Allowance for Credit Losses (Tables)

12 Months Ended

Dec. 31, 2023

Allowance for Loan Losses [Abstract]

Summary of Transactions in Allowance for Loan Losses

A summary of the transactions in the allowance for credit losses for the years ended December 31, 2023 and 2022 appears below:

(Dollars in thousands)	2023			2022
Balance, beginning of period	$	5,552		$	5,984
Impact of ASC 326 adoption	$	2,491		$	—
Loans charged off		(721	)		(1,255	)
Recoveries		377			717
Net charge-offs		(344	)		(538	)
Provision for credit losses		696			106
Balance, December 31	$	8,395		$	5,552

Summary of Transactions in Allowance for Loan Losses by Major Loan Portfolio Segment

The following table shows the ACL activity by loan portfolio for the twelve months ended December 31, 2023:

(Dollars in thousands)	Commercial Loans			Real Estate Construction and Land			1-4 Family Residential Mortgages			Real Estate Mortgages		Consumer Loans			Total
Balance as of December 31, 2022	$	194		$	221		$	1,618		$	2,820	$	699		$	5,552
Impact of ASC 326 adoption		(11	)		440			14			1,577		471			2,491
Charge-offs		-			-			-			-		(721	)		(721	)
Recoveries		168			-			10			42		157			377
Provision for (recovery of) credit losses		(158	)		(199	)		(150	)		822		381			696
Balance as of December 31, 2023	$	193		$	462		$	1,492		$	5,261	$	987		$	8,395

The following table presents the changes in the ALLL by major classification during the year ended December 31, 2022:

(Dollars in thousands)	Commercial Loans			Real Estate Construction and Land			1-4 Family Residential Mortgages		Real Estate Mortgages			Consumer Loans			Total
Balance as of December 31, 2021	$	252		$	399		$	1,207	$	3,271		$	855		$	5,984
Impact of ASC 326 adoption		-			-			-		-			-		$	—
Charge-offs		(600	)		-			-		-			(655	)	$	(1,255	)
Recoveries		519			9			7		4			178		$	717
Provision for (recovery of) credit losses		23			(187	)		404		(455	)		321		$	106
Balance as of December 31, 2022	$	194		$	221		$	1,618	$	2,820		$	699		$	5,552

Summary of Provision for Credit Losses

The following table presents a breakdown of the provision for credit losses for the periods indicated:

(Dollars in thousands)	December 31, 2023		December 31, 2022
Provision for loan losses	$	696	$	106
Provision for unfunded commitments		38		-
Total	$	734	$	106

Summary of Amortized Cost Basis of Collateral Dependent Loans Individually Evaluated to Determine Expected Credit Losses, and Related ACL Allocated to Loans

The following table presents the Company's amortized cost basis of collateral dependent loans, which are individually evaluated to determine expected credit losses, and the related ACL allocated to those loans as of December 31, 2023:

(Dollars in thousands)	Real Estate Secured Loans		Allowance for Credit Losses - Loans
Commercial real estate - non owner occupied	$	414	$	-
Residential 1-4 family real estate		1,438		4
Total	$	1,852	$	4

Summary of Credit Quality Indicators

The following table presents the Company's recorded investment in loans by credit quality indicators by year of origination as of December 31, 2023. Current period gross write-off amounts represent write-offs for twelve months ended December 31, 2023:

	Term Loans Amortized Cost Basis by Origination Year
(Dollars in thousands)	2023		2022		2021		2020		2019		Prior		Revolving Loans		Loans Converted to Term		Total
Commercial
Pass	$	85,529	$	12,344	$	2,712	$	4,989	$	7,121	$	16,873	$	21,806	$	112	$	151,486
Watch		-		41		-		-		-		-		-		-		41
Special Mention		-		-		-		-		-		79		8		-		87
Substandard		-		97		1		135		53		212		50		355		903
Total commercial	$	85,529	$	12,482	$	2,713	$	5,124	$	7,174	$	17,164	$	21,864	$	467	$	152,517
Current period gross write-off	$	-	$	-	$	-	$	-	$	-	$	-	$	-	$	-	$	-
Real estate construction and land
Pass	$	12,425	$	11,748	$	3,683	$	1,717	$	955	$	1,293	$	129	$	-	$	31,950
Watch		-		-		-		-		-		299		-		-		299
Special Mention		-		-		-		-		-		37		-		-		37
Substandard		1,351		-		-		-		-		45		-		-		1,396
Total real estate construction and land	$	13,776	$	11,748	$	3,683	$	1,717	$	955	$	1,674	$	129	$	-	$	33,682
Current period gross write-off	$	-	$	-	$	-	$	-	$	-	$	-	$	-	$	-	$	-
1-4 family residential mortgages
Pass	$	19,482	$	14,712	$	54,066	$	74,539	$	24,999	$	85,836	$	20,571	$	524	$	294,729
Watch		-		1,621		1,874		602		-		7,149		1,166		-		12,412
Special Mention		-		1,089		1,458		1,958		270		1,591		78		138		6,582
Substandard		-		-		55		1,194		97		2,094		395		-		3,835
Total 1-4 family residential mortgage	$	19,482	$	17,422	$	57,453	$	78,293	$	25,366	$	96,670	$	22,210	$	662	$	317,558
Current period gross write-off	$	-	$	-	$	-	$	-	$	-	$	-	$	-	$	-	$	-
Commercial mortgages
Pass	$	112,093	$	41,433	$	46,315	$	101,205	$	45,809	$	171,184	$	1,502	$	76	$	519,617
Watch		-		-		1,196		166		165		14,188		-		-		15,715
Special Mention		-		-		391		278		-		4,130		-		-		4,799
Substandard		150		-		1,824		3,032		-		5,730		-		-		10,736
Total commercial mortgages	$	112,243	$	41,433	$	49,726	$	104,681	$	45,974	$	195,232	$	1,502	$	76	$	550,867
Current period gross write-off	$	-	$	-	$	-	$	-	$	-	$	-	$	-	$	-	$	-
Consumer
Pass	$	1,149	$	193	$	420	$	273	$	107	$	20,836	$	14,710			$	37,688
Watch		-		-		7		-		9		190		-				206
Special Mention		-		-		-		-		-		132		1		5		138
Substandard		1		-		-		-		8		-		-				9
Total consumer	$	1,150	$	193	$	427	$	273	$	124	$	21,158	$	14,711	$	5	$	38,041
Current period gross write-off	$	-	$	-	$	19	$	16	$	28	$	654	$	4	$	-	$	721

The following represents the loan portfolio designated by the internal risk ratings assigned to each credit as of December 31, 2022. There were no loans rated “Doubtful” as December 31, 2022.

December 31, 2022	Excellent		Good		Pass		Watch		Special Mention		Sub- standard		TOTAL
(Dollars in thousands)
Commercial	$	30,121	$	16,058	$	22,853	$	992	$	122	$	993	$	71,139
Real estate construction and land		-		-		35,258		342		532		1,409		37,541
1-4 family residential mortgages		-		-		308,041		7,935		5,431		1,778		323,185
Commercial mortgages		-		-		408,513		34,828		3,872		11,912		459,125
Consumer		461		17,544		26,326		977		22		95		45,425
Total Loans	$	30,582	$	33,602	$	800,991	$	45,074	$	9,979	$	16,187	$	936,415