Other Assets

12 Months Ended

Dec. 31, 2021

Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]

The Corporation is a limited partner in several limited partnership investments. The Corporation is not the general partner, does not have controlling ownership, and is not the primary beneficiary in any of these limited partnerships and the limited partnerships have not been consolidated. These investments are accounted for using the equity method of accounting and are evaluated for impairment at the end of each reporting period.

Historic Rehabilitation Tax Credits

The Corporation invests in development entities through BOC, Mitchell Street, and FBB Tax Credit, wholly-owned subsidiaries of FBB, to rehabilitate historic buildings. At December 31, 2021 and 2020, the net carrying value of the investments were $2.3 million and $2.4 million, respectively. During 2020, the Corporation contributed $4.4 million to these partnerships and recognized $2.8 million in federal historic tax credits, and $1.9 million in impairment related to these investments. During 2021, the Corporation had no activity related to these investments. The state historic tax credits received during the year ended December 31, 2020 was $2.7 million and were sold to a third party resulting in a gain on sale $275,000.

Low-Income Housing Tax Credits

The Corporation invests in development entities through FBB Tax Credit, wholly-owned subsidiaries of FBB, to develop buildings that offer low-income housing. At December 31, 2021, the net carrying value of the investments were $3.0 million. During 2021, the Corporation contributed $3.0 million to these partnerships, and did not recognize any tax credits or impairment related to these partnerships. As of December 31, 2020 the Corporation had no low-income housing tax credit investments.

New Market Tax Credits

The Corporation invested in a community development entity (“CDE”) through Rimrock Road, a wholly-owned subsidiary of FBB, to develop and operate a real estate project located in a low-income community. On November 24, 2021, the Corporation exercised the put option and exited the Rimrock Road entity. As of December 31, 2021, the Corporation had no remaining investment in the CDE. At December 31, 2020, Rimrock Road had one CDE investment with a net carrying value of $5.3 million. The Corporation’s use of the federal new market tax credit during the year ended December 31, 2020 was $450,000.

Other Investments

The Corporation had an equity investment in Aldine Capital Fund, LP, a mezzanine fund. As of December 31, 2020, the Corporation had an equity investment in Aldine Capital Fund, LP of $60,000 and the final distribution was received January 15, 2021. The Corporation’s equity investment in Aldine Capital Fund II, LP, also a mezzanine fund, totaled $4.9 million and $3.5 million as of December 31, 2021 and 2020, respectively. As of December 31, 2021, the Corporation had $1.3 million remaining of the original $5.0 million commitment to Aldine II. The Corporation’s equity investment in Aldine Capital Fund III, LP, also a mezzanine fund, totaled $4.5 million and $2.8 million as of December 31, 2021 and 2020, respectively. As of December 31, 2021, the Corporation had $1.1 million remaining of the $5.0 million commitment. The Corporation’s share of these partnerships’ income included in other non-interest income in the Consolidated Statements of Income for the years ended December 31, 2021 and 2020 was $2.5 million and $520,000, respectively. The Corporation’s share of these partnerships’ losses included in other non-interest expense in the Consolidated Statements of Income for the year ended December 31, 2021 and 2020 was $24,000 and $99,000, respectively.

The Corporation has an equity investment in Dane Workforce Housing Fund LLC, a Wisconsin limited liability company, focused on community development by providing affordable workforce housing units in Dane County, Wisconsin, of $367,000 and $275,000 recorded as of December 31, 2021 and 2020, respectively. The Corporation had a $615,000 commitment remaining of the original $1.0 million as of December 31, 2021. The Corporation’s share of the investment fund’s income included in other non-interest income in the Consolidated Statements of Income for the year ended December 31, 2021 was $2,000. The Corporation’s share of these partnerships’ losses included in other non-interest expense in the Consolidated Statements of Income for the year ended December 31, 2021 was $19,000. No activity was recognized for the year ended December 31, 2020.

The Corporation has an equity investment in BankTech Ventures, LP, a venture capital fund, focused on the community banking industry through strategic investments in growth-stage startups that directly support banking needs, of $120,000 recorded as of December 31, 2021. The Corporation had a $880,000 commitment remaining of the original $1.0 million as of December 31, 2021. No activity was recognized for the years ended December 31, 2021 and 2020.

The Corporation is the sole owner of $315,000 of common securities issued by Trust II. The purpose of Trust II was to complete the sale of $10.0 million of 10.50% fixed rate preferred securities. Trust II, a wholly owned subsidiary of the

Corporation, is not consolidated into the financial statements of the Corporation. The investment in Trust II of $315,000 as of December 31, 2021 and 2020 is included in accrued interest receivable and other assets.

A summary of accrued interest receivable and other assets was as follows:


	December 31, 2021		December 31, 2020
	(In Thousands)
Accrued interest receivable	$	5,497	$	8,564
Net deferred tax asset	6,175		7,217
Investment in historic development entities	2,299		2,356
Investment in low-income housing development entity	2,964		—
Investment in a community development entity	—		5,306
Investment in limited partnerships	9,874		6,673
Investment in Trust II	315		315
Prepaid expenses	2,689		2,165
Other assets	9,577		6,882
Total accrued interest receivable and other assets	$	39,390	$	39,478