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Loans and Allowance for Credit Losses (Tables)

9 Months Ended

Sep. 30, 2024

Receivables [Abstract]

Loans by Type as Percentage of Portfolio

Loans by type as a percentage of the portfolio were as follows:


	September 30, 2024							December 31, 2023
(Dollars in thousands)	Balance			%				Balance			%				Percent Increase (Decrease)
Agricultural	$	49,147			3.3	%		$	49,210			3.5	%			(0.1	)	%
Commercial and Industrial		229,232			15.2	%			229,915			16.3	%			(0.3	)	%
Commercial Real Estate		862,773			57.4	%			786,921			55.8	%			9.6		%
Consumer		30,693			2.0	%			36,541			2.6	%			(16.0	)	%
Construction Real Estate		14,555			1.0	%			20,936			1.5	%			(30.5	)	%
Residential Real Estate		279,058			18.6	%			267,730			19.0	%			4.2		%
Loans to Other Financial Institutions		38,492			2.6	%			19,400			1.4	%			98.4		%
Gross Loans	$	1,503,950						$	1,410,653

Allowance for credit losses		16,490			1.10	%			15,685			1.11	%

Net loans	$	1,487,460						$	1,394,968

Allowance for Credit Losses and Balances in Loan Portfolio

Activity in the allowance for credit losses and balances in the loan portfolio were as follows:


						Commercial																				Loans to Other
(Dollars in thousands)						And								Commercial				Construction				Residential				Financial
		Agricultural				Industrial				Consumer				Real Estate				Real Estate				Real Estate				Institutions				Total
Allowance for Credit Losses Three Months Ended September 30, 2024
Beginning balance		$	112			$	2,161			$	795			$	9,360			$	49			$	3,625			$	50			$	16,152
Charge-offs			-				-				(166	)			-				-				(23	)			-				(189	)
Recoveries			-				2				96				-				-				4				-				102
Provision			(2	)			307				36				(140	)			(13	)			227				10				425
Ending balance		$	110			$	2,470			$	761			$	9,220			$	36			$	3,833			$	60			$	16,490

Allowance for Credit Losses Nine Months Ended September 30, 2024
Beginning balance		$	94			$	2,216			$	823			$	8,820			$	58			$	3,644			$	30			$	15,685
Charge-offs			-				(1	)			(616	)			-				-				(23	)			-				(640	)
Recoveries			-				13				321				-				-				11				-				345
Provision			16				242				233				400				(22	)			201				30				1,100
Ending balance		$	110			$	2,470			$	761			$	9,220			$	36			$	3,833			$	60			$	16,490

Individually evaluated for credit loss		$	1			$	7			$	1.00			$	1			$	-			$	78			$	-			$	88

Collectively evaluated for credit loss		$	109			$	2,463			$	760			$	9,219			$	36			$	3,755			$	60			$	16,402

Loans
September 30, 2024
Individually evaluated for credit loss		$	13			$	174			$	26			$	27			$	229			$	2,266			$	-			$	2,735
Collectively evaluated for credit loss			49,134				229,058				30,667				862,746				14,326				276,792				38,492				1,501,215
Ending balance		$	49,147			$	229,232			$	30,693			$	862,773			$	14,555			$	279,058			$	38,492			$	1,503,950


					Commercial																				Loans to Other
(Dollars in thousands)					and								Commercial				Construction				Residential				Financial
	Agricultural				Industrial				Consumer				Real Estate				Real Estate				Real Estate				Institutions				Total
Allowance for Credit Losses
December 31, 2023
Individually evaluated for impairment	$	2			$	6			$	-			$	1			$	-			$	51			$	-			$	60

Collectively evaluated for impairment	$	92			$	2,210			$	823			$	8,819			$	58			$	3,593			$	30			$	15,625


Loans
December 31, 2023
Individually evaluated for impairment	$	54			$	136			$	2			$	29			$	-			$	1,858			$	-			$	2,079
Collectively evaluated for impairment		49,156				229,779				36,539				786,892				20,936				265,872				19,400				1,408,574
Acquired with deteriorated credit quality		-				-				-				-				-				-				-				-
Ending balance	$	49,210			$	229,915			$	36,541			$	786,921			$	20,936			$	267,730			$	19,400			$	1,410,653


					Commercial
(Dollars in thousands)					and								Commercial				Construction				Residential				Loans to Other
	Agricultural				Industrial				Consumer				Real Estate				Real Estate				Real Estate				Financial Institution				Unallocated				Total
Allowance for Credit Losses Three Months Ended September 30, 2023
Beginning balance	$	78			$	2,896			$	885			$	7,237			$	70			$	3,376			$	40			$	-			$	14,582
Charge-offs		-				(73	)			(161	)			-				-				(27	)			-				-				(261	)
Recoveries		-				28				80				-				-				5				-				-				113
Provision		5				(328	)			22				908				(19	)			(150	)			-				-				438
Ending balance	$	83			$	2,523			$	826			$	8,145			$	51			$	3,204			$	40			$	-			$	14,872

Allowance for Credit Losses Nine Months Ended September 30, 2023
Beginning balance	$	144			$	1,361			$	310			$	4,822			$	63			$	906			$	-			$	13			$	7,619
Cumulative effect of change in accounting principle		14				1,587				541				3,006				20				2,010				-				(13	)			7,165
Charge-offs		-				(73	)			(432	)			-				-				(27	)			-				-				(532	)
Recoveries		-				57				208				13				-				10				-				-				288
Provision		(75	)			(409	)			199				304				(32	)			305				40				-				332
Ending balance	$	83			$	2,523			$	826			$	8,145			$	51			$	3,204							$	-			$	14,872

Individually evaluated for impairment	$	3			$	89			$	-			$	347			$	-			$	45			$	-			$	-			$	484

Collectively evaluated for impairment	$	80			$	2,434			$	826			$	7,798			$	51			$	3,159			$	40			$	-			$	14,388

Schedule of Information Regarding Credit Exposure

The following table reflects the amortized cost basis of loans as of September 30, 2024 based on year of origination (dollars in thousands):


Commercial:	2024				2023				2022				2021				2020				Prior				Term Loans Total				Revolving Loans				Grand Total
Agricultural
Pass	$	6,290			$	1,794			$	3,359			$	2,924			$	1,573			$	19,181			$	35,121			$	13,844			$	48,965
Special mention		-				-				-				-				-				182				182				-				182
Substandard		-				-				-				-				-				-				-				-				-
Doubtful		-				-				-				-				-				-				-				-				-
Loss		-				-				-				-				-				-				-				-				-
Total	$	6,290			$	1,794			$	3,359			$	2,924			$	1,573			$	19,363			$	35,303			$	13,844			$	49,147
Current year-to-date gross write-offs (1)	$	-			$	-			$	-			$	-			$	-			$	-			$	-			$	-			$	-

Commercial and Industrial
Pass	$	33,953			$	20,139			$	33,374			$	17,065			$	7,948			$	11,816			$	124,295			$	104,519			$	228,814
Special mention		-				-				93				60				27				226				406				10				416
Substandard		-				-				-				-				-				2				2				-				2
Doubtful		-				-				-				-				-				-				-				-				-
Loss		-				-				-				-				-				-				-				-				-
Total	$	33,953			$	20,139			$	33,467			$	17,125			$	7,975			$	12,044			$	124,703			$	104,529			$	229,232
Current year-to-date gross write-offs (1)	$	-			$	-			$	-			$	-			$	-			$	1			$	1			$	-			$	1

Commercial Real Estate
Pass	$	107,946			$	140,667			$	112,938			$	101,041			$	68,276			$	162,743			$	693,611			$	168,808			$	862,419
Special mention		-				-				-				-				-				354				354				-				354
Substandard		-				-				-				-				-				-				-				-				-
Doubtful		-				-				-				-				-				-				-				-				-
Loss		-				-				-				-				-				-				-				-				-
Total	$	107,946			$	140,667			$	112,938			$	101,041			$	68,276			$	163,097			$	693,965			$	168,808			$	862,773
Current year-to-date gross write-offs (1)	$	-			$	-			$	-			$	-			$	-			$	-			$	-			$	-			$	-

Total Commercial Loans	$	148,189			$	162,600			$	149,764			$	121,090			$	77,824			$	194,504			$	853,971			$	287,181			$	1,141,152


Retail:	2024				2023				2022				2021				2020				Prior				Term Loans Total				Revolving Loans				Grand Total
Consumer
Performing	$	5,439			$	7,354			$	9,107			$	4,822			$	1,848			$	1,473			$	30,043			$	648			$	30,691
Nonperforming		-				-				-				-				-				-				-				-				-
Nonaccrual		-				-				2				-				-				-				2				-				2
Total	$	5,439			$	7,354			$	9,109			$	4,822			$	1,848			$	1,473			$	30,045			$	648			$	30,693
Current year-to-date gross write-offs (1)	$	-			$	31			$	110			$	1			$	-			$	2			$	144			$	-			$	144

Construction real estate
Performing	$	-			$	986			$	-			$	530			$	-			$	-			$	1,516			$	12,810			$	14,326
Nonperforming		-				-				-				-				-				-				-				-				-
Nonaccrual		-				-				-				-				-				-				-				229				229
Total	$	-			$	986			$	-			$	530			$	-			$	-			$	1,516			$	13,039			$	14,555
Current year-to-date gross write-offs (1)	$	-			$	-			$	-			$	-			$	-			$	-			$	-			$	-			$	-

Residential real estate
Performing	$	30,342			$	46,667			$	57,249			$	26,151			$	14,684			$	46,458			$	221,551			$	55,383			$	276,934
Nonperforming		-				-				-				-				-				-				-				-				-
Nonaccrual		-				204				1,142				551				-				192				2,089				35				2,124
Total	$	30,342			$	46,871			$	58,391			$	26,702			$	14,684			$	46,650			$	223,640			$	55,418			$	279,058
Current year-to-date gross write-offs (1)	$	-			$	23			$	-			$	-			$	-			$	-			$	23			$	-			$	23

Loans to Other Financial Institutions
Performing	$	38,492			$	-			$	-			$	-			$	-			$	-			$	38,492			$	-			$	38,492
Nonperforming		-				-				-				-				-				-				-				-				-
Nonaccrual		-				-				-				-				-				-				-				-				-
Total	$	38,492			$	-			$	-			$	-			$	-			$	-			$	38,492			$	-			$	38,492
Current year-to-date gross write-offs (1)	$	-			$	-			$	-			$	-			$	-			$	-			$	-			$	-			$	-

Total Retail Loans	$	74,273			$	55,211			$	67,500			$	32,054			$	16,532			$	48,123			$	293,693			$	69,105			$	362,798

(1) It is noted that write-offs in the tables above do not include checking account write-offs. Checking account write-offs during the first nine months of 2024 were $473,000 or an annualized $631,000 compared to $480,000 during the full year 2023 and $377,000 or an annualized $503,000 during the first nine months of 2023.

The following table reflects the amortized cost basis of loans as of December 31, 2023 based on year of origination (dollars in thousands):


Commercial:	2023				2022				2021				2020				2019				Prior				Term Loans Total				Revolving Loans				Grand Total
Agricultural
Pass	$	5,015			$	4,088			$	3,078			$	1,788			$	7,028			$	18,476			$	39,473			$	9,507			$	48,980
Special mention		-				-				-				-				176				54				230				-				230
Substandard		-				-				-				-				-				-				-				-				-
Doubtful		-				-				-				-				-				-				-				-				-
Loss		-				-				-				-				-				-				-				-				-
Total	$	5,015			$	4,088			$	3,078			$	1,788			$	7,204			$	18,530			$	39,703			$	9,507			$	49,210
Current year-to-date gross write-offs (1)	$	-			$	-			$	-			$	-			$	-			$	-			$	-			$	-			$	-

Commercial and Industrial
Pass	$	23,600			$	45,489			$	23,462			$	10,502			$	9,214			$	11,882			$	124,149			$	105,559			$	229,708
Special mention		-				-				28				35				73				64				200				3				203
Substandard		-				-				-				-				-				4				4				-				4
Doubtful		-				-				-				-				-				-				-				-				-
Loss		-				-				-				-				-				-				-				-				-
Total	$	23,600			$	45,489			$	23,490			$	10,537			$	9,287			$	11,950			$	124,353			$	105,562			$	229,915
Current year-to-date gross write-offs (1)	$	-			$	55			$	30			$	71			$	-			$	2			$	158			$	-			$	158

Commercial Real Estate
Pass	$	149,181			$	134,289			$	107,033			$	71,754			$	43,846			$	136,361			$	642,464			$	143,120			$	785,584
Special mention		-				-				-				-				-				1,337				1,337				-				1,337
Substandard		-				-				-				-				-				-				-				-				-
Doubtful		-				-				-				-				-				-				-				-				-
Loss		-				-				-				-				-				-				-				-				-
Total	$	149,181			$	134,289			$	107,033			$	71,754			$	43,846			$	137,698			$	643,801			$	143,120			$	786,921
Current year-to-date gross write-offs (1)	$	-			$	-			$	-			$	-			$	-			$	-			$	-			$	-			$	-

Total Business Loans	$	177,796			$	183,866			$	133,601			$	84,079			$	60,337			$	168,178			$	807,857			$	258,189			$	1,066,046


Retail:	2023				2022				2021				2020				2019				Prior				Term Loans Total				Revolving Loans				Grand Total
Consumer
Performing	$	9,775			$	13,876			$	6,771			$	2,849			$	1,260			$	1,202			$	35,733			$	808			$	36,541
Nonperforming		-				-				-				-				-				-				-				-				-
Nonaccrual		-				-				-				-				-				-				-				-				-
Total	$	9,775			$	13,876			$	6,771			$	2,849			$	1,260			$	1,202			$	35,733			$	808			$	36,541
Current year-to-date gross write-offs (1)	$	8			$	24			$	11			$	28			$	-			$	1			$	72			$	-			$	72

Construction real estate
Performing	$	2,507			$	2,719			$	552			$	-			$	-			$	-			$	5,778			$	15,158			$	20,936
Nonperforming		-				-				-				-				-				-				-				-				-
Nonaccrual		-				-				-				-				-				-				-				-				-
Total	$	2,507			$	2,719			$	552			$	-			$	-			$	-			$	5,778			$	15,158			$	20,936
Current year-to-date gross write-offs (1)	$	-			$	-			$	-			$	-			$	-			$	-			$	-			$	-			$	-

Residential real estate
Performing	$	54,231			$	64,768			$	28,301			$	16,391			$	12,556			$	40,270			$	216,517			$	49,491			$	266,008
Nonperforming		-				-				-				-				-				-				-				-				-
Nonaccrual		-				380				826				-				-				486				1,692				30				1,722
Total	$	54,231			$	65,148			$	29,127			$	16,391			$	12,556			$	40,756			$	218,209			$	49,521			$	267,730
Current year-to-date gross write-offs (1)	$	-			$	26			$	-			$	-			$	-			$	1			$	27			$	-			$	27

Loans to Other Financial Institutions
Performing	$	19,400			$	-			$	-			$	-			$	-			$	-			$	19,400			$	-			$	19,400
Nonperforming		-				-				-				-				-				-				-				-				-
Nonaccrual		-				-				-				-				-				-				-				-				-
Total	$	19,400			$	-			$	-			$	-			$	-			$	-			$	19,400			$	-			$	19,400
Current year-to-date gross write-offs (1)	$	-			$	-			$	-			$	-			$	-			$	-			$	-			$	-			$	-

Total Consumer Loans	$	85,913			$	81,743			$	36,450			$	19,240			$	13,816			$	41,958			$	279,120			$	65,487			$	344,607

(1) It is noted that write-offs in the tables above do not include checking account write-offs. Checking account write-offs during the first nine months of 2024 were $473,000 or an annualized $631,000 compared to $480,000 during the full year 2023 and $377,000 or an annualized $503,000 during the first nine months of 2023.

Summary of Amortized Cost Basis Loans Modified To Borrowers Experiencing On Financing Receivable

The following tables present the amortized cost basis of the loans modified to borrowers experiencing financial difficulty disaggregated by class of financing receivable and type of concession granted during the first nine months of 2024 and the full year 2023.


For the period ended:	September 30, 2024

	Term Extension
					% of Total
					Class of
(Dollars in thousands)	Amortized				Financing
	Cost Basis				Receivable
Residential real estate	$	121				0	%
Total	$	121


For the period ended:	December 31, 2023

	Term Extension
					% of Total
					Class of
(Dollars in thousands)	Amortized				Financing
	Cost Basis				Receivable
Commercial and industrial	$	60				0	%
Residential real estate		129				0	%
Total	$	189

The following table presents the financial effect by type of modification made to borrowers experiencing financial difficulty and class of financing receivable during the first nine months of 2024 and the full year 2023.


For the period ended:	September 30, 2024
	Term Extension
Residential real estate	Provided with new five year payment plan based on bankruptcy


For the period ended:	December 31, 2023
	Term Extension
Commercial and industrial	Termed out line of credit & termed out draw note
Residential real estate	Provided with new twelve month payment plan to catch up on past due balance.

The following table presents the period-end amortized cost basis of financing receivables that had a payment default during the period and were modified in the 12 months before default to borrowers experiencing financial difficulty.


For the period ended:	September 30, 2024
(Dollars in thousands)	Term extension

Residential real estate	$	121
Total	$	121


For the period ended:	December 31, 2023
(Dollars in thousands)	Term extension

Commercial and industrial	$	60
Residential real estate		129
Total	$	189

The following table presents the period-end amortized cost basis of loans that have been modified in the past 12 months to borrowers experiencing financial difficulty by payment status and class of financing receivable.


For the period ended:	September 30, 2024
(Dollars in thousands)	Current				30-89 days				Greater than 90 days				Total

Commercial and industrial	$	41			$	-			$	-			$	41
Residential real estate		-				-				121				121
Total	$	41			$	-			$	121			$	162


For the period ended:	December 31, 2023
(Dollars in thousands)	Current				30-89 days				Greater than 90 days				Total

Commercial and industrial	$	60			$	-			$	-			$	60
Residential real estate		-				-				129				129
Total	$	60			$	-			$	129			$	189

Nonaccrual Loans by Loan Category

Nonaccrual loans by loan category were as follows:


As of September 30, 2024
(Dollars in thousands)	Nonaccrual loans with no ACL				Total nonaccrual loans				Interest income recognized year to date on nonaccrual loans
Consumer	$	-			$	2			$	-
Construction real estate		229				—				9
Residential real estate		361				1,763				29
Total nonaccrual loans	$	590			$	1,765			$	38


As of September 30, 2023
(Dollars in thousands)	Nonaccrual loans with no ACL				Total nonaccrual loans				Interest income recognized year to date on nonaccrual loans
Commercial and industrial	$	-			$	103			$	5
Residential real estate		457				1,567				10
Total nonaccrual loans	$	457			$	1,670			$	15


As of December 31, 2023
(Dollars in thousands)	Nonaccrual loans with no ACL				Total nonaccrual loans				Interest income recognized year to date on nonaccrual loans
Commercial and industrial	$	-			$	1			$	-
Residential real estate		707				1,722				16
Total nonaccrual loans	$	707			$	1,723			$	16

Aging Analysis of Loans by Loan Category

An aging analysis of loans by loan category follows:


									Loans																Loans
	Loans				Loans				Past Due																90 Days
	Past Due				Past Due				Greater																Past
(Dollars in thousands)	30 to 59				60 to 89				Than 90								Loans Not				Total				Due and
	Days (1)				Days (1)				Days (1)				Total (1)				Past Due				Loans				Accruing
September 30, 2024
Agricultural	$	-			$	-			$	-			$	-			$	49,147			$	49,147			$	-
Commercial and industrial		-				43				-				43				229,189				229,232				-
Consumer		7				-				-				7				30,686				30,693				-
Commercial real estate		-				-				229				229				862,544				862,773				-
Construction real estate		50				24				2				76				14,479				14,555				-
Residential real estate		249				1,104				1,240				2,593				276,465				279,058				-
Loans to Other Financial Institutions		-				-				-				-				38,492				38,492				-
	$	306			$	1,171			$	1,471			$	2,948			$	1,501,002			$	1,503,950			$	-


December 31, 2023
Agricultural	$	-			$	-			$	-			$	-			$	49,210			$	49,210			$	-
Commercial and industrial		-				-				1				1				229,914				229,915				-
Consumer		31				2				-				33				36,508				36,541				-
Commercial real estate		173				-				-				173				786,748				786,921				-
Construction real estate		-				-				-				-				20,936				20,936				-
Residential real estate		755				549				870				2,174				265,556				267,730				-
Loans to Other Financial Institutions		-				-				-				-				19,400				19,400				-
	$	959			$	551			$	871			$	2,381			$	1,408,272			$	1,410,653			$	-

(1) Includes nonaccrual loans.