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Loans Receivable and Allowance for Credit Losses | 12 Months Ended
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Dec. 31, 2023
Loans Receivable and Allowance for Credit Losses [Abstract] |
Loans Receivable and Allowance for Credit Losses | NOTE 4 - LOANS RECEIVABLE AND ALLOWANCE FOR CREDIT LOSSES Set forth below is selected data relating to the composition of the loan portfolio (in thousands):
| December 31, 2023 |  |  | December 31, 2022 |
Real Estate: |  |  |  |  |  |  |  |  |  |  |
Residential | $ | 316,546 |  | 19.7 | % |  | $ | 298,813 |  | 20.3 | %
Commercial |  | 675,156 |  | 42.1 |  |  |  | 651,544 |  | 44.2 |
Agricultural |  | 63,859 |  | 4.0 |  |  |  | 68,915 |  | 4.7 |
Construction |  | 51,453 |  | 3.2 |  |  |  | 32,469 |  | 2.2 |
Commercial loans |  | 200,576 |  | 12.5 |  |  |  | 187,257 |  | 12.7 |
Other agricultural loans |  | 31,966 |  | 2.0 |  |  |  | 35,277 |  | 2.4 |
Consumer loans to individuals |  | 264,321 |  | 16.5 |  |  |  | 200,149 |  | 13.5 |
Total loans |  | 1,603,877 |  | 100.0 | % |  |  | 1,474,424 |  | 100.0 | %
Deferred fees, net |  | (259) |  |  |  |  |  | (479) |  |  |
Total loans receivable |  | 1,603,618 |  |  |  |  |  | 1,473,945 |  |  |
Allowance for credit losses |  | (18,968) |  |  |  |  |  | (16,999) |  |  |
Net loans receivable | $ | 1,584,650 |  |  |  |  | $ | 1,456,946 |  |  |
As of December 31, 2023 and 2022, the Company considered its concentration of credit risk to be acceptable. As of December 31, 2023, the highest concentrations are in commercial rentals and the residential rentals category, with loans outstanding of $149.2 million, or 9.3% of loans outstanding, to commercial rentals, and $115.2 million, or 7.2% of loans outstanding, to residential rentals. For the year ended December 31, 2023, the Company recognized charge offs of $6,000 on commercial rentals and $44,000 on residential rentals. There were no charge-offs on loans within these concentrations in 2022. During 2023, the Company sold residential mortgage loans totaling $4,973,000. During 2022, the Company sold residential mortgage loans totaling $845,000. Gross realized gains and gross realized losses on sales of residential mortgage loans were $63,000 and $0, respectively, in 2023 and $3,000 and $0, respectively, in 2022. The proceeds from the sales of residential mortgage loans totaled $5,036,000 and $848,000 for the years ended December 31, 2023 and 2022, respectively. As of December 31, 2023 and 2022, the outstanding value of loans serviced for others totaled $59.2 million and $60.0 million, respectively Changes in the accretable yield for purchased credit-impaired loans were as follows for the twelve months ended December 31,2022: (In thousands)
|  |  | 2022
Balance at beginning of period |  |  |  | $ | 1,884
Additions |  |  |  |  | —
Accretion |  |  |  |  | (710)
Reclassification and other |  |  |  |  | 653
Balance at end of period |  |  |  | $ | 1,827
The following table presents additional information regarding loans acquired and accounted for in accordance with ASC 310-30 as of December 31, 2022 (in thousands):
|  |  | December 31, 2022
Outstanding Balance |  |  |  |  |
|  |  |  | $ | 8,368
Carrying Amount |  |  |  |  |
|  |  |  | $ | 6,290
The Company maintains a loan review system, which allows for a periodic review of our loan portfolio and the early identification of potential non-performing loans. The system takes into consideration, among other things, delinquency status, size of loans, type and market value of collateral and financial condition of the borrowers. Specific credit loss allowances are established for identified losses based on a review of such information. All loans identified as individually analyzed are evaluated independently. The Company does not aggregate such loans for evaluation purposes. Allowance for credit losses are measured on a loan-by-loan basis for commercial and construction loans by the present value of expected future cash flows discounted at the loan’s effective interest rate, the loan’s obtainable market price, or the fair value of the collateral if the loan is collateral-dependent. The following table shows the amount of loans in each category that were individually and collectively evaluated for credit loss under ASC 326:
| Real Estate Loans |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  | Commercial |  |  | Other |  | Consumer |  |  |
| Residential |  | Commercial |  |  | Agricultural |  | Construction |  | Loans |  |  | Agricultural |  | Loans |  | Total
| (In thousands)
December 31, 2023 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Individually evaluated | $ | 432 |  | $ | 2,211 |  | $ | — |  | $ | — |  | $ | 4,264 |  | $ | — |  | $ | 715 |  | $ | 7,622
Collectively evaluated |  | 316,114 |  |  | 672,945 |  |  | 63,859 |  |  | 51,453 |  |  | 196,312 |  |  | 31,966 |  |  | 263,606 |  |  | 1,596,255
Total Loans | $ | 316,546 |  | $ | 675,156 |  | $ | 63,859 |  | $ | 51,453 |  | $ | 200,576 |  | $ | 31,966 |  | $ | 264,321 |  | $ | 1,603,877
The following table shows the amount of loans in each category that were individually and collectively evaluated for impairment under ASC 310:
| Real Estate Loans |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  | Commercial |  |  | Other |  | Consumer |  |  |
| Residential |  | Commercial |  |  | Agricultural |  | Construction |  | Loans |  |  | Agricultural |  | Loans |  | Total
| (In thousands)
December 31, 2022 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Individually evaluated for impairment | $ | — |  | $ | 402 |  | $ | — |  | $ | — |  | $ | 61 |  | $ | — |  | $ | — |  | $ | 463
Loans acquired with deteriorated credit quality |  | 567 |  |  | 2,049 |  |  | 2,034 |  |  | — |  |  | 1,640 |  |  | — |  |  | — |  |  | 6,290
Collectively evaluated for impairment |  | 298,246 |  |  | 649,093 |  |  | 66,881 |  |  | 32,469 |  |  | 185,556 |  |  | 35,277 |  |  | 200,149 |  |  | 1,467,671
Total Loans | $ | 298,813 |  | $ | 651,544 |  | $ | 68,915 |  | $ | 32,469 |  | $ | 187,257 |  | $ | 35,277 |  | $ | 200,149 |  | $ | 1,474,424
The following table includes the recorded investment and unpaid principal balances for impaired loans with the associated allowance amount, if applicable, under ASC 310.
|  |  |  | Unpaid |  |  |
| Recorded |  | Principal |  | Associated
| Investment |  | Balance |  | Allowance
December 31, 2022 | (In thousands)
With no related allowance recorded: |  |  |  |  |  |  |  |
Real Estate Loans |  |  |  |  |  |  |  |
Commercial | $ | 402 |  | $ | 402 |  | $ | —
Commercial loans |  | 11 |  |  | 11 |  |  | —
Subtotal |  | 413 |  |  | 413 |  |  | —
With an allowance recorded: |  |  |  |  |  |  |  |
Real Estate Loans |  |  |  |  |  |  |  |
Commercial |  | 50 |  |  | 50 |  |  | 50
Subtotal |  | 50 |  |  | 50 |  |  | 50
Total: |  |  |  |  |  |  |  |
Real Estate Loans |  |  |  |  |  |  |  |
Residential |  |  |  |  |  |  |  | —
Commercial | $ | 402 |  | $ | 402 |  | $ | —
Commercial loans |  | 61 |  |  | 61 |  |  | 50
Total Impaired Loans | $ | 463 |  | $ | 463 |  | $ | 50
The following information for impaired loans is presented for the year ended 2022, under ASC 310:
| Average Recorded |  | Interest Income
| Investment |  | Recognized
|  |  |  |  | 2022 |  |  |  |  |  | 2022
|  |  |  |  |  |  | (In thousands) |  |  |
Total: |  |  |  |  |  |  |  |  |  |  |
Real Estate Loans |  |  |  |  |  |  |  |  |  |  |
Commercial |  |  |  | $ | 740 |  |  |  |  | $ | 93
Commercial loans |  |  |  |  | 24 |  |  |  |  |  | —
Total Loans |  |  |  | $ | 764 |  |  |  |  | $ | 93
Management uses an eight point internal risk rating system to monitor the credit quality of the overall loan portfolio. The first four categories are considered not criticized, and are aggregated as “Pass” rated. The criticized rating categories utilized by management generally follow bank regulatory definitions. The Special Mention category includes assets that are currently protected but are potentially weak, resulting in an undue and unwarranted credit risk, but not to the point of justifying a Substandard classification. Loans in the Substandard category have well-defined weaknesses that jeopardize the liquidation of the debt, and have a distinct possibility that some loss will be sustained if the weaknesses are not corrected. Loans greater than 90 days past due are considered Substandard unless full payment is expected. Any portion of a loan that has been charged off is placed in the Loss category. To help ensure that risk ratings are accurate and reflect the present and future capacity of borrowers to repay a loan as agreed, the Company has a structured loan rating process with several layers of internal and external oversight. Generally, consumer and residential mortgage loans are included in the Pass categories unless a specific action, such as nonperformance, repossession, or death occurs to raise awareness of a possible credit event. The Company’s Loan Review Department is responsible for the timely and accurate risk rating of the loans on an ongoing basis. Every credit which must be approved by Loan Committee or the Board of Directors is assigned a risk rating at time of consideration. Loan Review also annually reviews relationships of $1,500,000 and over to assign or re-affirm risk ratings. Based on the most recent analysis performed, the following table presents the recorded investment in non-homogenous pools by internal risk rating systems, under ASC 326 (in thousands):
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | Revolving |  | Revolving |  |
|  |  |  |  | Term Loans Amortized Costs Basis by Origination Year |  | Loans |  | Loans |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | Amortized |  | Converted |  |
December 31, 2023 |  |  |  |  |  | 2023 |  | 2022 |  | 2021 |  | 2020 |  | 2019 |  | Prior |  | Cost Basis |  | to Term |  | Total
Commercial real estate |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Risk Rating |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  |  |  |  | $ | 78,496 | $ | 131,948 | $ | 112,102 | $ | 65,949 | $ | 72,480 | $ | 186,116 | $ | 13,332 | $ | - | $ | 660,423
Special Mention |  |  |  |  |  | 1,300 |  | 411 |  | 243 |  | 1,331 |  | - |  | 6,157 |  | 1,579 |  | - |  | 11,021
Substandard |  |  |  |  |  | - |  | - |  | - |  | 1,444 |  | 36 |  | 2,232 |  | - |  | - |  | 3,712
Doubtful |  |  |  |  |  | - |  | - |  | - |  | - |  | - |  | - |  | - |  | - |  | -
Total |  |  |  |  | $ | 79,796 | $ | 132,359 | $ | 112,345 | $ | 68,724 | $ | 72,516 | $ | 194,505 | $ | 14,911 | $ | - | $ | 675,156
Commercial real estate |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Current period gross charge-offs |  |  |  |  | $ | - | $ | - | $ | - | $ | - | $ | 112 | $ | 42 | $ | - | $ | - | $ | 154
Real Estate - Agriculture |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Risk Rating |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  |  |  |  | $ | 2,635 | $ | 12,509 | $ | 5,433 | $ | 7,606 | $ | 7,746 | $ | 24,654 | $ | 522 | $ | - | $ | 61,105
Special Mention |  |  |  |  |  | - |  | - |  | - |  | - |  | 399 |  | 490 |  | 150 |  | - |  | 1,039
Substandard |  |  |  |  |  | - |  | 508 |  | - |  | 1,018 |  | - |  | 189 |  | - |  | - |  | 1,715
Doubtful |  |  |  |  |  | - |  | - |  | - |  | - |  | - |  | - |  | - |  | - |  | -
Total |  |  |  |  | $ | 2,635 | $ | 13,017 | $ | 5,433 | $ | 8,624 | $ | 8,145 | $ | 25,333 | $ | 672 | $ | - | $ | 63,859
Real Estate - Agriculture |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Current period gross charge-offs |  |  |  |  | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | $ | -
Commercial loans |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Risk Rating |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  |  |  |  | $ | 48,571 | $ | 41,863 | $ | 24,443 | $ | 13,752 | $ | 9,914 | $ | 15,384 | $ | 38,644 | $ | - | $ | 192,571
Special Mention |  |  |  |  |  | 553 |  | 1,412 |  | 257 |  | 134 |  | 20 |  | 188 |  | 768 |  | - |  | 3,332
Substandard |  |  |  |  |  | - |  | 126 |  | 342 |  | 656 |  | - |  | 49 |  | 3,500 |  | - |  | 4,673
Doubtful |  |  |  |  |  | - |  | - |  | - |  | - |  | - |  | - |  | - |  | - |  | -
Total |  |  |  |  | $ | 49,124 | $ | 43,401 | $ | 25,042 | $ | 14,542 | $ | 9,934 | $ | 15,621 | $ | 42,912 | $ | - | $ | 200,576
Commercial loans |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Current period gross charge-offs |  |  |  |  | $ | - | $ | 32 | $ | 24 | $ | 4,856 | $ | - | $ | 41 | $ | - | $ | - | $ | 4,953
Other agricultural loans |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Risk Rating |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  |  |  |  | $ | 2,670 | $ | 5,286 | $ | 3,251 | $ | 2,912 | $ | 2,373 | $ | 3,836 | $ | 11,091 | $ | - | $ | 31,419
Special Mention |  |  |  |  |  | - |  | - |  | 2 |  | 185 |  | 86 |  | - |  | 155 |  | - |  | 428
Substandard |  |  |  |  |  | - |  | - |  | - |  | - |  | 119 |  | - |  | - |  | - |  | 119
Doubtful |  |  |  |  |  | - |  | - |  | - |  | - |  | - |  | - |  | - |  | - |  | -
Total |  |  |  |  | $ | 2,670 | $ | 5,286 | $ | 3,253 | $ | 3,097 | $ | 2,578 | $ | 3,836 | $ | 11,246 | $ | - | $ | 31,966
Other agricultural loans |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Current period gross charge-offs |  |  |  |  | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | $ | -
Total |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Risk Rating |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  |  |  |  | $ | 132,372 | $ | 191,606 | $ | 145,229 | $ | 90,219 | $ | 92,513 | $ | 229,990 | $ | 63,589 | $ | - | $ | 945,518
Special Mention |  |  |  |  |  | 1,853 |  | 1,823 |  | 502 |  | 1,650 |  | 505 |  | 6,835 |  | 2,652 |  | - |  | 15,820
Substandard |  |  |  |  |  | - |  | 634 |  | 342 |  | 3,118 |  | 155 |  | 2,470 |  | 3,500 |  | - |  | 10,219
Doubtful |  |  |  |  |  | - |  | - |  | - |  | - |  | - |  | - |  | - |  | - |  | -
Total |  |  |  |  | $ | 134,225 | $ | 194,063 | $ | 146,073 | $ | 94,987 | $ | 93,173 | $ | 239,295 | $ | 69,741 | $ | - | $ | 971,557
The following table presents the classes of the loan portfolio summarized by the aggregate Pass and the criticized categories of Special Mention, Substandard, Doubtful and Loss within the internal risk rating system as of December 31, 2022 (in thousands):
|  |  |  | Special |  |  |  |  |  |  |  |  |  |  |  |
| Pass |  | Mention |  | Substandard |  | Doubtful |  | Loss |  | Total
December 31, 2022 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial real estate loans | $ | 646,775 |  | $ | 1,079 |  | $ | 3,690 |  | $ | — |  | $ | — |  | $ | 651,544
Real estate - agricultural |  | 66,444 |  |  | 368 |  |  | 2,103 |  |  | — |  |  | — |  |  | 68,915
Commercial loans |  | 186,966 |  |  | 184 |  |  | 107 |  |  | — |  |  | — |  |  | 187,257
Other agricultural loans |  | 34,071 |  |  | 556 |  |  | 650 |  |  | — |  |  | — |  |  | 35,277
Total | $ | 934,256 |  | $ | 2,187 |  | $ | 6,550 |  | $ | — |  | $ | — |  | $ | 942,993
The Company monitors the credit risk profile by payment activity for residential and consumer loan classes. Loans past due over 90 days and loans on nonaccrual status are considered nonperforming. Nonperforming loans are reviewed monthly. The following table presents the carrying value of residential and consumer loans based on payment activity (in thousands):
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | Revolving |  | Revolving |  |
|  |  |  |  | Term Loans Amortized Costs Basis by Origination Year |  | Loans |  | Loans |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | Amortized |  | Converted |  |
December 31, 2023 |  |  |  |  |  | 2023 |  | 2022 |  | 2021 |  | 2020 |  | 2019 |  | Prior |  | Cost Basis |  | to Term |  | Total
Residential real estate |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Payment Performance |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Performing |  |  |  |  | $ | 27,446 | $ | 62,178 | $ | 57,691 | $ | 35,357 | $ | 16,406 | $ | 87,951 | $ | 29,085 | $ | - | $ | 316,114
Nonperforming |  |  |  |  |  | - |  | - |  | - |  | - |  | 58 |  | 324 |  | 50 |  | - |  | 432
Total |  |  |  |  | $ | 27,446 | $ | 62,178 | $ | 57,691 | $ | 35,357 | $ | 16,464 | $ | 88,275 | $ | 29,135 | $ | - | $ | 316,546
Residential real estate |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Current period gross charge-offs |  |  |  |  | $ | - | $ | - | $ | - | $ | - | $ | - | $ | 34 | $ | - | $ | - | $ | 34
Construction |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Payment Performance |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Performing |  |  |  |  | $ | 23,500 | $ | 14,906 | $ | 6,791 | $ | 1,599 | $ | 1,829 | $ | 624 | $ | 2,204 | $ | - | $ | 51,453
Nonperforming |  |  |  |  |  | - |  | - |  | - |  | - |  | - |  | - |  | - |  | - |  | -
Total |  |  |  |  | $ | 23,500 | $ | 14,906 | $ | 6,791 | $ | 1,599 | $ | 1,829 | $ | 624 | $ | 2,204 | $ | - | $ | 51,453
Construction |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Current period gross charge-offs |  |  |  |  | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | $ | -
Consumer loans to individuals |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Payment Performance |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Performing |  |  |  |  | $ | 127,243 | $ | 76,339 | $ | 24,584 | $ | 14,343 | $ | 10,217 | $ | 9,942 | $ | 938 | $ | - | $ | 263,606
Nonperforming |  |  |  |  |  | 111 |  | 404 |  | 118 |  | 31 |  | 41 |  | 10 |  | - |  | - |  | 715
Total |  |  |  |  | $ | 127,354 | $ | 76,743 | $ | 24,702 | $ | 14,374 | $ | 10,258 | $ | 9,952 | $ | 938 | $ | - | $ | 264,321
Consumer loans to individuals |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Current period gross charge-offs |  |  |  |  | $ | 45 | $ | 710 | $ | 200 | $ | 35 | $ | 45 | $ | 28 | $ | 4 | $ | - | $ | 1,067
Total |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Payment Performance |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Performing |  |  |  |  | $ | 178,189 | $ | 153,423 | $ | 89,066 | $ | 51,299 | $ | 28,452 | $ | 98,517 | $ | 32,227 | $ | - | $ | 631,173
Nonperforming |  |  |  |  |  | 111 |  | 404 |  | 118 |  | 31 |  | 99 |  | 334 |  | 50 |  | - |  | 1,147
Total |  |  |  |  | $ | 178,300 | $ | 153,827 | $ | 89,184 | $ | 51,330 | $ | 28,551 | $ | 98,851 | $ | 32,277 | $ | - | $ | 632,320
For residential real estate loans, construction loans and consumer loans, the Company evaluates credit quality based on the performance of the individual credits. The following table presents the recorded investment in the loan classes based on payment activity as of December 31, 2022, under ASC 310 (in thousands):
| Performing |  | Nonperforming |  | Total
December 31, 2022 |  |  |  |  |  |  |  |
Residential real estate loans | $ | 298,327 |  | $ | 486 |  | $ | 298,813
Construction |  | 32,469 |  |  | — |  |  | 32,469
Consumer loans to individuals |  | 199,985 |  |  | 164 |  |  | 200,149
Total | $ | 530,781 |  | $ | 650 |  | $ | 531,431
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 presents the classes of the loan portfolio summarized by the aging categories of performing loans and nonaccrual loans as of December 31, 2023 and December 31, 2022 (in thousands):
| Current |  | 31-60 Days Past Due |  | 61-90 Days Past Due |  | Greater than 90 Days Past Due and still accruing |  | Non-Accrual |  | Total Past Due and Non-Accrual |  | Total Loans |  |
December 31, 2023 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Real Estate loans |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Residential | $ | 315,224 |  | $ | 877 |  | $ | 13 |  | $ | — |  | $ | 432 |  | $ | 1,322 |  | $ | 316,546 |  |  |
Commercial |  | 666,768 |  |  | 6,177 |  |  | — |  |  | — |  |  | 2,211 |  |  | 8,388 |  |  | 675,156 |  |  |
Agricultural |  | 63,732 |  |  | 127 |  |  | — |  |  | — |  |  | — |  |  | 127 |  |  | 63,859 |  |  |
Construction |  | 51,435 |  |  | — |  |  | 18 |  |  | — |  |  | — |  |  | 18 |  |  | 51,453 |  |  |
Commercial loans |  | 192,988 |  |  | 3,170 |  |  | 154 |  |  | — |  |  | 4,264 |  |  | 7,588 |  |  | 200,576 |  |  |
Other agricultural loans |  | 31,959 |  |  | 7 |  |  | — |  |  | — |  |  | — |  |  | 7 |  |  | 31,966 |  |  |
Consumer loans |  | 262,578 |  |  | 865 |  |  | 163 |  |  | — |  |  | 715 |  |  | 1,743 |  |  | 264,321 |  |  |
Total | $ | 1,584,684 |  | $ | 11,223 |  | $ | 348 |  | $ | — |  | $ | 7,622 |  | $ | 19,193 |  | $ | 1,603,877 |  |  |
| Current |  | 31-60 Days Past Due |  | 61-90 Days Past Due |  | Greater than 90 Days Past Due and still accruing |  | Non-Accrual |  | Total Past Due and Non-Accrual |  | Purchased Credit Impaired Loans |  | Total Loans
December 31, 2022 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Real Estate loans |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Residential | $ | 297,350 |  | $ | 187 |  | $ | 223 |  | $ | — |  | $ | 486 |  | $ | 896 |  | $ | 567 |  | $ | 298,813
Commercial |  | 648,688 |  |  | 405 |  |  | — |  |  | — |  |  | 402 |  |  | 807 |  |  | 2,049 |  |  | 651,544
Agricultural |  | 66,751 |  |  | 130 |  |  | — |  |  | — |  |  | — |  |  | 130 |  |  | 2,034 |  |  | 68,915
Construction |  | 32,469 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | - |  |  | 32,469
Commercial loans |  | 185,485 |  |  | 71 |  |  | — |  |  | — |  |  | 61 |  |  | 132 |  |  | 1,640 |  |  | 187,257
Other agricultural loans |  | 35,277 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 35,277
Consumer loans |  | 198,893 |  |  | 853 |  |  | 239 |  |  | — |  |  | 164 |  |  | 1,256 |  |  | - |  |  | 200,149
Total | $ | 1,464,913 |  | $ | 1,646 |  | $ | 462 |  | $ | — |  | $ | 1,113 |  | $ | 3,221 |  | $ | 6,290 |  | $ | 1,474,424
The following table presents the carrying value of loans on nonaccrual status and loans past due over 90 days still accruing interest (in thousands):
|  | Nonaccrual |  |  | Nonaccrual |  |  |  |  |  | Loans Past Due |  |  |
|  | with no |  |  | with |  |  | Total |  |  | Over 90 Days |  |  | Total
| ACL |  | ACL |  | Nonaccrual |  | Still Accruing |  | Nonperforming
December 31, 2023 |  |  |  |  |  |  |  |  |  |  |  |  |  |
Real Estate loans |  |  |  |  |  |  |  |  |  |  |  |  |  |
Residential | $ | 432 |  | $ | - |  | $ | 432 |  | $ | - |  | $ | 432
Commercial |  | 2,211 |  |  | - |  |  | 2,211 |  |  | - |  |  | 2,211
Agricultural |  | - |  |  | - |  |  | - |  |  | - |  |  | -
Construction |  | - |  |  | - |  |  | - |  |  | - |  |  | -
Commercial loans |  | 4,264 |  |  | - |  |  | 4,264 |  |  | - |  |  | 4,264
Other agricultural loans |  | - |  |  | - |  |  | - |  |  | - |  |  | -
Consumer loans |  | 162 |  |  | 553 |  |  | 715 |  |  | - |  |  | 715
Total | $ | 7,069 |  | $ | 553 |  | $ | 7,622 |  | $ | - |  | $ | 7,622
The following table presents, by class of loans and leases, the amortized cost basis of collateral-dependent nonaccrual loans and leases and type of collateral as of December 31, 2023:
| Real Estate |  | Other |  | None |  | Total
December 31, 2023 |  |  |  |  |  |  |  |  |  |  |
Real Estate loans |  |  |  |  |  |  |  |  |  |  |
Residential | $ | 432 |  | $ | - |  | $ | - |  | $ | 432
Commercial |  | 2,211 |  |  | - |  |  | - |  |  | 2,211
Agricultural |  | - |  |  | - |  |  | - |  |  | -
Construction |  | - |  |  | - |  |  | - |  |  | -
Commercial loans |  | 49 |  |  | 4,215 |  |  | - |  |  | 4,264
Other agricultural loans |  | - |  |  | - |  |  | - |  |  | -
Consumer loans |  | - |  |  | 715 |  |  | - |  |  | 715
Total | $ | 2,692 |  | $ | 4,930 |  | $ | - |  | $ | 7,622
The following table presents the allowance for credit losses by the classes of the loan portfolio under ASC 326:
(In thousands) | Residential Real Estate |  | Commercial Real Estate |  | Agricultural |  | Construction |  | Commercial |  | Other Agricultural |  | Consumer |  | Total
Beginning balance, December 31, 2022 | $ | 2,833 |  | $ | 8,293 |  | $ | 259 |  | $ | 409 |  | $ | 2,445 |  | $ | 124 |  | $ | 2,636 |  | $ | 16,999
Impact of adopting ASC 326 |  | (1,545) |  |  | 5,527 |  |  | (200) |  |  | 388 |  |  | (1,156) |  |  | 3 |  |  | (551) |  |  | 2,466
Charge Offs |  | (34) |  |  | (154) |  |  | — |  |  | — |  |  | (4,953) |  |  | — |  |  | (1,067) |  |  | (6,208)
Recoveries |  | 6 |  |  | 15 |  |  | — |  |  | — |  |  | 21 |  |  | — |  |  | 88 |  |  | 130
Provision for credit losses |  | 91 |  |  | (1,810) |  |  | (1) |  |  | 136 |  |  | 4,850 |  |  | (33) |  |  | 2,348 |  |  | 5,581
Ending balance, December 31, 2023 | $ | 1,351 |  | $ | 11,871 |  | $ | 58 |  | $ | 933 |  | $ | 1,207 |  | $ | 94 |  | $ | 3,454 |  | $ | 18,968
Ending balance individually evaluated | $ | — |  | $ | — |  | $ | — |  | $ | — |  | $ | — |  | $ | — |  | $ | 135 |  | $ | 135
Ending balance collectively evaluated | $ | 1,351 |  | $ | 11,871 |  | $ | 58 |  | $ | 933 |  | $ | 1,207 |  | $ | 94 |  | $ | 3,319 |  | $ | 18,833
The following table presents the allowance for loan losses by the classes of the loan portfolio under ASC 310:
(In thousands) | Residential Real Estate |  | Commercial Real Estate |  | Agricultural |  | Construction |  | Commercial |  | Other Agricultural |  | Consumer |  | Total
Beginning balance, December 31, 2021 | $ | 2,175 |  | $ | 10,878 |  | $ | — |  | $ | 133 |  | $ | 1,490 |  | $ | — |  | $ | 1,766 |  | $ | 16,442
Charge Offs |  | (172) |  |  | (20) |  |  | — |  |  | — |  |  | (16) |  |  | — |  |  | (457) |  |  | (665)
Recoveries |  | 130 |  |  | 82 |  |  | — |  |  | — |  |  | 46 |  |  | — |  |  | 64 |  |  | 322
Provision for loan losses |  | 700 |  |  | (2,647) |  |  | 259 |  |  | 276 |  |  | 925 |  |  | 124 |  |  | 1,263 |  |  | 900
Ending balance, December 31, 2022 | $ | 2,833 |  | $ | 8,293 |  | $ | 259 |  | $ | 409 |  | $ | 2,445 |  | $ | 124 |  | $ | 2,636 |  | $ | 16,999
Ending balance individually evaluated for impairment | $ | — |  | $ | — |  | $ | — |  | $ | — |  | $ | 50 |  | $ | — |  | $ | — |  | $ | 50
Ending balance collectively evaluated ‎for impairment | $ | 2,833 |  | $ | 8,293 |  | $ | 259 |  | $ | 409 |  | $ | 2,395 |  | $ | 124 |  | $ | 2,636 |  | $ | 16,949
The cumulative loss rate used as the basis for the estimate of credit losses is comprised of the Company’s historical loss experience. The Company chose to apply qualitative factors based on “quantitative metrics” which link the quantifiable metrics to historical changes in the qualitative factor categories. The Company also chose to apply economic projections to the model. A select group of economic indicators was utilized which was then correlated to the historical loss experience of the Company and its peers. Based on the correlation results, the economic adjustments are then weighted for relevancy and applied to the individual loan pools. During the period ended December 31, 2023, the allowance for credit losses increased from $16,999,000 to $18,968,000 This $1,969,000 increase in the required allowance was due primarily to charge-offs on one large commercial relationship. During the period ended December 31, 2022, the allowance for loan losses increased from $16,442,000 to $16,999,000. This $557,000 increase in the required allowance was due primarily to a $2.4 million increase in the qualitative factor related to loan growth and a $445,000 increase in the qualitative factor related to large balance loans, which was partially offset by a $2.3 million decrease in the qualitative factor related to the Covid pandemic. Interest income that would have been recorded on loans accounted for on a non-accrual basis under the original terms of the loans was $694,000 and $182,000 for 2023 and 2022, respectively. Occasionally, the Bank 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 Bank 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 presents modifications made to borrowers experiencing financial difficulty:
Loan Modifications Made to Borrowers Experiencing Financial Difficulty
Term Extension
|  | Amortized Cost Basis at December 31, 2023 |  |  | % of Total Class of Financing Receivable |  |  |  | Financial Effect
Commercial real estate loans | $ | 4,321,547 |  |  | 0.64 | % |  |  | Extended maturity date of loans by three to six months.
Total | $ | 4,321,547 |  |  |  |  |  |  |
Combination - Term Extension and Interest Rate Adjustment
|  | Amortized Cost Basis at December 31, 2023 |  |  | % of Total Class of Financing Receivable |  |  |  | Financial Effect
Consumer loans to individuals | $ | 19,225 |  |  | 0.01 | % |  |  | New loans were granted which extended terms for a weighted average of 34 months and rates were increased from a weighted average rate of 5.25% to a weighted average rate of 11.03%
Total | $ | 19,225 |  |  |  |  |  |  |
As of December 31, 2023, all loan modifications made to borrowers experiencing financial difficulty were current per the modified contractual terms. During the year ended December 31, 2023, the Company adopted ASU 2022-02 on a modified retrospective basis. ASU 2022-02 eliminates the TDR accounting model, and requires that the Company evaluate, based on the accounting for loan modifications, whether the borrower is experiencing financial difficulty and the modification results in a more-than-insignificant direct change in the contractual cash flows and represents a new loan or a continuation of an existing loan. This change required all loan modifications to be accounted for under the general loan modification guidance in ASC 310-20, Receivables – Nonrefundable Fees and Other Costs, and subject entities to new disclosure requirements on loan modifications to borrowers experiencing financial difficulty. Upon adoption of CECL, the TDRs were evaluated and included in the CECL loan segment pools if the loans shared similar risk characteristics to other loans in the pool or remained with individually evaluated loans for which the ACL was measured using the collateral-dependent or discounted cash flow method. As of December 31, 2022, there were no troubled debt restructured loans. During 2022, there were no new loans relationships identified as troubled debt restructurings. During 2022, there were no charge-offs on loans classified as troubled debt restructurings.

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- Definition The entire disclosure for claims held for amounts due a entity, excluding financing receivables. Examples include, but are not limited to, trade accounts receivables, notes receivables, loans receivables. Includes disclosure for allowance for credit losses. + References Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef -Topic 310 -SubTopic 10 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//310-10/tableOfContent + Details
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