Cover
Cover - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Mar. 03, 2023 | Jun. 30, 2022 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2022 | ||
Document Transition Report | false | ||
Entity File Number | 0-18415 | ||
Entity Registrant Name | Isabella Bank Corp | ||
Entity Incorporation, State or Country Code | MI | ||
Entity Tax Identification Number | 38-2830092 | ||
Entity Address, Address Line One | 401 North Main Street | ||
Entity Address, City or Town | Mount Pleasant | ||
Entity Address, State or Province | MI | ||
Entity Address, Postal Zip Code | 48858 | ||
City Area Code | (989) | ||
Local Phone Number | 772-9471 | ||
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 | true | ||
Entity Shell Company | false | ||
Entity Public Float | $ 168,708 | ||
Entity Common Stock, Shares Outstanding | 7,561,414 | ||
Current Fiscal Year End Date | --12-31 |
Document and Entity Information
Document and Entity Information | 12 Months Ended |
Dec. 31, 2022 | |
Document and Entity Information [Abstract] | |
Entity Central Index Key | 0000842517 |
Amendment Flag | false |
Document Fiscal Year Focus | 2022 |
Document Fiscal Period Focus | FY |
Current Fiscal Year End Date | --12-31 |
Auditor Name | Rehmann Robson LLC |
Auditor Location | Saginaw, Michigan |
Auditor Firm ID | 263 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Interest Receivable and Other Assets | $ 33,586 | $ 19,982 |
Cash and cash equivalents | ||
Cash and demand deposits due from banks | 27,420 | 25,563 |
Interest bearing balances due from banks | 11,504 | 79,767 |
Total cash and cash equivalents | 38,924 | 105,330 |
Debt Securities, Available-for-sale | 580,481 | 490,601 |
Loans Receivable Held-for-sale, Amount | 379 | 1,735 |
Loans | ||
Commercial | 740,920 | 807,439 |
Agricultural | 104,314 | 93,955 |
Loans and Leases Receivable, Gross, Consumer Real Estate | 340,885 | 326,361 |
Loan and Leases Receivable, Gross, Consumer Other | 78,054 | 73,282 |
Gross loans | 1,264,173 | 1,301,037 |
Less allowance for loan losses | 9,850 | 9,103 |
Net loans | 1,254,323 | 1,291,934 |
Premises and equipment | 25,553 | 24,419 |
Corporate owned life insurance | 32,988 | 32,472 |
Equity securities without readily determinable fair values | 15,746 | 17,383 |
Goodwill and other intangible assets | 48,287 | 48,302 |
Assets, Total | 2,030,267 | 2,032,158 |
Deposits | ||
Noninterest bearing | 494,346 | 448,352 |
NOW accounts | 372,155 | 364,563 |
Certificates of deposit under $100 and other savings | 810,642 | 818,841 |
Time Deposits, at or Above FDIC Insurance Limit | 67,132 | 78,583 |
Total deposits | 1,744,275 | 1,710,339 |
Federal Funds Purchased and Securities Sold under Agreements to Repurchase | 57,771 | 50,162 |
Long-term Federal Home Loan Bank Advances | 0 | 20,000 |
Subordinated Debt | 29,245 | 29,158 |
Debt, Long-term and Short-term, Combined Amount | 87,016 | 99,320 |
Accrued interest payable and other liabilities | 12,766 | 11,451 |
Total liabilities | 1,844,057 | 1,821,110 |
Shareholders' equity | ||
Common stock — no par value 15,000,000 shares authorized | 128,651 | 129,052 |
Shares to be issued for deferred compensation obligations | 5,005 | 4,545 |
Retained earnings | 89,748 | 75,592 |
Accumulated other comprehensive income loss | (37,194) | 1,859 |
Total shareholders' equity | 186,210 | 211,048 |
Liabilities and Equity, Total | $ 2,030,267 | $ 2,032,158 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - shares | Dec. 31, 2022 | Dec. 31, 2021 |
Statement of Financial Position [Abstract] | ||
Common stock, shares authorized | 15,000,000 | |
Common stock, shares issued | 7,559,421 | 7,532,641 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Shareholders' Equity - USD ($) $ in Thousands | Total | Common Stock | Shares to be Issued for Deferred Compensation Obligations | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Additional Paid-in Capital |
Beginning balances at Dec. 31, 2019 | $ 210,182 | $ 141,069 | $ 5,043 | $ 62,099 | $ 1,971 | |
Beginning balances, shares at Dec. 31, 2019 | 7,910,804 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Comprehensive income (loss) | 16,612 | 10,885 | 5,727 | |||
Issuance of common stock | 4,185 | $ 4,185 | ||||
Issuance of common stock, shares | 231,393 | |||||
Common stock transferred from the Rabbi Trust to satisfy deferred compensation obligations | 0 | $ 1,273 | (1,273) | |||
Share based payment awards under equity compensation plan | 413 | 413 | ||||
APIC, Share-based Payment Arrangement, Other, Increase for Cost Recognition | 14 | $ 14 | ||||
Common stock purchased for deferred compensation obligations | (1,592) | (1,592) | ||||
Common stock repurchased pursuant to publicly announced repurchase plan | (2,702) | $ (2,702) | ||||
Common stock repurchased pursuant to publicly announced repurchase plan, shares | (144,950) | |||||
Cash dividends | (8,524) | (8,524) | ||||
Ending balances at Dec. 31, 2020 | 218,588 | $ 142,247 | 4,183 | 64,460 | 7,698 | |
Ending balances, shares at Dec. 31, 2020 | 7,997,247 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Comprehensive income (loss) | 13,660 | 19,499 | (5,839) | |||
Issuance of common stock | 1,593 | $ 1,593 | ||||
Issuance of common stock, shares | 67,436 | |||||
Common stock transferred from the Rabbi Trust to satisfy deferred compensation obligations | 0 | $ 71 | (71) | |||
Share based payment awards under equity compensation plan | 433 | 433 | ||||
APIC, Share-based Payment Arrangement, Other, Increase for Cost Recognition | 86 | 86 | ||||
Common stock purchased for deferred compensation obligations | (1,187) | (1,187) | ||||
Common stock repurchased pursuant to publicly announced repurchase plan | (13,758) | $ (13,758) | ||||
Common stock repurchased pursuant to publicly announced repurchase plan, shares | (532,042) | |||||
Cash dividends | (8,367) | (8,367) | ||||
Ending balances at Dec. 31, 2021 | 211,048 | $ 129,052 | 4,545 | 75,592 | 1,859 | |
Ending balances, shares at Dec. 31, 2021 | 7,532,641 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Comprehensive income (loss) | (16,815) | 22,238 | (39,053) | |||
Issuance of common stock | 1,762 | $ 1,762 | ||||
Issuance of common stock, shares | 74,445 | |||||
Common stock transferred from the Rabbi Trust to satisfy deferred compensation obligations | 0 | $ 3 | (3) | |||
Share based payment awards under equity compensation plan | 463 | 463 | ||||
APIC, Share-based Payment Arrangement, Other, Increase for Cost Recognition | 147 | $ 147 | ||||
Common stock purchased for deferred compensation obligations | (1,189) | (1,189) | ||||
Common stock repurchased pursuant to publicly announced repurchase plan | (1,124) | $ (1,124) | ||||
Common stock repurchased pursuant to publicly announced repurchase plan, shares | (47,665) | |||||
Cash dividends | (8,082) | (8,082) | ||||
Ending balances at Dec. 31, 2022 | $ 186,210 | $ 128,651 | $ 5,005 | $ 89,748 | $ (37,194) | |
Ending balances, shares at Dec. 31, 2022 | 7,559,421 |
Consolidated Statements of Ch_2
Consolidated Statements of Changes in Shareholders' Equity (Parenthetical) - $ / shares | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Statement of Stockholders' Equity [Abstract] | |||
Cash dividends per share (in dollars per share) | $ 1.09 | $ 1.08 | $ 1.08 |
Consolidated Statements of Inco
Consolidated Statements of Income - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Interest income | |||
Loans, including fees | $ 53,283 | $ 51,410 | $ 54,102 |
AFS securities | |||
Taxable | 8,363 | 4,920 | 5,214 |
Nontaxable | 2,808 | 3,077 | 3,830 |
Federal funds sold and other | 1,344 | 706 | 1,026 |
Total interest income | 65,798 | 60,113 | 64,172 |
Interest expense | |||
Deposits | 4,021 | 5,442 | 8,884 |
Interest Expense, Federal Funds Purchased and Securities Sold under Agreements to Repurchase | 79 | 53 | 36 |
Interest Expense, Federal Home Loan Bank and Federal Reserve Bank Advances, Long-term | 152 | 1,302 | 4,905 |
Interest Expense, Subordinated Notes and Debentures | 1,065 | 615 | 0 |
Total interest expense | 5,317 | 7,412 | 13,825 |
Net interest income | 60,481 | 52,701 | 50,347 |
Provision for loan losses | 483 | (518) | 1,665 |
Net interest income after provision for loan losses | 59,998 | 53,219 | 48,682 |
Noninterest income | |||
Service charges and fees | 8,730 | 7,614 | 6,544 |
Net gain on sale of mortgage loans | 631 | 1,694 | 2,716 |
Noninterest Income Investment and Trust Advisory Fees | 3,005 | 3,071 | 2,578 |
Earnings on corporate owned life insurance policies | 884 | 800 | 755 |
Bank Owned Life Insurance Income, From Policy Redemption | 57 | 271 | 891 |
Noncontrolling Interest in Net Income (Loss) Joint Venture Partners | 0 | 0 | 577 |
Other | 359 | 372 | 362 |
Total noninterest income | 13,666 | 13,822 | 14,423 |
Noninterest expenses | |||
Compensation and benefits | 24,887 | 23,749 | 23,772 |
Loss on extinguishment of debt | 0 | 0 | 7,643 |
Furniture and equipment | 6,006 | 5,462 | 5,787 |
Occupancy | 3,691 | 3,661 | 3,557 |
Other | 12,236 | 10,822 | 10,474 |
Total noninterest expenses | 46,820 | 43,694 | 51,233 |
Income before federal income tax expense | 26,844 | 23,347 | 11,872 |
Federal income tax expense | 4,606 | 3,848 | 987 |
NET INCOME | $ 22,238 | $ 19,499 | $ 10,885 |
Earnings per share | |||
Basic (in dollars per share) | $ 2.95 | $ 2.48 | $ 1.37 |
Diluted (in dollars per share) | 2.91 | 2.45 | 1.34 |
Cash dividends per basic share (in dollars per share) | $ 1.09 | $ 1.08 | $ 1.08 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | ||
Statement of Comprehensive Income [Abstract] | ||||
Net Income (Loss) Attributable to Parent | $ 22,238 | $ 19,499 | $ 10,885 | |
Unrealized gains (losses) on AFS securities | ||||
Unrealized gains (losses) arising during the period | (50,015) | (8,371) | 7,474 | |
Reclassification adjustment for net realized (gains) losses included in net income | 0 | 0 | (71) | |
Comprehensive income (loss) before income tax (expense) benefit | (50,015) | (8,371) | 7,403 | |
Tax effect | [1] | 10,314 | 1,759 | (1,530) |
Unrealized gains (losses), net of tax | (39,701) | (6,612) | 5,873 | |
Unrealized Gain (Loss) on Derivatives and Commodity Contracts [Abstract] | ||||
Other Comprehensive Income (Loss), Cash Flow Hedge, Gain (Loss), before Reclassification, after Tax | 0 | 53 | (121) | |
Other Comprehensive Income (Loss), Cash Flow Hedge, Gain (Loss), after Reclassification, Tax | [1] | 0 | 11 | (25) |
Other Comprehensive Income (Loss), Cash Flow Hedge, Gain (Loss), after Reclassification and Tax | 0 | 42 | (96) | |
Change in unrecognized pension cost on defined benefit pension plan | ||||
Change in unrecognized pension cost arising during the year | 762 | 955 | (238) | |
Reclassification adjustment for net periodic benefit cost included in net income | 59 | (31) | 176 | |
Net change in unrecognized actuarial loss and prior service cost | 821 | 924 | (62) | |
Tax effect | [1] | (173) | (193) | 12 |
Change in unrealized pension cost, net of tax | 648 | 731 | (50) | |
Other comprehensive income (loss), net of tax | (39,053) | (5,839) | 5,727 | |
Comprehensive income (loss) | $ (16,815) | $ 13,660 | $ 16,612 | |
[1]See “Note 16 – Accumulated Other Comprehensive Income (Loss)” in the accompanying notes to consolidated financial statements for tax effect reconciliation. |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
OPERATING ACTIVITIES | |||
Net Income (Loss) Attributable to Parent | $ 22,238 | $ 19,499 | $ 10,885 |
Reconciliation of net income to net cash provided by operating activities: | |||
Undistributed Earnings Of Equity Method And Other Investments | 0 | 0 | (394) |
Provision for loan losses | 483 | (518) | 1,665 |
Depreciation | 2,071 | 2,314 | 2,620 |
Amortization of OMSR | 97 | 597 | 504 |
Amortization of acquisition intangibles | 15 | 29 | 48 |
Amortization of Debt Issuance Costs | 87 | 52 | 0 |
Net amortization of AFS securities | 2,018 | 2,233 | 2,044 |
Debt Securities, Available-for-sale, Realized Gain (Loss) | 0 | 0 | (71) |
Net gain on sale of mortgage loans | (631) | (1,694) | (2,716) |
OMSR Impairment | (532) | 0 | 316 |
Impairments | (13) | (39) | 51 |
Increase in cash value of corporate owned life insurance policies | (818) | (751) | (708) |
Bank Owned Life Insurance Income, From Policy Redemption | (57) | (271) | (891) |
Loss on sale of joint venture investment | 0 | 0 | 394 |
Loss on extinguishment of debt | 0 | 0 | 7,643 |
Deferred income tax expense (benefit) | 13 | (523) | (276) |
Origination of loans held for sale | (21,382) | (48,957) | (114,323) |
Proceeds from loan sales | 23,369 | 51,657 | 115,202 |
Net changes in operating assets and liabilities which provided (used) cash: | |||
Other assets | (2,813) | 1,208 | (821) |
Accrued interest payable and other liabilities | 2,182 | 146 | 398 |
Net cash provided by (used in) operating activities | 26,937 | 25,501 | 21,997 |
Activity in AFS securities | |||
Sales | 0 | 0 | 26,855 |
Maturities, calls, and principal payments | 68,956 | 100,289 | 97,844 |
Purchases | (210,869) | (262,266) | (28,658) |
Payments to Acquire Equity Method Investments | (250) | 0 | 0 |
Proceeds from Divestiture of Interest in Joint Venture | 0 | 0 | 1,000 |
Loan principal (originations) collections, net | 36,672 | (63,210) | (52,132) |
Proceeds from sales of foreclosed assets | 241 | 716 | 409 |
Purchases of premises and equipment | (3,205) | (1,593) | (1,518) |
Payment to Acquire Life Insurance Policy, Investing Activities | 0 | (4,272) | (625) |
Proceeds from the redemption of corporate owned life insurance policies | 359 | 1,114 | 2,387 |
Proceeds from Sale of Federal Home Loan Bank Stock | 2,288 | 0 | 0 |
Payments to Acquire Federal Reserve Bank Stock | (401) | 0 | 0 |
Payments to Acquire Other Investments | (46) | (413) | (429) |
Net cash provided by (used in) investing activities | (106,255) | (229,635) | 45,133 |
FINANCING ACTIVITIES | |||
Net increase (decrease) in deposits | 33,936 | 144,022 | 252,466 |
Increase (Decrease) in Federal Funds Purchased and Securities Sold under Agreements to Repurchase, Net | 7,609 | (18,585) | 37,748 |
Increase (Decrease) in Loans from Federal Home Loan Banks | (20,000) | (70,000) | (162,643) |
Proceeds from Issuance of Subordinated Long-term Debt | 0 | 29,106 | 0 |
Cash dividends paid on common stock | (8,082) | (8,367) | (8,524) |
Proceeds from issuance of common stock | 1,762 | 1,593 | 4,185 |
Common stock repurchased | (1,124) | (13,758) | (2,702) |
Common stock purchased for deferred compensation obligations | (1,189) | (1,187) | (1,592) |
Net cash provided by (used in) financing activities | 12,912 | 62,824 | 118,938 |
Increase (decrease) in cash and cash equivalents | (66,406) | (141,310) | 186,068 |
Cash and cash equivalents at beginning of period | 105,330 | 246,640 | 60,572 |
Cash and cash equivalents at end of period | 38,924 | 105,330 | 246,640 |
SUPPLEMENTAL CASH FLOWS INFORMATION: | |||
Interest paid | 5,313 | 7,601 | 14,204 |
Federal income taxes paid | 4,425 | 4,050 | 846 |
SUPPLEMENTAL NONCASH INFORMATION: | |||
Transfers of loans to foreclosed assets | 456 | 361 | 531 |
Loan Receivable, Sale of Joint Venture Investment [Line Items] | 0 | 0 | 3,227 |
Isabella Bank Corporation and Related Companies Deferred Compensation Plan for Directors | |||
Reconciliation of net income to net cash provided by operating activities: | |||
Share-based payment awards under equity compensation plan | 463 | 433 | 413 |
Share-based payment awards | 463 | 433 | 413 |
Isabella Bank Corporation Restricted Stock Plan | |||
Reconciliation of net income to net cash provided by operating activities: | |||
Share-based payment awards under equity compensation plan | 147 | 86 | 14 |
Share-based payment awards | $ 147 | $ 86 | $ 14 |
Pending Accounting Standards Up
Pending Accounting Standards Updates | 12 Months Ended |
Dec. 31, 2022 | |
Accounting Standards Update and Change in Accounting Principle [Abstract] | |
Pending Accounting Standards Updates | Accounting Standards Updates Pending Accounting Standards Updates ASU No. 2016-13: “Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments” In June 2016, ASU No. 2016-13 was issued and updated the measurement for credit losses for AFS debt securities and assets measured at amortized cost which include loans, trade receivables, and any other financial assets with the contractual right to receive cash. Current GAAP requires an “incurred loss” methodology for recognizing credit losses that delays recognition until it is probable a loss has been incurred. Under the incurred loss approach, entities are limited to a probable initial recognition threshold when credit losses are measured; an entity generally only considers past events and current conditions in measuring the incurred loss. Under the new guidance, the incurred loss impairment methodology is replaced with a methodology that reflects current expected credit losses (CECL). This methodology requires consideration of a broader range of reasonable and supportable information to calculate credit loss estimates. The measurement of expected credit losses is based on relevant information about past events, including historical experience, current conditions, and reasonable and supportable forecasts that affect the collectability of the reported amount. An entity must use judgment in determining the relevant information and estimation methods that are appropriate in its circumstances which applies to assets measured either collectively or individually. The update allows an entity to revert to historical loss information that is reflective of the contractual term (considering the effect of prepayments) for periods that are beyond the time frame for which the entity is able to develop reasonable and supportable forecasts. In addition, the disclosures of credit quality indicators in relation to the amortized cost of financing receivables, a current disclosure requirement, are further disaggregated by year of origination (or vintage). The vintage information will be useful for financial statement users to better assess changes in underwriting standards and credit quality trends in asset portfolios over time and the effect of those changes on credit losses. Overall, the update will allow entities the ability to measure expected credit losses without the restriction of incurred or probable losses that exist under current GAAP. For users of the financial statements, the update requires disclosure of decision-useful information about the expected credit losses on financial instruments and other commitments to extend credit held by a reporting entity at each reporting date. The new authoritative guidance was originally effective for interim and annual periods beginning after December 15, 2019. Effective October 16, 2019, the FASB approved and issued changes to the implementation date of this guidance for some filers. As a smaller reporting company, as defined by the SEC, our implementation date was delayed from January 1, 2020 to January 1, 2023. Early adoption continues to be permissible under the revised implementation date. This guidance may have a significant impact on the results of our operations and financial statement disclosures as well as that of the banking industry as a whole. We invested a considerable amount of effort toward this guidance to be prepared for adoption on January 1, 2023. An internal committee was formed and was accountable for timely and accurate adoption of the guidance. A service provider that has focused on the ALLL for more than 10 years and serves hundreds of financial institutions was engaged to provide us with education, advisory, and software solutions exclusively related to the ACL. We ran parallel processes for over a year to ensure our calculation and analysis was complete by the required implementation date. We fully adopted the new guidance as of January1, 2023. Based on portfolio characteristics and economic conditions and expectations as of January 1, 2023, we recorded a combined increase to the ACL and reserve for unfunded commitments on January 1, 2023 of approximately $3,000 upon the adoption of ASU 2016-13. |
Nature of Operations and Summar
Nature of Operations and Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2022 | |
Accounting Policies [Abstract] | |
Nature of Operations and Summary of Significant Accounting Policies | Nature of Operations and Summary of Significant Accounting Policies BASIS OF PRESENTATION AND CONSOLIDATION: The consolidated financial statements include the accounts of Isabella Bank Corporation, a financial services holding company, and its wholly owned subsidiary, Isabella Bank. All intercompany balances and accounts have been eliminated in consolidation. References to “the Corporation”, “Isabella”, “we”, “our”, “us”, and similar terms refer to the consolidated entity consisting of Isabella Bank Corporation and its subsidiary. References to Isabella Bank or the “Bank” refers to Isabella Bank Corporation’s subsidiary, Isabella Bank. For additional information, see “Note 18 – Related Party Transactions.” NATURE OF OPERATIONS: Isabella Bank Corporation is a financial services holding company offering a wide array of financial products and services in several mid-Michigan counties. Our banking subsidiary, Isabella Bank, offers banking services throughout 29 locations, 24 hour banking services locally and nationally through shared automatic teller machines, 24 hour online banking, mobile banking, and direct deposits to businesses, institutions, individuals and their families. Lending services offered include commercial loans, agricultural loans, residential real estate loans, and consumer loans. Deposit services include interest and noninterest bearing checking accounts, savings accounts, money market accounts, certificates of deposit, direct deposits, cash management services, mobile and internet banking, electronic bill pay services, and automated teller machines. Other related financial products include trust and investment services, safe deposit box rentals, and various insurance related products. Active competition, principally from other commercial banks, savings and loan associations, mortgage brokers, finance companies, credit unions, retail brokerage firms, and insurance companies, exists in all of our principal markets. Our results of operations can be significantly affected by changes in interest rates, changes in the local economic environment and changes in regulations. USE OF ESTIMATES: In preparing consolidated financial statements in conformity with accounting principles generally accepted in the United States of America, we make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the consolidated balance sheet and reported amounts of revenues and expenses during the reporting year. Actual results could differ from those estimates. Material estimates that are particularly susceptible to significant change in the near term relate to the determination of the ALLL, the fair value of AFS investment securities, and the valuation of goodwill and other intangible assets. FAIR VALUE MEASUREMENTS : Fair value refers to the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants in the market in which the reporting entity transacts such sales or transfers based on the assumptions market participants would use when pricing an asset or liability. Assumptions are developed based on prioritizing information within a fair value hierarchy that gives the highest priority to quoted prices in active markets and the lowest priority to unobservable data, such as the reporting entity’s own data. We may choose to measure eligible items at fair value at specified election dates. For assets and liabilities recorded at fair value, it is our policy to maximize the use of observable inputs and minimize the use of unobservable inputs when developing fair value measurements for those financial instruments for which there is an active market. In cases where the market for a financial asset or liability is not active, we include appropriate risk adjustments that market participants would make for nonperformance and liquidity risks when developing fair value measurements. Fair value measurements for assets and liabilities for which limited or no observable market data exists are accordingly based primarily upon estimates, are often calculated based on the economic and competitive environment, the characteristics of the asset or liability and other factors. Therefore, the results cannot be determined with precision and may not be realized in an actual sale or immediate settlement of the asset or liability. Additionally, there may be inherent weaknesses in any calculation technique, and changes in the underlying assumptions used, including discount rates and estimates of future cash flows, could significantly affect the results of current or future values. We utilize fair value measurements to record fair value adjustments to certain assets and liabilities and to determine fair value disclosures. Investment securities AFS and derivative instruments are recorded at fair value on a recurring basis. Additionally, from time to time, we may be required to record other assets and liabilities at fair value on a nonrecurring basis, such as mortgage loans AFS, impaired loans, foreclosed assets, OMSR, goodwill, and certain other assets and liabilities. These nonrecurring fair value adjustments typically involve the application of lower of cost or market accounting or write downs of individual assets. Fair Value Hierarchy Under fair value measurement and disclosure authoritative guidance, we group assets and liabilities measured at fair value into three levels, based on the markets in which the assets and liabilities are traded, and the reliability of the assumptions used to determine fair value, based on the prioritization of inputs in the valuation techniques. These levels are: Level 1: Valuation is based upon quoted prices for identical instruments traded in active markets. Level 2: Valuation is based upon quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active and model based valuation techniques for which all significant assumptions are observable in the market. Level 3: Valuation is generated from model based techniques that use at least one significant assumption not observable in the market. These unobservable assumptions reflect estimates of assumptions that market participants would use in pricing the asset or liability. The asset’s or liability’s fair value measurement level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. Valuation techniques maximize the use of observable inputs and minimize the use of unobservable inputs. Transfers between measurement levels are recognized at the end of reporting periods. For further discussion of fair value considerations, refer to “Note 17 – Fair Value.” SIGNIFICANT GROUP CONCENTRATIONS OF CREDIT RISK : Most of our activities are conducted with customers located within the central Michigan area. A significant amount of our outstanding loans are secured by commercial and residential real estate. Other than these types of loans, there is no significant concentration to any other industry or any one customer. CASH AND CASH EQUIVALENTS: For purposes of the consolidated statements of cash flows, cash and cash equivalents include cash and balances due from banks, federal funds sold, and other deposit accounts. Generally, federal funds sold are for a one day period. We maintain deposit accounts in various financial institutions which generally exceed federally insured limits or are not insured. We do not believe we are exposed to any significant interest, credit or other financial risk as a result of these deposits. AFS SECURITIES: Purchases of investment securities are generally classified as AFS. However, we may elect to classify securities as either held to maturity or trading. Securities classified as AFS debt securities are recorded at fair value, with unrealized gains and losses, net of the effect of deferred income taxes, excluded from earnings and reported in other comprehensive income. Included in AFS securities are auction rate money market preferred securities. These investments, for federal income tax purposes, have no federal income tax impact given the nature of the investments. Auction rate money market preferred securities are recorded at fair value, with unrealized gains and losses excluded from earnings and reported in other comprehensive income. Purchase premiums and discounts are recognized in interest income using the interest method over the term of the securities. Realized gains and losses on the sale of AFS securities are determined using the specific identification method. AFS securities are reviewed quarterly for possible OTTI. In determining whether an OTTI exists for debt securities, we assert that: (a) we do not have the intent to sell the security; and (b) it is more likely than not we will not have to sell the security before recovery of its cost basis. If these conditions are not met, we recognize an OTTI charge through earnings for the difference between the debt security’s amortized cost basis and its fair value, and such amount is included in noninterest income. For debt securities that do not meet the above criteria, and we do not expect to recover the security’s amortized cost basis, the security is considered other-than-temporarily impaired. For these debt securities, we separate the total impairment into the credit risk loss component and the amount of the loss related to market and other risk factors. In order to determine the amount of the credit loss for a debt security, we calculate the recovery value by performing a discounted cash flow analysis based on the current cash flows and future cash flows we expect to recover. The amount of the total OTTI related to the credit risk is recognized in earnings and is included in noninterest income. The amount of the total OTTI related to other risk factors is recognized as a component of other comprehensive income. For debt securities that have recognized OTTI through earnings, if through subsequent evaluation there is a significant increase in the cash flow expected, the difference between the amortized cost basis and the cash flows expected to be collected is accreted as interest income. LOANS: Loans that we have the intent and ability to hold for the foreseeable future or until maturity or payoff are reported at their outstanding principal balance adjusted for any charge-offs, the ALLL, and any deferred fees or costs. Interest income on loans is accrued over the term of the loan based on the principal amount outstanding. Loan origination fees and certain direct loan origination costs are capitalized and recognized as a component of interest income over the term of the loan using the appropriate yield methods. The accrual of interest on agricultural, commercial and mortgage loans is discontinued at the time the loan is 90 days or more past due unless the credit is well secured and in the process of collection. Consumer loans are typically charged-off no later than 180 days past due. Past due status is based on contractual terms of the loan. In all cases, loans are placed in nonaccrual or charged-off at an earlier date if collection of principal or interest is considered doubtful. For loans that are placed on nonaccrual status or charged-off, all interest accrued in the current calendar year, but not collected, is reversed against interest income while interest accrued in prior calendar years, but not collected is charged against the ALLL. Interest income on loans in nonaccrual status is not recognized until qualifying for return to accrual status. Loans are returned to accrual status when all principal and interest amounts contractually due are brought current and future payments are reasonably assured. For impaired loans not classified as nonaccrual, interest income continues to be accrued over the term of the loan based on the principal amount outstanding. ALLOWANCE FOR LOAN AND LEASE LOSSES: The ALLL is established as losses are estimated to have occurred through a provision for loan losses charged to earnings. Loan losses are charged against the allowance when we believe the uncollectability of the loan balance is confirmed. Subsequent recoveries, if any, are credited to the allowance. We evaluate the ALLL on a regular basis. Our periodic review of the collectability of loans considers historical experience, the nature and volume of the loan portfolio, adverse situations that may affect the borrower’s ability to repay, estimated value of any underlying collateral and prevailing economic conditions. This evaluation is inherently subjective as it requires estimates that are susceptible to significant revision as more information becomes available. The ALLL consists of specific, general, and unallocated components. The specific component relates to loans that are deemed to be impaired. For such loans that are analyzed for specific allowance allocations, an allowance is established when the discounted cash flows or collateral value, less costs to sell, of the impaired loan is lower than the carrying value of that loan. The general component covers non-impaired loans and is based on historical loss experience adjusted for current conditions. An unallocated component is maintained to cover uncertainties that we believe affect our estimate of probable losses based on qualitative factors. The unallocated component of the allowance reflects the margin of imprecision inherent in the underlying assumptions used in the methodologies for estimating specific and general losses in the portfolio. Loans may be classified as impaired if they meet one or more of the following criteria: 1. There has been a charge-off of its principal balance; 2. The loan has been classified as a TDR; or 3. The loan is in nonaccrual status. Impairment is measured on a loan-by-loan basis by either the present value of expected future cash flows discounted at the loan’s effective interest rate, or the fair value of the collateral, less costs to sell, if the loan is collateral dependent. Large groups of smaller-balance, homogeneous loans are collectively evaluated for impairment. LOANS HELD FOR SALE: Mortgage loans held for sale on the secondary market are carried at the lower of cost or fair value as determined by aggregating outstanding commitments from investors or current investor yield requirements. Net unrealized losses, if any, would be recognized as a component of other noninterest expenses. Mortgage loans held for sale are sold with the mortgage servicing rights retained by us. Gains or losses on sales of mortgage loans are recognized based on the difference between the selling price and the carrying value of the related mortgage loans sold. TRANSFERS OF FINANCIAL ASSETS: Transfers of financial assets, including mortgage loans and participation loans, are accounted for as sales when control over the assets has been surrendered. Control over transferred assets is determined to be surrendered when 1) the assets have been legally isolated from us, 2) the transferee obtains the right (free of conditions that constrain it from taking advantage of the right) to pledge or exchange the transferred assets, and 3) we do not maintain effective control over the transferred assets through an agreement to repurchase them before their maturity. Other than servicing, we have no substantive continuing involvement related to these loans. SERVICING: Servicing assets are recognized as separate assets when rights are acquired through purchase or through sale of financial assets. We have no purchased servicing rights. For sales of mortgage loans, a portion of the cost of originating the loan is allocated to the servicing right based on relative fair value. Fair value is based on market prices for comparable mortgage servicing contracts, when available, or alternatively, is based on a valuation model that calculates the present value of estimated future net servicing income. The valuation model incorporates assumptions that market participants would use in estimating future net servicing income, such as the cost to service, the discount rate, the custodial earnings rate, an inflation rate, ancillary income, prepayment speeds and default rates and losses. Servicing assets are evaluated for impairment based upon the fair value of the rights as compared to amortized cost. Impairment is determined by stratifying rights into tranches based on predominant risk characteristics, such as interest rate, loan type, and investor type. Impairment is recognized through a valuation allowance for an individual tranche, to the extent that fair value is less than the capitalized amount for the tranche. If we later determine that all or a portion of the impairment no longer exists for a particular tranche, a reduction of the valuation allowance may be recorded as an increase to income. Capitalized servicing rights are reported in other assets and are amortized into noninterest income in proportion to, and over the period of, the estimated future net servicing income of the underlying financial assets. The unpaid principal balance of mortgages serviced for others was $264,206 and $278,844 with capitalized servicing rights of $2,559 and $2,124 at December 31, 2022 and 2021, respectively, which are included in other assets. Servicing fee income is recorded for fees earned for servicing loans for others. The fees are based on a contractual percentage of the outstanding principal or a fixed amount per loan and are recorded as income when earned. We recorded servicing fee revenue of $669, $747, and $625 related to residential mortgage loans serviced for others during 2022, 2021, and 2020, respectively, which is included in other noninterest income. FORECLOSED ASSETS: Assets acquired through, or in lieu of, loan foreclosure are held for sale and are initially recorded at the lower of our carrying amount or fair value less estimated selling costs at the date of transfer, establishing a new cost basis. Any write downs based on the asset’s fair value at the date of acquisition are charged to the ALLL. After foreclosure, property held for sale is carried at the lower of the new cost basis or fair value less costs to sell. Impairment losses on property to be held and used are measured at the amount by which the carrying amount of property exceeds its fair value. Costs relating to holding these assets are expensed as incurred. We periodically perform valuations and any subsequent write downs are recorded as a charge to operations, if necessary, to reduce the carrying value of a property to the lower of our carrying amount or fair value less costs to sell. Foreclosed assets of $439 and $211 as of December 31, 2022 and 2021, respectively, are included in other assets. PREMISES AND EQUIPMENT: Land is carried at cost. Buildings and equipment are carried at cost, less accumulated depreciation which is computed principally by the straight-line method based upon the estimated useful lives of the related assets, which range from 3 to 40 years. Major improvements are capitalized and appropriately amortized based upon the useful lives of the related assets or the expected terms of the leases, if shorter, using the straight-line method. Maintenance, repairs and minor alterations are charged to current operations as expenditures occur. We annually review these assets to determine whether carrying values have been impaired. EQUITY SECURITIES WITHOUT READILY DETERMINABLE FAIR VALUES: Included in equity securities without readily determinable fair values are our holdings in FHLB stock and FRB stock. Equity securities without readily determinable fair values consist of the following holdings as of December 31: 2022 2021 FHLB Stock $ 12,762 $ 15,050 FRB Stock 2,400 1,999 Other 584 334 Total $ 15,746 $ 17,383 EQUITY COMPENSATION PLANS: At December 31, 2022, the Directors Plan had 207,840 shares eligible to be issued to participants, for which the Rabbi Trust held 154,879 shares. We had 189,364 shares to be issued at December 31, 2021, with 105,654 shares held in the Rabbi Trust. Under the RSP, compensation expense for nonvested stock awards is based on the fair value of the award on the measurement date. The fair value of nonvested stock awards is based on the date of the grant and is recognized over the requisite service period. The impact of forfeitures of share-based payment awards on compensation expense is recognized as forfeitures occur. Compensation costs relating to share-based payment transactions are recognized as the services are rendered, with the cost measured based on the fair value of the equity or liability instruments issued (see “Note 12 – Benefit Plans”). CORPORATE OWNED LIFE INSURANCE: We have purchased life insurance policies on key members of management, partially for the purpose of funding certain post-retirement benefits. In the event of death of one of these individuals, we would receive a specified cash payment equal to the face value of the policy. Such policies are recorded at their cash surrender value, or the amount that can be realized on the balance sheet date. Increases in cash surrender value in excess of single premiums paid are reported as other noninterest income. Of the purchased life insurance policies, we hold post retirement benefits with a present value estimated to be $2,905 and $2,843 as of December 31, 2022 and 2021, respectively, which is included in accrued interest payable and other liabilities. The expenses associated with these policies totaled $61, $33, and $87 for 2022, 2021, and 2020, respectively. ACQUISITION INTANGIBLES AND GOODWILL: We previously acquired branch facilities and related deposits in business combinations accounted for as a purchase. The acquisitions included amounts related to the valuation of customer deposit relationships (core deposit intangibles). Core deposit intangibles arising from acquisitions are included in goodwill and other intangible assets are being amortized over their estimated lives and evaluated for potential impairment on at least an annual basis. Goodwill, which represents the excess of the purchase price over identifiable assets, is not amortized but is evaluated for impairment on at least an annual basis. Acquisition intangibles and goodwill are typically qualitatively evaluated to determine if it is more likely than not that the carrying balance is impaired. If it is determined that the carrying balance is more likely than not to be impaired, we perform a cash flow valuation to determine the extent of the potential impairment. This valuation method requires a significant degree of our judgment. In the event the projected undiscounted net operating cash flows for these intangible assets are less than the carrying value, the asset is recorded at fair value as determined by the valuation model. OFF BALANCE SHEET CREDIT RELATED FINANCIAL INSTRUMENTS: In the ordinary course of business, we have entered into commitments to extend credit, including commitments under credit card arrangements, commercial lines of credit, home equity lines of credit, commercial letters of credit, and standby letters of credit. Such financial instruments are recorded only when funded. REVENUE RECOGNITION: Our revenue is comprised primarily of interest income, service charges and fees, gains on the sale of loans and AFS securities, earnings on corporate owned life insurance policies, and other noninterest income. Other noninterest income is typically service and performance driven in nature and comprised primarily of investment and trust advisory fees. We recognize revenue, excluding interest income and other income specifically scoped out, in accordance with ASC 606, Revenue From Contracts with Customers. Revenue is recognized when our performance obligation has been satisfied according to our contractual obligation. FEDERAL INCOME TAXES: Deferred income tax assets and liabilities are determined using the liability (or balance sheet) method. Under this method, the net deferred tax assets or liabilities are determined based on the tax effects of the temporary differences between the book and tax basis on the various balance sheet assets and liabilities and gives current recognition to changes in tax rates and laws. Valuation allowances are established, where necessary, to reduce deferred tax assets to the amount expected to be realized. Income tax expense is the tax payable or refundable for the year plus or minus the change during the year in deferred tax assets and liabilities. We analyze our filing positions in the jurisdictions where we are required to file income tax returns, as well as all open tax years in these jurisdictions. We also treat interest and penalties attributable to income taxes, to the extent they arise, as a component of our noninterest expenses. DEFINED BENEFIT PENSION PLAN: We maintain a noncontributory defined benefit pension plan, which was curtailed effective March 1, 2007. The service cost component of the defined benefit pension plan is included in “compensation and benefits” on the consolidated statements of income and is funded consistent with the requirements of federal laws and regulations. All other costs related to the defined benefit pension plan are included in “other” noninterest expenses on the consolidated statements of income. The current benefit obligation is included in "accrued interest payable and other liabilities" on the consolidated balance sheets. Inherent in the determination of defined benefit pension costs are assumptions concerning future events that will affect the amount and timing of required benefit payments under the plan. These assumptions include demographic assumptions such as mortality, a discount rate used to determine the current benefit obligation and a long-term expected rate of return on plan assets. Net periodic benefit cost includes the interest cost based on the assumed discount rate, an expected return on plan assets based on an actuarially derived market-related value of assets, and amortization of unrecognized net actuarial gains or losses. Actuarial gains and losses result from experience different from that assumed and from changes in assumptions (excluding asset gains and losses not yet reflected in market-related value). Amortization of actuarial gains and losses is included as a component of net periodic defined benefit pension cost. For additional information, see “Note 12 – Benefit Plans.” MARKETING COSTS: Marketing costs are expensed as incurred (see “Note 14 – Other Noninterest Expenses”). RECLASSIFICATIONS: Certain amounts reported in the 2021 and 2020 consolidated financial statements have been reclassified to conform with the 2022 presentation. |
AFS Securities
AFS Securities | 12 Months Ended |
Dec. 31, 2022 | |
Investments, Debt and Equity Securities [Abstract] | |
AFS Securities | AFS Securities The amortized cost and fair value of AFS securities, with gross unrealized gains and losses, are as follows as of December 31: 2022 Amortized Gross Gross Fair U.S. Treasury $ 231,622 $ — $ 22,921 $ 208,701 States and political subdivisions 122,023 392 4,903 117,512 Auction rate money market preferred 3,200 — 858 2,342 Mortgage-backed securities 42,309 — 3,239 39,070 Collateralized mortgage obligations 218,301 — 12,573 205,728 Corporate 8,150 — 1,022 7,128 Total $ 625,605 $ 392 $ 45,516 $ 580,481 2021 Amortized Gross Gross Fair U.S. Treasury $ 212,379 $ — $ 2,676 $ 209,703 States and political subdivisions 116,836 4,457 88 121,205 Auction rate money market preferred 3,200 42 — 3,242 Mortgage-backed securities 54,710 1,438 — 56,148 Collateralized mortgage obligations 90,435 1,876 10 92,301 Corporate 8,150 19 167 8,002 Total $ 485,710 $ 7,832 $ 2,941 $ 490,601 The amortized cost and fair value of AFS securities by contractual maturity at December 31, 2022 are as follows: Maturing Securities with Variable Monthly Payments or Noncontractual Maturities Due in After One After Five After Total U.S. Treasury $ — $ 231,622 $ — $ — $ — $ 231,622 States and political subdivisions 19,753 42,946 21,234 38,090 — 122,023 Auction rate money market preferred — — — — 3,200 3,200 Mortgage-backed securities — — — — 42,309 42,309 Collateralized mortgage obligations — — — — 218,301 218,301 Corporate — — 8,150 — — 8,150 Total amortized cost $ 19,753 $ 274,568 $ 29,384 $ 38,090 $ 263,810 $ 625,605 Fair value $ 19,666 $ 251,479 $ 27,703 $ 34,493 $ 247,140 $ 580,481 Expected maturities for government sponsored enterprises and states and political subdivisions may differ from contractual maturities because issuers may have the right to call or prepay obligations. As the auction rate money market preferred investments have continual call dates, they are not reported by a specific maturity group. Because of their variable monthly payments, mortgage-backed securities and collateralized mortgage obligations are not reported by a specific maturity group. A summary of the sales activity of AFS securities during the years ended December 31 is displayed in the following table. 2022 2021 2020 Proceeds from sales of AFS securities $ — $ — $ 26,855 Realized gains (losses) $ — $ — $ 71 Applicable income tax expense (benefit) $ — $ — $ 15 The information on the following tables pertains to AFS securities with gross unrealized losses at December 31, 2022 and 2021 aggregated by investment category and length of time that individual securities have been in a continuous loss position. December 31, 2022 Less Than Twelve Months Twelve Months or More Gross Fair Gross Fair Total U.S. Treasury $ 1,388 $ 18,331 $ 21,533 $ 190,369 $ 22,921 States and political subdivisions 2,389 48,083 2,514 40,667 4,903 Auction rate money market preferred — — 858 2,342 858 Mortgage-backed securities 3,239 39,069 — — 3,239 Collateralized mortgage obligations 12,408 201,316 165 4,411 12,573 Corporate — — 1,022 7,128 1,022 Total $ 19,424 $ 306,799 $ 26,092 $ 244,917 $ 45,516 Number of securities in an unrealized loss position: 178 266 444 December 31, 2021 Less Than Twelve Months Twelve Months or More Gross Fair Gross Fair Total U.S. Treasury $ 2,676 $ 209,703 $ — $ — $ 2,676 States and political subdivisions 88 9,674 — — 88 Collateralized mortgage obligations 10 11,165 — — 10 Corporate 167 6,283 — — 167 Total $ 2,941 $ 236,825 $ — $ — $ 2,941 Number of securities in an unrealized loss position: 40 — 40 The unrealized loss on our AFS securities portfolio resulted from the recent increases in short-term and intermediate-term interest rates. As of December 31, 2022 and 2021, we conducted an analysis to determine whether any AFS securities currently in an unrealized loss position should be identified as other-than-temporarily impaired. Such analyses considered, among other factors, the following criteria: • Has the value of the investment declined more than what is deemed to be reasonable based on a risk and maturity adjusted discount rate? • Is the investment credit rating below investment grade? • Is it probable the issuer will be unable to pay the amount when due? • Is it more likely than not that we will have to sell the security before recovery of its cost basis? • Has the duration of the investment been extended? Based on our analysis, which included the criteria outlined above and the fact that we have asserted that we do not have to sell any AFS securities in an unrealized loss position, we do not believe that the values of any AFS securities are other-than-temporarily impaired as of December 31, 2022 and 2021, with the exception of one municipal bond previously identified in 2016 which had no activity during the period. |
Loans and ALLL
Loans and ALLL | 12 Months Ended |
Dec. 31, 2022 | |
Receivables [Abstract] | |
Loans and ALLL | Loans and ALLL We grant commercial, agricultural, residential real estate, and consumer loans to customers situated primarily in Clare, Gratiot, Isabella, Mecosta, Midland, Montcalm, and Saginaw counties in Michigan. The ability of the borrowers to honor their repayment obligations is often dependent upon the real estate, agricultural, manufacturing, retail, gaming, tourism, health care, higher education, and general economic conditions of this region. Substantially all of our consumer and residential real estate loans are secured by various items of property, while commercial loans are secured primarily by real estate, business assets, and personal guarantees. A portion of loans are unsecured. Loans that we have the intent and ability to hold in our portfolio are reported at their outstanding principal balance adjusted for any charge-offs, the ALLL, and deferred fees or costs. Unless a loan has a nonaccrual status, interest income is accrued over the term of the loan based on the principal amount outstanding. Loan origination fees and certain direct loan origination costs are capitalized and recognized as a component of interest income over the term of the loan using the appropriate amortization method. The accrual of interest on commercial and agricultural loans, as well as residential real estate loans, is discontinued at the time a loan is 90 days or more past due unless the credit is well-secured and in the process of short-term collection. Upon transferring a loan to nonaccrual status, we perform an evaluation to determine the net realizable value of the underlying collateral. This evaluation is used to help determine if a charge-off is necessary. Consumer loans are typically charged-off no later than 180 days past due. Past due status is based on the contractual term of the loan. In all cases, a loan is placed in nonaccrual status at an earlier date if collection of principal or interest is considered doubtful. When a loan is placed in nonaccrual status, all interest accrued in the current calendar year, but not collected, is reversed against interest income while interest accrued in prior calendar years, but not collected, is charged against the ALLL. Loans may be returned to accrual status after six months of continuous performance and achievement of current payment status. Commercial and agricultural loans include loans for commercial real estate, commercial operating loans, advances to mortgage brokers, farmland and agricultural production, and loans to states and political subdivisions. Repayment of these loans is dependent upon the successful operation and management of a business. We minimize our risk by limiting the amount of direct credit exposure to any one borrower to $18,000. Borrowers with direct credit needs of more than $18,000 may be serviced through the use of loan participations with other commercial banks. Commercial and agricultural real estate loans commonly require loan-to-value limits of 80% or less. Depending upon the type of loan, past credit history, and current operating results, we may require the borrower to pledge accounts receivable, inventory, property, or equipment. Government agency guarantee may be required. Personal guarantees and/or life insurance beneficiary assignments are generally required from the owners of closely held corporations, partnerships, and sole proprietorships. In addition, we may require annual financial statements, prepare cash flow analyses, and review credit reports.. We entered into a mortgage purchase program in 2016 with a financial institution where we participate in advances to mortgage brokers. The mortgage brokers originate residential mortgage loans with the intent to sell them on the secondary market. We participate in the advance to the mortgage broker, which is secured by the underlying mortgage loan, until it is ultimately sold on the secondary market. As such, the average life of each participated advance is approximately 20-30 days. Funds from the sale of the loan are used to pay off our participation in the advance to the mortgage broker. We classify these advances as commercial loans and include the outstanding balance in commercial loans on our consolidated balance sheets. Under the participation agreement, we currently are not committed to participate. We offer adjustable rate mortgages, construction loans, and fixed rate residential real estate loans which have amortization periods up to a maximum of 30 years. We consider the anticipated direction of interest rates, balance sheet duration, the sensitivity of our balance sheet to changes in interest rates, our liquidity needs, and overall loan demand to determine whether or not to sell fixed rate loans to Freddie Mac. Our lending policies generally limit the maximum loan-to-value ratio on residential real estate loans to 100% of the lower of the appraised value of the property or the purchase price. Private mortgage insurance is typically required on loans with loan-to-value ratios in excess of 80% unless the loan qualifies for government guarantees. Underwriting criteria for residential real estate loans generally include: • Evaluation of the borrower’s ability to make monthly payments. • Evaluation of the value of the property securing the loan. • Ensuring the payment of principal, interest, taxes, and hazard insurance does not exceed 28% of a borrower’s gross income. • Ensuring all debt servicing does not exceed 40% of income. • Verification of acceptable credit reports. • Verification of employment, income, and financial information. Appraisals are performed by independent appraisers and are reviewed for appropriateness. Generally, mortgage loan requests are reviewed by our mortgage loan committee or through a secondary market underwriting system; loans in excess of $1,000 require the approval of our Internal Loan Committee, the Executive Loan Committee, the Board of Directors’ Loan Committee, or the Board of Directors. Consumer loans include secured and unsecured personal loans. Loans are amortized for a period of up to 15 years based on the age and value of the underlying collateral. The underwriting emphasis is on a borrower’s perceived intent and ability to pay rather than collateral value. No consumer loans are sold to the secondary market. The ALLL is established as losses are estimated to have occurred through a provision for loan losses charged to earnings. Full or partial loan balances are charged against the ALLL when we believe uncollectability is probable. Subsequent recoveries, if any, are credited to the ALLL The ALLL is evaluated on a regular basis for appropriateness. Our periodic review of the collectability of a loan considers historical experience, the nature and volume of the loan portfolio, adverse situations that may affect the borrower’s ability to repay, estimated value of any underlying collateral, and prevailing economic conditions. This evaluation is inherently subjective as it requires estimates that are susceptible to significant revision as more information becomes available. The primary factors behind the determination of the level of the ALLL are specific allocations for impaired loans, historical loss percentages, as well as unallocated components. Specific allocations for impaired loans are primarily determined based on the difference between the loan’s outstanding balance and the present value of expected future cash flows discounted at the loan’s effective interest rate, or the fair value of the collateral, less costs to sell, if the loan is collateral dependent. Historical loss allocations are calculated at the loan class and segment levels based on a migration analysis of the loan portfolio, with the exception of advances to mortgage brokers, over the preceding five years. With no historical losses on advances to mortgage brokers, there is no allocation related to this portfolio. The unallocated component of the allowance reflects the margin of imprecision inherent in the underlying assumptions used in the methodologies for estimating specific and general losses in the portfolio. While we have experienced fluctuations in credit quality indicators in recent periods, credit quality remained strong at December 31, 2022. The COVID-19 pandemic led to the temporary and some permanent closures of businesses throughout the communities in which we serve, which also led to increased unemployment. We increased the ALLL during 2020 as a result of increased economic and environmental related risk factors, primarily driven by COVID-19. While these risk factors remain, improvement in credit quality indicators resulted in a reduction to the ALLL during 2021. There have been no material changes to the ALLL and credit quality remained strong throughout 2022. A summary of changes in the ALLL and the recorded investment in loans by segments follows: Allowance for Loan Losses Year Ended December 31, 2022 Commercial Agricultural Residential Real Estate Consumer Unallocated Total January 1, 2022 $ 1,740 $ 289 $ 747 $ 908 $ 5,419 $ 9,103 Charge-offs (77) — — (542) — (619) Recoveries 442 9 150 282 — 883 Provision for loan losses (784) 279 (280) 313 955 483 December 31, 2022 $ 1,321 $ 577 $ 617 $ 961 $ 6,374 $ 9,850 Allowance for Loan Losses Year Ended December 31, 2021 Commercial Agricultural Residential Real Estate Consumer Unallocated Total January 1, 2021 $ 2,162 $ 311 $ 1,363 $ 798 $ 5,110 $ 9,744 Charge-offs (32) (77) (12) (486) — (607) Recoveries 133 12 162 177 — 484 Provision for loan losses (523) 43 (766) 419 309 (518) December 31, 2021 $ 1,740 $ 289 $ 747 $ 908 $ 5,419 $ 9,103 Allowance for Loan Losses and Recorded Investment in Loans As of December 31, 2022 Commercial Agricultural Residential Real Estate Consumer Unallocated Total ALLL Individually evaluated for impairment $ 12 $ — $ 439 $ — $ — $ 451 Collectively evaluated for impairment 1,309 577 178 961 6,374 9,399 Total $ 1,321 $ 577 $ 617 $ 961 $ 6,374 $ 9,850 Loans Individually evaluated for impairment $ 8,342 $ 10,935 $ 2,741 $ — $ 22,018 Collectively evaluated for impairment 732,578 93,379 338,144 78,054 1,242,155 Total $ 740,920 $ 104,314 $ 340,885 $ 78,054 $ 1,264,173 Allowance for Loan Losses and Recorded Investment in Loans As of December 31, 2021 Commercial Agricultural Residential Real Estate Consumer Unallocated Total ALLL Individually evaluated for impairment $ 13 $ — $ 565 $ — $ — $ 578 Collectively evaluated for impairment 1,727 289 182 908 5,419 8,525 Total $ 1,740 $ 289 $ 747 $ 908 $ 5,419 $ 9,103 Loans Individually evaluated for impairment $ 9,267 $ 14,189 $ 3,454 $ — $ 26,910 Collectively evaluated for impairment 798,172 79,766 322,907 73,282 1,274,127 Total $ 807,439 $ 93,955 $ 326,361 $ 73,282 $ 1,301,037 The following tables display the credit quality indicators for commercial and agricultural credit exposures based on internally assigned credit risk ratings as of December 31: 2022 Commercial Agricultural Real Estate Other Advances to Mortgage Brokers Total Real Estate Other Total Total Rating 1 - Excellent $ — $ — $ — $ — $ — $ — $ — $ — 2 - High quality 9,045 4,533 — 13,578 342 100 442 14,020 3 - High satisfactory 68,133 36,608 — 104,741 9,757 4,608 14,365 119,106 4 - Low satisfactory 471,009 114,565 — 585,574 43,587 21,214 64,801 650,375 5 - Special mention 20,770 7,447 — 28,217 12,262 4,634 16,896 45,113 6 - Substandard 5,629 3,085 — 8,714 6,316 1,260 7,576 16,290 7 - Vulnerable 74 22 — 96 67 167 234 330 8 - Doubtful — — — — — — — — 9 - Loss — — — — — — — — Total $ 574,660 $ 166,260 $ — $ 740,920 $ 72,331 $ 31,983 $ 104,314 $ 845,234 2021 Commercial Agricultural Real Estate Other Advances to Mortgage Brokers Total Real Estate Other Total Total Rating 1 - Excellent $ — $ 300 $ — $ 300 $ — $ — $ — $ 300 2 - High quality 9,010 6,881 — 15,891 453 — 453 16,344 3 - High satisfactory 86,135 46,087 72,001 204,223 9,361 4,295 13,656 217,879 4 - Low satisfactory 448,489 104,375 — 552,864 36,483 15,986 52,469 605,333 5 - Special mention 13,212 1,351 — 14,563 13,096 3,452 16,548 31,111 6 - Substandard 13,519 5,738 — 19,257 6,252 3,803 10,055 29,312 7 - Vulnerable 222 119 — 341 499 275 774 1,115 8 - Doubtful — — — — — — — — 9 - Loss — — — — — — — — Total $ 570,587 $ 164,851 $ 72,001 $ 807,439 $ 66,144 $ 27,811 $ 93,955 $ 901,394 Internally assigned credit risk ratings are reviewed, at a minimum, when loans are renewed or when management has knowledge of improvements or deterioration of the credit quality of individual credits. Descriptions of the internally assigned credit risk ratings for commercial and agricultural loans are as follows: 1. EXCELLENT – Substantially Risk Free Credit has strong financial condition and solid earnings history, characterized by: • High liquidity, strong cash flow, low leverage. • Unquestioned ability to meet all obligations when due. • Experienced management, with management succession in place. • Secured by cash. 2. HIGH QUALITY – Limited Risk Credit with sound financial condition and a positive trend in earnings supplemented by: • Favorable liquidity and leverage ratios. • Ability to meet all obligations when due. • Management with successful track record. • Steady and satisfactory earnings history. • If loan is secured, collateral is of high quality and readily marketable. • Access to alternative financing. • Well defined primary and secondary source of repayment. • If supported by guaranty, the financial strength and liquidity of the guarantor(s) are clearly evident. 3. HIGH SATISFACTORY – Reasonable Risk Credit with satisfactory financial condition and further characterized by: • Working capital adequate to support operations. • Cash flow sufficient to pay debts as scheduled. • Management experience and depth appear favorable. • Loan performing according to terms. • If loan is secured, collateral is acceptable and loan is fully protected. 4. LOW SATISFACTORY – Acceptable Risk Credit with bankable risks, although some signs of weaknesses are shown: • Would include most start-up businesses. • Occasional instances of trade slowness or repayment delinquency – may have been 10-30 days slow within the past year. • Management’s abilities are apparent yet unproven. • Weakness in primary source of repayment with adequate secondary source of repayment. • Loan structure generally in accordance with policy. • If secured, loan collateral coverage is marginal. To be classified as less than satisfactory, only one of the following criteria must be met. 5. SPECIAL MENTION – Criticized Credit constitutes an undue and unwarranted credit risk but not to the point of justifying a classification of substandard. The credit risk may be relatively minor yet constitutes an unwarranted risk in light of the circumstances surrounding a specific loan: • Downward trend in sales, profit levels, and margins. • Impaired working capital position. • Cash flow is strained in order to meet debt repayment. • Loan delinquency (30-60 days) and overdrafts may occur. • Shrinking equity cushion. • Diminishing primary source of repayment and questionable secondary source. • Management abilities are questionable. • Weak industry conditions. • Litigation pending against the borrower. • Loan may need to be restructured to improve collateral position or reduce payments. • Collateral or guaranty offers limited protection. • Negative debt service coverage, however the credit is well collateralized and payments are current. 6. SUBSTANDARD – Classified Credit is inadequately protected by the current net worth and paying capacity of the borrower or of the collateral pledged. There is a distinct possibility we will implement collection procedures if the loan deficiencies are not corrected. Any commercial loan placed in nonaccrual status will be rated “7” or worse. In addition, the following characteristics may apply: • Sustained losses have severely eroded the equity and cash flow. • Deteriorating liquidity. • Serious management problems or internal fraud. • Original repayment terms liberalized. • Likelihood of bankruptcy. • Inability to access other funding sources. • Reliance on secondary source of repayment. • Litigation filed against borrower. • Interest non-accrual may be warranted. • Collateral provides little or no value. • Requires excessive attention of the loan officer. • Borrower is uncooperative with loan officer. 7. VULNERABLE – Classified Credit is considered “Substandard” and warrants placing in nonaccrual status. Risk of loss is being evaluated and exit strategy options are under review. Other characteristics that may apply: • Insufficient cash flow to service debt. • Minimal or no payments being received. • Limited options available to avoid the collection process. • Transition status, expect action will take place to collect loan without immediate progress being made. 8. DOUBTFUL – Workout Credit has all the weaknesses inherent in a “Substandard” loan with the added characteristic that collection and/or liquidation is pending. The possibility of a loss is extremely high, but its classification as a loss is deferred until liquidation procedures are completed, or reasonably estimable. Other characteristics that may apply: • Normal operations are severely diminished or have ceased. • Seriously impaired cash flow. • Original repayment terms materially altered. • Secondary source of repayment is inadequate. • Survivability as a “going concern” is impossible. • Collection process has begun. • Bankruptcy petition has been filed. • Judgments have been filed. • Portion of the loan balance has been charged-off. 9. LOSS – Charge-off Credit is considered uncollectible and of such little value that their continuance as bankable assets is not warranted. This classification is for charged-off loans but does not mean that the asset has absolutely no recovery or salvage value. These loans are further characterized by: • Liquidation or reorganization under Bankruptcy, with poor prospects of collection. • Fraudulently overstated assets and/or earnings. • Collateral has marginal or no value. • Debtor cannot be located. • Over 120 days delinquent. Our primary credit quality indicator for residential real estate and consumer loans is the individual loan’s past due aging. The following tables summarize the past due and current loans for the entire loan portfolio as of December 31: 2022 Accruing Interest Total Past Due and Nonaccrual 30-59 60-89 90 Days Nonaccrual Current Total Commercial Commercial real estate $ 4,553 $ 2,570 $ — $ 74 $ 7,197 $ 567,463 $ 574,660 Commercial other 285 — — 22 307 165,953 166,260 Advances to mortgage brokers — — — — — — — Total commercial 4,838 2,570 — 96 7,504 733,416 740,920 Agricultural Agricultural real estate — — — 67 67 72,264 72,331 Agricultural other — — — 167 167 31,816 31,983 Total agricultural — — — 234 234 104,080 104,314 Residential real estate Senior liens 2,943 225 — 127 3,295 301,606 304,901 Junior liens — — — — — 3,282 3,282 Home equity lines of credit 38 — — — 38 32,664 32,702 Total residential real estate 2,981 225 — 127 3,333 337,552 340,885 Consumer Secured 47 8 — — 55 74,886 74,941 Unsecured 4 — — — 4 3,109 3,113 Total consumer 51 8 — — 59 77,995 78,054 Total $ 7,870 $ 2,803 $ — $ 457 $ 11,130 $ 1,253,043 $ 1,264,173 2021 Accruing Interest Total Past Due and Nonaccrual 30-59 60-89 90 Days Nonaccrual Current Total Commercial Commercial real estate $ 135 $ — $ — $ 222 $ 357 $ 570,230 $ 570,587 Commercial other 85 — — 119 204 164,647 164,851 Advances to mortgage brokers — — — — — 72,001 72,001 Total commercial 220 — — 341 561 806,878 807,439 Agricultural Agricultural real estate 213 — — 499 712 65,432 66,144 Agricultural other — — — 275 275 27,536 27,811 Total agricultural 213 — — 774 987 92,968 93,955 Residential real estate Senior liens 2,016 37 97 93 2,243 290,900 293,143 Junior liens — — — — — 2,439 2,439 Home equity lines of credit 7 — — 37 44 30,735 30,779 Total residential real estate 2,023 37 97 130 2,287 324,074 326,361 Consumer Secured 186 — — — 186 70,259 70,445 Unsecured 10 — — — 10 2,827 2,837 Total consumer 196 — — — 196 73,086 73,282 Total $ 2,652 $ 37 $ 97 $ 1,245 $ 4,031 $ 1,297,006 $ 1,301,037 Impaired Loans Loans may be classified as impaired if they meet one or more of the following criteria: 1. There has been a charge-off of its principal balance (in whole or in part); 2. The loan has been classified as a TDR; or 3. The loan is in nonaccrual status. Impairment is measured on a loan-by-loan basis for commercial and agricultural loans by comparing the loan’s outstanding balance to the present value of expected future cash flows discounted at the loan’s effective interest rate, or the fair value of the collateral, less costs to sell, if the loan is collateral dependent. Large groups of smaller-balance, homogeneous residential real estate and consumer loans are collectively evaluated for impairment by comparing the loan’s unpaid principal balance to the present value of expected future cash flows discounted at the loan’s effective interest rate. We do not recognize interest income on impaired loans in nonaccrual status. For impaired loans not classified as nonaccrual, interest income is recognized daily, as earned, according to the terms of the loan agreement and the principal amount outstanding. The following summarizes information pertaining to impaired loans as of, and for the years ended, December 31: 2022 Recorded Balance Unpaid Principal Balance Valuation Allowance Average Recorded Balance Interest Income Recognized Impaired loans with a valuation allowance Commercial real estate $ 183 $ 184 $ 12 $ 189 $ 12 Commercial other — — — 1,724 62 Residential real estate senior liens 2,741 3,001 439 3,056 126 Total impaired loans with a valuation allowance 2,924 3,185 451 4,969 200 Impaired loans without a valuation allowance Commercial real estate 5,366 5,682 5,514 338 Commercial other 2,793 2,793 626 58 Agricultural real estate 8,522 8,522 8,568 468 Agricultural other 2,413 2,413 2,984 157 Home equity lines of credit — — 5 — Total impaired loans without a valuation allowance 19,094 19,410 17,697 1,021 Impaired loans Commercial 8,342 8,659 12 8,053 470 Agricultural 10,935 10,935 — 11,552 625 Residential real estate 2,741 3,001 439 3,061 126 Total impaired loans $ 22,018 $ 22,595 $ 451 $ 22,666 $ 1,221 2021 Recorded Balance Unpaid Principal Balance Valuation Allowance Average Recorded Balance Interest Income Recognized Impaired loans with a valuation allowance Commercial real estate $ 192 $ 193 $ 9 $ 1,668 $ 69 Commercial other 2,802 2,802 4 1,909 103 Agricultural real estate — — — 553 11 Agricultural other — — — 169 — Residential real estate senior liens 3,417 3,688 565 3,794 151 Total impaired loans with a valuation allowance 6,411 6,683 578 8,093 334 Impaired loans without a valuation allowance Commercial real estate 5,829 6,145 6,313 398 Commercial other 444 444 1,963 68 Agricultural real estate 9,538 9,538 9,739 699 Agricultural other 4,651 4,651 4,269 235 Home equity lines of credit 37 37 5 — Total impaired loans without a valuation allowance 20,499 20,815 22,289 1,400 Impaired loans Commercial 9,267 9,584 13 11,853 638 Agricultural 14,189 14,189 — 14,730 945 Residential real estate 3,454 3,725 565 3,799 151 Total impaired loans $ 26,910 $ 27,498 $ 578 $ 30,382 $ 1,734 We had committed to advance $0 and $266 in additional funds to be disbursed in connection with impaired loans, which includes TDRs, as of December 31, 2022 and 2021, respectively. Troubled Debt Restructurings A loan modification is considered to be a TDR when the modification includes terms outside of normal lending practices to a borrower who is experiencing financial difficulties. Typical concessions granted include, but are not limited to: 1. Agreeing to interest rates below prevailing market rates for debt with similar risk characteristics. 2. Extending the amortization period beyond typical lending guidelines for loans with similar risk characteristics. 3. Agreeing to an interest only payment structure and delaying principal payments. 4. Forgiving principal. 5. Forgiving accrued interest. To determine if a borrower is experiencing financial difficulties, factors we consider include: 1. The borrower is currently in default on any of their debt. 2. The borrower would likely default on any of their debt if the concession is not granted. 3. The borrower’s cash flow is insufficient to service all of their debt if the concession is not granted. 4. The borrower has declared, or is in the process of declaring, bankruptcy. 5. The borrower is unlikely to continue as a going concern (if the entity is a business). The following is a summary of information pertaining to TDRs granted in the years ended December 31: 2022 2021 Number of Loans Pre-Modification Recorded Investment Post-Modification Recorded Investment Number of Loans Pre-Modification Recorded Investment Post-Modification Recorded Investment Commercial other 3 $ 2,871 $ 2,871 5 $ 4,761 $ 4,761 Agricultural other — — — 6 3,712 3,712 Residential real estate 1 98 98 — — — Total 4 $ 2,969 $ 2,969 11 $ 8,473 $ 8,473 The following table summarizes the nature of the concessions we granted to borrowers in financial difficulty in the years ended December 31: 2022 2021 Below Market Interest Rate Below Market Interest Rate and Extension of Amortization Period Below Market Interest Rate Below Market Interest Rate and Extension of Amortization Period Number of Loans Pre-Modification Recorded Investment Number of Loans Pre-Modification Recorded Investment Number of Loans Pre-Modification Recorded Investment Number of Loans Pre-Modification Recorded Investment Commercial other 3 $ 2,871 — $ — 1 $ 3,189 4 $ 1,572 Agricultural other — — — — 6 3,712 — — Residential real estate — — 1 98 — — — — Total 3 $ 2,871 1 $ 98 7 $ 6,901 4 $ 1,572 We did not restructure any loans by forgiving principal or accrued interest during 2022 or 2021. Based on our historical loss experience, losses associated with TDRs are not significantly different than other impaired loans within the same loan segment. As such, TDRs, including TDRs that have been modified in the past 12 months that subsequently defaulted, are analyzed in the same manner as other impaired loans within their respective loan segment. We had no loans that defaulted in the years ended December 31, 2022 and 2021, which were modified within 12 months prior to the default date. The following is a summary of TDR loan balances as of December 31: 2022 2021 TDRs $ 21,339 $ 25,725 |
Premises and Equipment
Premises and Equipment | 12 Months Ended |
Dec. 31, 2022 | |
Property, Plant and Equipment [Abstract] | |
Premises and Equipment | Premises and Equipment A summary of premises and equipment at December 31 follows: 2022 2021 Land $ 5,904 $ 6,164 Buildings and improvements 31,260 30,738 Furniture and equipment 35,906 36,132 Total 73,070 73,034 Less: accumulated depreciation 47,517 48,615 Premises and equipment, net $ 25,553 $ 24,419 Depreciation expense amounted to $2,071, $2,314, and $2,620 in 2022, 2021, and 2020, respectively. |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 12 Months Ended |
Dec. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets The carrying amount of goodwill was $48,282 at December 31, 2022 and 2021. Identifiable intangible assets were as follows as of December 31: 2022 Gross Accumulated Net Core deposit premium resulting from acquisitions $ 5,579 $ 5,574 $ 5 2021 Gross Accumulated Net Core deposit premium resulting from acquisitions $ 5,579 $ 5,559 $ 20 Amortization expense associated with identifiable intangible assets was $15, $29, and $48 in 2022, 2021, and 2020, respectively. Estimated amortization expense associated with identifiable intangibles for each of the next three years succeeding December 31, 2022, and thereafter is as follows: Estimated Amortization Expense 2023 $ 2 2024 2 2025 1 Total $ 5 |
Deposits
Deposits | 12 Months Ended |
Dec. 31, 2022 | |
Deposits [Abstract] | |
Deposits | Deposits Scheduled annual maturities of time deposits for each of the next five years, and thereafter, are as follows: Scheduled Maturities of Time Deposits 2023 $ 153,482 2024 41,744 2025 23,288 2026 18,364 2027 15,055 Thereafter 107 Total $ 252,040 Interest expense on time deposits greater than $250 was $621 in 2022, $980 in 2021 and $1,883 in 2020. |
Borrowed Funds
Borrowed Funds | 12 Months Ended |
Dec. 31, 2022 | |
Debt Disclosure [Abstract] | |
Borrowed Funds | Borrowed Funds Federal funds purchased and repurchase agreements Securities sold under repurchase agreements without stated maturity dates, federal funds purchased, and FRB Discount Window advances generally mature within one to four days from the transaction date. We had no FRB Discount Window advances for the years ended December 31, 2022 and 2021. The following table provides a summary of securities sold under repurchase agreements without stated maturity dates and federal funds purchased for the years ended December 31: 2022 2021 Maximum Month End Balance Average Balance Weighted Average Interest Rate During the Period Maximum Month End Balance Average Balance Weighted Average Interest Rate During the Period Securities sold under agreements to repurchase without stated maturity dates $ 58,140 $ 49,973 0.16 % $ 71,059 $ 57,451 0.09 % Federal funds purchased — 1 3.02 % 80 2 0.47 % Securities sold under agreements to repurchase are classified as secured borrowings and are reflected at the amount of cash received in connection with the transaction. The securities underlying the agreements have a carrying value and a fair value of $58,291 and $50,173 at December 31, 2022 and 2021, respectively. Such securities remain under our control. We may be required to provide additional collateral based on the fair value of underlying securities. Securities sold under repurchase agreements without stated maturity dates were as follows at December 31: 2022 2021 Amount Rate Amount Rate Securities sold under agreements to repurchase without stated maturity dates $ 57,771 0.49 % $ 50,162 0.07 % We had pledged AFS securities and 1-4 family residential real estate loans in the following amounts at December 31: 2022 2021 Pledged to secure borrowed funds $ 347,331 $ 334,415 Pledged to secure repurchase agreements 58,291 50,173 Pledged for public deposits and for other purposes necessary or required by law 48,698 28,154 Total $ 454,320 $ 412,742 AFS securities pledged to repurchase agreements without stated maturity dates consisted of the following at December 31: 2022 2021 U.S. Treasury $ 29,351 $ 9,711 States and political subdivisions 11,037 13,491 Mortgage-backed securities 6,819 13,174 Collateralized mortgage obligations 11,084 13,797 Total $ 58,291 $ 50,173 AFS securities pledged to repurchase agreements are monitored to ensure the appropriate level is collateralized. In the event of maturities, calls, significant principal repayments, or significant decline in market values, we have an adequate level of AFS securities to pledge to satisfy collateral requirements. As of December 31, 2022, we had the ability to borrow up to an additional $344,393, without pledging additional collateral. FHLB advances FHLB advances are collateralized by a blanket lien on all qualified 1-4 family residential real estate loans, specific AFS securities, and FHLB stock. The following table lists the maturities and weighted average interest rates of FHLB advances as of: 2022 2021 Amount Rate Amount Rate Fixed rate due 2022 $ — 0.00 % $ 20,000 1.97 % Subordinated Notes On June 2, 2021, we completed a private placement of $30,000 in aggregate principal amount of 3.25% Fixed-to-Floating Rate Subordinated Notes due 2031 (the "Notes"). The Notes will initially bear a fixed interest rate of 3.25% until June 15, 2026, after which time until maturity on June 15, 2031, the interest rate will reset quarterly to an annual floating rate equal to the then-current 3-month SOFR plus 256 basis points. The Notes are redeemable by us at our option, in whole or in part, on or after June 15, 2026. The Notes are not subject to redemption at the option of the holders. The following table summarizes our outstanding notes at December 31: 2022 2021 Amount Rate Amount Rate Fixed rate at 3.25% to floating, due 2031 $ 30,000 3.25 % $ 30,000 3.25 % Unamortized issuance costs (755) (842) Total subordinated debt, net $ 29,245 $ 29,158 |
Off-Balance-Sheet Activities
Off-Balance-Sheet Activities | 12 Months Ended |
Dec. 31, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Off-Balance-Sheet Activities | Off-Balance-Sheet Activities, Commitments and Other Matters Credit-Related Financial Instruments We are party to credit related financial instruments with off-balance-sheet risk. These financial instruments are entered into in the normal course of business to meet the financing needs of our customers. These financial instruments involve, to varying degrees, elements of credit and IRR in excess of the amounts recognized in the consolidated balance sheets. The contractual or notional amounts of these instruments reflect the extent of involvement we have in a particular class of financial instrument. The following table summarizes our credit related financial instruments with off-balance-sheet risk as of December 31: 2022 2021 Unfunded commitments under lines of credit $ 264,902 $ 231,120 Commercial and standby letters of credit 1,321 1,738 Commitments to grant loans 24,770 32,448 Total $ 290,993 $ 265,306 Unfunded commitments under lines of credit are commitments for possible future extensions of credit to existing customers. These commitments may expire without being drawn upon and do not necessarily represent future cash requirements. Advances to mortgage brokers are also included in unfunded commitments under lines of credit. The unfunded commitment amount is the difference between our outstanding balances and maximum outstanding aggregate amount. Commitments to grant loans are agreements to lend to a customer as long as there is no violation of any condition established in the contract. Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. The amount of collateral obtained, if it is deemed necessary, is based on management's credit evaluation of the customer. Commitments to grant loans include residential mortgage loans that may be committed to be sold to the secondary market. Commercial and standby letters of credit are conditional commitments we issued to guarantee the performance of a customer to a third party. Those guarantees are primarily issued to support private borrowing arrangements, including commercial paper, bond financing, and similar transactions. These commitments to extend credit and letters of credit generally mature within one year. The credit risk involved in these transactions is essentially the same as that involved in extending loans to customers. We evaluate each customer’s credit worthiness on a case-by-case basis. The amount of collateral obtained, if deemed necessary upon the extension of credit, is based on our credit evaluation of the borrower. While we consider standby letters of credit to be guarantees, the amount of the liability related to such guarantees on the commitment date is not significant and a liability related to such guarantees is not recorded on the consolidated balance sheets. Our exposure to credit-related loss in the event of nonperformance by the counter parties to the financial instruments for commitments to extend credit and standby letters of credit could be up to the contractual notional amount of those instruments. We use the same credit policies as we do for extending loans to customers. No significant losses are anticipated as a result of these commitments. Derivative Loan Commitments Mortgage loan commitments are referred to as derivative loan commitments if the loan that will result from exercise of the commitment will be held for sale upon funding. We enter into commitments to fund residential mortgage loans at specific times in the future, with the intention that these loans will subsequently be sold in the secondary market. A mortgage loan commitment binds us to lend funds to a potential borrower at a specified interest rate within a specified period of time, generally up to 60 days after inception of the rate lock. Outstanding derivative loan commitments expose us to the risk that the price of the loans arising from the exercise of the loan commitment might decline from the inception of the rate lock to funding of the loan due to increases in mortgage interest rates. If interest rates increase, the value of these loan commitments decreases. Conversely, if interest rates decrease, the value of these loan commitments increase. The notional amount of undesignated interest rate lock commitments was $0 and $788 at December 31, 2022 and 2021, respectively. Forward Loan Sale Commitments To protect against the price risk inherent in derivative loan commitments, we utilize both “mandatory delivery” and “best efforts” forward loan sale commitments to mitigate the risk of potential decreases in the values of loan that would result from the exercise of the derivative loan commitments. With a “mandatory delivery” contract, we commit to deliver a certain principal amount of mortgage loans to an investor at a specified price on or before a specified date. If we fail to deliver the amount of mortgages necessary to fulfill the commitment by the specified date, we are obligated to pay a “pair-off” fee, based on then current market prices, to the investor to compensate the investor for the shortfall. With a “best efforts” contract, we commit to deliver an individual mortgage loan of a specified principal amount and quality to an investor if the loan to the underlying borrower closes. Generally, the price the investor will pay the seller for an individual loan is specified prior to the loan being funded (e.g. on the same day the lender commits to lend funds to a potential borrower). We expect that these forward loan sale commitments will experience changes in fair value opposite to the change in fair value of derivative loan commitments. The notional amount of undesignated forward loan sale commitments was $379 and $2,255 at December 31, 2022 and 2021, respectively. The fair value of these forward loan sale commitments was $394 and $2,330 at December 31, 2022 and 2021, respectively. The fair values of the rate lock loan commitments related to the origination of mortgage loans that will be held for sale and the forward loan sale commitments are deemed insignificant by management and, accordingly, are not recorded in our consolidated financial statements. Other Matters Correspondent banks may require us to maintain minimum cash reserve balances. The reserve balances related to correspondent banks amounted to $500 for the years ended December 31, 2022 and 2021. Banking regulations limit the transfer of assets in the form of dividends, loans, or advances from the Bank to the Corporation. At December 31, 2022, substantially all of the Bank’s assets were restricted from transfer to the Corporation in the form of loans or advances. Bank dividends are the principal source of funds for the Corporation. Payment of dividends without regulatory approval is limited to the current year’s retained net income plus retained net income for the preceding two years, less any required transfers to common stock. At January 1, 2023, the amount available to the Corporation for dividends from the Bank, without regulatory approval, was approximately $39,800. |
Commitments and Other Matters
Commitments and Other Matters | 12 Months Ended |
Dec. 31, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Other Matters | Off-Balance-Sheet Activities, Commitments and Other Matters Credit-Related Financial Instruments We are party to credit related financial instruments with off-balance-sheet risk. These financial instruments are entered into in the normal course of business to meet the financing needs of our customers. These financial instruments involve, to varying degrees, elements of credit and IRR in excess of the amounts recognized in the consolidated balance sheets. The contractual or notional amounts of these instruments reflect the extent of involvement we have in a particular class of financial instrument. The following table summarizes our credit related financial instruments with off-balance-sheet risk as of December 31: 2022 2021 Unfunded commitments under lines of credit $ 264,902 $ 231,120 Commercial and standby letters of credit 1,321 1,738 Commitments to grant loans 24,770 32,448 Total $ 290,993 $ 265,306 Unfunded commitments under lines of credit are commitments for possible future extensions of credit to existing customers. These commitments may expire without being drawn upon and do not necessarily represent future cash requirements. Advances to mortgage brokers are also included in unfunded commitments under lines of credit. The unfunded commitment amount is the difference between our outstanding balances and maximum outstanding aggregate amount. Commitments to grant loans are agreements to lend to a customer as long as there is no violation of any condition established in the contract. Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. The amount of collateral obtained, if it is deemed necessary, is based on management's credit evaluation of the customer. Commitments to grant loans include residential mortgage loans that may be committed to be sold to the secondary market. Commercial and standby letters of credit are conditional commitments we issued to guarantee the performance of a customer to a third party. Those guarantees are primarily issued to support private borrowing arrangements, including commercial paper, bond financing, and similar transactions. These commitments to extend credit and letters of credit generally mature within one year. The credit risk involved in these transactions is essentially the same as that involved in extending loans to customers. We evaluate each customer’s credit worthiness on a case-by-case basis. The amount of collateral obtained, if deemed necessary upon the extension of credit, is based on our credit evaluation of the borrower. While we consider standby letters of credit to be guarantees, the amount of the liability related to such guarantees on the commitment date is not significant and a liability related to such guarantees is not recorded on the consolidated balance sheets. Our exposure to credit-related loss in the event of nonperformance by the counter parties to the financial instruments for commitments to extend credit and standby letters of credit could be up to the contractual notional amount of those instruments. We use the same credit policies as we do for extending loans to customers. No significant losses are anticipated as a result of these commitments. Derivative Loan Commitments Mortgage loan commitments are referred to as derivative loan commitments if the loan that will result from exercise of the commitment will be held for sale upon funding. We enter into commitments to fund residential mortgage loans at specific times in the future, with the intention that these loans will subsequently be sold in the secondary market. A mortgage loan commitment binds us to lend funds to a potential borrower at a specified interest rate within a specified period of time, generally up to 60 days after inception of the rate lock. Outstanding derivative loan commitments expose us to the risk that the price of the loans arising from the exercise of the loan commitment might decline from the inception of the rate lock to funding of the loan due to increases in mortgage interest rates. If interest rates increase, the value of these loan commitments decreases. Conversely, if interest rates decrease, the value of these loan commitments increase. The notional amount of undesignated interest rate lock commitments was $0 and $788 at December 31, 2022 and 2021, respectively. Forward Loan Sale Commitments To protect against the price risk inherent in derivative loan commitments, we utilize both “mandatory delivery” and “best efforts” forward loan sale commitments to mitigate the risk of potential decreases in the values of loan that would result from the exercise of the derivative loan commitments. With a “mandatory delivery” contract, we commit to deliver a certain principal amount of mortgage loans to an investor at a specified price on or before a specified date. If we fail to deliver the amount of mortgages necessary to fulfill the commitment by the specified date, we are obligated to pay a “pair-off” fee, based on then current market prices, to the investor to compensate the investor for the shortfall. With a “best efforts” contract, we commit to deliver an individual mortgage loan of a specified principal amount and quality to an investor if the loan to the underlying borrower closes. Generally, the price the investor will pay the seller for an individual loan is specified prior to the loan being funded (e.g. on the same day the lender commits to lend funds to a potential borrower). We expect that these forward loan sale commitments will experience changes in fair value opposite to the change in fair value of derivative loan commitments. The notional amount of undesignated forward loan sale commitments was $379 and $2,255 at December 31, 2022 and 2021, respectively. The fair value of these forward loan sale commitments was $394 and $2,330 at December 31, 2022 and 2021, respectively. The fair values of the rate lock loan commitments related to the origination of mortgage loans that will be held for sale and the forward loan sale commitments are deemed insignificant by management and, accordingly, are not recorded in our consolidated financial statements. Other Matters Correspondent banks may require us to maintain minimum cash reserve balances. The reserve balances related to correspondent banks amounted to $500 for the years ended December 31, 2022 and 2021. Banking regulations limit the transfer of assets in the form of dividends, loans, or advances from the Bank to the Corporation. At December 31, 2022, substantially all of the Bank’s assets were restricted from transfer to the Corporation in the form of loans or advances. Bank dividends are the principal source of funds for the Corporation. Payment of dividends without regulatory approval is limited to the current year’s retained net income plus retained net income for the preceding two years, less any required transfers to common stock. At January 1, 2023, the amount available to the Corporation for dividends from the Bank, without regulatory approval, was approximately $39,800. |
Minimum Regulatory Capital Requ
Minimum Regulatory Capital Requirements | 12 Months Ended |
Dec. 31, 2022 | |
Banking Regulation, Risk-Based Information [Abstract] | |
Minimum Regulatory Capital Requirements | Minimum Regulatory Capital Requirements The Corporation (on a consolidated basis) and the Bank are subject to various regulatory capital requirements administered by the FRB and the FDIC. Failure to meet minimum capital requirements can initiate mandatory and possibly additional discretionary actions by the FRB and the FDIC that, if undertaken, could have a material effect on our financial statements. Under regulatory capital adequacy guidelines and the regulatory framework for prompt corrective action, we must meet specific capital guidelines that include quantitative measures of assets, liabilities, capital, and certain off-balance-sheet items, as calculated under regulatory accounting standards. Our capital amounts and classifications are also subject to qualitative judgments by the FRB and the FDIC about components, risk weightings, and other factors. Prompt corrective action provisions are not applicable to bank holding companies. Quantitative measures established by regulation to ensure capital adequacy require us to maintain minimum amounts and ratios (set forth in the following table) of total capital, tier 1 capital, and common equity tier 1 capital (as defined in the regulations) to risk-weighted assets (as defined) and tier 1 capital to average assets (as defined). We believe, as of December 31, 2022 and 2021, that we met all capital adequacy requirements. The FRB has established minimum risk-based capital guidelines. Pursuant to these guidelines, a framework has been established that assigns risk weights to each category of on and off-balance-sheet items to arrive at risk adjusted total assets. Regulatory capital is divided by the risk adjusted assets with the resulting ratio compared to the minimum standard to determine whether a corporation has adequate capital. The common equity tier 1 capital ratio has a minimum requirement of 4.50%. The minimum standard for primary, or Tier 1 capital is 6.00% and the minimum standard for total capital is 8.00%. As of December 31, 2022 and 2021, the most recent notifications from the FRB and the FDIC categorized us as well capitalized under the regulatory framework for prompt corrective action. To be categorized as well capitalized, an institution must maintain total risk-based, Tier 1 risk-based, Common Equity Tier 1, and Tier 1 leverage ratios as set forth in the following tables. There were no conditions or events since the notifications that we believe have changed our categories. Our actual capital amounts and ratios are also presented in the table. Actual Minimum Minimum To Be Well Amount Ratio Amount Ratio Amount Ratio December 31, 2022 Common equity Tier 1 capital to risk weighted assets Isabella Bank $ 190,060 14.07 % $ 94,565 7.00 % $ 87,811 6.50 % Consolidated 175,112 12.91 % 94,948 7.00 % N/A N/A Tier 1 capital to risk weighted assets Isabella Bank 190,060 14.07 % 114,829 8.50 % 108,075 8.00 % Consolidated 175,112 12.91 % 115,295 8.50 % N/A N/A Total capital to risk weighted assets Isabella Bank 199,910 14.80 % 141,848 10.50 % 135,093 10.00 % Consolidated 214,207 15.79 % 142,423 10.50 % N/A N/A Tier 1 capital to average assets Isabella Bank 190,060 9.36 % 81,181 4.00 % 101,476 5.00 % Consolidated 175,112 8.61 % 81,392 4.00 % N/A N/A Actual Minimum Minimum To Be Well Amount Ratio Amount Ratio Amount Ratio December 31, 2021 Common equity Tier 1 capital to risk weighted assets Isabella Bank $ 171,255 12.91 % $ 92,849 7.00 % $ 86,217 6.50 % Consolidated 160,871 12.07 % 93,297 7.00 % N/A N/A Tier 1 capital to risk weighted assets Isabella Bank 171,255 12.91 % 112,746 8.50 % 106,114 8.00 % Consolidated 160,871 12.07 % 113,289 8.50 % N/A N/A Total capital to risk weighted assets Isabella Bank 180,358 13.60 % 139,274 10.50 % 132,642 10.00 % Consolidated 199,132 14.94 % 139,945 10.50 % N/A N/A Tier 1 capital to average assets Isabella Bank 171,255 8.54 % 80,171 4.00 % 100,214 5.00 % Consolidated 160,871 7.97 % 80,733 4.00 % N/A N/A |
Computation of Earnings Per Com
Computation of Earnings Per Common Share | 12 Months Ended |
Dec. 31, 2022 | |
Earnings Per Share [Abstract] | |
Computation of Earnings Per Common Share | Computation of Earnings Per Common Share Basic earnings per common share represents income available to common shareholders divided by the weighted average number of common shares outstanding during the period. Diluted earnings per common share includes additional common shares that would have been outstanding if dilutive potential common shares had been issued. For further information related to potential common shares that may be issued relate solely to outstanding shares in the Directors Plan and grant awards under the RSP, see "Note 12 – Benefit Plans." Earnings per common share have been computed based on the following for the years ended December 31: 2022 2021 2020 Average number of common shares outstanding for basic calculation 7,549,878 7,853,398 7,959,705 Average potential effect of common shares in the Directors Plan (1) 70,329 99,813 143,878 Average potential effect of common shares in the RSP 27,405 12,750 2,508 Average number of common shares outstanding used to calculate diluted earnings per common share 7,647,612 7,965,961 8,106,091 Net income $ 22,238 $ 19,499 $ 10,885 Earnings per common share Basic $ 2.95 $ 2.48 $ 1.37 Diluted $ 2.91 $ 2.45 $ 1.34 (1) Exclusive of shares held in the Rabbi Trust |
Benefit Plans
Benefit Plans | 12 Months Ended |
Dec. 31, 2022 | |
Retirement Benefits [Abstract] | |
Benefit Plans | Benefit Plans 401(k) Plan We have a 401(k) plan in which substantially all employees are eligible to participate. Employees may contribute up to 100% of their compensation subject to certain limits based on federal tax laws. The plan was amended in 2013 to provide a matching safe harbor contribution for all eligible employees equal to 100% of the first 5.0% of an employee's compensation contributed to the Plan during the year. Employees are 100% vested in the safe harbor matching contributions. For 2022, 2021 and 2020, expenses attributable to the plan were $805, $792, and $813, respectively. Defined Benefit Pension Plan We maintain a noncontributory defined benefit pension plan, which was curtailed effective March 1, 2007. As a result of the curtailment, future salary increases are no longer considered (the projected benefit obligation is equal to the accumulated benefit obligation), and plan benefits are based on years of service and the individual employee’s five highest consecutive years of compensation out of the last ten years of service through March 1, 2007. Changes in the projected benefit obligation and plan assets during each year, the funded status of the plan, and the net amount recognized in our consolidated balance sheets using an actuarial measurement date of December 31, are summarized as follows during the years ended December 31: 2022 2021 Change in benefit obligation Benefit obligation, January 1 $ 9,725 $ 10,358 Interest cost 224 233 Actuarial loss (gain) (2,236) (357) Benefits paid, including plan expenses (817) (509) Benefit obligation, December 31 6,896 9,725 Change in plan assets Fair value of plan assets, January 1 8,649 8,263 Investment return (loss) (1,250) 831 Contributions — 64 Benefits paid, including plan expenses (817) (509) Fair value of plan assets, December 31 6,582 8,649 Deficiency in funded status at December 31, included on the consolidated balance sheets in accrued interest payable and other liabilities $ (314) $ (1,076) Accumulated benefit obligation at December 31 $ 6,896 $ 9,725 2022 2021 Change in accrued pension benefit costs Accrued benefit cost at January 1 $ (1,076) $ (2,095) Contributions — 64 Net periodic benefit cost (credit) (59) 31 Net change in unrecognized actuarial loss and prior service cost 821 924 Accrued pension liability at December 31 $ (314) $ (1,076) We have recorded the funded status of the plan in our consolidated balance sheets. We adjust the underfunded status in a liability account to reflect the current funded status of the plan. Any gains or losses that arise during the year but are not recognized as components of net periodic benefit cost are recognized as a component of other comprehensive income (loss). The components of net periodic benefit cost are as follows for the years ended December 31: 2022 2021 2020 Interest cost on benefit obligation $ 224 $ 233 $ 306 Expected return on plan assets (490) (486) (488) Amortization of unrecognized actuarial net loss 216 222 206 Settlement loss 109 — 152 Net periodic benefit cost (credit) $ 59 $ (31) $ 176 During 2022, 2021 and 2020, settlement losses of $109, $0 and $152 were recognized in connection with lump-sum benefit distributions, respectively. Many plan participants elect to receive their retirement benefit payments in the form of lump-sum settlements. Pro rata settlement losses, which can occasionally occur as a result of these lump-sum distributions, are recognized only in years when the total of such distributions exceed the sum of the service and interest expense components of net periodic benefit cost. Accumulated other comprehensive income at December 31, 2022 includes net unrecognized pension costs before income taxes of $1,729. The actuarial assumptions used in determining the benefit obligation are as follows for the years ended December 31: 2022 2021 2020 Discount rate 4.88 % 2.43 % 2.30 % Expected long-term rate of return on plan assets 6.00 % 6.00 % 6.00 % The actuarial weighted average assumptions used in determining the net periodic pension costs are as follows for the years ended December 31: 2022 2021 2020 Discount rate 2.43 % 2.30 % 3.07 % Expected long-term rate of return on plan assets 6.00 % 6.00 % 6.00 % As a result of the curtailment of the Plan, there is no rate of compensation increase considered in the above assumptions. The expected long-term rate of return is an estimate of anticipated future long-term rates of return on plan assets as measured on a market value basis. Factors considered in arriving at this assumption include: • Historical long-term rates of return for broad asset classes. • Actual past rates of return achieved by the plan. • The general mix of assets held by the plan. • The stated investment policy for the plan. The selected rate of return is net of anticipated investment related expenses. Pension Plan Assets Our overall investment strategy is to moderately grow the portfolio by investing 50% of the portfolio in equity securities and 50% in fixed income securities. This strategy is designed to generate a long-term rate of return of 6.00%. Equity securities primarily consist of the S&P 500 Index with a smaller allocation to the Small Cap and International Index. Fixed income securities are invested in the Bond Market Index. The plan has appropriate assets invested in short-term investments to meet near term benefit payments. The asset mix and the sector weighting of the investments are determined by our benefits committee, which is comprised of members of our management. To manage the plan, we retain a third party investment advisor to conduct consultations. We review the performance of the advisor at least annually. The fair values of our pension plan assets by asset category were as follows as of December 31: 2022 2021 Total (Level 2) Total (Level 2) Short-term investments $ 235 $ 235 $ 127 $ 127 Common collective trusts Fixed income 2,983 2,983 3,750 3,750 Equity investments 3,364 3,364 4,772 4,772 Total $ 6,582 $ 6,582 $ 8,649 $ 8,649 The following is a description of the valuation methodologies used for assets measured at fair value. There have been no changes in the methodologies used at December 31, 2022 and 2021: • Short-term investments: Shares of a money market portfolio valued at amortized cost, which approximates fair value. • Common collective trusts: These investments are public investment securities valued using the NAV provided by a third party investment advisor. The NAV is quoted on a private market that is not active; however, the unit price is based on underlying investments which are traded on an active market. We anticipate contributions to the plan in 2023 to approximate net contribution costs. Estimated future benefit payments are as follows for the next ten years: Estimated Benefit Payments 2023 $ 800 2024 564 2025 669 2026 713 2027 546 2028 - 2032 2,557 Directors Plan Pursuant to the terms of the Directors Plan, our directors are required to invest at least 25% of their board fees in our common stock. These stock investments can be made either through deferred fees or through the purchase of shares through the Dividend Reinvestment Plan. Deferred fees, under the Directors Plan, are converted on a quarterly basis into stock units of our common stock based on the fair value of a share of our common stock as of the relevant valuation date. Stock units credited to a participant’s account are eligible for stock and cash dividends as declared. Dividend Reinvestment Plan shares are purchased pursuant to the Dividend Reinvestment Plan. Distribution of deferred fees from the Directors Plan occurs when the participant retires from the Board of Directors or upon the occurrence of certain other events. The participant is eligible to receive a distribution in the form of shares of our common stock of all of the stock units that are then in his or her account, and any unconverted cash will be converted to and rounded up to whole shares of stock and distributed, as well. The Directors Plan does not allow for cash settlement, and therefore, such share-based payment awards qualify for classification as equity. We may use authorized but unissued shares or purchase shares of common stock on the open market to meet our obligations under the Directors Plan. We maintain the Rabbi Trust to fund the Directors Plan. The Rabbi Trust is an irrevocable grantor trust to which we may contribute assets for the limited purpose of funding a nonqualified deferred compensation plan. Although we may not use the assets of the Rabbi Trust for any purpose other than meeting our obligations under the Directors Plan, the assets of the Rabbi Trust remain subject to the claims of our creditors and are included in the consolidated financial statements. We may contribute cash or common stock to the Rabbi Trust from time to time for the sole purpose of funding the Directors Plan. The Rabbi Trust will use any cash that we contribute to purchase shares of our common stock on the open market. Shares held in the Rabbi Trust are included in the calculation of earnings per share. The components of shares eligible to be issued under the Directors Plan were as follows as of December 31: 2022 2021 Eligible Market Eligible Market Unissued 52,961 $ 1,245 83,710 $ 2,135 Shares held in Rabbi Trust 154,879 3,640 105,654 2,694 Total 207,840 $ 4,885 189,364 $ 4,829 Cash Incentive Plans Executive Cash Incentive Plan We provide an executive cash incentive plan, which provides separate potential payouts for Isabella Bank's CEO, President, and CFO based on achievement of personal and corporate goals. The potential payouts under the plan range from 20% to 30% of the employee's annual salary. Expenses related to this plan for 2022, 2021, and 2020 were $252, $253, and $165 respectively. Employee Cash Incentive Plan We provide cash incentive plans to reward employees above and beyond their base salaries when our performance and operating profitability exceed established annual targets. Incentives are also awarded for achievement of personal performance goals. Expenses related to this plan for 2022, 2021 and 2020 were $1,072, $1,063, and $1,101, respectively. Restricted Stock Plan Under the RSP, an equity based bonus plan, we may award restricted stock bonuses to eligible employees on an annual basis that are not fully transferable or vested until certain conditions are met. Currently, the eligible employees are the Bank's CEO, President and CFO. The RSP authorizes the issuance of unvested restricted stock to an eligible employee with a maximum award ranging from 25% to 40% of the employee’s annual salary, on a calendar year basis. The employee must also satisfy the annual performance targets and measures established by the Board of Directors. If these grant conditions are not satisfied, then the award of restricted shares will lapse or be adjusted appropriately, at the discretion of the Board of Directors. All Grant Agreements contain vesting conditions and clawback provisions. A summary of changes in nonvested restricted stock awards follows for the years ended December 31: 2022 2021 Number Fair Number Fair Balance, January 1 20,123 $ 418 4,658 $ 82 Granted 6,949 174 15,465 336 Vested — — — — Forfeited — — — — Balance, December 31 27,072 $ 592 20,123 $ 418 Compensation expense related to the RSP for 2022, 2021, 2020 and was $147, $86, and $14 respectively. As of December 31, 2022, there was $346 of total remaining unrecognized compensation expense related to nonvested restricted stock awards granted under the RSP. The remaining expense is expected to be recognized over a weighted-average service period of 2.40 years. Other Employee Benefit Plans We maintain nonqualified defined contribution retirement plans to provide supplemental retirement benefits to specified participants. Expenses related to these programs for 2022, 2021 and 2020 were $251, $352, and $373, respectively. Expenses are recognized over the participants’ expected years of service. We maintain a self-funded medical plan under which we are responsible for the first $100 per year of claims made by a covered family. Expenses are accrued based on estimates of the aggregate liability for claims incurred and our experience. Expenses were $3,026 in 2022, $3,297 in 2021 and $1,868 in 2020. |
Revenue (Notes)
Revenue (Notes) | 12 Months Ended |
Dec. 31, 2022 | |
Revenue from Contract with Customer [Abstract] | |
Revenue from Contract with Customer [Text Block] | Revenue Our revenue is comprised primarily of interest income, service charges and fees, gains on the sale of loans and AFS securities, earnings on corporate owned life insurance policies, and other noninterest income. Other noninterest income is typically service and performance driven in nature and comprised primarily of investment and trust advisory fees. We recognize revenue, excluding interest income, in accordance with ASC 606, Revenue From Contracts with Customers. Revenue is recognized when our performance obligation has been satisfied according to our contractual obligation. We record receivables when revenue is unpaid and collectability is reasonably assured. Accounts receivable balances primarily represent amounts due from customers for which revenue has been recognized. Accounts receivable balances are recorded in the consolidated balance sheets in accrued interest receivable and other assets. For the years ended December 31, 2022, 2021 and 2020, we satisfied our performance obligations pursuant to contracts with customers. As a result, we have not recorded any contract assets or liabilities. We estimate no returns or allowances for the years ended December 31, 2022, 2021 and 2020. Our contracts with customers define our performance obligations with clearly established pricing which did not require us to allocate or disaggregate revenue by performance obligation. A summary of revenue recognized for each major category of contracts with customers, subject to ASC 606, is as follows for the years ended December 31: 2022 2021 2020 Debit card income $ 3,783 $ 3,623 $ 2,961 Trust service fees 2,622 2,707 2,294 Investment advisory fees 383 364 284 Service charges and fees related to deposit accounts 345 312 290 A significant portion of our revenue consists of interest income which is not subject to the requirements set forth in ASC 606. |
Disaggregation of Revenue [Table Text Block] | A summary of revenue recognized for each major category of contracts with customers, subject to ASC 606, is as follows for the years ended December 31: 2022 2021 2020 Debit card income $ 3,783 $ 3,623 $ 2,961 Trust service fees 2,622 2,707 2,294 Investment advisory fees 383 364 284 Service charges and fees related to deposit accounts 345 312 290 |
Other Noninterest Expenses
Other Noninterest Expenses | 12 Months Ended |
Dec. 31, 2022 | |
Other Income and Expenses [Abstract] | |
Other Noninterest Expenses | Other Noninterest Expenses A summary of expenses included in other noninterest expenses is as follows for the years ended December 31: 2022 2021 2020 Audit, consulting, and legal fees $ 2,358 $ 2,066 $ 1,836 ATM and debit card fees 1,909 1,810 1,441 Marketing costs 1,056 939 877 Loan underwriting fees 1,004 849 825 Donations and community relations 923 705 723 Memberships and subscriptions 876 877 740 Director fees 790 703 695 FDIC insurance premiums 537 690 612 All other 2,783 2,183 2,725 Total other noninterest expenses $ 12,236 $ 10,822 $ 10,474 |
Federal Income Taxes
Federal Income Taxes | 12 Months Ended |
Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
Federal Income Taxes | Federal Income Taxes Components of the consolidated provision for federal income taxes are summarized as follows for the years ended December 31: 2022 2021 2020 Currently payable $ 4,593 $ 4,371 $ 1,263 Deferred expense (benefit) 13 (523) (276) Income tax expense $ 4,606 $ 3,848 $ 987 The reconciliation of the provision for federal income taxes and the amount computed at the federal statutory tax rate of 21% of income before federal income tax expense is as follows for the year ended December 31: 2022 2021 2020 Income taxes at statutory rate $ 5,637 $ 4,903 $ 2,493 Effect of nontaxable income Interest income on tax exempt municipal securities (587) (643) (802) Earnings on corporate owned life insurance policies (197) (225) (346) Other 329 312 288 Total effect of nontaxable income (455) (556) (860) Effect of nondeductible expenses 45 46 68 Effect of tax credits (621) (617) (830) Unrecognized deferred tax benefit on joint venture investment — 72 116 Federal income tax expense $ 4,606 $ 3,848 $ 987 The losses recognized for December 31, 2021 and 2020 related to our joint venture investment in CSS, which was sold during the fourth quarter of 2020. The sale of this investment resulted in a capital loss carryforward that is unlikely to be recognized in the foreseeable future. As such, we did not recognize a deferred tax asset as of December 31, 2022, 2021 and 2020 related to our investment and capital loss in CSS. Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for federal income tax purposes. Significant components of our deferred tax assets and liabilities, measured at the 21% statutory rate, included in other assets and other liabilities on our consolidated balance sheets, are summarized as follows as of December 31: 2022 2021 Deferred tax assets Allowance for loan losses $ 1,848 $ 1,635 Deferred compensation 1,648 1,553 Employee benefit plans 82 98 Core deposit premium and acquisition expenses 764 759 Net unrealized losses on AFS securities 9,296 — Net unrecognized actuarial losses on pension plan 363 536 Life insurance death benefit payable 497 497 Other 789 867 Total deferred tax assets 15,287 5,945 Deferred tax liabilities Prepaid pension cost 297 309 Premises and equipment 1,590 1,729 Accretion on securities 166 61 Core deposit premium and acquisition expenses 984 947 Net unrealized gains on AFS securities — 1,018 Other 1,075 834 Total deferred tax liabilities 4,112 4,898 Net deferred tax assets (liabilities) $ 11,175 $ 1,047 While we are subject to U.S. federal income tax, we are no longer subject to examination by taxing authorities for years before 2019. There are no material uncertain tax positions requiring recognition in our consolidated financial statements. We do not expect the total amount of unrecognized tax benefits to significantly increase in the next twelve months. We recognize interest and/or penalties related to income tax matters in income tax expense. We do not have any amounts accrued for interest and penalties at December 31, 2022 and 2021 and we are not aware of any claims for such amounts by federal income tax authorities. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income (Loss) | 12 Months Ended |
Dec. 31, 2022 | |
Equity [Abstract] | |
Accumulated Other Comprehensive Income (Loss) | Accumulated Other Comprehensive Income (Loss) AOCI includes net income as well as unrealized gains and losses, net of tax, on AFS securities and derivative instruments, as well as changes in the funded status of our defined benefit pension plan. Unrealized gains and losses and changes in the funded status of the pension plan, net of tax, are excluded from net income, and are reflected as a direct charge or credit to shareholders’ equity. Comprehensive income (loss) and the related components are disclosed in the consolidated statements of comprehensive income. The following table provides a roll-forward of the changes in AOCI by component for the years ended December 31, 2020, 2021 and 2022 (net of tax): Unrealized Unrealized Change in Unrecognized Pension Cost on Defined Total Balance, January 1, 2020 $ 4,612 $ 54 $ (2,695) $ 1,971 OCI before reclassifications 7,474 (121) (238) 7,115 Amounts reclassified from AOCI (71) — 176 105 Subtotal 7,403 (121) (62) 7,220 Tax effect (1,530) 25 12 (1,493) OCI, net of tax 5,873 (96) (50) 5,727 Balance, December 31, 2020 10,485 (42) (2,745) 7,698 OCI before reclassifications (8,371) 53 955 (7,363) Amounts reclassified from AOCI — — (31) (31) Subtotal (8,371) 53 924 (7,394) Tax effect 1,759 (11) (193) 1,555 OCI, net of tax (6,612) 42 731 (5,839) Balance, December 31, 2021 3,873 — (2,014) 1,859 OCI before reclassifications (50,015) — 762 (49,253) Amounts reclassified from AOCI — — 59 59 Subtotal (50,015) — 821 (49,194) Tax effect 10,314 — (173) 10,141 OCI, net of tax (39,701) — 648 (39,053) Balance, December 31, 2022 $ (35,828) $ — $ (1,366) $ (37,194) Included in OCI are changes in unrealized gains and losses related to auction rate money market preferred stocks. Auction rate money market preferred stocks, for federal income tax purposes, have no deferred federal income taxes related to unrealized gains or losses given the nature of the investments. A summary of the components of unrealized gains on AFS securities included in OCI follows for the years ended December 31: 2022 2021 2020 Auction Rate Money Market Preferred Stocks All Other AFS Securities Total Auction Rate Money Market Preferred Stocks All Other AFS Securities Total Auction Rate Money Market Preferred Stocks All Other AFS Securities Total Unrealized gains (losses) arising during the period $ (900) $ (49,115) $ (50,015) $ 5 $ (8,376) $ (8,371) $ 118 $ 7,356 $ 7,474 Reclassification adjustment for net (gains) losses included in net income — — — — — — — (71) (71) Net unrealized gains (losses) (900) (49,115) (50,015) 5 (8,376) (8,371) 118 7,285 7,403 Tax effect — 10,314 10,314 — 1,759 1,759 — (1,530) (1,530) Unrealized gains (losses), net of tax $ (900) $ (38,801) $ (39,701) $ 5 $ (6,617) $ (6,612) $ 118 $ 5,755 $ 5,873 The following table details reclassification adjustments and the related affected line items in our consolidated statements of income for the years ended December 31: Details about AOCI components Amount Affected Line Item in the 2022 2021 2020 Unrealized gains (losses) on AFS securities $ — $ — $ 71 Net gains on sale of AFS securities — — 15 Federal income tax expense $ — $ — $ 56 Net income Change in unrecognized pension cost on defined benefit pension plan $ 59 $ (31) $ 176 Other noninterest expenses 12 (7) 37 Federal income tax (benefit) expense $ 47 $ (24) $ 139 Net income |
Fair Value
Fair Value | 12 Months Ended |
Dec. 31, 2022 | |
Fair Value Disclosures [Abstract] | |
Fair Value | Fair Value Under fair value measurement and disclosure authoritative guidance, we group assets and liabilities measured at fair value into three levels, based on the markets in which the assets and liabilities are traded, and the reliability of the assumptions used to determine fair value, based on the prioritization of inputs in the valuation techniques. These levels are: Level 1: Valuation is based upon quoted prices for identical instruments traded in active markets. Level 2: Valuation is based upon quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active and model based valuation techniques for which all significant assumptions are observable in the market. Level 3: Valuation is generated from model based techniques that use at least one significant assumption not observable in the market. These unobservable assumptions reflect estimates of assumptions that market participants would use in pricing the asset or liability. The asset’s or liability’s fair value measurement level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. Valuation techniques maximize the use of observable inputs and minimize the use of unobservable inputs. Transfers between measurement levels are recognized at the end of reporting periods. Fair value measurement requires the use of an exit price notion which may differ from entrance pricing. Generally, we believe our assets and liabilities classified as Level 1 or Level 2 approximate an exit price notion. Following is a description of the valuation methodologies, key inputs, and an indication of the level of the fair value hierarchy in which the assets or liabilities are classified. AFS securities: AFS securities are recorded at fair value on a recurring basis. Level 1 fair value measurement is based upon quoted prices for identical instruments. Level 2 fair value measurement is based upon quoted prices for similar instruments. If quoted prices are not available, fair values are measured using independent pricing models or other model based valuation techniques such as the present value of future cash flows, adjusted for the security’s credit rating, prepayment assumptions and other factors such as credit loss and liquidity assumptions. The values for Level 1 and Level 2 investment securities are generally obtained from an independent third party. On a quarterly basis, we compare the values provided to alternative pricing sources. Loans: We do not record loans at fair value on a recurring basis. However, some loans are classified as impaired and a specific allowance for loan losses may be established. Loans for which it is probable that payment of interest and principal will be significantly different than the contractual terms of the original loan agreement are considered impaired. Once a loan is identified as impaired, we measure the estimated impairment. The fair value of impaired loans is estimated using one of several methods, including the present value of expected future cash flows discounted at the loan’s effective interest rate, or the fair value of the collateral, less costs to sell, if the loan is collateral dependent. Those impaired loans not requiring an allowance represent loans for which the fair value of the expected repayments or collateral exceed the recorded investments in such loans. We review the net realizable values of the underlying collateral for collateral dependent impaired loans on at least a quarterly basis for all loan types. To determine the collateral value, we utilize independent appraisals, broker price opinions, or internal evaluations. We review these valuations to determine whether an additional discount should be applied given the age of market information that may have been considered as well as other factors such as costs to sell an asset if it is determined that the collateral will be liquidated in connection with the ultimate settlement of the loan. We use these valuations to determine if any specific reserves or charge-offs are necessary. We may obtain new valuations in certain circumstances, including when there has been significant deterioration in the condition of the collateral, if the foreclosure process has begun, or if the existing valuation is deemed to be outdated. The following tables list the quantitative fair value information about impaired loans as of: December 31, 2022 Valuation Technique Fair Value Unobservable Input Actual Range Weighted Average Discount applied to collateral: Real Estate 20% - 30% 24% Equipment 25% - 35% 31% Discounted value $17,143 Cash crop inventory 40% 40% Livestock 30% 30% Accounts receivable 25% 27% Furniture, fixtures & equipment 45% 45% December 31, 2021 Valuation Technique Fair Value Unobservable Input Actual Range Weighted Average Discount applied to collateral: Real Estate 20% - 30% 23% Equipment 20% - 35% 28% Discounted value $18,812 Cash crop inventory 40% 40% Livestock 30% 30% Accounts receivable 50% 50% Liquor license 75% 75% Collateral discount rates may have ranges to accommodate differences in the age of the independent appraisal, broker price opinion, or internal evaluation. OMSR: OMSR (which are included in other assets) are subject to impairment testing. To test for impairment, we utilize a discounted cash flow analysis using interest rates and prepayment speed assumptions currently quoted for comparable instruments and discount rates. If the valuation model reflects a value less than the carrying value, OMSR are adjusted to fair value through a valuation allowance as determined by the model. As such, we classify OMSR subject to nonrecurring fair value adjustments as Level 2. The preceding methods described may produce a fair value calculation that may not be indicative of net realizable value or reflective of future fair values. Although we believe our valuation methods are appropriate and consistent with other market participants, the use of different methodologies or assumptions to determine the fair value of certain financial instruments could result in a different fair value measurement. Estimated Fair Values of Financial Instruments Not Recorded at Fair Value in their Entirety on a Recurring Basis Disclosure of the estimated fair values of financial instruments, which differ from carrying values, often requires the use of estimates. In cases where quoted market values in an active market are not available, we use present value techniques and other valuation methods to estimate the fair values of our financial instruments. These valuation methods require considerable judgment and the resulting estimates of fair value can be significantly affected by the assumptions made and methods used. The carrying amount and estimated fair value of financial instruments not recorded at fair value in their entirety on a recurring basis were as follows as of December 31: 2022 Carrying Estimated Level 1 Level 2 Level 3 ASSETS Cash and cash equivalents $ 38,924 $ 38,924 $ 38,924 $ — $ — Mortgage loans AFS 379 395 — 395 — Gross loans 1,264,173 1,225,669 — — 1,225,669 Less allowance for loan and lease losses 9,850 9,850 — — 9,850 Net loans 1,254,323 1,215,819 — — 1,215,819 Accrued interest receivable 7,472 7,472 7,472 — — Equity securities without readily determinable fair values (1) 15,746 N/A — — — OMSR 2,559 3,174 — 3,174 — LIABILITIES Deposits without stated maturities 1,492,235 1,492,235 1,492,235 — — Deposits with stated maturities 252,040 240,964 — 240,964 — Federal funds purchased and repurchase agreements 57,771 57,581 — 57,581 — Subordinated debt, net of unamortized issuance costs 29,245 26,365 — 26,365 — Accrued interest payable 255 255 255 — — 2021 Carrying Estimated Level 1 Level 2 Level 3 ASSETS Cash and cash equivalents $ 105,330 $ 105,330 $ 105,330 $ — $ — Mortgage loans AFS 1,735 1,797 — 1,797 — Gross loans 1,301,037 1,296,841 — — 1,296,841 Less allowance for loan and lease losses 9,103 9,103 — — 9,103 Net loans 1,291,934 1,287,738 — — 1,287,738 Accrued interest receivable 5,804 5,804 5,804 — — Equity securities without readily determinable fair values (1) 17,383 N/A — — — OMSR 2,124 2,753 — 2,753 — LIABILITIES Deposits without stated maturities 1,409,577 1,409,577 1,409,577 — — Deposits with stated maturities 300,762 301,216 — 301,216 — Federal funds purchased and repurchase agreements 50,162 50,153 — 50,153 — FHLB advances 20,000 20,120 — 20,120 — Subordinated debt, net of unamortized issuance costs 29,158 27,435 — 27,435 — Accrued interest payable 251 251 251 — — (1) Due to the characteristics of equity securities without readily determinable fair values, they are not disclosed under a specific fair value hierarchy. When an impairment or write-down related to these securities is recorded, such amount would be classified as a nonrecurring Level 3 fair value adjustment. Financial Instruments Recorded at Fair Value The table below presents the recorded amount of assets and liabilities measured at fair value on December 31: 2022 2021 Total Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Recurring items AFS securities U.S. Treasury $ 208,701 $ — $ 208,701 $ — $ 209,703 $ — $ 209,703 $ — States and political subdivisions 117,512 — 117,512 — 121,205 — 121,205 — Auction rate money market preferred 2,342 — 2,342 — 3,242 — 3,242 — Mortgage-backed securities 39,070 — 39,070 — 56,148 — 56,148 — Collateralized mortgage obligations 205,728 — 205,728 — 92,301 — 92,301 — Corporate 7,128 — 7,128 — 8,002 — 8,002 — Total AFS securities 580,481 — 580,481 — 490,601 — 490,601 — Nonrecurring items Impaired loans (net of the ALLL) 17,143 — — 17,143 18,812 — — 18,812 Foreclosed assets 439 — — 439 211 — — 211 Total $ 598,063 $ — $ 580,481 $ 17,582 $ 509,624 $ — $ 490,601 $ 19,023 Percent of assets and liabilities measured at fair value 0.00 % 97.06 % 2.94 % 0.00 % 96.27 % 3.73 % We recorded losses of $6 and $0 through earnings related fair value changes in foreclosed assets for the years ended December 31, 2022 and 2021. We had no other assets or liabilities recorded at fair value with changes in fair value recognized through earnings, on a recurring basis or nonrecurring basis, as of December 31, 2022 and 2021. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2022 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party Transactions In the ordinary course of business, we grant loans to principal officers and directors and their affiliates (including their families and companies in which they have 10% or more ownership). Annual activity consisted of the following for the years ended December 31: 2022 2021 Balance, January 1 $ 22,558 $ 2,977 New loans 1,829 43,264 Repayments (3,424) (23,683) Balance, December 31 $ 20,963 $ 22,558 Total deposits of these principal officers and directors and their affiliates amounted to $12,317 and $15,268 at December 31, 2022 and 2021, respectively. From time to time, we make charitable donations to The Isabella Bank Foundation (the “Foundation”), which is a non-controlled nonprofit organization formed for the purpose of distributing charitable donations to recipient organizations generally located in the communities we serve. Our donations are recognized as expense when paid to the Foundation. The assets and transactions of the Foundation are not included in our consolidated financial statements. Assets of the Foundation include cash and cash equivalents, certificates of deposit, and shares of Isabella Bank Corporation common stock. The Foundation owned 20,000 shares of our common stock as of December 31, 2022 and 2021. Such shares are included in the computation of dividends and earnings per share. The following table displays total assets of, and our donations to, the Foundation as of, and for the years ended December 31: 2022 2021 2020 Total assets $ 1,385 $ 1,511 $ 1,286 Donations $ 50 $ 50 $ — |
Operating Segments
Operating Segments | 12 Months Ended |
Dec. 31, 2022 | |
Segment Reporting [Abstract] | |
Operating Segments | Operating SegmentsOur reportable segments are based on legal entities that account for at least 10% of net operating results. The operations of the Bank as of December 31, 2022, 2021, and 2020 represent approximately 90% or more of our consolidated total assets and operating results. As such, no additional segment reporting is presented. |
Parent Company Only Financial I
Parent Company Only Financial Information | 12 Months Ended |
Dec. 31, 2022 | |
Condensed Financial Information Disclosure [Abstract] | |
Parent Company Only Financial Information | Parent Company Only Financial Information Condensed Balance Sheets December 31 2022 2021 ASSETS Cash on deposit at the Bank $ 8,525 $ 11,535 Investments in subsidiaries 158,125 178,395 Premises and equipment 1,171 1,482 Other assets 47,922 48,923 TOTAL ASSETS $ 215,743 $ 240,335 LIABILITIES AND SHAREHOLDERS’ EQUITY Subordinated debt, net of unamortized issuance costs $ 29,245 $ 29,158 Other liabilities 288 129 Shareholders' equity 186,210 211,048 TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY $ 215,743 $ 240,335 Condensed Statements of Income Year Ended December 31 2022 2021 2020 Income Dividends from subsidiaries $ 6,000 $ 3,600 $ 9,300 Interest income 15 12 1 Net income on CSS joint venture — — 577 Other income 14 17 — Total income 6,029 3,629 9,878 Expenses Interest expense 1,065 615 5 Occupancy and equipment 67 67 61 Audit, consulting, and legal fees 522 590 573 Director fees 417 352 356 Other 1,172 1,145 1,167 Total expenses 3,243 2,769 2,162 Income before income tax benefit and equity in undistributed earnings of subsidiaries 2,786 860 7,716 Federal income tax benefit 670 500 216 Income before equity in undistributed earnings of subsidiaries 3,456 1,360 7,932 Undistributed earnings of subsidiaries 18,782 18,139 2,953 Net income $ 22,238 $ 19,499 $ 10,885 Condensed Statements of Cash Flows Year Ended December 31 2022 2021 2020 Operating activities Net income $ 22,238 $ 19,499 $ 10,885 Adjustments to reconcile net income to cash provided by operations Undistributed earnings of subsidiaries (18,782) (18,139) (2,953) Undistributed earnings of equity securities without readily determinable fair values — — (394) Loss on sale of joint venture investment — — 394 Share-based payment awards under the Directors Plan 463 433 413 Share-based payment awards under the RSP 147 86 14 Amortization of subordinated debt issuance costs 87 52 — Depreciation 50 50 47 Deferred income tax expense (benefit) (133) (267) 351 Changes in operating assets and liabilities which provided (used) cash Other assets 1,383 (304) 183 Other liabilities 160 70 40 Net cash provided by (used in) operating activities 5,613 1,480 8,980 Investing activities Purchase of equity investments (250) — — Sale of joint venture investment — — 1,000 Net sales (purchases) of premises and equipment 260 (2) (37) Net cash provided by (used in) investing activities 10 (2) 963 Financing activities Issuance of subordinated debt, net of unamortized issuance costs — 29,106 — Cash dividends paid on common stock (8,082) (8,367) (8,524) Proceeds from the issuance of common stock 1,762 1,593 4,185 Common stock repurchased (1,124) (13,758) (2,702) Common stock purchased for deferred compensation obligations (1,189) (1,187) (1,592) Net cash provided by (used in) financing activities (8,633) 7,387 (8,633) Increase (decrease) in cash and cash equivalents (3,010) 8,865 1,310 Cash and cash equivalents at beginning of period 11,535 2,670 1,360 Cash and cash equivalents at end of period $ 8,525 $ 11,535 $ 2,670 |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2022 | |
Subsequent Events [Abstract] | |
Subsequent Events [Text Block] | Subsequent Events In June 2016, the FASB issued ASU 2016-13 and updated the measurement for credit losses for AFS debt securities and assets measured at amortized cost, which include loans and any other financial assets with the contractual right to receive cash. The new approach requires the use of an expected credit loss model. The new CECL guidance was effective January 1, 2023 and we have fully adopted the new guidance as of that date. Based on portfolio characteristics and economic conditions and expectations as of January 1, 2023, we recorded a combined increase to the ACL and reserve for unfunded commitments on January 1, 2023 of approximately $3,000 upon the adoption of ASU 2016-13. |
Nature of Operations and Summ_2
Nature of Operations and Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2022 | |
Accounting Policies [Abstract] | |
BASIS OF PRESENTATION AND CONSOLIDATION | BASIS OF PRESENTATION AND CONSOLIDATION: The consolidated financial statements include the accounts of Isabella Bank Corporation, a financial services holding company, and its wholly owned subsidiary, Isabella Bank. All intercompany balances and accounts have been eliminated in consolidation. |
USE OF ESTIMATES | USE OF ESTIMATES: In preparing consolidated financial statements in conformity with accounting principles generally accepted in the United States of America, we make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the consolidated balance sheet and reported amounts of revenues and expenses during the reporting year. Actual results could differ from those estimates. Material estimates that are particularly susceptible to significant change in the near term relate to the determination of the ALLL, the fair value of AFS investment securities, and the valuation of goodwill and other intangible assets. |
FAIR VALUE MEASUREMENTS | FAIR VALUE MEASUREMENTS : Fair value refers to the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants in the market in which the reporting entity transacts such sales or transfers based on the assumptions market participants would use when pricing an asset or liability. Assumptions are developed based on prioritizing information within a fair value hierarchy that gives the highest priority to quoted prices in active markets and the lowest priority to unobservable data, such as the reporting entity’s own data. We may choose to measure eligible items at fair value at specified election dates. For assets and liabilities recorded at fair value, it is our policy to maximize the use of observable inputs and minimize the use of unobservable inputs when developing fair value measurements for those financial instruments for which there is an active market. In cases where the market for a financial asset or liability is not active, we include appropriate risk adjustments that market participants would make for nonperformance and liquidity risks when developing fair value measurements. Fair value measurements for assets and liabilities for which limited or no observable market data exists are accordingly based primarily upon estimates, are often calculated based on the economic and competitive environment, the characteristics of the asset or liability and other factors. Therefore, the results cannot be determined with precision and may not be realized in an actual sale or immediate settlement of the asset or liability. Additionally, there may be inherent weaknesses in any calculation technique, and changes in the underlying assumptions used, including discount rates and estimates of future cash flows, could significantly affect the results of current or future values. We utilize fair value measurements to record fair value adjustments to certain assets and liabilities and to determine fair value disclosures. Investment securities AFS and derivative instruments are recorded at fair value on a recurring basis. Additionally, from time to time, we may be required to record other assets and liabilities at fair value on a nonrecurring basis, such as mortgage loans AFS, impaired loans, foreclosed assets, OMSR, goodwill, and certain other assets and liabilities. These nonrecurring fair value adjustments typically involve the application of lower of cost or market accounting or write downs of individual assets. Fair Value Hierarchy Under fair value measurement and disclosure authoritative guidance, we group assets and liabilities measured at fair value into three levels, based on the markets in which the assets and liabilities are traded, and the reliability of the assumptions used to determine fair value, based on the prioritization of inputs in the valuation techniques. These levels are: Level 1: Valuation is based upon quoted prices for identical instruments traded in active markets. Level 2: Valuation is based upon quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active and model based valuation techniques for which all significant assumptions are observable in the market. Level 3: Valuation is generated from model based techniques that use at least one significant assumption not observable in the market. These unobservable assumptions reflect estimates of assumptions that market participants would use in pricing the asset or liability. The asset’s or liability’s fair value measurement level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. Valuation techniques maximize the use of observable inputs and minimize the use of unobservable inputs. Transfers between measurement levels are recognized at the end of reporting periods. For further discussion of fair value considerations, refer to “Note 17 – Fair Value.” Under fair value measurement and disclosure authoritative guidance, we group assets and liabilities measured at fair value into three levels, based on the markets in which the assets and liabilities are traded, and the reliability of the assumptions used to determine fair value, based on the prioritization of inputs in the valuation techniques. These levels are: Level 1: Valuation is based upon quoted prices for identical instruments traded in active markets. Level 2: Valuation is based upon quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active and model based valuation techniques for which all significant assumptions are observable in the market. Level 3: Valuation is generated from model based techniques that use at least one significant assumption not observable in the market. These unobservable assumptions reflect estimates of assumptions that market participants would use in pricing the asset or liability. The asset’s or liability’s fair value measurement level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. Valuation techniques maximize the use of observable inputs and minimize the use of unobservable inputs. Transfers between measurement levels are recognized at the end of reporting periods. Fair value measurement requires the use of an exit price notion which may differ from entrance pricing. Generally, we believe our assets and liabilities classified as Level 1 or Level 2 approximate an exit price notion. |
SIGNIFICANT GROUP CONCENTRATIONS OF CREDIT RISK | SIGNIFICANT GROUP CONCENTRATIONS OF CREDIT RISK : Most of our activities are conducted with customers located within the central Michigan area. A significant amount of our outstanding loans are secured by commercial and residential real estate. Other than these types of loans, there is no significant concentration to any other industry or any one customer. Internally assigned credit risk ratings are reviewed, at a minimum, when loans are renewed or when management has knowledge of improvements or deterioration of the credit quality of individual credits. Descriptions of the internally assigned credit risk ratings for commercial and agricultural loans are as follows: 1. EXCELLENT – Substantially Risk Free Credit has strong financial condition and solid earnings history, characterized by: • High liquidity, strong cash flow, low leverage. • Unquestioned ability to meet all obligations when due. • Experienced management, with management succession in place. • Secured by cash. 2. HIGH QUALITY – Limited Risk Credit with sound financial condition and a positive trend in earnings supplemented by: • Favorable liquidity and leverage ratios. • Ability to meet all obligations when due. • Management with successful track record. • Steady and satisfactory earnings history. • If loan is secured, collateral is of high quality and readily marketable. • Access to alternative financing. • Well defined primary and secondary source of repayment. • If supported by guaranty, the financial strength and liquidity of the guarantor(s) are clearly evident. 3. HIGH SATISFACTORY – Reasonable Risk Credit with satisfactory financial condition and further characterized by: • Working capital adequate to support operations. • Cash flow sufficient to pay debts as scheduled. • Management experience and depth appear favorable. • Loan performing according to terms. • If loan is secured, collateral is acceptable and loan is fully protected. 4. LOW SATISFACTORY – Acceptable Risk Credit with bankable risks, although some signs of weaknesses are shown: • Would include most start-up businesses. • Occasional instances of trade slowness or repayment delinquency – may have been 10-30 days slow within the past year. • Management’s abilities are apparent yet unproven. • Weakness in primary source of repayment with adequate secondary source of repayment. • Loan structure generally in accordance with policy. • If secured, loan collateral coverage is marginal. To be classified as less than satisfactory, only one of the following criteria must be met. 5. SPECIAL MENTION – Criticized Credit constitutes an undue and unwarranted credit risk but not to the point of justifying a classification of substandard. The credit risk may be relatively minor yet constitutes an unwarranted risk in light of the circumstances surrounding a specific loan: • Downward trend in sales, profit levels, and margins. • Impaired working capital position. • Cash flow is strained in order to meet debt repayment. • Loan delinquency (30-60 days) and overdrafts may occur. • Shrinking equity cushion. • Diminishing primary source of repayment and questionable secondary source. • Management abilities are questionable. • Weak industry conditions. • Litigation pending against the borrower. • Loan may need to be restructured to improve collateral position or reduce payments. • Collateral or guaranty offers limited protection. • Negative debt service coverage, however the credit is well collateralized and payments are current. 6. SUBSTANDARD – Classified Credit is inadequately protected by the current net worth and paying capacity of the borrower or of the collateral pledged. There is a distinct possibility we will implement collection procedures if the loan deficiencies are not corrected. Any commercial loan placed in nonaccrual status will be rated “7” or worse. In addition, the following characteristics may apply: • Sustained losses have severely eroded the equity and cash flow. • Deteriorating liquidity. • Serious management problems or internal fraud. • Original repayment terms liberalized. • Likelihood of bankruptcy. • Inability to access other funding sources. • Reliance on secondary source of repayment. • Litigation filed against borrower. • Interest non-accrual may be warranted. • Collateral provides little or no value. • Requires excessive attention of the loan officer. • Borrower is uncooperative with loan officer. 7. VULNERABLE – Classified Credit is considered “Substandard” and warrants placing in nonaccrual status. Risk of loss is being evaluated and exit strategy options are under review. Other characteristics that may apply: • Insufficient cash flow to service debt. • Minimal or no payments being received. • Limited options available to avoid the collection process. • Transition status, expect action will take place to collect loan without immediate progress being made. 8. DOUBTFUL – Workout Credit has all the weaknesses inherent in a “Substandard” loan with the added characteristic that collection and/or liquidation is pending. The possibility of a loss is extremely high, but its classification as a loss is deferred until liquidation procedures are completed, or reasonably estimable. Other characteristics that may apply: • Normal operations are severely diminished or have ceased. • Seriously impaired cash flow. • Original repayment terms materially altered. • Secondary source of repayment is inadequate. • Survivability as a “going concern” is impossible. • Collection process has begun. • Bankruptcy petition has been filed. • Judgments have been filed. • Portion of the loan balance has been charged-off. 9. LOSS – Charge-off Credit is considered uncollectible and of such little value that their continuance as bankable assets is not warranted. This classification is for charged-off loans but does not mean that the asset has absolutely no recovery or salvage value. These loans are further characterized by: • Liquidation or reorganization under Bankruptcy, with poor prospects of collection. • Fraudulently overstated assets and/or earnings. • Collateral has marginal or no value. • Debtor cannot be located. • Over 120 days delinquent. |
CASH AND CASH EQUIVALENTS | CASH AND CASH EQUIVALENTS: For purposes of the consolidated statements of cash flows, cash and cash equivalents include cash and balances due from banks, federal funds sold, and other deposit accounts. Generally, federal funds sold are for a one day period. We maintain deposit accounts in various financial institutions which generally exceed federally insured limits or are not insured. We do not believe we are exposed to any significant interest, credit or other financial risk as a result of these deposits. |
AFS SECURITIES | AFS SECURITIES: Purchases of investment securities are generally classified as AFS. However, we may elect to classify securities as either held to maturity or trading. Securities classified as AFS debt securities are recorded at fair value, with unrealized gains and losses, net of the effect of deferred income taxes, excluded from earnings and reported in other comprehensive income. Included in AFS securities are auction rate money market preferred securities. These investments, for federal income tax purposes, have no federal income tax impact given the nature of the investments. Auction rate money market preferred securities are recorded at fair value, with unrealized gains and losses excluded from earnings and reported in other comprehensive income. Purchase premiums and discounts are recognized in interest income using the interest method over the term of the securities. Realized gains and losses on the sale of AFS securities are determined using the specific identification method. AFS securities are reviewed quarterly for possible OTTI. In determining whether an OTTI exists for debt securities, we assert that: (a) we do not have the intent to sell the security; and (b) it is more likely than not we will not have to sell the security before recovery of its cost basis. If these conditions are not met, we recognize an OTTI charge through earnings for the difference between the debt security’s amortized cost basis and its fair value, and such amount is included in noninterest income. For debt securities that do not meet the above criteria, and we do not expect to recover the security’s amortized cost basis, the security is considered other-than-temporarily impaired. For these debt securities, we separate the total impairment into the credit risk loss component and the amount of the loss related to market and other risk factors. In order to determine the amount of the credit loss for a debt security, we calculate the recovery value by performing a discounted cash flow analysis based on the current cash flows and future cash flows we expect to recover. The amount of the total OTTI related to the credit risk is recognized in earnings and is included in noninterest income. The amount of the total OTTI related to other risk factors is recognized as a component of other comprehensive income. For debt securities that have recognized OTTI through earnings, if through subsequent evaluation there is a significant increase in the cash flow expected, the difference between the amortized cost basis and the cash flows expected to be collected is accreted as interest income. As of December 31, 2022 and 2021, we conducted an analysis to determine whether any AFS securities currently in an unrealized loss position should be identified as other-than-temporarily impaired. Such analyses considered, among other factors, the following criteria: • Has the value of the investment declined more than what is deemed to be reasonable based on a risk and maturity adjusted discount rate? • Is the investment credit rating below investment grade? • Is it probable the issuer will be unable to pay the amount when due? • Is it more likely than not that we will have to sell the security before recovery of its cost basis? • Has the duration of the investment been extended? |
LOANS | LOANS: Loans that we have the intent and ability to hold for the foreseeable future or until maturity or payoff are reported at their outstanding principal balance adjusted for any charge-offs, the ALLL, and any deferred fees or costs. Interest income on loans is accrued over the term of the loan based on the principal amount outstanding. Loan origination fees and certain direct loan origination costs are capitalized and recognized as a component of interest income over the term of the loan using the appropriate yield methods. Commercial and agricultural loans include loans for commercial real estate, commercial operating loans, advances to mortgage brokers, farmland and agricultural production, and loans to states and political subdivisions. Repayment of these loans is dependent upon the successful operation and management of a business. We minimize our risk by limiting the amount of direct credit exposure to any one borrower to $18,000. Borrowers with direct credit needs of more than $18,000 may be serviced through the use of loan participations with other commercial banks. Commercial and agricultural real estate loans commonly require loan-to-value limits of 80% or less. Depending upon the type of loan, past credit history, and current operating results, we may require the borrower to pledge accounts receivable, inventory, property, or equipment. Government agency guarantee may be required. Personal guarantees and/or life insurance beneficiary assignments are generally required from the owners of closely held corporations, partnerships, and sole proprietorships. In addition, we may require annual financial statements, prepare cash flow analyses, and review credit reports.. We entered into a mortgage purchase program in 2016 with a financial institution where we participate in advances to mortgage brokers. The mortgage brokers originate residential mortgage loans with the intent to sell them on the secondary market. We participate in the advance to the mortgage broker, which is secured by the underlying mortgage loan, until it is ultimately sold on the secondary market. As such, the average life of each participated advance is approximately 20-30 days. Funds from the sale of the loan are used to pay off our participation in the advance to the mortgage broker. We classify these advances as commercial loans and include the outstanding balance in commercial loans on our consolidated balance sheets. Under the participation agreement, we currently are not committed to participate. We offer adjustable rate mortgages, construction loans, and fixed rate residential real estate loans which have amortization periods up to a maximum of 30 years. We consider the anticipated direction of interest rates, balance sheet duration, the sensitivity of our balance sheet to changes in interest rates, our liquidity needs, and overall loan demand to determine whether or not to sell fixed rate loans to Freddie Mac. Our lending policies generally limit the maximum loan-to-value ratio on residential real estate loans to 100% of the lower of the appraised value of the property or the purchase price. Private mortgage insurance is typically required on loans with loan-to-value ratios in excess of 80% unless the loan qualifies for government guarantees. Underwriting criteria for residential real estate loans generally include: • Evaluation of the borrower’s ability to make monthly payments. • Evaluation of the value of the property securing the loan. • Ensuring the payment of principal, interest, taxes, and hazard insurance does not exceed 28% of a borrower’s gross income. • Ensuring all debt servicing does not exceed 40% of income. • Verification of acceptable credit reports. • Verification of employment, income, and financial information. Appraisals are performed by independent appraisers and are reviewed for appropriateness. Generally, mortgage loan requests are reviewed by our mortgage loan committee or through a secondary market underwriting system; loans in excess of $1,000 require the approval of our Internal Loan Committee, the Executive Loan Committee, the Board of Directors’ Loan Committee, or the Board of Directors. Consumer loans include secured and unsecured personal loans. Loans are amortized for a period of up to 15 years based on the age and value of the underlying collateral. The underwriting emphasis is on a borrower’s perceived intent and ability to pay rather than collateral value. No consumer loans are sold to the secondary market. |
ALLOWANCE FOR LOAN LOSSES | ALLOWANCE FOR LOAN AND LEASE LOSSES: The ALLL is established as losses are estimated to have occurred through a provision for loan losses charged to earnings. Loan losses are charged against the allowance when we believe the uncollectability of the loan balance is confirmed. Subsequent recoveries, if any, are credited to the allowance. We evaluate the ALLL on a regular basis. Our periodic review of the collectability of loans considers historical experience, the nature and volume of the loan portfolio, adverse situations that may affect the borrower’s ability to repay, estimated value of any underlying collateral and prevailing economic conditions. This evaluation is inherently subjective as it requires estimates that are susceptible to significant revision as more information becomes available. The ALLL consists of specific, general, and unallocated components. The specific component relates to loans that are deemed to be impaired. For such loans that are analyzed for specific allowance allocations, an allowance is established when the discounted cash flows or collateral value, less costs to sell, of the impaired loan is lower than the carrying value of that loan. The general component covers non-impaired loans and is based on historical loss experience adjusted for current conditions. An unallocated component is maintained to cover uncertainties that we believe affect our estimate of probable losses based on qualitative factors. The unallocated component of the allowance reflects the margin of imprecision inherent in the underlying assumptions used in the methodologies for estimating specific and general losses in the portfolio. Loans may be classified as impaired if they meet one or more of the following criteria: 1. There has been a charge-off of its principal balance; 2. The loan has been classified as a TDR; or 3. The loan is in nonaccrual status. Impairment is measured on a loan-by-loan basis by either the present value of expected future cash flows discounted at the loan’s effective interest rate, or the fair value of the collateral, less costs to sell, if the loan is collateral dependent. Large groups of smaller-balance, homogeneous loans are collectively evaluated for impairment. The ALLL is established as losses are estimated to have occurred through a provision for loan losses charged to earnings. Full or partial loan balances are charged against the ALLL when we believe uncollectability is probable. Subsequent recoveries, if any, are credited to the ALLL The ALLL is evaluated on a regular basis for appropriateness. Our periodic review of the collectability of a loan considers historical experience, the nature and volume of the loan portfolio, adverse situations that may affect the borrower’s ability to repay, estimated value of any underlying collateral, and prevailing economic conditions. This evaluation is inherently subjective as it requires estimates that are susceptible to significant revision as more information becomes available. The primary factors behind the determination of the level of the ALLL are specific allocations for impaired loans, historical loss percentages, as well as unallocated components. Specific allocations for impaired loans are primarily determined based on the difference between the loan’s outstanding balance and the present value of expected future cash flows discounted at the loan’s effective interest rate, or the fair value of the collateral, less costs to sell, if the loan is collateral dependent. Historical loss allocations are calculated at the loan class and segment levels based on a migration analysis of the loan portfolio, with the exception of advances to mortgage brokers, over the preceding five years. With no historical losses on advances to mortgage brokers, there is no allocation related to this portfolio. The unallocated component of the allowance reflects the margin of imprecision inherent in the underlying assumptions used in the methodologies for estimating specific and general losses in the portfolio. |
LOANS HELD FOR SALE | LOANS HELD FOR SALE: Mortgage loans held for sale on the secondary market are carried at the lower of cost or fair value as determined by aggregating outstanding commitments from investors or current investor yield requirements. Net unrealized losses, if any, would be recognized as a component of other noninterest expenses. Mortgage loans held for sale are sold with the mortgage servicing rights retained by us. Gains or losses on sales of mortgage loans are recognized based on the difference between the selling price and the carrying value of the related mortgage loans sold. |
TRANSFERS OF FINANCIAL ASSETS | TRANSFERS OF FINANCIAL ASSETS: Transfers of financial assets, including mortgage loans and participation loans, are accounted for as sales when control over the assets has been surrendered. Control over transferred assets is determined to be surrendered when 1) the assets have been legally isolated from us, 2) the transferee obtains the right (free of conditions that constrain it from taking advantage of the right) to pledge or exchange the transferred assets, and 3) we do not maintain effective control over the transferred assets through an agreement to repurchase them before their maturity. Other than servicing, we have no substantive continuing involvement related to these loans. |
SERVICING | SERVICING: Servicing assets are recognized as separate assets when rights are acquired through purchase or through sale of financial assets. We have no purchased servicing rights. For sales of mortgage loans, a portion of the cost of originating the loan is allocated to the servicing right based on relative fair value. Fair value is based on market prices for comparable mortgage servicing contracts, when available, or alternatively, is based on a valuation model that calculates the present value of estimated future net servicing income. The valuation model incorporates assumptions that market participants would use in estimating future net servicing income, such as the cost to service, the discount rate, the custodial earnings rate, an inflation rate, ancillary income, prepayment speeds and default rates and losses. Servicing assets are evaluated for impairment based upon the fair value of the rights as compared to amortized cost. Impairment is determined by stratifying rights into tranches based on predominant risk characteristics, such as interest rate, loan type, and investor type. Impairment is recognized through a valuation allowance for an individual tranche, to the extent that fair value is less than the capitalized amount for the tranche. If we later determine that all or a portion of the impairment no longer exists for a particular tranche, a reduction of the valuation allowance may be recorded as an increase to income. Capitalized servicing rights are reported in other assets and are amortized into noninterest income in proportion to, and over the period of, the estimated future net servicing income of the underlying financial assets. The unpaid principal balance of mortgages serviced for others was $264,206 and $278,844 with capitalized servicing rights of $2,559 and $2,124 at December 31, 2022 and 2021, respectively, which are included in other assets. Servicing fee income is recorded for fees earned for servicing loans for others. The fees are based on a contractual percentage of the outstanding principal or a fixed amount per loan and are recorded as income when earned. We recorded servicing fee revenue of $669, $747, and $625 related to residential mortgage loans serviced for others during 2022, 2021, and 2020, respectively, which is included in other noninterest income. |
FORECLOSED ASSETS | FORECLOSED ASSETS: Assets acquired through, or in lieu of, loan foreclosure are held for sale and are initially recorded at the lower of our carrying amount or fair value less estimated selling costs at the date of transfer, establishing a new cost basis. Any write downs based on the asset’s fair value at the date of acquisition are charged to the ALLL. After foreclosure, property held for sale is carried at the lower of the new cost basis or fair value less costs to sell. Impairment losses on property to be held and used are measured at the amount by which the carrying amount of property exceeds its fair value. Costs relating to holding these assets are expensed as incurred. We periodically perform valuations and any subsequent write downs are recorded as a charge to operations, if necessary, to reduce the carrying value of a property to the lower of our carrying amount or fair value less costs to sell. Foreclosed assets of $439 and $211 as of December 31, 2022 and 2021, respectively, are included in other assets. |
PREMISES AND EQUIPMENT | PREMISES AND EQUIPMENT: Land is carried at cost. Buildings and equipment are carried at cost, less accumulated depreciation which is computed principally by the straight-line method based upon the estimated useful lives of the related assets, which range from 3 to 40 years. Major improvements are capitalized and appropriately amortized based upon the useful lives of the related assets or the expected terms of the leases, if shorter, using the straight-line method. Maintenance, repairs and minor alterations are charged to current operations as expenditures occur. We annually review these assets to determine whether carrying values have been impaired. |
EQUITY SECURITIES WITHOUT READILY DETERMINABLE FAIR VALUES | EQUITY SECURITIES WITHOUT READILY DETERMINABLE FAIR VALUES: Included in equity securities without readily determinable fair values are our holdings in FHLB stock and FRB stock. Equity securities without readily determinable fair values consist of the following holdings as of December 31: 2022 2021 FHLB Stock $ 12,762 $ 15,050 FRB Stock 2,400 1,999 Other 584 334 Total $ 15,746 $ 17,383 |
EQUITY COMPENSATION PLAN | EQUITY COMPENSATION PLANS: At December 31, 2022, the Directors Plan had 207,840 shares eligible to be issued to participants, for which the Rabbi Trust held 154,879 shares. We had 189,364 shares to be issued at December 31, 2021, with 105,654 shares held in the Rabbi Trust. Under the RSP, compensation expense for nonvested stock awards is based on the fair value of the award on the measurement date. The fair value of nonvested stock awards is based on the date of the grant and is recognized over the requisite service period. The impact of forfeitures of share-based payment awards on compensation expense is recognized as forfeitures occur. Compensation costs relating to share-based payment transactions are recognized as the services are rendered, with the cost measured based on the fair value of the equity or liability instruments issued (see “Note 12 – Benefit Plans”). |
CORPORATE OWNED LIFE INSURANCE | CORPORATE OWNED LIFE INSURANCE: We have purchased life insurance policies on key members of management, partially for the purpose of funding certain post-retirement benefits. In the event of death of one of these individuals, we would receive a specified cash payment equal to the face value of the policy. Such policies are recorded at their cash surrender value, or the amount that can be realized on the balance sheet date. Increases in cash surrender value in excess of single premiums paid are reported as other noninterest income. |
ACQUISITION INTANGIBLES AND GOODWILL | ACQUISITION INTANGIBLES AND GOODWILL: We previously acquired branch facilities and related deposits in business combinations accounted for as a purchase. The acquisitions included amounts related to the valuation of customer deposit relationships (core deposit intangibles). Core deposit intangibles arising from acquisitions are included in goodwill and other intangible assets are being amortized over their estimated lives and evaluated for potential impairment on at least an annual basis. Goodwill, which represents the excess of the purchase price over identifiable assets, is not amortized but is evaluated for impairment on at least an annual basis. Acquisition intangibles and goodwill are typically qualitatively evaluated to determine if it is more likely than not that the carrying balance is impaired. If it is determined that the carrying balance is more likely than not to be impaired, we perform a cash flow valuation to determine the extent of the potential impairment. This valuation method requires a significant degree of our judgment. In the event the projected undiscounted net operating cash flows for these intangible assets are less than the carrying value, the asset is recorded at fair value as determined by the valuation model. |
OFF BALANCE SHEET CREDIT RELATED FINANCIAL INSTRUMENTS | OFF BALANCE SHEET CREDIT RELATED FINANCIAL INSTRUMENTS: In the ordinary course of business, we have entered into commitments to extend credit, including commitments under credit card arrangements, commercial lines of credit, home equity lines of credit, commercial letters of credit, and standby letters of credit. Such financial instruments are recorded only when funded. |
Revenue Recognition, Policy [Policy Text Block] | REVENUE RECOGNITION: Our revenue is comprised primarily of interest income, service charges and fees, gains on the sale of loans and AFS securities, earnings on corporate owned life insurance policies, and other noninterest income. Other noninterest income is typically service and performance driven in nature and comprised primarily of investment and trust advisory fees. We recognize revenue, excluding interest income and other income specifically scoped out, in accordance with ASC 606, Revenue From Contracts with Customers. Revenue is recognized when our performance obligation has been satisfied according to our contractual obligation. |
FEDERAL INCOME TAXES | FEDERAL INCOME TAXES: Deferred income tax assets and liabilities are determined using the liability (or balance sheet) method. Under this method, the net deferred tax assets or liabilities are determined based on the tax effects of the temporary differences between the book and tax basis on the various balance sheet assets and liabilities and gives current recognition to changes in tax rates and laws. Valuation allowances are established, where necessary, to reduce deferred tax assets to the amount expected to be realized. Income tax expense is the tax payable or refundable for the year plus or minus the change during the year in deferred tax assets and liabilities. We analyze our filing positions in the jurisdictions where we are required to file income tax returns, as well as all open tax years in these jurisdictions. We also treat interest and penalties attributable to income taxes, to the extent they arise, as a component of our noninterest expenses. |
DEFINED BENEFIT PENSION PLAN | DEFINED BENEFIT PENSION PLAN: We maintain a noncontributory defined benefit pension plan, which was curtailed effective March 1, 2007. The service cost component of the defined benefit pension plan is included in “compensation and benefits” on the consolidated statements of income and is funded consistent with the requirements of federal laws and regulations. All other costs related to the defined benefit pension plan are included in “other” noninterest expenses on the consolidated statements of income. The current benefit obligation is included in "accrued interest payable and other liabilities" on the consolidated balance sheets. Inherent in the determination of defined benefit pension costs are assumptions concerning future events that will affect the amount and timing of required benefit payments under the plan. These assumptions include demographic assumptions such as mortality, a discount rate used to determine the current benefit obligation and a long-term expected rate of return on plan assets. Net periodic benefit cost includes the interest cost based on the assumed discount rate, an expected return on plan assets based on an actuarially derived market-related value of assets, and amortization of unrecognized net actuarial gains or losses. Actuarial gains and losses result from experience different from that assumed and from changes in assumptions (excluding asset gains and losses not yet reflected in market-related value). Amortization of actuarial gains and losses is included as a component of net periodic defined benefit pension cost. For additional information, see “Note 12 – Benefit Plans.” |
MARKETING COSTS | MARKETING COSTS: Marketing costs are expensed as incurred (see “Note 14 – Other Noninterest Expenses”). |
RECLASSIFICATIONS | RECLASSIFICATIONS: Certain amounts reported in the 2021 and 2020 consolidated financial statements have been reclassified to conform with the 2022 presentation. |
EARNINGS PER SHARE | Basic earnings per common share represents income available to common shareholders divided by the weighted average number of common shares outstanding during the period. Diluted earnings per common share includes additional common shares that would have been outstanding if dilutive potential common shares had been issued. For further information related to potential common shares that may be issued relate solely to outstanding shares in the Directors Plan and grant awards under the RSP, see "Note 12 – Benefit Plans." |
NONACCRUAL LOAN STATUS | The accrual of interest on commercial and agricultural loans, as well as residential real estate loans, is discontinued at the time a loan is 90 days or more past due unless the credit is well-secured and in the process of short-term collection. Upon transferring a loan to nonaccrual status, we perform an evaluation to determine the net realizable value of the underlying collateral. This evaluation is used to help determine if a charge-off is necessary. Consumer loans are typically charged-off no later than 180 days past due. Past due status is based on the contractual term of the loan. In all cases, a loan is placed in nonaccrual status at an earlier date if collection of principal or interest is considered doubtful. When a loan is placed in nonaccrual status, all interest accrued in the current calendar year, but not collected, is reversed against interest income while interest accrued in prior calendar years, but not collected, is charged against the ALLL. Loans may be returned to accrual status after six months of continuous performance and achievement of current payment status. |
IMPAIRED LOANS | Loans may be classified as impaired if they meet one or more of the following criteria: 1. There has been a charge-off of its principal balance (in whole or in part); 2. The loan has been classified as a TDR; or 3. The loan is in nonaccrual status. Impairment is measured on a loan-by-loan basis for commercial and agricultural loans by comparing the loan’s outstanding balance to the present value of expected future cash flows discounted at the loan’s effective interest rate, or the fair value of the collateral, less costs to sell, if the loan is collateral dependent. Large groups of smaller-balance, homogeneous residential real estate and consumer loans are collectively evaluated for impairment by comparing the loan’s unpaid principal balance to the present value of expected future cash flows discounted at the loan’s effective interest rate. |
TROUBLED DEBT RESTRUCTURINGS | A loan modification is considered to be a TDR when the modification includes terms outside of normal lending practices to a borrower who is experiencing financial difficulties. Typical concessions granted include, but are not limited to: 1. Agreeing to interest rates below prevailing market rates for debt with similar risk characteristics. 2. Extending the amortization period beyond typical lending guidelines for loans with similar risk characteristics. 3. Agreeing to an interest only payment structure and delaying principal payments. 4. Forgiving principal. 5. Forgiving accrued interest. To determine if a borrower is experiencing financial difficulties, factors we consider include: 1. The borrower is currently in default on any of their debt. 2. The borrower would likely default on any of their debt if the concession is not granted. 3. The borrower’s cash flow is insufficient to service all of their debt if the concession is not granted. 4. The borrower has declared, or is in the process of declaring, bankruptcy. 5. The borrower is unlikely to continue as a going concern (if the entity is a business). |
Receivables, Loans, Notes Recei
Receivables, Loans, Notes Receivable, and Others (Policies) | 12 Months Ended |
Dec. 31, 2022 | |
Receivables [Abstract] | |
Loans and Leases Receivable, Allowance for Loan Losses Policy [Policy Text Block] | ALLOWANCE FOR LOAN AND LEASE LOSSES: The ALLL is established as losses are estimated to have occurred through a provision for loan losses charged to earnings. Loan losses are charged against the allowance when we believe the uncollectability of the loan balance is confirmed. Subsequent recoveries, if any, are credited to the allowance. We evaluate the ALLL on a regular basis. Our periodic review of the collectability of loans considers historical experience, the nature and volume of the loan portfolio, adverse situations that may affect the borrower’s ability to repay, estimated value of any underlying collateral and prevailing economic conditions. This evaluation is inherently subjective as it requires estimates that are susceptible to significant revision as more information becomes available. The ALLL consists of specific, general, and unallocated components. The specific component relates to loans that are deemed to be impaired. For such loans that are analyzed for specific allowance allocations, an allowance is established when the discounted cash flows or collateral value, less costs to sell, of the impaired loan is lower than the carrying value of that loan. The general component covers non-impaired loans and is based on historical loss experience adjusted for current conditions. An unallocated component is maintained to cover uncertainties that we believe affect our estimate of probable losses based on qualitative factors. The unallocated component of the allowance reflects the margin of imprecision inherent in the underlying assumptions used in the methodologies for estimating specific and general losses in the portfolio. Loans may be classified as impaired if they meet one or more of the following criteria: 1. There has been a charge-off of its principal balance; 2. The loan has been classified as a TDR; or 3. The loan is in nonaccrual status. Impairment is measured on a loan-by-loan basis by either the present value of expected future cash flows discounted at the loan’s effective interest rate, or the fair value of the collateral, less costs to sell, if the loan is collateral dependent. Large groups of smaller-balance, homogeneous loans are collectively evaluated for impairment. The ALLL is established as losses are estimated to have occurred through a provision for loan losses charged to earnings. Full or partial loan balances are charged against the ALLL when we believe uncollectability is probable. Subsequent recoveries, if any, are credited to the ALLL The ALLL is evaluated on a regular basis for appropriateness. Our periodic review of the collectability of a loan considers historical experience, the nature and volume of the loan portfolio, adverse situations that may affect the borrower’s ability to repay, estimated value of any underlying collateral, and prevailing economic conditions. This evaluation is inherently subjective as it requires estimates that are susceptible to significant revision as more information becomes available. The primary factors behind the determination of the level of the ALLL are specific allocations for impaired loans, historical loss percentages, as well as unallocated components. Specific allocations for impaired loans are primarily determined based on the difference between the loan’s outstanding balance and the present value of expected future cash flows discounted at the loan’s effective interest rate, or the fair value of the collateral, less costs to sell, if the loan is collateral dependent. Historical loss allocations are calculated at the loan class and segment levels based on a migration analysis of the loan portfolio, with the exception of advances to mortgage brokers, over the preceding five years. With no historical losses on advances to mortgage brokers, there is no allocation related to this portfolio. The unallocated component of the allowance reflects the margin of imprecision inherent in the underlying assumptions used in the methodologies for estimating specific and general losses in the portfolio. |
Fair Value Fair Value Measureme
Fair Value Fair Value Measurement, Policy (Policies) | 12 Months Ended |
Dec. 31, 2022 | |
Fair Value Measurement, Policy [Abstract] | |
Fair Value Measurement, Policy [Policy Text Block] | FAIR VALUE MEASUREMENTS : Fair value refers to the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants in the market in which the reporting entity transacts such sales or transfers based on the assumptions market participants would use when pricing an asset or liability. Assumptions are developed based on prioritizing information within a fair value hierarchy that gives the highest priority to quoted prices in active markets and the lowest priority to unobservable data, such as the reporting entity’s own data. We may choose to measure eligible items at fair value at specified election dates. For assets and liabilities recorded at fair value, it is our policy to maximize the use of observable inputs and minimize the use of unobservable inputs when developing fair value measurements for those financial instruments for which there is an active market. In cases where the market for a financial asset or liability is not active, we include appropriate risk adjustments that market participants would make for nonperformance and liquidity risks when developing fair value measurements. Fair value measurements for assets and liabilities for which limited or no observable market data exists are accordingly based primarily upon estimates, are often calculated based on the economic and competitive environment, the characteristics of the asset or liability and other factors. Therefore, the results cannot be determined with precision and may not be realized in an actual sale or immediate settlement of the asset or liability. Additionally, there may be inherent weaknesses in any calculation technique, and changes in the underlying assumptions used, including discount rates and estimates of future cash flows, could significantly affect the results of current or future values. We utilize fair value measurements to record fair value adjustments to certain assets and liabilities and to determine fair value disclosures. Investment securities AFS and derivative instruments are recorded at fair value on a recurring basis. Additionally, from time to time, we may be required to record other assets and liabilities at fair value on a nonrecurring basis, such as mortgage loans AFS, impaired loans, foreclosed assets, OMSR, goodwill, and certain other assets and liabilities. These nonrecurring fair value adjustments typically involve the application of lower of cost or market accounting or write downs of individual assets. Fair Value Hierarchy Under fair value measurement and disclosure authoritative guidance, we group assets and liabilities measured at fair value into three levels, based on the markets in which the assets and liabilities are traded, and the reliability of the assumptions used to determine fair value, based on the prioritization of inputs in the valuation techniques. These levels are: Level 1: Valuation is based upon quoted prices for identical instruments traded in active markets. Level 2: Valuation is based upon quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active and model based valuation techniques for which all significant assumptions are observable in the market. Level 3: Valuation is generated from model based techniques that use at least one significant assumption not observable in the market. These unobservable assumptions reflect estimates of assumptions that market participants would use in pricing the asset or liability. The asset’s or liability’s fair value measurement level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. Valuation techniques maximize the use of observable inputs and minimize the use of unobservable inputs. Transfers between measurement levels are recognized at the end of reporting periods. For further discussion of fair value considerations, refer to “Note 17 – Fair Value.” Under fair value measurement and disclosure authoritative guidance, we group assets and liabilities measured at fair value into three levels, based on the markets in which the assets and liabilities are traded, and the reliability of the assumptions used to determine fair value, based on the prioritization of inputs in the valuation techniques. These levels are: Level 1: Valuation is based upon quoted prices for identical instruments traded in active markets. Level 2: Valuation is based upon quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active and model based valuation techniques for which all significant assumptions are observable in the market. Level 3: Valuation is generated from model based techniques that use at least one significant assumption not observable in the market. These unobservable assumptions reflect estimates of assumptions that market participants would use in pricing the asset or liability. The asset’s or liability’s fair value measurement level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. Valuation techniques maximize the use of observable inputs and minimize the use of unobservable inputs. Transfers between measurement levels are recognized at the end of reporting periods. Fair value measurement requires the use of an exit price notion which may differ from entrance pricing. Generally, we believe our assets and liabilities classified as Level 1 or Level 2 approximate an exit price notion. |
Nature of Operations and Summ_3
Nature of Operations and Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Accounting Policies [Abstract] | |
Schedule of equity method and other investments | Equity securities without readily determinable fair values consist of the following holdings as of December 31: 2022 2021 FHLB Stock $ 12,762 $ 15,050 FRB Stock 2,400 1,999 Other 584 334 Total $ 15,746 $ 17,383 |
AFS Securities (Tables)
AFS Securities (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Investments, Debt and Equity Securities [Abstract] | |
Amortized cost and fair value of available-for-sale securities | The amortized cost and fair value of AFS securities, with gross unrealized gains and losses, are as follows as of December 31: 2022 Amortized Gross Gross Fair U.S. Treasury $ 231,622 $ — $ 22,921 $ 208,701 States and political subdivisions 122,023 392 4,903 117,512 Auction rate money market preferred 3,200 — 858 2,342 Mortgage-backed securities 42,309 — 3,239 39,070 Collateralized mortgage obligations 218,301 — 12,573 205,728 Corporate 8,150 — 1,022 7,128 Total $ 625,605 $ 392 $ 45,516 $ 580,481 2021 Amortized Gross Gross Fair U.S. Treasury $ 212,379 $ — $ 2,676 $ 209,703 States and political subdivisions 116,836 4,457 88 121,205 Auction rate money market preferred 3,200 42 — 3,242 Mortgage-backed securities 54,710 1,438 — 56,148 Collateralized mortgage obligations 90,435 1,876 10 92,301 Corporate 8,150 19 167 8,002 Total $ 485,710 $ 7,832 $ 2,941 $ 490,601 |
Amortized cost and fair value of available-for-sale securities by contractual maturity | The amortized cost and fair value of AFS securities by contractual maturity at December 31, 2022 are as follows: Maturing Securities with Variable Monthly Payments or Noncontractual Maturities Due in After One After Five After Total U.S. Treasury $ — $ 231,622 $ — $ — $ — $ 231,622 States and political subdivisions 19,753 42,946 21,234 38,090 — 122,023 Auction rate money market preferred — — — — 3,200 3,200 Mortgage-backed securities — — — — 42,309 42,309 Collateralized mortgage obligations — — — — 218,301 218,301 Corporate — — 8,150 — — 8,150 Total amortized cost $ 19,753 $ 274,568 $ 29,384 $ 38,090 $ 263,810 $ 625,605 Fair value $ 19,666 $ 251,479 $ 27,703 $ 34,493 $ 247,140 $ 580,481 |
Summary of the activity related to sales of available-for-sale securities | A summary of the sales activity of AFS securities during the years ended December 31 is displayed in the following table. 2022 2021 2020 Proceeds from sales of AFS securities $ — $ — $ 26,855 Realized gains (losses) $ — $ — $ 71 Applicable income tax expense (benefit) $ — $ — $ 15 |
Debt Securities, Available-for-sale, Unrealized Loss Position, Fair Value | The information on the following tables pertains to AFS securities with gross unrealized losses at December 31, 2022 and 2021 aggregated by investment category and length of time that individual securities have been in a continuous loss position. December 31, 2022 Less Than Twelve Months Twelve Months or More Gross Fair Gross Fair Total U.S. Treasury $ 1,388 $ 18,331 $ 21,533 $ 190,369 $ 22,921 States and political subdivisions 2,389 48,083 2,514 40,667 4,903 Auction rate money market preferred — — 858 2,342 858 Mortgage-backed securities 3,239 39,069 — — 3,239 Collateralized mortgage obligations 12,408 201,316 165 4,411 12,573 Corporate — — 1,022 7,128 1,022 Total $ 19,424 $ 306,799 $ 26,092 $ 244,917 $ 45,516 Number of securities in an unrealized loss position: 178 266 444 December 31, 2021 Less Than Twelve Months Twelve Months or More Gross Fair Gross Fair Total U.S. Treasury $ 2,676 $ 209,703 $ — $ — $ 2,676 States and political subdivisions 88 9,674 — — 88 Collateralized mortgage obligations 10 11,165 — — 10 Corporate 167 6,283 — — 167 Total $ 2,941 $ 236,825 $ — $ — $ 2,941 Number of securities in an unrealized loss position: 40 — 40 |
Loans and ALLL (Tables)
Loans and ALLL (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Receivables [Abstract] | |
Summary of changes in the ALLL and the recorded investment in loans by segments | A summary of changes in the ALLL and the recorded investment in loans by segments follows: Allowance for Loan Losses Year Ended December 31, 2022 Commercial Agricultural Residential Real Estate Consumer Unallocated Total January 1, 2022 $ 1,740 $ 289 $ 747 $ 908 $ 5,419 $ 9,103 Charge-offs (77) — — (542) — (619) Recoveries 442 9 150 282 — 883 Provision for loan losses (784) 279 (280) 313 955 483 December 31, 2022 $ 1,321 $ 577 $ 617 $ 961 $ 6,374 $ 9,850 Allowance for Loan Losses Year Ended December 31, 2021 Commercial Agricultural Residential Real Estate Consumer Unallocated Total January 1, 2021 $ 2,162 $ 311 $ 1,363 $ 798 $ 5,110 $ 9,744 Charge-offs (32) (77) (12) (486) — (607) Recoveries 133 12 162 177 — 484 Provision for loan losses (523) 43 (766) 419 309 (518) December 31, 2021 $ 1,740 $ 289 $ 747 $ 908 $ 5,419 $ 9,103 |
Allowance for Loan Losses and Recorded Investment in Loans | Allowance for Loan Losses and Recorded Investment in Loans As of December 31, 2022 Commercial Agricultural Residential Real Estate Consumer Unallocated Total ALLL Individually evaluated for impairment $ 12 $ — $ 439 $ — $ — $ 451 Collectively evaluated for impairment 1,309 577 178 961 6,374 9,399 Total $ 1,321 $ 577 $ 617 $ 961 $ 6,374 $ 9,850 Loans Individually evaluated for impairment $ 8,342 $ 10,935 $ 2,741 $ — $ 22,018 Collectively evaluated for impairment 732,578 93,379 338,144 78,054 1,242,155 Total $ 740,920 $ 104,314 $ 340,885 $ 78,054 $ 1,264,173 Allowance for Loan Losses and Recorded Investment in Loans As of December 31, 2021 Commercial Agricultural Residential Real Estate Consumer Unallocated Total ALLL Individually evaluated for impairment $ 13 $ — $ 565 $ — $ — $ 578 Collectively evaluated for impairment 1,727 289 182 908 5,419 8,525 Total $ 1,740 $ 289 $ 747 $ 908 $ 5,419 $ 9,103 Loans Individually evaluated for impairment $ 9,267 $ 14,189 $ 3,454 $ — $ 26,910 Collectively evaluated for impairment 798,172 79,766 322,907 73,282 1,274,127 Total $ 807,439 $ 93,955 $ 326,361 $ 73,282 $ 1,301,037 |
Credit quality indicators for commercial and agricultural credit exposures | The following tables display the credit quality indicators for commercial and agricultural credit exposures based on internally assigned credit risk ratings as of December 31: 2022 Commercial Agricultural Real Estate Other Advances to Mortgage Brokers Total Real Estate Other Total Total Rating 1 - Excellent $ — $ — $ — $ — $ — $ — $ — $ — 2 - High quality 9,045 4,533 — 13,578 342 100 442 14,020 3 - High satisfactory 68,133 36,608 — 104,741 9,757 4,608 14,365 119,106 4 - Low satisfactory 471,009 114,565 — 585,574 43,587 21,214 64,801 650,375 5 - Special mention 20,770 7,447 — 28,217 12,262 4,634 16,896 45,113 6 - Substandard 5,629 3,085 — 8,714 6,316 1,260 7,576 16,290 7 - Vulnerable 74 22 — 96 67 167 234 330 8 - Doubtful — — — — — — — — 9 - Loss — — — — — — — — Total $ 574,660 $ 166,260 $ — $ 740,920 $ 72,331 $ 31,983 $ 104,314 $ 845,234 2021 Commercial Agricultural Real Estate Other Advances to Mortgage Brokers Total Real Estate Other Total Total Rating 1 - Excellent $ — $ 300 $ — $ 300 $ — $ — $ — $ 300 2 - High quality 9,010 6,881 — 15,891 453 — 453 16,344 3 - High satisfactory 86,135 46,087 72,001 204,223 9,361 4,295 13,656 217,879 4 - Low satisfactory 448,489 104,375 — 552,864 36,483 15,986 52,469 605,333 5 - Special mention 13,212 1,351 — 14,563 13,096 3,452 16,548 31,111 6 - Substandard 13,519 5,738 — 19,257 6,252 3,803 10,055 29,312 7 - Vulnerable 222 119 — 341 499 275 774 1,115 8 - Doubtful — — — — — — — — 9 - Loss — — — — — — — — Total $ 570,587 $ 164,851 $ 72,001 $ 807,439 $ 66,144 $ 27,811 $ 93,955 $ 901,394 |
Summary of past due and current loans | Our primary credit quality indicator for residential real estate and consumer loans is the individual loan’s past due aging. The following tables summarize the past due and current loans for the entire loan portfolio as of December 31: 2022 Accruing Interest Total Past Due and Nonaccrual 30-59 60-89 90 Days Nonaccrual Current Total Commercial Commercial real estate $ 4,553 $ 2,570 $ — $ 74 $ 7,197 $ 567,463 $ 574,660 Commercial other 285 — — 22 307 165,953 166,260 Advances to mortgage brokers — — — — — — — Total commercial 4,838 2,570 — 96 7,504 733,416 740,920 Agricultural Agricultural real estate — — — 67 67 72,264 72,331 Agricultural other — — — 167 167 31,816 31,983 Total agricultural — — — 234 234 104,080 104,314 Residential real estate Senior liens 2,943 225 — 127 3,295 301,606 304,901 Junior liens — — — — — 3,282 3,282 Home equity lines of credit 38 — — — 38 32,664 32,702 Total residential real estate 2,981 225 — 127 3,333 337,552 340,885 Consumer Secured 47 8 — — 55 74,886 74,941 Unsecured 4 — — — 4 3,109 3,113 Total consumer 51 8 — — 59 77,995 78,054 Total $ 7,870 $ 2,803 $ — $ 457 $ 11,130 $ 1,253,043 $ 1,264,173 2021 Accruing Interest Total Past Due and Nonaccrual 30-59 60-89 90 Days Nonaccrual Current Total Commercial Commercial real estate $ 135 $ — $ — $ 222 $ 357 $ 570,230 $ 570,587 Commercial other 85 — — 119 204 164,647 164,851 Advances to mortgage brokers — — — — — 72,001 72,001 Total commercial 220 — — 341 561 806,878 807,439 Agricultural Agricultural real estate 213 — — 499 712 65,432 66,144 Agricultural other — — — 275 275 27,536 27,811 Total agricultural 213 — — 774 987 92,968 93,955 Residential real estate Senior liens 2,016 37 97 93 2,243 290,900 293,143 Junior liens — — — — — 2,439 2,439 Home equity lines of credit 7 — — 37 44 30,735 30,779 Total residential real estate 2,023 37 97 130 2,287 324,074 326,361 Consumer Secured 186 — — — 186 70,259 70,445 Unsecured 10 — — — 10 2,827 2,837 Total consumer 196 — — — 196 73,086 73,282 Total $ 2,652 $ 37 $ 97 $ 1,245 $ 4,031 $ 1,297,006 $ 1,301,037 |
Information pertaining to impaired loans | The following summarizes information pertaining to impaired loans as of, and for the years ended, December 31: 2022 Recorded Balance Unpaid Principal Balance Valuation Allowance Average Recorded Balance Interest Income Recognized Impaired loans with a valuation allowance Commercial real estate $ 183 $ 184 $ 12 $ 189 $ 12 Commercial other — — — 1,724 62 Residential real estate senior liens 2,741 3,001 439 3,056 126 Total impaired loans with a valuation allowance 2,924 3,185 451 4,969 200 Impaired loans without a valuation allowance Commercial real estate 5,366 5,682 5,514 338 Commercial other 2,793 2,793 626 58 Agricultural real estate 8,522 8,522 8,568 468 Agricultural other 2,413 2,413 2,984 157 Home equity lines of credit — — 5 — Total impaired loans without a valuation allowance 19,094 19,410 17,697 1,021 Impaired loans Commercial 8,342 8,659 12 8,053 470 Agricultural 10,935 10,935 — 11,552 625 Residential real estate 2,741 3,001 439 3,061 126 Total impaired loans $ 22,018 $ 22,595 $ 451 $ 22,666 $ 1,221 2021 Recorded Balance Unpaid Principal Balance Valuation Allowance Average Recorded Balance Interest Income Recognized Impaired loans with a valuation allowance Commercial real estate $ 192 $ 193 $ 9 $ 1,668 $ 69 Commercial other 2,802 2,802 4 1,909 103 Agricultural real estate — — — 553 11 Agricultural other — — — 169 — Residential real estate senior liens 3,417 3,688 565 3,794 151 Total impaired loans with a valuation allowance 6,411 6,683 578 8,093 334 Impaired loans without a valuation allowance Commercial real estate 5,829 6,145 6,313 398 Commercial other 444 444 1,963 68 Agricultural real estate 9,538 9,538 9,739 699 Agricultural other 4,651 4,651 4,269 235 Home equity lines of credit 37 37 5 — Total impaired loans without a valuation allowance 20,499 20,815 22,289 1,400 Impaired loans Commercial 9,267 9,584 13 11,853 638 Agricultural 14,189 14,189 — 14,730 945 Residential real estate 3,454 3,725 565 3,799 151 Total impaired loans $ 26,910 $ 27,498 $ 578 $ 30,382 $ 1,734 |
Information pertaining to TDR's | The following is a summary of information pertaining to TDRs granted in the years ended December 31: 2022 2021 Number of Loans Pre-Modification Recorded Investment Post-Modification Recorded Investment Number of Loans Pre-Modification Recorded Investment Post-Modification Recorded Investment Commercial other 3 $ 2,871 $ 2,871 5 $ 4,761 $ 4,761 Agricultural other — — — 6 3,712 3,712 Residential real estate 1 98 98 — — — Total 4 $ 2,969 $ 2,969 11 $ 8,473 $ 8,473 The following table summarizes the nature of the concessions we granted to borrowers in financial difficulty in the years ended December 31: 2022 2021 Below Market Interest Rate Below Market Interest Rate and Extension of Amortization Period Below Market Interest Rate Below Market Interest Rate and Extension of Amortization Period Number of Loans Pre-Modification Recorded Investment Number of Loans Pre-Modification Recorded Investment Number of Loans Pre-Modification Recorded Investment Number of Loans Pre-Modification Recorded Investment Commercial other 3 $ 2,871 — $ — 1 $ 3,189 4 $ 1,572 Agricultural other — — — — 6 3,712 — — Residential real estate — — 1 98 — — — — Total 3 $ 2,871 1 $ 98 7 $ 6,901 4 $ 1,572 The following is a summary of TDR loan balances as of December 31: 2022 2021 TDRs $ 21,339 $ 25,725 |
Premises and Equipment (Tables)
Premises and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Property, Plant and Equipment [Abstract] | |
Summary of premises and equipment | A summary of premises and equipment at December 31 follows: 2022 2021 Land $ 5,904 $ 6,164 Buildings and improvements 31,260 30,738 Furniture and equipment 35,906 36,132 Total 73,070 73,034 Less: accumulated depreciation 47,517 48,615 Premises and equipment, net $ 25,553 $ 24,419 |
Goodwill and Other Intangible_2
Goodwill and Other Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Summary of identifiable intangible assets | Identifiable intangible assets were as follows as of December 31: 2022 Gross Accumulated Net Core deposit premium resulting from acquisitions $ 5,579 $ 5,574 $ 5 2021 Gross Accumulated Net Core deposit premium resulting from acquisitions $ 5,579 $ 5,559 $ 20 |
Summary of estimated amortization expense associated with identifiable intangibles | Estimated amortization expense associated with identifiable intangibles for each of the next three years succeeding December 31, 2022, and thereafter is as follows: Estimated Amortization Expense 2023 $ 2 2024 2 2025 1 Total $ 5 |
Deposits (Tables)
Deposits (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Deposits [Abstract] | |
Scheduled maturities of time deposits | Scheduled annual maturities of time deposits for each of the next five years, and thereafter, are as follows: Scheduled Maturities of Time Deposits 2023 $ 153,482 2024 41,744 2025 23,288 2026 18,364 2027 15,055 Thereafter 107 Total $ 252,040 |
Borrowed Funds (Tables)
Borrowed Funds (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Debt Disclosure [Abstract] | |
Summary of short term borrowings | We had no FRB Discount Window advances for the years ended December 31, 2022 and 2021. The following table provides a summary of securities sold under repurchase agreements without stated maturity dates and federal funds purchased for the years ended December 31: 2022 2021 Maximum Month End Balance Average Balance Weighted Average Interest Rate During the Period Maximum Month End Balance Average Balance Weighted Average Interest Rate During the Period Securities sold under agreements to repurchase without stated maturity dates $ 58,140 $ 49,973 0.16 % $ 71,059 $ 57,451 0.09 % Federal funds purchased — 1 3.02 % 80 2 0.47 % Securities sold under agreements to repurchase are classified as secured borrowings and are reflected at the amount of cash received in connection with the transaction. The securities underlying the agreements have a carrying value and a fair value of $58,291 and $50,173 at December 31, 2022 and 2021, respectively. Such securities remain under our control. We may be required to provide additional collateral based on the fair value of underlying securities. Securities sold under repurchase agreements without stated maturity dates were as follows at December 31: 2022 2021 Amount Rate Amount Rate Securities sold under agreements to repurchase without stated maturity dates $ 57,771 0.49 % $ 50,162 0.07 % |
Summary of pledged financial instruments | We had pledged AFS securities and 1-4 family residential real estate loans in the following amounts at December 31: 2022 2021 Pledged to secure borrowed funds $ 347,331 $ 334,415 Pledged to secure repurchase agreements 58,291 50,173 Pledged for public deposits and for other purposes necessary or required by law 48,698 28,154 Total $ 454,320 $ 412,742 AFS securities pledged to repurchase agreements without stated maturity dates consisted of the following at December 31: 2022 2021 U.S. Treasury $ 29,351 $ 9,711 States and political subdivisions 11,037 13,491 Mortgage-backed securities 6,819 13,174 Collateralized mortgage obligations 11,084 13,797 Total $ 58,291 $ 50,173 |
Federal home loan bank, advances | The following table lists the maturities and weighted average interest rates of FHLB advances as of: 2022 2021 Amount Rate Amount Rate Fixed rate due 2022 $ — 0.00 % $ 20,000 1.97 % |
Schedule of Subordinated Borrowing | The following table summarizes our outstanding notes at December 31: 2022 2021 Amount Rate Amount Rate Fixed rate at 3.25% to floating, due 2031 $ 30,000 3.25 % $ 30,000 3.25 % Unamortized issuance costs (755) (842) Total subordinated debt, net $ 29,245 $ 29,158 |
Off-Balance-Sheet Activities (T
Off-Balance-Sheet Activities (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Notional amount of financial instrument | The following table summarizes our credit related financial instruments with off-balance-sheet risk as of December 31: 2022 2021 Unfunded commitments under lines of credit $ 264,902 $ 231,120 Commercial and standby letters of credit 1,321 1,738 Commitments to grant loans 24,770 32,448 Total $ 290,993 $ 265,306 |
Minimum Regulatory Capital Re_2
Minimum Regulatory Capital Requirements (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Banking Regulation, Risk-Based Information [Abstract] | |
Summary of compliance with regulatory capital requirements | Our actual capital amounts and ratios are also presented in the table. Actual Minimum Minimum To Be Well Amount Ratio Amount Ratio Amount Ratio December 31, 2022 Common equity Tier 1 capital to risk weighted assets Isabella Bank $ 190,060 14.07 % $ 94,565 7.00 % $ 87,811 6.50 % Consolidated 175,112 12.91 % 94,948 7.00 % N/A N/A Tier 1 capital to risk weighted assets Isabella Bank 190,060 14.07 % 114,829 8.50 % 108,075 8.00 % Consolidated 175,112 12.91 % 115,295 8.50 % N/A N/A Total capital to risk weighted assets Isabella Bank 199,910 14.80 % 141,848 10.50 % 135,093 10.00 % Consolidated 214,207 15.79 % 142,423 10.50 % N/A N/A Tier 1 capital to average assets Isabella Bank 190,060 9.36 % 81,181 4.00 % 101,476 5.00 % Consolidated 175,112 8.61 % 81,392 4.00 % N/A N/A Actual Minimum Minimum To Be Well Amount Ratio Amount Ratio Amount Ratio December 31, 2021 Common equity Tier 1 capital to risk weighted assets Isabella Bank $ 171,255 12.91 % $ 92,849 7.00 % $ 86,217 6.50 % Consolidated 160,871 12.07 % 93,297 7.00 % N/A N/A Tier 1 capital to risk weighted assets Isabella Bank 171,255 12.91 % 112,746 8.50 % 106,114 8.00 % Consolidated 160,871 12.07 % 113,289 8.50 % N/A N/A Total capital to risk weighted assets Isabella Bank 180,358 13.60 % 139,274 10.50 % 132,642 10.00 % Consolidated 199,132 14.94 % 139,945 10.50 % N/A N/A Tier 1 capital to average assets Isabella Bank 171,255 8.54 % 80,171 4.00 % 100,214 5.00 % Consolidated 160,871 7.97 % 80,733 4.00 % N/A N/A |
Computation of Earnings Per C_2
Computation of Earnings Per Common Share (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Earnings Per Share [Abstract] | |
Computation of earnings per common share | Earnings per common share have been computed based on the following for the years ended December 31: 2022 2021 2020 Average number of common shares outstanding for basic calculation 7,549,878 7,853,398 7,959,705 Average potential effect of common shares in the Directors Plan (1) 70,329 99,813 143,878 Average potential effect of common shares in the RSP 27,405 12,750 2,508 Average number of common shares outstanding used to calculate diluted earnings per common share 7,647,612 7,965,961 8,106,091 Net income $ 22,238 $ 19,499 $ 10,885 Earnings per common share Basic $ 2.95 $ 2.48 $ 1.37 Diluted $ 2.91 $ 2.45 $ 1.34 (1) Exclusive of shares held in the Rabbi Trust |
Benefit Plans (Tables)
Benefit Plans (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Retirement Benefits [Abstract] | |
Changes in the projected benefit obligation, plan assets and Accrued pension benefit costs | Changes in the projected benefit obligation and plan assets during each year, the funded status of the plan, and the net amount recognized in our consolidated balance sheets using an actuarial measurement date of December 31, are summarized as follows during the years ended December 31: 2022 2021 Change in benefit obligation Benefit obligation, January 1 $ 9,725 $ 10,358 Interest cost 224 233 Actuarial loss (gain) (2,236) (357) Benefits paid, including plan expenses (817) (509) Benefit obligation, December 31 6,896 9,725 Change in plan assets Fair value of plan assets, January 1 8,649 8,263 Investment return (loss) (1,250) 831 Contributions — 64 Benefits paid, including plan expenses (817) (509) Fair value of plan assets, December 31 6,582 8,649 Deficiency in funded status at December 31, included on the consolidated balance sheets in accrued interest payable and other liabilities $ (314) $ (1,076) Accumulated benefit obligation at December 31 $ 6,896 $ 9,725 2022 2021 Change in accrued pension benefit costs Accrued benefit cost at January 1 $ (1,076) $ (2,095) Contributions — 64 Net periodic benefit cost (credit) (59) 31 Net change in unrecognized actuarial loss and prior service cost 821 924 Accrued pension liability at December 31 $ (314) $ (1,076) |
Components of net periodic benefit cost | The components of net periodic benefit cost are as follows for the years ended December 31: 2022 2021 2020 Interest cost on benefit obligation $ 224 $ 233 $ 306 Expected return on plan assets (490) (486) (488) Amortization of unrecognized actuarial net loss 216 222 206 Settlement loss 109 — 152 Net periodic benefit cost (credit) $ 59 $ (31) $ 176 |
Actuarial assumptions used | The actuarial assumptions used in determining the benefit obligation are as follows for the years ended December 31: 2022 2021 2020 Discount rate 4.88 % 2.43 % 2.30 % Expected long-term rate of return on plan assets 6.00 % 6.00 % 6.00 % The actuarial weighted average assumptions used in determining the net periodic pension costs are as follows for the years ended December 31: 2022 2021 2020 Discount rate 2.43 % 2.30 % 3.07 % Expected long-term rate of return on plan assets 6.00 % 6.00 % 6.00 % |
Fair values of the Corporations pension plan assets by asset category | The fair values of our pension plan assets by asset category were as follows as of December 31: 2022 2021 Total (Level 2) Total (Level 2) Short-term investments $ 235 $ 235 $ 127 $ 127 Common collective trusts Fixed income 2,983 2,983 3,750 3,750 Equity investments 3,364 3,364 4,772 4,772 Total $ 6,582 $ 6,582 $ 8,649 $ 8,649 |
Summary of Estimated future benefit payments | Estimated future benefit payments are as follows for the next ten years: Estimated Benefit Payments 2023 $ 800 2024 564 2025 669 2026 713 2027 546 2028 - 2032 2,557 |
Components of shares eligible to be issued under the Directors Plan | The components of shares eligible to be issued under the Directors Plan were as follows as of December 31: 2022 2021 Eligible Market Eligible Market Unissued 52,961 $ 1,245 83,710 $ 2,135 Shares held in Rabbi Trust 154,879 3,640 105,654 2,694 Total 207,840 $ 4,885 189,364 $ 4,829 |
Changes in Nonvested Restricted Stock Awards | A summary of changes in nonvested restricted stock awards follows for the years ended December 31: 2022 2021 Number Fair Number Fair Balance, January 1 20,123 $ 418 4,658 $ 82 Granted 6,949 174 15,465 336 Vested — — — — Forfeited — — — — Balance, December 31 27,072 $ 592 20,123 $ 418 |
Other Noninterest Expenses (Tab
Other Noninterest Expenses (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Other Income and Expenses [Abstract] | |
Summary of expenses included in other noninterest expenses | A summary of expenses included in other noninterest expenses is as follows for the years ended December 31: 2022 2021 2020 Audit, consulting, and legal fees $ 2,358 $ 2,066 $ 1,836 ATM and debit card fees 1,909 1,810 1,441 Marketing costs 1,056 939 877 Loan underwriting fees 1,004 849 825 Donations and community relations 923 705 723 Memberships and subscriptions 876 877 740 Director fees 790 703 695 FDIC insurance premiums 537 690 612 All other 2,783 2,183 2,725 Total other noninterest expenses $ 12,236 $ 10,822 $ 10,474 |
Federal Income Taxes (Tables)
Federal Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
Components of the consolidated provision for federal income taxes | Components of the consolidated provision for federal income taxes are summarized as follows for the years ended December 31: 2022 2021 2020 Currently payable $ 4,593 $ 4,371 $ 1,263 Deferred expense (benefit) 13 (523) (276) Income tax expense $ 4,606 $ 3,848 $ 987 |
Summary of federal income tax expense | The reconciliation of the provision for federal income taxes and the amount computed at the federal statutory tax rate of 21% of income before federal income tax expense is as follows for the year ended December 31: 2022 2021 2020 Income taxes at statutory rate $ 5,637 $ 4,903 $ 2,493 Effect of nontaxable income Interest income on tax exempt municipal securities (587) (643) (802) Earnings on corporate owned life insurance policies (197) (225) (346) Other 329 312 288 Total effect of nontaxable income (455) (556) (860) Effect of nondeductible expenses 45 46 68 Effect of tax credits (621) (617) (830) Unrecognized deferred tax benefit on joint venture investment — 72 116 Federal income tax expense $ 4,606 $ 3,848 $ 987 |
Summary of deferred tax assets and liabilities | Significant components of our deferred tax assets and liabilities, measured at the 21% statutory rate, included in other assets and other liabilities on our consolidated balance sheets, are summarized as follows as of December 31: 2022 2021 Deferred tax assets Allowance for loan losses $ 1,848 $ 1,635 Deferred compensation 1,648 1,553 Employee benefit plans 82 98 Core deposit premium and acquisition expenses 764 759 Net unrealized losses on AFS securities 9,296 — Net unrecognized actuarial losses on pension plan 363 536 Life insurance death benefit payable 497 497 Other 789 867 Total deferred tax assets 15,287 5,945 Deferred tax liabilities Prepaid pension cost 297 309 Premises and equipment 1,590 1,729 Accretion on securities 166 61 Core deposit premium and acquisition expenses 984 947 Net unrealized gains on AFS securities — 1,018 Other 1,075 834 Total deferred tax liabilities 4,112 4,898 Net deferred tax assets (liabilities) $ 11,175 $ 1,047 |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Income (Loss) (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Equity [Abstract] | |
Summary of the components of accumulated other comprehensive income | The following table provides a roll-forward of the changes in AOCI by component for the years ended December 31, 2020, 2021 and 2022 (net of tax): Unrealized Unrealized Change in Unrecognized Pension Cost on Defined Total Balance, January 1, 2020 $ 4,612 $ 54 $ (2,695) $ 1,971 OCI before reclassifications 7,474 (121) (238) 7,115 Amounts reclassified from AOCI (71) — 176 105 Subtotal 7,403 (121) (62) 7,220 Tax effect (1,530) 25 12 (1,493) OCI, net of tax 5,873 (96) (50) 5,727 Balance, December 31, 2020 10,485 (42) (2,745) 7,698 OCI before reclassifications (8,371) 53 955 (7,363) Amounts reclassified from AOCI — — (31) (31) Subtotal (8,371) 53 924 (7,394) Tax effect 1,759 (11) (193) 1,555 OCI, net of tax (6,612) 42 731 (5,839) Balance, December 31, 2021 3,873 — (2,014) 1,859 OCI before reclassifications (50,015) — 762 (49,253) Amounts reclassified from AOCI — — 59 59 Subtotal (50,015) — 821 (49,194) Tax effect 10,314 — (173) 10,141 OCI, net of tax (39,701) — 648 (39,053) Balance, December 31, 2022 $ (35,828) $ — $ (1,366) $ (37,194) A summary of the components of unrealized gains on AFS securities included in OCI follows for the years ended December 31: 2022 2021 2020 Auction Rate Money Market Preferred Stocks All Other AFS Securities Total Auction Rate Money Market Preferred Stocks All Other AFS Securities Total Auction Rate Money Market Preferred Stocks All Other AFS Securities Total Unrealized gains (losses) arising during the period $ (900) $ (49,115) $ (50,015) $ 5 $ (8,376) $ (8,371) $ 118 $ 7,356 $ 7,474 Reclassification adjustment for net (gains) losses included in net income — — — — — — — (71) (71) Net unrealized gains (losses) (900) (49,115) (50,015) 5 (8,376) (8,371) 118 7,285 7,403 Tax effect — 10,314 10,314 — 1,759 1,759 — (1,530) (1,530) Unrealized gains (losses), net of tax $ (900) $ (38,801) $ (39,701) $ 5 $ (6,617) $ (6,612) $ 118 $ 5,755 $ 5,873 |
Details about accumulated other comprehensive income components | The following table details reclassification adjustments and the related affected line items in our consolidated statements of income for the years ended December 31: Details about AOCI components Amount Affected Line Item in the 2022 2021 2020 Unrealized gains (losses) on AFS securities $ — $ — $ 71 Net gains on sale of AFS securities — — 15 Federal income tax expense $ — $ — $ 56 Net income Change in unrecognized pension cost on defined benefit pension plan $ 59 $ (31) $ 176 Other noninterest expenses 12 (7) 37 Federal income tax (benefit) expense $ 47 $ (24) $ 139 Net income |
Fair Value (Tables)
Fair Value (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Fair Value Disclosures [Abstract] | |
Quantitative information about assets measured utilizing Level 3 fair value measurement | The following tables list the quantitative fair value information about impaired loans as of: December 31, 2022 Valuation Technique Fair Value Unobservable Input Actual Range Weighted Average Discount applied to collateral: Real Estate 20% - 30% 24% Equipment 25% - 35% 31% Discounted value $17,143 Cash crop inventory 40% 40% Livestock 30% 30% Accounts receivable 25% 27% Furniture, fixtures & equipment 45% 45% December 31, 2021 Valuation Technique Fair Value Unobservable Input Actual Range Weighted Average Discount applied to collateral: Real Estate 20% - 30% 23% Equipment 20% - 35% 28% Discounted value $18,812 Cash crop inventory 40% 40% Livestock 30% 30% Accounts receivable 50% 50% Liquor license 75% 75% |
Carrying amount and estimated fair value of financial instruments not recorded at fair value | The carrying amount and estimated fair value of financial instruments not recorded at fair value in their entirety on a recurring basis were as follows as of December 31: 2022 Carrying Estimated Level 1 Level 2 Level 3 ASSETS Cash and cash equivalents $ 38,924 $ 38,924 $ 38,924 $ — $ — Mortgage loans AFS 379 395 — 395 — Gross loans 1,264,173 1,225,669 — — 1,225,669 Less allowance for loan and lease losses 9,850 9,850 — — 9,850 Net loans 1,254,323 1,215,819 — — 1,215,819 Accrued interest receivable 7,472 7,472 7,472 — — Equity securities without readily determinable fair values (1) 15,746 N/A — — — OMSR 2,559 3,174 — 3,174 — LIABILITIES Deposits without stated maturities 1,492,235 1,492,235 1,492,235 — — Deposits with stated maturities 252,040 240,964 — 240,964 — Federal funds purchased and repurchase agreements 57,771 57,581 — 57,581 — Subordinated debt, net of unamortized issuance costs 29,245 26,365 — 26,365 — Accrued interest payable 255 255 255 — — 2021 Carrying Estimated Level 1 Level 2 Level 3 ASSETS Cash and cash equivalents $ 105,330 $ 105,330 $ 105,330 $ — $ — Mortgage loans AFS 1,735 1,797 — 1,797 — Gross loans 1,301,037 1,296,841 — — 1,296,841 Less allowance for loan and lease losses 9,103 9,103 — — 9,103 Net loans 1,291,934 1,287,738 — — 1,287,738 Accrued interest receivable 5,804 5,804 5,804 — — Equity securities without readily determinable fair values (1) 17,383 N/A — — — OMSR 2,124 2,753 — 2,753 — LIABILITIES Deposits without stated maturities 1,409,577 1,409,577 1,409,577 — — Deposits with stated maturities 300,762 301,216 — 301,216 — Federal funds purchased and repurchase agreements 50,162 50,153 — 50,153 — FHLB advances 20,000 20,120 — 20,120 — Subordinated debt, net of unamortized issuance costs 29,158 27,435 — 27,435 — Accrued interest payable 251 251 251 — — |
Assets and liabilities measured at fair value | The table below presents the recorded amount of assets and liabilities measured at fair value on December 31: 2022 2021 Total Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Recurring items AFS securities U.S. Treasury $ 208,701 $ — $ 208,701 $ — $ 209,703 $ — $ 209,703 $ — States and political subdivisions 117,512 — 117,512 — 121,205 — 121,205 — Auction rate money market preferred 2,342 — 2,342 — 3,242 — 3,242 — Mortgage-backed securities 39,070 — 39,070 — 56,148 — 56,148 — Collateralized mortgage obligations 205,728 — 205,728 — 92,301 — 92,301 — Corporate 7,128 — 7,128 — 8,002 — 8,002 — Total AFS securities 580,481 — 580,481 — 490,601 — 490,601 — Nonrecurring items Impaired loans (net of the ALLL) 17,143 — — 17,143 18,812 — — 18,812 Foreclosed assets 439 — — 439 211 — — 211 Total $ 598,063 $ — $ 580,481 $ 17,582 $ 509,624 $ — $ 490,601 $ 19,023 Percent of assets and liabilities measured at fair value 0.00 % 97.06 % 2.94 % 0.00 % 96.27 % 3.73 % |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Related Party Transactions [Abstract] | |
Schedule of related party transactions | Annual activity consisted of the following for the years ended December 31: 2022 2021 Balance, January 1 $ 22,558 $ 2,977 New loans 1,829 43,264 Repayments (3,424) (23,683) Balance, December 31 $ 20,963 $ 22,558 The following table displays total assets of, and our donations to, the Foundation as of, and for the years ended December 31: 2022 2021 2020 Total assets $ 1,385 $ 1,511 $ 1,286 Donations $ 50 $ 50 $ — |
Parent Company Only Financial_2
Parent Company Only Financial Information (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Condensed Financial Information Disclosure [Abstract] | |
Interim Condensed Balance Sheets | Condensed Balance Sheets December 31 2022 2021 ASSETS Cash on deposit at the Bank $ 8,525 $ 11,535 Investments in subsidiaries 158,125 178,395 Premises and equipment 1,171 1,482 Other assets 47,922 48,923 TOTAL ASSETS $ 215,743 $ 240,335 LIABILITIES AND SHAREHOLDERS’ EQUITY Subordinated debt, net of unamortized issuance costs $ 29,245 $ 29,158 Other liabilities 288 129 Shareholders' equity 186,210 211,048 TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY $ 215,743 $ 240,335 |
Interim Condensed Statements of Income | Condensed Statements of Income Year Ended December 31 2022 2021 2020 Income Dividends from subsidiaries $ 6,000 $ 3,600 $ 9,300 Interest income 15 12 1 Net income on CSS joint venture — — 577 Other income 14 17 — Total income 6,029 3,629 9,878 Expenses Interest expense 1,065 615 5 Occupancy and equipment 67 67 61 Audit, consulting, and legal fees 522 590 573 Director fees 417 352 356 Other 1,172 1,145 1,167 Total expenses 3,243 2,769 2,162 Income before income tax benefit and equity in undistributed earnings of subsidiaries 2,786 860 7,716 Federal income tax benefit 670 500 216 Income before equity in undistributed earnings of subsidiaries 3,456 1,360 7,932 Undistributed earnings of subsidiaries 18,782 18,139 2,953 Net income $ 22,238 $ 19,499 $ 10,885 |
Interim Condensed Statements of Cash Flows | Condensed Statements of Cash Flows Year Ended December 31 2022 2021 2020 Operating activities Net income $ 22,238 $ 19,499 $ 10,885 Adjustments to reconcile net income to cash provided by operations Undistributed earnings of subsidiaries (18,782) (18,139) (2,953) Undistributed earnings of equity securities without readily determinable fair values — — (394) Loss on sale of joint venture investment — — 394 Share-based payment awards under the Directors Plan 463 433 413 Share-based payment awards under the RSP 147 86 14 Amortization of subordinated debt issuance costs 87 52 — Depreciation 50 50 47 Deferred income tax expense (benefit) (133) (267) 351 Changes in operating assets and liabilities which provided (used) cash Other assets 1,383 (304) 183 Other liabilities 160 70 40 Net cash provided by (used in) operating activities 5,613 1,480 8,980 Investing activities Purchase of equity investments (250) — — Sale of joint venture investment — — 1,000 Net sales (purchases) of premises and equipment 260 (2) (37) Net cash provided by (used in) investing activities 10 (2) 963 Financing activities Issuance of subordinated debt, net of unamortized issuance costs — 29,106 — Cash dividends paid on common stock (8,082) (8,367) (8,524) Proceeds from the issuance of common stock 1,762 1,593 4,185 Common stock repurchased (1,124) (13,758) (2,702) Common stock purchased for deferred compensation obligations (1,189) (1,187) (1,592) Net cash provided by (used in) financing activities (8,633) 7,387 (8,633) Increase (decrease) in cash and cash equivalents (3,010) 8,865 1,310 Cash and cash equivalents at beginning of period 11,535 2,670 1,360 Cash and cash equivalents at end of period $ 8,525 $ 11,535 $ 2,670 |
Nature of Operations and Summ_4
Nature of Operations and Summary of Significant Accounting Policies (Equity Securities) (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Accounting Policies [Abstract] | ||
FHLB Stock | $ 12,762 | $ 15,050 |
FRB Stock | 2,400 | 1,999 |
Other | 584 | 334 |
Total | $ 15,746 | $ 17,383 |
Nature of Operations and Summ_5
Nature of Operations and Summary of Significant Accounting Policies (Narrative) (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 USD ($) Location shares | Dec. 31, 2021 USD ($) shares | Dec. 31, 2020 USD ($) | |
Accounting Policies [Abstract] | |||
Other Real Estate, Foreclosed Assets, and Repossessed Assets | $ 439 | $ 211 | |
Number of location of banking operations | Location | 29 | ||
Period for federal fund sold | 1 day | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Unpaid principal balance of mortgages serviced for others | $ 264,206 | 278,844 | |
Capitalized mortgage loans on real estate carrying amount | 2,559 | 2,124 | |
Corporation recorded servicing fee revenue | 669 | 747 | $ 625 |
Deferred Compensation Arrangement with Individual, Share-based Payments [Line Items] | |||
Present value of the post retirement benefits payable | 2,905 | 2,843 | |
Periodic policy maintenance costs | $ 61 | $ 33 | $ 87 |
Director [Member] | |||
Deferred Compensation Arrangement with Individual, Share-based Payments [Line Items] | |||
Eligible shares, total | shares | 207,840 | 189,364 | |
Common stock, shares held in Rabbi Trust | shares | 154,879 | 105,654 | |
Minimum [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Useful lives of the related assets | 3 years | ||
Maximum [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Useful lives of the related assets | 40 years | ||
Commercial, Agricultural, and Residential Portfolio Segments [Member] | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Number of days past due (or more), accrual of interest discontinued | 90 days | ||
Consumer [Member] | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Maximum days of consumer loan charged off | 180 days |
AFS Securities (Amortized cost
AFS Securities (Amortized cost and fair value of AFS securities, with gross unrealized gains and losses) (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Debt Securities, Available-for-sale [Line Items] | ||
Debt Securities, Available-for-sale, Amortized Cost | $ 625,605 | $ 485,710 |
Debt Securities, Available-for-sale, Accumulated Gross Unrealized Gain, before Tax | 392 | 7,832 |
Debt Securities, Available-for-sale, Accumulated Gross Unrealized Loss, before Tax | 45,516 | 2,941 |
Debt Securities, Available-for-sale | 580,481 | 490,601 |
States and political subdivisions [Member] | ||
Debt Securities, Available-for-sale [Line Items] | ||
Debt Securities, Available-for-sale, Amortized Cost | 122,023 | 116,836 |
Debt Securities, Available-for-sale, Accumulated Gross Unrealized Gain, before Tax | 392 | 4,457 |
Debt Securities, Available-for-sale, Accumulated Gross Unrealized Loss, before Tax | 4,903 | 88 |
Debt Securities, Available-for-sale | 117,512 | 121,205 |
Auction rate money market preferred [Member] | ||
Debt Securities, Available-for-sale [Line Items] | ||
Debt Securities, Available-for-sale, Amortized Cost | 3,200 | 3,200 |
Debt Securities, Available-for-sale, Accumulated Gross Unrealized Gain, before Tax | 0 | 42 |
Debt Securities, Available-for-sale, Accumulated Gross Unrealized Loss, before Tax | 858 | 0 |
Debt Securities, Available-for-sale | 2,342 | 3,242 |
Mortgage-backed securities [Member] | ||
Debt Securities, Available-for-sale [Line Items] | ||
Debt Securities, Available-for-sale, Amortized Cost | 42,309 | 54,710 |
Debt Securities, Available-for-sale, Accumulated Gross Unrealized Gain, before Tax | 0 | 1,438 |
Debt Securities, Available-for-sale, Accumulated Gross Unrealized Loss, before Tax | 3,239 | 0 |
Debt Securities, Available-for-sale | 39,070 | 56,148 |
Collateralized mortgage obligations [Member] | ||
Debt Securities, Available-for-sale [Line Items] | ||
Debt Securities, Available-for-sale, Amortized Cost | 218,301 | 90,435 |
Debt Securities, Available-for-sale, Accumulated Gross Unrealized Gain, before Tax | 0 | 1,876 |
Debt Securities, Available-for-sale, Accumulated Gross Unrealized Loss, before Tax | 12,573 | 10 |
Debt Securities, Available-for-sale | 205,728 | 92,301 |
Corporate Debt Securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Debt Securities, Available-for-sale, Amortized Cost | 8,150 | 8,150 |
Debt Securities, Available-for-sale, Accumulated Gross Unrealized Gain, before Tax | 0 | 19 |
Debt Securities, Available-for-sale, Accumulated Gross Unrealized Loss, before Tax | 1,022 | 167 |
Debt Securities, Available-for-sale | 7,128 | 8,002 |
US Treasury Securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Debt Securities, Available-for-sale, Amortized Cost | 231,622 | 212,379 |
Debt Securities, Available-for-sale, Accumulated Gross Unrealized Gain, before Tax | 0 | 0 |
Debt Securities, Available-for-sale, Accumulated Gross Unrealized Loss, before Tax | 22,921 | 2,676 |
Debt Securities, Available-for-sale | $ 208,701 | $ 209,703 |
AFS Securities (Amortized cos_2
AFS Securities (Amortized cost and fair value of AFS securities by contractual maturity) (Details) $ in Thousands | Dec. 31, 2022 USD ($) |
Debt Securities, Available-for-sale, Maturity, Amortized Cost, Rolling Maturity [Abstract] | |
Maturing, Due in One Year or Less | $ 19,753 |
Maturing, After One Year But Within Five Years | 274,568 |
Maturing, After Five Years But Within Ten Years | 29,384 |
Maturing, After Ten Years | 38,090 |
Securities With Variable Monthly Payments or Noncontractual Maturities | 263,810 |
Debt Securities, Available-for-sale, Maturity, Fair Value, Rolling Maturity [Abstract] | |
Maturing, Due in One Year or Less, Fair value | 19,666 |
Maturing, After One Year But Within Five Years, Fair value | 251,479 |
Maturing, After Five Years But Within Ten Years, Fair value | 27,703 |
Maturing, After Ten Years, Fair value | 34,493 |
Securities With Variable Monthly Payments or Noncontractual Maturities, Fair value | 247,140 |
States and political subdivisions [Member] | |
Debt Securities, Available-for-sale, Maturity, Amortized Cost, Rolling Maturity [Abstract] | |
Maturing, Due in One Year or Less | 19,753 |
Maturing, After One Year But Within Five Years | 42,946 |
Maturing, After Five Years But Within Ten Years | 21,234 |
Maturing, After Ten Years | 38,090 |
Securities With Variable Monthly Payments or Noncontractual Maturities | 0 |
Auction rate money market preferred [Member] | |
Debt Securities, Available-for-sale, Maturity, Amortized Cost, Rolling Maturity [Abstract] | |
Maturing, Due in One Year or Less | 0 |
Maturing, After One Year But Within Five Years | 0 |
Maturing, After Five Years But Within Ten Years | 0 |
Maturing, After Ten Years | 0 |
Securities With Variable Monthly Payments or Noncontractual Maturities | 3,200 |
Mortgage-backed securities [Member] | |
Debt Securities, Available-for-sale, Maturity, Amortized Cost, Rolling Maturity [Abstract] | |
Maturing, Due in One Year or Less | 0 |
Maturing, After One Year But Within Five Years | 0 |
Maturing, After Five Years But Within Ten Years | 0 |
Maturing, After Ten Years | 0 |
Securities With Variable Monthly Payments or Noncontractual Maturities | 42,309 |
Collateralized mortgage obligations [Member] | |
Debt Securities, Available-for-sale, Maturity, Amortized Cost, Rolling Maturity [Abstract] | |
Maturing, Due in One Year or Less | 0 |
Maturing, After One Year But Within Five Years | 0 |
Maturing, After Five Years But Within Ten Years | 0 |
Maturing, After Ten Years | 0 |
Securities With Variable Monthly Payments or Noncontractual Maturities | 218,301 |
Corporate Debt Securities | |
Debt Securities, Available-for-sale, Maturity, Amortized Cost, Rolling Maturity [Abstract] | |
Maturing, Due in One Year or Less | 0 |
Maturing, After One Year But Within Five Years | 0 |
Maturing, After Five Years But Within Ten Years | 8,150 |
Maturing, After Ten Years | 0 |
Securities With Variable Monthly Payments or Noncontractual Maturities | 0 |
US Treasury Securities | |
Debt Securities, Available-for-sale, Maturity, Amortized Cost, Rolling Maturity [Abstract] | |
Maturing, Due in One Year or Less | 0 |
Maturing, After One Year But Within Five Years | 231,622 |
Maturing, After Five Years But Within Ten Years | 0 |
Maturing, After Ten Years | 0 |
Securities With Variable Monthly Payments or Noncontractual Maturities | $ 0 |
AFS Securities (Activity relate
AFS Securities (Activity related to sales of AFS securities) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Investments, Debt and Equity Securities [Abstract] | |||
Proceeds from sales of AFS of securities | $ 0 | $ 0 | $ 26,855 |
Applicable income tax expense | 0 | 0 | 15 |
Debt Securities, Realized Gain (Loss) | $ 0 | $ 0 | $ 71 |
AFS Securities (AFS securities
AFS Securities (AFS securities with gross unrealized losses) (Details) $ in Thousands | Dec. 31, 2022 USD ($) Securities | Dec. 31, 2021 USD ($) Securities |
Debt Securities, Available-for-sale [Line Items] | ||
Gross Unrealized Losses, Less Than Twelve Months | $ 19,424 | $ 2,941 |
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, Less than 12 Months | 306,799 | 236,825 |
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, 12 Months or Longer, Accumulated Loss | 26,092 | 0 |
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, 12 Months or Longer | 244,917 | 0 |
Total Unrealized Losses | $ 45,516 | $ 2,941 |
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, 12 Months or Longer, Number of Positions | Securities | 266 | 0 |
Debt Securities, Available-for-sale, Unrealized Loss Position, Number of Positions | Securities | 444 | 40 |
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, Less than 12 Months, Number of Positions | Securities | 178 | 40 |
States and political subdivisions [Member] | ||
Debt Securities, Available-for-sale [Line Items] | ||
Gross Unrealized Losses, Less Than Twelve Months | $ 2,389 | $ 88 |
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, Less than 12 Months | 48,083 | 9,674 |
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, 12 Months or Longer, Accumulated Loss | 2,514 | 0 |
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, 12 Months or Longer | 40,667 | 0 |
Total Unrealized Losses | 4,903 | 88 |
Collateralized mortgage obligations [Member] | ||
Debt Securities, Available-for-sale [Line Items] | ||
Gross Unrealized Losses, Less Than Twelve Months | 12,408 | 10 |
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, Less than 12 Months | 201,316 | 11,165 |
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, 12 Months or Longer, Accumulated Loss | 165 | 0 |
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, 12 Months or Longer | 4,411 | 0 |
Total Unrealized Losses | 12,573 | 10 |
US Treasury Securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Gross Unrealized Losses, Less Than Twelve Months | 1,388 | 2,676 |
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, Less than 12 Months | 18,331 | 209,703 |
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, 12 Months or Longer, Accumulated Loss | 21,533 | 0 |
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, 12 Months or Longer | 190,369 | 0 |
Total Unrealized Losses | 22,921 | 2,676 |
Corporate Debt Securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Gross Unrealized Losses, Less Than Twelve Months | 0 | 167 |
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, Less than 12 Months | 0 | 6,283 |
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, 12 Months or Longer, Accumulated Loss | 1,022 | 0 |
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, 12 Months or Longer | 7,128 | 0 |
Total Unrealized Losses | 1,022 | $ 167 |
Auction Rate Preferred Securities [Member] | ||
Debt Securities, Available-for-sale [Line Items] | ||
Gross Unrealized Losses, Less Than Twelve Months | 0 | |
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, Less than 12 Months | 0 | |
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, 12 Months or Longer, Accumulated Loss | 858 | |
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, 12 Months or Longer | 2,342 | |
Total Unrealized Losses | 858 | |
Collateralized Mortgage Backed Securities [Member] | ||
Debt Securities, Available-for-sale [Line Items] | ||
Gross Unrealized Losses, Less Than Twelve Months | 3,239 | |
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, Less than 12 Months | 39,069 | |
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, 12 Months or Longer, Accumulated Loss | 0 | |
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, 12 Months or Longer | 0 | |
Total Unrealized Losses | $ 3,239 |
Loans and ALLL (Summary of chan
Loans and ALLL (Summary of changes in ALLL by segments) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Financing Receivable, Allowance for Credit Losses [Line Items] | |||
Loans and Leases Receivable, Allowance | $ 9,850 | $ 9,103 | |
Summary of changes in the ALLL and the recorded investment in loans by segments | |||
Allowance for loan losses, Beginning Balance | 9,103 | 9,744 | |
Allowance for loan losses, Charge-offs | (619) | (607) | |
Allowance for loan losses, Recoveries | 883 | 484 | |
Allowance for loan losses, Provision for loan losses | 483 | (518) | $ 1,665 |
Allowance for loan losses, Ending Balance | 9,850 | 9,103 | 9,744 |
Commercial [Member] | |||
Summary of changes in the ALLL and the recorded investment in loans by segments | |||
Allowance for loan losses, Beginning Balance | 1,740 | 2,162 | |
Allowance for loan losses, Charge-offs | (77) | (32) | |
Allowance for loan losses, Recoveries | 442 | 133 | |
Allowance for loan losses, Provision for loan losses | (784) | (523) | |
Allowance for loan losses, Ending Balance | 1,321 | 1,740 | 2,162 |
Agricultural [Member] | |||
Summary of changes in the ALLL and the recorded investment in loans by segments | |||
Allowance for loan losses, Beginning Balance | 289 | 311 | |
Allowance for loan losses, Charge-offs | 0 | (77) | |
Allowance for loan losses, Recoveries | 9 | 12 | |
Allowance for loan losses, Provision for loan losses | 279 | 43 | |
Allowance for loan losses, Ending Balance | 577 | 289 | 311 |
Residential Real Estate [Member] | |||
Summary of changes in the ALLL and the recorded investment in loans by segments | |||
Allowance for loan losses, Beginning Balance | 747 | 1,363 | |
Allowance for loan losses, Charge-offs | 0 | (12) | |
Allowance for loan losses, Recoveries | 150 | 162 | |
Allowance for loan losses, Provision for loan losses | (280) | (766) | |
Allowance for loan losses, Ending Balance | 617 | 747 | 1,363 |
Consumer [Member] | |||
Summary of changes in the ALLL and the recorded investment in loans by segments | |||
Allowance for loan losses, Beginning Balance | 908 | 798 | |
Allowance for loan losses, Charge-offs | (542) | (486) | |
Allowance for loan losses, Recoveries | 282 | 177 | |
Allowance for loan losses, Provision for loan losses | 313 | 419 | |
Allowance for loan losses, Ending Balance | 961 | 908 | 798 |
Unallocated [Member] | |||
Summary of changes in the ALLL and the recorded investment in loans by segments | |||
Allowance for loan losses, Beginning Balance | 5,419 | 5,110 | |
Allowance for loan losses, Charge-offs | 0 | 0 | |
Allowance for loan losses, Recoveries | 0 | 0 | |
Allowance for loan losses, Provision for loan losses | 955 | 309 | |
Allowance for loan losses, Ending Balance | $ 6,374 | $ 5,419 | $ 5,110 |
Loans and ALLL (Summary of reco
Loans and ALLL (Summary of recorded investment in loans by segments) (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Financing Receivable, Allowance for Credit Losses [Line Items] | |||
Individually evaluated for impairment, ALLL | $ 451 | $ 578 | |
Collectively evaluated for impairment, ALLL | 9,399 | 8,525 | |
Total, ALLL | 9,850 | 9,103 | $ 9,744 |
Individually evaluated for impairment, Loans | 22,018 | 26,910 | |
Collectively evaluated for impairment, Loans | 1,242,155 | 1,274,127 | |
Total | 1,264,173 | 1,301,037 | |
Commercial [Member] | |||
Financing Receivable, Allowance for Credit Losses [Line Items] | |||
Individually evaluated for impairment, ALLL | 12 | 13 | |
Collectively evaluated for impairment, ALLL | 1,309 | 1,727 | |
Total, ALLL | 1,321 | 1,740 | 2,162 |
Individually evaluated for impairment, Loans | 8,342 | 9,267 | |
Collectively evaluated for impairment, Loans | 732,578 | 798,172 | |
Total | 740,920 | 807,439 | |
Agricultural [Member] | |||
Financing Receivable, Allowance for Credit Losses [Line Items] | |||
Individually evaluated for impairment, ALLL | 0 | 0 | |
Collectively evaluated for impairment, ALLL | 577 | 289 | |
Total, ALLL | 577 | 289 | 311 |
Individually evaluated for impairment, Loans | 10,935 | 14,189 | |
Collectively evaluated for impairment, Loans | 93,379 | 79,766 | |
Total | 104,314 | 93,955 | |
Residential Real Estate [Member] | |||
Financing Receivable, Allowance for Credit Losses [Line Items] | |||
Individually evaluated for impairment, ALLL | 439 | 565 | |
Collectively evaluated for impairment, ALLL | 178 | 182 | |
Total, ALLL | 617 | 747 | 1,363 |
Individually evaluated for impairment, Loans | 2,741 | 3,454 | |
Collectively evaluated for impairment, Loans | 338,144 | 322,907 | |
Total | 340,885 | 326,361 | |
Consumer [Member] | |||
Financing Receivable, Allowance for Credit Losses [Line Items] | |||
Individually evaluated for impairment, ALLL | 0 | 0 | |
Collectively evaluated for impairment, ALLL | 961 | 908 | |
Total, ALLL | 961 | 908 | 798 |
Individually evaluated for impairment, Loans | 0 | 0 | |
Collectively evaluated for impairment, Loans | 78,054 | 73,282 | |
Total | 78,054 | 73,282 | |
Unallocated [Member] | |||
Financing Receivable, Allowance for Credit Losses [Line Items] | |||
Individually evaluated for impairment, ALLL | 0 | 0 | |
Collectively evaluated for impairment, ALLL | 6,374 | 5,419 | |
Total, ALLL | $ 6,374 | $ 5,419 | $ 5,110 |
Loans and ALLL (Credit quality
Loans and ALLL (Credit quality indicators for commercial and agricultural credit exposures) (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Financing Receivable, Recorded Investment [Line Items] | ||
Total | $ 1,264,173 | $ 1,301,037 |
Total commercial [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 740,920 | 807,439 |
Commercial real estate [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 574,660 | 570,587 |
Commercial other [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 166,260 | 164,851 |
Commercial Advances to Mortgage Brokers Segment [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 0 | 72,001 |
Total agricultural [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 104,314 | 93,955 |
Agricultural real estate [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 72,331 | 66,144 |
Agricultural other [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 31,983 | 27,811 |
Commercial And Agricultural Portfolio Segment [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 845,234 | 901,394 |
1 - Excellent [Member] | Total commercial [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 0 | 300 |
1 - Excellent [Member] | Commercial real estate [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 0 | 0 |
1 - Excellent [Member] | Commercial other [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 0 | 300 |
1 - Excellent [Member] | Commercial Advances to Mortgage Brokers Segment [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 0 | 0 |
1 - Excellent [Member] | Total agricultural [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 0 | 0 |
1 - Excellent [Member] | Agricultural real estate [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 0 | 0 |
1 - Excellent [Member] | Agricultural other [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 0 | 0 |
1 - Excellent [Member] | Commercial And Agricultural Portfolio Segment [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 0 | 300 |
2 - High quality [Member] | Total commercial [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 13,578 | 15,891 |
2 - High quality [Member] | Commercial real estate [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 9,045 | 9,010 |
2 - High quality [Member] | Commercial other [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 4,533 | 6,881 |
2 - High quality [Member] | Commercial Advances to Mortgage Brokers Segment [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 0 | 0 |
2 - High quality [Member] | Total agricultural [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 442 | 453 |
2 - High quality [Member] | Agricultural real estate [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 342 | 453 |
2 - High quality [Member] | Agricultural other [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 100 | 0 |
2 - High quality [Member] | Commercial And Agricultural Portfolio Segment [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 14,020 | 16,344 |
3 - High satisfactory [Member] | Total commercial [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 104,741 | 204,223 |
3 - High satisfactory [Member] | Commercial real estate [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 68,133 | 86,135 |
3 - High satisfactory [Member] | Commercial other [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 36,608 | 46,087 |
3 - High satisfactory [Member] | Commercial Advances to Mortgage Brokers Segment [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 0 | 72,001 |
3 - High satisfactory [Member] | Total agricultural [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 14,365 | 13,656 |
3 - High satisfactory [Member] | Agricultural real estate [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 9,757 | 9,361 |
3 - High satisfactory [Member] | Agricultural other [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 4,608 | 4,295 |
3 - High satisfactory [Member] | Commercial And Agricultural Portfolio Segment [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 119,106 | 217,879 |
4 - Low satisfactory [Member] | Total commercial [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 585,574 | 552,864 |
4 - Low satisfactory [Member] | Commercial real estate [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 471,009 | 448,489 |
4 - Low satisfactory [Member] | Commercial other [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 114,565 | 104,375 |
4 - Low satisfactory [Member] | Commercial Advances to Mortgage Brokers Segment [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 0 | 0 |
4 - Low satisfactory [Member] | Total agricultural [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 64,801 | 52,469 |
4 - Low satisfactory [Member] | Agricultural real estate [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 43,587 | 36,483 |
4 - Low satisfactory [Member] | Agricultural other [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 21,214 | 15,986 |
4 - Low satisfactory [Member] | Commercial And Agricultural Portfolio Segment [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 650,375 | 605,333 |
5 - Special mention [Member] | Total commercial [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 28,217 | 14,563 |
5 - Special mention [Member] | Commercial real estate [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 20,770 | 13,212 |
5 - Special mention [Member] | Commercial other [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 7,447 | 1,351 |
5 - Special mention [Member] | Commercial Advances to Mortgage Brokers Segment [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 0 | 0 |
5 - Special mention [Member] | Total agricultural [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 16,896 | 16,548 |
5 - Special mention [Member] | Agricultural real estate [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 12,262 | 13,096 |
5 - Special mention [Member] | Agricultural other [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 4,634 | 3,452 |
5 - Special mention [Member] | Commercial And Agricultural Portfolio Segment [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 45,113 | 31,111 |
6 - Substandard [Member] | Total commercial [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 8,714 | 19,257 |
6 - Substandard [Member] | Commercial real estate [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 5,629 | 13,519 |
6 - Substandard [Member] | Commercial other [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 3,085 | 5,738 |
6 - Substandard [Member] | Commercial Advances to Mortgage Brokers Segment [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 0 | 0 |
6 - Substandard [Member] | Total agricultural [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 7,576 | 10,055 |
6 - Substandard [Member] | Agricultural real estate [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 6,316 | 6,252 |
6 - Substandard [Member] | Agricultural other [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 1,260 | 3,803 |
6 - Substandard [Member] | Commercial And Agricultural Portfolio Segment [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 16,290 | 29,312 |
7 - Vulnerable [Member] | Total commercial [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 96 | 341 |
7 - Vulnerable [Member] | Commercial real estate [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 74 | 222 |
7 - Vulnerable [Member] | Commercial other [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 22 | 119 |
7 - Vulnerable [Member] | Commercial Advances to Mortgage Brokers Segment [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 0 | 0 |
7 - Vulnerable [Member] | Total agricultural [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 234 | 774 |
7 - Vulnerable [Member] | Agricultural real estate [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 67 | 499 |
7 - Vulnerable [Member] | Agricultural other [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 167 | 275 |
7 - Vulnerable [Member] | Commercial And Agricultural Portfolio Segment [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 330 | 1,115 |
8 - Doubtful [Member] | Total commercial [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 0 | 0 |
8 - Doubtful [Member] | Commercial real estate [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 0 | 0 |
8 - Doubtful [Member] | Commercial other [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 0 | 0 |
8 - Doubtful [Member] | Commercial Advances to Mortgage Brokers Segment [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 0 | 0 |
8 - Doubtful [Member] | Total agricultural [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 0 | 0 |
8 - Doubtful [Member] | Agricultural real estate [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 0 | 0 |
8 - Doubtful [Member] | Agricultural other [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 0 | 0 |
8 - Doubtful [Member] | Commercial And Agricultural Portfolio Segment [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 0 | 0 |
Loss [Member] | Total commercial [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 0 | 0 |
Loss [Member] | Commercial real estate [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 0 | 0 |
Loss [Member] | Commercial other [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 0 | 0 |
Loss [Member] | Commercial Advances to Mortgage Brokers Segment [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 0 | 0 |
Loss [Member] | Total agricultural [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 0 | 0 |
Loss [Member] | Agricultural real estate [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 0 | 0 |
Loss [Member] | Agricultural other [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 0 | 0 |
Loss [Member] | Commercial And Agricultural Portfolio Segment [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | $ 0 | $ 0 |
Loans and ALLL (Past due and cu
Loans and ALLL (Past due and current loans) (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Financing Receivable, Recorded Investment, 90 Days Past Due and Still Accruing | $ 0 | $ 97 |
Nonaccrual | 457 | 1,245 |
Total Past Due and Nonaccrual | 11,130 | 4,031 |
Total | 1,264,173 | 1,301,037 |
Total commercial [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Financing Receivable, Recorded Investment, 90 Days Past Due and Still Accruing | 0 | 0 |
Nonaccrual | 96 | 341 |
Total Past Due and Nonaccrual | 7,504 | 561 |
Total | 740,920 | 807,439 |
Commercial real estate [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Financing Receivable, Recorded Investment, 90 Days Past Due and Still Accruing | 0 | 0 |
Nonaccrual | 74 | 222 |
Total Past Due and Nonaccrual | 7,197 | 357 |
Total | 574,660 | 570,587 |
Commercial other [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Financing Receivable, Recorded Investment, 90 Days Past Due and Still Accruing | 0 | 0 |
Nonaccrual | 22 | 119 |
Total Past Due and Nonaccrual | 307 | 204 |
Total | 166,260 | 164,851 |
Commercial Advances to Mortgage Brokers Segment [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Financing Receivable, Recorded Investment, 90 Days Past Due and Still Accruing | 0 | 0 |
Nonaccrual | 0 | 0 |
Total Past Due and Nonaccrual | 0 | 0 |
Total | 0 | 72,001 |
Total agricultural [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Financing Receivable, Recorded Investment, 90 Days Past Due and Still Accruing | 0 | 0 |
Nonaccrual | 234 | 774 |
Total Past Due and Nonaccrual | 234 | 987 |
Total | 104,314 | 93,955 |
Agricultural real estate [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Financing Receivable, Recorded Investment, 90 Days Past Due and Still Accruing | 0 | 0 |
Nonaccrual | 67 | 499 |
Total Past Due and Nonaccrual | 67 | 712 |
Total | 72,331 | 66,144 |
Agricultural other [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Financing Receivable, Recorded Investment, 90 Days Past Due and Still Accruing | 0 | 0 |
Nonaccrual | 167 | 275 |
Total Past Due and Nonaccrual | 167 | 275 |
Total | 31,983 | 27,811 |
Total residential real estate [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Financing Receivable, Recorded Investment, 90 Days Past Due and Still Accruing | 0 | 97 |
Nonaccrual | 127 | 130 |
Total Past Due and Nonaccrual | 3,333 | 2,287 |
Total | 340,885 | 326,361 |
Residential real estate senior liens [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Financing Receivable, Recorded Investment, 90 Days Past Due and Still Accruing | 0 | 97 |
Nonaccrual | 127 | 93 |
Total Past Due and Nonaccrual | 3,295 | 2,243 |
Total | 304,901 | 293,143 |
Residential real estate junior liens [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Financing Receivable, Recorded Investment, 90 Days Past Due and Still Accruing | 0 | 0 |
Nonaccrual | 0 | 0 |
Total Past Due and Nonaccrual | 0 | 0 |
Total | 3,282 | 2,439 |
Residential real estate home equity lines of credit [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Financing Receivable, Recorded Investment, 90 Days Past Due and Still Accruing | 0 | 0 |
Nonaccrual | 0 | 37 |
Total Past Due and Nonaccrual | 38 | 44 |
Total | 32,702 | 30,779 |
Total consumer [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Financing Receivable, Recorded Investment, 90 Days Past Due and Still Accruing | 0 | 0 |
Nonaccrual | 0 | 0 |
Total Past Due and Nonaccrual | 59 | 196 |
Total | 78,054 | 73,282 |
Consumer secured [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Financing Receivable, Recorded Investment, 90 Days Past Due and Still Accruing | 0 | 0 |
Nonaccrual | 0 | 0 |
Total Past Due and Nonaccrual | 55 | 186 |
Total | 74,941 | 70,445 |
Consumer unsecured [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Financing Receivable, Recorded Investment, 90 Days Past Due and Still Accruing | 0 | 0 |
Nonaccrual | 0 | 0 |
Total Past Due and Nonaccrual | 4 | 10 |
Total | 3,113 | 2,837 |
Financing Receivables, 30 to 59 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total | 7,870 | 2,652 |
Financing Receivables, 30 to 59 Days Past Due [Member] | Total commercial [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total | 4,838 | 220 |
Financing Receivables, 30 to 59 Days Past Due [Member] | Commercial real estate [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total | 4,553 | 135 |
Financing Receivables, 30 to 59 Days Past Due [Member] | Commercial other [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total | 285 | 85 |
Financing Receivables, 30 to 59 Days Past Due [Member] | Commercial Advances to Mortgage Brokers Segment [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total | 0 | 0 |
Financing Receivables, 30 to 59 Days Past Due [Member] | Total agricultural [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total | 0 | 213 |
Financing Receivables, 30 to 59 Days Past Due [Member] | Agricultural real estate [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total | 0 | 213 |
Financing Receivables, 30 to 59 Days Past Due [Member] | Agricultural other [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total | 0 | 0 |
Financing Receivables, 30 to 59 Days Past Due [Member] | Total residential real estate [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total | 2,981 | 2,023 |
Financing Receivables, 30 to 59 Days Past Due [Member] | Residential real estate senior liens [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total | 2,943 | 2,016 |
Financing Receivables, 30 to 59 Days Past Due [Member] | Residential real estate junior liens [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total | 0 | 0 |
Financing Receivables, 30 to 59 Days Past Due [Member] | Residential real estate home equity lines of credit [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total | 38 | 7 |
Financing Receivables, 30 to 59 Days Past Due [Member] | Total consumer [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total | 51 | 196 |
Financing Receivables, 30 to 59 Days Past Due [Member] | Consumer secured [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total | 47 | 186 |
Financing Receivables, 30 to 59 Days Past Due [Member] | Consumer unsecured [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total | 4 | 10 |
Financing Receivables, 60 to 89 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total | 2,803 | 37 |
Financing Receivables, 60 to 89 Days Past Due [Member] | Total commercial [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total | 2,570 | 0 |
Financing Receivables, 60 to 89 Days Past Due [Member] | Commercial real estate [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total | 2,570 | 0 |
Financing Receivables, 60 to 89 Days Past Due [Member] | Commercial other [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total | 0 | 0 |
Financing Receivables, 60 to 89 Days Past Due [Member] | Commercial Advances to Mortgage Brokers Segment [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total | 0 | 0 |
Financing Receivables, 60 to 89 Days Past Due [Member] | Total agricultural [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total | 0 | 0 |
Financing Receivables, 60 to 89 Days Past Due [Member] | Agricultural real estate [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total | 0 | 0 |
Financing Receivables, 60 to 89 Days Past Due [Member] | Agricultural other [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total | 0 | 0 |
Financing Receivables, 60 to 89 Days Past Due [Member] | Total residential real estate [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total | 225 | 37 |
Financing Receivables, 60 to 89 Days Past Due [Member] | Residential real estate senior liens [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total | 225 | 37 |
Financing Receivables, 60 to 89 Days Past Due [Member] | Residential real estate junior liens [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total | 0 | 0 |
Financing Receivables, 60 to 89 Days Past Due [Member] | Residential real estate home equity lines of credit [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total | 0 | 0 |
Financing Receivables, 60 to 89 Days Past Due [Member] | Total consumer [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total | 8 | 0 |
Financing Receivables, 60 to 89 Days Past Due [Member] | Consumer secured [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total | 8 | 0 |
Financing Receivables, 60 to 89 Days Past Due [Member] | Consumer unsecured [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total | 0 | 0 |
Financial Asset, Not Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total | 1,253,043 | 1,297,006 |
Financial Asset, Not Past Due | Total commercial [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total | 733,416 | 806,878 |
Financial Asset, Not Past Due | Commercial real estate [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total | 567,463 | 570,230 |
Financial Asset, Not Past Due | Commercial other [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total | 165,953 | 164,647 |
Financial Asset, Not Past Due | Commercial Advances to Mortgage Brokers Segment [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total | 0 | 72,001 |
Financial Asset, Not Past Due | Total agricultural [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total | 104,080 | 92,968 |
Financial Asset, Not Past Due | Agricultural real estate [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total | 72,264 | 65,432 |
Financial Asset, Not Past Due | Agricultural other [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total | 31,816 | 27,536 |
Financial Asset, Not Past Due | Total residential real estate [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total | 337,552 | 324,074 |
Financial Asset, Not Past Due | Residential real estate senior liens [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total | 301,606 | 290,900 |
Financial Asset, Not Past Due | Residential real estate junior liens [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total | 3,282 | 2,439 |
Financial Asset, Not Past Due | Residential real estate home equity lines of credit [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total | 32,664 | 30,735 |
Financial Asset, Not Past Due | Total consumer [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total | 77,995 | 73,086 |
Financial Asset, Not Past Due | Consumer secured [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total | 74,886 | 70,259 |
Financial Asset, Not Past Due | Consumer unsecured [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total | $ 3,109 | $ 2,827 |
Loans and ALLL (Summary of info
Loans and ALLL (Summary of information pertaining to impaired loans) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Impaired Financing Receivable, Recorded Investment [Abstract] | ||
Impaired loans with a valuation allowance, Outstanding Balance | $ 2,924 | $ 6,411 |
Impaired loans without a valuation allowance, Outstanding Balance | 19,094 | 20,499 |
Impaired loans, Outstanding Balance | 22,018 | 26,910 |
Impaired Financing Receivable, Unpaid Principal Balance [Abstract] | ||
Impaired loans with a valuation allowance, Unpaid Principal Balance | 3,185 | 6,683 |
Impaired loans without a valuation allowance, Unpaid Principal Balance | 19,410 | 20,815 |
Impaired loans, Unpaid Principal Balance | 22,595 | 27,498 |
Impaired loans, Valuation Allowance | 451 | 578 |
Impaired Financing Receivable, Average Recorded Investment [Abstract] | ||
Impaired loans with a valuation allowance, Average Outstanding Balance | 4,969 | 8,093 |
Impaired loans without a valuation allowance, Average Outstanding Balance | 17,697 | 22,289 |
Impaired loans, Average Outstanding Balance | 22,666 | 30,382 |
Impaired Financing Receivable, Interest Income, Accrual Method [Abstract] | ||
Impaired loans with a valuation allowance, Interest Income Recognized | 200 | 334 |
Impaired loans without a valuation allowance, Interest Income Recognized | 1,021 | 1,400 |
Impaired loans, Interest Income Recognized | 1,221 | 1,734 |
Total commercial [Member] | ||
Impaired Financing Receivable, Recorded Investment [Abstract] | ||
Impaired loans, Outstanding Balance | 8,342 | 9,267 |
Impaired Financing Receivable, Unpaid Principal Balance [Abstract] | ||
Impaired loans, Unpaid Principal Balance | 8,659 | 9,584 |
Impaired loans, Valuation Allowance | 12 | 13 |
Impaired Financing Receivable, Average Recorded Investment [Abstract] | ||
Impaired loans, Average Outstanding Balance | 8,053 | 11,853 |
Impaired Financing Receivable, Interest Income, Accrual Method [Abstract] | ||
Impaired loans, Interest Income Recognized | 470 | 638 |
Commercial real estate [Member] | ||
Impaired Financing Receivable, Recorded Investment [Abstract] | ||
Impaired loans with a valuation allowance, Outstanding Balance | 183 | 192 |
Impaired loans without a valuation allowance, Outstanding Balance | 5,366 | 5,829 |
Impaired Financing Receivable, Unpaid Principal Balance [Abstract] | ||
Impaired loans with a valuation allowance, Unpaid Principal Balance | 184 | 193 |
Impaired loans without a valuation allowance, Unpaid Principal Balance | 5,682 | 6,145 |
Impaired loans, Valuation Allowance | 12 | 9 |
Impaired Financing Receivable, Average Recorded Investment [Abstract] | ||
Impaired loans with a valuation allowance, Average Outstanding Balance | 189 | 1,668 |
Impaired loans without a valuation allowance, Average Outstanding Balance | 5,514 | 6,313 |
Impaired Financing Receivable, Interest Income, Accrual Method [Abstract] | ||
Impaired loans with a valuation allowance, Interest Income Recognized | 12 | 69 |
Impaired loans without a valuation allowance, Interest Income Recognized | 338 | 398 |
Commercial other [Member] | ||
Impaired Financing Receivable, Recorded Investment [Abstract] | ||
Impaired loans with a valuation allowance, Outstanding Balance | 0 | 2,802 |
Impaired loans without a valuation allowance, Outstanding Balance | 2,793 | 444 |
Impaired Financing Receivable, Unpaid Principal Balance [Abstract] | ||
Impaired loans with a valuation allowance, Unpaid Principal Balance | 0 | 2,802 |
Impaired loans without a valuation allowance, Unpaid Principal Balance | 2,793 | 444 |
Impaired loans, Valuation Allowance | 0 | 4 |
Impaired Financing Receivable, Average Recorded Investment [Abstract] | ||
Impaired loans with a valuation allowance, Average Outstanding Balance | 1,724 | 1,909 |
Impaired loans without a valuation allowance, Average Outstanding Balance | 626 | 1,963 |
Impaired Financing Receivable, Interest Income, Accrual Method [Abstract] | ||
Impaired loans with a valuation allowance, Interest Income Recognized | 62 | 103 |
Impaired loans without a valuation allowance, Interest Income Recognized | 58 | 68 |
Total agricultural [Member] | ||
Impaired Financing Receivable, Recorded Investment [Abstract] | ||
Impaired loans, Outstanding Balance | 10,935 | 14,189 |
Impaired Financing Receivable, Unpaid Principal Balance [Abstract] | ||
Impaired loans, Unpaid Principal Balance | 10,935 | 14,189 |
Impaired loans, Valuation Allowance | 0 | 0 |
Impaired Financing Receivable, Average Recorded Investment [Abstract] | ||
Impaired loans, Average Outstanding Balance | 11,552 | 14,730 |
Impaired Financing Receivable, Interest Income, Accrual Method [Abstract] | ||
Impaired loans, Interest Income Recognized | 625 | 945 |
Agricultural real estate [Member] | ||
Impaired Financing Receivable, Recorded Investment [Abstract] | ||
Impaired loans with a valuation allowance, Outstanding Balance | 0 | |
Impaired loans without a valuation allowance, Outstanding Balance | 8,522 | 9,538 |
Impaired Financing Receivable, Unpaid Principal Balance [Abstract] | ||
Impaired loans with a valuation allowance, Unpaid Principal Balance | 0 | |
Impaired loans without a valuation allowance, Unpaid Principal Balance | 8,522 | 9,538 |
Impaired loans, Valuation Allowance | 0 | |
Impaired Financing Receivable, Average Recorded Investment [Abstract] | ||
Impaired loans with a valuation allowance, Average Outstanding Balance | 553 | |
Impaired loans without a valuation allowance, Average Outstanding Balance | 8,568 | 9,739 |
Impaired Financing Receivable, Interest Income, Accrual Method [Abstract] | ||
Impaired loans with a valuation allowance, Interest Income Recognized | 11 | |
Impaired loans without a valuation allowance, Interest Income Recognized | 468 | 699 |
Agricultural other [Member] | ||
Impaired Financing Receivable, Recorded Investment [Abstract] | ||
Impaired loans with a valuation allowance, Outstanding Balance | 0 | |
Impaired loans without a valuation allowance, Outstanding Balance | 2,413 | 4,651 |
Impaired Financing Receivable, Unpaid Principal Balance [Abstract] | ||
Impaired loans with a valuation allowance, Unpaid Principal Balance | 0 | |
Impaired loans without a valuation allowance, Unpaid Principal Balance | 2,413 | 4,651 |
Impaired loans, Valuation Allowance | 0 | |
Impaired Financing Receivable, Average Recorded Investment [Abstract] | ||
Impaired loans with a valuation allowance, Average Outstanding Balance | 169 | |
Impaired loans without a valuation allowance, Average Outstanding Balance | 2,984 | 4,269 |
Impaired Financing Receivable, Interest Income, Accrual Method [Abstract] | ||
Impaired loans with a valuation allowance, Interest Income Recognized | 0 | |
Impaired loans without a valuation allowance, Interest Income Recognized | 157 | 235 |
Total residential real estate [Member] | ||
Impaired Financing Receivable, Recorded Investment [Abstract] | ||
Impaired loans, Outstanding Balance | 2,741 | 3,454 |
Impaired Financing Receivable, Unpaid Principal Balance [Abstract] | ||
Impaired loans, Unpaid Principal Balance | 3,001 | 3,725 |
Impaired loans, Valuation Allowance | 439 | 565 |
Impaired Financing Receivable, Average Recorded Investment [Abstract] | ||
Impaired loans, Average Outstanding Balance | 3,061 | 3,799 |
Impaired Financing Receivable, Interest Income, Accrual Method [Abstract] | ||
Impaired loans, Interest Income Recognized | 126 | 151 |
Residential real estate senior liens [Member] | ||
Impaired Financing Receivable, Recorded Investment [Abstract] | ||
Impaired loans with a valuation allowance, Outstanding Balance | 2,741 | 3,417 |
Impaired Financing Receivable, Unpaid Principal Balance [Abstract] | ||
Impaired loans with a valuation allowance, Unpaid Principal Balance | 3,001 | 3,688 |
Impaired loans, Valuation Allowance | 439 | 565 |
Impaired Financing Receivable, Average Recorded Investment [Abstract] | ||
Impaired loans with a valuation allowance, Average Outstanding Balance | 3,056 | 3,794 |
Impaired Financing Receivable, Interest Income, Accrual Method [Abstract] | ||
Impaired loans with a valuation allowance, Interest Income Recognized | 126 | 151 |
Residential real estate home equity lines of credit [Member] | ||
Impaired Financing Receivable, Recorded Investment [Abstract] | ||
Impaired loans without a valuation allowance, Outstanding Balance | 0 | 37 |
Impaired Financing Receivable, Unpaid Principal Balance [Abstract] | ||
Impaired loans without a valuation allowance, Unpaid Principal Balance | 0 | 37 |
Impaired Financing Receivable, Average Recorded Investment [Abstract] | ||
Impaired loans without a valuation allowance, Average Outstanding Balance | 5 | 5 |
Impaired Financing Receivable, Interest Income, Accrual Method [Abstract] | ||
Impaired loans without a valuation allowance, Interest Income Recognized | $ 0 | $ 0 |
Loans and ALLL (Summary of in_2
Loans and ALLL (Summary of information pertaining to TDRs) (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 USD ($) loan | Dec. 31, 2021 USD ($) loan | |
Financing Receivable, Modifications [Line Items] | ||
Number of Loans | loan | 4 | 11 |
Pre-Modification Recorded Investment | $ 2,969 | $ 8,473 |
Post-Modification Recorded Investment | $ 2,969 | $ 8,473 |
Commercial other [Member] | ||
Financing Receivable, Modifications [Line Items] | ||
Number of Loans | loan | 3 | 5 |
Pre-Modification Recorded Investment | $ 2,871 | $ 4,761 |
Post-Modification Recorded Investment | $ 2,871 | $ 4,761 |
Agricultural other [Member] | ||
Financing Receivable, Modifications [Line Items] | ||
Number of Loans | loan | 0 | 6 |
Pre-Modification Recorded Investment | $ 0 | $ 3,712 |
Post-Modification Recorded Investment | $ 0 | $ 3,712 |
Residential real estate senior liens [Member] | ||
Financing Receivable, Modifications [Line Items] | ||
Number of Loans | loan | 1 | 0 |
Pre-Modification Recorded Investment | $ 98 | $ 0 |
Post-Modification Recorded Investment | $ 98 | $ 0 |
Below Market Interest Rate and Extension of Amortization Period [Member] | ||
Financing Receivable, Modifications [Line Items] | ||
Number of Loans | loan | 1 | 4 |
Pre-Modification Recorded Investment | $ 98 | $ 1,572 |
Below Market Interest Rate and Extension of Amortization Period [Member] | Commercial other [Member] | ||
Financing Receivable, Modifications [Line Items] | ||
Number of Loans | loan | 0 | 4 |
Pre-Modification Recorded Investment | $ 0 | $ 1,572 |
Below Market Interest Rate and Extension of Amortization Period [Member] | Agricultural other [Member] | ||
Financing Receivable, Modifications [Line Items] | ||
Number of Loans | loan | 0 | 0 |
Pre-Modification Recorded Investment | $ 0 | $ 0 |
Below Market Interest Rate and Extension of Amortization Period [Member] | Residential real estate senior liens [Member] | ||
Financing Receivable, Modifications [Line Items] | ||
Number of Loans | loan | 1 | 0 |
Pre-Modification Recorded Investment | $ 98 | $ 0 |
Interest Rate Below Market Reduction [Member] | ||
Financing Receivable, Modifications [Line Items] | ||
Number of Loans | loan | 3 | 7 |
Pre-Modification Recorded Investment | $ 2,871 | $ 6,901 |
Interest Rate Below Market Reduction [Member] | Commercial other [Member] | ||
Financing Receivable, Modifications [Line Items] | ||
Number of Loans | loan | 3 | 1 |
Pre-Modification Recorded Investment | $ 2,871 | $ 3,189 |
Interest Rate Below Market Reduction [Member] | Agricultural other [Member] | ||
Financing Receivable, Modifications [Line Items] | ||
Number of Loans | loan | 0 | 6 |
Pre-Modification Recorded Investment | $ 0 | $ 3,712 |
Interest Rate Below Market Reduction [Member] | Residential real estate senior liens [Member] | ||
Financing Receivable, Modifications [Line Items] | ||
Number of Loans | loan | 0 | 0 |
Pre-Modification Recorded Investment | $ 0 | $ 0 |
Principal Forgiveness | ||
Financing Receivable, Modifications [Line Items] | ||
Number of Loans | loan | 0 | 0 |
Loans and ALLL (Summary of Defa
Loans and ALLL (Summary of Defaulted TDRs) (Details) - loan | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Financing Receivable, Modifications [Line Items] | ||
Financing Receivable, Modifications, Subsequent Default, Number of Contracts | 0 | 0 |
Loans and ALLL (Summary of TDR
Loans and ALLL (Summary of TDR loan balances) (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Receivables [Abstract] | ||
Troubled debt restructurings | $ 21,339 | $ 25,725 |
Loans and ALLL (Narrative) (Det
Loans and ALLL (Narrative) (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Migration analysis of loan portfolio period | 5 years | |
Threshold period of continuous performance to return loans to accrual status | 6 months | |
Advance in connection with impaired loans | $ 0 | $ 266 |
Minimum [Member] | 4 - Low satisfactory [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Delinquency period | 10 days | |
Minimum [Member] | 5 - Special mention [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Delinquency period | 30 days | |
Maximum [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Financing receivable, amortization term | 30 years | |
Maximum [Member] | 4 - Low satisfactory [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Delinquency period | 30 days | |
Maximum [Member] | 5 - Special mention [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Delinquency period | 60 days | |
Commercial, Agricultural, and Residential Portfolio Segments [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Number of days past due (or more), accrual of interest discontinued | 90 days | |
Consumer [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Maximum days of consumer loan charged off | 180 days | |
Consumer [Member] | Maximum [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Financing receivable, amortization term | 15 years | |
Commercial and Agricultural [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Maximum percentage of loan | 0.80 | |
Commercial and Agricultural [Member] | Customer Concentration Risk [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Maximum amount of loans | $ 18,000 | |
Residential Real Estate [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Maximum percentage of loan | 1 | |
Maximum percentage of principal, interest, taxes and hazard insurance on property over gross income | 0.28 | |
Maximum percentage of debt servicing over gross income | 0.40 | |
Maximum amount without corporation approval | $ 1,000 | |
Residential, Privately Insured, Financing Receivable [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Maximum percentage of loan | 0.80 |
Premises and Equipment (Details
Premises and Equipment (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Property, Plant and Equipment [Line Items] | ||
Total | $ 73,070 | $ 73,034 |
Less: accumulated depreciation | 47,517 | 48,615 |
Premises and equipment, net | 25,553 | 24,419 |
Land [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total | 5,904 | 6,164 |
Buildings and improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total | 31,260 | 30,738 |
Furniture and equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total | $ 35,906 | $ 36,132 |
Premises and Equipment (Narrati
Premises and Equipment (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |||
Depreciation expense | $ 2,071 | $ 2,314 | $ 2,620 |
Goodwill and Other Intangible_3
Goodwill and Other Intangible Assets (Identifiable intangible assets) (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Finite-Lived Intangible Assets [Line Items] | ||
Net Intangible Assets | $ 5 | |
Core deposit premium resulting from acquisitions [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Intangible Assets | 5,579 | $ 5,579 |
Accumulated Amortization | 5,574 | 5,559 |
Net Intangible Assets | $ 5 | $ 20 |
Goodwill and Other Intangible_4
Goodwill and Other Intangible Assets (Estimated amortization expense) (Details) $ in Thousands | Dec. 31, 2022 USD ($) |
Summary of estimated amortization expense associated with identifiable intangibles | |
Year 1 | $ 2 |
Year 2 | 2 |
Year 3 | 1 |
Net Intangible Assets | $ 5 |
Goodwill and Other Intangible_5
Goodwill and Other Intangible Assets (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Finite-Lived Intangible Assets [Line Items] | |||
Amortization expense of identifiable intangible assets | $ 15 | $ 29 | $ 48 |
Goodwill | $ 48,282 | $ 48,282 |
Deposits (Scheduled maturities
Deposits (Scheduled maturities of time deposits) (Details) $ in Thousands | Dec. 31, 2022 USD ($) |
Scheduled maturities of time deposits | |
Year One | $ 153,482 |
Year Two | 41,744 |
Year Three | 23,288 |
Year Four | 18,364 |
Year Five | 15,055 |
Thereafter | 107 |
Time Deposits, Total | $ 252,040 |
Deposits (Narrative) (Details)
Deposits (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Deposits [Abstract] | |||
Interest Expense, Time Deposits, Greater than $250,000 | $ 621 | $ 980 | $ 1,883 |
Borrowed Funds (Short-term borr
Borrowed Funds (Short-term borrowings) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Short-term Debt [Line Items] | ||
Debt, Long-term and Short-term, Combined Amount | $ 87,016 | $ 99,320 |
Securities Sold under Agreements to Repurchase [Member] | ||
Short-term Debt [Line Items] | ||
Maximum Month End Balance | 58,140 | 71,059 |
Quarter to Date Average Balance | $ 49,973 | $ 57,451 |
Weighted Average Interest Rate During the Period | 0.16% | 0.09% |
Debt, Long-term and Short-term, Combined Amount | $ 57,771 | $ 50,162 |
Borrowed funds, Rate | 0.49% | 0.07% |
Federal Funds Purchased [Member] | ||
Short-term Debt [Line Items] | ||
Maximum Month End Balance | $ 0 | $ 80 |
Quarter to Date Average Balance | $ 1 | $ 2 |
Weighted Average Interest Rate During the Period | 3.02% | 0.47% |
Borrowed Funds (Pledged financi
Borrowed Funds (Pledged financial instruments) (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Debt Disclosure [Abstract] | ||
Pledged to secure borrowed funds | $ 347,331 | $ 334,415 |
Total | 454,320 | 412,742 |
Short-term Debt [Line Items] | ||
Pledged Financial Instruments, Available for Sale Securities, without Single Maturity Date | 58,291 | 50,173 |
Securities Sold under Agreements to Repurchase, Fair Value of Collateral | 58,291 | 50,173 |
Deposit Liabilities, Collateral Issued, Financial Instruments | 48,698 | 28,154 |
State and Local Funds Purchased [Member] | ||
Short-term Debt [Line Items] | ||
Pledged Financial Instruments, Available for Sale Securities, without Single Maturity Date | 11,037 | 13,491 |
Mortgage Backed Securities, Other [Member] | ||
Short-term Debt [Line Items] | ||
Pledged Financial Instruments, Available for Sale Securities, without Single Maturity Date | 6,819 | 13,174 |
Collateralized Mortgage Obligations [Member] | ||
Short-term Debt [Line Items] | ||
Pledged Financial Instruments, Available for Sale Securities, without Single Maturity Date | 11,084 | 13,797 |
US Treasury Securities | ||
Short-term Debt [Line Items] | ||
Pledged Financial Instruments, Available for Sale Securities, without Single Maturity Date | $ 29,351 | $ 9,711 |
Borrowed Funds (Maturity and we
Borrowed Funds (Maturity and weighted average interest rates of FHLB advances) (Details) - Federal Home Loan Bank, Advances, Fixed Rate Due 2022 [Member] - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Federal Home Loan Bank, Advances [Line Items] | ||
FHLB fixed rate advances | $ 0 | $ 20,000 |
FHLB advances, rate | 0% | 1.97% |
Borrowed Funds (Subordinated De
Borrowed Funds (Subordinated Debt) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Subordinated Borrowing [Line Items] | ||
Subordinated Borrowing, Interest Rate | 3.25% | 3.25% |
Subordinated Debt | $ 29,245 | $ 29,158 |
Subordinated Debt | ||
Subordinated Borrowing [Line Items] | ||
Debt Instrument, Unamortized Discount (Premium) and Debt Issuance Costs, Net | (755) | (842) |
Debt Instrument, Face Amount | $ 30,000 | $ 30,000 |
Borrowed Funds (Narrative) (Det
Borrowed Funds (Narrative) (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Debt Disclosure [Abstract] | ||
Securities Sold under Agreements to Repurchase, Fair Value of Collateral | $ 58,291 | $ 50,173 |
Debt Instrument, Unused Borrowing Capacity, Amount | $ 344,393 |
Off-Balance-Sheet Activities (C
Off-Balance-Sheet Activities (Contractual amount of credit related financial instruments) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Contract Amount | $ 290,993 | $ 265,306 |
Maximum maturity period of commitments to extend credit | 1 year | |
Unfunded commitments under lines of credit [Member] | ||
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Contract Amount | $ 264,902 | 231,120 |
Commercial and standby letters of credit [Member] | ||
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Contract Amount | 1,321 | 1,738 |
Commitments to grant loans [Member] | ||
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Contract Amount | $ 24,770 | $ 32,448 |
On-Balance Sheet Activities (Na
On-Balance Sheet Activities (Narrative) (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Derivative [Line Items] | ||
Derivative Asset, Fair Value of Collateral | $ 394 | $ 2,330 |
Not Designated as Hedging Instrument [Member] | Interest Rate Lock Commitments [Member] | ||
Derivative [Line Items] | ||
Notional Amount of undesignated commitments | 0 | 788 |
Not Designated as Hedging Instrument [Member] | Forward Contracts [Member] | ||
Derivative [Line Items] | ||
Notional Amount of undesignated commitments | $ 379 | $ 2,255 |
Commitments and Other Matters (
Commitments and Other Matters (Narrative) (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Commitments and Contingencies Disclosure [Abstract] | ||
Cash reserve balance, correspondent banks | $ 500 | $ 500 |
Amount available for dividends without regulatory approval | $ 39,800 |
Minimum Regulatory Capital Re_3
Minimum Regulatory Capital Requirements (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | |
Banking Regulation, Risk-Based Information [Abstract] | ||
Regulatory Capital Requirements under Banking Regulations [Text Block] | Minimum Regulatory Capital Requirements The Corporation (on a consolidated basis) and the Bank are subject to various regulatory capital requirements administered by the FRB and the FDIC. Failure to meet minimum capital requirements can initiate mandatory and possibly additional discretionary actions by the FRB and the FDIC that, if undertaken, could have a material effect on our financial statements. Under regulatory capital adequacy guidelines and the regulatory framework for prompt corrective action, we must meet specific capital guidelines that include quantitative measures of assets, liabilities, capital, and certain off-balance-sheet items, as calculated under regulatory accounting standards. Our capital amounts and classifications are also subject to qualitative judgments by the FRB and the FDIC about components, risk weightings, and other factors. Prompt corrective action provisions are not applicable to bank holding companies. Quantitative measures established by regulation to ensure capital adequacy require us to maintain minimum amounts and ratios (set forth in the following table) of total capital, tier 1 capital, and common equity tier 1 capital (as defined in the regulations) to risk-weighted assets (as defined) and tier 1 capital to average assets (as defined). We believe, as of December 31, 2022 and 2021, that we met all capital adequacy requirements. The FRB has established minimum risk-based capital guidelines. Pursuant to these guidelines, a framework has been established that assigns risk weights to each category of on and off-balance-sheet items to arrive at risk adjusted total assets. Regulatory capital is divided by the risk adjusted assets with the resulting ratio compared to the minimum standard to determine whether a corporation has adequate capital. The common equity tier 1 capital ratio has a minimum requirement of 4.50%. The minimum standard for primary, or Tier 1 capital is 6.00% and the minimum standard for total capital is 8.00%. As of December 31, 2022 and 2021, the most recent notifications from the FRB and the FDIC categorized us as well capitalized under the regulatory framework for prompt corrective action. To be categorized as well capitalized, an institution must maintain total risk-based, Tier 1 risk-based, Common Equity Tier 1, and Tier 1 leverage ratios as set forth in the following tables. There were no conditions or events since the notifications that we believe have changed our categories. Our actual capital amounts and ratios are also presented in the table. Actual Minimum Minimum To Be Well Amount Ratio Amount Ratio Amount Ratio December 31, 2022 Common equity Tier 1 capital to risk weighted assets Isabella Bank $ 190,060 14.07 % $ 94,565 7.00 % $ 87,811 6.50 % Consolidated 175,112 12.91 % 94,948 7.00 % N/A N/A Tier 1 capital to risk weighted assets Isabella Bank 190,060 14.07 % 114,829 8.50 % 108,075 8.00 % Consolidated 175,112 12.91 % 115,295 8.50 % N/A N/A Total capital to risk weighted assets Isabella Bank 199,910 14.80 % 141,848 10.50 % 135,093 10.00 % Consolidated 214,207 15.79 % 142,423 10.50 % N/A N/A Tier 1 capital to average assets Isabella Bank 190,060 9.36 % 81,181 4.00 % 101,476 5.00 % Consolidated 175,112 8.61 % 81,392 4.00 % N/A N/A Actual Minimum Minimum To Be Well Amount Ratio Amount Ratio Amount Ratio December 31, 2021 Common equity Tier 1 capital to risk weighted assets Isabella Bank $ 171,255 12.91 % $ 92,849 7.00 % $ 86,217 6.50 % Consolidated 160,871 12.07 % 93,297 7.00 % N/A N/A Tier 1 capital to risk weighted assets Isabella Bank 171,255 12.91 % 112,746 8.50 % 106,114 8.00 % Consolidated 160,871 12.07 % 113,289 8.50 % N/A N/A Total capital to risk weighted assets Isabella Bank 180,358 13.60 % 139,274 10.50 % 132,642 10.00 % Consolidated 199,132 14.94 % 139,945 10.50 % N/A N/A Tier 1 capital to average assets Isabella Bank 171,255 8.54 % 80,171 4.00 % 100,214 5.00 % Consolidated 160,871 7.97 % 80,733 4.00 % N/A N/A | |
Common Equity Tier 1 Capital [Abstract] | ||
Common Equity Tier One Capital | $ 175,112 | $ 160,871 |
Banking Regulation, Common Equity Tier 1 Risk-Based Capital Ratio, Actual | 0.1291 | 0.1207 |
CommonEquityTierOneRiskBasedCapitalRequiredForCapitalAdequacy | $ 94,948 | $ 93,297 |
CommonEquityTierOneRiskBasedCapitalRequiredForCapitalAdequacyToRiskWeightedAssets | 7% | 7% |
Tier 1 capital to risk weighted assets | ||
Actual Amount | $ 175,112 | $ 160,871 |
Actual Ratio | 0.1291 | 0.1207 |
Capital Adequacy Minimum with Buffer | $ 115,295 | $ 113,289 |
TierOneRiskBasedCapitalRequiredForCapitalAdequacyToRiskWeightedAssetsMinimumCapitalRequiredPlusCapitalConservationBuffer | 0.0850 | 0.0850 |
Total capital to risk weighted assets | ||
Actual Amount | $ 214,207 | $ 199,132 |
Actual Ratio | 0.1579 | 0.1494 |
CapitalRequiredForCapitalAdequacyMinimumCapitalRequiredPlusCapitalConservationBuffer | $ 142,423 | $ 139,945 |
CapitalRequiredForCapitalAdequacyToRiskWeightedAssetsMinimumCapitalRequiredPlusCapitalConservationBuffer | 0.1050 | 0.1050 |
Tier 1 capital to average assets | ||
Actual Amount | $ 175,112 | $ 160,871 |
Actual Ratio | 0.0861 | 0.0797 |
TierOneLeverageCapitalRequiredForCapitalAdequacyMinimumCapitalRequiredPlusCapitalConservationBuffer | $ 81,392 | $ 80,733 |
TierOneLeverageCapitalRequiredForCapitalAdequacyToAverageAssetsMinimumCapitalRequiredPlusCapitalConservationBuffer | 0.0400 | 0.0400 |
Isabella Bank [Member] | ||
Common Equity Tier 1 Capital [Abstract] | ||
Common Equity Tier One Capital | $ 190,060 | $ 171,255 |
Banking Regulation, Common Equity Tier 1 Risk-Based Capital Ratio, Actual | 0.1407 | 0.1291 |
CommonEquityTierOneRiskBasedCapitalRequiredForCapitalAdequacy | $ 94,565 | $ 92,849 |
CommonEquityTierOneRiskBasedCapitalRequiredForCapitalAdequacyToRiskWeightedAssets | 7% | 7% |
Banking Regulation, Common Equity Tier 1 Risk-Based Capital, Well Capitalized, Minimum | $ 87,811 | $ 86,217 |
Banking Regulation, Common Equity Tier 1 Risk-Based Capital Ratio, Well Capitalized, Minimum | 0.0650 | 0.0650 |
Tier 1 capital to risk weighted assets | ||
Actual Amount | $ 190,060 | $ 171,255 |
Actual Ratio | 0.1407 | 0.1291 |
Capital Adequacy Minimum with Buffer | $ 114,829 | $ 112,746 |
TierOneRiskBasedCapitalRequiredForCapitalAdequacyToRiskWeightedAssetsMinimumCapitalRequiredPlusCapitalConservationBuffer | 0.0850 | 0.0850 |
Minimum To Be Well Capitalized Under Prompt Corrective Action Provisions Amount | $ 108,075 | $ 106,114 |
Minimum To Be Well Capitalized Under Prompt Corrective Action Provisions Ratio | 0.0800 | 0.0800 |
Total capital to risk weighted assets | ||
Actual Amount | $ 199,910 | $ 180,358 |
Actual Ratio | 0.1480 | 0.1360 |
CapitalRequiredForCapitalAdequacyMinimumCapitalRequiredPlusCapitalConservationBuffer | $ 141,848 | $ 139,274 |
CapitalRequiredForCapitalAdequacyToRiskWeightedAssetsMinimumCapitalRequiredPlusCapitalConservationBuffer | 0.1050 | 0.1050 |
Minimum To Be Well Capitalized Under Prompt Corrective Action Provisions Amount | $ 135,093 | $ 132,642 |
Minimum To Be Well Capitalized Under Prompt Corrective Action Provisions Ratio | 0.1000 | 0.1000 |
Tier 1 capital to average assets | ||
Actual Amount | $ 190,060 | $ 171,255 |
Actual Ratio | 0.0936 | 0.0854 |
TierOneLeverageCapitalRequiredForCapitalAdequacyMinimumCapitalRequiredPlusCapitalConservationBuffer | $ 81,181 | $ 80,171 |
TierOneLeverageCapitalRequiredForCapitalAdequacyToAverageAssetsMinimumCapitalRequiredPlusCapitalConservationBuffer | 0.0400 | 0.0400 |
Minimum To Be Well Capitalized Under Prompt Corrective Action Provisions Amount | $ 101,476 | $ 100,214 |
Minimum To Be Well Capitalized Under Prompt Corrective Action Provisions Ratio | 0.0500 | 0.0500 |
Computation of Earnings Per C_3
Computation of Earnings Per Common Share (Schedule of Earnings Per Share) (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | ||
Earnings Per Share [Abstract] | ||||
Average number of common shares outstanding for basic calculation | 7,549,878 | 7,853,398 | 7,959,705 | |
Average number of common shares outstanding used to calculate diluted earnings per common share | 7,647,612 | 7,965,961 | 8,106,091 | |
Net Income (Loss) Attributable to Parent | $ 22,238 | $ 19,499 | $ 10,885 | |
Basic (in dollars per share) | $ 2.95 | $ 2.48 | $ 1.37 | |
Diluted (in dollars per share) | $ 2.91 | $ 2.45 | $ 1.34 | |
Isabella Bank Corporation and Related Companies Deferred Compensation Plan for Directors | ||||
Earnings Per Share [Abstract] | ||||
Average potential effect of common shares in the Directors Plan | [1] | 70,329 | 99,813 | 143,878 |
Earnings Per Share, Diluted, by Common Class, Including Two Class Method [Line Items] | ||||
Incremental Common Shares Attributable to Dilutive Effect of Share-based Payment Arrangements | [1] | 70,329 | 99,813 | 143,878 |
Isabella Bank Corporation Restricted Stock Plan | ||||
Earnings Per Share [Abstract] | ||||
Average potential effect of common shares in the Directors Plan | 27,405 | 12,750 | 2,508 | |
Earnings Per Share, Diluted, by Common Class, Including Two Class Method [Line Items] | ||||
Incremental Common Shares Attributable to Dilutive Effect of Share-based Payment Arrangements | 27,405 | 12,750 | 2,508 | |
[1]Exclusive of shares held in the Rabbi Trust |
Benefit Plans (Changes in the d
Benefit Plans (Changes in the defined benefit pension plan) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Change in benefit obligation | |||
Benefit obligation, January 1 | $ 9,725 | $ 10,358 | |
Interest cost | 224 | 233 | $ 306 |
Actuarial (gain) loss | (2,236) | (357) | |
Defined Benefit Plan, Benefit Obligation, Benefits Paid | 817 | 509 | |
Benefit obligation, December 31 | 6,896 | 9,725 | 10,358 |
Change in plan assets | |||
Fair value of plan assets, January 1 | 8,649 | 8,263 | |
Investment return | (1,250) | 831 | |
Contributions | 0 | 64 | |
Defined Benefit Plan, Plan Assets, Benefits Paid | 817 | 509 | |
Fair value of plan assets, December 31 | 6,582 | 8,649 | 8,263 |
Deficiency in funded status at December31, included on the consolidated balance sheets in accrued interest payable and other liabilities | (314) | (1,076) | |
Defined Benefit Plan, Accumulated Benefit Obligation | 6,896 | 9,725 | |
Accrued benefit cost at January 1 | (1,076) | (2,095) | |
Contributions | 0 | 64 | |
Net periodic cost for the year | (59) | 31 | (176) |
Net change in unrecognized actuarial loss and prior service cost | 821 | 924 | (62) |
Accrued benefit cost at December 31 | $ (314) | $ (1,076) | $ (2,095) |
Benefit Plans (Components of ne
Benefit Plans (Components of net periodic benefit cost) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Retirement Benefits [Abstract] | |||
Interest cost on benefit obligation | $ 224 | $ 233 | $ 306 |
Expected return on plan assets | (490) | (486) | (488) |
Amortization of unrecognized actuarial net loss | 216 | 222 | 206 |
Settlement loss | 109 | 0 | 152 |
Net periodic cost for the year | $ (59) | $ 31 | $ (176) |
Benefit Plans (Actuarial assump
Benefit Plans (Actuarial assumptions used) (Details) | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Retirement Benefits [Abstract] | |||
Defined Benefit Plan, Assumptions Used Calculating Benefit Obligation, Discount Rate | 4.88% | 2.43% | 2.30% |
Defined Benefit Plan, Assumptions Used Calculating Net Periodic Benefit Cost, Discount Rate | 2.43% | 2.30% | 3.07% |
Actuarial weighted average assumptions used in determining the net periodic pension costs | |||
Expected long-term return on plan assets | 6% | 6% | 6% |
Benefit Plans (Fair values of o
Benefit Plans (Fair values of our pension plan assets by asset category) (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Defined Benefit Plan Disclosure [Line Items] | |||
Fair values of the Corporation's pension plan assets | $ 6,582 | $ 8,649 | $ 8,263 |
Level 2 [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair values of the Corporation's pension plan assets | 6,582 | 8,649 | |
Short-term investments [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair values of the Corporation's pension plan assets | 235 | 127 | |
Short-term investments [Member] | Level 2 [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair values of the Corporation's pension plan assets | 235 | 127 | |
Fixed income [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair values of the Corporation's pension plan assets | 2,983 | 3,750 | |
Fixed income [Member] | Level 2 [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair values of the Corporation's pension plan assets | 2,983 | 3,750 | |
Equity investments [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair values of the Corporation's pension plan assets | 3,364 | 4,772 | |
Equity investments [Member] | Level 2 [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair values of the Corporation's pension plan assets | $ 3,364 | $ 4,772 |
Benefit Plans (Estimated future
Benefit Plans (Estimated future benefit payments) (Details) $ in Thousands | Dec. 31, 2022 USD ($) |
Retirement Benefits [Abstract] | |
2016 | $ 800 |
2017 | 564 |
2018 | 669 |
2019 | 713 |
2020 | 546 |
Years 2021 - 2025 | $ 2,557 |
Benefit Plans (Components of sh
Benefit Plans (Components of shares eligible to be issued under the Directors Plan) (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Deferred Compensation Arrangement with Individual, Share-based Payments [Line Items] | ||
Eligible shares, unissued | 154,879 | 105,654 |
Director [Member] | ||
Deferred Compensation Arrangement with Individual, Share-based Payments [Line Items] | ||
Eligible shares, unissued | 52,961 | 83,710 |
Eligible shares, shares held in Rabbi Trust | 154,879 | 105,654 |
Eligible shares, total | 207,840 | 189,364 |
Market value, unissued | $ 1,245 | $ 2,135 |
Market value, shares held in Rabbi Trust | 3,640 | 2,694 |
Market value, total | $ 4,885 | $ 4,829 |
Benefit Plans (Narrative) (Deta
Benefit Plans (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Retirement Benefits [Abstract] | |||
Employees contribution | 100% | ||
Corporation matching contribution, percent | 100% | ||
Employee contribution, percent | 5% | ||
Defined Contribution Plan Disclosure [Line Items] | |||
Performance bonus expense | $ 1,072 | $ 1,063 | $ 1,101 |
Defined Benefit Plan, Net Periodic Benefit Cost (Credit), Gain (Loss) Due to Settlement | (109) | 0 | (152) |
Plan expenses | 805 | 792 | 813 |
Accumulated other comprehensive income includes net unrecognized pension cost before income taxes | 1,729 | ||
Corporation self-funded medical plan | 100 | ||
Medical expenses | 3,026 | 3,297 | 1,868 |
Defined Benefit Plan Disclosure [Line Items] | |||
Performance Bonus Expense - Executive Plan | 252 | 253 | 165 |
Other Postretirement Benefits Plan [Member] | |||
Defined Contribution Plan Disclosure [Line Items] | |||
Plan expenses | 251 | 352 | 373 |
Restricted Stock | Isabella Bank Corporation Restricted Stock Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Compensation expense | 147 | $ 86 | $ 14 |
Unrecognized compensation expense | $ 346 | ||
Unrecognized compensation expense, period for recognition | 2 years 4 months 24 days | ||
Minimum [Member] | Restricted Stock | Isabella Bank Corporation Restricted Stock Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Maximum award as a percentage of salary | 25% | ||
Maximum [Member] | Restricted Stock | Isabella Bank Corporation Restricted Stock Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Maximum award as a percentage of salary | 40% | ||
Safe Harbor 401(k) [Member] | |||
Defined Contribution Plan Disclosure [Line Items] | |||
Vesting percentage | 100% | ||
Fixed Income Funds [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Investment allocation in securities | 50% | ||
Equity Collective Trust [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Investment allocation in securities | 50% |
Benefit Plans (Nonvested Restri
Benefit Plans (Nonvested Restricted Stock Awards Activity) (Details) - Restricted Stock - Isabella Bank Corporation Restricted Stock Plan - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Number of Shares | ||
Beginning balance (in shares) | 20,123 | 4,658 |
Granted (in shares) | 6,949 | 15,465 |
Vested (in shares) | 0 | 0 |
Forfeited (in shares) | 0 | 0 |
Ending balance (in shares) | 27,072 | 20,123 |
Fair Value | ||
Beginning balance | $ 418 | $ 82 |
Granted | 174 | 336 |
Vested | 0 | 0 |
Forfeited | 0 | 0 |
Ending balance | $ 592 | $ 418 |
Revenue (Details)
Revenue (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Debit Card [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | $ 3,783 | $ 3,623 | $ 2,961 |
Fiduciary and Trust [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 2,622 | 2,707 | 2,294 |
Investment Advice [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 383 | 364 | 284 |
Service Charges And Deposit Account Fees [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | $ 345 | $ 312 | $ 290 |
Revenue Schedule of Revenue for
Revenue Schedule of Revenue for Each Major Category (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Debit Card [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | $ 3,783 | $ 3,623 | $ 2,961 |
Fiduciary and Trust [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 2,622 | 2,707 | 2,294 |
Investment Advice [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 383 | 364 | 284 |
Service Charges And Deposit Account Fees [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | $ 345 | $ 312 | $ 290 |
Other Noninterest Expenses (Exp
Other Noninterest Expenses (Expenses included in other noninterest expenses) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Summary of expenses included in other noninterest expenses | |||
Professional Fees, Audit, Consulting, & Legal | $ 2,358 | $ 2,066 | $ 1,836 |
FDIC insurance premiums | 537 | 690 | 612 |
ATM and Debit Card Expense | 1,909 | 1,810 | 1,441 |
Director fees | 790 | 703 | 695 |
Loan underwriting fees | 1,004 | 849 | 825 |
All other | 2,783 | 2,183 | 2,725 |
Total other | 12,236 | 10,822 | 10,474 |
Donations and community relations | 923 | 705 | 723 |
Marketing Expense | 1,056 | 939 | 877 |
Memberships and Subscriptions Expense | $ 876 | $ 877 | $ 740 |
Federal Income Taxes (Component
Federal Income Taxes (Components of the consolidated provision for federal income taxes) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |||
Currently payable | $ 4,593 | $ 4,371 | $ 1,263 |
Deferred (benefit) expense | 13 | (523) | (276) |
Income tax expense | $ 4,606 | $ 3,848 | $ 987 |
Federal Income Taxes (Reconcili
Federal Income Taxes (Reconciliation of the provision for federal income taxes) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |||
Income taxes at 34% statutory rate | $ 5,637 | $ 4,903 | $ 2,493 |
Interest income on tax exempt municipal securities | (587) | (643) | (802) |
Earnings on corporate owned life insurance policies | (197) | (225) | (346) |
Other | 329 | 312 | 288 |
Total effect of nontaxable income | (455) | (556) | (860) |
Effect of nondeductible expenses | 45 | 46 | 68 |
Effect of tax credits | (621) | (617) | (830) |
Unrecognized Deferred Tax Benefit on Joint Venture Investment | 0 | 72 | 116 |
Federal income tax expense | $ 4,606 | $ 3,848 | $ 987 |
Federal Income Taxes (Significa
Federal Income Taxes (Significant components of our deferred tax assets and liabilities) (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Deferred tax assets | ||
Allowance for loan losses | $ 1,848 | $ 1,635 |
Deferred directors' fees | 1,648 | 1,553 |
Employee benefit plans | 82 | 98 |
Core deposit premium and acquisition expenses | 764 | 759 |
Deferred Tax Asset, Debt Securities, Available-for-Sale, Unrealized Loss | 9,296 | 0 |
Net unrecognized actuarial loss on pension plan | 363 | 536 |
Life insurance death benefit payable | 497 | 497 |
Other | 789 | 867 |
Total deferred tax assets | 15,287 | 5,945 |
Deferred tax liabilities | ||
Prepaid pension cost | 297 | 309 |
Premises and equipment | 1,590 | 1,729 |
Accretion on securities | 166 | 61 |
Core deposit premium and acquisition expenses | 984 | 947 |
Net unrealized gains on available-for-sale securities | 0 | 1,018 |
Other | 1,075 | 834 |
Total deferred tax liabilities | 4,112 | 4,898 |
Net deferred tax assets (liabilities) | $ 11,175 | $ 1,047 |
Federal Income Taxes (Narrative
Federal Income Taxes (Narrative) (Details) | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |||
Federal statutory tax rate | 21% | 21% | 21% |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive Income (Loss) (Changes in AOCI by component) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Increase (Decrease) in Accumulated Other Comprehensive Income [Roll Forward] | |||
Accumulated Other Comprehensive Income (Loss), Net of Tax | $ 1,859 | $ 7,698 | $ 1,971 |
OCI before reclassifications | (49,253) | (7,363) | 7,115 |
Amounts reclassified from AOCI | 59 | (31) | 105 |
Net unrealized gains (losses) | (49,194) | (7,394) | 7,220 |
Tax effect | 10,141 | 1,555 | (1,493) |
Unrealized gains (losses), net of tax | (39,053) | (5,839) | 5,727 |
Accumulated Other Comprehensive Income (Loss), Net of Tax | (37,194) | 1,859 | 7,698 |
Unrealized Holding Gains (Losses) on AFS Securities [Member] | |||
Increase (Decrease) in Accumulated Other Comprehensive Income [Roll Forward] | |||
Accumulated Other Comprehensive Income (Loss), Net of Tax | 3,873 | 10,485 | 4,612 |
OCI before reclassifications | (50,015) | (8,371) | 7,474 |
Amounts reclassified from AOCI | 0 | 0 | (71) |
Net unrealized gains (losses) | (50,015) | (8,371) | 7,403 |
Tax effect | 10,314 | 1,759 | (1,530) |
Unrealized gains (losses), net of tax | (39,701) | (6,612) | 5,873 |
Accumulated Other Comprehensive Income (Loss), Net of Tax | (35,828) | 3,873 | 10,485 |
Accumulated Net Gain (Loss) from Cash Flow Hedges Attributable to Parent [Member] | |||
Increase (Decrease) in Accumulated Other Comprehensive Income [Roll Forward] | |||
Accumulated Other Comprehensive Income (Loss), Net of Tax | 0 | (42) | 54 |
OCI before reclassifications | 0 | 53 | (121) |
Amounts reclassified from AOCI | 0 | 0 | 0 |
Net unrealized gains (losses) | 0 | 53 | (121) |
Tax effect | 0 | (11) | 25 |
Unrealized gains (losses), net of tax | 0 | 42 | (96) |
Accumulated Other Comprehensive Income (Loss), Net of Tax | 0 | 0 | (42) |
Defined Benefit Pension Plan [Member] | |||
Increase (Decrease) in Accumulated Other Comprehensive Income [Roll Forward] | |||
Accumulated Other Comprehensive Income (Loss), Net of Tax | (2,014) | (2,745) | (2,695) |
OCI before reclassifications | 762 | 955 | (238) |
Amounts reclassified from AOCI | 59 | (31) | 176 |
Net unrealized gains (losses) | 821 | 924 | (62) |
Tax effect | (173) | (193) | 12 |
Unrealized gains (losses), net of tax | 648 | 731 | (50) |
Accumulated Other Comprehensive Income (Loss), Net of Tax | $ (1,366) | $ (2,014) | $ (2,745) |
Accumulated Other Comprehensi_4
Accumulated Other Comprehensive Income (Loss) (Components of unrealized holding gains on AFS securities) (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Unrealized gains (losses) arising during the period | $ (50,015) | $ (8,371) | $ 7,474 | |
Reclassification adjustment for net realized (gains) losses included in net income | 0 | 0 | (71) | |
Comprehensive income (loss) before income tax (expense) benefit | (50,015) | (8,371) | 7,403 | |
Tax effect | [1] | 10,314 | 1,759 | (1,530) |
Unrealized gains (losses), net of tax | (39,701) | (6,612) | 5,873 | |
Unrealized Holding Gains (Losses) on AFS Securities [Member] | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Unrealized gains (losses) arising during the period | (50,015) | (8,371) | 7,474 | |
Reclassification adjustment for net realized (gains) losses included in net income | 0 | 0 | (71) | |
Comprehensive income (loss) before income tax (expense) benefit | (50,015) | (8,371) | 7,403 | |
Tax effect | 10,314 | 1,759 | (1,530) | |
Unrealized gains (losses), net of tax | (39,701) | (6,612) | 5,873 | |
Unrealized Holding Gains (Losses) on AFS Securities [Member] | Auction Rate Money Market Preferred and Preferred Stocks [Member] | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Unrealized gains (losses) arising during the period | (900) | 5 | 118 | |
Reclassification adjustment for net realized (gains) losses included in net income | 0 | 0 | 0 | |
Comprehensive income (loss) before income tax (expense) benefit | (900) | 5 | 118 | |
Tax effect | 0 | 0 | 0 | |
Unrealized gains (losses), net of tax | (900) | 5 | 118 | |
Unrealized Holding Gains (Losses) on AFS Securities [Member] | All Other AFS Securities [Member] | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Unrealized gains (losses) arising during the period | (49,115) | (8,376) | 7,356 | |
Reclassification adjustment for net realized (gains) losses included in net income | 0 | 0 | (71) | |
Comprehensive income (loss) before income tax (expense) benefit | (49,115) | (8,376) | 7,285 | |
Tax effect | 10,314 | 1,759 | (1,530) | |
Unrealized gains (losses), net of tax | $ (38,801) | $ (6,617) | $ 5,755 | |
[1]See “Note 16 – Accumulated Other Comprehensive Income (Loss)” in the accompanying notes to consolidated financial statements for tax effect reconciliation. |
Accumulated Other Comprehensi_5
Accumulated Other Comprehensive Income (Loss) (Reclassification adjustments) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Reclassification out of Accumulated Other Comprehensive Income [Line Items] | |||
Income before federal income tax expense | $ 26,844 | $ 23,347 | $ 11,872 |
Labor and Related Expense | 24,887 | 23,749 | 23,772 |
Federal income tax expense | (4,606) | (3,848) | (987) |
NET INCOME | 22,238 | 19,499 | 10,885 |
Reclassification out of Accumulated Other Comprehensive Income [Member] | Unrealized Holding Gains (Losses) on AFS Securities [Member] | |||
Reclassification out of Accumulated Other Comprehensive Income [Line Items] | |||
Federal income tax expense | 0 | 0 | (15) |
NET INCOME | 0 | 0 | 56 |
Debt Securities, Available-for-sale, Realized Gain (Loss), Excluding Other-than-temporary Impairment | 0 | 0 | 71 |
Reclassification out of Accumulated Other Comprehensive Income [Member] | Defined Benefit Pension Plan [Member] | |||
Reclassification out of Accumulated Other Comprehensive Income [Line Items] | |||
Labor and Related Expense | 59 | (31) | 176 |
Federal income tax expense | (12) | 7 | (37) |
NET INCOME | $ 47 | $ (24) | $ 139 |
Fair Value (Narrative) (Details
Fair Value (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
OMSR Impairment | $ (532) | $ 0 | $ 316 |
Foreclosed Asset | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Change in fair value recorded through earnings | $ 6 | $ 0 |
Fair Value (Quantitative inform
Fair Value (Quantitative information about impaired loans) (Details) - Discounted appraisal value [Member] - Fair Value, Inputs, Level 3 [Member] - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31) | ||
Discounted appraisal value at fair value | $ 17,143 | $ 18,812 |
Loans Receivable, Collateralized By Livestock [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31) | ||
ImpairedFinancingReceivableFairValueDisclosureAppraisedValueDiscount | 30% | 30% |
ImpairedFinancingReceivableFairValueDisclosureAppraisedValueWeightedAverage | 30% | 30% |
Real Estate [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31) | ||
ImpairedFinancingReceivableFairValueDisclosureAppraisedValueWeightedAverage | 24% | 23% |
Real Estate [Member] | Minimum [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31) | ||
ImpairedFinancingReceivableFairValueDisclosureAppraisedValueDiscount | 20% | 20% |
Real Estate [Member] | Maximum [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31) | ||
ImpairedFinancingReceivableFairValueDisclosureAppraisedValueDiscount | 30% | 30% |
Equipment [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31) | ||
ImpairedFinancingReceivableFairValueDisclosureAppraisedValueWeightedAverage | 31% | 28% |
Equipment [Member] | Minimum [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31) | ||
ImpairedFinancingReceivableFairValueDisclosureAppraisedValueDiscount | 25% | 20% |
Equipment [Member] | Maximum [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31) | ||
ImpairedFinancingReceivableFairValueDisclosureAppraisedValueDiscount | 35% | 35% |
Liquor License [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31) | ||
ImpairedFinancingReceivableFairValueDisclosureAppraisedValueDiscount | 75% | |
ImpairedFinancingReceivableFairValueDisclosureAppraisedValueWeightedAverage | 75% | |
Loans Receivable, Collateralized By Accounts Receivable [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31) | ||
ImpairedFinancingReceivableFairValueDisclosureAppraisedValueDiscount | 25% | 50% |
ImpairedFinancingReceivableFairValueDisclosureAppraisedValueWeightedAverage | 27% | 50% |
Loans Receivable, Collateralized By Cash Crop Inventory [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31) | ||
ImpairedFinancingReceivableFairValueDisclosureAppraisedValueDiscount | 40% | 40% |
ImpairedFinancingReceivableFairValueDisclosureAppraisedValueWeightedAverage | 40% | 40% |
Furniture and Fixtures [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31) | ||
ImpairedFinancingReceivableFairValueDisclosureAppraisedValueDiscount | 45% | |
ImpairedFinancingReceivableFairValueDisclosureAppraisedValueWeightedAverage | 45% |
Fair Value (Quantitative info_2
Fair Value (Quantitative information related to foreclosed assets) (Details) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Discounted appraisal value [Member] | Level 3 [Member] | Loans Receivable, Collateralized By Cash Crop Inventory [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] (Deprecated 2018-01-31) | ||
ImpairedFinancingReceivableFairValueDisclosureAppraisedValueDiscount | 40% | 40% |
Fair Value (Carrying amount and
Fair Value (Carrying amount and estimated fair value of financial instruments) (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 | |
LIABILITIES | |||
Federal Funds Purchased and Securities Sold under Agreements to Repurchase | $ 57,771 | $ 50,162 | |
Level 1 [Member] | |||
ASSETS | |||
Cash and cash equivalents | 38,924 | 105,330 | |
Mortgage loans AFS | 0 | 0 | |
Total loans | 0 | 0 | |
Less allowance for loan losses | 0 | 0 | |
Net loans | 0 | 0 | |
Accrued interest receivable | 7,472 | 5,804 | |
Equity securities without readily determinable fair values | [1] | 0 | 0 |
OMSR | 0 | 0 | |
LIABILITIES | |||
Deposits without stated maturities | 1,492,235 | 1,409,577 | |
Deposits with stated maturities | 0 | 0 | |
Federal Funds Purchased and Securities Sold under Agreements to Repurchase | 0 | 0 | |
Federal Home Loan Bank Borrowings, Fair Value Disclosure | 0 | ||
Subordinated Debt Obligations, Fair Value Disclosure | 0 | 0 | |
Accrued interest payable | 255 | 251 | |
Level 2 [Member] | |||
ASSETS | |||
Cash and cash equivalents | 0 | 0 | |
Mortgage loans AFS | 395 | 1,797 | |
Total loans | 0 | 0 | |
Less allowance for loan losses | 0 | 0 | |
Net loans | 0 | 0 | |
Accrued interest receivable | 0 | 0 | |
Equity securities without readily determinable fair values | [1] | 0 | 0 |
OMSR | 3,174 | 2,753 | |
LIABILITIES | |||
Deposits without stated maturities | 0 | 0 | |
Deposits with stated maturities | 240,964 | 301,216 | |
Federal Funds Purchased and Securities Sold under Agreements to Repurchase | 57,581 | 50,153 | |
Federal Home Loan Bank Borrowings, Fair Value Disclosure | 20,120 | ||
Subordinated Debt Obligations, Fair Value Disclosure | 26,365 | 27,435 | |
Accrued interest payable | 0 | 0 | |
Level 3 [Member] | |||
ASSETS | |||
Cash and cash equivalents | 0 | 0 | |
Mortgage loans AFS | 0 | 0 | |
Total loans | 1,225,669 | 1,296,841 | |
Less allowance for loan losses | 9,850 | 9,103 | |
Net loans | 1,215,819 | 1,287,738 | |
Accrued interest receivable | 0 | 0 | |
Equity securities without readily determinable fair values | [1] | 0 | 0 |
OMSR | 0 | 0 | |
LIABILITIES | |||
Deposits without stated maturities | 0 | 0 | |
Deposits with stated maturities | 0 | 0 | |
Federal Funds Purchased and Securities Sold under Agreements to Repurchase | 0 | 0 | |
Federal Home Loan Bank Borrowings, Fair Value Disclosure | 0 | ||
Subordinated Debt Obligations, Fair Value Disclosure | 0 | 0 | |
Accrued interest payable | 0 | 0 | |
Carrying Value [Member] | |||
ASSETS | |||
Cash and cash equivalents | 38,924 | 105,330 | |
Mortgage loans AFS | 379 | 1,735 | |
Total loans | 1,264,173 | 1,301,037 | |
Less allowance for loan losses | 9,850 | 9,103 | |
Net loans | 1,254,323 | 1,291,934 | |
Accrued interest receivable | 7,472 | 5,804 | |
Equity securities without readily determinable fair values | [1] | 15,746 | 17,383 |
OMSR | 2,559 | 2,124 | |
LIABILITIES | |||
Deposits without stated maturities | 1,492,235 | 1,409,577 | |
Deposits with stated maturities | 252,040 | 300,762 | |
Federal Funds Purchased and Securities Sold under Agreements to Repurchase | 57,771 | 50,162 | |
Federal Home Loan Bank Borrowings, Fair Value Disclosure | 20,000 | ||
Subordinated Debt Obligations, Fair Value Disclosure | 29,245 | 29,158 | |
Accrued interest payable | 255 | 251 | |
Estimated Fair Value [Member] | |||
ASSETS | |||
Cash and cash equivalents | 38,924 | 105,330 | |
Mortgage loans AFS | 395 | 1,797 | |
Total loans | 1,225,669 | 1,296,841 | |
Less allowance for loan losses | 9,850 | 9,103 | |
Net loans | 1,215,819 | 1,287,738 | |
Accrued interest receivable | 7,472 | 5,804 | |
OMSR | 3,174 | 2,753 | |
LIABILITIES | |||
Deposits without stated maturities | 1,492,235 | 1,409,577 | |
Deposits with stated maturities | 240,964 | 301,216 | |
Federal Funds Purchased and Securities Sold under Agreements to Repurchase | 57,581 | 50,153 | |
Federal Home Loan Bank Borrowings, Fair Value Disclosure | 20,120 | ||
Subordinated Debt Obligations, Fair Value Disclosure | 26,365 | 27,435 | |
Accrued interest payable | $ 255 | $ 251 | |
[1]Due to the characteristics of equity securities without readily determinable fair values, they are not disclosed under a specific fair value hierarchy. When an impairment or write-down related to these securities is recorded, such amount would be classified as a nonrecurring Level 3 fair value adjustment |
Fair Value (Recorded amount of
Fair Value (Recorded amount of assets and liabilities measured at fair value) (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
AFS Securities | ||
Debt Securities, Available-for-sale | $ 580,481 | $ 490,601 |
Fair value, total | 598,063 | 509,624 |
Level 1 [Member] | ||
AFS Securities | ||
Fair value, total | $ 0 | $ 0 |
Percent of assets and liabilities measured at fair value | 0% | 0% |
Level 2 [Member] | ||
AFS Securities | ||
Fair value, total | $ 580,481 | $ 490,601 |
Percent of assets and liabilities measured at fair value | 97.06% | 96.27% |
Level 3 [Member] | ||
AFS Securities | ||
Fair value, total | $ 17,582 | $ 19,023 |
Percent of assets and liabilities measured at fair value | 2.94% | 3.73% |
Recurring items [Member] | ||
AFS Securities | ||
Debt Securities, Available-for-sale | $ 580,481 | $ 490,601 |
Recurring items [Member] | States and political subdivisions [Member] | ||
AFS Securities | ||
Debt Securities, Available-for-sale | 117,512 | 121,205 |
Recurring items [Member] | Auction rate money market preferred [Member] | ||
AFS Securities | ||
Debt Securities, Available-for-sale | 2,342 | 3,242 |
Recurring items [Member] | Mortgage-backed securities [Member] | ||
AFS Securities | ||
Debt Securities, Available-for-sale | 39,070 | 56,148 |
Recurring items [Member] | Collateralized mortgage obligations [Member] | ||
AFS Securities | ||
Debt Securities, Available-for-sale | 205,728 | 92,301 |
Recurring items [Member] | Corporate Debt Securities | ||
AFS Securities | ||
Debt Securities, Available-for-sale | 7,128 | 8,002 |
Recurring items [Member] | US Treasury Securities | ||
AFS Securities | ||
Debt Securities, Available-for-sale | 208,701 | 209,703 |
Recurring items [Member] | Level 1 [Member] | ||
AFS Securities | ||
Debt Securities, Available-for-sale | 0 | 0 |
Recurring items [Member] | Level 1 [Member] | States and political subdivisions [Member] | ||
AFS Securities | ||
Debt Securities, Available-for-sale | 0 | 0 |
Recurring items [Member] | Level 1 [Member] | Auction rate money market preferred [Member] | ||
AFS Securities | ||
Debt Securities, Available-for-sale | 0 | 0 |
Recurring items [Member] | Level 1 [Member] | Mortgage-backed securities [Member] | ||
AFS Securities | ||
Debt Securities, Available-for-sale | 0 | 0 |
Recurring items [Member] | Level 1 [Member] | Collateralized mortgage obligations [Member] | ||
AFS Securities | ||
Debt Securities, Available-for-sale | 0 | 0 |
Recurring items [Member] | Level 1 [Member] | Corporate Debt Securities | ||
AFS Securities | ||
Debt Securities, Available-for-sale | 0 | 0 |
Recurring items [Member] | Level 1 [Member] | US Treasury Securities | ||
AFS Securities | ||
Debt Securities, Available-for-sale | 0 | 0 |
Recurring items [Member] | Level 2 [Member] | ||
AFS Securities | ||
Debt Securities, Available-for-sale | 580,481 | 490,601 |
Recurring items [Member] | Level 2 [Member] | States and political subdivisions [Member] | ||
AFS Securities | ||
Debt Securities, Available-for-sale | 117,512 | 121,205 |
Recurring items [Member] | Level 2 [Member] | Auction rate money market preferred [Member] | ||
AFS Securities | ||
Debt Securities, Available-for-sale | 2,342 | 3,242 |
Recurring items [Member] | Level 2 [Member] | Mortgage-backed securities [Member] | ||
AFS Securities | ||
Debt Securities, Available-for-sale | 39,070 | 56,148 |
Recurring items [Member] | Level 2 [Member] | Collateralized mortgage obligations [Member] | ||
AFS Securities | ||
Debt Securities, Available-for-sale | 205,728 | 92,301 |
Recurring items [Member] | Level 2 [Member] | Corporate Debt Securities | ||
AFS Securities | ||
Debt Securities, Available-for-sale | 7,128 | 8,002 |
Recurring items [Member] | Level 2 [Member] | US Treasury Securities | ||
AFS Securities | ||
Debt Securities, Available-for-sale | 208,701 | 209,703 |
Recurring items [Member] | Level 3 [Member] | ||
AFS Securities | ||
Debt Securities, Available-for-sale | 0 | 0 |
Recurring items [Member] | Level 3 [Member] | States and political subdivisions [Member] | ||
AFS Securities | ||
Debt Securities, Available-for-sale | 0 | 0 |
Recurring items [Member] | Level 3 [Member] | Auction rate money market preferred [Member] | ||
AFS Securities | ||
Debt Securities, Available-for-sale | 0 | 0 |
Recurring items [Member] | Level 3 [Member] | Mortgage-backed securities [Member] | ||
AFS Securities | ||
Debt Securities, Available-for-sale | 0 | 0 |
Recurring items [Member] | Level 3 [Member] | Collateralized mortgage obligations [Member] | ||
AFS Securities | ||
Debt Securities, Available-for-sale | 0 | 0 |
Recurring items [Member] | Level 3 [Member] | Corporate Debt Securities | ||
AFS Securities | ||
Debt Securities, Available-for-sale | 0 | 0 |
Recurring items [Member] | Level 3 [Member] | US Treasury Securities | ||
AFS Securities | ||
Debt Securities, Available-for-sale | 0 | 0 |
Nonrecurring items [Member] | ||
AFS Securities | ||
Impaired loans (net of the allowance for loan losses) | 17,143 | 18,812 |
Foreclosed assets | 439 | 211 |
Nonrecurring items [Member] | Level 1 [Member] | ||
AFS Securities | ||
Impaired loans (net of the allowance for loan losses) | 0 | 0 |
Foreclosed assets | 0 | 0 |
Nonrecurring items [Member] | Level 2 [Member] | ||
AFS Securities | ||
Impaired loans (net of the allowance for loan losses) | 0 | 0 |
Foreclosed assets | 0 | 0 |
Nonrecurring items [Member] | Level 3 [Member] | ||
AFS Securities | ||
Impaired loans (net of the allowance for loan losses) | 17,143 | 18,812 |
Foreclosed assets | $ 439 | $ 211 |
Fair Value (Changes in fair val
Fair Value (Changes in fair value of assets and liabilities) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
OMSR Impairment | $ (532) | $ 0 | $ 316 |
Foreclosed Asset | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Change in fair value recorded through earnings | $ 6 | $ 0 |
Related Party Transactions (Ann
Related Party Transactions (Annual activity) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Annual activity | ||
Balance, January 1 | $ 22,558 | $ 2,977 |
New loans | 1,829 | 43,264 |
Repayments | (3,424) | (23,683) |
Balance, December 31 | $ 20,963 | $ 22,558 |
Related Party Transactions (End
Related Party Transactions (Ending balances of, and contributions to the Isabella Bank Foundation) (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Related Party Transaction [Line Items] | |||
Ending assets | $ 2,030,267 | $ 2,032,158 | |
Affiliated Entity [Member] | Isabella Bank Foundation [Member] | |||
Related Party Transaction [Line Items] | |||
Common Stock, Shares Held by Related Party | 20,000 | 20,000 | |
Affiliated Entity [Member] | Isabella Bank Foundation [Member] | |||
Related Party Transaction [Line Items] | |||
Ending assets | $ 1,385 | $ 1,511 | $ 1,286 |
Donations | $ 50 | $ 50 | $ 0 |
Related Party Transactions (Nar
Related Party Transactions (Narrative) (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Principal Officers and Directors and Their Affiliates [Member] | ||
Related Party Transaction [Line Items] | ||
Total deposits | $ 12,317 | $ 15,268 |
Affiliated Entity [Member] | Isabella Bank Foundation [Member] | ||
Related Party Transaction [Line Items] | ||
Common Stock, Shares Held by Related Party | 20,000 | 20,000 |
Operating Segments (Narrative)
Operating Segments (Narrative) (Details) | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Segment Reporting [Abstract] | |||
Percentage of reportable segments total assets and operating results, or more | 90% | 90% | 90% |
Parent Company Only Financial_3
Parent Company Only Financial Information (Interim Condensed Balance Sheets) (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
ASSETS | ||||
Property, Plant and Equipment, Net | $ 25,553 | $ 24,419 | ||
Ending assets | 2,030,267 | 2,032,158 | ||
LIABILITIES AND SHAREHOLDERS' EQUITY | ||||
Subordinated Debt | 29,245 | 29,158 | ||
Shareholders' equity | 186,210 | 211,048 | $ 218,588 | $ 210,182 |
Liabilities and Equity, Total | 2,030,267 | 2,032,158 | ||
Parent Company [Member] | ||||
ASSETS | ||||
Cash on deposit at subsidiary Bank | 8,525 | 11,535 | ||
Investments in subsidiaries | 158,125 | 178,395 | ||
Property, Plant and Equipment, Net | 1,171 | 1,482 | ||
Other assets | 47,922 | 48,923 | ||
Ending assets | 215,743 | 240,335 | ||
LIABILITIES AND SHAREHOLDERS' EQUITY | ||||
Subordinated Debt | 29,245 | 29,158 | ||
Other liabilities | 288 | 129 | ||
Shareholders' equity | 186,210 | 211,048 | ||
Liabilities and Equity, Total | $ 215,743 | $ 240,335 |
Parent Company Only Financial_4
Parent Company Only Financial Information (Interim Condensed Statements of Income) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Income | |||
Noncontrolling Interest in Net Income (Loss) Joint Venture Partners | $ 0 | $ 0 | $ 577 |
Expenses | |||
Interest Expense | 5,317 | 7,412 | 13,825 |
Occupancy, Net | 3,691 | 3,661 | 3,557 |
Professional Fees | 2,358 | 2,066 | 1,836 |
Noninterest Expense Directors Fees | 790 | 703 | 695 |
Other | 12,236 | 10,822 | 10,474 |
Federal income tax benefit | (4,606) | (3,848) | (987) |
Net Income (Loss) Attributable to Parent | 22,238 | 19,499 | 10,885 |
Parent Company [Member] | |||
Income | |||
Dividends from subsidiaries | 6,000 | 3,600 | 9,300 |
Interest income | 15 | 12 | 1 |
Noncontrolling Interest in Net Income (Loss) Joint Venture Partners | 0 | 0 | 577 |
Other Income | 14 | 17 | 0 |
Total income | 6,029 | 3,629 | 9,878 |
Expenses | |||
Interest Expense | 1,065 | 615 | 5 |
Occupancy, Net | 67 | 67 | 61 |
Professional Fees | 522 | 590 | 573 |
Noninterest Expense Directors Fees | 417 | 352 | 356 |
Other | 1,172 | 1,145 | 1,167 |
Total expenses | 3,243 | 2,769 | 2,162 |
Income before income tax benefit and equity in undistributed earnings of subsidiaries | 2,786 | 860 | 7,716 |
Federal income tax benefit | 670 | 500 | 216 |
Income before equity in undistributed earnings of subsidiaries | 3,456 | 1,360 | 7,932 |
Undistributed earnings of subsidiaries | 18,782 | 18,139 | 2,953 |
Net Income (Loss) Attributable to Parent | $ 22,238 | $ 19,499 | $ 10,885 |
Parent Company Only Financial_5
Parent Company Only Financial Information (Interim Condensed Statements of Cash Flows) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Operating activities | |||
Net Income (Loss) Attributable to Parent | $ 22,238 | $ 19,499 | $ 10,885 |
Adjustments to reconcile net income to cash provided by operations | |||
Amortization of Debt Issuance Costs | 87 | 52 | 0 |
Undistributed earnings of equity securities without readily determinable fair values | 0 | 0 | (394) |
Loss on sale of joint venture investment | 0 | 0 | 394 |
Depreciation | 2,071 | 2,314 | 2,620 |
Net amortization of AFS securities | 2,018 | 2,233 | 2,044 |
Deferred Income Tax Expense (Benefit) | 13 | (523) | (276) |
Changes in operating assets and liabilities which used cash | |||
Other assets | (2,813) | 1,208 | (821) |
Accrued interest and other liabilities | 2,182 | 146 | 398 |
Net cash provided by (used in) operating activities | 26,937 | 25,501 | 21,997 |
Payments to Acquire Equity Method Investments | 250 | 0 | 0 |
Investing activities | |||
Proceeds from Divestiture of Interest in Joint Venture | 0 | 0 | 1,000 |
Purchases of equipment and premises | (3,205) | (1,593) | (1,518) |
Net cash provided by (used in) investing activities | (106,255) | (229,635) | 45,133 |
Financing activities | |||
Cash dividends paid on common stock | (8,082) | (8,367) | (8,524) |
Proceeds from the issuance of common stock | 1,762 | 1,593 | 4,185 |
Common stock repurchased | (1,124) | (13,758) | (2,702) |
Common stock purchased for deferred compensation obligations | (1,189) | (1,187) | (1,592) |
Net cash provided by (used in) financing activities | 12,912 | 62,824 | 118,938 |
Increase (decrease) in cash and cash equivalents | (66,406) | (141,310) | 186,068 |
Cash and cash equivalents at beginning of period | 105,330 | 246,640 | 60,572 |
Cash and cash equivalents at end of period | 38,924 | 105,330 | 246,640 |
Proceeds from Issuance of Subordinated Long-term Debt | 0 | 29,106 | 0 |
Isabella Bank Corporation and Related Companies Deferred Compensation Plan for Directors | |||
Adjustments to reconcile net income to cash provided by operations | |||
Share-based payment awards | 463 | 433 | 413 |
Isabella Bank Corporation Restricted Stock Plan | |||
Adjustments to reconcile net income to cash provided by operations | |||
Share-based payment awards | 147 | 86 | 14 |
Parent Company [Member] | |||
Operating activities | |||
Net Income (Loss) Attributable to Parent | 22,238 | 19,499 | 10,885 |
Adjustments to reconcile net income to cash provided by operations | |||
Undistributed earnings of subsidiaries | (18,782) | (18,139) | (2,953) |
Amortization of Debt Issuance Costs | 87 | 52 | 0 |
Undistributed earnings of equity securities without readily determinable fair values | 0 | 0 | (394) |
Loss on sale of joint venture investment | 0 | 0 | 394 |
Depreciation | 50 | 50 | 47 |
Deferred Income Tax Expense (Benefit) | (133) | (267) | 351 |
Changes in operating assets and liabilities which used cash | |||
Other assets | 1,383 | (304) | 183 |
Accrued interest and other liabilities | 160 | 70 | 40 |
Net cash provided by (used in) operating activities | 5,613 | 1,480 | 8,980 |
Payments to Acquire Equity Method Investments | (250) | 0 | 0 |
Investing activities | |||
Proceeds from Divestiture of Interest in Joint Venture | 0 | 0 | 1,000 |
Purchases of equipment and premises | 260 | (2) | (37) |
Net cash provided by (used in) investing activities | 10 | (2) | 963 |
Financing activities | |||
Cash dividends paid on common stock | (8,082) | (8,367) | (8,524) |
Proceeds from the issuance of common stock | 1,762 | 1,593 | 4,185 |
Common stock repurchased | (1,124) | (13,758) | (2,702) |
Common stock purchased for deferred compensation obligations | (1,189) | (1,187) | (1,592) |
Net cash provided by (used in) financing activities | (8,633) | 7,387 | (8,633) |
Increase (decrease) in cash and cash equivalents | (3,010) | 8,865 | 1,310 |
Cash and cash equivalents at beginning of period | 11,535 | 2,670 | 1,360 |
Cash and cash equivalents at end of period | 8,525 | 11,535 | 2,670 |
Proceeds from Issuance of Subordinated Long-term Debt | 0 | 29,106 | 0 |
Parent Company [Member] | Isabella Bank Corporation and Related Companies Deferred Compensation Plan for Directors | |||
Adjustments to reconcile net income to cash provided by operations | |||
Share-based payment awards | 463 | 433 | 413 |
Parent Company [Member] | Isabella Bank Corporation Restricted Stock Plan | |||
Adjustments to reconcile net income to cash provided by operations | |||
Share-based payment awards | $ 147 | $ 86 | $ 14 |