Off-Balance-Sheet Credit Risk: The commitments and contingent liabilities include various commitments to extend credit and standby letters of credit, which arise in the normal course of business. Commitments to extend credit are legally binding loan commitments with set expiration dates. Standby letters of credit are conditional commitments issued by the Company to guarantee the performance of a customer to a third party. They are intended to be disbursed, subject to certain conditions, upon request of the borrower.

The Company evaluates the creditworthiness of each customer. Collateral, if deemed necessary by the Company upon the extension of credit, is obtained based on management’s evaluation of the borrower. Collateral for commercial and industrial loans may vary, but may include securities, accounts receivable, inventory, property, plant and equipment, and income producing commercial or other properties.

The following table shows the distribution of undisbursed loan commitments as of the dates indicated:

	December 31, 2020		December 31, 2019
	(Dollars in thousands)
Commitments to extend credit	$	75,740	$	66,153
Standby letter of credit		9,212		7,377
Commercial letter of credit		1,552		1,111
Total undisbursed loan commitments	$	86,504	$	74,641

The majority of these off-balance sheet commitments have a variable interest rate. Management does not anticipate any material losses as a result of these transactions.

Investments in low income housing partnership: The Company invests in qualified affordable housing partnerships. The following table shows the balance of the investments in low income housing partnerships and the total unfunded commitments related to the investments in low income housing partnerships as of the dates indicated:

	December 31, 2020		December 31, 2019
	(Dollars in thousands)
Investments in low income housing partnerships	$	4,932	$	1,719
Unfunded commitments to fund investments for low income housing partnerships		2,154		70

These balances are reflected in the other assets and other liabilities lines on the Consolidated Balance Sheets. The Company expects to finish fulfilling these commitments during the year ending 2034.

The Company recognized amortization expense of $262,000, $222,000 and $226,000, for the years ended December 31, 2020, 2019 and 2018, respectively, which was included within income tax expense on the Consolidated Statements of Income. Additionally, the Company recognized tax credits and other benefits from the investments in low income housing partnerships of $251,000, 199,000 and $203,000, for the years ended December 31, 2020, 2019 and 2018, respectively.