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Loans | 12 Months Ended
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Dec. 31, 2025
Receivables [Abstract] |
Loans | Loans and Allowance for Credit Losses Categories of loans include:
|  | December 31,
|  | 2025 |  | 2024
Commercial loans |  |  |  |
Commercial and industrial |  | $ | 221,714 |  |  | $ | 120,175 |
Owner-occupied commercial real estate |  | 48,575 |  |  | 53,591 |
Investor commercial real estate |  | 647,394 |  |  | 269,431 |
Construction |  | 372,668 |  |  | 413,523 |
Single tenant lease financing |  | 222,925 |  |  | 949,748 |
Public finance |  | 442,234 |  |  | 485,867 |
Healthcare finance |  | 139,469 |  |  | 181,427 |
Small business lending 1 |  | 430,024 |  |  | 331,914 |
Franchise finance |  | 417,045 |  |  | 536,909 |
Total commercial loans |  | 2,942,048 |  |  | 3,342,585 |
Consumer loans |  |  |  |
Residential mortgage |  | 343,110 |  |  | 375,160 |
Home equity |  | 14,725 |  |  | 18,274 |
Other consumer |  | 425,458 |  |  | 407,947 |
Total consumer loans |  | 783,293 |  |  | 801,381 |
Total commercial and consumer loans |  | 3,725,341 |  |  | 4,143,966 |
Net deferred loan origination costs, premiums and discounts on purchased loans, and other 2 |  | 21,387 |  |  | 26,680 |
Total loans |  | 3,746,728 |  |  | 4,170,646 |
Allowance for credit losses |  | (55,686) |  |  | (44,769) |
Net loans |  | $ | 3,691,042 |  |  | $ | 4,125,877 |
1 Balances include $52.2 million and $34.0 million that are guaranteed by the U.S. government as of December 31, 2025 and December 31, 2024, respectively. 2 Includes carrying value adjustment of $19.1 million and $22.9 million related to terminated interest rate swaps associated with public finance loans as of December 31, 2025 and December 31, 2024, respectively. During the twelve months ended December 31, 2025, the Company sold a total of $851.2 million of single tenant lease financing loans from which the Company recognized a pre-tax loss on sale of $38.2 million recorded within non-interest income. The transaction was executed as part of an initiative to strengthen the Company’s regulatory capital ratios and improve its interest rate risk position. Unrelated to this transaction, the Company also sold $35.0 million of single tenant lease financing loans which resulted in a gain on sale of $0.3 million recorded within non-interest income. The general risk characteristics specific to each loan portfolio segment are as follows: Commercial and Industrial: Commercial and industrial loans’ sources of repayment are primarily based on the identified cash flows of the borrower and secondarily on the underlying collateral provided by the borrower. The cash flows of borrowers, however, may not be as expected, and the collateral securing these loans may fluctuate in value. Loans are made for working capital, equipment purchases, or other purposes. Most commercial and industrial loans are secured by the assets being financed and may incorporate a personal guarantee. This portfolio segment is generally concentrated in the Midwest and Southwest regions of the United States. Owner-Occupied Commercial Real Estate: The primary source of repayment is the cash flow from the ongoing operations and activities conducted by the borrower, or an affiliate of the borrower, who owns the property. This portfolio segment is generally concentrated in the Midwest and Southwest regions of the United States and its loans are often secured by manufacturing and service facilities. Investor Commercial Real Estate: These loans are made on a nationwide basis and are underwritten primarily based on the cash flow expected to be generated from the property and are secondarily supported by the value of the real estate. These loans typically incorporate a personal guarantee from the primary sponsor or sponsors. This portfolio segment generally involves larger loan amounts with repayment primarily dependent on the successful leasing and operation of the property securing the loan or the business conducted on the property securing the loan. Investor commercial real estate loans may be more adversely affected by changing economic conditions in the real estate markets, industry dynamics or the overall health of the local economy where the property is located. The properties securing the Company’s investor commercial real estate portfolio tend to be diverse in terms of property type. Management monitors and evaluates commercial real estate loans based on property financial performance, collateral value, guarantor strength, economic and industry conditions together with other risk grade criteria. As a general rule, the Company avoids financing special use projects unless other underwriting factors are present to mitigate these additional risks. Construction: Construction loans are made on a nationwide basis and are secured by land and related improvements and are made to assist in the construction of new structures, which may include commercial (retail, industrial, office, and multi-family) properties, land development for residential properties or single family residential properties offered for sale by the builder. These loans generally finance a variety of project costs, including land, site preparation, architectural services, construction, closing and soft costs and interim financing needs. The cash flows of builders, while initially predictable, may fluctuate with market conditions, and the value of the collateral securing these loans may be subject to fluctuations based on general economic changes. Single Tenant Lease Financing: These loans are made on a nationwide basis to owners of real estate subject to long-term lease arrangements with single tenant operators. The real estate is typically operated by regionally, nationally or globally branded businesses. The loans are underwritten based on the financial strength of the borrower, characteristics of the real estate, cash flows generated from the lease arrangements and the financial strength of the tenant. Similar to the other loan portfolio segments, management monitors and evaluates these loans based on borrower and tenant financial performance, collateral value, industry trends and other risk grade criteria. Public Finance: These loans are made on a nationwide basis to governmental and not-for-profit entities to provide both tax-exempt and taxable loans for a variety of purposes including: short-term cash-flow needs; debt refinancing; economic development; quality of life projects; infrastructure improvements; renewable energy projects; and equipment financing. The primary sources of repayment for public finance loans include pledged revenue sources including, but not limited to: general obligations; property taxes; income taxes; tax increment revenue; utility revenue; gaming revenues; sales tax; and pledged general revenue. Certain loans may also include an additional collateral pledge of mortgaged property or a security interest in financed equipment. Healthcare Finance: These loans are made on a nationwide basis to healthcare providers, primarily dentists, for practice acquisition financing or refinancing that occasionally includes owner-occupied commercial real estate and equipment purchases. The sources of repayment are primarily based on the identified cash flows from operations of the borrower and related entities and secondarily on the underlying collateral provided by the borrower. Small Business Lending: These loans are made on a nationwide basis to small businesses and generally carry a partial guaranty from the U.S. Small Business Administration (“SBA”) under its 7(a) loan program. We generally sell the government guaranteed portion of SBA loans into the secondary market while retaining the non-guaranteed portion of the loan and the servicing rights. Loans in the small business lending portfolio have sources of repayment that are primarily based on the identified cash flows of the borrower and secondarily on any underlying collateral provided by the borrower. Loans may, but do not always, have a collateral shortfall. For SBA loans where the guaranteed portion is retained, the SBA guaranty provides a tertiary source of repayment to the Bank in event of borrower default. Cash flows of borrowers, however, may not be as expected and collateral securing these loans may fluctuate in value. Loans are made for a broad array of purposes including, but not limited to, providing operating cash flow, funding ownership changes, and facilitating equipment and commercial real estate purchases. Franchise Finance: These loans are made on a nationwide basis through our partnership with ApplePie Capital, which through their deep relationships with franchise brands provides franchisees with financing options for new franchise units, recapitalization, expansion, equipment and working capital. The sources of repayment are either based on identified cash flows from existing operations of the borrower or pro forma cash flow for new franchise locations. Residential Mortgage: Residential mortgage loans are secured by one‑to‑four family residential properties, which are generally owner‑occupied. The Company establishes maximum loan‑to‑value ratios and requires private mortgage insurance when those thresholds are exceeded. Repayment performance is primarily dependent on the financial condition of the borrowers and may be adversely affected by broader economic factors, including employment conditions and changes in residential real estate values. While the portfolio is concentrated within the Company’s primary market area, risk is mitigated by the relatively small size of individual loans and the dispersion of borrowers across the residential communities served. Home Equity: Home equity loans and lines of credit are typically secured by a subordinate lien on one‑to‑four family residential properties. Repayment is primarily dependent upon the borrowers’ financial capacity and may be adversely affected by unemployment levels, changes in residential property values, and other economic conditions within the relevant market areas. Although the Company has historically offered these products on a nationwide basis, credit risk is evaluated based on borrower characteristics, collateral valuation, and lien position. Other Consumer: These loans primarily consist of secured consumer credit products, including loans collateralized by horse trailers or recreational vehicles. Some other consumer loans also includes credit cards and unsecured loans, such as small installment loans, home improvement loans and certain lines of credit. Repayment performance is dependent on borrowers’ personal income and overall financial condition, which may be adversely affected by economic factors such as unemployment levels and broader market conditions. Risk is partially mitigated by the presence of collateral, the relatively small loan size and broad distribution of individual exposures across the markets served. ACL Methodology The ACL for loans represents management's estimate of all expected credit losses over the expected life of the Company’s existing loan portfolio. Management estimates the ACL balance using relevant available information about the collectability of cash flows, from internal and external sources, including historical information relating to past events, current conditions, and reasonable and supportable forecasts of future economic conditions. When the Company is unable to forecast future economic events, management may revert to historical information. The Company's methodologies incorporate a one-year reasonable and supportable forecast period with a one-year straight line reversion to the long-term historical average for most segments. The ACL methodology may also consider other adjustments to address changes in conditions, trends, and circumstances such as local industry changes that could have a significant impact on the risk profile of the loan portfolio and provide for adjustments that may not be reflected and/or captured in the historical loss data. These factors include: lending policies, imprecision in forecasting future economic conditions, loan profile, lending staff, problem loan trends, loan review, collateral, credit concentration, or other internal and external factors. The Company includes these as qualitative adjustments to the ACL which include, but are not limited to: •Changes in lending policies and procedures, including changes in underwriting standards and collections, charge-offs and recovery practices •Changes in international, national, regional and local economic conditions •Changes in the nature and volume of the portfolio and terms of loans •Changes in the experience, depth and ability of lending management •Changes in the volume and severity of past due loans and other similar conditions •Changes in the quality of the Company’s loan review system •Changes in the value of underlying collateral for collateral dependent loans •The existence and effect of any concentrations of credit and changes in the levels of such concentrations •The effect of other external factors (e.g. competition, legal and regulatory requirements) on the level of estimated credit losses The ACL is measured on a collective or pool basis when similar risk characteristics exist. The Company segments its portfolio generally by Federal Financial Institutions Examination Council ("FFIEC") Call Report codes that align with its lines of business. Additional sub-segmentation has not been utilized to identify groups of loans with unique risk characteristics relative to the rest of the portfolio. Loans that do not share similar risk characteristics are evaluated on an individual basis. These evaluations are typically performed on loans with a deteriorated internal risk rating. The ACL is determined based on several methods, including estimating the fair value of the underlying collateral or the present value of expected cash flows. The Company relies on a third-party platform that offers multiple methodologies to measure historical life-of-loan losses. Modified Loans to Borrowers Experiencing Financial Difficulty The Company may make modifications to certain loans in order to alleviate temporary difficulties in the borrower’s financial condition and/or constraints on the borrower’s ability to repay the loan, and to minimize potential losses to the Company. Modifications may include changes in the amortization terms of the loan, other-than-insignificant payment delays, reductions in interest rates, acceptance of interest only payments, and/or reductions to the outstanding loan balance. Such loans may be placed on nonaccrual status when there is doubt concerning the full repayment of principal and interest or the loan has been delinquent for a period of 90 days or more. These loans may be returned to accrual status when all contractual amounts past due have been brought current, and the borrower’s performance under the modified terms of the loan agreement and the ultimate collectability of all contractual amounts due under the modified terms is no longer in doubt. The Company typically measures the ACL on modified loans to borrowers experiencing financial difficulty on an individual basis when the loans are deemed to no longer share risk characteristics that are similar with other loans in the portfolio. The calculation of the ACL for these loans is based on a discounted cash flow approach for both those measured collectively and individually, unless the loan is deemed collateral dependent, which requires measurement of the ACL based on the estimated expected fair value of the underlying collateral, less costs to sell. GAAP requires the Company to make certain disclosures related to these loans, including certain types of modifications, as well as how such loans have performed since their modifications. Provision for Credit Losses A provision for estimated losses on loans is charged to income based upon management’s evaluation of the potential losses. Such an evaluation, which includes a review of all loans for which full repayment may not be reasonably assured, considers, among other matters, the estimated net realizable value of the underlying collateral, as applicable, economic conditions, loan loss experience, and other factors that are particularly susceptible to changes that could result in a material adjustment in the near term. While management attempts to use the best information available in making its evaluations, future ACL adjustments may be necessary if conditions change substantially from the assumptions used in making the evaluations. Policy for Charging Off Loans The Company’s policy is to charge off a loan at any point in time when it no longer can be considered a bankable asset, meaning collectible within the parameters of policy. A secured loan is generally charged down to the estimated fair value of the collateral, less costs to sell, no later than when it is 120 days past due as to principal or interest. An unsecured loan generally is charged off no later than when it is 180 days past due as to principal or interest. A home improvement loan generally is charged off no later than when it is 90 days past due as to principal or interest. The following tables present changes in the balance of the ACL during the twelve months ended December 31, 2025, 2024 and 2023, respectively.
|  | Twelve Months Ended December 31, 2025
Allowance for credit losses: |  | Balance, Beginning of Period |  |  |  | Provision (Credit) Charged to Expense |  | Charge-Offs |  | Recoveries |  | Balance, End of Period
Commercial and industrial |  | $ | 1,265 |  |  |  |  | $ | 809 |  |  | $ | (153) |  |  | $ | 21 |  |  | $ | 1,942 |
Owner-occupied commercial real estate |  | 528 |  |  |  |  | (264) |  |  | — |  |  | — |  |  | 264 |
Investor commercial real estate |  | 1,149 |  |  |  |  | 1,106 |  |  | — |  |  | — |  |  | 2,255 |
Construction |  | 1,984 |  |  |  |  | 462 |  |  | — |  |  | — |  |  | 2,446 |
Single tenant lease financing |  | 4,782 |  |  |  |  | (3,966) |  |  | — |  |  | — |  |  | 816 |
Public finance |  | 703 |  |  |  |  | (292) |  |  | — |  |  | — |  |  | 411 |
Healthcare finance |  | 1,412 |  |  |  |  | (807) |  |  | — |  |  | — |  |  | 605 |
Small business lending |  | 16,161 |  |  |  |  | 49,604 |  |  | (39,650) |  |  | 1,681 |  |  | 27,796 |
Franchise finance |  | 8,976 |  |  |  |  | 26,712 |  |  | (21,754) |  |  | 94 |  |  | 14,028 |
Residential mortgage |  | 2,136 |  |  |  |  | 62 |  |  | (75) |  |  | 19 |  |  | 2,142 |
Home equity |  | 106 |  |  |  |  | (75) |  |  | — |  |  | 7 |  |  | 38 |
Other consumer |  | 5,567 |  |  |  |  | (1,430) |  |  | (1,457) |  |  | 263 |  |  | 2,943 |
Total |  | $ | 44,769 |  |  |  |  | $ | 71,921 |  |  | $ | (63,089) |  |  | $ | 2,085 |  |  | $ | 55,686 |
The ACL was established based on historical loss experience, current conditions, and reasonable and supportable economic forecasts. These inputs did not indicate emerging credit deterioration within the small business lending or franchise finance portfolios as of December 31, 2024. However, during 2025, credit performance in these portfolios declined at a pace that exceeded prior expectations, resulting in higher-than-anticipated charge‑offs. In response to the observed deterioration, the Company increased the allowance allocated to these loan segments and implemented more stringent underwriting and lending standards to address the heightened credit risk.
|  | Twelve Months Ended December 31, 2024
Allowance for credit losses: |  | Balance, Beginning of Period |  |  |  | (Credit) Provision Charged to Expense |  | Charge-Offs |  | Recoveries |  | Balance, End of Period
Commercial and industrial |  | $ | 2,185 |  |  |  |  | $ | (928) |  |  | $ | — |  |  | $ | 8 |  |  | $ | 1,265 |
Owner-occupied commercial real estate |  | 825 |  |  |  |  | (297) |  |  | — |  |  | — |  |  | 528 |
Investor commercial real estate |  | 1,311 |  |  |  |  | (162) |  |  | — |  |  | — |  |  | 1,149 |
Construction |  | 2,167 |  |  |  |  | (183) |  |  | — |  |  | — |  |  | 1,984 |
Single tenant lease financing |  | 8,129 |  |  |  |  | (3,152) |  |  | (195) |  |  | — |  |  | 4,782 |
Public finance |  | 1,372 |  |  |  |  | (669) |  |  | — |  |  | — |  |  | 703 |
Healthcare finance |  | 1,976 |  |  |  |  | (564) |  |  | — |  |  | — |  |  | 1,412 |
Small business lending |  | 6,532 |  |  |  |  | 19,745 |  |  | (10,441) |  |  | 325 |  |  | 16,161 |
Franchise finance |  | 6,363 |  |  |  |  | 4,079 |  |  | (1,466) |  |  | — |  |  | 8,976 |
Residential mortgage |  | 2,054 |  |  |  |  | 240 |  |  | (159) |  |  | 1 |  |  | 2,136 |
Home equity |  | 171 |  |  |  |  | (72) |  |  | — |  |  | 7 |  |  | 106 |
Other consumer |  | 5,689 |  |  |  |  | 778 |  |  | (1,009) |  |  | 109 |  |  | 5,567 |
Total |  | $ | 38,774 |  |  |  |  | $ | 18,815 |  |  | $ | (13,270) |  |  | $ | 450 |  |  | $ | 44,769 |
|  | Twelve Months Ended December 31, 2023
Allowance for credit losses: |  | Balance, Beginning of Period |  |  |  | Adoption of CECL |  | Provision (Credit) Charged to Expense |  | Losses Charged Off |  | Recoveries |  | Balance, End of Period
Commercial and industrial |  | $ | 1,711 |  |  |  |  | $ | (120) |  |  | $ | 7,400 |  |  | $ | (7,049) |  |  | $ | 243 |  |  | $ | 2,185 |
Owner-occupied commercial real estate |  | 651 |  |  |  |  | 62 |  |  | 112 |  |  | — |  |  | — |  |  | 825 |
Investor commercial real estate |  | 1,099 |  |  |  |  | (191) |  |  | 994 |  |  | (591) |  |  | — |  |  | 1,311 |
Construction |  | 2,074 |  |  |  |  | (435) |  |  | 528 |  |  | — |  |  | — |  |  | 2,167 |
Single tenant lease financing |  | 10,519 |  |  |  |  | (346) |  |  | (2,044) |  |  | — |  |  | — |  |  | 8,129 |
Public finance |  | 1,753 |  |  |  |  | (135) |  |  | (246) |  |  | — |  |  | — |  |  | 1,372 |
Healthcare finance |  | 2,997 |  |  |  |  | 1,034 |  |  | (1,450) |  |  | (605) |  |  | — |  |  | 1,976 |
Small business lending |  | 2,168 |  |  |  |  | 334 |  |  | 6,539 |  |  | (2,586) |  |  | 77 |  |  | 6,532 |
Franchise finance |  | 3,988 |  |  |  |  | (313) |  |  | 3,019 |  |  | (331) |  |  | — |  |  | 6,363 |
Residential mortgage |  | 1,559 |  |  |  |  | 406 |  |  | 224 |  |  | (140) |  |  | 5 |  |  | 2,054 |
Home equity |  | 69 |  |  |  |  | 133 |  |  | (37) |  |  | — |  |  | 6 |  |  | 171 |
Other consumer |  | 3,149 |  |  |  |  | 2,533 |  |  | 415 |  |  | (582) |  |  | 174 |  |  | 5,689 |
Total |  | $ | 31,737 |  |  |  |  | $ | 2,962 |  |  | $ | 15,454 |  |  | $ | (11,884) |  |  | $ | 505 |  |  | $ | 38,774 |
Accrued interest receivable on loans totaled $23.1 million and $23.8 million at December 31, 2025 and December 31, 2024, respectively, and is excluded from the estimate of credit losses. The Company made the accounting policy election to not measure an ACL for accrued interest receivable. Accrued interest deemed uncollectible will be written off through interest income. In addition to the ACL, the Company maintains a reserve for off-balance sheet commitments, classified in other liabilities. This reserve is at a level management believes to be sufficient to absorb losses arising from unfunded loan commitments. The adequacy of the reserve for unfunded commitments is determined quarterly based on methodology similar to the methodology for determining the ACL. The following tables details activity in the provision for credit losses on off-balance sheet commitments for the twelve months ended December 31, 2025, 2024 and 2023.
|  | Balance December 31, 2024 |  | (Benefit) Provision for Credit Losses |  | Balance December 31, 2025
Off-balance sheet commitments |  |  |  |  |  |
Commercial loans |  |  |  |  |  |
Commercial and industrial |  | $ | 233 |  |  | $ | (56) |  |  | $ | 177 |
Owner-occupied commercial real estate |  | 11 |  |  | (11) |  |  | — |
Investor commercial real estate |  | 1 |  |  | 35 |  |  | 36 |
Construction |  | 1,568 |  |  | 691 |  |  | 2,259 |
Single tenant lease financing |  | 19 |  |  | (18) |  |  | 1 |
Small business lending |  | 263 |  |  | (151) |  |  | 112 |
Total commercial loans |  | 2,095 |  |  | 490 |  |  | 2,585 |
Consumer loans |  |  |  |  |  |
Residential mortgage |  | 1 |  |  | (1) |  |  | — |
Home equity |  | 35 |  |  | (35) |  |  | — |
Other consumer |  | 8 |  |  | (8) |  |  | — |
Total consumer loans |  | 44 |  |  | (44) |  |  | — |
Total allowance for off-balance sheet commitments |  | $ | 2,139 |  |  | $ | 446 |  |  | $ | 2,585 |
|  | Balance December 31, 2023 |  | Provision (Benefit) for Credit Losses |  | Balance December 31, 2024
Off-balance sheet commitments |  |  |  |  |  |
Commercial loans |  |  |  |  |  |
Commercial and industrial |  | $ | 233 |  |  | $ | — |  |  | $ | 233 |
Owner-occupied commercial real estate |  | 9 |  |  | 2 |  |  | 11 |
Investor commercial real estate |  | 6 |  |  | (5) |  |  | 1 |
Construction |  | 2,889 |  |  | (1,321) |  |  | 1,568 |
Single tenant lease financing |  | — |  |  | 19 |  |  | 19 |
Small business lending |  | 541 |  |  | (278) |  |  | 263 |
Total commercial loans |  | 3,678 |  |  | (1,583) |  |  | 2,095 |
Consumer loans |  |  |  |  |  |
Residential mortgage |  | 11 |  |  | (10) |  |  | 1 |
Home equity |  | 45 |  |  | (10) |  |  | 35 |
Other consumer |  | 11 |  |  | (3) |  |  | 8 |
Total consumer loans |  | 67 |  |  | (23) |  |  | 44 |
Total allowance for off-balance sheet commitments |  | $ | 3,745 |  |  | $ | (1,606) |  |  | $ | 2,139 |
|  | Pre-ASC 326 Adoption |  | Impact of ASC 326 Adoption |  | (Benefit) Provision for Credit Losses |  | Balance December 31, 2023
Off-balance sheet commitments |  |  |  |  |  |  |  |
Commercial loans |  |  |  |  |  |  |  |
Commercial and industrial |  | $ | — |  |  | $ | 110 |  |  | $ | 123 |  |  | $ | 233 |
Owner-occupied commercial real estate |  | — |  |  | — |  |  | 9 |  |  | 9 |
Investor commercial real estate |  | — |  |  | 9 |  |  | (3) |  |  | 6 |
Construction |  | — |  |  | 2,193 |  |  | 696 |  |  | 2,889 |
Healthcare finance |  | — |  |  | 2 |  |  | (2) |  |  | — |
Small business lending |  | — |  |  | — |  |  | 541 |  |  | 541 |
Total commercial loans |  |  |  | 2,314 |  |  | 1,364 |  |  | 3,678 |
Consumer loans |  |  |  |  |  |  |  |
Residential mortgage |  | — |  |  | 127 |  |  | (116) |  |  | 11 |
Home equity |  | — |  |  | 52 |  |  | (7) |  |  | 45 |
Other consumer |  | — |  |  | 11 |  |  | — |  |  | 11 |
Total consumer loans |  | — |  |  | 190 |  |  | (123) |  |  | 67 |
Total allowance for off-balance sheet commitments |  | $ | — |  |  | $ | 2,504 |  |  | $ | 1,241 |  |  | $ | 3,745 |
The Company utilizes a risk grading matrix to assign a risk grade to each of its commercial loans, which are evaluated on a continual basis. A description of the general characteristics of the risk grades is as follows: •“Pass” - Higher quality loans that do not fit any of the other categories described below. •“Special Mention” - Loans that possess some credit deficiency or potential weakness which deserve close attention. •“Substandard” - Loans that possess a defined weakness or weaknesses that jeopardize the liquidation of the debt. Loans that are characterized by the distinct possibility that the institution will sustain some loss if the deficiencies are not corrected. Loans that are inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged, if any. •“Doubtful” - Such loans have been placed on nonaccrual status and may be heavily dependent upon collateral possessing a value that is difficult to determine or based upon some near-term event which lacks clear certainty. These loans have all of the weaknesses of those classified as Substandard; however, based on existing conditions, these weaknesses make full collection of the principal balance highly improbable. The Company does not risk grade its consumer loans. It classifies them as either performing or nonperforming. Below is a description of those classifications: •“Performing” - Loans that are accruing and full collection of principal and interest is expected. •“Nonperforming” - Loans that are 90 days delinquent or for which the full collection of principal and interest may be in doubt. The following table presents the credit risk profile of the Company’s commercial and consumer loan portfolios by loan class and by year of origination for the years indicated based on rating category and payment activity as of December 31, 2025 and December 31, 2024
| December 31, 2025
| Term Loans (amortized cost basis by origination year) |  | Revolving loans amortized cost basis | Revolving loans converted to term |  |
| 2025 |  | 2024 |  | 2023 |  | 2022 |  | 2021 |  | Prior |  |  | Total
Commercial and industrial |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass | $ | 91,592 |  |  | $ | 18,608 |  |  | $ | 6,984 |  |  | $ | 10,450 |  |  | $ | 530 |  |  | $ | 14,152 |  |  | $ | 60,071 |  | $ | — |  |  | $ | 202,387 |
Special Mention | 177 |  |  | 256 |  |  | — |  |  | 4,746 |  |  | 4,237 |  |  | — |  |  | 9,671 |  | — |  |  | 19,087 |
Substandard | 64 |  |  | 38 |  |  | 138 |  |  | — |  |  | — |  |  | — |  |  | — |  | — |  |  | 240 |
Doubtful | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  | — |  |  | — |
Total commercial and industrial | 91,833 |  |  | 18,902 |  |  | 7,122 |  |  | 15,196 |  |  | 4,767 |  |  | 14,152 |  |  | 69,742 |  | — |  |  | 221,714 |
Year-to-date gross charge-offs | 94 |  |  | 59 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  | — |  |  | 153 |
Owner-occupied commercial real estate |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass | 4,159 |  |  | 6,202 |  |  | 1,421 |  |  | 5,174 |  |  | 4,155 |  |  | 15,966 |  |  | — |  | — |  |  | 37,077 |
Special Mention | — |  |  | — |  |  | — |  |  | — |  |  | 852 |  |  | 8,991 |  |  | — |  | — |  |  | 9,843 |
Substandard | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 1,655 |  |  | — |  | — |  |  | 1,655 |
Doubtful | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  | — |  |  | — |
Total owner-occupied commercial real estate | 4,159 |  |  | 6,202 |  |  | 1,421 |  |  | 5,174 |  |  | 5,007 |  |  | 26,612 |  |  | — |  | — |  |  | 48,575 |
Year-to-date gross charge-offs | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  | — |  |  | — |
Investor commercial real estate |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass | 61,333 |  |  | 80,798 |  |  | 195,528 |  |  | 179,155 |  |  | 91,708 |  |  | 35,141 |  |  | — |  | — |  |  | 643,663 |
Special Mention | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 3,731 |  |  | — |  | — |  |  | 3,731 |
Substandard | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  | — |  |  | — |
Doubtful | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  | — |  |  | — |
Total investor commercial real estate | 61,333 |  |  | 80,798 |  |  | 195,528 |  |  | 179,155 |  |  | 91,708 |  |  | 38,872 |  |  | — |  | — |  |  | 647,394 |
Year-to-date gross charge-offs | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  | — |  |  | — |
Construction |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass | 65,190 |  |  | 147,941 |  |  | 132,835 |  |  | 23,114 |  |  | — |  |  | 2,042 |  |  | 1,546 |  | — |  |  | 372,668 |
Special Mention | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  | — |  |  | — |
Substandard | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  | — |  |  | — |
Doubtful | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  | — |  |  | — |
Total construction | 65,190 |  |  | 147,941 |  |  | 132,835 |  |  | 23,114 |  |  | — |  |  | 2,042 |  |  | 1,546 |  | — |  |  | 372,668 |
Year-to-date gross charge-offs | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  | — |  |  | — |
Single tenant lease financing |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass | 144,764 |  |  | 1,370 |  |  | 1,007 |  |  | 10,377 |  |  | 2,021 |  |  | 29,524 |  |  | — |  | — |  |  | 189,063 |
Special Mention | — |  |  | — |  |  | — |  |  | 18,628 |  |  | 4,168 |  |  | 9,401 |  |  | — |  | — |  |  | 32,197 |
Substandard | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 1,665 |  |  | — |  | — |  |  | 1,665 |
Doubtful | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  | — |  |  | — |
Total single tenant lease financing | 144,764 |  |  | 1,370 |  |  | 1,007 |  |  | 29,005 |  |  | 6,189 |  |  | 40,590 |  |  | — |  | — |  |  | 222,925 |
Year-to-date gross charge-offs | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  | — |  |  | — |
Public finance |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass | 44,077 |  |  | 11,119 |  |  | — |  |  | 5,301 |  |  | 10,385 |  |  | 369,442 |  |  | — |  | — |  |  | 440,324 |
Special Mention | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 1,910 |  |  | — |  | — |  |  | 1,910 |
Substandard | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  | — |  |  | — |
Doubtful | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  | — |  |  | — |
Total public finance | 44,077 |  |  | 11,119 |  |  | — |  |  | 5,301 |  |  | 10,385 |  |  | 371,352 |  |  | — |  | — |  |  | 442,234 |
Year-to-date gross charge-offs | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  | — |  |  | — |
| December 31, 2025
| Term Loans (amortized cost basis by origination year) |  | Revolving loans amortized cost basis | Revolving loans converted to term |  |
| 2025 |  | 2024 |  | 2023 |  | 2022 |  | 2021 |  | Prior |  |  | Total
Healthcare finance |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass | — |  |  | — |  |  | — |  |  | — |  |  | 7,317 |  |  | 128,623 |  |  | — |  | — |  |  | 135,940 |
Special Mention | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 933 |  |  | — |  | — |  |  | 933 |
Substandard | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 2,596 |  |  | — |  | — |  |  | 2,596 |
Doubtful | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  | — |  |  | — |
Total healthcare finance | — |  |  | — |  |  | — |  |  | — |  |  | 7,317 |  |  | 132,152 |  |  | — |  | — |  |  | 139,469 |
Year-to-date gross charge-offs | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  | — |  |  | — |
Small business lending |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass | 152,566 |  |  | 103,270 |  |  | 62,754 |  |  | 21,651 |  |  | 7,851 |  |  | 13,779 |  |  | 27,048 |  | — |  |  | 388,919 |
Special Mention | — |  |  | 7,519 |  |  | 5,276 |  |  | 514 |  |  | — |  |  | 1,475 |  |  | 1,953 |  | — |  |  | 16,737 |
Substandard | — |  |  | 5,838 |  |  | 11,637 |  |  | 1,315 |  |  | 270 |  |  | 1,416 |  |  | 3,892 |  | — |  |  | 24,368 |
Doubtful | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  | — |  |  | — |
Total small business lending | 152,566 |  |  | 116,627 |  |  | 79,667 |  |  | 23,480 |  |  | 8,121 |  |  | 16,670 |  |  | 32,893 |  | — |  |  | 430,024 |
Year-to-date gross charge-offs | 400 |  |  | 16,668 |  |  | 17,755 |  |  | 2,821 |  |  | 1,087 |  |  | 919 |  |  | — |  | — |  |  | 39,650 |
Franchise finance |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass | 718 |  |  | 56,732 |  |  | 172,080 |  |  | 120,012 |  |  | 29,064 |  |  | — |  |  | — |  | — |  |  | 378,606 |
Special Mention | 510 |  |  | 628 |  |  | 3,351 |  |  | 6,972 |  |  | — |  |  | — |  |  | — |  | — |  |  | 11,461 |
Substandard | — |  |  | 1,281 |  |  | 6,831 |  |  | 10,877 |  |  | 7,989 |  |  | — |  |  | — |  | — |  |  | 26,978 |
Doubtful | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  | — |  |  | — |
Total franchise finance | 1,228 |  |  | 58,641 |  |  | 182,262 |  |  | 137,861 |  |  | 37,053 |  |  | — |  |  | — |  | — |  |  | 417,045 |
Year-to-date gross charge-offs | — |  |  | 370 |  |  | 7,664 |  |  | 9,576 |  |  | 4,144 |  |  | — |  |  | — |  | — |  |  | 21,754 |
Consumer loans |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Residential mortgage |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Performing | 4,770 |  |  | 6,271 |  |  | 10,901 |  |  | 163,760 |  |  | 78,631 |  |  | 73,883 |  |  | — |  | — |  |  | 338,216 |
Nonperforming | — |  |  | — |  |  | — |  |  | 2,721 |  |  | 597 |  |  | 1,576 |  |  | — |  | — |  |  | 4,894 |
Total residential mortgage | 4,770 |  |  | 6,271 |  |  | 10,901 |  |  | 166,481 |  |  | 79,228 |  |  | 75,459 |  |  | — |  | — |  |  | 343,110 |
Year-to-date gross charge-offs | — |  |  | — |  |  | — |  |  | 75 |  |  | — |  |  | — |  |  | — |  | — |  |  | 75 |
Home equity |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Performing | — |  |  | — |  |  | 628 |  |  | 1,009 |  |  | 187 |  |  | 761 |  |  | 11,330 |  | 810 |  |  | 14,725 |
Nonperforming | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  | — |  |  | — |
Total home equity | — |  |  | — |  |  | 628 |  |  | 1,009 |  |  | 187 |  |  | 761 |  |  | 11,330 |  | 810 |  |  | 14,725 |
Year-to-date gross charge-offs | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  | — |  |  | — |
Other consumer |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Performing | 98,688 |  |  | 85,148 |  |  | 77,999 |  |  | 72,978 |  |  | 26,284 |  |  | 63,224 |  |  | 903 |  | — |  |  | 425,224 |
Nonperforming | — |  |  | 96 |  |  | 84 |  |  | 9 |  |  | 34 |  |  | 11 |  |  | — |  | — |  |  | 234 |
Total other consumer | 98,688 |  |  | 85,244 |  |  | 78,083 |  |  | 72,987 |  |  | 26,318 |  |  | 63,235 |  |  | 903 |  | — |  |  | 425,458 |
Year-to-date gross charge-offs | 79 |  |  | 279 |  |  | 491 |  |  | 189 |  |  | 31 |  |  | 388 |  |  | — |  | — |  |  | 1,457 |
Total Loans | $ | 668,608 |  |  | $ | 533,115 |  |  | $ | 689,454 |  |  | $ | 658,763 |  |  | $ | 276,280 |  |  | $ | 781,897 |  |  | $ | 116,414 |  | $ | 810 |  |  | $ | 3,725,341 |
Total year-to-date gross charge-offs | $ | 573 |  |  | $ | 17,376 |  |  | $ | 25,910 |  |  | $ | 12,661 |  |  | $ | 5,262 |  |  | $ | 1,307 |  |  | $ | — |  | $ | — |  |  | $ | 63,089 |
| December 31, 2024
| Term Loans (amortized cost basis by origination year) |  | Revolving loans amortized cost basis | Revolving loans converted to term |  |
| 2024 |  | 2023 |  | 2022 |  | 2021 |  | 2020 |  | Prior |  |  | Total
Commercial and industrial |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass | $ | 23,539 |  |  | $ | 8,501 |  |  | $ | 13,853 |  |  | $ | 5,418 |  |  | $ | 2,362 |  |  | $ | 17,829 |  |  | $ | 44,000 |  | $ | — |  |  | $ | 115,502 |
Special Mention | 47 |  |  | 164 |  |  | 4,462 |  |  | — |  |  | — |  |  | — |  |  | — |  | — |  |  | 4,673 |
Substandard | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  | — |  |  | — |
Doubtful | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  | — |  |  | — |
Total Commercial and industrial | 23,586 |  |  | 8,665 |  |  | 18,315 |  |  | 5,418 |  |  | 2,362 |  |  | 17,829 |  |  | 44,000 |  | — |  |  | 120,175 |
Year-to-date gross charge-offs | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  | — |  |  | — |
Owner-occupied commercial real estate |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass | 7,410 |  |  | 1,458 |  |  | 5,366 |  |  | 6,438 |  |  | 5,716 |  |  | 14,793 |  |  | — |  | — |  |  | 41,181 |
Special Mention | — |  |  | — |  |  | 570 |  |  | 888 |  |  | 8,144 |  |  | 1,153 |  |  | — |  | — |  |  | 10,755 |
Substandard | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 1,655 |  |  | — |  | — |  |  | 1,655 |
Doubtful | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  | — |  |  | — |
Total owner-occupied commercial real estate | 7,410 |  |  | 1,458 |  |  | 5,936 |  |  | 7,326 |  |  | 13,860 |  |  | 17,601 |  |  | — |  | — |  |  | 53,591 |
Year-to-date gross charge-offs | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  | — |  |  | — |
Investor commercial real estate |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass | 71,430 |  |  | 3,849 |  |  | 88,290 |  |  | 65,050 |  |  | 9,607 |  |  | 27,474 |  |  | — |  | — |  |  | 265,700 |
Special Mention | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 3,731 |  |  | — |  | — |  |  | 3,731 |
Substandard | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  | — |  |  | — |
Doubtful | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  | — |  |  | — |
Total investor commercial real estate | 71,430 |  |  | 3,849 |  |  | 88,290 |  |  | 65,050 |  |  | 9,607 |  |  | 31,205 |  |  | — |  | — |  |  | 269,431 |
Year-to-date gross charge-offs | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  | — |  |  | — |
Construction |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass | 35,177 |  |  | 186,979 |  |  | 140,299 |  |  | 47,598 |  |  | 1,622 |  |  | — |  |  | 1,848 |  | — |  |  | 413,523 |
Special Mention | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  | — |  |  | — |
Substandard | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  | — |  |  | — |
Doubtful | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  | — |  |  | — |
Total construction | 35,177 |  |  | 186,979 |  |  | 140,299 |  |  | 47,598 |  |  | 1,622 |  |  | — |  |  | 1,848 |  | — |  |  | 413,523 |
Year-to-date gross charge-offs | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  | — |  |  | — |
Single tenant lease financing |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass | 79,872 |  |  | 46,674 |  |  | 211,005 |  |  | 88,192 |  |  | 63,506 |  |  | 437,564 |  |  | — |  | — |  |  | 926,813 |
Special Mention | 644 |  |  | — |  |  | 9,696 |  |  | 3,460 |  |  | — |  |  | 9,135 |  |  | — |  | — |  |  | 22,935 |
Substandard | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  | — |  |  | — |
Doubtful | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  | — |  |  | — |
Total single tenant lease financing | 80,516 |  |  | 46,674 |  |  | 220,701 |  |  | 91,652 |  |  | 63,506 |  |  | 446,699 |  |  | — |  | — |  |  | 949,748 |
Year-to-date gross charge-offs | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 195 |  |  | — |  | — |  |  | 195 |
Public finance |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass | 55,306 |  |  | 1,290 |  |  | 7,790 |  |  | 12,050 |  |  | 463 |  |  | 407,008 |  |  | — |  | — |  |  | 483,907 |
Special Mention | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 1,960 |  |  | — |  | — |  |  | 1,960 |
Substandard | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  | — |  |  | — |
Doubtful | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  | — |  |  | — |
Total public finance | 55,306 |  |  | 1,290 |  |  | 7,790 |  |  | 12,050 |  |  | 463 |  |  | 408,968 |  |  | — |  | — |  |  | 485,867 |
Year-to-date gross charge-offs | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  | — |  |  | — |
| December 31, 2024
| Term Loans (amortized cost basis by origination year) |  | Revolving loans amortized cost basis | Revolving loans converted to term |  |
| 2024 |  | 2023 |  | 2022 |  | 2021 |  | 2020 |  | Prior |  |  | Total
Healthcare finance |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass | — |  |  | — |  |  | — |  |  | 8,969 |  |  | 104,427 |  |  | 67,413 |  |  | — |  | — |  |  | 180,809 |
Special Mention | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 618 |  |  | — |  | — |  |  | 618 |
Substandard | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  | — |  |  | — |
Doubtful | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  | — |  |  | — |
Total healthcare finance | — |  |  | — |  |  | — |  |  | 8,969 |  |  | 104,427 |  |  | 68,031 |  |  | — |  | — |  |  | 181,427 |
Year-to-date gross charge-offs | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  | — |  |  | — |
Small business lending |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass | 138,044 |  |  | 94,556 |  |  | 30,486 |  |  | 11,715 |  |  | 9,687 |  |  | 9,896 |  |  | 17,197 |  | — |  |  | 311,581 |
Special Mention | 1,022 |  |  | 4,691 |  |  | 927 |  |  | — |  |  | 354 |  |  | 1,213 |  |  | 697 |  | — |  |  | 8,904 |
Substandard | 2,940 |  |  | 3,909 |  |  | 1,457 |  |  | 258 |  |  | 970 |  |  | 1,001 |  |  | 894 |  | — |  |  | 11,429 |
Doubtful | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  | — |  |  | — |
Total small business lending | 142,006 |  |  | 103,156 |  |  | 32,870 |  |  | 11,973 |  |  | 11,011 |  |  | 12,110 |  |  | 18,788 |  | — |  |  | 331,914 |
Year-to-date gross charge-offs | 1,093 |  |  | 4,600 |  |  | 3,038 |  |  | 567 |  |  | 619 |  |  | 524 |  |  | — |  | — |  |  | 10,441 |
Franchise finance |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass | 67,065 |  |  | 230,425 |  |  | 172,830 |  |  | 42,869 |  |  | — |  |  | — |  |  | — |  | — |  |  | 513,189 |
Special Mention | — |  |  | 1,978 |  |  | 5,084 |  |  | 6,275 |  |  | — |  |  | — |  |  | — |  | — |  |  | 13,337 |
Substandard | — |  |  | 3,543 |  |  | 6,367 |  |  | 473 |  |  | — |  |  | — |  |  | — |  | — |  |  | 10,383 |
Doubtful | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  | — |  |  | — |
Total franchise finance | 67,065 |  |  | 235,946 |  |  | 184,281 |  |  | 49,617 |  |  | — |  |  | — |  |  | — |  | — |  |  | 536,909 |
Year-to-date gross charge-offs | — |  |  | 1,171 |  |  | — |  |  | 295 |  |  | — |  |  | — |  |  | — |  | — |  |  | 1,466 |
Consumer loans |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Residential mortgage |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Performing | 3,577 |  |  | 13,533 |  |  | 183,484 |  |  | 86,213 |  |  | 28,655 |  |  | 55,615 |  |  | — |  | — |  |  | 371,077 |
Nonperforming | — |  |  | — |  |  | 1,671 |  |  | 609 |  |  | 69 |  |  | 1,734 |  |  | — |  | — |  |  | 4,083 |
Total residential mortgage | 3,577 |  |  | 13,533 |  |  | 185,155 |  |  | 86,822 |  |  | 28,724 |  |  | 57,349 |  |  | — |  | — |  |  | 375,160 |
Year-to-date gross charge-offs | — |  |  | — |  |  | 101 |  |  | 58 |  |  | — |  |  | — |  |  | — |  | — |  |  | 159 |
Home equity |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Performing | — |  |  | 992 |  |  | 1,450 |  |  | 356 |  |  | 414 |  |  | 530 |  |  | 13,621 |  | 911 |  |  | 18,274 |
Nonperforming | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  | — |  |  | — |
Total home equity | — |  |  | 992 |  |  | 1,450 |  |  | 356 |  |  | 414 |  |  | 530 |  |  | 13,621 |  | 911 |  |  | 18,274 |
Year-to-date gross charge-offs | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  | — |  |  | — |
Other consumer |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Performing | 101,965 |  |  | 97,832 |  |  | 88,872 |  |  | 33,177 |  |  | 20,918 |  |  | 64,251 |  |  | 870 |  | — |  |  | 407,885 |
Nonperforming | — |  |  | — |  |  | 38 |  |  | 11 |  |  | 1 |  |  | 12 |  |  | — |  | — |  |  | 62 |
Total other consumer | 101,965 |  |  | 97,832 |  |  | 88,910 |  |  | 33,188 |  |  | 20,919 |  |  | 64,263 |  |  | 870 |  | — |  |  | 407,947 |
Year-to-date gross charge-offs | 157 |  |  | 242 |  |  | 300 |  |  | 127 |  |  | 1 |  |  | 182 |  |  | — |  | — |  |  | 1,009 |
Total Loans | $ | 588,038 |  |  | $ | 700,374 |  |  | $ | 973,997 |  |  | $ | 420,019 |  |  | $ | 256,915 |  |  | $ | 1,124,585 |  |  | $ | 79,127 |  | $ | 911 |  |  | $ | 4,143,966 |
Total year-to-date gross charge-offs | $ | 1,250 |  |  | $ | 6,013 |  |  | $ | 3,439 |  |  | $ | 1,047 |  |  | $ | 620 |  |  | $ | 901 |  |  | $ | — |  | $ | — |  |  | $ | 13,270 |
The following tables present the Company’s loan portfolio delinquency analysis, including nonaccrual loans, as of December 31, 2025 and December 31, 2024.
|  | December 31, 2025
|  | 30-59 Days Past Due |  | 60-89 Days Past Due |  | 90 Days or More Past Due |  | Total Past Due |  | Current |  | Total loans
Commercial and industrial |  | $ | 515 |  | $ | 200 |  | $ | — |  | $ | 715 |  | $ | 220,999 |  | $ | 221,714
Owner-occupied commercial real estate |  | — |  | — |  | — |  | — |  | 48,575 |  | 48,575
Investor commercial real estate |  | — |  | — |  | — |  | — |  | 647,394 |  | 647,394
Construction |  | — |  | — |  | — |  | — |  | 372,668 |  | 372,668
Single tenant lease financing |  | — |  | — |  | — |  | — |  | 222,925 |  | 222,925
Public finance |  | — |  | — |  | — |  | — |  | 442,234 |  | 442,234
Healthcare finance |  | — |  | — |  | 1,150 |  | 1,150 |  | 138,319 |  | 139,469
Small business lending |  | 20,325 |  | 4,277 |  | 9,445 |  | 34,047 |  | 395,977 |  | 430,024
Franchise finance |  | 11,641 |  | 1,110 |  | 24,912 |  | 37,663 |  | 379,382 |  | 417,045
Residential mortgage |  | — |  | 3,079 |  | 4,622 |  | 7,701 |  | 335,409 |  | 343,110
Home equity |  | — |  | — |  | — |  | — |  | 14,725 |  | 14,725
Other consumer |  | 243 |  | 102 |  | 141 |  | 486 |  | 424,972 |  | 425,458
Total |  | $ | 32,724 |  | $ | 8,768 |  | $ | 40,270 |  | $ | 81,762 |  | $ | 3,643,579 |  | $ | 3,725,341
|  | December 31, 2024
|  | 30-59 Days Past Due |  | 60-89 Days Past Due |  | 90 Days or More Past Due |  | Total Past Due |  | Current |  | Total loans
Commercial and industrial |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 120,175 |  |  | $ | 120,175 |
Owner-occupied commercial real estate |  | — |  |  | — |  |  | — |  |  | — |  |  | 53,591 |  |  | 53,591 |
Investor commercial real estate |  | — |  |  | — |  |  | — |  |  | — |  |  | 269,431 |  |  | 269,431 |
Construction |  | — |  |  | — |  |  | — |  |  | — |  |  | 413,523 |  |  | 413,523 |
Single tenant lease financing |  | — |  |  | — |  |  | — |  |  | — |  |  | 949,748 |  |  | 949,748 |
Public finance |  | — |  |  | — |  |  | — |  |  | — |  |  | 485,867 |  |  | 485,867 |
Healthcare finance |  | — |  |  | — |  |  | — |  |  | — |  |  | 181,427 |  |  | 181,427 |
Small business lending |  | 11,817 |  |  | 1,310 |  |  | 5,587 |  |  | 18,714 |  |  | 313,200 |  |  | 331,914 |
Franchise finance |  | 9,431 |  |  | 3,279 |  |  | 9,849 |  |  | 22,559 |  |  | 514,350 |  |  | 536,909 |
Residential mortgage |  | 648 |  |  | 1,711 |  |  | 3,815 |  |  | 6,174 |  |  | 368,986 |  |  | 375,160 |
Home equity |  | — |  |  | — |  |  | — |  |  | — |  |  | 18,274 |  |  | 18,274 |
Other consumer |  | 194 |  |  | 196 |  |  | 27 |  |  | 417 |  |  | 407,530 |  |  | 407,947 |
Total |  | $ | 22,090 |  |  | $ | 6,496 |  |  | $ | 19,278 |  |  | $ | 47,864 |  |  | $ | 4,096,102 |  |  | $ | 4,143,966 |
Loans are reclassified to non-accruing status when, in management’s judgment, the collateral value and financial condition of the borrower do not justify accruing interest. At the time the accrual is discontinued, all unpaid accrued interest is reversed against earnings. Interest income accrued in prior years, if any, is charged to the ACL. Payments subsequently received on nonaccrual loans are applied to principal. A loan is returned to accrual status when principal and interest are no longer past due and collectability is probable, typically after a minimum of nine consecutive months of performance. The following table summarizes the Company’s nonaccrual loans and loans past due 90 days or more and still accruing by loan class for the periods indicated:
|  | December 31, 2025 |  | December 31, 2024
|  | Total Nonaccrual Loans |  | Nonaccrual Loans with no Allowance for Credit Losses |  | Total Loans 90 Days or More Past Due and Accruing |  | Total Nonaccrual Loans |  | Nonaccrual Loans with no Allowance for Credit Losses |  | Total Loans 90 Days or More Past Due and Accruing
Commercial and industrial |  | $ | 240 |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |
Single tenant lease financing |  | 1,665 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Healthcare finance |  | 2,596 |  |  | 2,596 |  |  | — |  |  | — |  |  | — |  |  | — |
Small business lending |  | 19,781 |  |  | 18,928 |  |  | — |  |  | 11,429 |  |  | 4,778 |  |  | 1,320 |
Franchise finance |  | 26,978 |  |  | 4,463 |  |  | 1,144 |  |  | 10,382 |  |  | — |  |  | — |
Residential mortgage |  | 4,893 |  |  | 4,893 |  |  | 1,007 |  |  | 4,083 |  |  | 4,083 |  |  | 1,142 |
Other consumer |  | 234 |  |  | 234 |  |  | — |  |  | 61 |  |  | 61 |  |  | 4 |
Total loans |  | $ | 56,387 |  |  | $ | 31,114 |  |  | $ | 2,151 |  |  | $ | 25,955 |  |  | $ | 8,922 |  |  | $ | 2,466 |
1 Balances include $13.6 million and $4.9 million that are guaranteed by the U.S. government as of December 31, 2025 and December 31, 2024, respectively. There was $2.4 million and $0.7 million in interest income recognized on nonaccrual loans for the twelve months ended December 31, 2025 and December 31, 2024, respectively. Determining fair value for collateral dependent loans requires obtaining a current independent appraisal of the collateral and applying a discount factor, which includes selling costs if applicable, to the value. The fair value of real estate is generally based on appraisals by qualified licensed appraisers. The appraisers typically determine the value of the real estate by utilizing an income or market valuation approach. If an appraisal is not available, the fair value may be determined by using a cash flow analysis. Fair value on other collateral such as business assets is typically ascertained by assessing, either singularly or some combination of, asset appraisals, accounts receivable aging reports, inventory listings and/or customer financial statements. Both appraised values and values based on borrower’s financial information are discounted as considered appropriate based on age and quality of the information and current market conditions. The following tables present the amortized cost basis of collateral dependent loans, which are individually evaluated to determine expected credit losses as of December 31, 2025 and December 31, 2024.
|  | December 31, 2025
|  | Commercial Real Estate |  | Residential Real Estate |  | Other (Includes Equipment, Machinery and Other Assets) |  | Total |  | Allowance on Collateral Dependent Loans
Owner-occupied commercial real estate |  | $ | 1,654 |  |  | $ | — |  |  | $ | — |  |  | $ | 1,654 |  |  | $ | — |
Small business lending 1 |  | 6,732 |  |  | — |  |  | 7,681 |  |  | 14,413 |  |  | 411 |
Residential mortgage |  | — |  |  | 4,893 |  |  | — |  |  | 4,893 |  |  | — |
Other consumer loans |  | — |  |  | — |  |  | 234 |  |  | 234 |  |  | — |
Total loans |  | $ | 8,386 |  |  | $ | 4,893 |  |  | $ | 7,915 |  |  | $ | 21,194 |  |  | $ | 411 |
1 Balance includes $8.5 million of loans guaranteed by the U.S. government.
|  | December 31, 2024 |  |  |  |
|  | Commercial Real Estate |  | Residential Real Estate |  | Other (Includes Equipment, Machinery and Other Assets) |  | Total |  | Allowance on Collateral Dependent Loans |  |  |  |
Owner-occupied commercial real estate |  | $ | 1,654 |  |  | $ | — |  |  | $ | — |  |  | $ | 1,654 |  |  | $ | — |  |  |  |  |
Small business lending 1 |  | 723 |  |  | — |  |  | 8,571 |  |  | 9,294 |  |  | 4,167 |  |  |  |  |
Franchise finance |  | — |  |  | — |  |  | 3,468 |  |  | 3,468 |  |  | 679 |  |  |  |  |
Residential mortgage |  | — |  |  | 4,083 |  |  | — |  |  | 4,083 |  |  | — |  |  |  |  |
Other consumer loans |  | — |  |  | — |  |  | 22 |  |  | 22 |  |  | — |  |  |  |  |
Total loans |  | $ | 2,377 |  |  | $ | 4,083 |  |  | $ | 12,061 |  |  | $ | 18,521 |  |  | $ | 4,846 |  |  |  |  |
1 Balance includes $3.5 million of loans guaranteed by the U.S. government. Loan Modifications to Borrowers Experiencing Financial Difficulty The Company may agree to modify the contractual terms of a loan to a borrower experiencing financial difficulty as a part of ongoing loss mitigation strategies. These modifications may include interest rate reductions, principal or interest forgiveness, other-than-insignificant payment delays, term extensions and other actions intended to minimize loss and to avoid foreclosure or repossession of collateral. The Company had twelve loan modifications made to borrowers experiencing financial difficulty during the twelve months ended December 31, 2025. The Company had five loan modifications made to borrowers experiencing financial difficulty during the twelve months ended December 31, 2024. The following tables present loans that were both experiencing financial difficulty and modified during the twelve months ended December 31, 2025 and December 31, 2024.
|  | Twelve Months Ended December 31, 2025
|  | Other-Than-Insignificant Payment Delay |  |  |  | Total Modification by Loan Class |  | % of Class of Loans
Commercial and industrial |  | $ | 350 |  |  |  |  | $ | 350 |  |  | 0.2 | %
Single tenant lease financing |  | 4,672 |  |  |  |  | 4,672 |  |  | 2.1 | %
Healthcare finance |  | 2,726 |  |  |  |  | 2,726 |  |  | 2.0 | %
Small business lending |  | 3,022 |  |  |  |  | 3,022 |  |  | 0.7 | %
Franchise finance |  | 510 |  |  |  |  | 510 |  |  | 0.1 | %
Total loans |  | $ | 11,280 |  |  |  |  | $ | 11,280 |  |  |
|  | Twelve Months Ended December 31, 2024
|  | Other-Than-Insignificant Payment Delay |  |  |  | Total Modification by Loan Class |  | % of Class of Loans
Investor commercial real estate |  | $ | 3,731 |  |  |  |  | $ | 3,731 |  |  | 1.4 | %
Franchise finance |  | 5,566 |  |  |  |  | 5,566 |  |  | 1.0 | %
Total loans |  | $ | 9,297 |  |  |  |  | $ | 9,297 |  |  |
The Company closely monitors the performance of loans that are modified to borrowers experiencing financial difficulty to understand the effectiveness of its modification efforts. The following tables present the performance of such loans that have been modified in the last twelve months as of December 31, 2025 and December 31, 2024.
|  | Twelve Months Ended December 31, 2025
|  | Current |  |  |  | 30 - 89 Days Past Due |  | 90+ Days Past Due
Commercial and industrial |  | $ | 350 |  |  |  |  | $ | — |  |  | $ | — |
Single tenant lease financing |  | 4,672 |  |  |  |  | — |  |  | — |
Healthcare finance |  | 1,280 |  |  |  |  | 1,446 |  |  | — |
Small business lending |  | 3,022 |  |  |  |  | — |  |  | — |
Franchise finance |  | 510 |  |  |  |  | — |  |  | — |
Total loans |  | $ | 9,834 |  |  |  |  | $ | 1,446 |  |  | $ | — |
|  | Twelve Months Ended December 31, 2024
|  | Current |  |  |  | 30 - 89 Days Past Due |  | 90+ Days Past Due
Investor commercial real estate |  | $ | 3,731 |  |  |  |  | $ | — |  |  | $ | — |
Franchise finance |  | 5,566 |  |  |  |  | — |  |  | — |
Total loans |  | $ | 9,297 |  |  |  |  | $ | — |  |  | $ | — |
Other Real Estate Owned The Company had $2.6 million in other real estate owned (“OREO”) as of December 31, 2025, which consisted of three small business lending properties. The Company had $0.3 million in other real estate owned (“OREO”) as of December 31, 2024, which consisted of one residential mortgage property. There were eight loans totaling $2.5 million and nine loans totaling $2.1 million, in the process of foreclosure at December 31, 2025 and December 31, 2024, respectively.

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