(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically ~~and posted on its corporate Web site, if any,~~ every Interactive Data File required to be submitted ~~and posted~~ pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit ~~and post~~ such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer”, “accelerated filer”, “smaller reporting ~~company” or an~~company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act. ~~(check one):~~

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No ☒

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date. Common Shares, no par value, outstanding at November 3, ~~2017—10,170,935~~2022—15,727,360 shares

							September 30, 2022
	September 30, 2017			December 31, 2016			(Unaudited)			December 31, 2021
ASSETS
Cash and due from financial institutions	$	33,394		$	36,695		$	40,914		$	253,459
Securities available for sale		229,419			195,864
Restricted cash								-			10,780
Cash and cash equivalents								40,914			264,239
Investments in time deposits								1,479			1,730
Securities available-for-sale								602,046			559,874
Equity securities								2,028			1,072
Loans held for sale		4,662			2,268			3,491			1,972
Loans, net of allowance of $12,946 and $13,305		1,129,046			1,042,201
Loans, net of allowance of $27,773 and $26,641								2,300,841			1,971,238
Other securities		14,247			14,055			18,578			17,011
Premises and equipment, net		17,688			17,920			30,168			22,445
Accrued interest receivable		4,999			3,854			9,175			7,385
Goodwill		27,095			27,095			101,652			76,851
Other intangibles		1,360			1,784
Other intangible assets, net								11,554			7,581
Bank owned life insurance		24,981			24,552			53,291			46,641
Swap assets								18,448			11,072
Deferred taxes								25,118			980
Other assets		9,197			10,975			22,936			22,814
Total assets	$	1,496,088		$	1,377,263		$	3,241,719		$	3,012,905
LIABILITIES
Deposits
Noninterest-bearing	$	357,539		$	345,588		$	944,241		$	788,906
Interest-bearing		843,750			775,515			1,764,012			1,627,795
Total deposits		1,201,289			1,121,103			2,708,253			2,416,701
Federal Home Loan Bank advances		56,750			48,500
Short-term Federal Home Loan Bank advances								55,000			—
Securities sold under agreements to repurchase		15,148			28,925			20,155			25,495
Long-term Federal Home Loan Bank advances								6,723			75,000
Subordinated debentures		29,427			29,427			103,778			103,735
Swap liabilities								18,448			11,072
Securities purchased payable								2,611			3,524
Tax refunds in process								2,709			549
Accrued expenses and other liabilities		11,493			11,692			21,440			21,617
Total liabilities		1,314,107			1,239,647			2,939,117			2,657,693
SHAREHOLDERS’ EQUITY
Preferred shares, no par value, 200,000 shares authorized, Series B Preferred shares, $1,000 liquidation preference, 18,975 shares issued at September 30, 2017 and 20,481 shares issued at December 31, 2016, net of issuance costs		17,557			18,950
Common shares, no par value, 20,000,000 shares authorized, 10,918,899 shares issued at September 30, 2017 and 9,091,473 shares issued at December 31, 2016		153,562			118,975
Common shares, no par value, 40,000,000 shares authorized, 18,731,167 shares issued at September 30, 2022 and 17,709,584 shares issued at December 31, 2021, including Treasury shares								299,515			277,741
Retained earnings		28,494			19,263			146,546			125,558
Treasury shares, 747,964 common shares at cost		(17,235	)		(17,235	)
Accumulated other comprehensive loss		(397	)		(2,337	)
Treasury shares, 3,495,622 common shares at September 30, 2022 and 2,755,384 common shares at December 31, 2021, at cost								(73,641	)		(56,907	)
Accumulated other comprehensive income (loss)								(69,818	)		8,820
Total shareholders’ equity		181,981			137,616			302,602			355,212
Total liabilities and shareholders’ equity	$	1,496,088		$	1,377,263		$	3,241,719		$	3,012,905

												Three months ended					Nine Months Ended
	Three months ended September 30,					Nine months ended September 30,						September 30,					September 30,
	2017			2016		2017			2016			2022			2021		2022			2021
Interest and dividend income
Loans, including fees	$	13,022		$	11,824	$	37,211		$	35,311		$	27,176		$	22,704	$	70,065		$	68,140
Taxable securities		977			872		2,764			2,494			2,936			1,423		6,431			3,928
Tax-exempt securities		812			664		2,307			1,979			1,998			1,555		5,669			4,599
Federal funds sold and other		25			10		473			376
Total interest income		14,836			13,370		42,755			40,160
Deposits in other banks													423			102		1,098			341
Total interest and dividend income													32,533			25,784		83,263			77,008
Interest expense
Deposits		607			506		1,500			1,480			936			970		2,351			3,366
Federal Home Loan Bank advances		276			111		534			312			181			194		564			968
Subordinated debentures		268			221		766			650			975			182		2,701			553
Other		5			6		16			17
Securities sold under agreements to repurchase and other													2			5		8			19
Total interest expense		1,156			844		2,816			2,459			2,094			1,351		5,624			4,906
Net interest income		13,680			12,526		39,939			37,701			30,439			24,433		77,639			72,102
Provision (credit) for loan losses		—			—		—			(1,300	)
Net interest income after provision (credit) for loan losses		13,680			12,526		39,939			39,001
Provision for loan losses													300			—		1,000			830
Net interest income after provision for loan losses													30,139			24,433		76,639			71,272
Noninterest income
Service charges		1,177			1,194		3,609			3,714			1,885			1,519		5,004			4,092
Net gain (loss) on sale of securities		(9	)		18		(9	)		20
Net gain on sale of securities													4			4		10			1,787
Net gain (loss) on equity securities													(133	)		50		(44	)		191
Net gain on sale of loans		472			541		1,207			1,341			637			1,612		2,146			6,575
ATM fees		567			541		1,643			1,584
ATM/Interchange fees													1,394			1,330		3,990			3,950
Wealth management fees		787			688		2,233			1,989			1,208			1,236		3,713			3,570
Bank owned life insurance		142			149		429			415			255			261		732			752
Tax refund processing fees		—			—		2,750			2,750			—			—		2,375			2,375
Swap fees													—			41		—			135
Other		329			522		842			1,176			484			373		1,086			1,214
Total noninterest income		3,465			3,653		12,704			12,989			5,734			6,426		19,012			24,641
Noninterest expense
Salaries, wages and benefits		7,389			6,375		21,684			19,053
Compensation expense													12,484			11,390		36,654			34,578
Net occupancy expense		690			708		2,002			2,009			1,252			985		3,428			3,216
Equipment expense		350			494		1,097			1,158			637			444		1,694			1,340
Contracted data processing		357			397		1,174			1,147			846			429		1,899			1,362
FDIC assessment		115			166		414			597			170			247		568			829
State franchise tax		255			251		767			709			629			511		1,848			1,607
Professional services		534			431		1,718			1,450			1,335			776		3,593			2,255
Amortization of intangible assets		158			172		483			527			456			223		890			668
ATM expense		233			183		700			379
ATM/Interchange expense													604			594		1,659			1,843
Marketing		240			249		768			810			372			359		1,069			1,000
Software maintenance expense													942			819		2,440			1,872
Other operating expenses		1,846			1,769		5,410			5,314			2,828			2,474		7,450			10,132
Total noninterest expense		12,167			11,195		36,217			33,153			22,555			19,251		63,192			60,702
Income before taxes		4,978			4,984		16,426			18,837			13,318			11,608		32,459			35,211
Income tax expense		1,318			1,304		4,534			5,251			2,206			1,966		5,180			5,647
Net Income		3,660			3,680		11,892			13,586		$	11,112		$	9,642	$	27,279		$	29,564
Preferred stock dividends		308			374		935			1,156
Net income available to common shareholders	$	3,352		$	3,306	$	10,957		$	12,430
Earnings per common share, basic	$	0.33		$	0.41	$	1.12		$	1.57		$	0.72		$	0.64	$	1.82		$	1.90
Earnings per common share, diluted	$	0.29		$	0.34	$	0.97		$	1.24		$	0.72		$	0.64	$	1.82		$	1.90
Weighted average common shares, basic													15,323,294			15,096,162		14,907,539			15,479,424
Weighted average common shares, diluted													15,323,294			15,096,162		14,907,539			15,479,424

													Three Months Ended						Nine Months Ended
	Three months ended September 30,						Nine months ended September 30,						September 30,						September 30,
	2017			2016			2017			2016			2022			2021			2022			2021
Net income	$	3,660		$	3,680		$	11,892		$	13,586		$	11,112		$	9,642		$	27,279		$	29,564
Other comprehensive income (loss):
Unrealized holding gains (losses) on available for sale securities		86			(1,225	)		1,993			2,273
Unrealized holding losses on available-for-sale securities														(29,926	)		(3,107	)		(99,837	)		(6,977	)
Tax effect														6,300			652			21,043			1,465
Reclassification of gains recognized in net income														(4	)		(4	)		(10	)		(2	)
Tax effect		(29	)		417			(678	)		(772	)		—			—			2			—
Pension liability adjustment		426			83			946			249			69			81			208			244
Tax effect		(144	)		(28	)		(321	)		(84	)		(15	)		(17	)		(44	)		(51	)
Total other comprehensive income (loss)		339			(753	)		1,940			1,666
Comprehensive income	$	3,999		$	2,927		$	13,832		$	15,252
Total other comprehensive loss														(23,576	)		(2,395	)		(78,638	)		(5,321	)
Comprehensive income (loss)													$	(12,464	)	$	7,247		$	(51,359	)	$	24,243

~~Condensed~~ Consolidated Statement of Changes in Shareholders’ Equity (Unaudited)

Preferred Shares

Common Shares

Accumulated
Other

Total

Outstanding
Shares

Amount

Outstanding
Shares

Amount

Retained
Earnings

Treasury
Shares

Comprehensive
Loss

Shareholders’
Equity

Balance, December 31, 2016

20,481

$
18,950

8,343,509

$
118,975

$
19,263

$
(17,235
)

$
(2,337
)

$
137,616

Net Income

—

—

—

—

11,892

—

—

11,892

Other comprehensive income

—

—

—

—

—

—

1,940

1,940

Conversion of Series B preferred shares
to common shares

(1,506
)

(1,393
)

192,568

1,393

—

—

—

—

Common stock issuance, net of costs

—

—

1,610,000

32,821

—

—

—

32,821

Stock-based compensation

—

—

25,069

377

—

—

—

377

Common stock dividends
($0.18 per share)

—

—

—

—

(1,726
)

—

—

(1,726
)
Preferred stock dividend

—

—

—

—

(935
)

—

—

(935
)
Retirement of common stock

(211
)

(4
)

(4
)
Balance, September 30, 2017

18,975

$
17,557

10,170,935

$
153,562

$
28,494

$
(17,235
)

$
(397
)

$
181,981

	Common Shares											Accumulated Other			Total
	Outstanding Shares			Amount		Retained Earnings			Treasury Shares			Comprehensive Income (Loss)			Shareholders’ Equity
Balance, June 30, 2022		14,537,433		$	278,240	$	137,592		$	(67,528	)	$	(46,242	)	$	302,062
Net Income		—			—		11,112			—			—			11,112
Other comprehensive loss		—			—		—			—			(23,576	)		(23,576	)
Stock-based compensation		—			153		—			—			—			153
Stock issued for acquisition of Comunibanc Corp.		984,723			21,122											21,122
Common stock dividends ($0.14 per share)		—			—		(2,158	)		—			—			(2,158	)
Purchase of common stock		(286,611	)		—		—			(6,113	)		—			(6,113	)
Balance, September 30, 2022		15,235,545		$	299,515	$	146,546		$	(73,641	)	$	(69,818	)	$	302,602

	Common Shares											Accumulated Other			Total
	Outstanding Shares			Amount		Retained Earnings			Treasury Shares			Comprehensive Income			Shareholders’ Equity
Balance, June 30, 2021		15,434,592		$	277,495	$	109,178		$	(45,953	)	$	11,693		$	352,413
Net Income		—			—		9,642			—			—			9,642
Other comprehensive loss		—			—		—			—			(2,395	)		(2,395	)
Stock-based compensation		—			132		—			—			—			132
Common stock dividends ($0.14 per share)		—			—		(2,140	)		—			—			(2,140	)
Purchase of common stock		(404,620	)		—		—			(9,202	)		—			(9,202	)
Balance, September 30, 2021		15,029,972		$	277,627	$	116,680		$	(55,155	)	$	9,298		$	348,450

	Common Shares											Accumulated Other			Total
	Outstanding Shares			Amount		Retained Earnings			Treasury Shares			Comprehensive Income (Loss)			Shareholders’ Equity
Balance, December 31, 2021		14,954,200		$	277,741	$	125,558		$	(56,907	)	$	8,820		$	355,212
Net Income		—			—		27,279			—			—			27,279
Other comprehensive loss		—			—		—			—			(78,638	)		(78,638	)
Stock-based compensation		36,860			652		—			—			—			652
Stock issued for acquisition of Comunibanc Corp.		984,723			21,122											21,122
Common stock dividends ($0.42 per share)		—			—		(6,291	)		—			—			(6,291	)
Purchase of common stock		(740,238	)		—		—			(16,734	)		—			(16,734	)
Balance, September 30, 2022		15,235,545		$	299,515	$	146,546		$	(73,641	)	$	(69,818	)	$	302,602

	Common Shares											Accumulated Other			Total
	Outstanding Shares			Amount		Retained Earnings			Treasury Shares			Comprehensive Income			Shareholders’ Equity
Balance, December 31, 2020		15,898,032		$	277,039	$	93,048		$	(34,598	)	$	14,619		$	350,108
Net Income		—			—		29,564			—			—			29,564
Other comprehensive loss		—			—		—			—			(5,321	)		(5,321	)
Stock-based compensation		46,864			588		—			—			—			588
Common stock dividends ($0.38 per share)		—			—		(5,932	)		—			—			(5,932	)
Purchase of common stock		(914,924	)		—		—			(20,557	)		—			(20,557	)
Balance, September 30, 2021		15,029,972		$	277,627	$	116,680		$	(55,155	)	$	9,298		$	348,450

	Nine months ended September 30,						Nine Months Ended September 30,
	2017			2016			2022			2021
Net cash from operating activities	$	11,821		$	11,318
Net cash provided by operating activities							$	27,421		$	34,295
Cash flows used for investing activities:
Maturities and calls of securities, available-for-sale		23,529			23,264
Maturities, paydowns and calls of investments in time deposits								245			—
Proceeds from sale of time certificates								742			—
Maturities, paydowns and calls of securities, available-for-sale								36,910			41,492
Purchases of securities, available-for-sale		(57,005	)		(31,130	)		(117,974	)		(184,119	)
Sale of securities available for sale		953			4,379
Purchases of other securities		(192	)		(474	)
Purchase of bank owned life insurance		—			(3,885	)
Net loan originations		(86,678	)		(43,285	)
Loans purchased, installment		—			(1,643	)
Proceeds from sale of securities available-for-sale								57,322			—
Purchase of other securities								(1,606	)		—
Redemption of other securities								1,592			3,526
Purchase of equity securities								(1,000	)		—
Sale of equity securities								—			1,785
Net change in loans								(158,909	)		54,926
Proceeds from sale of other real estate owned properties		72			238			—			118
Proceeds from sale of premises and equipment		139			—			—			13
Acquisition, net of cash acquired								(21,870	)		—
Premises and equipment purchases		(755	)		(1,292	)		(3,208	)		(1,689	)
Net cash used for investing activities		(119,937	)		(53,828	)		(207,756	)		(83,948	)
Cash flows from financing activities:
Repayment of long-term FHLB advances		(2,500	)		—			(89,983	)		(50,000	)
Net change in short-term FHLB advances		10,750			(36,200	)		55,000			—
Increase in deposits		80,186			82,120			20,358			245,368
Decrease in securities sold under repurchase agreements		(13,777	)		(3,327	)		(5,340	)		(5,583	)
Net proceeds from common stock issuance		32,821			—
Cash payment for retirement of common stock		(4	)		—
Purchase of treasury shares								(16,734	)		(20,557	)
Common dividends paid		(1,726	)		(1,259	)		(6,291	)		(5,932	)
Preferred dividends paid		(935	)		(1,156	)
Net cash provided by financing activities		104,815			40,178
Decrease in cash and due from financial institutions		(3,301	)		(2,332	)
Cash and due from financial institutions at beginning of period		36,695			35,561
Cash and due from financial institutions at end of period	$	33,394		$	33,229
Net cash provided (used) by financing activities								(42,990	)		163,296
Increase (decrease) in cash and cash equivalents								(223,325	)		113,643
Cash and cash equivalents at beginning of period								264,239			139,522
Cash and cash equivalents at end of period							$	40,914		$	253,165
Cash paid during the period for:
Interest	$	2,753		$	2,442		$	4,969		$	4,995
Income taxes		4,300			4,700			3,737			4,690
Supplemental cash flow information:
Transfer of loans from portfolio to other real estate owned		78			73			—			26
Transfer of premises to held-for-sale		3			—			—			73
Transfer of loans held for sale to portfolio		419			—
Conversion of preferred shares to common shares		1,393			2,497
Change in fair value of swap asset								(7,376	)		8,906
Change in fair value of swap liability								7,376			(8,906	)
Securities purchased not settled		1,609			—			2,611			3,857
Securities sold not settled		—			2,386
The Company purchased all of the capital stock of Comunibanc Corp. for $46,090 on July 1, 2022. In conjunction with the acquisition, liabilities were assumed as follows:
Fair value of assets acquired							$	340,649
Less: common stock issued								21,122
Cash paid for the capital stock								24,968
Liabilities assumed							$	294,559

Nature of Operations and Principles of Consolidation: Civista Bancshares, Inc. (CBI) is an Ohio corporation and a registered financial holding company. The Consolidated Financial Statements include the accounts of CBI and its wholly-owned subsidiaries: Civista Bank (Civista), First Citizens Insurance Agency, Inc. (FCIA), Water Street Properties, Inc. (Water St.) and ~~FC Refund Solutions,~~CIVB Risk Management, Inc. ~~(FCRS)~~(CRMI). ~~FCRS was formed~~CRMI is a wholly-owned captive insurance company which allows CBI and its subsidiaries to ~~facilitate payment~~insure against certain risks unique to their operations. The operations of ~~individual state and federal income tax refunds.~~CRMI are located in Wilmington, Delaware. First Citizens Capital LLC (FCC) is wholly-owned by Civista and holds inter-company debt. The operations of FCC are located in Wilmington, Delaware. First Citizens Investments, Inc. (FCI) is wholly-owned by Civista and holds and manages its securities portfolio. The operations of FCI are located in Wilmington, Delaware. FCIA was formed to allow the Company to participate in commission revenue generated through its third-party insurance agreement. Water St. was formed to hold properties repossessed by CBI subsidiaries. The above companies together are referred to as the “Company.” Intercompany balances and transactions are eliminated in consolidation. First Citizens Insurance Agency, Inc. was formed to allow the Company to participate in commission revenue generated through its third party insurance agreement. Insurance commission revenue was less than 1.0% of total revenue through September 30, 2017. Water Street Properties was formed to hold properties repossessed by CBI subsidiaries. Revenue from Water St. was less than 1.0% of total revenue through September 30, 2017. Management considers the Company to operate primarily in one reportable segment, banking.

The Consolidated Financial Statements have been prepared by the Company without audit. In the opinion of management, all adjustments (which include only normal recurring adjustments) necessary to present fairly the Company’s financial position as of September 30, ~~2017~~2022 and its results of operations and changes in cash flows for the periods ended September 30, ~~2017~~2022 and ~~2016~~2021 have been made. The accompanying Unaudited Consolidated Financial Statements have been prepared in accordance with instructions of Form 10-Q, and therefore certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States of America have been omitted. The results of operations for the ~~periods~~period ended September 30, ~~2017~~2022 are not necessarily indicative of the operating results for the full year. Reference is made to the accounting policies of the Company described in the notes to the audited financial statements contained in the Company’s ~~2016~~2021 annual report. The Company has consistently followed these policies in preparing this Form 10-Q.

~~The Company~~Civista provides financial services through its offices in the Ohio counties of Erie, Crawford, Champaign, Franklin, Logan, Madison, Summit, Huron, Ottawa, Richland, Montgomery, Henry, Wood and ~~Cuyahoga.~~Cuyahoga, in the Indiana counties of Dearborn and Ripley and in the Kentucky county of Kenton. Its primary deposit products are checking, savings, and term certificate accounts, and its primary lending products are residential mortgage, commercial, and installment loans. Substantially all loans are secured by specific items of collateral including business assets, consumer assets and commercial and residential real estate. Commercial loans are expected to be repaid from cash flow from operations of businesses. The bank has two concentrations, one is to Lessors of Non-Residential Buildings and Dwellings totaling $284,218, or 24.8% of total loans, as of September 30, 2017 and the other is to Lessors of Residential Buildings and Dwellings totaling $155,616, or 13.6% of total loans, as of September 30, 2017. These segments of the portfolio are stable and have been conservatively underwritten, monitored and managed by experienced commercial bankers. However, the customers’ ability to repay their loans is dependent on the real estate market and general economic conditions in the area. Other financialFinancial instruments that potentially represent concentrations of credit risk include ~~Federal Funds sold and~~ deposit accounts in other financial institutions that are in excess of federally insured limits.

Allowance for Loan Losses:The allowance for loan losses is regularly reviewed by management to determine that the amount is considered adequate to absorb probable losses in the loan portfolio. If not, an additional provision is made to increase the allowance. This evaluation includes specific loss estimates on certain individually reviewed impaired loans, the pooling of commercial credits risk graded as special mention and substandard that are not individually analyzed, and general loss estimates that are based upon the size, quality, and concentration characteristics of the various loan portfolios, adverse situations that may affect a borrower’s ability to repay, and current economic and industry conditions, among other items.

Those judgments and assumptions that are most critical to the application of this accounting policy are assessing the initial and on-going credit-worthiness of the borrower, the amount and timing of future cash flows of the borrower that are available for repayment of the loan, the sufficiency of underlying collateral, the enforceability of third-party guarantees, the frequency and subjectivity of loan reviews and risk ratings, emerging or changing trends that might not be fully captured in the historical loss experience, and charges against the allowance for actual losses that are greater than previously estimated. These judgments and assumptions are dependent upon or can be influenced by a variety of factors, including the breadth and depth of experience of lending officers, credit administration and the corporate loan review staff that periodically review the status of the loan, changing economic and industry conditions, changes in the financial condition of the borrower and changes in the value and availability of the underlying collateral and guarantees.

~~Pension Benefits:~~ Pension costs and liabilities are dependent on assumptions used in calculating such amounts. These assumptions include discount rates, benefits earned, interest costs, expected return on plan assets, mortality rates, and other factors. In accordance with GAAP, actual results that differ from the assumptions are accumulated and amortized over future periods and, therefore, generally affect recognized expense

and the recorded obligation of future periods. While management believes that the assumptions used are appropriate, differences in actual experience or changes in assumptions may affect the Company’s pension obligations and future expense.

Use of Estimates: To prepare financial statements in conformity with accounting principles generally accepted in the United States of America, management makes estimates and assumptions based on available information. These estimates and assumptions affect the amounts reported in financial statements and the disclosures provided, and future results could differ. The allowance for loan losses, consideration of impairment of goodwill, fair values of financial instruments, deferred taxes, swap assets/liabilities and pension obligations are particularly subject to change.

~~Income Taxes~~ : Income tax expense is based on the effective tax rate expected to be applicable for the entire year. Income tax expense is the total of the current year income tax due or refundable and the change in deferred tax assets and liabilities. Deferred tax assets and liabilities are the expected future tax amounts for the temporary differences between carrying amounts and tax basis of assets and liabilities, computed using enacted tax rates. A valuation allowance, if needed, reduces deferred tax assets to the amount expected to be realized.

~~Business Combinations:~~ At the date of acquisition the Company records the assets and liabilities of the acquired companies on the Consolidated Balance Sheet at their fair value. The results of operations for acquired companies are included in the Company’s Consolidated Statements of Operations beginning at the acquisition date. Expenses arising from acquisition activities are recorded in the Consolidated Statements of Operations during the period incurred.

~~Reclassifications:~~ ~~Some items in the prior year financial statements were reclassified to conform to the current presentation. Such reclassifications had no effect on net income or shareholders’ equity.~~

~~Derivative Instruments and Hedging Activities~~ : The Company enters into interest rate swap agreements to facilitate the risk management strategies of a small number of commercial banking customers. All derivatives are accounted for in accordance with ASC-815, ~~Derivatives and Hedging~~ . The Company mitigates the risk of entering into these agreements by entering into equal and offsetting swap agreements with highly rated third party financial institutions. The swap agreements are free-standing derivatives and are recorded at fair value in the Company’s consolidated balance sheets. The Company is party to master netting arrangements with its financial institution counterparties; however, the Company does not offset assets and liabilities under these arrangements for financial statement presentation purposes because the Company does not currently intend to execute a setoff with its’ counterparties. The master netting arrangements provide for a single net settlement of all swap agreements, as well as collateral, in the event of default on, or termination of, any one contract. Collateral, usually in the form of marketable securities, is posted by the counterparty with net liability positions in accordance with contract thresholds.

~~In May 2014, the FASB issued ASU 2014-09,~~ ~~Revenue from Contracts with Customers~~ (a new revenue recognition standard). The Update’s core principle is that a company will recognize revenue to depict the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In addition, this Update specifies the accounting for certain costs to obtain or fulfill a contract with a customer and expands disclosure requirements for revenue recognition. This Update is effective for annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period. However, in August 2015, the FASB issued ASU 2015-14, ~~Revenue from Contracts with Customers~~ (Topic 606) to defer the effective date of ASU 2014-09 for all entities by one year. Public business entities, certain not-for-profit entities, and certain employee benefit plans should apply the guidance in ASU 2014-09 to annual reporting periods beginning after December 15, 2017, including interim reporting periods within that reporting period. All other entities should apply the guidance in ASU 2014-09 to annual reporting periods beginning after December 15, 2018, and interim reporting periods within annual reporting periods beginning after December 15, 2019. Because the guidance does not apply to revenue associated with financial instruments, including loans and securities, we do not expect the new standard, or any of the amendments, to result in a material change from our current accounting for revenue because the majority of the Company’s financial instruments are not within the scope of Topic 606. However, we do expect that the standard will result in new disclosure requirements, which are currently being evaluated.

~~In January 2016, the FASB issued ASU 2016-01,~~ ~~Financial Instruments – Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities~~ . This Update applies to all entities that hold financial assets or owe financial liabilities and is intended to provide more useful information on the recognition, measurement, presentation, and disclosure of financial instruments. Among other things, this Update (a) requires equity investments (except those accounted for under the equity method of accounting or those that result in consolidation of the investee) to be measured at fair value with changes in fair value recognized in net income; (b) simplifies the impairment assessment of equity investments without readily determinable fair values by requiring a qualitative assessment to identify impairment; (c) eliminates the requirement to disclose the fair value of financial instruments measured at amortized cost for entities that are not public business entities; (d) eliminates the requirement for public business entities to disclose the method(s) and significant assumptions used to estimate the fair value that is required to be disclosed for financial instruments measured at amortized cost on the balance sheet; (e) requires public business entities to use the exit price notion when measuring the fair value of financial instruments for disclosure purposes; (f) requires an entity to present separately in other comprehensive income the portion of the total change in the fair value of a liability resulting from a change in the instrument-specific credit risk

when the entity has elected to measure the liability at fair value in accordance with the fair value option for financial instruments; (g) requires separate presentation of financial assets and financial liabilities by measurement category and form of financial asset (that is, securities or loans and receivables) on the balance sheet or the accompanying notes to the financial statements; and (h) clarifies that an entity should evaluate the need for a valuation allowance on a deferred tax asset related to available-for-sale securities in combination with the entity’s other deferred tax assets. For public business entities, the amendments in this Update are effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. For all other entities including not-for-profit entities and employee benefit plans within the scope of Topics 960 through 965 on plan accounting, the amendments in this Update are effective for fiscal years beginning after December 15, 2018, and interim periods within fiscal years beginning after December 15, 2019. All entities that are not public business entities may adopt the amendments in this Update earlier as of the fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The Company is currently evaluating the impact the adoption of the standard will have on the Company’s financial position or results of operations.

~~In February 2016, the FASB issued ASU 2016-02,~~ ~~Leases (Topic 842)~~ . The standard in this Update requires lessees to recognize the assets and liabilities that arise from leases on the balance sheet. A lessee should recognize in the statement of financial position a liability to make lease payments (the lease liability) and a right-of-use asset representing its right to use the underlying asset for the lease term. A short-term lease is defined as one in which: (a) the lease term is 12 months or less, and (b) there is not an option to purchase the underlying asset that the lessee is reasonably certain to exercise. For short-term leases, lessees may elect to recognize lease payments over the lease term on a straight-line basis. For public business entities, the amendments in this Update are effective for fiscal years beginning after December 15, 2018, and interim periods within those years. For all other entities, the amendments in this Update are effective for fiscal years beginning after December 15, 2019, and for interim periods within fiscal years beginning after December 15, 2020. The amendments should be applied at the beginning of the earliest period presented using a modified retrospective approach with earlier application permitted as of the beginning of an interim or annual reporting period. The Company is currently assessing the practical expedients it may elect at adoption, but does not anticipate the amendments will have a significant impact to the financial statements. Based on the Company’s preliminary analysis of its current portfolio, the impact to the Company’s balance sheet is estimated to result in less than a 1% increase in assets and liabilities. The Company also anticipates additional disclosures to be provided at adoption.

In June 2016, the ~~FASB~~Financial Accounting Standards Board (the “FASB”) issued ~~ASU~~Accounting Standards Update (“ASU”) 2016-13, Financial Instruments-Credit Losses: Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”), which changes the impairment model for most financial assets. This ASU is intended to improve financial reporting by requiring timelier recording of credit losses on loans and other financial instruments held by financial institutions and other organizations. The underlying premise of ASU 2016-13 is that financial assets measured at amortized cost should be presented at the net amount expected to be collected, through an allowance for credit losses that is deducted from the amortized cost basis. The allowance for credit losses should reflect management’s current estimate of credit losses that are expected to occur over the remaining life of a financial asset. The income statement will be effected for the measurement of credit losses for newly recognized financial assets, as well as the expected increases or decreases of expected credit losses that have taken place during the period. ~~ASU 2016-13 is effective for annual and interim periods beginning after December 15, 2019, and early adoption is permitted for annual and interim periods beginning after December 15, 2018. We expect~~With certain exceptions, transition to ~~recognize~~the new requirements will be through a ~~one-time~~ cumulative effect adjustment to ~~the allowance for loan losses~~opening retained earnings as of the beginning of the first reporting period in which the ~~new standard~~guidance is adopted. ASU 2016-13 was to be effective ~~but cannot yet determine~~for annual and interim periods beginning after December 15, 2019, with early adoption permitted for annual and interim periods beginning after December 15, 2018. In November 2019, however, the ~~magnitude~~FASB issued ASU 2019-10, Financial Instruments ‒ Credit Losses (Topic 326), Derivatives and Hedging (Topic 815), and Leases (Topic 842). This Update deferred the effective date of ~~any~~ASU 2016-13 for U.S. Securities and Exchange Commission (“SEC”) filers that were eligible to be smaller reporting companies as of November 15, 2019, such ~~one-time adjustment or~~as the ~~overall~~Company, to fiscal years beginning after December 15, 2022, and interim periods within those fiscal years. Management is in the process of evaluating the impact adoption of ~~the new guidance~~ASU 2016-13 will have on the Company’s ~~consolidated financial statements.~~Consolidated Financial Statements. This process has engaged multiple areas of the Company in evaluating loss estimation methods and application of these methods to specific segments of the loan portfolio. Management has been actively monitoring FASB developments and evaluating the use of different methods allowed. Due to continuing development of our methodology, additional time is required to quantify the effect this ASU will have on the Company’s Consolidated Financial Statements. Management has run parallel calculations and is finalizing the methodology for adoption in time for the effective date.

In January 2017, the FASB issued ASU 2017-04, Intangibles – Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment. To simplify the subsequent measurement of goodwill, the FASB eliminated Step 2 from the goodwill impairment test. In computing the implied fair value of goodwill under Step 2, an entity had to perform procedures to determine the fair value at the impairment testing date of its assets and liabilities (including unrecognized assets and liabilities) following the procedure that would be required in determining the fair value of assets acquired and liabilities assumed in a business combination. Instead, under the amendments in this Update, an entity should perform its annual, or interim, goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An entity should recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. A public business entity that is ~~a U.S. Securities and Exchange Commission (“SEC”)~~an SEC filer, ~~should~~such as the Company, was to adopt the amendments in this Update for its annual or any interim goodwill impairment tests in fiscal years beginning after December 15, 2019. ~~A public business entity~~In November 2019, however, the FASB issued ASU 2019-10, Financial Instruments ‒ Credit Losses (Topic 326), Derivatives and Hedging (Topic 815), and Leases (Topic 842), which deferred the effective date for ASC 350, Intangibles – Goodwill and Other, for SEC filers that ~~is not an SEC filer should adopt~~were eligible to be smaller reporting companies as of November 15, 2019, such as the ~~amendments in this Update for its annual or any interim goodwill impairment tests in~~Company, to fiscal years beginning after December 15, ~~2020. All other entities, including not-for-profit entities, that are adopting the amendments in this Update should do so for their annual or any~~2022, and interim ~~goodwill impairment tests in~~periods within those fiscal ~~years beginning after December 15, 2021.~~years. The Company is currently evaluating the impact the adoption of the standard will have on the Company’s financial position or results of operations.

~~In March 2017, the FASB issued ASU 2017-07,~~ ~~Compensation—Retirement Benefits (Topic 715)~~ . The amendments in this Update require that an employer report the service cost component in the same line item or items as other compensation costs arising from services rendered by the pertinent employees during the period. The other components of net benefit cost as defined in paragraphs 715-30-35-4 and 715-60-35-9 are required to be presented in the income statement separately from the service cost component and outside a subtotal of income from operations, if one is presented. If a separate line item or items are used to present the other components of net benefit cost, that line item or items must be appropriately described. If a separate line item or items are not used, the line item or items used in the income statement to present the other

In April 2019, the FASB issued ASU 2019-04, Codification Improvements to Topic 326, Financial Instruments – Credit Losses, and Topic 825, Financial Instruments, which affects a variety of ~~net benefit cost must be disclosed. The guidance is~~topics in the Codification and applies to all reporting entities within the scope of the affected accounting guidance. Topic 326, Financial Instruments – Credit Losses amendments are effective for ~~public business entities~~SEC registrants for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years. The amendments to Topic 825 were to be effective for interim and annual reporting periods beginning after December 15, ~~2017,~~2019. In November 2019, however, the FASB issued ASU 2019-10, Financial Instruments ‒ Credit Losses (Topic 326), Derivatives and ~~interim periods within~~Hedging (Topic 815), and Leases (Topic 842). This Update defers the effective date of ASU 2016-13 for SEC filers that were eligible to be smaller reporting ~~period. For all other entities (including all nonprofit organizations “NPOs”), it is effective for annual periods~~companies as of November 15, 2019, such as the Company, to fiscal years beginning after December 15, ~~2018, and~~2022, including interim periods within ~~annual periods~~those fiscal years. This Update is not expected to have a material impact on the Company’s financial statements.

In May 2019, the FASB issued ASU 2019-05, Financial Instruments – Credit Losses, Topic 326, which allows entities to irrevocably elect the fair value option for certain financial assets previously measured at amortized cost upon adoption of the new credit losses standard. To be eligible for the transition election, the existing financial asset must otherwise be both within the scope of the new credit losses standard and eligible for applying the fair value option in ASC 825-10.3. The election must be applied on an instrument-by-instrument basis and is not available for either available-for-sale or held-to-maturity debt securities. For entities that elect the fair value option, the difference between the carrying amount and the fair value of the financial asset would be recognized through a cumulative-effect adjustment to opening retained earnings as of the date an entity adopted ASU 2016-13. Changes in fair value of that financial asset would subsequently be reported in current earnings. For entities that have not yet adopted ASU 2016-13, the effective dates and transition requirements are the same as those in ASU 2016-13. For entities that have adopted ASU 2016-13, ASU 2019-05 is effective for fiscal years beginning after December 15, ~~2019. This guidance~~2019, including interim periods within those fiscal years. Early adoption is ~~required~~permitted once ASU 2016-13 has been adopted. In November 2019, the FASB issued ASU 2019-10, Financial Instruments ‒ Credit Losses (Topic 326), Derivatives and Hedging (Topic 815), and Leases (Topic 842). The Update defers the effective date of ASU 2016-13 for SEC filers that were eligible to be ~~applied on a retrospective basis for~~smaller reporting companies as of November 15, 2019, such as the ~~presentation of the service cost component and the other components of net benefit cost and on a prospective basis for the capitalization of only the service cost component of net benefit cost.~~ Company, to fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. The Company is currently evaluating the impact the adoption of the standard will have on the Company’s financial ~~position or results of operations.~~statements.

In ~~March 2017,~~November 2019, the FASB issued ASU ~~2017-08,~~ ~~Receivables~~2019-11, Codification Improvements to Topic 326, Financial Instruments – ~~Nonrefundable Fees and Other Costs (Subtopic 310-20).~~ ~~The amendments~~Credit Losses, to clarify its new credit impairment guidance in ~~this~~ASC 326, based on implementation issues raised by stakeholders. This Update ~~shorten the amortization period for certain callable debt securities held at a premium. Specifically, the amendments require the premium~~clarified, among other things, that expected recoveries are to be ~~amortized~~included in the allowance for credit losses for these financial assets; an accounting policy election can be made to adjust the effective interest rate for existing troubled debt restructurings based on the prepayment assumptions instead of the prepayment assumptions applicable immediately prior to the ~~earliest call date.~~restructuring event; and extends the practical expedient to exclude accrued interest receivable from all additional relevant disclosures involving amortized cost basis. The ~~amendments do not require an accounting change for securities held at a discount; the discount continues to be amortized to maturity. For public business entities, the amendments~~effective dates in this Update are ~~effective~~the same as those applicable for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. For all other entities, the amendments are effective for fiscal years beginning after December 15, 2019, and interim periods within fiscal years beginning after December 15, 2020. Early adoption is permitted, including adoption in an interim period. If an entity early adopts the amendments in an interim period, any adjustments should be reflected as of the beginning of the fiscal year that includes that interim period. An entity should apply the amendments in this Update on a modified retrospective basis through a cumulative-effect adjustment directly to retained earnings as of the beginning of the period of adoption. Additionally, in the period of adoption, an entity should provide disclosures about a change in accounting principle. ASU 2019-10.The Company is currently evaluating the impact the adoption of the standard will have on the Company’s financial position or results of operations.

In ~~May 2017,~~March 2020, the FASB issued ASU ~~2017-09,~~ ~~Compensation – Stock Compensation (Topic 718)~~2020-03, ~~which affects any entity~~Codification Improvements to Financial Instruments. This ASU was issued to improve and clarify various financial instruments topics, including the current expected credit losses (CECL) standard issued in 2016. The ASU includes seven issues that ~~changes~~describe the ~~terms or conditions~~areas of improvement and the related amendments to GAAP; they are intended to make the standards easier to understand and apply and to eliminate inconsistencies, and they are narrow in scope and are not expected to significantly change practice for most entities. Among its provisions, the ASU clarifies that all entities, other than public business entities that elected the fair value option, are required to provide certain fair value disclosures under ASC 825, Financial Instruments, in both interim and annual financial statements. It also clarifies that the contractual term of a ~~share-based payment award.~~net investment in a lease under Topic 842 should be the contractual term used to measure expected credit losses under Topic 326. Amendments related to ASU 2019-04 are effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption is not permitted before an entity’s adoption of ASU 2016-01. Amendments related to ASU 2016-13 for entities that have not yet adopted that guidance, such as the Company, are effective upon adoption of the amendments in ASU 2016-13. Early adoption is not permitted before an entity’s adoption of ASU 2016-13. Other amendments are effective upon issuance of this ASU. This Update ~~amends~~is not expected to have a significant impact on the ~~definition of modification by qualifying that modification accounting does not apply to changes to outstanding share-based payment awards that do not affect~~Company’s financial statements.

In March 2020, the ~~total fair value, vesting requirements, or equity/liability classification~~FASB issued ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the ~~awards.~~Effects of Reference Rate Reform on Financial Reporting. The Update is designed to provide relief from the accounting analysis and impacts that may otherwise be required for modifications to agreements necessitated by reference rate reform. The Update also provides optional expedients to enable companies to continue to apply hedge accounting to certain hedging relationships impacted by reference rate reform. The amendments in this Update are effective for all entities ~~for annual periods, and interim periods within those annual periods, beginning after~~as of March 12, 2020 through December 15, 2017. Early adoption is permitted, including adoption in any interim period, for (1) public business entities for reporting periods for which financial statements have not yet been issued and (2) all other entities for reporting periods for which financial statements have not yet been made available for issuance. The amendments in this Update should be applied prospectively to an award modified on or after the adoption date.31, 2022. The Company is ~~currently~~working through this transition via a multi-disciplinary project team. We are still evaluating the impact the ~~adoption of the standard~~change from LIBOR to a benchmark like SOFR or Prime Rate will have on ~~the Company’s~~our financial ~~position or~~condition, results of ~~operations.~~operations or cash flows.

~~In July 2017, the FASB issued ASU 2017-11,~~ ~~Earnings Per Share (Topic 260), Distinguishing Liabilities from Equity (Topic 480), and Derivative and Hedging (Topic 815)~~. The amendments in Part I of this Update change the classification analysis of certain equity-linked financial instruments (or embedded features) with down-round features. When determining whether certain financial instruments should be classified as liabilities or equity instruments, a down-round feature no longer precludes equity classification when assessing whether the instrument is indexed to an entity’s own stock. The amendments also clarify existing disclosure requirements for equity-classified instruments. As a result, a freestanding equity-linked financial instrument (or embedded conversion option) no longer would be accounted for as a derivative liability at fair value as a result of the existence of a down-round feature. For freestanding equity classified financial instruments, the amendments require entities that present earnings per share (“EPS”) in accordance with Topic 260 to recognize the effect of the down-round feature when it is triggered. That effect is treated as a dividend and as a reduction of income available to common shareholders in basic EPS. Convertible instruments with embedded conversion options that have down- round features are now subject to the specialized guidance for contingent beneficial conversion features (in Subtopic 470-20, ~~Debt—Debt with Conversion and Other Options~~ ), including related EPS guidance (in Topic 260). The amendments in Part II of this Update recharacterize the indefinite deferral of certain provisions of Topic 480 that now are presented as pending content in the Accounting Standards Codification, to a scope exception. Those amendments do not have an accounting effect. For public business entities, the amendments in Part I of this Update are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. For all other entities, the amendments in Part I of this Update are effective for fiscal years beginning after December 15, 2019, and interim periods within fiscal years beginning after December 15, 2020. Early adoption is permitted for all entities, including adoption in an interim period. If an entity early adopts the amendments in an interim period, any adjustments should be reflected as of the beginning of the fiscal year that includes that interim period. The amendments in Part I of this Update should be applied either retrospectively to outstanding financial instruments with a down-round feature by means of a cumulative-effect adjustment to the statement of financial position as of the beginning of the first fiscal year and interim period(s) in which the pending content that links to this paragraph is effective or retrospectively to outstanding financial instruments with a down-round feature for each prior reporting period presented in accordance with the guidance on accounting changes in paragraphs 250-10-45-5 through 45-10. The amendments in Part II of this Update do not require any transition guidance because those amendments do not have an accounting effect. The Company is currently evaluating the impact the adoption of the standard will have on the Company’s financial position or results of operations.

~~In August 2017, the FASB issued ASU 2017-12,~~ ~~Derivatives and Hedging (Topic 850)~~, the objective of which is to improve the financial reporting of hedging relationships to better portray the economic results of an entity’s risk management activities in its financial statements. In addition, the amendments in this Update make certain targeted improvements to simplify the application and disclosure of the hedge accounting guidance in current general accepted accounting principles. For public business entities, the amendments in this Update are effective for fiscal

~~years beginning after December 15, 2018, and interim periods within those fiscal years. For all other entities,~~

Other recent ASU’s issued by the ~~amendments~~FASB did not, or are effective for fiscal years beginning after December 15, 2019, and interim periods beginning after December 15, 2020. Early application is permitted in any period after issuance. For cash flow and net investment hedges existing at the date of adoption, an entity should applynot believed by management to have, a cumulative-effect adjustment related to eliminating the separate measurement of ineffectiveness to accumulated other comprehensive income with a corresponding adjustment to the opening balance of retained earnings as of the beginning of the fiscal year that an entity adopts the amendments in this Update. The amended presentation and disclosure guidance is required only prospectively. The Company is currently evaluating the impact the adoption of the standard will havematerial effect on the Company’s ~~financial position~~present or ~~results of operations.~~future Consolidated Financial Statements.

~~In September 2017, the FASB issued 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.~~ The SEC Observer said that the SEC staff would not object if entities that are considered public business entities only because their financial statements or financial information is required to be included in another entity’s SEC filing use the effective dates for private companies when they adopt ASC 606, ~~Revenue from Contracts with Customers, and ASC 842,~~ ~~Leases~~. The Update also supersedes certain SEC paragraphs in the Codification related to previous SEC staff announcements and moves other paragraphs, upon adoption of ASC 606 or ASC 842. This Update is not expected to have a significant impact on the Company’s financial statements.

The amortized cost and fair market value of ~~available for sale~~available-for-sale securities and the related gross unrealized gains and losses recognized ~~in accumulated other comprehensive loss~~ were as follows:

The amortized cost and fair value of securities at September 30, ~~2017,~~2022, by contractual maturity, is shown below. Actual maturities may differ from contractual maturities because issuers may have the right to call or prepay obligations. Securities not due at a single maturity date, primarily mortgage-backed securities, ~~and equity securities~~ are shown separately.

Available for sale	Amortized Cost		Fair Value		Amortized Cost		Fair Value
Due in one year or less	$	5,099	$	5,108	$	1,500	$	1,490
Due after one year through five years		30,106		30,180		47,323		43,934
Due after five years through ten years		33,441		35,104		72,996		66,744
Due after ten years		71,769		74,286		288,605		246,184
Mortgage-backed securities		83,486		83,923		272,950		243,694
Equity securities		481		818
Total securities available for sale	$	224,382	$	229,419
Total securities available-for-sale					$	683,374	$	602,046

Proceeds from sales of securities available-for-sale, gross realized gains and gross realized losses were as follows:

Securities were pledged to secure public deposits, other deposits and liabilities as required by law. The carrying value of pledged securities was approximately $176,667 and $168,345 as of September 30, 2022 and December 31, 2021, respectively.

~~Proceeds from sales~~The following tables show gross unrealized losses and fair value, aggregated by investment category, and length of time that individual securities ~~gross realized gains and gross realized losses were as follows:~~

~~Securities were pledged to secure public deposits, other deposits and liabilities as required by law. The carrying value of pledged securities was approximately $130,367 and $139,179 as of~~have been in a continuous unrealized loss position at September 30, ~~2017~~2022 and December 31, ~~2016, respectively.~~

~~Securities with unrealized losses at September 30, 2017 and December 31, 2016 not recognized in income are as follows:~~2021:

September 30, 2017	12 Months or less					More than 12 months					Total
September 30, 2022																12 Months or less					More than 12 months					Total
Description of Securities	Fair Value		Unrealized Loss			Fair Value		Unrealized Loss			Fair Value		Unrealized Loss			Fair Value		Unrealized Loss			Fair Value		Unrealized Loss			Fair Value		Unrealized Loss
U.S. Treasury securities and obligations of U.S. government agencies	$	13,574	$	(48	)	$	3,761	$	(39	)	$	17,335	$	(87	)	$	20,930	$	(880	)	$	39,122	$	(4,797	)	$	60,052	$	(5,677	)
Obligations of states and political subdivisions		4,960		(51	)		5,462		(174	)		10,422		(225	)		266,106		(43,065	)		8,192		(3,516	)		274,298		(46,581	)
Mortgage-backed securities in gov’t sponsored entities		21,758		(108	)		15,062		(248	)		36,820		(356	)		159,647		(12,221	)		79,790		(17,051	)		239,437		(29,272	)
Total temporarily impaired	$	40,292	$	(207	)	$	24,285	$	(461	)	$	64,577	$	(668	)	$	446,683	$	(56,166	)	$	127,104	$	(25,364	)	$	573,787	$	(81,530	)

December 31, 2016	12 Months or less					More than 12 months					Total
December 31, 2021																12 Months or less					More than 12 months					Total
Description of Securities	Fair Value		Unrealized Loss			Fair Value		Unrealized Loss			Fair Value		Unrealized Loss			Fair Value		Unrealized Loss			Fair Value		Unrealized Loss			Fair Value		Unrealized Loss
U.S. Treasury securities and obligations of U.S. government agencies	$	13,271	$	(61	)	$	893	$	(16	)	$	14,164	$	(77	)	$	41,432	$	(473	)	$	2,014	$	(57	)	$	43,446	$	(530	)
Obligations of states and political subdivisions		17,167		(558	)		519		(16	)		17,686		(574	)		25,797		(107	)		—		—			25,797		(107	)
Mortgage-backed securities in gov’t sponsored entities		35,453		(566	)		2,849		(31	)		38,302		(597	)		141,327		(1,343	)		3,123		(107	)		144,450		(1,450	)
Total temporarily impaired	$	65,891	$	(1,185	)	$	4,261	$	(63	)	$	70,152	$	(1,248	)	$	208,556	$	(1,923	)	$	5,137	$	(164	)	$	213,693	$	(2,087	)

At September 30, ~~2017,~~2022, there were ~~fifty-eight~~a total of 532 securities in the portfolio with unrealized losses mainly due to higher current market rates when compared to the time of purchase. Unrealized losses on securities have not been recognized into income because the issuers’ securities are of high credit quality, management has the intent and ability to hold these securities for the foreseeable future, and the decline in fair value is largely due to currently higher market ~~yields increasing.~~rates when compared to the time of purchase. The fair value is expected to recover as the securities approach their maturity date or reset date. The Company does not intend to sell until recovery and does not believe selling will be required before recovery.

~~Included~~The following table presents the net gains and losses on equity investments recognized in ~~total loans above are deferred loan (fees) costs~~earnings for the three- and nine-months ended September 30, 2022 and 2021, and the portion of ~~$(80)~~unrealized gains and losses for the period that relates to equity investments held at September 30, ~~2017~~2022 and ~~$94 at December 31, 2016.~~2021:

Included in Commercial & Agriculture loans above are $819 and $43,209 of Paycheck Protection Program (“PPP”) loans as of September 30, 2022 and December 31, 2021, respectively.

Included in total loans above are net deferred loan fees of $1,741 and $2,924 at September 30, 2022 and December 31, 2021, respectively, which included net deferred loan fees from PPP loans of $38 and $1,762 as of September 30, 2022 and December 31, 2021, respectively.

In total, we processed over 3,600 PPP loans totaling $399.4 million during 2020 and 2021. Of the total PPP loans we originated, $398.4 million had been forgiven or paid off as of September 30, 2022. We recognized $1.7 million of PPP fees in income during the first nine months of 2022, and $38 thousand of unearned PPP fees remained at September 30, 2022.

Management has an established methodology ~~to determine~~for determining the adequacy of the allowance for loan losses that assesses the risks and losses inherent in the loan portfolio. For purposes of determining the allowance for loan ~~and lease~~ losses, the Company has segmented certain loans in the portfolio by product type. Loss migration rates for each risk category are calculated and used as the basis for calculating loan loss allowance allocations. Loss migration rates are calculated over a three-year period for all portfolio segments. Management also considers certain economic factors for trends that management uses to account for the qualitative and environmental changes in risk, which affects the level of the reserve.

The total allowance reflects management’s estimate of loan losses inherent in the loan portfolio at the balance sheet date. The Company considers the allowance for loan losses of ~~$12,946~~$27,773 adequate to cover loan losses inherent in the loan portfolio, at September 30, ~~2017.~~2022. The following tables present, by portfolio segment, the changes in the allowance for loan losses for the ~~three~~three- and ~~nine~~nine-months ended September 30, 2022 and 2021.

~~Allowance~~2022, the Company provided $300 to the allowance for loan ~~losses:~~

~~For~~losses, as compared to a provision of $0 for the ~~nine~~three months ended September 30, ~~2017~~2021. The increase in the provision in the third quarter of 2022, as compared to the third quarter of 2021, reflects the Company’s strong loan growth during the quarter. Our credit quality metrics remain stable despite the ongoing headwinds of the challenging international, national, regional and local economic conditions. While the direct impact of COVID-19 wains, we remain cautious due to increasing inflationary pressures. Criticized loans were reduced in the third quarter, primarily loans to borrowers in the hotel industry, due to improved occupancy. Economic impacts related to the COVID-19 pandemic have improved somewhat, but continued concerns linger due to the disruption of supply chains, workforce shortages, rising inflationary pressures and the prospects of recession.

~~For~~During the ~~nine~~three months ended September 30, ~~2017,~~2022, the allowance for Commercial & Agriculture loans ~~was reduced by~~decreased due to a decrease in general reserves required for this type as a result of ~~lower loss rates.~~a decrease in Commercial & Agriculture loan balances during the quarter. The result was represented as a decrease in the provision. The allowance for Commercial Real Estate – Owner Occupied loans ~~was reduced by a decrease~~increased due to an increase in general reserves ~~and charge-offs.~~required for this type as a result of increased loan balances. The result was represented as an increase in the provision. The allowance for Commercial Real Estate – Non-Owner Occupied loans decreased due to a decrease in risk rated loans and lower loss rates, offset by an increase in general reserves required as a result of an increase in loan balances. This was represented as a decrease in the provision. The allowance for Residential Real Estate loans increased due to an increase in general reserves required for this type as a result of ~~higher~~increased loan balances. The ~~allowance for Residential Real Estate loans~~result was ~~reduced by a decrease in general reserves required for this type as a result of a decrease in loss rates,~~ represented by ~~a decrease~~an increase in the provision. The allowance for Real Estate Construction loans increased due to ~~higher outstanding loan balances for this type of loan. The allowance for Farm Real Estate loans was reduced by a decrease~~an increase in ~~general reserves required for this type as a result of lower outstanding~~ loan balances. ~~The result~~This was represented as ~~a decrease~~an increase in the provision. ~~The allowance for Consumer and Other loans increased due to an increase in general reserves required for this type as a result of higher loss rates.~~ Management feels that the unallocated amount is appropriate and within the relevant range for the allowance that is reflective of the risk in the ~~portfolio.~~portfolio at September 30, 2022.

For the ~~nine~~three months ended September 30, ~~2016~~2021, the Company provided $0 to the allowance for loan losses. The lack of a provision for the third quarter of 2021 was due to the stability of our credit quality metrics coupled with the stabilization and, in some cases, improvement of international, national, regional and local economic conditions that were adversely impacted by the 2020 economic shutdown and restrictions in response to the ongoing COVID-19 pandemic.

~~For~~During the ~~nine~~three months ended September 30, ~~2016,~~2021, the allowance for Commercial & Agriculture loans increased due to an increase in general reserves required for this type as a result of ~~higher~~an increase in non-PPP loan balances. Commercial & Agriculture loan balances decreased during the quarter mainly as a result of the forgiveness and ~~higher loss rates in criticized~~payoff of PPP loans. The result was represented as an increase in the provision. The allowance for Commercial Real Estate – Owner Occupied loans ~~was reduced not only by a decrease~~increased due to an increase in ~~specific~~general reserves required for this type ~~but also by decreases in past due, classified and non-accrual loans for this type. The~~as a result of ~~these changes~~increased loan balances, offset by a decrease in classified loans balances. The result was represented as ~~a decrease~~an increase in the provision. The ~~decrease in~~ allowance for Commercial Real Estate – Non-Owner Occupied loans ~~was the result of a decrease~~decreased due to decreases in classified loan balances and loss rates, offset by an increase in general reserves required as a result of ~~lower loss rates and improvement~~an increase in ~~past due, classified and non-accrual loans for this type. In addition, a payoff on a previously charged down~~ loan ~~was received resulting in a recovery of approximately $1,303. The net result~~balances. This was represented as a decrease in the provision. The allowance for Residential Real Estate loans ~~was reduced by a decrease~~increased due to an increase in ~~general reserves required~~loss rates for this type ~~as a~~of loan. The result ~~of a decrease in loss rates,~~was represented by ~~a decrease~~an increase in the provision. The allowance for Real Estate Construction loans increased due to an increase in loss rates on substandard classified loan balances, offset by lower loan balances. This was represented as an increase in the provision. Management feels that the unallocated amount is appropriate and within the relevant range for the allowance that is reflective of the risk in the portfolio at September 30, 2021.

For the nine months ended September 30, 2022, the Company provided $1,000 to the allowance for loan losses, as compared to a provision of $830 for the nine months ended September 30, 2021. The increase in provision was due to the strong loan growth during the first nine months of 2022, as compared to the first nine months of 2021. In addition, the challenges of the international, national, regional and local economic conditions, particularly inflation, have taken greater focus from the prior economic shutdown and restrictions in response to the COVID-19 pandemic. Despite these concerns our portfolio quality has remained stable overall with decreases in criticized loans. We continue to be optimistic that asset quality will continue to remain strong despite ongoing headwinds. While we remain cautious given the impact of inflation on all of our borrowers, we are encouraged by strong loan growth.

During the nine months ended September 30, 2022, the allowance for Commercial & Agriculture loans increased due to an increase in general reserves required for this type as a result of an increase in loss rates, partially offset by a decrease in Commercial & Agriculture loan ~~which~~balances during the first nine months of the year mainly due to the forgiveness or payoff of PPP loans. The result was represented as an increase in the provision. The allowance for ~~Farm~~Commercial Real Estate – Owner Occupied loans ~~was reduced by a decrease~~increased due to an increase in general reserves required for this type as a result of ~~lower outstanding~~increased loan ~~balances~~balances. The result was represented as an increase in the provision. The allowance for Commercial Real Estate – Non-Owner Occupied loans increased due to an increase in general reserves required as a result of an increase in loan balances. This was represented as an increase in the provision. The allowance for Residential Real Estate loans increased due to an increase in general reserves required for this type as a result of increased loan balances. The result was represented by an increase in the provision. The allowance for Real Estate Construction loans increased due to an increase in loan balances. This was represented as an increase in the provision. The allowance for Consumer and Other loans decreased due to a decrease in ~~loss rates. The result of these changes~~loan balances. This was represented as a decrease in the provision. Management feels that the unallocated amount is appropriate and within the relevant range for the allowance that is reflective of the risk in the ~~portfolio.~~portfolio at September 30, 2022.

For the ~~three~~nine months ended September 30, ~~2017~~2021, the Company provided $830 to the allowance for loan losses. The decrease in the provision in the first nine months of 2021 as compared to the same period of 2020, was due to the stability of our metrics coupled with the stabilization and, in some cases, improvement of international, national, regional and local economic conditions that were adversely impacted by the 2020 economic shutdown and restrictions in response to the ongoing COVID-19 pandemic.

For the ~~three~~nine months ended September 30, ~~2017,~~2021, the allowance for Commercial & Agriculture loans ~~increased~~decreased due to ~~an increase~~a decrease in general reserves required for this type as a result of ~~higher~~a decrease in loss rates. Commercial & Agriculture loan balances ~~offset by net recoveries.~~decreased during the period mainly from Civista’s participation in the PPP loan program. The result was represented as a decrease in the provision. The allowance for Commercial Real Estate – Owner Occupied loans increased due to an increase in general reserves required for this type as a result of ~~higher outstanding~~increased loan balances, ~~and loss rates.~~offset by decreases in classified loan balances. The result was represented as an increase in the provision. The allowance for Commercial Real Estate – Non-Owner Occupied loans increased due to an increase in general reserves required ~~for this type~~ as a result of ~~higher~~an increase in loan balances, offset by a decrease in classified loan balances and by ~~higher loss rates. The allowance for Residential Real Estate loans was reduced by a decrease in general reserves required for this type as a result of~~ a decrease in loss rates, represented by a decrease in the provision. The allowance for Real Estate Construction loans increased due to higher outstanding loan balances for this type of loan and recoveries. Management feels that the unallocated amount is appropriate and within the relevant range for the allowance that is reflective of the risk in the portfolio.

For the three months ended September 30, 2016, the allowance for Commercial & Agriculture loans increased due to an increase in general reserves as a result of higher loss rates and an increase in loan balances. The resultrates. This was represented as an increase in the provision. The decrease in allowance for Commercial Real Estate – Non-Owner Occupied loans was the result of a decrease in general reserves required as a result of lower loss rates and improvement in past due, classified and non-accrual loans for this type. The net result was represented as a decrease in the provision. The allowance for Residential Real Estate loans ~~was reduced by a decrease~~increased due to an increase in ~~general reserves required~~recoveries for this type ~~as a~~of loan. The result ~~of a decrease in loss rates,~~was represented by a decrease in the provision. The allowance for Real Estate Construction loans increased due to an increase in ~~loss rates for this type of~~ loan ~~which was~~balances, represented asby an increase in the provision. The allowance for Farm Real Estate loans ~~was reduced by~~decreased due to a decrease in general reserves required for this type as a result of ~~lower outstanding~~decreased loan ~~balances,~~balances. The result was represented as a decrease in the provision. Management feels that the unallocated amount is appropriate and within the relevant range for the allowance that is reflective of the risk in the ~~portfolio.~~portfolio at September 30, 2021.

The following tables present, by portfolio segment, the allocation of the allowance for loan losses and related loan balances as of September 30, ~~2017~~2022 and December 31, ~~2016.~~2021.

September 30, 2017	Loans acquired with credit deterioration		Loans individually evaluated for impairment		Loans collectively evaluated for impairment		Total
September 30, 2022									Loans acquired with credit deterioration		Loans individually evaluated for impairment		Loans collectively evaluated for impairment		Total
Allowance for loan losses:
Commercial & Agriculture	$	81	$	122	$	1,408	$	1,611	$	—	$	—	$	2,729	$	2,729
Commercial Real Estate:
Owner Occupied		—		4		2,069		2,073		—		6		4,920		4,926
Non-Owner Occupied		—		—		5,273		5,273		—		—		14,427		14,427
Residential Real Estate		52		114		2,313		2,479		—		1		3,035		3,036
Real Estate Construction		—		—		667		667		—		—		2,013		2,013
Farm Real Estate		—		6		418		424		—		—		251		251
Consumer and Other		—		—		325		325		—		—		142		142
Unallocated		—		—		94		94		—		—		249		249
Total	$	133	$	246	$	12,567	$	12,946	$	—	$	7	$	27,766	$	27,773
Outstanding loan balances:
Commercial & Agriculture	$	89	$	1,170	$	146,278	$	147,537	$	809	$	343	$	226,235	$	227,387
Commercial Real Estate:
Owner Occupied		—		1,039		166,639		167,678		1,770		833		361,865		364,468
Non-Owner Occupied		—		50		424,380		424,430		120		140		955,909		956,169
Residential Real Estate		139		1,386		266,314		267,839		1,410		586		529,168		531,164
Real Estate Construction		—		—		77,978		77,978		—		—		202,793		202,793
Farm Real Estate		—		613		38,353		38,966		—		—		25,636		25,636
Consumer and Other		—		—		17,564		17,564		1		—		20,996		20,997
Total	$	228	$	4,258	$	1,137,506	$	1,141,992	$	4,110	$	1,902	$	2,322,602	$	2,328,614

December 31, 2021	Loans acquired with credit deterioration		Loans individually evaluated for impairment		Loans collectively evaluated for impairment		Total
Allowance for loan losses:
Commercial & Agriculture	$	—	$	—	$	2,600	$	2,600
Commercial Real Estate:
Owner Occupied		—		7		4,457		4,464
Non-Owner Occupied		—		—		13,860		13,860
Residential Real Estate		—		11		2,586		2,597
Real Estate Construction		—		—		1,810		1,810
Farm Real Estate		—		—		287		287
Consumer and Other		—		—		176		176
Unallocated		—		—		847		847
Total	$	—	$	18	$	26,623	$	26,641
Outstanding loan balances:
Commercial & Agriculture	$	—	$	—	$	246,502	$	246,502
Commercial Real Estate:
Owner Occupied		—		187		295,265		295,452
Non-Owner Occupied		—		0		829,310		829,310
Residential Real Estate		290		526		429,244		430,060
Real Estate Construction		—		—		157,127		157,127
Farm Real Estate		—		509		27,910		28,419
Consumer and Other		—		—		11,009		11,009
Total	$	290	$	1,222	$	1,996,367	$	1,997,879

December 31, 2016

Loans acquired
with credit
deterioration

Loans individually
evaluated for
impairment

Loans collectively
evaluated for
impairment

Total

Allowance for loan losses:

Commercial & Agriculture

$
86

$
82

$
1,850

$
2,018

Commercial Real Estate:

Owner Occupied

—

4

2,167

2,171

Non-Owner Occupied

—

—

4,606

4,606

Residential Real Estate

89

102

2,898

3,089

Real Estate Construction

—

—

420

420

Farm Real Estate

—

—

442

442

Consumer and Other

—

—

314

314

Unallocated

—

—

245

245

Total

$
175

$
188

$
12,942

$
13,305

Outstanding loan balances:

Commercial & Agriculture

$
88

$
1,983

$
133,391

$
135,462

Commercial Real Estate:

Owner Occupied

—

1,896

159,468

161,364

Non-Owner Occupied

—

359

395,572

395,931

Residential Real Estate

168

1,686

245,454

247,308

Real Estate Construction

—

—

56,293

56,293

Farm Real Estate

—

614

40,556

41,170

Consumer and Other

—

1

17,977

17,978

Total

$
256

$
6,539

$
1,048,711

$
1,055,506

The following tables present credit exposures by internally assigned risk grades as of September 30, ~~2017~~2022 and December 31, ~~2016.~~2021. The risk rating analysis estimates the capability of the borrower to repay the contractual obligations of the loan agreements as scheduled or at all. The Company’s internal credit risk grading system is based on experiences with similarly graded loans.

~~Pass~~ –Generally, Residential Real Estate, Real Estate Construction and Consumer and Other loans ~~which~~ are ~~protected by the current net worth and paying capacity of the obligor or by the value of the underlying collateral.~~

~~Substandard~~ –business purpose. Only those loans that have ~~a well-defined weakness based on objective evidence and~~been risk rated are ~~characterized by the distinct possibility that Civista will sustain some loss if the deficiencies are not corrected.~~included below.

September 30, 2022	Pass		Special Mention		Substandard		Doubtful		Ending Balance
Commercial & Agriculture	$	212,692	$	12,155	$	2,540	$	—	$	227,387
Commercial Real Estate:
Owner Occupied		351,464		9,751		3,253		—		364,468
Non-Owner Occupied		932,606		19,526		4,037		—		956,169
Residential Real Estate		141,827		116		5,506		—		147,449
Real Estate Construction		172,120		—		3		—		172,123
Farm Real Estate		25,197		392		47		—		25,636
Consumer and Other		11,993		—		27		—		12,020
Total	$	1,847,899	$	41,940	$	15,413	$	—	$	1,905,252

December 31, 2021	Pass		Special Mention		Substandard		Doubtful		Ending Balance
Commercial & Agriculture	$	244,787	$	526	$	1,189	$	—	$	246,502
Commercial Real Estate:
Owner Occupied		290,617		3,119		1,716		—		295,452
Non-Owner Occupied		764,181		28,042		37,087		—		829,310
Residential Real Estate		77,594		164		4,455		—		82,213
Real Estate Construction		136,149		260		5		—		136,414
Farm Real Estate		27,023		205		1,191		—		28,419
Consumer and Other		764		—		20		—		784
Total	$	1,541,115	$	32,316	$	45,663	$	—	$	1,619,094

~~Doubtful~~ – loans classified as doubtful have all the weaknesses inherent in a substandard asset. In addition, these weaknesses make collection or liquidation in full highly questionable and improbable, based on existing circumstances.

~~Loss~~ ~~– loans classified as a loss are considered uncollectible, or of such value that continuance as an asset is not warranted.~~

Page 1619

Civista Bancshares, Inc.

Notes to Interim Consolidated Financial Statements (Unaudited)

Form 10-Q

(Amounts in thousands, except share data)

~~Generally, Residential Real Estate, Real Estate Construction and Consumer and Other loans are not risk-graded, except when collateral is used for a business purpose.~~

September 30, 2017

Pass

Special Mention

Substandard

Doubtful

Ending Balance

Commercial & Agriculture

$
140,866

$
4,697

$
1,974

$
—

$
147,537

Commercial Real Estate:

Owner Occupied

156,583

7,119

3,976

—

167,678

Non-Owner Occupied

421,452

2,174

804

—

424,430

Residential Real Estate

63,081

2,054

5,998

—

71,133

Real Estate Construction

73,581

15

27

—

73,623

Farm Real Estate

30,604

6,513

1,849

—

38,966

Consumer and Other

1,598

—

75

—

1,673

Total

$
887,765

$
22,572

$
14,703

$
—

$
925,040

December 31, 2016

Pass

Special Mention

Substandard

Doubtful

Ending Balance

Commercial & Agriculture

$
127,867

$
4,300

$
3,295

$
—

$
135,462

Commercial Real Estate:

Owner Occupied

151,659

4,016

5,689

—

161,364

Non-Owner Occupied

393,592

1,676

663

—

395,931

Residential Real Estate

59,015

1,661

6,911

—

67,587

Real Estate Construction

50,678

16

27

—

50,721

Farm Real Estate

31,814

5,673

3,683

—

41,170

Consumer and Other

2,135

—

109

—

2,244

Total

$
816,760

$
17,342

$
20,377

$
—

$
854,479

The following tables present performing and nonperforming loans based solely on payment activity for the periods ended September 30, ~~2017~~2022 and December 31, ~~2016~~2021 that have not been assigned an internal risk grade. The types of loans presented here are not assigned a risk grade unless there is evidence of a problem. Payment activity is reviewed by management on a monthly basis to evaluate performance. Loans are considered to be nonperforming when they become 90 days past due orand if management ~~thinks~~determines that we may not collect all of our principal and interest. Nonperforming loans also include certain loans that have been modified in Troubled Debt Restructurings (TDRs) where economic concessions have been granted to borrowers who have experienced or are expected to experience financial difficulties. These concessions typically result from the Company’s loss mitigation activities and could include reductions in the interest rate, payment extensions, forgiveness of principal, forbearance or other actions due to economic status. Certain TDRs are classified as nonperforming at the time of restructure and may only be returned to performing status after considering the borrower’s sustained repayment performance for a reasonable period, generally six months.

September 30, 2017	Residential Real Estate		Real Estate Construction		Consumer and Other		Total
September 30, 2022									Residential Real Estate		Real Estate Construction		Consumer and Other		Total
Performing	$	196,706	$	4,355	$	15,847	$	216,908	$	383,389	$	30,670	$	8,977	$	423,036
Nonperforming		—		—		44		44		326		—		—		326
Total	$	196,706	$	4,355	$	15,891	$	216,952	$	383,715	$	30,670	$	8,977	$	423,362

December 31, 2016	Residential Real Estate		Real Estate Construction		Consumer and Other		Total
December 31, 2021									Residential Real Estate		Real Estate Construction		Consumer and Other		Total
Performing	$	179,721	$	5,572	$	15,725	$	201,018	$	347,847	$	20,713	$	10,225	$	378,785
Nonperforming		—		—		9		9		—		—		—		—
Total	$	179,721	$	5,572	$	15,734	$	201,027	$	347,847	$	20,713	$	10,225	$	378,785

The following tables include an aging analysis of the recorded investment of past due loans outstanding as of September 30, 2022 and December 31, 2021.

September 30, 2022	30-59 Days Past Due		60-89 Days Past Due		90 Days or Greater Past Due		Total Past Due		Current		Purchased Credit- Impaired Loans		Total Loans		Past Due 90 Days and Accruing
Commercial & Agriculture	$	423	$	2	$	694	$	1,119	$	225,459	$	809	$	227,387	$	—
Commercial Real Estate:
Owner Occupied		24		—		79		103		362,595		1,770		364,468		—
Non-Owner Occupied		—		—		2		2		956,047		120		956,169		—
Residential Real Estate		416		827		1,222		2,465		527,289		1,410		531,164		326
Real Estate Construction		—		—		—		—		202,793		—		202,793		—
Farm Real Estate		—		—		—		—		25,636		—		25,636		—
Consumer and Other		58		63		52		173		20,823		1		20,997		—
Total	$	921	$	892	$	2,049	$	3,862	$	2,320,642	$	4,110	$	2,328,614	$	326

December 31, 2021	30-59 Days Past Due		60-89 Days Past Due		90 Days or Greater Past Due		Total Past Due		Current		Purchased Credit- Impaired Loans		Total Loans		Past Due 90 Days and Accruing
Commercial & Agriculture	$	249	$	13	$	78	$	340	$	246,162	$	—	$	246,502	$	—
Commercial Real Estate:
Owner Occupied		—		—		106		106		295,346		—		295,452		—
Non-Owner Occupied		—		—		4		4		829,306		—		829,310		—
Residential Real Estate		1,848		879		842		3,569		426,201		290		430,060		—
Real Estate Construction		—		—		—		—		157,127		—		157,127		—
Farm Real Estate		—		—		—		—		28,419		—		28,419		—
Consumer and Other		42		—		9		51		10,958		—		11,009		—
Total	$	2,139	$	892	$	1,039	$	4,070	$	1,993,519	$	290	$	1,997,879	$	—

~~The following tables include an aging analysis of the recorded investment of past due loans outstanding as of September 30, 2017 and December 31, 2016.~~

September 30, 2017

30-59 Days
Past Due

60-89 Days
Past Due

90 Days
or Greater

Total Past
Due

Current

Purchased
Credit-
Impaired
Loans

Total Loans

Past Due
90 Days
and
Accruing

Commercial & Agriculture

$
389

$
—

$
664

$
1,053

$
146,395

$
89

$
147,537

$
—

Commercial Real Estate:

Owner Occupied

—

174

516

690

166,988

—

167,678

—

Non-Owner Occupied

164

108

420

692

423,738

—

424,430

—

Residential Real Estate

218

242

878

1,338

266,362

139

267,839

—

Real Estate Construction

—

68

27

95

77,883

—

77,978

—

Farm Real Estate

—

—

193

193

38,773

—

38,966

—

Consumer and Other

86

10

48

144

17,420

—

17,564

44

Total

$
857

$
602

$
2,746

$
4,205

$
1,137,559

$
228

$
1,141,992

$
44

December 31, 2016

30-59 Days
Past Due

60-89 Days
Past Due

90 Days
or Greater

Total Past Due

Current

Purchased
Credit-
Impaired
Loans

Total Loans

Past Due
90 Days
and
Accruing

Commercial & Agriculture

$
156

$
20

$
152

$
328

$
135,046

$
88

$
135,462

$
—

Commercial Real Estate:

Owner Occupied

722

553

280

1,555

159,809

—

161,364

—

Non-Owner Occupied

147

—

316

463

395,468

—

395,931

—

Residential Real Estate

1,812

507

1,049

3,368

243,772

168

247,308

—

Real Estate Construction

—

—

27

27

56,266

—

56,293

—

Farm Real Estate

93

—

—

93

41,077

—

41,170

—

Consumer and Other

215

31

31

277

17,701

—

17,978

9

Total

$
3,145

$
1,111

$
1,855

$
6,111

$
1,049,139

$
256

$
1,055,506

$
9

The following table presents loans on nonaccrual status, excluding purchased credit-impaired (PCI) loans, as of September 30, ~~2017~~2022 and December 31, ~~2016.~~2021.

	September 30, 2017		December 31, 2016		September 30, 2022		December 31, 2021
Commercial & Agriculture	$	1,889	$	1,622	$	668	$	78
Commercial Real Estate:
Owner Occupied		1,989		1,461		206		334
Non-Owner Occupied		566		464		2		4
Residential Real Estate		2,798		3,266		3,514		3,232
Real Estate Construction		27		27		3		5
Farm Real Estate		193		2		—		—
Consumer and Other		70		101		60		20
Total	$	7,532	$	6,943	$	4,453	$	3,673

Nonaccrual Loans: Loans are considered for nonaccrual status upon reaching 90 days delinquency, unless the loan is well secured and in the process of collection, although the Company may be receiving partial payments of interest and partial repayments of principal on such loans. When a loan is placed on nonaccrual status, previously accrued but unpaid interest is deducted from interest income. Payments received on nonaccrual loans are applied to the unpaid principal balance. A loan may be returned to accruing status only if one of three conditions are met: the loan is well-secured and none of the principal and interest has been past due for a minimum of 90 days; the loan is a TDR and has made a minimum of six months payments; or the principal and interest payments are reasonably assured and a sustained period of performance has occurred, generally six months.

Modifications: A modification of a loan constitutes a TDR when the Company for economic or legal reasons related to a borrower’s financial difficulties grants a concession to the borrower that it would not otherwise consider. Exceptions to this policy exist for loan modifications granted as part of the Company’s COVID-19 deferral program, which allows the Company to not classify a modification so long as certain criteria as established in the Coronavirus Aid, Relief, and Economic Security Act of 2020, as amended (the “CARES Act”) are met at the time of the modification. The Company offers various types of concessions when modifying a loan, however, forgiveness of principal is rarely granted. Commercial Real Estate loans modified in a TDR often involve reducing the interest rate lower than the current market rate for new debt with similar risk. Residential Real Estate loans modified in a TDR ~~were~~ primarily ~~comprised of~~involve interest rate reductions where monthly payments ~~were~~are lowered to accommodate the borrowers’ financial needs.

Loans modified in a TDR are typically already on non-accrual status and partial charge-offs have in some cases already been taken against the outstanding loan balance. As a result, loans modified in a TDR may have the financial effect of increasing the specific allowance associated with the loan. An allowance for impaired loans that have been modified in a TDR are measured based on the present value of expected future cash flows discounted at the loan’s effective interest rate or the fair value of the collateral, less any selling costs, if the loan is collateral dependent. Management exercises significant judgment in developing these estimates. As of September 30, ~~2017,~~2022, TDRs accounted for ~~$298~~$7 of the allowance for loan losses. As of December 31, ~~2016,~~2021, TDRs accounted for ~~$278~~$18 of the allowance for loan losses.

~~Loan modifications that are considered~~There were no loans modified as TDRs ~~completed~~ during the three- and nine-month periods ended September 30, ~~2017 and September 30, 2016 were as follows:~~2022 or 2021.

Recidivism, or the borrower defaulting on its obligation pursuant to a modified loan, results in the loan once again becoming a non-accrual loan. Recidivism occurs at a notably higher rate than do defaults on new origination loans, so modified loans present a higher risk of loss than do new origination loans.

During ~~both~~ the three- and nine-month periods ended September 30, ~~2017~~2022 and September 30, ~~2016,~~2021, there were no defaults on loans that were modified and considered TDRs during the respective previous twelve ~~previous~~ months.

Impaired Loans: Larger (greater than $350) Commercial & Agricultural and Commercial Real Estate loan relationships, all TDRs and Residential Real Estate and Consumer loans that are part of a larger relationship are tested for impairment on a quarterly basis. These loans are analyzed to determine if it is probable that all amounts will not be collected according to the contractual terms of the loan agreement. If management determines that the value of the impaired loan is less than the recorded investment in the loan (net of previous charge-offs, deferred loan fees or costs and unamortized premium or discount), impairment is recognized through an allowance estimate or a charge-off to the allowance. The Company’s policy for recognizing interest income on impaired loans does not differ from its overall policy for interest recognition.

The following table includes the recorded investment and unpaid principal balances for impaired ~~financing receivables,~~loans, excluding PCI loans, with the associated allowance amount, if applicable, as of September 30, ~~2017~~2022 and December 31, ~~2016.~~2021.

	September 30, 2017						December 31, 2016						September 30, 2022						December 31, 2021
	Recorded Investment		Unpaid Principal Balance		Related Allowance		Recorded Investment		Unpaid Principal Balance		Related Allowance		Recorded Investment		Unpaid Principal Balance		Related Allowance		Recorded Investment		Unpaid Principal Balance			Related Allowance
With no related allowance recorded:
Commercial & Agriculture	$	—	$	—			$	1,230	$	1,751			$	343	$	343			$	—	$	—
Commercial Real Estate:
Owner Occupied		814		1,069				1,658		1,803				676		676				—		—	��
Non-Owner Occupied		50		53				359		386				140		140				—		—
Residential Real Estate		996		1,068				1,259		1,590				579		604				503		528
Farm Real Estate		149		149				614		614				—		—				509		509
Consumer and Other		—		—				1		1
Total		2,009		2,339				5,121		6,145				1,738		1,763				1,012		1,037
With an allowance recorded:
Commercial & Agriculture		1,170		1,720	$	122		753		1,303	$	82
Commercial Real Estate:
Owner Occupied		225		225		4		238		238		4		157		157	$	6		187		187		$	7
Non-Owner Occupied		—		—		—		—		—		—
Residential Real Estate		390		394		114		427		431		102		7		11		1		23		27			11
Farm Real Estate		464		464		6		—		—		—
Total		2,249		2,803		246		1,418		1,972		188		164		168		7		210		214			18
Total:
Commercial & Agriculture		1,170		1,720		122		1,983		3,054		82		343		343		—		—		—			—
Commercial Real Estate:
Owner Occupied		1,039		1,294		4		1,896		2,041		4		833		833		6		187		187			7
Non-Owner Occupied		50		53		—		359		386		—		140		140		—		—		—			—
Residential Real Estate		1,386		1,462		114		1,686		2,021		102		586		615		1		526		555			11
Farm Real Estate		613		613		6		614		614		—		—		—		—		509		509			—
Consumer and Other		—		—		—		1		1		—
Total	$	4,258	$	5,142	$	246	$	6,539	$	8,117	$	188	$	1,902	$	1,931	$	7	$	1,222	$	1,251		$	18

The following table includes the average recorded investment and interest income recognized for impaired financing receivables for the three- and nine-month periods ended September 30, ~~2017~~2022 and ~~2016.~~2021.

	September 30, 2017				September 30, 2016				September 30, 2022				September 30, 2021
For the three months ended:	Average Recorded Investment		Interest Income Recognized		Average Recorded Investment		Interest Income Recognized
For the three months ended									Average Recorded Investment		Interest Income Recognized		Average Recorded Investment		Interest Income Recognized
Commercial & Agriculture	$	1,366	$	7	$	2,401	$	8	$	172	$	—	$	—	$	—
Commercial Real Estate—Owner Occupied		1,377		18		1,774		21		504		3		252		4
Commercial Real Estate—Non-Owner Occupied		202		2		556		1		70		—		15		—
Residential Real Estate		1,437		17		1,873		21		503		9		551		8
Real Estate Construction		—		—		—		—
Farm Real Estate		614		8		1,032		7		247		2		557		6
Consumer and Other		—		—		2		—
Total	$	4,996	$	52	$	7,638	$	58	$	1,496	$	14	$	1,375	$	18

~~Changes in the amortizable yield for PCI loans were as follows, since acquisition:~~

~~The following table presents additional information regarding loans acquired and accounted for in accordance with ASC 310-30:~~

There has been $133 and $175 in allowance for loan losses recorded for acquired loans with or without specific evidence of deterioration in credit quality as of September 30, 2017 and December 31, 2016, respectively.

Changes in the accretable yield for PCI loans were as follows, since acquisition:

The following table presents additional information regarding loans acquired and accounted for in accordance with ASC 310-30:

There was no allowance for loan losses recorded for acquired loans with or without specific evidence of deterioration in credit quality as of September 30, 2022 or December 31, 2021.

Foreclosed assets acquired in settlement of loans are carried at fair value less estimated costs to sell and are included in ~~other~~Other assets on the Consolidated Balance Sheet. As of September 30, ~~2017~~2022 and December 31, ~~2016, a total of $27 and $37, respectively of~~2021, there were no foreclosed assets ~~were~~ included ~~with other~~in Other assets. As of September 30, 2017, included within the foreclosed assets is $27 of consumer residential mortgages that were foreclosed on or received via a deed in lieu transaction prior to the period end. As of September 30, 20172022 and December 31, ~~2016,~~2021, the Company had initiated formal foreclosure procedures on ~~$251~~$488 and ~~$710,~~$293, respectively, of consumer residential mortgages.

~~The following table presents the changes in each component of accumulated other comprehensive income (loss), net of tax.~~

~~The following table presents the amounts reclassified out of each component of accumulated other comprehensive income (loss).~~

The following table presents the changes in each component of accumulated other comprehensive income (loss), net of tax for the three-month periods ended September 30, 2022 and September 30, 2021.

For the Three-Month Period Ended

For the Three-Month Period Ended

September 30, 2017 (a)

September 30, 2016 (a)

Unrealized
Gains and
Losses on
Available-for-
Sale
Securities

Defined
Benefit
Pension
Items

Total

Unrealized
Gains and
Losses on
Available-for-
Sale
Securities

Defined
Benefit
Pension
Items

Total

Beginning balance

$
3,266

$
(4,002
)

$
(736
)

$
5,863

$
(3,939
)

$
1,924

Other comprehensive income before reclassifications

51

—

51

(796
)

—

(796
)
Amounts reclassified from accumulated other
comprehensive loss

6

282

288

(12
)

55

43

Net current-period other comprehensive income

57

282

339

(808
)

55

(753
)
Ending balance

$
3,323

$
(3,720
)

$
(397
)

$
5,055

$
(3,884
)

$
1,171

	For the Three-Month Period Ended									For the Three-Month Period Ended
	September 30, 2022(a)									September 30, 2021(a)
	Unrealized Gains and (Losses) on Available-for- Sale Securities (a)			Defined Benefit Pension Items (a)			Total (a)			Unrealized Gains and (Losses) on Available-for- Sale Securities (a)			Defined Benefit Pension Items (a)			Total (a)
Beginning balance	$	(40,497	)	$	(5,745	)	$	(46,242	)	$	18,392		$	(6,699	)	$	11,693
Other comprehensive income (loss) before reclassifications		(23,626	)		—			(23,626	)		(2,455	)		—			(2,455	)
Amounts reclassified from accumulated other comprehensive income (loss)		(4	)		54			50			(4	)		64			60
Net current-period other comprehensive income (loss)		(23,630	)		54			(23,576	)		(2,459	)		64			(2,395	)
Ending balance	$	(64,127	)	$	(5,691	)	$	(69,818	)	$	15,933		$	(6,635	)	$	9,298

The following table presents the amounts reclassified out of each component of accumulated other comprehensive income (loss). for the three-month periods ended September 30, 2022 and September 30, 2021.

	Amount Reclassified from Accumulated Other Comprehensive Income (Loss) (a)							Amount Reclassified from Accumulated Other Comprehensive Income (Loss) (a)
Details about Accumulated Other Comprehensive (Loss) Components	For the three months ended September 30, 2017			For the three months ended September 30, 2016			Affected Line Item in the Statement Where Net Income is Presented
Unrealized gains and losses on available-for-sale securities	$	(9	)	$	18		Net gain (loss) on securities available for sale
Details about Accumulated Other Comprehensive Income (Loss) Components								For the Three months ended September 30, 2022			For the Three months ended September 30, 2021			Affected Line Item in the Statement Where Net Income is Presented
Unrealized gains (losses) on available-for-sale securities								$	4		$	4		Net gain on sale of securities
Tax effect		3			(6	)	Income tax expense		—			—		Income tax expense
		(6	)		12		Net of tax		4			4
Amortization of defined benefit pension items
Actuarial gains/(losses) (b)		(426	)		(83	)	Salaries, wages and benefits		(69	)		(81	)	Other operating expenses
Tax effect		144			28		Income tax expense		15			17		Income tax expense
		(282	)		(55	)	Net of tax		(54	)		(64	)
Total reclassifications for the period	$	(288	)	$	(43	)	Net of tax	$	(50	)	$	(60	)

The balance of goodwill was $27,095 at September 30, 2017 and December 31, 2016. Management performs an annual evaluation of goodwill for impairment, or more frequently if events or changes in circumstances indicate that the asset might be impaired. Management last performed an evaluation of the Company’s goodwill during the fourth quarter of 2016 and concluded that the Company’s goodwill was not impaired at December 31, 2016.

~~There was no change in the carrying amount of goodwill for the periods ended September 30, 2017 and December 31, 2016.~~

~~Acquired intangible assets, other than goodwill, as of September 30, 2017 and December 31, 2016 were as follows:~~

The following table presents the changes in each component of accumulated other comprehensive income (loss), net of tax for the nine-month periods ended September 30, 2022 and September 30, 2021.

The following table presents the amounts reclassified out of each component of accumulated other comprehensive income (loss) for the nine-month periods ended September 30, 2022 and September 30, 2021.

Aggregate core deposit intangible amortization expense was ~~$158, $172, $483~~$456, and ~~$527~~$223, for the ~~three~~three-months ended September 30, 2022 and 2021, respectively, and $890 and $668 for the nine-months ended September 30, ~~2017~~2022 and ~~2016,~~2021, respectively.

~~Aggregate~~Activity for mortgage servicing rights ~~amortization was $23, $30, $51~~(MSRs) and ~~$45~~the related valuation allowance for the ~~three~~three- and ~~nine-months~~nine-month periods ended September 30, ~~2017~~2022 and ~~2016, respectively.~~September 30, 2021 were as follows:

	Three Months Ended September 30,						Nine Months Ended September 30,
	2022			2021			2022			2021
Loan Servicing Rights:
Balance at Beginning of Period	$	2,664		$	2,745		$	2,642		$	2,246
Additions		91			164			317			562
Additions from acquisition		419			—			419			—
Disposals		—			—			—			—
Amortized to expense		(95	)		(144	)		(299	)		(436	)
Other charges		—			—			—			—
Change in valuation allowance		—			(189	)		—			204
Balance at End of Period	$	3,079		$	2,576		$	3,079		$	2,576


Valuation allowance:
Balance at Beginning of Period	$	—		$	(189	)	$	—		$	204
Additions expensed		—			189			—			261
Reductions credited to operations		—			—			—			(465	)
Direct write-offs		—			—			—			—
Balance at End of Period	$	—		$	—		$	—		$	—

Estimated amortization expense for each of the next five years and thereafter is as follows:

Short-term and other borrowings, which consist of federal funds purchased, securities sold under agreements to repurchase and other short-term borrowings, ~~are included in Federal Home Loan Bank advances on the Consolidated Balance Sheets and~~ are summarized as follows:

Average balance during the period ~~represent~~represents daily averages. Average rate paid represents interest expense divided by the related average balances.

These borrowing transactions can range from overnight to six months in maturity. The average maturity was one day at September 30, ~~2017 and December 31, 2016.~~2022.

Securities sold under agreements to repurchase are used to facilitate the needs of our customers as well as to facilitate our short-term funding needs. Securities sold under repurchase agreements are carried at the amount of cash received in association with the agreement. We continuously monitor the collateral levels and may be required, from time to time, to provide additional collateral based on the fair value of the underlying securities. Securities pledged as collateral under repurchase agreements are maintained with our safekeeping agents.

The following table presents detail regarding the securities pledged as collateral under repurchase agreements as of September 30, ~~2017~~2022 and December 31, ~~2016.~~2021. All of the repurchase agreements are overnight agreements.

	September 30, 2017		December 31, 2016		September 30, 2022		December 31, 2021
Securities pledged for repurchase agreements:
U.S. Treasury securities	$	742	$	1,761	$	20,155	$	16,478
Obligations of U.S. government agencies		14,406		27,164		—		9,017
Total securities pledged	$	15,148	$	28,925	$	20,155	$	25,495
Gross amount of recognized liabilities for repurchase agreements	$	15,148	$	28,925	$	20,155	$	25,495
Amounts related to agreements not included in offsetting disclosures above	$	—	$	—	$	—	$	—

The Company has granted restricted stock awards with non-forfeitable rights, which are considered participating securities. Accordingly, earnings per share is computed using the two-class method as required by ASC 260-10-45. Basic earnings per common share are computed as net income available to common shareholders divided by the weighted average number of common shares outstanding during the ~~period.~~period, which excludes the participating securities. Diluted earnings per common share include the dilutive effect, if any, of additional potential common shares issuable under the Company’s equity incentive plan, computed using the treasury stock ~~method,~~method. The Company had no dilutive securities for the three- and ~~the impact of the Company’s convertible preferred stock using the “if converted” method.~~

~~For the three-month period~~nine-months ended September 30, 2017 there were 2,426,565 dilutive shares related to the Company’s convertible preferred stock. For the nine-month period ended September 30, 2017 there were 2,455,008 dilutive shares related to the Company’s convertible preferred stock. For the three-month period ended September 30, 2016 there were 2,922,609 dilutive shares related to the Company’s convertible preferred stock. For the nine-month period ended September 30, 2016 there were 3,024,712 dilutive shares related to the Company’s convertible preferred stock. Under the “if converted” method, all convertible preferred shares are assumed to be converted into common shares at the corresponding conversion rate. These additional shares are then added to the common shares outstanding to calculate diluted earnings per share.2022 and 2021.

Some financial instruments, such as loan commitments, credit lines, letters of credit and overdraft protection, are issued to meet customers’ financing needs. These are agreements to provide credit or to support the credit of others, as long as the conditions established in the contract are met, and usually have expiration dates. Commitments may expire without being used. Off-balance-sheet risk of credit loss exists up to the face amount of these instruments, although material losses are not anticipated. The same credit policies are used to make such commitments as are used for loans, including obtaining collateral at exercise of commitment. The contractual amounts of financial instruments with off-balance-sheet risk were as follows ~~for~~at September 30, ~~2017~~2022 and December 31, ~~2016:~~2021:

	Contract Amount								Contract Amount
	September 30, 2017				December 31, 2016				September 30, 2022				December 31, 2021
	Fixed Rate		Variable Rate		Fixed Rate		Variable Rate		Fixed Rate		Variable Rate		Fixed Rate		Variable Rate
Commitment to extend credit:
Lines of credit and construction loans	$	8,042	$	271,718	$	6,905	$	202,923	$	45,738	$	544,286	$	33,542	$	455,777
Overdraft protection		6		32,223		5		29,075		10		62,637		7		54,034
Letters of credit		624		317		600		349		615		876		615		731
	$	8,672	$	304,258	$	7,510	$	232,347	$	46,363	$	607,799	$	34,164	$	510,542

Commitments to make loans are generally made for a period of one year or less. Fixed rate loan commitments included in the table above had interest rates ranging from 2.60% to 7.25% at September 30, 2022 and from 3.25% to 8.00% at ~~September 30, 2017 and from 3.25% to 8.75% at~~ December 31, ~~2016.~~2021. Maturities extend up to 30 years.

Civista is required to maintain certain reserve balances on hand in accordance with the Federal Reserve Board requirements. The ~~average~~ reserve balance maintained in accordance with such requirements was ~~$5,223~~$0 on September 30, ~~2017~~2022 and ~~$2,887 on~~ December 31, ~~2016.~~2021.

The Company sponsors a pension plan which is a noncontributory defined benefit retirement plan. Annual payments, subject to the maximum amount deductible for federal income tax purposes, are made to a pension trust fund. In 2006, the Company amended the pension plan to provide that no employee could be added as a participant to the pension plan after December 31, 2006. In 2014, the Company amended the pension plan again to provide that no additional benefits would accrue beyond April 30, 2014.

	Three months ended						Nine months ended						Three months ended						Nine Months Ended
	September 30,						September 30,						September 30,						September 30,
	2017			2016			2017			2016			2022			2021			2022			2021
Service cost	$	—		$	—		$	—		$	—		$	—		$	—		$	—		$	—
Interest cost		171			170			509			509			103			95			310			285
Expected return on plan assets		(283	)		(274	)		(844	)		(821	)		(144	)		(160	)		(432	)		(480	)
Other components		426			83			946			249			69			81			208			244
Net periodic pension benefit	$	314		$	(21	)	$	611		$	(63	)
Net periodic pension cost													$	28		$	16		$	86		$	49

The ~~total amount of~~Company does not expect to make any contribution to its pension ~~contributions expected to be paid by the Company~~plan in ~~2017 is $2,000.~~2022. The Company ~~contributed $500~~made no contribution to its pension plan in ~~2016.~~2021.

At the Company’s 2014 annual meeting, the shareholders adopted the Company’s 2014 Incentive Plan (“2014 Incentive Plan”). The 2014 Incentive Plan authorizes the Company to grant options, stock awards, stock units and other awards for up to 375,000 common shares of the Company. There were ~~292,209~~118,536 shares available for future grants under this plan at September 30, ~~2017.~~2022.

~~During each of~~No options were granted under the ~~last three years,~~2014 Incentive Plan during the periods ended September 30, 2022 and 2021.

Each year, the Board of Directors has awarded restricted common shares to senior officers of the Company. The restricted shares vest ratably over a three-year or five-year period following the grant date. The product of the number of restricted shares granted and the grant date market price of the Company’s common shares determines the fair value of restricted shares awarded under the Company’s 2014 Incentive Plan. Management recognizes compensation expense for the fair value of restricted shares on a straight-line basis over the requisite service period for the entire award.

On ~~January 4, 2016,~~May 25, 2022, directors of the Company’s banking subsidiary, Civista, were paid a retainer in the form of non-restricted common shares of the Company. The aggregate of ~~2,730~~7,224 common shares were issued to Civista directors as payment of their retainer for their service on the Civista Board of Directors covering the period up to the ~~2016~~2023 Annual Meeting. This issuance was expensed in its entirety when the shares were issued in the amount of ~~$32.~~$168.

~~On May 17, 2016, directors of the Company’s banking subsidiary, Civista, were paid a retainer~~

The Company classifies share-based compensation for employees with “Compensation expense” in the ~~form~~Consolidated Statements of non-restricted common shares of the Company. The aggregate of 12,285 common shares were issued to Civista directors as payment of their retainer for their service on the Civista Board of Directors covering the period up to the 2017 Annual Meeting. This issuance was expensed in its entirety when the shares were issued in the amount of $130.

On May 16, 2017, directors of the Company’s banking subsidiary, Civista, were paid a retainer in the form of non-restricted common shares of the Company. The aggregate of 6,804 common shares were issued to Civista directors as payment of their retainer for their service on the Civista Board of Directors covering the period up to the 2018 Annual Meeting. This issuance was expensed in its entirety when the shares were issued in the amount of $144.

Finally, on September 11, 2017, a newly appointed director of the Company’s banking subsidiary, Civista, was paid a retainer in the form of non-restricted common shares of the Company. The aggregate of 367 common shares was issued as payment of her retainer for her service on the Civista Board of Directors covering the period up to the 2018 Annual Meeting. This issuance was expensed in its entirety when the shares were issued in the amount of $8.Operations.

~~No options had been granted under the 2014 Incentive Plan as of September 30, 2017 and 2016.~~

The Company classifies share-based compensation for employees with “Salaries, wages and benefits” in the consolidated statements of operations. Additionally, generally accepted accounting principles require the Company to report: (1) the expense associated with the grants as an adjustment to operating cash flows, and (2) any benefits of realized tax deductions in excess of previously recognized tax benefits on compensation expense as an operating cash flow.

The following is a summary of the ~~status of the~~ Company’s outstanding restricted shares and changes therein for the three- and nine-month periods ended September 30, ~~2017:~~2022:

	Three months ended				Nine months ended					Three months ended				Nine Months Ended
	September 30, 2017				September 30, 2017					September 30, 2022				September 30, 2022
	Number of Restricted Shares		Weighted Average Grant Date Fair Value		Number of Restricted Shares			Weighted Average Grant Date Fair Value		Number of Restricted Shares		Weighted Average Grant Date Fair Value		Number of Restricted Shares			Weighted Average Grant Date Fair Value
Nonvested at beginning of period		42,138	$	15.60		37,050		$	10.77		71,748	$	21.88		69,840		$	20.14
Granted		—		—		17,898			22.15		—		—		31,774			24.51
Vested		—		—		(12,810	)		10.76		—		—		(27,728	)		24.28
Forfeited		—		—		—			—		—		—		(2,138	)		21.99
Nonvested at September 30, 2017		42,138	$	15.60		42,138		$	15.60
Nonvested at end of period											71,748	$	21.88		71,748		$	21.88

The following is a summary of the status of the Company’s ~~awarded~~outstanding restricted shares as of September 30, ~~2017:~~2022:

The Company recorded $153 and $132 of share-based compensation expense during the three months ended September 30, 2022 and 2021, respectively. During the nine months ended September 30, ~~2017,~~2022 and 2021, the Company recorded ~~$225~~$484 and $392, respectively, of share-based compensation ~~expense and $152~~expense. The Company recorded $168 of director retainer fees for shares granted under the 2014 Incentive ~~Plan.~~Plan during the nine months ended September 30, 2022. At September 30, ~~2017,~~2022, the total compensation cost related to unvested awards not yet recognized ~~is $367,~~was $1,078, which iswas expected to be recognized over the weighted average remaining life of the grants of ~~2.93~~2.36 years.

The Company uses a fair value hierarchy to measure fair value. This hierarchy describes three levels of inputs that may be used to measure fair ~~value.~~value: Level 1: Quoted prices for identical assets in active markets that are identifiable on the measurement date; Level 2: Significant other observable inputs, such as quoted prices for similar assets, quoted prices in markets that are not active and other inputs that are observable or can be corroborated by observable market data; and Level 3: Significant unobservable inputs that reflect the Company’s own view about the assumptions that market participants would use in pricing an asset.

Debt securities: The fair values of securities ~~available for sale~~available-for-sale are determined by matrix pricing, which is a mathematical technique widely used in the industry to value debt securities without relying exclusively on quoted prices for the specific securities, but rather by relying on the securities’ relationship to other benchmark quoted securities (Level 2 inputs).

Equity securities: The Company’s equity securities are not actively traded in an open market. The fair ~~values~~value of these equity securities ~~available for sale~~available-for-sale not actively traded in an open market is determined by using market data inputs for similar securities that are observable (Level 2 inputs).

The fair value of the swap asset/liability: The fair value of the swap asset and liability is based on an external derivative model using data inputs based on similar transactions as of the valuation date and classified Level 2. The changes in fair value of these assets/liabilities had no impact on net income or comprehensive income.

Mortgage servicing rights: Mortgage servicing rights do not trade in an active market with readily observable market data. As a result, the Company estimates the fair value of mortgage servicing rights by using a discounted cash flow model to calculate the present value of estimated future net servicing income. The Company stratifies its mortgage servicing portfolio on the basis of loan type. The assumptions used in the discounted cash flow model are those that the Company believes market participants would use in estimating future net servicing income. Significant assumptions in the valuation of mortgage servicing rights include estimated loan repayment rates, the discount rate, servicing costs, and the timing of cash flows, among other factors. Mortgage servicing rights are classified as Level 3 measurements due to the use of significant unobservable inputs, as well as significant management judgment and estimation.

Impaired loans: The Company has measured impairment on impaired loans ~~generally~~ based on the discounted cash flows of the loan or the fair value of the loan’s collateral. Fair value is generally determined based upon independent third-party appraisals of the properties. In some cases, management may adjust the appraised value due to the ageof the appraisal, changes in market conditions, or observable deterioration of the property since the appraisal was completed. Additionally, management makes estimates about expected costs to sell the property which are also included in the net realizable value. If the fair value of the collateral dependent loan is less than the carrying amount of the loan, a specific reserve for the loan is made in the allowance for loan losses or a charge-off is taken to reduce the loan to the fair value of the collateral (less estimated selling costs) and the loan is included as a Level 3 measurement.

~~Other real estate owned:~~ ~~OREO is carried at the lower of cost or fair value, which is measured at the date of foreclosure.~~ If the fair value of the collateral exceeds the carrying amount of the loan, ~~no charge-off or adjustment is necessary,~~then the loan is ~~not considered to be carried at fair value, and is therefore~~ not included in the table ~~below. If the~~below as it is not currently being carried at its fair ~~value of the collateral is less than the carrying amount of the loan, management will charge the loan down to its estimated realizable~~ value. Management may adjust the appraised value due to the age of the appraisal, changes in market conditions, or observable deterioration of the property since the appraisal was completed. In these cases, the properties are categorized in the below table as Level 3 measurements since these adjustments are considered to be unobservable inputs. Income

Assets and expenses from operations are included in other operating expenses. Further declines in the fair value of the collateral subsequent to foreclosure are included in net gain on sale of other real estate owned.

~~Assets~~liabilities measured at fair value are summarized in the tables below.

	Fair Value Measurements at September 30, 2017 Using:						Fair Value Measurements at September 30, 2022 Using:
Assets:	(Level 1)		(Level 2)		(Level 3)		(Level 1)		(Level 2)		(Level 3)
Assets measured at fair value on a recurring basis:
Securities available-for-sale
U.S. Treasury securities and obligations of U.S. Government agencies	$	—	$	31,063	$	—	$	—	$	60,544	$	—
Obligations of states and political subdivisions		—		113,615		—		—		297,807		—
Mortgage-backed securities in government sponsored entities		—		83,923		—		—		243,695		—
Equity securities in financial institutions		—		818		—
Total securities available-for-sale								—		602,046		—
Equity securities								—		2,028		—
Swap asset		—		1,706		—		—		18,448		—
Liabilities measured at fair value on a recurring basis:
Swap liability		—		1,706		—	$	—	$	18,448	$	—
Assets measured at fair value on a nonrecurring basis:
Impaired loans	$	—	$	—	$	1,639
Other real estate owned		—		—		27
Mortgage servicing rights							$	—	$	—	$	3,079

The following table presents quantitative information about the Level 3 significant unobservable inputs for assets and liabilities measured at fair value on a nonrecurring basis at September 30, 2017.

~~The following table presents quantitative information about the Level 3 significant unobservable inputs for assets and liabilities measured at fair value on a nonrecurring basis at December 31, 2016.~~

~~The carrying amount and fair values of financial instruments are as follows:~~

September 30, 2017

Carrying
Amount

Total
Fair Value

Level 1

Level 2

Level 3

Financial Assets:

Cash and due from financial institutions

$
33,394

$
33,394

$
33,394

$
—

$
—

Securities available for sale

229,419

229,419

—

229,419

—

Other securities

14,247

14,247

14,247

—

—

Loans, held for sale

4,662

4,662

4,662

—

—

Loans, net of allowance for loan losses

1,129,046

1,130,083

—

—

1,130,083

Bank owned life insurance

24,981

24,981

24,981

—

—

Accrued interest receivable

4,999

4,999

4,999

—

—

Swap asset

1,706

1,706

—

1,706

—

Financial Liabilities:

Nonmaturing deposits

947,262

947,262

947,262

—

—

Time deposits

254,027

254,017

—

—

254,017

Short-term FHLB advances

41,750

41,722

41,722

—

—

Long-term FHLB advances

15,000

14,966

—

—

14,966

Securities sold under agreement to repurchase

15,148

15,148

15,148

—

—

Subordinated debentures

29,427

29,470

—

—

29,470

Accrued interest payable

244

244

244

—

—

Swap liability

1,706

1,706

—

1,706

—

December 31, 2016

Carrying
Amount

Total
Fair Value

Level 1

Level 2

Level 3

Financial Assets:

Cash and due from financial institutions

$
36,695

$
36,695

$
36,695

$
—

$
—

Securities available for sale

195,864

195,864

—

195,864

—

Loans, held for sale

2,268

2,268

2,268

—

—

Loans, net of allowance for loan losses

1,042,201

1,047,329

—

—

1,047,329

Other securities

14,055

14,055

14,055

—

—

Bank owned life insurance

24,552

24,552

24,552

—

—

Accrued interest receivable

3,854

3,854

3,854

—

—

Swap asset

1,839

1,839

—

1,839

—

Financial Liabilities:

Nonmaturing deposits

913,677

913,677

913,677

—

—

Time deposits

207,426

207,784

—

—

207,784

Short-term FHLB advances

31,000

31,007

31,007

—

—

Long-term FHLB advances

17,500

17,553

—

—

17,553

Securities sold under agreement to repurchase

28,925

28,925

28,925

—

—

Subordinated debentures

29,427

27,414

—

—

27,414

Accrued interest payable

181

181

181

—

—

Swap liability

1,839

1,839

—

1,839

—

~~Cash and due from financial institutions:~~ ~~The carrying amounts for cash and due from financial institutions approximate fair value because they have original maturities of less than 90 days and do not present unanticipated credit concerns.~~

~~Securities available for sale:~~ The fair value of securities are determined by matrix pricing, which is a mathematical technique widely used in the industry to value debt securities without relying exclusively on quoted prices for specific securities, but rather by relying on the securities’ relationship to other benchmark quoted securities (Level 2 inputs). For equity securities, management uses market information related to the value of similar institutions to determine the fair value (Level 2 inputs).

~~Other securities:~~ ~~The carrying value of regulatory stock approximates fair value based on applicable redemption provisions.~~

~~Loans, held-for-sale:~~ Loans held for sale are priced individually at market rates on the day that the loan is locked for commitment to an investor. Because the holding period of such loans is typically short, the carrying value generally approximates the fair value at the time the commitment is received. All loans in the held-for-sale account conform to Fannie Mae underwriting guidelines, with specific intent of the loan being purchased by an investor at the predetermined rate structure.

~~Loans, net of allowance for loan losses:~~ Fair values for loans, other than impaired, are estimated for portfolios of loans with similar financial characteristics. The fair value of performing loans has been estimated by discounting expected future cash flows of the underlying portfolios. The discount rates used in these calculations are generally derived from the treasury yield curve and are calculated by discounting scheduled cash flows through the estimated maturity using estimated market discount rates that reflect the credit and interest rate inherent in the loan. The estimated maturity is based on the Company’s historical experience with repayments for each loan classification. Changes in these significant unobservable inputs used in discounted cash flow analysis, such as the discount rate or prepayment speeds, could lead to changes in the underlying fair value.

~~Bank owned life insurance:~~ ~~The carrying value of bank owned life insurance approximates the fair value based on applicable redemption provisions.~~

~~Accrued interest receivable and payable and securities sold under agreements to repurchase:~~ The carrying amounts for accrued interest receivable, accrued interest payable and securities sold under agreements to repurchase approximate fair value because they are generally received or paid in 90 days or less and do not present unanticipated credit concerns.

~~Deposits:~~ ~~The fair value of deposits with no stated maturity, such as noninterest-bearing demand deposits, savings and NOW accounts, and money market accounts, is equal to the amount payable on demand.~~

The following tables present quantitative information about the Level 3 significant unobservable inputs for assets and liabilities measured at fair value on a nonrecurring basis as of certificates of deposit is based on the discounted value of contractual cash flows. The discount rate is estimated using the market rates currently offered for deposits of similar remaining maturities.September 30, 2022 and December 31, 2021.

The ~~deposits’~~carrying amount and fair values of financial instruments not measured at fair value ~~estimates do~~on a recurring or nonrecurring basis at September 30, 2022 were as follows:

September 30, 2022	Carrying Amount		Total Fair Value		Level 1		Level 2		Level 3
Financial Assets:
Cash and due from financial institutions	$	40,914	$	40,914	$	40,914	$	—	$	—
Other securities		18,578		18,578		18,578		—		—
Loans, held for sale		3,491		3,561		3,561		—		—
Loans, net of allowance		2,300,841		2,200,018		—		—		2,200,018
Bank owned life insurance		53,291		53,291		53,291		—		—
Accrued interest receivable		9,175		9,175		9,175		—		—
Financial Liabilities:
Nonmaturing deposits		2,436,219		2,436,219		2,436,219		—		—
Time deposits		272,034		270,928		—		—		270,928
Short-term FHLB advances		55,000		55,000		55,000		—		—
Long-term FHLB advances		6,723		6,716		—		—		6,716
Securities sold under agreement to repurchase		20,155		20,155		20,155		—		—
Subordinated debentures		103,778		97,890		—		—		97,890
Accrued interest payable		970		970		970		—		—

The carrying amount and fair values of financial instruments not include the benefit that results from the low-cost funding provided by the deposit liabilities compared to the cost of borrowing funds in the market, commonly referred to as the core deposit intangible.

~~Federal Home Loan Bank (“FHLB”) advances:~~ ~~Rates available to the Company for borrowed funds with similar terms and remaining maturities are used to estimate the~~measured at fair value ~~of borrowed funds.~~on a recurring or nonrecurring basis at December 31, 2021 were as follows:

~~Subordinated debentures:~~ The fair value of subordinated debentures is based on the discounted value of contractual cash flows of the underlying debt agreements. The discount rate is estimated using the current rate for the borrowing from the FHLB with the most similar terms.

December 31, 2021	Carrying Amount		Total Fair Value		Level 1		Level 2		Level 3
Financial Assets:
Cash and due from financial institutions	$	264,239	$	264,239	$	264,239	$	—	$	—
Other securities		17,011		17,011		17,011		—		—
Loans, held for sale		1,972		2,011		2,011		—		—
Loans, net of allowance		1,971,238		1,945,638		—		—		1,945,638
Bank owned life insurance		46,641		46,641		46,641		—		—
Accrued interest receivable		7,385		7,385		7,385		—		—
Financial Liabilities:
Nonmaturing deposits		2,170,253		2,170,253		2,170,253		—		—
Time deposits		246,448		247,053		—		—		247,053
Long-term FHLB advances		75,000		75,930		—		—		75,930
Securities sold under agreement to repurchase		25,495		25,495		25,495		—		—
Subordinated debentures		103,735		111,118		—		—		111,118
Accrued interest payable		315		315		315		—		—

~~Fair value swap asset and liability:~~ ~~The fair value of the swap asset and liability is based on an external derivative model using data inputs as of the valuation date.~~

To accommodate customer need and to support the Company’s asset/liability positioning, on occasion we enter into interest rate swaps with a customer and a bank counterparty. The interest rate swaps are free-standing derivatives and are recorded at fair value. The Company enters into a floating rate loan and a fixed rate swap with our customer. Simultaneously, the Company enters into an offsetting fixed rate swap with a bank counterparty. In connection with each swap transaction, the Company agrees to pay interest to the customer on a notional amount at a variable interest rate and receive interest from the customer on the same notional amount at a fixed interest rate. At the same time, the Company agrees to pay a bank counterparty the same fixed interest rate on the same notional amount and receive the same variable interest rate on the same notional amount. These transactions allow the Company’s customer to effectively convert variable rate loans to fixed rate loans. Since the Company acts as an intermediary for its customer, changes in the fair value of the underlying derivative contracts offset each other and do not significantly impact the Company’s results of operations.

~~The following table summarizes~~ None of the Company’s ~~interest rate swap positions and the impact of a 1 basis point change in interest rates~~derivatives are designated as ~~of September 30, 2017.~~hedging instruments.

~~The following table summarizes the Company’s interest rate swap positions and the impact of a 1 basis point change in interest rates as of December 31, 2016.~~

The Company monitors and controls all derivative products with a comprehensive Board of Director approved commercial loan swap policy. All hedge transactions must be approved in advance by the Lenders Loan Committee or the Directors Loan Committee of the Board of Directors.

The Company presents derivative positions net on the balance sheet for customers and financial institution counterparty positions subject to master netting arrangements. The following table reflects the derivatives recorded on the balance sheet:

The presentation for derivatives for the current and prior periods was revised to present derivative positions net for customer positions. Fair value of swap assets and liabilities for the prior period was not impacted.

The effect of swap fair value changes on the Consolidated Statement of Operations are as follows:

The Company monitors and controls all derivative products with a comprehensive Board of Director approved commercial loan swap policy. All interest rate swap transactions must be approved in advance by the Lenders Loan Committee or the Directors Loan Committee of the Board of Directors. The Company classifies changes in fair value of derivatives with “Other” in the Consolidated Statements of Operation.

At September 30, 2022, the Company did not have any cash or securities pledged for collateral on its interest rate swaps with third party financial institutions. At December 31, 2021, the Company had cash and securities with a fair value of $10,780 and $509, respectively, pledged as collateral. Cash pledged for collateral on interest rate swaps is classified as restricted cash on the Consolidated Balance Sheet.

The Company invests in certain qualified affordable housing projects. At September 30, ~~2017~~2022 and December 31, ~~2016,~~2021, the balance of the investment for qualified affordable housing projects was ~~$3,079~~$12,377 and ~~$2,754,~~$13,093, respectively. These balances are reflected in the ~~other~~Other assets line on the Consolidated Balance Sheet. The unfunded commitments related to the investments in qualified affordable housing projects totaled ~~$4,741~~$4,093 and ~~$2,313~~$5,706 at September 30, ~~2017~~2022 and December 31, ~~2016,~~2021, respectively. These balances are reflected in the Accrued expenses and other liabilities line on the Consolidated Balance Sheet.

During the ~~nine~~three months ended September 30, ~~2017~~2022 and ~~2016,~~2021, the Company recognized amortization expense with respect to its investments in qualified affordable housing projects of ~~$247~~$239 and ~~$231,~~$203, respectively, offset by tax credits and other benefits from its investment in affordable housing tax credits of ~~$414~~$396 and ~~$442,~~$339, respectively. During the ~~quarters~~nine months ended September 30, ~~2017~~2022 and ~~2016,~~2021, the Company recognized amortization expense with respect to its investments in qualified affordable housing projects of ~~$82~~$716 and ~~$77,~~$608, respectively, offset by tax credits and other benefits from its investment in affordable housing tax credits of ~~$138~~$1,181 and ~~$147,~~$1,015, respectively. During the ~~three~~three- and ~~nine months~~nine-month periods ended September 30, ~~2017~~2022 and ~~2016,~~2021, the Company did not incur any impairment losses related to its ~~investment~~investments in qualified affordable housing projects. Other operating expenses and Income tax expense were reclassified for the three- and nine-month periods of September 30, 2021 to reflect the change to proportional amortization method of accounting of $203 and $608, respectively.

The Company accounts for revenues from contracts with customers under ASC 606, Revenue from Contracts with Customers. Revenue associated with financial instruments, including revenue from loans and securities, are outside the scope of ASC 606 and accounted for under other existing GAAP. In addition, certain noninterest income streams such as fees associated with mortgage servicing rights, financial guarantees, derivatives, and certain credit card fees are also not in scope of the guidance. Noninterest revenue streams in-scope of ASC 606 are discussed below.

Service charges consist of account analysis fees (i.e., net fees earned on analyzed business and public checking accounts), monthly service fees, and other deposit account related fees. The Company’s performance obligation for account analysis fees and monthly service fees is generally satisfied, and the related revenue recognized, over the period in which the service is provided. Other deposit account related fees are largely transactional based, and therefore, the Company’s performance obligation is satisfied, and related revenue recognized, at a point in time. Payment for service charges on deposit accounts is primarily received immediately or in the following month through a direct charge to customers’ accounts.

Fees, exchange, and other service charges are primarily comprised of debit and credit card income, ATM fees and other service charges. Debit and credit card income is primarily comprised of interchange fees earned whenever the Company’s debit and credit cards are processed through card payment networks such as Mastercard. ATM fees are primarily generated when a Company cardholder uses a non-Company ATM or a non-Company cardholder uses a Company ATM. The Company’s performance obligation for fees, exchange, and other service charges are largely satisfied, and related revenue recognized, when the services are rendered or upon completion. Payment is typically received immediately or in the following month.

Wealth management fees are primarily comprised of fees earned from the management and administration of trusts and other customer assets. The Company’s performance obligation is generally satisfied over time and the resulting fees are recognized monthly, based upon the month-end market value of the assets under management and the applicable fee rate. Payment is generally received in the following month through a direct charge to customers’ accounts. The Company does not earn performance-based incentives. The Company’s performance obligation for these transactional-based services is generally satisfied, and related revenue recognized, at a point in time (i.e., as incurred). Payment is received shortly after services are rendered.

The Company facilitates the payment of federal and state income tax refunds in partnership with a third-party vendor. Refund Transfers (“RTs”) are fee-based products whereby a tax refund is issued to the taxpayer after the Company has received the refund from the federal or state government. As part of this agreement the Company earns fee income, the majority of which is received in the first quarter of the year. The Company’s fee income revenue is recognized based on the estimated percent of business completed by each date.

Other noninterest income consists of other recurring revenue streams such as check order fees, wire transfer fees, safety deposit box rental fees, item processing fees and other miscellaneous revenue streams. Check order income mainly represents fees charged to customers for checks. Wire transfer fees represent revenue from processing wire transfers. Safe deposit box rental fees are charged to the customer on an annual basis and recognized upon receipt of payment. The Company determined that since rentals and renewals occur fairly consistently over time, revenue is recognized on a basis consistent with the duration of the performance obligation. Item processing fee income represents fees charged to other financial institutions for processing their transactions. Payment is typically received in the following month.

The following presents noninterest income, segregated by revenue streams in-scope and out-of-scope of Topic 606, for the three- and nine-months ended September 30, 2022 and 2021.

On July 1, 2022, CBI completed the acquisition by merger of Comunibanc Corp. in a stock and cash transaction for aggregate consideration of approximately $46,090. As a result of the acquisition, the Company issued 984,723 common shares and paid approximately $24,968 in cash to the former shareholders of Comunibanc Corp. The Company and Comunibanc Corp. had first announced that they had entered into an agreement to merge in January of 2022. Immediately following the merger, Comunibanc Corp.’s banking subsidiary, The Henry County Bank (HCB), was merged into CBI’s banking subsidiary, Civista Bank.

The assets and liabilities of Comunibanc Corp. were recorded on the Company’s Balance Sheet at their preliminary estimated fair values as of July 1, 2022, the acquisition date, and Comunibanc Corp.’s results of operations have been included in the Company’s Consolidated Statements of Operations since that date. Due to the timing of the acquisition relative to the end of the reporting period, the fair values for certain assets and liabilities acquired from Comunibanc Corp on July 1, 2022 represent preliminary estimates. Based on a preliminary purchase price allocation, the Company recorded $24,801 in goodwill and $4,426 in core deposit intangibles, representing the principal change in goodwill and intangibles from December 31, 2021. None of the purchase price is deductible for tax purposes.

At the time of the merger, Comunibanc Corp had total consolidated assets of $315,083, including $175,500 in loans, and $271,081 in deposits. The transaction was recorded as a purchase and, accordingly, the operating results of Comunibanc Corp. and HCB have been included in the Company’s Consolidated Financial Statements since the close of business on July 1, 2022.

Identifiable intangibles are amortized to their estimated residual values over the expected useful lives. Such lives are also periodically reassessed to determine if any amortization period adjustments are required. The identifiable intangible assets consist of core deposit intangible which is being amortized over the estimated useful life. The gross carrying amount of the core deposit intangible at September 30, 2022 was $4,426.

In 2022, the Company has incurred additional third-party acquisition-related costs of $1.9 million. These expenses are comprised of employee benefits of $16.6 thousand, occupancy and equipment expenses of $51.6 thousand, software expense of $14.0 thousand, consulting and other professional fees of $839.4 thousand, data processing costs of $558.3 thousand and other operating expenses of $373.0 thousand in the Company’s consolidated statement of operations for the nine-month period ended September 30, 2022.

As of September 30, 2022, the current year and estimated future amortization expense for the core deposit intangible is as follows:

The following table presents financial information for the former Comunibanc Corp. included in the Consolidated Statements of Operations from the date of acquisition through September 30, 2022.

The following table presents pro forma information for the three- and nine-month periods ended September 30, 2022 and 2021 as if the acquisition of Comunibanc Corp. had occurred on January 1, 2021. This table has been prepared for comparative purposes only and is not indicative of the actual results that would have been attained had the acquisition occurred as of the beginning of the periods presented, nor is it indicative of future results. Furthermore, the unaudited pro forma information does not reflect management’s estimate of any revenue-enhancing opportunities nor anticipated cost savings as a result of the integration and consolidation of the acquisition.

The following table summarizes the estimated fair values of the assets acquired and liabilities assumed at the date of acquisition for Comunibanc Corp. Core deposit intangibles will be amortized over periods of between ten years using an accelerated method. Goodwill will not be amortized, but instead will be evaluated for impairment.

Loans purchased with evidence of credit deterioration since origination and for which it was probable that all contractually required payments would not be collected were considered to be credit impaired. Evidence of credit quality deterioration as of the purchase date included information such as past-due and nonaccrual status, borrower credit scores and recent loan to value percentages. Purchased credit-impaired loans were accounted for under the accounting guidance for loans and debt securities acquired with deteriorated credit quality (ASC 310-30) and initially measured at fair value, which included estimated future credit losses expected to be incurred over the life of the loan. Accordingly, an allowance for credit losses related to these loans was not carried over and recorded at the acquisition date. Management estimated the cash flows expected to be collected at acquisition using our internal risk models, which incorporated the estimate of the current assumptions, such as default rates, severity and prepayment speeds.

The following table presents additional information regarding loans acquired and accounted for in accordance with ASC 310-30:

The gross principal due under the contract for acquired receivables not subject to ASC 310-30 is $171.1 million. The fair value adjustment is $2.1 million and the contractual cash flows not expected to be collected is $5.7 million.

The acquired assets and liabilities were measured at estimated fair values. Management made certain estimates and exercised judgment in accounting for the acquisition.

The amount of goodwill recorded reflects a strategic opportunity to expand into new markets that, while similar to existing markets, are projected to be more vibrant in population growth and business opportunity growth. The goodwill represents the excess purchase price over the estimated fair value of the net assets acquired. Additionally, the acquisition will provide exposure to suburbs of larger urban areas without the commitment of operating inside large metropolitan areas dominated by regional and national financial organizations. The acquisition is also expected to create synergies on the operational side of the Company by allowing noninterest expenses to be spread over a larger operating base.

On September 29, 2022, CBI and Civista, entered into a Stock Purchase Agreement (the “Purchase Agreement”) with Vision Financial Group, Inc., a Pennsylvania corporation (“VFG”), and Frederick S. Summers, a resident of the State of Florida (“Seller”), pursuant to which Civista agreed to acquire all of the issued and outstanding shares of capital stock of VFG. VFG is a privately held, independent, full-service equipment leasing and financing company headquartered in Pittsburgh, Pennsylvania. The acquisition of VFG subsequently closed on October 3, 2022.

Under the terms and conditions of the Purchase Agreement, upon closing, Civista acquired all of the issued and outstanding shares of capital stock of VFG from Seller in exchange for: (i) payment to Seller of cash consideration equal to approximately $28,600 (subject to adjustment based on the Shareholder Equity of VFG at the time of closing); and (ii) issuance to Seller and certain members of VFG management of an aggregate of 150,145 shares of CBI common stock (“CBI Shares”), equal to $5,250 divided by the volume weighted average closing price of a CBI Share on The NASDAQ—Capital Market® for the ten consecutive trading days immediately preceding the closing date. Approximately $7,900 of outstanding subordinated debt of VFG was also assumed and paid off by Civista in connection with the transaction. Pursuant to the Purchase Agreement, Seller and certain members of VFG management received an additional amount of contingent consideration in the form of 250,148 restricted CBI Shares with an aggregate value of $5,250. The restricted shares will be subject to vesting or forfeiture based on agreed upon targets of actual originations of equipment leases and similar financing products offered by VFG in 2023 and 2024.

The Purchase Agreement contains customary representations, warranties and covenants by each of the parties and contains indemnification provisions under which the parties agreed, subject to certain limitations, to indemnify each other against certain liabilities. At closing, Civista deposited certain portions of the cash consideration with an escrow agent to be held in escrow and made available to satisfy post-closing indemnification claims under the Purchase Agreement. To supplement the indemnification provided by Seller, Civista obtained representation and warranty insurance.

The purchase price allocation and certain fair value measurements remain preliminary due to the timing of the acquisition. Due to the recent closing, management remains in the early stages of reviewing the estimated fair values and evaluating the assumed tax positions of this acquisition. The Company expects to finalize its analysis of the acquired assets and assumed liabilities in this transaction within one year of the acquisition.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion focuses on the consolidated financial condition of the Company at September 30, ~~2017~~2022 compared to December 31, ~~2016,~~2021, and the consolidated results of operations for the ~~three- and~~three-and nine-month ~~period~~periods ended September 30, ~~2017,~~2022, compared to the same ~~period~~periods in ~~2016.~~2021. This discussion should be read in conjunction with the ~~consolidated financial statements~~Consolidated Financial Statements and footnotes included in this Form 10-Q.

This Quarterly Report on Form 10-Q may contain “forward-looking statements” within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), relating to such matters as the Company’s financial condition, anticipated operating results, cash flows, business line results, credit quality expectations, prospects for new lines of business, economic trends (including interest rates) and similar matters. Forward-looking statements reflect our expectations, estimates or projections concerning future results or events. These statements are generally identified by the use of forward-looking words or phrases such as “believe,” “belief,” “expect,” “anticipate,” “may,” “could,” “intend,” “intent,” “estimate,” “plan,” “foresee,” “likely,” “will,” “should” or other similar words or phrases. Forward-looking statements are not guarantees of performance and are inherently subject to known and unknown risks, uncertainties and assumptions that are difficult to predict and could cause our actual results, performance or achievements to differ materially from those expressed in or implied by the forward-looking statements. Factors that could cause actual results, performance or achievements to differ from ~~results~~those discussed in the forward-looking statements include, but are not limited to:

Management’s Discussion and Analysis of Financial Condition and Results of Operations

(Amounts in financial markets or national or local economic conditions; sustained weakness or deterioration in the real estate market; volatility and direction of market interest rates; credit risks of lending activities; changes in the allowance for loan losses; legislation or regulatory changes or actions; increases in Federal Deposit Insurance Corporation (“FDIC”) insurance premiums and assessments; changes in tax laws; failure of or breach in our information and data processing systems; unforeseen litigation; and other risks identified from time-to-time in the Company’s other public documents on file with the SEC, including those risks identified in “Item 1A. Risk Factors” of Part I of the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2016. thousands, except share data)

The Company does not undertake, and specifically disclaims, any obligation to publicly release the result of any revisions that may be made to any forward-looking statements to reflect occurrence of anticipated or unanticipated events or circumstances after the date of such statements, except as required by law.

Total assets of the Company at September 30, ~~2017~~2022 were ~~$1,496,088~~$3,241,719 compared to ~~$1,377,263~~$3,012,905 at December 31, ~~2016,~~2021, an increase of ~~$118,825,~~$228,814, or ~~8.6%~~7.6%. The increase in total assets was ~~mainly attributable~~due to the Company’s acquisition by merger of Comunibanc Corp. effective July 1, 2022 and increases in loans of $329,603, accompanied by increases in securities ~~available for sale, loans held for sale~~available-for-sale, and ~~loans.~~other assets of $42,172 and $24,260, respectively, partially offset by a decrease in cash and cash equivalents of $223,325. Total liabilities at September 30, ~~2017~~2022 were ~~$1,314,107~~$2,939,117 compared to ~~$1,239,647~~$2,657,693 at December 31, ~~2016,~~2021, an increase of ~~$74,460,~~$281,424, or ~~6.0%~~10.6%. The increase in total liabilities was ~~mainly~~primarily attributable to ~~increases~~an increase in total ~~deposits and~~deposit accounts of $291,552, accompanied by an increase in short term FHLB ~~overnight advances~~borrowings of $55,000, partially offset by ~~a decrease~~decreases in ~~securities sold under agreements to repurchase.~~

~~Loans outstanding as~~long term FHLB borrowings of ~~September 30, 2017 and December 31, 2016 were as follows:~~

Net loans have increased $86,845 or 8.3% since December 31, 2016. The Commercial & Agriculture, Commercial Real Estate – Owner Occupied, Commercial Real Estate – Non-Owner Occupied, Residential Real Estate and Real Estate Construction loan portfolios increased $12,075, $6,314, $28,499, $20,531 and $21,685, respectively, since December 31, 2016, while the Farm Real Estate and Consumer and Other loan portfolios decreased $2,204 and $414, respectively, since December 31, 2016.$68,277.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

Loans outstanding as of September 30, 2022 and December 31, 2021 were as follows:

Included in Commercial & Agriculture loans above were $819 of PPP loans as of September 30, 2022 and $43,209 of PPP loans as of December 31, 2021.

Loans held for sale ~~have~~ increased ~~$2,394~~$1,519, or ~~105.6%~~77.0%, since December 31, ~~2016,~~2021. The increase was due to an increase in ~~originations.~~the average loan balance held for sale. At September 30, ~~2017,~~2022, 19 loans totaling $3,491 were held for sale as compared to 14 loans totaling $1,972 at December 31, 2021.

Net loans have increased $329,603, or 16.7%, since December 31, 2021. The Commercial Real Estate – Owner Occupied, Commercial Real Estate – Non-Owner Occupied, Residential Real Estate, Real Estate Construction and Consumer and Other loan portfolios increased $69,016, $126,859, $101,104, $45,666 and $9,988, respectively, since December 31, 2021, while the Commercial & Agriculture and Farm Real Estate loan portfolios decreased $19,115 and $2,783, respectively, since December 31, 2021. Loans acquired as part of the Comunibanc Corp. acquisition for Commercial & Agriculture, Commercial Real Estate – Owner Occupied, Commercial Real Estate – Non-Owner Occupied, Residential Real Estate, Real Estate Construction, Farm Real Estate and Consumer and Other loan portfolios totaled $9,731, $30,680, $45,731, $61,752, $12,394 $2,872 and $11,757, respectively. At September 30, 2022, the net loan to deposit ratio was ~~94.0%~~85.0% compared to ~~93.0%~~81.6% at December 31, ~~2016.~~2021.The increase in the net loan to deposit ratio is primarily the result of an increase in loans, partially offset by an increase in deposits.

During the first nine months of ~~2017, there were no~~2022, provisions made to the allowance for loan losses ~~from earnings. During~~totaled $1,000, compared to a provision of $830 during the same period in 2021. The increase in provision was due to the strong loan growth during the first nine months of 2016, the Company received a payoff on a nonperforming loan. This particular loan had been analyzed previously and had been charged down based on a deterioration of real estate collateral values during the recent recession. As a result2022. The challenges of the ~~payoff of the loan, the Company recovered the charged down amount of approximately $1,303. The result of the transaction was a credit of $1,300~~international, national, regional and local economic conditions, particularly inflation, has taken greater focus from the ~~allowance for~~prior economic shutdown and restrictions in response to the ongoing COVID-19 pandemic. Despite these concerns, our portfolio quality has remained stable overall with decreases in criticized loans. We continue to be optimistic that asset quality will continue to remain strong despite ongoing headwinds. While we remain cautious given the impact of inflation on all of our borrowers, we are encouraged by strong loan ~~losses during the nine months of operations in 2016.~~ growth.

Net ~~charge-offs~~recoveries for the first nine months of ~~2017~~2022 totaled ~~$359,~~$132, compared to a net ~~recovery~~recoveries of ~~$390~~$710 in the first nine months of ~~2016.~~2021. For the first nine months of ~~2017,~~2022, the Company charged off a total of ~~fifty-four~~14 loans. ~~Twenty-four Real Estate Mortgage loans totaling $312, two~~One Commercial and Agriculture loan totaling ~~$11, four Commercial~~$22, five Residential Real Estate ~~– Owner Occupied loans~~loan totaling ~~$301, one Commercial Real Estate – Non-Owner Occupied totaling $38~~$97 and ~~twenty-three~~eight Consumer and Other loans totaling ~~$135~~$45 were charged off in the first nine months of the year. In addition, during the first nine months of ~~2017,~~2022, the Company had recoveries on previously charged-off Commercial and Agriculture loans of ~~$134,~~$16, Commercial Real Estate – Owner Occupied loans of ~~$26,~~$42, Commercial Real Estate – Non-Owner Occupied loans of ~~$42,~~$68, Residential Real Estate ~~Mortgage~~ loans of ~~$164, Real Estate Construction loans of $32,~~$140, Farm Real Estate loans of $2$5 and Consumer and Other loans of ~~$38.~~$25. For each loan category, as well as in total, the percentage of net charge-offs to loans was less than one percent. Nonperforming loans increased by ~~$624~~$1,106 since December 31, ~~2016,~~2021, which was due to ana $780 increase in loans on nonaccrual status ~~of $589~~ and an increase in loans past due 90 days and accruing of ~~$35.~~$326. Each of these factors was considered by management as part of the examination of both the level and mix of the allowance by loan type as well as the overall level of the allowance.

Management specifically evaluates loans that are impaired for estimates of loss. To evaluate the adequacy of the allowance for loan losses to cover probable losses in the portfolio, management considers specific reserve allocations for identified portfolio loans, reserves for delinquencies and historical reserve allocations. Loss migration rates are calculated over a three-year period for all portfolio segments. Management also considers certain economic factors for trends that management uses to account for the qualitative and environmental changes in risk, which affects the level of the reserve.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

Management analyzes each impaired Commercial and Commercial Real Estate loan relationship with a balance of $350 or larger, on an individual basis and designates a loan as impaired when it is in nonaccrual status or when an analysis of the borrower’s operating results and financial condition ~~indicate~~indicates that underlying cash flows are not adequate to meet its debt service requirements. ~~In addition, loans~~Loans held for sale are excluded from consideration as impaired. Loans are generally moved to nonaccrual status when 90 days or more past due. Impaired loans, or portions thereof, are charged-off when deemed uncollectible. The allowance for loan losses as a percent of total loans was ~~1.13%~~1.19% at September 30, ~~2017~~2022 and ~~1.26%~~1.33% at December 31, ~~2016.~~2021.

The ~~available for sale~~available-for-sale security portfolio increased by ~~$33,555,~~$42,172, from ~~$195,864~~$559,874 at December 31, ~~2016~~2021 to ~~$229,419~~$602,046 at September 30, ~~2017. The increase in the available for sale security portfolio is due to the investment~~2022. Securities acquired as part of the ~~net proceeds from~~acquisition of Comunibanc Corp. totaled $120,399 and $57,322 were sold immediately after the ~~public offering completed by the Company on February 24, 2017.~~merger. Management continually evaluates our securities portfolio in response to established asset/liability management objectives, changing market conditions that could affect profitability and the level of interest rate risk to which the Company is exposed. These evaluations may cause the Company to change the level of funds it deploys into investment securities and change the composition of its investment securities portfolio. As of September 30, ~~2017,~~2022, the Company was in compliance with all pledging requirements.

Premises and equipment, net, ~~have decreased $232~~increased $7,723 from December 31, ~~2016~~2021 to September 30, ~~2017.~~2022. The ~~decrease~~increase is the result of new purchases of ~~$755,~~$3,208, offset by ~~disposals, net of gains of $72,~~ depreciation of ~~$912 and the transfer of $3 of assets to premises~~$1,558. Premises and equipment, ~~held for sale.~~net, acquired from the acquisition of Comunibanc Corp. totaled $6,073.

Goodwill increased by $24,801, from $76,851 at December 31, 2021 to $101,652 at September 30, 2022. The increase is due to the goodwill created from the acquisition of Comunibanc Corp. Other intangible assets increased $3,973 from year-end 2021. The increase includes $4,426 of core deposit intangibles and $419 of mortgage servicing rights from the acquisition of Comunibanc Corp.

Bank owned life insurance (BOLI) increased ~~$429~~$6,650 from December 31, ~~2016~~2021 to September 30, ~~2017.~~2022. BOLI acquired from the merger with Comunibanc Corp. totaled $5,918. The remaining difference is the result of increases in the cash surrender value of the underlying insurance policies.

Swap assets increased $7,376 from December 31, 2021 to September 30, 2022. The increase is primarily the result of an increase in market value.

Deferred taxes available-for-sale securities increased $24,138 from December 31, 2021 to September 30, 2022. The increase is the result of an increase in deferred taxes - securities of $21,044.

Total deposits as of September 30, ~~2017~~2022 and December 31, ~~2016 are~~2021 were as follows:

	September 30, 2017		December 31, 2016		September 30, 2022		December 31, 2021		$ Change		% Change
Noninterest-bearing demand	$	357,539	$	345,588	$	944,241	$	788,906	$	155,335		19.7	%
Interest-bearing demand		188,570		183,759		560,594		537,510		23,084		4.3	%
Savings and money market		401,153		384,330		931,393		843,837		87,556		10.4	%
Time deposits		254,027		207,426		272,025		246,448		25,577		10.4	%
Total Deposits	$	1,201,289	$	1,121,103	$	2,708,253	$	2,416,701	$	291,552		12.1	%

Total deposits at September 30, 2022 increased $291,552 from year-end 2021. Noninterest-bearing deposits increased $155,335 from year-end 2021, while interest-bearing deposits, including savings and time deposits, increased $136,217 from December 31, 2021. Noninterest-bearing deposits acquired in the acquisition of Comunibanc Corp. totaled $65,491, while interest-bearing deposits, including savings and time deposits totaled $185,332. The increase in noninterest-bearing deposits was partially due to increases in cash balances related to the Company’s participation in a tax refund processing program, which added noninterest-bearing deposits of $60,070. In addition, demand deposit and public fund demand deposit accounts increased $19,672 and $10,212, respectively. Noninterest-bearing deposits acquired from Comunibanc Corp. totaled $65,491 at September 30, 2022. The increase in interest-bearing deposits was primarily due to increases in personal interest-bearing demand and public fund interest-bearing demand accounts of $8,044 and $11,782, respectively, accompanied by decreases in business interest-bearing demand and JUMBO NOW accounts of $30,951 and $9,523, respectively. Interest-bearing demand deposits acquired from Comunibanc Corp. totaled $41,376 at September 30, 2022. Statement savings, business money market savings and public fund money market savings accounts increased by $25,012, $5,376 and $1,669, respectively, accompanied by a decrease in brokered money market savings accounts of $16,997. Savings and money market deposits

Management’s Discussion and Analysis of Financial Condition and Results of Operations

~~Total deposits~~acquired from Comunibanc Corp. totaled $87,641 at September 30, ~~2017 increased $80,186~~2022. Time certificates over $250, time certificates and Jumbo time certificates decreased $7,767, $11,365 and $9,676, respectively. Time deposits acquired from year-end 2016. Noninterest-bearing deposits increased $11,951 from year-end 2016, while interest-bearing deposits, including savings and time deposits, increased $68,235 from December 31, 2016. The increase in noninterest-bearing deposits was primarily due to increases in public fund deposits and cash balances remaining related to the Company’s participation in a tax refund processing program. This increase is temporary as transactions are processed and is expected to return to levels more consistent with December 31, 2016 over the next quarter. The interest-bearing deposit increase was mainly due to increases in brokered deposits.Comunibanc Corp. totaled $56,315 at September 30, 2022. The year-to-date average balance of total deposits increased ~~$11,370~~$93,652, compared to the average balance offor the same period in ~~2016~~2021, mainly due to increases in the average balances of interest-bearing demand ~~deposits~~ and savings and money ~~market accounts.~~markets accounts of $47,234 and $46,890, respectively. In addition, the average balance of time deposits decreased $19,909 as compared to the same period in 2021.

FHLB advances decreased $13,277 from December 31, 2021 to September 30, 2022. The ~~increase in average balance~~decrease is due to ~~increases~~the repayment of $18,086 in demand deposit accounts, $11,867 in money market accounts, $6,332 in NOW accounts and $10,264 in statement saving accounts, offset by decreases of $18,569 in time certificates, $5,953 in CDARS deposits and $9,177 in interest-bearing public funds.

~~FHLB advances increased $8,250 from December 31, 2016 to September 30, 2017. The increase is due to an increase in overnight funds of $10,750. In addition, on January 11, 2017,~~ an FHLB advance in the amount of ~~$2,500 matured.~~$75,000. This advance had terms of one hundred ~~and~~ twenty months with a fixed rate of ~~4.25%.~~1.03% and was puttable. The advance was not replaced. Long-term advances acquired in the acquisition of Comunibanc Corp. totaled $21,706, of which $14,983 has been paid down. The Company had $55,000 in overnight funds with FHLB as of September 30, 2022.

Securities sold under agreements to repurchase, which tend to fluctuate ~~have~~based on the liquidity needs of customers and short-term nature of the instrument, decreased ~~$13,777~~$5,340 from December 31, ~~2016~~2021 to September 30, ~~2017.~~2022.

Securities purchased payable decreased $913 from December 31, 2021 to September 30, 2022. The decrease is primarily the result of a decrease in accounts payable related to securities purchased but not yet funded of $913.

Tax refunds in process increased $2,160 from December 31, 2021 to September 30, 2022. The increase is primarily the result of an increase in a clearing account related to our tax refund processing program of $2,160.

Shareholders’ equity at September 30, ~~2017~~2022 was ~~$181,981,~~$302,602, or ~~12.2%~~9.3% of total assets, compared to ~~$137,616,~~$355,212, or ~~10.0%~~11.8% of total assets, at December 31, ~~2016.~~2021. The ~~increase in the ratio of equity to total assets~~decrease was the result of ~~increases~~a decrease in ~~total assets as well as shareholders’ equity. The increase in shareholders’ equity resulted primarily from~~ the ~~completion~~fair value of securities available-for-sale, net of tax, of $78,802, dividends on common shares of $6,291 and the ~~Company’s public offering~~purchase of ~~its common stock on February 24, 2017, which resulted in net proceeds~~treasury shares of ~~$32,821. Shareholders’ equity was also positively impacted~~$16,734, offset by net income of ~~$11,892,~~$27,279 and a decrease in the Company’s pension liability, net of tax, of ~~$625, an increase in the fair value of securities available for sale, net of tax, of $1,315 and offset by dividends on preferred stock and common stock of $935 and $1,726, respectively.~~ $164.

Total outstanding common shares at September 30, ~~2017~~2022 were ~~10,170,935. Total outstanding~~15,235,545, which increased from 14,954,200 common shares outstanding at December 31, ~~2016 were 8,343,509. The increase in~~2021. Common shares outstanding increased due to the issuance of 984,723 common shares to former shareholders of Comunibanc Corp. in connection with the acquisition of Comunibanc Corp. effective July 1, 2022. Additionally, common share outstanding iswas impacted by 740,238 common shares being repurchased by the ~~result~~Company at an average repurchase price of $22.61. The Company repurchased 341,963 common shares pursuant to a ~~public offering~~stock repurchase program announced on May 4, 2022 and 392,847 common shares pursuant to a stock repurchase program announced on August 12, 2021. The repurchase program publicly announced on May 4, 2022 authorized the Company to repurchase a maximum aggregate value of ~~1,610,000 shares completed on February 24, 2017, the conversion of 1,506 shares~~$13,500 of the Company’s ~~previously issued preferred~~common shares ~~into 192,568~~until May 9, 2023. The repurchase plan publicly announced on August 12, 2021 authorized the Company to repurchase a maximum aggregate value of $13,500 of the Company’s common shares until August 10, 2022. An additional 5,428 common shares were surrendered by officers to the Company to pay taxes upon vesting of restricted shares and 2,138 restricted common shares were forfeited. The repurchase of common shares was offset by the grant of ~~17,898~~31,774 restricted common shares to certain officers under the Company’s 2014 Incentive ~~Plan, the grant of 7,171~~Plan. In addition, 7,224 common shares were issued to Civista directors ~~of the Company~~ as a retainer payment for ~~their~~ service ~~and~~on the ~~retirement~~Civista Board of ~~211 common shares on September 22, 2017.~~Directors.

The Company had net income of ~~$11,892~~$11,112 for the ~~nine~~three months ended September 30, ~~2017, a decrease~~2022, an increase of ~~$1,694~~$1,470 from net income of ~~$13,586~~$9,642 for the same ~~nine~~three months of ~~2016.~~2021. Basic earnings per common share were ~~$1.12~~$0.72 for the ~~period~~quarter ended September 30, ~~2017,~~2022, compared to ~~$1.57~~$0.64 for the same period in ~~2016.~~2021. Diluted earnings per common share were ~~$0.97~~$0.72 for the ~~period~~quarter ended September 30, ~~2017,~~2022, compared to ~~$1.24~~$0.64 for the same period in ~~2016.~~2021. The primary reasons for the changes in net income are explained below.

Net interest income for the ~~nine~~three months ended September 30, ~~2017~~2022 was ~~$39,939,~~$30,439, an increase of ~~$2,238~~$6,006 from ~~$37,701 in~~$24,433 for the same ~~nine~~three months of ~~2016. Total~~2021. This increase is the result of an increase of $6,749 in total interest income, ~~for~~offset by an increase of $743 in interest expense. Interest-earning assets averaged $3,002,256 during the ~~nine~~three months ended September 30, ~~2017 was $42,755,~~2022, an increase of ~~$2,595~~$254,806 from ~~$40,160 in~~$2,747,450 for the same ~~nine months~~period of ~~2016. Average earning assets~~2021. The Company’s average interest-bearing liabilities increased ~~5.0%~~from $1,716,512 during the ~~nine~~three months ended September 30, ~~2017 as compared~~2021 to $1,893,092 during the same period in 2016. Average loans, taxable securities, non-taxable securities and bank stocks for the first nine months of 2017 increased 7.3%, 4.4%, 14.4% and 4.2%, respectively, compared to the first nine months of last year. The increases were offset by a decrease in interest-bearing deposits in other banks. Interest-bearing deposits in other banks decreased mainly due to our tax refund processing program. The timing of cash inflows and outflows leads to large, but temporary, fluctuations in cash on deposit. The yield on the loan portfolio decreased 8 basis points for the first nine months of 2017 compared to the first nine months of last year. The yield on earning assets increased 6 basis points for the first nine months of 2017 compared to the first nine months of last year. Total interest expense for the ninethree months ended September 30, 2017 was $2,816, an increase of $357 from $2,459 in the same nine months of 2016. Interest expense on time deposits decreased $48 in the first nine months of 2017 compared to the same period in 2016. Average time deposits for the first nine months of 2017 decreased 11.9% compared to the first nine months of 2016. Interest expense on demand and savings accounts, FHLB borrowings and trust preferred securities increased $68, $222 and $116, respectively, in the first nine months of 2017 compared to the same period in 2016.2022. The interest rate paid on FHLB borrowings during the first nine months of 2017 decreased 10 basis points as compared to the same period in 2016, while the average balance increased 84.9%. The interest rate paid on trust preferred securities during the first nine months of 2017 increased 53 basis points as compared to the same period in 2016. The Company’s fully tax equivalent net interest margin for the ~~nine~~three months ended September 30, ~~2017~~2022 and 2021 was ~~3.93% compared to 3.89% for the period ended September 30, 2016.~~4.03% and 3.62%, respectively.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

Total interest income was $32,533 for the three months ended September 30, 2022, an increase of $6,749 from $25,784 of total interest income for the same period in 2021. The increase in interest income is attributable to increases in interest and fees on loans and interest income on taxable and tax-exempt securities of $4,472, $1,513, and $443, respectively. Interest on loans increased $4,472 to $27,176 for the three months ended September 30, 2022, as compared to $22,704 for the same period in 2021. The average balance of loans increased by $278,923, or 13.9% to $2,289,588 for the three months ended September 30, 2022 as compared to $2,010,665 for the same period in 2021. The loan yield increased to 4.71% for the three months ended September 30, 2022, from 4.48% for the same period in 2021.

Interest on taxable securities increased $1,513 to $2,936 for the three months ended September 30, 2022, compared to $1,423 for the same period in 2021. The average balance of taxable securities increased $89,942 to $354,597 for the three months ended September 30, 2022, as compared to $264,655 for the same period in 2021. The yield on taxable securities increased 88 basis points to 3.06% for 2022, compared to 2.18% for 2021. Interest on tax-exempt securities increased $443 to $1,998 for the three months ended September 30, 2022, compared to $1,555 for the same period in 2021. The average balance of tax-exempt securities increased $50,340 to $268,327 for the three months ended September 30, 2022, as compared to $217,987 for the same period in 2021. The yield on tax-exempt securities decreased 44 basis points to 3.47% for 2022, compared to 3.91% for 2021 due to the impact of lower interest rates in 2022 as compared to the same period of 2021.

Interest expense increased $743, or 55.0%, to $2,094 for the three months ended September 30, 2022, compared with $1,351 for the same period in 2021. The change in interest expense can be attributed to an increase in the average balance of interest-bearing liabilities, accompanied by increases in rates. For the three months ended September 30, 2022, the average balance of interest-bearing liabilities increased $176,580 to $1,893,092, as compared to $1,716,512 for the same period in 2021. Interest incurred on deposits decreased by $34 to $936 for the three months ended September 30, 2022, compared to $970 for the same period in 2021. Although the average balance of interest-bearing deposits increased by $149,936 for the three months ended September 30, 2022, as compared to the same period in 2021, deposit expense decreased due to a decrease in the rate paid on time deposits from 1.03% in 2021 to 0.79% in 2022. Interest expense incurred on FHLB advances decreased 6.7% from 2021. The average balance on FHLB balances decreased $42,951 for the three months ended September 30, 2022, as compared to the same period in 2021, as a result of the repayment of a long-term advance. Interest expense incurred on subordinated debentures increased $793, to $975 for the three months ended September 30, 2022, compared to $182 for the same period in 2021. For the three months ended September 30, 2022, the average balance of subordinated debentures increased $73,402 to $103,751, as compared to $30,349 for the same period in 2021. During the fourth quarter of 2021, the Company entered into a Subordinated Note Purchase Agreement pursuant to which the Company sold and issued $75,000 aggregate principal amount of its 3.25% Fixed-to-Floating Rate Subordinated Notes due 2031.

The following table presents the condensed average balance sheets for the ~~nine~~three months ended September 30, ~~2017~~2022 and ~~2016.~~2021. The daily average loan amounts outstanding are net of unearned income and include loans held for sale and nonaccrual loans. The average balance of securities is computed using the carrying value of securities. Rates are annualized and taxable equivalent yields are computed using a ~~35%~~21% tax rate for tax-exempt interest income. The average yield has been computed using the historical amortized cost average balance for available-for-sale securities.

	Nine Months Ended September 30,																Three Months Ended September 30,
	2017								2016								2022								2021
Assets:	Average balance			Interest		Yield/ rate*			Average balance			Interest		Yield/ rate*			Average balance			Interest		Yield/ rate*			Average balance			Interest		Yield/ rate*
Interest-earning assets:
Loans, including fees	$	1,094,401		$	37,211		4.55	%	$	1,019,793		$	35,311		4.63	%
Loans, including fees**																	$	2,289,588		$	27,176		4.71	%	$	2,010,665		$	22,704		4.48	%
Taxable securities		144,379			2,764		2.59	%		138,374			2,494		2.45	%		354,597			2,936		3.06	%		264,655			1,423		2.18	%
Tax-exempt securities		86,713			2,307		5.65	%		75,806			1,979		5.64	%		268,327			1,998		3.47	%		217,987			1,555		3.91	%
Interest-bearing deposits in other banks		78,576			473		0.80	%		103,336			376		0.49	%		89,744			423		1.87	%		254,143			102		0.16	%
Total interest-earning assets	$	1,404,069			42,755		4.20	%	$	1,337,309			40,160		4.14	%	$	3,002,256		$	32,533		4.30	%	$	2,747,450		$	25,784		3.82	%
Noninterest-earning assets:
Cash and due from financial institutions		53,487								58,864								58,581								33,803
Premises and equipment, net		18,084								16,860								28,633								22,845
Accrued interest receivable		4,446								4,262								8,907								7,417
Intangible assets		28,682								29,289								84,265								84,949
Other assets		10,164								9,986								48,013								39,111
Bank owned life insurance		24,747								23,111								53,131								46,557
Less allowance for loan losses		(13,156	)							(14,516	)							(27,546	)							(26,683	)
Total Assets	$	1,530,523							$	1,465,165							$	3,256,240							$	2,955,449
Liabilities and Shareholders Equity:
Interest-bearing liabilities:
Demand and savings	$	582,716		$	413		0.09	%	$	564,743		$	345		0.08	%	$	1,457,112		$	379		0.10	%	$	1,331,032		$	302		0.09	%
Time		181,931			1,087		0.80	%		206,620			1,135		0.73	%		280,903			557		0.79	%		257,047			668		1.03	%
FHLB		57,195			534		1.25	%		30,933			312		1.35	%
Federal funds purchased		156			2		1.71	%		155			1		0.86	%
Short-term FHLB advances																		6,713			48		2.08	%		-			—		0.00	%
Long-term FHLB advances																		25,336			133		2.84	%		75,000			194		1.03	%
Subordinated debentures		29,427			766		3.48	%		29,427			650		2.95	%		103,751			975		3.73	%		30,349			182		2.45	%
Repurchase Agreements		18,597			14		0.10	%		21,015			16		0.10	%		19,277			2		0.04	%		23,084			5		0.09	%
Total interest-bearing liabilities	$	870,022			2,816		0.43	%	$	852,893			2,459		0.39	%	$	1,893,092		$	2,094		0.44	%	$	1,716,512		$	1,351		0.31	%
Noninterest-bearing deposits		478,137								460,051								980,999								849,501
Other liabilities		12,881								20,211								77,015								40,466
Shareholders’ Equity		169,483								132,010								305,134								348,970
Total Liabilities and Shareholders’ Equity	$	1,530,523							$	1,465,165							$	3,256,240							$	2,955,449
Net interest income and interest rate spread				$	39,939		3.77	%				$	37,701		3.75	%				$	30,439		3.86	%				$	24,433		3.51	%
Net interest margin							3.93	%							3.89	%							4.03	%							3.62	%

*—~~All~~Average yields ~~and costs~~ are presented on ~~an annualized basis~~a tax equivalent basis. The tax equivalent effect associated with loans and investments, included in the yields above, was $532 and $414 for the periods ended September 30, 2022 and 2021, respectively.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

Net interest income may also be analyzed by comparing the volume and rate components of interest income and interest expense. The following table provides an analysis of the changes in interest income and expense between the ~~nine~~three months ended September 30, ~~2017~~2022 and ~~2016. The table is presented on a fully tax-equivalent basis.~~2021.

	Increase (decrease) due to:									Increase (decrease) due to:
	Volume (1)			Rate (1)			Net			Volume (1)			Rate (1)			Net
	(Dollars in thousands)									(Dollars in thousands)
Interest income:
Loans, including fees	$	2,546		$	(646	)	$	1,900		$	3,267		$	1,205		$	4,472
Taxable securities		133			137			270			819			694			1,513
Tax-exempt securities		356			(28	)		328			633			(190	)		443
Interest-bearing deposits in other banks		(106	)		203			97			(106	)		427			321
Total interest income	$	2,929		$	(334	)	$	2,595		$	4,613		$	2,136		$	6,749
Interest expense:
Demand and savings	$	11		$	57		$	68		$	30		$	47		$	77
Time		(142	)		94			(48	)		58			(169	)		(111	)
FHLB		247			(25	)		222
Federal funds purchased		—			1			1
Short-term FHLB advances											48			—			48
Long-term FHLB advances											(180	)		119			(61	)
Subordinated debentures		—			116			116			642			151			793
Repurchase agreements		(2	)		—			(2	)		(1	)		(2	)		(3	)
Total interest expense	$	114		$	243		$	357		$	597		$	146		$	743
Net interest income	$	2,815		$	(577	)	$	2,238		$	4,016		$	1,990		$	6,006

The Company provides for loan losses through regular provisions to the allowance for loan losses. ~~No provision~~Provisions for loan losses ~~was provided~~totaled $300 and $0 during the ~~nine months~~quarters ended September 30, ~~2017. During~~2022 and 2021, respectively. The increase in the ~~first nine months~~provision in the third quarter of ~~2016,~~2022 reflects the ~~Company received a payoff on a nonperforming loan. This particular~~Company’s strong loan ~~had been analyzed previously and had been charged down based on a deterioration of real estate collateral values~~growth during the ~~recent recession. As a result~~quarter. Our credit quality metrics remain stable despite the ongoing headwinds of the ~~payoff~~challenging international, national, regional and local economic conditions. While the direct impact of COVID-19 wains, we remain cautious due to increasing inflationary pressures. Criticized loans were reduced in the ~~loan,~~third quarter, primarily loans to borrowers in the ~~Company recovered~~hotel industry due to improved occupancy. Economic impacts related to the ~~charged-down amount~~COVID-19 pandemic have improved somewhat, but continued concerns linger due to the disruption of ~~approximately $1,303. The result~~supply chains, workforce shortages, rising inflationary pressures and the prospects of ~~the transaction was a reversal of $1,300 from the allowance for loan losses during the nine months of operations in 2016.~~recession.

Noninterest income for the ~~nine-month~~three-month periods ended September 30, ~~2017~~2022 and ~~2016~~2021 are as follows:

	Nine months ended September 30,					Three months ended September 30,
	2017			2016		2022			2021		$ Change			% Change
Service charges	$	3,609		$	3,714	$	1,885		$	1,519	$	366			24.1	%
Net gain on sale of securities		(9	)		20		4			4		—			0.0	%
Net gain (loss) on equity securities							(133	)		50		(183	)		-366.0	%
Net gain on sale of loans		1,207			1,341		637			1,612		(975	)		-60.5	%
ATM fees		1,643			1,584
ATM/Interchange fees							1,394			1,330		64			4.8	%
Wealth management fees		2,233			1,989		1,208			1,236		(28	)		-2.3	%
Bank owned life insurance		429			415		255			261		(6	)		-2.3	%
Tax refund processing fees		2,750			2,750
Swap fees							—			41		(41	)		-100.0	%
Other		842			1,176		484			373		111			29.8	%
Total noninterest income	$	12,704		$	12,989	$	5,734		$	6,426	$	(692	)		-10.8	%

~~Noninterest income for the nine months ended September 30, 2017 was $12,704, a decrease of $285 or 2.2% from $12,989 for the same period of 2016. The primary reasons for the decrease follow.~~

Service charge fee income for the period ended September 30, 2017 was $3,609, down $105 or 2.8% over the same period of 2016. The decrease is primarily due to decreases in business service charges and overdraft charges.

Gain on sale of loans decreased $134 during the first nine months of 2017 compared to the same period of 2016. The decrease is due to a decrease in the premium on loans sold. The decrease in the premium was offset by an increase in the volume of loans sold during the first nine months of 2017. Volume was $53,091, up $1,860 or 3.6% as compared to the same period in 2016.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

Wealth management fee income is comprised of fees earned from the management and administration of trusts and other customer assets. These fees are largely based upon the market value of the assets that we manage and the fee rate charged to customers. Wealth management fee income increased $244 or 12.3% during the first nine months of 2017 compared to the same period in 2016. The increase is mainly related to increases in assets under management and market conditions compared to the same period in 2016.

The Company processes state and federal income tax refund payments for customers of third-party income tax preparation vendors. The third-party vendors pay us a fee for processing the payments. Tax refund processing fees were $2,750 during the first nine months of 2017 and 2016. This fee income is seasonal in nature, the majority of which is received in the first quarter of the year.

Other income decreased $334 during the first nine months of 2017 compared to the same period of 2016. The decrease is mainly due to decreases in swap related income and gain/loss on sale of OREO properties during the first nine months of 2017 as compared to the same period in 2016.

Noninterest ~~expense~~income for the ~~nine-month periods ended September 30, 2017 and 2016 are as follows:~~

~~Noninterest expense for the nine~~three months ended September 30, ~~2017~~2022 was ~~$36,217, an increase~~$5,734, a decrease of ~~$3,064,~~$692, or 10.8%, from ~~$33,153 reported~~$6,426 for the same period of ~~2016.~~2021. The ~~primary reasons for~~decrease was primarily due to decreases in net gain (loss) on equity securities, net gain on sale of loans and swap fees, offset by increases in service charges and other income. Net gain (loss) on equity securities decreased as a result of market value decreases. Net gain on sale of loans decreased primarily as a result of a decrease in volume of loans sold. During the ~~increase follow.~~

~~Salaries, wages and benefits~~three-months ended September 30, 2022, 117 loans were ~~$21,684, up $2,631 or 13.8%~~sold, totaling $33,929. During the three-months ended September 30, 2021, 303 loans were sold, totaling $56,887. Swap fees decreased due to the volume of swaps performed during the quarter ended September 30, 2022 as compared to the same period of ~~2016. These~~2021. Service charges increased due to higher service charges of $196 and overdraft fees of $130. Other income increased as result of an increase in servicing fee income.

Noninterest expense for the three-month periods ended September 30, 2022 and 2021 are as follows:

Noninterest expense for the three months ended September 30, 2022 was $22,555, an increase of $3,304, or 17.2%, from $19,251 reported for the same period of 2021. The primary reasons for the increase were increases ~~are~~in compensation expense, net occupancy, equipment expense, contracted data processing expense, state franchise tax, professional services, amortization expense, software maintenance expense and other operating expense, offset by a decrease in FDIC assessment. The increase in compensation expense was mainly due to the acquisition of Comunibanc Corp. The increase in occupancy expense is due to increases in utilities and ground maintenance. Equipment expense increased due to increases in computer, security and office equipment purchases of $101. Contracted data processing fees increased due to the payment of deconversion fees related to the merger with Comunibanc Corp. of $349. The quarter-over-quarter decrease in FDIC assessments was attributable to lower assessment multipliers charged to Civista. The increase in state franchise tax expense was attributable to an increase in ~~payroll~~equity capital, which is the basis of the Ohio Financial Institutions tax. Professional services increased due to acquisition and ~~payroll~~merger related legal, accounting and tax professional fees of $430, accompanied by increases in recruitment fees and increased call volumes at the Company’s call center. The increase in amortization of intangible assets is related to the merger with Comunibanc Corp. The increase in software maintenance expense is due to a general increase in legacy software maintenance contracts and the implementation of our new digital banking. The increase in other operating expense is primarily due to merger related expenses ~~resulting from an increase in full time equivalent (FTE) employees~~of $116 and ~~annual pay increases. FTE employees increased 13.7, to 347 FTE, as compared to~~travel, lodging and meals of $64.

Income tax expense for the ~~same period of 2016. In addition, incentive based costs, higher employee insurance costs and pension costs increased, as compared to the same period of 2016.~~

~~FDIC assessments were $414, down $183 or 30.7%~~three months ended September 30, 2022 totaled $2,206, up $240 compared to the same period in ~~2016. The year-over-year decrease is the result of a new lower assessment rate schedule that became effective in 2016.~~

State franchise taxes were $767, up $58 or 8.2% compared to the same period in 2016. The year-over-year increase was attributable to an increase in the Company’s equity capital, on which the Ohio financial institutions tax is based.

Professional services costs increased $268, or 18.5% from the same period of 2016. The year-over-year increase was attributable to recruitment activities, facilities management and professional services to analyze workflow systems and recommend process improvements.

ATM costs were $700, up $321 or 84.7% compared to the same period in 2016. The increase is primarily due to vendor credits that expired in the second quarter of 2016, expenses incurred with the Company’s debit card program conversion, increased cardholder usage and ATM card related expenses.

~~Management’s Discussion and Analysis of Financial Condition and Results of Operations~~

~~Income tax expense for the nine months ended September 30, 2017 totaled $4,534, down $717 compared to the same period in 2016.~~2021. The effective tax rates for the ~~nine-month~~three-month periods ended September 30, ~~2017~~2022 and ~~September 30, 2016~~2021 were ~~27.6%~~16.7% and ~~27.9%~~16.9%, respectively. The difference between the statutory federal income tax rate and the Company’s effective tax rate is the permanent tax differences, primarily consisting of tax-exempt interest income from municipal investments and loans, low income housing tax credits and bank owned life insurance income.

The Company had net income of $3,660 for the three months ended September 30, 2017, a decrease of $20 from net income of $3,680 for the same three months of 2016. Basic earnings per common share were $0.33 for the quarter ended September 30, 2017, compared to $0.41 for the same period in 2016. Diluted earnings per common share were $0.29 for the quarter ended September 30, 2017, compared to $0.34 for the same period in 2016. The primary reasons for the changes in net income are explained below.

Net interest income for the three months ended September 30, 2017 was $13,680, an increase of $1,154 from $12,526 in the same three months of 2016. Total interest income for the three months ended September 30, 2017 was $14,836, an increase of $1,466 from $13,370 in the same three months of 2016. Average earning assets increased 8.3% during the quarter ended September 30, 2017 as compared to the same period in 2016. Average loans, taxable securities, non-taxable securities and bank stocks for the third quarter of 2017 increased 7.6%, 9.6%, 20.2% and 3.6%, respectively, compared to the third quarter of last year. The increases were partially offset by a decrease in interest-bearing deposits in other banks. The yield on the loan portfolio increased 9 basis points for the third quarter of 2017 compared to the third quarter of last year. The yield on earning assets increased 10 basis points for the third quarter of 2017 compared to the third quarter of last year. Total interest expense for the three months ended September 30, 2017 was $1,156, an increase of $312 from $844 in the same three months of 2016. Interest expense on time deposits increased $59 in the third quarter of 2017 compared to the same period in 2016. Average time deposits for the third quarter of 2017 decreased 6.5% compared to the same period in 2016. Interest expense on savings and money market accounts, FHLB borrowings and trust preferred securities increased $44, $165 and $47, respectively, in the third quarter of 2017 compared to the same period in 2016. The interest rate paid on FHLB borrowings during the third quarter of 2017 increased 4 basis points as compared to the same period in 2016, while the average balance increased 140.6%. The interest rate paid on trust preferred securities during the third quarter of 2017 increased 62 basis points as compared to the same period in 2016. The Company’s net interest margin for the three months ended September 30, 2017 and 2016 was 4.08% and 4.06%, respectively.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

The Company had net income of $27,279 for the nine months ended September 30, 2022, a decrease of $2,285 from net income of $29,564 for the same nine months of 2021. Basic earnings per common share were $1.82 for the period ended September 30, 2022, compared to $1.90 for the same period in 2021. Diluted earnings per common share were $1.82 for the period ended September 30, 2022, compared to $1.90 for the same period in 2021. The primary reasons for the changes in net income are explained below.

Net interest income for the nine months ended September 30, 2022 was $77,639, an increase of $5,537 from $72,102 in the same nine months of 2021. This increase is the result of an increase of $6,255 in total interest income, partially offset by an increase of $718 in interest expense. Interest-earning assets averaged $2,895,090 during the nine months ended September 30, 2022, an increase of $52,628 from $2,842,462 for the same period of 2021. The Company’s average interest-bearing liabilities increased from $1,724,858 for the first nine months of 2021 to $1,850,724 for the same period in 2022. The Company’s fully tax equivalent net interest margin for the nine months ended September 30, 2022 and 2021 was 3.62% and 3.48%, respectively.

Total interest income increased $6,255 to $83,263 for the period ended September 30, 2022. This change was the result of increases in the average balance of interest-earning assets, accompanied by higher yields on the portfolio. The average balance of loans increased by $66,278, or 3.2%, to $2,111,019 for the period ended September 30, 2022, as compared to $2,044,741 for the period ended September 30, 2021. The loan yield decreased to 4.44% for 2022, from 4.46% in 2021.

Interest on taxable securities increased $2,503 to $6,431 for the period ended September 30, 2022, compared to $3,928 for the same period in 2021. The average balance of taxable securities increased $107,283 to $322,262 for the period ended September 30, 2022, as compared to $214,979 for the period ended September 30, 2021. The yield on taxable securities increased 2 basis points to 2.53% for 2022, compared to 2.51% for 2021. Interest on tax-exempt securities increased $1,070 to $5,669 for the period ended September 30, 2022, compared to $4,599 for the same period in 2021. The average balance of tax-exempt securities increased $51,252 to $262,790 for the period ended September 30, 2022, as compared to $211,538 for the period ended September 30, 2021. The yield on tax-exempt securities decreased 47 basis points to 3.55% for 2022, compared to 4.02% for 2021.

Interest on interest-bearing deposits in other banks increased $757 to $1,098 for the period ended September 30, 2022, compared to $341 for the same period in 2021. The average balance of interest-bearing deposits in other banks decreased $172,185 to $199,019 for the period ended September 30, 2022, as compared to $371,204 for the period ended September 30, 2021. The yield on interest-bearing deposits in other banks increased 62 basis points to 0.74% for 2022, compared to 0.12% for 2021.

Interest expense increased $718, or 14.6%, to $5,624 for the period ended September 30, 2022, compared with $4,906 for the same period in 2021. The change in interest expense can be attributed to an increase in rate, accompanied by an increase in the average balance of interest-bearing liabilities. For the period ended September 30, 2022, the average balance of interest-bearing liabilities increased $125,866 to $1,850,724, as compared to $1,724,858 for the period ended September 30, 2021. Interest incurred on deposits decreased by $1,015 to $2,351 for the period ended September 30, 2022, compared to $3,366 for the same period in 2021. Although the average balance of interest-bearing deposits increased by $97,088 for the period ended September 30, 2022, as compared to the same period in 2021, deposit expense decreased due to a decrease in the rate paid on demand and savings accounts from 0.10% in 2021 to 0.08% in 2022. The rate paid on time deposits decreased from 1.18% in 2021 to 0.80% in 2022. Interest expense incurred on FHLB advances and subordinated debentures increased 114.7% from 2021. The average balance on FHLB balances decreased $39,815 as a result of the repayment of a long-term advance for the period ended September 30, 2022, as compared to the same period in 2021, while the rate paid decreased 11 basis points. In addition, the average balance of subordinated debentures increased $73,377 to $103,726, as compared to $30,349 for the same period in 2021. During the fourth quarter of 2021, the Company entered into a Subordinated Note Purchase Agreement pursuant to which the Company sold and issued $75,000 aggregate principal amount of its 3.25% Fixed-to-Floating Rate Subordinated Notes due 2031. The rate paid on subordinated debentures increased 97 basis points for the period ended September 30, 2022, as compared to the same period in 2021.

The following table presents the condensed average balance sheets for the ~~three~~nine months ended September 30, ~~2017~~2022 and ~~2016.~~2021. The daily average loan amounts outstanding are net of unearned income and include loans held for sale and nonaccrual loans. The average balance of securities is computed using the carrying value of securities. Rates are annualized and taxable equivalent yields are computed using a ~~35%~~21% tax rate for tax-exempt interest income. The average yield has been computed using the historical amortized cost average balance for available-for-sale securities.

	Three Months Ended September 30,																Nine Months Ended September 30,
	2017								2016								2022								2021
Assets:	Average balance			Interest		Yield/rate*			Average balance			Interest		Yield/rate*			Average balance			Interest		Yield/ rate*			Average balance			Interest		Yield/ rate*
Interest-earning assets:
Loans, including fees	$	1,122,131		$	13,022		4.60	%	$	1,042,721		$	11,824		4.51	%
Loans, including fees**																	$	2,111,019		$	70,065		4.44	%	$	2,044,741		$	68,140		4.46	%
Taxable securities		150,534			977		2.61	%		138,092			872		2.56	%		322,262			6,431		2.53	%		214,979			3,928		2.51	%
Tax-exempt securities		93,022			812		5.53	%		77,378			664		5.56	%		262,790			5,669		3.55	%		211,538			4,599		4.02	%
Interest-bearing deposits in other banks		11,450			25		0.87	%		12,878			10		0.31	%		199,019			1,098		0.74	%		371,204			341		0.12	%
Total interest-earning assets	$	1,377,137			14,836		4.42	%	$	1,271,069			13,370		4.32	%	$	2,895,090		$	83,263		3.88	%	$	2,842,462		$	77,008		3.71	%
Noninterest-earning assets:
Cash and due from financial institutions		24,652								24,591								108,220								37,763
Premises and equipment, net		18,000								16,975								24,429								22,578
Accrued interest receivable		4,460								4,134								8,025								8,146
Intangible assets		28,541								29,136								84,268								84,817
Other assets		10,352								10,196								44,077								38,426
Bank owned life insurance		24,889								24,308								48,965								46,310
Less allowance for loan losses		(12,988	)							(14,424	)							(27,168	)							(26,288	)
Total Assets	$	1,475,043							$	1,365,985							$	3,185,906							$	3,054,214
Liabilities and Shareholders Equity:
Interest-bearing liabilities:
Demand and savings	$	594,088		$	160		0.11	%	$	574,322		$	118		0.08	%	$	1,414,215		$	860		0.08	%	$	1,297,217		$	979		0.10	%
Time		194,364			447		0.91	%		207,947			388		0.74	%		250,230			1,491		0.80	%		270,139			2,387		1.18	%
FHLB		85,840			276		1.28	%		35,673			111		1.24	%
Federal funds purchased		462			2		1.72	%		462			1		0.86	%
Short-term FHLB advance																		2,380			49		2.75	%		—			—		—
Long-term FHLB advance																		58,263			515		1.18	%		100,458			968		1.29	%
Subordinated debentures		29,427			268		3.61	%		29,427			221		2.99	%		103,726			2,701		3.48	%		30,349			553		2.51	%
Repurchase Agreements		14,328			3		0.08	%		18,827			5		0.11	%		21,910			8		0.05	%		26,695			19		0.10	%
Total interest-bearing liabilities	$	918,509			1,156		0.50	%	$	866,658			844		0.39	%	$	1,850,724		$	5,624		0.41	%	$	1,724,858		$	4,906		0.38	%
Noninterest-bearing deposits		363,783								347,912								936,686								940,123
Other liabilities		12,826								14,678								76,748								39,952
Shareholders’ Equity		179,925								136,737								321,748								349,281
Total Liabilities and Shareholders’ Equity	$	1,475,043							$	1,365,985							$	3,185,906							$	3,054,214
Net interest income and interest rate spread				$	13,680		3.91	%				$	12,526		3.93	%				$	77,639		3.47	%				$	72,102		3.33	%
Net interest margin							4.08	%							4.06	%							3.62	%							3.48	%

*—~~All~~Average yields ~~and costs~~ are presented on ~~an annualized basis~~a tax equivalent basis. The tax equivalent effect associated with loans and investments, included in the yields above, was $1,508 and $1,228 for the periods ended September 30, 2022 and 2021, respectively.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

Net interest income may also be analyzed by comparing the volume and rate components of interest income and interest expense. The following table provides an analysis of the changes in interest income and expense between the ~~three~~nine months ended September 30, ~~2017~~2022 and ~~2016.~~2021. The table is presented on a fully tax-equivalent basis.

	Increase (decrease) due to:									Increase (decrease) due to:
	Volume (1)			Rate (1)			Net			Volume (1)			Rate (1)			Net
	(Dollars in thousands)									(Dollars in thousands)
Interest income:
Loans, including fees	$	917		$	281		$	1,198		$	2,201		$	(276	)	$	1,925
Taxable securities		88			17			105			2,470			33			2,503
Tax-exempt securities		160			(12	)		148			1,657			(587	)		1,070
Interest-bearing deposits in other banks		(1	)		16			15			(225	)		982			757
Total interest income	$	1,164		$	302		$	1,466		$	6,103		$	152		$	6,255
Interest expense:
Demand and savings	$	4		$	38		$	42		$	83		$	(202	)	$	(119	)
Time		(27	)		86			59			(165	)		(731	)		(896	)
FHLB		161			4			165
Federal funds purchased		—			1			1
Short-term FHLB advance											49			—			49
Long-term FHLB advance											(378	)		(75	)		(453	)
Subordinated debentures		—			47			47			1,824			324			2,148
Repurchase agreements		(1	)		(1	)		(2	)		(3	)		(8	)		(11	)
Total interest expense	$	137		$	175		$	312		$	1,410		$	(692	)	$	718
Net interest income	$	1,027		$	127		$	1,154		$	4,693		$	844		$	5,537

The Company provides for loan losses through regular provisions to the allowance for loan losses. ~~During~~Provisions for loan losses totaled $1,000 and $830 during the ~~quarters~~periods ended September 30, ~~2017~~2022 and ~~September 30, 2016, no~~2021, respectively. The increase in provision ~~for~~was due to the strong loan ~~losses was provided.~~growth during the first nine months of 2022. The challenges of the international, national, regional and local economic conditions, particularly inflation, has taken greater focus from the prior economic shutdown and restrictions in response to the ongoing COVID-19 pandemic. Despite these concerns, our portfolio quality has remained stable overall with decreases in criticized loans. We continue to be optimistic that asset quality will continue to remain strong despite ongoing headwinds. While we remain cautious given the impact of inflation on all of our borrowers, we are encouraged by strong loan growth.

Noninterest income for the ~~three-month~~nine-month periods ended September 30, ~~2017~~2022 and ~~2016~~2021 are as follows:

	Three months ended September 30,					Nine months ended September 30,
	2017			2016		2022			2021		$ Change			% Change
Service charges	$	1,177		$	1,194	$	5,004		$	4,092	$	912			22.3	%
Net gain on sale of securities		(9	)		18		10			1,787		(1,777	)		-99.4	%
Net gain (loss) on equity securities							(44	)		191		(235	)		-123.0	%
Net gain on sale of loans		472			541		2,146			6,575		(4,429	)		-67.4	%
ATM fees		567			541
ATM/Interchange fees							3,990			3,950		40			1.0	%
Wealth management fees		787			688		3,713			3,570		143			4.0	%
Bank owned life insurance		142			149		732			752		(20	)		-2.7	%
Tax refund processing fees							2,375			2,375		—			0.0	%
Swap fees							—			135		(135	)		-100.0	%
Other		329			522		1,086			1,214		(128	)		-10.5	%
Total noninterest income	$	3,465		$	3,653	$	19,012		$	24,641	$	(5,629	)		-22.8	%

Noninterest income for the ~~three~~nine months ended September 30, ~~2017~~2022 was ~~$3,465,~~$19,012, a decrease of ~~$188~~$5,629, or ~~5.1%~~22.8%, from ~~$3,653~~$24,641 for the same period of ~~2016.~~2021. The decrease was primary ~~reasons for~~due to decreases in net gain on the ~~increase follow.~~

~~Gain~~sale of securities of $1,777, net gain (loss) on equity securities of $235, net gain on sale of loans ~~decreased $69 or 12.8% during the third quarter~~ of ~~2017 compared to the same period~~$4,429, swap fees of ~~2016. The decrease is due to a decrease in the premium on loans sold. The decrease in the premium~~$135 and other income of $1289, which was offset by an increase in ~~the volume~~service charges of ~~loans sold during the third quarter~~$912. Net gain on sale of ~~2017. Volume was $22,153, up $629 or 2.9% as compared~~securities decreased due to the ~~same period~~sale of Visa Class B shares in ~~2016.~~ 2021. Net gain (loss) on equity securities decreased as a result of market value decreases. Net gain on sale of

Management’s Discussion and Analysis of Financial Condition and Results of Operations

~~Wealth management fee income is comprised~~loans decreased primarily as a result of ~~fees earned from~~a decrease in volume of loans sold. During the management and administration of trusts and other customer assets. These fees are largely based upon the market value of the assets that we manage and the fee rate charged to customers. Wealth management fee income increased $99 or 14.4% during the third quarter of 2017 compared to the same period in 2016. The increase is mainly related to increases in assets under management and market conditions compared to the same period in 2016.

Other income decreased $193 during the third quarter of 2017 compared to the same period of 2016. The decrease is mainly due to decreases in swap related income and gain/loss on sale of OREO properties during the third quarter of 2017 as compared to the same period in 2016.

~~Noninterest expense for the three-month periods~~nine-months ended September 30, ~~2017 and 2016 are as follows:~~

~~Noninterest expense for~~2022, 571 loans were sold, totaling $107,587. During the ~~three months~~nine-months ended September 30, ~~2017 was $12,167, an increase~~2021, 1,055 loans were sold, totaling $204,728. Swap fees decreased due to the volume of ~~$972, or 8.7%, from $11,195 reported for~~swaps performed during the ~~same period of 2016. The primary reasons for the increase follow.~~

~~Salaries, wages and benefits were $7,389, up $1,014 or 15.9%~~nine-months ended September 30, 2022, as compared to the same period of ~~2016. These increases are mainly~~2021. Other income decreased as result of an increase in insurance loss reserves from the Company’s reinsurance subsidiary. Service charges increased due to an increase in service charges and overdraft fees of $336 and $576, respectively.

Tax refund processing fees were $2,375 for each of the nine months ended September 30, 2022 and 2021. These fees are received for processing state and federal income tax refund payments for customers of third-party income tax preparation vendors. This fee income is seasonal in nature, the majority of which is earned in the first quarter of the year.

Noninterest expense for the nine-month periods ended September 30, 2022 and 2021 are as follows:

Noninterest expense for the nine months ended September 30, 2022 was $63,192, an increase of $2,490, or 4.1%, from $60,702 reported for the same period of 2021. The primary reasons for the increase were increases in compensation expenses of $2,076, equipment expense of $354, contracted data processing of $537, state franchise tax of $241, professional services of $1,338, amortization of intangible assets of $222 and software maintenance expense of $568, offset by decreases in FDIC assessments of $261, ATM/Interchange expense of $184 and other operating expenses of $2,682. The increase in compensation expense was due to increased payroll, 401k expenses, payroll taxes and commission and incentive based costs and the acquisition by merger of Comunibanc Corp. Payroll and payroll related expenses increased due to annual pay increases. Equipment expense increased due to an increase in ~~full time equivalent (FTE) employees~~computer and ~~annual pay increases. FTE employees~~security equipment purchases of $202 and reimbursement of COVID-19 expenses of $12 in 2021. Contracted data processing fees increased ~~14.6,~~due to ~~353.7 FTE,~~merger related system deconversion fees of $564, offset by a decrease in computer processing fees. The decrease in FDIC assessments was attributable to lower assessment multipliers charged to Civista. The increase in state franchise tax expense was attributable to an increase in equity capital, which is the basis of the Ohio Financial Institutions tax, offset by the payment of $172 of additional taxes in 2021 as ~~compared~~a result of findings from a State of Ohio audit. Professional services increased due to merger related legal, accounting and tax professional fees, accompanied by increases in recruitment fees and increased call volumes at the Company’s call center. The decrease in ATM/Interchange expense is the result of a decrease in billings from Mastercard in 2022 and lower processing fees. The increase in software maintenance expense is due to a general increase in legacy software maintenance contracts and the implementation of our new digital banking. The decrease in other operating expense is primarily due to the ~~same period~~prepayment expense of ~~2016. In addition, incentive based costs, employee insurance costs and pension costs increased, as compared~~$3,717 related to the ~~same period~~early payoff of ~~2016.~~an FHLB long-term advance, offset by a credit to the valuation adjustment for mortgage servicing rights and increases in travel, lodging and meals, stationery and supplies and bad check expense.

Income tax expense for the nine months ended September 30, 2022 totaled $5,180, down ~~$144 or 29.1%~~$467 compared to the same period in ~~2016. The quarter-over-quarter increase was attributable to lower repair and maintenance expense during the third quarter of 2017 as compared to the same period.~~

FDIC assessments were $115, down $51 or 30.7% compared to the same period in 2016. The quarter-over-quarter decrease is the result of a new lower assessment rate schedule that became effective in 2016.

Professional services costs increased $103, or 23.9% from the same period of 2016. The quarter-over-quarter increase was attributable to recruitment activities, facilities management and professional services to analyze workflow systems and recommend process improvements.

~~ATM costs were $233, up $50 or 27.3% compared to the same period in 2016. The increase is primarily due to increases in cardholder usage and ATM card expenses during the third quarter of 2017.~~

~~Income tax expense for the three months ended September 30, 2017 totaled $1,318, up $14 compared to the same period in 2016.~~2021. The effective tax rates for the ~~three-month~~nine-month periods ended September 30, ~~2017~~2022 and ~~September 30, 2016~~2021 were ~~26.5%~~16.0% and ~~26.2%~~16.0%, respectively. The difference between the statutory federal income tax rate and the Company’s effective tax rate is the permanent tax differences, primarily consisting of tax-exempt interest income from municipal investments and loans, low income housing tax credits and bank owned life insurance income.

Shareholders’ equity totaled $181,981 at September 30, 2017 compared to $137,616 at December 31, 2016. The increase in shareholders’ equity resulted primarily from the completion of the Company’s public offering of its common stock on February 24, 2017, which resulted in net proceeds of $32,821. Shareholders’ equity was also positively impacted by net income of $11,892, a $625 net decrease in the Company’s pension

Management’s Discussion and Analysis of Financial Condition and Results of Operations

Shareholders’ equity totaled $302,602 at September 30, 2022, compared to $355,212 at December 31, 2021. Shareholders’ equity decreased during the first nine months of 2022 as a result of a decrease in ~~the~~ fair value of securities ~~available for sale,~~available-for-sale, net of tax, of ~~$1,315, which was offset by~~$78,802, dividends on ~~preferred stock and~~ common stock of ~~$935~~$6,291 and ~~$1,726, respectively.~~the Company’s repurchase of common shares during the period, which totaled $16,734, offset by net income of $27,279 and a $164 net decrease in the Company’s pension liability.

All of the Company’s capital ratios exceeded the regulatory minimum guidelines as of September 30, ~~2017~~2022 and December 31, ~~2016~~2021 as identified in the following table:

	Total Risk Based Capital			Tier I Risk Based Capital			CET1 Risk Based Capital			Leverage Ratio			Total Risk Based Capital			Tier I Risk Based Capital			CET1 Risk Based Capital			Leverage Ratio
Company Ratios—September 30, 2017		16.6	%		15.5	%		11.6	%		12.7	%
Company Ratios—December 31, 2016		14.2	%		13.0	%		8.6	%		10.6	%
Company Ratios—September 30, 2022														15.6	%		11.6	%		10.5	%		9.3	%
Company Ratios—December 31, 2021														19.2	%		14.3	%		12.9	%		10.2	%
For Capital Adequacy Purposes		8.0	%		6.0	%		4.5	%		4.0	%		8.0	%		6.0	%		4.5	%		4.0	%
To Be Well Capitalized Under Prompt
Corrective Action Provisions		10.0	%		8.0	%		6.5	%		5.0	%		10.0	%		8.0	%		6.5	%		5.0	%

The Company paid a cash dividend of $0.06 per common share on February 1, 2017, on May 1, 2017 and on August 1, 2017. In 2016, the Company paid a cash dividend of $0.05 per common share on February 1, 2016 and on May 1, 2016 and paid a cash dividend of $0.06 per common share on August 1, 2016. The Company also paid a 6.50% cash dividend on its Series B preferred shares in the amount of approximately $319 on March 15, 2017 and approximately $308 on June 15, 2017 and on September 15, 2017. In 2016, the Company paid a 6.50% cash dividend on its Series B preferred shares in the amount of approximately $391 on March 15, 2016 and on June 15, 2016 and approximately $374 on September 15, 2016.

The Company maintains a conservative liquidity position. All securities, with the exception of equity securities, are classified as ~~available for sale.~~available-for-sale. Securities, with maturities of one year or less, totaled ~~$5,108,~~$1,490, or ~~2.2%~~0.3% of the total security portfolio at September 30, ~~2017.~~2022. The ~~available for sale~~available-for-sale portfolio helps to provide the Company with the ability to meet its funding needs. The Condensed Consolidated Statements of Cash Flows (Unaudited) contained in the ~~consolidated financial statements~~Consolidated Financial Statements detail the Company’s cash flows from operating activities resulting from net earnings.

As reported in the Condensed Consolidated Statements of Cash Flows (Unaudited), our cash flows are classified for financial reporting purposes as operating, investing or financing cash flows. Net cash provided by operating activities was ~~$11,821~~$27,421 and ~~$11,318~~$34,295 for the nine months ended September 30, ~~2017~~2022 and ~~2016,~~2021, respectively. ~~These amounts differ~~The primary additions to cash from ~~net income due to a variety~~operating activities are from proceeds from the sale of loans. The primary use of cash ~~receipts and disbursements that did not affect net income~~from operating activities is from loans originated for ~~the respective periods.~~sale. Net cash used ~~for~~by investing activities was ~~$119,937~~$207,756 and ~~$53,828~~$83,948 for the nine months ended September 30, ~~2017~~2022 and ~~2016,~~2021, respectively, principally reflecting our loan and investment security activities. Cash provided by and used for deposits ~~borrowings~~ and ~~net proceeds from our common equity offering~~purchase of treasury shares comprised most of our financing activities, which resulted in net cash provided by of ~~$104,815~~$42,990 and ~~$40,178~~$163,296 for the nine months ended September 30, ~~2017~~2022 and ~~2016,~~2021, respectively.

Future loan demand of Civista may be funded by increases in deposit accounts, proceeds from payments on existing loans, the maturity of securities, and the sale of securities classified as ~~available for sale.~~available-for-sale. Additional sources of funds may also come from borrowing in the Federal Funds market and/or borrowing from the FHLB. Through its correspondent banks, Civista maintains federal funds borrowing lines totaling ~~$42,500.~~$50,000. As of September 30, ~~2017,~~2022, Civista had total credit availability with the FHLB of ~~$355,367~~$753,521 with standby letters of credit totaling ~~$19,600~~$110,900 and a remaining borrowing capacity of approximately ~~$279,017.~~$580,827. In addition, ~~Civista Bancshares, Inc.~~CBI maintains a credit line with a third party lender totaling ~~$7,500.~~$10,000. No borrowings were outstanding by CBI under this credit line as of September 30, 2022.

The Company’s primary market risk exposure is interest-rate risk and, to a lesser extent, liquidity risk. All of the Company’s transactions are denominated in U.S. dollars with no specific foreign exchange exposure.

Interest-rate risk is the exposure of a banking organization’s financial condition to adverse movements in interest rates. Accepting this risk can be an important source of profitability and shareholder value. However, excessive levels of interest-rate risk can pose a significant threat to the Company’s earnings and capital base. Accordingly, effective risk management that maintains interest-rate risk at prudent levels is essential to the Company’s safety and soundness.

Evaluating a financial institution’s exposure to changes in interest rates includes assessing both the adequacy of the management process used to control interest-rate risk and the organization’s quantitative level of exposure. When assessing the interest-rate risk management process, the Company seeks to ensure that appropriate policies, procedures, management information systems and internal controls are in place to maintain interest-rate risk at prudent levels with consistency and continuity. Evaluating the quantitative level of interest rate risk exposure requires the Company to assess the existing and potential future effects of changes in interest rates on its consolidated financial condition, including capital adequacy, earnings, liquidity and, where appropriate, asset quality.

The Federal Reserve Board, together with the Office of the Comptroller of the Currency and the Federal Deposit Insurance ~~Company, adopted a Joint Agency Policy Statement on interest-rate risk, effective June 26, 1996. The~~Corporation, issue policy ~~statement provides~~statements and guidance ~~to examiners and bankers~~ on sound practices for managing interest-rate risk, which ~~will~~ form the basis for ongoing evaluation of the adequacy of interest-rate risk management at supervised institutions. The ~~policy statement~~guidance also outlines fundamental elements of sound management ~~that have been identified in prior Federal Reserve guidance~~ and discusses the importance of these elements in the context of managing interest-rate risk. ~~Specifically, the~~The guidance emphasizes the need for active board of director and senior management oversight and a comprehensive risk-management process that effectively identifies, measures, and controls interest-rate risk.

Financial institutions derive their income primarily from the excess of interest collected over interest paid. The rates of interest an institution earns on its assets and owes on its liabilities generally are established contractually for a period of time. Since market interest rates change over time, an institution is exposed to lower profit margins (or losses) if it cannot adapt to interest-rate changes. For example, assume that an institution’s assets carry intermediate- or long-term fixed rates and that those assets were funded with short-term liabilities. If market interest rates rise by the time the short-term liabilities must be refinanced, the increase in the institution’s interest expense on its liabilities may not be sufficiently offset if assets continue to earn at the long-term fixed rates. Accordingly, an institution’s profits could decrease on existing assets because the institution will have either lower net interest income or, possibly, net interest expense. Similar risks exist when assets are subject to contractual interest-rate ceilings, or rate sensitive assets are funded by longer-term, fixed-rate liabilities in a decreasing-rate environment.

Several techniques may be used by an institution to minimize interest-rate risk. One approach used by the Company is to periodically analyze its assets and liabilities and make future financing and investment decisions based on payment streams, interest rates, contractual maturities, and estimated sensitivity to actual or potential changes in market interest rates. Such activities fall under the broad definition of asset/liability management. The Company’s primary asset/liability management technique is the measurement of the Company’s asset/liability gap, that is, the difference between the cash flow amounts of interest sensitive assets and liabilities that will be refinanced (or repriced) during a given period. For example, if the asset amount to be repriced exceeds the corresponding liability amount for a certain day, month, year, or longer period, the institution is in an asset sensitive gap position. In this situation, net interest income would increase if market interest rates rose or decrease if market interest rates fell. If, alternatively, more liabilities than assets will reprice, the institution is in a liability sensitive position. Accordingly, net interest income would decline when rates rose and increase when rates fell. Also, these examples assume that interest rate changes for assets and liabilities are of the same magnitude, whereas actual interest rate changes generally differ in magnitude for assets and liabilities.

Several ways an institution can manage interest-rate risk include selling existing assets or repaying certain liabilities; matching repricing periods for new assets and liabilities, for example, by shortening terms of new loans or securities; and hedging existing assets, liabilities, or anticipated transactions. An institution might also invest in more complex financial instruments intended to hedge or otherwise change interest-rate risk. Interest rate swaps, futures contracts, options on futures, and other such derivative financial instruments often are used for this purpose. Because these instruments are sensitive to interest rate changes, they require management expertise to be effective. The Company has not purchased derivative financial instruments to hedge interest rate risk in the past and does not currently intend to purchase such instruments in the near future. Financial institutions are also subject to prepayment risk in falling rate environments. For example, mortgage loans and other financial assets may be prepaid by a debtor so that the debtor may refinance its obligations at new, lower rates. Prepayments of assets carrying higher rates reduce the Company’s interest income and overall asset yields. A large portion of an institution’s liabilities may be short-term or due on demand, while most of its assets may be invested in long-term loans or securities. Accordingly, the Company seeks to have in place sources of cash to meet short-term demands. These funds can be obtained by increasing deposits, borrowing, or selling assets. FHLB advances and wholesale borrowings may also be used as important sources of liquidity for the Company.

The following table provides information about the Company’s financial instruments that were sensitive to changes in interest rates as of December 31, ~~2016~~2021 and September 30, ~~2017,~~2022, based on certain prepayment and account decay assumptions that management believes are reasonable. The table shows the changes in the Company’s net portfolio value (in amount and percent) that would result from hypothetical interest rate increases of 200 basis points and 100 basis points and an interest rate ~~decrease~~decreases of 100 basis points and 200 basis points at September 30, ~~2017~~2022 and December 31, ~~2016.~~2021.

The Company had derivative financial instruments as of December 31, ~~2016~~2021 and September 30, ~~2017.~~2022. The changes in fair value of the assets and liabilities of the underlying contracts offset each other. Expected maturity date values for interest-bearing core deposits were calculated based on estimates of the period over which the deposits would be outstanding. The Company’s borrowings were tabulated by contractual maturity dates and without regard to any conversion or repricing dates.

Net Portfolio Value	Net Portfolio Value																	Net Portfolio Value
		September 30, 2017								December 31, 2016									September 30, 2022								December 31, 2021
Change in Rates		Dollar Amount		Dollar Change			Percent Change			Dollar Amount		Dollar Change			Percent Change				Dollar Amount		Dollar Change			Percent Change			Dollar Amount		Dollar Change		Percent Change
+200bp			257,937		34,479			15	%		229,366		31,559			16	%			536,144		27,071			5	%		531,385		44,276		9	%
+100bp			246,494		23,036			10	%		219,008		21,201			11	%			525,656		16,583			3	%		521,707		34,598		7	%
Base			223,458		—			—			197,807		—			—				509,073		—			—			487,109		—		—
-100bp			221,782		(1,676	)		-1	%		186,624		(11,183	)		-6	%			498,583		(10,490	)		(2	)%		495,963		8,854		2	%
-200bp																				483,999		(25,074	)		(5	)%		548,326		61,217		13	%

The change in net portfolio value from December 31, ~~2016~~2021 to September 30, ~~2017,~~2022, can be attributed to ~~two~~a couple of factors. ~~While the~~The yield curve has ~~flattened from~~risen and inverted compared to the end of the year, and both the volume and mix of assets and funding sources has changed. ~~Cash, as it relates to the tax refund processing program,~~The volume of cash has decreased, ~~while~~and the ~~volume~~mix has shifted toward loans. While the loan portfolio increased due to growth and acquisition, the market value of loans ~~and securities have both increased. This change in~~has decreased due to market rate increases. The volume non-maturing deposits has increased due to acquisition, but the ~~mix of assets tends to increase volatility.~~market value has decreased. The ~~funding~~ volume and mix ~~has shifted~~shifts from ~~borrowed money~~the end of the year, along with market rate changes, contributed to ~~deposits and CDs,~~a small decrease in the base net portfolio value, which ~~tends to increase volatility. The increased volume of loans and securities led to~~partially offset the increase ~~in the base.~~due to acquisition. Beyond the change in the base level of net portfolio value, projected movements in rates, up or down, would also lead to changes in market values. The change in the rates up scenarios for both the 100 and 200 basis point movements would lead to a ~~faster~~larger decrease in the ~~fair~~market value of liabilities ~~compared to~~than assets. Accordingly, we ~~would~~ see an increase in the net portfolio value. ~~However, a downward~~The change in the rates down scenario for both the 100 and 200 basis point movements would lead to a larger increase in the market value of liabilities than assets, leading to a decrease in the net portfolio ~~value as the fair value of liabilities would increase more quickly than the fair value of assets.~~

Under the supervision and with the participation of our management, including our principal executive and our principal financial officers, we evaluated the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), as of the end of the period covered by this Quarterly Report on Form 10-Q. Based upon that evaluation, our principal executive and our principal financial officers concluded that our disclosure controls and procedures as of September 30, ~~2017,~~2022, were effective.

There have not been any changes in the Company’s internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) that occurred during the Company’s most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

In the ordinary course of their respective businesses, CBI or Civista or their respective properties may be named or otherwise subject as a plaintiff, defendant or other party to various pending and threatened legal proceedings and various actual and potential claims. In view of the inherent difficulty of predicting the outcome of such matters, the Company cannot state what the eventual outcome of any such matters will be. However, based on current knowledge and after consultation with legal counsel, management believes these proceedings will not have a material adverse effect on the consolidated financial position, results of operations or ~~material changes to existing legal proceedings during the current period.~~liquidity of CBI or Civista.

There were no material changes during the current period to the risk factors disclosed in “Item 1A. Risk Factors” of Part I of the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, ~~2016.~~2021.

~~None~~During the third quarter of 2022, the Company purchased common shares as follows:

On May 4, 2022, the Company announced a new common share repurchase program to replace its previous repurchase program. The new repurchase program authorizes the Company to repurchase a maximum aggregate value of $13,500,000 of its outstanding common shares through May 9, 2023. As of September 30, 2022 a total of 341,963 common shares had been repurchased for an aggregate purchase price of $7,291,893 under this repurchase program.

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Ohio		34-1558688
(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification No.)

100 East Water Street, Sandusky, Ohio		44870
(Address of principal executive offices)		(Zip Code)

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common		CIVB		NASDAQ Capital Market

Large accelerated filer	☐		Accelerated filer	☒
Non-accelerated filer	☐	~~(Do not check if a smaller reporting company)~~	Smaller reporting company	☐
Emerging growth company	☐

PART I.	Financial Information	2
Item 1.	Financial Statements:
	~~Consolidated Balance Sheets (Unaudited) September 30, 2017 and December 31, 2016~~	2
	Consolidated Balance Sheets (Unaudited) September 30, 2022 and December 31, 2021	2
	Consolidated Statements of Operations (Unaudited) ~~Three~~Three- and ~~nine months~~nine-months ended September 30, ~~2017~~2022 and ~~2016~~2021	3
	Consolidated Statements of Comprehensive Income (Loss) (Unaudited) ~~Three~~ Three- and ~~nine months~~nine-months ended September 30, ~~2017~~2022 and ~~2016~~2021	4
	~~Condensed~~ Consolidated Statement of Changes in Shareholders’ Equity (Unaudited) ~~Nine months~~Three- and nine-months ended September 30, ~~2017~~2022 and 2021	5
	Condensed Consolidated Statements of Cash Flows (Unaudited) Nine months ended September 30, ~~2017~~2022 and ~~2016~~2021	67
	Notes to Interim Consolidated Financial Statements (Unaudited)	~~7-33~~8-39
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	~~34-44~~40-53
Item 3.	Quantitative and Qualitative Disclosures ~~about~~About Market Risk	~~45-46~~54-55
Item 4.	Controls and Procedures	4756

PART II.	Other Information	57
Item 1.	Legal Proceedings	4857
Item 1A.	Risk Factors	4857
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	4857
Item 3.	Defaults ~~upon~~Upon Senior Securities	4857
Item 4.	Mine Safety Disclosures	4857
Item 5.	Other Information	4857
Item 6.	Exhibits	4858
Signatures		4959

December 31, 2021	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
U.S. Treasury securities and obligations of U.S. government agencies	$	48,390	$	30	$	(530	)	$	47,890
Obligations of states and political subdivisions		281,247		17,696		(107	)		298,836
Mortgage-backed securities in government sponsored entities		211,660		2,938		(1,450	)		213,148
Total debt securities	$	541,297	$	20,664	$	(2,087	)	$	559,874

	Preferred Shares						Common Shares												Accumulated Other			Total
	Outstanding Shares			Amount			Outstanding Shares			Amount			Retained Earnings			Treasury Shares			Comprehensive Loss			Shareholders’ Equity
Balance, December 31, 2016		20,481		$	18,950			8,343,509		$	118,975		$	19,263		$	(17,235	)	$	(2,337	)	$	137,616
Net Income		—			—			—			—			11,892			—			—			11,892
Other comprehensive income		—			—			—			—			—			—			1,940			1,940
Conversion of Series B preferred shares to common shares		(1,506	)		(1,393	)		192,568			1,393			—			—			—			—
Common stock issuance, net of costs		—			—			1,610,000			32,821			—			—			—			32,821
Stock-based compensation		—			—			25,069			377			—			—			—			377
Common stock dividends ($0.18 per share)		—			—			—			—			(1,726	)		—			—			(1,726	)
Preferred stock dividend		—			—			—			—			(935	)		—			—			(935	)
Retirement of common stock								(211	)		(4	)											(4	)
Balance, September 30, 2017		18,975		$	17,557			10,170,935		$	153,562		$	28,494		$	(17,235	)	$	(397	)	$	181,981

	September 30, 2017			December 31, 2016
Commercial and agriculture	$	147,537		$	135,462
Commercial real estate- owner occupied		167,678			161,364
Commercial real estate- non-owner occupied		424,430			395,931
Residential real estate		267,839			247,308
Real estate construction		77,978			56,293
Farm Real Estate		38,966			41,170
Consumer and other		17,564			17,978
Total loans		1,141,992			1,055,506
Allowance for loan losses		(12,946	)		(13,305	)
Net loans	$	1,129,046		$	1,042,201

For the three months ended September 30, 2022	Beginning balance		Charge-offs			Recoveries		Provision			Ending Balance
Commercial & Agriculture	$	2,790	$	(22	)	$	12	$	(51	)	$	2,729
Commercial Real Estate:
Owner Occupied		4,729		—			15		182			4,926
Non-Owner Occupied		14,711		—			16		(300	)		14,427
Residential Real Estate		2,859		(39	)		64		152			3,036
Real Estate Construction		1,969		—			—		44			2,013
Farm Real Estate		236		—			1		14			251
Consumer and Other		130		(13	)		4		21			142
Unallocated		11		—			—		238			249
Total	$	27,435	$	(74	)	$	112	$	300		$	27,773

September 30, 2017	30-59 Days Past Due		60-89 Days Past Due		90 Days or Greater		Total Past Due		Current		Purchased Credit- Impaired Loans		Total Loans		Past Due 90 Days and Accruing
Commercial & Agriculture	$	389	$	—	$	664	$	1,053	$	146,395	$	89	$	147,537	$	—
Commercial Real Estate:
Owner Occupied		—		174		516		690		166,988		—		167,678		—
Non-Owner Occupied		164		108		420		692		423,738		—		424,430		—
Residential Real Estate		218		242		878		1,338		266,362		139		267,839		—
Real Estate Construction		—		68		27		95		77,883		—		77,978		—
Farm Real Estate		—		—		193		193		38,773		—		38,966		—
Consumer and Other		86		10		48		144		17,420		—		17,564		44
Total	$	857	$	602	$	2,746	$	4,205	$	1,137,559	$	228	$	1,141,992	$	44

	For the Nine-Month Period Ended September 30, 2017
	Number of Contracts		Pre- Modification Outstanding Recorded Investment		Post- Modification Outstanding Recorded Investment
Commercial & Agriculture		—	$	—	$	—
Commercial Real Estate—Owner Occupied		—		—		—
Commercial Real Estate—Non-Owner Occupied		—		—		—
Residential Real Estate		1		13		13
Real Estate Construction		—		—		—
Farm Real Estate		—		—		—
Consumer and Other		—		—		—
Total Loan Modifications		1	$	13	$	13

	For the Three-Month Period Ended September 30, 2016
	Number of Contracts		Pre- Modification Outstanding Recorded Investment			Post- Modification Outstanding Recorded Investment
Commercial & Agriculture		—	$	—		$	—
Commercial Real Estate—Owner Occupied		—		—			—
Commercial Real Estate—Non-Owner Occupied		—		—			—
Residential Real Estate		—		—	��		—
Real Estate Construction		—		—			—
Farm Real Estate		1		86			86
Consumer and Other		—		—			—
Total Loan Modifications		1	$	86		$	86

	September 30, 2017				September 30, 2016
For the nine months ended:	Average Recorded Investment		Interest Income Recognized		Average Recorded Investment		Interest Income Recognized
Commercial & Agriculture	$	1,609	$	27	$	1,453	$	19
Commercial Real Estate—Owner Occupied		1,632		66		1,954		66
Commercial Real Estate—Non-Owner Occupied		280		5		1,519		858
Residential Real Estate		1,554		56		1,699		60
Real Estate Construction		—		—		473		—
Farm Real Estate		614		21		1,123		17
Consumer and Other		—		—		2		—
Total	$	5,689	$	175	$	8,223	$	1,020

	For the Nine-Month Period Ended September 30, 2017			For the Nine-Month Period Ended September 30, 2016
	(In Thousands)			(In Thousands)
Balance at beginning of period	$	49		$	82
Acquisition of PCI loans		—			—
Accretion		(27	)		(24	)
Balance at end of period	$	22		$	58

	For the Three-Month Period Ended September 30, 2017			For the Three-Month Period Ended September 30, 2016
	(In Thousands)			(In Thousands)
Balance at beginning of period	$	31		$	66
Acquisition of PCI loans		—			—
Accretion		(9	)		(8	)
Balance at end of period	$	22		$	58

	At September 30, 2017		At December 31, 2016
	Acquired Loans with Specific Evidence of Deterioration of Credit Quality (ASC 310-30)		Acquired Loans with Specific Evidence of Deterioration of Credit Quality (ASC 310-30)
	(In Thousands)
Outstanding balance	$	795	$	850
Carrying amount		228		256

	September 30, 2022				September 30, 2021
For the nine months ended	Average Recorded Investment		Interest Income Recognized		Average Recorded Investment		Interest Income Recognized
Commercial & Agriculture	$	86	$	—	$	19	$	—
Commercial Real Estate—Owner Occupied		349		10		449		15
Commercial Real Estate—Non-Owner Occupied		35		—		29		1
Residential Real Estate		516		19		654		24
Farm Real Estate		381		14		584		18
Total	$	1,367	$	43	$	1,735	$	58

	For the Three-Month Period Ended September 30, 2022			For the Three-Month Period Ended September 30, 2021
	(In Thousands)			(In Thousands)
Balance at beginning of period	$	216		$	224
Acquisition of PCI loans		—			—
Accretion		(7	)		(6	)
Transfer from non-accretable to accretable		7			—
Balance at end of period	$	216		$	218

	At September 30, 2022		At December 31, 2021
	Acquired Loans with Specific Evidence of Deterioration of Credit Quality (ASC 310-30)		Acquired Loans with Specific Evidence of Deterioration of Credit Quality (ASC 310-30)
	(In Thousands)
Outstanding balance	$	4,952	$	512
Carrying amount		4,110		290

	For the Nine-Month Period Ended								For the Nine-Month Period Ended
	September 30, 2017 (a)								September 30, 2016 (a)
	Unrealized Gains and Losses on Available-for- Sale Securities		Defined Benefit Pension Items			Total			Unrealized Gains and Losses on Available-for- Sale Securities			Defined Benefit Pension Items			Total
Beginning balance	$	2,008	$	(4,345	)	$	(2,337	)	$	3,554		$	(4,049	)	$	(495	)
Other comprehensive income before reclassifications		1,309		—			1,309			1,514			—			1,514
Amounts reclassified from accumulated other comprehensive loss		6		625			631			(13	)		165			152
Net current-period other comprehensive income		1,315		625			1,940			1,501			165			1,666
Ending balance	$	3,323	$	(3,720	)	$	(397	)	$	5,055		$	(3,884	)	$	1,171

	Amount Reclassified from Accumulated Other Comprehensive Income (Loss) (a)
Details about Accumulated Other Comprehensive (Loss) Components	For the nine months ended September 30, 2017			For the nine months ended September 30, 2016			Affected Line Item in the Statement Where Net Income is Presented
Unrealized gains and losses on available-for-sale securities	$	(9	)	$	20		Net gain (loss) on securities available for sale
Tax effect		3			(7	)	Income tax expense
		(6	)		13		Net of tax
Amortization of defined benefit pension items
Actuarial gains/(losses) (b)		(946	)		(249	)	Salaries, wages and benefits
Tax effect		321			84		Income tax expense
		(625	)		(165	)	Net of tax
Total reclassifications for the period	$	(631	)	$	(152	)	Net of tax

	2017						2016
	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
Amortized intangible assets(1):
MSRs	$	1,022	$	302	$	720	$	912	$	250	$	662
Core deposit intangibles		7,274		6,634		640		7,274		6,152		1,122
Total amortized intangible assets	$	8,296	$	6,936	$	1,360	$	8,186	$	6,402	$	1,784

	MSRs		Core deposit intangibles		Total
2017	$	30	$	104	$	134
2018		40		111		151
2019		40		88		128
2020		40		72		112
2021		40		68		108
Thereafter		530		197		727
	$	720	$	640	$	1,360

	At September 30, 2017						At December 31, 2016
	Federal Funds Purchased			Short-term Borrowings			Federal Funds Purchased			Short-term Borrowings
Outstanding balance	$	—		$	41,750		$	—		$	31,000
Maximum indebtedness		22,500			115,050			20,000			70,400
Average balance		156			42,102			116			10,483
Average rate paid		1.71	%		1.08	%		0.86	%		0.42	%
Interest rate on balance		—			1.17	%		—			0.64	%

At September 30, 2017
Date of Award	Shares		Remaining Expense		Remaining Vesting Period (Years)
March 17, 2015		16,699	$	9		0.25
March 11, 2016		15,748		41		1.25
March 20, 2017		11,713		126		2.25
January 15, 2016		10,260		72		3.25
March 20, 2017		6,185		119		4.25
		60,605	$	367		2.93

	Fair Value Measurements at December 31, 2016 Using:
Assets:	(Level 1)		(Level 2)		(Level 3)
Assets measured at fair value on a recurring basis:
U.S. Treasury securities and obligations of U.S. Government agencies	$	—	$	37,446	$	—
Obligations of states and political subdivisions		—		94,998		—
Mortgage-backed securities in government sponsored entities		—		62,642		—
Equity securities in financial institutions		—		778		—
Swap asset		—		1,839		—
Liabilities measured at fair value on a recurring basis:
Swap liability		—		1,839		—
Assets measured at fair value on a nonrecurring basis:
Impaired loans	$	—	$	—	$	952
Other real estate owned		—		—		37

	Quantitative Information about Level 3 Fair Value Measurements
September 30, 2017	Fair Value		Valuation Technique	Unobservable Input	Range	Weighted Average
Impaired loans	$	1,639	Appraisal of collateral	Appraisal adjustments	10% - 48%		34%
				Liquidation expense	0% - 10%		4%
				Holding period	0 - 30 months	20 months
Other real estate owned	$	27	Appraisal of collateral	Appraisal adjustments	10% - 30%		10%
				Liquidation expense	0% - 10%		10%

	Notional Amount			Weighted Average Rate Received/(Paid)			Impact of a 1 basis point change in interest rates			Repricing Frequency
Derivative Assets	$	60,711			5.09	%	$	35		Monthly
Derivative Liabilities		(60,711	)		-5.09	%		(35	)	Monthly
Net Exposure	$	—					$	—

	Location of	Amount of Gain or (Loss)
Derivatives	Gain or (Loss)	Recognized in
Not Designated	Recognized in	Income on Derivatives
as Hedging Instruments	Income on Derivative	September 30, 2022		September 30, 2021
Interest rate swaps related to customer loans	Other income	$	—	$	64
Total		$	—	$	64

	Core deposit intangibles
2022	$	427
2023		739
2024		684
2025		604
2026		523
Thereafter		1,449
	$	4,426

	Actual From Acquisition Date Through September 30, 2022
	(in thousands)
Net interest income after provision for loan losses	$	1,638
Noninterest income		158
Net income		426

	Pro Formas				Pro Formas
	Three months ended September 30,				Nine months ended September 30,
	2022		2021		2022		2021
Net interest income after provision for loan losses	$	30,405	$	26,891	$	82,100	$	78,452
Noninterest income		5,734		6,693		19,387		25,486
Net income		11,176		10,100		26,914		31,015
Pro forma earnings per share:
Basic	$	0.74	$	0.63	$	1.80	$	1.88
Diluted	$	0.74	$	0.63	$	1.80	$	1.88

Cash paid				$	24,968
Common Shares issued (984,723 shares)					21,122
Total				$	46,090


Net assets acquired:
Cash and due from financial institutions	$	3,098
Securities available for sale		120,399
Time deposits		742
Loans, net		169,202
Other securities		1,553
Premises and equipment		6,073
Accrued interest receivable		670
Core deposit intangible		4,426
Bank owned life insurance		5,918
Other assets		3,767
Noninterest-bearing deposits		(122,642	)
Interest-bearing deposits		(148,552	)
Other borrowings		(21,706	)
Other liabilities		(1,659	)
					21,289
Goodwill resulting from Comunibanc Corp. acquisition				$	24,801

Period	Total Number of Shares Purchased		Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs		Maximum Number (or Approximate Dollar Value) of Shares (Units) that May Yet Be Purchased Under the Plans or Programs
July 1, 2022 - July 31, 2022		91,245	$	21.40		91,245	$	10,369,055
August 1, 2022 - August 31, 2022		57,182	$	21.71		57,182	$	9,127,902
September 1, 2022 - September 30, 2022		138,184	$	21.13		138,184	$	6,208,107
Total		286,611	$	21.33		286,611	$	6,208,107

Exhibit	Description	Location

2.1	Agreement and Plan of Merger, dated January 10, 2022 by and between Civista Bancshares, Inc. and Comunibanc Corp.	Filed as Exhibit 2.1 to Civista Bancshares, Inc.’s Current Report on Form 8-K dated and filed on January 10, 2022 and incorporated herein by reference. (File No. 001-36192)
2.2	Stock Purchase Agreement, dated as of September 29, 2022, by and among Civista Bancshares, Inc., Civista Bank, Vision Financial Group, Inc. and Frederick Summers	Filed as Exhibit 2.1 to Civista Bancshares, Inc.’s Current Report on Form 8-K filed on September 30, 2022 and incorporated herein by reference. (File No. 001-36192)

3.1	Second Amended and Restated Articles of Incorporation of ~~the Company,~~Civista Bancshares, Inc., as filed with the Ohio Secretary of State on ~~December 4, 2015.~~November 15, 2018.	Filed as Exhibit 3.1 to Civista Bancshares, Inc.’s Current Report on Form 8-K, filed on November 16, 2018 and incorporated herein by reference. (File No. 001-36192)


3.2		Amended and Restated Code of Regulations of ~~the Company~~Civista Bancshares, Inc. (adopted April ~~17, 2007).~~15, 2008)		Filed as Exhibit 3.2 to Civista Bancshares, Inc.’s Quarterly Report on Form 10-Q for the period ended September 30, 2017, filed on November 8, 2017 and incorporated herein by reference. (File No. 001-36192)