Document And Entity Information
Document And Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2022 | Mar. 01, 2023 | Jun. 30, 2022 | |
Document And Entity Information [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2022 | ||
Document Transition Report | false | ||
Entity File Number | 0-22345 | ||
Entity Registrant Name | SHORE BANCSHARES INC | ||
Entity Incorporation, State or Country Code | MD | ||
Entity Tax Identification Number | 52-1974638 | ||
Entity Address, Address Line One | 18 E. Dover Street | ||
Entity Address, City or Town | Easton | ||
Entity Address, State or Province | MD | ||
Entity Address, Postal Zip Code | 21601 | ||
City Area Code | 410 | ||
Local Phone Number | 763-7800 | ||
Title of 12(b) Security | Common stock | ||
Trading Symbol | SHBI | ||
Security Exchange Name | NASDAQ | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 326,483,875 | ||
Entity Common Stock, Shares Outstanding | 19,898,388 | ||
Entity Central Index Key | 0001035092 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Fiscal Year Focus | 2022 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false | ||
Auditor Name | Yount, Hyde & Barbour, P.C. | ||
Auditor Firm ID | 613 | ||
Auditor Location | Winchester, Virginia |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
ASSETS | ||
Cash and due from banks | $ 37,661 | $ 16,919 |
Interest-bearing deposits with other banks | 17,838 | 566,694 |
Cash and cash equivalents | 55,499 | 583,613 |
Investment securities: | ||
Available-for-sale, at fair value | 83,587 | 116,982 |
Held to maturity, at amortized cost - fair value of $494,626 (2022) and $401,524 (2021) | 559,455 | 404,594 |
Equity securities, at fair value | 1,233 | 1,372 |
Restricted securities, at cost | 11,169 | 4,159 |
Loans held for sale, at fair value | 4,248 | 37,749 |
Loans held for investment | 2,556,107 | 2,119,175 |
Less: allowance for credit losses | (16,643) | (13,944) |
Loans, net | 2,539,464 | 2,105,231 |
Premises and equipment, net | 51,488 | 51,624 |
Goodwill | 63,266 | 63,421 |
Other intangible assets, net | 5,547 | 7,535 |
Other real estate owned, net | 197 | 532 |
Mortgage servicing rights, at fair value | 5,275 | 4,087 |
Right-of-use assets | 9,629 | 11,370 |
Cash surrender value on life insurance | 59,218 | 47,935 |
Other assets | 28,001 | 19,932 |
TOTAL ASSETS | 3,477,276 | 3,460,136 |
Deposits: | ||
Noninterest-bearing | 862,015 | 927,497 |
Interest-bearing | 2,147,769 | 2,098,739 |
Total deposits | 3,009,784 | 3,026,236 |
Securities sold under retail repurchase agreements | 4,143 | |
Advances from FHLB - short-term | 40,000 | |
Advances from FHLB - long-term | 10,135 | |
Subordinated debt | 43,072 | 42,762 |
Total borrowings | 83,072 | 57,040 |
Lease liabilities | 9,908 | 11,567 |
Other liabilities | 10,227 | 14,600 |
TOTAL LIABILITIES | 3,112,991 | 3,109,443 |
COMMITMENTS AND CONTINGENCIES | ||
STOCKHOLDERS' EQUITY | ||
Common stock, par value $.01 per share; shares authorized - 35,000,000; shares issued and outstanding - 19,849,563 (2022) and 19,807,533 (2021) | 199 | 198 |
Additional paid in capital | 201,494 | 200,473 |
Retained earnings | 171,613 | 149,966 |
Accumulated other comprehensive (loss) income | (9,021) | 56 |
TOTAL STOCKHOLDERS' EQUITY | 364,285 | 350,693 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ 3,477,276 | $ 3,460,136 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
CONSOLIDATED BALANCE SHEETS | ||
Investment securities held to maturity | $ 494,627 | $ 401,524 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 35,000,000 | 35,000,000 |
Common stock, shares, issued | 19,849,563 | 19,807,533 |
Common stock, shares outstanding | 19,849,563 | 19,807,533 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
INTEREST INCOME | ||
Interest and fees on loans | $ 99,122 | $ 64,795 |
Interest and dividends on investment securities: | ||
Interest and dividends on taxable investment securities | 11,507 | 5,006 |
Interest and dividends on tax-exempt investment securities | 6 | |
Interest on deposits with other banks | 3,210 | 368 |
Total interest income | 113,845 | 70,169 |
INTEREST EXPENSE | ||
Interest on deposits | 9,983 | 4,461 |
Interest on short-term borrowings | 74 | 8 |
Interest on long-term borrowings | 2,486 | 1,570 |
Total interest expense | 12,543 | 6,039 |
NET INTEREST INCOME | 101,302 | 64,130 |
Provision for credit losses | 1,925 | (358) |
NET INTEREST INCOME AFTER PROVISION FOR CREDIT LOSSES | 99,377 | 64,488 |
NONINTEREST INCOME | ||
Service charges on deposit accounts | 5,652 | 3,396 |
Trust and investment fee income | 1,784 | 1,881 |
Gains on sales and calls of investment securities | 2 | |
Interchange credits | 4,812 | 3,964 |
Mortgage-banking revenue | 5,210 | 948 |
Title Company revenue | 1,340 | 247 |
Other noninterest income | 4,288 | 3,060 |
Total noninterest income | 23,086 | 13,498 |
NONINTEREST EXPENSE | ||
Salaries and wages | 35,931 | 21,222 |
Employee benefits | 9,908 | 7,262 |
Occupancy expense | 6,242 | 3,690 |
Furniture and equipment expense | 2,018 | 1,553 |
Data processing | 6,890 | 5,001 |
Directors' fees | 839 | 620 |
Amortization of other intangible assets | 1,988 | 734 |
FDIC insurance premium expense | 1,426 | 1,015 |
Other real estate owned expenses, net | 65 | 4 |
Legal and professional fees | 2,840 | 1,742 |
Merger-related expenses | 2,098 | 8,530 |
Other noninterest expenses | 10,077 | 5,433 |
Total noninterest expense | 80,322 | 56,806 |
Income before income taxes | 42,141 | 21,180 |
Income tax expense | 10,964 | 5,812 |
NET INCOME | $ 31,177 | $ 15,368 |
Earnings per common share - Basic and diluted | ||
Basic net income per common share | $ 1.57 | $ 1.17 |
Diluted net income per common share | 1.57 | 1.17 |
Dividends paid per common share | $ 0.48 | $ 0.48 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | ||
Net income | $ 31,177 | $ 15,368 |
Investment securities: | ||
Unrealized holding (losses) on available-for-sale-securities | (12,488) | (2,027) |
Tax effect | 3,411 | 554 |
Total other comprehensive (loss) | (9,077) | (1,473) |
Comprehensive income | $ 22,100 | $ 13,895 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY - USD ($) $ in Thousands | Common Stock [Member] | Additional Paid-in Capital [Member] | Retained Earnings [Member] | Accumulated Other Comprehensive Income (loss) [Member] | Total |
Balances at Dec. 31, 2020 | $ 118 | $ 52,167 | $ 141,205 | $ 1,529 | $ 195,019 |
Net income | 3,998 | 3,998 | |||
Other comprehensive (loss) | (782) | (782) | |||
Retirement of common stock | (819) | (819) | |||
Stock-based compensation | 97 | 97 | |||
Cash dividends declared | (1,409) | (1,409) | |||
Balances at Mar. 31, 2021 | 118 | 51,445 | 143,794 | 747 | 196,104 |
Balances at Dec. 31, 2020 | 118 | 52,167 | 141,205 | 1,529 | 195,019 |
Net income | 15,368 | ||||
Balances at Dec. 31, 2021 | 198 | 200,473 | 149,966 | 56 | 350,693 |
Balances at Mar. 31, 2021 | 118 | 51,445 | 143,794 | 747 | 196,104 |
Net income | 4,031 | 4,031 | |||
Other comprehensive (loss) | (141) | (141) | |||
Stock-based compensation | 99 | 99 | |||
Cash dividends declared | (1,411) | (1,411) | |||
Balances at Jun. 30, 2021 | 118 | 51,544 | 146,414 | 606 | 198,682 |
Net income | 4,616 | 4,616 | |||
Other comprehensive (loss) | (378) | (378) | |||
Stock-based compensation | 91 | 91 | |||
Exercise of options, net of shares surrendered | 6 | 6 | |||
Cash dividends declared | (1,410) | (1,410) | |||
Balances at Sep. 30, 2021 | 118 | 51,641 | 149,620 | 228 | 201,607 |
Net income | 2,723 | 2,723 | |||
Other comprehensive (loss) | (172) | (172) | |||
Severn Bank acquisition | 80 | 148,741 | 148,821 | ||
Stock-based compensation | 91 | 91 | |||
Cash dividends declared | (2,377) | (2,377) | |||
Balances at Dec. 31, 2021 | 198 | 200,473 | 149,966 | 56 | 350,693 |
Net income | 5,613 | 5,613 | |||
Other comprehensive (loss) | (2,228) | (2,228) | |||
Common shares issued for employee stock purchase plan | 37 | 37 | |||
Stock-based compensation | 130 | 130 | |||
Cash dividends declared | (2,381) | (2,381) | |||
Balances at Mar. 31, 2022 | 198 | 200,640 | 153,198 | (2,172) | 351,864 |
Balances at Dec. 31, 2021 | 198 | 200,473 | 149,966 | 56 | 350,693 |
Net income | 31,177 | ||||
Balances at Dec. 31, 2022 | 199 | 201,494 | 171,613 | (9,021) | 364,285 |
Balances at Mar. 31, 2022 | 198 | 200,640 | 153,198 | (2,172) | 351,864 |
Net income | 7,499 | 7,499 | |||
Other comprehensive (loss) | (4,479) | (4,479) | |||
Common shares issued for employee stock purchase plan | 102 | 102 | |||
Stock-based compensation | 172 | 172 | |||
Cash dividends declared | (2,381) | (2,381) | |||
Balances at Jun. 30, 2022 | 198 | 200,914 | 158,316 | (6,651) | 352,777 |
Net income | 9,658 | 9,658 | |||
Other comprehensive (loss) | (3,130) | (3,130) | |||
Common shares issued for employee stock purchase plan | 1 | 124 | 125 | ||
Stock-based compensation | 175 | 175 | |||
Cash dividends declared | (2,384) | (2,384) | |||
Balances at Sep. 30, 2022 | 199 | 201,213 | 165,590 | (9,781) | 357,221 |
Net income | 8,407 | 8,407 | |||
Other comprehensive (loss) | 760 | 760 | |||
Common shares issued for employee stock purchase plan | 122 | 122 | |||
Stock-based compensation | 159 | 159 | |||
Cash dividends declared | (2,384) | (2,384) | |||
Balances at Dec. 31, 2022 | $ 199 | $ 201,494 | $ 171,613 | $ (9,021) | $ 364,285 |
CONSOLIDATED STATEMENTS OF CH_2
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (Parenthetical) | 3 Months Ended |
Dec. 31, 2021 shares | |
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY | |
Severn Bank acquisition (in shares) | 8,053,088 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net Income | $ 31,177 | $ 15,368 |
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | ||
Net accretion of acquisition accounting estimates | (1,768) | (440) |
Provision for credit losses | 1,925 | (358) |
Depreciation and amortization | 5,861 | 3,086 |
Net amortization of securities | 1,414 | 1,579 |
Amortization of debt issuance costs | 122 | 123 |
(Gain) on mortgage banking activities | (3,918) | (918) |
Proceeds from sale of mortgage loans held for sale | 131,286 | 15,562 |
Originations of loans held for sale | (102,144) | (42,199) |
Stock-based compensation expense | 636 | 378 |
Deferred income tax expense (benefit) | (1,182) | 278 |
(Gains) on sales and calls of securities | (2) | |
(Gains) loss on valuation adjustments on mortgage servicing rights | (372) | 59 |
Losses on sales and disposals of premises and equipment | 183 | 4 |
Losses on sales and valuation adjustments on other real estate owned | 44 | 2 |
Fair value adjustment on equity securities | 157 | 40 |
Bank owned life insurance income | (1,118) | (1,090) |
Net changes in: | ||
Accrued interest receivable | (2,665) | 2,145 |
Other assets | (1,450) | (3,045) |
Accrued interest payable | 297 | (5) |
Other liabilities | (5,838) | 1,930 |
Net cash (used in) provided by operating activities | 52,647 | (7,503) |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Proceeds from maturities and principal payments of investment securities available for sale | 20,441 | 40,656 |
Proceeds from maturities and principal payments of investment securities held to maturity | 52,324 | 40,274 |
Purchases of securities held to maturity | (208,133) | (255,514) |
Purchases of equity securities | (18) | (17) |
Purchase of restricted securities | (8,560) | |
Net change in loans | (426,973) | (79,771) |
Purchases of premises and equipment | (2,415) | (3,450) |
Proceeds from sales of premises and equipment | 17 | |
Proceeds from sales of other real estate owned | 394 | |
Improvements to other real estate owned | (34) | |
Redemption of restricted securities | 1,550 | 437 |
Purchases of bank owned life insurance | (10,165) | (10,203) |
Cash acquired in the acquisition of Severn, net of cash paid | 305,781 | |
Net cash (used in) provided by investing activities | (581,572) | 38,193 |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Noninterest-bearing deposits | (65,482) | 35,821 |
Interest-bearing deposits | 49,580 | 334,512 |
Short-term borrowings | 35,857 | 3,093 |
Repayment of long-term borrowings | (10,000) | |
Common stock dividends paid | (9,530) | (6,607) |
Retirement of common stock | (819) | |
Issuance of common stock | 386 | 6 |
Net cash provided by financing activities | 811 | 366,006 |
Net (decrease) increase in cash and cash equivalents | (528,114) | 396,696 |
Cash and cash equivalents at beginning of period | 583,613 | 186,917 |
Cash and cash equivalents at end of period | 55,499 | 583,613 |
Supplemental cash flows information: | ||
Interest paid | 12,621 | 6,007 |
Income taxes paid | 11,851 | 6,253 |
Recognition (remeasurement of) lease liabilities arising from right-of-use assets | (456) | 1,383 |
Transfer from loans held for sale to loans held for investment | 7,791 | |
Transfers from loans to other real estate owned | 69 | 205 |
Unrealized (loss) on securities available for sale | $ (12,488) | $ (2,027) |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2022 | |
Summary of Significant Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The consolidated financial statements include the accounts of Shore Bancshares, Inc. and its subsidiaries (collectively referred to in these Notes as the “Company”), with all significant intercompany transactions eliminated. The investments in subsidiaries are recorded on the Company’s books (Parent only) on the basis of its equity in the net assets of the subsidiaries. The accounting and reporting policies of the Company conform to accounting principles generally accepted in the United States of America (“GAAP”). For purposes of comparability, certain reclassifications have been made to amounts previously reported to conform with the current period presentation. Reclassifications had no effect on prior year net income or stockholders’ equity. Nature of Operations The Company engages in the banking business through Shore United Bank, N.A., a Maryland commercial bank with trust powers. The Company’s primary source of revenue is derived from interest earned on commercial, residential mortgage and other loans, and fees charged in connection with lending and other banking services located in Maryland, Delaware and the Eastern Shore of Virginia. The Company engages in the trust services business through the trust department at Shore United Bank, N.A. under the trade name Wye Financial Partners and conducts secondary market lending activities through a division of the Bank. The Title Company engages in title work related to real estate transactions. Use of Estimates The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and affect the reported amounts of revenues earned and expenses incurred during the reporting period. Actual results could differ from those estimates. Estimates that could change significantly relate to the determination of the allowance for loan losses, loans acquired in business combinations, and the subsequent evaluation of goodwill for impairment. Loans Acquired in a Business Combination Loans acquired in a business combination, such as the Company’s acquisition of Severn, are recorded at estimated fair value on the date of acquisition without the carryover of the related allowance for loan losses. Purchased credit-impaired (PCI) loans are those for which there is evidence of credit deterioration since origination and for which it is probable at the date of acquisition that the Company will not collect all contractually required principal and interest payments. When determining fair value, PCI loans were aggregated into pools of loans based on common risk characteristics as of the date of acquisition such as loan type, date of origination, and evidence of credit quality deterioration such as internal risk grades and past due and nonaccrual status. The difference between contractually required payments at acquisition and the cash flows expected to be collected at acquisition is referred to as the “nonaccretable difference,” and is not recorded. Any excess of cash flows expected at acquisition over the estimated fair value is referred to as the accretable yield and is recognized as interest income over the remaining life of the loan when there is a reasonable expectation about the amount and timing of such cash flows. On a quarterly basis, the Company evaluates its estimate of cash flows expected to be collected. Estimates of cash flows for PCI loans require significant judgment. Subsequent decreases to the expected cash flows will generally result in a provision for loan losses, while subsequent increases in cash flows may result in a reversal of post-acquisition provision for loan losses, or a transfer from nonaccretable difference to accretable yield that increases interest income over the remaining life of the loan or pool(s) of loans. Disposals of loans, which may include sale of loans to third parties, receipt of payments in full or part from the borrower or foreclosure of the collateral, result in removal of the loan from the PCI loan portfolio at its carrying amount. PCI loans are not classified as nonperforming loans by the Company at the time they are acquired, regardless of whether they had been classified as nonperforming by the previous holder of such loans, and they will not be classified as nonperforming so long as, at quarterly re-estimation periods, we believe we will fully collect the new carrying value of the pools of loans. Loans not designated PCI loans as of the acquisition date are designated purchased performing loans. The Company accounts for purchased performing loans using the contractual cash flows method of recognizing discount accretion based on the acquired loans’ contractual cash flows. Purchased performing loans are recorded at fair value, including a credit discount. The fair value discount is accreted as an adjustment to yield over the estimated lives of the loans. There is no allowance for loan losses established at the acquisition date for purchased performing loans. A provision for loan losses may be required in future periods for any deterioration in these loans in future periods. Investment Securities Available for Sale Investment securities available for sale are stated at estimated fair value based on quoted prices. They represent those debt securities which management may sell as part of its asset/liability management strategy or which may be sold in response to changing interest rates, changes in prepayment risk or other similar factors. Realized gains and losses are recorded in noninterest income and are determined on a trade date basis using the specific identification method. Premiums and discounts are amortized or accreted into interest income using the interest method over the lives of the individual securities. Interest on investment securities is recognized in interest income on an accrual basis. Net unrealized holding gains and losses on these securities are reported as accumulated other comprehensive income, a separate component of stockholders’ equity, net of related income taxes. Declines in the fair value of individual available-for-sale securities below their cost that are other than temporary result in write-downs of the individual securities to their fair value and are reflected in earnings as realized losses. Factors affecting the determination of whether an other-than-temporary impairment has occurred include a downgrade of the security by a rating agency, a significant deterioration in the financial condition of the issuer, or a determination that management has the intent to sell the security or will be required to sell the security before recovery of its amortized cost. Investment Securities Held to Maturity Investment securities held to maturity are stated at cost adjusted for amortization of premiums and accretion of discounts. Purchase premiums and discounts are recognized in interest income using the interest method over the terms of the securities. The Company intends and has the ability to hold such securities until maturity. Declines in the fair value of individual held-to-maturity securities below their cost that are other than temporary result in write-downs of the individual securities to their fair value. Factors affecting the determination of whether an other-than-temporary impairment has occurred include a downgrade of the security by a rating agency, a significant deterioration in the financial condition of the issuer, or a determination that management has the intent to sell the security or will be required to sell the security before recovery of its amortized cost. Equity Securities Equity securities with readily determinable fair values are carried at fair value, with changes in fair value reported in net income. Any equity securities without readily determinable fair values are carried at cost, minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for identical or similar investments. Restricted equity securities are carried at cost and are periodically evaluated for impairment based on the ultimate recovery of par value. The entirety of any impairment on equity securities is recognized in earnings. Loans Held for Sale (“LHFS”) The Company has elected to carry its mortgage loans originated for sale at fair value. Fair value is determined based on outstanding investor commitments or, in the absence of such commitments, on current investor yield requirements or third-party pricing models. Fair value adjustments are recorded at each balance sheet date with the changes in fair value recognized in mortgage banking revenue in the Consolidated Statements of Income. Gains and losses on loan sales are determined based on the differential between a loan’s carrying value and sales price and are recognized through mortgage-banking revenue in the Consolidated Statements of Income. LHFS are sold either with the mortgage servicing rights (“MSRs”) released or retained by the Bank. Mortgage Servicing Rights When mortgage loans are sold with servicing retained, the MSRs are initially recorded at fair value with the income statement effect recorded in mortgage banking revenue. Fair value is based on a valuation model that calculates the present value of estimated future net servicing income. The Company measures servicing rights at fair value at each reporting date and records the changes in fair value of servicing assets in earnings in the period in which the changes occur. These gains or losses are included in mortgage banking revenue in the Consolidated Statements of Income. Servicing fee income is also recorded in the mortgage banking revenue line item. Transfers of LHFS to Loans Held for Investment (LHFI) The Company may, from time to time, transfer LHFS to LHFI. Transfers of LHFS to LHFI are accounted for in accordance with the underlying accounting applied to the loan prior to its transfer. For loans where the fair value option had been elected, the Company continues to account for the loan at fair value in the LHFI portfolio. Subsequent changes in the fair value of these loans are recorded in interest income. During the year ended December 31, 2022, the Company transferred LHFS accounted for under the fair value option totaling approximately $7.8 million from LHFS to LHFI There were no transfers between LHFS and LHFI during the year ended December 31, 2021. Loans Loans are stated at their principal amount outstanding net of any deferred fees, premiums, discounts and costs and net of any partial charge-offs. Interest income on loans is accrued at the contractual rate based on the principal amount outstanding. Fees charged and costs capitalized for originating loans are being amortized substantially on the interest method over the term of the loan. A loan is placed on nonaccrual (i.e., interest income is no longer accrued) when it is specifically determined to be impaired or when principal or interest is delinquent for 90 days or more, unless the loan is well secured and in the process of collection. Any unpaid interest previously accrued on those loans is reversed from income. Interest payments received on nonaccrual loans are applied as a reduction of the loan principal balance unless collectability of the principal amount is reasonably assured, in which case interest is recognized on a cash basis. Loans are returned to accrual status when all principal and interest amounts contractually due are brought current and future payments are reasonably assured. A loan is considered impaired if it is probable that the Company will not collect all principal and interest payments according to the loan’s contractual terms when due. An impaired loan may show deficiencies in the borrower’s overall financial condition, payment history, support available from financial guarantors and/or the fair market value of collateral. The impairment of a loan is measured at the present value of expected future cash flows using the loan’s effective interest rate, or at the loan’s observable market price or the fair value of the collateral if the loan is collateral dependent. Generally, the Company measures impairment on such loans by reference to the fair value of the collateral or the present value of expected future cash flows. Once the amount of impairment has been determined, the uncollectible portion is charged off. Income on nonaccrual impaired loans is recognized on a cash basis, and payments are first applied against the principal balance outstanding (i.e., placing impaired loans on nonaccrual status). Generally, interest income is not recognized on impaired loans unless the likelihood of further loss is remote or the impairment analysis yielded no impairment for the loan. The allowance for credit losses may include specific reserves related to impaired loans. Specific reserves remain until charge offs are made. Reserves for probable credit losses related to these loans are based on historical loss ratios and an analysis of qualitative factors and are included in the formula portion of the allowance for credit losses. See additional discussion below under the section, “Allowance for Credit Losses”. A loan is considered a troubled debt restructuring (“TDR”) if a borrower is experiencing financial difficulties and a creditor has granted a concession. Concessions may include interest rate reductions or below market interest rates, principal forgiveness, restructuring amortization schedules and other actions intended to minimize potential losses. Loans are identified to be restructured when signs of impairment arise such as borrower interest rate reduction request, slowness to pay, or when an inability to repay becomes evident. The terms being offered are evaluated to determine if they are more liberal than those that would be indicated by policy or industry standards for similar, untroubled credits. In those situations where the terms or the interest rates are considered to be more favorable than industry standards or the current underwriting guidelines of the Company’s banking subsidiary, the loan is classified as a TDR. All loans designated as TDRs are considered impaired loans and may be on either accrual or nonaccrual status. In instances where the loan has been placed on nonaccrual status, six consecutive months of timely payments are required prior to returning the loan to accrual status. All loans classified as TDRs which are restructured and accrue interest under revised terms require a full and comprehensive review of the borrower’s financial condition, capacity for repayment, realistic assessment of collateral values, and the assessment of risk entered into any workout agreement. Current financial information on the borrower, guarantor, and underlying collateral is analyzed to determine if it supports the ultimate collection of principal and interest. For commercial loans, the cash flows are analyzed, both for the underlying project and globally. For consumer loans, updated salary, credit history and cash flow information is obtained. Current market conditions are also considered. Following a full analysis, the determination of the appropriate loan structure is made. The Company does not participate in any specific government or Company sponsored loan modification programs. All TDR loan agreements are contracts negotiated with each of the borrowers. Allowance for Credit Losses The allowance for credit losses is maintained at a level believed adequate by management to absorb probable losses inherent in the loan portfolio as of the balance sheet date and is based on the size and current risk characteristics of the loan portfolio, an assessment of individual problem loans and actual loss experience, current economic events in specific industries and geographical areas, including unemployment levels, and other pertinent factors, including regulatory guidance and general economic conditions and other observable data. Determination of the allowance is inherently subjective as it requires significant estimates, including the amounts and timing of expected future cash flows or collateral value of impaired loans, estimated losses on pools of similar loans that are based on historical loss experience, and consideration of current economic trends, all of which may be susceptible to significant change. Loans, or portions thereof, that are considered uncollectible are charged off against the allowance, while recoveries of amounts previously charged off are credited to the allowance. The criteria for charge offs are addressed in the Bank’s Collection and Workout Policy. Per the policy, the recognition of the loss of loans or portions of loans will occur when there is a reasonable probability of loss. When the amount of loss can be readily calculated, the loss will be recognized. In cases where a probable charge-off amount cannot be calculated, specific reserves will be maintained. A provision for credit losses is charged to income based on management’s periodic evaluation of the factors previously mentioned, as well as other pertinent factors. Evaluations are conducted at least quarterly and more often if deemed necessary. The allowance for credit losses is an estimate of the probable losses that may be sustained in the loan portfolio. The allowance is based on two basic principles of accounting: (i) Topic 450, “ Contingencies Receivables Three basic components comprise our allowance for credit losses: (i) the specific allowance; (ii) the historical formula allowance; and (iii) the qualitative formula allowance. Each component is determined based on estimates that can and do change when the actual events occur. The specific allowance is established against impaired loans based on our assessment of the losses that may be associated with the individual loans. The specific allowance remains until charge-offs are made or the metrics underlying the impairment calculation change. An impaired loan may show deficiencies in the borrower’s overall financial condition, payment history, support available from financial guarantors and/or the fair market value of collateral. The historical formula allowance is used to estimate the loss on internally risk-rated loans, exclusive of those identified as impaired. Loans are grouped by type (construction, residential real estate, commercial real estate, commercial or consumer) and similar risk characteristics. Each loan pool is assigned allowance factors based on management’s estimate of the risk, complexity and size of individual loans within a particular category using average historical charge-offs by segment over the last 16 quarters. Loans identified as pass-watch, special mention, substandard, and doubtful are considered to have elevated credit risk. These loans are assigned higher allowance factors than favorably rated loans due to management’s concerns regarding collectability or management’s knowledge of particular elements regarding the borrower. The qualitative formula allowance captures losses that have impacted the portfolio but have yet to be recognized in either the specific or historical formula allowance. A pass-watch loan has adequate risk and may include loans which may have been upgraded from another higher risk category. A special mention loan has potential weaknesses that could result in a future loss to the Company if the weaknesses are realized. A substandard loan has certain deficiencies that could result in a future loss to the Company if these deficiencies are not corrected. A doubtful loan has enough risk that there is a high probability that the Company will sustain a loss. The qualitative formula allowance is used to adjust the historical formula allowance to an amount that is reflective of the probable losses inherent in the loan portfolio. The qualitative formula allowance is established through the evaluation of various qualitative factors which are used to develop loss percentages that are applied to the identified pools of loans that are not individually evaluated for impairment. Management has significant discretion in making the adjustments inherent in the determination of the provision and allowance for credit losses, including the establishment of the allowance factors in the qualitative formula allowance component of the allowance. The establishment of the qualitative factors used in the qualitative formula allowance is a continuing exercise, based on management’s ongoing assessment of the totality of all factors, including, but not limited to, delinquencies, loss history, effects of changes in lending policy, the experience and depth of management, national and local economic trends, concentrations of credit, the quality of the loan review system and the effect of other factors as deemed appropriate, and their impact on the portfolio. Allowance factors may change from period to period, resulting in an increase or decrease in the amount of the provision or allowance, based on the same volume and classification of loans. Changes in allowance factors will have a direct impact on the amount of the provision, and a corresponding effect on net income. Errors in management’s perception and assessment of these factors and their impact on the portfolio could result in the allowance not being adequate to cover losses in the portfolio, and may result in additional provisions or charge-offs. Premises and Equipment Land is carried at cost and premises and equipment are stated at cost less accumulated depreciation and amortization. Depreciation and amortization are calculated using the straight-line method over the estimated useful lives of the assets. Useful lives range from three three Long-lived assets are evaluated periodically for impairment when events or changes in circumstances indicate the carrying amount may not be recoverable. Impairment exists when the expected undiscounted future cash flows of a long-lived asset are less than its carrying value. In that event, the Company recognizes a loss for the difference between the carrying amount and the estimated fair value of the asset. Mergers and Acquisitions Business combinations are accounted for under ASC 805, Business Combinations, using the acquisition method of accounting. The acquisition method of accounting requires an acquirer to recognize the assets acquired and the liabilities assumed at the acquisition date measured at their fair values as of that date. To determine the fair values, the Company relies on internal or third-party valuations, such as appraisals, valuations based on discounted cash flow analyses, or other valuation techniques. Under the acquisition method of accounting, the Company identifies the acquirer and the closing date and applies applicable recognition principles and conditions. Acquisition-related costs are costs the Company incurs to effect a business combination. Those costs include advisory, legal, accounting, valuation, and other professional or consulting fees. Some other examples of costs to the Company include systems conversions, integration planning consultants and advertising costs. The Company accounts for acquisition-related costs as expenses in the periods in which the costs are incurred and the services are received, with one exception. The costs to issue debt or equity securities is recognized in accordance with other applicable GAAP. These acquisition-related costs have been and will be included within the consolidated statements of income classified within the noninterest expenses caption. Goodwill and Other Intangible Assets Goodwill represents the excess of the cost of an acquisition over the fair value of the net assets acquired. Other intangible assets represent purchased assets that also lack physical substance but can be distinguished from goodwill because of contractual or other legal rights or because the asset is capable of being sold or exchanged either on its own or in combination with a related contract, asset or liability. Goodwill and other intangible assets are initially required to be recorded at fair value. Determining fair value is subjective, requiring the use of estimates, assumptions and management judgment. Goodwill is tested at least annually for impairment, usually during the fourth quarter, or on an interim basis if circumstances dictate. Intangible assets that have finite lives are amortized over their estimated useful lives and also are subject to impairment testing. If the fair value of a reporting unit is less than book value, an expense may be required to write down the related goodwill to record an impairment loss. As of December 31, 2022, the Company had two operating segments the Community Banking segment and Mortgage Banking segment. Other intangible assets consist of core deposit intangible assets arising from whole bank and branch acquisitions and are amortized using an accelerated method over their estimated useful lives, which range from 7 to 10 years. During 2022 and 2021, goodwill and other intangible assets were subjected to assessments for impairment. No impairment charges were recognized in either year. Our assessment of goodwill concluded it was not more likely that not that the fair value of the Company's reporting units were less than their carrying amount. Other Real Estate Owned Other real estate owned represents assets acquired in satisfaction of loans either by foreclosure or deeds taken in lieu of foreclosure. Properties acquired are recorded at fair value less estimated selling costs at the time of acquisition, establishing a new cost basis. Thereafter, costs incurred to operate or carry the properties as well as reductions in value as determined by periodic appraisals are charged to operating expense. Gains and losses resulting from the final disposition of the properties are included in noninterest expense. Borrowings Short-term and long-term borrowings are comprised primarily of FHLB borrowings. The Company’s short-term borrowings may also include advances on other lines of credit with correspondent banks or re-purchase agreements with customers. The repurchase agreements are securities sold to the Company’s customers, at the customers’ request, under a continuing “roll-over” contract that matures in one business day. The underlying securities sold are U.S. Government agency securities, which are segregated from the Company’s other investment securities by its safekeeping agents. Subordinated Debt Subordinated debt is carried at its outstanding principal balance, net of any unamortized issuance costs. For additional information on the Company’s subordinated debt, refer to Note 12 of the Consolidated Financial Statements. Income Taxes The Company and its subsidiary file a consolidated federal income tax return. The Company accounts for income taxes using the liability method in accordance with required accounting guidance. Under this method, deferred tax assets and liabilities are determined by applying the applicable federal and state income tax rates to cumulative temporary differences. These temporary differences represent differences between financial statement carrying amounts and the corresponding tax bases of certain assets and liabilities. Deferred taxes result from such temporary differences. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the period that includes the enactment date. A valuation allowance, if needed, reduces deferred tax assets to the expected amount most likely to be realized. Realization of deferred tax assets is dependent on the generation of a sufficient level of future taxable income, recoverable taxes paid in prior years and tax planning strategies. The Company evaluates all positive and negative evidence before determining if a valuation allowance is deemed necessary regarding the realization of deferred tax assets. The Company recognizes accrued interest and penalties as a component of tax expense. The provision for income taxes includes the impact of reserve provisions and changes in the reserves that are considered appropriate as well as the related net interest and penalties. In addition, the Company is subject to the continuous examination of its income tax returns by the IRS and other tax authorities which may assert assessments against the Company. The Company regularly assesses the likelihood of adverse outcomes resulting from these examinations and assessments to determine the adequacy of its provision for income taxes. The Company remains subject to examination for tax years ending on or after December 31, 2019. Derivative Financial Instruments and Hedging We account for derivatives in accordance with FASB literature on accounting for derivative instruments and hedging activities. When we enter into a derivative contract, we designate the derivative as held for trading, an economic hedge, or a qualifying hedge as detailed in the literature. The designation may change based upon management’s reassessment or changing circumstances. Derivatives utilized by the Company include interest rate lock commitments (“IRLC”) or (“IRLCs”) and forward settlement contracts. IRLCs occur when we originate mortgage loans with interest rates determined prior to funding. Forward settlement contracts are agreements to buy or sell a quantity of a financial instrument, index, currency, or commodity at a predetermined future date, rate, or price. We designate at inception whether a derivative contract is considered hedging or non-hedging. All of our derivatives are nonexchange traded contracts, and as such, their fair value is based on dealer quotes, pricing models, discounted cash flow methodologies, or similar techniques for which the determination of fair value may require significant management judgement or estimation. For qualifying hedges, we formally document at inception all relationships between hedging instruments and hedged items, as well as risk management objectives and strategies for undertaking various accounting hedges. We primarily utilize derivatives to manage interest rate sensitivity., At December 31, 2022 and 2021 we did not have any designated hedges. Basic and Diluted Earnings Per Common Share Basic earnings per share is calculated by dividing net income available to common stockholders by the weighted-average number of common shares outstanding and does not include the effect of any potentially dilutive common stock equivalents. Included in this calculation due to dividend participation rights are restricted stock awards which have been granted. Diluted earnings per share is calculated by dividing net income by the weighted-average number of shares outstanding, adjusted for the effect of any potentially dilutive common stock equivalents. Transfers of Financial Assets Transfers of financial assets are accounted for as sales, when control over the assets has been surrendered. Control over transferred assets is deemed to be surrendered when (i) the assets have been isolated from the Company, (ii) the transferee obtains the right (free of conditions that constrain it from taking advantage of that right) to pledge or exchange the transferred assets, and (iii) the Company does not maintain effective control over the transferred assets through an agreement to repurchase them before their maturity. Cash and Cash Equivalents Cash and due from banks, interest-bearing deposits with other banks and federal funds sold are considered “cash and cash equivalents” for financial reporting purposes. Certain interest-bearing deposits with banks may exceed balances that are recoverable under Federal Deposit Insurance (“FDIC”) insurance. Balances in excess of FDIC insurance at December 31, 2022 were approximately $1.8 million. Share-Based Compensation The Company may grant share-based compensation to employees and non-employee directors in the form of restricted stock, restricted stock units and stock options. The fair value of restricted stock is determined based on the closing price of the Parent’s common stock on the date of grant. The Company recognizes compensation expense related to restricted stock on a straight-line basis over the vesting period for service-based awa |
Business Combination
Business Combination | 12 Months Ended |
Dec. 31, 2022 | |
Business Combination [Abstract] | |
BUSINESS COMBINATION | NOTE 2. BUSINESS COMBINATION On October 31, 2021 (“Acquisition Date”), the Company completed the acquisition of Severn Bancorp, Inc. (“Severn”), a Maryland charted commercial bank, in accordance with the definitive agreement that was entered into on March 3, 2021, by and among the Company and Severn. The primary reasons for the Company to acquire Severn were to access and deploy excess capital and deposits into a high growth market, while also enhancing scale to drive efficiency and profitability. Additionally, this transaction is expected to enhance the Company’s competitive position in the Columbia/Baltimore/Towson MSA, while filling in our market footprint. In connection with the completion of the merger, former Severn shareholders received 0.6207 shares of Shore common stock and $1.59 in cash for each share of Severn common stock. Based on the $18.48 per share closing price of the Company’s common stock on October 29, 2021 and including the fair value of options cashed-out, the total transaction value was approximately $169.8 million. Upon completion of the acquisition, Shore shareholders owned approximately 59.6% of the combined company, and former Severn shareholders owned approximately 40.4%. As of October 31, 2021, Severn, headquartered in Annapolis, MD, had more than $1.1 billion in assets and operated 7 full-service community banking offices throughout Anne Arundel County, Maryland. The acquisition of Severn was accounted for as a business combination using the acquisition method of accounting and, accordingly, assets acquired, liabilities assumed, and consideration paid are recorded at estimated fair values on the Acquisition Date. The provisional amount of goodwill recognized as of the Acquisition Date was approximately $45.9 million. The Company kept the measurement of goodwill open for any additional adjustments to the fair value of certain accounts. The measurement period was closed within the first 12 months following the acquisition date. Adjustments to the provisional amount of goodwill recognized as of the Acquisition Date are detailed below. The goodwill is not expected to be deductible for tax purposes. The consideration paid for Severn’s common equity and outstanding stock options and the fair values of acquired identifiable assets and assumed identifiable liabilities as of the Acquisition Date were as follows: (In thousands, except per share data) Purchase Price Consideration: Fair value of common shares issued (8,053,088 shares) based on Shore Bancshares, Inc. share price of $18.48 $ 148,821 Cash consideration 20,631 Cash paid for cash-out Severn stock options 310 Cash for fractional shares 3 Total purchase price $ 169,765 Identifiable assets: Cash and cash equivalents $ 326,725 Total securities 146,292 Loans held for sale 9,613 Loans, net (1) 584,776 Premises and equipment, net 24,768 Other real estate owned 329 Core deposit intangible asset 6,550 Other assets (1) 20,319 Total identifiable assets $ 1,119,372 Identifiable liabilities: Deposits $ 955,288 Total debt 28,341 Other liabilities 11,727 Total identifiable liabilities $ 995,356 Fair value of net assets acquired including identifiable intangible assets 124,016 Resulting goodwill (1) $ 45,749 (1) Includes the effect of measurement period adjustments recorded during 2022 and reconciled in the table below. Measurement period adjustments included adjustments related to loan validations and the final accounting for the income taxes of Severn. Goodwill at December 31, 2021 $ 45,904 Effect of measurement period adjustments to: Loans, net (192) Other assets 37 Goodwill at December 31, 2022 $ 45,749 Acquired loans The following table outlines the contractually required payments receivable, cash flows we expect to receive, and the accretable yield for all Severn PCI loans as of the acquisition date. Contractually required payments receivable $ 46,833 Nonaccretable difference (3,364) Cash flows expected to be collected 43,469 Accretable yield (5,667) Fair value $ 37,802 The Company recorded all loans acquired at the estimated fair value on the acquisition date with no carryover of the related allowance for loan losses. The Company determined the net discounted value of cash flows on gross loans totaling $593.3 million, including 1,306 performing loans and 162 PCI loans. The valuation took into consideration the loans’ underlying characteristics, including account types, remaining terms, annual interest rates, interest types, past delinquencies, timing of principal and interest payments, current market rates, loan-to-loan value ratios, loss exposures, and remaining balances. These performing loans were segregated into pools based on loan and payment type. The effect of the valuation process was a total net discount of $8.7 million at acquisition. |
Investment Securities
Investment Securities | 12 Months Ended |
Dec. 31, 2022 | |
Investment Securities [Abstract] | |
INVESTMENT SECURITIES | NOTE 3. INVESTMENT SECURITIES The following table provides information on the amortized cost and estimated fair values of investment securities at December 31. Gross Gross Estimated Amortized Unrealized Unrealized Fair (Dollars in thousands) Cost Gains Losses Value Available-for-sale securities: December 31, 2022 U.S. Government agencies $ 21,798 $ 5 $ 3,625 $ 18,178 Mortgage-backed 72,183 2 8,666 63,519 Otherd debt securities 2,018 — 128 1,890 Total $ 95,999 $ 7 $ 12,419 $ 83,587 December 31, 2021 U.S. Government agencies $ 22,932 $ 7 $ 634 $ 22,305 Mortgage-backed 91,948 1,318 629 92,637 Other debt securities 2,026 14 — 2,040 Total $ 116,906 $ 1,339 $ 1,263 $ 116,982 No available for sale securities were sold during 2022 and 2021. Gross Gross Estimated Amortized Unrealized Unrealized Fair (Dollars in thousands) Cost Gains Losses Value Held-to-maturity securities: December 31, 2022 U.S. Government agencies $ 148,097 $ — $ 13,601 $ 134,496 Mortgage-backed 398,884 — 50,464 348,420 States and political subdivisions 1,474 35 28 1,481 Other debt securities 11,000 — 770 10,230 Total $ 559,455 $ 35 $ 64,863 $ 494,627 December 31, 2021 U.S. Government agencies $ 87,072 $ 20 $ 1,231 $ 85,861 Mortgage-backed 302,604 301 2,248 300,657 States and political subdivisions 400 2 — 402 Other debt securities 14,518 95 9 14,604 Total $ 404,594 $ 418 $ 3,488 $ 401,524 Equity securities with an aggregate fair value of $1.2 million at December 31, 2022 and $1.4 million at December 31, 2021 are presented separately on the balance sheet. The fair value adjustment recorded through earnings totaled $(157) thousand for 2022 and $(40) thousand for 2021, respectively. The following table provides information about gross unrealized losses and fair value by length of time that the individual securities have been in a continuous unrealized loss position at December 31. Less than More than 12 Months 12 Months Total Fair Unrealized Fair Unrealized Fair Unrealized (Dollars in thousands) Value Losses Value Losses Value Losses December 31, 2022 Available-for-sale securities: U.S. Government agencies $ 1,165 $ 4 $ 16,585 $ 3,588 $ 17,750 $ 3,592 Mortgage-backed 29,125 2,409 34,167 6,290 63,292 8,699 Other debt securities 1,890 128 — — 1,890 128 Total $ 32,180 $ 2,541 $ 50,752 $ 9,878 $ 82,932 $ 12,419 Held-to-maturity securities: U.S. Government agencies $ 67,332 $ 2,786 $ 67,163 $ 10,815 $ 134,495 $ 13,601 Mortgage-backed 148,771 9,402 199,649 41,062 348,420 50,464 States and political subdivisions 780 28 — — 780 28 Other debt securities 8,091 409 2,139 361 10,230 770 Total $ 224,974 $ 12,625 $ 268,951 $ 52,238 $ 493,925 $ 64,863 Less than More than 12 Months 12 Months Total Fair Unrealized Fair Unrealized Fair Unrealized (Dollars in thousands) Value Losses Value Losses Value Losses December 31, 2021 Available-for-sale securities: U.S. Government agencies $ 1,561 $ 1 $ 17,368 $ 633 $ 18,929 $ 634 Mortgage-backed 39,851 593 3,562 36 43,413 629 Total $ 41,412 $ 594 $ 20,930 $ 669 $ 62,342 $ 1,263 Held-to-maturity securities: U.S. Government agencies $ 64,268 $ 1,005 $ 11,719 $ 226 $ 75,987 $ 1,231 Mortgage-backed 226,918 1,836 14,564 412 241,482 2,248 Other debt securities 491 9 — — 491 9 Total $ 291,677 $ 2,850 $ 26,283 $ 638 $ 317,960 $ 3,488 All of the securities with unrealized losses in the portfolio have modest duration risk, low credit risk, and minimal losses when compared to total amortized cost. The unrealized losses on debt securities that exist are the result of market changes in interest rates since original purchase and are not related to credit concerns. Because the Company does not intend to sell these securities and it is not more likely than not that the Company will be required to sell these securities before recovery of their amortized cost bases, which may be at maturity for debt securities, the Company considers the unrealized losses to be temporary. There were a hundred and sixteen hundred and ninety two hundred and fourteen The following table provides information on the amortized cost and estimated fair values of investment securities by maturity date at December 31, 2022. Available for sale Held to maturity Amortized Amortized (Dollars in thousands) Cost Fair Value Cost Fair Value Due in one year or less $ 75 $ 74 $ 2,117 $ 2,076 Due after one year through five years 6,658 6,351 108,632 101,165 Due after five years through ten years 42,689 37,856 73,054 66,502 Due after ten years 46,577 39,306 375,652 324,884 Total $ 95,999 $ 83,587 $ 559,455 $ 494,627 The maturity dates for debt securities are determined using contractual maturity dates. The following table sets forth the amortized cost and estimated fair values of securities which have been pledged as collateral for obligations to federal, state and local government agencies, and other purposes as required or permitted by law, or sold under agreements to repurchase at December 31, 2022 and 2021. 2022 2021 Amortized Amortized (Dollars in thousands) Cost Fair Value Cost Fair Value Pledged available-for-sale securities $ 83,288 72,108 $ 78,522 $ 78,352 Pledged held to maturity securities 19,158 16,305 913 915 There were no obligations of states or political subdivisions with carrying values, as to any issuer, exceeding 10% of stockholders’ equity at December 31, 2022 or 2021. |
Loans and Allowance for Credit
Loans and Allowance for Credit Losses | 12 Months Ended |
Dec. 31, 2022 | |
Loans and Allowance for Credit Losses [Abstract] | |
LOANS AND ALLOWANCE FOR CREDIT LOSSES | NOTE 4. LOANS AND ALLOWANCE FOR CREDIT LOSSES The Company makes residential mortgage, commercial and consumer loans to customers primarily in Anne Arundel County, Baltimore City, Baltimore County, Howard County, Kent County, Queen Anne’s County, Caroline County, Talbot County, Dorchester County and Worcester County in Maryland, Kent and Sussex County, Delaware and in Accomack County, Virginia. The following table provides information about the principal classes of the loan portfolio at December 31. (Dollars in thousands) 2022 2021 Construction $ 246,319 $ 239,353 Residential real estate 810,497 654,769 Commercial real estate 1,065,409 896,229 Commercial 147,856 203,377 Consumer 286,026 125,447 Total loans (1) 2,556,107 2,119,175 Allowance for credit losses (16,643) (13,944) Total loans, net $ 2,539,464 $ 2,105,231 (1) Includes net origination costs totaling $1.4 million and $1.2 million as of December 31, 2022 and 2021, respectively. In the normal course of banking business, loans are made to officers and directors and their affiliated interests. These loans are made on substantially the same terms and conditions as those prevailing at the time for comparable transactions with persons who are not related to the Company and are not considered to involve more than the normal risk of collectability. As of December 31, 2022 and 2021, such loans outstanding, both direct and indirect (including guarantees), to directors, their associates and policy-making officers, totaled approximately $24.1 million and $18.7 million, respectively. During 2022 and 2021, loan additions were approximately $7.6 million and $16.5 million of which $15.4 million were due to the acquisition of Severn and loan repayments were approximately $2.2 million and $1.5 million, respectively. At December 31, 2022 and December 31, 2021 included in total loans were $22.9 million and $39.9 million in loans, respectively, acquired as part of the 2017 NWBI branch acquisition. These balances are presented net of the related discount which totaled $298 thousand at December 31, 2022 and $516 thousand at December 31, 2021. At December 31, 2022 and December 31, 2021 included in total loans were $372.2 million and $553.0 million in loans, acquired as part of the acquisition of Severn. These balances are presented net of the related discount which totaled $6.7 million at December 31, 2022 and $8.4 million at December 31, 2021. The following table provides information about all loans acquired from Severn. December 31, 2022 Acquired Loans - Acquired Loans - Purchased Purchased Acquired Loans - (Dollars in thousands) Credit Impaired Performing Total Outstanding principal balance $ 29,620 $ 349,262 $ 378,882 Carrying amount Construction $ 650 $ 18,761 $ 19,411 Residential real estate 13,956 116,118 130,074 Commercial real estate 11,866 174,278 186,144 Commercial 156 35,687 35,843 Consumer 14 697 711 Total loans $ 26,642 $ 345,541 $ 372,183 December 31, 2021 Acquired Loans - Acquired Loans - Purchased Purchased Acquired Loans - (Dollars in thousands) Credit Impaired Performing Total Outstanding principal balance $ 36,943 $ 524,474 $ 561,417 Carrying amount Construction $ 2,379 $ 91,823 $ 94,202 Residential real estate 17,326 167,580 184,906 Commercial real estate 13,594 202,819 216,413 Commercial 321 56,200 56,521 Consumer 30 921 951 Total loans $ 33,650 $ 519,343 $ 552,993 The following table presents a summary of the change in the accretable yield on PCI loans acquired from Severn. For the Year Ended (Dollars in thousands) December 31, 2022 Accretable yield, beginning of period $ 5,367 Accretion (1,603) Reclassification of nonaccretable difference due to improvement in expected cash flows 469 Other changes, net 506 Accretable yield, end of period $ 4,739 In April 2020, the Company began its participation in the Paycheck Protection Program (“PPP”) and continued participation in the Program through its expiration in 2021. As of December 31, 2022, the Company held PPP loans with a total outstanding balance of $187 thousand. As of December 31, 2021, the Company held PPP loans with a total outstanding balance of $27.6 million, of which $9.2 million was acquired from Severn, which are included in the commercial loan segment in the table above. As compensation for originating the loans, the Company received lender processing fees from the SBA, which were deferred, along with the related loan origination costs. The net fees associated with the PPP loans have been accreted to interest income over the remaining contractual lives of the loans, with any unrecognized fees recorded in interest income upon forgiveness and repayment by the SBA. At December 31, 2022, the Bank was servicing $343.8 million in loans for the Federal National Mortgage Association and $74.1 million in loans for the Federal Home Loan Mortgage Corporation. In the normal course of banking business, risks related to specific loan categories are as follows: Construction loans – Construction loans are offered primarily to builders and individuals to finance the construction of single-family dwellings. In addition, the Bank periodically finances the construction of commercial projects. Credit risk factors include the borrower’s ability to successfully complete the construction on time and within budget, changing market conditions which could affect the value and marketability of projects, changes in the borrower’s ability or willingness to repay the loan and potentially rising interest rates which can impact both the borrower’s ability to repay and the collateral value. Residential real estate – Residential real estate loans are typically made to consumers and are secured by residential real estate. Credit risk arises from the borrower’s continuing financial stability, which can be adversely impacted by job loss, divorce, illness, or personal bankruptcy, among other factors. Also impacting credit risk would be a shortfall in the value of the residential real estate in relation to the outstanding loan balance in the event of a default or subsequent liquidation of the real estate collateral. Commercial real estate – Commercial real estate loans consist of both loans secured by owner occupied properties and non-owner occupied properties where an established banking relationship exists and involves investment properties for warehouse, retail, and office space with a history of occupancy and cash flow. These loans are subject to adverse changes in the local economy and commercial real estate markets. Credit risk associated with owner occupied properties arises from the borrower’s financial stability and the ability of the borrower and the business to repay the loan. Non-owner occupied properties carry the risk of a tenant’s deteriorating credit strength, lease expirations in soft markets and sustained vacancies which can adversely impact cash flow. Commercial – Commercial loans are secured or unsecured loans for business purposes. Loans are typically secured by accounts receivable, inventory, equipment and/or other assets of the business. Credit risk arises from the successful operation of the business which may be affected by competition, rising interest rates, regulatory changes and adverse conditions in the local and regional economy. Consumer – Consumer loans include home equity loans and lines, installment loans and personal lines of credit. Credit risk is similar to residential real estate loans above as it is subject to the borrower’s continuing financial stability and the value of the collateral securing the loan. The following tables include impairment information relating to loans and the allowance for credit losses for the years ended December 31. Residential Commercial (Dollars in thousands) Construction real estate real estate Commercial Consumer Total December 31, 2022 Loans individually evaluated for impairment $ 331 $ 5,081 $ 2,540 $ 174 $ 28 $ 8,154 Loans collectively evaluated for impairment 236,901 791,460 1,051,003 147,526 285,984 2,512,874 Acquired loans - PCI 650 13,956 11,866 156 14 26,642 Total loans (1) $ 237,882 $ 810,497 $ 1,065,409 $ 147,856 $ 286,026 $ 2,547,670 Allowance for credit losses allocated to: Loans individually evaluated for impairment $ — $ 127 $ — $ — $ — $ 127 Loans collectively evaluated for impairment 2,973 2,495 4,899 1,652 4,497 16,516 Total allowance $ 2,973 $ 2,622 $ 4,899 $ 1,652 $ 4,497 $ 16,643 (1) Excludes loans measured at fair value of $8.4 million at December 31, 2022. Residential Commercial (Dollars in thousands) Construction real estate real estate Commercial Consumer Total December 31, 2021 Loans individually evaluated for impairment $ 321 $ 3,717 $ 3,833 $ 226 $ — $ 8,097 Loans collectively evaluated for impairment 236,653 633,726 878,802 202,830 125,417 2,077,428 Acquired loans - PCI 2,379 17,326 13,594 321 30 33,650 Total loans $ 239,353 $ 654,769 $ 896,229 $ 203,377 $ 125,447 $ 2,119,175 Allowance for credit losses allocated to: Loans individually evaluated for impairment $ — $ 172 $ 1 $ — $ — $ 173 Loans collectively evaluated for impairment 2,454 2,686 4,597 2,070 1,964 13,771 Acquired loans - PCI — — — — — — Total allowance $ 2,454 $ 2,858 $ 4,598 $ 2,070 $ 1,964 $ 13,944 The allowance for loan losses was 0.65% of total loans and 0.65% when excluding PPP loans, at December 31, 2022 compared to 0.66% and 0.67% at December 31, 2021. The following tables provide information on impaired loans and any related allowance by loan class as of December 31. The difference between the unpaid principal balance and the recorded investment is the amount of partial charge-offs that have been taken and interest paid on nonaccrual loans that has been applied to principal. Recorded Recorded Unpaid investment investment Year-to-date Interest principal with no with an Related average recorded income (Dollars in thousands) balance allowance allowance allowance investment recognized December 31, 2022 Impaired nonaccrual loans: Construction $ 297 $ 297 $ — $ — $ 309 $ — Residential real estate 1,363 1,259 — — 1,661 — Commercial real estate 159 150 — — 604 — Commercial 359 174 — — 227 — Consumer 29 28 — — 43 — Total $ 2,207 $ 1,908 $ — $ — $ 2,844 $ — Impaired accruing TDRs: Construction $ 10 $ 10 $ — $ — $ 16 $ 1 Residential real estate 2,849 1,176 1,539 127 2,979 108 Commercial real estate 1,680 1,680 — — 2,095 56 Commercial — — — — — — Consumer — — — — 5 — Total $ 4,539 $ 2,866 $ 1,539 $ 127 $ 5,095 $ 165 Other impaired accruing loans: Construction $ 24 $ 24 $ — $ — $ 215 $ 6 Residential real estate 1,107 1,107 — — 474 3 Commercial real estate 710 710 — — 553 30 Commercial — — — — 51 1 Consumer — — — — 15 — Total $ 1,841 $ 1,841 $ — $ — $ 1,308 $ 40 Total impaired loans: Construction $ 331 $ 331 $ — $ — $ 540 $ 7 Residential real estate 5,319 3,542 1,539 127 5,114 111 Commercial real estate 2,549 2,540 — — 3,252 86 Commercial 359 174 — — 278 1 Consumer 29 28 — — 63 — Total $ 8,587 $ 6,615 $ 1,539 $ 127 $ 9,247 $ 205 Recorded Recorded Unpaid investment investment Year-to-date Interest principal with no with an Related average recorded income (Dollars in thousands) balance allowance allowance allowance investment recognized December 31, 2021 Impaired nonaccrual loans: Construction $ 297 $ 297 $ — $ — $ 297 $ — Residential real estate 882 803 — — 1,095 — Commercial real estate 994 606 — — 2,122 — Commercial 380 216 — — 242 — Consumer — — — — 9 — Total $ 2,553 $ 1,922 $ — $ — $ 3,765 $ — Impaired accruing TDRs: Construction $ 24 $ 24 $ — $ — $ 30 $ 3 Residential real estate 2,965 475 2,361 172 3,150 146 Commercial real estate 2,807 2,352 455 1 2,952 87 Commercial — — — — — — Consumer — — — — — — Total $ 5,796 $ 2,851 $ 2,816 $ 173 $ 6,132 $ 236 Other impaired accruing loans: Construction $ — $ — $ — $ — $ — $ — Residential real estate 78 78 — — 465 21 Commercial real estate 420 420 — — 470 17 Commercial 10 10 — — 13 — Consumer — — — — — — Total $ 508 $ 508 $ — $ — $ 948 $ 38 Total impaired loans: Construction $ 321 $ 321 $ — $ — $ 327 $ 3 Residential real estate 3,925 1,356 2,361 172 4,710 167 Commercial real estate 4,221 3,378 455 1 5,544 104 Commercial 390 226 — — 255 — Consumer — — — — 9 — Total $ 8,857 $ 5,281 $ 2,816 $ 173 $ 10,845 $ 274 The following tables provide a roll-forward for troubled debt restructurings as of and for the years ended December 31. 1/1/2022 12/31/2022 TDR New Disbursements Charge- Reclassifications/ TDR Related (Dollars in thousands) Balance TDRs (Payments) offs Transfer In/(Out) Payoffs Balance Allowance For the Year Ended December 31, 2022 Accruing TDRs Construction $ 24 $ — $ (14) $ — $ — $ — $ 10 $ — Residential real estate 2,836 — (100) — (20) (1) 2,715 127 Commercial real estate 2,807 — (180) — — (947) 1,680 — Commercial — — — — — — — — Consumer — — — — — — — — Total $ 5,667 $ — $ (294) $ — $ (20) $ (948) $ 4,405 $ 127 Nonaccrual TDRs Construction $ — $ — $ — $ — $ — $ — $ — $ — Residential real estate — — (6) — 20 — 14 — Commercial real estate — — — — — — — — Commercial 216 — (46) — — — 170 — Consumer — — — — — — — — Total $ 216 $ — $ (52) $ — $ 20 $ — $ 184 $ — Total $ 5,883 $ — $ (346) $ — $ — $ (948) $ 4,589 $ 127 1/1/2021 12/31/2021 TDR New Disbursements Charge- Reclassifications/ TDR Related (Dollars in thousands) Balance TDRs (Payments) offs Transfer In/(Out) Payoffs Balance Allowance For the Year Ended December 31, 2021 Accruing TDRs Construction $ 34 $ — $ (10) $ — $ — $ — $ 24 $ — Residential real estate 3,845 — (109) — — (900) 2,836 172 Commercial real estate 3,118 — (311) — — — 2,807 1 Commercial — — — — — — — — Consumer — — — — — — — — Total $ 6,997 $ — $ (430) $ — $ — $ (900) $ 5,667 $ 173 Nonaccrual TDRs Construction $ — $ — $ — $ — $ — $ — $ — $ — Residential real estate — — — — — — — — Commercial real estate — — — — — — — — Commercial 258 — (42) — — — 216 — Consumer — — — — — — — — Total $ 258 $ — $ (42) $ — $ — $ — $ 216 $ — Total $ 7,255 $ — $ (472) $ — $ — $ (900) $ 5,883 $ 173 There were no TDRs which subsequently defaulted within 12 months of modification for the years ended December 31, 2022 and 2021. Generally, a loan is considered in default when principal or interest is past due 90 days or more, the loan is placed on nonaccrual, the loan is charged off, or there is a transfer to OREO or repossessed assets. Management uses risk ratings as part of its monitoring of the credit quality in the Company’s loan portfolio. Loans that are identified as special mention, substandard or doubtful are adversely rated. These loans and the pass/watch loans are assigned higher qualitative factors than favorably rated loans in the calculation of the formula portion of the allowance for credit losses. At December 31, 2022, there were no nonaccrual nonaccrual The following tables provide information on loan risk ratings at December 31. Special (Dollars in thousands) Pass/Performing (1) Pass/Watch Mention Substandard Doubtful PCI Total December 31, 2022 Construction $ 231,160 $ 14,212 $ — $ 297 $ — $ 650 $ 246,319 Residential real estate 761,405 32,467 1,239 1,430 — 13,956 810,497 Commercial real estate 929,501 121,711 1,814 517 — 11,866 1,065,409 Commercial 131,084 15,958 484 174 — 156 147,856 Consumer 285,786 196 2 28 — 14 286,026 Total $ 2,338,936 $ 184,544 $ 3,539 $ 2,446 $ — $ 26,642 $ 2,556,107 (1) Includes loans measured at fair value of $8.4 million at December 31, 2022. Special (Dollars in thousands) Pass/Performing Pass/Watch Mention Substandard Doubtful PCI Total December 31, 2021 Construction $ 210,287 $ 24,513 $ 1,877 $ 297 $ — $ 2,379 $ 239,353 Residential real estate 596,694 38,309 1,539 901 — 17,326 654,769 Commercial real estate 724,561 151,209 4,535 2,330 — 13,594 896,229 Commercial 186,176 16,654 — 226 — 321 203,377 Consumer 125,200 215 — 2 — 30 125,447 Total $ 1,842,918 $ 230,900 $ 7,951 $ 3,756 $ — $ 33,650 $ 2,119,175 The following tables provide information on the aging of the loan portfolio at December 31. Accruing 30‑59 days 60‑89 days Greater than Total (Dollars in thousands) Current (1) past due past due 90 days past due Nonaccrual PCI Total December 31, 2022 Construction $ 239,990 $ 4,343 $ 1,015 $ 24 $ 5,382 $ 297 $ 650 $ 246,319 Residential real estate 787,070 6,214 891 1,107 8,212 1,259 13,956 810,497 Commercial real estate 1,052,314 369 — 710 1,079 150 11,866 1,065,409 Commercial 147,511 15 — — 15 174 156 147,856 Consumer 285,750 223 11 — 234 28 14 286,026 Total $ 2,512,635 $ 11,164 $ 1,917 $ 1,841 $ 14,922 $ 1,908 $ 26,642 $ 2,556,107 Percent of total loans 98.3 % 0.4 % 0.1 % 0.1 % 0.6 % 0.1 % 1.0 % 100.0 % (1) Includes loans measured at fair value of $8.4 million at December 31, 2022. Accruing 30‑59 days 60‑89 days Greater than Total (Dollars in thousands) Current past due past due 90 days past due Nonaccrual PCI Total December 31, 2021 Construction $ 235,757 $ 920 $ — $ — $ 920 $ 297 $ 2,379 $ 239,353 Residential real estate 635,166 1,371 25 78 1,474 803 17,326 654,769 Commercial real estate 881,350 259 — 420 679 606 13,594 896,229 Commercial 202,503 183 62 10 255 298 321 203,377 Consumer 125,130 287 — — 287 — 30 125,447 Total $ 2,079,906 $ 3,020 $ 87 $ 508 $ 3,615 $ 2,004 $ 33,650 $ 2,119,175 Percent of total loans 98.2 % 0.1 % — % — % 0.1 % 0.1 % 1.6 % 100.0 % The following tables provide a summary of the activity in the allowance for credit losses allocated by loan class for the years ended December 31. Allocation of a portion of the allowance to one loan class does not preclude its availability to absorb losses in other loan classes. Residential Commercial (Dollars in thousands) Construction real estate real estate Commercial Consumer Total For the year ended December 31, 2022 Allowance for credit losses: Beginning Balance $ 2,454 $ 2,858 $ 4,598 $ 2,070 $ 1,964 $ 13,944 Charge-offs — (5) (6) (546) (31) (588) Recoveries 13 142 951 227 29 1,362 Net (charge-offs) recoveries 13 137 945 (319) (2) 774 Provision 506 (373) (644) (99) 2,535 1,925 Ending Balance $ 2,973 $ 2,622 $ 4,899 $ 1,652 $ 4,497 $ 16,643 Residential Commercial (Dollars in thousands) Construction real estate real estate Commercial Consumer Total For the year ended December 31, 2021 Allowance for credit losses: Beginning Balance $ 2,022 $ 3,699 $ 5,426 $ 2,089 $ 652 $ 13,888 Charge-offs — — — (235) (28) (263) Recoveries 278 82 114 193 10 677 Net (charge-offs) recoveries 278 82 114 (42) (18) 414 Provision 154 (923) (942) 23 1,330 (358) Ending Balance $ 2,454 $ 2,858 $ 4,598 $ 2,070 $ 1,964 $ 13,944 Foreclosure Proceedings Consumer mortgage loans collateralized by residential real estate property that are in the process of foreclosure totaled $263 thousand and $311 thousand as of December 31, 2022 and 2021, respectively. There were $18 thousand of residential real estate properties included in the balance of other real estate owned at December 31, 2022 and $203 thousand at December 31, 2021. All accruing TDRs were in compliance with their modified terms. Both performing and non-performing TDRs had no further commitments associated with them as of December 31, 2022 and 2021. |
Leases
Leases | 12 Months Ended |
Dec. 31, 2022 | |
Leases [Abstract] | |
LEASES | NOTE 5. LEASES Lease liabilities represent the Company’s obligation to make lease payments and are presented at each reporting date as the net present value of the remaining contractual cash flows. Cash flows are discounted at the Company’s incremental borrowing rate in effect at the commencement date of the lease. Right-of-use assets represent the Company’s right to use the underlying asset for the lease term and are calculated as the sum of the lease liability and if applicable, prepaid rent, initial direct costs and any incentives received from the lessor. The Company’s long-term lease agreements are classified as operating leases. Certain of these leases offer the option to extend the lease term and the Company has included such extensions in its calculation of the lease liabilities to the extent the options are reasonably certain of being exercised. The lease agreements do not provide for residual value guarantees and have no restrictions or covenants that would impact dividends or require incurring additional financial obligations. During 2021, the Company acquired long-term branch leases and equipment due to the acquisition of Severn. These leases were reassessed by management as of the acquisition date of October 31, 2021, which included updating the incremental borrowing rates and remaining lease terms. The following tables present information about the Company’s leases as of and for the years ended December 31. (Dollars in thousands) December 31, 2022 December 31, 2021 Lease liabilities $ 9,908 $ 11,567 Right-of-use assets $ 9,629 $ 11,370 Weighted average remaining lease term 12.55 years 13.61 years Weighted average discount rate 2.50 % 2.48 % For the Year Ended Lease cost (in thousands) December 31, 2022 December 31, 2021 Operating lease cost $ 1,355 $ 902 Short-term lease cost — — Total lease cost $ 1,355 $ 902 Cash paid for amounts included in the measurement of lease liabilities $ 1,268 $ 777 The following table presents a maturity analysis of operating lease liabilities and reconciliation of the undiscounted cash flows to the total of operating lease liabilities at December 31. As of Lease payments due (in thousands) December 31, 2022 2023 $ 1,231 2024 1,141 2025 917 2026 916 2027 849 Thereafter 6,584 Total undiscounted cash flows $ 11,638 Discount 1,730 Lease liabilities $ 9,908 Total gross rental income was $1.3 million and $180 thousand for the years ended December 31, 2022 and December 31, 2021, respectively. The following table presents our minimum future annual rental income on such leases at December 31. As of (In thousands) December 31, 2022 2023 $ 918 2024 701 2025 719 2026 737 2027 418 Thereafter 1,554 Total $ 5,047 |
Premises and Equipment
Premises and Equipment | 12 Months Ended |
Dec. 31, 2022 | |
Premises and Equipment [Abstract] | |
PREMISES AND EQUIPMENT | NOTE 6. PREMISES AND EQUIPMENT The following table provides information on premises and equipment at December 31. (Dollars in thousands) 2022 2021 Land $ 10,886 $ 10,886 Buildings and land improvements 48,605 47,002 Furniture and equipment 8,177 8,467 67,668 66,355 Accumulated depreciation (16,180) (14,731) Total $ 51,488 $ 51,624 Depreciation expense totaled $2.4 million for 2022 and $1.5 million for 2021. |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 12 Months Ended |
Dec. 31, 2022 | |
Goodwill and Other Intangible Assets [Abstract] | |
GOODWILL AND OTHER INTANGIBLE ASSETS | NOTE 7. GOODWILL AND OTHER INTANGIBLE ASSETS The following table provides information on the significant components of goodwill and other acquired intangible assets at December 31. December 31, 2022 Weighted Gross Measurement Accumulated Net Average Carrying Period Impairment Accumulated Carrying Remaining Life (Dollars in thousands) Amount Adjustments Charges Amortization Amount (in years) Goodwill $ 65,631 $ (155) $ (1,543) $ (667) $ 63,266 — Other intangible assets Amortizable Core deposit intangible $ 10,504 $ — $ — $ (4,957) $ 5,547 2.6 Total other intangible assets $ 10,504 $ — $ — $ (4,957) $ 5,547 December 31, 2021 Weighted Gross Accumulated Net Average Carrying Impairment Accumulated Carrying Remaining Life (Dollars in thousands) Amount Additions Charges Amortization Amount (in years) Goodwill $ 19,727 $ 45,904 $ (1,543) $ (667) $ 63,421 — Other intangible assets Amortizable Core deposit intangible $ 3,954 $ 6,550 $ — $ (2,969) $ 7,535 2.9 Total other intangible assets $ 3,954 $ 6,550 $ — $ (2,969) $ 7,535 The aggregate amortization expense was $2.0 million and $734 thousand for the years ended December 31, 2022 and 2021, respectively. The following table presents estimated future remaining amortization for amortizing intangibles at December 31, 2022. (Dollars in thousands) Amortization 2023 $ 1,682 2024 1,376 2025 1,070 2026 765 2027 459 Thereafter 195 Total amortizing intangible assets $ 5,547 |
Other Assets
Other Assets | 12 Months Ended |
Dec. 31, 2022 | |
Other Assets [Abstract] | |
OTHER ASSETS | NOTE 8. OTHER ASSETS The Company had the following other assets at December 31. (Dollars in thousands) 2022 2021 Accrued interest receivable $ 9,384 $ 6,719 Deferred income taxes 7,357 2,926 Prepaid expenses 2,680 2,865 Income taxes receivable 74 616 Other assets 8,506 6,806 Total $ 28,001 $ 19,932 |
Other Liabilities
Other Liabilities | 12 Months Ended |
Dec. 31, 2022 | |
Other Liabilities [Abstract] | |
OTHER LIABILITIES | NOTE 9. OTHER LIABILITIES The Company had the following other liabilities at December 31. (Dollars in thousands) 2022 2021 Accrued interest payable $ 989 $ 692 Accrued salaries and wages 1,360 3,422 Accounts payable 353 2,745 Deferred compensation liability 5,679 4,660 Other liabilities 1,846 3,081 Total $ 10,227 $ 14,600 |
Deposits
Deposits | 12 Months Ended |
Dec. 31, 2022 | |
Deposits [Abstract] | |
DEPOSITS | NOTE 10. DEPOSITS The approximate amount of certificates of deposit of $250,000 or more was $77.7 million and $78.0 million at December 31, 2022 and 2021, respectively. The following table provides information on the approximate maturities of total time deposits at December 31. (Dollars in thousands) 2022 2021 Due in one year or less $ 231,089 $ 291,685 Due in one to three years 162,216 128,222 Due in three to five years 31,417 40,044 Total $ 424,722 $ 459,951 As of December 31, 2022 and 2021, deposits, both direct and indirect, from directors, their associates and policy-making officers, totaled approximately $11.9 million and $7.7 million, respectively. At December 31, 2022 and December 31, 2021, we had no brokered deposits. |
Borrowings
Borrowings | 12 Months Ended |
Dec. 31, 2022 | |
Borrowings/Subordinated Debt [Abstract] | |
BORROWINGS | NOTE 11. BORROWINGS The Company may periodically borrow from a correspondent federal funds line of credit arrangement, under a secured reverse repurchase agreement, or from the FHLB to meet short-term liquidity needs. The following table summarizes certain information on short-term borrowings as of and for the years ended December 31. 2022 2021 (Dollars in thousands) Amount Rate Amount Rate Average for the Year Repurchase agreements $ 683 0.25 % $ 3,017 0.25 % FHLB Advances 1,863 3.87 — — Overnight Fed Funds purchased — — — — At Year End Repurchase agreements $ — — % $ 4,143 0.18 % FHLB Advances 40,000 4.57 — — Overnight Fed Funds purchased — — — — Securities sold under agreements to repurchase are securities sold to customers, at the customers’ request, under a “roll-over” contract that matures in one business day. The underlying securities sold are U.S. Government agency securities, which are segregated in the Company’s custodial accounts from other investment securities. The Bank had $15.0 million in federal funds lines of credit and a reverse repurchase agreement available on a short-term basis from correspondent banks at December 31, 2022 and 2021. In conjunction with the acquisition of Severn, the Company assumed $10.0 million in Long-term FHLB Advances which carried a contractual interest rate of 2.19%. The associated purchase premium at acquisition was $162 thousand which was amortized over the contractual life of the obligation which matured in October 2022. In addition, the Bank had secured credit availability of approximately $298.9 million and $363.9 million from the FHLB at December 31, 2022 and 2021, respectively. The Bank has pledged as collateral, under a blanket lien, all qualifying residential loans under borrowing agreements with the FHLB. The Bank had $40 million in short-term borrowings from the FHLB at December 31, 2022 and no short term FHLB borrowings at December 31, 2021. |
Subordinated Debt
Subordinated Debt | 12 Months Ended |
Dec. 31, 2022 | |
Borrowings/Subordinated Debt [Abstract] | |
SUBORDINATED DEBT | NOTE 12. SUBORDINATED DEBT On August 25, 2020, the Company entered into Subordinated Note Purchase Agreements with certain Purchasers pursuant to which the Company issued and sold $25.0 million in aggregate principal amount with an initial interest rate of 5.375% Fixed-to-Floating Rate Subordinated Notes due September 1, 2030. The Notes were structured to qualify as Tier 2 capital for regulatory capital purposes and bear an initial interest rate of 5.375% until September 1, 2025, with interest during this period payable semi-annually in arrears. From and including September 1, 2025, to but excluding the maturity date or early redemption date, the interest rate will reset quarterly to an annual floating rate equal to three-month SOFR, plus 526.5 basis points, with interest during this period payable quarterly in arrears. The Notes are redeemable by the Company at its option, in whole or in part, on or after September 1, 2025. Initial debt issuance costs were $611 thousand. The debt balance of $24.7 million is presented net of unamortized issuance costs of $326 thousand at December 31, 2022. In conjunction with the acquisition of Severn, the Company assumed $20.6 million in junior subordinated debt securities (“2035 Debentures”). The 2035 Debentures were issued and sold to Severn Capital Trust I (the “Trust”), of which 100% of the common equity is owned by the Company. The Trust was formed for the purpose of issuing corporation-obligated mandatorily redeemable Capital Securities (“Capital Securities”) to third-party investors and using the proceeds from the sale of such Capital Securities to purchase the 2035 Debentures. The 2035 Debentures held by the Trust are the sole assets of the Trust. Distributions on the Capital Securities issued by the Trust are payable quarterly at a rate per annum equal to the interest rate being earned by the Trust on the 2035 Debentures. The Capital Securities are subject to mandatory redemption, in whole or in part, upon repayment of the 2035 Debentures. We have entered into an agreement which, taken collectively, fully and unconditionally guarantees the Capital Securities subject to the terms of the guarantee. Under the terms of the 2035 Debentures, we are permitted to defer the payment of interest on the 2035 Debentures for up to 20 consecutive quarterly periods, provided that no event of default has occurred and is continuing. As of December 31, 2022, we were current on all interest due on the 2035 Debentures. |
Benefit Plans
Benefit Plans | 12 Months Ended |
Dec. 31, 2022 | |
Benefit Plans [Abstract] | |
BENEFIT PLANS | NOTE 13. BENEFIT PLANS 401(k) and Profit Sharing Plan The Company has a 401(k) and profit sharing plan covering substantially all full-time employees. The plan calls for matching contributions by the Company, and the Company makes discretionary contributions based on profits. Company contributions to this plan included in noninterest expense totaled $1.3 million and $696 thousand for 2022 and 2021, respectively. |
Stock-Based Compensation
Stock-Based Compensation | 12 Months Ended |
Dec. 31, 2022 | |
Stock-Based Compensation [Abstract] | |
STOCK-BASED COMPENSATION | NOTE 14. STOCK-BASED COMPENSATION At the 2016 annual meeting, stockholders approved the Shore Bancshares, Inc. 2016 Stock and Incentive Plan (“2016 Equity Plan”), replacing the Shore Bancshares, Inc. 2006 Stock and Incentive Plan (“2006 Equity Plan”), which expired on that date. The Company may issue shares of common stock or grant other equity-based awards pursuant to the 2016 Equity Plan. Stock-based awards granted to date generally are time-based, vest in equal installments on each anniversary of the grant date and range over a one The following tables provide information on stock-based compensation expense as of and for the years ended December 31. December 31, (Dollars in thousands) 2022 2021 Stock-based compensation expense $ 636 $ 378 Excess tax benefits related to stock-based compensation 42 9 December 31, (Dollars in thousands) 2022 2021 Unrecognized stock-based compensation expense $ 138 $ 80 Weighted average period unrecognized expense is expected to be recognized 0.2 years 0.2 years The following table summarizes restricted stock award activity for the Company under the 2016 Equity Plan for the years ended December 31. 2022 2021 Weighted Average Weighted Average Number of Grant Date Number of Grant Date Shares Fair Value Shares Fair Value Nonvested at beginning of period 29,425 $ 13.95 24,505 $ 13.78 Granted 34,184 20.48 26,583 13.81 Vested (26,749) 13.75 (20,240) 13.54 Forfeited — — (1,423) 13.34 Nonvested at end of period 36,860 $ 20.15 29,425 $ 13.95 The fair value of restricted stock awards that vested during 2022 and 2021 was $532 thousand and $309 thousand, respectively. There were no stock options granted during 2022 and 2021. |
Derivatives
Derivatives | 12 Months Ended |
Dec. 31, 2022 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
DERIVATIVES | NOTE 15. DERIVATIVES We maintain and account for derivatives, in the form of IRLCs and mandatory forward contracts, in accordance with the FASB guidance on accounting for derivative instruments and hedging activities. We recognize gains and losses through mortgage-banking revenue in the Consolidated Statements of Income. IRLCs on mortgage loans that we intend to sell in the secondary market are considered derivatives. We are exposed to price risk from the time a mortgage loan is locked in until the time the loan is sold. The period of time between issuance of a loan commitment and closing and sale of the loan generally ranges from 14 days to 120 days. For these IRLCs, we attempt to protect the Bank from changes in interest rates through the use of TBA securities, which are forward contracts, as well as, to a lesser degree, loan level commitments in the form of best efforts and mandatory forward contracts. These assets and liabilities are included in the Consolidated Balance Sheets in other assets and accrued expenses and other liabilities, respectively. The following table provides information pertaining to the carrying amounts of our derivative financial instruments at December 31. December 31, 2022 December 31, 2021 Notional Estimated Notional Estimated (Dollars in thousands) Amount Fair Value Amount Fair Value Asset - IRLCs $ 4,166 $ 35 $ 17,557 $ 380 Asset - TBA securities 8,750 41 26,500 55 Liability - IRLCs 1,150 7 — — Liability - TBA securities 1,000 6 20,500 41 |
Deferred Compensation
Deferred Compensation | 12 Months Ended |
Dec. 31, 2022 | |
Deferred Compensation [Abstract] | |
DEFERRED COMPENSATION | NOTE 16. DEFERRED COMPENSATION The Company has multiple deferred compensation agreements with current and former employees. The Executive Deferred Compensation Plan (the “Plan”) is reserved for members of management and highly compensated employees of the Company and the Bank. During 2019, the Plan was expanded to include additional officers who had not previously participated. The Plan permits a participant to elect, each year, to defer receipt of up to 100% of his or her salary and bonus to be earned in the following year. The Plan also permits the participant to defer the receipt of performance-based compensation not later than six months before the end of the period for which it is to be earned. The deferred amounts are credited to an account maintained on behalf of the participant and are invested at the discretion of each participant in certain deemed investment options selected by the Compensation Committee of the Board of the Company. The actual investments purchased are owned by the Company and held in a Rabbi Trust. The accounts of the Rabbi Trust are consolidated and the investments are included in other assets on the Consolidated Balance Sheets. The Company and the Bank may also make matching, mandatory and discretionary contributions for certain participants. A participant is fully vested at all times in the amounts that he or she elects to defer. Any contributions by the Company will vest over a five-year period. The following table provides information on Shore Bancshares, Inc.’s contributions and participant deferrals to the Plan for 2022 and 2021 and the related deferred compensation liability as of December 31. (Dollars in thousands) 2022 2021 Elective deferrals $ 238 $ 192 Deferred compensation liability 948 972 During 2019, the Company introduced a new SERP plan for executive officers of the Company and the Bank. The related liability is unfunded; however, BOLI was purchased to offset the benefit costs. The following table provides information on the expense recognized during the years ended December 31, as well as the balance of the unfunded SERP liability and the cash surrender value of policies purchased to offset the SERP benefit costs as of December 31. The unfunded SERP liability and cash surrender value were included in other liabilities and other assets, respectively. (Dollars in thousands) 2022 2021 Cash surrender value $ 56,117 $ 38,414 Deferred compensation liability - SERP 4,177 3,114 SERP Expense 1,063 1,455 Lastly, in 2016, the Bank assumed agreements held by the former CNB Bank under which its former directors had elected to defer part of their fees and compensation while serving on the former Board of CNB. The amounts deferred were invested in insurance policies on the lives of the respective individuals. Amounts available under the policies are to be paid to the individuals as retirement benefits over future years. The following table includes information on the deferred compensation liability and cash surrender value as of December 31. (Dollars in thousands) 2022 2021 Deferred compensation liability $ 450 $ 554 Cash surrender value 2,260 2,200 |
Other Expenses
Other Expenses | 12 Months Ended |
Dec. 31, 2022 | |
Other Expenses [Abstract] | |
OTHER EXPENSES | NOTE 17. OTHER EXPENSES The following table summarizes the Company’s other noninterest expenses for the years ended December 31. (Dollars in thousands) 2022 2021 Advertising and marketing $ 898 $ 339 Other customer expense 1,075 693 Other expense 3,694 2,425 Other loan expense 1,670 188 Software expense 1,853 1,048 Travel and entertainment expense 478 216 Trust professional fees 409 524 Total other noninterest expense $ 10,077 $ 5,433 |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2022 | |
Income Taxes [Abstract] | |
INCOME TAXES | NOTE 18. INCOME TAXES The following table provides information on components of income tax expense for the years ended December 31. (Dollars in thousands) 2022 2021 Current tax expense: Federal $ 8,814 $ 3,920 State 3,332 1,614 12,146 5,534 Deferred income tax (benefit) expense: Federal (911) 136 State (271) 142 (1,182) 278 Total income tax expense $ 10,964 $ 5,812 The following table provides a reconciliation of tax computed at the statutory federal tax rate to the actual tax expense for the years ended December 31. 2022 2021 Tax at federal statutory rate 21 % 21 % Tax effect of: Tax-exempt income (1.0) (1.6) State income taxes, net of federal benefit 5.7 6.6 Other 0.3 1.4 Actual income tax expense rate 26.0 % 27.4 % The following table provides information on significant components of the Company’s deferred tax assets and liabilities for the years ended December 31. December 31, December 31, (Dollars in thousands) 2022 2021 Deferred tax assets: Allowance for credit losses $ 4,460 $ 3,728 Write-downs of other real estate owned 21 12 Nonaccrual loan interest 345 253 Lease liabilities 2,635 3,021 Deferred compensation 1,522 1,246 Deferred loan costs 1,183 730 Unrealized losses on available-for-sale securities 3,399 — Other 1,487 903 Total deferred tax assets 15,052 9,893 Less valuation allowance (791) (474) Deferred tax assets, net of valuation allowance 14,261 9,419 Deferred tax liabilities: Depreciation 2,491 1,030 Right-of-use assets 2,560 2,968 Mortgage servicing rights 1,405 1,084 Acquisition accounting adjustments 57 986 Deferred capital gain on branch sale 220 228 Unrealized gains on available-for-sale securities — 13 Other 171 184 Total deferred tax liabilities 6,904 6,493 Net deferred tax assets $ 7,357 $ 2,926 |
Earnings Per Common Share
Earnings Per Common Share | 12 Months Ended |
Dec. 31, 2022 | |
Earnings Per Share [Abstract] | |
EARNINGS PER COMMON SHARE | NOTE 19. EARNINGS PER COMMON SHARE Basic earnings per common share is calculated by dividing net income available to common stockholders by the weighted average number of common shares outstanding during the period. Diluted earnings per common share is calculated by dividing net income available to common stockholders by the weighted average number of common shares outstanding during the period, adjusted for the dilutive effect of common stock equivalents (stock-based awards). The following table provides information relating to the calculation of earnings per common share for the years ended December 31. For the Year Ended December 31, (In thousands, except per share data) 2022 2021 Net Income $ 31,177 $ 15,368 Weighted average shares outstanding - Basic and Diluted 19,847 13,119 Earnings per common share - Basic and Diluted $ 1.57 $ 1.17 There were no weighted average common stock equivalents excluded from the calculation of diluted earnings per share for the years ended December 31, 2022 and 2021. |
Regulatory Capital Requirements
Regulatory Capital Requirements | 12 Months Ended |
Dec. 31, 2022 | |
Regulatory Capital Requirements [Abstract] | |
REGULATORY CAPITAL REQUIREMENTS | NOTE 20. REGULATORY CAPITAL REQUIREMENTS Banks and bank holding companies are subject to various regulatory capital requirements administered by the federal banking agencies. Failure to meet minimum capital requirements can initiate certain mandatory - and possibly additional discretionary - actions by regulators that, if undertaken, could have a direct material effect on the financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Bank must meet specific capital guidelines that involve quantitative measures of the Banks’ assets, liabilities, and certain off-balance sheet items as calculated under regulatory accounting practices. The Banks’ capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk weightings, and other factors. Quantitative measures established by regulation to ensure capital adequacy require the Company and Bank to maintain amounts and ratios (set forth in the table below) of Common Equity Tier 1, Tier 1 and total capital (as defined in the regulations) to risk-weighted assets (as defined), and of Tier 1 capital (as defined) to average assets (leverage ratio). As of December 31, 2022, management believes that the Company and the Bank met all capital adequacy requirements to which they were subject. As of December 31, 2022, the most recent notification from our primary regulator categorized Shore United Bank, N.A., as well capitalized under the regulatory framework for prompt corrective action. There are no conditions or events since that notification that management believes would change the Bank’s classification. To be categorized as well capitalized, the Bank must maintain minimum common equity Tier 1, Tier 1 risk-based and total risk-based capital ratios, and Tier 1 leverage ratios, which are described below. The minimum ratios for capital adequacy purposes are 7.00%, 8.50%, 10.50% and 4.00% for the common equity Tier 1, Tier 1 risk-based capital, total risk-based capital and leverage ratios, respectively which include a capital conservation buffer of 2.50% respectively. To be categorized as well capitalized, a bank must maintain minimum ratios of 6.50%, 8.00%, 10.00% and 5.00% for its common equity Tier 1, Tier 1 risk-based capital, total risk-based capital and leverage ratios, respectively. The following tables present the capital amounts and ratios at December 31. Common Total Net Tier 1 Total Equity Risk- Risk- Adjusted Common Risk-Based Risk-Based Tier 1 (Dollars in thousands) Tier 1 Tier 1 Based Weighted Average Equity Capital Capital Leverage 2022 Capital Capital Capital Assets Total Assets Tier 1 ratio Ratio Ratio Ratio Shore Bancshares, Inc. $ 304,493 $ 322,891 $ 364,419 $ 2,619,400 $ 3,390,516 11.62 % 12.33 % 13.91 % 9.52 % Shore United Bank, N.A. $ 335,802 $ 335,802 $ 352,657 $ 2,618,939 $ 3,386,771 12.82 % 12.82 % 13.47 % 9.92 % Common Total Net Tier 1 Total Equity Risk- Risk- Adjusted Common Risk-Based Risk-Based Tier 1 (Dollars in thousands) Tier 1 Tier 1 Based Weighted Average Equity Capital Capital Leverage 2021 Capital Capital Capital Assets Total Assets Tier 1 ratio Ratio Ratio Ratio Shore Bancshares, Inc. $ 279,681 $ 279,681 $ 336,696 $ 2,191,557 $ 2,966,412 12.76 % 12.76 % 15.36 % 9.43 % Shore United Bank, N.A. $ 304,362 $ 304,362 $ 318,614 $ 2,189,775 $ 2,965,319 13.90 % 13.90 % 14.55 % 9.48 % Bank and holding company regulations impose certain restrictions on dividend payments by the Bank, as well as restricting extensions of credit and transfers of assets between the Bank and the Company. At December 31, 2022, the Bank could pay dividends to the parent to the extent of its earnings so long as it maintained required capital ratios. The Bank issued a dividend to Shore Bancshares, Inc. in the fourth quarter of 2021 of $25.0 million in relation to the purchase of Severn. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income (LOSS) | 12 Months Ended |
Dec. 31, 2022 | |
Accumulated Other Comprehensive Income [Abstract] | |
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) | NOTE 21. ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) The Company records unrealized holding gains (losses), net of tax, on investment securities available for sale as accumulated other comprehensive income (loss), a separate component of stockholders’ equity. The following table provides information on the changes in the components of accumulated other comprehensive income (loss) for the years ended December 31. Unrealized gains (losses) on available for sale (Dollars in thousands) securities Balance, December 31, 2021 $ 56 Other comprehensive (loss) (9,077) Balance, December 31, 2022 $ (9,021) Balance, December 31, 2020 $ 1,529 Other comprehensive (loss) (1,473) Balance, December 31, 2021 $ 56 |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2022 | |
Fair Value Measurements [Abstract] | |
FAIR VALUE MEASUREMENTS | NOTE 22. FAIR VALUE MEASUREMENTS Accounting guidance under GAAP defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. This accounting guidance also establishes a fair value hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The Company uses fair value measurements to record fair value adjustments to certain assets and liabilities and to determine fair value disclosures. Securities available for sale and equity securities with readily determinable fair values are recorded at fair value on a recurring basis. Additionally, from time to time, the Company may be required to record at fair value other assets on a nonrecurring basis, such as impaired loans, loans held for sale and other real estate owned (foreclosed assets). These nonrecurring fair value adjustments typically involve application of lower of cost or market accounting or write-downs of individual assets. Under fair value accounting guidance, assets and liabilities are grouped at fair value in three levels, based on the markets in which the assets and liabilities are traded and the reliability of the assumptions used to determine their fair values. These hierarchy levels are: Level 1 inputs – Unadjusted quoted prices in active markets for identical assets or liabilities that the entity has the ability to access at the measurement date. Level 2 inputs – Inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. These might include quoted prices for similar assets or liabilities in active markets, and inputs other than quoted prices that are observable for the asset or liability, such as interest rates and yield curves that are observable at commonly quoted intervals. Level 3 inputs – Unobservable inputs for determining the fair values of assets or liabilities that reflect an entity’s own assumptions about the assumptions that market participants would use in pricing the assets or liabilities. Assets Measured at Fair Value on a Recurring Basis Investment Securities Available for Sale Fair value measurement for investment securities available for sale is based on quoted prices from an independent pricing service. The fair value measurements consider observable data that may include present value of future cash flows, prepayment assumptions, credit loss assumptions and other factors. The Company classifies its investments in U.S. Treasury securities, if any, as Level 1 in the fair value hierarchy, and it classifies its investments in U.S. Government agencies securities and mortgage-backed securities issued or guaranteed by U.S. Government sponsored entities as Level 2. Equity Securities Fair value measurement for equity securities is based on quoted market prices retrieved by the Company via on-line resources. Although these securities have readily available fair market values, the Company deems that they be classified as level 2 investments in the fair value hierarchy due to not being considered traded in a highly active market. LHFS LHFS are carried at fair value, which is determined based on Mark to Trade (MTT) for allocated/committed loans or Mark to Market (MTM) analysis for unallocated/uncommitted loans based on third-party pricing models using quoted prices for similar loans and adjusted for observable inputs related to the loans. LHFI, at fair value Certain loans that have been transferred from LHFS to LHFI have and continue to be accounted for under the fair value option as described in Note 1. These loans are valued based on third-party pricing models using quoted prices for similar loans and adjusted for observable inputs related to the loans. MSRs The fair value of MSRs is determined using a valuation model administered by a third party that calculates the present value of estimated future net servicing income. The model incorporates assumptions that market participants use in estimating future net servicing income, including estimates of prepayment speeds, discount rate, default rates, cost to service (including delinquency and foreclosure costs), escrow account earnings, contractual servicing fee income, and other ancillary income such as late fees. Management reviews all significant assumptions on a quarterly basis. Mortgage loan prepayment speed, a key assumption in the model, is the annual rate at which borrowers are forecasted to repay their mortgage loan principal. The discount rate used to determine the present value of estimated future net servicing income, another key assumption in the model, is an estimate of the required rate of return investors in the market would require for an asset with similar risk. Both assumptions can, and generally will, change as market conditions and interest rates change. The significant unobservable inputs used in the fair value measurement of the reporting entity’s residential MSRs are prepayment speeds, probability of default, rate of return, and cost of servicing. Significant increases/decreases in any of those inputs in isolation would have resulted in a significantly lower/higher fair value measurement. Generally, a change in the assumption used for prepayment speeds would have been accompanied by a directionally similar change in the markets, i.e., the 10-Year Treasury, and in the probability of default. IRLCs We utilize a third-party specialist model to estimate the fair value of our IRLCs, which are valued based upon mortgage securities (TBA) prices less estimated costs to process and settle the loan. Fair value is adjusted for the estimated probability of the loan closing with the borrower. (Dollars in thousands) Fair Value Valuation Technique Unobservable Input Range December 31, 2022 MSRs (1) $ 5,275 Market Approach Weighted average prepayment speed (PSA) (2) 121 IRLCs - net asset $ 28 Market Approach Range of pull through rate 78% - 100% Average pull through rate 92% (Dollars in thousands) Fair Value Valuation Technique Unobservable Input Range December 31, 2021 MSRs (1) $ 4,087 Market Approach Weighted average prepayment speed (PSA) (2) 156 IRLCs - asset $ 380 Market Approach Range of pull through rate 77% - 100% Average pull through rate 93% (1) The weighted average was calculated with reference to the principal balance of the underlying mortgages. (2) PSA = Public Securities Association Standard Prepayment Model The following table presents activity in MSRs for the year ended December 31. For the Year Ended (Dollars in thousands) December 31, 2022 Beginning balance $ 4,087 Servicing rights resulting from sales of loans 816 Valuation adjustment 372 Ending balance $ 5,275 The following table presents activity in the IRLCs for the year ended December 31. For the Year Ended (Dollars in thousands) December 31, 2022 Beginning balance $ 380 Valuation adjustment (352) Ending balance $ 28 Forward Contracts To avoid interest rate risk, we hedge the open locked/closed position with TBA forward trades. On a regular basis, we allocate disbursed loans to mandatory commitments with government-sponsored enterprises (“GSE”) and private investors delivering the loans within 120 days of origination to maximize interest earnings. For a small percentage of our business, we enter into best efforts forward sales commitments with investors at the time we make an IRLC to a borrower. Once a loan has been closed and funded, the best efforts commitments convert to mandatory forward sales commitments. The mandatory commitments are derivatives, and we measure and report them at fair value. Fair value is based on the gain or loss that would occur if we were to pair-off the transaction with the investor at the measurement date. This is a level 2 input. We have elected to measure and report best efforts commitments at fair value using a valuation methodology similar to that used for mandatory commitments. Market assumptions utilized in the fair value measurement of the reporting entity’s residential mortgage derivatives, inclusive of IRLCs, Closed Loan Inventory, TBA derivative trades, and Mandatory Forwards may be subject to investor overlays that may result in a significantly lower fair value measurement. Generally such overlays are announced with advanced notice in order to include the risk adjuster, however there are times when announcements are mandated resulting in a lower fair value measurement. Additionally market assumptions such as spec pool payups may result in a significantly higher fair value measurement at time of loan allocation to specific trades. The following tables present the recorded amount of assets measured at fair value on a recurring basis for the years ended December 31. No assets were transferred from one hierarchy level to another during 2022 or 2021. Significant Other Significant Quoted Observable Unobservable Prices Inputs Inputs (Dollars in thousands) Fair Value (Level 1) (Level 2) (Level 3) December 31, 2022 Assets: Securities available for sale: U.S. Government agencies $ 18,178 $ — $ 18,178 $ — Mortgage-backed 63,519 — 63,519 — Other debt securities 1,890 — 1,890 — 83,587 — 83,587 — Equity securities 1,233 — 1,233 — TBA securities 41 — 41 — LHFS 4,248 — 4,248 — LHFI, at fair value 8,437 — 8,437 — MSRs 5,275 — — 5,275 IRLCs 35 — — 35 Total assets at fair value $ 102,856 $ — $ 97,546 $ 5,310 Liabilities: IRLCs $ 7 $ — $ — $ 7 TBA securities 6 — 6 — Total liabilities at fair value $ 13 $ — $ 6 $ 7 Significant Other Significant Quoted Observable Unobservable Prices Inputs Inputs (Dollars in thousands) Fair Value (Level 1) (Level 2) (Level 3) December 31, 2021 Assets: Securities available for sale: U.S. Government agencies $ 22,305 $ — $ 22,305 $ — Mortgage-backed 92,637 — 92,637 — Other debt securities 2,040 — 2,040 — 116,982 — 116,982 — Equity securities 1,372 — 1,372 — TBA securities 55 — 55 — LHFS 37,749 — 37,749 — MSRs 4,087 — — 4,087 IRLCs 380 — — 380 Total assets at fair value $ 160,625 $ — $ 156,158 $ 4,467 Liabilities: TBA securities $ 41 $ — $ 41 $ — Total liabilities at fair value $ 41 $ — $ 41 $ — Assets Measured at Fair Value on a Nonrecurring Basis Impaired Loans Loans are considered impaired when, based on current information and events, it is probable that the Company will be unable to collect all amounts due according to the contractual terms of the loan agreement. Loan impairment is measured using the present value of expected cash flows, the loan’s observable market price or the fair value of the collateral (less selling costs) if the loans are collateral dependent and these are considered Level 3 in the fair value hierarchy. Collateral may be real estate and/or business assets including equipment, inventory and/or accounts receivable. The value of business equipment, inventory and accounts receivable, discounted on management’s review and analysis. Appraised and reported values may be discounted based on management’s historical knowledge, changes in market conditions from the time of valuation, and/or management’s expertise and knowledge of the client and the client’s business. Impaired loans are reviewed and evaluated on at least a quarterly basis for additional impairment and adjusted accordingly, based on the factors identified above. Valuation techniques are consistent with those techniques applied in prior periods. Other Real Estate Owned (Foreclosed Assets) Foreclosed assets are adjusted for fair value upon transfer of loans to foreclosed assets establishing a new cost basis. Subsequently, foreclosed assets are carried at the lower of carrying value or fair value. The estimated fair value for foreclosed assets included in Level 3 are determined by independent market based appraisals and other available market information, less costs to sell, that may be reduced further based on market expectations or an executed sales agreement. If the fair value of the collateral deteriorates subsequent to the initial recognition, the Company records the foreclosed asset as a non-recurring Level 3 adjustment. Valuation techniques are consistent with those techniques applied in prior periods. The following tables set forth the Company’s financial assets subject to fair value adjustments (impairment) on a nonrecurring basis for the years ended December 31, that are valued at the lower of cost or market. Assets are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. Quantitative Information about Level 3 Fair Value Measurements Weighted (Dollars in thousands) Fair Value Valuation Technique Unobservable Input Range Average (3) December 31, 2022 Nonrecurring measurements: Impaired loans $ 1,412 Discounted cash flow analysis (1) Discount rate 6% - 6.5% (6%) Other real estate owned $ 197 Appraisal of collateral (1) Appraisal adjustments (2) 0% - 20% (2%) Quantitative Information about Level 3 Fair Value Measurements Weighted (Dollars in thousands) Fair Value Valuation Technique Unobservable Input Range Average (3) December 31, 2021 Nonrecurring measurements: Impaired loans $ 617 Appraisal of collateral (1) Liquidation expense (2) 10% (10%) Impaired loans $ 2,026 Discounted cash flow analysis (1) Discount rate 4% - 7.25% (6%) Other real estate owned $ 532 Appraisal of collateral (1) Appraisal adjustments (2) 20% - 40% (35%) (1) Fair value is generally determined through independent appraisals of the underlying collateral (impaired loans and OREO) or discounted cash flow analyses (impaired loans), which generally include various level III inputs which are not observable. (2) Appraisals may be adjusted by management for qualitative factors such as economic conditions and estimated liquidation expenses. The range of liquidation expenses and other appraisal adjustments are presented as a percent of the appraisal. (3) Unobservable inputs were weighted by the relative fair value of the instruments. Fair Value of Financial Assets and Financial Liabilities The following table presents the carrying amounts and estimated fair values of the Company’s financial instruments for the years ended December 31. Fair values for December 31, 2022 and 2021 were estimated using an exit price notion. December 31, 2022 December 31, 2021 Estimated Estimated Carrying Fair Carrying Fair (Dollars in thousands) Amount Value Amount Value Financial assets Level 1 inputs Cash and cash equivalents $ 55,499 $ 55,499 $ 583,613 $ 583,613 Level 2 inputs Investment securities available for sale $ 83,587 $ 83,587 $ 116,982 $ 116,982 Investment securities held to maturity 559,455 494,626 404,594 401,524 Equity securities 1,233 1,233 1,372 1,372 Restricted securities 11,169 11,169 4,159 4,159 LHFS 4,248 4,248 37,749 37,749 TBA securities 41 41 55 55 Cash surrender value on life insurance 59,218 59,218 47,935 47,935 Loans, at fair value 8,437 8,437 — — Level 3 inputs Loans, net $ 2,531,027 $ 2,431,808 $ 2,105,231 $ 2,106,373 MSRs 5,275 5,275 4,087 4,087 IRLCs 35 35 380 380 Financial liabilities Level 2 inputs Deposits: Noninterest-bearing demand $ 862,015 $ 862,015 $ 927,497 $ 927,497 Checking plus interest 694,101 694,101 524,143 524,143 Money market 709,132 709,132 889,099 889,099 Savings 319,814 319,814 225,546 225,546 Club 374 374 388 388 Certificates of deposit 424,348 410,455 459,563 461,135 Securities sold under retail repurchase agreement — — 4,143 4,143 Advances from FHLB - short-term 40,000 40,002 — — Advances from FHLB - long-term — — 10,135 10,187 Subordinated debt 43,072 41,193 42,762 44,876 TBA Securities 6 6 41 41 Level 3 inputs IRLCs 7 7 — — |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2022 | |
Commitments and Contingencies [Abstract] | |
COMMITMENTS AND CONTINGENCIES | NOTE 23. COMMITMENTS AND CONTINGENCIES In the normal course of business, to meet the financial needs of its customers, the Bank is a party to financial instruments with off-balance sheet risk. These financial instruments include commitments to extend credit and standby letters of credit. Commitments to extend credit are agreements to lend to a customer as long as there is no violation of any condition established in the contract. Letters of credit are conditional commitments issued by the Bank to guarantee the performance of a customer to a third party. Letters of credit and other commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. Because many of the letters of credit and commitments are expected to expire without being drawn upon, the total commitment amount does not necessarily represent future cash requirements. The following table provides information on commitments outstanding for the years ended December 31. (Dollars in thousands) December 31, 2022 December 31, 2021 Commitments to extend credit $ 406,353 $ 421,088 Letters of credit 8,009 8,399 Total $ 414,362 $ 429,487 The Bank has established a reserve for off balance sheet credit exposures. The reserve is established as losses are estimated to have occurred through a loss for off balance sheet credit exposures charged to earnings. Losses are charged against the allowance when management believes the required funding of these exposures is uncollectible. While this evaluation is completed on a regular basis, it is inherently subjective as it requires estimates that are susceptible to significant revision as more information becomes available. The Company provides banking services to customers who do business in the cannabis industry. Prior to the second quarter of 2022, the Company restricted these businesses to include only those in the medical-use cannabis industry in the state of Maryland. During the second quarter of 2022, the Company expanded its cannabis banking program to include both medical and adult-use licensees in other states, with an initial offering of the Company’s existing Maryland customers with multi-state operations. While the Company is providing banking services to customers that are engaged in growing, processing, and sales of medical-use cannabis in a manner that complies with applicable state law, such customers engaged in those activities currently violate Federal law. The Company may be deemed to be aiding and abetting illegal activities through the services that it provides to these customers. While we are not aware of any instance of a federally insured financial institution being subject to such aiding and abetting liability, the strict enforcement of Federal laws regarding cannabis would likely result in the Company’s inability to continue to provide banking services to these customers and the Company could have legal action taken against it by the Federal government, including imprisonment and fines. There is an uncertainty of the potential impact to the Company’s Consolidated Financial Statements if the Federal government takes actions against the Company. As of December 31, 2022, the Company has not accrued an amount for the potential impact of any such actions. Following is a summary of the level of business activities with our cannabis customers: ● Deposit and loan balances at December 31, 2022 were approximately $131.7 million, or 4.4% of total deposits, and $54.9 million, or 2.2% of total gross loans, respectively. ● Interest and noninterest income for the year ended December 31, 2022, were approximately $4.9 million and $2.0 million, respectively In the normal course of business, Shore Bancshares, Inc. and its subsidiaries may become involved in litigation arising from banking, financial, and other activities. Management, after consultation with legal counsel, does not anticipate that the future liability, if any, arising out of current proceedings will have a material effect on the Company’s financial condition, operating results, or liquidity. |
Segment Reporting
Segment Reporting | 12 Months Ended |
Dec. 31, 2022 | |
Segment Reporting [Abstract] | |
SEGMENT REPORTING | NOTE 24. SEGMENT REPORTING We are in the business of providing financial services and we operate in two business segments – commercial and consumer banking, termed “community banking” and mortgage-banking. Community banking is conducted through the Bank and involves delivering a broad range of financial services, including lending and deposit taking, to individuals and commercial enterprises. This segment also includes our treasury and administrative functions. Mortgage-banking is conducted through the Bank’s secondary marketing department and involves originating first and second-lien residential mortgages for sale in the secondary market. Results of the mortgage banking segment for the year ended December 31, 2022, reflect a full year of operating results, while results for the year ended December 31, 2021, reflect results for the mortgage banking segment from the Acquisition Date of Severn through the end of the year. Prior to the acquisition of Severn, the Company did not engage in the business of originating first and second lien residential mortgages for sale in the secondary market. The following tables present certain information regarding our business segments as of and for the years ended December 31. Community Consolidated (Dollars in thousands) Banking Mortgage Banking Total For the Year Ended December 31, 2022 Interest Income $ 113,253 $ 592 $ 113,845 Interest Expense 12,501 42 12,543 Net interest income 100,752 550 101,302 Provision for credit losses 1,925 — 1,925 Net interest income after provision for credit losses 98,827 550 99,377 Noninterest income 17,876 5,210 23,086 Noninterest expense 75,267 5,055 80,322 Income before income taxes 41,436 705 42,141 Income tax expense 10,782 182 10,964 Net income $ 30,654 $ 523 $ 31,177 Total assets, December 31, 2022 $ 3,467,548 $ 9,728 $ 3,477,276 Community Consolidated (Dollars in thousands) Banking Mortgage Banking Total For the Year Ended December 31, 2021 Interest Income $ 70,037 $ 132 $ 70,169 Interest Expense 6,031 8 6,039 Net interest income 64,006 124 64,130 Provision for credit losses (358) — (358) Net interest income after provision for credit losses 64,364 124 64,488 Noninterest income 12,550 948 13,498 Noninterest expense 55,628 1,178 56,806 Income (loss) before income taxes 21,286 (106) 21,180 Income tax expense (benefit) 5,841 (29) 5,812 Net income (loss) $ 15,445 $ (77) $ 15,368 Total assets, December 31, 2021 $ 3,416,519 $ 43,617 $ 3,460,136 |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2022 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | NOTE 25. RELATED PARTY TRANSACTIONS The Company leases a portion of one of its facilities to a law firm, in which the Chairman of the Board of the Company and the Bank is a partner. In January 2022, the lease entered the final five-year renewal option under the leasing agreement. The total rent payments received were $305 thousand for the year ended December 31, 2022 and $50 thousand for the year ended December 31, 2021. The law firm also reimburses the Company for its share of common area maintenance and utilities. In addition, the law firm represents the Company and the Bank in certain legal matters. Other related party transactions consisting of normal lending and depository relationships are described in Note 4. Loans and Allowance for Credit Losses and Note 10. Deposits, respectively. |
Pending Merger
Pending Merger | 12 Months Ended |
Dec. 31, 2022 | |
Business Combination [Abstract] | |
Pending Merger | NOTE 26. PENDING MERGER On December 14, 2022, the Company and The Community Financial Corporation (TCFC) entered into a definitive agreement for the Company to acquire TCFC. Under the terms of the agreement, TCFC shareholders will have the right to receive 2.3287 shares of Shore common stock and cash in lieu of any fractional shares of Shore common stock. Upon closing, shareholders of Shore will own approximately 60% of the combined company and shareholders of TCFC will own approximately 40% of the combined company. The transaction is subject to satisfaction of customary closing conditions, including approval from Shore and TCFC shareholders. Shore and TCFC have received all required regulatory approvals and waivers. The transaction is expected to close late in the second quarter or early in the third quarter of 2023. As of December 31, 2022, TCFC had more than $2.4 billion in assets and operated ten full-service offices in Maryland and two full-service offices in Virginia. |
Parent Company Financial Inform
Parent Company Financial Information | 12 Months Ended |
Dec. 31, 2022 | |
Parent Company Financial Information [Abstract] | |
PARENT COMPANY FINANCIAL INFORMATION | NOTE 27. PARENT COMPANY FINANCIAL INFORMATION The following tables provide condensed financial information for Shore Bancshares, Inc. (Parent Company Only) at and for the years ending December 31. Condensed Balance Sheets December 31, (Dollars in thousands) 2022 2021 Assets Cash $ 7,145 $ 13,092 Investment in subsidiaries 396,897 376,453 Other assets 5,392 5,712 Total assets $ 409,434 $ 395,257 Liabilities Accrued interest payable $ 744 $ 551 Other liabilities 1,333 1,251 Long-term debt 43,072 42,762 Total liabilities 45,149 44,564 Stockholders’ equity Common stock 199 198 Additional paid in capital 201,494 200,473 Retained earnings 171,613 149,966 Accumulated other comprehensive (loss) income (9,021) 56 Total stockholders’ equity 364,285 350,693 Total liabilities and stockholders’ equity $ 409,434 $ 395,257 Condensed Statements of Income For the Years Ended December 31, (Dollars in thousands) 2022 2021 Income Dividends from subsidiaries $ 5,500 $ 25,000 Company owned life insurance income 67 110 Total income 5,567 25,110 Expenses Interest expense 2,451 1,560 Salaries and employee benefits 324 423 Legal and professional fees 1,654 2,465 Other operating expenses 540 384 Total expenses 4,969 4,832 Income before income tax (benefit) and equity (deficit) in undistributed net income of subsidiaries 598 20,278 Income tax (benefit) (1,059) (990) Income before (deficit) equity in undistributed net income of subsidiaries 1,657 21,268 Equity (deficit) in undistributed net income of subsidiaries 29,520 (5,900) Net income $ 31,177 $ 15,368 Condensed Statements of Cash Flows For the Years Ended December 31, (Dollars in thousands) 2022 2021 Cash flows from operating activities: Net income $ 31,177 $ 15,368 Adjustments to reconcile net income to cash provided by operating activities: (Equity) deficit in undistributed net income of subsidiaries (29,521) 5,900 Amortization of debt issuance costs 122 123 Stock-based compensation expense 636 378 Company owned life insurance income (67) (110) Acquisition accounting adjustments 188 31 Net decrease (increase) in other assets 387 (1,552) Net increase (decrease) increase in other liabilities 275 (142) Net cash provided by operating activities 3,197 19,996 Cash flows from investing activities: Purchase of company owned life insurance — (192) Acquisition of business activity, net of cash paid — (15,945) Net cash (used in) investing activities — (16,137) Cash flows from financing activities: Common stock dividends paid (9,530) (6,607) Retirement of common stock — (819) Issuance of common stock 386 — Exercise of stock options — 6 Net cash (used in) financing activities (9,144) (7,420) Net (decrease) in cash and cash equivalents (5,947) (3,561) Cash and cash equivalents at beginning of year 13,092 16,653 Cash and cash equivalents at end of year $ 7,145 $ 13,092 |
Revenue Recognition
Revenue Recognition | 12 Months Ended |
Dec. 31, 2022 | |
Revenue Recognition [Abstract] | |
REVENUE RECOGNITION | NOTE 28. REVENUE RECOGNITION Topic 606 does not apply to revenue associated with financial instruments, including revenue from loans and securities. Topic 606 is applicable to noninterest revenue streams such as trust and asset management income, deposit related fees, interchange fees and merchant income. Noninterest revenue streams in-scope of Topic 606 are discussed below. Service Charges on Deposit Accounts Service charges on deposit accounts consist of account analysis fees (i.e., net fees earned on analyzed business and public checking accounts), monthly service fees, check orders, 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. Check orders and 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 at the end of the month through a direct charge to customers’ accounts. Trust and Investment Fee Income Trust and investment fee income 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 a few days after month end through a direct charge to customers’ accounts. The Company does not earn performance-based incentives. Optional services such as real estate sales and tax return preparation services are also available to existing trust and asset management customers. 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. Title Company Revenue Title Company revenue consists of revenue earned on performing title work for real estate transactions. The revenue is earned when the title work is performed. Payment for such performance obligations generally occurs at the time of the settlement of a real estate transaction. As such settlement is generally within 90 days of the performance of the title work, we recognize the revenue at the time of the settlement. All contract issuance costs are expensed as incurred. We had no contract assets or liabilities at December 31, 2022. Other Noninterest Income Other noninterest income consists of: fees, exchange, other service charges, safety deposit box rental fees, and other miscellaneous revenue streams. Fees and other service charges are primarily comprised of debit and credit card income, ATM fees, merchant services income, 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 Visa. ATM fees are primarily generated when a Company cardholder uses a non-Company ATM or a non-Company cardholder uses a Company ATM. Merchant services income mainly represents fees charged to merchants to process their debit and credit card transactions, in addition to account management fees. Other service charges include revenue from processing wire transfers, bill pay service, cashier’s checks, and other services. 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. Safe deposit box rental fees are charged to the customer on an annual basis and recognized upon receipt of payment. The Company determined that rentals and renewals of safe deposit boxes will be recognized on a monthly basis consistent with the duration of the performance obligation. The following presents noninterest income from continued operations, segregated by revenue streams in-scope and out-of-scope of Topic 606, for the years ended December 31. December 31, (Dollars in thousands) 2022 2021 Noninterest Income In-scope of Topic 606: Service charges on deposit accounts $ 5,652 $ 3,396 Trust and investment fee income 1,784 1,881 Interchange income 4,812 3,964 Title Company revenue 1,340 247 Other noninterest income 1,752 1,519 Noninterest Income (in-scope of Topic 606) 15,340 11,007 Noninterest Income (out-of-scope of Topic 606) 7,746 2,491 Total Noninterest Income $ 23,086 $ 13,498 Contract Balances A contract asset balance occurs when an entity performs a service for a customer before the customer pays consideration (resulting in a contract receivable) or before payment is due (resulting in a contract asset). A contract liability balance is an entity’s obligation to transfer a service to a customer for which the entity has already received payment (or payment is due) from the customer. The Company’s noninterest revenue streams are largely based on transactional activity, or standard month-end revenue accruals such as asset management fees based on month-end market values. Consideration is often received immediately or shortly after the Company satisfies its performance obligation and revenue is recognized. The Company does not typically enter into long-term revenue contracts with customers, and therefore, does not experience significant contract balances. As of December 31, 2022 and 2021, the Company did not have any significant contract balances. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2022 | |
Summary of Significant Accounting Policies [Abstract] | |
Nature of Operations | Nature of Operations The Company engages in the banking business through Shore United Bank, N.A., a Maryland commercial bank with trust powers. The Company’s primary source of revenue is derived from interest earned on commercial, residential mortgage and other loans, and fees charged in connection with lending and other banking services located in Maryland, Delaware and the Eastern Shore of Virginia. The Company engages in the trust services business through the trust department at Shore United Bank, N.A. under the trade name Wye Financial Partners and conducts secondary market lending activities through a division of the Bank. The Title Company engages in title work related to real estate transactions. |
Use of Estimates | Use of Estimates The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and affect the reported amounts of revenues earned and expenses incurred during the reporting period. Actual results could differ from those estimates. Estimates that could change significantly relate to the determination of the allowance for loan losses, loans acquired in business combinations, and the subsequent evaluation of goodwill for impairment. |
Loans Acquired in a Business Combination | Loans Acquired in a Business Combination Loans acquired in a business combination, such as the Company’s acquisition of Severn, are recorded at estimated fair value on the date of acquisition without the carryover of the related allowance for loan losses. Purchased credit-impaired (PCI) loans are those for which there is evidence of credit deterioration since origination and for which it is probable at the date of acquisition that the Company will not collect all contractually required principal and interest payments. When determining fair value, PCI loans were aggregated into pools of loans based on common risk characteristics as of the date of acquisition such as loan type, date of origination, and evidence of credit quality deterioration such as internal risk grades and past due and nonaccrual status. The difference between contractually required payments at acquisition and the cash flows expected to be collected at acquisition is referred to as the “nonaccretable difference,” and is not recorded. Any excess of cash flows expected at acquisition over the estimated fair value is referred to as the accretable yield and is recognized as interest income over the remaining life of the loan when there is a reasonable expectation about the amount and timing of such cash flows. On a quarterly basis, the Company evaluates its estimate of cash flows expected to be collected. Estimates of cash flows for PCI loans require significant judgment. Subsequent decreases to the expected cash flows will generally result in a provision for loan losses, while subsequent increases in cash flows may result in a reversal of post-acquisition provision for loan losses, or a transfer from nonaccretable difference to accretable yield that increases interest income over the remaining life of the loan or pool(s) of loans. Disposals of loans, which may include sale of loans to third parties, receipt of payments in full or part from the borrower or foreclosure of the collateral, result in removal of the loan from the PCI loan portfolio at its carrying amount. PCI loans are not classified as nonperforming loans by the Company at the time they are acquired, regardless of whether they had been classified as nonperforming by the previous holder of such loans, and they will not be classified as nonperforming so long as, at quarterly re-estimation periods, we believe we will fully collect the new carrying value of the pools of loans. Loans not designated PCI loans as of the acquisition date are designated purchased performing loans. The Company accounts for purchased performing loans using the contractual cash flows method of recognizing discount accretion based on the acquired loans’ contractual cash flows. Purchased performing loans are recorded at fair value, including a credit discount. The fair value discount is accreted as an adjustment to yield over the estimated lives of the loans. There is no allowance for loan losses established at the acquisition date for purchased performing loans. A provision for loan losses may be required in future periods for any deterioration in these loans in future periods. |
Investment Securities Available for Sale | Investment Securities Available for Sale Investment securities available for sale are stated at estimated fair value based on quoted prices. They represent those debt securities which management may sell as part of its asset/liability management strategy or which may be sold in response to changing interest rates, changes in prepayment risk or other similar factors. Realized gains and losses are recorded in noninterest income and are determined on a trade date basis using the specific identification method. Premiums and discounts are amortized or accreted into interest income using the interest method over the lives of the individual securities. Interest on investment securities is recognized in interest income on an accrual basis. Net unrealized holding gains and losses on these securities are reported as accumulated other comprehensive income, a separate component of stockholders’ equity, net of related income taxes. Declines in the fair value of individual available-for-sale securities below their cost that are other than temporary result in write-downs of the individual securities to their fair value and are reflected in earnings as realized losses. Factors affecting the determination of whether an other-than-temporary impairment has occurred include a downgrade of the security by a rating agency, a significant deterioration in the financial condition of the issuer, or a determination that management has the intent to sell the security or will be required to sell the security before recovery of its amortized cost. |
Investment Securities Held to Maturity | Investment Securities Held to Maturity Investment securities held to maturity are stated at cost adjusted for amortization of premiums and accretion of discounts. Purchase premiums and discounts are recognized in interest income using the interest method over the terms of the securities. The Company intends and has the ability to hold such securities until maturity. Declines in the fair value of individual held-to-maturity securities below their cost that are other than temporary result in write-downs of the individual securities to their fair value. Factors affecting the determination of whether an other-than-temporary impairment has occurred include a downgrade of the security by a rating agency, a significant deterioration in the financial condition of the issuer, or a determination that management has the intent to sell the security or will be required to sell the security before recovery of its amortized cost. |
Equity Securities | Equity Securities Equity securities with readily determinable fair values are carried at fair value, with changes in fair value reported in net income. Any equity securities without readily determinable fair values are carried at cost, minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for identical or similar investments. Restricted equity securities are carried at cost and are periodically evaluated for impairment based on the ultimate recovery of par value. The entirety of any impairment on equity securities is recognized in earnings. |
Loans Held for Sale ("LHFS") | Loans Held for Sale (“LHFS”) The Company has elected to carry its mortgage loans originated for sale at fair value. Fair value is determined based on outstanding investor commitments or, in the absence of such commitments, on current investor yield requirements or third-party pricing models. Fair value adjustments are recorded at each balance sheet date with the changes in fair value recognized in mortgage banking revenue in the Consolidated Statements of Income. Gains and losses on loan sales are determined based on the differential between a loan’s carrying value and sales price and are recognized through mortgage-banking revenue in the Consolidated Statements of Income. LHFS are sold either with the mortgage servicing rights (“MSRs”) released or retained by the Bank. |
Mortgage Servicing Rights | Mortgage Servicing Rights When mortgage loans are sold with servicing retained, the MSRs are initially recorded at fair value with the income statement effect recorded in mortgage banking revenue. Fair value is based on a valuation model that calculates the present value of estimated future net servicing income. The Company measures servicing rights at fair value at each reporting date and records the changes in fair value of servicing assets in earnings in the period in which the changes occur. These gains or losses are included in mortgage banking revenue in the Consolidated Statements of Income. Servicing fee income is also recorded in the mortgage banking revenue line item. |
Transfers of LHFS to Loans Held for Investment (LHFI) | Transfers of LHFS to Loans Held for Investment (LHFI) The Company may, from time to time, transfer LHFS to LHFI. Transfers of LHFS to LHFI are accounted for in accordance with the underlying accounting applied to the loan prior to its transfer. For loans where the fair value option had been elected, the Company continues to account for the loan at fair value in the LHFI portfolio. Subsequent changes in the fair value of these loans are recorded in interest income. During the year ended December 31, 2022, the Company transferred LHFS accounted for under the fair value option totaling approximately $7.8 million from LHFS to LHFI There were no transfers between LHFS and LHFI during the year ended December 31, 2021. |
Loans and Allowance for Credit Losses | Loans Loans are stated at their principal amount outstanding net of any deferred fees, premiums, discounts and costs and net of any partial charge-offs. Interest income on loans is accrued at the contractual rate based on the principal amount outstanding. Fees charged and costs capitalized for originating loans are being amortized substantially on the interest method over the term of the loan. A loan is placed on nonaccrual (i.e., interest income is no longer accrued) when it is specifically determined to be impaired or when principal or interest is delinquent for 90 days or more, unless the loan is well secured and in the process of collection. Any unpaid interest previously accrued on those loans is reversed from income. Interest payments received on nonaccrual loans are applied as a reduction of the loan principal balance unless collectability of the principal amount is reasonably assured, in which case interest is recognized on a cash basis. Loans are returned to accrual status when all principal and interest amounts contractually due are brought current and future payments are reasonably assured. A loan is considered impaired if it is probable that the Company will not collect all principal and interest payments according to the loan’s contractual terms when due. An impaired loan may show deficiencies in the borrower’s overall financial condition, payment history, support available from financial guarantors and/or the fair market value of collateral. The impairment of a loan is measured at the present value of expected future cash flows using the loan’s effective interest rate, or at the loan’s observable market price or the fair value of the collateral if the loan is collateral dependent. Generally, the Company measures impairment on such loans by reference to the fair value of the collateral or the present value of expected future cash flows. Once the amount of impairment has been determined, the uncollectible portion is charged off. Income on nonaccrual impaired loans is recognized on a cash basis, and payments are first applied against the principal balance outstanding (i.e., placing impaired loans on nonaccrual status). Generally, interest income is not recognized on impaired loans unless the likelihood of further loss is remote or the impairment analysis yielded no impairment for the loan. The allowance for credit losses may include specific reserves related to impaired loans. Specific reserves remain until charge offs are made. Reserves for probable credit losses related to these loans are based on historical loss ratios and an analysis of qualitative factors and are included in the formula portion of the allowance for credit losses. See additional discussion below under the section, “Allowance for Credit Losses”. A loan is considered a troubled debt restructuring (“TDR”) if a borrower is experiencing financial difficulties and a creditor has granted a concession. Concessions may include interest rate reductions or below market interest rates, principal forgiveness, restructuring amortization schedules and other actions intended to minimize potential losses. Loans are identified to be restructured when signs of impairment arise such as borrower interest rate reduction request, slowness to pay, or when an inability to repay becomes evident. The terms being offered are evaluated to determine if they are more liberal than those that would be indicated by policy or industry standards for similar, untroubled credits. In those situations where the terms or the interest rates are considered to be more favorable than industry standards or the current underwriting guidelines of the Company’s banking subsidiary, the loan is classified as a TDR. All loans designated as TDRs are considered impaired loans and may be on either accrual or nonaccrual status. In instances where the loan has been placed on nonaccrual status, six consecutive months of timely payments are required prior to returning the loan to accrual status. All loans classified as TDRs which are restructured and accrue interest under revised terms require a full and comprehensive review of the borrower’s financial condition, capacity for repayment, realistic assessment of collateral values, and the assessment of risk entered into any workout agreement. Current financial information on the borrower, guarantor, and underlying collateral is analyzed to determine if it supports the ultimate collection of principal and interest. For commercial loans, the cash flows are analyzed, both for the underlying project and globally. For consumer loans, updated salary, credit history and cash flow information is obtained. Current market conditions are also considered. Following a full analysis, the determination of the appropriate loan structure is made. The Company does not participate in any specific government or Company sponsored loan modification programs. All TDR loan agreements are contracts negotiated with each of the borrowers. Allowance for Credit Losses The allowance for credit losses is maintained at a level believed adequate by management to absorb probable losses inherent in the loan portfolio as of the balance sheet date and is based on the size and current risk characteristics of the loan portfolio, an assessment of individual problem loans and actual loss experience, current economic events in specific industries and geographical areas, including unemployment levels, and other pertinent factors, including regulatory guidance and general economic conditions and other observable data. Determination of the allowance is inherently subjective as it requires significant estimates, including the amounts and timing of expected future cash flows or collateral value of impaired loans, estimated losses on pools of similar loans that are based on historical loss experience, and consideration of current economic trends, all of which may be susceptible to significant change. Loans, or portions thereof, that are considered uncollectible are charged off against the allowance, while recoveries of amounts previously charged off are credited to the allowance. The criteria for charge offs are addressed in the Bank’s Collection and Workout Policy. Per the policy, the recognition of the loss of loans or portions of loans will occur when there is a reasonable probability of loss. When the amount of loss can be readily calculated, the loss will be recognized. In cases where a probable charge-off amount cannot be calculated, specific reserves will be maintained. A provision for credit losses is charged to income based on management’s periodic evaluation of the factors previously mentioned, as well as other pertinent factors. Evaluations are conducted at least quarterly and more often if deemed necessary. The allowance for credit losses is an estimate of the probable losses that may be sustained in the loan portfolio. The allowance is based on two basic principles of accounting: (i) Topic 450, “ Contingencies Receivables Three basic components comprise our allowance for credit losses: (i) the specific allowance; (ii) the historical formula allowance; and (iii) the qualitative formula allowance. Each component is determined based on estimates that can and do change when the actual events occur. The specific allowance is established against impaired loans based on our assessment of the losses that may be associated with the individual loans. The specific allowance remains until charge-offs are made or the metrics underlying the impairment calculation change. An impaired loan may show deficiencies in the borrower’s overall financial condition, payment history, support available from financial guarantors and/or the fair market value of collateral. The historical formula allowance is used to estimate the loss on internally risk-rated loans, exclusive of those identified as impaired. Loans are grouped by type (construction, residential real estate, commercial real estate, commercial or consumer) and similar risk characteristics. Each loan pool is assigned allowance factors based on management’s estimate of the risk, complexity and size of individual loans within a particular category using average historical charge-offs by segment over the last 16 quarters. Loans identified as pass-watch, special mention, substandard, and doubtful are considered to have elevated credit risk. These loans are assigned higher allowance factors than favorably rated loans due to management’s concerns regarding collectability or management’s knowledge of particular elements regarding the borrower. The qualitative formula allowance captures losses that have impacted the portfolio but have yet to be recognized in either the specific or historical formula allowance. A pass-watch loan has adequate risk and may include loans which may have been upgraded from another higher risk category. A special mention loan has potential weaknesses that could result in a future loss to the Company if the weaknesses are realized. A substandard loan has certain deficiencies that could result in a future loss to the Company if these deficiencies are not corrected. A doubtful loan has enough risk that there is a high probability that the Company will sustain a loss. The qualitative formula allowance is used to adjust the historical formula allowance to an amount that is reflective of the probable losses inherent in the loan portfolio. The qualitative formula allowance is established through the evaluation of various qualitative factors which are used to develop loss percentages that are applied to the identified pools of loans that are not individually evaluated for impairment. Management has significant discretion in making the adjustments inherent in the determination of the provision and allowance for credit losses, including the establishment of the allowance factors in the qualitative formula allowance component of the allowance. The establishment of the qualitative factors used in the qualitative formula allowance is a continuing exercise, based on management’s ongoing assessment of the totality of all factors, including, but not limited to, delinquencies, loss history, effects of changes in lending policy, the experience and depth of management, national and local economic trends, concentrations of credit, the quality of the loan review system and the effect of other factors as deemed appropriate, and their impact on the portfolio. Allowance factors may change from period to period, resulting in an increase or decrease in the amount of the provision or allowance, based on the same volume and classification of loans. Changes in allowance factors will have a direct impact on the amount of the provision, and a corresponding effect on net income. Errors in management’s perception and assessment of these factors and their impact on the portfolio could result in the allowance not being adequate to cover losses in the portfolio, and may result in additional provisions or charge-offs. |
Premises and Equipment | Premises and Equipment Land is carried at cost and premises and equipment are stated at cost less accumulated depreciation and amortization. Depreciation and amortization are calculated using the straight-line method over the estimated useful lives of the assets. Useful lives range from three three Long-lived assets are evaluated periodically for impairment when events or changes in circumstances indicate the carrying amount may not be recoverable. Impairment exists when the expected undiscounted future cash flows of a long-lived asset are less than its carrying value. In that event, the Company recognizes a loss for the difference between the carrying amount and the estimated fair value of the asset. |
Mergers and Acquisitions | Mergers and Acquisitions Business combinations are accounted for under ASC 805, Business Combinations, using the acquisition method of accounting. The acquisition method of accounting requires an acquirer to recognize the assets acquired and the liabilities assumed at the acquisition date measured at their fair values as of that date. To determine the fair values, the Company relies on internal or third-party valuations, such as appraisals, valuations based on discounted cash flow analyses, or other valuation techniques. Under the acquisition method of accounting, the Company identifies the acquirer and the closing date and applies applicable recognition principles and conditions. Acquisition-related costs are costs the Company incurs to effect a business combination. Those costs include advisory, legal, accounting, valuation, and other professional or consulting fees. Some other examples of costs to the Company include systems conversions, integration planning consultants and advertising costs. The Company accounts for acquisition-related costs as expenses in the periods in which the costs are incurred and the services are received, with one exception. The costs to issue debt or equity securities is recognized in accordance with other applicable GAAP. These acquisition-related costs have been and will be included within the consolidated statements of income classified within the noninterest expenses caption. |
Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets Goodwill represents the excess of the cost of an acquisition over the fair value of the net assets acquired. Other intangible assets represent purchased assets that also lack physical substance but can be distinguished from goodwill because of contractual or other legal rights or because the asset is capable of being sold or exchanged either on its own or in combination with a related contract, asset or liability. Goodwill and other intangible assets are initially required to be recorded at fair value. Determining fair value is subjective, requiring the use of estimates, assumptions and management judgment. Goodwill is tested at least annually for impairment, usually during the fourth quarter, or on an interim basis if circumstances dictate. Intangible assets that have finite lives are amortized over their estimated useful lives and also are subject to impairment testing. If the fair value of a reporting unit is less than book value, an expense may be required to write down the related goodwill to record an impairment loss. As of December 31, 2022, the Company had two operating segments the Community Banking segment and Mortgage Banking segment. Other intangible assets consist of core deposit intangible assets arising from whole bank and branch acquisitions and are amortized using an accelerated method over their estimated useful lives, which range from 7 to 10 years. During 2022 and 2021, goodwill and other intangible assets were subjected to assessments for impairment. No impairment charges were recognized in either year. Our assessment of goodwill concluded it was not more likely that not that the fair value of the Company's reporting units were less than their carrying amount. |
Other Real Estate Owned | Other Real Estate Owned Other real estate owned represents assets acquired in satisfaction of loans either by foreclosure or deeds taken in lieu of foreclosure. Properties acquired are recorded at fair value less estimated selling costs at the time of acquisition, establishing a new cost basis. Thereafter, costs incurred to operate or carry the properties as well as reductions in value as determined by periodic appraisals are charged to operating expense. Gains and losses resulting from the final disposition of the properties are included in noninterest expense. |
Borrowings and Subordinated Debt | Borrowings Short-term and long-term borrowings are comprised primarily of FHLB borrowings. The Company’s short-term borrowings may also include advances on other lines of credit with correspondent banks or re-purchase agreements with customers. The repurchase agreements are securities sold to the Company’s customers, at the customers’ request, under a continuing “roll-over” contract that matures in one business day. The underlying securities sold are U.S. Government agency securities, which are segregated from the Company’s other investment securities by its safekeeping agents. Subordinated Debt Subordinated debt is carried at its outstanding principal balance, net of any unamortized issuance costs. For additional information on the Company’s subordinated debt, refer to Note 12 of the Consolidated Financial Statements. |
Income Taxes | Income Taxes The Company and its subsidiary file a consolidated federal income tax return. The Company accounts for income taxes using the liability method in accordance with required accounting guidance. Under this method, deferred tax assets and liabilities are determined by applying the applicable federal and state income tax rates to cumulative temporary differences. These temporary differences represent differences between financial statement carrying amounts and the corresponding tax bases of certain assets and liabilities. Deferred taxes result from such temporary differences. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the period that includes the enactment date. A valuation allowance, if needed, reduces deferred tax assets to the expected amount most likely to be realized. Realization of deferred tax assets is dependent on the generation of a sufficient level of future taxable income, recoverable taxes paid in prior years and tax planning strategies. The Company evaluates all positive and negative evidence before determining if a valuation allowance is deemed necessary regarding the realization of deferred tax assets. The Company recognizes accrued interest and penalties as a component of tax expense. The provision for income taxes includes the impact of reserve provisions and changes in the reserves that are considered appropriate as well as the related net interest and penalties. In addition, the Company is subject to the continuous examination of its income tax returns by the IRS and other tax authorities which may assert assessments against the Company. The Company regularly assesses the likelihood of adverse outcomes resulting from these examinations and assessments to determine the adequacy of its provision for income taxes. The Company remains subject to examination for tax years ending on or after December 31, 2019. |
Derivative Financial Instruments and Hedging | Derivative Financial Instruments and Hedging We account for derivatives in accordance with FASB literature on accounting for derivative instruments and hedging activities. When we enter into a derivative contract, we designate the derivative as held for trading, an economic hedge, or a qualifying hedge as detailed in the literature. The designation may change based upon management’s reassessment or changing circumstances. Derivatives utilized by the Company include interest rate lock commitments (“IRLC”) or (“IRLCs”) and forward settlement contracts. IRLCs occur when we originate mortgage loans with interest rates determined prior to funding. Forward settlement contracts are agreements to buy or sell a quantity of a financial instrument, index, currency, or commodity at a predetermined future date, rate, or price. We designate at inception whether a derivative contract is considered hedging or non-hedging. All of our derivatives are nonexchange traded contracts, and as such, their fair value is based on dealer quotes, pricing models, discounted cash flow methodologies, or similar techniques for which the determination of fair value may require significant management judgement or estimation. For qualifying hedges, we formally document at inception all relationships between hedging instruments and hedged items, as well as risk management objectives and strategies for undertaking various accounting hedges. We primarily utilize derivatives to manage interest rate sensitivity., At December 31, 2022 and 2021 we did not have any designated hedges. |
Basic and Diluted Earnings Per Common Share | Basic and Diluted Earnings Per Common Share Basic earnings per share is calculated by dividing net income available to common stockholders by the weighted-average number of common shares outstanding and does not include the effect of any potentially dilutive common stock equivalents. Included in this calculation due to dividend participation rights are restricted stock awards which have been granted. Diluted earnings per share is calculated by dividing net income by the weighted-average number of shares outstanding, adjusted for the effect of any potentially dilutive common stock equivalents. |
Transfers of Financial Assets | Transfers of Financial Assets Transfers of financial assets are accounted for as sales, when control over the assets has been surrendered. Control over transferred assets is deemed to be surrendered when (i) the assets have been isolated from the Company, (ii) the transferee obtains the right (free of conditions that constrain it from taking advantage of that right) to pledge or exchange the transferred assets, and (iii) the Company does not maintain effective control over the transferred assets through an agreement to repurchase them before their maturity. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and due from banks, interest-bearing deposits with other banks and federal funds sold are considered “cash and cash equivalents” for financial reporting purposes. Certain interest-bearing deposits with banks may exceed balances that are recoverable under Federal Deposit Insurance (“FDIC”) insurance. Balances in excess of FDIC insurance at December 31, 2022 were approximately $1.8 million. |
Share-Based Compensation | Share-Based Compensation The Company may grant share-based compensation to employees and non-employee directors in the form of restricted stock, restricted stock units and stock options. The fair value of restricted stock is determined based on the closing price of the Parent’s common stock on the date of grant. The Company recognizes compensation expense related to restricted stock on a straight-line basis over the vesting period for service-based awards. The fair value of RSUs is initially valued based on the closing price of the Parent’s common stock on the date of grant and is amortized in the statement of income over the vesting period. The RSUs are subsequently remeasured in each reporting period until settlement based on the quantity of awards for which it is probable that the performance conditions will be achieved. The fair value of stock options is estimated at the date of grant using the Black-Scholes option pricing model and related assumptions. The Company uses historical data to predict option exercise and employee termination behavior. Expected volatilities are based on the historical volatility of the Parent’s common stock. The expected term of options granted is derived from actual historical exercise activity and represents the period of time that options granted are expected to be outstanding. The risk-free rate is derived from the U.S. Treasury yield curve in effect at the time of grant based on the expected life of the option. The dividend yield is equal to the dividend yield of the Parent’s common stock at the time of grant. Expense related to stock options is recorded in the statements of income as a component of salaries and benefits for employees and as a component of other noninterest expense for non-employee directors, with a corresponding increase to capital surplus in shareholders’ equity. |
Fair Value | Fair Value The Company measures certain financial assets and liabilities at fair value and also makes disclosures about certain financial instruments that are not measured at fair value in the Consolidated Balance Sheets. Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Fair value estimates involve uncertainties and matters of significant judgement regarding interest rates, credit risk, and other factors, particularly in the absence of broad markets for specific terms. Changes in assumptions or in market conditions could significantly affect these estimates. See Note 22 for a further discussion of fair value. |
Advertising Costs | Advertising Costs Advertising costs are generally expensed as incurred. The Company incurred advertising costs of approximately $898 thousand for the year ended December 31, 2022 and $339 thousand for the year ended December 31, 2021. |
Comprehensive Income | Comprehensive Income Comprehensive income consists of net income and other comprehensive income (loss). Other comprehensive income (loss) consists of unrealized gains and losses on available-for-sale securities net of any gains recognized from the sale of available-for-sale securities. There were no reclassifications from accumulated other comprehensive income in 2022 and 2021. |
Recent Accounting Standards and Other Authoritative Guidance | Recent Accounting Standards and Other Authoritative Guidance ASU No. 2016-13 During June 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2016-13, “Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments.” The ASU, as amended, requires an entity to measure expected credit losses for financial assets carried at amortized cost based on historical experience, current conditions, and reasonable and supportable forecasts. Among other things, the ASU also amended the impairment model for available for sale securities and addressed purchased financial assets with deterioration. The Company adopted ASU 2016-13 as of January 1, 2023 in accordance with the required implementation date. Transition adjustments during the first quarter of 2023, will primarily include increases in the allowance for credit losses on loans and the reserve for credit losses on unfunded commitments to extend credit as well as a reduction of total equity, net of taxes. This reduction of equity capital may, at the Company’s election, be phased-in over a three-year period in accordance with regulatory guidelines. The final cumulative effect of the transition adjustments remains subject to completion by the Company but is estimated to reduce opening retained earnings in January 1, 2023 by a reasonable range of $7 million to $9 million. Subsequent to adoption, the Company will record adjustments to its allowance and reserve for unfunded commitments by recognizing a provision for credit losses in the consolidated statements of income. The Company is utilizing a third-party model to tabulate its estimate of current expected credit losses, using a DCF methodology. In accordance with ASC 326, the Company has segmented its loan portfolio based on similar risk characteristics which included types of collateral, use, lien position, secured and unsecured lending, purchased portfolios and risk rating. The Company primarily utilizes a published unemployment rate forecast in its reasonable and supportable forecasting of current expected credit losses. To further adjust the allowance for credit losses for expected losses not already included within the quantitative component of the calculation, the Company may consider the following qualitative adjustment factors: underwriting standards, national, regional and local economic conditions, experience and depth of lending staff, past due loans, the strength of the credit review function, the value of underlying collateral, concentrations of credit, and other factors as deemed appropriate by management. The Company’s CECL implementation process was overseen by a CECL Implementation Committee and included an assessment of data availability and gap analysis, data collection, consideration and analysis of multiple loss estimation methodologies, an assessment of relevant qualitative factors and correlation analysis of multiple potential loss drivers and their impact on the Company’s historical loss experience. During 2022, the Company calculated its current expected credit losses model in parallel to its incurred loss model in order to further refine the methodology and model. In addition, the Company engaged a third-party audit firm to perform a comprehensive model validation. Effective November 25, 2019, the SEC adopted Staff Accounting Bulletin (SAB) 119. SAB 119 updated portions of SEC interpretative guidance to align with FASB ASC 326, “Financial Instruments – Credit Losses.” It covers topics including (1) measuring current expected credit losses; (2) development, governance, and documentation of a systematic methodology; (3) documenting the results of a systematic methodology; and (4) validating a systematic methodology. ASU No. 2022-02 – In March 2022, the (FASB) issued (ASU) No. 2022-02, “Financial Instruments-Credit Losses (Topic 326), Troubled Debt Restructurings and Vintage Disclosures.” ASU 2022-02 addresses areas identified by the FASB as part of its post-implementation review of the credit losses standard (ASU 2016-13) that introduced the CECL model. The amendments eliminate the accounting guidance for troubled debt restructurings by creditors that have adopted the CECL model and enhance the disclosure requirements for loan refinancing’s and restructurings made with borrowers experiencing financial difficulty. In addition, the amendments require a public business entity to disclose current-period gross write-offs for financing receivables and net investment in leases by year of origination in the vintage disclosures. The amendments in this ASU should be applied prospectively, except for the transition method related to the recognition and measurement of troubled debt restructurings (TDR), an entity has the option to apply a modified retrospective transition method, resulting in a cumulative-effect adjustment to retained earnings in the period of adoption. For entities that have adopted ASU 2016-13, ASU 2022-02 is effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. The Company is currently assessing the impact that ASU 2022-02 will have on its consolidated financial statements. ASU No. 2022-03 - In June 2022, the (FASB) issued (ASU) No. 2022-03, “Fair Value Measurement (Topic 820): Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions”. ASU 2022-03 clarifies that a contractual restriction on the sale of an equity security is not considered part of the unit of account of the equity security and, therefore, is not considered in measuring fair value. The ASU is effective for fiscal years, including interim periods within those fiscal years, beginning after December 15, 2023. Early adoption is permitted. The Company does not expect the adoption of ASU 2022-03 to have a material impact on its consolidated financial statements. ASU No. 2020-04 – In March 2020, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2020-04 “Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting.” These amendments provide temporary optional guidance to ease the potential burden in accounting for reference rate reform. The ASU provides optional expedients and exceptions for applying generally accepted accounting principles to contract modifications and hedging relationships, subject to meeting certain criteria, that reference the London Inter-bank Offered Rate (“LIBOR”) or another reference rate expected to be discontinued. It is intended to help stakeholders during the global market-wide reference rate transition period. The guidance is effective for all entities as of March 12, 2020 through December 31, 2022. Subsequently, in January 2021, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2021-01 “Reference Rate Reform (Topic 848): Scope.” This ASU clarifies that certain optional expedients and exceptions in Topic 848 for contract modifications and hedge accounting apply to derivatives that are affected by the discounting transition. The ASU also amends the expedients and exceptions in Topic 848 to capture the incremental consequences of the scope clarification and to tailor the existing guidance to derivative instruments affected by the discounting transition. An entity may elect to apply ASU No. 2021-01 on contract modifications that change the interest rate used for margining, discounting, or contract price alignment retrospectively as of any date from the beginning of the interim period that includes March 12, 2020, or prospectively to new modifications from any date within the interim period that includes or is subsequent to January 7, 2021, up to the date that financial statements are available to be issued. An entity may elect to apply ASU No. 2021-01 to eligible hedging relationships existing as of the beginning of the interim period that includes March 12, 2020, and to new eligible hedging relationships entered into after the beginning of the interim period that includes March 12, 2020. At present, the Bank has limited exposure to LIBOR based pricing. LIBOR based loans only comprise 16 loans or 3.1% of the loan portfolio. The Bank is confident it can successfully negotiate a migration to the Secured Overnight Financing Rate (“SOFR”) between now and the implementation date. The Bank will notify customers within 120 days prior to migration to SOFR. The Bank acknowledges the replacement rate will be more volatile based on different countries migrating to different indexes and limited liquidity to support the rate. The Bank further acknowledges the volatility will be greatly influenced by the support provided by the Federal Reserve. |
Business Combination (Tables)
Business Combination (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Business Combination [Abstract] | |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | (In thousands, except per share data) Purchase Price Consideration: Fair value of common shares issued (8,053,088 shares) based on Shore Bancshares, Inc. share price of $18.48 $ 148,821 Cash consideration 20,631 Cash paid for cash-out Severn stock options 310 Cash for fractional shares 3 Total purchase price $ 169,765 Identifiable assets: Cash and cash equivalents $ 326,725 Total securities 146,292 Loans held for sale 9,613 Loans, net (1) 584,776 Premises and equipment, net 24,768 Other real estate owned 329 Core deposit intangible asset 6,550 Other assets (1) 20,319 Total identifiable assets $ 1,119,372 Identifiable liabilities: Deposits $ 955,288 Total debt 28,341 Other liabilities 11,727 Total identifiable liabilities $ 995,356 Fair value of net assets acquired including identifiable intangible assets 124,016 Resulting goodwill (1) $ 45,749 (1) Includes the effect of measurement period adjustments recorded during 2022 and reconciled in the table below. Measurement period adjustments included adjustments related to loan validations and the final accounting for the income taxes of Severn. |
Schedule of Changes in Fair Value of Assets Acquired and Liabilities Assumed | Goodwill at December 31, 2021 $ 45,904 Effect of measurement period adjustments to: Loans, net (192) Other assets 37 Goodwill at December 31, 2022 $ 45,749 |
Schedule of Contractually Required Payments Receivable | Contractually required payments receivable $ 46,833 Nonaccretable difference (3,364) Cash flows expected to be collected 43,469 Accretable yield (5,667) Fair value $ 37,802 |
Investment Securities (Tables)
Investment Securities (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Investment Securities [Abstract] | |
Schedule of Available-for-Sale Securities Reconciliation | Gross Gross Estimated Amortized Unrealized Unrealized Fair (Dollars in thousands) Cost Gains Losses Value Available-for-sale securities: December 31, 2022 U.S. Government agencies $ 21,798 $ 5 $ 3,625 $ 18,178 Mortgage-backed 72,183 2 8,666 63,519 Otherd debt securities 2,018 — 128 1,890 Total $ 95,999 $ 7 $ 12,419 $ 83,587 December 31, 2021 U.S. Government agencies $ 22,932 $ 7 $ 634 $ 22,305 Mortgage-backed 91,948 1,318 629 92,637 Other debt securities 2,026 14 — 2,040 Total $ 116,906 $ 1,339 $ 1,263 $ 116,982 |
Schedule of Held-to-Maturity | Gross Gross Estimated Amortized Unrealized Unrealized Fair (Dollars in thousands) Cost Gains Losses Value Held-to-maturity securities: December 31, 2022 U.S. Government agencies $ 148,097 $ — $ 13,601 $ 134,496 Mortgage-backed 398,884 — 50,464 348,420 States and political subdivisions 1,474 35 28 1,481 Other debt securities 11,000 — 770 10,230 Total $ 559,455 $ 35 $ 64,863 $ 494,627 December 31, 2021 U.S. Government agencies $ 87,072 $ 20 $ 1,231 $ 85,861 Mortgage-backed 302,604 301 2,248 300,657 States and political subdivisions 400 2 — 402 Other debt securities 14,518 95 9 14,604 Total $ 404,594 $ 418 $ 3,488 $ 401,524 |
Available-For-Sale Securities and Held-to-Maturity, Continuous Unrealized Loss Position, Fair Value | Less than More than 12 Months 12 Months Total Fair Unrealized Fair Unrealized Fair Unrealized (Dollars in thousands) Value Losses Value Losses Value Losses December 31, 2022 Available-for-sale securities: U.S. Government agencies $ 1,165 $ 4 $ 16,585 $ 3,588 $ 17,750 $ 3,592 Mortgage-backed 29,125 2,409 34,167 6,290 63,292 8,699 Other debt securities 1,890 128 — — 1,890 128 Total $ 32,180 $ 2,541 $ 50,752 $ 9,878 $ 82,932 $ 12,419 Held-to-maturity securities: U.S. Government agencies $ 67,332 $ 2,786 $ 67,163 $ 10,815 $ 134,495 $ 13,601 Mortgage-backed 148,771 9,402 199,649 41,062 348,420 50,464 States and political subdivisions 780 28 — — 780 28 Other debt securities 8,091 409 2,139 361 10,230 770 Total $ 224,974 $ 12,625 $ 268,951 $ 52,238 $ 493,925 $ 64,863 Less than More than 12 Months 12 Months Total Fair Unrealized Fair Unrealized Fair Unrealized (Dollars in thousands) Value Losses Value Losses Value Losses December 31, 2021 Available-for-sale securities: U.S. Government agencies $ 1,561 $ 1 $ 17,368 $ 633 $ 18,929 $ 634 Mortgage-backed 39,851 593 3,562 36 43,413 629 Total $ 41,412 $ 594 $ 20,930 $ 669 $ 62,342 $ 1,263 Held-to-maturity securities: U.S. Government agencies $ 64,268 $ 1,005 $ 11,719 $ 226 $ 75,987 $ 1,231 Mortgage-backed 226,918 1,836 14,564 412 241,482 2,248 Other debt securities 491 9 — — 491 9 Total $ 291,677 $ 2,850 $ 26,283 $ 638 $ 317,960 $ 3,488 |
Schedule of Securities Debt Maturities | Available for sale Held to maturity Amortized Amortized (Dollars in thousands) Cost Fair Value Cost Fair Value Due in one year or less $ 75 $ 74 $ 2,117 $ 2,076 Due after one year through five years 6,658 6,351 108,632 101,165 Due after five years through ten years 42,689 37,856 73,054 66,502 Due after ten years 46,577 39,306 375,652 324,884 Total $ 95,999 $ 83,587 $ 559,455 $ 494,627 |
Amortized Cost and Estimated Fair Values of Securities | 2022 2021 Amortized Amortized (Dollars in thousands) Cost Fair Value Cost Fair Value Pledged available-for-sale securities $ 83,288 72,108 $ 78,522 $ 78,352 Pledged held to maturity securities 19,158 16,305 913 915 |
Loans and Allowance for Credi_2
Loans and Allowance for Credit Losses (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Receivables [Abstract] | |
Schedule of Financing Receivables | (Dollars in thousands) 2022 2021 Construction $ 246,319 $ 239,353 Residential real estate 810,497 654,769 Commercial real estate 1,065,409 896,229 Commercial 147,856 203,377 Consumer 286,026 125,447 Total loans (1) 2,556,107 2,119,175 Allowance for credit losses (16,643) (13,944) Total loans, net $ 2,539,464 $ 2,105,231 (1) Includes net origination costs totaling $1.4 million and $1.2 million as of December 31, 2022 and 2021, respectively. |
Schedule of loans acquired from Severn | December 31, 2022 Acquired Loans - Acquired Loans - Purchased Purchased Acquired Loans - (Dollars in thousands) Credit Impaired Performing Total Outstanding principal balance $ 29,620 $ 349,262 $ 378,882 Carrying amount Construction $ 650 $ 18,761 $ 19,411 Residential real estate 13,956 116,118 130,074 Commercial real estate 11,866 174,278 186,144 Commercial 156 35,687 35,843 Consumer 14 697 711 Total loans $ 26,642 $ 345,541 $ 372,183 December 31, 2021 Acquired Loans - Acquired Loans - Purchased Purchased Acquired Loans - (Dollars in thousands) Credit Impaired Performing Total Outstanding principal balance $ 36,943 $ 524,474 $ 561,417 Carrying amount Construction $ 2,379 $ 91,823 $ 94,202 Residential real estate 17,326 167,580 184,906 Commercial real estate 13,594 202,819 216,413 Commercial 321 56,200 56,521 Consumer 30 921 951 Total loans $ 33,650 $ 519,343 $ 552,993 |
Schedule of PCI loans acquired | For the Year Ended (Dollars in thousands) December 31, 2022 Accretable yield, beginning of period $ 5,367 Accretion (1,603) Reclassification of nonaccretable difference due to improvement in expected cash flows 469 Other changes, net 506 Accretable yield, end of period $ 4,739 |
Allowance for Credit Losses on Financing Receivables | Residential Commercial (Dollars in thousands) Construction real estate real estate Commercial Consumer Total December 31, 2022 Loans individually evaluated for impairment $ 331 $ 5,081 $ 2,540 $ 174 $ 28 $ 8,154 Loans collectively evaluated for impairment 236,901 791,460 1,051,003 147,526 285,984 2,512,874 Acquired loans - PCI 650 13,956 11,866 156 14 26,642 Total loans (1) $ 237,882 $ 810,497 $ 1,065,409 $ 147,856 $ 286,026 $ 2,547,670 Allowance for credit losses allocated to: Loans individually evaluated for impairment $ — $ 127 $ — $ — $ — $ 127 Loans collectively evaluated for impairment 2,973 2,495 4,899 1,652 4,497 16,516 Total allowance $ 2,973 $ 2,622 $ 4,899 $ 1,652 $ 4,497 $ 16,643 (1) Excludes loans measured at fair value of $8.4 million at December 31, 2022. Residential Commercial (Dollars in thousands) Construction real estate real estate Commercial Consumer Total December 31, 2021 Loans individually evaluated for impairment $ 321 $ 3,717 $ 3,833 $ 226 $ — $ 8,097 Loans collectively evaluated for impairment 236,653 633,726 878,802 202,830 125,417 2,077,428 Acquired loans - PCI 2,379 17,326 13,594 321 30 33,650 Total loans $ 239,353 $ 654,769 $ 896,229 $ 203,377 $ 125,447 $ 2,119,175 Allowance for credit losses allocated to: Loans individually evaluated for impairment $ — $ 172 $ 1 $ — $ — $ 173 Loans collectively evaluated for impairment 2,454 2,686 4,597 2,070 1,964 13,771 Acquired loans - PCI — — — — — — Total allowance $ 2,454 $ 2,858 $ 4,598 $ 2,070 $ 1,964 $ 13,944 |
Impaired Financing Receivables | Recorded Recorded Unpaid investment investment Year-to-date Interest principal with no with an Related average recorded income (Dollars in thousands) balance allowance allowance allowance investment recognized December 31, 2022 Impaired nonaccrual loans: Construction $ 297 $ 297 $ — $ — $ 309 $ — Residential real estate 1,363 1,259 — — 1,661 — Commercial real estate 159 150 — — 604 — Commercial 359 174 — — 227 — Consumer 29 28 — — 43 — Total $ 2,207 $ 1,908 $ — $ — $ 2,844 $ — Impaired accruing TDRs: Construction $ 10 $ 10 $ — $ — $ 16 $ 1 Residential real estate 2,849 1,176 1,539 127 2,979 108 Commercial real estate 1,680 1,680 — — 2,095 56 Commercial — — — — — — Consumer — — — — 5 — Total $ 4,539 $ 2,866 $ 1,539 $ 127 $ 5,095 $ 165 Other impaired accruing loans: Construction $ 24 $ 24 $ — $ — $ 215 $ 6 Residential real estate 1,107 1,107 — — 474 3 Commercial real estate 710 710 — — 553 30 Commercial — — — — 51 1 Consumer — — — — 15 — Total $ 1,841 $ 1,841 $ — $ — $ 1,308 $ 40 Total impaired loans: Construction $ 331 $ 331 $ — $ — $ 540 $ 7 Residential real estate 5,319 3,542 1,539 127 5,114 111 Commercial real estate 2,549 2,540 — — 3,252 86 Commercial 359 174 — — 278 1 Consumer 29 28 — — 63 — Total $ 8,587 $ 6,615 $ 1,539 $ 127 $ 9,247 $ 205 Recorded Recorded Unpaid investment investment Year-to-date Interest principal with no with an Related average recorded income (Dollars in thousands) balance allowance allowance allowance investment recognized December 31, 2021 Impaired nonaccrual loans: Construction $ 297 $ 297 $ — $ — $ 297 $ — Residential real estate 882 803 — — 1,095 — Commercial real estate 994 606 — — 2,122 — Commercial 380 216 — — 242 — Consumer — — — — 9 — Total $ 2,553 $ 1,922 $ — $ — $ 3,765 $ — Impaired accruing TDRs: Construction $ 24 $ 24 $ — $ — $ 30 $ 3 Residential real estate 2,965 475 2,361 172 3,150 146 Commercial real estate 2,807 2,352 455 1 2,952 87 Commercial — — — — — — Consumer — — — — — — Total $ 5,796 $ 2,851 $ 2,816 $ 173 $ 6,132 $ 236 Other impaired accruing loans: Construction $ — $ — $ — $ — $ — $ — Residential real estate 78 78 — — 465 21 Commercial real estate 420 420 — — 470 17 Commercial 10 10 — — 13 — Consumer — — — — — — Total $ 508 $ 508 $ — $ — $ 948 $ 38 Total impaired loans: Construction $ 321 $ 321 $ — $ — $ 327 $ 3 Residential real estate 3,925 1,356 2,361 172 4,710 167 Commercial real estate 4,221 3,378 455 1 5,544 104 Commercial 390 226 — — 255 — Consumer — — — — 9 — Total $ 8,857 $ 5,281 $ 2,816 $ 173 $ 10,845 $ 274 |
Troubled Debt Restructurings on Financing Receivables | 1/1/2022 12/31/2022 TDR New Disbursements Charge- Reclassifications/ TDR Related (Dollars in thousands) Balance TDRs (Payments) offs Transfer In/(Out) Payoffs Balance Allowance For the Year Ended December 31, 2022 Accruing TDRs Construction $ 24 $ — $ (14) $ — $ — $ — $ 10 $ — Residential real estate 2,836 — (100) — (20) (1) 2,715 127 Commercial real estate 2,807 — (180) — — (947) 1,680 — Commercial — — — — — — — — Consumer — — — — — — — — Total $ 5,667 $ — $ (294) $ — $ (20) $ (948) $ 4,405 $ 127 Nonaccrual TDRs Construction $ — $ — $ — $ — $ — $ — $ — $ — Residential real estate — — (6) — 20 — 14 — Commercial real estate — — — — — — — — Commercial 216 — (46) — — — 170 — Consumer — — — — — — — — Total $ 216 $ — $ (52) $ — $ 20 $ — $ 184 $ — Total $ 5,883 $ — $ (346) $ — $ — $ (948) $ 4,589 $ 127 1/1/2021 12/31/2021 TDR New Disbursements Charge- Reclassifications/ TDR Related (Dollars in thousands) Balance TDRs (Payments) offs Transfer In/(Out) Payoffs Balance Allowance For the Year Ended December 31, 2021 Accruing TDRs Construction $ 34 $ — $ (10) $ — $ — $ — $ 24 $ — Residential real estate 3,845 — (109) — — (900) 2,836 172 Commercial real estate 3,118 — (311) — — — 2,807 1 Commercial — — — — — — — — Consumer — — — — — — — — Total $ 6,997 $ — $ (430) $ — $ — $ (900) $ 5,667 $ 173 Nonaccrual TDRs Construction $ — $ — $ — $ — $ — $ — $ — $ — Residential real estate — — — — — — — — Commercial real estate — — — — — — — — Commercial 258 — (42) — — — 216 — Consumer — — — — — — — — Total $ 258 $ — $ (42) $ — $ — $ — $ 216 $ — Total $ 7,255 $ — $ (472) $ — $ — $ (900) $ 5,883 $ 173 |
Financing Receivable Credit Quality Indicators | Special (Dollars in thousands) Pass/Performing (1) Pass/Watch Mention Substandard Doubtful PCI Total December 31, 2022 Construction $ 231,160 $ 14,212 $ — $ 297 $ — $ 650 $ 246,319 Residential real estate 761,405 32,467 1,239 1,430 — 13,956 810,497 Commercial real estate 929,501 121,711 1,814 517 — 11,866 1,065,409 Commercial 131,084 15,958 484 174 — 156 147,856 Consumer 285,786 196 2 28 — 14 286,026 Total $ 2,338,936 $ 184,544 $ 3,539 $ 2,446 $ — $ 26,642 $ 2,556,107 (1) Includes loans measured at fair value of $8.4 million at December 31, 2022. Special (Dollars in thousands) Pass/Performing Pass/Watch Mention Substandard Doubtful PCI Total December 31, 2021 Construction $ 210,287 $ 24,513 $ 1,877 $ 297 $ — $ 2,379 $ 239,353 Residential real estate 596,694 38,309 1,539 901 — 17,326 654,769 Commercial real estate 724,561 151,209 4,535 2,330 — 13,594 896,229 Commercial 186,176 16,654 — 226 — 321 203,377 Consumer 125,200 215 — 2 — 30 125,447 Total $ 1,842,918 $ 230,900 $ 7,951 $ 3,756 $ — $ 33,650 $ 2,119,175 |
Past Due Financing Receivables | Accruing 30‑59 days 60‑89 days Greater than Total (Dollars in thousands) Current (1) past due past due 90 days past due Nonaccrual PCI Total December 31, 2022 Construction $ 239,990 $ 4,343 $ 1,015 $ 24 $ 5,382 $ 297 $ 650 $ 246,319 Residential real estate 787,070 6,214 891 1,107 8,212 1,259 13,956 810,497 Commercial real estate 1,052,314 369 — 710 1,079 150 11,866 1,065,409 Commercial 147,511 15 — — 15 174 156 147,856 Consumer 285,750 223 11 — 234 28 14 286,026 Total $ 2,512,635 $ 11,164 $ 1,917 $ 1,841 $ 14,922 $ 1,908 $ 26,642 $ 2,556,107 Percent of total loans 98.3 % 0.4 % 0.1 % 0.1 % 0.6 % 0.1 % 1.0 % 100.0 % (1) Includes loans measured at fair value of $8.4 million at December 31, 2022. Accruing 30‑59 days 60‑89 days Greater than Total (Dollars in thousands) Current past due past due 90 days past due Nonaccrual PCI Total December 31, 2021 Construction $ 235,757 $ 920 $ — $ — $ 920 $ 297 $ 2,379 $ 239,353 Residential real estate 635,166 1,371 25 78 1,474 803 17,326 654,769 Commercial real estate 881,350 259 — 420 679 606 13,594 896,229 Commercial 202,503 183 62 10 255 298 321 203,377 Consumer 125,130 287 — — 287 — 30 125,447 Total $ 2,079,906 $ 3,020 $ 87 $ 508 $ 3,615 $ 2,004 $ 33,650 $ 2,119,175 Percent of total loans 98.2 % 0.1 % — % — % 0.1 % 0.1 % 1.6 % 100.0 % |
Consolidated Allowance for Credit Losses on Financing Receivables | Residential Commercial (Dollars in thousands) Construction real estate real estate Commercial Consumer Total For the year ended December 31, 2022 Allowance for credit losses: Beginning Balance $ 2,454 $ 2,858 $ 4,598 $ 2,070 $ 1,964 $ 13,944 Charge-offs — (5) (6) (546) (31) (588) Recoveries 13 142 951 227 29 1,362 Net (charge-offs) recoveries 13 137 945 (319) (2) 774 Provision 506 (373) (644) (99) 2,535 1,925 Ending Balance $ 2,973 $ 2,622 $ 4,899 $ 1,652 $ 4,497 $ 16,643 Residential Commercial (Dollars in thousands) Construction real estate real estate Commercial Consumer Total For the year ended December 31, 2021 Allowance for credit losses: Beginning Balance $ 2,022 $ 3,699 $ 5,426 $ 2,089 $ 652 $ 13,888 Charge-offs — — — (235) (28) (263) Recoveries 278 82 114 193 10 677 Net (charge-offs) recoveries 278 82 114 (42) (18) 414 Provision 154 (923) (942) 23 1,330 (358) Ending Balance $ 2,454 $ 2,858 $ 4,598 $ 2,070 $ 1,964 $ 13,944 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Leases [Abstract] | |
Information about leases | (Dollars in thousands) December 31, 2022 December 31, 2021 Lease liabilities $ 9,908 $ 11,567 Right-of-use assets $ 9,629 $ 11,370 Weighted average remaining lease term 12.55 years 13.61 years Weighted average discount rate 2.50 % 2.48 % For the Year Ended Lease cost (in thousands) December 31, 2022 December 31, 2021 Operating lease cost $ 1,355 $ 902 Short-term lease cost — — Total lease cost $ 1,355 $ 902 Cash paid for amounts included in the measurement of lease liabilities $ 1,268 $ 777 |
Operating lease liabilities | As of Lease payments due (in thousands) December 31, 2022 2023 $ 1,231 2024 1,141 2025 917 2026 916 2027 849 Thereafter 6,584 Total undiscounted cash flows $ 11,638 Discount 1,730 Lease liabilities $ 9,908 |
Minimum future annual rental income | As of (In thousands) December 31, 2022 2023 $ 918 2024 701 2025 719 2026 737 2027 418 Thereafter 1,554 Total $ 5,047 |
Premises and Equipment (Tables)
Premises and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Premises and Equipment [Abstract] | |
Schedule of Property Plant and Equipment | The following table provides information on premises and equipment at December 31. (Dollars in thousands) 2022 2021 Land $ 10,886 $ 10,886 Buildings and land improvements 48,605 47,002 Furniture and equipment 8,177 8,467 67,668 66,355 Accumulated depreciation (16,180) (14,731) Total $ 51,488 $ 51,624 |
Goodwill and Other Intangibles
Goodwill and Other Intangibles (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Goodwill and Other Intangible Assets [Abstract] | |
Schedule of Components of Goodwill and Other Acquired Intangible Assets | December 31, 2022 Weighted Gross Measurement Accumulated Net Average Carrying Period Impairment Accumulated Carrying Remaining Life (Dollars in thousands) Amount Adjustments Charges Amortization Amount (in years) Goodwill $ 65,631 $ (155) $ (1,543) $ (667) $ 63,266 — Other intangible assets Amortizable Core deposit intangible $ 10,504 $ — $ — $ (4,957) $ 5,547 2.6 Total other intangible assets $ 10,504 $ — $ — $ (4,957) $ 5,547 December 31, 2021 Weighted Gross Accumulated Net Average Carrying Impairment Accumulated Carrying Remaining Life (Dollars in thousands) Amount Additions Charges Amortization Amount (in years) Goodwill $ 19,727 $ 45,904 $ (1,543) $ (667) $ 63,421 — Other intangible assets Amortizable Core deposit intangible $ 3,954 $ 6,550 $ — $ (2,969) $ 7,535 2.9 Total other intangible assets $ 3,954 $ 6,550 $ — $ (2,969) $ 7,535 |
Future Amortization Expense for Amortizable Other Intangible Assets | (Dollars in thousands) Amortization 2023 $ 1,682 2024 1,376 2025 1,070 2026 765 2027 459 Thereafter 195 Total amortizing intangible assets $ 5,547 |
Other Assets (Tables)
Other Assets (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Other Assets [Abstract] | |
Schedule of Other Assets | (Dollars in thousands) 2022 2021 Accrued interest receivable $ 9,384 $ 6,719 Deferred income taxes 7,357 2,926 Prepaid expenses 2,680 2,865 Income taxes receivable 74 616 Other assets 8,506 6,806 Total $ 28,001 $ 19,932 |
Other Liabilities (Tables)
Other Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Other Liabilities [Abstract] | |
Schedule of Other Liabilities | (Dollars in thousands) 2022 2021 Accrued interest payable $ 989 $ 692 Accrued salaries and wages 1,360 3,422 Accounts payable 353 2,745 Deferred compensation liability 5,679 4,660 Other liabilities 1,846 3,081 Total $ 10,227 $ 14,600 |
Deposits (Tables)
Deposits (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Deposits [Abstract] | |
Schedule of Deposits | The following table provides information on the approximate maturities of total time deposits at December 31. (Dollars in thousands) 2022 2021 Due in one year or less $ 231,089 $ 291,685 Due in one to three years 162,216 128,222 Due in three to five years 31,417 40,044 Total $ 424,722 $ 459,951 |
Borrowings (Tables)
Borrowings (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Borrowings/Subordinated Debt [Abstract] | |
Schedule of Short-term Borrowings | The following table summarizes certain information on short-term borrowings as of and for the years ended December 31. 2022 2021 (Dollars in thousands) Amount Rate Amount Rate Average for the Year Repurchase agreements $ 683 0.25 % $ 3,017 0.25 % FHLB Advances 1,863 3.87 — — Overnight Fed Funds purchased — — — — At Year End Repurchase agreements $ — — % $ 4,143 0.18 % FHLB Advances 40,000 4.57 — — Overnight Fed Funds purchased — — — — |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Stock-Based Compensation [Abstract] | |
Schedule of Stock-Based Compensation | December 31, (Dollars in thousands) 2022 2021 Stock-based compensation expense $ 636 $ 378 Excess tax benefits related to stock-based compensation 42 9 December 31, (Dollars in thousands) 2022 2021 Unrecognized stock-based compensation expense $ 138 $ 80 Weighted average period unrecognized expense is expected to be recognized 0.2 years 0.2 years |
Schedule of Share-based Compensation, Restricted Stock and Units Award Activity | 2022 2021 Weighted Average Weighted Average Number of Grant Date Number of Grant Date Shares Fair Value Shares Fair Value Nonvested at beginning of period 29,425 $ 13.95 24,505 $ 13.78 Granted 34,184 20.48 26,583 13.81 Vested (26,749) 13.75 (20,240) 13.54 Forfeited — — (1,423) 13.34 Nonvested at end of period 36,860 $ 20.15 29,425 $ 13.95 |
Derivatives (Tables)
Derivatives (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Derivative Instruments | The following table provides information pertaining to the carrying amounts of our derivative financial instruments at December 31. December 31, 2022 December 31, 2021 Notional Estimated Notional Estimated (Dollars in thousands) Amount Fair Value Amount Fair Value Asset - IRLCs $ 4,166 $ 35 $ 17,557 $ 380 Asset - TBA securities 8,750 41 26,500 55 Liability - IRLCs 1,150 7 — — Liability - TBA securities 1,000 6 20,500 41 |
Deferred Compensation (Tables)
Deferred Compensation (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Schedule of Deferred Compensation Arrangement | The following table provides information on Shore Bancshares, Inc.’s contributions and participant deferrals to the Plan for 2022 and 2021 and the related deferred compensation liability as of December 31. (Dollars in thousands) 2022 2021 Elective deferrals $ 238 $ 192 Deferred compensation liability 948 972 |
SERP Plan | |
Schedule of Deferred Compensation Arrangement in Other Assets and Other Liabilities | During 2019, the Company introduced a new SERP plan for executive officers of the Company and the Bank. The related liability is unfunded; however, BOLI was purchased to offset the benefit costs. The following table provides information on the expense recognized during the years ended December 31, as well as the balance of the unfunded SERP liability and the cash surrender value of policies purchased to offset the SERP benefit costs as of December 31. The unfunded SERP liability and cash surrender value were included in other liabilities and other assets, respectively. (Dollars in thousands) 2022 2021 Cash surrender value $ 56,117 $ 38,414 Deferred compensation liability - SERP 4,177 3,114 SERP Expense 1,063 1,455 |
Former Directors from CNB [Member] | |
Schedule of Deferred Compensation Arrangement in Other Assets and Other Liabilities | The following table includes information on the deferred compensation liability and cash surrender value as of December 31. (Dollars in thousands) 2022 2021 Deferred compensation liability $ 450 $ 554 Cash surrender value 2,260 2,200 |
Other Expenses (Tables)
Other Expenses (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Other Expenses [Abstract] | |
Schedule of Other Noninterest Expenses | The following table summarizes the Company’s other noninterest expenses for the years ended December 31. (Dollars in thousands) 2022 2021 Advertising and marketing $ 898 $ 339 Other customer expense 1,075 693 Other expense 3,694 2,425 Other loan expense 1,670 188 Software expense 1,853 1,048 Travel and entertainment expense 478 216 Trust professional fees 409 524 Total other noninterest expense $ 10,077 $ 5,433 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Income Taxes [Abstract] | |
Schedule of Components of Income Tax Expense (Benefit) | The following table provides information on components of income tax expense for the years ended December 31. (Dollars in thousands) 2022 2021 Current tax expense: Federal $ 8,814 $ 3,920 State 3,332 1,614 12,146 5,534 Deferred income tax (benefit) expense: Federal (911) 136 State (271) 142 (1,182) 278 Total income tax expense $ 10,964 $ 5,812 |
Schedule of Effective Income Tax Rate Reconciliation | The following table provides a reconciliation of tax computed at the statutory federal tax rate to the actual tax expense for the years ended December 31. 2022 2021 Tax at federal statutory rate 21 % 21 % Tax effect of: Tax-exempt income (1.0) (1.6) State income taxes, net of federal benefit 5.7 6.6 Other 0.3 1.4 Actual income tax expense rate 26.0 % 27.4 % |
Schedule of Deferred Tax Assets and Liabilities | The following table provides information on significant components of the Company’s deferred tax assets and liabilities for the years ended December 31. December 31, December 31, (Dollars in thousands) 2022 2021 Deferred tax assets: Allowance for credit losses $ 4,460 $ 3,728 Write-downs of other real estate owned 21 12 Nonaccrual loan interest 345 253 Lease liabilities 2,635 3,021 Deferred compensation 1,522 1,246 Deferred loan costs 1,183 730 Unrealized losses on available-for-sale securities 3,399 — Other 1,487 903 Total deferred tax assets 15,052 9,893 Less valuation allowance (791) (474) Deferred tax assets, net of valuation allowance 14,261 9,419 Deferred tax liabilities: Depreciation 2,491 1,030 Right-of-use assets 2,560 2,968 Mortgage servicing rights 1,405 1,084 Acquisition accounting adjustments 57 986 Deferred capital gain on branch sale 220 228 Unrealized gains on available-for-sale securities — 13 Other 171 184 Total deferred tax liabilities 6,904 6,493 Net deferred tax assets $ 7,357 $ 2,926 |
Earnings Per Common Share (Tabl
Earnings Per Common Share (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Common Share, Basic and Diluted | For the Year Ended December 31, (In thousands, except per share data) 2022 2021 Net Income $ 31,177 $ 15,368 Weighted average shares outstanding - Basic and Diluted 19,847 13,119 Earnings per common share - Basic and Diluted $ 1.57 $ 1.17 |
Regulatory Capital Requiremen_2
Regulatory Capital Requirements (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Regulatory Capital Requirements [Abstract] | |
Schedule of Capital Amounts And Ratios | The following tables present the capital amounts and ratios at December 31. Common Total Net Tier 1 Total Equity Risk- Risk- Adjusted Common Risk-Based Risk-Based Tier 1 (Dollars in thousands) Tier 1 Tier 1 Based Weighted Average Equity Capital Capital Leverage 2022 Capital Capital Capital Assets Total Assets Tier 1 ratio Ratio Ratio Ratio Shore Bancshares, Inc. $ 304,493 $ 322,891 $ 364,419 $ 2,619,400 $ 3,390,516 11.62 % 12.33 % 13.91 % 9.52 % Shore United Bank, N.A. $ 335,802 $ 335,802 $ 352,657 $ 2,618,939 $ 3,386,771 12.82 % 12.82 % 13.47 % 9.92 % Common Total Net Tier 1 Total Equity Risk- Risk- Adjusted Common Risk-Based Risk-Based Tier 1 (Dollars in thousands) Tier 1 Tier 1 Based Weighted Average Equity Capital Capital Leverage 2021 Capital Capital Capital Assets Total Assets Tier 1 ratio Ratio Ratio Ratio Shore Bancshares, Inc. $ 279,681 $ 279,681 $ 336,696 $ 2,191,557 $ 2,966,412 12.76 % 12.76 % 15.36 % 9.43 % Shore United Bank, N.A. $ 304,362 $ 304,362 $ 318,614 $ 2,189,775 $ 2,965,319 13.90 % 13.90 % 14.55 % 9.48 % |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Income (LOSS) (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Accumulated Other Comprehensive Income [Abstract] | |
Schedule of Accumulated Other Comprehensive Income (Loss) | Unrealized gains (losses) on available for sale (Dollars in thousands) securities Balance, December 31, 2021 $ 56 Other comprehensive (loss) (9,077) Balance, December 31, 2022 $ (9,021) Balance, December 31, 2020 $ 1,529 Other comprehensive (loss) (1,473) Balance, December 31, 2021 $ 56 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Fair Value Measurements [Abstract] | |
Fair Value Assets and Liabilities Measured on Nonrecurring Basis Valuation Techniques | (Dollars in thousands) Fair Value Valuation Technique Unobservable Input Range December 31, 2022 MSRs (1) $ 5,275 Market Approach Weighted average prepayment speed (PSA) (2) 121 IRLCs - net asset $ 28 Market Approach Range of pull through rate 78% - 100% Average pull through rate 92% (Dollars in thousands) Fair Value Valuation Technique Unobservable Input Range December 31, 2021 MSRs (1) $ 4,087 Market Approach Weighted average prepayment speed (PSA) (2) 156 IRLCs - asset $ 380 Market Approach Range of pull through rate 77% - 100% Average pull through rate 93% (1) The weighted average was calculated with reference to the principal balance of the underlying mortgages. (2) PSA = Public Securities Association Standard Prepayment Model |
Schedule of Servicing Asset at Fair Value | The following table presents activity in MSRs for the year ended December 31. For the Year Ended (Dollars in thousands) December 31, 2022 Beginning balance $ 4,087 Servicing rights resulting from sales of loans 816 Valuation adjustment 372 Ending balance $ 5,275 |
Schedule of Derivative Asset at Fair Value | The following table presents activity in the IRLCs for the year ended December 31. For the Year Ended (Dollars in thousands) December 31, 2022 Beginning balance $ 380 Valuation adjustment (352) Ending balance $ 28 |
Schedule of Fair Value of Assets and Liabilities Measured on Recurring Basis | Significant Other Significant Quoted Observable Unobservable Prices Inputs Inputs (Dollars in thousands) Fair Value (Level 1) (Level 2) (Level 3) December 31, 2022 Assets: Securities available for sale: U.S. Government agencies $ 18,178 $ — $ 18,178 $ — Mortgage-backed 63,519 — 63,519 — Other debt securities 1,890 — 1,890 — 83,587 — 83,587 — Equity securities 1,233 — 1,233 — TBA securities 41 — 41 — LHFS 4,248 — 4,248 — LHFI, at fair value 8,437 — 8,437 — MSRs 5,275 — — 5,275 IRLCs 35 — — 35 Total assets at fair value $ 102,856 $ — $ 97,546 $ 5,310 Liabilities: IRLCs $ 7 $ — $ — $ 7 TBA securities 6 — 6 — Total liabilities at fair value $ 13 $ — $ 6 $ 7 Significant Other Significant Quoted Observable Unobservable Prices Inputs Inputs (Dollars in thousands) Fair Value (Level 1) (Level 2) (Level 3) December 31, 2021 Assets: Securities available for sale: U.S. Government agencies $ 22,305 $ — $ 22,305 $ — Mortgage-backed 92,637 — 92,637 — Other debt securities 2,040 — 2,040 — 116,982 — 116,982 — Equity securities 1,372 — 1,372 — TBA securities 55 — 55 — LHFS 37,749 — 37,749 — MSRs 4,087 — — 4,087 IRLCs 380 — — 380 Total assets at fair value $ 160,625 $ — $ 156,158 $ 4,467 Liabilities: TBA securities $ 41 $ — $ 41 $ — Total liabilities at fair value $ 41 $ — $ 41 $ — |
Fair Value of Assets Measured on Nonrecurring Basis | Quantitative Information about Level 3 Fair Value Measurements Weighted (Dollars in thousands) Fair Value Valuation Technique Unobservable Input Range Average (3) December 31, 2022 Nonrecurring measurements: Impaired loans $ 1,412 Discounted cash flow analysis (1) Discount rate 6% - 6.5% (6%) Other real estate owned $ 197 Appraisal of collateral (1) Appraisal adjustments (2) 0% - 20% (2%) Quantitative Information about Level 3 Fair Value Measurements Weighted (Dollars in thousands) Fair Value Valuation Technique Unobservable Input Range Average (3) December 31, 2021 Nonrecurring measurements: Impaired loans $ 617 Appraisal of collateral (1) Liquidation expense (2) 10% (10%) Impaired loans $ 2,026 Discounted cash flow analysis (1) Discount rate 4% - 7.25% (6%) Other real estate owned $ 532 Appraisal of collateral (1) Appraisal adjustments (2) 20% - 40% (35%) (1) Fair value is generally determined through independent appraisals of the underlying collateral (impaired loans and OREO) or discounted cash flow analyses (impaired loans), which generally include various level III inputs which are not observable. (2) Appraisals may be adjusted by management for qualitative factors such as economic conditions and estimated liquidation expenses. The range of liquidation expenses and other appraisal adjustments are presented as a percent of the appraisal. (3) Unobservable inputs were weighted by the relative fair value of the instruments. |
Schedule of Estimated Fair Values of Financial Assets and Liabilities | December 31, 2022 December 31, 2021 Estimated Estimated Carrying Fair Carrying Fair (Dollars in thousands) Amount Value Amount Value Financial assets Level 1 inputs Cash and cash equivalents $ 55,499 $ 55,499 $ 583,613 $ 583,613 Level 2 inputs Investment securities available for sale $ 83,587 $ 83,587 $ 116,982 $ 116,982 Investment securities held to maturity 559,455 494,626 404,594 401,524 Equity securities 1,233 1,233 1,372 1,372 Restricted securities 11,169 11,169 4,159 4,159 LHFS 4,248 4,248 37,749 37,749 TBA securities 41 41 55 55 Cash surrender value on life insurance 59,218 59,218 47,935 47,935 Loans, at fair value 8,437 8,437 — — Level 3 inputs Loans, net $ 2,531,027 $ 2,431,808 $ 2,105,231 $ 2,106,373 MSRs 5,275 5,275 4,087 4,087 IRLCs 35 35 380 380 Financial liabilities Level 2 inputs Deposits: Noninterest-bearing demand $ 862,015 $ 862,015 $ 927,497 $ 927,497 Checking plus interest 694,101 694,101 524,143 524,143 Money market 709,132 709,132 889,099 889,099 Savings 319,814 319,814 225,546 225,546 Club 374 374 388 388 Certificates of deposit 424,348 410,455 459,563 461,135 Securities sold under retail repurchase agreement — — 4,143 4,143 Advances from FHLB - short-term 40,000 40,002 — — Advances from FHLB - long-term — — 10,135 10,187 Subordinated debt 43,072 41,193 42,762 44,876 TBA Securities 6 6 41 41 Level 3 inputs IRLCs 7 7 — — |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Commitments and Contingencies [Abstract] | |
Schedule of Commitments Outstanding | (Dollars in thousands) December 31, 2022 December 31, 2021 Commitments to extend credit $ 406,353 $ 421,088 Letters of credit 8,009 8,399 Total $ 414,362 $ 429,487 |
Segment Reporting (Tables)
Segment Reporting (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information by Segment | Community Consolidated (Dollars in thousands) Banking Mortgage Banking Total For the Year Ended December 31, 2022 Interest Income $ 113,253 $ 592 $ 113,845 Interest Expense 12,501 42 12,543 Net interest income 100,752 550 101,302 Provision for credit losses 1,925 — 1,925 Net interest income after provision for credit losses 98,827 550 99,377 Noninterest income 17,876 5,210 23,086 Noninterest expense 75,267 5,055 80,322 Income before income taxes 41,436 705 42,141 Income tax expense 10,782 182 10,964 Net income $ 30,654 $ 523 $ 31,177 Total assets, December 31, 2022 $ 3,467,548 $ 9,728 $ 3,477,276 Community Consolidated (Dollars in thousands) Banking Mortgage Banking Total For the Year Ended December 31, 2021 Interest Income $ 70,037 $ 132 $ 70,169 Interest Expense 6,031 8 6,039 Net interest income 64,006 124 64,130 Provision for credit losses (358) — (358) Net interest income after provision for credit losses 64,364 124 64,488 Noninterest income 12,550 948 13,498 Noninterest expense 55,628 1,178 56,806 Income (loss) before income taxes 21,286 (106) 21,180 Income tax expense (benefit) 5,841 (29) 5,812 Net income (loss) $ 15,445 $ (77) $ 15,368 Total assets, December 31, 2021 $ 3,416,519 $ 43,617 $ 3,460,136 |
Parent Company Financial Info_2
Parent Company Financial Information (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Parent Company Financial Information [Abstract] | |
Condensed Balance Sheet, Parent Only | (Dollars in thousands) 2022 2021 Assets Cash $ 7,145 $ 13,092 Investment in subsidiaries 396,897 376,453 Other assets 5,392 5,712 Total assets $ 409,434 $ 395,257 Liabilities Accrued interest payable $ 744 $ 551 Other liabilities 1,333 1,251 Long-term debt 43,072 42,762 Total liabilities 45,149 44,564 Stockholders’ equity Common stock 199 198 Additional paid in capital 201,494 200,473 Retained earnings 171,613 149,966 Accumulated other comprehensive (loss) income (9,021) 56 Total stockholders’ equity 364,285 350,693 Total liabilities and stockholders’ equity $ 409,434 $ 395,257 |
Condensed Statement of Operations, Parent Only | (Dollars in thousands) 2022 2021 Income Dividends from subsidiaries $ 5,500 $ 25,000 Company owned life insurance income 67 110 Total income 5,567 25,110 Expenses Interest expense 2,451 1,560 Salaries and employee benefits 324 423 Legal and professional fees 1,654 2,465 Other operating expenses 540 384 Total expenses 4,969 4,832 Income before income tax (benefit) and equity (deficit) in undistributed net income of subsidiaries 598 20,278 Income tax (benefit) (1,059) (990) Income before (deficit) equity in undistributed net income of subsidiaries 1,657 21,268 Equity (deficit) in undistributed net income of subsidiaries 29,520 (5,900) Net income $ 31,177 $ 15,368 |
Condensed Cash Flow, Parent Only | (Dollars in thousands) 2022 2021 Cash flows from operating activities: Net income $ 31,177 $ 15,368 Adjustments to reconcile net income to cash provided by operating activities: (Equity) deficit in undistributed net income of subsidiaries (29,521) 5,900 Amortization of debt issuance costs 122 123 Stock-based compensation expense 636 378 Company owned life insurance income (67) (110) Acquisition accounting adjustments 188 31 Net decrease (increase) in other assets 387 (1,552) Net increase (decrease) increase in other liabilities 275 (142) Net cash provided by operating activities 3,197 19,996 Cash flows from investing activities: Purchase of company owned life insurance — (192) Acquisition of business activity, net of cash paid — (15,945) Net cash (used in) investing activities — (16,137) Cash flows from financing activities: Common stock dividends paid (9,530) (6,607) Retirement of common stock — (819) Issuance of common stock 386 — Exercise of stock options — 6 Net cash (used in) financing activities (9,144) (7,420) Net (decrease) in cash and cash equivalents (5,947) (3,561) Cash and cash equivalents at beginning of year 13,092 16,653 Cash and cash equivalents at end of year $ 7,145 $ 13,092 |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Revenue Recognition [Abstract] | |
Schedule Of Noninterest Income, Segregated By Revenue Streams In-Scope And Out-Of-Scope Of Topic 606 | December 31, (Dollars in thousands) 2022 2021 Noninterest Income In-scope of Topic 606: Service charges on deposit accounts $ 5,652 $ 3,396 Trust and investment fee income 1,784 1,881 Interchange income 4,812 3,964 Title Company revenue 1,340 247 Other noninterest income 1,752 1,519 Noninterest Income (in-scope of Topic 606) 15,340 11,007 Noninterest Income (out-of-scope of Topic 606) 7,746 2,491 Total Noninterest Income $ 23,086 $ 13,498 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Narrative) (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 USD ($) segment loan | Dec. 31, 2021 USD ($) segment | Jan. 31, 2023 USD ($) | |
Significant Accounting Policies [Line Items] | |||
Depreciation and amortization calculation method | Depreciation and amortization are calculated using the straight-line method over the estimated useful lives of the assets. | ||
Number of operating segments | segment | 2 | 2 | |
Impairment charges | $ 0 | $ 0 | |
Cash and cash equivalents excess of FDIC amount | 1,800 | ||
Advertising expenses | 898 | 339 | |
Reclassification of (gains) recognized in net income | $ 0 | 0 | |
Number Of Libor Based Loans | loan | 16 | ||
Percentage Of Libor Based Loans | 3.10% | ||
Provision for credit losses | $ 1,925 | (358) | |
Transfer of Loans | $ 7,800 | $ 0 | |
Land improvements | |||
Significant Accounting Policies [Line Items] | |||
Property plant and equipment useful life | 15 years | ||
Minimum [Member] | Core Deposits Intangible [Member] | |||
Significant Accounting Policies [Line Items] | |||
Finite-Lived intangible asset, useful life | 7 years | ||
Minimum [Member] | Furniture, Fixtures and Equipment [Member] | |||
Significant Accounting Policies [Line Items] | |||
Property plant and equipment useful life | 3 years | ||
Minimum [Member] | Computer hardware and data handling equipment | |||
Significant Accounting Policies [Line Items] | |||
Property plant and equipment useful life | 3 years | ||
Minimum [Member] | Buildings and building improvements | |||
Significant Accounting Policies [Line Items] | |||
Property plant and equipment useful life | 10 years | ||
Minimum [Member] | Subsequent Event | Accounting Standards Update 2016-13 [Member] | |||
Significant Accounting Policies [Line Items] | |||
Transition Adjustments | $ 7,000 | ||
Maximum [Member] | Core Deposits Intangible [Member] | |||
Significant Accounting Policies [Line Items] | |||
Finite-Lived intangible asset, useful life | 10 years | ||
Maximum [Member] | Furniture, Fixtures and Equipment [Member] | |||
Significant Accounting Policies [Line Items] | |||
Property plant and equipment useful life | 10 years | ||
Maximum [Member] | Computer hardware and data handling equipment | |||
Significant Accounting Policies [Line Items] | |||
Property plant and equipment useful life | 5 years | ||
Maximum [Member] | Buildings and building improvements | |||
Significant Accounting Policies [Line Items] | |||
Property plant and equipment useful life | 40 years | ||
Maximum [Member] | Subsequent Event | Accounting Standards Update 2016-13 [Member] | |||
Significant Accounting Policies [Line Items] | |||
Transition Adjustments | $ 9,000 |
Business Combination (Narrative
Business Combination (Narrative) (Details) $ / shares in Units, $ in Thousands | Dec. 14, 2022 shares | Oct. 31, 2021 USD ($) Office $ / shares shares | Dec. 31, 2022 USD ($) loan | Dec. 31, 2021 USD ($) | Oct. 29, 2021 $ / shares |
Business Acquisition [Line Items] | |||||
Number of Shares to be Issued for each share | shares | 2.3287 | ||||
Goodwill | $ 63,266 | $ 63,421 | |||
Total assets | $ 3,477,276 | 3,460,136 | |||
Severn Bancorp, Inc. | |||||
Business Acquisition [Line Items] | |||||
Total assets | $ 1,100,000 | ||||
Number of full-service community banking offices | Office | 7 | ||||
Number of performing loans | loan | 1,306 | ||||
Number of PCI loans | loan | 162 | ||||
Certain Loans Acquired In Transfer Not Accounted For As Debt Securities Fair Valuation Process Discount Amount | $ 8,700 | ||||
Severn Bancorp, Inc. | |||||
Business Acquisition [Line Items] | |||||
Severn shareholders owned | 40.40% | ||||
Severn Bancorp, Inc. | |||||
Business Acquisition [Line Items] | |||||
Number of Shares to be Issued for each share | shares | 0.6207 | ||||
Cash Payment for Each Share | $ / shares | $ 1.59 | ||||
Purchase price per share | $ / shares | $ 18.48 | $ 18.48 | |||
Total transaction price | $ 169,765 | ||||
Goodwill | $ 45,900 | 45,749 | $ 45,904 | ||
Shore shareholders owned | 59.60% | ||||
Debt Instrument, Unamortized Discount (Premium), Net | $ 593,300 |
Business Combination (Schedule
Business Combination (Schedule of Consideration Paid and Provisional Fair Value of Acquired Identified Assets and Liabilities Assumed) (Details) - USD ($) $ / shares in Units, $ in Thousands | Oct. 31, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | Oct. 29, 2021 |
Identifiable liabilities: | ||||
Net carrying amount | $ 63,266 | $ 63,421 | ||
Severn Bancorp, Inc. | ||||
Purchase Price Consideration: | ||||
Fair value of common shares issued (8,053,088 shares) based on Shore Bancshares, Inc. share price of $18.48 | $ 148,821 | |||
Cash consideration | 20,631 | |||
Cash paid for cash-out Severn stock options | 310 | |||
Cash for fractional shares | 3 | |||
Total purchase price | 169,765 | |||
Identifiable assets: | ||||
Cash and cash equivalents | 326,725 | |||
Total securities | 146,292 | |||
Loans held for sale | 9,613 | |||
Loans, net | 584,776 | |||
Premises and equipment, net | 24,768 | |||
Other real estate owned | 329 | |||
Core deposit intangible asset | 6,550 | |||
Other assets | 20,319 | |||
Total identifiable assets | 1,119,372 | |||
Identifiable liabilities: | ||||
Deposits | 955,288 | |||
Total debt | 28,341 | |||
Other liabilities | 11,727 | |||
Total identifiable liabilities | 995,356 | |||
Fair value of net assets acquired including identifiable intangible assets | 124,016 | |||
Net carrying amount | $ 45,900 | $ 45,749 | $ 45,904 | |
Fair value of common shares issued | 8,053,088 | |||
Purchase price per share | $ 18.48 | $ 18.48 |
Business Combination (Schedul_2
Business Combination (Schedule of Changes in Fair Value of Assets Acquired and Liabilities Assumed) (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2022 USD ($) | |
Business Acquisition [Line Items] | |
Goodwill, Beginning Balance | $ 63,421 |
Goodwill, Ending Balance | 63,266 |
Severn Bancorp, Inc. | |
Business Acquisition [Line Items] | |
Goodwill, Beginning Balance | 45,904 |
Loans, net | (192) |
Other assets | 37 |
Goodwill, Ending Balance | $ 45,749 |
Business Combination (Schedul_3
Business Combination (Schedule of Contractually Required Payments Receivable) (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2022 USD ($) | |
Contractually required payments receivable | $ 46,833 |
Nonaccretable difference | (3,364) |
Cash flows expected to be collected | 43,469 |
Accretable yield | (5,667) |
Fair value | $ 37,802 |
Investment Securities (Narrativ
Investment Securities (Narrative) (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 USD ($) security | Dec. 31, 2021 USD ($) security | |
Proceeds from sale and maturity of marketable securities | $ 0 | $ 0 |
Debt Securities, Available-for-sale, Unrealized Loss Position, Number of Positions | security | 116 | 35 |
Held-to-maturity, Securities in Unrealized Loss Positions, Qualitative Disclosure, Number of Positions | security | 192 | 114 |
Net Income (Loss), Including Portion Attributable to Noncontrolling Interest | $ 31,177 | $ 15,368 |
Equity Securities Fv Ni | 1,233 | 1,372 |
Accounting Standards Update 2016-01 [Member] | ||
Equity Securities Fv Ni | 1,200 | 1,400 |
Revision of Prior Period, Change in Accounting Principle, Adjustment [Member] | Accounting Standards Update 2016-01 [Member] | ||
Net Income (Loss), Including Portion Attributable to Noncontrolling Interest | $ (157) | $ (40) |
Investment Securities (Amortize
Investment Securities (Amortized Cost and Estimated Fair Values of Investment Securities) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Schedule of Available-for-sale Securities [Line Items] | ||
Available-for-sale securities, Amortized Cost | $ 95,999 | $ 116,906 |
Available-for-sale securities, Gross Unrealized Gains | 7 | 1,339 |
Available-for-sale securities, Gross Unrealized Losses | 12,419 | 1,263 |
Available-for-sale, at fair value | 83,587 | 116,982 |
Held-to-maturity Securities, Amortized Cost | 559,455 | 404,594 |
Held-to-maturity securities, Gross Unrealized Gains | 35 | 418 |
Held-to-maturity securities, Gross Unrealized Losses | 64,863 | 3,488 |
Held-to-maturity securities, Estimated Fair Value | 494,627 | 401,524 |
Equity securities, at fair value | 1,233 | 1,372 |
Fair value adjustment recorded through earnings | 31,177 | 15,368 |
U.S. Government Agencies [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Available-for-sale securities, Amortized Cost | 21,798 | 22,932 |
Available-for-sale securities, Gross Unrealized Gains | 5 | 7 |
Available-for-sale securities, Gross Unrealized Losses | 3,625 | 634 |
Available-for-sale, at fair value | 18,178 | 22,305 |
Held-to-maturity Securities, Amortized Cost | 148,097 | 87,072 |
Held-to-maturity securities, Gross Unrealized Gains | 20 | |
Held-to-maturity securities, Gross Unrealized Losses | 13,601 | 1,231 |
Held-to-maturity securities, Estimated Fair Value | 134,496 | 85,861 |
States and Political Subdivisions [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Held-to-maturity Securities, Amortized Cost | 1,474 | 400 |
Held-to-maturity securities, Gross Unrealized Gains | 35 | 2 |
Held-to-maturity securities, Gross Unrealized Losses | 28 | |
Held-to-maturity securities, Estimated Fair Value | 1,481 | 402 |
Mortgage-backed [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Available-for-sale securities, Amortized Cost | 72,183 | 91,948 |
Available-for-sale securities, Gross Unrealized Gains | 2 | 1,318 |
Available-for-sale securities, Gross Unrealized Losses | 8,666 | 629 |
Available-for-sale, at fair value | 63,519 | 92,637 |
Held-to-maturity Securities, Amortized Cost | 398,884 | 302,604 |
Held-to-maturity securities, Gross Unrealized Gains | 301 | |
Held-to-maturity securities, Gross Unrealized Losses | 50,464 | 2,248 |
Held-to-maturity securities, Estimated Fair Value | 348,420 | 300,657 |
Other debt securities [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Available-for-sale securities, Amortized Cost | 2,018 | 2,026 |
Available-for-sale securities, Gross Unrealized Gains | 14 | |
Available-for-sale securities, Gross Unrealized Losses | 128 | |
Available-for-sale, at fair value | 1,890 | 2,040 |
Held-to-maturity Securities, Amortized Cost | 11,000 | 14,518 |
Held-to-maturity securities, Gross Unrealized Gains | 95 | |
Held-to-maturity securities, Gross Unrealized Losses | 770 | 9 |
Held-to-maturity securities, Estimated Fair Value | $ 10,230 | $ 14,604 |
Investment Securities (Gross Un
Investment Securities (Gross Unrealized Losses and Fair Value by Length of Continuous Unrealized Loss Position) (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Schedule of Available-for-sale Securities [Line Items] | ||
Available-for-sale securities, continuous unrealized loss position, less than 12 months, fair value | $ 32,180 | $ 41,412 |
Available-for-sale securities, continuous unrealized loss position, less than 12 Months, unrealized losses | 2,541 | 594 |
Available-for-sale securities, continuous unrealized loss position, more than 12 Months, fair value | 50,752 | 20,930 |
Available-for-sale securities, continuous unrealized loss position, more than 12 Months, unrealized losses | 9,878 | 669 |
Available-for-sale securities, continuous unrealized loss position, fair value | 82,932 | 62,342 |
Available-for-sale securities, continuous unrealized loss position, unrealized losses | 12,419 | 1,263 |
Held-to-maturity securities, continuous unrealized loss position, less than 12 Months, fair value | 224,974 | 291,677 |
Held-to-maturity securities, continuous unrealized loss position, less than 12 Months, unrealized losses | 12,625 | 2,850 |
Held-to-maturity securities, continuous unrealized loss position, more than 12 Months, fair value | 268,951 | 26,283 |
Held-to-maturity securities, continuous unrealized loss position, more than 12 Months, unrealized losses | 52,238 | 638 |
Held-to-maturity securities, continuous unrealized loss position, fair value | 493,925 | 317,960 |
Held-to-maturity securities, continuous unrealized loss position, unrealized losses | 64,863 | 3,488 |
Mortgage-backed [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Available-for-sale securities, continuous unrealized loss position, less than 12 months, fair value | 29,125 | 39,851 |
Available-for-sale securities, continuous unrealized loss position, less than 12 Months, unrealized losses | 2,409 | 593 |
Available-for-sale securities, continuous unrealized loss position, more than 12 Months, fair value | 34,167 | 3,562 |
Available-for-sale securities, continuous unrealized loss position, more than 12 Months, unrealized losses | 6,290 | 36 |
Available-for-sale securities, continuous unrealized loss position, fair value | 63,292 | 43,413 |
Available-for-sale securities, continuous unrealized loss position, unrealized losses | 8,699 | 629 |
Held-to-maturity securities, continuous unrealized loss position, less than 12 Months, fair value | 148,771 | 226,918 |
Held-to-maturity securities, continuous unrealized loss position, less than 12 Months, unrealized losses | 9,402 | 1,836 |
Held-to-maturity securities, continuous unrealized loss position, more than 12 Months, fair value | 199,649 | 14,564 |
Held-to-maturity securities, continuous unrealized loss position, more than 12 Months, unrealized losses | 41,062 | 412 |
Held-to-maturity securities, continuous unrealized loss position, fair value | 348,420 | 241,482 |
Held-to-maturity securities, continuous unrealized loss position, unrealized losses | 50,464 | 2,248 |
U.S. Government Agencies [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Available-for-sale securities, continuous unrealized loss position, less than 12 months, fair value | 1,165 | 1,561 |
Available-for-sale securities, continuous unrealized loss position, less than 12 Months, unrealized losses | 4 | 1 |
Available-for-sale securities, continuous unrealized loss position, more than 12 Months, fair value | 16,585 | 17,368 |
Available-for-sale securities, continuous unrealized loss position, more than 12 Months, unrealized losses | 3,588 | 633 |
Available-for-sale securities, continuous unrealized loss position, fair value | 17,750 | 18,929 |
Available-for-sale securities, continuous unrealized loss position, unrealized losses | 3,592 | 634 |
Held-to-maturity securities, continuous unrealized loss position, less than 12 Months, fair value | 67,332 | 64,268 |
Held-to-maturity securities, continuous unrealized loss position, less than 12 Months, unrealized losses | 2,786 | 1,005 |
Held-to-maturity securities, continuous unrealized loss position, more than 12 Months, fair value | 67,163 | 11,719 |
Held-to-maturity securities, continuous unrealized loss position, more than 12 Months, unrealized losses | 10,815 | 226 |
Held-to-maturity securities, continuous unrealized loss position, fair value | 134,495 | 75,987 |
Held-to-maturity securities, continuous unrealized loss position, unrealized losses | 13,601 | 1,231 |
Other debt securities [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Available-for-sale securities, continuous unrealized loss position, less than 12 months, fair value | 1,890 | |
Available-for-sale securities, continuous unrealized loss position, less than 12 Months, unrealized losses | 128 | |
Available-for-sale securities, continuous unrealized loss position, fair value | 1,890 | |
Available-for-sale securities, continuous unrealized loss position, unrealized losses | 128 | |
Held-to-maturity securities, continuous unrealized loss position, less than 12 Months, fair value | 8,091 | 491 |
Held-to-maturity securities, continuous unrealized loss position, less than 12 Months, unrealized losses | 409 | 9 |
Held-to-maturity securities, continuous unrealized loss position, more than 12 Months, fair value | 2,139 | |
Held-to-maturity securities, continuous unrealized loss position, more than 12 Months, unrealized losses | 361 | |
Held-to-maturity securities, continuous unrealized loss position, fair value | 10,230 | 491 |
Held-to-maturity securities, continuous unrealized loss position, unrealized losses | 770 | $ 9 |
States and Political Subdivisions [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Held-to-maturity securities, continuous unrealized loss position, less than 12 Months, fair value | 780 | |
Held-to-maturity securities, continuous unrealized loss position, less than 12 Months, unrealized losses | 28 | |
Held-to-maturity securities, continuous unrealized loss position, fair value | 780 | |
Held-to-maturity securities, continuous unrealized loss position, unrealized losses | $ 28 |
Investment Securities (Amorti_2
Investment Securities (Amortized Cost and Estimated Fair Value by Maturity Date) (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Investment Securities [Abstract] | ||
Available for sale, Amortized Cost, Due in one year or less | $ 75 | |
Available for sale, Amortized Cost, Due after one year through five years | 6,658 | |
Available for sale, Amortized Cost, Due after five years through ten years | 42,689 | |
Available for sale, Amortized Cost, Due after ten years | 46,577 | |
Available-for-sale securities, Amortized Cost | 95,999 | $ 116,906 |
Available for sale, Estimated Fair Value, Due in one year or less | 74 | |
Available for sale, Estimated Fair Value, Due after one year through five years | 6,351 | |
Available for sale, Estimated Fair Value, Due after five years through ten years | 37,856 | |
Available for sale, Estimated Fair Value, Due after ten years | 39,306 | |
Available-for-sale Securities, Debt Securities, Total | 83,587 | 116,982 |
Held to maturity securities, Amortized Cost, Due in one year or less | 2,117 | |
Held to maturity securities, Amortized Cost, Due after one year through five years | 108,632 | |
Held to maturity securities, Amortized Cost, Due after five years through ten years | 73,054 | |
Held to maturity securities, Amortized Cost, Due after ten years | 375,652 | |
Held-to-maturity Securities, Amortized Cost | 559,455 | 404,594 |
Held to maturity securities, Estimated Fair Value, Due in one year or less | 2,076 | |
Held to maturity securities, Estimated Fair Value, Due after one year through five years | 101,165 | |
Held to maturity securities, Estimated Fair Value, Due after five years through ten years | 66,502 | |
Held to maturity securities, Estimated Fair Value, Due after ten years | 324,884 | |
Held-to-maturity Securities, Fair Value, Total | $ 494,627 | $ 401,524 |
Investment Securities (Amorti_3
Investment Securities (Amortized Cost and Estimated Fair Values of Securities) (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Schedule of Available-for-sale Securities [Line Items] | ||
Available for sale, Amortized Cost, Total | $ 95,999 | $ 116,906 |
Available-for-sale, Pledged available-for-sale securities, Estimated Fair Value | 11,169 | 4,159 |
Held-to-Maturity, Amortized cost | 559,455 | 404,594 |
Held-to-maturity securities, Estimated Fair Value, Total | 494,627 | 401,524 |
Collateral Pledged [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Available for sale, Amortized Cost, Total | 83,288 | 78,522 |
Available-for-sale, Pledged available-for-sale securities, Estimated Fair Value | 72,108 | 78,352 |
Held-to-Maturity, Amortized cost | 19,158 | 913 |
Held-to-maturity securities, Estimated Fair Value, Total | $ 16,305 | $ 915 |
Loans and Allowance for Credi_3
Loans and Allowance for Credit Losses (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Financing Receivable, Allowance for Credit Losses [Line Items] | ||
Financing receivable, recorded investment, nonaccrual status | $ 1,908 | $ 2,004 |
Mortgage loans in process of foreclosure, amount | 18 | 203 |
Loans and leases receivable, net amount, total | 2,539,464 | 2,105,231 |
Financing receivable origination fee, net | $ 1,400 | $ 1,200 |
Allowance from loan losses, as a percentage of total loans | 0.65% | 0.66% |
Allowance from loan losses excluding PPP loans, as a percentage of total loans | 0.65% | 0.67% |
Small Business Administration (SBA), CARES Act, Paycheck Protection Program [Member] | ||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||
Financing Receivable, Amount of Loans Authorized | $ 187 | $ 27,600 |
Federal National Mortgage Association | ||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||
Loans and leases receivable, net amount, total | 343,800 | |
Federal Home Loan Mortgage Corporation | ||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||
Loans and leases receivable, net amount, total | 74,100 | |
Directors, Associates and Policy Making Officers [Member] | ||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||
Loans and leases receivable, related parties | 24,100 | 18,700 |
Loans and leases receivable, related parties, additions | 7,600 | 16,500 |
Loans and leases receivable, related parties, proceeds | 2,200 | 1,500 |
Residential Portfolio Segment [Member] | ||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||
Financing receivable, recorded investment, nonaccrual status | 1,259 | 803 |
Mortgage loans in process of foreclosure, amount | 263 | 311 |
Consumer Portfolio Segment [Member] | ||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||
Financing receivable, recorded investment, nonaccrual status | 28 | |
Northwest Bank Branches [Member] | ||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||
Business Combination Recognized Identifiable Assets Acquired And Liabilities Assumed Financing Receivable Net of Allowance | 22,900 | 39,900 |
Business Combination Recognized Identifiable Assets Acquired And Liabilities Assumed Financing Receivable, Related Discount | 298 | 516 |
Severn Bancorp, Inc. | ||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||
Loans and leases receivable, related parties, additions | 15,400 | |
Business Combination Recognized Identifiable Assets Acquired And Liabilities Assumed Financing Receivable Net of Allowance | 372,200 | 553,000 |
Business Combination Recognized Identifiable Assets Acquired And Liabilities Assumed Financing Receivable, Related Discount | 6,700 | 8,400 |
Financing Receivable, Amount of Loans Authorized | 9,200 | |
Special Mention [Member] | ||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||
Financing receivable, recorded investment, nonaccrual status | 0 | 0 |
Substandard [Member] | ||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||
Financing receivable, recorded investment, nonaccrual status | 1,900 | 2,000 |
Doubtful [Member] | ||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||
Financing receivable, recorded investment, nonaccrual status | $ 0 | $ 0 |
Loans and Allowance for Credi_4
Loans and Allowance for Credit Losses (Loans by Class of Loan Portfolio) (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Loans and Leases Receivable Disclosure [Line Items] | ||
Loans held for investment | $ 2,556,107 | $ 2,119,175 |
Allowance for credit losses | (16,643) | (13,944) |
Loans, net | 2,539,464 | 2,105,231 |
Outstanding principal balance | 46,833 | |
Acquired loans - PCI | 26,642 | 33,650 |
PCI loans acquired | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Loans held for investment | 26,642 | 33,650 |
Severn Bancorp, Inc. | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Outstanding principal balance | 378,882 | 561,417 |
Acquired loans - PCI | 372,183 | 552,993 |
Severn Bancorp, Inc. | PCI loans acquired | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Outstanding principal balance | 29,620 | 36,943 |
Acquired loans - PCI | 26,642 | 33,650 |
Severn Bancorp, Inc. | Performing loans acquired | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Outstanding principal balance | 349,262 | 524,474 |
Acquired loans - PCI | 345,541 | 519,343 |
Severn Bancorp, Inc. | Construction Loans [Member] | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Acquired loans - PCI | 19,411 | 94,202 |
Severn Bancorp, Inc. | Construction Loans [Member] | PCI loans acquired | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Acquired loans - PCI | 650 | 2,379 |
Severn Bancorp, Inc. | Construction Loans [Member] | Performing loans acquired | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Acquired loans - PCI | 18,761 | 91,823 |
Commercial and Residential Real Estate Portfolio Segment [Member] | Construction Loans [Member] | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Loans held for investment | 246,319 | 239,353 |
Allowance for credit losses | (2,973) | (2,454) |
Acquired loans - PCI | 650 | 2,379 |
Commercial and Residential Real Estate Portfolio Segment [Member] | Construction Loans [Member] | PCI loans acquired | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Loans held for investment | 650 | 2,379 |
Residential Portfolio Segment [Member] | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Loans held for investment | 810,497 | 654,769 |
Allowance for credit losses | (2,622) | (2,858) |
Acquired loans - PCI | 13,956 | 17,326 |
Residential Portfolio Segment [Member] | PCI loans acquired | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Loans held for investment | 13,956 | 17,326 |
Residential Portfolio Segment [Member] | Severn Bancorp, Inc. | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Acquired loans - PCI | 130,074 | 184,906 |
Residential Portfolio Segment [Member] | Severn Bancorp, Inc. | PCI loans acquired | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Acquired loans - PCI | 13,956 | 17,326 |
Residential Portfolio Segment [Member] | Severn Bancorp, Inc. | Performing loans acquired | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Acquired loans - PCI | 116,118 | 167,580 |
Commercial Real Estate Portfolio Segment [Member] | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Loans held for investment | 1,065,409 | 896,229 |
Allowance for credit losses | (4,899) | (4,598) |
Acquired loans - PCI | 11,866 | 13,594 |
Commercial Real Estate Portfolio Segment [Member] | PCI loans acquired | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Loans held for investment | 11,866 | 13,594 |
Commercial Real Estate Portfolio Segment [Member] | Severn Bancorp, Inc. | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Acquired loans - PCI | 186,144 | 216,413 |
Commercial Real Estate Portfolio Segment [Member] | Severn Bancorp, Inc. | PCI loans acquired | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Acquired loans - PCI | 11,866 | 13,594 |
Commercial Real Estate Portfolio Segment [Member] | Severn Bancorp, Inc. | Performing loans acquired | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Acquired loans - PCI | 174,278 | 202,819 |
Commercial Portfolio Segment [Member] | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Loans held for investment | 147,856 | 203,377 |
Allowance for credit losses | (1,652) | (2,070) |
Acquired loans - PCI | 156 | 321 |
Commercial Portfolio Segment [Member] | PCI loans acquired | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Loans held for investment | 156 | 321 |
Commercial Portfolio Segment [Member] | Severn Bancorp, Inc. | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Acquired loans - PCI | 35,843 | 56,521 |
Commercial Portfolio Segment [Member] | Severn Bancorp, Inc. | PCI loans acquired | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Acquired loans - PCI | 156 | 321 |
Commercial Portfolio Segment [Member] | Severn Bancorp, Inc. | Performing loans acquired | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Acquired loans - PCI | 35,687 | 56,200 |
Consumer Portfolio Segment [Member] | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Loans held for investment | 286,026 | 125,447 |
Allowance for credit losses | (4,497) | (1,964) |
Acquired loans - PCI | 14 | 30 |
Consumer Portfolio Segment [Member] | PCI loans acquired | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Loans held for investment | 14 | 30 |
Consumer Portfolio Segment [Member] | Severn Bancorp, Inc. | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Acquired loans - PCI | 711 | 951 |
Consumer Portfolio Segment [Member] | Severn Bancorp, Inc. | PCI loans acquired | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Acquired loans - PCI | 14 | 30 |
Consumer Portfolio Segment [Member] | Severn Bancorp, Inc. | Performing loans acquired | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Acquired loans - PCI | $ 697 | $ 921 |
Loans and Allowance for Credi_5
Loans and Allowance for Credit Losses (PCI Loans Acquired) (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2022 USD ($) | |
Certain Loans Acquired in Transfer Not Accounted for as Debt Securities, Accretable Yield Movement Schedule [Roll Forward] | |
Additions | $ 5,667 |
Severn Bancorp, Inc. | PCI loans acquired | |
Certain Loans Acquired in Transfer Not Accounted for as Debt Securities, Accretable Yield Movement Schedule [Roll Forward] | |
Accretable yield, beginning of period | 5,367 |
Accretion | (1,603) |
Reclassification of nonaccretable difference due to improvement in expected cash flows | 469 |
Other changes, net | 506 |
Accretable yield, end of period | $ 4,739 |
Loans and Allowance for Credi_6
Loans and Allowance for Credit Losses (Allowance for Credit Losses on Loans Receivable with Impairment) (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Financing Receivable, Allowance for Credit Losses [Line Items] | ||
Loans individually evaluated for impairment | $ 8,154 | $ 8,097 |
Loans collectively evaluated for impairment | 2,512,874 | 2,077,428 |
Acquired loans - PCI | 26,642 | 33,650 |
Total loans | 2,547,670 | 2,119,175 |
Allowance for credit losses allocated to: | ||
Loans individually evaluated for impairment | 127 | 173 |
Loans collectively evaluated for impairment | 16,516 | 13,771 |
Loans and Leases Receivable, Allowance, Total | 16,643 | 13,944 |
Loans, net | 8,437 | |
Commercial and Residential Real Estate Portfolio Segment [Member] | Construction Loans [Member] | ||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||
Loans individually evaluated for impairment | 331 | 321 |
Loans collectively evaluated for impairment | 236,901 | 236,653 |
Acquired loans - PCI | 650 | 2,379 |
Total loans | 237,882 | 239,353 |
Allowance for credit losses allocated to: | ||
Loans collectively evaluated for impairment | 2,973 | 2,454 |
Loans and Leases Receivable, Allowance, Total | 2,973 | 2,454 |
Residential Portfolio Segment [Member] | ||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||
Loans individually evaluated for impairment | 5,081 | 3,717 |
Loans collectively evaluated for impairment | 791,460 | 633,726 |
Acquired loans - PCI | 13,956 | 17,326 |
Total loans | 810,497 | 654,769 |
Allowance for credit losses allocated to: | ||
Loans individually evaluated for impairment | 127 | 172 |
Loans collectively evaluated for impairment | 2,495 | 2,686 |
Loans and Leases Receivable, Allowance, Total | 2,622 | 2,858 |
Commercial Real Estate Portfolio Segment [Member] | ||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||
Loans individually evaluated for impairment | 2,540 | 3,833 |
Loans collectively evaluated for impairment | 1,051,003 | 878,802 |
Acquired loans - PCI | 11,866 | 13,594 |
Total loans | 1,065,409 | 896,229 |
Allowance for credit losses allocated to: | ||
Loans individually evaluated for impairment | 1 | |
Loans collectively evaluated for impairment | 4,899 | 4,597 |
Loans and Leases Receivable, Allowance, Total | 4,899 | 4,598 |
Commercial Portfolio Segment [Member] | ||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||
Loans individually evaluated for impairment | 174 | 226 |
Loans collectively evaluated for impairment | 147,526 | 202,830 |
Acquired loans - PCI | 156 | 321 |
Total loans | 147,856 | 203,377 |
Allowance for credit losses allocated to: | ||
Loans collectively evaluated for impairment | 1,652 | 2,070 |
Loans and Leases Receivable, Allowance, Total | 1,652 | 2,070 |
Consumer Portfolio Segment [Member] | ||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||
Loans individually evaluated for impairment | 28 | |
Loans collectively evaluated for impairment | 285,984 | 125,417 |
Acquired loans - PCI | 14 | 30 |
Total loans | 286,026 | 125,447 |
Allowance for credit losses allocated to: | ||
Loans collectively evaluated for impairment | 4,497 | 1,964 |
Loans and Leases Receivable, Allowance, Total | $ 4,497 | $ 1,964 |
Loans and Allowance for Credi_7
Loans and Allowance for Credit Losses (Impaired Financing Receivables by Loan Class) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Impaired Nonaccrual Loans [Member] | ||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||
Unpaid principal balance | $ 2,207 | $ 2,553 |
Recorded investment with no allowance | 1,908 | 1,922 |
Year-to-date average recorded investment | 2,844 | 3,765 |
Impaired Accruing Restructured Loans [Member] | ||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||
Unpaid principal balance | 4,539 | 5,796 |
Recorded investment with no allowance | 2,866 | 2,851 |
Recorded investment with an allowance | 1,539 | 2,816 |
Related allowance | 127 | 173 |
Year-to-date average recorded investment | 5,095 | 6,132 |
Interest recorded investment | 165 | 236 |
Other Impaired Accruing Loans [Member] | ||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||
Unpaid principal balance | 1,841 | 508 |
Recorded investment with no allowance | 1,841 | 508 |
Year-to-date average recorded investment | 1,308 | 948 |
Interest recorded investment | 40 | 38 |
Impaired Loans [Member] | ||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||
Unpaid principal balance | 8,587 | 8,857 |
Recorded investment with no allowance | 6,615 | 5,281 |
Recorded investment with an allowance | 1,539 | 2,816 |
Related allowance | 127 | 173 |
Year-to-date average recorded investment | 9,247 | 10,845 |
Interest recorded investment | 205 | 274 |
Residential Portfolio Segment [Member] | Impaired Nonaccrual Loans [Member] | ||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||
Unpaid principal balance | 1,363 | 882 |
Recorded investment with no allowance | 1,259 | 803 |
Year-to-date average recorded investment | 1,661 | 1,095 |
Residential Portfolio Segment [Member] | Impaired Accruing Restructured Loans [Member] | ||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||
Unpaid principal balance | 2,849 | 2,965 |
Recorded investment with no allowance | 1,176 | 475 |
Recorded investment with an allowance | 1,539 | 2,361 |
Related allowance | 127 | 172 |
Year-to-date average recorded investment | 2,979 | 3,150 |
Interest recorded investment | 108 | 146 |
Residential Portfolio Segment [Member] | Other Impaired Accruing Loans [Member] | ||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||
Unpaid principal balance | 1,107 | 78 |
Recorded investment with no allowance | 1,107 | 78 |
Year-to-date average recorded investment | 474 | 465 |
Interest recorded investment | 3 | 21 |
Residential Portfolio Segment [Member] | Impaired Loans [Member] | ||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||
Unpaid principal balance | 5,319 | 3,925 |
Recorded investment with no allowance | 3,542 | 1,356 |
Recorded investment with an allowance | 1,539 | 2,361 |
Related allowance | 127 | 172 |
Year-to-date average recorded investment | 5,114 | 4,710 |
Interest recorded investment | 111 | 167 |
Commercial Real Estate Portfolio Segment [Member] | Impaired Nonaccrual Loans [Member] | ||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||
Unpaid principal balance | 159 | 994 |
Recorded investment with no allowance | 150 | 606 |
Year-to-date average recorded investment | 604 | 2,122 |
Commercial Real Estate Portfolio Segment [Member] | Impaired Accruing Restructured Loans [Member] | ||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||
Unpaid principal balance | 1,680 | 2,807 |
Recorded investment with no allowance | 1,680 | 2,352 |
Recorded investment with an allowance | 455 | |
Related allowance | 1 | |
Year-to-date average recorded investment | 2,095 | 2,952 |
Interest recorded investment | 56 | 87 |
Commercial Real Estate Portfolio Segment [Member] | Other Impaired Accruing Loans [Member] | ||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||
Unpaid principal balance | 710 | 420 |
Recorded investment with no allowance | 710 | 420 |
Year-to-date average recorded investment | 553 | 470 |
Interest recorded investment | 30 | 17 |
Commercial Real Estate Portfolio Segment [Member] | Impaired Loans [Member] | ||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||
Unpaid principal balance | 2,549 | 4,221 |
Recorded investment with no allowance | 2,540 | 3,378 |
Recorded investment with an allowance | 455 | |
Related allowance | 1 | |
Year-to-date average recorded investment | 3,252 | 5,544 |
Interest recorded investment | 86 | 104 |
Commercial Portfolio Segment [Member] | Impaired Nonaccrual Loans [Member] | ||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||
Unpaid principal balance | 359 | 380 |
Recorded investment with no allowance | 174 | 216 |
Year-to-date average recorded investment | 227 | 242 |
Commercial Portfolio Segment [Member] | Other Impaired Accruing Loans [Member] | ||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||
Unpaid principal balance | 10 | |
Recorded investment with no allowance | 10 | |
Year-to-date average recorded investment | 51 | 13 |
Interest recorded investment | 1 | |
Commercial Portfolio Segment [Member] | Impaired Loans [Member] | ||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||
Unpaid principal balance | 359 | 390 |
Recorded investment with no allowance | 174 | 226 |
Year-to-date average recorded investment | 278 | 255 |
Interest recorded investment | 1 | |
Consumer Portfolio Segment [Member] | Impaired Nonaccrual Loans [Member] | ||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||
Unpaid principal balance | 29 | |
Recorded investment with no allowance | 28 | |
Year-to-date average recorded investment | 43 | 9 |
Consumer Portfolio Segment [Member] | Impaired Accruing Restructured Loans [Member] | ||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||
Year-to-date average recorded investment | 5 | |
Consumer Portfolio Segment [Member] | Other Impaired Accruing Loans [Member] | ||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||
Year-to-date average recorded investment | 15 | |
Consumer Portfolio Segment [Member] | Impaired Loans [Member] | ||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||
Unpaid principal balance | 29 | |
Recorded investment with no allowance | 28 | |
Year-to-date average recorded investment | 63 | 9 |
Construction Loans [Member] | Commercial and Residential Real Estate Portfolio Segment [Member] | Impaired Nonaccrual Loans [Member] | ||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||
Unpaid principal balance | 297 | 297 |
Recorded investment with no allowance | 297 | 297 |
Year-to-date average recorded investment | 309 | 297 |
Construction Loans [Member] | Commercial and Residential Real Estate Portfolio Segment [Member] | Impaired Accruing Restructured Loans [Member] | ||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||
Unpaid principal balance | 10 | 24 |
Recorded investment with no allowance | 10 | 24 |
Year-to-date average recorded investment | 16 | 30 |
Interest recorded investment | 1 | 3 |
Construction Loans [Member] | Commercial and Residential Real Estate Portfolio Segment [Member] | Other Impaired Accruing Loans [Member] | ||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||
Unpaid principal balance | 24 | |
Recorded investment with no allowance | 24 | |
Year-to-date average recorded investment | 215 | |
Interest recorded investment | 6 | |
Construction Loans [Member] | Commercial and Residential Real Estate Portfolio Segment [Member] | Impaired Loans [Member] | ||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||
Unpaid principal balance | 331 | 321 |
Recorded investment with no allowance | 331 | 321 |
Year-to-date average recorded investment | 540 | 327 |
Interest recorded investment | $ 7 | $ 3 |
Loans and Allowance for Credi_8
Loans and Allowance for Credit Losses (Rollforward of TDRs) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Financing Receivable, Allowance for Credit Losses [Line Items] | ||
TDR beginning balance | $ 5,883 | $ 7,255 |
Disbursements (Payments) | (346) | (472) |
Payoffs | (948) | (900) |
TDR ending balance | 4,589 | 5,883 |
TDR, Related Allowance | 127 | 173 |
Impaired Nonaccrual Loans [Member] | ||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||
TDR beginning balance | 216 | 258 |
Disbursements (Payments) | (52) | (42) |
Reclassifications/Transfer In/(Out) | 20 | |
TDR ending balance | 184 | 216 |
Impaired Nonaccrual Loans [Member] | Residential Portfolio Segment [Member] | ||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||
Disbursements (Payments) | (6) | |
Reclassifications/Transfer In/(Out) | 20 | |
TDR ending balance | 14 | |
Impaired Nonaccrual Loans [Member] | Commercial Portfolio Segment [Member] | ||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||
TDR beginning balance | 216 | 258 |
Disbursements (Payments) | (46) | (42) |
TDR ending balance | 170 | 216 |
Impaired Accruing Restructured Loans [Member] | ||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||
TDR beginning balance | 5,667 | 6,997 |
Disbursements (Payments) | (294) | (430) |
Reclassifications/Transfer In/(Out) | (20) | |
Payoffs | (948) | (900) |
TDR ending balance | 4,405 | 5,667 |
TDR, Related Allowance | 127 | 173 |
Impaired Accruing Restructured Loans [Member] | Residential Portfolio Segment [Member] | ||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||
TDR beginning balance | 2,836 | 3,845 |
Disbursements (Payments) | (100) | (109) |
Reclassifications/Transfer In/(Out) | (20) | |
Payoffs | (1) | (900) |
TDR ending balance | 2,715 | 2,836 |
TDR, Related Allowance | 127 | 172 |
Impaired Accruing Restructured Loans [Member] | Commercial Real Estate Portfolio Segment [Member] | ||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||
TDR beginning balance | 2,807 | 3,118 |
Disbursements (Payments) | (180) | (311) |
Payoffs | (947) | |
TDR ending balance | 1,680 | 2,807 |
TDR, Related Allowance | 1 | |
Impaired Accruing Restructured Loans [Member] | Construction Loans [Member] | Commercial and Residential Real Estate Portfolio Segment [Member] | ||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||
TDR beginning balance | 24 | 34 |
Disbursements (Payments) | (14) | (10) |
TDR ending balance | $ 10 | $ 24 |
Loans and Allowance for Credi_9
Loans and Allowance for Credit Losses (Troubled Debt Restructurings With Subsequent Default) (Details) - contract | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Loans and Allowance for Credit Losses [Abstract] | ||
Number of contracts modified as TDRs which subsequently defaulted within 12 months | 0 | 0 |
Loans and Allowance for Cred_10
Loans and Allowance for Credit Losses (Financing Receivable Credit Quality Indicators) (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Financing Receivable, Recorded Investment [Line Items] | ||
Loan Risk Rating | $ 2,556,107 | $ 2,119,175 |
PCI loans acquired | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loan Risk Rating | 26,642 | 33,650 |
Pass/Performing [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loan Risk Rating | 2,338,936 | 1,842,918 |
Pass Watch [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loan Risk Rating | 184,544 | 230,900 |
Special Mention [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loan Risk Rating | 3,539 | 7,951 |
Substandard [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loan Risk Rating | 2,446 | 3,756 |
Doubtful [Member] | PCI loans acquired | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loan Risk Rating | 33,650 | |
Commercial and Residential Real Estate Portfolio Segment [Member] | Construction Loans [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loan Risk Rating | 246,319 | 239,353 |
Commercial and Residential Real Estate Portfolio Segment [Member] | Construction Loans [Member] | PCI loans acquired | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loan Risk Rating | 650 | 2,379 |
Commercial and Residential Real Estate Portfolio Segment [Member] | Construction Loans [Member] | Pass/Performing [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loan Risk Rating | 231,160 | 210,287 |
Commercial and Residential Real Estate Portfolio Segment [Member] | Construction Loans [Member] | Pass Watch [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loan Risk Rating | 14,212 | 24,513 |
Commercial and Residential Real Estate Portfolio Segment [Member] | Construction Loans [Member] | Special Mention [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loan Risk Rating | 1,877 | |
Commercial and Residential Real Estate Portfolio Segment [Member] | Construction Loans [Member] | Substandard [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loan Risk Rating | 297 | 297 |
Commercial and Residential Real Estate Portfolio Segment [Member] | Construction Loans [Member] | Doubtful [Member] | PCI loans acquired | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loan Risk Rating | 2,379 | |
Residential Portfolio Segment [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loan Risk Rating | 810,497 | 654,769 |
Residential Portfolio Segment [Member] | PCI loans acquired | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loan Risk Rating | 13,956 | 17,326 |
Residential Portfolio Segment [Member] | Pass/Performing [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loan Risk Rating | 761,405 | 596,694 |
Residential Portfolio Segment [Member] | Pass Watch [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loan Risk Rating | 32,467 | 38,309 |
Residential Portfolio Segment [Member] | Special Mention [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loan Risk Rating | 1,239 | 1,539 |
Residential Portfolio Segment [Member] | Substandard [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loan Risk Rating | 1,430 | 901 |
Residential Portfolio Segment [Member] | Doubtful [Member] | PCI loans acquired | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loan Risk Rating | 17,326 | |
Commercial Real Estate Portfolio Segment [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loan Risk Rating | 1,065,409 | 896,229 |
Commercial Real Estate Portfolio Segment [Member] | PCI loans acquired | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loan Risk Rating | 11,866 | 13,594 |
Commercial Real Estate Portfolio Segment [Member] | Pass/Performing [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loan Risk Rating | 929,501 | 724,561 |
Commercial Real Estate Portfolio Segment [Member] | Pass Watch [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loan Risk Rating | 121,711 | 151,209 |
Commercial Real Estate Portfolio Segment [Member] | Special Mention [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loan Risk Rating | 1,814 | 4,535 |
Commercial Real Estate Portfolio Segment [Member] | Substandard [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loan Risk Rating | 517 | 2,330 |
Commercial Real Estate Portfolio Segment [Member] | Doubtful [Member] | PCI loans acquired | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loan Risk Rating | 13,594 | |
Commercial Portfolio Segment [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loan Risk Rating | 147,856 | 203,377 |
Commercial Portfolio Segment [Member] | PCI loans acquired | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loan Risk Rating | 156 | 321 |
Commercial Portfolio Segment [Member] | Pass/Performing [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loan Risk Rating | 131,084 | 186,176 |
Commercial Portfolio Segment [Member] | Pass Watch [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loan Risk Rating | 15,958 | 16,654 |
Commercial Portfolio Segment [Member] | Special Mention [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loan Risk Rating | 484 | |
Commercial Portfolio Segment [Member] | Substandard [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loan Risk Rating | 174 | 226 |
Commercial Portfolio Segment [Member] | Doubtful [Member] | PCI loans acquired | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loan Risk Rating | 321 | |
Consumer Portfolio Segment [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loan Risk Rating | 286,026 | 125,447 |
Consumer Portfolio Segment [Member] | PCI loans acquired | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loan Risk Rating | 14 | 30 |
Consumer Portfolio Segment [Member] | Pass/Performing [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loan Risk Rating | 285,786 | 125,200 |
Consumer Portfolio Segment [Member] | Pass Watch [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loan Risk Rating | 196 | 215 |
Consumer Portfolio Segment [Member] | Special Mention [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loan Risk Rating | 2 | |
Consumer Portfolio Segment [Member] | Substandard [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loan Risk Rating | $ 28 | 2 |
Consumer Portfolio Segment [Member] | Doubtful [Member] | PCI loans acquired | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loan Risk Rating | $ 30 |
Loans and Allowance for Cred_11
Loans and Allowance for Credit Losses (Aging of Past Due Financing Receivables) (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Past due | $ 14,922 | $ 3,615 |
Nonaccrual | 1,908 | 2,004 |
Loans held for investment | $ 2,556,107 | $ 2,119,175 |
Percent of total loans, Total past due | 0.60% | 0.10% |
Percent of total loans, Nonaccrual | 0.10% | 0.10% |
Percent of total loans, Total loans | 100% | 100% |
Loans, net | $ 8,437 | |
PCI loans acquired | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Loans held for investment | $ 26,642 | $ 33,650 |
Percent of total loans, Total loans | 1% | 1.60% |
Current [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Past due | $ 2,512,635 | $ 2,079,906 |
Percent of total loans, Current | 98.30% | 98.20% |
Financing Receivables, 30 to 59 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Past due | $ 11,164 | $ 3,020 |
Percent of total loans, Total past due | 0.40% | 0.10% |
Financing Receivables, 60 to 89 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Past due | $ 1,917 | $ 87 |
Percent of total loans, Total past due | 0.10% | |
Financing Receivables, Equal to Greater than 90 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Past due | $ 1,841 | 508 |
Percent of total loans, Total past due | 0.10% | |
Residential Portfolio Segment [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Past due | $ 8,212 | 1,474 |
Nonaccrual | 1,259 | 803 |
Loans held for investment | 810,497 | 654,769 |
Residential Portfolio Segment [Member] | PCI loans acquired | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Loans held for investment | 13,956 | 17,326 |
Residential Portfolio Segment [Member] | Current [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Past due | 787,070 | 635,166 |
Residential Portfolio Segment [Member] | Financing Receivables, 30 to 59 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Past due | 6,214 | 1,371 |
Residential Portfolio Segment [Member] | Financing Receivables, 60 to 89 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Past due | 891 | 25 |
Residential Portfolio Segment [Member] | Financing Receivables, Equal to Greater than 90 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Past due | 1,107 | 78 |
Commercial Real Estate Portfolio Segment [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Past due | 1,079 | 679 |
Nonaccrual | 150 | 606 |
Loans held for investment | 1,065,409 | 896,229 |
Commercial Real Estate Portfolio Segment [Member] | PCI loans acquired | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Loans held for investment | 11,866 | 13,594 |
Commercial Real Estate Portfolio Segment [Member] | Current [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Past due | 1,052,314 | 881,350 |
Commercial Real Estate Portfolio Segment [Member] | Financing Receivables, 30 to 59 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Past due | 369 | 259 |
Commercial Real Estate Portfolio Segment [Member] | Financing Receivables, Equal to Greater than 90 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Past due | 710 | 420 |
Commercial Portfolio Segment [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Past due | 15 | 255 |
Nonaccrual | 174 | 298 |
Loans held for investment | 147,856 | 203,377 |
Commercial Portfolio Segment [Member] | PCI loans acquired | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Loans held for investment | 156 | 321 |
Commercial Portfolio Segment [Member] | Current [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Past due | 147,511 | 202,503 |
Commercial Portfolio Segment [Member] | Financing Receivables, 30 to 59 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Past due | 15 | 183 |
Commercial Portfolio Segment [Member] | Financing Receivables, 60 to 89 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Past due | 62 | |
Commercial Portfolio Segment [Member] | Financing Receivables, Equal to Greater than 90 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Past due | 10 | |
Consumer Portfolio Segment [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Past due | 234 | 287 |
Nonaccrual | 28 | |
Loans held for investment | 286,026 | 125,447 |
Consumer Portfolio Segment [Member] | PCI loans acquired | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Loans held for investment | 14 | 30 |
Consumer Portfolio Segment [Member] | Current [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Past due | 285,750 | 125,130 |
Consumer Portfolio Segment [Member] | Financing Receivables, 30 to 59 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Past due | 223 | 287 |
Consumer Portfolio Segment [Member] | Financing Receivables, 60 to 89 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Past due | 11 | |
Construction Loans [Member] | Commercial and Residential Real Estate Portfolio Segment [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Past due | 5,382 | 920 |
Nonaccrual | 297 | 297 |
Loans held for investment | 246,319 | 239,353 |
Construction Loans [Member] | Commercial and Residential Real Estate Portfolio Segment [Member] | PCI loans acquired | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Loans held for investment | 650 | 2,379 |
Construction Loans [Member] | Commercial and Residential Real Estate Portfolio Segment [Member] | Current [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Past due | 239,990 | 235,757 |
Construction Loans [Member] | Commercial and Residential Real Estate Portfolio Segment [Member] | Financing Receivables, 30 to 59 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Past due | 4,343 | $ 920 |
Construction Loans [Member] | Commercial and Residential Real Estate Portfolio Segment [Member] | Financing Receivables, 60 to 89 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Past due | 1,015 | |
Construction Loans [Member] | Commercial and Residential Real Estate Portfolio Segment [Member] | Financing Receivables, Equal to Greater than 90 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Past due | $ 24 |
Loans and Allowance for Cred_12
Loans and Allowance for Credit Losses (Allowance for Credit Losses on Financing Receivables) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Allowance for credit losses allocated to: | ||
Beginning balance | $ 13,944 | $ 13,888 |
Charge-offs | (588) | (263) |
Recoveries | 1,362 | 677 |
Net (charge-offs) recoveries | 774 | 414 |
Provision for credit losses | 1,925 | (358) |
Ending balance | 16,643 | 13,944 |
Commercial and Residential Real Estate Portfolio Segment [Member] | Construction Loans [Member] | ||
Allowance for credit losses allocated to: | ||
Beginning balance | 2,454 | 2,022 |
Recoveries | 13 | 278 |
Net (charge-offs) recoveries | 13 | 278 |
Provision for credit losses | 506 | 154 |
Ending balance | 2,973 | 2,454 |
Residential Portfolio Segment [Member] | ||
Allowance for credit losses allocated to: | ||
Beginning balance | 2,858 | 3,699 |
Charge-offs | (5) | |
Recoveries | 142 | 82 |
Net (charge-offs) recoveries | 137 | 82 |
Provision for credit losses | (373) | (923) |
Ending balance | 2,622 | 2,858 |
Commercial Real Estate Portfolio Segment [Member] | ||
Allowance for credit losses allocated to: | ||
Beginning balance | 4,598 | 5,426 |
Charge-offs | (6) | |
Recoveries | 951 | 114 |
Net (charge-offs) recoveries | 945 | 114 |
Provision for credit losses | (644) | (942) |
Ending balance | 4,899 | 4,598 |
Commercial Portfolio Segment [Member] | ||
Allowance for credit losses allocated to: | ||
Beginning balance | 2,070 | 2,089 |
Charge-offs | (546) | (235) |
Recoveries | 227 | 193 |
Net (charge-offs) recoveries | (319) | (42) |
Provision for credit losses | (99) | 23 |
Ending balance | 1,652 | 2,070 |
Consumer Portfolio Segment [Member] | ||
Allowance for credit losses allocated to: | ||
Beginning balance | 1,964 | 652 |
Charge-offs | (31) | (28) |
Recoveries | 29 | 10 |
Net (charge-offs) recoveries | (2) | (18) |
Provision for credit losses | 2,535 | 1,330 |
Ending balance | $ 4,497 | $ 1,964 |
Leases (Narrative) (Details)
Leases (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Option to extend lease term | true | |
Operating Lease, Lease Income, Statement of Income or Comprehensive Income [Extensible Enumeration] | Noninterest Income, Other Operating Income, In-Scope And Out-Of-Scope Of ASU 606 | Noninterest Income, Other Operating Income, In-Scope And Out-Of-Scope Of ASU 606 |
H.S. West, LLC [Member] | ||
Gross rental income | $ 1,300 | $ 180 |
Leases (Lease Information) (Det
Leases (Lease Information) (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Leases [Abstract] | ||
Lease liabilities | $ 9,908 | $ 11,567 |
Right-of-use assets | $ 9,629 | $ 11,370 |
Weighted average remaining lease term | 12 years 6 months 18 days | 13 years 7 months 9 days |
Weighted average discount rate | 2.50% | 2.48% |
Leases (Lease cost) (Details)
Leases (Lease cost) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Leases [Abstract] | ||
Operating lease cost | $ 1,355 | $ 902 |
Total lease cost | 1,355 | 902 |
Cash paid for amounts included in the measurement of lease liabilities | $ 1,268 | $ 777 |
Leases (Lease Payments Due) (De
Leases (Lease Payments Due) (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Leases [Abstract] | ||
2023 | $ 1,231 | |
2024 | 1,141 | |
2025 | 917 | |
2026 | 916 | |
2027 | 849 | |
Thereafter | 6,584 | |
Total undiscounted cash flows | 11,638 | |
Discount | 1,730 | |
Lease liabilities | $ 9,908 | $ 11,567 |
Leases (Minimum Future Annual R
Leases (Minimum Future Annual Rental Income) (Details) $ in Thousands | Dec. 31, 2022 USD ($) |
Minimum Future Annual Rental Income | |
2023 | $ 918 |
2024 | 701 |
2025 | 719 |
2026 | 737 |
2027 | 418 |
Thereafter | 1,554 |
Total | $ 5,047 |
Premises and Equipment (Narrati
Premises and Equipment (Narrative) (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Premises and Equipment [Abstract] | ||
Depreciation | $ 2.4 | $ 1.5 |
Premises and Equipment (Schedul
Premises and Equipment (Schedule of Property Plant and Equipment) (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Property, Plant and Equipment [Line Items] | ||
Premises and equipment, gross | $ 67,668 | $ 66,355 |
Accumulated depreciation | (16,180) | (14,731) |
Total | 51,488 | 51,624 |
Land [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Premises and equipment, gross | 10,886 | 10,886 |
Buildings and Land Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Premises and equipment, gross | 48,605 | 47,002 |
Furniture, Fixtures and Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Premises and equipment, gross | $ 8,177 | $ 8,467 |
Goodwill and Other Intangible_2
Goodwill and Other Intangibles (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Goodwill and Other Intangible Assets [Abstract] | ||
Amortization of other intangible assets | $ 1,988 | $ 734 |
Goodwill and Other Intangible_3
Goodwill and Other Intangibles (Schedule of Components of Goodwill and Other Acquired Intangible Assets) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Goodwill and Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 65,631 | $ 19,727 |
Adjustments | (155) | |
Additions | 45,904 | |
Accumulated Impairment Charges | (1,543) | (1,543) |
Accumulated Amortization | (667) | (667) |
Net carrying amount | 63,266 | 63,421 |
Other intangible assets, Amortizable, Gross Carrying Amount | 10,504 | 3,954 |
Other intangible assets, Amortizable, Additions | 6,550 | |
Other intangible assets, Amortizable, Accumulated Amortization | (4,957) | (2,969) |
Total amortizing intangible assets | 5,547 | 7,535 |
Core Deposits Intangible [Member] | ||
Goodwill and Intangible Assets [Line Items] | ||
Other intangible assets, Amortizable, Gross Carrying Amount | 10,504 | 3,954 |
Other intangible assets, Amortizable, Additions | 6,550 | |
Other intangible assets, Amortizable, Accumulated Amortization | (4,957) | (2,969) |
Total amortizing intangible assets | $ 5,547 | $ 7,535 |
Weighted Average Remaining Life (in years) | 2 years 7 months 6 days | 2 years 10 months 24 days |
Goodwill and Other Intangible_4
Goodwill and Other Intangibles (Future Amortization Expense for Amortizable Other Intangible Assets) (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Goodwill and Other Intangible Assets [Abstract] | ||
2023 | $ 1,682 | |
2024 | 1,376 | |
2025 | 1,070 | |
2026 | 765 | |
2027 | 459 | |
Thereafter | 195 | |
Total amortizing intangible assets | $ 5,547 | $ 7,535 |
Other Assets (Schedule of Other
Other Assets (Schedule of Other Assets) (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Other Assets [Abstract] | ||
Accrued interest receivable | $ 9,384 | $ 6,719 |
Deferred income taxes | 7,357 | 2,926 |
Prepaid expenses | 2,680 | 2,865 |
Income taxes receivable | 74 | 616 |
Other assets | 8,506 | 6,806 |
Total | $ 28,001 | $ 19,932 |
Other Liabilities (Schedule of
Other Liabilities (Schedule of Other Liabilities) (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Other Liabilities [Abstract] | ||
Accrued interest payable | $ 989 | $ 692 |
Accrued salaries and wages | 1,360 | 3,422 |
Accounts payable | 353 | 2,745 |
Deferred compensation liability | 5,679 | 4,660 |
Other liabilities | 1,846 | 3,081 |
Total | $ 10,227 | $ 14,600 |
Deposits (Narrative) (Details)
Deposits (Narrative) (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Certificate of deposit at or over $250,000 | $ 77,700 | $ 78,000 |
Deposits | 3,009,784 | 3,026,236 |
Brokered deposits | 0 | 0 |
Directors, Associates and Policy Making Officers [Member] | ||
Deposits | $ 11,900 | $ 7,700 |
Deposits (Schedule of Deposits)
Deposits (Schedule of Deposits) (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Deposits [Abstract] | ||
Time deposits maturity, Due in one year or less | $ 231,089 | $ 291,685 |
Time deposits maturity, Due in one to three years | 162,216 | 128,222 |
Time deposits maturity, Due in three to five years | 31,417 | 40,044 |
Time Deposits, Total | $ 424,722 | $ 459,951 |
Borrowings (Schedule of Short-t
Borrowings (Schedule of Short-term and Long-term Borrowings) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Retail Repurchase Agreements [Member] | ||
Short-term Debt [Line Items] | ||
Short-term borrowings, Average for the Year | $ 683 | $ 3,017 |
Short-term borrowings, weighted interest rate, Average for the Year | 0.25% | 0.25% |
Short-term borrowings, At Year End | $ 4,143 | |
Short-term borrowings, weighted average rate, At Year End | 0.18% | |
Federal Home Loan Bank Advances [Member] | ||
Short-term Debt [Line Items] | ||
FHLB Advances - long-term, Average for the Year | $ 1,863 | |
FHLB Advances - long-term, weighted interest rate, Average for the Year | 3.87% | |
Short-term borrowings, At Year End | $ 40,000 | $ 0 |
FHLB Advances - long-term, weighted interest rate, At Year End | 4.57% |
Borrowings (Narrative) (Details
Borrowings (Narrative) (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 | Oct. 31, 2021 |
Severn Bancorp, Inc. | |||
Short-term Debt [Line Items] | |||
Advances from FHLB - long-term | $ 10,000 | ||
Purchase premium | $ 162 | ||
Federal Home Loan Bank Advances [Member] | |||
Short-term Debt [Line Items] | |||
Debt Instrument, Interest Rate, Effective Percentage | 2.19% | ||
Line of Credit [Member] | Federal Funds Line Of Credit And Reverse Repurchase Agreement [Member] | |||
Short-term Debt [Line Items] | |||
Short-term Debt, Total | $ 15,000 | $ 15,000 | |
Federal Home Loan Bank Advances [Member] | |||
Short-term Debt [Line Items] | |||
Short-term Debt, Total | 40,000 | 0 | |
Federal Home Loan Bank Advances [Member] | Secured Credit [Member] | |||
Short-term Debt [Line Items] | |||
Line of Credit Facility, Remaining Borrowing Capacity | $ 298,900 | $ 363,900 |
Subordinated Debt (Details)
Subordinated Debt (Details) - USD ($) $ in Thousands | Aug. 25, 2020 | Dec. 31, 2022 | Dec. 31, 2021 | Oct. 31, 2021 |
Debt Instrument [Line Items] | ||||
Subordinated Debt | $ 43,072 | $ 42,762 | ||
Severn Subordinated Debt [Member] | ||||
Debt Instrument [Line Items] | ||||
Subordinated Debt | 24,700 | |||
Unamortized issuance costs | $ 326 | |||
Subordinated Debt [Member] | ||||
Debt Instrument [Line Items] | ||||
Principal amount | $ 25,000 | |||
Interest Rate | 5.375% | |||
Payments of Debt Issuance Costs | $ 611 | |||
Subordinated Debt [Member] | SOFR | ||||
Debt Instrument [Line Items] | ||||
Basis Spread on Variable Rate | 526.50% | |||
Subordinated Debt [Member] | Debentures Due 2035 | Severn Bancorp, Inc. | ||||
Debt Instrument [Line Items] | ||||
Principal amount | $ 20,600 |
Benefit Plans (Narrative) (Deta
Benefit Plans (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Benefit Plans [Abstract] | ||
Defined contribution plan, employer discretionary contribution amount | $ 1,300 | $ 696 |
Stock-Based Compensation (Narra
Stock-Based Compensation (Narrative) (Details) - Equity Plan 2016 [Member] - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Award description | The Company may issue shares of common stock or grant other equity-based awards pursuant to the 2016 Equity Plan. Stock-based awards granted to date generally are time-based, vest in equal installments on each anniversary of the grant date and range over a one- to three-year period of time, and, in the case of stock options, expire 10 years from the grant date. As part of the 2016 Equity Plan, a performance equity incentive award program, known as the “Long-term incentive plan” allows participating officers of the Company to earn incentive awards of performance share/restricted stock units if certain pre-determined targets are achieved at the end of a three-year performance cycle. Stock-based compensation expense based on the grant date fair value is recognized ratably over the requisite service period for all awards and reflects forfeitures as they occur. | |
Stock Appreciation Rights (SARs) [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Award expiration | 10 years | |
Employee Stock Option [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Options, granted, weighted average fair value | $ 0 | $ 0 |
Restricted Stock [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Other than options, vested, fair value | $ 532 | $ 309 |
Time Based Restricted Stock Awards [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Shares authorized for granting | 750,000 | |
Shares available to be granted | 499,870 | |
Maximum [Member] | Time Based Restricted Stock Awards [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Award vesting period | 3 years | |
Minimum [Member] | Time Based Restricted Stock Awards [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Award vesting period | 1 year |
Stock-Based Compensation (Sched
Stock-Based Compensation (Schedule of Stock-Based Compensation) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Stock-Based Compensation [Abstract] | ||
Stock-based compensation expense | $ 636 | $ 378 |
Excess tax benefits related to stock-based compensation | 42 | 9 |
Unrecognized stock-based compensation expense | $ 138 | $ 80 |
Weighted average period unrecognized expense is expected to be recognized | 2 months 12 days | 2 months 12 days |
Stock-Based Compensation (Sch_2
Stock-Based Compensation (Schedule of Stock-Based Compensation, RS and RSU Award Activity) (Details) - Equity Plan 2016 [Member] - Restricted Stock [Member] - $ / shares | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of Shares, Nonvested at beginning of period (in shares) | 29,425 | 24,505 |
Number of Shares, Granted (in shares) | 34,184 | 26,583 |
Number of Shares, Vested (in shares) | (26,749) | (20,240) |
Number of Shares, Forfeited (in shares) | (1,423) | |
Number of Shares, Nonvested at end of period (in shares) | 36,860 | 29,425 |
Weighted Average Grant Date Fair Value, Nonvested at beginning of period (in dollars per share) | $ 13.95 | $ 13.78 |
Weighted Average Grant Date Fair Value, Granted (in dollars per share) | 20.48 | 13.81 |
Weighted Average Grant Date Fair Value, Vested (in dollars per share) | 13.75 | 13.54 |
Weighted Average Grant Date Fair Value, Forfeited (in dollars per share) | 13.34 | |
Weighted Average Grant Date Fair Value, Nonvested at end of period (in dollars per share) | $ 20.15 | $ 13.95 |
Derivatives (Narrative) (Detail
Derivatives (Narrative) (Details) - Interest Rate Lock Commitments [Member] | 12 Months Ended |
Dec. 31, 2022 | |
Minimum [Member] | |
Derivatives, Fair Value [Line Items] | |
Period between issuance of loan commitment and closing and sale of loan | 14 days |
Maximum [Member] | |
Derivatives, Fair Value [Line Items] | |
Period between issuance of loan commitment and closing and sale of loan | 120 days |
Derivatives (Carrying Amounts o
Derivatives (Carrying Amounts of Derivative Financial Instruments ) (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Interest Rate Lock Commitments [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative asset, notional amount | $ 4,166 | $ 17,557 |
Derivative asset, estimated fair value | 35 | 380 |
Derivative liability, notional amount | 1,150 | |
Derivative liability, estimated fair value | 7 | |
TBA securities [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative asset, notional amount | 8,750 | 26,500 |
Derivative asset, estimated fair value | 41 | 55 |
Derivative liability, notional amount | 1,000 | 20,500 |
Derivative liability, estimated fair value | $ 6 | $ 41 |
Deferred Compensation (Narrativ
Deferred Compensation (Narrative) (Details) - Management and Highly Compensated Employees [Member] - Executive Deferred Compensation Plan [Member] | 12 Months Ended |
Dec. 31, 2022 | |
Deferred Compensation Arrangement with Individual, Share-based Payments [Line Items] | |
Deferred compensation arrangement with individual, description | Company has multiple deferred compensation agreements with current and former employees. The Executive Deferred Compensation Plan (the “Plan”) is reserved for members of management and highly compensated employees of the Company and the Bank. During 2019, the Plan was expanded to include additional officers who had not previously participated. The Plan permits a participant to elect, each year, to defer receipt of up to 100% of his or her salary and bonus to be earned in the following year. The Plan also permits the participant to defer the receipt of performance-based compensation not later than six months before the end of the period for which it is to be earned. |
Employee percentage of salary, maximum | 100% |
Award vesting period | 5 years |
Deferred Compensation (Schedule
Deferred Compensation (Schedule of Deferred Compensation Arrangement) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Deferred Compensation [Abstract] | ||
Elected Deferrals | $ 238 | $ 192 |
Deferred compensation liability | $ 948 | $ 972 |
Deferred Compensation (Schedu_2
Deferred Compensation (Schedule of Deferred Compensation Arrangement in Other Assets and Other Liabilities) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Cash surrender value | $ 59,218 | $ 47,935 |
Deferred compensation liability -SERP | 948 | 972 |
SERP Plan | ||
Cash surrender value | 56,117 | 38,414 |
Deferred compensation liability -SERP | 4,177 | 3,114 |
SERP Expense | 1,063 | 1,455 |
Former Directors from CNB [Member] | ||
Cash surrender value | 2,260 | 2,200 |
Deferred compensation liability -SERP | $ 450 | $ 554 |
Other Expenses (Schedule of Oth
Other Expenses (Schedule of Other Noninterest Expenses) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Other Expenses [Abstract] | ||
Advertising and marketing | $ 898 | $ 339 |
Other customer expense | 1,075 | 693 |
Other expense | 3,694 | 2,425 |
Other loan expense | 1,670 | 188 |
Software expense | 1,853 | 1,048 |
Travel and entertainment expense | 478 | 216 |
Trust professional fees | 409 | 524 |
Total noninterest expense | $ 10,077 | $ 5,433 |
Income Taxes (Schedule of Compo
Income Taxes (Schedule of Components of Income Tax Expense (Benefit) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Current tax expense: | ||
Federal | $ 8,814 | $ 3,920 |
State | 3,332 | 1,614 |
Current income tax expense (benefit), total | 12,146 | 5,534 |
Deferred income tax (benefit) expense: | ||
Federal | (911) | 136 |
State | (271) | 142 |
Deferred income tax expense (benefit), total | (1,182) | 278 |
Total income tax expense | $ 10,964 | $ 5,812 |
Income Taxes (Schedule of Effec
Income Taxes (Schedule of Effective Income Tax Rate Reconciliation) (Details) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Income Taxes [Abstract] | ||
Tax at federal statutory rate | 21% | 21% |
Tax effect of: | ||
Tax-exempt income | 1% | 1.60% |
State income taxes, net of federal benefit | 5.70% | 6.60% |
Other | 0.30% | 1.40% |
Actual income tax expense rate | 26% | 27.40% |
Income Taxes (Schedule of Defer
Income Taxes (Schedule of Deferred Tax Assets and Liabilities) (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Deferred tax assets: | ||
Allowance for credit losses | $ 4,460 | $ 3,728 |
Write-downs of other real estate owned | 21 | 12 |
Nonaccrual loan interest | 345 | 253 |
Lease liabilities | 2,635 | 3,021 |
Deferred compensation | 1,522 | 1,246 |
Deferred loan costs | 1,183 | 730 |
Unrealized losses on available-for-sale securities | 3,399 | |
Other | 1,487 | 903 |
Total deferred tax assets | 15,052 | 9,893 |
Less valuation allowance | (791) | (474) |
Deferred tax assets net of valuation allowance | 14,261 | 9,419 |
Deferred tax liabilities: | ||
Depreciation | 2,491 | 1,030 |
Right-of-use assets | 2,560 | 2,968 |
Mortgage servicing rights | 1,405 | 1,084 |
Amortization on loans FMV adjustment | 57 | 986 |
Deferred capital gain on branch sale | 220 | 228 |
Unrealized gains on available-for-sale securities | 13 | |
Other | 171 | 184 |
Total deferred tax liabilities | 6,904 | 6,493 |
Net deferred tax assets | $ 7,357 | $ 2,926 |
Earnings Per Common Share (Calc
Earnings Per Common Share (Calculation of Earnings Per Common Share) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||
Dec. 31, 2022 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | |
Earnings Per Share [Abstract] | ||||||||||
Net income | $ 8,407 | $ 9,658 | $ 7,499 | $ 5,613 | $ 2,723 | $ 4,616 | $ 4,031 | $ 3,998 | $ 31,177 | $ 15,368 |
Weighted average shares outstanding - Basic (in shares) | 19,847,000 | 13,119,000 | ||||||||
Earnings per common share - Basic | $ 1.57 | $ 1.17 | ||||||||
Earnings per common share - Diluted | $ 1.57 | $ 1.17 | ||||||||
Weighted average common stock excluded from calculation of diluted EPS | 0 | 0 |
Regulatory Capital Requiremen_3
Regulatory Capital Requirements (Narrative) (Details) $ in Millions | 3 Months Ended | 12 Months Ended |
Dec. 31, 2021 USD ($) | Dec. 31, 2022 | |
Regulatory Capital Requirements [Abstract] | ||
Capital conservation buffer, minimum ratios, as a percent | 0.025% | |
Common Equity Tier 1 required for capital adequacy purposes, ratio (as a percent) | 0.07% | |
Tier One Risk Based Capital Required For Capital Adequacy With Buffer To Risk Weighted Assets | 0.0850 | |
Capital Required for Capital Adequacy to Risk Weighted Assets | 0.1050 | |
Tier One Leverage Capital Required for Capital Adequacy to Average Assets | 0.0400 | |
Common Equity Tier 1 required for well capitalized to risk weighted assets (as a percent) | 0.065% | |
Tier One Risk Based Capital Required to be Well Capitalized to Risk Weighted Assets | 0.0800 | |
Capital Required to be Well Capitalized to Risk Weighted Assets | 0.1000 | |
Tier One Leverage Capital Required to be Well Capitalized to Average Assets | 0.0500 | |
Dividend issued | $ 25 |
Regulatory Capital Requiremen_4
Regulatory Capital Requirements (Schedule of Capital Amount and Ratios) (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Common Equity Tier 1 Capital | $ 304,493 | $ 279,681 |
Tier 1 Capital | 322,891 | |
Total Risk Based Capital | 364,419 | 336,696 |
Net Risk Weighted Assets | 2,619,400 | 2,191,557 |
Adjusted Average Total Assets | $ 3,390,516 | $ 2,966,412 |
Common Equity Tier 1 ratio | 0.1162% | 0.1276% |
Tier 1 Risk-Based Capital Ratio | 0.1233 | 0.1276 |
Total Risk-Based Capital Ratio | 0.1391 | 0.1536 |
Tier 1 Leverage Ratio | 0.0952 | 0.0943 |
Shore United Bank [Member] | ||
Common Equity Tier 1 Capital | $ 335,802 | $ 304,362 |
Tier 1 Capital | 335,802 | |
Total Risk Based Capital | 352,657 | 318,614 |
Net Risk Weighted Assets | 2,618,939 | 2,189,775 |
Adjusted Average Total Assets | $ 3,386,771 | $ 2,965,319 |
Common Equity Tier 1 ratio | 0.1282% | 0.139% |
Tier 1 Risk-Based Capital Ratio | 0.1282 | 0.1390 |
Total Risk-Based Capital Ratio | 0.1347 | 0.1455 |
Tier 1 Leverage Ratio | 0.0992 | 0.0948 |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive Income (loss) (Schedule of Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Balances | $ 350,693 | $ 195,019 |
Other comprehensive income (loss) | (9,077) | (1,473) |
Balances | 364,285 | 350,693 |
Accumulated Other Comprehensive Income (loss) [Member] | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Balances | 56 | 1,529 |
Balances | (9,021) | 56 |
Accumulated Net Unrealized Investment Gain (Loss) [Member] | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Balances | 56 | 1,529 |
Other comprehensive income (loss) | (9,077) | (1,473) |
Balances | $ (9,021) | $ 56 |
Fair Value Measurements (Estima
Fair Value Measurements (Estimated Fair Value and Range) (Details) $ in Thousands | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
MSRs | $ 5,275 | $ 4,087 |
Interest Rate Lock Commitments [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
IRLCs - Derivative Asset | 35 | 380 |
Fair Value, Inputs, Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
MSRs | 5,275 | 4,087 |
Fair Value, Inputs, Level 3 [Member] | Interest Rate Lock Commitments [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
IRLCs - Derivative Asset | 35 | 380 |
Market Approach | Weighted average prepayment speed (PSA) | Fair Value, Inputs, Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
MSRs | $ 5,275 | $ 4,087 |
MSRs Range | 121 | 156 |
Market Approach | Range of pull through rate | Fair Value, Inputs, Level 3 [Member] | Interest Rate Lock Commitments [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
IRLCs - Derivative Asset | $ 28 | $ 380 |
Minimum [Member] | Market Approach | Range of pull through rate | Fair Value, Inputs, Level 3 [Member] | Interest Rate Lock Commitments [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
IRLCs Range | 78 | 77 |
Maximum [Member] | Market Approach | Range of pull through rate | Fair Value, Inputs, Level 3 [Member] | Interest Rate Lock Commitments [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
IRLCs Range | 100 | 100 |
Arithmetic Average [Member] | Interest Rate Lock Commitments [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
IRLCs Range | 92 | 93 |
Fair Value Measurements (Activi
Fair Value Measurements (Activity in MSRs) (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2022 USD ($) | |
Fair Value Measurements [Abstract] | |
Beginning balance | $ 4,087 |
Servicing rights resulting from sales of loans | 816 |
Valuation adjustment | 372 |
Ending balance | $ 5,275 |
Fair Value Measurements (Acti_2
Fair Value Measurements (Activity in IRLCs) (Details) - Interest Rate Lock Commitments [Member] $ in Thousands | 12 Months Ended |
Dec. 31, 2022 USD ($) | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Beginning Balance | $ 380 |
Valuation adjustment | (352) |
Ending Balance | $ 28 |
Fair Value Measurements (Assets
Fair Value Measurements (Assets and Liabilities Measured on Recurring Basis) (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Investment securities: | ||
Investment securities available for sale, at fair value | $ 83,587 | $ 116,982 |
Equity securities, at fair value | 1,233 | 1,372 |
LHFS | 4,248 | 37,749 |
LHFI | 8,437 | |
MSRs | 5,275 | 4,087 |
Total assets at fair value | 102,856 | 160,625 |
Total liabilities at fair value | 13 | 41 |
Fair Value, Inputs, Level 2 [Member] | ||
Investment securities: | ||
Investment securities available for sale, at fair value | 83,587 | 116,982 |
Equity securities, at fair value | 1,233 | 1,372 |
LHFS | 4,248 | 37,749 |
LHFI | 8,437 | |
Total assets at fair value | 97,546 | 156,158 |
Total liabilities at fair value | 6 | 41 |
Fair Value, Inputs, Level 3 [Member] | ||
Investment securities: | ||
MSRs | 5,275 | 4,087 |
Total assets at fair value | 5,310 | 4,467 |
Total liabilities at fair value | 7 | |
U.S. Government Agencies [Member] | ||
Investment securities: | ||
Investment securities available for sale, at fair value | 18,178 | 22,305 |
U.S. Government Agencies [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Investment securities: | ||
Investment securities available for sale, at fair value | 18,178 | 22,305 |
Mortgage-backed [Member] | ||
Investment securities: | ||
Investment securities available for sale, at fair value | 63,519 | 92,637 |
Mortgage-backed [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Investment securities: | ||
Investment securities available for sale, at fair value | 63,519 | 92,637 |
Other debt securities [Member] | ||
Investment securities: | ||
Investment securities available for sale, at fair value | 1,890 | 2,040 |
Other debt securities [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Investment securities: | ||
Investment securities available for sale, at fair value | 1,890 | 2,040 |
Interest Rate Lock Commitments [Member] | ||
Investment securities: | ||
IRLCs - Derivative Asset | 35 | 380 |
IRLCs - Derivative Liability | 7 | |
Interest Rate Lock Commitments [Member] | Fair Value, Inputs, Level 3 [Member] | ||
Investment securities: | ||
IRLCs - Derivative Asset | 35 | 380 |
IRLCs - Derivative Liability | 7 | |
TBA securities [Member] | ||
Investment securities: | ||
IRLCs - Derivative Asset | 41 | 55 |
IRLCs - Derivative Liability | 6 | 41 |
TBA securities [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Investment securities: | ||
IRLCs - Derivative Asset | 41 | 55 |
IRLCs - Derivative Liability | $ 6 | $ 41 |
Fair Value Measurements (Fair V
Fair Value Measurements (Fair Value of Assets Measured on Nonrecurring Basis) (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Appraisal Of Collateral [Member] | Weighted Average [Member] | ||
Impaired loans: | ||
Impaired loans, Liquidation expense, Range | 10% | |
Other real estate owned, Appraisal adjustment, Range | 2% | 35% |
Discounted Cash Flow Analysis [Member] | Weighted Average [Member] | ||
Impaired loans: | ||
Impaired loans, Liquidation expense, Range | 6% | |
Impaired loans, Discount rate, Range | 6% | |
Fair Value, Inputs, Level 3 [Member] | Fair Value, Measurements, Nonrecurring [Member] | Appraisal Of Collateral [Member] | ||
Impaired loans: | ||
Impaired loans | $ 617 | |
Other real estate owned | $ 197 | $ 532 |
Impaired loans, Liquidation expense, Range | 10% | |
Fair Value, Inputs, Level 3 [Member] | Fair Value, Measurements, Nonrecurring [Member] | Appraisal Of Collateral [Member] | Maximum [Member] | ||
Impaired loans: | ||
Other real estate owned, Appraisal adjustment, Range | 20% | 40% |
Fair Value, Inputs, Level 3 [Member] | Fair Value, Measurements, Nonrecurring [Member] | Appraisal Of Collateral [Member] | Minimum [Member] | ||
Impaired loans: | ||
Other real estate owned, Appraisal adjustment, Range | 0% | 20% |
Fair Value, Inputs, Level 3 [Member] | Fair Value, Measurements, Nonrecurring [Member] | Discounted Cash Flow Analysis [Member] | ||
Impaired loans: | ||
Impaired loans | $ 1,412 | $ 2,026 |
Fair Value, Inputs, Level 3 [Member] | Fair Value, Measurements, Nonrecurring [Member] | Discounted Cash Flow Analysis [Member] | Maximum [Member] | ||
Impaired loans: | ||
Impaired loans, Discount rate, Range | 6.50% | 7.25% |
Fair Value, Inputs, Level 3 [Member] | Fair Value, Measurements, Nonrecurring [Member] | Discounted Cash Flow Analysis [Member] | Minimum [Member] | ||
Impaired loans: | ||
Impaired loans, Discount rate, Range | 6% | 4% |
Fair Value Measurements (Esti_2
Fair Value Measurements (Estimated Fair Values of Financial Assets and Liabilities) (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Financial assets, Estimated Fair Value | ||
Investment securities available for sale, at fair value | $ 83,587 | $ 116,982 |
Investment securities held to maturity | 494,627 | 401,524 |
LHFS | 4,248 | 37,749 |
Loans, net | 8,437 | |
MSRs | 5,275 | 4,087 |
Interest Rate Lock Commitments [Member] | ||
Financial assets, Estimated Fair Value | ||
Derivative asset, estimated fair value | 35 | 380 |
Financial liabilities, Estimated Fair Value | ||
IRLCs - Derivative Liability | 7 | |
TBA securities [Member] | ||
Financial assets, Estimated Fair Value | ||
Derivative asset, estimated fair value | 41 | 55 |
Financial liabilities, Estimated Fair Value | ||
IRLCs - Derivative Liability | 6 | 41 |
Carrying Amount [Member] | ||
Financial assets, Estimated Fair Value | ||
Loans, net | 8,437 | |
Estimated Fair Value [Member] | ||
Financial assets, Estimated Fair Value | ||
Loans, net | 8,437 | |
Fair Value, Inputs, Level 1 [Member] | Carrying Amount [Member] | ||
Financial assets, Estimated Fair Value | ||
Cash and cash equivalents | 55,499 | 583,613 |
Fair Value, Inputs, Level 1 [Member] | Estimated Fair Value [Member] | ||
Financial assets, Estimated Fair Value | ||
Cash and cash equivalents | 55,499 | 583,613 |
Fair Value, Inputs, Level 2 [Member] | ||
Financial assets, Estimated Fair Value | ||
Investment securities available for sale, at fair value | 83,587 | 116,982 |
LHFS | 4,248 | 37,749 |
Loans, net | 8,437 | |
Fair Value, Inputs, Level 2 [Member] | TBA securities [Member] | ||
Financial assets, Estimated Fair Value | ||
Derivative asset, estimated fair value | 41 | 55 |
Financial liabilities, Estimated Fair Value | ||
IRLCs - Derivative Liability | 6 | 41 |
Fair Value, Inputs, Level 2 [Member] | Carrying Amount [Member] | ||
Financial assets, Estimated Fair Value | ||
Investment securities available for sale, at fair value | 83,587 | 116,982 |
Investment securities held to maturity | 559,455 | 404,594 |
Equity securities | 1,233 | 1,372 |
Restricted securities | 11,169 | 4,159 |
LHFS | 4,248 | 37,749 |
Cash surrender value on life insurance | 59,218 | 47,935 |
Financial liabilities, Estimated Fair Value | ||
Noninterest-bearing demand | 862,015 | 927,497 |
Checking plus interest | 694,101 | 524,143 |
Money market | 709,132 | 889,099 |
Savings | 319,814 | 225,546 |
Club | 374 | 388 |
Certificates of deposit | 424,348 | 459,563 |
Securities sold under retail repurchase agreement | 4,143 | |
Advances from FHLB - short-term | 40,000 | |
Advances from FHLB - long-term | 10,135 | |
Subordinated debt | 43,072 | 42,762 |
IRLCs - Derivative Liability | 6 | 41 |
Fair Value, Inputs, Level 2 [Member] | Carrying Amount [Member] | TBA securities [Member] | ||
Financial assets, Estimated Fair Value | ||
Derivative asset, estimated fair value | 41 | 55 |
Fair Value, Inputs, Level 2 [Member] | Estimated Fair Value [Member] | ||
Financial assets, Estimated Fair Value | ||
Investment securities available for sale, at fair value | 83,587 | 116,982 |
Investment securities held to maturity | 494,626 | 401,524 |
Equity securities | 1,233 | 1,372 |
Restricted securities | 11,169 | 4,159 |
LHFS | 4,248 | 37,749 |
Cash surrender value on life insurance | 59,218 | 47,935 |
Financial liabilities, Estimated Fair Value | ||
Noninterest-bearing demand | 862,015 | 927,497 |
Checking plus interest | 694,101 | 524,143 |
Money market | 709,132 | 889,099 |
Savings | 319,814 | 225,546 |
Club | 374 | 388 |
Certificates of deposit | 410,455 | 461,135 |
Securities sold under retail repurchase agreement | 4,143 | |
Advances from FHLB - short-term | 40,002 | |
Advances from FHLB - long-term | 10,187 | |
Subordinated debt | 41,193 | 44,876 |
IRLCs - Derivative Liability | 6 | 41 |
Fair Value, Inputs, Level 2 [Member] | Estimated Fair Value [Member] | TBA securities [Member] | ||
Financial assets, Estimated Fair Value | ||
Derivative asset, estimated fair value | 41 | 55 |
Fair Value, Inputs, Level 3 [Member] | ||
Financial assets, Estimated Fair Value | ||
MSRs | 5,275 | 4,087 |
Fair Value, Inputs, Level 3 [Member] | Interest Rate Lock Commitments [Member] | ||
Financial assets, Estimated Fair Value | ||
Derivative asset, estimated fair value | 35 | 380 |
Financial liabilities, Estimated Fair Value | ||
IRLCs - Derivative Liability | 7 | |
Fair Value, Inputs, Level 3 [Member] | Carrying Amount [Member] | ||
Financial assets, Estimated Fair Value | ||
Loans, net | 2,531,027 | 2,105,231 |
MSRs | 5,275 | 4,087 |
Fair Value, Inputs, Level 3 [Member] | Carrying Amount [Member] | Interest Rate Lock Commitments [Member] | ||
Financial assets, Estimated Fair Value | ||
Derivative asset, estimated fair value | 35 | 380 |
Financial liabilities, Estimated Fair Value | ||
IRLCs - Derivative Liability | 7 | |
Fair Value, Inputs, Level 3 [Member] | Estimated Fair Value [Member] | ||
Financial assets, Estimated Fair Value | ||
Loans, net | 2,431,808 | 2,106,373 |
MSRs | 5,275 | 4,087 |
Fair Value, Inputs, Level 3 [Member] | Estimated Fair Value [Member] | Interest Rate Lock Commitments [Member] | ||
Financial assets, Estimated Fair Value | ||
Derivative asset, estimated fair value | 35 | $ 380 |
Financial liabilities, Estimated Fair Value | ||
IRLCs - Derivative Liability | $ 7 |
Commitments and Contingencies_2
Commitments and Contingencies (Schedule of Commitments Outstanding) (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Commitments outstanding | $ 414,362 | $ 429,487 |
Commitments to Extend Credit [Member] | ||
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Commitments outstanding | 406,353 | 421,088 |
Letters of Credit [Member] | ||
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Commitments outstanding | $ 8,009 | $ 8,399 |
Commitments and Contingencies_3
Commitments and Contingencies (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Deposits | $ 3,009,784 | $ 3,026,236 |
Gross loans | 2,539,464 | 2,105,231 |
Interest Income | 113,845 | 70,169 |
Noninterest income | 23,086 | $ 13,498 |
Business Activities With Medical Use Cannabis Customers | Medical Use Cannabis Customers | ||
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Deposits | $ 131,700 | |
Deposits with customers as percentage of total deposits | 4.40% | |
Gross loans | $ 54,900 | |
Loans with customers as percentage of total loans | 2.20% | |
Interest Income | $ 4,900 | |
Noninterest income | $ 2,000 |
Segment Reporting (Schedule of
Segment Reporting (Schedule of Segment Reporting Information by Segment) (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||
Dec. 31, 2022 USD ($) | Sep. 30, 2022 USD ($) | Jun. 30, 2022 USD ($) | Mar. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Sep. 30, 2021 USD ($) | Jun. 30, 2021 USD ($) | Mar. 31, 2021 USD ($) | Dec. 31, 2022 USD ($) segment | Dec. 31, 2021 USD ($) segment | |
Segment Reporting Information [Line Items] | ||||||||||
Number of operating segments | segment | 2 | 2 | ||||||||
Interest Income | $ 113,845 | $ 70,169 | ||||||||
Interest Expense | 12,543 | 6,039 | ||||||||
Net interest income | 101,302 | 64,130 | ||||||||
Provision for credit losses | 1,925 | (358) | ||||||||
Net interest income after provision for credit losses | 99,377 | 64,488 | ||||||||
Noninterest income | 23,086 | 13,498 | ||||||||
Noninterest expense | 80,322 | 56,806 | ||||||||
Income before income taxes | 42,141 | 21,180 | ||||||||
Income tax expense | 10,964 | 5,812 | ||||||||
Net income | $ 8,407 | $ 9,658 | $ 7,499 | $ 5,613 | $ 2,723 | $ 4,616 | $ 4,031 | $ 3,998 | 31,177 | 15,368 |
Total assets | 3,477,276 | 3,460,136 | 3,477,276 | 3,460,136 | ||||||
Community Banking [Member] | ||||||||||
Segment Reporting Information [Line Items] | ||||||||||
Interest Income | 113,253 | 70,037 | ||||||||
Interest Expense | 12,501 | 6,031 | ||||||||
Net interest income | 100,752 | 64,006 | ||||||||
Provision for credit losses | 1,925 | (358) | ||||||||
Net interest income after provision for credit losses | 98,827 | 64,364 | ||||||||
Noninterest income | 17,876 | 12,550 | ||||||||
Noninterest expense | 75,267 | 55,628 | ||||||||
Income before income taxes | 41,436 | 21,286 | ||||||||
Income tax expense | 10,782 | 5,841 | ||||||||
Net income | 30,654 | 15,445 | ||||||||
Total assets | 3,467,548 | 3,416,519 | 3,467,548 | 3,416,519 | ||||||
Mortgage Banking [Member] | ||||||||||
Segment Reporting Information [Line Items] | ||||||||||
Interest Income | 592 | 132 | ||||||||
Interest Expense | 42 | 8 | ||||||||
Net interest income | 550 | 124 | ||||||||
Net interest income after provision for credit losses | 550 | 124 | ||||||||
Noninterest income | 5,210 | 948 | ||||||||
Noninterest expense | 5,055 | 1,178 | ||||||||
Income before income taxes | 705 | (106) | ||||||||
Income tax expense | 182 | (29) | ||||||||
Net income | 523 | (77) | ||||||||
Total assets | $ 9,728 | $ 43,617 | $ 9,728 | $ 43,617 |
Related Party Transactions (Nar
Related Party Transactions (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Law Firm With Common Partner [Member] | ||
Lease rent payment | $ 305 | $ 50 |
Pending Merger (Details)
Pending Merger (Details) $ in Thousands | 12 Months Ended | ||
Dec. 14, 2022 shares | Dec. 31, 2022 USD ($) Office | Dec. 31, 2021 USD ($) | |
Business Acquisition [Line Items] | |||
Number of Shares to be Issued for each share | shares | 2.3287 | ||
Percentage of ownership Interests | 60% | ||
Assets | $ | $ 3,477,276 | $ 3,460,136 | |
MARYLAND | |||
Business Acquisition [Line Items] | |||
Number of Community Banking Offices | Office | 10 | ||
VIRGINIA | |||
Business Acquisition [Line Items] | |||
Number of Community Banking Offices | Office | 2 | ||
Minimum [Member] | |||
Business Acquisition [Line Items] | |||
Percentage of ownership Interests | 40% | ||
Assets | $ | $ 2,400,000 |
Parent Company Financial Info_3
Parent Company Financial Information (Condensed Balance Sheets, Parent Only) (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2020 |
Assets | |||||||||
Premises and equipment, net | $ 51,488 | $ 51,624 | |||||||
Other assets | 28,001 | 19,932 | |||||||
TOTAL ASSETS | 3,477,276 | 3,460,136 | |||||||
Liabilities | |||||||||
Other liabilities | 10,227 | 14,600 | |||||||
TOTAL LIABILITIES | 3,112,991 | 3,109,443 | |||||||
Stockholders' equity | |||||||||
Common stock | 199 | 198 | |||||||
Additional paid in capital | 201,494 | 200,473 | |||||||
Retained earnings | 171,613 | 149,966 | |||||||
Accumulated other comprehensive income | (9,021) | 56 | |||||||
Total stockholders' equity | 364,285 | $ 357,221 | $ 352,777 | $ 351,864 | 350,693 | $ 201,607 | $ 198,682 | $ 196,104 | $ 195,019 |
Total liabilities and stockholders' equity | 3,477,276 | 3,460,136 | |||||||
Parent Company [Member] | |||||||||
Assets | |||||||||
Cash | 7,145 | 13,092 | |||||||
Investment in subsidiaries | 396,897 | 376,453 | |||||||
Other assets | 5,392 | 5,712 | |||||||
TOTAL ASSETS | 409,434 | 395,257 | |||||||
Liabilities | |||||||||
Accrued interest payable | 744 | 551 | |||||||
Other liabilities | 1,333 | 1,251 | |||||||
Long-term debt | 43,072 | 42,762 | |||||||
TOTAL LIABILITIES | 45,149 | 44,564 | |||||||
Stockholders' equity | |||||||||
Common stock | 199 | 198 | |||||||
Additional paid in capital | 201,494 | 200,473 | |||||||
Retained earnings | 171,613 | 149,966 | |||||||
Accumulated other comprehensive income | (9,021) | 56 | |||||||
Total stockholders' equity | 364,285 | 350,693 | |||||||
Total liabilities and stockholders' equity | $ 409,434 | $ 395,257 |
Parent Company Financial Info_4
Parent Company Financial Information (Condensed Statements of Income, Parent Only) (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||
Dec. 31, 2022 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | |
Expenses | ||||||||||
Interest expense | $ 12,543 | $ 6,039 | ||||||||
Legal and professional fees | 2,840 | 1,742 | ||||||||
Income before income taxes | 42,141 | 21,180 | ||||||||
Income tax expense | 10,964 | 5,812 | ||||||||
NET INCOME | $ 8,407 | $ 9,658 | $ 7,499 | $ 5,613 | $ 2,723 | $ 4,616 | $ 4,031 | $ 3,998 | 31,177 | 15,368 |
Parent Company [Member] | ||||||||||
Dividends from subsidiaries | 5,500 | 25,000 | ||||||||
Gain on company owned life insurance | 67 | 110 | ||||||||
Total income | 5,567 | 25,110 | ||||||||
Expenses | ||||||||||
Interest expense | 2,451 | 1,560 | ||||||||
Salaries and employee benefits | 324 | 423 | ||||||||
Legal and professional fees | 1,654 | 2,465 | ||||||||
Other operating expenses | 540 | 384 | ||||||||
Total expenses | 4,969 | 4,832 | ||||||||
undistributed net income of subsidiaries | 598 | 20,278 | ||||||||
Income tax expense | (1,059) | (990) | ||||||||
Income before income tax (benefit) and equity (deficit) in undistributed net income of subsidiaries | 1,657 | 21,268 | ||||||||
(Deficit) equity in undistributed net income of subsidiaries | 29,520 | (5,900) | ||||||||
NET INCOME | $ 31,177 | $ 15,368 |
Parent Company Financial Info_5
Parent Company Financial Information (Condensed Statements of Cash Flows, Parent Only) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Cash flows from operating activities: | ||
Net Income | $ 31,177 | $ 15,368 |
Adjustments to reconcile net income to cash provided by operating activities: | ||
Amortization of debt issuance costs | 122 | 123 |
Stock-based compensation expense | 636 | 378 |
Company owned life insurance income | 1,118 | 1,090 |
Net (increase) in other assets | (1,450) | (3,045) |
Net (decrease) increase in other liabilities | (5,838) | 1,930 |
Net cash (used in) provided by operating activities | 52,647 | (7,503) |
Cash flows from investing activities: | ||
Purchase of company owned life insurance | (10,165) | (10,203) |
Net cash (used in) provided by investing activities | (581,572) | 38,193 |
Cash flows from financing activities: | ||
Net cash provided by financing activities | 811 | 366,006 |
Net (decrease) increase in cash and cash equivalents | (528,114) | 396,696 |
Cash and cash equivalents at beginning of period | 583,613 | 186,917 |
Cash and cash equivalents at end of period | 55,499 | 583,613 |
Parent Company [Member] | ||
Cash flows from operating activities: | ||
Net Income | 31,177 | 15,368 |
Adjustments to reconcile net income to cash provided by operating activities: | ||
Deficit (equity) in undistributed net income of subsidiaries | (29,521) | 5,900 |
Amortization of debt issuance costs | 122 | 123 |
Stock-based compensation expense | 636 | 378 |
Company owned life insurance income | (67) | (110) |
Acquisition accounting adjustments | 188 | 31 |
Net (increase) in other assets | 387 | (1,552) |
Net (decrease) increase in other liabilities | 275 | (142) |
Net cash (used in) provided by operating activities | 3,197 | 19,996 |
Cash flows from investing activities: | ||
Purchase of company owned life insurance | (192) | |
Acquisition of business activity, net of cash paid | (15,945) | |
Net cash (used in) provided by investing activities | (16,137) | |
Cash flows from financing activities: | ||
Common stock dividends paid | (9,530) | (6,607) |
Retirement of common stock | (819) | |
Proceeds from the issuance of common stock | 386 | |
Exercise of stock options | 6 | |
Net cash provided by financing activities | (9,144) | (7,420) |
Net (decrease) increase in cash and cash equivalents | (5,947) | (3,561) |
Cash and cash equivalents at beginning of period | 13,092 | 16,653 |
Cash and cash equivalents at end of period | $ 7,145 | $ 13,092 |
Revenue Recognition (Noninteres
Revenue Recognition (Noninterest Income) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Revenue Recognition [Abstract] | ||
Service charges on deposit accounts | $ 5,652 | $ 3,396 |
Trust and investment fee income | 1,784 | 1,881 |
Interchange income | 4,812 | 3,964 |
Title Company revenue | 1,340 | 247 |
Other noninterest income | 1,752 | 1,519 |
Noninterest Income (in-scope of Topic 606) | 15,340 | 11,007 |
Noninterest Income (out-of-scope of Topic 606) | 7,746 | 2,491 |
Total noninterest income | $ 23,086 | $ 13,498 |