fees	$	229,307	662,830	785,195		1,677,332
Loans maturing after one year with:
Fixed interest rates					$	1,100,854
Floating interest rates						347,171

Schedule of Nonperforming Assets, Including Nonaccruing TDRs

Following is a summary of our nonperforming assets, including nonaccruing TDRs.


(dollars in thousands)	June 30, 2019			December 31, 2018
Commercial
Owner occupied RE	$	-		-
Non-owner occupied RE		372		210
Construction		-		-
Business		65		81
Consumer
Real estate		1,710		1,980
Home equity		442		1,006
Construction		-		-
Other		-		12
Nonaccruing troubled debt restructurings		3,220		2,541
Total nonaccrual loans, including nonaccruing TDRs		5,809		5,830
Other real estate owned		-		-
Total nonperforming assets	$	5,809		5,830
Nonperforming assets as a percentage of:
Total assets		0.27	%	0.31	%
Gross loans		0.32	%	0.35	%
Total loans over 90 days past due		1,758		458
Loans over 90 days past due and still accruing		-		-
Accruing troubled debt restructurings	$	6,935		6,742

Schedule of Key Information for Impaired Loans

The table below summarizes key information for impaired loans. The Company’s impaired loans include loans on nonaccrual status and loans modified in a TDR, whether on accrual or nonaccrual status. These impaired loans may have estimated impairment which is included in the allowance for loan losses. The Company’s commercial and consumer impaired loans are evaluated individually to determine the related allowance for loan losses.


			June 30, 2019
			Recorded investment
				Impaired loans
	Unpaid			with related	Related
	Principal		Impaired	allowance for	allowance for
(dollars in thousands)	Balance		loans	loan losses	loan losses
Commercial
Owner occupied RE	$	3,171	3,107	447	75
Non-owner occupied RE		2,870	2,507	1,706	532
Construction		-	-	-	-
Business		3,359	2,713	2,118	884
Total commercial		9,400	8,327	4,271	1,491
Consumer
Real estate		2,619	2,612	1,776	466
Home equity		2,197	1,651	270	71
Construction		-	-	-	-
Other		154	154	154	17
Total consumer		4,970	4,417	2,201	554
Total	$	14,370	12,744	6,472	2,045

			December 31, 2018
			Recorded investment
				Impaired loans
	Unpaid			with related	Related
	Principal		Impaired	allowance for	allowance for
(dollars in thousands)	Balance		loans	loan losses	loan losses
Commercial
Owner occupied RE	$	2,827	2,762	451	75
Non-owner occupied RE		3,321	2,807	2,204	558
Construction		-	-	-	-
Business		3,745	2,520	2,005	895
Total commercial		9,893	8,089	4,660	1,528
Consumer
Real estate		2,993	2,892	1,398	456
Home equity		1,935	1,421	-	-
Construction		-	-	-	-
Other		170	170	170	30
Total consumer		5,098	4,483	1,568	486
Total	$	14,991	12,572	6,228	2,014

Schedule of Average Recorded Investment and Interest Income Recognized on Impaired Loans

The following table provides the average recorded investment in impaired loans and the amount of interest income recognized on impaired loans after impairment by portfolio segment and class.


				Three months ended			Three months ended
				June 30, 2019			June 30, 2018
				Average		Recognized	Average	Recognized
				recorded		interest	recorded	interest
(dollars in thousands)				investment		income	investment	income
Commercial
Owner occupied RE				$	3,116	44	2,800	45
Non-owner occupied RE					2,544	41	3,878	77
Construction					-	-	-	-
Business					2,728	37	3,361	57
Total commercial					8,388	122	10,039	179
Consumer
Real estate					2,622	20	2,892	40
Home equity					1,659	21	2,135	24
Construction					-	-	-	-
Other					155	1	165	1
Total consumer					4,436	42	5,192	65
Total				$	12,824	164	15,231	244

	Six months ended			Six months ended			Year ended
	June 30, 2019			June 30, 2018			December 31, 2018
	Average		Recognized	Average		Recognized	Average	Recognized
	recorded		interest	recorded		interest	recorded	interest
(dollars in thousands)	investment		income	investment		income	investment	income
Commercial
Owner occupied RE	$	3,123	79		2,804	62	2,784	142
Non-owner occupied RE		2,565	85		3,920	126	2,860	174
Construction		-	-		-	-	-	-
Business		2,700	77		3,380	79	2,883	162
Total commercial		8,388	241		10,104	267	8,527	478
Consumer
Real estate		2,633	45		2,911	81	2,930	151
Home equity		1,670	51		2,172	51	1,453	99
Construction		-	-		-	-	-	-
Other		156	2		167	3	174	5
Total consumer		4,459	98		5,250	135	4,557	255
Total	$	12,847	339		15,354	402	13,084	733

Schedule of Allowance for Loan Losses by Commercial and Consumer Portfolio Segments

The following table summarizes the activity related to the allowance for loan losses by commercial and consumer portfolio segments:


	Three months ended June 30, 2019
	Commercial									Consumer
	Owner			Non-owner
	occupied			occupied						Real		Home
(dollars in thousands)	RE			RE		Construction		Business		Estate		equity		Construction	Other		Total
Balance, beginning of period	$	2,783		3,886		572		3,796		3,041		1,410		282	281		16,051
Provision for loan losses		135		143		(3	)	(181	)	49		98		36	23		300
Loan charge-offs		(110	)	(13	)	-		-		-		(100	)	-	(14	)	(237	)
Loan recoveries		-		-		-		8		14		1		-	7		30
Net loan charge-offs		(110	)	(13	)	-		8		14		(99	)	-	(7	)	(207	)
Balance, end of period	$	2,808		4,016		569		3,623		3,104		1,409		318	297		16,144
Net charge-offs to average loans (annualized)																	0.05	%
Allowance for loan losses to gross loans																	0.89	%
Allowance for loan losses to nonperforming loans																	277.92	%

	Three months ended June 30, 2018
	Commercial									Consumer
	Owner			Non-owner
	occupied			occupied						Real		Home
(dollars in thousands)	RE			RE		Construction		Business		Estate		equity		Construction	Other		Total
Balance, beginning of period	$	2,680		3,366		415		3,553		3,391		1,911		256	280		15,852
Provision for loan losses		19		342		129		280		54		(438	)	26	(12	)	400
Loan charge-offs		-		(234	)	-		-		-		(77	)	-	-		(311	)
Loan recoveries		-		107		-		16		1		35		-	-		159
Net loan charge-offs		-		(127	)	-		16		1		(42	)	-	-		(152	)
Balance, end of period	$	2,699		3,581		544		3,849		3,446		1,431		282	268		16,100
Net charge-offs to average loans (annualized)																	0.04	%
Allowance for loan losses to gross loans																	1.05	%
Allowance for loan losses to nonperforming loans																	208.52	%

	Six months ended June 30, 2019
	Commercial									Consumer
	Owner			Non-owner
	occupied			occupied						Real		Home
(dollars in thousands)	RE			RE		Construction		Business		Estate		equity		Construction	Other		Total
Balance, beginning of period	$	2,726		3,811		615		3,616		3,081		1,348		275	290		15,762
Provision for loan losses		192		217		(46	)	(10	)	(6	)	160		43	50		600
Loan charge-offs		(110	)	(14	)	-		-		-		(100	)	-	(53	)	(277	)
Loan recoveries		-		2		-		17		29		1		-	10		59
Net loan charge-offs		(110	)	(12	)	-		17		29		(99	)	-	(43	)	(218	)
Balance, end of period	$	2,808		4,016		569		3,623		3,104		1,409		318	297		16,144
Net charge-offs to average loans (annualized)																	0.03	%

	Six months ended June 30, 2018
	Commercial									Consumer
	Owner			Non-owner
	occupied			occupied						Real		Home
	RE			RE		Construction		Business		Estate		equity		Construction	Other		Total
Balance, beginning of period	$	2,534		3,230		325		3,848		3,495		1,600		210	281		15,523
Provision for loan losses		165		478		219		(14	)	25		(64	)	72	19		900
Loan charge-offs		-		(234	)	-		(119	)	(77	)	(140	)	-	(34	)	(604	)
Loan recoveries		-		107		-		134		3		35		-	2		281
Net loan charge-offs		-		(127	)	-		15		(74	)	(105	)	-	(32	)	(323	)
Balance, end of period	$	2,699		3,581		544		3,849		3,446		1,431		282	268		16,100
Net charge-offs to average loans (annualized)																	0.04	%

Schedule of Allowance for Loan Losses and Recorded Investment in Loans by Impairment

The following table disaggregates the allowance for loan losses and recorded investment in loans by impairment methodology.


	June 30, 2019
	Allowance for loan losses				Recorded investment in loans
(dollars in thousands)	Commercial		Consumer	Total	Commercial	Consumer	Total
Individually evaluated	$	1,491	554	2,045	8,327	4,417	12,744
Collectively evaluated		9,525	4,574	14,099	1,215,375	581,236	1,796,611
Total	$	11,016	5,128	16,144	1,223,702	585,653	1,809,355

						December 31, 2018
	Allowance for loan losses				Recorded investment in loans
(dollars in thousands)	Commercial		Consumer	Total	Commercial	Consumer	Total
Individually evaluated	$	1,528	486	2,014	8,089	4,483	12,572
Collectively evaluated		9,240	4,508	13,748	1,120,616	544,144	1,664,760
Total	$	10,768	4,994	15,762	1,128,705	548,627	1,677,332

Consumer Loan [Member]

Financing Receivable, Allowance for Credit Loss [Line Items]

Summary of breakdown of outstanding loans by risk category

The tables below provide a breakdown of outstanding consumer loans by risk category.


	June 30, 2019
(dollars in thousands)	Real estate		Home equity	Construction	Other	Total
Pass	$	335,618	167,670	46,247	26,322	575,857
Special mention		2,818	256	-	99	3,173
Substandard		3,664	2,935	-	24	6,623
Doubtful		-	-	-	-	-
	$	342,100	170,861	46,247	26,445	585,653

	December 31, 2018
(dollars in thousands)		Real estate	Home equity	Construction	Other	Total
Pass	$	314,586	162,626	37,925	23,586	538,723
Special mention		1,792	864	-	139	2,795
Substandard		4,565	2,447	-	97	7,109
Doubtful		-	-	-	-	-
	$	320,943	165,937	37,925	23,822	548,627

Summary of outstanding commercial and consumer loans which include loans on nonaccrual by past due status

The following tables provide past due information for outstanding consumer loans and include loans on nonaccrual status as well as accruing TDRs.


	June 30, 2019
(dollars in thousands)	Real estate		Home equity	Construction	Other	Total
Current	$	339,686	169,686	46,247	26,417	582,036
30-59 days past due		674	604	-	28	1,306
60-89 days past due		247	371	-	-	618
Greater than 90 Days		1,493	200	-	-	1,693
	$	342,100	170,861	46,247	26,445	585,653

	December 31, 2018
(dollars in thousands)	Real estate		Home equity	Construction	Other	Total
Current	$	317,267	165,727	37,925	23,603	544,522
30-59 days past due		2,555	30	-	106	2,691
60-89 days past due		923	-	-	113	1,036
Greater than 90 Days		198	180	-	-	378
	$	320,943	165,937	37,925	23,822	548,627

Commercial Loan [Member]

Financing Receivable, Allowance for Credit Loss [Line Items]

Summary of breakdown of outstanding loans by risk category

The tables below provide a breakdown of outstanding commercial loans by risk category.


	June 30, 2019
	Owner		Non-owner
(dollars in thousands)	occupied RE		occupied RE	Construction	Business	Total
Pass	$	386,489	447,808	84,998	286,387	1,205,682
Special mention		1,850	4,194	67	1,969	8,080
Substandard		2,388	3,344	-	4,208	9,940
Doubtful		-	-	-	-	-
	$	390,727	455,346	85,065	292,564	1,223,702

	December 31, 2018
	Owner		Non-owner
(dollars in thousands)	occupied RE		occupied RE	Construction	Business	Total
Pass	$	363,621	400,266	84,411	266,898	1,115,196
Special mention		296	118	-	2,971	3,385
Substandard		3,101	3,912	-	3,111	10,124
Doubtful		-	-	-	-	-
	$	367,018	404,296	84,411	272,980	1,128,705

Summary of outstanding commercial and consumer loans which include loans on nonaccrual by past due status

The following tables provide past due information for outstanding commercial loans and include loans on nonaccrual status as well as accruing TDRs.


	June 30, 2019
	Owner		Non-owner
(dollars in thousands)	occupied RE		occupied RE	Construction	Business	Total
Current	$	390,538	454,930	85,065	292,284	1,222,817
30-59 days past due		189	206	-	38	433
60-89 days past due		-	210	-	177	387
Greater than 90 Days		-	-	-	65	65
	$	390,727	455,346	85,065	292,564	1,223,702

	December 31, 2018
	Owner		Non-owner
	occupied RE		occupied RE	Construction	Business	Total
Current	$	367,018	404,179	84,411	272,864	1,128,472
30-59 days past due		-	117	-	36	153
60-89 days past due		-	-	-	-	-
Greater than 90 Days		-	-	-	80	80
	$	367,018	404,296	84,411	272,980	1,128,705