Loans and Allowance for Loan Losses (Tables)

3 Months Ended

Mar. 31, 2023

Loans and Allowance for Credit Losses on Loans

Schedule of total loans outstanding by portfolio segment

	March 31,		December 31,
(dollars in thousands)	2023		2022
Commercial
Commercial and industrial	$	553,578	$	583,876
Real estate construction		108,776		97,810
Commercial real estate		934,324		881,670
Total commercial		1,596,678		1,563,356
Consumer
Residential real estate first mortgage		698,002		679,551
Residential real estate junior lien		152,281		150,479
Other revolving and installment		39,664		50,608
Total consumer		889,947		880,638
Total loans	$	2,486,625	$	2,443,994

Schedule of past due aging analysis of the loan portfolio

	March 31, 2023
					90 Days
	Accruing		30 - 89 Days		or More				Total
(dollars in thousands)	Current		Past Due		Past Due		Nonaccrual		Loans
Commercial
Commercial and industrial	$	552,921	$	300	$	—	$	357	$	553,578
Real estate construction		108,336		—		—		440		108,776
Commercial real estate		933,266		162		—		896		934,324
Total commercial		1,594,523		462		—		1,693		1,596,678
Consumer
Residential real estate first mortgage		697,012		566		—		424		698,002
Residential real estate junior lien		151,703		578		—		—		152,281
Other revolving and installment		39,484		179		—		1		39,664
Total consumer		888,199		1,323		—		425		889,947
Total loans	$	2,482,722	$	1,785	$	—	$	2,118	$	2,486,625

	December 31, 2022
					90 Days
	Accruing		30 - 89 Days		or More				Total
(dollars in thousands)	Current		Past Due		Past Due		Nonaccrual		Loans
Commercial
Commercial and industrial	$	580,288	$	2,426	$	—	$	1,162	$	583,876
Real estate construction		97,370		—		—		440		97,810
Commercial real estate		879,830		368		—		1,472		881,670
Total commercial		1,557,488		2,794		—		3,074		1,563,356
Consumer
Residential real estate first mortgage		677,471		1,545		—		535		679,551
Residential real estate junior lien		149,918		377		—		184		150,479
Other revolving and installment		50,360		247		—		1		50,608
Total consumer		877,749		2,169		—		720		880,638
Total loans	$	2,435,237	$	4,963	$	—	$	3,794	$	2,443,994

Schedule of amortized cost basis on loans

	As of March 31, 2023
	Nonaccrual				90 Days
	with no Allowance				or More
(dollars in thousands)	for Credit Losses		Nonaccrual		Past Due
Commercial
Commercial and industrial	$	—	$	357	$	—
Real estate construction		—		440		—
Commercial real estate		—		896		—
Total commercial		—		1,693		—
Consumer
Residential real estate first mortgage		120		424		—
Residential real estate junior lien		—		—		—
Other revolving and installment		—		1		—
Total consumer		120		425		—
Total loans	$	120	$	2,118	$	—

Schedule of loans outstanding, by portfolio segment and risk category

													Revolving
(dollars in thousands)	Term Loans Amortized Cost Basis by Origination Year												Loans Amortized
As of March 31, 2023	2023		2022		2021		2020		2019		Prior		Cost Basis		Total
Commercial and industrial
Pass	$	40,436	$	142,529	$	92,778	$	88,486	$	42,374	$	22,866	$	98,960	$	528,429
Substandard		—		1,970		1,033		6		440		749		20,951		25,149
Subtotal		40,436		144,499		93,811		88,492		42,814		23,615		119,911		553,578
Real estate construction
Pass		—		41,291		31,177		27,531		8,337		—		—		108,336
Substandard		—		—		—		440		—		—		—		440
Subtotal		—		41,291		31,177		27,971		8,337		—		—		108,776
Commercial real estate
Pass		63,474		295,580		165,134		155,213		120,223		121,249		5,423		926,296
Substandard		—		—		1,559		—		4,157		2,312		—		8,028
Subtotal		63,474		295,580		166,693		155,213		124,380		123,561		5,423		934,324
Residential real estate first mortgage
Pass		26,898		194,425		228,747		116,075		36,246		94,149		1,293		697,833
Special mention		—		61		—		—		—		—		—		61
Substandard		—		—		—		—		—		108		—		108
Subtotal		26,898		194,486		228,747		116,075		36,246		94,257		1,293		698,002
Residential real estate junior lien
Pass		3,005		12,380		6,864		5,278		2,136		5,260		116,948		151,871
Substandard		—		—		—		—		—		—		410		410
Subtotal		3,005		12,380		6,864		5,278		2,136		5,260		117,358		152,281
Other revolving and installment
Pass		1,674		9,968		1,685		7,278		3,075		2,768		13,215		39,663
Substandard		—		—		—		—		—		1		—		1
Subtotal		1,674		9,968		1,685		7,278		3,075		2,769		13,215		39,664
Total loans	$	135,487	$	698,204	$	528,977	$	400,307	$	216,988	$	249,462	$	257,200	$	2,486,625

	December 31, 2022
			Criticized
			Special
(dollars in thousands)	Pass		Mention		Substandard		Doubtful		Total
Commercial
Commercial and industrial	$	558,694	$	21,969	$	3,213	$	—	$	583,876
Real estate construction		97,548		—		262		—		97,810
Commercial real estate		873,270		—		8,400		—		881,670
Total commercial		1,529,512		21,969		11,875		—		1,563,356
Consumer
Residential real estate first mortgage		678,743		63		745		—		679,551
Residential real estate junior lien		149,847		—		632		—		150,479
Other revolving and installment		50,607		—		1		—		50,608
Total consumer		879,197		63		1,378		—		880,638
Total loans	$	2,408,709	$	22,032	$	13,253	$	—	$	2,443,994

Summary of changes in allowances

	Three months ended March 31, 2023
	Beginning		Adoption		Provision for		Loan		Loan		Ending
(dollars in thousands)	Balance		of ASC 326		Credit Losses(1)		Charge-offs		Recoveries		Balance
Commercial
Commercial and industrial	$	9,158	$	(862)	$	(377)	$	(175)	$	56	$	7,800
Real estate construction		1,446		2,518		442		—		—		4,406
Commercial real estate		12,688		(424)		69		—		11		12,344
Total commercial		23,292		1,232		134		(175)		67		24,550
Consumer
Residential real estate first mortgage		5,769		2,080		209		—		2		8,060
Residential real estate junior lien		1,289		(67)		126		(77)		6		1,277
Other revolving and installment		528		(104)		(117)		(5)		12		314
Total consumer		7,586		1,909		218		(82)		20		9,651
Unallocated		268		716		(83)		—		—		901
Total	$	31,146	$	3,857	$	269	$	(257)	$	87	$	35,102

(1) The difference in the credit loss expense reported herein as compared to the Consolidated Statements of Income is associated with the credit loss expense of $230 thousand related to off-balance sheet credit exposures and $51 thousand related to investment securities held-to-maturity.

	Three months ended March 31, 2022
	Beginning		Provision for		Loan		Loan		Ending
(dollars in thousands)	Balance		Loan Losses		Charge-offs		Recoveries		Balance
Commercial
Commercial and industrial	$	8,925	$	771	$	(27)	$	126	$	9,795
Real estate construction		783		27		—		—		810
Commercial real estate		12,376		(441)		—		11		11,946
Total commercial		22,084		357		(27)		137		22,551
Consumer
Residential real estate first mortgage		6,532		129		—		—		6,661
Residential real estate junior lien		1,295		92		—		13		1,400
Other revolving and installment		481		145		(18)		36		644
Total consumer		8,308		366		(18)		49		8,705
Unallocated		1,180		(723)		—		—		457
Total	$	31,572	$	—	$	(45)	$	186	$	31,713

Schedule of summary of charge-offs

	Gross Charge-offs for the three months ended March 31, 2023
(dollars in thousands)	2023		2022		2021		2020		2019		Prior		Total
Commercial
Commercial and industrial	$	(16)	$	—	$	—	$	—	$	(159)	$	—	$	(175)
Real estate construction		—		—		—		—		—		—		—
Commercial real estate		—		—		—		—		—		—		—
Total commercial		(16)		—		—		—		(159)		—		(175)
Consumer
Residential real estate first mortgage		—		—		—		—		—		—		—
Residential real estate junior lien		—		—		—		—		—		(77)		(77)
Other revolving and installment		—		(2)		—		—		(3)		—		(5)
Total consumer		—		(2)		—		—		(3)		(77)		(82)
Total loans	$	(16)	$	(2)	$	—	$	—	$	(162)	$	(77)	$	(257)

Schedule of amortized cost and related allowance for credit losses on loans by portfolio segment methodology

	March 31, 2023
	Amortized Cost						Allowance for Credit Losses on Loans
	Individually		Collectively				Individually		Collectively
	Evaluated for		Evaluated for				Evaluated for		Evaluated for
(dollars in thousands)	Impairment		Impairment		Total		Impairment		Impairment		Total
Commercial
Commercial and industrial	$	1,095	$	552,483	$	553,578	$	215	$	7,585	$	7,800
Real estate construction		262		108,514		108,776		—		4,406		4,406
Commercial real estate		896		933,428		934,324		—		12,344		12,344
Total commercial		2,253		1,594,425		1,596,678		215		24,335		24,550
Consumer
Residential real estate first mortgage		424		697,578		698,002		73		7,987		8,060
Residential real estate junior lien		—		152,281		152,281		—		1,277		1,277
Other revolving and installment		1		39,663		39,664		—		314		314
Total consumer		425		889,522		889,947		73		9,578		9,651
Unallocated		—		—		—		—		—		901
Total loans	$	2,678	$	2,483,947	$	2,486,625	$	288	$	33,913	$	35,102

	December 31, 2022
	Recorded Investment						Allowance for Loan Losses
	Individually		Collectively				Individually		Collectively
(dollars in thousands)	Evaluated		Evaluated		Total		Evaluated		Evaluated		Total
Commercial
Commercial and industrial	$	1,313	$	582,563	$	583,876	$	275	$	8,883	$	9,158
Real estate construction		262		97,548		97,810		97		1,349		1,446
Commercial real estate		1,472		880,198		881,670		582		12,106		12,688
Total commercial		3,047		1,560,309		1,563,356		954		22,338		23,292
Consumer
Residential real estate first mortgage		535		679,016		679,551		—		5,769		5,769
Residential real estate junior lien		184		150,295		150,479		—		1,289		1,289
Other revolving and installment		1		50,607		50,608		—		528		528
Total consumer		720		879,918		880,638		—		7,586		7,586
Unallocated		—		—		—		—		—		268
Total loans	$	3,767	$	2,440,227	$	2,443,994	$	954	$	29,924	$	31,146

Schedule of financing receivables collateral dependent loans

	As of March 31, 2023
	Primary Type of Collateral
									Allowance for
(dollars in thousands)	Real estate		Equipment		Other		Total		Credit Losses
Commercial
Commercial and industrial	$	—	$	120	$	—	$	120	$	60
Total commercial		—		120		—		120		60
Consumer
Residential real estate first mortgage		424		—		—		—		10
Total consumer		424		—		—		—		10
Total loans	$	424	$	120	$	—	$	120	$	70

Schedule of impaired loans

	December 31, 2022
	Recorded		Unpaid		Related
(dollars in thousands)	Investment		Principal		Allowance
Impaired loans with a valuation allowance
Commercial and industrial	$	675	$	711	$	275
Real estate construction		262		440		97
Commercial real estate		896		900		582
Residential real estate first mortgage		—		—		—
Total impaired loans with a valuation allowance		1,833		2,051		954
Impaired loans without a valuation allowance
Commercial and industrial		638		767		—
Real estate construction		—		—		—
Commercial real estate		576		660		—
Residential real estate first mortgage		535		573		—
Residential real estate junior lien		184		218		—
Other revolving and installment		1		1		—
Total impaired loans without a valuation allowance		1,934		2,219		—
Total impaired loans
Commercial and industrial		1,313		1,478		275
Real estate construction		262		440		97
Commercial real estate		1,472		1,560		582
Residential real estate first mortgage		535		573		—
Residential real estate junior lien		184		218		—
Other revolving and installment		1		1		—
Total impaired loans	$	3,767	$	4,270	$	954

The table below presents the average recorded investment in impaired loans and interest income for the three months ended March 31, 2023:

	2022
	Average
	Recorded		Interest
(dollars in thousands)	Investment		Income
Impaired loans with a valuation allowance
Commercial and industrial	$	528	$	3
Commercial real estate		180		2
Residential real estate first mortgage		—		—
Residential real estate junior lien		—		—
Other revolving and installment		41		—
Total impaired loans with a valuation allowance		749		5
Impaired loans without a valuation allowance
Commercial and industrial		1,126		—
Real estate construction		—		—
Commercial real estate		642		—
Residential real estate first mortgage		1,759		—
Residential real estate junior lien		230		—
Other revolving and installment		9		—
Total impaired loans without a valuation allowance		3,766		—
Total impaired loans
Commercial and industrial		1,654		3
Real estate construction		—		—
Commercial real estate		822		2
Residential real estate first mortgage		1,759		—
Residential real estate junior lien		230		—
Other revolving and installment		50		—
Total impaired loans	$	4,515	$	5