the result of foreclosure on loans that were non-performing at December 31, 2009. The increase was primarily the result of  the foreclosure on a residential subdivision development as the Company took possession of the real estate after the  development slowed and the borrower was unable to comply with the contractual terms of the loan and a loan settlement  where the Company took possession of a commercial real estate building. As part of the Company’s credit risk  management, the Company continues to aggressively manage the loan portfolio to identify problem loans and has placed  additional emphasis on its commercial real estate relationships. As discussed in more detail in the “Asset Quality and  Distribution” section, the Company believes its allowance for loan losses is adequate based on the evaluation of the loan  portfolio’s inherent risk as of December 31, 2012.  The following table sets forth information with respect to the Company’s allowance for loan losses at the dates  indicated:  IV. Summary of Loan Loss Experience 2012 2011 2010 2009 2008 Balances at beginning of year  $ 4,707 $ 4,967 $ 5,468 $ 3,871 $ 4,172  Provision for loan losses 1,900 2,000 5,900 3,300 2,400  Charge-offs: One-to-four family residential real estate (70) (110) (387) (153) (1,439) Construction and land (1,749) (1,173) (3,474) (330) (453) Commercial real estate - (434) (96) (17) - Commercial loans (70) (590) (8) (1,404) (728) Agriculture loans - (1) (2,327) - - Consumer loans (238) (132) (178) (122) (149) Total charge-offs (2,127) (2,440) (6,470) (2,026) (2,769) Recoveries: One-to-four family residential real estate 20 41 10 6 2  Construction and land 4 4  - 200  - Commercial real estate - 37  - - - Commercial loans 12 14 17 72 9  Agriculture loans 39 35 10  - - Consumer loans 26 49 32 45 57  Total recoveries 101 180 69 323 68  Net charge-offs (2,026) (2,260) (6,401) (1,703) (2,701) Balances at end of year  $ 4,581 $ 4,707 $ 4,967 $ 5,468 $ 3,871  Allowance for loan losses as a percent  of total gross loans outstanding 1.43% 1.50% 1.60% 1.57% 1.05% Net loans charged off as a percent of  average net loans outstanding  0.66% 0.74% 1.93% 0.48% 0.72% As of December 31, (Dollars in thousands) During 2012, we had net loan charge-offs of $2.0 million compared to $2.3 million during 2011. The net loan  charge-offs in 2012 were primarily associated with two land loans that were the subject of troubled debt restructurings,  resulting in charge-offs to reduce the loans down to the market value of the collateral. The net loan charge-offs in 2011  were primarily related to a previously identified and impaired construction loan totaling $4.3 million, which had previously  experienced a significant decline in the appraised value of the collateral securing the loan. Due to additional delays  associated with the litigation to collect payment from the guarantor, we charged-off the remaining $1.0 million balance on  this loan in 2011. We continue to pursue recovery from the guarantor of this loan. In addition to the charge-off of the  construction loan, the 2011 period also reflects a charge-off related to a previously identified and impaired commercial  relationship consisting of $2.0 million in real estate and operating loans, which were charged down to market value after we  30 