Allowance for Loan Losses (Tables)

3 Months Ended

Mar. 31, 2013

Allowance for Loan and Lease Losses, Provision for Loss, Net [Abstract]

Allowance for loan losses by class of financing receivable and allowance

A breakdown of the allowance for loan losses as of March 31, 2013, December 31, 2012, and March 31, 2012, by class of financing receivable and allowance element, is presented in the following tables:



As of March 31, 2013	Specific Reserves on Loans Evaluated Individually for Impairment		General Reserves on Loans Based on Historical Loss Experience		Reserves for Qualitative Factors		Unallocated Reserves		Total Reserves
Commercial
Real estate	$	1,473,000	$	2,177,000	$	2,229,000	$	—	$	5,879,000
Construction	760,000		150,000		154,000		—		1,064,000
Other	535,000		781,000		799,000		—		2,115,000
Municipal	—		—		18,000		—		18,000
Residential
Term	337,000		336,000		440,000		—		1,113,000
Construction	—		4,000		5,000		—		9,000
Home equity line of credit	—		522,000		337,000		—		859,000
Consumer	—		345,000		229,000		—		574,000
Unallocated	—		—		—		1,089,000		1,089,000
	$	3,105,000	$	4,315,000	$	4,211,000	$	1,089,000	$	12,720,000



As of December 31, 2012	Specific Reserves on Loans Evaluated Individually for Impairment		General Reserves on Loans Based on Historical Loss Experience		Reserves for Qualitative Factors		Unallocated Reserves		Total Reserves
Commercial
Real estate	$	1,523,000	$	2,369,000	$	1,973,000	$	—	$	5,865,000
Construction	969,000		213,000		177,000		—		1,359,000
Other	652,000		763,000		635,000		—		2,050,000
Municipal	—		—		18,000		—		18,000
Residential
Term	395,000		278,000		436,000		—		1,109,000
Construction	—		4,000		7,000		—		11,000
Home equity line of credit	—		315,000		339,000		—		654,000
Consumer	—		362,000		230,000		—		592,000
Unallocated	—		—		—		842,000		842,000
	$	3,539,000	$	4,304,000	$	3,815,000	$	842,000	$	12,500,000



As of March 31, 2012	Specific Reserves on Loans Evaluated Individually for Impairment		General Reserves on Loans Based on Historical Loss Experience		Reserves for Qualitative Factors		Unallocated Reserves		Total Reserves
Commercial
Real estate	$	944,000	$	2,648,000	$	2,270,000	$	—	$	5,862,000
Construction	117,000		316,000		271,000		—		704,000
Other	480,000		886,000		759,000		—		2,125,000
Municipal	—		—		19,000		—		19,000
Residential
Term	592,000		185,000		459,000		—		1,236,000
Construction	49,000		2,000		8,000		—		59,000
Home equity line of credit	156,000		176,000		350,000		—		682,000
Consumer	10,000		319,000		239,000		—		568,000
Unallocated	—		—		—		1,699,000		1,699,000
	$	2,348,000	$	4,532,000	$	4,375,000	$	1,699,000	$	12,954,000

Summary of Risk Ratings for Loans

The following table summarizes the risk ratings for the Company's commercial real estate, commercial construction, commercial other, and municipal loans as of March 31, 2013:



	Commercial Real Estate		Commercial Construction		Commercial Other		Municipal Loans		All Risk- Rated Loans
1 Strong	$	19,000	$	—	$	259,000	$	1,641,000	$	1,919,000
2 Above Average	12,288,000		271,000		6,262,000		7,589,000		26,410,000
3 Satisfactory	36,187,000		2,410,000		16,846,000		3,419,000		58,862,000
4 Average	103,957,000		9,505,000		32,430,000		2,368,000		148,260,000
5 Watch	37,703,000		22,000		15,679,000		—		53,404,000
6 OAEM	25,057,000		3,001,000		4,768,000		—		32,826,000
7 Substandard	34,530,000		1,881,000		13,628,000		—		50,039,000
8 Doubtful	439,000		—		2,000		—		441,000
Total	$	250,180,000	$	17,090,000	$	89,874,000	$	15,017,000	$	372,161,000

The following table summarizes the risk ratings for the Company's commercial real estate, commercial construction, commercial other, and municipal loans as of December 31, 2012:



	Commercial Real Estate		Commercial Construction		Commercial Other		Municipal Loans		All Risk- Rated Loans
1 Strong	$	19,000	$	—	$	271,000	$	1,731,000	$	2,021,000
2 Above Average	13,871,000		1,274,000		4,084,000		7,061,000		26,290,000
3 Satisfactory	34,454,000		2,312,000		14,578,000		3,487,000		54,831,000
4 Average	99,712,000		12,322,000		28,618,000		2,425,000		143,077,000
5 Watch	43,369,000		1,721,000		19,524,000		—		64,614,000
6 OAEM	26,302,000		79,000		5,300,000		—		31,681,000
7 Substandard	33,153,000		4,709,000		8,806,000		—		46,668,000
8 Doubtful	455,000		—		2,000		—		457,000
Total	$	251,335,000	$	22,417,000	$	81,183,000	$	14,704,000	$	369,639,000

The following table summarizes the risk ratings for the Company's commercial real estate, commercial construction, commercial other, and municipal loans as of March 31, 2012:



	Commercial Real Estate		Commercial Construction		Commercial Other		Municipal Loans		All Risk- Rated Loans
1 Strong	$	23,000	$	—	$	486,000	$	1,911,000	$	2,420,000
2 Above Average	19,788,000		—		4,418,000		7,602,000		31,808,000
3 Satisfactory	32,903,000		1,396,000		12,183,000		3,819,000		50,301,000
4 Average	105,446,000		19,130,000		31,412,000		2,629,000		158,617,000
5 Watch	42,680,000		3,530,000		19,473,000		—		65,683,000
6 OAEM	18,302,000		538,000		4,644,000		—		23,484,000
7 Substandard	34,887,000		6,234,000		12,158,000		—		53,279,000
8 Doubtful	679,000		—		693,000		—		1,372,000
Total	$	254,708,000	$	30,828,000	$	85,467,000	$	15,961,000	$	386,964,000

Allowance for Loan Losses Transactions

The following table presents allowance for loan losses activity by class for the three-months ended March 31, 2013, and allowance for loan loss balances by class and related loan balances by class as of March 31, 2013:



	Commercial						Municipal		Residential					Home Equity Line of Credit		Consumer		Unallocated		Total
	Real Estate		Construction		Other				Term		Construction
For the three months ended March 31, 2013
Beginning balance	$	5,865,000	$	1,359,000	$	2,050,000	$	18,000	$	1,109,000	$	11,000		$	654,000	$	592,000	$	842,000	$	12,500,000
Charge offs	54,000		403,000		288,000		—		200,000		—			362,000		127,000		—		1,434,000
Recoveries	—		—		103,000		—		2,000		—			1,000		48,000		—		154,000
Provision	68,000		108,000		250,000		—		202,000		(2,000		)	566,000		61,000		247,000		1,500,000
Ending balance	$	5,879,000	$	1,064,000	$	2,115,000	$	18,000	$	1,113,000	$	9,000		$	859,000	$	574,000	$	1,089,000	$	12,720,000
Allowance for loan losses as of March 31, 2013
Ending balance specifically evaluated for impairment	$	1,473,000	$	760,000	$	535,000	$	—	$	337,000	$	—		$	—	$	—	$	—	$	3,105,000
Ending balance collectively evaluated for impairment	$	4,406,000	$	304,000	$	1,580,000	$	18,000	$	776,000	$	9,000		$	859,000	$	574,000	$	1,089,000	$	9,615,000
Related loan balances as of March 31, 2013
Ending balance	$	250,180,000	$	17,090,000	$	89,874,000	$	15,017,000	$	376,029,000	$	4,222,000		$	96,536,000	$	14,529,000	$	—	$	863,477,000
Ending balance specifically evaluated for impairment	$	17,534,000	$	2,347,000	$	5,550,000	$	—	$	20,262,000	$	—		$	1,683,000	$	—	$	—	$	47,376,000
Ending balance collectively evaluated for impairment	$	232,646,000	$	14,743,000	$	84,324,000	$	15,017,000	$	355,767,000	$	4,222,000		$	94,853,000	$	14,529,000	$	—	$	816,101,000

The following table presents allowance for loan losses activity by class for the year-ended December 31, 2012 and allowance for loan loss balances by class and related loan balances by class as of December 31, 2012:



	Commercial						Municipal			Residential				Home Equity Line of Credit		Consumer		Unallocated			Total
	Real Estate		Construction		Other					Term		Construction
For the year ended December 31, 2012
Beginning balance	$	5,659,000	$	658,000	$	2,063,000	$	19,000		$	1,159,000	$	255,000	$	595,000	$	584,000	$	2,008,000		$	13,000,000
Charge offs	1,394,000		928,000		3,215,000		—			1,911,000		389,000		688,000		555,000		—			9,080,000
Recoveries	13,000		246,000		113,000		—			110,000		54,000		1,000		208,000		—			745,000
Provision	1,587,000		1,383,000		3,089,000		(1,000		)	1,751,000		91,000		746,000		355,000		(1,166,000		)	7,835,000
Ending balance	$	5,865,000	$	1,359,000	$	2,050,000	$	18,000		$	1,109,000	$	11,000	$	654,000	$	592,000	$	842,000		$	12,500,000
Allowance for loan losses as of December 31, 2012
Ending balance specifically evaluated for impairment	$	1,523,000	$	969,000	$	652,000	$	—		$	395,000	$	—	$	—	$	—	$	—		$	3,539,000
Ending balance collectively evaluated for impairment	$	4,342,000	$	390,000	$	1,398,000	$	18,000		$	714,000	$	11,000	$	654,000	$	592,000	$	842,000		$	8,961,000
Related loan balances as of December 31, 2012
Ending balance	$	251,335,000	$	22,417,000	$	81,183,000	$	14,704,000		$	379,447,000	$	6,459,000	$	99,082,000	$	14,657,000	$	—		$	869,284,000
Ending balance specifically evaluated for impairment	$	15,774,000	$	3,354,000	$	5,861,000	$	—		$	19,444,000	$	—	$	1,311,000	$	—	$	—		$	45,744,000
Ending balance collectively evaluated for impairment	$	235,561,000	$	19,063,000	$	75,322,000	$	14,704,000		$	360,003,000	$	6,459,000	$	97,771,000	$	14,657,000	$	—		$	823,540,000

The following table presents allowance for loan losses activity by class for the three-months ended March 31, 2012 , and allowance for loan loss balances by class and related loan balances by class as of March 31, 2012:



	Commercial							Municipal		Residential					Home Equity Line of Credit		Consumer		Unallocated			Total
	Real Estate		Construction			Other				Term		Construction
For the three months ended March 31, 2012
Beginning balance	$	5,659,000	$	658,000		$	2,063,000	$	19,000	$	1,159,000	$	255,000		$	595,000	$	584,000	$	2,008,000		$	13,000,000
Charge offs	—		—			2,002,000		—		239,000		—			49,000		180,000		—			2,470,000
Recoveries	—		246,000			2,000		—		1,000		—			—		75,000		—			324,000
Provision	203,000		(200,000		)	2,062,000		—		315,000		(196,000		)	136,000		89,000		(309,000		)	2,100,000
Ending balance	$	5,862,000	$	704,000		$	2,125,000	$	19,000	$	1,236,000	$	59,000		$	682,000	$	568,000	$	1,699,000		$	12,954,000
Allowance for loan losses as of March 31, 2012
Ending balance specifically evaluated for impairment	$	944,000	$	117,000		$	480,000	$	—	$	592,000	$	49,000		$	156,000	$	10,000	$	—		$	2,348,000
Ending balance collectively evaluated for impairment	$	4,918,000	$	587,000		$	1,645,000	$	19,000	$	644,000	$	10,000		$	526,000	$	558,000	$	1,699,000		$	10,606,000
Related loan balances as of March 31, 2012
Ending balance	$	254,708,000	$	30,828,000		$	85,467,000	$	15,961,000	$	358,394,000	$	6,451,000		$	103,372,000	$	15,711,000	$	—		$	870,892,000
Ending balance specifically evaluated for impairment	$	14,295,000	$	2,093,000		$	3,886,000	$	—	$	18,054,000	$	1,454,000		$	1,336,000	$	15,000	$	—		$	41,133,000
Ending balance collectively evaluated for impairment	$	240,413,000	$	28,735,000		$	81,581,000	$	15,961,000	$	340,340,000	$	4,997,000		$	102,036,000	$	15,696,000	$	—		$	829,759,000

Troubled debt restructurings by class and specific reserve

The following table shows TDRs by class and the specific reserve as of March 31, 2013:



	Number of Loans	Balance		Specific Reserves
Commercial
Real estate	20	$	13,715,000	$	313,000
Construction	3	2,317,000		1,194,000
Other	24	3,063,000		40,000
Municipal	—	—		—
Residential
Term	54	11,195,000		1,034,000
Construction	—	—		—
Home equity line of credit	5	857,000		9,000
Consumer	—	—		—
	106	$	31,147,000	$	2,590,000

The following table shows TDRs by class and the specific reserve as of December 31, 2012:



	Number of Loans	Balance		Specific Reserves
Commercial
Real estate	18	$	11,961,000	$	823,000
Construction	3	3,319,000		969,000
Other	23	3,074,000		574,000
Municipal	—	—		—
Residential
Term	53	10,945,000		224,000
Construction	—	—		—
Home equity line of credit	4	656,000		—
Consumer	—	—		—
	101	$	29,955,000	$	2,590,000

The following table shows TDRs by class and the specific reserve as of March 31, 2012:



	Number of Loans	Balance		Specific Reserves
Commercial
Real estate	12	$	7,610,000	$	271,000
Construction	1	1,148,000		—
Other	12	1,919,000		85,000
Municipal	—	—		—
Residential
Term	46	9,970,000		250,000
Construction	—	—		—
Home equity line of credit	—	—		—
Consumer	—	—		—
	71	$	20,647,000	$	606,000

Loans placed on troubled debt restructurings by class and specific reserve

The following table shows these TDRs by class and the associated specific reserves included in the allowance for loan losses as of March 31, 2013:



	Number of Loans	Balance		Specific Reserves
Commercial
Real estate	2	$	409,000	$	—
Construction	—	—		—
Other	—	—		—
Municipal	—	—		—
Residential
Term	9	2,094,000		421,000
Construction	—	—		—
Home equity line of credit	—	—		—
Consumer	—	—		—
	11	$	2,503,000	$	421,000

As of March 31, 2012, 11 of the loans classified as TDRs with a total balance of $2,258,000 were more than 30 days past due. Of these loans, 7 loans with an outstanding balance of $1,733,000 had been placed on TDR status in the previous 12 months. The following table shows these TDRs by class and the associated specific reserves included in the allowance for loan losses as of March 31, 2012:



	Number of Loans	Balance		Specific Reserves
Commercial
Real estate	—	$	—	$	—
Construction	—	—		—
Other	4	667,000		44,000
Municipal	—	—		—
Residential
Term	7	1,591,000		29,000
Construction	—	—		—
Home equity line of credit	—	—		—
Consumer	—	—		—
	11	$	2,258,000	$	73,000

For the three months ended March 31, 2013, 7 loans were placed on TDR status with an outstanding balance of $2,948,000, this compares to 14 loans placed on TDR status with an outstanding balance of $3,007,000 for the three months ended March 31, 2012. These were considered TDRs because concessions had been granted to borrowers experiencing financial difficulties. Concessions include reductions in interest rates, principal and/or interest forbearance, payment extensions, or combinations thereof.

The following table shows loans placed on TDR status in the three months ended March 31, 2013 and 2012, by class of loan and the associated specific reserve included in the allowance for loan losses as of March 31, 2013 and 2012:



Three months ended March 31, 2013	Number of Loans	Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment		Specific Reserves
Commercial
Real estate	2	$	1,897,000	$	1,897,000	$	—
Construction	—	—		—		—
Other	3	536,000		546,000		40,000
Municipal	—	—		—		—
Residential
Term	1	312,000		312,000		—
Construction	—	—		—		—
Home equity line of credit	1	203,000		204,000		—
Consumer	—	—		—		—
	7	$	2,948,000	$	2,959,000	$	40,000



Three months ended March 31, 2012	Number of Loans	Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment		Specific Reserves
Commercial
Real estate	7	$	2,438,000	$	2,404,000	$	—
Construction	—	—		—		—
Other	3	12,000		12,000		—
Municipal	—	—		—		—
Residential
Term	4	557,000		557,000		16,000
Construction	—	—		—		—
Home equity line of credit	—	—		—		—
Consumer	—	—		—		—
	14	$	3,007,000	$	2,973,000	$	16,000