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Loans and Allowance for Credit Losses

12 Months Ended

Dec. 31, 2023

NOTE 4 – Loans and Allowance for Credit Losses

The Company makes loans to individuals and small businesses for various personal and commercial purposes primarily in the Upstate, Midlands, and Lowcountry regions of South Carolina, the Triangle,Triad, and Charlotte regions of North Carolina as well as Atlanta, Georgia. The Company’s loan portfolio is not concentrated in loans to any single borrower or a relatively small number of borrowers. The Company focuses its lending activities on businesses and individuals that reside in the markets that we serve. The principal component of the loan portfolio is loans secured by real estate mortgages which account for 84.8% of total loans at December 31, 2023. Commercial loans comprise 56.5% of total real estate loans and consumer loans account for 43.5%. Commercial real estate loans are further categorized into owner occupied which represents 17.5% of total loans and non-owner occupied loans which represents 26.2%. Commercial construction loans represent only 4.2% of the total loan portfolio.

In addition to monitoring potential concentrations of loans to particular borrowers or groups of borrowers, industries and geographic regions, management monitors exposure to credit risk from concentrations of lending products and practices

such as loans that subject borrowers to substantial payment increases (e.g. principal deferral periods, loans with initial interest-only periods, etc.), and loans with high loan-to-value ratios. Additionally, there are industry practices that could subject the Company to increased credit risk should economic conditions change over the course of a loan’s life. For example, the Company makes variable rate loans and fixed rate principal-amortizing loans with maturities prior to the loan being fully paid (i.e. balloon payment loans). The various types of loans are individually underwritten and monitored to manage the associated risks.

Loan Portfolio Composition

The following table summarizes the composition of our loan portfolio. Total gross loans are recorded net of deferred loan fees and costs, which totaled $7.0 million and $7.3 million as of December 31, 2023 and December 31, 2022, respectively.



	December 31
(dollars in thousands) Commercial [Member]	2023							2022
Commercial
Owner occupied REOwner occupied RE [Member]	$	631,657		17.5	%	612,901			18.7	%
Non-owner occupied RENon-owner occupied RE [Member]		942,529		26.2	%	862,579			26.3	%
ConstructionConstruction [Member]		150,680		4.2	%	109,726			3.4	%
BusinessBusiness [Member]		500,161		13.9	%	468,112			14.3	%
Total commercial loansConsumer [Member]		2,225,027		61.8	%	2,053,318			62.7	%
Consumer
Real estate Real estate [Member]		1,082,429		30.0	%	931,278			28.4	%
Home equity Home equity [Member]		183,004		5.1	%	179,300			5.5	%
Construction Construction [Member]		63,348		1.7	%	80,415			2.5	%
Other Other [Member]		48,819		1.4	%	29,052			0.9	%
Total consumer loans		1,377,600		38.2	%	1,220,045			37.3	%
Total gross loans, net of deferred fees		3,602,627		100.0	%	3,273,363			100.0	%
Less – allowance for credit losses		(40,682	)			(38,639	)
Total loans, net	$	3,561,945				3,234,724

The composition of gross loans by rate type is as follows:


	December 31,
(dollars in thousands)	2023		2022
Floating rate loans	$	574,352		439,287
Fixed rate loans		3,028,275		2,834,076
	$	3,602,627		3,273,363

At December 31, 2023, approximately $1.25 billion of the Company’s mortgage loans were pledged as collateral for advances from the FHLB, as set forth in Note 8.

Credit Quality Indicators

The Company tracks credit quality based on its internal risk ratings. Upon origination, a loan is assigned an initial risk grade, which is generally based on several factors such as the borrower’s credit score, the loan-to-value ratio, the debt-to-income ratio, etc. After loans are initially graded, they are monitored regularly for credit quality based on many factors, such as payment history, the borrower’s financial status, and changes in collateral value. Loans can be downgraded or upgraded depending on management’s evaluation of these factors. Internal risk-grading policies are consistent throughout each loan type.

A description of the general characteristics of the risk grades is as follows:

	●	Pass— A pass loan ranges from minimal to average credit risk; however, still has acceptable credit risk.

	●	Watch— A watch loan exhibits above average credit risk due to minor weaknesses and warrants closer scrutiny by management.

	●	Special mention—A special mention loan has 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 or the institution’s credit position at some future date.

	●	Substandard— A substandard loan is inadequately protected by the current sound worth and paying capacity of the obligor or of the collateral pledged, if any. Loans so classified must have a well-defined weakness, or weaknesses, which may jeopardize the liquidation of the debt. A substandard loan is characterized by the distinct possibility that the Bank will sustain some loss if the deficiencies are not corrected.

	●	Doubtful— A doubtful loan has all of the weaknesses inherent in one classified as substandard with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of the currently existing facts, conditions and values, highly questionable and improbable.

The following table presents loan balances classified by credit quality indicators by year of origination as of December 31, 2023.


	December 31, 2023
(dollars in thousands)	2023		2022			2021		2020			2019		Prior			Revolving			Revolving Converted to Term			Total
Commercial
Owner occupied RE
Pass	$	42,846		180,654			138,549		64,818			59,880		110,502			85			166			597,500
Watch		-		3,460			460		15,997			3,525		6,616			-			-			30,058
Special Mention		-		181			-		-			-		3,057			-			-			3,238
Substandard		-		-			-		-			-		861			-			-			861
Total Owner occupied RE		42,846		184,295			139,009		80,815			63,405		121,036			85			166			631,657

Non-owner occupied RE
Pass		84,617		298,063			162,697		107,364			59,260		163,990			9,249			-			885,240
Watch		1,007		3,260			9,914		533			5,545		10,630			-			-			30,889
Special Mention		-		-			7,759		-			8,252		879			-			-			16,890
Substandard		-		-			313		-			8,088		1,109			-			-			9,510
Total Non-owner occupied RE		85,624		301,323			180,683		107,897			81,145		176,608			9,249			-			942,529

Construction
Pass		27,262		86,161			24,399		11,459			-		-			-			-			149,281
Watch		-		1,399			-		-			-		-			-			-			1,399
Special Mention		-		-			-		-			-		-			-			-			-
Substandard		-		-			-		-			-		-			-			-			-
Total Construction		27,262		87,560			24,399		11,459			-		-			-			-			150,680

Business
Pass		48,705		134,999			48,557		18,868			17,292		47,708			146,745			1,431			464,305
Watch		127		15,867			1,833		1,010			842		3,584			7,570			506			31,339
Special Mention		241		961			98		857			184		447			150			97			3,035
Substandard		-		-			155		-			132		1,195			-			-			1,482
Total Business		49,073		151,827			50,643		20,735			18,450		52,934			154,465			2,034			500,161
Total Commercial loans		204,805		725,005			394,734		220,906			163,000		350,578			163,799			2,200			2,225,027

Consumer
Real estate
Pass		144,179		273,585			278,138		176,395			66,087		105,383			-			-			1,043,767
Watch		490		5,658			8,230		3,917			2,051		3,890			-			-			24,236
Special Mention		143		2,499			1,657		1,291			2,220		3,360			-			-			11,170
Substandard		-		-			635		817			318		1,486			-			-			3,256
Total Real estate		144,812		281,742			288,660		182,420			70,676		114,119			-			-			1,082,429

Home equity
Pass		-		-			-		-			-		-			171,003			-			171,003
Watch		-		-			-		-			-		-			6,393			-			6,393
Special Mention		-		-			-		-			-		-			4,283			-			4,283
Substandard		-		-			-		-			-		-			1,325			-			1,325
Total Home equity		-		-			-		-			-		-			183,004			-			183,004

Construction
Pass		14,339		39,893			9,116		-			-		-			-			-			63,348
Watch		-		-			-		-			-		-			-			-			-
Special Mention		-		-			-		-			-		-			-			-			-
Substandard		-		-			-		-			-		-			-			-			-
Total Construction		14,339		39,893			9,116		-			-		-			-			-			63,348

Other
Pass		1,278		2,551			2,361		1,457			803		2,604			36,549			-			47,603
Watch		9		29			348		-			15		163			58			-			622
Special Mention		33		333			-		-			23		82			41			-			512
Substandard		-		-			75		-			-		-			7			-			82
Total Other		1,320		2,913			2,784		1,457			841		2,849			36,655			-			48,819
Total Consumer loans		160,471		324,548			300,560		183,877			71,517		116,968			219,659			-			1,377,600
Total loans	$	365,276		1,049,553			695,294		404,783			234,517		467,546			383,458			2,200			3,602,627
Current period gross write-offs		-		(200	)		-		(28	)		-		(42	)		(469	)		(22	)		(761	)

The following table presents loan balances classified by credit quality indicators and loan categories as of December 31, 2022.


	December 31, 2022
(dollars in thousands)	2022		2021			2020		2019			2018		Prior			Revolving			Revolving Converted to Term		Total
Commercial
Owner occupied RE
Pass	$	169,083		122,654			85,867		66,299			36,718		93,915			-			-		574,536
Watch		14,648		479			9,339		3,658			-		6,792			-			-		34,916
Special Mention		200		-			-		-			-		2,960			-			-		3,160
Substandard		-		-			-		-			289		-			-			-		289
Total Owner occupied RE		183,931		123,133			95,206		69,957			37,007		103,667			-			-		612,901

Non-owner occupied RE
Pass		281,890		169,599			113,264		59,550			79,722		106,967			604			137		811,733
Watch		1,061		9,491			-		10,683			1,408		11,660			-			-		34,303
Special Mention		-		202			-		6,087			-		930			-			-		7,219
Substandard		-		134			-		7,992			327		871			-			-		9,324
Total Non-owner occupied RE		282,951		179,426			113,264		84,312			81,457		120,428			604			137		862,579

Construction
Pass		48,420		55,129			4,811		247			-		-			-			-		108,607
Watch		1,119		-			-		-			-		-			-			-		1,119
Special Mention		-		-			-		-			-		-			-			-		-
Substandard		-		-			-		-			-		-			-			-		-
Total Construction		49,539		55,129			4,811		247			-		-			-			-		109,726

Business
Pass		136,489		57,804			29,864		21,807			35,249		28,914			136,337			709		447,174
Watch		3,186		2,058			1,318		1,282			179		3,074			3,783			439		15,319
Special Mention		1,137		260			386		210			-		252			115			642		3,002
Substandard		498		-			188		233			315		911			472			-		2,617
Total Business		141,310		60,122			31,756		23,533			35,743		33,151			140,707			1,790		468,112
Total Commercial loans		657,731		417,810			245,037		178,049			154,207		257,246			141,311			1,927		2,053,318

Consumer
Real estate
Pass		243,589		269,565			189,075		72,499			39,042		76,172			-			-		889,942
Watch		6,196		8,256			3,847		2,278			494		3,671			-			-		24,742
Special Mention		3,114		1,938			2,644		2,258			955		2,639			-			-		13,548
Substandard		-		648			227		341			408		1,422			-			-		3,046
Total Real estate		252,899		280,407			195,793		77,376			40,899		83,904			-			-		931,278

Home equity
Pass		-		-			-		-			-		-			165,847			-		165,847
Watch		-		-			-		-			-		-			7,226			-		7,226
Special Mention		-		-			-		-			-		-			4,055			-		4,055
Substandard		-		-			-		-			-		-			2,172			-		2,172
Total Home equity		-		-			-		-			-		-			179,300			-		179,300

Construction
Pass		41,138		34,039			4,923		-			-		-			-			-		80,100
Watch		-		-			-		-			-		-			-			-		-
Special Mention		-		-			-		315			-		-			-			-		315
Substandard		-		-			-		-			-		-			-			-		-
Total Construction		41,138		34,039			4,923		315			-		-			-			-		80,415

Other
Pass		3,894		3,038			1,702		1,534			341		3,015			14,465			-		27,989
Watch		46		367			15		5			16		175			93			-		717
Special Mention		94		-			-		44			75		23			97			-		332
Substandard		-		-			-		5			-		-			9			-		14
Total Other		4,034		3,405			1,717		1,588			432		3,213			14,663			-		29,052
Total Consumer loans		298,071		317,851			202,433		79,279			41,331		87,117			193,963			-		1,220,045
Total loans	$	955,802		735,661			447,470		257,328			195,538		344,363			335,274			1,927		3,273,363
Current period gross write-offs		-		(91	)		-		(23	)		-		(32	)		(339	)		-		(485	)

The following tables present loan balances by payment status.


	December 31, 2023
(dollars in thousands)	Accruing 30-59 days past due		Accruing 60-89 days past due		Accruing 90 days or more past due		Nonaccrual loans		Accruing current		Total
Commercial
Owner occupied RE	$	74		-		-		-		631,583		631,657
Non-owner occupied RE		8,102		-		-		1,423		933,004		942,529
Construction		-		-		-		-		150,680		150,680
Business		567		-		-		319		499,275		500,161
Consumer
Real estate		1,750		-		-		985		1,079,694		1,082,429
Home equity		601		30		-		1,236		181,137		183,004
Construction		-		-		-		-		63,348		63,348
Other		25		25		-		-		48,769		48,819
Total loans	$	11,119		55		-		3,963		3,587,490		3,602,627

		December 31, 2022
(dollars in thousands)		Accruing 30-59 days past due		Accruing 60-89 days past due		Accruing 90 days or more past due		Nonaccrual loans		Accruing current		Total
Commercial
Owner occupied RE	$	-		-		-		-		612,901		612,901
Non-owner occupied RE		119		757		-		247		861,456		862,579
Construction		-		-		-		-		109,726		109,726
Business		24		1		-		182		467,905		468,112
Consumer
Real estate		330		-		-		1,099		929,849		931,278
Home equity		50		-		-		1,099		178,151		179,300
Construction		-		-		-		-		80,415		80,415
Other		88		-		-		-		28,964		29,052
Total loans	$	611		758		-		2,627		3,269,367		3,273,363

As of December 31, 2023 and December 31, 2022, loans 30 days or more past due represented 0.37% and 0.11% of the Company’s total loan portfolio, respectively. Commercial loans 30 days or more past due were 0.27% and 0.03% of the Company’s total loan portfolio as of December 31, 2023 and December 31, 2022, respectively. Consumer loans 30 days or more past due were 0.09% and 0.08% of total loans as of December 31, 2023 and December 31, 2022, respectively. The increase in accruing 30-59 days past due at December 31, 2023 primarily relates to one commercial relationship totaling $8.1 million.

Nonperforming assets

The following table shows the nonperforming assets and the related percentage of nonperforming assets to total assets and gross loans. Generally, a loan is placed on nonaccrual status when it becomes 90 days past due as to principal or interest, or when we believe, after considering economic and business conditions and collection efforts, that the borrower’s financial condition is such that collection of the contractual principal or interest on the loan is doubtful. A payment of interest on a loan that is classified as nonaccrual is recognized as a reduction in principal when received.


	December 31,
(dollars in thousands)	2023			2022
Nonaccrual loans	$	3,963			831
Nonaccruing TDRs		-			1,796
Total nonaccrual loans, including nonaccruing TDRs		3,963			2,627
Other real estate owned		-			-
Total nonperforming assets	$	3,963			2,627
Nonperforming assets as a percentage of:
Total assets		0.10	%		0.07	%
Gross loans		0.11	%		0.08	%
Total loans over 90 days past due	$	1,300			402
Loans over 90 days past due and still accruing		-			-
Accruing troubled debt restructurings		-			4,503

The table below summarizes nonaccrual loans by major categories for the periods presented.


	December 31, 2023						December 31, 2022
(dollars in thousands)	Nonaccrual loans with no allowance		Nonaccrual loans with an allowance		Total nonaccrual loans		Nonaccrual loans with no allowance		Nonaccrual loans with an allowance		Total nonaccrual loans
Commercial
Owner occupied RE	$	-		-		-	$	-		-		-
Non-owner occupied RE		653		770		1,423		114		133		247
Construction		-		-		-		-		-		-
Business		164		155		319		-		182		182
Total commercial		817		925		1,742		114		315		429
Consumer
Real estate		-		985		985		-		1,099		1,099
Home equity		343		893		1,236		194		905		1,099
Construction		-		-		-		-		-		-
Other		-		-		-		-		-		-
Total consumer		343		1,878		2,221		194		2,004		2,198
Total nonaccrual loans	$	1,160		2,803		3,963	$	308		2,319		2,627

Foregone interest income on the nonaccrual loans for the year ended December 31, 2023 was approximately $73,000 and approximately $28,000 for the same period in 2022. Interest income recognized on nonaccrual loans was insignificant during the years ended December 31, 2023 and 2022.

Modifications to Borrowers Experiencing Financial Difficulty

The Company adopted Accounting Standards Update (“ASU”) 2022-02, Financial Instruments - Credit Losses (Topic 326) Troubled Debt Restructurings and Vintage Disclosures (“ASU 2022-02”) effective January 1, 2023. The amendments in ASU 2022-02 eliminated the recognition and measurement of troubled debt restructurings and enhanced disclosures for loan modifications to borrowers experiencing financial difficulty.

The allowance for credit losses incorporates an estimate of lifetime expected credit losses and is recorded on each asset upon origination or acquisition. The starting point for the estimate of the allowance for credit losses is historical loss information, which includes losses from modifications of receivables to borrowers experiencing financial difficulty. The

Company uses a probability of default/loss given default model to determine the allowance for credit losses. An assessment of whether a borrower is experiencing financial difficulty is made on the date of a modification. Because the effect of most modifications made to borrowers experiencing financial difficulty is already included in the allowance for credit losses because of the measurement methodologies used to estimate the allowance, a change to the allowance for credit losses is generally not recorded upon modification.

The following table shows the amortized cost basis of the loans modified to borrowers experiencing financial difficulty during the twelve months ended December 31, 2023, disaggregated by class of loans and type of concession granted and describes the financial effect of the modifications made to borrowers experiencing financial difficulty.

						Term Extension
(dollars in thousands)	Amortized Cost Basis		% of Total Loan Type			Financial Effect
Commercial Business	$	319		0.06	%	Added a 1-year term to both of the loans modified. One loan was granted an extended amortization due to the inability to pay on a 3-year amortization. The other loan was given an interest only period due to the ability to pay only interest to get the loan renewed.

Neither of the two loans modified had a payment default during the period. The Company closely monitors the performance of the loans that are modified for borrowers experiencing financial difficulty to understand the effectiveness of its modification efforts. Both loans are in current payment status since the loan modification occurred in the third quarter of 2023. There have been no commitments to lend additional funds to the borrowers experiencing financial difficulty as of December 31, 2023.

Prior to the adoption of ASU 2022-02, the Company considered a loan to be a TDR when a debtor experienced financial difficulty and the Company granted a concession to the debtor that it would not normally consider. Concessions related to the contractual interest rate, maturity date, or payment structure of the note. As part of our prior workout plan for individual loan relationships, we restructured loan terms to assist borrowers facing challenges in the current economic environment.

At December 31, 2022, our TDRs included 13 loans totaling $6.3 million with a specific allowance for credit losses of $1.2 million. One consumer real estate loan with a pre-modification and post-modification balance of $885,000and two commercial business loans with a pre-modification and post-modification balance totaling $1.1 million were considered new TDRs during the twelve months ended December 31, 2022.

As of December 31, 2022, there were no loans modified as a TDR for which there was a payment default (60 days past due) within 12 months of the restructuring date.

Allowance for Credit Losses

The following table summarizes the activity related to the allowance for credit losses for the year ended December 31, 2023 and December 31, 2022 under the CECL methodology. On January 1, 2022, we adopted the CECL methodology for estimating credit losses, which resulted in an increase of $1.5 million in our allowance for credit losses. The $2.2 million provision for credit losses for the 12 months ended December 31, 2023 was driven primarily by $329.3 million in loan growth for the year combined with lower expected loss rates due to historically low charge-offs during the year. The $5.4 million provision for credit losses for the 12 months ended December 31, 2022 was driven primarily by $783.5 million in loan growth for the year, as well as slightly lower expected loss rates and minor adjustments to two internal qualitative factors which increased the qualitative component of the allowance and related provision expense in 2022.



	Twelve months ended December 31, 2023
	Commercial										Consumer
(dollars in thousands)	Owner occupied RE		Non-owner occupied RE			Construction		Business			Real Estate		Home Equity			Construction			Other			Total
Balance, beginning of period	$	5,867		10,376			1,292		7,861			9,487		2,551			893			312			38,639
Provision for credit losses		251		848			302		(755	)		1,160		422			(216	)		197			2,209
Loan charge-offs		-		(242	)		-		(65	)		-		(438	)		-			(16	)		(761	)
Loan recoveries		-		185			-		344			-		65			-			1			595
Net loan recoveries (charge-offs)		-		(57	)		-		279			-		(373	)		-			(15	)		(166	)
Balance, end of period	$	6,118		11,167			1,594		7,385			10,647		2,600			677			494			40,682
Net charge-offs to average loans (annualized)																							0.00	%
Allowance for credit losses to gross loans																							1.13	%
Allowance for credit losses to nonperforming loans																							1026.55	%


	Twelve months ended December 31, 2022
	Commercial											Consumer
(dollars in thousands)	Owner occupied RE			Non-owner occupied RE			Construction		Business			Real Estate			Home Equity			Construction		Other			Total
Balance, beginning of period	$	4,700			10,518			625		4,887			7,083			1,697			578		320			30,408
Adjustment for CECL		(313	)		333			154		1,057			(294	)		438			130		(5	)		1,500
Provision for credit losses		1,480			(2,015	)		513		1,764			2,698			663			185		87			5,375
Loan charge-offs		-			-			-		(55	)		-			(339	)		-		(91	)		(485	)
Loan recoveries		-			1,540			-		208			-			92			-		1			1,841
Net loan recoveries (charge-offs)		-			1,540			-		153			-			(247	)		-		(90	)		1,356
Balance, end of period	$	5,867			10,376			1,292		7,861			9,487			2,551			893		312			38,639
Net recoveries to average loans (annualized)																								(0.05	%)
Allowance for credit losses to gross loans																								1.18	%
Allowance for credit losses to nonperforming loans																								1470.84	%

Prior to the adoption of ASC 326 on January 1, 2022, the Company calculated the allowance for loan losses under the incurred loss methodology. The following table summarizes the activity related to the allowance for loan losses in prior periods under this methodology.


	Twelve months ended December 31, 2021
	Commercial												Consumer
(dollars in thousands)	Owner occupied RE			Non-owner occupied RE			Construction			Business			Real Estate			Home Equity			Construction			Other			Total
Balance, beginning of period	$	8,092			12,050			1,154			7,870			10,482			3,248			746			507			44,149
Provision for credit losses		(3,486	)		(958	)		(529	)		(2,041	)		(3,417	)		(1,613	)		(168	)		(188	)		(12,400	)
Loan charge-offs		-			(837	)		-			(1,181	)		-			(139	)		-			(9	)		(2,166	)
Loan recoveries		94			263			-			239			18			201			-			10			825
Net loan recoveries (charge-offs)		94			(574	)		-			(942	)		18			62			-			1			(1,341	)
Balance, end of period	$	4,700			10,518			625			4,887			7,083			1,697			578			320			30,408

Collateral dependent loans are loans for which the repayment is expected to be provided substantially through the operation or sale of the collateral and the borrower is experiencing financial difficulty. The Company reviews individually evaluated loans for designation as collateral dependent loans, as well as other loans that management of the Company designates as having higher risk. These loans do not share common risk characteristics and are not included within the collectively evaluated loans for determining the allowance for credit losses.

Under CECL, for collateral dependent loans, the Company has adopted the practical expedient to measure the allowance for credit losses based on the fair value of collateral. The allowance for credit losses is calculated on an individual loan basis based on the shortfall between the fair value of the loan's collateral, which is adjusted for liquidation costs/discounts, and amortized cost. If the fair value of the collateral exceeds the amortized cost, no allowance is required.

The following table presents an analysis of collateral-dependent loans of the Company as of December 31, 2023 and December 31, 2022.


	December 31, 2023
(dollars in thousands)	Real estate		Business assets		Other		Total
Commercial
Owner occupied RE	$	-		-		-		-
Non-owner occupied RE		720		-		-		720
Construction		-		-		-		-
Business		164		-		-		164
Total commercial		884		-		-		884
Consumer
Real estate		166		-		-		166
Home equity		343		-		-		343
Construction		-		-		-		-
Other		-		-		-		-
Total consumer		509		-		-		509
Total	$	1,393		-		-		1,393

		December 31, 2022
(dollars in thousands)	Real estate		Business assets		Other		Total
Commercial
Owner occupied RE	$	-		-		-		-
Non-owner occupied RE		114		-		-		114
Construction		-		-		-		-
Business		30		-		-		30
Total commercial		144		-		-		144
Consumer
Real estate		207		-		-		207
Home equity		194		-		-		194
Construction		-		-		-		-
Other		-		-		-		-
Total consumer		401		-		-		401
Total	$	545		-		-		545

Allowance for Credit Losses - Unfunded Loan Commitments

The allowance for credit losses for unfunded loan commitments was $1.8 million and $2.8 million at December 31, 2023 and 2022, respectively, and is separately classified on the balance sheet within other liabilities. Prior to the adoption of CECL, the Company’s reserve for unfunded commitments was not material. The following table presents the balance and activity in the allowance for credit losses for unfunded loan commitments for the twelve months ended December 31, 2023 and December 31, 2022.


(dollars in thousands)	Twelve months ended December 31, 2023			Twelve months ended December 31, 2022
Balance, beginning of period	$	2,780			-
Adjustment for adoption of CECL		-			2,000
Provision for credit losses		(949	)		780
Balance, end of period	$	1,831			2,780
Unfunded Loan Commitments		724,606			878,324
Reserve for Unfunded Commitments to Unfunded Loan Commitments		0.25	%		0.32	%