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Loans and Allowance for Credit Losses on Loans - (Tables)
 3 Months Ended
Mar. 31, 2022
Receivables [Abstract]  
Schedule of Loans by Class
The following table presents the amortized cost of loans by class as of March 31, 2022 and December 31, 2021.
(in thousands)March 31, 2022December 31, 2021
Commercial and industrial$248,625 $301,602 
Real estate:
  Commercial owner-occupied391,924 392,345 
  Commercial investor-owned1,176,918 1,189,021 
  Construction131,015 119,840 
  Home equity88,092 88,746 
  Other residential114,277 114,558 
Installment and other consumer loans51,003 49,533 
Total loans, at amortized cost 1
2,201,854 2,255,645 
Allowance for credit losses on loans(22,547)(23,023)
Total loans, net of allowance for credit losses on loans$2,179,307 $2,232,622 
1 Amortized cost includes net deferred loan origination costs (fees) of $690 thousand and $(901) thousand at March 31, 2022 and December 31, 2021, respectively. Amounts are also net of unrecognized purchase discounts of $2.6 million and $2.5 million at March 31, 2022 and December 31, 2021, respectively. Amortized cost excludes accrued interest, which totaled $6.2 million and $7.1 million at March 31, 2022 and December 31, 2021, respectively, and is included in interest receivable and other assets in the consolidated statements of condition.
Financing Receivable Credit Quality Indicators
The following tables present the loan portfolio by loan class, origination year and internal risk rating as of March 31, 2022 and December 31, 2021. We early adopted the vintage disclosure requirements of ASU 2022-02 prospectively as described in Note 2 beginning with the first quarter of 2022. Accordingly, the 2022 vintage table reflects gross charge-offs by loan class and year of origination. Generally, existing term loans that were re-underwritten are reflected in the table in the year of renewal. Lines of credit that have a conversion feature at the time of origination, such as construction to perm loans, are presented by year of origination.
(in thousands)Term Loans - Amortized Cost by Origination YearRevolving Loans Amortized Cost
March 31, 202220222021202020192018PriorTotal
Commercial and industrial:
Pass and Watch$2,563 $44,716 $12,583 $24,654 $7,862 $30,950 $112,839 $236,167 
Special Mention— — — 530 4,330 — 3 4,863 
Substandard— — 1,576 — — — 6,019 7,595 
Total commercial and industrial$2,563 $44,716 $14,159 $25,184 $12,192 $30,950 $118,861 $248,625 
Commercial real estate, owner-occupied:
Pass and Watch$14,542 $53,334 $43,851 $47,384 $35,681 $151,304 $— $346,096 
Special Mention6,215 16,471 — 1,763 5,419 5,152 — 35,020 
Substandard— — 7,162 — — 3,536 — 10,698 
Doubtful— — 110 — — — — 110 
Total commercial real estate, owner-occupied$20,757 $69,805 $51,123 $49,147 $41,100 $159,992 $— $391,924 
(in thousands)Term Loans - Amortized Cost by Origination YearRevolving Loans Amortized Cost
March 31, 202220222021202020192018PriorTotal
Commercial real estate, investor-owned:
Pass and Watch$42,615 $222,832 $177,077 $177,477 $141,444 $374,554 $78 $1,136,077 
Special Mention— — 1,213 2,714 9,761 9,621 — 23,309 
Substandard— — — — — 17,532 — 17,532 
Total commercial real estate, investor-owned$42,615 $222,832 $178,290 $180,191 $151,205 $401,707 $78 $1,176,918 
Construction:
Pass and Watch$2,708 $30,721 $79,544 $8,933 $9,109 $— $— $131,015 
Total construction$2,708 $30,721 $79,544 $8,933 $9,109 $— $— $131,015 
Home equity:
Pass and Watch$— $24 $— $— $— $320 $87,173 $87,517 
Special Mention— — — — — — 66 66 
Substandard— — — — — 370 139 509 
Total home equity$— $24 $— $— $— $690 $87,378 $88,092 
Other residential:
Pass and Watch$5,249 $15,690 $31,776 $24,342 $14,848 $22,372 $— $114,277 
Total other residential$5,249 $15,690 $31,776 $24,342 $14,848 $22,372 $— $114,277 
Installment and other consumer:
Pass and Watch$6,038 $15,852 $7,074 $8,219 $4,873 $7,103 $1,828 $50,987 
Substandard— — — — — 16 — 16 
Total installment and other consumer$6,038 $15,852 $7,074 $8,219 $4,873 $7,119 $1,828 $51,003 
Gross current period charge-offs$— $— $— $— $— $— $2 $2 
Total loans:
Pass and Watch$73,715 $383,169 $351,905 $291,009 $213,817 $586,603 $201,918 $2,102,136 
Total Special Mention$6,215 $16,471 $1,213 $5,007 $19,510 $14,773 $69 $63,258 
Total Substandard$— $— $8,738 $— $— $21,454 $6,158 $36,350 
Total Doubtful$— $— $110 $— $— $— $— $110 
Totals$79,930 $399,640 $361,966 $296,016 $233,327 $622,830 $208,145 $2,201,854 
Total gross current period charge-offs$— $— $— $— $— $— $2 $2 
(in thousands)Term Loans - Amortized Cost by Origination YearRevolving Loans Amortized Cost
December 31, 202120212020201920182017PriorTotal
Commercial and industrial:
Pass and Watch$96,643 $35,967 $25,754 $12,763 $2,729 $31,280 $90,744 $295,880 
Special Mention— 1,700 584 273 — — 2,088 4,645 
Substandard— — — — — — 1,077 1,077 
Total commercial and industrial$96,643 $37,667 $26,338 $13,036 $2,729 $31,280 $93,909 $301,602 
Commercial real estate, owner-occupied:
Pass and Watch$58,395 $43,216 $49,485 $36,174 $42,430 $104,898 $— $334,598 
Special Mention16,748 — — 7,846 — 16,996 — 41,590 
Substandard— 7,155 285 — — 8,603 — 16,043 
Doubtful— 114 — — — — — 114 
Total commercial real estate, owner-occupied$75,143 $50,485 $49,770 $44,020 $42,430 $130,497 $— $392,345 
Commercial real estate, investor-owned:
Pass and Watch$225,722 $186,214 $187,418 $143,028 $75,419 $325,882 $84 $1,143,767 
Special Mention— 1,214 2,714 11,773 1,787 9,540 — 27,028 
Substandard— — — 695 — 17,531 — 18,226 
Total commercial real estate, investor-owned$225,722 $187,428 $190,132 $155,496 $77,206 $352,953 $84 $1,189,021 
Construction:
Pass and Watch$31,269 $70,528 $8,935 $9,108 $— $— $— $119,840 
Total construction$31,269 $70,528 $8,935 $9,108 $— $— $— $119,840 
Home equity:
Pass and Watch$— $— $— $— $10 $268 $87,693 $87,971 
Substandard— — — — — 377 398 775 
Total home equity$— $— $— $— $10 $645 $88,091 $88,746 
Other residential:
Pass and Watch$15,800 $31,981 $25,529 $15,411 $7,964 $17,873 $— $114,558 
Total other residential$15,800 $31,981 $25,529 $15,411 $7,964 $17,873 $— $114,558 
Installment and other consumer:
Pass and Watch$17,207 $7,748 $9,436 $5,633 $1,123 $6,620 $1,766 $49,533 
Total installment and other consumer$17,207 $7,748 $9,436 $5,633 $1,123 $6,620 $1,766 $49,533 
Total loans:
Pass and Watch$445,036 $375,654 $306,557 $222,117 $129,675 $486,821 $180,287 $2,146,147 
Total Special Mention$16,748 $2,914 $3,298 $19,892 $1,787 $26,536 $2,088 $73,263 
Total Substandard$— $7,155 $285 $695 $— $26,511 $1,475 $36,121 
Doubtful$— $114 $— $— $— $— $— $114 
Totals$461,784 $385,837 $310,140 $242,704 $131,462 $539,868 $183,850 $2,255,645 
Past Due Financing Receivables
The following table shows the amortized cost of loans by class, payment aging and non-accrual status as of March 31, 2022 and December 31, 2021.
Loan Aging Analysis by Class
(in thousands)Commercial and industrialCommercial real estate, owner-occupiedCommercial real estate, investor-ownedConstructionHome equityOther residentialInstallment and other consumerTotal
March 31, 2022        
 30-59 days past due$435 $324 $— $— $399 $635 $337 $2,130 
 60-89 days past due341 — — — 100 — 2 443 
 90 days or more past due— — — 54 — 16 70 
Total past due776 324 — — 553 635 355 2,643 
Current247,849 391,600 1,176,918 131,015 87,539 113,642 50,648 2,199,211 
Total loans 1
$248,625 $391,924 $1,176,918 $131,015 $88,092 $114,277 $51,003 $2,201,854 
Non-accrual loans 2
$— $7,272 $— $— $390 $— $16 $7,678 
Non-accrual loans with no allowance$— $7,272 $— $— $390 $— $16 $7,678 
December 31, 2021        
 30-59 days past due$2 $— $— $— $498 $— $1,036 $1,536 
 60-89 days past due394 — — — 67 — — 461 
 90 days or more past due229 — — — 88 — — 317 
Total past due625 — — — 653 — 1,036 2,314 
Current300,977 392,345 1,189,021 119,840 88,093 114,558 48,497 2,253,331 
Total loans 1
$301,602 $392,345 $1,189,021 $119,840 $88,746 $114,558 $49,533 $2,255,645 
Non-accrual loans 2
$— $7,269 $694 $— $413 $— $— $8,376 
Non-accrual loans with no allowance$— $7,269 $694 $— $413 $— $— $8,376 
1 There were no loans past due more than ninety days accruing interest at March 31, 2022. There were two SBA PPP loans past due more than ninety days totaling $229 thousand accruing interest as of December 31, 2021 for which we requested "guarantee" payment from the SBA. The SBA subsequently purchased both loans in January 2022.
2 None of the non-accrual loans as of March 31, 2022 or December 31, 2021 were earning interest on a cash basis. We recognized no interest income on non-accrual loans for the three months ended March 31, 2022 and 2021. There was one loan with amortized cost of $16 thousand placed on non-accrual status during the three months ended March 31, 2022 for which we reversed less than one thousand in interest income at the time of change in status. There were no loans placed on non-accrual status during the three months ended March 31, 2021.
Schedule of Collateral Dependent Loans
The following table presents the amortized cost basis of individually analyzed collateral-dependent non-accrual loans by class at March 31, 2022 and December 31, 2021.
Amortized Cost by Collateral Type
(in thousands)Commercial Real EstateResidential Real EstateOtherTotalAllowance for Credit Losses
March 31, 2022
Commercial real estate, owner-occupied$7,272 $— $— $7,272 $— 
Home equity— 390 — 390 — 
Installment and other consumer— — 16 16 $— 
Total$7,272 $390 $16 $7,678 $— 
December 31, 2021
Commercial real estate, owner-occupied$7,269 $— $— $7,269 $— 
Commercial real estate, investor-owned694 — — 694 — 
Home equity— 413 — 413 — 
Total$7,963 $413 $— $8,376 $— 
Troubled Debt Restructurings on Financing Receivables
The following table summarizes the amortized cost of TDR loans by loan class as of March 31, 2022 and December 31, 2021.
(in thousands)March 31, 2022December 31, 2021
Commercial and industrial$1,180 $1,183 
Commercial real estate, owner-occupied7,162 7,155 
Commercial real estate, investor-owned175 179 
Home equity379 386 
Installment and other consumer596 607 
Total 1
$9,492 $9,510 
1TDR loans on non-accrual status totaled $7.4 million at both March 31, 2022 and December 31, 2021. Unfunded commitments for TDR loans totaled $241 thousand and $441 thousand as of March 31, 2022 and December 31, 2021, respectively.
Allowance for Credit Losses on Financing Receivables
The following table discloses activity in the allowance for credit losses on loans for the periods presented.
Allowance for Credit Losses on Loans Rollforward
(in thousands)Commercial and industrialCommercial real estate, owner-occupiedCommercial real estate, investor-ownedConstructionHome equityOther residentialInstallment and other consumerUnallocatedTotal
Three months ended March 31, 2022
Beginning balance$1,709 $2,776 $12,739 $1,653 $595 $644 $621 $2,286 $23,023 
Provision (reversal)72 (154)(438)56 (46)(16)22 19 (485)
Charge-offs— — — — — — (2)— (2)
Recoveries3 — — 8 — — — — 11 
Ending balance$1,784 $2,622 $12,301 $1,717 $549 $628 $641 $2,305 $22,547 
Three months ended March 31, 2021
Beginning balance$2,530 $2,778 $12,682 $1,557 $738 $998 $291 $1,300 $22,874 
Provision (reversal)(880)(474)(1,826)(254)(218)(241)(36)1,000 (2,929)
Charge-offs— — — — — — — — — 
Recoveries4 — — 9 — — — — 13 
Ending balance$1,654 $2,304 $10,856 $1,312 $520 $757 $255 $2,300 $19,958