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LOANS AND ALLOWANCE FOR LOAN LOSSES (Tables)
 12 Months Ended
Dec. 31, 2022
Receivables [Abstract]  
Summary of Loan Portfolio, Excluding Residential Loans Held for Sale
The following table presents the loan portfolio by segment and class, excluding residential LHFS, at December 31, 2022 and 2021.
20222021
Commercial real estate:
Owner-occupied$315,770 $238,668 
Non-owner occupied608,043 551,783 
Multi-family138,832 93,255 
Non-owner occupied residential104,604 106,112 
Acquisition and development:
1-4 family residential construction25,068 12,279 
Commercial and land development158,308 93,925 
Commercial and industrial (1)
357,774 485,728 
Municipal12,173 14,989 
Residential mortgage:
First lien229,849 198,831 
Home equity – term5,505 6,081 
Home equity – lines of credit183,241 160,705 
Installment and other loans12,065 17,630 
Total loans$2,151,232 $1,979,986 
(1) This balance includes $13.8 million and $189.9 million of SBA PPP loans, net of deferred fees and costs, at December 31, 2022 and 2021, respectively.
Summary of Ratings Based on Internal Risk Rating System The following summarizes the Company’s loan portfolio ratings based on its internal risk rating system at December 31, 2022 and 2021:
Pass
Special
Mention
Non-Impaired
Substandard
Impaired -
Substandard
DoubtfulPCI LoansTotal
December 31, 2022
Commercial real estate:
Owner-occupied$305,159 $2,109 $3,532 $2,767 $— $2,203 $315,770 
Non-owner occupied601,244 4,243 2,273 — — 283 608,043 
Multi-family130,851 7,739 242 — — — 138,832 
Non-owner occupied residential102,674 810 482 81 — 557 104,604 
Acquisition and development:
1-4 family residential construction25,068 — — — — — 25,068 
Commercial and land development142,424 458 — 15,426 — — 158,308 
Commercial and industrial331,103 17,579 7,013 31 — 2,048 357,774 
Municipal12,173 — — — — — 12,173 
Residential mortgage:
First lien222,849 — 215 2,520 — 4,265 229,849 
Home equity – term5,485 — — 5 — 15 5,505 
Home equity – lines of credit182,801 — 45 395 — — 183,241 
Installment and other loans12,017 — — 40 — 8 12,065 
$2,073,848 $32,938 $13,802 $21,265 $— $9,379 $2,151,232 
December 31, 2021
Commercial real estate:
Owner-occupied$219,250 $7,239 $6,087 $3,763 $— $2,329 $238,668 
Non-owner occupied528,010 23,297 166 — — 310 551,783 
Multi-family84,414 8,238 603 — — — 93,255 
Non-owner occupied residential102,588 1,065 1,153 122 — 1,184 106,112 
Acquisition and development:
1-4 family residential construction
12,279 — — — — — 12,279 
Commercial and land development92,049 1,385 491 — — — 93,925 
Commercial and industrial470,579 7,917 4,720 250 — 2,262 485,728 
Municipal14,989 — — — — — 14,989 
Residential mortgage:
First lien191,386 — 225 2,635 — 4,585 198,831 
Home equity – term6,058 — — 7 — 16 6,081 
Home equity – lines of credit160,203 20 46 436 — — 160,705 
Installment and other loans17,584 — — 40 — 6 17,630 
$1,899,389 $49,161 $13,491 $7,253 $— $10,692 $1,979,986 
Summary of Impaired Loans by Class
The following table, which excludes accruing PCI loans, summarizes impaired loans by segment and class, segregated by those for which a specific allowance was required and those for which a specific allowance was not required at December 31, 2022 and 2021. The recorded investment in loans excludes accrued interest receivable due to insignificance. Related allowances established generally pertain to those loans in which loan forbearance agreements were in the process of being negotiated or updated appraisals were pending and any partial charge-off will be recorded when final information is received.
 
 Impaired Loans with a Specific AllowanceImpaired Loans with No Specific Allowance
Recorded
Investment
(Book Balance)
Unpaid
Principal Balance
(Legal Balance)
Related
Allowance
Recorded
Investment
(Book Balance)
Unpaid
Principal Balance
(Legal Balance)
December 31, 2022
Commercial real estate:
Owner-occupied$— $— $— $2,767 $3,799 
Non-owner occupied residential— — — 81 207 
Acquisition and development:
Commercial and land development— — — 15,426 15,426 
Commercial and industrial— — — 31 112 
Residential mortgage:
First lien178 178 28 2,342 3,126 
Home equity—term— — — 5 8 
Home equity—lines of credit— — — 395 684 
Installment and other loans— — — 40 40 
$178 $178 $28 $21,087 $23,402 
December 31, 2021
Commercial real estate:
Owner-occupied$— $— $— $3,763 $4,902 
Non-owner occupied residential— — — 122 259 
Commercial and industrial— — — 250 547 
Residential mortgage:
First lien341 341 28 2,294 3,337 
Home equity—term— — — 7 10 
Home equity—lines of credit— — — 436 653 
Installment and other loans— — — 40 40 
$341 $341 $28 $6,912 $9,748 
Summary of Average Recorded Investment in Impaired Loans and Related Interest Income The following table, which excludes accruing PCI loans, summarizes the average recorded investment in impaired loans and related recognized interest income for the years ended December 31, 2022, 2021 and 2020.
 202220212020
Average
Impaired
Balance
Interest
Income
Recognized
Average
Impaired
Balance
Interest
Income
Recognized
Average
Impaired
Balance
Interest
Income
Recognized
Commercial real estate:
Owner-occupied$3,050 $— $3,825 $1 $4,636 $1 
Non-owner occupied— — — — 83 — 
Multi-family— — — — 205 — 
Non-owner occupied residential96 — 225 — 388 — 
Acquisition and development:
Commercial and land development1,187 — 187 — 641 — 
Commercial and industrial109 — 3,030 — 1,196 — 
Residential mortgage:
First lien2,389 33 2,539 43 2,995 48 
Home equity – term6 — 11 — 11 — 
Home equity – lines of credit405 — 521 — 692 1 
Installment and other loans44 — 25 — 25 — 
$7,286 $33 $10,363 $44 $10,872 $50 
Schedule of Impaired Loans that are TDRs
The following table presents impaired loans that are TDRs, with the recorded investment at December 31, 2022 and 2021.
 
 20222021
Number of
Contracts
Recorded
Investment
Number of
Contracts
Recorded
Investment
Accruing:
Residential mortgage:
First lien8 682 8 804 
8 682 8 804 
Nonaccruing:
Residential mortgage:
First lien4 212 5 285 
Installment and other loans1 2 — — 
5 214 5 285 
13 $896 13 $1,089 
Schedule of Number of Loans Modified
The following table presents the number of loans modified as TDRs, and their pre-modification and post-modification investment balances for the year ended December 31, 2022. There were two new TDRs, both on non-accrual status for the year ended December 31, 2022. During 2022, one of the two new TDRs was paid off in full. There were no loans modified as TDRs during 2021 and 2020.
The loan presented in the table below was considered a TDR as a result of the Company agreeing to a below market interest rate given the risk of the transaction and a term extension, in order to give the borrowers an opportunity to improve their cash flows. For new and accruing TDRs, impairment is generally assessed using a discounted cash flow analysis. For TDRs in default of their modified terms, impairment is generally determined on a collateral dependent approach.
Number of
Contracts
Pre-
Modification
Investment
Balance
Post-
Modification
Investment
Balance
December 31, 2022
Installment and other loans1 $5 $2 
Schedule of Classes of Loan Portfolio Summarized by Aging Categories The following table presents the classes of the loan portfolio summarized by aging categories of performing loans and nonaccrual loans at December 31, 2022 and 2021.
  Days Past Due   
Current30-5960-89
90+
(still accruing)
Total
Past Due
Non-
Accrual
Total
Loans
December 31, 2022
Commercial real estate:
Owner-occupied$310,769 $31 $— $— $31 $2,767 $313,567 
Non-owner occupied607,760 — — — — — 607,760 
Multi-family138,832 — — — — — 138,832 
Non-owner occupied residential103,782 184 — — 184 81 104,047 
Acquisition and development:
1-4 family residential construction24,622 446 — — 446 — 25,068 
Commercial and land development142,613 269 — — 269 15,426 158,308 
Commercial and industrial355,179 464 52 — 516 31 355,726 
Municipal12,173 — — — — — 12,173 
Residential mortgage:
First lien219,715 3,485 414 132 4,031 1,838 225,584 
Home equity – term5,485 — — — — 5 5,490 
Home equity – lines of credit181,350 1,395 101 — 1,496 395 183,241 
Installment and other loans11,953 64 — — 64 40 12,057 
Subtotal2,114,233 6,338 567 132 7,037 20,583 2,141,853 
Loans acquired with credit deterioration:
Commercial real estate:
Owner-occupied2,203 — — — — — 2,203 
Non-owner occupied283 — — — — — 283 
Non-owner occupied residential
452 — — 105 105 — 557 
Commercial and industrial2,048 — — — — — 2,048 
Residential mortgage:
First lien3,657 327 79 202 608 — 4,265 
Home equity – term15 — — — — — 15 
Installment and other loans8 — — — — — 8 
Subtotal8,666 327 79 307 713 — 9,379 
$2,122,899 $6,665 $646 $439 $7,750 $20,583 $2,151,232 
Days Past Due
Current30-5960-89
90+
(still accruing)
Total
Past Due
Non-
Accrual
Total
Loans
December 31, 2021
Commercial real estate:
Owner-occupied$231,371 $314 $— $891 $1,205 $3,763 $236,339 
Non-owner occupied551,473 — — — — — 551,473 
Multi-family93,255 — — — — — 93,255 
Non-owner occupied residential104,645 161 — — 161 122 104,928 
Acquisition and development:
1-4 family residential construction12,279 — — — — — 12,279 
Commercial and land development93,793 132 — — 132 — 93,925 
Commercial and industrial483,088 128 — — 128 250 483,466 
Municipal14,989 — — — — — 14,989 
Residential mortgage:
First lien189,043 2,995 281 96 3,372 1,831 194,246 
Home equity – term6,042 16 — — 16 7 6,065 
Home equity – lines of credit159,628 641 — — 641 436 160,705 
Installment and other loans17,467 109 8 — 117 40 17,624 
Subtotal1,957,073 4,496 289 987 5,772 6,449 1,969,294 
Loans acquired with credit deterioration:
Commercial real estate:
Owner-occupied2,329 — — — — — 2,329 
Non-owner occupied310 — — — — — 310 
Non-owner occupied residential479 — 587 118 705 — 1,184 
Commercial and industrial2,262 — — — — — 2,262 
Residential mortgage:
First lien3,937 387 166 95 648 — 4,585 
Home equity – term15 — — 1 1 — 16 
Installment and other loans6 — — — — — 6 
Subtotal9,338 387 753 214 1,354 — 10,692 
$1,966,411 $4,883 $1,042 $1,201 $7,126 $6,449 $1,979,986 
Schedule of Activity in Allowance for Loan Losses
The following table presents activity in the ALL for the years ended December 31, 2022, 2021 and 2020.
 CommercialConsumer  
Commercial
Real Estate
Acquisition
and
Development
Commercial
and
Industrial
MunicipalTotal
Residential
Mortgage
Installment
and Other
TotalUnallocatedTotal
December 31, 2022
Balance, beginning of year
$12,037 $2,062 $3,814 $30 $17,943 $2,785 $215 $3,000 $237 $21,180 
Provision for loan losses1,489 1,142 640 (6)3,265 669 218 887 8 4,160 
Charge-offs— — — — — (50)(360)(410)— (410)
Recoveries32 10 51 — 93 40 115 155 — 248 
Balance, end of year
$13,558 $3,214 $4,505 $24 $21,301 $3,444 $188 $3,632 $245 $25,178 
December 31, 2021
Balance, beginning of year
$11,151 $1,114 $3,942 $40 $16,247 $3,362 $324 $3,686 $218 $20,151 
Provision for loan losses710 938 23 (10)1,661 (517)(73)(590)19 1,090 
Charge-offs(293)— (663)— (956)(92)(70)(162)— (1,118)
Recoveries469 10 512 — 991 32 34 66 — 1,057 
Balance, end of year
$12,037 $2,062 $3,814 $30 $17,943 $2,785 $215 $3,000 $237 $21,180 
December 31, 2020
Balance, beginning of year
$7,634 $959 $2,356 $100 $11,049 $3,147 $319 $3,466 $140 $14,655 
Provision for loan losses2,745 146 2,096 (60)4,927 203 117 320 78 5,325 
Charge-offs(3)— (748)— (751)(114)(146)(260)— (1,011)
Recoveries775 9 238 — 1,022 126 34 160 — 1,182 
Balance, end of year
$11,151 $1,114 $3,942 $40 $16,247 $3,362 $324 $3,686 $218 $20,151 
Summary of Ending Loan Balance Individually Evaluated for Impairment The following table summarizes the ending loan balances individually evaluated for impairment based upon loan segment, as well as the related ALL loss allocation for each at December 31, 2022 and 2021. Accruing PCI loans are excluded from loans individually evaluated for impairment.
 CommercialConsumer  
Commercial
Real Estate
Acquisition
and
Development
Commercial
and
Industrial
MunicipalTotal
Residential
Mortgage
Installment
and Other
TotalUnallocatedTotal
December 31, 2022
Loans allocated by:
Individually evaluated for impairment
$2,848 $15,426 $31 $— $18,305 $2,920 $40 $2,960 $— $21,265 
Collectively evaluated for impairment
1,164,401 167,950 357,743 12,173 1,702,267 415,675 12,025 427,700 — 2,129,967 
$1,167,249 $183,376 $357,774 $12,173 $1,720,572 $418,595 $12,065 $430,660 $— $2,151,232 
Allowance for loan losses allocated by:
Individually evaluated for impairment
$— $— $— $— $— $28 $— $28 $— $28 
Collectively evaluated for impairment
13,558 3,214 4,505 24 21,301 3,416 188 3,604 245 25,150 
$13,558 $3,214 $4,505 $24 $21,301 $3,444 $188 $3,632 $245 $25,178 
December 31, 2021
Loans allocated by:
Individually evaluated for impairment
$3,885 $— $250 $— $4,135 $3,078 $40 $3,118 $— $7,253 
Collectively evaluated for impairment
985,933 106,204 485,478 14,989 1,592,604 362,539 17,590 380,129 — 1,972,733 
$989,818 $106,204 $485,728 $14,989 $1,596,739 $365,617 $17,630 $383,247 $— $1,979,986 
Allowance for loan losses allocated by:
Individually evaluated for impairment
$— $— $— $— $— $28 $— $28 $— $28 
Collectively evaluated for impairment
12,037 2,062 3,814 30 17,943 2,757 215 2,972 237 21,152 
$12,037 $2,062 $3,814 $30 $17,943 $2,785 $215 $3,000 $237 $21,180 
Schedule of Activity for the Accretable Yield of Purchased Impaired Loans The following table provides activity for the accretable yield of purchased impaired loans for the years ended December 31, 2022 and 2021.
20222021
Accretable yield, beginning of period$2,661 $3,438 
Accretion of income(949)(1,093)
Reclassifications from nonaccretable difference due to improvement in expected cash flows388 160 
Other changes, net335 156 
Accretable yield, end of period$2,435 $2,661