Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Mar. 19, 2024 | Jun. 30, 2023 | |
Document and Entity Information | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2023 | ||
Document Transition Report | false | ||
Entity File Number | 0-24047 | ||
Entity Registrant Name | GLEN BURNIE BANCORP | ||
Entity Incorporation, State or Country Code | MD | ||
Entity Tax Identification Number | 52-1782444 | ||
Entity Address, Address Line One | 101 Crain Highway, S.E. | ||
Entity Address, City or Town | Glen Burnie | ||
Entity Address, State or Province | MD | ||
Entity Address, Postal Zip Code | 21061 | ||
City Area Code | 410 | ||
Local Phone Number | 766-3300 | ||
Entity Well-Known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 18,633,717 | ||
Entity Common Stock Shares Outstanding | 2,887,467 | ||
Auditor Name | UHY LLP | ||
Auditor Firm ID | 1195 | ||
Auditor Location | Salisbury, Maryland | ||
Entity Central Index Key | 0000890066 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Fiscal Year Focus | 2023 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false | ||
Document Financial Statement Error Correction [Flag] | false | ||
Common Stock | |||
Document and Entity Information | |||
Title of 12(g) Security | Common Stock, $1.00 par value | ||
Common Stock Purchase Rights | |||
Document and Entity Information | |||
Title of 12(g) Security | Common Stock Purchase Rights |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
ASSETS | ||
Cash and due from banks | $ 1,940 | $ 2,035 |
Interest-bearing deposits in other financial institutions | 13,301 | 28,057 |
Cash and Cash Equivalents | 15,241 | 30,092 |
Investment securities available for sale, at fair value | 139,427 | 144,133 |
Restricted equity securities, at cost | 1,217 | 221 |
Loans, net of deferred fees and costs | 176,307 | 186,440 |
Less: Allowance for credit losses | (2,157) | (2,162) |
Loans, net | 174,150 | 184,278 |
Premises and equipment, net | 3,046 | 3,277 |
Bank owned life insurance | 8,657 | 8,493 |
Deferred tax assets, net | 7,897 | 8,902 |
Accrued interest receivable | 1,192 | 1,159 |
Accrued taxes receivable | 121 | |
Prepaid expenses | 475 | 493 |
Other assets | 390 | 388 |
Total Assets | 351,813 | 381,436 |
LIABILITIES | ||
Noninterest-bearing deposits | 116,922 | 143,262 |
Interest-bearing deposits | 183,145 | 219,685 |
Total Deposits | 300,067 | 362,947 |
Short-term borrowings | 30,000 | |
Defined pension liability | 324 | 317 |
Accrued taxes payable | 151 | |
Accrued expenses and other liabilities | 2,097 | 1,967 |
Total Liabilities | 332,488 | 365,382 |
STOCKHOLDERS' EQUITY | ||
Common stock, par value $1, authorized 15,000,000 shares, issued and outstanding 2,882,627 and 2,865,046 shares as of December 31, 2023 and December 31, 2022, respectively. | 2,883 | 2,865 |
Additional paid-in capital | 10,964 | 10,862 |
Retained earnings | 23,859 | 23,579 |
Accumulated other comprehensive loss | (18,381) | (21,252) |
Total Stockholders' Equity | 19,325 | 16,054 |
Total Liabilities and Stockholders' Equity | $ 351,813 | $ 381,436 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parentheticals) - $ / shares | Dec. 31, 2023 | Dec. 31, 2022 |
CONSOLIDATED BALANCE SHEETS | ||
Common stock, par value (in dollars per share) | $ 1 | $ 1 |
Common stock, shares authorized | 15,000,000 | 15,000,000 |
Common stock, shares issued | 2,882,627 | 2,865,046 |
Common stock, shares outstanding | 2,882,627 | 2,865,046 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME - USD ($) | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
INTEREST INCOME | ||
Interest and fees on loans | $ 8,559,000 | $ 8,437,000 |
Interest and dividends on securities | 4,147,000 | 3,403,000 |
Interest on deposits with banks and federal funds sold | 631,000 | 872,000 |
Total Interest Income | 13,337,000 | 12,712,000 |
INTEREST EXPENSE | ||
Interest on deposits | 513,000 | 471,000 |
Interest on short-term borrowings | 689,000 | 348,000 |
Interest on long-term borrowings | 34,000 | |
Total Interest Expense | 1,202,000 | 853,000 |
Net Interest Income | 12,135,000 | 11,859,000 |
Provision/(release) of credit loss allowance | 96,000 | (112,000) |
Net interest income after provision/release for credit losses | 12,039,000 | 11,971,000 |
NONINTEREST INCOME | ||
Service charges on deposit accounts | 159,000 | 159,000 |
Other fees and commissions | 777,000 | 831,000 |
Gain on securities called or sold | 2,000 | |
Income on life insurance | 164,000 | 156,000 |
Gain on swap contract termination | 0 | 206,000 |
Total Noninterest Income | 1,100,000 | 1,354,000 |
NONINTEREST EXPENSE | ||
Salary and employee benefits | 6,710,000 | 6,406,000 |
Occupancy and equipment expenses | 1,294,000 | 1,272,000 |
Legal, accounting and other professional fees | 993,000 | 1,044,000 |
Data processing and item processing services | 1,005,000 | 997,000 |
FDIC insurance costs | 163,000 | 112,000 |
Advertising and marketing related expenses | 97,000 | 86,000 |
Loan collection costs | 22,000 | (39,000) |
Telephone costs | 151,000 | 159,000 |
Other expenses | 1,203,000 | 1,303,000 |
Total Noninterest Expenses | 11,638,000 | 11,340,000 |
Income before income taxes | 1,501,000 | 1,985,000 |
Income tax expense | 72,000 | 240,000 |
NET INCOME | $ 1,429,094 | $ 1,745,182 |
Basic net income per share of common stock (in dollars per share) | $ 0.50 | $ 0.61 |
Diluted net income per share of common stock (in dollars per share) | $ 0.50 | $ 0.61 |
CONSOLIDATED STATEMENT OF COMPR
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (LOSS) - USD ($) | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (LOSS) | ||
Net Income (Loss) | $ 1,429,094 | $ 1,745,182 |
Net unrealized loss on securities available for sale: | ||
Net unrealized gain (loss) on securities during the period | 3,961,000 | (28,555,000) |
Income tax (expense) benefit relating to item above | (1,090,000) | 7,858,000 |
Reclassification adjustment for gain on sales of securities included in net income | (1,000) | |
Net effect on other comprehensive income (loss) | 2,871,000 | (20,698,000) |
Net unrealized gain on interest rate swap: | ||
Net unrealized gain on interest rate swap during the period | 441,000 | |
Income tax expense relating to item above | (121,000) | |
Net effect on other comprehensive income (loss) | 320,000 | |
Other comprehensive income (loss) | 2,871,000 | (20,378,000) |
Comprehensive income (loss) | $ 4,300,000 | $ (18,633,000) |
CONSOLIDATED STATEMENT OF CHANG
CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY - USD ($) | Common Stock | Additional Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive (Loss) Income | Total |
Balances at Dec. 31, 2021 | $ 2,854,000 | $ 10,759,000 | $ 22,977,000 | $ (874,000) | $ 35,716,000 |
Increase (Decrease) in Stockholders' Equity | |||||
Net income | 1,745,000 | 1,745,182 | |||
Cash dividends, $0.40 per share | (1,143,000) | (1,143,000) | |||
Dividends reinvested under dividend reinvestment plan | 11,000 | 103,000 | 114,000 | ||
Other comprehensive income | (20,378,000) | (20,378,000) | |||
Balances at Dec. 31, 2022 | 2,865,000 | 10,862,000 | 23,579,000 | (21,252,000) | 16,054,000 |
Increase (Decrease) in Stockholders' Equity | |||||
Net income | 1,429,000 | 1,429,094 | |||
Cash dividends, $0.40 per share | (1,149,000) | (1,149,000) | |||
Dividends reinvested under dividend reinvestment plan | 18,000 | 102,000 | 120,000 | ||
Other comprehensive income | 2,871,000 | 2,871,000 | |||
Balances at Dec. 31, 2023 | $ 2,883,000 | $ 10,964,000 | $ 23,859,000 | $ (18,381,000) | $ 19,325,000 |
CONSOLIDATED STATEMENT OF CHA_2
CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY (Parentheticals) - $ / shares | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY | ||
Cash dividends, per share | $ 0.40 | $ 0.40 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Cash flows from operating activities: | ||
Net income | $ 1,429 | $ 1,745 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation, amortization, and accretion of premises and equipment | 119 | 994 |
Provision/(release) of credit loss allowance | 96 | (112) |
Deferred income taxes, net | (84) | (210) |
Gain on termination of swap contracts | 206 | |
Increase in cash surrender value of bank owned life insurance | (164) | (156) |
Loss on write-down of Maryland Financial Bank stock | 3 | |
Decrease in ground rents | 1 | |
Increase in accrued interest receivable | (33) | (73) |
Net (increase) decrease in other assets | (106) | 215 |
Net increase (decrease) in accrued expenses and other liabilities | 141 | (387) |
Net cash provided by operating activities | 1,399 | 2,225 |
Cash flows from investing activities: | ||
Redemptions, sales and maturities of investment securities available for sale | 18,523 | 14,214 |
Purchases of investment securities available for sale | (9,747) | (31,540) |
Net (purchase) redemption of Federal Home Loan Bank stock | (996) | 839 |
Net decrease in loans | 10,032 | 23,757 |
Purchases of premises and equipment | (152) | (256) |
Net cash provided by investing activities | 17,660 | 7,014 |
Cash flows from financing activities: | ||
Net decrease in deposits | (62,881) | (20,299) |
Net increase (decrease) in short term borrowings | 30,000 | (10,000) |
Decrease in long term borrowings | (10,000) | |
Cash dividends paid | (1,149) | (1,143) |
Common stock dividends reinvested | 120 | 114 |
Net cash used in financing activities | (33,910) | (41,328) |
Net decrease in cash and cash equivalents | (14,851) | (32,089) |
Cash and cash equivalents at beginning of year | 30,092 | 62,181 |
Cash and cash equivalents at end of year | 15,241 | 30,092 |
Supplemental Disclosures of Cash Flow Information: | ||
Interest paid on deposits and borrowings | 1,127 | 856 |
Income taxes paid | 436 | |
Net decrease (increase) in unrealized depreciation on available for sale securities | $ (3,961) | 28,556 |
Decrease in unrealized depreciation on Swaps | $ 441 |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2023 | |
Summary of Significant Accounting Policies | |
Summary of Significant Accounting Policies | Note 1. Summary of Significant Accounting Policies Nature of Business Glen Burnie Bancorp (the “Company”) is a bank holding company organized in 1990 under the laws of the State of Maryland. The Company owns all outstanding shares of capital stock of The Bank of Glen Burnie (the “Bank”), a commercial bank organized in 1949 under the laws of the State of Maryland (the “State”). The Bank provides financial services to individuals and corporate customers located in Anne Arundel County and surrounding areas of Central Maryland, and is subject to competition from other financial institutions. The Bank is also subject to the regulations of certain Federal and State agencies and undergoes periodic examinations by those regulatory authorities. The accounting and financial reporting policies of the Bank conform, in all material respects, to accounting principles generally accepted in the United States (“U.S. GAAP”) and to general practices within the banking industry. Basis of Presentation The consolidated financial statements include the accounts of Glen Burnie Bancorp, The Bank of Glen Burnie and GBB Properties, Inc., a company engaged in the acquisition and disposition of other real estate. All significant intercompany transactions are eliminated in consolidation and certain reclassifications are made when necessary in order to conform the previous year’s financial statements to the current year’s presentation. In preparing the consolidated financial statements, the Company is required to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the financial statements and revenues and expenses during the reporting periods and related disclosures. These estimates that require application of management's subjective or complex judgments often result in the need to make estimates about the effect of matters that are inherently uncertain and may change in future periods. Management has made significant estimates in several areas, including the Loans and Allowance for Credit Losses Loans and Allowance for Credit Losses Investment Securities Fair Value of Financial Instruments Pension and Profit Sharing Plans Income Taxes ). Certain amounts in the financial statements from prior periods have been reclassified to conform to the current financial statement presentation. The Parent Only financial statements (see Note 18, Parent Company Financial Information Investment Securities We classify investment securities as trading, held to maturity ("HTM"), or available for sale ("AFS") at the date of acquisition. Purchases and sales of securities are generally recorded on a trade-date basis. Investment securities that we might not hold until maturity are classified as AFS and are reported at fair value in the statement of financial condition. Fair value measurement is based upon quoted market prices in active markets, if available. If quoted prices in active markets are not available, fair value is measured using pricing models or other model-based valuation techniques such as the present value of future cash flows, which consider prepayment assumptions and other factors such as credit losses and market liquidity. Unrealized gains and losses are excluded from earnings and reported, net of tax, in other comprehensive income (“OCI”). Purchase premiums and discounts are recognized in interest income using the effective interest method over the life of the securities. Purchase premiums or discounts related to mortgage-backed securities are amortized or accreted using projected prepayment speeds. Gains and losses on the sale of securities are recorded on the trade date and are determined using the specific identification method. Debt securities are classified as HTM if the Company has both the intent and ability to hold those securities to maturity regardless of changes in market conditions, liquidity needs or changes in general economic conditions. These securities are carried at cost adjusted for amortization of purchase premiums and accretion of purchase discounts. Transfers of securities from available for sale to held to maturity are accounted for at fair value as of the date of the transfer. The difference between the fair value and the par value at the date of transfer is considered a premium or discount and is accounted for accordingly. Any unrealized gain or loss at the date of the transfer is reported in OCI, and is amortized over the remaining life of the security as an adjustment of yield in a manner consistent with the amortization of any premium or discount, and will offset or mitigate the effect on interest income of the amortization of the premium or discount for that held to maturity security. Impairment may result from credit deterioration of the issuer or collateral underlying the security. In performing an assessment of recoverability, all relevant information is considered, including the length of time and extent to which fair value has been less than the amortized cost basis, the cause of the price decline, credit performance of the issuer and underlying collateral, and recoveries or further declines in fair value subsequent to the balance sheet date. AFS debt securities are measured at fair value rather than amortized cost. Although ASC 326 replaced the legacy other-than-temporary impairment (“OTTI”) model with a credit loss model, it retained the fundamental nature of the legacy OTTI model. For AFS debt securities in an unrealized loss position, the Company first assesses whether it intends to sell, or it is more likely than not that it will be required to sell, the security before recovery of its amortized cost basis. If either criteria is met, the security’s amortized cost basis is written down to fair value through income. For AFS debt securities where neither of the criteria are met, the Company evaluates whether the decline in fair value has resulted from credit losses or other factors. In making this assessment, management considers the extent to which fair value is less than amortized cost, any changes to the credit rating of the security by a rating agency, and adverse conditions specifically related to the security, among other factors. If this assessment indicates that a credit loss exists, the present value of cash flows expected to be collected from the security is compared to the amortized cost basis of the security. If the present value of cash flows expected to be collected is less than the amortized cost basis, a credit loss exists and an allowance for credit losses is recorded for the credit loss, limited to the amount that the fair value is less than the amortized cost basis. Any remaining discount that has not been recorded through an allowance for credit losses is recognized in other comprehensive income. Under the new guidance, an entity may no longer consider the length of time fair value has been less than amortized cost. Changes in the allowance for credit losses are recorded as a provision for (or release of) credit losses. Losses are charged against the allowance when management believes the collectability of an AFS security is considered below the amortized cost basis of the security. As of December 31, 2023 and 2022, the Company determined that the unrealized loss positions in AFS securities were not the result of credit losses, and therefore, an allowance for credit losses was not recorded. Federal Home Loan Bank Stock As a borrower from the Federal Home Loan Bank of Atlanta ("FHLB"), the Bank is required to purchase an amount of FHLB stock based on our outstanding borrowings with the FHLB. This stock is used as collateral to secure the borrowings from the FHLB and is accounted for as a cost-method investment. FHLB stock is an equity interest that does not necessarily have a readily determinable fair value for purposes of the ASC Topic 320, Accounting for Certain Investments in Debt and Equity Securities , because its ownership is restricted and lacks a market. FHLB stock can be sold back only at its par value of Loans Held for Investment Loans held for investment are reported at the principal amount outstanding, net of cumulative charge-offs, interest applied to principal (for loans accounted for using the cost recovery method), unamortized net deferred loan origination fees and costs and unamortized premiums or discounts on purchased loans. Interest on loans is accrued and recognized as interest income at the contractual rate of interest. When a loan is designated as held for investment, the intent is to hold these loans for the foreseeable future or until maturity or pay off. From time to time, the Company will originate loans to facilitate the sale of other real estate owned (OREO). Such loans are accounted for using the installment method and any gain on sale is deferred. The Bank financed Loan Fees and Costs Loan origination fees, commitment fees, direct loan origination costs and purchase premiums and discounts on loans are deferred and recognized as an adjustment of yield, to be amortized to interest income over the contractual term of the loan. Nonaccrual Loans Loans are placed on nonaccrual status when the full and timely collection of principal and interest is doubtful, generally when the loan becomes 90 days or more past due for principal or interest payment or if part of the principal balance has been charged off. When a loan is placed on nonaccrual status all interest previously accrued but not collected is reversed against current period interest income. All payments received on nonaccrual loans are accounted for using the cost recovery method. Under the cost recovery method, all cash collected is applied to first reduce the principal balance. A loan may be returned to accrual status if all delinquent principal and interest payments are brought current and the collectability of the remaining principal and interest payments in accordance with the loan agreement is reasonably assured. Loans that are well-secured and in the process of collection are maintained on accrual status, even if they are 90 days or more past due. Impaired Loans A loan is considered impaired when it is probable that all contractual principal and interest payments due will not be collected in accordance with the terms of the loan agreement. Factors considered by management in determining whether a loan is impaired include payment status, collateral value and the probability of collecting scheduled principal and interest payments when due. The carrying value of impaired loans is based on the present value of the loan’s expected future cash flows or, alternatively, the observable market price of the loan or the fair value of the collateral. Modifications with Borrowers Experiencing Financial Difficulty Management evaluates loan restructurings according to the accounting guidance for loan modifications. We may, for economic or legal reasons, grant a concession to a borrower experiencing financial difficulty that we would not otherwise consider. Management strives to identify borrowers in financial difficulty early and works with them to modify to more affordable terms before their loan reaches nonaccrual status. These modified terms may include rate reductions, principal forgiveness, payment forbearance and other actions intended to minimize the economic loss and to avoid foreclosure or repossession of the collateral. A restructuring that results in only an insignificant delay in payment is not considered a concession. A delay may be considered insignificant if the payments subject to the delay are insignificant relative to the unpaid principal or collateral value and the contractual amount due, or the delay in timing of the restructured payment period is insignificant relative to the frequency of payments, the debt's original contractual maturity or original expected duration. Loan modifications with borrowers experiencing financial difficulty are designated as impaired because interest and principal payments will not be received in accordance with the original contract terms. Loans that are performing and on accrual status as of the date of the modification remain on accrual status. Loans that are nonperforming as of the date of modification generally remain as nonaccrual until the prospect of future payments in accordance with the modified loan agreement is reasonably assured, generally demonstrated when the borrower maintains compliance with the restructured terms for a predetermined period, normally at least six months. Loans with temporary below-market concessions remain designated as a loan to borrower experiencing financial difficulty and impaired regardless of the accrual or performance status until the loan is paid off. However, if the loan has been modified in a subsequent restructure with market terms and the borrower is not currently experiencing financial difficulty, then the loan may be de-designated as being made to a borrower experiencing financial difficulty. Allowance for Credit Losses – Loans Receivable Effective January 1, 2021, the Company applied ASU 2016-13, Financial Instruments - Credit Losses ("ASC 326"), such that the allowance calculation is based on the CECL methodology. Prior to January 1, 2021, the calculation was based on incurred loss methodology. See Note 4, Loans and Allowance for Credit Losses for details. The Company maintains an allowance for credit losses (“ACL”) for the expected credit losses of the loan portfolio as well as unfunded loan commitments. The amount of ACL is based on ongoing, quarterly assessments by management. The CECL methodology requires an estimate of the credit losses expected over the life of an exposure (or pool of exposures) and replaces the incurred loss methodology’s threshold that delayed the recognition of a credit loss until it was probable a loss event was incurred. The ACL consists of the allowance for credit losses - loans and the reserve for unfunded commitments. The estimate of expected credit losses under the CECL methodology is based on relevant information about past events, current conditions, and reasonable and supportable forecasts that affect the collectability of the reported amounts. Historical loss experience is generally the starting point for estimating expected credit losses. We then consider whether the historical loss experience should be adjusted for asset-specific risk characteristics or current conditions at the reporting date that did not exist over the period that historical experience was based on for each loan type. Finally, we consider forecasts about future economic conditions or changes in collateral values that are reasonable and supportable. Portfolio segment is defined as the level at which the Company develops and documents a systematic methodology to determine its ACL. The Company has designated three loan portfolio segments: loans secured by real estate, commercial and industrial loans, and consumer loans. These loan portfolio segments are further disaggregated into classes, which represent loans of similar type, risk characteristics, and methods for monitoring and assessing credit risk. The loans secured by real estate portfolio segment is disaggregated into five classes: construction and land, farmland, single-family residential, multi-family, and commercial. The commercial and industrial loan portfolio segment is disaggregated into two classes: commercial and industrial, and SBA guaranty. The risk of loss for the commercial and industrial loan portfolio segment is generally most indicated by the credit risk rating assigned to each borrower. Commercial and industrial loan risk ratings are determined by experienced senior credit officers based on specific facts and circumstances and are subject to periodic review by an independent internal team of credit specialists. The consumer loan portfolio segment is disaggregated into two classes: consumer and automobile. The risk of loss for the consumer loan portfolio segment is generally most indicated by delinquency status and general economic factors. Each of the three loan portfolio segments may also be further segmented based on risk characteristics. For most of our loan portfolio classes, the historical loss experience is determined using the Average Charge-Off Method. This method pools loans into groups (“cohorts”) sharing similar risk characteristics and tracks each cohort’s net charge-offs over the lives of the loans. The Average Charge-Off Method uses historical values by period (20-year look-back) to calculate losses and then applies the historical average to future balances over the life of the account. The historical loss rates for each cohort are then averaged to calculate an overall historical loss rate which is applied to the current loan balance to arrive at the quantitative baseline portion of the allowance for credit losses for the respective loan portfolio class. For certain loan portfolio classes, the Company determined there was not sufficient historical loss information to calculate a meaningful historical loss rate using the average charge-off methodology. For any such loan portfolio class, peer group history contributes to the Company’s weighted average loss history. The peer group data is included in the weighted average loss history that is developed for each loan pool. The Company also considers qualitative adjustments to the historical loss rate for each loan portfolio class. The qualitative adjustments for each loan class consider the conditions over the 20-year look-back period from which historical loss experience was based and are split into two components: 1) asset or class specific risk characteristics or current conditions at the reporting date related to portfolio credit quality, remaining payments, volume and nature, credit culture and management, business environment or other management factors; and 2) reasonable and supportable forecast of future economic conditions and collateral values. The Company performs a quarterly asset quality review which includes a review of forecasted gross charge-offs and recoveries, nonperforming assets, criticized loans, risk rating migration, delinquencies, etc. The asset quality review is performed by management and the results are used to consider a qualitative overlay to the quantitative baseline. When management deems it to be appropriate, the Company establishes a specific reserve for individually evaluated loans that do not share similar risk characteristics with the loans included in each respective loan pool. These individually evaluated loans are removed from their respective pools and typically represent collateral dependent loans but may also include other non-performing loans or loan modifications to borrowers experiencing financial difficulty. Impaired Loans The specific credit allocations are based on regular analysis of all loans over a fixed-dollar amount where the internal credit rating is at or below a predetermined classification. When a loan is identified as impaired, impairment is measured based on net realizable value, and the recorded investment balance of the loan. For impaired loans, we recognize impairment if we determine that the net realizable value of the impaired loan is less than the recorded investment of the loan (net of previous charge-offs and deferred loan fees and costs), except when the sole remaining source of collection is the underlying collateral. In these cases, impairment is measured as the difference between the recorded investment balance of the loan and the fair value of the collateral. The fair value of the collateral is adjusted for the estimated cost to sell if repayment or satisfaction of a loan is dependent on the sale (rather than only on the operation) of the collateral. Once the impairment amount is determined, an asset-specific allowance is provided that is equal to the calculated impairment and included in the allowance for credit losses - loans. If the calculated impairment is determined to be permanent or not recoverable, the impairment will be charged off. Factors considered by management in determining if impairment is permanent or not recoverable include whether management judges the loan to be uncollectible, repayment is deemed to be protracted beyond reasonable time frames or the loss becomes evident owing to the borrower’s lack of assets. Estimate of Probable Credit Losses - Loans On January 1, 2021, the Company early adopted ASU 2016-13, Financial Instruments - Credit Losses (“ASC 326”) which replaces the “incurred loss approach” for estimating credit losses with an expected loss methodology. The incurred loss model delayed the recognition of credit losses until it was probable that a loss had occurred, while the CECL model requires the immediate recognition of expected credit losses over the contractual term for financial instruments that fall within the scope of CECL at the date of origination or purchase of the financial instrument. The CECL model, which is applicable to the measurement of credit losses on financial assets measured at amortized cost and certain off-balance sheet credit exposures, affects the Company’s estimates of the allowance for credit losses for our loan portfolio and the reserve for our off-balance sheet credit exposures related to loan commitments. The allowance for credit losses is established through a provision for credit losses charged to expense. Loans are charged against the allowance for credit losses when management believes that the collectability of the principal is unlikely. The allowance, based on all available information from internal and external sources, relevant to assessing the collectability of loans over their contractual terms, adjusted for expected prepayments when appropriate, is an amount that management believes will be adequate to absorb possible losses on existing loans that may become uncollectible. The evaluations are performed for each class of loans and take into consideration factors such as changes in the nature and volume of the loan portfolio, overall portfolio quality, review of specific problem loans, value of collateral securing the loans and current economic conditions and trends that may affect the borrowers’ ability to pay. For example, delinquencies in unsecured loans and indirect automobile installment loans will be reserved for at significantly higher ratios than loans secured by real estate. Finally, the Company considers forecasts about future economic conditions or changes in collateral values that are reasonable and supportable. Based on that analysis, the Bank deems its allowance for credit losses in proportion to the total nonaccrual loans and past due loans to be sufficient. Reserve for Unfunded Commitments The Company maintains a separate allowance for losses on unfunded loan commitments, which is included in accrued expenses and other liabilities on the consolidated statements of financial condition. The reserve for unfunded commitments (off-balance sheet financial instruments) is established through a provision for credit losses - unfunded commitments, the changes of which are recorded in noninterest expense. The reserve for unfunded commitments is an amount that management believes will be adequate to absorb probable losses inherent in existing commitments, including unused portions of revolving lines of credit and other loans, standby letters of credit, and unused deposit account overdraft privileges. The reserve for unfunded commitments is based on evaluations of the collectability, and prior loss experience of unfunded commitments. The evaluations take into consideration such factors as changes in the nature and size of the loan portfolio, overall loan portfolio quality, loan concentrations, specific problem loans and related unfunded commitments, and current economic conditions that may affect the borrower’s or depositor’s ability to pay. Other Real Estate Owned Other real estate owned ("OREO") represents real estate acquired in partial or total satisfaction of debts previously contracted with the Company, generally through the foreclosure of loans. These properties are initially recorded at the net realizable value (fair value of collateral less estimated costs to sell). Upon transfer of a loan to OREO, an appraisal is obtained and any excess of the loan balance over the net realizable value is charged against the allowance for credit losses - loans. Subsequent declines in net realizable value identified from the ongoing analysis of such properties as well as gains and losses realized from the sale of OREO are recognized in current period earnings within noninterest expense as foreclosed property expense. The net realizable value of these assets is reviewed and updated as circumstances warrant. Loans transferred to OREO through foreclosure proceedings totaled for the year ended December 31, 2022, and 2023. Premises and Equipment Bank premises and equipment are stated at cost less accumulated depreciation and depreciated over the estimated useful life of the related asset or the term of the lease using the straight-line method. Expenditures for improvements that extend the life of an asset are capitalized and depreciated over the asset’s remaining useful life. Gains or losses realized on the disposition of premises and equipment are reflected in the consolidated statements of income. Expenditures for repairs and maintenance are charged to occupancy and equipment expense as incurred. Computer software is recorded at cost and amortized over three . Management periodically evaluates the carrying value of long-lived assets and certain identifiable intangibles, including goodwill, furniture and equipment and leasehold improvements for impairment. Income Taxes Our income tax expense, and deferred tax assets and liabilities reflect management’s best assessment of estimated current and future taxes to be paid. Significant judgments and estimates are required in determining the consolidated income tax expense. Deferred income taxes arise from temporary differences between the tax basis of assets and liabilities and their reported amounts in the financial statements, which will result in taxable or deductible amounts in the future. Deferred tax assets and liabilities are reflected at currently enacted income tax rates applicable to the period in which the deferred tax assets or liabilities are expected to be realized or settled. As changes in tax laws or rates are enacted, deferred tax assets and liabilities are adjusted through the provision for income taxes and are reflected as discrete tax items in the Company’s tax provision. The Company records net deferred tax assets to the extent it is believed that these assets will more likely than not be realized. In making this determination, the Company considers all available evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax planning strategies, and recent financial operations. A tax position that meets the more likely than not recognition threshold is initially and subsequently measured as the largest amount of tax benefit that has a greater than 50% likelihood of being realized upon settlement with a taxing authority. The Company files a consolidated federal income tax return and separate company state tax returns. For a more detailed description of income taxes see Note 8, Income Taxes Interest Rate Swap Agreements For asset/liability management purposes, the Company periodically uses interest rate swap agreements to hedge various exposures or to modify interest rate characteristics of various balance sheet accounts. All interest rate swap agreements are recorded at fair value. The Company records cash flow hedges at the inception of the derivative contract based on the Company’s intentions and belief as to its likelihood of effectiveness as a hedge. Cash flow hedges represent a hedge of a forecasted transaction or the variability of cash flows to be received or paid related to a recognized asset or liability. For a cash flow hedge, the gain or loss on the derivative is reported in other comprehensive income and is reclassified into earnings in the same periods during which the hedged transaction affects earnings. The changes in the fair value of derivatives that are not highly effective in hedging the changes in fair value or expected cash flows of the hedged item are recognized immediately in current earnings. Changes in the fair value of derivatives that do not qualify for hedge accounting are reported currently in earnings, as noninterest income. Net cash settlements on derivatives that qualify for hedge accounting are recorded in interest income or interest expense, based on the item being hedged. Net cash settlements on derivatives that do not qualify for hedge accounting are reported in noninterest income. Cash flows on hedges are classified in the cash flow statement the same as the cash flows of the items being hedged. The Company formally documents the relationship between derivatives and hedged items, as well as the risk management objective and the strategy for undertaking hedge transactions at the inception of the hedging relationship. This documentation includes linking cash flow hedges to specific assets and liabilities on the balance sheet or to specific firm commitments or forecasted transactions. The Company also formally assesses, both at the hedge’s inception and on an ongoing basis, whether the derivative instruments that are used are highly effective in offsetting changes in fair values or cash flows of the hedged items. The Company discontinues hedge accounting when it determines that the derivative is no longer effective in offsetting changes in the fair value or cash flows of the hedged item, the derivative is settled or terminates, a hedged forecasted transaction is no longer probable, a hedged firm commitment is no longer firm, or treatment of the derivative as a hedge is no longer appropriate or intended. When hedge accounting is discontinued, subsequent changes in fair value of the derivative are recorded as noninterest income. We recognized a million gain on cancellation of interest rate swap contracts for the year ended December 31, 2022. There were cancellations of interest rate swap contracts during 2023. When a cash flow hedge is discontinued but the hedged cash flows or forecasted transactions are still expected to occur, gains or losses that were accumulated in other comprehensive income are amortized into earnings over the same periods which the hedged transactions will affect earnings. Fair Value Measurement The term "fair value" is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. A fair value measurement assumes that the transaction to sell the asset or transfer the liability occurs in the principal market for the asset or liability or, in the absence of a principal market, the most advantageous market for the asset or liability. The Company’s approach is to maximize the use of observable inputs and minimize the use of unobservable inputs when developing fair value measurements. The degree of management judgment involved in estimating the fair value of a financial instrument or other asset is dependent upon the availability of quoted market prices or observable market value inputs for internal valuation models used for estimating fair value. For financial instruments that are actively traded in the marketplace or whose values are based on readily available market data, little judgment is necessary when estimating the instrument’s fair value. When observable market prices and data are not readily available, significant management judgment often is necessary to estimate fair value. In those cases, different assumptions could result in significant changes in valuation. See Note 16, Fair Value Measurement. Cash and Cash Equivalents The Bank has included cash and due from banks, interest-bearing deposits in other financial institutions, and federal funds sold as cash and cash equivalents for the purpose of reporting cash flows. The carrying value of cash and cash equivalents approximates its fair value due to its short-term nature. Earnings Per Share Basic earnings per common share (“EPS”) is computed by dividing net income available to common shareholders by the weighted average common shares outstanding during the period. Diluted EPS is computed by dividing net income available to common shareholders by the weighted average common shares outstanding, plus the effect of common stock equivalents (for example, stock options computed using the t |
Restrictions on Cash and Amount
Restrictions on Cash and Amounts Due from Banks | 12 Months Ended |
Dec. 31, 2023 | |
Restrictions on Cash and Amounts Due from Banks | |
Restrictions on Cash and Amounts Due from Banks | Note 2. Restrictions on Cash and Amounts Due from Banks On March 26, 2020 the Board of Governors of the Federal Reserve System set the reserve requirement ratios to zero percent and reserve requirements were no longer administered. On December 22, 2020 the zero percent reserve requirement ratio was extended for three years. At December 31, 2023 and 2022, the average reserve balances were $0. |
Investment Securities
Investment Securities | 12 Months Ended |
Dec. 31, 2023 | |
Investment Securities | |
Investment Securities | Note 3. Investment Securities A summary of the amortized cost and market value of securities available for sale at December 31, 2023 and 2022 is as follows: At December 31, 2023 Gross Gross Amortized Unrealized Unrealized Fair (dollars in thousands) Cost Gains Losses Value Collateralized mortgage obligations $ 15,962 $ 8 $ (2,309) $ 13,661 Agency mortgage-backed securities 51,930 — (5,816) 46,114 Municipal securities 42,990 4 (9,265) 33,729 U.S. Government agency securities 45,406 — (7,712) 37,694 Corporate securities 1,500 — (216) 1,284 U.S. Treasury securities 6,999 — (54) 6,945 Total securities available for sale $ 164,787 $ 12 $ (25,372) $ 139,427 At December 31, 2022 Gross Gross Amortized Unrealized Unrealized Fair (dollars in thousands) Cost Gains Losses Value Collateralized mortgage obligations $ 17,596 $ 7 $ (2,348) $ 15,255 Agency mortgage-backed securities 58,801 — (6,908) 51,893 Municipal securities 43,092 1 (10,796) 32,297 U.S. Government agency securities 45,471 — (8,891) 36,580 Corporate securities 1,500 — (175) 1,325 U.S. Treasury securities 6,993 — (210) 6,783 Total securities available for sale $ 173,453 $ 8 $ (29,328) $ 144,133 Investment securities are accounted for according to their purpose and holding period. Trading securities are those that are bought and held principally for the purpose of selling them in the near term. The Company held trading securities at December 31, 2023 or December 31, 2022. Available-for-sale investment securities, comprised of debt and mortgage-backed securities, are those that may be sold before maturity due to changes in the Company's interest rate risk profile or funding needs, and are reported at fair value with unrealized gains and losses, net of taxes, reported as a component of other comprehensive income or loss. Held-to-maturity investment securities are those that management has the positive intent and ability to hold to maturity and are reported at amortized cost. The Company held Realized gains and losses are recorded in noninterest income and are determined on a trade date basis using the specific identification method. Interest and dividends on investment securities are recognized in interest income on an accrual basis. Premiums and discounts are amortized or accreted into interest income using the interest method over the expected lives of the individual securities. The following tables show the fair value and gross unrealized losses associated with the investment portfolio, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position as of December 31, 2023 and 2022: At December 31, 2023 Less than 12 months 12 months or more Total Fair Unrealized Fair Unrealized Fair Unrealized (dollars in thousands) Value Loss Value Loss Value Loss Collateralized mortgage obligations $ 492 $ (1) $ 11,927 $ (2,308) $ 12,419 $ (2,309) Agency mortgage-backed securities 5 — 46,109 (5,816) 46,114 (5,816) Municipal securities 2,978 (39) 28,667 (9,226) 31,645 (9,265) U.S. Government agency securities 220 (1) 37,474 (7,711) 37,694 (7,712) Corporate securities — — 1,284 (216) 1,284 (216) U.S. Treasury securities — — 6,944 (54) 6,944 (54) $ 3,695 $ (41) $ 132,405 $ (25,331) $ 136,100 $ (25,372) At December 31, 2022 Less than 12 months 12 months or more Total Fair Unrealized Fair Unrealized Fair Unrealized (dollars in thousands) Value Loss Value Loss Value Loss Collateralized mortgage obligations $ 8,315 $ (364) $ 6,127 $ (1,984) $ 14,442 $ (2,348) Agency mortgage-backed securities 20,029 (1,308) 31,865 (5,600) 51,894 (6,908) Municipal securities 18,456 (5,438) 13,340 (5,358) 31,796 (10,796) U.S. Government agency securities 13,526 (474) 22,767 (8,417) 36,293 (8,891) Corporate securities — — 1,325 (175) 1,325 (175) U.S. Treasury securities 6,783 (210) — — 6,783 (210) $ 67,109 $ (7,794) $ 75,424 $ (21,534) $ 142,533 $ (29,328) At December 31, 2023 and 2022, the Company did not have any securities that had impairment charges. The Company's investment securities portfolio consists primarily of debt securities issued by U.S. Government agencies, U.S. Government-sponsored agencies, Corporate securities, state governments and local municipalities. There were mortgage obligations ("CMO") held in the investment securities portfolio as of December 31, 2023 and December 31, 2022. The fair value of investment securities is impacted by interest rates, credit spreads, market volatility and liquidity conditions. Net unrealized gains and losses in the available for sale portfolio are included in shareholders' equity as a component of accumulated other comprehensive income or loss, net of tax. An unrealized loss exists when the current fair value of an individual security is less than the amortized cost basis. The Company does not believe that the available-for-sale debt securities that were in an unrealized loss position have any credit loss impairment upon adoption of ASC 326 on January 1, 2021 or as of December 31, 2023. As of December 31, 2023, the Company did not intend to sell the investment securities that were in an unrealized loss position. It is more likely than not that the Company will not be required to sell the investment securities before recovery of their amortized cost basis, which may be at maturity. Available-for-sale debt securities issued by U.S. government agencies or U.S. government sponsored enterprises carry the explicit and/or implicit guarantee of the U.S. government and have a long history of zero credit loss. Municipal bonds are considered to have issuer(s) of high credit quality (rated A or higher) and the decline in fair value is due to changes in interest rates and other market conditions. Corporate securities are non-rated investments that are booked as a debt security where rating agencies do not provide a rating. The absence of a rating does not imply substandard quality. Non-rated corporate securities may be purchased from issuers operating in and around the Company’s operating footprint. The issuer(s) continues to make timely principal and interest payments on the bonds. The fair value is expected to recover as the bond(s) approach maturity. The Company held fifty-seven U.S. Government agency, seventy-two collateralized mortgage obligations, one treasury security and eighty-three agency mortgage-backed securities that were in an unrealized loss position at December 31, 2023. Principal and interest payments of the underlying collateral for each of these securities are backed by U.S. Government sponsored agencies and carry minimal credit risk. Management found no evidence of credit loss impairment on any of these securities and believes the unrealized losses are due to fluctuations in fair values resulting from changes in market interest rates and are considered temporary as of December 31, 2023. The Company held one corporate security that was in an unrealized loss position at December 31, 2023. Management believes the unrealized losses were the result of movements in long-term interest rates and are not reflective of any credit deterioration. All municipal securities held in the investment portfolio are reviewed on at least a quarterly basis for credit loss impairment. Each bond carries an investment grade rating by either Moody's or Standard & Poor's. In addition, the Company periodically conducts its own independent review on each issuer to ensure the financial stability of the municipal entity. The largest geographic concentration was in Maryland and consisted of either general obligation or revenue bonds backed by the taxing power of the issuing municipality. At December 31, 2023, the investment portfolio included municipal securities that were in an unrealized loss position. Management believes the unrealized losses were the result of movements in long-term interest rates and are not reflective of any credit deterioration. At December 31, 2023 and 2022, investment securities in the amount of approximately $13.2 million and $0, respectively, were pledged as collateral under the Federal Reserve’s Bank Term Funding Program. Unrealized losses on securities in the investment portfolio amounted to $25.4 million with a total fair value of $136.1 million as of December 31, 2023 compared to unrealized losses of $29.3 million with a total fair value of $142.5 million as of December 31, 2022. The Company believes the unrealized losses presented in the tables above are temporary in nature and primarily related to market interest rates or limited trading activity in a particular type of security rather than the underlying credit quality of the issuers. The Company does not believe that these losses are other than temporary and does not currently intend to sell or believe it will be required to sell securities in an unrealized loss position prior to maturity or recovery of the amortized cost bases. The following table presents investment securities by stated maturity at December 31, 2023. Collateralized mortgage obligations and agency mortgage-backed securities have expected maturities that differ from contractual maturities because borrowers have the right to call or prepay obligations with or without prepayment penalties and, therefore, these securities are classified separately with no specific maturity date. At December 31, 2023 Amortized Fair (dollars in thousands) Cost Value Due within one year $ 20,998 $ 20,814 Due over one to five years 5,080 4,584 Due over five to ten years 14,665 12,621 Due over ten years 56,152 41,633 Collateralized mortgage obligations 15,962 13,661 Agency mortgage-backed securities 51,930 46,114 Total securities available for sale $ 164,787 $ 139,427 No investment securities were sold in 2023 or 2022. |
Loans and Allowance for Credit
Loans and Allowance for Credit Losses - Loans | 12 Months Ended |
Dec. 31, 2023 | |
Loans and Allowance for Credit Losses - Loans | |
Loans and Allowance for Credit Losses - Loans | Note 4. Loans and Allowance for Credit Losses - Loans The following table sets forth the Company's gross loans by major categories as of December 31, 2023 and 2022: December 31, (dollars in thousands) 2023 2022 Loans Secured by Real Estate Construction and land $ 4,636 $ 4,499 Farmland 325 333 Single-family residential 86,887 80,251 Multi-family 5,165 5,304 Commercial 39,217 42,936 Total loans secured by real estate 136,230 133,323 Commercial and Industrial Commercial and industrial 10,850 8,990 SBA guaranty 5,924 6,158 Total commercial and industrial loans 16,774 15,148 Consumer Loans Consumer 2,039 1,521 Automobile 21,264 36,448 Total consumer loans 23,303 37,969 Loans, net of deferred fees and costs 176,307 186,440 Less: Allowance for credit losses (2,157) (2,162) Loans, net $ 174,150 $ 184,278 The Bank’s net loans totaled . Construction and land loans increased from . Farmland loans were million at December 31, 2023 and December 31, 2022. Single-family residential loans increased from . Multi-family residential loans were . Commercial real estate loans decreased million on December 31, 2022. Commercial and industrial loans increased by million on December 31, 2022. SBA guaranty loans were million at December 31, 2022. Consumer loans increased by million on December 31, 2022. Automobile loans decreased from The Company currently manages its credit products and the respective exposure to credit losses by specific portfolio segments and classes, which are levels at which the Company develops and documents its systematic methodology to determine the allowance for credit losses. The Company believes each portfolio segment has unique risk characteristics. The Company's loans held for investment is divided into three portfolio segments: loans secured by real estate, commercial and industrial loans, and consumer loans. Each of these segments is further divided into loan classes for purposes of estimating the allowance for credit losses. The Bank has an automotive indirect lending program where loans, collateralized by vehicles, made by car dealers to consumers are acquired by the Bank. The Bank’s indirect loan group included million of such loans at December 31, 2023 and 2022, respectively. The Bank makes loans to customers located primarily in Anne Arundel County and surrounding areas of Central Maryland. Although the loan portfolio is diversified, its performance will be influenced by the economy of the region. Included in loans are loans due from directors, and other related parties of $0.2 million and $0 , at December 31, 2023 and December, and 2022, respectively. These loans are made on the same terms, including interest rates and collateral, as those prevailing at the time for comparable loans with unrelated borrowers. The Board of Directors approves loans to directors, and other related parties to confirm that collateral requirements, terms and rates are comparable to other borrowers and are in compliance with underwriting policies. The following presents the activity in amount due from directors and other related parties for the years ended December 31, 2023 and 2022. December 31, (dollars in thousands) 2023 2022 Balance at beginning of year $ — $ — Additions 150 1,078 Repayments — (1,078) Balance at end of year $ 150 $ — Allowance for Credit Losses Credit Risk and Allowance for Credit Losses - Loans. Credit risk is the risk of loss arising from the inability of a borrower to meet his or her obligations and entails both general risks, which are inherent in the process of lending, and risks specific to individual borrowers. Credit risk is mitigated through portfolio diversification, which limits exposure to any single customer, industry, or collateral type. Residential mortgage and home equity loans and lines generally have the lowest credit loss experience. Loans secured by personal property, such as auto loans, generally experience medium credit losses. Unsecured loan products, such as personal revolving credit, have the highest credit loss experience and for that reason, the Bank has chosen not to engage in a significant amount of this type of lending. Credit risk in commercial lending can vary significantly, as losses as a percentage of outstanding loans can shift widely during economic cycles and are particularly sensitive to changing economic conditions. Generally, improving economic conditions result in improved operating results on the part of commercial customers, enhancing their ability to meet their particular debt service requirements. Improvements, if any, in operating cash flows can be offset by the impact of rising interest rates that may occur during improved economic times. Inconsistent economic conditions may have an adverse effect on the operating results of commercial customers, reducing their ability to meet debt service obligations. On January 1, 2021, the Company early adopted ASU 2016-13, Financial Instruments - Credit Losses (“ASC 326”) which replaces the “incurred loss approach” for estimating credit losses with an expected loss methodology. The incurred loss model delayed the recognition of credit losses until it was probable that a loss had occurred, while the CECL model requires the immediate recognition of expected credit losses over the contractual term for financial instruments that fall within the scope of CECL at the date of origination or purchase of the financial instrument. The CECL model, which is applicable to the measurement of credit losses on financial assets measured at amortized cost and certain off-balance sheet credit exposures, affects the Company’s estimates of the allowance for credit losses for our loan portfolio and the reserve for our off-balance sheet credit exposures related to loan commitments. The allowance for credit losses - loans is established through a provision for credit losses charged to expense. Loans are charged against the allowance for credit losses - loans when management believes that the collectability of the principal is unlikely. The allowance, based on all available information from internal and external sources, relevant to assessing the collectability of loans over their contractual terms, adjusted for expected prepayments when appropriate, is an amount that management believes will be adequate to absorb possible losses on existing loans that may become uncollectible. The evaluations are performed for each class of loans and take into consideration factors such as changes in the nature and volume of the loan portfolio, overall portfolio quality, review of specific problem loans, value of collateral securing the loans and current economic conditions and trends that may affect the borrowers’ ability to pay. For example, delinquencies in unsecured loans and indirect automobile installment loans will be reserved for at significantly higher ratios than loans secured by real estate. Finally, the Company considers forecasts about future economic conditions or changes in collateral values that are reasonable and supportable. Based on that analysis, the Bank deems its allowance for credit losses - loans in proportion to the total nonaccrual loans and past due loans to be sufficient. The following table presents the total allowance by loan segment: Loans Secured By Real Estate Commercial and Industrial Loans Consumer Loans December 31, 2023 Construction Single-family Commercial Commercial (dollars in thousands) and Land Farmland Residential Multi-family Commercial and Industrial SBA Guaranty SBA PPP Consumer Automobile Total Balance, beginning of year $ 44 $ 20 $ 1,230 $ 103 $ 221 $ 174 $ 22 $ — $ 23 $ 325 $ 2,162 Charge-offs — — — — — — — — (79) (124) (203) Recoveries — — — — — — — — 1 101 102 Release for credit losses (13) (2) 60 (7) (31) 130 (1) — 85 (125) 96 Balance, end of year $ 31 $ 18 $ 1,290 $ 96 $ 190 $ 304 $ 21 $ — $ 30 $ 177 $ 2,157 Individually evaluated for impairment: Balance in allowance $ — $ — $ 21 $ — $ — $ 179 $ — $ — $ — $ — $ 200 Related loan balance — — 30 — — 299 — — — — 329 Collectively evaluated for impairment: Balance in allowance $ 31 $ 18 $ 1,269 $ 96 $ 190 $ 125 $ 21 $ — $ 30 $ 177 $ 1,957 Related loan balance 4,636 325 86,857 5,165 39,217 10,551 5,924 — 2,039 21,264 175,978 Loans Secured By Real Estate Commercial and Industrial Loans Consumer Loans December 31, 2022 Construction Single-family Commercial Commercial (dollars in thousands) and Land Farmland Residential Multi-family Commercial and Industrial SBA Guaranty SBA PPP Consumer Automobile Total Balance, beginning of year $ 5 $ 11 $ 1,357 $ 105 $ 278 $ 115 $ 30 $ — $ 36 $ 533 $ 2,470 Charge-offs — — — — — (200) (9) — (14) (169) (392) Recoveries — — — — — — — — 8 188 196 Release for credit losses 39 9 (127) (2) (57) 259 1 — (7) (227) (112) Balance, end of year $ 44 $ 20 $ 1,230 $ 103 $ 221 $ 174 $ 22 $ — $ 23 $ 325 $ 2,162 Individually evaluated for impairment: Balance in allowance $ — $ — $ 20 $ — $ — $ 59 $ — $ — $ — $ — $ 79 Related loan balance — — 34 — — 300 — — — — 334 Collectively evaluated for impairment: Balance in allowance $ 44 $ 20 $ 1,210 $ 103 $ 221 $ 115 $ 22 $ — $ 23 $ 325 $ 2,083 Related loan balance 4,499 333 80,217 5,304 42,936 8,690 6,158 — 1,521 36,448 186,106 Management believes the allowance for credit losses is at an appropriate level to absorb inherent probable losses in the portfolio. were determined to be uncollectible and were charged off. During the 12 months ended December 31, 2022, loans to The following table provides gross charge-offs for the year 2023 by the year of origination: Gross Charge-offs December 31, 2023 Term Loans by Origination Year Revolving (dollars in thousands) 2023 2022 2021 2020 2019 Prior Loans Total Consumer Loans Consumer $ — $ — $ — $ — $ — $ 79 $ — $ 79 Automobile 47 43 27 7 124 Total gross charge-offs this period $ — $ — $ 47 $ 43 $ 27 $ 86 $ — $ 203 The following table rolls forward the Company’s activity for nonaccrual loans during the years 2023 and 2022: Loans Secured By Real Estate Commercial and Industrial Loans Consumer Loans Single-family Commercial Residential Multi-family Commercial and Industrial SBA Guaranty Consumer Automobile Total (dollars in thousands) December 31, 2021 $ 123 $ — $ — $ — $ 71 $ — $ 144 $ 338 Transfers into nonaccrual 31 — 502 — 11 207 751 Loans paid down/payoffs (50) $ — — (3) $ (61) (11) (105) (230) Loans returned to accrual status — — — — — — (29) (29) Loans charged off — — — (200) (10) — (132) (342) December 31, 2022 $ 104 $ — $ — $ 299 $ — $ — $ 85 $ 488 Transfers into nonaccrual 307 — — — — — 175 482 Loans paid down/payoffs (266) $ — — — $ — — (35) (301) Loans returned to accrual status — — — — — — (19) (19) Loans charged off — — — — (124) (124) December 31, 2023 $ 145 $ — $ — $ 299 $ — $ — $ 83 $ 527 Credit Quality Information In addition to monitoring the performance status of the loan portfolio, the Company utilizes a risk rating scale (1-8) to evaluate loan asset quality for all loans. Loans that are rated 1-4 are classified as “pass” credits. For the pass rated loans, management believes there is a low risk of loss related to these loans and as necessary, credit may be strengthened through improved borrower performance and/or additional collateral. Loans rated a 5 (Special Mention) are pass credits, but are loans that have been identified that warrant additional attention and monitoring and represent “criticized” assets. Loans rated a 6 (Substandard) or higher are considered “criticized” loans and represent an increased level of credit risk. The use and application of these risk ratings by the Bank conform to the Bank's policy and regulatory definitions. The Bank’s internal risk ratings are as follows: 1 – 4 (Pass) - Pass credits are loans in grades “superior” through “acceptable”. These are at least considered to be credits with acceptable risks and would be granted in the normal course of lending operations. 5 (Special Mention) - Special mention credits have potential weaknesses that deserve management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the credits or in the Bank’s credit position at some future date. If weaknesses cannot be identified, classifying as special mention is not appropriate. Special mention credits are not adversely classified and do not expose the Bank to sufficient risk to warrant an adverse classification. No apparent loss of principal or interest is expected. 6 (Substandard) - Substandard credits are inadequately protected by the current worth and paying capacity of the obligor or by the collateral pledged. Financial statements normally reveal some or all of the following: poor trends, lack of earnings and cash flow, excessive debt, lack of liquidity, and the absence of creditor protection. Credits so classified must have a well-defined weakness, or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the Bank will sustain some loss if the deficiencies are not corrected. 7 (Doubtful) - A doubtful credit has all the weaknesses inherent in a substandard asset with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions, and values, highly questionable and improbable. The possibility of loss is extremely high, but because of certain important and reasonably specific pending factors that may work to the advantage and strengthening of the asset, its classification as an estimated loss is deferred until its more exact status may be determined. Pending factors include proposed merger, acquisition, or liquidation procedures, capital injection, perfecting liens on additional collateral, and refinancing plans. Doubtful classification for an entire credit should be avoided when collection of a specific portion appears highly probable with the adequately secured portion graded Substandard. In the normal course of loan portfolio management, loan originators are responsible for continuous assessment of credit risk arising from the individual borrowers within their portfolio and assigning appropriate risk ratings. Credit Administration is responsible for ensuring the integrity and operation of the risk rating system and maintenance of the watch list. The Bank contracts with an independent third-party loan review firm that reviews and validates the internal credit risk program on an annual basis. Results of these reviews are presented to the Audit Committee for approval and then to management for implementation. The loan review process complements and reinforces the risk identification and assessment decisions made by the lenders and credit personnel as well as the Bank’s policies and procedures. The following table provides information with respect to the Company's risk ratings by loan portfolio segment: Loans Secured By Real Estate Commercial and Industrial Loans Consumer Loans December 31, 2023 Construction Single-family Commercial Commercial (dollars in thousands) and Land Farmland Residential Multi-family Commercial and Industrial SBA Guaranty SBA PPP Consumer Automobile Total Pass $ 4,636 $ 325 $ 86,743 $ 5,165 $ 39,217 $ 10,551 $ 5,924 $ — $ 2,039 $ 21,110 $ 175,709 Special mention — — — — — — — — — — — Substandard — — 145 — — 299 — — — 154 598 Doubtful — — — — — — — — — — — Loss — — — — — — — — — — — $ 4,636 $ 325 $ 86,887 $ 5,165 $ 39,217 $ 10,850 $ 5,924 $ — $ 2,039 $ 21,264 $ 176,307 Nonaccrual $ — $ — $ 145 $ — $ — $ 299 $ — $ — $ — $ 83 $ 527 Restructured loans to borrowers with financial difficulty $ — $ — $ 30 $ — $ — $ — $ — $ — $ — $ — $ 30 Number restructured loans to borrowers with financial difficulty — — 1 — — — — — — — 1 Non-performing restructured loans to borrowers with financial difficulty $ — $ — $ 30 $ — $ — $ — $ — $ — $ — $ — $ 30 Number of non-performing restructured loan accounts — — 1 — — — — — — — 1 Loans Secured By Real Estate Commercial and Industrial Loans Consumer Loans December 31, 2022 Construction Single-family Commercial Commercial (dollars in thousands) and Land Farmland Residential Multi-family Commercial and Industrial SBA Guaranty SBA PPP Consumer Automobile Total Pass $ 4,499 $ 333 $ 80,147 $ 5,304 $ 42,936 $ 8,691 $ 6,158 $ — $ 1,521 $ 36,363 $ 185,952 Special mention — — — — — — — — — — — Substandard — — 104 — — 299 — — — 80 483 Doubtful — — — — — — — — — 5 5 Loss — — — — — — — — — — — $ 4,499 $ 333 $ 80,251 $ 5,304 $ 42,936 $ 8,990 $ 6,158 $ — $ 1,521 $ 36,448 $ 186,440 Nonaccrual $ — $ — $ 104 $ — $ — $ 299 $ — $ — $ — $ 85 $ 488 Restructured loans to borrowers with financial difficulty $ — $ — $ 34 $ — $ — $ — $ — $ — $ — $ — $ 34 Number restructured loans to borrowers with financial difficulty — — 1 — — — — — — — 1 Non-performing restructured loans to borrowers with financial difficulty $ — $ — $ 34 $ — $ — $ — $ — $ — $ — $ — $ 34 Number of non-performing restructured loan accounts — — 1 — — — — — — — 1 The following tables provide information about credit quality indicators by the year of origination at December 31, 2023 and 2022: Origination Year December 31, 2023 2023 2022 2021 2020 2019 Prior Total (dollars in thousands) Loans Secured By Real Estate: Pass $ 15,316 $ 12,507 $ 16,675 $ 9,739 $ 9,457 $ 72,391 $ 136,085 Special mention — — — — — — — Substandard — — — — — — — Nonaccrual — — — — — 145 145 Doubtful — — — — — — — Loss — — — — — — — $ 15,316 $ 12,507 $ 16,675 $ 9,739 $ 9,457 $ 72,536 $ 136,230 Commercial and Industrial Loans: Pass $ 3,515 $ 1,099 $ 153 $ 3,834 $ 711 $ 7,163 $ 16,475 Special mention — — — — — — — Substandard — — — — — — — Nonaccrual — — 299 — — — 299 Doubtful — — — — — — — Loss — — — — — — — $ 3,515 $ 1,099 $ 452 $ 3,834 $ 711 $ 7,163 $ 16,774 Consumer Loans: Pass $ 2,140 $ 4,598 $ 5,697 $ 3,364 $ 3,481 $ 3,940 $ 23,220 Special mention — — — — — — — Substandard — — — — — — — Nonaccrual — 27 40 9 — 7 83 Doubtful — — — — — — — Loss — — — — — — — $ 2,140 $ 4,625 $ 5,737 $ 3,373 $ 3,481 $ 3,947 $ 23,303 Origination Year December 31, 2022 2022 2021 2020 2019 2018 Prior Total (dollars in thousands) Loans Secured By Real Estate: Pass $ 11,941 $ 17,685 $ 10,337 $ 9,852 $ 12,670 $ 70,734 $ 133,219 Special mention — — — — — — — Substandard — — — — — — — Nonaccrual — — — — — 104 104 Doubtful — — — — — — — Loss — — — — — — — $ 11,941 $ 17,685 $ 10,337 $ 9,852 $ 12,670 $ 70,838 $ 133,323 Commercial and Industrial Loans: Pass $ 1,468 $ 449 $ 4,056 $ 875 $ 3,581 $ 4,420 $ 14,849 Special mention — — — — — — — Substandard — — — — — — — Nonaccrual — 299 — — — — 299 Doubtful — — — — — — — Loss — — — — — — — $ 1,468 $ 748 $ 4,056 $ 875 $ 3,581 $ 4,420 $ 15,148 Consumer Loans: Pass $ 6,573 $ 8,632 $ 5,187 $ 6,792 $ 8,113 $ 2,587 $ 37,884 Special mention — — — — — — — Substandard — — — — — — — Nonaccrual — 27 13 — 40 5 85 Doubtful — — — — — — — Loss — — — — — — — $ 6,573 $ 8,659 $ 5,200 $ 6,792 $ 8,153 $ 2,592 $ 37,969 Asset Quality The following table presents the loan portfolio segments summarized by aging categories of performing loans and nonaccrual loans as of December 31, 2023 and 2022: 90 Days or 30-89 Days More and December 31, 2023 Current Past Due Still Accruing Nonaccrual Total (dollars in thousands) Loans Secured by Real Estate Construction and land $ 4,636 $ — $ — $ — $ 4,636 Farmland 325 — — — 325 Single-family residential 86,233 509 — 145 86,887 Multi-family 5,165 — — — 5,165 Commercial 39,217 — — — 39,217 Total loans secured by real estate 135,576 509 — 145 136,230 Commercial and Industrial Commercial and industrial 10,551 — — 299 10,850 SBA guaranty 5,924 — — — 5,924 Comm SBA PPP — — — — — Total commercial and industrial loans 16,475 — — 299 16,774 Consumer Loans Consumer 1,981 58 — — 2,039 Automobile 20,794 387 — 83 21,264 Total consumer loans 22,775 445 — 83 23,303 $ 174,826 $ 954 $ — $ 527 $ 176,307 90 Days or 30-89 Days More and December 31, 2022 Current Past Due Still Accruing Nonaccrual Total (dollars in thousands) Loans Secured by Real Estate Construction and land $ 4,499 $ — $ — $ — $ 4,499 Farmland 333 — — — 333 Single-family residential 79,952 185 10 104 80,251 Multi-family 5,304 — — — 5,304 Commercial 42,936 — — — 42,936 Total loans secured by real estate 133,024 185 10 104 133,323 Commercial and Industrial Commercial and industrial 8,691 — — 299 8,990 SBA guaranty 6,158 — — — 6,158 Comm SBA PPP — — — — — Total commercial and industrial loans 14,849 — — 299 15,148 Consumer Loans Consumer 1,521 — — — 1,521 Automobile 36,037 326 — 85 36,448 Total consumer loans 37,558 326 — 85 37,969 $ 185,431 $ 511 $ 10 $ 488 $ 186,440 Loans on which the accrual of interest has been discontinued totaled $0.5 million at December 31, 2023 and 2022. The Bank recognizes interest income on non-accrual loans using a cash basis method for the time they are on non-accrual. Interest income that was recognized on these non-accrual loans totaled $ for the years ended December 31, 2023 and 2022, respectively. Loans past due 90 days or more and still accruing interest totaled $0, and $10,000 at December 31, 2023 and 2022, respectively. Management believes these particular loans are well secured and in the process of full collection of all amounts owed. Nonaccrual loans with specific reserves at December 31, 2023 are comprised of: Consumer Commercial and industrial established for the loan. Impaired Loans The following table presents information with respect to impaired loans. Management determined the specific reserve in the allowance based on the present value of expected future cash flows, discounted at the loan’s effective interest rate, except when the remaining source of repayment for the loan is the operation or liquidation of the collateral. In those cases, the current fair value of the collateral, less estimated selling costs is used to determine the specific allowance recorded. Unpaid Interest Average December 31, 2023 Recorded Principal Income Specific Recorded (dollars in thousands) Investment Balance Recognized Reserve Investment Impaired loans with specific reserves: Loans Secured by Real Estate Construction and land $ — $ — $ — $ — $ — Farmland — — — — — Single-family residential 9 30 4 21 48 Multi-family — — — — — Commercial — — — — — Total loans secured by real estate 9 30 4 21 48 Commercial and Industrial Commercial and industrial 120 299 — 179 499 SBA guaranty — — — — — Total commercial and industrial loans 120 299 — 179 499 Consumer Loans Consumer — — — — — Automobile — — — — — Total consumer loans — — — — — Total impaired loans with specific reserves $ 129 $ 329 $ 4 $ 200 $ 547 Impaired loans with no specific reserve: Loans Secured by Real Estate Construction and land $ — $ — $ — $ n/a $ — Farmland — — — n/a — Single-family residential 115 115 5 n/a 130 Multi-family — — — n/a — Commercial — — — n/a — Total loans secured by real estate 115 115 5 — 130 Commercial and Industrial Commercial and industrial — — — n/a — SBA guaranty — — — n/a — Total commercial and industrial loans — — — — — Consumer Loans Consumer — — — n/a — Automobile 154 154 6 n/a 104 Total consumer loans 154 154 6 n/a 104 Total impaired loans with no specific reserve $ 269 $ 269 $ 11 $ — $ 234 Unpaid Interest Average December 31, 2022 Recorded Principal Income Specific Recorded (dollars in thousands) Investment Balance Recognized Reserve Investment Impaired loans with specific reserves: Loans Secured by Real Estate Construction and land $ — $ — $ — $ — $ — Farmland — — — — — Single-family residential 14 34 2 20 48 Multi-family — — — — — Commercial — — — — — Total loans secured by real estate 14 34 2 20 48 Commercial and Industrial Commercial and industrial 240 299 19 59 499 SBA guaranty — — — — — Total commercial and industrial loans 240 299 19 59 499 Consumer Loans Consumer — — — — — Automobile — — — — — Total consumer loans — — — — — Total impaired loans with specific reserves $ 254 $ 333 $ 21 $ 79 $ 547 Impaired loans with no specific reserve: Loans Secured by Real Estate Construction and land $ — $ — $ — $ n/a $ — Farmland — — — n/a — Single-family residential 70 70 2 n/a 79 Multi-family — — — n/a — Commercial — — — n/a — Total loans secured by real estate 70 70 2 — 79 Commercial and Industrial Commercial and industrial — — — n/a — SBA guaranty — — — n/a — Total commercial and industrial loans — — — — — Consumer Loans Consumer — — — n/a — Automobile 85 85 6 n/a 107 Total consumer loans 85 85 6 n/a 107 Total impaired loans with no specific reserve $ 155 $ 155 $ 8 $ — $ 186 |
Premises and Equipment
Premises and Equipment | 12 Months Ended |
Dec. 31, 2023 | |
Premises and Equipment | |
Premises and Equipment | Note 5. Premises and Equipment A summary of premises and equipment is as follows: Useful December 31, lives 2023 2022 (dollars in thousands) Land $ 685 $ 685 Buildings 30-40 years 6,823 6,781 Equipment and fixtures 8,671 8,515 Construction in progress 25 71 Operating Lease Assets 210 366 16,414 16,418 Accumulated depreciation (13,368) (13,141) $ 3,046 $ 3,277 Depreciation expense totaled $0.3 million for the years ended December 31, 2023 and 2022. Amortization of software totaled Operating lease Right-of-Use (“ROU”) assets and operating lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at commencement date. ROU assets also include any initial direct costs incurred and any lease payments made at or before the lease commencement date, less lease incentives received. The Bank leases its Severna Park and Linthicum branches. Minimum lease obligations under the Severna Park branch are per year through September 2024. Minimum lease obligations under the Linthicum branch are per year through December 2024, adjusted annually on a pre-determined basis. The Bank is also required to pay all maintenance costs under all these leasing arrangements. for the years ended December 31, 2023 and 2022, respectively. The Bank uses its incremental borrowing rate based on the information available at the commencement date in determining the lease liabilities as the Company’s leases generally do not provide an implicit rate. Lease terms may include options to extend or terminate when the Company is reasonably certain that the option will be exercised. Future minimum payments of the Bank’s operating leases as of December 31, 2023 are as follows: Year ending December 31, Amount (dollars in thousands) 2024 $ 193 2025 11 2026 9 2027 6 2028 — Thereafter — Total $ 219 |
Federal Home Loan Bank, Short-
Federal Home Loan Bank, Short- and Long-term Borrowings | 12 Months Ended |
Dec. 31, 2023 | |
Federal Home Loan Bank, Short- and Long-term Borrowings | |
Federal Home Loan Bank, Short- and Long-term Borrowings | Note 6. Federal Home Loan Bank, Short- and Long-term Borrowings The Bank owned 12,171 shares of common stock of the FHLB at December 31, 2023. The Bank is required to maintain an investment of of total advances, adjusted for advances and repayments. The credit available under this facility is determined at million at December 31, 2023. Short- and long-term advances totaled at December 31, 2022. This credit facility is secured by a floating lien on the Bank’s residential mortgage loan portfolio. Average short-term borrowings approximated , respectively. Average long-term borrowings approximated million for 2023 and 2022, respectively. At December 31, 2023 the Bank had available unsecured federal funds lines of credit from two financial institutions for $9.0 million and $8.0 million. Derivatives During the fourth quarter of 2017, the Company entered into interest rate swaps to manage interest rate risk. These derivative contracts involve the receipt of floating rate interest from a counterparty in exchange for the Company making fixed-rate payments over the life of the agreement, without the exchange of the underlying notional value. These instruments are designated as cash flow hedges as the receipt of floating rate interest from the counterparty is used to manage interest rate risk associated with forecasted issuances of short-term FHLB advances. The change in the fair value of this hedging instrument is recorded in accumulated other comprehensive income and is subsequently reclassified into earnings in the period that the hedged transaction affects earnings. For derivative financial instruments accounted for as hedging instruments, we formally designate and document, at inception, the financial instrument as a hedge of a specific underlying exposure, the risk management objective, and the manner in which the effectiveness of the hedge will be assessed. We formally assess both at inception and at each reporting period thereafter, whether the derivative financial instruments used in hedging transactions are effective in offsetting changes in cash flows of the related underlying exposures. Any ineffective portion of the changes in cash flow of the instruments is recognized immediately into earnings. ASC 815-10, Derivatives and Hedging (“ASC 815”) requires companies to recognize all derivative instruments as assets or liabilities at fair value in the consolidated balance sheets. In accordance with ASC 815, we designated our interest rate swaps as cash flow hedges of certain active and forecasted variable rate FHLB advances. Changes in the fair value of the hedging instrument, except any ineffective portion, were recorded in accumulated other comprehensive income (loss) until earnings were impacted by the hedged instrument. No components of our hedging instruments were excluded from the assessment of hedge effectiveness in hedging exposure to variability in cash flows. Classification of the gain or loss in the consolidated statements of income upon release from accumulated other comprehensive income (loss) is the same as that of the underlying exposure. We discontinue the use of hedge accounting prospectively when (1) the derivative instrument is no longer effective in offsetting changes in fair value or cash flows of the underlying hedged item; (2) the derivative instrument expires, is sold, terminated, or exercised; or (3) designating the derivative instrument as a hedge is no longer appropriate. When we discontinue hedge accounting because it is no longer probable that an anticipated transaction will occur in the originally expected period, or within an additional two-month period thereafter, changes to fair value that were recorded in accumulated other comprehensive income (loss) are recognized immediately in earnings. As of December 31, 2023 and 2022, the Company had $0 outstanding interest rate swaps designated as cash flow hedges. A recognized in noninterest income. The cash flow hedges were determined to be fully effective during all periods presented. As such, no ineffectiveness has been included in net income. Total interest expense recorded on these swap transactions in the consolidated statements of income during the year ended December 31, 2023 and December 31, 2022 was $0 and $150,000, respectively. |
Deposits
Deposits | 12 Months Ended |
Dec. 31, 2023 | |
Deposits | |
Deposits | Note 7. Deposits The following table summarizes the major classifications of deposit balances as of the dates indicated: December 31, 2023 2022 (dollars in thousands) Noninterest-bearing deposits $ 116,922 $ 143,262 Interest-bearing deposits: Interest-bearing checking 28,571 40,086 Money Market 26,836 15,791 Savings 93,104 113,101 Time deposits, $100,000 or more 12,501 19,999 Time deposits below $100,000 22,133 30,708 Total interest- bearing deposits 183,145 219,685 Total Deposits $ 300,067 $ 362,947 Interest expense on deposits for the years ended December 31, 2023 and 2022 is as follows: 2023 2022 (dollars in thousands) Interest-bearing checking $ 10 $ 11 Money Market 76 12 Savings 89 59 Time deposits, $100,000 or more 162 183 Time deposits below $100,000 176 206 Total Interest Expense $ 513 $ 471 The Bank recognized $0.2 million of fee income from deposits for the years ended December 31, 2023 and 2022. At December 31, 2023, the scheduled maturities of time deposits are approximately as follows: (dollars in thousands) Amount Maturing in: 2024 $ 22,577 2025 4,587 2026 3,514 2027 1,722 2028 1,995 2027 and thereafter 239 Total Time Deposits $ 34,634 Deposit balances of executive officers and directors and their affiliated interests totaled approximately $2.4 million and $2.1 million at December 31, 2023 and 2022, respectively. The Bank had no brokered deposits at December 31, 2023 and 2022. The aggregate amount of time deposit accounts that equal or exceed the $250,000 insured limit totaled $2.5 million and $5.1 million at December 31, 2023 and 2022, respectively. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2023 | |
Income Taxes | |
Income Taxes | Note 8. Income Taxes The components of income tax expense are as follows for the years ended December 31, 2023 and 2022: 2023 2022 (dollars in thousands) Current income tax expense: Federal $ 128 $ 302 State 28 148 Total current tax expense 156 450 Deferred income tax expense: Federal (59) (147) State (25) (63) Total deferred tax expense (84) (210) Total Income tax expense $ 72 $ 240 A reconciliation of income tax expense computed at the statutory rate of 21% at December 31, 2023 and December 31, 2022 to the actual income tax expense for the years ended December 31, 2023 and 2022 is as follows: 2023 2022 (dollars in thousands) Income tax expense at federal statutory rate $ 315 $ 417 (Decrease) increase resulting from: Tax-exempt income (212) (212) Bank owned life insurance (34) (33) State income taxes, net of Federal income tax benefit 3 68 Total income tax expense $ 72 $ 240 Deferred tax assets and liabilities resulting from the tax effects of temporary differences between the carrying amount of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes at December 31, 2023 and 2022 are as follows: 2023 2022 (dollars in thousands) Deferred income tax benefits: Accrued deferred compensation $ 89 $ 87 Allowance for credit losses 480 386 Accumulated depreciation (12) (18) Accrued Liabilities 110 144 Reserve for unfunded commitments 130 131 Accounting standard 310-20 (151) (145) Right of use asset (58) (101) Lease liability 58 101 Accumulated securities discount accretion 272 248 Net unrealized depreciation on investment securities available for sale 6,979 8,069 Net deferred income tax benefits $ 7,897 $ 8,902 Management has determined that no valuation allowance is required as it believes it is more likely than not that all of the deferred tax assets will be fully realizable in the future. At December 31, 2023 and 2022, management believes there are no uncertain tax positions under ASC Topic 740 Income Taxes. Income tax expense was $0.07 million and $0.24 million at December 2023 and 2022, respectively. |
Pension and Profit Sharing Plan
Pension and Profit Sharing Plans | 12 Months Ended |
Dec. 31, 2023 | |
Pension and Profit Sharing Plans | |
Pension and Profit Sharing Plans | Note 9. Pension and Profit Sharing Plans The Bank has a defined contribution retirement plan qualifying under Section 401(k) of the Internal Revenue Code that is funded through a profit sharing agreement and voluntary employee contributions. Annual contributions, included in employee benefit expense, totaled $479,000 and $277,000 for the years ended December 31, 2023 and 2022, respectively. |
Other Benefit Plans
Other Benefit Plans | 12 Months Ended |
Dec. 31, 2023 | |
Other Benefit Plans | |
Other Benefit Plans | Note 10. Other Benefit Plans The Company is the owner and beneficiary of BOLI policies on certain current and former employees. Cash value totaled million at December 31, 2023 and 2022, respectively. Income on insurance investment totaled million for years ended 2023 and 2022. The Bank has an unfunded grantor trust, as part of a change in control severance plan, covering substantially all employees. Participants in the plan are entitled to cash severance benefits upon termination of employment, for any reason other than just cause, should a “change in control” of the Company occur. |
Other Noninterest Expenses
Other Noninterest Expenses | 12 Months Ended |
Dec. 31, 2023 | |
Other Noninterest Expenses | |
Other Noninterest Expenses | Note 11. Other Noninterest Expenses Other noninterest expenses include the following: Year Ended December 31, 2023 2022 (dollars in thousands) Loan related expenses $ 164 $ 145 Other ATM expenses 34 41 Directors and other fees 277 266 Postage, delivery and courier expenses 83 81 Office supplies expenses 44 38 Credit report fees 21 24 Dues and subscription fees 94 112 Examination and assessment fees 47 51 Federal Reserve and correspondent bank services 28 27 Liability insurance 124 109 (Release) provision for unfunded commitments (4) 107 Card services 111 114 NASDAQ registration 50 61 Investor services 23 41 Other 107 86 Total Other Noninterest Expense $ 1,203 $ 1,303 |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2023 | |
Commitments and Contingencies | |
Commitments and Contingencies | Note 12. Commitments and Contingencies Financial instruments: The Bank is a party to financial instruments in the normal course of business to meet the financing needs of its customers. These financial instruments include commitments to extend credit and standby letters of credit, which involve, to varying degrees, elements of credit and interest rate risk in excess of the amounts recognized in the consolidated financial statements. Outstanding loan commitments, unused lines of credit and letters of credit are as follows: December 31, 2023 2022 (dollars in thousands) Loan commitments: Other mortgage loans $ 8,952 $ 9,280 Unused lines of credit: Home-equity lines $ 10,817 $ 10,142 Commercial lines 12,862 10,717 Unsecured consumer lines 532 579 $ 24,210 $ 21,438 Letters of credit: $ 45 $ 45 Loan commitments and lines of credit are agreements to lend to customers as long as there is no violation of any conditions of the contracts. Loan commitments generally have interest rates fixed at current market amounts, fixed expiration dates, and may require payment of a fee. Lines of credit generally have variable interest rates. Many of the loan commitments and lines of credit are expected to expire without being drawn upon; accordingly, the total commitment amounts do not necessarily represent future cash requirements. The Bank evaluates each customer’s creditworthiness on a case-by-case basis. The amount of collateral or other security obtained, if deemed necessary by the Bank upon extension of credit, is based on management’s credit evaluation. Collateral held varies but may include deposits held in financial institutions, U.S. Treasury securities, other marketable securities, accounts receivable, inventory, property and equipment, personal residences, income-producing commercial properties, and land under development. Personal guarantees are also obtained to provide added security for certain commitments. Letters of credit are conditional commitments issued by the Bank to guarantee the performance of a customer to a third party. Those guarantees are primarily issued to guarantee the installation of real property improvements and similar transactions. The credit risk involved in issuing letters of credit is essentially the same as that involved in extending loan facilities to customers. The Bank holds collateral and obtains personal guarantees supporting those commitments for which collateral or other securities is deemed necessary. The Bank’s exposure to credit loss in the event of nonperformance by the customer is the contractual amount of the commitment. Loan commitments, lines of credit, and letters of credit are made on the same terms, including collateral, as outstanding loans. As of December 31, 2023 and December 31, 2022, the Bank accrued $473,000 and $477,000, respectively, as a reserve for losses on unfunded commitments related to these financial instruments with off balance sheet risk, which is included in other liabilities. |
Stockholders' Equity
Stockholders' Equity | 12 Months Ended |
Dec. 31, 2023 | |
Stockholders' Equity | |
Stockholders' Equity | Note 13. Stockholders’ Equity Restrictions on Dividends The Company’s ability to pay dividends to its stockholders may be affected by both general corporate law considerations and policies of the Federal Reserve applicable to bank holding companies. Banking regulations limit the amount of dividends that may be paid without prior approval of the Bank’s regulatory agencies. Regulatory approval is required to pay dividends that exceed the Bank’s net profits for the current year plus its retained net profits for the preceding two years. Retained earnings from which dividends may not be paid without prior approval totaled approximately $21.2 million at December 31, 2023 and $20.7 million at December 31, 2022 based on the earnings restrictions and minimum capital ratio requirements noted below. The payment of dividends by any financial institution or its holding company is affected by the requirement to maintain adequate capital pursuant to applicable capital adequacy guidelines and regulations, and a financial institution generally is prohibited from paying any dividends if, following payment thereof, the institution would be undercapitalized. Notwithstanding the availability of funds for dividends, however, the Federal Reserve may prohibit the payment of any dividends by the subsidiary banks if the Federal Reserve determines such payment would constitute an unsafe or unsound practice. Employee Stock Purchase Benefit Plans The Company has a stock-based compensation plan, which is described below. There were Employees who have completed one year of service are eligible to participate in the employee stock purchase plan. The number of shares of common stock granted under options will bear a uniform relationship to compensation. The plan allows employees to buy stock under options granted at of the fair market value of the stock on the date of grant. Options are vested when granted and will expire no later than from the grant date or upon termination of employment. At December 31, 2023, shares of common stock reserved for issuance under the plan totaled 25,739. The Board of Directors may suspend or discontinue the plan at its discretion. Dividend Reinvestment and Stock Purchase Plan The Company’s dividend reinvestment and stock purchase plan allows all participating stockholders the opportunity to receive additional shares of common stock in lieu of cash dividends at 95% of the fair market value on the dividend payment date. During 2023 and 2022, shares of common stock purchased under the plan , respectively. At December 31, 2023, shares of common stock reserved for issuance under the plan totaled The Board of Directors may suspend or discontinue the plan at its discretion. Stockholder Purchase Plan The Company’s stockholder purchase plan allows participating stockholders the option to purchase newly issued shares of common stock. The Board of Directors shall determine the number of shares that may be purchased pursuant to options. Options granted will expire no later than from the grant date. Each option will entitle the stockholder to purchase one share of common stock, and will be granted in proportion to stockholder share holdings. At the discretion of the Board of Directors, stockholders may be given the opportunity to purchase unsubscribed shares. There was no activity under this plan since June 23, 2000. At December 31, 2023, shares of common stock reserved for issuance under the plan totaled 183,348. The Board of Directors may suspend or discontinue the plan at its discretion. Under all three plans, options granted, exercised, and expired, shares issued and reserved, and grant prices have been restated for the effects of any stock dividends or stock splits. Regulatory Capital Requirements The Bank’s primary regulator is the Federal Deposit Insurance Corporation (“FDIC”) and is subject to regulation, supervision and regular examination by the Maryland Commissioner of Financial Regulation (the “Commissioner”) and the FDIC. The Company is subject to regulation, examination and supervision by the Federal Reserve Board under the Bank Holding Company Act of 1956, as amended (the “BHCA”), and the regulations of the Federal Reserve Board. On January 1, 2015, the Bank became subject to the new Basel III Capital Rules with full compliance with all of the final rule's requirements phased in over a multi-year schedule, to be fully phased-in by January 1, 2019. However, the new Basel III Capital Rules do not apply to the Company since it is a small bank holding company with less than $1.0 billion in total consolidated assets. In July 2013, the final rules were published establishing a new comprehensive capital framework for U.S. banking organizations. The rules implement the Basel Committee’s December 2010 framework known as “Basel III” for strengthening international capital standards as well as certain provisions of the Dodd-Frank Act. The Basel III Capital Rules substantially revise the risk-based capital requirements applicable to bank holding companies and depository institutions compared to the previous U.S. risk-based capital rules. The Basel III Capital Rules define the components of capital and address other issues affecting the numerator in banking institutions’ regulatory capital ratios. The Basel III Capital Rules also address risk weights and other issues affecting the denominator in banking institutions’ regulatory capital ratios and replace the existing risk-weighting approach with a more risk-sensitive approach. The Basel III Capital Rules also implement the requirements of Section 939A of the Dodd-Frank Act to remove references to credit ratings from the federal banking agencies’ rules. Failure to meet minimum capital requirements can initiate certain mandatory, and possibly additional discretionary actions by regulators that, if undertaken, could have a direct material effect on the Company’s financial statements. The Bank must meet specific capital guidelines that involve quantitative measures of its assets, liabilities, and certain off-balance sheet items as calculated under regulatory accounting principles. The Bank’s capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk weightings, and other factors. The rules include a new common equity Tier 1 capital to risk-weighted assets minimum ratio of 4.5%, raise the minimum ratio of Tier 1 capital to risk-weighted assets from 4.0% to 6.0%, require a minimum ratio of Total Capital to risk-weighted assets of 8.0%, and require a minimum Tier 1 leverage ratio of 4.0% . A new capital conservation buffer is also established above the regulatory minimum capital requirements. This capital conservation buffer began its phase-in period beginning January 1, 2016 at on January 1, 2019. The capital conservation buffer is designed to absorb losses during periods of economic stress and, as detailed above, effectively increases the minimum required risk-weighted capital ratios. Strict eligibility criteria for regulatory capital instruments were also implemented under the final rules. The final rules also revise the definition and calculation of Tier 1 capital, Total Capital, and risk-weighted assets. The Common Equity Tier 1, Tier 1 and Total Capital ratios are calculated by dividing the respective capital amounts by risk-weighted assets. Risk-weighted assets are calculated based on regulatory requirements and include total assets, with certain exclusions, allocated by risk weight category, and certain off-balance-sheet items, among other things. The leverage ratio is calculated by dividing Tier 1 capital by adjusted quarterly average total assets, which exclude goodwill and other intangible assets, among other things. As of December 31, 2023 and 2022, the Bank was well-capitalized under the regulatory framework for prompt corrective action under the new Basel III Capital Rules. Management believes, as of December 31, 2023 and 2022, that the Bank met all capital adequacy requirements to which they were subject. The following table presents actual and required capital ratios as of December 31, 2023 and 2022 for the Bank under the Basel III Capital Rules. The minimum required capital amounts presented include the minimum required capital levels as of December 31, 2023 and December 31, 2022 based on the phase-in provisions of the Basel III Capital Rules. Capital levels required to be considered well capitalized are based upon prompt corrective action regulations, as amended to reflect the changes under the Basel III Capital Rules. The Company and Bank are subject to regulatory capital requirements administered by federal banking agencies. Management has determined that the Company’s risk-based capital ratios are not materiality different than the Bank’s and are not reflected in the table below. To Be Well Capitalized To Be Considered Under Prompt Corrective Actual Adequately Capitalized Action Provisions (dollars in thousands) Amount Ratio Amount Ratio Amount Ratio As of December 31, 2023 Common Equity Tier 1 Capital $ 37,975 17.37 % $ 9,840 4.50 % $ 14,213 6.50 % Total Risk-Based Capital $ 40,237 18.40 % $ 17,493 8.00 % $ 21,867 10.00 % Tier 1 Risk-Based Capital $ 37,975 17.37 % $ 13,120 6.00 % $ 17,493 8.00 % Tier 1 Leverage $ 37,975 10.76 % $ 14,113 4.00 % $ 17,641 5.00 % To Be Well Capitalized To Be Considered Under Prompt Corrective Actual Adequately Capitalized Action Provisions (dollars in thousands) Amount Ratio Amount Ratio Amount Ratio As of December 31, 2022 Common Equity Tier 1 Capital $ 37,963 16.45 % $ 10,383 4.50 % $ 14,998 6.50 % Total Risk-Based Capital $ 39,866 17.28 % $ 18,459 8.00 % $ 23,074 10.00 % Tier 1 Risk-Based Capital $ 37,963 16.45 % $ 13,845 6.00 % $ 18,459 8.00 % Tier 1 Leverage $ 37,963 9.53 % $ 15,938 4.00 % $ 19,922 5.00 % |
Earnings Per Common Share
Earnings Per Common Share | 12 Months Ended |
Dec. 31, 2023 | |
Earnings Per Common Share | |
Earnings Per Common Share | Note 14. Earnings Per Common Share The calculation of net income per common share for the years ended December 31, 2023 and 2022 are as follows: Year Ended December 31, 2023 2022 Basic earnings per share: Net income $ 1,429,094 $ 1,745,182 Weighted average common shares outstanding 2,873,500 2,859,239 Basic net income per share $ 0.50 $ 0.61 Diluted earnings per share calculations were not required for 2023 and 2022 as there were no options outstanding at December 31, 2023 and 2022. |
Fair Values of Financial Instru
Fair Values of Financial Instruments | 12 Months Ended |
Dec. 31, 2023 | |
Fair Values of Financial Instruments | |
Fair Values of Financial Instruments | Note 15. Fair Values of Financial Instruments ASC Topic 825, Disclosure about Fair Value of Financial Instruments , requires the disclosure of the estimated fair values of financial instruments. Quoted market prices, where available, are shown as estimates of fair values. Because no quoted market prices are available for a significant part of the Company’s financial instruments, the fair values of such instruments have been derived based on the amount and timing of future cash flows and estimated discount rates. Present value techniques used in estimating the fair value of the Company’s financial instruments are significantly affected by the assumptions used. Fair values derived from using present value techniques are not substantiated by comparisons to independent markets, and in many cases, could not be realized in immediate settlement of the instruments. ASC Topic 825 excludes certain financial instruments and all nonfinancial instruments from its disclosure requirements. Accordingly, the aggregate fair value amounts presented do not represent the underlying value of the Company. The following table presents the estimated fair value and the related carrying values of the Company’s financial instruments as December 31, 2023 and 2022. Items that are not financial instruments are not included. December 31, 2023 December 31, 2022 (dollars in thousands) Carrying Fair Carrying Fair Amount Value Amount Value Financial assets: Cash and due from banks $ 1,940 $ 1,940 $ 2,035 $ 2,035 Interest-bearing deposits in other financial institutions 12,189 12,189 22,680 22,680 Federal funds sold 1,112 1,112 5,377 5,377 Investment securities available for sale 139,427 139,427 144,133 144,133 Investments in restricted stock 1,217 1,217 221 221 Ground rents 130 130 131 131 Loans, less allowance for credit losses 174,150 161,802 184,278 177,254 Accrued interest receivable 1,192 1,192 1,159 1,159 Cash value of life insurance 8,657 8,657 8,493 8,493 Financial liabilities: Deposits 300,067 252,707 362,947 299,773 Short-term borrowings 30,000 30,000 — — Accrued interest payable 366 366 9 9 Unrecognized financial instruments: Commitments to extend credit 33,162 33,162 30,718 30,718 Standby letters of credit 45 45 45 45 The following table presents the carrying amount, fair value, and placement in the fair value hierarchy of the Company’s financial instruments. (dollars in thousands) Carrying Fair December 31, 2023 Amount Value Level 1 Level 2 Level 3 Financial instruments - Assets Cash and cash equivalents $ 15,241 $ 15,241 $ 15,241 — $ — Loans receivable, net 174,150 161,802 — — 161,802 Cash value of life insurance 8,657 8,657 — 8,657 — Financial instruments - Liabilities Deposits 300,067 252,707 33,118 219,589 — For purposes of the disclosures of estimated fair value, the following assumptions were used. Loans. The estimated fair value for loans is determined by discounting future cash flows using current rates at which similar loans would be made to borrowers with similar credit ratings and for the same remaining maturities. Investment securities . Fair values for investment securities are based on quoted market prices, where applicable. When quoted market prices are not available, fair values are based on quoted market prices of comparable instruments. Deposits . The estimated fair value of deposits with no stated maturity, such as noninterest-bearing demand deposits, savings, NOW accounts and money market accounts, is equal to the amount payable on demand at the reporting date (that is, their carrying amounts). The fair value of certificates of deposit is based on the rates currently offered for deposits of similar maturities. The fair value estimates do not include the benefit that results from the low-cost funding provided by the deposit liabilities compared to the cost of borrowing funds in the market. Borrowings . The estimated fair value approximates carrying value for short-term borrowings. The fair value of long-term fixed rate borrowings is estimated by discounting future cash flows using current interest rates currently offered for similar financial instruments over the same maturities. Other assets and liabilities. The estimated fair values for cash and due from banks, interest-bearing deposits in other financial institutions, Federal funds sold, accrued interest receivable and payable, and short-term borrowings are considered to approximate cost because of their short-term nature. Other assets and liabilities of the Bank that are not defined as financial instruments are not included in the above disclosures, such as property and equipment. In addition, non-financial instruments typically not recognized in the financial statements nevertheless may have value but are not included in the above disclosures. These include, among other items, the estimated earnings power of core deposit accounts, the trained work force, customer goodwill, and similar items. |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2023 | |
Fair Value Measurements | |
Fair Value Measurements | Note 16. Fair Value Measurements The Company follows ASC Topic 820, Fair Value Measurements which provides a framework for measuring and disclosing fair value under generally accepted accounting principles. ASC Topic 820 requires disclosures about the fair value of assets and liabilities recognized in the balance sheet in periods subsequent to initial recognition, whether the measurements are made on a recurring basis or on a nonrecurring basis. ASC Topic 820 defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. ASC Topic 820 also establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The standard describes three levels of inputs that may be used to measure fair value. The Fair Value Hierarchy Level 1 – Valuation is based on quoted prices in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date. Level 1 assets and liabilities generally include debt and equity securities that are traded in an active exchange market. Valuations are obtained from readily available pricing sources for market transactions involving identical assets and liabilities. Level 2 – Valuation is based on inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. The valuation may be based on quoted prices for similar assets and liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the asset or liability. Level 3 – Valuation is based on unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Level 3 assets and liabilities include financial instruments whose value is determined using pricing models, discounted cash flow methodologies, or similar techniques, as well as instruments for which determination of fair value requires significant management judgment or estimation. In determining the appropriate levels, the Company performs a detailed analysis of assets and liabilities that are subject to ASC Topic 820. The Bank’s securities available for sale and interest rate swaps are the only assets or liabilities subject to fair value measurements on a recurring basis. The Bank may also be required, from time to time, to measure certain other financial and non-financial assets and liabilities at fair value on a non-recurring basis in accordance with GAAP. Fair value measurements on a recurring and non-recurring basis at December 31, 2023 and 2022 are as follows: Fair (dollars in thousands) Level 1 Level 2 Level 3 Value December 31, 2023 Recurring: Securities available for sale U.S. Treasury $ 6,945 $ — $ — $ 6,945 State and Municipal — 33,729 — 33,729 Mortgaged-backed 531 96,938 — 97,469 Corporate securities — 1,284 — 1,284 Non-recurring: Impaired loans — — 398 398 $ 7,476 $ 131,951 $ 398 $ 139,825 December 31, 2022 Recurring: Securities available for sale U.S. Treasury State and Municipal — $ 6,783 $ — $ 6,783 Mortgaged-backed — 32,297 — 32,297 Corporate securities — 103,728 — 103,728 Interest rate swap — 1,325 — 1,325 Non-recurring: Impaired loans — — 330 330 $ — $ 144,133 $ 330 $ 144,463 Securities available for sale and interest rate swaps are based on quoted market prices, where available. If quoted market prices are not available, fair values are based on quoted market prices of comparable instruments. Measured on a Non-Recurring Basis: Financial Assets and Liabilities The Bank is predominantly a cash flow lender with real estate serving as collateral on a majority of loans. Loans which are deemed to be impaired and foreclosed real estate assets are primarily valued on a nonrecurring basis at the fair values of the underlying real estate collateral. The Bank determines such fair values from independent appraisals. Based on these appraisals, management has applied a specific valuation allowance allocation of Fair Value Measurements We obtain fair values for our impaired loans through a variety of data points and mostly rely on appraisals from independent appraisers. These appraisals do not include an inside inspection of the property as our loan documents do not require the borrower to allow access to the property. Therefore, the most significant unobservable inputs are the details of the amenities included within the property and the condition of the property. Further, we cannot always accurately assess the amount of time it takes to gain ownership of our collateral through the foreclosure process and the damage, as well as potential looting, of the property further decreasing our value. We typically get independent appraisals of properties within three months from the time we determine there may be a collateral shortfall from an impaired loan. The appraisals are typically updated every 12 months from the independent appraiser and more frequently if we feel material changes in value may have occurred for this specific property. During interim periods, typically at the end of each calendar quarter, we review other data points such as a comparable from other like properties or changes in tax assessment values. Non-Financial Assets and Non-Financial Liabilities Application of ASC Topic 820 to non-financial assets and non-financial liabilities became effective January 1, 2009. The Corporation has no non-financial assets or non-financial liabilities measured at fair value on a recurring basis. Certain non-financial assets and non-financial liabilities typically measured at fair value on a non-recurring basis include foreclosed assets (upon initial recognition or subsequent impairment), non-financial assets and non-financial liabilities measured at fair value in the second step of a goodwill impairment test, and intangible assets and other non-financial long-lived assets measured at fair value for impairment assessment. Foreclosed real estate, which are considered to be non-financial assets, have been valued using a market approach. The values were determined using market prices of similar current real estate assets in the same geographical area, which the Bank considers to be level 2 inputs. |
Revenue Recognition
Revenue Recognition | 12 Months Ended |
Dec. 31, 2023 | |
Revenue Recognition | |
Revenue Recognition | Note 17. Revenue Recognition On January 1, 2018, the Company adopted ASU No. 2014-09 “Revenue from Contracts with Customers” (Topic 606) and all subsequent ASUs that modified Topic 606. The implementation of the new standard did not have a material impact on the measurement or recognition of revenue; as such, a cumulative effect adjustment to opening retained earnings was not deemed necessary. Results for reporting periods beginning after January 1, 2018 are presented under Topic 606, while prior period amounts were not adjusted and continue to be reported in accordance with our historic accounting under Topic 605. Topic 606 does not apply to revenue associated with financial instruments, including revenue from loans and securities. Topic 606 is applicable to noninterest revenue streams such as deposit related fees, interchange fees and merchant income. However, the recognition of these revenue streams did not change significantly upon adoption of Topic 606. Substantially all of the Company’s revenue is generated from contracts with customers. Noninterest revenue streams in-scope of Topic 606 are discussed below. Service Charges on Deposit Accounts. Service charges on deposit accounts consist of account analysis fees (i.e., net fees earned on analyzed business and public checking accounts), monthly service fees, check orders, and other deposit account related fees. The Company’s performance obligation for account analysis fees and monthly service fees is generally satisfied, and the related revenue recognized, over the period in which the service is provided. Check orders and other deposit account related fees are largely transactional based, and therefore, the Company’s performance obligation is satisfied, and related revenue recognized, at a point in time. Payment for service charges on deposit accounts is primarily received immediately or at the end of the month through a direct charge to customers’ accounts. Other Noninterest Income. Other noninterest income consists of: fees, exchange, other service charges, safety deposit box rental fees, and other miscellaneous revenue streams. Fees and other service charges are primarily comprised of debit income, ATM fees, merchant services income, and other service charges. Debit card income is primarily comprised of interchange fees earned whenever the Company’s debit cards are processed through card payment networks. ATM fees are primarily generated when a Company cardholder uses a non-Company ATM or a non-Company cardholder uses a Company ATM. Merchant services income mainly represents fees charged to merchants to process their debit card transactions, in addition to account management fees. Other service charges include revenue from processing wire transfers, bill pay service, cashier’s checks, and other services. The Company’s performance obligation for fees, exchange, and other service charges are largely satisfied, and related revenue recognized, when the services are rendered or upon completion. Payment is typically received immediately or in the following month. Safe deposit box rental fees are charged to the customer on an annual basis and recognized upon receipt of payment. |
Parent Company Financial Inform
Parent Company Financial Information | 12 Months Ended |
Dec. 31, 2023 | |
Parent Company Financial Information | |
Parent Company Financial Information | Note 18. Parent Company Financial Information The Balance Sheets, Statements of Income, and Statements of Cash Flows for Glen Burnie Bancorp (Parent Only) are presented below: ___________________________________________Balance Sheets________________________________________ December 31, 2023 2022 (dollars in thousands) Assets Cash $ 88 $ 77 Investment in The Bank of Glen Burnie 19,227 15,975 Other assets 10 2 Total assets $ 19,325 $ 16,054 Liabilities and Stockholders’ Equity Stockholders’ equity: Common stock 2,883 2,865 Surplus 10,964 10,862 Retained earnings 23,859 23,579 Accumulated other comprehensive loss, net of benefits (18,381) (21,252) Total stockholders’ equity 19,325 16,054 Total liabilities and stockholders’ equity $ 19,325 $ 16,054 __________________________________________Statements of Income___________________________________ Year Ended December 31, 2023 2022 (dollars in thousands) Dividends and distributions from subsidiary $ 1,210 $ 1,210 Other expenses (205) (243) Income before income tax benefit and equity in undistributed net income of subsidiary 1,005 967 Income tax benefit 43 39 Change in undistributed equity of subsidiary 381 739 Net income $ 1,429 $ 1,745 ___________________________________Statements of Cash Flows_______________________________________ Year Ended December 31, 2023 2022 (dollars in thousands) Cash flows from operating activities: Net income $ 1,429 $ 1,745 Adjustments to reconcile net income to net cash provided by operating activities: Increase in other assets (8) — Change in undistributed equity of subsidiary (381) (739) Net cash provided by operating activities 1,040 1,006 Cash flows from financing activities: Proceeds from dividend reinvestment plan 120 115 Dividends paid (1,149) (1,143) Net cash used in financing activities (1,029) (1,028) Increase (decrease) in cash 11 (22) Cash, beginning of year 77 99 Cash, end of year $ 88 $ 77 |
Quarterly Results of Operations
Quarterly Results of Operations (Unaudited) | 12 Months Ended |
Dec. 31, 2023 | |
Quarterly Results of Operations (Unaudited) | |
Quarterly Results of Operations (Unaudited) | Note 19. Quarterly Results of Operations (Unaudited) The following is a summary of consolidated unaudited quarterly results of operations: __________________________________________2023__________________________________ (dollars in thousands, Three months ended except per share amounts) December 31, September 30, June 30, March 31, Interest income $ 3,435 $ 3,350 $ 3,267 $ 3,285 Interest expense 544 398 153 107 Net interest income 2,891 2,952 3,114 3,178 Provision for credit losses 103 (92) 127 (42) Net securities gains — — — — Gain on swap contract termination — — — — Income before income taxes 140 539 301 521 Net income 167 552 275 435 Net income per share (basic and diluted) $ 0.06 $ 0.19 $ 0.10 $ 0.15 __________________________________________2022__________________________________ (dollars in thousands, Three months ended except per share amounts) December 31, September 30, June 30, March 31, Interest income $ 3,458 $ 3,308 $ 3,030 $ 2,916 Interest expense 120 271 228 234 Net interest income 3,338 3,037 2,802 2,682 Provision for credit losses 66 39 (117) (100) Net securities gains — 2 — — Gain on swap contract termination 206 — — — Income before income taxes 994 395 345 251 Net income 830 375 309 231 Net income per share (basic and diluted) $ 0.29 $ 0.13 $ 0.11 $ 0.08 |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2023 | |
Summary of Significant Accounting Policies | |
Basis of presentation | Basis of Presentation The consolidated financial statements include the accounts of Glen Burnie Bancorp, The Bank of Glen Burnie and GBB Properties, Inc., a company engaged in the acquisition and disposition of other real estate. All significant intercompany transactions are eliminated in consolidation and certain reclassifications are made when necessary in order to conform the previous year’s financial statements to the current year’s presentation. In preparing the consolidated financial statements, the Company is required to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the financial statements and revenues and expenses during the reporting periods and related disclosures. These estimates that require application of management's subjective or complex judgments often result in the need to make estimates about the effect of matters that are inherently uncertain and may change in future periods. Management has made significant estimates in several areas, including the Loans and Allowance for Credit Losses Loans and Allowance for Credit Losses Investment Securities Fair Value of Financial Instruments Pension and Profit Sharing Plans Income Taxes ). Certain amounts in the financial statements from prior periods have been reclassified to conform to the current financial statement presentation. The Parent Only financial statements (see Note 18, Parent Company Financial Information |
Investment Securities | Investment Securities We classify investment securities as trading, held to maturity ("HTM"), or available for sale ("AFS") at the date of acquisition. Purchases and sales of securities are generally recorded on a trade-date basis. Investment securities that we might not hold until maturity are classified as AFS and are reported at fair value in the statement of financial condition. Fair value measurement is based upon quoted market prices in active markets, if available. If quoted prices in active markets are not available, fair value is measured using pricing models or other model-based valuation techniques such as the present value of future cash flows, which consider prepayment assumptions and other factors such as credit losses and market liquidity. Unrealized gains and losses are excluded from earnings and reported, net of tax, in other comprehensive income (“OCI”). Purchase premiums and discounts are recognized in interest income using the effective interest method over the life of the securities. Purchase premiums or discounts related to mortgage-backed securities are amortized or accreted using projected prepayment speeds. Gains and losses on the sale of securities are recorded on the trade date and are determined using the specific identification method. Debt securities are classified as HTM if the Company has both the intent and ability to hold those securities to maturity regardless of changes in market conditions, liquidity needs or changes in general economic conditions. These securities are carried at cost adjusted for amortization of purchase premiums and accretion of purchase discounts. Transfers of securities from available for sale to held to maturity are accounted for at fair value as of the date of the transfer. The difference between the fair value and the par value at the date of transfer is considered a premium or discount and is accounted for accordingly. Any unrealized gain or loss at the date of the transfer is reported in OCI, and is amortized over the remaining life of the security as an adjustment of yield in a manner consistent with the amortization of any premium or discount, and will offset or mitigate the effect on interest income of the amortization of the premium or discount for that held to maturity security. Impairment may result from credit deterioration of the issuer or collateral underlying the security. In performing an assessment of recoverability, all relevant information is considered, including the length of time and extent to which fair value has been less than the amortized cost basis, the cause of the price decline, credit performance of the issuer and underlying collateral, and recoveries or further declines in fair value subsequent to the balance sheet date. AFS debt securities are measured at fair value rather than amortized cost. Although ASC 326 replaced the legacy other-than-temporary impairment (“OTTI”) model with a credit loss model, it retained the fundamental nature of the legacy OTTI model. For AFS debt securities in an unrealized loss position, the Company first assesses whether it intends to sell, or it is more likely than not that it will be required to sell, the security before recovery of its amortized cost basis. If either criteria is met, the security’s amortized cost basis is written down to fair value through income. For AFS debt securities where neither of the criteria are met, the Company evaluates whether the decline in fair value has resulted from credit losses or other factors. In making this assessment, management considers the extent to which fair value is less than amortized cost, any changes to the credit rating of the security by a rating agency, and adverse conditions specifically related to the security, among other factors. If this assessment indicates that a credit loss exists, the present value of cash flows expected to be collected from the security is compared to the amortized cost basis of the security. If the present value of cash flows expected to be collected is less than the amortized cost basis, a credit loss exists and an allowance for credit losses is recorded for the credit loss, limited to the amount that the fair value is less than the amortized cost basis. Any remaining discount that has not been recorded through an allowance for credit losses is recognized in other comprehensive income. Under the new guidance, an entity may no longer consider the length of time fair value has been less than amortized cost. Changes in the allowance for credit losses are recorded as a provision for (or release of) credit losses. Losses are charged against the allowance when management believes the collectability of an AFS security is considered below the amortized cost basis of the security. As of December 31, 2023 and 2022, the Company determined that the unrealized loss positions in AFS securities were not the result of credit losses, and therefore, an allowance for credit losses was not recorded. |
Federal Home Loan Bank Stock | Federal Home Loan Bank Stock As a borrower from the Federal Home Loan Bank of Atlanta ("FHLB"), the Bank is required to purchase an amount of FHLB stock based on our outstanding borrowings with the FHLB. This stock is used as collateral to secure the borrowings from the FHLB and is accounted for as a cost-method investment. FHLB stock is an equity interest that does not necessarily have a readily determinable fair value for purposes of the ASC Topic 320, Accounting for Certain Investments in Debt and Equity Securities , because its ownership is restricted and lacks a market. FHLB stock can be sold back only at its par value of |
Loans Held for Investment | Loans Held for Investment Loans held for investment are reported at the principal amount outstanding, net of cumulative charge-offs, interest applied to principal (for loans accounted for using the cost recovery method), unamortized net deferred loan origination fees and costs and unamortized premiums or discounts on purchased loans. Interest on loans is accrued and recognized as interest income at the contractual rate of interest. When a loan is designated as held for investment, the intent is to hold these loans for the foreseeable future or until maturity or pay off. From time to time, the Company will originate loans to facilitate the sale of other real estate owned (OREO). Such loans are accounted for using the installment method and any gain on sale is deferred. The Bank financed Loan Fees and Costs Loan origination fees, commitment fees, direct loan origination costs and purchase premiums and discounts on loans are deferred and recognized as an adjustment of yield, to be amortized to interest income over the contractual term of the loan. Nonaccrual Loans Loans are placed on nonaccrual status when the full and timely collection of principal and interest is doubtful, generally when the loan becomes 90 days or more past due for principal or interest payment or if part of the principal balance has been charged off. When a loan is placed on nonaccrual status all interest previously accrued but not collected is reversed against current period interest income. All payments received on nonaccrual loans are accounted for using the cost recovery method. Under the cost recovery method, all cash collected is applied to first reduce the principal balance. A loan may be returned to accrual status if all delinquent principal and interest payments are brought current and the collectability of the remaining principal and interest payments in accordance with the loan agreement is reasonably assured. Loans that are well-secured and in the process of collection are maintained on accrual status, even if they are 90 days or more past due. Impaired Loans A loan is considered impaired when it is probable that all contractual principal and interest payments due will not be collected in accordance with the terms of the loan agreement. Factors considered by management in determining whether a loan is impaired include payment status, collateral value and the probability of collecting scheduled principal and interest payments when due. The carrying value of impaired loans is based on the present value of the loan’s expected future cash flows or, alternatively, the observable market price of the loan or the fair value of the collateral. Modifications with Borrowers Experiencing Financial Difficulty Management evaluates loan restructurings according to the accounting guidance for loan modifications. We may, for economic or legal reasons, grant a concession to a borrower experiencing financial difficulty that we would not otherwise consider. Management strives to identify borrowers in financial difficulty early and works with them to modify to more affordable terms before their loan reaches nonaccrual status. These modified terms may include rate reductions, principal forgiveness, payment forbearance and other actions intended to minimize the economic loss and to avoid foreclosure or repossession of the collateral. A restructuring that results in only an insignificant delay in payment is not considered a concession. A delay may be considered insignificant if the payments subject to the delay are insignificant relative to the unpaid principal or collateral value and the contractual amount due, or the delay in timing of the restructured payment period is insignificant relative to the frequency of payments, the debt's original contractual maturity or original expected duration. Loan modifications with borrowers experiencing financial difficulty are designated as impaired because interest and principal payments will not be received in accordance with the original contract terms. Loans that are performing and on accrual status as of the date of the modification remain on accrual status. Loans that are nonperforming as of the date of modification generally remain as nonaccrual until the prospect of future payments in accordance with the modified loan agreement is reasonably assured, generally demonstrated when the borrower maintains compliance with the restructured terms for a predetermined period, normally at least six months. Loans with temporary below-market concessions remain designated as a loan to borrower experiencing financial difficulty and impaired regardless of the accrual or performance status until the loan is paid off. However, if the loan has been modified in a subsequent restructure with market terms and the borrower is not currently experiencing financial difficulty, then the loan may be de-designated as being made to a borrower experiencing financial difficulty. |
Allowance for Credit Losses - Loans Receivable | Allowance for Credit Losses – Loans Receivable Effective January 1, 2021, the Company applied ASU 2016-13, Financial Instruments - Credit Losses ("ASC 326"), such that the allowance calculation is based on the CECL methodology. Prior to January 1, 2021, the calculation was based on incurred loss methodology. See Note 4, Loans and Allowance for Credit Losses for details. The Company maintains an allowance for credit losses (“ACL”) for the expected credit losses of the loan portfolio as well as unfunded loan commitments. The amount of ACL is based on ongoing, quarterly assessments by management. The CECL methodology requires an estimate of the credit losses expected over the life of an exposure (or pool of exposures) and replaces the incurred loss methodology’s threshold that delayed the recognition of a credit loss until it was probable a loss event was incurred. The ACL consists of the allowance for credit losses - loans and the reserve for unfunded commitments. The estimate of expected credit losses under the CECL methodology is based on relevant information about past events, current conditions, and reasonable and supportable forecasts that affect the collectability of the reported amounts. Historical loss experience is generally the starting point for estimating expected credit losses. We then consider whether the historical loss experience should be adjusted for asset-specific risk characteristics or current conditions at the reporting date that did not exist over the period that historical experience was based on for each loan type. Finally, we consider forecasts about future economic conditions or changes in collateral values that are reasonable and supportable. Portfolio segment is defined as the level at which the Company develops and documents a systematic methodology to determine its ACL. The Company has designated three loan portfolio segments: loans secured by real estate, commercial and industrial loans, and consumer loans. These loan portfolio segments are further disaggregated into classes, which represent loans of similar type, risk characteristics, and methods for monitoring and assessing credit risk. The loans secured by real estate portfolio segment is disaggregated into five classes: construction and land, farmland, single-family residential, multi-family, and commercial. The commercial and industrial loan portfolio segment is disaggregated into two classes: commercial and industrial, and SBA guaranty. The risk of loss for the commercial and industrial loan portfolio segment is generally most indicated by the credit risk rating assigned to each borrower. Commercial and industrial loan risk ratings are determined by experienced senior credit officers based on specific facts and circumstances and are subject to periodic review by an independent internal team of credit specialists. The consumer loan portfolio segment is disaggregated into two classes: consumer and automobile. The risk of loss for the consumer loan portfolio segment is generally most indicated by delinquency status and general economic factors. Each of the three loan portfolio segments may also be further segmented based on risk characteristics. For most of our loan portfolio classes, the historical loss experience is determined using the Average Charge-Off Method. This method pools loans into groups (“cohorts”) sharing similar risk characteristics and tracks each cohort’s net charge-offs over the lives of the loans. The Average Charge-Off Method uses historical values by period (20-year look-back) to calculate losses and then applies the historical average to future balances over the life of the account. The historical loss rates for each cohort are then averaged to calculate an overall historical loss rate which is applied to the current loan balance to arrive at the quantitative baseline portion of the allowance for credit losses for the respective loan portfolio class. For certain loan portfolio classes, the Company determined there was not sufficient historical loss information to calculate a meaningful historical loss rate using the average charge-off methodology. For any such loan portfolio class, peer group history contributes to the Company’s weighted average loss history. The peer group data is included in the weighted average loss history that is developed for each loan pool. The Company also considers qualitative adjustments to the historical loss rate for each loan portfolio class. The qualitative adjustments for each loan class consider the conditions over the 20-year look-back period from which historical loss experience was based and are split into two components: 1) asset or class specific risk characteristics or current conditions at the reporting date related to portfolio credit quality, remaining payments, volume and nature, credit culture and management, business environment or other management factors; and 2) reasonable and supportable forecast of future economic conditions and collateral values. The Company performs a quarterly asset quality review which includes a review of forecasted gross charge-offs and recoveries, nonperforming assets, criticized loans, risk rating migration, delinquencies, etc. The asset quality review is performed by management and the results are used to consider a qualitative overlay to the quantitative baseline. When management deems it to be appropriate, the Company establishes a specific reserve for individually evaluated loans that do not share similar risk characteristics with the loans included in each respective loan pool. These individually evaluated loans are removed from their respective pools and typically represent collateral dependent loans but may also include other non-performing loans or loan modifications to borrowers experiencing financial difficulty. Impaired Loans The specific credit allocations are based on regular analysis of all loans over a fixed-dollar amount where the internal credit rating is at or below a predetermined classification. When a loan is identified as impaired, impairment is measured based on net realizable value, and the recorded investment balance of the loan. For impaired loans, we recognize impairment if we determine that the net realizable value of the impaired loan is less than the recorded investment of the loan (net of previous charge-offs and deferred loan fees and costs), except when the sole remaining source of collection is the underlying collateral. In these cases, impairment is measured as the difference between the recorded investment balance of the loan and the fair value of the collateral. The fair value of the collateral is adjusted for the estimated cost to sell if repayment or satisfaction of a loan is dependent on the sale (rather than only on the operation) of the collateral. Once the impairment amount is determined, an asset-specific allowance is provided that is equal to the calculated impairment and included in the allowance for credit losses - loans. If the calculated impairment is determined to be permanent or not recoverable, the impairment will be charged off. Factors considered by management in determining if impairment is permanent or not recoverable include whether management judges the loan to be uncollectible, repayment is deemed to be protracted beyond reasonable time frames or the loss becomes evident owing to the borrower’s lack of assets. Estimate of Probable Credit Losses - Loans On January 1, 2021, the Company early adopted ASU 2016-13, Financial Instruments - Credit Losses (“ASC 326”) which replaces the “incurred loss approach” for estimating credit losses with an expected loss methodology. The incurred loss model delayed the recognition of credit losses until it was probable that a loss had occurred, while the CECL model requires the immediate recognition of expected credit losses over the contractual term for financial instruments that fall within the scope of CECL at the date of origination or purchase of the financial instrument. The CECL model, which is applicable to the measurement of credit losses on financial assets measured at amortized cost and certain off-balance sheet credit exposures, affects the Company’s estimates of the allowance for credit losses for our loan portfolio and the reserve for our off-balance sheet credit exposures related to loan commitments. The allowance for credit losses is established through a provision for credit losses charged to expense. Loans are charged against the allowance for credit losses when management believes that the collectability of the principal is unlikely. The allowance, based on all available information from internal and external sources, relevant to assessing the collectability of loans over their contractual terms, adjusted for expected prepayments when appropriate, is an amount that management believes will be adequate to absorb possible losses on existing loans that may become uncollectible. The evaluations are performed for each class of loans and take into consideration factors such as changes in the nature and volume of the loan portfolio, overall portfolio quality, review of specific problem loans, value of collateral securing the loans and current economic conditions and trends that may affect the borrowers’ ability to pay. For example, delinquencies in unsecured loans and indirect automobile installment loans will be reserved for at significantly higher ratios than loans secured by real estate. Finally, the Company considers forecasts about future economic conditions or changes in collateral values that are reasonable and supportable. Based on that analysis, the Bank deems its allowance for credit losses in proportion to the total nonaccrual loans and past due loans to be sufficient. |
Reserve for Unfunded Commitments | Reserve for Unfunded Commitments The Company maintains a separate allowance for losses on unfunded loan commitments, which is included in accrued expenses and other liabilities on the consolidated statements of financial condition. The reserve for unfunded commitments (off-balance sheet financial instruments) is established through a provision for credit losses - unfunded commitments, the changes of which are recorded in noninterest expense. The reserve for unfunded commitments is an amount that management believes will be adequate to absorb probable losses inherent in existing commitments, including unused portions of revolving lines of credit and other loans, standby letters of credit, and unused deposit account overdraft privileges. The reserve for unfunded commitments is based on evaluations of the collectability, and prior loss experience of unfunded commitments. The evaluations take into consideration such factors as changes in the nature and size of the loan portfolio, overall loan portfolio quality, loan concentrations, specific problem loans and related unfunded commitments, and current economic conditions that may affect the borrower’s or depositor’s ability to pay. |
Other Real Estate Owned | Other Real Estate Owned Other real estate owned ("OREO") represents real estate acquired in partial or total satisfaction of debts previously contracted with the Company, generally through the foreclosure of loans. These properties are initially recorded at the net realizable value (fair value of collateral less estimated costs to sell). Upon transfer of a loan to OREO, an appraisal is obtained and any excess of the loan balance over the net realizable value is charged against the allowance for credit losses - loans. Subsequent declines in net realizable value identified from the ongoing analysis of such properties as well as gains and losses realized from the sale of OREO are recognized in current period earnings within noninterest expense as foreclosed property expense. The net realizable value of these assets is reviewed and updated as circumstances warrant. Loans transferred to OREO through foreclosure proceedings totaled for the year ended December 31, 2022, and 2023. |
Premises and Equipment | Premises and Equipment Bank premises and equipment are stated at cost less accumulated depreciation and depreciated over the estimated useful life of the related asset or the term of the lease using the straight-line method. Expenditures for improvements that extend the life of an asset are capitalized and depreciated over the asset’s remaining useful life. Gains or losses realized on the disposition of premises and equipment are reflected in the consolidated statements of income. Expenditures for repairs and maintenance are charged to occupancy and equipment expense as incurred. Computer software is recorded at cost and amortized over three . Management periodically evaluates the carrying value of long-lived assets and certain identifiable intangibles, including goodwill, furniture and equipment and leasehold improvements for impairment. |
Income Taxes | Income Taxes Our income tax expense, and deferred tax assets and liabilities reflect management’s best assessment of estimated current and future taxes to be paid. Significant judgments and estimates are required in determining the consolidated income tax expense. Deferred income taxes arise from temporary differences between the tax basis of assets and liabilities and their reported amounts in the financial statements, which will result in taxable or deductible amounts in the future. Deferred tax assets and liabilities are reflected at currently enacted income tax rates applicable to the period in which the deferred tax assets or liabilities are expected to be realized or settled. As changes in tax laws or rates are enacted, deferred tax assets and liabilities are adjusted through the provision for income taxes and are reflected as discrete tax items in the Company’s tax provision. The Company records net deferred tax assets to the extent it is believed that these assets will more likely than not be realized. In making this determination, the Company considers all available evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax planning strategies, and recent financial operations. A tax position that meets the more likely than not recognition threshold is initially and subsequently measured as the largest amount of tax benefit that has a greater than 50% likelihood of being realized upon settlement with a taxing authority. The Company files a consolidated federal income tax return and separate company state tax returns. For a more detailed description of income taxes see Note 8, Income Taxes |
Interest Rate Swap Agreements | Interest Rate Swap Agreements For asset/liability management purposes, the Company periodically uses interest rate swap agreements to hedge various exposures or to modify interest rate characteristics of various balance sheet accounts. All interest rate swap agreements are recorded at fair value. The Company records cash flow hedges at the inception of the derivative contract based on the Company’s intentions and belief as to its likelihood of effectiveness as a hedge. Cash flow hedges represent a hedge of a forecasted transaction or the variability of cash flows to be received or paid related to a recognized asset or liability. For a cash flow hedge, the gain or loss on the derivative is reported in other comprehensive income and is reclassified into earnings in the same periods during which the hedged transaction affects earnings. The changes in the fair value of derivatives that are not highly effective in hedging the changes in fair value or expected cash flows of the hedged item are recognized immediately in current earnings. Changes in the fair value of derivatives that do not qualify for hedge accounting are reported currently in earnings, as noninterest income. Net cash settlements on derivatives that qualify for hedge accounting are recorded in interest income or interest expense, based on the item being hedged. Net cash settlements on derivatives that do not qualify for hedge accounting are reported in noninterest income. Cash flows on hedges are classified in the cash flow statement the same as the cash flows of the items being hedged. The Company formally documents the relationship between derivatives and hedged items, as well as the risk management objective and the strategy for undertaking hedge transactions at the inception of the hedging relationship. This documentation includes linking cash flow hedges to specific assets and liabilities on the balance sheet or to specific firm commitments or forecasted transactions. The Company also formally assesses, both at the hedge’s inception and on an ongoing basis, whether the derivative instruments that are used are highly effective in offsetting changes in fair values or cash flows of the hedged items. The Company discontinues hedge accounting when it determines that the derivative is no longer effective in offsetting changes in the fair value or cash flows of the hedged item, the derivative is settled or terminates, a hedged forecasted transaction is no longer probable, a hedged firm commitment is no longer firm, or treatment of the derivative as a hedge is no longer appropriate or intended. When hedge accounting is discontinued, subsequent changes in fair value of the derivative are recorded as noninterest income. We recognized a million gain on cancellation of interest rate swap contracts for the year ended December 31, 2022. There were cancellations of interest rate swap contracts during 2023. When a cash flow hedge is discontinued but the hedged cash flows or forecasted transactions are still expected to occur, gains or losses that were accumulated in other comprehensive income are amortized into earnings over the same periods which the hedged transactions will affect earnings. |
Fair Value Measurement | Fair Value Measurement The term "fair value" is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. A fair value measurement assumes that the transaction to sell the asset or transfer the liability occurs in the principal market for the asset or liability or, in the absence of a principal market, the most advantageous market for the asset or liability. The Company’s approach is to maximize the use of observable inputs and minimize the use of unobservable inputs when developing fair value measurements. The degree of management judgment involved in estimating the fair value of a financial instrument or other asset is dependent upon the availability of quoted market prices or observable market value inputs for internal valuation models used for estimating fair value. For financial instruments that are actively traded in the marketplace or whose values are based on readily available market data, little judgment is necessary when estimating the instrument’s fair value. When observable market prices and data are not readily available, significant management judgment often is necessary to estimate fair value. In those cases, different assumptions could result in significant changes in valuation. See Note 16, Fair Value Measurement. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Bank has included cash and due from banks, interest-bearing deposits in other financial institutions, and federal funds sold as cash and cash equivalents for the purpose of reporting cash flows. The carrying value of cash and cash equivalents approximates its fair value due to its short-term nature. |
Earnings Per Share | Earnings Per Share Basic earnings per common share (“EPS”) is computed by dividing net income available to common shareholders by the weighted average common shares outstanding during the period. Diluted EPS is computed by dividing net income available to common shareholders by the weighted average common shares outstanding, plus the effect of common stock equivalents (for example, stock options computed using the treasury stock method). |
Advertising Expense | Advertising Expense Advertising costs, which we consider to be media and marketing materials, are expensed as incurred. We incurred |
Bank Owned Life Insurance | Bank Owned Life Insurance The Company has purchased bank owned life insurance policies on certain current and former employees as a means to generate tax-exempt income which is used to offset a portion of current and future employee benefit costs. Bank owned life insurance is recorded at the cash surrender value of the policies. Changes in the cash surrender value are included in noninterest income. |
Other Comprehensive Income (Loss) | Other Comprehensive Income (Loss) Other comprehensive income includes unrealized gains and losses, net of tax, on AFS securities and derivative instruments. Unrealized gains and losses, 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. |
Recent Accounting Pronouncements and Developments | Recent Accounting Pronouncements and Developments ASU No. 2022-01, “Derivative and Hedging (Topic 815): Fair Value Hedging – Portfolio Layer Method.” The ASU clarifies the guidance in ASC 815 on fair value hedge accounting of interest rate risk for portfolios of financial assets. The ASU amends the guidance in ASU 2017-12 (released on August 28, 2017) that, among other things, established the “last-of-layer” method for making the fair value hedge accounting for these portfolios more accessible. The ASU renames that method the “portfolio layer” method and addresses feedback from stakeholders regarding its application. The objective of the ASU is to better align the Company’s financial reporting with the results of its risk management strategy, and to improve the hedge accounting model by simplifying it. The ASU is effective for the Company for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. The adoption of this guidance did not have a material impact upon the Company’s financial position and results of operations. ASU No. 2022-02, “Financial Instruments – Credit Losses (Topic 326), Troubled Debt Restructurings and Vintage Disclosures.” The ASU eliminates the accounting guidance for troubled debt restructurings ("TDRs") in ASC 310-40, "Receivables - Troubled Debt Restructurings by Creditors" for entities that have adopted the current expected credit loss ("CECL") model introduced by ASU 2016-13, “Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments”. It also requires that public business entities disclose current-period gross charge-offs by year of origination for financing receivables and net investments in leases within the scope of Subtopic 326-20, "Financial Instruments—Credit Losses—Measured at Amortized Cost". The ASU is effective for the Company for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years, with early adoption permitted. The adoption of this guidance did not have a material impact upon the Company’s financial position and results of operations. ASU No. 2023-01. Leases (Topic 842), “Common Control Arrangements.” The ASU is an amendment to Topic 842. The amendments in this Update clarify the accounting for leasehold improvements associated with common control leases. This Update has been issued in order to address current diversity in practice associated with the accounting for leasehold improvements associated with a lease between entities under common control. The amendments in this Update apply to all lessees that are a party to a lease between entities under common control in which there are leasehold improvements. The amendments in this Update are effective for interim and annual periods beginning after December 15, 2023. The Company currently has no leases which are subject to this guidance and therefore the impact of adopting the new guidance is not expected to have a material impact upon the Company’s financial position and results of operations. ASU No. 2023-02. Investments-Equity Method and Joint Ventures (Topic 323), “Accounting for Investments in Tax Credit Structures Using the Proportional Amortization Method.” The amendments in this Update permit reporting entities to elect to account for their tax equity investments, regardless of the tax credit program from which the income tax credits are received, using the proportional amortization method if certain conditions are met. The amendments in this Update are effective for interim and annual periods beginning after December 15, 2023 with early adoption permitted. The Company currently has no investments which are subject to this guidance and therefore the impact of adopting the new guidance is not expected to have a material impact upon the Company’s financial position and results of operations. ASU No. 2023-05. Business Combinations – “Joint Venture Formations (Subtopic 805-60): Recognition and Initial Measurement.” The amendments in this Update are effective prospectively for all joint venture formations with a formation date on or after January 1, 2025. Additionally, a joint venture that was formed before January 1, 2025 may elect to apply the amendments retrospectively if it has sufficient information. Early adoption is permitted in any interim or annual period in which financial statements have not yet been issued (or made available for issuance), either prospectively or retrospectively. The Company is evaluating the impact of adopting the new guidance on the consolidated financial statements. ASU No. 2023-06. Disclosure Improvements – “Codification Amendments in Response to the SEC’s Disclosure Update and Simplification Initiative.” The amendments in this Update represent changes to clarify or improve disclosure and presentation requirements of a variety of Topics. Many of the amendments allow users to more easily compare entities subject to the SEC’s existing disclosures with those entities that were not previously subject to the SEC’s requirements. Also, the amendments align the requirements in the Codification with the SEC’s regulations. The effective date for each amendment will be the date on which the SEC’s removal of that related disclosure from Regulation S-X or Regulation S-K becomes effective, with early adoption prohibited. The amendments in this Update should be applied prospectively. If by June 30, 2027, the SEC has not removed the applicable requirement from Regulation S-X or Regulation S-K, the pending content of the related amendment will be removed from the Codification and will not become effective for any entity. ASU No. 2023-07. “Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures (“ASU 2023-04”). This update requires public entities with reportable segments to provide additional and more detailed disclosures. This standard is effective for annual periods beginning after December 15, 2023. The Company is not currently required to report segment information and, as such, does not expect the adoption to have an impact on its consolidated financial statements. ASU No. 2023-08. “Intangibles – Goodwill and Other – Crypto Assets (Subtopic 350-60): Accounting for and disclosure of Crypto Assets (“ASU 2023-08”).” This update provides guidance for crypto assets to be carried at fair value and requires additional disclosures. This standard is effective for all entities for fiscal years beginning after December 15, 2024, including interim periods within those fiscal years. Early adoption is permitted. The Company does not expect the adoption of ASU 2023-08 to have an impact on its consolidated financial statements. The Company currently does not hold crypto assets or carry goodwill on its balance sheet. ASU No. 2023-09. “Income Taxes (Topic 740): Improvements to Income Tax Disclosures.” This update requires more detailed disclosures of income taxes paid net of refunds received, income from continuing operations before income tax expense or benefit, and income tax expense from continuing operations. This standard is to be applied on a prospective basis, with retrospective application permitted, and will be effective for the Company for annual periods beginning after December 15, 2024. We do not expect adoption of this standard to have a material impact on the Company’s financial position or results of operations. |
Investment Securities (Tables)
Investment Securities (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Investment Securities | |
Schedule of summary of investment securities | At December 31, 2023 Gross Gross Amortized Unrealized Unrealized Fair (dollars in thousands) Cost Gains Losses Value Collateralized mortgage obligations $ 15,962 $ 8 $ (2,309) $ 13,661 Agency mortgage-backed securities 51,930 — (5,816) 46,114 Municipal securities 42,990 4 (9,265) 33,729 U.S. Government agency securities 45,406 — (7,712) 37,694 Corporate securities 1,500 — (216) 1,284 U.S. Treasury securities 6,999 — (54) 6,945 Total securities available for sale $ 164,787 $ 12 $ (25,372) $ 139,427 At December 31, 2022 Gross Gross Amortized Unrealized Unrealized Fair (dollars in thousands) Cost Gains Losses Value Collateralized mortgage obligations $ 17,596 $ 7 $ (2,348) $ 15,255 Agency mortgage-backed securities 58,801 — (6,908) 51,893 Municipal securities 43,092 1 (10,796) 32,297 U.S. Government agency securities 45,471 — (8,891) 36,580 Corporate securities 1,500 — (175) 1,325 U.S. Treasury securities 6,993 — (210) 6,783 Total securities available for sale $ 173,453 $ 8 $ (29,328) $ 144,133 |
Schedule of gross unrealized losses and fair value, aggregated by investment category and length of time in continuous unrealized loss position | At December 31, 2023 Less than 12 months 12 months or more Total Fair Unrealized Fair Unrealized Fair Unrealized (dollars in thousands) Value Loss Value Loss Value Loss Collateralized mortgage obligations $ 492 $ (1) $ 11,927 $ (2,308) $ 12,419 $ (2,309) Agency mortgage-backed securities 5 — 46,109 (5,816) 46,114 (5,816) Municipal securities 2,978 (39) 28,667 (9,226) 31,645 (9,265) U.S. Government agency securities 220 (1) 37,474 (7,711) 37,694 (7,712) Corporate securities — — 1,284 (216) 1,284 (216) U.S. Treasury securities — — 6,944 (54) 6,944 (54) $ 3,695 $ (41) $ 132,405 $ (25,331) $ 136,100 $ (25,372) At December 31, 2022 Less than 12 months 12 months or more Total Fair Unrealized Fair Unrealized Fair Unrealized (dollars in thousands) Value Loss Value Loss Value Loss Collateralized mortgage obligations $ 8,315 $ (364) $ 6,127 $ (1,984) $ 14,442 $ (2,348) Agency mortgage-backed securities 20,029 (1,308) 31,865 (5,600) 51,894 (6,908) Municipal securities 18,456 (5,438) 13,340 (5,358) 31,796 (10,796) U.S. Government agency securities 13,526 (474) 22,767 (8,417) 36,293 (8,891) Corporate securities — — 1,325 (175) 1,325 (175) U.S. Treasury securities 6,783 (210) — — 6,783 (210) $ 67,109 $ (7,794) $ 75,424 $ (21,534) $ 142,533 $ (29,328) |
Schedule of contractual maturities of investment securities | At December 31, 2023 Amortized Fair (dollars in thousands) Cost Value Due within one year $ 20,998 $ 20,814 Due over one to five years 5,080 4,584 Due over five to ten years 14,665 12,621 Due over ten years 56,152 41,633 Collateralized mortgage obligations 15,962 13,661 Agency mortgage-backed securities 51,930 46,114 Total securities available for sale $ 164,787 $ 139,427 |
Loans and Allowance for Credi_2
Loans and Allowance for Credit Losses - Loans (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Loans and Allowance for Credit Losses - Loans | |
Schedule of major categories of loans | December 31, (dollars in thousands) 2023 2022 Loans Secured by Real Estate Construction and land $ 4,636 $ 4,499 Farmland 325 333 Single-family residential 86,887 80,251 Multi-family 5,165 5,304 Commercial 39,217 42,936 Total loans secured by real estate 136,230 133,323 Commercial and Industrial Commercial and industrial 10,850 8,990 SBA guaranty 5,924 6,158 Total commercial and industrial loans 16,774 15,148 Consumer Loans Consumer 2,039 1,521 Automobile 21,264 36,448 Total consumer loans 23,303 37,969 Loans, net of deferred fees and costs 176,307 186,440 Less: Allowance for credit losses (2,157) (2,162) Loans, net $ 174,150 $ 184,278 |
Schedule of activity due from directors and other related parties | December 31, (dollars in thousands) 2023 2022 Balance at beginning of year $ — $ — Additions 150 1,078 Repayments — (1,078) Balance at end of year $ 150 $ — |
Schedule of total allowance by loan segment | Loans Secured By Real Estate Commercial and Industrial Loans Consumer Loans December 31, 2023 Construction Single-family Commercial Commercial (dollars in thousands) and Land Farmland Residential Multi-family Commercial and Industrial SBA Guaranty SBA PPP Consumer Automobile Total Balance, beginning of year $ 44 $ 20 $ 1,230 $ 103 $ 221 $ 174 $ 22 $ — $ 23 $ 325 $ 2,162 Charge-offs — — — — — — — — (79) (124) (203) Recoveries — — — — — — — — 1 101 102 Release for credit losses (13) (2) 60 (7) (31) 130 (1) — 85 (125) 96 Balance, end of year $ 31 $ 18 $ 1,290 $ 96 $ 190 $ 304 $ 21 $ — $ 30 $ 177 $ 2,157 Individually evaluated for impairment: Balance in allowance $ — $ — $ 21 $ — $ — $ 179 $ — $ — $ — $ — $ 200 Related loan balance — — 30 — — 299 — — — — 329 Collectively evaluated for impairment: Balance in allowance $ 31 $ 18 $ 1,269 $ 96 $ 190 $ 125 $ 21 $ — $ 30 $ 177 $ 1,957 Related loan balance 4,636 325 86,857 5,165 39,217 10,551 5,924 — 2,039 21,264 175,978 Loans Secured By Real Estate Commercial and Industrial Loans Consumer Loans December 31, 2022 Construction Single-family Commercial Commercial (dollars in thousands) and Land Farmland Residential Multi-family Commercial and Industrial SBA Guaranty SBA PPP Consumer Automobile Total Balance, beginning of year $ 5 $ 11 $ 1,357 $ 105 $ 278 $ 115 $ 30 $ — $ 36 $ 533 $ 2,470 Charge-offs — — — — — (200) (9) — (14) (169) (392) Recoveries — — — — — — — — 8 188 196 Release for credit losses 39 9 (127) (2) (57) 259 1 — (7) (227) (112) Balance, end of year $ 44 $ 20 $ 1,230 $ 103 $ 221 $ 174 $ 22 $ — $ 23 $ 325 $ 2,162 Individually evaluated for impairment: Balance in allowance $ — $ — $ 20 $ — $ — $ 59 $ — $ — $ — $ — $ 79 Related loan balance — — 34 — — 300 — — — — 334 Collectively evaluated for impairment: Balance in allowance $ 44 $ 20 $ 1,210 $ 103 $ 221 $ 115 $ 22 $ — $ 23 $ 325 $ 2,083 Related loan balance 4,499 333 80,217 5,304 42,936 8,690 6,158 — 1,521 36,448 186,106 |
Schedule of current period gross charge-offs by the year of origination | Gross Charge-offs December 31, 2023 Term Loans by Origination Year Revolving (dollars in thousands) 2023 2022 2021 2020 2019 Prior Loans Total Consumer Loans Consumer $ — $ — $ — $ — $ — $ 79 $ — $ 79 Automobile 47 43 27 7 124 Total gross charge-offs this period $ — $ — $ 47 $ 43 $ 27 $ 86 $ — $ 203 |
Schedule of non accrual loans | The following table rolls forward the Company’s activity for nonaccrual loans during the years 2023 and 2022: Loans Secured By Real Estate Commercial and Industrial Loans Consumer Loans Single-family Commercial Residential Multi-family Commercial and Industrial SBA Guaranty Consumer Automobile Total (dollars in thousands) December 31, 2021 $ 123 $ — $ — $ — $ 71 $ — $ 144 $ 338 Transfers into nonaccrual 31 — 502 — 11 207 751 Loans paid down/payoffs (50) $ — — (3) $ (61) (11) (105) (230) Loans returned to accrual status — — — — — — (29) (29) Loans charged off — — — (200) (10) — (132) (342) December 31, 2022 $ 104 $ — $ — $ 299 $ — $ — $ 85 $ 488 Transfers into nonaccrual 307 — — — — — 175 482 Loans paid down/payoffs (266) $ — — — $ — — (35) (301) Loans returned to accrual status — — — — — — (19) (19) Loans charged off — — — — (124) (124) December 31, 2023 $ 145 $ — $ — $ 299 $ — $ — $ 83 $ 527 |
Schedule of risk ratings of loans by categories of loans | Loans Secured By Real Estate Commercial and Industrial Loans Consumer Loans December 31, 2023 Construction Single-family Commercial Commercial (dollars in thousands) and Land Farmland Residential Multi-family Commercial and Industrial SBA Guaranty SBA PPP Consumer Automobile Total Pass $ 4,636 $ 325 $ 86,743 $ 5,165 $ 39,217 $ 10,551 $ 5,924 $ — $ 2,039 $ 21,110 $ 175,709 Special mention — — — — — — — — — — — Substandard — — 145 — — 299 — — — 154 598 Doubtful — — — — — — — — — — — Loss — — — — — — — — — — — $ 4,636 $ 325 $ 86,887 $ 5,165 $ 39,217 $ 10,850 $ 5,924 $ — $ 2,039 $ 21,264 $ 176,307 Nonaccrual $ — $ — $ 145 $ — $ — $ 299 $ — $ — $ — $ 83 $ 527 Restructured loans to borrowers with financial difficulty $ — $ — $ 30 $ — $ — $ — $ — $ — $ — $ — $ 30 Number restructured loans to borrowers with financial difficulty — — 1 — — — — — — — 1 Non-performing restructured loans to borrowers with financial difficulty $ — $ — $ 30 $ — $ — $ — $ — $ — $ — $ — $ 30 Number of non-performing restructured loan accounts — — 1 — — — — — — — 1 Loans Secured By Real Estate Commercial and Industrial Loans Consumer Loans December 31, 2022 Construction Single-family Commercial Commercial (dollars in thousands) and Land Farmland Residential Multi-family Commercial and Industrial SBA Guaranty SBA PPP Consumer Automobile Total Pass $ 4,499 $ 333 $ 80,147 $ 5,304 $ 42,936 $ 8,691 $ 6,158 $ — $ 1,521 $ 36,363 $ 185,952 Special mention — — — — — — — — — — — Substandard — — 104 — — 299 — — — 80 483 Doubtful — — — — — — — — — 5 5 Loss — — — — — — — — — — — $ 4,499 $ 333 $ 80,251 $ 5,304 $ 42,936 $ 8,990 $ 6,158 $ — $ 1,521 $ 36,448 $ 186,440 Nonaccrual $ — $ — $ 104 $ — $ — $ 299 $ — $ — $ — $ 85 $ 488 Restructured loans to borrowers with financial difficulty $ — $ — $ 34 $ — $ — $ — $ — $ — $ — $ — $ 34 Number restructured loans to borrowers with financial difficulty — — 1 — — — — — — — 1 Non-performing restructured loans to borrowers with financial difficulty $ — $ — $ 34 $ — $ — $ — $ — $ — $ — $ — $ 34 Number of non-performing restructured loan accounts — — 1 — — — — — — — 1 |
Schedule of information about credit quality indicators | The following tables provide information about credit quality indicators by the year of origination at December 31, 2023 and 2022: Origination Year December 31, 2023 2023 2022 2021 2020 2019 Prior Total (dollars in thousands) Loans Secured By Real Estate: Pass $ 15,316 $ 12,507 $ 16,675 $ 9,739 $ 9,457 $ 72,391 $ 136,085 Special mention — — — — — — — Substandard — — — — — — — Nonaccrual — — — — — 145 145 Doubtful — — — — — — — Loss — — — — — — — $ 15,316 $ 12,507 $ 16,675 $ 9,739 $ 9,457 $ 72,536 $ 136,230 Commercial and Industrial Loans: Pass $ 3,515 $ 1,099 $ 153 $ 3,834 $ 711 $ 7,163 $ 16,475 Special mention — — — — — — — Substandard — — — — — — — Nonaccrual — — 299 — — — 299 Doubtful — — — — — — — Loss — — — — — — — $ 3,515 $ 1,099 $ 452 $ 3,834 $ 711 $ 7,163 $ 16,774 Consumer Loans: Pass $ 2,140 $ 4,598 $ 5,697 $ 3,364 $ 3,481 $ 3,940 $ 23,220 Special mention — — — — — — — Substandard — — — — — — — Nonaccrual — 27 40 9 — 7 83 Doubtful — — — — — — — Loss — — — — — — — $ 2,140 $ 4,625 $ 5,737 $ 3,373 $ 3,481 $ 3,947 $ 23,303 Origination Year December 31, 2022 2022 2021 2020 2019 2018 Prior Total (dollars in thousands) Loans Secured By Real Estate: Pass $ 11,941 $ 17,685 $ 10,337 $ 9,852 $ 12,670 $ 70,734 $ 133,219 Special mention — — — — — — — Substandard — — — — — — — Nonaccrual — — — — — 104 104 Doubtful — — — — — — — Loss — — — — — — — $ 11,941 $ 17,685 $ 10,337 $ 9,852 $ 12,670 $ 70,838 $ 133,323 Commercial and Industrial Loans: Pass $ 1,468 $ 449 $ 4,056 $ 875 $ 3,581 $ 4,420 $ 14,849 Special mention — — — — — — — Substandard — — — — — — — Nonaccrual — 299 — — — — 299 Doubtful — — — — — — — Loss — — — — — — — $ 1,468 $ 748 $ 4,056 $ 875 $ 3,581 $ 4,420 $ 15,148 Consumer Loans: Pass $ 6,573 $ 8,632 $ 5,187 $ 6,792 $ 8,113 $ 2,587 $ 37,884 Special mention — — — — — — — Substandard — — — — — — — Nonaccrual — 27 13 — 40 5 85 Doubtful — — — — — — — Loss — — — — — — — $ 6,573 $ 8,659 $ 5,200 $ 6,792 $ 8,153 $ 2,592 $ 37,969 |
Schedule of current, past due, and non-accrual loans by categories of loans and restructured loans | 90 Days or 30-89 Days More and December 31, 2023 Current Past Due Still Accruing Nonaccrual Total (dollars in thousands) Loans Secured by Real Estate Construction and land $ 4,636 $ — $ — $ — $ 4,636 Farmland 325 — — — 325 Single-family residential 86,233 509 — 145 86,887 Multi-family 5,165 — — — 5,165 Commercial 39,217 — — — 39,217 Total loans secured by real estate 135,576 509 — 145 136,230 Commercial and Industrial Commercial and industrial 10,551 — — 299 10,850 SBA guaranty 5,924 — — — 5,924 Comm SBA PPP — — — — — Total commercial and industrial loans 16,475 — — 299 16,774 Consumer Loans Consumer 1,981 58 — — 2,039 Automobile 20,794 387 — 83 21,264 Total consumer loans 22,775 445 — 83 23,303 $ 174,826 $ 954 $ — $ 527 $ 176,307 90 Days or 30-89 Days More and December 31, 2022 Current Past Due Still Accruing Nonaccrual Total (dollars in thousands) Loans Secured by Real Estate Construction and land $ 4,499 $ — $ — $ — $ 4,499 Farmland 333 — — — 333 Single-family residential 79,952 185 10 104 80,251 Multi-family 5,304 — — — 5,304 Commercial 42,936 — — — 42,936 Total loans secured by real estate 133,024 185 10 104 133,323 Commercial and Industrial Commercial and industrial 8,691 — — 299 8,990 SBA guaranty 6,158 — — — 6,158 Comm SBA PPP — — — — — Total commercial and industrial loans 14,849 — — 299 15,148 Consumer Loans Consumer 1,521 — — — 1,521 Automobile 36,037 326 — 85 36,448 Total consumer loans 37,558 326 — 85 37,969 $ 185,431 $ 511 $ 10 $ 488 $ 186,440 |
Premises and Equipment (Tables)
Premises and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Premises and Equipment | |
Schedule of summary of premises and equipment | Useful December 31, lives 2023 2022 (dollars in thousands) Land $ 685 $ 685 Buildings 30-40 years 6,823 6,781 Equipment and fixtures 8,671 8,515 Construction in progress 25 71 Operating Lease Assets 210 366 16,414 16,418 Accumulated depreciation (13,368) (13,141) $ 3,046 $ 3,277 |
Schedule of future minimum payments of banks operating leases | Future minimum payments of the Bank’s operating leases as of December 31, 2023 are as follows: Year ending December 31, Amount (dollars in thousands) 2024 $ 193 2025 11 2026 9 2027 6 2028 — Thereafter — Total $ 219 |
Deposits (Tables)
Deposits (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Deposits | |
Schedule of major classifications of interest-bearing deposits | December 31, 2023 2022 (dollars in thousands) Noninterest-bearing deposits $ 116,922 $ 143,262 Interest-bearing deposits: Interest-bearing checking 28,571 40,086 Money Market 26,836 15,791 Savings 93,104 113,101 Time deposits, $100,000 or more 12,501 19,999 Time deposits below $100,000 22,133 30,708 Total interest- bearing deposits 183,145 219,685 Total Deposits $ 300,067 $ 362,947 |
Schedule of interest expense on deposit | 2023 2022 (dollars in thousands) Interest-bearing checking $ 10 $ 11 Money Market 76 12 Savings 89 59 Time deposits, $100,000 or more 162 183 Time deposits below $100,000 176 206 Total Interest Expense $ 513 $ 471 |
Schedule of scheduled maturities of time deposits | (dollars in thousands) Amount Maturing in: 2024 $ 22,577 2025 4,587 2026 3,514 2027 1,722 2028 1,995 2027 and thereafter 239 Total Time Deposits $ 34,634 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Income Taxes | |
Schedule of components of income tax expense | 2023 2022 (dollars in thousands) Current income tax expense: Federal $ 128 $ 302 State 28 148 Total current tax expense 156 450 Deferred income tax expense: Federal (59) (147) State (25) (63) Total deferred tax expense (84) (210) Total Income tax expense $ 72 $ 240 |
Schedule of reconciliation of income tax expense | 2023 2022 (dollars in thousands) Income tax expense at federal statutory rate $ 315 $ 417 (Decrease) increase resulting from: Tax-exempt income (212) (212) Bank owned life insurance (34) (33) State income taxes, net of Federal income tax benefit 3 68 Total income tax expense $ 72 $ 240 |
Schedule of components of the net deferred income tax benefits | 2023 2022 (dollars in thousands) Deferred income tax benefits: Accrued deferred compensation $ 89 $ 87 Allowance for credit losses 480 386 Accumulated depreciation (12) (18) Accrued Liabilities 110 144 Reserve for unfunded commitments 130 131 Accounting standard 310-20 (151) (145) Right of use asset (58) (101) Lease liability 58 101 Accumulated securities discount accretion 272 248 Net unrealized depreciation on investment securities available for sale 6,979 8,069 Net deferred income tax benefits $ 7,897 $ 8,902 |
Other Noninterest Expenses (Tab
Other Noninterest Expenses (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Other Noninterest Expenses | |
Schedule of other operating expenses | Year Ended December 31, 2023 2022 (dollars in thousands) Loan related expenses $ 164 $ 145 Other ATM expenses 34 41 Directors and other fees 277 266 Postage, delivery and courier expenses 83 81 Office supplies expenses 44 38 Credit report fees 21 24 Dues and subscription fees 94 112 Examination and assessment fees 47 51 Federal Reserve and correspondent bank services 28 27 Liability insurance 124 109 (Release) provision for unfunded commitments (4) 107 Card services 111 114 NASDAQ registration 50 61 Investor services 23 41 Other 107 86 Total Other Noninterest Expense $ 1,203 $ 1,303 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Commitments and Contingencies | |
Schedule of outstanding loan commitments, unused lines of credit and letters of credit | Outstanding loan commitments, unused lines of credit and letters of credit are as follows: December 31, 2023 2022 (dollars in thousands) Loan commitments: Other mortgage loans $ 8,952 $ 9,280 Unused lines of credit: Home-equity lines $ 10,817 $ 10,142 Commercial lines 12,862 10,717 Unsecured consumer lines 532 579 $ 24,210 $ 21,438 Letters of credit: $ 45 $ 45 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Stockholders' Equity | |
Schedule of comparison of capital with minimum requirements | To Be Well Capitalized To Be Considered Under Prompt Corrective Actual Adequately Capitalized Action Provisions (dollars in thousands) Amount Ratio Amount Ratio Amount Ratio As of December 31, 2023 Common Equity Tier 1 Capital $ 37,975 17.37 % $ 9,840 4.50 % $ 14,213 6.50 % Total Risk-Based Capital $ 40,237 18.40 % $ 17,493 8.00 % $ 21,867 10.00 % Tier 1 Risk-Based Capital $ 37,975 17.37 % $ 13,120 6.00 % $ 17,493 8.00 % Tier 1 Leverage $ 37,975 10.76 % $ 14,113 4.00 % $ 17,641 5.00 % To Be Well Capitalized To Be Considered Under Prompt Corrective Actual Adequately Capitalized Action Provisions (dollars in thousands) Amount Ratio Amount Ratio Amount Ratio As of December 31, 2022 Common Equity Tier 1 Capital $ 37,963 16.45 % $ 10,383 4.50 % $ 14,998 6.50 % Total Risk-Based Capital $ 39,866 17.28 % $ 18,459 8.00 % $ 23,074 10.00 % Tier 1 Risk-Based Capital $ 37,963 16.45 % $ 13,845 6.00 % $ 18,459 8.00 % Tier 1 Leverage $ 37,963 9.53 % $ 15,938 4.00 % $ 19,922 5.00 % |
Earnings Per Common Share (Tabl
Earnings Per Common Share (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Earnings Per Common Share | |
Schedule of earnings per common share | Year Ended December 31, 2023 2022 Basic earnings per share: Net income $ 1,429,094 $ 1,745,182 Weighted average common shares outstanding 2,873,500 2,859,239 Basic net income per share $ 0.50 $ 0.61 |
Fair Values of Financial Inst_2
Fair Values of Financial Instruments (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Fair Values of Financial Instruments | |
Schedule of estimated fair values of financial instruments | December 31, 2023 December 31, 2022 (dollars in thousands) Carrying Fair Carrying Fair Amount Value Amount Value Financial assets: Cash and due from banks $ 1,940 $ 1,940 $ 2,035 $ 2,035 Interest-bearing deposits in other financial institutions 12,189 12,189 22,680 22,680 Federal funds sold 1,112 1,112 5,377 5,377 Investment securities available for sale 139,427 139,427 144,133 144,133 Investments in restricted stock 1,217 1,217 221 221 Ground rents 130 130 131 131 Loans, less allowance for credit losses 174,150 161,802 184,278 177,254 Accrued interest receivable 1,192 1,192 1,159 1,159 Cash value of life insurance 8,657 8,657 8,493 8,493 Financial liabilities: Deposits 300,067 252,707 362,947 299,773 Short-term borrowings 30,000 30,000 — — Accrued interest payable 366 366 9 9 Unrecognized financial instruments: Commitments to extend credit 33,162 33,162 30,718 30,718 Standby letters of credit 45 45 45 45 |
Schedule of fair value hierarchy of financial instruments | (dollars in thousands) Carrying Fair December 31, 2023 Amount Value Level 1 Level 2 Level 3 Financial instruments - Assets Cash and cash equivalents $ 15,241 $ 15,241 $ 15,241 — $ — Loans receivable, net 174,150 161,802 — — 161,802 Cash value of life insurance 8,657 8,657 — 8,657 — Financial instruments - Liabilities Deposits 300,067 252,707 33,118 219,589 — |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Fair Value Measurements | |
Schedule of fair value measurements on a recurring and non-recurring basis | Fair (dollars in thousands) Level 1 Level 2 Level 3 Value December 31, 2023 Recurring: Securities available for sale U.S. Treasury $ 6,945 $ — $ — $ 6,945 State and Municipal — 33,729 — 33,729 Mortgaged-backed 531 96,938 — 97,469 Corporate securities — 1,284 — 1,284 Non-recurring: Impaired loans — — 398 398 $ 7,476 $ 131,951 $ 398 $ 139,825 December 31, 2022 Recurring: Securities available for sale U.S. Treasury State and Municipal — $ 6,783 $ — $ 6,783 Mortgaged-backed — 32,297 — 32,297 Corporate securities — 103,728 — 103,728 Interest rate swap — 1,325 — 1,325 Non-recurring: Impaired loans — — 330 330 $ — $ 144,133 $ 330 $ 144,463 |
Parent Company Financial Info_2
Parent Company Financial Information (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Parent Company Financial Information | |
Schedule of balance sheets statement | ___________________________________________Balance Sheets________________________________________ December 31, 2023 2022 (dollars in thousands) Assets Cash $ 88 $ 77 Investment in The Bank of Glen Burnie 19,227 15,975 Other assets 10 2 Total assets $ 19,325 $ 16,054 Liabilities and Stockholders’ Equity Stockholders’ equity: Common stock 2,883 2,865 Surplus 10,964 10,862 Retained earnings 23,859 23,579 Accumulated other comprehensive loss, net of benefits (18,381) (21,252) Total stockholders’ equity 19,325 16,054 Total liabilities and stockholders’ equity $ 19,325 $ 16,054 |
Schedule of income statement | __________________________________________Statements of Income___________________________________ Year Ended December 31, 2023 2022 (dollars in thousands) Dividends and distributions from subsidiary $ 1,210 $ 1,210 Other expenses (205) (243) Income before income tax benefit and equity in undistributed net income of subsidiary 1,005 967 Income tax benefit 43 39 Change in undistributed equity of subsidiary 381 739 Net income $ 1,429 $ 1,745 |
Schedule of cash flow statement | ___________________________________Statements of Cash Flows_______________________________________ Year Ended December 31, 2023 2022 (dollars in thousands) Cash flows from operating activities: Net income $ 1,429 $ 1,745 Adjustments to reconcile net income to net cash provided by operating activities: Increase in other assets (8) — Change in undistributed equity of subsidiary (381) (739) Net cash provided by operating activities 1,040 1,006 Cash flows from financing activities: Proceeds from dividend reinvestment plan 120 115 Dividends paid (1,149) (1,143) Net cash used in financing activities (1,029) (1,028) Increase (decrease) in cash 11 (22) Cash, beginning of year 77 99 Cash, end of year $ 88 $ 77 |
Quarterly Results of Operatio_2
Quarterly Results of Operations (Unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Quarterly Results of Operations (Unaudited) | |
Schedule of summary of consolidated unaudited quarterly results of operations | (dollars in thousands, Three months ended except per share amounts) December 31, September 30, June 30, March 31, Interest income $ 3,435 $ 3,350 $ 3,267 $ 3,285 Interest expense 544 398 153 107 Net interest income 2,891 2,952 3,114 3,178 Provision for credit losses 103 (92) 127 (42) Net securities gains — — — — Gain on swap contract termination — — — — Income before income taxes 140 539 301 521 Net income 167 552 275 435 Net income per share (basic and diluted) $ 0.06 $ 0.19 $ 0.10 $ 0.15 __________________________________________2022__________________________________ (dollars in thousands, Three months ended except per share amounts) December 31, September 30, June 30, March 31, Interest income $ 3,458 $ 3,308 $ 3,030 $ 2,916 Interest expense 120 271 228 234 Net interest income 3,338 3,037 2,802 2,682 Provision for credit losses 66 39 (117) (100) Net securities gains — 2 — — Gain on swap contract termination 206 — — — Income before income taxes 994 395 345 251 Net income 830 375 309 231 Net income per share (basic and diluted) $ 0.29 $ 0.13 $ 0.11 $ 0.08 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2023 | Dec. 31, 2022 | |
FHLB stock sold back at par value | $ 100 | ||
Sales of OREO | $ 0 | $ 0 | |
Loans transferred to OREO through foreclosure proceedings | $ 0 | 0 | 0 |
Gain on cancellation of interest rate swap contracts | $ 206,000 | $ 0 | $ 206,000 |
Minimum | Computer software | |||
Amortized cost, useful life | 3 years | ||
Maximum | Computer software | |||
Amortized cost, useful life | 5 years |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Advertising Expense (Details) - USD ($) $ in Millions | 12 Months Ended | 24 Months Ended |
Dec. 31, 2022 | Dec. 31, 2023 | |
Summary of Significant Accounting Policies | ||
Advertising expense | $ 0.1 | $ 0.1 |
Restrictions on Cash and Amou_2
Restrictions on Cash and Amounts Due From Banks (Details) - USD ($) $ in Millions | Dec. 31, 2023 | Dec. 31, 2022 |
Restrictions on Cash and Amounts Due from Banks | ||
Deposit liabilities reserves average | $ 0 | $ 0 |
Investment Securities - Amortiz
Investment Securities - Amortized Cost and Market Value of Securities Available for Sale (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Investment Securities | ||
Amortized Cost | $ 164,787 | $ 173,453 |
Gross Unrealized Gains | 12 | 8 |
Gross Unrealized Losses | (25,372) | (29,328) |
Fair Value | 139,427 | 144,133 |
Trading securities | 0 | 0 |
Held to maturity | 0 | 0 |
Collateralized mortgage obligations | ||
Investment Securities | ||
Amortized Cost | 15,962 | 17,596 |
Gross Unrealized Gains | 8 | 7 |
Gross Unrealized Losses | (2,309) | (2,348) |
Fair Value | 13,661 | 15,255 |
Agency mortgage-backed securities | ||
Investment Securities | ||
Amortized Cost | 51,930 | 58,801 |
Gross Unrealized Losses | (5,816) | (6,908) |
Fair Value | 46,114 | 51,893 |
Municipal securities | ||
Investment Securities | ||
Amortized Cost | 42,990 | 43,092 |
Gross Unrealized Gains | 4 | 1 |
Gross Unrealized Losses | (9,265) | (10,796) |
Fair Value | 33,729 | 32,297 |
U.S. Government agency securities | ||
Investment Securities | ||
Amortized Cost | 45,406 | 45,471 |
Gross Unrealized Losses | (7,712) | (8,891) |
Fair Value | 37,694 | 36,580 |
Corporate securities | ||
Investment Securities | ||
Amortized Cost | 1,500 | 1,500 |
Gross Unrealized Losses | (216) | (175) |
Fair Value | 1,284 | 1,325 |
U.S. Treasury securities | ||
Investment Securities | ||
Amortized Cost | 6,999 | 6,993 |
Gross Unrealized Losses | (54) | (210) |
Fair Value | $ 6,945 | $ 6,783 |
Investment Securities - Gross U
Investment Securities - Gross Unrealized Losses and Fair Value Aggregated by Investment Category and Length of Time in Continuous Unrealized Loss Position (Details) $ in Thousands | Dec. 31, 2023 USD ($) security | Dec. 31, 2022 USD ($) |
Investment Securities | ||
Less than 12 months Fair Value | $ 3,695 | $ 67,109 |
Less than 12 months Unrealized Loss | (41) | (7,794) |
12 months or more Fair Value | 132,405 | 75,424 |
12 months or more Unrealized Loss | (25,331) | (21,534) |
Total Fair Value | 136,100 | 142,533 |
Total Unrealized Loss | (25,372) | (29,328) |
Collateralized mortgage obligations | ||
Investment Securities | ||
Less than 12 months Fair Value | 492 | 8,315 |
Less than 12 months Unrealized Loss | (1) | (364) |
12 months or more Fair Value | 11,927 | 6,127 |
12 months or more Unrealized Loss | (2,308) | (1,984) |
Total Fair Value | 12,419 | 14,442 |
Total Unrealized Loss | $ (2,309) | (2,348) |
Number of securities continuous unrealized loss position more than twelve months | security | 72 | |
Agency mortgage-backed securities | ||
Investment Securities | ||
Less than 12 months Fair Value | $ 5 | 20,029 |
Less than 12 months Unrealized Loss | (1,308) | |
12 months or more Fair Value | 46,109 | 31,865 |
12 months or more Unrealized Loss | (5,816) | (5,600) |
Total Fair Value | 46,114 | 51,894 |
Total Unrealized Loss | $ (5,816) | (6,908) |
Number of securities continuous unrealized loss position more than twelve months | security | 83 | |
Municipal securities | ||
Investment Securities | ||
Less than 12 months Fair Value | $ 2,978 | 18,456 |
Less than 12 months Unrealized Loss | (39) | (5,438) |
12 months or more Fair Value | 28,667 | 13,340 |
12 months or more Unrealized Loss | (9,226) | (5,358) |
Total Fair Value | 31,645 | 31,796 |
Total Unrealized Loss | $ (9,265) | (10,796) |
Number of securities continuous unrealized loss position more than twelve months | security | 31 | |
U.S. Government agency securities | ||
Investment Securities | ||
Less than 12 months Fair Value | $ 220 | 13,526 |
Less than 12 months Unrealized Loss | (1) | (474) |
12 months or more Fair Value | 37,474 | 22,767 |
12 months or more Unrealized Loss | (7,711) | (8,417) |
Total Fair Value | 37,694 | 36,293 |
Total Unrealized Loss | $ (7,712) | (8,891) |
Number of securities continuous unrealized loss position more than twelve months | security | 57 | |
Corporate securities | ||
Investment Securities | ||
12 months or more Fair Value | $ 1,284 | 1,325 |
12 months or more Unrealized Loss | (216) | (175) |
Total Fair Value | 1,284 | 1,325 |
Total Unrealized Loss | $ (216) | (175) |
Number of securities continuous unrealized loss position more than twelve months | security | 1 | |
U.S. Treasury securities | ||
Investment Securities | ||
Less than 12 months Fair Value | 6,783 | |
Less than 12 months Unrealized Loss | (210) | |
12 months or more Fair Value | $ 6,944 | |
12 months or more Unrealized Loss | (54) | |
Total Fair Value | 6,944 | 6,783 |
Total Unrealized Loss | $ (54) | $ (210) |
Number of securities continuous unrealized loss position more than twelve months | security | 1 |
Investment Securities - Contrac
Investment Securities - Contractual Maturities of Investment Securities (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Available for Sale Amortized Cost | ||
Due within one year | $ 20,998 | |
Due over one to five years | 5,080 | |
Due over five to ten years | 14,665 | |
Due over ten years | 56,152 | |
Amortized Cost | 164,787 | $ 173,453 |
Available for Sale Fair Value | ||
Due within one year | 20,814 | |
Due over one to five years | 4,584 | |
Due over five to ten years | 12,621 | |
Due over ten years | 41,633 | |
Fair Value | 139,427 | 144,133 |
Collateralized mortgage obligations | ||
Available for Sale Amortized Cost | ||
Amortized Cost | 15,962 | 17,596 |
Available for Sale Fair Value | ||
Fair Value | 13,661 | 15,255 |
Agency mortgage-backed securities | ||
Available for Sale Amortized Cost | ||
Amortized Cost | 51,930 | 58,801 |
Available for Sale Fair Value | ||
Fair Value | $ 46,114 | $ 51,893 |
Investment Securities (Details)
Investment Securities (Details) | 12 Months Ended | |
Dec. 31, 2023 USD ($) security | Dec. 31, 2022 USD ($) security | |
Schedule of Available-for-sale Securities | ||
Impairment charges to securities | $ 0 | $ 0 |
Investment securities pledged as collateral | 13,200,000 | 0 |
Unrealized loss | 25,372,000 | 29,328,000 |
Investment securities available for sale, at fair value | 139,427,000 | 144,133,000 |
Sales of available for sale debt securities | $ 0 | $ 0 |
Private Label Mortgage-Backed securities | ||
Schedule of Available-for-sale Securities | ||
Number of investment securities portfolio held | security | 0 | 0 |
Collateralized mortgage obligations | ||
Schedule of Available-for-sale Securities | ||
Number of investment securities portfolio held | security | 0 | 0 |
Unrealized loss | $ 2,309,000 | $ 2,348,000 |
Investment securities available for sale, at fair value | $ 13,661,000 | $ 15,255,000 |
Loans and Allowance for Credi_3
Loans and Allowance for Credit Losses - Loans - Major Categories of Loans (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Loans and Allowance for Credit Losses - Loans | |||
Loans, net of deferred fees and costs | $ 176,307,000 | $ 186,440,000 | |
Less: Allowance for credit losses | (2,157,000) | (2,162,000) | $ (2,470,000) |
Loans, net | 174,150,000 | 184,278,000 | |
Increase (decrease) in loans and leases receivable | $ 10,100,000 | ||
Percentage of increase (decrease) in loans and leases receivable | 5.50% | ||
Related party loans | $ 150,000 | 0 | |
Real Estate Loan | |||
Loans and Allowance for Credit Losses - Loans | |||
Loans, net of deferred fees and costs | 136,230,000 | 133,323,000 | |
Commercial and Industrial | |||
Loans and Allowance for Credit Losses - Loans | |||
Loans, net of deferred fees and costs | 16,774,000 | 15,148,000 | |
Consumer Loans | |||
Loans and Allowance for Credit Losses - Loans | |||
Loans, net of deferred fees and costs | 23,303,000 | 37,969,000 | |
Construction and Land | Real Estate Loan | |||
Loans and Allowance for Credit Losses - Loans | |||
Loans, net of deferred fees and costs | 4,636,000 | 4,499,000 | |
Less: Allowance for credit losses | (31,000) | (44,000) | (5,000) |
Loans, net | 4,600,000 | 4,500,000 | |
Increase (decrease) in loans and leases receivable | $ 100,000 | ||
Percentage of increase (decrease) in loans and leases receivable | 3.04% | ||
Farmland | Real Estate Loan | |||
Loans and Allowance for Credit Losses - Loans | |||
Loans, net of deferred fees and costs | $ 325,000 | 333,000 | |
Less: Allowance for credit losses | (18,000) | (20,000) | (11,000) |
Loans, net | 300,000 | ||
Single-family Residential | Real Estate Loan | |||
Loans and Allowance for Credit Losses - Loans | |||
Loans, net of deferred fees and costs | 86,887,000 | 80,251,000 | |
Less: Allowance for credit losses | (1,290,000) | (1,230,000) | (1,357,000) |
Loans, net | 86,900,000 | 80,300,000 | |
Increase (decrease) in loans and leases receivable | $ 6,600,000 | ||
Percentage of increase (decrease) in loans and leases receivable | 8.27% | ||
Multi-family | Real Estate Loan | |||
Loans and Allowance for Credit Losses - Loans | |||
Loans, net of deferred fees and costs | $ 5,165,000 | 5,304,000 | |
Less: Allowance for credit losses | (96,000) | (103,000) | (105,000) |
Loans, net | 5,200,000 | 5,300,000 | |
Increase (decrease) in loans and leases receivable | $ 100,000 | ||
Percentage of increase (decrease) in loans and leases receivable | 2.62% | ||
Commercial | Real Estate Loan | |||
Loans and Allowance for Credit Losses - Loans | |||
Loans, net of deferred fees and costs | $ 39,217,000 | 42,936,000 | |
Less: Allowance for credit losses | (190,000) | (221,000) | (278,000) |
Loans, net | 39,200,000 | 42,900,000 | |
Increase (decrease) in loans and leases receivable | $ 3,700,000 | ||
Percentage of increase (decrease) in loans and leases receivable | 8.66% | ||
Commercial | Commercial and Industrial | |||
Loans and Allowance for Credit Losses - Loans | |||
Loans, net of deferred fees and costs | $ 16,774,000 | 15,148,000 | |
Commercial and industrial | Commercial and Industrial | |||
Loans and Allowance for Credit Losses - Loans | |||
Loans, net of deferred fees and costs | 10,850,000 | 8,990,000 | |
Less: Allowance for credit losses | (304,000) | (174,000) | (115,000) |
Loans, net | 10,900,000 | 9,000,000 | |
Increase (decrease) in loans and leases receivable | $ 1,900,000 | ||
Percentage of increase (decrease) in loans and leases receivable | 20.69% | ||
SBA Guaranty | Commercial and Industrial | |||
Loans and Allowance for Credit Losses - Loans | |||
Loans, net of deferred fees and costs | $ 5,924,000 | 6,158,000 | |
Less: Allowance for credit losses | (21,000) | (22,000) | (30,000) |
Loans, net | 5,900,000 | 6,200,000 | |
Increase (decrease) in loans and leases receivable | $ 300,000 | ||
Percentage of increase (decrease) in loans and leases receivable | 3.79% | ||
Consumer | |||
Loans and Allowance for Credit Losses - Loans | |||
Loans, net | $ 21,300,000 | 36,400,000 | |
Consumer | Consumer Loans | |||
Loans and Allowance for Credit Losses - Loans | |||
Loans, net of deferred fees and costs | 2,039,000 | 1,521,000 | |
Less: Allowance for credit losses | (30,000) | (23,000) | (36,000) |
Loans, net | 2,000,000 | 1,500,000 | |
Increase (decrease) in loans and leases receivable | $ 500,000 | ||
Percentage of increase (decrease) in loans and leases receivable | 34.06% | ||
Automobile | Consumer Loans | |||
Loans and Allowance for Credit Losses - Loans | |||
Loans, net of deferred fees and costs | $ 21,264,000 | 36,448,000 | |
Less: Allowance for credit losses | (177,000) | (325,000) | $ (533,000) |
Loans, net | 21,300,000 | $ 36,400,000 | |
Increase (decrease) in loans and leases receivable | $ 15,100,000 | ||
Percentage of increase (decrease) in loans and leases receivable | 41.66% |
Loans and Allowance for Credi_4
Loans and Allowance for Credit Losses - Loans - Related parties (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Loans and Leases Receivable, Related Parties | ||
Balance at beginning of year | $ 0 | |
Additions | 150 | $ 1,078 |
Repayments | (1,078) | |
Balance at end of year | $ 150 | $ 0 |
Loans and Allowance for Credi_5
Loans and Allowance for Credit Losses - Loans - Allowance by Loan Segment (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Financing Receivable, Allowance for Credit Losses | ||
Balance, beginning of year | $ 2,162,000 | $ 2,470,000 |
Charged off | (203,000) | (392,000) |
Charge-offs | (203,000) | (392,000) |
Recoveries | 102,000 | 196,000 |
(Release) provision for credit losses | 96,000 | (112,000) |
Balance, end of year | 2,157,000 | 2,162,000 |
Individually evaluated for impairment: | ||
Individually evaluated for impairment, Balance in allowance | 200,000 | 79,000 |
Individually evaluated for impairment, Related loan balance | 329,000 | 334,000 |
Collectively evaluated for impairment: | ||
Collectively evaluated for impairment, Balance in allowance | 1,957,000 | 2,083,000 |
Collectively evaluated for impairment, Related loan balance | 175,978,000 | 186,106,000 |
Real Estate Loan | ||
Individually evaluated for impairment: | ||
Individually evaluated for impairment, Balance in allowance | 21,000 | 20,000 |
Commercial and Industrial | ||
Individually evaluated for impairment: | ||
Individually evaluated for impairment, Balance in allowance | 179,000 | 59,000 |
Construction and Land | Real Estate Loan | ||
Financing Receivable, Allowance for Credit Losses | ||
Balance, beginning of year | 44,000 | 5,000 |
(Release) provision for credit losses | (13,000) | 39,000 |
Balance, end of year | 31,000 | 44,000 |
Collectively evaluated for impairment: | ||
Collectively evaluated for impairment, Balance in allowance | 31,000 | 44,000 |
Collectively evaluated for impairment, Related loan balance | 4,636,000 | 4,499,000 |
Farmland | Real Estate Loan | ||
Financing Receivable, Allowance for Credit Losses | ||
Balance, beginning of year | 20,000 | 11,000 |
(Release) provision for credit losses | (2,000) | 9,000 |
Balance, end of year | 18,000 | 20,000 |
Collectively evaluated for impairment: | ||
Collectively evaluated for impairment, Balance in allowance | 18,000 | 20,000 |
Collectively evaluated for impairment, Related loan balance | 325,000 | 333,000 |
Single-family Residential | Real Estate Loan | ||
Financing Receivable, Allowance for Credit Losses | ||
Balance, beginning of year | 1,230,000 | 1,357,000 |
(Release) provision for credit losses | 60,000 | (127,000) |
Balance, end of year | 1,290,000 | 1,230,000 |
Individually evaluated for impairment: | ||
Individually evaluated for impairment, Balance in allowance | 21,000 | 20,000 |
Individually evaluated for impairment, Related loan balance | 30,000 | 34,000 |
Collectively evaluated for impairment: | ||
Collectively evaluated for impairment, Balance in allowance | 1,269,000 | 1,210,000 |
Collectively evaluated for impairment, Related loan balance | 86,857,000 | 80,217,000 |
Multi-family | Real Estate Loan | ||
Financing Receivable, Allowance for Credit Losses | ||
Balance, beginning of year | 103,000 | 105,000 |
(Release) provision for credit losses | (7,000) | (2,000) |
Balance, end of year | 96,000 | 103,000 |
Collectively evaluated for impairment: | ||
Collectively evaluated for impairment, Balance in allowance | 96,000 | 103,000 |
Collectively evaluated for impairment, Related loan balance | 5,165,000 | 5,304,000 |
Commercial and Industrial | Commercial and Industrial | ||
Financing Receivable, Allowance for Credit Losses | ||
Balance, beginning of year | 174,000 | 115,000 |
Charge-offs | (200,000) | |
(Release) provision for credit losses | 130,000 | 259,000 |
Balance, end of year | 304,000 | 174,000 |
Individually evaluated for impairment: | ||
Individually evaluated for impairment, Balance in allowance | 179,000 | 59,000 |
Individually evaluated for impairment, Related loan balance | 299,000 | 300,000 |
Collectively evaluated for impairment: | ||
Collectively evaluated for impairment, Balance in allowance | 125,000 | 115,000 |
Collectively evaluated for impairment, Related loan balance | 10,551,000 | 8,690,000 |
Commercial | Real Estate Loan | ||
Financing Receivable, Allowance for Credit Losses | ||
Balance, beginning of year | 221,000 | 278,000 |
(Release) provision for credit losses | (31,000) | (57,000) |
Balance, end of year | 190,000 | 221,000 |
Collectively evaluated for impairment: | ||
Collectively evaluated for impairment, Balance in allowance | 190,000 | 221,000 |
Collectively evaluated for impairment, Related loan balance | 39,217,000 | 42,936,000 |
SBA Guaranty | Commercial and Industrial | ||
Financing Receivable, Allowance for Credit Losses | ||
Balance, beginning of year | 22,000 | 30,000 |
Charge-offs | (9,000) | |
(Release) provision for credit losses | (1,000) | 1,000 |
Balance, end of year | 21,000 | 22,000 |
Collectively evaluated for impairment: | ||
Collectively evaluated for impairment, Balance in allowance | 21,000 | 22,000 |
Collectively evaluated for impairment, Related loan balance | 5,924,000 | 6,158,000 |
Consumer | Consumer Loans | ||
Financing Receivable, Allowance for Credit Losses | ||
Balance, beginning of year | 23,000 | 36,000 |
Charged off | (79,000) | |
Charge-offs | (79,000) | (14,000) |
Recoveries | 1,000 | 8,000 |
(Release) provision for credit losses | 85,000 | (7,000) |
Balance, end of year | 30,000 | 23,000 |
Collectively evaluated for impairment: | ||
Collectively evaluated for impairment, Balance in allowance | 30,000 | 23,000 |
Collectively evaluated for impairment, Related loan balance | 2,039,000 | 1,521,000 |
Automobile | Consumer Loans | ||
Financing Receivable, Allowance for Credit Losses | ||
Balance, beginning of year | 325,000 | 533,000 |
Charged off | (124,000) | |
Charge-offs | (124,000) | (169,000) |
Recoveries | 101,000 | 188,000 |
(Release) provision for credit losses | (125,000) | (227,000) |
Balance, end of year | 177,000 | 325,000 |
Collectively evaluated for impairment: | ||
Collectively evaluated for impairment, Balance in allowance | 177,000 | 325,000 |
Collectively evaluated for impairment, Related loan balance | $ 21,264,000 | $ 36,448,000 |
Loans and Allowance for Credi_6
Loans and Allowance for Credit Losses - Loans - Allowance for Credit Losses (Details) | 12 Months Ended | |
Dec. 31, 2023 USD ($) borrower | Dec. 31, 2022 USD ($) borrower | |
Financing Receivable, Allowance For Credit Losses [Line Items] | ||
Number of borrowers | borrower | 12 | 19 |
Loans charged off | $ 203,000 | $ 392,000 |
Term Loans by Origination Year | ||
2021 | 47,000 | |
2020 | 43,000 | |
2019 | 27,000 | |
Prior | 86,000 | |
Total | 203,000 | $ 392,000 |
Consumer | Consumer Loans | ||
Financing Receivable, Allowance For Credit Losses [Line Items] | ||
Loans charged off | 79,000 | |
Term Loans by Origination Year | ||
Prior | 79,000 | |
Total | 79,000 | |
Automobile | Consumer Loans | ||
Financing Receivable, Allowance For Credit Losses [Line Items] | ||
Loans charged off | 124,000 | |
Term Loans by Origination Year | ||
2021 | 47,000 | |
2020 | 43,000 | |
2019 | 27,000 | |
Prior | 7,000 | |
Total | $ 124,000 |
Loans and Allowance for Credi_7
Loans and Allowance for Credit Losses - Loans - Non-accrual loans (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Financing Receivable Nonaccrual Status | ||
Balance | $ 488 | $ 338 |
Transfer into non-accrual | 482 | 751 |
Loans paid down/payoffs | (301) | (230) |
Loans returned to accrual status | (19) | (29) |
Loans charged off | (124) | (342) |
Balance | 527 | 488 |
Real Estate Loan | ||
Financing Receivable Nonaccrual Status | ||
Balance | 104 | |
Balance | 145 | 104 |
Commercial and Industrial | ||
Financing Receivable Nonaccrual Status | ||
Balance | 299 | |
Balance | 299 | 299 |
Consumer Loans | ||
Financing Receivable Nonaccrual Status | ||
Balance | 85 | |
Balance | 83 | 85 |
Single-family Residential | Real Estate Loan | ||
Financing Receivable Nonaccrual Status | ||
Balance | 104 | 123 |
Transfer into non-accrual | 307 | 31 |
Loans paid down/payoffs | (266) | (50) |
Balance | 145 | 104 |
Commercial and Industrial | Commercial and Industrial | ||
Financing Receivable Nonaccrual Status | ||
Balance | 299 | |
Transfer into non-accrual | 502 | |
Loans paid down/payoffs | (3) | |
Loans charged off | (200) | |
Balance | 299 | 299 |
SBA Guaranty | Commercial and Industrial | ||
Financing Receivable Nonaccrual Status | ||
Balance | 71 | |
Loans paid down/payoffs | (61) | |
Loans charged off | (10) | |
Consumer | Consumer Loans | ||
Financing Receivable Nonaccrual Status | ||
Transfer into non-accrual | 11 | |
Loans paid down/payoffs | (11) | |
Automobile | Consumer Loans | ||
Financing Receivable Nonaccrual Status | ||
Balance | 85 | 144 |
Transfer into non-accrual | 175 | 207 |
Loans paid down/payoffs | (35) | (105) |
Loans returned to accrual status | (19) | (29) |
Loans charged off | (124) | (132) |
Balance | $ 83 | $ 85 |
Loans and Allowance for Credi_8
Loans and Allowance for Credit Losses - Loans - Credit quality indicators by year of origination (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Loans and Allowance for Credit Losses - Loans | ||
Total | $ 176,307 | $ 186,440 |
Pass | ||
Loans and Allowance for Credit Losses - Loans | ||
Total | 175,709 | 185,952 |
Substandard | ||
Loans and Allowance for Credit Losses - Loans | ||
Total | 598 | 483 |
Doubtful | ||
Loans and Allowance for Credit Losses - Loans | ||
Total | 5 | |
Real Estate Loan | ||
Loans and Allowance for Credit Losses - Loans | ||
2022 | 15,316 | |
2021 | 12,507 | 11,941 |
2020 | 16,675 | 17,685 |
2019 | 9,739 | 10,337 |
2018 | 9,457 | 9,852 |
2017 | 12,670 | |
Prior | 72,536 | 70,838 |
Total | 136,230 | 133,323 |
Real Estate Loan | Pass | ||
Loans and Allowance for Credit Losses - Loans | ||
2022 | 15,316 | |
2021 | 12,507 | 11,941 |
2020 | 16,675 | 17,685 |
2019 | 9,739 | 10,337 |
2018 | 9,457 | 9,852 |
2017 | 12,670 | |
Prior | 72,391 | 70,734 |
Total | 136,085 | 133,219 |
Real Estate Loan | Non accrual | ||
Loans and Allowance for Credit Losses - Loans | ||
Prior | 145 | 104 |
Total | 145 | 104 |
Commercial and Industrial | ||
Loans and Allowance for Credit Losses - Loans | ||
2022 | 3,515 | |
2021 | 1,099 | 1,468 |
2020 | 452 | 748 |
2019 | 3,834 | 4,056 |
2018 | 711 | 875 |
2017 | 3,581 | |
Prior | 7,163 | 4,420 |
Total | 16,774 | 15,148 |
Commercial and Industrial | Pass | ||
Loans and Allowance for Credit Losses - Loans | ||
2022 | 3,515 | |
2021 | 1,099 | 1,468 |
2020 | 153 | 449 |
2019 | 3,834 | 4,056 |
2018 | 711 | 875 |
2017 | 3,581 | |
Prior | 7,163 | 4,420 |
Total | 16,475 | 14,849 |
Commercial and Industrial | Non accrual | ||
Loans and Allowance for Credit Losses - Loans | ||
2020 | 299 | 299 |
Total | 299 | 299 |
Consumer Loans | ||
Loans and Allowance for Credit Losses - Loans | ||
2022 | 2,140 | |
2021 | 4,625 | 6,573 |
2020 | 5,737 | 8,659 |
2019 | 3,373 | 5,200 |
2018 | 3,481 | 6,792 |
2017 | 8,153 | |
Prior | 3,947 | 2,592 |
Total | 23,303 | 37,969 |
Consumer Loans | Pass | ||
Loans and Allowance for Credit Losses - Loans | ||
2022 | 2,140 | |
2021 | 4,598 | 6,573 |
2020 | 5,697 | 8,632 |
2019 | 3,364 | 5,187 |
2018 | 3,481 | 6,792 |
2017 | 8,113 | |
Prior | 3,940 | 2,587 |
Total | 23,220 | 37,884 |
Consumer Loans | Non accrual | ||
Loans and Allowance for Credit Losses - Loans | ||
2021 | 27 | |
2020 | 40 | 27 |
2019 | 9 | 13 |
2017 | 40 | |
Prior | 7 | 5 |
Total | $ 83 | $ 85 |
Loans and Allowance for Credi_9
Loans and Allowance for Credit Losses - Loans - Credit Quality Information (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 USD ($) loan | Dec. 31, 2022 USD ($) loan | Dec. 31, 2021 USD ($) | |
Loans and Allowance for Credit Losses - Loans | |||
Non-accrual | $ 527 | $ 488 | $ 338 |
Troubled debt restructured loans | $ 30 | $ 34 | |
Number of TDRs accounts | loan | 1 | 1 | |
Loans and Leases Receivable, Gross | $ 176,307 | $ 186,440 | |
Non-performing TDRs | |||
Loans and Allowance for Credit Losses - Loans | |||
Non-performing TDRs | 30 | 34 | |
Number of non-performing TDRs accounts | loan | 1 | 1 | |
Pass | |||
Loans and Allowance for Credit Losses - Loans | |||
Loans and Leases Receivable, Gross | $ 175,709 | $ 185,952 | |
Substandard | |||
Loans and Allowance for Credit Losses - Loans | |||
Loans and Leases Receivable, Gross | 598 | 483 | |
Doubtful | |||
Loans and Allowance for Credit Losses - Loans | |||
Loans and Leases Receivable, Gross | 5 | ||
Real Estate Loan | |||
Loans and Allowance for Credit Losses - Loans | |||
Non-accrual | 145 | 104 | |
Loans and Leases Receivable, Gross | 136,230 | 133,323 | |
Real Estate Loan | Pass | |||
Loans and Allowance for Credit Losses - Loans | |||
Loans and Leases Receivable, Gross | 136,085 | 133,219 | |
Commercial and Industrial | |||
Loans and Allowance for Credit Losses - Loans | |||
Non-accrual | 299 | 299 | |
Loans and Leases Receivable, Gross | 16,774 | 15,148 | |
Commercial and Industrial | Pass | |||
Loans and Allowance for Credit Losses - Loans | |||
Loans and Leases Receivable, Gross | 16,475 | 14,849 | |
Consumer Loans | |||
Loans and Allowance for Credit Losses - Loans | |||
Non-accrual | 83 | 85 | |
Loans and Leases Receivable, Gross | 23,303 | 37,969 | |
Consumer Loans | Pass | |||
Loans and Allowance for Credit Losses - Loans | |||
Loans and Leases Receivable, Gross | 23,220 | 37,884 | |
Construction and Land | Real Estate Loan | |||
Loans and Allowance for Credit Losses - Loans | |||
Loans and Leases Receivable, Gross | 4,636 | 4,499 | |
Construction and Land | Real Estate Loan | Pass | |||
Loans and Allowance for Credit Losses - Loans | |||
Loans and Leases Receivable, Gross | 4,636 | 4,499 | |
Farmland | Real Estate Loan | |||
Loans and Allowance for Credit Losses - Loans | |||
Loans and Leases Receivable, Gross | 325 | 333 | |
Farmland | Real Estate Loan | Pass | |||
Loans and Allowance for Credit Losses - Loans | |||
Loans and Leases Receivable, Gross | 325 | 333 | |
Single-family Residential | Real Estate Loan | |||
Loans and Allowance for Credit Losses - Loans | |||
Non-accrual | 145 | 104 | 123 |
Troubled debt restructured loans | $ 30 | $ 34 | |
Number of TDRs accounts | loan | 1 | 1 | |
Loans and Leases Receivable, Gross | $ 86,887 | $ 80,251 | |
Single-family Residential | Real Estate Loan | Non-performing TDRs | |||
Loans and Allowance for Credit Losses - Loans | |||
Non-performing TDRs | 30 | 34 | |
Number of non-performing TDRs accounts | loan | 1 | 1 | |
Single-family Residential | Real Estate Loan | Pass | |||
Loans and Allowance for Credit Losses - Loans | |||
Loans and Leases Receivable, Gross | $ 86,743 | $ 80,147 | |
Single-family Residential | Real Estate Loan | Substandard | |||
Loans and Allowance for Credit Losses - Loans | |||
Loans and Leases Receivable, Gross | 145 | 104 | |
Multi-family | Real Estate Loan | |||
Loans and Allowance for Credit Losses - Loans | |||
Loans and Leases Receivable, Gross | 5,165 | 5,304 | |
Multi-family | Real Estate Loan | Pass | |||
Loans and Allowance for Credit Losses - Loans | |||
Loans and Leases Receivable, Gross | 5,165 | 5,304 | |
Commercial | Real Estate Loan | |||
Loans and Allowance for Credit Losses - Loans | |||
Loans and Leases Receivable, Gross | 39,217 | 42,936 | |
Commercial | Real Estate Loan | Pass | |||
Loans and Allowance for Credit Losses - Loans | |||
Loans and Leases Receivable, Gross | 39,217 | 42,936 | |
Commercial | Commercial and Industrial | |||
Loans and Allowance for Credit Losses - Loans | |||
Loans and Leases Receivable, Gross | 16,774 | 15,148 | |
Commercial | Commercial and Industrial | Pass | |||
Loans and Allowance for Credit Losses - Loans | |||
Loans and Leases Receivable, Gross | 10,551 | ||
Commercial and Industrial | Commercial and Industrial | |||
Loans and Allowance for Credit Losses - Loans | |||
Non-accrual | 299 | 299 | |
Loans and Leases Receivable, Gross | 10,850 | 8,990 | |
Commercial and Industrial | Commercial and Industrial | Pass | |||
Loans and Allowance for Credit Losses - Loans | |||
Loans and Leases Receivable, Gross | 8,691 | ||
Commercial and Industrial | Commercial and Industrial | Substandard | |||
Loans and Allowance for Credit Losses - Loans | |||
Loans and Leases Receivable, Gross | 299 | 299 | |
SBA Guaranty | Commercial and Industrial | |||
Loans and Allowance for Credit Losses - Loans | |||
Non-accrual | 71 | ||
Loans and Leases Receivable, Gross | 5,924 | 6,158 | |
SBA Guaranty | Commercial and Industrial | Pass | |||
Loans and Allowance for Credit Losses - Loans | |||
Loans and Leases Receivable, Gross | 5,924 | 6,158 | |
Consumer | Consumer Loans | |||
Loans and Allowance for Credit Losses - Loans | |||
Loans and Leases Receivable, Gross | 2,039 | 1,521 | |
Consumer | Consumer Loans | Pass | |||
Loans and Allowance for Credit Losses - Loans | |||
Loans and Leases Receivable, Gross | 2,039 | 1,521 | |
Automobile | Consumer Loans | |||
Loans and Allowance for Credit Losses - Loans | |||
Non-accrual | 83 | 85 | $ 144 |
Loans and Leases Receivable, Gross | 21,264 | 36,448 | |
Automobile | Consumer Loans | Pass | |||
Loans and Allowance for Credit Losses - Loans | |||
Loans and Leases Receivable, Gross | 21,110 | 36,363 | |
Automobile | Consumer Loans | Substandard | |||
Loans and Allowance for Credit Losses - Loans | |||
Loans and Leases Receivable, Gross | $ 154 | 80 | |
Automobile | Consumer Loans | Doubtful | |||
Loans and Allowance for Credit Losses - Loans | |||
Loans and Leases Receivable, Gross | $ 5 |
Loans and Allowance for Cred_10
Loans and Allowance for Credit Losses - Loans - Current, Past Due, and Non-Accrual Loans by Categories of loans and Restructured Loans (Details) - USD ($) | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 |
Loans and Allowance for Credit Losses - Loans | |||
Non-accrual | $ 527,000 | $ 488,000 | $ 338,000 |
Financing Receivable, 90 Days or More Past Due, Still Accruing | 0 | 10,000 | |
Total | 176,307,000 | 186,440,000 | |
Current | |||
Loans and Allowance for Credit Losses - Loans | |||
Total | 174,826,000 | 185,431,000 | |
30 To 89 Days Past Due | |||
Loans and Allowance for Credit Losses - Loans | |||
Total | 954,000 | 511,000 | |
90 Days or More and Still Accruing | |||
Loans and Allowance for Credit Losses - Loans | |||
Total | 10,000 | ||
Real Estate Loan | |||
Loans and Allowance for Credit Losses - Loans | |||
Non-accrual | 145,000 | 104,000 | |
Total | 136,230,000 | 133,323,000 | |
Real Estate Loan | Current | |||
Loans and Allowance for Credit Losses - Loans | |||
Total | 135,576,000 | 133,024,000 | |
Real Estate Loan | 30 To 89 Days Past Due | |||
Loans and Allowance for Credit Losses - Loans | |||
Total | 509,000 | 185,000 | |
Real Estate Loan | 90 Days or More and Still Accruing | |||
Loans and Allowance for Credit Losses - Loans | |||
Total | 10,000 | ||
Commercial and Industrial | |||
Loans and Allowance for Credit Losses - Loans | |||
Non-accrual | 299,000 | 299,000 | |
Total | 16,774,000 | 15,148,000 | |
Commercial and Industrial | Current | |||
Loans and Allowance for Credit Losses - Loans | |||
Total | 16,475,000 | 14,849,000 | |
Consumer Loans | |||
Loans and Allowance for Credit Losses - Loans | |||
Non-accrual | 83,000 | 85,000 | |
Total | 23,303,000 | 37,969,000 | |
Consumer Loans | Current | |||
Loans and Allowance for Credit Losses - Loans | |||
Total | 22,775,000 | 37,558,000 | |
Consumer Loans | 30 To 89 Days Past Due | |||
Loans and Allowance for Credit Losses - Loans | |||
Total | 445,000 | 326,000 | |
Construction and Land | Real Estate Loan | |||
Loans and Allowance for Credit Losses - Loans | |||
Total | 4,636,000 | 4,499,000 | |
Construction and Land | Real Estate Loan | Current | |||
Loans and Allowance for Credit Losses - Loans | |||
Total | 4,636,000 | 4,499,000 | |
Farmland | Real Estate Loan | |||
Loans and Allowance for Credit Losses - Loans | |||
Total | 325,000 | 333,000 | |
Farmland | Real Estate Loan | Current | |||
Loans and Allowance for Credit Losses - Loans | |||
Total | 325,000 | 333,000 | |
Single-family Residential | Real Estate Loan | |||
Loans and Allowance for Credit Losses - Loans | |||
Non-accrual | 145,000 | 104,000 | 123,000 |
Total | 86,887,000 | 80,251,000 | |
Single-family Residential | Real Estate Loan | Current | |||
Loans and Allowance for Credit Losses - Loans | |||
Total | 86,233,000 | 79,952,000 | |
Single-family Residential | Real Estate Loan | 30 To 89 Days Past Due | |||
Loans and Allowance for Credit Losses - Loans | |||
Total | 509,000 | 185,000 | |
Single-family Residential | Real Estate Loan | 90 Days or More and Still Accruing | |||
Loans and Allowance for Credit Losses - Loans | |||
Total | 10,000 | ||
Multi-family | Real Estate Loan | |||
Loans and Allowance for Credit Losses - Loans | |||
Total | 5,165,000 | 5,304,000 | |
Multi-family | Real Estate Loan | Current | |||
Loans and Allowance for Credit Losses - Loans | |||
Total | 5,165,000 | 5,304,000 | |
Commercial | Real Estate Loan | |||
Loans and Allowance for Credit Losses - Loans | |||
Total | 39,217,000 | 42,936,000 | |
Commercial | Real Estate Loan | Current | |||
Loans and Allowance for Credit Losses - Loans | |||
Total | 39,217,000 | 42,936,000 | |
Commercial | Commercial and Industrial | |||
Loans and Allowance for Credit Losses - Loans | |||
Total | 16,774,000 | 15,148,000 | |
Commercial and Industrial | Commercial and Industrial | |||
Loans and Allowance for Credit Losses - Loans | |||
Non-accrual | 299,000 | 299,000 | |
Total | 10,850,000 | 8,990,000 | |
Commercial and Industrial | Commercial and Industrial | Current | |||
Loans and Allowance for Credit Losses - Loans | |||
Total | 10,551,000 | 8,691,000 | |
SBA Guaranty | Commercial and Industrial | |||
Loans and Allowance for Credit Losses - Loans | |||
Non-accrual | 71,000 | ||
Total | 5,924,000 | 6,158,000 | |
SBA Guaranty | Commercial and Industrial | Current | |||
Loans and Allowance for Credit Losses - Loans | |||
Total | 5,924,000 | 6,158,000 | |
Consumer | Consumer Loans | |||
Loans and Allowance for Credit Losses - Loans | |||
Total | 2,039,000 | 1,521,000 | |
Consumer | Consumer Loans | Current | |||
Loans and Allowance for Credit Losses - Loans | |||
Total | 1,981,000 | 1,521,000 | |
Consumer | Consumer Loans | 30 To 89 Days Past Due | |||
Loans and Allowance for Credit Losses - Loans | |||
Total | 58,000 | ||
Automobile | Consumer Loans | |||
Loans and Allowance for Credit Losses - Loans | |||
Non-accrual | 83,000 | 85,000 | $ 144,000 |
Total | 21,264,000 | 36,448,000 | |
Automobile | Consumer Loans | Current | |||
Loans and Allowance for Credit Losses - Loans | |||
Total | 20,794,000 | 36,037,000 | |
Automobile | Consumer Loans | 30 To 89 Days Past Due | |||
Loans and Allowance for Credit Losses - Loans | |||
Total | $ 387,000 | $ 326,000 |
Loans and Allowance for Cred_11
Loans and Allowance for Credit Losses - Loans - Troubled debt restructured loans (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Financing Receivable, Impaired [Line Items] | ||
Troubled debt restructured loans | $ 30 | $ 34 |
Loans and Allowance for Cred_12
Loans and Allowance for Credit Losses - Loans - Impaired Financing Receivables (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Financing Receivable, Impaired [Line Items] | ||
Recorded Investment with specific reserves | $ 129 | $ 254 |
Unpaid Principal Balance with specific reserves | 329 | 333 |
Interest Income Recognized with specific reserves | 4 | 21 |
Specific Reserve with specific reserves | 200 | 79 |
Average Recorded Investment | 547 | 547 |
Recorded Investments with no specific reserve | 269 | 155 |
Unpaid Principal Balance with no specific reserves | 269 | 155 |
Interest Income Recognized with no specific reserve | 11 | 8 |
Average Recorded Investment with no specific reserve | 234 | 186 |
Real Estate Loan | ||
Financing Receivable, Impaired [Line Items] | ||
Recorded Investment with specific reserves | 9 | 14 |
Unpaid Principal Balance with specific reserves | 30 | 34 |
Interest Income Recognized with specific reserves | 4 | 2 |
Specific Reserve with specific reserves | 21 | 20 |
Average Recorded Investment | 48 | 48 |
Recorded Investments with no specific reserve | 115 | 70 |
Unpaid Principal Balance with no specific reserves | 115 | 70 |
Interest Income Recognized with no specific reserve | 5 | 2 |
Average Recorded Investment with no specific reserve | 130 | 79 |
Commercial and Industrial | ||
Financing Receivable, Impaired [Line Items] | ||
Recorded Investment with specific reserves | 120 | 240 |
Unpaid Principal Balance with specific reserves | 299 | 299 |
Interest Income Recognized with specific reserves | 19 | |
Specific Reserve with specific reserves | 179 | 59 |
Average Recorded Investment | 499 | 499 |
Consumer Loans | ||
Financing Receivable, Impaired [Line Items] | ||
Recorded Investments with no specific reserve | 154 | 85 |
Unpaid Principal Balance with no specific reserves | 154 | 85 |
Interest Income Recognized with no specific reserve | 6 | 6 |
Average Recorded Investment with no specific reserve | 104 | 107 |
Single-family Residential | Real Estate Loan | ||
Financing Receivable, Impaired [Line Items] | ||
Recorded Investment with specific reserves | 9 | 14 |
Unpaid Principal Balance with specific reserves | 30 | 34 |
Interest Income Recognized with specific reserves | 4 | 2 |
Specific Reserve with specific reserves | 21 | 20 |
Average Recorded Investment | 48 | 48 |
Recorded Investments with no specific reserve | 115 | 70 |
Unpaid Principal Balance with no specific reserves | 115 | 70 |
Interest Income Recognized with no specific reserve | 5 | 2 |
Average Recorded Investment with no specific reserve | 130 | 79 |
Commercial and Industrial | Commercial and Industrial | ||
Financing Receivable, Impaired [Line Items] | ||
Recorded Investment with specific reserves | 120 | 240 |
Unpaid Principal Balance with specific reserves | 299 | 299 |
Interest Income Recognized with specific reserves | 19 | |
Specific Reserve with specific reserves | 179 | 59 |
Average Recorded Investment | 499 | 499 |
Automobile | Consumer Loans | ||
Financing Receivable, Impaired [Line Items] | ||
Recorded Investments with no specific reserve | 154 | 85 |
Unpaid Principal Balance with no specific reserves | 154 | 85 |
Interest Income Recognized with no specific reserve | 6 | 6 |
Average Recorded Investment with no specific reserve | $ 104 | $ 107 |
Loans and Allowance for Cred_13
Loans and Allowance for Credit Losses - Loans (Details) | 12 Months Ended | ||
Dec. 31, 2023 USD ($) contract borrower | Dec. 31, 2022 USD ($) borrower | Dec. 31, 2021 USD ($) | |
Loans and Allowance for Credit Losses - Loans | |||
Amount of recorded investment in new troubled debt restructurings, totaled | $ 30,000 | $ 34,000 | |
Number of borrowers | borrower | 12 | 19 | |
Specific reserve amount | $ 201,000 | $ 80,000 | |
Non-accrual | 527,000 | 488,000 | $ 338,000 |
Financing Receivable, 90 Days or More Past Due, Still Accruing | 0 | 10,000 | |
Amount of interest that would have been accrued from non performing financial receivable, totaled | 15,000 | 29,000 | |
Consumer Loans | |||
Loans and Allowance for Credit Losses - Loans | |||
Non-accrual | 83,000 | 85,000 | |
Real Estate Loan | |||
Loans and Allowance for Credit Losses - Loans | |||
Non-accrual | 145,000 | 104,000 | |
Commercial and Industrial | |||
Loans and Allowance for Credit Losses - Loans | |||
Non-accrual | 299,000 | 299,000 | |
Consumer | |||
Loans and Allowance for Credit Losses - Loans | |||
Amount of consumer and indirect loans, outstanding | 30,038 | ||
Amount of consumer and indirect loans, specific reserves | $ 21,367 | ||
Number Of Loan Consumer And Indirect Loans | contract | 1 | ||
Single-family Residential | Real Estate Loan | |||
Loans and Allowance for Credit Losses - Loans | |||
Amount of recorded investment in new troubled debt restructurings, totaled | $ 30,000 | 34,000 | |
Non-accrual | 145,000 | 104,000 | $ 123,000 |
Commercial and Industrial | |||
Loans and Allowance for Credit Losses - Loans | |||
Amount of consumer and indirect loans, outstanding | 299,453 | ||
Amount of consumer and indirect loans, specific reserves | $ 179,453 | ||
Number Of Loan Consumer And Indirect Loans | contract | 1 | ||
Commercial and Industrial | Commercial and Industrial | |||
Loans and Allowance for Credit Losses - Loans | |||
Non-accrual | $ 299,000 | $ 299,000 |
Premises and Equipment - Summar
Premises and Equipment - Summary of Premises and Equipment (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Premises and Equipment | ||
Land | $ 685 | $ 685 |
Buildings | 6,823 | 6,781 |
Equipment and fixtures | 8,671 | 8,515 |
Construction in progress | 25 | 71 |
Operating Lease Assets | $ 210 | $ 366 |
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible Enumeration] | Premises and equipment, net | Premises and equipment, net |
Premises and equipment, gross | $ 16,414 | $ 16,418 |
Accumulated depreciation | (13,368) | (13,141) |
Premises and equipment, net | $ 3,046 | $ 3,277 |
Buildings | Minimum | ||
Premises and Equipment | ||
Useful lives | 30 years | 30 years |
Buildings | Maximum | ||
Premises and Equipment | ||
Useful lives | 40 years | 40 years |
Equipment and fixtures | Minimum | ||
Premises and Equipment | ||
Useful lives | 5 years | 5 years |
Equipment and fixtures | Maximum | ||
Premises and Equipment | ||
Useful lives | 7 years | 7 years |
Premises and Equipment (Details
Premises and Equipment (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Premises and Equipment | ||
Depreciation expense | $ 300,000 | $ 300,000 |
Amortization of software and intangible assets | 100,000 | 100,000 |
Minimum lease obligations through September 2024 | 193,000 | |
Minimum lease obligations through December 2024 | $ 9,000 | |
Operating Lease Income Comprehensive Income Extensible List Not Disclosed Flag | true | |
Rental income | $ 76,000 | 75,000 |
Rent expense | 198,000 | $ 188,000 |
Severna Park Branch | ||
Premises and Equipment | ||
Minimum lease obligations through September 2024 | 25,000 | |
Linthicum Branch | ||
Premises and Equipment | ||
Minimum lease obligations through December 2024 | $ 158,000 |
Premises and Equipment - Future
Premises and Equipment - Future Minimum Payment (Details) $ in Thousands | Dec. 31, 2023 USD ($) |
Premises and Equipment | |
2024 | $ 193 |
2025 | 11 |
2026 | 9 |
2027 | 6 |
Total | $ 219 |
Federal Home Loan Bank, Short_2
Federal Home Loan Bank, Short- and Long-term Borrowings (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Federal Home Loan Bank, Short- and Long-term Borrowings | ||
Federal home loan bank shares owned | 12,171 | |
Percentage of investment to be maintained on total assets | 0.07% | |
Amount of dollar cap on total assets | $ 18 | |
Additional percentage of investment to be maintained on total advances | 4.75% | |
Percentage of credit available on total assets | 25% | |
Amount of credit available on total assets | $ 88.8 | |
Short term debt average outstanding amount | $ 5.2 | $ 10.4 |
Short-term debt weighted average interest rate | 5.43% | 2.30% |
Long-term federal home loan bank advances | $ 0 | |
Federal home loan bank, advance, maturity, year one | $ 20 | 0 |
Average long-term borrowings | 0 | $ 6.2 |
Financial Bank One | ||
Federal Home Loan Bank, Short- and Long-term Borrowings | ||
Line of credit facility, maximum borrowing capacity | 9 | |
Financial Bank Two | ||
Federal Home Loan Bank, Short- and Long-term Borrowings | ||
Line of credit facility, maximum borrowing capacity | $ 8 |
Federal Home Loan Bank, Short_3
Federal Home Loan Bank, Short- and Long-term Borrowings - Derivatives (Details) | 3 Months Ended | 12 Months Ended | ||
Oct. 31, 2022 USD ($) | Dec. 31, 2022 USD ($) | Dec. 31, 2023 USD ($) item contract | Dec. 31, 2022 USD ($) | |
Federal Home Loan Bank, Short- and Long-term Borrowings | ||||
Number of interest rate swap designated as cash flow | item | 0 | |||
Gain on swap contract termination | $ 206,000 | $ 0 | $ 206,000 | |
Interest expense recorded on these swap transactions | $ 0 | $ 150,000 | ||
Interest Rate Swap On FHLB Advance | Interest Rate Contract | ||||
Federal Home Loan Bank, Short- and Long-term Borrowings | ||||
Number of derivative become effect in july and august 2018 | 2 | |||
Gain on swap contract termination | $ 206,000 | |||
Interest rate swap on FHLB advance maturing on October 2022 | ||||
Federal Home Loan Bank, Short- and Long-term Borrowings | ||||
Notional Amount | $ 10,000,000 |
Deposits - Summary of major cla
Deposits - Summary of major classifications of Interest-bearing deposits (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Deposits | ||
Noninterest-bearing deposits | $ 116,922 | $ 143,262 |
Interest-bearing checking | 28,571 | 40,086 |
Money Market | 26,836 | 15,791 |
Savings | 93,104 | 113,101 |
Time deposits, $100,000 or more | 12,501 | 19,999 |
Time deposits below $100,000 | 22,133 | 30,708 |
Total interest- bearing deposits | 183,145 | 219,685 |
Total Deposits | $ 300,067 | $ 362,947 |
Deposits - Summary of interest
Deposits - Summary of interest expense on deposits (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Deposits | ||
Interest-bearing checking | $ 10 | $ 11 |
Money Market | 76 | 12 |
Savings | 89 | 59 |
Time deposits, $100,000 or more | 162 | 183 |
Time deposits below $100,000 | 176 | 206 |
Total Interest Expense | $ 513 | $ 471 |
Deposits - Summary of maturitie
Deposits - Summary of maturities of time deposits (Details) $ in Thousands | Dec. 31, 2023 USD ($) |
Deposits | |
2024 | $ 22,577 |
2025 | 4,587 |
2026 | 3,514 |
2027 | 1,722 |
2028 | 1,995 |
2029 and thereafter | 239 |
Total Time Deposits | $ 34,634 |
Deposits (Details)
Deposits (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Deposits | ||
Fee income from deposits | $ 0.2 | $ 0.2 |
Deposit balances of executive officers and directors and their affiliated interests | 2.4 | 2.1 |
Brokered deposits | $ 0 | $ 0 |
Income Taxes - Summary of compo
Income Taxes - Summary of components of income tax expense (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Current income tax expense: | ||
Federal | $ 128 | $ 302 |
State | 28 | 148 |
Total current tax expense | 156 | 450 |
Deferred income tax expense: | ||
Federal | (59) | (147) |
State | (25) | (63) |
Total deferred tax expense | (84) | (210) |
Total income tax expense | $ 72 | $ 240 |
Income tax expense statutory rate | 21% | 21% |
Income Taxes - Reconciliation o
Income Taxes - Reconciliation of income tax expense computed at statutory rate (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Income Taxes | ||
Income tax expense at federal statutory rate | $ 315 | $ 417 |
(Decrease) increase resulting from: | ||
Tax-exempt income | (212) | (212) |
Bank owned life insurance | (34) | (33) |
State income taxes, net of Federal income tax benefit | 3 | 68 |
Total income tax expense | $ 72 | $ 240 |
Income Taxes - Components of ne
Income Taxes - Components of net deferred income tax benefits (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Deferred income tax expense: | ||
Accrued deferred compensation | $ 89 | $ 87 |
Allowance for credit losses | 480 | 386 |
Accumulated depreciation | (12) | (18) |
Accrued Liabilities | 110 | 144 |
Reserve for unfunded commitments | 130 | 131 |
Accounting standard 310-20 | (151) | (145) |
Right of use asset | (58) | (101) |
Lease liability | 58 | 101 |
Accumulated securities discount accretion | 272 | 248 |
Net unrealized depreciation on investment securities available for sale | 6,979 | 8,069 |
Net deferred income tax benefits | $ 7,897 | $ 8,902 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Income Taxes | ||
Income tax expense | $ 72 | $ 240 |
Pension and Profit Sharing Pl_2
Pension and Profit Sharing Plans (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Pension and Profit Sharing Plans | ||
Annual contributions included in employee benefit expense | $ 479,000 | $ 277,000 |
Other Benefit Plans (Details)
Other Benefit Plans (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Other Benefit Plans | ||
Cash value of life insurance contract | $ 8,700 | $ 8,500 |
Income on their insurance investment total | $ 164 | $ 156 |
Other Noninterest Expenses (Det
Other Noninterest Expenses (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Other Noninterest Expenses | ||
Loan related expenses | $ 164 | $ 145 |
Other ATM expenses | 34 | 41 |
Directors and other fees | 277 | 266 |
Postage, delivery and courier expenses | 83 | 81 |
Office supplies expenses | 44 | 38 |
Credit report fees | 21 | 24 |
Dues and subscription fees | 94 | 112 |
Examination and assessment fees | 47 | 51 |
Federal Reserve and correspondent bank services | 28 | 27 |
Liability insurance | 124 | 109 |
(Release) provision for unfunded commitments | (4) | 107 |
Card services | 111 | 114 |
NASDAQ registration | 50 | 61 |
Investor services | 23 | 41 |
Other | 107 | 86 |
Total Other Noninterest Expense | $ 1,203 | $ 1,303 |
Commitments and Contingencies -
Commitments and Contingencies - Summary of outstanding loan commitments, unused lines of credit and letters of credit (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Commitments and Contingencies | ||
Fair value disclosure, off-balance sheet risks, face amount, liability | $ 24,210 | $ 21,438 |
Other mortgage loans | ||
Commitments and Contingencies | ||
Fair value disclosure, off-balance sheet risks, face amount, liability | 8,952 | 9,280 |
Home-equity lines | ||
Commitments and Contingencies | ||
Fair value disclosure, off-balance sheet risks, face amount, liability | 10,817 | 10,142 |
Commercial lines | ||
Commitments and Contingencies | ||
Fair value disclosure, off-balance sheet risks, face amount, liability | 12,862 | 10,717 |
Unsecured consumer lines | ||
Commitments and Contingencies | ||
Fair value disclosure, off-balance sheet risks, face amount, liability | 532 | 579 |
Letters of credit | ||
Commitments and Contingencies | ||
Fair value disclosure, off-balance sheet risks, face amount, liability | $ 45 | $ 45 |
Commitments and Contingencies_2
Commitments and Contingencies (Details) - USD ($) | Dec. 31, 2023 | Dec. 31, 2022 |
Commitments and Contingencies | ||
Provision for financial receivable unfunded credit losses | $ 473,000 | $ 477,000 |
Stockholders' Equity (Details)
Stockholders' Equity (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Mar. 19, 2024 | Dec. 31, 2023 | Dec. 31, 2022 | |
Stockholders' Equity | |||
Retained earnings from which dividends may not be paid without prior approval, total | $ 21.2 | $ 20.7 | |
Employee Stock Purchase Benefit Plans | |||
Stockholders' Equity | |||
Number of options issued or activity | 0 | ||
Employee eligibility period | 1 year | ||
Employees to buy stock under options granted | 85% | ||
Options are vested when granted and will expire no later than | 27 months | ||
Common stock, capital shares reserved for future issuance | 25,739 | ||
Dividend Reinvestment and Stock Purchase Plan | |||
Stockholders' Equity | |||
Employees to buy stock under options granted | 95% | ||
Shares of common stock purchased | 17,581 | 11,166 | |
Common stock, capital shares reserved for future issuance | 185,950 | ||
Stockholder Purchase Plan | |||
Stockholders' Equity | |||
Number of options issued or activity | 0 | ||
Options are vested when granted and will expire no later than | 3 months | ||
Common stock, capital shares reserved for future issuance | 183,348 |
Stockholders' Equity - Summary
Stockholders' Equity - Summary of capital comparison with minimum requirements (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 USD ($) | Dec. 31, 2022 USD ($) | Jan. 01, 2016 | |
Stockholders' Equity | |||
Annual increase in capital (to risk weighted assets) for capital adequacy purposes ratio | 0.625% | ||
Common Equity Tier I Capital (to Risk Weighted Assets) Actual Amount | $ 37,975 | $ 37,963 | |
Common Equity Tier I Capital (to Risk Weighted Assets) Actual Ratio | 17.37% | 16.45% | |
Common Equity Tier I Capital (to Risk Weighted Assets) For Capital Adequacy Purposes Actual Amount | $ 9,840 | $ 10,383 | |
Common Equity Tier I Capital (to Risk Weighted Assets) For Capital Adequacy Purposes Actual Ratio | 4.50% | 4.50% | |
Common Equity Tier I Capital (to Risk Weighted Assets) To Be Well Capitalized Under Prompt Corrective Action Provisions Actual Amount | $ 14,213 | $ 14,998 | |
Common Equity Tier I Capital (to Risk Weighted Assets) To Be Well Capitalized Under Prompt Corrective Action Provisions Actual Ratio | 6.50% | 6.50% | |
Total Capital (to Risk Weighted Assets) Actual Amount | $ 40,237 | $ 39,866 | |
Total Capital (to Risk Weighted Assets) Actual Ratio | 0.1840 | 0.1728 | |
Total Capital (to Risk Weighted Assets) For Capital Adequacy Purposes Amount | $ 17,493 | $ 18,459 | |
Total Capital (to Risk Weighted Assets) For Capital Adequacy Purposes Ratio | 0.0800 | 0.0800 | 0.625 |
Total Capital (to Risk Weighted Assets) To Be Well Capitalized Under Prompt Corrective Action Provisions Amount | $ 21,867 | $ 23,074 | |
Total Capital (to Risk Weighted Assets) To Be Well Capitalized Under Prompt Corrective Action Provisions Ratio | 0.1000 | 0.1000 | |
Tier I Capital (to Risk Weighted Assets) Actual Amount | $ 37,975 | $ 37,963 | |
Tier I Capital (to Risk Weighted Assets) Actual Ratio | 0.1737 | 0.1645 | |
Tier I Capital (to Risk Weighted Assets) For Capital Adequacy Purposes Amount | $ 13,120 | $ 13,845 | |
Tier I Capital (to Risk Weighted Assets) For Capital Adequacy Purposes Ratio | 0.0600 | 0.0600 | |
Tier I Capital (to Risk Weighted Assets) To Be Well Capitalized Under Prompt Corrective Action Provisions Amount | $ 17,493 | $ 18,459 | |
Tier I Capital (to Risk Weighted Assets) To Be Well Capitalized Under Prompt Corrective Action Provisions Ratio | 0.0800 | 0.0800 | |
Tier I Capital (to Average Assets) Actual Amount | $ 37,975 | $ 37,963 | |
Tier I Capital (to Average Assets) Actual Ratio | 0.1076 | 0.0953 | |
Tier I Capital (to Average Assets) For Capital Adequacy Purposes Amount | $ 14,113 | $ 15,938 | |
Tier I Capital (to Average Assets) For Capital Adequacy Purposes Ratio | 0.0400 | 0.0400 | |
Tier I Capital (to Average Assets) To Be Well Capitalized Under Prompt Corrective Action Provisions Amount | $ 17,641 | $ 19,922 | |
Tier I Capital (to Average Assets) To Be Well Capitalized Under Prompt Corrective Action Provisions Ratio | 0.0500 | 0.0500 | |
Minimum | |||
Stockholders' Equity | |||
Common Equity Tier I Capital (to Risk Weighted Assets) For Capital Adequacy Purposes Actual Ratio | 4.50% | ||
Tier I Capital (to Risk Weighted Assets) For Capital Adequacy Purposes Actual Ratio | 4% | ||
Total Capital (to Risk Weighted Assets) Actual Ratio | 0.080 | ||
Tier I Capital (to Average Assets) Actual Ratio | 0.040 | ||
Maximum | |||
Stockholders' Equity | |||
Tier I Capital (to Risk Weighted Assets) For Capital Adequacy Purposes Actual Ratio | 6% | ||
Total Capital (to Risk Weighted Assets) For Capital Adequacy Purposes Ratio | 0.025 |
Earnings Per Common Share (Deta
Earnings Per Common Share (Details) - USD ($) | 3 Months Ended | 12 Months Ended | ||||||||
Dec. 31, 2023 | Sep. 30, 2023 | Jun. 30, 2023 | Mar. 31, 2023 | Dec. 31, 2022 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2023 | Dec. 31, 2022 | |
Basic earnings per share: | ||||||||||
Net income | $ 167,000 | $ 552,000 | $ 275,000 | $ 435,000 | $ 830,000 | $ 375,000 | $ 309,000 | $ 231,000 | $ 1,429,094 | $ 1,745,182 |
Weighted average common shares outstanding (in shares) | 2,873,500 | 2,859,239 | ||||||||
Net income per share (basic) (in dollars per share) | $ 0.06 | $ 0.19 | $ 0.10 | $ 0.15 | $ 0.29 | $ 0.13 | $ 0.11 | $ 0.08 | $ 0.50 | $ 0.61 |
Options outstanding | 0 | 0 | 0 | 0 |
Fair Values of Financial Inst_3
Fair Values of Financial Instruments - Estimated fair values of the Company's financial instruments (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Financial assets: Carrying Amount | ||
Cash and due from banks | $ 1,940 | $ 2,035 |
Interest-bearing deposits in other financial institutions | 12,189 | 22,680 |
Federal funds sold | 1,112 | 5,377 |
Investment securities available for sale | 139,427 | 144,133 |
Investments in restricted stock | 1,217 | 221 |
Ground rents | 130 | 131 |
Loans, less allowance for credit losses | 174,150 | 184,278 |
Accrued interest receivable | 1,192 | 1,159 |
Cash value of life insurance | 8,657 | 8,493 |
Financial liabilities: Carrying Amount | ||
Deposits | 300,067 | 362,947 |
Short-term borrowings | 30,000 | |
Accrued interest payable | 366 | 9 |
Unrecognized financial instruments: Carrying Amount | ||
Commitments to extend credit | 33,162 | 30,718 |
Standby letters of credit | 45 | 45 |
Financial Assets: Fair Value | ||
Cash and due from banks | 1,940 | 2,035 |
Interest-bearing deposits in other financial institutions | 12,189 | 22,680 |
Federal funds sold | 1,112 | 5,377 |
Investment securities available for sale | 139,427 | 144,133 |
Investments in restricted stock | 1,217 | 221 |
Ground rents | 130 | 131 |
Loans, less allowance for credit losses | 161,802 | 177,254 |
Accrued interest receivable | 1,192 | 1,159 |
Cash value of life insurance | 8,657 | 8,493 |
Financial liabilities: Fair Value | ||
Deposits | 252,707 | 299,773 |
Short-term borrowings | 30,000 | |
Accrued interest payable | 366 | 9 |
Unrecognized financial instruments: Fair Value | ||
Commitments to extend credit | 33,162 | 30,718 |
Standby letters of credit | $ 45 | $ 45 |
Fair Values of Financial Inst_4
Fair Values of Financial Instruments - Fair value hierarchy of financial instruments (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Financial instruments - Assets: Carrying Amount | ||
Cash and cash equivalents | $ 15,241 | |
Loans receivable, net | 174,150 | $ 184,278 |
Cash value of life insurance | 8,657 | 8,493 |
Financial instruments - Liabilities: Carrying Amount | ||
Deposits | 300,067 | 362,947 |
Financial instruments - Assets: Fair Value | ||
Cash and cash equivalents | 15,241 | |
Loans receivable, net | 161,802 | 177,254 |
Cash value of life insurance | 8,657 | |
Financial instruments - Liabilities: Fair Value | ||
Deposits | 252,707 | $ 299,773 |
Fair Value | Level 1 | ||
Financial instruments - Assets: Fair Value | ||
Cash and cash equivalents | 15,241 | |
Financial instruments - Liabilities: Fair Value | ||
Deposits | 33,118 | |
Fair Value | Level 2 | ||
Financial instruments - Assets: Fair Value | ||
Cash value of life insurance | 8,657 | |
Financial instruments - Liabilities: Fair Value | ||
Deposits | 219,589 | |
Fair Value | Level 3 | ||
Financial instruments - Assets: Fair Value | ||
Loans receivable, net | $ 161,802 |
Fair Value Measurements - Summa
Fair Value Measurements - Summary of fair value measurements on recurring and non-recurring Basis (Details) - USD ($) | Dec. 31, 2023 | Dec. 31, 2022 |
Fair Value Measurements | ||
Securities available for sale | $ 139,427,000 | $ 144,133,000 |
Assets, fair value disclosure | 139,825,000 | 144,463,000 |
Specific reserve amount | 201,000 | 80,000 |
Level 1 | ||
Fair Value Measurements | ||
Assets, fair value disclosure | 7,476,000 | |
Level 2 | ||
Fair Value Measurements | ||
Assets, fair value disclosure | 131,951,000 | 144,133,000 |
Level 3 | ||
Fair Value Measurements | ||
Assets, fair value disclosure | 398,000 | 330,000 |
U.S. Treasury securities | ||
Fair Value Measurements | ||
Securities available for sale | 6,945,000 | 6,783,000 |
State and Municipal | ||
Fair Value Measurements | ||
Securities available for sale | 33,729,000 | 32,297,000 |
Mortgage-backed | ||
Fair Value Measurements | ||
Securities available for sale | 46,114,000 | 51,893,000 |
Corporate securities | ||
Fair Value Measurements | ||
Securities available for sale | 1,284,000 | 1,325,000 |
Recurring | U.S. Treasury securities | ||
Fair Value Measurements | ||
Securities available for sale | 6,945,000 | |
Recurring | U.S. Treasury securities | Level 1 | ||
Fair Value Measurements | ||
Securities available for sale | 6,945,000 | |
Recurring | State and Municipal | ||
Fair Value Measurements | ||
Securities available for sale | 33,729,000 | 6,783,000 |
Recurring | State and Municipal | Level 2 | ||
Fair Value Measurements | ||
Securities available for sale | 33,729,000 | 6,783,000 |
Recurring | Mortgage-backed | ||
Fair Value Measurements | ||
Securities available for sale | 97,469,000 | 32,297,000 |
Recurring | Mortgage-backed | Level 1 | ||
Fair Value Measurements | ||
Securities available for sale | 531,000 | |
Recurring | Mortgage-backed | Level 2 | ||
Fair Value Measurements | ||
Securities available for sale | 96,938,000 | 32,297,000 |
Recurring | Corporate securities | ||
Fair Value Measurements | ||
Securities available for sale | 1,284,000 | 103,728,000 |
Recurring | Corporate securities | Level 2 | ||
Fair Value Measurements | ||
Securities available for sale | 1,284,000 | 103,728,000 |
Recurring | Interest rate swap | ||
Fair Value Measurements | ||
Securities available for sale | 1,325,000 | |
Recurring | Interest rate swap | Level 2 | ||
Fair Value Measurements | ||
Securities available for sale | 1,325,000 | |
Nonrecurring | ||
Fair Value Measurements | ||
Impaired loans | 398,000 | 330,000 |
Nonrecurring | Level 3 | ||
Fair Value Measurements | ||
Impaired loans | $ 398,000 | $ 330,000 |
Parent Company Financial Info_3
Parent Company Financial Information - Balance Sheets (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 |
Assets | |||
Cash and cash equivalents | $ 15,241 | ||
Other assets | 390 | $ 388 | |
Total assets | 351,813 | 381,436 | |
Stockholders' equity: | |||
Common stock | 2,883 | 2,865 | |
Surplus | 10,964 | 10,862 | |
Retained earnings | 23,859 | 23,579 | |
Accumulated other comprehensive loss, net of benefits | (18,381) | (21,252) | |
Total stockholders' equity | 19,325 | 16,054 | $ 35,716 |
Total liabilities and stockholders' equity | 351,813 | 381,436 | |
Glen Burnie Bancorp | |||
Assets | |||
Cash and cash equivalents | 88 | 77 | $ 99 |
Investment in The Bank of Glen Burnie | 19,227 | 15,975 | |
Other assets | 10 | 2 | |
Total assets | 19,325 | 16,054 | |
Stockholders' equity: | |||
Common stock | 2,883 | 2,865 | |
Surplus | 10,964 | 10,862 | |
Retained earnings | 23,859 | 23,579 | |
Accumulated other comprehensive loss, net of benefits | (18,381) | (21,252) | |
Total stockholders' equity | 19,325 | 16,054 | |
Total liabilities and stockholders' equity | $ 19,325 | $ 16,054 |
Parent Company Financial Info_4
Parent Company Financial Information - Statements of Income (Details) - USD ($) | 3 Months Ended | 12 Months Ended | ||||||||
Dec. 31, 2023 | Sep. 30, 2023 | Jun. 30, 2023 | Mar. 31, 2023 | Dec. 31, 2022 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2023 | Dec. 31, 2022 | |
Statements of Income | ||||||||||
Other expenses | $ (11,638,000) | $ (11,340,000) | ||||||||
Income before income tax benefit and equity in undistributed net income of subsidiary | $ 140,000 | $ 539,000 | $ 301,000 | $ 521,000 | $ 994,000 | $ 395,000 | $ 345,000 | $ 251,000 | 1,501,000 | 1,985,000 |
Income tax benefit | (72,000) | (240,000) | ||||||||
Net Income (Loss) | $ 167,000 | $ 552,000 | $ 275,000 | $ 435,000 | $ 830,000 | $ 375,000 | $ 309,000 | $ 231,000 | 1,429,094 | 1,745,182 |
Glen Burnie Bancorp | ||||||||||
Statements of Income | ||||||||||
Dividends and distributions from subsidiary | 1,210,000 | 1,210,000 | ||||||||
Other expenses | (205,000) | (243,000) | ||||||||
Income before income tax benefit and equity in undistributed net income of subsidiary | 1,005,000 | 967,000 | ||||||||
Income tax benefit | 43,000 | 39,000 | ||||||||
Change in undistributed equity of subsidiary | 381,000 | 739,000 | ||||||||
Net Income (Loss) | $ 1,429,000 | $ 1,745,000 |
Parent Company Financial Info_5
Parent Company Financial Information - Statements of Cash Flows (Details) - USD ($) | 3 Months Ended | 12 Months Ended | ||||||||
Dec. 31, 2023 | Sep. 30, 2023 | Jun. 30, 2023 | Mar. 31, 2023 | Dec. 31, 2022 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2023 | Dec. 31, 2022 | |
Cash flows from operating activities: | ||||||||||
Net income | $ 167,000 | $ 552,000 | $ 275,000 | $ 435,000 | $ 830,000 | $ 375,000 | $ 309,000 | $ 231,000 | $ 1,429,094 | $ 1,745,182 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||||
Increase in other assets | (106,000) | 215,000 | ||||||||
Net cash provided by operating activities | 1,399,000 | 2,225,000 | ||||||||
Cash flows from financing activities: | ||||||||||
Dividends paid | (1,149,000) | (1,143,000) | ||||||||
Net cash used in financing activities | (33,910,000) | (41,328,000) | ||||||||
Increase (decrease) in cash | (14,851,000) | (32,089,000) | ||||||||
Cash, end of year | 15,241,000 | 15,241,000 | ||||||||
Glen Burnie Bancorp | ||||||||||
Cash flows from operating activities: | ||||||||||
Net income | 1,429,000 | 1,745,000 | ||||||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||||
Increase in other assets | (8,000) | |||||||||
Change in undistributed equity of subsidiary | (381,000) | (739,000) | ||||||||
Net cash provided by operating activities | 1,040,000 | 1,006,000 | ||||||||
Cash flows from financing activities: | ||||||||||
Proceeds from dividend reinvestment plan | 120,000 | 115,000 | ||||||||
Dividends paid | (1,149,000) | (1,143,000) | ||||||||
Net cash used in financing activities | (1,029,000) | (1,028,000) | ||||||||
Increase (decrease) in cash | 11,000 | (22,000) | ||||||||
Cash, beginning of year | $ 77,000 | $ 99,000 | 77,000 | 99,000 | ||||||
Cash, end of year | $ 88,000 | $ 77,000 | $ 88,000 | $ 77,000 |
Quarterly Results of Operatio_3
Quarterly Results of Operations (Unaudited) (Details) - USD ($) | 3 Months Ended | 12 Months Ended | ||||||||
Dec. 31, 2023 | Sep. 30, 2023 | Jun. 30, 2023 | Mar. 31, 2023 | Dec. 31, 2022 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2023 | Dec. 31, 2022 | |
Quarterly Results of Operations (Unaudited) | ||||||||||
Interest income | $ 3,435,000 | $ 3,350,000 | $ 3,267,000 | $ 3,285,000 | $ 3,458,000 | $ 3,308,000 | $ 3,030,000 | $ 2,916,000 | $ 13,337,000 | $ 12,712,000 |
Interest expense | 544,000 | 398,000 | 153,000 | 107,000 | 120,000 | 271,000 | 228,000 | 234,000 | 1,202,000 | 853,000 |
Net interest income | 2,891,000 | 2,952,000 | 3,114,000 | 3,178,000 | 3,338,000 | 3,037,000 | 2,802,000 | 2,682,000 | 12,135,000 | 11,859,000 |
Provision for credit losses | 103,000 | (92,000) | 127,000 | (42,000) | 66,000 | 39,000 | (117,000) | (100,000) | 96,000 | (112,000) |
Net securities gains | 2,000 | 2,000 | ||||||||
Gain on swap contract termination | 206,000 | 0 | 206,000 | |||||||
Income before income taxes | 140,000 | 539,000 | 301,000 | 521,000 | 994,000 | 395,000 | 345,000 | 251,000 | 1,501,000 | 1,985,000 |
Net income | $ 167,000 | $ 552,000 | $ 275,000 | $ 435,000 | $ 830,000 | $ 375,000 | $ 309,000 | $ 231,000 | $ 1,429,094 | $ 1,745,182 |
Net income per share (basic) (in dollars per share) | $ 0.06 | $ 0.19 | $ 0.10 | $ 0.15 | $ 0.29 | $ 0.13 | $ 0.11 | $ 0.08 | $ 0.50 | $ 0.61 |
Net income per share (diluted) (in dollars per share) | $ 0.06 | $ 0.19 | $ 0.10 | $ 0.15 | $ 0.29 | $ 0.13 | $ 0.11 | $ 0.08 | $ 0.50 | $ 0.61 |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) | 3 Months Ended | 12 Months Ended | ||||||||
Dec. 31, 2023 | Sep. 30, 2023 | Jun. 30, 2023 | Mar. 31, 2023 | Dec. 31, 2022 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2023 | Dec. 31, 2022 | |
Pay vs Performance Disclosure | ||||||||||
Net Income (Loss) | $ 167,000 | $ 552,000 | $ 275,000 | $ 435,000 | $ 830,000 | $ 375,000 | $ 309,000 | $ 231,000 | $ 1,429,094 | $ 1,745,182 |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended |
Dec. 31, 2023 | |
Trading Arrangements, by Individual | |
Rule 10b5-1 Arrangement Adopted | false |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |