Loan and Allowance for Loan Losses	12 Months Ended
Loan and Allowance for Loan Losses	Dec. 31, 2023
Loans And Leases Receivable Disclosure [Abstract]
Loans and leases receivable disclosure [Text Block]	NOTE 5: LOANS AND ALLOWANCE FOR CREDIT LOSSES December 31 (In thousands) 2023 2022 Commercial and industrial $ 73,374 $ 66,212 Construction and land development 68,329 66,479 Commercial real estate: Owner occupied 66,783 61,125 Hotel/motel 39,131 33,378 Multifamily 45,841 41,084 Other 135,552 128,986 Total commercial real estate 287,307 264,573 Residential real estate: Consumer mortgage 60,545 45,370 Investment property 56,912 52,278 Total residential real estate 117,457 97,648 Consumer installment 10,827 9,546 Total loans, net of unearned income 557,294 504,458 Loans secured by real estate were approximately 84.9 % of the total loan portfolio at December 31, 2023. At December 31, 2023, the Company’s geographic loan distribution was concentrated primarily in Lee County, Alabama and surrounding areas. The loan portfolio segment is defined as the level at which an entity develops and documents a systematic method for determining its allowance for credit losses. As part of the Company’s quarterly assessment of the allowance, the loan portfolio is disaggregated into the following portfolio segments: commercial and industrial, construction and land development, commercial real estate, residential real estate and consumer installment. Where appropriate, the Company’s loan portfolio segments are further disaggregated into classes. A class is generally determined based on the initial measurement attribute, risk characteristics of the loan, and an entity’s method for monitoring and determining credit risk. The following describe the risk characteristics relevant to each of the portfolio segments and classes. Commercial and industrial (“C&I”) — includes loans to finance business operations, equipment purchases, or other needs for small and medium-sized commercial customers. Also included in this category are loans to finance agricultural production. Generally, the primary source of repayment is the cash flow from business operations and activities of the borrower. Construction and land development (“C&D”) — includes both loans and credit lines for the purpose of purchasing, carrying and developing land into commercial developments or residential subdivisions. Also included are loans and lines for construction of residential, multi-family and commercial buildings. Generally the primary source of repayment is dependent upon the sale or refinance of the real estate collateral. Commercial real estate (“CRE”) — includes loans disaggregated in these classes: Owner occupied – includes loans secured by business facilities to finance business operations, equipment and owner-occupied facilities primarily for small and medium-sized commercial customers. Generally the primary source of loan repayment are the cash flows from the business operations and activities of the borrower, who owns the property. Hotel/motel – includes loans for hotels and motels. Generally, the primary source of repayment is dependent upon income generated from the real estate collateral. The underwriting of these loans takes into consideration the occupancy and rental rates, as well as the financial health of the borrower. Multifamily – primarily includes loans to finance income-producing multi-family properties. Loans in this class include loans for 5 or more unit residential property and apartments leased to residents. Generally, the primary source of repayment is dependent upon income generated from the real estate collateral. The underwriting of these loans takes into consideration the occupancy and rental rates, as well as the financial health of the borrower. Other – primarily includes loans to finance income-producing commercial properties. Loans in this class include loans for neighborhood retail centers, medical and professional offices, single retail stores, industrial buildings, and warehouses leased generally to local businesses and residents. Generally, the primary source of repayment is dependent upon income generated from the real estate collateral. The underwriting of these loans takes into consideration the occupancy and rental rates as well as the financial health of the borrower. Residential real estate (“RRE”) — includes loans disaggregated into two classes: Consumer mortgage – primarily includes first or second lien mortgages and home equity lines to consumers that are secured by a primary residence or second home. These loans are underwritten in accordance with the Bank’s general loan policies and procedures which require, among other things, proper documentation of each borrower’s financial condition, satisfactory credit history and property value. Investment property – primarily includes loans to finance income-producing 1-4 family residential properties. Generally, the primary source of repayment is dependent upon income generated from leasing the property securing the loan. The underwriting of these loans takes into consideration the rental rates as well as the financial health of the borrower. Consumer installment — includes loans to individuals both secured by personal property and unsecured. Loans include personal lines of credit, automobile loans, and other retail loans. These loans are underwritten in accordance with the Bank’s general loan policies and procedures which require, among other things, proper documentation of each borrower’s financial condition, satisfactory credit history, and if applicable, property value. The following is a summary of current, accruing past due and nonaccrual loans by portfolio class as of December 31, 2023 and 2022. Accruing Accruing Total 30-89 Days Greater than Accruing Non- Total (In thousands) Current Past Due 90 days Loans Accrual Loans December 31, 2023: Commercial and industrial $ 73,108 266 — 73,374 — $ 73,374 Construction and land development 68,329 — — 68,329 — 68,329 Commercial real estate: Owner occupied 66,000 — — 66,000 783 66,783 Hotel/motel 39,131 — — 39,131 — 39,131 Multifamily 45,841 — — 45,841 — 45,841 Other 135,552 — — 135,552 — 135,552 Total commercial real estate 286,524 — — 286,524 783 287,307 Residential real estate: Consumer mortgage 60,442 — — 60,442 103 60,545 Investment property 56,597 290 — 56,887 25 56,912 Total residential real estate 117,039 290 — 117,329 128 117,457 Consumer installment 10,781 46 — 10,827 — 10,827 Total $ 555,781 602 — 556,383 911 $ 557,294 December 31, 2022: Commercial and industrial $ 65,764 5 — 65,769 443 $ 66,212 Construction and land development 66,479 — — 66,479 — 66,479 Commercial real estate: Owner occupied 61,125 — — 61,125 — 61,125 Hotel/motel 33,378 — — 33,378 — 33,378 Multifamily 41,084 — — 41,084 — 41,084 Other 126,870 — — 126,870 2,116 128,986 Total commercial real estate 262,457 — — 262,457 2,116 264,573 Residential real estate: Consumer mortgage 45,160 38 — 45,198 172 45,370 Investment property 52,278 — — 52,278 — 52,278 Total residential real estate 97,438 38 — 97,476 172 97,648 Consumer installment 9,506 40 — 9,546 — 9,546 Total $ 501,644 83 — 501,727 2,731 $ 504,458 Credit Quality Indicators The credit quality of the loan portfolio is summarized no less frequently than quarterly using categories similar to the standard asset classification system used by the federal banking agencies. The following table presents credit quality indicators for the loan portfolio segments and classes by year of origination as of December 31, 2023. These categories are utilized to develop the associated allowance for credit losses using historical losses adjusted for qualitative and environmental factors and are defined as follows: ● Pass – loans which are well protected by the current net worth and paying capacity of the obligor (or guarantors, if any) or by the fair value, less cost to acquire and sell, of any underlying collateral. ● Special Mention – loans with potential weakness that may, if not reversed or corrected, weaken the credit or inadequately protect the Company’s position at some future date. These loans are not adversely classified and do not expose an institution to sufficient risk to warrant an adverse classification. ● Substandard Accruing – loans that exhibit a well-defined weakness which presently jeopardizes debt repayment, even though they are currently performing. These loans are characterized by the distinct possibility that the Company may incur a loss in the future if these weaknesses are not corrected. ● Nonaccrual – includes loans where management has determined that full payment of principal and interest is not expected. (Dollars in thousands) 2023 2022 2021 2020 2019 Prior to 2019 Revolving Loans Total Loans December 31, 2023: Commercial and industrial Pass $ 1,187 334 2,220 22,152 2,363 44,780 77 $ 73,113 Special mention — — — — — — — — Substandard — — — — 206 55 — 261 Nonaccrual — — — — — — — — Total commercial and industrial 1,187 334 2,220 22,152 2,569 44,835 77 73,374 Current period gross charge-offs — — 13 — 151 — — 164 Construction and land development Pass 6,771 13,326 11,461 11,070 4,329 20,758 614 $ 68,329 Special mention — — — — — — — — Substandard — — — — — — — — Nonaccrual — — — — — — — — Total construction and land development 6,771 13,326 11,461 11,070 4,329 20,758 614 68,329 Current period gross charge-offs — — — — — — — — Commercial real estate: Owner occupied Pass 39 4,705 9,514 14,684 3,405 33,343 — $ 65,690 Special mention — — — — — 260 — 260 Substandard — — — — — 50 — 50 Nonaccrual — — — — — 783 — 783 Total owner occupied 39 4,705 9,514 14,684 3,405 34,436 — 66,783 Current period gross charge-offs — — — — — — — — Hotel/motel Pass — 1,423 7,364 8,428 3,938 17,978 — $ 39,131 Special mention — — — — — — — — Substandard — — — — — — — — Nonaccrual — — — — — — — — Total hotel/motel — 1,423 7,364 8,428 3,938 17,978 — 39,131 Current period gross charge-offs — — — — — — — — (Dollars in thousands) 2023 2022 2021 2020 2019 Prior to 2019 Revolving Loans Total Loans December 31, 2023: Multi-family Pass — 81 8,292 6,765 151 30,552 — 45,841 Special mention — — — — — — — — Substandard — — — — — — — — Nonaccrual — — — — — — — — Total multi-family — 81 8,292 6,765 151 30,552 — 45,841 Current period gross charge-offs — — — — — — — — Other Pass 3,225 5,234 20,796 27,979 5,771 72,393 — 135,398 Special mention — — — — — — — — Substandard 154 — — — — — — 154 Nonaccrual — — — — — — — — Total other 3,379 5,234 20,796 27,979 5,771 72,393 — 135,552 Current period gross charge-offs — — — — — — — — Residential real estate: Consumer mortgage Pass 5,624 7,483 13,500 4,332 2,427 22,164 3,890 59,420 Special mention 249 — — 56 — 190 — 495 Substandard 160 84 58 — 209 16 — 527 Nonaccrual — — 45 — — 58 — 103 Total consumer mortgage 6,033 7,567 13,603 4,388 2,636 22,428 3,890 60,545 Current period gross charge-offs — — — — — — — — Investment property Pass 9,358 11,630 10,299 5,252 910 16,352 2,521 56,322 Special mention — — — — — 41 — 41 Substandard — 233 43 — — — 248 524 Nonaccrual — — — — — 25 — 25 Total investment property 9,358 11,863 10,342 5,252 910 16,418 2,769 56,912 Current period gross charge-offs — — — — — — — — Consumer installment Pass 58 29 728 2,466 1,227 6,210 — 10,718 Special mention — — — 27 — 18 — 45 Substandard — — 12 25 — 27 — 64 Nonaccrual — — — — — — — — Total consumer installment 58 29 740 2,518 1,227 6,255 — 10,827 Current period gross charge-offs 34 57 13 1 — — — 105 Total loans Pass 26,262 44,245 84,174 103,128 24,521 264,530 7,102 553,962 Special mention 249 — — 83 — 509 — 841 Substandard 314 317 113 25 415 148 248 1,580 Nonaccrual — — 45 — — 866 — 911 Total loans $ 26,825 44,562 84,332 103,236 24,936 266,053 7,350 $ 557,294 Total current period gross charge-offs $ 34 57 26 1 151 — — 269 (In thousands) Pass Special Mention Substandard Accruing Nonaccrual Total loans December 31, 2022 Commercial and industrial $ 65,550 7 212 443 $ 66,212 Construction and land development 66,479 — — — 66,479 Commercial real estate: Owner occupied 60,726 238 161 — 61,125 Hotel/motel 33,378 — — — 33,378 Multifamily 41,084 — — — 41,084 Other 126,700 170 — 2,116 128,986 Total commercial real estate 261,888 408 161 2,116 264,573 Residential real estate: Consumer mortgage 44,172 439 587 172 45,370 Investment property 51,987 43 248 — 52,278 Total residential real estate 96,159 482 835 172 97,648 Consumer installment 9,498 1 47 — 9,546 Total $ 499,574 898 1,255 2,731 $ 504,458 The following table is a summary of the Company’s nonaccrual loans by major categories as of December 31, 2023 and 2022. CECL Incurred Loss December 31, 2023 December 31, 2022 Nonaccrual Nonaccrual Total Loans with Loans with an Nonaccrual Nonaccrual (Dollars in thousands) No Allowance Allowance Loans Loans Commercial and industrial $ — — — $ 443 Commercial real estate 783 — 783 2,116 Residential real estate — 128 128 172 Total $ 783 128 911 $ 2,731 The Company did not recognize any interest income on nonaccrual loans during 2023. The Company designates individually evaluated loans on nonaccrual status as collateral -dependent loans, as well as other loans that management of the Company designates as having higher risk. Collateral-dependent loans are loans for which the repayment is expected to be provided substantially through the operation or sale of the collateral and the borrower is experiencing financial difficulty. These loans do not share common risk characteristics and are not included within the collectively evaluated loans for determining the allowance for credit losses. Under CECL, for collateral-dependent loans, the Company has adopted the practical expedient to measure the allowance for credit losses based on the fair value of collateral. The allowance for credit losses is calculated on an individual loan basis based on the shortfall between the fair value of the loan’s collateral, which is adjusted for liquidation costs/discounts, and amortized costs. If the fair value of the collateral exceeds the amortized cost, no allowance is required. The following table presents the amortized cost basis of collateral dependent loans, which are individually evaluated to determine expected credit losses: (Dollars in thousands) Real Estate Total Loans December 31, 2023: Commercial real estate $ 783 $ 783 Total $ 783 $ 783 The gross interest income which would have been recorded under the original terms of those nonaccrual loans had they been accruing interest, amounted to approximately $ 47 thousand and $ 26 thousand for the years ended December 31, 2023 and 2022, respectively. Allowance for Credit Losses The Company adopted ASC 326 on January 1, 2023, which introduced the CECL methodology for estimating all expected losses over the life of a financial asset. Under the CECL methodology, the allowance for credit losses is measured on a collective basis for pools of loans with similar risk characteristics, and for loans that do not share similar risk characteristics with the collectively evaluated pools, evaluations are performed on an individual basis. The following table details the changes in the allowance for credit losses by portfolio segment for the years ended December 31, 2023 and 2022. (in thousands) Commercial and industrial Construction and land Development Commercial Real Estate Residential Real Estate Consumer Installment Total Balance, December 31, 2021 $ 857 518 2,739 739 86 $ 4,939 Charge-offs (222) — — — (70) (292) Recoveries 7 — 23 26 62 118 Net (charge-offs) recoveries (215) — 23 26 (8) (174) Provision 105 431 347 63 54 1,000 Balance, December 31, 2022 $ 747 949 3,109 828 132 $ 5,765 Impact of adopting ASC 326 532 (17) 873 (347) (22) 1,019 Charge-offs (164) — — — (105) (269) Recoveries 204 — — 14 5 223 Net recoveries (charge-offs) 40 — — 14 (100) (46) Provision (31) 28 (61) 51 138 125 Balance, December 31, 2023 $ 1,288 960 3,921 546 148 $ 6,863 The following table presents an analysis of the allowance for loan losses and recorded investment in loans by portfolio segment and impairment methodology as of December 31, 2022, as determined, prior to adoption of ASC 326. Collectively evaluated (1) Individually evaluated (2) Total Allowance Recorded Allowance Recorded Allowance Recorded for loan investment for loan investment for loan investment (In thousands) losses in loans losses in loans losses in loans December 31, 2022: Commercial and industrial $ 688 65,769 59 443 747 $ 66,212 Construction and land development 949 66,479 — — 949 66,479 Commercial real estate 2,663 262,457 446 2,116 3,109 264,573 Residential real estate 828 97,648 — — 828 97,648 Consumer installment 132 9,546 — — 132 9,546 Total $ 5,260 501,899 505 2,559 5,765 $ 504,458 (1) Represents loans collectively evaluated for impairment prior to the adoption of ASC 326, in accordance with ASC 450-20, Loss Contingencies, and pursuant to amendments by ASU 2010-20 regards allowance for non-impaired loans. (2) Represents loans individually evaluated for impairment, prior to adoption of ASC 326, in accordance with ASC 310-30, Receivables , pursuant to amendments by ASU 2010-20 regarding allowance for impaired loans. Impaired loans The following tables present impaired loans at December 31, 2022 as determined under ASC 310 prior to the adoption of ASC 326. Loans that have been fully charged-off are not included in the following table. The related allowance generally represents the following components which correspond to impaired loans: ● Individually evaluated impaired loans equal to or greater than $500 thousand secured by real estate (nonaccrual construction and land development, commercial real estate, and residential real estate). ● Individually evaluated impaired loans equal to or greater than $250 thousand not secured by real estate (nonaccrual commercial and industrial and consumer loans). The following table sets forth certain information regarding the Company’s impaired loans that were individually evaluated for impairment at December 31, 2022. December 31, 2022 (In thousands) Unpaid principal balance (1) Charge-offs and payments applied (2) Recorded investment (3) Related allowance With no allowance recorded: Commercial and industrial $ 210 (1) $ 209 $ — Commercial real estate: Owner occupied 858 (3) 855 — Total commercial real estate 858 (3) 855 — Total 1,068 (4) 1,064 — With allowance recorded: Commercial and industrial 234 — 234 59 Commercial real estate: Owner occupied 1,261 — 1,261 446 Total commercial real estate 1,261 — 1,261 446 Total 1,495 — 1,495 505 Total impaired loans $ 2,563 (4) $ 2,559 $ 505 (1) Unpaid principal balance represents the contractual obligation due from the customer. (2) Charge-offs and payments applied represents cumulative charge-offs taken, as well as interest payments that have been applied against the outstanding principal balance subsequent to the loans being placed on nonaccrual status. (3) Recorded investment represents the unpaid principal balance less charge-offs and payments applied; it is shown before any related allowance for loan losses. Pursuant to the adoption of ASU 2022-02, effective January 1, 2023, the Company prospectively discontinued the recognition and measurement guidance previously required for troubled debt restructurings (TDRs). As of December 31, 2023, the Company had no loans that would have previously required disclosure as TDRs. The following table provides the average recorded investment in impaired loans, if any, by portfolio segment, and the amount of interest income recognized on impaired loans after impairment by portfolio segment and class for the year ended December 31, 2022 as determined under ASC 310 prior to adoption of ASC 326. Year ended December 31, 2022 Average recorded Total interest (In thousands) investment income recognized Impaired loans: Commercial and industrial $ 34 $ — Commercial real estate: Owner occupied 163 — Other 153 — Total commercial real estate 316 — Residential real estate: Investment property 5 — Total residential real estate 5 — Total $ 355 $ —