Total assets at June 30, 2012 decreased to $1.86 billion from $1.97 billion at December 31, 2011, primarily reflecting a $165 million decrease in security investments and a $26 million decrease in loans, partially offset by a $92 million increase in cash and short-term investments. The Bank expects to utilize a large portion of the increase in cash to fund new loans. At June 30, 2012, the Bank had $77 million of potential new real estate loans in its origination pipeline.
Securities held to maturity decreased to $535 million at June 30, 2012 from $700 million at December 31, 2011, reflecting calls of securities exceeding new purchases. A portion of the resulting proceeds was used to fund planned deposit outflow and a portion was being held temporarily in cash and short-term investments as denoted above. At June 30, 2012, the securities portfolio, which represented 29% of total assets and was comprised mostly of U.S. government agency debt ($434 million) and residential mortgage-backed pass through securities ($96 million), had a weighted-average expected yield, remaining life and remaining contractual maturity of 1.37%, 1.4 years and 7.1 years, respectively.
Loans totaled $1.14 billion at June 30, 2012, compared to $1.16 billion at December 31, 2011. The decrease reflected $97 million of payoffs, $24 million of amortization and $1.9 million of chargeoffs, partially offset by $97 million of new loans. Loans paid off had a weighted-average yield of 6.21%. New loans, nearly all with fixed interest rates, had a weighted-average yield, term and loan-to-value ratio of 4.85%, 5.4 years and 58%, respectively.
Nonaccrual loans and REO aggregated to $77 million, or 4.1% of total assets, at June 30, 2012, compared to $86 million, or 4.3%, at December 31, 2011. Nonaccrual loans totaled $51 million at June 30, 2012 and $57 million at December 31, 2011, and included $39 million (12 loans) and $46 million (12 loans) of TDRs that were current at each date, respectively. One loan ($5.5 million) was upgraded and classified as an accruing TDR in Q2-12. All the TDRs classified as nonaccrual have performed as agreed under their renegotiated terms and interest income is being recorded on a cash basis. Based on annual updated appraisals received on the underlying collateral properties, a portion of three TDRs (or $1.4 million of aggregate principal) was charged off for financial statement purposes in Q1-12. The borrowers remain obligated to pay all contractual principal due on the TDRs.
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