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Allowance for Loan Losses | 12 Months Ended
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Dec. 31, 2018
Receivables [Abstract] |
Allowance for Loan Losses | Allowance for Loan Losses Changes in the allowance for loan losses for the years December 31, 2018, 2017 and 2016 were as follows:
| December 31,
| 2018 |  | 2017 |  | 2016
|  |  | (in thousands) |  |
Balance, beginning | $ | 4,411 |  |  | $ | 4,505 |  |  | $ | 4,959 |
Provision for (recovery of) loan losses | 777 |  |  | (625 | ) |  | (188 | )
Recoveries added to the allowance | 504 |  |  | 901 |  |  | 341 |
Loan losses charged to the allowance | (236 | ) |  | (370 | ) |  | (607 | )
Balance, ending | $ | 5,456 |  |  | $ | 4,411 |  |  | $ | 4,505 |
Nonaccrual and past due loans by class at December 31, 2018 and December 31, 2017 were as follows:
| December 31, 2018
| (in thousands)
| 30 - 59 Days Past Due |  | 60 - 89 Days Past Due |  | 90 or More Days Past Due |  | Total Past Due |  | Current |  | Total Loans |  | 90 or More Days Past Due Still Accruing |  | Nonaccrual Loans
Commercial - Non Real Estate: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial & Industrial | $ | 127 |  |  | $ | — |  |  | $ | — |  |  | $ | 127 |  |  | $ | 32,959 |  |  | $ | 33,086 |  |  | $ | — |  |  | $ | 1,081 |
Commercial Real Estate: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Owner Occupied | — |  |  | — |  |  | — |  |  | — |  |  | 136,309 |  |  | 136,309 |  |  | — |  |  | — |
Non-owner occupied | — |  |  | — |  |  | — |  |  | — |  |  | 129,286 |  |  | 129,286 |  |  | — |  |  | 364 |
Construction and Farmland: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Residential | — |  |  | — |  |  | — |  |  | — |  |  | 6,706 |  |  | 6,706 |  |  | — |  |  | — |
Commercial | — |  |  | — |  |  | — |  |  | — |  |  | 55,220 |  |  | 55,220 |  |  | — |  |  | — |
Consumer: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Installment | 4 |  |  | — |  |  | — |  |  | 4 |  |  | 8,466 |  |  | 8,470 |  |  | — |  |  | — |
Residential: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Equity Lines | — |  |  | — |  |  | — |  |  | — |  |  | 32,815 |  |  | 32,815 |  |  | — |  |  | 92 |
Single family | 960 |  |  | 196 |  |  | 900 |  |  | 2,056 |  |  | 186,990 |  |  | 189,046 |  |  | 695 |  |  | 581 |
Multifamily | — |  |  | — |  |  | — |  |  | — |  |  | 7,923 |  |  | 7,923 |  |  | — |  |  | — |
All Other Loans | — |  |  | — |  |  | — |  |  | — |  |  | 8,454 |  |  | 8,454 |  |  | — |  |  | — |
Total | $ | 1,091 |  |  | $ | 196 |  |  | $ | 900 |  |  | $ | 2,187 |  |  | $ | 605,128 |  |  | $ | 607,315 |  |  | $ | 695 |  |  | $ | 2,118 |
| December 31, 2017
| (in thousands)
| 30 - 59 Days Past Due |  | 60 - 89 Days Past Due |  | 90 or More Days Past Due |  | Total Past Due |  | Current |  | Total Loans |  | 90 or More Past Due Still Accruing |  | Nonaccrual Loans
Commercial - Non Real Estate: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial & Industrial | $ | 75 |  |  | $ | 10 |  |  | $ | 142 |  |  | $ | 227 |  |  | $ | 37,200 |  |  | $ | 37,427 |  |  | $ | — |  |  | $ | 594 |
Commercial Real Estate: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Owner Occupied | — |  |  | — |  |  | — |  |  | — |  |  | 127,018 |  |  | 127,018 |  |  | — |  |  | — |
Non-owner occupied | — |  |  | 368 |  |  | — |  |  | 368 |  |  | 112,529 |  |  | 112,897 |  |  | — |  |  | 767 |
Construction and Farmland: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Residential | — |  |  | — |  |  | — |  |  | — |  |  | 3,214 |  |  | 3,214 |  |  | — |  |  | — |
Commercial | 187 |  |  | — |  |  | — |  |  | 187 |  |  | 48,953 |  |  | 49,140 |  |  | — |  |  | — |
Consumer: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Installment | 17 |  |  | — |  |  | 2 |  |  | 19 |  |  | 10,168 |  |  | 10,187 |  |  | — |  |  | 13 |
Residential: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Equity Lines | 18 |  |  | — |  |  | — |  |  | 18 |  |  | 32,820 |  |  | 32,838 |  |  | — |  |  | 44 |
Single family | 829 |  |  | 572 |  |  | 4,060 |  |  | 5,461 |  |  | 184,911 |  |  | 190,372 |  |  | — |  |  | 4,921 |
Multifamily | — |  |  | — |  |  | — |  |  | — |  |  | 4,095 |  |  | 4,095 |  |  | — |  |  | — |
All Other Loans | — |  |  | — |  |  | — |  |  | — |  |  | 2,050 |  |  | 2,050 |  |  | — |  |  | — |
Total | $ | 1,126 |  |  | $ | 950 |  |  | $ | 4,204 |  |  | $ | 6,280 |  |  | $ | 562,958 |  |  | $ | 569,238 |  |  | $ | — |  |  | $ | 6,339 |
Allowance for loan losses by segment at December 31, 2018, December 31, 2017 and December 31, 2016 were as follows:
| As of and for the Twelve Months Ended
| December 31, 2018
| (in thousands)
| Construction and Farmland |  | Residential Real Estate |  | Commercial Real Estate |  | Commercial |  | Consumer |  | All Other Loans |  | Unallocated |  | Total
Allowance for credit losses: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Beginning Balance | $ | 332 |  |  | $ | 1,754 |  |  | $ | 1,627 |  |  | $ | 570 |  |  | $ | 69 |  |  | $ | 29 |  |  | $ | 30 |  |  | $ | 4,411 |
Charge-Offs | — |  |  | (24 | ) |  | — |  |  | (139 | ) |  | (33 | ) |  | (40 | ) |  | — |  |  | (236 | )
Recoveries | 266 |  |  | 28 |  |  | 78 |  |  | 100 |  |  | 19 |  |  | 13 |  |  | — |  |  | 504 |
Provision (recovery) | (15 | ) |  | 30 |  |  | 283 |  |  | 388 |  |  | (2 | ) |  | 95 |  |  | (2 | ) |  | 777 |
Ending balance | $ | 583 |  |  | $ | 1,788 |  |  | $ | 1,988 |  |  | $ | 919 |  |  | $ | 53 |  |  | $ | 97 |  |  | $ | 28 |  |  | $ | 5,456 |
Ending balance: Individually evaluated for impairment | $ | — |  |  | $ | 119 |  |  | $ | 193 |  |  | $ | 650 |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 962 |
Ending balance: collectively evaluated for impairment | $ | 583 |  |  | $ | 1,669 |  |  | $ | 1,795 |  |  | $ | 269 |  |  | $ | 53 |  |  | $ | 97 |  |  | $ | 28 |  |  | $ | 4,494 |
Loans: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Ending balance | $ | 61,926 |  |  | $ | 229,784 |  |  | $ | 265,595 |  |  | $ | 33,086 |  |  | $ | 8,470 |  |  | $ | 8,454 |  |  | $ | — |  |  | $ | 607,315 |
Ending balance individually evaluated for impairment | $ | 280 |  |  | $ | 4,044 |  |  | $ | 2,919 |  |  | $ | 1,316 |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 8,559 |
Ending balance collectively evaluated for impairment | $ | 61,646 |  |  | $ | 225,740 |  |  | $ | 262,676 |  |  | $ | 31,770 |  |  | $ | 8,470 |  |  | $ | 8,454 |  |  | $ | — |  |  | $ | 598,756 |
| As of and for the Twelve Months Ended
| December 31, 2017
| (in thousands)
| Construction and Farmland |  | Residential Real Estate |  | Commercial Real Estate |  | Commercial |  | Consumer |  | All Other Loans |  | Unallocated |  | Total
Allowance for credit losses: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Beginning Balance | $ | 450 |  |  | $ | 1,992 |  |  | $ | 1,522 |  |  | $ | 235 |  |  | $ | 69 |  |  | $ | 22 |  |  | $ | 215 |  |  | $ | 4,505 |
Charge-Offs | (19 | ) |  | (55 | ) |  | (1 | ) |  | (187 | ) |  | (59 | ) |  | (49 | ) |  | — |  |  | (370 | )
Recoveries | 535 |  |  | 212 |  |  | 65 |  |  | 44 |  |  | 40 |  |  | 5 |  |  | — |  |  | 901 |
Provision (recovery) | (634 | ) |  | (395 | ) |  | 41 |  |  | 478 |  |  | 19 |  |  | 51 |  |  | (185 | ) |  | (625 | )
Ending balance | $ | 332 |  |  | $ | 1,754 |  |  | $ | 1,627 |  |  | $ | 570 |  |  | $ | 69 |  |  | $ | 29 |  |  | $ | 30 |  |  | $ | 4,411 |
Ending balance: Individually evaluated for impairment | $ | — |  |  | $ | 195 |  |  | $ | 59 |  |  | $ | 195 |  |  | $ | 9 |  |  | $ | — |  |  | $ | — |  |  | $ | 458 |
Ending balance: collectively evaluated for impairment | $ | 332 |  |  | $ | 1,559 |  |  | $ | 1,568 |  |  | $ | 375 |  |  | $ | 60 |  |  | $ | 29 |  |  | $ | 30 |  |  | $ | 3,953 |
Loans: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Ending balance | $ | 52,354 |  |  | $ | 227,305 |  |  | $ | 239,915 |  |  | $ | 37,427 |  |  | $ | 10,187 |  |  | $ | 2,050 |  |  | $ | — |  |  | $ | 569,238 |
Ending balance individually evaluated for impairment | $ | 315 |  |  | $ | 8,315 |  |  | $ | 1,904 |  |  | $ | 858 |  |  | $ | 34 |  |  | $ | — |  |  | $ | — |  |  | $ | 11,426 |
Ending balance collectively evaluated for impairment | $ | 52,039 |  |  | $ | 218,990 |  |  | $ | 238,011 |  |  | $ | 36,569 |  |  | $ | 10,153 |  |  | $ | 2,050 |  |  | $ | — |  |  | $ | 557,812 |
| As of and for the Twelve Months Ended
| December 31, 2016
| (in thousands)
| Construction and Farmland |  | Residential Real Estate |  | Commercial Real Estate |  | Commercial |  | Consumer |  | All Other Loans |  | Unallocated |  | Total
Allowance for credit losses: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Beginning Balance | $ | 775 |  |  | $ | 2,322 |  |  | $ | 1,268 |  |  | $ | 211 |  |  | $ | 109 |  |  | $ | 53 |  |  | $ | 221 |  |  | $ | 4,959 |
Charge-Offs | — |  |  | (535 | ) |  | — |  |  | — |  |  | (30 | ) |  | (42 | ) |  | — |  |  | (607 | )
Recoveries | 144 |  |  | 124 |  |  | 8 |  |  | 11 |  |  | 49 |  |  | 5 |  |  | — |  |  | 341 |
Provision (recovery) | (469 | ) |  | 81 |  |  | 246 |  |  | 13 |  |  | (59 | ) |  | 6 |  |  | (6 | ) |  | (188 | )
Ending balance | $ | 450 |  |  | $ | 1,992 |  |  | $ | 1,522 |  |  | $ | 235 |  |  | $ | 69 |  |  | $ | 22 |  |  | $ | 215 |  |  | $ | 4,505 |
Ending balance: Individually evaluated for impairment | $ | — |  |  | $ | 268 |  |  | $ | 102 |  |  | $ | 15 |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 385 |
Ending balance: collectively evaluated for impairment | $ | 450 |  |  | $ | 1,724 |  |  | $ | 1,420 |  |  | $ | 220 |  |  | $ | 69 |  |  | $ | 22 |  |  | $ | 215 |  |  | $ | 4,120 |
Loans: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Ending balance | $ | 31,791 |  |  | $ | 231,532 |  |  | $ | 208,525 |  |  | $ | 30,341 |  |  | $ | 12,677 |  |  | $ | 2,259 |  |  | $ | — |  |  | $ | 517,125 |
Ending balance individually evaluated for impairment | $ | 1,320 |  |  | $ | 8,608 |  |  | $ | 2,864 |  |  | $ | 581 |  |  | $ | 7 |  |  | $ | — |  |  | $ | — |  |  | $ | 13,380 |
Ending balance collectively evaluated for impairment | $ | 30,471 |  |  | $ | 222,924 |  |  | $ | 205,661 |  |  | $ | 29,760 |  |  | $ | 12,670 |  |  | $ | 2,259 |  |  | $ | — |  |  | $ | 503,745 |
Beginning with the quarter ended September 30, 2018, the Company changed its allowance methodology for the look-back period used in calculating the loss history portion of the general reserves assigned to unimpaired credits. During this quarter, management determined it necessary to extend the loss history period utilized in the calculation from five years to seven years in light of current trends for growth and asset quality, as well as the ongoing economic cycle and the Bank's overall lending environment. The Company believes that the expanded loss history is more indicative of the losses and risks inherent in the portfolio. The following table represents the effect on the loan loss provision for the twelve months ended December 31, 2018 as a result of the change in allowance methodology from that used in prior periods.
(in thousands) |  | Calculated Provision Based on Current Methodology |  | Calculated Provision Based on Prior Methodology |  | Difference
Portfolio Segment: |  |  |  |  |  |
Construction and Farmland |  | $ | (15 | ) |  | $ | (197 | ) |  | $ | 182 |
Residential Real Estate |  | 30 |  |  | (161 | ) |  | 191 |
Commercial Real Estate |  | 283 |  |  | 140 |  |  | 143 |
Commercial |  | 388 |  |  | 326 |  |  | 62 |
Consumer |  | (2 | ) |  | (7 | ) |  | 5 |
All Other Loans |  | 95 |  |  | 102 |  |  | (7 | )
Total, excluding unallocated |  | $ | 779 |  |  | $ | 203 |  |  | $ | 576 |
Impaired loans by class at December 31, 2018 and December 31, 2017 were as follows:
| As of and for the Year Ended
| December 31, 2018
| (in thousands)
| Unpaid Principal Balance |  | Recorded Investment (1) |  | Related Allowance |  | Average Recorded Investment |  | Interest Income Recognized
With no related allowance: |  |  |  |  |  |  |  |  |
Commercial - Non Real Estate: |  |  |  |  |  |  |  |  |
Commercial & Industrial | $ | 564 |  |  | $ | 356 |  |  | $ | — |  |  | $ | 422 |  |  | $ | 25 |
Commercial Real Estate: |  |  |  |  |  |  |  |  |
Owner Occupied | — |  |  | — |  |  | — |  |  | — |  |  | — |
Non-owner occupied | 558 |  |  | 501 |  |  | — |  |  | 511 |  |  | 4 |
Construction and Farmland: |  |  |  |  |  |  |  |  |
Residential | — |  |  | — |  |  | — |  |  | — |  |  | — |
Commercial | 332 |  |  | 281 |  |  | — |  |  | 297 |  |  | 27 |
Consumer: |  |  |  |  |  |  |  |  |
Installment | — |  |  | — |  |  | — |  |  | — |  |  | — |
Residential: |  |  |  |  |  |  |  |  |
Equity lines | 468 |  |  | 92 |  |  | — |  |  | 93 |  |  | — |
Single family | 2,616 |  |  | 2,499 |  |  | — |  |  | 2,565 |  |  | 101 |
Multifamily | 284 |  |  | 286 |  |  | — |  |  | 289 |  |  | 14 |
Other Loans | — |  |  | — |  |  | — |  |  | — |  |  | — |
| $ | 4,822 |  |  | $ | 4,015 |  |  | $ | — |  |  | $ | 4,177 |  |  | $ | 171 |
With an allowance recorded: |  |  |  |  |  |  |  |  |
Commercial - Non Real Estate: |  |  |  |  |  |  |  |  |
Commercial & Industrial | $ | 971 |  |  | $ | 960 |  |  | $ | 650 |  |  | $ | 1,063 |  |  | $ | 60 |
Commercial Real Estate: |  |  |  |  |  |  |  |  |
Owner Occupied | — |  |  | — |  |  | — |  |  | — |  |  | — |
Non-owner occupied | 2,418 |  |  | 2,425 |  |  | 193 |  |  | 2,454 |  |  | 101 |
Construction and Farmland: |  |  |  |  |  |  |  |  |
Residential | — |  |  | — |  |  | — |  |  | — |  |  | — |
Commercial | — |  |  | — |  |  | — |  |  | — |  |  | — |
Consumer: |  |  |  |  |  |  |  |  |
Installment | — |  |  | — |  |  | — |  |  | — |  |  | — |
Residential: |  |  |  |  |  |  |  |  |
Equity lines | — |  |  | — |  |  | — |  |  | — |  |  | — |
Single family | 1,242 |  |  | 1,190 |  |  | 119 |  |  | 1,204 |  |  | 51 |
Multifamily | — |  |  | — |  |  | — |  |  | — |  |  | — |
Other Loans | — |  |  | — |  |  | — |  |  | — |  |  | — |
| $ | 4,631 |  |  | $ | 4,575 |  |  | $ | 962 |  |  | $ | 4,721 |  |  | $ | 212 |
Total: |  |  |  |  |  |  |  |  |
Commercial | $ | 1,535 |  |  | $ | 1,316 |  |  | $ | 650 |  |  | $ | 1,485 |  |  | $ | 85 |
Commercial Real Estate | 2,976 |  |  | 2,926 |  |  | 193 |  |  | 2,965 |  |  | 105 |
Construction and Farmland | 332 |  |  | 281 |  |  | — |  |  | 297 |  |  | 27 |
Consumer | — |  |  | — |  |  | — |  |  | — |  |  | — |
Residential | 4,610 |  |  | 4,067 |  |  | 119 |  |  | 4,151 |  |  | 166 |
Other | — |  |  | — |  |  | — |  |  | — |  |  | — |
Total | $ | 9,453 |  |  | $ | 8,590 |  |  | $ | 962 |  |  | $ | 8,898 |  |  | $ | 383 |
(1) Recorded investment is defined as the summation of the outstanding principal balance, accrued interest, and any partial charge-offs.
| As of and for the Year Ended
| December 31, 2017
| (in thousands)
| Unpaid Principal Balance |  | Recorded Investment (1) |  | Related Allowance |  | Average Recorded Investment |  | Interest Income Recognized
With no related allowance: |  |  |  |  |  |  |  |  |
Commercial - Non Real Estate: |  |  |  |  |  |  |  |  |
Commercial & Industrial | $ | 626 |  |  | $ | 304 |  |  | $ | — |  |  | $ | 342 |  |  | $ | 23 |
Commercial Real Estate: |  |  |  |  |  |  |  |  |
Owner Occupied | 330 |  |  | 331 |  |  | — |  |  | 336 |  |  | 15 |
Non-owner occupied | 805 |  |  | 767 |  |  | — |  |  | 785 |  |  | 20 |
Construction and Farmland: |  |  |  |  |  |  |  |  |
Residential | — |  |  | — |  |  | — |  |  | — |  |  | — |
Commercial | 362 |  |  | 316 |  |  | — |  |  | 330 |  |  | 28 |
Consumer: |  |  |  |  |  |  |  |  |
Installment | 25 |  |  | 25 |  |  | — |  |  | 27 |  |  | 1 |
Residential: |  |  |  |  |  |  |  |  |
Equity lines | — |  |  | — |  |  | — |  |  | — |  |  | — |
Single family | 7,371 |  |  | 6,985 |  |  | — |  |  | 7,069 |  |  | 124 |
Multifamily | — |  |  | — |  |  | — |  |  | — |  |  | — |
Other Loans | — |  |  | — |  |  | — |  |  | — |  |  | — |
| $ | 9,519 |  |  | $ | 8,728 |  |  | $ | — |  |  | $ | 8,889 |  |  | $ | 211 |
With an allowance recorded: |  |  |  |  |  |  |  |  |
Commercial - Non Real Estate: |  |  |  |  |  |  |  |  |
Commercial & Industrial | $ | 595 |  |  | $ | 556 |  |  | $ | 195 |  |  | $ | 567 |  |  | $ | 17 |
Commercial Real Estate: |  |  |  |  |  |  |  |  |
Owner Occupied | — |  |  | — |  |  | — |  |  | — |  |  | — |
Non-owner occupied | 806 |  |  | 809 |  |  | 59 |  |  | 817 |  |  | 37 |
Construction and Farmland: |  |  |  |  |  |  |  |  |
Residential | — |  |  | — |  |  | — |  |  | — |  |  | — |
Commercial | — |  |  | — |  |  | — |  |  | — |  |  | — |
Consumer: |  |  |  |  |  |  |  |  |
Installment | 9 |  |  | 9 |  |  | 9 |  |  | 9 |  |  | — |
Residential: |  |  |  |  |  |  |  |  |
Equity lines | 217 |  |  | 44 |  |  | 44 |  |  | 45 |  |  | — |
Single family | 1,349 |  |  | 1,299 |  |  | 151 |  |  | 1,315 |  |  | 57 |
Multifamily | — |  |  | — |  |  | — |  |  | — |  |  | — |
Other Loans | — |  |  | — |  |  | — |  |  | — |  |  | — |
| $ | 2,976 |  |  | $ | 2,717 |  |  | $ | 458 |  |  | $ | 2,753 |  |  | $ | 111 |
Total: |  |  |  |  |  |  |  |  |
Commercial | $ | 1,221 |  |  | $ | 860 |  |  | $ | 195 |  |  | $ | 909 |  |  | $ | 40 |
Commercial Real Estate | 1,941 |  |  | 1,907 |  |  | 59 |  |  | 1,938 |  |  | 72 |
Construction and Farmland | 362 |  |  | 316 |  |  | — |  |  | 330 |  |  | 28 |
Consumer | 34 |  |  | 34 |  |  | 9 |  |  | 36 |  |  | 1 |
Residential | 8,937 |  |  | 8,328 |  |  | 195 |  |  | 8,429 |  |  | 181 |
Other | — |  |  | — |  |  | — |  |  | — |  |  | — |
Total | $ | 12,495 |  |  | $ | 11,445 |  |  | $ | 458 |  |  | $ | 11,642 |  |  | $ | 322 |
(1) Recorded investment is defined as the summation of the outstanding principal balance, accrued interest, and any partial charge-offs. For the year ended December 31, 2016, the average recorded investment of impaired loans was $13.7 million. The interest income recognized on impaired loans was $415 thousand in 2016. When the ultimate collectability of the total principal of an impaired loan is in doubt and the loan is in nonaccrual status, all payments are applied to principal under the cost-recovery method. For financial statement purposes, the recorded investment in nonaccrual loans is the actual principal balance reduced by payments that would otherwise have been applied to interest. When reporting information on these loans to the applicable customers, the unpaid principal balance is reported as if payments were applied to principal and interest under the original terms of the loan agreements. Therefore, the unpaid principal balance reported to the customer would be higher than the recorded investment in the loan for financial statement purposes. When the ultimate collectability of the total principal of the impaired loan is not in doubt and the loan is in nonaccrual status, contractual interest is credited to interest income when received under the cash-basis method. The Company uses a rating system for evaluating the risks associated with non-consumer loans. Consumer loans are not evaluated for risk unless the characteristics of the loan fall within classified categories. Descriptions of these ratings are as follows:
Pass |  | Pass loans exhibit acceptable history of profits, cash flow ability and liquidity. Sufficient cash flow exists to service the loan. All obligations have been paid by the borrower in an as agreed manner.
Pass Monitored |  | Pass monitored loans may be experiencing income and cash volatility, inconsistent operating trends, nominal liquidity and/or a leveraged balance sheet. A higher level of supervision is required for these loans as the potential for a negative event could impact the borrower’s ability to repay the loan.
Special mention |  | Special mention loans exhibit negative trends and potential weakness that, if left uncorrected, may negatively affect the borrower’s ability to repay its obligations. The risk of default is not imminent and the borrower still demonstrates sufficient financial strength to service debt.
Substandard |  | Substandard loans exhibit well defined weaknesses resulting in a higher probability of default. The borrowers exhibit adverse financial trends and a diminishing ability or willingness to service debt.
Doubtful |  | Doubtful loans exhibit all of the characteristics inherent in substandard loans; however given the severity of weaknesses, the collection of 100% of the principal is unlikely under current conditions.
Loss |  | Loss loans are considered uncollectible over a reasonable period of time and of such little value that its continuance as a bankable asset is not warranted.
Credit quality information by class at December 31, 2018 and December 31, 2017 was as follows:
| As of
| December 31, 2018
| (in thousands)
INTERNAL RISK RATING GRADES | Pass |  | Pass Monitored |  | Special Mention |  | Substandard |  | Doubtful |  | Loss |  | Total
Commercial - Non Real Estate: |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial & Industrial | $ | 28,699 |  |  | $ | 2,292 |  |  | $ | 995 |  |  | $ | 1,100 |  |  | $ | — |  |  | $ | — |  |  | $ | 33,086 |
Commercial Real Estate: |  |  |  |  |  |  |  |  |  |  |  |  |
Owner Occupied | 110,418 |  |  | 16,665 |  |  | 9,187 |  |  | 39 |  |  | — |  |  | — |  |  | 136,309 |
Non-owner occupied | 106,658 |  |  | 17,139 |  |  | 3,397 |  |  | 2,092 |  |  | — |  |  | — |  |  | 129,286 |
Construction and Farmland: |  |  |  |  |  |  |  |  |  |  |  |  |
Residential | 2,295 |  |  | 1,120 |  |  | 3,291 |  |  | — |  |  | — |  |  | — |  |  | 6,706 |
Commercial | 16,682 |  |  | 22,533 |  |  | 15,658 |  |  | 347 |  |  | — |  |  | — |  |  | 55,220 |
Residential: |  |  |  |  |  |  |  |  |  |  |  |  |
Equity Lines | 31,813 |  |  | 910 |  |  | — |  |  | 16 |  |  | 76 |  |  | — |  |  | 32,815 |
Single family | 172,360 |  |  | 11,567 |  |  | 2,704 |  |  | 2,270 |  |  | 145 |  |  | — |  |  | 189,046 |
Multifamily | 7,160 |  |  | 479 |  |  | — |  |  | 284 |  |  | — |  |  | — |  |  | 7,923 |
All other loans | 8,435 |  |  | 19 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 8,454 |
Total | $ | 484,520 |  |  | $ | 72,724 |  |  | $ | 35,232 |  |  | $ | 6,148 |  |  | $ | 221 |  |  | $ | — |  |  | $ | 598,845 |
| Performing |  | Nonperforming
Consumer Credit Exposure by Payment Activity | $ | 8,466 |  |  | $ | 4 |
| As of
| December 31, 2017
| (in thousands)
INTERNAL RISK RATING GRADES | Pass |  | Pass Monitored |  | Special Mention |  | Substandard |  | Doubtful |  | Loss |  | Total
Commercial - Non Real Estate: |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial & Industrial | $ | 33,279 |  |  | $ | 1,788 |  |  | $ | 1,748 |  |  | $ | 612 |  |  | $ | — |  |  | $ | — |  |  | $ | 37,427 |
Commercial Real Estate: |  |  |  |  |  |  |  |  |  |  |  |  |
Owner Occupied | 112,649 |  |  | 10,893 |  |  | 3,146 |  |  | 330 |  |  | — |  |  | — |  |  | 127,018 |
Non-owner occupied | 82,050 |  |  | 17,992 |  |  | 12,088 |  |  | 767 |  |  | — |  |  | — |  |  | 112,897 |
Construction and Farmland: |  |  |  |  |  |  |  |  |  |  |  |  |
Residential | 2,614 |  |  | 600 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 3,214 |
Commercial | 30,093 |  |  | 17,069 |  |  | 1,663 |  |  | 315 |  |  | — |  |  | — |  |  | 49,140 |
Residential: |  |  |  |  |  |  |  |  |  |  |  |  |
Equity Lines | 32,495 |  |  | 299 |  |  | — |  |  | — |  |  | 44 |  |  | — |  |  | 32,838 |
Single family | 177,829 |  |  | 5,869 |  |  | 155 |  |  | 6,327 |  |  | 192 |  |  | — |  |  | 190,372 |
Multifamily | 3,588 |  |  | — |  |  | 507 |  |  | — |  |  | — |  |  | — |  |  | 4,095 |
All other loans | 2,050 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 2,050 |
Total | $ | 476,647 |  |  | $ | 54,510 |  |  | $ | 19,307 |  |  | $ | 8,351 |  |  | $ | 236 |  |  | $ | — |  |  | $ | 559,051 |
| Performing |  | Nonperforming
Consumer Credit Exposure by Payment Activity | $ | 10,168 |  |  | $ | 19 |
Zero consumer loans were rated below Pass at December 31, 2018. Three consumer loan totaling $13 thousand was rated below Pass at December 31, 2017.

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