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Loans (Tables)

9 Months Ended

Sep. 30, 2023

Loans and Leases Receivable Disclosure [Abstract]

The Company’s loan portfolio consisted of the following as of the dates indicated (in thousands):


		Principal Amount Outstanding				Net Deferred Loan (Fees) Costs				Loans, Net
September 30, 2023
Commercial business		$	710,795			$	743			$	711,538
Commercial mortgage			1,989,357				(4,078	)			1,985,279
Residential real estate loans			621,913				13,296				635,209
Residential real estate lines			73,341				3,381				76,722
Consumer indirect			947,035				35,102				982,137
Other consumer			40,319				(38	)			40,281
Total		$	4,382,760			$	48,406				4,431,166
Allowance for credit losses – loans											(49,630	)
Total loans, net										$	4,381,536
December 31, 2022
Commercial business		$	663,611			$	638			$	664,249
Commercial mortgage			1,683,814				(3,974	)			1,679,840
Residential real estate loans			576,279				13,681				589,960
Residential real estate lines			74,432				3,238				77,670
Consumer indirect			985,580				38,040				1,023,620
Other consumer			15,002				108				15,110
Total		$	3,998,718			$	51,731				4,050,449
Allowance for credit losses – loans											(45,413	)
Total loans, net										$	4,005,036

Recorded Investment by Loan Class in Current and Nonaccrual Loans

The Company’s recorded investment, by loan class, in current and nonaccrual loans, as well as an analysis of accruing delinquent loans is set forth as of the dates indicated (in thousands):


		30-59 Days Past Due				60-89 Days Past Due				Greater Than 90 Days				Total Past Due				Nonaccrual				Current				Total Loans				Nonaccrual with no allowance
September 30, 2023
Commercial business		$	30			$	56			$	—			$	86			$	254			$	710,455			$	710,795			$	169
Commercial mortgage			8,685				3,014				—				11,699				686				1,976,972				1,989,357				686
Residential real estate loans			2,237				—				—				2,237				4,992				614,684				621,913				4,992
Residential real estate lines			64				—				—				64				201				73,076				73,341				201
Consumer indirect			11,290				2,893				—				14,183				3,382				929,470				947,035				3,382
Other consumer			74				1				6				81				—				40,238				40,319				—
Total loans, gross		$	22,380			$	5,964			$	6			$	28,350			$	9,515			$	4,344,895			$	4,382,760			$	9,430
December 31, 2022
Commercial business		$	176			$	10			$	—			$	186			$	340			$	663,085			$	663,611			$	233
Commercial mortgage			—				—				—				—				2,564				1,681,250				1,683,814				659
Residential real estate loans			1,306				28				—				1,334				4,071				570,874				576,279				4,071
Residential real estate lines			264				102				—				366				142				73,924				74,432				142
Consumer indirect			12,637				2,073				—				14,710				3,079				967,791				985,580				3,079
Other consumer			111				1				1				113				1				14,888				15,002				1
Total loans, gross		$	14,494			$	2,214			$	1			$	16,709			$	10,197			$	3,971,812			$	3,998,718			$	8,185

Amortized Cost basis of Loans Modified to Borrowers Experiencing Financial Difficulty

The following table presents the amortized cost basis of loans modified to borrowers experiencing financial difficulty, disaggregated by loan class and type of concession granted as of September 30, 2023 (in thousands):


		Term Extension
		Amortized Cost Basis				% of Total Loans
Loan Type
Commercial business		$	-				0.00	%
Commercial mortgage			-				0.00	%
Residential real estate loans			335				0.05	%
Residential real estate lines			-				0.00	%
Consumer indirect			-				0.00	%
Other consumer			-				0.00	%
Total		$	335				0.01	%

Financial Effect of the Modifications Made to Borrowers Experiencing Financial Difficulty

The following table describes the financial effect of the modifications made to borrowers experiencing financial difficulty:


Term Extension
Loan Type		Financial Effect
Residential real estate loans		Added a weighted average 10.0 years to the life of the loans, which reduced monthly payment amount for the borrower.

Performance of Loans that are Modified to Borrowers Experiencing Financial Difficulty

The following table depicts the performance of loans that have been modified in the nine months ended September 30, 2023 (in thousands):


		Payment Status (Amortized Cost Basis)
		Current				30-89 Days Past Due				90+ Days Past Due
Loan Type
Commercial business		$	-			$	-			$	-
Commercial mortgage			-				-				-
Residential real estate loans			80				158				97
Residential real estate lines			-				-				-
Consumer indirect			-				-				-
Other consumer			-				-				-
Total		$	80			$	158			$	97

Summary of Collateral Dependent Loans

The following table presents the amortized cost basis of collateral dependent loans by collateral type as of September 30, 2023 and December 31, 2022 (in thousands):


		Collateral type
		Business assets				Real property				Total				Specific Reserve
September 30, 2023
Commercial business		$	11,901			$	—			$	11,901			$	1,533
Commercial mortgage			105				20,296				20,401				645
Total		$	12,006			$	20,296			$	32,302			$	2,178

December 31, 2022
Commercial business		$	147			$	993			$	1,140			$	126
Commercial mortgage			—				21,592				21,592				1,152
Total		$	147			$	22,585			$	22,732			$	1,278

Commercial Loan Portfolio Categorized by Internally Assigned Asset Classification

The following tables set forth the Company’s commercial loan portfolio, categorized by internally assigned asset classification, as of the dates indicated (in thousands):


		Term Loans Amortized Cost Basis by Origination Year
		2023				2022				2021				2020				2019				Prior				Revolving Loans Amortized Cost Basis				Revolving Loans Converted to Term				Total
September 30, 2023
Commercial Business:
Uncriticized		$	76,916			$	139,811			$	84,553			$	37,819			$	22,265			$	57,698			$	246,765			$	—			$	665,827
Special mention			7,129				5,056				2,502				12,841				81				47				2,801				—				30,457
Substandard			2,042				41				55				—				60				1,258				11,798				—				15,254
Doubtful			—				—				—				—				—				—				—				—				—
Total Commercial Business loans		$	86,087			$	144,908			$	87,110			$	50,660			$	22,406			$	59,003			$	261,364			$	—			$	711,538
Current period gross write-offs		$	—			$	5			$	3			$	12			$	8			$	235			$	—			$	—			$	263

Commercial Mortgage:
Uncriticized		$	289,493			$	571,684			$	365,629			$	234,150			$	152,261			$	316,695			$	—			$	—			$	1,929,912
Special mention			2,300				339				4,140				9,176				—				16,373				—				—				32,328
Substandard			3,425				497				518				1,036				190				17,373				—				—				23,039
Doubtful			—				—				—				—				—				—				—				—				—
Total Commercial Mortgage loans		$	295,218			$	572,520			$	370,287			$	244,362			$	152,451			$	350,441			$	—			$	—			$	1,985,279
Current period gross write-offs		$	—			$	—			$	—			$	—			$	—			$	18			$	—			$	—			$	18


		Term Loans Amortized Cost Basis by Origination Year
		2022				2021				2020				2019				2018				Prior				Revolving Loans Amortized Cost Basis				Revolving Loans Converted to Term				Total
December 31, 2022
Commercial Business
Uncriticized		$	146,581			$	105,001			$	61,115			$	29,644			$	39,625			$	21,467			$	244,848			$	—			$	648,281
Special mention			238				2,351				8,736				7				5				—				1,809				—				13,146
Substandard			—				72				—				42				516				1,034				1,158				—				2,822
Doubtful			—				—				—				—				—				—				—				—				—
Total		$	146,819			$	107,424			$	69,851			$	29,693			$	40,146			$	22,501			$	247,815			$	—			$	664,249
Commercial Mortgage
Uncriticized		$	464,863			$	380,138			$	260,463			$	171,918			$	116,770			$	248,771			$	—			$	—			$	1,642,923
Special mention			—				—				2,319				136				—				11,784				—				—				14,239
Substandard			2,987				202				105				78				10,104				9,202				—				—				22,678
Doubtful			—				—				—				—				—				—				—				—				—
Total		$	467,850			$	380,340			$	262,887			$	172,132			$	126,874			$	269,757			$	—			$	—			$	1,679,840

Retail Loan Portfolio Categorized by Performance Status

The following tables set forth the Company’s retail loan portfolio, categorized by performance status, as of the dates indicated (in thousands):


		Term Loans Amortized Cost Basis by Origination Year
		2023				2022				2021				2020				2019				Prior				Revolving Loans Amortized Cost Basis				Revolving Loans Converted to Term				Total
September 30, 2023
Residential Real Estate Loans
Performing		$	94,045			$	79,520			$	79,578			$	109,822			$	69,564			$	197,688			$	—			$	—			$	630,217
Nonperforming			—				102				1,284				744				840				2,022				—				—				4,992
Total Residential Real Estate Loans		$	94,045			$	79,622			$	80,862			$	110,566			$	70,404			$	199,710			$	—			$	—			$	635,209
Current period gross write-offs		$	—			$	—			$	—			$	—			$	32			$	70			$	—			$	—			$	102

Residential Real Estate Lines
Performing		$	—			$	—			$	—			$	—			$	—			$	—			$	71,149			$	5,372			$	76,521
Nonperforming			—				—				—				—				—				—				31				170				201
Total Residential Real Estate Lines		$	—			$	—			$	—			$	—			$	—			$	—			$	71,180			$	5,542			$	76,722
Current period gross write-offs		$	—			$	—			$	—			$	—			$	—			$	—			$	28			$	13			$	41

Consumer Indirect
Performing		$	201,305			$	361,192			$	255,880			$	89,404			$	37,256			$	33,718			$	—			$	—			$	978,755
Nonperforming			643				1,105				1,064				300				149				121				—				—				3,382
Total Consumer Indirect Loans		$	201,948			$	362,297			$	256,944			$	89,704			$	37,405			$	33,839			$	—			$	—			$	982,137
Current period gross write-offs		$	342			$	4,331			$	4,254			$	1,343			$	1,018			$	1,189			$	—			$	—			$	12,477

Other Consumer
Performing		$	29,304			$	4,453			$	1,680			$	1,171			$	311			$	644			$	2,712			$	—			$	40,275
Nonperforming			—				—				—				—				—				—				6				—				6
Total Other Consumer Loans		$	29,304			$	4,453			$	1,680			$	1,171			$	311			$	644			$	2,718			$	—			$	40,281
Current period gross write-offs		$	713			$	122			$	105			$	32			$	28			$	19			$	45			$	—			$	1,064

(5.) LOANS (Continued)


		Term Loans Amortized Cost Basis by Origination Year
		2022				2021				2020				2019				2018				Prior				Revolving Loans Amortized Cost Basis				Revolving Loans Converted to Term				Total
December 31, 2022
Residential Real Estate Loans
Performing		$	79,882			$	85,821			$	118,819			$	76,437			$	55,520			$	169,410			$	—			$	—			$	585,889
Nonperforming			—				305				510				795				677				1,784				—				—				4,071
Total		$	79,882			$	86,126			$	119,329			$	77,232			$	56,197			$	171,194			$	—			$	—			$	589,960
Residential Real Estate Lines
Performing		$	—			$	—			$	—			$	—			$	—			$	—			$	70,942			$	6,586			$	77,528
Nonperforming			—				—				—				—				—				—				34				108				142
Total		$	—			$	—			$	—			$	—			$	—			$	—			$	70,976			$	6,694			$	77,670
Consumer Indirect
Performing		$	440,332			$	331,902			$	126,664			$	59,981			$	39,352			$	22,310			$	—			$	—			$	1,020,541
Nonperforming			748				1,209				432				381				205				104				—				—				3,079
Total		$	441,080			$	333,111			$	127,096			$	60,362			$	39,557			$	22,414			$	—			$	—			$	1,023,620
Other Consumer
Performing		$	6,463			$	2,664			$	2,043			$	761			$	213			$	308			$	2,656			$	—			$	15,108
Nonperforming			—				—				—				—				—				—				2				—				2
Total		$	6,463			$	2,664			$	2,043			$	761			$	213			$	308			$	2,658			$	—			$	15,110

Changes in the Allowance for Loan Losses

The following table sets forth the changes in the allowance for credit losses – loans for the three and nine months ended September 30, 2023 and 2022 (in thousands):


		Commercial Business				Commercial Mortgage				Residential Real Estate Loans				Residential Real Estate Lines				Consumer Indirect				Other Consumer				Total
Three months ended September 30, 2023
Allowance for credit losses – loans:
Beginning balance		$	13,418			$	16,826			$	4,646			$	710			$	13,306			$	930			$	49,836
Charge-offs			(146	)			—				—				—				(4,848	)			(344	)			(5,338	)
Recoveries			114				972				4				—				2,565				85				3,740
(Benefit) provision			(600	)			(1,521	)			(791	)			(173	)			3,583				894				1,392
Ending balance		$	12,786			$	16,277			$	3,859			$	537			$	14,606			$	1,565			$	49,630
Nine months ended September 30, 2023
Beginning balance		$	12,585			$	14,412			$	3,301			$	608			$	14,238			$	269			$	45,413
Charge-offs			(263	)			(18	)			(102	)			(41	)			(12,477	)			(1,064	)			(13,965	)
Recoveries			322				976				35				—				8,056				253				9,642
Provision (benefit)			142				907				625				(30	)			4,789				2,107				8,540
Ending balance		$	12,786			$	16,277			$	3,859			$	537			$	14,606			$	1,565			$	49,630

		Commercial Business				Commercial Mortgage				Residential Real Estate Loans				Residential Real Estate Lines				Consumer Indirect				Other Consumer				Total
Three months ended September 30, 2022
Allowance for credit losses – loans:
Beginning balance		$	10,140			$	12,064			$	2,140			$	509			$	17,332			$	267			$	42,452
Charge-offs			(20	)			—				—				(38	)			(4,058	)			(398	)			(4,514	)
Recoveries			116				1				4				3				2,168				69				2,361
Provision (benefit)			1,288				2,054				210				180				(260	)			335				3,807
Ending balance		$	11,524			$	14,119			$	2,354			$	654			$	15,182			$	273			$	44,106
Nine months ended September 30, 2022
Beginning balance			11,099				14,777				1,604				379				11,611				206				39,676
Charge-offs			(262	)			—				(56	)			(38	)			(9,216	)			(1,083	)			(10,655	)
Recoveries			305				2,020				19				20				6,129				262				8,755
Provision (benefit)			382				(2,678	)			787				293				6,658				888				6,330
Ending balance		$	11,524			$	14,119			$	2,354			$	654			$	15,182			$	273			$	44,106