HVBC 2016 Annual Report

12 Non-Performing Assets. The following table sets forth the amounts and categories of our non-performing assets at the dates indicated. We had no accruing loans past due 90 days or more at June 30, 2017, 2016 or 2015. Additionally, we had no non-accruing troubled debt restructurings at June 30, 2017, 2016 or 2015. At June 30, 2017 2016 2015 (Dollars in thousands) Non-accrual loans: Residential: One- to four-family $ 1,198 $ 818 $ 1,277 Home equity & HELOCs 110 227 147 Commercial real estate 100 100 226 Commercial business — — — Construction — — — Consumer — — — Total non-accrual loans 1,408 1,145 1,650 Total non-performing loans 1,408 1,145 1,650 Real estate owned — 115 574 Other non-performing assets — — — Total non-performing assets $ 1,408 $ 1,260 $ 2,224 Ratios: Total non-performing loans to total loans 1.26% 1.23% 1.97% Total non-performing loans to total assets 0.65% 0.63% 0.99% Total non-performing assets to total assets 0.65% 0.69% 1.33% Non-performing loans increased to $1.4 million, or 1.26% of total loans, at June 30, 2017 from $1.1 million, or 1.23% of total loans, at June 30, 2016. This increase was due primarily to a $380,000 increase in non-performing one- to four-family residential real estate loans. Non-performing one- to four-family residential real estate loans totaled $1.2 million at June 30, 2017. Non-performing home equity loans and home equity lines of credit totaled $110,000 at June 30, 2017. Non-performing commercial real estate loans totaled $100,000 at June 30, 2017. Classified Assets . Federal regulations provide for the classification of loans and other assets, such as debt and equity securities considered by the FDIC to be of lesser quality, as “substandard,” “doubtful” or “loss.” An asset is considered “substandard” if it is inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged, if any. “Substandard” assets include those characterized by the “distinct possibility” that the insured institution will sustain “some loss” if the deficiencies are not corrected. Assets classified as “doubtful” have all of the weaknesses inherent in those classified “substandard,” with the added characteristic that the weaknesses present make “collection or liquidation in full,” on the basis of currently existing facts, conditions, and values, “highly questionable and improbable.” Assets classified as “loss” are those considered “uncollectible” and of such little value that their continuance as assets without the establishment of a specific allowance for loan losses is not warranted. Assets that do not currently expose the insured institution to sufficient risk to warrant classification in one of the aforementioned categories but possess weaknesses are designated as “special mention” by our management. At June 30, 2017, we had $552,000 of loans designated as “special mention.”