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Loans And Leases | 9 Months Ended
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Sep. 30, 2024
Loans And Leases [Abstract] |
Loans And Leases | NOTE 4 – LOANS AND LEASES The following table presents the recorded investment in loans and leases by portfolio segment. The recorded investment in loans and leases includes the principal balance outstanding adjusted for purchase premiums and discounts, and deferred loan fees and costs.
| September 30, 2024 |  | December 31, 2023
| (unaudited) |  |  |
Commercial (1) | $ | 432,916 |  | $ | 439,895
Real estate: |  |  |  |  |
Single-family residential |  | 461,161 |  |  | 478,224
Multi-family residential |  | 176,549 |  |  | 130,778
Commercial |  | 447,790 |  |  | 433,026
Construction |  | 171,495 |  |  | 190,722
Consumer: |  |  |  |  |
Home equity lines of credit |  | 40,930 |  |  | 35,960
Other |  | 3,014 |  |  | 2,393
Subtotal |  | 1,733,855 |  |  | 1,710,998
Less: ACL – Loans |  | (16,780) |  |  | (16,865)
Loans and leases, net | $ | 1,717,075 |  | $ | 1,694,133
(1)Includes $9,076 and $13,497 of commercial leases at September 30, 2024 and December 31, 2023, respectively. Allowance for Credit Losses on Loans (ACL – Loans) The ACL - Loans is a valuation account that is deducted from the amortized cost basis of loans and leases to present the net amount expected to be collected on loans over the contractual term. Loans and leases are collectively referred to as “loans” for the purpose of discussing the allowance for credit losses. The ACL - Loans is adjusted by the provision for credit losses, which is reported in earnings, and reduced by charge offs for loans, net of recoveries. Provision for credit losses on loans reflects the totality of actions taken on all loans for a particular period including any necessary increases or decreases in the allowance related to changes in credit loss expectations associated with specific loans or pools of loans. Loans are charged off against the allowance when the uncollectibility of the loan is confirmed. Expected recoveries do not exceed the aggregate of amounts previously charged off and expected to be charged off. The ACL - Loans represents the Company's best estimate of current expected credit losses (CECL) on loans using relevant available information, from internal and external sources, related to past events, current conditions, and reasonable and supportable forecasts. Historical credit loss experience provides the basis for the estimation of expected credit losses. The CECL calculation is performed and evaluated quarterly and losses are estimated over the expected life of the loan. The level of the ACL - Loans is believed to be adequate to absorb all expected future losses inherent in the loan portfolio at the measurement date. In calculating the ACL - Loans, the loan portfolio was pooled into loan segments with similar risk characteristics. Common characteristics include the type or purpose of the loan, underlying collateral and historical/expected credit loss patterns. In developing the loan segments, the Company analyzed the degree of correlation in how loans within each portfolio respond when subjected to varying economic conditions and scenarios as well as other portfolio stress factors. The expected credit losses are measured over the life of each loan segment utilizing the average charge-off methodology combined with economic forecast models to estimate the current expected credit loss inherent in the loan portfolio. This approach is also leveraged to estimate the expected credit losses associated with non-cancellable unfunded loan commitments incorporating expected utilization rates. The Company sub-segmented certain commercial portfolios by risk level where appropriate. The Company utilized a one-year reasonable and supportable economic forecast period. The Company qualitatively adjusts model results for risk factors that are not inherently considered in the historical losses, but are nonetheless relevant in assessing the expected credit losses within the loan portfolio. These adjustments may increase or decrease the estimate of expected credit losses based upon the assessed level of risk for each qualitative factor. The various risks that may be considered in making qualitative adjustments include, among other things, the impact of (i) changes in economic conditions, (ii) changes in the nature and volume of the loan portfolio, (iii) changes in the existence, growth and effect of any concentrations in credit, (iv) changes in lending policies and procedures, including changes in underwriting standards and practices for collections, write-offs, and recoveries, (v) changes in the quality of the credit review function, (vi) changes in the experience, ability and depth of lending management and staff, (vii) changes in the volume and severity of past due and adversely classified loans and the volume of nonaccrual loans, (viii) changes in the value of underlying collateral for collateral-dependent loans, and (ix) other environmental factors such as regulatory, legal and technological considerations, as well as competition. In some cases, management may determine that an individual loan exhibits unique risk characteristics which differentiate the loan from other loans within the loan segments. In such cases, the loans are evaluated for expected credit losses on an individual basis and excluded from the collective evaluation. Specific reserves in the allowance for credit losses are determined by analyzing the borrower's ability to repay amounts owed, collateral deficiencies, the relative risk grade of the loan and economic conditions affecting the borrower's industry, among other things. A loan is considered to be collateral dependent when, based upon management's assessment, the borrower is experiencing financial difficulty and repayment is expected to be provided substantially through the operation or sale of the collateral. In such cases, expected credit losses are based on the fair value of the collateral at the measurement date, adjusted for estimated selling costs if satisfaction of the loan depends on the sale of the collateral. The fair value of collateral supporting collateral dependent loans is evaluated on a quarterly basis. The following tables present the activity in the ACL - Loans by portfolio segment for the three and nine months ended September 30, 2024 and 2023 (unaudited).
|  | Three Months Ended September 30, 2024 (unaudited)
|  |  |  |  | Real Estate |  |  |  |  |  | Consumer |  |  |
|  | Commercial |  | Single-family |  | Multi-family |  | Commercial |  | Construction |  | Home equity lines of credit |  | Other |  | Total
Allowance for credit losses |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Balances, July 1, 2024 |  | $ | 8,756 |  | $ | 3,306 |  | $ | 1,015 |  | $ | 4,288 |  | $ | 1,236 |  | $ | 383 |  | $ | 301 |  | $ | 19,285
Provision of credit losses |  |  | 574 |  |  | (213) |  |  | 499 |  |  | (166) |  |  | 74 |  |  | 12 |  |  | 6 |  |  | 786
Recoveries on loans |  |  | 30 |  |  | 8 |  |  | - |  |  | - |  |  | - |  |  | 1 |  |  | - |  |  | 39
Loans charged off |  |  | (3,300) |  |  | - |  |  | - |  |  | - |  |  | - |  |  | - |  |  | (30) |  |  | (3,330)
Balances, September 30, 2024 |  | $ | 6,060 |  | $ | 3,101 |  | $ | 1,514 |  | $ | 4,122 |  | $ | 1,310 |  | $ | 396 |  | $ | 277 |  | $ | 16,780
|  | Nine Months Ended September 30, 2024 (unaudited)
|  |  |  |  | Real Estate |  |  |  |  |  | Consumer |  |  |
|  | Commercial |  | Single-family |  | Multi-family |  | Commercial |  | Construction |  | Home equity lines of credit |  | Other |  | Total
Allowance for credit losses |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Balances, January 1, 2024 |  | $ | 5,884 |  | $ | 3,371 |  | $ | 1,231 |  | $ | 4,105 |  | $ | 1,707 |  | $ | 334 |  | $ | 233 |  | $ | 16,865
Provision of credit losses |  |  | 5,307 |  |  | (293) |  |  | 283 |  |  | 17 |  |  | (397) |  |  | 57 |  |  | 324 |  |  | 5,298
Recoveries on loans |  |  | 42 |  |  | 23 |  |  | - |  |  | - |  |  | - |  |  | 5 |  |  | - |  |  | 70
Loans charged off |  |  | (5,173) |  |  | - |  |  | - |  |  | - |  |  | - |  |  | - |  |  | (280) |  |  | (5,453)
Balances, September 30, 2024 |  | $ | 6,060 |  | $ | 3,101 |  | $ | 1,514 |  | $ | 4,122 |  | $ | 1,310 |  | $ | 396 |  | $ | 277 |  | $ | 16,780
‎
|  | Three Months Ended September 30, 2023 (unaudited)
|  |  |  |  | Real Estate |  |  |  |  |  | Consumer |  |  |
|  | Commercial |  | Single-family |  | Multi-family |  | Commercial |  | Construction |  | Home equity lines of credit |  | Other |  | Total
Allowance for credit losses |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Balances, July 1, 2023 |  | $ | 5,339 |  | $ | 3,101 |  | $ | 949 |  | $ | 4,079 |  | $ | 2,101 |  | $ | 323 |  | $ | 68 |  | $ | 15,960
Provision of credit losses |  |  | 1,294 |  |  | 24 |  |  | 136 |  |  | (251) |  |  | (55) |  |  | (10) |  |  | 60 |  |  | 1,198
Recoveries on loans |  |  | - |  |  | 9 |  |  | - |  |  | - |  |  | - |  |  | 2 |  |  | - |  |  | 11
Loans charged off |  |  | (137) |  |  | - |  |  | - |  |  | - |  |  | - |  |  | - |  |  | - |  |  | (137)
Balances, September. 30, 2023 |  | $ | 6,496 |  | $ | 3,134 |  | $ | 1,085 |  | $ | 3,828 |  | $ | 2,046 |  | $ | 315 |  | $ | 128 |  | $ | 17,032
|  | Nine Months Ended September 30, 2023 (unaudited)
|  |  |  |  | Real Estate |  |  |  |  |  | Consumer |  |  |
|  | Commercial |  | Single-family |  | Multi-family |  | Commercial |  | Construction |  | Home equity lines of credit |  | Other |  | Total
Allowance for credit losses |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Balances, December 31, 2022 |  | $ | 4,764 |  | $ | 3,914 |  | $ | 997 |  | $ | 3,384 |  | $ | 2,644 |  | $ | 333 |  | $ | 26 |  | $ | 16,062
Impact of adoption of ASC 326 |  |  | 877 |  |  | (958) |  |  | 66 |  |  | 726 |  |  | (1,019) |  |  | (129) |  |  | 28 |  |  | (409)
Balances, January 1, 2023 Post-ASC 326 adoption |  |  | 5,641 |  |  | 2,956 |  |  | 1,063 |  |  | 4,110 |  |  | 1,625 |  |  | 204 |  |  | 54 |  |  | 15,653
Provision of credit losses |  |  | 912 |  |  | 147 |  |  | 22 |  |  | (282) |  |  | 421 |  |  | 108 |  |  | 74 |  |  | 1,402
Recoveries on loans |  |  | 85 |  |  | 31 |  |  | - |  |  | - |  |  | - |  |  | 3 |  |  | 3 |  |  | 122
Loans charged off |  |  | (142) |  |  | - |  |  | - |  |  | - |  |  | - |  |  | - |  |  | (3) |  |  | (145)
Balances, September 30, 2023 |  | $ | 6,496 |  | $ | 3,134 |  | $ | 1,085 |  | $ | 3,828 |  | $ | 2,046 |  | $ | 315 |  | $ | 128 |  | $ | 17,032
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. The fair value of 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 the borrower’s financial information are discounted as considered appropriate based on age and quality of the information and current market conditions. The tables below present the amortized cost basis of collateral dependent loans by loan class and their respective collateral types, which are individually evaluated to determine expected credit losses.
| September 30, 2024 (unaudited)
| Residential Real Estate |  | Other |  | Total |  | Allowance on Collateral Dependent Loans
Commercial | $ | - |  | $ | 8,486 |  | $ | 8,486 |  | $ | 360
Real estate: |  |  |  |  |  |  |  |  |  |  |
Single-family residential |  | 87 |  |  | - |  |  | 87 |  |  | -
Total | $ | 87 |  | $ | 8,486 |  | $ | 8,573 |  | $ | 360
‎
| December 31, 2023
| Residential Real Estate |  | Other |  | Total |  | Allowance on Collateral Dependent Loans
Commercial | $ | - |  | $ | 449 |  | $ | 449 |  | $ | 44
Real estate: |  |  |  |  |  |  |  |  |  |  |
Single-family residential |  | 90 |  |  | - |  |  | 90 |  |  | -
Total | $ | 90 |  | $ | 449 |  | $ | 539 |  | $ | 44
The following table presents the recorded investment in nonaccrual loans by class of loans at September 30, 2024 (unaudited):
| Nonaccrual Loans |  | Nonaccrual Loans with no Allowance for Credit Losses
Commercial | $ | 13,053 |  | $ | 7,233
Real estate: |  |  |  |  |
Single-family residential |  | 1,531 |  |  | 1,531
Consumer: |  |  |  |  |
Home equity lines of credit: |  | 13 |  |  | 13
Total nonaccrual loans | $ | 14,597 |  | $ | 8,777
The following table presents the recorded investment in nonaccrual loans by class of loans at December 31, 2023.
| Nonaccrual Loans |  | Nonaccrual Loans with no Allowance for Credit Losses
Commercial | $ | 5,048 |  | $ | 1,658
Real estate: |  |  |  |  |
Single-family residential |  | 627 |  |  | 627
Consumer: |  |  |  |  |
Home equity lines of credit: |  | 17 |  |  | 17
Other consumer |  | 30 |  |  | 30
Total nonaccrual loans | $ | 5,722 |  | $ | 2,332
Nonaccrual loans include both smaller balance single-family mortgage loans, consumer loans and commercial loans and leases that are collectively evaluated for impairment and individually classified impaired loans. There were no loans 90 days or more past due and still accruing interest at September 30, 2024 or December 31, 2023. The following table presents the aging of the recorded investment in past due loans and leases by class of loans as of September 30, 2024 (unaudited):
| 30 - 59 Days Past Due |  | 60 - 89 Days Past Due |  | 90 Days or more Past Due |  | Total Past Due |  | Loans Not Past Due |  | Nonaccrual Loans Not 90 days or more Past Due
Commercial | $ | 50 |  | $ | 89 |  | $ | 5,629 |  | $ | 5,768 |  | $ | 427,148 |  | $ | 7,424
Real estate: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Single-family residential |  | - |  |  | 332 |  |  | 1,481 |  |  | 1,813 |  |  | 459,348 |  |  | 50
Multi-family residential |  | - |  |  | - |  |  | - |  |  | - |  |  | 176,549 |  |  | -
Commercial: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Non-owner occupied |  | - |  |  | - |  |  | - |  |  | - |  |  | 231,187 |  |  | -
Owner occupied |  | - |  |  | - |  |  | - |  |  | - |  |  | 193,106 |  |  | -
Land |  | - |  |  | - |  |  | - |  |  | - |  |  | 23,497 |  |  | -
Construction |  | - |  |  | - |  |  | - |  |  | - |  |  | 171,495 |  |  | -
Consumer: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Home equity lines of credit: |  | 96 |  |  | - |  |  | - |  |  | 96 |  |  | 40,834 |  |  | 13
Other |  | - |  |  | - |  |  | - |  |  | - |  |  | 3,014 |  |  | -
Total | $ | 146 |  | $ | 421 |  | $ | 7,110 |  | $ | 7,677 |  | $ | 1,726,178 |  | $ | 7,487
The following table presents the aging of the recorded investment in past due loans and leases by class of loans as of December 31, 2023:
| 30 - 59 Days Past Due |  | 60 - 89 Days Past Due |  | 90 Days or more Past Due |  | Total Past Due |  | Loans Not Past Due |  | Nonaccrual Loans Not 90 days or more Past Due
Commercial | $ | 98 |  | $ | - |  | $ | 622 |  | $ | 720 |  | $ | 439,175 |  | $ | 4,426
Real estate: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Single-family residential |  | 165 |  |  | 372 |  |  | 563 |  |  | 1,100 |  |  | 477,124 |  |  | 64
Multi-family residential |  | - |  |  | - |  |  | - |  |  | - |  |  | 130,778 |  |  | -
Commercial: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Non-owner occupied |  | - |  |  | - |  |  | - |  |  | - |  |  | 228,548 |  |  | -
Owner occupied |  | - |  |  | - |  |  | - |  |  | - |  |  | 183,773 |  |  | -
Land |  | - |  |  | - |  |  | - |  |  | - |  |  | 20,705 |  |  | -
Construction |  | - |  |  | - |  |  | - |  |  | - |  |  | 190,722 |  |  | -
Consumer: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Home equity lines of credit: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Originated for portfolio |  | 97 |  |  | - |  |  | 17 |  |  | 114 |  |  | 35,846 |  |  | -
Purchased for portfolio |  | - |  |  | - |  |  | - |  |  | - |  |  | - |  |  | -
Other |  | - |  |  | - |  |  | 30 |  |  | 30 |  |  | 2,363 |  |  | -
Total | $ | 360 |  | $ | 372 |  | $ | 1,232 |  | $ | 1,964 |  | $ | 1,709,034 |  | $ | 4,490
‎ Loan Modifications: During the three months ended September 30, 2024, the Company did no t modify any loans to borrowers experiencing financial difficulties. During the nine months ended September 30, 2024, the Company modified one commercial loan, with an amortized cost basis of $4.3 million at September 30, 2024, where the borrower was experiencing financial difficulty. The amortized cost basis of this loan represented 1.0% of commercial loans at September 30, 2024. The loan was modified to increase the interest rate by 75 bps, extend the maturity date by 6 months, and allow for an amortization holiday and deferred interest option. The loan was not past due during the nine months ended September 30, 2024. During the three and nine months ended September 30, 2023, the Company modified one commercial loan, totaling $2.9 million, where the borrower was experiencing financial difficulty. The amortized cost basis of this loan represented 0.7% of commercial loans at September 30, 2023. The loan was modified to defer principal and interest payments for up to one year. For any period where the payments are deferred, the note will accrue at a higher rate of interest. This loan was deemed uncollectible during the quarter ended September 30, 2024 and was charged-off. Upon the Company’s determination that a modified loan (or portion of a loan) has subsequently been deemed uncollectible, the loan (or portion of the loan), is charged-off. Therefore, the amortized cost basis of the loan is reduced by the uncollectible amount and the allowance for credit losses is adjusted by the same amount. Credit Quality Indicators: The Company categorizes loans into risk categories based on relevant information about the ability of borrowers to service their debt, such as current financial information, historical payment experience, credit documentation, public information and current economic trends, among other factors. Management analyzes loans individually by classifying the loans as to credit risk. This analysis includes commercial, commercial real estate and multi-family residential real estate loans. Internal loan reviews for these loan types are performed at least annually, and more often for loans with higher credit risk. Adjustments to loan risk ratings are made based on the reviews and at any time information is received that may affect risk ratings. The following definitions are used for risk ratings: Special Mention. Loans classified as special mention have a potential weakness that deserves management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or of CFBank’s credit position at some future date. Substandard. Loans classified as substandard are inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged, if any. Loans so classified have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that there will be some loss if the deficiencies are not corrected. Doubtful. Loans classified as doubtful have all the weaknesses inherent in those classified as substandard, with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions and values, highly questionable and improbable. Loans not meeting the criteria to be classified into one of the above categories are considered to be “not rated” or “pass-rated” loans. Loans listed as not rated are primarily groups of homogeneous loans. Past due information is the primary credit indicator for groups of homogenous loans. Loans listed as pass-rated loans are loans that are subject to internal loan reviews and are determined not to meet the criteria required to be classified as special mention, substandard or doubtful. ‎ The following table summarizes the risk grading of the Company’s loan portfolio by loan class and by year of origination for the years indicated as of September 30, 2024. Consumer and Single-family residential loans are not risk graded. For purposes of this disclosure, those loans are classified in the following manner: loans that are 89 days or less past due and accruing are “performing” loans and loans greater than 89 days past due or in nonaccrual are “nonperforming” loans.
| Term Loans (amortized cost basis by origination year) |  |  |  |  |  |  |  |  |
(unaudited) | 2024 |  | 2023 |  | 2022 |  | 2021 |  | 2020 |  | Prior |  | Revolving loans amortized cost basis |  | Revolving loans converted to term |  | Total
Commercial |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass | $ | 21,815 |  | $ | 30,831 |  | $ | 71,917 |  | $ | 84,907 |  | $ | 43,990 |  | $ | 11,715 |  | $ | 148,677 |  | $ | 3,038 |  | $ | 416,890
Special Mention |  | - |  |  | - |  |  | 310 |  |  | - |  |  | - |  |  | 78 |  |  | 3,686 |  |  | - |  |  | 4,074
Substandard |  | - |  |  | - |  |  | 7,527 |  |  | 4,375 |  |  | - |  |  | - |  |  | 50 |  |  | - |  |  | 11,952
Total Commercial |  | 21,815 |  |  | 30,831 |  |  | 79,754 |  |  | 89,282 |  |  | 43,990 |  |  | 11,793 |  |  | 152,413 |  |  | 3,038 |  |  | 432,916
Gross charge-offs during the nine months ended September 30, 2024 |  | - |  |  | - |  |  | 1,755 |  |  | 3,418 |  |  | - |  |  | - |  |  | - |  |  | - |  |  | 5,173
Real estate loans: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Single-family residential |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Payment performance |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Performing |  | 16,550 |  |  | 35,274 |  |  | 124,035 |  |  | 218,050 |  |  | 43,670 |  |  | 22,051 |  |  | - |  |  | - |  |  | 459,630
Nonperforming |  | - |  |  | 547 |  |  | 370 |  |  | - |  |  | - |  |  | 614 |  |  | - |  |  | - |  |  | 1,531
Total Single-family residential loans |  | 16,550 |  |  | 35,821 |  |  | 124,405 |  |  | 218,050 |  |  | 43,670 |  |  | 22,665 |  |  | - |  |  | - |  |  | 461,161
Multi-family residential |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  | 30,593 |  |  | 24,812 |  |  | 8,694 |  |  | 70,038 |  |  | 7,196 |  |  | 35,216 |  |  | - |  |  | - |  |  | 176,549
Total Multi-family residential loans |  | 30,593 |  |  | 24,812 |  |  | 8,694 |  |  | 70,038 |  |  | 7,196 |  |  | 35,216 |  |  | - |  |  | - |  |  | 176,549
Commercial: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Non-owner occupied |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  | 6,648 |  |  | 51,872 |  |  | 33,477 |  |  | 67,740 |  |  | 14,253 |  |  | 56,692 |  |  | - |  |  | - |  |  | 230,682
Substandard |  | - |  |  | - |  |  | - |  |  | - |  |  | - |  |  | 505 |  |  | - |  |  | - |  |  | 505
Total Non-owner occupied loans |  | 6,648 |  |  | 51,872 |  |  | 33,477 |  |  | 67,740 |  |  | 14,253 |  |  | 57,197 |  |  | - |  |  | - |  |  | 231,187
Owner occupied |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  | 13,486 |  |  | 23,352 |  |  | 55,174 |  |  | 48,680 |  |  | 18,117 |  |  | 33,022 |  |  | - |  |  | - |  |  | 191,831
Special Mention |  | - |  |  | - |  |  | - |  |  | - |  |  | 596 |  |  | - |  |  | - |  |  | - |  |  | 596
Substandard |  | - |  |  | - |  |  | - |  |  | - |  |  | - |  |  | 679 |  |  |  |  |  |  |  |  | 679
Total Owner occupied loans |  | 13,486 |  |  | 23,352 |  |  | 55,174 |  |  | 48,680 |  |  | 18,713 |  |  | 33,701 |  |  | - |  |  | - |  |  | 193,106
Land |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  | 13,174 |  |  | 4,708 |  |  | - |  |  | 5,255 |  |  | - |  |  | 360 |  |  | - |  |  | - |  |  | 23,497
Total Land loans |  | 13,174 |  |  | 4,708 |  |  | - |  |  | 5,255 |  |  | - |  |  | 360 |  |  | - |  |  | - |  |  | 23,497
Construction |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Not Rated |  | 219 |  |  | - |  |  | - |  |  | 1,481 |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 1,700
Pass |  | 17,574 |  |  | 55,972 |  |  | 65,498 |  |  | 27,122 |  |  | 3,629 |  |  | - |  |  | - |  |  | - |  |  | 169,795
Total Construction loans |  | 17,793 |  |  | 55,972 |  |  | 65,498 |  |  | 28,603 |  |  | 3,629 |  |  | - |  |  | - |  |  | - |  |  | 171,495
Total Real Estate loans |  | 98,244 |  |  | 196,537 |  |  | 287,248 |  |  | 438,366 |  |  | 87,461 |  |  | 149,139 |  |  | - |  |  | - |  |  | 1,256,995
Consumer: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Home equity lines of credit: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Payment performance |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Performing |  | - |  |  | - |  |  | - |  |  | - |  |  | - |  |  | - |  |  | 37,656 |  |  | 3,261 |  |  | 40,917
Nonperforming |  | - |  |  | - |  |  | - |  |  | - |  |  | - |  |  | - |  |  | - |  |  | 13 |  |  | 13
Total Home equity lines of credit |  | - |  |  | - |  |  | - |  |  | - |  |  | - |  |  | - |  |  | 37,656 |  |  | 3,274 |  |  | 40,930
Other |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Payment performance |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | -
Performing |  | - |  |  | - |  |  | - |  |  | - |  |  | 7 |  |  | 181 |  |  | 2,826 |  |  | - |  |  | 3,014
Total Other consumer loans |  | - |  |  | - |  |  | - |  |  | - |  |  | 7 |  |  | 181 |  |  | 2,826 |  |  | - |  |  | 3,014
Gross charge-offs during the nine months ended September 30, 2024 |  | - |  |  | - |  |  | - |  |  | - |  |  | - |  |  | - |  |  | 280 |  |  | - |  |  | 280
Total loans | $ | 120,059 |  | $ | 227,368 |  | $ | 367,002 |  | $ | 527,648 |  | $ | 131,458 |  | $ | 161,113 |  | $ | 192,895 |  | $ | 6,312 |  | $ | 1,733,855
Total gross charge-offs during the nine months ended September 30, 2024 | $ | - |  | $ | - |  | $ | 1,755 |  | $ | 3,418 |  | $ | - |  | $ | - |  | $ | 280 |  | $ | - |  | $ | 5,453
‎ The following table summarizes the risk grading of the Company’s loan portfolio by loan class and by year of origination for the years indicated as of December 31, 2023. Consumer and Single-family residential loans are not risk graded. For purposes of this disclosure, those loans are classified in the following manner: loans that are 89 days or less past due and accruing are “performing” loans and loans greater than 89 days past due or in nonaccrual are “nonperforming” loans.
| Term Loans (amortized cost basis by origination year) |  |  |  |  |  |  |  |  |
| 2023 |  | 2022 |  | 2021 |  | 2020 |  | 2019 |  | Prior |  | Revolving loans amortized cost basis |  | Revolving loans converted to term |  | Total
Commercial |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass | $ | 32,965 |  | $ | 86,433 |  | $ | 90,297 |  | $ | 45,670 |  | $ | 3,189 |  | $ | 9,888 |  | $ | 159,065 |  | $ | 1,078 |  | $ | 428,585
Special Mention |  | - |  |  | - |  |  | 2,807 |  |  | - |  |  | 84 |  |  | - |  |  | - |  |  | - |  |  | 2,891
Substandard |  | - |  |  | 384 |  |  | 7,537 |  |  | - |  |  | - |  |  | - |  |  | 50 |  |  | - |  |  | 7,971
Doubtful |  | - |  |  | 448 |  |  | - |  |  | - |  |  | - |  |  | - |  |  | - |  |  | - |  |  | 448
Total Commercial |  | 32,965 |  |  | 87,265 |  |  | 100,641 |  |  | 45,670 |  |  | 3,273 |  |  | 9,888 |  |  | 159,115 |  |  | 1,078 |  |  | 439,895
Gross charge-offs for the year ended December 31, 2024 |  | - |  |  | 564 |  |  | 211 |  |  | - |  |  | - |  |  | - |  |  | - |  |  | - |  |  | 775
Real estate loans: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Single-family residential |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Payment performance |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Performing |  | 42,655 |  |  | 131,416 |  |  | 231,379 |  |  | 45,785 |  |  | 9,584 |  |  | 16,778 |  |  | - |  |  | - |  |  | 477,597
Nonperforming |  | - |  |  | - |  |  | - |  |  | - |  |  | - |  |  | 627 |  |  | - |  |  | - |  |  | 627
Total Single-family residential loans |  | 42,655 |  |  | 131,416 |  |  | 231,379 |  |  | 45,785 |  |  | 9,584 |  |  | 17,405 |  |  | - |  |  | - |  |  | 478,224
Multi-family residential |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  | 24,839 |  |  | 8,776 |  |  | 53,815 |  |  | 7,311 |  |  | 15,772 |  |  | 20,265 |  |  | - |  |  | - |  |  | 130,778
Total Multi-family residential loans |  | 24,839 |  |  | 8,776 |  |  | 53,815 |  |  | 7,311 |  |  | 15,772 |  |  | 20,265 |  |  | - |  |  | - |  |  | 130,778
Commercial: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Non-owner occupied |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  | 57,092 |  |  | 27,068 |  |  | 61,990 |  |  | 15,085 |  |  | 20,101 |  |  | 45,725 |  |  | 982 |  |  | - |  |  | 228,043
Special Mention |  | - |  |  | - |  |  | - |  |  | - |  |  | 505 |  |  | - |  |  | - |  |  | - |  |  | 505
Total Non-owner occupied loans |  | 57,092 |  |  | 27,068 |  |  | 61,990 |  |  | 15,085 |  |  | 20,606 |  |  | 45,725 |  |  | 982 |  |  | - |  |  | 228,548
Owner occupied |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  | 20,353 |  |  | 55,169 |  |  | 50,210 |  |  | 19,775 |  |  | 18,751 |  |  | 18,768 |  |  | 68 |  |  | - |  |  | 183,094
Special Mention |  | - |  |  | - |  |  | - |  |  | - |  |  | 679 |  |  | - |  |  | - |  |  | - |  |  | 679
Total Owner occupied loans |  | 20,353 |  |  | 55,169 |  |  | 50,210 |  |  | 19,775 |  |  | 19,430 |  |  | 18,768 |  |  | 68 |  |  | - |  |  | 183,773
Land |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  | 7,932 |  |  | 6,037 |  |  | 6,177 |  |  | - |  |  | 149 |  |  | 410 |  |  | - |  |  | - |  |  | 20,705
Total Land loans |  | 7,932 |  |  | 6,037 |  |  | 6,177 |  |  | - |  |  | 149 |  |  | 410 |  |  | - |  |  | - |  |  | 20,705
Construction |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Pass |  | 31,739 |  |  | 78,602 |  |  | 61,435 |  |  | 4,174 |  |  | - |  |  | - |  |  | 14,772 |  |  | - |  |  | 190,722
Total Construction loans |  | 31,739 |  |  | 78,602 |  |  | 61,435 |  |  | 4,174 |  |  | - |  |  | - |  |  | 14,772 |  |  | - |  |  | 190,722
Total Real Estate loans |  | 184,610 |  |  | 307,068 |  |  | 465,006 |  |  | 92,130 |  |  | 65,541 |  |  | 102,573 |  |  | 15,822 |  |  | - |  |  | 1,232,750
Consumer: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Home equity lines of credit: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Payment performance |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Performing |  | - |  |  | - |  |  | - |  |  | - |  |  | - |  |  | - |  |  | 33,510 |  |  | 2,433 |  |  | 35,943
Nonperforming |  | - |  |  | - |  |  | - |  |  | - |  |  | - |  |  | - |  |  | - |  |  | 17 |  |  | 17
Total Home equity lines of credit |  | - |  |  | - |  |  | - |  |  | - |  |  | - |  |  | - |  |  | 33,510 |  |  | 2,450 |  |  | 35,960
Other |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Payment performance |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Performing |  | - |  |  | - |  |  | - |  |  | 12 |  |  | - |  |  | 216 |  |  | 2,135 |  |  | - |  |  | 2,363
Nonperforming |  | - |  |  | - |  |  | - |  |  | - |  |  | - |  |  | - |  |  | - |  |  | 30 |  |  | 30
Total Other consumer loans |  | - |  |  | - |  |  | - |  |  | 12 |  |  | - |  |  | 216 |  |  | 2,135 |  |  | 30 |  |  | 2,393
Gross charge-offs for the year ended December 31, 2024 |  | - |  |  | - |  |  | - |  |  | - |  |  | - |  |  | 3 |  |  | - |  |  | - |  |  | 3
Total loans | $ | 217,575 |  | $ | 394,333 |  | $ | 565,647 |  | $ | 137,812 |  | $ | 68,814 |  | $ | 112,677 |  | $ | 210,582 |  | $ | 3,558 |  | $ | 1,710,998
Total gross charge-offs during the year ended December 31, 2023 | $ | - |  | $ | 564 |  | $ | 211 |  | $ | - |  | $ | - |  | $ | 3 |  | $ | - |  | $ | - |  | $ | 778
Direct Financing Leases: The following lists the components of the net investment in direct financing leases:
| September 30, 2024 |  | December 31, 2023
| (unaudited) |  |  |
Total minimum lease payments to be received | $ | 9,510 |  | $ | 14,343
Less: Unearned income |  | (443) |  |  | (863)
Plus: Indirect initial costs |  | 9 |  |  | 17
Net investment in direct financing leases | $ | 9,076 |  | $ | 13,497
The following summarizes the future minimum lease payments receivable in fiscal year 2024 and in subsequent fiscal years:
2024, excluding the nine months ended September 30, 2024 |  | $ | 1,465
2025 |  |  | 4,836
2026 |  |  | 2,620
2027 |  |  | 539
2028 |  |  | 50
Thereafter |  |  | -
Total future minimum payments |  | $ | 9,510

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