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Loans (Tables)

3 Months Ended

Mar. 31, 2023

Loan balances as of March 31, 2023 and December 31, 2022 are summarized below:


	(In Thousands)
Loans:	March 31, 2023			December 31, 2022
Consumer Real Estate	$	502,974		$	494,423
Agricultural Real Estate		227,897			220,819
Agricultural		131,467			128,733
Commercial Real Estate		1,225,315			1,152,603
Commercial and Industrial		241,598			242,360
Consumer		89,588			89,147
Other		29,316			29,818
		2,448,155			2,357,903
Less: Net deferred loan fees and costs		(1,503	)		(1,516	)
		2,446,652			2,356,387
Less: Allowance for credit losses		(24,634	)		(20,313	)
Loans - Net	$	2,422,018		$	2,336,074

Distribution of Fixed Rate Loans and Variable Rate Loans by Major Loan Category

The distribution of fixed rate loans and variable rate loans by major loan category is as follows as of March 31, 2023 and December 31, 2022:


	(In Thousands)
	March 31, 2023				December 31, 2022
	Fixed		Variable		Fixed		Variable
Consumer Real Estate	$	350,541	$	152,433	$	354,420	$	140,003
Agricultural Real Estate		144,890		83,007		144,702		76,117
Agricultural		52,394		79,073		52,867		75,866
Commercial Real Estate		970,161		255,154		941,927		210,676
Commercial and Industrial		136,702		104,896		130,513		111,847
Consumer		89,520		68		88,972		175
Other		19,620		9,696		20,029		9,789

Contractual Aging of Recorded Investment in Past Due Loans by Portfolio Classification of Loans

The following table represents the contractual aging of the recorded investment (in thousands) in past due loans by portfolio classification of loans as of March 31, 2023 and December 31, 2022, net of deferred loan fees and costs:


March 31, 2023	30-59 Days Past Due		60-89 Days Past Due		Greater Than 90 Days		Total Past Due		Current		Total Financing Receivables		Recorded Investment > 90 Days and Accruing

Consumer Real Estate	$	850	$	-	$	111	$	961	$	502,007	$	502,968	$	-
Agricultural Real Estate		231		283		1,511		2,025		225,574		227,599		-
Agricultural		-		-		-		-		131,677		131,677		-
Commercial Real Estate		8,383		-		267		8,650		1,214,513		1,223,163		-
Commercial and Industrial		-		346		854		1,200		269,657		270,857		-
Consumer		73		25		19		117		90,271		90,388		-
Total	$	9,537	$	654	$	2,762	$	12,953	$	2,433,699	$	2,446,652	$	-


December 31, 2022	30-59 Days Past Due		60-89 Days Past Due		Greater Than 90 Days		Total Past Due		Current		Total Financing Receivables		Recorded Investment > 90 Days and Accruing

Consumer Real Estate	$	1,536	$	635	$	90	$	2,261	$	492,162	$	494,423	$	-
Agricultural Real Estate		118		2		1,550		1,670		218,844		220,514		-
Agricultural		433		-		152		585		128,341		128,926		-
Commercial Real Estate		74		-		180		254		1,150,257		1,150,511		-
Commercial and Industrial		953		-		182		1,135		270,984		272,119		-
Consumer		83		37		-		120		89,774		89,894		-
Total	$	3,197	$	674	$	2,154	$	6,025	$	2,350,362	$	2,356,387	$	-

Amortized Cost of Nonaccrual Loans by Portfolio Class of Loans

The following tables present the amortized cost of nonaccrual loans by class of loans as of March 31, 2023 and the recorded investment of nonaccrual loans by class of loans as of December 31, 2022:


	(In Thousands)
	Nonaccrual				Loans Past
	With No				Due Over
	Allowance				89 Days
	for Credit Loss		Nonaccrual		Still Accruing

Consumer Real Estate	$	912	$	912	$	-
Agricultural Real Estate		5,503		5,503		-
Agricultural		61		61		-
Commercial Real Estate		268		268		-
Commercial & Industrial		111		948		-
Consumer		21		21		-
Total	$	6,876	$	7,713	$	-


	(In Thousands)
	December 31, 2022

Consumer Real Estate	$	612
Agricultural Real Estate		1,921
Agricultural		152
Commercial Real Estate		903
Commercial & Industrial		1,096
Consumer		5
Total	$	4,689

Risk Category of Loans by Portfolio Class

The following table represents the risk category of loans by portfolio class, net of deferred fees and costs, based on the most recent analysis performed as of December 31, 2022:


	(In Thousands)
	Agricultural				Commercial		Commercial
	Real Estate		Agricultural		Real Estate		and Industrial		Other
December 31, 2022
1-2	$	9,912	$	5,857	$	8,718	$	780	$	-
3		47,405		33,671		370,035		67,506		10,921
4		146,143		88,992		737,745		167,291		18,897
5		10,389		228		9,751		3,592		-
6		6,665		178		24,262		3,132		-
7		-		-		-		-		-
8		-		-		-		-		-
Total	$	220,514	$	128,926	$	1,150,511	$	242,301	$	29,818

Recorded Investment for Consumer Loans, Credit Quality based on Status of Loan and Payment Activity

The following tables present the recorded investment in those classes based on payment activity and assigned risk grading as of December 31, 2022.


	(In Thousands)
	Consumer
	Real Estate
	December 31, 2022
Grade
Pass (1-4)	$	492,575
Special Mention (5)		676
Substandard (6)		1,172
Doubtful (7)		-
Total	$	494,423


	(In Thousands)
	Consumer
	December 31, 2022
Performing	$	89,853
Nonperforming		41
Total	$	89,894

Loan Balances Based on Year of Origination

The following table reflects loan balances as of March 31, 2023 based on year of origination:


	(In Thousands)
	Term Loans Amortized Cost Basis by Origination Year
													Revolving
													Loans
											Term		Amortized		Grand
	2023		2022		2021		2020		Prior		Total		Cost Basis		Total
March 31, 2023
Consumer Real Estate
Risk Rating
Pass (1-4)	$	23,642	$	103,775	$	98,956	$	88,874	$	140,856	$	456,103	$	45,103	$	501,206
Special Mention (5)		-		-		-		-		559		559		-		559
Substandard (6)		-		-		407		-		778		1,185		18		1,203
Doubtful (7)		-		-		-		-		-		-		-		-
Total Consumer Real Estate	$	23,642	$	103,775	$	99,363	$	88,874	$	142,193	$	457,847	$	45,121	$	502,968
Gross charge-offs	$	-	$	-	$	-	$	-	$	-	$	-	$	-	$	-

Agricultural Real Estate
Risk Rating
Pass (1-4)	$	12,810	$	40,851	$	38,036	$	27,066	$	91,794	$	210,557	$	97	$	210,654
Special Mention (5)		-		-		686		346		6,947		7,979		-		7,979
Substandard (6)		-		250		1,510		189		7,017		8,966		-		8,966
Doubtful (7)		-		-		-		-		-		-		-		-
Total Agricultural Real Estate	$	12,810	$	41,101	$	40,232	$	27,601	$	105,758	$	227,502	$	97	$	227,599
Gross charge-offs	$	-	$	-	$	-	$	-	$	-	$	-	$	-	$	-

Agricultural
Risk Rating
Pass (1-4)	$	11,106	$	28,922	$	12,985	$	5,433	$	7,226	$	65,672	$	65,920	$	131,592
Special Mention (5)		-		-		-		-		-		-		1		1
Substandard (6)		-		-		-		84		-		84		-		84
Doubtful (7)		-		-		-		-		-		-		-		-
Total Agricultural	$	11,106	$	28,922	$	12,985	$	5,517	$	7,226	$	65,756	$	65,921	$	131,677
Gross charge-offs	$	-	$	-	$	-	$	-	$	-	$	-	$	-	$	-


	(In Thousands)
	Term Loans Amortized Cost Basis by Origination Year
													Revolving
													Loans
											Term		Amortized		Grand
	2023		2022		2021		2020		Prior		Total		Cost Basis		Total
March 31, 2023
Commercial Real Estate
Risk Rating
Pass (1-4)	$	89,943	$	440,142	$	262,208	$	131,449	$	265,358	$	1,189,100	$	-	$	1,189,100
Special Mention (5)		-		-		-		10,697		1,292		11,989		-		11,989
Substandard (6)		98		613		-		75		21,288		22,074		-		22,074
Doubtful (7)		-		-		-		-		-		-		-		-
Total Commercial Real Estate	$	90,041	$	440,755	$	262,208	$	142,221	$	287,938	$	1,223,163	$	-	$	1,223,163
Gross charge-offs	$	-	$	-	$	-	$	-	$	-	$	-	$	-	$	-
Commercial & Industrial
Risk Rating
Pass (1-4)	$	17,561	$	63,073	$	33,720	$	29,328	$	6,634	$	150,316	$	85,496	$	235,812
Special Mention (5)		200		-		221		159		481		1,061		195		1,256
Substandard (6)		-		493		695		944		378		2,510		1,956		4,466
Doubtful (7)		-		-		-		-		-		-		-		-
Total Commercial & Industrial	$	17,761	$	63,566	$	34,636	$	30,431	$	7,493	$	153,887	$	87,647	$	241,534
Gross charge-offs	$	-	$	-	$	-	$	-	$	-	$	-	$	-	$	-

Other
Risk Rating
Pass (1-4)	$	-	$	200	$	17,526	$	6,341	$	5,256	$	29,323	$	-	$	29,323
Special Mention (5)		-		-		-		-		-		-		-		-
Substandard (6)		-		-		-		-		-		-		-		-
Doubtful (7)		-		-		-		-		-		-		-		-
Total Consumer	$	-	$	200	$	17,526	$	6,341	$	5,256	$	29,323	$	-	$	29,323
Gross charge-offs	$	-	$	-	$	-	$	-	$	-	$	-	$	-	$	-

The following table presents payment performance as of March 31, 2023 by year of origination:


	(In Thousands)
	Term Loans Amortized Cost Basis by Origination Year
													Revolving
													Loans
											Term		Amortized		Grand
	2023		2022		2021		2020		Prior		Total		Cost Basis		Total
March 31, 2023
Consumer
Payment Performance
Performing	$	8,901	$	53,708	$	15,151	$	7,780	$	4,776	$	90,316	$	51	$	90,367
Nonperforming		-		-		19		-		2		21		-		21
Total Consumer	$	8,901	$	53,708	$	15,170	$	7,780	$	4,778	$	90,337	$	51	$	90,388
Gross charge-offs	$	73	$	13	$	7	$	29	$	-	$	122	$	-	$	122

Collateral-dependent Loans

The following table presents collateral-dependent loans grouped by collateral as of March 31, 2023:


	(In Thousands)
	Real
	Estate
Consumer Real Estate	$	-
Agricultural Real Estate		-
Agricultural		-
Commercial Real Estate		-
Commercial & Industrial		9
Consumer		-
Total	$	9

Schedule of Impaired Loans

Information about impaired loans as of December 31, 2022 and March 31, 2022 are presented for comparison purposes and are as follows:


	(In Thousands)
	December 31, 2022		March 31, 2022

Impaired loans without a valuation allowance	$	4,194	$	3,990
Impaired loans with a valuation allowance		4,663		8,634
Total impaired loans	$	8,857	$	12,624
Valuation allowance related to impaired loans	$	1,996	$	1,535
Total non-accrual loans	$	4,689	$	8,581
Total loans past-due ninety days or more and still accruing	$	-	$	-
Quarter ended average investment in impaired loans	$	9,660	$	12,764
Year to date average investment in impaired loans	$	10,710	$	12,764

Loans Individually Evaluated for Impairment by Portfolio Class of Loans

The following tables present loans individually evaluated for impairment by class of loans for the three months ended March 31, 2022 and for the year ended December 31, 2022.


	(In Thousands)
											QTD
							QTD		QTD		Interest
Three Months Ended March 31, 2022			Unpaid				Average		Interest		Income
	Recorded		Principal		Related		Recorded		Income		Recognized
	Investment		Balance		Allowance		Investment		Recognized		Cash Basis
With no related allowance recorded:
Consumer Real Estate	$	692	$	692	$	-	$	372	$	1	$	2
Agricultural Real Estate		2,172		2,276		-		1,145		7		2
Agricultural		20		20		-		20		-		-
Commercial Real Estate		749		749		-		660		4		5
Commercial and Industrial		334		334		-		254		2		-
Consumer		23		23		-		16		-		-
With a specific allowance recorded:
Consumer Real Estate		-		-		-		-		-		-
Agricultural Real Estate		4,498		4,498		273		5,550		-		-
Agricultural		-		-		-		-		-		-
Commercial Real Estate		3,348		3,348		632		3,745		37		-
Commercial and Industrial		788		788		630		994		14		-
Consumer		-		-		-		8		-		-
Totals:
Consumer Real Estate	$	692	$	692	$	-	$	372	$	1	$	2
Agricultural Real Estate	$	6,670	$	6,774	$	273	$	6,695	$	7	$	2
Agricultural	$	20	$	20	$	-	$	20	$	-	$	-
Commercial Real Estate	$	4,097	$	4,097	$	632	$	4,405	$	41	$	5
Commercial and Industrial	$	1,122	$	1,122	$	630	$	1,248	$	16	$	-
Consumer	$	23	$	23	$	-	$	24	$	-	$	-


	(In Thousands)
											Interest
Year Ended December 31, 2022			Unpaid				Average		Interest		Income
	Recorded		Principal		Related		Recorded		Income		Recognized
	Investment		Balance		Allowance		Investment		Recognized		Cash Basis
With no related allowance recorded:
Consumer Real Estate	$	509	$	509	$	-	$	355	$	5	$	12
Agricultural Real Estate		2,280		2,385		-		2,048		25		6
Agricultural		152		152		-		588		-		2
Commercial Real Estate		1,234		1,272		-		1,252		29		43
Commercial and Industrial		17		417		-		135		2		10
Consumer		2		2		-		15		1		-
With a specific allowance recorded:
Consumer Real Estate		60		60		6		15		-		1
Agricultural Real Estate		-		-		-		1,388		-		-
Agricultural		-		-		-		-		-		-
Commercial Real Estate		2,874		2,874		438		3,176		150		-
Commercial and Industrial		1,564		1,564		1,551		1,736		149		23
Consumer		165		165		1		2		-		-
Totals:
Consumer Real Estate	$	569	$	569	$	6	$	370	$	5	$	13
Agricultural Real Estate	$	2,280	$	2,385	$	-	$	3,436	$	25	$	6
Agricultural	$	152	$	152	$	-	$	588	$	-	$	2
Commercial Real Estate	$	4,108	$	4,146	$	438	$	4,428	$	179	$	43
Commercial and Industrial	$	1,581	$	1,981	$	1,551	$	1,871	$	151	$	33
Consumer	$	167	$	167	$	1	$	17	$	1	$	-

Analysis of Allowance for Credit Losses


	(In Thousands)
	Consumer Real Estate				Agricultural Real Estate			Agricultural			Commercial Real Estate		Commercial and Industrial			Consumer			Total
Three Months Ended March 31, 2023
ALLOWANCE FOR CREDIT LOSSES
Beginning balance	$	998			$	349		$	751		$	11,924	$	5,382		$	909		$	20,313
Adoption of ASU 2016-13		2,874		-		(166	)		(650	)		3,501		(2,165	)		170			3,564
Provision for credit losses - loans		(256	)			26			(35	)		661		191			230			817
Charge-offs		-				-			-			-		-			(122	)		(122	)
Recoveries		7				-			-			2		6			47			62
Ending Balance	$	3,623			$	209		$	66		$	16,088	$	3,414		$	1,234		$	24,634

The following table breaks down the activity in the AULC as of March 31, 2023:


	(In Thousands)
	Unfunded Loan Commitment & Letters of Credit
Three Months Ended March 31, 2023
ALLOWANCE FOR UNFUNDED LOAN COMMITMENTS AND LETTERS OF CREDIT
Beginning balance	$	1,262
Adoption of ASU 2016-13		904
Provision for credit losses - off balance sheet credit exposures		62
Charge-offs		-
Recoveries		-
Ending Balance	$	2,228

Additional analysis, presented in thousands, related to the ALLL for the three months ended March 31, 2022 in addition to the ending balances as of December 31, 2022 is as follows:


	Consumer Real Estate		Agricultural Real Estate			Agricultural		Commercial Real Estate		Commercial and Industrial			Consumer			Unfunded Loan Commitment & Letters of Credit		Unallocated		Total
Three Months Ended March 31, 2022
ALLOWANCE FOR CREDIT LOSSES:
Beginning balance	$	857	$	1,040		$	709	$	9,130	$	3,847		$	625		$	1,041	$	34	$	17,283
Charge Offs		-		-			-		-		(6	)		(88	)		-		-		(94	)
Recoveries		5		-			-		2		9			27			-		-		43
Provision (Credit)		30		(434	)		135		441		216			59			-		133		580
Other Non-interest expense related to unfunded		-		-			-		-		-			-			35		-		35
Ending Balance	$	892	$	606		$	844	$	9,573	$	4,066		$	623		$	1,076	$	167	$	17,847
Ending balance: individually evaluated for impairment	$	-	$	273		$	-	$	632	$	630		$	-		$	-	$	-	$	1,535
Ending balance: collectively evaluated for impairment	$	892	$	333		$	844	$	8,941	$	3,436		$	623		$	1,076	$	167	$	16,312
Ending balance: loans acquired with deteriorated credit quality	$	-	$	-		$	-	$	-	$	-		$	-		$	-	$	-	$	-
FINANCING RECEIVABLES:
Ending balance	$	410,064	$	195,901		$	140,847	$	909,408	$	248,362		$	57,638		$	-	$	-	$	1,962,220
Ending balance: individually evaluated for impairment	$	692	$	6,670		$	20	$	4,097	$	1,122		$	23		$	-	$	-	$	12,624
Ending balance: collectively evaluated for impairment	$	408,694	$	189,033		$	140,827	$	905,076	$	246,904		$	57,615		$	-	$	-	$	1,948,149
Ending balance: loans acquired with deteriorated credit quality	$	678	$	198		$	-	$	235	$	336		$	-		$	-	$	-	$	1,447


December 31, 2022	Consumer Real Estate		Agricultural Real Estate			Agricultural		Commercial Real Estate		Commercial and Industrial			Consumer			Unfunded Loan Commitment & Letters of Credit		Unallocated			Total
ALLOWANCE FOR CREDIT LOSSES:
Beginning balance	$	857	$	1,040		$	709	$	9,130	$	3,847		$	625		$	1,041	$	34		$	17,283
Charge Offs		-		-			-		-		(418	)		(409	)		-		-			(827	)
Recoveries		20		-			7		9		93			169			-		-			298
Provision (Credit)		121		(691	)		35		2,785		1,860			506			-		(16	)		4,600
Other Non-interest expense related to unfunded		-		-			-		-		-			-			221		-			221
Ending Balance	$	998	$	349		$	751	$	11,924	$	5,382		$	891		$	1,262	$	18		$	21,575
Ending balance: individually evaluated for impairment	$	6	$	-		$	-	$	438	$	1,551		$	1		$	-	$	-		$	1,996
Ending balance: collectively evaluated for impairment	$	992	$	349		$	751	$	11,486	$	3,831		$	890		$	1,262	$	18		$	19,579
Ending balance: loans acquired with deteriorated credit quality	$	-	$	-		$	-	$	-	$	-		$	-		$	-	$	-		$	-
FINANCING RECEIVABLES:
Ending balance	$	494,423	$	220,514		$	128,926	$	1,150,511	$	272,119		$	89,894		$	-	$	-		$	2,356,387
Ending balance: individually evaluated for impairment	$	569	$	2,280		$	152	$	4,108	$	1,581		$	167		$	-	$	-		$	8,857
Ending balance: collectively evaluated for impairment	$	493,449	$	218,039		$	128,774	$	1,146,389	$	270,493		$	89,727		$	-	$	-		$	2,346,871
Ending balance: loans acquired with deteriorated credit quality	$	405	$	195		$	-	$	14	$	45		$	-		$	-	$	-		$	659