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Note 4 - Allowance for Loan Losses
 9 Months Ended
Sep. 30, 2019
Notes to Financial Statements  
Allowance for Credit Losses [Text Block]
Note
4.
Allowance for Loan Losses
 
The following tables present, as of
September 30, 2019
,
December 31, 2018
and
September 30, 2018
, the total allowance for loan losses, the allowance by impairment methodology, and loans by impairment methodology (in thousands):
 
   
September 30, 2019
  
   
Construction and Land Development
    
Secured by 1-4 Family Residential
    
Other Real Estate
    
Commercial and Industrial
    
Consumer and Other Loans
    
Total
  
Allowance for loan losses:
      
 
      
 
      
 
      
 
      
 
      
 
Beginning Balance, December 31, 2018   $
561
     $
895
     $
2,160
     $
464
     $
929
     $
5,009
  
Charge-offs    
—
      
(58
 )    
—
      
(2
 )    
(543
 )    
(603
 )
Recoveries    
50
      
8
      
—
      
6
      
242
      
306
  
Provision for (recovery of) loan losses    
(119
 )    
(71
 )    
166
      
98
      
126
      
200
  
Ending Balance, September 30, 2019
   $
492
     $
774
     $
2,326
     $
566
     $
754
     $
4,912
  
Ending Balance:
                                                
Individually evaluated for impairment    
31
      
16
      
27
      
—
      
—
      
74
  
Collectively evaluated for impairment    
461
      
758
      
2,299
      
566
      
754
      
4,838
  
Loans:
      
 
      
 
      
 
      
 
      
 
      
 
Ending Balance
   $
45,193
     $
226,828
     $
233,067
     $
50,557
     $
15,608
     $
571,253
  
Individually evaluated for impairment    
376
      
690
      
500
      
—
      
—
      
1,566
  
Collectively evaluated for impairment    
44,817
      
226,138
      
232,567
      
50,557
      
15,608
      
569,687
  
 
   
December 31, 2018
  
   
Construction and Land Development
    
Secured by 1-4 Family Residential
    
Other Real Estate
    
Commercial and Industrial
    
Consumer and Other Loans
    
Total
  
Allowance for loan losses:
      
 
      
 
      
 
      
 
      
 
      
 
Beginning Balance, At December 31, 2017
   $
414
     $
775
     $
2,948
     $
418
     $
771
     $
5,326
  
Charge-offs
    
—
      
(55
 )    
—
      
(10
 )    
(1,104
 )    
(1,169
 )
Recoveries
    
—
      
13
      
5
      
8
      
226
      
252
  
Provision for (recovery of) loan losses
    
147
      
162
      
(793
 )    
48
      
1,036
      
600
  
Ending Balance, December 31, 2018
   $
561
     $
895
     $
2,160
     $
464
     $
929
     $
5,009
  
Ending Balance:
                                                
Individually evaluated for impairment
    
71
      
172
      
—
      
—
      
—
      
243
  
Collectively evaluated for impairment
    
490
      
723
      
2,160
      
464
      
929
      
4,766
  
Loans:
      
 
      
 
      
 
      
 
      
 
      
 
Ending Balance
   $
45,867
     $
215,945
     $
219,553
     $
44,605
     $
16,886
     $
542,856
  
Individually evaluated for impairment
    
327
      
663
      
2,249
      
197
      
—
      
3,436
  
Collectively evaluated for impairment
    
45,540
      
215,282
      
217,304
      
44,408
      
16,886
      
539,420
  
 
   
September 30, 2018
  
   
Construction and Land Development
    
Secured by 1-4 Family Residential
    
Other Real Estate
    
Commercial and Industrial
    
Consumer and Other Loans
    
Total
  
Allowance for loan losses:
      
 
      
 
      
 
      
 
      
 
      
 
Beginning Balance, At December 31, 2017
   $
414
     $
775
     $
2,948
     $
418
     $
771
     $
5,326
  
Charge-offs
    
—
      
(56
 )    
—
      
(8
 )    
(731
 )    
(795
 )
Recoveries
    
—
      
11
      
1
      
6
      
152
      
170
  
Provision for (recovery of) loan losses
    
128
      
(5
 )    
(677
 )    
26
      
628
      
100
  
Ending Balance, September 30, 2018
   $
542
     $
725
     $
2,272
     $
442
     $
820
     $
4,801
  
Ending Balance:
                                                
Individually evaluated for impairment
    
87
      
20
      
—
      
—
      
—
      
107
  
Collectively evaluated for impairment
    
455
      
705
      
2,272
      
442
      
820
      
4,694
  
Loans:
      
 
      
 
      
 
      
 
      
 
      
 
Ending Balance
   $
42,982
     $
211,938
     $
224,903
     $
42,861
     $
17,137
     $
539,821
  
Individually evaluated for impairment
    
343
      
438
      
2,029
      
197
      
—
      
3,007
  
Collectively evaluated for impairment
    
42,639
      
211,500
      
222,874
      
42,664
      
17,137
      
536,814
  
 
Impaired loans and the related allowance at
September 30, 2019
,
December 31, 2018
and
September 30, 2018
, were as follows (in thousands):
 
   
September 30, 2019
  
   
Unpaid Principal Balance
    
Recorded Investment with No Allowance
    
Recorded Investment with Allowance
    
Total Recorded Investment
    
Related Allowance
    
Average Recorded Investment
    
Interest Income Recognized
  
Real estate loans:
                                                        
Construction and land development   $
403
     $
—
     $
376
     $
376
     $
31
     $
368
     $
1
  
Secured by 1-4 family    
781
      
543
      
147
      
690
      
16
      
800
      
1
  
Other real estate loans    
515
      
473
      
27
      
500
      
27
      
858
      
3
  
Commercial and industrial    
—
      
—
      
—
      
—
      
—
      
30
      
—
  
Total
   $
1,699
     $
1,016
     $
550
     $
1,566
     $
74
     $
2,056
     $
5
  
 
   
December 31, 2018
  
   
Unpaid Principal Balance
    
Recorded Investment with No Allowance
    
Recorded Investment with Allowance
    
Total Recorded Investment
    
Related Allowance
    
Average Recorded Investment
    
Interest Income Recognized
  
Real estate loans:
                                                        
Construction and land development
   $
336
     $
—
     $
327
     $
327
     $
71
     $
758
     $
12
  
Secured by 1-4 family
    
720
      
356
      
307
      
663
      
172
      
966
      
22
  
Other real estate loans
    
2,290
      
2,249
      
—
      
2,249
      
—
      
1,585
      
51
  
Commercial and industrial
    
200
      
197
      
—
      
197
      
—
      
146
      
—
  
Total
   $
3,546
     $
2,802
     $
634
     $
3,436
     $
243
     $
3,455
     $
85
  
 
   
September 30, 2018
  
   
Unpaid Principal Balance
    
Recorded Investment with No Allowance
    
Recorded Investment with Allowance
    
Total Recorded Investment
    
Related Allowance
    
Average Recorded Investment
    
Interest Income Recognized
  
Real estate loans:
                                                        
Construction and land development
   $
343
     $
—
     $
343
     $
343
     $
87
     $
900
     $
12
  
Secured by 1-4 family
    
511
      
287
      
151
      
438
      
20
      
1,172
      
5
  
Other real estate loans
    
2,069
      
2,029
      
—
      
2,029
      
—
      
1,433
      
37
  
Commercial and industrial
    
200
      
197
      
—
      
197
      
—
      
129
      
—
  
Total
   $
3,123
     $
2,513
     $
494
     $
3,007
     $
107
     $
3,634
     $
54
  
 
The “Recorded Investment” amounts in the table above represent the outstanding principal balance on each loan represented in the table. The “Unpaid Principal Balance” represents the outstanding principal balance on each loan represented in the table plus any amounts that have been charged off on each loan and/or payments that have been applied towards principal on non-accrual loans. Only loan classes with balances are included in the tables above.
 
As of
September 30, 2019
, loans classified as troubled debt restructurings (TDRs) and included in impaired loans in the disclosure above totaled
$371
thousand. At
September 30, 2019
, 
none
of the loans classified as TDRs were performing under the restructured terms and all were considered non-performing assets. There were
$467
thousand in TDRs at
December 31, 2018
,
$264
thousand of which were performing under the restructured terms. Modified terms under TDRs
may
include rate reductions, extension of terms that are considered to be below market, conversion to interest only, and other actions intended to minimize the economic loss and to avoid foreclosure or repossession of the collateral. There were
no
loans modified under TDRs during the
three
months ended 
September 30, 2019.
There was
one
loan secured by
1
-
4
family residential real estate modified as a TDR during the 
nine
months ended 
September 30, 2019
because the loan was extended with terms considered to be below market. The TDR described above did
not
have an impact on the allowance for loan losses at
September 30, 2019
. There was
one
 
loan secured by
1
-
4
family residential real estate modified as a TDR during the
three
and
nine
months ended
September 30, 2018
 because the loan was renewed with an interest rate considered to be below the market rate. The loan modified as a TDR during
2018
increased the allowance for loan losses by
$19
thousand at
September 30, 2018.
 
For the
three
and
nine
months ended
September 30, 2019
and
2018
, there were
no
TDRs that subsequently defaulted within
twelve
months of the loan modification. Management defines default as over
ninety
days past due or the foreclosure and repossession of the collateral or charge-off of the loan during the
twelve
month period subsequent to the modification.