Risk Assets
Components of Risk Assets
(dollars in thousands)
As of December 31
2018 2017 2016
$7,850
1,151
-- $8,751
1,310
-- $5,906
1,483
--
Total risk loans
Other property owned 9,001
258 10,061
-- 7,389
1,067
Total risk assets $9,259 $10,061 $8,456
0.2%
0.2%
91.8%
0.1% 0.3%
0.2%
69.3%
0.1% 0.2%
0.2%
85.6%
0.1%
Loans:
Nonaccrual
Accruing restructured
Accruing loans 90 days or more past due
Total risk loans as a percentage of total loans
Nonaccrual loans as a percentage of total loans
Current nonaccrual loans as a percentage of total nonaccrual loans
Total delinquencies as a percentage of total loans
Note: Accruing loans include accrued interest receivable.
Our risk assets have decreased from December 31, 2017, and have remained at acceptable levels. Total risk loans as a percentage of total loans were well
within our established risk management guidelines.
Nonaccrual loans remained at an acceptable level at December 31, 2018, 2017, and 2016.
Allowance for Loan Losses
The allowance for loan losses is an estimate of inherent losses on loans in our portfolio as of the financial statement date. We determine the appropriate
level of allowance for loan losses based on the periodic evaluation of factors such as loan loss history, estimated probability of default, estimated loss
severity, portfolio quality, and current economic and environmental conditions.
Allowance Coverage Ratios
2018 2017 2016
0.4%
203.4%
177.4%
(0.0%)
10.8% 0.4%
181.9%
158.2%
0.0%
13.6% 0.4%
278.2%
222.3%
0.0%
13.0%
As of December 31
Allowance as a percentage of:
Loans
Nonaccrual loans
Total risk loans
Net (recoveries) charge-offs as a percentage of average loans
Adverse assets to risk funds
Note: Risk funds includes permanent capital and allowance for loan losses.
In our opinion, the allowance for loan losses was reasonable in relation to the risk in our loan portfolio at December 31, 2018.
Additional loan information is included in Notes 3, 10, 11, and 12 to the accompanying Consolidated Financial Statements.
RESULTS OF OPERATIONS
Profitability Information
(dollars in thousands)
For the year ended December 31
Net income
Return on average assets
Return on average members' equity
Changes in the chart above relate directly to:
Changes in income discussed below
Changes in assets discussed in the Loan Portfolio section
Changes in capital discussed in the Capital Adequacy section
5
2018 2017 2016
$81,721
2.0%
9.9% $70,142
1.8%
9.0% $61,566
1.7%
8.4%