Loans

9 Months Ended

Sep. 30, 2021

Loans:

Acquired loans were transferred and are included in originated loans at period ended September 30, 2021. This is to align with the calculation of the allowance for credit losses being used under the CECL model. Loan balances were as follows:

(In Thousands of Dollars)	September 30, 2021			December 31, 2020
Originated loans:
Commercial real estate
Owner occupied	$	260,556		$	215,187
Non-owner occupied		351,407			309,777
Farmland		176,190			156,277
Other		78,444			78,140
Commercial
Commercial and industrial		302,356			385,831
Agricultural		50,707			44,922
Residential real estate
1-4 family residential		376,901			324,723
Home equity lines of credit		106,750			92,968
Consumer
Indirect		158,617			164,620
Direct		21,520			23,348
Other		9,359			9,868
Total originated loans	$	1,892,807		$	1,805,661
Acquired loans:
Commercial real estate
Owner occupied	$	0		$	45,101
Non-owner occupied		0			52,863
Farmland		0			26,080
Other		0			12,868
Commercial
Commercial and industrial		0			18,662
Agricultural		0			4,850
Residential real estate
1-4 family residential		0			89,118
Home equity lines of credit		0			17,383
Consumer
Direct		0			5,128
Other		0			97
Total acquired loans	$	0		$	272,150
Net Deferred loan (fees) costs		1,409			233
Allowance for credit losses		(23,136	)		(22,144	)
Net loans	$	1,871,080		$	2,055,900

Allowance for credit loss activity

The following tables present the activity in the allowance for credit losses by portfolio segment for the three and nine month periods ended September 30, 2021 and the activity in the allowance for loan losses by portfolio segment for the three and nine month periods ended September 30, 2020:

Three Months Ended September 30, 2021

(In Thousands of Dollars)	Commercial Real Estate			Commercial			Residential Real Estate			Consumer			Total
Allowance for credit losses
Beginning balance	$	12,290		$	4,600		$	4,130		$	3,786		$	24,806
Adjustment related to reserve for unfunded loan reclass	$	(245	)	$	(104	)	$	(73	)	$	(15	)		(437	)
Provision for credit losses		(454	)		(655	)		75			87			(947	)
Loans charged off		(31	)		(126	)		(55	)		(199	)		(411	)
Recoveries		1			15			41			68			125
Total ending allowance balance	$	11,561		$	3,730		$	4,118		$	3,727		$	23,136

Nine Months Ended September 30, 2021

(In Thousands of Dollars)	Commercial Real Estate			Commercial			Residential Real Estate			Consumer			Total
Allowance for credit losses
Beginning balance	$	10,824		$	5,073		$	3,643		$	2,604		$	22,144
Adjustment related to reserve for unfunded loan reclass		(245	)		(104	)		(73	)		(15	)		(437	)
Impact of CECL adoption		(2,076	)		429			237			3,860			2,450
Provision for credit losses		3,077			(1,668	)		411			(2,292	)		(472	)
Loans charged off		(51	)		(198	)		(221	)		(727	)		(1,197	)
Recoveries		32			198			121			297			648
Total ending allowance balance	$	11,561		$	3,730		$	4,118		$	3,727		$	23,136

Three Months Ended September 30, 2020

(In Thousands of Dollars)	Commercial Real Estate			Commercial			Residential Real Estate			Consumer			Total
Allowance for credit losses
Beginning balance	$	7,972		$	3,293		$	2,991		$	2,704		$	16,960
Provision for credit losses		1,052			1,090			414			44			2,600
Loans charged off		(20	)		(92	)		(22	)		(259	)		(393	)
Recoveries		2			1			14			157			174
Total ending allowance balance	$	9,006		$	4,292		$	3,397		$	2,646		$	19,341

Nine Months Ended September 30, 2020

(In Thousands of Dollars)	Commercial Real Estate			Commercial			Residential Real Estate			Consumer			Total
Allowance for credit losses
Beginning balance	$	6,156		$	2,447		$	3,029		$	2,855		$	14,487
Provision for credit losses		2,961			2,176			490			473			6,100
Loans charged off		(117	)		(340	)		(163	)		(1,046	)		(1,666	)
Recoveries		6			9			41			364			420
Total ending allowance balance	$	9,006		$	4,292		$	3,397		$	2,646		$	19,341

The following table presents the recorded investment in nonaccrual and loans past due 90 days or more still on accrual by class of loans as of September 30, 2021 and December 31, 2020:

	September 30, 2021				December 31, 2020
(In Thousands of Dollars)	Nonaccrual		Loans Past Due 90 Days or More Still Accruing		Nonaccrual		Loans Past Due 90 Days or More Still Accruing
Originated loans:
Commercial real estate
Owner occupied	$	452	$	0	$	0	$	335
Non-owner occupied		2,627		0		0		0
Farmland		277		0		0		0
Commercial
Commercial and industrial		5,177		3		3,312		22
Agricultural		34		0		205		0
Residential real estate
1-4 family residential		3,960		466		866		223
Home equity lines of credit		718		137		603		0
Consumer
Indirect		462		101		648		64
Direct		261		69		157		111
Other		0		0		1		5
Total originated loans	$	13,968	$	776	$	5,792	$	760
Acquired loans:
Commercial real estate
Owner occupied	$	0	$	0	$	27	$	0
Non-owner occupied		0		0		362		0
Farmland		0		0		471		95
Commercial
Commercial and industrial		0		0		477		0
Agricultural		0		0		4		0
Residential real estate
1-4 family residential		0		0		4,128		1,469
Home equity lines of credit		0		0		186		0
Consumer
Direct		0		0		58		6
Total acquired loans	$	0	$	0	$	5,713	$	1,570
Total loans	$	13,968	$	776	$	11,505	$	2,330

The following tables present the aging of the recorded investment in past due loans as of September 30, 2021 and December 31, 2020 by class of loans. Note that loans on a current modification to defer payments under the CARES Act are included in loans not past due.

(In Thousands of Dollars)	30-59 Days Past Due		60-89 Days Past Due		90 Days or More Past Due and Nonaccrual		Total Past Due		Loans Not Past Due		Total
September 30, 2021
Commercial real estate
Owner occupied	$	72	$	0	$	452	$	524	$	259,656	$	260,180
Non-owner occupied		0		0		2,627		2,627		348,267		350,894
Farmland		356		0		277		633		175,297		175,930
Other		0		0		0		0		78,217		78,217
Commercial
Commercial and industrial		112		358		5,180		5,650		294,434		300,084
Agricultural		87		9		34		130		50,756		50,886
Residential real estate
1-4 family residential		3,399		845		4,426		8,670		367,333		376,003
Home equity lines of credit		253		28		855		1,136		105,622		106,758
Consumer
Indirect		874		57		563		1,494		162,812		164,306
Direct		375		78		330		783		20,816		21,599
Other		33		8		0		41		9,318		9,359
Total loans	$	5,561	$	1,383	$	14,744	$	21,688	$	1,872,528	$	1,894,216

(In Thousands of Dollars)	30-59 Days Past Due		60-89 Days Past Due		90 Days or More Past Due and Nonaccrual		Total Past Due		Loans Not Past Due		Total
December 31, 2020
Originated loans:
Commercial real estate
Owner occupied	$	0	$	0	$	335	$	335	$	214,460	$	214,795
Non-owner occupied		0		0		0		0		309,216		309,216
Farmland		0		0		0		0		156,053		156,053
Other		261		0		0		261		77,725		77,986
Commercial
Commercial and industrial		356		61		3,334		3,751		378,594		382,345
Agricultural		45		255		205		505		44,555		45,060
Residential real estate
1-4 family residential		1,668		974		1,089		3,731		320,129		323,860
Home equity lines of credit		419		0		603		1,022		91,957		92,979
Consumer
Indirect		1,046		285		712		2,043		168,245		170,288
Direct		284		120		268		672		22,789		23,461
Other		24		22		6		52		9,816		9,868
Total originated loans	$	4,103	$	1,717	$	6,552	$	12,372	$	1,793,539	$	1,805,911
Acquired loans:
Commercial real estate
Owner occupied	$	0	$	0	$	27	$	27	$	45,072	$	45,099
Non-owner occupied		197		0		362		559		52,295		52,854
Farmland		0		0		566		566		25,513		26,079
Other		0		0		0		0		12,868		12,868
Commercial
Commercial and industrial		19		390		477		886		17,772		18,658
Agricultural		4		0		4		8		4,841		4,849
Residential real estate
1-4 family residential		1,954		821		5,597		8,372		80,745		89,117
Home equity lines of credit		23		0		186		209		17,175		17,384
Consumer
Direct		20		49		64		133		4,995		5,128
Other		0		0		0		0		97		97
Total acquired loans	$	2,217	$	1,260	$	7,283	$	10,760	$	261,373	$	272,133
Total loans	$	6,320	$	2,977	$	13,835	$	23,132	$	2,054,912	$	2,078,044