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COVID-19 | 3 Months Ended
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Mar. 31, 2021
COVID-19 [Abstract] |
COVID-19 | Note 3 – COVID-19 The COVID-19 pandemic has adversely impacted our business and financial results and that of many of our customers, and the ultimate impact will depend on future developments, which are highly uncertain, cannot be predicted, and are largely outside of our control, including the scope and duration of the pandemic and actions taken by governmental authorities in response to the pandemic. The COVID-19 pandemic has created extensive disruptions to the global and U.S. economies and to the lives of individuals throughout the world. Governments, businesses, and the public are taking unprecedented actions to contain the spread of COVID-19 and to mitigate its effects, including closures of businesses and schools, fiscal and monetary stimulus, and legislation designed to deliver financial aid and other relief. While the scope, duration, and full effects of COVID-19 are not fully known, the pandemic and the efforts to contain it have disrupted global economic activity, adversely affected the functioning of financial markets, impacted market interest rates, increased economic and market uncertainty, and disrupted trade and supply chains. Congress, the President, and the Board of Governors of the Federal Reserve System (the “Federal Reserve”) have taken several actions designed to cushion the economic fallout. Most notably, the Coronavirus Aid, Relief and Economic Security Act (the “CARES Act”), a $2 trillion legislative package, was signed into law at the end of March 2020. The goal of the CARES Act is to prevent a severe economic downturn through various measures, including direct financial aid to American families and economic stimulus to significantly impacted industry sectors. Section 4013 of the CARES Act, “Temporary Relief from Troubled Debt Restructurings,” provides banks the option to temporarily suspend certain requirements under U.S. GAAP related to trouble debt restructurings (TDR) for a limited period of time to account for the effects of COVID-19. Additionally, the Economic Aid to Hard-Hit Small Businesses, Nonprofits, and Venues Act was enacted on December 27, 2020, providing for a second round of PPP loans (“PPP-2”). Also, the Consolidated Appropriations Act (CAA) passed on December 27, 2020. Section 541 of the CAA extends the provisions in Section 4013 of the CARES Act to January 1, 2022. The Federal Reserve also took actions to mitigate the economic impact of the COVID-19 pandemic, including cutting the federal funds rate 150 basis points and targeting a 0 to 25 basis point rate. In addition to the general impact of the COVID-19 pandemic, certain provisions of the CARES Act as well as other legislative and regulatory relief efforts are expected to have a material impact on the Company’s operations. The Economic Aid to Hard-Hit Small Businesses, Nonprofits and Venues Act (the Economic Aid Act) amended the PPP by extending the authority of the SBA to guarantee loans and the ability of PPP lenders to disburse PPP loans until March 31, 2021. The PPP Extension Act of 2021, which was enacted on March 30, 2021, extends the PPP application deadline to May 31, 2021 and provides the SBA additional time to process applications through June 30, 2021.” During the first quarter of 2021, we continued to assist our business customers with the Paycheck Protection Program (“PPP”) loan forgiveness process, as well as originating additional PPP loans. We continued to be diligent in protecting our associates and customers from the effects of the pandemic, delaying opening our lobbies until the first of April, as we allowed time for more of our communities to be vaccinated. Most of our sales and support employees continued to work remotely as we continue to monitor our market areas, maintaining travel protocols and utilizing safety precautions while continuing to provide full banking services to our customers. Paycheck Protection Program The Company continues to actively participate in the SBA’s PPP program. On January 19, 2021, the Small Business Administration (the “SBA”) implemented an additional PPP loan program. The Company originated $59.8 million in loans during the first quarter of 2021 related to this new program, consisting of 675 loans with an average loan size of $89 thousand. An additional 149 loans, totaling $5.3 million, were funded through April 24, 2021. During the second and third quarters of 2020, a total of $148.5 million in PPP loans were originated under the initial program, consisting of 1,174 loans with an average loan size of $162 thousand, with $34.5 million, or 290 loans, forgiven in 2020, resulting in a remaining balance at December 31, 2020 of $114.0 million. During the first quarter of 2021, a total of 389 loans, with an aggregate principal balance of $28.7 million, were forgiven, resulting in a remaining balance of $85.3 million at March 31, 2021. An additional 136 loans, with an aggregate principal balance of $15.6 million, were forgiven through April 24, 2021. Of the 1,174 loans originated in 2020, 815 have been forgiven totaling $78.8 million through April 24, 2021, representing 69.4% of the number of 2020 loans originated and 53.1% of 2020 originated principal balances. COVID Modifications While the COVID-19 pandemic has had an impact on most industries, some have been more affected than others. In accordance with Section 4013 of the Coronavirus Aid, Relief, and Economic Security Act and related regulatory pronouncements, we have not accounted for modifications of loans affected by the pandemic as troubled debt restructurings (“TDRs”) nor have we designated them as past due or nonaccrual. As of April 24, 2021, there were 12 loans totaling $5.7 million in total loan modifications, comprised of five commercial loans totaling $5.0 million; three mortgage loans totaling $0.5 million; and four consumer loans totaling $0.2 million. Two commercial loans in the hospitality sector represent the majority of the commercial loan modifications.

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