XML 20 R11.htm IDEA: XBRL DOCUMENT v3.22.2
LOANS AND ALLOWANCE FOR CREDIT LOSSES
6 Months Ended
Jun. 30, 2022
LOANS AND ALLOWANCE [Abstract]  
LOANS AND ALLOWANCE

4.     LOANS AND ALLOWANCE FOR CREDIT LOSSES

The following table summarizes the composition of our loan portfolio as of June 30, 2022 and December 31, 2021 (in thousands):

​

​

​

​

​

​

​

​

    

June 30, 2022

    

December 31, 2021

Loans held for sale

​

$

16,096

​

$

—

Loans secured by real estate:

​

​

​

 

​

  

Commercial real estate - owner occupied

​

​

432,533

​

​

387,703

Commercial real estate - non-owner occupied

​

 

598,974

​

 

588,000

Secured by farmland

​

 

7,951

​

 

8,612

Construction and land development

​

 

117,529

​

 

121,444

Residential 1-4 family

​

 

606,303

​

 

547,560

Multi-family residential

​

 

144,406

​

 

164,071

Home equity lines of credit

​

 

69,860

​

 

73,846

Total real estate loans

​

 

1,977,556

​

 

1,891,236

​

​

​

​

​

​

​

Commercial loans

​

 

447,182

​

 

301,980

Paycheck Protection Program loans

​

​

17,525

​

​

77,319

Consumer loans

​

 

179,691

​

 

60,996

Total Non-PCD loans

​

 

2,621,954

​

 

2,331,531

PCD loans

​

​

6,843

​

​

8,455

Total loans

​

$

2,628,797

​

$

2,339,986

​

​

​

​

​

​

​

​

The accounting policy related to the allowance for credit losses is considered a critical policy given the level of estimation, judgment, and uncertainty in the levels of the allowance required to account for the expected losses in the loan portfolio and the material effect such estimation, judgment, and uncertainty can have on the consolidated financial results.

Accrued Interest Receivable

Accrued interest receivable on loans totaled $9.0 million and $10.8 million at June 30, 2022 and December 31, 2021, respectively, and is included in other assets in the consolidated balance sheets.

Nonaccrual and Past Due Loans

Loans are considered past due if the required principal and interest payments have not been received as of the date such payments were due. Loans are placed on nonaccrual status when, in management’s opinion, the borrower may be unable to meet payment obligations as they become due, as well as when required by regulatory provisions. In determining whether or not a borrower may be unable to meet payment obligations for each class of loans, we consider the borrower’s debt service capacity through the analysis of current financial information, if available, and/or current information with regards to our collateral position. Regulatory provisions would typically require the placement of a loan on nonaccrual status if (i) principal or interest has been in default for a period of 90 days or more unless the loan is both well secured and in the process of collection or (ii) full payment of principal and interest is not expected. Loans may be placed on nonaccrual status regardless of whether or not such loans are considered past due. When interest accrual is discontinued, all unpaid accrued interest is reversed. Interest income on nonaccrual loans is recognized only to the extent that cash payments are received in excess of principal due. A loan may be returned to accrual status when all the principal and interest amounts contractually due are brought current and future principal and interest amounts contractually due are reasonably assured, which is typically evidenced by a sustained period (at least six months) of repayment performance by the borrower.

The following tables present the aging of the recorded investment in past due loans by class of loans as of June 30, 2022 and December 31, 2021 (in thousands):

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

    

30 - 59

    

60 - 89

    

90 

    

​

​

    

​

​

    

​

​

​

​

Days

​

Days

​

Days 

​

Total

​

Loans Not

​

Total

June 30, 2022

​

Past Due

​

Past Due

​

or More

​

Past Due

​

Past Due

​

Loans

Commercial real estate - owner occupied

​

$

387

​

$

136

​

$

—

​

$

523

​

$

432,010

​

$

432,533

Commercial real estate - non-owner occupied

​

 

5,738

​

 

15,709

​

 

—

​

 

21,447

​

 

577,527

​

 

598,974

Secured by farmland

​

​

—

​

​

—

​

​

659

​

​

659

​

​

7,292

​

​

7,951

Construction and land development

​

 

430

​

​

32

​

​

—

​

​

462

​

​

117,067

​

 

117,529

Residential 1-4 family

​

 

1,317

​

​

303

​

​

8,682

​

​

10,302

​

​

596,001

​

 

606,303

Multi- family residential

​

​

—

​

​

—

​

​

—

​

​

—

​

​

144,406

​

​

144,406

Home equity lines of credit

​

 

223

​

​

36

​

 

170

​

 

429

​

 

69,431

​

 

69,860

Commercial loans

​

​

1,976

​

​

1,711

​

​

2,510

​

​

6,197

​

​

440,985

​

​

447,182

Paycheck Protection Program loans

​

​

57

​

​

104

​

​

1,512

​

​

1,673

​

​

15,852

​

​

17,525

Consumer loans

​

 

443

​

​

56

​

 

—

​

 

499

​

 

179,192

​

 

179,691

Total Non-PCD loans

​

​

10,571

​

​

18,087

​

​

13,533

​

​

42,191

​

​

2,579,763

​

​

2,621,954

PCD loans

​

​

135

​

​

1,361

​

​

12

​

​

1,508

​

​

5,335

​

​

6,843

Total

​

$

10,706

​

$

19,448

​

$

13,545

​

$

43,699

​

$

2,585,098

​

$

2,628,797

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

    

30 - 59

    

60 - 89

    

90 

    

​

​

    

​

​

    

​

​

    

​

​

Days

​

Days

​

Days 

​

Total

​

Loans Not

​

Total

​

December 31, 2021

​

Past Due

​

Past Due

​

or More

​

Past Due

​

Past Due

​

Loans

​

Commercial real estate - owner occupied

​

$

194

​

$

346

​

$

—

​

$

540

​

$

387,163

​

$

387,703

​

Commercial real estate - non-owner occupied

​

 

—

​

 

—

​

 

—

​

 

—

​

 

588,000

​

 

588,000

​

Secured by farmland

​

​

791

​

​

—

​

​

—

​

​

791

​

​

7,821

​

​

8,612

​

Construction and land development

​

 

204

​

​

131

​

 

4,575

​

 

4,910

​

 

116,534

​

 

121,444

​

Residential 1-4 family

​

 

9,384

​

​

254

​

 

137

​

 

9,775

​

 

537,785

​

 

547,560

​

Multi- family residential

​

​

—

​

​

—

​

​

—

​

​

—

​

​

164,071

​

​

164,071

​

Home equity lines of credit

​

 

331

​

​

—

​

 

171

​

 

502

​

 

73,344

​

 

73,846

​

Commercial loans

​

​

387

​

​

—

​

​

1,246

​

​

1,633

​

​

300,347

​

​

301,980

​

Paycheck Protection Program loans

​

​

4,954

​

​

8,559

​

​

283

​

​

13,796

​

​

63,523

​

​

77,319

​

Consumer loans

​

 

193

​

​

130

​

 

2

​

 

325

​

 

60,671

​

 

60,996

​

Total Non-PCD loans

​

​

16,438

​

​

9,420

​

​

6,414

​

​

32,272

​

​

2,299,259

​

​

2,331,531

​

PCD loans

​

​

1,717

​

​

—

​

​

—

​

​

1,717

​

​

6,738

​

​

8,455

​

Total

​

$

18,155

​

$

9,420

​

$

6,414

​

$

33,989

​

$

2,305,997

​

$

2,339,986

​

​

​

The amortized cost, by class, of loans and leases on nonaccrual status at June 30, 2022 and December 31, 2021, were as follows (in thousands):

​

​

​

​

​

​

​

​

​

​

​

​

​

​

    

90 

    

​

Less Than

    

Total

    

Nonaccrual With

​

​

Days 

​

​

90 Days

​

Nonaccrual

​

No Credit

June 30, 2022

​

or More

​

​

Past Due

​

Loans (1)

​

Loss Allowance (2)

Commercial real estate - owner occupied

​

$

—

​

$

356

​

$

356

​

$

356

Secured by farmland

​

​

659

​

​

148

​

​

807

​

​

659

Construction and land development

​

 

—

​

 

32

​

 

32

​

 

—

Residential 1-4 family

​

 

8,682

​

 

658

​

 

9,340

​

 

8,600

Multi- family residential

​

​

—

​

​

4,151

​

​

4,151

​

​

4,151

Home equity lines of credit

​

​

170

​

​

469

​

​

639

​

​

23

Commercial loans

​

 

2,510

​

 

400

​

 

2,910

​

 

1,117

Consumer loans

​

 

—

​

 

27

​

 

27

​

 

2

Total Non-PCD loans

​

​

12,021

​

​

6,241

​

​

18,262

​

​

14,908

PCD loans

​

​

12

​

​

1,361

​

​

1,373

​

​

—

Total

​

$

12,033

​

$

7,602

​

$

19,635

​

$

14,908

​

​

​

​

​

​

​

​

​

​

​

​

​

​

    

90 

    

​

Less Than

    

Total

    

Nonaccrual With

​

​

Days 

​

​

90 Days

​

Nonaccrual

​

No Credit

December 31, 2021

​

or More

​

​

Past Due

​

Loans (1)

​

Loss Allowance (2)

Commercial real estate - owner occupied

​

$

—

​

$

842

​

$

842

​

$

842

Secured by farmland

​

​

—

​

​

836

​

​

836

​

​

836

Construction and land development

​

 

4,575

​

 

34

​

 

4,609

​

 

4,609

Residential 1-4 family

​

 

137

​

 

411

​

 

548

​

 

548

Multi- family residential

​

​

—

​

​

4,301

​

​

4,301

​

​

4,301

Home equity lines of credit

​

​

171

​

​

253

​

​

424

​

​

424

Commercial loans

​

 

1,246

​

 

476

​

 

1,722

​

 

745

Consumer loans

​

 

2

​

 

16

​

 

18

​

 

10

Total Non-PCD loans

​

​

6,131

​

​

7,169

​

​

13,300

​

​

12,315

PCD loans

​

​

—

​

​

1,729

​

​

1,729

​

​

—

Total

​

$

6,131

​

$

8,898

​

$

15,029

​

$

12,315

(1)Nonaccrual loans include SBA guaranteed amounts totaling $0.8 million and $1.1 million at June 30, 2022 and December 31, 2021, respectively.
(2)Nonaccrual loans with no credit loss allowance include SBA guaranteed amounts totaling $0.7 million and $1.1 million at June 30, 2022 and December 31, 2021, respectively.

​

We had $1.5 million and $0.3 million of PPP loans greater than 90 days past due and still accruing at June 30, 2022 and December 31, 2021, respectively.

The following table presents nonaccrual loans as of June 30, 2022 by class and year of origination (in thousands):

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Revolving

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Loans

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Revolving

​

Converted

​

​

​

​

​

2022

​

2021

​

2020

​

2019

 

2018

​

Prior

​

Loans

​

To Term

 

Total

Commercial real estate - owner occupied

​

$

—

​

$

—

​

$

—

​

$

—

​

$

—

​

$

356

​

$

—

​

$

—

​

$

356

Secured by farmland

​

​

—

​

​

—

​

​

—

​

​

19

​

​

—

​

​

659

​

​

—

​

​

129

​

​

807

Construction and land development

​

 

—

​

 

—

​

 

—

​

 

—

​

 

—

​

 

32

​

 

—

​

 

—

​

 

32

Residential 1-4 family

​

​

—

​

 

—

​

​

—

​

​

8,600

​

​

—

​

​

475

​

​

—

​

​

265

​

​

9,340

Multi- family residential

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

4,151

​

​

—

​

​

—

​

​

4,151

Home equity lines of credit

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

616

​

​

23

​

​

639

Commercial loans

​

 

—

​

 

—

​

 

7

​

 

—

​

 

1,502

​

 

245

​

 

1,156

​

 

—

​

 

2,910

Paycheck Protection Program loans

​

 

—

​

 

​

​

 

—

​

 

—

​

 

—

​

 

—

​

 

—

​

 

—

​

 

—

Consumer loans

​

​

—

​

 

—

​

​

—

​

​

—

​

​

2

​

​

6

​

​

19

​

​

—

​

​

27

Total non-PCD nonaccruals

​

​

—

​

​

—

​

​

7

​

​

8,619

​

​

1,504

​

​

5,924

​

​

1,791

​

​

417

​

​

18,262

PCD loans

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

1,373

​

​

—

​

​

—

​

​

1,373

Total nonaccrual loans

​

$

—

​

$

—

​

$

7

​

$

8,619

​

$

1,504

​

$

7,297

​

$

1,791

​

$

417

​

$

19,635

​

Interest received on nonaccrual loans was $0.1 million and $0.05 million for the three months ended June 30, 2022 and 2021, respectively, and $0.3 million and $0.09 million for the six months ended June 30, 2022 and 2021, respectively.

Troubled Debt Restructurings

A modification is classified as a TDR if both of the following exist: (1) the borrower is experiencing financial difficulty and (2) the Bank has granted a concession to the borrower. The Bank determines that a borrower may be experiencing financial difficulty if the borrower is currently delinquent on any of its debt, or if the Bank is concerned that the borrower may not be able to perform in accordance with the current terms of the loan agreement in the foreseeable future. Many aspects of the borrower’s financial situation are assessed when determining whether they are experiencing financial difficulty, particularly as it relates to commercial borrowers due to the complex nature of the loan structure, business/industry risk and borrower/guarantor structures. Concessions may include the reduction of an interest rate at a rate lower than current market rates for a new loan with similar risk, extension of the maturity date, reduction of accrued interest, or principal forgiveness. When evaluating whether a concession has been granted, the Bank also considers whether the borrower has provided additional collateral or guarantors and whether such additions adequately compensate the Bank for the restructured terms, or if the revised terms are consistent with those currently being offered to new loan customers. The assessments of whether a borrower is experiencing (or is likely to experience) financial difficulty and whether a concession has been granted is subjective in nature and management’s judgment is required when determining whether a modification is a TDR.

Although each occurrence is unique to the borrower and is evaluated separately, for all portfolio segments, TDRs are typically modified through reduction in interest rates, reductions in payments, changing the payment terms from principal and interest to interest only, and/or extensions in term maturity.

As of June 30, 2022, there were 11 TDR loans outstanding in the amount of $2.7 million primarily due to the economic impact of COVID-19 on certain of the Bank’s borrowers. There have been no defaults of TDRs modified during the past twelve months.

Credit Quality Indicators

Through its system of internal controls, Primis evaluates and segments loan portfolio credit quality using regulatory definitions for Special Mention, Substandard and Doubtful. Special Mention loans are considered to be criticized. Substandard and Doubtful loans are considered to be classified.

Special Mention loans are loans that have a potential weakness that deserve management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or of the institution’s credit position.

Substandard loans may be 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 the institution will sustain some loss if the deficiencies are not corrected.

Doubtful loans 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. Primis had no loans classified Doubtful at June 30, 2022 or December 31, 2021.

In monitoring credit quality trends in the context of assessing the appropriate level of the allowance for credit losses on loans, we monitor portfolio credit quality by the weighted-average risk grade of each class of loan.

​

The following table presents weighted-average risk grades for all loans, by class and year of origination/renewal as of June 30, 2022 (in thousands):

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Revolving

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Loans

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Revolving

​

Converted

​

​

​

​

​

2022

​

2021

​

2020

​

2019

 

2018

​

Prior

​

Loans

​

To Term

 

Total

Commercial real estate - owner occupied

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Pass

​

$

48,503

​

$

60,905

​

$

19,728

​

$

34,832

​

$

27,892

​

$

219,330

​

$

10,509

​

$

6,838

​

$

428,537

Special Mention

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

1,190

​

​

—

​

​

—

​

​

1,190

Substandard

​

​

—

​

​

—

​

​

—

​

​

1

​

​

—

​

​

2,805

​

​

—

​

​

—

​

​

2,806

Doubtful

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

$

48,503

​

$

60,905

​

$

19,728

​

$

34,833

​

$

27,892

​

$

223,325

​

$

10,509

​

$

6,838

​

$

432,533

Weighted average risk grade

​

​

3.20

​

​

3.49

​

​

3.38

​

​

3.49

​

​

3.43

​

​

3.52

​

​

3.16

​

​

3.96

​

​

3.46

Commercial real estate - nonowner occupied

​

 

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Pass

​

$

22,983

​

$

122,209

​

$

36,361

​

$

31,382

​

$

61,577

​

$

262,383

​

$

3,001

​

$

3,099

​

$

542,995

Special Mention

​

​

—

​

​

—

​

​

—

​

​

—

​

​

15,072

​

​

40,306

​

​

—

​

​

601

​

​

55,979

Substandard

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

Doubtful

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

$

22,983

​

$

122,209

​

$

36,361

​

$

31,382

​

$

76,649

​

$

302,689

​

$

3,001

​

$

3,700

​

$

598,974

Weighted average risk grade

​

​

3.22

​

​

3.17

​

​

3.71

​

​

3.92

​

​

3.83

​

​

3.82

​

​

2.67

​

​

3.32

​

​

3.66

Secured by farmland

​

 

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Pass

​

$

857

​

$

23

​

$

60

​

$

—

​

$

—

​

$

3,580

​

$

1,499

​

$

92

​

$

6,111

Special Mention

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

1,033

​

​

—

​

​

—

​

​

1,033

Substandard

​

​

—

​

​

—

​

​

—

​

​

19

​

​

—

​

​

659

​

​

—

​

​

129

​

​

807

Doubtful

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

$

857

​

$

23

​

$

60

​

$

19

​

$

—

​

$

5,272

​

$

1,499

​

$

221

​

$

7,951

Weighted average risk grade

​

​

3.43

​

​

4.00

​

​

4.00

​

​

6.00

​

​

N/A

​

​

4.18

​

​

3.98

​

​

4.33

​

​

4.07

Construction and land development

​

 

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Pass

​

$

15,995

​

$

62,404

​

$

9,687

​

$

1,477

​

$

7,564

​

$

19,385

​

$

961

​

$

24

​

$

117,497

Special Mention

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

Substandard

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

32

​

​

—

​

​

—

​

​

32

Doubtful

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

$

15,995

​

$

62,404

​

$

9,687

​

$

1,477

​

$

7,564

​

$

19,417

​

$

961

​

$

24

​

$

117,529

Weighted average risk grade

​

​

3.29

​

​

3.12

​

​

3.80

​

​

3.68

​

​

3.24

​

​

3.67

​

​

3.31

​

​

4.00

​

​

3.31

Residential 1-4 family

​

 

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Pass

​

$

120,609

​

$

157,734

​

$

46,431

​

$

65,915

​

$

43,122

​

$

157,392

​

$

1,935

​

$

3,179

​

$

596,317

Special Mention

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

Substandard

​

​

—

​

​

—

​

​

—

​

​

8,599

​

​

—

​

​

1,122

​

​

—

​

​

265

​

​

9,986

Doubtful

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

$

120,609

​

$

157,734

​

$

46,431

​

$

74,514

​

$

43,122

​

$

158,514

​

$

1,935

​

$

3,444

​

$

606,303

Weighted average risk grade

​

​

3.09

​

​

3.04

​

​

3.07

​

​

3.40

​

​

3.13

​

​

3.23

​

​

3.90

​

​

3.27

​

​

3.16

Multi- family residential

​

 

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Pass

​

$

3,382

​

$

22,187

​

$

18,604

​

$

7,142

​

$

2,834

​

$

78,732

​

$

306

​

$

704

​

$

133,891

Special Mention

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

5,327

​

​

—

​

​

—

​

​

5,327

Substandard

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

4,889

​

​

—

​

​

299

​

​

5,188

Doubtful

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

$

3,382

​

$

22,187

​

$

18,604

​

$

7,142

​

$

2,834

​

$

88,948

​

$

306

​

$

1,003

​

$

144,406

Weighted average risk grade

​

​

3.59

​

​

3.00

​

​

3.90

​

​

3.00

​

​

3.49

​

​

3.55

​

​

4.00

​

​

4.60

​

​

3.49

Home equity lines of credit

​

 

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Pass

​

$

168

​

$

590

​

$

55

​

$

71

​

$

231

​

$

4,601

​

$

62,356

​

$

872

​

$

68,944

Special Mention

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

276

​

​

—

​

​

276

Substandard

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

617

​

​

23

​

​

640

Doubtful

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

$

168

​

$

590

​

$

55

​

$

71

​

$

231

​

$

4,601

​

$

63,249

​

$

895

​

$

69,860

Weighted average risk grade

​

​

3.00

​

​

3.00

​

​

3.00

​

​

3.00

​

​

3.00

​

​

3.81

​

​

3.07

​

​

4.05

​

​

3.13

Commercial loans

​

 

​

​

 

​

​

 

​

​

 

​

​

 

​

​

 

​

​

 

​

​

 

​

​

 

​

Pass

​

$

176,511

​

$

68,077

​

$

9,581

​

$

8,472

​

$

9,870

​

$

23,506

​

$

97,155

​

$

45,432

​

$

438,604

Special Mention

​

​

—

​

​

—

​

​

—

​

​

1,997

​

​

—

​

​

—

​

​

509

​

​

—

​

​

2,506

Substandard

​

​

—

​

​

—

​

​

7

​

​

—

​

​

1,502

​

​

1,817

​

​

2,746

​

​

—

​

​

6,072

Doubtful

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

$

176,511

​

$

68,077

​

$

9,588

​

$

10,469

​

$

11,372

​

$

25,323

​

$

100,410

​

$

45,432

​

$

447,182

Weighted average risk grade

​

​

2.95

​

​

3.41

​

​

3.40

​

​

3.99

​

​

3.77

​

​

3.72

​

​

3.26

​

​

3.72

​

​

3.27

Paycheck Protection Program loans

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Pass

​

$

—

​

$

14,440

​

$

3,085

​

$

—

​

$

—

​

$

—

​

$

—

​

$

—

​

$

17,525

Special Mention

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

Substandard

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

Doubtful

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

$

—

​

$

14,440

​

$

3,085

​

$

—

​

$

—

​

$

—

​

$

—

​

$

—

​

$

17,525

Weighted average risk grade

​

​

N/A

​

​

2.00

​

​

2.00

​

​

N/A

​

​

N/A

​

​

N/A

​

​

N/A

​

​

N/A

​

​

2.00

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Revolving

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Loans

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Revolving

​

Converted

​

​

​

​

​

2022

​

2021

​

2020

​

2019

 

2018

​

Prior

​

Loans

​

To Term

 

Total

Consumer loans

​

 

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Pass

​

$

136,676

​

$

31,200

​

$

1,885

​

$

551

​

$

679

​

$

5,002

​

$

3,569

​

$

—

​

$

179,562

Special Mention

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

72

​

​

—

​

​

—

​

​

72

Substandard

​

​

—

​

​

30

​

​

—

​

​

—

​

​

2

​

​

6

​

​

19

​

​

—

​

​

57

Doubtful

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

$

136,676

​

$

31,230

​

$

1,885

​

$

551

​

$

681

​

$

5,080

​

$

3,588

​

$

—

​

$

179,691

Weighted average risk grade

​

​

3.11

​

​

3.81

​

​

3.99

​

​

3.99

​

​

4.01

​

​

4.02

​

​

3.96

​

​

N/A

​

​

3.29

PCD

​

 

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

 

​

​

 

​

Pass

​

$

—

​

$

—

​

$

—

​

$

—

​

$

—

​

$

3,960

​

$

—

​

$

—

​

$

3,960

Special Mention

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

1,353

​

​

—

​

​

—

​

​

1,353

Substandard

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

1,530

​

​

—

​

​

—

​

​

1,530

Doubtful

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

$

—

​

$

—

​

$

—

​

$

—

​

$

—

​

$

6,843

​

$

—

​

$

—

​

$

6,843

Weighted average risk grade

​

​

N/A

​

​

N/A

​

​

N/A

​

​

N/A

​

​

N/A

​

​

4.48

​

​

N/A

​

​

N/A

​

​

4.48

Total

​

$

525,684

​

$

539,799

​

$

145,484

​

$

160,458

​

$

170,345

​

$

840,012

​

$

185,458

​

$

61,557

​

$

2,628,797

Weighted average risk grade

​

​

3.07

​

​

3.19

​

​

3.44

​

​

3.55

​

​

3.55

​

​

3.60

​

​

3.21

​

​

3.72

​

​

3.37

​

​

The following table presents weighted-average risk grades for all loans, by class and year of origination/renewal as of December 31, 2021 (in thousands):

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Revolving

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Loans

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Revolving

​

Converted

​

​

​

​

​

2021

​

2020

​

2019

​

2018

 

2017

​

Prior

​

Loans

​

To Term

 

Total

Commercial real estate - owner occupied

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Pass

​

$

58,596

​

$

18,411

​

$

35,498

​

$

28,163

​

$

45,013

​

$

187,461

​

$

3,010

​

$

6,937

​

$

383,089

Special Mention

​

​

—

​

​

—

​

​

—

​

​

—

​

​

140

​

​

1,184

​

​

—

​

​

—

​

​

1,324

Substandard

​

​

—

​

​

—

​

​

475

​

​

—

​

​

—

​

​

2,815

​

​

—

​

​

—

​

​

3,290

Doubtful

​

​

—

​

​

​

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

$

58,596

​

$

18,411

​

$

35,973

​

$

28,163

​

$

45,153

​

$

191,460

​

$

3,010

​

$

6,937

​

$

387,703

Weighted average risk grade

​

​

3.43

​

​

3.42

​

​

3.47

​

​

3.43

​

​

3.55

​

​

3.53

​

​

3.29

​

​

3.96

​

​

3.51

Commercial real estate - nonowner occupied

​

 

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Pass

​

$

107,572

​

$

55,956

​

​

19,816

​

$

76,076

​

$

58,883

​

$

235,676

​

$

3,668

​

$

—

​

$

557,647

Special Mention

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

12,097

​

​

—

​

​

—

​

​

12,097

Substandard

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

17,655

​

​

—

​

​

601

​

​

18,256

Doubtful

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

$

107,572

​

$

55,956

​

$

19,816

​

$

76,076

​

$

58,883

​

$

265,428

​

$

3,668

​

$

601

​

$

588,000

Weighted average risk grade

​

​

3.05

​

​

3.47

​

​

3.83

​

​

3.45

​

​

3.81

​

​

3.81

​

​

2.94

​

​

6.00

​

​

3.59

Secured by farmland

​

 

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Pass

​

$

320

​

$

66

​

$

—

​

$

—

​

$

445

​

$

3,734

​

$

1,955

​

$

—

​

$

6,520

Special Mention

​

​

—

​

​

—

​

​

—

​

​

—

​

​

852

​

​

404

​

​

—

​

​

—

​

​

1,256

Substandard

​

​

—

​

​

—

​

​

24

​

​

—

​

​

681

​

​

—

​

​

131

​

​

—

​

​

836

Doubtful

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

$

320

​

$

66

​

$

24

​

$

—

​

$

1,978

​

$

4,138

​

$

2,086

​

$

—

​

$

8,612

Weighted average risk grade

​

​

3.17

​

​

4.00

​

​

6.00

​

​

N/A

​

​

5.04

​

​

3.61

​

​

4.09

​

​

N/A

​

​

4.05

Construction and land development

​

 

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Pass

​

$

57,320

​

$

14,003

​

$

13,360

​

$

7,061

​

$

8,414

​

$

15,664

​

$

982

​

$

31

​

$

116,835

Special Mention

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

Substandard

​

​

—

​

​

—

​

​

4,575

​

​

—

​

​

—

​

​

34

​

​

—

​

​

—

​

​

4,609

Doubtful

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

$

57,320

​

$

14,003

​

$

17,935

​

$

7,061

​

$

8,414

​

$

15,698

​

$

982

​

$

31

​

$

121,444

Weighted average risk grade

​

​

3.15

​

​

3.56

​

​

4.48

​

​

3.26

​

​

3.91

​

​

3.54

​

​

3.31

​

​

4.00

​

​

3.50

Residential 1-4 family

​

 

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Pass

​

$

165,106

​

$

54,037

​

$

81,905

​

$

49,694

​

$

43,173

​

$

138,711

​

$

1,845

​

$

3,484

​

$

537,955

Special Mention

​

​

—

​

​

—

​

​

8,514

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

8,514

Substandard

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

795

​

​

—

​

​

296

​

​

1,091

Doubtful

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

$

165,106

​

$

54,037

​

$

90,419

​

$

49,694

​

$

43,173

​

$

139,506

​

$

1,845

​

$

3,780

​

$

547,560

Weighted average risk grade

​

​

3.04

​

​

3.06

​

​

3.24

​

​

3.13

​

​

3.07

​

​

3.26

​

​

3.98

​

​

3.30

​

​

3.15

Multi- family residential

​

 

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Pass

​

$

37,030

​

$

18,866

​

$

7,228

​

$

6,328

​

$

36,574

​

$

42,310

​

$

5,031

​

$

—

​

$

153,367

Special Mention

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

5,326

​

​

—

​

​

—

​

​

5,326

Substandard

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

5,076

​

​

—

​

​

302

​

​

5,378

Doubtful

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

$

37,030

​

$

18,866

​

$

7,228

​

$

6,328

​

$

36,574

​

$

52,712

​

$

5,031

​

$

302

​

$

164,071

Weighted average risk grade

​

​

3.40

​

​

3.90

​

​

3.00

​

​

3.59

​

​

3.00

​

​

3.92

​

​

4.00

​

​

6.00

​

​

3.55

Home equity lines of credit

​

 

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Pass

​

$

715

​

$

59

​

$

75

​

$

235

​

$

425

​

$

4,337

​

$

67,157

​

$

143

​

$

73,146

Special Mention

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

276

​

​

—

​

​

276

Substandard

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

398

​

​

26

​

​

424

Doubtful

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

$

715

​

$

59

​

$

75

​

$

235

​

$

425

​

$

4,337

​

$

67,831

​

$

169

​

$

73,846

Weighted average risk grade

​

​

3.00

​

​

3.00

​

​

3.00

​

​

3.00

​

​

3.77

​

​

3.79

​

​

3.09

​

​

4.31

​

​

3.14

Commercial loans

​

 

​

​

 

​

​

 

​

​

 

​

​

 

​

​

 

​

​

 

​

​

 

​

​

 

​

Pass

​

$

95,085

​

$

10,415

​

$

11,923

​

$

10,648

​

$

10,522

​

$

18,284

​

$

134,302

​

$

5,338

​

$

296,517

Special Mention

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

845

​

​

—

​

​

845

Substandard

​

​

—

​

​

9

​

​

—

​

​

1,508

​

​

—

​

​

1,938

​

​

1,163

​

​

—

​

​

4,618

Doubtful

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

$

95,085

​

$

10,424

​

$

11,923

​

$

12,156

​

$

10,522

​

$

20,222

​

$

136,310

​

$

5,338

​

$

301,980

Weighted average risk grade

​

​

3.43

​

​

3.36

​

​

3.79

​

​

3.77

​

​

2.95

​

​

3.96

​

​

3.43

​

​

3.95

​

​

3.48

Paycheck Protection Program loans

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Pass

​

$

56,087

​

$

21,232

​

$

—

​

$

—

​

$

—

​

$

—

​

$

—

​

$

—

​

$

77,319

Special Mention

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

Substandard

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

Doubtful

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

$

56,087

​

$

21,232

​

$

—

​

$

—

​

$

—

​

$

—

​

$

—

​

$

—

​

$

77,319

Weighted average risk grade

​

​

2.00

​

​

2.00

​

​

N/A

​

​

N/A

​

​

N/A

​

​

N/A

​

​

N/A

​

​

N/A

​

​

2.00

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Revolving

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Loans

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Revolving

​

Converted

​

​

​

​

​

2021

​

2020

​

2019

​

2018

 

2017

​

Prior

​

Loans

​

To Term

 

Total

Consumer loans

​

 

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Pass

​

$

48,107

​

$

2,351

​

$

1,002

​

$

914

​

$

237

​

$

5,766

​

$

2,519

​

$

—

​

$

60,896

Special Mention

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

82

​

​

—

​

​

—

​

​

82

Substandard

​

​

—

​

​

—

​

​

—

​

​

7

​

​

9

​

​

2

​

​

—

​

​

—

​

​

18

Doubtful

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

$

48,107

​

$

2,351

​

$

1,002

​

$

921

​

$

246

​

$

5,850

​

$

2,519

​

$

—

​

$

60,996

Weighted average risk grade

​

​

3.55

​

​

3.99

​

​

3.99

​

​

4.02

​

​

4.07

​

​

4.01

​

​

4.00

​

​

N/A

​

​

3.65

PCD

​

 

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

 

​

​

 

​

Pass

​

$

—

​

$

—

​

$

—

​

$

—

​

$

—

​

$

5,145

​

$

30

​

$

—

​

$

5,175

Special Mention

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

1,391

​

​

—

​

​

—

​

​

1,391

Substandard

​

​

—

​

​

—

​

​

—

​

​

—

​

​

1,717

​

​

172

​

​

—

​

​

—

​

​

1,889

Doubtful

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

$

—

​

$

—

​

$

—

​

$

—

​

$

1,717

​

$

6,708

​

$

30

​

$

—

​

$

8,455

Weighted average risk grade

​

​

N/A

​

​

N/A

​

​

N/A

​

​

N/A

​

​

6.00

​

​

4.08

​

​

3.00

​

​

N/A

​

​

4.47

Total

​

$

625,938

​

$

195,405

​

$

184,395

​

$

180,634

​

$

207,085

​

$

706,059

​

$

223,312

​

$

17,158

​

$

2,339,986

Weighted average risk grade

​

​

3.12

​

​

3.24

​

​

3.50

​

​

3.38

​

​

3.45

​

​

3.64

​

​

3.35

​

​

3.92

​

​

3.39

​

Revolving loans that converted to term during 2022 were as follows (in thousands):

​

​

​

​

​

​

​

​

​

​

For the three months ended June 30, 2022

​

​

For the six months ended June 30, 2022

Commercial real estate - non-owner occupied

​

$

3,099

​

​

$

3,099

Secured by farmland

​

​

129

​

​

​

220

Residential 1-4 family

​

​

174

​

​

​

422

Multi- family residential

​

​

704

​

​

​

704

Home equity lines of credit

​

​

—

​

​

​

740

Commercial loans

​

 

40,325

​

​

 

40,459

Total loans

​

$

44,431

​

​

$

45,644

​

The amount of foreclosed residential real estate property held at June 30, 2022 and December 31, 2021 was $0.8 million and $0.9 million, respectively. There were no recorded investments in consumer mortgage loans collateralized by residential real estate property in the process of foreclosure at June 30, 2022 and December 31, 2021.

Allowance For Credit Losses – Loans

The allowance for credit losses on loans is a contra-asset valuation account, calculated in accordance with ASC 326 that is deducted from the amortized cost basis of loans to present the net amount expected to be collected. The amount of the allowance represents management's best estimate of current expected credit losses on loans considering available information, from internal and external sources, relevant to assessing collectability over the loans' contractual terms, adjusted for expected prepayments when appropriate.

In calculating the allowance for credit losses, most loans are segmented into pools based upon similar characteristics and risk profiles. For allowance modeling purposes, our loan pools include (i) commercial real estate - owner occupied, (ii) commercial real estate - non-owner occupied, (iii) construction and land development, (iv) commercial, (v) agricultural loans, (vi) residential 1-4 family and (vii) consumer loans. We periodically reassess each pool to ensure the loans within the pool continue to share similar characteristics and risk profiles and to determine whether further segmentation is necessary. For each loan pool, we measure expected credit losses over the life of each loan utilizing a combination of inputs: (i) probability of default, (ii) probability of attrition, (iii) loss given default and (iv) exposure at default. Internal data is supplemented by, but not replaced by, peer data when required, primarily to determine the probability of default input. The various pool-specific inputs may be adjusted for current macroeconomic assumptions. Significant macroeconomic variables utilized in our allowance models include, among other things, (i) VA Gross Domestic Product, (ii) VA House Price Index, and (iii) VA unemployment rates.

Management qualitatively adjusts allowance model results for risk factors that are not considered within our quantitative modeling processes but are nonetheless relevant in assessing the expected credit losses within our loan pools. Qualitative factor (“Q-Factor”) adjustments are driven by key risk indicators that management tracks on a pool-by-pool basis. 

In some cases, management may determine that an individual loan exhibits unique risk characteristics which differentiate the loan from other loans within our loan pools. In such cases, the loans are evaluated for expected credit losses on an individual basis and excluded from the collective evaluation.

The following tables present details of the allowance for credit losses on loans segregated by loan portfolio segment as of June 30, 2022 and December 31, 2021, calculated in accordance with the current expected credit losses (“CECL”) methodology described above (in thousands). 

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

    

Commercial

    

Commercial

    

​

​

    

​

​

    

​

​

    

​

​

    

Home

    

​

​

    

​

​

    

​

​

    

​

​

    

​

​

​

​

Real Estate

​

Real Estate

​

​

​

Construction

​

​

​

​

​

​

​

Equity

​

​

​

​

Paycheck

​

​

​

​

​

 

​

​

​

Owner

​

Non-owner

​

Secured by

​

and Land

​

1-4 Family

​

Multi-Family

​

Lines Of

​

Commercial

​

Protection

​

Consumer

​

PCD

​

 

​

June 30, 2022

​

Occupied

​

Occupied

​

Farmland

​

Development

​

Residential 

​

Residential 

​

Credit

​

Loans

​

Program

​

Loans

​

Loans

​

Total

Modeled expected credit losses

​

$

4,014

 

$

7,411

 

$

10

 

$

610

 

$

3,431

 

$

1,715

 

$

272

 

$

3,592

 

$

—

 

$

1,550

 

$

—

​

$

22,605

Q-factor and other qualitative adjustments

​

​

287

​

​

506

​

​

39

​

​

414

​

​

841

​

​

445

​

​

91

​

​

809

​

​

—

​

​

—

​

​

—

​

​

3,432

Specific allocations

​

 

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

—

​

​

2,027

​

​

—

​

​

19

​

​

2,126

​

 

4,172

Total

​

$

4,301

​

$

7,917

​

$

49

​

$

1,024

​

$

4,272

​

$

2,160

​

$

363

​

$

6,428

​

$

—

​

$

1,569

​

$

2,126

​

$

30,209

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

    

Commercial

    

Commercial

    

​

​

    

​

​

    

​

​

    

​

​

    

Home

    

​

​

    

​

​

    

​

​

    

​

​

    

​

​

​

​

Real Estate

​

Real Estate

​

​

​

Construction

​

​

​

​

​

​

​

Equity

​

​

​

​

Paycheck

​

​

​

​

​

 

​

​

​

Owner

​

Non-owner

​

Secured by

​

and Land

​

1-4 Family

​

Multi-Family

​

Lines Of

​

Commercial

​

Protection

​

Consumer

​

PCD

​

 

​

December 31, 2021

​

Occupied

​

Occupied

​

Farmland

​

Development

​

Residential 

​

Residential 

​

Credit

​

Loans

​

Program

​

Loans

​

Loans

​

Total

Modeled expected credit losses

​

$

4,281

​

$

8,020

​

$

9

​

$

540

​

$

3,012

​

$

1,885

​

$

273

​

$

2,154

​

$

—

​

$

786

​

$

—

​

$

20,960

Q-factor and other qualitative adjustments

​

​

281

​

​

1,008

​

​

47

​

​

458

​

​

576

​

​

1,395

​

​

164

​

​

1,276

​

​

—

​

​

—

​

​

—

​

​

5,205

Specific allocations

​

 

—

​

 

—

​

 

—

​

 

—

​

 

—

​

 

—

​

 

—

​

 

658

​

 

—

​

 

1

​

 

2,281

​

 

2,940

Total

​

$

4,562

​

$

9,028

​

$

56

​

$

998

​

$

3,588

​

$

3,280

​

$

437

​

$

4,088

​

$

—

​

$

787

​

$

2,281

​

$

29,105

​

No allowance for credit losses has been recognized for PPP loans as such loans are fully guaranteed by the SBA.

​

Activity in the allowance for credit losses by class of loan for the three months ended June 30, 2022 and 2021 is summarized below (in thousands):

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Commercial

Commercial

    

​

    

​

    

​

    

​

    

​

    

​

    

​

    

​

 

​

​

Real Estate

Real Estate

​

Construction

​

​

​

​

Home Equity

​

​

​

​

​

 

​

​

Owner

Non-owner

Secured by

and Land

1-4 Family

Multi-Family

Lines Of

Commercial

Consumer

PCD

​

Three Months Ended June 30, 2022

Occupied

Occupied 

Farmland

Development

Residential

Residential 

Credit

Loans

Loans

Loans

Total

Allowance for credit losses:

​

  

​

  

​

  

​

  

​

  

​

  

​

  

​

  

​

  

​

  

​

  

Beginning balance

$

4,173

$

8,913

$

49

$

1,029

$

3,888

$

2,289

$

376

$

5,466

$

1,025

$

2,171

$

29,379

Provision (recovery)

​

142

 

(1,498)

 

—

 

(5)

 

384

 

(129)

 

(14)

 

962

 

625

 

(45)

​

422

Charge offs

 

(14)

 

—

 

—

 

—

 

—

 

—

 

—

 

—

 

(84)

 

—

 

(98)

Recoveries

 

—

 

502

 

—

 

—

 

—

 

—

 

1

 

—

 

3

 

—

 

506

Ending balance

$

4,301

$

7,917

$

49

$

1,024

$

4,272

$

2,160

$

363

$

6,428

$

1,569

$

2,126

$

30,209

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Three Months Ended June 30, 2021

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Allowance for credit losses:

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Beginning balance

$

4,144

$

13,804

$

111

$

3,066

$

6,770

$

1,246

$

825

$

2,192

$

369

$

2,366

$

34,893

Provision (recovery)

 

794

​

(2,569)

​

(31)

​

(375)

​

(2,328)

​

(157)

​

(224)

​

633

​

70

​

(28)

 

(4,215)

Charge offs

 

(169)

​

—

​

—

​

—

​

—

​

—

​

—

​

—

​

(18)

​

—

​

(187)

Recoveries

 

—

​

—

​

—

​

—

​

9

​

1

​

—

​

757

​

7

​

—

​

774

Ending balance

$

4,769

$

11,235

$

80

$

2,691

$

4,451

$

1,090

$

601

$

3,582

$

428

$

2,338

$

31,265

​

Activity in the allowance for credit losses by class of loan for the six months ended June 30, 2022 and 2021 is summarized below (in thousands):

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Commercial

Commercial

    

​

    

​

    

​

    

​

    

​

    

​

    

​

    

​

 

​

​

Real Estate

Real Estate

​

Construction

​

​

​

​

Home Equity

​

​

​

​

​

 

​

​

Owner

Non-owner

Secured by

and Land

1-4 Family

Multi-Family

Lines Of

Commercial

Consumer

PCD

​

Six Months Ended June 30, 2022

Occupied

Occupied 

Farmland

Development

Residential

Residential 

Credit

Loans

Loans

Loans

Total

Allowance for credit losses:

​

  

​

  

​

  

​

  

​

  

​

  

​

  

​

  

​

  

​

  

​

  

Beginning balance

$

4,562

$

9,028

$

56

$

998

$

3,588

$

3,280

$

437

$

4,088

$

787

$

2,281

$

29,105

Provision (recovery)

​

(247)

​

(1,613)

​

(7)

​

26

​

627

​

(1,120)

​

(61)

​

2,170

​

901

​

(155)

​

521

Charge offs

 

(14)

 

—

 

—

 

—

 

—

 

—

 

(14)

 

—

 

(131)

 

—

 

(159)

Recoveries

 

—

 

502

 

—

 

—

 

57

 

—

 

1

 

170

 

12

 

—

 

742

Ending balance

$

4,301

$

7,917

$

49

$

1,024

$

4,272

$

2,160

$

363

$

6,428

$

1,569

$

2,126

$

30,209

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Six Months Ended June 30, 2021

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Allowance for credit losses:

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

Beginning balance

$

6,699

$

11,426

$

104

$

1,815

$

9,579

$

1,412

$

901

$

1,498

$

517

$

2,394

$

36,345

Provision (recovery)

​

(1,761)

​

(191)

​

(24)

​

876

​

(5,138)

​

(323)

​

(300)

​

1,393

​

(63)

​

(56)

​

(5,587)

Charge offs

 

(169)

 

—

 

—

 

—

 

—

 

—

 

—

 

(74)

 

(54)

 

—

 

(297)

Recoveries

 

—

 

—

 

—

 

—

 

10

 

1

 

—

 

765

 

28

 

—

 

804

Ending balance

$

4,769

$

11,235

$

80

$

2,691

$

4,451

$

1,090

$

601

$

3,582

$

428

$

2,338

$

31,265

​

Generally, a commercial loan, or a portion thereof, is charged-off when it is determined, through the analysis of any available current financial information with regards to the borrower, that the borrower is incapable of servicing unsecured debt, there is little or no prospect for near term improvement and no realistic strengthening action of significance is pending or, in the case of secured debt, when it is determined, through analysis of current information with regards to our collateral position, that amounts due from the borrower are in excess of the calculated current fair value of the collateral. Losses on installment loans are recognized in accordance with regulatory guidelines.  All other consumer loan losses are recognized when delinquency exceeds 120 cumulative days.

​

The following table presents loans that were evaluated for expected credit losses on an individual basis and the related specific allocations, by loan portfolio segment as of June 30, 2022 and December 31, 2021 (in thousands):

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

June 30, 2022

    

December 31, 2021

​

​

Loan

​

Specific

​

Loan

​

Specific

​

​

Balance (1)

​

Allocations

​

Balance (1)

​

Allocations

Commercial real estate - owner occupied

​

$

2,805

​

$

—

​

$

3,291

​

$

—

Commercial real estate - non-owner occupied

​

 

—

​

 

—

​

 

18,256

​

 

—

Secured by farmland

​

​

659

​

​

—

​

​

681

​

​

—

Construction and land development

​

 

—

​

 

—

​

 

4,575

​

 

—

Residential 1-4 family

​

​

9,244

​

​

—

​

​

541

​

​

—

Multi- family residential

​

​

10,516

​

​

—

​

​

5,378

​

​

—

Home equity lines of credit

​

​

23

​

​

—

​

​

—

​

​

—

Commercial loans

​

 

5,221

​

 

2,027

​

 

3,688

​

 

658

Consumer loans

​

​

32

​

​

19

​

​

7

​

​

1

Total non-PCD loans

​

​

28,500

​

​

2,046

​

​

36,417

​

​

659

PCD loans

​

​

6,843

​

​

2,126

​

​

8,455

​

​

2,281

Total loans

​

$

35,343

​

$

4,172

​

$

44,872

​

$

2,940

(1)Includes SBA guarantees of $0.7 million at June 30, 2022 and December 31, 2021.