XML 22 R12.htm IDEA: XBRL DOCUMENT v3.23.2
LOANS AND ALLOWANCE FOR CREDIT LOSSES
 6 Months Ended
Jun. 30, 2023
LOANS AND ALLOWANCE FOR CREDIT LOSSES [Abstract]  
LOANS AND ALLOWANCE FOR CREDIT LOSSES
NOTE 4 – LOANS AND ALLOWANCE FOR CREDIT LOSSES

Loans are comprised of the following:

  
June 30,
2023
    
December 31,
2022
  
             
Residential real estate
  
$
319,036
    
$
297,036
  
Commercial real estate:
                
Owner-occupied
    
71,486
      
72,719
  
Nonowner-occupied
    
184,304
      
182,831
  
   Construction
    
45,432
      
33,205
  
Commercial and industrial
    
160,747
      
151,232
  
Consumer:
                
Automobile
    
60,230
      
54,837
  
Home equity
    
30,168
      
27,791
  
Other
    
78,549
      
65,398
  
     
949,952
      
885,049
  
Less:  Allowance for credit losses
    
(7,571
)
    
(5,269
)
                 
Loans, net
  
$
942,381
    
$
879,780
  

At June 30, 2023 and December 31, 2022, net deferred loan origination costs were $903 and $663, respectively. At June 30, 2023 and December 31, 2022, net unamortized loan purchase premiums were $787 and $1,142, respectively.

The following table presents the recorded investment of nonaccrual loans and loans past due 90 days or more and still accruing by class of loans as of June 30, 2023 and December 31, 2022:

June 30,2023
  
Loans Past Due
90 Days And
Still Accruing
    
Nonaccrual
Loans With No
ACL
    
Nonaccrual
Loans With an
ACL
    
Total
Nonaccrual
Loans
  
                         
Residential real estate
  
$
39
    
$
—
    
$
1,246
    
$
1,246
  
Commercial real estate:
                                
Owner-occupied
    
—
      
825
      
52
      
877
  
Nonowner-occupied
    
9
      
—
      
68
      
68
  
Construction
    
—
      
—
      
3
      
3
  
Commercial and industrial
    
—
      
—
      
145
      
145
  
Consumer:
                                
Automobile
    
31
      
—
      
144
      
144
  
Home equity
    
—
      
—
      
99
      
99
  
Other
    
12
      
—
      
70
      
70
  
Total
  
$
91
    
$
825
    
$
1,827
    
$
2,652
  

 
December 31, 2022
 
  
Loans Past Due
90 Days And
Still Accruing
    
Nonaccrual
  
             
Residential real estate
  
$
100
    
$
1,708
  
Commercial real estate:
                
Owner-occupied
    
—
      
938
  
Nonowner-occupied
    
—
      
70
  
Construction
    
—
      
75
  
Commercial and industrial
    
—
      
150
  
Consumer:
                
Automobile
    
27
      
82
  
Home equity
    
—
      
151
  
Other
    
411
      
59
  
Total
  
$
538
    
$
3,233
  

The Company recognized $67 and $87 of interest income in nonaccrual loans during the three and six months ended June 30, 2023.

The following table presents the aging of the recorded investment of past due loans by class of loans as of June 30, 2023 and December 31, 2022:

June 30, 2023
  
30-59
Days
Past Due
    
60-89
Days
Past Due
    
90 Days
Or More
Past Due
    
Total
Past Due
    
Loans Not
Past Due
    
Total
  
                                     
Residential real estate
  
$
777
    
$
505
    
$
345
    
$
1,627
    
$
317,409
    
$
319,036
  
Commercial real estate:
                                                
Owner-occupied
    
76
      
77
      
873
      
1,026
      
70,460
      
71,486
  
Nonowner-occupied
    
270
      
—
      
77
      
347
      
183,957
      
184,304
  
Construction
    
-
      
—
      
—
      
-
      
45,432
      
45,432
  
Commercial and industrial
    
81
      
—
      
145
      
226
      
160,521
      
160,747
  
Consumer:
                                                
Automobile
    
828
      
182
      
161
      
1,171
      
59,059
      
60,230
  
Home equity
    
33
      
44
      
99
      
176
      
29,992
      
30,168
  
Other
    
428
      
100
      
65
      
593
      
77,956
      
78,549
  
Total
  
$
2,493
    
$
908
    
$
1,765
    
$
5,166
    
$
944,786
    
$
949,952
  

December 31, 2022
  
30-59
Days
Past Due
    
60-89
Days
Past Due
    
90 Days
Or More
Past Due
    
Total
Past Due
    
Loans Not
Past Due
    
Total
  
                                     
Residential real estate
  
$
1,799
    
$
701
    
$
497
    
$
2,997
    
$
294,039
    
$
297,036
  
Commercial real estate:
                                                
Owner-occupied
    
97
      
—
      
938
      
1,035
      
71,684
      
72,719
  
Nonowner-occupied
    
626
      
5
      
—
      
631
      
182,200
      
182,831
  
Construction
    
40
      
45
      
17
      
102
      
33,103
      
33,205
  
Commercial and industrial
    
21
      
—
      
150
      
171
      
151,061
      
151,232
  
Consumer:
                                                
Automobile
    
804
      
240
      
97
      
1,141
      
53,696
      
54,837
  
Home equity
    
204
      
—
      
151
      
355
      
27,436
      
27,791
  
Other
    
875
      
113
      
452
      
1,440
      
63,958
      
65,398
  
Total
  
$
4,466
    
$
1,104
    
$
2,302
    
$
7,872
    
$
877,177
    
$
885,049
  

Credit Quality Indicators:

The Company categorizes 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. These risk categories are represented by a loan grading scale from 1 through 11. The Company analyzes loans individually with a higher credit risk rating and groups these loans into categories called “criticized” and ”classified” assets. The Company considers its criticized assets to be loans that are graded 8 and its classified assets to be loans that are graded 9 through 11. The Company’s risk categories are reviewed at least annually on loans that have aggregate borrowing amounts that meet or exceed $1,000.

The Company uses the following definitions for its criticized loan risk ratings:

Special Mention.  Loans classified as “special mention” indicate considerable risk due to deterioration of repayment (in the earliest stages) due to potential weak primary repayment source, or payment delinquency.  These loans will be under constant supervision, are not classified and do not expose the institution to sufficient risks to warrant classification.  These deficiencies should be correctable within the normal course of business, although significant changes in company structure or policy may be necessary to correct the deficiencies.  These loans are considered bankable assets with no apparent loss of principal or interest envisioned.  The perceived risk in continued lending is considered to have increased beyond the level where such loans would normally be granted. 

The Company uses the following definitions for its classified loan risk ratings:

Substandard.  Loans classified as “substandard” represent very high risk, serious delinquency, nonaccrual, or unacceptable credit. Repayment through the primary source of repayment is in jeopardy due to the existence of one or more well-defined weaknesses, and the collateral pledged may inadequately protect collection of the loans. Loss of principal is not likely if weaknesses are corrected, although financial statements normally reveal significant weakness. Loans are still considered collectible, although loss of principal is more likely than with special mention loans. Collateral liquidation is considered likely to satisfy debt.

Doubtful.  Loans classified as “doubtful” display a high probability of loss, although the amount of actual loss at the time of classification is undetermined. This classification should be temporary until such time that actual loss can be identified, or improvements are made to reduce the seriousness of the classification. These loans exhibit all substandard characteristics with the addition that weaknesses make collection or liquidation in full highly questionable and improbable. This classification consists of loans where the possibility of loss is high after collateral liquidation based upon existing facts, market conditions, and value. Loss is deferred until certain important and reasonable specific pending factors that may strengthen the credit can be more accurately determined. These factors may include proposed acquisitions, liquidation procedures, capital injection, receipt of additional collateral, mergers, or refinancing plans. A doubtful classification for an entire credit should be avoided when collection of a specific portion appears highly probable with the adequately secured portion graded substandard.

Loss.  Loans classified as “loss” are considered uncollectible and are of such little value that their continuance as bankable assets is not warranted.  This classification does not mean that the credit has absolutely no recovery or salvage value, but rather it is not practical or desirable to defer writing off this asset yielding such a minimum value even though partial recovery may be affected in the future.  Amounts classified as loss should be promptly charged off.

As of June 30, 2023 and December 31, 2022, and based on the most recent analysis performed, the risk category of commercial loans by class of loans was as follows:

                                      
Revolving
        
                                       
Loans
        
   
Term Loans Amortized Cost Basis by Origination Year
    
Amortized
        
June 30, 2023
  
2023
    
2022
    
2021
    
2020
    
2019
    
Prior
    
Cost Basis
    
Total
  
                                                 
Commercial real estate - Owner-occupied
                                                
     Risk Rating
                                                
        Pass
  
$
3,150
    
$
6,871
    
$
25,806
    
$
6,121
    
$
6,558
    
$
18,139
    
$
1,554
    
$
68,199
  
     Special Mention
    
—
      
—
      
—
      
—
      
—
      
533
      
—
      
533
  
        Substandard
    
—
      
—
      
—
      
—
      
490
      
1,964
      
300
      
2,754
  
        Doubtful
    
—
      
—
      
—
      
—
      
—
      
—
      
—
      
—
  
    Total
  
$
3,150
    
$
6,871
    
$
25,806
    
$
6,121
    
$
7,048
    
$
20,636
    
$
1,854
    
$
71,486
  
                                                                 
Current Period gross charge-offs
  
$
—
    
$
—
    
$
—
    
$
—
    
$
—
    
$
—
    
$
—
    
$
—
  

                                     
Revolving
        
                                       
Loans
        
   
Term Loans Amortized Cost Basis by Origination Year
    
Amortized
        
June 30, 2023
  
2023
    
2022
    
2021
    
2020
    
2019
    
Prior
    
Cost Basis
    
Total
  
                                                 
Commercial real estate - Nonowner-occupied
                                                
     Risk Rating
                                                
        Pass
  
$
8,188
    
$
28,927
    
$
34,701
    
$
25,956
    
$
15,695
    
$
64,024
    
$
1,587
    
$
179,078
  
     Special Mention
    
—
      
—
      
—
      
3,276
      
—
      
1,872
      
—
      
5,148
  
        Substandard
    
—
      
—
      
78
      
—
      
—
      
—
      
—
      
78
  
        Doubtful
    
—
      
—
      
—
      
—
      
—
      
—
      
—
      
—
  
    Total
  
$
8,188
    
$
28,927
    
$
34,779
    
$
29,232
    
$
15,695
    
$
65,896
    
$
1,587
    
$
184,304
  
                                                                 
Current Period gross charge-offs
  
$
—
    
$
—
    
$
132
    
$
—
    
$
—
    
$
—
    
$
—
    
$
132
  

                                     
Revolving
        
                                       
Loans
        
   
Term Loans Amortized Cost Basis by Origination Year
    
Amortized
        
June 30, 2023
  
2023
    
2022
    
2021
    
2020
    
2019
    
Prior
    
Cost Basis
    
Total
  
                                                 
Commercial real estate - Construction
                                                
     Risk Rating
                                                
        Pass
  
$
4,262
    
$
30,932
    
$
5,911
    
$
331
    
$
451
    
$
3,484
    
$
61
    
$
45,432
  
     Special Mention
    
—
      
—
      
—
      
—
      
—
      
—
      
—
      
—
  
        Substandard
    
—
      
—
      
—
      
—
      
—
      
—
      
—
      
—
  
        Doubtful
    
—
      
—
      
—
      
—
      
—
      
—
      
—
      
—
  
    Total
  
$
4,262
    
$
30,932
    
$
5,911
    
$
331
    
$
451
    
$
3,484
    
$
61
    
$
45,432
  
                                                                 
Current Period gross charge-offs
  
$
—
    
$
—
    
$
—
    
$
—
    
$
—
    
$
—
    
$
—
    
$
—
  

                                     
Revolving
        
                                       
Loans
        
   
Term Loans Amortized Cost Basis by Origination Year
    
Amortized
        
June 30, 2023
  
2023
    
2022
    
2021
    
2020
    
2019
    
Prior
    
Cost Basis
    
Total
  
                                                 
Commercial and Industrial
                                                
     Risk Rating
                                                
        Pass
  
$
5,061
    
$
33,596
    
$
27,707
    
$
32,679
    
$
536
    
$
29,270
    
$
30,063
    
$
158,912
  
     Special Mention
    
—
      
—
      
—
      
—
      
—
      
39
      
—
      
39
  
        Substandard
    
—
      
—
      
—
      
1,491
      
—
      
305
      
—
      
1,796
  
        Doubtful
    
—
      
—
      
—
      
—
      
—
      
—
      
—
      
—
  
    Total
  
$
5,061
    
$
33,596
    
$
27,707
    
$
34,170
    
$
536
    
$
29,614
    
$
30,063
    
$
160,747
  
                                                                 
Current Period gross charge-offs
  
$
—
    
$
—
    
$
—
    
$
—
    
$
—
    
$
—
    
$
29
    
$
29
  

December 31, 2022
  
Pass
    
Criticized
    
Classified
    
Total
  
Commercial real estate:
                        
Owner-occupied
  
$
68,236
    
$
3,545
    
$
938
    
$
72,719
  
Nonowner-occupied
    
177,479
      
5,352
      
—
      
182,831
  
Construction
    
33,143
      
—
      
62
      
33,205
  
Commercial and industrial
    
147,627
      
1,879
      
1,726
      
151,232
  
Total
  
$
426,485
    
$
10,776
    
$
2,726
    
$
439,987
  

The Company considers the performance of the loan portfolio and its impact on the allowance for credit losses.  For residential and consumer loan classes, the Company evaluates credit quality based on the aging status of the loan, which was previously presented, and by payment activity. The following table presents the recorded investment of residential and consumer loans by class of loans based on repayment activity as of June 30, 2023 and  December 31, 2022:
                                      
Revolving
        
                                       
Loans
        
   
Term Loans Amortized Cost Basis by Origination Year
    
Amortized
        
June 30, 2023
  
2023
    
2022
    
2021
    
2020
    
2019
    
Prior
    
Cost Basis
    
Total
  
                                                 
Residential Real Estate:
                                                
     Payment Performance
                                                
        Performing
  
$
26,473
    
$
41,394
    
$
54,051
    
$
47,025
    
$
22,791
    
$
100,227
    
$
25,790
    
$
317,751
  
        Nonperforming
    
—
      
—
      
—
      
8
      
120
      
1,157
      
—
      
1,285
  
    Total
  
$
26,473
    
$
41,394
    
$
54,051
    
$
47,033
    
$
22,911
    
$
101,384
    
$
25,790
    
$
319,036
  
                                                                 
Current Period gross charge-offs
  
$
—
    
$
1
    
$
3
    
$
—
    
$
—
    
$
67
    
$
—
    
$
71
  

                                     
Revolving
        
                                       
Loans
        
   
Term Loans Amortized Cost Basis by Origination Year
    
Amortized
        
June 30, 2023
  
2023
    
2022
    
2021
    
2020
    
2019
    
Prior
    
Cost Basis
    
Total
  
                                                 
Consumer - Automobile:
                                                
     Payment Performance
                                                
        Performing
  
$
16,765
    
$
26,128
    
$
9,527
    
$
4,219
    
$
1,885
    
$
1,542
    
$
—
    
$
60,066
  
        Nonperforming
    
64
      
42
      
26
      
1
      
19
      
12
      
—
      
164
  
    Total
  
$
16,829
    
$
26,170
    
$
9,553
    
$
4,220
    
$
1,904
    
$
1,554
    
$
—
    
$
60,230
  
                                                                 
Current Period gross charge-offs
  
$
3
    
$
52
    
$
79
    
$
—
    
$
12
    
$
3
    
$
—
    
$
149
  

 
                                      
Revolving
        
                                       
Loans
        
   
Term Loans Amortized Cost Basis by Origination Year
    
Amortized
        
June 30, 2023
  
2023
    
2022
    
2021
    
2020
    
2019
    
Prior
    
Cost Basis
    
Total
  
                                                 
Consumer - Home Equity:
                                                
     Payment Performance
                                                
        Performing
  
$
—
    
$
161
    
$
—
    
$
—
    
$
—
    
$
39
    
$
29,869
    
$
30,069
  
        Nonperforming
    
—
      
—
      
—
      
—
      
—
      
—
      
99
      
99
  
    Total
  
$
—
    
$
161
    
$
—
    
$
—
    
$
—
    
$
39
    
$
29,968
    
$
30,168
  
                                                                 
Current Period gross charge-offs
  
$
—
    
$
—
    
$
—
    
$
—
    
$
—
    
$
—
    
$
43
    
$
43
  

                                     
Revolving
        
                                       
Loans
        
   
Term Loans Amortized Cost Basis by Origination Year
    
Amortized
        
June 30, 2023
  
2023
    
2022
    
2021
    
2020
    
2019
    
Prior
    
Cost Basis
    
Total
  
                                                 
Consumer - Other:
                                                
     Payment Performance
                                                
        Performing
  
$
13,238
    
$
29,701
    
$
13,263
    
$
5,890
    
$
1,648
    
$
1,341
    
$
13,396
    
$
78,477
  
        Nonperforming
    
—
      
9
      
6
      
29
      
13
      
15
      
—
      
72
  
    Total
  
$
13,238
    
$
29,710
    
$
13,269
    
$
5,919
    
$
1,661
    
$
1,356
    
$
13,396
    
$
78,549
  
                                                                 
Current Period gross charge-offs
  
$
154
    
$
54
    
$
75
    
$
38
    
$
21
    
$
15
    
$
92
    
$
449
  

 
Consumer
          
December 31, 2022
Automobile
  
Home Equity
  
Other
  
Residential
Real Estate
  
Total
  
Performing
  
$
54,728
    
$
27,640
    
$
64,928
    
$
295,228
    
$
442,524
  
Nonperforming
    
109
      
151
      
470
      
1,808
      
2,538
  
Total
  
$
54,837
    
$
27,791
    
$
65,398
    
$
297,036
    
$
445,062
  

The Company originates residential, consumer, and commercial loans to customers located primarily in the southeastern areas of Ohio as well as the western counties of West Virginia.  Approximately 4.36% of total loans were unsecured at June 30, 2023, down from 4.52% at December 31, 2022.

Modifications to Borrowers Experiencing Financial Difficulty:
Occasionally, the Company modifies loans to borrowers experiencing financial difficulty.  These modifications may include one or a combination of the following: a reduction of the stated interest rate of the loan; an extension of the maturity date at a stated rate of interest lower than the current market rate for new debt with similar risk; a reduction in the contractual principal and interest payments of the loan; or short-term interest-only payment terms. All modifications to borrowers experiencing financial difficulty are considered to be impaired.

During the six months ended June 30, 2023, the Company experienced no new modifications to borrowers experiencing financial difficulty.

The following table presents the activity in the allowance for credit losses by portfolio segment for the three months ended June 30, 2023 and 2022:

June 30, 2023
  
Residential
Real Estate
    
Commercial
Real Estate
    
Commercial
and Industrial
    
Consumer
    
Total
  
Allowance for credit losses:
                              
Beginning balance
  
$
2,031
    
$
2,306
    
$
1,177
    
$
2,093
    
$
7,607
  
Provision for credit losses
    
89
      
(69
)
    
(176
)
    
270
      
114
  
Loans charged-off
    
(24
)
    
—
      
—
      
(393
)
    
(417
)
Recoveries
    
11
      
15
      
114
      
127
      
267
  
Total ending allowance balance
  
$
2,107
    
$
2,252
    
$
1,115
    
$
2,097
    
$
7,571
  

June 30, 2022
  
Residential
Real Estate
    
Commercial
Real Estate
    
Commercial
and Industrial
    
Consumer
    
Total
  
Allowance for credit losses:
                              
Beginning balance
  
$
714
    
$
1,991
    
$
1,389
    
$
1,174
    
$
5,268
  
Provision for credit losses
    
(77
)
    
(150
)
    
769
      
271
      
813
  
Loans charged-off
    
(39
)
    
(15
)
    
(618
)
    
(372
)
    
(1,044
)
Recoveries
    
16
      
20
      
8
      
133
      
177
  
Total ending allowance balance
  
$
614
    
$
1,846
    
$
1,548
    
$
1,206
    
$
5,214
  

The following table presents the activity in the allowance for credit losses by portfolio segment for the six months ended June 30, 2023 and 2022:

June 30, 2023
  
Residential
Real Estate
    
Commercial
Real Estate
    
Commercial
and Industrial
    
Consumer
    
Total
  
Allowance for credit losses:
                              
Beginning balance
  
$
681
    
$
2,038
    
$
1,293
    
$
1,257
    
$
5,269
  
Impact of adopting ASC 326
    
1,345
      
162
      
(116
)
    
771
      
2,162
  
Provision for credit losses
    
128
      
156
      
(155
)
    
450
      
579
  
Loans charged-off
    
(71
)
    
(132
)
    
(29
)
    
(641
)
    
(873
)
Recoveries
    
24
      
28
      
122
      
260
      
434
  
Total ending allowance balance
  
$
2,107
    
$
2,252
    
$
1,115
    
$
2,097
    
$
7,571
  

June 30, 2022
  
Residential
Real Estate
    
Commercial
Real Estate
    
Commercial
and Industrial
    
Consumer
    
Total
  
Allowance for credit losses:
                              
Beginning balance
  
$
980
    
$
2,548
    
$
1,571
    
$
1,384
    
$
6,483
  
Provision for credit losses
    
(356
)
    
(725
)
    
579
      
189
      
(313
)
Loans charged-off
    
(42
)
    
(16
)
    
(618
)
    
(702
)
    
(1,378
)
Recoveries
    
32
      
39
      
16
      
335
      
422
  
Total ending allowance balance
  
$
614
    
$
1,846
    
$
1,548
    
$
1,206
    
$
5,214
  

The following table presents the balance in the allowance for credit losses and the recorded investment of loans by portfolio segment and based on impairment method as of December 31, 2022:

December 31, 2022
  
Residential
Real Estate
    
Commercial
Real Estate
    
Commercial
and Industrial
    
Consumer
    
Total
  
Allowance for loan losses:
                              
Ending allowance balance attributable to loans:
                              
Individually evaluated for impairment
  
$
—
    
$
—
    
$
—
    
$
—
    
$
—
  
Collectively evaluated for impairment
    
681
      
2,038
      
1,293
      
1,257
      
5,269
  
Total ending allowance balance
  
$
681
    
$
2,038
    
$
1,293
    
$
1,257
    
$
5,269
  
                                         
Loans:
                                        
Loans individually evaluated for impairment
  
$
—
    
$
1,986
    
$
—
    
$
28
    
$
2,014
  
Loans collectively evaluated for impairment
    
297,036
      
286,769
      
151,232
      
147,998
      
883,035
  
Total ending loans balance
  
$
297,036
    
$
288,755
    
$
151,232
    
$
148,026
    
$
885,049
  

The following table presents the amortized cost basis of collateral dependent loans by class of loans as of June 30, 2023:

 
Collateral Type
  
 
June 30, 2023
  
Real Estate
    
Business Assets
    
Total
  
Commercial real estate:
                  
Owner-occupied
  
$
517
    
$
281
    
$
798
  
Consumer:
                        
Home equity
    
27
      
—
      
27
  
Total collateral dependent loans
  
$
544
    
$
281
    
$
825
  

The following tables present information related to loans individually evaluated for impairment by class of loans as of  December 31, 2022:

December 31, 2022
  
Unpaid
Principal
Balance
    
Recorded
Investment
    
Allowance for
Loan Losses
Allocated
  
With an allowance recorded:
  
$
—
    
$
—
    
$
—
  
With no related allowance recorded:
                        
Commercial real estate:
                        
Owner-occupied
    
1,692
      
1,607
      
—
  
Nonowner-occupied
    
379
      
379
      
—
  
Consumer:
                        
Home equity
    
28
      
28
      
—
  
Total
  
$
2,099
    
$
2,014
    
$
—
  

The following tables present information related to loans individually evaluated for impairment by class of loans for the three and six months ended June 30, 2022:

   
Three months ended June 30, 2022
    
Six months ended June 30, 2022
  
 
Average Impaired
Loans
    
Interest Income Recognized
    
Cash Basis Interest Recognized
    
Average Impaired Loans
    
Interest Income Recognized
    
Interest Income Recognized
  
With an allowance recorded:
                                    
   Commercial and industrial
  
$
1,619
    
$
15
    
$
15
    
$
1,744
    
$
54
    
$
54
  
With no related allowance recorded:
                                                
Commercial real estate:
                                                
  Owner-occupied
    
1,675
      
26
      
26
      
1,687
      
48
      
48
  
  Nonowner-occupied
    
382
      
7
      
7
      
383
      
14
      
14
  
Total
  
$
3,676
    
$
48
    
$
48
    
$
3,814
    
$
116
    
$
116
  

The recorded investment of a loan excludes accrued interest and net deferred origination fees and costs due to immateriality.

Nonaccrual loans and loans past due 90 days or more and still accruing include both smaller balance homogenous loans that are collectively evaluated for impairment and individually classified as impaired loans.

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 June 30, 2023, the Company had 68 in other real estate owned for residential real estate properties compared to none at December 31, 2022. In addition, nonaccrual residential mortgage loans that are in the process of foreclosure had a recorded investment of $455 and $370 as of June 30, 2023 and December 31, 2022, respectively.