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Loans
 9 Months Ended
Sep. 30, 2025
Loans [Abstract]  
Loans
Note 5 – Loans

The Company originates commercial, industrial, agricultural, residential, and consumer loans primarily to customers throughout north central, central and south central Pennsylvania, southern New York, and Wilmington, Dover and Georgetown, Delaware. The most recent acquisition expanded our lending market further into southeast Pennsylvania, including Montgomery, Bucks and Philadelphia Counties as well as Burlington County, New Jersey. Although the Company had a diversified loan portfolio at September 30, 2025 and December 31, 2024, 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 and how those segments are analyzed within the allowance for credit losses - loans as of September 30, 2025 and December 31, 2024 (in thousands):
   
September 30, 2025
    
December 31 , 2024
  
Real estate loans:
            
Residential
  
$
344,790
    
$
351,398
  
Commercial
    
1,180,655
      
1,121,435
  
Agricultural
    
342,487
      
327,722
  
Construction
    
107,867
      
164,326
  
Consumer
    
109,458
      
109,505
  
Other commercial loans
    
171,345
      
155,012
  
Other agricultural loans
    
27,142
      
29,662
  
State and political subdivision loans
    
51,644
      
54,182
  
Total
    
2,335,388
      
2,313,242
  
Allowance for credit losses - loans
    
22,454
      
21,699
  
Net loans
  
$
2,312,934
    
$
2,291,543
  

Allowance for Credit Losses - Loans

The allowance for credit losses related to loans consists of loans evaluated collectively and individually for expected credit losses. It represents an estimate of credit losses over the expected life of the loans as of the balance sheet date and is recorded as a reduction to net loans. Loans individually evaluated consist of non-accrual commercial loans and recently modified loans that were experiencing financial difficulty at the time of the modification. The allowance for credit losses for off-balance sheet credit exposures includes estimated losses on unfunded loan commitments, letters of credit and other off-balance sheet credit exposures. The total allowance for credit losses is increased by charges to expense, through the provision for credit losses, and decreased by charge-offs, net of recoveries.

The following table presents the components of the allowance for credit losses as of September 30, 2025 and December 31, 2024 (in thousands):

   
September 30, 2025
    
December 31, 2024
  
Allowance for Credit Losses - Loans
  
$
22,454
    
$
21,699
  
Allowance for Credit Losses - Off-Balance Sheet credit Exposure
    
1,066
      
676
  
Total allowance for credit losses
  
$
23,520
    
$
22,375
  

The following table presents the activity in the allowance for credit losses for the three and nine months ended September 30, 2025 and 2024 (in thousands):

   
Allowance for Credit
Losses - Loans
    
Allowance for Credit
Losses - Off-Balance
Sheet credit Exposure
    
Total
  
Balance at June 30, 2025
  
$
22,109
    
$
914
    
$
23,023
  
Loans charge-off
    
(20
)
    
-
      
(20
)
Recoveries of loans previously charged-off
    
17
      
-
      
17
  
Net loans charged-off
    
(3
)
    
-
      
(3
)
Provision for credit losses
    
348
      
152
      
500
  
Balance at September 30, 2025
  
$
22,454
    
$
1,066
    
$
23,520
  
                         
Balance at December 31, 2024
  
$
21,699
    
$
676
    
$
22,375
  
Loans charge-off
    
(801
)
    
-
      
(801
)
Recoveries of loans previously charged-off
    
71
      
-
      
71
  
Net loans charged-off
    
(730
)
    
-
      
(730
)
Provision for credit losses
    
1,485
      
390
      
1,875
  
Balance at September 30, 2025
  
$
22,454
    
$
1,066
    
$
23,520
  
   
Allowance for Credit
Losses - Loans
    
Allowance for Credit
Losses - Off-Balance Sheet
credit Exposure
    
Total
  
Balance at June 30, 2024
  
$
22,797
    
$
1,066
    
$
23,863
  
Loans charge-off
    
(1,212
)
    
-
      
(1,212
)
Recoveries of loans previously charged-off
    
10
      
-
      
10
  
Net loans charged-off
    
(1,202
)
    
-
      
(1,202
)
Provision for credit losses
    
100
      
(300
)
    
(200
)
Balance at September 30, 2024
  
$
21,695
    
$
766
    
$
22,461
  
                         
Balance at December 31, 2023
  
$
21,153
    
$
1,265
    
$
22,418
  
Loans charge-off
    
(2,568
)
    
-
      
(2,568
)
Recoveries of loans previously charged-off
    
24
      
-
      
24
  
Net loans charged-off
    
(2,544
)
    
-
      
(2,544
)
Provision for credit losses
    
3,086
      
(499
)
    
2,587
  
Balance at September 30, 2024
  
$
21,695
    
$
766
    
$
22,461
  

The following tables present the activity in the allowance for credit losses – loans, by portfolio segment, for the three and nine months ended September 30, 2025 and 2024 (in thousands):

   
For the three months ended September 30, 2025
  
   
Balance at June
30, 2025
    
Charge-offs
    
Recoveries
    
Provision
    
Balance at
September 30, 2025
  
Real estate loans:
                              
Residential
  
$
3,062
    
$
-
    
$
-
    
$
148
    
$
3,210
  
Commercial
    
9,898
      
-
      
-
      
(445
)
    
9,453
  
Agricultural
    
4,542
      
-
      
-
      
262
      
4,804
  
Construction
    
1,273
      
-
      
-
      
(306
)
    
967
  
Consumer
    
1,119
      
(10
)
    
4
      
212
      
1,325
  
Other commercial loans
    
1,993
      
(10
)
    
13
      
435
      
2,431
  
Other agricultural loans
    
132
      
-
      
-
      
(7
)
    
125
  
State and political subdivision loans
    
56
      
-
      
-
      
2
      
58
  
Unallocated
    
34
      
-
      
-
      
47
      
81
  
Total
  
$
22,109
    
$
(20
)
  
$
17
    
$
348
    
$
22,454
  

   
For the nine months ended September 30, 2025
  
   
Balance at
December 31, 2024
    
Charge-offs
    
Recoveries
    
Provision
    
Balance at
September 30, 2025
  
Real estate loans:
                              
Residential
  
$
1,940
    
$
-
    
$
-
    
$
1,270
    
$
3,210
  
Commercial
    
9,174
      
(40
)
    
-
      
319
      
9,453
  
Agricultural
    
3,529
      
-
      
-
      
1,275
      
4,804
  
Construction
    
1,402
      
-
      
-
      
(435
)
    
967
  
Consumer
    
1,338
      
(307
)
    
37
      
257
      
1,325
  
Other commercial loans
    
3,766
      
(454
)
    
34
      
(915
)
    
2,431
  
Other agricultural loans
    
133
      
-
      
-
      
(8
)
    
125
  
State and political subdivision loans
    
61
      
-
      
-
      
(3
)
    
58
  
Unallocated
    
356
      
-
      
-
      
(275
)
    
81
  
Total
  
$
21,699
    
$
(801
)
  
$
71
    
$
1,485
    
$
22,454
  
   
For the three months ended September 30, 2024
  
   
Balance at
June 30, 2024
    
Charge-offs
    
Recoveries
    
Provision
    
Balance at
September 30, 2024
  
Real estate loans:
                              
Residential
  
$
2,355
    
$
(4
)
  
$
-
    
$
(365
)
  
$
1,986
  
Commercial
    
10,283
      
-
      
-
      
(996
)
    
9,287
  
Agricultural
    
3,770
      
-
      
-
      
45
      
3,815
  
Construction
    
1,627
      
-
      
-
      
(156
)
    
1,471
  
Consumer
    
1,008
      
(25
)
    
6
      
174
      
1,163
  
Other commercial loans
    
3,459
      
(1,183
)
    
4
      
(252
)
    
2,028
  
Other agricultural loans
    
206
      
-
      
-
      
(90
)
    
116
  
State and political subdivision loans
    
63
      
-
      
-
      
-
      
63
  
Unallocated
    
26
      
-
      
-
      
1,740
      
1,766
  
Total
  
$
22,797
    
$
(1,212
)
  
$
10
    
$
100
    
$
21,695
  

   
For the nine months ended September 30, 2024
  
   
Balance at
December 31, 2023
    
Charge-offs
    
Recoveries
    
Provision
    
Balance at
 September 30, 2024
  
Real estate loans:
                              
Residential
  
$
2,354
    
$
(4
)
  
$
-
    
$
(364
)
  
$
1,986
  
Commercial
    
9,178
      
-
      
-
      
109
      
9,287
  
Agricultural
    
3,264
      
-
      
-
      
551
      
3,815
  
Construction
    
1,950
      
-
      
-
      
(479
)
    
1,471
  
Consumer
    
1,412
      
(62
)
    
16
      
(203
)
    
1,163
  
Other commercial loans
    
2,313
      
(2,502
)
    
8
      
2,209
      
2,028
  
Other agricultural loans
    
270
      
-
      
-
      
(154
)
    
116
  
State and political subdivision loans
    
45
      
-
      
-
      
18
      
63
  
Unallocated
    
367
      
-
      
-
      
1,399
      
1,766
  
Total
  
$
21,153
    
$
(2,568
)
  
$
24
    
$
3,086
    
$
21,695
  

The provision for the first nine months of 2025 was driven by changes in economic forecasts and the annual update of the loss driver analysis. This update includes revising prepayment and curtailment speeds. In addition, loss rates are updated to include the most recent completed year of 2024. For residential loans, the historical loss rate increased, while the prepayment speed slowed resulting in an increased provision. For other commercial loans, the historical loss rate decreased in the annual update resulting in a decrease in the provision for 2025.

The provision for the first nine months of 2024 was driven by the annual update of the loss driver analysis and recording specific reserves for certain other commercial loans. This update includes revising prepayment and curtailment speeds. In addition, loss rates are updated to include the most recent completed year of 2023.

The following table presents the allowance for credit losses – loans and amortized cost basis of loans as of September 30, 2025 and December 31, 2024 (in thousands):
   
Allowance for Credit Losses - Loans
    
Loans
  
September 30, 2025
  
Collectively
evaluated
    
Individually
evaluated
    
Total Allowance
for Credit
Losses - Loans
    
Collectively
evaluated
    
Individually
evaluated
    
Total Loans
  
Real estate loans:
                                    
Residential
  
$
3,142
    
$
68
    
$
3,210
    
$
342,246
    
$
2,544
    
$
344,790
  
Commercial
    
9,444
      
9
      
9,453
      
1,157,239
      
23,416
      
1,180,655
  
Agricultural
    
4,804
      
-
      
4,804
      
340,336
      
2,151
      
342,487
  
Construction
    
875
      
92
      
967
      
106,315
      
1,552
      
107,867
  
Consumer
    
402
      
923
      
1,325
      
108,463
      
995
      
109,458
  
Other commercial loans
    
2,007
      
424
      
2,431
      
169,246
      
2,099
      
171,345
  
Other agricultural loans
    
125
      
-
      
125
      
26,739
      
403
      
27,142
  
State and political subdivision loans
    
58
      
-
      
58
      
51,644
      
-
      
51,644
  
Unallocated
    
81
      
-
      
81
      
-
      
-
      
-
  
Total
  
$
20,938
    
$
1,516
    
$
22,454
    
$
2,302,228
    
$
33,160
    
$
2,335,388
  
             
December 31, 2024
                                                
Real estate loans:
                                                
Residential
  
$
1,902
    
$
38
    
$
1,940
    
$
349,909
    
$
1,489
    
$
351,398
  
Commercial
    
9,070
      
104
      
9,174
      
1,105,847
      
15,588
      
1,121,435
  
Agricultural
    
3,529
      
-
      
3,529
      
323,660
      
4,062
      
327,722
  
Construction
    
1,402
      
-
      
1,402
      
164,043
      
283
      
164,326
  
Consumer
    
324
      
1,014
      
1,338
      
108,478
      
1,027
      
109,505
  
Other commercial loans
    
3,019
      
747
      
3,766
      
152,430
      
2,582
      
155,012
  
Other agricultural loans
    
133
      
-
      
133
      
29,125
      
537
      
29,662
  
State and political subdivision loans
    
61
      
-
      
61
      
54,182
      
-
      
54,182
  
Unallocated
    
356
      
-
      
356
      
-
      
-
      
-
  
Total
  
$
19,796
    
$
1,903
    
$
21,699
    
$
2,287,674
    
$
25,568
    
$
2,313,242
  

Non-performing Loans

Non-performing loans include those loans that are considered nonaccrual, described in more detail below, and all loans past due 90 or more days. Loans are considered for non-accrual status upon reaching 90 days delinquency, although the Company may be receiving partial payments of interest and partial repayments of principal on such loans, or if full payment of principal and interest is not expected. Additionally, if management is made aware of other information including bankruptcy, repossession, death, or legal proceedings, the loan may be placed on non-accrual status. If a loan is 90 days or more past due and is well secured and in the process of collection, it may still be considered accruing.

The following table reflects the non-performing loan receivables, as well as those on non-accrual status as of September 30, 2025 and December 31, 2024, respectively. The balances are presented by class of loan receivable (in thousands):

   
September 30, 2025
    
December 31, 2024
  
   
Nonaccrual
With a
related
allowance
    
Nonaccrual
Without a
related
allowance
    
90 days or
greater
past due
and
accruing
    
Total non-
performing
loans
    
Nonaccrual
With a
related
allowance
    
Nonaccrual
Without a
related
allowance
    
90 days or
greater
past due
 and
accruing
    
Total non-
performing
loans
  
Real estate loans:
                                                
Mortgages
  
$
450
    
$
3,511
    
$
-
    
$
3,961
    
$
165
    
$
2,541
    
$
-
    
$
2,706
  
Home Equity
    
-
      
62
      
3
      
65
      
-
      
165
      
-
      
165
  
Commercial
    
109
      
9,402
      
3
      
9,514
      
2,099
      
12,265
      
-
      
14,364
  
Agricultural
    
-
      
2,151
      
-
      
2,151
      
-
      
4,062
      
269
      
4,331
  
Construction
    
239
      
1,313
      
-
      
1,552
      
-
      
283
      
-
      
283
  
Consumer
    
778
      
-
      
14
      
792
      
1,002
      
-
      
7
      
1,009
  
Other commercial loans
    
558
      
1,548
      
17
      
2,123
      
2,382
      
200
      
-
      
2,582
  
Other agricultural loans
    
-
      
403
      
-
      
403
      
-
      
537
      
-
      
537
  

 
$
2,134
    
$
18,390
    
$
37
    
$
20,561
    
$
5,648
    
$
20,053
    
$
276
    
$
25,977
  
As of September 30, 2025, there were $18.4 million of non-accrual loans that did not have a related allowance for credit losses. The estimated fair values of the collateral securing these loans exceeded their carrying amount, or the loans were previously charged down to the realizable collateral values. Accordingly, no specific valuation allowance was considered to be necessary.

The following table presents, by class of loans receivable, the amortized cost basis of collateral-dependent nonaccrual loans and type of collateral as of September 30, 2025 and December 31, 2024 (in thousands):

September 30, 2025
  
Real Estate
    
Business Assets
    
None
    
Total
  
Real estate loans:
                        
Mortgages
  
$
3,961
    
$
-
    
$
-
    
$
3,961
  
Home Equity
    
62
      
-
      
-
      
62
  
Commercial
    
9,511
      
-
      
-
      
9,511
  
Agricultural
    
2,151
      
-
      
-
      
2,151
  
Construction
    
1,552
      
-
      
-
      
1,552
  
Consumer
    
-
      
-
      
778
      
778
  
Other commercial loans
    
-
      
2,106
      
-
      
2,106
  
Other agricultural loans
    
-
      
403
      
-
      
403
  
   
$
17,237
    
$
2,509
    
$
778
    
$
20,524
  

December 31, 2024
  
Real Estate
    
Business Assets
    
None
    
Total
  
Real estate loans:
                                
Mortgages
  
$
2,706
    
$
-
    
$
-
    
$
2,706
  
Home Equity
    
165
      
-
      
-
      
165
  
Commercial
    
14,364
      
-
      
-
      
14,364
  
Agricultural
    
4,062
      
-
      
-
      
4,062
  
Construction
    
283
      
-
      
-
      
283
  
Consumer
    
-
      
-
      
1,002
      
1,002
  
Other commercial loans
    
-
      
2,582
      
-
      
2,582
  
Other agricultural loans
    
-
      
537
      
-
      
537
  
   
$
21,580
    
$
3,119
    
$
1,002
    
$
25,701
  

Credit Quality Information

For commercial real estate loans, agricultural real estate loans, construction loans, other commercial loans, other agricultural loans, and state and political subdivision loans, management uses a ten grade internal risk rating system to monitor and assess credit quality. The first six grades under the revised system are considered not criticized and are aggregated as “Pass” rated. The criticized rating categories utilized by management generally follow bank regulatory definitions. The definitions of each rating are defined below:
 

 •
Pass (Grades 1-6) – These loans are to customers with credit quality ranging from an acceptable to very high quality and are protected by the current net worth and paying capacity of the obligor or by the value of the underlying collateral.
 

 •
Special Mention (Grade 7) – This loan grade is in accordance with regulatory guidance and includes loans where a potential weakness or risk exists, which could cause a more serious problem if not corrected.
 

 •
Substandard (Grade 8) – This loan grade is in accordance with regulatory guidance and includes loans that have a well-defined weakness based on objective evidence and are characterized by the distinct possibility that the Bank will sustain some loss if the deficiencies are not corrected.
 

 •
Doubtful (Grade 9) – This loan grade is in accordance with regulatory guidance and includes loans that have all the weaknesses inherent in a substandard asset. In addition, these weaknesses make collection or liquidation in full highly questionable and improbable, based on existing circumstances.

•
Loss (Grade 10) – This loan grade is in accordance with regulatory guidance and includes loans that are considered uncollectible, or of such value that continuance as an asset is not warranted.

To help ensure that risk ratings are accurate and reflect the present and future capacity of borrowers to repay the loan as agreed, the Company’s loan rating process includes several layers of internal and external oversight. The Company’s loan officers are responsible for the timely and accurate risk rating of the loans in each of their portfolios at origination and on an ongoing basis under the supervision of management.  All commercial, agricultural and state and political relationships over $500,000 are reviewed annually to ensure the appropriateness of the loan grade. In addition, the Company engages an external consultant on at least an annual basis to: 1) review a minimum of 50% of the dollar volume of the commercial loan portfolio on an annual basis, 2) a large sample of relationships in aggregate over $1,000,000, 3) selected loan relationships over $750,000 which are over 30 days past due, or classified Special Mention, Substandard, Doubtful, or Loss, and 4) such other loans which management or the consultant deems appropriate.
The following tables represent credit exposures by internally assigned grades, by origination year, as of September 30, 2025 and December 31, 2024 (in thousands):


    
Revolving
    
Revolving
    
 

 
Term Loans Amortized Cost Basis by Origination Year
    
Loans
    
Loans
        

                                     
Amortized
    
Converted
        
September 30, 2025
  
2025
    
2024
    
2023
    
2022
    
2021
    
Prior
    
Cost Basis
    
to Term
    
Total
  
Commercial real estate
                                                      
Risk Rating
                                                      
Pass
  
$
73,928
    
$
64,110
    
$
110,083
    
$
352,232
    
$
172,025
    
$
310,598
    
$
34,042
    
$
1,661
    
$
1,118,679
  
Special Mention
    
-
      
-
      
801
      
5,834
      
9,652
      
7,486
      
735
      
-
      
24,508
  
Substandard
    
-
      
-
      
1,033
      
22,497
      
2,922
      
10,515
      
153
      
348
      
37,468
  
Doubtful
    
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
  
Total
  
$
73,928
    
$
64,110
    
$
111,917
    
$
380,563
    
$
184,599
    
$
328,599
    
$
34,930
    
$
2,009
    
$
1,180,655
  
Current period gross charge-offs
  
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
40
    
$
-
    
$
-
    
$
40
  

                                                                       
Agricultural real estate
                                                                        
Risk Rating
                                                                        
Pass
  
$
42,153
    
$
31,229
    
$
20,155
    
$
49,577
    
$
22,740
    
$
147,094
    
$
12,770
    
$
202
    
$
325,920
  
Special Mention
    
86
      
41
      
3,305
      
582
      
354
      
1,331
      
1,558
      
-
      
7,257
  
Substandard
    
664
      
676
      
-
      
2,054
      
672
      
4,520
      
646
      
78
      
9,310
  
Doubtful
    
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
  
Total
  
$
42,903
    
$
31,946
    
$
23,460
    
$
52,213
    
$
23,766
    
$
152,945
    
$
14,974
    
$
280
    
$
342,487
  
Current period gross charge-offs
  
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
  
                                                                         
Construction
                                    

                                 
Risk Rating
                                                                        
Pass
  
$
17,128
    
$
18,978
    
$
29,832
    
$
27,144
    
$
-
    
$
-
    
$
5,043
    
$
-
    
$
98,125
  
Special Mention
    
-
      
-
      
-
      
207
      
2,945
      
-
      
-
      
-
      
3,152
  
Substandard
    
-
      
-
      
789
      
5,518
      
283
      
-
      
-
      
-
      
6,590
  
Doubtful
    
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
  
Total
  
$
17,128
    
$
18,978
    
$
30,621
    
$
32,869
    
$
3,228
    
$
-
    
$
5,043
    
$
-
    
$
107,867
  
Current period gross charge-offs
  
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
  

                                                                       
Other commercial loans
                                    

                                 
Risk Rating
                                                                        
Pass
  
$
23,614
    
$
28,770
    
$
18,772
    
$
5,306
    
$
6,085
    
$
4,220
    
$
75,561
    
$
76
    
$
162,404
  
Special Mention
    
-
      
-
      
-
      
1,802
      
5
      
-
      
4,139
      
-
      
5,946
  
Substandard
    
-
      
129
      
-
      
-
      
39
      
727
      
363
      
1,622
      
2,880
  
Doubtful
    
-
      
-
      
-
      
-
      
-
      
-
      
108
      
7
      
115
  
Total
  
$
23,614
    
$
28,899
    
$
18,772
    
$
7,108
    
$
6,129
    
$
4,947
    
$
80,171
    
$
1,705
    
$
171,345
  
Current period gross charge-offs
  
$
-
    
$
49
    
$
-
    
$
-
    
$
-
    
$
63
    
$
342
    
$
-
    
$
454
  

                                                                       
Other agricultural loans
                                    

                                 
Risk Rating
                                                                        
Pass
  
$
5,368
    
$
3,817
    
$
1,554
    
$
532
    
$
2,137
    
$
345
    
$
11,109
    
$
-
    
$
24,862
  
Special Mention
    
-
      
947
      
17
      
-
      
-
      
-
      
288
      
-
      
1,252
  
Substandard
    
-
      
-
      
297
      
444
      
-
      
57
      
230
      
-
      
1,028
  
Doubtful
    
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
  
Total
  
$
5,368
    
$
4,764
    
$
1,868
    
$
976
    
$
2,137
    
$
402
    
$
11,627
    
$
-
    
$
27,142
  
Current period gross charge-offs
  
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
  

                                                                       
State and political subdivision loans
                                    

                                 
Risk Rating
                                                                        
Pass
  
$
58
    
$
28
    
$
1,309
    
$
12,775
    
$
10,076
    
$
27,072
    
$
326
    
$
-
    
$
51,644
  
Special Mention
    
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
  
Substandard
    
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
  
Doubtful
    
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
  
Total
  
$
58
    
$
28
    
$
1,309
    
$
12,775
    
$
10,076
    
$
27,072
    
$
326
    
$
-
    
$
51,644
  
Current period gross charge-offs
  
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
  

                                                                       
Total
                                    

                                 
Risk Rating
                                                                        
Pass
  
$
162,249
    
$
146,932
    
$
181,705
    
$
447,566
    
$
213,063
    
$
489,329
    
$
138,851
    
$
1,939
    
$
1,781,634
  
Special Mention
    
86
      
988
      
4,123
      
8,425
      
12,956
      
8,817
      
6,720
      
-
      
42,115
  
Substandard
    
664
      
805
      
2,119
      
30,513
      
3,916
      
15,819
      
1,392
      
2,048
      
57,276
  
Doubtful
    
-
      
-
      
-
      
-
      
-
      
-
      
108
      
7
      
115
  
Total
  
$
162,999
    
$
148,725
    
$
187,947
    
$
486,504
    
$
229,935
    
$
513,965
    
$
147,071
    
$
3,994
    
$
1,881,140
  

 
   
Revolving
    
Revolving
        

 
Term Loans Amortized Cost Basis by Origination Year
    
Loans
    
Loans
        

                                     
Amortized
    
Converted
        
December 31, 2024
  
2024
    
2023
    
2022
    
2021
    
2020
    
Prior
    
Cost Basis
    
to Term
    
Total
  
Commercial real estate
                                                      
Risk Rating
                                                      
Pass
  
$
52,122
    
$
84,465
    
$
360,989
    
$
200,869
    
$
114,839
    
$
223,601
    
$
28,178
    
$
1,786
    
$
1,066,849
  
Special Mention
    
-
      
810
      
3,495
      
1,874
      
1,372
      
8,501
      
1,674
      
-
      
17,726
  
Substandard
    
85
      
1,057
      
19,884
      
2,843
      
629
      
11,785
      
176
      
401
      
36,860
  
Doubtful
    
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
  
Total
  
$
52,207
    
$
86,332
    
$
384,368
    
$
205,586
    
$
116,840
    
$
243,887
    
$
30,028
    
$
2,187
    
$
1,121,435
  
Current period gross charge-offs
  
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
  

                                                                       
Agricultural real estate
                                                                        
Risk Rating
                                                                        
Pass
  
$
32,199
    
$
22,372
    
$
46,644
    
$
26,132
    
$
29,770
    
$
126,876
    
$
14,351
    
$
115
    
$
298,459
  
Special Mention
    
2,930
      
3,138
      
7,109
      
-
      
-
      
5,315
      
2,248
      
-
      
20,740
  
Substandard
    
708
      
140
      
2,179
      
1,250
      
-
      
3,604
      
529
      
113
      
8,523
  
Doubtful
    
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
  
Total
  
$
35,837
    
$
25,650
    
$
55,932
    
$
27,382
    
$
29,770
    
$
135,795
    
$
17,128
    
$
228
    
$
327,722
  
Current period gross charge-offs
  
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
  

                                                                       
Construction
                                    

                                 
Risk Rating
                                                                        
Pass
  
$
48,026
    
$
56,916
    
$
34,995
    
$
-
    
$
-
    
$
-
    
$
1,355
    
$
-
    
$
141,292
  
Special Mention
    
-
      
-
      
19,391
      
2,950
      
-
      
-
      
-
      
-
      
22,341
  
Substandard
    
-
      
-
      
410
      
283
      
-
      
-
      
-
      
-
      
693
  
Doubtful
    
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
  
Total
  
$
48,026
    
$
56,916
    
$
54,796
    
$
3,233
    
$
-
    
$
-
    
$
1,355
    
$
-
    
$
164,326
  
Current period gross charge-offs
  
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
  

                                                 
Other commercial loans
                                    

                                 
Risk Rating
                                                                        
Pass
  
$
33,211
    
$
22,808
    
$
6,773
    
$
7,542
    
$
2,150
    
$
3,464
    
$
68,573
    
$
75
    
$
144,596
  
Special Mention
    
20
      
-
      
1,798
      
178
      
62
      
56
      
4,888
      
32
      
7,034
  
Substandard
    
213
      
-
      
195
      
-
      
234
      
641
      
422
      
1,661
      
3,366
  
Doubtful
    
-
      
-
      
-
      
-
      
-
      
-
      
-
      
16
      
16
  
Total
  
$
33,444
    
$
22,808
    
$
8,766
    
$
7,720
    
$
2,446
    
$
4,161
    
$
73,883
    
$
1,784
    
$
155,012
  
Current period gross charge-offs
  
$
-
    
$
-
    
$
59
    
$
-
    
$
-
    
$
-
    
$
2,502
    
$
-
    
$
2,561
  

                                                                       
Other agricultural loans
                                    

                                 
Risk Rating
                                                                        
Pass
  
$
4,576
    
$
2,008
    
$
888
    
$
3,870
    
$
407
    
$
220
    
$
14,812
    
$
-
    
$
26,781
  
Special Mention
    
1,341
      
-
      
-
      
-
      
-
      
400
      
67
      
-
      
1,808
  
Substandard
    
-
      
354
      
455
      
9
      
-
      
113
      
131
      
11
      
1,073
  
Doubtful
    
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
  
Total
  
$
5,917
    
$
2,362
    
$
1,343
    
$
3,879
    
$
407
    
$
733
    
$
15,010
    
$
11
    
$
29,662
  
Current period gross charge-offs
  
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
  

                                                                       
State and political subdivision loans
                                    

                                 
Risk Rating
                                                                        
Pass
  
$
-
    
$
1,442
    
$
13,460
    
$
10,522
    
$
5,319
    
$
23,439
    
$
-
    
$
-
    
$
54,182
  
Special Mention
    
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
  
Substandard
    
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
  
Doubtful
    
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
  
Total
  
$
-
    
$
1,442
    
$
13,460
    
$
10,522
    
$
5,319
    
$
23,439
    
$
-
    
$
-
    
$
54,182
  
Current period gross charge-offs
  
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
  

                                                                       
Total
                                    

                                 
Risk Rating
                                                                        
Pass
  
$
170,134
    
$
190,011
    
$
463,749
    
$
248,935
    
$
152,485
    
$
377,600
    
$
127,269
    
$
1,976
    
$
1,732,159
  
Special Mention
    
4,291
      
3,948
      
31,793
      
5,002
      
1,434
      
14,272
      
8,877
      
32
      
69,649
  
Substandard
    
1,006
      
1,551
      
23,123
      
4,385
      
863
      
16,143
      
1,258
      
2,186
      
50,515
  
Doubtful
    
-
      
-
      
-
      
-
      
-
      
-
      
-
      
16
      
16
  
Total
  
$
175,431
    
$
195,510
    
$
518,665
    
$
258,322
    
$
154,782
    
$
408,015
    
$
137,404
    
$
4,210
    
$
1,852,339
  
For residential real estate mortgage loans, home equity loans, 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 above, and all loans past due 90 or more days and still accruing. The following tables present the recorded investment in those loan classes based on payment activity, by origination year, as of September 30, 2025 and December 31, 2024 (in thousands):


    
Revolving
    
Revolving
        

 
Term Loans Amortized Cost Basis by Origination Year
    
Loans
    
Loans
        

                                     
Amortized
    
Converted
        
September 30, 2025
  
2025
    
2024
    
2023
    
2022
    
2021
    
Prior
    
Cost Basis
    
to Term
    
Total
  
Residential real estate
                                                      
Payment Performance
                                                      
Performing
  
$
10,591
    
$
13,285
    
$
23,832
    
$
83,437
    
$
42,591
    
$
115,668
    
$
-
    
$
-
    
$
289,404
  
Nonperforming
    
-
      
-
      
-
      
1,200
      
1,150
      
1,611
      
-
      
-
      
3,961
  
Total  
$
10,591
    
$
13,285
    
$
23,832
    
$
84,637
    
$
43,741
    
$
117,279
    
$
-
    
$
-
    
$
293,365
  
Current period gross charge-offs
  
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
  
Home equity
                                    

                                 
Payment Performance
                                                                        
Performing
  
$
2,713
    
$
2,757
    
$
2,686
    
$
1,896
    
$
1,204
    
$
7,630
    
$
32,178
    
$
296
    
$
51,360
  
Nonperforming
    
-
      
-
      
-
      
-
      
3
      
62
      
-
      
-
      
65
  
Total  
$
2,713
    
$
2,757
    
$
2,686
    
$
1,896
    
$
1,207
    
$
7,692
    
$
32,178
    
$
296
    
$
51,425
  
Current period gross charge-offs
  
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
  

                                                                       
Consumer
                                    

                                 
Payment Performance
                                                                        
Performing
  
$
2,216
    
$
1,209
    
$
511
    
$
388
    
$
425
    
$
2,698
    
$
101,218
    
$
1
    
$
108,666
  
Nonperforming
    
-
      
-
      
2
      
-
      
11
      
779
      
-
      
-
      
792
  
Total  
$
2,216
    
$
1,209
    
$
513
    
$
388
    
$
436
    
$
3,477
    
$
101,218
    
$
1
    
$
109,458
  
Current period gross charge-offs
  
$
-
    
$
-
    
$
9
    
$
1
    
$
-
    
$
275
    
$
22
    
$
-
    
$
307
  

                                                                       
Total                                    

                                 
Payment Performance
                                                                        
Performing
  
$
15,520
    
$
17,251
    
$
27,029
    
$
85,721
    
$
44,220
    
$
125,997
    
$
133,396
    
$
297
    
$
449,431
  
Nonperforming
    
-
      
-
      
2
      
1,200
      
1,164
      
2,451
      
-
      
-
      
4,817
  
Total  
$
15,520
    
$
17,251
    
$
27,031
    
$
86,921
    
$
45,384
    
$
128,448
    
$
133,396
    
$
297
    
$
454,248
  
         
Revolving
    
Revolving
        
   
Term Loans Amortized Cost Basis by Origination Year
    
Loans
    
Loans
        
                                       
Amortized
    
Converted
        
December 31, 2024
  
2024
    
2023
    
2022
    
2021
    
2020
    
Prior
    
Cost Basis
    
to Term
    
Total
  
Residential real estate
                                                      
Payment Performance
                                                      
Performing
  
$
11,487
    
$
23,870
    
$
88,581
    
$
45,731
    
$
27,537
    
$
101,823
    
$
-
    
$
-
    
$
299,029
  
Nonperforming
    
-
      
-
      
382
      
751
      
463
      
1,110
      
-
      
-
      
2,706
  
Total  
$
11,487
    
$
23,870
    
$
88,963
    
$
46,482
    
$
28,000
    
$
102,933
    
$
-
    
$
-
    
$
301,735
  
Current period gross charge-offs
  
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
5
    
$
-
    
$
-
    
$
5
  
Home equity
                                    

                                 
Payment Performance
                                                                        
Performing
  
$
2,987
    
$
3,456
    
$
2,418
    
$
1,454
    
$
1,525
    
$
7,937
    
$
29,302
    
$
419
    
$
49,498
  
Nonperforming
    
-
      
-
      
-
      
-
      
83
      
82
      
-
      
-
      
165
  
Total  
$
2,987
    
$
3,456
    
$
2,418
    
$
1,454
    
$
1,608
    
$
8,019
    
$
29,302
    
$
419
    
$
49,663
  
Current period gross charge-offs
  
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
  

                                                                       
Consumer
                                    

                                 
Payment Performance
                                                                        
Performing
  
$
2,076
    
$
880
    
$
589
    
$
543
    
$
317
    
$
2,520
    
$
101,570
    
$
1
    
$
108,496
  
Nonperforming
    
-
      
7
      
-
      
-
      
6
      
996
      
-
      
-
      
1,009
  
Total  
$
2,076
    
$
887
    
$
589
    
$
543
    
$
323
    
$
3,516
    
$
101,570
    
$
1
    
$
109,505
  
Current period gross charge-offs
  
$
-
    
$
13
    
$
27
    
$
-
    
$
-
    
$
38
    
$
29
    
$
-
    
$
107
  
                                                                         
Total                                    

                                 
Payment Performance
                                                                        
Performing
  
$
16,550
    
$
28,206
    
$
91,588
    
$
47,728
    
$
29,379
    
$
112,280
    
$
130,872
    
$
420
    
$
457,023
  
Nonperforming
    
-
      
7
      
382
      
751
      
552
      
2,188
      
-
      
-
      
3,880
  
Total  
$
16,550
    
$
28,213
    
$
91,970
    
$
48,479
    
$
29,931
    
$
114,468
    
$
154,574
    
$
420
    
$
460,903
  

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 loan receivables as of September 30, 2025 and December 31, 2024 (in thousands):

                                 
Total
  
   
30-59 Days
    
60-89 Days
    
90 Days
    
Total Past
          
Loans
  
September 30, 2025
  
Past Due
    
Past Due
    
Or Greater
    
Due
    
Current
    
Receivables
  
Real estate loans:
                                    
Mortgages
  
$
1,831
    
$
866
    
$
1,722
    
$
4,419
    
$
288,946
    
$
293,365
  
Home Equity
    
293
      
86
      
33
      
412
      
51,013
      
51,425
  
Commercial
    
2,660
      
384
      
7,411
      
10,455
      
1,170,200
      
1,180,655
  
Agricultural
    
1,206
      
225
      
1,927
      
3,358
      
339,129
      
342,487
  
Construction
    
239
      
-
      
283
      
522
      
107,345
      
107,867
  
Consumer
    
242
      
239
      
792
      
1,273
      
108,185
      
109,458
  
Other commercial loans
    
5,848
      
184
      
1,816
      
7,848
      
163,497
      
171,345
  
Other agricultural loans
    
-
      
5
      
403
      
408
      
26,734
      
27,142
  
State and political subdivision loans
    
-
      
-
      
-
      
-
      
51,644
      
51,644
  
Total
  
$
12,319
    
$
1,989
    
$
14,387
    
$
28,695
    
$
2,306,693
    
$
2,335,388
  
                                                 
Loans considered non-accrual
  
$
797
    
$
283
    
$
14,350
    
$
15,430
    
$
5,093
    
$
20,523
  
Loans still accruing
    
11,522
      
1,706
      
37
      
13,265
      
2,301,600
      
2,314,865
  
Total
  
$
12,319
    
$
1,989
    
$
14,387
    
$
28,695
    
$
2,306,693
    
$
2,335,388
  

                               
Total
  

 
30-59 Days
    
60-89 Days
    
90 Days
    
Total Past
          
Loans
  
December 31, 2024
  
Past Due
    
Past Due
    
Or Greater
    
Due
    
Current
    
Receivables
  
Real estate loans:
                                    
Mortgages
  
$
1,464
    
$
227
    
$
1,605
    
$
3,296
    
$
298,439
    
$
301,735
  
Home Equity
    
138
      
170
      
148
      
456
      
49,207
      
49,663
  
Commercial
    
2,782
      
1,360
      
6,528
      
10,670
      
1,110,765
      
1,121,435
  
Agricultural
    
1,569
      
140
      
1,845
      
3,554
      
324,168
      
327,722
  
Construction
    
1,119
      
-
      
283
      
1,402
      
162,924
      
164,326
  
Consumer
    
292
      
20
      
1,009
      
1,321
      
108,184
      
109,505
  
Other commercial loans
    
478
      
282
      
2,336
      
3,096
      
151,916
      
155,012
  
Other agricultural loans
    
403
      
-
      
-
      
403
      
29,259
      
29,662
  
State and political subdivision loans
    
-
      
-
      
-
      
-
      
54,182
      
54,182
  
Total
  
$
8,245
    
$
2,199
    
$
13,754
    
$
24,198
    
$
2,289,044
    
$
2,313,242
  
                                                 
Loans considered non-accrual
  
$
2,428
    
$
-
    
$
13,478
    
$
15,906
    
$
9,795
    
$
25,701
  
Loans still accruing
    
5,817
      
2,199
      
276
      
8,292
      
2,279,249
      
2,287,541
  
Total
  
$
8,245
    
$
2,199
    
$
13,754
    
$
24,198
    
$
2,289,044
    
$
2,313,242
  

Modifications to Borrowers Experiencing Financial Difficulty

Occasionally, the Company modifies loans to borrowers in financial distress by providing principal forgiveness, term extension, an other-than-insignificant payment delay or interest rate reduction. When principal forgiveness is provided, the amount of forgiveness is charged-off against the allowance for credit losses.

In some cases, the Company provides multiple types of concessions on one loan. Typically, one type of concession, such as a term extension, is granted initially. If the borrower continues to experience financial difficulty, another concession, such as principal forgiveness, may be granted.

The following table shows the amortized cost basis by class of loans receivable, information regarding nonaccrual modified loans to borrowers experiencing financial difficulty during the three and nine months ended September 30, 2025 (dollars in thousands). There were no loan modifications made during the three and nine months ended September 30, 2024, for borrowers experiencing financial difficulty.

Loan Modifications Made to Borrowers Experiencing Financial Difficulty
  
   
Three months ended September 30, 2025
  
   
Number of loans
    
Amortized Cost Basis
    
% of Total Class of Financing Receivable
  
Accruing Modified Loans to Borrowers Experiencing Financial Difficulty
  
Real estate loans:
              
Commercial
    
7
    
$
13,905
      
1.18
%
Total
    
7
    
$
13,905
          

Loan Modifications Made to Borrowers Experiencing Financial Difficulty
  
   
Nine months ended September 30, 2025
  
   
Number of loans
    
Amortized Cost Basis
    
% of Total Class of Financing Receivable
  
Accruing Modified Loans to Borrowers Experiencing Financial Difficulty
  
Real estate loans:
              
Mortgages
    
1
    
$
109
      
0.04
%
Commercial
    
7
      
13,905
      
1.18
%
Other commercial loans
    
1
      
179
      
0.10
%
Total
    
9
    
$
14,193
          
                         
Non-Accruing Modified Loans to Borrowers Experiencing Financial Difficulty
  
Real estate loans:
                  
Commercial
    
3
    
$
1,039
      
0.09
%
Total
    
3
    
$
1,039
          
The following table shows, by class of loans receivable, information regarding the financial effect on nonaccrual modified loans to borrowers experiencing financial difficulty during the three and nine months ended September 30, 2025:

Three months ended September 30, 2025
Term Extension
           
Loan Type
  
Number of loans
  
Financial Effect
Accruing Modified Loans to Borrowers Experiencing Financial Difficulty
    
Real estate loans:
         
Commercial
    
7
  
Extended the loan maturity one year
Total
    
7
    

Nine months ended September 30, 2025
Term Extension

Loan Type
  
Number of loans
  
Financial Effect
Accruing Modified Loans to Borrowers Experiencing Financial Difficulty
  
Real estate loans:
  
    
Mortgages
  
1
  
Extended the loan maturity 5 years with a 30 year amortization
Commercial
  
7
  
Extended the loan maturity one year
Other commercial loans
  
1
  
Extended the loan maturity 10 years as termed out or line of credit
Total
  
9
  

 
       
Non-Accruing Modified Loans to Borrowers Experiencing Financial Difficulty
  
Real estate loans:
          
Commercial
    
3
  
Extended the loan maturity 5 years with a 30 year amortization
Total
    
3
    

There were no accrual or nonaccrual modified loans to borrowers experiencing financial difficulty for which there were payment defaults after the modification date for the three and nine months ended September 30, 2025.

The following presents, by class of loans, the amortized cost and payment status of accruing and nonaccrual modified loans to borrowers experiencing financial difficulty at September 30, 2025 (in thousands):

   
September 30, 2025
  
         
30-89 Days
    
90 Days
        
Accruing Modified Loans to Borrowers Experiencing Financial Difficulty
  
Current
    
Past Due
    
Or Greater
    
Total
  
Real estate loans:
                        
Mortgages
  
$
109
    
$
-
    
$
-
    
$
109
  
Commercial
    
13,905
      
-
      
-
      
13,905
  
Other commercial loans
    
179
      
-
      
-
      
179
  
Total
  
$
14,193
    
$
-
    
$
-
    
$
14,193
  

   
September 30, 2025
  
         
30-89 Days
    
90 Days
        
Non-accruing Modified Loans to Borrowers Experiencing Financial Difficulty
  
Current
    
Past Due
    
Or Greater
    
Total
  
Real estate loans:
                        
Commercial
  
$
1,039
    
$
-
    
$
-
    
$
1,039
  
Total
  
$
1,039
    
$
-
    
$
-
    
$
1,039
  

Foreclosed Assets Held For Sale

Foreclosed assets acquired in settlement of loans are carried at fair value, less estimated costs to sell, and are included in other assets on the Consolidated Balance Sheet. As of September 30, 2025 and December 31, 2024, included within other assets are $2,434,000 and $2,635,000, respectively, of foreclosed assets. As of September 30, 2025, included within the foreclosed assets are $76,000 of consumer residential mortgages that were foreclosed on or received via a deed in lieu of foreclosure transaction prior to the period end. As of September 30, 2025, the Company had initiated formal foreclosure proceedings on $797,000 of residential mortgage loans, the collateral properties of which have not yet been transferred into foreclosed assets.