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Loans and Asset Quality
 12 Months Ended
Dec. 31, 2024
Receivables [Abstract]  
Loans and Asset Quality Loans and Asset Quality
Loans
Loans HFI by category and loans HFS are summarized below:
December 31, 
(in thousands)20242023
Real estate:
Commercial real estate$884,641 $851,582 
One-to-four family residential614,551 599,487 
Construction and development155,229 125,238 
Commercial and industrial327,086 315,327 
Tax-exempt64,930 72,913 
Consumer28,576 28,311 
Total loans HFI$2,075,013 $1,992,858 
Total loans HFS$2,547 $1,306 
Deferred loan origination fees, net of certain direct costs, were $1.7 million and $1.4 million as of December 31, 2024 and 2023, respectively.
Accrued interest receivable on loans HFI totaled $6.9 million and $6.8 million as of December 31, 2024 and 2023, respectively, and was reported in accrued interest receivable on the accompanying consolidated balance sheets.
Concentrations of Credit Risk
The majority of the lending activity occurs within the Bank’s Louisiana markets. The Bank maintains a diversified loan portfolio with a focus on CRE, one-to-four family residential real estate, and commercial and industrial loans. Substantially all of the Bank’s real estate loans are secured by properties located within Louisiana.
Allowance for Credit Losses
The Company maintains an ACL on all loans that reflects management’s estimate of expected credit losses for the full life of the loan portfolio.
The following table summarizes the activity in the ACL by category for the year ended December 31, 2024:
(in thousands)Beginning
Balance
Provision
for Credit
Losses(1)
Charge-offsRecoveriesEnding
Balance
Real estate:
Commercial real estate$9,118 $(71)$— $— $9,047 
One-to-four family residential7,484 (1,041)(1)10 6,452 
Construction and development1,309 344 — — 1,653 
Commercial and industrial2,553 1,887 (380)63 4,123 
Tax-exempt575 (472)— — 103 
Consumer297 353 (422)125 353 
Total allowance for credit losses$21,336 $1,000 $(803)$198 $21,731 
(1)The $1.2 million provision for credit losses on the consolidated statements of income for the year ended December 31, 2024, includes $1.0 million for loans and $200,000 for unfunded loan commitments.
Effective January 1, 2023, the Company adopted the provisions of ASC 326 using the modified retrospective method. The following table summarizes the activity in the ACL by category for the year ended December 31, 2023:
(in thousands)Beginning
Balance
Impact of ASC 326 Adoption
Provision
for Credit
Losses		Charge-offsRecoveriesEnding
Balance
Real estate:
Commercial real estate$7,720 $876 $522 $— $— $9,118 
One-to-four family residential5,682 1,231 584 (23)10 7,484 
Construction and development1,654 (444)108 (9)— 1,309 
Commercial and industrial4,350 (822)(947)(58)30 2,553 
Tax-exempt751 (427)251 — — 575 
Consumer471 (136)217 (383)128 297 
Total allowance for credit losses$20,628 $278 $735 $(473)$168 $21,336 
Allowance for Loan Losses
For reporting periods prior to January 1, 2023, the Company maintained an ALL on loans that represented management’s estimate of probable losses incurred in the portfolio category.
The following table summarizes the activity in the ALL by category for the year ended December 31, 2022:
(in thousands)Beginning
Balance		Provision
for Loan
Losses		Charge-offsRecoveriesEnding
Balance
Real estate:
Commercial real estate$6,749 $970 $— $1 $7,720 
One-to-four family residential5,375 296 — 11 5,682 
Construction and development1,326 328 (18)18 1,654 
Commercial and industrial4,465 (162)(39)86 4,350 
Tax-exempt749 2 — — 751 
Consumer512 316 (490)133 471 
Total allowance for loan losses$19,176 $1,750 $(547)$249 $20,628 
The balance in the ACL and the related recorded investment in loans by category as of December 31, 2024, are as follows:
(in thousands)Individually
Evaluated		Collectively
Evaluated		Total
Allowance for credit losses:
Real estate:
Commercial real estate$32 $9,015 $9,047 
One-to-four family residential144 6,308 6,452 
Construction and development549 1,104 1,653 
Commercial and industrial116 4,007 4,123 
Tax-exempt— 103 103 
Consumer78 275 353 
Total allowance for credit losses$919 $20,812 $21,731 
Loans:
Real estate:
Commercial real estate$4,173 $880,468 $884,641 
One-to-four family residential2,822 611,729 614,551 
Construction and development1,158 154,071 155,229 
Commercial and industrial661 326,425 327,086 
Tax-exempt— 64,930 64,930 
Consumer91 28,485 28,576 
Total loans HFI$8,905 $2,066,108 $2,075,013 
The balance in the ACL and the related recorded investment in loans by category as of December 31, 2023, are as follows:
(in thousands)Individually
Evaluated		Collectively
Evaluated		Total
Allowance for credit losses:
Real estate:
Commercial real estate$342 $8,776 $9,118 
One-to-four family residential57 7,427 7,484 
Construction and development— 1,309 1,309 
Commercial and industrial226 2,327 2,553 
Tax-exempt— 575 575 
Consumer104 193 297 
Total allowance for credit losses$729 $20,607 $21,336 
Loans:
Real estate:
Commercial real estate$1,379 $850,203 $851,582 
One-to-four family residential751 598,736 599,487 
Construction and development— 125,238 125,238 
Commercial and industrial972 314,355 315,327 
Tax-exempt— 72,913 72,913 
Consumer140 28,171 28,311 
Total loans HFI$3,242 $1,989,616 $1,992,858 
Nonaccrual and Past Due Loans
The following table presents nonaccrual loans as of December 31, 2024:
(in thousands)Nonaccrual with No ACLNonaccrual with ACLTotal Nonaccrual
Real estate:
Commercial real estate$458 $276 $734 
One-to-four family residential397 289 686 
Construction and development— 920 920 
Commercial and industrial412 142 554 
Tax-exempt— — — 
Consumer— 74 74 
Total loans HFI$1,267 $1,701 $2,968 
The following table presents nonaccrual loans as of December 31, 2023:
(in thousands)Nonaccrual with No ACLNonaccrual with ACLTotal Nonaccrual
Real estate:
Commercial real estate$— $714 $714 
One-to-four family residential— 269 269 
Construction and development— — — 
Commercial and industrial709 135 844 
Tax-exempt— — — 
Consumer— 132 132 
Total loans HFI$709 $1,250 $1,959 
No material interest income was recognized in the consolidated statements of income on nonaccrual loans for the years ended December 31, 2024, 2023, or 2022.
The following table presents the aging analysis of the past due loans and loans 90 days or more past due and still accruing interest by loan category as of December 31, 2024:
Past Due
(in thousands)30-59 Days60-89 Days
Past Due		90 Days
or More		CurrentTotal
Loans HFI		90 Days or More Past Due and Accruing
Real estate:
Commercial real estate$— $— $704 $883,937 $884,641 $— 
One-to-four family residential1,762 2,705 899 609,185 614,551 264 
Construction and development32 — 918 154,279 155,229 — 
Commercial and industrial4 2 453 326,627 327,086 — 
Tax-exempt— — — 64,930 64,930 — 
Consumer44 15 2 28,515 28,576 2 
Total loans HFI$1,842 $2,722 $2,976 $2,067,473 $2,075,013 $266 
The following table presents the aging analysis of the past due loans and loans 90 days or more past due and still accruing interest by loan category as of December 31, 2023:
Past Due
(in thousands)30-59 Days60-89 Days
Past Due		90 Days
or More		CurrentTotal
Loans HFI		90 Days or More Past Due and Accruing
Real estate:
Commercial real estate$36 $— $678 $850,868 $851,582 $— 
One-to-four family residential392 251 409 598,435 599,487 260 
Construction and development— — 265 124,973 125,238 265 
Commercial and industrial132 60 847 314,288 315,327 45 
Tax-exempt— — — 72,913 72,913 — 
Consumer27 16 46 28,222 28,311 4 
Total loans HFI$587 $327 $2,245 $1,989,699 $1,992,858 $574 
Impaired Loans
For reporting periods prior to January 1, 2023, when ASC 326 was adopted, the Company individually evaluated impaired loans, including TDRs and performing and nonperforming loans. Once a loan was deemed to be impaired, the difference between the loan value and the Bank’s exposure was charged-off or a specific reserve was established.
Information pertaining to impaired loans as of and for the year ended December 31, 2022, is as follows:
(in thousands)Unpaid
Principal
Balance		Recorded
Investment		Related
Allowance		Average
Recorded
Investment		Interest
Income
Recognized
With no related allowance recorded:
Real estate:
Commercial real estate$3,804 $3,796 $— $3,194 $135 
One-to-four family residential1,458 1,387 — 797 68 
Construction and development9 9 — 104 — 
Commercial and industrial51 51 — 58 4 
Tax-exempt— — — — — 
Consumer26 26 — 9 1 
Total with no related allowance5,348 5,269 — 4,162 208 
With allowance recorded:
Real estate:
Commercial real estate717 717 15 1,264 33 
One-to-four family residential120 120 16 48 6 
Construction and development— — — — — 
Commercial and industrial1,360 1,351 172 623 4 
Tax-exempt— — — — — 
Consumer113 111 111 122 1 
Total with related allowance2,310 2,299 314 2,057 44 
Total impaired loans$7,658 $7,568 $314 $6,219 $252 
Loan Modifications
Modifications are made to a borrower experiencing financial difficulty, and the modified terms are in the form of principal forgiveness, interest rate reduction, other-than-insignificant payment delay, or a term extension in the current reporting period. For the years ended December 31, 2024 and 2023, modifications were made to certain borrowers by granting term extensions. These term extensions were not significant to the consolidated financial statements.
Troubled Debt Restructurings
For reporting periods prior to January 1, 2023, when ASC 326 was adopted, the restructuring of a loan was considered a TDR if the borrower was experiencing financial difficulties and the Bank had granted a concession.
A summary of loans modified as TDRs that occurred during the year ended December 31, 2022, is as follows:
December 31, 2022
Recorded Investment
(dollars in thousands)Loan
Count		Pre
Modification		Post
Modification
Real estate:
Commercial real estate1 $50 $50 
One-to-four family residential5 696 699 
Construction and development— — — 
Commercial and industrial— — — 
Tax-exempt— — — 
Consumer1 104 104 
Total7 $850 $853 
The TDRs described above increased the ALL by $101,000 during the year ended December 31, 2022. Additionally, there were no charge-offs of TDRs in 2022, and there were no TDRs that subsequently defaulted in 2022.
Credit Quality Indicators
Loans are categorized based on the degree of risk inherent in the credit and the ability of the borrower to service the debt. A description of the general characteristics of the Bank’s risk rating grades follows:
Pass - These loans are of satisfactory quality and do not require a more severe classification.
Special Mention - This category includes loans with potential weaknesses that deserve management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan. However, the loss potential does not warrant substandard classification.
Substandard - Loans in this category have well-defined weaknesses that jeopardize normal repayment of principal and interest. Prompt corrective action is required to reduce exposure and to assure adequate remedial actions are taken by the borrower. If these weaknesses do not improve, loss is possible.
Doubtful - Loans in this category have well-defined weaknesses that make full collection improbable.
Loss - Loans classified in this category are considered uncollectible and charged-off to the ACL.
As of December 31, 2024, the Company had no loans classified as doubtful or loss. The following table summarizes loans by risk rating and year of origination as of December 31, 2024, and gross charge-offs for the year ended December 31, 2024:
Year of Origination
(in thousands)20242023202220212020Prior YearsRevolving LinesTotal
Real estate:
Commercial real estate
Pass$141,677 $107,788 $242,693 $208,595 $68,371 $85,212 $22,731 $877,067 
Special Mention2,883 221 1,475 — — 658 — 5,237 
Substandard725 — 194 684 — 734 — 2,337 
Total$145,285 $108,009 $244,362 $209,279 $68,371 $86,604 $22,731 $884,641 
One-to-four family residential
Pass$92,621 $104,575 $117,750 $111,730 $78,869 $86,432 $19,294 $611,271 
Special Mention125 — — 798 — 255 — 1,178 
Substandard— 63 369 42 33 785 810 2,102 
Total$92,746 $104,638 $118,119 $112,570 $78,902 $87,472 $20,104 $614,551 
Construction and development
Pass$79,431 $51,997 $15,031 $3,629 $672 $1,514 $1,799 $154,073 
Special Mention— — — — — — — — 
Substandard— 918 — — — 238 — 1,156 
Total$79,431 $52,915 $15,031 $3,629 $672 $1,752 $1,799 $155,229 
Commercial and industrial
Pass$85,573 $43,242 $32,024 $38,991 $7,619 $1,356 $115,704 $324,509 
Special Mention646 — 1,191 — — — 78 1,915 
Substandard26 2 58 11 2 78 485 662 
Total$86,245 $43,244 $33,273 $39,002 $7,621 $1,434 $116,267 $327,086 
Tax-exempt
Pass$2,510 $1,893 $14,976 $6,626 $10,811 $28,114 $— $64,930 
Special Mention— — — — — — — — 
Substandard— — — — — — — — 
Total$2,510 $1,893 $14,976 $6,626 $10,811 $28,114 $— $64,930 
Consumer
Pass$15,638 $7,316 $3,009 $869 $335 $183 $1,135 $28,485 
Special Mention— — — — — — — — 
Substandard— 10 — — — 74 7 91 
Total$15,638 $7,326 $3,009 $869 $335 $257 $1,142 $28,576 
Total loans HFI$421,855 $318,025 $428,770 $371,975 $166,712 $205,633 $162,043 $2,075,013 
Gross charge-offs$13 $27 $37 $1 $— $312 $413 $803 
As of December 31, 2023, the Company had no loans classified as doubtful or loss. The following table summarizes loans by risk rating and year of origination as of December 31, 2023, and gross charge-offs for the year ended December 31, 2023:
Year of Origination
(in thousands)20232022202120202019Prior YearsRevolving LinesTotal
Real estate:
Commercial real estate
Pass$124,134 $256,707 $239,364 $76,754 $63,475 $61,957 $18,467 $840,858 
Special Mention73 — 3,186 — 1,031 4,082 — 8,372 
Substandard184 779 675 — — 714 — 2,352 
Total$124,391 $257,486 $243,225 $76,754 $64,506 $66,753 $18,467 $851,582 
One-to-four family residential
Pass$122,004 $134,583 $129,388 $90,190 $31,110 $74,077 $16,472 $597,824 
Special Mention— — — — — 261 — 261 
Substandard— 79 — 37 385 827 74 1,402 
Total$122,004 $134,662 $129,388 $90,227 $31,495 $75,165 $16,546 $599,487 
Construction and development
Pass$54,189 $55,515 $10,333 $1,742 $2,158 $1,015 $286 $125,238 
Special Mention— — — — — — — — 
Substandard— — — — — — — — 
Total$54,189 $55,515 $10,333 $1,742 $2,158 $1,015 $286 $125,238 
Commercial and industrial
Pass$73,653 $49,637 $51,012 $13,863 $7,409 $813 $107,171 $303,558 
Special Mention1,208 937 4,659 — 310 509 3,173 10,796 
Substandard4 — 59 5 54 51 800 973 
Total$74,865 $50,574 $55,730 $13,868 $7,773 $1,373 $111,144 $315,327 
Tax-exempt
Pass$959 $15,679 $8,174 $13,919 $4,250 $29,932 $— $72,913 
Special Mention— — — — — — — — 
Substandard— — — — — — — — 
Total$959 $15,679 $8,174 $13,919 $4,250 $29,932 $— $72,913 
Consumer
Pass$16,947 $6,385 $2,325 $858 $363 $133 $1,173 $28,184 
Special Mention— — — — — — — — 
Substandard— 29 — — — 90 8 127 
Total$16,947 $6,414 $2,325 $858 $363 $223 $1,181 $28,311 
Total loans HFI$393,355 $520,330 $449,175 $197,368 $110,545 $174,461 $147,624 $1,992,858 
Gross charge-offs$12 $20 $1 $— $10 $25 $405 $473 
Commitments to Extend Credit
Commitments to extend credit are agreements to lend to a customer if all conditions of the commitment have been met. Commitments generally have fixed expiration dates or other termination clauses and may require the payment of a fee. Since many of the commitments are expected to expire without being drawn upon, the total commitment amounts do not necessarily represent future cash requirements. The Company evaluates each customer’s creditworthiness on a case-by-case basis. The amount of collateral obtained, if it is deemed necessary by the Company upon extension of credit, is based on management’s evaluation of the customer’s ability to repay. Unfunded loan commitments totaled approximately $509.6 million and $372.0 million as of December 31, 2024 and 2023, respectively.
Standby letters of credit are conditional commitments issued by the Company to guarantee the performance of a customer to a third party. Those guarantees are primarily issued to support public and private borrowing arrangements, including
commercial paper, bond financing, and similar transactions. Commitments under standby letters of credit totaled approximately $11.9 million and $15.4 million as of December 31, 2024 and 2023, respectively. The credit risk involved in issuing letters of credit is essentially the same as that involved in extending loan facilities to customers.
Effective January 1, 2023, the Company adopted the provision of ASC 326 using the modified retrospective method and established a reserve for unfunded commitments. The Company estimates expected credit losses over the contractual period in which the Company is exposed to credit risk through a contractual obligation to extend credit, unless that obligation is unconditionally cancellable by the Company. The reserve for unfunded commitments is recorded within accrued expenses and other liabilities on the consolidated balance sheets, and the related provision is recorded in provision for credit losses on the consolidated statements of income. The estimate includes consideration of the likelihood that funding will occur and an estimate of expected credit losses on commitments expected to be funded over its estimated life. The loss rates computed for each pool and expected pool-level funding rates are applied to the related unfunded commitment balance to obtain the reserve amount. As of December 31, 2024 and December 31, 2023, the reserve on unfunded commitments was $642,000 and $442,000, respectively.
The following table summarizes the reserve for unfunded commitments for the periods indicated:
As of and for the Years Ended December 31,
(in thousands)20242023
Reserve for unfunded commitments at beginning of period$442 $— 
Provision for credit losses(1,2)
200 — 
Impact of ASC 326 adoption
— 442 
Reserve for unfunded commitments at end of period$642 $442 
(1)The $1.2 million provision for credit losses on the consolidated statements of income for the year ended December 31, 2024, includes $1.0 million for loans and $200,000 for unfunded loan commitments.
(2)The $735,000 provision for credit losses on the consolidated statements of income for the year ended December 31, 2023, is all for loans.