Loans

3 Months Ended

Mar. 31, 2024

Loans:

Loan balances were as follows:


(In Thousands of Dollars)	March 31, 2024			December 31, 2023
Commercial real estate
Owner occupied	$	390,058		$	399,273
Non-owner occupied		705,168			712,315
Farmland		201,788			202,950
Other		244,146			224,218
Commercial
Commercial and industrial		335,747			346,354
Agricultural		58,637			58,338
Residential real estate
1-4 family residential		836,252			843,697
Home equity lines of credit		143,696			142,441
Consumer
Indirect		224,931			226,815
Direct		22,624			23,805
Other		9,291			9,164
Total loans	$	3,172,338		$	3,189,370
Net deferred loan costs		8,980			8,757
Allowance for credit losses		(33,159	)		(34,440	)
Net loans	$	3,148,159		$	3,163,687

Allowance for credit loss activity

The following tables present the activity in the allowance for credit losses by portfolio segment for the three month periods ended March 31, 2024 and 2023:

Three Months Ended March 31, 2024


(In Thousands of Dollars)	Commercial Real Estate			Commercial			Residential Real Estate			Consumer			Total
Allowance for credit losses
Beginning balance	$	18,150		$	5,087		$	6,916		$	4,287		$	34,440
(Credit) Provision for credit losses		(541	)		62			(69	)		278			(270	)
Loans charged off		(146	)		(643	)		(30	)		(463	)		(1,282	)
Recoveries		18			37			23			193			271
Total ending allowance balance	$	17,481		$	4,543		$	6,840		$	4,295		$	33,159

Three Months Ended March 31, 2023


(In Thousands of Dollars)	Commercial Real Estate		Commercial			Residential Real Estate			Consumer			Total
Allowance for credit losses
Beginning balance	$	14,840	$	4,186		$	4,374		$	3,578		$	26,978
PCD ACL on loans acquired		850		138			11			0			999
Provision for credit losses		4,128		1,044			2,398			735			8,305
Loans charged off		0		(143	)		(83	)		(243	)		(469	)
Recoveries		1		5			32			160			198
Total ending allowance balance	$	19,819	$	5,230		$	6,732		$	4,230		$	36,011

The cumulative loss rate used as the basis for the estimate of credit losses is comprised of the Company's historical loss experience from December 31, 2011 to March 31, 2024. As of March 31, 2024, the Company expects that the markets in which it operates will experience minimal changes to economic conditions, stable trend in unemployment rate, and a level trend of delinquencies. Management adjusted historical loss experience for these expectations. No reversion adjustments were necessary, as the starting point for the Company's estimate was a cumulative loss rate covering the expected contractual term of the portfolio. While there are many factors that go into the calculation of the allowance for credit losses, the change in the balances from March 31, 2023 to March 31, 2024 is largely attributed to improvements in the Company's loss rates that anchor the qualitative factors and impact the quantitative reserve, reclassification of construction loan balances that were placed into their permanent loan pool, adjustments made to the Commercial Staffing qualitative factor and release of reserves related to loans transferred to held for sale.

The following tables present the amortized cost basis of loans on nonaccrual status and loans past due over 89 days still accruing as of March 31, 2024 and December 31, 2023:


(In Thousands of Dollars)	Nonaccrual with no allowance for credit loss		Nonaccrual with an allowance for credit loss		Loans past due over 89 days still accruing
March 31, 2024
Commercial real estate
Owner occupied	$	1,749	$	813	$	0
Non-owner occupied		92		163		0
Farmland		1,870		7		0
Other		0		72		0
Commercial
Commercial and industrial		348		1,005		0
Agricultural		192		287		0
Residential real estate
1-4 family residential		364		2,804		1,245
Home equity lines of credit		206		197		42
Consumer
Indirect		42		225		86
Direct		65		49		24
Other		0		4		0
Total loans	$	4,928	$	5,626	$	1,397


(In Thousands of Dollars)	Nonaccrual with no allowance for credit loss		Nonaccrual with an allowance for credit loss		Loans past due over 89 days still accruing
December 31, 2023
Commercial real estate
Owner occupied	$	1,804	$	830	$	0
Non-owner occupied		19		1,491		0
Farmland		1,957		9		0
Other		0		80		0
Commercial
Commercial and industrial		394		1,408		0
Agricultural		203		317		0
Residential real estate
1-4 family residential		348		3,009		460
Home equity lines of credit		240		210		69
Consumer
Indirect		22		300		125
Direct		65		69		1
Other		0		5		0
Total loans	$	5,052	$	7,728	$	655

The above table for the period ending December 31, 2023 does not include a $1.63 million non-owner occupied commercial real estate loan that was held-for-sale and in nonaccrual status. There were no nonaccrual or past due loans related to loans held-for-sale at March 31, 2024.

The following tables present the amortized cost basis of collateral-dependent loans by class of loans as of March 31, 2024 and December 31, 2023:


(In Thousands of Dollars)	Real Estate		Business Assets		Vehicles		Cash
March 31, 2024
Commercial real estate
Owner occupied	$	1,749	$	0	$	0	$	0
Non-owner occupied		92		0		0		0
Farmland		1,870		0		0		0
Other		0		0		0		0
Commercial
Commercial and industrial		92		467		0		0
Agricultural		0		192		0		0
Residential real estate
1-4 family residential		3,388		0		0		0
Home equity lines of credit		252		0		0		0
Consumer
Indirect		0		0		68		0
Direct		0		0		17		66
Other		0		0		0		0
Total loans	$	7,443	$	659	$	85	$	66


(In Thousands of Dollars)	Real Estate		Business Assets		Vehicles		Cash
December 31, 2023
Commercial real estate
Owner occupied	$	1,804	$	0	$	0	$	0
Non-owner occupied		1,335		0		0		0
Farmland		1,957		0		0		0
Other		0		0		0		0
Commercial
Commercial and industrial		94		867		0		0
Agricultural		0		203		0		0
Residential real estate
1-4 family residential		3,352		0		0		0
Home equity lines of credit		294		0		0		0
Consumer
Indirect		0		0		53		0
Direct		0		0		19		66
Other		0		0		0		0
Total loans	$	8,836	$	1,070	$	72	$	66

The following tables present the aging of the recorded investment in past due loans as of March 31, 2024 and December 31, 2023 by class of loans.


(In Thousands of Dollars)	30-59 Days Past Due		60-89 Days Past Due		90 Days or More Past Due and Nonaccrual		Total Past Due		Loans Not Past Due		Total
March 31, 2024
Commercial real estate
Owner occupied	$	237	$	0	$	2,562	$	2,799	$	387,028	$	389,827
Non-owner occupied		0		0		255		255		704,447		704,702
Farmland		2		360		1,877		2,239		199,335		201,574
Other		50		0		72		122		243,616		243,738
Commercial
Commercial and industrial		642		281		1,353		2,276		334,939		337,215
Agricultural		321		2		479		802		58,603		59,405
Residential real estate
1-4 family residential		7,404		2,189		4,413		14,006		822,199		836,205
Home equity lines of credit		288		268		445		1,001		142,741		143,742
Consumer
Indirect		1,410		458		353		2,221		230,746		232,967
Direct		116		35		138		289		22,362		22,651
Other		6		0		4		10		9,282		9,292
Total loans	$	10,476	$	3,593	$	11,951	$	26,020	$	3,155,298	$	3,181,318


(In Thousands of Dollars)	30-59 Days Past Due		60-89 Days Past Due		90 Days or More Past Due and Nonaccrual		Total Past Due		Loans Not Past Due		Total
December 31, 2023
Commercial real estate
Owner occupied	$	302	$	293	$	2,634	$	3,229	$	395,799	$	399,028
Non-owner occupied		90		0		1,510		1,600		710,195		711,795
Farmland		365		0		1,966		2,331		200,395		202,726
Other		0		0		80		80		223,697		223,777
Commercial
Commercial and industrial		540		199		1,802		2,541		345,278		347,819
Agricultural		292		40		520		852		58,223		59,075
Residential real estate
1-4 family residential		6,819		4,488		3,817		15,124		828,437		843,561
Home equity lines of credit		729		34		519		1,282		141,189		142,471
Consumer
Indirect		2,045		289		447		2,781		232,105		234,886
Direct		153		23		135		311		23,514		23,825
Other		4		0		5		9		9,155		9,164
Total loans	$	11,339	$	5,366	$	13,435	$	30,140	$	3,167,987	$	3,198,127