⁽¹⁾	Includes $581 and $29,464 in U.S. Small Business Administration (“SBA”), paycheck protection program (“PPP”) loans at September 30, 2022 and December 31, 2021, respectively.

At September 30, 2022 and December 31, 2021, the unpaid principal balances of loans held for sale, included in the residential real estate category above, were $92 and $3,950, respectively.

The following tables present the classes of the loan portfolio summarized by the pass category and the criticized and classified categories of special mention and substandard within the internal risk system:


	September 30, 2022
	Pass		Special Mention		Substandard		Total
Commercial real estate:
Construction	$	13,293	$	—	$	—	$	13,293
Non-residential		253,992		7,961		3,109		265,062
Multifamily		67,327		—		—		67,327
Residential real estate		43,172		—		1,835		45,007
Commercial and industrial		77,692		4,000		950		82,642
Consumer:
Indirect automobile		452,227		—		592		452,819
Home equity		11,740		—		122		11,862
Other consumer		9,927		—		30		9,957
Total	$	929,370	$	11,961	$	6,638	$	947,969


	December 31, 2021
	Pass		Special Mention		Substandard		Total
Commercial real estate:
Construction	$	10,095	$	—	$	—	$	10,095
Non-residential		232,253		10,341		2,974		245,568
Multifamily		55,926		—		—		55,926
Residential real estate		33,416		—		2,230		35,646
Commercial and industrial		98,171		5,377		775		104,323
Consumer:
Indirect automobile		381,354		—		734		382,088
Home equity		11,587		—		270		11,857
Other consumer		7,908		—		47		7,955
Total	$	830,710	$	15,718	$	7,030	$	853,458

Management further monitors the performance and credit quality of the loan portfolio by analyzing the age of the portfolio as determined by the length of time a recorded payment is past due. The past due status of all classes of loans is determined based on contractual due dates for loan payments.

The following tables present the classes of the loan portfolio summarized by the aging categories of performing loans and non-accrual loans:


	September 30, 2022
							Greater Than
			30-59 Days		60-89 Days		90 Days Past		Total Loans
	Current		Past Due		Past Due		Due		Receivable		Non-accrual
Commercial real estate:
Construction	$	13,293	$	—	$	—	$	—	$	13,293	$	—
Non-residential		263,609		—		—		1,453		265,062		1,453
Multifamily		67,327		—		—		—		67,327		—
Residential real estate		43,254		1,160		—		593		45,007		1,835
Commercial and industrial		81,994		8		—		640		82,642		640
Consumer:
Indirect automobile		443,282		7,690		1,315		532		452,819		592
Home equity		11,612		78		147		25		11,862		122
Other consumer		9,842		53		32		30		9,957		30
Total	$	934,213	$	8,989	$	1,494	$	3,273	$	947,969	$	4,672


	December 31, 2021
							Greater Than
			30-59 Days		60-89 Days		90 Days Past		Total Loans
	Current		Past Due		Past Due		Due		Receivable		Non-accrual
Commercial real estate:
Construction	$	10,095	$	—	$	—	$	—	$	10,095	$	—
Non-residential		242,205		115		527		2,721		245,568		2,721
Multifamily		55,926		—		—		—		55,926		—
Residential real estate		34,363		57		242		984		35,646		2,230
Commercial and industrial		103,517		246		—		560		104,323		687
Consumer:
Indirect automobile		374,729		5,977		715		667		382,088		734
Home equity		11,429		149		106		173		11,857		270
Other consumer		7,702		153		53		47		7,955		47
Total	$	839,966	$	6,697	$	1,643	$	5,152	$	853,458	$	6,689

The following tables summarize information regarding impaired loans by loan portfolio class:


	September 30, 2022
	Recorded		Unpaid Principal		Related		Average Recorded
	Investment		Balance		Allowance		Investment
With no related allowance recorded:
Commercial real estate:
Non-residential	$	1,453	$	2,493	$	—	$	2,302
Residential real estate		1,835		2,460		—		1,999
Commercial and industrial		191		247		—		435
Consumer:
Indirect automobile		340		407		—		330
Home equity		122		123		—		159
Other consumer		27		31		—		37
Total	$	3,968	$	5,761	$	—	$	5,262
With an allowance recorded:
Commercial and industrial	$	449	$	449	$	449	$	114
Consumer:
Indirect automobile		252		262		68		284
Other consumer		3		3		1		10
Total	$	704	$	714	$	518	$	408
Total:
Commercial real estate:
Non-residential	$	1,453	$	2,493	$	—	$	2,302
Residential real estate		1,835		2,460		—		1,999
Commercial and industrial		640		696		449		549
Consumer:
Indirect automobile		592		669		68		614
Home equity		122		123		—		159
Other consumer		30		34		1		47
Total	$	4,672	$	6,475	$	518	$	5,670


	December 31, 2021
	Recorded		Unpaid Principal		Related		Average Recorded
	Investment		Balance		Allowance		Investment
With no related allowance recorded:
Commercial real estate:
Non-residential	$	2,721	$	3,797	$	—	$	2,290
Residential real estate		2,230		2,786		—		2,459
Commercial and industrial		687		921		—		674
Consumer:
Indirect automobile		345		408		—		219
Home equity		270		276		—		338
Other consumer		47		48		—		50
Total	$	6,300	$	8,236	$	—	$	6,030
With an allowance recorded:
Commercial real estate:
Commercial and industrial	$	—	$	—	$	—	$	148
Consumer:
Indirect automobile		389		395		68		286
Total	$	389	$	395	$	68	$	434
Total:
Commercial real estate:
Non-residential	$	2,721	$	3,797	$	—	$	2,290
Residential real estate		2,230		2,786		—		2,459
Commercial and industrial		687		921		—		822
Consumer:
Indirect automobile		734		803		68		505
Home equity		270		276		—		338
Other consumer		47		48		—		50
Total	$	6,689	$	8,631	$	68	$	6,464

A loan is considered impaired when based on current information and events it is probable that the Company will be unable to collect all amounts due from the borrower in accordance with the contractual terms of the loan. Impaired loans include nonperforming loans and loans modified as TDRs. Loan modifications, which resulted in these loans being considered TDRs, are primarily in the form of rate concessions and extensions of maturity dates that are made specifically due to hardships experienced by the customer. The Company does not generally recognize interest income on a loan in an impaired status. At September 30, 2022 and December 31, 2021, respectively, three loans totaling $1,339 and $1,440, included in impaired loans, were identified as TDRs. There were no new TDRs in 2021 or the first nine months of 2022. At September 30, 2022 and December 31, 2021, all TDR loans were performing in accordance with their restructured terms. At September 30, 2022 and December 31, 2021, the Company had no commitments to advance additional funds to borrowers under TDR loans.

The Company has transferred a portion of its originated commercial real estate loans to participating lenders. The amounts transferred have been accounted for as sales and are therefore not included in the Company’s accompanying statements of financial condition. The Company and participating lenders share ratably in any gains or losses that may result from a borrower’s lack of compliance with the contractual terms of the loan. The Company continues to service the loans on behalf of the participating lenders and, as such, collects cash payments from the borrowers, remits payments to participating lenders and disburses required escrow funds to relevant parties. At September 30, 2022 and December 31, 2021, the Company was servicing loans for participants aggregating $7,622 and $3,962, respectively.

Residential mortgage and consumer loans secured by residential real estate properties for which formal foreclosure proceedings are in process totaled $637 and $935 at September 30, 2022 and December 31, 2021, respectively.

The Company services certain loans that it has sold without recourse to third parties. The aggregate balances of loans serviced for others were $306,824 and $314,953 as of September 30, 2022 and December 31, 2021, respectively.

The balances of capitalized servicing rights, included in other assets at September 30, 2022 and December 31, 2021, were $2,531 and $2,633, respectively. Fair value exceeds carrying value, and thus, no impairment charges related to servicing rights were recognized during the period ended September 30, 2022 or the year ended December 31, 2021.

The following tables summarize the segments of the loan portfolio and the allowance for loan losses, segregated into the amount required for loans individually evaluated for impairment and the amount required for loans collectively evaluated for impairment and the activity in the allowance for loan losses for the periods then ended:


	Commercial				Commercial
	Real Estate		Residential		and Industrial		Indirect		Consumer		Totals

	Three months ended September 30, 2022
Allowance for loan losses:
Beginning balance	$	3,440	$	59	$	859	$	3,738	$	73	$	8,169
(Credit to) provision for loan losses		(86)		26		344		238		23		545
Loans charged-off		—		—		(6)		(736)		(39)		(781)
Recoveries		117		1		—		430		11		559
Ending balance	$	3,471	$	86	$	1,197	$	3,670	$	68	$	8,492


	Commercial		Residential		Commercial
	Real Estate		Real Estate		and Industrial			Indirect	Consumer		Totals

	Three months ended September 30, 2021
Allowance for loan losses:
Beginning balance	$	4,833	$	120	$	759	$	4,071	$	343	$	10,126
(Credit to) provision for loan losses		(792)		(67)		491		(294)		(292)		(954)
Loans charged-off		—		—		(12)		(527)		(5)		(544)
Recoveries		—		—		1		390		15		406
Ending balance	$	4,041	$	53	$	1,239	$	3,640	$	61	$	9,034


	Commercial		Residential		Commercial
	Real Estate		Real Estate		and Industrial		Indirect		Consumer		Totals

	Nine months ended September 30, 2022

Allowance for loan losses:
Beginning balance	$	3,317	$	54	$	725	$	3,416	$	47	$	7,559
Provision for (credit to) loan losses		37		(79)		477		593		84		1,112
Loans charged-off		—		(44)		(6)		(1,790)		(100)		(1,940)
Recoveries		117		155		1		1,451		37		1,761
Ending balance	$	3,471	$	86	$	1,197	$	3,670	$	68	$	8,492
Ending balance:
Loans deemed impaired	$	—	$	—	$	449	$	68	$	1	$	518
Loans not deemed impaired	$	3,471	$	86	$	748	$	3,602	$	67	$	7,974
Loan receivables:
Ending balance	$	345,682	$	45,007	$	82,642	$	452,819	$	21,819	$	947,969
Ending balance:
Loans deemed impaired	$	1,453	$	1,835	$	640	$	592	$	152	$	4,672
Loans not deemed impaired	$	344,229	$	43,172	$	82,002	$	452,227	$	21,667	$	943,297


	Commercial		Residential		Commercial
	Real Estate		Real Estate		and Industrial			Indirect	Consumer		Totals

	Nine months ended September 30, 2021
Allowance for loan losses:
Beginning balance	$	5,354	$	117	$	1,050	$	4,974	$	138	$	11,633
(Credit to) provision for loan losses		(1,313)		(67)		113		(803)		(101)		(2,171)
Loans charged-off		—		—		(13)		(1,644)		(14)		(1,671)
Recoveries		—		3		89		1,113		38		1,243
Ending balance	$	4,041	$	53	$	1,239	$	3,640	$	61	$	9,034
Ending balance:
Loans deemed impaired	$	—	$	—	$	—	$	68	$	—	$	68
Loans not deemed impaired	$	4,041	$	53	$	1,239	$	3,572	$	61	$	8,966
Loan receivables:
Ending balance	$	283,155	$	35,830	$	117,755	$	377,116	$	20,493	$	834,349
Ending balance:
Loans deemed impaired	$	2,088	$	2,483	$	884	$	477	$	271	$	6,203
Loans not deemed impaired	$	281,067	$	33,347	$	116,871	$	376,639	$	20,222	$	828,146


	Commercial		Residential		Commercial
	Real Estate		Real Estate		and Industrial		Indirect		Consumer		Totals

	December 31, 2021
Allowance for loan losses:
Ending balance:
Loans deemed impaired	$	—	$	—	$	—	$	68	$	—	$	68
Loans not deemed impaired	$	3,317	$	54	$	725	$	3,348	$	47	$	7,491
Loan receivables:
Ending balance	$	311,589	$	35,646	$	104,323	$	382,088	$	19,812	$	853,458
Ending balance:
Loans deemed impaired	$	2,721	$	2,230	$	687	$	734	$	317	$	6,689
Loans not deemed impaired	$	308,868	$	33,416	$	103,636	$	381,354	$	19,495	$	846,769

In the normal course of business, the Company grants loans to officers, directors and other related parties. Balances and activity of such loans during the periods presented were not material.