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Table of Contents

 

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

(Mark One)

 

x      Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

 

for the quarterly period ended March 31, 2011

 

o         Transition report pursuant to Section 13 or 15(d) of the Exchange Act

 

for the transition period from          to         

 

Commission File No. 000-28344

 

FIRST COMMUNITY CORPORATION

(Exact name of registrant as specified in its charter)

 

South Carolina

 

57-1010751

(State of Incorporation)

 

(I.R.S. Employer Identification)

 

5455 Sunset Boulevard, Lexington, South Carolina 29072

(Address of Principal Executive Offices)

 

(803) 951-2265

(Registrant’s Telephone Number, Including Area Code)

 

 

(Former Name, Former Address and Former Fiscal Year, if Changed Since Last Report)

 

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  Yes x No o

 

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).  o Yes o No

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.  See the definitions of “large accelerated filer,” “accelerated filer,” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer o

 

Accelerated filer o

 

 

 

Non-accelerated filer o

 

Smaller reporting company x

 

Indicate by check mark whether the registrant is shell company (as defined in Rule 12b-2 of the Exchange Act).  Yes o No x

 

Indicate the number of shares outstanding of each of the issuer’s classes of common equity, as of the latest practicable date:  On May 13, 2011, 3,273,533 shares of the issuer’s common stock, par value $1.00 per share, were issued and outstanding.

 

 

 



Table of Contents

 

TABLE OF CONTENTS

 

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements.

Consolidated Balance Sheets

Consolidated Statements of Income

Consolidated Statements of Changes in Shareholders’ Equity and Comprehensive Income (Loss)

Consolidated Statements of Cash Flows

Notes to Consolidated Financial Statements

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Item 4. Controls and Procedures

 

PART II — OTHER INFORMATION

Item 1. Legal Proceedings

Item 1A. Risk Factors

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Item 3. Defaults Upon Senior Securities

Item 4. (Removed and Reserved)

Item 5. Other Information

Item 6. Exhibits

 

INDEX TO EXHIBITS

SIGNATURES

EX-31.1 RULE 13A-14(A) CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER

EX-31.2 RULE 13A-14(A) CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER

EX-32 SECTION 1350 CERTIFICATIONS

 



Table of Contents

 

PART I

FINANCIAL INFORMATION

Item 1.  Financial Statements

 

3



Table of Contents

 

FIRST COMMUNITY CORPORATION

CONSOLIDATED BALANCE SHEETS

 

(Dollars in thousands, except par value)

 

March 31, 2011
(Unaudited)

 

December 31, 2010

 

ASSETS

 

 

 

 

 

Cash and due from banks

 

$

8,724

 

$

7,114

 

Interest-bearing bank balances

 

18,856

 

19,102

 

Federal funds sold and securities purchased under agreements to resell

 

1,540

 

245

 

Investment securities - available for sale

 

191,033

 

189,309

 

Other investments, at cost

 

6,789

 

6,841

 

Loans

 

334,156

 

329,954

 

Less, allowance for loan losses

 

4,655

 

4,911

 

Net loans

 

329,501

 

325,043

 

Property, furniture and equipment - net

 

17,867

 

18,026

 

Bank owned life insurance

 

10,806

 

10,773

 

Other real estate owned

 

7,901

 

6,904

 

Intangible assets

 

726

 

881

 

Other assets

 

13,571

 

14,785

 

Total assets

 

$

607,314

 

$

599,023

 

LIABILITIES

 

 

 

 

 

Deposits:

 

 

 

 

 

Non-interest bearing demand

 

$

84,928

 

$

72,625

 

NOW and money market accounts

 

128,818

 

123,604

 

Savings

 

30,889

 

29,886

 

Time deposits less than $100,000

 

154,551

 

143,946

 

Time deposits $100,000 and over

 

66,797

 

85,283

 

Total deposits

 

465,983

 

455,344

 

Securities sold under agreements to repurchase

 

14,342

 

12,686

 

Federal Home Loan Bank advances

 

64,840

 

68,094

 

Junior subordinated debt

 

15,464

 

15,464

 

Other borrowed money

 

100

 

120

 

Other liabilities

 

4,070

 

5,518

 

Total liabilities

 

564,799

 

557,226

 

SHAREHOLDERS’ EQUITY

 

 

 

 

 

Preferred stock, par value $1.00 per share, 10,000,000 shares authorized; 11,350 issued and outstanding

 

11,060

 

11,035

 

Common stock, par value $1.00 per share; 10,000,000 shares authorized; issued and outstanding 3,273,533 at March 31, 2011 and 3,270,135 at December 31, 2010

 

3,274

 

3,270

 

Common stock warrants issued

 

509

 

509

 

Additional paid in capital

 

48,974

 

48,956

 

Retained earnings (deficit)

 

(19,460

)

(19,732

)

Accumulated other comprehensive income (loss)

 

(1,842

)

(2,241

)

Total shareholders’ equity

 

42,515

 

41,797

 

Total liabilities and shareholders’ equity

 

$

607,314

 

$

599,023

 

 

See Notes to Consolidated Financial Statements

 

4



Table of Contents

 

FIRST COMMUNITY CORPORATION

CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)

 

 

 

Three Months ended March 31,

 

(Dollars in thousands, except per share amounts)

 

2011

 

2010

 

Interest and dividend income:

 

 

 

 

 

Loans, including fees

 

$

4,808

 

$

5,050

 

Taxable securities

 

1,592

 

2,016

 

Non-taxable securities

 

19

 

71

 

Federal funds sold and securities purchased under agreements to resell

 

11

 

9

 

Other

 

10

 

9

 

Total interest income

 

6,440

 

7,155

 

Interest expense:

 

 

 

 

 

Deposits

 

1,258

 

1,671

 

Federal funds sold and securities sold under agreement to repurchase

 

8

 

21

 

Other borrowed money

 

720

 

756

 

Total interest expense

 

1,986

 

2,448

 

Net interest income

 

4,454

 

4,707

 

Provision for loan losses

 

360

 

550

 

Net interest income after provision for loan losses

 

4,094

 

4,157

 

Non-interest income:

 

 

 

 

 

Deposit service charges

 

458

 

485

 

Mortgage origination fees

 

191

 

124

 

Commissions on sale of non-deposit investment products

 

175

 

174

 

Gain on sale of securities

 

134

 

2

 

Other-than-temporary-impairment write-down on securities

 

(4

)

(143

)

Fair value adjustment gains (losses)

 

4

 

(196

)

Other

 

469

 

376

 

Total non-interest income

 

1,427

 

822

 

Non-interest expense:

 

 

 

 

 

Salaries and employee benefits

 

2,313

 

2,127

 

Occupancy

 

309

 

314

 

Equipment

 

281

 

288

 

Marketing and public relations

 

171

 

91

 

FDIC Assessment

 

255

 

204

 

Amortization of intangibles

 

155

 

155

 

Other

 

1,239

 

1,007

 

Total non-interest expense

 

4,723

 

4,186

 

Net income before tax

 

798

 

793

 

Income taxes

 

228

 

204

 

Net income

 

$

570

 

$

589

 

Preferred stock dividends, including discount accretion

 

167

 

166

 

Net income available to common shareholders

 

$

403

 

$

423

 

 

 

 

 

 

 

Basic earnings per common share

 

$

0.12

 

$

0.13

 

Diluted earnings per common share

 

$

0.12

 

$

0.13

 

Dividends declared per common share

 

$

0.04

 

$

0.04

 

 

See Notes to Consolidated Financial Statements

 

5



Table of Contents

 

FIRST COMMUNITY CORPORATION

Consolidated Statement of Changes in Shareholders’ Equity and Comprehensive Income

Three Months ended March 31, 2011 and March 31, 2010

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Accumulated

 

 

 

 

 

 

 

Common

 

 

 

Common

 

Additional

 

Nonvested

 

 

 

Other

 

 

 

 

 

Preferred

 

Shares

 

Common

 

Stock

 

Paid-in

 

Restricted

 

Retained

 

Comprehensive

 

 

 

(Dollars in thousands)

 

Stock

 

Issued

 

Stock

 

Warrants

 

Capital

 

Stock

 

Earnings

 

Income (loss)

 

Total

 

Balance December 31, 2009

 

$

10,939

 

3,252

 

$

3,252

 

$

509

 

$

48,873

 

$

(79

)

$

(20,401

)

$

(1,653

)

$

41,440

 

Comprehensive Income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

 

 

 

 

 

 

 

 

 

 

 

 

589

 

 

 

589

 

Other comprehensive loss:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Unrealized gain arising during period on available-for-sale securities net of tax expense of $259

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

480

 

 

 

Unrealized market loss on held-to-maturity securities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reclassification adjustment for Other-than-temporary-Impairment included in income net of tax benefit of $39

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

73

 

 

 

Other comprehensive loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

553

 

553

 

Comprehensive income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1,142

 

Amortization of compensation on restricted stock

 

 

 

 

 

 

 

 

 

 

 

26

 

 

 

 

 

26

 

Dividends: Common ($0.04 per share)

 

 

 

 

 

 

 

 

 

 

 

 

 

(131

)

 

 

(131

)

Preferred

 

24

 

 

 

 

 

 

 

 

 

 

 

(166

)

 

 

(142

)

Dividend reinvestment plan

 

 

 

6

 

6

 

 

 

24

 

 

 

 

 

 

 

30

 

Balance, March 31, 2010

 

$

10,963

 

3,258

 

$

3,258

 

$

509

 

$

48,897

 

$

(53

)

$

(20,109

)

$

(1,100

)

42,365

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance December 31, 2010

 

$

11,035

 

3,270

 

$

3,270

 

$

509

 

$

48,956

 

$

 

$

(19,732

)

$

(2,241

)

$

41,797

 

Comprehensive Income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

 

 

 

 

 

 

 

 

 

 

 

 

570

 

 

 

570

 

Other comprehensive income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Unrealized gain arising during period on available-for-sale securities net of tax expense of $261

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

483

 

 

 

Reclassification adjustment for gain included in net income, net of tax benefit of $47

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(87

)

 

 

Other-than-temporary impairment on securities net of tax benefit of $1

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

3

 

 

 

Other comprehensive income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

399

 

399

 

Comprehensive income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

969

 

Dividends: Common ($0.04 per share)

 

 

 

 

 

 

 

 

 

 

 

 

 

(131

)

 

 

(131

)

Preferred

 

25

 

 

 

 

 

 

 

 

 

 

 

(167

)

 

 

(142

)

Dividend reinvestment plan

 

 

 

4

 

4

 

 

 

18

 

 

 

 

 

 

 

22

 

Balance, March 31, 2011

 

$

11,060

 

3,274

 

$

3,274

 

$

509

 

$

48,974

 

$

 

$

(19,460

)

$

(1,842

)

42,515

 

 

See Notes to Consolidated Financial Statements

 

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Table of Contents

 

FIRST COMMUNITY CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS

 

 

 

Three months ended
March 31,

 

(Dollars in thousands)

 

2011

 

2010

 

Cash flows from operating activities:

 

 

 

 

 

Net income

 

$

570

 

$

589

 

Adjustments to reconcile net income to net cash provided from operating activities:

 

 

 

 

 

Depreciation

 

216

 

229

 

Premium amortization (discount accretion)

 

481

 

272

 

Provision for loan losses

 

360

 

550

 

Writedowns of other real estate owned

 

1

 

51

 

Loss on sale of other real estate owned

 

47

 

3

 

Amortization of intangibles

 

155

 

155

 

Gain on sale of securities

 

(134

)

(2

)

Other-than-temporary-impairment on securities

 

4

 

143

 

Net (increase) decrease in fair value of option instruments and derivatives

 

(4

)

196

 

(Increase) decrease in other assets

 

970

 

(39

)

Decrease in other liabilities

 

(1,447

)

(390

)

Net cash provided from operating activities

 

1,219

 

1,757

 

Cash flows from investing activities:

 

 

 

 

 

Purchase of investment securities available-for-sale

 

(37,184

)

(13,746

)

Maturity of investment securities available-for-sale

 

9,836

 

14,148

 

Proceeds from sale of securities available-for-sale

 

25,965

 

2

 

Maturity of investment securities held-to-maturity

 

 

2,381

 

Increase in loans

 

(6,087

)

(574

)

Proceeds from sale of other real estate owned

 

224

 

155

 

Purchase of property and equipment

 

(57

)

(72

)

Net cash provided (used) in investing activities

 

(7,303

)

2,294

 

Cash flows from financing activities:

 

 

 

 

 

Increase in deposit accounts

 

10,638

 

15,610

 

Increase (decrease) in securities sold under agreements to repurchase

 

1,656

 

(1,223

)

Decrease in other borrowings

 

(20

)

(27

)

Repayment of advances from FHLB

 

(3,254

)

(3,254

)

Dividends paid: Common Stock

 

(131

)

(131

)

          Preferred Stock

 

(167

)

(166

)

Dividend reinvestment plan

 

22

 

30

 

Net cash provided from financing activities

 

8,744

 

10,839

 

Net increase in cash and cash equivalents

 

2,660

 

14,890

 

Cash and cash equivalents at beginning of period

 

26,460

 

20,844

 

Cash and cash equivalents at end of period

 

29,120

 

35,734

 

Supplemental disclosure:

 

 

 

 

 

Cash paid during the period for:

 

 

 

 

 

Interest

 

$

2,360

 

$

2,602

 

Income taxes

 

$

 

$

 

Non-cash investing and financing activities:

 

 

 

 

 

Unrealized gain on securities

 

$

615

 

$

851

 

Transfer of loans to foreclosed property

 

$

1,268

 

$

1,972

 

 

See Notes to Consolidated Financial Statements

 

7



Table of Contents

 

Notes to Consolidated Financial Statements

 

Note 1            - Basis of Presentation

 

In the opinion of management, the accompanying unaudited consolidated balance sheets, and the consolidated statements of income, changes in shareholders’ equity and comprehensive income (loss), and the consolidated statements of cash flows of First Community Corporation (“the Company”), present fairly in all material respects the Company’s financial position at March 31, 2011 and December 31, 2010, the Company’s results of operations and cash flows for the three months ended March 31, 2011 and 2010. The results of operations for the three months ended March 31, 2011 are not necessarily indicative of the results that may be expected for the year ending December 31, 2011.

 

In the opinion of management, all adjustments necessary to fairly present the consolidated financial position and consolidated results of operations have been made. All such adjustments are of a normal, recurring nature.  All significant intercompany accounts and transactions have been eliminated in consolidation. The consolidated financial statements and notes thereto are presented in accordance with the instructions for Form 10-Q.  The information included in the Company’s 2010 Annual Report on Form 10-K should be referred to in connection with these unaudited interim financial statements.

 

Note 2 — Earnings Per Common Share

 

The following reconciles the numerator and denominator of the basic and diluted earnings per common share computation:

 

(In thousands except average market price)

 

 

 

Three months

 

 

 

ended March 31,

 

 

 

2011

 

2010

 

Numerator (Net income available to common shareholders)

 

$

403

 

$

423

 

Denominator

 

 

 

 

 

Weighted average common shares outstanding for:

 

 

 

 

 

Basic earnings per share

 

3,272

 

3,238

 

Dilutive securities:

 

 

 

 

 

Stock options — Treasury stock method

 

 

 

Diluted earnings per share

 

3,272

 

3,238

 

The average market price used in calculating assumed number of shares

 

$

6.34

 

$

6.19

 

 

At March 31, 2011, there were 77,450 outstanding options at an average exercise price of $19.07 and warrants for 196,000 shares at $8.69.  None of the options or warrants has an exercise price below the average market price of $6.34 for the three-month period ended March 31, 2011 and therefore are not deemed to be dilutive.

 

Note 3 —Assets and Liabilities Measured at Fair Value

 

In connection with the adoption of the Fair Value Option, the Company adopted the requirements of the FASB ASC Fair Value Measurement Topic which defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurements.  Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The Fair Value Measurement Topic also establishes a fair value hierarchy which requires an entity to maximize the use of observable

 

8



Table of Contents

 

inputs and minimize the use of unobservable inputs when measuring fair value. The standard describes three levels of inputs that may be used to measure fair value:

 

Note 3 —Assets and Liabilities Measured at Fair Value - continued

 

Level l

Quoted prices in active markets for identical assets or liabilities.

 

Level 2

Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

 

Level 3

Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Level 3 assets and liabilities include financial instruments whose value is determined using pricing models, discounted cash flow methodologies, or similar techniques, as well as instruments for which the determination of fair value requires significant management judgment or estimation.

 

Following is a description of valuation methodologies used for assets and liabilities recorded at fair value on a recurring basis:

 

Investment Securities Available for Sale: Measurement is on a recurring basis based upon quoted market prices, if available.  If quoted market prices are not available, fair values are measured using independent pricing models or other model-based valuation techniques such as the present value of future cash flows, adjusted for prepayment assumptions, projected credit losses, and liquidity.  Level 1 securities include those traded on an active exchange or by dealers or brokers in active over-the-counter markets.  Level 2 securities include mortgage-backed securities issued both issued by government sponsored enterprises and private label mortgage-backed securities.  Generally these fair values are priced from established pricing models.  Level 3 securities include corporate debt obligations and asset—backed securities that are less liquid or for which there is an inactive market.

 

Investment Securities Held-to-Maturity: Investment securities that are held-to-maturity and considered other-than-temporarily-impaired are recorded at fair value in accordance with the FASB ASC Topic on “Investments- Debt and Equity Securities” on a non recurring basis.  If the Company does not expect to recover the entire amortized cost basis of the security, other-than-temporary-impairment (OTTI) is considered to have occurred.  See Note 4 for determining allocation between current earnings and comprehensive income.  Measurement is based upon quoted market prices, if available.  If quoted market prices are not available, fair values are measured using independent pricing models or other model-based valuation techniques such as the present value of future cash flows, adjusted for prepayment assumptions, projected credit losses, and liquidity.  Level 2 securities include private label mortgage-backed securities.  Generally these fair values are priced from established pricing models.

 

Loans: Loans that are considered impaired are recorded at fair value on a non-recurring basis.  Once a loan is considered impaired, measurement is based upon FASB ASC 310-10-35 “Loan Impairment”.  The fair value is estimated using one of several methods, including collateral liquidation value, market value of similar debt and discounted cash flows.  Those impaired loans not requiring a specific charge against the allowance represent loans for which the fair value of the expected repayments or collateral meet or exceed the recorded investment in the loan.  At March 31, 2011, substantially all of the total impaired loans were evaluated based on the fair value of the underlying collateral.  When the Company records the fair value based upon a current appraisal, the fair value measurement is considered a Level 2 measurement.  When a current appraisal is not available or there is estimated further impairment, the measurement is considered a Level 3 measurement.

 

Other Real Estate Owned (OREO): OREO is carried at the lower of carrying value or fair value on a non-recurring basis.  Fair value is based upon independent appraisals or management’s estimation of the collateral and is considered a Level 2 measurement.  When the OREO value is based upon a current appraisal or when a current appraisal is not available or there is estimated further impairment, the measurement is considered a Level 3 measurement.

 

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Table of Contents

 

Note 3 —Assets and Liabilities Measured at Fair Value — continued

 

Derivative Financial Instruments:  Interest rate swaps and interest rate caps are carried at fair value and measured on a recurring basis. The measurement is based on valuation techniques including discounted cash flows analysis for each derivative.  The analysis reflects the contractual remaining term of derivative, interest rates, volatility and expected cash payments.  The measurement of the interest rate swap and cap are considered to be a Level 3 measurement.

 

The following tables reflect the changes in fair values for the three-month periods ended March 31, 2011 and 2010 and where these changes are included in the income statement:

 

(Dollars in thousands)

March 31, 2011

 

Description

 

Non-interest income:
Fair value
adjustment
gain (loss)

 

Total

 

Interest rate cap/swap

 

$

4

 

$

4

 

Total

 

$

4

 

$

4

 

 

(Dollars in thousands)

March 31, 2010

 

Description

 

Non-interest income:
Fair value
adjustment
gain (loss)

 

Total

 

Interest rate cap/swap

 

$

(196

)

$

(196

)

Total

 

$

(196

)

$

(196

)

 

10



Table of Contents

 

Note 3 —Assets and Liabilities Measured at Fair Value - continued

 

The following table summarizes quantitative disclosures about the fair value for each category of assets carried at fair value as of March 31, 2011 and December 31, 2010 that are measured on a recurring basis.

 

(Dollars in thousands)

 

Description

 

March 31,
2011

 

Quoted Prices
in Active
Markets for
Identical
Assets
(Level 1)

 

Significant
Other
Observable
Inputs
(Level 2)

 

Significant
Unobservable
Inputs
(Level 3)

 

Available for sale securities

 

 

 

 

 

 

 

 

 

Government sponsored enterprises

 

$

12,461

 

$

 

$

12,461

 

$

 

Mortgage backed securities

 

118,010

 

 

118,010

 

 

Small Business Administration securities

 

36,623

 

 

36,623

 

 

State and local government

 

20,053

 

 

19,428

 

625

 

Corporate and other securities

 

3,886

 

1,307

 

2,468

 

111

 

 

 

191,033

 

1,307

 

188,990

 

736

 

 

 

 

 

 

 

 

 

 

 

Interest rate cap/swap

 

(690

)

 

 

(690

)

Total

 

$

190,343

 

$

1,307

 

$

188,990

 

$

46

 

 

(Dollars in thousands)

 

Description

 

December
31, 2010

 

Quoted Prices
in Active
Markets for
Identical
Assets
(Level 1)

 

Significant
Other
Observable
Inputs
(Level 2)

 

Significant
Unobservable
Inputs
(Level 3)

 

Available for sale securities

 

 

 

 

 

 

 

 

 

Government sponsored enterprises

 

$

13,738

 

$

 

$

13,738

 

$

 

Mortgage backed securities

 

121,257

 

 

121,257

 

 

Small Business Administration securities

 

31,496

 

 

31,496

 

 

State and local government

 

19,055

 

 

18,430

 

625

 

Corporate and other securities

 

3,763

 

1,118

 

2,463

 

182

 

 

 

189,309

 

1,118

 

187,384

 

807

 

 

 

 

 

 

 

 

 

 

 

Interest rate cap/swap

 

(778

)

 

 

(778

)

Total

 

$

188,531

 

$

1,118

 

$

187,384

 

$

29

 

 

11



Table of Contents

 

Note 3 —Assets and Liabilities Measured at Fair Value - continued

 

The following tables reconcile the changes in Level 3 financial instruments for the three months ended March 31, 2011 and March 31, 2010, that are measured on a recurring basis.

 

(Dollars in thousands)

 

State and local
government
securities

 

Corporate and
other securities

 

Interest rate
Cap/Floor/Swap

 

Beginning Balance December 31, 2010

 

$

625

 

$

182

 

$

(778

)

Total gains or losses (realized/unrealized)

 

 

 

 

 

 

 

Included in earnings

 

 

(4

)

4

 

Included in other comprehensive income

 

 

(67

)

 

Purchases, issuances, and settlements

 

 

 

84

 

Transfers in and/or out of Level 3

 

 

 

 

Ending Balance March 31, 2011

 

$

625

 

$

111

 

$

(690

)

 

(Dollars in thousands)

 

State and local
government
securities

 

Corporate and
other securities

 

Interest rate
Cap/Floor/Swap

 

Beginning Balance December 31, 2009

 

$

0

 

$

5,780

 

$

(535

)

Total gains or losses (realized/unrealized)

 

 

 

 

 

 

 

Included in earnings

 

 

 

(196

)

Included in other comprehensive income

 

 

 

 

Purchases, issuances, and settlements

 

 

 

88

 

Transfers in and/or out of Level 3

 

 

 

 

Ending Balance March 31, 2010

 

 

$

5,780

 

$

(643

)

 

12



Table of Contents

 

Note 3 —Assets and Liabilities Measured at Fair Value - continued

 

The following tables summarize quantitative disclosures about the fair value for each category of assets carried at fair value as of March 31, 2011 and December 31, 2010 that are measured on a non-recurring basis.

 

(Dollars in thousands)

 

Description 

 

March 31,
 2011

 

Quoted Prices
in Active
Markets for
Identical
Assets
(Level 1)

 

Significant
Other
Observable
Inputs
(Level 2)

 

Significant
Unobservable
Inputs
(Level 3)

 

Impaired loans:

 

 

 

 

 

 

 

 

 

Commercial & Industrial

 

$

91

 

$

 

$

91

 

$

 

Real estate:

 

 

 

 

 

 

 

 

 

Mortgage-residential

 

1,433

 

 

1,433

 

 

Mortgage-commercial

 

6,511

 

 

6,511

 

 

Consumer:

 

 

 

 

 

 

 

 

 

Home equity

 

60

 

 

60

 

 

Other

 

11

 

 

11

 

 

Total impaired

 

8,106

 

 

8,106

 

 

Other real estate owned:

 

 

 

 

 

 

 

Construction

 

2,410

 

 

2,410

 

 

Mortgage-residential

 

1,281

 

 

1,281

 

 

Mortgage-commercial

 

4,210

 

 

4,210

 

 

Total other real estate owned

 

7,901

 

 

7,901

 

 

Total

 

$

16,006

 

$

 

$

16,006

 

$

 

 

(Dollars in thousands)

 

Description 

 

December 31,
2010

 

Quoted Prices
in Active
Markets for
Identical
Assets
(Level 1)

 

Significant
Other
Observable
Inputs
(Level 2)

 

Significant
Unobservable
Inputs
(Level 3)

 

Impaired loans:

 

 

 

 

 

 

 

 

 

Commercial & Industrial

 

$

96

 

$

 

$

96

 

$

 

Real estate:

 

 

 

 

 

 

 

 

 

Mortgage-residential

 

1,527

 

 

1,527

 

 

Mortgage-commercial

 

7,914

 

 

7,914

 

 

Consumer:

 

 

 

 

 

 

 

 

 

Home equity

 

38

 

 

38

 

 

Other

 

12

 

 

12

 

 

Total impaired

 

9,587

 

 

9,587

 

 

Other real estate owned:

 

 

 

 

 

 

 

Construction

 

2,331

 

 

2,331

 

 

Mortgage-residential

 

1,267

 

 

1,267

 

 

Mortgage-commercial

 

3,306

 

 

3,306

 

 

Total other real estate owned

 

6,904

 

 

6,904

 

 

Total

 

$

16,491

 

$

 

$

16,491

 

$

 

 

13



Table of Contents

 

Note 3 —Assets and Liabilities Measured at Fair Value - continued

 

The Company has a large percentage of loans with real estate serving as collateral. Loans which are deemed to be impaired are primarily valued on a nonrecurring basis at the fair value of the underlying real estate collateral. Such fair values are obtained using independent appraisals, which the Company considers to be level 2 inputs. The aggregate amount of impaired loans was $8.1 million and $9.6 million for the three months ended March 31, 2011 and year ended December 31, 2010, respectively.

 

Note 4—Investment Securities

 

The amortized cost and estimated fair values of investment securities are summarized below:

 

(Dollars in thousands)

 

Amortized
Cost

 

Gross
Unrealized
Gains

 

Gross
Unrealized
Losses

 

Fair Value

 

March 31, 2011:

 

 

 

 

 

 

 

 

 

Government sponsored enterprises

 

$

12,539

 

$

17

 

$

95

 

$

12,461

 

Mortgage-backed securities

 

120,225

 

932

 

3,147

 

118,010

 

Small Business Administration pools

 

36,550

 

169

 

96

 

36,623

 

State and local government

 

20,285

 

175

 

407

 

20,053

 

Corporate and other securities

 

4,306

 

434

 

854

 

3,886

 

 

 

$

193,905

 

$

1,727

 

$

4,599

 

$

191,033

 

December 31, 2010:

 

 

 

 

 

 

 

 

 

Government sponsored enterprises

 

$

13,793

 

$

44

 

$

99

 

$

13,738

 

Mortgage-backed securities

 

124,113

 

1,558

 

4,414

 

121,257

 

Small Business Administration pools

 

31,451

 

135

 

90

 

31,496

 

State and local government

 

19,128

 

217

 

290

 

19,055

 

Corporate and other securities

 

4,311

 

244

 

792

 

3,763

 

 

 

$

192,796

 

$

2,198

 

$

5,685

 

$

189,309

 

 

During the three months ended March 31, 2011 and March 31, 2010, the Company received proceeds of $25.9 million and $2 thousand, respectively, from the sale of investment securities available-for-sale, amounting to gains of $1.1 million and $2 thousand in earnings for each respective period.  Losses from the sale of investments for the three months ended March 31, 2011 amounted to $1.0 million.  There were no losses on the sale of investments for the three months ended March 31, 2010.  As prescribed by FASB ASC 320-10-35, for the quarter ended March 31, 2011, the Company recognized the credit component of an OTTI of its debt securities in earnings and the non-credit component in other comprehensive income (OCI) for those securities in which the Company does not intend to sell the security and it is more likely than not the Company will not be required to sell the securities prior to recovery.

 

At March 31 2011, corporate and other securities available-for-sale included the following at fair value: corporate bonds at $2.6 million, mutual funds at $885.0 thousand and Federal Home Loan Mortgage Corporation (the “FHLMC” or “Freddie Mac”) preferred stock of $422.4 thousand.  At December 31 2010, corporate and other securities available-for-sale included the following at fair value: corporate bonds at $2.6 million, mutual funds at $883.1 thousand and FHLMC preferred stock of $234.6 thousand.

 

14



Table of Contents

 

Note 4—Investment Securities — continued

 

During the three months ended March 31, 2011 and March 31, 2010, the Company recorded OTTI losses on held-to-maturity and available-for-sale securities as follows:

 

 

 

Three months ended
March 31, 2011

 

Three months ended March 31,
2010

 

(Dollars in thousands)

 

Available-
for-sale
securities

 

Total

 

Held-to-
maturity
mortgage-
backed
securities

 

Available-
for-sale
securities

 

Total

 

Total OTTI charge realized and unrealized

 

$

71

 

$

71

 

$

28

 

$

115

 

$

143

 

OTTI recognized in other comprehensive income (non-credit component)

 

67

 

67

 

 

 

 

Net impairment losses recognized in earnings (credit component)

 

$

4

 

$

4

 

$

28

 

$

115

 

$

143

 

 

During 2011 and 2010, an OTTI occurred of which only a portion was attributed to credit loss and recognized in earnings.  The remainder was reported in other comprehensive income.  The following is an analysis of amounts relating to credit losses on debt securities recognized in earnings during the three months ended March 31, 2011 and March 31, 2010.

 

 

 

2011

 

2010

 

 

 

Available for

 

Available for

 

Held to

 

(Dollars in thousands) 

 

Sale

 

Sale

 

Maturity

 

 

 

 

 

 

 

 

 

Balance at beginning of period

 

$

2,143

 

$

165

 

$

326

 

 

 

 

 

 

 

 

 

Other-than-temporary-impairment not previously recognized

 

 

115

 

 

 

 

 

 

 

 

 

 

Additional increase for which an other-than-temporary impairment was previously recognized related to credit losses

 

4

 

 

28

 

 

 

 

 

 

 

 

 

Other-than-temporary-impairment previously recognized on securities sold

 

(169

)

 

 

 

 

 

 

 

 

 

 

Realized losses during the period

 

(28

)

(73

)

 

Balance related to credit losses on debt securities at end of period

 

$

1,950

 

$

207

 

$

354

 

 

15



Table of Contents

 

Note 4—Investment Securities - continued

 

For the three months ended March 31, 2011, there was one trust preferred security with an OTTI in which only the amount of loss related to credit was recognized in earnings.  The Company uses a third party to obtain information about the structure in order to determine how the underlying cash flows will be distributed to each security. For the trust preferred security, cash flows are evaluated assuming no prepayments with continued defaults of 150 basis-points annually and no subsequent recoveries of previous or ongoing defaults.

 

In evaluating the non-agency mortgage backed securities, relevant assumptions such as prepayment rate, default rate and loss severity on a loan level basis are used in determining the expected recovery of the contractual cash flows. The assumptions are that all loans greater than 60 days delinquent will be resolved across a two-year period at loss severities based on location and category. The balance of the underlying portfolio cash flows are evaluated using ongoing assumptions for loss severities, prepayment rates and default rates. The ongoing assumptions for average prepayment rate, default rate and severity used in the valuations were approximately 5.3%, 3.7%, and 47.0%, respectively. The underlying collateral on substantially all of these securities is fixed rate residential first mortgages located throughout the United States. The underlying collateral includes various percentages of owner-occupied, as well as, investment related single-family, 2-4 family and condominium residential properties. The securities were purchased at various discounts to par value. Based on the assumptions used in valuing the securities, the Company believes the existing discount and remaining subordinated collateral provide coverage against future credit losses on the downgraded securities for which no OTTI has been recognized.

 

16



Table of Contents

 

Note 4—Investment Securities - continued

 

The following tables show gross unrealized losses and fair values, aggregated by investment category and length of time that individual securities have been in a continuous loss position at March 31, 2011 and December 31, 2010.

 

 

 

Less than 12 months

 

12 months or more

 

Total

 

(Dollars in thousands)
March 31, 2011

 

Fair Value

 

Unrealized
Loss

 

Fair Value

 

Unrealized
Loss

 

Fair Value

 

Unrealized
Loss

 

Available-for-sale securities:

 

 

 

 

 

 

 

 

 

 

 

 

 

US Treasury and Government sponsored enterprises

 

$

5,655

 

$

95

 

$

 

$

 

$

5,655

 

$

95

 

Government Sponsored Enterprise mortgage-backed securities

 

46,096

 

619

 

577

 

1

 

46,673

 

620

 

Small Business Administration pools

 

13,758

 

96

 

 

 

13,758

 

96

 

Non-agency mortgage-backed securities

 

1,030

 

29

 

18,809

 

2,498

 

19,839

 

2,527

 

Corporate bonds and other

 

49

 

1

 

1,519

 

853

 

1,568

 

854

 

State and local government

 

12,790

 

407

 

 

 

12,790

 

407

 

Total

 

$

79,378

 

$

1,247

 

$

20,905

 

$

3,353

 

$

100,283

 

$

4,599

 

 

 

 

Less than 12 months

 

12 months or more

 

Total

 

(Dollars in thousands)
December 31, 2010

 

Fair Value

 

Unrealized
Loss

 

Fair Value

 

Unrealized
Loss

 

Fair Value

 

Unrealized
Loss

 

Available-for-sale securities:

 

 

 

 

 

 

 

 

 

 

 

 

 

US Treasury and Government sponsored enterprises

 

$

5,652

 

$

99

 

$

 

$

 

$

5,652

 

$

99

 

Government Sponsored Enterprise mortgage-backed securities

 

32,416

 

402

 

780

 

1

 

33,196

 

403

 

Small Business Administration pools

 

5,355

 

90

 

 

 

5,355

 

90

 

Non-agency mortgage-backed securities

 

1,081

 

29

 

36,065

 

3,982

 

37,146

 

4,011

 

Corporate bonds and other

 

59

 

1

 

1,585

 

791

 

1,644

 

792

 

State and local government

 

8,909

 

290

 

 

 

8,909

 

290

 

Total

 

$

53,472

 

$

911

 

$

38,430

 

$

4,774

 

$

91,902

 

$

5,685

 

 

Government Sponsored Enterprise, Mortgage-Backed Securities: Beginning in 2008 and continuing through 2010 and into 2011, the bond markets and many institutional holders of bonds have come under a great deal of stress partially as a result of increasing delinquencies in the sub-prime mortgage lending market. At March 31, 2011, the Company’s wholly-owned subsidiary, First Community Bank, N.A. (the “Bank”), owns mortgage-backed securities (MBSs) including collateralized mortgage obligations (CMOs) with a book value of $96.8 million and approximate fair value of $97.0 million issued by government sponsored entities (GSEs). Current economic conditions have impacted MBSs issued by GSEs such as the FHLMC and the Federal National Mortgage Association (the “FNMA” or “Fannie Mae”). These entities have experienced increasing delinquencies in the underlying loans that make up the MBSs and CMOs. As of March 31, 2011 and December 31, 2010, all of the MBSs issued by GSEs are classified as “Available for Sale”. Unrealized losses on these investments are not considered to be “other than temporary” and we have the intent and ability to hold these until they mature or recover the current book value. The contractual cash flows of the investments are guaranteed by the GSE. Accordingly, it is expected that the securities would not be settled at a price less than the amortized cost of the Company’s investment. Because the Company has the ability and intent to hold these investments until a recovery of fair value, which may be maturity, the Company does not consider the investments to be other than temporarily impaired OTTI at March 31, 2011.

 

17



Table of Contents

 

Note 4—Investment Securities — continued

 

Non-agency mortgage —backed securities: The Company also holds private label mortgage-backed securities (PLMBSs), including CMOs, at March 31, 2011 with an amortized cost of $23.5 million and approximate fair value of $21.1 million. Although these are not classified as sub-prime obligations or considered the “high risk” tranches, the majority of “structured” investments within all credit markets have been impacted by volatility and credit concerns and economic stresses beginning in 2008 and continuing through 2010 and into 2011. The result has been that the market for these investments has become less liquid and the spread as compared to alternative investments has widened dramatically. During the second quarter of 2008, the Company implemented a leverage strategy whereby we acquired approximately $63.2 million in certain non-agency MBSs and CMOs. All of the mortgage assets acquired in this transaction were classified as prime or ALT-A securities and represented the senior or super-senior tranches of the securities. The assets acquired as part of this strategy were classified as held-to-maturity in the investment portfolio. Due to the significant spreads on these securities, they were all purchased at discounts. A detailed analysis of each of the CMO pools included in this leverage transaction, as well as privately held CMOs held previously in the available-for-sale portfolio, have been analyzed by reviewing underlying loan delinquencies, collateral value and resulting credit support. These securities have continued to experience increasing delinquencies in the underlying loans that make up the MBSs and CMOs. Management monitors each of these pools on a quarterly basis to identify any deterioration in the credit quality, collateral values and credit support underlying the investments.

 

During the quarter ended March 31, 2011, no OTTI charges were recorded in earnings for the PLMBS portfolio.  During the quarter ended March 31, 2010, the Company identified four PLMBS with a fair value of $3.3 million that it considers other-than-temporarily-impaired.  As prescribed by FASB ASC 320-10-65, the Company has recognized an impairment charge in earnings of $75.5 thousand and no impairment charge during the first quarter of 2010 through other comprehensive income.  The $75.5 thousand represents the estimated credit losses on these securities for the quarter ended March 31, 2010.  The credit losses were estimated by projecting the expected cash flows estimating prepayment speeds, increasing defaults and collateral loss severities.  The credit loss portion of the impairment charge represents the difference between the present value of the expected cash flows and the amortized cost basis of the securities.

 

The following table summarizes as of March 31, 2011 the number of CUSIPs, par value, carrying value and fair value of the non-agency mortgage-backed/CMOs securities by credit rating. The credit rating reflects the lowest credit rating by any major rating agency.  All non-agency mortgage-backed /CMO securities are in the super senior or senior tranche.

 

(Dollars in thousands)

 

Credit
Rating

 

Number
of
CUSIPs

 

Par
Value

 

Amortized
Cost

 

Fair
Value

 

AAA

 

11

 

$

3,896

 

$

3,812

 

$

3,761

 

Aa2

 

1

 

100

 

100

 

103

 

A

 

1

 

399

 

399

 

398

 

Below Investment Grade

 

14

 

21,770

 

19,161

 

16,795

 

Total

 

27

 

$

26,165

 

$

23,472

 

$

21,057

 

 

During the first quarter of 2011, the Company sold ten non-agency mortgage-backed securities with a total book value of approximately $26.0 million.  Seven of these securities in the total amount of $17.7 million were rated below investment grade by the rating agencies with the other three being rated above investment grade.  The sales of these non-agency mortgage-backed securities during the quarter have served to significantly reduce the level of securities on the Company’s balance sheet that are rated below investment grade.

 

18



Table of Contents

 

Note 4—Investment Securities - continued

 

Corporate Bonds: The Company’s unrealized loss on investments in corporate bonds relates to bonds with three different issuers. The economic conditions throughout 2009 and 2010 and into 2011 have had a significant impact on all corporate debt obligations. As a result, the spreads on all of the securities have widened dramatically and the liquidity of many of these investments has been negatively impacted. One of these bonds is rated Aa2 by Moody (investment grade) and the other two bonds have been downgraded below investment grade. One downgraded investment, a preferred term security with a book value of $875 thousand and fair value of $111 thousand, is rated C by Fitch and Ca by Moody.  During 2011 and 2010, the Company recorded $4.0 thousand and $1.1 million in OTTI charges on this preferred term security, respectively. The second bond is rated Ba1 by Moody and BBB- by Fitch with a carrying value of $998 thousand and a fair value of $933 thousand and matures in July 2014. All of the corporate bonds held by the Company are reviewed on a quarterly basis to identify downgrades by rating agencies as well as deterioration of the underlying collateral or the issuer’s ability to service the debt obligation. Other than the preferred term security, the Company does not consider these investments to be other-than-temporarily impaired at March 31, 2011.

 

Small Business Administration Pools: These pools are guaranteed pass-thru with the full faith and credit of the United States government.  Because the Company has the ability and intent to hold these investments until a recovery of fair value, which may be maturity, the Company does not consider the investments to be other-than-temporarily impaired at March 31, 2011.

 

State and Local Governments and Other: The unrealized losses on these investments are attributable to increases in interest rates, rather than credit quality. Because the Company has the ability and intent to hold these investments until a recovery of fair value, which may be maturity, the Company does not consider the investments to be other-than-temporarily impaired at March 31, 2011.

 

19



Table of Contents

 

Note 4—Investment Securities - continued

 

The following sets forth the amortized cost and fair value of investment securities at March 31, 2011 by contractual maturity. Expected maturities differ from contractual maturities because borrowers may have the right to call or prepay the obligations with or without prepayment penalties.  Mortgage-backed securities are based on average life at estimated prepayment speeds.

 

 

 

Available-for-sale

 

(Dollars in thousands)

 

Amortized
Cost

 

Fair
Value

 

Due in one year or less

 

$

19,310

 

$

17,396

 

Due after one year through five years

 

78,475

 

77,391

 

Due after five years through ten years

 

72,272

 

70,580

 

Due after ten years

 

23,848

 

25,666

 

 

 

$

193,905

 

$

191,033

 

 

Note 5—Loans

 

Loans summarized by category as of March 31, 2011,  December 31, 2010 and March 31, 2010 are as follows:

 

 

 

March 31,

 

December 31,

 

March 31,

 

(Dollars in thousands)

 

2011

 

2010

 

2010

 

Commercial, financial and agricultural

 

$

20,915

 

$

20,555

 

$

22,194

 

Real estate:

 

 

 

 

 

 

 

Construction

 

11,516

 

10,540

 

16,871

 

Mortgage-residential

 

45,194

 

46,684

 

50,017

 

Mortgage-commercial

 

222,872

 

218,298

 

216,955

 

Consumer:

 

 

 

 

 

 

 

Home equity

 

27,610

 

27,747

 

28,965

 

Other

 

6,049

 

6,130

 

7,201

 

Total

 

$

334,156

 

$

329,954

 

$

342,203

 

 

Activity in the allowance for loan losses for the quarter ended March 31, 2011 and the year ended December 31, 2010 was as follows:

 

 

 

March 31,

 

December 31,

 

(Dollars in thousands)

 

2011

 

2010

 

Balance at the beginning of period

 

$

4,911

 

$

4,854

 

Provision for loan losses

 

360

 

1,878

 

Charged off loans

 

(638

)

(1,948

)

Recoveries

 

22

 

127

 

Balance at end of period

 

$

4,655

 

$

4,911

 

 

20



Table of Contents

 

Note 5—Loans-continued

 

The detailed activity in the allowance for loan losses and the recorded investment in loans receivable as of and for the three months ended March 31, 2011 and the year ended December 31, 2010 is as follows:

 

 

 

 

 

 

 

Real estate

 

Real estate

 

 

 

 

 

 

 

 

 

(Dollars in thousands)

 

 

 

Real estate

 

Mortgage

 

Mortgage

 

Consumer

 

Consumer

 

 

 

 

 

2011

 

Commercial

 

Construction

 

Residential

 

Commercial

 

Home equity

 

Other

 

Unallocated

 

Total

 

Allowance for loan losses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Beginning balance December 31, 2010

 

$

681

 

$

905

 

$

465

 

$

1,404

 

$

325

 

$

88

 

$

1,043

 

$

4,911

 

Charge-offs

 

4

 

 

2

 

519

 

96

 

17

 

 

638

 

Recoveries

 

7

 

 

1

 

 

2

 

12

 

 

22

 

Provisions

 

(149

)

(294

)

(29

)

699

 

222

 

38

 

(127

)

360

 

Ending balance March 31, 2011

 

$

535

 

$

611

 

$

435

 

$

1,584

 

$

453

 

$

121

 

$

916

 

$

4,655

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Ending balances:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Individually evaluated for impairment

 

$

 

$

 

$

 

$

35

 

$

 

$

 

$

 

$

35

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Collectively evaluated for impairment

 

535

 

611

 

435

 

1,549

 

453

 

121

 

916

 

4,620

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loans receivable:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Ending balance-total

 

$

20,915

 

$

11,516

 

$

45,194

 

$

222,872

 

$

27,610

 

$

6,049

 

 

$

334,156

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Ending balances:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Individually evaluated for impairment

 

91

 

 

1,433

 

6,510

 

60

 

11

 

 

8,105

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Collectively evaluated for impairment

 

$

20,824

 

$

11,516

 

$

43,761

 

$

216,362

 

$

27,550

 

$

6,038

 

$

 

$

326,051

 

 

21



Table of Contents

 

Note 5—Loans-continued

 

 

 

 

 

 

 

Real estate

 

Real estate

 

 

 

 

 

 

 

 

 

(Dollars in thousands)