Document And Entity Information
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Document And Entity Information
3 Months Ended
Mar. 31, 2015
May 14, 2014
Document And Entity Information [Abstract]    
Document Type 10-Q  
Amendment Flag false  
Document Period End Date Mar. 31, 2015  
Document Fiscal Year Focus 2015  
Document Fiscal Period Focus Q1  
Entity Registrant Name NEW PEOPLES BANKSHARES INC  
Entity Central Index Key 0001163389  
Current Fiscal Year End Date --12-31  
Entity Filer Category Smaller Reporting Company  
Entity Common Stock, Shares Outstanding   22,878,654

Consolidated Statements Of Income
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Consolidated Statements Of Income (USD $)
In Thousands, except Share data, unless otherwise specified
3 Months Ended
Mar. 31, 2015
Mar. 31, 2014
INTEREST AND DIVIDEND INCOME    
Loans including fees $ 5,781 $ 6,388
Federal funds sold 1 1
Interest-earning deposits with banks 26 38
Investments 426 342
Dividends on equity securities (restricted) 32 31
Total Interest and Dividend Income 6,266 6,800
INTEREST EXPENSE    
Demand 9 9
Savings 41 49
Time deposits below $100,000 387 491
Time deposits above $100,000 271 339
FHLB Advances 40 53
Trust Preferred Securities 108 116
Total Interest Expense 856 1,057
NET INTEREST INCOME 5,410 5,743
PROVISION FOR LOAN LOSSES      
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES 5,410 5,743
NONINTEREST INCOME    
Service charges 536 504
Fees, commissions and other income 714 929
Insurance and investment fees 124 86
Net realized gains on sale of investment securities 35 3
Life insurance investment income 35 17
Total Noninterest Income 1,444 1,539
NONINTEREST EXPENSES    
Salaries and employee benefits 2,942 3,234
Occupancy and equipment expense 942 1,011
Advertising and public relations 57 117
Data processing and telecommunications 499 565
FDIC insurance premiums 218 374
Other real estate owned and repossessed vehicles, net 359 776
Other operating expenses 1,212 1,278
Total Noninterest Expenses 6,229 7,355
INCOME (LOSS) BEFORE INCOME TAXES 625 (73)
INCOME TAX EXPENSE (BENEFIT) 3 (1)
NET INCOME (LOSS) $ 622 $ (72)
Income (Loss) Per Share    
Basic $ 0.03 $ 0.00
Fully Diluted $ 0.03 $ 0.00
Average Weighted Shares of Common Stock    
Basic 22,878,654 21,872,293
Fully Diluted 22,878,654 21,872,293

Consolidated Statements Of Comprehensive Income
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Consolidated Statements Of Comprehensive Income (USD $)
In Thousands, unless otherwise specified
3 Months Ended
Mar. 31, 2015
Mar. 31, 2014
Statement Of Other Comprehensive Income [Abstract]    
NET INCOME (LOSS) $ 622 $ (72)
Investment Securities Activity    
Unrealized gains (losses) arising during the period 626 363
Tax related to unrealized gains (losses) (213) (123)
Reclassification of realized (gains) losses during the period (35) (3)
Tax related to realized (gains) losses 12 1
TOTAL OTHER COMPREHENSIVE INCOME 390 238
TOTAL COMPREHENSIVE INCOME $ 1,012 $ 166

Consolidated Balance Sheets
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Consolidated Balance Sheets (USD $)
In Thousands, unless otherwise specified
Mar. 31, 2015
Dec. 31, 2014
ASSETS    
Cash and due from banks $ 18,796 $ 14,622
Interest-bearing deposits with banks 33,317 20,933
Federal funds sold 5 5
Total Cash and Cash Equivalents 52,118 35,560
Investment securities available-for-sale 100,133 100,069
Loans receivable 449,929 457,549
Allowance for loan losses (8,960) (9,922)
Net Loans 440,969 447,627
Bank premises and equipment, net 28,570 28,766
Equity securities (restricted) 2,376 2,369
Other real estate owned 14,837 15,049
Accrued interest receivable 1,797 1,975
Life insurance investments 12,303 12,268
Deferred taxes, net 4,787 4,988
Other assets 2,240 2,413
Total Assets 660,130 651,084
Demand deposits:    
Noninterest bearing 152,814 143,950
Interest-bearing 31,129 29,567
Savings deposits 117,984 111,701
Time deposits 291,397 299,974
Total Deposits 593,324 585,192
Federal Home Loan Bank advances 3,858 4,158
Accrued interest payable 346 266
Accrued expenses and other liabilities 2,243 2,121
Trust preferred securities 16,496 16,496
Total Liabilities 616,267 608,233
Commitments and contingencies      
STOCKHOLDERS' EQUITY    
Common stock $2.00 par value; 50,000,000 shares authorized; 22,878,654 shares issued and outstanding 45,757 45,757
Common stock warrants 1,176 1,176
Additional paid-in-capital 13,672 13,672
Retained deficit (17,063) (17,685)
Accumulated other comprehensive income (loss) 321 (69)
Total Stockholders' Equity 43,863 42,851
Total Liabilities and Stockholders' Equity $ 660,130 $ 651,084

Consolidated Balance Sheets (Parenthetical)
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Consolidated Balance Sheets (Parenthetical) (USD $)
Mar. 31, 2015
Dec. 31, 2014
Consolidated Balance Sheets [Abstract]    
Common stock, par value $ 2.00 $ 2.00
Common stock, shares authorized 50,000,000 50,000,000
Common stock, shares issued 22,878,654 22,878,654
Common stock, shares outstanding 22,878,654 22,878,654

Consolidated Statements Of Changes In Stockholders' Equity
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Consolidated Statements Of Changes In Stockholders' Equity (USD $)
In Thousands, except Share data
Common Stock [Member]
Common Stock Warrants [Member]
Additional Paid-In Capital [Member]
Retained Earnings (Deficit) [Member]
Accumulated Other Comprehensive Income (Loss) [Member]
Total
Balance at Dec. 31, 2013 $ 43,745 $ 2,050 $ 13,050 $ (17,925) $ (960) $ 39,960
Balance, Shares at Dec. 31, 2013 21,872,000          
NET INCOME       (72)   (72)
Other comprehensive income, net of tax         238 238
Balance at Mar. 31, 2014 43,745 2,050 13,050 (17,997) (722) 40,126
Balance, Shares at Mar. 31, 2014 21,872,000          
Balance at Dec. 31, 2014 45,757 1,176 13,672 (17,685) (69) 42,851
Balance, Shares at Dec. 31, 2014 22,878,000         22,878,654
NET INCOME       622   622
Other comprehensive income, net of tax         390 390
Balance at Mar. 31, 2015 $ 45,757 $ 1,176 $ 13,672 $ (17,063) $ 321 $ 43,863
Balance, Shares at Mar. 31, 2015 22,878,000         22,878,654

Consolidated Statements Of Cash Flows
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Consolidated Statements Of Cash Flows (USD $)
In Thousands, unless otherwise specified
3 Months Ended
Mar. 31, 2015
Mar. 31, 2014
CASH FLOWS FROM OPERATING ACTIVITIES    
Net income $ 622 $ (72)
Adjustments to reconcile net income to net cash provided by operating activities:    
Depreciation 535 560
Provision for loan losses      
Income (less expenses) on life insurance (35) (17)
Gain on sale of securities available-for-sale (35) (3)
(Gain) loss on sale of premises and equipment   (33)
Loss on sale of foreclosed real estate 5 33
Adjustment of carrying value of foreclosed real estate 134 465
Accretion of bond premiums/discounts 270 242
Amortization of core deposit intangible   8
Net change in:    
Interest receivable 178 323
Other assets 173 (619)
Accrued interest payable 80 94
Accrued expenses and other liabilities 122 615
Net Cash Provided by Operating Activities 2,049 1,596
CASH FLOWS FROM INVESTING ACTIVITIES    
Net decrease in loans 6,336 9,131
Purchase of securities available-for-sale (10,765) (15,166)
Proceeds from sale and maturities of securities available-for-sale 11,057 13,266
Sale of Federal Home Loan Bank stock 30 247
Purchase of Federal Reserve Bank stock (37)  
Payments for the purchase of premises and equipment (339) (503)
Payments for the purchase of other real estate owned (5)  
Proceeds from sales of premises and equipment   399
Proceeds from sales of other real estate owned 400 759
Net Cash Provided by Investing Activities 6,677 8,133
CASH FLOWS FROM FINANCING ACTIVITIES    
Repayments to Federal Home Loan Bank (300) (300)
Net change in:    
Demand deposits 10,426 9,869
Savings deposits 6,283 8,583
Time deposits (8,577) (7,237)
Net Cash Used in Financing Activities 7,832 10,915
Net increase in cash and cash equivalents 16,558 20,644
Cash and Cash Equivalents, Beginning of Period 35,560 54,680
Cash and Cash Equivalents, End of Period 52,118 75,324
Supplemental Disclosure of Cash Paid During the Period for:    
Interest 776 963
Taxes      
Supplemental Disclosure of Non Cash Transactions:    
Other real estate acquired in settlement of foreclosed loans 367 620
Loans made to finance sale of foreclosed real estate $ 45 $ 359

Nature Of Operations
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Nature Of Operations
3 Months Ended
Mar. 31, 2015
Nature Of Operations [Abstract]  
Nature Of Operations

NOTE 1  NATURE OF OPERATIONS:

 

New Peoples Bankshares, Inc. (“The Company”) is a bank holding company whose principal activity is the ownership and management of a community bank.  New Peoples Bank, Inc. (“Bank”) was organized and incorporated under the laws of the Commonwealth of Virginia on December 9, 1997.  The Bank commenced operations on October 28, 1998, after receiving regulatory approval.  As a state-chartered member bank, the Bank is subject to regulation by the Virginia Bureau of Financial Institutions, the Federal Deposit Insurance Corporation and the Federal Reserve Bank.  The Bank provides general banking services to individuals, small and medium size businesses and the professional community of southwestern Virginia, southern West Virginia, and eastern Tennessee.  On June 9, 2003, the Company formed two wholly-owned subsidiaries;  NPB Financial Services, Inc. and NPB Web Services, Inc.  On July 7, 2004 the Company established NPB Capital Trust I for the purpose of issuing trust preferred securities.  On September 27, 2006, the Company established NPB Capital Trust 2 for the purpose of issuing additional trust preferred securities.  NPB Financial Services, Inc. was a subsidiary of the Company until January 1, 2009 when it became a subsidiary of the Bank.  In June 2012 the name of NPB Financial Services, Inc. was changed to NPB Insurance Services, Inc. which operates solely as an insurance agency.    


Accounting Principles
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Accounting Principles
3 Months Ended
Mar. 31, 2015
Accounting Principles [Abstract]  
Accounting Principles

NOTE 2  ACCOUNTING PRINCIPLES:

 

These consolidated financial statements conform to U. S. generally accepted accounting principles and to general industry practices.  In the opinion of management, the accompanying consolidated financial statements contain all adjustments (consisting of only normal recurring accruals) necessary to present fairly the Company’s financial position at March 31, 2015 and December 31, 2014, and the results of operations for the three-month periods ended March 31, 2015 and 2014.  The notes included herein should be read in conjunction with the notes to the consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2014.  The results of operations for the three month periods ended March 31, 2015 and 2014 are not necessarily indicative of the results to be expected for the full year.

 

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.  Actual results could differ from those estimates.  The determination of the adequacy of the allowance for loan losses and the determination of the deferred tax asset and related valuation allowance are based on estimates that are particularly susceptible to significant changes in the economic environment and market conditions.


Formal Written Agreement
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Formal Written Agreement
3 Months Ended
Mar. 31, 2015
Formal Written Agreement [Abstract]  
Formal Written Agreement

NOTE 3  FORMAL WRITTEN AGREEMENT:

Effective July 29, 2010, the Company and the Bank entered into a written agreement (the “Written Agreement”) with the Federal Reserve Bank of Richmond (“Reserve Bank”) and the Virginia State Corporation Commission Bureau of Financial Institutions (the “Bureau”).  At March 31, 2015, we believe we have not yet achieved full compliance with the Written Agreement but we have made progress in our compliance efforts under the Written Agreement and all of the written plans required to date, as discussed in the following paragraphs, have been submitted on a timely basis. 

 

Under the terms of the Written Agreement, the Bank agreed to develop and submit for approval within specified  time periods written plans to: (a) strengthen board oversight of management and the Bank’s operation; (b) if appropriate after review, to strengthen the Bank’s management and board governance; (c) strengthen credit risk management policies; (d) enhance lending and credit administration; (e) enhance the Bank’s management of commercial real estate concentrations; (f) conduct ongoing review and grading of the Bank’s loan portfolio; (g) improve the Bank’s position with respect to loans, relationships, or other assets in excess of $1 million which are now or in the future become past due more than 90 days, which are on the Bank’s problem loan list, or which are adversely classified in any report of examination of the Bank; (h) review and revise, as appropriate, current policy and maintain sound processes for maintaining an adequate allowance for loan and lease losses; (i) enhance management of the Bank’s liquidity position and funds management practices; (j) revise its contingency funding plan; (k)  revise its strategic plan; and (l)  enhance the Bank’s anti-money laundering and related activities. 

In addition, the Bank agreed that it will: (a) not extend, renew, or restructure any credit that has been criticized by the Reserve Bank or the Bureau absent prior board of directors approval in accordance with the restrictions in the Written Agreement; (b) eliminate all assets or portions of assets classified as “loss” and thereafter charge off all assets classified as “loss” in a federal or state report of examination, unless otherwise approved by the Reserve Bank.

Under the terms of the Written Agreement, both the Company and the Bank agreed to submit capital plans to maintain sufficient capital at the Company, on a consolidated basis, and the Bank, on a stand-alone basis, and to refrain from declaring or paying dividends without prior regulatory approval. The Company agreed that it will not take any other form of payment representing a reduction in the Bank’s capital or make any distributions of interest, principal, or other sums on subordinated debentures or trust preferred securities without prior regulatory approval. The Company may not incur, increase or guarantee any debt without prior regulatory approval and has agreed not to purchase or redeem any shares of its stock without prior regulatory approval.

 

Under the terms of the Written Agreement, the Company and the Bank appointed a committee to monitor compliance with the Written Agreement. The directors of the Company and the Bank recognized and unanimously agree with the common goal of financial soundness represented by the Written Agreement and have confirmed the intent of the directors and executive management to diligently seek to comply with all requirements of the Written Agreement.


Capital
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Capital
3 Months Ended
Mar. 31, 2015
Capital [Abstract]  
Capital

NOTE 4  CAPITAL:

 

Capital Requirements and Ratios

 

The Company and the Bank are subject to various capital requirements administered by federal banking agencies.  Failure to meet minimum capital requirements can initiate certain mandatory and, possibly, additional discretionary actions by regulators that, if undertaken, could have a direct material effect on the Company’s and the Bank’s financial statements.  Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Company and the Bank must meet specific capital guidelines that involve quantitative measures of assets, liabilities, and certain off-balance sheet items as calculated under regulatory accounting practices.  The capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk weightings, and other factors.  Prompt corrective action provisions are not applicable to bank holding companies.

 

Quantitative measures established by regulation to ensure capital adequacy require the Company and the Bank to maintain minimum amounts and ratios (set forth in the following table) of total and Tier 1 capital (as defined) to risk-weighted assets (as defined), Tier 1 capital (as defined) to average assets (as defined), and Common Equity Tier 1 capital (as defined) to risk-weighted assets (as defined).  Management believes that, as of March 31, 2015, the Company and the Bank meet all capital adequacy requirements to which they are subject.    The Company’s and the Bank’s actual capital amounts and ratios are presented in the following table as of March 31, 2015 and December 31, 2014, respectively.  The March 31, 2015 ratios comply with Federal Reserve rules to align with the Basel III Capital requirements effective January 1, 2015.

 

 

 

 

 

 

 

 

 

 

 

 

Actual

Minimum Capital Requirement

Minimum to Be Well Capitalized Under Prompt Corrective Action Provisions

(Dollars are in thousands)

Amount

Ratio

Amount

Ratio

 

Amount

Ratio

March 31, 2015:

Total Capital to Risk Weighted Assets:

The Company

$

63,974 
16.61% 

$  30,804

8.0% 

$

N/A

N/A

The Bank

 

63,348 
16.44% 
30,831 
8.0% 

 

38,538 
10.0% 

Tier 1 Capital to Risk Weighted Assets:

The Company

 

57,623 
14.97% 
23,103 
6.0% 

 

N/A

N/A

The Bank

 

58,480 
15.17% 
23,123 
6.0% 

 

30,831 
8.0% 

Tier 1 Capital to Average Assets:

The Company

 

57,623 
8.75% 
26,342 
4.0% 

 

N/A

N/A

The Bank

 

58,480 
8.88% 
26,350 
4.0% 

 

32,937 
5.0% 

Common Equity Tier 1 Capital

     to Risk Weighted Assets:

The Company

 

43,109 
11.20% 
17,327 
4.5% 

 

N/A

N/A

The Bank

 

58,480 
15.17% 
17,342 
4.5% 

 

25,050 
6.5% 

 

 

December 31, 2014:

Total Capital to Risk Weighted Assets:

The Company

$

59,816 
15.98% 
$
29,948 
8.0% 

$

N/A

N/A

The Bank

 

58,869 
15.73% 
29,938 
8.0% 

 

37,422 
10.0% 

Tier 1 Capital to Risk Weighted Assets:

The Company

 

53,379 
14.26% 
14,974 
4.0% 

 

N/A

N/A

The Bank

 

54,127 
14.46% 
14,969 
4.0% 

 

22,453 
6.0% 

Tier 1 Capital to Average Assets:

The Company

 

53,379 
8.07% 
26,453 
4.0% 

 

N/A

N/A

The Bank

 

54,127 
8.19% 
26,447 
4.0% 

 

33,058 
5.0% 

 

As of March 31, 2015, the Bank was well capitalized under the regulatory framework for prompt corrective action.  To be categorized as well capitalized, an institution must maintain minimum total risk-based, Tier 1 risk-based, Tier 1 leverage, and Common Equity Tier 1 ratios as set forth in the above tables.  There are no conditions or events since the notification that management believes have changed the Company’s and Bank’s category.    

 


Investment Securities
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Investment Securities
3 Months Ended
Mar. 31, 2015
Investment Securities [Abstract]  
Investment Securities

NOTE 5  INVESTMENT SECURITIES:

 

The amortized cost and estimated fair value of securities (all available-for-sale (“AFS”)) are as follows:

 

 

 

 

 

 

 

 

 

 

 

Gross

 

Gross

 

Approximate

 

Amortized

 

Unrealized

 

Unrealized

 

Fair

(Dollars are in thousands)

Cost

 

Gains

 

Losses

 

Value

March 31, 2015

U.S. Government Agencies

$

43,732 

$

375 

$

141 

$

43,966 

Taxable municipals

290 

-

288 

Corporate bonds

940 

-

934 

Mortgage backed securities

54,685 
378 
118 
54,945 

Total Securities AFS

$

99,647 

$

753 

$

267 

$

100,133 

 

December 31, 2014

U.S. Government Agencies

$

43,985 

$

332 

$

247 

$

44,070 

Taxable municipals

293 

-

288 

Corporate bonds

-

-

-

-

Mortgage backed securities

55,896 
144 
329 
55,711 

Total Securities AFS

$

100,174 

$

476 

$

581 

$

100,069 

 

The following table details unrealized losses and related fair values in the available-for-sale portfolio.  This information is aggregated by the length of time that individual securities have been in a continuous unrealized loss position as of March 31, 2015 and December 31, 2014.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Less than 12 Months

 

12 Months or More

 

Total

 

 

(Dollars are in thousands)

 

Fair Value

 

Unrealized

Losses

 

Fair

Value

 

Unrealized

Losses

 

Fair

Value

 

Unrealized

Losses

 

March 31, 2015

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Government Agencies

$

5,907 

$

35 

$

8,335 

$

106 

$

14,242 

$

141 

 

Taxable municipals

 

288 

 

 

-

 

-

 

288 

 

 

Corporate bonds

 

934 

 

 

-

 

-

 

934 

 

 

Mtg. backed securities

 

8,335 

 

44 

 

8,124 

 

74 

 

16,459 

 

118 

 

Total Securities AFS

$

15,464 

$

87 

$

16,459 

$

180 

$

31,923 

$

267 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

December 31, 2014

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Government Agencies

$

7,408 

$

38 

$

12,965 

$

209 

$

20,373 

$

247 

 

Taxable municipals

 

288 

 

 

-

 

-

 

288 

 

 

Mtg. backed securities

 

21,083 

 

179 

 

11,622 

 

150 

 

32,705 

 

329 

 

Total Securities AFS

$

28,779 

$

222 

$

24,587 

$

359 

$

53,366 

$

581 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

At March 31, 2015, the available-for-sale portfolio included fifty-two investments for which the fair market value was less than amortized cost.  At December 31, 2014, the available-for-sale portfolio included eighty four investments for which the fair market value was less than amortized cost.  Management evaluates securities for other-than-temporary impairment at least on a quarterly basis, and more frequently when economic or market concerns warrant such evaluation.  Consideration is given to (1) the length of time and the extent to which the fair value has been less than cost, (2) the financial conditions and near-term prospects of the issuer, and (3) the intent and ability of the Company to retain its investment in the issuer for a period of time sufficient to allow for any anticipated recovery in fair value.  Based on the Company’s analysis, the Company concluded that no securities had an other-than-temporary impairment.

 

The amortized cost and fair value of investment securities at March 31, 2015, by contractual maturity, are shown in the following schedule.  Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.

 

 

 

 

 

 

 

 

Weighted

(Dollars are in thousands)

Amortized

 

Fair

 

Average

Securities Available-for-Sale

Cost

 

Value

 

Yield

Due in one year or less

$

178 

$

178 

 

1.51% 

Due after one year through five years

2,608 
2,632 
1.40% 

Due after five years through fifteen years

 

12,515 

 

12,567 

 

1.36% 

Due after fifteen years

 

84,346 

 

84,756 

 

1.92% 

Total

$

99,647 

$

100,133 

 

1.84% 

Investment securities with a carrying value of $16.1 million and $17.5 million at March 31, 2015 and December 31, 2014, were pledged as collateral to secure public deposits, overnight payment processing and for other purposes required by law.

 

The Bank, as a member of the Federal Reserve Bank and the Federal Home Loan Bank, is required to hold stock in each. These equity securities are restricted from trading and are recorded at a cost of $2.4 million and $2.4 million as of March 31, 2015 and December 31, 2014, respectively.


Loans
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Loans
3 Months Ended
Mar. 31, 2015
Loans [Abstract]  
Loans

NOTE 6  LOANS:

 

Loans receivable outstanding are summarized as follows:

 

 

 

 

 

 

(Dollars are in thousands)

 

March 31, 2015

 

December 31, 2014

Real estate secured:

 

 

 

 

Commercial

$

106,512 

$

108,062 

Construction and land development

 

14,285 

 

15,439 

Residential 1-4 family

 

241,563 

 

243,538 

Multifamily

 

13,908 

 

14,409 

Farmland

 

24,594 

 

25,252 

Total real estate loans

 

400,862 

 

406,700 

Commercial

 

20,524 

 

21,807 

Agriculture

 

3,023 

 

3,117 

Consumer installment loans

 

25,434 

 

25,828 

All other loans

 

86 

 

97 

Total loans

$

449,929 

$

457,549 

 

Loans receivable on nonaccrual status are summarized as follows:

 

 

 

 

 

 

 

 

 

 

 

(Dollars are in thousands)

 

March 31, 2015

 

December 31, 2014

Real estate secured:

 

 

 

 

Commercial

$

5,449 

$

6,222 

Construction and land development

 

564 

 

332 

Residential 1-4 family

 

7,617 

 

8,589 

Multifamily

 

902 

 

118 

Farmland

 

5,575 

 

5,982 

Total real estate loans

 

20,107 

 

21,243 

Commercial

 

577 

 

554 

Agriculture

 

15 

 

18 

Consumer installment loans

 

23 

 

46 

All other loans

 

-

 

-

Total loans receivable on nonaccrual status

$

20,722 

$

21,861 

 

Total interest income not recognized on nonaccrual loans for the three months ended March 31, 2015 and 2014 was $166 thousand and $254 thousand, respectively.

 

 

 

The following table presents information concerning the Company’s investment in loans considered impaired as of March 31, 2015 and December 31, 2014:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

As of March 31, 2015

(Dollars are in thousands)

 

 

Average

Recorded

Investment

 

 

Interest

Income

Recognized

 

 

 

Recorded

Investment

 

 

 

 

Unpaid Principal Balance

 

 

 

Related

Allowance

With no related allowance recorded:

 

 

 

 

 

 

 

 

 

 

Real estate secured:

 

 

 

 

 

 

 

 

 

 

Commercial

$

4,314 

$

24 

$

4,642 

$

6,101 

$

-

Construction and land development

 

15 

 

-

 

14 

 

14 

 

-

Residential 1-4 family

 

3,573 

 

45 

 

3,900 

 

4,060 

 

-

Multifamily

 

652 

 

(2)

 

866 

 

1,252 

 

-

Farmland

 

5,730 

 

17 

 

5,692 

 

6,772 

 

-

Commercial

 

562 

 

 

575 

 

705 

 

-

Agriculture

 

52 

 

 

52 

 

52 

 

-

Consumer installment loans

 

14 

 

-

 

12 

 

12 

 

-

All other loans

 

-

 

-

 

-

 

-

 

-

With an allowance recorded:

 

 

 

 

 

 

 

 

 

 

Real estate secured:

 

 

 

 

 

 

 

 

 

 

Commercial

 

3,676 

 

22 

 

2,834 

 

3,050 

 

943 

Construction and land development

 

381 

 

-

 

458 

 

701 

 

242 

Residential 1-4 family

 

2,426 

 

28 

 

2,278 

 

2,488 

 

275 

Multifamily

 

57 

 

-

 

-

 

-

 

-

Farmland

 

1,103 

 

13 

 

1,102 

 

1,114 

 

341 

Commercial

 

84 

 

 

93 

 

93 

 

45 

Agriculture

 

29 

 

-

 

27 

 

27 

 

27 

Consumer installment loans

 

26 

 

 

52 

 

52 

 

All other loans

 

-

 

-

 

-

 

-

 

-

Total

$

22,694 

$

151 

$

22,597 

$

26,493 

$

1,875 

 

 

As of December 31, 2014

(Dollars are in thousands)

 

 

Average

Recorded

Investment

 

 

Interest

Income

Recognized

 

 

 

Recorded

Investment

 

 

Unpaid Principal Balance

 

 

 

Related

Allowance

With no related allowance recorded:

 

 

 

 

 

 

 

 

 

 

Real estate secured:

 

 

 

 

 

 

 

 

 

 

Commercial

$

9,628 

$

128 

$

3,986 

$

5,166 

$

-

Construction and land development

 

248 

 

 

15 

 

15 

 

-

Residential 1-4 family

 

2,959 

 

177 

 

3,245 

 

3,471 

 

-

Multifamily

 

370 

 

26 

 

438 

 

479 

 

-

Farmland

 

5,383 

 

114 

 

5,767 

 

6,801 

 

-

Commercial

 

421 

 

-

 

548 

 

674 

 

-

Agriculture

 

62 

 

 

52 

 

52 

 

-

Consumer installment loans

 

12 

 

 

15 

 

15 

 

-

All other loans

 

-

 

-

 

-

 

-

 

-

With an allowance recorded:

 

 

 

 

 

 

 

 

 

 

Real estate secured:

 

 

 

 

 

 

 

 

 

 

Commercial

 

6,338 

 

132 

 

4,517 

 

4,905 

 

1,482 

Construction and land development

 

505 

 

14 

 

303 

 

355 

 

88 

Residential 1-4 family

 

4,248 

 

126 

 

2,573 

 

2,852 

 

347 

Multifamily

 

268 

 

 

113 

 

113 

 

15 

Farmland

 

2,573 

 

59 

 

1,104 

 

1,116 

 

343 

Commercial

 

407 

 

 

74 

 

74 

 

26 

Agriculture

 

39 

 

 

30 

 

30 

 

30 

Consumer installment loans

 

10 

 

-

 

-

 

-

 

-

All other loans

 

-

 

-

 

-

 

-

 

-

Total

$

33,471 

$

795 

$

22,780 

$

26,118 

$

2,331 

 

 

An age analysis of past due loans receivable was as follows:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

As of March 31, 2015

(Dollars are in thousands)

 

 

 

Loans

30-59

Days

Past

Due

 

 

 

Loans

60-89

Days

Past

Due

 

 

Loans

90 or

More

Days

Past

Due

 

 

 

 

Total

Past

Due

Loans

 

 

 

 

 

 

Current

Loans

 

 

 

 

 

 

Total

Loans

 

Accruing

Loans

90 or

More

Days

Past

Due

Real estate secured:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial

$

2,027 

$

256 

$

3,320 

$

5,603 

$

100,909 

$

106,512 

$

-

Construction and  land

  development

 

134 

 

-

 

-

 

134 

 

14,151 

 

14,285 

 

-

Residential 1-4 family

 

6,055 

 

1,604 

 

2,344 

 

10,003 

 

231,560 

 

241,563 

 

-

Multifamily

 

-

 

428 

 

359 

 

787 

 

13,121 

 

13,908 

 

-

Farmland

 

599 

 

29 

 

1,600 

 

2,228 

 

22,366 

 

24,594 

 

-

Total real estate loans

 

8,815 

 

2,317 

 

7,623 

 

18,755 

 

382,107 

 

400,862 

 

-

Commercial

 

19 

 

100 

 

217 

 

336 

 

20,188 

 

20,524 

 

-

Agriculture

 

12 

 

-

 

-

 

12 

 

3,011 

 

3,023 

 

-

Consumer installment

  Loans

 

75 

 

64 

 

15 

 

154 

 

25,280 

 

25,434 

 

-

All other loans

 

 

-

 

-

 

 

79 

 

86 

 

-

Total loans

$

8,928 

$

2,481 

$

7,855 

$

19,264 

$

430,665 

$

449,929 

$

-

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

As of December 31, 2014

(Dollars are in thousands)

 

 

 

Loans

30-59

Days

Past

Due

 

 

 

Loans

60-89

Days

Past

Due

 

 

Loans

90 or

More

Days

Past

Due

 

 

 

 

Total

Past

Due

Loans

 

 

 

 

 

 

Current

Loans

 

 

 

 

 

 

Total

Loans

 

Accruing

Loans

90 or

More

Days

Past

Due

Real estate secured:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial

$

2,683 

$

74 

$

2,411 

$

5,168 

$

102,894 

$

108,062 

$

-

Construction and  land

  development

 

94 

 

335 

 

12 

 

441 

 

14,998 

 

15,439 

 

-

Residential 1-4 family

 

7,885 

 

1,728 

 

2,346 

 

11,959 

 

231,579 

 

243,538 

 

-

Multifamily

 

320 

 

-

 

-

 

320 

 

14,089 

 

14,409 

 

-

Farmland

 

661 

 

453 

 

-

 

1,114 

 

24,138 

 

25,252 

 

-

Total real estate loans

 

11,643 

 

2,590 

 

4,769 

 

19,002 

 

387,698 

 

406,700 

 

-

Commercial

 

64 

 

15 

 

162 

 

241 

 

21,566 

 

21,807 

 

-

Agriculture

 

-

 

 

-

 

 

3,113 

 

3,117 

 

-

Consumer installment

  Loans

 

153 

 

19 

 

21 

 

193 

 

25,635 

 

25,828 

 

-

All other loans

 

22 

 

 

-

 

28 

 

69 

 

97 

 

-

Total loans

$

11,882 

$

2,634 

$

4,952 

$

19,468 

$

438,081 

$

457,549 

$

-

 

The Company categorizes loans receivable into risk categories based on relevant information about the ability of borrowers to service their debt such as: current financial information, historical payment experience, credit documentation, public information, and current economic trends, among other factors. The Company analyzes loans individually by classifying the loans receivable as to credit risk.  The Company uses the following definitions for risk ratings:

 

Pass - Loans in this category are considered to have a low likelihood of loss based on relevant information analyzed about the ability of the borrowers to service their debt and other factors.

 

Special Mention - Loans in this category are currently protected but are potentially weak, including adverse trends in borrower’s operations, credit quality or financial strength.  Those loans constitute an undue and unwarranted credit risk but not to the point of justifying a substandard classification. The credit risk may be relatively minor yet constitute an unwarranted risk in light of the circumstances.  Special mention loans have potential weaknesses which may, if not checked or corrected, weaken the loan or inadequately protect the Company’s credit position at some future date.

 

Substandard - A substandard loan is inadequately protected by the current sound net worth and paying capacity of the obligor or of the collateral pledged, if any.  Loans classified as substandard must have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt; they are characterized by the distinct possibility that the institution will sustain some loss if the deficiencies are not corrected.

 

Doubtful - Loans classified Doubtful have all the weaknesses inherent in loans classified as Substandard, plus the added characteristic that the weaknesses make collection or liquidation in full on the basis of currently existing facts, conditions, and values highly questionable and improbable.

 

Based on the most recent analysis performed, the risk category of loans receivable was as follows:

 

 

 

 

 

 

 

 

 

 

 

 

As of March 31, 2015

(Dollars are in thousands)

 

 

 

Pass

 

 

Special

Mention

 

 

 

Substandard

 

 

 

 

 

Doubtful

 

 

 

Total

Real estate secured:

 

 

 

 

 

 

 

 

 

 

  Commercial

$

92,133 

$

7,933 

$

6,446 

$

-

$

106,512 

  Construction and land development

 

11,526 

 

2,195 

 

564 

 

-

 

14,285 

  Residential 1-4 family

 

228,599 

 

2,790 

 

10,174 

 

-

 

241,563 

  Multifamily

 

12,782 

 

145 

 

981 

 

-

 

13,908 

  Farmland

 

17,562 

 

270 

 

6,762 

 

-

 

24,594 

Total real estate loans

 

362,602 

 

13,333 

 

24,927 

 

-

 

400,862 

Commercial

 

17,391 

 

2,334 

 

799 

 

-

 

20,524 

Agriculture

 

2,981 

 

-

 

42 

 

-

 

3,023 

Consumer installment loans

 

25,350 

 

-

 

84 

 

-

 

25,434 

All other loans

 

86 

 

-

 

-

 

-

 

86 

Total

$

408,410 

$

15,667 

$

25,852 

$

-

$

449,929 

 

As of December 31, 2014

(Dollars are in thousands)

 

 

 

Pass

 

 

Special

Mention

 

 

 

Substandard

 

 

 

 

 

Doubtful

 

 

 

Total

Real estate secured:

 

 

 

 

 

 

 

 

 

 

  Commercial

$

92,515 

$

7,925 

$

7,622 

$

-

$

108,062 

  Construction and land development

 

12,974 

 

2,041