What are Fidelity D And D Bancorp Inc's Business Segments?
Commercial and industrial loans (C&I): C&I loans are primarily based on
the identified historic and/or the projected cash flows of the borrower and secondarily
on the underlying collateral provided by the borrower. The cash flows of the borrower,
however, do fluctuate based on changes in the Company’s internal and external
environment including management, human and capital resources, economic conditions,
competition and regulation. Most C&I loans are secured by business assets
being financed such as equipment, accounts receivable, and/or inventory and generally
incorporate a secured or unsecured personal guarantee. Unsecured loans may be
made on a short-term basis. The ability of the borrower to collect amounts due
from its customers may be affected by its customers’ economic and financial
condition.
Commercial real estate loans: Commercial real estate loans are made to finance
the purchase of real estate, refinance existing obligations and/or to provide
capital. These commercial real estate loans are generally secured by first lien
security interests in the real estate as well as assignment of leases and rents.
The real estate may include apartments, hotels, retail stores or plazas and
healthcare facilities whether they are owner or non-owner occupied. These loans
are typically originated in amounts of no more than 80% of the appraised value
of the property.
Consumer loans: The Company offers home equity installment loans and lines
of credit. Risks associated with loans secured by residential properties are
generally lower than commercial real estate loans and include general economic
risks, such as the strength of the job market, employment stability and the
strength of the housing market. Since most loans are secured by a primary or
secondary residence, the borrower’s continued employment is considered
the greatest risk to repayment. The Company also offers a variety of loans to
individuals for personal and household purposes. These loans are generally considered
to have greater risk than mortgages on real estate because they may be unsecured,
or if they are secured, the value of the collateral may be difficult to assess
and more likely to decrease in value than real estate.
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