Quarterly report pursuant to Section 13 or 15(d)

LOANS (Tables)

v3.21.2
LOANS (Tables)
9 Months Ended
Sep. 30, 2021
LOANS [Abstract]  
Portfolio Loans

Portfolio loans were as follows (dollars in thousands):


   
September 30,
2021
   
December 31,
2020
 
Commercial and industrial:
           
Commercial and industrial, excluding PPP
 
$
356,812
   
$
436,331
 
PPP
   
77,571
     
229,079
 
Total commercial and industrial
   
434,383
     
665,410
 
Commercial real estate:
               
Residential developed
   
6,184
     
8,549
 
Unsecured to residential developers
   
19
     
 
Vacant and unimproved
   
36,616
     
47,122
 
Commercial development
   
403
     
857
 
Residential improved
   
100,608
     
114,392
 
Commercial improved
   
267,910
     
266,006
 
Manufacturing and industrial
   
115,470
     
115,247
 
Total commercial real estate
   
527,210
     
552,173
 
Consumer:
               
Residential mortgage
   
119,106
     
149,556
 
Unsecured
   
103
     
161
 
Home equity
   
52,127
     
57,975
 
Other secured
   
3,684
     
4,056
 
Total consumer
   
175,020
     
211,748
 
Total loans
   
1,136,613
     
1,429,331
 
Allowance for loan losses
   
(16,532
)
   
(17,408
)
   
$
1,120,081
   
$
1,411,923
 
Activity in Allowance for Loan Losses by Portfolio Segment
Activity in the allowance for loan losses by portfolio segment was as follows (dollars in thousands):


Three months ended September 30, 2021
 
Commercial
and
Industrial
   
Commercial
Real Estate
   
Consumer
   
Unallocated
   
Total
 
Beginning balance
 
$
5,206
   
$
8,740
   
$
2,856
   
$
4
   
$
16,806
 
Charge-offs
   
     
     
(22
)
   
     
(22
)
Recoveries
   
265
     
11
     
22
     
     
298
 
Provision for loan losses
   
(259
)
   
(250
)
   
(68
)
   
27
     
(550
)
Ending Balance
 
$
5,212
   
$
8,501
   
$
2,788
   
$
31
   
$
16,532
 


Three months ended September 30, 2020
 
Commercial
and
Industrial
   
Commercial
Real Estate
   
Consumer
   
Unallocated
   
Total
 
Beginning balance
 
$
5,431
   
$
7,262
   
$
3,138
   
$
24
   
$
15,855
 
Charge-offs
   
   
   
(24
)
   
     
(24
)
Recoveries
   
22
     
168
     
37
     
     
227
 
Provision for loan losses
   
513
   
237
     
(242
)
   
(8
)
   
500
 
Ending Balance
 
$
5,966
   
$
7,667
   
$
2,909
   
$
16
   
$
16,558
 


Nine months ended September 30, 2021
 
Commercial
and
Industrial
   
Commercial
Real Estate
   
Consumer
   
Unallocated
   
Total
 
Beginning balance
 
$
6,632
   
$
7,999
   
$
2,758
   
$
19
   
$
17,408
 
Charge-offs
   
     
     
(102
)
   
     
(102
)
Recoveries
   
320
     
122
     
84
     
     
526
 
Provision for loan losses
   
(1,740
)
   
380
     
48
     
12
   
(1,300
)
Ending Balance
 
$
5,212
   
$
8,501
   
$
2,788
   
$
31
   
$
16,532
 


Nine months ended September 30, 2020
 
Commercial
and
Industrial
   
Commercial
Real Estate
   
Consumer
   
Unallocated
   
Total
 
Beginning balance
 
$
7,658
   
$
6,521
   
$
3,009
   
$
12
   
$
17,200
 
Charge-offs
   
(1,192
)
   
(2,957
)
   
(97
)
   
     
(4,246
)
Recoveries
   
124
     
1,159
     
121
     
     
1,404
 
Provision for loan losses
   
(624
)
   
2,944
     
(124
)
   
4
     
2,200
 
Ending Balance
 
$
5,966
   
$
7,667
   
$
2,909
   
$
16
   
$
16,558
 
Allowance for Loan Losses and Recorded Investment in Loans by Portfolio Segment Based on Impairment Method
The following table presents the balance in the allowance for loan losses and the recorded investment in loans by portfolio segment and based on impairment method (dollars in thousands):


September 30, 2021
 
Commercial
and
Industrial
   
Commercial
Real Estate
   
Consumer
   
Unallocated
   
Total
 
Allowance for loan losses:
                             
Ending allowance attributable to loans:
                             
Individually reviewed for impairment
 
$
303
   
$
10
   
$
261
   
$
   
$
574
 
Collectively evaluated for impairment
   
4,909
     
8,491
     
2,527
     
31
     
15,958
 
Total ending allowance balance
 
$
5,212
   
$
8,501
   
$
2,788
   
$
31
   
$
16,532
 
Loans:
                                       
Individually reviewed for impairment
 
$
969
   
$
1,165
   
$
3,296
   
$
   
$
5,430
 
Collectively evaluated for impairment
   
433,414
     
526,045
     
171,724
     
     
1,131,183
 
Total ending loans balance
 
$
434,383
   
$
527,210
   
$
175,020
   
$
   
$
1,136,613
 


December 31, 2020
 
Commercial
and
Industrial
   
Commercial
Real Estate
   
Consumer
   
Unallocated
   
Total
 
Allowance for loan losses:
                             
Ending allowance attributable to loans:
                             
Individually reviewed for impairment
 
$
587
   
$
313
   
$
310
   
$
   
$
1,210
 
Collectively evaluated for impairment
   
6,045
     
7,686
     
2,448
     
19
     
16,198
 
Total ending allowance balance
 
$
6,632
   
$
7,999
   
$
2,758
   
$
19
   
$
17,408
 
Loans:
                                       
Individually reviewed for impairment
 
$
3,957
   
$
2,613
   
$
4,049
   
$
   
$
10,619
 
Collectively evaluated for impairment
   
661,453
     
549,560
     
207,699
     
     
1,418,712
 
Total ending loans balance
 
$
665,410
   
$
552,173
   
$
211,748
   
$
   
$
1,429,331
 
Loans Individually Evaluated for Impairment by Class of Loans
The following table presents loans individually evaluated for impairment by class of loans as of September 30, 2021 (dollars in thousands):


September 30, 2021
 
Unpaid
Principal
Balance
   
Recorded
Investment
   
Allowance
Allocated
 
With no related allowance recorded:
                 
Commercial and industrial
 
$
72
   
$
72
   
$
 
Commercial real estate:
                       
Residential improved
   
42
     
42
     
 
Commercial improved
   
929
     
929
     
 
     
971
     
971
     
 
Consumer
   
     
     
 
Total with no related allowance recorded
 
$
1,043
   
$
1,043
   
$
 
                         
With an allowance recorded:
                       
Commercial and industrial
 
$
897
   
$
897
   
$
303
 
Commercial real estate:
                       
Commercial improved
   
     
     
 
Manufacturing and industrial
   
194
     
194
     
10
 
     
194
     
194
     
10
 
Consumer:
                       
Residential mortgage
   
2,944
     
2,944
     
233
 
Unsecured
   
84
     
84
     
7
 
Home equity
   
267
     
267
     
21
 
Other secured
   
1
     
1
     
 
     
3,296
     
3,296
     
261
 
Total with an allowance recorded
 
$
4,387
   
$
4,387
   
$
574
 
Total
 
$
5,430
   
$
5,430
   
$
574
 


NOTE 3 – LOANS (Continued)


The following table presents loans individually evaluated for impairment by class of loans as of December 31, 2020 (dollars in thousands):


December 31, 2020
 
Unpaid
Principal
Balance
   
Recorded
Investment
   
Allowance
Allocated
 
With no related allowance recorded:
                 
Commercial and industrial
 
$
156
   
$
156
   
$
 
Commercial real estate:
                       
Residential improved
   
107
     
107
     
 
Commercial improved
   
714
     
714
     
 
     
821
     
821
     
 
Consumer
   
     
     
 
Total with no related allowance recorded
 
$
977
   
$
977
   
$
 
                         
With an allowance recorded:
                       
Commercial and industrial
 
$
3,801
   
$
3,801
   
$
587
 
Commercial real estate:
                       
Residential developed
   
67
     
67
     
3
 
Commercial improved
   
1,524
     
1,524
     
301
 
Manufacturing and industrial
   
201
     
201
     
9
 
     
1,792
     
1,792
     
313
 
Consumer:
                       
Residential mortgage
   
3,484
     
3,484
     
266
 
Unsecured
   
123
     
123
     
10
 
Home equity
   
419
     
419
     
32
 
Other secured
   
23
     
23
     
2
 
     
4,049
     
4,049
     
310
 
Total with an allowance recorded
 
$
9,642
   
$
9,642
   
$
1,210
 
Total
 
$
10,619
   
$
10,619
   
$
1,210
 


Average Balances of Impaired Loans and Interest Recognized on Impaired Loans
The following table presents information regarding average balances of impaired loans and interest recognized on impaired loans for the three and nine month periods ended September 30, 2021 and 2020 (dollars in thousands):


   
Three
Months
Ended
September 30,
2021
   
Three
Months
Ended
September 30,
2020
   
Nine
Months
Ended
September 30,
2021
   
Nine
Months
Ended
September 30,
2020
 
Average of impaired loans during the period:
                       
Commercial and industrial
 
$
749
   
$
2,208
   
$
2,417
   
$
4,362
 
Commercial real estate:
                               
Residential developed
   
     
71
     
15
     
72
 
Residential improved
   
18
     
168
     
46
     
211
 
Commercial improved
   
1,349
     
1,650
     
1,909
     
4,652
 
Manufacturing and industrial
   
195
     
347
     
197
     
352
 
Consumer
   
3,362
     
4,441
     
3,641
     
4,687
 
Interest income recognized during impairment:
                               
Commercial and industrial
   
40
     
23
     
336
     
303
 
Commercial real estate
   
22
     
33
     
88
     
193
 
Consumer
   
28
     
41
     
97
     
153
 
Cash-basis interest income recognized
                               
Commercial and industrial
   
37
     
13
     
356
     
298
 
Commercial real estate
   
22
     
33
     
88
     
218
 
Consumer
   
30
     
43
     
98
     
148
 
Recorded Investment in Nonaccrual and Loans Past Due Over 90 Days Still on Accrual by Class of Loans
Nonaccrual loans include both smaller balance homogeneous loans that are collectively evaluated for impairment and individually classified impaired loans.  The following tables present the recorded investment in nonaccrual and loans past due over 90 days still on accrual by class of loans as of September 30, 2021 and December 31, 2020:


September 30, 2021
 
Nonaccrual
   
Over 90
days
Accruing
 
Commercial and industrial
 
$
   
$
 
Commercial real estate:
               
Residential improved
   
5
     
 
Commercial improved
   
327
     
 
     
332
     
 
Consumer:
               
Residential mortgage
   
88
     
 
     
88
     
 
Total
 
$
420
   
$
 


December 31, 2020
 
Nonaccrual
   
Over 90 days
Accruing
 
Commercial and industrial
 
$
   
$
 
Commercial real estate:
               
Residential improved
   
87
     
 
Commercial improved
   
351
     
 
     
438
     
 
Consumer:
               
Residential mortgage
   
95
     
 
     
95
     
 
Total
 
$
533
   
$
 
Aging of Recorded Investment in Past Due Loans by Class of Loans
The following table presents the aging of the recorded investment in past due loans as of September 30, 2021 and December 31, 2020 by class of loans (dollars in thousands):


September 30, 2021
 
30-90
Days
   
Greater Than
90 Days
   
Total
Past Due
   
Loans Not
Past Due
   
Total
 
Commercial and industrial
 
$
   
$
   
$
   
$
434,383
   
$
434,383
 
Commercial real estate:
                                       
Residential developed
   
     
     
     
6,184
     
6,184
 
Unsecured to residential developers
   
     
     
     
19
     
19
 
Vacant and unimproved
   
     
     
     
36,616
     
36,616
 
Commercial development
   
     
     
     
403
     
403
 
Residential improved
   
     
5
     
5
     
100,603
     
100,608
 
Commercial improved
   
344
     
     
344
     
267,566
     
267,910
 
Manufacturing and industrial
   
     
     
     
115,470
     
115,470
 
     
344
     
5
     
349
     
526,861
     
527,210
 
Consumer:
                                       
Residential mortgage
   
     
87
     
87
     
119,019
     
119,106
 
Unsecured
   
     
     
     
103
     
103
 
Home equity
   
     
     
     
52,127
     
52,127
 
Other secured
   
1
     
     
1
     
3,683
     
3,684
 
     
1
     
87
     
88
     
174,932
     
175,020
 
Total
 
$
345
   
$
92
   
$
437
   
$
1,136,176
   
$
1,136,613
 


December 31, 2020
 
30-90
Days
   
Greater Than
90 Days
   
Total
Past Due
   
Loans Not
Past Due
   
Total
 
Commercial and industrial
 
$
45
   
$
   
$
45
   
$
665,365
   
$
665,410
 
Commercial real estate:
                                       
Residential developed
   
     
     
     
8,549
     
8,549
 
Unsecured to residential developers
                             
Vacant and unimproved
   
     
     
     
47,122
     
47,122
 
Commercial development
   
     
     
     
857
     
857
 
Residential improved
   
     
87
     
87
     
114,305
     
114,392
 
Commercial improved
   
353
     
     
353
     
265,653
     
266,006
 
Manufacturing and industrial
   
     
     
     
115,247
     
115,247
 
     
353
     
87
     
440
     
551,733
     
552,173
 
Consumer:
                                       
Residential mortgage
   
     
94
     
94
     
149,462
     
149,556
 
Unsecured
   
     
     
     
161
     
161
 
Home equity
   
     
     
     
57,975
     
57,975
 
Other secured
   
2
     
     
2
     
4,054
     
4,056
 
     
2
     
94
     
96
     
211,652
     
211,748
 
Total
 
$
400
   
$
181
   
$
581
   
$
1,428,750
   
$
1,429,331
 
Troubled Debt Restructurings

The following table presents information regarding troubled debt restructurings as of September 30, 2021 and December 31, 2020 (dollars in thousands):


   
September 30, 2021
   
December 31, 2020
 
   
Number of
Loans
   
Outstanding
Recorded
Balance
   
Number of
Loans
   
Outstanding
Recorded
Balance
 
Commercial and industrial
   
5
   
$
969
     
7
   
$
3,957
 
Commercial real estate
   
6
     
1,165
     
9
     
1,439
 
Consumer
   
48
     
3,296
     
60
     
4,049
 
     
59
   
$
5,430
     
76
   
$
9,445
 


NOTE 3 – LOANS (Continued)


The following table presents information related to accruing TDRs as of September 30, 2021 and December 31, 2020.  The table presents the amount of accruing troubled debt restructurings that were on nonaccrual status prior to the restructuring, accruing at the time of restructuring and those that were upgraded to accruing status after receiving six consecutive monthly payments in accordance with the restructured terms as of each period reported (dollars in thousands):


   
September 30,
2021
   
December 31,
2020
 
Accruing TDR - nonaccrual at restructuring
 
$
   
$
 
Accruing TDR - accruing at restructuring
   
4,554
     
5,479
 
Accruing TDR - upgraded to accruing after six consecutive payments
   
544
     
3,529
 
   
$
5,098
   
$
9,008
 
Risk Grade Category of Loans by Class of Loans
As of September 30, 2021 and December 31, 2020, the risk grade category of commercial loans by class of loans were as follows (dollars in thousands):


September 30, 2021
  1
    2
    3
    4
    5
    6
    7
    8
   
Total
 
Commercial and industrial
 
$
92,615
   
$
13,376
   
$
94,433
   
$
230,163
   
$
2,862
   
$
934
   
$
   
$
   
$
434,383
 
                                                                         
Commercial real estate:
                                                                       
Residential developed
   
     
     
     
6,184
     
     
     
     
     
6,184
 
Unsecured to residential developers
   
     
     
19
     
     
     
     
     
     
19
 
Vacant and unimproved
   
     
1,791
     
9,028
     
25,797
     
     
     
     
     
36,616
 
Commercial development
   
     
     
220
     
183
     
     
     
     
     
403
 
Residential improved
   
     
     
22,774
     
77,705
     
124
     
     
5
     
     
100,608
 
Commercial improved
   
     
13,713
     
64,208
     
182,085
     
7,577
     
     
327
     
     
267,910
 
Manufacturing & industrial
   
     
3,563
     
42,672
     
66,440
     
2,795
     
     
     
     
115,470
 
   
$
92,615
   
$
32,443
   
$
233,354
   
$
588,557
   
$
13,358
   
$
934
   
$
332
   
$
   
$
961,593
 


December 31, 2020
  1
    2
    3     4
    5
    6
    7
    8
   
Total
 
Commercial and industrial
 
$
244,079
   
$
14,896
   
$
111,611
   
$
276,728
   
$
13,957
   
$
4,139
   
$
   
$
   
$
665,410
 
                                                                         
Commercial real estate:
                                                                       
Residential developed
   
     
     
     
8,549
     
     
     
     
     
8,549
 
Vacant and unimproved
   
     
3,473
     
9,427
     
32,751
     
1,471
     
     
     
     
47,122
 
Commercial development
   
     
     
302
     
555
     
     
     
     
     
857
 
Residential improved
   
     
     
23,706
     
90,372
     
227
     
     
87
     
     
114,392
 
Commercial improved
   
     
6,328
     
58,483
     
192,030
     
7,641
     
1,174
     
350
     
     
266,006
 
Manufacturing & industrial
   
     
     
31,451
     
80,075
     
3,721
     
     
     
     
115,247
 
   
$
244,079
   
$
24,697
   
$
234,980
   
$
681,060
   
$
27,017
   
$
5,313
   
$
437
   
$
   
$
1,217,583
 
Commercial Loans Classified as Substandard or Worse

Commercial loans rated a 6 or worse per the Company’s internal risk rating system are considered substandard, doubtful or loss. Commercial loans classified as substandard or worse were as follows at period-end (dollars in thousands):


   
September 30,
2021
   
December 31,
2020
 
Not classified as impaired
 
$
263
   
$
591
 
Classified as impaired
   
1,003
     
5,159
 
Total commercial loans classified substandard or worse
 
$
1,266
   
$
5,750
 
Recorded Investment in Consumer Loans Based on Payment Activity

The Company considers the performance of the loan portfolio and its impact on the allowance for loan losses. For consumer loan classes, the Company also evaluates credit quality based on the aging status of the loan, which was previously presented, and by payment activity. The following table presents the recorded investment in consumer loans based on payment activity (dollars in thousands):


September 30, 2021
 
Residential
Mortgage
   
Consumer
Unsecured
   
Home
Equity
   
Consumer
Other
 
Performing
 
$
119,018
   
$
103
   
$
52,127
   
$
3,684
 
Nonperforming
   
88
     
     
     
 
Total
 
$
119,106
   
$
103
   
$
52,127
   
$
3,684
 


December 31, 2020
 
Residential
Mortgage
   
Consumer
Unsecured
   
Home
Equity
   
Consumer
Other
 
Performing
 
$
149,461
   
$
161
   
$
57,975
   
$
4,056
 
Nonperforming
   
95