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Loans and Leases, and Allowance for Credit Losses | 12 Months Ended
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Dec. 31, 2024
Receivables [Abstract] |
Loans and Leases, and Allowance for Credit Losses | Loans and Leases, and Allowance for Credit Losses Peoples’ loan portfolio consists of various types of loans and leases originated primarily as a result of lending opportunities within Peoples’ footprint. Peoples also originates insurance premium finance loans nationwide through its Peoples Premium Finance division, and originates leases nationwide through its NSL division and its Vantage subsidiary. Throughout this Form 10-K, loans and leases are referred to as “total loans” and “loans held for investment.” The major classifications of loan balances (in each case, net of deferred fees and costs) excluding loans held for sale, were as follows at December 31:
(Dollars in thousands) | 2024 | 2023
Construction | $ | 328,388 |  | $ | 364,019 |
Commercial real estate, other | 2,156,013 |  | 2,196,957 |
Commercial and industrial | 1,347,645 |  | 1,184,986 |
Premium finance | 269,435 |  | 203,177 |
Leases | 406,598 |  | 414,060 |
Residential real estate | 835,101 |  | 791,095 |
Home equity lines of credit | 232,661 |  | 208,675 |
Consumer, indirect | 669,857 |  | 666,472 |
Consumer, direct | 111,052 |  | 128,769 |
Deposit account overdrafts | 1,253 |  | 986 |
Total loans, at amortized cost | $ | 6,358,003 |  | $ | 6,159,196 |
Net deferred loan origination costs were $20.2 million and $21.7 million at December 31, 2024 and 2023, respectively. The remaining unamortized net discount included in the amortized cost of loans and leases was $19.5 million and $43.0 million at December 31, 2024 and 2023, respectively. Accrued interest receivable is not included within the loan balances, but is presented in the “Other assets” line of the Consolidated Balance Sheets, with no recorded allowance for credit losses. Total interest receivable on loans was $23.1 million at December 31, 2024 and $24.5 million at December 31, 2023. Nonaccrual and Past Due Loans A loan is considered past due if any required principal and interest payments have not been received as of the date such payments were required to be made under the terms of the loan agreement. A loan may be placed on nonaccrual status regardless of whether or not such loan is considered past due. The amortized cost of loans on nonaccrual status and loans delinquent for 90 days or more and accruing were as follows at December 31:
| 2024 |  | 2023
(Dollars in thousands) | Nonaccrual (a) | Accruing Loans 90+ Days Past Due |  | Nonaccrual (a) | Accruing Loans 90+ Days Past Due
Commercial real estate, other | $ | 7,136 |  | $ | 227 |  |  | $ | 2,816 |  | $ | 78 |
Commercial and industrial | 6,809 |  | 78 |  |  | 2,758 |  | 316 |
Premium finance | — |  | 4,947 |  |  | — |  | 1,355 |
Leases | 8,850 |  | 803 |  |  | 8,436 |  | 3,826 |
Residential real estate | 7,329 |  | 2,166 |  |  | 7,921 |  | 877 |
Home equity lines of credit | 1,498 |  | 213 |  |  | 1,022 |  | 171 |
Consumer, indirect | 2,374 |  | 159 |  |  | 2,412 |  | 68 |
Consumer, direct | 133 |  | 44 |  |  | 112 |  | 25 |
Total loans, at amortized cost | $ | 34,129 |  | $ | 8,637 |  |  | $ | 25,477 |  | $ | 6,716 |
(a)There were $5.7 million of nonaccrual loans for which there was no allowance for credit losses at December 31, 2024 and $1.2 million of such loans at December 31, 2023. The following tables present the aging of the recorded investment in past due loans at December 31:
| Loans Past Due | Current | Total
(Dollars in thousands) | 30 – 59 days | 60 – 89 days | 90 + Days | Total
2024 |  |  |  |  |  |
Construction | $ | — |  | $ | — |  | $ | — |  | $ | — |  | $ | 328,388 |  | $ | 328,388 |
Commercial real estate, other | 1,300 |  | 1,585 |  | 6,008 |  | 8,893 |  | 2,147,120 |  | 2,156,013 |
Commercial and industrial | 1,651 |  | 583 |  | 4,551 |  | 6,785 |  | 1,340,860 |  | 1,347,645 |
Premium finance | 3,863 |  | 456 |  | 4,947 |  | 9,266 |  | 260,169 |  | 269,435 |
Leases | 10,941 |  | 5,241 |  | 9,575 |  | 25,757 |  | 380,841 |  | 406,598 |
Residential real estate | 11,481 |  | 3,038 |  | 5,271 |  | 19,790 |  | 815,311 |  | 835,101 |
Home equity lines of credit | 1,473 |  | 317 |  | 1,093 |  | 2,883 |  | 229,778 |  | 232,661 |
Consumer, indirect | 7,568 |  | 1,522 |  | 1,326 |  | 10,416 |  | 659,441 |  | 669,857 |
Consumer, direct | 884 |  | 113 |  | 138 |  | 1,135 |  | 109,917 |  | 111,052 |
Deposit account overdrafts | — |  | — |  | — |  | — |  | 1,253 |  | 1,253 |
Total loans, at amortized cost | $ | 39,161 |  | $ | 12,855 |  | $ | 32,909 |  | $ | 84,925 |  | $ | 6,273,078 |  | $ | 6,358,003 |
2023 |  |  |  |  |  |
Construction | $ | 13 |  | $ | 52 |  | $ | — |  | $ | 65 |  | $ | 363,954 |  | $ | 364,019 |
Commercial real estate, other | 2,728 |  | 4,556 |  | 1,572 |  | 8,856 |  | 2,188,101 |  | 2,196,957 |
Commercial and industrial | 1,717 |  | 1,491 |  | 3,052 |  | 6,260 |  | 1,178,726 |  | 1,184,986 |
Premium finance | 1,288 |  | 867 |  | 1,355 |  | 3,510 |  | 199,667 |  | 203,177 |
Leases | 12,743 |  | 4,932 |  | 12,014 |  | 29,689 |  | 384,371 |  | 414,060 |
Residential real estate | 14,021 |  | 2,733 |  | 4,481 |  | 21,235 |  | 769,860 |  | 791,095 |
Home equity lines of credit | 1,561 |  | 691 |  | 683 |  | 2,935 |  | 205,740 |  | 208,675 |
Consumer, indirect | 7,488 |  | 1,550 |  | 1,230 |  | 10,268 |  | 656,204 |  | 666,472 |
Consumer, direct | 536 |  | 282 |  | 43 |  | 861 |  | 127,908 |  | 128,769 |
Deposit account overdrafts | — |  | — |  | — |  | — |  | 986 |  | 986 |
Total loans, at amortized cost | $ | 42,095 |  | $ | 17,154 |  | $ | 24,430 |  | $ | 83,679 |  | $ | 6,075,517 |  | $ | 6,159,196 |
Delinquency trends remained stable, with 98.7% and 98.6% of Peoples’ portfolio considered “current” at December 31, 2024 and at December 31, 2023, respectively. Pledged Loans Peoples has pledged certain loans secured by one-to-four family and multifamily residential mortgages, commercial real estate and home equity lines of credit under a blanket collateral agreement to secure borrowings from the FHLB. Peoples also has pledged commercial loans to secure borrowings with the FRB. Loans pledged at December 31 are summarized in the following table:
(Dollars in thousands) | 2024 | 2023
Loans pledged to FHLB | $ | 1,218,496 |  | $ | 1,206,134 |
Loans pledged to FRB | 527,989 |  | 419,245 |
Related Party Loans In the normal course of its business, Peoples Bank has granted loans to certain directors and officers of Peoples, including their affiliates, families and entities in which they are principal owners. At December 31, 2024, no related party loan was past due 90 or more days or on nonaccrual status. Activity in related party loans is presented in the table below. Other changes primarily consist of changes in related party status, and the addition and exit of directors during the year, as applicable.
(Dollars in thousands) |
Balance, December 31, 2023 | $ | 20,166 |
New loans and disbursements | 3,527 |
Repayments | (21,159) |
Balance, December 31, 2024 | $ | 2,534 |
Quality Indicators As discussed in “Note 1 Summary of Significant Accounting Policies,” Peoples categorizes the majority of its loans into risk categories based upon an established risk grading matrix using a scale of 1 to 8. Loan grades are assigned at the time a new loan or lending commitment is extended by Peoples and may be changed at any time when circumstances warrant. Commercial loans to borrowers with an aggregate unpaid principal balance in excess of $1.0 million are reviewed at least on an annual basis for possible credit deterioration. Commercial leases, as well as loan relationships whose aggregate credit exposure to Peoples is equal to or less than $1.0 million are reviewed on an event driven basis. Triggers for review include knowledge of adverse events affecting the borrower’s business, receipt of financial statements indicating deteriorating credit quality, or other similar events. Adversely classified loans are reviewed on a quarterly basis. A description of the general characteristics of the risk grades used by Peoples follows: “Pass” (grades 1 through 4): Loans in this risk category are to borrowers of acceptable-to-strong credit quality and risk who have the apparent ability to satisfy their loan obligations. Loans in this risk category would possess sufficient mitigating factors, such as adequate collateral or strong guarantors possessing the capacity to repay the loans if required, for any weakness that may exist. “Special Mention” (grade 5): Loans in this risk category are the equivalent of the regulatory “Other Assets Especially Mentioned” classification. Loans in this risk category possess some credit deficiency or potential weakness, which requires a high level of management attention. Potential weaknesses include declining trends in operating earnings and cash flows and/or reliance on the secondary source of repayment. If left uncorrected, these potential weaknesses may result in noticeable deterioration of the repayment prospects for the loans or in Peoples’ credit position. “Substandard” (grade 6): Loans in this risk category are inadequately protected by the borrower’s current financial condition and payment capability, or by the collateral pledged, if any. Loans so classified have one or more well-defined weaknesses that jeopardize the orderly repayment of the loans. They are characterized by the distinct possibility that Peoples will sustain some loss if the deficiencies are not corrected. “Doubtful” (grade 7): Loans in this risk category have all the weaknesses inherent in those classified as substandard, with the added characteristic that the weaknesses make collection or orderly repayment in full, on the basis of current existing facts, conditions and values, highly questionable and improbable. Possibility of loss is extremely high, but because of certain important and reasonably specific factors that may work to the advantage and strengthening of the exposure, classification of these loans as an estimated loss is deferred until their more exact status may be determined. “Loss” (grade 8): Loans in this risk category are considered to be non-collectible and of such little value that their continuance as bankable assets is not warranted. This does not mean each such loan has absolutely no recovery value, but rather it is neither practical nor desirable to defer writing off the loan, even though partial recovery may be obtained in the future. Charge-offs against the allowance for credit losses are taken in the period in which the loan becomes uncollectable. Consequently, Peoples typically does not maintain a recorded investment in loans within this risk category. Consumer loans and other smaller-balance loans are evaluated and categorized as “substandard,” “doubtful” or “loss” based upon the regulatory definition of these classes and consistent with regulatory requirements. All other loans not evaluated individually, nor meeting the regulatory conditions to be categorized as described above, would be considered as being “not rated.” The following tables summarize the risk category of Peoples’ loan portfolio based upon the then most recent analysis performed at December 31, 2024:
|  | Term Loans at Amortized Cost by Origination Year |  |  |  |
(Dollars in thousands) |  | 2024 | 2023 | 2022 | 2021 | 2020 | Prior | Revolving Loans | Revolving Loans Converted to Term | Total Loans |
Construction |  |  |  |  |  |  |  |  |  |  |
Pass |  | $ | 69,862 |  | $ | 162,605 |  | $ | 47,133 |  | $ | 30,592 |  | 1,845 |  | $ | 13,540 |  | $ | — |  | $ | — |  | $ | 325,577 |  |
Special mention |  | — |  | — |  | — |  | — |  | — |  | 115 |  | — |  | — |  | 115 |  |
Substandard |  | — |  | 1,161 |  | 1,535 |  | — |  | — |  | — |  | — |  | — |  | 2,696 |  |
Total |  | 69,862 |  | 163,766 |  | 48,668 |  | 30,592 |  | 1,845 |  | 13,655 |  | — |  | — |  | 328,388 |  |
Current period gross charge-offs |  | — |  | — |  | — |  | — |  | — |  | — |  |  |  | — |  |
Commercial real estate, other |  |  |  |  |  |  |  |  |
Pass |  | 130,971 |  | 219,105 |  | 366,256 |  | 337,905 |  | 201,367 |  | 751,415 |  | 41,122 |  | — |  | 2,048,141 |  |
Special mention |  | 271 |  | 2,923 |  | 11,876 |  | 7,197 |  | 5,107 |  | 10,689 |  | 288 |  | — |  | 38,351 |  |
Substandard |  | 145 |  | 1,073 |  | 2,460 |  | 18,851 |  | 9,234 |  | 37,136 |  | 612 |  | — |  | 69,511 |  |
Doubtful |  | — |  | — |  | — |  | — |  | — |  | 10 |  | — |  | — |  | 10 |  |
Total |  | 131,387 |  | 223,101 |  | 380,592 |  | 363,953 |  | 215,708 |  | 799,250 |  | 42,022 |  | — |  | 2,156,013 |  |
Current period gross charge-offs |  | — |  | — |  | 376 |  | — |  | — |  | 55 |  |  |  | 431 |  |
Commercial and industrial |  |  |  |  |  |  |  |  |
Pass |  | 311,631 |  | 202,929 |  | 134,558 |  | 148,288 |  | 66,102 |  | 152,143 |  | 229,821 |  | 4,779 |  | 1,245,472 |  |
Special mention |  | 779 |  | 9,019 |  | 10,886 |  | 4,449 |  | 12,049 |  | 13,537 |  | 19,465 |  | — |  | 70,184 |  |
Substandard |  | 200 |  | 99 |  | 4,791 |  | 11,429 |  | 3,850 |  | 4,430 |  | 5,045 |  | 49 |  | 29,844 |  |
Doubtful |  | — |  | — |  | 1,987 |  | — |  | — |  | 158 |  | — |  | — |  | 2,145 |  |
Total |  | 312,610 |  | 212,047 |  | 152,222 |  | 164,166 |  | 82,001 |  | 170,268 |  | 254,331 |  | 4,828 |  | 1,347,645 |  |
Current period gross charge-offs |  | — |  | 14 |  | — |  | 17 |  | 105 |  | 532 |  |  |  | 668 |  |
Premium finance |  |  |  |  |  |  |  |  |  |  |
Pass |  | 265,504 |  | 3,837 |  | 94 |  | — |  | — |  | — |  | — |  | — |  | 269,435 |  |
Total |  | 265,504 |  | 3,837 |  | 94 |  | — |  | — |  | — |  | — |  | — |  | 269,435 |  |
Current period gross charge-offs |  | 67 |  | 109 |  | 33 |  | — |  | — |  | — |  |  |  | 209 |  |
Leases |  |  |  |  |  |  |  |  |  |  |
Pass |  | 175,449 |  | 125,664 |  | 61,064 |  | 24,181 |  | 4,661 |  | 2,153 |  | — |  | — |  | 393,172 |  |
Special mention |  | 791 |  | 1,529 |  | 1,140 |  | 365 |  | 5 |  | — |  | — |  | — |  | 3,830 |  |
Substandard |  | 351 |  | 2,108 |  | 1,777 |  | 193 |  | 8 |  | — |  | — |  | — |  | 4,437 |  |
Doubtful |  | 170 |  | 2,127 |  | 1,859 |  | 624 |  | 110 |  | 269 |  | — |  | — |  | 5,159 |  |
Total |  | 176,761 |  | 131,428 |  | 65,840 |  | 25,363 |  | 4,784 |  | 2,422 |  | — |  | — |  | 406,598 |  |
Current period gross charge-offs |  | 1,315 |  | 5,623 |  | 5,421 |  | 2,308 |  | 301 |  | 138 |  |  |  | 15,106 |  |
Residential real estate |  |  |  |  |  |  |  |  |
Pass |  | 77,130 |  | 66,712 |  | 85,045 |  | 128,359 |  | 52,090 |  | 414,574 |  | — |  | — |  | 823,910 |  |
Substandard |  | 321 |  | 1,088 |  | 161 |  | 980 |  | 306 |  | 8,087 |  | — |  | — |  | 10,943 |  |
Loss |  | — |  | 4 |  | — |  | — |  | — |  | 244 |  | — |  | — |  | 248 |  |
Total |  | 77,451 |  | 67,804 |  | 85,206 |  | 129,339 |  | 52,396 |  | 422,905 |  | — |  | — |  | 835,101 |  |
Current period gross charge-offs |  | — |  | — |  | 46 |  | 5 |  | — |  | 237 |  |  |  | 288 |  |
Home equity lines of credit |  |  |  |  |  |  |  |  |
Pass |  | 54,724 |  | 37,417 |  | 37,752 |  | 27,430 |  | 16,583 |  | 57,303 |  | 24 |  | 731 |  | 231,233 |  |
Substandard |  | — |  | 138 |  | 163 |  | 16 |  | 34 |  | 1,069 |  | — |  | — |  | 1,420 |  |
Loss |  | — |  | — |  | — |  | — |  | — |  | 8 |  | — |  | — |  | 8 |  |
Total |  | 54,724 |  | 37,555 |  | 37,915 |  | 27,446 |  | 16,617 |  | 58,380 |  | 24 |  | 731 |  | 232,661 |  |
Current period gross charge-offs |  | — |  | — |  | — |  | — |  | — |  | 11 |  |  |  | 11 |  |
Consumer, indirect |  |  |  |  |  |  |  |  |  |  |
Pass |  | 239,584 |  | 176,115 |  | 148,210 |  | 56,846 |  | 30,231 |  | 16,129 |  | — |  | — |  | 667,115 |  |
Substandard |  | 269 |  | 557 |  | 681 |  | 618 |  | 312 |  | 251 |  | — |  | — |  | 2,688 |  |
Loss |  | 14 |  | — |  | 16 |  | 14 |  | — |  | 10 |  | — |  | — |  | 54 |  |
Total |  | 239,867 |  | 176,672 |  | 148,907 |  | 57,478 |  | 30,543 |  | 16,390 |  | — |  | — |  | 669,857 |  |
Current period gross charge-offs |  | 497 |  | 2,207 |  | 1,880 |  | 691 |  | 141 |  | 763 |  |  |  | 6,179 |  |
Consumer, direct |  |  |  |  |  |  |  |  |  |  |
Pass |  | 45,978 |  | 25,605 |  | 21,544 |  | 9,614 |  | 4,180 |  | 3,884 |  | — |  | — |  | 110,805 |  |
Substandard |  | 18 |  | 65 |  | 46 |  | 29 |  | 4 |  | 73 |  | — |  | — |  | 235 |  |
Loss |  | — |  | 4 |  | — |  | — |  | — |  | 8 |  | — |  | — |  | 12 |  |
Total |  | 45,996 |  | 25,674 |  | 21,590 |  | 9,643 |  | 4,184 |  | 3,965 |  | — |  | — |  | 111,052 |  |
Current period gross charge-offs |  | 2 |  | 154 |  | 212 |  | 51 |  | 12 |  | 247 |  |  |  | 678 |  |
Deposit account overdrafts |  | 1,253 |  | — |  | — |  | — |  | — |  | — |  | — |  | — |  | 1,253 |  |
Current period gross charge-offs |  | 1,542 |  | — |  | — |  | — |  | — |  | — |  |  |  | 1,542 |  |
Total loans, at amortized cost |  | $ | 1,375,415 |  | $ | 1,041,884 |  | $ | 941,034 |  | $ | 807,980 |  | $ | 408,078 |  | $ | 1,487,235 |  | $ | 296,377 |  | $ | 5,559 |  | $ | 6,358,003 |  |
Total current period gross charge-offs |  | $ | 3,423 |  | $ | 8,107 |  | $ | 7,968 |  | $ | 3,072 |  | $ | 559 |  | $ | 1,983 |  |  |  | $ | 25,112 |  |
The following tables summarize the risk category of Peoples’ loan portfolio based upon the then most recent analysis performed at December 31, 2023:
| Term Loans at Amortized Cost by Origination Year |  |  |
(Dollars in thousands) | 2023 | 2022 | 2021 | 2020 | 2019 | Prior | Revolving Loans | Revolving Loans Converted to Term | Total Loans
Construction |  |  |  |  |  |  |  |  |
Pass | $ | 80,273 |  | $ | 141,245 |  | $ | 85,913 |  | $ | 27,169 |  | 9,995 |  | $ | 12,723 |  | $ | — |  | $ | — |  | $ | 357,318 |
Special mention | — |  | 3,757 |  | — |  | — |  | — |  | 123 |  | — |  | — |  | 3,880 |
Substandard | 1,200 |  | 1,590 |  | — |  | — |  | — |  | 31 |  | — |  | — |  | 2,821 |
Total | 81,473 |  | 146,592 |  | 85,913 |  | 27,169 |  | 9,995 |  | 12,877 |  | — |  | — |  | 364,019 |
Current period gross charge-offs | — |  | — |  | 9 |  | — |  | — |  | — |  |  |  | 9 |
Commercial real estate, other |  |  |  |  |  |  |  |
Pass | 199,565 |  | 327,762 |  | 366,752 |  | 227,604 |  | 262,099 |  | 650,265 |  | 37,177 |  | 189 |  | 2,071,224 |
Special mention | 999 |  | 12,975 |  | 4,850 |  | 10,324 |  | 7,074 |  | 22,186 |  | 408 |  | 41 |  | 58,816 |
Substandard | 287 |  | 2,421 |  | 5,878 |  | 8,679 |  | 1,972 |  | 47,213 |  | 457 |  | — |  | 66,907 |
Doubtful | — |  | — |  | — |  | — |  | — |  | 10 |  | — |  | — |  | 10 |
Total | 200,851 |  | 343,158 |  | 377,480 |  | 246,607 |  | 271,145 |  | 719,674 |  | 38,042 |  | 230 |  | 2,196,957 |
Current period gross charge-offs | — |  | — |  | — |  | 39 |  | — |  | 575 |  |  |  | 614 |
Commercial and industrial |  |  |  |  |  |  |  |
Pass | 225,894 |  | 180,068 |  | 212,938 |  | 86,934 |  | 55,434 |  | 132,675 |  | 213,714 |  | 38 |  | 1,107,657 |
Special mention | 540 |  | 12,051 |  | 533 |  | 9,723 |  | 4,722 |  | 6,336 |  | 16,236 |  | 8,614 |  | 50,141 |
Substandard | 78 |  | 6,441 |  | 5,104 |  | 5,617 |  | 1,602 |  | 6,278 |  | 1,889 |  | 779 |  | 27,009 |
Doubtful | — |  | — |  | — |  | — |  | — |  | 179 |  | — |  | — |  | 179 |
Total | 226,512 |  | 198,560 |  | 218,575 |  | 102,274 |  | 61,758 |  | 145,468 |  | 231,839 |  | 9,431 |  | 1,184,986 |
Current period gross charge-offs | — |  | 36 |  | 202 |  | 25 |  | 173 |  | 415 |  |  |  | 851 |
Premium finance |  |  |  |  |  |  |  |  |
Pass | 201,659 |  | 1,517 |  | 1 |  | — |  | — |  | — |  | — |  | — |  | 203,177 |
Total | 201,659 |  | 1,517 |  | 1 |  | — |  | — |  | — |  | — |  | — |  | 203,177 |
Current period gross charge-offs | 25 |  | 97 |  | — |  | — |  | — |  | — |  |  |  | 122 |
Leases |  |  |  |  |  |  |  |  |
Pass | 216,559 |  | 114,327 |  | 51,307 |  | 14,061 |  | 4,883 |  | 1,501 |  | — |  | — |  | 402,638 |
Special mention | 363 |  | 1,529 |  | 476 |  | 81 |  | 1 |  | 5 |  | — |  | — |  | 2,455 |
Substandard | 1,937 |  | 3,006 |  | 2,944 |  | 448 |  | 321 |  | 311 |  | — |  | — |  | 8,967 |
Total | 218,859 |  | 118,862 |  | 54,727 |  | 14,590 |  | 5,205 |  | 1,817 |  | — |  | — |  | 414,060 |
Current period gross charge-offs | 963 |  | 1,328 |  | 1,173 |  | 233 |  | 165 |  | 135 |  |  |  | 3,997 |
Residential real estate |  |  |  |  |  |  |  |
Pass | 75,957 |  | 91,506 |  | 140,157 |  | 58,144 |  | 45,507 |  | 369,552 |  | — |  | — |  | 780,823 |
Substandard | 43 |  | 243 |  | 585 |  | 182 |  | 529 |  | 8,604 |  | — |  | — |  | 10,186 |
Loss | — |  | — |  | — |  | — |  | — |  | 86 |  | — |  | — |  | 86 |
Total | 76,000 |  | 91,749 |  | 140,742 |  | 58,326 |  | 46,036 |  | 378,242 |  | — |  | — |  | 791,095 |
Current period gross charge-offs | — |  | — |  | — |  | — |  | — |  | 170 |  |  |  | 170 |
Home equity lines of credit |  |  |  |  |  |  |  |
Pass | 39,706 |  | 42,565 |  | 33,406 |  | 19,838 |  | 14,297 |  | 57,482 |  | 27 |  | 1,346 |  | 207,321 |
Substandard | 19 |  | — |  | 61 |  | 34 |  | 123 |  | 1,109 |  | — |  | — |  | 1,346 |
Loss | — |  | — |  | — |  | — |  | — |  | 8 |  | — |  | — |  | 8 |
Total | 39,725 |  | 42,565 |  | 33,467 |  | 19,872 |  | 14,420 |  | 58,599 |  | 27 |  | 1,346 |  | 208,675 |
Current period gross charge-offs | — |  | — |  | — |  | — |  | — |  | 110 |  |  |  | 110 |
Consumer, indirect |  |  |  |  |  |  |  |  |
Pass | 247,829 |  | 225,225 |  | 96,698 |  | 59,044 |  | 18,644 |  | 15,977 |  | — |  | — |  | 663,417 |
Substandard | 333 |  | 934 |  | 789 |  | 558 |  | 190 |  | 206 |  | — |  | — |  | 3,010 |
Loss | 7 |  | 34 |  | 2 |  | — |  | 2 |  | — |  | — |  | — |  | 45 |
Total | 248,169 |  | 226,193 |  | 97,489 |  | 59,602 |  | 18,836 |  | 16,183 |  | — |  | — |  | 666,472 |
Current period gross charge-offs | 609 |  | 2,091 |  | 865 |  | 255 |  | 63 |  | 147 |  |  |  | 4,030 |
Consumer, direct |  |  |  |  |  |  |  |  |
Pass | 58,445 |  | 37,050 |  | 17,434 |  | 8,282 |  | 3,185 |  | 4,081 |  | — |  | — |  | 128,477 |
Substandard | 55 |  | 79 |  | 47 |  | 28 |  | 30 |  | 27 |  | — |  | — |  | 266 |
Loss | — |  | — |  | — |  | — |  | — |  | 26 |  | — |  | — |  | 26 |
Total | 58,500 |  | 37,129 |  | 17,481 |  | 8,310 |  | 3,215 |  | 4,134 |  | — |  | — |  | 128,769 |
Current period gross charge-offs | 36 |  | 154 |  | 77 |  | 100 |  | 14 |  | 35 |  |  |  | 416 |
Deposit account overdrafts | 986 |  | — |  | — |  | — |  | — |  | — |  | — |  | — |  | 986 |
Current period gross charge-offs | 1,161 |  |  |  |  |  |  |  |  | 1,161 |
Total loans, at amortized cost | $ | 1,352,734 |  | $ | 1,206,325 |  | $ | 1,025,875 |  | $ | 536,750 |  | $ | 430,610 |  | $ | 1,336,994 |  | $ | 269,908 |  | $ | 11,007 |  | $ | 6,159,196 |
Total current period gross charge-offs | $ | 2,794 |  | $ | 3,706 |  | $ | 2,326 |  | $ | 652 |  | $ | 415 |  | $ | 1,587 |  |  |  | $ | 11,480 |
Collateral Dependent Loans Peoples has certain loans for which repayment is dependent upon the operation or sale of collateral, as the borrower is experiencing financial difficulty. The underlying collateral can vary based upon the type of loan. The following provides more detail about the types of collateral that secure collateral dependent loans: •Construction loans are typically secured by owner occupied commercial real estate or non-owner occupied investment real estate. Typically, owner occupied construction loans are secured by office buildings, warehouses, manufacturing facilities, and other commercial and industrial properties that are in process of construction. Non-owner occupied commercial construction loans are generally secured by office buildings and complexes, multi-family complexes, land under development, and other commercial and industrial real estate in process of construction. •Commercial real estate loans can be secured by either owner occupied commercial real estate or non-owner occupied investment commercial real estate. Typically, owner occupied commercial real estate loans are secured by office buildings, warehouses, manufacturing facilities and other commercial and industrial properties occupied by operating companies. Non-owner occupied commercial real estate loans are generally secured by office buildings and complexes, retail facilities, multifamily complexes, land under development, industrial properties, as well as other commercial or industrial real estate. •Commercial and industrial loans are generally secured by equipment, inventory, accounts receivable, and other commercial property. •Residential real estate loans are typically secured by first mortgages, and in some cases could be secured by a second mortgage, on residential real estate property. •Home equity lines of credit are generally secured by second mortgages on residential real estate property. •Consumer loans are generally secured by automobiles, motorcycles, recreational vehicles and other personal property. Some consumer loans are unsecured and have no underlying collateral. •Leases are secured by commercial equipment and other essential business assets. •Premium finance loans are secured by the unearned portion of the insurance premium being financed. The following table details Peoples’ amortized cost of collateral dependent loans as of December 31:
(Dollars in thousands) | 2024 |  | 2023
Commercial real estate, other | $ | 2,764 |  |  |  | $ | — |  |
Commercial and industrial | 959 |  |  |  | — |  |
Residential real estate | — |  |  |  | 501 |  |
Leases | 652 |  |  |  | — |  |
Total collateral dependent loans | $ | 4,375 |  |  |  | $ | 501 |  |
The increase in collateral dependent loans at December 31, 2024 compared to at December 31, 2023, was primarily due to four relationships that became collateral dependent in 2024. Modifications for Borrowers Experiencing Financial Difficulty As part of Peoples’ loss mitigation activities, Peoples may agree to modify the contractual terms of a loan to a borrower experiencing financial difficulty. The most common modifications to the contractual terms of a loan to a borrower experiencing financial difficulty include an extension of the maturity date, a reduction in the interest rate for the remaining life of the loan, a temporary period of interest-only payments, and a reduction in the contractual payment amount for either a short period or the remaining term of the loan. In addition to loan modifications, Peoples also provides other loss mitigation options, such as forbearance and repayment plans, to assist borrowers who experience financial difficulties. In assessing whether or not a borrower is experiencing financial difficulty, Peoples considers information currently available regarding the financial condition of the borrower. This information includes, but is not limited to, whether (1) the borrower is currently in payment default on any of the borrower’s debt; (2) a payment default is probable in the foreseeable future without the modification; (3) the borrower has declared or is in the process of declaring bankruptcy; and (4) the borrower’s projected cash flow is insufficient to satisfy contractual payments due under the original terms of the loan without a modification. The following table displays the amortized cost of loans that were restructured during the twelve months ended as of December 31, 2024 and December 31, 2023, presented by loan classification.
During the Twelve Months Ended December 31, 2024(a)
| Payment Delay (Only) |  |  |  |  |  |
(Dollars in thousands) | Forbearance Plan | Payment Deferral |  | Term Extension | Forbearance Plan and Term Extension | Payment Delay and Term Extension |  | Total | Percentage of Total by Loan Category(b) (c)
Commercial real estate | — |  | — |  |  | 1,021 |  | — |  | — |  |  | 1,021 |  | 0.05 | %
Commercial and industrial | — |  | — |  |  | 8,089 |  | — |  | — |  |  | 8,089 |  | 0.60 | %
Leasing | — |  | 189 |  |  | 652 |  | — |  | 1,247 |  |  | 2,088 |  | 0.51 | %
Residential real estate | — |  | — |  |  | 88 |  | — |  | — |  |  | 88 |  | 0.01 | %
Home equity lines of credit | — |  | — |  |  | 162 |  | — |  | — |  |  | 162 |  | 0.07 | %
Consumer, indirect | — |  | 13 |  |  | — |  | — |  | — |  |  | 13 |  | — | %
Total | $ | — |  | $ | 202 |  |  | $ | 10,012 |  | $ | — |  | $ | 1,247 |  |  | $ | 11,461 |  | 0.18 | %
During the Twelve Months Ended December 31, 2023(a)
| Payment Delay (Only) |  |  |  |  |  |
(Dollars in thousands) | Forbearance Plan | Payment Deferral |  | Term Extension | Forbearance Plan and Term Extension | Payment Delay and Term Extension |  | Total | Percentage of Total by Loan Category(b) (c)
Construction | $ | — |  | $ | 1,590 |  |  | $ | 52 |  | $ | — |  | $ | — |  |  | $ | 1,642 |  | 0.45 | %
Commercial real estate | 184 |  | — |  |  | 2,160 |  | — |  | — |  |  | 2,344 |  | 0.11 | %
Commercial and industrial | — |  | — |  |  | 4,110 |  | 981 |  | — |  |  | 5,091 |  | 0.43 | %
Residential real estate | — |  | — |  |  | 91 |  | — |  | — |  |  | 91 |  | 0.01 | %
Home equity lines of credit | — |  | — |  |  | 209 |  | — |  | — |  |  | 209 |  | 0.10 | %
Total | $ | 184 |  | $ | 1,590 |  |  | $ | 6,622 |  | $ | 981 |  | $ | — |  |  | $ | 9,377 |  | 0.15 | %
(a) The table presented excludes loans that were paid off or otherwise no longer included in the loan portfolio as of period end. (b) Based on the amortized cost basis as of period end, divided by the period end amortized cost basis of the corresponding class of financing receivable. (c) Each percentage displayed as --% is considered not meaningful.
The following table summarizes the financial impacts of loan modifications and payment deferrals made to loans during the twelve months ended as of December 31, 2024 and December 31, 2023, presented by loan classification.
During the Twelve Months Ended December 31, 2024
(Dollars in thousands) |  | Weighted-Average Term Extension (in months) | Average Amount Capitalized as a Result of a Payment Delay(a)
Commercial real estate |  | 6 | — |
Commercial and industrial |  | 7 | — |
Leasing |  | 26 | — |
Residential real estate |  | 1 | — |
Home equity lines of credit |  | 89 | — |
Consumer, indirect |  | 13 | — |
During the Twelve Months Ended December 31, 2023
(Dollars in thousands) |  | Weighted-Average Term Extension (in months) | Average Amount Capitalized as a Result of a Payment Delay(a)
Construction |  | 5 | $ | — |
Commercial real estate |  | 7 | — |
Commercial and industrial |  | 5 | — |
Residential real estate |  | 213 | 8,076 |
Home equity lines of credit |  | 187 | — |
Consumer, indirect |  | 2 | — |
(a) Represents the average amount of delinquency-related amounts that were capitalized as part of the loan balance. Amounts are in whole dollars.
The following table displays the amortized cost of loans that received a completed modification or payment deferral within the previous 12 months and that defaulted in the periods presented. For purposes of this disclosure, Peoples defines loans that had a payment default as loans that were 90 days or more past due following a modification through December 31, 2024 and December 31, 2023, respectively.
For the Twelve Months Ended December 31, 2024
(Dollars in thousands) | Term Extension | Payment Deferral | Payment Delay and Term Extension |  | Total
Leasing | — |  | — |  | 26 |  |  | 26 |
Residential real estate | 72 |  | — |  | — |  |  | 72 |
Consumer, indirect | — |  | 13 |  | — |  |  | 13 |
Total loans that subsequently defaulted(a) | $ | 72 |  | $ | 13 |  | $ | 26 |  |  | $ | 111 |
During the Twelve Months Ended December 31, 2023
(Dollars in thousands) | Term Extension | Payment Deferral | Payment Delay and Term Extension |  | Total
Commercial and industrial | $ | 148 |  | $ | — |  | $ | — |  |  | $ | 148 |
Consumer, indirect | 11 | — |  | — |  |  | 11 |
Total loans that subsequently defaulted(a) | $ | 159 |  | $ | — |  | $ | — |  |  | $ | 159 |
(a) Represents the sum of amortized cost and gross charge-off as of period end. Excludes loans that liquidated either through foreclosure, deed-in-lieu of foreclosure, or a short sale.
The following table displays an aging analysis of loans that were modified during the 12 months prior to the period displayed, presented by classification and class of financing receivable.
As of December 31, 2024(a)
(Dollars in thousands) | 30-59 Days Delinquent | 60-89 Days Delinquent | 90+ Days Delinquent | Total Delinquent | Current | Total
Commercial real estate | — |  | — |  | — |  | — |  | 1,021 |  | 1,021 |
Commercial and industrial | 125 |  | 18 |  | — |  | 143 |  | 7,946 |  | 8,089 |
Leasing | 143 |  | 652 |  | 26 |  | 821 |  | 1,267 |  | 2,088 |
Residential real estate | 39 |  | — |  | 33 |  | 72 |  | 16 |  | 88 |
Home equity lines of credit | — |  | — |  | — |  | — |  | 162 |  | 162 |
Consumer, indirect | — |  | — |  | 13 |  | 13 |  | — |  | 13 |
Total loans modified(b) | $ | 307 |  | $ | 670 |  | $ | 72 |  | $ | 1,049 |  | $ | 10,412 |  | $ | 11,461 |
As of December 31, 2023(a)
(Dollars in thousands) | 30-59 Days Delinquent | 60-89 Days Delinquent | 90+ Days Delinquent | Total Delinquent | Current | Total
Construction | $ | — |  | $ | 52 |  | $ | — |  | $ | 52 |  | $ | 1,590 |  | $ | 1,642 |
Commercial real estate | — |  | — |  | — |  | — |  | 2,344 |  | 2,344 |
Commercial and industrial | — |  | 750 |  | 148 |  | 898 |  | 4,193 |  | 5,091 |
Residential real estate | — |  | — |  | — |  | — |  | 91 |  | 91 |
Home equity lines of credit | — |  | — |  | — |  | — |  | 209 |  | 209 |
Total loans modified(b) | $ | — |  | $ | 802 |  | $ | 148 |  | $ | 950 |  | $ | 8,427 |  | $ | 9,377 |
(a) Amounts in table excludes loans that were paid off or otherwise no longer included in the loan portfolio as of period end. (b) Represents the amortized cost basis as of period end.
Allowance for Credit Losses As discussed in “Note 1 Summary of Significant Accounting Policies” of the Notes to the Consolidated Financial Statements included in this Form 10-K, Peoples estimates the allowance for credit losses using relevant available information, from both internal and external sources, relating to past events, current conditions, and reasonable and supportable forecasts. The allowance for credit losses represents management’s estimate of lifetime expected credit losses. Changes in the allowance for credit losses for 2024 are summarized below:
(Dollars in thousands) | Beginning Balance, January 1, 2024 | Initial Allowance for Acquired PCD Assets (a) |  | Provision for (Recovery of) Credit Losses (b) | Charge-offs | Recoveries | Ending Balance, December 31, 2024
Construction | $ | 699 |  | $ | — |  |  | $ | 179 |  | $ | — |  | $ | — |  | $ | 878 |
Commercial real estate, other | 20,915 |  | — |  |  | (4,355) |  | (431) |  | 127 |  | 16,256 |
Commercial and industrial | 10,490 |  | — |  |  | 3,403 |  | (668) |  | 58 |  | 13,283 |
Premium finance | 484 |  | — |  |  | 359 |  | (209) |  | 28 |  | 662 |
Leases | 10,850 |  | — |  |  | 16,621 |  | (15,106) |  | 528 |  | 12,893 |
Residential real estate | 5,937 |  | — |  |  | 588 |  | (288) |  | 254 |  | 6,491 |
Home equity lines of credit | 1,588 |  | — |  |  | 208 |  | (11) |  | 7 |  | 1,792 |
Consumer, indirect | 8,590 |  | — |  |  | 5,613 |  | (6,179) |  | 552 |  | 8,576 |
Consumer, direct | 2,343 |  | — |  |  | 681 |  | (678) |  | 50 |  | 2,396 |
Deposit account overdrafts | 115 |  | — |  |  | 1,263 |  | (1,542) |  | 285 |  | 121 |
Total | $ | 62,011 |  | $ | — |  |  | $ | 24,560 |  | $ | (25,112) |  | $ | 1,889 |  | $ | 63,348 |
(a) Includes purchase price adjustments related to acquisitions previously completed but were within the 12-month measurement period. (b) Amount does not include the provision for unfunded commitment liability. Changes in the allowance for credit losses for 2023 are summarized below:
(Dollars in thousands) | Beginning Balance, January 1, 2023 | Initial Allowance for Acquired PCD Assets (a) | Provision for (Recovery of) Credit Losses (b) | Charge-offs | Recoveries | Ending Balance, December 31, 2023 |
Construction | $ | 1,250 |  | $ | — |  | $ | (542) |  | $ | (9) |  | $ | — |  | 699 |  |
Commercial real estate, other | 17,710 |  | 1,340 |  | 1,514 |  | (614) |  | 965 |  | 20,915 |  |
Commercial and industrial | 8,229 |  | 379 |  | 2,181 |  | (851) |  | 552 |  | 10,490 |  |
Premium finance | 344 |  | — |  | 238 |  | (122) |  | 24 |  | 484 |  |
Leases | 8,495 |  | — |  | 5,990 |  | (3,997) |  | 362 |  | 10,850 |  |
Residential real estate | 6,357 |  | 228 |  | (670) |  | (170) |  | 192 |  | 5,937 |  |
Home equity lines of credit | 1,693 |  | 18 |  | (14) |  | (110) |  | 1 |  | 1,588 |  |
Consumer, indirect | 7,448 |  | — |  | 4,685 |  | (4,030) |  | 487 |  | 8,590 |  |
Consumer, direct | 1,575 |  | 86 |  | 1,025 |  | (416) |  | 73 |  | 2,343 |  |
Deposit account overdrafts | 61 |  | — |  | 938 |  | (1,161) |  | 277 |  | 115 |  |
Total | $ | 53,162 |  | $ | 2,051 |  | $ | 15,345 |  | $ | (11,480) |  | $ | 2,933 |  | $ | 62,011 |  |
(a) Includes purchase price adjustments related to acquisitions previously completed but were within the 12-month measurement period. (b) Amount does not include the provision for unfunded commitment liability. During 2024, Peoples recorded a total provision for credit losses of $24.6 million, which was a result of higher net charge-offs. The increase in net charge-offs was primarily driven by leases originated by NSL and totaled $14.6 million for the full year, of which $11.4 million occurred in the second half of 2024. The increase in the allowance for credit losses at December 31, 2024 when compared to at December 31, 2023 was primarily due to an increase in reserves for individually analyzed loans and leases. At December 31, 2024, Peoples had recorded an unfunded commitment liability of $2.0 million, an increase compared to the $1.8 million that was recorded at December 31, 2023. The allowance for unfunded commitments (also referred to as “unfunded commitment liability”) is presented in the “Accrued expenses and other liabilities” line of the Consolidated Balance Sheets. For 2024, Peoples recorded a provision for credit losses on unfunded commitments of $0.2 million, compared to a recovery for credit losses on unfunded commitments of $0.2 million for 2023. The change in the allowance for unfunded commitments is reflected in the “Provision for credit losses” line of the Consolidated Statements of Income.

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- Definition The entire disclosure for claims held for amounts due to entity, excluding financing receivables. Examples include, but are not limited to, trade accounts receivables, notes receivables, loans receivables. Includes disclosure for allowance for credit losses. + References Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef -Topic 310 -SubTopic 10 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/310-10/tableOfContent Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 835 -SubTopic 30 -Name Accounting Standards Codification -Section 45 -Paragraph 2 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482925/835-30-45-2 + Details
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