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Loans and Allowance for Loan Losses
 12 Months Ended
Dec. 31, 2021
Loans and Allowance for Loan Losses [Abstract]  
Loans and Allowance for Loan Losses
(4)
Loans and Allowance for Loan Losses


The following tables present the recorded investment in loans by loan class:

 
  
December 31, 2021
  
(dollars in thousands)
  
New York and
other states*
    
Florida
    
Total
  
Commercial:
  
 
    
 
    
 
  
Commercial real estate
  
$
147,063
      
21,653
      
168,716
  
Other
    
30,889
      
595
      
31,484
  
Real estate mortgage - 1 to 4 family:
    
 
      
 
      
 
  
First mortgages
    
2,723,734
      
1,212,568
      
3,936,302
  
Home equity loans
    
48,190
      
13,695
      
61,885
  
Home equity lines of credit
    
175,134
      
55,842
      
230,976
  
Installment
    
7,368
      
2,048
      
9,416
  
Total loans, net
  
$
3,132,378
      
1,306,401
      
4,438,779
  
Less: Allowance for loan losses
    
 
      
 
      
44,267
  
Net loans
    
 
      
 
    
$
4,394,512
  

 
  
December 31, 2020
  
(dollars in thousands)
  
New York and
other states*
    
Florida
    
Total
  
Commercial:
  
 
    
 
    
 
  
Commercial real estate
  
$
148,775
      
18,666
      
167,441
  
Other
    
44,932
      
119
      
45,051
  
Real estate mortgage - 1 to 4 family:
    
 
      
 
      
 
  
First mortgages
    
2,606,781
      
1,098,915
      
3,705,696
  
Home equity loans
    
59,400
      
15,071
      
74,471
  
Home equity lines of credit
    
193,654
      
48,540
      
242,194
  
Installment
    
7,810
      
1,807
      
9,617
  
Total loans, net
  
$
3,061,352
      
1,183,118
      
4,244,470
  
Less: Allowance for loan losses
    
 
      
 
      
49,595
  
Net loans
    
 
      
 
    
$
4,194,875
  

* Includes New York, New Jersey, Vermont and Massachusetts.


As December 31, 2021 and 2020, the commercial loan class included $10 million and $29 million, respectively, of PPP loans.


At December 31, 2021 and 2020, the Company had approximately $37.3 million and $24.7 million of real estate construction loans, respectively. Of the $37.3 million in real estate construction loans at December 31, 2021, approximately $17.9 million were secured by first mortgages to residential borrowers with the remaining $19.4 million were to commercial borrowers for residential construction projects. Of the $24.7 million in real estate construction loans at December 31, 2020, approximately $10.5 million were secured by first mortgages to residential borrowers with the remaining $14.2 million were to commercial borrowers for residential construction projects.  The vast majority of construction loans are in the Company’s Florida market.


At December 31, 2021 and 2020, loans to executive officers, directors, and to associates of such persons aggregated $17.9 million and $16.3 million, respectively.  During 2021, approximately $8.6 million of new loans were made and repayments of loans totaled approximately $7.0 million.  The composition of the related parties’ loan balances had no changes during the year. All loans are current according to their term.


TrustCo lends in the geographic territory of its branch locations in New York, Florida, Massachusetts, New Jersey and Vermont.  Although the loan portfolio is diversified, a portion of its debtors’ ability to repay depends significantly on the economic conditions prevailing in the respective geographic territory.



The following tables present the recorded investment in non-accrual loans by loan class:

 
  
December 31, 2021
  
(dollars in thousands)
  
New York and
other states*
    
Florida
    
Total
  
Loans in non-accrual status:
                  
Commercial:
                  
Commercial real estate
  
$
67
      
-
      
67
  
Other
    
45
      
-
      
45
  
Real estate mortgage - 1 to 4 family:
                        
First mortgages
    
13,990
      
1,797
      
15,787
  
Home equity loans
    
247
      
45
      
292
  
Home equity lines of credit
    
2,337
      
174
      
2,511
  
Installment
    
23
      
14
      
37
  
Total non-accrual loans
    
16,709
      
2,030
      
18,739
  
Restructured real estate mortgages - 1 to 4 family
    
17
      
-
      
17
  
Total nonperforming loans
  
$
16,726
      
2,030
      
18,756
  

 
  
December 31, 2020
  
(dollars in thousands)
  
New York and
other states*
    
Florida
    
Total
  
Loans in non-accrual status:
                  
Commercial:
                  
Commercial real estate
  
$
372
      
-
      
372
  
Other
    
80
      
-
      
80
  
Real estate mortgage - 1 to 4 family:
                        
First mortgages
    
16,637
      
1,010
      
17,647
  
Home equity loans
    
80
      
47
      
127
  
Home equity lines of credit
    
2,662
      
130
      
2,792
  
Installment
    
43
      
-
      
43
  
Total non-accrual loans
    
19,874
      
1,187
      
21,061
  
Restructured real estate mortgages - 1 to 4 family
    
23
      
-
      
23
  
Total nonperforming loans
  
$
19,897
      
1,187
      
21,084
  

* Includes New York, New Jersey, Vermont and Massachusetts.



The Company transfers loans to other real estate owned, at fair value less cost to sell, in the period the Company obtains physical possession of the property (through legal title or through a deed in lieu).  As of December 31, 2021 and 2020, other real estate owned included $362 thousand and $541 thousand, respectively, of residential foreclosed properties.  In addition, non‑accrual residential mortgage loans that are in the process of foreclosure had a recorded investment of $9.7 million and $11.6 million as of December 31, 2021 and 2020, respectively.



The following tables present the aging of the recorded investment in past due loans by loan class and by region as of December 31, 2021 and 2020:

 
  
December 31, 2021
  
 
                                    
New York and other states*:
  
30-59
Days
    
60-89
Days
    
90 +
Days
    
Total
30+ days
          
Total
  
(dollars in thousands)
  
Past Due
    
Past Due
    
Past Due
    
Past Due
    
Current
    
Loans
  
 
                                    
Commercial:
                                    
Commercial real estate
  
$
-
      
233
      
45
      
278
      
146,785
      
147,063
  
Other
    
-
      
-
      
-
      
-
      
30,889
      
30,889
  
Real estate mortgage - 1 to 4 family:
                                                
First mortgages
    
1,303
      
239
      
9,867
      
11,409
      
2,712,325
      
2,723,734
  
Home equity loans
    
136
      
-
      
224
      
360
      
47,830
      
48,190
  
Home equity lines of credit
    
355
      
458
      
911
      
1,724
      
173,410
      
175,134
  
Installment
    
27
      
5
      
4
      
36
      
7,332
      
7,368
  
 
                                                
Total
  
$
1,821
      
935
      
11,051
      
13,807
      
3,118,571
      
3,132,378
  

Florida:
  
30-59
Days
    
60-89
Days
    
90 +
Days
    
Total
30+ days
          
Total
  
(dollars in thousands)
  
Past Due
    
Past Due
    
Past Due
    
Past Due
    
Current
    
Loans
  
 
                                    
Commercial:
                                    
Commercial real estate
  
$
-
      
-
      
-
      
-
      
21,653
      
21,653
  
Other
    
-
      
-
      
-
      
-
      
595
      
595
  
Real estate mortgage - 1 to 4 family:
                                                
First mortgages
    
869
      
180
      
1,146
      
2,195
      
1,210,373
      
1,212,568
  
Home equity loans
    
-
      
45
      
-
      
45
      
13,650
      
13,695
  
Home equity lines of credit
    
-
      
89
      
-
      
89
      
55,753
      
55,842
  
Installment
    
18
      
-
      
5
      
23
      
2,025
      
2,048
  
 
                                                
Total
  
$
887
      
314
      
1,151
      
2,352
      
1,304,049
      
1,306,401
  

Total:
  
30-59
Days
    
60-89
Days
    
90 +
Days
    
Total
30+ days
          
Total
  
(dollars in thousands)
  
Past Due
    
Past Due
    
Past Due
    
Past Due
    
Current
    
Loans
  
 
                                    
Commercial:
                                    
Commercial real estate
  
$
-
      
233
      
45
      
278
      
168,438
      
168,716
  
Other
    
-
      
-
      
-
      
-
      
31,484
      
31,484
  
Real estate mortgage - 1 to 4 family:
                                                
First mortgages
    
2,172
      
419
      
11,013
      
13,604
      
3,922,698
      
3,936,302
  
Home equity loans
    
136
      
45
      
224
      
405
      
61,480
      
61,885
  
Home equity lines of credit
    
355
      
547
      
911
      
1,813
      
229,163
      
230,976
  
Installment
    
45
      
5
      
9
      
59
      
9,357
      
9,416
  
 
                                                
Total
  
$
2,708
      
1,249
      
12,202
      
16,159
      
4,422,620
      
4,438,779
  

* Includes New York, New Jersey, Vermont and Massachusetts.


  
December 31, 2020
  
 
                                    
New York and other states*:
  
30-59
Days
    
60-89
Days
    
90 +
Days
    
Total
30+ days
          
Total
  
(dollars in thousands)
  
Past Due
    
Past Due
    
Past Due
    
Past Due
    
Current
    
Loans
  
 
                                    
Commercial:
                                    
Commercial real estate
  
$
125
      
77
      
279
      
481
      
146,582
      
147,063
  
Other
    
-
      
-
      
80
      
80
      
44,852
      
44,932
  
Real estate mortgage - 1 to 4 family:
                                                
First mortgages
    
1,220
      
982
      
10,927
      
13,129
      
2,593,652
      
2,606,781
  
Home equity loans
    
120
      
1
      
48
      
169
      
59,231
      
59,400
  
Home equity lines of credit
    
401
      
344
      
1,273
      
2,018
      
191,636
      
193,654
  
Installment
    
3
      
-
      
43
      
46
      
7,764
      
7,810
  
 
                                                
Total
  
$
1,869
      
1,404
      
12,650
      
15,923
      
3,045,429
      
3,061,352
  

Florida:
  
30-59
Days
    
60-89
Days
    
90 +
Days
    
Total
30+ days
          
Total
  
(dollars in thousands)
  
Past Due
    
Past Due
    
Past Due
    
Past Due
    
Current
    
Loans
  
 
                                    
Commercial:
                                    
Commercial real estate
  
$
-
      
-
      
-
      
-
      
18,666
      
18,666
  
Other
    
-
      
-
      
-
      
-
      
119
      
119
  
Real estate mortgage - 1 to 4 family:
                                                
First mortgages
    
365
      
517
      
655
      
1,537
      
1,097,378
      
1,098,915
  
Home equity loans
    
-
      
-
      
47
      
47
      
15,024
      
15,071
  
Home equity lines of credit
    
-
      
-
      
-
      
-
      
48,540
      
48,540
  
Installment
    
7
      
10
      
-
      
17
      
1,790
      
1,807
  
 
                                                
Total
  
$
372
      
527
      
702
      
1,601
      
1,181,517
      
1,183,118
  

Total:
  
30-59
Days
    
60-89
Days
    
90 +
Days
    
Total
30+ days
          
Total
  
(dollars in thousands)
  
Past Due
    
Past Due
    
Past Due
    
Past Due
    
Current
    
Loans
  
 
                                    
Commercial:
                                    
Commercial real estate
  
$
125
      
77
      
279
      
481
      
166,960
      
167,441
  
Other
    
-
      
-
      
80
      
80
      
44,971
      
45,051
  
Real estate mortgage - 1 to 4 family:
                                                
First mortgages
    
1,585
      
1,499
      
11,582
      
14,666
      
3,691,030
      
3,705,696
  
Home equity loans
    
120
      
1
      
95
      
216
      
74,255
      
74,471
  
Home equity lines of credit
    
401
      
344
      
1,273
      
2,018
      
240,176
      
242,194
  
Installment
    
10
      
10
      
43
      
63
      
9,554
      
9,617
  
 
                                                
Total
  
$
2,241
      
1,931
      
13,352
      
17,524
      
4,226,946
      
4,244,470
  

* Includes New York, New Jersey, Vermont and Massachusetts.


At December 31, 2021 and 2020, there were no loans that are 90 days past due and still accruing interest.  As a result, non‑accrual loans includes all loans 90 days past due and greater as well as certain loans less than 90 days past due that were placed in non‑accruing status for reasons other than delinquent status.  There are no commitments to extend further credit on nonaccrual or restructured loans.



Activity in the allowance for loan losses by portfolio segment is summarized as follows:

 
For the year ended December 31, 2021
  
(dollars in thousands)
  
Commercial
    
Real Estate
Mortgage-
1 to 4 Family
    
Installment
    
Total
  
 
                        
Balance at beginning of period
  
$
4,140
      
44,950
      
505
      
49,595
  
Loans charged off:
                                
New York and other states*
    
30
      
339
      
58
      
427
  
Florida
    
-
      
1
      
2
      
3
  
Total loan chargeoffs
    
30
      
340
      
60
      
430
  
 
                                
Recoveries of loans previously charged off:
                                
New York and other states*
    
32
      
464
      
54
      
550
  
Florida
    
-
      
2
      
-
      
2
  
Total recoveries
    
32
      
466
      
54
      
552
  
Net loans charged off
    
(2
)
    
(126
)
    
6
      
(122
)
Credit for loan losses
    
(1,007
)
    
(4,387
)
    
(56
)
    
(5,450
)
Balance at end of period
  
$
3,135
      
40,689
      
443
      
44,267
  

 
  
For the year ended December 31, 2020
  
(dollars in thousands)
  
Commercial
    
Real Estate
Mortgage-
1 to 4 Family
    
Installment
    
Total
  
 
                        
Balance at beginning of period
  
$
3,999
      
39,748
      
570
      
44,317
  
Loans charged off:
                                
New York and other states*
    
36
      
404
      
187
      
627
  
Florida
    
-
      
-
      
34
      
34
  
Total loan chargeoffs
    
36
      
404
      
221
      
661
  
 
                                
Recoveries of loans previously charged off:
                                
New York and other states*
    
10
      
314
      
12
      
336
  
Florida
    
-
      
3
      
-
      
3
  
Total recoveries
    
10
      
317
      
12
      
339
  
Net loans charged off
    
26
   
87
      
209
      
322
  
Provision for loan losses
    
167
   
5,289
      
144
   
5,600
  
Balance at end of period
  
$
4,140
      
44,950
      
505
      
49,595
  


The following tables present the balance in the allowance for loan losses and the recorded investment in loans by portfolio segment and based on impairment method as of December 31, 2021 and 2020:

 
  
December 31, 2021
  
(dollars in thousands)
  
Commercial
Loans
    
1-to-4 Family
Residential
Real Estate
    
Installment
Loans
    
Total
  
 
                        
Allowance for loan losses:
                        
Ending allowance balance attributable to loans:
                        
Individually evaluated for impairment
  
$
-
      
-
      
-
      
-
  
Collectively evaluated for impairment
    
3,135
      
40,689
      
443
      
44,267
  
 
                                
Total ending allowance balance
  
$
3,135
      
40,689
      
443
      
44,267
  
 
                                
Loans:
                                
Individually evaluated for impairment
  
$
232
      
18,272
      
-
      
18,504
  
Collectively evaluated for impairment
    
199,968
      
4,210,891
      
9,416
      
4,420,275
  
 
                                
Total ending loans balance
  
$
200,200
      
4,229,163
      
9,416
      
4,438,779
  

 
  
December 31, 2020
  
(dollars in thousands)
  
Commercial
Loans
    
1-to-4 Family
Residential
Real Estate
    
Installment
Loans
    
Total
  
 
                        
Allowance for loan losses:
                        
Ending allowance balance attributable to loans:
                        
Individually evaluated for impairment
  
$
-
      
-
      
-
      
-
  
Collectively evaluated for impairment
    
4,140
      
44,950
      
505
      
49,595
  
 
                                
Total ending allowance balance
  
$
4,140
      
44,950
      
505
      
49,595
  
 
                                
Loans:
                                
Individually evaluated for impairment
  
$
1,028
      
20,553
      
-
      
21,581
  
Collectively evaluated for impairment
    
211,464
      
4,001,808
      
9,617
      
4,222,889
  
 
                                
Total ending loans balance
  
$
212,492
      
4,022,361
      
9,617
      
4,244,470
  


The Company has identified nonaccrual commercial and commercial real estate loans, as well as all loans restructured under a TDR, as impaired loans.  A loan is considered impaired when it is probable that the borrower will be unable to repay the loan according to the original contractual terms of the loan agreement or the loan is restructured in a TDR.


A loan for which the terms have been modified, and for which the borrower is experiencing financial difficulties, is considered a TDR and is classified as impaired.  TDR’s at December 31, 2021 and 2020 are measured at the present value of estimated future cash flows using the loan’s effective rate at inception or the fair value of the underlying collateral if the loan is considered collateral dependent.



The following tables present impaired loans by loan class as of December 31, 2021 and 2020:

 
  
December 31, 2021
  
New York and other states*:

(dollars in thousands)
  
Recorded
Investment
    
Unpaid
Principal
Balance
    
Related
Allowance
    
YTD Avg
Recorded
Investment
  
 
                        
Commercial:
                        
Commercial real estate
  
$
187
      
279
      
-
      
1,154
  
Other
    
45
      
45
      
-
      
107
  
Real estate mortgage - 1 to 4 family:
                                
First mortgages
    
13,687
      
13,875
      
-
      
14,072
  
Home equity loans
    
161
      
161
      
-
      
235
  
Home equity lines of credit
    
1,852
      
1,939
      
-
      
2,256
  
 
                                
Total
   $
15,932
      
16,299
      
-
      
17,824
  

Florida:

(dollars in thousands)
  
Recorded
Investment
    
Unpaid
Principal
Balance
    
Related
Allowance
    
YTD Avg
Recorded
Investment
  
 
                        
Commercial:
                        
Commercial real estate
   $
-
      
-
      
-
      
105
  
Other
    
-
      
-
      
-
      
-
  
Real estate mortgage - 1 to 4 family:
                                
First mortgages
    
2,368
      
2,368
      
-
      
2,562
  
Home equity loans
    
-
      
-
      
-
      
16
  
Home equity lines of credit
    
204
      
204
      
-
      
246
  
 
                                
Total
  
$
2,572
      
2,572
      
-
      
2,929
  

Total:

(dollars in thousands)
  
Recorded
Investment
    
Unpaid
Principal
Balance
    
Related
Allowance
    
YTD Avg
Recorded
Investment
  
 
                        
Commercial:
                        
Commercial real estate
  
$
187
      
279
      
-
      
1,259
  
Other
    
45
      
45
      
-
      
107
  
Real estate mortgage - 1 to 4 family:
                                
First mortgages
    
16,055
      
16,243
      
-
      
16,634
  
Home equity loans
    
161
      
161
      
-
      
251
  
Home equity lines of credit
    
2,056
      
2,143
      
-
      
2,502
  
 
                                
Total
  
$
18,504
      
18,871
      
-
      
20,753
  

* Includes New York, New Jersey, Vermont and Massachusetts.


 
  
December 31, 2020
  

                       
New York and other states*:

(dollars in thousands)
  
Recorded
Investment
    
Unpaid
Principal
Balance
    
Related
Allowance
    
YTD Avg
Recorded
Investment
  
 
                        
Commercial:
                        
Commercial real estate
  
$
819
      
943
      
-
      
1,186
  
Other
    
111
      
111
      
-
      
103
  
Real estate mortgage - 1 to 4 family:
                                
First mortgages
    
15,024
      
15,411
      
-
      
14,110
  
Home equity loans
    
219
      
240
      
-
      
235
  
Home equity lines of credit
    
2,158
      
2,298
      
-
      
2,258
  
 
                                
Total
  
$
18,331
      
19,003
      
-
      
17,892
  

Florida:

(dollars in thousands)
  
Recorded
Investment
    
Unpaid
Principal
Balance
    
Related
Allowance
    
YTD Avg
Recorded
Investment
  
 
                        
Commercial:
                        
Commercial real estate
  
$
98
      
98
      
-
      
105
  
Other
    
-
      
-
      
-
      
-
  
Real estate mortgage - 1 to 4 family:
                                
First mortgages
    
2,908
      
2,908
      
-
      
2,555
  
Home equity loans
    
-
      
-
      
-
      
16
  
Home equity lines of credit
    
244
      
244
      
-
      
246
  
 
                                
Total
  
$
3,250
      
3,250
      
-
      
2,922
  

Total:

(dollars in thousands)
  
Recorded
Investment
    
Unpaid
Principal
Balance
    
Related
Allowance
    
YTD Avg
Recorded
Investment
  
 
                        
Commercial:
                        
Commercial real estate
  
$
917
      
1,041
      
-
      
1,291
  
Other
    
111
      
111
      
-
      
103
  
Real estate mortgage - 1 to 4 family:
                                
First mortgages
    
17,932
      
18,319
      
-
      
16,665
  
Home equity loans
    
219
      
240
      
-
      
251
  
Home equity lines of credit
    
2,402
      
2,542
      
-
      
2,504
  
 
                                
Total
  
$
21,581
      
22,253
      
-
      
20,814
  

* Includes New York, New Jersey, Vermont and Massachusetts.


The Company has not committed to lend additional amounts to customers with outstanding loans that are classified as impaired.  Interest income recognized on impaired loans was not material in 2021, 2020, and 2019.


Included in impaired loans are approximately $10.7 million and $11.7 million of loans in accruing status that were identified as TDR’s as of December 31, 2021 and 2020, respectively.


Management evaluates impairment on impaired loans on a quarterly basis.  If, during this evaluation, impairment of the loan is identified, a charge‑off is taken at that time if necessary.  As a result, as of December 31, 2021 and 2020, based upon management’s evaluation and due to the sufficiency of charge‑offs taken, none of the allowance for loan losses has been allocated to a specific impaired loan(s).


The following table presents modified loans by class that were determined to be TDR’s that occurred during the years ended December 31, 2021, 2020 and 2019:

 
  
Year ended 12/31/21
    
Year ended 12/31/20
    
Year ended 12/31/19
  

                                                     
New York and
other states*:


(dollars in thousands)
  
Number of
Contracts
    
Pre-Modification
Outstanding
Recorded
Investment
    
Post-Modification
Outstanding
Recorded
Investment
    
Number of
Contracts
    
Pre-Modification
Outstanding
Recorded
Investment
    
Post-Modification
Outstanding
Recorded
Investment
    
Number of
Contracts
    
Pre-Modification
Outstanding
Recorded
Investment
    
Post-Modification
Outstanding
Recorded
Investment
  
 
                                                      
Commercial:
                                                      
Commercial real estate
    
-
    
$
-
      
-
      
1
    
$
125
      
125
      
1
    
$
125
      
125
  
Real estate mortgage - 1 to 4 family:
                                                                        
First mortgages
    
6
      
1,114
      
1,114
      
12
      
2,303
      
2,303
      
18
      
2,621
      
2,621
  
Home equity loans
    
1
      
2
      
2
      
-
      
-
      
-
      
-
      
-
      
-
  
Home equity lines of credit
    
2
      
40
      
40
      
3
      
169
      
169
      
2
      
235
      
235
  
 
                                                                        
Total
    
9
    
$
1,156
      
1,156
      
16
    
$
2,597
      
2,597
      
21
    
$
2,981
      
2,981
  

Florida:


(dollars in thousands)
  
Number of
Contracts
    
Pre-Modification
Outstanding
Recorded
Investment
    
Post-Modification
Outstanding
Recorded
Investment
    
Number of
Contracts
    
Pre-Modification
Outstanding
Recorded
Investment
    
Post-Modification
Outstanding
Recorded
Investment
    
Number of
Contracts
    
Pre-Modification
Outstanding
Recorded
Investment
    
Post-Modification
Outstanding
Recorded
Investment
  
 
                                                      
Real estate mortgage - 1 to 4 family:
                                                      
First mortgages
    
1
    
$
77
      
77
      
4
    
$
586
      
586
      
6
    
$
632
      
632
  
Home equity loans
    
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
  
Home equity lines of credit
    
1
      
50
      
50
      
-
      
-
      
-
      
-
      
-
      
-
  
 
                                                                        
Total
    
2
    
$
127
      
127
      
4
    
$
586
      
586
      
6
    
$
632
      
632
  

* Includes New York, New Jersey, Vermont and Massachusetts.


The addition of these TDR’s did not have a significant impact on the allowance for loan losses.


The following table presents loans by class modified as TDR’s that occurred during the years ended December 31, 2021, 2020 and 2019 for which there was a payment default within 12 months of modification:

 
  
Year ended 12/31/21
    
Year ended 12/31/20
    
Year ended 12/31/19
  
New York and other states*:
(dollars in thousands)
  
Number of
Contracts
    
Recorded
Investment
    
Number of
Contracts
    
Recorded
Investment
    
Number of
Contracts
    
Recorded
Investment
  
 
                                    
Real estate mortgage - 1 to 4 family:
                                    
First mortgages
    
-
    
$
-
      
4
    
$
457
      
2
    
$
418
  
Home equity loans
    
-
      
-
      
1
      
19
      
-
      
-
  
Home equity lines of credit
    
1
      
56
      
-
      
-
      
-
      
-
  
 
                                                
Total
    
1
    
$
56
      
5
    
$
476
      
2
    
$
418
  

Florida:
(dollars in thousands)
  
Number of
Contracts
    
Recorded
Investment
    
Number of
Contracts
    
Recorded
Investment
    
Number of
Contracts
    
Recorded
Investment
  
 
                                    
Real estate mortgage - 1 to 4 family:
                                    
First mortgages
    
-
    
$
-
      
-
    
$
-
      
-
    
$
-
  
Home equity lines of credit
    
-
      
-
      
-
      
-
      
-
      
-
  
 
                                                
Total
    
-
    
$
-
      
-
    
$
-
      
-
    
$
-
  

* Includes New York, New Jersey, Vermont and Massachusetts.



In situations where the Bank considers a loan modification, management determines whether the borrower is experiencing financial difficulty by performing an evaluation of the probability that the borrower will be in payment default on any of its debt in the foreseeable future without the modification.  This evaluation is performed under the Company’s underwriting policy.  Generally, the modification of the terms of loans was the result of the borrower filing for bankruptcy protection.  Chapter 13 bankruptcies generally include the deferral of all past due amounts for a period of generally 60 months in accordance with the bankruptcy court order.  In the case of Chapter 7 bankruptcies, even though there is no modification of terms, the borrowers’ debt to the Company was discharged and they may not reaffirm the debt.


A loan is considered to be in payment default once it is 90 days contractually past due under the modified terms.  In situations involving a borrower filing for Chapter 13 bankruptcy protection, however, a loan is considered to be in payment default once it is 30 days contractually past due, consistent with the treatment by the bankruptcy court.


The TDR’s that subsequently defaulted described above did not have a material impact on the allowance for loan losses as the underlying collateral was evaluated at the time these loans were identified as TDR’s, and a charge‑off was taken at that time, if necessary.  Collateral values on these loans are reviewed for collateral sufficiency on a quarterly basis.


As noted above, loan modifications and payment deferrals as a result of COVID-19 that meet the criteria established under Section 4013 of the CARES Act or under applicable interagency guidance of the federal banking regulators were excluded from evaluation of TDR classification and were reported as current during the payment deferral period. The Company’s policy is to continue to accrue interest during the deferral period. Loans not meeting the CARES ACT or regulatory guidance are evaluated for TDR and non-accrual treatment under the Company’s existing policies and procedures.  There was no loan modifications made pursuant to the CARES ACT that were in payment deferral at December 31, 2021. As of December 31, 2020 there was $2 million of residential loan deferrals. There were no commercial or installment loan deferrals as of December 31, 2021 and 2020.


The Company categorizes non-homogenous loans such as commercial and commercial real estate loans into risk categories based on relevant information about the ability of borrowers to service their debt, such as: current financial information, historical payment experience, credit documentation, public information, and current economic trends, among other factors.  On at least an annual basis, in accordance with the Company’s Loan Policy, the Company analyzes non-homogeneous loans, individually by grading the loans based on credit risk.  The loan grades assigned to all loan types are also tested by the Company’s external loan review firm in accordance with the Company’s loan review policy.


The Company uses the following definitions for classified loans:

Special Mention: Loans classified as special mention have a potential weakness that deserves management’s close attention.  If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or of the Company’s credit position at some future date.

Substandard: Loans classified as substandard are 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 Company will sustain some loss if the deficiencies are not corrected.

Doubtful: Loans classified as doubtful have all the weaknesses inherent in those loans 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.  All doubtful loans are considered impaired.


Loans not meeting the criteria above that are analyzed individually as part of the above-described process are considered to be pass rated loans.



As of December 31, 2021 and 2020, and based on the most recent analysis performed, the risk category of loans by class of loans is as follows:

 
  
December 31, 2021
  
New York and other states*:
(dollars in thousands)
  
Pass
    
Classified
    
Total
  
 
                  
Commercial:
                  
Commercial real estate
  
$
145,500
      
1,563
      
147,063
  
Other
    
30,726
      
163
      
30,889
  
 
  
$
176,226
      
1,726
      
177,952
  

Florida:
(dollars in thousands)
  
Pass
    
Classified
    
Total
  
 
                  
Commercial:
                  
Commercial real estate
  
$
21,113
      
540
      
21,653
  
Other
    
595
      
-
      
595
  
 
  
$
21,708
      
540
      
22,248
  

Total:
(dollars in thousands)
  
Pass
    
Classified
    
Total
  
 
                  
Commercial:
                  
Commercial real estate
  
$
166,613
      
2,103
      
168,716
  
Other
    
31,321
      
163
      
31,484
  
   
$
197,934
      
2,266
      
200,200
  

* Includes New York, New Jersey and Massachusetts.

 
  
December 31, 2020
  
New York and other states*:
(dollars in thousands)
  
Pass
    
Classified
    
Total
  
 
                  
Commercial:
                  
Commercial real estate
  
$
145,741
      
3,034
      
148,775
  
Other
    
44,522
      
410
      
44,932
  
 
  
$
190,263
      
3,444
      
193,707
  

Florida:
(dollars in thousands)
  
Pass
    
Classified
    
Total
  
 
                  
Commercial:
                  
Commercial real estate
  
$
18,092
      
574
      
18,666
  
Other
    
119
      
-
      
119
  
 
  
$
18,211
      
574
      
18,785
  

Total:
(dollars in thousands)
  
Pass
    
Classified
    
Total
  
 
                  
Commercial:
                  
Commercial real estate
  
$
163,833
      
3,608
      
167,441
  
Other
    
44,641
      
410
      
45,051
  
   
$
208,474
      
4,018
      
212,492
  

* Includes New York, New Jersey and Massachusetts.


Included in classified loans in the above tables are impaired loans of $226 thousand and $796 thousand at December 31, 2021 and 2020, respectively.


For homogeneous loan pools, such as residential mortgages, home equity lines of credit, and installment loans, the Company uses payment status to identify the credit risk in these loan portfolios.  Payment status is reviewed on a daily basis by the Bank’s collection area and on a monthly basis with respect to determining the adequacy of the allowance for loan losses.  The payment status of these homogeneous pools at December 31, 2021 and 2020 is included in the aging of the recorded investment of past due loans table.  In addition, the total nonperforming portion of these homogeneous loan pools at December 31, 2021 and 2020 is presented in the recorded investment in non-accrual loans table.


In 2020, the company granted 663 PPP loans totaling $46 million of which 514 PPP loans totaling $29 million remained outstanding as of December 31, 2020. In 2021 the bank granted an additional 344 PPP loans totaling $23 million and as of December 31, 2021, 190 PPP loans totaling $10 million remain outstanding.