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Loans and Allowance for Credit Losses | 3 Months Ended
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Mar. 31, 2025
Receivables [Abstract] |
Loans and Allowance for Credit Losses | NOTE 4 – Loans and Allowance for Credit Losses The following table summarizes the composition of our loan portfolio. Total gross loans are recorded net of deferred loan fees and costs, which totaled $6.0 million as of March 31, 2025 and $6.2 million as of December 31, 2024.
Schedule of composition of our loan portfolio |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | March 31, 2025 |  |  | December 31, 2024 |
(dollars in thousands)Commercial [Member] |  | Amount |  |  | % of Total |  |  | Amount |  |  | % of Total |
Commercial |  |  |  |  |  |  |  |  |  |  |  |
Owner occupied REOwner occupied RE [Member] |  | $ | 673,865 |  |  |  | 18.3 | % |  | $ | 651,597 |  |  |  | 17.9 | %
Non-owner occupied RE |  |  | 926,246 |  |  |  | 25.1 | % |  |  | 924,367 |  |  |  | 25.5 | %
ConstructionConstruction [Member] |  |  | 90,021 |  |  |  | 2.5 | % |  |  | 103,204 |  |  |  | 2.8 | %
Business |  |  | 561,337 |  |  |  | 15.2 | % |  |  | 556,117 |  |  |  | 15.3 | %
Total commercial loansConsumer [Member] |  |  | 2,251,469 |  |  |  | 61.1 | % |  |  | 2,235,285 |  |  |  | 61.5 | %
Consumer |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Real estateReal estate [Member] |  |  | 1,147,357 |  |  |  | 31.2 | % |  |  | 1,128,629 |  |  |  | 31.1 | %
Home equityHome equity [Member] |  |  | 223,061 |  |  |  | 6.1 | % |  |  | 204,897 |  |  |  | 5.6 | %
ConstructionNon-owner occupied RE [Member] |  |  | 23,540 |  |  |  | 0.6 | % |  |  | 20,874 |  |  |  | 0.6 | %
OtherOther [Member] |  |  | 38,492 |  |  |  | 1.0 | % |  |  | 42,082 |  |  |  | 1.2 | %
Total consumer loans |  |  | 1,432,450 |  |  |  | 38.9 | % |  |  | 1,396,482 |  |  |  | 38.5 | %
Total gross loans, net of deferred fees |  |  | 3,683,919 |  |  |  | 100.0 | % |  |  | 3,631,767 |  |  |  | 100.0 | %
Less—allowance for credit losses |  |  | (40,687 | ) |  |  |  |  |  |  | (39,914 | ) |  |  |  |
Total loans, net |  | $ | 3,643,232 |  |  |  |  |  |  | $ | 3,591,853 |  |  |  |  |
Maturities and Sensitivity of Loans to Changes in Interest Rates The information in the following tables summarizes the loan maturity distribution by type and related interest rate characteristics based on the contractual maturities of individual loans, including loans which may be subject to renewal at their contractual maturity. Renewal of such loans is subject to review and credit approval, as well as modification of terms upon maturity. Actual repayments of loans may differ from the maturities reflected below, because borrowers have the right to prepay obligations with or without prepayment penalties.
Schedule of loan maturity distribution by type and related interest rate |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | March 31, 2025 |
(dollars in thousands) |  | One year or less |  |  | After one but within five years |  |  | After five but within fifteen years |  |  | After fifteen years |  |  | Total |
Commercial |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Owner occupied RE |  | $ | 21,945 |  |  |  | 235,811 |  |  |  | 384,201 |  |  |  | 31,908 |  |  |  | 673,865 |
Non-owner occupied RE |  |  | 107,677 |  |  |  | 601,166 |  |  |  | 199,078 |  |  |  | 18,325 |  |  |  | 926,246 |
Construction |  |  | 21,274 |  |  |  | 61,081 |  |  |  | 7,666 |  |  |  | - |  |  |  | 90,021 |
Business |  |  | 126,041 |  |  |  | 296,487 |  |  |  | 134,590 |  |  |  | 4,219 |  |  |  | 561,337 |
Total commercial loans |  |  | 276,937 |  |  |  | 1,194,545 |  |  |  | 725,535 |  |  |  | 54,452 |  |  |  | 2,251,469 |
Consumer |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Real estate |  |  | 25,156 |  |  |  | 98,915 |  |  |  | 259,980 |  |  |  | 763,306 |  |  |  | 1,147,357 |
Home equity |  |  | 3,473 |  |  |  | 40,131 |  |  |  | 174,895 |  |  |  | 4,562 |  |  |  | 223,061 |
Construction |  |  | 10,313 |  |  |  | 2,172 |  |  |  | 8,782 |  |  |  | 2,273 |  |  |  | 23,540 |
Other |  |  | 5,667 |  |  |  | 30,764 |  |  |  | 1,292 |  |  |  | 769 |  |  |  | 38,492 |
Total consumer loans |  |  | 44,609 |  |  |  | 171,982 |  |  |  | 444,949 |  |  |  | 770,910 |  |  |  | 1,432,450 |
Total gross loans, net of deferred fees |  | $ | 321,546 |  |  |  | 1,366,527 |  |  |  | 1,170,484 |  |  |  | 825,362 |  |  |  | 3,683,919 |
|  |  |  |  |  |  |  | December 31, 2024 |
(dollars in thousands) |  | One year or less |  |  | After one but within five years |  |  | After five but within fifteen years |  |  | After fifteen years |  |  | Total |
Commercial |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Owner occupied RE |  | $ | 21,235 |  |  |  | 220,648 |  |  |  | 369,748 |  |  |  | 39,966 |  |  |  | 651,597 |
Non-owner occupied RE |  |  | 129,269 |  |  |  | 547,864 |  |  |  | 227,987 |  |  |  | 19,247 |  |  |  | 924,367 |
Construction |  |  | 6,479 |  |  |  | 77,636 |  |  |  | 19,089 |  |  |  | - |  |  |  | 103,204 |
Business |  |  | 129,978 |  |  |  | 277,830 |  |  |  | 144,056 |  |  |  | 4,253 |  |  |  | 556,117 |
Total commercial loans |  |  | 286,961 |  |  |  | 1,123,978 |  |  |  | 760,880 |  |  |  | 63,466 |  |  |  | 2,235,285 |
Consumer |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Real estate |  |  | 20,982 |  |  |  | 82,896 |  |  |  | 281,091 |  |  |  | 743,660 |  |  |  | 1,128,629 |
Home equity |  |  | 3,454 |  |  |  | 36,722 |  |  |  | 160,380 |  |  |  | 4,341 |  |  |  | 204,897 |
Construction |  |  | 5,849 |  |  |  | 2,133 |  |  |  | 10,427 |  |  |  | 2,465 |  |  |  | 20,874 |
Other |  |  | 7,660 |  |  |  | 30,633 |  |  |  | 3,040 |  |  |  | 749 |  |  |  | 42,082 |
Total consumer loans |  |  | 37,945 |  |  |  | 152,384 |  |  |  | 454,938 |  |  |  | 751,215 |  |  |  | 1,396,482 |
Total gross loans, net of deferred fees |  | $ | 324,906 |  |  |  | 1,276,362 |  |  |  | 1,215,818 |  |  |  | 814,681 |  |  |  | 3,631,767 |
The following table summarizes the loans due after one year by category.
Schedule of loans due after one year by category |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | March 31, 2025 |  |  | December 31, 2024 |
|  | Interest Rate |  |  | Interest Rate |
(dollars in thousands) |  |  | Fixed |  |  |  | Floating or Adjustable |  |  |  | Fixed |  |  |  | Floating or Adjustable |
Commercial |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Owner occupied RE |  | $ | 612,057 |  |  |  | 39,863 |  |  | $ | 599,179 |  |  |  | 31,183 |
Non-owner occupied RE |  |  | 722,785 |  |  |  | 95,784 |  |  |  | 701,297 |  |  |  | 93,801 |
Construction |  |  | 36,332 |  |  |  | 32,415 |  |  |  | 63,019 |  |  |  | 33,706 |
Business |  |  | 282,403 |  |  |  | 152,893 |  |  |  | 281,316 |  |  |  | 144,823 |
Total commercial loans |  |  | 1,653,577 |  |  |  | 320,955 |  |  |  | 1,644,811 |  |  |  | 303,513 |
Consumer |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Real estate |  |  | 1,122,201 |  |  |  | - |  |  |  | 1,107,647 |  |  |  | - |
Home equity |  |  | 9,717 |  |  |  | 209,871 |  |  |  | 9,899 |  |  |  | 191,544 |
Construction |  |  | 13,227 |  |  |  | - |  |  |  | 15,025 |  |  |  | - |
Other |  |  | 7,136 |  |  |  | 25,689 |  |  |  | 8,038 |  |  |  | 26,384 |
Total consumer loans |  |  | 1,152,281 |  |  |  | 235,560 |  |  |  | 1,140,609 |  |  |  | 217,928 |
Total gross loans, net of deferred fees |  | $ | 2,805,858 |  |  |  | 556,515 |  |  | $ | 2,785,420 |  |  |  | 521,441 |
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 March 31, 2025.
Schedule of classified by credit quality indicators by year of origination |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | March 31, 2025 |
(dollars in thousands) |  | 2025 |  |  | 2024 |  |  | 2023 |  |  | 2022 |  |  | 2021 |  |  | Prior |  |  | Revolving |  |  | Revolving Converted to Term |  |  | Total |
Commercial |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Owner occupied RE |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  | $ | 15,297 |  |  |  | 63,117 |  |  |  | 46,489 |  |  |  | 195,920 |  |  |  | 119,944 |  |  |  | 208,162 |  |  |  | 85 |  |  |  | - |  |  |  | 649,014 |
Watch |  |  | 1,732 |  |  |  | 460 |  |  |  | 1,172 |  |  |  | 4,360 |  |  |  | 2,339 |  |  |  | 11,111 |  |  |  | - |  |  |  | - |  |  |  | 21,174 |
Special Mention |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 157 |  |  |  | - |  |  |  | 3,520 |  |  |  | - |  |  |  | - |  |  |  | 3,677 |
Total Owner occupied RE |  |  | 17,029 |  |  |  | 63,577 |  |  |  | 47,661 |  |  |  | 200,437 |  |  |  | 122,283 |  |  |  | 222,793 |  |  |  | 85 |  |  |  | - |  |  |  | 673,865 |
Non-owner occupied RE |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  |  | 20,184 |  |  |  | 54,479 |  |  |  | 69,881 |  |  |  | 320,644 |  |  |  | 134,812 |  |  |  | 272,504 |  |  |  | 809 |  |  |  | 466 |  |  |  | 873,779 |
Watch |  |  | - |  |  |  | - |  |  |  | 1,758 |  |  |  | 4,993 |  |  |  | 17,758 |  |  |  | 11,853 |  |  |  | - |  |  |  | - |  |  |  | 36,362 |
Special Mention |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 193 |  |  |  | 7,997 |  |  |  | - |  |  |  | - |  |  |  | 8,190 |
Substandard |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 965 |  |  |  | - |  |  |  | 6,950 |  |  |  | - |  |  |  | - |  |  |  | 7,915 |
Total Non-owner occupied RE |  |  | 20,184 |  |  |  | 54,479 |  |  |  | 71,639 |  |  |  | 326,602 |  |  |  | 152,763 |  |  |  | 299,304 |  |  |  | 809 |  |  |  | 466 |  |  |  | 926,246 |
Construction |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  |  | 1,191 |  |  |  | 20,480 |  |  |  | 27,143 |  |  |  | 22,793 |  |  |  | 14,752 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 86,359 |
Watch |  |  | - |  |  |  | - |  |  |  | 2,494 |  |  |  | 1,168 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 3,662 |
Total Construction |  |  | 1,191 |  |  |  | 20,480 |  |  |  | 29,637 |  |  |  | 23,961 |  |  |  | 14,752 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 90,021 |
Business |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  |  | 40,505 |  |  |  | 51,181 |  |  |  | 39,641 |  |  |  | 114,887 |  |  |  | 33,672 |  |  |  | 62,251 |  |  |  | 193,743 |  |  |  | - |  |  |  | 535,880 |
Watch |  |  | 365 |  |  |  | 837 |  |  |  | 125 |  |  |  | 3,913 |  |  |  | 2,393 |  |  |  | 6,188 |  |  |  | 6,164 |  |  |  | 246 |  |  |  | 20,231 |
Special Mention |  |  | - |  |  |  | 658 |  |  |  | - |  |  |  | 794 |  |  |  | - |  |  |  | 711 |  |  |  | 105 |  |  |  | - |  |  |  | 2,268 |
Substandard |  |  | 195 |  |  |  | 28 |  |  |  | - |  |  |  | 1,291 |  |  |  | - |  |  |  | 989 |  |  |  | 455 |  |  |  | - |  |  |  | 2,958 |
Total Business |  |  | 41,065 |  |  |  | 52,704 |  |  |  | 39,766 |  |  |  | 120,885 |  |  |  | 36,065 |  |  |  | 70,139 |  |  |  | 200,467 |  |  |  | 246 |  |  |  | 561,337 |
Current period gross write-offs |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (78 | ) |  |  | - |  |  |  | - |  |  |  | (78 | )
Total Commercial loans |  |  | 79,469 |  |  |  | 191,240 |  |  |  | 188,703 |  |  |  | 671,885 |  |  |  | 325,863 |  |  |  | 592,236 |  |  |  | 201,361 |  |  |  | 712 |  |  |  | 2,251,469 |
Consumer |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Real estate |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  |  | 39,113 |  |  |  | 75,296 |  |  |  | 140,300 |  |  |  | 273,351 |  |  |  | 259,362 |  |  |  | 307,507 |  |  |  | - |  |  |  | - |  |  |  | 1,094,929 |
Watch |  |  | 100 |  |  |  | 902 |  |  |  | 4,477 |  |  |  | 6,826 |  |  |  | 8,612 |  |  |  | 8,590 |  |  |  | - |  |  |  | - |  |  |  | 29,507 |
Special Mention |  |  | 153 |  |  |  | 596 |  |  |  | 1,528 |  |  |  | 4,841 |  |  |  | 2,648 |  |  |  | 7,834 |  |  |  | - |  |  |  | - |  |  |  | 17,600 |
Substandard |  |  | - |  |  |  | 426 |  |  |  | 436 |  |  |  | 1,340 |  |  |  | 739 |  |  |  | 2,380 |  |  |  | - |  |  |  | - |  |  |  | 5,321 |
Total Real estate |  |  | 39,366 |  |  |  | 77,220 |  |  |  | 146,741 |  |  |  | 286,358 |  |  |  | 271,361 |  |  |  | 326,311 |  |  |  | - |  |  |  | - |  |  |  | 1,147,357 |
Home equity |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 206,653 |  |  |  | - |  |  |  | 206,653 |
Watch |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 9,081 |  |  |  | - |  |  |  | 9,081 |
Special Mention |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 6,188 |  |  |  | - |  |  |  | 6,188 |
Substandard |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 1,139 |  |  |  | - |  |  |  | 1,139 |
Total Home equity |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 223,061 |  |  |  | - |  |  |  | 223,061 |
Construction |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  |  | 2,658 |  |  |  | 10,142 |  |  |  | 1,833 |  |  |  | 8,907 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 23,540 |
Total Construction |  |  | 2,658 |  |  |  | 10,142 |  |  |  | 1,833 |  |  |  | 8,907 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 23,540 |
Other |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  |  | 470 |  |  |  | 1,045 |  |  |  | 799 |  |  |  | 1,432 |  |  |  | 683 |  |  |  | 3,122 |  |  |  | 29,199 |  |  |  | - |  |  |  | 36,750 |
Watch |  |  | - |  |  |  | 176 |  |  |  | 46 |  |  |  | - |  |  |  | 359 |  |  |  | 124 |  |  |  | 480 |  |  |  | - |  |  |  | 1,185 |
Special Mention |  |  | - |  |  |  | 34 |  |  |  | 34 |  |  |  | 322 |  |  |  | 61 |  |  |  | 62 |  |  |  | 43 |  |  |  | - |  |  |  | 556 |
Substandard |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 1 |  |  |  | - |  |  |  | 1 |
Total Other |  |  | 470 |  |  |  | 1,255 |  |  |  | 879 |  |  |  | 1,754 |  |  |  | 1,103 |  |  |  | 3,308 |  |  |  | 29,723 |  |  |  | - |  |  |  | 38,492 |
Total Consumer loans |  |  | 42,494 |  |  |  | 88,617 |  |  |  | 149,453 |  |  |  | 297,019 |  |  |  | 272,464 |  |  |  | 329,619 |  |  |  | 252,784 |  |  |  | - |  |  |  | 1,432,450 |
Total loans |  | $ | 121,963 |  |  |  | 279,857 |  |  |  | 338,156 |  |  |  | 968,904 |  |  |  | 598,327 |  |  |  | 921,855 |  |  |  | 454,145 |  |  |  | 712 |  |  |  | 3,683,919 |
Total Current period gross write-offs |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (78 | ) |  |  | - |  |  |  | - |  |  |  | (78 | )
The following table presents loan balances classified by credit quality indicators by year of origination as of December 31, 2024.
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | December 31, 2024 |
(dollars in thousands) |  | 2024 |  |  | 2023 |  |  | 2022 |  |  | 2021 |  |  | 2020 |  |  | Prior |  |  | Revolving |  |  | Revolving Converted to Term |  |  | Total |
Commercial |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Owner occupied RE |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  | $ | 51,338 |  |  |  | 47,997 |  |  |  | 186,361 |  |  |  | 122,306 |  |  |  | 66,561 |  |  |  | 145,743 |  |  |  | 160 |  |  |  | 238 |  |  |  | 620,704 |
Watch |  |  | 480 |  |  |  | 1,180 |  |  |  | 3,638 |  |  |  | 1,962 |  |  |  | 8,828 |  |  |  | 11,012 |  |  |  | - |  |  |  | - |  |  |  | 27,100 |
Special Mention |  |  | - |  |  |  | - |  |  |  | 162 |  |  |  | - |  |  |  | - |  |  |  | 2,840 |  |  |  | - |  |  |  | - |  |  |  | 3,002 |
Substandard |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 791 |  |  |  | - |  |  |  | - |  |  |  | 791 |
Total Owner occupied RE |  |  | 51,818 |  |  |  | 49,177 |  |  |  | 190,161 |  |  |  | 124,268 |  |  |  | 75,389 |  |  |  | 160,386 |  |  |  | 160 |  |  |  | 238 |  |  |  | 651,597 |
Non-owner occupied RE |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  |  | 50,685 |  |  |  | 70,517 |  |  |  | 321,726 |  |  |  | 145,658 |  |  |  | 95,994 |  |  |  | 183,723 |  |  |  | 360 |  |  |  | 220 |  |  |  | 868,883 |
Watch |  |  | - |  |  |  | 954 |  |  |  | 6,081 |  |  |  | 10,238 |  |  |  | 4,705 |  |  |  | 8,435 |  |  |  | - |  |  |  | - |  |  |  | 30,413 |
Special Mention |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 7,579 |  |  |  | - |  |  |  | 8,882 |  |  |  | - |  |  |  | - |  |  |  | 16,461 |
Substandard |  |  | - |  |  |  | - |  |  |  | 969 |  |  |  | - |  |  |  | - |  |  |  | 7,641 |  |  |  | - |  |  |  | - |  |  |  | 8,610 |
Total Non-owner occupied RE |  |  | 50,685 |  |  |  | 71,471 |  |  |  | 328,776 |  |  |  | 163,475 |  |  |  | 100,699 |  |  |  | 208,681 |  |  |  | 360 |  |  |  | 220 |  |  |  | 924,367 |
Current period gross write-offs |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (1,029 | ) |  |  | - |  |  |  | - |  |  |  | (1,029 | )
Construction |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  |  | 24,076 |  |  |  | 26,501 |  |  |  | 34,067 |  |  |  | 15,000 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 99,644 |
Watch |  |  | - |  |  |  | 2,420 |  |  |  | 1,140 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 3,560 |
Total Construction |  |  | 24,076 |  |  |  | 28,921 |  |  |  | 35,207 |  |  |  | 15,000 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 103,204 |
Business |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  |  | 54,814 |  |  |  | 41,743 |  |  |  | 129,450 |  |  |  | 38,312 |  |  |  | 15,716 |  |  |  | 51,566 |  |  |  | 196,246 |  |  |  | 803 |  |  |  | 528,650 |
Watch |  |  | - |  |  |  | 132 |  |  |  | 5,353 |  |  |  | 2,174 |  |  |  | 1,423 |  |  |  | 5,243 |  |  |  | 8,776 |  |  |  | 389 |  |  |  | 23,490 |
Special Mention |  |  | 660 |  |  |  | 95 |  |  |  | 805 |  |  |  | - |  |  |  | 65 |  |  |  | 533 |  |  |  | - |  |  |  | 206 |  |  |  | 2,364 |
Substandard |  |  | 28 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 385 |  |  |  | 630 |  |  |  | 570 |  |  |  | - |  |  |  | 1,613 |
Total Business |  |  | 55,502 |  |  |  | 41,970 |  |  |  | 135,608 |  |  |  | 40,486 |  |  |  | 17,589 |  |  |  | 57,972 |  |  |  | 205,592 |  |  |  | 1,398 |  |  |  | 556,117 |
Current period gross write-offs |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (143 | ) |  |  | (347 | ) |  |  | (18 | ) |  |  | (72 | ) |  |  | - |  |  |  | (580 | )
Total Commercial loans |  |  | 182,081 |  |  |  | 191,539 |  |  |  | 689,752 |  |  |  | 343,229 |  |  |  | 193,677 |  |  |  | 427,039 |  |  |  | 206,112 |  |  |  | 1,856 |  |  |  | 2,235,285 |
Consumer |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Real estate |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  |  | 78,287 |  |  |  | 144,487 |  |  |  | 277,854 |  |  |  | 263,079 |  |  |  | 160,007 |  |  |  | 153,584 |  |  |  | - |  |  |  | - |  |  |  | 1,077,298 |
Watch |  |  | 671 |  |  |  | 2,409 |  |  |  | 6,961 |  |  |  | 8,573 |  |  |  | 4,147 |  |  |  | 4,632 |  |  |  | - |  |  |  | - |  |  |  | 27,393 |
Special Mention |  |  | 817 |  |  |  | 1,536 |  |  |  | 5,987 |  |  |  | 2,664 |  |  |  | 2,804 |  |  |  | 5,181 |  |  |  | - |  |  |  | - |  |  |  | 18,989 |
Substandard |  |  | 212 |  |  |  | 508 |  |  |  | 967 |  |  |  | 746 |  |  |  | 821 |  |  |  | 1,695 |  |  |  | - |  |  |  | - |  |  |  | 4,949 |
Total Real estate |  |  | 79,987 |  |  |  | 148,940 |  |  |  | 291,769 |  |  |  | 275,062 |  |  |  | 167,779 |  |  |  | 165,092 |  |  |  | - |  |  |  | - |  |  |  | 1,128,629 |
Home equity |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 188,451 |  |  |  | - |  |  |  | 188,451 |
Watch |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 9,114 |  |  |  | - |  |  |  | 9,114 |
Special Mention |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 6,173 |  |  |  | - |  |  |  | 6,173 |
Substandard |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 1,159 |  |  |  | - |  |  |  | 1,159 |
Total Home equity |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 204,897 |  |  |  | - |  |  |  | 204,897 |
Current period gross write-offs |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (45 | ) |  |  | - |  |  |  | (45 | )
Construction |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  |  | 7,700 |  |  |  | 3,636 |  |  |  | 9,222 |  |  |  | 316 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 20,874 |
Total Construction |  |  | 7,700 |  |  |  | 3,636 |  |  |  | 9,222 |  |  |  | 316 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 20,874 |
Other |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  |  | 2,732 |  |  |  | 836 |  |  |  | 1,521 |  |  |  | 1,593 |  |  |  | 1,229 |  |  |  | 2,609 |  |  |  | 29,660 |  |  |  | - |  |  |  | 40,180 |
Watch |  |  | 167 |  |  |  | 61 |  |  |  | 12 |  |  |  | 366 |  |  |  | - |  |  |  | 129 |  |  |  | 595 |  |  |  | - |  |  |  | 1,330 |
Special Mention |  |  | 36 |  |  |  | 35 |  |  |  | 325 |  |  |  | 66 |  |  |  | - |  |  |  | 65 |  |  |  | 45 |  |  |  | - |  |  |  | 572 |
Total Other |  |  | 2,935 |  |  |  | 932 |  |  |  | 1,858 |  |  |  | 2,025 |  |  |  | 1,229 |  |  |  | 2,803 |  |  |  | 30,300 |  |  |  | - |  |  |  | 42,082 |
Current period gross write-offs |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (38 | ) |  |  | (42 | ) |  |  | - |  |  |  | (80 | )
Total Consumer loans |  |  | 90,622 |  |  |  | 153,508 |  |  |  | 302,849 |  |  |  | 277,403 |  |  |  | 169,008 |  |  |  | 167,895 |  |  |  | 235,197 |  |  |  | - |  |  |  | 1,396,482 |
Total loans |  | $ | 272,703 |  |  |  | 345,047 |  |  |  | 992,601 |  |  |  | 620,632 |  |  |  | 362,685 |  |  |  | 594,934 |  |  |  | 441,309 |  |  |  | 1,856 |  |  |  | 3,631,767 |
Total Current period gross write-offs |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (143 | ) |  |  | (347 | ) |  |  | (1,085 | ) |  |  | (159 | ) |  |  | - |  |  |  | (1,734 | )
The following tables present loan balances by age and payment status.
Schedule of loan balances by age payment status |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | March 31, 2025 |
(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 |  | $ | 1,074 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 672,791 |  |  |  | 673,865 |
Non-owner occupied RE |  |  | 1,766 |  |  |  | - |  |  |  | - |  |  |  | 6,950 |  |  |  | 917,530 |  |  |  | 926,246 |
Construction |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 90,021 |  |  |  | 90,021 |
Business |  |  | 912 |  |  |  | - |  |  |  | - |  |  |  | 1,087 |  |  |  | 559,338 |  |  |  | 561,337 |
Consumer |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Real estate |  |  | 5,514 |  |  |  | - |  |  |  | - |  |  |  | 2,414 |  |  |  | 1,139,429 |  |  |  | 1,147,357 |
Home equity |  |  | 747 |  |  |  | - |  |  |  | - |  |  |  | 310 |  |  |  | 222,004 |  |  |  | 223,061 |
Construction |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 23,540 |  |  |  | 23,540 |
Other |  |  | 37 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 38,455 |  |  |  | 38,492 |
Total loans |  | $ | 10,050 |  |  |  | - |  |  |  | - |  |  |  | 10,761 |  |  |  | 3,663,108 |  |  |  | 3,683,919 |
|  |  | December 31, 2024 |
(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 |  | $ | 292 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 651,305 |  |  |  | 651,597 |
Non-owner occupied RE |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 7,641 |  |  |  | 916,726 |  |  |  | 924,367 |
Construction |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 103,204 |  |  |  | 103,204 |
Business |  |  | 1,319 |  |  |  | - |  |  |  | - |  |  |  | 1,016 |  |  |  | 553,782 |  |  |  | 556,117 |
Consumer |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Real estate |  |  | 3,839 |  |  |  | 938 |  |  |  | - |  |  |  | 1,908 |  |  |  | 1,121,944 |  |  |  | 1,128,629 |
Home equity |  |  | 41 |  |  |  | - |  |  |  | - |  |  |  | 312 |  |  |  | 204,544 |  |  |  | 204,897 |
Construction |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 20,874 |  |  |  | 20,874 |
Other |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 42,082 |  |  |  | 42,082 |
Total loans |  | $ | 5,491 |  |  |  | 938 |  |  |  | - |  |  |  | 10,877 |  |  |  | 3,614,461 |  |  |  | 3,631,767 |
As of March 31, 2025 and December 31, 2024, accruing loans 30 days or more past due represented 0.27% and 0.18% of the Company’s total loan portfolio, respectively. Commercial loans 30 days or more past due were 0.10% and 0.05% of the Company’s total loan portfolio as of March 31, 2025 and December 31, 2024, respectively. Consumer loans 30 days or more past due were 0.17% and 0.13% of total loans as of March 31, 2025 and December 31, 2024, respectively. The table below summarizes nonaccrual loans by major categories for the periods presented.
Schedule of nonaccrual loans by major categories |  |  |  |  |  |  |  |  |
|  | March 31, 2025 |  |  | December 31, 2024 |
|  | Nonaccrual |  |  | Nonaccrual |  |  |  |  |  | Nonaccrual |  |  | Nonaccrual |  |  |  |
|  | loans |  |  | loans |  |  | Total |  |  | loans |  |  | loans |  |  | Total |
|  | with no |  |  | with an |  |  | nonaccrual |  |  | with no |  |  | with an |  |  | nonaccrual |
(dollars in thousands) |  | allowance |  |  | allowance |  |  | loans |  |  | allowance |  |  | allowance |  |  | loans |
Commercial |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Non-owner occupied RE |  | $ | 5,167 |  |  |  | 1,783 |  |  |  | 6,950 |  |  | $ | 5,844 |  |  |  | 1,797 |  |  |  | 7,641 |
Business |  |  | - |  |  |  | 1,087 |  |  |  | 1,087 |  |  |  | - |  |  |  | 1,016 |  |  |  | 1,016 |
Total commercial |  |  | 5,167 |  |  |  | 2,870 |  |  |  | 8,037 |  |  |  | 5,844 |  |  |  | 2,813 |  |  |  | 8,657 |
Consumer |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Real estate |  |  | 1,670 |  |  |  | 744 |  |  |  | 2,414 |  |  |  | 1,526 |  |  |  | 382 |  |  |  | 1,908 |
Home equity |  |  | 310 |  |  |  | - |  |  |  | 310 |  |  |  | 312 |  |  |  | - |  |  |  | 312 |
Total consumer |  |  | 1,980 |  |  |  | 744 |  |  |  | 2,724 |  |  |  | 1,838 |  |  |  | 382 |  |  |  | 2,220 |
Total nonaccrual loans |  | $ | 7,147 |  |  |  | 3,614 |  |  |  | 10,761 |  |  | $ | 7,682 |  |  |  | 3,195 |  |  |  | 10,877 |
The Company did not recognize interest income on nonaccrual loans for the three months ended March 31, 2025 and March 31, 2024. The accrued interest reversed during the three months ended March 31, 2025 and March 31, 2024 was not material. Foregone interest income on the nonaccrual loans for the three month period ended March 31, 2025 was $74,000. Foregone interest income on the nonaccrual loans for the three month period ended March 31, 2024 was not material.0 The table below summarizes information regarding nonperforming assets.
Schedule of nonperforming assets |  |  |  |  |  |
(dollars in thousands) |  | March 31, 2025 |  |  | December 31, 2024 |
Nonaccrual loans |  | $ | 10,761 |  |  |  | 10,877 |
Other real estate owned |  |  | 275 |  |  |  | - |
Total nonperforming assets |  | $ | 11,036 |  |  |  | 10,877 |
Nonperforming assets as a percentage of: |  |  |  |  |  |  |  |
Total assets |  |  | 0.26 | % |  |  | 0.27 | %
Gross loans |  |  | 0.30 | % |  |  | 0.30 | %
Total loans over 90 days past due |  | $ | 1,668 |  |  |  | 2,641 |
Loans over 90 days past due and still accruing |  |  | - |  |  |  | - |
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 discounted cash flow 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 due to the measurement methodologies used to estimate the allowance, a change to the allowance for credit losses is generally not recorded upon modification. Loan modifications to borrowers experiencing financial difficulty were not material for the three months ended March 31, 2025 and March 31, 2024. Allowance for Credit Losses The Company maintains an allowance for credit losses to provide for expected credit losses. Losses are charged against the allowance when management believes that the principal is uncollectable. Subsequent recoveries, if any, are credited to the allowance. Allocations of the allowance are made for specific loans and for pools of similar types of loans, although the entire allowance is available for any loan that, in management’s judgment, should be charged against the allowance. A provision for credit losses is taken based on management’s ongoing evaluation of the appropriate allowance balance. A formal evaluation of the adequacy of the ACL is conducted quarterly. This assessment includes procedures to estimate the allowance and test the adequacy and appropriateness of the resulting balance. The level of the allowance is based upon management’s evaluation of historical default and loss experience, current and projected economic conditions, asset quality trends, known and inherent risks in the portfolio, adverse situations that may affect the borrowers’ ability to repay a loan, the estimated value of any underlying collateral, composition of the loan portfolio, industry and peer bank loan quality indications and other pertinent factors, including regulatory recommendations. Management believes the level of the ACL is adequate to absorb all expected future losses inherent in the loan portfolio at the balance sheet date. The allowance is increased through provision for credit losses and decreased by charge-offs, net of recoveries of amounts previously charged-off. On January 1, 2025, the Company transitioned to the DCF modeling approach to estimate the ACL on loans as it allows for a better estimation of credit losses through customization among the various inputs by loan segmentation. The DCF methodology is applied on a segment-by-segment basis at the loan level with a one-year reasonable and supportable forecast period, followed by a one-year reversion to the long-term average. The Company considers economic forecasts of national gross domestic product (“GDP”) and unemployment rates as reported by Fannie Mae to inform the model for loss estimation. Historical loss rates used in the quantitative model were derived using both the Bank’s and peer bank data obtained from publicly-available sources (i.e., federal call reports) encompassing an economic cycle. The peer group utilized by the Bank is comprised of financial institutions of relatively similar size (i.e., $1 - $15 billion of total assets) and in similar markets. In addition, the DCF methodology considers the weighted average life of the portfolio, impacting the reaction time and the exposure to potential loss based on changes in the interest rate environment. Management also considers qualitative adjustments when estimating loan losses to take into account the model’s quantitative limitations. Qualitative adjustments to quantitative loss factors, either negative or positive, may include changes in lending policies; international, national, regional, and local conditions; volume and terms of loans; experience and depth of management; volume and severity of past due loans; effects of changes in lending policy; concentrations of credit; and loan review results. The Company enhanced its qualitative factor framework to better address risks that are not reflected in the quantitative loss factors. Prior to January 1, 2025, the Company used a lifetime probability of default and loss given default modeling approach to estimate the allowance for credit losses on loans. This method used historical correlations between default experience and the age of loans to forecast defaults and losses, assuming that a loan in a pool shares similar risk characteristics such as loan product type, risk rating and loan age, and demonstrates similar default characteristics as other loans in that pool, as the loan progresses through its lifecycle. The Company calculated lifetime probability of default and loss given default rates based on historical loss experience, which is used to calculate expected losses based on the pool’s loss rate and the age of loans in the pool. The Company used its own internal data to measure historical credit loss experience within the pools with similar risk characteristics over an economic cycle. The probability of default and loss given default method also includes assumptions of observed migration over the lifetime of the underlying loan data. Loans that do not share risk characteristics were evaluated for expected credit losses on an individual basis and excluded from the collective evaluation. The following tables summarize the activity related to the allowance for credit losses for the three months ended March 31, 2025 and March 31, 2024 under the CECL methodology.
Schedule of activity related to the allowance for credit losses |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  | Three months ended March 31, 2025 |
|  | 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 |  | $ | 5,482 |  |  |  | 10,219 |  |  |  | 940 |  |  |  | 7,745 |  |  |  | 12,359 |  |  |  | 2,655 |  |  |  | 115 |  |  |  | 399 |  |  |  | 39,914 |
Provision for credit losses for loans |  |  | (1,548 | ) |  |  | (2,886 | ) |  |  | (358 | ) |  |  | 3,402 |  |  |  | 2,834 |  |  |  | (1,110 | ) |  |  | 372 |  |  |  | 44 |  |  |  | 750 |
Loan charge-offs |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (78 | ) |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (78 | )
Loan recoveries |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 62 |  |  |  | - |  |  |  | 4 |  |  |  | - |  |  |  | 35 |  |  |  | 101 |
Net loan recoveries (charge-offs) |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (16 | ) |  |  | - |  |  |  | 4 |  |  |  | - |  |  |  | 35 |  |  |  | 23 |
Balance, end of period |  | $ | 3,934 |  |  |  | 7,333 |  |  |  | 582 |  |  |  | 11,131 |  |  |  | 15,193 |  |  |  | 1,549 |  |  |  | 487 |  |  |  | 478 |  |  |  | 40,687 |
Net recoveries to average loans (annualized) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 0.00 | %
Allowance for credit losses to gross loans |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 1.10 | %
Allowance for credit losses to nonperforming loans |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 378.09 | %
|  | Three months ended March 31, 2024 |
|  | 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 |  | $ | 6,118 |  |  |  | 11,167 |  |  |  | 1,594 |  |  |  | 7,385 |  |  |  | 10,647 |  |  |  | 2,600 |  |  |  | 677 |  |  |  | 494 |  |  |  | 40,682 |
Provision for credit losses for loans |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
Loan charge-offs |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (346 | ) |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (78 | ) |  |  | (424 | )
Loan recoveries |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 15 |  |  |  | - |  |  |  | 119 |  |  |  | - |  |  |  | 49 |  |  |  | 183 |
Net loan recoveries (charge-offs) |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (331 | ) |  |  | - |  |  |  | 119 |  |  |  | - |  |  |  | (29 | ) |  |  | (241 | )
Balance, end of period |  | $ | 6,118 |  |  |  | 11,167 |  |  |  | 1,594 |  |  |  | 7,054 |  |  |  | 10,647 |  |  |  | 2,719 |  |  |  | 677 |  |  |  | 465 |  |  |  | 40,441 |
Net recoveries to average loans (annualized) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 0.03 | %
Allowance for credit losses to gross loans |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 1.11 | %
Allowance for credit losses to nonperforming loans |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 1,109.13 | %
There was a provision for credit losses of $750,000 for the three months ended March 31, 2025. There was no provision for credit losses recorded during the first quarter of 2024. 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 tables present an analysis of collateral-dependent loans of the Company as of March 31, 2025 and December 31, 2024.
Schedule of analysis of collateral-dependent loans |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  | March 31, 2025 |
|  | Real |  |  | Business |  |  |  |  |  |  |
(dollars in thousands) |  | estate |  |  | assets |  |  | Other |  |  | Total |
Commercial |  |  |  |  |  |  |  |  |  |  |  |
Non-owner occupied RE |  | $ | 6,950 |  |  |  | - |  |  |  | - |  |  |  | 6,950 |
Business |  |  | 545 |  |  |  | 542 |  |  |  | - |  |  |  | 1,087 |
Total commercial |  |  | 7,495 |  |  |  | 542 |  |  |  | - |  |  |  | 8,037 |
Consumer |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Real estate |  |  | 2,414 |  |  |  | - |  |  |  | - |  |  |  | 2,414 |
Home equity |  |  | 310 |  |  |  | - |  |  |  | - |  |  |  | 310 |
Total consumer |  |  | 2,724 |  |  |  | - |  |  |  | - |  |  |  | 2,724 |
Total |  | $ | 10,219 |  |  |  | 542 |  |  |  | - |  |  |  | 10,761 |
|  |  |  |  |  |  |  |  |  |  | December 31, 2024 |
|  |  | Real |  |  |  | Business |  |  |  |  |  |  |  |  |
(dollars in thousands) |  |  | estate |  |  |  | assets |  |  |  | Other |  |  |  | Total |
Commercial |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Non-owner occupied RE |  | $ | 7,641 |  |  |  | - |  |  |  | - |  |  |  | 7,641 |
Business |  |  | 460 |  |  |  | 556 |  |  |  | - |  |  |  | 1,016 |
Total commercial |  |  | 8,101 |  |  |  | 556 |  |  |  | - |  |  |  | 8,657 |
Consumer |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Real estate |  |  | 1,908 |  |  |  | - |  |  |  | - |  |  |  | 1,908 |
Home equity |  |  | 312 |  |  |  | - |  |  |  | - |  |  |  | 312 |
Total consumer |  |  | 2,220 |  |  |  | - |  |  |  | - |  |  |  | 2,220 |
Total |  | $ | 10,321 |  |  |  | 556 |  |  |  | - |  |  |  | 10,877 |
Allowance for Credit Losses - Unfunded Loan Commitments The allowance for credit losses for unfunded loan commitments was $1.5 million at March 31, 2025 and December 31, 2024, and is separately classified on the balance sheet within other liabilities. The following table presents the balance and activity in the ACL for unfunded loan commitments for the three months ended March 31, 2025 and for the twelve months ended December 31, 2024.
Schedule of allowance for credit losses for unfunded loan commitments |  |  |  |  |  |
|  | Three months ended |  |  | Twelve months ended |
(dollars in thousands) |  | March 31, 2025 |  |  | December 31, 2024 |
Balance, beginning of period |  | $ | 1,456 |  |  |  | 1,831 |
Provision for (reversal of) credit losses |  |  | - |  |  |  | (375 | )
Balance, end of period |  | $ | 1,456 |  |  |  | 1,456 |
Unfunded Loan Commitments |  | $ | 716,114 |  |  |  | 719,084 |
Reserve for Unfunded Commitments to Unfunded Loan Commitments |  |  | 0.20 | % |  |  | 0.20 | %

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- Definition The entire disclosure for claims held for amounts due to entity, excluding financing receivables. Examples include, but are not limited to, trade accounts receivables, notes receivables, loans receivables. Includes disclosure for allowance for credit losses. + References Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef -Topic 310 -SubTopic 10 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/310-10/tableOfContent Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 835 -SubTopic 30 -Name Accounting Standards Codification -Section 45 -Paragraph 2 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482925/835-30-45-2 + Details
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