OTHER REAL ESTATE OWNED ("OREO")

6 Months Ended

Jun. 30, 2022

OTHER REAL ESTATE OWNED (“OREO”)

OREO assets are presented net of the valuation allowance. The Company considers OREO as classified assets for regulatory and financial reporting. OREO carrying amounts reflect management’s estimate of the realizable value of these properties incorporating current appraised values, local real estate market conditions and related costs. An analysis of activity follows.


	Six Months Ended June 30,				Years Ended December 31,
(dollars in thousands)	2022		2021		2021
Balance at beginning of year	$	—	$	3,109	$	3,109
Additions of underlying property	—		—		—
Disposals of underlying property	—		(932)		(1,722)
Valuation allowance	—		(641)		(1,387)
Balance at end of period	$	—	$	1,536	$	—

Expenses applicable to OREO assets included the following.


	Six Months Ended June 30,
(dollars in thousands)	2022		2021
Valuation allowance	$	—	$	641
Losses (gains) on dispositions	—		(16)
Operating expenses	6		44
	$	6	$	669

The Company had $0.1 million impaired loans secured by residential real estate for which formal foreclosure proceedings were in process as of June 30, 2022. There were no loans secured by residential real estate for which formal foreclosure proceedings were in the process as of December 31, 2021.