Loans and Allowance for Credit Losses (Tables)

12 Months Ended

Dec. 31, 2023

Loans and Allowance for Credit Losses

Schedule of total loans outstanding by portfolio segment

	December 31,		December 31,
(dollars in thousands)	2023		2022
Commercial
Commercial and industrial	$	598,321	$	583,876
Real estate construction		124,034		97,810
Commercial real estate		1,126,912		881,670
Total commercial		1,849,267		1,563,356
Consumer
Residential real estate first mortgage		726,879		679,551
Residential real estate junior lien		154,134		150,479
Other revolving and installment		29,303		50,608
Total consumer		910,316		880,638
Total loans	$	2,759,583	$	2,443,994

Summary of changes in allowances

	Year ended December 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	$	9,233	$	(707)	$	645	$	(436)	$	1,159	$	9,894
Real estate construction		1,437		2,549		2,125		—		—		6,111
Commercial real estate		12,761		(131)		(778)		—		45		11,897
Total commercial		23,431		1,711		1,992		(436)		1,204		27,902
Consumer
Residential real estate first mortgage		5,857		2,269		(1,829)		(49)		330		6,578
Residential real estate junior lien		1,318		(27)		(115)		(77)		52		1,151
Other revolving and installment		540		(96)		(273)		(51)		92		212
Total consumer		7,715		2,146		(2,217)		(177)		474		7,941
Total	$	31,146	$	3,857	$	(225)	$	(613)	$	1,678	$	35,843

(1) The difference in the credit loss expense reported herein compared to the consolidated statements of income is associated with the credit loss expense of $2.2 million related to off-balance sheet credit exposure and $40 thousand related to investment securities held-to-maturity.

	Year ended December 31, 2022
	Beginning		Provision for		Loan		Loan		Ending
(dollars in thousands)	Balance		Loan Losses		Charge-offs		Recoveries		Balance
Commercial
Commercial and industrial	$	9,218	$	950	$	(1,396)	$	461	$	9,233
Real estate construction		810		551		—		76		1,437
Commercial real estate		12,778		(151)		—		134		12,761
Total commercial		22,806		1,350		(1,396)		671		23,431
Consumer
Residential real estate first mortgage		6,874		(1,017)		—		—		5,857
Residential real estate junior lien		1,380		(344)		—		282		1,318
Other revolving and installment		512		11		(153)		170		540
Total consumer		8,766		(1,350)		(153)		452		7,715
Total	$	31,572	$	—	$	(1,549)	$	1,123	$	31,146

	Year ended December 31, 2021
	Beginning		Provision for		Loan		Loan		Ending
(dollars in thousands)	Balance		Loan Losses		Charge-offs		Recoveries		Balance
Commercial
Commercial and industrial	$	10,547	$	(1,759)	$	(1,230)	$	1,660	$	9,218
Real estate construction		690		120		—		—		810
Commercial real estate		14,574		(2,082)		(536)		822		12,778
Total commercial		25,811		(3,721)		(1,766)		2,482		22,806
Consumer
Residential real estate first mortgage		6,174		700		—		—		6,874
Residential real estate junior lien		1,472		(215)		—		123		1,380
Other revolving and installment		789		(264)		(156)		143		512
Total consumer		8,435		221		(156)		266		8,766
Total	$	34,246	$	(3,500)	$	(1,922)	$	2,748	$	31,572

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 December 31, 2023	2023		2022		2021		2020		2019		Prior		Cost Basis		Total
Commercial and industrial
Pass	$	197,533	$	89,090	$	67,691	$	64,272	$	34,603	$	15,053	$	100,239	$	568,481
Special mention		—		—		—		—		—		—		—		—
Substandard		464		4,844		236		6,328		94		2,513		15,361		29,840
Doubtful		—		—		—		—		—		—		—		—
Subtotal	$	197,997	$	93,934	$	67,927	$	70,600	$	34,697	$	17,566	$	115,600	$	598,321
Gross charge-offs for the year ended	$	39	$	—	$	49	$	11	$	247	$	90	$	—	$	436
Real estate construction
Pass	$	29,902	$	57,944	$	14,326	$	122	$	—	$	952	$	121	$	103,367
Special mention		—		—		—		—		—		—		—		—
Substandard		—		20,667		—		—		—		—		—		20,667
Doubtful		—		—		—		—		—		—		—		—
Subtotal	$	29,902	$	78,611	$	14,326	$	122	$	—	$	952	$	121	$	124,034
Gross charge-offs for the year ended	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Commercial real estate
Pass	$	272,261	$	265,549	$	142,027	$	153,796	$	116,861	$	159,454	$	7,794	$	1,117,742
Special mention		—		—		—		—		—		262		—		262
Substandard		—		587		2,872		—		3,690		1,759		—		8,908
Doubtful		—		—		—		—		—		—		—		—
Subtotal	$	272,261	$	266,136	$	144,899	$	153,796	$	120,551	$	161,475	$	7,794	$	1,126,912
Gross charge-offs for the year ended	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Residential real estate first mortgage
Performing	$	72,180	$	207,177	$	218,719	$	108,100	$	33,102	$	87,212	$	284	$	726,774
Non-performing		—		—		—		—		—		105		—		105
Subtotal	$	72,180	$	207,177	$	218,719	$	108,100	$	33,102	$	87,317	$	284	$	726,879
Gross charge-offs for the year ended	$	—	$	—	$	9	$	—	$	—	$	40	$	—	$	49
Residential real estate junior lien
Performing	$	18,408	$	15,655	$	5,946	$	4,857	$	1,769	$	5,280	$	100,438	$	152,353
Non-performing		—		—		—		—		—		—		1,781		1,781
Subtotal	$	18,408	$	15,655	$	5,946	$	4,857	$	1,769	$	5,280	$	102,219	$	154,134
Gross charge-offs for the year ended	$	—	$	—	$	—	$	—	$	—	$	77	$	—	$	77
Other revolving and installment
Performing	$	5,320	$	6,395	$	980	$	4,489	$	1,554	$	952	$	9,613	$	29,303
Non-performing		—		—		—		—		—		—		—		—
Subtotal	$	5,320	$	6,395	$	980	$	4,489	$	1,554	$	952	$	9,613	$	29,303
Gross charge-offs for the year ended	$	4	$	2	$	—	$	31	$	6	$	8	$	—	$	51
Total loans	$	596,068	$	667,908	$	452,797	$	341,964	$	191,673	$	273,542	$	235,631	$	2,759,583
Gross charge-offs for the year ended	$	43	$	2	$	58	$	42	$	253	$	215	$	—	$	613

The following table sets forth the risk category of loans by class and credit quality indicator used on the most recent analysis performed as of December 31, 2022:

	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

Schedule of past due aging analysis of the loan portfolio

	December 31, 2023
							90 Days
	Accruing		30 - 59 Days		60 - 89 Days		or More				Total
(dollars in thousands)	Current		Past Due		Past Due		Past Due		Nonaccrual		Loans
Commercial
Commercial and industrial	$	590,663	$	924	$	—	$	139	$	6,595	$	598,321
Real estate construction		124,034		—		—		—		—		124,034
Commercial real estate		1,125,669		128		—		—		1,115		1,126,912
Total commercial		1,840,366		1,052		—		139		7,710		1,849,267
Consumer
Residential real estate first mortgage		724,786		901		554		—		638		726,879
Residential real estate junior lien		153,220		666		—		—		248		154,134
Other revolving and installment		29,086		170		47		—		—		29,303
Total consumer		907,092		1,737		601		—		886		910,316
Total loans	$	2,747,458	$	2,789	$	601	$	139	$	8,596	$	2,759,583

	December 31, 2022
							90 Days
	Accruing		30 - 59 Days		60 - 89 Days		or More				Total
(dollars in thousands)	Current		Past Due		Past Due		Past Due		Nonaccrual		Loans
Commercial
Commercial and industrial	$	580,288	$	2,332	$	94	$	—	$	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		2,700		94		—		3,074		1,563,356
Consumer
Residential real estate first mortgage		677,471		1,234		311		—		535		679,551
Residential real estate junior lien		149,918		377		—		—		184		150,479
Other revolving and installment		50,360		237		10		—		1		50,608
Total consumer		877,749		1,848		321		—		720		880,638
Total loans	$	2,435,237	$	4,548	$	415	$	—	$	3,794	$	2,443,994

Schedule of amortized cost basis on nonaccrual status loans

	As of December 31, 2023
					90 Days
	Nonaccrual				or More
	with no Allowance				Past Due
(dollars in thousands)	for Credit Losses		Nonaccrual		and Accruing
Commercial
Commercial and industrial	$	79	$	6,595	$	139
Real estate construction		—		—		—
Commercial real estate		95		1,115		—
Total commercial		174		7,710		139
Consumer
Residential real estate first mortgage		632		638		—
Residential real estate junior lien		185		248		—
Other revolving and installment		—		—		—
Total consumer		817		886		—
Total loans	$	991	$	8,596	$	139

	December 31, 2022
					90 Days
	Nonaccrual				or More
	with no Allowance				Past Due
(dollars in thousands)	for Credit Losses		Nonaccrual		and Accruing
Commercial
Commercial and industrial	$	638	$	1,162	$	—
Real estate construction		—		440		—
Commercial real estate		576		1,472		—
Total commercial		1,214		3,074		—
Consumer
Residential real estate first mortgage		535		535		—
Residential real estate junior lien		184		184		—
Other revolving and installment		1		1		—
Total consumer		720		720		—
Total loans	$	1,934	$	3,794	$	—

Schedule of financing receivables collateral dependent loans

	As of December 31, 2023
	Primary Type of Collateral
									Allowance for
(dollars in thousands)	Real estate		Equipment		Other		Total		Credit Losses
Commercial
Commercial and industrial	$	6,124	$	—	$	—	$	6,124	$	2,384
Commercial real estate		695		—		96		791		601
Total commercial		6,819		—		96		6,915		2,985
Consumer
Residential real estate first mortgage		638		—		—		638		3
Residential real estate junior lien		134		22		93		249		6
Total consumer		772		22		93		887		9
Total loans	$	7,591	$	22	$	189	$	7,802	$	2,994

Schedule of recorded investment and related allowance for loan losses on loans by portfolio segment methodology

	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	$	8,958	$	9,233
Real estate construction		262		97,548		97,810		97		1,340		1,437
Commercial real estate		1,472		880,198		881,670		582		12,179		12,761
Total commercial		3,047		1,560,309		1,563,356		954		22,477		23,431
Consumer
Residential real estate first mortgage		535		679,016		679,551		—		5,857		5,857
Residential real estate junior lien		184		150,295		150,479		—		1,318		1,318
Other revolving and installment		1		50,607		50,608		—		540		540
Total consumer		720		879,918		880,638		—		7,715		7,715
Total loans	$	3,767	$	2,440,227	$	2,443,994	$	954	$	30,192	$	31,146

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

	Year Ended December 31,
	2022				2021
	Average				Average
	Recorded		Interest		Recorded		Interest
(dollars in thousands)	Investment		Income		Investment		Income
Impaired loans with a valuation allowance
Commercial and industrial	$	722	$	13	$	517	$	13
Real estate construction		442		—		—		—
Commercial real estate		935		—		187		7
Residential real estate first mortgage		—		—		—
Residential real estate junior lien		—		—		—		—
Other revolving and installment		—		—		—		—
Total impaired loans with a valuation allowance		2,099		13		704		20
Impaired loans without a valuation allowance
Commercial and industrial		707		—		1,988		20
Real estate construction		—		—		—		—
Commercial real estate		618		—		672		—
Residential real estate first mortgage		575		—		23		—
Residential real estate junior lien		191		—		98		—
Other revolving and installment		1		—		1		—
Total impaired loans without a valuation allowance		2,092		—		2,782		20
Total impaired loans
Commercial and industrial		1,429		13		2,505		33
Real estate construction		442		—		—		—
Commercial real estate		1,553		—		859		7
Residential real estate first mortgage		575		—		23		—
Residential real estate junior lien		191		—		98		—
Other revolving and installment		1		—		1		—
Total impaired loans	$	4,191	$	13	$	3,486	$	40