☒ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
March 31, 2022
☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
CB FINANCIAL SERVICES, INC. | ||||||||
(Exact name of registrant as specified in its charter) |
Pennsylvania | 51-0534721 | |||||||
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) |
100 N. Market Street, Carmichaels, PA | 15320 | |||||||
(Address of principal executive offices) | (Zip Code) |
(724) 966-5041 | ||||||||
(Registrant’s telephone number, including area code) |
N/A | ||||||||
(Former name, former address and former fiscal year, if changed since last report) |
Common stock, par value $0.4167 per share | CBFV | The Nasdaq Stock Market, LLC | ||||||||||||
(Title of each class) | (Trading symbol) | (Name of each exchange on which registered) |
Yes
☒No ☐Large accelerated filer ☐ | Accelerated filer | ||||||||||
Non-accelerated filer | Smaller reporting company | ||||||||||
Emerging growth company |
Page
Page | |||||
(Unaudited) | |||||||||||||||||||||||
(Dollars in thousands, except share data) | September 30, 2017 | December 31, 2016 | |||||||||||||||||||||
(Unaudited) March 31, 2022 | December 31, 2021 | ||||||||||||||||||||||
(Dollars in thousands, except per share and share data) | (Dollars in thousands, except per share and share data) | ||||||||||||||||||||||
ASSETS | ASSETS | ASSETS | |||||||||||||||||||||
Cash and Due From Banks: | Cash and Due From Banks: | ||||||||||||||||||||||
Interest Bearing | $ | 31,979 | $ | 7,699 | Interest Bearing | $ | 55,233 | $ | 63,968 | ||||||||||||||
Non-Interest Bearing | 11,766 | 6,583 | Non-Interest Bearing | 68,355 | 55,706 | ||||||||||||||||||
Total Cash and Due From Banks | 43,745 | 14,282 | Total Cash and Due From Banks | 123,588 | 119,674 | ||||||||||||||||||
Investment Securities: | |||||||||||||||||||||||
Available-for-Sale | 115,889 | 106,208 | |||||||||||||||||||||
Loans, Net | 695,718 | 674,094 | |||||||||||||||||||||
Securities: | Securities: | ||||||||||||||||||||||
Available-for-Sale Debt Securities, at Fair Value | Available-for-Sale Debt Securities, at Fair Value | 228,238 | 222,108 | ||||||||||||||||||||
Equity Securities, at Fair Value | Equity Securities, at Fair Value | 2,859 | 2,866 | ||||||||||||||||||||
Total Securities | Total Securities | 231,097 | 224,974 | ||||||||||||||||||||
Loans, Net of Allowance for Loan Losses of $11,595 and $11,582 at March 31, 2022 and December 31, 2021, Respectively | Loans, Net of Allowance for Loan Losses of $11,595 and $11,582 at March 31, 2022 and December 31, 2021, Respectively | 1,009,047 | 1,009,214 | ||||||||||||||||||||
Premises and Equipment, Net | 16,558 | 14,132 | Premises and Equipment, Net | 18,349 | 18,399 | ||||||||||||||||||
Bank-Owned Life Insurance | 19,035 | 18,687 | Bank-Owned Life Insurance | 25,468 | 25,332 | ||||||||||||||||||
Goodwill | 4,953 | 4,953 | Goodwill | 9,732 | 9,732 | ||||||||||||||||||
Core Deposit Intangible, Net | 3,418 | 3,819 | |||||||||||||||||||||
Accrued Interest and Other Assets | 9,013 | 9,900 | |||||||||||||||||||||
Intangible Assets, Net | Intangible Assets, Net | 4,850 | 5,295 | ||||||||||||||||||||
Accrued Interest Receivable and Other Assets | Accrued Interest Receivable and Other Assets | 16,539 | 12,859 | ||||||||||||||||||||
TOTAL ASSETS | $ | 908,329 | $ | 846,075 | TOTAL ASSETS | $ | 1,438,670 | $ | 1,425,479 | ||||||||||||||
LIABILITIES | LIABILITIES | ||||||||||||||||||||||
Deposits: | Deposits: | ||||||||||||||||||||||
Demand Deposits | $ | 187,968 | $ | 165,400 | |||||||||||||||||||
Non-Interest Bearing Demand Deposits | Non-Interest Bearing Demand Deposits | 400,105 | 385,775 | ||||||||||||||||||||
NOW Accounts | 139,191 | 105,962 | NOW Accounts | 280,455 | 272,518 | ||||||||||||||||||
Money Market Accounts | 139,244 | 141,674 | Money Market Accounts | 192,929 | 192,125 | ||||||||||||||||||
Savings Accounts | 131,262 | 121,520 | Savings Accounts | 247,589 | 239,482 | ||||||||||||||||||
Time Deposits | 160,466 | 155,028 | Time Deposits | 129,235 | 136,713 | ||||||||||||||||||
Brokered Deposits | 4,243 | 8,634 | |||||||||||||||||||||
Total Deposits | 762,374 | 698,218 | Total Deposits | 1,250,313 | 1,226,613 | ||||||||||||||||||
Short-Term Borrowings | 24,662 | 27,027 | Short-Term Borrowings | 39,219 | 39,266 | ||||||||||||||||||
Other Borrowed Funds | 24,500 | 28,000 | |||||||||||||||||||||
Accrued Interest and Other Liabilities | 3,639 | 3,361 | |||||||||||||||||||||
Other Borrowings | Other Borrowings | 17,607 | 17,601 | ||||||||||||||||||||
Accrued Interest Payable and Other Liabilities | Accrued Interest Payable and Other Liabilities | 9,375 | 8,875 | ||||||||||||||||||||
TOTAL LIABILITIES | 815,175 | 756,606 | TOTAL LIABILITIES | 1,316,514 | 1,292,355 | ||||||||||||||||||
STOCKHOLDERS' EQUITY | STOCKHOLDERS' EQUITY | ||||||||||||||||||||||
Preferred Stock, No Par Value; 5,000,000 Shares Authorized | - | - | Preferred Stock, No Par Value; 5,000,000 Shares Authorized | — | — | ||||||||||||||||||
Common Stock, $0.4167 Par Value; 35,000,000 Shares Authorized, 4,363,346 Shares Issued and 4,088,025 and 4,086,625 Shares Outstanding at September 30, 2017 and December 31, 2016, Respectively | 1,818 | 1,818 | |||||||||||||||||||||
Common Stock, $0.4167 Par Value; 35,000,000 Shares Authorized, 5,701,758 Shares Issued and 5,156,897 and 5,260,672 Shares Outstanding at March 31, 2022 and December 31, 2021, Respectively | Common Stock, $0.4167 Par Value; 35,000,000 Shares Authorized, 5,701,758 Shares Issued and 5,156,897 and 5,260,672 Shares Outstanding at March 31, 2022 and December 31, 2021, Respectively | 2,376 | 2,367 | ||||||||||||||||||||
Capital Surplus | 42,128 | 41,863 | Capital Surplus | 83,422 | 83,294 | ||||||||||||||||||
Retained Earnings | 54,584 | 51,713 | Retained Earnings | 59,343 | 57,534 | ||||||||||||||||||
Treasury Stock, at Cost (275,321 and 276,721 Shares at September 30, 2017 and December 31, 2016, Respectively) | (4,722 | ) | (4,746 | ) | |||||||||||||||||||
Treasury Stock, at Cost (544,861 and 420,321 Shares at March 31, 2022 and December 31, 2021, Respectively) | Treasury Stock, at Cost (544,861 and 420,321 Shares at March 31, 2022 and December 31, 2021, Respectively) | (12,367) | (9,144) | ||||||||||||||||||||
Accumulated Other Comprehensive Loss | (654 | ) | (1,179 | ) | Accumulated Other Comprehensive Loss | (10,618) | (927) | ||||||||||||||||
TOTAL STOCKHOLDERS' EQUITY | 93,154 | 89,469 | TOTAL STOCKHOLDERS' EQUITY | 122,156 | 133,124 | ||||||||||||||||||
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ | 908,329 | $ | 846,075 | TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ | 1,438,670 | $ | 1,425,479 |
STATEMENTSTATEMENTS OF INCOME (UNAUDITED)Three Months Ended
March 31, Three Months Ended
September 30, Nine Months Ended
September 30,2022 2021 (Dollars in thousands, except share and per share data) 2017 2016 2017 2016 (Dollars in thousands, except share and per share data) INTEREST AND DIVIDEND INCOME INTEREST AND DIVIDEND INCOME Loans, Including Fees $ 7,459 $ 7,093 $ 21,830 $ 21,913 Loans, Including Fees $ 9,551 $ 10,146 Federal Funds Sold 64 3 120 15 Investment Securities: Investment Securities: Taxable 386 287 1,133 918 Taxable 905 646 Exempt From Federal Income Tax 229 261 665 787 Tax-Exempt Tax-Exempt 66 78 Dividends Dividends 22 20 Other Interest and Dividend Income 75 40 205 123 Other Interest and Dividend Income 72 98 TOTAL INTEREST AND DIVIDEND INCOME 8,213 7,684 23,953 23,756 TOTAL INTEREST AND DIVIDEND INCOME 10,616 10,988 INTEREST EXPENSE INTEREST EXPENSE Deposits 720 557 2,050 1,678 Deposits 530 947 Federal Funds Purchased - 1 - 2 Short-Term Borrowings 20 21 59 50 Short-Term Borrowings 19 23 Other Borrowed Funds 120 129 361 383 Other Borrowings Other Borrowings 174 41 TOTAL INTEREST EXPENSE 860 708 2,470 2,113 TOTAL INTEREST EXPENSE 723 1,011 NET INTEREST INCOME 7,353 6,976 21,483 21,643 NET INTEREST AND DIVIDEND INCOME NET INTEREST AND DIVIDEND INCOME 9,893 9,977 Provision For Loan Losses 300 450 1,020 1,600 Provision For Loan Losses — — NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES 7,053 6,526 20,463 20,043 NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES 9,893 9,977 NONINTEREST INCOME NONINTEREST INCOME Service Fees on Deposit Accounts 630 619 1,839 1,811 Service Fees Service Fees 526 546 Insurance Commissions 758 676 2,686 2,291 Insurance Commissions 1,798 1,595 Other Commissions 125 112 336 341 Other Commissions 89 165 Net Gains on Sales of Loans 137 249 389 559 Net Gains on Sales of Investments 10 22 132 80 Net Gains on Purchased Tax Credits 14 - 43 - Net Gain on Sales of Loans Net Gain on Sales of Loans — 86 Net (Loss) Gain on Securities Net (Loss) Gain on Securities (7) 447 Net Gain on Purchased Tax Credits Net Gain on Purchased Tax Credits 14 18 Net Loss on Disposal of Fixed Assets Net Loss on Disposal of Fixed Assets (8) — Income from Bank-Owned Life Insurance 116 123 348 362 Income from Bank-Owned Life Insurance 136 137 Other 28 20 87 93 Other Income Other Income 65 180 TOTAL NONINTEREST INCOME 1,818 1,821 5,860 5,537 TOTAL NONINTEREST INCOME 2,613 3,174 NONINTEREST EXPENSE NONINTEREST EXPENSE Salaries and Employee Benefits 3,512 3,291 10,425 9,945 Salaries and Employee Benefits 4,565 4,894 Occupancy 526 544 1,678 1,456 Occupancy 686 710 Equipment 464 463 1,376 1,317 Equipment 210 266 Data Processing Data Processing 485 518 FDIC Assessment 104 112 267 353 FDIC Assessment 209 250 PA Shares Tax 186 138 562 543 PA Shares Tax 240 265 Contracted Services 119 155 408 444 Contracted Services 587 687 Legal and Professional Fees 81 140 324 395 Legal and Professional Fees 152 189 Advertising 197 189 504 543 Advertising 116 140 Bankcard Processing Expense 130 125 384 359 Other Real Estate Owned (Income) Expense (349 ) 4 (343 ) (531 ) Amortization of Core Deposit Intangible 134 134 401 401 Other 793 870 2,432 2,542 Other Real Estate Owned (Income) Other Real Estate Owned (Income) (38) (38) Amortization of Intangible Assets Amortization of Intangible Assets 445 532 Other Expense Other Expense 999 982 TOTAL NONINTEREST EXPENSE 5,897 6,165 18,418 17,767 TOTAL NONINTEREST EXPENSE 8,656 9,395 Income Before Income Taxes 2,974 2,182 7,905 7,813 Income Taxes 910 607 2,336 2,255 Income Before Income Tax Expense Income Before Income Tax Expense 3,850 3,756 Income Tax Expense Income Tax Expense 803 911 NET INCOME $ 2,064 $ 1,575 $ 5,569 $ 5,558 NET INCOME $ 3,047 $ 2,845 EARNINGS PER SHARE EARNINGS PER SHARE Basic $ 0.50 $ 0.38 $ 1.36 $ 1.36 Basic $ 0.59 $ 0.52 Diluted 0.50 0.38 1.36 1.36 Diluted 0.58 0.52 WEIGHTED AVERAGE SHARES OUTSTANDING WEIGHTED AVERAGE SHARES OUTSTANDING Basic 4,088,025 4,081,017 4,087,783 4,081,017 Basic 5,198,194 5,434,374 Diluted 4,108,723 4,087,337 4,104,157 4,084,730 Diluted 5,220,887 5,436,881
STATEMENTSTATEMENTS OF COMPREHENSIVE (LOSS) INCOME (UNAUDITED) Three Months Ended
September 30, Nine Months Ended
September 30,(Dollars in thousands) 2017 2016 2017 2016 Net Income $ 2,064 $ 1,575 $ 5,569 $ 5,558 Other Comprehensive Income (Loss): Unrealized Gains (Losses) on Available-for-Sale Securities Net of Income Tax of $5 and ($106) for the Three Months Ended September 30, 2017 and 2016, Respectively, and $314 and $57 for the Nine Months Ended September 30, 2017 and 2016, Respectively 9 (205 ) 612 111 Reclassification Adjustment for Gains on Securities: Included in Net Income, Net of Income Tax of $4 and $7 for the Three Months Ended September 30, 2017 and 2016, Respectively, and $45 and $27 for the Nine Months Ended September 30, 2017 and 2016, Respectively (1) (6 ) (15 ) (87 ) (53 ) Other Comprehensive Income (Loss), Net of Income Tax 3 (220 ) 525 58 Total Comprehensive Income $ 2,067 $ 1,355 $ 6,094 $ 5,616 Three Months Ended
March 31,2022 2021 (Dollars in thousands) Net Income $ 3,047 $ 2,845 Other Comprehensive (Loss) Income: Change in Unrealized (Loss) on Investment Securities Available-for-Sale (12,351) (2,851) Income Tax Effect 2,660 612 — (225) — 48 Other Comprehensive (Loss), Net of Income Tax Effect (9,691) (2,416) Total Comprehensive (Loss) Income $ (6,644) $ 429
CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS’ EQUITY (UNAUDITED)
(Dollars in thousands, except share and per share data) | Shares Issued | Common Stock | Capital Surplus | Retained Earnings | Treasury Stock | Accumulated Other Comprehensive Income | Total Stockholders' Equity | |||||||||||||||||||||
December 31, 2015 | 4,363,346 | $ | 1,818 | $ | 41,614 | $ | 47,725 | $ | (4,836 | ) | $ | 575 | $ | 86,896 | ||||||||||||||
Comprehensive Income: | ||||||||||||||||||||||||||||
Net Income | - | - | - | 5,558 | - | - | 5,558 | |||||||||||||||||||||
Other Comprehensive Income | - | - | - | - | - | 58 | 58 | |||||||||||||||||||||
Stock-Based Compensation Expense | - | - | 262 | - | - | - | 262 | |||||||||||||||||||||
Dividends Paid ($0.22 Per Share) | - | - | - | (2,694 | ) | - | - | (2,694 | ) | |||||||||||||||||||
September 30, 2016 | 4,363,346 | $ | 1,818 | $ | 41,876 | $ | 50,589 | $ | (4,836 | ) | $ | 633 | $ | 90,080 |
(Dollars in thousands, except share and per share data) | Shares Issued | Common Stock | Capital Surplus | Retained Earnings | Treasury Stock | Accumulated Other Comprehensive Income | Total Stockholders' Equity | |||||||||||||||||||||
December 31, 2016 | 4,363,346 | $ | 1,818 | $ | 41,863 | $ | 51,713 | $ | (4,746 | ) | $ | (1,179 | ) | $ | 89,469 | |||||||||||||
Comprehensive Income: | ||||||||||||||||||||||||||||
Net Income | - | - | - | 5,569 | - | - | 5,569 | |||||||||||||||||||||
Other Comprehensive Income | - | - | - | - | - | 525 | 525 | |||||||||||||||||||||
Stock-Based Compensation Expense | - | - | 258 | - | - | - | 258 | |||||||||||||||||||||
Exercise of Stock Options | - | - | 7 | - | 24 | - | 31 | |||||||||||||||||||||
Dividends Paid ($0.22 Per Share) | - | - | - | (2,698 | ) | - | - | (2,698 | ) | |||||||||||||||||||
September 30, 2017 | 4,363,346 | $ | 1,818 | $ | 42,128 | $ | 54,584 | $ | (4,722 | ) | $ | (654 | ) | $ | 93,154 |
STATEMENTSTATEMENTS OF CASH FLOWSCHANGES IN STOCKHOLDERS’ EQUITY (UNAUDITED) Nine Months Ended
September 30,(Dollars in thousands) 2017 2016 OPERATING ACTIVITIES Net Income $ 5,569 $ 5,558 Αdjustmеnts to Rеconcilе Net Income to Net Cash Provided By Operating Activities: Net Amortization on Investments 265 154 Depreciation and Amortization 1,867 2,051 Provision for Loan Losses 1,020 1,600 Income from Bank-Owned Life Insurance (348 ) (362 ) Proceeds From Mortgage Loans Sold 16,941 18,945 Originations of Mortgage Loans for Sale (16,552 ) (18,386 ) Gains on Sales of Loans (389 ) (559 ) Gains on Sales of Investment Securities (132 ) (80 ) Gains on Sales of Other Real Estate Owned and Repossessed Assets (357 ) (49 ) Noncash Expense for Stock-Based Compensation 258 262 (Increase) Decrease in Accrued Interest Receivable (131 ) 197 Valuation Adjustment on Foreclosed Real Estate - (566 ) Retirements of Premises and Equipment 152 - (Decrease) Increase in Taxes Payable (808 ) 1,123 Increase (Decrease) in Accrued Interest Payable 79 (10 ) Net Payment of Federal/State Income Taxes (2,355 ) (2,115 ) Other, Net 4,327 419 NET CASH PROVIDED BY OPERATING ACTIVITIES 9,406 8,182 INVESTING ACTIVITIES Investment Securities Available for Sale: Proceeds From Principal Repayments and Maturities 11,683 59,023 Purchases of Securities (32,346 ) (60,035 ) Proceeds from Sales of Securities 11,643 416 Net Increase in Loans (23,413 ) (572 ) Purchase of Premises and Equipment (3,444 ) (1,229 ) Proceeds From Sales of Other Real Estate Owned and Repossessed Assets 357 175 (Increase) Decrease in Restricted Equity Securities (47 ) 122 NET CASH USED IN INVESTING ACTIVITIES (35,567 ) (2,100 ) FINANCING ACTIVITIES Net Increase (Decrease) in Deposits 64,156 (951 ) Net (Decrease) Increase in Short-Term Borrowings (2,365 ) 1,167 Principal Payments on Other Borrowed Funds (3,500 ) - Cash Dividends Paid (2,698 ) (2,694 ) Treasury Stock, Purchases at Cost 24 - Exercise of Stock Options 7 - NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES 55,624 (2,478 ) INCREASE IN CASH AND CASH EQUIVALENTS 29,463 3,604 CASH AND DUE FROM BANKS AT BEGINNING OF YEAR 14,282 11,340 CASH AND DUE FROM BANKS AT END OF PERIOD $ 43,745 $ 14,944 SUPPLEMENTAL CASH FLOW INFORMATION: Cash paid for: Interest on deposits and borrowings (including interest credited to deposit accounts of $1,968 and $1,686 respectively) $ 2,390 $ 2,123 Income taxes 2,355 2,115 Real estate acquired in settlement of loans 169 3,236 Transfer of real estate acquired in settlement of loans to premise and equipment - 2,350
Three Months Ended March 31, 2022 Shares Issued Common Stock Capital Surplus Retained Earnings Treasury Stock Accumulated Other Comprehensive Loss Total Stockholders' Equity (Dollars in thousands, except share and per share data) December 31, 2021 5,680,993 $ 2,367 $ 83,294 $ 57,534 $ (9,144) $ (927) $ 133,124 Comprehensive Loss: Net Income — — — 3,047 — — 3,047 Other Comprehensive Loss — — — — — (9,691) (9,691) Restricted Stock Awards Granted 20,765 9 (9) — — — — Restricted Stock Awards Forfeited — — 4 — (4) — — Stock-Based Compensation Expense — — 130 — — — 130 Exercise of Stock Options — — 3 — 164 — 167 Treasury stock purchased, at cost (131,840 shares) — — — — (3,383) — (3,383) Dividends Paid ($0.24 Per Share) — — — (1,238) — — (1,238) March 31, 2022 5,701,758 $ 2,376 $ 83,422 $ 59,343 $ (12,367) $ (10,618) $ 122,156 Three Months Ended March 31, 2021 Shares Issued Common Stock Capital Surplus Retained Earnings Treasury Stock Accumulated Other Comprehensive Income Total Stockholders' Equity (Dollars in thousands, except share and per share data) December 31, 2020 5,680,993 $ 2,367 $ 82,723 $ 51,132 $ (5,094) $ 3,402 $ 134,530 Comprehensive Income: Net Income — — — 2,845 — — 2,845 Other Comprehensive Loss — — — — — (2,416) (2,416) Stock-Based Compensation Expense — — 121 — — — 121 Dividends Paid ($0.24 Per Share) — — — (1,304) — — (1,304) March 31, 2021 5,680,993 $ 2,367 $ 82,844 $ 52,673 $ (5,094) $ 986 $ 133,776 Three Months Ended March 31, 2022 2021 (Dollars in thousands) OPERATING ACTIVITIES Net Income $ 3,047 $ 2,845 Adjustments to Reconcile Net Income to Net Cash Provided By Operating Activities Net Amortization on Securities 17 31 Depreciation and Amortization 637 562 Loss (Gain) on Securities 7 (447) Gain on Purchased Tax Credits (14) (18) Income from Bank-Owned Life Insurance (136) (137) Proceeds From Mortgage Loans Sold — 2,251 Originations of Mortgage Loans for Sale — (2,165) Gain on Sale of Loans — (86) Gain on Sale of Other Real Estate Owned and Repossessed Assets (1) — Noncash Expense for Stock-Based Compensation 130 121 Decrease in Accrued Interest Receivable 94 134 Net Loss on Disposal of Fixed Assets 8 — Increase in Taxes Payable 956 893 Payments on Operating Leases — (88) Decrease in Accrued Interest Payable 60 (141) Other, Net (1,640) 714 NET CASH PROVIDED BY OPERATING ACTIVITIES 3,165 4,469 INVESTING ACTIVITIES Investment Securities Available for Sale: Proceeds From Principal Repayments and Maturities 8,328 10,953 Purchases of Securities (26,826) (22,299) Proceeds from Sale of Securities — 11,930 Net Decrease in Loans 223 3,148 Purchase of Premises and Equipment (186) (199) Proceeds From Sale of Other Real Estate Owned 37 — (Increase) Decrease in Restricted Equity Securities (26) 200 NET CASH (USED) PROVIDED BY INVESTING ACTIVITIES (18,450) 3,733 FINANCING ACTIVITIES Net Increase in Deposits 23,700 59,894 Net (Decrease) Increase in Short-Term Borrowings (47) 4,297 Principal Payments on Other Borrowed Funds — (2,000) Cash Dividends Paid (1,238) (1,304) Treasury Stock, Purchases at Cost (3,383) — Exercise of Stock Options 167 — NET CASH PROVIDED BY FINANCING ACTIVITIES 19,199 60,887 INCREASE IN CASH AND CASH EQUIVALENTS 3,914 69,089 CASH AND DUE FROM BANKS AT BEGINNING OF YEAR 119,674 160,911 CASH AND DUE FROM BANKS AT END OF PERIOD $ 123,588 $ 230,000 Three Months Ended March 31, 2022 2022 2021 (Dollars in thousands) SUPPLEMENTAL CASH FLOW INFORMATION: Cash Paid For: Interest on Deposits and Borrowings (Including Interest Credited to Deposits of $450 and $1,084, Respectively) $ 486 $ 1,153 SUPPLEMENTAL NONCASH DISCLOSURE: Right of Use Asset Recognized 1,175 — Lease Liability Recognized 1,175 — UNAUDITEDTHE CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
The Company will continue to evaluate the provisions of Accounting Standards Codification (“ASC”) Topic 280 for segment reporting information related to Exchange Underwriters. During the first quarter, Exchange Underwriters insurance commissions comprised of approximately 11% of combined interest and noninterest income but less than 10% of the combined assets of the Company. While EU exceeded the 10% threshold of combined interest and noninterest income, this was primarily related to a unique income event of increased contingency income. Contingency fees are commissions that are contingent upon several factors including, but not limited to, eligible written premiums, earned premiums, incurred losses and stop loss charges. On a year-to-date basis, Exchange Underwriters fell below the 10% threshold of combined interest and noninterest income.
Acquired Loans
Loans thatUnderwriters, a full-service, independent insurance agency.
For performing loans acquired in the merger, the excess of cash flows expected at acquisition over the estimated fair value is referred to as the accretable discount and is recognized into interest income over the remaining life of the loan. For purchased credit impaired (“PCI”) loans acquired in the merger, the difference between contractually required payments at acquisition and the cash flows expected to be collected at acquisition is referred to as the nonaccretable discount. The nonaccretable discount represents estimated future credit losses expected to be incurred over the life of the loan. Subsequent decreasesthree months ended March 31, 2022. See Note 1 to the expected cash flows require an evaluation to determine the need for an allowance for loan losses. Subsequent improvementsconsolidated financial statements included in expected cash flows result in the reversal of a corresponding amount of the nonaccretable discount which is then reclassified as accretable discount that is recognized into interest income over the remaining life of the loan using the interest method. The evaluation of the amount of future cash flows that is expected to be collected is performed in a similar manner as that used to determine our allowance for credit losses. Charge-offs of the principal amountAnnual Report on acquired loans would be first applied to the nonaccretable discount portion of the fair value adjustment.
Reclassifications
Certain comparative amountsForm 10-K for the prior year have been reclassified to conform to the current year presentation. Such reclassifications did not affect net income or stockholders’ equity.
Recent Accounting Standards
In September 2017, the FASB issued Accounting Standards Update ("ASU") 2017-13, Revenue Recognition (Topic 605), Revenue from Contracts with Customers (Topic 606), Leases (Topic 840), and Leases (Topic 842): Amendments to SEC Paragraphs Pursuant to the Staff Announcement at the July 20, 2017 EITF Meeting and Rescission of Prior SEC Staff Announcements and Observer Comments. ASU 2017-13 amends the early adoption date option for certain companies related to the adoption of ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) and ASU No. 2016-02, Leases (Topic 842). The SEC staff stated the SEC would not object to a public business entity that otherwise would not meet the definition of a public business entity except for a requirement to include or the inclusion of its financial statements or financial information in another entity’s filingended December 31, 2021, as filed with the SEC, adopting ASC Topic 606 for annual reporting periods beginning after December 15, 2018, and interim reporting periods within annual reporting periods beginning after December 15, 2019. The SEC staff stated the SEC would not object to a public business entity that otherwise would not meet the definition of a public business entity except for a requirement to include or the inclusion of its financial statements or financialadditional information in another entity’s filing with the SEC adopting ASC Topic 842 for fiscal years beginning after December 15, 2019, and interim periods within fiscal years beginning after December 15, 2020. The Company is evaluating the provisions of ASU 2017-13 but believes that its adoption will not have a material impact on the Company's consolidated financial condition or results of operations.
In July 2017, the FASB issued Accounting Standards Update ("ASU") 2017-11, Earnings Per Share (Topic 260); Distinguishing Liabilities from Equity (Topic 480); Derivatives and Hedging (Topic 815): (Part I) Accounting for Certain Financial Instruments with Down Round Features, (Part II) Replacement of the Indefinite Deferral for Mandatorily Redeemable Financial Instruments of Certain Nonpublic Entities and Certain Mandatorily Redeemable Noncontrolling Interests with a Scope Exception. ASU 2017-11 amendments simplify theregarding our critical accounting for certain financial instruments with down round features. The amendments require companies to disregard the down round feature when assessing whether the instrument is indexed to its own stock, for purposes of determining liability or equity classification. Companies that provide earnings per share (EPS) data will adjust their basic EPS calculation for the effect of the feature when triggered and will also recognize the effect of the trigger within equity. ASU 2017-11 is effective for public business entities that are SEC filers for annual periods beginning after December 15, 2018, and interim periods within those annual periods, for public entities that are not SEC filers for annual periods beginning after December 15, 2019 and for all other entities for annual periods beginning after December 15, 2020 with early adoption permitted. The Company is evaluating the provisions of ASU 2017-11 but believes that its adoption will not have a material impact on the Company's consolidated financial condition or results of operations.
In May 2017, the FASB issued ASU 2017-10, Service Concession Arrangements (Topic 853): Determining the Customer of the Operation Services. ASU 2017-10 amendments clarify that the grantor in a service concession arrangement is the customer of the operation services in all cases for those arrangements. ASU 2017-10 is effective for public business entities that are SEC filers for annual periods beginning after December 15, 2017, and interim periods within those annual periods, for public entities that are not SEC filers for annual periods beginning after December 15, 2018 and for all other entities for annual periods beginning after December 15, 2019 with early adoption permitted, including within an interim period, subject to specific transition requirements depending on whether an entity adopted Topic 606 before or after the issuance of ASU 2017-10. The Company is evaluating the provisions of ASU 2017-10 but believes that its adoption will not have a material impact on the Company's consolidated financial condition or results of operations.
In May 2017, the FASB issued ASU 2017-09, Compensation—Stock Compensation (Topic 718): Scope of Modification Accounting. ASU 2017-09 amendments provide guidance on determining which changes to the terms and conditions of share-based payment awards require an entity to apply modification accounting under ASU Topic 718. ASU 2017-09 is effective for all entities for annual periods, including interim periods within those annual periods beginning after December 15, 2017 with early adoption permitted. The Company is evaluating the provisions of ASU 2017-09 but believes that its adoption will not have a material impact on the Company's consolidated financial condition or results of operations.
In March 2017, the FASB issued ASU 2017-08, Receivables- Nonrefundable Fees and Other Costs (Subtopic 310-20): Premium Amortization on Purchases of Callable Debt Securities. ASU 2017-08 amends guidance on the amortization period of premiums on certain purchases of callable debt securities. The amendments shorten the amortization period of premiums on certain purchases of callable debt securities to the earliest call date. ASU 2017-08 is effective for public business entities that are SEC filers for annual periods beginning after December 15, 2018, and interim periods within those annual periods, for
public entities that are not SEC filers for annual periods beginning after December 15, 2019 and for all other entities for annual periods beginning after December 15, 2020 with early adoption permitted. The Company is evaluating the provisions of ASU 2017-08 but believes that its adoption will not have a material impact on the Company's consolidated financial condition or results of operations.
In AugustSeptember 2016, the FASB issued ASU 2016-15, Statement of Cash Flow (Topic 230): Classification of Certain Cash Receipts and Cash Payments. ASU 2016-15 addresses the following eight specific cash flow issues: debt prepayment or debt extinguishment costs; settlement of zero-coupon debt instruments or other debt instruments with coupon interest rates that are insignificant in relation to the effective interest rate of the borrowing; contingent consideration payments made after a business combination; proceeds from the settlement of insurance claims; proceeds from the settlement of corporate-owned life insurance policies, including bank-owned life insurance policies; distributions received from equity method investees; beneficial interests in securitization transactions; and separately identifiable cash flows and application of the predominance principle. ASU 2016-15 is effective for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. Early adoption is permitted and the amendments should be applied using a retrospective transition method to each period presented. The Company is currently evaluating the provisions of ASU 2016-15, but does not believe that its adoption will have a material impact on the Company's consolidated financial condition or results of operations.
In June 2016, the FASB issued ASU 2016-13,
In March 2016, the FASB issued ASU 2016-09, Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting. ASU 2016-09 introduces amendments intended to simplify the accounting for stock compensation. ASU 2016-09 requires all excess tax benefits and tax deficiencies to be recognized as income tax expense or benefit in the income statement. The tax effects of exercised or vested awards should be treated as discrete items in the reporting period in which they occur. An entity should also recognize excess tax benefits and assess the need for a valuation allowance, regardless of whether the benefit reduces taxes payable in the current period. The ASU also requires excess tax benefits be classified along with other income tax cash flows as an operating activity in the statement of cash flows. ASU 2016-09 is effective for annual periods beginning after December 15, 2016, and interim periods within those annual periods, with early adoption permitted. The adoption of ASU 2016-09 as of January 1, 2017, had no effect on the Company's consolidated financial condition or results of operations.
Recent Accounting Standards (continued)
In February 2016, the FASB issued Accounting Standards Update (“ASU”) 2016-02, Leases (Topic 842), which increases the transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet, and disclosing key information about leasing arrangements. ASU 2016-02 will require lessees to recognize a right-of-use (ROU) asset for its right to use the underlying asset and a lease liability for the corresponding lease obligation for leases with terms of more than twelve months. Both the ROU asset and lease liability will initially be measured at the present value of the future minimum lease payments over the lease term. Subsequent measurement, including the presentation of expenses and cash flows, will depend on the classification of the lease as either a finance or an operating lease. Accounting by lessors will remain largely unchanged from current U.S. GAAP. ASU 2016-02 is effective for fiscal years beginning after December 15, 2018, and interim periods within those years, with early adoption permitted, and is to be applied as of the beginning of the earliest period presented using a modified retrospective approach. The Company is currently evaluating the provisions of ASU 2016-02, but expects to report increased assets and liabilities as a result of reporting additional leases on the Company's consolidated statement of financial condition or results of operations.
In January 2016, the FASB issued ASU 2016-01, Financial Instruments – Overall (Subtopic 825-10), which enhances the reporting model for financial instruments regarding certain aspects of recognition, measurement, presentation, and disclosure. ASU 2016-01 (i) requires equity investments (except those accounted for under the equity method or that are consolidated) to be measured at fair value with changes in fair value recognized in net income; (ii) simplifies the impairment assessment of equity investments without readily determinable fair values by requiring a qualitative assessment to identify impairment; (iii) eliminates the requirement for an entity to disclose the methods and significant assumptions used to estimate the fair value of financial instruments measured at amortized cost; (iv) requires an entity to use the exit price notion when measuring the fair value of financial instruments for disclosure purposes; and (v) requires separate presentation of financial assets and financial liabilities by measurement category and form of financial asset on the balance sheet or in the accompanying notes to the financial statements. ASU 2016-01 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2017, and is to be applied using a cumulative-effect adjustment to the balance sheet as of the beginning of the fiscal year of adoption. The Company is currently evaluating the provisions of ASU 2016-01, but does not believe that its adoption will have a material impact on the Company's consolidated financial condition or results of operations.
In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers, which establishes a comprehensive revenue recognition standard for virtually all industries under GAAP, including those that previously followed industry-specific guidance, such as the real estate, construction and software industries. ASU 2014-09 specifies that an entity shall recognize revenue when, or as, the entity satisfies a performance obligation by transferring a promised good or service (i.e., an asset) to a customer. An asset is transferred when, or as, the customer obtains control of the asset. Entities are required to disclose qualitative and quantitative information on the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. In August 2015, the FASB issued ASU 2015-14, which defers the effective date of ASU 2014-09. The guidance is effective for the Company’s financial statements beginning January 1, 2018. The guidance allows an entity to apply the new standard either retrospectively or through a cumulative effect adjustment as of January 1, 2018. This guidance does not apply to revenue associated with financial instruments, including loans, securities, and derivatives that are accounted for under other U.S. GAAP guidance. For that reason, we do not expect it to have a material impact on our consolidated results of operations for elements of the statement of income associated with financial instruments, including securities gains, interest income, and interest expense. However, we do believe the new standard will result in new disclosure requirements. We are currently in the process of reviewing contracts to assess the impact of the new guidance on our service offerings that are in the scope of the guidance included in non-interest income, such as insurance commission fees, deposit related fees and service charges, payment processing fees, trust services fees and brokerage services fees. The Company is continuing to evaluate the effect of the new guidance on revenue sources other than financial instruments on its consolidated financial position or results of operations and will use modified retrospective method for transition in which the cumulative effect will be recognized at the date of adoption with no restatement of comparative periods presented.
Note 2. Earnings PerPer Share
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2017 | 2016 | 2017 | 2016 | |||||||||||||
Weighted-Average Common Shares Outstanding | 4,363,346 | 4,363,346 | 4,363,346 | 4,363,346 | ||||||||||||
Average Treasury Stock Shares | (275,321 | ) | (282,329 | ) | (275,563 | ) | (282,329 | ) | ||||||||
Weighted-Average Common Shares and Common Stock Equivalents Used to Calculate Basic Earnings Per Share | 4,088,025 | 4,081,017 | 4,087,783 | 4,081,017 | ||||||||||||
Additional Common Stock Equivalents (Stock Options and Restricted Stock) Used to Calculate Diluted Earnings Per Share | 20,698 | 6,320 | 16,374 | 3,713 | ||||||||||||
Weighted-Average Common Shares and Common Stock Equivalents Used to Calculate Diluted Earnings Per Share | 4,108,723 | 4,087,337 | 4,104,157 | 4,084,730 | ||||||||||||
Earnings per share: | ||||||||||||||||
Basic | $ | 0.50 | $ | 0.38 | $ | 1.36 | $ | 1.36 | ||||||||
Diluted | 0.50 | 0.38 | 1.36 | 1.36 |
Three Months Ended March 31, | |||||||||||||||||
2022 | 2021 | ||||||||||||||||
(Dollars in thousands, except share and per share data) | |||||||||||||||||
Net Income | $ | 3,047 | $ | 2,845 | |||||||||||||
Weighted-Average Basic Common Shares Outstanding | 5,198,194 | 5,434,374 | |||||||||||||||
Dilutive Effect of Common Stock Equivalents (Stock Options and Restricted Stock) | 22,693 | 2,507 | |||||||||||||||
Weighted-Average Diluted Common Shares and Common Stock Equivalents Outstanding | 5,220,887 | 5,436,881 | |||||||||||||||
Earnings Per Share: | |||||||||||||||||
Basic | $ | 0.59 | $ | 0.52 | |||||||||||||
Diluted | 0.58 | 0.52 |
Three Months Ended
March 31,2022 2021 Stock Options 155,138 201,662 Restricted Stock 37,865 33,610
(Dollars in thousands) | ||||||||||||||||||||||||||||||
September 30, 2017 | March 31, 2022 | |||||||||||||||||||||||||||||
Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | |||||||||||||||||||||||
(Dollars in thousands) | (Dollars in thousands) | |||||||||||||||||||||||||||||
Available-for-Sale Debt Securities: | Available-for-Sale Debt Securities: | |||||||||||||||||||||||||||||
U.S. Government Agencies | $ | 59,622 | $ | - | $ | (1,242 | ) | $ | 58,380 | U.S. Government Agencies | $ | 53,992 | $ | — | $ | (4,781) | $ | 49,211 | ||||||||||||
Obligations of States and Political Subdivisions | 37,616 | 314 | (122 | ) | 37,808 | Obligations of States and Political Subdivisions | 17,946 | 448 | (1) | 18,393 | ||||||||||||||||||||
Mortgage-Backed Securities - Government-Sponsored Enterprises | 17,890 | 14 | (45 | ) | 17,859 | Mortgage-Backed Securities - Government-Sponsored Enterprises | 52,505 | 177 | (2,063) | 50,619 | ||||||||||||||||||||
Equity Securities - Mutual Funds | 500 | 10 | - | 510 | ||||||||||||||||||||||||||
Equity Securities - Other | 1,253 | 94 | (15 | ) | 1,332 | |||||||||||||||||||||||||
Total | $ | 116,881 | $ | 432 | $ | (1,424 | ) | $ | 115,889 | |||||||||||||||||||||
Collateralized Mortgage Obligations - Government Sponsored Enterprises | Collateralized Mortgage Obligations - Government Sponsored Enterprises | 107,848 | 2 | (7,042) | 100,808 | |||||||||||||||||||||||||
Corporate Debt | Corporate Debt | 9,480 | — | (273) | 9,207 | |||||||||||||||||||||||||
Total Available-for-Sale Debt Securities | Total Available-for-Sale Debt Securities | 241,771 | 627 | (14,160) | 228,238 | |||||||||||||||||||||||||
Equity Securities: | Equity Securities: | |||||||||||||||||||||||||||||
Mutual Funds | Mutual Funds | 944 | ||||||||||||||||||||||||||||
Other | Other | 1,915 | ||||||||||||||||||||||||||||
Total Equity Securities | Total Equity Securities | 2,859 | ||||||||||||||||||||||||||||
Total Securities | Total Securities | $ | 231,097 |
December 31, 2021 | ||||||||||||||
Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | |||||||||||
(Dollars in thousands) | ||||||||||||||
Available-for-Sale Debt Securities: | ||||||||||||||
U.S. Government Agencies | $ | 53,992 | $ | 2 | $ | (1,433) | $ | 52,561 | ||||||
Obligations of States and Political Subdivisions | 17,951 | 1,004 | — | 18,955 | ||||||||||
Mortgage-Backed Securities - Government-Sponsored Enterprises | 55,373 | 1,468 | (282) | 56,559 | ||||||||||
Collateralized Mortgage Obligations - Government Sponsored Enterprises | 88,493 | 164 | (2,074) | 86,583 | ||||||||||
Corporate Debt | 7,481 | — | (31) | 7,450 | ||||||||||
Total Available-for-Sale Debt Securities | 223,290 | 2,638 | (3,820) | 222,108 | ||||||||||
Equity Securities: | ||||||||||||||
Mutual Funds | 990 | |||||||||||||
Other | 1,876 | |||||||||||||
Total Equity Securities | 2,866 | |||||||||||||
Total Securities | $ | 224,974 |
December 31, 2016 | ||||||||||||||||
Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | |||||||||||||
U.S. Government Agencies | $ | 67,944 | $ | 18 | $ | (1,806 | ) | $ | 66,156 | |||||||
Obligations of States and Political Subdivisions | 35,856 | 366 | (487 | ) | 35,735 | |||||||||||
Mortgage-Backed Securities - Government-Sponsored Enterprises | 2,588 | 31 | - | 2,619 | ||||||||||||
Equity Securities - Mutual Funds | 500 | 7 | - | 507 | ||||||||||||
Equity Securities - Other | 1,106 | 91 | (6 | ) | 1,191 | |||||||||||
Total | $ | 107,994 | $ | 513 | $ | (2,299 | ) | $ | 106,208 |
The following tables show the Company’s gross unrealized losses and fair value, aggregated by investment category and length of time that the individual securities have been in a continuous unrealized loss position, at the dates indicated:
(Dollars in thousands) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
September 30, 2017 | March 31, 2022 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Less than 12 months | 12 Months or Greater | Total | Less than 12 months | 12 Months or Greater | Total | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Number of Securities | Fair Value | Gross Unrealized Losses | Number of Securities | Fair Value | Gross Unrealized Losses | Number of Securities | Fair Value | Gross Unrealized Losses | Number of Securities | Fair Value | Gross Unrealized Losses | Number of Securities | Fair Value | Gross Unrealized Losses | Number of Securities | Fair Value | Gross Unrealized Losses | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
(Dollars in thousands) | (Dollars in thousands) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
U.S. Government Agencies | 12 | $ | 33,733 | $ | (525 | ) | 9 | $ | 24,646 | $ | (717 | ) | 21 | $ | 58,379 | $ | (1,242 | ) | U.S. Government Agencies | 3 | $ | 11,226 | $ | (771) | 10 | $ | 37,985 | $ | (4,010) | 13 | $ | 49,211 | $ | (4,781) | |||||||||||||||||||||||||||||||||||||
Obligations of States and Political Subdivisions | 22 | 11,788 | (80 | ) | 7 | 3,489 | (42 | ) | 29 | 15,277 | (122 | ) | Obligations of States and Political Subdivisions | 2 | 1,070 | (1) | — | — | — | 2 | 1,070 | (1) | |||||||||||||||||||||||||||||||||||||||||||||||||
Mortgage-Backed Securities - Government Sponsored Enterprises | 4 | 9,191 | (45 | ) | - | - | - | 4 | 9,191 | (45 | ) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity Securities - Other | 6 | 483 | (15 | ) | - | - | - | 6 | 483 | (15 | ) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Mortgage Backed Securities- Government Sponsored Enterprises | Mortgage Backed Securities- Government Sponsored Enterprises | 17 | 29,175 | (1,745) | 1 | 3,395 | (318) | 18 | 32,570 | (2,063) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Collateralized Mortgage Obligations - Government Sponsored Enterprises | Collateralized Mortgage Obligations - Government Sponsored Enterprises | 20 | 100,559 | (7,042) | — | — | — | 20 | 100,559 | (7,042) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Corporate Debt | Corporate Debt | 3 | 9,208 | (273) | — | — | — | 3 | 9,208 | (273) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total | 44 | $ | 55,195 | $ | (665 | ) | 16 | $ | 28,135 | $ | (759 | ) | 60 | $ | 83,330 | $ | (1,424 | ) | Total | 45 | $ | 151,238 | $ | (9,832) | 11 | $ | 41,380 | $ | (4,328) | 56 | $ | 192,618 | $ | (14,160) | |||||||||||||||||||||||||||||||||||||
December 31, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Less than 12 months | 12 Months or Greater | Total | December 31, 2021 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Number of Securities | Fair Value | Gross Unrealized Losses | Number of Securities | Fair Value | Gross Unrealized Losses | Number of Securities | Fair Value | Gross Unrealized Losses | Less than 12 months | 12 Months or Greater | Total | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Number of Securities | Fair Value | Gross Unrealized Losses | Number of Securities | Fair Value | Gross Unrealized Losses | Number of Securities | Fair Value | Gross Unrealized Losses | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(Dollars in thousands) | (Dollars in thousands) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
U.S. Government Agencies | 23 | $ | 62,853 | $ | (1,806 | ) | - | $ | - | $ | - | 23 | $ | 62,853 | $ | (1,806 | ) | U.S. Government Agencies | 5 | $ | 17,729 | $ | (269) | 7 | $ | 31,830 | $ | (1,164) | 12 | $ | 49,559 | $ | (1,433) | ||||||||||||||||||||||||||||||||||||||
Obligations of States and Political Subdivisions | 39 | 19,749 | (485 | ) | 1 | 260 | (2 | ) | 40 | 20,009 | (487 | ) | Obligations of States and Political Subdivisions | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||
Equity Securities - Other | 2 | 160 | (6 | ) | - | - | - | 2 | 160 | (6 | ) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Mortgage Backed Securities- Government Sponsored Enterprises | Mortgage Backed Securities- Government Sponsored Enterprises | 8 | 28,772 | (282) | — | — | — | 8 | 28,772 | (282) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Collateralized Mortgage Obligations - Government Sponsored Enterprises | Collateralized Mortgage Obligations - Government Sponsored Enterprises | 10 | 77,560 | (2,074) | — | — | — | 10 | 77,560 | (2,074) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Corporate Debt | Corporate Debt | 2 | 7,450 | (31) | — | — | — | 2 | 7,450 | (31) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total | 64 | $ | 82,762 | $ | (2,297 | ) | 1 | $ | 260 | $ | (2 | ) | 65 | $ | 83,022 | $ | (2,299 | ) | Total | 25 | $ | 131,511 | $ | (2,656) | 7 | $ | 31,830 | $ | (1,164) | 32 | $ | 163,341 | $ | (3,820) |
(Dollars in thousands) | ||||||||||||||||
September 30, 2017 | March 31, 2022 | |||||||||||||||
Available-for-Sale | Amortized Cost | Fair Value | ||||||||||||||
(Dollars in thousands) | (Dollars in thousands) | |||||||||||||||
Amortized Cost | Fair Value | |||||||||||||||
Due in One Year or Less | $ | 2,115 | $ | 2,126 | Due in One Year or Less | $ | 2,576 | $ | 2,584 | |||||||
Due after One Year through Five Years | 23,469 | 23,443 | Due after One Year through Five Years | 4,900 | 4,690 | |||||||||||
Due after Five Years through Ten Years | 68,376 | 67,362 | Due after Five Years through Ten Years | 78,948 | 74,332 | |||||||||||
Due after Ten Years | 22,921 | 22,958 | Due after Ten Years | 155,347 | 146,632 | |||||||||||
Total | $ | 116,881 | $ | 115,889 | Total | $ | 241,771 | $ | 228,238 |
Equity
Three Months Ended March 31, | |||||||||||||||||
2022 | 2021 | ||||||||||||||||
(Dollars in thousands) | |||||||||||||||||
Debt Securities | |||||||||||||||||
Gross Realized Gain | $ | — | $ | 225 | |||||||||||||
Gross Realized Loss | — | — | |||||||||||||||
Net Gain on Debt Securities | $ | — | $ | 225 | |||||||||||||
Equity Securities | |||||||||||||||||
Net Unrealized (Loss) Gain Recognized on Securities Held | $ | (7) | $ | 222 | |||||||||||||
Net Realized Gain Recognized on Securities Sold | — | — | |||||||||||||||
Net (Loss) Gain on Equity Securities | $ | (7) | $ | 222 | |||||||||||||
Net (Loss) Gain on Securities | $ | (7) | $ | 447 |
Note 4. Loans and Related Allowance for Loan Loss
Losses
(Dollars in thousands) | ||||||||||||||||||||||||||||||
September 30, 2017 | December 31, 2016 | March 31, 2022 | December 31, 2021 | |||||||||||||||||||||||||||
Amount | Percent | Amount | Percent | Amount | Percent | Amount | Percent | |||||||||||||||||||||||
Originated Loans | ||||||||||||||||||||||||||||||
Real Estate: | ||||||||||||||||||||||||||||||
Residential | $ | 193,214 | 34.1 | % | $ | 186,077 | 35.4 | % | ||||||||||||||||||||||
Commercial | 150,442 | 26.5 | 139,894 | 26.7 | ||||||||||||||||||||||||||
Construction | 28,965 | 5.1 | 10,646 | 2.0 | ||||||||||||||||||||||||||
Commercial and Industrial | 77,217 | 13.6 | 71,091 | 13.5 | ||||||||||||||||||||||||||
Consumer | 113,822 | 20.1 | 114,007 | 21.7 | ||||||||||||||||||||||||||
Other | 3,444 | 0.6 | 3,637 | 0.7 | ||||||||||||||||||||||||||
Total Originated Loans | 567,104 | 100.0 | % | 525,352 | 100.0 | % | ||||||||||||||||||||||||
Allowance for Loan Losses | (7,573 | ) | (7,283 | ) | ||||||||||||||||||||||||||
Loans, Net | $ | 559,531 | $ | 518,069 | ||||||||||||||||||||||||||
(Dollars in thousands) | (Dollars in thousands) | |||||||||||||||||||||||||||||
Loans Acquired at Fair Value | ||||||||||||||||||||||||||||||
Real Estate: | ||||||||||||||||||||||||||||||
Residential | $ | 75,217 | 55.0 | % | $ | 85,511 | 54.7 | % | ||||||||||||||||||||||
Commercial | 52,826 | 38.7 | 61,116 | 39.0 | ||||||||||||||||||||||||||
Commercial and Industrial | 8,532 | 6.2 | 9,721 | 6.2 | ||||||||||||||||||||||||||
Consumer | 195 | 0.1 | 197 | 0.1 | ||||||||||||||||||||||||||
Total Loans Acquired at Fair Value | 136,770 | 100.0 | % | 156,545 | 100.0 | % | ||||||||||||||||||||||||
Allowance for Loan Losses | (583 | ) | (520 | ) | ||||||||||||||||||||||||||
Loans, Net | $ | 136,187 | $ | 156,025 | ||||||||||||||||||||||||||
Total Loans | ||||||||||||||||||||||||||||||
Real Estate: | Real Estate: | |||||||||||||||||||||||||||||
Residential | $ | 268,431 | 38.1 | % | $ | 271,588 | 39.8 | % | Residential | $ | 317,254 | 31.1 | % | $ | 320,798 | 31.4 | % | |||||||||||||
Commercial | 203,268 | 28.9 | 201,010 | 29.5 | Commercial | 427,227 | 41.9 | 392,124 | 38.5 | |||||||||||||||||||||
Construction | 28,965 | 4.1 | 10,646 | 1.6 | Construction | 54,227 | 5.3 | 85,028 | 8.3 | |||||||||||||||||||||
Commercial and Industrial | 85,749 | 12.2 | 80,812 | 11.9 | Commercial and Industrial | 67,843 | 6.6 | 89,010 | 8.7 | |||||||||||||||||||||
Consumer | 114,017 | 16.2 | 114,204 | 16.7 | Consumer | 143,422 | 14.1 | 122,152 | 12.0 | |||||||||||||||||||||
Other | 3,444 | 0.5 | 3,637 | 0.5 | Other | 10,669 | 1.0 | 11,684 | 1.1 | |||||||||||||||||||||
Total Loans | 703,874 | 100.0 | % | 681,897 | 100.0 | % | Total Loans | 1,020,642 | 100.0 | % | 1,020,796 | 100.0 | % | |||||||||||||||||
Allowance for Loan Losses | (8,156 | ) | (7,803 | ) | Allowance for Loan Losses | (11,595) | (11,582) | |||||||||||||||||||||||
Loans, Net | $ | 695,718 | $ | 674,094 | Loans, Net | $ | 1,009,047 | $ | 1,009,214 |
Real estate loans serviced for others, which
(Dollars in thousands) | ||||||||||||||||||||
September 30, 2017 | ||||||||||||||||||||
Pass | Special Mention | Substandard | Doubtful | Total | ||||||||||||||||
Originated Loans | ||||||||||||||||||||
Real Estate: | ||||||||||||||||||||
Residential | $ | 191,801 | $ | 1,006 | $ | 407 | $ | - | $ | 193,214 | ||||||||||
Commercial | 133,529 | 13,909 | 2,467 | 537 | 150,442 | |||||||||||||||
Construction | 28,356 | - | 550 | 59 | 28,965 | |||||||||||||||
Commercial and Industrial | 66,415 | 8,326 | 1,111 | 1,365 | 77,217 | |||||||||||||||
Consumer | 113,795 | - | 27 | - | 113,822 | |||||||||||||||
Other | 3,444 | - | - | - | 3,444 | |||||||||||||||
Total Originated Loans | $ | 537,340 | $ | 23,241 | $ | 4,562 | $ | 1,961 | $ | 567,104 | ||||||||||
Loans Acquired at Fair Value | ||||||||||||||||||||
Real Estate: | ||||||||||||||||||||
Residential | $ | 73,213 | $ | - | $ | 2,004 | $ | - | $ | 75,217 | ||||||||||
Commercial | 50,381 | 1,939 | 506 | - | 52,826 | |||||||||||||||
Commercial and Industrial | 8,176 | 9 | 263 | 84 | 8,532 | |||||||||||||||
Consumer | 195 | - | - | - | 195 | |||||||||||||||
Total Loans Acquired at Fair Value | $ | 131,965 | $ | 1,948 | $ | 2,773 | $ | 84 | $ | 136,770 | ||||||||||
Total Loans | ||||||||||||||||||||
Real Estate: | ||||||||||||||||||||
Residential | $ | 265,014 | $ | 1,006 | $ | 2,411 | $ | - | $ | 268,431 | ||||||||||
Commercial | 183,910 | 15,848 | 2,973 | 537 | 203,268 | |||||||||||||||
Construction | 28,356 | - | 550 | 59 | 28,965 | |||||||||||||||
Commercial and Industrial | 74,591 | 8,335 | 1,374 | 1,449 | 85,749 | |||||||||||||||
Consumer | 113,990 | - | 27 | - | 114,017 | |||||||||||||||
Other | 3,444 | - | - | - | 3,444 | |||||||||||||||
Total Loans | $ | 669,305 | $ | 25,189 | $ | 7,335 | $ | 2,045 | $ | 703,874 |
December 31, 2016 | ||||||||||||||||||||
Pass | Special Mention | Substandard | Doubtful | Total | ||||||||||||||||
Originated Loans | ||||||||||||||||||||
Real Estate: | ||||||||||||||||||||
Residential | $ | 184,721 | $ | 1,050 | $ | 306 | $ | - | $ | 186,077 | ||||||||||
Commercial | 122,811 | 14,118 | 2,035 | 930 | 139,894 | |||||||||||||||
Construction | 9,944 | - | 595 | 107 | 10,646 | |||||||||||||||
Commercial and Industrial | 65,612 | 2,720 | 1,322 | 1,437 | 71,091 | |||||||||||||||
Consumer | 113,847 | - | 160 | - | 114,007 | |||||||||||||||
Other | 3,637 | - | - | - | 3,637 | |||||||||||||||
Total Originated Loans | $ | 500,572 | $ | 17,888 | $ | 4,418 | $ | 2,474 | $ | 525,352 | ||||||||||
Loans Acquired at Fair Value | ||||||||||||||||||||
Real Estate: | ||||||||||||||||||||
Residential | $ | 83,044 | $ | - | $ | 2,467 | $ | - | $ | 85,511 | ||||||||||
Commercial | 58,411 | 2,358 | 347 | - | 61,116 | |||||||||||||||
Commercial and Industrial | 9,117 | 42 | 441 | 121 | 9,721 | |||||||||||||||
Consumer | 197 | - | - | - | 197 | |||||||||||||||
Total Loans Acquired at Fair Value | $ | 150,769 | $ | 2,400 | $ | 3,255 | $ | 121 | $ | 156,545 | ||||||||||
Total Loans | ||||||||||||||||||||
Real Estate: | ||||||||||||||||||||
Residential | $ | 267,765 | $ | 1,050 | $ | 2,773 | $ | - | $ | 271,588 | ||||||||||
Commercial | 181,222 | 16,476 | 2,382 | 930 | 201,010 | |||||||||||||||
Construction | 9,944 | - | 595 | 107 | 10,646 | |||||||||||||||
Commercial and Industrial | 74,729 | 2,762 | 1,763 | 1,558 | 80,812 | |||||||||||||||
Consumer | 114,044 | - | 160 | - | 114,204 | |||||||||||||||
Other | 3,637 | - | - | - | 3,637 | |||||||||||||||
Total Loans | $ | 651,341 | $ | 20,288 | $ | 7,673 | $ | 2,595 | $ | 681,897 |
March 31, 2022 | |||||||||||||||||
Pass | Special Mention | Substandard | Doubtful | Total | |||||||||||||
(Dollars in Thousands) | |||||||||||||||||
Real Estate: | |||||||||||||||||
Residential | $ | 314,174 | $ | 839 | $ | 2,241 | $ | — | $ | 317,254 | |||||||
Commercial | 390,395 | 28,217 | 8,615 | — | 427,227 | ||||||||||||
Construction | 38,724 | 12,971 | 2,532 | — | 54,227 | ||||||||||||
Commercial and Industrial | 54,085 | 11,774 | 1,400 | 584 | 67,843 | ||||||||||||
Consumer | 143,326 | — | 96 | — | 143,422 | ||||||||||||
Other | 10,603 | 66 | — | — | 10,669 | ||||||||||||
Total Loans | $ | 951,307 | $ | 53,867 | $ | 14,884 | $ | 584 | $ | 1,020,642 |
December 31, 2021 | |||||||||||||||||
Pass | Special Mention | Substandard | Doubtful | Total | |||||||||||||
(Dollars in Thousands) | |||||||||||||||||
Real Estate: | |||||||||||||||||
Residential | $ | 317,964 | $ | 845 | $ | 1,989 | $ | — | $ | 320,798 | |||||||
Commercial | 355,895 | 27,168 | 9,061 | — | 392,124 | ||||||||||||
Construction | 69,441 | 13,035 | 2,552 | — | 85,028 | ||||||||||||
Commercial and Industrial | 72,584 | 14,463 | 1,451 | 512 | 89,010 | ||||||||||||
Consumer | 122,136 | — | 16 | — | 122,152 | ||||||||||||
Other | 11,616 | 68 | — | — | 11,684 | ||||||||||||
Total Loans | $ | 949,636 | $ | 55,579 | $ | 15,069 | $ | 512 | $ | 1,020,796 |
(Dollars in thousands) | |||||||||||||||||||||||||||||||||||||||||||||||||||
September 30, 2017 | March 31, 2022 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Loans Current | 30-59 Days Past Due | 60-89 Days Past Due | 90 Days Or More Past Due | Total Past Due | Non- Accrual | Total Loans | Loans Current | 30-59 Days Past Due | 60-89 Days Past Due | 90 Days Or More Past Due | Total Past Due | Non- Accrual | Total Loans | ||||||||||||||||||||||||||||||||||||||
Originated Loans | |||||||||||||||||||||||||||||||||||||||||||||||||||
Real Estate: | |||||||||||||||||||||||||||||||||||||||||||||||||||
Residential | $ | 192,769 | $ | 91 | $ | 42 | $ | - | $ | 133 | $ | 312 | $ | 193,214 | |||||||||||||||||||||||||||||||||||||
Commercial | 150,154 | - | - | - | - | 288 | 150,442 | ||||||||||||||||||||||||||||||||||||||||||||
Construction | 28,906 | - | - | - | - | 59 | 28,965 | ||||||||||||||||||||||||||||||||||||||||||||
Commercial and Industrial | 75,108 | - | - | 496 | 496 | 1,613 | 77,217 | ||||||||||||||||||||||||||||||||||||||||||||
Consumer | 112,485 | 1,155 | 103 | 52 | 1,310 | 27 | 113,822 | ||||||||||||||||||||||||||||||||||||||||||||
Other | 3,444 | - | - | - | - | - | 3,444 | ||||||||||||||||||||||||||||||||||||||||||||
Total Originated Loans | $ | 562,866 | $ | 1,246 | $ | 145 | $ | 548 | $ | 1,939 | $ | 2,299 | $ | 567,104 | |||||||||||||||||||||||||||||||||||||
(Dollars in Thousands) | (Dollars in Thousands) | ||||||||||||||||||||||||||||||||||||||||||||||||||
Loans Acquired at Fair Value | |||||||||||||||||||||||||||||||||||||||||||||||||||
Real Estate: | |||||||||||||||||||||||||||||||||||||||||||||||||||
Residential | $ | 73,977 | $ | 45 | $ | - | $ | 75 | $ | 120 | $ | 1,120 | $ | 75,217 | |||||||||||||||||||||||||||||||||||||
Commercial | 52,826 | - | - | - | - | - | 52,826 | ||||||||||||||||||||||||||||||||||||||||||||
Commercial and Industrial | 8,516 | - | - | - | - | 16 | 8,532 | ||||||||||||||||||||||||||||||||||||||||||||
Consumer | 190 | 5 | - | - | 5 | - | 195 | ||||||||||||||||||||||||||||||||||||||||||||
Total Loans Acquired at Fair Value | $ | 135,509 | $ | 50 | $ | - | $ | 75 | $ | 125 | $ | 1,136 | $ | 136,770 | |||||||||||||||||||||||||||||||||||||
Total Loans | |||||||||||||||||||||||||||||||||||||||||||||||||||
Real Estate: | Real Estate: | ||||||||||||||||||||||||||||||||||||||||||||||||||
Residential | $ | 266,746 | $ | 136 | $ | 42 | $ | 75 | $ | 253 | $ | 1,432 | $ | 268,431 | Residential | $ | 313,306 | $ | 2,106 | $ | 191 | $ | — | $ | 2,297 | $ | 1,651 | $ | 317,254 | ||||||||||||||||||||||
Commercial | 202,980 | - | - | - | - | 288 | 203,268 | Commercial | 425,202 | — | — | — | — | 2,025 | 427,227 | ||||||||||||||||||||||||||||||||||||
Construction | 28,906 | - | - | - | - | 59 | 28,965 | Construction | 54,227 | — | — | — | — | — | 54,227 | ||||||||||||||||||||||||||||||||||||
Commercial and Industrial | 83,624 | - | - | 496 | 496 | 1,629 | 85,749 | Commercial and Industrial | 66,202 | 101 | — | — | 101 | 1,540 | 67,843 | ||||||||||||||||||||||||||||||||||||
Consumer | 112,675 | 1,160 | 103 | 52 | 1,315 | 27 | 114,017 | Consumer | 142,931 | 338 | 57 | — | 395 | 96 | 143,422 | ||||||||||||||||||||||||||||||||||||
Other | 3,444 | - | - | - | - | - | 3,444 | Other | 10,669 | — | — | — | — | — | 10,669 | ||||||||||||||||||||||||||||||||||||
Total Loans | $ | 698,375 | $ | 1,296 | $ | 145 | $ | 623 | $ | 2,064 | $ | 3,435 | $ | 703,874 | Total Loans | $ | 1,012,537 | $ | 2,545 | $ | 248 | $ | — | $ | 2,793 | $ | 5,312 | $ | 1,020,642 |
December 31, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Loans Current | 30-59 Days Past Due | 60-89 Days Past Due | 90 Days Or More Past Due | Total Past Due | Non- Accrual | Total Loans | December 31, 2021 | ||||||||||||||||||||||||||||||||||||||||||||
Originated Loans | |||||||||||||||||||||||||||||||||||||||||||||||||||
Real Estate: | |||||||||||||||||||||||||||||||||||||||||||||||||||
Residential | $ | 183,939 | $ | 1,638 | $ | 72 | $ | 120 | $ | 1,830 | $ | 308 | $ | 186,077 | |||||||||||||||||||||||||||||||||||||
Commercial | 139,821 | - | - | - | - | 73 | 139,894 | ||||||||||||||||||||||||||||||||||||||||||||
Construction | 10,539 | - | - | - | - | 107 | 10,646 | ||||||||||||||||||||||||||||||||||||||||||||
Commercial and Industrial | 68,310 | 952 | - | - | 952 | 1,829 | 71,091 | ||||||||||||||||||||||||||||||||||||||||||||
Consumer | 112,232 | 1,311 | 296 | 8 | 1,615 | 160 | 114,007 | ||||||||||||||||||||||||||||||||||||||||||||
Other | 3,637 | - | - | - | - | - | 3,637 | ||||||||||||||||||||||||||||||||||||||||||||
Total Originated Loans | $ | 518,478 | $ | 3,901 | $ | 368 | $ | 128 | $ | 4,397 | $ | 2,477 | $ | 525,352 | |||||||||||||||||||||||||||||||||||||
Loans Current | 30-59 Days Past Due | 60-89 Days Past Due | 90 Days Or More Past Due | Total Past Due | Non- Accrual | Total Loans | |||||||||||||||||||||||||||||||||||||||||||||
Loans Acquired at Fair Value | |||||||||||||||||||||||||||||||||||||||||||||||||||
Real Estate: | |||||||||||||||||||||||||||||||||||||||||||||||||||
Residential | $ | 82,523 | $ | 893 | $ | 307 | $ | 223 | $ | 1,423 | $ | 1,565 | $ | 85,511 | |||||||||||||||||||||||||||||||||||||
Commercial | 60,437 | 332 | - | - | 332 | 347 | 61,116 | ||||||||||||||||||||||||||||||||||||||||||||
Commercial and Industrial | 9,577 | 121 | 23 | - | 144 | - | 9,721 | ||||||||||||||||||||||||||||||||||||||||||||
Consumer | 197 | - | - | - | - | - | 197 | ||||||||||||||||||||||||||||||||||||||||||||
Total Loans Acquired at Fair Value | $ | 152,734 | $ | 1,346 | $ | 330 | $ | 223 | $ | 1,899 | $ | 1,912 | $ | 156,545 | |||||||||||||||||||||||||||||||||||||
(Dollars in Thousands) | (Dollars in Thousands) | ||||||||||||||||||||||||||||||||||||||||||||||||||
Total Loans | |||||||||||||||||||||||||||||||||||||||||||||||||||
Real Estate: | Real Estate: | ||||||||||||||||||||||||||||||||||||||||||||||||||
Residential | $ | 266,462 | $ | 2,531 | $ | 379 | $ | 343 | $ | 3,253 | $ | 1,873 | $ | 271,588 | Residential | $ | 317,583 | $ | 1,805 | $ | 17 | $ | — | $ | 1,822 | $ | 1,393 | $ | 320,798 | ||||||||||||||||||||||
Commercial | 200,258 | 332 | - | - | 332 | 420 | 201,010 | Commercial | 389,522 | 544 | — | — | 544 | 2,058 | 392,124 | ||||||||||||||||||||||||||||||||||||
Construction | 10,539 | - | - | - | - | 107 | 10,646 | Construction | 85,028 | — | — | — | — | — | 85,028 | ||||||||||||||||||||||||||||||||||||
Commercial and Industrial | 77,887 | 1,073 | 23 | - | 1,096 | 1,829 | 80,812 | Commercial and Industrial | 87,407 | 107 | — | — | 107 | 1,496 | 89,010 | ||||||||||||||||||||||||||||||||||||
Consumer | 112,429 | 1,311 | 296 | 8 | 1,615 | 160 | 114,204 | Consumer | 121,636 | 419 | 81 | — | 500 | 16 | 122,152 | ||||||||||||||||||||||||||||||||||||
Other | 3,637 | - | - | - | - | - | 3,637 | Other | 11,684 | — | — | — | — | — | 11,684 | ||||||||||||||||||||||||||||||||||||
Total Loans | $ | 671,212 | $ | 5,247 | $ | 698 | $ | 351 | $ | 6,296 | $ | 4,389 | $ | 681,897 | Total Loans | $ | 1,012,860 | $ | 2,875 | $ | 98 | $ | — | $ | 2,973 | $ | 4,963 | $ | 1,020,796 |
(Dollars in Thousands) | ||||||||
September 30, 2017 | December 31, 2016 | |||||||
Nonaccrual Loans: | ||||||||
Originated Loans: | ||||||||
Real Estate: | ||||||||
Residential | $ | 312 | $ | 308 | ||||
Commercial | 288 | 73 | ||||||
Construction | 59 | 107 | ||||||
Commercial and Industrial | 1,613 | 1,829 | ||||||
Consumer | 27 | 160 | ||||||
Total Originated Nonaccrual Loans | 2,299 | 2,477 | ||||||
Loans Acquired at Fair Value: | ||||||||
Real Estate: | ||||||||
Residential | 1,120 | 1,565 | ||||||
Commercial | - | 347 | ||||||
Commercial and Industrial | 16 | - | ||||||
Total Loans Acquired at Fair Value Nonaccrual Loans | 1,136 | 1,912 | ||||||
Total Nonaccrual Loans | 3,435 | 4,389 | ||||||
Accruing Loans Past Due 90 Days or More: | ||||||||
Originated Loans: | ||||||||
Real Estate: | ||||||||
Residential | - | 120 | ||||||
Commercial and Industrial | 496 | - | ||||||
Consumer | 52 | 8 | ||||||
Total Originated Accruing Loans 90 Days or More Past Due | 548 | 128 | ||||||
Loans Acquired at Fair Value: | ||||||||
Real Estate: | ||||||||
Residential | 75 | 223 | ||||||
Total Loans Acquired at Fair Value Accruing Loans 90 Days or More Past Due | 75 | 223 | ||||||
Total Accruing Loans 90 Days or More Past Due | 623 | 351 | ||||||
Total Nonaccrual Loans and Accruing Loans 90 Days or More Past Due | 4,058 | 4,740 | ||||||
Troubled Debt Restructurings, Accruing: | ||||||||
Originated Loans: | ||||||||
Real Estate - Residential | 61 | - | ||||||
Real Estate - Commercial | 1,285 | 1,325 | ||||||
Commercial and Industrial | 5 | 6 | ||||||
Other | 2 | 4 | ||||||
Total Originated Loans | 1,353 | 1,335 | ||||||
Loans Acquired at Fair Value: | ||||||||
Real Estate - Residential | 1,268 | 1,299 | ||||||
Real Estate - Commercial | 438 | 660 | ||||||
Commercial and Industrial | 247 | 393 | ||||||
Total Loans Acquired at Fair Value | 1,953 | 2,352 | ||||||
Total Troubled Debt Restructurings, Accruing | 3,306 | 3,687 | ||||||
Total Nonperforming Loans | 7,364 | 8,427 | ||||||
Real Estate Owned: | ||||||||
Residential | 236 | - | ||||||
Commercial | 174 | 174 | ||||||
Total Real Estate Owned | 410 | 174 | ||||||
Total Nonperforming Assets | $ | 7,774 | $ | 8,601 | ||||
Nonperforming Loans to Total Loans | 1.05 | % | 1.24 | % | ||||
Nonperforming Assets to Total Assets | 0.86 | 1.02 |
March 31, 2022 | December 31, 2021 | |||||||
(Dollars in Thousands) | ||||||||
Nonaccrual Loans: | ||||||||
Real Estate: | ||||||||
Residential | $ | 1,651 | $ | 1,393 | ||||
Commercial | 2,025 | 2,058 | ||||||
Construction | — | — | ||||||
Commercial and Industrial | 1,540 | 1,496 | ||||||
Consumer | 96 | 16 | ||||||
Total Nonaccrual Loans | 5,312 | 4,963 | ||||||
Accruing Loans Past Due 90 Days or More: | ||||||||
Consumer | — | — | ||||||
Total Accruing Loans Past Due 90 Days or More | — | — | ||||||
Total Nonaccrual Loans and Accruing Loans Past Due 90 Days or More | 5,312 | 4,963 | ||||||
Troubled Debt Restructurings, Accruing: | ||||||||
Real Estate | ||||||||
Residential | 603 | 613 | ||||||
Commercial | 1,371 | 1,674 | ||||||
Commercial and Industrial | 12 | 16 | ||||||
Total Troubled Debt Restructurings, Accruing | 1,986 | 2,303 | ||||||
Total Nonperforming Loans | 7,298 | 7,266 | ||||||
Other Real Estate Owned: | ||||||||
Residential | — | 36 | ||||||
Commercial | — | — | ||||||
Total Other Real Estate Owned | — | 36 | ||||||
Total Nonperforming Assets | $ | 7,298 | $ | 7,302 | ||||
Nonperforming Loans to Total Loans | 0.72 | % | 0.71 | % | ||||
Nonperforming Assets to Total Assets | 0.51 | 0.51 |
TDRs typically are
During the three and nine months ended September 30, 2017, one residential real estate loan modified terms in a new TDR transaction. During the nine months ended September 30, 2016, one commercial loan previously identified as an acquired loan at fair value TDR paid off, an originated consumer loan modified terms in a new TDR transaction, and one commercial and one residential real estate loan that were acquired at fair value modified terms into new TDR transactions. No loans were modified in a TDRtroubled debt restructurings during the three months ended September 30, 2016. No TDRs subsequently defaulted during the three or nine months ended September 30, 2017 and 2016, respectively.
The following table presents information at the timeMarch 31, 2022. As of modification related toDecember 31, 2021, there were no loans modified in a TDR during the three and nine months ended September 30, 2017 and nine months ended September 30, 2016.
(Dollars in thousands) | ||||||||||||||||
Three Months Ended September 30, 2017 | ||||||||||||||||
Number of Contracts | Pre- Modification Outstanding Recorded Investment | Post- Modification Outstanding Recorded Investment | Related Allowance | |||||||||||||
Originated Loans | ||||||||||||||||
Real Estate | ||||||||||||||||
Residential | 1 | $ | 61 | $ | 61 | $ | - | |||||||||
Total | 1 | $ | 61 | $ | 61 | $ | - |
(Dollars in thousands) | ||||||||||||||||
Nine Months Ended September 30, 2017 | ||||||||||||||||
Number of Contracts | Pre- Modification Outstanding Recorded Investment | Post- Modification Outstanding Recorded Investment | Related Allowance | |||||||||||||
Originated Loans | ||||||||||||||||
Real Estate | ||||||||||||||||
Residential | 1 | $ | 61 | $ | 61 | $ | - | |||||||||
Total | 1 | $ | 61 | $ | 61 | $ | - |
(Dollars in thousands) | ||||||||||||||||
Nine Months Ended September 30, 2016 | ||||||||||||||||
Number of Contracts | Pre- Modification Outstanding Recorded Investment | Post- Modification Outstanding Recorded Investment | Related Allowance | |||||||||||||
Originated Loans | ||||||||||||||||
Real Estate | ||||||||||||||||
Other | 1 | $ | 7 | $ | 7 | $ | - | |||||||||
Total | 1 | $ | 7 | $ | 7 | $ | - | |||||||||
Loans Acquired at Fair Value | ||||||||||||||||
Real Estate | ||||||||||||||||
Residential | 1 | $ | 37 | $ | 45 | $ | - | |||||||||
Commercial | 1 | 539 | 539 | - | ||||||||||||
Total | 2 | $ | 576 | $ | 584 | $ | - |
The following table presents a summary of the loans considered to be impaired as of the dates indicated.
(Dollars in thousands) | |||||||||||||||||||||||||||||||||||||
September 30, 2017 | March 31, 2022 | ||||||||||||||||||||||||||||||||||||
Recorded Investment | Related Allowance | Unpaid Principal Balance | Average Recorded Investment | Interest Income Recognized | Recorded Investment | Related Allowance | Unpaid Principal Balance | Average Recorded Investment | Interest Income Recognized | ||||||||||||||||||||||||||||
(Dollars in thousands) | (Dollars in thousands) | ||||||||||||||||||||||||||||||||||||
With No Related Allowance Recorded: | With No Related Allowance Recorded: | ||||||||||||||||||||||||||||||||||||
Originated Loans | |||||||||||||||||||||||||||||||||||||
Real Estate: | Real Estate: | ||||||||||||||||||||||||||||||||||||
Residential | $ | 124 | $ | - | $ | 126 | $ | 133 | $ | 3 | Residential | $ | 1,118 | $ | 1,123 | $ | 1,124 | $ | 11 | ||||||||||||||||||
Commercial | 1,886 | - | 1,886 | 1,972 | 67 | Commercial | 9,525 | 9,609 | 9,626 | 73 | |||||||||||||||||||||||||||
Construction | 609 | - | 609 | 640 | 20 | Construction | 540 | 540 | 540 | 4 | |||||||||||||||||||||||||||
Commercial and Industrial | 751 | - | 751 | 747 | 28 | Commercial and Industrial | 1,900 | 2,227 | 1,942 | 5 | |||||||||||||||||||||||||||
Other | 2 | - | 2 | 3 | - | ||||||||||||||||||||||||||||||||
Total With No Related Allowance Recorded | $ | 3,372 | $ | - | $ | 3,374 | $ | 3,495 | $ | 118 | Total With No Related Allowance Recorded | $ | 13,083 | $ | — | $ | 13,499 | $ | 13,232 | $ | 93 | ||||||||||||||||
Loans Acquired at Fair Value | |||||||||||||||||||||||||||||||||||||
Real Estate: | |||||||||||||||||||||||||||||||||||||
Residential | $ | 1,268 | $ | - | $ | 1,268 | $ | 1,284 | $ | 49 | |||||||||||||||||||||||||||
Commercial | 944 | - | 944 | 975 | 38 | ||||||||||||||||||||||||||||||||
Commercial and Industrial | 263 | - | 263 | 351 | 11 | ||||||||||||||||||||||||||||||||
Total With No Related Allowance Recorded | $ | 2,475 | $ | - | $ | 2,475 | $ | 2,610 | $ | 98 | |||||||||||||||||||||||||||
Total Loans | |||||||||||||||||||||||||||||||||||||
With A Related Allowance Recorded: | With A Related Allowance Recorded: | ||||||||||||||||||||||||||||||||||||
Real Estate: | Real Estate: | ||||||||||||||||||||||||||||||||||||
Residential | $ | 1,392 | $ | - | $ | 1,394 | $ | 1,417 | $ | 52 | Residential | $ | — | $ | — | $ | — | $ | — | $ | — | ||||||||||||||||
Commercial | 2,830 | - | 2,830 | 2,947 | 105 | Commercial | — | — | — | — | — | ||||||||||||||||||||||||||
Construction | 609 | - | 609 | 640 | 20 | Construction | 1,992 | 84 | 1,992 | 2,001 | 22 | ||||||||||||||||||||||||||
Commercial and Industrial | 1,014 | - | 1,014 | 1,098 | 39 | Commercial and Industrial | 96 | 96 | 96 | 146 | 2 | ||||||||||||||||||||||||||
Other | 2 | - | 2 | 3 | - | ||||||||||||||||||||||||||||||||
Total With No Related Allowance Recorded | $ | 5,847 | $ | - | $ | 5,849 | $ | 6,105 | $ | 216 | |||||||||||||||||||||||||||
With A Related Allowance Recorded: | |||||||||||||||||||||||||||||||||||||
Originated Loans | |||||||||||||||||||||||||||||||||||||
Real Estate: | |||||||||||||||||||||||||||||||||||||
Commercial | $ | 1,495 | $ | 392 | $ | 1,495 | $ | 1,516 | $ | 49 | |||||||||||||||||||||||||||
Commercial and Industrial | 1,730 | 636 | 1,804 | 2,025 | 75 | ||||||||||||||||||||||||||||||||
Total With A Related Allowance Recorded | $ | 3,225 | $ | 1,028 | $ | 3,299 | $ | 3,541 | $ | 124 | Total With A Related Allowance Recorded | $ | 2,088 | $ | 180 | $ | 2,088 | $ | 2,147 | $ | 24 | ||||||||||||||||
Loans Acquired at Fair Value | |||||||||||||||||||||||||||||||||||||
Total Impaired Loans: | Total Impaired Loans: | ||||||||||||||||||||||||||||||||||||
Real Estate: | Real Estate: | ||||||||||||||||||||||||||||||||||||
Residential | Residential | $ | 1,118 | $ | — | $ | 1,123 | $ | 1,124 | $ | 11 | ||||||||||||||||||||||||||
Commercial | Commercial | 9,525 | — | 9,609 | 9,626 | 73 | |||||||||||||||||||||||||||||||
Construction | Construction | 2,532 | 84 | 2,532 | 2,541 | 26 | |||||||||||||||||||||||||||||||
Commercial and Industrial | $ | 84 | $ | 10 | $ | 84 | $ | 103 | $ | 4 | Commercial and Industrial | 1,996 | 96 | 2,323 | 2,088 | 7 | |||||||||||||||||||||
Total With A Related Allowance Recorded | $ | 84 | $ | 10 | $ | 84 | $ | 103 | $ | 4 | |||||||||||||||||||||||||||
Total Loans | |||||||||||||||||||||||||||||||||||||
Real Estate: | |||||||||||||||||||||||||||||||||||||
Commercial | $ | 1,495 | $ | 392 | $ | 1,495 | $ | 1,516 | $ | 49 | |||||||||||||||||||||||||||
Commercial and Industrial | 1,814 | 646 | 1,888 | 2,128 | 79 | ||||||||||||||||||||||||||||||||
Total With A Related Allowance Recorded | $ | 3,309 | $ | 1,038 | $ | 3,383 | $ | 3,644 | $ | 128 | |||||||||||||||||||||||||||
Total Impaired Loans | Total Impaired Loans | $ | 15,171 | $ | 180 | $ | 15,587 | $ | 15,379 | $ | 117 |
September 30, 2017 (cont.) | ||||||||||||||||||||
Recorded Investment | Related Allowance | Unpaid Principal Balance | Average Recorded Investment | Interest Income Recognized | ||||||||||||||||
Total Impaired Loans: | ||||||||||||||||||||
Originated Loans | ||||||||||||||||||||
Real Estate: | ||||||||||||||||||||
Residential | $ | 124 | $ | - | $ | 126 | $ | 133 | $ | 3 | ||||||||||
Commercial | 3,381 | 392 | 3,381 | 3,488 | 116 | |||||||||||||||
Construction | 609 | - | 609 | 640 | 20 | |||||||||||||||
Commercial and Industrial | 2,481 | 636 | 2,555 | 2,772 | 103 | |||||||||||||||
Other | 2 | - | 2 | 3 | - | |||||||||||||||
Total Impaired Loans | $ | 6,597 | $ | 1,028 | $ | 6,673 | $ | 7,036 | $ | 242 | ||||||||||
Loans Acquired at Fair Value | ||||||||||||||||||||
Real Estate: | ||||||||||||||||||||
Residential | $ | 1,268 | $ | - | $ | 1,268 | $ | 1,284 | $ | 49 | ||||||||||
Commercial | 944 | - | 944 | 975 | 38 | |||||||||||||||
Commercial and Industrial | 347 | 10 | 347 | 454 | 15 | |||||||||||||||
Total Impaired Loans | $ | 2,559 | $ | 10 | $ | 2,559 | $ | 2,713 | $ | 102 | ||||||||||
Total Loans | ||||||||||||||||||||
Real Estate: | ||||||||||||||||||||
Residential | $ | 1,392 | $ | - | $ | 1,394 | $ | 1,417 | $ | 52 | ||||||||||
Commercial | 4,325 | 392 | 4,325 | 4,463 | 154 | |||||||||||||||
Construction | 609 | - | 609 | 640 | 20 | |||||||||||||||
Commercial and Industrial | 2,828 | 646 | 2,902 | 3,226 | 118 | |||||||||||||||
Other | 2 | - | 2 | 3 | - | |||||||||||||||
Total Impaired Loans | $ | 9,156 | $ | 1,038 | $ | 9,232 | $ | 9,749 | $ | 344 |
December 31, 2016 | ||||||||||||||||||||
Recorded Investment | Related Allowance | Unpaid Principal Balance | Average Recorded Investment | Interest Income Recognized | ||||||||||||||||
With No Related Allowance Recorded: | ||||||||||||||||||||
Originated Loans | ||||||||||||||||||||
Real Estate: | ||||||||||||||||||||
Commercial | $ | 2,112 | $ | - | $ | 2,112 | $ | 2,228 | $ | 100 | ||||||||||
Construction | 702 | - | 702 | 843 | 28 | |||||||||||||||
Commercial and Industrial | 825 | - | 825 | 891 | 45 | |||||||||||||||
Other | 4 | - | 4 | 6 | 1 | |||||||||||||||
Total With No Related Allowance Recorded | $ | 3,643 | $ | - | $ | 3,643 | $ | 3,968 | $ | 174 | ||||||||||
Loans Acquired at Fair Value | ||||||||||||||||||||
Real Estate: | ||||||||||||||||||||
Residential | $ | 1,300 | $ | - | $ | 1,300 | $ | 1,320 | $ | 68 | ||||||||||
Commercial | 660 | - | 660 | 763 | 47 | |||||||||||||||
Commercial and Industrial | 441 | - | 441 | 543 | 21 | |||||||||||||||
Total With No Related Allowance Recorded | $ | 2,401 | $ | - | $ | 2,401 | $ | 2,626 | $ | 136 | ||||||||||
Total Loans | ||||||||||||||||||||
Real Estate: | ||||||||||||||||||||
Residential | $ | 1,300 | $ | - | $ | 1,300 | $ | 1,320 | $ | 68 | ||||||||||
Commercial | 2,772 | - | 2,772 | 2,991 | 147 | |||||||||||||||
Construction | 702 | - | 702 | 843 | 28 | |||||||||||||||
Commercial and Industrial | 1,266 | - | 1,266 | 1,434 | 66 | |||||||||||||||
Other | 4 | - | 4 | 6 | 1 | |||||||||||||||
Total With No Related Allowance Recorded | $ | 6,044 | $ | - | $ | 6,044 | $ | 6,594 | $ | 310 | ||||||||||
With A Related Allowance Recorded: | ||||||||||||||||||||
Originated Loans | ||||||||||||||||||||
Real Estate: | ||||||||||||||||||||
Commercial | $ | 1,249 | $ | 360 | $ | 1,249 | $ | 1,277 | $ | 66 | ||||||||||
Commercial and Industrial | 1,940 | 655 | 1,946 | 1,951 | 27 | |||||||||||||||
Total With A Related Allowance Recorded | $ | 3,189 | $ | 1,015 | $ | 3,195 | $ | 3,228 | $ | 93 | ||||||||||
Loans Acquired at Fair Value | ||||||||||||||||||||
Real Estate: | ||||||||||||||||||||
Commercial | $ | 347 | $ | 114 | $ | 437 | $ | 367 | $ | - | ||||||||||
Commercial and Industrial | 121 | 31 | 121 | 141 | 6 | |||||||||||||||
Total With A Related Allowance Recorded | $ | 468 | $ | 145 | $ | 558 | $ | 508 | $ | 6 | ||||||||||
Total Loans | ||||||||||||||||||||
Real Estate: | ||||||||||||||||||||
Commercial | $ | 1,596 | $ | 474 | $ | 1,686 | $ | 1,644 | $ | 66 | ||||||||||
Commercial and Industrial | 2,061 | 686 | 2,067 | 2,092 | 33 | |||||||||||||||
Total With A Related Allowance Recorded | $ | 3,657 | $ | 1,160 | $ | 3,753 | $ | 3,736 | $ | 99 |
December 31, 2021 | |||||||||||||||||
Recorded Investment | Related Allowance | Unpaid Principal Balance | Average Recorded Investment | Interest Income Recognized | |||||||||||||
(Dollars in thousands) | |||||||||||||||||
With No Related Allowance Recorded: | |||||||||||||||||
Real Estate: | |||||||||||||||||
Residential | $ | 1,133 | $ | 1,137 | $ | 1,158 | $ | 46 | |||||||||
Commercial | 9,733 | 9,787 | 27,207 | 927 | |||||||||||||
Construction | 540 | 540 | 887 | 34 | |||||||||||||
Commercial and Industrial | 1,979 | 2,286 | 3,230 | 49 | |||||||||||||
Total With No Related Allowance Recorded | $ | 13,385 | $ | — | $ | 13,750 | $ | 32,482 | $ | 1,056 | |||||||
With A Related Allowance Recorded: | |||||||||||||||||
Real Estate: | |||||||||||||||||
Residential | $ | — | $ | — | $ | — | $ | — | $ | — | |||||||
Commercial | 266 | 195 | 266 | 421 | 19 | ||||||||||||
Construction | 2,013 | 104 | 2,013 | 169 | 7 | ||||||||||||
Commercial and Industrial | — | — | — | 1,316 | 29 | ||||||||||||
Total With A Related Allowance Recorded | $ | 2,279 | $ | 299 | $ | 2,279 | $ | 1,906 | $ | 55 | |||||||
Total Impaired Loans | |||||||||||||||||
Real Estate: | |||||||||||||||||
Residential | $ | 1,133 | $ | — | $ | 1,137 | $ | 1,158 | $ | 46 | |||||||
Commercial | 9,999 | 195 | 10,053 | 27,628 | 946 | ||||||||||||
Construction | 2,553 | 104 | 2,553 | 1,056 | 41 | ||||||||||||
Commercial and Industrial | 1,979 | — | 2,286 | 4,546 | 78 | ||||||||||||
Total Impaired Loans | $ | 15,664 | $ | 299 | $ | 16,029 | $ | 34,388 | $ | 1,111 |
December 31, 2016 (cont.) | ||||||||||||||||||||
Recorded Investment | Related Allowance | Unpaid Principal Balance | Average Recorded Investment | Interest Income Recognized | ||||||||||||||||
Total Impaired Loans | ||||||||||||||||||||
Originated Loans | ||||||||||||||||||||
Real Estate: | ||||||||||||||||||||
Commercial | $ | 3,361 | $ | 360 | $ | 3,361 | $ | 3,505 | $ | 166 | ||||||||||
Construction | 702 | - | 702 | 843 | 28 | |||||||||||||||
Commercial and Industrial | 2,765 | 655 | 2,771 | 2,842 | 72 | |||||||||||||||
Other | 4 | - | 4 | 6 | 1 | |||||||||||||||
Total Impaired Loans | $ | 6,832 | $ | 1,015 | $ | 6,838 | $ | 7,196 | $ | 267 | ||||||||||
Loans Acquired at Fair Value | ||||||||||||||||||||
Real Estate: | ||||||||||||||||||||
Residential | $ | 1,300 | $ | - | $ | 1,300 | $ | 1,320 | $ | 68 | ||||||||||
Commercial | 1,007 | 114 | 1,097 | 1,130 | 47 | |||||||||||||||
Commercial and Industrial | 562 | 31 | 562 | 684 | 27 | |||||||||||||||
Total Impaired Loans | $ | 2,869 | $ | 145 | $ | 2,959 | $ | 3,134 | $ | 142 | ||||||||||
Total Loans | ||||||||||||||||||||
Real Estate: | ||||||||||||||||||||
Residential | $ | 1,300 | $ | - | $ | 1,300 | $ | 1,320 | $ | 68 | ||||||||||
Commercial | 4,368 | 474 | 4,458 | 4,635 | 213 | |||||||||||||||
Construction | 702 | - | 702 | 843 | 28 | |||||||||||||||
Commercial and Industrial | 3,327 | 686 | 3,333 | 3,526 | 99 | |||||||||||||||
Other | 4 | - | 4 | 6 | 1 | |||||||||||||||
Total Impaired Loans | $ | 9,701 | $ | 1,160 | $ | 9,797 | $ | 10,330 | $ | 409 |
(Dollars in thousands) | ||||||||||||||||||||||||||||||||
September 30, 2017 | ||||||||||||||||||||||||||||||||
Real Estate Residential | Real Estate Commercial | Real Estate Construction | Commercial and Industrial | Consumer | Other | Unallocated | Total | |||||||||||||||||||||||||
Originated Loans | ||||||||||||||||||||||||||||||||
June 30, 2017 | $ | 940 | $ | 2,017 | $ | 142 | $ | 1,760 | $ | 2,223 | $ | - | $ | 385 | $ | 7,467 | ||||||||||||||||
Charge-offs | (22 | ) | - | - | - | (217 | ) | - | - | (239 | ) | |||||||||||||||||||||
Recoveries | 6 | - | - | 1 | 38 | - | - | 45 | ||||||||||||||||||||||||
Provision | (47 | ) | 64 | 85 | (155 | ) | 317 | - | 36 | 300 | ||||||||||||||||||||||
September 30, 2017 | $ | 877 | $ | 2,081 | $ | 227 | $ | 1,606 | $ | 2,361 | $ | - | $ | 421 | $ | 7,573 | ||||||||||||||||
Loans Acquired at Fair Value | ||||||||||||||||||||||||||||||||
June 30, 2017 | $ | - | $ | 613 | $ | - | $ | 109 | $ | - | $ | - | $ | (106 | ) | $ | 616 | |||||||||||||||
Charge-offs | (45 | ) | - | - | - | - | - | - | (45 | ) | ||||||||||||||||||||||
Recoveries | 11 | 1 | - | - | - | - | - | 12 | ||||||||||||||||||||||||
Provision | 34 | (5 | ) | - | (7 | ) | - | - | (22 | ) | - | |||||||||||||||||||||
September 30, 2017 | $ | - | $ | 609 | $ | - | $ | 102 | $ | - | $ | - | $ | (128 | ) | $ | 583 | |||||||||||||||
Total Allowance for Loan Losses | ||||||||||||||||||||||||||||||||
June 30, 2017 | $ | 940 | $ | 2,630 | $ | 142 | $ | 1,869 | $ | 2,223 | $ | - | $ | 279 | $ | 8,083 | ||||||||||||||||
Charge-offs | (67 | ) | - | - | - | (217 | ) | - | - | (284 | ) | |||||||||||||||||||||
Recoveries | 17 | 1 | - | 1 | 38 | - | - | 57 | ||||||||||||||||||||||||
Provision | (13 | ) | 59 | 85 | (162 | ) | 317 | - | 14 | 300 | ||||||||||||||||||||||
September 30, 2017 | $ | 877 | $ | 2,690 | $ | 227 | $ | 1,708 | $ | 2,361 | $ | - | $ | 293 | $ | 8,156 | ||||||||||||||||
Originated Loans | ||||||||||||||||||||||||||||||||
December 31, 2016 | $ | 1,106 | $ | 1,942 | $ | 65 | $ | 1,579 | $ | 2,463 | $ | - | $ | 128 | $ | 7,283 | ||||||||||||||||
Charge-offs | (22 | ) | - | - | - | (661 | ) | - | - | (683 | ) | |||||||||||||||||||||
Recoveries | 11 | - | - | 37 | 155 | - | - | 203 | ||||||||||||||||||||||||
Provision | (218 | ) | 139 | 162 | (10 | ) | 404 | - | 293 | 770 | ||||||||||||||||||||||
September 30, 2017 | $ | 877 | $ | 2,081 | $ | 227 | $ | 1,606 | $ | 2,361 | $ | - | $ | 421 | $ | 7,573 | ||||||||||||||||
Loans Acquired at Fair Value | ||||||||||||||||||||||||||||||||
December 31, 2016 | $ | - | $ | 365 | $ | - | $ | 120 | $ | - | $ | - | $ | 35 | $ | 520 | ||||||||||||||||
Charge-offs | (109 | ) | (132 | ) | - | - | - | - | - | (241 | ) | |||||||||||||||||||||
Recoveries | 49 | 2 | - | - | 3 | - | - | 54 | ||||||||||||||||||||||||
Provision | 60 | 374 | - | (18 | ) | (3 | ) | - | (163 | ) | 250 | |||||||||||||||||||||
September 30, 2017 | $ | - | $ | 609 | $ | - | $ | 102 | $ | - | $ | - | $ | (128 | ) | $ | 583 | |||||||||||||||
Total Allowance for Loan Losses | ||||||||||||||||||||||||||||||||
December 31, 2016 | $ | 1,106 | $ | 2,307 | $ | 65 | $ | 1,699 | $ | 2,463 | $ | - | $ | 163 | $ | 7,803 | ||||||||||||||||
Charge-offs | (131 | ) | (132 | ) | - | - | (661 | ) | - | - | (924 | ) | ||||||||||||||||||||
Recoveries | 60 | 2 | - | 37 | 158 | - | - | 257 | ||||||||||||||||||||||||
Provision | (158 | ) | 513 | 162 | (28 | ) | 401 | - | 130 | 1,020 | ||||||||||||||||||||||
September 30, 2017 | $ | 877 | $ | 2,690 | $ | 227 | $ | 1,708 | $ | 2,361 | $ | - | $ | 293 | $ | 8,156 |
Real Estate Residential | Real Estate Commercial | Real Estate Construction | Commercial and Industrial | Consumer | Other | Unallocated | Total | |||||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||||||||
December 31, 2021 | $ | 1,420 | $ | 5,960 | $ | 1,249 | $ | 1,151 | $ | 1,050 | $ | — | $ | 752 | $ | 11,582 | ||||||||||
Charge-offs | (17) | — | — | — | (20) | — | — | (37) | ||||||||||||||||||
Recoveries | 2 | — | — | 11 | 37 | — | — | 50 | ||||||||||||||||||
Provision (Recovery) | (20) | (5,449) | (448) | 3,406 | 921 | — | 1,590 | — | ||||||||||||||||||
March 31, 2022 | $ | 1,385 | $ | 511 | $ | 801 | $ | 4,568 | $ | 1,988 | $ | — | $ | 2,342 | $ | 11,595 |
September 30, 2017 | ||||||||||||||||||||||||||||||||
Real Estate Residential | Real Estate Commercial | Real Estate Construction | Commercial and Industrial | Consumer | Other | Unallocated | Total | |||||||||||||||||||||||||
Originated Loans | ||||||||||||||||||||||||||||||||
Individually Evaluated for Impairment | $ | - | $ | 392 | $ | - | $ | 636 | $ | - | $ | - | $ | - | $ | 1,028 | ||||||||||||||||
Collectively Evaluated for Potential Impairment | $ | 877 | $ | 1,689 | $ | 227 | $ | 970 | $ | 2,361 | $ | - | $ | 421 | $ | 6,545 | ||||||||||||||||
Loans Acquired at Fair Value | ||||||||||||||||||||||||||||||||
Individually Evaluated for Impairment | $ | - | $ | - | $ | - | $ | 10 | $ | - | $ | - | $ | - | $ | 10 | ||||||||||||||||
Collectively Evaluated for Potential Impairment | $ | - | $ | 609 | $ | - | $ | 92 | $ | - | $ | - | $ | (128 | ) | $ | 573 | |||||||||||||||
Total Allowance for Loan Losses | ||||||||||||||||||||||||||||||||
Individually Evaluated for Impairment | $ | - | $ | 392 | $ | - | $ | 646 | $ | - | $ | - | $ | - | $ | 1,038 | ||||||||||||||||
Collectively Evaluated for Potential Impairment | $ | 877 | $ | 2,298 | $ | 227 | $ | 1,062 | $ | 2,361 | $ | - | $ | 293 | $ | 7,118 |
September 30, 2016 | ||||||||||||||||||||||||||||||||
Real Estate Residential | Real Estate Commercial | Real Estate Construction | Commercial and Industrial | Consumer | Other | Unallocated | Total | |||||||||||||||||||||||||
Originated Loans | ||||||||||||||||||||||||||||||||
June 30, 2016 | $ | 1,110 | $ | 1,956 | $ | 82 | $ | 1,468 | $ | 2,143 | $ | 1 | $ | 295 | $ | 7,055 | ||||||||||||||||
Charge-offs | (4 | ) | (11 | ) | - | - | (166 | ) | (17 | ) | - | (198 | ) | |||||||||||||||||||
Recoveries | 4 | - | - | - | 21 | 5 | - | 30 | ||||||||||||||||||||||||
Provision | (38 | ) | 77 | (20 | ) | 50 | 360 | 12 | - | 441 | ||||||||||||||||||||||
September 30, 2016 | $ | 1,072 | $ | 2,022 | $ | 62 | $ | 1,518 | $ | 2,358 | $ | 1 | $ | 295 | $ | 7,328 | ||||||||||||||||
Loans Acquired at Fair Value | ||||||||||||||||||||||||||||||||
June 30, 2016 | $ | - | $ | 11 | $ | - | $ | 115 | $ | - | $ | - | $ | 10 | $ | 136 | ||||||||||||||||
Charge-offs | (8 | ) | - | - | - | - | (2 | ) | - | (10 | ) | |||||||||||||||||||||
Recoveries | 2 | - | - | - | 1 | - | - | 3 | ||||||||||||||||||||||||
Provision | 6 | (11 | ) | - | 20 | (1 | ) | 2 | (7 | ) | 9 | |||||||||||||||||||||
September 30, 2016 | $ | - | $ | - | $ | - | $ | 135 | $ | - | $ | - | $ | 3 | $ | 138 | ||||||||||||||||
Total Allowance for Loan Losses | ||||||||||||||||||||||||||||||||
June 30, 2016 | $ | 1,110 | $ | 1,967 | $ | 82 | $ | 1,583 | $ | 2,143 | $ | 1 | $ | 305 | $ | 7,191 | ||||||||||||||||
Charge-offs | (12 | ) | (11 | ) | - | - | (166 | ) | (19 | ) | - | (208 | ) | |||||||||||||||||||
Recoveries | 6 | - | - | - | 22 | 5 | - | 33 | ||||||||||||||||||||||||
Provision | (32 | ) | 66 | (20 | ) | 70 | 359 | 14 | (7 | ) | 450 | |||||||||||||||||||||
September 30, 2016 | $ | 1,072 | $ | 2,022 | $ | 62 | $ | 1,653 | $ | 2,358 | $ | 1 | $ | 298 | $ | 7,466 | ||||||||||||||||
Originated Loans | ||||||||||||||||||||||||||||||||
December 31, 2015 | $ | 1,623 | $ | 2,045 | $ | 137 | $ | 784 | $ | 1,887 | $ | - | $ | 14 | $ | 6,490 | ||||||||||||||||
Charge-offs | (24 | ) | (11 | ) | - | - | (476 | ) | (43 | ) | - | (554 | ) | |||||||||||||||||||
Recoveries | 8 | - | - | - | 102 | 16 | - | 126 | ||||||||||||||||||||||||
Provision | (535 | ) | (12 | ) | (75 | ) | 734 | 845 | 28 | 281 | 1,266 | |||||||||||||||||||||
September 30, 2016 | $ | 1,072 | $ | 2,022 | $ | 62 | $ | 1,518 | $ | 2,358 | $ | 1 | $ | 295 | $ | 7,328 | ||||||||||||||||
Loans Acquired at Fair Value | ||||||||||||||||||||||||||||||||
December 31, 2015 | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | ||||||||||||||||
Charge-offs | (24 | ) | (180 | ) | - | - | (7 | ) | - | - | (211 | ) | ||||||||||||||||||||
Recoveries | 7 | 2 | - | - | 6 | - | - | 15 | ||||||||||||||||||||||||
Provision | 17 | 178 | - | 135 | 1 | - | 3 | 334 | ||||||||||||||||||||||||
September 30, 2016 | $ | - | $ | - | $ | - | $ | 135 | $ | - | $ | - | $ | 3 | $ | 138 | ||||||||||||||||
Total Allowance for Loan Losses | ||||||||||||||||||||||||||||||||
December 31, 2015 | $ | 1,623 | $ | 2,045 | $ | 137 | $ | 784 | $ | 1,887 | $ | - | $ | 14 | $ | 6,490 | ||||||||||||||||
Charge-offs | (48 | ) | (191 | ) | - | - | (483 | ) | (43 | ) | - | (765 | ) | |||||||||||||||||||
Recoveries | 15 | 2 | - | - | 108 | 16 | - | 141 | ||||||||||||||||||||||||
Provision | (518 | ) | 166 | (75 | ) | 869 | 846 | 28 | 284 | 1,600 | ||||||||||||||||||||||
September 30, 2016 | $ | 1,072 | $ | 2,022 | $ | 62 | $ | 1,653 | $ | 2,358 | $ | 1 | $ | 298 | $ | 7,466 |
September 30, 2016 | ||||||||||||||||||||||||||||||||
Real Estate Residential | Real Estate Commercial | Real Estate Construction | Commercial and Industrial | Consumer | Other | Unallocated | Total | |||||||||||||||||||||||||
Originated Loans | ||||||||||||||||||||||||||||||||
Individually Evaluated for Impairment | $ | - | $ | 385 | $ | - | $ | 701 | $ | - | $ | - | $ | - | $ | 1,086 | ||||||||||||||||
Collectively Evaluated for Potential Impairment | $ | 1,072 | $ | 1,637 | $ | 62 | $ | 817 | $ | 2,358 | $ | 1 | $ | 295 | $ | 6,242 | ||||||||||||||||
Loans Acquired at Fair Value | ||||||||||||||||||||||||||||||||
Individually Evaluated for Impairment | $ | - | $ | 122 | $ | - | $ | 39 | $ | - | $ | - | $ | - | $ | 161 | ||||||||||||||||
Collectively Evaluated for Potential Impairment | $ | - | $ | (122 | ) | $ | - | $ | 96 | $ | - | $ | - | $ | 3 | $ | (23 | ) | ||||||||||||||
Total Allowance for Loan Losses | ||||||||||||||||||||||||||||||||
Individually Evaluated for Impairment | $ | - | $ | 507 | $ | - | $ | 740 | $ | - | $ | - | $ | - | $ | 1,247 | ||||||||||||||||
Collectively Evaluated for Potential Impairment | $ | 1,072 | $ | 1,515 | $ | 62 | $ | 913 | $ | 2,358 | $ | 1 | $ | 298 | $ | 6,219 |
March 31, 2022 | ||||||||||||||||||||||||||
Real Estate Residential | Real Estate Commercial | Real Estate Construction | Commercial and Industrial | Consumer | Other | Unallocated | Total | |||||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||||||||
Individually Evaluated for Impairment | $ | — | $ | — | $ | 84 | $ | 96 | $ | — | $ | — | $ | — | $ | 180 | ||||||||||
Collectively Evaluated for Potential Impairment | $ | 1,385 | $ | 511 | $ | 717 | $ | 4,472 | $ | 1,988 | $ | — | $ | 2,342 | $ | 11,415 |
December 31, 2016 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Real Estate Residential | Real Estate Commercial | Real Estate Construction | Commercial and Industrial | Consumer | Other | Unallocated | Total | December 31, 2021 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Originated Loans | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Real Estate Residential | Real Estate Commercial | Real Estate Construction | Commercial and Industrial | Consumer | Other | Unallocated | Total | |||||||||||||||||||||||||||||||||||||||||||||||||||
(Dollars in thousands) | (Dollars in thousands) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Individually Evaluated for Impairment | $ | - | $ | 360 | $ | - | $ | 655 | $ | - | $ | - | $ | - | $ | 1,015 | Individually Evaluated for Impairment | $ | — | $ | 195 | $ | 104 | $ | — | $ | — | $ | — | $ | — | $ | 299 | |||||||||||||||||||||||||
Collectively Evaluated for Potential Impairment | $ | 1,106 | $ | 1,582 | $ | 65 | $ | 924 | $ | 2,463 | $ | - | $ | 128 | $ | 6,268 | Collectively Evaluated for Potential Impairment | $ | 1,420 | $ | 5,765 | $ | 1,145 | $ | 1,151 | $ | 1,050 | $ | — | $ | 752 | $ | 11,283 | |||||||||||||||||||||||||
Loans Acquired at Fair Value | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Individually Evaluated for Impairment | $ | - | $ | 114 | $ | - | $ | 31 | $ | - | $ | - | $ | - | $ | 145 | ||||||||||||||||||||||||||||||||||||||||||
Collectively Evaluated for Potential Impairment | $ | - | $ | 251 | $ | - | $ | 89 | $ | - | $ | - | $ | 35 | $ | 375 | ||||||||||||||||||||||||||||||||||||||||||
Total Allowance for Loan Losses | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Individually Evaluated for Impairment | $ | - | $ | 474 | $ | - | $ | 686 | $ | - | $ | - | $ | - | $ | 1,160 | ||||||||||||||||||||||||||||||||||||||||||
Collectively Evaluated for Potential Impairment | $ | 1,106 | $ | 1,833 | $ | 65 | $ | 1,013 | $ | 2,463 | $ | - | $ | 163 | $ | 6,643 |
The following table presents changes in the accretable discount on the loans acquired at fair value for the dates indicated.
Accretable Discount | ||||
Balance at December 31, 2016 | $ | 1,640 | ||
Accretable Yield | (533 | ) | ||
Nonaccretable Discount | (113 | ) | ||
Balance at September 30, 2017 | $ | 994 |
Real Estate Residential | Real Estate Commercial | Real Estate Construction | Commercial and Industrial | Consumer | Other | Unallocated | Total | |||||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||||||||
December 31, 2020 | $ | 2,249 | $ | 6,010 | $ | 889 | $ | 1,423 | $ | 1,283 | $ | — | $ | 917 | $ | 12,771 | ||||||||||
Charge-offs | — | — | — | — | (95) | — | — | (95) | ||||||||||||||||||
Recoveries | 9 | — | — | 12 | 28 | — | — | 49 | ||||||||||||||||||
Provision (Recovery) | (283) | (93) | 50 | 108 | (113) | — | 331 | — | ||||||||||||||||||
March 31, 2021 | $ | 1,975 | $ | 5,917 | $ | 939 | $ | 1,543 | $ | 1,103 | $ | — | $ | 1,248 | $ | 12,725 |
March 31, 2021 | ||||||||||||||||||||||||||
Real Estate Residential | Real Estate Commercial | Real Estate Construction | Commercial and Industrial | Consumer | Other | Unallocated | Total | |||||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||||||||
Individually Evaluated for Impairment | $ | — | $ | 269 | $ | — | $ | 502 | $ | — | $ | — | $ | — | $ | 771 | ||||||||||
Collectively Evaluated for Potential Impairment | $ | 1,975 | $ | 5,648 | $ | 939 | $ | 1,041 | $ | 1,103 | $ | — | $ | 1,248 | $ | 11,954 |
(Dollars in thousands) | ||||||||||||||||||||||||||||
September 30, 2017 | ||||||||||||||||||||||||||||
Real Estate Residential | Real Estate Commercial | Real Estate Construction | Commercial and Industrial | Consumer | Other | Total | ||||||||||||||||||||||
Originated Loans | ||||||||||||||||||||||||||||
Individually Evaluated for Impairment | $ | 124 | $ | 3,381 | $ | 609 | $ | 2,481 | $ | - | $ | 2 | $ | 6,597 | ||||||||||||||
Collectively Evaluated for Potential Impairment | 193,090 | 147,061 | 28,356 | 74,736 | 113,822 | 3,442 | 560,507 | |||||||||||||||||||||
$ | 193,214 | $ | 150,442 | $ | 28,965 | $ | 77,217 | $ | 113,822 | $ | 3,444 | $ | 567,104 | |||||||||||||||
Loans Acquired at Fair Value | ||||||||||||||||||||||||||||
Individually Evaluated for Impairment | $ | 1,268 | $ | 944 | $ | - | $ | 347 | $ | - | $ | - | $ | 2,559 | ||||||||||||||
Collectively Evaluated for Potential Impairment | 73,949 | 51,882 | - | 8,185 | 195 | - | 134,211 | |||||||||||||||||||||
$ | 75,217 | $ | 52,826 | $ | - | $ | 8,532 | $ | 195 | $ | - | $ | 136,770 | |||||||||||||||
Total Loans | ||||||||||||||||||||||||||||
Individually Evaluated for Impairment | $ | 1,392 | $ | 4,325 | $ | 609 | $ | 2,828 | $ | - | $ | 2 | $ | 9,156 | ||||||||||||||
Collectively Evaluated for Potential Impairment | 267,039 | 198,943 | 28,356 | 82,921 | 114,017 | 3,442 | 694,718 | |||||||||||||||||||||
$ | 268,431 | $ | 203,268 | $ | 28,965 | $ | 85,749 | $ | 114,017 | $ | 3,444 | $ | 703,874 |
December 31, 2016 | ||||||||||||||||||||||||||||
Real Estate Residential | Real Estate Commercial | Real Estate Construction | Commercial and Industrial | Consumer | Other | Total | ||||||||||||||||||||||
Originated Loans | ||||||||||||||||||||||||||||
Individually Evaluated for Impairment | $ | - | $ | 3,361 | $ | 702 | $ | 2,765 | $ | - | $ | 4 | $ | 6,832 | ||||||||||||||
Collectively Evaluated for Potential Impairment | 186,077 | 136,533 | 9,944 | 68,326 | 114,007 | 3,633 | 518,520 | |||||||||||||||||||||
$ | 186,077 | $ | 139,894 | $ | 10,646 | $ | 71,091 | $ | 114,007 | $ | 3,637 | $ | 525,352 | |||||||||||||||
Loans Acquired at Fair Value | ||||||||||||||||||||||||||||
Individually Evaluated for Impairment | $ | 1,300 | $ | 1,007 | $ | - | $ | 562 | $ | - | $ | - | $ | 2,869 | ||||||||||||||
Collectively Evaluated for Potential Impairment | 84,211 | 60,109 | - | 9,159 | 197 | - | 153,676 | |||||||||||||||||||||
$ | 85,511 | $ | 61,116 | $ | - | $ | 9,721 | $ | 197 | $ | - | $ | 156,545 | |||||||||||||||
Total Loans | ||||||||||||||||||||||||||||
Individually Evaluated for Impairment | $ | 1,300 | $ | 4,368 | $ | 702 | $ | 3,327 | $ | - | $ | 4 | $ | 9,701 | ||||||||||||||
Collectively Evaluated for Potential Impairment | 270,288 | 196,642 | 9,944 | 77,485 | 114,204 | 3,633 | 672,196 | |||||||||||||||||||||
$ | 271,588 | $ | 201,010 | $ | 10,646 | $ | 80,812 | $ | 114,204 | $ | 3,637 | $ | 681,897 |
March 31, 2022 | |||||||||||||||||||||||
Real Estate Residential | Real Estate Commercial | Real Estate Construction | Commercial and Industrial | Consumer | Other | Total | |||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||
Individually Evaluated for Impairment | $ | 1,118 | $ | 9,525 | $ | 2,532 | $ | 1,996 | $ | — | $ | — | $ | 15,171 | |||||||||
Collectively Evaluated for Potential Impairment | 316,136 | 417,702 | 51,695 | 65,847 | 143,422 | 10,669 | 1,005,471 | ||||||||||||||||
Total Loans | $ | 317,254 | $ | 427,227 | $ | 54,227 | $ | 67,843 | $ | 143,422 | $ | 10,669 | $ | 1,020,642 |
Note 5. Deposits
December 31, 2021 Consumer Other Total (Dollars in thousands) Individually Evaluated for Impairment $ 1,133 $ 9,999 $ 2,553 $ 1,979 $ — $ — $ 15,664 Collectively Evaluated for Potential Impairment 319,665 382,125 82,475 87,031 122,152 11,684 1,005,132 Total Loans $ 320,798 $ 392,124 $ 85,028 $ 89,010 $ 122,152 $ 11,684 $ 1,020,796
Maturity Period: | September 30, 2017 | |||
One Year or Less | $ | 43,884 | ||
Over One Through Two Years | 66,257 | |||
Over Two Through Three Years | 20,973 | |||
Over Three Through Four Years | 12,111 | |||
Over Four Through Five Years | 9,112 | |||
Over Five Years | 8,129 | |||
Total | $ | 160,466 |
The balance in time deposits that meet or exceed the FDIC insurance limit of $250,000 totaled $47.9 million and $46.0 million as of September 30, 2017 and December 31, 2016, respectively.
Accretable Discount | |||||
(Dollars in Thousands) | |||||
December 31, 2021 | $ | 726 | |||
Accretable Yield | (56) | ||||
March 31, 2022 | $ | 670 |
(Dollars in thousands) | |||||||||||||||||||||||||||||||||
September 30, 2017 | December 31, 2016 | March 31, 2022 | December 31, 2021 | ||||||||||||||||||||||||||||||
Amount | Weighted Average Rate | Amount | Weighted Average Rate | Amount | Weighted Average Rate | Amount | Weighted Average Rate | ||||||||||||||||||||||||||
Short-term Borrowings | |||||||||||||||||||||||||||||||||
Federal Funds Purchased: | |||||||||||||||||||||||||||||||||
Average Balance Outstanding During the Period | $ | 11 | - | % | $ | 307 | 0.65 | % | |||||||||||||||||||||||||
Maximum Amount Outstanding at any Month End | 550 | 6,000 | |||||||||||||||||||||||||||||||
FHLB Borrowings: | |||||||||||||||||||||||||||||||||
Balance at Period End | - | - | - | - | |||||||||||||||||||||||||||||
Average Balance Outstanding During the Period | - | - | 596 | 0.67 | |||||||||||||||||||||||||||||
Maximum Amount Outstanding at any Month End | - | 6,160 | |||||||||||||||||||||||||||||||
(Dollars in thousands) | (Dollars in thousands) | ||||||||||||||||||||||||||||||||
Securities Sold Under Agreements to Repurchase: | Securities Sold Under Agreements to Repurchase: | ||||||||||||||||||||||||||||||||
Balance at Period End | 24,662 | 0.25 | 27,027 | 0.24 | Balance at Period End | $ | 39,219 | 0.17 | % | $ | 39,266 | 0.17 | % | ||||||||||||||||||||
Average Balance Outstanding During the Period | 26,302 | 0.30 | 26,311 | 0.26 | Average Balance Outstanding During the Period | 37,884 | 0.20 | 43,988 | 0.22 | ||||||||||||||||||||||||
Maximum Amount Outstanding at any Month End | 27,817 | 30,095 | Maximum Amount Outstanding at any Month End | 39,219 | 52,777 | ||||||||||||||||||||||||||||
Securities Collaterizing the Agreements at Period-End: | Securities Collaterizing the Agreements at Period-End: | ||||||||||||||||||||||||||||||||
Carrying Value | 35,128 | 33,785 | Carrying Value | 58,757 | 59,867 | ||||||||||||||||||||||||||||
Market Value | 34,510 | 32,931 | Market Value | 54,703 | 59,339 |
Note 7. Other Borrowed Funds
Other borrowed funds consist of fixed rate advances from6. Fair Value Disclosure
(Dollars in thousands) | ||||||||||||||||
September 30, 2017 | December 31, 2016 | |||||||||||||||
Amount | Weighted Average Rate | Amount | Weighted Average Rate | |||||||||||||
Due in One Year | $ | 3,500 | 1.35 | % | $ | - | - | % | ||||||||
Due After One Year to Two Years | 4,000 | 1.67 | 3,500 | 0.94 | ||||||||||||
Due After Two Years to Three Years | 6,000 | 1.88 | 4,500 | 1.41 | ||||||||||||
Due After Three Years to Four Years | 5,000 | 2.09 | 6,000 | 1.78 | ||||||||||||
Due After Four Years to Five Years | 3,000 | 2.23 | 6,000 | 1.97 | ||||||||||||
Due After Five Years | 3,000 | 2.41 | 8,000 | 2.27 | ||||||||||||
Total | $ | 24,500 | 1.92 | $ | 28,000 | 1.80 |
AsThe three levels of September 30, 2017,fair value hierarchy are as follows:
The Company maintains a Borrower-In-Custody of Collateral line of credit agreement withfair value hierarchy within which the Federal Reserve Bank (“FRB”) for $88.3 millionfair value measurement falls is determined based on the lowest level input that requires monthly certification of collateral, is subject to annual renewal, incurs no service charge and is secured by commercial and consumer indirect auto loans. The Company also maintains multiple line of credit arrangements with various unaffiliated banks totaling $40.0 million. As of September 30, 2017 and December 31, 2016, no draws had been taken on these facilities.
Note 8. Commitments and Contingent Liabilities
The Company is a party to financial instruments with off-balance-sheet risk in the normal course of business primarily to meet the financing needs of its customers. These financial instruments include commitments to extend credit and standby and performance letters of credit. Those instruments involve, to varying degrees, elements of credit and interest rate risk in excess of the amount recognized in the Statement of Financial Condition. The contract amounts of those instruments reflect the extent of involvement the Company has in particular classes of financial instruments.
The Company’s exposure to credit loss in the event of nonperformance by the other partysignificant to the financial instrument for commitments to extend credit and standby and performance letters of credit written is represented by the contractual amount of those instruments. The Company uses the same credit policies in making commitments and conditional obligations as it does for on-balance-sheet instruments.
Commitments and conditional obligations are evaluated the same as on-balance-sheet instruments but do not have a corresponding reserve recorded. The Company’s opinion on not implementing a corresponding reserve for off-balance-sheet instruments is supported by historical factors of no losses recorded due to these items. The Company is continually evaluating these items for credit quality and any future need for the corresponding reserve.
fair value measurement.
Fair Value Hierarchy | March 31 2022 | December 31 2021 | |||||||||
(Dollars in thousands) | |||||||||||
Securities: | |||||||||||
Available-for-Sale Debt Securities | |||||||||||
U.S. Government Agencies | Level 2 | $ | 49,211 | $ | 52,561 | ||||||
Obligations of States and Political Subdivisions | Level 2 | 18,393 | 18,955 | ||||||||
Mortgage-Backed Securities - Government-Sponsored Enterprises | Level 2 | 50,619 | 56,559 | ||||||||
Collateralized Mortgage Obligations - Government Sponsored Enterprises | Level 2 | 100,808 | 86,583 | ||||||||
Corporate Debt | Level 2 | 9,207 | 7,450 | ||||||||
Total Available-for-Sale Debt Securities | 228,238 | 222,108 | |||||||||
Equity Securities | |||||||||||
Mutual Funds | Level 1 | 944 | 990 | ||||||||
Other | Level 1 | 1,915 | 1,876 | ||||||||
Total Equity Securities | 2,859 | 2,866 | |||||||||
Total Securities | $ | 231,097 | $ | 224,974 |
Financial Asset | Fair Value Hierarchy | March 31, 2022 | Valuation Techniques | Significant Unobservable Inputs | Range | Weighted Average | ||||||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||||||||
Impaired Loans Individually Assessed | Level 3 | $ | 1,908 | Appraisal of Collateral (1) | Appraisal Adjustments (2) | 0 | % | to | 50 | % | 15.8% | |||||||||||||||
Mortgage Servicing Rights | Level 3 | 178 | Discounted Cash Flow | Discount Rate | 9 | % | to | 11 | % | 10.3% | ||||||||||||||||
Prepayment Speed | 9 | % | to | 16 | % | 10.8% | ||||||||||||||||||||
Financial Asset | Fair Value Hierarchy | December 31, 2021 | Valuation Techniques | Significant Unobservable Inputs | Range | Weighted Average | ||||||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||||||||
Impaired Loans Individually Assessed | Level 3 | $ | 1,980 | Appraisal of Collateral (1) | Appraisal Adjustments (2) | 0 | % | to | 50 | % | 15.8% | |||||||||||||||
Mortgage Servicing Rights | Level 3 | 141 | Discounted Cash Flow | Discount Rate | 9 | % | to | 11 | % | 10.2% | ||||||||||||||||
Prepayment Speed | 12 | % | to | 27 | % | 16.0% | ||||||||||||||||||||
OREO | Level 3 | 36 | Appraisal of Collateral (1) | Liquidation Expenses (2) | 10 | % | to | 30 | % | 26.6% |
(Dollars in thousands) | ||||||||
September 30, 2017 | December 31, 2016 | |||||||
Standby Letters of Credit | $ | 49,889 | $ | 36,657 | ||||
Performance Letters of Credit | 4,396 | 2,471 | ||||||
Construction Mortgages | 23,825 | 21,363 | ||||||
Personal Lines of Credit | 6,271 | 5,905 | ||||||
Overdraft Protection Lines | 6,183 | 5,680 | ||||||
Home Equity Lines of Credit | 15,799 | 14,722 | ||||||
Commercial Lines of Credit | 71,776 | 51,725 | ||||||
$ | 178,139 | $ | 138,523 |
March 31, 2022 | December 31, 2021 | |||||||||||||||||||
Fair Value Hierarchy | Carrying Value | Fair Value | Carrying Value | Fair Value | ||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||
Financial Assets: | ||||||||||||||||||||
Cash and Due From Banks: | ||||||||||||||||||||
Interest Bearing | Level 1 | $ | 55,233 | $ | 55,233 | $ | 63,968 | $ | 63,968 | |||||||||||
Non-Interest Bearing | Level 1 | 68,355 | 68,355 | 55,706 | 55,706 | |||||||||||||||
Securities | See Above | 231,097 | 231,097 | 224,974 | 224,974 | |||||||||||||||
Loans, Net | Level 3 | 1,009,047 | 1,014,050 | 1,009,214 | 1,039,980 | |||||||||||||||
Restricted Stock | Level 2 | 3,428 | 3,428 | 3,403 | 3,403 | |||||||||||||||
Mortgage Servicing Rights | Level 3 | 716 | 892 | 730 | 773 | |||||||||||||||
Accrued Interest Receivable | Level 2 | 3,256 | 3,256 | 3,350 | 3,350 | |||||||||||||||
Financial Liabilities: | ||||||||||||||||||||
Deposits | Level 2 | 1,250,313 | 1,249,804 | 1,226,613 | 1,227,653 | |||||||||||||||
Short-Term Borrowings | Level 2 | 39,219 | 39,219 | 39,266 | 39,266 | |||||||||||||||
Other Borrowed Funds | ||||||||||||||||||||
FHLB Borrowings | Level 2 | 3,000 | 3,000 | 3,000 | 3,000 | |||||||||||||||
Subordinated Debt | Level 2 | 14,607 | 14,749 | 14,601 | 15,000 | |||||||||||||||
Accrued Interest Payable | Level 2 | 546 | 546 | 486 | 486 |
Commitments to extend credit are agreements to lend to a customer as long as there is no violation of any condition established in the contract. Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. Because many of the commitments are expected to expire without being drawn upon, the total commitment amounts do not necessarily represent future cash requirements. The Company evaluates each customer’s creditworthiness on a case-by-case basis. The amount of collateral obtained, if deemed necessary by the Company upon extension of credit, is based on management’s credit evaluation of the counterparty. Collateral held varies, but may include accounts receivable, inventory, property, plant and equipment, and income-producing commercial properties.
Performance letters of credit represent conditional commitments issued by the Company to guarantee the performance of a customer to a third party. These instruments are issued primarily to support bid or performance-related contracts. The coverage period for these instruments is typically a one-year period with an annual renewal option subject to prior approval by management. Fees earned from the issuance of these letters are recognized upon expiration of the letter. For secured letters of credit, the collateral is typically Company deposit instruments or customer business assets.
FASB ASC 820 “Fair Value Measurement” defines fair value7. Commitments and provides the framework for measuring fair value and required disclosures about fair value measurements. Fair valueContingent Liabilities
The three levels of fair value hierarchy are as follows:
This hierarchy requires the use of observable market data when available. The level in the fair value hierarchy within which the fair value measurement falls is determined based on the lowest level input that is significant to the fair value measurement.
The following table presents the unused and available credit balances of financial assets measuredinstruments whose contracts represent credit risk at fair valuethe dates indicated.
March 31, 2022 | December 31, 2021 | |||||||
(Dollars in thousands) | ||||||||
Standby Letters of Credit | $ | 110 | $ | 110 | ||||
Performance Letters of Credit | 1,918 | 2,873 | ||||||
Construction Mortgages | 49,823 | 55,597 | ||||||
Personal Lines of Credit | 7,090 | 7,055 | ||||||
Overdraft Protection Lines | 5,596 | 5,709 | ||||||
Home Equity Lines of Credit | 22,171 | 21,187 | ||||||
Commercial Lines of Credit | 74,665 | 83,316 | ||||||
Total Commitments | $ | 161,373 | $ | 175,847 |
(Dollars in thousands) | ||||||||||||
Fair Value Hierarchy | September 30, 2017 | December 31, 2016 | ||||||||||
Available for Sales Securities: | ||||||||||||
U.S. Government Agencies | Level II | $ | 58,380 | $ | 66,156 | |||||||
Obligations of States and Political Subdivisions | Level II | 37,808 | 35,735 | |||||||||
Mortgage-Backed Securities - Government-Sponsored Enterprises | Level II | 17,859 | 2,619 | |||||||||
Equity Securities - Mutual Funds | Level I | 510 | 507 | |||||||||
Equity Securities - Other | Level I | 1,332 | 1,191 | |||||||||
Total Available for Sale Securities | $ | 115,889 | $ | 106,208 |
The following table presents the financial assets measured at fair value on a nonrecurring basisOther Liabilities on the Consolidated StatementStatements of Financial Condition asCondition.
Three Months Ended March 31, | ||||||||||||||
2022 | 2021 | |||||||||||||
(Dollars in thousands) | ||||||||||||||
Operating Lease Expense | $ | 82 | $ | 95 | ||||||||||
Short-Term Lease Expense | — | 8 | ||||||||||||
Variable Lease Expense | 7 | 8 | ||||||||||||
Total Lease Expense | $ | 89 | $ | 111 |
(Dollars in thousands) | ||||||||||||||||||||
Fair Value at | Significant | |||||||||||||||||||
Financial Asset | Fair Value Hierarchy | September 30, 2017 | December 31, 2016 | Valuation Techniques | Significant Unobservable Inputs | Unobservable Input Value | ||||||||||||||
Impaired Loans | Level III | $ | 2,271 | $ | 2,497 | Market Comparable Properties | Marketability Discount | 10% | to | 30% | (1) | |||||||||
OREO | Level III | 169 | - | Market Comparable Properties | Marketability Discount | 10% | to | 50% | (1) |
Impaired loans are evaluated when a loan is identified as impaired and valued at the lower of cost or fair value at that time. Fair value is measured based on the value of the collateral securing these loans and is classified as Level III in the fair value hierarchy. At September 30, 2017 and December 31, 2016, the fair value of impaired loans consists of the loan balances of $3.3 million and $3.7 million, respectively, less their specific valuation allowances of $1.0 million and $1.2 million, respectively.
Other real estate owned (OREO) properties are evaluated at the time of acquisition and recorded at fair value, less estimated selling costs. After acquisition, other real estate owned is recorded at the lower of cost or fair value, less estimated selling costs. The fair value of an other real estate owned property is determined from a qualified independent appraisal and is classified as Level III in the fair value hierarchy.
March 31, 2022 | December 31, 2021 | |||||||
(Dollars in thousands) | ||||||||
Operating Leases: | ||||||||
ROU Assets | $ | 1,776 | $ | 674 | ||||
Weighted Average Lease Term in Years | 9.02 | 7.33 | ||||||
Weighted Average Discount Rate | 2.47 | % | 2.51 | % |
March 31, 2022 | |||||
(Dollars in thousands) | |||||
Maturity Analysis: | |||||
Due in One Year | $ | 325 | |||
Due After One Year to Two Years | 268 | ||||
Due After Two Years to Three Years | 228 | ||||
Due After Three Years to Four Years | 201 | ||||
Due After Four to Five Years | 169 | ||||
Due After Five Years | 1,050 | ||||
Total | $ | 2,241 | |||
Less: Present Value Discount | 265 | ||||
Lease Liabilities | $ | 1,976 |
Financial instruments are defined as cash, evidence of an ownership in an entity, or a contract which creates an obligation or right to receive or deliver cash or another financial instrument from/to a second entity on potentially favorable or unfavorable terms.
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. If no readily available market exists, the fair value estimates for financial instruments should be based upon management’s judgment regarding current economic conditions, interest rate risk, expected cash flows, future estimated losses and other factors, as determined through various option pricing formulas or simulation modeling. As many of these assumptions result from judgments made by management based upon estimates which are inherently uncertain, the resulting estimated fair values may not be indicative of the amount realizable in the sale of a particular financial instrument. In addition, changes in the assumptions on which the estimated fair values are based may have significant impact on the resulting estimated fair values.
As certain assets such as deferred tax assets and premises and equipment are not considered financial instruments, the estimated fair value of financial instruments would not represent the full value of the Company.
The Company employs simulation modeling in determining the estimated fair value of financial instruments for which quoted market prices are not available, based upon the following assumptions:
Cash and Due From Banks, Restricted Stock, Bank-Owned Life Insurance, Accrued Interest Receivable, Short-Term Borrowings, and Accrued Interest Payable
The fair value is equal to the current carrying value.
Investment Securities
The fair value of investment securities is equal to the available quoted market price. If no quoted market price is available, fair value is estimated using the quoted market price for similar securities or matrix pricing, which is a mathematical technique, used widely in the industry to value debt securities without relying exclusively on quoted market prices for the specific securities, but rather by relying on the securities’ relationship to other benchmark quoted prices.
Loans Receivable
For variable-rate loans that reprice frequently and with no significant change in credit risk, fair values are based on carrying values. Fair values for certain mortgage loans and other consumer loans are based on quoted market prices of similar loans sold in conjunction with securitization transactions, adjusted for differences in loan characteristics. Fair values for other loans are estimated using discounted cash flow analyses, using market interest rates for comparable loans. Fair values for nonperforming loans are estimated using discounted cash flow analyses or underlying collateral values, where applicable.
Deposit Liabilities
The fair values disclosed for demand deposits, are, by definition, equal to the amount payable on demand at the reporting date. The carrying amounts of variable-rate, fixed-term money market accounts and certificates of deposit approximate their fair values at the reporting date. Fair values for fixed-rate certificates of deposit are estimated using a discounted cash flow calculation that applies market interest rates on comparable instruments to a schedule of aggregated expected monthly maturities on time deposits.
Borrowed Funds
Fair values of borrowed funds are estimated using discounted cash flow analyses based on current market rates for similar types of borrowing arrangements.
Commitments to Extend Credit
These financial instruments are generally not subject to sale and estimated fair values are not readily available. The carrying value, represented by the net deferred fee arising from the unrecognized commitment or letter of credit, and the fair value determined by discounting the remaining contractual fee over the term of the commitment using fees currently charged to enter into similar agreements with similar credit risk, are not considered material for disclosure. The contractual amounts of unfunded commitments and letters of credit are presented in Note 8.
The following table presents the estimated fair values of the Company’s financial instruments at the dates indicated.
(Dollars in thousands) | ||||||||||||||||||
September 30, 2017 | December 31, 2016 | |||||||||||||||||
Fair Value Hierarchy | Carrying Value | Fair Value | Carrying Value | Fair Value | ||||||||||||||
Financial Assets: | ||||||||||||||||||
Cash and Due From Banks: | ||||||||||||||||||
Interest Bearing | Level I | $ | 31,979 | $ | 31,979 | $ | 7,699 | $ | 7,699 | |||||||||
Non-Interest Bearing | Level I | 11,766 | 11,766 | 6,583 | 6,583 | |||||||||||||
Investment Securities: | ||||||||||||||||||
Available for Sale | See Above | 115,889 | 115,889 | 106,208 | 106,208 | |||||||||||||
Loans, Net | Level III | 695,718 | 706,433 | 674,094 | 684,777 | |||||||||||||
Restricted Stock | Level II | 3,712 | 3,712 | 3,665 | 3,665 | |||||||||||||
Bank-Owned Life Insurance | Level II | 19,035 | 19,035 | 18,687 | 18,687 | |||||||||||||
Accrued Interest Receivable | Level II | 2,572 | 2,572 | 2,441 | 2,441 | |||||||||||||
Financial Liabilities: | ||||||||||||||||||
Deposits | Level II | 762,374 | 738,836 | 698,218 | 697,806 | |||||||||||||
Short-term Borrowings | Level II | 24,662 | 24,662 | 27,027 | 27,027 | |||||||||||||
Other Borrowed Funds | Level II | 24,500 | 24,671 | 28,000 | 28,098 | |||||||||||||
Accrued Interest Payable | Level II | 413 | 413 | 334 | 334 |
In accordance with SEC Regulation S-X, other noninterest expense that exceeds 10% of total noninterest expense is required to be disclosed by detailed expenses.
Three Months Ended March 31, | ||||||||||||||
2022 | 2021 | |||||||||||||
(Dollars in thousands) | ||||||||||||||
Non-Employee Compensation | $ | 131 | $ | 148 | ||||||||||
Printing and Supplies | 80 | 99 | ||||||||||||
Postage | 103 | 63 | ||||||||||||
Telephone | 139 | 188 | ||||||||||||
Charitable Contributions | 42 | 15 | ||||||||||||
Dues and Subscriptions | 58 | 50 | ||||||||||||
Loan Expenses | 127 | 92 | ||||||||||||
Meals and Entertainment | 30 | 34 | ||||||||||||
Travel | 39 | 22 | ||||||||||||
Training | 18 | 17 | ||||||||||||
Bank Assessment | 47 | 44 | ||||||||||||
Insurance | 62 | 60 | ||||||||||||
Miscellaneous | 123 | 150 | ||||||||||||
Total Other Noninterest Expense | $ | 999 | $ | 982 |
Community Bank | Exchange Underwriters, Inc. | CB Financial Services, Inc. | Net Eliminations | Consolidated | |||||||||||||
(Dollars in thousands) | |||||||||||||||||
March 31, 2022 | |||||||||||||||||
Assets | $ | 1,439,251 | $ | 5,584 | $ | 136,994 | $ | (143,159) | $ | 1,438,670 | |||||||
Liabilities | 1,320,826 | 1,645 | 14,838 | (20,795) | 1,316,514 | ||||||||||||
Stockholders' Equity | 118,425 | 3,939 | 122,156 | (122,364) | 122,156 | ||||||||||||
December 31, 2021 | |||||||||||||||||
Assets | $ | 1,425,588 | $ | 5,110 | $ | 147,829 | $ | (153,048) | $ | 1,425,479 | |||||||
Liabilities | 1,299,325 | 1,731 | 14,705 | (23,406) | 1,292,355 | ||||||||||||
Stockholders' Equity | 126,263 | 3,379 | 133,124 | (129,642) | 133,124 | ||||||||||||
Three Months Ended March 31, 2022 | |||||||||||||||||
Interest and Dividend Income | $ | 10,596 | $ | 1 | $ | 1,279 | $ | (1,260) | $ | 10,616 | |||||||
Interest Expense | 567 | — | 156 | — | 723 | ||||||||||||
Net Interest and Dividend Income | 10,029 | 1 | 1,123 | (1,260) | 9,893 | ||||||||||||
Provision for Loan Losses | — | — | — | — | — | ||||||||||||
Net Interest and Dividend Income After Provision for Loan Losses | 10,029 | 1 | 1,123 | (1,260) | 9,893 | ||||||||||||
Noninterest Income | 777 | 1,797 | 39 | — | 2,613 | ||||||||||||
Noninterest Expense | 7,645 | 1,007 | 4 | — | 8,656 | ||||||||||||
Undistributed Net Income of Subsidiary | 561 | — | 1,852 | (2,413) | — | ||||||||||||
Income Before Income Tax Expense (Benefit) | 3,722 | 791 | 3,010 | (3,673) | 3,850 | ||||||||||||
Income Tax Expense (Benefit) | 610 | 230 | (37) | — | 803 | ||||||||||||
Net Income | $ | 3,112 | $ | 561 | $ | 3,047 | $ | (3,673) | $ | 3,047 | |||||||
Three Months Ended March 31, 2021 | |||||||||||||||||
Interest and Dividend Income | $ | 10,971 | $ | 1 | $ | 1,320 | $ | (1,304) | $ | 10,988 | |||||||
Interest Expense | 1,011 | — | — | — | 1,011 | ||||||||||||
Net Interest and Dividend Income | 9,960 | 1 | 1,320 | (1,304) | 9,977 | ||||||||||||
Provision for Loan Losses | — | — | — | — | — | ||||||||||||
Net Interest and Dividend Income After Provision for Loan Losses | 9,960 | 1 | 1,320 | (1,304) | 9,977 | ||||||||||||
Noninterest Income | 1,343 | 1,591 | 240 | — | 3,174 | ||||||||||||
Noninterest Expense | 8,390 | 1,001 | 4 | — | 9,395 | ||||||||||||
Undistributed Net Income of Subsidiary | 407 | — | 1,301 | (1,708) | — | ||||||||||||
Income Before Income Tax Expense | 3,320 | 591 | 2,857 | (3,012) | 3,756 | ||||||||||||
Income Tax Expense | 715 | 184 | 12 | — | 911 | ||||||||||||
Net Income | $ | 2,605 | $ | 407 | $ | 2,845 | $ | (3,012) | $ | 2,845 | |||||||
Number of Shares | Weighted Average Exercise Price | Weighted Average Remaining Contractual Life in Years | |||||||||
Outstanding Options at December 31, 2021 | 207,641 | $ | 24.01 | 4.8 | |||||||
Granted | 85,465 | 25.95 | |||||||||
Exercised | (7,500) | 22.25 | |||||||||
Forfeited | (68) | 30.75 | |||||||||
Outstanding Options at March 31, 2022 | 285,538 | $ | 24.64 | 6.1 | |||||||
Exercisable Options at March 31, 2022 | 179,515 | $ | 24.25 | 4.2 | |||||||
Number of Shares | Weighted Average Exercise Price | Weighted Average Remaining Service Period in Years | |||||||||
Nonvested Options March 31, 2022 | 106,023 | $ | 25.30 | 9.4 | |||||||
Summary of Significant Assumptions for Newly Issued Stock Options | |||||||||||
Expected Term in Years | 6.5 | ||||||||||
Expected Volatility | 28.7 | % | |||||||||
Expected Dividends | $ | 0.96 | |||||||||
Risk Free Rate of Return | 1.57 | % | |||||||||
Weighted Average Grant Date Fair Value (per share) | $ | 4.90 |
Number of Shares | Weighted Average Grant Date Fair Value Price | Weighted Average Remaining Service Period in Years | |||||||||
Nonvested Restricted Stock at December 31, 2021 | 56,140 | $ | 23.90 | 5.3 | |||||||
Granted | 20,765 | 26.25 | |||||||||
Vested | — | — | |||||||||
Forfeited | (200) | 20.38 | |||||||||
Nonvested Restricted Stock at March 31, 2022 | 76,705 | $ | 24.55 | 5.0 |
(Dollars in thousands) | ||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2017 | 2016 | 2017 | 2016 | |||||||||||||
Other Noninterest Expense | ||||||||||||||||
Non-employee compensation | $ | 101 | $ | 135 | $ | 301 | $ | 403 | ||||||||
Printing and supplies | 107 | 88 | 310 | 296 | ||||||||||||
Postage | 36 | 55 | 166 | 158 | ||||||||||||
Telephone | 99 | 108 | 287 | 289 | ||||||||||||
Charitable contributions | 30 | 18 | 111 | 87 | ||||||||||||
Dues and subscriptions | 54 | 56 | 172 | 148 | ||||||||||||
Loan expenses | 110 | 87 | 271 | 231 | ||||||||||||
Meals and entertainment | 41 | 36 | 108 | 94 | ||||||||||||
Travel | 36 | 41 | 105 | 110 | ||||||||||||
Training | - | 10 | 20 | 28 | ||||||||||||
Miscellaneous | 179 | 236 | 581 | 698 | ||||||||||||
Total Other Noninterest Expense | $ | 793 | $ | 870 | $ | 2,432 | $ | 2,542 |
with any precision is difficult and depends on many factors beyond our control.
On October 31, 2014, the Company completed its merger with FedFirst Financial Corporation (“FedFirst” or the “merger”), the holding company for First Federal Savings Bank, a community bank basedagency located in Monessen, Pennsylvania. The merger resulted in the addition of five branches and expanded the Company’s reach into Fayette and Westmoreland counties in southwestern Pennsylvania.
The Bank’s website address is www.communitybank.tv. Information on the website is not and should not be considered a part of this Form 10-Q.
Washington County.
March 31, 2022 compared to the three months ended March 31, 2021.
Financial institutions like us, in general, are significantly affected by economic conditions, competition, and the monetary and fiscal policies of the federal government. Lending activities are influenced by the demand for and supply of housing, competition among lenders, interest rate conditions, and funds availability. Our operations and lending are principally concentrated in the southwestern Pennsylvania and Ohio Valley market area.
Statementareas.
Three Months Ended | ||||||||||||||
March 31, | ||||||||||||||
2022 | 2021 | |||||||||||||
(Dollars in thousands) | ||||||||||||||
Interest Income (GAAP) | $ | 10,616 | $ | 10,988 | ||||||||||
Adjustment to FTE Basis | 40 | 40 | ||||||||||||
Interest Income (FTE) (Non-GAAP) | 10,656 | 11,028 | ||||||||||||
Interest Expense (GAAP) | 723 | 1,011 | ||||||||||||
Net Interest Income (FTE) (Non-GAAP) | $ | 9,933 | $ | 10,017 | ||||||||||
Net Interest Rate Spread (GAAP) | 2.98 | % | 2.91 | % | ||||||||||
Adjustment to FTE Basis | 0.01 | 0.01 | ||||||||||||
Net Interest Rate Spread (FTE) (Non-GAAP) | 2.99 | 2.92 | ||||||||||||
Net Interest Margin (GAAP) | 3.08 | % | 3.04 | % | ||||||||||
Adjustment to FTE Basis | 0.02 | 0.01 | ||||||||||||
Net Interest Margin (FTE) (Non-GAAP) | 3.10 | 3.05 |
March 31, 2022 | December 31, 2021 | ||||||||||
(Dollars in thousands) | |||||||||||
Allowance for Loan Losses (Numerator) | $ | 11,595 | $ | 11,582 | |||||||
Total Loans | 1,020,642 | $ | 1,020,796 | ||||||||
PPP Loans | (8,242) | (24,523) | |||||||||
Total Loans, Excluding PPP Loans (Non-GAAP) (Denominator) | $ | 1,012,400 | $ | 996,273 | |||||||
Allowance for Loan Losses to Total Loans (GAAP) | 1.14 | % | 1.13 | % | |||||||
Allowance for Loan Losses to Total Loans, Excluding PPP Loans (Non-GAAP) | 1.15 | % | 1.16 | % |
March 31, 2022 | December 31, 2021 | ||||||||||
(Dollars in thousands, except share and per share data) | |||||||||||
Stockholders' Equity (GAAP) | $ | 122,156 | $ | 133,124 | |||||||
Goodwill and Other Intangible Assets, Net | (14,582) | (15,027) | |||||||||
Tangible Common Equity or Tangible Book Value (Non-GAAP) (Numerator) | $ | 107,574 | $ | 118,097 | |||||||
Common Shares Outstanding (Denominator) | 5,156,897 | 5,260,672 | |||||||||
Book Value per Common Share (GAAP) | $ | 23.69 | $ | 25.31 | |||||||
Tangible Book Value per Common Share (Non-GAAP) | $ | 20.86 | $ | 22.45 |
2021. The change is primarily due to increases in cash and due from banks and in securities.
Investment securities classified as available-for-saledetailed in the below Securities section.
Loans, net, increased $21.6bank stocks.
Premises and equipment, net, increased $2.4 million, or 17.2%, to $16.6that are considered troubled debt restructurings, were $7.3 million at September 30, 2017March 31, 2022 compared to $14.1$7.3 million at December 31, 2016. This is due2021. Nonperforming loans to the additions relatedtotal loans ratio was 0.72% at March 31, 2022 compared to the new Operations Center that was placed into service in the second quarter. Total premises and equipment capitalized for the new Operations Center totaled $5.3 million.
Liabilities. Total liabilities increased $58.6 million, or 7.7%,0.71% at December 31, 2021.
Total deposits2021 due to amortization expense of $445,000 recognized during the period.
three months ended December 31, 2021.
Stockholders’ Equity. Stockholders’ equity increased $3.7 million, or 4.1%, to $93.2 millionFebruary 15, 2022
this Report.
2021
March 31, 2021. Net interest margin (FTE) (Non-GAAP) increased 5 basis points (“bps”) to 3.10% for the three months ended March 31, 2022 compared to 3.05% the three months ended March 31, 2021. Net interest margin (GAAP) increased to 3.08% for the three months ended March 31, 2022 compared to 3.04% for the three months ended March 31, 2021. Rate/Volume Analysis.The following table presents the effects of changing rates and volumes on our net interest income for the periods indicated. Off-Balance Sheet Arrangements. March 31, 2022 and December 31, 2021. The Company’s most liquid assets are cash and due from banks, which totaled both March 31, 2022 and December 31, 2021.increased $377,000,decreased $84,000, or 5.4%0.8%, to $7.4$9.9 million for the three months ended September 30, 2017March 31, 2022 compared to $7.0$10.0 million for the three months ended September 30, 2016.increased $529,000,decreased $372,000, or 6.9%3.4%, to $8.2$10.6 million for the three months ended September 30, 2017March 31, 2022 compared to $7.7$11.0 million the three months ended March 31, 2021.September 30, 2016. Interest income on loans increased $366,000March 31, 2022 compared to $10.1 million for the three months ended September 30, 2017March 31, 2021. The average balance of loans decreased $22.6 million and the average yield decreased 15 bps to 3.85% compared to the three months ended September 30, 2016. AverageMarch 31, 2021.increased by $13.0 million during the current quarter. The loan portfolio had an increase of 12 basis points in yield. Contributing to the yield increase this quarter was the accretion on the acquired loan portfolio credit mark. The positive impact of the accretion$445,000 for the three months ended September 30, 2017 was $127,000, or 8 basis points,March 31, 2022 and contributed 13 bps to loan yield, compared to $87,000, or 5 basis points,$676,000 for the three months ended September 30, 2016. March 31, 2021, which contributed 5 bps to loan yield.remainingimpact of the accretion of the credit mark balance foron acquired loansloan portfolios was $994,000 as of September 30, 2017. Interest income on taxable securities increased $99,000 mainly due to an increase of $29.3 million in the average balance for taxable securities in the current period. The increase in the average balance offset a decrease of 32 basis points in yield on taxable securities. This is a result of new purchases with lower prevailing yields replacing security calls and maturities with higher yields within the portfolio. Interest income on Federal funds sold increased to $64,000$56,000 for the three months ended September 30, 2017March 31, 2022 compared to $3,000$138,000 for the three months ended September 30, 2016. This is the result of the increase in interest ratesMarch 31, 2021, or 2 bps in the last year and the increasescurrent period compared to 6 bps in the average interest-earning balances of $23.0 million as a result of deposit growthprior period.September 30, 2017. In addition, other interest and dividend income increased $35,000 as a result of increased interest earned with correspondent deposit banks and FHLB dividends in the current period. Interest income on securities exempt from federal tax decreased $32,000 dueMarch 31, 2022 compared to deploying proceeds from security calls and maturities into lower yielding taxable security purchases in the current period. There was a decrease of $2.0 million in the average balance on securities exempt from federal tax and a decrease of 30 basis points in yield as a result of security calls and maturities that had higher yields.Interest expense increased $152,000, or 21.5%, to $860,000$646,000 for the three months ended September 30, 2017 comparedMarch 31, 2021 driven by a $93.0 million increase in average investment securities balances and 42 bps decrease in average yield.$708,000$723,000 for the three months ended September 30, 2016. March 31, 2022 compared to $1.0 million for the three months ended March 31, 2021.increased $163,000 duedecreased $417,000, or 44.0%, to $530,000 for the three months ended March 31, 2022 compared to $947,000 for the three months ended March 31, 2021. While average interest-earning deposits decreased $38.6 million compared to the three months ended March 31, 2021, controlling the deposit cost structure as deposit balances decreased combined with non-renewal or repricing of higher-cost time deposit resulted in an increase18interest-bearing deposits of $57.4 million, primarily duecost compared to increases in interest-bearing demand deposits,the three months ended March 31, 2021. In addition, average time deposits and savings accounts. Thethe related average cost decreased $55.1 million and 30 bps, respectively.table presentstables present information regarding average balances of assets and liabilities, the total dollar amounts of interest income and dividends from average interest-earning assets, the total dollar amounts of interest expense on average interest-bearing liabilities, and the resulting average yields and costs. Average balances are derived from daily balances over the periods indicated. The yields set forth below include the effect of deferred fees, discounts, and premiums that are amortized or accreted to interest income or interest expense. Tax-equivalentFTE yield adjustments have been made for tax exempt loan and securities interest income utilizing a marginal federal income tax rate of 34%.21.0% for the periods presented. As such, amounts will not agree to income as reported in the consolidated financial statements. Average balances for loans are net of the allowance for loan losses, but include non-accrual loans. The yields and costs for the periods indicated are derived by dividing annualized income or expense by the average balances of assets or liabilities, respectively, for the periods presented. (Dollars in thousands) (Unaudited) Three Months Ended September 30, 2017 2016 Interest Interest Average and Yield/ Average and Yield/ Balance Dividends Cost (1) Balance Dividends Cost (1) Assets: Interest-Earning Assets: Loans, Net $ 684,384 $ 7,480 4.34 % $ 671,346 $ 7,120 4.22 % Investment Securities Taxable 80,791 386 1.91 51,460 287 2.23 Exempt From Federal Tax 37,390 340 3.64 39,428 388 3.94 Other Interest-Earning Assets 32,553 139 1.69 9,296 43 1.84 Total Interest-Earning Assets 835,118 8,345 3.96 771,530 7,838 4.04 Noninterest-Earning Assets 61,859 54,484 Total Assets $ 896,977 $ 826,014 Liabilities and Stockholders' equity: Interest-Bearing Liabilities: Interest-Bearing Demand Deposits $ 138,742 92 0.26 % $ 112,679 49 0.17 % Savings 131,420 61 0.18 121,439 56 0.18 Money Market 135,214 88 0.26 138,033 87 0.25 Time Deposits 160,456 479 1.18 136,258 365 1.07 Total Interest-Bearing Deposits 565,832 720 0.50 508,409 557 0.44 Borrowings 50,741 140 1.09 57,791 151 1.04 Total Interest-Bearing Liabilities 616,573 860 0.55 566,200 708 0.50 Noninterest-Bearing Demand Deposits 183,061 165,422 Other Liabilities 4,361 4,199 Total Liabilities 803,995 735,821 Stockholders' Equity 92,982 90,193 Total Liabilities and Stockholders' Equity $ 896,977 $ 826,014 Net Interest Income $ 7,485 $ 7,130 Net Interest Rate Spread (2) 3.41 % 3.54 % Net Interest-Earning Assets (3) $ 218,545 $ 205,330 Net Interest Margin (4) 3.56 3.68 Return on Average Assets 0.91 0.76 Return on Average Equity 8.81 6.95 Average Equity to Average Assets 10.37 10.92 Average Interest-Earning Assets to Average Interest-Bearing Liabilities 135.45 136.26 Three Months Ended March 31, 2022 2021 Average
BalanceInterest
and
DividendsAverage
BalanceInterest
and
Dividends(Dollars in thousands) (Unaudited) Assets: Interest-Earning Assets: $ 1,009,210 $ 9,573 3.85 % $ 1,031,853 $ 10,168 4.00 % Debt Securities Taxable 215,906 905 1.68 122,883 646 2.10 Tax Exempt 10,195 84 3.30 12,943 96 2.97 Marketable Equity Securities 2,693 22 3.27 2,632 20 3.04 Interest Bearing Deposits at Other Banks 59,296 22 0.15 157,962 36 0.09 Other Interest-Earning Assets 3,483 50 5.82 3,909 62 6.43 Total Interest-Earning Assets 1,300,783 10,656 3.32 1,332,182 11,028 3.36 Noninterest-Earning Assets 122,288 92,550 Total Assets $ 1,423,071 $ 1,424,732 Liabilities and Stockholders' Equity: Interest-Bearing Liabilities: Interest-Bearing Demand Deposits $ 276,603 48 0.07 % $ 259,065 77 0.12 % Savings 243,786 19 0.03 239,850 32 0.05 Money Market 192,425 41 0.09 197,395 98 0.20 Time Deposits 132,015 422 1.30 187,114 740 1.60 Total Interest-Bearing Deposits 844,829 530 0.25 883,424 947 0.43 Short-Term Borrowings Securities Sold Under Agreements to Repurchase 37,884 19 0.20 41,094 23 0.23 Other Borrowings 17,604 174 4.01 7,200 41 2.31 Total Interest-Bearing Liabilities 900,317 723 0.33 931,718 1,011 0.44 Noninterest-Bearing Demand Deposits 384,188 349,108 Other Liabilities 8,554 8,869 Total Liabilities 1,293,059 1,289,695 Stockholders' Equity 130,012 135,037 Total Liabilities and Stockholders' Equity $ 1,423,071 $ 1,424,732 $ 9,933 $ 10,017 2.99 % 2.92 % $ 400,466 $ 400,464 3.08 3.04 3.10 3.05 0.87 0.81 9.50 8.54 Average Equity to Average Assets 9.14 9.48 Average Interest-Earning Assets to Average Interest-Bearing Liabilities 144.48 142.98 PPP Loans $ 14,673 $ 445 12.30 $ 56,945 $ 676 4.81 (1)Annualized.(2)Net interest rate spread represents the difference between the weighted average yield on interest-earning assets and the weighted average cost of interest-bearing liabilities.(3)Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities.(4)Net interest margin represents net interest income divided by average total interest-earning assets. Interest income and yields are on a fully tax equivalent basis utilizing a marginal tax rate of 34%.Tax-equivalentFTE yield adjustments have been made for tax exempt loan and securities income utilizing a marginal federal income tax rate of 34%21.0%. The volume column shows the effects attributable to changes in volume (changes in volume multiplied by prior rate). The rate column shows the effects attributable to changes in rate (changes in rate multiplied by prior volume). For purposes of this table, changes attributable to both rate and volume, which cannot be segregated, have been allocated proportionately based on the changes due to rate and the changes due to volume. The total column represents the sum of the prior columns. (Dollars in thousands) (Unaudited) Three Months Ended September 30, 2017 Compared To Three Months Ended September 30, 2016 Increase (Decrease) Due to Volume Rate Total Interest and Dividend Income: Loans, net $ 155 $ 205 $ 360 Investment Securities: Taxable 145 (46 ) 99 Exempt From Federal Tax (19 ) (29 ) (48 ) Other Interest-Earning Assets 100 (4 ) 96 Total Interest-Earning Assets 381 126 507 Interest Expense: Deposits 81 82 163 Borrowings (18 ) 7 (11 ) Total Interest-Bearing Liabilities 63 89 152 Change in Net Interest Income $ 318 $ 37 $ 355 Increase (Decrease) Due to Volume Rate Total (Dollars in thousands) (Unaudited) Interest and Dividend Income: Loans, net $ (218) $ (377) $ (595) Debt Securities: Taxable 408 (149) 259 Exempt From Federal Tax (22) 10 (12) Marketable Equity Securities 1 1 2 Other Interest-Earning Assets (6) (6) (12) Total Interest-Earning Assets 134 (506) (372) Interest Expense: Deposits (40) (377) (417) Short-Term Borrowings: Securities Sold Under Agreements to Repurchase (1) (3) (4) Other Borrowings 88 45 133 Total Interest-Bearing Liabilities 47 (335) (288) Change in Net Interest and Dividend Income $ 87 $ (171) $ (84) $300,000primarily due to consistent loan balances between the periods and no significant changes in qualitative factors.September 30, 2017March 31, 2022, compared to $450,000$3.2 million for the three months ended September 30, 2016. Net charge-offs for the three months ended September 30, 2017 were $227,000, which included $149,000 of net charge-offs on automobile loans, comparedMarch 31, 2021. $175,000 of net charge-offs for the three months ended September 30, 2016, which included $145,000 of net charge-offs on automobile loans. The increase in net charge-offs during the current period was due to charge-offs of $67,000 for residential mortgages and $52,000 for consumer loans. Management analyzes the loan portfolio on a quarterly basis to determine the adequacy of the allowance for loan losses and the need for additional provisions for loan losses. This was due to improvements in the loan department along with loan personnel experience, and improvements in the local economy which had a positive impact on the qualitative factors within the allowance calculation.Noninterest Income. Noninterest income decreased $3,000, or 0.2%, and remained constant at $1.8 million for the three months ended September 30, 2017 and 2016. There was a decreaseMarch 31, 2022 compared to $1.6 million for the three months ended March 31, 2021. The increase in the net gains on the sales of residential mortgage loans of $113,000. The decrease in gainsinsurance commissions was primarily due to a decrease in the number of loans originated and subsequently sold to the FHLB as part of the Mortgage Partnership Finance® (“MPF®”) program. The MPF® program enables member financial institutions to offer competitive interest rates for fixed-rate mortgage loans without assuming any of the interest rate risk associated with a long-term asset. Net gains on the sales of investments decreased $12,000 due to the sale of equity securities in 2016. These sales were transacted to recognize capital gains that will be offsetdriven by a capital loss carry forward deferred tax asset that was acquired in the merger with FedFirst Financial Corporation in October 2014 (“merger”). The capital loss carry forward deferred tax asset was fully recognized in the prior quarter. In addition, there was a decrease of $6,000 in income from bank-owned life insurance due to lower crediting rates. Mainly offsetting the decreases were insurance commissions from Exchange Underwriters that increased $82,000 due to increased commercial lines commission and fee income and contingency fees received in the current period.of $114,000. Contingency fees are profit sharing commissions that are contingent upon several factors including, but not limited to, eligible written premiums, earned premiums, incurred losses, policy cancellations and stop loss charges. charges which resulted from the higher than lock-in amounts received.gains(loss) gain on purchased tax credits increased $14,000 duesecurities decreased $454,000 to a $7,000 loss for the purchased Pennsylvania shares tax credits beingthree months ended March 31, 2022 compared to a $447,000 gain for the three months ended March 31, 2021. The change was driven by a $229,000 decrease in fair market value of equity securities between the three months ended March 31, 2021 and three months ended March 31, 2022, in addition to a $225,000 net gain on sale of debt securities during the three months ended March 31, 2021, compared to no gain recognized in the current period. three months ended March 31, 2022.commissions increased $13,000 dueincome was $65,000 for the three months ended March 31, 2022 compared to miscellaneous income$180,000 for the three months ended March 31, 2021, the Company recognized from forfeited funds from an employee flexible spending account (“FSA”) from prior years. Service feesa recapture of a temporary impairment on deposit accounts increased $11,000 due to increased non-sufficient funds (“NSF”) fees due to customer overdrafts of deposit accounts and check card feesmortgage servicing rights in the current quarter.quarter of $59,000, compared to the prior period recapture of temporary impairment of $172,000.$268,000,$739,000, or 4.3%7.9%, to $5.9$8.7 million for the three months ended September 30, 2017March 31, 2022 compared to $6.2$9.4 million for the three months ended September 30, 2016. Other real estate owned expense decreased $353,000March 31, 2021, primarily due to the final resolutionsimplementation of loan collection efforts throughbranch optimization initiatives completed during 2021 which established a lower expense base. Partially offsetting the sale of a mineral rights interest for $186,000, bankruptcy court settlement for $86,000 and mortgage insurance proceeds for $85,000. The aforementioned items were proceeds from previously sold OREO properties. The additional proceeds represent contingent gains recorded by the Company when the proceeds were received. These items are considered non-recurring. Other noninterestlower expense decreased $77,000 primarily due to reduced overdraft and debit card fraud losses, postage, employee training, telephone and travel. Legal and professional fees decreased $59,000 due to the above mentioned mortgage insurance proceeds, in which part of the insurance proceeds were utilized to offset legal fees attributed to the problem loan relationship. Contracted services decreased $36,000 as a result of combining services at the new Ralph J. Sommers Jr. Operations Center (“Operations Center”). Occupancy decreased $18,000 primarily due to decreases in rent expense and accelerated depreciation taken on leasehold improvementsbase in the Bank’s former operations center that did not transfer over to the new Operations Centerfirst quarter were investment in the current quarter. The new Operations Center was completed and placed into bank operations during the second quarter. The Federal Deposit Insurance Corporation (“FDIC”) assessment expense decreased $8,000 due to an assessment factor reduction by the FDIC in the computation of the insurance assessment. Partially offsetting these favorable variances were salariesexecutive leadership tasked with implementing growth initiatives.that increased $221,000 primarily duedecreased $329,000 to normal salary increases, employee group health insurance, retirement benefits expense and employee stock options. Pennsylvania shares tax, which is calculated based on the Bank’s stockholders’ equity, increased $48,000 due to the increase in equity that was calculated on the current year shares tax return. Advertising expense increased $8,000 due to the Bank’s current marketing initiatives.Income Tax Expense. Income taxes increased $303,000 to $910,000$4.6 million for the three months ended September 30, 2017March 31, 2022 compared to $607,000$4.9 million for the three months ended September 30, 2016.March 31, 2021. The effective tax ratedecrease was primarily related to prior year branch optimization, including the consolidation of six branches in June 2021 and the divestiture of two branches in December 2021, partially offset by costs for new strategic executive team members hired during the three months ended March 31, 2022.September 30, 2017 was 30.6%March 31, 2022 compared to 27.8%$710,000 for the three months ended September 30, 2016.March 31, 2021. The increase in income taxes wasdecrease is primarily due to an increase of $792,000 in pre-tax income. The increasebranch consolidations and divestitures in the effectiveprior year, reducing the Company's physical footprint, and partially offset by increased maintenance costs due to improvements at remaining locations.rateexpense was $803,000 for the three months ended March 31, 2022 compared to income tax expense of $911,000 for the three months ended March 31, 2021. This change was primarily related to a change in the securities portfolio composition of new purchases of taxable securities replacing tax-exempt security calls and maturities within the portfolio. In addition, the capital loss carry forward deferredprior period income tax asset has been fully recognized and the expiration of the low income housingadjustment that resulted from amended tax credit program in the prior quarter, which attributed to the increase in both income taxes and the effective tax rate.Results of Operations for the Nine Months Ended September 30, 2017 and 2016Overview. Net income increased $11,000 and remained constant at $5.6 million, for the nine months ended September 30, 2017 and 2016, respectively.Net Interest Income. Net interest income decreased $161,000 , or 0.7%, to $21.5 million for the nine months ended September 30, 2017 compared to $21.6 million for the nine months ended September 30, 2016.Interest and dividend income increased $196,000, or 0.8%, to $24.0 million for the nine months ended September 30, 2017 compared to $23.8 million for the nine months ended September 30, 2016. Interest income on taxable securities increased $215,000 despite a decrease of 38 basis points in yield from new purchases with lower prevailing yields. The average balance for taxable securities increased $25.9 million for the nine months ended September 30, 2017. Federal Funds sold increased $104,000 for the nine months ended September 30, 2017. This is the direct result of the end of the historically low interest rates in the last year and the increases in the average interest-earning balances to $16.1 millionreturns as a result of deposit growth for the nine months ended September 30, 2017. Other interest and dividend income increased $82,000 primarily due to increased interest earned with correspondent deposit banks and FHLB dividends in the current period. Interest income on securities exempt from federal tax decreased $122,000 due to deploying proceeds from security calls and maturities into purchasing taxable securities in the current year. There was a decrease of $2.7 million in the average balance on securities exempt from federal tax and a decrease of 38 basis points in yield as a result of security calls and maturities that had higher yields. Interest income on loans decreased $83,000 primarily due to accretion on the acquired loan portfolio credit mark for the nine months ended September 30, 2017 of $533,000, or 16 basis points compared to $860,000, or 26 basis points for the nine months ended September 30, 2016. There was an increase in average loans outstanding of $471,000. The increase in average loans was due to the loan originations within the entire loan portfolio in the later part of the current period.
CARES Act.Interest expense increased $357,000, or 16.9%, to $2.5 million for the nine months ended September 30, 2017 compared to $2.1 million for the nine months ended September 30, 2016. Interest expense on deposits increased $372,000 due to recent rate increases and an increase in average interest-bearing deposits of $33.7 million which we attribute primarily to time deposits, interest-bearing demand deposits and savings accounts. The average cost of interest-bearing deposits increased 7 basis points. In addition, short-term borrowings increased $9,000 in the current period due to increased interest rates on securities sold under agreements to repurchase. Interest expense on other borrowed funds decreased $22,000 due to a decrease in long-term borrowings as a result of a FHLB long-term borrowing for $3.5 million that matured in the current period.Average Balances and Yields. The following table presents information regarding average balances of assets and liabilities, the total dollar amounts of interest income and dividends from average interest-earning assets, the total dollar amounts of interest expense on average interest-bearing liabilities, and the resulting average yields and costs. Average balances are derived from daily balances over the periods indicated. The yields set forth below include the effect of deferred fees, discounts, and premiums that are amortized or accreted to interest income or interest expense. Tax-equivalent yield adjustments have been made for tax exempt loan and securities income utilizing a marginal federal tax rate of 34%. Average balances for loans are net of the allowance for loan losses, but include non-accrual loans. The yields and costs for the periods indicated are derived by dividing income or expense by the average balances of assets or liabilities, respectively, for the periods presented and are expressed in annualized rates. (Dollars in thousands) (Unaudited) Nine Months Ended September 30, 2017 2016 Interest Interest Average and Yield/ Average and Yield/ Balance Dividends Cost (1) Balance Dividends Cost (1) Assets: Interest-Earning Assets: Loans, Net $ 673,922 $ 21,896 4.34 % $ 673,451 $ 21,998 4.36 % Investment Securities Taxable 79,432 1,133 1.90 53,580 918 2.28 Exempt From Federal Tax 36,177 987 3.64 38,902 1,172 4.02 Other Interest-Earning Assets 27,643 325 1.57 11,533 139 1.61 Total Interest-Earning Assets 817,174 24,341 3.98 777,466 24,227 4.16 Noninterest-Earning Assets 58,709 53,806 Total Assets $ 875,883 $ 831,272 Liabilities and Stockholders' equity: Interest-Bearing Liabilities: Interest-Bearing Demand Deposits $ 127,736 239 0.25 % $ 114,959 147 0.17 % Savings 128,583 177 0.18 123,079 169 0.18 Money Market 137,906 270 0.26 142,820 268 0.25 Time Deposits 159,232 1,364 1.15 138,917 1,094 1.05 Total Interest-Bearing Deposits 553,457 2,050 0.50 519,775 1,678 0.43 Borrowings 51,505 420 1.09 54,533 435 1.07 Total Interest-Bearing Liabilities 604,962 2,470 0.55 574,308 2,113 0.49 Noninterest-Bearing Demand Deposits 175,401 163,815 Other Liabilities 3,822 4,086 Total Liabilities 784,185 742,209 Stockholders' Equity 91,698 89,063 Total Liabilities and Stockholders' Equity $ 875,883 $ 831,272 Net interest income $ 21,871 $ 22,114 Net Interest Rate Spread (2) 3.43 % 3.67 % Net Interest-Earning Assets (3) $ 212,212 $ 203,158 Net Interest Margin (4) 3.58 3.80 Return on Average Assets 0.85 0.89 Return on Average Equity 8.12 8.34 Average Equity to Average Assets 10.47 10.71 Average Interest-Earning Assets to Average Interest-Bearing Liabilities 135.08 135.37 (1)Annualized.(2)Net interest rate spread represents the difference between the weighted average yield on interest-earning assets and the weighted average cost of interest-bearing liabilities.(3)Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities.(4)Net interest margin represents net interest income divided by average total interest-earning assets. Interest income and yields are on a fully tax equivalent basis utilizing a marginal tax rate of 34%.Rate/Volume Analysis. The following table presents the effects of changing rates and volumes on our net interest income for the periods indicated. The volume column shows the effects attributable to changes in volume (changes in volume multiplied by prior rate). The rate column shows the effects attributable to changes in rate (changes in rate multiplied by prior volume). For purposes of this table, changes attributable to both rate and volume, which cannot be segregated, have been allocated proportionately based on the changes due to rate and the changes due to volume. The total column represents the sum of the prior columns. (Dollars in thousands) (Unaudited) Nine Months Ended September 30, 2017 Compared To Nine Months Ended September 30, 2016 Increase (Decrease) Due to Volume Rate Total Interest and Dividend Income: Loans, net $ (1 ) $ (101 ) $ (102 ) Investment Securities: Taxable 387 (172 ) 215 Exempt From Federal Tax (79 ) (106 ) (185 ) Other Interest-Earning Assets 189 (3 ) 186 Total Interest-Earning Assets 496 (382 ) 114 Interest Expense: Deposits 87 285 372 Borrowings (23 ) 8 (15 ) Total Interest-Bearing Liabilities 64 293 357 Change in Net Interest Income $ 432 $ (675 ) $ (243 ) Provision for Loan Losses. The provision for loan losses decreased $580,000 to $1.0 million, for the nine months ended September 30, 2017, of which $250,000 was attributed to the acquired loan portfolio, compared to $1.6 million of provision for loan losses for the nine months ended September 30, 2016. Net charge-offs for the nine months ended September 30, 2017 were $667,000, which included $435,000 of net charge-offs on automobile loans, compared to net charge-offs of $625,000 for the nine months ended September 30, 2016, which included $375,000 of net charge-offs on automobile loans. Management analyzes the loan portfolio on a quarterly basis to determine the adequacy of the allowance for loan losses and the need for an increase or reduction in provision for loan losses for the nine months ended September 30, 2017. The decrease in provision is mainly attributed to loan payoffs and improving credit quality of impaired loans resulting in an average balance decrease of approximately $4.0 million in impaired loans for the nine months ended September 30, 2017 as compared to the nine months ended September 30, 2016. There was sizable loan growth and increased performance in substandard loans which resulted in upgrades to credit quality risk ratings as compared to the prior year. As the acquired loan portfolio has loan payoffs, paydowns and accretion of the credit mark, the need for additional provision may be required based on our loan loss analysis.Noninterest Income. Noninterest income increased $324,000, or 5.9%, to $5.9 million for the nine months ended September 30, 2017 compared to $5.5 million at September 30, 2016. There was a $395,000 increase in insurance commissions from Exchange Underwriters due to additional contingency fees received and an increase in commercial commission and fee income received in the current period. Net gains on the sales of investments increased $52,000 due to the sale of equity securities. These sales were transacted to recognize capital gains that will be offset by a capital loss carry forward deferred tax asset that was acquired in the merger. The capital loss carry forward deferred tax asset has been fully recognized in the current period. Net gains on purchased tax credits increased $43,000 due to purchased Pennsylvania shares tax credits being recognized in the current period. Service fees on deposit accounts increased $28,000 primarily due to increased NSF fees due to customer overdrafts of deposit accounts and check card fees. There was a decrease in the net gains on sales of residential mortgage loans of $170,000. The decrease in gains was primarily due to a decrease in the number of loans originated and subsequently sold to the FHLB as part of the Mortgage Partnership Finance® (“MPF®”) program. The MPF® program enables member financial institutions to offer competitive interest rates for fixed-rate mortgage loans without assuming any of the interest rate risk associated with a long-term asset. Income from bank-owned life insurance decreased $13,000 due to lower crediting rates in the current period. Other miscellaneous income decreased $6,000 due to student loan servicing fees and an increase in amortization on mortgage servicing rights related to loans sold to the FHLB. This was partially offset by an increase in the servicing income received from mortgage loans sold to the FHLB as part of the MPF® program. Other commissions decreased $5,000 primarily due to decreases in merchant services and check sales fees in the current period, partially offset by an increase in miscellaneous income recognized from forfeited funds from an employee FSA from prior years.Noninterest Expense. Noninterest expense increased $651,000, or 3.7%, to $18.4 million for the nine months ended September 30, 2017 compared to $17.8 million for the nine months ended September 30, 2016. Salaries and employee benefits increased $480,000, primarily due to additional employees, normal salary increases, retirement benefits, employee stock options and employee group health insurance. This was partially offset by a decrease in restricted stock awards expense. Occupancy and equipment increased $222,000 and $59,000, respectively, primarily due to accelerated depreciation taken on leasehold improvements in the Bank’s former operations center that did not transfer over to the new Operations Center that was placed into service in the prior quarter. In addition, the new Operations Center increased depreciation during the current period. Other increases for occupancy were related to real estate taxes, moving expenses, utilities and property insurance. Equipment expense increases were mainly due to equipment purchases and new maintenance contracts for the Operations Center. Bankcard processing expense increased $25,000 due to the increased number of automatic teller transactions (“ATM”) in the current period. Pennsylvania shares tax, which is calculated based on the Bank’s stockholders’ equity, increased $19,000 due to the increase in equity that was calculated on the current year shares tax return. Other real estate owned expense was $343,000 of income in the current period compared to $531,000 of income in the prior period resulting in an increase of $188,000 in expense. This change is primarily due to the $566,000 pre-tax gain recognized due to the foreclosure procedures on two commercial real estate loans that moved into other real estate owned properties in the first quarter of 2016. This was partially offset due to the final resolutions of loan collection efforts through the sale of a mineral rights interest, bankruptcy court settlement and mortgage insurance proceeds. These items are considered non-recurring. Other noninterest expense decreased $110,000 primarily due to decreases in various miscellaneous expenses, such as other insurance, other losses, non-employee restricted stock awards and a Pennsylvania state sales tax refund as a result of a Bank initiated reverse audit. The FDIC assessment decreased $86,000 due to an assessment factor reduction by the FDIC in the computation of the insurance assessment. Legal and professional fees decreased $71,000 due to the previously mentioned mortgage insurance proceeds, in which part of the insurance proceeds were utilized to offset legal fees attributed to the problem loan relationship. Advertising decreased $39,000 related to decreases in print/media advertising and promotional items as a cost savings initiative.Income Tax Expense. Income taxes increased $81,000 to $2.3 million for the nine months ended September 30, 2017 compared to $2.3 million for the nine months ended September 30, 2016. The effective tax rate for the nine months ended September 30, 2017 was 29.6% compared to 28.9% for the nine months ended September 30, 2016. The increase in income taxes was primarily due to an increase of $92,000 in pre-tax income and the expiration of the low income housing tax credit program. The increase in the effective tax rate was related to the decrease in tax exempt income, the expiration of the low income housing tax credit program and the capital loss carry forward deferred tax asset that has been fully recognized, partially offset by the favorable tax preference charitable donation of a former First Federal Savings Bank building to the City of Monessen, Pennsylvania in the current period.87 in the Notes to Consolidated Financial Statements of this report for a summary of commitments outstanding as of September 30, 2017.September 30, 2017March 31, 2022 to satisfy its short- and long-term liquidity needs at that date.
needs.$43.7$123.6 million at September 30, 2017.March 31, 2022. The levels of these assets depend on our operating, financing, lending and investing activities during any given period. Unpledged securities, which provide an additional source of liquidity, totaled $20.0$83.7 million at September 30, 2017.March 31, 2022. In addition, at September 30, 2017,March 31, 2022, the Company had the ability to borrow up to $286.3$430.9 million from the FHLB of Pittsburgh, of which $24.5$347.8 million was outstanding and $48.9 million was utilized toward standby letters of credit.is available. The Company also has the ability to borrow up to $88.3$102.7 million million from the FRB through its Borrower-In-Custody line of credit agreement and $40.0 million fromthe Company also maintains multiple line of credit arrangements with various unaffiliated banks nonetotaling $50.0 million as of which were outstanding.September 30, 2017, time deposits due within one year of that date totaled $43.9March 31, 2022, $72.2 million, or 27.3%55.9% of total time deposits.deposits mature within one year. If these time deposits do not remain with the Company, the Company will be required to seek other sources of funds. Depending on market conditions, the Company may be required to pay higher rates on such deposits or other borrowings than it currently pays on these certificates of deposit.time deposits. The Company believes, however, based on past experience that a significant portion of its certificates of deposittime deposits will remain with it, either as certificatesCB Financial is a separate legal entity from the Bank and must provide for its own liquidity to pay any dividends to its shareholders and for other corporate purposes. Its primary source of liquidity is dividend payments it receives from the Bank. The Bank’s ability to pay dividends to CB Financial is subject to regulatory limitations. At September 30, 2017, CB Financial (on an unconsolidated, stand-alone basis) had liquid assets of $1.8 million.Capital Management. The Company andareand must provide for its own liquidity to pay any dividends to its shareholders and for other corporate purposes. Its primary source of liquidity is dividend payments it receives from the Bank. The Bank’s ability to pay dividends to CB Financial is subject to regulatory limitations. At March 31, 2022, CB Financial (on an unconsolidated, stand-alone basis) had liquid assets of $18.3 million. The ability to pay future dividends or conduct stock repurchases may be limited under applicable banking regulations and regulatory policies due to expected losses for future periods and/or the inability to upstream funds from the Bank to the Company as a result of lower income or regulatory capital levels. The capital conservation buffer, which is composed of common equity Tier I capital, began on January 1, 2017 at the 0.625% level and will be phased in over a three year period (increasing by that amount on each January 1, until it reaches 2.5% on January 1, 2019).September 30, 2017March 31, 2022 and December 31, 2016,2021, the CompanyBank was categorized as well capitalized“well capitalized” under the regulatory framework for prompt corrective action. At March 31, 2022, the Bank's capital ratios were not affected by loans modified in accordance with Section 4013 of the CARES Act. In addition, PPP loans received a zero-percent risk weight under the regulatory capital rules regardless of whether they were pledged as collateral to the Federal Reserve Bank's PPP lending facility, but were included in the Bank's leverage ratio requirement due to the Bank not pledging the loans as collateral to the PPP lending facility.March 31, 2022 December 31, 2021 Amount Ratio Amount Ratio (Dollars in thousands) Common Equity Tier 1 (to risk weighted assets) Actual $ 115,291 11.99 % $ 113,086 11.95 % For Capital Adequacy Purposes 43,264 4.50 42,571 4.50 To Be Well Capitalized 62,492 6.50 61,491 6.50 Tier 1 Capital (to risk weighted assets) Actual 115,291 11.99 113,086 11.95 For Capital Adequacy Purposes 57,685 6.00 56,761 6.00 To Be Well Capitalized 76,914 8.00 75,682 8.00 Total Capital (to risk weighted assets) Actual 126,886 13.20 124,668 13.18 For Capital Adequacy Purposes 76,914 8.00 75,682 8.00 To Be Well Capitalized 96,142 10.00 94,602 10.00 Tier 1 Leverage (to adjusted total assets) Actual 115,291 8.19 113,086 7.76 For Capital Adequacy Purposes 56,306 4.00 58,307 4.00 To Be Well Capitalized 70,383 5.00 72,884 5.00 (Dollars in thousands) September 30, 2017 December 31, 2016 Amount Ratio Amount Ratio Common Equity Tier 1 (to risk weighted assets) Actual $ 84,325 13.18 % $ 81,845 13.38 % For Capital Adequacy Purposes 28,797 4.50 27,533 4.50 To Be Well Capitalized 41,596 6.50 39,770 6.50 Tier 1 Capital (to risk weighted assets) Actual 84,325 13.18 81,845 13.38 For Capital Adequacy Purposes 38,397 6.00 36,711 6.00 To Be Well Capitalized 51,195 8.00 48,947 8.00 Total Capital (to risk weighted assets) Actual 92,331 14.43 89,497 14.63 For Capital Adequacy Purposes 51,195 8.00 48,947 8.00 To Be Well Capitalized 63,994 10.00 61,184 10.00 Tier 1 Leverage (to adjusted total assets) Actual 84,325 9.48 81,845 9.80 For Capital Adequacy Purposes 35,567 4.00 33,390 4.00 To Be Well Capitalized 44,458 5.00 41,738 5.00 Company believes that asmajority of September 30, 2017, there was no material changethe Company’s assets and liabilities are monetary in nature. Consequently, the quantitative and qualitative disclosure aboutCompany’s most significant form of market risk data asis interest rate risk and a principal part of December 31, 2016, as disclosedits business strategy is to manage interest rate risk by reducing the exposure of net interest income to changes in market interest rates. Accordingly, the Company’s Board has established an Asset/Liability Management Committee, which is responsible for evaluating the interest rate risk inherent in the Company’s Annual Reportassets and liabilities, for determining the level of risk that is appropriate given the Company’s business strategy, operating environment, capital, liquidity and performance objectives; and for managing this risk consistent with the guidelines approved by the Board. Senior management monitors the level of interest rate risk and the Asset/Liability Management Committee meets on Form 10-Ka quarterly basis to review its asset/liability policies and position and interest rate risk position, and to discuss and implement interest rate risk strategies.year ended Decembersensitivity of our economic value of equity (“EVE”) ratio to movements in interest rates. EVE represents the present value of the expected cash flows from our assets less the present value of the expected cash flows arising from our liabilities. EVE attempts to quantify our economic value using a discounted cash flow methodology while the EVE ratio reflects that value as a form of capital ratio. The degree to which the EVE ratio changes for any hypothetical interest rate scenario from its base case measurement is a reflection of an institution’s sensitivity to interest rate risk.2016.2022.EVE EVE as a Percent of Portfolio Value of Assets Net Interest
Earnings at RiskChange in Interest Rates in Basis Points Dollar Amount Dollar Change Percent Change NPV Ratio Basis Point Change Dollar Amount Dollar Change Percent Change (Dollars in thousands) +300 $ 174,858 $ (10,610) (5.7) % 13.45 % 33 $ 44,517 $ 4,495 11.2 % +200 179,104 (6,364) (3.4) % 13.40 28 43,219 3,197 8.0 +100 182,216 (3,252) (1.8) % 13.25 13 41,195 1,173 2.9 Flat 185,468 — — % 13.12 — 40,022 — — (100) 176,073 (9,395) (5.1) % 12.18 (94) 37,814 (2,208) (5.5) CB Financial’sincluding CB Financial’s principal executive officerwith the participation of our Chief Executive Officer and principal financial officer, haveour Chief Financial Officer, evaluated the effectiveness of CB Financial’sour disclosure controls and procedures as of March 31, 2022. The term “disclosure controls and procedures”procedures,” as such term is defined in Rule 13a-15(c) promulgatedRules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). , means controls and other procedures of a company that are designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the company’s management, including its principal executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosure. Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives and management necessarily applies its judgment in evaluating the cost benefit relationship of possible controls and procedures.CB Financial’sour disclosure controls and procedures were effective for the purpose of ensuring that the information required to be disclosed in the reports that CB Financialthe Company files or submits under the Exchange Act with the Securities and Exchange Commission (the “SEC”)SEC (1) is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and (2) is accumulated and communicated to CB Financial’sour management, including its principal executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosures.CB Financial’sour internal control over financial reporting during the quarter ended September 30, 2017,March 31, 2022, that has materially affected, or is reasonably likely to materially affect, CB Financial’sour internal control over financial reporting.2016,2021, which could materially affect our business, financial condition or future results. The risks described in oursuch Annual Report on Form 10-K are not the only risks that we face. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially affect our business, financial condition and/or operating results.Not applicable.Period Average Price Paid per Share Total Number of Shares Purchased as
Part of the Publicly Announced ProgramApproximate Dollar Value of Shares That
May Yet Be Purchased Under the ProgramJanuary 1-31, 2022 28,600 $ 24.49 28,600 $ 2,682,598 February 1-28, 2022 103,240 25.99 103,240 $ — March 1-31, 2022 — — — $ — Total 131,840 $ 25.66 131,840 31.13.1 3.2 31.1 31.2 32.1 32.2Chief Financial Officer Certification pursuant to 18 U.S. C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002101.0101The following materials for the quarter ended September 30, 2017,March 31, 2022, formatted in XBRL (Extensible Business Reporting Language); the (i) the Consolidated StatementStatements of Financial Condition, (ii) the Consolidated StatementStatements of Operations,Income, (iii) the Consolidated StatementStatements of Comprehensive (Loss) Income , (iv) the Consolidated StatementStatements of Stockholders’ Equity, (v) the Consolidated StatementStatements of Cash Flows and (vi) the Notes to the Unaudited Consolidated Financial Statements (Unaudited)104 Cover Page Interactive Data File (Embedded within Inline XBRL contained in Exhibit 101) CB FINANCIAL SERVICES, INC. (Registrant) Date: November 8, 2017May 11, 2022/s/ Barron P. McCune, Jr.John H. MontgomeryBarron P. McCune, Jr.John H. MontgomeryPresident and Chief Executive Officer Date: November 8, 2017May 11, 2022/s/ Kevin D. LemleyJamie L. PrahKevin D. LemleyJamie L. PrahExecutive Vice President and Chief Financial Officer (Principal Financial Officer and Chief Accounting Officer) 46