EAGLE FINANCIAL SERVICES INC - FORM 10-Q

EAGLE FINANCIAL SERVICES INC - FORM 10-Q - November 13, 2015

Attached files

Attached files

file	filename
EX-32.1 - EXHIBIT 32.1 - EAGLE FINANCIAL SERVICES INC	efsi-20150930exhibit321.htm
EX-31.2 - EXHIBIT 31.2 - EAGLE FINANCIAL SERVICES INC	efsi-20150930exhibit312.htm
EX-31.1 - EXHIBIT 31.1 - EAGLE FINANCIAL SERVICES INC	efsi-20150930exhibit311.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)



ý	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2015



¨	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number: 0-20146

EAGLE FINANCIAL SERVICES, INC.

(Exact name of registrant as specified in its charter)



Virginia		54-1601306
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

2 East Main Street P.O. Box 391 Berryville, Virginia		22611
(Address of principal executive offices)		(Zip Code)

(540) 955-2510

(Registrant’s telephone number, including area code)

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 ý No ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Date 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). Yes ý 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. (Check one):

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

The number of shares of the registrant’s Common Stock ($2.50 par value) outstanding as of October 31, 2015 was 3,508,831.

TABLE OF CONTENTS




PART I - FINANCIAL INFORMATION

Item 1.	Financial Statements:
	Consolidated Balance Sheets at September 30, 2015 and December 31, 2014	1
	Consolidated Statements of Income for the Three and Nine Months Ended September 30, 2015 and 2014	2
	Consolidated Statements of Comprehensive Income for the Three and Nine Months Ended September 30, 2015 and 2014	4
	Consolidated Statements of Changes in Shareholders’ Equity for the Nine Months Ended September 30, 2015 and 2014	5
	Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2015 and 2014	6
	Notes to Consolidated Financial Statements	8
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	33
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	44
Item 4.	Controls and Procedures	45

PART II - OTHER INFORMATION

Item 1.	Legal Proceedings	45
Item 1A.	Risk Factors	45
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	45
Item 3.	Defaults Upon Senior Securities	45
Item 4.	Mine Safety Disclosures	45
Item 5.	Other Information	45
Item 6.	Exhibits	46

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements

EAGLE FINANCIAL SERVICES, INC.

Consolidated Balance Sheets

(dollars in thousands, except share amounts)



	September 30, 2015			December 31, 2014
	(Unaudited)
Assets
Cash and due from banks	$	9,758		$	9,075
Interest-bearing deposits with other institutions	7,183			25,489
Total cash and cash equivalents	16,941			34,564
Securities available for sale, at fair value	101,182			94,165
Restricted investments	2,321			2,808
Loans	491,216			469,820
Allowance for loan losses	(5,164		)	(5,080		)
Net Loans	486,052			464,740
Bank premises and equipment, net	20,924			19,015
Other real estate owned, net of allowance	1,848			2,102
Other assets	8,801			9,436
Total assets	$	638,069		$	626,830
Liabilities and Shareholders’ Equity
Liabilities
Deposits:
Noninterest bearing demand deposits	$	177,005		$	159,352
Savings and interest bearing demand deposits	255,135			249,305
Time deposits	95,731			95,159
Total deposits	$	527,871		$	503,816
Federal Home Loan Bank advances	30,000			40,000
Trust preferred capital notes	—			7,217
Other liabilities	2,589			2,665
Total liabilities	$	560,460		$	553,698
Shareholders’ Equity
Preferred stock, $10 par value; 500,000 shares authorized and unissued	$	—		$	—
Common stock, $2.50 par value; authorized 10,000,000 shares; issued and outstanding 2015, 3,508,831 including 19,401 shares of unvested restricted stock; issued and outstanding 2014, 3,463,665 including 15,151 shares of unvested restricted stock	8,723			8,621
Surplus	13,464			12,618
Retained earnings	54,029			50,578
Accumulated other comprehensive income	1,393			1,315
Total shareholders’ equity	$	77,609		$	73,132
Total liabilities and shareholders’ equity	$	638,069		$	626,830

See Notes to Consolidated Financial Statements

EAGLE FINANCIAL SERVICES, INC.

Consolidated Statements of Income (Unaudited)

(dollars in thousands, except per share amounts)



	Three Months Ended					Nine Months Ended
	September 30,					September 30,
	2015			2014		2015			2014
Interest and Dividend Income
Interest and fees on loans	$	5,540		$	5,397	$	16,278		$	16,317
Interest and dividends on securities available for sale:
Taxable interest income	437			458		1,219			1,447
Interest income exempt from federal income taxes	244			270		733			834
Dividends	42			126		75			197
Interest on deposits with other institutions	2			2		19			4
Total interest and dividend income	$	6,265		$	6,253	$	18,324		$	18,799
Interest Expense
Interest on deposits	185			241		551			730
Interest on federal funds purchased and securities sold under agreements to repurchase	9			—		10			20
Interest on Federal Home Loan Bank advances	69			159		269			476
Interest on trust preferred capital notes	12			33		78			98
Interest on interest rate swap	46			47		137			139
Total interest expense	$	321		$	480	$	1,045		$	1,463
Net interest income	$	5,944		$	5,773	$	17,279		$	17,336
(Recovery Of) Provision For Loan Losses	(410		)	—		23			—
Net interest income after (recovery of) provision for loan losses	$	6,354		$	5,773	$	17,256		$	17,336
Noninterest Income
Income from fiduciary activities	$	319		$	212	$	1,103		$	873
Service charges on deposit accounts	329			332		926			984
Other service charges and fees	919			827		2,605			2,307
Gain on sale of securities	20			87		116			93
Gain on redemption of trust preferred capital notes	2,424			—		2,424			—
Other operating (loss) income	(181		)	15		(71		)	127
Total noninterest income	$	3,830		$	1,473	$	7,103		$	4,384
Noninterest Expenses
Salaries and employee benefits	$	3,090		$	3,017	$	9,197		$	8,768
Occupancy expenses	394			319		1,176			963
Equipment expenses	312			197		718			546
Advertising and marketing expenses	155			159		458			417
Stationery and supplies	67			74		179			238
ATM network fees	246			174		595			532
Other real estate owned expense	63			4		83			14
(Gain) loss on the sale of other real estate owned	(11		)	14		81			(3		)
FDIC assessment	108			94		319			261
Computer software expense	134			252		547			664
Bank franchise tax	131			123		374			342
Professional fees	211			290		714			761
Cost to terminate operating lease	—			—		520			—
Other operating expenses	618			616		1,746			1,639
Total noninterest expenses	$	5,518		$	5,333	$	16,707		$	15,142
Income before income taxes	$	4,666		$	1,913	$	7,652		$	6,578
Income Tax Expense	1,377			528		2,110			1,872
Net income	$	3,289		$	1,385	$	5,542		$	4,706
Earnings Per Share
Net income per common share, basic	$	0.94		$	0.40	$	1.59		$	1.37
Net income per common share, diluted	$	0.94		$	0.40	$	1.59		$	1.37

See Notes to Consolidated Financial Statements

EAGLE FINANCIAL SERVICES, INC.

Consolidated Statements of Comprehensive Income

(Unaudited)

(dollars in thousands)



	Three Months Ended					Nine Months Ended
	September 30,					September 30,
	2015		2014			2015			2014
Net income	$	3,289	$	1,385		$	5,542		$	4,706
Other comprehensive income (loss):
Unrealized gain (loss) on available for sale securities, net of deferred income tax expense (benefit) of $259 and ($39) for the three months ended, respectively and ($58) and $588 for the nine months ended, respectively	503		(76		)	(112		)	1,143
Change in fair value of interest rate swap, net of deferred income tax expense of $81 and $22 for the three months ended, respectively and $99 and $41 for the nine months ended, respectively	156		41			190			79
Total other comprehensive income (loss)	659		(35		)	78			1,222
Total comprehensive income	$	3,948	$	1,350		$	5,620		$	5,928

See Notes to Consolidated Financial Statements

EAGLE FINANCIAL SERVICES, INC.

Consolidated Statements of Changes in Shareholders’ Equity (Unaudited)

(dollars in thousands, except share amounts)



	Common Stock		Surplus			Retained Earnings			Accumulated Other Comprehensive Income		Total
Balance, December 31, 2013	$	8,482	$	11,537		$	46,082		$	305	$	66,406
Net income						4,706					4,706
Other comprehensive income									1,222		1,222
Vesting of restricted stock awards, stock incentive plan (10,009 shares)	25		(25		)						—
Income tax benefit on vesting of restricted stock			11								11
Stock options exercised (927 shares)	2		(2		)						—
Stock-based compensation expense			173								173
Issuance of common stock, dividend investment plan (23,473 shares)	59		456								515
Issuance of common stock, employee benefit plan (7,995 shares)	20		162								182
Dividends declared ($0.57 per share)						(1,954		)			(1,954		)
Balance, September 30, 2014	$	8,588	$	12,312		$	48,834		$	1,527	$	71,261

Balance, December 31, 2014	$	8,621	$	12,618		$	50,578		$	1,315	73,132
Net income						5,542					5,542
Other comprehensive income									78		78
Vesting of restricted stock awards, stock incentive plan (9,363 shares)	23		(23		)						—
Income tax benefit on vesting of restricted stock			4								4
Stock-based compensation expense			227								227
Issuance of common stock, dividend investment plan (24,439 shares)	61		490								551
Issuance of common stock, employee benefit plan (7,114 shares)	18		148								166
Dividends declared ($0.60 per share)						(2,091		)			(2,091		)
Balance, September 30, 2015	$	8,723	$	13,464		$	54,029		$	1,393	$	77,609

See Notes to Consolidated Financial Statements

EAGLE FINANCIAL SERVICES, INC.

Consolidated Statements of Cash Flows (Unaudited)

(dollars in thousands)



	Nine Months Ended
	September 30,
	2015			2014
Cash Flows from Operating Activities
Net income	$	5,542		$	4,706
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation	619			587
Amortization of intangible and other assets	154			117
Provision for loan losses	23			—
Provision for other real estate owned	53			—
Loss (gain) on the sale of other real estate owned	81			(3		)
(Gain) on the sale of premises and equipment	(5		)	—
Loss on the sale of repossessed assets	—			5
(Gain) on the sale of securities	(116		)	(93		)
(Gain) on the redemption of trust preferred capital notes	(2,424		)	—
Loss on derecognition of cash flow hedge	237			—
Fair value adjustment on derivative contract	(30		)	—
Stock-based compensation expense	227			173
Premium amortization on securities, net	191			88
Changes in assets and liabilities:
Decrease (increase) in other assets	437			(812		)
Increase (decrease) in other liabilities	6			(262		)
Net cash provided by operating activities	$	4,995		$	4,506
Cash Flows from Investing Activities
Proceeds from maturities and principal payments of securities available for sale	$	10,641		$	9,264
Proceeds from the sale of securities available for sale	3,424			1,129
Purchases of securities available for sale	(21,327		)	(5,081		)
Proceeds from the sale of restricted investments	900			284
Purchases of restricted investments	(413		)	(450		)
Purchases of bank premises and equipment	(2,528		)	(2,272		)
Proceeds from the sale of other real estate owned	856			685
Proceeds from the sale of bank premises and equipment	5			—
Proceeds from the sale of repossessed assets	10			26
Net (increase) in loans	(22,074		)	(21,039		)
Net cash (used in) investing activities	$	(30,506	)	$	(17,454	)
Cash Flows from Financing Activities
Net increase in noninterest bearing demand deposits, savings, and interest bearing demand deposits	$	23,483		$	12,250
Net increase (decrease) in time deposits	572			(4,700		)
Net (decrease) increase in Federal Home Loan Bank advances	(10,000		)	7,750
Redemption of trust preferred capital notes	(4,793		)	—
Issuance of common stock, employee benefit plan	166			182
Cash dividends paid	(1,540		)	(1,439		)
Net cash provided by financing activities	$	7,888		$	14,043

EAGLE FINANCIAL SERVICES, INC.

Consolidated Statements of Cash Flows (Unaudited)

(continued)



	Nine Months Ended
	September 30,
	2015			2014
(Decrease) increase in cash and cash equivalents	$	(17,623	)	$	1,095
Cash and Cash Equivalents
Beginning	34,564			14,243
Ending	$	16,941		$	15,338
Supplemental Disclosures of Cash Flow Information
Cash payments for:
Interest	$	1,141		$	1,474
Income taxes	$	583		$	1,985
Supplemental Schedule of Noncash Investing and Financing Activities:
Unrealized (loss) gain on securities available for sale	$	(170	)	$	1,731
Change in fair value of interest rate swap	$	52		$	120
Other real estate and repossessed assets acquired in settlement of loans	$	739		$	680
Issuance of common stock, dividend investment plan	$	551		$	515

EAGLE FINANCIAL SERVICES, INC.

Notes to Consolidated Financial Statements (Unaudited)

September 30, 2015

NOTE 1. General

The accompanying unaudited financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America.

In the opinion of management, the accompanying financial statements contain all adjustments (consisting of only normal recurring accruals) necessary to present fairly the financial position at September 30, 2015 and December 31, 2014, the results of operations for the three and nine months ended September 30, 2015 and 2014, and cash flows for the nine months ended September 30, 2015 and 2014. The results of operations for the three and nine months ended September 30, 2015 are not necessarily indicative of the results to be expected for the full year. These financial statements should be read in conjunction with the Notes to Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2014 (the “2014 Form 10-K”).

The Company owns 100% of Bank of Clarke County (the “Bank”). The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary. All significant intercompany accounts and transactions between the Company and the Bank have been eliminated.

Certain amounts in the consolidated financial statements have been reclassified to conform to current year presentations. None of the reclassifications were of a material nature.

NOTE 2. Stock-Based Compensation Plan

During 2014, the Company’s shareholders approved a stock incentive plan which allows key employees and directors to increase their personal financial interest in the Company. This plan permits the issuance of incentive stock options and non-qualified stock options and the award of stock appreciation rights, common stock, restricted stock, and phantom stock. The plan authorizes the issuance of up to 500,000 shares of common stock.

The Company periodically grants Restricted Stock to its directors and executive officers. Restricted Stock provides grantees with rights to shares of common stock upon completion of a service period or achievement of Company performance measures. During the restriction period, all shares are considered outstanding and dividends are paid to the grantee. In general, outside directors are periodically granted restricted shares which vest over a period of less than 9 months. Beginning during 2006, executive officers were granted restricted shares which vest over a 3 year service period and restricted shares which vest based on meeting annual performance measures. The Company recognizes compensation expense over the restricted period. As of September 30, 2015, there was $138 thousand of unrecognized compensation cost related to nonvested restricted stock.

The following table presents Restricted Stock activity for the nine months ended September 30, 2015 and 2014:



	Nine Months Ended
	September 30,
	2015				2014
	Shares		Weighted Average Grant Date Fair Value		Shares		Weighted Average Grant Date Fair Value
Nonvested, beginning of period	15,151		$	22.27	17,050		$	19.92
Granted	14,650		23.85		14,900		23.50
Vested	(9,363	)	21.80		(10,009	)	19.65
Forfeited	(1,037	)	23.50		(2,790	)	22.11
Nonvested, end of period	19,401		$	23.63	19,151		$	22.53

NOTE 3. Earnings Per Common Share

Basic earnings per share represents income available to common shareholders divided by the weighted average number of common shares outstanding during the period. Nonvested restricted shares are included in basic earnings per share because of dividend participation and voting rights. Diluted earnings per share reflects additional common shares that would have been outstanding if dilutive potential common shares had been issued, as well as any adjustment to income that would result from the assumed issuance. The number of potential common shares is determined using the treasury method.

The following table shows the weighted average number of shares used in computing earnings per share for the three and nine months ended September 30, 2015 and 2014 and the effect on the weighted average number of shares of dilutive potential common stock. During 2015 and 2014, there were no potentially dilutive securities outstanding.



	Three Months Ended		Nine Months Ended
	September 30,		September 30,
	2015	2014	2015	2014
Average number of common shares outstanding	3,503,412	3,451,041	3,489,388	3,431,356
Effect of dilutive common stock	—	—	—	—
Average number of common shares outstanding used to calculate diluted earnings per share	3,503,412	3,451,041	3,489,388	3,431,356

NOTE 4. Securities

Amortized costs and fair values of securities available for sale at September 30, 2015 and December 31, 2014 were as follows:



	Amortized Cost		Gross Unrealized Gains		Gross Unrealized (Losses)			Fair Value
	September 30, 2015
	(in thousands)
Obligations of U.S. government corporations and agencies	$	38,808	$	625	$	(48	)	$	39,385
Mortgage-backed securities	21,111		384		(83		)	21,412
Obligations of states and political subdivisions	39,210		1,195		(20		)	40,385
	$	99,129	$	2,204	$	(151	)	$	101,182
	December 31, 2014
	(in thousands)
Obligations of U.S. government corporations and agencies	$	36,911	$	599	$	(299	)	$	37,211
Mortgage-backed securities	15,245		545		(11		)	15,779
Obligations of states and political subdivisions	39,025		1,432		(47		)	40,410
Corporate securities	761		4		—			765
	$	91,942	$	2,580	$	(357	)	$	94,165

During the nine months ended September 30, 2015, the Company received proceeds of $3.4 million on sales of available for sale securities for a gross gain of $116 thousand. There were no losses on the sale of available for sale securities during the nine months ended September 30, 2015. During the nine months ended September 30, 2014, the Company sold $1.1 million of available for sale securities for a gross gain of $93 thousand. There were no losses on the sale of available for sale securities during the nine months ended September 30, 2014.

The fair value and gross unrealized losses for securities available for sale, totaled by the length of time that individual securities have been in a continuous gross unrealized loss position, at September 30, 2015 and December 31, 2014 were as follows:



	Less than 12 months				12 months or more				Total
	Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses
	September 30, 2015
	(in thousands)
Obligations of U.S. government corporations and agencies	$	11,877	$	39	$	1,991	$	9	$	13,868	$	48
Mortgage-backed securities	7,313		68		1,190		15		8,503		83
Obligations of states and political subdivisions	3,530		18		1,012		2		4,542		20
	$	22,720	$	125	$	4,193	$	26	$	26,913	$	151
	December 31, 2014
	(in thousands)
Obligations of U.S. government corporations and agencies	$	1,997	$	1	$	21,615	$	298	$	23,612	$	299
Mortgage-backed securities	—		—		1,444		11		1,444		11
Obligations of states and political subdivisions	2,998		12		2,414		35		5,412		47
	$	4,995	$	13	$	25,473	$	344	$	30,468	$	357

Gross unrealized losses on available for sale securities included twenty-nine (29) and thirty-eight (38) debt securities at September 30, 2015 and December 31, 2014, respectively. The Company evaluates securities for other-than-temporary impairment on at least a quarterly basis, and more frequently when economic or market concerns warrant such evaluation. Consideration is given to the length of time and the amount of an unrealized loss, the financial condition of the issuer, and the intent and ability of the Company to retain its investment in the issuer long enough to allow for an anticipated recovery in fair value. The fair value of a security reflects its liquidity as compared to similar instruments, current market rates on similar instruments, and the creditworthiness of the issuer. Absent any change in the liquidity of a security or the creditworthiness of the issuer, prices will decline as market rates rise and vice-versa. The primary cause of the unrealized losses at September 30, 2015 and December 31, 2014 was changes in market interest rates. Since the losses can be primarily attributed to changes in market interest rates and not expected cash flows or an issuer’s financial condition, the unrealized losses are deemed to be temporary. The continuing economic recession involving housing, liquidity and credit were also a contributing factor to the unrealized losses on these securities at September 30, 2015 and December 31, 2014. The Company’s mortgage-backed securities are issued by U.S. government agencies, which guarantee payments to investors regardless of the status of the underlying mortgages. The Company monitors the financial condition of these issuers continuously and will record other-than-temporary impairment if the recovery of value is unlikely.

The Company’s securities are exposed to various risks, such as interest rate, market, currency and credit risks. Due to the level of risk associated with certain securities and the level of uncertainty related to changes in the value of securities, it is at least reasonably possible that changes in risks in the near term would materially affect securities reported in the financial statements. In addition, recent economic uncertainty and market events have led to unprecedented volatility in currency, commodity, credit and equity markets culminating in failures of some banking and financial services firms and government intervention to solidify others. These events underscore the level of investment risk associated with the current economic environment, and accordingly the level of risk in the Company’s securities.

Securities having a carrying value of $3.4 million at September 30, 2015 were pledged to secure securities sold under agreements to repurchase and other purposes required by law.

The composition of restricted investments at September 30, 2015 and December 31, 2014 was as follows:



	September 30, 2015		December 31, 2014
	(in thousands)
Federal Reserve Bank Stock	$	344	$	344
Federal Home Loan Bank Stock	1,837		2,324
Community Bankers’ Bank Stock	140		140
	$	2,321	$	2,808

NOTE 5. Allowance for Loan Losses

Changes in the allowance for loan losses for the nine months ended September 30, 2015 and 2014 and the year ended December 31, 2014 were as follows:



	Nine Months Ended			Year Ended			Nine Months Ended
	September 30,			December 31,			September 30,
	2015			2014			2014
				(in thousands)
Balance, beginning	$	5,080		$	5,488		$	5,488
Provision charged to operating expense	23			350			—
Recoveries added to the allowance	499			725			614
Loan losses charged to the allowance	(438		)	(1,483		)	(515		)
Balance, ending	$	5,164		$	5,080		$	5,587

Nonaccrual and past due loans by class at September 30, 2015 and December 31, 2014 were as follows:



	September 30, 2015
	(in thousands)
	30 - 59 Days Past Due		60 - 89 Days Past Due		90 or More Days Past Due		Total Past Due		Current		Total Loans		90 or More Days Past Due Still Accruing		Nonaccrual Loans
Commercial - Non Real Estate:
Commercial & Industrial	$	108	$	—	$	—	$	108	$	27,310	$	27,418	$	—	$	560
Commercial Real Estate:
Owner Occupied	871		—		—		871		108,604		109,475		—		1,712
Non-owner occupied	907		—		766		1,673		61,784		63,457		—		971
Construction and Farmland:
Residential	—		249		140		389		8,205		8,594		—		140
Commercial	—		53		—		53		32,314		32,367		—		326
Consumer:
Installment	58		1		1		60		13,556		13,616		1		—
Residential:
Equity Lines	3,423		6		—		3,429		31,270		34,699		—		281
Single family	2,397		—		733		3,130		192,830		195,960		—		1,683
Multifamily	—		—		—		—		3,453		3,453		—		—
All Other Loans	—		—		—		—		2,177		2,177		—		—
Total	$	7,764	$	309	$	1,640	$	9,713	$	481,503	$	491,216	$	1	$	5,673



	December 31, 2014
	(in thousands)
	30 - 59 Days Past Due		60 - 89 Days Past Due		90 or More Days Past Due		Total Past Due		Current		Total Loans		90 or More Past Due Still Accruing		Nonaccrual Loans
Commercial - Non Real Estate:
Commercial & Industrial	$	28	$	—	$	—	$	28	$	28,104	$	28,132	$	—	$	2,106
Commercial Real Estate:
Owner Occupied	2,191		—		—		2,191		97,516		99,707		—		2,591
Non-owner occupied	56		210		808		1,074		60,518		61,592		—		1,231
Construction and Farmland:
Residential	—		52		—		52		5,149		5,201		—		—
Commercial	—		—		57		57		31,231		31,288		—		787
Consumer:
Installment	50		15		6		71		13,803		13,874		6		—
Residential:
Equity Lines	132		41		185		358		30,763		31,121		—		331
Single family	1,243		440		644		2,327		191,246		193,573		—		3,660
Multifamily	—		—		—		—		3,016		3,016		—		—
All Other Loans	—		—		—		—		2,316		2,316		—		—
Total	$	3,700	$	758	$	1,700	$	6,158	$	463,662	$	469,820	$	6	$	10,706

Allowance for loan losses by segment at September 30, 2015 and December 31, 2014 were as follows:



	As of and for the Nine Months Ended
	September 30, 2015
	(in thousands)
	Construction and Farmland			Residential			Commercial Real Estate			Commercial - Non Real Estate			Consumer			All Other Loans			Unallocated		Total
Allowance for credit losses:
Beginning Balance	$	951		$	1,977		$	1,347		$	464		$	103		$	42		$	196	$	5,080
Charge-Offs	(166		)	(152		)	(47		)	—			(54		)	(19		)	—		(438		)
Recoveries	63			157			60			179			26			14			—		499
Provision	85			102			89			(307		)	27			13			14		23
Ending balance	$	933		$	2,084		$	1,449		$	336		$	102		$	50		$	210	$	5,164
Ending balance: Individually evaluated for impairment	$	138		$	343		$	102		$	8		$	—		$	—		$	—	$	591
Ending balance: collectively evaluated for impairment	$	795		$	1,741		$	1,347		$	328		$	102		$	50		$	210	$	4,573
Loans:
Ending balance	$	40,961		$	234,112		$	172,932		$	27,418		$	13,616		$	2,177		$	—	$	491,216
Ending balance individually evaluated for impairment	$	2,266		$	7,052		$	4,746		$	953		$	—		$	—		$	—	$	15,017
Ending balance collectively evaluated for impairment	$	38,695		$	227,060		$	168,186		$	26,465		$	13,616		$	2,177		$	—	$	476,199



	As of and for the Twelve Months Ended
	December 31, 2014
	(in thousands)
	Construction and Farmland			Residential			Commercial Real Estate			Commercial - Non Real Estate			Consumer			All Other Loans			Unallocated		Total
Allowance for credit losses:
Beginning Balance	$	1,032		$	2,225		$	1,337		$	555		$	102		$	82		$	155	$	5,488
Charge-Offs	(482		)	(808		)	(83		)	—			(86		)	(24		)	—		(1,483		)
Recoveries	26			63			381			164			87			4			—		725
Provision	375			497			(288		)	(255		)	—			(20		)	41		350
Ending balance	$	951		$	1,977		$	1,347		$	464		$	103		$	42		$	196	$	5,080
Ending balance: Individually evaluated for impairment	$	93		$	303		$	203		$	44		$	—		$	—		$	—	$	643
Ending balance: collectively evaluated for impairment	$	858		$	1,674		$	1,144		$	420		$	103		$	42		$	196	$	4,437
Loans:
Ending balance	$	36,489		$	227,710		$	161,299		$	28,132		$	13,874		$	2,316		$	—	$	469,820
Ending balance individually evaluated for impairment	$	2,665		$	6,550		$	5,716		$	2,106		$	—		$	—		$	—	$	17,037
Ending balance collectively evaluated for impairment	$	33,824		$	221,160		$	155,583		$	26,026		$	13,874		$	2,316		$	—	$	452,783

Impaired loans by class as of and for the periods ended September 30, 2015 and December 31, 2014 were as follows:



	As of and for the Nine Months Ended
	September 30, 2015
	(in thousands)
	Unpaid Principal Balance		Recorded Investment (1)		Related Allowance		Average Recorded Investment		Interest Income Recognized
With no related allowance:
Commercial - Non Real Estate:
Commercial & Industrial	$	1,081	$	881	$	—	$	1,075	$	3
Commercial Real Estate:
Owner Occupied	2,439		2,273		—		2,375		22
Non-owner occupied	1,242		1,176		—		1,183		—
Construction and Farmland:
Residential	140		140		—		134		3
Commercial	1,367		1,348		—		1,372		34
Residential:
Equity lines	399		219		—		221		1
Single family	4,663		4,550		—		4,701		104
Multifamily	—		—		—		—		—
Other Loans	—		—		—		—		—
	$	11,331	$	10,587	$	—	$	11,061	$	167
With an allowance recorded:
Commercial - Non Real Estate:
Commercial & Industrial	$	73	$	73	$	8	$	81	$	13
Commercial Real Estate:
Owner Occupied	—		—		—		—		—
Non-owner occupied	1,299		1,303		102		1,315		52
Construction and Farmland:
Residential	—		—		—		—		—
Commercial	778		781		138		809		24
Residential:
Equity lines	304		148		76		149		2
Single family	2,162		2,152		267		2,166		31
Multifamily	—		—		—		—		—
Other Loans	—		—		—		—		—
	$	4,616	$	4,457	$	591	$	4,520	$	122
Total:

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