XML 97 R15.htm IDEA: XBRL DOCUMENT

Note 4 - Loans

12 Months Ended

Dec. 31, 2024

Loans, Notes, Trade and Other Receivables, Excluding Allowance for Credit Losses [Text Block]

Note 4. Loans

Loans at December 31, 2024 and 2023 are summarized as follows (in thousands):

	2024			2023
Real estate loans:
Construction and land development	$	84,480		$	52,680
Secured by 1-4 family residential		547,167			344,369
Other real estate		672,162			447,272
Commercial and industrial loans		141,333			113,074
Consumer and other loans		21,453			12,035
Total loans, net of deferred origination costs/fees	$	1,466,595		$	969,430
Allowance for credit losses		(16,400	)		(11,974	)
Loans, net	$	1,450,195		$	957,456

Net deferred loan fees included in the above loan categories were $1.3 million and $1.1 million at December 31, 2024 and 2023, respectively. Net unamortized discounts on loans acquired through business combinations included in the above loan categories totaled $14.3 million at December 31, 2024 and $1.9 million at December 31, 2023. Unamortized premiums on loans purchased from a third-party loan originator are included in the commercial and industrial loan categories and totaled $5.8 million as of December 31, 2024 and $7.9 million as of December 31, 2023. Consumer and other loans included $450 thousand and $222 thousand of demand deposit overdrafts at December 31, 2024 and 2023, respectively.

The following tables provide a summary of loan classes and an aging of past due loans as of December 31, 2024 and 2023 (in thousands):

	December 31, 2024
	30-59 Days Past Due		60-89 Days Past Due		>90 Days Past Due		Total Past Due		Current		Total Loans		Non-Accrual Loans		90 Days or More Past Due and Accruing
Real estate loans:
Construction and land development	$	56	$	26	$	23	$	105	$	84,375	$	84,480	$	50	$	23
1-4 family residential		2,192		210		54		2,456		544,711		547,167		2,148		54
Other real estate		12		41		—		53		672,109		672,162		—		—
Commercial and industrial		145		373		288		806		140,527		141,333		4,773		288
Consumer and other loans		31		—		—		31		21,422		21,453		—		—
Total	$	2,436	$	650	$	365	$	3,451	$	1,463,144	$	1,466,595	$	6,971	$	365

	December 31, 2023
	30-59 Days Past Due		60-89 Days Past Due		>90 Days Past Due		Total Past Due		Current		Total Loans		Non-Accrual Loans		90 Days or More Past Due and Accruing
Real estate loans:
Construction and land development	$	183	$	4	$	38	$	225	$	52,455	$	52,680	$	38	$	—
1-4 family residential		1,364		350		392		2,106		342,263		344,369		495		245
Other real estate		—		—		82		82		447,190		447,272		—		82
Commercial and industrial		252		316		197		765		112,309		113,074		6,230		197
Consumer and other loans		33		—		—		33		12,002		12,035		—		—
Total	$	1,832	$	670	$	709	$	3,211	$	966,219	$	969,430	$	6,763	$	524

Loans acquired in business combinations are recorded in the Consolidated Balance Sheets at fair value at the acquisition date under the acquisition method of accounting. The outstanding principal balance and the carrying amount at December 31, 2024 and 2023 of loans acquired in business combinations were as follows:

	Acquired Loans - Purchased Performing
(Dollars in thousands)	2024		2023
Outstanding principal balance	$	603,046	$	164,028

Carrying amount
Real estate loans:
Construction and land development	$	15,810	$	7,851
Secured by 1-4 family residential		234,004		36,290
Other real estate loans		291,805		94,882
Commercial and industrial loans		40,885		19,611
Consumer and other loans		6,268		3,451
Total acquired loans	$	588,772	$	162,085

The following table presents additional information related to the acquired Touchstone loan portfolio at the acquisition date, including the initial ACL at acquisition on the PCD loans (in thousands):


PCD Loans:	2024
Book value of acquired loans at acquisition	$	13,050
Initial ACL at acquisition		386
Non-credit discount at acquisition		1,413
Purchase Price	$	14,849
Non-PCD Loans:
Fair Value	$	467,891
Gross contractual amounts receivable	$	479,591
Estimate of contractual cash flows not expected to be collected	$	8,138

There were no PCD loans at December 31, 2023.

Credit Quality Indicators

As part of the ongoing monitoring of the credit quality of the Company’s loan portfolio, management tracks certain credit quality indicators including trends related to the risk grading of specified classes of loans. The Company utilizes a risk grading matrix to assign a rating to each of its loans. The loan ratings are summarized into the following categories: pass, special mention, substandard, doubtful, and loss. Pass rated loans include all risk rated credits other than those included in special mention, substandard, or doubtful. Loans classified as loss are charged-off. Loan officers assign risk grades to loans at origination and as renewals arise. The Bank’s Credit Administration department reviews risk grades for accuracy on a quarterly basis and as credit issues arise. In addition, a certain amount of loans are reviewed each year through the Company’s internal and external loan review process. A description of the general characteristics of the loan grading categories is as follows:

Pass – Loans classified as pass exhibit acceptable operating trends, balance sheet trends, and liquidity. Sufficient cash flow exists to service the loan. All obligations have been paid by the borrower as agreed.

Special Mention – Loans classified as special mention have a potential weakness that deserves management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or the Bank’s credit position at some future date.

Substandard – Loans classified as substandard are inadequately protected by the current net worth and payment capacity of the obligor or of the collateral pledged, if any. Loans so classified have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the Bank will sustain some loss if the deficiencies are not corrected.

Doubtful – Loans classified as doubtful have all the weaknesses inherent in those classified as substandard, with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions, and values, highly questionable and improbable. The Company considers all doubtful loans to be impaired and places the loan on non-accrual status.

Loss – Loans classified as loss are considered uncollectable and of such little value that their continuance as bankable assets is not warranted.

The following table presents the Company's recorded investment in loans by credit quality indicators by year of origination as of December 31, 2024 (in thousands).

	December 31, 2024
	Term Loans by Year of Origination
	2024		2023		2022		2021		2020		Prior		Revolving		Total
Construction and land development
Pass	$	4,419	$	5,401	$	2,421	$	5,811	$	4,424	$	5,419	$	56,509	$	84,404
Special Mention		26		—		—		—		—		—		—		26
Substandard		—		—		—		18		—		32		—		50
Doubtful		—		—		—		—		—		—		—		—
Total Construction and land development	$	4,445	$	5,401	$	2,421	$	5,829	$	4,424	$	5,451	$	56,509	$	84,480

Current period gross write-offs	$	—	$	—	$	—	$	—	$	—	$	4	$	—	$	4

Secured by 1-4 family residential
Pass	$	32,609	$	69,884	$	113,535	$	99,470	$	49,250	$	115,032	$	64,740	$	544,520
Special Mention		120		—		—		—		—		83		—		203
Substandard		—		32		252		317				1,843		—		2,444
Doubtful		—		—		—		—		—		—		—		—
Total Secured by 1-4 family residential	$	32,729	$	69,916	$	113,787	$	99,787	$	49,250	$	116,958	$	64,740	$	547,167

Current period gross write-offs	$	20	$	—	$	—	$	—	$	—	$	18	$	—	$	38

Other real estate loans
Pass	$	64,958	$	83,725	$	142,077	$	120,012	$	48,238	$	192,869	$	15,531	$	667,410
Special Mention		318		—		—		—		—		4,072		—		4,390
Substandard		—		—		—		—		—		362		—		362
Doubtful		—		—		—		—		—		—		—		—
Total Other real estate loans	$	65,276	$	83,725	$	142,077	$	120,012	$	48,238	$	197,303	$	15,531	$	672,162

Current period gross write-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

Commercial and industrial
Pass	$	24,270	$	24,835	$	21,819	$	23,086	$	3,583	$	12,815	$	22,627	$	133,035
Special Mention		430		—		1,211		—		—		513		—		2,154
Substandard		615		737		3,699		647				446		—		6,144
Doubtful		—		—		—		—		—		—		—		—
Total Commercial and industrial	$	25,315	$	25,572	$	26,729	$	23,733	$	3,583	$	13,774	$	22,627	$	141,333

Current period gross write-offs	$	110	$	1,275	$	772	$	1,519	$	20	$	3	$	—	$	3,699

Consumer and other loans
Pass	$	5,129	$	1,697	$	1,437	$	130	$	1,306	$	2,566	$	8,917	$	21,182
Special Mention		—		270		—		—		—		—		—		270
Substandard		—		—		—		—		—		1		—		1
Doubtful		—		—		—		—		—		—		—		—
Total Consumer and other loans	$	5,129	$	1,967	$	1,437	$	130	$	1,306	$	2,567	$	8,917	$	21,453

Current period gross write-offs	$	249	$	29	$	9	$	3	$	1	$	2	$	—	$	293

The following table presents the Company's recorded investment in loans by credit quality indicators by year of origination as of

December 31, 2023

(in thousands).

	December 31, 2023
	Term Loans by Year of Origination
	2024		2023		2022		2021		2020		Prior		Revolving		Total
Construction and land development
Pass	$	2,477	$	2,925	$	4,350	$	3,450	$	2,085	$	2,859	$	34,496	$	52,642
Special Mention		—		—		—		—		—		—		—		—
Substandard		—		—		—		—		—		38		—		38
Doubtful		—		—		—		—		—		—		—		—
Total Construction and land development	$	2,477	$	2,925	$	4,350	$	3,450	$	2,085	$	2,897	$	34,496	$	52,680

Current period gross write-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

Secured by 1-4 family residential
Pass	$	43,029	$	77,196	$	64,063	$	41,192	$	31,509	$	76,295	$	10,303	$	343,587
Special Mention		—		—		—		—		—		—		—		—
Substandard		—		98		19		—		—		665		—		782
Doubtful		—		—		—		—		—		—		—		—
Total Secured by 1-4 family residential	$	43,029	$	77,294	$	64,082	$	41,192	$	31,509	$	76,960	$	10,303	$	344,369

Current period gross write-offs	$	—	$	59	$	—	$	—	$	—	$	—	$	—	$	59

Other real estate loans
Pass	$	51,560	$	94,666	$	90,089	$	41,186	$	36,747	$	122,755	$	10,269	$	447,272
Special Mention		—		—		—		—		—		—		—		—
Substandard		—		—		—		—		—		—		—		—
Doubtful		—		—		—		—		—		—		—		—
Total Other real estate loans	$	51,560	$	94,666	$	90,089	$	41,186	$	36,747	$	122,755	$	10,269	$	447,272

Current period gross write-offs	$	—	$	—	$	—	$	—	$	—	$	34	$	—	$	34

Commercial and industrial
Pass	$	22,086	$	26,755	$	20,352	$	4,102	$	4,448	$	8,276	$	20,825	$	106,844
Special Mention		—		—		—		—		—		—		—		—
Substandard		58		3,757		1,453		—		167		795		—		6,230
Doubtful		—		—		—		—		—		—		—		—
Total Commercial and industrial	$	22,144	$	30,512	$	21,805	$	4,102	$	4,615	$	9,071	$	20,825	$	113,074

Current period gross write-offs	$	315	$	1,121	$	1,139	$	624	$	—	$	253	$	—	$	3,452

Consumer and other loans
Pass	$	3,021	$	1,203	$	311	$	1,471	$	2,172	$	14	$	3,843	$	12,035
Special Mention		—		—		—		—		—		—		—		—
Substandard		—		—		—		—		—		—		—		—
Doubtful		—		—		—		—		—		—		—		—
Total Consumer and other loans	$	3,021	$	1,203	$	311	$	1,471	$	2,172	$	14	$	3,843	$	12,035

Current period gross write-offs	$	366	$	57	$	4	$	15	$	3	$	3	$	—	$	448