ALLOWANCE FOR CREDIT LOSSES (Tables)

12 Months Ended

Dec. 31, 2021

ALLOWANCE FOR CREDIT LOSSES

Loans by risk grades, loan class and vintage

Loans by risk grades, loan class and vintage, as of December 31, 2021 were as follows:

(Dollars in thousands)	2021		2020		2019		2018		2017		Prior		Revolving Loans		Converted Revolving Loans		Total
Commercial and industrial:
Pass	$	230,432	$	53,744	$	60,514	$	21,059	$	8,117	$	5,533	$	228,247	$	5,773	$	613,419
Special mention		—		—		290		15		—		—		3,177		—		3,482
Substandard		—		1,014		1,852		7,075		4		391		1,647		5,500		17,483
Total commercial and industrial		230,432		54,758		62,656		28,149		8,121		5,924		233,071		11,273		634,384
Commercial real estate:
Pass		243,666		197,625		232,074		141,591		69,995		84,398		55,253		13,799		1,038,401
Special mention		—		—		859		7,934		—		62		—		—		8,855
Substandard		—		2,953		12,967		14,556		334		3,046		—		10,857		44,713
Total commercial real estate		243,666		200,578		245,900		164,081		70,329		87,506		55,253		24,656		1,091,969
Construction and development:
Pass		197,900		99,420		54,017		7,127		16,133		142		72,698		96		447,533
Special mention		—		470		—		—		—		—		—		—		470
Substandard		—		292		—		1,500		10,207		717		—		—		12,716
Total construction and development		197,900		100,182		54,017		8,627		26,340		859		72,698		96		460,719
1-4 family residential:
Pass		115,451		23,298		20,210		31,416		21,607		53,253		6,516		466		272,217
Special mention		—		—		—		—		—		—		—		—		—
Substandard		—		1,548		514		902		126		464		1,502		—		5,056
Total 1-4 family residential		115,451		24,846		20,724		32,318		21,733		53,717		8,018		466		277,273
Multi-family residential:
Pass		16,744		18,236		6,473		58,750		9,784		167,033		9,376		—		286,396
Total multi-family residential		16,744		18,236		6,473		58,750		9,784		167,033		9,376		—		286,396
Consumer:
Pass		6,427		3,637		1,199		714		277		11		14,921		679		27,865
Substandard		—		40		—		—		—		—		85		100		225
Total consumer		6,427		3,677		1,199		714		277		11		15,006		779		28,090
Agriculture:
Pass		2,954		423		42		57		35		—		4,198		190		7,899
Substandard		—		—		—		—		—		18		24		—		42
Total agriculture		2,954		423		42		57		35		18		4,222		190		7,941
Other:
Pass		27,656		3,744		630		1,509		10		2,157		53,906		43		89,655
Substandard		—				—		—		—		—		—		—		—
Total other		27,656		3,744		630		1,509		10		2,157		53,906		43		89,655
Total
Pass		841,230		400,127		375,159		262,223		125,958		312,527		445,115		21,046		2,783,385
Special mention		—		470		1,149		7,949		—		62		3,177		—		12,807
Substandard		—		5,847		15,333		24,033		10,671		4,636		3,258		16,457		80,235
Total gross loans	$	841,230	$	406,444	$	391,641	$	294,205	$	136,629	$	317,225	$	451,550	$	37,503	$	2,876,427

Loans by risk grades, loan class and vintage, as of December 31, 2020 were as follows:

(Dollars in thousands)	2020		2019		2018		2017		2016		Prior		Revolving Loans		Converted Revolving Loans		Total
Commercial and industrial:
Pass	$	349,697	$	81,131	$	46,973	$	13,161	$	8,349	$	3,432	$	214,160	$	3,562	$	720,465
Special mention		—		—		33		—		—		—		3,371		—		3,404
Substandard		1,001		2,633		6,177		15		20		2,021		779		6,442		19,088
Total commercial and industrial		350,698		83,764		53,183		13,176		8,369		5,453		218,310		10,004		742,957
Commercial real estate:
Pass		262,072		210,954		196,630		138,424		68,468		84,453		30,020		9,482		1,000,503
Special mention		—		1,224		—		—		—		1,390		—		4,905		7,519
Substandard		—		11,532		9,599		476		1,059		1,985		9,325		—		33,976
Total commercial real estate		262,072		223,710		206,229		138,900		69,527		87,828		39,345		14,387		1,041,998
Construction and development:
Pass		165,894		163,658		92,455		20,146		6,707		273		53,800		—		502,933
Substandard		—		238		8,386		10,532		—		616		—		—		19,772
Total construction and development		165,894		163,896		100,841		30,678		6,707		889		53,800		—		522,705
1-4 family residential:
Pass		27,002		30,978		48,561		34,970		24,386		57,122		7,004		631		230,654
Special mention		1,548		—		—		—		1,617		—		—		—		3,165
Substandard		—		534		1,211		1,571		15		1,215		—		1,507		6,053
Total 1-4 family residential		28,550		31,512		49,772		36,541		26,018		58,337		7,004		2,138		239,872
Multi-family residential:
Pass		20,823		3,119		36,971		10,655		2,153		184,539		86		—		258,346
Total multi-family residential		20,823		3,119		36,971		10,655		2,153		184,539		86		—		258,346
Consumer:
Pass		8,937		3,073		1,855		1,875		146		23		17,573		402		33,884
Total consumer		8,937		3,073		1,855		1,875		146		23		17,573		402		33,884
Agriculture:
Pass		3,937		105		338		86		16		—		4,108		7		8,597
Substandard		—		—		—		—		—		23		50		—		73
Total agriculture		3,937		105		338		86		16		23		4,158		7		8,670
Other:
Pass		14,624		3,239		3,562		24		84		1,250		57,603		—		80,386
Substandard		1,211		—		—		—		1,232		—		5,409		—		7,852
Total other		15,835		3,239		3,562		24		1,316		1,250		63,012		—		88,238
Total
Pass		852,986		496,257		427,345		219,341		110,309		331,092		384,354		14,084		2,835,768
Special mention		1,548		1,224		33		—		1,617		1,390		3,371		4,905		14,088
Substandard		2,212		14,937		25,373		12,594		2,326		5,860		15,563		7,949		86,814
Total gross loans	$	856,746	$	512,418	$	452,751	$	231,935	$	114,252	$	338,342	$	403,288	$	26,938	$	2,936,670

Loans by risk grades and loan class

(Dollars in thousands)	Pass		Special Mention		Substandard		Total Loans
December 31, 2021
Commercial and industrial	$	613,419	$	3,482	$	17,483	$	634,384
Real estate:
Commercial real estate		1,038,401		8,855		44,713		1,091,969
Construction and development		447,533		470		12,716		460,719
1-4 family residential		272,217		—		5,056		277,273
Multi-family residential		286,396		—		—		286,396
Consumer		27,865		—		225		28,090
Agriculture		7,899		—		42		7,941
Other		89,655		—		—		89,655
Total gross loans	$	2,783,385	$	12,807	$	80,235	$	2,876,427
December 31, 2020
Commercial and industrial	$	720,465	$	3,404	$	19,088	$	742,957
Real estate:
Commercial real estate		1,000,503		7,519		33,976		1,041,998
Construction and development		502,933		—		19,772		522,705
1-4 family residential		230,654		3,165		6,053		239,872
Multi-family residential		258,346		—		—		258,346
Consumer		33,884		—		—		33,884
Agriculture		8,597		—		73		8,670
Other		80,386		—		7,852		88,238
Total gross loans	$	2,835,768	$	14,088	$	86,814	$	2,936,670

Loans individually evaluated and collectively evaluated

	December 31, 2021						December 31, 2020
	Individually		Collectively				Individually		Collectively
	Evaluated		Evaluated		Total		Evaluated		Evaluated		Total
(Dollars in thousands)	Loans		Loans		Loans		Loans		Loans		Loans
Commercial and industrial	$	16,579	$	617,805	$	634,384	$	15,928	$	727,029	$	742,957
Real estate:
Commercial real estate		21,057		1,070,912		1,091,969		18,768		1,023,230		1,041,998
Construction and development		12,716		448,003		460,719		12,886		509,819		522,705
1-4 family residential		3,355		273,918		277,273		2,210		237,662		239,872
Multi-family residential		—		286,396		286,396		—		258,346		258,346
Consumer		125		27,965		28,090		—		33,884		33,884
Agriculture		—		7,941		7,941		—		8,670		8,670
Other		5,440		84,215		89,655		7,851		80,387		88,238
Total gross loans	$	59,272	$	2,817,155	$	2,876,427	$	57,643	$	2,879,027	$	2,936,670

Activity in the total ACL for loans

			Real Estate
	Commercial				Construction
	and		Commercial		and		1-4 Family		Multi-family
(Dollars in thousands)	Industrial		Real Estate		Development		Residential		Residential		Consumer		Agriculture		Other		Total
December 31, 2021
Beginning balance	$	13,035	$	13,798	$	6,089	$	2,578	$	2,513	$	440	$	137	$	2,047	$	40,637
Provision (recapture)		(2,255)		(2,783)		(2,779)		(469)		(732)		(127)		(96)		(621)		(9,862)
Charge-offs		(519)		—		—		(5)		—		(13)		—		—		(537)
Recoveries		953		—		—		1		—		106		47		—		1,107
Net recoveries		434		—		—		(4)		—		93		47		—		570
Ending balance	$	11,214	$	11,015	$	3,310	$	2,105	$	1,781	$	406	$	88	$	1,426	$	31,345
Period-end amount allocated to:
Specific reserve	$	3,986	$	609	$	—	$	—	$	—	$	125	$	—	$	—	$	4,720
General reserve		7,228		10,406		3,310		2,105		1,781		281		88		1,426		26,625
Total	$	11,214	$	11,015	$	3,310	$	2,105	$	1,781	$	406	$	88	$	1,426	$	31,345
December 31, 2020
Beginning balance	$	7,671	$	7,975	$	4,446	$	2,257	$	1,699	$	388	$	74	$	770	$	25,280
Impact of CECL adoption		852		(140)		100		(275)		294		(25)		64		4		874
Provision (recapture)		4,432		5,979		1,543		666		520		175		(13)		4,772		18,074
Charge-offs		(714)		(163)		—		(71)		—		(112)		—		(3,500)		(4,560)
Recoveries		794		147		—		1		—		14		12		1		969
Net (charge-offs) recoveries		80		(16)		—		(70)		—		(98)		12		(3,499)		(3,591)
Ending balance	$	13,035	$	13,798	$	6,089	$	2,578	$	2,513	$	440	$	137	$	2,047	$	40,637
Period-end amount allocated to:
Specific reserve	$	5,004	$	323	$	—	$	—	$	—	$	—	$	—	$	206	$	5,533
General reserve		8,031		13,475		6,089		2,578		2,513		440		137		1,841		35,104
Total	$	13,035	$	13,798	$	6,089	$	2,578	$	2,513	$	440	$	137	$	2,047	$	40,637
December 31, 2019
Beginning balance	$	7,719	$	6,730	$	4,298	$	2,281	$	1,511	$	387	$	62	$	705	$	23,693
Provision (recapture) for credit losses for loans		715		1,209		148		(15)		188		27		2		111		2,385
Charge-offs		(1,252)		(45)		—		(12)		—		(97)		—		(52)		(1,458)
Recoveries		489		81		—		3		—		71		10		6		660
Net (charge-offs) recoveries		(763)		36		—		(9)		—		(26)		10		(46)		(798)
Ending balance	$	7,671	$	7,975	$	4,446	$	2,257	$	1,699	$	388	$	74	$	770	$	25,280
Period-end amount allocated to:
Specific reserve	$	416	$	—	$	—	$	15	$	—	$	—	$	—	$	6	$	437
General reserve		7,255		7,975		4,446		2,242		1,699		388		74		764		24,843
Total	$	7,671	$	7,975	$	4,446	$	2,257	$	1,699	$	388	$	74	$	770	$	25,280

ACL for loans by loan class

	December 31, 2021				December 31, 2020
(Dollars in thousands)	Amount		Percent		Amount		Percent
Commercial and industrial	$	11,214	35.7	%	$	13,035	32.1	%
Real estate:
Commercial real estate		11,015	35.1	%		13,798	34.0	%
Construction and development		3,310	10.6	%		6,089	15.0	%
1-4 family residential		2,105	6.7	%		2,578	6.3	%
Multi-family residential		1,781	5.7	%		2,513	6.2	%
Consumer		406	1.3	%		440	1.1	%
Agriculture		88	0.3	%		137	0.3	%
Other		1,426	4.6	%		2,047	5.0	%
Total allowance for credit losses for loans	$	31,345	100.0	%	$	40,637	100.0	%
Loans excluding loans held for sale		2,867,524				2,924,117
ACL for loans to loans excluding loans held for sale		1.09%				1.39%

Charge-offs and recoveries by loan class and vintage

Charge-offs and recoveries by loan class and vintage for the year ended December 31, 2021 were as follows:

(Dollars in thousands)	2021		2020		2019		2018		2017		Prior		Revolving Loans		Converted Revolving Loans		Total
Commercial and industrial:
Charge-off	$	—	$	—	$	(191)	$	(260)	$	—	$	—	$	(68)	$	—	$	(519)
Recovery		—		—		6		70		48		777		52		—		953
Total commercial and industrial		—		—		(185)		(190)		48		777		(16)		—		434
1-4 family residential:
Charge-off		—		—		—		—		—		(5)		—		—		(5)
Recovery		—		—		—		—		—		1		—		—		1
Total 1-4 family residential		—		—		—		—		—		(4)		—		—		(4)
Consumer:
Charge-off		(10)		—		(3)		—		—		—		—		—		(13)
Recovery		2		—		5		—		—		99		—		—		106
Total consumer		(8)		—		2		—		—		99		—		—		93
Agriculture:
Recovery		—		—		—		—		—		47		—		—		47
Total agriculture		—		—		—		—		—		47		—		—		47
Total:
Charge-off		(10)		—		(194)		(260)		—		(5)		(68)		—		(537)
Recovery		2		—		11		70		48		924		52		—		1,107
Total	$	(8)	$	—	$	(183)	$	(190)	$	48	$	919	$	(16)	$	—	$	570

Charge-offs and recoveries by loan class and vintage for the year ended December 31, 2020 were as follows:

(Dollars in thousands)	2020		2019		2018		2017		2016		Prior		Revolving Loans		Converted Revolving Loans		Total
Commercial and industrial:
Charge-off	$	—	$	(38)	$	(57)	$	(35)	$	(42)	$	—	$	(542)	$	—	$	(714)
Recovery		—		3		170		46		29		326		220		8		802
Total commercial and industrial		—		(35)		113		11		(13)		326		(322)		8		88
Commercial real estate:
Charge-off		—		—		—		—		—		(163)		—		—		(163)
Recovery		—		—		2		—		—		145		—		—		147
Total commercial real estate		—		—		2		—		—		(18)		—		—		(16)
1-4 family residential:
Charge-off		—		(64)		—		—		—		(7)		—		—		(71)
Recovery		—		—		—		—		—		1		—		—		1
Total 1-4 family residential		—		(64)		—		—		—		(6)		—		—		(70)
Consumer:
Charge-off		—		(3)		(14)		(95)		—		—		—		—		(112)
Recovery		5		2		6		—		—		1		—		—		14
Total consumer		5		(1)		(8)		(95)		—		1		—		—		(98)
Agriculture:
Recovery		—		—		—		—		12		—		—		—		12
Total agriculture		—		—		—		—		12		—		—		—		12
Other:
Charge-off		—		(3,500)		—		—		—		—		—		—		(3,500)
Recovery		—		—		—		1		—		—		—		—		1
Total other		—		(3,500)		—		1		—		—		—		—		(3,499)
Total:
Charge-off		—		(3,605)		(71)		(130)		(42)		(170)		(542)		—		(4,560)
Recovery		5		5		178		47		41		473		220		8		977
Total	$	5	$	(3,600)	$	107	$	(83)	$	(1)	$	303	$	(322)	$	8	$	(3,583)

Activity in the ACL for unfunded commitments

	December 31,
(Dollars in thousands)		2021		2020
Beginning balance	$	4,177	$	378
Impact of CECL adoption		—		2,981
Provision (recapture)		(911)		818
Ending balance	$	3,266	$	4,177