Loans (Tables)

3 Months Ended

Mar. 31, 2023

Loans and Leases Receivable Disclosure [Abstract]

Loan Portfolio

The Company’s loan portfolio consisted of the following as of the dates indicated (in thousands):

	Principal Amount Outstanding		Net Deferred Loan (Fees) Costs			Loans, Net
March 31, 2023
Commercial business	$	694,427	$	683		$	695,110
Commercial mortgage		1,845,762		(4,281	)		1,841,481
Residential real estate loans		578,363		13,483			591,846
Residential real estate lines		72,793		3,293			76,086
Consumer indirect		984,302		37,900			1,022,202
Other consumer		16,495		112			16,607
Total	$	4,192,142	$	51,190			4,243,332
Allowance for credit losses – loans							(47,528	)
Total loans, net						$	4,195,804
December 31, 2022
Commercial business	$	663,611	$	638		$	664,249
Commercial mortgage		1,683,814		(3,974	)		1,679,840
Residential real estate loans		576,279		13,681			589,960
Residential real estate lines		74,432		3,238			77,670
Consumer indirect		985,580		38,040			1,023,620
Other consumer		15,002		108			15,110
Total	$	3,998,718	$	51,731			4,050,449
Allowance for credit losses – loans							(45,413	)
Total loans, net						$	4,005,036

Recorded Investment by Loan Class in Current and Nonaccrual Loans

The Company’s recorded investment, by loan class, in current and nonaccrual loans, as well as an analysis of accruing delinquent loans is set forth as of the dates indicated (in thousands):

	30-59 Days Past Due		60-89 Days Past Due		Greater Than 90 Days		Total Past Due		Nonaccrual		Current		Total Loans		Nonaccrual with no allowance
March 31, 2023
Commercial business	$	925	$	—	$	—	$	925	$	334	$	693,168	$	694,427	$	233
Commercial mortgage		—		—		—		—		2,550		1,843,212		1,845,762		520
Residential real estate loans		778		49		—		827		3,267		574,269		578,363		3,267
Residential real estate lines		219		30		—		249		159		72,385		72,793		159
Consumer indirect		5,812		1,245		—		7,057		2,487		974,758		984,302		2,487
Other consumer		104		1		4		109		—		16,386		16,495		—
Total loans, gross	$	7,838	$	1,325	$	4	$	9,167	$	8,797	$	4,174,178	$	4,192,142	$	6,666
December 31, 2022
Commercial business	$	176	$	10	$	—	$	186	$	340	$	663,085	$	663,611	$	233
Commercial mortgage		—		—		—		—		2,564		1,681,250		1,683,814		659
Residential real estate loans		1,306		28		—		1,334		4,071		570,874		576,279		4,071
Residential real estate lines		264		102		—		366		142		73,924		74,432		142
Consumer indirect		12,637		2,073		—		14,710		3,079		967,791		985,580		3,079
Other consumer		111		1		1		113		1		14,888		15,002		1
Total loans, gross	$	14,494	$	2,214	$	1	$	16,709	$	10,197	$	3,971,812	$	3,998,718	$	8,185

Amortized Cost basis of Loans Modified to Borrowers Experiencing Financial Difficulty

The following table presents the amortized cost basis of loans modified to borrowers experiencing financial difficulty, disaggregated by loan class and type of concession granted as of March 31, 2023 (in thousands):

	Term Extension
	Amortized Cost Basis		% of Total Loans
Loan Type
Commercial business	$	-		0.00	%
Commercial mortgage		-		0.00	%
Residential real estate loans		158		0.03	%
Residential real estate lines		-		0.00	%
Consumer indirect		-		0.00	%
Other consumer		-		0.00	%
Total	$	158		0.00	%

Financial Effect of the Modifications Made to Borrowers Experiencing Financial Difficulty

The following table describes the financial effect of the modifications made to borrowers experiencing financial difficulty:

Term Extension
Loan Type	Financial Effect
Residential real estate loans	Added a weighted average 10.0 years to the life of the loan, which reduced monthly payment amount for the borrower.

Performance of Loans that are Modified to Borrowers Experiencing Financial Difficulty

The following table depicts the performance of loans that have been modified in the three months ended March 31, 2023 (in thousands):

	Payment Status (Amortized Cost Basis)
	Current		30-89 Days Past Due		90+ Days Past Due
Loan Type
Commercial business	$	-	$	-	$	-
Commercial mortgage		-		-		-
Residential real estate loans		158		-		-
Residential real estate lines		-		-		-
Consumer indirect		-		-		-
Other consumer		-		-		-
Total	$	158	$	-	$	-

Summary of Collateral Dependent Loans

The following table presents the amortized cost basis of collateral dependent loans by collateral type as of March 31, 2023 and December 31, 2022 (in thousands):

	Collateral type
	Business assets		Real property		Total		Specific Reserve
March 31, 2023
Commercial business	$	3,307	$	78	$	3,385	$	732
Commercial mortgage		—		18,546		18,546		1,140
Total	$	3,307	$	18,624	$	21,931	$	1,872
December 31, 2022
Commercial business	$	147	$	993	$	1,140	$	126
Commercial mortgage		—		21,592		21,592		1,152
Total	$	147	$	22,585	$	22,732	$	1,278

Commercial Loan Portfolio Categorized by Internally Assigned Asset Classification

The following tables set forth the Company’s commercial loan portfolio, categorized by internally assigned asset classification, as of the dates indicated (in thousands):

	Term Loans Amortized Cost Basis by Origination Year
	2023		2022		2021		2020		2019		Prior		Revolving Loans Amortized Cost Basis		Revolving Loans Converted to Term		Total
March 31, 2023
Commercial Business:
Uncriticized	$	28,923	$	152,049	$	94,802	$	46,348	$	26,149	$	64,882	$	252,189	$	—	$	665,342
Special mention		—		237		2,388		18,995		12		187		3,272		—		25,091
Substandard		—		41		1,002		1,295		77		1,392		870		—		4,677
Doubtful		—		—		—		—		—		—		—		—		—
Total Commercial Business loans	$	28,923	$	152,327	$	98,192	$	66,638	$	26,238	$	66,461	$	256,331	$	—	$	695,110
Current period gross write-offs	$	—	$	5	$	—	$	7	$	5	$	10	$	—	$	—	$	27
Commercial Mortgage:
Uncriticized	$	167,701	$	506,777	$	382,081	$	244,874	$	155,960	$	342,082	$	—	$	—	$	1,799,475
Special mention		—		—		—		10,118		—		12,033		—		—		22,151
Substandard		—		343		202		105		75		19,130		—		—		19,855
Doubtful		—		—		—		—		—		—		—		—		—
Total Commercial Mortgage loans	$	167,701	$	507,120	$	382,283	$	255,097	$	156,035	$	373,245	$	—	$	—	$	1,841,481
Current period gross write-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

(5.) LOANS (Continued)

	Term Loans Amortized Cost Basis by Origination Year
	2022		2021		2020		2019		2018		Prior		Revolving Loans Amortized Cost Basis		Revolving Loans Converted to Term		Total
December 31, 2022
Commercial Business
Uncriticized	$	146,581	$	105,001	$	61,115	$	29,644	$	39,625	$	21,467	$	244,848	$	—	$	648,281
Special mention		238		2,351		8,736		7		5		—		1,809		—		13,146
Substandard		—		72		—		42		516		1,034		1,158		—		2,822
Doubtful		—		—		—		—		—		—		—		—		—
Total	$	146,819	$	107,424	$	69,851	$	29,693	$	40,146	$	22,501	$	247,815	$	—	$	664,249
Commercial Mortgage
Uncriticized	$	464,863	$	380,138	$	260,463	$	171,918	$	116,770	$	248,771	$	—	$	—	$	1,642,923
Special mention		—		—		2,319		136		—		11,784		—		—		14,239
Substandard		2,987		202		105		78		10,104		9,202		—		—		22,678
Doubtful		—		—		—		—		—		—		—		—		—
Total	$	467,850	$	380,340	$	262,887	$	172,132	$	126,874	$	269,757	$	—	$	—	$	1,679,840

Retail Loan Portfolio Categorized by Performance Status

The following tables set forth the Company’s retail loan portfolio, categorized by performance status, as of the dates indicated (in thousands):

	Term Loans Amortized Cost Basis by Origination Year
	2023		2022		2021		2020		2019		Prior		Revolving Loans Amortized Cost Basis		Revolving Loans Converted to Term		Total
March 31, 2023
Residential Real Estate Loans
Performing	$	14,093	$	80,513	$	84,985	$	116,787	$	75,111	$	217,090	$	—	$	—	$	588,579
Nonperforming		—		104		424		575		430		1,734		—		—		3,267
Total Residential Real Estate Loans	$	14,093	$	80,617	$	85,409	$	117,362	$	75,541	$	218,824	$	—	$	—	$	591,846
Current period gross write-offs	$	—	$	—	$	—	$	—	$	32	$	31	$	—	$	—	$	63
Residential Real Estate Lines
Performing	$	—	$	—	$	—	$	—	$	—	$	—	$	69,849	$	6,078	$	75,927
Nonperforming		—		—		—		—		—		—		41		118		159
Total Residential Real Estate Lines	$	—	$	—	$	—	$	—	$	—	$	—	$	69,890	$	6,196	$	76,086
Current period gross write-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	3	$	13	$	16
Consumer Indirect
Performing	$	84,318	$	418,196	$	305,429	$	112,809	$	51,838	$	47,125	$	—	$	—	$	1,019,715
Nonperforming		—		864		903		337		228		155		—		—		2,487
Total Consumer Indirect Loans	$	84,318	$	419,060	$	306,332	$	113,146	$	52,066	$	47,280	$	—	$	—	$	1,022,202
Current period gross write-offs	$	3	$	1,322	$	1,692	$	497	$	586	$	520	$	—	$	—	$	4,620
Other Consumer
Performing	$	3,748	$	5,367	$	2,285	$	1,735	$	565	$	420	$	2,483	$	—	$	16,603
Nonperforming		—		—		—		—		—		—		4		—		4
Total Other Consumer Loans	$	3,748	$	5,367	$	2,285	$	1,735	$	565	$	420	$	2,487	$	—	$	16,607
Current period gross write-offs	$	265	$	34	$	48	$	9	$	5	$	8	$	13	$	—	$	382

(5.) LOANS (Continued)

	Term Loans Amortized Cost Basis by Origination Year
	2022		2021		2020		2019		2018		Prior		Revolving Loans Amortized Cost Basis		Revolving Loans Converted to Term		Total
December 31, 2022
Residential Real Estate Loans
Performing	$	79,882	$	85,821	$	118,819	$	76,437	$	55,520	$	169,410	$	—	$	—	$	585,889
Nonperforming		—		305		510		795		677		1,784		—		—		4,071
Total	$	79,882	$	86,126	$	119,329	$	77,232	$	56,197	$	171,194	$	—	$	—	$	589,960
Residential Real Estate Lines
Performing	$	—	$	—	$	—	$	—	$	—	$	—	$	70,942	$	6,586	$	77,528
Nonperforming		—		—		—		—		—		—		34		108		142
Total	$	—	$	—	$	—	$	—	$	—	$	—	$	70,976	$	6,694	$	77,670
Consumer Indirect
Performing	$	440,332	$	331,902	$	126,664	$	59,981	$	39,352	$	22,310	$	—	$	—	$	1,020,541
Nonperforming		748		1,209		432		381		205		104		—		—		3,079
Total	$	441,080	$	333,111	$	127,096	$	60,362	$	39,557	$	22,414	$	—	$	—	$	1,023,620
Other Consumer
Performing	$	6,463	$	2,664	$	2,043	$	761	$	213	$	308	$	2,656	$	—	$	15,108
Nonperforming		—		—		—		—		—		—		2		—		2
Total	$	6,463	$	2,664	$	2,043	$	761	$	213	$	308	$	2,658	$	—	$	15,110

Changes in the Allowance for Loan Losses

The following table sets forth the changes in the allowance for credit losses – loans for the three months ended March 31, 2023 and 2022 (in thousands):

	Commercial Business			Commercial Mortgage			Residential Real Estate Loans			Residential Real Estate Lines			Consumer Indirect			Other Consumer			Total
Three months ended March 31, 2023
Allowance for credit losses – loans:
Beginning balance	$	12,585		$	14,412		$	3,301		$	608		$	14,238		$	269		$	45,413
Charge-offs		(27	)		—			(63	)		(16	)		(4,620	)		(382	)		(5,108	)
Recoveries		151			2			5			—			2,782			79			3,019
Provision		202			781			970			59			1,717			475			4,204
Ending balance	$	12,911		$	15,195		$	4,213		$	651		$	14,117		$	441		$	47,528
	Commercial Business			Commercial Mortgage			Residential Real Estate Loans			Residential Real Estate Lines			Consumer Indirect			Other Consumer			Total
Three months ended March 31, 2022
Allowance for credit losses – loans:
Beginning balance	$	11,099		$	14,777		$	1,604		$	379		$	11,611		$	206		$	39,676
Charge-offs		(51	)		—			—			—			(2,486	)		(376	)		(2,913	)
Recoveries		88			1			5			5			1,936			91			2,126
Provision (benefit)		(1,015	)		(1,032	)		243			41			3,507			333			2,077
Ending balance	$	10,121		$	13,746		$	1,852		$	425		$	14,568		$	254		$	40,966