Troubled Debt Restructurings

6 Months Ended

Jun. 30, 2023

Restructurings for Borrowers Experiencing Financial Difficulty

NOTE 6. Restructurings for Borrowers Experiencing Financial Difficulty

The Company adopted the amendments in ASU 2022-02, which eliminated accounting guidance on TDR loans for creditors and requires enhanced disclosures for loan modifications to borrowers experiencing financial difficulty that we made on or after January 1, 2023.

The following table presents the amortized cost of loans that were modified during the six months ended June 30, 2023 by loan portfolio segment:


	June 30, 2023
	(in thousands)
	Term Extension		Total		% of Total Class of Loans
Mortgage real estate loans:
Residential First Lien - Owner Occupied	$	355	$	355		0.25	%
Total	$	355	$	355

None of the loans that were modified defaulted during the six months ended June 30, 2023 and the loans remain current with contractual payments as of June 30, 2023. The financial effects of the term extensions during the period added a weighted average of 1.0 years to the life of loans which reduced the payment amounts for the borrowers.

There were no loans to borrowers experiencing financial difficulty that were modified during the three months ended June 30, 2023.

Prior to the adoption of ASU 2022-02, the Company accounted for a modification to the contractual terms of a loan that resulting in granting a concession to a borrower experiencing financial dificulties as a TDR.

During the three and six months ended June 30, 2022, the Company classified five loans as troubled debt restructurings.


	Three Months Ended
	June 30, 2022
	(in thousands)
	Number of Contracts		Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment
Commercial Real Estate:
Owner Occupied		1	$	185	$	185
Construction and Farmland:
Residential		1		639		639
Residential:
Single Family		3		539		557
Total		5	$	1,363		1,381

	Six Months Ended
	June 30, 2022
	(in thousands)
	Number of Contracts		Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment
Commercial Real Estate:
Owner Occupied		1	$	185	$	185
Construction and Farmland:
Residential		1		639		639
Residential:
Single family		3		539		557
Total		5	$	1,363	$	1,381

There were no payment defaults during the three and six months ended June 30, 2022 for TDRs that were restructured within the preceding twelve-month period.

Management defines default as over 30 days contractually past due under the modified terms, the foreclosure and/or repossession of the collateral, or the charge-off of the loan during the twelve-month period subsequent to the modification.