XML 39 R29.htm IDEA: XBRL DOCUMENT

Loans and Allowance for Loan Losses (Tables)

9 Months Ended

Sep. 30, 2020

Allowance For Loan And Lease Losses Writeoffs Net [Abstract]

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

	September 30, 2020
	Bank			ALC		Total
	(Dollars in Thousands)
Real estate loans:
Construction, land development and other land loans	$	35,472		$	—	$	35,472
Secured by 1-4 family residential properties		91,208			3,939		95,147
Secured by multi-family residential properties		49,197			—		49,197
Secured by non-farm, non-residential properties		183,754			—		183,754
Commercial and industrial loans ⁽¹⁾		86,898			—		86,898
Consumer loans:
Direct consumer		7,277			22,771		30,048
Branch retail		—			33,145		33,145
Indirect sales ⁽²⁾		125,369			—		125,369
Total loans		579,175			59,855		639,030
Less: Unearned interest, fees and deferred cost		(77	)		4,317		4,240
Allowance for loan losses		5,550			1,635		7,185
Net loans	$	573,702		$	53,903	$	627,605

	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 September 30, 2020 and December 31, 2019:

	September 30, 2020			December 31, 2019
	(Dollars in Thousands)
Real estate loans:
Secured by 1-4 family residential properties	$	197		$	224
Outstanding balance		197			224
Fair value adjustment		(32	)		(49	)
Carrying amount, net of fair value adjustment	$	165		$	175

Allowance for Loan Losses

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

	As of and for the Nine Months Ended September 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		—		(52	)		—		—		—			(1,347	)		(279	)		(103	)		(1,781	)
Recoveries		—		17			—		11		—			554			134			12			728
Provision		143		234			96		610		(475	)		405			175			1,288			2,476
Ending balance	$	340	$	665		$	518	$	1,585	$	902		$	1,237		$	425		$	1,513		$	7,185
Ending balance of allowance attributable to loans:
Individually evaluated for impairment	$	—	$	13		$	—	$	—	$	61		$	2		$	—		$	—		$	76
Collectively evaluated for impairment		340		652			518		1,585		841			1,235			425			1,513			7,109
Total allowance for loan losses	$	340	$	665		$	518	$	1,585	$	902		$	1,237		$	425		$	1,513		$	7,185
Ending balance of loans receivable:
Individually evaluated for impairment	$	—	$	757		$	—	$	2,644	$	61		$	25		$	—		$	—		$	3,487
Collectively evaluated for impairment		35,472		94,225			49,197		181,110		86,837			30,023			33,145			125,369			635,378
Loans acquired with deteriorated credit quality		—		165			—		—		—			—			—			—			165
Total loans receivable	$	35,472	$	95,147		$	49,197	$	183,754	$	86,898		$	30,048		$	33,145		$	125,369		$	639,030

	As of and for the Nine Months Ended September 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		—			(81	)		—		—		—		(1,533	)		(294	)		(194	)		(2,102	)
Recoveries		—			28			—		—		3		503			94			6			634
Provision		(78	)		168			233		72		259		872			204			268			1,998
Ending balance	$	163		$	461		$	361	$	903	$	1,400	$	1,641		$	431		$	225		$	5,585
Ending balance of allowance attributable to loans:
Individually evaluated for impairment	$	—		$	15		$	—	$	—	$	394	$	9		$	—		$	—		$	418
Collectively evaluated for impairment		163			446			361		903		1,006		1,632			431			225			5,167
Total allowance for loan losses	$	163		$	461		$	361	$	903	$	1,400	$	1,641		$	431		$	225		$	5,585
Ending balance of loans receivable:
Individually evaluated for impairment	$	—		$	839		$	—	$	496	$	4,025	$	32		$	—		$	—		$	5,392
Collectively evaluated for impairment		28,190			108,317			46,843		164,445		86,445		37,445			30,008			48,073			549,766
Loans acquired with deteriorated credit quality		—			180			—		—		—		—			—			—			180
Total loans receivable	$	28,190		$	109,336		$	46,843	$	164,941	$	90,470	$	37,477		$	30,008		$	48,073		$	555,338

Loans By Credit Quality Indicators

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

	September 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	$	33,133		$	2,334		$	5		$	35,472
Secured by multi-family residential properties		49,197			—			—			49,197
Secured by non-farm, non-residential properties		171,774			10,196			1,784			183,754
Commercial and industrial loans		84,818			1,638			442			86,898
Total	$	338,922		$	14,168		$	2,231		$	355,321
As a percentage of total loans		95.38	%		3.99	%		0.63	%		100.00	%

	September 30, 2020
	Performing			Nonperforming			Total
	(Dollars in Thousands)
Loans secured by real estate:
Secured by 1-4 family residential properties	$	93,150		$	1,997		$	95,147
Consumer loans:
Direct consumer		29,850			198			30,048
Branch retail		32,992			153			33,145
Indirect sales		125,369			—			125,369
Total	$	281,361		$	2,348		$	283,709
As a percentage of total loans		99.17	%		0.83	%		100.00	%

The above amounts include PCI loans. As of September 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 September 30, 2020:

	As of September 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	$	—		$	—		$	—		$	—		$	35,472		$	35,472		$	—
Secured by 1-4 family residential properties		256			86			4			346			94,801			95,147			—
Secured by multi-family residential properties		—			—			—			—			49,197			49,197			—
Secured by non-farm, non-residential properties		429			—			1,337			1,766			181,988			183,754			—
Commercial and industrial loans		62			—			—			62			86,836			86,898			—
Consumer loans:
Direct consumer		289			182			167			638			29,410			30,048			—
Branch retail		133			45			153			331			32,814			33,145			—
Indirect sales		96			—			—			96			125,273			125,369			—
Total	$	1,265		$	313		$	1,661		$	3,239		$	635,791		$	639,030		$	—
As a percentage of total loans		0.20	%		0.05	%		0.26	%		0.51	%		99.49	%		100.00	%

The above amounts include PCI loans. As of September 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 September 30, 2020 and December 31, 2019:

	Loans on Non-Accrual Status
	September 30, 2020		December 31, 2019
	(Dollars in Thousands)
Loans secured by real estate:
Construction, land development and other land loans	$	12	$	8
Secured by 1-4 family residential properties		1,275		1,423
Secured by multi-family residential properties		—		—
Secured by non-farm, non-residential properties		1,341		1,426
Commercial and industrial loans		99		27
Consumer loans:
Direct consumer		174		558
Branch retail		152		281
Indirect sales		—		—
Total loans	$	3,053	$	3,723

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

The table below summarizes all remaining COVID-19 payment deferments as of September 30, 2020 and June 30, 2020.

	As of September 30, 2020							As of June 30, 2020
	Number of Loans Deferred		Principal Balance of Loans Deferred		% of Portfolio Balance			Number of Loans Deferred		Principal Balance of Loans Deferred		% of Portfolio Balance
	(Dollars in Thousands)
Loans secured by real estate:
Construction, land development and other land loans		1	$	2,259		6.4	%		7	$	4,544		14.5	%
Secured by 1-4 family residential properties		8		398		0.4	%		50		9,474		10.2	%
Secured by multi-family residential properties		—		—		—			12		29,726		60.9	%
Secured by non-farm, non-residential properties		10		14,084		7.7	%		49		42,797		26.6	%
Commercial and industrial loans		2		529		0.6	%		9		1,460		1.7	%
Consumer loans:
Direct consumer		77		284		0.9	%		442		2,188		6.6	%
Branch retail		36		353		1.1	%		172		1,856		5.6	%
Indirect sales		19		509		0.4	%		123		3,199		3.6	%
Total loans		153	$	18,416		2.9	%		864	$	95,244		16.5	%

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

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

	September 30, 2020					June 30, 2020
	Balance of Risk Category		% of Total Loan Balance			Balance of Risk Category		% of Total Loan Balance
	(Dollars in Thousands)					(Dollars in Thousands)
High-risk loan categories:
Hotels/motels	$	10,459		1.6	%	$	10,410		1.8	%
Dine-in restaurants		4,379		0.7	%		4,459		0.8	%
Total high-risk loans	$	14,838		2.3	%	$	14,869		2.6	%

Impaired Loans

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

	September 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		903		903		—
Secured by multi-family residential properties		—		—		—
Secured by non-farm, non-residential properties		2,644		2,644		—
Commercial and industrial		—		—		—
Direct consumer		—		—		—
Total loans with no related allowance recorded	$	3,547	$	3,547	$	—
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		19		19		13
Secured by multi-family residential properties		—		—		—
Secured by non-farm, non-residential properties		—		—		—
Commercial and industrial		61		61		61
Direct consumer		25		25		2
Total loans with an allowance recorded	$	105	$	105	$	76
Total impaired loans
Loans secured by real estate
Construction, land development and other land loans	$	—	$	—	$	—
Secured by 1-4 family residential properties		922		922		13
Secured by multi-family residential properties		—		—		—
Secured by non-farm, non-residential properties		2,644		2,644		—
Commercial and industrial		61		61		61
Direct consumer		25		25		2
Total impaired loans	$	3,652	$	3,652	$	76

The above amounts include PCI loans. As of September 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 nine months ended September 30, 2020 and the year ended December 31, 2019 were as follows:

	Nine Months Ended September 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		917		7		7
Secured by multi-family residential properties		—		—		—
Secured by non-farm, non-residential properties		2,722		21		21
Commercial and industrial		78		5		5
Direct consumer		26		1		2
Total	$	3,743	$	34	$	35

	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 September 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.

	September 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		12		2		59		14
Commercial loans		2		116		51		2		116		60
Total		5	$	282	$	63		5	$	282	$	136