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Portfolio Loans Receivable (Tables)
 6 Months Ended
Jun. 30, 2022
Receivables [Abstract]  
Schedule of Loans Receivable
Major classifications of portfolio loans as are as follows:
Portfolio Loan Categories
(in thousands)June 30, 2022December 31, 2021
Real estate:
Residential$430,244 $401,607 
Commercial608,646 556,339 
Construction241,249 255,147 
Commercial and Industrial193,262 175,956 
Credit card142,166 141,120 
Other consumer856 1,033 
Portfolio loans receivable, gross1,616,423 1,531,202 
Deferred origination fees, net(8,746)(7,220)
Allowance for loan losses(26,419)(25,181)
Portfolio loans receivable, net$1,581,258 $1,498,801 
Schedule of Activity In Accretable Discounts On Loans Acquired
Accretable discounts on loans acquired is summarized as follows:
Accretable Discounts on Loans Acquired
(in thousands)For the Three Months Ended
For the Six Months Ended
June 30, 2022June 30, 2021June 30, 2022June 30, 2021
Accretable discount at beginning of period$164 $218 $166 $221 
  Less: Accretion and payoff of loans(5)(6)(7)(9)
Accretable discount at end of period$159 $212 $159 $212 
Allowance for Credit Losses on Loans Receivables
The following tables set forth the changes in the allowance for loan losses and an allocation of the allowance for loan losses by class for the three and six months ended June 30, 2022 and June 30, 2021.
Allowance for Loan LossesBeginning
Balance		Provision for
Loan Losses		Charge-OffsRecoveriesEnding
Balance
(in thousands)
Three Months Ended June 30, 2022
Real estate:
Residential$5,832 $31 $— $— $5,863 
Commercial8,718 139 — — 8,857 
Construction4,607 (134)— — 4,473 
Commercial and Industrial2,350 107 — — 2,457 
Credit card3,735 1,892 (880)12 4,759 
Other consumer10 — — — 10 
Total$25,252 $2,035 $(880)$12 $26,419 
Six Months Ended June 30, 2022
Real estate:
Residential$5,612 $251 $— $— $5,863 
Commercial8,566 291 — — 8,857 
Construction4,699 (226)— — 4,473 
Commercial and Industrial2,637 (180)— — 2,457 
Credit card3,655 2,853 (1,779)30 4,759 
Other consumer12 (2)— — 10 
Total$25,181 $2,987 $(1,779)$30 $26,419 
Allowance for Loan Losses
Beginning
Balance		Provision for
Loan Losses		Charge-OffsRecoveriesEnding
Balance
Three Months Ended June 30, 2021
Real estate:
Residential$6,816 $(107)$— $— $6,709 
Commercial7,362 415 — — 7,777 
Construction4,644 (102)— 1 4,543 
Commercial and Industrial2,449 176 (95)5 2,535 
Credit card2,232 432 (172)10 2,502 
Other consumer47 (34)— — 13 
Total$23,550 $781 $(267)$16 $24,079 
Six Months Ended June 30, 2021
Real estate:
Residential$7,153 $(444)$— $— $6,709 
Commercial6,786 991 — — 7,777 
Construction4,595 (53)— 1 4,543 
Commercial and Industrial2,417 313 (200)5 2,535 
Credit card2,462 485 (472)27 2,502 
Other consumer21 (8)— — 13 
Total$23,434 $1,284 $(672)$33 $24,079 
As mentioned in Note 1, the allowance for loan losses is estimated to adequately provide for probable future losses on existing loans. A major consideration in the determination of the allowance for loan loss on the credit card portfolio is based on historical loss experience in that portfolio and is calculated using both secured and unsecured loan balances.
The following tables present, by class and reserving methodology, the allocation of the allowance for loan losses and the gross investment in loans. The allowance for loan losses consists of specific and general components. The specific component relates to loans that are individually classified as impaired. The general component covers non-impaired loans and is based on historical loss experience adjusted for current economic factors.
Allowance for Loan Loss Composition
(in thousands)Allowance for Loan Losses
Ending Balance Evaluated
for Impairment:		Outstanding Portfolio
Loan Balances Evaluated
for Impairment:
June 30, 2022IndividuallyCollectivelyIndividuallyCollectively
Real estate:
Residential$— $5,863 $3,180 $427,064 
Commercial— 8,857 961 607,685 
Construction— 4,473 2,041 239,208 
Commercial and Industrial160 2,297 871 192,391 
Credit card— 4,759 — 142,166 
Other consumer— 10 — 856 
Total$160 $26,259 $7,053 $1,609,370 
December 31, 2021
Real estate:
Residential$— $5,612 $2,835 $398,772 
Commercial— 8,566 25 556,314 
Construction— 4,699 7,803 247,344 
Commercial and Industrial218 2,419 676 175,280 
Credit card— 3,655 — 141,120 
Other consumer— 12 — 1,033 
Total$218 $24,963 $11,339 $1,519,863 
Past Due Loans Receivables
Past due loans, segregated by age and class of loans, as of June 30, 2022 and December 31, 2021 were as follows:
Portfolio Loans Past Due
Loans
30-89 Days
Past Due		Loans
90 or More
Days
Past Due		Total Past
Due Loans		Current
Loans		Total
Portfolio
Loans		Accruing
Loans 90 or
More Days
Past Due		Non-accrual
Loans
(in thousands)
June 30, 2022
Real estate:
Residential$1,424 $2,878 $4,302 $425,942 $430,244 $— $3,180 
Commercial882 1,155 2,037 606,609 608,646 194 961 
Construction815 2,041 2,856 238,393 241,249 — 2,041 
Commercial and Industrial352 575 927 192,335 193,262 — 871 
Credit card16,586 90 16,676 125,490 142,166 90 — 
Other consumer— — — 856 856 — — 
Total$20,059 $6,739 $26,798 $1,589,625 $1,616,423 $284 $7,053 
December 31, 2021
Real estate:
Residential$469 $2,494 $2,963 $398,644 $401,607 $72 $2,835 
Commercial367 25 392 555,947 556,339 — 25 
Construction— 7,803 7,803 247,344 255,147 — 7,803 
Commercial and Industrial183 593 776 175,180 175,956 — 676 
Credit card19,022 10 19,032 122,088 141,120 10 — 
Other consumer— — — 1,033 1,033 — — 
Total$20,041 $10,925 $30,966 $1,500,236 $1,531,202 $82 $11,339 
Impaired Loans Receivables
Impaired portfolio loans were as follows:
Impaired Portfolio Loans
Unpaid
Contractual
Principal
Balance		Recorded
Investment
With No
Allowance		Recorded
Investment
With
Allowance		Total
Recorded
Investment		Related
Allowance
(in thousands)
June 30, 2022
Real estate:
Residential$3,337 $3,180 $— $3,180 $— 
Commercial1,029 961 — 961 — 
Construction2,123 2,041 — 2,041 — 
Commercial and Industrial1,041 516 355 871 160 
Total$7,530 $6,698 $355 $7,053 $160 
December 31, 2021
Real estate:
Residential$3,022 $2,835 $— $2,835 $— 
Commercial90 25 — 25 — 
Construction7,885 7,803 — 7,803 — 
Commercial and Industrial832 340 336 676 218 
Total$11,829 $11,003 $336 $11,339 $218 
The following tables summarize interest recognized on impaired loans:
Interest Recognized on Impaired Portfolio Loans
For the Three Months Ended June 30, 2022For the Six Months Ended June 30, 2022
(in thousands)Average
Recorded
Investment		Interest
Recognized		Average
Recorded
Investment		Interest
Recognized
Real estate:
Residential$3,342 $11 $3,344 $18 
Commercial1,030 2 1,031 4 
Construction2,123 — 2,123 — 
Commercial and Industrial 1,266 9 1,277 14 
Total$7,761 $22 $7,775 $36 
Interest Recognized on Impaired Portfolio Loans
For the Three Months Ended June 30, 2021For the Six Months Ended June 30, 2021
(in thousands)Average
Recorded
Investment		Interest
Recognized		Average
Recorded
Investment		Interest
Recognized
Real estate:
Residential$4,952 $15 $4,955 $21 
Commercial1,080 3 1,094 17 
Construction2,720 — 2,720 — 
Commercial and Industrial1,154 31 1,155 34 
Total$9,906 $49 $9,924 $72 
Loans Receivables Credit Quality Indicators
The following table presents the balances of classified loans based on the risk grade. Classified loans include Special Mention, Substandard, and Doubtful loans:
Portfolio Loan Classifications
(in thousands)
Pass(1)
Special MentionSubstandardDoubtfulTotal
June 30, 2022
Real estate:
Residential
$423,366 $1,733 $5,145 $— $430,244 
Commercial
601,627 6,058 961 — 608,646 
Construction
239,208 — 2,041 — 241,249 
Commercial and Industrial187,682 3,976 1,604 — 193,262 
Credit card142,166 — — — 142,166 
Other consumer856 — — — 856 
Portfolio loans receivable, gross$1,594,905 $11,767 $9,751 $— $1,616,423 
December 31, 2021
Real estate:
Residential
$394,488 $2,540 $4,579 $— $401,607 
Commercial
548,244 8,070 25 — 556,339 
Construction
243,848 3,496 7,803 — 255,147 
Commercial and Industrial164,066 10,417 1,473 — 175,956 
Credit card141,120 — — — 141,120 
Other consumer1,033 — — — 1,033 
Portfolio loans receivable, gross$1,492,799 $24,523 $13,880 $— $1,531,202 
________________________
(1)     Pass includes loans graded exceptional, very good, good, satisfactory and pass/watch, in addition to credit cards and consumer credits that are not individually graded.
Troubled Debt Restructurings on Loans Receivables
Modifications such as payment deferrals through June 30, 2022 have been short term in nature and are included in the population of loans deferred and have not impacted TDRs. The status of TDRs is as follows:
Troubled Debt Restructurings
(in thousands)Number of
Contracts		Recorded Investment
June 30, 2022PerformingNonperformingTotal
Real estate:
Residential4 $— $443 $443 
Commercial and Industrial1 — 76 76 
Total5 $— $519 $519 
December 31, 2021
Real estate:
Residential4 $— $450 $450 
Commercial and Industrial1 — 83 83 
Total5 $— $533 $533 
Schedule of Outstanding Loan Commitments
Outstanding loan commitments were as follows:
Loan Commitments
(in thousands)June 30, 2022December 31, 2021
Unused lines of credit
Real Estate:
Residential$18,255 $15,747 
Residential - Home Equity37,390 37,640 
Commercial30,879 17,225 
Construction100,974 118,518 
Commercial and Industrial48,919 45,135 
Credit card(1)
126,079 123,874 
Other consumer2,295 2,247 
Total$364,791 $360,386 
Commitments to originate residential loans held for sale$183 $1,385 
Letters of credit$5,085 $5,105 
________________________
(1)     Outstanding loan commitments in the credit card portfolio include $121.3 million and $121.7 million in secured balances as of June 30, 2022 and December 31, 2021, respectively.
Schedule of Credit Losses for Financing Receivables
The Company's maximum exposure to credit loss in the event of nonperformance by the customer is the contractual amount of the credit commitment. Loan commitments and lines of credit are generally made on the same terms, including collateral, as outstanding loans. Management is not aware of any accounting loss to be incurred by funding these loan commitments. The Company maintains an estimated reserve for off balance sheet items such as unfunded lines of credit, which is reflected in other liabilities, with increases or decreases in the reserve being charged to or released from operating expense. Activity for this account is as follows for the periods presented:
Off Balance Sheet Reserve
(in thousands)For the Three Months Ended
For the Six Months Ended
June 30, 2022June 30, 2021June 30, 2022June 30, 2021
Balance at beginning of period$1,586 $1,822 $1,736 $1,775 
Provision for (reversal of) off balance sheet credit commitments45 (77)(105)(30)
Balance at end of period$1,631 $1,745 $1,631 $1,745 
The Company makes representations and warranties that loans sold to investors meet their program's guidelines and that the information provided by the borrowers is accurate and complete. In the event of a default on a loan sold, the investor may have the right to make a claim for losses due to document deficiencies, program compliance, early payment default, and fraud or borrower misrepresentations.
The Company maintains an estimated reserve for potential losses on mortgage loans sold, which is reflected in other liabilities, with changes being charged to or released from operating expense. Activity in this reserve is as follows for the periods presented:
Mortgage Loan Put-back Reserve
(in thousands)For the Three Months Ended
For the Six Months Ended
June 30, 2022June 30, 2021June 30, 2022June 30, 2021
Balance at beginning of period$1,164 $1,284 $1,164 $1,160 
Provision for mortgage loan put backs2 86 2 210 
Balance at end of period$1,166 $1,370 $1,166 $1,370