Quarterly report pursuant to Section 13 or 15(d)

LOANS

 v2.3.0.11
LOANS
 6 Months Ended
Jun. 30, 2011
LOANS [Abstract]  
LOANS
NOTE 3 - LOANS

The composition of the Company's loan portfolio was as follows:

(Dollars in Thousands)
  
June 30, 2011
    
December 31, 2010
  
Commercial, Financial and Agricultural
  
$
149,830
    
$
157,394
  
Real Estate-Construction
    
30,867
      
43,239
  
Real Estate-Commercial
    
660,058
      
671,702
  
Real Estate-Residential(1)
    
395,199
      
424,229
  
Real Estate-Home Equity
    
248,228
      
251,565
  
Real Estate-Loans Held-for-Sale
    
5,914
      
6,312
  
Consumer
    
197,506
      
204,230
  
Loans, Net of Unearned Interest
  
$
1,687,602
    
$
1,758,671
  

(1)  
Includes loans in process with outstanding balances of $6.3 million and $10.0 million for June 30, 2011 and December 31, 2010, respectively.

Net deferred fees included in loans at June 30, 2011 and December 31, 2010 were $1.7 million and $1.8 million, respectively.

Past Due Loans. A loan is defined as a past due loan when one full payment is past due or a contractual maturity is over 30 days past due (“DPD”).

The following table presents the aging of the recorded investment in past due loans as of June 30, 2011 and December 31, 2010 by class of loans:

June 30, 2011
(Dollars in Thousands)
30-59
DPD
60-89
DPD
90 +
DPD
Total
Past Due
Total
Current
Total
Loans
Commercial, Financial and Agricultural
$
  
754
    
208
    
-
    
962
    
147,736
  
$
149,830
Real Estate - Construction
    
140
    
-
    
-
    
140
    
29,571
    
30,867
Real Estate - Commercial Mortgage
    
3,681
    
1,217
    
-
    
4,898
    
627,931
    
660,058
Real Estate -  Residential
    
4,695
    
2,398
    
271
    
7,364
    
360,256
    
395,126
Real Estate - Home Equity
    
1,519
    
431
    
-
    
1,950
    
243,004
    
248,228
Consumer
    
2,787
    
273
    
-
    
3,060
    
196,772
    
203,493
Total Past Due Loans
$
  
13,576
    
4,527
    
271
    
18,374
    
1,605,270
  
$
1,687,602

December 31, 2010
(Dollars in Thousands)
30-59
DPD
60-89
DPD
90 +
DPD
Total
Past Due
Total
Current
Total
Loans
Commercial, Financial and Agricultural
$
  
645
    
193
    
-
    
838
    
155,497
  
$
157,394
Real Estate - Construction
    
314
    
129
    
-
    
443
    
40,890
    
43,239
Real Estate - Commercial Mortgage
    
5,577
    
840
    
-
    
6,417
    
638,411
    
671,702
Real Estate -  Residential
    
7,171
    
3,958
    
120
    
11,249
    
389,103
    
430,541
Real Estate - Home Equity
    
1,444
    
698
    
39
    
2,182
    
244,579
    
251,565
Consumer
    
2,867
    
356
    
-
    
3,223
    
200,139
    
204,230
Total Past Due Loans
$
  
18,018
    
6,174
    
159
    
24,352
    
1,668,619
  
$
1,758,671

Nonaccrual Loans.  Loans are generally placed on non-accrual status if principal or interest payments become 90 days past due and/or management deems the collectability of the principal and/or interest to be doubtful.  Loans are returned to accrual status when the principal and interest amounts contractually due are brought current or when future payments are reasonably assured.

The following table presents the recorded investment in nonaccrual loans and loans past due over 90 days and still on accrual by class of loans as of June 30, 2011 and December 31, 2010:

   
June 30, 2011
    
December 31, 2010
(Dollars in Thousands)
  
Nonaccrual
    
90 + DPD
    
Nonaccrual
      
90+ DPD
  
 
Commercial, Financial and Agricultural
   $ 1,133      $ -     $ 1,059     $ -  
Real Estate - Construction
     1,156       -       1,907       -  
Real Estate - Commercial Mortgage
     27,229       -       26,874       -  
Real Estate -  Residential
     27,505       271       30,189       120  
Real Estate - Home Equity
     3,275       -       4,803       39  
Consumer
     778       -       868       -  
Total Nonaccrual Loans
   $ 61,076      $ 271     $ 65,700     $ 159  

Credit Quality Indicators. As part of the ongoing monitoring of the Company’s loan portfolio quality, management categorizes loans into risk categories based on relevant information about the ability of borrowers to service their debt such as: current financial information, historical payment performance, credit documentation, and current economic/market trends, among other factors.  Risk ratings are assigned to each loan and revised as needed through established monitoring procedures for individual loan relationships over a predetermined amount and review of smaller balance homogenous loan pools.  The Company uses the following definitions for the categorizing and managing its problem loans.

Special Mention – Loans in this category are presently protected from loss, but weaknesses are apparent which, if not corrected, could cause future problems.  Adverse economic or market conditions may negatively impact the borrower’s ability to repay.  Loans in this category may not meet required underwriting criteria and have no mitigating factors.  More than the ordinary amount of attention is warranted for these loans.

Substandard – Loans in this category exhibit well-defined weaknesses that would typically bring normal repayment into jeopardy. These loans are no longer adequately protected due to well-defined weaknesses that affect the repayment capacity of the borrower.  The possibility of loss is much more evident and above average supervision is required for these loans.

Nonaccrual – Loans in this category are on nonaccrual status due to the borrower’s inability to meet the repayment terms and where future capacity to repay is remote.

The following table presents the risk category of loans by segment as of June 30, 2011 and December 31, 2010:

 
 June 30, 2011
(Dollars in Thousands)
  
Commercial,
Financial,
Agriculture
    
 
Real Estate
    
 
Consumer
    
 
Total
  
Special Mention
   $ 9,165     $ 94,141     $ 116     $ 103,422  
Substandard
     8,627       152,207       623       161,457  
Nonaccrual
     1,133       59,165       778       61,076  
Total Loans
   $ 18,925     $ 305,513     $ 1,517     $ 325,955  

December 31, 2010
(Dollars in Thousands)
  
Commercial,
Financial,
 Agriculture
    
 
Real Estate
    
 
Consumer
    
 
Total
  
Special Mention
   $ 20,539     $ 100,008     $ 102     $ 120,649  
Substandard
     10,599       165,143       719       176,461  
Nonaccrual
     1,060       63,773       867       65,700  
Total Loans
   $ 32,198     $ 328,924     $ 1,688     $ 362,810