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Loans and Allowance for Loan Credit Losses
 12 Months Ended
Dec. 31, 2024
Receivables [Abstract]  
Loans and Allowance for Loan Credit Losses Loans and Allowance for Loan Credit Losses
A summary of the composition of the loan portfolio at December 31, 2024 and December 31, 2023 is as follows (dollars in thousands):
December 31, 2024December 31, 2023
Commercial real estate$53,480 $60,138 
Commercial27,883 12,438 
Residential real estate closed-end210,730 210,358 
Other consumer loans21,194 21,210 
313,287 304,144 
Less allowance for credit losses(4,514)(4,319)
Loans, net$308,773 $299,825 
Overdrafts totaling $27 thousand and $10 thousand at December 31, 2024 and December 31, 2023, respectively, were reclassified from deposits to loans.
The totals above include deferred costs (net of deferred fees) of $519 thousand at December 31, 2024 and $466 thousand at December 31, 2023.
The following tables present the activity in the allowance for credit losses by portfolio segment for the twelve months ended December 31, 2024 and 2023 (dollars in thousands):
December 31, 2024
Commercial
Real Estate		CommercialResidential
Real Estate
Closed-End		Other
Consumer
Loans		Total
Allowance for credit losses:
Beginning balance, December 31, 2023$1,233 $189 $2,668 $229 $4,319 
Provision for (recapture of) credit losses(93)294 (24)18 195 
Loans charged-off— — — — — 
Recoveries collected— — — — — 
Ending balance, December 31, 2024$1,140 $483 $2,644 $247 $4,514 
December 31, 2023
Commercial
Real Estate		CommercialResidential
Real Estate
Closed-End		Other
Consumer
Loans		Total
Allowance for credit losses:
Beginning balance, December 31, 2022$905 $573 $2,650 $354 $4,482 
Impact of adopting ASC 326130 19 (16)(133)— 
Provision for (recapture of) credit losses198 (403)34 8 (163)
Loans charged-off— — — — — 
Recoveries collected— — — — — 
Ending balance, December 31, 2023$1,233 $189 $2,668 $229 $4,319 
There were no nonaccrual loans, loans 90 days past due and still accruing, or past due for 30 or more days as of December 31, 2024 and December 31, 2023.
The Company categorizes loans into risk categories based on relevant information about the ability of borrowers to service their debt such as: current financial information, historical payment experience, credit documentation, public information and current economic trends, among other factors. The Company’s loan risk grading system and ongoing monitoring process is discussed in Note 1.
The following table presents the outstanding balance of the loan portfolio, by year of origination, loan classification, and credit quality, as of December 31, 2024 and December 31, 2023 (dollars in thousands):
December 31, 2024Term Loans by Year of OriginationRevolving LoansRevolving to Term LoansTotal
20242023202220212020Prior
Commercial real estate
Pass$2,873 $2,526 $6,461 $7,250 $3,424 $25,849 $— $— $48,383 
Special Mention— — — 1,576 — — — — 1,576 
Substandard— — 1,676 — — 1,845 — — 3,521 
Doubtful— — — — — — — — — 
Loss— — — — — — — — — 
Total$2,873 $2,526 $8,137 $8,826 $3,424 $27,694 $— $— $53,480 
Current period gross charge-offs
$— $— $— $— $— $— $— $— $— 
Commercial
Pass$403 $— $552 $9 $— $1,147 $25,772 $— $27,883 
Special Mention— — — — — — — — — 
Substandard— — — — — — — — — 
Doubtful— — — — — — — — — 
Loss— — — — — — — — — 
Total$403 $— $552 $9 $— $1,147 $25,772 $— $27,883 
Current period gross charge-offs
$— $— $— $— $— $— $— $— $— 
Residential real estate closed-end
Pass$15,969 $17,834 $47,200 $43,125 $23,145 $63,222 $— $— $210,495 
Special Mention— — — — — — — — — 
Substandard— — — — — 236 — — 236 
Doubtful— — — — — — — — — 
Loss— — — — — — — — — 
Total$15,969 $17,834 $47,200 $43,125 $23,145 $63,458 $— $— $210,730 
Current period gross charge-offs
$— $— $— $— $— $— $— $— $— 
Other consumer loans
Pass$17 $— $— $18 $— $— $19,336 $1,823 $21,194 
Special Mention— — — — — — — — — 
Substandard— — — — — — — — — 
Doubtful— — — — — — — — — 
Loss— — — — — — — — — 
Total$17 $— $— $18 $— $— $19,336 $1,823 $21,194 
Current period gross charge-offs
— — — — — — — — — 
Total Portfolio Loans
Pass$19,262 $20,360 $54,213 $50,402 $26,569 $90,218 $45,108 $1,823 $307,955 
Special Mention— — — 1,576 — — — — 1,576 
Substandard— — 1,676 — — 2,081 — — 3,757 
Doubtful— — — — — — — — — 
Loss— — — — — — — — — 
Total Portfolio Loans$19,262 $20,360 $55,889 $51,978 $26,569 $92,298 $45,108 $1,823 $313,287 
Current period gross charge-offs— — — — — — — — — 
December 31, 2023Term Loans by Year of OriginationRevolving
Loans		Revolving to Term LoansTotal
20232022202120202019Prior
Commercial real estate
Pass$849 $5,521 $9,327 $3,713 $8,015 $21,875 $— $8,895 $58,195 
Special Mention— — — — — 1,570 — — 1,570 
Substandard— — — — — 373 — — 373 
Doubtful— — — — — — — — — 
Loss— — — — — — — — — 
Total$849 $5,521 $9,327 $3,713 $8,015 $23,818 $— $8,895 $60,138 
Current period gross charge-offs
$— $— $— $— $— $— $— $— $— 
Commercial
Pass$— $573 $14 $42 $1,352 $309 $10,148 $— $12,438 
Special Mention— — — — — — — — — 
Substandard— — — — — — — — — 
Doubtful— — — — — — — — — 
Loss— — — — — — — — — 
Total$— $573 $14 $42 $1,352 $309 $10,148 $— $12,438 
Current period gross charge-offs
$— $— $— $— $— $— $— $— $— 
Residential real estate closed end
Pass$20,230 $45,920 $45,528 $25,150 $18,035 $55,253 $— $— $210,116 
Special Mention— — — — — — — — — 
Substandard— — — — — 242 — — 242 
Doubtful— — — — — — — — — 
Loss— — — — — — — — — 
Total$20,230 $45,920 $45,528 $25,150 $18,035 $55,495 $— $— $210,358 
Current period gross charge-offs
$— $— $— $— $— $— $— $— $— 
Other consumer loans
Pass$— $— $32 $— $— $— $17,703 $3,475 $21,210 
Special Mention— — — — — — — — — 
Substandard— — — — — — — — — 
Doubtful— — — — — — — — — 
Loss— — — — — — — — — 
Total$— $— $32 $— $— $— $17,703 $3,475 $21,210 
Current period gross charge-offs
$— $— $— $— $— $— $— $— $— 
Total Portfolio Loans
Pass$21,079 $52,014 $54,901 $28,905 $27,402 $77,437 $27,851 $12,370 $301,959 
Special Mention— — — — — 1,570 — — 1,570 
Substandard— — — — — 615 — — 615 
Doubtful— — — — — — — — — 
Loss— — — — — — — — — 
Total Portfolio Loans$21,079 $52,014 $54,901 $28,905 $27,402 $79,622 $27,851 $12,370 $304,144 
Current period gross charge-offs— — — — — — — — — 
Collateral Dependent Loans
FASB ASC Topic 326 describes a collateral-dependent asset as a financial asset for which the repayment is expected to be provided substantially through the operation or sale of the collateral when the borrower, based on management’s assessment, is experiencing financial difficulty as of the reporting date. Whether the underlying collateral is expected to be a substantial source of repayment for an asset depends on the availability, reliability, and capacity of sources other than the collateral to repay the debt. Collateral-dependent loans are individually evaluated for expected credit losses as of the reporting date, and they are removed from their respective pools of collectively evaluated assets. Expected credit losses for these types of assets are based on the fair value of the collateral at the measurement date, adjusted for estimated selling costs. There were no collateral-dependent loans that were individually evaluated for purposes of determining the allowance for credit loss under FASB ASC Topic 326 as of December 31, 2024 and December 31, 2023.
Modifications to Borrowers Experiencing Financial Difficulty
The Company may modify loans to borrowers in financial distress by providing principal forgiveness, term extension, and 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. There were no loan modifications provided to borrowers exhibiting financial distress during the twelve months ended December 31, 2024 and 2023, and there were no such prior modifications in existence during the periods reported. During the reported periods, there were no payment defaults from any such loans during the twelve months preceding the modification because no such modifications were in existence during the periods.
Related Party Loan Transactions
Officers, directors and their affiliates had loans outstanding with the Company of $8.6 million and $6.9 million as of December 31, 2024 and December 31, 2023, respectively. During 2024, total principal payments were $189 thousand. The remaining increase in the credit outstanding of $1.9 million, relates to the cumulative effect of changes in the composition of related parties, due to the hiring of a new officer. These transactions occurred in the ordinary course of business on substantially the same terms as those prevailing at the time for comparable transactions with unrelated persons.