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Loans and Allowance for Loan Losses
 6 Months Ended
Jun. 30, 2012
Loans and Allowance for Loan Losses [Abstract]  
Loans and Allowance for Loan Losses
(2) Loans and Allowance for Loan Losses

A summary of loans, by major class within our Company’s loan portfolio, at June 30, 2012 and December 31, 2011 are as follows:

 

                 
    June 30,     December 31,  
    2012     2011  

Commercial, financial, and agricultural

   $ 128,857,496     $ 128,555,173  

Real estate construction - residential

     19,830,700       30,201,198  

Real estate construction - commercial

     42,841,472       47,696,759  

Real estate mortgage - residential

     220,334,153       203,454,204  

Real estate mortgage - commercial

     404,469,004       402,960,327  

Installment and other consumer

     27,591,103       29,883,986  

Unamortized loan origination fees and costs, net

     181,055       178,901  
   

 

 

    

 

 

  
     

Total loans

   $ 844,104,983     $ 842,930,548  
   

 

 

    

 

 

  

The Bank grants real estate, commercial, installment, and other consumer loans to customers located within the communities surrounding Jefferson City, Clinton, Warsaw, Springfield, Branson and Lee’s Summit, Missouri. As such, the Bank is susceptible to changes in the economic environment in these communities. The Bank does not have a concentration of credit in any one economic sector. Installment and other consumer loans consist primarily of the financing of vehicles. At June 30, 2012, loans with a carrying value of $453,772,000 were pledged to Federal Home Loan Bank as collateral for borrowings and letters of credit.

 

Allowance for loan losses

The following is a summary of the allowance for loan losses for the three and six months ended June 30, 2012 and 2011:

 

                                                                 
    For the Three Months Ended June 30, 2012  

(in thousands)

   Commercial,
Financial, and
Agricultural		     Real Estate
Construction -
Residential		     Real Estate
Construction -
Commercial		     Real Estate
Mortgage -
Residential		     Real Estate
Mortgage -
Commercial		     Installment
Loans to
Individuals		     Unallocated     Total  
                 

Balance, beginning of period

   $ 2,722     $ 727     $ 1,410     $ 3,563     $ 5,976     $ 237     $ 5     $ 14,640  
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Additions:

                                                                

Provision for loan losses

     363       (54 )      211       380       525       63       12       1,500  
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Deductions:

                                                                

Loans charged off

     69       —         —         422       438       132       —         1,061  

Less recoveries on loans

     (29 )      (36 )      (23 )      (39 )     (44 )     (64 )     —         (235 )
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net loans charged off

     40       (36 )      (23 )      383       394       68       —         826  
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Balance, end of period

   $ 3,045     $ 709     $ 1,644     $ 3,560     $ 6,107     $ 232     $ 17     $ 15,314  
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

                                                                 
    For the Six Months Ended June 30, 2012  

(in thousands)

   Commercial,
Financial, and
Agricultural		     Real Estate
Construction -
Residential		     Real Estate
Construction -
Commercial		     Real Estate
Mortgage  -
Residential		     Real Estate
Mortgage -
Commercial		     Installment
Loans to
Individuals		     Unallocated     Total  
                 

Balance, beginning of period

   $ 1,804     $ 1,188     $ 1,562     $ 3,251     $ 5,734     $ 267     $ 3     $ 13,809  
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Additions:

                                                                

Provision for loan losses

     1,230       (546 )      59       795       1,552       96       14       3,200  
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Deductions:

                                                                

Loans charged off

     104       —         —         577       1,300       271       —         2,252  

Less recoveries on loans

     (115 )      (67 )      (23 )      (91 )     (121 )     (140 )     —         (557 )
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net loans charged off

     (11 )      (67 )      (23 )      486       1,179       131       —         1,695  
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Balance, end of period

   $ 3,045     $ 709     $ 1,644     $ 3,560     $ 6,107     $ 232     $ 17     $ 15,314  
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

                                                                 
    For the Three Months Ended June 30, 2011  

(in thousands)

   Commercial,
Financial, and
Agricultural		     Real Estate
Construction -
Residential		     Real Estate
Construction -
Commercial		     Real Estate
Mortgage -
Residential		     Real Estate
Mortgage -
Commercial		     Installment
Loans to
Individuals		     Unallocated     Total  
                 

Balance, beginning of period

   $ 2,257     $ 991     $ 1,356     $ 3,118     $ 3,709     $ 223     $ 748     $ 12,402  
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Additions:

                                                                

Provision for loan losses

     313       (6 )      (276 )      306       1,264       62       220       1,883  
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Deductions:

                                                                

Loans charged off

     45       —         —         466       160       138       —         809  

Less recoveries on loans

     (8 )      (1 )      (250 )      (32 )     (24 )     (72 )     —         (387 )
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net loans charged off

     37       (1 )      (250 )      434       136       66       —         422  
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Balance, end of period

   $ 2,533     $ 986     $ 1,330     $ 2,990     $ 4,837     $ 219     $ 968     $ 13,863  
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

                                                                 
    For the Six Months Ended June 30, 2011  

(in thousands)

   Commercial,
Financial, and
Agricultural		     Real Estate
Construction -
Residential		     Real Estate
Construction -
Commercial		     Real Estate
Mortgage -
Residential		     Real Estate
Mortgage -
Commercial		     Installment
Loans to
Individuals		     Unallocated     Total  
                 

Balance, beginning of period

   $ 2,931     $ 2,067     $ 1,339     $ 3,922     $ 3,458     $ 231     $ 617     $ 14,565  
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Additions:

                                                                

Provision for loan losses

     406       404       (259 )      533       2,091       107       351       3,633  
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Deductions:

                                                                

Loans charged off

     873       1,547       —         1,539       741       247       —         4,947  

Less recoveries on loans

     (69 )      (62 )      (250 )      (74 )     (29 )     (128 )     —         (612 )
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net loans charged off

     804       1,485       (250 )      1,465       712       119       —         4,335  
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Balance, end of period

   $ 2,533     $ 986     $ 1,330     $ 2,990     $ 4,837     $ 219     $ 968     $ 13,863  
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

The following table provides the balance in the allowance for loan losses at June 30, 2012 and December 31, 2011, and the related loan balance by impairment methodology. Loans evaluated under ASC 310-10-35 include loans on non-accrual status, which are individually evaluated for impairment, troubled debt restructurings, and other impaired loans deemed to have similar risk characteristics. All other loans are collectively evaluated for impairment under ASC 450-20. Although the allowance for loan losses is comprised of specific and general allocations, the entire allowance is available to absorb credit losses.

 

                                                                 
    Commercial,
Financial, and
Agricultural		     Real Estate
Construction -
Residential		     Real Estate
Construction -
Commercial		     Real Estate
Mortgage -
Residential		     Real Estate
Mortgage -
Commercial		     Installment
Loans to
Individuals		     Unallocated     Total  

June 30, 2012

                                                                
                 

Allowance for loan losses:

                                                                

Individually evaluated for impairment

   $ 1,595,235     $ 59,493     $ 576,373     $ 720,537     $ 2,141,184     $ —       $ —       $ 5,092,822  

Collectively evaluated for impairment

     1,449,561       650,002       1,067,655       2,838,972       3,966,186       231,593       16,793       10,220,762  
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Total

   $ 3,044,796     $ 709,495     $ 1,644,028     $ 3,559,509     $ 6,107,370     $ 231,593     $ 16,793     $ 15,313,584  
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  
                 

Loans outstanding:

                                                                

Individually evaluated for impairment

   $ 6,385,611     $ 280,267     $ 8,008,355     $ 4,979,777     $ 25,106,094     $ —       $ —       $ 44,760,104  

Collectively evaluated for impairment

     122,471,885       19,550,433       34,833,117       215,354,376       379,362,910       27,772,158       —         799,344,879  
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Total

   $ 128,857,496     $ 19,830,700     $ 42,841,472     $ 220,334,153     $ 404,469,004     $ 27,772,158     $ —       $ 844,104,983  
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  
                 

December 31, 2011

                                                                
                 

Allowance for loan losses:

                                                                

Individually evaluated for impairment

   $ 238,840     $ 166,300     $ 379,921     $ 653,279     $ 2,309,226     $ —       $ —       $ 3,747,566  

Collectively evaluated for impairment

     1,565,342       1,021,221       1,182,057       2,598,203       3,424,849       266,990       2,996       10,061,658  
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Total

   $ 1,804,182     $ 1,187,521     $ 1,561,978     $ 3,251,482     $ 5,734,075     $ 266,990     $ 2,996     $ 13,809,224  
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Loans outstanding:

                                                                

Individually evaluated for impairment

   $ 4,427,673     $ 1,146,794     $ 7,867,059     $ 6,569,367     $ 33,440,384     $ —       $ —       $ 53,451,277  

Collectively evaluated for impairment

     124,127,500       29,054,404       39,829,700       196,884,837       369,519,943       30,062,887       —         789,479,271  
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Total

   $ 128,555,173     $ 30,201,198     $ 47,696,759     $ 203,454,204     $ 402,960,327     $ 30,062,887     $ —       $ 842,930,548  
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Loans, or portions of loans, are charged off to the extent deemed uncollectible. Loan charge-offs reduce the allowance for loan losses, and recoveries of loans previously charged off are added back to the allowance. Once the fair value for a collateral dependent loan has been determined, any impaired amount is typically charged off unless the loan has other income streams to support repayment. For impaired loans which have other income streams to support repayment, a specific reserve is established for the amount determined to be impaired.

 

Impaired loans

Impaired loans totaled $44,918,658 and $53,619,534 at June 30, 2012 and December 31, 2011 respectively, and are comprised of loans on non-accrual status and loans which have been classified as troubled debt restructurings.

The categories of impaired loans at June 30, 2012 and December 31, 2011 are as follows:

 

                 
    June 30,
2012		     December 31,
2011		  

Non-accrual loans

   $ 39,529,906     $ 46,402,747  

Troubled debt restructurings continuing to accrue interest

     5,388,752       7,216,787  
   

 

 

    

 

 

  

Total impaired loans

   $ 44,918,658     $ 53,619,534  
   

 

 

    

 

 

  

The following tables provide additional information about impaired loans at June 30, 2012 and December 31, 2011, respectively, segregated between loans for which an allowance has been provided and loans for which no allowance has been provided:

 

                         
    Recorded
Investment		     Unpaid
Principal
Balance		     Related
Allowance		  
       

At June 30, 2012

                        

With no related allowance recorded:

                        

Commercial, financial and Agricultural

   $ 2,547,912     $ 2,648,404     $ —    

Real estate - construction residential

     90,794       117,000       —    

Real estate - construction commercial

     1,878,980       2,101,438       —    

Real estate - residential

     1,998,725       2,610,655       —    

Real estate - commercial

     10,122,800       14,368,535       —    

Consumer

     158,554       183,507       —    
   

 

 

    

 

 

    

 

 

  

Total

   $ 16,797,765     $ 22,029,539     $ —    
   

 

 

    

 

 

    

 

 

  

With an allowance recorded:

                        

Commercial, financial and Agricultural

   $ 3,837,699     $ 3,923,371     $ 1,595,235  

Real estate - construction residential

     189,473       192,303       59,493  

Real estate - construction commercial

     6,129,375       6,226,322       576,373  

Real estate - residential

     2,981,052       3,111,412       720,537  

Real estate - commercial

     14,983,294       15,449,609       2,141,184  
   

 

 

    

 

 

    

 

 

  

Total

   $ 28,120,893     $ 28,903,017     $ 5,092,822  
   

 

 

    

 

 

    

 

 

  

Total impaired loans

   $ 44,918,658     $ 50,932,556     $ 5,092,822  
   

 

 

    

 

 

    

 

 

  

 

                         
          Unpaid        
    Recorded
Investment		     Principal
Balance		     Related
Allowance		  

At December 31, 2011

                        

With no related allowance recorded:

                        

Commercial, financial and Agricultural

   $ 3,546,088     $ 3,625,113     $ —    

Real estate - construction residential

     584,034       788,152       —    

Real estate - construction commercial

     1,458,346       1,755,248       —    

Real estate - residential

     2,315,344       2,653,979       —    

Real estate - commercial

     15,150,920       21,189,966       —    

Consumer

     168,257       177,332       —    
   

 

 

    

 

 

    

 

 

  

Total

   $ 23,222,989     $ 30,189,790     $ —    
   

 

 

    

 

 

    

 

 

  

With an allowance recorded:

                        

Commercial, financial and Agricultural

   $ 881,585     $ 904,168     $ 238,840  

Real estate - construction residential

     562,760       562,760       166,300  

Real estate - construction commercial

     6,408,713       6,448,100       379,921  

Real estate - residential

     4,254,023       4,265,660       653,279  

Real estate - commercial

     18,289,464       18,779,725       2,309,226  
   

 

 

    

 

 

    

 

 

  

Total

   $ 30,396,545     $ 30,960,413     $ 3,747,566  
   

 

 

    

 

 

    

 

 

  

Total impaired loans

   $ 53,619,534     $ 61,150,203     $ 3,747,566  
   

 

 

    

 

 

    

 

 

  

The following table presents by class, information related to the average recorded investment and interest income recognized on impaired loans for the three and six months ended June 30, 2012 and 2011:

 

                                                                 
    For the Three Months Ended
June 30,		     For the Six Months Ended
June 30,		  
    2012     2011     2012     2011  
    Average
Recorded
Investment		     Interest
Recognized
For the
Period
Ended		     Average
Recorded
Investment		     Interest
Recognized
For the
Period
Ended		     Average
Recorded
Investment		     Interest
Recognized
For the
Period
Ended		     Average
Recorded
Investment		     Interest
Recognized
For the
Period
Ended		  

With no related allowance recorded:

                                                                

Commercial, financial and Agricultural

   $ 2,597,572     $ 21,493     $ 2,396,849     $ —       $ 2,630,049     $ 43,105     $ 2,150,452     $ 11,074  

Real estate - construction residential

     93,283       —         710,681       —         254,863       6,755       1,731,871       —    

Real estate - construction commercial

     1,571,747       —         8,256,663       —         1,505,991       —         8,251,242       —    

Real estate - residential

     2,389,527       39,892       2,801,501       7,014       3,514,860       42,225       3,429,353       11,698  

Real estate - commercial

     12,344,559       27,762       10,539,605       —         13,439,332       59,404       9,977,051       18,040  

Consumer

     146,281       15       199,852       —         153,203       326       203,899       1,349  
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Total

   $ 19,142,969     $ 89,162     $ 24,905,151     $ 7,014     $ 21,498,298     $ 151,815     $ 25,743,868     $ 42,161  
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

With an allowance recorded:

                                                                

Commercial, financial and Agricultural

   $ 3,841,845     $ 7,182     $ 1,932,068     $ 2,208     $ 3,284,473     $ 14,402     $ 1,818,910     $ 4,400  

Real estate - construction residential

     189,473       —         171,986       —         241,527       —         172,315       —    

Real estate - construction commercial

     6,146,914       —         2,362,522       —         6,186,634       —         2,067,649       —    

Real estate - residential

     2,818,306       (23,249 )      4,405,202       27,140       2,666,116       6,402       3,998,773       54,472  

Real estate - commercial

     15,033,149       —         19,065,164       1,648       14,496,174       —         17,998,970       3,289  

Total

   $ 28,029,687     $ (16,067 )    $ 27,936,942     $ 30,996     $ 26,874,924     $ 20,804     $ 26,056,617     $ 62,161  
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Total impaired loans

   $ 47,172,656     $ 73,095     $ 52,842,093     $ 38,010     $ 48,373,222     $ 172,619     $ 51,800,485     $ 104,322  
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

Interest income recognized on loans in non-accrual status and contractual interest that would have been recorded had the loans performed in accordance with their original contractual terms is as follows:

 

                                 
    Three Months Ended June 30,     Six Months Ended June 30,  
    2012     2011     2012     2011  

Contractual interest due on non-accrual loans

   $ 483,281     $ 612,472     $ 1,109,542     $ 1,218,908  

Interest income recognized on loans in non-accrual status

     (14 )      32,802       32       32,840  
   

 

 

    

 

 

    

 

 

    

 

 

  

Net reduction in interest income

   $ 483,295     $ 579,670     $ 1,109,510     $ 1,186,068  
   

 

 

    

 

 

    

 

 

    

 

 

  

The specific reserve component of our Company’s allowance for loan losses at June 30, 2012 and December 31, 2011 was determined by using fair values of the underlying collateral obtained through independent appraisals and internal evaluations, or by discounting the total expected future cash flows. The recorded investment varies from the unpaid principal balance primarily due to partial charge-offs taken resulting from current appraisals received. The amount recognized as interest income on impaired loans continuing to accrue interest, respectively, primarily related to troubled debt restructurings, was $73,095 and $38,010, for the three months ended June 30, 2012 and 2011, and $172,619 and $104,322 for the six months ended June 30, 2012 and 2011, respectively. The average recorded investment in impaired loans is calculated on a monthly basis during the periods reported.

Delinquent and Non-Accrual Loans

The delinquency status of loans is determined based on the contractual terms of the notes. Borrowers are generally classified as delinquent once payments become 30 days or more past due. The following table provides aging information for our Company’s past due and non-accrual loans at June 30, 2012 and December 31, 2011.

 

                                         
    Current or
Less Than
30 Days
Past Due		     30 - 89 Days
Past Due		     90 Days
Past Due
And Still
Accruing		     Non-Accrual     Total  
           

June 30, 2012

                                        

Commercial, Financial, and Agricultural

   $ 124,367,126     $ 461,027     $ —       $ 4,029,343     $ 128,857,496  

Real Estate Construction - Residential

     16,723,616       2,826,817       —         280,267       19,830,700  

Real Estate Construction - Commercial

     34,432,701       400,417       —         8,008,354       42,841,472  

Real Estate Mortgage - Residential

     214,108,119       1,642,415       195,673       4,387,946       220,334,153  

Real Estate Mortgage - Commercial

     380,150,636       1,652,926       —         22,665,442       404,469,004  

Installment and Other Consumer

     27,233,151       379,984       469       158,554       27,772,158  
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Total

   $ 797,015,349     $ 7,363,586     $ 196,142     $ 39,529,906     $ 844,104,983  
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  
           

December 31, 2011

                                        

Commercial, Financial, and Agricultural

   $ 126,244,521     $ 242,672     $ —       $ 2,067,980     $ 128,555,173  

Real Estate Construction - Residential

     29,054,404       —         —         1,146,794       30,201,198  

Real Estate Construction - Commercial

     39,821,946       —         7,754       7,867,059       47,696,759  

Real Estate Mortgage - Residential

     195,779,337       3,513,373       8,566       4,152,928       203,454,204  

Real Estate Mortgage - Commercial

     371,000,415       923,704       36,479       30,999,729       402,960,327  

Installment and Other Consumer

     29,281,191       612,461       978       168,257       30,062,887  
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Total

   $ 791,181,814     $ 5,292,210     $ 53,777     $ 46,402,747     $ 842,930,548  
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Credit Quality

The following table provides information about the credit quality of the loan portfolio using our Company’s internal rating system reflecting management’s risk assessment. Recent reviews by our Company’s chief credit officer identified areas of concern that resulted in heightened attention being given to reducing concentrations of credit and, in particular, to strengthening credit quality and administration. Loans are placed on watch status when (1) one or more weaknesses which could jeopardize timely liquidation exits; or (2) the margin or liquidity of an asset is sufficiently tenuous that adverse trends could result in a collection problem. Loans classified as substandard are inadequately protected by the current sound worth and paying capacity of the obligor or by the collateral pledged, if any. Loans so classified may have a well defined weakness or weaknesses that jeopardize the repayment of the debt. Such loans are characterized by the distinct possibility that our Company may sustain some loss if the deficiencies are not corrected. It is our Company's policy to discontinue the accrual of interest income on loans when management believes that the collection of interest or principal is doubtful. Loans are placed on non-accrual status when (1) deterioration in the financial condition of the borrower exists for which payment of full principal and interest is not expected, or (2) payment of principal or interest has been in default for a period of 90 days or more and the asset is not both well secured and in the process of collection. Subsequent interest payments received on such loans are applied to principal if any doubt exists as to the collectability of such principal; otherwise, such receipts are recorded as interest income on a cash basis.

 

                                                         
    Commercial     Real Estate
Construction -
Residential		     Real Estate
Construction -
Commercial		     Real Estate
Mortgage -
Residential		     Real Estate
Mortgage -
Commercial		     Installment
and other
Consumer		     Total  
               

At June 30, 2012

                                                        

Watch

   $ 13,873,941     $ 3,757,426     $ 7,569,536     $ 20,750,281     $ 26,084,889     $ 529,356     $ 72,565,429  

Substandard

     5,700,952       2,647,446       695,529       5,701,348       13,848,780       453,927       29,047,982  

Non-accrual

     4,029,343       280,267       8,008,354       4,387,946       22,665,442       158,554       39,529,906  
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Total

   $ 23,604,236     $ 6,685,139     $ 16,273,419     $ 30,839,575     $ 62,599,111     $ 1,141,837     $ 141,143,317  
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  
               

At December 31, 2011

                                                        

Watch

   $ 22,206,456     $ 9,644,326     $ 9,337,768     $ 13,231,006     $ 24,392,448     $ 557,278     $ 79,369,282  

Substandard

     4,141,582       842,063       1,189,122       4,268,914       8,003,868       444,003       18,889,552  

Non-accrual

     2,067,980       1,146,794       7,867,059       4,152,928       30,999,729       168,257       46,402,747  
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Total

   $ 28,416,018     $ 11,633,183     $ 18,393,949     $ 21,652,848     $ 63,396,045     $ 1,169,538     $ 144,661,581  
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Troubled Debt Restructurings

At June 30, 2012, loans classified as troubled debt restructurings (TDRs) totaled $28,327,786, of which $22,939,034 was on non-accrual status and $5,388,752 was on accrual status. At December 31, 2011, loans classified as TDRs totaled $32,165,238, of which $24,948,451 was on non-accrual status and $7,216,787 was on accrual status. When an individual loan is determined to be a TDR, the amount of impairment is based upon the present value of expected future cash flows discounted at the loan’s effective interest rate or the fair value of the underlying collateral less applicable selling costs. Accordingly, specific reserves of $1,582,679 and $1,522,422 were allocated to the allowance for loan losses at June 30, 2012 and December 31, 2011, respectively.

The following table summarizes loans that were modified as TDRs during the six months ended June 30, 2012:

 

                         
    The Six Months Ended June 30, 2012  
    Recorded Investment (1)  
    Number
of
Contracts		     Pre-
Modification		     Post-
Modification		  

Troubled Debt Restructurings

                        

Commercial, financial and agricultural

     1     $ 188,036     $ 196,061  

Real estate construction - commercial

     1       43,379       43,379  
   

 

 

    

 

 

    

 

 

  

Total

     2     $ 231,415     $ 239,440  
   

 

 

    

 

 

    

 

 

  

 

(1) The amounts reported post-modification are inclusive of all partial pay-downs and charge-offs, and no portion of the debt was forgiven. Loans modified as a TDR that were fully paid down, charged-off or foreclosed upon during the period ended are not reported.

 

According to guidance provided in ASC subtopic 310-40, Troubled Debt Restructurings by Creditors, a loan restructuring or modification of terms is a TDR if the creditor, for economic or legal reasons related to the borrower’s financial difficulties, grants a concession to the borrower that it would not otherwise consider. Our Company’s portfolio of loans classified as TDRs include concessions such as interest rates below the current market rate, deferring principal payments, and extending maturity dates. Once a loan becomes a TDR, it will continue to be reported as a TDR until it is ultimately repaid in full, charged-off, or the collateral for the loan is foreclosed and sold. Our Company considers a loan in TDR status in default when the borrower’s payment according to the modified terms is at least 90 days past due or has defaulted due to expiration of the loan’s maturity date. During the three months ended June 30, 2012 there were no new loans meeting the TDR criteria. During the six months ended June 30, 2012, two loans meeting the TDR criteria were modified. There were no loans modified as a TDR that defaulted during the three and six months ended June 30, 2012, and within twelve months of their modification date.