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LOANS AND RELATED ALLOWANCE FOR LOAN LOSSES (Tables) | 12 Months Ended
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Dec. 31, 2022
LOANS AND RELATED ALLOWANCE FOR LOAN LOSSES [Abstract] |
Loan Portfolio and Allowance for Loan Losses | The Company grants commercial, industrial, agricultural, residential, and consumer loans primarily to customers throughout north central, central and south central Pennsylvania, southern New York and Wilmington and Dover, Delaware. Although the Company had a diversified loan portfolio at December 31, 2022 and 2021, a substantial portion of its debtors’ ability to honor their contracts is dependent on the economic conditions within these regions. The following table summarizes the primary segments of the loan portfolio, as well as how those segments are analyzed within the allowance for loan losses as of December 31, 2022 and 2021 (in thousands):
2022 |  | Total Loans |  |  | Individually evaluated for impairment |  |  | Loans acquired with deteriorated credit quality |  |  | Collectively evaluated for impairment |
Real estate loans: |  |  |  |  |  |  |  |  |  |  |  |
Residential |  | $ | 210,213 |  |  | $ | 335 |  |  | $ | 9 |  |  | $ | 209,869 |
Commercial |  |  | 876,569 |  |  |  | 5,675 |  |  |  | 1,856 |  |  |  | 869,038 |
Agricultural |  |  | 313,614 |  |  |  | 5,380 |  |  |  | 1,441 |  |  |  | 307,055 |
Construction |  |  | 80,691 |  |  |  | - |  |  |  | - |  |  |  | 80,691 |
Consumer |  |  | 86,650 |  |  |  | 4 |  |  |  | - |  |  |  | 86,646 |
Other commercial loans |  |  | 63,222 |  |  |  | 102 |  |  |  | - |  |  |  | 63,120 |
Other agricultural loans |  |  | 34,832 |  |  |  | 473 |  |  |  | - |  |  |  | 34,097 |
State and political subdivision loans |  |  | 59,208 |  |  |  | - |  |  |  | - |  |  |  | 59,208 |
Total |  |  | 1,724,999 |  |  |  | 11,969 |  |  |  | 3,306 |  |  |  | 1,709,724 |
Allowance for loan losses |  |  | 18,552 |  |  |  | 102 |  |  |  | - |  |  |  | 18,450 |
Net loans |  | $ | 1,706,447 |  |  | $ | 11,867 |  |  | $ | 3,306 |  |  | $ | 1,691,274 |
2021 |  |  |  |  |  |  |  |  |  |  |  |
Real estate loans: |  |  |  |  |  |  |  |  |  |  |  |
Residential |  | $ | 201,097 |  |  | $ | 620 |  |  | $ | 14 |  |  | $ | 200,463 |
Commercial |  |  | 687,338 |  |  |  | 8,381 |  |  |  | 2,145 |  |  |  | 676,812 |
Agricultural |  |  | 312,011 |  |  |  | 5,355 |  |  |  | 1,643 |  |  |  | 305,013 |
Construction |  |  | 55,036 |  |  |  | - |  |  |  | - |  |  |  | 55,036 |
Consumer |  |  | 25,858 |  |  |  | - |  |  |  | - |  |  |  | 25,858 |
Other commercial loans |  |  | 74,585 |  |  |  | 186 |  |  |  | - |  |  |  | 74,399 |
Other agricultural loans |  |  | 39,852 |  |  |  | 991 |  |  |  | - |  |  |  | 38,861 |
State and political subdivision loans |  |  | 45,756 |  |  |  | - |  |  |  | - |  |  |  | 45,756 |
Total |  |  | 1,441,533 |  |  |  | 15,533 |  |  |  | 3,802 |  |  |  | 1,422,198 |
Allowance for loan losses |  |  | 17,304 |  |  |  | 121 |  |  |  | - |  |  |  | 17,183 |
Net loans |  | $ | 1,424,229 |  |  | $ | 15,412 |  |  | $ | 3,802 |  |  | $ | 1,405,015 |
Purchase Accounting Adjustments Related to Purchased Impaired Loans Acquired | The table below presents the components of the purchase accounting adjustments related to the purchased impaired loans acquired in the MidCoast Acquisition as of April 17, 2020 (in thousands):
|  | April 17, 2020 |
Contractually required principal and interest at acquisition |  | $ | 8,801 |
Non-accretable discount |  |  | (2,966 | )
Expected cash flows |  |  | 5,835 |
Accretable discount |  |  | (966 | )
Estimated fair value |  | $ | 4,869 |
Accretable Yield for Purchased Credit Impaired Loans | Changes in the accretable discount for PCI loans were as follows for the years ended December 31, 2022 and 2021 (in thousands):
|  | December 31, 2022 |  |  | December 31, 2021 |
Balance at beginning of period |  | $ | 370 |  |  | $ | 788 |
Accretion |  |  | (759 | ) |  |  | (499 | )
Reclassification of non-accretable discount |  |  | 1,212 |  |  |  | 81 |
Balance at end of period |  | $ | 823 |  |  | $ | 370 |
Loans Acquired with Specific Evidence of Deterioration in Credit Quality | The following table presents additional information regarding PCI loans (in thousands):
|  | December 31, 2022 |  |  | December 31, 2021 |
Outstanding balance |  | $ | 5,758 |  |  | $ | 6,159 |
Carrying amount |  |  | 3,306 |  |  |  | 3,802 |
Impaired Loan Receivables with Associated Allowance Amount | The following table includes the recorded investment and unpaid principal balances for impaired loans by class, with the associated allowance amount as of December 31, 2022 and 2021, if applicable (in thousands):
|  | Unpaid Principal Balance |  |  | Recorded Investment With No Allowance |  |  | Recorded Investment With Allowance |  |  | Total Recorded Investment |  |  | Related Allowance |
2022 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Real estate loans: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Mortgages |  | $ | 395 |  |  | $ | 242 |  |  | $ | 39 |  |  | $ | 281 |  |  | $ | 4 |
Home Equity |  |  | 71 |  |  |  | 39 |  |  |  | 15 |  |  |  | 54 |  |  |  | - |
Commercial |  |  | 6,655 |  |  |  | 5,314 |  |  |  | 361 |  |  |  | 5,675 |  |  |  | 57 |
Agricultural |  |  | 6,062 |  |  |  | 5,192 |  |  |  | 188 |  |  |  | 5,380 |  |  |  | 24 |
Consumer |  |  | 4 |  |  |  | - |  |  |  | 4 |  |  |  | 4 |  |  |  | 4 |
Other commercial loans |  |  | 797 |  |  |  | 32 |  |  |  | 70 |  |  |  | 102 |  |  |  | 13 |
Other agricultural loans |  |  | 669 |  |  |  | 473 |  |  |  | - |  |  |  | 473 |  |  |  | - |
Total |  | $ | 14,653 |  |  | $ | 11,292 |  |  | $ | 677 |  |  | $ | 11,969 |  |  | $ | 102 |
2021 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Real estate loans: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Mortgages |  | $ | 697 |  |  | $ | 495 |  |  | $ | 45 |  |  | $ | 540 |  |  | $ | 6 |
Home Equity |  |  | 97 |  |  |  | 37 |  |  |  | 43 |  |  |  | 80 |  |  |  | 6 |
Commercial |  |  | 9,330 |  |  |  | 8,096 |  |  |  | 285 |  |  |  | 8,381 |  |  |  | 61 |
Agricultural |  |  | 5,694 |  |  |  | 5,167 |  |  |  | 188 |  |  |  | 5,355 |  |  |  | 14 |
Other commercial loans |  |  | 813 |  |  |  | 92 |  |  |  | 94 |  |  |  | 186 |  |  |  | 34 |
Other agricultural loans |  |  | 1,274 |  |  |  | 991 |  |  |  | - |  |  |  | 991 |  |  |  | - |
Total |  | $ | 17,905 |  |  | $ | 14,878 |  |  | $ | 655 |  |  | $ | 15,533 |  |  | $ | 121 |
The following table includes the average investment in impaired loans and the income recognized on impaired loans for 2022, 2021 and 2020 (in thousands):
|  |  |  |  |  |  |  | Interest |
|  | Average |  |  | Interest |  |  | Income |
|  | Recorded |  |  | Income |  |  | Recognized |
2022 |  | Investment |  |  | Recognized |  |  | Cash Basis |
Real estate loans: |  |  |  |  |  |  |  |  |
Mortgages |  | $ | 421 |  |  | $ | 12 |  |  | $ | - |
Home Equity |  |  | 64 |  |  |  | 4 |  |  |  | - |
Commercial |  |  | 6,216 |  |  |  | 207 |  |  |  | 10 |
Agricultural |  |  | 5,540 |  |  |  | 126 |  |  |  | - |
Consumer |  |  | 1 |  |  |  | - |  |  |  | - |
Other commercial loans |  |  | 260 |  |  |  | 3 |  |  |  | - |
Other agricultural loans |  |  | 538 |  |  |  | 4 |  |  |  | - |
Total |  | $ | 13,040 |  |  | $ | 356 |  |  | $ | 10 |
2021 |  |  |  |  |  |  |  |  |
Real estate loans: |  |  |  |  |  |  |  |  |
Mortgages |  | $ | 682 |  |  | $ | 16 |  |  | $ | - |
Home Equity |  |  | 99 |  |  |  | 4 |  |  |  | - |
Commercial |  |  | 8,789 |  |  |  | 288 |  |  |  | 31 |
Agricultural |  |  | 4,562 |  |  |  | 82 |  |  |  | - |
Other commercial loans |  |  | 704 |  |  |  | 2 |  |  |  | - |
Other agricultural loans |  |  | 1,044 |  |  |  | 3 |  |  |  | - |
Total |  | $ | 15,880 |  |  | $ | 395 |  |  | $ | 31 |
|  |  |  |  |  |  |  | Interest |
|  | Average |  |  | Interest |  |  | Income |
|  | Recorded |  |  | Income |  |  | Recognized |
2020 |  | Investment |  |  | Recognized |  |  | Cash Basis |
Real estate loans: |  |  |  |  |  |  |  |  |
Mortgages |  | $ | 956 |  |  | $ | 20 |  |  | $ | - |
Home Equity |  |  | 139 |  |  |  | 6 |  |  |  | - |
Commercial |  |  | 10,354 |  |  |  | 358 |  |  |  | 27 |
Agricultural |  |  | 3,918 |  |  |  | 75 |  |  |  | - |
Consumer |  |  | 3 |  |  |  | - |  |  |  | - |
Other commercial loans |  |  | 1,671 |  |  |  | 3 |  |  |  | - |
Other agricultural loans |  |  | 1,237 |  |  |  | 6 |  |  |  | - |
Total |  | $ | 18,278 |  |  | $ | 468 |  |  | $ | 27 |
Financing Receivable Credit Exposures by Internally Assigned Grades | The following tables represent credit exposures by internally assigned grades as of December 31, 2022 and 2021 (in thousands):
2022 |  | Pass |  |  | Special Mention |  |  | Substandard |  |  | Doubtful |  |  | Loss |  |  | Ending Balance |
Real estate loans: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial |  | $ | 842,912 |  |  | $ | 28,047 |  |  | $ | 5,610 |  |  | $ | - |  |  | $ | - |  |  | $ | 876,569 |
Agricultural |  |  | 295,443 |  |  |  | 11,960 |  |  |  | 6,211 |  |  |  | - |  |  |  | - |  |  |  | 313,614 |
Construction |  |  | 75,703 |  |  |  | 2,642 |  |  |  | 2,346 |  |  |  | - |  |  |  | - |  |  |  | 80,691 |
Other commercial loans |  |  | 59,902 |  |  |  | 2,953 |  |  |  | 337 |  |  |  | 30 |  |  |  | - |  |  |  | 63,222 |
Other agricultural loans |  |  | 32,708 |  |  |  | 1,307 |  |  |  | 817 |  |  |  | - |  |  |  | - |  |  |  | 34,832 |
State and political subdivision loans |  |  | 59,208 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 59,208 |
Total |  | $ | 1,365,876 |  |  | $ | 46,909 |  |  | $ | 15,321 |  |  | $ | 30 |  |  | $ | - |  |  | $ | 1,428,136 |
2021 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Real estate loans: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial |  | $ | 646,137 |  |  | $ | 35,332 |  |  | $ | 5,869 |  |  | $ | - |  |  | $ | - |  |  | $ | 687,338 |
Agricultural |  |  | 291,537 |  |  |  | 15,105 |  |  |  | 5,369 |  |  |  | - |  |  |  | - |  |  |  | 312,011 |
Construction |  |  | 55,036 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 55,036 |
Other commercial loans |  |  | 70,932 |  |  |  | 3,289 |  |  |  | 316 |  |  |  | 48 |  |  |  | - |  |  |  | 74,585 |
Other agricultural loans |  |  | 37,800 |  |  |  | 1,351 |  |  |  | 701 |  |  |  | - |  |  |  | - |  |  |  | 39,852 |
State and political subdivision loans |  |  | 45,588 |  |  |  | 168 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 45,756 |
Total |  | $ | 1,147,030 |  |  | $ | 55,245 |  |  | $ | 12,255 |  |  | $ | 48 |  |  | $ | - |  |  | $ | 1,214,578 |
For residential real estate mortgages, home equities and consumer loans, credit quality is monitored based on whether the loan is performing or non-performing, which is typically based on the aging status of the loan and payment activity, unless a specific action, such as bankruptcy, repossession, death or significant delay in payment occurs to raise awareness of a possible credit event. Non-performing loans include those loans that are considered nonaccrual, described in more detail below and all loans past due 90 or more days. The following table presents the recorded investment in those loan classes based on payment activity as of December 31, 2022 and 2021 (in thousands):
2022 |  | Performing |  |  | Non-performing |  |  | PCI |  |  | Total |
Real estate loans: |  |  |  |  |  |  |  |  |  |  |  |
Mortgages |  | $ | 161,998 |  |  | $ | 562 |  |  | $ | 9 |  |  | $ | 162,569 |
Home Equity |  |  | 47,615 |  |  |  | 29 |  |  |  | - |  |  |  | 47,644 |
Consumer |  |  | 86,643 |  |  |  | 7 |  |  |  | - |  |  |  | 86,650 |
Total |  | $ | 296,256 |  |  | $ | 598 |  |  | $ | 9 |  |  | $ | 296,863 |
2021 |  | Performing |  |  | Non-performing |  |  | PCI |  |  | Total |
Real estate loans: |  |  |  |  |  |  |  |  |  |  |  |
Mortgages |  | $ | 150,320 |  |  | $ | 608 |  |  | $ | 14 |  |  | $ | 150,942 |
Home Equity |  |  | 50,122 |  |  |  | 33 |  |  |  | - |  |  |  | 50,155 |
Consumer |  |  | 25,858 |  |  |  | - |  |  |  | - |  |  |  | 25,858 |
Total |  | $ | 226,300 |  |  | $ | 641 |  |  | $ | 14 |  |  | $ | 226,955 |
Aging Analysis of Past Due Loan Receivables | Management further monitors the performance and credit quality of the loan portfolio by analyzing the age of the portfolio as determined by the length of time a recorded payment is past due. The following table includes an aging analysis of the recorded investment of past due loans as of December 31, 2022 and 2021 (in thousands):
|  | 30-59 Days |  |  | 60-89 Days |  |  | 90 Days |  |  | Total Past |  |  |  |  |  |  |  |  | Total Financing |  |  | 90 Days and |
2022 |  | Past Due |  |  | Past Due |  |  | Or Greater |  |  | Due |  |  | Current |  |  | PCI |  |  | Receivables |  |  | Accruing |
Real estate loans: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Mortgages |  | $ | 356 |  |  | $ | 132 |  |  | $ | 229 |  |  | $ | 717 |  |  | $ | 161,843 |  |  | $ | 9 |  |  | $ | 162,569 |  |  | $ | - |
Home Equity |  |  | 48 |  |  |  | 9 |  |  |  | 29 |  |  |  | 86 |  |  |  | 47,558 |  |  |  | - |  |  |  | 47,644 |  |  |  | - |
Commercial |  |  | 1,065 |  |  |  | 115 |  |  |  | 1,788 |  |  |  | 2,968 |  |  |  | 871,745 |  |  |  | 1,856 |  |  |  | 876,569 |  |  |  | - |
Agricultural |  |  | - |  |  |  | - |  |  |  | 1,368 |  |  |  | 1,368 |  |  |  | 310,805 |  |  |  | 1,441 |  |  |  | 313,614 |  |  |  | - |
Construction |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 80,691 |  |  |  | - |  |  |  | 80,691 |  |  |  | - |
Consumer |  |  | 147 |  |  |  | - |  |  |  | 7 |  |  |  | 154 |  |  |  | 86,496 |  |  |  | - |  |  |  | 86,650 |  |  |  | 7 |
Other commercial loans |  |  | 1,660 |  |  |  | 35 |  |  |  | 32 |  |  |  | 1,727 |  |  |  | 61,495 |  |  |  | - |  |  |  | 63,222 |  |  |  | - |
Other agricultural loans |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 34,832 |  |  |  | - |  |  |  | 34,832 |  |  |  | - |
State and political |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
subdivision loans |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 59,208 |  |  |  | - |  |  |  | 59,208 |  |  |  | - |
Total |  | $ | 3,276 |  |  | $ | 291 |  |  | $ | 3,453 |  |  | $ | 7,020 |  |  | $ | 1,714,673 |  |  | $ | 3,306 |  |  | $ | 1,724,999 |  |  | $ | 7 |
Loans considered non-accrual |  | $ | 46 |  |  | $ | 76 |  |  | $ | 3,446 |  |  | $ | 3,568 |  |  | $ | 3,370 |  |  | $ | - |  |  | $ | 6,938 |  |  |  |  |
Loans still accruing |  |  | 3,230 |  |  |  | 215 |  |  |  | 7 |  |  |  | 3,452 |  |  |  | 1,711,303 |  |  |  | 3,306 |  |  |  | 1,718,061 |  |  |  |  |
Total |  | $ | 3,276 |  |  | $ | 291 |  |  | $ | 3,453 |  |  | $ | 7,020 |  |  | $ | 1,714,673 |  |  | $ | 3,306 |  |  | $ | 1,724,999 |  |  |  |  |
2021 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Real estate loans: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Mortgages |  | $ | 220 |  |  | $ | 170 |  |  | $ | 209 |  |  | $ | 599 |  |  | $ | 150,329 |  |  | $ | 14 |  |  | $ | 150,942 |  |  | $ | 13 |
Home Equity |  |  | 103 |  |  |  | - |  |  |  | 33 |  |  |  | 136 |  |  |  | 50,019 |  |  |  | - |  |  |  | 50,155 |  |  |  | 33 |
Commercial |  |  | 127 |  |  |  | 115 |  |  |  | 1,969 |  |  |  | 2,211 |  |  |  | 682,982 |  |  |  | 2,145 |  |  |  | 687,338 |  |  |  | - |
Agricultural |  |  | 31 |  |  |  | - |  |  |  | 1,367 |  |  |  | 1,398 |  |  |  | 308,970 |  |  |  | 1,643 |  |  |  | 312,011 |  |  |  | - |
Construction |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 55,036 |  |  |  | - |  |  |  | 55,036 |  |  |  | - |
Consumer |  |  | 163 |  |  |  | 1 |  |  |  | - |  |  |  | 164 |  |  |  | 25,694 |  |  |  | - |  |  |  | 25,858 |  |  |  | - |
Other commercial loans |  |  | 17 |  |  |  | 10 |  |  |  | 92 |  |  |  | 119 |  |  |  | 74,466 |  |  |  | - |  |  |  | 74,585 |  |  |  | - |
Other agricultural loans |  |  | 10 |  |  |  | - |  |  |  | - |  |  |  | 10 |  |  |  | 39,842 |  |  |  | - |  |  |  | 39,852 |  |  |  | - |
State and political |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
subdivision loans |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 45,756 |  |  |  | - |  |  |  | 45,756 |  |  |  | - |
Total |  | $ | 671 |  |  | $ | 296 |  |  | $ | 3,670 |  |  | $ | 4,637 |  |  | $ | 1,433,094 |  |  | $ | 3,802 |  |  | $ | 1,441,533 |  |  | $ | 46 |
Loans considered non-accrual |  | $ | - |  |  | $ | - |  |  | $ | 3,624 |  |  | $ | 3,624 |  |  | $ | 3,992 |  |  | $ | - |  |  | $ | 7,616 |  |  |  |  |
Loans still accruing |  |  | 671 |  |  |  | 296 |  |  |  | 46 |  |  |  | 1,013 |  |  |  | 1,429,102 |  |  |  | 3,802 |  |  |  | 1,433,917 |  |  |  |  |
Total |  | $ | 671 |  |  | $ | 296 |  |  | $ | 3,670 |  |  | $ | 4,637 |  |  | $ | 1,433,094 |  |  | $ | 3,802 |  |  | $ | 1,441,533 |  |  |  |  |
Loan Receivables on Nonaccrual Status | The following table reflects the loans on nonaccrual status as of December 31, 2022 and 2021, respectively. The balances are presented by class of loan (in thousands):
|  | 2022 |  |  | 2021 |
Real estate loans: |  |  |  |  |  |
Mortgages |  | $ | 562 |  |  | $ | 595 |
Home Equity |  |  | 29 |  |  |  | - |
Commercial |  |  | 2,778 |  |  |  | 2,945 |
Agricultural |  |  | 3,222 |  |  |  | 3,133 |
Other commercial loans |  |  | 62 |  |  |  | 140 |
Other agricultural loans |  |  | 285 |  |  |  | 803 |
|  | $ | 6,938 |  |  | $ | 7,616 |
Troubled Debt Restructurings on Financing Receivables | Loan modifications that are considered TDRs completed during the years ended December 31, 2022, 2021 and 2020 were as follows (dollars in thousands):
|  | Number of contracts |  |  | Pre-modification Outstanding Recorded Investment |  |  | Post-Modification Outstanding Recorded Investment |
2022 |  | Interest Modification |  |  | Term Modification |  |  | Interest Modification |  |  | Term Modification |  |  | Interest Modification |  |  | Term Modification |
Real estate loans: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Home Equity |  |  | - |  |  |  | 1 |  |  | $ | - |  |  | $ | 8 |  |  | $ | - |  |  | $ | 8 |
Commercial |  |  | - |  |  |  | 4 |  |  |  | - |  |  |  | 2,301 |  |  |  | - |  |  |  | 2,301 |
Agricultural |  |  | - |  |  |  | 2 |  |  |  | - |  |  |  | 1,137 |  |  |  | - |  |  |  | 1,137 |
Total |  |  | - |  |  |  | 7 |  |  | $ | - |  |  | $ | 3,446 |  |  | $ | - |  |  | $ | 3,446 |
2021 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Real estate loans: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial |  |  | - |  |  |  | 4 |  |  | $ | - |  |  | $ | 1,469 |  |  | $ | - |  |  | $ | 1,469 |
Agricultural |  |  | - |  |  |  | 4 |  |  |  | - |  |  |  | 2,090 |  |  |  | - |  |  |  | 2,090 |
Total |  |  | - |  |  |  | 8 |  |  | $ | - |  |  | $ | 3,559 |  |  | $ | - |  |  | $ | 3,559 |
2020 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Real estate loans: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Mortgages |  |  | - |  |  |  | 1 |  |  | $ | - |  |  | $ | 2 |  |  | $ | - |  |  | $ | 2 |
Commercial |  |  | - |  |  |  | 10 |  |  |  | - |  |  |  | 2,456 |  |  |  | - |  |  |  | 2,456 |
Agricultural |  |  | - |  |  |  | 2 |  |  |  | - |  |  |  | 494 |  |  |  | - |  |  |  | 494 |
Consumer |  |  | - |  |  |  | 1 |  |  |  | - |  |  |  | 3 |  |  |  | - |  |  |  | 3 |
Other commercial loans |  |  | - |  |  |  | 2 |  |  |  | - |  |  |  | 1,094 |  |  |  | - |  |  |  | 1,094 |
Other agricultural loans |  |  | - |  |  |  | 1 |  |  |  | - |  |  |  | 19 |  |  |  | - |  |  |  | 19 |
Total |  |  | - |  |  |  | 17 |  |  | $ | - |  |  | $ | 4,068 |  |  | $ | - |  |  | $ | 4,068 |
Subsequent Default Recorded Investment | Recidivism, or the borrower defaulting on its obligation pursuant to a modified loan, results in the loan once again becoming a non-accrual loan. Recidivism occurs at a notably higher rate than do defaults on new origination loans, so modified loans present a higher risk of loss than do new origination loans. The following table presents the recorded investment in loans that were modified as TDRs during each 12-month period prior to the current reporting periods, which begin January 1, 2022, 2021 and 2020, respectively, and that subsequently defaulted during these reporting periods (dollars in thousands):
|  | December 31, 2022 |  |  | December 31, 2021 |  |  | December 31, 2020 |
|  | Number of contracts |  |  | Recorded investment |  |  | Number of contracts |  |  | Recorded investment |  |  | Number of contracts |  |  | Recorded investment |
Real estate loans: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial |  |  | - |  |  | $ | - |  |  |  | - |  |  | $ | - |  |  |  | 1 |  |  | $ | 110 |
Total recidivism |  |  | - |  |  | $ | - |  |  |  | - |  |  | $ | - |  |  |  | 1 |  |  | $ | 110 |
Roll forward of Allowance for Loan Losses by Portfolio Segment | The following tables roll forward the balance of the allowance for loan and lease losses for the years ended December 31, 2022, 2021 and 2020 and is segregated into the amount required for loans individually evaluated for impairment and the amount required for loans collectively evaluated for impairment as of December 31, 2022, 2021 and 2020 (in thousands):
|  | Balance at December 31, 2021 |  |  | Charge-offs |  |  | Recoveries |  |  | Provision |  |  | Balance at December 31, 2022 |  |  | Individually evaluated for impairment |  |  | Collectively evaluated for impairment |
Real estate loans: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Residential |  | $ | 1,147 |  |  | $ | - |  |  | $ | - |  |  | $ | (91 | ) |  | $ | 1,056 |  |  | $ | 4 |  |  | $ | 1,052 |
Commercial |  |  | 8,099 |  |  |  | - |  |  |  | 3 |  |  |  | 2,018 |  |  |  | 10,120 |  |  |  | 57 |  |  |  | 10,063 |
Agricultural |  |  | 4,729 |  |  |  | - |  |  |  | - |  |  |  | (140 | ) |  |  | 4,589 |  |  |  | 24 |  |  |  | 4,565 |
Construction |  |  | 434 |  |  |  | - |  |  |  | - |  |  |  | 367 |  |  |  | 801 |  |  |  | - |  |  |  | 801 |
Consumer |  |  | 262 |  |  |  | (37 | ) |  |  | 21 |  |  |  | (111 | ) |  |  | 135 |  |  |  | 4 |  |  |  | 131 |
Other commercial loans |  |  | 1,023 |  |  |  | (435 | ) |  |  | 13 |  |  |  | 439 |  |  |  | 1,040 |  |  |  | 13 |  |  |  | 1,027 |
Other agricultural loans |  |  | 558 |  |  |  | - |  |  |  | - |  |  |  | (69 | ) |  |  | 489 |  |  |  | - |  |  |  | 489 |
State and political subdivision loans |  |  | 281 |  |  |  | - |  |  |  | - |  |  |  | 41 |  |  |  | 322 |  |  |  | - |  |  |  | 322 |
Unallocated |  |  | 771 |  |  |  | - |  |  |  | - |  |  |  | (771 | ) |  |  | - |  |  |  | - |  |  |  | - |
Total |  | $ | 17,304 |  |  | $ | (472 | ) |  | $ | 37 |  |  | $ | 1,683 |  |  | $ | 18,552 |  |  | $ | 102 |  |  | $ | 18,450 |
|  | Balance at December 31, 2020 |  |  | Charge-offs |  |  | Recoveries |  |  | Provision |  |  | Balance at December 31, 2021 |  |  | Individually evaluated for impairment |  |  | Collectively evaluated for impairment |
Real estate loans: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Residential |  | $ | 1,174 |  |  | $ | - |  |  | $ | - |  |  | $ | (27 | ) |  | $ | 1,147 |  |  | $ | 12 |  |  | $ | 1,135 |
Commercial |  |  | 6,216 |  |  |  | (54 | ) |  |  | 89 |  |  |  | 1,848 |  |  |  | 8,099 |  |  |  | 61 |  |  |  | 8,038 |
Agricultural |  |  | 4,953 |  |  |  | - |  |  |  | - |  |  |  | (224 | ) |  |  | 4,729 |  |  |  | 14 |  |  |  | 4,715 |
Construction |  |  | 122 |  |  |  | - |  |  |  | - |  |  |  | 312 |  |  |  | 434 |  |  |  | - |  |  |  | 434 |
Consumer |  |  | 321 |  |  |  | (27 | ) |  |  | 21 |  |  |  | (53 | ) |  |  | 262 |  |  |  | - |  |  |  | 262 |
Other commercial loans |  |  | 1,226 |  |  |  | (133 | ) |  |  | 43 |  |  |  | (113 | ) |  |  | 1,023 |  |  |  | 34 |  |  |  | 989 |
Other agricultural loans |  |  | 864 |  |  |  | - |  |  |  | - |  |  |  | (306 | ) |  |  | 558 |  |  |  | - |  |  |  | 558 |
State and political subdivision loans |  |  | 479 |  |  |  | - |  |  |  | - |  |  |  | (198 | ) |  |  | 281 |  |  |  | - |  |  |  | 281 |
Unallocated |  |  | 460 |  |  |  | - |  |  |  | - |  |  |  | 311 |  |  |  | 771 |  |  |  | - |  |  |  | 771 |
Total |  | $ | 15,815 |  |  | $ | (214 | ) |  | $ | 153 |  |  | $ | 1,550 |  |  | $ | 17,304 |  |  | $ | 121 |  |  | $ | 17,183 |
|  | Balance at December 31, 2019 |  |  | Charge-offs |  |  | Recoveries |  |  | Provision |  |  | Balance at December 31, 2020 |  |  | Individually evaluated for impairment |  |  | Collectively evaluated for impairment |
Real estate loans: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Residential |  | $ | 1,114 |  |  | $ | - |  |  | $ | 14 |  |  | $ | 46 |  |  | $ | 1,174 |  |  | $ | 18 |  |  | $ | 1,156 |
Commercial |  |  | 4,549 |  |  |  | (435 | ) |  |  | 37 |  |  |  | 2,065 |  |  |  | 6,216 |  |  |  | 95 |  |  |  | 6,121 |
Agricultural |  |  | 5,022 |  |  |  | (4 | ) |  |  | 19 |  |  |  | (84 | ) |  |  | 4,953 |  |  |  | 83 |  |  |  | 4,870 |
Construction |  |  | 43 |  |  |  | - |  |  |  | - |  |  |  | 79 |  |  |  | 122 |  |  |  | - |  |  |  | 122 |
Consumer |  |  | 112 |  |  |  | (50 | ) |  |  | 21 |  |  |  | 238 |  |  |  | 321 |  |  |  | - |  |  |  | 321 |
Other commercial loans |  |  | 1,255 |  |  |  | (44 | ) |  |  | 12 |  |  |  | 3 |  |  |  | 1,226 |  |  |  | 170 |  |  |  | 1,056 |
Other agricultural loans |  |  | 961 |  |  |  | - |  |  |  | - |  |  |  | (97 | ) |  |  | 864 |  |  |  | 144 |  |  |  | 720 |
State and political subdivision loans |  |  | 536 |  |  |  | - |  |  |  | - |  |  |  | (57 | ) |  |  | 479 |  |  |  | - |  |  |  | 479 |
Unallocated |  |  | 253 |  |  |  | - |  |  |  | - |  |  |  | 207 |  |  |  | 460 |  |  |  | - |  |  |  | 460 |
Total |  | $ | 13,845 |  |  | $ | (533 | ) |  | $ | 103 |  |  | $ | 2,400 |  |  | $ | 15,815 |  |  | $ | 510 |  |  | $ | 15,305 |

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