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Allowance for Credit Losses (Tables)

3 Months Ended

Mar. 31, 2024

Allowance for Credit Losses

Schedule of changes in the allowance for credit and loan losses

Consumer

(Dollars in thousands)

Commercial

Consumer

Finance

Total

Allowance for credit losses:

Balance at December 31, 2023

$

12,315

$

3,758

$

23,578

$

39,651

Provision charged to operations

535

65

3,000

3,600

Loans charged off

—

(101)

(4,103)

(4,204)

Recoveries of loans previously charged off

9

53

1,091

1,153

Balance at March 31, 2024

$

12,859

$

3,775

$

23,566

$

40,200

Consumer

(Dollars in thousands)

Commercial

Consumer

Finance

Total

Allowance for credit losses:

Balance at December 31, 2022

$

11,219

$

3,330

$

25,969

$

40,518

Impact of ASC 326 adoption on non-PCD loans

(617)

98

406

(113)

Impact of ASC 326 adoption on PCD loans

595

9

—

604

Provision charged to operations

233

117

1,600

1,950

Loans charged off

(16)

(89)

(3,108)

(3,213)

Recoveries of loans previously charged off

35

45

1,008

1,088

Balance at March 31, 2023

$

11,449

$

3,510

$

25,875

$

40,834

Schedule of breakdown of provision for credit losses


		Three Months Ended March 31,
(Dollars in thousands)		2024			2023
Provision for credit losses:
Provision for loans		$	3,600		$	1,950
Provision for unfunded commitments			(100)			100
Total		$	3,500		$	2,050

Schedule of loans by credit quality indicators

The table below details the recorded balance of the classes of loans within the commercial and consumer loan portfolios by loan rating, which is reviewed on a quarterly basis, and year of origination as of March 31, 2024:


																				Revolving			Revolving
		Term Loans Recorded Balance by Origination Year																		Loans			Loans
																				Recorded			Converted
(Dollars in thousands)		2024			2023			2022			2021			2020			Prior			Balance			to Term¹			Total
Commercial real estate:
Loan Rating
Pass		$	43,928		$	80,300		$	124,273		$	153,348		$	114,997		$	169,989		$	—		$	116		$	686,951
Special Mention			—			—			—			5,699			—			953			—			—			6,652
Total		$	43,928		$	80,300		$	124,273		$	159,047		$	114,997		$	170,942		$	—		$	116		$	693,603

Commercial business:
Loan Rating
Pass		$	2,533		$	16,156		$	18,358		$	16,552		$	11,782		$	27,633		$	22,967		$	169		$	116,150
Special Mention			27			59			—			—			—			—			—			—			86
Total		$	2,560		$	16,215		$	18,358		$	16,552		$	11,782		$	27,633		$	22,967		$	169		$	116,236

Construction - commercial real estate:
Loan Rating
Pass		$	5,771		$	38,685		$	48,979		$	—		$	3,481		$	—		$	—		$	—		$	96,916
Total		$	5,771		$	38,685		$	48,979		$	—		$	3,481		$	—		$	—		$	—		$	96,916

Land acquisition and development:
Loan Rating
Pass		$	265		$	5,959		$	4,251		$	9,176		$	9,993		$	—		$	—		$	—		$	29,644
Total		$	265		$	5,959		$	4,251		$	9,176		$	9,993		$	—		$	—		$	—		$	29,644

Builder lines:
Loan Rating
Pass		$	8,790		$	16,055		$	3,020		$	94		$	—		$	404		$	—		$	—		$	28,363
Total		$	8,790		$	16,055		$	3,020		$	94		$	—		$	404		$	—		$	—		$	28,363

Construction - consumer real estate:
Loan Rating
Pass		$	456		$	9,976		$	1,651		$	—		$	—		$	—		$	388		$	—		$	12,471
Total		$	456		$	9,976		$	1,651		$	—		$	—		$	—		$	388		$	—		$	12,471

Residential mortgage:
Loan Rating
Pass		$	13,949		$	60,002		$	88,854		$	43,262		$	38,608		$	54,635		$	—		$	—		$	299,310
Special Mention			—			—			—			—			—			43			—			—			43
Substandard			—			—			—			—			103			281			—			—			384
Substandard Nonaccrual			134			—			—			—			—			307			—			—			441
Total		$	14,083		$	60,002		$	88,854		$	43,262		$	38,711		$	55,266		$	—		$	—		$	300,178

Equity lines:
Loan Rating
Pass		$	—		$	—		$	—		$	—		$	70		$	850		$	53,048		$	329		$	54,297
Substandard			—			—			—			—			—			5			—			62			67
Substandard Nonaccrual			—			—			—			—			—			—			—			99			99
Total		$	—		$	—		$	—		$	—		$	70		$	855		$	53,048		$	490		$	54,463

Other consumer:
Loan Rating
Pass		$	1,101		$	4,394		$	2,389		$	516		$	219		$	770		$	51		$	—		$	9,440
Substandard Nonaccrual			—			—			—			—			—			10			—			—			10
Total		$	1,101		$	4,394		$	2,389		$	516		$	219		$	780		$	51		$	—		$	9,450

Total:
Loan Rating
Pass		$	76,793		$	231,527		$	291,775		$	222,948		$	179,150		$	254,281		$	76,454		$	614		$	1,333,542
Special Mention			27			59			—			5,699			—			996			—			—			6,781
Substandard			—			—			—			—			103			286			—			62			451
Substandard Nonaccrual			134			—			—			—			—			317			—			99			550
Total		$	76,954		$	231,586		$	291,775		$	228,647		$	179,253		$	255,880		$	76,454		$	775		$	1,341,324

1

For the three months ended March 31, 2024, $58,000 of equity lines revolving loans were converted to term.

The table below details the recorded balance of the classes of loans within the commercial and consumer loan portfolios by loan rating, which is reviewed on a quarterly basis, and year of origination as of December 31, 2023:


																				Revolving			Revolving
		Term Loans Recorded Balance by Origination Year																		Loans			Loans
																				Recorded			Converted
(Dollars in thousands)		2023			2022			2021			2020			2019			Prior			Balance			to Term¹			Total
Commercial real estate:
Loan Rating
Pass		$	81,324		$	125,278		$	155,805		$	121,365		$	37,383		$	140,158		$	—		$	119		$	661,432
Special Mention			—			—			5,731			—			—			959			—			—			6,690
Total		$	81,324		$	125,278		$	161,536		$	121,365		$	37,383		$	141,117		$	—		$	119		$	668,122

Commercial business:
Loan Rating
Pass		$	18,682		$	18,190		$	17,219		$	12,062		$	14,847		$	15,339		$	18,686		$	261		$	115,286
Special Mention			62			—			—			—			—			—			—			—			62
Total		$	18,744		$	18,190		$	17,219		$	12,062		$	14,847		$	15,339		$	18,686		$	261		$	115,348

Construction - commercial real estate:
Loan Rating
Pass		$	29,346		$	36,907		$	—		$	3,515		$	—		$	—		$	—		$	—		$	69,768
Total		$	29,346		$	36,907		$	—		$	3,515		$	—		$	—		$	—		$	—		$	69,768

Land acquisition and development:
Loan Rating
Pass		$	4,562		$	4,665		$	9,844		$	9,993		$	—		$	—		$	—		$	—		$	29,064
Total		$	4,562		$	4,665		$	9,844		$	9,993		$	—		$	—		$	—		$	—		$	29,064

Builder lines:
Loan Rating
Pass		$	17,919		$	5,124		$	1,221		$	—		$	404		$	—		$	—		$	—		$	24,668
Total		$	17,919		$	5,124		$	1,221		$	—		$	404		$	—		$	—		$	—		$	24,668

Construction - consumer real estate:
Loan Rating
Pass		$	7,889		$	3,240		$	—		$	—		$	—		$	—		$	94		$	—		$	11,223
Total		$	7,889		$	3,240		$	—		$	—		$	—		$	—		$	94		$	—		$	11,223

Residential mortgage:
Loan Rating
Pass		$	59,441		$	91,086		$	44,292		$	40,089		$	11,524		$	46,192		$	—		$	—		$	292,624
Special Mention			—			—			—			—			—			44			—			—			44
Substandard			—			—			—			103			—			165			—			—			268
Substandard Nonaccrual			—			—			—			—			62			258			—			—			320
Total		$	59,441		$	91,086		$	44,292		$	40,192		$	11,586		$	46,659		$	—		$	—		$	293,256

Equity lines:
Loan Rating
Pass		$	—		$	—		$	34		$	70		$	—		$	857		$	50,120		$	344		$	51,425
Special Mention			—			—			—			—			—			—			—			85			85
Substandard			—			—			—			—			5			—			—			—			5
Substandard Nonaccrual			—			—			—			—			—			9			—			68			77
Total		$	—		$	—		$	34		$	70		$	5		$	866		$	50,120		$	497		$	51,592

Other consumer:
Loan Rating
Pass		$	6,263		$	2,762		$	606		$	282		$	101		$	519		$	46		$	—		$	10,579
Substandard Nonaccrual			—			—			—			—			9			—			—			—			9
Total		$	6,263		$	2,762		$	606		$	282		$	110		$	519		$	46		$	—		$	10,588

Total:
Loan Rating
Pass		$	225,426		$	287,252		$	229,021		$	187,376		$	64,259		$	203,065		$	68,946		$	724		$	1,266,069
Special Mention			62			—			5,731			—			—			1,003			—			85			6,881
Substandard			—			—			—			103			5			165			—			—			273
Substandard Nonaccrual			—			—			—			—			71			267			—			68			406
Total		$	225,488		$	287,252		$	234,752		$	187,479		$	64,335		$	204,500		$	68,946		$	877		$	1,273,629

1

All balances shown in this column were converted to term during the year ended December 31, 2023.

The table below details the recorded balance of the classes of loans within the consumer finance loan portfolio by credit rating at the time of origination and year of origination as of March 31, 2024:

Revolving

Term Loans Recorded Balance by Origination Year

Loans

Revolving

Converted

(Dollars in thousands)

2024

2023

2022

2021

2020

Prior

Loans

to Term

Total

Consumer finance - automobiles:

Credit rating

Very good

$

9,080

$

13,972

$

11,117

$

3,764

$

866

$

232

$

—

$

—

$

39,031

Good

11,947

33,653

39,081

13,875

2,806

1,014

—

—

102,376

Fairly good

12,408

42,347

50,225

23,953

5,272

4,227

—

—

138,432

Fair

6,702

27,277

33,698

19,558

6,086

5,275

—

—

98,596

Marginal

1,489

5,980

8,042

6,980

2,828

3,526

—

—

28,845

Total

$

41,626

$

123,229

$

142,163

$

68,130

$

17,858

$

14,274

$

—

$

—

$

407,280

Consumer finance - marine and recreational vehicles:

Credit rating

Very good

$

3,529

$

7,171

$

14,336

$

9,388

$

9,454

$

4,650

$

—

$

—

$

48,528

Good

996

7,139

7,895

1,553

1,301

835

—

—

19,719

Fairly good

—

256

219

36

29

36

—

—

576

Total

$

4,525

$

14,566

$

22,450

$

10,977

$

10,784

$

5,521

$

—

$

—

$

68,823

Total:

Credit rating

Very good

$

12,609

$

21,143

$

25,453

$

13,152

$

10,320

$

4,882

$

—

$

—

$

87,559

Good

12,943

40,792

46,976

15,428

4,107

1,849

—

—

122,095

Fairly good

12,408

42,603

50,444

23,989

5,301

4,263

—

—

139,008

Fair

6,702

27,277

33,698

19,558

6,086

5,275

—

—

98,596

Marginal

1,489

5,980

8,042

6,980

2,828

3,526

—

—

28,845

Total

$

46,151

$

137,795

$

164,613

$

79,107

$

28,642

$

19,795

$

—

$

—

$

476,103

The table below details the recorded balance of the classes of loans within the consumer finance loan portfolio by credit rating at the time of origination and year of origination as of December 31, 2023:


																							Revolving
		Term Loans Recorded Balance by Origination Year																					Loans
																				Revolving			Converted
(Dollars in thousands)		2023			2022			2021			2020			2019			Prior			Loans			to Term			Total
Consumer finance - automobiles:
Credit rating
Very good		$	14,916		$	12,395		$	4,291		$	1,012		$	277		$	22		$	—		$	—		$	32,913
Good			35,203			42,800			15,530			3,338			1,090			325			—			—			98,286
Fairly good			44,227			54,968			26,645			6,186			3,984			1,470			—			—			137,480
Fair			28,779			36,794			22,266			7,014			4,808			1,908			—			—			101,569
Marginal			6,359			8,956			7,715			3,322			2,832			1,844			—			—			31,028
Total		$	129,484		$	155,913		$	76,447		$	20,872		$	12,991		$	5,569		$	—		$	—		$	401,276

Consumer finance - marine and recreational vehicles:
Credit rating
Very good		$	7,481		$	15,000		$	9,857		$	9,952		$	2,518		$	2,438		$	—		$	—		$	47,246
Good			7,419			8,130			1,602			1,384			410			453			—			—			19,398
Fairly good			265			221			37			30			—			37			—			—			590
Total		$	15,165		$	23,351		$	11,496		$	11,366		$	2,928		$	2,928		$	—		$	—		$	67,234

Total:
Credit rating
Very good		$	22,397		$	27,395		$	14,148		$	10,964		$	2,795		$	2,460		$	—		$	—		$	80,159
Good			42,622			50,930			17,132			4,722			1,500			778			—			—			117,684
Fairly good			44,492			55,189			26,682			6,216			3,984			1,507			—			—			138,070
Fair			28,779			36,794			22,266			7,014			4,808			1,908			—			—			101,569
Marginal			6,359			8,956			7,715			3,322			2,832			1,844			—			—			31,028
Total		$	144,649		$	179,264		$	87,943		$	32,238		$	15,919		$	8,497		$	—		$	—		$	468,510

The following table details the current period gross charge-offs of loans by year of origination for the three months ended March 31, 2024:


																							Revolving
		Current Period Gross Charge-offs by Origination Year																					Loans
																				Revolving			Converted
(Dollars in thousands)		2024			2023			2022			2021			2020			Prior			Loans			to Term			Total
Residential mortgage		$	3		$	—		$	—		$	—		$	—		$	—		$	—		$	—		$	3
Other consumer¹			90			3			5			—			—			—			—			—			98
Consumer finance - automobiles			—			724			1,869			1,059			213			190			—			—			4,055
Consumer finance - marine and recreational vehicles			—			17			23			—			8			—			—			—			48
Total		$	93		$	744		$	1,897		$	1,059		$	221		$	190		$	—		$	—		$	4,204

1	Gross charge-offs of other consumer loans for the three months ended March 31, 2024 included $90,000 of demand deposit overdrafts that originated in 2024.

The following table details the current period gross charge-offs of loans by year of origination for the three months ended March 31, 2023:


																							Revolving
		Current Period Gross Charge-offs by Origination Year																					Loans
																				Revolving			Converted
(Dollars in thousands)		2023			2022			2021			2020			2019			Prior			Loans			to Term			Total
Commercial business		$	—		$	16		$	—		$	—		$	—		$	—		$	—		$	—		$	16
Construction - consumer real estate			—			—			—			—			—			—			8			—			8
Other consumer¹			81			—			—			—			—			—			—			—			81
Consumer finance - automobiles			—			1,384			938			320			135			285			—			—			3,062
Consumer finance - marine and recreational vehicles			—			46			—			—			—			—			—			—			46
Total		$	81		$	1,446		$	938		$	320		$	135		$	285		$	8		$	—		$	3,213

1	Gross charge-offs of other consumer loans for the three months ended March 31, 2023 included $81,000 of demand deposit overdrafts that originated in 2023.