Loans and Allowance for Loan Losses (Tables)

12 Months Ended

Dec. 31, 2020

Financing Receivable, Allowance for Credit Loss [Line Items]

Summary of composition of loan portfolio

The following table summarizes the composition of our loan portfolio. Total gross loans are recorded net of deferred loan fees and costs, which totaled $3.9 million and $3.3 million as of December 31, 2020 and December 31, 2019, respectively.

	December 31,
(dollars in thousands)	2020						2019
Commercial
Owner occupied RE	$	433,320		20.2	%	$	407,851		21.0	%
Non-owner occupied RE		585,269		27.3	%		501,878		25.8	%
Construction		61,467		2.9	%		80,486		4.1	%
Business		307,599		14.4	%		308,123		15.9	%
Total commercial loans		1,387,655		64.8	%		1,298,338		66.8	%
Consumer
Real estate		536,311		25.0	%		398,245		20.5	%
Home equity		156,957		7.3	%		179,738		9.3	%
Construction		40,525		1.9	%		41,471		2.1	%
Other		21,419		1.0	%		25,733		1.3	%
Total consumer loans		755,212		35.2	%		645,187		33.2	%
Total gross loans, net of deferred fees		2,142,867		100.0	%		1,943,525		100.0	%
Less – allowance for loan losses		(44,149	)				(16,642	)
Total loans, net	$	2,098,718				$	1,926,883

Composition of gross loans by rate type

The composition of gross loans by rate type is as follows:

	December 31,
(dollars in thousands)	2020		2019
Floating rate loans	$	400,506	$	432,540
Fixed rate loans		1,742,361		1,510,985
	$	2,142,867	$	1,943,525

Summary of nonperforming assets, including nonaccruing TDRs

The following table shows the nonperforming assets and the related percentage of nonperforming assets to total assets and gross loans. Generally, a loan is placed on nonaccrual status when it becomes 90 days past due as to principal or interest, or when we believe, after considering economic and business conditions and collection efforts, that the borrower’s financial condition is such that collection of the contractual principal or interest on the loan is doubtful. A payment of interest on a loan that is classified as nonaccrual is recognized as a reduction in principal when received.

88

	December 31,
(dollars in thousands)	2020		2019
Commercial
Owner occupied RE	$	-	$	-
Non-owner occupied RE		1,143		188
Construction		139		-
Business		195		235
Consumer
Real estate		2,536		1,829
Home equity		547		431
Construction		-		-
Other		-		-
Nonaccruing troubled debt restructurings		3,509		4,111
Total nonaccrual loans, including nonaccruing TDRs		8,069		6,794
Other real estate owned		1,169		-
Total nonperforming assets	$	9,238	$	6,794
Nonperforming assets as a percentage of:
Total assets		0.37%		0.30%
Gross loans		0.43%		0.35%
Total loans over 90 days past due	$	2,296	$	2,038
Loans over 90 days past due and still accruing		-		-
Accruing TDRs		4,893		5,219

Summary of key information for impaired loans

The table below summarizes key information for impaired loans. Our impaired loans include loans on nonaccrual status and loans modified in a TDR, whether on accrual or nonaccrual status. These impaired loans may have estimated impairment which is included in the allowance for loan losses. Our commercial and consumer impaired loans are evaluated individually to determine the related allowance for loan losses.

					December 31, 2020
			Recorded investment
					Impaired loans		Impaired loans
	Unpaid				with no related		with related		Related
	Principal		Impaired		allowance for		allowance for		allowance for
(dollars in thousands)	Balance		loans		loan losses		loan losses		loan losses
Commercial
Owner occupied RE	$	1,753		1,649		1,497		152		76
Non-owner occupied RE		3,212		2,188		705		1,483		366
Construction		141		139		139		-		-
Business		2,892		2,449		279		2,170		897
Total commercial		7,998		6,425		2,620		3,805		1,339
Consumer
Real estate		4,362		4,031		3,108		923		190
Home equity		2,498		2,371		2,096		275		163
Construction		-		-		-		-		-
Other		135		135		-		135		17
Total consumer		6,995		6,537		5,204		1,333		370
Total	$	14,993		12,962		7,824		5,138		1,709

89

					December 31, 2019
			Recorded investment
					Impaired loans		Impaired loans
	Unpaid				with no related		with related		Related
	Principal		Impaired		allowance for		allowance for		allowance for
(dollars in thousands)	Balance		loans		loan losses		loan losses		loan losses
Commercial
Owner occupied RE	$	2,791		2,726		2,270		456		75
Non-owner occupied RE		4,512		4,051		2,419		1,632		465
Construction		-		-		-		-		-
Business		1,620		1,531		558		973		452
Total commercial		8,923		8,308		5,247		3,061		992
Consumer
Real estate		2,727		2,720		1,638		1,082		364
Home equity		885		838		459		379		66
Construction		-		-		-		-		-
Other		147		147		-		147		16
Total consumer		3,759		3,705		2,097		1,608		446
Total	$	12,682		12,013		7,344		4,669		1,438

Summary of average recorded investment and interest income recognized on impaired loans

The following table provides the average recorded investment in impaired loans and the amount of interest income recognized on impaired loans after impairment by portfolio segment and class.

	Year ended December 31,
	2020					2019			2018
	Average		Recognized		Average		Recognized		Average		Recognized
	recorded		interest		recorded		interest		recorded		interest
(dollars in thousands)	investment		income		investment		income		investment		income
Commercial
Owner occupied RE	$	2,423		88	$	2,739		128		2,784		142
Non-owner occupied RE		4,217		221		4,161		255		2,860		174
Construction		56		6		-		-		-		-
Business		2,306		243		1,582		79		2,883		162
Total commercial		9,002		558		8,482		462		8,527		478
Consumer
Real estate		3,372		170		2,771		131		2,930		151
Home equity		2,128		5		853		42		1,453		99
Construction		-		-		-		-		-		-
Other		141		79		153		5		174		5
Total consumer		5,641		254		3,777		178		4,557		255
Total	$	14,643		812	$	12,259		640		13,084		733

Summary of activity related to allowance for loan losses

The following table summarizes the activity related to our allowance for loan losses:

	Year ended December 31,
(dollars in thousands)	2020			2019			2018
Balance, beginning of period	$	16,642		$	15,762			15,523
Provision for loan losses		29,600			2,300			1,900
Loan charge-offs:
Commercial
Owner occupied RE		(94	)		(110	)		-
Non-owner occupied RE		(1,508	)		(239	)		(432	)
Construction		-			-			-
Business		(1,309	)		(910	)		(695	)
Total commercial		(2,911	)		(1,259	)		(1,127	)
Consumer
Real estate		(134	)		-			(749	)
Home equity		(299	)		(174	)		(217	)
Construction		-			-			-
Other		(70	)		(82	)		(53	)
Total consumer		(503	)		(256	)		(1,019	)
Total loan charge-offs		(3,414	)		(1,515	)		(2,146	)
Loan recoveries:
Commercial
Owner occupied RE		65			-			-
Non-owner occupied RE		670			2			132
Construction		-			-			-
Business		470			43			229
Total commercial		1,205			45			361
Consumer
Real estate		18			37			5
Home equity		69			2			115
Construction		-			-			-
Other		29			11			4
Total consumer		116			50			124
Total recoveries		1,321			95			485
Net loan charge-offs		(2,093	)		(1,420	)		(1,661	)
Balance, end of period	$	44,149		$	16,642			15,762

Summary of allowance for loan losses by commercial and consumer portfolio segments

The following tables summarize the activity in the allowance for loan losses by our commercial and consumer portfolio segments.

	Year ended December 31, 2020
(dollars in thousands)	Commercial			Consumer			Total
Balance, beginning of period	$	11,372			5,270			16,642
Provision		19,500			10,100			29,600
Loan charge-offs		(2,911	)		(503	)		(3,414	)
Loan recoveries		1,205			116			1,321
Net loan charge-offs		(1,706	)		(387	)		(2,093	)
Balance, end of period	$	29,166			14,983			44,149

	Year ended December 31, 2019
	Commercial			Consumer			Total
Balance, beginning of period	$	10,768			4,994			15,762
Provision		1,818			482			2,300
Loan charge-offs		(1,259	)		(256	)		(1,515	)
Loan recoveries		45			50			95
Net loan charge-offs		(1,214	)		(206	)		(1,420	)
Balance, end of period	$	11,372			5,270			16,642

Summary of allowance for loan losses and recorded investment in loans by impairment methodology

The following table disaggregates our allowance for loan losses and recorded investment in loans by method of impairment evaluation.

	December 31, 2020
	Allowance for loan losses						Recorded investment in loans
(dollars in thousands)	Commercial		Consumer		Total		Commercial		Consumer		Total
Individually evaluated	$	1,339		370		1,709		6,425		6,537		12,962
Collectively evaluated		27,826		14,614		42,440		1,381,230		748,675		2,129,905
Total	$	29,165		14,984		44,149		1,387,655		755,212		2,142,867

	December 31, 2019
	Allowance for loan losses						Recorded investment in loans
(dollars in thousands)	Commercial		Consumer		Total		Commercial		Consumer		Total
Individually evaluated	$	992		446		1,438		8,308		3,705		12,013
Collectively evaluated		10,380		4,824		15,204		1,290,030		641,482		1,931,512
Total	$	11,372		5,270		16,642		1,298,338		645,187		1,943,525

Consumer [Member]

Financing Receivable, Allowance for Credit Loss [Line Items]

Outstanding commercial and consumer loans which include loans on nonaccrual by past due status

The following tables provide past due information for outstanding consumer loans and include loans on nonaccrual status.

	December 31, 2020
(dollars in thousands)	Real estate		Home equity		Construction		Other		Total
Current	$	534,648		156,657		40,525		21,419		753,249
30-59 days past due		-		-		-		-		-
60-89 days past due		332		-		-		-		332
Greater than 90 days		1,331		300		-		-		1,631
	$	536,311		156,957		40,525		21,419		755,212

	December 31, 2019
	Real estate		Home equity		Construction		Other		Total
Current	$	396,445		179,051		41,471		25,650		642,617
30-59 days past due		799		369		-		83		1,251
60-89 days past due		-		118		-		-		118
Greater than 90 days		1,001		200		-		-		1,201
	$	398,245		179,738		41,471		25,733		645,187

Summary of breakdown of outstanding loans by risk category

The tables below provide a breakdown of outstanding consumer loans by risk category.

	December 31, 2020
(dollars in thousands)	Real estate		Home equity		Construction		Other		Total
Pass	$	530,515		152,154		40,525		21,290		744,484
Special Mention		1,968		1,005		-		91		3,064
Substandard		3,828		3,798		-		38		7,664
Doubtful		-		-		-		-		-
	$	536,311		156,957		40,525		21,419		755,212

	December 31, 2019
(dollars in thousands)	Real estate		Home equity		Construction		Other		Total
Pass	$	392,572		176,532		41,471		25,421		635,996
Special Mention		2,267		775		-		261		3,303
Substandard		3,406		2,431		-		51		5,888
Doubtful		-		-		-		-		-
	$	398,245		179,738		41,471		25,733		645,187

Commercial [Member]

Financing Receivable, Allowance for Credit Loss [Line Items]

Outstanding commercial and consumer loans which include loans on nonaccrual by past due status

The following tables provide past due information for outstanding commercial loans and include loans on nonaccrual status.

	December 31, 2020
	Owner		Non-owner
(dollars in thousands)	occupied RE		occupied RE		Construction		Business		Total
Current	$	432,711		584,565		61,467		307,261		1,386,004
30-59 days past due		403		282		-		35		720
60-89 days past due		-		-		-		266		266
Greater than 90 days		206		422		-		37		665
	$	433,320		585,269		61,467		307,599		1,387,655

	December 31, 2019
	Owner		Non-owner
	occupied RE		occupied RE		Construction		Business		Total
Current	$	406,594		501,676		80,486		307,710		1,296,466
30-59 days past due		706		151		-		178		1,035
60-89 days past due		-		-		-		-		-
Greater than 90 days		551		51		-		235		837
	$	407,851		501,878		80,486		308,123		1,298,338

Summary of breakdown of outstanding loans by risk category

The tables below provide a breakdown of outstanding commercial loans by risk category.

	December 31, 2020
	Owner		Non-owner
(dollars in thousands)	occupied RE		occupied RE		Construction		Business		Total
Pass	$	430,291		576,095		61,328		301,838		1,369,552
Special Mention		624		587		-		1,703		2,914
Substandard		2,405		8,587		139		4,058		15,189
Doubtful		-		-		-		-		-
	$	433,320		585,269		61,467		307,599		1,387,655

	December 31, 2019
	Owner		Non-owner
(dollars in thousands)	occupied RE		occupied RE		Construction		Business		Total
Pass	$	404,237		492,941		80,486		301,504		1,279,168
Special Mention		1,312		744		-		3,108		5,164
Substandard		2,302		8,193		-		3,511		14,006
Doubtful		-		-		-		-		-
	$	407,851		501,878		80,486		308,123		1,298,338