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Note 3 - Loans and Allowance for Credit Losses | 9 Months Ended
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Sep. 30, 2024
Notes to Financial Statements |
Financing Receivables [Text Block] | Note 3: Loans and Allowance for Credit Losses Loans Loans as of September 30, 2024 include acquired loans at their outstanding principal balance, net of the remaining purchase discount of $7,886. Originated loans as of September 30, 2024 and December 31, 2023 are presented at amortized cost, net of unearned income and deferred fees and costs. The following table presents the composition of the loan portfolio, excluding mortgage loans held for sale, as of the dates indicated.
|  | September 30, 2024 |  |  | December 31, 2023 |
Real estate construction |  | $ | 71,920 |  |  | $ | 55,379 |
Consumer real estate |  |  | 306,012 |  |  |  | 241,564 |
Commercial real estate |  |  | 473,018 |  |  |  | 419,130 |
Commercial non real estate |  |  | 52,699 |  |  |  | 41,555 |
Public sector and IDA |  |  | 58,109 |  |  |  | 60,551 |
Consumer non real estate |  |  | 40,483 |  |  |  | 38,996 |
Gross loans |  | $ | 1,002,241 |  |  | $ | 857,175 |
Less unearned income and deferred fees and costs |  |  | (582 | ) |  |  | (529 | )
Loans, net of unearned income and deferred fees and costs |  | $ | 1,001,659 |  |  | $ | 856,646 |
Allowance for credit losses on loans |  |  | (10,328 | ) |  |  | (9,094 | )
Total loans, net |  | $ | 991,331 |  |  | $ | 847,552 |
Accrued interest receivable of $3,269 at September 30, 2024 and $3,032 at December 31, 2023 is not included in total loans above. Past Due and Nonaccrual Loans The following tables present the aging of past due loans, by loan pool, as of the dates indicated.
September 30, 2024 |  | Accruing Current Loans |  |  | Accruing Loans 30 – 89 Days Past Due |  |  | Accruing Loans 90 or More Days Past Due |  |  | Nonaccrual Loans |  |  | Total Loans |  |  | Accruing and Nonaccrual 90 or More Days Past Due |
Real Estate Construction |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Construction, 1-4 family residential |  | $ | 18,070 |  |  | $ | - |  |  | $ | - |  |  | $ | - |  |  | $ | 18,070 |  |  | $ | - |
Construction, other |  |  | 53,822 |  |  |  | 28 |  |  |  | - |  |  |  | - |  |  |  | 53,850 |  |  |  | - |
Consumer Real Estate |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Equity line |  |  | 22,253 |  |  |  | 90 |  |  |  | - |  |  |  | - |  |  |  | 22,343 |  |  |  | - |
Residential closed-end first liens |  |  | 169,444 |  |  |  | 930 |  |  |  | 84 |  |  |  | - |  |  |  | 170,458 |  |  |  | - |
Residential closed-end junior liens |  |  | 7,297 |  |  |  | 10 |  |  |  | - |  |  |  | - |  |  |  | 7,307 |  |  |  | - |
Investor-owned residential real estate |  |  | 105,142 |  |  |  | 762 |  |  |  | - |  |  |  | - |  |  |  | 105,904 |  |  |  | - |
Commercial Real Estate |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Multifamily residential real estate |  |  | 132,554 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 132,554 |  |  |  | - |
Commercial real estate owner-occupied |  |  | 140,800 |  |  |  | 322 |  |  |  | - |  |  |  | 2,283 |  |  |  | 143,405 |  |  |  | 215 |
Commercial real estate, other |  |  | 196,511 |  |  |  | 548 |  |  |  | - |  |  |  | - |  |  |  | 197,059 |  |  |  | - |
Commercial Non Real Estate |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial and industrial |  |  | 52,543 |  |  |  | 112 |  |  |  | 44 |  |  |  | - |  |  |  | 52,699 |  |  |  | 44 |
Public Sector and IDA |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
States and political subdivisions |  |  | 58,109 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 58,109 |  |  |  | - |
Consumer Non Real Estate |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Credit cards |  |  | 4,789 |  |  |  | 4 |  |  |  | 1 |  |  |  | - |  |  |  | 4,794 |  |  |  | 1 |
Automobile |  |  | 13,498 |  |  |  | 174 |  |  |  | - |  |  |  | - |  |  |  | 13,672 |  |  |  | - |
Other consumer loans |  |  | 21,721 |  |  |  | 270 |  |  |  | 26 |  |  |  | - |  |  |  | 22,017 |  |  |  | 26 |
Total |  | $ | 996,553 |  |  | $ | 3,250 |  |  | $ | 155 |  |  | $ | 2,283 |  |  | $ | 1,002,241 |  |  | $ | 286 |
December 31, 2023 |  | Accruing Current Loans |  |  | Accruing Loans 30 – 89 Days Past Due |  |  | Accruing Loans 90 or More Days Past Due |  |  | Nonaccrual Loans |  |  | Total Loans |  |  | Accruing and Nonaccrual 90 or More Days Past Due |
Real Estate Construction |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Construction, 1-4 family residential |  | $ | 13,442 |  |  | $ | - |  |  | $ | - |  |  | $ | - |  |  | $ | 13,442 |  |  | $ | - |
Construction, other |  |  | 41,916 |  |  |  | 21 |  |  |  | - |  |  |  | - |  |  |  | 41,937 |  |  |  | - |
Consumer Real Estate |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Equity line |  |  | 17,178 |  |  |  | 104 |  |  |  | - |  |  |  | - |  |  |  | 17,282 |  |  |  | - |
Residential closed-end first liens |  |  | 124,886 |  |  |  | 662 |  |  |  | 131 |  |  |  | - |  |  |  | 125,679 |  |  |  | 131 |
Residential closed-end junior liens |  |  | 5,027 |  |  |  | 12 |  |  |  | - |  |  |  | - |  |  |  | 5,039 |  |  |  | - |
Investor-owned residential real estate |  |  | 93,564 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 93,564 |  |  |  | - |
Commercial Real Estate |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Multifamily residential real estate |  |  | 119,052 |  |  |  | 195 |  |  |  | - |  |  |  | - |  |  |  | 119,247 |  |  |  | - |
Commercial real estate owner-occupied |  |  | 114,477 |  |  |  | 336 |  |  |  | - |  |  |  | 2,408 |  |  |  | 117,221 |  |  |  | 231 |
Commercial real estate, other |  |  | 182,662 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 182,662 |  |  |  | - |
Commercial Non Real Estate |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial and industrial |  |  | 41,249 |  |  |  | 57 |  |  |  | 28 |  |  |  | 221 |  |  |  | 41,555 |  |  |  | 28 |
Public Sector and IDA |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
States and political subdivisions |  |  | 60,551 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 60,551 |  |  |  | - |
Consumer Non Real Estate |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Credit cards |  |  | 4,648 |  |  |  | 17 |  |  |  | 3 |  |  |  | - |  |  |  | 4,668 |  |  |  | 3 |
Automobile |  |  | 12,126 |  |  |  | 135 |  |  |  | - |  |  |  | - |  |  |  | 12,261 |  |  |  | - |
Other consumer loans |  |  | 21,934 |  |  |  | 107 |  |  |  | 26 |  |  |  | - |  |  |  | 22,067 |  |  |  | 26 |
Total |  | $ | 852,712 |  |  | $ | 1,646 |  |  | $ | 188 |  |  | $ | 2,629 |  |  | $ | 857,175 |  |  | $ | 419 |
The following table presents nonaccrual loans, by loan class, as of the dates indicated:
|  | September 30, 2024 |  |  | December 31, 2023 |
|  | With No Allowance |  |  | With an Allowance |  |  | Total |  |  | With No Allowance |  |  | With an Allowance |  |  | Total |
Commercial Real Estate |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial real estate owner-occupied |  | $ | 2,068 |  |  | $ | 215 |  |  | $ | 2,283 |  |  | $ | 2,177 |  |  | $ | 231 |  |  | $ | 2,408 |
Commercial Non Real Estate |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial and industrial |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 221 |  |  |  | 221 |
Total |  | $ | 2,068 |  |  | $ | 215 |  |  | $ | 2,283 |  |  | $ | 2,177 |  |  | $ | 452 |  |  | $ | 2,629 |
During the three and nine months ended September 30, 2024, no accrued interest receivable was reversed against interest income. Allowance for Credit Losses on Loans (“ACLL”) The following tables present the activity in the ACLL by portfolio segment for the periods indicated:
|  | Activity in the ACLL for the Nine Months Ended September 30, 2024 |
|  | 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, 2023 |  | $ | 408 |  |  | $ | 3,162 |  |  | $ | 3,576 |  |  | $ | 682 |  |  | $ | 333 |  |  | $ | 583 |  |  | $ | 350 |  |  | $ | 9,094 |
Charge-offs |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (145 | ) |  |  | - |  |  |  | (266 | ) |  |  | - |  |  |  | (411 | )
Recoveries |  |  | - |  |  |  | - |  |  |  | 41 |  |  |  | 12 |  |  |  | - |  |  |  | 105 |  |  |  | - |  |  |  | 158 |
Provision for (recovery of) credit losses |  |  | 43 |  |  |  | 697 |  |  |  | 589 |  |  |  | 106 |  |  |  | 5 |  |  |  | 139 |  |  |  | (267 | ) |  |  | 1,312 |
Merger adjustment(1) |  |  | 10 |  |  |  | 97 |  |  |  | 55 |  |  |  | 4 |  |  |  | - |  |  |  | 9 |  |  |  | - |  |  |  | 175 |
Balance, September 30, 2024 |  | $ | 461 |  |  | $ | 3,956 |  |  | $ | 4,261 |  |  | $ | 659 |  |  | $ | 338 |  |  | $ | 570 |  |  | $ | 83 |  |  | $ | 10,328 |
(1) Adjustment for PCD acquired loans.
|  | Activity in the ACLL for the Nine Months Ended September 30, 2023 |
|  | 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, 2022 |  | $ | 450 |  |  | $ | 2,199 |  |  | $ | 3,642 |  |  | $ | 930 |  |  | $ | 319 |  |  | $ | 506 |  |  | $ | 179 |  |  | $ | 8,225 |
Adoption of ASU 2016-13 |  |  | (21 | ) |  |  | 1,261 |  |  |  | 700 |  |  |  | 216 |  |  |  | (15 | ) |  |  | 72 |  |  |  | 129 |  |  |  | 2,342 |
Charge-offs |  | – |  |  |  | (17 | ) |  | – |  |  |  | (11 | ) |  | – |  |  |  | (204 | ) |  | – |  |  |  | (232 | )
Recoveries |  | – |  |  |  | 103 |  |  |  | 37 |  |  |  | 4 |  |  | – |  |  |  | 91 |  |  | – |  |  |  | 235 |
Provision for (recovery of) credit losses |  |  | 133 |  |  |  | (353 | ) |  |  | (212 | ) |  |  | (300 | ) |  |  | 10 |  |  |  | 156 |  |  |  | 177 |  |  |  | (389 | )
Balance, September 30, 2023 |  | $ | 562 |  |  | $ | 3,193 |  |  | $ | 4,167 |  |  | $ | 839 |  |  | $ | 314 |  |  | $ | 621 |  |  | $ | 485 |  |  | $ | 10,181 |
|  | Activity in the ACLL for the Year Ended December 31, 2023 |
|  | 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, 2022 |  | $ | 450 |  |  | $ | 2,199 |  |  | $ | 3,642 |  |  | $ | 930 |  |  | $ | 319 |  |  | $ | 506 |  |  | $ | 179 |  |  | $ | 8,225 |
Adoption of ASU 2016-13 |  |  | (21 | ) |  |  | 1,261 |  |  |  | 700 |  |  |  | 216 |  |  |  | (15 | ) |  |  | 72 |  |  |  | 129 |  |  |  | 2,342 |
Charge-offs |  | – |  |  |  | (17 | ) |  | – |  |  |  | (214 | ) |  | – |  |  |  | (247 | ) |  | – |  |  |  | (478 | )
Recoveries |  | – |  |  |  | 103 |  |  |  | 45 |  |  |  | 6 |  |  | – |  |  |  | 129 |  |  | – |  |  |  | 283 |
Provision for (recovery of) for credit losses |  |  | (21 | ) |  |  | (384 | ) |  |  | (811 | ) |  |  | (256 | ) |  |  | 29 |  |  |  | 123 |  |  |  | 42 |  |  |  | (1,278 | )
Balance, December 31, 2023 |  | $ | 408 |  |  | $ | 3,162 |  |  | $ | 3,576 |  |  | $ | 682 |  |  | $ | 333 |  |  | $ | 583 |  |  | $ | 350 |  |  | $ | 9,094 |
The following tables present information about the ACLL for individually evaluated loans and collectively evaluated loans by portfolio segment as of the dates indicated.
|  | ACLL by Segment and Evaluation Method |
September 30, 2024 |  | 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 |  | $ | – |  |  | $ | 34 |  |  | $ | 51 |  |  | $ | – |  |  | $ | – |  |  | $ | – |  |  | $ | – |  |  | $ | 85 |
Collectively evaluated |  |  | 461 |  |  |  | 3,922 |  |  |  | 4,210 |  |  |  | 659 |  |  |  | 338 |  |  |  | 570 |  |  |  | 83 |  |  |  | 10,243 |
Total |  | $ | 461 |  |  | $ | 3,956 |  |  | $ | 4,261 |  |  | $ | 659 |  |  | $ | 338 |  |  | $ | 570 |  |  | $ | 83 |  |  | $ | 10,328 |
|  | ACLL by Segment and Evaluation Method |
December 31, 2023 |  | 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 |  | $ | – |  |  | $ | 74 |  |  | $ | 367 |  |  | $ | 126 |  |  | $ | – |  |  | $ | 5 |  |  | $ | – |  |  | $ | 572 |
Collectively evaluated |  |  | 408 |  |  |  | 3,088 |  |  |  | 3,209 |  |  |  | 556 |  |  |  | 333 |  |  |  | 578 |  |  |  | 350 |  |  |  | 8,522 |
Total |  | $ | 408 |  |  | $ | 3,162 |  |  | $ | 3,576 |  |  | $ | 682 |  |  | $ | 333 |  |  | $ | 583 |  |  | $ | 350 |  |  | $ | 9,094 |
The following tables present information about individually evaluated loans and collectively evaluated loans by portfolio segment as of the dates indicated.
|  | Loans by Segment and Evaluation Method as of |
September 30, 2024 |  | Real Estate Construction |  |  | Consumer Real Estate |  |  | Commercial Real Estate |  |  | Commercial Non Real Estate |  |  | Public Sector and IDA |  |  | Consumer Non Real Estate |  |  | Total |
Individually evaluated |  | $ | – |  |  | $ | 591 |  |  | $ | 10,122 |  |  | $ | – |  |  | $ | – |  |  | $ | 0 |  |  | $ | 10,713 |
Collectively evaluated |  |  | 71,920 |  |  |  | 305,421 |  |  |  | 462,896 |  |  |  | 52,699 |  |  |  | 58,109 |  |  |  | 40,483 |  |  |  | 991,528 |
Total |  | $ | 71,920 |  |  | $ | 306,012 |  |  | $ | 473,018 |  |  | $ | 52,699 |  |  | $ | 58,109 |  |  | $ | 40,483 |  |  | $ | 1,002,241 |
|  | Loans by Segment and Evaluation Method as of |
December 31, 2023 |  | Real Estate Construction |  |  | Consumer Real Estate |  |  | Commercial Real Estate |  |  | Commercial Non Real Estate |  |  | Public Sector and IDA |  |  | Consumer Non Real Estate |  |  | Total |
Individually evaluated |  | $ | 286 |  |  | $ | 1,183 |  |  | $ | 8,805 |  |  | $ | 227 |  |  | $ | – |  |  | $ | 43 |  |  | $ | 10,544 |
Collectively evaluated |  |  | 55,093 |  |  |  | 240,381 |  |  |  | 410,325 |  |  |  | 41,328 |  |  |  | 60,551 |  |  |  | 38,953 |  |  |  | 846,631 |
Total |  | $ | 55,379 |  |  | $ | 241,564 |  |  | $ | 419,130 |  |  | $ | 41,555 |  |  | $ | 60,551 |  |  | $ | 38,996 |  |  | $ | 857,175 |
Collateral Dependent Loans Loans are collateral dependent when repayment is expected substantially through the operation or sale of the collateral and the borrower is experiencing financial difficulty. Collateral dependent loans are individually evaluated. The Company measures the ACLL on collateral dependent loans based upon the fair value of the collateral, as permitted by ASU 2016-13. Fair value of the collateral is adjusted for liquidation costs/discounts. If the fair value of the collateral falls below the amortized cost of the loan, the shortfall is recognized in the ACLL. If the fair value of the collateral exceeds the amortized cost, no ACLL is required. As of September 30, 2024, four of the Company’s individually evaluated loans were collateral dependent. As of December 31, 2023, three of the Company’s individually evaluated loans were collateral dependent. All collateral dependent loans were secured by real estate as of September 30, 2024 and December 31, 2023. The following table details the amortized cost of the collateral dependent loans as of the dates indicated:
|  | September 30, 2024 |  |  | December 31, 2023 |
|  | Balance |  |  | Related Allowance |  |  | Balance |  |  | Related Allowance |
Consumer Real Estate |  |  |  |  |  |  |  |  |  |  |  |
Residential closed-end first lien |  | $ | 84 |  |  | $ | – |  |  | $ | 7 |  |  | $ | – |
Commercial Real Estate |  |  |  |  |  |  |  |  |  |  |  |
Commercial real estate, owner occupied |  |  | 8,464 |  |  |  | – |  |  |  | 2,177 |  |  |  | – |
Commercial real estate, other |  |  | 880 |  |  |  | – |  |  |  | – |  |  |  | – |
Total Loans |  | $ | 9,428 |  |  | $ | – |  |  | $ | 2,184 |  |  | $ | – |
Credit Quality The Company categorizes loans by risk based on relevant information about the ability of borrowers to service their debt, including: collateral and financial information, historical payment experience, credit documentation and current economic trends, among other factors. At origination, each loan is assigned a risk rating. Ongoing analysis of the loan portfolio adjusts risk ratings on an individual loan basis to reflect updated information. Loans rated pass have acceptable credit quality. Loans rated special mention have potential weakness due to challenging economic or financial conditions. Loans rated classified have well-defined weaknesses that heighten the risk of default. The tables below present the loan portfolio by amortized cost basis, year of origination, loan class and credit quality, and gross charge-offs for the nine months ended September 30, 2024 and year ended December 31, 2023.
|  | Term Loans Amortized Cost Basis by Origination Year |  |  |  | Revolving Loans Converted |  |  |
September 30, 2024 |  | Prior |  | 2020 |  | 2021 |  | 2022 |  | 2023 |  | 2024 |  | Revolving |  | to Term |  | Total |
Construction, residential |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  | $ | 170 |  | $ | 60 |  | $ | 163 |  | $ | 691 |  | $ | 4,561 |  | $ | 1,511 |  | $ | 10,914 |  | $ | — |  | $ | 18,070 |
Construction, other |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  | $ | 2,859 |  | $ | 1,103 |  | $ | 7,923 |  | $ | 22,163 |  | $ | 7,334 |  | $ | 7,465 |  | $ | 4,731 |  | $ | — |  | $ | 53,578 |
Classified |  |  | — |  |  | — |  |  | 272 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 272 |
Total |  | $ | 2,859 |  | $ | 1,103 |  | $ | 8,195 |  | $ | 22,163 |  | $ | 7,334 |  | $ | 7,465 |  | $ | 4,731 |  | $ | — |  | $ | 53,850 |
Equity lines |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  | $ | 372 |  | $ | 335 |  | $ | 408 |  | $ | 486 |  | $ | 938 |  | $ | 93 |  | $ | 19,621 |  | $ | — |  | $ | 22,253 |
Classified |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | – |  |  | 90 |  |  | — |  |  | 90 |
Total |  | $ | 372 |  | $ | 335 |  | $ | 408 |  | $ | 486 |  | $ | 938 |  | $ | 93 |  | $ | 19,711 |  | $ | — |  | $ | 22,343 |
Residential closed-end first liens |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  | $ | 41,446 |  | $ | 18,265 |  | $ | 34,985 |  | $ | 37,415 |  | $ | 20,325 |  | $ | 16,572 |  | $ | — |  | $ | 305 |  | $ | 169,313 |
Special Mention |  |  | 369 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 369 |
Classified |  |  | 776 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 776 |
Total |  | $ | 42,591 |  | $ | 18,265 |  | $ | 34,985 |  | $ | 37,415 |  | $ | 20,325 |  | $ | 16,572 |  | $ | — |  | $ | 305 |  | $ | 170,458 |
Residential closed-end junior liens |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  | $ | 1,637 |  | $ | — |  | $ | 284 |  | $ | 2,066 |  | $ | 1,663 |  | $ | 1,630 |  | $ | 27 |  | $ | — |  | $ | 7,307 |
Investor-owned residential real estate |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  | $ | 29,550 |  | $ | 23,305 |  | $ | 19,409 |  | $ | 16,420 |  | $ | 8,309 |  | $ | 3,030 |  | $ | 2,066 |  | $ | 2,554 |  | $ | 104,643 |
Special Mention |  |  | — |  |  | — |  |  | — |  |  | 140 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 140 |
Classified |  |  | 751 |  |  | — |  |  | 169 |  |  | 35 |  |  | 166 |  |  | — |  |  | — |  |  | — |  |  | 1,121 |
Total |  | $ | 30,301 |  | $ | 23,305 |  | $ | 19,578 |  | $ | 16,595 |  | $ | 8,475 |  | $ | 3,030 |  | $ | 2,066 |  | $ | 2,554 |  | $ | 105,904 |
Multifamily residential real estate |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  | $ | 40,280 |  | $ | 2,097 |  | $ | 40,166 |  | $ | 28,004 |  | $ | 8,614 |  | $ | 13,243 |  | $ | 150 |  | $ | — |  | $ | 132,554 |
Commercial real estate, owner occupied |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  | $ | 54,180 |  | $ | 24,811 |  | $ | 7,546 |  | $ | 29,283 |  | $ | 10,495 |  | $ | 3,528 |  | $ | 3,915 |  | $ | 84 |  | $ | 133,842 |
Special mention |  |  | 6,396 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 6,396 |
Classified |  |  | 2,404 |  |  | 748 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 15 |  |  | — |  |  | 3,167 |
Total |  | $ | 62,980 |  | $ | 25,559 |  | $ | 7,546 |  | $ | 29,283 |  | $ | 10,495 |  | $ | 3,528 |  | $ | 3,930 |  | $ | 84 |  | $ | 143,405 |
Commercial real estate, other |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  | $ | 91,828 |  | $ | 18,117 |  | $ | 37,922 |  | $ | 24,009 |  | $ | 17,112 |  | $ | 5,519 |  | $ | 1,857 |  | $ | — |  | $ | 196,364 |
Special Mention |  |  | 695 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 695 |
Total |  | $ | 92,523 |  | $ | 18,117 |  | $ | 37,922 |  | $ | 24,009 |  | $ | 17,112 |  | $ | 5,519 |  | $ | 1,857 |  | $ | — |  | $ | 197,059 |
Commercial and industrial |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  | $ | 6,539 |  | $ | 2,241 |  | $ | 12,256 |  | $ | 5,860 |  | $ | 6,680 |  | $ | 7,042 |  | $ | 12,041 |  | $ | 12 |  | $ | 52,671 |
Special Mention |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 22 |  |  | — |  |  | 22 |
Classified |  |  | — |  |  | — |  |  | — |  |  | 6 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 6 |
Total |  | $ | 6,539 |  | $ | 2,241 |  | $ | 12,256 |  | $ | 5,866 |  | $ | 6,680 |  | $ | 7,042 |  | $ | 12,063 |  | $ | 12 |  | $ | 52,699 |
YTD gross charge-offs |  | $ | 125 |  | $ | — |  | $ | — |  | $ | — |  | $ | — |  | $ | — |  | $ | 20 |  | $ | — |  | $ | 145 |
Public sector and IDA |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  | $ | 19,421 |  | $ | 223 |  | $ | 25,978 |  | $ | 6,025 |  | $ | 6,462 |  | $ | — |  | $ | — |  | $ | — |  | $ | 58,109 |
Credit cards |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  | $ | — |  | $ | — |  | $ | — |  | $ | — |  | $ | — |  | $ | — |  | $ | 4,794 |  | $ | — |  | $ | 4,794 |
YTD gross charge-offs |  | $ | — |  | $ | — |  | $ | — |  | $ | — |  | $ | — |  | $ | — |  | $ | 43 |  | $ | — |  | $ | 43 |
Automobile |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  | $ | 55 |  | $ | 324 |  | $ | 915 |  | $ | 1,953 |  | $ | 5,091 |  | $ | 5,252 |  | $ | — |  | $ | — |  | $ | 13,590 |
Special Mention |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 4 |  |  | — |  |  | — |  |  | — |  |  | 4 |
Classified |  |  | — |  |  | — |  |  | — |  |  | 5 |  |  | 73 |  |  | — |  |  | — |  |  | — |  |  | 78 |
Total |  | $ | 55 |  | $ | 404 |  | $ | 1,139 |  | $ | 2,181 |  | $ | 6,019 |  | $ | 3,905 |  | $ | — |  | $ | — |  | $ | 13,672 |
YTD gross charge-offs |  | $ | — |  | $ | — |  | $ | — |  | $ | 9 |  | $ | 13 |  | $ | 11 |  | $ | — |  | $ | — |  | $ | 33 |
Other consumer |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  | $ | 264 |  | $ | 496 |  | $ | 1,151 |  | $ | 2,807 |  | $ | 7,115 |  | $ | 9,422 |  | $ | 724 |  | $ | — |  | $ | 21,979 |
Special Mention |  |  | — |  |  | — |  |  | 1 |  |  | — |  |  | — |  |  | 10 |  |  | — |  |  | — |  |  | 11 |
Classified |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 5 |  |  | 22 |  |  | — |  |  | — |  |  | 27 |
Total |  | $ | 264 |  | $ | 496 |  | $ | 1,152 |  | $ | 2,807 |  | $ | 7,120 |  | $ | 9,454 |  | $ | 724 |  | $ | — |  | $ | 22,017 |
YTD gross charge-offs |  | $ | — |  | $ | 4 |  | $ | 15 |  | $ | 17 |  | $ | 74 |  | $ | 80 |  | $ | — |  | $ | — |  | $ | 190 |
Total Loans |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  | $ | 288,601 |  | $ | 91,377 |  | $ | 189,106 |  | $ | 177,182 |  | $ | 104,699 |  | $ | 74,307 |  | $ | 60,840 |  | $ | 2,955 |  | $ | 989,067 |
Special Mention |  |  | 7,460 |  |  | — |  |  | 1 |  |  | 140 |  |  | 4 |  |  | 10 |  |  | 22 |  |  | — |  |  | 7,637 |
Classified |  |  | 3,931 |  |  | 748 |  |  | 441 |  |  | 46 |  |  | 244 |  |  | 22 |  |  | 105 |  |  | — |  |  | 5,537 |
Total |  | $ | 299,992 |  | $ | 92,125 |  | $ | 189,548 |  | $ | 177,368 |  | $ | 104,947 |  | $ | 74,339 |  | $ | 60,967 |  | $ | 2,955 |  | $ | 1,002,241 |
YTD gross charge-offs |  | $ | 125 |  | $ | 4 |  | $ | 15 |  | $ | 26 |  | $ | 87 |  | $ | 91 |  | $ | 63 |  | $ | – |  | $ | 411 |
|  | Term Loans Amortized Cost Basis by Origination Year |  |  |  | Revolving Loans Converted |  |  |
December 31, 2023 |  | Prior |  | 2019 |  | 2020 |  | 2021 |  | 2022 |  | 2023 |  | Revolving |  | to Term |  | Total |
Construction, residential |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  | $ | – |  | $ | – |  | $ | 246 |  | $ | 158 |  | $ | 3,275 |  | $ | 5,157 |  | $ | 4,606 |  | $ | – |  | $ | 13,442 |
Construction, other |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  | $ | 2,741 |  | $ | 1,094 |  | $ | 1,305 |  | $ | 12,671 |  | $ | 17,397 |  | $ | 4,884 |  | $ | 1,559 |  | $ | – |  | $ | 41,651 |
Classified |  |  | – |  |  | – |  |  | – |  |  | 286 |  |  | – |  |  | – |  |  | – |  |  | – |  |  | 286 |
Total |  | $ | 2,741 |  | $ | 1,094 |  | $ | 1,305 |  | $ | 12,957 |  | $ | 17,397 |  | $ | 4,884 |  | $ | 1,559 |  | $ | – |  | $ | 41,937 |
Equity lines |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  | $ | 51 |  | $ | – |  | $ | – |  | $ | – |  | $ | – |  | $ | – |  | $ | 17,182 |  | $ | – |  | $ | 17,233 |
Classified |  |  | – |  |  | – |  |  | – |  |  | – |  |  | – |  |  | – |  |  | 49 |  |  | – |  |  | 49 |
Total |  | $ | 51 |  | $ | – |  | $ | – |  | $ | – |  | $ | – |  | $ | – |  | $ | 17,231 |  | $ | – |  | $ | 17,282 |
Residential closed-end first liens |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  | $ | 32,404 |  | $ | 5,806 |  | $ | 14,634 |  | $ | 31,414 |  | $ | 29,787 |  | $ | 11,208 |  | $ | – |  | $ | – |  | $ | 125,253 |
Classified |  |  | 426 |  |  | – |  |  | – |  |  | – |  |  | – |  |  | – |  |  | – |  |  | – |  |  | 426 |
Total |  | $ | 32,830 |  | $ | 5,806 |  | $ | 14,634 |  | $ | 31,414 |  | $ | 29,787 |  | $ | 11,208 |  | $ | – |  | $ | – |  | $ | 125,679 |
YTD gross charge-offs |  | $ | – |  | $ | – |  | $ | 17 |  | $ | – |  | $ | – |  | $ | – |  | $ | – |  | $ | – |  | $ | 17 |
Residential closed-end junior liens |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  | $ | 1,499 |  | $ | 116 |  | $ | – |  | $ | 172 |  | $ | 1,387 |  | $ | 1,850 |  | $ | – |  | $ | 15 |  | $ | 5,039 |
Investor-owned residential real estate |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  | $ | 24,556 |  | $ | 5,162 |  | $ | 23,649 |  | $ | 19,062 |  | $ | 14,166 |  | $ | 4,880 |  | $ | 1,283 |  | $ | 98 |  | $ | 92,856 |
Classified |  |  | 708 |  |  | – |  |  | – |  |  | – |  |  | – |  |  | – |  |  | – |  |  | – |  |  | 708 |
Total |  | $ | 25,264 |  | $ | 5,162 |  | $ | 23,649 |  | $ | 19,062 |  | $ | 14,166 |  | $ | 4,880 |  | $ | 1,283 |  | $ | 98 |  | $ | 93,564 |
Multifamily residential real estate |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  | $ | 40,092 |  | $ | 1,806 |  | $ | 2,148 |  | $ | 40,544 |  | $ | 25,681 |  | $ | 8,850 |  | $ | 126 |  | $ | – |  | $ | 119,247 |
Commercial real estate, owner occupied |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  | $ | 41,573 |  | $ | 11,091 |  | $ | 23,407 |  | $ | 4,792 |  | $ | 16,720 |  | $ | 7,914 |  | $ | 2,919 |  | $ | – |  | $ | 108,416 |
Special mention |  |  | 6,396 |  |  | – |  |  | – |  |  | – |  |  | – |  |  | – |  |  | – |  |  | – |  |  | 6,396 |
Classified |  |  | 2,409 |  |  | – |  |  | – |  |  | – |  |  | – |  |  | – |  |  | – |  |  | – |  |  | 2,409 |
Total |  | $ | 50,378 |  | $ | 11,091 |  | $ | 23,407 |  | $ | 4,792 |  | $ | 16,720 |  | $ | 7,914 |  | $ | 2,919 |  | $ | – |  | $ | 117,221 |
Commercial real estate, other |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  | $ | 68,889 |  | $ | 21,841 |  | $ | 19,098 |  | $ | 36,157 |  | $ | 22,697 |  | $ | 13,279 |  | $ | 701 |  | $ | – |  | $ | 182,662 |
Commercial and industrial |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  | $ | 6,004 |  | $ | 438 |  | $ | 1,060 |  | $ | 12,667 |  | $ | 6,954 |  | $ | 6,938 |  | $ | 7,267 |  | $ | – |  | $ | 41,328 |
Classified |  |  | 220 |  |  | – |  |  | – |  |  | – |  |  | 7 |  |  | – |  |  | – |  |  | – |  |  | 227 |
Total |  | $ | 6,224 |  | $ | 438 |  | $ | 1,060 |  | $ | 12,667 |  | $ | 6,961 |  | $ | 6,938 |  | $ | 7,267 |  | $ | – |  | $ | 41,555 |
YTD gross charge-offs |  | $ | – |  | $ | 12 |  | $ | – |  | $ | – |  | $ | – |  | $ | 12 |  | $ | 190 |  | $ | – |  | $ | 214 |
Public sector and IDA |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  | $ | 20,817 |  | $ | – |  | $ | 235 |  | $ | 26,702 |  | $ | 6,335 |  | $ | 6,462 |  | $ | – |  | $ | – |  | $ | 60,551 |
Credit cards |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  | $ | – |  | $ | – |  | $ | – |  | $ | – |  | $ | – |  | $ | – |  | $ | 4,668 |  | $ | – |  | $ | 4,668 |
YTD gross charge-offs |  | $ | – |  | $ | – |  | $ | – |  | $ | – |  | $ | – |  | $ | – |  | $ | 39 |  | $ | – |  | $ | 39 |
Automobile |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  | $ | 78 |  | $ | 204 |  | $ | 563 |  | $ | 1,619 |  | $ | 2,750 |  | $ | 7,047 |  | $ | – |  | $ | – |  | $ | 12,261 |
YTD gross charge-offs |  | $ | – |  | $ | 3 |  | $ | – |  | $ | 1 |  | $ | 38 |  | $ | – |  | $ | – |  | $ | – |  | $ | 42 |
Other Consumer |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  | $ | 93 |  | $ | 334 |  | $ | 811 |  | $ | 1,943 |  | $ | 5,815 |  | $ | 12,356 |  | $ | 672 |  | $ | – |  | $ | 22,024 |
Special mention |  |  | – |  |  | – |  |  | – |  |  | – |  |  | – |  |  | 17 |  |  | – |  |  | – |  |  | 17 |
Classified |  |  | – |  |  | – |  |  | – |  |  | – |  |  | 11 |  |  | 15 |  |  | – |  |  | – |  |  | 26 |
Total |  | $ | 93 |  | $ | 334 |  | $ | 811 |  | $ | 1,943 |  | $ | 5,826 |  | $ | 12,388 |  | $ | 672 |  | $ | – |  | $ | 22,067 |
YTD gross charge-offs |  | $ | – |  | $ | – |  | $ | – |  | $ | 19 |  | $ | 52 |  | $ | 95 |  | $ | – |  | $ | – |  | $ | 166 |
Total Loans |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  | $ | 238,797 |  | $ | 47,892 |  | $ | 87,156 |  | $ | 187,901 |  | $ | 152,964 |  | $ | 90,825 |  | $ | 40,983 |  | $ | 113 |  | $ | 846,631 |
Special mention |  |  | 6,396 |  |  | – |  |  | – |  |  | – |  |  | – |  |  | 17 |  |  | – |  |  | – |  |  | 6,413 |
Classified |  |  | 3,763 |  |  | – |  |  | – |  |  | 286 |  |  | 18 |  |  | 15 |  |  | 49 |  |  | – |  |  | 4,131 |
Total |  | $ | 248,956 |  | $ | 47,892 |  | $ | 87,156 |  | $ | 188,187 |  | $ | 152,982 |  | $ | 90,857 |  | $ | 41,032 |  | $ | 113 |  | $ | 857,175 |
YTD gross charge-offs |  | $ | – |  | $ | 15 |  | $ | 17 |  | $ | 20 |  | $ | 90 |  | $ | 107 |  | $ | 229 |  | $ | – |  | $ | 478 |
Loan Modifications to Borrowers Experiencing Financial Difficulty The Company modifies loans for a variety of reasons. At the date of modification, the Company assesses whether the borrower is experiencing financial difficulty. If the borrower is experiencing financial difficulty, the loan’s risk rating is evaluated and is typically changed to special mention or classified, which results in individual evaluation of the loan for the ACLL. Two loans were modified for borrowers experiencing financial difficulty during the first three months of 2024. These loans were modified again during the three months ended September 30, 2024. There was one loan to a borrower experiencing financial difficulty that was modified during the nine months ended September 30, 2023. The following table presents information as of September 30, 2024 about loans modified for borrowers experiencing financial difficulty during the nine months ended September 30, 2024.
September 30, 2024 |  | Amortized Cost Basis |  |  | % of Class |  |  | Type of Modification |  | Financial Effect
Commercial Real Estate |  |  |  |  |  |  |  |  |  |
Commercial real estate owner-occupied |  | $ | 6,396 |  |  |  | 4.40 | % |  | Interest only payments |  | 3 months of interest only payments, re-amortization of the balance to contractual maturity.
Commercial Non real estate |  |  |  |  |  |  |  |  |  |
Commercial and industrial |  | $ | 6 |  |  |  | 0.01 | % |  | Term extension |  | Renewal of single-payment note for an additional 3 months.
The following table presents information as of September 30, 2023 about loans modified for borrowers experiencing financial difficulty during the nine months ended September 30, 2023.
September 30, 2023 |  | Amortized Cost Basis |  |  | % of Class |  |  | Type of Modification | Financial Effect
Commercial Real Estate |  |  |  |  |  |  |  |  |
Commercial real estate owner-occupied |  | $ | 6,396 |  |  |  | 5.38 | % |  | Interest only payments | 6 months of interest only payments, re-amortization of the balance to contractual maturity.
The Company closely monitors the performance of loans that are modified to borrowers experiencing financial difficulty. Both loans are in current status as of September 30, 2024. There were no loans to borrowers experiencing financial difficulty that had a payment default during the three or nine months ended September 30, 2024 and 2023 and were modified in the twelve months prior to that default. Default is determined at 90 or more days past due, upon charge-off, or upon foreclosure. Modified loans in default are individually evaluated for the allowance for credit losses or if the modified loan is deemed uncollectible, the loan, or a portion of the loan, is written off and the allowance for credit losses is adjusted accordingly. Consumer Real Estate Loans In Process of Foreclosure As of September 30, 2024, the Company had three consumer real estate loans totaling $397 in process of foreclosure. As of December 31, 2023, one consumer real estate loan of $7 was in process of foreclosure. ACL for Unfunded Commitments The following tables present the balance and activity in the ACL for unfunded commitments for the nine months ended September 30, 2024 and 2023:
Allowance for Credit Losses on Unfunded Commitments |
Balance, December 31, 2023 |  | $ | 259 |
Recovery of credit losses |  |  | (25 | )
FCB acquisition |  |  | 7 |
Balance, September 30, 2024 |  | $ | 241 |
Allowance for Credit Losses on Unfunded Commitments |
Balance, December 31, 2022 |  | $ | 35 |
Adoption of ASU 2016-13 |  |  | 207 |
Recovery of credit losses |  |  | 21 |
Balance, September 30, 2023 |  | $ | 263 |

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