XML 40 R29.htm IDEA: XBRL DOCUMENT

Loans and Allowance for Loan Losses (Tables)

6 Months Ended

Jun. 30, 2020

Allowance For Loan And Lease Losses Writeoffs Net [Abstract]

As of June 30, 2020 and December 31, 2019, the composition of the loan portfolio by reporting segment and portfolio segment was as follows:

	June 30, 2020
	Bank		ALC		Total
	(Dollars in Thousands)
Real estate loans:
Construction, land development and other land loans	$	31,384	$	—	$	31,384
Secured by 1-4 family residential properties		88,549		4,461		93,010
Secured by multi-family residential properties		48,807		—		48,807
Secured by non-farm, non-residential properties		160,683		—		160,683
Commercial and industrial loans ⁽¹⁾		87,771		—		87,771
Consumer loans:
Direct consumer		7,340		25,959		33,299
Branch retail		—		33,000		33,000
Indirect sales ⁽²⁾		89,932		—		89,932
Total loans		514,466		63,420		577,886
Less: Unearned interest, fees and deferred cost		578		4,823		5,401
Allowance for loan losses		4,568		1,855		6,423
Net loans	$	509,320	$	56,742	$	566,062

	December 31, 2019
	Bank		ALC		Total
	(Dollars in Thousands)
Real estate loans:
Construction, land development and other land loans	$	30,820	$	—	$	30,820
Secured by 1-4 family residential properties		98,971		5,566		104,537
Secured by multi-family residential properties		50,910		—		50,910
Secured by non-farm, non-residential properties		162,981		—		162,981
Commercial and industrial loans ⁽¹⁾		90,957		—		90,957
Consumer loans:
Direct consumer		7,816		30,224		38,040
Branch retail		—		32,305		32,305
Indirect sales ⁽²⁾		—		45,503		45,503
Total loans		442,455		113,598		556,053
Less: Unearned interest, fees and deferred cost		262		4,786		5,048
Allowance for loan losses		3,483		2,279		5,762
Net loans	$	438,710	$	106,533	$	545,243

(1)

Includes equipment financing leases.

(2)

Effective January 1, 2020, the Company transferred a total of $45.5 million of its indirect sales portfolio from ALC to the Bank.

Summary of Acquired Loans

The carrying amount of PCI loans, which is included within loans on the condensed consolidated balance sheet, is set forth in the table below as of June 30, 2020 and December 31, 2019:

	June 30, 2020			December 31, 2019
	(Dollars in Thousands)
Real estate loans:
Secured by 1-4 family residential properties	$	200		$	224
Outstanding balance		200			224
Fair value adjustment		(33	)		(49	)
Carrying amount, net of fair value adjustment	$	167		$	175

Allowance for Loan Losses

The following tables present changes in the allowance for loan losses during the six months ended June 30, 2020 and 2019 and the related loan balances by loan type as of June 30, 2020 and 2019:

	As of and for the Six Months Ended June 30, 2020
	Construction, Land Development, and Other		1-4 Family			Real Estate Multi- Family		Non- Farm Non- Residential		Commercial and Industrial			Direct Consumer			Branch Retail			Indirect Sales			Total
	(Dollars in Thousands)
Allowance for loan losses:
Beginning balance	$	197	$	466		$	422	$	964	$	1,377		$	1,625		$	395		$	316		$	5,762
Charge-offs		—		(42	)		—		—		—			(962	)		(221	)		(38	)		(1,263	)
Recoveries		—		14			—		8		—			381			90			1			494
Provision		72		84			70		272		(448	)		373			211			796			1,430
Ending balance	$	269	$	522		$	492	$	1,244	$	929		$	1,417		$	475		$	1,075		$	6,423
Ending balance of allowance attributable to loans:
Individually evaluated for impairment	$	—	$	13		$	—	$	—	$	62		$	3		$	—		$	—		$	78
Collectively evaluated for impairment		269		509			492		1,244		867			1,414			475			1,075			6,345
Total allowance for loan losses	$	269	$	522		$	492	$	1,244	$	929		$	1,417		$	475		$	1,075		$	6,423
Ending balance of loans receivable:
Individually evaluated for impairment	$	—	$	785		$	—	$	2,748	$	62		$	25		$	—		$	—		$	3,620
Collectively evaluated for impairment		31,384		92,058			48,807		157,935		87,709			33,274			33,000			89,932			574,099
Loans acquired with deteriorated credit quality		—		167			—		—		—			—			—			—			167
Total loans receivable	$	31,384	$	93,010		$	48,807	$	160,683	$	87,771		$	33,299		$	33,000		$	89,932		$	577,886

	As of and for the Six Months Ended June 30, 2019
	Construction, Land Development, and Other			1-4 Family			Real Estate Multi- Family		Non- Farm Non- Residential			Commercial and Industrial		Direct Consumer			Branch Retail			Indirect Sales			Total
	(Dollars in Thousands)
Allowance for loan losses:
Beginning balance	$	241		$	346		$	128	$	831		$	1,138	$	1,799		$	427		$	145		$	5,055
Charge-offs		—			(77	)		—		—			—		(1,090	)		(201	)		(128	)		(1,496	)
Recoveries		—			15			—		—			3		334			59			2			413
Provision		(50	)		105			38		(22	)		63		646			151			184			1,115
Ending balance	$	191		$	389		$	166	$	809		$	1,204	$	1,689		$	436		$	203		$	5,087
Ending balance of allowance attributable to loans:
Individually evaluated for impairment	$	95		$	16		$	—	$	—		$	65	$	12		$	—		$	—		$	188
Collectively evaluated for impairment		96			373			166		809			1,139		1,677			436			203			4,899
Total allowance for loan losses	$	191		$	389		$	166	$	809		$	1,204	$	1,689		$	436		$	203		$	5,087
Ending balance of loans receivable:
Individually evaluated for impairment	$	421		$	1,141		$	—	$	504		$	65	$	35		$	—		$	—		$	2,166
Collectively evaluated for impairment		27,980			102,043			28,033		158,244			91,424		37,125			29,609			45,466			519,924
Loans acquired with deteriorated credit quality		—			170			—		—			—		—			—			—			170
Total loans receivable	$	28,401		$	103,354		$	28,033	$	158,748		$	91,489	$	37,160		$	29,609		$	45,466		$	522,260

Loans By Credit Quality Indicators

The tables below illustrate the carrying amount of loans by credit quality indicator as of June 30, 2020:

	June 30, 2020
	Pass 1-5			Special Mention 6			Substandard 7			Total
	(Dollars in Thousands)
Loans secured by real estate:
Construction, land development and other land loans	$	31,302		$	77		$	5		$	31,384
Secured by multi-family residential properties		48,807			—			—			48,807
Secured by non-farm, non-residential properties		156,033			2,783			1,867			160,683
Commercial and industrial loans		86,129			1,186			456			87,771
Total	$	322,271		$	4,046		$	2,328		$	328,645
As a percentage of total loans		98.06	%		1.23	%		0.71	%		100.00	%

	June 30, 2020
	Performing			Nonperforming			Total
	(Dollars in Thousands)
Loans secured by real estate:
Secured by 1-4 family residential properties	$	91,012		$	1,998		$	93,010
Consumer loans:
Direct consumer		32,942			357			33,299
Branch retail		32,933			67			33,000
Indirect sales		89,873			59			89,932
Total	$	246,760		$	2,481		$	249,241
As a percentage of total loans		99.00	%		1.00	%		100.00	%

The above amounts include PCI loans. As of June 30, 2020, $0.2 million of PCI loans were classified as “Nonperforming.”

The tables below illustrate the carrying amount of loans by credit quality indicator as of December 31, 2019:

	December 31, 2019
	Pass 1-5			Special Mention 6			Substandard 7			Total
	(Dollars in Thousands)
Loans secured by real estate:
Construction, land development and other land loans	$	30,466		$	354		$	—		$	30,820
Secured by multi-family residential properties		50,910			—			—			50,910
Secured by non-farm, non-residential properties		157,718			2,961			2,302			162,981
Commercial and industrial loans		88,463			714			1,780			90,957
Total	$	327,557		$	4,029		$	4,082		$	335,668
As a percentage of total loans		97.58	%		1.20	%		1.22	%		100.00	%

	December 31, 2019
	Performing			Nonperforming			Total
	(Dollars in Thousands)
Loans secured by real estate:
Secured by 1-4 family residential properties	$	102,176		$	2,361		$	104,537
Consumer loans:
Direct consumer		37,474			566			38,040
Branch retail		32,024			281			32,305
Indirect sales		45,503			—			45,503
Total	$	217,177		$	3,208		$	220,385
As a percentage of total loans		98.54	%		1.46	%		100.00	%

Aging Analysis of Past Due Loans

The following table provides an aging analysis of past due loans by class as of June 30, 2020:

	As of June 30, 2020
	30-59 Days Past Due			60-89 Days Past Due			90 Days Or Greater			Total Past Due			Current			Total Loans			Recorded Investment > 90 Days And Accruing
	(Dollars in Thousands)
Loans secured by real estate:
Construction, land development and other land loans	$	—		$	—		$	—		$	—		$	31,384		$	31,384		$	—
Secured by 1-4 family residential properties		97			31			96			224			92,786			93,010			—
Secured by multi-family residential properties		—			—			—			—			48,807			48,807			—
Secured by non-farm, non-residential properties		22			—			1,417			1,439			159,244			160,683			—
Commercial and industrial loans		58			12			—			70			87,701			87,771			—
Consumer loans:
Direct consumer		253			113			326			692			32,607			33,299			—
Branch retail		132			30			67			229			32,771			33,000			—
Indirect sales		166			—			59			225			89,707			89,932			—
Total	$	728		$	186		$	1,965		$	2,879		$	575,007		$	577,886		$	—
As a percentage of total loans		0.13	%		0.03	%		0.34	%		0.50	%		99.50	%		100.00	%

The above amounts include PCI loans. As of June 30, 2020, $0.2 million of PCI loans were 60-89 days past due.

The following table provides an aging analysis of past due loans by class as of December 31, 2019:

	As of December 31, 2019
	30-59 Days Past Due			60-89 Days Past Due			90 Days Or Greater			Total Past Due			Current			Total Loans			Recorded Investment > 90 Days And Accruing
	(Dollars in Thousands)
Loans secured by real estate:
Construction, land development and other land loans	$	—		$	—		$	—		$	—		$	30,820		$	30,820		$	—
Secured by 1-4 family residential properties		259			108			844			1,211			103,326			104,537			—
Secured by multi-family residential properties		—			—			—			—			50,910			50,910			—
Secured by non-farm, non-residential properties		30			—			1,419			1,449			161,532			162,981			—
Commercial and industrial loans		56			—			—			56			90,901			90,957			—
Consumer loans:
Direct consumer		387			287			531			1,205			36,835			38,040			—
Branch retail		444			189			281			914			31,391			32,305			—
Indirect sales		132			—			—			132			45,371			45,503			—
Total	$	1,308		$	584		$	3,075		$	4,967		$	551,086		$	556,053		$	—
As a percentage of total loans		0.24	%		0.11	%		0.55	%		0.89	%		99.11	%		100.00	%

The above amounts include PCI loans. As of December 31, 2019, $0.2 million of PCI loans were 60-89 days past due.

Non-accruing Loans

The following table provides an analysis of non-accruing loans by class as of June 30, 2020 and December 31, 2019:

	Loans on Non-Accrual Status
	June 30, 2020		December 31, 2019
	(Dollars in Thousands)
Loans secured by real estate:
Construction, land development and other land loans	$	5	$	8
Secured by 1-4 family residential properties		1,421		1,423
Secured by multi-family residential properties		—		—
Secured by non-farm, non-residential properties		1,421		1,426
Commercial and industrial loans		106		27
Consumer loans:
Direct consumer		336		558
Branch retail		67		281
Indirect sales		59		—
Total loans	$	3,415	$	3,723

Summarizes of All COVID19 Loan Payment Deferment and the Percentage of Loans

The table below summarizes all remaining COVID-19 loan payment deferments made by the Company as of June 30, 2020.

	As of June 30, 2020
	Number of Loans Deferred		Principal Balance of Loans Deferred		% of Portfolio Balance			Principal and Interest Deferments		Principal Only Deferments
	(Dollars in Thousands)
Loans secured by real estate:
Construction, land development and other land loans		7	$	4,544		14.5	%	$	4,544	$	—
Secured by 1-4 family residential properties		50		9,474		10.2	%		8,078		1,396
Secured by multi-family residential properties		12		29,726		60.9	%		15,523		14,203
Secured by non-farm, non-residential properties		49		42,797		26.6	%		37,073		5,724
Commercial and industrial loans		9		1,460		1.7	%		831		629
Consumer loans:
Direct consumer		442		2,188		6.6	%		2,188		—
Branch retail		172		1,856		5.6	%		1,856		—
Indirect sales		123		3,199		3.6	%		3,199		—
Total loans		864	$	95,244		16.5	%	$	73,292	$	21,952

Summarizes the At Risk Categories and the Relative Percentage of the Loan Portfolio

The table below summarizes the “at-risk” categories and the relative percentage of the Company’s loan portfolio for each as of June 30, 2020.

	June 30, 2020
	Balance of Risk Category		% of Total Loan Balance
	(Dollars in Thousands)
High-risk loan categories:
Hotels/motels	$	10,410		1.8	%
Dine-in restaurants		4,459		0.8	%
Total high-risk loans		14,869		2.6	%
Moderate-risk loan categories:
Fast food restaurants		5,326		0.9	%
Retail		34,587		6.0	%
1-4 family investment		21,874		3.8	%
Total moderate-risk loans		61,787		10.7	%
Total at-risk loans	$	76,656		13.3	%

Impaired Loans

As of June 30, 2020, the carrying amount of the Company’s impaired loans consisted of the following:

	June 30, 2020
	Carrying Amount		Unpaid Principal Balance		Related Allowances
	(Dollars in Thousands)
Impaired loans with no related allowance recorded
Loans secured by real estate
Construction, land development and other land loans	$	—	$	—	$	—
Secured by 1-4 family residential properties		932		932		—
Secured by multi-family residential properties		—		—		—
Secured by non-farm, non-residential properties		2,748		2,748		—
Commercial and industrial		—		—		—
Direct consumer		—		—		—
Total loans with no related allowance recorded	$	3,680	$	3,680	$	—
Impaired loans with an allowance recorded
Loans secured by real estate
Construction, land development and other land loans	$	—	$	—	$	—
Secured by 1-4 family residential properties		20		20		13
Secured by multi-family residential properties		—		—		—
Secured by non-farm, non-residential properties		—		—		—
Commercial and industrial		62		62		62
Direct consumer		25		25		3
Total loans with an allowance recorded	$	107	$	107	$	78
Total impaired loans
Loans secured by real estate
Construction, land development and other land loans	$	—	$	—	$	—
Secured by 1-4 family residential properties		952		952		13
Secured by multi-family residential properties		—		—		—
Secured by non-farm, non-residential properties		2,748		2,748		—
Commercial and industrial		62		62		62
Direct consumer		25		25		3
Total impaired loans	$	3,787	$	3,787	$	78

The above amounts include PCI loans. As of June 30, 2020, PCI loans comprised $0.2 million of impaired loans without a related allowance recorded.

As of December 31, 2019, the carrying amount of the Company’s impaired loans consisted of the following:

	December 31, 2019
	Carrying Amount		Unpaid Principal Balance		Related Allowances
	(Dollars in Thousands)
Impaired loans with no related allowance recorded
Loans secured by real estate
Construction, land development and other land loans	$	—	$	—	$	—
Secured by 1-4 family residential properties		984		984		—
Secured by multi-family residential properties		—		—		—
Secured by non-farm, non-residential properties		1,877		1,877		—
Commercial and industrial		—		—		—
Direct consumer		—		—		—
Total loans with no related allowance recorded	$	2,861	$	2,861	$	—
Impaired loans with an allowance recorded
Loans secured by real estate
Construction, land development and other land loans	$	—	$	—	$	—
Secured by 1-4 family residential properties		21		21		14
Secured by multi-family residential properties		—		—		—
Secured by non-farm, non-residential properties		—		—		—
Commercial and industrial		206		206		206
Direct consumer		29		29		7
Total loans with an allowance recorded	$	256	$	256	$	227
Total impaired loans
Loans secured by real estate	.
Construction, land development and other land loans	$	—	$	—	$	—
Secured by 1-4 family residential properties		1,005		1,005		14
Secured by multi-family residential properties		—		—		—
Secured by non-farm, non-residential properties		1,877		1,877		—
Commercial and industrial		206		206		206
Direct consumer		29		29		7
Total impaired loans	$	3,117	$	3,117	$	227

The average net investment in impaired loans and interest income recognized and received on impaired loans during the six months ended June 30, 2020 and the year ended December 31, 2019 were as follows:

	Six Months Ended June 30, 2020
	Average Recorded Investment		Interest Income Recognized		Interest Income Received
	(Dollars in Thousands)
Loans secured by real estate
Construction, land development and other land loans	$	—	$	—	$	—
Secured by 1-4 family residential properties		890		5		4
Secured by multi-family residential properties		—		—		—
Secured by non-farm, non-residential properties		2,754		14		14
Commercial and industrial		86		3		3
Direct consumer		26		1		2
Total	$	3,756	$	23	$	23

	Year Ended December 31, 2019
	Average Recorded Investment		Interest Income Recognized		Interest Income Received
	(Dollars in Thousands)
Loans secured by real estate
Construction, land development and other land loans	$	181	$	—	$	—
Secured by 1-4 family residential properties		1,021		48		48
Secured by multi-family residential properties		—		—		—
Secured by non-farm, non-residential properties		645		29		29
Commercial and industrial		991		7		7
Direct consumer		38		2		2
Total	$	2,876	$	86	$	86

Loans Modified in a Troubled Debt Restructuring

The following table provides, as of June 30, 2020 and December 31, 2019, the number of loans remaining in each loan category that the Company had previously modified in a troubled debt restructuring, as well as the pre- and post-modification principal balance as of each date.

	June 30, 2020						December 31, 2019
	Number of Loans		Pre- Modification Outstanding Principal Balance		Post- Modification Principal Balance		Number of Loans		Pre- Modification Outstanding Principal Balance		Post- Modification Principal Balance
	(Dollars in Thousands)
Loans secured by real estate:
Construction, land development and other land loans		1	$	107	$	—		1	$	107	$	62
Secured by 1-4 family residential properties		2		59		13		2		59		14
Commercial loans		2		116		55		2		116		60
Total		5	$	282	$	68		5	$	282	$	136