Loans and Allowance for Credit Losses (Tables)

3 Months Ended

Mar. 31, 2023

Receivables [Abstract]

Schedule of corporation’s loan portfolio by category of loans

	March 31,
	2023
	$
Agriculture		240,006
Business Loans		353,537
Consumer		6,061
Home Equity		100,743
Non-Owner Occupied Commercial Real Estate		119,412
Residential Real Estate (a)		434,215
Gross loans prior to deferred costs		1,253,974
Deferred loan costs, net		2,625
Allowance for credit losses		(16,054	)
Total net loans (b)		1,240,545

(a) Real estate loans serviced for others, which are not included in the Consolidated Balance Sheets, totaled $295,917,000 as of March 31, 2023.

(b) Refer to Note 1, Accounting Pronouncements Adopted in 2023 for details of reclassification of the portfolio segments related to the adoption of ASU 2016-13 Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments.

Schedule of category of loans and impact of the change from the adoption of the standard

							Post Adoption
	December 31,			Adoption			January, 1
	2022			Impact			2023
	$			$			$
Agriculture		—			238,734			238,734
Business Loans		—			336,340			336,340
Home Equity		—			98,854			98,854
Non-Owner Occupied CRE		—			111,333			111,333
Residential Real Estate (a)		—			397,260			397,260
Commercial real estate
Commercial mortgages		210,823			(210,823	)		—
Agriculture mortgages		221,167			(221,167	)		—
Construction		86,793			(86,793	)		—
Total commercial real estate		518,783			(518,783	)		—
Consumer real estate (a)
1-4 family residential mortgages		410,301			(410,301	)		—
Home equity loans		11,937			(11,937	)		—
Home equity lines of credit		98,349			(98,349	)		—
Total consumer real estate		520,587			(520,587	)		—
Commercial and industrial
Commercial and industrial		87,528			(87,528	)		—
Tax-free loans		28,664			(28,664	)		—
Agriculture loans		27,122			(27,122	)		—
Total commercial and industrial		143,314			(143,314	)		—
Consumer		5,769			163			5,932
Gross loans prior to deferred fees		1,188,453			—			1,188,453
Deferred loan costs, net		2,664
Allowance for credit losses		(14,151	)
Total net loans		1,176,966

(a) Real estate loans serviced for others, which are not included in the Consolidated Balance Sheets, totaled $298,375,000 as of December 31, 2022.

Schedule of classes of the loan portfolio summarized by the past-due status

	March 31, 2023
			31-60		61-90		Greater Than
			Days		Days		90 Days		Total		Total
	Current		Past Due		Past Due		Past Due		Past Due		Loans
Agriculture	$	239,264	$	473	$	—	$	269	$	742	$	240,006
Business Loans		353,325		58		—		154		212		353,537
Consumer		5,994		31		1		35		67		6,061
Home Equity		100,566		154		23		—		177		100,743
Non-Owner Occupied CRE		119,412		—		—		—		—		119,412
Residential Real Estate		433,737		341		—		137		478		434,215
Total (a)	$	1,252,298	$	1,057	$	24	$	595	$	1,676	$	1,253,974

(a) Refer to Note 1, Accounting Pronouncements Adopted in 2023 for details of reclassification of the portfolio segments related to adoption of ASU 2016-13 Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments.

	December 31, 2022
													Loans
					Greater								Receivable >
	30-59 Days		60-89 Days		than 90		Total Past				Total Loans		90 Days and
	Past Due		Past Due		Days		Due		Current		Receivable		Accruing
	$		$		$		$		$		$		$
Commercial real estate
Commercial mortgages		—		—		554		554		210,269		210,823		—
Agriculture mortgages		—		—		2,787		2,787		218,380		221,167		—
Construction		—		—		—		—		86,793		86,793		—
Consumer real estate
1-4 family residential mortgages		905		—		447		1,352		408,949		410,301		139
Home equity loans		17		—		339		356		11,581		11,937		—
Home equity lines of credit		165		16		—		181		98,168		98,349		—
Commercial and industrial
Commercial and industrial		—		—		190		190		87,338		87,528		—
Tax-free loans		—		—		—		—		28,664		28,664		—
Agriculture loans		—		—		—		—		27,122		27,122		—
Consumer		9		5		30		44		5,725		5,769		30
Total		1,096		21		4,347		5,464		1,182,989		1,188,453		169

Schedule of amortized cost basis of loans on nonaccrual status and loans past due

	Nonaccrual		Nonaccrual				Loans Past
	with no		with		Total		Due Over 90 Days		Total
	ACL		ACL		Nonaccrual		Still Accruing		Nonperforming
Agriculture	$	1,005	$	—	$	1,005	$	269	$	1,274
Business Loans		2,509		—		2,509		—		2,509
Consumer Loans		—		—		—		35		35
Home Equity		—		—		—		—		—
Non-Owner Occupied CRE		—		—		—		—		—
Residential Real Esate		—		—		—		137		137
Total (a)	$	3,514	$	—	$	3,514	$	441	$	3,955

(a) Refer to Note 1, Accounting Pronouncements Adopted in 2023 for details of reclassification of the portfolio segments related to adoption of ASU 2016-13 Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments.

Schedule of nonperforming loans

	December 31,
	2022
	$
Commercial real estate
Commercial mortgages		554
Agriculture mortgages		2,787
Construction		—
Consumer real estate
1-4 family residential mortgages		308
Home equity loans		339
Home equity lines of credit		—
Commercial and industrial
Commercial and industrial		190
Tax-free loans		—
Agriculture loans		—
Consumer		—
Total		4,178

Schedule of recorded investment by internal risk rating system for commercial credit exposure

													Revolving		Revolving
	Term Loans Amortized Costs Basis by Origination Year												Loans		Loans
													Amortized		Converted
March 31, 2023	2023		2022		2021		2020		2019		Prior		Cost Basis		to Term		Total
Agriculture
Risk Rating
Pass	$	9,568	$	45,812	$	52,338	$	21,590	$	16,144	$	65,217	$	23,566	$	—	$	234,235
Special Mention		—		74		505		—		199		1,246		76		—		2,100
Substandard		—		—		—		763		288		2,585		35		—		3,671
Doubtful		—		—		—		—		—		—		—		—		—
Total	$	9,568	$	45,886	$	52,843	$	22,353	$	16,631	$	69,048	$	23,677	$	—	$	240,006
Agriculture
Current period gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Business Loans
Risk Rating
Pass	$	18,194	$	104,502	$	72,834	$	40,876	$	17,883	$	54,141	$	37,884	$	—	$	346,314
Special Mention		—		—		—		—		—		—		—		—		—
Substandard		3,036		1,622		—		317		—		1,308		940		—		7,223
Doubtful		—		—		—		—		—		—		—		—		—
Total	$	21,230	$	106,124	$	72,834	$	41,193	$	17,883	$	55,449	$	38,824	$	—	$	353,537
Business Loans
Current period gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Non-Owner Occupied CRE
Risk Rating
Pass	$	7,587	$	42,243	$	26,412	$	13,336	$	8,062	$	13,887	$	4,605	$	—	$	116,132
Special Mention		—		548		—		—		—		—		—		—		548
Substandard		—		—		—		—		2,413		319		—		—		2,732
Doubtful		—		—		—		—		—		—		—		—		—
Total	$	7,587	$	42,791	$	26,412	$	13,336	$	10,475	$	14,206	$	4,605	$	—	$	119,412
Non-Owner Occupied CRE
Current period gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Total
Risk Rating
Pass	$	35,349	$	192,557	$	151,584	$	75,802	$	42,089	$	133,245	$	66,055	$	—	$	696,681
Special Mention		—		622		505		—		199		1,246		76		—		2,648
Substandard		3,036		1,622		—		1,080		2,701		4,212		975		—		13,626
Doubtful		—		—		—		—		—		—		—		—		—
Total (a)	$	38,385	$	194,801	$	152,089	$	76,882	$	44,989	$	138,703	$	67,106	$	—	$	712,955

(a) Refer to Note 1, Accounting Pronouncements Adopted in 2023 for details of reclassification of the portfolio segments related to adoption of ASU 2016-13 Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments.  

													Revolving		Revolving
	Term Loans Amortized Costs Basis by Origination Year												Loans		Loans
													Amortized		Converted
March 31, 2023	2023		2022		2021		2020		2019		Prior		Cost Basis		to Term		Total
Consumer
Payment Performance
Performing	$	1,670	$	1,756	$	747	$	336	$	82	$	8	$	1,427	$	—	$	6,026
Nonperforming		—		7		21		—		—		7		—		—		35
Total	$	1,670	$	1,763	$	768	$	336	$	82	$	15	$	1,427	$	—	$	6,061
Consumer
Current period gross charge-offs	$	—	$	—	$	—	$	—	$	1	$	—	$	—	$	—	$	1
Home equity
Payment Performance
Performing	$	—	$	20,660	$	1,151	$	659	$	618	$	2,393	$	72,563	$	2,699	$	100,743
Nonperforming		—		—		—		—		—		—		—		—		—
Total	$	—	$	20,660	$	1,151	$	659	$	618	$	2,393	$	72,563	$	2,699	$	100,743
Home equity
Current period gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Residential Real Estate
Payment Performance
Performing	$	30,002	$	161,355	$	111,396	$	46,244	$	34,016	$	51,065	$	—	$	—	$	434,078
Nonperforming		—		—		—		—		—		137		—		—		137
Total	$	30,002	$	161,355	$	111,396	$	46,244	$	34,016	$	51,202	$	—	$	—	$	434,215
Residential Real Estate
Current period gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Total
Payment Performance
Performing	$	34,373	$	183,771	$	113,294	$	47,239	$	34,716	$	53,466	$	73,990	$	—	$	540,849
Nonperforming		—		7		21		—		—		144		—		—		172
Total (a)	$	34,373	$	183,778	$	113,315	$	47,239	$	34,716	$	53,610	$	73,990	$	—	$	541,021

Schedule of credit risk profile by internally assigned grade

December 31, 2022	Commercial Mortgages		Agriculture Mortgages		Construction		Commercial and Industrial		Tax-free Loans		Agriculture Loans		Total
	$		$		$		$		$		$		$
Grade:
Pass		209,534		214,905		83,240		85,977		28,664		26,749		649,069
Special Mention		—		1,966		3,553		893		—		132		6,544
Substandard		1,289		4,296		—		658		—		241		6,484
Doubtful		—		—		—		—		—		—		—
Loss		—		—		—		—		—		—		—
Total		210,823		221,167		86,793		87,528		28,664		27,122		662,097

Schedule of credit risk profile by payment performance

December 31, 2022	1-4 Family Residential Mortgages		Home Equity Loans		Home Equity Lines of Credit		Consumer		Total
Payment performance:	$		$		$		$		$
Performing		409,854		11,598		98,349		5,739		525,539
Non-performing		447		339		—		30		816
Total		410,301		11,937		98,349		5,769		526,355

Schedule of impaired loans

	Three Months Ended March 31
	2022
	$
Average recorded balance of impaired loans		2,878
Interest income recognized on impaired loans		8

Schedule of impaired loan analysis

IMPAIRED LOAN ANALYSIS
(DOLLARS IN THOUSANDS)
December 31, 2022	Recorded Investment		Unpaid Principal Balance		Related Allowance
	$		$		$
With no related allowance recorded:
Commercial real estate
Commercial mortgages		1,201		1,271		—
Agriculture mortgages		3,229		3,348		—
Construction		—		—		—
Total commercial real estate		4,430		4,619		—
Commercial and industrial
Commercial and industrial		190		199		—
Tax-free loans		—		—		—
Agriculture loans		—		—		—
Total commercial and industrial		190		199		—
Total with no related allowance		4,620		4,818		—
With an allowance recorded:
Commercial real estate
Commercial mortgages		—		—		—
Agriculture mortgages		—		—		—
Construction		—		—		—
Total commercial real estate		—		—		—
Commercial and industrial
Commercial and industrial		—		—		—
Tax-free loans		—		—		—
Agriculture loans		—		—		—
Total commercial and industrial		—		—		—
Total with a related allowance		—		—		—
Total by loan class:
Commercial real estate
Commercial mortgages		1,201		1,271		—
Agriculture mortgages		3,229		3,348		—
Construction		—		—		—
Total commercial real estate		4,430		4,619		—
Commercial and industrial
Commercial and industrial		190		199		—
Tax-free loans		—		—		—
Agriculture loans		—		—		—
Total commercial and industrial		190		199		—
Total		4,620		4,818		—

Schedule of allowance for credit losses by portfolio segment

			Impact of
	Beginning		adopting								Provisions			Ending
	Balance		ASC 326			Charge-offs			Recoveries		(Reductions)			Balance
Allowance for credit losses:
Commercial Real Estate	$	6,074	$	(6,074	)	$	—		$	—	$	—		$	—
Consumer Real Estate		5,442		(5,442	)		—			—		—			—
Commerical & Industrial		2,151		(2,151	)		—			—		—			—
Consumer		67		(67	)		—			—		—			—
Agriculture		—		3,537			—			63		(9	)		3,591
Business Loans		—		3,382			—			13		78			3,473
Consumer Loans		—		250			(1	)		—		21			270
Home Equity		—		2,129			—			—		189			2,318
Non-Owner Occupied CRE		—		875			—			—		67			942
Residential Real Estate		—		4,658			—			1		801			5,460
Unallocated		417		(417	)		—			—		—			—
Total (a)	$	14,151	$	680		$	(1	)	$	77	$	1,147		$	16,054

(a) Refer to Note 1, Accounting Pronouncements Adopted in 2023 for details of reclassification of the portfolio segments related to adoption of ASU 2016-13 Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments.

Schedule of allowance for credit losses

	Commercial Real Estate			Consumer Real Estate		Commercial and Industrial		Consumer			Unallocated			Total
	$			$		$		$			$			$
Allowance for credit losses:
Beginning balance - December 31, 2021		6,263			3,834		2,112		87			635			12,931
Charge-offs		(65	)		—		—		(1	)		—			(66	)
Recoveries		—			3		10		1			—			14
Provision		(90	)		41		193		(16	)		(28	)		100
Balance - March 31, 2022		6,108			3,878		2,315		71			607			12,979

Schedule of allowance for credit losses and recorded investment in loans receivable

As of March 31, 2023:	Agriculture		Business Loans		Consumer Loans		Home Equity		Non- Owner Occupied CRE		Residential Real Estate		Total
	$		$		$		$		$		$		$
Allowance for credit losses:
Ending balance: individually evaluated		—		—		—		—		—		—		—
Ending balance: collectively evaluated		3,591		3,473		270		2,318		942		5,460		16,054
Loans receivable:
Ending balance		240,006		353,537		6,061		100,743		119,412		434,215		1,253,974
Ending balance: individually evaluated		2,591		1,351		—		—		—		—		3,942
Ending balance: collectively evaluated		237,415		352,186		6,061		100,743		119,412		434,215		1,250,032

As of December 31, 2022:	Commercial Real Estate		Consumer Real Estate		Commercial and Industrial		Consumer		Unallocated		Total
	$		$		$		$		$		$
Allowance for credit losses:
Ending balance: individually evaluated for impairment		—		—		—		—		—		—
Ending balance: collectively evaluated for impairment		6,074		5,442		2,151		67		417		14,151
Loans receivable:
Ending balance		518,783		520,587		143,314		5,769				1,188,453
Ending balance: individually evaluated for impairment		4,430		—		190		—				4,620
Ending balance: collectively evaluated for impairment		514,353		520,587		143,124		5,769				1,183,833