Finward Bancorp Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

Note 5 - Loans Receivable (Tables)

Note 5 - Loans Receivable (Tables)

9 Months Ended

Sep. 30, 2019

Schedule of Accounts, Notes, Loans and Financing Receivable [Table Text Block]

(Dollars in thousands)
	September 30, 2019			December 31, 2018
Loans secured by real estate:
Residential real estate	$	298,138		$	224,082
Home equity		49,719			45,423
Commercial real estate		282,536			253,104
Construction and land development		79,351			64,433
Multifamily		50,878			47,234
Farmland		230			240
Total loans secured by real estate		760,852			634,516
Commercial business		109,485			103,628
Consumer		763			495
Manufactured homes		12,882			4,798
Government		17,609			21,101
Subtotal		901,591			764,538
Less:
Net deferred loan origination fees		2,813			530
Undisbursed loan funds		(131	)		(668	)
Loans receivable	$	904,273		$	764,400

Financing Receivable, Allowance for Credit Loss [Table Text Block]

(Dollars in thousands)	Beginning Balance		Charge-offs			Recoveries		Provisions			Ending Balance

The Bancorp's activity in the allowance for loan losses, by loan segment, is summarized below for the three months ended September 30, 2019:

Allowance for loan losses:
Residential real estate	$	1,660	$	(62	)	$	5	$	149		$	1,752
Home equity		202		-			2		23			227
Commercial real estate		3,529		-			-		178			3,707
Construction and land development		806		-			-		188			994
Multifamily		453		-			-		51			504
Farmland		-		-			-		-			-
Commercial business		1,517		(9	)		8		405			1,921
Consumer		51		(13	)		5		7			50
Manufactured homes		505		-			-		(505	)		-
Government		21		-			-		(2	)		19
Total	$	8,744	$	(84	)	$	20	$	494		$	9,174

The Bancorp's activity in the allowance for loan losses, by loan segment, is summarized below for the three months ended September 30, 2018:

Allowance for loan losses:
Residential real estate	$	1,523	$	(30	)	$	-	$	82		$	1,575
Home equity		183		-			-		10			193
Commercial real estate		3,170		-			22		48			3,240
Construction and land development		611		-			-		(32	)		579
Multifamily		607		-			-		(150	)		457
Farmland		4		-			-		(1	)		3
Commercial business		1,264		-			8		61			1,333
Consumer		36		(19	)		8		298			323
Manufactured homes		-		-			-		-			-
Government		50		-			-		(4	)		46
Total	$	7,448	$	(49	)	$	38	$	312		$	7,749

(Dollars in thousands)	Beginning Balance		Charge-offs			Recoveries		Provisions			Ending Balance

The Bancorp's activity in the allowance for loan losses, by loan segment, is summarized below for the nine months ended September 30, 2019:

Allowance for loan losses:
Residential real estate	$	1,715	$	(128	)	$	23	$	142		$	1,752
Home equity		202		-			4		21		$	227
Commercial real estate		3,335		-			-		372		$	3,707
Construction and land development		756		-			-		238		$	994
Multifamily		472		-			-		32		$	504
Farmland		-		-			-		-		$	-
Commercial business		1,362		(9	)		24		544		$	1,921
Consumer		41		(38	)		14		33		$	50
Manufactured homes		41		-			-		(41	)	$	-
Government		38		-			-		(19	)	$	19
Total	$	7,962	$	(175	)	$	65	$	1,322		$	9,174

The Bancorp's activity in the allowance for loan losses, by loan segment, is summarized below for the nine months ended September 30, 2018:

Allowance for loan losses:
Residential real estate	$	1,568	$	(136	)	$	-	$	143		$	1,575
Home equity		166		(24	)		-		51			193
Commercial real estate		3,125		(119	)		24		210			3,240
Construction and land development		618		-			-		(39	)		579
Multifamily		622		-			-		(165	)		457
Farmland		-		-			-		3			3
Commercial business		1,298		(529	)		125		439			1,333
Consumer		31		(41	)		17		316			323
Manufactured homes		-		-			-		-			-
Government		54		-			-		(8	)		46
Total	$	7,482	$	(849	)	$	166	$	950		$	7,749

Financing Receivable, Impairment Evaluation [Table Text Block]

	Ending Balances

(Dollars in thousands)	Individually evaluated for impairment reserves		Collectively evaluated for impairment reserves		Loan receivables		Individually evaluated for impairment		Purchased credit impaired individually evaluated for impairment		Collectively evaluated for impairment

The Bancorp's allowance for loan losses impairment evaluation and loan receivables are summarized below at September 30, 2019:

Residential real estate	$	17	$	1,735	$	297,830	$	628	$	1,747	$	295,455
Home equity		9		218		49,781		282		220		49,279
Commercial real estate		218		3,489		282,536		1,352		486		280,698
Construction and land development		-		994		79,351		-		-		79,351
Multifamily		-		504		50,878		-		684		50,194
Farmland		-		-		230		-		-		230
Commercial business		967		954		109,359		2,436		1,147		105,776
Consumer		-		50		1,334		-		-		1,334
Manufactured homes		-		-		15,365		-		-		15,365
Government		-		19		17,609		-		-		17,609
Total	$	1,211	$	7,963	$	904,273	$	4,698	$	4,284	$	895,291


The Bancorp's allowance for loan losses impairment evaluation and loan receivables are summarized below at December 31, 2018:

Residential real estate	$	22		1,693		223,323	$	570	$	980	$	221,773
Home equity		9		193		45,483		141		123		45,219
Commercial real estate		210		3,125		253,104		1,703		402		250,999
Construction and land development		-		756		64,433		-		-		64,433
Multifamily		-		472		47,234		-		-		47,234
Farmland		-		-		240		-		-		240
Commercial business		5		1,357		103,439		423		1,440		101,576
Consumer		-		82		643		-		-		643
Manufactured homes		-		-		5,400		-		-		5,400
Government		-		38		21,101		-		-		21,101
Total	$	246	$	7,716	$	764,400	$	2,837	$	2,945	$	758,618

Financing Receivable Credit Quality Indicators [Table Text Block]

	Credit Exposure - Credit Risk Portfolio By Creditworthiness Category
	September 30, 2019
(Dollars in thousands)	2		3		4		5		6		7		8

Loan Segment	Moderate		Above average acceptable		Acceptable		Marginally acceptable		Pass/monitor		Special mention		Substandard		Total
Residential real estate	$	940	$	114,219	$	105,136	$	13,338	$	54,445		4,304		5,448	$	297,830
Home equity		110		7,293		39,736		253		997		810		582		49,781
Commercial real estate		2,575		2,398		85,479		129,731		56,424		4,091		1,838		282,536
Construction and land development		-		573		21,143		42,371		15,264		-		-		79,351
Multifamily		-		920		18,426		27,673		3,042		133		684		50,878
Farmland		-		-		-		-		230		-		-		230
Commercial business		8,326		19,337		20,804		35,889		20,381		2,500		2,122		109,359
Consumer		689		3		637		-		5		-		-		1,334
Manufactured homes		2,483		2,571		9,256		186		869		-		-		15,365
Government		-		1,889		12,560		3,160		-		-		-		17,609
Total	$	15,123	$	149,203	$	313,177	$	252,601	$	151,657	$	11,838	$	10,674	$	904,273

	December 31, 2018
(Dollars in thousands)	2		3		4		5		6		7		8

Loan Segment	Moderate		Above average acceptable		Acceptable		Marginally acceptable		Pass/monitor		Special mention		Substandard		Total
Residential real estate	$	261	$	58,276	$	100,374	$	10,404	$	44,734	$	3,908	$	5,366	$	223,323
Home equity		192		3,736		40,165		37		323		657		373		45,483
Commercial real estate		-		5,042		78,611		110,984		51,982		4,715		1,770		253,104
Construction and land development		-		322		24,271		29,383		10,457		-		-		64,433
Multifamily		-		569		19,255		23,417		3,844		149		-		47,234
Farmland		-		-		-		-		240		-		-		240
Commercial business		10,655		19,127		20,941		34,996		14,034		2,958		728		103,439
Consumer		202		-		441		-		-		-		-		643
Manufactured homes		723		2,953		599		196		909		20		-		5,400
Government		-		2,111		14,795		4,195		-		-		-		21,101
Total	$	12,033	$	92,136	$	299,452	$	213,612	$	126,523	$	12,407	$	8,237	$	764,400

Impaired Financing Receivables [Table Text Block]

							For the nine months ended
	As of September 30, 2019						September 30, 2019
(Dollars in thousands)	Recorded Investment		Unpaid Principal Balance		Related Allowance		Average Recorded Investment		Interest Income Recognized
With no related allowance recorded:
Residential real estate	$	2,222	$	3,697	$	-	$	1,915	$	55
Home equity		439		462		-		368		6
Commercial real estate		1,380		1,976		-		1,586		41
Construction and land development		-		-		-		-		-
Multifamily		684		766		-		525		12
Farmland		-		-		-		-		-
Commercial business		1,832		1,942		-		1,933		63
Consumer		-		-		-		-		-
Manufactured homes		-		-		-		-		-
Government		-		-		-		-		-

With an allowance recorded:
Residential real estate		153		153		17		158		3
Home equity		63		63		9		60		1
Commercial real estate		458		458		218		473		-
Construction and land development		-		-		-		-		-
Multifamily		-		-		-		-		-
Farmland		-		-		-		-		-
Commercial business		1,751		1,751		967		547		3
Consumer		-		-		-		-		-
Manufactured homes		-		-		-		-		-
Government		-		-		-		-		-

Total:
Residential real estate	$	2,375	$	3,850	$	17	$	2,073	$	58
Home equity	$	502	$	525	$	9	$	428	$	7
Commercial real estate	$	1,838	$	2,434	$	218	$	2,059	$	41
Construction & land development	$	-	$	-	$	-	$	-	$	-
Multifamily	$	684	$	766	$	-	$	525	$	12
Farmland	$	-	$	-	$	-	$	-	$	-
Commercial business	$	3,583	$	3,693	$	967	$	2,480	$	66
Consumer	$	-	$	-	$	-	$	-	$	-
Manufactured homes	$	-	$	-	$	-	$	-	$	-
Government	$	-	$	-	$	-	$	-	$	-

							For the nine months ended
	As of December 31, 2018						September 30, 2018
(Dollars in thousands)	Recorded Investment		Unpaid Principal Balance		Related Allowance		Average Recorded Investment		Interest Income Recognized
With no related allowance recorded:
Residential real estate	$	1,389	$	3,628	$	-	$	1,208	$	61
Home equity		207		214		-		87		1
Commercial real estate		1,624		2,222		-		1,114		46
Construction & land development		-		-		-		67		-
Multifamily		-		-		-		-		-
Farmland		-		-		-		-		-
Commercial business		1,799		2,038		-		651		20
Consumer		-		-		-		-		-
Manufactured homes		-		-		-		-		-
Government		-		-		-		-		-

With an allowance recorded:
Residential real estate		161		161		22		114		4
Home equity		57		57		9		29		-
Commercial real estate		481		481		210		280		3
Construction & land development		-		-		-		-		-
Multifamily		-		-		-		-		-
Farmland		-		-		-		-		-
Commercial business		64		64		5		159		1
Consumer		-		-		-		-		-
Manufactured homes		-		-		-		-		-
Government		-		-		-		-		-

Total:
Residential real estate	$	1,550	$	3,789	$	22	$	1,322	$	65
Home equity	$	264	$	271	$	9	$	116	$	1
Commercial real estate	$	2,105	$	2,703	$	210	$	1,394	$	49
Construction & land development	$	-	$	-	$	-	$	67	$	-
Multifamily	$	-	$	-	$	-	$	-	$	-
Farmland	$	-	$	-	$	-	$	-	$	-
Commercial business	$	1,863	$	2,102	$	5	$	810	$	21
Consumer	$	-	$	-	$	-	$	-	$	-
Manufactured homes	$	-	$	-	$	-	$	-	$	-
Government	$	-	$	-	$	-	$	-	$	-

Financing Receivable, Past Due [Table Text Block]

(Dollars in thousands)	30-59 Days Past Due		60-89 Days Past Due		Greater Than 90 Days Past Due		Total Past Due		Current		Total Loans		Recorded Investments Greater than 90 Days Past Due and Accruing
September 30, 2019
Residential real estate	$	2,179	$	1,716	$	4,268	$	8,163	$	289,667	$	297,830	$	318
Home equity		300		20		582		902		48,879		49,781		136
Commercial real estate		6,655		-		976		7,631		274,905		282,536		63
Construction and land development		-		299		-		299		79,052		79,351		-
Multifamily		282		133		31		446		50,432		50,878		31
Farmland		-		-		-		-		230		230		-
Commercial business		535		133		2,186		2,854		106,505		109,359		237
Consumer		-		-		-		-		1,334		1,334		-
Manufactured homes		165		128		-		293		15,072		15,365		-
Government		-		-		-		-		17,609		17,609		-
Total	$	10,116	$	2,429	$	8,043	$	20,588	$	883,685	$	904,273	$	785

December 31, 2018
Residential real estate	$	3,659	$	909	$	4,362	$	8,930	$	214,393	$	223,323	$	122
Home equity		143		5		304		452		45,031		45,483		50
Commercial real estate		842		18		611		1,471		251,633		253,104		-
Construction and land development		491		533		-		1,024		63,409		64,433		-
Multifamily		-		149		-		149		47,085		47,234		-
Farmland		-		-		-		-		240		240		-
Commercial business		733		260		436		1,429		102,010		103,439		149
Consumer		1		-		-		1		642		643		-
Manufactured homes		-		72		-		72		5,328		5,400		-
Government		-		-		-		-		21,101		21,101		-
Total	$	5,869	$	1,946	$	5,713	$	13,528	$	750,872	$	764,400	$	321

Financing Receivable, Nonaccrual [Table Text Block]

(Dollars in thousands)
	September 30, 2019		December 31, 2018
Residential real estate	$	5,132	$	5,135
Home equity		547		270
Commercial real estate		913		695
Construction and land development		-		-
Multifamily		260		-
Farmland		-		-
Commercial business		1,951		495
Consumer		-		-
Manufactured homes		-		-
Government		-		-
Total	$	8,803	$	6,595

Schedule of Accretable Yield from Financing Receivables [Table Text Block]

(dollars in thousands)	First Personal
2018	$	26
2019		118

(dollars in thousands)	First Personal
2019	$	(25	)
2020		(100	)
2021		(25	)
Total	$	(150	)

(dollars in thousands)	First Federal		Liberty Savings		First Personal		AJ Smith		Total
2018	$	105	$	200	$	114	$	-	$	419
2019		22		42		402		843	$	1,309

(dollars in thousands)	First Personal		AJ Smith		Total
2019	$	112	$	216	$	328
2020		402		833		1,236
2021		341		826		1,167
2022		330		826		1,156
2023		74		341		415
Total	$	1,259	$	3,043	$	4,303

Schedule of Financing Receivables Acquired Discount [Table Text Block]

(dollars in thousands)	First Federal				Liberty Savings				First Personal				AJ Smith
	Net fair value		Accretable period		Net fair value		Accretable period		Net fair value		Accretable period		Net fair value		Accretable period
	discount		in months		discount		in months		discount		in months		discount		in months
Residential real estate	$	1,062		59	$	1,203		44	$	948		56	$	3,734		52
Home equity		44		29		5		29		51		50		141		32
Commercial real estate		-		-		-		-		208		56		8		9
Construction and land development		-		-		-		-		1		30		-		-
Multifamily		-		-		-		-		11		48		2		48
Consumer		-		-		-		-		146		50		1		5
Commercial business		-		-		-		-		348		24		-		-
Purchased credit impaired loans		-		-		-		-		424		32		-		-
Total	$	1,106			$	1,208			$	2,137			$	3,886