XML 21 R14.htm IDEA: XBRL DOCUMENT

Note 3 - Loans and Allowance for Credit Losses

3 Months Ended

Mar. 31, 2025

Note 3: Loans and Allowance for Credit Losses

Loans

Loans include acquired loans and originated loans. Acquired loans are presented at their outstanding principal balance, net of the remaining purchase discount of $7,312 as of March 31, 2025 and $7,564 as of December 31, 2024. Originated loans as of March 31, 2025 and December 31, 2024 are presented at amortized cost, net of 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.


	March 31,			December 31,
	2025			2024
Real estate construction	$	42,942		$	50,798
Consumer real estate		311,549			307,855
Commercial real estate		497,072			478,078
Commercial non real estate		53,156			51,844
Public sector and IDA		56,981			57,171
Consumer non real estate		42,205			42,867
Gross loans	$	1,003,905		$	988,613
Less deferred fees and costs		(641	)		(663	)
Loans, net of deferred fees and costs	$	1,003,264		$	987,950
Allowance for credit losses on loans		(10,490	)		(10,262	)
Total loans, net	$	992,774		$	977,688

Accrued interest receivable of $3,384 at March 31, 2025 and $3,299 at December 31, 2024 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.


March 31, 2025	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	$	14,605	$	-	$	-	$	-	$	14,605	$	-
Construction, other		28,323		14		-		-		28,337		-
Consumer Real Estate
Equity line		22,783		-		-		-		22,783		-
Residential closed-end first liens		174,969		209		-		-		175,178		-
Residential closed-end junior liens		9,283		8		-		-		9,291		-
Investor-owned residential real estate		104,175		122		-		-		104,297		-
Commercial Real Estate
Multifamily residential real estate		158,965		196		-		-		159,161		-
Commercial real estate owner-occupied		136,829		147		-		2,173		139,149		204
Commercial real estate, other		198,217		545		-		-		198,762		-
Commercial Non Real Estate
Commercial and industrial		52,680		338		138		-		53,156		138
Public Sector and IDA
States and political subdivisions		56,981		-		-		-		56,981		-
Consumer Non Real Estate
Credit cards		4,402		2		3		-		4,407		3
Automobile		12,662		161		5		-		12,828		5
Other consumer loans		24,822		128		20		-		24,970		20
Total	$	999,696	$	1,870	$	166	$	2,173	$	1,003,905	$	370


December 31, 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	$	16,162	$	-	$	-	$	-	$	16,162	$	-
Construction, other		34,636		-		-		-		34,636		-
Consumer Real Estate
Equity line		22,551		67		-		-		22,618		-
Residential closed-end first liens		170,110		949		323		-		171,382		323
Residential closed-end junior liens		8,565		9		-		-		8,574		-
Investor-owned residential real estate		104,756		347		178		-		105,281		178
Commercial Real Estate
Multifamily residential real estate		143,444		186		-		-		143,630		-
Commercial real estate owner-occupied		138,284		147		-		2,222		140,653		209
Commercial real estate, other		193,249		546		-		-		193,795		-
Commercial Non Real Estate
Commercial and industrial		51,547		253		44		-		51,844		44
Public Sector and IDA
States and political subdivisions		57,171		-		-		-		57,171		-
Consumer Non Real Estate
Credit cards		4,696		2		-		-		4,698		-
Automobile		12,802		193		-		-		12,995		-
Other consumer loans		24,921		250		3		-		25,174		3
Total	$	982,894	$	2,949	$	548	$	2,222	$	988,613	$	757

The following table presents nonaccrual loans, by loan class, as of the dates indicated:


	March 31, 2025						December 31, 2024
	With No Allowance		With an Allowance		Total		With No Allowance		With an Allowance		Total
Commercial Real Estate
Commercial real estate owner-occupied	$	1,969	$	204	$	2,173	$	2,013	$	209	$	2,222
Total	$	1,969	$	204	$	2,173	$	2,013	$	209	$	2,222

No accrued interest receivable was reversed against interest income during the three months ended March 31, 2025 or March 31, 2024.

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 Three Months Ended March 31, 2025
	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, 2024	$	348		$	3,926		$	4,299	$	655		$	336	$	648		$	50		$	10,262
Charge-offs		-			(3	)		-		-			-		(109	)		-			(112	)
Recoveries		-			-			8		30			-		25			-			63
Provision for (recovery of) credit losses		(18	)		(32	)		284		(22	)		15		65			(15	)		277
Balance, March 31, 2025	$	330		$	3,891		$	4,591	$	663		$	351	$	629		$	35		$	10,490


	Activity in the ACLL for the Three Months Ended March 31, 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		-			-			-		-			-			(109	)		-		(109	)
Recoveries		-			-			16		2			-			47			-		65
Provision for (recovery of) credit losses		(59	)		(194	)		264		(37	)		(12	)		12			31		5
Balance, March 31, 2024	$	349		$	2,968		$	3,856	$	647		$	321		$	533		$	381	$	9,055


	Activity in the ACLL for the Year Ended December 31, 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		-			-		-		(166	)		-		(353	)		-			(519	)
Recoveries		-			-		53		79			-		138			-			270
Provision for (recovery of) credit losses		(70	)		667		615		56			3		271			(300	)		1,242
Merger adjustment(1)		10			97		55		4			-		9			-			175
Balance, December 31, 2024	$	348		$	3,926	$	4,299	$	655		$	336	$	648		$	50		$	10,262

(1) Adjustment for PCD acquired loans.

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
March 31, 2025	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	$	–	$	29	$	47	$	–	$	–	$	–	$	–	$	76
Collectively evaluated		330		3,862		4,544		663		351		629		35		10,414
Total	$	330	$	3,891	$	4,591	$	663	$	351	$	629	$	35	$	10,490


	ACLL by Segment and Evaluation Method
December 31, 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	$	-	$	31	$	49	$	-	$	-	$	-	$	-	$	80
Collectively evaluated		348		3,895		4,250		655		336		648		50		10,182
Total	$	348	$	3,926	$	4,299	$	655	$	336	$	648	$	50	$	10,262

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
March 31, 2025	Real Estate Construction		Consumer Real Estate		Commercial Real Estate		Commercial Non Real Estate		Public Sector and IDA		Consumer Non Real Estate		Total
Individually evaluated	$	–	$	486	$	9,928	$	–	$	–	$	–	$	10,414
Collectively evaluated		42,942		311,063		487,144		53,156		56,981		42,205		993,491
Total	$	42,942	$	311,549	$	497,072	$	53,156	$	56,981	$	42,205	$	1,003,905


	Loans by Segment and Evaluation Method
December 31, 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	$	-	$	497	$	10,024	$	-	$	-	$	-	$	10,521
Collectively evaluated		50,798		307,358		468,054		51,844		57,171		42,867		978,092
Total	$	50,798	$	307,855	$	478,078	$	51,844	$	57,171	$	42,867	$	988,613

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. 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 March 31, 2025, three of the Company’s individually evaluated loans were collateral dependent. As of December 31, 2024, three of the Company’s individually evaluated loans were collateral dependent. All collateral dependent loans were secured by real estate as of March 31, 2025 and December 31, 2024. The following table provides detail on collateral dependent loans as of the dates indicated:


	March 31, 2025				December 31, 2024
	Balance		Related Allowance		Balance		Related Allowance
Commercial Real Estate
Commercial real estate, owner occupied	$	8,313	$	-	$	8,387	$	-
Commercial real estate, other		686		-		872		-
Total Loans	$	8,999	$	-	$	9,259	$	-

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, payment history, 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. General descriptions of risk ratings are as follows:

•

Pass: loans with acceptable credit quality are rated pass.

•

Special mention: loans with potential weakness due to challenging economic or financial conditions are rated special mention.

•

Classified: loans with well-defined weaknesses that heighten the risk of default are rated classified.

The following tables present the amortized cost basis of the loan portfolio by year of origination, loan class and credit quality as of March 31, 2025 and December 31, 2024, and gross charge-offs by year of origination for the three months ended March 31, 2025 and the year ended December 31, 2024.


	Term Loans Amortized Cost Basis by Origination Year														Revolving Loans Converted
March 31, 2025	Prior		2021		2022		2023		2024		2025		Revolving		to Term		Total
Construction, residential
Pass	$	-	$	-	$	397	$	877	$	3,181	$	277	$	9,873	$	-	$	14,605
Construction, other
Pass	$	3,988	$	791	$	1,717	$	10,152	$	3,228	$	3,146	$	5,315	$	-	$	28,337
Equity lines
Pass	$	598	$	372	$	569	$	720	$	482	$	-	$	20,042	$	-	$	22,783
Residential closed-end first liens
Pass	$	57,640	$	33,634	$	34,962	$	22,239	$	22,212	$	3,599	$	406	$	-	$	174,692
Special Mention		364		-		-		-		-		-		-		-		364
Classified		-		-		-		122		-		-		-		-		122
Total	$	58,004	$	33,634	$	34,962	$	22,361	$	22,212	$	3,599	$	406	$	-	$	175,178
YTD gross charge-offs	$	3	$	-	$	-	$	-	$	-	$	-	$	-	$	-	$	3
Residential closed-end junior liens
Pass	$	1,588	$	269	$	2,031	$	1,552	$	2,974	$	846	$	31	$	-	$	9,291
Investor-owned residential real estate
Pass	$	50,550	$	18,435	$	15,512	$	9,303	$	4,158	$	3,359	$	2,257	$	-	$	103,574
Special Mention		-		-		136		-		-		-		-		-		136
Classified		587		-		-		-		-		-		-		-		587
Total	$	51,137	$	18,435	$	15,648	$	9,303	$	4,158	$	3,359	$	2,257	$	-	$	104,297
Multifamily residential real estate
Pass	$	41,106	$	39,272	$	40,252	$	6,075	$	13,163	$	19,141	$	152	$	-	$	159,161
Commercial real estate, owner occupied
Pass	$	74,921	$	7,328	$	27,677	$	10,327	$	5,825	$	1,573	$	2,143	$	-	$	129,794
Special mention		6,344		-		-		-		-		-		-		-		6,344
Classified		3,003		-		-		-		-		-		8		-		3,011
Total	$	84,268	$	7,328	$	27,677	$	10,327	$	5,825	$	1,573	$	2,151	$	-	$	139,149
Commercial real estate, other
Pass	$	103,602	$	36,074	$	32,213	$	16,895	$	6,301	$	1,332	$	1,659	$	-	$	198,076
Classified		686		-		-		-		-		-		-		-		686
Total	$	104,288	$	36,074	$	32,213	$	16,895	$	6,301	$	1,332	$	1,659	$	-	$	198,762
Commercial and industrial
Pass	$	8,115	$	11,410	$	5,118	$	5,467	$	6,913	$	2,811	$	13,226	$	-	$	53,060
Special Mention		-		-		-		-		-		-		96		-		96
Total	$	8,115	$	11,410	$	5,118	$	5,467	$	6,913	$	2,811	$	13,322	$	-	$	53,156
Public sector and IDA
Pass	$	19,730	$	24,934	$	5,826	$	6,491	$	-	$	-	$	-	$	-	$	56,981
Credit cards
Pass	$	-	$	-	$	-	$	-	$	-	$	-	$	4,407	$	-	$	4,407
YTD gross charge-offs	$	-	$	-	$	-	$	-	$	-	$	-	$	11	$	-	$	11
Automobile
Pass	$	202	$	550	$	1,385	$	3,736	$	5,273	$	1,669	$	-	$	-	$	12,815
Special Mention		-		-		-		4		-		-		-		-		4
Classified		-		3		-		6		-		-		-		-		9
Total	$	202	$	553	$	1,385	$	3,746	$	5,273	$	1,669	$	-	$	-	$	12,828
YTD gross charge-offs	$	-	$	-	$	-	$	20	$	-	$	-	$	-	$	-	$	20
Other consumer
Pass	$	509	$	699	$	1,941	$	4,330	$	12,076	$	3,792	$	1,586	$	-	$	24,933
Special Mention		-		1		-		-		8		5		-		-		14
Classified		-		-		2		13		8		-		-		-		23
Total	$	509	$	700	$	1,943	$	4,343	$	12,092	$	3,797	$	1,586	$	-	$	24,970
YTD gross charge-offs	$	-	$	-	$	6	$	-	$	45	$	27	$	-	$	-	$	78
Total Loans
Pass	$	362,549	$	173,768	$	169,600	$	98,164	$	85,786	$	41,545	$	61,097	$	-	$	992,509
Special Mention		6,708		1		136		4		8		5		96		-		6,958
Classified		4,276		3		2		141		8		-		8		-		4,438
Total	$	373,533	$	173,772	$	169,738	$	98,309	$	85,802	$	41,550	$	61,201	$	-	$	1,003,905
YTD gross charge-offs	$	3	$	-	$	6	$	20	$	45	$	27	$	11	$	-	$	112


	Term Loans Amortized Cost Basis by Origination Year														Revolving Loans Converted
December 31, 2024	Prior		2019		2020		2022		2023		2024		Revolving		to Term		Total
Construction, residential
Pass	$	-	$	-	$	-	$	337	$	2,312	$	3,328	$	10,185	$	-	$	16,162
Construction, other
Pass	$	2,938	$	1,138	$	805	$	10,795	$	8,669	$	6,194	$	4,097	$	-	$	34,636
Equity lines
Pass	$	363	$	249	$	387	$	470	$	816	$	402	$	19,894	$	12	$	22,593
Classified		-		-		-		-		-		-		25		-		25
Total	$	363	$	249	$	387	$	470	$	816	$	402	$	19,919	$	12	$	22,618
Residential closed-end first liens
Pass	$	42,211	$	18,111	$	33,630	$	35,557	$	21,593	$	18,991	$	-	$	303	$	170,396
Special mention		367		-		-		-		-		-		-		-		367
Classified		441		-		-		178		-		-		-		-		619
Total	$	43,019	$	18,111	$	33,630	$	35,735	$	21,593	$	18,991	$	-	$	303	$	171,382
Residential closed-end junior liens
Pass	$	1,596	$	-	$	277	$	2,048	$	1,597	$	3,004	$	31	$	21	$	8,574
Investor-owned residential real estate
Pass	$	28,919	$	22,946	$	19,280	$	16,242	$	8,175	$	3,266	$	1,907	$	3,668	$	104,403
Special mention		-		-		-		138		-		-		-		-		138
Classified		740		-		-		-		-		-		-		-		740
Total	$	29,659	$	22,946	$	19,280	$	16,380	$	8,175	$	3,266	$	1,907	$	3,668	$	105,281
Multifamily residential real estate
Pass	$	39,665	$	2,055	$	39,879	$	40,198	$	8,470	$	13,205	$	158	$	-	$	143,630
Commercial real estate, owner occupied
Pass	$	52,916	$	24,539	$	7,432	$	28,753	$	10,351	$	3,810	$	3,422	$	83	$	131,306
Special mention		6,375		-		-		-		-		-		-		-		6,375
Classified		2,222		738		-		-		-		-		12		-		2,972
Total	$	61,513	$	25,277	$	7,432	$	28,753	$	10,351	$	3,810	$	3,434	$	83	$	140,653
Commercial real estate, other
Pass	$	90,358	$	17,919	$	36,777	$	23,775	$	16,990	$	5,583	$	1,703	$	-	$	193,105
Classified		690		-		-		-		-		-		-		-		690
Total	$	91,048	$	17,919	$	36,777	$	23,775	$	16,990	$	5,583	$	1,703	$	-	$	193,795
Commercial and industrial
Pass	$	6,437	$	2,070	$	11,849	$	5,528	$	5,903	$	8,407	$	11,644	$	-	$	51,838
Classified		-		-		-		6		-		-		-		-		6
Total	$	6,437	$	2,070	$	11,849	$	5,534	$	5,903	$	8,407	$	11,644	$	-	$	51,844
YTD gross charge-offs	$	125	$	-	$	-	$	-	$	-	$	22	$	19	$	-	$	166
Public sector and IDA
Pass	$	19,309	$	218	$	25,232	$	5,922	$	6,490	$	-	$	-	$	-	$	57,171
Credit cards
Pass	$	-	$	-	$	-	$	-	$	-	$	-	$	4,698	$	-	$	4,698
YTD gross charge-offs	$	-	$	-	$	-	$	-	$	-	$	-	$	53	$	-	$	53
Automobile
Pass	$	36	$	243	$	727	$	1,640	$	4,474	$	5,832	$	-	$	-	$	12,952
Special mention		-		-		-		-		4		-		-		-		4
Classified		-		-		-		-		28		11		-		-		39
Total	$	36	$	243	$	727	$	1,640	$	4,506	$	5,843	$	-	$	-	$	12,995
YTD gross charge-offs	$	-	$	-	$	6	$	14	$	16	$	11	$	-	$	-	$	47
Other Consumer
Pass	$	184	$	401	$	874	$	2,274	$	4,804	$	15,846	$	760	$	-	$	25,143
Special mention		-		-		1		-		-		9		-		-		10
Classified		-		-		-		2		14		5		-		-		21
Total	$	184	$	401	$	875	$	2,276	$	4,818	$	15,860	$	760	$	-	$	25,174
YTD gross charge-offs	$	-	$	4	$	15	$	19	$	94	$	121	$	-	$	-	$	253
Total Loans
Pass	$	284,932	$	89,889	$	177,149	$	173,539	$	100,644	$	87,868	$	58,499	$	4,087	$	976,607
Special mention		6,742		-		1		138		4		9		-		-		6,894
Classified		4,093		738		-		186		42		16		37		-		5,112
Total	$	295,767	$	47,892	$	87,156	$	188,187	$	152,982	$	90,857	$	41,032	$	113	$	988,613
YTD gross charge-offs	$	125	$	4	$	21	$	33	$	110	$	154	$	72	$	-	$	519

Loan Modifications to Borrowers Experiencing Financial Difficulty

On the date a loan is modified, the Company assesses whether the borrower is experiencing financial difficulty. If the borrower is experiencing financial difficulty, the loan is risk rated special mention or classified, as determined appropriate. If the loan exceeds $400, if it is placed in nonaccrual, or if foreclosure is probable, the loan is individually evaluated for the ACLL.

During the three months ended March 31, 2025, no loans were modified for borrowers experiencing financial difficulty. During the three months ended March 31, 2024, the Company modified two loans to borrowers experiencing financial difficulty.

The following table presents information as of March 31, 2024 about loans modified for borrowers experiencing financial difficulty during the three months ended March 31, 2024.

         March 31, 2024

         Amortized
Cost Basis

         % of
Class

         Type of
Modification

         Financial Effect

         Commercial Real Estate

Commercial real estate owner-occupied

6,396

5.57

Interest only
payments

6 months of interest only payments, re-amortization of the balance to contractual maturity

         Commercial Non real estate

Commercial and industrial

7

0.02

Term extension

Renewal of single-payment note for an additional 3 months

The Company closely monitors the performance of loans that are modified to borrowers experiencing financial difficulty. As of March 31, 2024, the loans were in current status and individually evaluated. There were no modified loans to borrowers experiencing financial difficulty that had a payment default during the three months ended March 31, 2025 and 2024 and that were modified in the twelve months prior. Default occurs when a payment is 90 days past due, the loan is fully or partially charged off or the Company forecloses on the collateral.

Consumer Real Estate Loans In Process of Foreclosure

As of March 31, 2025, the Company had one consumer real estate loan with an amortized cost of $122 in process of foreclosure. As of December 31, 2024, three consumer real estate loans totaling $37 were in process of foreclosure.

ACL for Unfunded Commitments

The following tables present the balance and activity in the ACL for unfunded commitments for the three months ended March 31, 2025 and 2024:


Allowance for Credit Losses on Unfunded Commitments
Balance, December 31, 2024	$	251
Recovery of credit losses		(1	)
Balance, March 31, 2025	$	250

Balance, December 31, 2023	$	259
Recovery of credit losses		(15	)
Balance, March 31, 2024	$	244