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Note 5 - Allowance for Loan Losses, Nonperforming Assets and Impaired Loans | 12 Months Ended
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Dec. 31, 2021
Notes to Financial Statements |
Allowance for Credit Losses [Text Block] | Note 5: Allowance for Loan Losses, Nonperforming Assets and Impaired Loans The allowance for loan losses methodology incorporates individual evaluation of impaired loans and collective evaluation of groups of non-impaired loans. The Company performs ongoing analysis of the loan portfolio to determine credit quality on an individual loan basis and to identify impaired loans. Please refer to Note 1: Summary of Significant Accounting Policies for additional information on evaluation of impaired loans and associated specific reserves, and policies regarding nonaccruals, past due status and charge-offs. Portfolio Segments and Classes The Company evaluated characteristics in the loan portfolio and determined major segments and smaller classes within each segment. These characteristics include collateral type and intended use, repayment sources, and (if applicable) the borrower’s business model. The methodology for calculating reserves for collectively evaluated loans is applied at the class level. The Company’s segments and classes within each segment are presented below:
| Real Estate Construction Construction, residential Construction, other Consumer Real Estate Equity lines Residential closed-end first liens Residential closed-end junior liens Investor-owned residential real estate Commercial Real Estate Multifamily real estate Commercial real estate, owner-occupied Commercial real estate, other | Commercial Non-Real Estate Commercial and Industrial Public Sector and IDA State and political subdivisions Consumer Non-Real Estate Credit cards Automobile Other consumer loans
Collectively-evaluated loans within each class are further stratified by risk rating: pass-rated loans, loans rated special mention, and loans rated classified. Credit risk for collectively-evaluated loans is estimated at the class level, by risk rating, by applying historical net charge-off rates and percentages for qualitative factors that influence credit risk. Please refer to Note 1: Summary of Significant Accounting Policies for a discussion of risk factors pertinent to each class, information on evaluation of impaired loans and associated specific reserves, and policies regarding nonaccruals, past due status and charge-offs. A detailed analysis showing the allowance roll-forward by portfolio segment follows:
|  | Activity in the Allowance for Loan Losses by Segment for the year ended December 31, 2021 |
|  | Real Estate Construction |  |  | Consumer Real Estate |  |  | Commercial Real Estate |  |  | Commercial Non-Real Estate |  |  | Public Sector and IDA |  |  | Consumer Non-Real Estate |  |  | Unallocated |  |  | Total |
Balance, December 31, 2020 |  | $ | 503 |  |  | $ | 2,165 |  |  | $ | 3,853 |  |  | $ | 670 |  |  | $ | 339 |  |  | $ | 555 |  |  | $ | 396 |  |  | $ | 8,481 |
Charge-offs |  |  | - |  |  |  | (13 | ) |  |  | - |  |  |  | (526 | ) |  |  | - |  |  |  | (216 | ) |  |  | - |  |  |  | (755 | )
Recoveries |  |  | - |  |  |  | 20 |  |  |  | 159 |  |  |  | 33 |  |  |  | - |  |  |  | 134 |  |  |  | - |  |  |  | 346 |
Provision for (recovery of) loan losses |  |  | (81 | ) |  |  | (242 | ) |  |  | (891 | ) |  |  | 922 |  |  |  | (42 | ) |  |  | (29 | ) |  |  | (35 | ) |  |  | (398 | )
Balance, December 31, 2021 |  | $ | 422 |  |  | $ | 1,930 |  |  | $ | 3,121 |  |  | $ | 1,099 |  |  | $ | 297 |  |  | $ | 444 |  |  | $ | 361 |  |  | $ | 7,674 |
|  | Activity in the Allowance for Loan Losses by Segment for the year ended December 31, 2020 |
|  | Real Estate Construction |  |  | Consumer Real Estate |  |  | Commercial Real Estate |  |  | Commercial Non-Real Estate |  |  | Public Sector and IDA |  |  | Consumer Non-Real Estate |  |  | Unallocated |  |  | Total |
Balance, December 31, 2019 |  | $ | 400 |  |  | $ | 1,895 |  |  | $ | 2,559 |  |  | $ | 555 |  |  | $ | 478 |  |  | $ | 650 |  |  | $ | 326 |  |  | $ | 6,863 |
Charge-offs |  |  | - |  |  |  | (85 | ) |  |  | (15 | ) |  |  | (372 | ) |  |  | - |  |  |  | (248 | ) |  |  | - |  |  |  | (720 | )
Recoveries |  |  | - |  |  |  | 18 |  |  |  | 145 |  |  |  | 9 |  |  |  | - |  |  |  | 175 |  |  |  | - |  |  |  | 347 |
Provision for (recovery of) loan losses |  |  | 103 |  |  |  | 337 |  |  |  | 1,164 |  |  |  | 478 |  |  |  | (139 | ) |  |  | (22 | ) |  |  | 70 |  |  |  | 1,991 |
Balance, December 31, 2020 |  | $ | 503 |  |  | $ | 2,165 |  |  | $ | 3,853 |  |  | $ | 670 |  |  | $ | 339 |  |  | $ | 555 |  |  | $ | 396 |  |  | $ | 8,481 |
A detailed analysis showing the allowance and loan portfolio by segment and evaluation method follows:
|  | Allowance for Loan Losses by Segment and Evaluation Method as of |
|  | December 31, 2021 |
|  | Real Estate Construction |  |  | Consumer Real Estate |  |  | Commercial Real Estate |  |  | Commercial Non-Real Estate |  |  | Public Sector and IDA |  |  | Consumer Non-Real Estate |  |  | Unallocated |  |  | Total |
Individually evaluated for impairment |  | $ | - |  |  | $ | - |  |  | $ | - |  |  | $ | - |  |  | $ | - |  |  | $ | - |  |  | $ | - |  |  | $ | - |
Collectively evaluated loans |  |  | 422 |  |  |  | 1,930 |  |  |  | 3,121 |  |  |  | 1,099 |  |  |  | 297 |  |  |  | 444 |  |  |  | 361 |  |  |  | 7,674 |
Total |  | $ | 422 |  |  | $ | 1,930 |  |  | $ | 3,121 |  |  | $ | 1,099 |  |  | $ | 297 |  |  | $ | 444 |  |  | $ | 361 |  |  | $ | 7,674 |
|  | Loans by Segment and Evaluation Method as of |
|  | December 31, 2021 |
|  | Real Estate Construction |  |  | Consumer Real Estate |  |  | Commercial Real Estate |  |  | Commercial Non-Real Estate |  |  | Public Sector and IDA |  |  | Consumer Non-Real Estate |  |  | Unallocated |  |  | Total |
Individually evaluated for impairment |  | $ | - |  |  | $ | 191 |  |  | $ | 5,386 |  |  | $ | 301 |  |  | $ | - |  |  | $ | - |  |  | $ | - |  |  | $ | 5,878 |
Collectively evaluated loans |  |  | 48,841 |  |  |  | 208,786 |  |  |  | 400,336 |  |  |  | 59,963 |  |  |  | 47,899 |  |  |  | 32,026 |  |  |  | - |  |  |  | 797,851 |
Total |  | $ | 48,841 |  |  | $ | 208,977 |  |  | $ | 405,722 |  |  | $ | 60,264 |  |  | $ | 47,899 |  |  | $ | 32,026 |  |  | $ | - |  |  | $ | 803,729 |
|  | Allowance for Loan Losses by Segment and Evaluation Method as of |
|  | December 31, 2020 |
|  | Real Estate Construction |  |  | Consumer Real Estate |  |  | Commercial Real Estate |  |  | Commercial Non-Real Estate |  |  | Public Sector and IDA |  |  | Consumer Non-Real Estate |  |  | Unallocated |  |  | Total |
Individually evaluated for impairment |  | $ | - |  |  | $ | 2 |  |  | $ | - |  |  | $ | 73 |  |  | $ | - |  |  | $ | - |  |  | $ | - |  |  | $ | 75 |
Collectively evaluated loans |  |  | 503 |  |  |  | 2,163 |  |  |  | 3,853 |  |  |  | 597 |  |  |  | 339 |  |  |  | 555 |  |  |  | 396 |  |  |  | 8,406 |
Total |  | $ | 503 |  |  | $ | 2,165 |  |  | $ | 3,853 |  |  | $ | 670 |  |  | $ | 339 |  |  | $ | 555 |  |  | $ | 396 |  |  | $ | 8,481 |
|  | Loans by Segment and Evaluation Method as of |
|  | December 31, 2020 |
|  | Real Estate Construction |  |  | Consumer Real Estate |  |  | Commercial Real Estate |  |  | Commercial Non-Real Estate |  |  | Public Sector and IDA |  |  | Consumer Non-Real Estate |  |  | Unallocated |  |  | Total |
Individually evaluated for impairment |  | $ | - |  |  | $ | 194 |  |  | $ | 3,856 |  |  | $ | 851 |  |  | $ | - |  |  | $ | 2 |  |  | $ | - |  |  | $ | 4,903 |
Collectively evaluated loans |  |  | 42,266 |  |  |  | 181,588 |  |  |  | 389,259 |  |  |  | 77,920 |  |  |  | 40,983 |  |  |  | 33,108 |  |  |  | - |  |  |  | 765,124 |
Total |  | $ | 42,266 |  |  | $ | 181,782 |  |  | $ | 393,115 |  |  | $ | 78,771 |  |  | $ | 40,983 |  |  | $ | 33,110 |  |  | $ | - |  |  | $ | 770,027 |
A summary of ratios for the allowance for loan losses follows:
|  | December 31, |
|  | 2021 |  |  | 2020 |
Ratio of allowance for loan losses to the end of period loans, net of unearned income and deferred fees and costs |  |  | 0.96 | % |  |  | 1.10 | %
Ratio of net charge-offs to average loans, net of unearned income and deferred fees and costs |  |  | 0.05 | % |  |  | 0.05 | %
A summary of nonperforming assets, as of the dates indicated, follows:
|  | December 31, |
|  | 2021 |  |  | 2020 |
Nonperforming assets: |  |  |  |  |  |  |  |
Nonaccrual loans |  | $ | - |  |  | $ | 846 |
TDR loans in nonaccrual |  |  | 2,873 |  |  |  | 2,839 |
Total nonperforming loans |  |  | 2,873 |  |  |  | 3,685 |
Other real estate owned, net |  |  | 957 |  |  |  | 1,553 |
Total nonperforming assets |  | $ | 3,830 |  |  | $ | 5,238 |
Ratio of nonperforming assets to loans, net of unearned income and deferred fees and costs, plus other real estate owned |  |  | 0.48 | % |  |  | 0.68 | %
Ratio of allowance for loan losses to nonperforming loans(1) |  |  | 267.11 | % |  |  | 230.15 | %
| (1) | The Company defines nonperforming loans as total nonaccrual and TDR loans that are nonaccrual. Loans 90 days past due and still accruing and accruing TDR loans are excluded.
As of December 31, 2021, OREO is comprised of construction properties. There is no residential real estate in OREO. As of December 31, 2021, $62 in loans secured by residential real estate are in process of foreclosure. A summary of loans past due 90 days or more and impaired loans, as of the dates indicated, follows:
|  | December 31, |
|  | 2021 |  |  | 2020 |
Loans past due 90 days or more and still accruing |  | $ | 90 |  |  | $ | 17 |
Ratio of loans past due 90 days or more and still accruing to loans, net of unearned income and deferred fees and costs |  |  | 0.01 | % |  |  | 0.00 | %
Accruing TDR loans |  | $ | 3,005 |  |  | $ | 1,410 |
Impaired loans: |  |  |  |  |  |  |  |
Impaired loans with no valuation allowance |  | $ | 5,878 |  |  | $ | 3,858 |
Impaired loans with a valuation allowance |  |  | - |  |  |  | 1,045 |
Total impaired loans |  | $ | 5,878 |  |  | $ | 4,903 |
Valuation allowance |  | $ | - |  |  | $ | (75 | )
Impaired loans, net of allowance |  | $ | 5,878 |  |  | $ | 4,828 |
Average recorded investment in impaired loans(1) |  | $ | 5,901 |  |  | $ | 5,093 |
Income recognized on impaired loans, after designation as impaired |  | $ | 137 |  |  | $ | 54 |
Amount of income recognized on a cash basis |  | $ | - |  |  | $ | - |
| (1) | Recorded investment is net of charge-offs and interest paid while a loan is in nonaccrual status.
No interest income was recognized on nonaccrual loans for the years ended December 31, 2021 or 2020. Nonaccrual loans that meet the Company’s balance thresholds are designated as impaired. A detailed analysis of investment in impaired loans, associated reserves and interest income recognized, by loan class follows:
|  | Impaired Loans as of December 31, 2021 |
|  | Principal Balance |  |  | (A) Total Recorded Investment(1) |  |  | Recorded Investment(1) in (A) for Which There is No Related Allowance |  |  | Recorded Investment(1) in (A) for Which There is a Related Allowance |  |  | Related Allowance |
Consumer Real Estate(2) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Investor-owned residential real estate |  | $ | 191 |  |  | $ | 191 |  |  | $ | 191 |  |  | $ | - |  |  | $ | - |
Commercial Real Estate(2) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial real estate, owner occupied |  |  | 3,256 |  |  |  | 2,665 |  |  |  | 2,665 |  |  |  | - |  |  |  | - |
Commercial real estate, other |  |  | 2,721 |  |  |  | 2,721 |  |  |  | 2,721 |  |  |  | - |  |  |  | - |
Commercial Non-Real Estate(2) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial and Industrial |  |  | 310 |  |  |  | 301 |  |  |  | 301 |  |  |  | - |  |  |  | - |
Total |  | $ | 6,478 |  |  | $ | 5,878 |  |  | $ | 5,878 |  |  | $ | - |  |  | $ | - |
|  | Impaired Loans as of December 31, 2020 |
|  | Principal Balance |  |  | (A) Total Recorded Investment(1) |  |  | Recorded Investment(1) in (A) for Which There is No Related Allowance |  |  | Recorded Investment(1) in (A) for Which There is a Related Allowance |  |  | Related Allowance |
Consumer Real Estate(2) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Investor-owned residential real estate |  | $ | 194 |  |  | $ | 194 |  |  | $ | - |  |  | $ | 194 |  |  | $ | 2 |
Commercial Real Estate(2) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial real estate, owner occupied |  |  | 3,752 |  |  |  | 3,202 |  |  |  | 3,202 |  |  |  | - |  |  |  | - |
Commercial real estate, other |  |  | 654 |  |  |  | 654 |  |  |  | 654 |  |  |  | - |  |  |  | - |
Commercial Non-Real Estate(2) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial and Industrial |  |  | 851 |  |  |  | 851 |  |  |  | - |  |  |  | 851 |  |  |  | 73 |
Consumer Non-Real Estate(2) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Automobile |  |  | 2 |  |  |  | 2 |  |  |  | 2 |  |  |  | - |  |  |  | - |
Total |  | $ | 5,453 |  |  | $ | 4,903 |  |  | $ | 3,858 |  |  | $ | 1,045 |  |  | $ | 75 |
| (1) | Recorded investment is net of charge-offs and interest paid while a loan is in nonaccrual status.
| (2) | Only classes with impaired loans are shown.
Information on the average investment and interest income of impaired loans is presented in the tables below:
Impaired Loans |  | For the Year Ended December 31, 2021 |
|  | Average Recorded Investment(1) |  |  | Interest Income Recognized |
Consumer Real Estate(2) |  |  |  |  |  |  |  |
Investor-owned residential real estate |  | $ | 192 |  |  | $ | 13 |
Commercial Real Estate(2) |  |  |  |  |  |  |  |
Commercial real estate, owner occupied |  |  | 2,668 |  |  |  | 9 |
Commercial real estate, other |  |  | 2,723 |  |  |  | 100 |
Commercial Non-Real Estate(2) |  |  |  |  |  |  |  |
Commercial and Industrial |  |  | 317 |  |  |  | 15 |
Consumer Non-Real Estate(2) |  |  |  |  |  |  |  |
Automobile |  |  | 1 |  |  |  | - |
Total |  | $ | 5,901 |  |  | $ | 137 |
Impaired Loans |  | For the Year Ended December 31, 2020 |
|  | Average Recorded Investment(1) |  |  | Interest Income Recognized |
Consumer Real Estate(2) |  |  |  |  |  |  |  |
Investor-owned residential real estate |  | $ | 196 |  |  | $ | 13 |
Commercial Real Estate(2) |  |  |  |  |  |  |  |
Commercial real estate, owner occupied |  |  | 3,217 |  |  |  | 19 |
Commercial real estate, other |  |  | 790 |  |  |  | - |
Commercial Non-Real Estate(2) |  |  |  |  |  |  |  |
Commercial and Industrial |  |  | 887 |  |  |  | 22 |
Consumer Non-Real Estate(2) |  |  |  |  |  |  |  |
Automobile |  |  | 3 |  |  |  | - |
Total |  | $ | 5,093 |  |  | $ | 54 |
(1) | Recorded investment is net of charge-offs and interest paid while a loan is in nonaccrual status.
(2) | Only classes with impaired loans are shown.
An analysis of past due and nonaccrual loans, as of the dates indicated, follows:
December 31, 2021 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | 30 – 89 Days Past Due |  |  | 90 or More Days Past Due |  |  | 90 or More Days Past Due and Still Accruing |  |  | Nonaccruals (Including Impaired Nonaccruals) |
Real Estate Construction(1) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Construction, other |  | $ | 14 |  |  | $ | - |  |  | $ | - |  |  | $ | - |
Consumer Real Estate(1) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Equity lines |  |  | 50 |  |  |  | 29 |  |  |  | 29 |  |  |  |  |
Residential closed-end first liens |  |  | 715 |  |  |  | 58 |  |  |  | 58 |  |  |  | - |
Commercial Real Estate(1) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial real estate, owner occupied |  |  | 12 |  |  |  | 266 |  |  |  | - |  |  |  | 2,572 |
Commercial Non-Real Estate(1) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial and Industrial |  |  | 13 |  |  |  | - |  |  |  | - |  |  |  | 301 |
Consumer Non-Real Estate (1) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Credit cards |  |  | 2 |  |  |  | 2 |  |  |  | 2 |  |  |  | - |
Automobile |  |  | 93 |  |  |  | - |  |  |  | - |  |  |  | - |
Other consumer loans |  |  | 88 |  |  |  | 1 |  |  |  | 1 |  |  |  | - |
Total |  | $ | 987 |  |  | $ | 356 |  |  | $ | 90 |  |  | $ | 2,873 |
| (1) | Only classes with past due or nonaccrual loans are presented.
December 31, 2020 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | 30 – 89 Days Past Due |  |  | 90 or More Days Past Due |  |  | 90 or More Days Past Due and Still Accruing |  |  | Nonaccruals (Including Impaired Nonaccruals) |
Consumer Real Estate(1) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Residential closed-end first liens |  | $ | 365 |  |  | $ | 62 |  |  | $ | - |  |  | $ | 62 |
Investor-owned residential real estate |  |  | 106 |  |  |  | - |  |  |  | - |  |  |  | - |
Commercial Real Estate(1) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial real estate, owner occupied |  |  | 15 |  |  |  | 571 |  |  |  | - |  |  |  | 2,941 |
Commercial real estate, other |  |  | - |  |  |  | 654 |  |  |  | - |  |  |  | 654 |
Commercial Non-Real Estate(1) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial and Industrial |  |  | 730 |  |  |  | 27 |  |  |  | - |  |  |  | 28 |
Consumer Non-Real Estate (1) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Credit cards |  |  | 7 |  |  |  | 3 |  |  |  | 3 |  |  |  | - |
Automobile |  |  | 144 |  |  |  | 1 |  |  |  | 1 |  |  |  | - |
Other consumer loans |  |  | 130 |  |  |  | 13 |  |  |  | 13 |  |  |  | - |
Total |  | $ | 1,497 |  |  | $ | 1,331 |  |  | $ | 17 |  |  | $ | 3,685 |
| (1) | Only classes with past due or nonaccrual loans are presented.
Determination of risk grades was completed for the portfolio as of December 31, 2021 and 2020. The following displays non-impaired gross loans by credit quality indicator as of the dates indicated: December 31, 2021
Collectively-Evaluated Loans |  | Pass |  |  | Special Mention |  |  | Classified |
Real Estate Construction |  |  |  |  |  |  |  |  |  |  |  |
Construction, 1-4 family residential |  | $ | 10,008 |  |  | $ | - |  |  | $ | - |
Construction, other |  |  | 38,833 |  |  |  | - |  |  |  | - |
Consumer Real Estate |  |  |  |  |  |  |  |  |  |  |  |
Equity lines |  |  | 13,588 |  |  |  | - |  |  |  | 29 |
Closed-end first liens |  |  | 106,107 |  |  |  | - |  |  |  | 275 |
Closed-end junior liens |  |  | 2,715 |  |  |  | - |  |  |  | - |
Investor-owned residential real estate |  |  | 85,460 |  |  |  | - |  |  |  | 612 |
Commercial Real Estate |  |  |  |  |  |  |  |  |  |  |  |
Multifamily residential real estate |  |  | 106,644 |  |  |  | - |  |  |  | - |
Commercial real estate owner-occupied |  |  | 125,605 |  |  |  | - |  |  |  | 35 |
Commercial real estate, other |  |  | 164,324 |  |  |  | 3,728 |  |  |  | - |
Commercial Non-Real Estate |  |  |  |  |  |  |  |  |  |  |  |
Commercial and Industrial |  |  | 59,953 |  |  |  | - |  |  |  | 10 |
Public Sector and IDA |  |  |  |  |  |  |  |  |  |  |  |
States and political subdivisions |  |  | 47,899 |  |  |  | - |  |  |  | - |
Consumer Non-Real Estate |  |  |  |  |  |  |  |  |  |  |  |
Credit cards |  |  | 4,531 |  |  |  | - |  |  |  | - |
Automobile |  |  | 10,990 |  |  |  | - |  |  |  | 3 |
Other consumer |  |  | 16,402 |  |  |  | - |  |  |  | 100 |
Total |  | $ | 793,059 |  |  | $ | 3,728 |  |  | $ | 1,064 |
December 31, 2020
Collectively-Evaluated Loans |  | Pass |  |  | Special Mention |  |  | Classified |
Real Estate Construction |  |  |  |  |  |  |  |  |  |  |  |
Construction, 1-4 family residential |  | $ | 8,195 |  |  | $ | - |  |  | $ | - |
Construction, other |  |  | 34,071 |  |  |  | - |  |  |  | - |
Consumer Real Estate |  |  |  |  |  |  |  |  |  |  |  |
Equity lines |  |  | 13,903 |  |  |  | - |  |  |  | - |
Closed-end first liens |  |  | 92,241 |  |  |  | 66 |  |  |  | 284 |
Closed-end junior liens |  |  | 3,003 |  |  |  | - |  |  |  | - |
Investor-owned residential real estate |  |  | 71,450 |  |  |  | 641 |  |  |  | - |
Commercial Real Estate |  |  |  |  |  |  |  |  |  |  |  |
Multifamily residential real estate |  |  | 87,455 |  |  |  | 265 |  |  |  | - |
Commercial real estate owner-occupied |  |  | 146,900 |  |  |  | 543 |  |  |  | 140 |
Commercial real estate, other |  |  | 147,436 |  |  |  | 6,520 |  |  |  | - |
Commercial Non-Real Estate |  |  |  |  |  |  |  |  |  |  |  |
Commercial and Industrial |  |  | 77,892 |  |  |  | - |  |  |  | 28 |
Public Sector and IDA |  |  |  |  |  |  |  |  |  |  |  |
States and political subdivisions |  |  | 40,983 |  |  |  | - |  |  |  | - |
Consumer Non-Real Estate |  |  |  |  |  |  |  |  |  |  |  |
Credit cards |  |  | 4,665 |  |  |  | - |  |  |  | - |
Automobile |  |  | 12,024 |  |  |  | - |  |  |  | 6 |
Other consumer |  |  | 16,398 |  |  |  | - |  |  |  | 15 |
Total |  | $ | 756,616 |  |  | $ | 8,035 |  |  | $ | 473 |
Sales, Purchases and Reclassification of Loans The Company finances mortgages under “best efforts” contracts with mortgage purchasers. The mortgages are designated as held for sale upon initiation. There have been no major reclassifications from portfolio loans to held for sale. Occasionally, the Company purchases or sells participations in loans. All participation loans purchased met the Company’s normal underwriting standards at the time the participation was entered. Participation loans are included in the appropriate portfolio balances to which the allowance methodology is applied. Troubled Debt Restructurings Total TDRs amounted to $5,878 at December 31, 2021 and $4,249 at December 31, 2020. All of the Company’s TDR loans are fully funded and no further increase in credit is available. TDRs Designated During the Reporting Period The Company recognized three new TDRs during 2021. The restructuring of one commercial real estate owner-occupied loan provided cash flow relief to the borrower by shifting the payment structure from interest-only to amortizing and reducing the interest rate. The restructurings of the two other commercial real estate loans provided cash flow relief by re-amortizing the loans over a longer period and reducing the interest rate. No principal or interest was forgiven. The impairment measurement for all three loans at December 31, 2021 was based upon the collateral method and did not result in a specific allocation. There were no new TDRs designated in 2020. The following table presents TDRs by class that occurred during the year ended December 31, 2021.
|  | TDRs that occurred during the year ended December 31, 2021 |
|  | Number of Contracts |  |  | Pre- Modification Outstanding Recorded Investment |  |  | Post- Modification Outstanding Recorded Investment(1) |
Commercial Real Estate |  |  |  |  |  |  |  |  |  |  |  |
Commercial real estate owner-occupied |  |  | 1 |  |  | $ | 102 |  |  | $ | 102 |
Commercial real estate, other |  |  | 2 |  |  |  | 2,724 |  |  |  | 2,724 |
Total |  |  | 3 |  |  | $ | 2,826 |  |  | $ | 2,826 |
| (1) | Post-modification outstanding recorded investment considers amounts immediately following the modification. Amounts do not reflect balances at the end of the period.
Defaulted TDRs The Company analyzed its TDR portfolio for loans that defaulted during 2021 and 2020, and that were modified within 12 months prior to default. The Company designates three circumstances that indicate default: one or more payments that occur more than 90 days past the due date, charge-off, or foreclosure after the date of restructuring. Of the Company’s TDRs at December 31, 2021 and December 31, 2020, none of the defaulted TDRs were modified within 12 months prior to default.

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