Allowance for Credit Losses (Tables)

9 Months Ended

Sep. 30, 2024

Allowance for Credit Loss [Abstract]

Summary of Allowance for Credit Losses by Loan Segment

The following tables summarize the activity in the allowance for credit losses by loan segment for the three and nine months ended September 30, 2024 and 2023.

	Beginning balance		Charge-offs			Recoveries		Provision for credit losses			Ending balance
(In Thousands)	For the Three Months Ended September 30, 2024
Allowance for credit losses:
Agriculture and farmland	$	12	$	—		$	—	$	—		$	12
Construction		1,841		—			1		(537	)		1,305
Commercial & industrial		3,435		—			37		(368	)		3,104
Commercial real estate
Multifamily		1,914		—			—		263			2,177
Owner occupied		5,882		(23	)		—		148			6,007
Non-owner occupied		8,026		—			—		730			8,756
Residential real estate
First liens		4,047		—			6		(285	)		3,768
Second liens and lines of credit		977		—			3		119			1,099
Municipal		64		—			—		1			65
Consumer		91		—			4		154			249
Total	$	26,289	$	(23	)	$	51	$	225		$	26,542
	Beginning balance		Charge-offs			Recoveries		Provision for credit losses			Ending balance
(In Thousands)	For the Three Months Ended September 30, 2023
Allowance for credit losses:
Agriculture and farmland	$	209	$	—		$	—	$	(130	)	$	79
Construction		728		—			—		(275	)		453
Commercial & industrial		729		—			—		126			855
Commercial real estate									—
Multifamily		673		—			—		(254	)		419
Owner occupied		1,559		—			—		197			1,756
Non-owner occupied		4,350		—			—		(220	)		4,130
Residential real estate									—
First liens		1,397		—			11		44			1,452
Second liens and lines of credit		383		—			1		(58	)		326
Municipal		7		—			—		—			7
Consumer		22		—			—		2			24
Unallocated		171		—			—		292			463
Total	$	10,228	$	-		$	12	$	(276	)	$	9,964

	Beginning balance		Charge-offs			Recoveries		Allowance for Credit Losses on PCD Acquired Loans		Provision for credit losses			Ending balance
(In Thousands)	For the Nine Months Ended September 30, 2024
Allowance for credit losses:
Agriculture and farmland	$	12	$	—		$	—	$	—	$	—		$	12
Construction		959		—			3		—		343			1,305
Commercial & industrial		2,940		(10	)		46		—		128			3,104
Commercial real estate
Multifamily		1,483		—			2		—		692			2,177
Owner occupied		6,572		(29	)		1		—		(537	)		6,007
Non-owner occupied		5,773		(54	)		5		2,300		732			8,756
Residential real estate
First liens		4,778		—			19		—		(1,029	)		3,768
Second liens and lines of credit		1,072		—			12		—		15			1,099
Municipal		79		—			—		—		(14	)		65
Consumer		99		(25	)		8		—		167			249
Total	$	23,767	$	(118	)	$	96	$	2,300	$	497		$	26,542
	Beginning balance, prior to adoption of ASC 326		Impact of adopting ASC 326			Charge-offs		Recoveries		Provision for credit losses			Ending balance
(In Thousands)	For the Nine Months Ended September 30, 2023
Allowance for credit losses:
Agriculture and farmland	$	279	$	(190	)	$	—	$	—	$	(10	)	$	79
Construction		274		513			—		—		(334	)		453
Commercial & industrial		583		283			—		1		(12	)		855
Commercial real estate
Multifamily		480		340			—		—		(401	)		419
Owner occupied		635		760			—		—		361			1,756
Non-owner occupied		1,116		3,195			—		—		(181	)		4,130
Residential real estate
First liens		1,029		635			—		50		(262	)		1,452
Second liens and lines of credit		218		140			—		60		(92	)		326
Municipal		12		(2	)		—		—		(3	)		7
Consumer		40		(19	)		—		—		3			24
Unallocated		—		—			—		—		463			463
Total	$	4,666	$	5,655		$	—	$	111	$	(468	)	$	9,964

Summary of Amortized Cost Basis of Nonaccrual Loans and Loans Past due 90 Days or Greater and Still Accruing

The following tables present the amortized cost basis of nonaccrual loans and loans past due 90 days or greater and still accruing by segments of the loan portfolio:

	As of September 30, 2024
(In Thousands)	Nonaccrual with No Allowance for Credit Loss		Nonaccrual with a related Allowance for Credit Loss		Total Nonaccrual		Loans 90 days or greater past due still accruing
Agriculture and farmland	$	—	$	—	$	—	$	—
Construction		10		—		10		87
Commercial & industrial		112		100		212		199
Commercial real estate
Multifamily		—		—		—		—
Owner occupied		9,114		680		9,794		—
Non-owner occupied		401		3,952		4,353		—
Residential real estate
First liens		1,980		—		1,980		209
Second liens and lines of credit		382		—		382		—
Municipal		—		—		—		—
Consumer		2		150		152		—
Total	$	12,001	$	4,882	$	16,883	$	495
	As of December 31, 2023
(In Thousands)	Nonaccrual with No Allowance for Credit Loss		Nonaccrual with a related Allowance for Credit Loss		Total Nonaccrual		Loans 90 days or greater past due still accruing
Agriculture and farmland	$	—	$	—	$	—	$	—
Construction		191		—		191		—
Commercial & industrial		53		8		61		58
Commercial real estate
Multifamily		—		—		—		—
Owner occupied		2,465		83		2,548		6
Non-owner occupied		948		281		1,229		—
Residential real estate
First liens		2,346		361		2,707		149
Second liens and lines of credit		294		—		294		—
Municipal		—		—		—		—
Consumer		7		—		7		—
Total	$	6,304	$	733	$	7,037	$	213

Summary by Class of Loans, Carrying Value of Collateral Dependent Nonaccrual Loans and Type of Collateral

The following tables present, by class of loans, the carrying value of collateral dependent nonaccrual loans and type of collateral as of September 30, 2024 and December 31, 2023.

	September 30, 2024
(In Thousands)	Real Estate		Business Assets		Other		Total
Agriculture and farmland loans	$	—	$	—	$	—	$	—
Construction		10		—		—		10
Commercial & industrial loans		—		212		—		212
Commercial real estate loans
Multifamily		—		—		—		—
Owner occupied		9,794		—		—		9,794
Non-owner occupied		4,353		—		—		4,353
Residential real estate loans
First liens		1,980		—		—		1,980
Second liens and lines of credit		382		—		—		382
Municipal		—		—		—		—
Consumer		—		—		152		152
	$	16,519	$	212	$	152	$	16,883
	December 31, 2023
(In Thousands)	Real Estate		Business Assets		Other		Total
Agriculture and farmland loans	$	—	$	—	$	—	$	—
Construction		191		—		—		191
Commercial & industrial loans		—		61		—		61
Commercial real estate loans
Multifamily		—		—		—		—
Owner occupied		2,548		—		—		2,548
Non-owner occupied		1,229		—		—		1,229
Residential real estate loans
First liens		2,707		—		—		2,707
Second liens and lines of credit		294		—		—		294
Municipal		—		—		—		—
Consumer		—		—		7		7
	$	6,969	$	61	$	7	$	7,037

Summary of Aging Analysis of the Recorded Investment of Past-Due Loans

The following tables present an aging analysis of the recorded investment of past due loans at September 30, 2024 and December 31, 2023.

		September 30, 2024
(In Thousands)		30-59 Days Past Due		60-89 Days Past Due		90 Days or Greater Past Due		Total Past Due		Current		Total   Loans
Agriculture and farmland		$	91	$	—	$	—	$	91	$	65,075	$	65,166
Construction			771		10		87		868		161,164		162,032
Commercial & industrial			69		—		411		480		234,664		235,144
Commercial real estate
Multifamily			163		—		—		163		206,704		206,867
Owner occupied			—		177		9,618		9,795		469,566		479,361
Non-owner occupied			200		—		401		601		598,080		598,681
Residential real estate
First liens			485		197		1,187		1,869		372,261		374,130
Second liens and lines of credit			419		53		337		809		71,252		72,061
Municipal			—		—		—		—		17,496		17,496
Consumer			24		3		152		179		4,117		4,296
Total		$	2,222	$	440	$	12,193	$	14,855	$	2,200,379	$	2,215,234
	December 31, 2023
(In Thousands)		30-59 Days Past Due		60-89 Days Past Due		90 Days or Greater Past Due		Total Past Due		Current		Total   Loans
Agriculture and farmland		$	14	$	—	$	—	$	14	$	65,847	$	65,861
Construction			10		—		191		201		161,624		161,825
Commercial & industrial			46		1		118		165		232,247		232,412
Commercial real estate
Multifamily			—		—		—		—		176,843		176,843
Owner occupied			156		2,802		137		3,095		471,869		474,964
Non-owner occupied			—		86		1,239		1,325		550,156		551,481
Residential real estate
First liens			719		419		872		2,010		374,082		376,092
Second liens and lines of credit			279		128		97		504		66,144		66,648
Municipal			—		—		—		—		16,740		16,740
Consumer			15		15		7		37		5,207		5,244
Total		$	1,239	$	3,451	$	2,661	$	7,351	$	2,120,759	$	2,128,110

Summary of Classes of the Loan Portfolio Summarized by the Internal Risk Rating System

The following tables present the classes of the loan portfolio summarized by the internal risk rating system as of September 30, 2024.

	September 30, 2024
	Term Loans Amortized Cost Basis by Origination Year
(In Thousands)	2024		2023		2022		2021		2020		Prior		Revolving loans amortized cost basis		Revolving loans converted to term		Total
Agriculture and farmland
Pass	$	8,618	$	1,159	$	13,823	$	9,063	$	4,875	$	21,326	$	4,589	$	—	$	63,453
Special mention		—		11		—		58		—		1,412		232		—		1,713
Substandard or lower		—		—		—		—		—		—		—		—		—
Total Agriculture and farmland	$	8,618	$	1,170	$	13,823	$	9,121	$	4,875	$	22,738	$	4,821	$	—	$	65,166
Agriculture and farmland
Current period gross charge-offs		—		—		—		—		—		—		—		—		—
Construction
Pass		19,699		63,145		36,057		21,445		1,257		9,420		6,523		4,198		161,744
Special mention		—		—		—		—		—		—		—		—		—
Substandard or lower		—		201		—		—		—		—		—		87		288
Total Construction		19,699		63,346		36,057		21,445		1,257		9,420		6,523		4,285		162,032
Construction
Current period gross charge-offs		—		—		—		—		—		—		—		—		—
Commercial & industrial
Pass		29,155		23,773		20,312		20,608		11,362		8,934		107,010		25		221,179
Special mention		18		162		4,636		100		—		379		6,543		—		11,838
Substandard or lower		—		78		462		93		—		332		1,162		—		2,127
Total Commercial & industrial		29,173		24,013		25,410		20,801		11,362		9,645		114,715		25		235,144
Commercial & industrial
Current period gross charge-offs		—		—		—		—		4		6		—		—		10
Commercial real estate - Multifamily
Pass		29,461		9,802		85,776		50,770		19,666		10,613		779		—		206,867
Special mention		—		—		—		—		—		—		—		—		—
Substandard or lower		—		—		—		—		—		—		—		—		—
Total Commercial real estate - Multifamily		29,461		9,802		85,776		50,770		19,666		10,613		779		—		206,867
Commercial real estate - Multifamily
Current period gross charge-offs		—		—		—		—		—		—		—		—		—

	September 30, 2024
	Term Loans Amortized Cost Basis by Origination Year
(In Thousands)	2024		2023		2022		2021		2020		Prior		Revolving loans amortized cost basis		Revolving loans converted to term		Total
Commercial real estate - Owner occupied
Pass		43,553		55,583		102,551		86,993		48,793		105,750		12,316		—		455,539
Special mention		—		—		367		2,397		417		5,793		300		—		9,274
Substandard or lower		—		—		9,412		—		—		5,009		127		—		14,548
Total Commercial real estate - Owner occupied		43,553		55,583		112,330		89,390		49,210		116,552		12,743		—		479,361
Commercial real estate - Owner occupied
Current period gross charge-offs		—		—		—		—		23		6		—		—		29
Commercial real estate - Non-owner occupied
Pass		49,559		55,116		171,283		115,689		51,234		133,419		10,578		—		586,878
Special mention		1,000		—		—		38		3,376		3,089		—		—		7,503
Substandard or lower		—		—		—		3,899		—		327		74		—		4,300
Total Commercial real estate - Non-owner occupied		50,559		55,116		171,283		119,626		54,610		136,835		10,652		—		598,681
Commercial real estate - Non-owner occupied
Current period gross charge-offs		—		—		—		—		—		54		—		—		54
Municipal
Pass		44		428		—		369		935		2,435		85		—		4,296
Special mention		—		—		—		—		—		—		—		—		—
Substandard or lower		—		—		—		—		—		—		—		—		—
Total Commercial real estate - Municipal		44		428		—		369		935		2,435		85		—		4,296
Municipal
Current period gross charge-offs		—		—		—		—		—		—		—		—		—
Total
Pass	$	180,089	$	209,006	$	429,802	$	304,937	$	138,122	$	291,897	$	141,880	$	4,223	$	1,699,956
Special mention		1,018		173		5,003		2,593		3,793		10,673		7,075		—		30,328
Substandard or lower		—		279		9,874		3,992		—		5,668		1,363		87		21,263
Total	$	181,107	$	209,458	$	444,679	$	311,522	$	141,915	$	308,238	$	150,318	$	4,310	$	1,751,547

The following tables present the classes of the loan portfolio summarized by the internal risk rating system as of December 31, 2023.

	December 31, 2023
	Term Loans Amortized Cost Basis by Origination Year
(In Thousands)	2023		2022		2021		2020		2019		Prior		Revolving loans amortized cost basis		Revolving loans converted to term		Total
Agriculture and farmland
Pass	$	1,466	$	14,372	$	9,613	$	5,147	$	2,319	$	22,627	$	5,114	$	29	$	60,687
Special mention		—		—		30		—		811		1,206		342		—		2,389
Substandard or lower		13		—		15		121		—		2,576		60		—		2,785
Total Agriculture and farmland	$	1,479	$	14,372	$	9,658	$	5,268	$	3,130	$	26,409	$	5,516	$	29	$	65,861
Agriculture and farmland
Current period gross charge-offs		—		—		—		—		—		—		—		—		—
Construction
Pass		55,462		45,206		30,593		2,932		6,161		5,446		14,424		1,317		161,541
Special mention		—		—		—		—		—		—		93		—		93
Substandard or lower		—		—		—		98		—		—		—		93		191
Total Construction		55,462		45,206		30,593		3,030		6,161		5,446		14,517		1,410		161,825
Construction
Current period gross charge-offs		—		—		—		—		—		—		—		—		—
Commercial & industrial
Pass		29,586		31,653		24,184		13,831		4,285		7,536		119,602		68		230,745
Special mention		—		113		139		—		15		4		1,071		—		1,342
Substandard or lower		—		—		47		—		194		—		43		41		325
Total Commercial & industrial		29,586		31,766		24,370		13,831		4,494		7,540		120,716		109		232,412
Commercial & industrial
Current period gross charge-offs		—		—		—		—		—		—		200		—		200
Commercial real estate - Multifamily
Pass		12,587		80,127		50,320		18,871		6,031		6,737		298		—		174,971
Special mention		—		—		—		—		—		—		—		—		—
Substandard or lower		—		—		—		—		—		1,872		—		—		1,872
Total Commercial real estate - Multifamily		12,587		80,127		50,320		18,871		6,031		8,609		298		—		176,843
Commercial real estate - Multifamily
Current period gross charge-offs		—		—		—		—		—		—		—		—		—

	December 31, 2023
	Term Loans Amortized Cost Basis by Origination Year
(In Thousands)	2023		2022		2021		2020		2019		Prior		Revolving loans amortized cost basis		Revolving loans converted to term		Total
Commercial real estate - Owner occupied
Pass		53,765		127,684		96,193		50,888		39,043		83,753		7,801		6		459,133
Special mention		—		377		3,125		—		6,318		—		429		—		10,249
Substandard or lower		—		—		—		626		2,408		2,391		157		—		5,582
Total Commercial real estate - Owner occupied		53,765		128,061		99,318		51,514		47,769		86,144		8,387		6		474,964
Commercial real estate - Owner occupied
Current period gross charge-offs		—		—		—		—		—		—		—		—		—
Commercial real estate - Non-owner occupied
Pass		58,210		173,415		118,081		56,025		59,792		78,465		6,177		86		550,251
Special mention		—		—		42		—		—		—		—		—		42
Substandard or lower		—		—		325		—		56		558		249		—		1,188
Total Commercial real estate - Non-owner occupied		58,210		173,415		118,448		56,025		59,848		79,023		6,426		86		551,481
Commercial real estate - Non-owner occupied
Current period gross charge-offs		—		—		—		—		—		—		—		—		—
Municipal
Pass		529		—		420		1,675		—		2,526		94		—		5,244
Special mention		—		—		—		—		—		—		—		—		—
Substandard or lower		—		—		—		—		—		—		—		—		—
Total Commercial real estate - Municipal		529		—		420		1,675		—		2,526		94		—		5,244
Municipal
Current period gross charge-offs		—		—		—		—		—		—		—		—		—
Total
Pass	$	211,605	$	472,457	$	329,404	$	149,369	$	117,631	$	207,090	$	153,510	$	1,506	$	1,642,572
Special mention		—		490		3,336		—		7,144		1,210		1,935		—		14,115
Substandard or lower		13		—		387		845		2,658		7,397		509		134		11,943
Total	$	211,618	$	472,947	$	333,127	$	150,214	$	127,433	$	215,697	$	155,954	$	1,640	$	1,668,630

The following tables present the amortized cost of these loans based on payment activity, by origination year, as of September 30, 2024 and December 31, 2023.

	September 30, 2024
	Term Loans Amortized Cost Basis by Origination Year
(In Thousands)	2024		2023		2022		2021		2020		Prior		Revolving loans amortized cost basis		Revolving loans converted to term		Total
Residential real estate - First liens
Performing	$	25,492	$	45,884	$	88,268	$	83,872	$	36,371	$	81,295	$	10,759	$	—	$	371,941
Nonperforming		—		—		—		22		—		2,167		—		—		2,189
Total Residential real estate - First liens	$	25,492	$	45,884	$	88,268	$	83,894	$	36,371	$	83,462	$	10,759	$	—	$	374,130
Residential real estate - First liens
Current period gross charge-offs		—		—		—		—		—		—		—		—		—
Residential real estate - Second liens and lines of credit
Performing		1,961		954		1,465		364		63		2,089		64,778		5		71,679
Nonperforming		—		—		—		—		—		162		220		—		382
Total Residential real estate - Second liens and lines of credit		1,961		954		1,465		364		63		2,251		64,998		5		72,061
Residential real estate - Second liens and lines of credit
Current period gross charge-offs		—		—		—		—		—		—		—		—		—
Consumer and other
Performing		2,644		4,685		1,952		126		69		66		7,802		—		17,344
Nonperforming		—		—		2		—		—		—		150		—		152
Total Consumer and other		2,644		4,685		1,954		126		69		66		7,952		—		17,496
Consumer and other
Current period gross charge-offs		—		—		2		5		2		16		—		—		25
Total
Performing	$	30,097	$	51,523	$	91,685	$	84,362	$	36,503	$	83,450	$	83,339	$	5	$	460,964
Nonperforming		—		—		2		22		—		2,329		370		—		2,723
Total	$	30,097	$	51,523	$	91,687	$	84,384	$	36,503	$	85,779	$	83,709	$	5	$	463,687

	December 31, 2023
	Term Loans Amortized Cost Basis by Origination Year
(In Thousands)	2023		2022		2021		2020		2019		Prior		Revolving loans amortized cost basis		Revolving loans converted to term		Total
Residential real estate - First liens
Performing	$	41,984	$	90,220	$	95,232	$	37,966	$	22,934	$	75,918	$	8,982	$	—	$	373,236
Nonperforming		—		—		33		101		208		2,514		—		—		2,856
Total Residential real estate - First liens	$	41,984	$	90,220	$	95,265	$	38,067	$	23,142	$	78,432	$	8,982	$	—	$	376,092
Residential real estate - First liens
Current period gross charge-offs		—		—		—		—		—		—		—		—		—
Residential real estate - Second liens and lines of credit
Performing		1,045		1,702		386		184		205		2,259		60,573		—		66,354
Nonperforming		—		—		—		—		—		—		294		—		294
Total Residential real estate - Second liens and lines of credit		1,045		1,702		386		184		205		2,259		60,867		—		66,648
Residential real estate - Second liens and lines of credit
Current period gross charge-offs		—		—		—		—		—		—		—		—		—
Consumer and other
Performing		5,007		437		213		150		73		85		10,768		—		16,733
Nonperforming		—		—		—		—		—		—		7		—		7
Total Consumer and other		5,007		437		213		150		73		85		10,775		—		16,740
Consumer and other
Current period gross charge-offs		—		—		—		—		—		—		1		—		1
Total
Performing	$	48,036	$	92,359	$	95,831	$	38,300	$	23,212	$	78,262	$	80,323	$	—	$	456,323
Nonperforming		—		—		33		101		208		2,514		301		—		3,157
Total	$	48,036	$	92,359	$	95,864	$	38,401	$	23,420	$	80,776	$	80,624	$	—	$	459,480

Schedule of Credit Deteriorated Loans

The Company has purchased loans for which there was, at acquisition, evidence of more than insignificant deterioration of credit quality since origination. The carrying amount of these loans is as follows.

(In Thousands)	2023
Purchase price of loans at acquisition	$	435,704
Allowance for credit losses at acquisition		6,603
Non-credit (discount) premium at acquisition		(16,981	)
Par value of acquired loans at acquisition	$	425,326