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Loans
 6 Months Ended
Jun. 30, 2026
Loans [Abstract]  
Loans
Note 5 – Loans

The Company originates commercial, industrial, agricultural, residential, and consumer loans primarily to customers throughout north central, central, south central and south eastern  Pennsylvania, southern New York, Wilmington, Dover and Georgetown, Delaware and Burlington County, New Jersey. Although the Company had a diversified loan portfolio at June 30, 2026 and December 31, 2025, 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 June 30, 2026 and December 31, 2025 (in thousands):
   
June 30, 2026
    
December 31, 2025
  
Real estate loans:
            
Residential
  
$
337,628
    
$
340,972
  
Commercial
    
1,267,682
      
1,218,514
  
Agricultural
    
357,643
      
347,448
  
Construction
    
93,241
      
93,965
  
Consumer
    
39,623
      
88,210
  
Other commercial loans
    
180,997
      
179,166
  
Other agricultural loans
    
29,746
      
30,247
  
State and political subdivision loans
    
88,468
      
52,100
  
Total
    
2,395,028
      
2,350,622
  
Allowance for credit losses - loans
    
(23,559
)
    
(22,806
)
Net loans
  
$
2,371,469
    
$
2,327,816
  

Allowance for Credit Losses - Loans

The allowance for credit losses related to loans encompasses 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 June 30, 2026 and December 31, 2025 (in thousands):

   
June 30, 2026
    
December 31, 2025
  
Allowance for Credit Losses - Loans
  
$
23,559
    
$
22,806
  
Allowance for Credit Losses - Off-Balance Sheet credit Exposure
    
1,441
      
1,163
  
Total allowance for credit losses
  
$
25,000
    
$
23,969
  

The following table presents the activity in the allowance for credit losses for the three and six months ended June 30, 2026 and 2025 (in thousands):

   
Allowance for Credit
Losses - Loans
    
Allowance for Credit
Losses - Off-Balance
Sheet credit Exposure
    
Total
  
Balance at March 31, 2026
  
$
22,894
    
$
1,519
    
$
24,413
  
Loans charged-off
    
(74
)
    
-
      
(74
)
Recoveries of loans previously charged-off
    
161
      
-
      
161
  
Net loans recovered
    
87
      
-
      
87
  
Provision for credit losses
    
578
      
(78
)
    
500
  
Balance at June 30, 2026
  
$
23,559
    
$
1,441
    
$
25,000
  
                         
Balance at December 31, 2025
  
$
22,806
    
$
1,163
    
$
23,969
  
Loans charged-off
    
(152
)
    
-
      
(152
)
Recoveries of loans previously charged-off
    
183
      
-
      
183
  
Net loans recovered
    
31
      
-
      
31
  
Provision for credit losses
    
722
      
278
      
1,000
  
Balance at June 30, 2026
  
$
23,559
    
$
1,441
    
$
25,000
  
   
Allowance for Credit
Losses - Loans
    
Allowance for Credit
Losses - Off-Balance
Sheet credit Exposure
    
Total
  
Balance at March 31, 2025
  
$
22,081
    
$
763
    
$
22,844
  
Loans charged-off
    
(596
)
    
-
      
(596
)
Recoveries of loans previously charged-off
    
25
      
-
      
25
  
Net loans charged-off
    
(571
)
    
-
      
(571
)
Provision for credit losses
    
599
      
151
      
750
  
Balance at June 30, 2025
  
$
22,109
    
$
914
    
$
23,023
  
                         
Balance at December 31, 2024
  
$
21,699
    
$
676
    
$
22,375
  
Loans charged-off
    
(781
)
    
-
      
(781
)
Recoveries of loans previously charged-off
    
54
      
-
      
54
  
Net loans charged-off
    
(727
)
    
-
      
(727
)
Provision for credit losses
    
1,137
      
238
      
1,375
  
Balance at June 30, 2025
  
$
22,109
    
$
914
    
$
23,023
  

The following tables present the activity in the allowance for credit losses – loans, by portfolio segment, for the three and six months ended June 30, 2026 and 2025 (in thousands):
   
For the three months ended June 30, 2026
  
   
Balance at
March 31, 2026
    
Charge-offs
    
Recoveries
    
Provision
    
Balance at
June 30, 2026
  
Real estate loans:
                              
Residential
  
$
2,741
    
$
-
    
$
-
    
$
(70
)
  
$
2,671
  
Commercial
    
10,605
      
-
      
-
      
401
      
11,006
  
Agricultural
    
4,513
      
-
      
-
      
(102
)
    
4,411
  
Construction
    
802
      
-
      
-
      
111
      
913
  
Consumer
    
1,036
      
(7
)
    
5
      
157
      
1,191
  
Other commercial loans
    
2,815
      
(67
)
    
156
      
133
      
3,037
  
Other agricultural loans
    
223
      
-
      
-
      
(33
)
    
190
  
State and political subdivision loans
    
154
      
-
      
-
      
(48
)
    
106
  
Unallocated
    
5
      
-
      
-
      
29
      
34
  
Total
  
$
22,894
    
$
(74
)
  
$
161
    
$
578
    
$
23,559
  

   
For the six months ended June 30, 2026
  
   
Balance at
December 31, 2025
    
Charge-offs
    
Recoveries
    
Provision
    
Balance at
June 30, 2026
  
Real estate loans:
                              
Residential
  
$
3,112
    
$
-
    
$
12
    
$
(453
)
  
$
2,671
  
Commercial
    
10,017
      
-
      
-
      
989
      
11,006
  
Agricultural
    
4,841
      
-
      
-
      
(430
)
    
4,411
  
Construction
    
916
      
-
      
-
      
(3
)
    
913
  
Consumer
    
1,201
      
(20
)
    
12
      
(2
)
    
1,191
  
Other commercial loans
    
2,534
      
(132
)
    
159
      
476
      
3,037
  
Other agricultural loans
    
115
      
-
      
-
      
75
      
190
  
State and political subdivision loans
    
55
      
-
      
-
      
51
      
106
  
Unallocated
    
15
      
-
      
-
      
19
      
34
  
Total
  
$
22,806
    
$
(152
)
  
$
183
    
$
722
    
$
23,559
  
   
For the three months ended June 30, 2025
  
   
Balance at
March 31, 2025
    
Charge-offs
    
Recoveries
    
Provision
    
Balance at
June 30, 2025
  
Real estate loans:
                              
Residential
  
$
3,213
    
$
-
    
$
-
    
$
(151
)
  
$
3,062
  
Commercial
    
9,237
      
-
      
-
      
661
      
9,898
  
Agricultural
    
4,350
      
-
      
-
      
192
      
4,542
  
Construction
    
1,552
      
-
      
-
      
(279
)
    
1,273
  
Consumer
    
1,360
      
(275
)
    
7
      
27
      
1,119
  
Other commercial loans
    
2,090
      
(321
)
    
18
      
206
      
1,993
  
Other agricultural loans
    
137
      
-
      
-
      
(5
)
    
132
  
State and political subdivision loans
    
57
      
-
      
-
      
(1
)
    
56
  
Unallocated
    
85
      
-
      
-
      
(51
)
    
34
  
Total
  
$
22,081
    
$
(596
)
  
$
25
    
$
599
    
$
22,109
  

   
For the six months ended June 30, 2025
  
   
Balance at
December 31, 2024
    
Charge-offs
    
Recoveries
    
Provision
    
Balance at
June 30, 2025
  
Real estate loans:
                                        
Residential
  
$
1,940
    
$
-
    
$
-
    
$
1,122
    
$
3,062
  
Commercial
    
9,174
      
(40
)
    
-
      
764
      
9,898
  
Agricultural
    
3,529
      
-
      
-
      
1,013
      
4,542
  
Construction
    
1,402
      
-
      
-
      
(129
)
    
1,273
  
Consumer
    
1,338
      
(297
)
    
33
      
45
      
1,119
  
Other commercial loans
    
3,766
      
(444
)
    
21
      
(1,350
)
    
1,993
  
Other agricultural loans
    
133
      
-
      
-
      
(1
)
    
132
  
State and political subdivision loans
    
61
      
-
      
-
      
(5
)
    
56
  
Unallocated
    
356
      
-
      
-
      
(322
)
    
34
  
Total
  
$
21,699
    
$
(781
)
  
$
54
    
$
1,137
    
$
22,109
  

The provision for the three and six months ended June 30, 2026 was driven by changes in economic forecasts and the annual update of the loss driver analysis. This update includes revising prepayment and curtailment speeds as well as the historical loss factor. In addition, loss rates are updated to include the most recent completed year of 2025. The provision for 2026 was also impacted by the Iran conflict as we adjusted qualitative factors due to the impact this conflict is having on gas and diesel prices, as well as fertilizer prices as the spring growing season starts.

The provision for the first six months of 2025 was driven by an increase in the amount of past due loans and the annual update of the loss driver analysis. This update included revising prepayment and curtailment speeds. In addition, loss rates were updated to include the 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 following table presents the allowance for credit losses – loans and amortized cost basis of loans as of June 30, 2026 and December 31, 2025 (in thousands):
   
Allowance for Credit Losses - Loans
    
Loans
  
June 30, 2026
  
Collectively
evaluated
    
Individually
evaluated
    
Total Allowance
for Credit
Losses - Loans
    
Collectively
evaluated
    
Individually
evaluated
    
Total Loans
  
Real estate loans:
                                    
Residential
  
$
2,626
    
$
45
    
$
2,671
    
$
334,391
    
$
3,237
    
$
337,628
  
Commercial
    
10,525
      
481
      
11,006
      
1,242,249
      
25,433
      
1,267,682
  
Agricultural
    
4,411
      
-
      
4,411
      
355,514
      
2,129
      
357,643
  
Construction
    
839
      
74
      
913
      
92,014
      
1,227
      
93,241
  
Consumer
    
173
      
1,018
      
1,191
      
38,596
      
1,027
      
39,623
  
Other commercial loans
    
2,249
      
788
      
3,037
      
172,738
      
8,259
      
180,997
  
Other agricultural loans
    
164
      
26
      
190
      
29,249
      
497
      
29,746
  
State and political subdivision loans
    
106
      
-
      
106
      
88,468
      
-
      
88,468
  
Unallocated
    
34
      
-
      
34
      
-
      
-
      
-
  
Total
  
$
21,127
    
$
2,432
    
$
23,559
    
$
2,353,219
    
$
41,809
    
$
2,395,028
  

December 31, 2025
                                                
Real estate loans:
                                                
Residential
  
$
3,050
    
$
62
    
$
3,112
    
$
338,600
    
$
2,372
    
$
340,972
  
Commercial
    
9,757
      
260
      
10,017
      
1,193,742
      
24,772
      
1,218,514
  
Agricultural
    
4,841
      
-
      
4,841
      
345,302
      
2,146
      
347,448
  
Construction
    
830
      
86
      
916
      
93,450
      
515
      
93,965
  
Consumer
    
327
      
874
      
1,201
      
87,301
      
909
      
88,210
  
Other commercial loans
    
1,903
      
631
      
2,534
      
171,343
      
7,823
      
179,166
  
Other agricultural loans
    
115
      
-
      
115
      
29,844
      
403
      
30,247
  
State and political subdivision loans
    
55
      
-
      
55
      
52,100
      
-
      
52,100
  
Unallocated
    
15
      
-
      
15
      
-
      
-
      
-
  
Total
  
$
20,893
    
$
1,913
    
$
22,806
    
$
2,311,682
    
$
38,940
    
$
2,350,622
  

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 June 30, 2026 and December 31, 2025, respectively. The balances are presented by class of loan receivable (in thousands):

   
June 30, 2026
    
December 31, 2025
  
   
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
  
$
704
    
$
2,994
    
$
-
    
$
3,698
    
$
153
    
$
3,229
    
$
-
    
$
3,382
  
Home Equity
    
-
      
595
      
27
      
622
      
-
      
61
      
151
      
212
  
Commercial
    
5,262
      
17,673
      
392
      
23,327
      
2,860
      
8,637
      
-
      
11,497
  
Agricultural
    
-
      
2,129
      
-
      
2,129
      
-
      
2,145
      
55
      
2,200
  
Construction
    
221
      
1,006
      
-
      
1,227
      
233
      
283
      
-
      
516
  
Consumer
    
1,010
      
-
      
3
      
1,013
      
770
      
-
      
15
      
785
  
Other commercial loans
    
6,815
      
1,443
      
5
      
8,263
      
6,282
      
1,546
      
8
      
7,836
  
Other agricultural loans
    
95
      
403
      
230
      
728
      
-
      
403
      
-
      
403
  
   
$
14,107
    
$
26,243
    
$
657
    
$
41,007
    
$
10,298
    
$
16,304
    
$
229
    
$
26,831
  
As of June 30, 2026, there were $26.2 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 loans and type of collateral as of June 30, 2026 and December 31, 2025 (in thousands):

June 30, 2026
  
Real Estate
    
Business Assets
    
Total
  
Real estate loans:
                  
Mortgages
  
$
3,698
    
$
-
    
$
3,698
  
Home Equity
    
595
      
-
      
595
  
Commercial
    
22,935
      
-
      
22,935
  
Agricultural
    
2,129
      
-
      
2,129
  
Construction
    
1,227
      
-
      
1,227
  
Other commercial loans
    
-
      
8,258
      
8,258
  
Other agricultural loans
    
-
      
498
      
498
  
   
$
30,584
    
$
8,756
    
$
39,340
  

December 31, 2025
                        
Real estate loans:
                        
Mortgages
  
$
3,382
    
$
-
    
$
3,382
  
Home Equity
    
61
      
-
      
61
  
Commercial
    
11,497
      
-
      
11,497
  
Agricultural
    
2,145
      
-
      
2,145
  
Construction
    
516
      
-
      
516
  
Other commercial loans
    
-
      
7,828
      
7,828
  
Other agricultural loans
    
-
      
403
      
403
  
   
$
17,601
    
$
8,231
    
$
25,832
  

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. Commercial, agricultural and state and political relationships over $750,000 in all Bank regions other than the Delaware region are reviewed annually to ensure the appropriateness of the loan grade. In the Delaware region all loan relationships greater than $1,000,000 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 June 30, 2026 and December 31, 2025 (in thousands):
                                       
Revolving
    
Revolving
        
         
Loans
    
Loans
        
                                       
Amortized
    
Converted
        
June 30, 2026
  
2026
    
2025
    
2024
    
2023
    
2022
    
Prior
    
Cost Basis
    
to Term
    
Total
  
Commercial real estate
                                                      
Risk Rating
                                                      
Pass
  
$
102,536
    
$
123,008
    
$
56,644
    
$
112,912
    
$
333,617
    
$
416,470
    
$
38,879
    
$
1,866
    
$
1,185,932
  
Special Mention
    
-
      
-
      
-
      
787
      
13,013
      
23,907
      
-
      
-
      
37,707
  
Substandard
    
-
      
-
      
5,043
      
561
      
23,091
      
12,778
      
2,570
      
-
      
44,043
  
Doubtful
    
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
  
Total
  
$
102,536
    
$
123,008
    
$
61,687
    
$
114,260
    
$
369,721
    
$
453,155
    
$
41,449
    
$
1,866
    
$
1,267,682
  
Current period gross charge-offs
  
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
  
                                                                         
Agricultural real estate
                                                                        
Risk Rating
                                                                        
Pass
  
$
32,792
    
$
54,572
    
$
28,243
    
$
17,808
    
$
42,069
    
$
146,770
    
$
17,994
    
$
130
    
$
340,378
  
Special Mention
    
495
      
-
      
295
      
3,221
      
1,320
      
3,696
      
1,251
      
-
      
10,278
  
Substandard
    
-
      
988
      
630
      
-
      
2,048
      
2,604
      
644
      
73
      
6,987
  
Doubtful
    
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
  
Total
  
$
33,287
    
$
55,560
    
$
29,168
    
$
21,029
    
$
45,437
    
$
153,070
    
$
19,889
    
$
203
    
$
357,643
  
Current period gross charge-offs
  
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
  
                                                                         
Construction
                                    

                                 
Risk Rating
                                                                        
Pass
  
$
35,353
    
$
26,738
    
$
8,520
    
$
3,931
    
$
6,120
    
$
-
    
$
4,055
    
$
-
    
$
84,717
  
Special Mention
    
-
      
-
      
-
      
-
      
202
      
2,928
      
-
      
-
      
3,130
  
Substandard
    
-
      
-
      
-
      
739
      
4,388
      
267
      
-
      
-
      
5,394
  
Doubtful
    
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
  
Total
  
$
35,353
    
$
26,738
    
$
8,520
    
$
4,670
    
$
10,710
    
$
3,195
    
$
4,055
    
$
-
    
$
93,241
  
Current period gross charge-offs
  
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
  
                                                                         
Other commercial loans
                                    

                                 
Risk Rating
                                                                        
Pass
  
$
5,393
    
$
29,028
    
$
23,979
    
$
16,489
    
$
4,315
    
$
6,906
    
$
80,584
    
$
209
    
$
166,903
  
Special Mention
    
-
      
-
      
-
      
-
      
-
      
34
      
5,176
      
-
      
5,210
  
Substandard
    
-
      
-
      
240
      
-
      
3,895
      
753
      
2,553
      
1,443
      
8,884
  
Doubtful
    
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
  
Total
  
$
5,393
    
$
29,028
    
$
24,219
    
$
16,489
    
$
8,210
    
$
7,693
    
$
88,313
    
$
1,652
    
$
180,997
  
Current period gross charge-offs
  
$
-
    
$
-
    
$
1
    
$
-
    
$
-
    
$
30
    
$
101
    
$
-
    
$
132
  
                                                                         
Other agricultural loans
                                    

                                 
Risk Rating
                                                                        
Pass
  
$
7,960
    
$
4,985
    
$
2,124
    
$
1,060
    
$
256
    
$
820
    
$
10,154
    
$
-
    
$
27,359
  
Special Mention
    
-
      
13
      
689
      
9
      
-
      
-
      
747
      
-
      
1,458
  
Substandard
    
-
      
-
      
-
      
272
      
431
      
-
      
226
      
-
      
929
  
Doubtful
    
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
  
Total
  
$
7,960
    
$
4,998
    
$
2,813
    
$
1,341
    
$
687
    
$
820
    
$
11,127
    
$
-
    
$
29,746
  
Current period gross charge-offs
  
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
  
                                                                         
State and political subdivision loans
                                    

                                 
Risk Rating
                                                                        
Pass
  
$
33,064
    
$
6,318
    
$
-
    
$
1,241
    
$
12,646
    
$
34,895
    
$
304
    
$
-
    
$
88,468
  
Special Mention
    
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
  
Substandard
    
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
  
Doubtful
    
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
  
Total
  
$
33,064
    
$
6,318
    
$
-
    
$
1,241
    
$
12,646
    
$
34,895
    
$
304
    
$
-
    
$
88,468
  
Current period gross charge-offs
  
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
  
                                                                         
Total
                                    

                                 
Risk Rating
                                                                        
Pass
  
$
217,098
    
$
244,649
    
$
119,510
    
$
153,441
    
$
399,023
    
$
605,861
    
$
151,970
    
$
2,205
    
$
1,893,757
  
Special Mention
    
495
      
13
      
984
      
4,017
      
14,535
      
30,565
      
7,174
      
-
      
57,783
  
Substandard
    
-
      
988
      
5,913
      
1,572
      
33,853
      
16,402
      
5,993
      
1,516
      
66,237
  
Doubtful
    
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
  
Total
  
$
217,593
    
$
245,650
    
$
126,407
    
$
159,030
    
$
447,411
    
$
652,828
    
$
165,137
    
$
3,721
    
$
2,017,777
  
                                       
Revolving
    
Revolving
        
         
Loans
    
Loans
        
                                       
Amortized
    
Converted
        
December 31, 2025
  
2025
    
2024
    
2023
    
2022
    
2021
    
Prior
    
Cost Basis
    
to Term
    
Total
  
Commercial real estate
                                                      
Risk Rating
                                                      
Pass
  
$
127,490
    
$
59,760
    
$
128,989
    
$
329,694
    
$
172,617
    
$
294,237
    
$
34,709
    
$
1,971
    
$
1,149,467
  
Special Mention
    
-
      
5,042
      
797
      
5,784
      
8,770
      
7,208
      
733
      
-
      
28,334
  
Substandard
    
-
      
-
      
1,021
      
24,582
      
3,024
      
9,772
      
2,314
      
-
      
40,713
  
Doubtful
    
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
  
Total
  
$
127,490
    
$
64,802
    
$
130,807
    
$
360,060
    
$
184,411
    
$
311,217
    
$
37,756
    
$
1,971
    
$
1,218,514
  
Current period gross charge-offs
  
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
40
    
$
-
    
$
-
    
$
40
  
                                                                         
Agricultural real estate
                                                                        
Risk Rating
                                                                        
Pass
  
$
54,278
    
$
30,648
    
$
18,810
    
$
47,254
    
$
20,747
    
$
139,424
    
$
18,558
    
$
131
    
$
329,850
  
Special Mention
    
55
      
40
      
3,276
      
1,384
      
1,731
      
1,893
      
1,723
      
-
      
10,102
  
Substandard
    
1,297
      
667
      
-
      
2,052
      
657
      
2,103
      
645
      
75
      
7,496
  
Doubtful
    
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
  
Total
  
$
55,630
    
$
31,355
    
$
22,086
    
$
50,690
    
$
23,135
    
$
143,420
    
$
20,926
    
$
206
    
$
347,448
  
Current period gross charge-offs
  
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
  
Construction
                                    

                                 
Risk Rating
                                                                        
Pass
  
$
30,394
    
$
15,456
    
$
8,490
    
$
25,772
    
$
-
    
$
-
    
$
5,215
    
$
-
    
$
85,327
  
Special Mention
    
-
      
-
      
-
      
206
      
2,943
      
-
      
-
      
-
      
3,149
  
Substandard
    
-
      
-
      
789
      
4,417
      
283
      
-
      
-
      
-
      
5,489
  
Doubtful
    
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
  
Total
  
$
30,394
    
$
15,456
    
$
9,279
    
$
30,395
    
$
3,226
    
$
-
    
$
5,215
    
$
-
    
$
93,965
  
Current period gross charge-offs
  
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
  
Other commercial loans
                                    

                                 
Risk Rating
                                                                        
Pass
  
$
33,300
    
$
27,244
    
$
18,039
    
$
4,938
    
$
6,098
    
$
3,819
    
$
74,628
    
$
232
    
$
168,298
  
Special Mention
    
-
      
-
      
-
      
-
      
-
      
-
      
2,442
      
-
      
2,442
  
Substandard
    
-
      
117
      
-
      
1,784
      
40
      
714
      
4,257
      
1,443
      
8,355
  
Doubtful
    
-
      
-
      
-
      
-
      
-
      
-
      
66
      
5
      
71
  
Total
  
$
33,300
    
$
27,361
    
$
18,039
    
$
6,722
    
$
6,138
    
$
4,533
    
$
81,393
    
$
1,680
    
$
179,166
  
Current period gross charge-offs
  
$
-
    
$
49
    
$
-
    
$
-
    
$
-
    
$
63
    
$
379
    
$
-
    
$
491
  
Other agricultural loans
                                    

                                 
Risk Rating
                                                                        
Pass
  
$
5,677
    
$
3,520
    
$
1,440
    
$
408
    
$
1,602
    
$
288
    
$
14,761
    
$
-
    
$
27,696
  
Special Mention
    
-
      
936
      
15
      
-
      
-
      
-
      
639
      
-
      
1,590
  
Substandard
    
-
      
-
      
294
      
438
      
-
      
-
      
229
      
-
      
961
  
Doubtful
    
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
  
Total
  
$
5,677
    
$
4,456
    
$
1,749
    
$
846
    
$
1,602
    
$
288
    
$
15,629
    
$
-
    
$
30,247
  
Current period gross charge-offs
  
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
  
State and political subdivision loans
                                    

                                 
Risk Rating
                                                                        
Pass
  
$
1,504
    
$
27
    
$
1,291
    
$
12,737
    
$
9,932
    
$
26,509
    
$
100
    
$
-
    
$
52,100
  
Special Mention
    
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
  
Substandard
    
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
  
Doubtful
    
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
  
Total
  
$
1,504
    
$
27
    
$
1,291
    
$
12,737
    
$
9,932
    
$
26,509
    
$
100
    
$
-
    
$
52,100
  
Current period gross charge-offs
  
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
  
Total
                                    

                                 
Risk Rating
                                                                        
Pass
  
$
252,643
    
$
136,655
    
$
177,059
    
$
420,803
    
$
210,996
    
$
464,277
    
$
147,971
    
$
2,334
    
$
1,812,738
  
Special Mention
    
55
      
6,018
      
4,088
      
7,374
      
13,444
      
9,101
      
5,537
      
-
      
45,617
  
Substandard
    
1,297
      
784
      
2,104
      
33,273
      
4,004
      
12,589
      
7,445
      
1,518
      
63,014
  
Doubtful
    
-
      
-
      
-
      
-
      
-
      
-
      
66
      
5
      
71
  
Total
  
$
253,995
    
$
143,457
    
$
183,251
    
$
461,450
    
$
228,444
    
$
485,967
    
$
161,019
    
$
3,857
    
$
1,921,440
  
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 June 30, 2026 and December 31, 2025 (in thousands):

                                       
Revolving
    
Revolving
        
         
Loans
    
Loans
        
                                       
Amortized
    
Converted
        
June 30, 2026
  
2026
    
2025
    
2024
    
2023
    
2022
    
Prior
    
Cost Basis
    
to Term
    
Total
  
Residential real estate
                                                      
Payment Performance
                                                      
Performing
  
$
5,772
    
$
17,357
    
$
12,864
    
$
21,207
    
$
79,564
    
$
144,928
    
$
-
    
$
-
    
$
281,692
  
Nonperforming
    
-
      
-
      
-
      
-
      
1,289
      
2,409
      
-
      
-
      
3,698
  
Total
  
$
5,772
    
$
17,357
    
$
12,864
    
$
21,207
    
$
80,853
    
$
147,337
    
$
-
    
$
-
    
$
285,390
  
Current period gross charge-offs
  
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
  
                                                                         
Home equity
                                                                        
Payment Performance
                                                                        
Performing
  
$
451
    
$
2,248
    
$
2,040
    
$
2,798
    
$
1,405
    
$
6,995
    
$
35,416
    
$
264
    
$
51,617
  
Nonperforming
    
-
      
58
      
-
      
-
      
-
      
563
      
-
      
-
      
621
  
Total
  
$
451
    
$
2,306
    
$
2,040
    
$
2,798
    
$
1,405
    
$
7,558
    
$
35,416
    
$
264
    
$
52,238
  
Current period gross charge-offs
  
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
  
                                                                         
Consumer
                                                                        
Payment Performance
                                                                        
Performing
  
$
1,288
    
$
1,350
    
$
856
    
$
229
    
$
274
    
$
2,385
    
$
32,228
    
$
-
    
$
38,610
  
Nonperforming
    
-
      
-
      
-
      
3
      
-
      
1,010
      
-
      
-
      
1,013
  
Total
  
$
1,288
    
$
1,350
    
$
856
    
$
232
    
$
274
    
$
3,395
    
$
32,228
    
$
-
    
$
39,623
  
Current period gross charge-offs
  
$
-
    
$
-
    
$
-
    
$
-
    
$
1
    
$
4
    
$
15
    
$
-
    
$
20
  
                                                                         
Total
                                  
$

                                 
Payment Performance
                                                                        
Performing
  
$
7,511
    
$
20,955
    
$
15,760
    
$
24,234
    
$
81,243
    
$
154,308
    
$
67,644
    
$
264
    
$
371,919
  
Nonperforming
    
-
      
58
      
-
      
3
      
1,289
      
3,982
      
-
      
-
      
5,332
  
Total
  
$
7,511
    
$
21,013
    
$
15,760
    
$
24,237
    
$
82,532
    
$
158,290
    
$
67,644
    
$
264
    
$
377,251
  

                                       
Revolving
    
Revolving
        
         
Loans
    
Loans
        
                                       
Amortized
    
Converted
        
December 31, 2025
  
2025
    
2024
    
2023
    
2022
    
2021
    
Prior
    
Cost Basis
    
to Term
    
Total
  
Residential real estate
                                                      
Payment Performance
                                                      
Performing
  
$
13,909
    
$
13,209
    
$
23,135
    
$
81,239
    
$
41,842
    
$
111,948
    
$
-
    
$
-
    
$
285,282
  
Nonperforming
    
-
      
-
      
-
      
1,057
      
1,132
      
1,193
      
-
      
-
      
3,382
  
Total
  
$
13,909
    
$
13,209
    
$
23,135
    
$
82,296
    
$
42,974
    
$
113,141
    
$
-
    
$
-
    
$
288,664
  
Current period gross charge-offs
  
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
  
Home equity
                                                                        
Payment Performance
                                                                        
Performing
  
$
2,854
    
$
2,528
    
$
2,533
    
$
1,727
    
$
1,150
    
$
6,918
    
$
34,100
    
$
286
    
$
52,096
  
Nonperforming
    
63
      
-
      
18
      
-
      
-
      
110
      
21
      
-
      
212
  
Total
  
$
2,917
    
$
2,528
    
$
2,551
    
$
1,727
    
$
1,150
    
$
7,028
    
$
34,121
    
$
286
    
$
52,308
  
Current period gross charge-offs
  
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
    
$
-
  
                                                                         
Consumer
                                                                        
Payment Performance
                                                                        
Performing
  
$
1,934
    
$
1,050
    
$
373
    
$
354
    
$
412
    
$
2,577
    
$
80,725
    
$
-
    
$
87,425
  
Nonperforming
    
-
      
10
      
-
      
-
      
11
      
764
      
-
      
-
      
785
  
Total
  
$
1,934
    
$
1,060
    
$
373
    
$
354
    
$
423
    
$
3,341
    
$
80,725
    
$
-
    
$
88,210
  
Current period gross charge-offs
   $
 -
    $
 -
    $ 11
    $ 1
    $ -
    $ 285
    $ 30
    $ -
    $ 327
 
                                                                         
Total
                                                                        
Payment Performance
                                                                        
Performing
   $
18,697
     $
16,787
     $
26,041
     $
83,320
     $
43,404
     $
121,443
     $
114,825
     $
286
     $
424,803
  
Nonperforming
     63
      10
      18
      1,057
      1,143
      2,067
      21
      -
      4,379
 
Total
   $
18,760
     $
16,797
     $
26,059
     $
84,377
     $
44,547
     $
123,510
     $
114,846
     $
286
     $
429,182
  
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 June 30, 2026 and December 31, 2025 (in thousands):

                                 
Total
  
   
30-59 Days
    
60-89 Days
    
90 Days
    
Total Past
          
Loans
  
June 30, 2026
  
Past Due
    
Past Due
    
Or Greater
    
Due
    
Current
    
Receivables
  
Real estate loans:
                                    
Mortgages
  
$
1,645
    
$
30
    
$
1,340
    
$
3,015
    
$
282,375
    
$
285,390
  
Home Equity
    
209
      
7
      
562
      
778
      
51,460
      
52,238
  
Commercial
    
843
      
4,511
      
21,479
      
26,833
      
1,240,849
      
1,267,682
  
Agricultural
    
910
      
349
      
1,927
      
3,186
      
354,457
      
357,643
  
Construction
    
-
      
-
      
1,227
      
1,227
      
92,014
      
93,241
  
Consumer
    
41
      
206
      
1,013
      
1,260
      
38,363
      
39,623
  
Other commercial loans
    
366
      
8
      
1,851
      
2,225
      
178,772
      
180,997
  
Other agricultural loans
    
252
      
-
      
633
      
885
      
28,861
      
29,746
  
State and political subdivision loans
    
-
      
-
      
-
      
-
      
88,468
      
88,468
  
Total
  
$
4,266
    
$
5,111
    
$
30,032
    
$
39,409
    
$
2,355,619
    
$
2,395,028
  
                                                 
Loans considered non-accrual
  
$
652
    
$
30
    
$
29,375
    
$
30,057
    
$
10,293
    
$
40,350
  
Loans still accruing
    
3,614
      
5,081
      
657
      
9,352
      
2,345,326
      
2,354,678
  
Total
  
$
4,266
    
$
5,111
    
$
30,032
    
$
39,409
    
$
2,355,619
    
$
2,395,028
  

                                             
Total
  
     
30-59 Days
       60-89 Days
     
90 Days
      
Total Past
              
Loans
  
December 31, 2025
    
Past Due
       Past Due
     
Or Greater
      
Due
      
Current
      
Receivables
  
Real estate loans:
                                                
Mortgages
  
$
2,737
    
$
1,073
    
$
1,675
    
$
5,485
    
$
283,179
    
$
288,664
  
Home Equity
    
146
      
17
      
181
      
344
      
51,964
      
52,308
  
Commercial
    
1,733
      
2,695
      
9,871
      
14,299
      
1,204,215
      
1,218,514
  
Agricultural
    
1,020
      
158
      
1,982
      
3,160
      
344,288
      
347,448
  
Construction
    
-
      
233
      
283
      
516
      
93,449
      
93,965
  
Consumer
    
161
      
148
      
785
      
1,094
      
87,116
      
88,210
  
Other commercial loans
    
256
      
49
      
7,500
      
7,805
      
171,361
      
179,166
  
Other agricultural loans
    
17
      
-
      
403
      
420
      
29,827
      
30,247
  
State and political subdivision loans
    
-
      
-
      
-
      
-
      
52,100
      
52,100
  
Total
  
$
6,070
    
$
4,373
    
$
22,680
    
$
33,123
    
$
2,317,499
    
$
2,350,622
  
                                                 
Loans considered non-accrual
  
$
396
    
$
778
    
$
22,451
    
$
23,625
    
$
2,977
    
$
26,602
  
Loans still accruing
    
5,674
      
3,595
      
229
      
9,498
      
2,314,522
      
2,324,020
  
Total
  
$
6,070
    
$
4,373
    
$
22,680
    
$
33,123
    
$
2,317,499
    
$
2,350,622
  

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 accrual and nonaccrual modified loans to borrowers experiencing financial difficulty during the six months ended June 30, 2026 and during the three and six months ended June 30, 2025 (dollars in thousands). There were no financial difficulty modifications during the three months ended June 30, 2026.
Loan Modifications Made to Borrowers Experiencing Financial Difficulty
  
   
Six months ended June 30, 2026
  
   
Number of loans
    
Amortized Cost Basis
    
% of Total Class of Financing Receivable
  
Accruing Modified Loans to Borrowers Experiencing Financial Difficulty
  
Real estate loans:
              
Commercial
    
1
    
$
2,472
      
0.20
%
Total
    
1
    
$
2,472
          
                         
Non-Accruing Modified Loans to Borrowers Experiencing Financial Difficulty
  
Real estate loans:
                  
Commercial
    
1
    
$
216
      
0.02
%
Other commercial loans
    
2
      
6,307
      
3.48
%
Total
    
3
    
$
6,523
          

Loan Modifications Made to Borrowers Experiencing Financial Difficulty
  
   
Three months ended June 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
%
Total
    
1
    
$
109
          
                         
Non-Accruing Modified Loans to Borrowers Experiencing Financial Difficulty
  
Real estate loans:
                  
Commercial
    
3
    
$
1,059
      
0.09
%
Total
    
3
    
$
1,059
          

Loan Modifications Made to Borrowers Experiencing Financial Difficulty
  
   
Six months ended June 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
%
Total
    
1
    
$
109
          
                         
Non-Accruing Modified Loans to Borrowers Experiencing Financial Difficulty
  
Real estate loans:
                  
Commercial
    
3
    
$
1,059
      
0.09
%
Other commercial loans
    
1
      
185
      
0.12
%
Total
    
4
    
$
1,244
          

The following table shows, by class of loans receivable, information regarding the financial effect on accrual and nonaccrual modified loans to borrowers experiencing financial difficulty during the six months ended June 30, 2026 and the three and six months ended June 30, 2025. There were no financial difficulty modifications during the three months ended June 30, 2026.
Six months ended June 30, 2026
    
Term Extension
           
Loan Type
  
Number of loans
  
Financial Effect
Accruing Modified Loans to Borrowers Experiencing Financial Difficulty
    
Real estate loans:
         
Commercial
    
1
  
Extended the term of the loan 6 months
Total
    
1
    
             
Non-Accruing Modified Loans to Borrowers Experiencing Financial Difficulty
    
Real estate loans:
           
Commercial
    
1
  
Extended term to 30 years
Other commercial loans
    
2
  
Extended the term five years
Total
    
3
    

Three months ended June 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
Total
    
1
    
             
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
    

Six months ended June 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
Total
    
1
    
             
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
Other commercial loans
    
1
  
Extended the loan maturity 10 years as termed out or line of credit
Total
    
4
    

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 six months ended June 30, 2026.

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 June 30, 2026 (in thousands):
   
June 30, 2026
  
         
30-89 Days
    
90 Days
        
Accruing Modified Loans to Borrowers Experiencing Financial Difficulty
  
Current
    
Past Due
    
Or Greater
    
Total
  
Real estate loans:
                        
Commercial
  
$
2,472
      
-
      
-
      
2,472
  
Total
  
$
2,472
    
$
-
    
$
-
    
$
2,472
  
                                 
Non-Accruing Modified Loans to Borrowers Experiencing Financial Difficulty
                  
Real estate loans:
                                
Commercial
  
$
216
      
-
      
-
    
$
216
  
Other commercial loans
    
6,307
      
-
      
-
      
6,307
  
Total
  
$
6,523
    
$
-
    
$
-
    
$
6,523
  

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 June 30, 2026 and December 31, 2025, included within other assets are $2,358,000 of foreclosed assets. As of June 30, 2026, there are no consumer residential mortgages included within foreclosed assets. As of June 30, 2026, the Company had initiated formal foreclosure proceedings on $1,443,000 of residential mortgage loans, the collateral properties of which have not yet been transferred into foreclosed assets.