Loans and Allowance for Loan Losses (Tables)

6 Months Ended

Jun. 30, 2022

Loans and Allowance for Loan Losses

Schedule of total loans outstanding by portfolio segment

	June 30,		December 31,
(dollars in thousands)	2022		2021
Commercial
Commercial and industrial (1)	$	484,426	$	436,761
Real estate construction		48,870		40,619
Commercial real estate		599,737		598,893
Total commercial		1,133,033		1,076,273
Consumer
Residential real estate first mortgage		568,571		510,716
Residential real estate junior lien		135,255		125,668
Other revolving and installment		53,384		45,363
Total consumer		757,210		681,747
Total loans	$	1,890,243	$	1,758,020

(1) Included Paycheck Protection Program, or PPP, loans of $6.9 million at June 30, 2022 and $33.6 million at December 31, 2021.

Schedule of past due aging analysis of the loan portfolio

	June 30, 2022
					90 Days
	Accruing		30 - 89 Days		or More				Total
(dollars in thousands)	Current		Past Due		Past Due		Nonaccrual		Loans
Commercial
Commercial and industrial	$	482,743	$	82	$	—	$	1,601	$	484,426
Real estate construction		48,833		37		—		—		48,870
Commercial real estate		599,108		—		—		629		599,737
Total commercial		1,130,684		119		—		2,230		1,133,033
Consumer
Residential real estate first mortgage		565,443		1,255		—		1,873		568,571
Residential real estate junior lien		134,636		426		—		193		135,255
Other revolving and installment		53,123		187		—		74		53,384
Total consumer		753,202		1,868		—		2,140		757,210
Total loans	$	1,883,886	$	1,987	$	—	$	4,370	$	1,890,243

	December 31, 2021
					90 Days
	Accruing		30 - 89 Days		or More				Total
(dollars in thousands)	Current		Past Due		Past Due		Nonaccrual		Loans
Commercial
Commercial and industrial	$	435,135	$	168	$	121	$	1,337	$	436,761
Real estate construction		40,619		—		—		—		40,619
Commercial real estate		598,264		—		—		629		598,893
Total commercial		1,074,018		168		121		1,966		1,076,273
Consumer
Residential real estate first mortgage		508,925		1,770		—		21		510,716
Residential real estate junior lien		125,412		167		—		89		125,668
Other revolving and installment		45,242		121		—		—		45,363
Total consumer		679,579		2,058		—		110		681,747
Total loans	$	1,753,597	$	2,226	$	121	$	2,076	$	1,758,020

Schedule of loans outstanding, by portfolio segment and risk category

	June 30, 2022
			Criticized
			Special
(dollars in thousands)	Pass		Mention		Substandard		Doubtful		Total
Commercial
Commercial and industrial	$	479,586	$	1,204	$	3,636	$	—	$	484,426
Real estate construction		48,870		—		—		—		48,870
Commercial real estate		589,552		4,689		5,496		—		599,737
Total commercial		1,118,008		5,893		9,132		—		1,133,033
Consumer
Residential real estate first mortgage		566,368		65		2,138		—		568,571
Residential real estate junior lien		134,537		—		718		—		135,255
Other revolving and installment		53,310		—		74		—		53,384
Total consumer		754,215		65		2,930		—		757,210
Total loans	$	1,872,223	$	5,958	$	12,062	$	—	$	1,890,243

	December 31, 2021
			Criticized
			Special
(dollars in thousands)	Pass		Mention		Substandard		Doubtful		Total
Commercial
Commercial and industrial	$	430,235	$	480	$	6,046	$	—	$	436,761
Real estate construction		40,619		—		—		—		40,619
Commercial real estate		585,291		—		13,602		—		598,893
Total commercial		1,056,145		480		19,648		—		1,076,273
Consumer
Residential real estate first mortgage		510,375		—		341		—		510,716
Residential real estate junior lien		124,898		—		770		—		125,668
Other revolving and installment		45,363		—		—		—		45,363
Total consumer		680,636		—		1,111		—		681,747
Total loans	$	1,736,781	$	480	$	20,759	$	—	$	1,758,020

Summary of changes in allowances

	Three months ended June 30, 2022
	Beginning		Provision for		Loan		Loan		Ending
(dollars in thousands)	Balance		Loan Losses		Charge-offs		Recoveries		Balance
Commercial
Commercial and industrial	$	9,795	$	1,085	$	(637)	$	90	$	10,333
Real estate construction		810		68		—		—		878
Commercial real estate		11,946		(1,123)		—		11		10,834
Total commercial		22,551		30		(637)		101		22,045
Consumer
Residential real estate first mortgage		6,661		(486)		—		—		6,175
Residential real estate junior lien		1,400		(134)		—		201		1,467
Other revolving and installment		644		(5)		(37)		32		634
Total consumer		8,705		(625)		(37)		233		8,276
Unallocated		457		595		—		—		1,052
Total	$	31,713	$	—	$	(674)	$	334	$	31,373

	Six months ended June 30, 2022
	Beginning		Provision for		Loan		Loan		Ending
(dollars in thousands)	Balance		Loan Losses		Charge-offs		Recoveries		Balance
Commercial
Commercial and industrial	$	8,925	$	1,856	$	(664)	$	216	$	10,333
Real estate construction		783		95		—		—		878
Commercial real estate		12,376		(1,564)		—		22		10,834
Total commercial		22,084		387		(664)		238		22,045
Consumer
Residential real estate first mortgage		6,532		(357)		—		—		6,175
Residential real estate junior lien		1,295		(42)		—		214		1,467
Other revolving and installment		481		140		(55)		68		634
Total consumer		8,308		(259)		(55)		282		8,276
Unallocated		1,180		(128)		—		—		1,052
Total	$	31,572	$	—	$	(719)	$	520	$	31,373

	Three months ended June 30, 2021
	Beginning		Provision for		Loan		Loan		Ending
(dollars in thousands)	Balance		Loan Losses		Charge-offs		Recoveries		Balance
Commercial
Commercial and industrial	$	10,487	$	(869)	$	(273)	$	275	$	9,620
Real estate construction		598		(11)		—		—		587
Commercial real estate		13,849		(913)		—		1		12,937
Total commercial		24,934		(1,793)		(273)		276		23,144
Consumer
Residential real estate first mortgage		6,047		129		—		—		6,176
Residential real estate junior lien		1,288		99		—		14		1,401
Other revolving and installment		666		(81)		(49)		38		574
Total consumer		8,001		147		(49)		52		8,151
Unallocated		823		1,646		—		—		2,469
Total	$	33,758	$	—	$	(322)	$	328	$	33,764

	Six months ended June 30, 2021
	Beginning		Provision for		Loan		Loan		Ending
(dollars in thousands)	Balance		Loan Losses		Charge-offs		Recoveries		Balance
Commercial
Commercial and industrial	$	10,205	$	(553)	$	(477)	$	445	$	9,620
Real estate construction		658		(71)		—		—		587
Commercial real estate		14,105		(636)		(536)		4		12,937
Total commercial		24,968		(1,260)		(1,013)		449		23,144
Consumer
Residential real estate first mortgage		5,774		402		—		—		6,176
Residential real estate junior lien		1,373		(69)		—		97		1,401
Other revolving and installment		753		(164)		(93)		78		574
Total consumer		7,900		169		(93)		175		8,151
Unallocated		1,378		1,091		—		—		2,469
Total	$	34,246	$	—	$	(1,106)	$	624	$	33,764

Schedule of loans distributed by portfolio segment and impairment methodology

	June 30, 2022
	Recorded Investment						Allowance for Loan Losses
	Individually		Collectively				Individually		Collectively
(dollars in thousands)	Evaluated		Evaluated		Total		Evaluated		Evaluated		Total
Commercial
Commercial and industrial	$	1,769	$	482,657	$	484,426	$	828	$	9,505	$	10,333
Real estate construction		—		48,870		48,870		—		878		878
Commercial real estate		803		598,934		599,737		3		10,831		10,834
Total commercial		2,572		1,130,461		1,133,033		831		21,214		22,045
Consumer
Residential real estate first mortgage		1,873		566,698		568,571		—		6,175		6,175
Residential real estate junior lien		193		135,062		135,255		—		1,467		1,467
Other revolving and installment		74		53,310		53,384		27		607		634
Total consumer		2,140		755,070		757,210		27		8,249		8,276
Unallocated		—		—		—		—		—		1,052
Total loans	$	4,712	$	1,885,531	$	1,890,243	$	858	$	29,463	$	31,373

	December 31, 2021
	Recorded Investment						Allowance for Loan Losses
	Individually		Collectively				Individually		Collectively
(dollars in thousands)	Evaluated		Evaluated		Total		Evaluated		Evaluated		Total
Commercial
Commercial and industrial	$	1,831	$	434,930	$	436,761	$	278	$	8,647	$	8,925
Real estate construction		—		40,619		40,619		—		783		783
Commercial real estate		809		598,084		598,893		5		12,371		12,376
Total commercial		2,640		1,073,633		1,076,273		283		21,801		22,084
Consumer
Residential real estate first mortgage		21		510,695		510,716		—		6,532		6,532
Residential real estate junior lien		91		125,577		125,668		—		1,295		1,295
Other revolving and installment		—		45,363		45,363		—		481		481
Total consumer		112		681,635		681,747		—		8,308		8,308
Unallocated		—		—		—		—		—		1,180
Total loans	$	2,752	$	1,755,268	$	1,758,020	$	283	$	30,109	$	31,572

Schedule of impaired loans

	June 30, 2022						December 31, 2021
	Recorded		Unpaid		Related		Recorded		Unpaid		Related
(dollars in thousands)	Investment		Principal		Allowance		Investment		Principal		Allowance
Impaired loans with a valuation allowance
Commercial and industrial	$	1,008	$	1,036	$	828	$	445	$	464	$	278
Commercial real estate		174		195		3		180		203		5
Residential real estate junior lien		—		—		—		—		—		—
Other revolving and installment		74		74		27		—		—		—
Total impaired loans with a valuation allowance		1,256		1,305		858		625		667		283
Impaired loans without a valuation allowance
Commercial and industrial		761		873		—		1,386		1,575		—
Commercial real estate		629		684		—		629		684		—
Residential real estate first mortgage		1,873		1,910		—		21		24		—
Residential real estate junior lien		193		226		—		91		120		—
Other revolving and installment		—		—		—		—		—		—
Total impaired loans without a valuation allowance		3,456		3,693		—		2,127		2,403		—
Total impaired loans
Commercial and industrial		1,769		1,909		828		1,831		2,039		278
Commercial real estate		803		879		3		809		887		5
Residential real estate first mortgage		1,873		1,910		—		21		24		—
Residential real estate junior lien		193		226		—		91		120		—
Other revolving and installment		74		74		27		—		—		—
Total impaired loans	$	4,712	$	4,998	$	858	$	2,752	$	3,070	$	283

The table below presents the average recorded investment in impaired loans and interest income for the three and six months ended June 30, 2022 and 2021:

	Three months ended June 30,
	2022				2021
	Average				Average
	Recorded		Interest		Recorded		Interest
(dollars in thousands)	Investment		Income		Investment		Income
Impaired loans with a valuation allowance
Commercial and industrial	$	1,018	$	2	$	1,548	$	3
Commercial real estate		176		2		188		2
Residential real estate first mortgage		—		—		—		—
Residential real estate junior lien		—		—		27		—
Other revolving and installment		75		—		13		—
Total impaired loans with a valuation allowance		1,269		4		1,776		5
Impaired loans without a valuation allowance
Commercial and industrial		761		—		1,174		5
Commercial real estate		629		—		4,472		—
Residential real estate first mortgage		1,962		—		23		—
Residential real estate junior lien		196		—		302		—
Other revolving and installment		—		—		—		—
Total impaired loans without a valuation allowance		3,548		—		5,971		5
Total impaired loans
Commercial and industrial		1,779		2		2,722		8
Commercial real estate		805		2		4,660		2
Residential real estate first mortgage		1,962		—		23		—
Residential real estate junior lien		196		—		329		—
Other revolving and installment		75		—		13		—
Total impaired loans	$	4,817	$	4	$	7,747	$	10

	Six Months Ended June 30,
	2022				2021
	Average				Average
	Recorded		Interest		Recorded		Interest
(dollars in thousands)	Investment		Income		Investment		Income
Impaired loans with a valuation allowance
Commercial and industrial	$	1,156	$	6	$	1,637	$	6
Commercial real estate		177		3		190		4
Residential real estate junior lien		—		—		30		—
Other revolving and installment		157		—		14		—
Total impaired loans with a valuation allowance		1,490		9		1,871		10
Impaired loans without a valuation allowance
Commercial and industrial		761		—		1,187		11
Commercial real estate		629		—		4,662		—
Residential real estate first mortgage		1,953		—		24		—
Residential real estate junior lien		198		—		303		—
Other revolving and installment		—		—		—		—
Total impaired loans without a valuation allowance		3,541		—		6,176		11
Total impaired loans
Commercial and industrial		1,917		6		2,824		17
Commercial real estate		806		3		4,852		4
Residential real estate first mortgage		1,953		—		24		—
Residential real estate junior lien		198		—		333		—
Other revolving and installment		157		—		14		—
Total impaired loans	$	5,031	$	9	$	8,047	$	21