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Note 8 - Loans Receivable and Credit Disclosures | 9 Months Ended
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Sep. 30, 2020
Notes to Financial Statements |
Financing Receivables [Text Block] |
8. | Loans Receivable and Credit Disclosures
The composition of loans receivable as of September 30, 2020 and December 31, 2019 is as follows (in thousands):
|  | 2020 |  |  | 2019 |
Real estate - construction |  | $ | 45,521 |  |  | $ | 47,895 |
Real estate - 1 to 4 family residential |  |  | 211,239 |  |  |  | 201,510 |
Real estate - commercial |  |  | 491,399 |  |  |  | 435,850 |
Real estate - agricultural |  |  | 157,495 |  |  |  | 160,771 |
Commercial 1 |  |  | 152,707 |  |  |  | 84,084 |
Agricultural |  |  | 102,199 |  |  |  | 111,945 |
Consumer and other |  |  | 16,539 |  |  |  | 18,791 |
|  |  | 1,177,099 |  |  |  | 1,060,846 |
Less: |  |  |  |  |  |  |  |
Allowance for loan losses |  |  | (15,932 | ) |  |  | (12,619 | )
Deferred loan fees 2 |  |  | (2,104 | ) |  |  | (80 | )
Loans receivable, net |  | $ | 1,159,063 |  |  | $ | 1,048,147 |
1 Commercial loan portfolio as of September 30, 2020 includes $79.6 million Payroll Protection Program ("PPP") loans 2 Deferred loan fees as of September 30, 2020 includes $1.9 million of fees related to the PPP loans. The Paycheck Protection Program (PPP) was established by the Coronavirus Aid, Relief and Economic Security Act (CARES Act), enacted on March 27, 2020, in response to the Coronavirus Disease 2019 (COVID-19) pandemic. The PPP is administered by the Small Business Administration (SBA). PPP loans may be forgiven by the SBA and are 100 percent guaranteed by the SBA. Activity in the allowance for loan losses, on a disaggregated basis, for the three and nine months ended September 30, 2020 and 2019 is as follows (in thousands):
|  | Three Months Ended September 30, 2020 |
|  |  |  |  |  | 1-4 Family |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | Construction |  |  | Residential |  |  | Commercial |  |  | Agricultural |  |  |  |  |  |  |  |  |  |  | Consumer |  |  |  |  |
|  | Real Estate |  |  | Real Estate |  |  | Real Estate |  |  | Real Estate |  |  | Commercial |  |  | Agricultural |  |  | and Other |  |  | Total |
Balance, June 30, 2020 |  | $ | 849 |  |  | $ | 2,505 |  |  | $ | 6,864 |  |  | $ | 1,713 |  |  | $ | 1,994 |  |  | $ | 1,830 |  |  | $ | 250 |  |  | $ | 16,005 |
Provision (credit) for loan losses |  |  | (105 | ) |  |  | 80 |  |  |  | 583 |  |  |  | (15 | ) |  |  | (5 | ) |  |  | (14 | ) |  |  | 18 |  |  |  | 542 |
Recoveries of loans charged-off |  |  | - |  |  |  | 2 |  |  |  | 1 |  |  |  | - |  |  |  | 9 |  |  |  | - |  |  |  | 272 |  |  |  | 284 |
Loans charged-off |  |  | - |  |  |  | (1 | ) |  |  | - |  |  |  | - |  |  |  | (582 | ) |  |  | (48 | ) |  |  | (268 | ) |  |  | (899 | )
Balance, September 30, 2020 |  | $ | 744 |  |  | $ | 2,586 |  |  | $ | 7,448 |  |  | $ | 1,698 |  |  | $ | 1,416 |  |  | $ | 1,768 |  |  | $ | 272 |  |  | $ | 15,932 |
|  | Nine Months Ended September 30, 2020 |
|  |  |  |  |  | 1-4 Family |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | Construction |  |  | Residential |  |  | Commercial |  |  | Agricultural |  |  |  |  |  |  |  |  |  |  | Consumer |  |  |  |  |
|  | Real Estate |  |  | Real Estate |  |  | Real Estate |  |  | Real Estate |  |  | Commercial |  |  | Agricultural |  |  | and Other |  |  | Total |
Balance, December 31, 2019 |  | $ | 672 |  |  | $ | 2,122 |  |  | $ | 5,362 |  |  | $ | 1,326 |  |  | $ | 1,458 |  |  | $ | 1,478 |  |  | $ | 201 |  |  | $ | 12,619 |
Provision (credit) for loan losses |  |  | 71 |  |  |  | 477 |  |  |  | 2,527 |  |  |  | 372 |  |  |  | 573 |  |  |  | 338 |  |  |  | 66 |  |  |  | 4,424 |
Recoveries of loans charged-off |  |  | 1 |  |  |  | 5 |  |  |  | 3 |  |  |  | - |  |  |  | 13 |  |  |  | - |  |  |  | 277 |  |  |  | 299 |
Loans charged-off |  |  | - |  |  |  | (18 | ) |  |  | (444 | ) |  |  | - |  |  |  | (628 | ) |  |  | (48 | ) |  |  | (272 | ) |  |  | (1,410 | )
Balance, September 30, 2020 |  | $ | 744 |  |  | $ | 2,586 |  |  | $ | 7,448 |  |  | $ | 1,698 |  |  | $ | 1,416 |  |  | $ | 1,768 |  |  | $ | 272 |  |  | $ | 15,932 |
|  | Three Months Ended September 30, 2019 |
|  |  |  |  |  | 1-4 Family |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | Construction |  |  | Residential |  |  | Commercial |  |  | Agricultural |  |  |  |  |  |  |  |  |  |  | Consumer |  |  |  |  |
|  | Real Estate |  |  | Real Estate |  |  | Real Estate |  |  | Real Estate |  |  | Commercial |  |  | Agricultural |  |  | and Other |  |  | Total |
Balance, June 30, 2019 |  | $ | 721 |  |  | $ | 1,847 |  |  | $ | 4,906 |  |  | $ | 1,301 |  |  | $ | 1,590 |  |  | $ | 1,332 |  |  | $ | 172 |  |  | $ | 11,869 |
Provision (credit) for loan losses |  |  | 41 |  |  |  | 237 |  |  |  | 158 |  |  |  | 9 |  |  |  | (112 | ) |  |  | 10 |  |  |  | 36 |  |  |  | 379 |
Recoveries of loans charged-off |  |  | - |  |  |  | 2 |  |  |  | 3 |  |  |  | - |  |  |  | 5 |  |  |  | - |  |  |  | 2 |  |  |  | 12 |
Loans charged-off |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (326 | ) |  |  | - |  |  |  | - |  |  |  | (326 | )
Balance, September 30, 2019 |  | $ | 762 |  |  | $ | 2,086 |  |  | $ | 5,067 |  |  | $ | 1,310 |  |  | $ | 1,157 |  |  | $ | 1,342 |  |  | $ | 210 |  |  | $ | 11,934 |
|  | Nine Months Ended September 30, 2019 |
|  |  |  |  |  | 1-4 Family |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | Construction |  |  | Residential |  |  | Commercial |  |  | Agricultural |  |  |  |  |  |  |  |  |  |  | Consumer |  |  |  |  |
|  | Real Estate |  |  | Real Estate |  |  | Real Estate |  |  | Real Estate |  |  | Commercial |  |  | Agricultural |  |  | and Other |  |  | Total |
Balance, December 31, 2018 |  | $ | 699 |  |  | $ | 1,820 |  |  | $ | 4,615 |  |  | $ | 1,198 |  |  | $ | 1,777 |  |  | $ | 1,384 |  |  | $ | 191 |  |  | $ | 11,684 |
Provision (credit) for loan losses |  |  | 63 |  |  |  | 265 |  |  |  | 437 |  |  |  | 112 |  |  |  | (324 | ) |  |  | (42 | ) |  |  | 34 |  |  |  | 545 |
Recoveries of loans charged-off |  |  | - |  |  |  | 4 |  |  |  | 15 |  |  |  | - |  |  |  | 34 |  |  |  | - |  |  |  | 6 |  |  |  | 59 |
Loans charged-off |  |  | - |  |  |  | (3 | ) |  |  | - |  |  |  | - |  |  |  | (330 | ) |  |  | - |  |  |  | (21 | ) |  |  | (354 | )
Balance, September 30, 2019 |  | $ | 762 |  |  | $ | 2,086 |  |  | $ | 5,067 |  |  | $ | 1,310 |  |  | $ | 1,157 |  |  | $ | 1,342 |  |  | $ | 210 |  |  | $ | 11,934 |
Allowance for loan losses disaggregated on the basis of impairment analysis method as of September 30, 2020 and December 31, 2019 is as follows (in thousands):
2020 |  |  |  |  |  | 1-4 Family |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | Construction |  |  | Residential |  |  | Commercial |  |  | Agricultural |  |  |  |  |  |  |  |  |  |  | Consumer |  |  |  |  |
|  | Real Estate |  |  | Real Estate |  |  | Real Estate |  |  | Real Estate |  |  | Commercial |  |  | Agricultural |  |  | and Other |  |  | Total |
Individually evaluated for impairment |  | $ | - |  |  | $ | 150 |  |  | $ | - |  |  | $ | - |  |  | $ | 2 |  |  | $ | 41 |  |  | $ | 30 |  |  | $ | 223 |
Collectively evaluated for impairment |  |  | 744 |  |  |  | 2,436 |  |  |  | 7,448 |  |  |  | 1,698 |  |  |  | 1,414 |  |  |  | 1,727 |  |  |  | 242 |  |  |  | 15,709 |
Balance September 30, 2020 |  | $ | 744 |  |  | $ | 2,586 |  |  | $ | 7,448 |  |  | $ | 1,698 |  |  | $ | 1,416 |  |  | $ | 1,768 |  |  | $ | 272 |  |  | $ | 15,932 |
2019 |  |  |  |  |  | 1-4 Family |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | Construction |  |  | Residential |  |  | Commercial |  |  | Agricultural |  |  |  |  |  |  |  |  |  |  | Consumer |  |  |  |  |
|  | Real Estate |  |  | Real Estate |  |  | Real Estate |  |  | Real Estate |  |  | Commercial |  |  | Agricultural |  |  | and Other |  |  | Total |
Individually evaluated for impairment |  | $ | - |  |  | $ | 209 |  |  | $ | - |  |  | $ | - |  |  | $ | - |  |  | $ | - |  |  | $ | - |  |  | $ | 209 |
Collectively evaluated for impairment |  |  | 672 |  |  |  | 1,913 |  |  |  | 5,362 |  |  |  | 1,326 |  |  |  | 1,458 |  |  |  | 1,478 |  |  |  | 201 |  |  |  | 12,410 |
Balance December 31, 2019 |  | $ | 672 |  |  | $ | 2,122 |  |  | $ | 5,362 |  |  | $ | 1,326 |  |  | $ | 1,458 |  |  | $ | 1,478 |  |  | $ | 201 |  |  | $ | 12,619 |
Loans receivable disaggregated on the basis of impairment analysis method as of September 30, 2020 and December 31, 2019 is as follows (in thousands):
2020 |  |  |  |  |  | 1-4 Family |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | Construction |  |  | Residential |  |  | Commercial |  |  | Agricultural |  |  |  |  |  |  |  |  |  |  | Consumer |  |  |  |  |
|  | Real Estate |  |  | Real Estate |  |  | Real Estate |  |  | Real Estate |  |  | Commercial |  |  | Agricultural |  |  | and Other |  |  | Total |
Individually evaluated for impairment |  | $ | 165 |  |  | $ | 1,332 |  |  | $ | 11,046 |  |  | $ | 1,868 |  |  | $ | 949 |  |  | $ | 977 |  |  | $ | 51 |  |  | $ | 16,388 |
Collectively evaluated for impairment |  |  | 45,356 |  |  |  | 209,907 |  |  |  | 480,353 |  |  |  | 155,627 |  |  |  | 151,758 |  |  |  | 101,222 |  |  |  | 16,488 |  |  |  | 1,160,711 |
Balance September 30, 2020 |  | $ | 45,521 |  |  | $ | 211,239 |  |  | $ | 491,399 |  |  | $ | 157,495 |  |  | $ | 152,707 |  |  | $ | 102,199 |  |  | $ | 16,539 |  |  | $ | 1,177,099 |
2019 |  |  |  |  |  | 1-4 Family |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | Construction |  |  | Residential |  |  | Commercial |  |  | Agricultural |  |  |  |  |  |  |  |  |  |  | Consumer |  |  |  |  |
|  | Real Estate |  |  | Real Estate |  |  | Real Estate |  |  | Real Estate |  |  | Commercial |  |  | Agricultural |  |  | and Other |  |  | Total |
Individually evaluated for impairment |  | $ | - |  |  | $ | 1,204 |  |  | $ | 83 |  |  | $ | 84 |  |  | $ | 462 |  |  | $ | 2,951 |  |  | $ | 4 |  |  | $ | 4,788 |
Collectively evaluated for impairment |  |  | 47,895 |  |  |  | 200,306 |  |  |  | 435,767 |  |  |  | 160,687 |  |  |  | 83,622 |  |  |  | 108,994 |  |  |  | 18,787 |  |  |  | 1,056,058 |
Balance December 31, 2019 |  | $ | 47,895 |  |  | $ | 201,510 |  |  | $ | 435,850 |  |  | $ | 160,771 |  |  | $ | 84,084 |  |  | $ | 111,945 |  |  | $ | 18,791 |  |  | $ | 1,060,846 |
A loan is considered impaired when, based on current information and events, it is probable that the Company will be unable to collect the scheduled payment of principal and interest when due according to the contractual terms of the loan agreement. Factors considered by management in determining impairment include payment status, collateral value, and the probability of collecting scheduled principal and interest payments when due. The Company applies its normal loan review procedures to identify loans that should be evaluated for impairment. Impaired loans, on a disaggregated basis, as of September 30, 2020 and December 31, 2019 (in thousands):
|  | 2020 |  |  | 2019 |
|  |  |  |  |  | Unpaid |  |  |  |  |  |  |  |  |  |  | Unpaid |  |  |  |  |
|  | Recorded |  |  | Principal |  |  | Related |  |  | Recorded |  |  | Principal |  |  | Related |
|  | Investment |  |  | Balance |  |  | Allowance |  |  | Investment |  |  | Balance |  |  | Allowance |
With no specific reserve recorded: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Real estate - construction |  | $ | 165 |  |  | $ | 165 |  |  | $ | - |  |  | $ | - |  |  | $ | - |  |  | $ | - |
Real estate - 1 to 4 family residential |  |  | 386 |  |  |  | 436 |  |  |  | - |  |  |  | 460 |  |  |  | 796 |  |  |  | - |
Real estate - commercial |  |  | 11,046 |  |  |  | 11,836 |  |  |  | - |  |  |  | 83 |  |  |  | 435 |  |  |  | - |
Real estate - agricultural |  |  | 1,868 |  |  |  | 1,885 |  |  |  | - |  |  |  | 84 |  |  |  | 97 |  |  |  | - |
Commercial |  |  | 947 |  |  |  | 1,567 |  |  |  | - |  |  |  | 462 |  |  |  | 517 |  |  |  | - |
Agricultural |  |  | 448 |  |  |  | 605 |  |  |  | - |  |  |  | 2,951 |  |  |  | 3,071 |  |  |  | - |
Consumer and other |  |  | 10 |  |  |  | 10 |  |  |  | - |  |  |  | 4 |  |  |  | 4 |  |  |  | - |
Total loans with no specific reserve: |  |  | 14,870 |  |  |  | 16,504 |  |  |  | - |  |  |  | 4,044 |  |  |  | 4,920 |  |  |  | - |
With an allowance recorded: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Real estate - construction |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
Real estate - 1 to 4 family residential |  |  | 946 |  |  |  | 1,283 |  |  |  | 150 |  |  |  | 744 |  |  |  | 755 |  |  |  | 209 |
Real estate - commercial |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
Real estate - agricultural |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
Commercial |  |  | 2 |  |  |  | 2 |  |  |  | 2 |  |  |  | - |  |  |  | - |  |  |  | - |
Agricultural |  |  | 529 |  |  |  | 531 |  |  |  | 41 |  |  |  | - |  |  |  | - |  |  |  | - |
Consumer and other |  |  | 41 |  |  |  | 43 |  |  |  | 30 |  |  |  | - |  |  |  | - |  |  |  | - |
Total loans with specific reserve: |  |  | 1,518 |  |  |  | 1,859 |  |  |  | 223 |  |  |  | 744 |  |  |  | 755 |  |  |  | 209 |
Total |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Real estate - construction |  |  | 165 |  |  |  | 165 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
Real estate - 1 to 4 family residential |  |  | 1,332 |  |  |  | 1,719 |  |  |  | 150 |  |  |  | 1,204 |  |  |  | 1,551 |  |  |  | 209 |
Real estate - commercial |  |  | 11,046 |  |  |  | 11,836 |  |  |  | - |  |  |  | 83 |  |  |  | 435 |  |  |  | - |
Real estate - agricultural |  |  | 1,868 |  |  |  | 1,885 |  |  |  | - |  |  |  | 84 |  |  |  | 97 |  |  |  | - |
Commercial |  |  | 949 |  |  |  | 1,569 |  |  |  | 2 |  |  |  | 462 |  |  |  | 517 |  |  |  | - |
Agricultural |  |  | 977 |  |  |  | 1,136 |  |  |  | 41 |  |  |  | 2,951 |  |  |  | 3,071 |  |  |  | - |
Consumer and other |  |  | 51 |  |  |  | 53 |  |  |  | 30 |  |  |  | 4 |  |  |  | 4 |  |  |  | - |
|  | $ | 16,388 |  |  | $ | 18,363 |  |  | $ | 223 |  |  | $ | 4,788 |  |  | $ | 5,675 |  |  | $ | 209 |
Average recorded investment and interest income recognized on impaired loans for the three and nine months ended September 30, 2020 and 2019 (in thousands):
|  | Three Months Ended September 30, |
|  | 2020 |  |  | 2019 |
|  | Average |  |  | Interest |  |  | Average |  |  | Interest |
|  | Recorded |  |  | Income |  |  | Recorded |  |  | Income |
|  | Investment |  |  | Recognized |  |  | Investment |  |  | Recognized |
With no specific reserve recorded: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Real estate - construction |  | $ | 83 |  |  | $ | - |  |  | $ | - |  |  | $ | - |
Real estate - 1 to 4 family residential |  |  | 305 |  |  |  | - |  |  |  | 364 |  |  |  | 4 |
Real estate - commercial |  |  | 11,091 |  |  |  | - |  |  |  | 637 |  |  |  | 45 |
Real estate - agricultural |  |  | 1,966 |  |  |  | - |  |  |  | 86 |  |  |  | - |
Commercial |  |  | 735 |  |  |  | 21 |  |  |  | 240 |  |  |  | - |
Agricultural |  |  | 813 |  |  |  | 340 |  |  |  | 2,206 |  |  |  | - |
Consumer and other |  |  | 8 |  |  |  | - |  |  |  | - |  |  |  | - |
Total loans with no specific reserve: |  |  | 15,001 |  |  |  | 361 |  |  |  | 3,533 |  |  |  | 49 |
With an allowance recorded: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Real estate - construction |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
Real estate - 1 to 4 family residential |  |  | 957 |  |  |  | - |  |  |  | 341 |  |  |  | - |
Real estate - commercial |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
Real estate - agricultural |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
Commercial |  |  | 627 |  |  |  | - |  |  |  | 1,267 |  |  |  | - |
Agricultural |  |  | 531 |  |  |  | - |  |  |  | - |  |  |  | - |
Consumer and other |  |  | 30 |  |  |  | - |  |  |  | 5 |  |  |  | - |
Total loans with specific reserve: |  |  | 2,145 |  |  |  | - |  |  |  | 1,613 |  |  |  | - |
Total |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Real estate - construction |  |  | 83 |  |  |  | - |  |  |  | - |  |  |  | - |
Real estate - 1 to 4 family residential |  |  | 1,262 |  |  |  | - |  |  |  | 705 |  |  |  | 4 |
Real estate - commercial |  |  | 11,091 |  |  |  | - |  |  |  | 637 |  |  |  | 45 |
Real estate - agricultural |  |  | 1,966 |  |  |  | - |  |  |  | 86 |  |  |  | - |
Commercial |  |  | 1,362 |  |  |  | 21 |  |  |  | 1,507 |  |  |  | - |
Agricultural |  |  | 1,344 |  |  |  | 340 |  |  |  | 2,206 |  |  |  | - |
Consumer and other |  |  | 38 |  |  |  | - |  |  |  | 5 |  |  |  | - |
|  | $ | 17,146 |  |  | $ | 361 |  |  | $ | 5,146 |  |  | $ | 49 |
|  | Nine Months Ended September 30, |
|  | 2020 |  |  | 2019 |
|  | Average |  |  | Interest |  |  | Average |  |  | Interest |
|  | Recorded |  |  | Income |  |  | Recorded |  |  | Income |
|  | Investment |  |  | Recognized |  |  | Investment |  |  | Recognized |
With no specific reserve recorded: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Real estate - construction |  | $ | 41 |  |  | $ | - |  |  | $ | - |  |  | $ | - |
Real estate - 1 to 4 family residential |  |  | 294 |  |  |  | - |  |  |  | 305 |  |  |  | 30 |
Real estate - commercial |  |  | 8,221 |  |  |  | - |  |  |  | 384 |  |  |  | 105 |
Real estate - agricultural |  |  | 1,202 |  |  |  | 6 |  |  |  | 79 |  |  |  | - |
Commercial |  |  | 586 |  |  |  | 23 |  |  |  | 241 |  |  |  | - |
Agricultural |  |  | 1,896 |  |  |  | 340 |  |  |  | 1,103 |  |  |  | - |
Consumer and other |  |  | 26 |  |  |  | - |  |  |  | - |  |  |  | - |
Total loans with no specific reserve: |  |  | 12,266 |  |  |  | 369 |  |  |  | 2,112 |  |  |  | 135 |
With an allowance recorded: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Real estate - construction |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
Real estate - 1 to 4 family residential |  |  | 938 |  |  |  | - |  |  |  | 226 |  |  |  | - |
Real estate - commercial |  |  | 244 |  |  |  | - |  |  |  | - |  |  |  | - |
Real estate - agricultural |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
Commercial |  |  | 356 |  |  |  | - |  |  |  | 1,867 |  |  |  | - |
Agricultural |  |  | 380 |  |  |  | - |  |  |  | - |  |  |  | - |
Consumer and other |  |  | 15 |  |  |  | - |  |  |  | 10 |  |  |  | 1 |
Total loans with specific reserve: |  |  | 1,933 |  |  |  | - |  |  |  | 2,103 |  |  |  | 1 |
Total |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Real estate - construction |  |  | 41 |  |  |  | - |  |  |  | - |  |  |  | - |
Real estate - 1 to 4 family residential |  |  | 1,232 |  |  |  | - |  |  |  | 531 |  |  |  | 30 |
Real estate - commercial |  |  | 8,465 |  |  |  | - |  |  |  | 384 |  |  |  | 105 |
Real estate - agricultural |  |  | 1,202 |  |  |  | 6 |  |  |  | 79 |  |  |  | - |
Commercial |  |  | 942 |  |  |  | 23 |  |  |  | 2,108 |  |  |  | - |
Agricultural |  |  | 2,276 |  |  |  | 340 |  |  |  | 1,103 |  |  |  | - |
Consumer and other |  |  | 41 |  |  |  | - |  |  |  | 10 |  |  |  | 1 |
|  | $ | 14,199 |  |  | $ | 369 |  |  | $ | 4,215 |  |  | $ | 136 |
The interest foregone on nonaccrual loans for the three months ended September 30, 2020 and 2019 was approximately $247,000 and $272,000, respectively. The interest foregone on nonaccrual loans for the nine months ended September 30, 2020 and 2019 was approximately $747,000 and $389,000, respectively. Nonaccrual loans at September 30, 2020 and December 31, 2019 were $16,388,000 and $4,788,000 respectively. The Company had loans meeting the definition of a troubled debt restructuring (TDR) of $11,480,000 as of September 30, 2020, all of which were included in impaired and nonaccrual loans. The Company had TDRs of $1,171,000 as of December 31, 2019, all of which were included in impaired and nonaccrual loans. The Company’s TDR, on a disaggregated basis, occurring in the three and nine months ended September 30, 2020 and 2019, is as follows (dollars in thousands):
|  | Three Months Ended September 30, |
|  | 2020 |  |  | 2019 |
|  |  |  |  |  | Pre-Modification |  |  | Post-Modification |  |  |  |  |  |  | Pre-Modification |  |  | Post-Modification |
|  |  |  |  |  | Outstanding |  |  | Outstanding |  |  |  |  |  |  | Outstanding |  |  | Outstanding |
|  | Number of |  |  | Recorded |  |  | Recorded |  |  | Number of |  |  | Recorded |  |  | Recorded |
|  | Contracts |  |  | Investment |  |  | Investment |  |  | Contracts |  |  | Investment |  |  | Investment |
Real estate - construction |  |  | - |  |  | $ | - |  |  | $ | - |  |  |  | - |  |  | $ | - |  |  | $ | - |
Real estate - 1 to 4 family residential |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 3 |  |  |  | 1,035 |  |  |  | 1,035 |
Real estate - commercial |  |  | 1 |  |  |  | 10,157 |  |  |  | 10,157 |  |  |  | - |  |  |  | - |  |  |  | - |
Real estate - agricultural |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
Commercial |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
Agricultural |  |  | 3 |  |  |  | 56 |  |  |  | 56 |  |  |  | - |  |  |  | - |  |  |  | - |
Consumer and other |  |  | 1 |  |  |  | 27 |  |  |  | 27 |  |  |  | - |  |  |  | - |  |  |  | - |
|  |  | 5 |  |  | $ | 10,240 |  |  | $ | 10,240 |  |  |  | 3 |  |  | $ | 1,035 |  |  | $ | 1,035 |
|  | Nine Months Ended September 30, |
|  | 2020 |  |  | 2019 |
|  |  |  |  |  | Pre-Modification |  |  | Post-Modification |  |  |  |  |  |  | Pre-Modification |  |  | Post-Modification |
|  |  |  |  |  | Outstanding |  |  | Outstanding |  |  |  |  |  |  | Outstanding |  |  | Outstanding |
|  | Number of |  |  | Recorded |  |  | Recorded |  |  | Number of |  |  | Recorded |  |  | Recorded |
|  | Contracts |  |  | Investment |  |  | Investment |  |  | Contracts |  |  | Investment |  |  | Investment |
Real estate - construction |  |  | - |  |  | $ | - |  |  | $ | - |  |  |  | - |  |  | $ | - |  |  | $ | - |
Real estate - 1 to 4 family residential |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 3 |  |  |  | 1,035 |  |  |  | 1,035 |
Real estate - commercial |  |  | 2 |  |  |  | 10,341 |  |  |  | 10,341 |  |  |  | - |  |  |  | - |  |  |  | - |
Real estate - agricultural |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
Commercial |  |  | 1 |  |  |  | 61 |  |  |  | 61 |  |  |  | - |  |  |  | - |  |  |  | - |
Agricultural |  |  | 3 |  |  |  | 56 |  |  |  | 56 |  |  |  | - |  |  |  | - |  |  |  | - |
Consumer and other |  |  | 1 |  |  |  | 27 |  |  |  | 27 |  |  |  | - |  |  |  | - |  |  |  | - |
|  |  | 7 |  |  | $ | 10,485 |  |  | $ | 10,485 |  |  |  | 3 |  |  | $ | 1,035 |  |  | $ | 1,035 |
During the three months ended September 30, 2020, the Company granted concessions to three borrowers facing financial difficulties which were unrelated to COVID-19. Payments on these loans were deferred for an extended period of time and the interest rate was reduced below the market interest rate. During the nine months ended September 30, 2020, the Company granted concessions to five borrowers facing financial difficulties. Payments on these loans were deferred for an extended period of time and the interest rate was reduced below the market interest rate. During the three and nine months ended September 30, 2019, the Company granted concessions to one borrower with three 1-4 family residential contracts facing financial difficulties. The loans were originated with terms less than normal related to collateral. There were no TDR loans that were modified during the twelve months ended September 30, 2020 and 2019 that had payment defaults. The Company considers TDR loans to have payment default when it is past due 60 days or more. There were $15,000 and $31,000 of net charge-offs related to TDRs for the three and nine months ended September 30, 2020, respectively. There were $275,000 of net charge-offs related to TDRs for the three and nine months ended September 30, 2019. Section 4013 of the CARES Act, “Temporary Relief From Troubled Debt Restructurings,” allows financial institutions the option to temporarily suspend certain requirements under U.S. GAAP related to TDRs for a limited period of time during the COVID-19 pandemic. In March 2020, various regulatory agencies, including the Board of Governors of the Federal Reserve System and the FDIC, (the "agencies") issued an interagency statement on loan modifications and reporting for financial institutions working with customers affected by COVID-19. The interagency statement was effective immediately and impacted accounting for loan modifications. The agencies confirmed with the staff of the FASB that short-term modifications made on a good faith basis in response to COVID-19 to borrowers who were current prior to any relief, are not to be considered TDRs. This includes short-term (e.g., six months) modifications, such as payment deferrals, fee waivers, extensions of repayment terms, or other delays in payment that are insignificant. Borrowers considered current are those that are less than 30 days past due on their contractual payments at the time a modification program is implemented. As of September 30, 2020, the Company had executed 199 COVID-19 related loan modifications under these rules on a total outstanding principal balance of $127.5 million. Of those loans, 100 loans with a total outstanding principal balance of $94.8 million remain on deferral, including $11.7 million of loans that were less than 30 days past due after the modification period expired. The remaining loans of $32.7 million have been returned to a normal payment status. These loans did not have financial difficulty prior to the COVID-19 pandemic and were generally modified for principal and interest payment deferral or interest only payments for up to six months. Modified loans continue to accrue interest and are evaluated for past due status based on the revised payment terms. An aging analysis of the recorded investments in loans, on a disaggregated basis, as of September 30, 2020 and December 31, 2019, is as follows (in thousands):
2020 |  |  |  |  |  | 90 Days |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 90 Days |
|  | 30-89 |  |  | or Greater |  |  | Total |  |  |  |  |  |  |  |  |  |  | or Greater |
|  | Past Due |  |  | Past Due |  |  | Past Due |  |  | Current |  |  | Total |  |  | Accruing |
Real estate - construction |  | $ | 26 |  |  | $ | 165 |  |  | $ | 191 |  |  | $ | 45,330 |  |  | $ | 45,521 |  |  | $ | - |
Real estate - 1 to 4 family residential |  |  | 763 |  |  |  | 385 |  |  |  | 1,148 |  |  |  | 210,091 |  |  |  | 211,239 |  |  |  | 131 |
Real estate - commercial |  |  | 176 |  |  |  | 75 |  |  |  | 251 |  |  |  | 491,148 |  |  |  | 491,399 |  |  |  | - |
Real estate - agricultural |  |  | 1,014 |  |  |  | 1,835 |  |  |  | 2,849 |  |  |  | 154,646 |  |  |  | 157,495 |  |  |  | 33 |
Commercial |  |  | 104 |  |  |  | 647 |  |  |  | 751 |  |  |  | 151,956 |  |  |  | 152,707 |  |  |  | - |
Agricultural |  |  | 574 |  |  |  | 472 |  |  |  | 1,046 |  |  |  | 101,153 |  |  |  | 102,199 |  |  |  | - |
Consumer and other |  |  | 37 |  |  |  | 36 |  |  |  | 73 |  |  |  | 16,466 |  |  |  | 16,539 |  |  |  | 16 |
|  | $ | 2,694 |  |  | $ | 3,615 |  |  | $ | 6,309 |  |  | $ | 1,170,790 |  |  | $ | 1,177,099 |  |  | $ | 180 |
2019 |  |  |  |  |  | 90 Days |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 90 Days |
|  | 30-89 |  |  | or Greater |  |  | Total |  |  |  |  |  |  |  |  |  |  | or Greater |
|  | Past Due |  |  | Past Due |  |  | Past Due |  |  | Current |  |  | Total |  |  | Accruing |
Real estate - construction |  | $ | 1,796 |  |  | $ | - |  |  | $ | 1,796 |  |  | $ | 46,099 |  |  | $ | 47,895 |  |  | $ | - |
Real estate - 1 to 4 family residential |  |  | 811 |  |  |  | 290 |  |  |  | 1,101 |  |  |  | 200,409 |  |  |  | 201,510 |  |  |  | 188 |
Real estate - commercial |  |  | 387 |  |  |  | - |  |  |  | 387 |  |  |  | 435,463 |  |  |  | 435,850 |  |  |  | - |
Real estate - agricultural |  |  | 422 |  |  |  | - |  |  |  | 422 |  |  |  | 160,349 |  |  |  | 160,771 |  |  |  | - |
Commercial |  |  | 518 |  |  |  | 237 |  |  |  | 755 |  |  |  | 83,329 |  |  |  | 84,084 |  |  |  | - |
Agricultural |  |  | 666 |  |  |  | 2,587 |  |  |  | 3,253 |  |  |  | 108,692 |  |  |  | 111,945 |  |  |  | 62 |
Consumer and other |  |  | 146 |  |  |  | 6 |  |  |  | 152 |  |  |  | 18,639 |  |  |  | 18,791 |  |  |  | 5 |
|  | $ | 4,746 |  |  | $ | 3,120 |  |  | $ | 7,866 |  |  | $ | 1,052,980 |  |  | $ | 1,060,846 |  |  | $ | 255 |
The credit risk profile by internally assigned grade, on a disaggregated basis, as of September 30, 2020 and December 31, 2019 is as follows (in thousands):
2020 |  | Construction |  |  | Commercial |  |  | Agricultural |  |  |  |  |  |  |  |  |  |  |  |  |
|  | Real Estate |  |  | Real Estate |  |  | Real Estate |  |  | Commercial |  |  | Agricultural |  |  | Total |
Pass |  | $ | 39,626 |  |  | $ | 380,297 |  |  | $ | 113,790 |  |  | $ | 132,487 |  |  | $ | 76,116 |  |  | $ | 742,316 |
Watch |  |  | 5,730 |  |  |  | 74,178 |  |  |  | 34,810 |  |  |  | 14,820 |  |  |  | 23,843 |  |  |  | 153,381 |
Special Mention |  |  | - |  |  |  | 3,200 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 3,200 |
Substandard |  |  | - |  |  |  | 22,678 |  |  |  | 7,027 |  |  |  | 4,451 |  |  |  | 1,263 |  |  |  | 35,419 |
Substandard-Impaired |  |  | 165 |  |  |  | 11,046 |  |  |  | 1,868 |  |  |  | 949 |  |  |  | 977 |  |  |  | 15,005 |
|  | $ | 45,521 |  |  | $ | 491,399 |  |  | $ | 157,495 |  |  | $ | 152,707 |  |  | $ | 102,199 |  |  | $ | 949,321 |
2019 |  | Construction |  |  | Commercial |  |  | Agricultural |  |  |  |  |  |  |  |  |  |  |  |  |
|  | Real Estate |  |  | Real Estate |  |  | Real Estate |  |  | Commercial |  |  | Agricultural |  |  | Total |
Pass |  | $ | 41,073 |  |  | $ | 387,274 |  |  | $ | 118,692 |  |  | $ | 62,655 |  |  | $ | 90,083 |  |  | $ | 699,777 |
Watch |  |  | 6,822 |  |  |  | 29,209 |  |  |  | 32,780 |  |  |  | 16,147 |  |  |  | 15,248 |  |  |  | 100,206 |
Special Mention |  |  | - |  |  |  | 4,581 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 4,581 |
Substandard |  |  | - |  |  |  | 14,703 |  |  |  | 9,215 |  |  |  | 4,820 |  |  |  | 3,663 |  |  |  | 32,401 |
Substandard-Impaired |  |  | - |  |  |  | 83 |  |  |  | 84 |  |  |  | 462 |  |  |  | 2,951 |  |  |  | 3,580 |
|  | $ | 47,895 |  |  | $ | 435,850 |  |  | $ | 160,771 |  |  | $ | 84,084 |  |  | $ | 111,945 |  |  | $ | 840,545 |
The credit risk profile based on payment activity, on a disaggregated basis, as of September 30, 2020 and December 31, 2019 is as follows (in thousands):
2020 |  | 1-4 Family |  |  |  |  |  |  |  |  |
|  | Residential |  |  | Consumer |  |  |  |  |
|  | Real Estate |  |  | and Other |  |  | Total |
Performing |  | $ | 209,778 |  |  | $ | 16,472 |  |  | $ | 226,250 |
Non-performing |  |  | 1,461 |  |  |  | 67 |  |  |  | 1,528 |
|  | $ | 211,239 |  |  | $ | 16,539 |  |  | $ | 227,778 |
2019 |  | 1-4 Family |  |  |  |  |  |  |  |  |
|  | Residential |  |  | Consumer |  |  |  |  |
|  | Real Estate |  |  | and Other |  |  | Total |
Performing |  | $ | 200,117 |  |  | $ | 18,782 |  |  | $ | 218,899 |
Non-performing |  |  | 1,393 |  |  |  | 9 |  |  |  | 1,402 |
|  | $ | 201,510 |  |  | $ | 18,791 |  |  | $ | 220,301 |

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