Variable Interest Entity

12 Months Ended

Dec. 31, 2022

Variable interest entities [Abstract]

Variable interest entity

NOTE 3: VARIABLE INTEREST ENTITIES

Generally, a variable interest entity (“VIE”) is a corporation, partnership, trust or other legal structure that does not have

equity investors with substantive or proportional voting rights or has equity investors that do not provide sufficient financial

resources for the entity to support its activities. 

At December 31, 2022, the Company did not have any consolidated VIEs to disclose but did have one nonconsolidated

VIE, discussed below.

New Markets Tax Credit Investment

The New Markets Tax Credit (“NMTC”) program provides federal tax incentives to investors to make investments in

distressed communities and promotes economic improvement through the development of successful businesses in these

communities. The NMTC is available to investors over seven years and is subject to recapture if certain events occur

during such period. The Company had one investment with a balance of $2.1 million and $2.2 million at December 31,

2022 and 2021, respectively, and is included in other assets in the consolidated balance sheets. The Company’s equity

investment meets the definition of a VIE. While the Company’s investment exceeds 50% of the outstanding equity

interests, the Company does not consolidate the VIE because it does not meet the characteristics of a primary beneficiary

since the Company lacks the power to direct the activities of the VIE.

(Dollars in thousands)

Maximum

Loss Exposure

Asset Recognized

Classification

Type:

New Markets Tax Credit investment

$

2,110

$

2,110

Other assets