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, 2020

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

(Dollars in thousands)
	September 30, 2020		December 31, 2019
Loans secured by real estate:
Residential real estate	$	284,381	$	299,569
Home equity		42,127		49,118
Commercial real estate		285,701		283,108
Construction and land development		89,176		87,710
Multifamily		50,701		51,286
Farmland		218		227
Total loans secured by real estate		752,304		771,018
Commercial business		184,406		103,222
Consumer		467		627
Manufactured homes		21,991		13,285
Government		13,205		15,804
Subtotal		972,373		903,956
Less:
Net deferred loan origination fees		3,441		2,934
Undisbursed loan funds		126		(21	)
Loans receivable	$	975,940	$	906,869

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, 2020:

Allowance for loan losses:
Residential real estate	$	1,708	$	-		$	5	$	170		$	1,883
Home equity		231		-			-		(19	)		212
Commercial real estate		3,712		-			-		675			4,387
Construction and land development		1,201		-			-		(29	)		1,172
Multifamily		609		-			-		(59	)		550
Farmland		-		-			-		-			-
Commercial business		2,375		-			-		113			2,488
Consumer		30		(9	)		3		(2	)		22
Manufactured homes		-		-			-		-			-
Government		-		-			-		-			-
Total	$	9,866	$	(9	)	$	8	$	849		$	10,714

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 nine months ended September 30, 2020:

Allowance for loan losses:
Residential real estate	$	1,812	$	(2	)	$	15	$	58		$	1,883
Home equity		223		-			-		(11	)		212
Commercial real estate		3,773		(80	)		-		694			4,387
Construction and land development		1,098		(17	)		-		91			1,172
Multifamily		529		-			-		21			550
Farmland		-		-			-		-			-
Commercial business		1,504		(78	)		17		1,045			2,488
Consumer		43		(22	)		11		(10	)		22
Manufactured homes		-		-			-		-			-
Government		17		-			-		(17	)		-
Total	$	8,999	$	(199	)	$	43	$	1,871		$	10,714

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

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, 2020:

Residential real estate	$	186	$	1,697	$	284,293	$	781		1,422	$	282,090
		1		211		42,183		222		139		41,822
Commercial real estate		683		3,704		285,701		6,242		152		279,307
Construction and land development		-		1,172		89,176		-		-		89,176
Multifamily		-		550		50,701		102		646		49,953
Farmland		-		-		218		-		-		218
Commercial business		460		2,028		182,182		1,451		1,158		179,573
Consumer		-		22		467		-		-		467
Manufactured homes		-		-		27,814		-		-		27,814
Government		-		-		13,205		-		-		13,205
Total	$	1,330	$	9,384	$	975,940	$	8,798	$	3,517	$	963,625

The Bancorp's allowance for loan losses impairment evaluation and loan receivables are summarized below at December 31, 2019:

Residential real estate	$	10	$	1,802	$	299,333	$	642	$	1,581	$	297,110
Home equity		4		219		49,181		221		216		48,744
Commercial real estate		-		3,773		283,108		1,078		487		281,543
Construction and land development		-		1,098		87,710		-		-		87,710
Multifamily		-		529		51,286		129		673		50,484
Farmland		-		-		227		-		-		227
Commercial business		152		1,352		103,088		1,041		1,150		100,897
Consumer		-		43		627		-		-		627
Manufactured homes		-		-		16,505		-		-		16,505
Government		-		17		15,804		-		-		15,804
Total	$	166	$	8,833	$	906,869	$	3,111	$	4,107	$	899,651

Financing Receivable Credit Quality Indicators [Table Text Block]

	Credit Exposure - Credit Risk Portfolio By Creditworthiness Category
	September 30, 2020
(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	$	952	$	115,720	$	100,115	$	13,601	$	44,660	$	2,555	$	6,690	$	284,293
Home equity		76		5,636		34,538		115		713		563		542		42,183
Commercial real estate		-		1,780		70,624		143,743		54,799		6,486		8,269		285,701
Construction and land development		-		2,238		26,639		45,236		15,063		-		-		89,176
Multifamily		-		723		13,364		29,548		4,971		1,567		528		50,701
Farmland		-		-		-		-		218		-		-		218
Commercial business		5,674		101,847		17,848		33,675		19,994		1,718		1,426		182,182
Consumer		63		1		403		-		-		-		-		467
Manufactured homes		5,822		1,998		19,041		178		775		-		-		27,814
Government		-		1,658		9,887		1,660		-		-		-		13,205
Total	$	12,587	$	231,601	$	292,459	$	267,756	$	141,193	$	12,889	$	17,455	$	975,940

	December 31, 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	$	827	$	119,138	$	104,153	$	13,463	$	53,058	$	4,203	$	4,491	$	299,333
Home equity		100		6,536		40,027		264		934		813		507		49,181
Commercial real estate		-		2,030		82,158		135,058		56,917		5,380		1,565		283,108
Construction and land development		-		719		26,900		45,751		14,340		-		-		87,710
Multifamily		-		903		18,107		26,800		4,674		-		802		51,286
Farmland		-		-		-		-		227		-		-		227
Commercial business		8,312		13,158		19,638		39,016		20,009		2,228		727		103,088
Consumer		90		-		537		-		-		-		-		627
Manufactured homes		3,221		2,413		9,825		184		862		-		-		16,505
Government		-		1,889		11,505		2,410		-		-		-		15,804
Total	$	12,550	$	146,786	$	312,850	$	262,946	$	151,021	$	12,624	$	8,092	$	906,869

Impaired Financing Receivables [Table Text Block]

							For the nine months ended
	As of September 30, 2020						September 30, 2020
(Dollars in thousands)	Recorded Investment		Unpaid Principal Balance		Related Allowance		Average Recorded Investment		Interest Income Recognized
With no related allowance recorded:
Residential real estate	$	1,923	$	3,260	$	-	$	2,061	$	81
Home equity		360		372		-		378		13
Commercial real estate		1,214		1,797		-		1,338		65
Construction and land development		-		-		-		-		-
Multifamily		748		830		-		775		23
Farmland		-		-		-		-		-
Commercial business		1,693		1,728		-		1,614		61
Consumer		-		-		-		-		-
Manufactured homes		-		-		-		-		-
Government		-		-		-		-		-

With an allowance recorded:
Residential real estate	$	280	$	324	$	186	$	151	$	4
Home equity		1		9		1		4		-
Commercial real estate		5,180		5,180		683		1,346		-
Construction and land development		-		-		-		-		-
Multifamily		-		-		-		-		-
Farmland		-		-		-		-		-
Commercial business		916		916		460		736		19
Consumer		-		-		-		-		-
Manufactured homes		-		-		-		-		-
Government		-		-		-		-		-

Total:
Residential real estate	$	2,203	$	3,584	$	186	$	2,212	$	85
Home equity	$	361	$	381	$	1	$	382	$	13
Commercial real estate	$	6,394	$	6,977	$	683	$	2,684	$	65
Construction & land development	$	-	$	-	$	-	$	-	$	-
Multifamily	$	748	$	830	$	-	$	775	$	23
Farmland	$	-	$	-	$	-	$	-	$	-
Commercial business	$	2,609	$	2,644	$	460	$	2,350	$	80
Consumer	$	-	$	-	$	-	$	-	$	-
Manufactured homes	$	-	$	-	$	-	$	-	$	-
Government	$	-	$	-	$	-	$	-	$	-

							For the nine months ended
	As of December 31, 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	$	2,140	$	3,555	$	-	$	1,915	$	55
Home equity		429		451		-		368		6
Commercial real estate		1,547		2,141		-		1,586		41
Construction & land development		-		-		-		-		-
Multifamily		802		884		-		525		12
Farmland		-		-		-		-		-
Commercial business		1,814		1,906		-		1,933		63
Consumer		-		-		-		-		-
Manufactured homes		-		-		-		-		-
Government		-		-		-		-		-

With an allowance recorded:
Residential real estate	$	83	$	83	$	10	$	158	$	3
Home equity		8		8		4		60		1
Commercial real estate		18		18		-		473		-
Construction & land development		-		-		-		-		-
Multifamily		-		-		-		-		-
Farmland		-		-		-		-		-
Commercial business		377		377		152		547		3
Consumer		-		-		-		-		-
Manufactured homes		-		-		-		-		-
Government		-		-		-		-		-

Total:
Residential real estate	$	2,223	$	3,638	$	10	$	2,073	$	58
Home equity	$	437	$	459	$	4	$	428	$	7
Commercial real estate	$	1,565	$	2,159	$	-	$	2,059	$	41
Construction & land development	$	-	$	-	$	-	$	-	$	-
Multifamily	$	802	$	884	$	-	$	525	$	12
Farmland	$	-	$	-	$	-	$	-	$	-
Commercial business	$	2,191	$	2,283	$	152	$	2,480	$	66
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, 2020
Residential real estate	$	2,697	$	2,028	$	3,284	$	8,009	$	276,284	$	284,293	$	-
Home equity		163		-		408		571		41,612		42,183		-
Commercial real estate		9,837		1,532		248		11,617		274,084		285,701		-
Construction and land development		478		-		345		823		88,353		89,176		345
Multifamily		102		269		166		537		50,164		50,701		-
Farmland		-		-		-		-		218		218		-
Commercial business		1,342		215		759		2,316		179,866		182,182		234
Consumer		-		-		-		-		467		467		-
Manufactured homes		423		168		-		591		27,223		27,814		-
Government		-		-		-		-		13,205		13,205		-
Total	$	15,042	$	4,212	$	5,210	$	24,464	$	951,476	$	975,940	$	579

December 31, 2019
Residential real estate	$	3,486	$	1,332	$	3,724	$	8,542	$	290,791	$	299,333	$	452
Home equity		90		24		388		502		48,679		49,181		19
Commercial real estate		1,461		170		719		2,350		280,758		283,108		61
Construction and land development		143		289		-		432		87,278		87,710		-
Multifamily		140		-		160		300		50,986		51,286		-
Farmland		-		-		-		-		227		227		-
Commercial business		926		583		870		2,379		100,709		103,088		288
Consumer		-		-		-		-		627		627		-
Manufactured homes		63		36		46		145		16,360		16,505		46
Government		-		-		-		-		15,804		15,804		-
Total	$	6,309	$	2,434	$	5,907	$	14,650	$	892,219	$	906,869	$	866

Financing Receivable, Nonaccrual [Table Text Block]

(Dollars in thousands)
	September 30, 2020		December 31, 2019
Residential real estate	$	6,650	$	4,374
Home equity		509		473
Commercial real estate		5,411		658
Construction and land development		-		-
Multifamily		528		420
Farmland		-		-
Commercial business		1,383		582
Consumer		-		-
Manufactured homes		-		-
Government		-		-
Total	$	14,481	$	6,507

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

(dollars in thousands)	First Personal
2019	$	118
2020		78

(dollars in thousands)	First Personal
2020		21
2021		21
Total	$	42

(dollars in thousands)	First Federal		Libery Savings		First Personal		AJSB		Total
2019	$	22	$	42	$	402	$	843	$	1,245
2020		-		-		416		936		1,352

(dollars in thousands)	First Personal		AJ Smith		Total
2020	$	73	$	167	$	240
2021		292		667		959
2022		282		667		949
2023		63		275		338
Total	$	710	$	1,776	$	2,486

Schedule of Financing Receivables Acquired Discount [Table Text Block]

(dollars in thousands)	First Federal				Libery Savings				First Personal				AJSB
	Net fair value discount		Accretable period in months		Net fair value discount		Accretable period in months		Net fair value discount		Accretable period in months		Net fair value discount		Accretable period 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