10-Q

UNITED STATES  

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

Quarterly Report Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

For the Quarterly period ended September 30, 2021

Commission file number 001-35296

FARMERS NATIONAL BANC CORP.

(Exact name of registrant as specified in its charter)

Ohio	34-1371693
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No)
20 South Broad Street Canfield, OH	44406
(Address of principal executive offices)	(Zip Code)

(330) 533-3341

(Registrant’s telephone number, including area code)

Not applicable

(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  ☒    No  ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes  ☒    No  ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company.  See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☒
Non-accelerated filer	☐	Small reporting company	☐
Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ☐    No  ☒

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol	Name of each exchange on which registered
Common Stock, No Par Value	FMNB	The NASDAQ Stock Market

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

Class	Outstanding at October 31, 2021
Common Stock, No Par Value	28,321,581 shares

		Page Number
PART I - FINANCIAL INFORMATION
Item 1	Financial Statements (Unaudited)
	Included in Part I of this report:
	Farmers National Banc Corp. and Subsidiaries
	Consolidated Balance Sheets	2
	Consolidated Statements of Income	3
	Consolidated Statements of Comprehensive Income	4
	Consolidated Statements of Stockholders’ Equity	5
	Consolidated Statements of Cash Flows	7
	Notes to Unaudited Consolidated Financial Statements	8
Item 2	Management’s Discussion and Analysis of Financial Condition and Results of Operations	39
Item 3	Quantitative and Qualitative Disclosures About Market Risk	50
Item 4	Controls and Procedures	51
PART II - OTHER INFORMATION		51
Item 1	Legal Proceedings	51
Item 1A	Risk Factors	51
Item 2	Unregistered Sales of Equity Securities and Use of Proceeds	51
Item 3	Defaults Upon Senior Securities	52
Item 4	Mine Safety Disclosures	52
Item 5	Other Information	52
Item 6	Exhibits	53
SIGNATURES		54
10-Q Certifications
Section 906 Certifications

1

CONSOLIDATED BALANCE SHEETS

FARMERS NATIONAL BANC CORP. AND SUBSIDIARIES

	(In Thousands of Dollars)
(Unaudited)	September 30, 2021			December 31, 2020
ASSETS
Cash and due from banks	$	26,933		$	20,503
Federal funds sold and other		52,875			234,118
TOTAL CASH AND CASH EQUIVALENTS		79,808			254,621
Securities available for sale		1,183,361			575,600
Other investments		19,041			21,528
Loans held for sale		2,628			4,766
Loans		1,894,216			2,078,044
Less allowance for loan losses		23,136			22,144
NET LOANS		1,871,080			2,055,900
Premises and equipment, net		24,790			25,620
Goodwill		45,775			45,775
Other intangibles, net		2,895			3,842
Bank owned life insurance		51,894			51,322
Other assets		35,775			32,174
TOTAL ASSETS	$	3,317,047		$	3,071,148
LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits:
Noninterest-bearing	$	675,938		$	608,791
Interest-bearing		2,190,475			1,970,087
Brokered time deposits		0			32,000
TOTAL DEPOSITS		2,866,413			2,610,878
Short-term borrowings		0			2,521
Long-term borrowings		49,649			76,385
Other liabilities		23,461			31,267
TOTAL LIABILITIES		2,939,523			2,721,051
Commitments and contingent liabilities
Stockholders' Equity:
Common Stock - Authorized 50,000,000 shares; issued 29,577,827 in 2021 and 2020		208,539			208,763
Retained earnings		172,939			138,073
Accumulated other comprehensive income		14,260			22,032
Treasury stock, at cost; 1,256,246 shares in 2021 and 1,319,890 in 2020		(18,214	)		(18,771	)
TOTAL STOCKHOLDERS' EQUITY		377,524			350,097
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	3,317,047		$	3,071,148

See accompanying notes

2

CONSOLIDATED STATEMENTS OF INCOME

FARMERS NATIONAL BANC CORP. AND SUBSIDIARIES

	(In Thousands except Per Share Data)
	For the Three Months Ended						For the Nine Months Ended
(Unaudited)	September 30, 2021			September 30, 2020			September 30, 2021			September 30, 2020
INTEREST AND DIVIDEND INCOME
Loans, including fees	$	22,578		$	24,228		$	69,960		$	73,071
Taxable securities		3,222			1,263			7,452			4,088
Tax exempt securities		2,430			1,954			6,846			5,689
Dividends		113			138			355			415
Federal funds sold and other interest income		32			52			161			231
TOTAL INTEREST AND DIVIDEND INCOME		28,375			27,635			84,774			83,494
INTEREST EXPENSE
Deposits		1,346			3,153			5,401			11,652
Short-term borrowings		0			14			7			352
Long-term borrowings		495			303			1,075			1,102
TOTAL INTEREST EXPENSE		1,841			3,470			6,483			13,106
NET INTEREST INCOME		26,534			24,165			78,291			70,388
Provision (credit) for credit losses		(947	)		2,600			(472	)		6,100
Provision (credit) for unfunded loans		(1	)		0			(1	)		0
NET INTEREST INCOME AFTER PROVISION FOR CREDIT LOSSES		27,482			21,565			78,764			64,288
NONINTEREST INCOME
Service charges on deposit accounts		924			904			2,522			2,752
Bank owned life insurance income, including death benefit		340			196			924			608
Trust fees		2,335			1,973			6,929			5,682
Insurance agency commissions		799			784			2,748			2,348
Security gains (losses), including fair value changes for equity securities		459			70			979			201
Retirement plan consulting fees		334			341			1,043			1,129
Investment commissions		638			353			1,665			1,080
Net gains on sale of loans		1,466			3,119			6,557			7,754
Other mortgage banking income , net		32			(21	)		(138	)		(194	)
Debit card and EFT fees		1,128			1,048			3,438			2,866
Other operating income		560			450			2,039			1,436
TOTAL NONINTEREST INCOME		9,015			9,217			28,706			25,662
NONINTEREST EXPENSES
Salaries and employee benefits		9,321			10,244			29,163			30,188
Occupancy and equipment		1,899			1,719			6,064			5,194
State and local taxes		552			576			1,657			1,623
Professional fees		1,009			753			2,895			2,392
Merger related costs		472			58			588			1,425
Advertising		391			460			847			1,053
FDIC insurance		140			200			430			650
Intangible amortization		316			332			948			995
Core processing charges		860			925			2,318			2,720
Telephone and data		117			182			394			733
Other operating expenses		2,051			2,021			6,262			6,413
TOTAL NONINTEREST EXPENSES		17,128			17,470			51,566			53,386
INCOME BEFORE INCOME TAXES		19,369			13,312			55,904			36,564
INCOME TAXES		3,358			2,443			9,762			6,045
NET INCOME	$	16,011		$	10,869		$	46,142		$	30,519
EARNINGS PER SHARE - basic	$	0.57		$	0.39		$	1.63		$	1.08
EARNINGS PER SHARE - fully diluted	$	0.56		$	0.38		$	1.63		$	1.07

See accompanying notes

3

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

FARMERS NATIONAL BANC CORP. AND SUBSIDIARIES

	(In Thousands of Dollars)
	For the Three Months Ended						For the Nine Months Ended
(Unaudited)	September 30, 2021			September 30, 2020			September 30, 2021			September 30, 2020
NET INCOME	$	16,011		$	10,869		$	46,142		$	30,519
Other comprehensive income:
Net unrealized holding gains (losses) on available for sale securities		(2,754	)		700			(8,990	)		13,894
Reclassification adjustment for (gains) realized in income		(464	)		(48	)		(848	)		(318	)
Net unrealized holding gains		(3,218	)		652			(9,838	)		13,576
Income tax effect		674			(138	)		2,066			(2,852	)
Other comprehensive income (loss), net of tax		(2,544	)		514			(7,772	)		10,724
TOTAL COMPREHENSIVE INCOME	$	13,467		$	11,383		$	38,370		$	41,243

See accompanying notes

4

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

FARMERS NATIONAL BANC CORP. AND SUBSIDIARIES

	(In Thousands of Dollars)
	For the Three Months Ended
(Unaudited)	September 30, 2021			September 30, 2020
COMMON STOCK
Beginning balance	$	208,312		$	208,390
Issued 2,445 treasury shares in 2021 and 6,439 treasury shares in 2020 under the Long Term Incentive Plan		(51	)		(110	)
Stock compensation expense for unvested shares		278			364
Ending balance		208,539			208,644
RETAINED EARNINGS
Beginning balance		160,042			122,061
Net income		16,011			10,869
Dividends paid at $0.11 per share in 2021 and 2020		(3,114	)		(3,112	)
Ending balance		172,939			129,818
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)
Beginning balance		16,804			20,036
Other comprehensive income (loss)		(2,544	)		514
Ending balance		14,260			20,550
TREASURY STOCK, AT COST
Beginning balance		(18,250	)		(19,135	)
Issued 3,499 shares in 2021 and 8,000 shares in 2020 under the Long Term Incentive Plan		51			110
Retained 1,054 shares in 2021 and 1,561 shares in 2020 to cover tax withholdings under the Long Term Incentive Plan		(15	)		(19	)
Ending balance		(18,214	)		(19,044	)
TOTAL STOCKHOLDERS' EQUITY	$	377,524		$	339,968

5

	(In Thousands of Dollars)
	For the Nine Months Ended
(Unaudited)	September 30, 2021			September 30, 2020
COMMON STOCK
Beginning balance	$	208,763		$	186,345
Issued 74,522 treasury shares in 2021 and 60,242 treasury shares in 2020 under the Long Term Incentive Plan		(1,089	)		(1,305	)
Issued 1,398,229 shares in 2020 as part of a business combination		0			22,554
Stock compensation expense for unvested shares		865			1,050
Ending balance		208,539			208,644
RETAINED EARNINGS
Beginning balance		138,073			108,851
Net income		46,142			30,519
Cumulative impact of ASU 2016-13 adoption (CECL)		(1,936	)		0
Dividends paid at $0.33 per share in 2021 and 2020		(9,340	)		(9,552	)
Ending balance		172,939			129,818
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)
Beginning balance		22,032			9,826
Other comprehensive income (loss)		(7,772	)		10,724
Ending balance		14,260			20,550
TREASURY STOCK, AT COST
Beginning balance		(18,771	)		(5,713	)
Purchased 8,120 shares in 2021 and 942,967 shares in 2020		(116	)		(14,238	)
Issued 106,102 shares in 2021 and 95,389 shares in 2020 under the Long Term Incentive Plan		1,089			1,305
Retained 31,580 shares in 2021 and 35,147 shares in 2020 to cover tax withholdings under the Long Term Incentive Plan		(416	)		(398	)
Ending balance		(18,214	)		(19,044	)
TOTAL STOCKHOLDERS' EQUITY	$	377,524		$	339,968

See accompanying notes.

6

CONSOLIDATED STATEMENTS OF CASH FLOWS

FARMERS NATIONAL BANC CORP. AND SUBSIDIARIES

	(In Thousands of Dollars)
	Nine Months Ended
(Unaudited)	September 30, 2021			September 30, 2020
CASH FLOWS FROM OPERATING ACTIVITIES
Net income	$	46,142		$	30,519
Adjustments to reconcile net income to net cash from operating activities:
Provision (credit) for credit losses		(472	)		6,100
Provision (credit) for unfunded loans		(1	)		0
Depreciation and amortization		2,429			2,317
Net amortization of securities		2,254			1,782
Available for sale security gain		(838	)		(318	)
Realized (gains) losses on equity securities		(141	)		117
Loss on premises and equipment sales and disposals, net		52			77
Stock compensation expense		865			1,050
Loss on adjustment of other real estate owned		0			4
Earnings on bank owned life insurance		(884	)		(608	)
Income recognized from death benefit on bank owned life insurance		(40	)		0
Origination of loans held for sale		(236,319	)		(180,876	)
Proceeds from loans held for sale		244,876			184,772
Net gains on sale of loans		(6,557	)		(7,754	)
Net change in other assets and liabilities		(11,409	)		(10,493	)
NET CASH FROM OPERATING ACTIVITIES		39,957			26,689
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from maturities and repayments of securities available for sale		48,681			37,371
Proceeds from sales of securities available for sale		35,176			17,664
Purchases of securities available for sale		(702,871	)		(61,450	)
Proceeds from sales of equity securities		87			54
Purchase of equity securities		(48	)		(868	)
Proceeds from maturities and repayments of SBIC funds		1,103			0
Purchases of SBIC funds		(784	)		0
Proceeds from redemption of restricted stock		2,145			5,061
Purchase of restricted stock		(22	)		(2,843	)
Loan originations and payments, net		185,293			(155,658	)
Proceeds from sale of other real estate owned		0			126
Proceeds from BOLI death benefit		352			0
Proceeds from land and building sales		0			502
Additions to premises and equipment		(460	)		(3,623	)
Net cash paid in business combinations		0			(8,136	)
NET CASH FROM INVESTING ACTIVITIES		(431,348	)		(171,800	)
CASH FLOWS FROM FINANCING ACTIVITIES
Net change in deposits		255,535			346,117
Net change in short-term borrowings		(2,521	)		(46,858	)
Repayment of long-term borrowings		(26,980	)		(1,779	)
Cash dividends paid		(9,340	)		(9,316	)
Repurchase of common shares		(116	)		(14,238	)
NET CASH FROM FINANCING ACTIVITIES		216,578			273,926
NET CHANGE IN CASH AND CASH EQUIVALENTS		(174,813	)		128,815
Beginning cash and cash equivalents		254,621			70,760
Ending cash and cash equivalents	$	79,808		$	199,575
Supplemental cash flow information:
Interest paid	$	6,782		$	13,367
Income taxes paid	$	9,400		$	7,200
Supplemental noncash disclosures:
Transfer of loans to other real estate	$	0		$	73
Security purchases not settled	$	0		$	2,466
Issuance of stock awards	$	1,089		$	1,305
Issuance of stock for business combinations	$	0		$	22,554

See accompanying notes

7

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

Principles of Consolidation:

Farmers National Banc Corp. (“Company”) is a Financial Holding Company registered under the Bank Holding Company Act of 1956, as amended.  The Company provides full banking services through its nationally chartered subsidiary, The Farmers National Bank of Canfield (“Bank”).  The consolidated financial statements also include the accounts of the Bank’s subsidiaries; Farmers National Insurance, LLC (“Insurance”) and Farmers of Canfield Investment Co. (“Investments”).  The Company provides trust and retirement consulting services through its subsidiary, Farmers Trust Company (“Trust”), and insurance services through the Bank’s subsidiary, Insurance.  Farmers National Captive, Inc. (“Captive”) is a wholly-owned insurance subsidiary of the Company that provides property and casualty insurance coverage to the Company and its subsidiaries.  The Captive pools resources with eleven other similar insurance company subsidiaries of financial institutions to spread a limited amount of risk among themselves and to provide insurance where not currently available or economically feasible in today’s insurance market place.  The consolidated financial statements include the accounts of the Company, the Bank and its subsidiaries, along with the Trust and Captive.  All significant intercompany balances and transactions have been eliminated in the consolidation.

Basis of Presentation:

The unaudited condensed consolidated financial statements have been prepared in conformity with the instructions to Form 10-Q and Article 10 of Regulation S-X.  Accordingly, they do not include all of the information and footnotes required by U.S. generally accepted accounting principles (“U.S. GAAP”) for complete financial statements.  The financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s 2020 Annual Report to Shareholders included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020 (“2020 Form 10-K”).  The interim consolidated financial statements include all adjustments (consisting of only normal recurring items) that, in the opinion of management, are necessary for a fair presentation of the financial position and results of operations for the periods presented.  The results of operations for the interim periods disclosed herein are not necessarily indicative of the results that may be expected for a full year.  Certain items included in the prior period financial statements were reclassified to conform to the current period presentation. There was no effect on net income or total stockholders’ equity.

Estimates:

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.  Actual results could differ from those estimates.

Segments:

The Company provides a broad range of financial services to individuals and companies in northeastern Ohio and western Pennsylvania.  Operations are managed and financial performance is primarily aggregated and reported in two lines of business, the Bank segment and the Trust segment.

Equity:

There are 50,000,000 shares authorized and available for issuance as of September 30, 2021.  Outstanding shares at September 30, 2021 were 28,321,581.

Comprehensive Income:

Comprehensive income consists of net income and other comprehensive income.  Other comprehensive income consists of unrealized gains and losses on securities available for sale which are recognized as components of stockholders’ equity, net of tax effect.

Updates to Significant Accounting Policies:

Allowance for Credit Losses – Available-for-Sale Securities:  

Securities classified as AFS are those securities that the Company intends to hold for an indefinite period of time, but not necessarily to maturity.  Any decision to sell a security classified as AFS would be based on various factors, including significant movements in interest rates, changes in the maturity mix of the Company’s assets and liabilities, liquidity needs, regulatory capital considerations, and other similar factors.

8

The Company evaluates AFS securities that are in an unrealized loss position on a quarterly basis to determine whether the decline in fair value below the amortized costs basis is due to credit-related factors or noncredit-related factors.  In making this evaluation, management considers the extent to which the fair value has been less than cost, the financial condition and near-term prospects of the issuer, and the intent and ability of the Company to hold the security for a period of time sufficient to allow for any anticipated recovery in fair value.  Any impairment that is not credit-related is recognized in other comprehensive income, net of related deferred income taxes.  Credit-related impairment is recognized as an allowance for credit losses (“ACL”) on the balance sheet based on the amount by which the amortized cost basis exceeds the fair value, with a corresponding charge to net income.  Both the ACL and the charge to net income may be reversed if conditions change.  However, if the Company intends to sell an impaired AFS security or more likely than not will be required to sell such a security before recovering its amortized cost basis, the entire impairment amount must be recognized in net income with a corresponding adjustment to the security’s amortized cost basis rather than through the establishment of an ACL.  The Company has recorded no ACL related to the investment portfolio as of September 30, 2021.

Allowance for Credit Losses – Loans:  

The ACL represents management’s estimate of expected credit losses in the Company’s loan portfolio at the balance sheet date.  The Company estimates the ACL based on the amortized cost basis of the underlying loan and has made an accounting policy election to exclude accrued interest from the loan’s amortized cost basis and the related measurement of the ACL.  Estimating the amount of the ACL is a function of a number of factors, including but not limited to changes in the loan portfolio, net charge-offs, trends in past due and nonaccrual loans, and the level of potential problem loans, all of which may be susceptible to significant change.

Prior to January 1, 2021, as described in further detail in the Company’s 2020 Form 10-K, the Company used an incurred loss impairment model.  This methodology assessed the overall appropriateness of the allowance for credit losses and included allocations for specifically identified impaired loans and loss factors for all remaining loans, with a component primarily based on historical loss rates and another component primarily based on other qualitative factors.  Impaired loans were individually assessed and measured based on the present value of expected future cash flows discounted at the loan’s effective interest rate, the loan’s observable market price or the fair value of the collateral if the loan was collateral dependent.  Loans that were determined not to be impaired were collectively evaluated for impairment, stratified by type and allocated loss ranges based on the Company’s actual historical loss ratios for each strata, and adjustments were also provided for certain environmental and other qualitative factors.

On January 1, 2021, the Company adopted the current expected credit loss model (“CECL”).  This methodology for calculating the allowance for credit losses considers the possibility of loss over the life of the loan.  It also considers historical loss rates and other qualitative adjustments, as well as a new forward-looking component that considers reasonable and supportable forecasts over the expected life of each loan.  To develop the ACL estimate under the current expected loss model, the Company segments the loan portfolio into loan pools based on loan type and similar credit risk elements.  The Company uses the cohort (“cohort”) and the probability of default/loss given default (“PD/LGD”) methodologies as described in the Credit Quality Indicators section of the loan footnote. Under ASC 326, if a loan does not share similar risk characteristics with loans in that pool, expected credit losses for that loan are evaluated individually.  The Bank has established specific thresholds for the loan portfolio that trigger when loans need to be evaluated individually.    

In addition, ASC Topic 326 requires the Company to establish a separate liability for anticipated credit losses for unfunded commitments.  The Company previously included this reserve in the ACL but it is now recorded as a reserve in other liabilities.  As of September 30, 2021 the balance was $437 thousand.

Risks and Uncertainties:

The outbreak of COVID-19 has adversely impacted a broad range of industries in which the Company’s customers operate and could impair their ability to fulfill their financial obligations to the Company.  In addition, it has caused disruptions in the economy and has disrupted banking and other financial activity in the areas in which the Company operates, including but not limited to the current interest rate environment, increased inflation pressure, borrower and counterparty credit quality and market volatility.  While there has been no material impact to the Company’s business continuity or financial condition, the possibility of future challenges relating to COVID-19 remains.  

Congress, the President, and the Federal Reserve have taken several actions designed to cushion the economic fallout.  Most notably, the Coronavirus Aid, Relief and Economic Security Act (“CARES”) and the Health and Economic Recovery Omnibus Emergency Solutions Act (“HEROES”), both signed into law during 2020, were multi trillion dollar legislative packages, and the American Rescue Plan Act (“American Rescue Plan”) signed into law on March 11, 2021, was a $1.9 trillion COVID-19 relief bill.  The goal of these acts was to provide economic stability during the pandemic through various measures, including direct financial aid to American families and economic stimulus to significantly impacted industry sectors.  The packages also included extensive emergency funding for hospitals and providers. The American Rescue Plan continued these measures by funding increases in vaccine distribution, additional cash payments to millions of Americans, extended unemployment benefits, and support for caregiving, nutrition programs, health care and pensions.  In addition to the general impact of COVID-19, certain provisions of these legislative acts, as well as other recent legislative and regulatory relief efforts, have had a material impact on the Company’s operations.

9

The Company’s business is dependent upon the willingness and ability of its employees and customers to conduct banking and other financial transactions.  If the global response to contain COVID-19, and any new variants, continues for an extended period or is ultimately unsuccessful, the Company could experience a material adverse effect on its business, financial condition, results of operations and cash flows.  While it is not possible to know the full universe or extent that the impact of COVID-19 will have on the Company’s operations, the Company will disclose potentially material items of which it becomes aware.

Financial position and results of operations:

A majority of the Company’s fee income declined and could be reduced further due to lingering COVID-19 affects.  In keeping with guidance from regulators, the Company worked with COVID-19 affected customers to waive fees from a variety of sources, such as, but not limited to, insufficient funds and overdraft fees, ATM fees, account maintenance fees.  From the beginning of the pandemic in 2020 through the quarter ended September 30, 2021, the Company has waived $780 thousand in fees.  The Company recognizes that the breadth of the economic impact is likely to continue impacting its fee income in future periods.

The Company’s interest income improved in the quarter ended September 30, 2021, compared to the same period in 2020 and yet the net interest margin decreased by 8 basis points.  The margin could be reduced further due to COVID-19 and the continued low interest rate environment.  In keeping with guidance from regulators, the Company worked with COVID-19 affected borrowers to defer their payments.  Currently the Bank has one loan remaining that is deferring its loan payment.  While interest and fees will still accrue to income, through normal GAAP accounting, should eventual credit losses on these deferred payments emerge, interest income and fees accrued would need to be reversed.  In such a scenario, interest income in future periods could be negatively impacted.  At this time, the Company is unable to project the materiality of such an impact, but recognizes the breadth of the economic impact may affect its borrowers’ ability to repay in future periods.

Capital and liquidity:

While the Company believes that it has sufficient capital to withstand an extended economic recession brought about by COVID-19, its reported and regulatory capital ratios could be adversely impacted by further credit losses.  The Company relies on cash on hand as well as dividends from its subsidiaries.  If the Company’s capital deteriorates such that the Bank is unable to pay dividends to it for an extended period of time, the Company may not be able to pay dividends to shareholders.

The Company maintains access to multiple sources of liquidity.  Wholesale funding markets have remained open.  Rates for short term funding have recently been low but if funding costs are elevated for an extended period of time, it could have an adverse effect on the Company’s net interest margin.  If an extended recession caused large numbers of the Company’s deposit customers to withdraw their funds, the Company might become more reliant on volatile or more expensive sources of funding.

New Accounting Standards:

In June 2016, the FASB issued ASU 2016-13: Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (modified by ASU 2019-04, Codification Improvements to Topic 326, Financial Instruments Credit Losses).  The ASU requires an organization to measure all expected credit losses for financial assets held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts.  Financial institutions and other organizations will now use forward-looking information to better inform their credit loss estimates.  Many of the loss estimation techniques applied today will still be permitted, although the inputs to those techniques changed to reflect the full amount of expected credit losses.  Organizations will continue to use judgment to determine which loss estimation method is appropriate for their circumstances.  Additionally, the ASU amends the accounting for credit losses on available for sale debt securities and purchased financial assets with credit deterioration.  ASU 2016-13 is effective for public companies for annual periods beginning after December 15, 2019.  Entities will apply the standard’s provisions as a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is adopted.

In accordance with the accounting relief provisions of CARES and subsequent provisions of HEROES, the Bank postponed the adoption of the current expected credit losses (“CECL”) accounting standard from January 1, 2020 to January 1, 2021.  The Company adopted ASC 326 using the modified retrospective method for all financial assets measured at amortized cost and off-balance-sheet credit exposures.  Results for reporting periods beginning after January 1, 2021 are presented under ASC 326 while prior period amounts continue to be reported in accordance with previously applicable GAAP.  The Company recorded the onetime adjustment to equity in the amount of $1.9 million, net of tax which increased the allowance for credit losses $2.5 million.

10

Business Combinations:

On November 1, 2021, the Company completed the merger with Cortland Bancorp Inc. (“Cortland”), the parent company of The Cortland Savings and Banking Company (“Cortland Bank”), pursuant to the Agreement and Plan of Merger, dated as of June 22, 2021, as amended by that certain Amendment to Agreement and Plan of Merger, dated October 12, 2021 (collectively, the “Merger Agreement”), by and among the Company, Cortland, and FMNB Merger Subsidiary IV, LLC, a wholly-owned subsidiary of the Company (“Merger Sub”).  Pursuant to the terms of the Merger Agreement, on November 1, 2021, Cortland merged with and into Merger Sub (the “Merger”), with Merger Sub as the surviving entity in the Merger.  Promptly following the consummation of the Merger, Merger Sub was dissolved and liquidated and Cortland Bank merged with and into the Bank (the “Bank Merger”), with the Bank as the surviving bank in the Bank Merger.  The transaction received the approval of Cortland’s shareholders and all customary regulatory approvals.  Pursuant to the terms of the Merger Agreement, at the effective time of the Merger, each common share, without par value, of Cortland issued and outstanding immediately prior to the effective time (except for certain Cortland common shares held directly by Cortland or the Company) was converted into the right to receive, without interest, $28.00 per share in cash or 1.75 shares of the Company’s common stock, subject to an overall limitation of 75% of the Cortland shares being exchanged for the Company’s shares and the remaining 25% being exchanged for cash.

As of September 30, 2021, Cortland had total assets of $799.2 million, which included gross loans of $500.0 million, deposits of $693.0 million and equity of $83.0 million.  Cortland Bank has branches located in Trumbull, Mahoning, Portage, Summit and Cuyahoga Counties in Ohio.

On January 7, 2020, the Company completed the acquisition of Maple Leaf Financial, Inc. (“Maple Leaf”), the parent company of Geauga Savings Bank, with branches located in Cuyahoga and Geauga Counties in Ohio.  The Company is experiencing increased synergies and cost savings resulting from the combination of the two companies.  The transaction involved both cash and 1,398,229 shares of stock totaling $43.0 million.  Pursuant to the terms of the Merger Agreement, common shareholders of Maple Leaf had the right to receive $640.00 in cash or 45.5948 common shares, without par value, of the Company.  Holders of outstanding and unexercised warrants to purchase Maple Leaf Common Shares received an amount in cash equal to the excess of $640.00 over $370.00, the exercise price of such warrants.

Goodwill of $7.6 million, which is recorded on the balance sheet, arising from the acquisition consisted largely of synergies and the cost savings resulting from the combining of the entities.  The goodwill was determined not to be deductible for income tax purposes.  

The following table summarizes the consideration paid for Maple Leaf and the amounts of the assets acquired and liabilities assumed on the closing date of the acquisition.

(In Thousands of Dollars)
Consideration
Cash	$	20,423
Stock		22,554
Fair value of total consideration transferred	$	42,977
Fair value of assets acquired
Cash and due from financial institutions	$	18,219
Securities available for sale		69,547
Loans		181,280
Premises and equipment		229
Core deposit intangible		725
Other assets		6,398
Total assets		276,398
Fair value of liabilities assumed
Deposits		183,251
Long-term borrowings		54,487
Accrued interest payable and other liabilities		3,257
Total liabilities	$	240,995
Net assets acquired		35,403
Goodwill created		7,574
Total net assets acquired	$	42,977

11

The following table presents pro forma information as if the Maple Leaf acquisition that occurred during January 2020 actually took place at the beginning of 2020.  The pro forma information includes adjustments for merger related costs, amortization of intangibles arising from the transaction and the related income tax effects.  The pro forma financial information is not necessarily indicative of the results of operations that would have occurred had the transactions been effective on the assumed date.

(In thousands of dollars except per share results)	For Nine Months Ended Sept. 30, 2020
Net interest income	$	70,568
Net income	$	30,539
Basic earnings per share	$	1.08
Diluted earnings per share	$	1.07

Securities:

The following table summarizes the amortized cost and fair value of the available for sale investment securities portfolio at September 30, 2021 and December 31, 2020 and the corresponding amounts of unrealized gains and losses recognized in accumulated other comprehensive income:

			Gross		Gross
	Amortized		Unrealized		Unrealized
(In Thousands of Dollars)	Cost		Gains		Losses			Fair Value
September 30, 2021
U.S. Treasury and U.S. government sponsored entities	$	89,919	$	53	$	(1,502	)	$	88,470
State and political subdivisions		485,125		22,776		(618	)		507,283
Corporate bonds		3,604		77		(14	)		3,667
Mortgage-backed securities - residential		569,235		2,778		(5,909	)		566,104
Collateralized mortgage obligations - residential		12,956		290		(5	)		13,241
Small Business Administration		4,471		125		0			4,596
Totals	$	1,165,310	$	26,099	$	(8,048	)	$	1,183,361

			Gross		Gross
	Amortized		Unrealized		Unrealized
(In Thousands of Dollars)	Cost		Gains		Losses			Fair Value
December 31, 2020
U.S. Treasury and U.S. government sponsored entities	$	11,798	$	101	$	(54	)	$	11,845
State and political subdivisions		344,160		22,350		(204	)		366,306
Corporate bonds		3,582		132		(2	)		3,712
Mortgage-backed securities - residential		157,106		4,919		(243	)		161,782
Collateralized mortgage obligations - residential		25,654		742		(3	)		26,393
Small Business Administration		5,411		151		0			5,562
Totals	$	547,711	$	28,395	$	(506	)	$	575,600

Proceeds from the sale of portfolio securities were $8.2 million and $35.2 million during the three and nine month periods ended September 30, 2021, respectively.  Gross gains of $458 thousand and $1.4 million along with gross losses of $1 thousand and $515 thousand were realized on these sales during the three and nine month periods ended September 30, 2021.  $5 thousand and $141 thousand of realized gains, for equity securities, were recognized in the income statement during the three and nine month periods ended September 30, 2021, respectively.

Proceeds from the sale of portfolio securities were $2.3 million during the three month and $17.7 million during the nine month periods ended September 30, 2020.  Gross gains were $48 thousand and $330 thousand for the three and nine month periods ended September 30, 2020, respectively.  There were $0 gross losses for the three month period and $12 thousand of realized losses for the nine month period ended September 30, 2020. $22 thousand of realized gains and $117 thousand of realized losses, related to equity securities, were recognized in income during the three and nine month periods ended September 30, 2020, respectively.

12

The amortized cost and fair value of the debt securities portfolio are shown by expected maturity.  Expected maturities may differ from contractual maturities if issuers have the right to call or prepay obligations with or without call or prepayment penalties. Securities not due at a single maturity date are shown separately.

	September 30, 2021
(In Thousands of Dollars)	Amortized Cost		Fair Value
Maturity
Within one year	$	3,791	$	3,820
One to five years		10,360		10,967
Five to ten years		125,179		125,944
Beyond ten years		439,318		458,689
Mortgage-backed, collateralized mortgage obligations and Small Business Administration securities		586,662		583,941
Total	$	1,165,310	$	1,183,361

The following table summarizes the available for sale investment securities with unrealized losses at September 30, 2021 and December 31, 2020, aggregated by major security type and length of time in a continuous unrealized loss position.   

	Less than 12 Months					12 Months or Longer					Total
	Fair		Unrealized			Fair		Unrealized			Fair		Unrealized
(In Thousands of Dollars)	Value		Loss			Value		Loss			Value		Loss
September 30, 2021
U.S. Treasury and U.S. government sponsored entities	$	84,849	$	(1,479	)	$	627	$	(23	)	$	85,476	$	(1,502	)
State and political subdivisions		64,442		(562	)		4,579		(56	)		69,021		(618	)
Corporate bonds		533		(11	)		197		(3	)		730		(14	)
Mortgage-backed securities - residential		390,783		(5,909	)		10		0			390,793		(5,909	)
Collateralized mortgage obligations - residential		1,419		(2	)		249		(3	)		1,668		(5	)
Total	$	542,026	$	(7,963	)	$	5,662	$	(85	)	$	547,688	$	(8,048	)

	Less than 12 Months					12 Months or Longer				Total
	Fair		Unrealized			Fair		Unrealized		Fair		Unrealized
(In Thousands of Dollars)	Value		Loss			Value		Loss		Value		Loss
December 31, 2020
U.S. Treasury and U.S. government sponsored entities	$	8,153	$	(54	)	$	0	$	0	$	8,153	$	(54	)
State and political subdivisions		19,205		(204	)		0		0		19,205		(204	)
Corporate bonds		198		(2	)		0		0		198		(2	)
Mortgage-backed securities - residential		63,401		(243	)		0		0		63,401		(243	)
Collateralized mortgage obligations - residential		294		(3	)		0		0		294		(3	)
Total	$	91,251	$	(506	)	$	0	$	0	$	91,251	$	(506	)

Allowance for Credit Losses

The Company has adopted ASU 2016-13 that makes improvements to the accounting for credit losses on securities available for sale.  The concept of other than-temporarily impaired securities has been replaced with the allowance for credit losses.  Securities available for sale are evaluated on an individual level and pooling of securities is no longer an option.  During this evaluation process, management considers the extent to which the fair value has been less than cost, the financial condition and near term prospects of the issuer, and the intent and ability of the Company to hold the security for a period of time sufficient to allow for any anticipated recovery in fair value.      

If the Company determines that a credit loss exists, the credit portion of the allowance will be measured using a discounted cash flow analysis using the effective interest rate as of the security’s purchase date.  As of September 30, 2021, the Company’s security portfolio consisted of 718 securities, 146 of which were in an unrealized loss position.  The majority of the unrealized losses on the Company’s securities are related to its holdings of U.S. Treasury and U.S. government sponsored entities and mortgage-backed securities.  The Company does not consider its AFS securities with unrealized losses to be attributable to credit-related factors, as the

13

unrealized losses have occurred as a result of changes in noncredit related factors such as changes in interest rates, market spreads and market conditions subsequent to purchase, not credit deterioration.  As of September 30, 2021 the Company has not recorded an allowance for credit losses on AFS securities.

Loans:

Acquired loans were transferred and are included in originated loans at period ended September 30, 2021.  This is to align with the calculation of the allowance for credit losses being used under the CECL model.  Loan balances were as follows:

(In Thousands of Dollars)	September 30, 2021			December 31, 2020
Originated loans:
Commercial real estate
Owner occupied	$	260,556		$	215,187
Non-owner occupied		351,407			309,777
Farmland		176,190			156,277
Other		78,444			78,140
Commercial
Commercial and industrial		302,356			385,831
Agricultural		50,707			44,922
Residential real estate
1-4 family residential		376,901			324,723
Home equity lines of credit		106,750			92,968
Consumer
Indirect		158,617			164,620
Direct		21,520			23,348
Other		9,359			9,868
Total originated loans	$	1,892,807		$	1,805,661
Acquired loans:
Commercial real estate
Owner occupied	$	0		$	45,101
Non-owner occupied		0			52,863
Farmland		0			26,080
Other		0			12,868
Commercial
Commercial and industrial		0			18,662
Agricultural		0			4,850
Residential real estate
1-4 family residential		0			89,118
Home equity lines of credit		0			17,383
Consumer
Direct		0			5,128
Other		0			97
Total acquired loans	$	0		$	272,150
Net Deferred loan (fees) costs		1,409			233
Allowance for credit losses		(23,136	)		(22,144	)
Net loans	$	1,871,080		$	2,055,900

14

Allowance for credit loss activity

The following tables present the activity in the allowance for credit losses by portfolio segment for the three and nine month periods ended September 30, 2021 and the activity in the allowance for loan losses by portfolio segment for the three and nine month periods ended September 30, 2020:

Three Months Ended September 30, 2021

(In Thousands of Dollars)	Commercial Real Estate			Commercial			Residential Real Estate			Consumer			Total
Allowance for credit losses
Beginning balance	$	12,290		$	4,600		$	4,130		$	3,786		$	24,806
Adjustment related to reserve for unfunded loan reclass	$	(245	)	$	(104	)	$	(73	)	$	(15	)		(437	)
Provision for credit losses		(454	)		(655	)		75			87			(947	)
Loans charged off		(31	)		(126	)		(55	)		(199	)		(411	)
Recoveries		1			15			41			68			125
Total ending allowance balance	$	11,561		$	3,730		$	4,118		$	3,727		$	23,136

Nine Months Ended September 30, 2021

(In Thousands of Dollars)	Commercial Real Estate			Commercial			Residential Real Estate			Consumer			Total
Allowance for credit losses
Beginning balance	$	10,824		$	5,073		$	3,643		$	2,604		$	22,144
Adjustment related to reserve for unfunded loan reclass		(245	)		(104	)		(73	)		(15	)		(437	)
Impact of CECL adoption		(2,076	)		429			237			3,860			2,450
Provision for credit losses		3,077			(1,668	)		411			(2,292	)		(472	)
Loans charged off		(51	)		(198	)		(221	)		(727	)		(1,197	)
Recoveries		32			198			121			297			648
Total ending allowance balance	$	11,561		$	3,730		$	4,118		$	3,727		$	23,136

Three Months Ended September 30, 2020

(In Thousands of Dollars)	Commercial Real Estate			Commercial			Residential Real Estate			Consumer			Total
Allowance for credit losses
Beginning balance	$	7,972		$	3,293		$	2,991		$	2,704		$	16,960
Provision for credit losses		1,052			1,090			414			44			2,600
Loans charged off		(20	)		(92	)		(22	)		(259	)		(393	)
Recoveries		2			1			14			157			174
Total ending allowance balance	$	9,006		$	4,292		$	3,397		$	2,646		$	19,341

15

Nine Months Ended September 30, 2020

(In Thousands of Dollars)	Commercial Real Estate			Commercial			Residential Real Estate			Consumer			Total
Allowance for credit losses
Beginning balance	$	6,156		$	2,447		$	3,029		$	2,855		$	14,487
Provision for credit losses		2,961			2,176			490			473			6,100
Loans charged off		(117	)		(340	)		(163	)		(1,046	)		(1,666	)
Recoveries		6			9			41			364			420
Total ending allowance balance	$	9,006		$	4,292		$	3,397		$	2,646		$	19,341

The following table presents the recorded investment in nonaccrual and loans past due 90 days or more still on accrual by class of loans as of September 30, 2021 and December 31, 2020:

	September 30, 2021				December 31, 2020
(In Thousands of Dollars)	Nonaccrual		Loans Past Due 90 Days or More Still Accruing		Nonaccrual		Loans Past Due 90 Days or More Still Accruing
Originated loans:
Commercial real estate
Owner occupied	$	452	$	0	$	0	$	335
Non-owner occupied		2,627		0		0		0
Farmland		277		0		0		0
Commercial
Commercial and industrial		5,177		3		3,312		22
Agricultural		34		0		205		0
Residential real estate
1-4 family residential		3,960		466		866		223
Home equity lines of credit		718		137		603		0
Consumer
Indirect		462		101		648		64
Direct		261		69		157		111
Other		0		0		1		5
Total originated loans	$	13,968	$	776	$	5,792	$	760
Acquired loans:
Commercial real estate
Owner occupied	$	0	$	0	$	27	$	0
Non-owner occupied		0		0		362		0
Farmland		0		0		471		95
Commercial
Commercial and industrial		0		0		477		0
Agricultural		0		0		4		0
Residential real estate
1-4 family residential		0		0		4,128		1,469
Home equity lines of credit		0		0		186		0
Consumer
Direct		0		0		58		6
Total acquired loans	$	0	$	0	$	5,713	$	1,570
Total loans	$	13,968	$	776	$	11,505	$	2,330

16

The following tables present the aging of the recorded investment in past due loans as of September 30, 2021 and December 31, 2020 by class of loans.  Note that loans on a current modification to defer payments under the CARES Act are included in loans not past due.

(In Thousands of Dollars)	30-59 Days Past Due		60-89 Days Past Due		90 Days or More Past Due and Nonaccrual		Total Past Due		Loans Not Past Due		Total
September 30, 2021
Commercial real estate
Owner occupied	$	72	$	0	$	452	$	524	$	259,656	$	260,180
Non-owner occupied		0		0		2,627		2,627		348,267		350,894
Farmland		356		0		277		633		175,297		175,930
Other		0		0		0		0		78,217		78,217
Commercial
Commercial and industrial		112		358		5,180		5,650		294,434		300,084
Agricultural		87		9		34		130		50,756		50,886
Residential real estate
1-4 family residential		3,399		845		4,426		8,670		367,333		376,003
Home equity lines of credit		253		28		855		1,136		105,622		106,758
Consumer
Indirect		874		57		563		1,494		162,812		164,306
Direct		375		78		330		783		20,816		21,599
Other		33		8		0		41		9,318		9,359
Total loans	$	5,561	$	1,383	$	14,744	$	21,688	$	1,872,528	$	1,894,216

17

(In Thousands of Dollars)	30-59 Days Past Due		60-89 Days Past Due		90 Days or More Past Due and Nonaccrual		Total Past Due		Loans Not Past Due		Total
December 31, 2020
Originated loans:
Commercial real estate
Owner occupied	$	0	$	0	$	335	$	335	$	214,460	$	214,795
Non-owner occupied		0		0		0		0		309,216		309,216
Farmland		0		0		0		0		156,053		156,053
Other		261		0		0		261		77,725		77,986
Commercial
Commercial and industrial		356		61		3,334		3,751		378,594		382,345
Agricultural		45		255		205		505		44,555		45,060
Residential real estate
1-4 family residential		1,668		974		1,089		3,731		320,129		323,860
Home equity lines of credit		419		0		603		1,022		91,957		92,979
Consumer
Indirect		1,046		285		712		2,043		168,245		170,288
Direct		284		120		268		672		22,789		23,461
Other		24		22		6		52		9,816		9,868
Total originated loans	$	4,103	$	1,717	$	6,552	$	12,372	$	1,793,539	$	1,805,911
Acquired loans:
Commercial real estate
Owner occupied	$	0	$	0	$	27	$	27	$	45,072	$	45,099
Non-owner occupied		197		0		362		559		52,295		52,854
Farmland		0		0		566		566		25,513		26,079
Other		0		0		0		0		12,868		12,868
Commercial
Commercial and industrial		19		390		477		886		17,772		18,658
Agricultural		4		0		4		8		4,841		4,849
Residential real estate
1-4 family residential		1,954		821		5,597		8,372		80,745		89,117
Home equity lines of credit		23		0		186		209		17,175		17,384
Consumer
Direct		20		49		64		133		4,995		5,128
Other		0		0		0		0		97		97
Total acquired loans	$	2,217	$	1,260	$	7,283	$	10,760	$	261,373	$	272,133
Total loans	$	6,320	$	2,977	$	13,835	$	23,132	$	2,054,912	$	2,078,044

Troubled Debt Restructurings

Total troubled debt restructurings were $4.0 million and $4.1 million at September 30, 2021, and December 31, 2020.  The Company has allocated $109 thousand and $81 thousand of specific reserves to loans whose terms have been modified in troubled debt restructurings at September 30, 2021, and December 31, 2020, respectively.  There were no commitments to lend additional amounts to borrowers with loans that were classified as troubled debt restructurings at September 30, 2021, and at December 31, 2020.

18

During the three and nine month periods ended September 30, 2021 and 2020, the terms of certain loans were modified as troubled debt restructurings.  The modification of the terms of such loans included one or a combination of the following: a reduction of the stated interest rate of the loan; an extension of the maturity date at a stated rate of interest lower than the current market rate for new debt with similar risk; a deferral of principal, interest and/or escrow; or a legal concession.  During the three month period ended September 30, 2021, the terms of such loans included a reduction of the stated interest rate of the loan of 0.25% and an extension of the maturity date of 193 months.  During the same three month period in 2020, the terms of such loans included a reduction of the stated interest rate of the loan of 2.25% and an extension of the maturity date of 48 months.  During the nine month period ended September 30, 2021, the terms of such loans included a reduction of the stated interest rate of the loan in the range of 0.25% and 4.075% and extensions of the maturity dates on these and other troubled debt restructurings in the range of 22 days to 361 months.  During the same nine month period in 2020, the terms of such loans included a reduction of the stated interest rate of the loan in the range of 1.00% and 2.25% and an extensions of the maturity dates in the range of 48 to 183 months.

The following table presents loans by class modified as troubled debt restructurings that occurred during the three and nine month periods ended September 30, 2021 and 2020:

			Pre- Modification		Post- Modification
Three Months Ended September 30, 2021	Number of		Outstanding Recorded		Outstanding Recorded
(In Thousands of Dollars)	Loans		Investment		Investment
Residential real estate
1-4 family residential		2	$	215	$	233
Home equity lines of credit		1		103		103
Consumer
Indirect		5		30		30
Direct		1		10		10
Total loans		9	$	358	$	376

			Pre- Modification		Post- Modification
Nine Months Ended September 30, 2021	Number of		Outstanding Recorded		Outstanding Recorded
(In Thousands of Dollars)	Loans		Investment		Investment
Commercial		4	$	22	$	22
Residential real estate
1-4 family residential		6		426		414
Home equity lines of credit		5		201		201
Consumer
Indirect		12		121		121
Direct		3		16		16
Total loans		30	$	786	$	774

			Pre- Modification		Post- Modification
Three Months Ended September 30, 2020	Number of		Outstanding Recorded		Outstanding Recorded
(In Thousands of Dollars)	Loans		Investment		Investment
Originated loans:
Consumer
Indirect		2	$	3	$	3
Total originated loans		2	$	3	$	3
Acquired loans:
Residential real estate
1-4 family residential		1		60		64
Total acquired loans		1	$	60	$	64
Total loans		3	$	63	$	67

19

			Pre- Modification		Post- Modification
Nine Months Ended September 30, 2020	Number of		Outstanding Recorded		Outstanding Recorded
(In Thousands of Dollars)	Loans		Investment		Investment
Originated loans:
Commercial		1	$	21	$	21
Residential real estate
1-4 family residential		6		245		246
Home equity lines of credit		4		100		102
Consumer
Indirect		19		124		124
Other		1		15		15
Total originated loans		31	$	505	$	508
Acquired loans:
1-4 family residential		3		140		144
Total acquired loans		3	$	140	$	144
Total loans		34	$	645	$	652

There were $15 thousand and $91 thousand in charge offs during the three and nine month periods ended September 30, 2021, respectively. There was $15 thousand and $90 thousand increase to the provision for loan losses during the three and nine month periods ended September 30, 2021, respectively, as a result of outstanding troubled debt restructurings.  There were $33 thousand and $72 thousand in charge offs during the three and nine month periods ended September 30, 2020, respectively. There was a $33 thousand and a $72 thousand increase to the provision during the three and nine month period ended September 30, 2020, respectively, as a result of troubled debt restructurings.

There were two commercial loans, one residential loan, and one indirect loan for which there was a payment default within twelve months following the modification of the troubled debt restructuring during the three month and nine month period ended September 30, 2021.  There was one commercial loan past due at September 30, 2021.  There was no provision recorded as a result of the defaults during 2021.  A loan is considered to be in payment default once it is 30 days contractually past due under the modified terms.

There were two commercial farmland loans and one commercial loan for which there was a payment default within twelve months following the modification of the troubled debt restructuring during the three month and nine month periods ended September 30, 2020.  There was no provision recorded as a result of the defaults during 2020.  A loan is considered to be in payment default once it is 30 days contractually past due under the modified terms.    

The Company offered three month deferrals upon request by the borrowers. For those borrowers in industries that were greatly impacted by COVID-19, additional deferrals were considered and granted beyond the initial three month period. The range of deferred months for subsequent requests were three to twelve months. The decline in deferred loans and balances was due to borrowers not requesting additional deferments and most continued to pay under the original terms of their loan.   

Farmers is also a preferred U.S. Small Business Administration (“SBA”) lender and dedicated significant additional staff and other resources to help our customers complete and submit their applications and supporting documentation for loans offered under the Paycheck Protection Program (“PPP”) under the CARES Act, so they could obtain SBA approval and receive funding as quickly as possible. During the period of the PPP program, the Company facilitated PPP assistance to 1,714 business customers totaling $199.8 million.  The Company, on behalf of its customers, began processing borrower applications for PPP forgiveness at the beginning of September 2020.  The SBA has up to ninety days to review an application for PPP forgiveness and provide a decision at the end of that review.  Once forgiveness of the PPP loan has been communicated and payment is received from the SBA, the Company will record the cash received from the SBA, pay-off the loans based on the amount of forgiveness provided and accelerate the amount of net deferred loan fees/costs recognized for the portion of the PPP loans that are forgiven.  During the period ended September 30, 2021, the Company has received life to date payments from the SBA for forgiveness of loans totaling $198.4 million, or approximately 99.2% of the PPP loans originated in 2020. The Company has processed $84.0 million in new loans for PPP loan funding during 2021. The Company has also received payments from the SBA for forgiveness of loans totaling $29.2 million, or approximately 34.7%, of PPP loans originated in 2021.

20

Credit Quality Indicators

The Company categorizes loans into risk categories based on relevant information about the ability of borrowers to service their debt such as: current financial information, historical payment experience, credit documentation, public information, and current economic trends, among other factors.  The Company establishes a risk rating at origination for all commercial loan and commercial real estate relationships.  For relationships over $1 million, management monitors the loans on an ongoing basis for any changes in the borrower’s ability to service their debt.  Management also affirms the risk ratings for the loans in their respective portfolios on an annual basis.  The Company uses the following definitions for risk ratings:

Special Mention. Loans classified as special mention have a potential weakness that deserves management’s close attention.  If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or of the institution’s credit position at some future date.  Special mention assets are not adversely classified and do not expose an institution to sufficient risk to warrant adverse classification.

Substandard. Loans classified as substandard are inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged, if any.  Loans so classified have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt.  Substandard loans are characterized by the distinct possibility that the institution will sustain some loss if the deficiencies are not corrected.

Doubtful. Loans classified as doubtful have all the weaknesses inherent in those classified as substandard, with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions, and values, highly questionable and improbable.

Loans not meeting the criteria above that are analyzed individually as part of the above described process are considered to be pass rated loans.

As of September 30, 2021 and December 31, 2020, and based on the most recent analysis performed, the risk category of loans by class of loans is as follows:

(In Thousands of Dollars)	Pass		Special Mention		Sub standard		Total
September 30, 2021
Commercial real estate
Owner occupied	$	251,517	$	6,470	$	2,193	$	260,180
Non-owner occupied		326,515		14,500		9,879		350,894
Farmland		172,370		2,174		1,386		175,930
Other		77,304		773		140		78,217
Commercial
Commercial and industrial		291,700		536		7,848		300,084
Agricultural		50,268		521		97		50,886
Total loans	$	1,169,674	$	24,974	$	21,543	$	1,216,191

21

(In Thousands of Dollars)	Pass		Special Mention		Sub standard		Total
December 31, 2020
Originated loans:
Commercial real estate
Owner occupied	$	208,289	$	5,121	$	1,385	$	214,795
Non-owner occupied		290,773		11,240		7,203		309,216
Farmland		153,225		2,464		364		156,053
Other		77,432		387		167		77,986
Commercial
Commercial and industrial		372,083		1,522		8,740		382,345
Agricultural		44,527		320		213		45,060
Total originated loans	$	1,146,329	$	21,054	$	18,072	$	1,185,455
Acquired loans:
Commercial real estate
Owner occupied	$	44,031	$	87	$	981	$	45,099
Non-owner occupied		50,053		49		2,752		52,854
Farmland		24,637		100		1,342		26,079
Other		12,868		0		0		12,868
Commercial
Commercial and industrial		16,246		0		2,412		18,658
Agricultural		4,481		303		65		4,849
Total acquired loans	$	152,316	$	539	$	7,552	$	160,407
Total loans	$	1,298,645	$	21,593	$	25,624	$	1,345,862

The Company considers the performance of the loan portfolio and its impact on the allowance for credit losses.  For residential, consumer indirect and direct loan classes, the Company evaluates credit quality based on the aging status of the loan, which was previously presented, and by payment activity.  In the 1-4 family residential real estate portfolio at September 30, 2021, other real estate owned and foreclosure properties were $0 and $314 thousand, respectively.  At December 31, 2020, other real estate owned and foreclosure properties were $0 and $699 thousand, respectively.

The following tables present the recorded investment in residential, consumer indirect and direct auto loans based on payment activity as of September 30, 2021 and December 31, 2020.  Nonperforming loans are loans past due 90 days or more and still accruing interest and nonaccrual loans.

	Residential Real Estate				Consumer
(In Thousands of Dollars)	1-4 Family Residential		Home Equity Lines of Credit		Indirect		Direct		Other
September 30, 2021
Performing	$	371,577	$	105,903	$	163,743	$	21,269	$	9,359
Nonperforming		4,426		855		563		330		0
Total loans	$	376,003	$	106,758	$	164,306	$	21,599	$	9,359

22

	Residential Real Estate				Consumer
(In Thousands of Dollars)	1-4 Family Residential		Home Equity Lines of Credit		Indirect		Direct		Other
December 31, 2020
Originated loans:
Performing	$	322,771	$	92,376	$	169,576	$	23,193	$	9,862
Nonperforming		1,089		603		712		268		6
Total originated loans	$	323,860	$	92,979	$	170,288	$	23,461	$	9,868
Acquired loans:
Performing	$	83,520	$	17,198	$	0	$	5,064	$	97
Nonperforming		5,597		186		0		64		0
Total acquired loans		89,117		17,384		0		5,128		97
Total loans	$	412,977	$	110,363	$	170,288	$	28,589	$	9,965

23

The following table presents total loans by risk categories and year of origination.

	Term Loans Amortized Cost Basis by Origination Year
As of September 30, 2021	2021		2020		2019		2018		2017		Prior		Revolving Loans		Total
Commercial real estate
Risk Rating
Pass	$	79,167	$	103,241	$	128,436	$	93,100	$	65,831	$	169,999	$	15,562	$	655,336
Special mention		773		0		9,518		1,716		2,892		6,365		479		21,743
Substandard		0		327		2,284		502		90		8,888		121		12,212
Total commercial real estate loans	$	79,940	$	103,568	$	140,238	$	95,318	$	68,813	$	185,252	$	16,162	$	689,291
Commercial
Risk Rating
Pass	$	90,549	$	59,498	$	25,933	$	29,075	$	11,732	$	18,807	$	56,106	$	291,700
Special mention		220		106		87		0		0		0		123		536
Substandard		3,119		1,881		334		265		814		84		1,351		7,848
Total commercial loans	$	93,888	$	61,485	$	26,354	$	29,340	$	12,546	$	18,891	$	57,580	$	300,084
Agricultural
Risk Rating
Pass	$	30,585	$	54,038	$	30,248	$	31,198	$	20,075	$	38,288	$	18,206	$	222,638
Special mention		0		238		33		0		2,075		0		349		2,695
Substandard		356		21		66		13		0		997		30		1,483
Total agricultural loans	$	30,941	$	54,297	$	30,347	$	31,211	$	22,150	$	39,285	$	18,585	$	226,816
Residential real estate
Risk Rating
Pass	$	48,989	$	78,879	$	37,697	$	29,361	$	39,854	$	129,640	$	2,685	$	367,105
Special mention		0		0		0		0		0		0		0		0
Substandard		50		0		23		54		588		8,183		0		8,898
Total residential real estate loans	$	49,039	$	78,879	$	37,720	$	29,415	$	40,442	$	137,823	$	2,685	$	376,003
Home equity lines of credit
Risk Rating
Pass	$	146	$	0	$	0	$	0	$	99	$	1,213	$	103,502	$	104,960
Special mention		0		0		0		0		0		0		48		48
Substandard		0		0		20		74		77		1,357		222		1,750
Total home equity lines of credit	$	146	$	0	$	20	$	74	$	176	$	2,570	$	103,772	$	106,758
Consumer
Risk Rating
Pass	$	46,676	$	50,526	$	39,119	$	23,551	$	11,356	$	16,516	$	6,194	$	193,938
Special mention		0		0		0		0		0		0		0		0
Substandard		32		321		173		205		162		433		0		1,326
Total consumer loans	$	46,708	$	50,847	$	39,292	$	23,756	$	11,518	$	16,949	$	6,194	$	195,264

24

Allowance for Credit Losses

The Company adopted ASU 2016-13 to calculate the allowance for credit losses (“ACL”) which requires projecting credit losses over the lifetime of the credits.  The ACL is adjusted through the provision for credit losses and reduced by net charge offs of loans.  Although the Company has a diversified loan portfolio, the credit risk in the loan portfolio is largely influenced by general economic conditions and trends of the counties and markets in which the debtors operate, and the resulting impact on the operations of borrowers or on the value of any underlying collateral.

The credit loss estimation process involves procedures that consider the unique characteristics of the Company’s loan portfolio segments.  These segments are disaggregated into the loan pools for monitoring.  A model of risk characteristics, such as loss history and delinquency experience, trends in past due and non-performing loans, as well as existing economic conditions and supportable forecasts used to determine credit loss assumptions.

The Company uses two methodologies to analyze loan pools.  The cohort method (“cohort”) and the probability of default/loss given default (“PD/LGD”). Cohort relies on the creation of cohorts to capture loans that qualify for a particular segment, as of a point in time. Those loans are then tracked over their remaining lives to determine their loss experience.  The Company aggregates financial assets on the basis of similar risk characteristics when evaluating loans on a collective basis.  Those characteristics include, but aren’t limited to, internal or external credit score, risk ratings, financial asset, loan type, collateral type, size, effective interest rate, term, or geographical location.  The Company uses cohort primarily for consumer loan portfolios.

The probability of default (“PD”) portion of PD/LGD is defined by the Company as 90 days past due, placed on non-accrual, becomes a troubled debt restructuring or is partially, or wholly, charged-off.  Typically, a one-year time period is used to asses PD.  PD can be measured and applied using various risk criteria.  Risk rating is one common way to apply PDs.  Loss given default (“LGD”) is to determine the percentage of loss by facility or collateral type.  LGD estimates can sometimes be driven, or influenced, by product type, industry or geography.  The Company uses PD/LGD primarily for commercial loan portfolios.

Revenue from Contracts with Customers:

All material revenue from contracts with customers in the scope of ASC 606 is recognized within noninterest income.  The following table presents the Company’s noninterest income by revenue stream and reportable segment, net of eliminations, for the three and nine months ended September 30, 2021 and 2020.

(In Thousands of Dollars)	Trust Segment		Bank Segment		Totals
For Three Months Ended September 30, 2021
Service charges on deposit accounts	$	0	$	924	$	924
Debit card and EFT fees		0		1,128		1,128
Trust fees		2,335		0		2,335
Insurance agency commissions		0		799		799
Retirement plan consulting fees		334		0		334
Investment commissions		0		638		638
Other (outside the scope of ASC 606)		0		2,857		2,857
Total noninterest income	$	2,669	$	6,346	$	9,015

(In Thousands of Dollars)	Trust Segment		Bank Segment		Totals
For Three Months Ended September 30, 2020
Service charges on deposit accounts	$	0	$	904	$	904
Debit card and EFT fees		0		1,048		1,048
Trust fees		1,973		0		1,973
Insurance agency commissions		0		784		784
Retirement plan consulting fees		341		0		341
Investment commissions		0		353		353
Other (outside the scope of ASC 606)		0		3,814		3,814
Total noninterest income	$	2,314	$	6,903	$	9,217

25

(In Thousands of Dollars)	Trust Segment		Bank Segment		Totals
For Nine Months Ended September 30, 2021
Service charges on deposit accounts	$	0	$	2,522	$	2,522
Debit card and EFT fees		0		3,438		3,438
Trust fees		6,929		0		6,929
Insurance agency commissions		0		2,748		2,748
Retirement plan consulting fees		1,043		0		1,043
Investment commissions		0		1,665		1,665
Other (outside the scope of ASC 606)		0		10,361		10,361
Total noninterest income	$	7,972	$	20,734	$	28,706

(In Thousands of Dollars)	Trust Segment		Bank Segment		Totals
For Nine Months Ended September 30, 2020
Service charges on deposit accounts	$	0	$	2,752	$	2,752
Debit card and EFT fees		0		2,866		2,866
Trust fees		5,682		0		5,682
Insurance agency commissions		0		2,348		2,348
Retirement plan consulting fees		1,129		0		1,129
Investment commissions		0		1,080		1,080
Other (outside the scope of ASC 606)		0		9,805		9,805
Total noninterest income	$	6,811	$	18,851	$	25,662

A description of the Company’s revenue streams under ASC 606 follows:

Service charges on deposit accounts – The Company earns fees from its deposit customers for transaction-based, account maintenance, and overdraft services. Management reviewed the deposit account agreements, and determined that the agreements can be terminated at any time by either the Bank or the account holder.  Transaction fees, such as balance transfers, wires and overdraft charges are settled the day the performance obligation is satisfied.  The Bank’s monthly service charges and maintenance fees are for services provided to the customer on a monthly basis and are considered a series of services that have the same pattern of transfer each month.  The review of service charges assessed on deposit accounts included the amount of variable consideration that is a part of the monthly charges.  It was found that the waiver of service charges due to insufficient funds and dormant account fees is immaterial and would not require a change in the accounting treatment for these fees under the new revenue standards.

Debit Card Interchange Fees – Customers and the Bank have an account agreement and maintain deposit balances with the Bank.  Customers use a bank issued debit card to purchase goods and services, and the Bank earns interchange fees on those transactions, typically a percentage of the sale amount of the transaction.  The Bank records the amount due when it receives the settlement from the payment network.  Payments from the payment network are received and recorded into income on a daily basis.  There are no contingent debit card interchange fees recorded by the Company that could be subject to a clawback in future periods.

Trust fees – Services provided to Trust customers are a series of distinct services that have the same pattern of transfer each month.  Fees for trust accounts are billed and drafted from trust accounts monthly.  The Company records these fees on the income statement on a monthly basis.  Fees are assessed based on the total investable assets of the customer’s trust account.  A signed contract between the Company and the customer is maintained for all customer trust accounts with payment terms identified.  It is probable that the fees will be collectible as funds being managed are accessible by the asset manager.  Past history of trust fee income recorded by the Company indicates that it is highly unlikely that a significant reversal could occur.  There are no contingent incentive fees recorded by the Company that could be subject to a clawback in future periods.

Insurance Agency Commissions – Insurance agency commissions are received from insurance carriers for the agency’s share of commissions from customer premium payments.  These commissions are recorded into income when checks are received from the insurance carriers, and there is no contingent portion associated with these commission checks.  There may be a short time-lag in recording revenue when cash is received instead of recording the revenue when the policy is signed by the customer, but the time lag is insignificant and does not impact the revenue recognition process.

26

Insurance also receives incentive checks from the insurance carriers for achieving specified levels of production with particular carriers.  These amounts are recorded into income when a check is received, and there are no contingent amounts associated with these payments that may be clawed back by the carrier in the future.  Similar to the monthly commissions explained in the preceding paragraph, there may be a short time-lag in recording incentive revenue on a cash basis as opposed to estimating the amount of incentive revenue expected to be earned, this does not materially impact the recognition of Insurance revenue.  If there were any amounts that would need to be refunded for one specific Insurance customer, management believes the reversal would not be significant.

Other potential situations surrounding the recognition of Insurance revenue include the estimating potential refunds due to the likely cancellation of a percentage of customers cancelling their policies and recording revenue at the time of policy renewals.  Management concluded that since Insurance agency commissions represent only 2.4% of the Company’s total revenue, adjusting the current practice of recording insurance revenue for these situations would not have a material impact on the reporting of total revenue.  

Retirement Plan Consulting Fees – Revenue is recognized based on the level of work performed for the client.  Any payments that are received for work to be performed in the future are recorded in a deferred revenue account, and recorded into income when the fees are earned.  Retirement plan consulting fees represent only 0.9% of the Company’s total revenue, and therefore management has concluded that any adjustment of revenue for one particular customer for a refund or any other reason would be insignificant and would not materially impact the Company’s total revenue.  

Investment Commissions – Investment commissions are earned through the sales of non-deposit investment products to customers of the Company.  The sales are conducted through a third-party broker-dealer.  When the commissions are received and recorded into income on the Bank’s income statement, there is no contingent portion that may need to be refunded back to the third party broker dealer.  Investment commissions represent only 1.5% of the Company’s total revenue, and therefore management has concluded that any adjustment of revenue for a particular customer for a refund or any other reason would be insignificant and would not materially impact the Company’s total revenue.  

Other – Income items included in “Other” are Bank owned life insurance income, security gains, net gains on the sale of loans and other operating income.  Any amounts within the scope of ASC 606 are deemed immaterial.

Fair Value:

Fair value is the exchange price that would be received for an asset, or paid to transfer a liability (exit price), in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date.  There are three levels of inputs that may be used to measure fair values:

Level 1 – Quoted prices (unadjusted) for identical assets or liabilities in active markets that the entity has the ability to access as of the measurement date.

Level 2 – Significant other observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data.

Level 3 – Significant unobservable inputs that reflect a reporting entity’s own assumptions about the assumptions that market participants would use in pricing an asset or liability.

The Company used the following methods and significant assumptions to estimate the fair value of each type of financial instrument:

Investment Securities: The Company uses a third party service to estimate fair value on available for sale securities on a monthly basis.  The Company’s service provider is considered a leading evaluation pricing service for U.S. domestic fixed income securities and values securities using exit pricing requirements.  They subscribe to multiple third-party pricing vendors, and supplement that information with matrix pricing methods.  The fair values for investment securities, which consist of equity securities that are recorded at fair market value to comply with exit pricing, are determined by quoted market prices in active markets, if available (Level 1).  The equity securities change in fair market value is recorded in the income statements.  For securities where quoted prices are not available, fair values are calculated based on quoted prices for similar assets in active markets, quoted prices for similar assets in markets that are not active or inputs other than quoted prices, which provide a reasonable basis for fair value determination.  Such inputs may include interest rates and yield curves, volatilities, prepayment speeds, credit risks and default rates.  Inputs used are derived principally from observable market data (Level 2).  For securities where quoted prices or market prices of similar securities are not available, fair values are calculated using discounted cash flows or other market indicators (Level 3).  The fair values of Level 3 investment securities are determined by using unobservable inputs to measure fair value of assets for which there is little, if any market activity at the measurement date, using reasonable inputs and assumptions based on the best information at the time, to the

27

extent that inputs are available without undue cost and effort.  For the period ended September 30, 2021 and for the year ended December 31, 2020, the fair value of Level 3 investment securities was immaterial.

Derivative Instruments: The fair values of derivative instruments are based on valuation models using observable market data as of the measurement date (Level 2).

Collateral Dependent Loans: Fair value estimates of collateral dependent loans that are individually reviewed are based on the fair value of the collateral, less estimated costs to sell.  Non-collateral dependent loans are valued based on discounted cash flows.  Loans carried at fair value generally receive specific allocations of the allowance for credit losses in 2021 and allowance for loan losses in prior periods.  For collateral dependent loans, fair value is commonly based on recent real estate appraisals.  These appraisals may utilize a single valuation approach or a combination of approaches including comparable sales and the income approach.  Adjustments are routinely made in the appraisal process by the appraisers to adjust for differences between the comparable sales and income data available.  Such adjustments are usually significant and typically result in a Level 3 classification of the inputs for determining fair value.  Non-real estate collateral may be valued using an appraisal, net book value per the borrower’s financial statements, or aging reports, adjusted or discounted based on management’s historical knowledge, changes in market conditions from the time of the valuation, and management’s expertise and knowledge of the client and client’s business, resulting in a Level 3 fair value classification.  These loans are evaluated on a quarterly basis and adjusted accordingly.

Other Real Estate Owned: Assets acquired through or instead of loan foreclosure are initially recorded at fair value less costs to sell when acquired, establishing a new cost basis.  These assets are subsequently accounted for at lower of cost or fair value less estimated costs to sell. Fair values are commonly based on recent real estate appraisals.  These appraisals may use a single valuation approach or a combination of approaches including comparable sales and the income approach.  Adjustments are routinely made in the appraisal process by the independent appraisers to adjust for differences between the comparable sales and income data available.  Such adjustments are usually significant and typically result in a Level 3 classification of the inputs for determining fair value.

Appraisals for both collateral-dependent impaired loans and other real estate owned are performed by certified general appraisers (for commercial and commercial real estate properties) or certified residential appraisers (for residential properties) whose qualifications and licenses have been reviewed and verified by the Company.  Once received, a member of the Appraisal Department reviews the assumptions and approaches utilized in the appraisal as well as the overall resulting fair value in comparison with independent data sources such as recent market data or industry-wide statistics.  On an annual basis, the Company compares the actual selling price of collateral that has been sold to the most recent appraised value to determine what adjustments should be made to appraisals to arrive at fair value.

Assets measured at fair value on a recurring basis are summarized below:

	Fair Value Measurements at September 30, 2021 Using:
(In Thousands of Dollars)	Carrying Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Financial Assets
Investment securities available-for sale
U.S. Treasury and U.S. government sponsored entities	$	88,470	$	0	$	88,470	$	0
State and political subdivisions		507,283		0		507,283		0
Corporate bonds		3,667		0		3,667		0
Mortgage-backed securities-residential		566,104		0		566,101		3
Collateralized mortgage obligations		13,241		0		13,241		0
Small Business Administration		4,596		0		4,596		0
Equity securities
Equity securities at fair value		493		493		0		0
Other investments measured at net asset value		6,024	n/a		n/a		n/a
Total investment securities	$	1,189,878	$	493	$	1,183,358	$	3
Interest rate swaps	$	2,768	$	0	$	2,768	$	0
Financial Liabilities
Interest rate swaps	$	2,768	$	0	$	2,768	$	0

28

	Fair Value Measurements at December 31, 2020 Using:
(In Thousands of Dollars)	Carrying Value		Quoted Prices  in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Financial Assets
Investment securities available-for sale
U.S. Treasury and U.S. government sponsored entities	$	11,845	$	0	$	11,845	$	0
State and political subdivisions		366,306		0		366,306		0
Corporate bonds		3,712		0		3,712		0
Mortgage-backed securities-residential		161,782		0		161,778		4
Collateralized mortgage obligations		26,393		0		26,393		0
Small Business Administration		5,562		0		5,562		0
Equity securities
Equity securities at fair value		538		538		0		0
Other investments measured at net asset value		6,343	n/a		n/a		n/a
Total investment securities	$	582,481	$	538	$	575,596	$	4
Interest rate swaps	$	4,221	$	0	$	4,221	$	0
Financial Liabilities
Interest rate swaps	$	4,221	$	0	$	4,221	$	0

There were no significant transfers between Level 1 and Level 2 during the three and nine month periods ended September 30, 2021 and 2020.

The table below presents a reconciliation of all assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3):

	Investment Securities Available-for-sale (Level 3)
	Three Months ended September 30,				Nine Months ended September 30,
(In Thousands of Dollars)	2021		2020		2021			2020
Beginning Balance	$	3	$	4	$	4		$	5
Transfers from level 2		0		0		0			0
Repayments, calls and maturities		0		0		(1	)		(1	)
Ending Balance	$	3	$	4	$	3		$	4

Assets measured at fair value on a non-recurring basis are summarized below:

	Fair Value Measurements at September 30, 2021 Using:
(In Thousands of Dollars)	Carrying Value		Quoted Prices  in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Financial Assets
Commercial
Commercial and industrial	$	2,954	$	0	$	0	$	2,954
1–4 family residential		82		0		0		82

29

	Fair Value Measurements at December 31, 2020 Using:
(In Thousands of Dollars)	Carrying Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Financial Assets
Impaired loans
Commercial	$	1,770	$	0	$	0	$	1,770
1–4 family residential		82		0		0		82
Consumer		36		0		0		36

Collateral dependent loans were individually evaluated under ASC 326 for the period ended September 30, 2021, while impaired loans from the period ended December 31, 2020 were individually evaluated under ASC 310.  Collateral dependent loans had a principal balance of $3.5 million with a valuation allowance of $435 thousand at September 30, 2021.  Impaired loans that were measured for impairment using the fair value of the collateral had a principal balance of $2.3 million, with a valuation allowance of $368 thousand at December 31, 2020.  Excluded from the above tables at September 30, 2021 and December 31, 2020, are $724 thousand and $513 thousand of loans classified as troubled debt restructurings and measured using the present value of cash flows, which is not considered an exit price.

Collateral dependent commercial real estate loans, both owner-occupied and non-owner occupied are valued by independent external appraisals.  These external appraisals are prepared using the sales comparison approach and income approach valuation techniques.  Management makes subsequent unobservable adjustments to the collateral dependent loan appraisals.  Collateral dependent loans other than commercial real estate and other real estate owned are not considered material.

The following table presents quantitative information about Level 3 fair value measurements for financial instruments measured at fair value on a non-recurring basis at the periods ended September 30, 2021 and December 31, 2020:

September 30, 2021	Fair value		Valuation Technique(s)	Unobservable Input(s)	Range (Weighted Average)
Individually evaluated loans
Commercial	$	2,954	Sales Comparison	Adjustment for differences between comparable sales	(14.66%) - 8.99% (0%)
Residential		82	Sales comparison	Adjustment for differences between comparable sales	(3.84%) - 3.22% (0.12%)

December 31, 2020	Fair value		Valuation Technique(s)	Unobservable Input(s)	Range (Weighted Average)
Impaired loans
Commercial	$	1,770	Sales comparison	Adjustment for differences between comparable sales	(24.01%) - 17.93% (0.48%)
Residential		82	Sales comparison	Adjustment for differences between comparable sales	(40.00%) - 47.15% (17.77%)
Consumer		36	Sales comparison	Adjustment for differences between comparable sales	(23.60%) - 23.60% (0.00%)

30

The carrying amounts and estimated fair values of financial instruments not previously disclosed at September 30, 2021 and December 31, 2020 are as follows:

			Fair Value Measurements at September 30, 2021 Using:
(In Thousands of Dollars)	Carrying Amount		Level 1		Level 2		Level 3		Total
Financial assets
Cash and cash equivalents	$	79,808	$	26,933	$	52,875	$	0	$	79,808
Restricted stock		12,524	n/a		n/a		n/a		n/a
Loans held for sale		2,628		0		2,707		0		2,707
Loans, net		1,871,080		0		0		1,857,184		1,857,184
Accrued interest receivable		9,930		0		5,126		4,804		9,930
Financial liabilities
Deposits		2,866,413		2,514,758		350,919		0		2,865,677
Long-term borrowings		49,649		0		49,267		0		49,267
Accrued interest payable		389		26		363		0		389

			Fair Value Measurements at December 31, 2020 Using:
(In Thousands of Dollars)	Carrying Amount		Level 1		Level 2		Level 3		Total
Financial assets
Cash and cash equivalents	$	254,621	$	20,503	$	234,118	$	0	$	254,621
Restricted stock		14,647	n/a		n/a		n/a		n/a
Loans held for sale		4,766		0		4,909		0		4,909
Loans, net		2,055,900		0		0		2,036,872		2,036,872
Accrued interest receivable		9,880		0		3,297		6,583		9,880
Financial liabilities
Deposits		2,610,878		2,097,732		487,105		0		2,584,837
Short-term borrowings		2,521		0		2,521		0		2,521
Long-term borrowings		76,385		0		77,189		0		77,189
Accrued interest payable		690		36		654		0		690

The methods and assumptions used to estimate fair value, not previously described, are described as follows:

Cash and Cash Equivalents: The carrying amounts of cash and short-term instruments approximate fair values and are classified as Level 1.

Restricted Stock: It is not practical to determine the fair value of restricted stock due to restrictions placed on its transferability.

Loans: Fair values of loans, excluding loans held for sale, are estimated as follows: The Company uses a third party firm that uses cash flow analysis and current market interest rates along with adjustments for credit, liquidity and option risk to conform to the ASU 2016-01 exit price requirement.  Loans in the tables above consist of impaired credits held for investment.  Fair value for collateral dependent loans is based upon appraised values adjusted for trends observed in the market, less estimated cost to sell. The cash flow method is used for estimating fair value for noncollateral dependent loans. A valuation allowance was recorded for the excess of the loan’s recorded investment over the amounts determined by the collateral value method. This valuation is a component of the allowance for credit losses. The Company considers these fair values Level 3.

Loans held for sale: The fair value of loans held for sale is estimated based upon binding contracts and quotes from third party investors resulting in a Level 2 classification.

Deposits: The fair values disclosed for demand deposits – interest and non-interest checking, passbook savings, and money market accounts – are, by definition, equal to the amount payable on demand at the reporting date resulting in a Level 1 classification.  The carrying amounts of variable rate certificates of deposit approximate their fair values at the reporting date resulting in a Level 2 classification.  Fair value for fixed rate certificates of deposit are estimated using a discounted cash flows calculation that applies interest rates currently being offered on certificates to a schedule of aggregated expected monthly maturities on time deposits resulting in a Level 2 classification.

31

Short-term Borrowings: The carrying amounts of federal funds purchased, borrowings under repurchase agreements, and other short-term borrowings, generally maturing within ninety days, approximate their fair values resulting in a Level 2 classification.

Long-term Borrowings: The fair values of the Company’s long-term borrowings are estimated using discounted cash flow analyses based on the current borrowing rates for similar types of borrowing arrangements resulting in a Level 2 classification.

Off-balance Sheet Instruments: The fair value of commitments is not considered material.

Goodwill and Intangible Assets:

Goodwill associated with the Company’s purchase of Maple Leaf in January 2020 and other past acquisitions totaled $45.8 million at September 30, 2021 and December 31, 2020.  Impairment exists when a reporting unit’s carrying value of goodwill exceeds its fair value, which is determined through a two-step impairment test. Management performs goodwill impairment testing on an annual basis as of September 30.  The fair value of the reporting units is determined using a combination of a discounted cash flow method and a guideline public company method.  

Acquired Intangible Assets

Acquired intangible assets were as follows:

	September 30, 2021					December 31, 2020
(In Thousands of Dollars)	Gross Carrying Amount		Accumulated Amortization			Gross Carrying Amount		Accumulated Amortization
Amortized intangible assets:
Customer relationship intangibles	$	7,210	$	(6,557	)	$	7,210	$	(6,318	)
Non-compete contracts		430		(391	)		430		(388	)
Trade name		520		(350	)		520		(320	)
Core deposit intangible		6,979		(4,946	)		6,979		(4,271	)
Total	$	15,139	$	(12,244	)	$	15,139	$	(11,297	)

Aggregate amortization expense was $316 thousand and $948 thousand for the three and nine month periods ended September 30, 2021.  Amortization expense was $332 thousand and $995 thousand for the three and nine months ended September 30, 2020.

Estimated amortization expense for each of the next five periods and thereafter:

2021 (3 months)	$	318
2022		1,090
2023		617
2024		314
2025		253
Thereafter		303
Total	$	2,895

Leases:

The Company has operating leases for branch office locations, vehicles and certain office equipment such as printers, copiers and faxes. The leases have remaining lease terms of 7 months to 8.3 years, some of which include options to extend the lease for up to 10 years and some of which include options to terminate the leases within 2 months.

The right of use asset and lease liability were $4.5 million and $4.7 million as of September 30, 2021 and $4.8 million and $5.0 million at December 31, 2020.

Lease payments made for the three and nine month period ended September 30, 2021, were $206 thousand and $610 thousand, while lease payments made for the three and nine month period ended September 30, 2020, were $191 thousand and $581 thousand, respectively. Interest expense and amortization expense on finance leases for the three month period ended September 30, 2021, was $44 thousand and $124 thousand, and $116 thousand and $366 thousand for the nine month period ended September 30, 2021.  Interest expense and amortization expense on finance leases for the three month period ended September 30, 2020, was $38 thousand

32

and $121 thousand, and $95 thousand and $334 thousand for the nine month period ended September 30, 2020.  The weighted-average remaining lease term for all leases was 4.2 years as of September 30, 2021 and the weighted-average discount rate was 2.4%.

Maturities of lease liabilities are as follows as of September 30, 2021:

2021 (3 months)	$	201
2022		647
2023		592
2024		417
2025		424
Thereafter		3,240
Total Payments		5,521
Less: Imputed Interest		(834	)
Total	$	4,687

Interest-Rate Swaps:

The Company uses a program that utilizes interest-rate swaps as part of its asset/liability management strategy.  The interest-rate swaps are used to help manage the Company’s interest rate risk position and not as derivatives for trading purposes.  The notional amount of the interest-rate swaps does not represent amounts exchanged by the parties.  The amount exchanged is determined by reference to the notional amount and the other terms of the individual interest-rate swap agreements.

The objective of the interest-rate swaps is to protect the related fixed rate commercial real estate loans from changes in fair value due to changes in interest rates.  The Company has a program whereby it lends to its borrowers at a fixed rate with the loan agreement containing a two-way yield maintenance provision, which will be invoked in the event of prepayment of the loan, and is expected to exactly offset the fair value of unwinding the swap.  The yield maintenance provision represents an embedded derivative which is bifurcated from the host loan contract and, as such, the swaps and embedded derivatives are not designated as hedges.  Accordingly, both instruments are carried at fair value and changes in fair value are reported in current period earnings.

Summary information about these interest-rate swaps at periods ended September 30, 2021 and December 31, 2020 is as follows:

	September 30, 2021			December 31, 2020
Notional amounts (In thousands)	$	48,985		$	41,315
Weighted average pay rate on interest-rate swaps		4.63	%		4.63	%
Weighted average receive rate on interest-rate swaps		2.27	%		2.36	%
Weighted average maturity (years)		3.9			4.3
Fair value of interest-rate swaps (In thousands)	$	(2,768	)	$	(4,221	)
Fair value of loan yield maintenance provisions (In thousands)	$	2,768		$	4,221

The fair value of the yield maintenance provisions and interest-rate swaps is recorded in other assets and other liabilities, respectively, in the consolidated balance sheets.  Changes in the fair value of the yield maintenance provisions and interest-rate swaps are reported in earnings, as other noninterest income in the consolidated statements of income.  For the three month and nine month periods ended September 30, 2021 and 2020 there were no net gains or losses recognized in earnings.

33

Earnings Per Share:

The computation of basic and diluted earnings per share is shown in the following table:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2021		2020		2021		2020
Basic EPS
Net income (In thousands)	$	16,011	$	10,869	$	46,142	$	30,519
Weighted average shares outstanding		28,246,206		28,182,744		28,235,732		28,293,445
Basic earnings per share	$	0.57	$	0.39	$	1.63	$	1.08
Diluted EPS
Net income (In thousands)	$	16,011	$	10,869	$	46,142	$	30,519
Weighted average shares outstanding for basic earnings per share		28,246,206		28,182,744		28,235,732		28,293,445
Dilutive effect of restricted stock awards		114,355		107,778		102,813		127,779
Weighted average shares for diluted earnings per share		28,360,561		28,290,522		28,338,545		28,421,224
Diluted earnings per share	$	0.56	$	0.38	$	1.63	$	1.07

There were 17,495 and 94,247 restricted stock awards that were considered anti-dilutive for the three and nine month periods ended September 30, 2021, respectively.  There were no restricted stock awards that were considered anti-dilutive for the three and nine month periods ended September 30, 2020.

Stock Based Compensation:

During 2017, the Company, with the approval of shareholders, created the 2017 Equity Incentive Plan (the “2017 Plan”).  The 2017 Plan permits the award of up to 800 thousand shares to the Company’s directors and employees to attract and retain exceptional personnel, motivate performance and most importantly to help align the interests of the Company’s executives with those of the Company’s shareholders.  There were 38,061 service time based share awards and 58,245 performance based share awards granted under the 2017 Plan during the nine month period ended September 30, 2021, as shown in the table below.  The actual number of performance based shares issued will depend on the relative performance of the Company’s average return on equity compared to a group of peer companies over a three year vesting period, ending December 31, 2023.  As of September 30, 2021, 300,009 shares are still available to be awarded from the 2017 Plan.    

The restricted stock awards were granted with a fair value price equal to the market price of the Company’s common stock at the date of the grant.  Expense recognized was $278 thousand and $865 thousand for the three and nine month periods ended September 30, 2021, respectively.  During the prior periods, the expense recognized was $364 thousand and $1.1 million for the three and nine month periods ended September 30, 2020, respectively.  As of September 30, 2021, there was $1.7 million of total unrecognized compensation expense related to the nonvested shares granted under the Plans.  The remaining cost is expected to be recognized over 2.6 years.  

The following is the activity under the Plans during the nine month period ended September 30, 2021.

	Nine Months Ended September 30, 2021
	Maximum Awarded Service Units			Weighted Average Grant Date Fair Value		Maximum Awarded Performance Units			Weighted Average Grant Date Fair Value
Beginning balance - non-vested shares		67,765		$	14.32		153,070		$	14.46
Granted		38,061			15.45		58,245			14.21
Vested		(26,621	)		14.41		(52,327	)		14.34
Forfeited		(4,758	)		14.15		0			0
Ending balance - non-vested shares		74,447		$	14.94		158,988		$	14.40

The 78,948 shares that vested during the nine month period ended September 30, 2021 had a weighted average fair value of $14.36 per share.

34

Other Comprehensive Income (Loss):

The following table represents the details of other comprehensive income for the three and nine month periods ended September 30, 2021 and 2020.

	Three Months Ended September 30, 2021
(In Thousands of Dollars)	Pre-tax			Tax			After-Tax
Unrealized holding gains (loss) on available-for-sale securities during the period	$	(2,754	)	$	578		$	(2,176	)
Reclassification adjustment for (gains) included in net income (1)		(464	)		96			(368	)
Net other comprehensive income	$	(3,218	)	$	674		$	(2,544	)
	Three Months Ended September 30, 2020
(In Thousands of Dollars)	Pre-tax			Tax			After-Tax
Unrealized holding gains on available-for-sale securities during the period	$	700		$	(147	)	$	553
Reclassification adjustment for (gains) included in net income (1)		(48	)		9			(39	)
Net other comprehensive income	$	652		$	(138	)	$	514
	Nine Months Ended September 30, 2021
(In Thousands of Dollars)	Pre-tax			Tax			After-Tax
Unrealized holding gains (loss) on available-for-sale securities during the period	$	(8,990	)	$	1,888		$	(7,102	)
Reclassification adjustment for (gains) included in net income (1)		(848	)		178			(670	)
Net other comprehensive income	$	(9,838	)	$	2,066		$	(7,772	)
	Nine Months Ended September 30, 2020
(In Thousands of Dollars)	Pre-tax			Tax			After-Tax
Unrealized holding gains on available-for-sale securities during the period	$	13,894		$	(2,918	)	$	10,976
Reclassification adjustment for (gains) losses included in net income (1)		(318	)		66			(252	)
Net other comprehensive income	$	13,576		$	(2,852	)	$	10,724

(1) Pre-tax reclassification adjustments relating to available-for-sale securities are reported in security gains and the tax impact is included in income tax expense on the consolidated statements of income.

Regulatory Capital Matters:

Banks and bank holding companies are subject to various regulatory capital requirements administered by the federal banking agencies.  Capital adequacy guidelines and, additionally for banks, prompt corrective action regulations, involve quantitative measures of assets, liabilities, and certain off-balance sheet items calculated under regulatory accounting practices.  Capital amounts and classifications are also subject to qualitative judgments by regulators.  Failure to meet capital requirements can initiate regulatory action by regulators that, if undertaken, could have a direct material effect on the financial statements.  Management believes that as of September 30, 2021, the Company and the Bank meet all capital adequacy requirements to which they are subject.

The FDIC and other federal banking regulators revised the risk-based capital requirements applicable to financial holding companies and insured depository institutions, including the Company and the Bank, to make them consistent with agreements that were reached by the Basel Committee on Banking Supervision (“Basel III”).

The common equity tier 1 capital, tier 1 capital and total capital ratios are calculated by dividing the respective capital amounts by risk-weighted assets.  The leverage ratio is calculated by dividing tier 1 capital by adjusted average total assets.

Basel III limits capital distributions and certain discretionary bonus payments if the banking organization does not hold a “capital conservation buffer” consisting of 2.5% of common equity tier 1 capital, tier 1 capital and total capital to risk-weighted assets in addition to the amount necessary to meet minimum risk-based capital requirements.  Excluding the additional buffer, Basel III requires the Company and the Bank to maintain (i) a minimum ratio of common equity tier 1 capital to risk-weighted assets of at least 4.5%, (ii) a minimum ratio of tier 1 capital to risk-weighted assets of at least 6.0%, (iii) a minimum ratio of total capital to risk-weighted assets of at least 8.0% and (iv) a minimum leverage ratio of at least 4.0%.

35

Prompt corrective action regulations provide five classifications: well capitalized, adequately capitalized, undercapitalized, significantly undercapitalized, and critically undercapitalized, although these terms are not used to represent overall financial condition.  If only adequately capitalized, regulatory approval is required to accept brokered deposits.  If undercapitalized, capital distributions are limited, as is asset growth and expansion, and capital restoration plans are required.  At September 30, 2021 and December 31, 2020, the most recent regulatory notifications categorized the Bank as well capitalized under the regulatory framework for prompt corrective action.  There are no conditions or events since that notification that management believes have changed the institution’s category.

Actual and required capital amounts and ratios, which do not include the capital conservation buffer, are presented below at September 30, 2021 and December 31, 2020:

	Actual					Requirement For Capital Adequacy Purposes:					To be Well Capitalized Under Prompt Corrective Action Provisions:
	Amount		Ratio			Amount		Ratio			Amount		Ratio
September 30, 2021
Common equity tier 1 capital ratio
Consolidated	$	315,850		14.55	%	$	97,715		4.5	%	N/A		N/A
Bank		265,224		12.23	%		97,606		4.5	%		140,986		6.5	%
Total risk based capital ratio
Consolidated		351,987		16.21	%		173,715		8.0	%	N/A		N/A
Bank		288,360		13.29	%		173,521		8.0	%		216,901		10.0	%
Tier 1 risk based capital ratio
Consolidated		328,850		15.14	%		130,286		6.0	%	N/A		N/A
Bank		265,224		12.23	%		130,141		6.0	%		173,521		8.0	%
Tier 1 leverage ratio
Consolidated		328,850		10.17	%		129,307		4.0	%	N/A		N/A
Bank		265,224		8.25	%		128,647		4.0	%		160,809		5.0	%
December 31, 2020
Common equity tier 1 capital ratio
Consolidated	$	279,864		13.22	%	$	95,211		4.5	%	N/A		N/A
Bank		268,041		12.71	%		94,903		4.5	%	$	137,083		6.5	%
Total risk based capital ratio
Consolidated		311,413		14.72	%		169,264		8.0	%	N/A		N/A
Bank		290,185		13.76	%		168,717		8.0	%		210,897		10.0	%
Tier 1 risk based capital ratio
Consolidated		289,269		13.67	%		126,948		6.0	%	N/A		N/A
Bank		268,041		12.71	%		126,538		6.0	%		168,717		8.0	%
Tier 1 leverage ratio
Consolidated		289,269		9.77	%		118,464		4.0	%	N/A		N/A
Bank		268,041		9.10	%		117,877		4.0	%		147,346		5.0	%

Segment Information:

The reportable segments are determined by the products and services offered, primarily distinguished between banking and trust.  The trust and retirement consulting segments were combined in 2019.   These segments are also distinguished by the level of information provided to the chief operating decision makers in the Company, who use such information to review performance of various components of the business, which are then aggregated.  Loans, investments, and deposits provide the revenues in the banking operation.  All operations are domestic.  Significant segment totals are reconciled to the financial statements as follows:

(In Thousands of Dollars)	Trust Segment		Bank Segment		Eliminations and Others			Consolidated Totals
September 30, 2021
Goodwill and other intangibles	$	5,872	$	46,356	$	(3,558	)	$	48,670
Total assets	$	14,732	$	3,298,987	$	3,328		$	3,317,047

36

(In Thousands of Dollars)	Trust Segment		Bank Segment		Eliminations and Others			Consolidated Totals
December 31, 2020
Goodwill and other intangibles	$	6,046	$	47,129	$	(3,558	)	$	49,617
Total assets	$	15,147	$	3,055,628	$	373		$	3,071,148

(In Thousands of Dollars)	Trust Segment		Bank Segment			Eliminations and Others			Consolidated Totals
For Three Months Ended September 30, 2021
Net interest income	$	31	$	26,798		$	(295	)	$	26,534
Provision for credit losses and unfunded loans		0		(948	)		0			(948	)
Service fees, security gains and other noninterest income		2,707		6,385			(77	)		9,015
Noninterest expense		1,726		14,586			(12	)		16,300
Amortization and depreciation expense		67		653			108			828
Income before taxes		945		18,892			(468	)		19,369
Income taxes		198		3,310			(150	)		3,358
Net income	$	747	$	15,582		$	(318	)	$	16,011

(In Thousands of Dollars)	Trust Segment		Bank Segment			Eliminations and Others			Consolidated Totals
For Nine Months Ended September 30, 2021
Net interest income	$	94	$	78,597		$	(400	)	$	78,291
Provision for credit losses and unfunded loans		0		(473	)		0			(473	)
Service fees, security gains and other noninterest income		8,108		20,726			(128	)		28,706
Noninterest expense		4,818		44,727			(409	)		49,136
Amortization and depreciation expense		194		1,992			244			2,430
Income before taxes		3,190		53,077			(363	)		55,904
Income taxes		669		9,379			(286	)		9,762
Net income	$	2,521	$	43,698		$	(77	)	$	46,142

(In Thousands of Dollars)	Trust Segment		Bank Segment		Eliminations and Others			Consolidated Totals
For Three Months Ended September 30, 2020
Net interest income	$	31	$	24,197	$	(63	)	$	24,165
Provision for credit losses and unfunded loans		0		2,600		0			2,600
Service fees, security gains and other noninterest income		2,357		6,924		(64	)		9,217
Noninterest expense		1,507		15,112		63			16,682
Amortization and depreciation expense		88		632		68			788
Income before taxes		793		12,777		(258	)		13,312
Income taxes		166		2,397		(120	)		2,443
Net income	$	627	$	10,380	$	(138	)	$	10,869

(In Thousands of Dollars)	Trust Segment		Bank Segment		Eliminations and Others			Consolidated Totals
For Nine Months Ended September 30, 2020
Net interest income	$	95	$	70,540	$	(247	)	$	70,388
Provision for credit losses and unfunded loans		0		6,100		0			6,100
Service fees, security gains and other noninterest income		6,922		19,086		(346	)		25,662
Noninterest expense		4,549		45,886		634			51,069
Amortization and depreciation expense		228		1,905		184			2,317
Income before taxes		2,240		35,735		(1,411	)		36,564
Income taxes		470		6,051		(476	)		6,045
Net income	$	1,770	$	29,684	$	(935	)	$	30,519

37

The Bank segment includes Farmers National Insurance and Farmers of Canfield Investment Co.

Short-term borrowings:

 The Company had  no securities sold under repurchase agreements at September 30, 2021 and $2.2 million in securities sold under repurchase agreements at December 31, 2020.  In addition, the Company had a $350,000 balance on a line of credit with one lending institution at December 31, 2020.  There was no balance on this line at September 30, 2021.  

Securities sold under repurchase agreements are secured by the Bank’s holdings of debt securities issued by U.S. Government sponsored entities and agencies.  These pledged securities which are 105% of the repurchase agreement balances, had a carrying amount of $2.3 million at December 31, 2020.

Long-term borrowings:

There were $40.0 million in long-term Federal Home Loan Bank Advances at September 30, 2021 with a weighted average interest rate of 1.79%.  Long-term Federal Home Loan Bank Advances were $67.0 million at December 31, 2020 and had a weighted average interest rate of 1.39%.  In addition, the Company had two Trust Preferred Debentures with an outstanding balance of $9.6 million at September 30, 2021 and $9.4 million at December 31, 2020.  Both of these debentures mature in calendar year 2036.  The debentures have a weighted average interest rate of 1.89% and 1.99% at September 30, 2021 and December 31, 2020, respectively.

Long-term and short-term FHLB advances are secured by a blanket pledge of residential mortgage, commercial real estate, and multi-family loans.  Based on this collateral, the Bank is eligible to borrow an additional $579.9 million at September 30, 2021.  The advance is subject to a prepayment penalty if paid prior to its maturity date.

38

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Cautionary Note Regarding Forward Looking Statements

This Quarterly Report on Form 10-Q contains “forward-looking statements” within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements are not statements of historical fact, but rather statements based on the Company’s current expectations, beliefs and assumptions regarding the future of Farmers’ business, future plans and strategies, projections, anticipated events and trends, its intended results and future performance, the economy and other future conditions. Forward-looking statements are preceded by terms such as “will,” “would,” “should,” “could,” “may,” “expect,” “estimate,” “believe,” “anticipate,” “intend,” “plan” “project,” or variations of these words, or similar expressions. Forward-looking statements are not a guarantee of future performance and actual future results could differ materially from those contained in forward-looking information. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control.  Numerous uncertainties, risks, and changes could cause or contribute to Farmers’ actual results, performance, and achievements to be materially different from those expressed or implied by the forward-looking statements.  

Factors that could cause or contribute to such differences include, without limitation, risks and uncertainties detailed from time to time in the Company’s filings with the Securities and Exchange Commission (the “Commission”), including without limitation, the risk factors disclosed in Item 1A, “Risk Factors,” in the Company’s 2020 Form 10-K, as updated in Item 1A, “Risk Factors,” in this Quarterly Report on Form 10-Q.  

Many of these factors are beyond the Company’s ability to control or predict, and readers are cautioned not to put undue reliance on those forward-looking statements.  The following, which is not intended to be an all-encompassing list, summarizes several factors that could cause the Company’s actual results to differ materially from those anticipated or expected in any forward-looking statement:

• general economic conditions in markets where the Company conducts business, which could materially impact credit quality trends;

• effects of the COVID-19 pandemic on the local, national, and international economy, our organization and employees, and our customers and suppliers and their business operations, financial condition, and including our customers’ ability to repay loans;

• disruptions in the mortgage and lending markets and significant or unexpected fluctuations in interest rates related to COVID-19 and governmental responses, including financial stimulus packages;

• general business conditions in the banking industry;

• the regulatory environment;

• general fluctuations in interest rates;

• demand for loans in the market areas where the Company conducts business;

• rapidly changing technology and evolving banking industry standards;

• competitive factors, including increased competition with regional and national financial institutions;

• and new service and product offerings by competitors and price pressures;

• the regulatory landscape, capital markets, and the response to and management of the COVID-19 pandemic, including the provision of additional economic stimulus from the federal government.

Other factors not currently anticipated may also materially and adversely affect the Company’s results of operations, cash flows and financial position.  There can be no assurance that future results will meet expectations.  While the Company believes that the forward-looking statements in the presentation are reasonable, you should not place undue reliance on any forward-looking statement. In addition, these statements speak only as of the date made.  The Company does not undertake, and expressly disclaims, any obligation to update or alter any statements whether as a result of new information, future events or otherwise, expect as may be required by applicable law.

Overview

The Company’s results of operations for the quarter ended September 30, 2021 are discussed below.  However, the Company’s past results of operations may not reflect its future operating trends.  In March 2020, the COVID-19 pandemic began to affect the U.S. economy and has created additional uncertainty for the Company’s business.  Regulatory actions in response to the COVID-19 pandemic have varied across jurisdictions and have included some limited closures of nonessential businesses, affecting customers of the Company.  The duration, extent and the effect of the government’s response to the economy is unknown.

39

The Company’s net income for the three months ended September 30, 2021, was $16.0 million, or $0.56 per diluted share, which compares to $10.9 million, or $0.38 per diluted share, for the three months ended September 30, 2020.  The results for the quarter were positively impacted by a negative provision for credit losses totaling $948 thousand pre-tax which was primarily due to a release of reserves for credit losses.  Net income excluding acquisition costs (non-GAAP) for the quarter ended September 30, 2021, was $16.5 million or $0.58 per share, compared to $10.9 million or $0.39 per share for the same quarter in 2020.  Annualized return on average assets and annualized return on average equity were 1.92% and 16.93%, respectively, for the three month period ended September 30, 2021, compared to 1.46% and 12.87% for the same three month period in 2020.  Farmers’ annualized return on average tangible equity (non-GAAP) was 19.63% for the quarter ended September 30, 2021 compared to 15.30% for the same quarter in 2020.

Net income for the nine months ended September 30, 2021 was $46.1 million, or $1.63 per diluted share, compared to $30.5 million, or $1.07 per diluted share, for the same nine month period in 2020.  Net income excluding acquisition costs (non-GAAP) for the nine months ended September 30, 2021 was $46.6 million, or $1.65 per share, compared to $31.7 million, or $1.11 per share for the same period in 2020.  Annualized return on average assets and return on average equity were 1.90% and 17.05%, respectively, for the nine month period ending September 30, 2021, compared to 1.45% and 12.84% for the same period in 2020.  

On November 1, 2021, the Company completed the Merger with Cortland.  The transaction will increase Farmers’ market share in Trumbull, Mahoning and Cuyahoga Counties and will enable Farmers to continue building local scale throughout Northeast Ohio.  As of September 30, 2021, Cortland had total assets of $799.2 million, which included gross loans of $500.0 million, deposits of $693.0 million and equity of $83.0 million. See “Business Combinations” in the Notes to Unaudited Consolidated Financial Statements above for additional information regarding the Merger. 

Total loans were $1.89 billion at September 30, 2021 compared to $2.08 billion at December 31, 2020, representing an annualized growth rate of (9.13%).  The decrease in loans has occurred primarily in the PPP category, with $53.6 million, net of deferred fees, in outstanding balances at September 30, 2021 compared to $128.1 million at December 31, 2020 representing a decrease of $74.5 million, or 58.2%.  Average loans now comprise 61.4% of the Bank's third quarter average earning assets at September 30, 2021, compared to 77.2% for the same period in 2020.

Non-performing assets to total assets remain at a low level, currently at 0.44%.  Early stage delinquencies, which are loans 30 - 89 days delinquent, also continue to remain at low levels, at $6.9 million, or 0.37% of total loans, at September 30, 2021.  Net charge-offs for the current quarter were $286 thousand, compared to $219 thousand in the same quarter in 2020 and net charge-offs as a percentage of average net loans outstanding is only 0.06% for the quarter ended September 30, 2021, compared to 0.04% in the same quarter in 2020.  Loan modifications due to COVID-19 could negatively impact these ratios in future periods.

Due to a decline in loan balances, a decrease in a specific reserve on one loan, and a continued decline in historical loss ratios, the Company recorded a negative provision for credit losses of $948,000 for the quarter ended September 30, 2021, compared to the $2.6 million of loan loss provision recorded in the third quarter of 2020.  As an overall percentage of loans, the allowance for credit losses increased to 1.22% for the current quarter compared to 0.90% for the quarter ended September 30, 2020.  Excluding the PPP loans, this allowance for credit losses to gross loans ratio increased to 1.26% (non-GAAP) as of September 30, 2021, and the ratio of the allowance for credit losses to gross loans, excluding PPP loans and acquired loans is 1.42% (non-GAAP).  

The net interest margin for the three months ended September 30, 2021, was 3.47%, an 8 basis point decrease from the quarter ended September 30, 2020.  In comparing the third quarter of 2021 to the same period in 2020, asset yields decreased 35 basis points, while the cost of interest-bearing liabilities decreased 36 basis points.  Most of the decrease in the asset yields was the result of lower rates earned on taxable and tax-exempt securities.

The net interest margin for the nine months ended September 30, 2021, was 3.50%, a 14 basis point decrease from the nine month period ended September 30, 2020.  Asset yields decreased 57 basis points, while the cost of interest-bearing liabilities decreased 51 basis points.  The reasons for the decreases are similar to those for the third quarter discussed above.

Noninterest income was down slightly to $9.0 million for the quarter ended September 30, 2021, compared to $9.2 million in the same quarter in 2020.  Net gains on the sale of loans was down $1.7 million, or 53.0%, for the third quarter of 2021 compared to the third quarter of 2020 due to lower origination volumes.  This decline was offset by an increase in trust fees of $362 thousand, or 18.4%, investment commissions of $285 thousand, or 80.7%, security gains of $389 thousand, or 555.7% and bank owned life insurance income of $144 thousand, or 73.5%.    For the nine month period, noninterest income increased 11.9% to $28.7 million compared to $25.7 million for the same period of 2020.  The reasons for the increases are similar to those for the third quarter discussed above.

The Company has remained committed to managing its level of noninterest expenses.  Total noninterest expenses for the third quarter of 2021 decreased 2.0% to $17.1 million compared to $17.5 million in the same quarter in 2020. Excluding merger related costs and a $326 thousand prepayment penalty for the payoff of a $25 million FHLB advance, noninterest expense has declined $1.1 million from the third quarter of 2020 to the third quarter of 2021.  The $342 thousand decline in noninterest expense from the third quarter of 2020

40

to the third quarter of 2021 was primarily due to a $923 thousand, or 9.0% decline in salaries and employee benefits, offset by an increase of $180 thousand, or 10.5%, in occupancy and equipment, $256 thousand, or 34.0%, in professional fees and $414 thousand, or 713.8%, in merger related expenses.  The drop in salary and employee benefits was due to lower health insurance costs compared to the same quarter in 2020 along with lower incentive compensation expense and a greater amount of contra salary expense fromFAS91 deferrals.  For the nine month period ended September 30, 2021, noninterest expenses decreased 3.4% to $51.6 million compared to $53.4 million for the same period in 2020.  The reasons for the decreases are similar to those for the third quarter discussed above except for merger related expenses, which decreased $837 thousand, or 58.7%, for the nine month period ended September 30, 2021.

The efficiency ratio for the quarter ended September 30, 2021 improved to 46.0% compared to 50.4% for the same quarter in 2020.  The increases in several categories of noninterest income and net interest income, accompanied with lower noninterest expenses were the main drivers of the improvement.  

The Company’s return on average tangible equity (non-GAAP) was 19.63% and 19.67% for the three and nine month periods ended September 30, 2021 compared to 15.30% and 15.14% for the same periods in 2020.

Return on average tangible equity is a non-GAAP financial measure and should be considered in addition to, not a substitute for, or superior to, financial measures determined in accordance with U.S. GAAP.  With respect to the calculation of the tangible equity for the three and nine month periods ended September 30, 2021 and 2020, reconciliations are displayed in the tables below.

Results of Operations The following is a comparison of selected financial ratios and other results at or for the three and nine month periods ended September 30, 2021 and 2020:

	At or for the Three Months Ended September 30,						At or for the Nine Months Ended September 30,
(In Thousands, except Per Share Data)	2021			2020			2021			2020
Total assets	$	3,317,047		$	2,989,179		$	3,317,047		$	2,989,179
Net income	$	16,011		$	10,869		$	46,142		$	30,519
Diluted earnings per share	$	0.56		$	0.38		$	1.63		$	1.07
Return on average assets (annualized)		1.92	%		1.46	%		1.90	%		1.45	%
Return on average equity (annualized)		16.93	%		12.87	%		17.05	%		12.84	%
Efficiency ratio (tax equivalent basis) (1)		46.04	%		50.37	%		46.49	%		53.48	%
Equity to asset ratio		11.38	%		11.37	%		11.38	%		11.37	%
Tangible common equity ratio (2)		10.06	%		9.82	%		10.06	%		9.82	%
Dividends to net income		19.41	%		28.53	%		20.20	%		30.49	%
Net loans to assets		56.41	%		71.18	%		56.41	%		71.18	%
Loans to deposits		66.08	%		84.59	%		66.08	%		84.59	%

(1) The ratio is calculated by dividing noninterest expenses by the sum of net interest income and noninterest income.  The Company strives for a lower efficiency ratio.  This efficiency ratio measure is not required by any regulatory agency but provides meaningful information to management and investors since a lower ratio indicates the Company is using their assets more effectively to generate profits.  

(2) The tangible common equity ratio is calculated by dividing total common stockholders’ equity by total assets, after reducing both amounts by intangible assets.  The tangible common equity ratio is not required by U.S. GAAP or by applicable bank regulatory requirements, but is a metric used by management to evaluate the adequacy of the Company’s capital levels.  Since there is no authoritative requirement to calculate the tangible common equity ratio, the Company’s tangible common equity ratio is not necessarily comparable to similar capital measures disclosed or used by other companies in the financial services industry.  Tangible common equity and tangible assets are non - U.S. GAAP financial measures and should be considered in addition to, not as a substitute for or superior to, financial measures determined in accordance with U.S. GAAP.  With respect to the calculation of the actual unaudited tangible common equity ratio as of September 30, 2021 and 2020, reconciliations of tangible common equity (non-GAAP) to U.S. GAAP total common stockholders’ equity and tangible assets (non-GAAP) to U.S. GAAP total assets are set forth below:

41

Reconciliation of Common Stockholders' Equity to Tangible Common Equity

	At or for the Three Months Ended		At or for the Three Months Ended		At or for the Three Months Ended
(In Thousands of Dollars)	September 30, 2021		December 31, 2020		September 30, 2020
Stockholders' equity	$	377,524	$	350,097	$	339,968
Less goodwill and other intangibles		48,670		49,617		51,608
Tangible common equity		328,854		300,480		288,360
Average stockholders' equity		375,208		344,949		335,982
Less average goodwill and other intangibles		48,879		51,476		51,754
Average tangible common equity	$	326,329	$	293,473	$	284,228

Reconciliation of Total Assets to Tangible Assets

	At or for the Three Months Ended		At or for the Three Months Ended		At or for the Three Months Ended
(In Thousands of Dollars)	September 30, 2021		December 31, 2020		September 30, 2020
Total assets	$	3,317,047	$	3,071,148	$	2,989,179
Less goodwill and other intangibles		48,670		49,617		51,608
Tangible assets	$	3,268,377	$	3,021,531	$	2,937,571
Average assets		3,304,708		3,033,005		2,957,702
Less average goodwill and other intangibles		48,879		51,476		51,754
Average tangible assets	$	3,255,829	$	2,981,529	$	2,905,948

Reconciliation of Net Income, Excluding Acquisition Costs

	At or for the Three Months Ended		At or for the Three Months Ended		At or for the Three Months Ended
(In Thousands of Dollars)	September 30, 2021		December 31, 2020		September 30, 2020
Net Income	$	16,011	$	11,357	$	10,869
Acquisition related costs - tax equated		468		1,431		50
Net Income - adjusted	$	16,479	$	12,788	$	10,919
Diluted EPS excluding acquisition costs	$	0.58	$	0.45	$	0.39

Reconciliation of Allowance for Credit Losses to Gross Loans, Excluding PPP Loans and Acquired Loans

	At or for the Three Months Ended			At or for the Three Months Ended			At or for the Three Months Ended
(In Thousands of Dollars)	September 30, 2021			December 31, 2020			September 30, 2020
Gross Loans	$	1,894,216		$	2,078,044		$	2,147,158
PPP Loans		53,580			125,396			194,490
Loans less PPP		1,840,636			1,952,648			1,952,668
Allowance for Credit Losses to Gross Loans Excluding PPP (a)		1.26	%		1.13	%		0.99	%
Acquired Loans		211,954			272,150			294,712
Loans less PPP and Acquired	$	1,628,682		$	1,680,498		$	1,657,956
Allowance for Credit Losses to Gross Loans Excluding PPP and Acquired (a)		1.42	%		1.32	%		1.17	%

42

(a) CECL method used for the September 30, 2021 quarter.  Prior periods shown in the table used the incurred loss methodology.

Net Interest Income. The following schedule details the various components of net interest income for the periods indicated.  All asset yields are calculated on a tax-equivalent basis where applicable.  Security yields are based on amortized cost.

43

Average Balance Sheets and Related Yields and Rates

(Dollar Amounts in Thousands)

	Three Months Ended								Three Months Ended
	September 30, 2021								September 30, 2020
	AVERAGE								AVERAGE
	BALANCE			INTEREST		RATE (1)			BALANCE			INTEREST		RATE (1)
EARNING ASSETS
Loans (3) (4)	$	1,917,443		$	22,665		4.69	%	$	2,142,624		$	24,331		4.52	%
Taxable securities (2)		727,271			3,222		1.76			197,311			1,263		2.55
Tax-exempt securities (2) (4)		360,371			3,065		3.37			254,533			2,459		3.84
Other investments		19,380			113		2.31			22,999			138		2.39
Federal funds sold and other		95,871			32		0.13			159,151			52		0.13
TOTAL EARNING ASSETS		3,120,336			29,097		3.70			2,776,618			28,243		4.05
NONEARNING ASSETS
Cash and due from banks		23,134								28,774
Premises and equipment		24,890								25,806
Allowance for loan losses		(24,758	)							(17,691	)
Unrealized gains (losses) on securities		25,851								27,766
Other assets		135,255								116,429
TOTAL ASSETS	$	3,304,708							$	2,957,702
INTEREST-BEARING LIABILITIES
Time deposits	$	361,566		$	692		0.76	%	$	476,205		$	1,869		1.56	%
Brokered time deposits		0			0		0			57,000			157		1.10
Savings deposits		525,560			152		0.11			476,097			256		0.21
Demand deposits		1,278,099			502		0.16			913,946			871		0.38
Short term borrowings		5,671			0		0			4,476			14		1.24
Long term borrowings		51,767			495		3.79			76,554			303		1.57
TOTAL INTEREST-BEARING LIABILITIES		2,222,663			1,841		0.33			2,004,278			3,470		0.69
NONINTEREST-BEARING LIABILITIES AND STOCKHOLDERS' EQUITY
Demand deposits		684,419								592,539
Other liabilities		22,418								24,903
Stockholders' equity		375,208								335,982
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	3,304,708							$	2,957,702
Net interest income and interest rate spread				$	27,256		3.37	%				$	24,773		3.36	%
Net interest margin							3.47	%							3.55	%

(1) Rates are calculated on an annualized basis.

(2) Includes unamortized discounts and premiums.  Average balance and yield are computed using the average historical amortized cost.

(3) Interest on loans includes fee income of $2.8 million and $2.1 million for 2021 and 2020, respectively, and is reduced by amortization of $664 thousand and $695 thousand for 2021 and 2020, respectively.

(4) For 2021, adjustments of $87 thousand and $635 thousand, respectively, are made to tax equate income on tax exempt loans and tax exempt securities.  For 2020, adjustments of $103 thousand and $505 thousand, respectively, are made to tax equate income on tax exempt loans and tax exempt securities.  These adjustments are based on a marginal federal income tax rate of 21%, less disallowances.

44

Average Balance Sheets and Related Yields and Rates

(Dollar Amounts in Thousands)

	Nine Months Ended September 30, 2021								Nine Months Ended September 30, 2020
	AVERAGE BALANCE			INTEREST		RATE (1)			AVERAGE BALANCE			INTEREST		RATE (1)
EARNING ASSETS
Loans (3) (4)	$	1,992,003		$	70,234		4.71	%	$	2,066,178		$	73,370		4.78	%
Taxable securities (2)		524,774			7,452		1.90			205,168			4,088		2.66
Tax-exempt securities (2) (4)		327,938			8,630		3.52			246,218			7,161		3.88
Other investments		20,372			355		2.33			24,008			415		2.31
Federal funds sold and other		203,197			161		0.11			104,201			231		0.33
TOTAL EARNING ASSETS		3,068,284			86,832		3.78			2,645,773			85,265		4.35
NONEARNING ASSETS
Cash and due from banks		21,809								34,039
Premises and equipment		25,221								25,458
Allowance for loan losses		(25,055	)							(16,482	)
Unrealized gains (losses) on securities		22,669								18,414
Other assets (3)		134,538								107,137
TOTAL ASSETS	$	3,247,466							$	2,814,339
INTEREST-BEARING LIABILITIES
Time deposits	$	397,378		$	2,955		0.99	%	$	488,051		$	6,492		1.78	%
Brokered time deposits		15,692			75		0.64			82,138			959		1.56
Savings deposits		512,716			510		0.13			452,938			844		0.25
Demand deposits		1,196,910			1,861		0.21			809,619			3,357		0.55
Short term borrowings		4,395			7		0.21			26,440			352		1.78
Long term borrowings		67,335			1,075		2.13			84,483			1,102		1.74
TOTAL INTEREST-BEARING LIABILITIES		2,194,426			6,483		0.39			1,943,669			13,106		0.90
NONINTEREST-BEARING LIABILITIES AND STOCKHOLDERS' EQUITY
Demand deposits		669,255								533,400
Other liabilities		21,852								19,822
Stockholders' equity		361,933								317,448
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	3,247,466							$	2,814,339
Net interest income and interest rate spread				$	80,349		3.39	%				$	72,159		3.45	%
Net interest margin							3.50	%							3.64	%

(1) Rates are calculated on an annualized basis.  

(2) Includes unamortized discounts and premiums.  Average balance and yield are computed using the average historical amortized cost.

(3) Interest on loans includes fee income of $8.5 million and $5.0 million for 2021 and 2020, respectively, and is reduced by amortization of $2.0 million for 2021 and 2020.

(4) For 2021, adjustments of $274 thousand and $1.8 million, respectively, are made to tax equate income on tax exempt loans and tax exempt securities.  For 2020, adjustments of $299 thousand and $1.5 million, respectively, are made to tax equate income on tax exempt loans and tax exempt securities.  These adjustments are based on a marginal federal income tax rate of 21%, less disallowances.

45

Net Interest Income.  Net interest income for the three month period ended September 30, 2021, was $26.5 million compared to $24.2 million for the same period in 2020.  On a tax equivalent basis net interest income was $27.3 million for the third quarter of 2021 compared to $24.8 million for the same period in 2020.  The net interest margin to average earning assets on a fully taxable equivalent basis decreased 8 basis points to 3.47% for the three months ended September 30, 2021, compared to 3.55% for the same three month period in the prior year.  In comparing the quarters ended September 30, 2021 and 2020, yields on earning assets decreased 35 basis points, while the cost of interest bearing liabilities decreased 36 basis points.

Net interest income for the nine month period ended September 30, 2021 was $78.3 million compared to $70.4 million for the same period in 2020.  On a tax equivalent basis net interest income was $80.3 million for the nine month period ended September 30, 2021, compared to $72.2 million for the same period in 2020.  The net interest margin to average earning assets on a fully taxable equivalent basis decreased 14 basis points to 3.50% for the nine months ended September 30, 2021, compared to 3.64% for the same nine month period in the prior year.  In comparing the nine month period ended September 30, 2021 and 2020, yields on earning assets decreased 57 basis points, while the cost of interest bearing liabilities decreased 51 basis points.

Noninterest Income. Noninterest income was down slightly to $9.0 million for the quarter ended September 30, 2021, compared to $9.2 million in the same quarter in 2020.  Net gains on the sale of loans was down $1.7 million, or 53.0% for the third quarter of 2021 compared to the third quarter of 2020 due to lower origination volumes.  This decline was offset by an increase in trust fees of $362 thousand, or 18.4%, investment commissions of $285 thousand, or 80.7%, security gains of $389 thousand, or 555.7% and bank owned life insurance income of $144 thousand, or 73.5%.    For the nine month period, noninterest income increased 11.9% to $28.7 million compared to $25.7 million for the same period of 2020.  The reasons for the increases are similar to those for the third quarter discussed above.

Noninterest Expense.  Total noninterest expenses for the third quarter of 2021 decreased 2.0%, to $17.1 million, compared to $17.5 million in the same quarter in 2020.  Excluding merger related costs and a $326 thousand prepayment penalty for the payoff of a $25 million FHLB advance, noninterest expense has declined $1.1 million from the third quarter of 2020 to the third quarter of 2021.  The $342 thousand decline in noninterest expense from the third quarter of 2020 to the third quarter of 2021 was primarily due to a $923 thousand, or 9.0% decline in salaries and employee benefits, offset by an increase of $180 thousand, or 10.5%, in occupancy and equipment, $256 thousand, or 34.0% in professional fees and $414 thousand, or 713.8% in merger related expenses.  The drop in salary and employee benefits was due to lower health insurance costs compared to the same quarter in 2020 along with lower incentive compensation expense and a greater amount of contra salary expense from FAS91 deferrals.  For the nine month period ended September 30, 2021 noninterest expenses decreased 3.4%, to $51.6 million, compared to $53.4 million for the same period in 2020.  The reasons for the decreases are similar to those for the third quarter discussed above except for merger related expenses, which decreased $837 thousand, or 58.7%, for the nine month period ended September 30, 2021.

The Company’s tax equivalent efficiency ratio for the three month period ended September 30, 2021, was 46.0% compared to 50.4% for the same period in 2020.  The tax equivalent efficiency ratio for the nine month period ended September 30, 2021 was 46.5% compared to 53.5% for the nine month period ended September 30, 2020.

Income Taxes. Income tax expense totaled $3.4 million for the quarter ended September 30, 2021, and $2.4 million for the quarter ended September 30, 2020.  The effective tax rate for the three month period ended September 30, 2021 and 2020 was 17.3% and 18.4%, respectively.

Income tax expense was $9.8 million for the first nine months of 2021 and $6.0 million for the first nine months of 2020.  The effective tax rate for the nine month period ended September 30, 2021 was 17.5%, compared to 16.5% for the same period in 2020.

Financial Condition

Cash and Cash Equivalents.  Cash and cash equivalents decreased $174.8 million during the first nine months of 2021 from $254.6 million to $79.8 million.  The decrease in the cash balance was primarily due to the purchase of available for sale securities.

Securities.  Securities available-for-sale increased by $607.8 million since December 31, 2020.  The Company intends to continue purchasing securities in order to utilize excess cash on hand.

Loans.  Gross loans decreased $183.8 million since December 31, 2020.  The decrease was due to a $71.8 million decrease in PPP loans, a decline of $36.9 million in 1-4 family residential loans due to the continued level of refinance activity in 2021 and declines in commercial and commercial real estate due to a high degree of liquidity in the system that has resulted in a greater level of payoffs.    

Allowance for Loan Losses.  The following table indicates key asset quality ratios that management evaluates on an ongoing basis.  The recorded investment balances were used in the calculations.

46

Asset Quality History

(In Thousands of Dollars)

	9/30/2021			6/30/2021			3/31/2021			12/31/2020			9/30/2020
Nonperforming loans	$	14,744		$	13,873		$	11,640		$	13,835		$	11,841
Nonperforming loans as a % of total loans		0.78	%		0.71	%		0.57	%		0.67	%		0.55	%
Loans delinquent 30-89 days	$	6,944		$	7,606		$	7,183		$	9,297		$	10,134
Loans delinquent 30-89 days as a % of total loans		0.37	%		0.39	%		0.35	%		0.45	%		0.47	%
Allowance for credit losses (a)	$	23,136		$	24,806		$	24,935		$	22,144		$	19,341
Allowance for credit losses as a % of loans (a)		1.22	%		1.27	%		1.22	%		1.07	%		0.90	%
Allowance for credit losses as a % of non-acquired loans (a)		1.23	%		1.31	%		1.35	%		1.22	%		1.03	%
Allowance for credit losses as a % of nonperforming loans (a)		156.92	%		178.81	%		214.22	%		160.06	%		163.34	%
Annualized net charge-offs to average net loans outstanding		0.06	%		0.04	%		0.02	%		0.04	%		0.04	%
Non-performing assets	$	14,744		$	13,903		$	11,670		$	13,835		$	11,914
Non-performing assets as a % of total assets		0.44	%		0.43	%		0.35	%		0.45	%		0.40	%
Net charge-offs for the quarter	$	286		$	179		$	84		$	197		$	219

(a) The allowance for credit losses under CECL method is used for the periods ended September 30, 2021, June 30, 2021 and March 31, 2021 while prior periods use the incurred loss methodology.

In accordance with the accounting relief provisions of CARES and subsequent provisions of HEROES, the Bank postponed the adoption of the current expected credit losses (“CECL”) accounting standard from January 1, 2020 to January 1, 2021.  The Company adopted ASC 326 using the modified retrospective method for all financial assets measured at amortized cost and off-balance-sheet credit exposures.  Results for reporting periods beginning after January 1, 2021 are presented under ASC 326 while prior period amounts continue to be reported in accordance with previously applicable GAAP.  The Company recorded the onetime adjustment to equity in the amount of $1.9 million, net of tax which increased the allowance for credit losses $2.5 million.

Due to a decline in loan balances, a decrease in a specific reserve on one loan, and a continued decline in historical loss ratios, the Company recorded a negative provision for credit losses of $948,000 for the quarter ended September 30, 2021, compared to the $2.6 million of loan loss provision recorded in the third quarter of 2020. The Company estimates the ACL based on the amortized cost basis of the underlying loan and has made an accounting policy election to exclude accrued interest from the loan’s amortized cost basis and the related measurement of the ACL.  Estimating the amount of the ACL is a function of a number of factors, including but not limited to changes in the loan portfolio, net charge-offs, trends in past due and nonaccrual loans, and the level of potential problem loans, all of which may be susceptible to significant change. The allowance for credit losses as a percentage of the total loan portfolio was 1.22% at September 30, 2021 and 0.90% at September 30, 2020.  The loan portfolios acquired at fair market value from previous acquisitions were recorded at fair market value and without an associated allowance for loan loss.  When the acquired loans are excluded, (non-GAAP), the ratio of allowance for loan losses to total non-acquired loans is 1.23% at September 30, 2021 compared to 1.03% at September 30, 2020.  Early stage delinquencies, which are loans 30 - 89 days delinquent, as a percentage of total loans decreased from 0.47% at September 30, 2020, to 0.37% at September 30, 2021, and non-performing loans as a percentage of total loans increased from 0.55% at September 30, 2020, to 0.78% at September 30, 2021.  The allowance for credit losses to non-performing loans decreased from 163.3% at September 30, 2020, to 156.9% at September 30, 2021.

Based on the evaluation of the adequacy of the allowance for credit losses, management believes that the allowance for credit losses at September 30, 2021, is adequate and reflects the new requirements of the newly adopted CECL standard.  The provision for credit losses is based on management’s judgment after taking into consideration all factors connected with the collectability of the existing loan portfolio.  Management estimates the allowance balance using relevant available information, from internal and external sources, relating to past events, current conditions, and reasonable and supportable forecasts.  Historical credit loss experience provides the basis for the estimation of expected credit losses.  Specific factors considered by management in determining the amounts charged to operating expenses include previous credit loss experience, the status of past due interest and principal payments, the quality of financial information supplied by loan customers and the general condition of the industries in the community to which loans have been made.

47

Deposits.  Total deposits increased $255.5 million from December 31, 2020, to September 30, 2021, for a balance of $2.9 billion.  Interest bearing accounts increased a combined $188.4 million, or 9.4%, during the first nine months of 2021. The increase in interest bearing accounts is mostly due to an approximate increase of $150.0 million in public funds deposits. Money market index accounts increased as customers moved funds out of certificates of deposit during the period.  The Company also believes a portion of the deposit growth is related to business customers depositing their PPP loan proceeds in their DDA (Demand Deposit Account).  At September 30, 2021, core deposits, which include, savings and money market accounts, time deposits less than $250 thousand, demand deposits, and interest bearing demand deposits represented approximately 95.32% of total deposits.

Borrowings.  Total borrowing balances decreased from $78.9 million at December 31, 2020 to $49.6 million at September 30, 2021, due to the payoff of a $25 million FHLB advance.  

Capital Resources.  Total stockholders’ equity increased $27.4 million, or 7.8%, during the nine month period ended September 30, 2021.  The increase in equity is due primarily to the net income addition to retained earnings less the amount of dividends paid.  Shareholders received $0.11 per share in cash dividends in each of the first three quarters in 2021. Book value per share increased from $12.06 per share at December 31, 2020 to $13.33 per share at September 30, 2021.  The Company’s tangible book value per share, which is a non-GAAP measure, also increased, from $10.23 per share at December 31, 2020 to $11.61 per share at September 30, 2021.

The capital management function is a regular process that consists of providing capital for both the current financial position and the anticipated future growth of the Company.  At September 30, 2021 the Company is required to maintain 4.5% common equity tier 1 to risk weighted assets excluding the conservation buffer to be adequately capitalized.  The Company’s common equity tier 1 to risk weighted assets was 14.55%, total risk-based capital ratio stood at 16.21%, and the Tier 1 risk-based capital ratio and Tier 1 leverage ratio were at 15.14% and 10.17%, respectively, at September 30, 2021.  The Company opted not to phase in, over 3 years, the effects of the initial CECL entry to equity for the implementation of ACS 326, recorded on January 1, 2021.  Management believes that the Company and the Bank meet all capital adequacy requirements to which they are subject, as of September 30, 2021.

Federal bank regulatory agencies finalized a rule that simplifies capital requirements for community banks by allowing them to adopt a simple leverage ratio to measure capital adequacy.  The community bank leverage ratio framework removes requirements for calculating and reporting risk-based capital ratios for a qualifying community bank that opts into the framework. 

The community bank leverage ratio framework was available for banking organizations to use in their March 31, 2020, Call Report.  The Company has not elected to use the new framework as of September 30, 2021.

Critical Accounting Policies

The Company follows financial accounting and reporting policies that are in accordance with U.S. GAAP. These policies are presented in Note 1 of the consolidated audited financial statements in the Company’s Annual Report to Shareholders included in the Company’s 2020 Form 10-K.  Critical accounting policies are those policies that require management’s most difficult, subjective or complex judgments, often as a result of the need to make estimates about the effect of matters that are inherently uncertain.  The Company has identified three accounting policies that are critical accounting policies and an understanding of these policies is necessary to understand the Company’s financial statements.  These policies relate to determining the adequacy of the allowance for credit losses, for both the investment and loan portfolios and if there is any impairment of goodwill or other intangible.  Additional information regarding these policies is included in the notes to the aforementioned 2020 consolidated financial statements, Note 1 (Summary of Significant Accounting Policies), Note 2 (Business Combination), Note 4 (Loans), and the sections captioned “Loan Portfolio.”

Securities classified as AFS are those securities that the Company intends to hold for an indefinite period of time, but not necessarily to maturity.  Any decision to sell a security classified as AFS would be based on various factors, including significant movements in interest rates, changes in the maturity mix of the Company’s assets and liabilities, liquidity needs, regulatory capital considerations, and other similar factors.

48

The Company evaluates securities AFS in unrealized loss positions on a quarterly basis to determine whether the decline in fair value below the amortized costs basis (impairment) is due to credit-related factors or noncredit-related factors.  In making this evaluation, management considers the extent to which the fair value has been less than cost, the financial condition and near-term prospects of the issuer, and the intent and ability of the Company to hold the security for a period of time sufficient to allow for any anticipated recovery in fair value.  Any impairment that is not credit-related is recognized in other comprehensive income, net of related deferred income taxes.  Credit-related impairment is recognized as an allowance for credit losses (“ACL”) on the balance sheet based on the amount by which the amortized cost basis exceeds the fair value, with a corresponding charge to net income.  Both the ACL and the charge to net income may be reversed if conditions change. However, if the Company intends to sell an impaired AFS security or more likely than not will be required to sell such a security before recovering its amortized cost basis, the entire impairment amount must be recognized in net income with a corresponding adjustment to the security’s amortized cost basis rather than through the establishment of an ACL.  The Company has recorded no ACL related to the investment portfolio as of September 30, 2021.

The ACL represents management’s estimate of expected credit losses in the Company’s loan portfolio at the balance sheet date.  The Company estimates the ACL based on the amortized cost basis of the underlying loan and has made an accounting policy election to exclude accrued interest from the loan’s amortized cost basis and the related measurement of the ACL.  Estimating the amount of the ACL is a function of a number of factors, including but not limited to changes in the loan portfolio, net charge-offs, trends in past due and nonaccrual loans, and the level of potential problem loans, all of which may be susceptible to significant change.

Prior to January 1, 2021, as described in further detail in the Company’s 2020 Form 10-K, the Company used an incurred loss impairment model.  This methodology assessed the overall appropriateness of the allowance for credit losses and included allocations for specifically identified impaired loans and loss factors for all remaining loans, with a component primarily based on historical loss rates and another component primarily based on other qualitative factors.  Impaired loans were individually assessed and measured based on the present value of expected future cash flows discounted at the loan’s effective interest rate, the loan’s observable market price or the fair value of the collateral if the loan was collateral dependent.  Loans that were determined not to be impaired were collectively evaluated for impairment, stratified by type and allocated loss ranges based on the Company’s actual historical loss ratios for each strata, and adjustments were also provided for certain environmental and other qualitative factors.

On January 1, 2021, the Company adopted CECL.  This methodology also considers historical loss rates and other qualitative adjustments, as well as a new forward-looking component that considers reasonable and supportable forecasts over the expected life of each loan.  To develop the ACL estimate under the current expected loss model, the Company segments the loan portfolio into loan pools based on loan type and similar credit risk elements.  The Company uses the cohort and PD/LGD (Probability of Default/Loss Given Default) methodologies as described previously.      

U.S. GAAP establishes standards for the amortization of acquired intangible assets and the impairment assessment of goodwill.  Goodwill arising from business combinations represents the value attributable to unidentifiable intangible assets in the business acquired.  The Company’s goodwill relates to the value inherent in the banking industry and that value is dependent upon the ability of the Company’s subsidiaries to provide quality, cost-effective services in a competitive marketplace.  The goodwill value is supported by revenue that is in part driven by the volume of business transacted.  A decrease in earnings resulting from a decline in the customer base or the inability to deliver cost-effective services over sustained periods can lead to impairment of goodwill that could adversely impact earnings in future periods.  U.S. GAAP requires an annual evaluation of goodwill for impairment, or more frequently if events or changes in circumstances indicate that the asset might be impaired.  The fair value of the goodwill is estimated by reviewing the past and projected operating results for the subsidiaries and comparable industry information.

Liquidity

The Company maintains, in the opinion of management, liquidity sufficient to satisfy depositors’ requirements and meet the credit needs of customers.  The Company depends on its ability to maintain its market share of deposits as well as acquiring new funds.  The Company’s ability to attract deposits and borrow funds depends in large measure on its profitability, capitalization and overall financial condition.  The Company’s objective in liquidity management is to maintain the ability to meet loan commitments, purchase securities or to repay deposits and other liabilities in accordance with their terms without an adverse impact on current or future earnings.  Principal sources of liquidity for the Company include assets considered relatively liquid, such as federal funds sold, cash and due from banks, as well as cash flows from maturities and repayments of loans, and securities.

Along with its liquid assets, the Bank has additional sources of liquidity available which help to ensure that adequate funds are available as needed.  These other sources include, but are not limited to, loan repayments, the ability to obtain deposits through the adjustment of interest rates and the purchasing of federal funds and borrowings on approved lines of credit at major domestic banks.  At September 30, 2021, this line of credit totaled $35 million of which the Bank had not borrowed against.  In addition, the Company has two revolving lines of credit with correspondent banks totaling $6.5 million. There was no balance on this line at September 30, 2021 and the balance was $350 thousand at December 31, 2020.  Management feels that its liquidity position is adequate and continues to monitor the position on a monthly basis.  As of September 30, 2021, the Bank had outstanding balances with the Federal Home Loan Bank of $40.0 million with additional borrowing capacity of approximately $579.9 million, as well as access to the Federal Reserve Discount Window, which provides an additional source of funds.  The Bank views its membership in the FHLB as a solid source of liquidity.  

49

Off-Balance Sheet Arrangements

In the normal course of business, to meet the financial needs of our customers, we are a party to financial instruments with off-balance sheet risk.  These financial instruments generally include commitments to originate mortgage, commercial and consumer loans, and involve to varying degrees, elements of credit and interest rate risk in excess of amounts recognized in the Consolidated Balance Sheets.  The Bank’s maximum exposure to credit loss in the event of nonperformance by the borrower is represented by the contractual amount of those instruments.  Because some commitments may expire without being drawn upon, the total commitment amounts do not necessarily represent future cash requirements.  The same credit policies are used in making commitments as are used for on-balance sheet instruments.  Collateral is required in instances where deemed necessary.  Undisbursed balances of loans closed include funds not disbursed but committed for construction projects.  Unused lines of credit include funds not disbursed, but committed for, home equity, commercial and consumer lines of credit.  Financial standby letters of credit are conditional commitments issued to guarantee the performance of a customer to a third party.  Those guarantees are primarily used to support public and private borrowing arrangements.  The credit risk involved in issuing letters of credit is essentially the same as that involved in extending loan facilities to customers.  Total unused commitments were $488.1 million at September 30, 2021, and $425.5 million at December 31, 2020.  Additionally, the Company committed up to $8 million in subscriptions in Small Business Investment Company investment funds.  At September 30, 2021, the Company has invested $7 million in these funds.

Recent Market and Regulatory Developments

Various and significant legislation affecting financial institutions and the financial industry is from time to time introduced in the U.S. Congress and state legislatures, as well as by regulatory agencies.  Such initiatives may include proposals to expand or contract the powers of bank holding companies and depository institutions or proposals to substantially change the financial institution regulatory system.  

Also, such statutes, regulations and policies are continually under review by Congress, state legislatures and federal and state regulatory agencies and are subject to change at any time, particularly in the current economic and regulatory environment.  Any such change in statutes, regulations or regulatory policies applicable to the Company could have a material effect on the business of the Company.

Item 3. Quantitative and Qualitative Disclosures about Market Risk  

The Company’s ability to maximize net income is dependent, in part, on management’s ability to plan and control net interest income through management of the pricing and mix of assets and liabilities.  Because a large portion of assets and liabilities of the Company are monetary in nature, changes in interest rates and monetary or fiscal policy affect its financial condition and can have significant impact on the net income of the Company.  Additionally, the Company’s balance sheet is slightly asset sensitive and in the uncertain interest rate environment that exists today, the Company’s net interest margin could be under additional pressure should interest rates continue to remain low in the near future.

The Company considers the primary market exposure to be interest rate risk.  Simulation analysis is used to monitor the Company’s exposure to changes in interest rates, and the effect of the change to net interest income.  The following table shows the effect on net interest income and the net present value of equity in the event of a sudden and sustained 300 basis point increase or 100 basis point decrease in market interest rates:

Changes In Interest Rate (basis points)	September 30, 2021 Result			December 31, 2020 Result			ALCO Guidelines
Net Interest Income Change
+300		4.9	%		-1.6	%		-10.0	%
+200		3.4	%		-1.2	%		-7.5	%
+100		1.7	%		0.2	%		-5.0	%
-100		-5.7	%		-2.8	%		-5.0	%
Net Present Value Of Equity Change
+300		17.2	%		8.9	%		-10.0	%
+200		15.5	%		5.0	%		-7.5	%
+100		10.1	%		27.8	%		-5.0	%
-100		-22.8	%		-19.0	%		-10.0	%

It should be noted that the change in the net present value of equity and net interest income exceeded policy when the simulation model assumed a sudden decrease in rates of 100 basis points (1%).  This is primarily due to the positive impact on the fair value of

50

assets not being as great as the negative impact on the fair value of certain liabilities.  Specifically, because core deposits typically bear relatively low interest rates, their fair value would be negatively impacted as the rates could not be adjusted by the full extent of the sudden decrease in rates.  Management will continue to monitor the policy exception and may consider changes to the asset/liability position in the future.  The remaining results of the simulations indicate that interest rate change results fall within internal limits established by the Company at September 30, 2021.  A report on interest rate risk is presented to the Board of Directors and the Asset/Liability Committee on a quarterly basis.  The Company has no market risk sensitive instruments held for trading purposes, nor does it hold derivative financial instruments, and does not plan to purchase these instruments in the near future.

Item 4. Controls and Procedures

Based on their evaluation, as of the end of the period covered by this Quarterly Report on Form 10-Q, the Company’s Chief Executive Officer and Chief Financial Officer have concluded the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934) are effective.  There were no changes in the Company’s internal controls over financial reporting (as defined in Rule 13a–15(f) under the Exchange Act) that occurred during the fiscal quarter ended September 30, 2021, that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

PART II - OTHER INFORMATION

Item 1. Legal Proceedings

The Company is a defendant in lawsuits and other adversary proceedings arising in the ordinary course of business.  Legal costs incurred in connection with the resolution of claims and lawsuits are generally expensed as incurred, although the Company establishes accruals where losses are deemed probable and reasonably estimable.  The Company’s assessment of the current exposure with respect to adverse claims in legal matters could change in the event of the discovery of additional facts in such matters or upon determinations by judges, juries, administrative agencies or other finders of fact that are inconsistent with the Company’s evaluation of claims. It is possible that the ultimate resolution of matters, if unfavorable, may be material to the results of operations in a particular future period as the time and amount of any resolution of such actions and its relationship to the future results of operations are not known.

Item 1A. Risk Factors

Changes in the federal, state, or local tax laws may negatively impact our financial performance. On March 31, 2021, President Biden unveiled his infrastructure plan, which includes a proposal to increase the federal corporate tax rate from 21% to 28% as part of a package of tax reforms to help fund the spending proposals in the infrastructure plan. On April 28, 2021, President Biden announced additional significant proposals, including the American Families Plan, which are paid for largely by raising certain taxes.  Although the infrastructure plan has not reached congress, it is expected to proceed in some form this year due to the Democratic Party's slim majority in both houses of Congress. If adopted as proposed, the increase of the corporate tax rate would adversely affect our results of operations in future periods.  

For additional discussion of risk factors related to the Company, refer to Part 1, Item 1A, “Risk Factors,” contained in the Company’s 2020 Form 10-K.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Purchases of equity securities by the issuer.

On July 30, 2019, the Company announced that its Board of Directors authorized the purchase of up to 1,500,000 shares of its common stock in the open market or in privately negotiated transactions, from time to time and subject to market and other conditions.  At September 30, 2021, the Company had 549,000 shares remaining to be repurchased under this program.  There was no treasury stock activity under the program during the three month period ended September 30, 2021.

Item 3. Defaults Upon Senior Securities

Not applicable.

Item 4. Mine Safety Disclosures

Not applicable.

51

Item 5. Other Information

Not applicable.

52

Item 6. Exhibits

The following exhibits are filed or incorporated by reference as part of this report:

2.1	Agreement and Plan of Merger by and among Farmers National Banc Corp., Cortland Bancorp, and FMNB Merger Subsidiary IV, LLC, dated as of June 22, 2021 (incorporated by reference from Exhibit 2.1 to the Company’s Current Report on Form 8-K filed with the Commission on June 23, 2021).
2.2	Amendment to Agreement and Plan of Merger by and among Farmers National Banc Corp., Cortland Bancorp, and FMNB Merger Subsidiary IV, LLC, dated as of October 12, 2021 (incorporated by reference from Exhibit 2.1 to the Company’s Current Report on Form 8-K filed with the Commission on June 18, 2021).
3.1	Articles of Incorporation of Farmers National Banc Corp., as amended (incorporated by reference from Exhibit 4.1 to the Company’s Registration Statement on Form S-3 filed with the Commission on October 3, 2001 (File No. 333-70806)).
3.2	Amendment to Articles of Incorporation of Farmers National Banc Corp., as amended (incorporated by reference from Exhibit 3.1 to the Company’s Current Report on Form 8-K filed with the Commission on April 20, 2018).
3.3	Amended Code of Regulations of Farmers National Banc Corp. (incorporated by reference from Exhibit 3.1 to the Company’s Current Report on Form 8-K filed with the Commission on April 17, 2020).
31.1	Rule 13a-14(a)/15d-14(a) Certification of Kevin J. Helmick, President and Chief Executive Officer of the Company (filed herewith).
31.2	Rule 13a-14(a)/15d-14(a) Certification of Carl D. Culp, Executive Vice President, Chief Financial Officer and Treasurer of the Company (filed herewith).
32.1	Certification pursuant to 18 U.S.C. Section 1350 of Kevin J. Helmick, President and Chief Executive Officer of the Company (filed herewith).
32.2	Certification pursuant to 18 U.S.C. Section 1350 of Carl D. Culp, Executive Vice President, Chief Financial Officer and Treasurer of the Company (filed herewith).
101	The following materials from the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2021, formatted in iXBRL (Inline Extensible Business Reporting Language), filed herewith: (i) the Consolidated Balance Sheets; (ii) the Consolidated Statements of Income; (iii) the Consolidated Statements of Comprehensive Income; (iv) the Consolidated Statements of Stockholders’ Equity, (v) the Consolidated Statements of Cash Flows; and (vi) Notes to Unaudited Consolidated Financial Statements.
104	The cover page from the Company’s Quarterly report on Form 10-Q for the quarter ended June 30, 2021, has been formatted in Inline XBRL.

* Constitutes a management contract or compensatory plan or arrangement.

53

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

FARMERS NATIONAL BANC CORP.

Dated: November 4, 2021

/s/ Kevin J. Helmick

Kevin J. Helmick

President and Chief Executive Officer

Dated: November 4, 2021

/s/ A. Troy Adair

A. Troy Adair

Executive Vice President and Chief Financial Officer

54

EX-31.1

Exhibit 31.1

CERTIFICATIONS

Certification of Chief Executive Officer

CERTIFICATION FOR QUARTERLY REPORT ON FORM 10-Q

I, Kevin J. Helmick certify that:

1) I have reviewed this quarterly report on Form 10-Q of Farmers National Banc Corp.;

2) Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3) Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4) The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures, and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5) The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

November 4, 2021

/s/ Kevin J. Helmick

Kevin J. Helmick

Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATIONS

Certification of Chief Financial Officer

CERTIFICATION FOR QUARTERLY REPORT ON FORM 10-Q

I, A. Troy Adair certify that:

1) I have reviewed this quarterly report on Form 10-Q of Farmers National Banc Corp.;

2) Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3) Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4) The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures, and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5) The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

November 4, 2021

/s/ A. Troy Adair

A. Troy Adair

Chief Financial Officer

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Farmers National Banc Corp. (the “Corporation”) on Form 10-Q for the period ended September 30, 2021 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I Kevin J. Helmick, Chief Executive Officer of the Corporation, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the report fairly presents, in all material respects, the financial condition and results of operations of the Corporation.

/s/ Kevin J. Helmick

Kevin J. Helmick

Chief Executive Officer

November 4, 2021

EX-32.2

Exhibit 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Farmers National Banc Corp. (the “Corporation”) on Form 10-Q for the period ended September 30, 2021 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I A. Troy Adair, Chief Financial Officer of the Corporation, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the report fairly presents, in all material respects, the financial condition and results of operations of the Corporation.

/s/ A. Troy Adair

A. Troy Adair

Chief Financial Officer

November 4, 2021

XML

Document and Entity Information - shares	9 Months Ended
	Sep. 30, 2021	Oct. 31, 2021
Cover [Abstract]
Entity Registrant Name	FARMERS NATIONAL BANC CORP.
Entity Central Index Key	0000709337
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Document Type	10-Q
Document Period End Date	Sep. 30, 2021
Amendment Flag	false
Document Fiscal Year Focus	2021
Document Fiscal Period Focus	Q3
Current Fiscal Year End Date	--12-31
Entity Filer Category	Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Common Stock, Shares Outstanding		28,321,581
Entity Shell Company	false
Title of 12(b) Security	Common Stock, No Par Value
Trading Symbol	FMNB
Security Exchange Name	NASDAQ
Entity File Number	001-35296
Entity Incorporation, State or Country Code	OH
Entity Tax Identification Number	34-1371693
Entity Address, Address Line One	20 South Broad Street
Entity Address, City or Town	Canfield
Entity Address, State or Province	OH
Entity Address, Postal Zip Code	44406
City Area Code	330
Local Phone Number	533-3341
Document Quarterly Report	true
Document Transition Report	false

XML

Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands	Sep. 30, 2021	Dec. 31, 2020
ASSETS
Cash and due from banks	$ 26,933	$ 20,503
Federal funds sold and other	52,875	234,118
TOTAL CASH AND CASH EQUIVALENTS	79,808	254,621
Securities available for sale	1,183,361	575,600
Other investments	19,041	21,528
Loans held for sale	2,628	4,766
Loans	1,894,216	2,078,044
Less allowance for loan losses	23,136	22,144
NET LOANS	1,871,080	2,055,900
Premises and equipment, net	24,790	25,620
Goodwill	45,775	45,775
Other intangibles, net	2,895	3,842
Bank owned life insurance	51,894	51,322
Other assets	35,775	32,174
TOTAL ASSETS	3,317,047	3,071,148
Deposits:
Noninterest-bearing	675,938	608,791
Interest-bearing	2,190,475	1,970,087
Brokered time deposits	0	32,000
TOTAL DEPOSITS	2,866,413	2,610,878
Short-term borrowings	0	2,521
Long-term borrowings	49,649	76,385
Other liabilities	23,461	31,267
TOTAL LIABILITIES	2,939,523	2,721,051
Commitments and contingent liabilities
Stockholders' Equity:
Common Stock - Authorized 50,000,000 shares; issued 29,577,827 in 2021 and 2020	208,539	208,763
Retained earnings	172,939	138,073
Accumulated other comprehensive income	14,260	22,032
Treasury stock, at cost; 1,256,246 shares in 2021 and 1,319,890 in 2020	(18,214)	(18,771)
TOTAL STOCKHOLDERS' EQUITY	377,524	350,097
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$ 3,317,047	$ 3,071,148

XML

Consolidated Balance Sheets (Unaudited) (Parenthetical) - shares	Sep. 30, 2021	Dec. 31, 2020
Statement Of Financial Position [Abstract]
Common stock, shares authorized	50,000,000	50,000,000
Common stock, shares issued	29,577,827	29,577,827
Treasury stock, shares	1,256,246	1,319,890

XML

Consolidated Statements of Income (Unaudited) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
INTEREST AND DIVIDEND INCOME
Loans, including fees	$ 22,578	$ 24,228	$ 69,960	$ 73,071
Taxable securities	3,222	1,263	7,452	4,088
Tax exempt securities	2,430	1,954	6,846	5,689
Dividends	113	138	355	415
Federal funds sold and other interest income	32	52	161	231
TOTAL INTEREST AND DIVIDEND INCOME	28,375	27,635	84,774	83,494
INTEREST EXPENSE
Deposits	1,346	3,153	5,401	11,652
Short-term borrowings	0	14	7	352
Long-term borrowings	495	303	1,075	1,102
TOTAL INTEREST EXPENSE	1,841	3,470	6,483	13,106
NET INTEREST INCOME	26,534	24,165	78,291	70,388
Provision (credit) for credit losses	(947)	2,600	(472)	6,100
Provision (credit) for unfunded loans	(1)	0	(1)	0
NET INTEREST INCOME AFTER PROVISION FOR CREDIT LOSSES	27,482	21,565	78,764	64,288
NONINTEREST INCOME
Bank owned life insurance income, including death benefit	340	196	924	608
Security gains (losses), including fair value changes for equity securities	459	70	979	201
Net gains on sale of loans	1,466	3,119	6,557	7,754
Other mortgage banking income , net	32	(21)	(138)	(194)
Other operating income	560	450	2,039	1,436
TOTAL NONINTEREST INCOME	9,015	9,217	28,706	25,662
NONINTEREST EXPENSES
Salaries and employee benefits	9,321	10,244	29,163	30,188
Occupancy and equipment	1,899	1,719	6,064	5,194
State and local taxes	552	576	1,657	1,623
Professional fees	1,009	753	2,895	2,392
Merger related costs	472	58	588	1,425
Advertising	391	460	847	1,053
FDIC insurance	140	200	430	650
Intangible amortization	316	332	948	995
Core processing charges	860	925	2,318	2,720
Telephone and data	117	182	394	733
Other operating expenses	2,051	2,021	6,262	6,413
TOTAL NONINTEREST EXPENSES	17,128	17,470	51,566	53,386
INCOME BEFORE INCOME TAXES	19,369	13,312	55,904	36,564
INCOME TAXES	3,358	2,443	9,762	6,045
NET INCOME	$ 16,011	$ 10,869	$ 46,142	$ 30,519
EARNINGS PER SHARE - basic	$ 0.57	$ 0.39	$ 1.63	$ 1.08
EARNINGS PER SHARE - fully diluted	$ 0.56	$ 0.38	$ 1.63	$ 1.07
Service Charges on Deposit Accounts
NONINTEREST INCOME
Noninterest income	$ 924	$ 904	$ 2,522	$ 2,752
Trust Fees
NONINTEREST INCOME
Noninterest income	2,335	1,973	6,929	5,682
Insurance Agency Commissions
NONINTEREST INCOME
Noninterest income	799	784	2,748	2,348
Retirement Plan Consulting Fees
NONINTEREST INCOME
Noninterest income	334	341	1,043	1,129
Investment Commissions
NONINTEREST INCOME
Noninterest income	638	353	1,665	1,080
Debit Card and EFT Fees
NONINTEREST INCOME
Noninterest income	$ 1,128	$ 1,048	$ 3,438	$ 2,866

XML

Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) $ in Thousands		3 Months Ended		9 Months Ended
		Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Statement Of Income And Comprehensive Income [Abstract]
NET INCOME		$ 16,011	$ 10,869	$ 46,142	$ 30,519
Other comprehensive income:
Net unrealized holding gains (losses) on available for sale securities		(2,754)	700	(8,990)	13,894
Reclassification adjustment for (gains) realized in income	[1]	464	48	848	318
Net unrealized holding gains		(3,218)	652	(9,838)	13,576
Income tax effect		674	(138)	2,066	(2,852)
Other comprehensive income (loss), net of tax		(2,544)	514	(7,772)	10,724
TOTAL COMPREHENSIVE INCOME		$ 13,467	$ 11,383	$ 38,370	$ 41,243

[1] Pre-tax reclassification adjustments relating to available-for-sale securities are reported in security gains and the tax impact is included in income tax expense on the consolidated statements of income.

XML

Consolidated Statements of Stockholders' Equity (Unaudited) - USD ($) $ in Thousands	Total	COMMON STOCK	RETAINED EARNINGS	RETAINED EARNINGS Cumulative Impact of ASU 2016-13 Adoption (CECL)	ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)	TREASURY STOCK, AT COST
Beginning balance at Dec. 31, 2019		$ 186,345	$ 108,851	$ 0	$ 9,826	$ (5,713)
Net income	$ 30,519		30,519
Dividends declared			(9,552)
Other comprehensive income (loss)	10,724				10,724
Purchased shares						(14,238)
Issued shares under the Long Term Incentive Plan						1,305
Retained shares to cover tax withholdings under the Long Term Incentive Plan						(398)
Issued treasury shares under the Long Term Incentive Plan		(1,305)
Shares issued in contingent payments as part of a business combination		22,554
Stock compensation expense for unvested shares		1,050
Ending balance at Sep. 30, 2020	339,968	208,644	129,818		20,550	(19,044)
Beginning balance at Jun. 30, 2020		208,390	122,061		20,036	(19,135)
Net income	10,869		10,869
Dividends declared			(3,112)
Other comprehensive income (loss)	514				514
Issued shares under the Long Term Incentive Plan						110
Retained shares to cover tax withholdings under the Long Term Incentive Plan						(19)
Issued treasury shares under the Long Term Incentive Plan		(110)
Stock compensation expense for unvested shares		364
Ending balance at Sep. 30, 2020	339,968	208,644	129,818		20,550	(19,044)
Beginning balance at Dec. 31, 2020	350,097	208,763	138,073	$ (1,936)	22,032	(18,771)
Net income	$ 46,142		46,142
Accounting Standards Update [Extensible List]	ASU 2016-13
Dividends declared			(9,340)
Other comprehensive income (loss)	$ (7,772)				(7,772)
Purchased shares						(116)
Issued shares under the Long Term Incentive Plan						1,089
Retained shares to cover tax withholdings under the Long Term Incentive Plan						(416)
Issued treasury shares under the Long Term Incentive Plan		(1,089)
Shares issued in contingent payments as part of a business combination		0
Stock compensation expense for unvested shares		865
Ending balance at Sep. 30, 2021	377,524	208,539	172,939		14,260	(18,214)
Beginning balance at Jun. 30, 2021		208,312	160,042		16,804	(18,250)
Net income	16,011		16,011
Dividends declared			(3,114)
Other comprehensive income (loss)	(2,544)				(2,544)
Issued shares under the Long Term Incentive Plan						51
Retained shares to cover tax withholdings under the Long Term Incentive Plan						(15)
Issued treasury shares under the Long Term Incentive Plan		(51)
Stock compensation expense for unvested shares		278
Ending balance at Sep. 30, 2021	$ 377,524	$ 208,539	$ 172,939		$ 14,260	$ (18,214)

XML

Consolidated Statements of Stockholders' Equity (Parenthetical) Unaudited - $ / shares	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
COMMON STOCK
Treasury shares issued under the Long Term Incentive Plan	2,445	6,439	74,522	60,242
Shares issued as part of a business combination				1,398,229
RETAINED EARNINGS
Cash dividend declared per share of common stock	$ 0.11	$ 0.11	$ 0.33	$ 0.33
TREASURY STOCK, AT COST
Shares issued under long term incentive plan	3,499	8,000	106,102	95,389
Treasury stock repurchased			8,120	942,967
Shares retained to cover tax withholdings under the Long Term Incentive Plan	1,054	1,561	31,580	35,147

XML

Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020
CASH FLOWS FROM OPERATING ACTIVITIES
Net income	$ 46,142	$ 30,519
Adjustments to reconcile net income to net cash from operating activities:
Provision (credit) for credit losses	(472)	6,100
Provision (credit) for unfunded loans	(1)	0
Depreciation and amortization	2,429	2,317
Net amortization of securities	2,254	1,782
Available for sale security gain	(838)	(318)
Realized (gains) losses on equity securities	(141)	117
Loss on premises and equipment sales and disposals, net	52	77
Stock compensation expense	865	1,050
Loss on adjustment of other real estate owned	0	4
Earnings on bank owned life insurance	(884)	(608)
Income recognized from death benefit on bank owned life insurance	(40)	0
Origination of loans held for sale	(236,319)	(180,876)
Proceeds from loans held for sale	244,876	184,772
Net gains on sale of loans	(6,557)	(7,754)
Net change in other assets and liabilities	(11,409)	(10,493)
NET CASH FROM OPERATING ACTIVITIES	39,957	26,689
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from maturities and repayments of securities available for sale	48,681	37,371
Proceeds from sales of securities available for sale	35,176	17,664
Purchases of securities available for sale	(702,871)	(61,450)
Proceeds from sales of equity securities	87	54
Purchase of equity securities	(48)	(868)
Proceeds from maturities and repayments of SBIC funds	1,103	0
Purchases of SBIC funds	(784)	0
Proceeds from redemption of restricted stock	2,145	5,061
Purchase of restricted stock	(22)	(2,843)
Loan originations and payments, net	185,293	(155,658)
Proceeds from sale of other real estate owned	0	126
Proceeds from BOLI death benefit	352	0
Proceeds from land and building sales	0	502
Additions to premises and equipment	(460)	(3,623)
Net cash paid in business combinations	0	(8,136)
NET CASH FROM INVESTING ACTIVITIES	(431,348)	(171,800)
CASH FLOWS FROM FINANCING ACTIVITIES
Net change in deposits	255,535	346,117
Net change in short-term borrowings	(2,521)	(46,858)
Repayment of long-term borrowings	(26,980)	(1,779)
Cash dividends paid	(9,340)	(9,316)
Repurchase of common shares	(116)	(14,238)
NET CASH FROM FINANCING ACTIVITIES	216,578	273,926
NET CHANGE IN CASH AND CASH EQUIVALENTS	(174,813)	128,815
Beginning cash and cash equivalents	254,621	70,760
Ending cash and cash equivalents	79,808	199,575
Supplemental cash flow information:
Interest paid	6,782	13,367
Income taxes paid	9,400	7,200
Supplemental noncash disclosures:
Transfer of loans to other real estate	0	73
Security purchases not settled	0	2,466
Issuance of stock awards	1,089	1,305
Issuance of stock for business combinations	$ 0	$ 22,554

XML

Summary of Significant Accounting Policies

9 Months Ended

Sep. 30, 2021

Accounting Policies [Abstract]

Summary of Significant Accounting Policies

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

Principles of Consolidation:

Farmers National Banc Corp. (“Company”) is a Financial Holding Company registered under the Bank Holding Company Act of 1956, as amended.  The Company provides full banking services through its nationally chartered subsidiary, The Farmers National Bank of Canfield (“Bank”).  The consolidated financial statements also include the accounts of the Bank’s subsidiaries; Farmers National Insurance, LLC (“Insurance”) and Farmers of Canfield Investment Co. (“Investments”).  The Company provides trust and retirement consulting services through its subsidiary, Farmers Trust Company (“Trust”), and insurance services through the Bank’s subsidiary, Insurance.  Farmers National Captive, Inc. (“Captive”) is a wholly-owned insurance subsidiary of the Company that provides property and casualty insurance coverage to the Company and its subsidiaries.  The Captive pools resources with eleven other similar insurance company subsidiaries of financial institutions to spread a limited amount of risk among themselves and to provide insurance where not currently available or economically feasible in today’s insurance market place.  The consolidated financial statements include the accounts of the Company, the Bank and its subsidiaries, along with the Trust and Captive.  All significant intercompany balances and transactions have been eliminated in the consolidation.

Basis of Presentation:

The unaudited condensed consolidated financial statements have been prepared in conformity with the instructions to Form 10-Q and Article 10 of Regulation S-X.  Accordingly, they do not include all of the information and footnotes required by U.S. generally accepted accounting principles (“U.S. GAAP”) for complete financial statements.  The financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s 2020 Annual Report to Shareholders included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020 (“2020 Form 10-K”).  The interim consolidated financial statements include all adjustments (consisting of only normal recurring items) that, in the opinion of management, are necessary for a fair presentation of the financial position and results of operations for the periods presented.  The results of operations for the interim periods disclosed herein are not necessarily indicative of the results that may be expected for a full year.  Certain items included in the prior period financial statements were reclassified to conform to the current period presentation. There was no effect on net income or total stockholders’ equity.

Estimates:

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.  Actual results could differ from those estimates.

Segments:

The Company provides a broad range of financial services to individuals and companies in northeastern Ohio and western Pennsylvania.  Operations are managed and financial performance is primarily aggregated and reported in two lines of business, the Bank segment and the Trust segment.

Equity:

There are 50,000,000 shares authorized and available for issuance as of September 30, 2021.  Outstanding shares at September 30, 2021 were 28,321,581.

Comprehensive Income:

Comprehensive income consists of net income and other comprehensive income.  Other comprehensive income consists of unrealized gains and losses on securities available for sale which are recognized as components of stockholders’ equity, net of tax effect.

Updates to Significant Accounting Policies:

Allowance for Credit Losses – Available-for-Sale Securities:  

Securities classified as AFS are those securities that the Company intends to hold for an indefinite period of time, but not necessarily to maturity.  Any decision to sell a security classified as AFS would be based on various factors, including significant movements in interest rates, changes in the maturity mix of the Company’s assets and liabilities, liquidity needs, regulatory capital considerations, and other similar factors.

The Company evaluates AFS securities that are in an unrealized loss position on a quarterly basis to determine whether the decline in fair value below the amortized costs basis is due to credit-related factors or noncredit-related factors.  In making this evaluation, management considers the extent to which the fair value has been less than cost, the financial condition and near-term prospects of the issuer, and the intent and ability of the Company to hold the security for a period of time sufficient to allow for any anticipated recovery in fair value.  Any impairment that is not credit-related is recognized in other comprehensive income, net of related deferred income taxes.  Credit-related impairment is recognized as an allowance for credit losses (“ACL”) on the balance sheet based on the amount by which the amortized cost basis exceeds the fair value, with a corresponding charge to net income.  Both the ACL and the charge to net income may be reversed if conditions change.  However, if the Company intends to sell an impaired AFS security or more likely than not will be required to sell such a security before recovering its amortized cost basis, the entire impairment amount must be recognized in net income with a corresponding adjustment to the security’s amortized cost basis rather than through the establishment of an ACL.  The Company has recorded no ACL related to the investment portfolio as of September 30, 2021.

Allowance for Credit Losses – Loans:  

The ACL represents management’s estimate of expected credit losses in the Company’s loan portfolio at the balance sheet date.  The Company estimates the ACL based on the amortized cost basis of the underlying loan and has made an accounting policy election to exclude accrued interest from the loan’s amortized cost basis and the related measurement of the ACL.  Estimating the amount of the ACL is a function of a number of factors, including but not limited to changes in the loan portfolio, net charge-offs, trends in past due and nonaccrual loans, and the level of potential problem loans, all of which may be susceptible to significant change.

Prior to January 1, 2021, as described in further detail in the Company’s 2020 Form 10-K, the Company used an incurred loss impairment model.  This methodology assessed the overall appropriateness of the allowance for credit losses and included allocations for specifically identified impaired loans and loss factors for all remaining loans, with a component primarily based on historical loss rates and another component primarily based on other qualitative factors.  Impaired loans were individually assessed and measured based on the present value of expected future cash flows discounted at the loan’s effective interest rate, the loan’s observable market price or the fair value of the collateral if the loan was collateral dependent.  Loans that were determined not to be impaired were collectively evaluated for impairment, stratified by type and allocated loss ranges based on the Company’s actual historical loss ratios for each strata, and adjustments were also provided for certain environmental and other qualitative factors.

On January 1, 2021, the Company adopted the current expected credit loss model (“CECL”).  This methodology for calculating the allowance for credit losses considers the possibility of loss over the life of the loan.  It also considers historical loss rates and other qualitative adjustments, as well as a new forward-looking component that considers reasonable and supportable forecasts over the expected life of each loan.  To develop the ACL estimate under the current expected loss model, the Company segments the loan portfolio into loan pools based on loan type and similar credit risk elements.  The Company uses the cohort (“cohort”) and the probability of default/loss given default (“PD/LGD”) methodologies as described in the Credit Quality Indicators section of the loan footnote. Under ASC 326, if a loan does not share similar risk characteristics with loans in that pool, expected credit losses for that loan are evaluated individually.  The Bank has established specific thresholds for the loan portfolio that trigger when loans need to be evaluated individually.    

In addition, ASC Topic 326 requires the Company to establish a separate liability for anticipated credit losses for unfunded commitments.  The Company previously included this reserve in the ACL but it is now recorded as a reserve in other liabilities.  As of September 30, 2021 the balance was $437 thousand.

Risks and Uncertainties:

The outbreak of COVID-19 has adversely impacted a broad range of industries in which the Company’s customers operate and could impair their ability to fulfill their financial obligations to the Company.  In addition, it has caused disruptions in the economy and has disrupted banking and other financial activity in the areas in which the Company operates, including but not limited to the current interest rate environment, increased inflation pressure, borrower and counterparty credit quality and market volatility.  While there has been no material impact to the Company’s business continuity or financial condition, the possibility of future challenges relating to COVID-19 remains.  

Congress, the President, and the Federal Reserve have taken several actions designed to cushion the economic fallout.  Most notably, the Coronavirus Aid, Relief and Economic Security Act (“CARES”) and the Health and Economic Recovery Omnibus Emergency Solutions Act (“HEROES”), both signed into law during 2020, were multi trillion dollar legislative packages, and the American Rescue Plan Act (“American Rescue Plan”) signed into law on March 11, 2021, was a $1.9 trillion COVID-19 relief bill.  The goal of these acts was to provide economic stability during the pandemic through various measures, including direct financial aid to American families and economic stimulus to significantly impacted industry sectors.  The packages also included extensive emergency funding for hospitals and providers. The American Rescue Plan continued these measures by funding increases in vaccine distribution, additional cash payments to millions of Americans, extended unemployment benefits, and support for caregiving, nutrition programs, health care and pensions.  In addition to the general impact of COVID-19, certain provisions of these legislative acts, as well as other recent legislative and regulatory relief efforts, have had a material impact on the Company’s operations.

The Company’s business is dependent upon the willingness and ability of its employees and customers to conduct banking and other financial transactions.  If the global response to contain COVID-19, and any new variants, continues for an extended period or is ultimately unsuccessful, the Company could experience a material adverse effect on its business, financial condition, results of operations and cash flows.  While it is not possible to know the full universe or extent that the impact of COVID-19 will have on the Company’s operations, the Company will disclose potentially material items of which it becomes aware.

Financial position and results of operations:

A majority of the Company’s fee income declined and could be reduced further due to lingering COVID-19 affects.  In keeping with guidance from regulators, the Company worked with COVID-19 affected customers to waive fees from a variety of sources, such as, but not limited to, insufficient funds and overdraft fees, ATM fees, account maintenance fees.  From the beginning of the pandemic in 2020 through the quarter ended September 30, 2021, the Company has waived $780 thousand in fees.  The Company recognizes that the breadth of the economic impact is likely to continue impacting its fee income in future periods.

The Company’s interest income improved in the quarter ended September 30, 2021, compared to the same period in 2020 and yet the net interest margin decreased by 8 basis points.  The margin could be reduced further due to COVID-19 and the continued low interest rate environment.  In keeping with guidance from regulators, the Company worked with COVID-19 affected borrowers to defer their payments.  Currently the Bank has one loan remaining that is deferring its loan payment.  While interest and fees will still accrue to income, through normal GAAP accounting, should eventual credit losses on these deferred payments emerge, interest income and fees accrued would need to be reversed.  In such a scenario, interest income in future periods could be negatively impacted.  At this time, the Company is unable to project the materiality of such an impact, but recognizes the breadth of the economic impact may affect its borrowers’ ability to repay in future periods.

Capital and liquidity:

While the Company believes that it has sufficient capital to withstand an extended economic recession brought about by COVID-19, its reported and regulatory capital ratios could be adversely impacted by further credit losses.  The Company relies on cash on hand as well as dividends from its subsidiaries.  If the Company’s capital deteriorates such that the Bank is unable to pay dividends to it for an extended period of time, the Company may not be able to pay dividends to shareholders.

The Company maintains access to multiple sources of liquidity.  Wholesale funding markets have remained open.  Rates for short term funding have recently been low but if funding costs are elevated for an extended period of time, it could have an adverse effect on the Company’s net interest margin.  If an extended recession caused large numbers of the Company’s deposit customers to withdraw their funds, the Company might become more reliant on volatile or more expensive sources of funding.

New Accounting Standards:

In June 2016, the FASB issued ASU 2016-13: Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (modified by ASU 2019-04, Codification Improvements to Topic 326, Financial Instruments Credit Losses).  The ASU requires an organization to measure all expected credit losses for financial assets held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts.  Financial institutions and other organizations will now use forward-looking information to better inform their credit loss estimates.  Many of the loss estimation techniques applied today will still be permitted, although the inputs to those techniques changed to reflect the full amount of expected credit losses.  Organizations will continue to use judgment to determine which loss estimation method is appropriate for their circumstances.  Additionally, the ASU amends the accounting for credit losses on available for sale debt securities and purchased financial assets with credit deterioration.  ASU 2016-13 is effective for public companies for annual periods beginning after December 15, 2019.  Entities will apply the standard’s provisions as a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is adopted.

In accordance with the accounting relief provisions of CARES and subsequent provisions of HEROES, the Bank postponed the adoption of the current expected credit losses (“CECL”) accounting standard from January 1, 2020 to January 1, 2021.  The Company adopted ASC 326 using the modified retrospective method for all financial assets measured at amortized cost and off-balance-sheet credit exposures.  Results for reporting periods beginning after January 1, 2021 are presented under ASC 326 while prior period amounts continue to be reported in accordance with previously applicable GAAP.  The Company recorded the onetime adjustment to equity in the amount of $1.9 million, net of tax which increased the allowance for credit losses $2.5 million.

XML

Business Combinations

9 Months Ended

Sep. 30, 2021

Business Combinations [Abstract]

Business Combinations

Business Combinations:

On November 1, 2021, the Company completed the merger with Cortland Bancorp Inc. (“Cortland”), the parent company of The Cortland Savings and Banking Company (“Cortland Bank”), pursuant to the Agreement and Plan of Merger, dated as of June 22, 2021, as amended by that certain Amendment to Agreement and Plan of Merger, dated October 12, 2021 (collectively, the “Merger Agreement”), by and among the Company, Cortland, and FMNB Merger Subsidiary IV, LLC, a wholly-owned subsidiary of the Company (“Merger Sub”).  Pursuant to the terms of the Merger Agreement, on November 1, 2021, Cortland merged with and into Merger Sub (the “Merger”), with Merger Sub as the surviving entity in the Merger.  Promptly following the consummation of the Merger, Merger Sub was dissolved and liquidated and Cortland Bank merged with and into the Bank (the “Bank Merger”), with the Bank as the surviving bank in the Bank Merger.  The transaction received the approval of Cortland’s shareholders and all customary regulatory approvals.  Pursuant to the terms of the Merger Agreement, at the effective time of the Merger, each common share, without par value, of Cortland issued and outstanding immediately prior to the effective time (except for certain Cortland common shares held directly by Cortland or the Company) was converted into the right to receive, without interest, $28.00 per share in cash or 1.75 shares of the Company’s common stock, subject to an overall limitation of 75% of the Cortland shares being exchanged for the Company’s shares and the remaining 25% being exchanged for cash.

As of September 30, 2021, Cortland had total assets of $799.2 million, which included gross loans of $500.0 million, deposits of $693.0 million and equity of $83.0 million.  Cortland Bank has branches located in Trumbull, Mahoning, Portage, Summit and Cuyahoga Counties in Ohio.

On January 7, 2020, the Company completed the acquisition of Maple Leaf Financial, Inc. (“Maple Leaf”), the parent company of Geauga Savings Bank, with branches located in Cuyahoga and Geauga Counties in Ohio.  The Company is experiencing increased synergies and cost savings resulting from the combination of the two companies.  The transaction involved both cash and 1,398,229 shares of stock totaling $43.0 million.  Pursuant to the terms of the Merger Agreement, common shareholders of Maple Leaf had the right to receive $640.00 in cash or 45.5948 common shares, without par value, of the Company.  Holders of outstanding and unexercised warrants to purchase Maple Leaf Common Shares received an amount in cash equal to the excess of $640.00 over $370.00, the exercise price of such warrants.

Goodwill of $7.6 million, which is recorded on the balance sheet, arising from the acquisition consisted largely of synergies and the cost savings resulting from the combining of the entities.  The goodwill was determined not to be deductible for income tax purposes.  

The following table summarizes the consideration paid for Maple Leaf and the amounts of the assets acquired and liabilities assumed on the closing date of the acquisition.

(In Thousands of Dollars)
Consideration
Cash	$	20,423
Stock		22,554
Fair value of total consideration transferred	$	42,977
Fair value of assets acquired
Cash and due from financial institutions	$	18,219
Securities available for sale		69,547
Loans		181,280
Premises and equipment		229
Core deposit intangible		725
Other assets		6,398
Total assets		276,398
Fair value of liabilities assumed
Deposits		183,251
Long-term borrowings		54,487
Accrued interest payable and other liabilities		3,257
Total liabilities	$	240,995
Net assets acquired		35,403
Goodwill created		7,574
Total net assets acquired	$	42,977

The following table presents pro forma information as if the Maple Leaf acquisition that occurred during January 2020 actually took place at the beginning of 2020.  The pro forma information includes adjustments for merger related costs, amortization of intangibles arising from the transaction and the related income tax effects.  The pro forma financial information is not necessarily indicative of the results of operations that would have occurred had the transactions been effective on the assumed date.

(In thousands of dollars except per share results)	For Nine Months Ended Sept. 30, 2020
Net interest income	$	70,568
Net income	$	30,539
Basic earnings per share	$	1.08
Diluted earnings per share	$	1.07

XML

Securities

9 Months Ended

Sep. 30, 2021

Investments Debt And Equity Securities [Abstract]

Securities

Securities:

The following table summarizes the amortized cost and fair value of the available for sale investment securities portfolio at September 30, 2021 and December 31, 2020 and the corresponding amounts of unrealized gains and losses recognized in accumulated other comprehensive income:

			Gross		Gross
	Amortized		Unrealized		Unrealized
(In Thousands of Dollars)	Cost		Gains		Losses			Fair Value
September 30, 2021
U.S. Treasury and U.S. government sponsored entities	$	89,919	$	53	$	(1,502	)	$	88,470
State and political subdivisions		485,125		22,776		(618	)		507,283
Corporate bonds		3,604		77		(14	)		3,667
Mortgage-backed securities - residential		569,235		2,778		(5,909	)		566,104
Collateralized mortgage obligations - residential		12,956		290		(5	)		13,241
Small Business Administration		4,471		125		0			4,596
Totals	$	1,165,310	$	26,099	$	(8,048	)	$	1,183,361

			Gross		Gross
	Amortized		Unrealized		Unrealized
(In Thousands of Dollars)	Cost		Gains		Losses			Fair Value
December 31, 2020
U.S. Treasury and U.S. government sponsored entities	$	11,798	$	101	$	(54	)	$	11,845
State and political subdivisions		344,160		22,350		(204	)		366,306
Corporate bonds		3,582		132		(2	)		3,712
Mortgage-backed securities - residential		157,106		4,919		(243	)		161,782
Collateralized mortgage obligations - residential		25,654		742		(3	)		26,393
Small Business Administration		5,411		151		0			5,562
Totals	$	547,711	$	28,395	$	(506	)	$	575,600

Proceeds from the sale of portfolio securities were $8.2 million and $35.2 million during the three and nine month periods ended September 30, 2021, respectively.  Gross gains of $458 thousand and $1.4 million along with gross losses of $1 thousand and $515 thousand were realized on these sales during the three and nine month periods ended September 30, 2021.  $5 thousand and $141 thousand of realized gains, for equity securities, were recognized in the income statement during the three and nine month periods ended September 30, 2021, respectively.

Proceeds from the sale of portfolio securities were $2.3 million during the three month and $17.7 million during the nine month periods ended September 30, 2020.  Gross gains were $48 thousand and $330 thousand for the three and nine month periods ended September 30, 2020, respectively.  There were $0 gross losses for the three month period and $12 thousand of realized losses for the nine month period ended September 30, 2020. $22 thousand of realized gains and $117 thousand of realized losses, related to equity securities, were recognized in income during the three and nine month periods ended September 30, 2020, respectively.

The amortized cost and fair value of the debt securities portfolio are shown by expected maturity.  Expected maturities may differ from contractual maturities if issuers have the right to call or prepay obligations with or without call or prepayment penalties. Securities not due at a single maturity date are shown separately.

	September 30, 2021
(In Thousands of Dollars)	Amortized Cost		Fair Value
Maturity
Within one year	$	3,791	$	3,820
One to five years		10,360		10,967
Five to ten years		125,179		125,944
Beyond ten years		439,318		458,689
Mortgage-backed, collateralized mortgage obligations and Small Business Administration securities		586,662		583,941
Total	$	1,165,310	$	1,183,361

The following table summarizes the available for sale investment securities with unrealized losses at September 30, 2021 and December 31, 2020, aggregated by major security type and length of time in a continuous unrealized loss position.   

	Less than 12 Months					12 Months or Longer					Total
	Fair		Unrealized			Fair		Unrealized			Fair		Unrealized
(In Thousands of Dollars)	Value		Loss			Value		Loss			Value		Loss
September 30, 2021
U.S. Treasury and U.S. government sponsored entities	$	84,849	$	(1,479	)	$	627	$	(23	)	$	85,476	$	(1,502	)
State and political subdivisions		64,442		(562	)		4,579		(56	)		69,021		(618	)
Corporate bonds		533		(11	)		197		(3	)		730		(14	)
Mortgage-backed securities - residential		390,783		(5,909	)		10		0			390,793		(5,909	)
Collateralized mortgage obligations - residential		1,419		(2	)		249		(3	)		1,668		(5	)
Total	$	542,026	$	(7,963	)	$	5,662	$	(85	)	$	547,688	$	(8,048	)

	Less than 12 Months					12 Months or Longer				Total
	Fair		Unrealized			Fair		Unrealized		Fair		Unrealized
(In Thousands of Dollars)	Value		Loss			Value		Loss		Value		Loss
December 31, 2020
U.S. Treasury and U.S. government sponsored entities	$	8,153	$	(54	)	$	0	$	0	$	8,153	$	(54	)
State and political subdivisions		19,205		(204	)		0		0		19,205		(204	)
Corporate bonds		198		(2	)		0		0		198		(2	)
Mortgage-backed securities - residential		63,401		(243	)		0		0		63,401		(243	)
Collateralized mortgage obligations - residential		294		(3	)		0		0		294		(3	)
Total	$	91,251	$	(506	)	$	0	$	0	$	91,251	$	(506	)

Allowance for Credit Losses

The Company has adopted ASU 2016-13 that makes improvements to the accounting for credit losses on securities available for sale.  The concept of other than-temporarily impaired securities has been replaced with the allowance for credit losses.  Securities available for sale are evaluated on an individual level and pooling of securities is no longer an option.  During this evaluation process, management considers the extent to which the fair value has been less than cost, the financial condition and near term prospects of the issuer, and the intent and ability of the Company to hold the security for a period of time sufficient to allow for any anticipated recovery in fair value.      

If the Company determines that a credit loss exists, the credit portion of the allowance will be measured using a discounted cash flow analysis using the effective interest rate as of the security’s purchase date.  As of September 30, 2021, the Company’s security portfolio consisted of 718 securities, 146 of which were in an unrealized loss position.  The majority of the unrealized losses on the Company’s securities are related to its holdings of U.S. Treasury and U.S. government sponsored entities and mortgage-backed securities.  The Company does not consider its AFS securities with unrealized losses to be attributable to credit-related factors, as the

unrealized losses have occurred as a result of changes in noncredit related factors such as changes in interest rates, market spreads and market conditions subsequent to purchase, not credit deterioration.  As of September 30, 2021 the Company has not recorded an allowance for credit losses on AFS securities.

XML

Loans

9 Months Ended

Sep. 30, 2021

Receivables [Abstract]

Loans

Loans:

Acquired loans were transferred and are included in originated loans at period ended September 30, 2021.  This is to align with the calculation of the allowance for credit losses being used under the CECL model.  Loan balances were as follows:

(In Thousands of Dollars)	September 30, 2021			December 31, 2020
Originated loans:
Commercial real estate
Owner occupied	$	260,556		$	215,187
Non-owner occupied		351,407			309,777
Farmland		176,190			156,277
Other		78,444			78,140
Commercial
Commercial and industrial		302,356			385,831
Agricultural		50,707			44,922
Residential real estate
1-4 family residential		376,901			324,723
Home equity lines of credit		106,750			92,968
Consumer
Indirect		158,617			164,620
Direct		21,520			23,348
Other		9,359			9,868
Total originated loans	$	1,892,807		$	1,805,661
Acquired loans:
Commercial real estate
Owner occupied	$	0		$	45,101
Non-owner occupied		0			52,863
Farmland		0			26,080
Other		0			12,868
Commercial
Commercial and industrial		0			18,662
Agricultural		0			4,850
Residential real estate
1-4 family residential		0			89,118
Home equity lines of credit		0			17,383
Consumer
Direct		0			5,128
Other		0			97
Total acquired loans	$	0		$	272,150
Net Deferred loan (fees) costs		1,409			233
Allowance for credit losses		(23,136	)		(22,144	)
Net loans	$	1,871,080		$	2,055,900

Allowance for credit loss activity

The following tables present the activity in the allowance for credit losses by portfolio segment for the three and nine month periods ended September 30, 2021 and the activity in the allowance for loan losses by portfolio segment for the three and nine month periods ended September 30, 2020:

Three Months Ended September 30, 2021

(In Thousands of Dollars)	Commercial Real Estate			Commercial			Residential Real Estate			Consumer			Total
Allowance for credit losses
Beginning balance	$	12,290		$	4,600		$	4,130		$	3,786		$	24,806
Adjustment related to reserve for unfunded loan reclass	$	(245	)	$	(104	)	$	(73	)	$	(15	)		(437	)
Provision for credit losses		(454	)		(655	)		75			87			(947	)
Loans charged off		(31	)		(126	)		(55	)		(199	)		(411	)
Recoveries		1			15			41			68			125
Total ending allowance balance	$	11,561		$	3,730		$	4,118		$	3,727		$	23,136

Nine Months Ended September 30, 2021

(In Thousands of Dollars)	Commercial Real Estate			Commercial			Residential Real Estate			Consumer			Total
Allowance for credit losses
Beginning balance	$	10,824		$	5,073		$	3,643		$	2,604		$	22,144
Adjustment related to reserve for unfunded loan reclass		(245	)		(104	)		(73	)		(15	)		(437	)
Impact of CECL adoption		(2,076	)		429			237			3,860			2,450
Provision for credit losses		3,077			(1,668	)		411			(2,292	)		(472	)
Loans charged off		(51	)		(198	)		(221	)		(727	)		(1,197	)
Recoveries		32			198			121			297			648
Total ending allowance balance	$	11,561		$	3,730		$	4,118		$	3,727		$	23,136

Three Months Ended September 30, 2020

(In Thousands of Dollars)	Commercial Real Estate			Commercial			Residential Real Estate			Consumer			Total
Allowance for credit losses
Beginning balance	$	7,972		$	3,293		$	2,991		$	2,704		$	16,960
Provision for credit losses		1,052			1,090			414			44			2,600
Loans charged off		(20	)		(92	)		(22	)		(259	)		(393	)
Recoveries		2			1			14			157			174
Total ending allowance balance	$	9,006		$	4,292		$	3,397		$	2,646		$	19,341

Nine Months Ended September 30, 2020

(In Thousands of Dollars)	Commercial Real Estate			Commercial			Residential Real Estate			Consumer			Total
Allowance for credit losses
Beginning balance	$	6,156		$	2,447		$	3,029		$	2,855		$	14,487
Provision for credit losses		2,961			2,176			490			473			6,100
Loans charged off		(117	)		(340	)		(163	)		(1,046	)		(1,666	)
Recoveries		6			9			41			364			420
Total ending allowance balance	$	9,006		$	4,292		$	3,397		$	2,646		$	19,341

The following table presents the recorded investment in nonaccrual and loans past due 90 days or more still on accrual by class of loans as of September 30, 2021 and December 31, 2020:

	September 30, 2021				December 31, 2020
(In Thousands of Dollars)	Nonaccrual		Loans Past Due 90 Days or More Still Accruing		Nonaccrual		Loans Past Due 90 Days or More Still Accruing
Originated loans:
Commercial real estate
Owner occupied	$	452	$	0	$	0	$	335
Non-owner occupied		2,627		0		0		0
Farmland		277		0		0		0
Commercial
Commercial and industrial		5,177		3		3,312		22
Agricultural		34		0		205		0
Residential real estate
1-4 family residential		3,960		466		866		223
Home equity lines of credit		718		137		603		0
Consumer
Indirect		462		101		648		64
Direct		261		69		157		111
Other		0		0		1		5
Total originated loans	$	13,968	$	776	$	5,792	$	760
Acquired loans:
Commercial real estate
Owner occupied	$	0	$	0	$	27	$	0
Non-owner occupied		0		0		362		0
Farmland		0		0		471		95
Commercial
Commercial and industrial		0		0		477		0
Agricultural		0		0		4		0
Residential real estate
1-4 family residential		0		0		4,128		1,469
Home equity lines of credit		0		0		186		0
Consumer
Direct		0		0		58		6
Total acquired loans	$	0	$	0	$	5,713	$	1,570
Total loans	$	13,968	$	776	$	11,505	$	2,330

The following tables present the aging of the recorded investment in past due loans as of September 30, 2021 and December 31, 2020 by class of loans.  Note that loans on a current modification to defer payments under the CARES Act are included in loans not past due.

(In Thousands of Dollars)	30-59 Days Past Due		60-89 Days Past Due		90 Days or More Past Due and Nonaccrual		Total Past Due		Loans Not Past Due		Total
September 30, 2021
Commercial real estate
Owner occupied	$	72	$	0	$	452	$	524	$	259,656	$	260,180
Non-owner occupied		0		0		2,627		2,627		348,267		350,894
Farmland		356		0		277		633		175,297		175,930
Other		0		0		0		0		78,217		78,217
Commercial
Commercial and industrial		112		358		5,180		5,650		294,434		300,084
Agricultural		87		9		34		130		50,756		50,886
Residential real estate
1-4 family residential		3,399		845		4,426		8,670		367,333		376,003
Home equity lines of credit		253		28		855		1,136		105,622		106,758
Consumer
Indirect		874		57		563		1,494		162,812		164,306
Direct		375		78		330		783		20,816		21,599
Other		33		8		0		41		9,318		9,359
Total loans	$	5,561	$	1,383	$	14,744	$	21,688	$	1,872,528	$	1,894,216

(In Thousands of Dollars)	30-59 Days Past Due		60-89 Days Past Due		90 Days or More Past Due and Nonaccrual		Total Past Due		Loans Not Past Due		Total
December 31, 2020
Originated loans:
Commercial real estate
Owner occupied	$	0	$	0	$	335	$	335	$	214,460	$	214,795
Non-owner occupied		0		0		0		0		309,216		309,216
Farmland		0		0		0		0		156,053		156,053
Other		261		0		0		261		77,725		77,986
Commercial
Commercial and industrial		356		61		3,334		3,751		378,594		382,345
Agricultural		45		255		205		505		44,555		45,060
Residential real estate
1-4 family residential		1,668		974		1,089		3,731		320,129		323,860
Home equity lines of credit		419		0		603		1,022		91,957		92,979
Consumer
Indirect		1,046		285		712		2,043		168,245		170,288
Direct		284		120		268		672		22,789		23,461
Other		24		22		6		52		9,816		9,868
Total originated loans	$	4,103	$	1,717	$	6,552	$	12,372	$	1,793,539	$	1,805,911
Acquired loans:
Commercial real estate
Owner occupied	$	0	$	0	$	27	$	27	$	45,072	$	45,099
Non-owner occupied		197		0		362		559		52,295		52,854
Farmland		0		0		566		566		25,513		26,079
Other		0		0		0		0		12,868		12,868
Commercial
Commercial and industrial		19		390		477		886		17,772		18,658
Agricultural		4		0		4		8		4,841		4,849
Residential real estate
1-4 family residential		1,954		821		5,597		8,372		80,745		89,117
Home equity lines of credit		23		0		186		209		17,175		17,384
Consumer
Direct		20		49		64		133		4,995		5,128
Other		0		0		0		0		97		97
Total acquired loans	$	2,217	$	1,260	$	7,283	$	10,760	$	261,373	$	272,133
Total loans	$	6,320	$	2,977	$	13,835	$	23,132	$	2,054,912	$	2,078,044

XML

Troubled Debt Restructurings

9 Months Ended

Sep. 30, 2021

Debt Disclosure [Abstract]

Troubled Debt Restructurings

Troubled Debt Restructurings

Total troubled debt restructurings were $4.0 million and $4.1 million at September 30, 2021, and December 31, 2020.  The Company has allocated $109 thousand and $81 thousand of specific reserves to loans whose terms have been modified in troubled debt restructurings at September 30, 2021, and December 31, 2020, respectively.  There were no commitments to lend additional amounts to borrowers with loans that were classified as troubled debt restructurings at September 30, 2021, and at December 31, 2020.

During the three and nine month periods ended September 30, 2021 and 2020, the terms of certain loans were modified as troubled debt restructurings.  The modification of the terms of such loans included one or a combination of the following: a reduction of the stated interest rate of the loan; an extension of the maturity date at a stated rate of interest lower than the current market rate for new debt with similar risk; a deferral of principal, interest and/or escrow; or a legal concession.  During the three month period ended September 30, 2021, the terms of such loans included a reduction of the stated interest rate of the loan of 0.25% and an extension of the maturity date of 193 months.  During the same three month period in 2020, the terms of such loans included a reduction of the stated interest rate of the loan of 2.25% and an extension of the maturity date of 48 months.  During the nine month period ended September 30, 2021, the terms of such loans included a reduction of the stated interest rate of the loan in the range of 0.25% and 4.075% and extensions of the maturity dates on these and other troubled debt restructurings in the range of 22 days to 361 months.  During the same nine month period in 2020, the terms of such loans included a reduction of the stated interest rate of the loan in the range of 1.00% and 2.25% and an extensions of the maturity dates in the range of 48 to 183 months.

The following table presents loans by class modified as troubled debt restructurings that occurred during the three and nine month periods ended September 30, 2021 and 2020:

			Pre- Modification		Post- Modification
Three Months Ended September 30, 2021	Number of		Outstanding Recorded		Outstanding Recorded
(In Thousands of Dollars)	Loans		Investment		Investment
Residential real estate
1-4 family residential		2	$	215	$	233
Home equity lines of credit		1		103		103
Consumer
Indirect		5		30		30
Direct		1		10		10
Total loans		9	$	358	$	376

			Pre- Modification		Post- Modification
Nine Months Ended September 30, 2021	Number of		Outstanding Recorded		Outstanding Recorded
(In Thousands of Dollars)	Loans		Investment		Investment
Commercial		4	$	22	$	22
Residential real estate
1-4 family residential		6		426		414
Home equity lines of credit		5		201		201
Consumer
Indirect		12		121		121
Direct		3		16		16
Total loans		30	$	786	$	774

			Pre- Modification		Post- Modification
Three Months Ended September 30, 2020	Number of		Outstanding Recorded		Outstanding Recorded
(In Thousands of Dollars)	Loans		Investment		Investment
Originated loans:
Consumer
Indirect		2	$	3	$	3
Total originated loans		2	$	3	$	3
Acquired loans:
Residential real estate
1-4 family residential		1		60		64
Total acquired loans		1	$	60	$	64
Total loans		3	$	63	$	67

			Pre- Modification		Post- Modification
Nine Months Ended September 30, 2020	Number of		Outstanding Recorded		Outstanding Recorded
(In Thousands of Dollars)	Loans		Investment		Investment
Originated loans:
Commercial		1	$	21	$	21
Residential real estate
1-4 family residential		6		245		246
Home equity lines of credit		4		100		102
Consumer
Indirect		19		124		124
Other		1		15		15
Total originated loans		31	$	505	$	508
Acquired loans:
1-4 family residential		3		140		144
Total acquired loans		3	$	140	$	144
Total loans		34	$	645	$	652

There were $15 thousand and $91 thousand in charge offs during the three and nine month periods ended September 30, 2021, respectively. There was $15 thousand and $90 thousand increase to the provision for loan losses during the three and nine month periods ended September 30, 2021, respectively, as a result of outstanding troubled debt restructurings.  There were $33 thousand and $72 thousand in charge offs during the three and nine month periods ended September 30, 2020, respectively. There was a $33 thousand and a $72 thousand increase to the provision during the three and nine month period ended September 30, 2020, respectively, as a result of troubled debt restructurings.

There were two commercial loans, one residential loan, and one indirect loan for which there was a payment default within twelve months following the modification of the troubled debt restructuring during the three month and nine month period ended September 30, 2021.  There was one commercial loan past due at September 30, 2021.  There was no provision recorded as a result of the defaults during 2021.  A loan is considered to be in payment default once it is 30 days contractually past due under the modified terms.

There were two commercial farmland loans and one commercial loan for which there was a payment default within twelve months following the modification of the troubled debt restructuring during the three month and nine month periods ended September 30, 2020.  There was no provision recorded as a result of the defaults during 2020.  A loan is considered to be in payment default once it is 30 days contractually past due under the modified terms.    

The Company offered three month deferrals upon request by the borrowers. For those borrowers in industries that were greatly impacted by COVID-19, additional deferrals were considered and granted beyond the initial three month period. The range of deferred months for subsequent requests were three to twelve months. The decline in deferred loans and balances was due to borrowers not requesting additional deferments and most continued to pay under the original terms of their loan.   

Farmers is also a preferred U.S. Small Business Administration (“SBA”) lender and dedicated significant additional staff and other resources to help our customers complete and submit their applications and supporting documentation for loans offered under the Paycheck Protection Program (“PPP”) under the CARES Act, so they could obtain SBA approval and receive funding as quickly as possible. During the period of the PPP program, the Company facilitated PPP assistance to 1,714 business customers totaling $199.8 million.  The Company, on behalf of its customers, began processing borrower applications for PPP forgiveness at the beginning of September 2020.  The SBA has up to ninety days to review an application for PPP forgiveness and provide a decision at the end of that review.  Once forgiveness of the PPP loan has been communicated and payment is received from the SBA, the Company will record the cash received from the SBA, pay-off the loans based on the amount of forgiveness provided and accelerate the amount of net deferred loan fees/costs recognized for the portion of the PPP loans that are forgiven.  During the period ended September 30, 2021, the Company has received life to date payments from the SBA for forgiveness of loans totaling $198.4 million, or approximately 99.2% of the PPP loans originated in 2020. The Company has processed $84.0 million in new loans for PPP loan funding during 2021. The Company has also received payments from the SBA for forgiveness of loans totaling $29.2 million, or approximately 34.7%, of PPP loans originated in 2021.

XML

Credit Quality Indicators

9 Months Ended

Sep. 30, 2021

Risks And Uncertainties [Abstract]

Credit Quality Indicators

Credit Quality Indicators

The Company categorizes loans into risk categories based on relevant information about the ability of borrowers to service their debt such as: current financial information, historical payment experience, credit documentation, public information, and current economic trends, among other factors.  The Company establishes a risk rating at origination for all commercial loan and commercial real estate relationships.  For relationships over $1 million, management monitors the loans on an ongoing basis for any changes in the borrower’s ability to service their debt.  Management also affirms the risk ratings for the loans in their respective portfolios on an annual basis.  The Company uses the following definitions for risk ratings:

Special Mention. Loans classified as special mention have a potential weakness that deserves management’s close attention.  If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or of the institution’s credit position at some future date.  Special mention assets are not adversely classified and do not expose an institution to sufficient risk to warrant adverse classification.

Substandard. Loans classified as substandard are inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged, if any.  Loans so classified have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt.  Substandard loans are characterized by the distinct possibility that the institution will sustain some loss if the deficiencies are not corrected.

Doubtful. Loans classified as doubtful have all the weaknesses inherent in those classified as substandard, with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions, and values, highly questionable and improbable.

Loans not meeting the criteria above that are analyzed individually as part of the above described process are considered to be pass rated loans.

As of September 30, 2021 and December 31, 2020, and based on the most recent analysis performed, the risk category of loans by class of loans is as follows:

(In Thousands of Dollars)	Pass		Special Mention		Sub standard		Total
September 30, 2021
Commercial real estate
Owner occupied	$	251,517	$	6,470	$	2,193	$	260,180
Non-owner occupied		326,515		14,500		9,879		350,894
Farmland		172,370		2,174		1,386		175,930
Other		77,304		773		140		78,217
Commercial
Commercial and industrial		291,700		536		7,848		300,084
Agricultural		50,268		521		97		50,886
Total loans	$	1,169,674	$	24,974	$	21,543	$	1,216,191

(In Thousands of Dollars)	Pass		Special Mention		Sub standard		Total
December 31, 2020
Originated loans:
Commercial real estate
Owner occupied	$	208,289	$	5,121	$	1,385	$	214,795
Non-owner occupied		290,773		11,240		7,203		309,216
Farmland		153,225		2,464		364		156,053
Other		77,432		387		167		77,986
Commercial
Commercial and industrial		372,083		1,522		8,740		382,345
Agricultural		44,527		320		213		45,060
Total originated loans	$	1,146,329	$	21,054	$	18,072	$	1,185,455
Acquired loans:
Commercial real estate
Owner occupied	$	44,031	$	87	$	981	$	45,099
Non-owner occupied		50,053		49		2,752		52,854
Farmland		24,637		100		1,342		26,079
Other		12,868		0		0		12,868
Commercial
Commercial and industrial		16,246		0		2,412		18,658
Agricultural		4,481		303		65		4,849
Total acquired loans	$	152,316	$	539	$	7,552	$	160,407
Total loans	$	1,298,645	$	21,593	$	25,624	$	1,345,862

The Company considers the performance of the loan portfolio and its impact on the allowance for credit losses.  For residential, consumer indirect and direct loan classes, the Company evaluates credit quality based on the aging status of the loan, which was previously presented, and by payment activity.  In the 1-4 family residential real estate portfolio at September 30, 2021, other real estate owned and foreclosure properties were $0 and $314 thousand, respectively.  At December 31, 2020, other real estate owned and foreclosure properties were $0 and $699 thousand, respectively.

The following tables present the recorded investment in residential, consumer indirect and direct auto loans based on payment activity as of September 30, 2021 and December 31, 2020.  Nonperforming loans are loans past due 90 days or more and still accruing interest and nonaccrual loans.

	Residential Real Estate				Consumer
(In Thousands of Dollars)	1-4 Family Residential		Home Equity Lines of Credit		Indirect		Direct		Other
September 30, 2021
Performing	$	371,577	$	105,903	$	163,743	$	21,269	$	9,359
Nonperforming		4,426		855		563		330		0
Total loans	$	376,003	$	106,758	$	164,306	$	21,599	$	9,359

	Residential Real Estate				Consumer
(In Thousands of Dollars)	1-4 Family Residential		Home Equity Lines of Credit		Indirect		Direct		Other
December 31, 2020
Originated loans:
Performing	$	322,771	$	92,376	$	169,576	$	23,193	$	9,862
Nonperforming		1,089		603		712		268		6
Total originated loans	$	323,860	$	92,979	$	170,288	$	23,461	$	9,868
Acquired loans:
Performing	$	83,520	$	17,198	$	0	$	5,064	$	97
Nonperforming		5,597		186		0		64		0
Total acquired loans		89,117		17,384		0		5,128		97
Total loans	$	412,977	$	110,363	$	170,288	$	28,589	$	9,965

The following table presents total loans by risk categories and year of origination.

	Term Loans Amortized Cost Basis by Origination Year
As of September 30, 2021	2021		2020		2019		2018		2017		Prior		Revolving Loans		Total
Commercial real estate
Risk Rating
Pass	$	79,167	$	103,241	$	128,436	$	93,100	$	65,831	$	169,999	$	15,562	$	655,336
Special mention		773		0		9,518		1,716		2,892		6,365		479		21,743
Substandard		0		327		2,284		502		90		8,888		121		12,212
Total commercial real estate loans	$	79,940	$	103,568	$	140,238	$	95,318	$	68,813	$	185,252	$	16,162	$	689,291
Commercial
Risk Rating
Pass	$	90,549	$	59,498	$	25,933	$	29,075	$	11,732	$	18,807	$	56,106	$	291,700
Special mention		220		106		87		0		0		0		123		536
Substandard		3,119		1,881		334		265		814		84		1,351		7,848
Total commercial loans	$	93,888	$	61,485	$	26,354	$	29,340	$	12,546	$	18,891	$	57,580	$	300,084
Agricultural
Risk Rating
Pass	$	30,585	$	54,038	$	30,248	$	31,198	$	20,075	$	38,288	$	18,206	$	222,638
Special mention		0		238		33		0		2,075		0		349		2,695
Substandard		356		21		66		13		0		997		30		1,483
Total agricultural loans	$	30,941	$	54,297	$	30,347	$	31,211	$	22,150	$	39,285	$	18,585	$	226,816
Residential real estate
Risk Rating
Pass	$	48,989	$	78,879	$	37,697	$	29,361	$	39,854	$	129,640	$	2,685	$	367,105
Special mention		0		0		0		0		0		0		0		0
Substandard		50		0		23		54		588		8,183		0		8,898
Total residential real estate loans	$	49,039	$	78,879	$	37,720	$	29,415	$	40,442	$	137,823	$	2,685	$	376,003
Home equity lines of credit
Risk Rating
Pass	$	146	$	0	$	0	$	0	$	99	$	1,213	$	103,502	$	104,960
Special mention		0		0		0		0		0		0		48		48
Substandard		0		0		20		74		77		1,357		222		1,750
Total home equity lines of credit	$	146	$	0	$	20	$	74	$	176	$	2,570	$	103,772	$	106,758
Consumer
Risk Rating
Pass	$	46,676	$	50,526	$	39,119	$	23,551	$	11,356	$	16,516	$	6,194	$	193,938
Special mention		0		0		0		0		0		0		0		0
Substandard		32		321		173		205		162		433		0		1,326
Total consumer loans	$	46,708	$	50,847	$	39,292	$	23,756	$	11,518	$	16,949	$	6,194	$	195,264

Allowance for Credit Losses

The Company adopted ASU 2016-13 to calculate the allowance for credit losses (“ACL”) which requires projecting credit losses over the lifetime of the credits.  The ACL is adjusted through the provision for credit losses and reduced by net charge offs of loans.  Although the Company has a diversified loan portfolio, the credit risk in the loan portfolio is largely influenced by general economic conditions and trends of the counties and markets in which the debtors operate, and the resulting impact on the operations of borrowers or on the value of any underlying collateral.

The credit loss estimation process involves procedures that consider the unique characteristics of the Company’s loan portfolio segments.  These segments are disaggregated into the loan pools for monitoring.  A model of risk characteristics, such as loss history and delinquency experience, trends in past due and non-performing loans, as well as existing economic conditions and supportable forecasts used to determine credit loss assumptions.

The Company uses two methodologies to analyze loan pools.  The cohort method (“cohort”) and the probability of default/loss given default (“PD/LGD”). Cohort relies on the creation of cohorts to capture loans that qualify for a particular segment, as of a point in time. Those loans are then tracked over their remaining lives to determine their loss experience.  The Company aggregates financial assets on the basis of similar risk characteristics when evaluating loans on a collective basis.  Those characteristics include, but aren’t limited to, internal or external credit score, risk ratings, financial asset, loan type, collateral type, size, effective interest rate, term, or geographical location.  The Company uses cohort primarily for consumer loan portfolios.

The probability of default (“PD”) portion of PD/LGD is defined by the Company as 90 days past due, placed on non-accrual, becomes a troubled debt restructuring or is partially, or wholly, charged-off.  Typically, a one-year time period is used to asses PD.  PD can be measured and applied using various risk criteria.  Risk rating is one common way to apply PDs.  Loss given default (“LGD”) is to determine the percentage of loss by facility or collateral type.  LGD estimates can sometimes be driven, or influenced, by product type, industry or geography.  The Company uses PD/LGD primarily for commercial loan portfolios.

XML

Revenue from Contracts with Customers

9 Months Ended

Sep. 30, 2021

Revenue From Contract With Customer [Abstract]

Revenue from Contracts with Customers

Revenue from Contracts with Customers:

All material revenue from contracts with customers in the scope of ASC 606 is recognized within noninterest income.  The following table presents the Company’s noninterest income by revenue stream and reportable segment, net of eliminations, for the three and nine months ended September 30, 2021 and 2020.

(In Thousands of Dollars)	Trust Segment		Bank Segment		Totals
For Three Months Ended September 30, 2021
Service charges on deposit accounts	$	0	$	924	$	924
Debit card and EFT fees		0		1,128		1,128
Trust fees		2,335		0		2,335
Insurance agency commissions		0		799		799
Retirement plan consulting fees		334		0		334
Investment commissions		0		638		638
Other (outside the scope of ASC 606)		0		2,857		2,857
Total noninterest income	$	2,669	$	6,346	$	9,015

(In Thousands of Dollars)	Trust Segment		Bank Segment		Totals
For Three Months Ended September 30, 2020
Service charges on deposit accounts	$	0	$	904	$	904
Debit card and EFT fees		0		1,048		1,048
Trust fees		1,973		0		1,973
Insurance agency commissions		0		784		784
Retirement plan consulting fees		341		0		341
Investment commissions		0		353		353
Other (outside the scope of ASC 606)		0		3,814		3,814
Total noninterest income	$	2,314	$	6,903	$	9,217

(In Thousands of Dollars)	Trust Segment		Bank Segment		Totals
For Nine Months Ended September 30, 2021
Service charges on deposit accounts	$	0	$	2,522	$	2,522
Debit card and EFT fees		0		3,438		3,438
Trust fees		6,929		0		6,929
Insurance agency commissions		0		2,748		2,748
Retirement plan consulting fees		1,043		0		1,043
Investment commissions		0		1,665		1,665
Other (outside the scope of ASC 606)		0		10,361		10,361
Total noninterest income	$	7,972	$	20,734	$	28,706

(In Thousands of Dollars)	Trust Segment		Bank Segment		Totals
For Nine Months Ended September 30, 2020
Service charges on deposit accounts	$	0	$	2,752	$	2,752
Debit card and EFT fees		0		2,866		2,866
Trust fees		5,682		0		5,682
Insurance agency commissions		0		2,348		2,348
Retirement plan consulting fees		1,129		0		1,129
Investment commissions		0		1,080		1,080
Other (outside the scope of ASC 606)		0		9,805		9,805
Total noninterest income	$	6,811	$	18,851	$	25,662

A description of the Company’s revenue streams under ASC 606 follows:

Service charges on deposit accounts – The Company earns fees from its deposit customers for transaction-based, account maintenance, and overdraft services. Management reviewed the deposit account agreements, and determined that the agreements can be terminated at any time by either the Bank or the account holder.  Transaction fees, such as balance transfers, wires and overdraft charges are settled the day the performance obligation is satisfied.  The Bank’s monthly service charges and maintenance fees are for services provided to the customer on a monthly basis and are considered a series of services that have the same pattern of transfer each month.  The review of service charges assessed on deposit accounts included the amount of variable consideration that is a part of the monthly charges.  It was found that the waiver of service charges due to insufficient funds and dormant account fees is immaterial and would not require a change in the accounting treatment for these fees under the new revenue standards.

Debit Card Interchange Fees – Customers and the Bank have an account agreement and maintain deposit balances with the Bank.  Customers use a bank issued debit card to purchase goods and services, and the Bank earns interchange fees on those transactions, typically a percentage of the sale amount of the transaction.  The Bank records the amount due when it receives the settlement from the payment network.  Payments from the payment network are received and recorded into income on a daily basis.  There are no contingent debit card interchange fees recorded by the Company that could be subject to a clawback in future periods.

Trust fees – Services provided to Trust customers are a series of distinct services that have the same pattern of transfer each month.  Fees for trust accounts are billed and drafted from trust accounts monthly.  The Company records these fees on the income statement on a monthly basis.  Fees are assessed based on the total investable assets of the customer’s trust account.  A signed contract between the Company and the customer is maintained for all customer trust accounts with payment terms identified.  It is probable that the fees will be collectible as funds being managed are accessible by the asset manager.  Past history of trust fee income recorded by the Company indicates that it is highly unlikely that a significant reversal could occur.  There are no contingent incentive fees recorded by the Company that could be subject to a clawback in future periods.

Insurance Agency Commissions – Insurance agency commissions are received from insurance carriers for the agency’s share of commissions from customer premium payments.  These commissions are recorded into income when checks are received from the insurance carriers, and there is no contingent portion associated with these commission checks.  There may be a short time-lag in recording revenue when cash is received instead of recording the revenue when the policy is signed by the customer, but the time lag is insignificant and does not impact the revenue recognition process.

Insurance also receives incentive checks from the insurance carriers for achieving specified levels of production with particular carriers.  These amounts are recorded into income when a check is received, and there are no contingent amounts associated with these payments that may be clawed back by the carrier in the future.  Similar to the monthly commissions explained in the preceding paragraph, there may be a short time-lag in recording incentive revenue on a cash basis as opposed to estimating the amount of incentive revenue expected to be earned, this does not materially impact the recognition of Insurance revenue.  If there were any amounts that would need to be refunded for one specific Insurance customer, management believes the reversal would not be significant.

Other potential situations surrounding the recognition of Insurance revenue include the estimating potential refunds due to the likely cancellation of a percentage of customers cancelling their policies and recording revenue at the time of policy renewals.  Management concluded that since Insurance agency commissions represent only 2.4% of the Company’s total revenue, adjusting the current practice of recording insurance revenue for these situations would not have a material impact on the reporting of total revenue.  

Retirement Plan Consulting Fees – Revenue is recognized based on the level of work performed for the client.  Any payments that are received for work to be performed in the future are recorded in a deferred revenue account, and recorded into income when the fees are earned.  Retirement plan consulting fees represent only 0.9% of the Company’s total revenue, and therefore management has concluded that any adjustment of revenue for one particular customer for a refund or any other reason would be insignificant and would not materially impact the Company’s total revenue.  

Investment Commissions – Investment commissions are earned through the sales of non-deposit investment products to customers of the Company.  The sales are conducted through a third-party broker-dealer.  When the commissions are received and recorded into income on the Bank’s income statement, there is no contingent portion that may need to be refunded back to the third party broker dealer.  Investment commissions represent only 1.5% of the Company’s total revenue, and therefore management has concluded that any adjustment of revenue for a particular customer for a refund or any other reason would be insignificant and would not materially impact the Company’s total revenue.  

Other – Income items included in “Other” are Bank owned life insurance income, security gains, net gains on the sale of loans and other operating income.  Any amounts within the scope of ASC 606 are deemed immaterial.

XML

Fair Value

9 Months Ended

Sep. 30, 2021

Fair Value Disclosures [Abstract]

Fair Value

Fair Value:

Fair value is the exchange price that would be received for an asset, or paid to transfer a liability (exit price), in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date.  There are three levels of inputs that may be used to measure fair values:

Level 1 – Quoted prices (unadjusted) for identical assets or liabilities in active markets that the entity has the ability to access as of the measurement date.

Level 2 – Significant other observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data.

Level 3 – Significant unobservable inputs that reflect a reporting entity’s own assumptions about the assumptions that market participants would use in pricing an asset or liability.

The Company used the following methods and significant assumptions to estimate the fair value of each type of financial instrument:

Investment Securities: The Company uses a third party service to estimate fair value on available for sale securities on a monthly basis.  The Company’s service provider is considered a leading evaluation pricing service for U.S. domestic fixed income securities and values securities using exit pricing requirements.  They subscribe to multiple third-party pricing vendors, and supplement that information with matrix pricing methods.  The fair values for investment securities, which consist of equity securities that are recorded at fair market value to comply with exit pricing, are determined by quoted market prices in active markets, if available (Level 1).  The equity securities change in fair market value is recorded in the income statements.  For securities where quoted prices are not available, fair values are calculated based on quoted prices for similar assets in active markets, quoted prices for similar assets in markets that are not active or inputs other than quoted prices, which provide a reasonable basis for fair value determination.  Such inputs may include interest rates and yield curves, volatilities, prepayment speeds, credit risks and default rates.  Inputs used are derived principally from observable market data (Level 2).  For securities where quoted prices or market prices of similar securities are not available, fair values are calculated using discounted cash flows or other market indicators (Level 3).  The fair values of Level 3 investment securities are determined by using unobservable inputs to measure fair value of assets for which there is little, if any market activity at the measurement date, using reasonable inputs and assumptions based on the best information at the time, to the

extent that inputs are available without undue cost and effort.  For the period ended September 30, 2021 and for the year ended December 31, 2020, the fair value of Level 3 investment securities was immaterial.

Derivative Instruments: The fair values of derivative instruments are based on valuation models using observable market data as of the measurement date (Level 2).

Collateral Dependent Loans: Fair value estimates of collateral dependent loans that are individually reviewed are based on the fair value of the collateral, less estimated costs to sell.  Non-collateral dependent loans are valued based on discounted cash flows.  Loans carried at fair value generally receive specific allocations of the allowance for credit losses in 2021 and allowance for loan losses in prior periods.  For collateral dependent loans, fair value is commonly based on recent real estate appraisals.  These appraisals may utilize a single valuation approach or a combination of approaches including comparable sales and the income approach.  Adjustments are routinely made in the appraisal process by the appraisers to adjust for differences between the comparable sales and income data available.  Such adjustments are usually significant and typically result in a Level 3 classification of the inputs for determining fair value.  Non-real estate collateral may be valued using an appraisal, net book value per the borrower’s financial statements, or aging reports, adjusted or discounted based on management’s historical knowledge, changes in market conditions from the time of the valuation, and management’s expertise and knowledge of the client and client’s business, resulting in a Level 3 fair value classification.  These loans are evaluated on a quarterly basis and adjusted accordingly.

Other Real Estate Owned: Assets acquired through or instead of loan foreclosure are initially recorded at fair value less costs to sell when acquired, establishing a new cost basis.  These assets are subsequently accounted for at lower of cost or fair value less estimated costs to sell. Fair values are commonly based on recent real estate appraisals.  These appraisals may use a single valuation approach or a combination of approaches including comparable sales and the income approach.  Adjustments are routinely made in the appraisal process by the independent appraisers to adjust for differences between the comparable sales and income data available.  Such adjustments are usually significant and typically result in a Level 3 classification of the inputs for determining fair value.

Appraisals for both collateral-dependent impaired loans and other real estate owned are performed by certified general appraisers (for commercial and commercial real estate properties) or certified residential appraisers (for residential properties) whose qualifications and licenses have been reviewed and verified by the Company.  Once received, a member of the Appraisal Department reviews the assumptions and approaches utilized in the appraisal as well as the overall resulting fair value in comparison with independent data sources such as recent market data or industry-wide statistics.  On an annual basis, the Company compares the actual selling price of collateral that has been sold to the most recent appraised value to determine what adjustments should be made to appraisals to arrive at fair value.

Assets measured at fair value on a recurring basis are summarized below:

	Fair Value Measurements at September 30, 2021 Using:
(In Thousands of Dollars)	Carrying Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Financial Assets
Investment securities available-for sale
U.S. Treasury and U.S. government sponsored entities	$	88,470	$	0	$	88,470	$	0
State and political subdivisions		507,283		0		507,283		0
Corporate bonds		3,667		0		3,667		0
Mortgage-backed securities-residential		566,104		0		566,101		3
Collateralized mortgage obligations		13,241		0		13,241		0
Small Business Administration		4,596		0		4,596		0
Equity securities
Equity securities at fair value		493		493		0		0
Other investments measured at net asset value		6,024	n/a		n/a		n/a
Total investment securities	$	1,189,878	$	493	$	1,183,358	$	3
Interest rate swaps	$	2,768	$	0	$	2,768	$	0
Financial Liabilities
Interest rate swaps	$	2,768	$	0	$	2,768	$	0

	Fair Value Measurements at December 31, 2020 Using:
(In Thousands of Dollars)	Carrying Value		Quoted Prices  in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Financial Assets
Investment securities available-for sale
U.S. Treasury and U.S. government sponsored entities	$	11,845	$	0	$	11,845	$	0
State and political subdivisions		366,306		0		366,306		0
Corporate bonds		3,712		0		3,712		0
Mortgage-backed securities-residential		161,782		0		161,778		4
Collateralized mortgage obligations		26,393		0		26,393		0
Small Business Administration		5,562		0		5,562		0
Equity securities
Equity securities at fair value		538		538		0		0
Other investments measured at net asset value		6,343	n/a		n/a		n/a
Total investment securities	$	582,481	$	538	$	575,596	$	4
Interest rate swaps	$	4,221	$	0	$	4,221	$	0
Financial Liabilities
Interest rate swaps	$	4,221	$	0	$	4,221	$	0

There were no significant transfers between Level 1 and Level 2 during the three and nine month periods ended September 30, 2021 and 2020.

The table below presents a reconciliation of all assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3):

	Investment Securities Available-for-sale (Level 3)
	Three Months ended September 30,				Nine Months ended September 30,
(In Thousands of Dollars)	2021		2020		2021			2020
Beginning Balance	$	3	$	4	$	4		$	5
Transfers from level 2		0		0		0			0
Repayments, calls and maturities		0		0		(1	)		(1	)
Ending Balance	$	3	$	4	$	3		$	4

Assets measured at fair value on a non-recurring basis are summarized below:

	Fair Value Measurements at September 30, 2021 Using:
(In Thousands of Dollars)	Carrying Value		Quoted Prices  in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Financial Assets
Commercial
Commercial and industrial	$	2,954	$	0	$	0	$	2,954
1–4 family residential		82		0		0		82

	Fair Value Measurements at December 31, 2020 Using:
(In Thousands of Dollars)	Carrying Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Financial Assets
Impaired loans
Commercial	$	1,770	$	0	$	0	$	1,770
1–4 family residential		82		0		0		82
Consumer		36		0		0		36

Collateral dependent loans were individually evaluated under ASC 326 for the period ended September 30, 2021, while impaired loans from the period ended December 31, 2020 were individually evaluated under ASC 310.  Collateral dependent loans had a principal balance of $3.5 million with a valuation allowance of $435 thousand at September 30, 2021.  Impaired loans that were measured for impairment using the fair value of the collateral had a principal balance of $2.3 million, with a valuation allowance of $368 thousand at December 31, 2020.  Excluded from the above tables at September 30, 2021 and December 31, 2020, are $724 thousand and $513 thousand of loans classified as troubled debt restructurings and measured using the present value of cash flows, which is not considered an exit price.

Collateral dependent commercial real estate loans, both owner-occupied and non-owner occupied are valued by independent external appraisals.  These external appraisals are prepared using the sales comparison approach and income approach valuation techniques.  Management makes subsequent unobservable adjustments to the collateral dependent loan appraisals.  Collateral dependent loans other than commercial real estate and other real estate owned are not considered material.

The following table presents quantitative information about Level 3 fair value measurements for financial instruments measured at fair value on a non-recurring basis at the periods ended September 30, 2021 and December 31, 2020:

September 30, 2021	Fair value		Valuation Technique(s)	Unobservable Input(s)	Range (Weighted Average)
Individually evaluated loans
Commercial	$	2,954	Sales Comparison	Adjustment for differences between comparable sales	(14.66%) - 8.99% (0%)
Residential		82	Sales comparison	Adjustment for differences between comparable sales	(3.84%) - 3.22% (0.12%)

December 31, 2020	Fair value		Valuation Technique(s)	Unobservable Input(s)	Range (Weighted Average)
Impaired loans
Commercial	$	1,770	Sales comparison	Adjustment for differences between comparable sales	(24.01%) - 17.93% (0.48%)
Residential		82	Sales comparison	Adjustment for differences between comparable sales	(40.00%) - 47.15% (17.77%)
Consumer		36	Sales comparison	Adjustment for differences between comparable sales	(23.60%) - 23.60% (0.00%)

The carrying amounts and estimated fair values of financial instruments not previously disclosed at September 30, 2021 and December 31, 2020 are as follows:

			Fair Value Measurements at September 30, 2021 Using:
(In Thousands of Dollars)	Carrying Amount		Level 1		Level 2		Level 3		Total
Financial assets
Cash and cash equivalents	$	79,808	$	26,933	$	52,875	$	0	$	79,808
Restricted stock		12,524	n/a		n/a		n/a		n/a
Loans held for sale		2,628		0		2,707		0		2,707
Loans, net		1,871,080		0		0		1,857,184		1,857,184
Accrued interest receivable		9,930		0		5,126		4,804		9,930
Financial liabilities
Deposits		2,866,413		2,514,758		350,919		0		2,865,677
Long-term borrowings		49,649		0		49,267		0		49,267
Accrued interest payable		389		26		363		0		389

			Fair Value Measurements at December 31, 2020 Using:
(In Thousands of Dollars)	Carrying Amount		Level 1		Level 2		Level 3		Total
Financial assets
Cash and cash equivalents	$	254,621	$	20,503	$	234,118	$	0	$	254,621
Restricted stock		14,647	n/a		n/a		n/a		n/a
Loans held for sale		4,766		0		4,909		0		4,909
Loans, net		2,055,900		0		0		2,036,872		2,036,872
Accrued interest receivable		9,880		0		3,297		6,583		9,880
Financial liabilities
Deposits		2,610,878		2,097,732		487,105		0		2,584,837
Short-term borrowings		2,521		0		2,521		0		2,521
Long-term borrowings		76,385		0		77,189		0		77,189
Accrued interest payable		690		36		654		0		690

The methods and assumptions used to estimate fair value, not previously described, are described as follows:

Cash and Cash Equivalents: The carrying amounts of cash and short-term instruments approximate fair values and are classified as Level 1.

Restricted Stock: It is not practical to determine the fair value of restricted stock due to restrictions placed on its transferability.

Loans: Fair values of loans, excluding loans held for sale, are estimated as follows: The Company uses a third party firm that uses cash flow analysis and current market interest rates along with adjustments for credit, liquidity and option risk to conform to the ASU 2016-01 exit price requirement.  Loans in the tables above consist of impaired credits held for investment.  Fair value for collateral dependent loans is based upon appraised values adjusted for trends observed in the market, less estimated cost to sell. The cash flow method is used for estimating fair value for noncollateral dependent loans. A valuation allowance was recorded for the excess of the loan’s recorded investment over the amounts determined by the collateral value method. This valuation is a component of the allowance for credit losses. The Company considers these fair values Level 3.

Loans held for sale: The fair value of loans held for sale is estimated based upon binding contracts and quotes from third party investors resulting in a Level 2 classification.

Deposits: The fair values disclosed for demand deposits – interest and non-interest checking, passbook savings, and money market accounts – are, by definition, equal to the amount payable on demand at the reporting date resulting in a Level 1 classification.  The carrying amounts of variable rate certificates of deposit approximate their fair values at the reporting date resulting in a Level 2 classification.  Fair value for fixed rate certificates of deposit are estimated using a discounted cash flows calculation that applies interest rates currently being offered on certificates to a schedule of aggregated expected monthly maturities on time deposits resulting in a Level 2 classification.

Short-term Borrowings: The carrying amounts of federal funds purchased, borrowings under repurchase agreements, and other short-term borrowings, generally maturing within ninety days, approximate their fair values resulting in a Level 2 classification.

Long-term Borrowings: The fair values of the Company’s long-term borrowings are estimated using discounted cash flow analyses based on the current borrowing rates for similar types of borrowing arrangements resulting in a Level 2 classification.

Off-balance Sheet Instruments: The fair value of commitments is not considered material.

XML

Goodwill and Intangible Assets

9 Months Ended

Sep. 30, 2021

Goodwill And Intangible Assets Disclosure [Abstract]

Goodwill and Intangible Assets

Goodwill and Intangible Assets:

Goodwill associated with the Company’s purchase of Maple Leaf in January 2020 and other past acquisitions totaled $45.8 million at September 30, 2021 and December 31, 2020.  Impairment exists when a reporting unit’s carrying value of goodwill exceeds its fair value, which is determined through a two-step impairment test. Management performs goodwill impairment testing on an annual basis as of September 30.  The fair value of the reporting units is determined using a combination of a discounted cash flow method and a guideline public company method.  

Acquired Intangible Assets

Acquired intangible assets were as follows:

	September 30, 2021					December 31, 2020
(In Thousands of Dollars)	Gross Carrying Amount		Accumulated Amortization			Gross Carrying Amount		Accumulated Amortization
Amortized intangible assets:
Customer relationship intangibles	$	7,210	$	(6,557	)	$	7,210	$	(6,318	)
Non-compete contracts		430		(391	)		430		(388	)
Trade name		520		(350	)		520		(320	)
Core deposit intangible		6,979		(4,946	)		6,979		(4,271	)
Total	$	15,139	$	(12,244	)	$	15,139	$	(11,297	)

Aggregate amortization expense was $316 thousand and $948 thousand for the three and nine month periods ended September 30, 2021.  Amortization expense was $332 thousand and $995 thousand for the three and nine months ended September 30, 2020.

Estimated amortization expense for each of the next five periods and thereafter:

2021 (3 months)	$	318
2022		1,090
2023		617
2024		314
2025		253
Thereafter		303
Total	$	2,895

XML

Leases

9 Months Ended

Sep. 30, 2021

Leases [Abstract]

Leases

Leases:

The Company has operating leases for branch office locations, vehicles and certain office equipment such as printers, copiers and faxes. The leases have remaining lease terms of 7 months to 8.3 years, some of which include options to extend the lease for up to 10 years and some of which include options to terminate the leases within 2 months.

The right of use asset and lease liability were $4.5 million and $4.7 million as of September 30, 2021 and $4.8 million and $5.0 million at December 31, 2020.

Lease payments made for the three and nine month period ended September 30, 2021, were $206 thousand and $610 thousand, while lease payments made for the three and nine month period ended September 30, 2020, were $191 thousand and $581 thousand, respectively. Interest expense and amortization expense on finance leases for the three month period ended September 30, 2021, was $44 thousand and $124 thousand, and $116 thousand and $366 thousand for the nine month period ended September 30, 2021.  Interest expense and amortization expense on finance leases for the three month period ended September 30, 2020, was $38 thousand

and $121 thousand, and $95 thousand and $334 thousand for the nine month period ended September 30, 2020.  The weighted-average remaining lease term for all leases was 4.2 years as of September 30, 2021 and the weighted-average discount rate was 2.4%.

Maturities of lease liabilities are as follows as of September 30, 2021:

2021 (3 months)	$	201
2022		647
2023		592
2024		417
2025		424
Thereafter		3,240
Total Payments		5,521
Less: Imputed Interest		(834	)
Total	$	4,687

XML

Interest-Rate Swaps

9 Months Ended

Sep. 30, 2021

Derivative Instruments And Hedging Activities Disclosure [Abstract]

Interest-Rate Swaps

Interest-Rate Swaps:

The Company uses a program that utilizes interest-rate swaps as part of its asset/liability management strategy.  The interest-rate swaps are used to help manage the Company’s interest rate risk position and not as derivatives for trading purposes.  The notional amount of the interest-rate swaps does not represent amounts exchanged by the parties.  The amount exchanged is determined by reference to the notional amount and the other terms of the individual interest-rate swap agreements.

The objective of the interest-rate swaps is to protect the related fixed rate commercial real estate loans from changes in fair value due to changes in interest rates.  The Company has a program whereby it lends to its borrowers at a fixed rate with the loan agreement containing a two-way yield maintenance provision, which will be invoked in the event of prepayment of the loan, and is expected to exactly offset the fair value of unwinding the swap.  The yield maintenance provision represents an embedded derivative which is bifurcated from the host loan contract and, as such, the swaps and embedded derivatives are not designated as hedges.  Accordingly, both instruments are carried at fair value and changes in fair value are reported in current period earnings.

Summary information about these interest-rate swaps at periods ended September 30, 2021 and December 31, 2020 is as follows:

	September 30, 2021			December 31, 2020
Notional amounts (In thousands)	$	48,985		$	41,315
Weighted average pay rate on interest-rate swaps		4.63	%		4.63	%
Weighted average receive rate on interest-rate swaps		2.27	%		2.36	%
Weighted average maturity (years)		3.9			4.3
Fair value of interest-rate swaps (In thousands)	$	(2,768	)	$	(4,221	)
Fair value of loan yield maintenance provisions (In thousands)	$	2,768		$	4,221

The fair value of the yield maintenance provisions and interest-rate swaps is recorded in other assets and other liabilities, respectively, in the consolidated balance sheets.  Changes in the fair value of the yield maintenance provisions and interest-rate swaps are reported in earnings, as other noninterest income in the consolidated statements of income.  For the three month and nine month periods ended September 30, 2021 and 2020 there were no net gains or losses recognized in earnings.

XML

Earnings Per Share

9 Months Ended

Sep. 30, 2021

Earnings Per Share [Abstract]

Earnings Per Share

Earnings Per Share:

The computation of basic and diluted earnings per share is shown in the following table:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2021		2020		2021		2020
Basic EPS
Net income (In thousands)	$	16,011	$	10,869	$	46,142	$	30,519
Weighted average shares outstanding		28,246,206		28,182,744		28,235,732		28,293,445
Basic earnings per share	$	0.57	$	0.39	$	1.63	$	1.08
Diluted EPS
Net income (In thousands)	$	16,011	$	10,869	$	46,142	$	30,519
Weighted average shares outstanding for basic earnings per share		28,246,206		28,182,744		28,235,732		28,293,445
Dilutive effect of restricted stock awards		114,355		107,778		102,813		127,779
Weighted average shares for diluted earnings per share		28,360,561		28,290,522		28,338,545		28,421,224
Diluted earnings per share	$	0.56	$	0.38	$	1.63	$	1.07

There were 17,495 and 94,247 restricted stock awards that were considered anti-dilutive for the three and nine month periods ended September 30, 2021, respectively.  There were no restricted stock awards that were considered anti-dilutive for the three and nine month periods ended September 30, 2020.

XML

Stock Based Compensation

9 Months Ended

Sep. 30, 2021

Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]

Stock Based Compensation

Stock Based Compensation:

During 2017, the Company, with the approval of shareholders, created the 2017 Equity Incentive Plan (the “2017 Plan”).  The 2017 Plan permits the award of up to 800 thousand shares to the Company’s directors and employees to attract and retain exceptional personnel, motivate performance and most importantly to help align the interests of the Company’s executives with those of the Company’s shareholders.  There were 38,061 service time based share awards and 58,245 performance based share awards granted under the 2017 Plan during the nine month period ended September 30, 2021, as shown in the table below.  The actual number of performance based shares issued will depend on the relative performance of the Company’s average return on equity compared to a group of peer companies over a three year vesting period, ending December 31, 2023.  As of September 30, 2021, 300,009 shares are still available to be awarded from the 2017 Plan.    

The restricted stock awards were granted with a fair value price equal to the market price of the Company’s common stock at the date of the grant.  Expense recognized was $278 thousand and $865 thousand for the three and nine month periods ended September 30, 2021, respectively.  During the prior periods, the expense recognized was $364 thousand and $1.1 million for the three and nine month periods ended September 30, 2020, respectively.  As of September 30, 2021, there was $1.7 million of total unrecognized compensation expense related to the nonvested shares granted under the Plans.  The remaining cost is expected to be recognized over 2.6 years.  

The following is the activity under the Plans during the nine month period ended September 30, 2021.

	Nine Months Ended September 30, 2021
	Maximum Awarded Service Units			Weighted Average Grant Date Fair Value		Maximum Awarded Performance Units			Weighted Average Grant Date Fair Value
Beginning balance - non-vested shares		67,765		$	14.32		153,070		$	14.46
Granted		38,061			15.45		58,245			14.21
Vested		(26,621	)		14.41		(52,327	)		14.34
Forfeited		(4,758	)		14.15		0			0
Ending balance - non-vested shares		74,447		$	14.94		158,988		$	14.40

The 78,948 shares that vested during the nine month period ended September 30, 2021 had a weighted average fair value of $14.36 per share.

XML

Other Comprehensive Income (Loss)

9 Months Ended

Sep. 30, 2021

Comprehensive Income Net Of Tax [Abstract]

Other Comprehensive Income (Loss)

Other Comprehensive Income (Loss):

The following table represents the details of other comprehensive income for the three and nine month periods ended September 30, 2021 and 2020.

	Three Months Ended September 30, 2021
(In Thousands of Dollars)	Pre-tax			Tax			After-Tax
Unrealized holding gains (loss) on available-for-sale securities during the period	$	(2,754	)	$	578		$	(2,176	)
Reclassification adjustment for (gains) included in net income (1)		(464	)		96			(368	)
Net other comprehensive income	$	(3,218	)	$	674		$	(2,544	)
	Three Months Ended September 30, 2020
(In Thousands of Dollars)	Pre-tax			Tax			After-Tax
Unrealized holding gains on available-for-sale securities during the period	$	700		$	(147	)	$	553
Reclassification adjustment for (gains) included in net income (1)		(48	)		9			(39	)
Net other comprehensive income	$	652		$	(138	)	$	514
	Nine Months Ended September 30, 2021
(In Thousands of Dollars)	Pre-tax			Tax			After-Tax
Unrealized holding gains (loss) on available-for-sale securities during the period	$	(8,990	)	$	1,888		$	(7,102	)
Reclassification adjustment for (gains) included in net income (1)		(848	)		178			(670	)
Net other comprehensive income	$	(9,838	)	$	2,066		$	(7,772	)
	Nine Months Ended September 30, 2020
(In Thousands of Dollars)	Pre-tax			Tax			After-Tax
Unrealized holding gains on available-for-sale securities during the period	$	13,894		$	(2,918	)	$	10,976
Reclassification adjustment for (gains) losses included in net income (1)		(318	)		66			(252	)
Net other comprehensive income	$	13,576		$	(2,852	)	$	10,724

(1) Pre-tax reclassification adjustments relating to available-for-sale securities are reported in security gains and the tax impact is included in income tax expense on the consolidated statements of income.

XML

Regulatory Capital Matters

9 Months Ended

Sep. 30, 2021

Regulatory Capital Requirements [Abstract]

Regulatory Capital Matters

Regulatory Capital Matters:

Banks and bank holding companies are subject to various regulatory capital requirements administered by the federal banking agencies.  Capital adequacy guidelines and, additionally for banks, prompt corrective action regulations, involve quantitative measures of assets, liabilities, and certain off-balance sheet items calculated under regulatory accounting practices.  Capital amounts and classifications are also subject to qualitative judgments by regulators.  Failure to meet capital requirements can initiate regulatory action by regulators that, if undertaken, could have a direct material effect on the financial statements.  Management believes that as of September 30, 2021, the Company and the Bank meet all capital adequacy requirements to which they are subject.

The FDIC and other federal banking regulators revised the risk-based capital requirements applicable to financial holding companies and insured depository institutions, including the Company and the Bank, to make them consistent with agreements that were reached by the Basel Committee on Banking Supervision (“Basel III”).

The common equity tier 1 capital, tier 1 capital and total capital ratios are calculated by dividing the respective capital amounts by risk-weighted assets.  The leverage ratio is calculated by dividing tier 1 capital by adjusted average total assets.

Basel III limits capital distributions and certain discretionary bonus payments if the banking organization does not hold a “capital conservation buffer” consisting of 2.5% of common equity tier 1 capital, tier 1 capital and total capital to risk-weighted assets in addition to the amount necessary to meet minimum risk-based capital requirements.  Excluding the additional buffer, Basel III requires the Company and the Bank to maintain (i) a minimum ratio of common equity tier 1 capital to risk-weighted assets of at least 4.5%, (ii) a minimum ratio of tier 1 capital to risk-weighted assets of at least 6.0%, (iii) a minimum ratio of total capital to risk-weighted assets of at least 8.0% and (iv) a minimum leverage ratio of at least 4.0%.

Prompt corrective action regulations provide five classifications: well capitalized, adequately capitalized, undercapitalized, significantly undercapitalized, and critically undercapitalized, although these terms are not used to represent overall financial condition.  If only adequately capitalized, regulatory approval is required to accept brokered deposits.  If undercapitalized, capital distributions are limited, as is asset growth and expansion, and capital restoration plans are required.  At September 30, 2021 and December 31, 2020, the most recent regulatory notifications categorized the Bank as well capitalized under the regulatory framework for prompt corrective action.  There are no conditions or events since that notification that management believes have changed the institution’s category.

Actual and required capital amounts and ratios, which do not include the capital conservation buffer, are presented below at September 30, 2021 and December 31, 2020:

	Actual					Requirement For Capital Adequacy Purposes:					To be Well Capitalized Under Prompt Corrective Action Provisions:
	Amount		Ratio			Amount		Ratio			Amount		Ratio
September 30, 2021
Common equity tier 1 capital ratio
Consolidated	$	315,850		14.55	%	$	97,715		4.5	%	N/A		N/A
Bank		265,224		12.23	%		97,606		4.5	%		140,986		6.5	%
Total risk based capital ratio
Consolidated		351,987		16.21	%		173,715		8.0	%	N/A		N/A
Bank		288,360		13.29	%		173,521		8.0	%		216,901		10.0	%
Tier 1 risk based capital ratio
Consolidated		328,850		15.14	%		130,286		6.0	%	N/A		N/A
Bank		265,224		12.23	%		130,141		6.0	%		173,521		8.0	%
Tier 1 leverage ratio
Consolidated		328,850		10.17	%		129,307		4.0	%	N/A		N/A
Bank		265,224		8.25	%		128,647		4.0	%		160,809		5.0	%
December 31, 2020
Common equity tier 1 capital ratio
Consolidated	$	279,864		13.22	%	$	95,211		4.5	%	N/A		N/A
Bank		268,041		12.71	%		94,903		4.5	%	$	137,083		6.5	%
Total risk based capital ratio
Consolidated		311,413		14.72	%		169,264		8.0	%	N/A		N/A
Bank		290,185		13.76	%		168,717		8.0	%		210,897		10.0	%
Tier 1 risk based capital ratio
Consolidated		289,269		13.67	%		126,948		6.0	%	N/A		N/A
Bank		268,041		12.71	%		126,538		6.0	%		168,717		8.0	%
Tier 1 leverage ratio
Consolidated		289,269		9.77	%		118,464		4.0	%	N/A		N/A
Bank		268,041		9.10	%		117,877		4.0	%		147,346		5.0	%

XML

Segment Information

9 Months Ended

Sep. 30, 2021

Segment Reporting [Abstract]

Segment Information

Segment Information:

The reportable segments are determined by the products and services offered, primarily distinguished between banking and trust.  The trust and retirement consulting segments were combined in 2019.   These segments are also distinguished by the level of information provided to the chief operating decision makers in the Company, who use such information to review performance of various components of the business, which are then aggregated.  Loans, investments, and deposits provide the revenues in the banking operation.  All operations are domestic.  Significant segment totals are reconciled to the financial statements as follows:

(In Thousands of Dollars)	Trust Segment		Bank Segment		Eliminations and Others			Consolidated Totals
September 30, 2021
Goodwill and other intangibles	$	5,872	$	46,356	$	(3,558	)	$	48,670
Total assets	$	14,732	$	3,298,987	$	3,328		$	3,317,047

(In Thousands of Dollars)	Trust Segment		Bank Segment		Eliminations and Others			Consolidated Totals
December 31, 2020
Goodwill and other intangibles	$	6,046	$	47,129	$	(3,558	)	$	49,617
Total assets	$	15,147	$	3,055,628	$	373		$	3,071,148

(In Thousands of Dollars)	Trust Segment		Bank Segment			Eliminations and Others			Consolidated Totals
For Three Months Ended September 30, 2021
Net interest income	$	31	$	26,798		$	(295	)	$	26,534
Provision for credit losses and unfunded loans		0		(948	)		0			(948	)
Service fees, security gains and other noninterest income		2,707		6,385			(77	)		9,015
Noninterest expense		1,726		14,586			(12	)		16,300
Amortization and depreciation expense		67		653			108			828
Income before taxes		945		18,892			(468	)		19,369
Income taxes		198		3,310			(150	)		3,358
Net income	$	747	$	15,582		$	(318	)	$	16,011

(In Thousands of Dollars)	Trust Segment		Bank Segment			Eliminations and Others			Consolidated Totals
For Nine Months Ended September 30, 2021
Net interest income	$	94	$	78,597		$	(400	)	$	78,291
Provision for credit losses and unfunded loans		0		(473	)		0			(473	)
Service fees, security gains and other noninterest income		8,108		20,726			(128	)		28,706
Noninterest expense		4,818		44,727			(409	)		49,136
Amortization and depreciation expense		194		1,992			244			2,430
Income before taxes		3,190		53,077			(363	)		55,904
Income taxes		669		9,379			(286	)		9,762
Net income	$	2,521	$	43,698		$	(77	)	$	46,142

(In Thousands of Dollars)	Trust Segment		Bank Segment		Eliminations and Others			Consolidated Totals
For Three Months Ended September 30, 2020
Net interest income	$	31	$	24,197	$	(63	)	$	24,165
Provision for credit losses and unfunded loans		0		2,600		0			2,600
Service fees, security gains and other noninterest income		2,357		6,924		(64	)		9,217
Noninterest expense		1,507		15,112		63			16,682
Amortization and depreciation expense		88		632		68			788
Income before taxes		793		12,777		(258	)		13,312
Income taxes		166		2,397		(120	)		2,443
Net income	$	627	$	10,380	$	(138	)	$	10,869

(In Thousands of Dollars)	Trust Segment		Bank Segment		Eliminations and Others			Consolidated Totals
For Nine Months Ended September 30, 2020
Net interest income	$	95	$	70,540	$	(247	)	$	70,388
Provision for credit losses and unfunded loans		0		6,100		0			6,100
Service fees, security gains and other noninterest income		6,922		19,086		(346	)		25,662
Noninterest expense		4,549		45,886		634			51,069
Amortization and depreciation expense		228		1,905		184			2,317
Income before taxes		2,240		35,735		(1,411	)		36,564
Income taxes		470		6,051		(476	)		6,045
Net income	$	1,770	$	29,684	$	(935	)	$	30,519

The Bank segment includes Farmers National Insurance and Farmers of Canfield Investment Co.

XML

Short-term Borrowings

9 Months Ended

Sep. 30, 2021

Debt Disclosure [Abstract]

Short-term Borrowings

Short-term borrowings:

 The Company had  no securities sold under repurchase agreements at September 30, 2021 and $2.2 million in securities sold under repurchase agreements at December 31, 2020.  In addition, the Company had a $350,000 balance on a line of credit with one lending institution at December 31, 2020.  There was no balance on this line at September 30, 2021.  

Securities sold under repurchase agreements are secured by the Bank’s holdings of debt securities issued by U.S. Government sponsored entities and agencies.  These pledged securities which are 105% of the repurchase agreement balances, had a carrying amount of $2.3 million at December 31, 2020.

XML

Long-Term Borrowings

9 Months Ended

Sep. 30, 2021

Debt Disclosure [Abstract]

Long-term Borrowings

Long-term borrowings:

There were $40.0 million in long-term Federal Home Loan Bank Advances at September 30, 2021 with a weighted average interest rate of 1.79%.  Long-term Federal Home Loan Bank Advances were $67.0 million at December 31, 2020 and had a weighted average interest rate of 1.39%.  In addition, the Company had two Trust Preferred Debentures with an outstanding balance of $9.6 million at September 30, 2021 and $9.4 million at December 31, 2020.  Both of these debentures mature in calendar year 2036.  The debentures have a weighted average interest rate of 1.89% and 1.99% at September 30, 2021 and December 31, 2020, respectively.

Long-term and short-term FHLB advances are secured by a blanket pledge of residential mortgage, commercial real estate, and multi-family loans.  Based on this collateral, the Bank is eligible to borrow an additional $579.9 million at September 30, 2021.  The advance is subject to a prepayment penalty if paid prior to its maturity date.

XML

Summary of Significant Accounting Policies (Policies)

6 Months Ended

9 Months Ended

Jun. 30, 2021

Sep. 30, 2021

Accounting Policies [Abstract]

Principles of Consolidation

Principles of Consolidation:

Farmers National Banc Corp. (“Company”) is a Financial Holding Company registered under the Bank Holding Company Act of 1956, as amended.  The Company provides full banking services through its nationally chartered subsidiary, The Farmers National Bank of Canfield (“Bank”).  The consolidated financial statements also include the accounts of the Bank’s subsidiaries; Farmers National Insurance, LLC (“Insurance”) and Farmers of Canfield Investment Co. (“Investments”).  The Company provides trust and retirement consulting services through its subsidiary, Farmers Trust Company (“Trust”), and insurance services through the Bank’s subsidiary, Insurance.  Farmers National Captive, Inc. (“Captive”) is a wholly-owned insurance subsidiary of the Company that provides property and casualty insurance coverage to the Company and its subsidiaries.  The Captive pools resources with eleven other similar insurance company subsidiaries of financial institutions to spread a limited amount of risk among themselves and to provide insurance where not currently available or economically feasible in today’s insurance market place.  The consolidated financial statements include the accounts of the Company, the Bank and its subsidiaries, along with the Trust and Captive.  All significant intercompany balances and transactions have been eliminated in the consolidation.

Basis of Presentation

Basis of Presentation:

The unaudited condensed consolidated financial statements have been prepared in conformity with the instructions to Form 10-Q and Article 10 of Regulation S-X.  Accordingly, they do not include all of the information and footnotes required by U.S. generally accepted accounting principles (“U.S. GAAP”) for complete financial statements.  The financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s 2020 Annual Report to Shareholders included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020 (“2020 Form 10-K”).  The interim consolidated financial statements include all adjustments (consisting of only normal recurring items) that, in the opinion of management, are necessary for a fair presentation of the financial position and results of operations for the periods presented.  The results of operations for the interim periods disclosed herein are not necessarily indicative of the results that may be expected for a full year.  Certain items included in the prior period financial statements were reclassified to conform to the current period presentation. There was no effect on net income or total stockholders’ equity.

Estimates

Estimates:

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.  Actual results could differ from those estimates.

Segments

Segments:

The Company provides a broad range of financial services to individuals and companies in northeastern Ohio and western Pennsylvania.  Operations are managed and financial performance is primarily aggregated and reported in two lines of business, the Bank segment and the Trust segment.

Equity

Equity:

There are 50,000,000 shares authorized and available for issuance as of September 30, 2021.  Outstanding shares at September 30, 2021 were 28,321,581.

Comprehensive Income

Comprehensive Income:

Comprehensive income consists of net income and other comprehensive income.  Other comprehensive income consists of unrealized gains and losses on securities available for sale which are recognized as components of stockholders’ equity, net of tax effect.

Allowance for Credit Losses - Available-for-Sale Securities

Allowance for Credit Losses – Available-for-Sale Securities:  

Securities classified as AFS are those securities that the Company intends to hold for an indefinite period of time, but not necessarily to maturity.  Any decision to sell a security classified as AFS would be based on various factors, including significant movements in interest rates, changes in the maturity mix of the Company’s assets and liabilities, liquidity needs, regulatory capital considerations, and other similar factors.

The Company evaluates AFS securities that are in an unrealized loss position on a quarterly basis to determine whether the decline in fair value below the amortized costs basis is due to credit-related factors or noncredit-related factors.  In making this evaluation, management considers the extent to which the fair value has been less than cost, the financial condition and near-term prospects of the issuer, and the intent and ability of the Company to hold the security for a period of time sufficient to allow for any anticipated recovery in fair value.  Any impairment that is not credit-related is recognized in other comprehensive income, net of related deferred income taxes.  Credit-related impairment is recognized as an allowance for credit losses (“ACL”) on the balance sheet based on the amount by which the amortized cost basis exceeds the fair value, with a corresponding charge to net income.  Both the ACL and the charge to net income may be reversed if conditions change.  However, if the Company intends to sell an impaired AFS security or more likely than not will be required to sell such a security before recovering its amortized cost basis, the entire impairment amount must be recognized in net income with a corresponding adjustment to the security’s amortized cost basis rather than through the establishment of an ACL.  The Company has recorded no ACL related to the investment portfolio as of September 30, 2021.

Allowance for Credit Losses - Loans

Allowance for Credit Losses – Loans:  

The ACL represents management’s estimate of expected credit losses in the Company’s loan portfolio at the balance sheet date.  The Company estimates the ACL based on the amortized cost basis of the underlying loan and has made an accounting policy election to exclude accrued interest from the loan’s amortized cost basis and the related measurement of the ACL.  Estimating the amount of the ACL is a function of a number of factors, including but not limited to changes in the loan portfolio, net charge-offs, trends in past due and nonaccrual loans, and the level of potential problem loans, all of which may be susceptible to significant change.

Prior to January 1, 2021, as described in further detail in the Company’s 2020 Form 10-K, the Company used an incurred loss impairment model.  This methodology assessed the overall appropriateness of the allowance for credit losses and included allocations for specifically identified impaired loans and loss factors for all remaining loans, with a component primarily based on historical loss rates and another component primarily based on other qualitative factors.  Impaired loans were individually assessed and measured based on the present value of expected future cash flows discounted at the loan’s effective interest rate, the loan’s observable market price or the fair value of the collateral if the loan was collateral dependent.  Loans that were determined not to be impaired were collectively evaluated for impairment, stratified by type and allocated loss ranges based on the Company’s actual historical loss ratios for each strata, and adjustments were also provided for certain environmental and other qualitative factors.

On January 1, 2021, the Company adopted the current expected credit loss model (“CECL”).  This methodology for calculating the allowance for credit losses considers the possibility of loss over the life of the loan.  It also considers historical loss rates and other qualitative adjustments, as well as a new forward-looking component that considers reasonable and supportable forecasts over the expected life of each loan.  To develop the ACL estimate under the current expected loss model, the Company segments the loan portfolio into loan pools based on loan type and similar credit risk elements.  The Company uses the cohort (“cohort”) and the probability of default/loss given default (“PD/LGD”) methodologies as described in the Credit Quality Indicators section of the loan footnote. Under ASC 326, if a loan does not share similar risk characteristics with loans in that pool, expected credit losses for that loan are evaluated individually.  The Bank has established specific thresholds for the loan portfolio that trigger when loans need to be evaluated individually.    

In addition, ASC Topic 326 requires the Company to establish a separate liability for anticipated credit losses for unfunded commitments.  The Company previously included this reserve in the ACL but it is now recorded as a reserve in other liabilities.  As of September 30, 2021 the balance was $437 thousand.

Risks and Uncertainties

Risks and Uncertainties:

The outbreak of COVID-19 has adversely impacted a broad range of industries in which the Company’s customers operate and could impair their ability to fulfill their financial obligations to the Company.  In addition, it has caused disruptions in the economy and has disrupted banking and other financial activity in the areas in which the Company operates, including but not limited to the current interest rate environment, increased inflation pressure, borrower and counterparty credit quality and market volatility.  While there has been no material impact to the Company’s business continuity or financial condition, the possibility of future challenges relating to COVID-19 remains.  

Congress, the President, and the Federal Reserve have taken several actions designed to cushion the economic fallout.  Most notably, the Coronavirus Aid, Relief and Economic Security Act (“CARES”) and the Health and Economic Recovery Omnibus Emergency Solutions Act (“HEROES”), both signed into law during 2020, were multi trillion dollar legislative packages, and the American Rescue Plan Act (“American Rescue Plan”) signed into law on March 11, 2021, was a $1.9 trillion COVID-19 relief bill.  The goal of these acts was to provide economic stability during the pandemic through various measures, including direct financial aid to American families and economic stimulus to significantly impacted industry sectors.  The packages also included extensive emergency funding for hospitals and providers. The American Rescue Plan continued these measures by funding increases in vaccine distribution, additional cash payments to millions of Americans, extended unemployment benefits, and support for caregiving, nutrition programs, health care and pensions.  In addition to the general impact of COVID-19, certain provisions of these legislative acts, as well as other recent legislative and regulatory relief efforts, have had a material impact on the Company’s operations.

The Company’s business is dependent upon the willingness and ability of its employees and customers to conduct banking and other financial transactions.  If the global response to contain COVID-19, and any new variants, continues for an extended period or is ultimately unsuccessful, the Company could experience a material adverse effect on its business, financial condition, results of operations and cash flows.  While it is not possible to know the full universe or extent that the impact of COVID-19 will have on the Company’s operations, the Company will disclose potentially material items of which it becomes aware.

Financial position and results of operations:

A majority of the Company’s fee income declined and could be reduced further due to lingering COVID-19 affects.  In keeping with guidance from regulators, the Company worked with COVID-19 affected customers to waive fees from a variety of sources, such as, but not limited to, insufficient funds and overdraft fees, ATM fees, account maintenance fees.  From the beginning of the pandemic in 2020 through the quarter ended September 30, 2021, the Company has waived $780 thousand in fees.  The Company recognizes that the breadth of the economic impact is likely to continue impacting its fee income in future periods.

The Company’s interest income improved in the quarter ended September 30, 2021, compared to the same period in 2020 and yet the net interest margin decreased by 8 basis points.  The margin could be reduced further due to COVID-19 and the continued low interest rate environment.  In keeping with guidance from regulators, the Company worked with COVID-19 affected borrowers to defer their payments.  Currently the Bank has one loan remaining that is deferring its loan payment.  While interest and fees will still accrue to income, through normal GAAP accounting, should eventual credit losses on these deferred payments emerge, interest income and fees accrued would need to be reversed.  In such a scenario, interest income in future periods could be negatively impacted.  At this time, the Company is unable to project the materiality of such an impact, but recognizes the breadth of the economic impact may affect its borrowers’ ability to repay in future periods.

Capital and liquidity

Capital and liquidity:

While the Company believes that it has sufficient capital to withstand an extended economic recession brought about by COVID-19, its reported and regulatory capital ratios could be adversely impacted by further credit losses.  The Company relies on cash on hand as well as dividends from its subsidiaries.  If the Company’s capital deteriorates such that the Bank is unable to pay dividends to it for an extended period of time, the Company may not be able to pay dividends to shareholders.

The Company maintains access to multiple sources of liquidity.  Wholesale funding markets have remained open.  Rates for short term funding have recently been low but if funding costs are elevated for an extended period of time, it could have an adverse effect on the Company’s net interest margin.  If an extended recession caused large numbers of the Company’s deposit customers to withdraw their funds, the Company might become more reliant on volatile or more expensive sources of funding.

New Accounting Standards

New Accounting Standards:

In June 2016, the FASB issued ASU 2016-13: Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (modified by ASU 2019-04, Codification Improvements to Topic 326, Financial Instruments Credit Losses).  The ASU requires an organization to measure all expected credit losses for financial assets held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts.  Financial institutions and other organizations will now use forward-looking information to better inform their credit loss estimates.  Many of the loss estimation techniques applied today will still be permitted, although the inputs to those techniques changed to reflect the full amount of expected credit losses.  Organizations will continue to use judgment to determine which loss estimation method is appropriate for their circumstances.  Additionally, the ASU amends the accounting for credit losses on available for sale debt securities and purchased financial assets with credit deterioration.  ASU 2016-13 is effective for public companies for annual periods beginning after December 15, 2019.  Entities will apply the standard’s provisions as a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is adopted.

In accordance with the accounting relief provisions of CARES and subsequent provisions of HEROES, the Bank postponed the adoption of the current expected credit losses (“CECL”) accounting standard from January 1, 2020 to January 1, 2021.  The Company adopted ASC 326 using the modified retrospective method for all financial assets measured at amortized cost and off-balance-sheet credit exposures.  Results for reporting periods beginning after January 1, 2021 are presented under ASC 326 while prior period amounts continue to be reported in accordance with previously applicable GAAP.  The Company recorded the onetime adjustment to equity in the amount of $1.9 million, net of tax which increased the allowance for credit losses $2.5 million.

XML

Business Combinations (Tables)

9 Months Ended

Sep. 30, 2021

Pro Forma Information

The pro forma financial information is not necessarily indicative of the results of operations that would have occurred had the transactions been effective on the assumed date.

(In thousands of dollars except per share results)	For Nine Months Ended Sept. 30, 2020
Net interest income	$	70,568
Net income	$	30,539
Basic earnings per share	$	1.08
Diluted earnings per share	$	1.07

Maple Leaf

Summary of Consideration Paid and Amounts of Assets Acquired and Liabilities Assumed

The following table summarizes the consideration paid for Maple Leaf and the amounts of the assets acquired and liabilities assumed on the closing date of the acquisition.

(In Thousands of Dollars)
Consideration
Cash	$	20,423
Stock		22,554
Fair value of total consideration transferred	$	42,977
Fair value of assets acquired
Cash and due from financial institutions	$	18,219
Securities available for sale		69,547
Loans		181,280
Premises and equipment		229
Core deposit intangible		725
Other assets		6,398
Total assets		276,398
Fair value of liabilities assumed
Deposits		183,251
Long-term borrowings		54,487
Accrued interest payable and other liabilities		3,257
Total liabilities	$	240,995
Net assets acquired		35,403
Goodwill created		7,574
Total net assets acquired	$	42,977

XML

Securities (Tables)

9 Months Ended

Sep. 30, 2021

Investments Debt And Equity Securities [Abstract]

Summary of the Amortized Cost and Fair Value of Available-for-Sale Investment Securities Corresponding Amounts of Unrealized Gains and Losses

The following table summarizes the amortized cost and fair value of the available for sale investment securities portfolio at September 30, 2021 and December 31, 2020 and the corresponding amounts of unrealized gains and losses recognized in accumulated other comprehensive income:

			Gross		Gross
	Amortized		Unrealized		Unrealized
(In Thousands of Dollars)	Cost		Gains		Losses			Fair Value
September 30, 2021
U.S. Treasury and U.S. government sponsored entities	$	89,919	$	53	$	(1,502	)	$	88,470
State and political subdivisions		485,125		22,776		(618	)		507,283
Corporate bonds		3,604		77		(14	)		3,667
Mortgage-backed securities - residential		569,235		2,778		(5,909	)		566,104
Collateralized mortgage obligations - residential		12,956		290		(5	)		13,241
Small Business Administration		4,471		125		0			4,596
Totals	$	1,165,310	$	26,099	$	(8,048	)	$	1,183,361

			Gross		Gross
	Amortized		Unrealized		Unrealized
(In Thousands of Dollars)	Cost		Gains		Losses			Fair Value
December 31, 2020
U.S. Treasury and U.S. government sponsored entities	$	11,798	$	101	$	(54	)	$	11,845
State and political subdivisions		344,160		22,350		(204	)		366,306
Corporate bonds		3,582		132		(2	)		3,712
Mortgage-backed securities - residential		157,106		4,919		(243	)		161,782
Collateralized mortgage obligations - residential		25,654		742		(3	)		26,393
Small Business Administration		5,411		151		0			5,562
Totals	$	547,711	$	28,395	$	(506	)	$	575,600

Amortized Cost and Fair Value of the Debt Securities Maturity

The amortized cost and fair value of the debt securities portfolio are shown by expected maturity.  Expected maturities may differ from contractual maturities if issuers have the right to call or prepay obligations with or without call or prepayment penalties. Securities not due at a single maturity date are shown separately.

	September 30, 2021
(In Thousands of Dollars)	Amortized Cost		Fair Value
Maturity
Within one year	$	3,791	$	3,820
One to five years		10,360		10,967
Five to ten years		125,179		125,944
Beyond ten years		439,318		458,689
Mortgage-backed, collateralized mortgage obligations and Small Business Administration securities		586,662		583,941
Total	$	1,165,310	$	1,183,361

Available for Sale Investment Securities with Unrealized Losses

The following table summarizes the available for sale investment securities with unrealized losses at September 30, 2021 and December 31, 2020, aggregated by major security type and length of time in a continuous unrealized loss position.

	Less than 12 Months					12 Months or Longer					Total
	Fair		Unrealized			Fair		Unrealized			Fair		Unrealized
(In Thousands of Dollars)	Value		Loss			Value		Loss			Value		Loss
September 30, 2021
U.S. Treasury and U.S. government sponsored entities	$	84,849	$	(1,479	)	$	627	$	(23	)	$	85,476	$	(1,502	)
State and political subdivisions		64,442		(562	)		4,579		(56	)		69,021		(618	)
Corporate bonds		533		(11	)		197		(3	)		730		(14	)
Mortgage-backed securities - residential		390,783		(5,909	)		10		0			390,793		(5,909	)
Collateralized mortgage obligations - residential		1,419		(2	)		249		(3	)		1,668		(5	)
Total	$	542,026	$	(7,963	)	$	5,662	$	(85	)	$	547,688	$	(8,048	)

	Less than 12 Months					12 Months or Longer				Total
	Fair		Unrealized			Fair		Unrealized		Fair		Unrealized
(In Thousands of Dollars)	Value		Loss			Value		Loss		Value		Loss
December 31, 2020
U.S. Treasury and U.S. government sponsored entities	$	8,153	$	(54	)	$	0	$	0	$	8,153	$	(54	)
State and political subdivisions		19,205		(204	)		0		0		19,205		(204	)
Corporate bonds		198		(2	)		0		0		198		(2	)
Mortgage-backed securities - residential		63,401		(243	)		0		0		63,401		(243	)
Collateralized mortgage obligations - residential		294		(3	)		0		0		294		(3	)
Total	$	91,251	$	(506	)	$	0	$	0	$	91,251	$	(506	)

XML

Loans (Tables)

9 Months Ended

Sep. 30, 2021

Receivables [Abstract]

Schedule of Loan Balances

Acquired loans were transferred and are included in originated loans at period ended September 30, 2021.  This is to align with the calculation of the allowance for credit losses being used under the CECL model.  Loan balances were as follows:

(In Thousands of Dollars)	September 30, 2021			December 31, 2020
Originated loans:
Commercial real estate
Owner occupied	$	260,556		$	215,187
Non-owner occupied		351,407			309,777
Farmland		176,190			156,277
Other		78,444			78,140
Commercial
Commercial and industrial		302,356			385,831
Agricultural		50,707			44,922
Residential real estate
1-4 family residential		376,901			324,723
Home equity lines of credit		106,750			92,968
Consumer
Indirect		158,617			164,620
Direct		21,520			23,348
Other		9,359			9,868
Total originated loans	$	1,892,807		$	1,805,661
Acquired loans:
Commercial real estate
Owner occupied	$	0		$	45,101
Non-owner occupied		0			52,863
Farmland		0			26,080
Other		0			12,868
Commercial
Commercial and industrial		0			18,662
Agricultural		0			4,850
Residential real estate
1-4 family residential		0			89,118
Home equity lines of credit		0			17,383
Consumer
Direct		0			5,128
Other		0			97
Total acquired loans	$	0		$	272,150
Net Deferred loan (fees) costs		1,409			233
Allowance for credit losses		(23,136	)		(22,144	)
Net loans	$	1,871,080		$	2,055,900

Activity in the Allowance for Loan Losses by Portfolio Segment

Allowance for credit loss activity

The following tables present the activity in the allowance for credit losses by portfolio segment for the three and nine month periods ended September 30, 2021 and the activity in the allowance for loan losses by portfolio segment for the three and nine month periods ended September 30, 2020:

Three Months Ended September 30, 2021

(In Thousands of Dollars)	Commercial Real Estate			Commercial			Residential Real Estate			Consumer			Total
Allowance for credit losses
Beginning balance	$	12,290		$	4,600		$	4,130		$	3,786		$	24,806
Adjustment related to reserve for unfunded loan reclass	$	(245	)	$	(104	)	$	(73	)	$	(15	)		(437	)
Provision for credit losses		(454	)		(655	)		75			87			(947	)
Loans charged off		(31	)		(126	)		(55	)		(199	)		(411	)
Recoveries		1			15			41			68			125
Total ending allowance balance	$	11,561		$	3,730		$	4,118		$	3,727		$	23,136

Nine Months Ended September 30, 2021

(In Thousands of Dollars)	Commercial Real Estate			Commercial			Residential Real Estate			Consumer			Total
Allowance for credit losses
Beginning balance	$	10,824		$	5,073		$	3,643		$	2,604		$	22,144
Adjustment related to reserve for unfunded loan reclass		(245	)		(104	)		(73	)		(15	)		(437	)
Impact of CECL adoption		(2,076	)		429			237			3,860			2,450
Provision for credit losses		3,077			(1,668	)		411			(2,292	)		(472	)
Loans charged off		(51	)		(198	)		(221	)		(727	)		(1,197	)
Recoveries		32			198			121			297			648
Total ending allowance balance	$	11,561		$	3,730		$	4,118		$	3,727		$	23,136

Three Months Ended September 30, 2020

(In Thousands of Dollars)	Commercial Real Estate			Commercial			Residential Real Estate			Consumer			Total
Allowance for credit losses
Beginning balance	$	7,972		$	3,293		$	2,991		$	2,704		$	16,960
Provision for credit losses		1,052			1,090			414			44			2,600
Loans charged off		(20	)		(92	)		(22	)		(259	)		(393	)
Recoveries		2			1			14			157			174
Total ending allowance balance	$	9,006		$	4,292		$	3,397		$	2,646		$	19,341

Nine Months Ended September 30, 2020

(In Thousands of Dollars)	Commercial Real Estate			Commercial			Residential Real Estate			Consumer			Total
Allowance for credit losses
Beginning balance	$	6,156		$	2,447		$	3,029		$	2,855		$	14,487
Provision for credit losses		2,961			2,176			490			473			6,100
Loans charged off		(117	)		(340	)		(163	)		(1,046	)		(1,666	)
Recoveries		6			9			41			364			420
Total ending allowance balance	$	9,006		$	4,292		$	3,397		$	2,646		$	19,341

Schedule of Investment in Nonaccrual and Loans Past Due 90 Days or More Still on Accrual by Class of Loans

The following table presents the recorded investment in nonaccrual and loans past due 90 days or more still on accrual by class of loans as of September 30, 2021 and December 31, 2020:

	September 30, 2021				December 31, 2020
(In Thousands of Dollars)	Nonaccrual		Loans Past Due 90 Days or More Still Accruing		Nonaccrual		Loans Past Due 90 Days or More Still Accruing
Originated loans:
Commercial real estate
Owner occupied	$	452	$	0	$	0	$	335
Non-owner occupied		2,627		0		0		0
Farmland		277		0		0		0
Commercial
Commercial and industrial		5,177		3		3,312		22
Agricultural		34		0		205		0
Residential real estate
1-4 family residential		3,960		466		866		223
Home equity lines of credit		718		137		603		0
Consumer
Indirect		462		101		648		64
Direct		261		69		157		111
Other		0		0		1		5
Total originated loans	$	13,968	$	776	$	5,792	$	760
Acquired loans:
Commercial real estate
Owner occupied	$	0	$	0	$	27	$	0
Non-owner occupied		0		0		362		0
Farmland		0		0		471		95
Commercial
Commercial and industrial		0		0		477		0
Agricultural		0		0		4		0
Residential real estate
1-4 family residential		0		0		4,128		1,469
Home equity lines of credit		0		0		186		0
Consumer
Direct		0		0		58		6
Total acquired loans	$	0	$	0	$	5,713	$	1,570
Total loans	$	13,968	$	776	$	11,505	$	2,330

Schedule of Investment in Past Due Loans

The following tables present the aging of the recorded investment in past due loans as of September 30, 2021 and December 31, 2020 by class of loans.  Note that loans on a current modification to defer payments under the CARES Act are included in loans not past due.

(In Thousands of Dollars)	30-59 Days Past Due		60-89 Days Past Due		90 Days or More Past Due and Nonaccrual		Total Past Due		Loans Not Past Due		Total
September 30, 2021
Commercial real estate
Owner occupied	$	72	$	0	$	452	$	524	$	259,656	$	260,180
Non-owner occupied		0		0		2,627		2,627		348,267		350,894
Farmland		356		0		277		633		175,297		175,930
Other		0		0		0		0		78,217		78,217
Commercial
Commercial and industrial		112		358		5,180		5,650		294,434		300,084
Agricultural		87		9		34		130		50,756		50,886
Residential real estate
1-4 family residential		3,399		845		4,426		8,670		367,333		376,003
Home equity lines of credit		253		28		855		1,136		105,622		106,758
Consumer
Indirect		874		57		563		1,494		162,812		164,306
Direct		375		78		330		783		20,816		21,599
Other		33		8		0		41		9,318		9,359
Total loans	$	5,561	$	1,383	$	14,744	$	21,688	$	1,872,528	$	1,894,216

(In Thousands of Dollars)	30-59 Days Past Due		60-89 Days Past Due		90 Days or More Past Due and Nonaccrual		Total Past Due		Loans Not Past Due		Total
December 31, 2020
Originated loans:
Commercial real estate
Owner occupied	$	0	$	0	$	335	$	335	$	214,460	$	214,795
Non-owner occupied		0		0		0		0		309,216		309,216
Farmland		0		0		0		0		156,053		156,053
Other		261		0		0		261		77,725		77,986
Commercial
Commercial and industrial		356		61		3,334		3,751		378,594		382,345
Agricultural		45		255		205		505		44,555		45,060
Residential real estate
1-4 family residential		1,668		974		1,089		3,731		320,129		323,860
Home equity lines of credit		419		0		603		1,022		91,957		92,979
Consumer
Indirect		1,046		285		712		2,043		168,245		170,288
Direct		284		120		268		672		22,789		23,461
Other		24		22		6		52		9,816		9,868
Total originated loans	$	4,103	$	1,717	$	6,552	$	12,372	$	1,793,539	$	1,805,911
Acquired loans:
Commercial real estate
Owner occupied	$	0	$	0	$	27	$	27	$	45,072	$	45,099
Non-owner occupied		197		0		362		559		52,295		52,854
Farmland		0		0		566		566		25,513		26,079
Other		0		0		0		0		12,868		12,868
Commercial
Commercial and industrial		19		390		477		886		17,772		18,658
Agricultural		4		0		4		8		4,841		4,849
Residential real estate
1-4 family residential		1,954		821		5,597		8,372		80,745		89,117
Home equity lines of credit		23		0		186		209		17,175		17,384
Consumer
Direct		20		49		64		133		4,995		5,128
Other		0		0		0		0		97		97
Total acquired loans	$	2,217	$	1,260	$	7,283	$	10,760	$	261,373	$	272,133
Total loans	$	6,320	$	2,977	$	13,835	$	23,132	$	2,054,912	$	2,078,044

XML

Troubled Debt Restructurings (Tables)

9 Months Ended

Sep. 30, 2021

Debt Disclosure [Abstract]

Schedule of Loans By Class Modified as Troubled Debt Restructurings

The following table presents loans by class modified as troubled debt restructurings that occurred during the three and nine month periods ended September 30, 2021 and 2020:

			Pre- Modification		Post- Modification
Three Months Ended September 30, 2021	Number of		Outstanding Recorded		Outstanding Recorded
(In Thousands of Dollars)	Loans		Investment		Investment
Residential real estate
1-4 family residential		2	$	215	$	233
Home equity lines of credit		1		103		103
Consumer
Indirect		5		30		30
Direct		1		10		10
Total loans		9	$	358	$	376

			Pre- Modification		Post- Modification
Nine Months Ended September 30, 2021	Number of		Outstanding Recorded		Outstanding Recorded
(In Thousands of Dollars)	Loans		Investment		Investment
Commercial		4	$	22	$	22
Residential real estate
1-4 family residential		6		426		414
Home equity lines of credit		5		201		201
Consumer
Indirect		12		121		121
Direct		3		16		16
Total loans		30	$	786	$	774

			Pre- Modification		Post- Modification
Three Months Ended September 30, 2020	Number of		Outstanding Recorded		Outstanding Recorded
(In Thousands of Dollars)	Loans		Investment		Investment
Originated loans:
Consumer
Indirect		2	$	3	$	3
Total originated loans		2	$	3	$	3
Acquired loans:
Residential real estate
1-4 family residential		1		60		64
Total acquired loans		1	$	60	$	64
Total loans		3	$	63	$	67

			Pre- Modification		Post- Modification
Nine Months Ended September 30, 2020	Number of		Outstanding Recorded		Outstanding Recorded
(In Thousands of Dollars)	Loans		Investment		Investment
Originated loans:
Commercial		1	$	21	$	21
Residential real estate
1-4 family residential		6		245		246
Home equity lines of credit		4		100		102
Consumer
Indirect		19		124		124
Other		1		15		15
Total originated loans		31	$	505	$	508
Acquired loans:
1-4 family residential		3		140		144
Total acquired loans		3	$	140	$	144
Total loans		34	$	645	$	652

XML

Credit Quality Indicators (Tables)

9 Months Ended

Sep. 30, 2021

Risks And Uncertainties [Abstract]

Risk Category of Loans by Class of Loans

As of September 30, 2021 and December 31, 2020, and based on the most recent analysis performed, the risk category of loans by class of loans is as follows:

(In Thousands of Dollars)	Pass		Special Mention		Sub standard		Total
September 30, 2021
Commercial real estate
Owner occupied	$	251,517	$	6,470	$	2,193	$	260,180
Non-owner occupied		326,515		14,500		9,879		350,894
Farmland		172,370		2,174		1,386		175,930
Other		77,304		773		140		78,217
Commercial
Commercial and industrial		291,700		536		7,848		300,084
Agricultural		50,268		521		97		50,886
Total loans	$	1,169,674	$	24,974	$	21,543	$	1,216,191

(In Thousands of Dollars)	Pass		Special Mention		Sub standard		Total
December 31, 2020
Originated loans:
Commercial real estate
Owner occupied	$	208,289	$	5,121	$	1,385	$	214,795
Non-owner occupied		290,773		11,240		7,203		309,216
Farmland		153,225		2,464		364		156,053
Other		77,432		387		167		77,986
Commercial
Commercial and industrial		372,083		1,522		8,740		382,345
Agricultural		44,527		320		213		45,060
Total originated loans	$	1,146,329	$	21,054	$	18,072	$	1,185,455
Acquired loans:
Commercial real estate
Owner occupied	$	44,031	$	87	$	981	$	45,099
Non-owner occupied		50,053		49		2,752		52,854
Farmland		24,637		100		1,342		26,079
Other		12,868		0		0		12,868
Commercial
Commercial and industrial		16,246		0		2,412		18,658
Agricultural		4,481		303		65		4,849
Total acquired loans	$	152,316	$	539	$	7,552	$	160,407
Total loans	$	1,298,645	$	21,593	$	25,624	$	1,345,862

Investment in Residential, Consumer and Indirect Auto Loans Based on Payment Activity

The following tables present the recorded investment in residential, consumer indirect and direct auto loans based on payment activity as of September 30, 2021 and December 31, 2020.  Nonperforming loans are loans past due 90 days or more and still accruing interest and nonaccrual loans.

	Residential Real Estate				Consumer
(In Thousands of Dollars)	1-4 Family Residential		Home Equity Lines of Credit		Indirect		Direct		Other
September 30, 2021
Performing	$	371,577	$	105,903	$	163,743	$	21,269	$	9,359
Nonperforming		4,426		855		563		330		0
Total loans	$	376,003	$	106,758	$	164,306	$	21,599	$	9,359

	Residential Real Estate				Consumer
(In Thousands of Dollars)	1-4 Family Residential		Home Equity Lines of Credit		Indirect		Direct		Other
December 31, 2020
Originated loans:
Performing	$	322,771	$	92,376	$	169,576	$	23,193	$	9,862
Nonperforming		1,089		603		712		268		6
Total originated loans	$	323,860	$	92,979	$	170,288	$	23,461	$	9,868
Acquired loans:
Performing	$	83,520	$	17,198	$	0	$	5,064	$	97
Nonperforming		5,597		186		0		64		0
Total acquired loans		89,117		17,384		0		5,128		97
Total loans	$	412,977	$	110,363	$	170,288	$	28,589	$	9,965

Risk Categories and Year of Origination

The following table presents total loans by risk categories and year of origination.

	Term Loans Amortized Cost Basis by Origination Year
As of September 30, 2021	2021		2020		2019		2018		2017		Prior		Revolving Loans		Total
Commercial real estate
Risk Rating
Pass	$	79,167	$	103,241	$	128,436	$	93,100	$	65,831	$	169,999	$	15,562	$	655,336
Special mention		773		0		9,518		1,716		2,892		6,365		479		21,743
Substandard		0		327		2,284		502		90		8,888		121		12,212
Total commercial real estate loans	$	79,940	$	103,568	$	140,238	$	95,318	$	68,813	$	185,252	$	16,162	$	689,291
Commercial
Risk Rating
Pass	$	90,549	$	59,498	$	25,933	$	29,075	$	11,732	$	18,807	$	56,106	$	291,700
Special mention		220		106		87		0		0		0		123		536
Substandard		3,119		1,881		334		265		814		84		1,351		7,848
Total commercial loans	$	93,888	$	61,485	$	26,354	$	29,340	$	12,546	$	18,891	$	57,580	$	300,084
Agricultural
Risk Rating
Pass	$	30,585	$	54,038	$	30,248	$	31,198	$	20,075	$	38,288	$	18,206	$	222,638
Special mention		0		238		33		0		2,075		0		349		2,695
Substandard		356		21		66		13		0		997		30		1,483
Total agricultural loans	$	30,941	$	54,297	$	30,347	$	31,211	$	22,150	$	39,285	$	18,585	$	226,816
Residential real estate
Risk Rating
Pass	$	48,989	$	78,879	$	37,697	$	29,361	$	39,854	$	129,640	$	2,685	$	367,105
Special mention		0		0		0		0		0		0		0		0
Substandard		50		0		23		54		588		8,183		0		8,898
Total residential real estate loans	$	49,039	$	78,879	$	37,720	$	29,415	$	40,442	$	137,823	$	2,685	$	376,003
Home equity lines of credit
Risk Rating
Pass	$	146	$	0	$	0	$	0	$	99	$	1,213	$	103,502	$	104,960
Special mention		0		0		0		0		0		0		48		48
Substandard		0		0		20		74		77		1,357		222		1,750
Total home equity lines of credit	$	146	$	0	$	20	$	74	$	176	$	2,570	$	103,772	$	106,758
Consumer
Risk Rating
Pass	$	46,676	$	50,526	$	39,119	$	23,551	$	11,356	$	16,516	$	6,194	$	193,938
Special mention		0		0		0		0		0		0		0		0
Substandard		32		321		173		205		162		433		0		1,326
Total consumer loans	$	46,708	$	50,847	$	39,292	$	23,756	$	11,518	$	16,949	$	6,194	$	195,264

XML

Revenue from Contracts with Customers (Tables)

9 Months Ended

Sep. 30, 2021

Revenue From Contract With Customer [Abstract]

Summary of Noninterest Income by Revenue Stream and Reportable Segment, Net of Eliminations

All material revenue from contracts with customers in the scope of ASC 606 is recognized within noninterest income.  The following table presents the Company’s noninterest income by revenue stream and reportable segment, net of eliminations, for the three and nine months ended September 30, 2021 and 2020.

(In Thousands of Dollars)	Trust Segment		Bank Segment		Totals
For Three Months Ended September 30, 2021
Service charges on deposit accounts	$	0	$	924	$	924
Debit card and EFT fees		0		1,128		1,128
Trust fees		2,335		0		2,335
Insurance agency commissions		0		799		799
Retirement plan consulting fees		334		0		334
Investment commissions		0		638		638
Other (outside the scope of ASC 606)		0		2,857		2,857
Total noninterest income	$	2,669	$	6,346	$	9,015

(In Thousands of Dollars)	Trust Segment		Bank Segment		Totals
For Three Months Ended September 30, 2020
Service charges on deposit accounts	$	0	$	904	$	904
Debit card and EFT fees		0		1,048		1,048
Trust fees		1,973		0		1,973
Insurance agency commissions		0		784		784
Retirement plan consulting fees		341		0		341
Investment commissions		0		353		353
Other (outside the scope of ASC 606)		0		3,814		3,814
Total noninterest income	$	2,314	$	6,903	$	9,217

(In Thousands of Dollars)	Trust Segment		Bank Segment		Totals
For Nine Months Ended September 30, 2021
Service charges on deposit accounts	$	0	$	2,522	$	2,522
Debit card and EFT fees		0		3,438		3,438
Trust fees		6,929		0		6,929
Insurance agency commissions		0		2,748		2,748
Retirement plan consulting fees		1,043		0		1,043
Investment commissions		0		1,665		1,665
Other (outside the scope of ASC 606)		0		10,361		10,361
Total noninterest income	$	7,972	$	20,734	$	28,706

(In Thousands of Dollars)	Trust Segment		Bank Segment		Totals
For Nine Months Ended September 30, 2020
Service charges on deposit accounts	$	0	$	2,752	$	2,752
Debit card and EFT fees		0		2,866		2,866
Trust fees		5,682		0		5,682
Insurance agency commissions		0		2,348		2,348
Retirement plan consulting fees		1,129		0		1,129
Investment commissions		0		1,080		1,080
Other (outside the scope of ASC 606)		0		9,805		9,805
Total noninterest income	$	6,811	$	18,851	$	25,662

XML

Fair Value (Tables)

9 Months Ended

Sep. 30, 2021

Fair Value Disclosures [Abstract]

Assets Measured at Fair Value on Recurring Basis

Assets measured at fair value on a recurring basis are summarized below:

	Fair Value Measurements at September 30, 2021 Using:
(In Thousands of Dollars)	Carrying Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Financial Assets
Investment securities available-for sale
U.S. Treasury and U.S. government sponsored entities	$	88,470	$	0	$	88,470	$	0
State and political subdivisions		507,283		0		507,283		0
Corporate bonds		3,667		0		3,667		0
Mortgage-backed securities-residential		566,104		0		566,101		3
Collateralized mortgage obligations		13,241		0		13,241		0
Small Business Administration		4,596		0		4,596		0
Equity securities
Equity securities at fair value		493		493		0		0
Other investments measured at net asset value		6,024	n/a		n/a		n/a
Total investment securities	$	1,189,878	$	493	$	1,183,358	$	3
Interest rate swaps	$	2,768	$	0	$	2,768	$	0
Financial Liabilities
Interest rate swaps	$	2,768	$	0	$	2,768	$	0

	Fair Value Measurements at December 31, 2020 Using:
(In Thousands of Dollars)	Carrying Value		Quoted Prices  in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Financial Assets
Investment securities available-for sale
U.S. Treasury and U.S. government sponsored entities	$	11,845	$	0	$	11,845	$	0
State and political subdivisions		366,306		0		366,306		0
Corporate bonds		3,712		0		3,712		0
Mortgage-backed securities-residential		161,782		0		161,778		4
Collateralized mortgage obligations		26,393		0		26,393		0
Small Business Administration		5,562		0		5,562		0
Equity securities
Equity securities at fair value		538		538		0		0
Other investments measured at net asset value		6,343	n/a		n/a		n/a
Total investment securities	$	582,481	$	538	$	575,596	$	4
Interest rate swaps	$	4,221	$	0	$	4,221	$	0
Financial Liabilities
Interest rate swaps	$	4,221	$	0	$	4,221	$	0

Reconciliation of All Assets Measured at Fair Value on Recurring Basis Using Significant Unobservable Inputs

The table below presents a reconciliation of all assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3):

	Investment Securities Available-for-sale (Level 3)
	Three Months ended September 30,				Nine Months ended September 30,
(In Thousands of Dollars)	2021		2020		2021			2020
Beginning Balance	$	3	$	4	$	4		$	5
Transfers from level 2		0		0		0			0
Repayments, calls and maturities		0		0		(1	)		(1	)
Ending Balance	$	3	$	4	$	3		$	4

Assets Measured at Fair Value on Non-Recurring Basis

Assets measured at fair value on a non-recurring basis are summarized below:

	Fair Value Measurements at September 30, 2021 Using:
(In Thousands of Dollars)	Carrying Value		Quoted Prices  in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Financial Assets
Commercial
Commercial and industrial	$	2,954	$	0	$	0	$	2,954
1–4 family residential		82		0		0		82

	Fair Value Measurements at December 31, 2020 Using:
(In Thousands of Dollars)	Carrying Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Financial Assets
Impaired loans
Commercial	$	1,770	$	0	$	0	$	1,770
1–4 family residential		82		0		0		82
Consumer		36		0		0		36

Fair Value Measurements for Financial Instruments

The following table presents quantitative information about Level 3 fair value measurements for financial instruments measured at fair value on a non-recurring basis at the periods ended September 30, 2021 and December 31, 2020:

September 30, 2021	Fair value		Valuation Technique(s)	Unobservable Input(s)	Range (Weighted Average)
Individually evaluated loans
Commercial	$	2,954	Sales Comparison	Adjustment for differences between comparable sales	(14.66%) - 8.99% (0%)
Residential		82	Sales comparison	Adjustment for differences between comparable sales	(3.84%) - 3.22% (0.12%)

December 31, 2020	Fair value		Valuation Technique(s)	Unobservable Input(s)	Range (Weighted Average)
Impaired loans
Commercial	$	1,770	Sales comparison	Adjustment for differences between comparable sales	(24.01%) - 17.93% (0.48%)
Residential		82	Sales comparison	Adjustment for differences between comparable sales	(40.00%) - 47.15% (17.77%)
Consumer		36	Sales comparison	Adjustment for differences between comparable sales	(23.60%) - 23.60% (0.00%)

Carrying Amounts and Estimated Fair Values of Financial Instruments

The carrying amounts and estimated fair values of financial instruments not previously disclosed at September 30, 2021 and December 31, 2020 are as follows:

			Fair Value Measurements at September 30, 2021 Using:
(In Thousands of Dollars)	Carrying Amount		Level 1		Level 2		Level 3		Total
Financial assets
Cash and cash equivalents	$	79,808	$	26,933	$	52,875	$	0	$	79,808
Restricted stock		12,524	n/a		n/a		n/a		n/a
Loans held for sale		2,628		0		2,707		0		2,707
Loans, net		1,871,080		0		0		1,857,184		1,857,184
Accrued interest receivable		9,930		0		5,126		4,804		9,930
Financial liabilities
Deposits		2,866,413		2,514,758		350,919		0		2,865,677
Long-term borrowings		49,649		0		49,267		0		49,267
Accrued interest payable		389		26		363		0		389

			Fair Value Measurements at December 31, 2020 Using:
(In Thousands of Dollars)	Carrying Amount		Level 1		Level 2		Level 3		Total
Financial assets
Cash and cash equivalents	$	254,621	$	20,503	$	234,118	$	0	$	254,621
Restricted stock		14,647	n/a		n/a		n/a		n/a
Loans held for sale		4,766		0		4,909		0		4,909
Loans, net		2,055,900		0		0		2,036,872		2,036,872
Accrued interest receivable		9,880		0		3,297		6,583		9,880
Financial liabilities
Deposits		2,610,878		2,097,732		487,105		0		2,584,837
Short-term borrowings		2,521		0		2,521		0		2,521
Long-term borrowings		76,385		0		77,189		0		77,189
Accrued interest payable		690		36		654		0		690

XML

Goodwill and Intangible Assets (Tables)

9 Months Ended

Sep. 30, 2021

Goodwill And Intangible Assets Disclosure [Abstract]

Acquired Intangible Assets

Acquired intangible assets were as follows:

	September 30, 2021					December 31, 2020
(In Thousands of Dollars)	Gross Carrying Amount		Accumulated Amortization			Gross Carrying Amount		Accumulated Amortization
Amortized intangible assets:
Customer relationship intangibles	$	7,210	$	(6,557	)	$	7,210	$	(6,318	)
Non-compete contracts		430		(391	)		430		(388	)
Trade name		520		(350	)		520		(320	)
Core deposit intangible		6,979		(4,946	)		6,979		(4,271	)
Total	$	15,139	$	(12,244	)	$	15,139	$	(11,297	)

Estimated Amortization Expense

Estimated amortization expense for each of the next five periods and thereafter:

2021 (3 months)	$	318
2022		1,090
2023		617
2024		314
2025		253
Thereafter		303
Total	$	2,895

XML

Leases (Tables)

9 Months Ended

Sep. 30, 2021

Leases [Abstract]

Maturities of Lease Liabilities

Maturities of lease liabilities are as follows as of September 30, 2021:

2021 (3 months)	$	201
2022		647
2023		592
2024		417
2025		424
Thereafter		3,240
Total Payments		5,521
Less: Imputed Interest		(834	)
Total	$	4,687

XML

Interest-Rate Swaps (Tables)

9 Months Ended

Sep. 30, 2021

Derivative Instruments And Hedging Activities Disclosure [Abstract]

Summary Information about Interest-Rate Swaps

Summary information about these interest-rate swaps at periods ended September 30, 2021 and December 31, 2020 is as follows:

	September 30, 2021			December 31, 2020
Notional amounts (In thousands)	$	48,985		$	41,315
Weighted average pay rate on interest-rate swaps		4.63	%		4.63	%
Weighted average receive rate on interest-rate swaps		2.27	%		2.36	%
Weighted average maturity (years)		3.9			4.3
Fair value of interest-rate swaps (In thousands)	$	(2,768	)	$	(4,221	)
Fair value of loan yield maintenance provisions (In thousands)	$	2,768		$	4,221

XML

Earnings Per Share (Tables)

9 Months Ended

Sep. 30, 2021

Earnings Per Share [Abstract]

Computation of Basic and Diluted Earnings Per Share

The computation of basic and diluted earnings per share is shown in the following table:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2021		2020		2021		2020
Basic EPS
Net income (In thousands)	$	16,011	$	10,869	$	46,142	$	30,519
Weighted average shares outstanding		28,246,206		28,182,744		28,235,732		28,293,445
Basic earnings per share	$	0.57	$	0.39	$	1.63	$	1.08
Diluted EPS
Net income (In thousands)	$	16,011	$	10,869	$	46,142	$	30,519
Weighted average shares outstanding for basic earnings per share		28,246,206		28,182,744		28,235,732		28,293,445
Dilutive effect of restricted stock awards		114,355		107,778		102,813		127,779
Weighted average shares for diluted earnings per share		28,360,561		28,290,522		28,338,545		28,421,224
Diluted earnings per share	$	0.56	$	0.38	$	1.63	$	1.07

XML

Stock Based Compensation (Tables)

9 Months Ended

Sep. 30, 2021

Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]

Summary of Award Activity under Plans

The following is the activity under the Plans during the nine month period ended September 30, 2021.

	Nine Months Ended September 30, 2021
	Maximum Awarded Service Units			Weighted Average Grant Date Fair Value		Maximum Awarded Performance Units			Weighted Average Grant Date Fair Value
Beginning balance - non-vested shares		67,765		$	14.32		153,070		$	14.46
Granted		38,061			15.45		58,245			14.21
Vested		(26,621	)		14.41		(52,327	)		14.34
Forfeited		(4,758	)		14.15		0			0
Ending balance - non-vested shares		74,447		$	14.94		158,988		$	14.40

XML

Other Comprehensive Income (Loss) (Tables)

9 Months Ended

Sep. 30, 2021

Comprehensive Income Net Of Tax [Abstract]

Schedule of Other Comprehensive Income (Loss)

The following table represents the details of other comprehensive income for the three and nine month periods ended September 30, 2021 and 2020.

	Three Months Ended September 30, 2021
(In Thousands of Dollars)	Pre-tax			Tax			After-Tax
Unrealized holding gains (loss) on available-for-sale securities during the period	$	(2,754	)	$	578		$	(2,176	)
Reclassification adjustment for (gains) included in net income (1)		(464	)		96			(368	)
Net other comprehensive income	$	(3,218	)	$	674		$	(2,544	)
	Three Months Ended September 30, 2020
(In Thousands of Dollars)	Pre-tax			Tax			After-Tax
Unrealized holding gains on available-for-sale securities during the period	$	700		$	(147	)	$	553
Reclassification adjustment for (gains) included in net income (1)		(48	)		9			(39	)
Net other comprehensive income	$	652		$	(138	)	$	514
	Nine Months Ended September 30, 2021
(In Thousands of Dollars)	Pre-tax			Tax			After-Tax
Unrealized holding gains (loss) on available-for-sale securities during the period	$	(8,990	)	$	1,888		$	(7,102	)
Reclassification adjustment for (gains) included in net income (1)		(848	)		178			(670	)
Net other comprehensive income	$	(9,838	)	$	2,066		$	(7,772	)
	Nine Months Ended September 30, 2020
(In Thousands of Dollars)	Pre-tax			Tax			After-Tax
Unrealized holding gains on available-for-sale securities during the period	$	13,894		$	(2,918	)	$	10,976
Reclassification adjustment for (gains) losses included in net income (1)		(318	)		66			(252	)
Net other comprehensive income	$	13,576		$	(2,852	)	$	10,724

(1) Pre-tax reclassification adjustments relating to available-for-sale securities are reported in security gains and the tax impact is included in income tax expense on the consolidated statements of income.

XML

Regulatory Capital Matters (Tables)

9 Months Ended

Sep. 30, 2021

Regulatory Capital Requirements [Abstract]

Schedule of Actual and Required Capital Amounts and Ratios, Not Include Capital Conservation Buffer

Actual and required capital amounts and ratios, which do not include the capital conservation buffer, are presented below at September 30, 2021 and December 31, 2020:

	Actual					Requirement For Capital Adequacy Purposes:					To be Well Capitalized Under Prompt Corrective Action Provisions:
	Amount		Ratio			Amount		Ratio			Amount		Ratio
September 30, 2021
Common equity tier 1 capital ratio
Consolidated	$	315,850		14.55	%	$	97,715		4.5	%	N/A		N/A
Bank		265,224		12.23	%		97,606		4.5	%		140,986		6.5	%
Total risk based capital ratio
Consolidated		351,987		16.21	%		173,715		8.0	%	N/A		N/A
Bank		288,360		13.29	%		173,521		8.0	%		216,901		10.0	%
Tier 1 risk based capital ratio
Consolidated		328,850		15.14	%		130,286		6.0	%	N/A		N/A
Bank		265,224		12.23	%		130,141		6.0	%		173,521		8.0	%
Tier 1 leverage ratio
Consolidated		328,850		10.17	%		129,307		4.0	%	N/A		N/A
Bank		265,224		8.25	%		128,647		4.0	%		160,809		5.0	%
December 31, 2020
Common equity tier 1 capital ratio
Consolidated	$	279,864		13.22	%	$	95,211		4.5	%	N/A		N/A
Bank		268,041		12.71	%		94,903		4.5	%	$	137,083		6.5	%
Total risk based capital ratio
Consolidated		311,413		14.72	%		169,264		8.0	%	N/A		N/A
Bank		290,185		13.76	%		168,717		8.0	%		210,897		10.0	%
Tier 1 risk based capital ratio
Consolidated		289,269		13.67	%		126,948		6.0	%	N/A		N/A
Bank		268,041		12.71	%		126,538		6.0	%		168,717		8.0	%
Tier 1 leverage ratio
Consolidated		289,269		9.77	%		118,464		4.0	%	N/A		N/A
Bank		268,041		9.10	%		117,877		4.0	%		147,346		5.0	%

XML

Segment Information (Tables)

9 Months Ended

Sep. 30, 2021

Segment Reporting [Abstract]

Schedule of Segment Reporting Information

Significant segment totals are reconciled to the financial statements as follows:

(In Thousands of Dollars)	Trust Segment		Bank Segment		Eliminations and Others			Consolidated Totals
September 30, 2021
Goodwill and other intangibles	$	5,872	$	46,356	$	(3,558	)	$	48,670
Total assets	$	14,732	$	3,298,987	$	3,328		$	3,317,047

(In Thousands of Dollars)	Trust Segment		Bank Segment		Eliminations and Others			Consolidated Totals
December 31, 2020
Goodwill and other intangibles	$	6,046	$	47,129	$	(3,558	)	$	49,617
Total assets	$	15,147	$	3,055,628	$	373		$	3,071,148

(In Thousands of Dollars)	Trust Segment		Bank Segment			Eliminations and Others			Consolidated Totals
For Three Months Ended September 30, 2021
Net interest income	$	31	$	26,798		$	(295	)	$	26,534
Provision for credit losses and unfunded loans		0		(948	)		0			(948	)
Service fees, security gains and other noninterest income		2,707		6,385			(77	)		9,015
Noninterest expense		1,726		14,586			(12	)		16,300
Amortization and depreciation expense		67		653			108			828
Income before taxes		945		18,892			(468	)		19,369
Income taxes		198		3,310			(150	)		3,358
Net income	$	747	$	15,582		$	(318	)	$	16,011

(In Thousands of Dollars)	Trust Segment		Bank Segment			Eliminations and Others			Consolidated Totals
For Nine Months Ended September 30, 2021
Net interest income	$	94	$	78,597		$	(400	)	$	78,291
Provision for credit losses and unfunded loans		0		(473	)		0			(473	)
Service fees, security gains and other noninterest income		8,108		20,726			(128	)		28,706
Noninterest expense		4,818		44,727			(409	)		49,136
Amortization and depreciation expense		194		1,992			244			2,430
Income before taxes		3,190		53,077			(363	)		55,904
Income taxes		669		9,379			(286	)		9,762
Net income	$	2,521	$	43,698		$	(77	)	$	46,142

(In Thousands of Dollars)	Trust Segment		Bank Segment		Eliminations and Others			Consolidated Totals
For Three Months Ended September 30, 2020
Net interest income	$	31	$	24,197	$	(63	)	$	24,165
Provision for credit losses and unfunded loans		0		2,600		0			2,600
Service fees, security gains and other noninterest income		2,357		6,924		(64	)		9,217
Noninterest expense		1,507		15,112		63			16,682
Amortization and depreciation expense		88		632		68			788
Income before taxes		793		12,777		(258	)		13,312
Income taxes		166		2,397		(120	)		2,443
Net income	$	627	$	10,380	$	(138	)	$	10,869

(In Thousands of Dollars)	Trust Segment		Bank Segment		Eliminations and Others			Consolidated Totals
For Nine Months Ended September 30, 2020
Net interest income	$	95	$	70,540	$	(247	)	$	70,388
Provision for credit losses and unfunded loans		0		6,100		0			6,100
Service fees, security gains and other noninterest income		6,922		19,086		(346	)		25,662
Noninterest expense		4,549		45,886		634			51,069
Amortization and depreciation expense		228		1,905		184			2,317
Income before taxes		2,240		35,735		(1,411	)		36,564
Income taxes		470		6,051		(476	)		6,045
Net income	$	1,770	$	29,684	$	(935	)	$	30,519

XML

Summary of Significant Accounting Policies (Details Textual)	9 Months Ended
	Sep. 30, 2021 USD ($) Segment shares	Dec. 31, 2020 shares
Summary of Significant Accounting Policies (Additional Textual) [Abstract]
Operating segments of business | Segment	2
Common stock, shares authorized and available for issuance | shares	50,000,000	50,000,000
Common stock, shares outstanding | shares	28,321,581
Allowance for credit losses related to investment portfolio	$ 0
Liability for anticipated credit losses for unfunded commitments	437,000
Fees waived	$ 780,000
Percentage of decrease in net interest margin	0.08%
ASU 2016-13 | Minimum
Summary of Significant Accounting Policies (Additional Textual) [Abstract]
Increase in allowance for credit losses	$ 1,900,000
ASU 2016-13 | Maximum
Summary of Significant Accounting Policies (Additional Textual) [Abstract]
Increase in allowance for credit losses	$ 2,500,000

XML

Business Combinations (Details Textual) - USD ($) $ / shares in Units, $ in Thousands	Nov. 01, 2021	Jan. 07, 2020	Sep. 30, 2021	Jun. 30, 2021	Dec. 31, 2020	Sep. 30, 2020	Jun. 30, 2020	Dec. 31, 2019
Business Acquisition [Line Items]
Total assets			$ 3,317,047		$ 3,071,148
Deposits			2,866,413		2,610,878
Equity			377,524		350,097	$ 339,968
Goodwill			45,775		45,775
Cortland Bank
Business Acquisition [Line Items]
Total assets			799,200
Gross loans			500,000
Deposits			693,000
Equity			83,000
Cortland Bank | Subsequent Event [Member]
Business Acquisition [Line Items]
Business acquisition, date of merger agreement	Nov. 01, 2021
Maximum percentage of common shares exchanged for company's shares under merger agreement	75.00%
Percentage of common shares exchanged for company's cash under merger agreement	25.00%
Maple Leaf
Business Acquisition [Line Items]
Business acquisition, date of merger agreement		Jan. 07, 2020
Shares of stock issued for acquisition		1,398,229
Fair value of total consideration transferred		$ 42,977
Goodwill		$ 7,574
COMMON STOCK
Business Acquisition [Line Items]
Equity			$ 208,539	$ 208,312	$ 208,763	$ 208,644	$ 208,390	$ 186,345
COMMON STOCK | Cortland Bank | Subsequent Event [Member]
Business Acquisition [Line Items]
Cash consideration per share | $ / shares	$ 28.00
Shares of stock issued for acquisition	1.75
COMMON STOCK | Maple Leaf
Business Acquisition [Line Items]
Cash consideration per share | $ / shares		$ 640.00
Shares of stock issued for acquisition		45.5948
Exercise price of warrants		$ 370.00

XML

Business Combinations (Details) - USD ($) $ in Thousands	Jan. 07, 2020	Sep. 30, 2021	Dec. 31, 2020
Fair value of liabilities assumed
Goodwill created		$ 45,775	$ 45,775
Maple Leaf
Consideration
Cash	$ 20,423
Stock	22,554
Fair value of total consideration transferred	42,977
Fair value of assets acquired
Cash and due from financial institutions	18,219
Securities available for sale	69,547
Loans	181,280
Premises and equipment	229
Core deposit intangible	725
Other assets	6,398
Total assets	276,398
Fair value of liabilities assumed
Deposits	183,251
Long-term borrowings	54,487
Accrued interest payable and other liabilities	3,257
Total liabilities	240,995
Net assets acquired	35,403
Goodwill created	7,574
Total net assets acquired	$ 42,977

XML

Business Combinations (Details 1) $ / shares in Units, $ in Thousands	9 Months Ended
	Sep. 30, 2020 USD ($) $ / shares
Business Combinations [Abstract]
Net interest income | $	$ 70,568
Net income | $	$ 30,539
Basic earnings per share | $ / shares	$ 1.08
Diluted earnings per share | $ / shares	$ 1.07

XML

Securities (Details) - USD ($) $ in Thousands	Sep. 30, 2021	Dec. 31, 2020
Schedule Of Available For Sale Securities [Line Items]
Amortized Cost	$ 1,165,310	$ 547,711
Gross Unrealized Gains	26,099	28,395
Gross Unrealized Losses	(8,048)	(506)
Fair Value	1,183,361	575,600
U.S. Treasury and U.S. government sponsored entities
Schedule Of Available For Sale Securities [Line Items]
Amortized Cost	89,919	11,798
Gross Unrealized Gains	53	101
Gross Unrealized Losses	(1,502)	(54)
Fair Value	88,470	11,845
State and political subdivisions
Schedule Of Available For Sale Securities [Line Items]
Amortized Cost	485,125	344,160
Gross Unrealized Gains	22,776	22,350
Gross Unrealized Losses	(618)	(204)
Fair Value	507,283	366,306
Mortgage-backed securities - residential
Schedule Of Available For Sale Securities [Line Items]
Amortized Cost	569,235	157,106
Gross Unrealized Gains	2,778	4,919
Gross Unrealized Losses	(5,909)	(243)
Fair Value	566,104	161,782
Collateralized mortgage obligations - residential
Schedule Of Available For Sale Securities [Line Items]
Amortized Cost	12,956	25,654
Gross Unrealized Gains	290	742
Gross Unrealized Losses	(5)	(3)
Fair Value	13,241	26,393
Corporate bonds
Schedule Of Available For Sale Securities [Line Items]
Amortized Cost	3,604	3,582
Gross Unrealized Gains	77	132
Gross Unrealized Losses	(14)	(2)
Fair Value	3,667	3,712
Small Business Administration
Schedule Of Available For Sale Securities [Line Items]
Amortized Cost	4,471	5,411
Gross Unrealized Gains	125	151
Gross Unrealized Losses	0	0
Fair Value	$ 4,596	$ 5,562

XML

Securities (Details Textual)	3 Months Ended		9 Months Ended
	Sep. 30, 2021 USD ($) Securities	Sep. 30, 2020 USD ($)	Sep. 30, 2021 USD ($) Securities	Sep. 30, 2020 USD ($)
Schedule Of Available For Sale Securities [Line Items]
Proceeds from the sale of portfolio securities	$ 8,200,000	$ 2,300,000	$ 35,200,000	$ 17,700,000
Gross gains realized	458,000	48,000	1,400,000	330,000
Gross losses realized	$ 1,000	0	$ 515,000	12,000
Number of securities | Securities	718		718
Number of securities on unrealized loss position | Securities	146		146
Allowance for credit losses on available-for-sale securities	$ 0		$ 0
ASU 2016-01 | Equity securities
Schedule Of Available For Sale Securities [Line Items]
Realized gains recognized in income statement for securities	$ 5,000		$ 141,000
Realized losses recognized in income statement for securities		$ 22,000		$ 117,000

XML

Securities (Details 1) - USD ($) $ in Thousands	Sep. 30, 2021	Dec. 31, 2020
Amortized cost and fair value of the debt securities maturity
Amortized Cost, Within one year	$ 3,791
Amortized Cost, One to five years	10,360
Amortized Cost, Five to ten years	125,179
Amortized Cost, Beyond ten years	439,318
Amortized Cost, Mortgage-backed, collateralized mortgage obligations and Small Business Administration securities	586,662
Amortized Cost	1,165,310	$ 547,711
Fair Value, Within one year	3,820
Fair Value, One to five years	10,967
Fair Value, Five to ten years	125,944
Fair Value, Beyond ten years	458,689
Fair Value, Mortgage-backed, collateralized mortgage obligations and Small Business Administration securities	583,941
Fair Value, Total	$ 1,183,361	$ 575,600

XML

Securities (Details 2) - USD ($) $ in Thousands	Sep. 30, 2021	Dec. 31, 2020
Investment securities with unrealized losses
Fair Value, Less Than 12 Months	$ 542,026	$ 91,251
Unrealized Losses, Less Than 12 Months	(7,963)	(506)
Fair Value, 12 Months or Longer	5,662	0
Unrealized Losses, 12 Months or Longer	(85)	0
Fair Value, Total	547,688	91,251
Unrealized Losses, Total	(8,048)	(506)
U.S. Treasury and U.S. government sponsored entities
Investment securities with unrealized losses
Fair Value, Less Than 12 Months	84,849	8,153
Unrealized Losses, Less Than 12 Months	(1,479)	(54)
Fair Value, 12 Months or Longer	627	0
Unrealized Losses, 12 Months or Longer	(23)	0
Fair Value, Total	85,476	8,153
Unrealized Losses, Total	(1,502)	(54)
State and political subdivisions
Investment securities with unrealized losses
Fair Value, Less Than 12 Months	64,442	19,205
Unrealized Losses, Less Than 12 Months	(562)	(204)
Fair Value, 12 Months or Longer	4,579	0
Unrealized Losses, 12 Months or Longer	(56)	0
Fair Value, Total	69,021	19,205
Unrealized Losses, Total	(618)	(204)
Mortgage-backed securities - residential
Investment securities with unrealized losses
Fair Value, Less Than 12 Months	390,783	63,401
Unrealized Losses, Less Than 12 Months	(5,909)	(243)
Fair Value, 12 Months or Longer	10	0
Unrealized Losses, 12 Months or Longer	0	0
Fair Value, Total	390,793	63,401
Unrealized Losses, Total	(5,909)	(243)
Collateralized mortgage obligations - residential
Investment securities with unrealized losses
Fair Value, Less Than 12 Months	1,419	294
Unrealized Losses, Less Than 12 Months	(2)	(3)
Fair Value, 12 Months or Longer	249	0
Unrealized Losses, 12 Months or Longer	(3)	0
Fair Value, Total	1,668	294
Unrealized Losses, Total	(5)	(3)
Corporate bonds
Investment securities with unrealized losses
Fair Value, Less Than 12 Months	533	198
Unrealized Losses, Less Than 12 Months	(11)	(2)
Fair Value, 12 Months or Longer	197	0
Unrealized Losses, 12 Months or Longer	(3)	0
Fair Value, Total	730	198
Unrealized Losses, Total	$ (14)	$ (2)

XML

Loans (Details) - USD ($) $ in Thousands	Sep. 30, 2021	Jun. 30, 2021	Dec. 31, 2020	Sep. 30, 2020	Jun. 30, 2020	Dec. 31, 2019
Schedule of loan balances
Total loans	$ 1,871,080		$ 2,055,900
Allowance for credit losses	(23,136)	$ (24,806)	(22,144)	$ (19,341)	$ (16,960)	$ (14,487)
Commercial real estate
Schedule of loan balances
Allowance for credit losses	(11,561)	(12,290)	(10,824)	(9,006)	(7,972)	(6,156)
Commercial
Schedule of loan balances
Allowance for credit losses	(3,730)	(4,600)	(5,073)	(4,292)	(3,293)	(2,447)
Residential real estate
Schedule of loan balances
Allowance for credit losses	(4,118)	(4,130)	(3,643)	(3,397)	(2,991)	(3,029)
Consumer
Schedule of loan balances
Allowance for credit losses	(3,727)	$ (3,786)	(2,604)	$ (2,646)	$ (2,704)	$ (2,855)
Originated Loans
Schedule of loan balances
Total loans	1,892,807		1,805,661
Originated Loans | Commercial real estate, Owner occupied | Commercial real estate
Schedule of loan balances
Loan balances	260,556		215,187
Originated Loans | Commercial real estate, Non-owner occupied | Commercial real estate
Schedule of loan balances
Loan balances	351,407		309,777
Originated Loans | Commercial real estate, Farmland | Commercial real estate
Schedule of loan balances
Loan balances	176,190		156,277
Originated Loans | Commercial real estate, Other | Commercial real estate
Schedule of loan balances
Loan balances	78,444		78,140
Originated Loans | Commercial, Commercial and industrial | Commercial
Schedule of loan balances
Loan balances	302,356		385,831
Originated Loans | Commercial, Agricultural | Commercial
Schedule of loan balances
Loan balances	50,707		44,922
Originated Loans | Residential real estate, 1-4 family residential | Residential real estate
Schedule of loan balances
Loan balances	376,901		324,723
Originated Loans | Residential real estate, Home equity lines of credit | Residential real estate
Schedule of loan balances
Loan balances	106,750		92,968
Originated Loans | Consumer, Indirect | Consumer
Schedule of loan balances
Loan balances	158,617		164,620
Originated Loans | Consumer, Direct | Consumer
Schedule of loan balances
Loan balances	21,520		23,348
Originated Loans | Consumer, Other | Consumer
Schedule of loan balances
Loan balances	9,359		9,868
Acquired Loans
Schedule of loan balances
Total loans	0		272,150
Net Deferred loan (fees) costs	1,409		233
Acquired Loans | Commercial real estate, Owner occupied | Commercial real estate
Schedule of loan balances
Loan balances	0		45,101
Acquired Loans | Commercial real estate, Non-owner occupied | Commercial real estate
Schedule of loan balances
Loan balances	0		52,863
Acquired Loans | Commercial real estate, Farmland | Commercial real estate
Schedule of loan balances
Loan balances	0		26,080
Acquired Loans | Commercial real estate, Other | Commercial real estate
Schedule of loan balances
Loan balances	0		12,868
Acquired Loans | Commercial, Commercial and industrial | Commercial
Schedule of loan balances
Loan balances	0		18,662
Acquired Loans | Commercial, Agricultural | Commercial
Schedule of loan balances
Loan balances	0		4,850
Acquired Loans | Residential real estate, 1-4 family residential | Residential real estate
Schedule of loan balances
Loan balances	0		89,118
Acquired Loans | Residential real estate, Home equity lines of credit | Residential real estate
Schedule of loan balances
Loan balances	0		17,383
Acquired Loans | Consumer, Direct | Consumer
Schedule of loan balances
Loan balances	0		5,128
Acquired Loans | Consumer, Other | Consumer
Schedule of loan balances
Loan balances	$ 0		$ 97

XML

Loans (Details 1) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Financing Receivable Allowance For Credit Losses [Line Items]
Beginning balance	$ 24,806	$ 16,960	$ 22,144	$ 14,487
Impact of CECL adoption			2,450
Adjustment related to reserve for unfunded loan reclass	(437)		(437)
Provision for credit losses	(947)	2,600	(472)	6,100
Loans charged off	(411)	(393)	(1,197)	(1,666)
Recoveries	125	174	648	420
Ending balance	23,136	19,341	23,136	19,341
Commercial real estate
Financing Receivable Allowance For Credit Losses [Line Items]
Beginning balance	12,290	7,972	10,824	6,156
Impact of CECL adoption			(2,076)
Adjustment related to reserve for unfunded loan reclass	(245)		(245)
Provision for credit losses	(454)	1,052	3,077	2,961
Loans charged off	(31)	(20)	(51)	(117)
Recoveries	1	2	32	6
Ending balance	11,561	9,006	11,561	9,006
Commercial
Financing Receivable Allowance For Credit Losses [Line Items]
Beginning balance	4,600	3,293	5,073	2,447
Impact of CECL adoption			429
Adjustment related to reserve for unfunded loan reclass	(104)		(104)
Provision for credit losses	(655)	1,090	(1,668)	2,176
Loans charged off	(126)	(92)	(198)	(340)
Recoveries	15	1	198	9
Ending balance	3,730	4,292	3,730	4,292
Residential real estate
Financing Receivable Allowance For Credit Losses [Line Items]
Beginning balance	4,130	2,991	3,643	3,029
Impact of CECL adoption			237
Adjustment related to reserve for unfunded loan reclass	(73)		(73)
Provision for credit losses	75	414	411	490
Loans charged off	(55)	(22)	(221)	(163)
Recoveries	41	14	121	41
Ending balance	4,118	3,397	4,118	3,397
Consumer
Financing Receivable Allowance For Credit Losses [Line Items]
Beginning balance	3,786	2,704	2,604	2,855
Impact of CECL adoption			3,860
Adjustment related to reserve for unfunded loan reclass	(15)		(15)
Provision for credit losses	87	44	(2,292)	473
Loans charged off	(199)	(259)	(727)	(1,046)
Recoveries	68	157	297	364
Ending balance	$ 3,727	$ 2,646	$ 3,727	$ 2,646

XML

Loans (Details 2) - USD ($) $ in Thousands	Sep. 30, 2021	Dec. 31, 2020
Financing Receivable Recorded Investment Past Due [Line Items]
Nonaccrual	$ 13,968	$ 11,505
Loans Past Due 90 Days or More Still Accruing	776	2,330
Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Nonaccrual	13,968	5,792
Loans Past Due 90 Days or More Still Accruing	776	760
Originated Loans | Commercial real estate, Owner occupied | Commercial real estate
Financing Receivable Recorded Investment Past Due [Line Items]
Nonaccrual	452	0
Loans Past Due 90 Days or More Still Accruing	0	335
Originated Loans | Commercial real estate, Non-owner occupied | Commercial real estate
Financing Receivable Recorded Investment Past Due [Line Items]
Nonaccrual	2,627	0
Loans Past Due 90 Days or More Still Accruing	0	0
Originated Loans | Commercial real estate, Farmland | Commercial real estate
Financing Receivable Recorded Investment Past Due [Line Items]
Nonaccrual	277	0
Loans Past Due 90 Days or More Still Accruing	0	0
Originated Loans | Commercial, Commercial and industrial | Commercial
Financing Receivable Recorded Investment Past Due [Line Items]
Nonaccrual	5,177	3,312
Loans Past Due 90 Days or More Still Accruing	3	22
Originated Loans | Commercial, Agricultural | Commercial
Financing Receivable Recorded Investment Past Due [Line Items]
Nonaccrual	34	205
Loans Past Due 90 Days or More Still Accruing	0	0
Originated Loans | Residential real estate, 1-4 family residential | Residential real estate
Financing Receivable Recorded Investment Past Due [Line Items]
Nonaccrual	3,960	866
Loans Past Due 90 Days or More Still Accruing	466	223
Originated Loans | Residential real estate, Home equity lines of credit | Residential real estate
Financing Receivable Recorded Investment Past Due [Line Items]
Nonaccrual	718	603
Loans Past Due 90 Days or More Still Accruing	137	0
Originated Loans | Consumer, Indirect | Consumer
Financing Receivable Recorded Investment Past Due [Line Items]
Nonaccrual	462	648
Loans Past Due 90 Days or More Still Accruing	101	64
Originated Loans | Consumer, Direct | Consumer
Financing Receivable Recorded Investment Past Due [Line Items]
Nonaccrual	261	157
Loans Past Due 90 Days or More Still Accruing	69	111
Originated Loans | Consumer, Other | Consumer
Financing Receivable Recorded Investment Past Due [Line Items]
Nonaccrual	0	1
Loans Past Due 90 Days or More Still Accruing	0	5
Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Nonaccrual	0	5,713
Loans Past Due 90 Days or More Still Accruing	0	1,570
Acquired Loans | Commercial real estate, Owner occupied | Commercial real estate
Financing Receivable Recorded Investment Past Due [Line Items]
Nonaccrual	0	27
Loans Past Due 90 Days or More Still Accruing	0	0
Acquired Loans | Commercial real estate, Non-owner occupied | Commercial real estate
Financing Receivable Recorded Investment Past Due [Line Items]
Nonaccrual	0	362
Loans Past Due 90 Days or More Still Accruing	0	0
Acquired Loans | Commercial real estate, Farmland | Commercial real estate
Financing Receivable Recorded Investment Past Due [Line Items]
Nonaccrual	0	471
Loans Past Due 90 Days or More Still Accruing	0	95
Acquired Loans | Commercial, Commercial and industrial | Commercial
Financing Receivable Recorded Investment Past Due [Line Items]
Nonaccrual	0	477
Loans Past Due 90 Days or More Still Accruing	0	0
Acquired Loans | Commercial, Agricultural | Commercial
Financing Receivable Recorded Investment Past Due [Line Items]
Nonaccrual	0	4
Loans Past Due 90 Days or More Still Accruing	0	0
Acquired Loans | Residential real estate, 1-4 family residential | Residential real estate
Financing Receivable Recorded Investment Past Due [Line Items]
Nonaccrual	0	4,128
Loans Past Due 90 Days or More Still Accruing	0	1,469
Acquired Loans | Residential real estate, Home equity lines of credit | Residential real estate
Financing Receivable Recorded Investment Past Due [Line Items]
Nonaccrual	0	186
Loans Past Due 90 Days or More Still Accruing	0	0
Acquired Loans | Consumer, Direct | Consumer
Financing Receivable Recorded Investment Past Due [Line Items]
Nonaccrual	0	58
Loans Past Due 90 Days or More Still Accruing	$ 0	$ 6

XML

Loans (Details 3) - USD ($) $ in Thousands	Sep. 30, 2021	Dec. 31, 2020
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	$ 1,894,216	$ 2,078,044
Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		1,805,911
Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		272,133
Financing Receivables, 30 to 59 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	5,561	6,320
Financing Receivables, 30 to 59 Days Past Due | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		4,103
Financing Receivables, 30 to 59 Days Past Due | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		2,217
Financing Receivables, 60 to 89 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	1,383	2,977
Financing Receivables, 60 to 89 Days Past Due | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		1,717
Financing Receivables, 60 to 89 Days Past Due | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		1,260
Financing Receivables, Equal to Greater than 90 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	14,744	13,835
Financing Receivables, Equal to Greater than 90 Days Past Due | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		6,552
Financing Receivables, Equal to Greater than 90 Days Past Due | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		7,283
Financing Receivables, Total Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	21,688	23,132
Financing Receivables, Total Past Due | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		12,372
Financing Receivables, Total Past Due | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		10,760
Loans Not Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	1,872,528	2,054,912
Loans Not Past Due | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		1,793,539
Loans Not Past Due | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		261,373
Commercial real estate
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	689,291
Commercial
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	300,084
Residential real estate
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	376,003
Consumer
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	195,264
Commercial real estate, Owner occupied | Commercial real estate
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	260,180
Commercial real estate, Owner occupied | Commercial real estate | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		214,795
Commercial real estate, Owner occupied | Commercial real estate | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		45,099
Commercial real estate, Owner occupied | Commercial real estate | Financing Receivables, 30 to 59 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	72
Commercial real estate, Owner occupied | Commercial real estate | Financing Receivables, 30 to 59 Days Past Due | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		0
Commercial real estate, Owner occupied | Commercial real estate | Financing Receivables, 30 to 59 Days Past Due | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		0
Commercial real estate, Owner occupied | Commercial real estate | Financing Receivables, 60 to 89 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	0
Commercial real estate, Owner occupied | Commercial real estate | Financing Receivables, 60 to 89 Days Past Due | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		0
Commercial real estate, Owner occupied | Commercial real estate | Financing Receivables, 60 to 89 Days Past Due | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		0
Commercial real estate, Owner occupied | Commercial real estate | Financing Receivables, Equal to Greater than 90 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	452
Commercial real estate, Owner occupied | Commercial real estate | Financing Receivables, Equal to Greater than 90 Days Past Due | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		335
Commercial real estate, Owner occupied | Commercial real estate | Financing Receivables, Equal to Greater than 90 Days Past Due | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		27
Commercial real estate, Owner occupied | Commercial real estate | Financing Receivables, Total Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	524
Commercial real estate, Owner occupied | Commercial real estate | Financing Receivables, Total Past Due | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		335
Commercial real estate, Owner occupied | Commercial real estate | Financing Receivables, Total Past Due | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		27
Commercial real estate, Owner occupied | Commercial real estate | Loans Not Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	259,656
Commercial real estate, Owner occupied | Commercial real estate | Loans Not Past Due | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		214,460
Commercial real estate, Owner occupied | Commercial real estate | Loans Not Past Due | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		45,072
Commercial real estate, Non-owner occupied | Commercial real estate
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	350,894
Commercial real estate, Non-owner occupied | Commercial real estate | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		309,216
Commercial real estate, Non-owner occupied | Commercial real estate | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		52,854
Commercial real estate, Non-owner occupied | Commercial real estate | Financing Receivables, 30 to 59 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	0
Commercial real estate, Non-owner occupied | Commercial real estate | Financing Receivables, 30 to 59 Days Past Due | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		0
Commercial real estate, Non-owner occupied | Commercial real estate | Financing Receivables, 30 to 59 Days Past Due | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		197
Commercial real estate, Non-owner occupied | Commercial real estate | Financing Receivables, 60 to 89 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	0
Commercial real estate, Non-owner occupied | Commercial real estate | Financing Receivables, 60 to 89 Days Past Due | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		0
Commercial real estate, Non-owner occupied | Commercial real estate | Financing Receivables, 60 to 89 Days Past Due | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		0
Commercial real estate, Non-owner occupied | Commercial real estate | Financing Receivables, Equal to Greater than 90 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	2,627
Commercial real estate, Non-owner occupied | Commercial real estate | Financing Receivables, Equal to Greater than 90 Days Past Due | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		0
Commercial real estate, Non-owner occupied | Commercial real estate | Financing Receivables, Equal to Greater than 90 Days Past Due | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		362
Commercial real estate, Non-owner occupied | Commercial real estate | Financing Receivables, Total Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	2,627
Commercial real estate, Non-owner occupied | Commercial real estate | Financing Receivables, Total Past Due | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		0
Commercial real estate, Non-owner occupied | Commercial real estate | Financing Receivables, Total Past Due | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		559
Commercial real estate, Non-owner occupied | Commercial real estate | Loans Not Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	348,267
Commercial real estate, Non-owner occupied | Commercial real estate | Loans Not Past Due | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		309,216
Commercial real estate, Non-owner occupied | Commercial real estate | Loans Not Past Due | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		52,295
Commercial real estate, Farmland | Commercial real estate
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	175,930
Commercial real estate, Farmland | Commercial real estate | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		156,053
Commercial real estate, Farmland | Commercial real estate | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		26,079
Commercial real estate, Farmland | Commercial real estate | Financing Receivables, 30 to 59 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	356
Commercial real estate, Farmland | Commercial real estate | Financing Receivables, 30 to 59 Days Past Due | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		0
Commercial real estate, Farmland | Commercial real estate | Financing Receivables, 30 to 59 Days Past Due | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		0
Commercial real estate, Farmland | Commercial real estate | Financing Receivables, 60 to 89 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	0
Commercial real estate, Farmland | Commercial real estate | Financing Receivables, 60 to 89 Days Past Due | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		0
Commercial real estate, Farmland | Commercial real estate | Financing Receivables, 60 to 89 Days Past Due | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		0
Commercial real estate, Farmland | Commercial real estate | Financing Receivables, Equal to Greater than 90 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	277
Commercial real estate, Farmland | Commercial real estate | Financing Receivables, Equal to Greater than 90 Days Past Due | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		0
Commercial real estate, Farmland | Commercial real estate | Financing Receivables, Equal to Greater than 90 Days Past Due | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		566
Commercial real estate, Farmland | Commercial real estate | Financing Receivables, Total Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	633
Commercial real estate, Farmland | Commercial real estate | Financing Receivables, Total Past Due | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		0
Commercial real estate, Farmland | Commercial real estate | Financing Receivables, Total Past Due | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		566
Commercial real estate, Farmland | Commercial real estate | Loans Not Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	175,297
Commercial real estate, Farmland | Commercial real estate | Loans Not Past Due | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		156,053
Commercial real estate, Farmland | Commercial real estate | Loans Not Past Due | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		25,513
Commercial real estate, Other | Commercial real estate
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	78,217
Commercial real estate, Other | Commercial real estate | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		77,986
Commercial real estate, Other | Commercial real estate | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		12,868
Commercial real estate, Other | Commercial real estate | Financing Receivables, 30 to 59 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	0
Commercial real estate, Other | Commercial real estate | Financing Receivables, 30 to 59 Days Past Due | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		261
Commercial real estate, Other | Commercial real estate | Financing Receivables, 30 to 59 Days Past Due | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		0
Commercial real estate, Other | Commercial real estate | Financing Receivables, 60 to 89 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	0
Commercial real estate, Other | Commercial real estate | Financing Receivables, 60 to 89 Days Past Due | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		0
Commercial real estate, Other | Commercial real estate | Financing Receivables, 60 to 89 Days Past Due | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		0
Commercial real estate, Other | Commercial real estate | Financing Receivables, Equal to Greater than 90 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	0
Commercial real estate, Other | Commercial real estate | Financing Receivables, Equal to Greater than 90 Days Past Due | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		0
Commercial real estate, Other | Commercial real estate | Financing Receivables, Equal to Greater than 90 Days Past Due | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		0
Commercial real estate, Other | Commercial real estate | Financing Receivables, Total Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	0
Commercial real estate, Other | Commercial real estate | Financing Receivables, Total Past Due | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		261
Commercial real estate, Other | Commercial real estate | Financing Receivables, Total Past Due | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		0
Commercial real estate, Other | Commercial real estate | Loans Not Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	78,217
Commercial real estate, Other | Commercial real estate | Loans Not Past Due | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		77,725
Commercial real estate, Other | Commercial real estate | Loans Not Past Due | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		12,868
Commercial, Commercial and industrial | Commercial
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	300,084
Commercial, Commercial and industrial | Commercial | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		382,345
Commercial, Commercial and industrial | Commercial | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		18,658
Commercial, Commercial and industrial | Commercial | Financing Receivables, 30 to 59 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	112
Commercial, Commercial and industrial | Commercial | Financing Receivables, 30 to 59 Days Past Due | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		356
Commercial, Commercial and industrial | Commercial | Financing Receivables, 30 to 59 Days Past Due | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		19
Commercial, Commercial and industrial | Commercial | Financing Receivables, 60 to 89 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	358
Commercial, Commercial and industrial | Commercial | Financing Receivables, 60 to 89 Days Past Due | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		61
Commercial, Commercial and industrial | Commercial | Financing Receivables, 60 to 89 Days Past Due | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		390
Commercial, Commercial and industrial | Commercial | Financing Receivables, Equal to Greater than 90 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	5,180
Commercial, Commercial and industrial | Commercial | Financing Receivables, Equal to Greater than 90 Days Past Due | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		3,334
Commercial, Commercial and industrial | Commercial | Financing Receivables, Equal to Greater than 90 Days Past Due | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		477
Commercial, Commercial and industrial | Commercial | Financing Receivables, Total Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	5,650
Commercial, Commercial and industrial | Commercial | Financing Receivables, Total Past Due | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		3,751
Commercial, Commercial and industrial | Commercial | Financing Receivables, Total Past Due | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		886
Commercial, Commercial and industrial | Commercial | Loans Not Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	294,434
Commercial, Commercial and industrial | Commercial | Loans Not Past Due | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		378,594
Commercial, Commercial and industrial | Commercial | Loans Not Past Due | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		17,772
Commercial, Agricultural | Commercial
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	50,886
Commercial, Agricultural | Commercial | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		45,060
Commercial, Agricultural | Commercial | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		4,849
Commercial, Agricultural | Commercial | Financing Receivables, 30 to 59 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	87
Commercial, Agricultural | Commercial | Financing Receivables, 30 to 59 Days Past Due | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		45
Commercial, Agricultural | Commercial | Financing Receivables, 30 to 59 Days Past Due | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		4
Commercial, Agricultural | Commercial | Financing Receivables, 60 to 89 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	9
Commercial, Agricultural | Commercial | Financing Receivables, 60 to 89 Days Past Due | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		255
Commercial, Agricultural | Commercial | Financing Receivables, 60 to 89 Days Past Due | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		0
Commercial, Agricultural | Commercial | Financing Receivables, Equal to Greater than 90 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	34
Commercial, Agricultural | Commercial | Financing Receivables, Equal to Greater than 90 Days Past Due | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		205
Commercial, Agricultural | Commercial | Financing Receivables, Equal to Greater than 90 Days Past Due | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		4
Commercial, Agricultural | Commercial | Financing Receivables, Total Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	130
Commercial, Agricultural | Commercial | Financing Receivables, Total Past Due | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		505
Commercial, Agricultural | Commercial | Financing Receivables, Total Past Due | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		8
Commercial, Agricultural | Commercial | Loans Not Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	50,756
Commercial, Agricultural | Commercial | Loans Not Past Due | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		44,555
Commercial, Agricultural | Commercial | Loans Not Past Due | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		4,841
Residential real estate, 1-4 family residential | Residential real estate
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	376,003
Residential real estate, 1-4 family residential | Residential real estate | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		323,860
Residential real estate, 1-4 family residential | Residential real estate | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		89,117
Residential real estate, 1-4 family residential | Residential real estate | Financing Receivables, 30 to 59 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	3,399
Residential real estate, 1-4 family residential | Residential real estate | Financing Receivables, 30 to 59 Days Past Due | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		1,668
Residential real estate, 1-4 family residential | Residential real estate | Financing Receivables, 30 to 59 Days Past Due | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		1,954
Residential real estate, 1-4 family residential | Residential real estate | Financing Receivables, 60 to 89 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	845
Residential real estate, 1-4 family residential | Residential real estate | Financing Receivables, 60 to 89 Days Past Due | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		974
Residential real estate, 1-4 family residential | Residential real estate | Financing Receivables, 60 to 89 Days Past Due | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		821
Residential real estate, 1-4 family residential | Residential real estate | Financing Receivables, Equal to Greater than 90 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	4,426
Residential real estate, 1-4 family residential | Residential real estate | Financing Receivables, Equal to Greater than 90 Days Past Due | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		1,089
Residential real estate, 1-4 family residential | Residential real estate | Financing Receivables, Equal to Greater than 90 Days Past Due | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		5,597
Residential real estate, 1-4 family residential | Residential real estate | Financing Receivables, Total Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	8,670
Residential real estate, 1-4 family residential | Residential real estate | Financing Receivables, Total Past Due | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		3,731
Residential real estate, 1-4 family residential | Residential real estate | Financing Receivables, Total Past Due | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		8,372
Residential real estate, 1-4 family residential | Residential real estate | Loans Not Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	367,333
Residential real estate, 1-4 family residential | Residential real estate | Loans Not Past Due | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		320,129
Residential real estate, 1-4 family residential | Residential real estate | Loans Not Past Due | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		80,745
Residential real estate, Home equity lines of credit | Residential real estate
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	106,758
Residential real estate, Home equity lines of credit | Residential real estate | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		92,979
Residential real estate, Home equity lines of credit | Residential real estate | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		17,384
Residential real estate, Home equity lines of credit | Residential real estate | Financing Receivables, 30 to 59 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	253
Residential real estate, Home equity lines of credit | Residential real estate | Financing Receivables, 30 to 59 Days Past Due | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		419
Residential real estate, Home equity lines of credit | Residential real estate | Financing Receivables, 30 to 59 Days Past Due | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		23
Residential real estate, Home equity lines of credit | Residential real estate | Financing Receivables, 60 to 89 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	28
Residential real estate, Home equity lines of credit | Residential real estate | Financing Receivables, 60 to 89 Days Past Due | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		0
Residential real estate, Home equity lines of credit | Residential real estate | Financing Receivables, 60 to 89 Days Past Due | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		0
Residential real estate, Home equity lines of credit | Residential real estate | Financing Receivables, Equal to Greater than 90 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	855
Residential real estate, Home equity lines of credit | Residential real estate | Financing Receivables, Equal to Greater than 90 Days Past Due | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		603
Residential real estate, Home equity lines of credit | Residential real estate | Financing Receivables, Equal to Greater than 90 Days Past Due | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		186
Residential real estate, Home equity lines of credit | Residential real estate | Financing Receivables, Total Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	1,136
Residential real estate, Home equity lines of credit | Residential real estate | Financing Receivables, Total Past Due | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		1,022
Residential real estate, Home equity lines of credit | Residential real estate | Financing Receivables, Total Past Due | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		209
Residential real estate, Home equity lines of credit | Residential real estate | Loans Not Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	105,622
Residential real estate, Home equity lines of credit | Residential real estate | Loans Not Past Due | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		91,957
Residential real estate, Home equity lines of credit | Residential real estate | Loans Not Past Due | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		17,175
Consumer, Indirect | Consumer
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	164,306
Consumer, Indirect | Consumer | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		170,288
Consumer, Indirect | Consumer | Financing Receivables, 30 to 59 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	874
Consumer, Indirect | Consumer | Financing Receivables, 30 to 59 Days Past Due | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		1,046
Consumer, Indirect | Consumer | Financing Receivables, 60 to 89 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	57
Consumer, Indirect | Consumer | Financing Receivables, 60 to 89 Days Past Due | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		285
Consumer, Indirect | Consumer | Financing Receivables, Equal to Greater than 90 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	563
Consumer, Indirect | Consumer | Financing Receivables, Equal to Greater than 90 Days Past Due | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		712
Consumer, Indirect | Consumer | Financing Receivables, Total Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	1,494
Consumer, Indirect | Consumer | Financing Receivables, Total Past Due | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		2,043
Consumer, Indirect | Consumer | Loans Not Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	162,812
Consumer, Indirect | Consumer | Loans Not Past Due | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		168,245
Consumer, Direct | Consumer
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	21,599
Consumer, Direct | Consumer | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		23,461
Consumer, Direct | Consumer | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		5,128
Consumer, Direct | Consumer | Financing Receivables, 30 to 59 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	375
Consumer, Direct | Consumer | Financing Receivables, 30 to 59 Days Past Due | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		284
Consumer, Direct | Consumer | Financing Receivables, 30 to 59 Days Past Due | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		20
Consumer, Direct | Consumer | Financing Receivables, 60 to 89 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	78
Consumer, Direct | Consumer | Financing Receivables, 60 to 89 Days Past Due | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		120
Consumer, Direct | Consumer | Financing Receivables, 60 to 89 Days Past Due | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		49
Consumer, Direct | Consumer | Financing Receivables, Equal to Greater than 90 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	330
Consumer, Direct | Consumer | Financing Receivables, Equal to Greater than 90 Days Past Due | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		268
Consumer, Direct | Consumer | Financing Receivables, Equal to Greater than 90 Days Past Due | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		64
Consumer, Direct | Consumer | Financing Receivables, Total Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	783
Consumer, Direct | Consumer | Financing Receivables, Total Past Due | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		672
Consumer, Direct | Consumer | Financing Receivables, Total Past Due | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		133
Consumer, Direct | Consumer | Loans Not Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	20,816
Consumer, Direct | Consumer | Loans Not Past Due | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		22,789
Consumer, Direct | Consumer | Loans Not Past Due | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		4,995
Consumer, Other | Consumer
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	9,359
Consumer, Other | Consumer | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		9,868
Consumer, Other | Consumer | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		97
Consumer, Other | Consumer | Financing Receivables, 30 to 59 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	33
Consumer, Other | Consumer | Financing Receivables, 30 to 59 Days Past Due | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		24
Consumer, Other | Consumer | Financing Receivables, 30 to 59 Days Past Due | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		0
Consumer, Other | Consumer | Financing Receivables, 60 to 89 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	8
Consumer, Other | Consumer | Financing Receivables, 60 to 89 Days Past Due | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		22
Consumer, Other | Consumer | Financing Receivables, 60 to 89 Days Past Due | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		0
Consumer, Other | Consumer | Financing Receivables, Equal to Greater than 90 Days Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	0
Consumer, Other | Consumer | Financing Receivables, Equal to Greater than 90 Days Past Due | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		6
Consumer, Other | Consumer | Financing Receivables, Equal to Greater than 90 Days Past Due | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		0
Consumer, Other | Consumer | Financing Receivables, Total Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	41
Consumer, Other | Consumer | Financing Receivables, Total Past Due | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		52
Consumer, Other | Consumer | Financing Receivables, Total Past Due | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		0
Consumer, Other | Consumer | Loans Not Past Due
Financing Receivable Recorded Investment Past Due [Line Items]
Loans	$ 9,318
Consumer, Other | Consumer | Loans Not Past Due | Originated Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		9,816
Consumer, Other | Consumer | Loans Not Past Due | Acquired Loans
Financing Receivable Recorded Investment Past Due [Line Items]
Loans		$ 97

XML

Troubled Debt Restructurings (Details Textual)	3 Months Ended		9 Months Ended		12 Months Ended
	Sep. 30, 2021 USD ($) Loans Customer	Sep. 30, 2020 USD ($) Loans	Sep. 30, 2021 USD ($) Loans Customer	Sep. 30, 2020 USD ($) Loans	Dec. 31, 2020 USD ($)
Financing Receivable Modifications [Line Items]
Total troubled debt restructurings	$ 4,000,000.0		$ 4,000,000.0		$ 4,100,000
Commitments to lend additional amounts to borrowers classified as troubled debt restructurings	0		0		0
Small Business Administration (SBA), CARES Act, Paycheck Protection Program
Financing Receivable Modifications [Line Items]
Total troubled debt restructurings	$ 199,800,000		$ 199,800,000
Number of business customers facilitated assistance | Customer	1,714		1,714
Payments received from forgiveness of loans	$ 84,000,000.0
Small Business Administration (SBA), CARES Act, Paycheck Protection Program | PPP Loan Originated In 2020
Financing Receivable Modifications [Line Items]
Payments received from forgiveness of loans			$ 198,400,000
Percentage of payments received from forgiveness of loans			99.20%
Small Business Administration (SBA), CARES Act, Paycheck Protection Program | PPP Loan Originated In 2021
Financing Receivable Modifications [Line Items]
Payments received from forgiveness of loans	$ 29,200,000
Percentage of payments received from forgiveness of loans	34.70%
Consumer, Indirect
Financing Receivable Modifications [Line Items]
Troubled debt restructured loans with subsequent payment defaults | Loans | Loans	1		1
Payment Deferral
Financing Receivable Modifications [Line Items]
Number of months offered, deferrals			3 months
Residential Mortgage
Financing Receivable Modifications [Line Items]
Troubled debt restructured loans with subsequent payment defaults | Loans | Loans	1		1
Loans default payment past due period				30 days
Provision for loan losses					0
Commercial loans
Financing Receivable Modifications [Line Items]
Provision for loan losses			$ 0
Troubled debt restructured loans with subsequent payment defaults | Loans | Loans	2	1	2	1
Financing receivable number of loans past due | Loans			1
Loans default payment past due period			30 days
Commercial farmland loans
Financing Receivable Modifications [Line Items]
Troubled debt restructured loans with subsequent payment defaults | Loans | Loans		2		2
Minimum | Payment Deferral
Financing Receivable Modifications [Line Items]
Number of months offered, deferrals			3 months
Maximum | Payment Deferral
Financing Receivable Modifications [Line Items]
Number of months offered, deferrals			12 months
Troubled debt restructurings
Financing Receivable Modifications [Line Items]
Specific reserves to loans	$ 109,000		$ 109,000		$ 81,000
Allowance adjustment charge offs	15,000	$ 33,000	91,000	$ 72,000
Provision for loan losses	$ 15,000	$ 33,000	$ 90,000	$ 72,000
Extended Maturity
Financing Receivable Modifications [Line Items]
Maturity period loans		48 months
Extended Maturity | Minimum
Financing Receivable Modifications [Line Items]
Maturity period loans	193 months		22 days	48 months
Extended Maturity | Maximum
Financing Receivable Modifications [Line Items]
Maturity period loans			361 months	183 months
Contractual Interest Rate Reduction
Financing Receivable Modifications [Line Items]
Reduction of the notes stated interest rate	0.25%	2.25%
Contractual Interest Rate Reduction | Minimum
Financing Receivable Modifications [Line Items]
Reduction of the notes stated interest rate			0.25%	1.00%
Contractual Interest Rate Reduction | Maximum
Financing Receivable Modifications [Line Items]
Reduction of the notes stated interest rate			4.075%	2.25%

XML

Troubled Debt Restructurings (Details) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2021 USD ($) Loan	Sep. 30, 2020 USD ($) Loan	Sep. 30, 2021 USD ($) Loan	Sep. 30, 2020 USD ($) Loan
Financing Receivable Modifications [Line Items]
Number of Loans | Loan	9	3	30	34
Pre-Modification Outstanding Recorded Investment	$ 358	$ 63	$ 786	$ 645
Post-Modification Outstanding Recorded Investment	$ 376	$ 67	$ 774	$ 652
Originated Loans
Financing Receivable Modifications [Line Items]
Number of Loans | Loan		2		31
Pre-Modification Outstanding Recorded Investment		$ 3		$ 505
Post-Modification Outstanding Recorded Investment		$ 3		$ 508
Acquired Loans
Financing Receivable Modifications [Line Items]
Number of Loans | Loan		1		3
Pre-Modification Outstanding Recorded Investment		$ 60		$ 140
Post-Modification Outstanding Recorded Investment		$ 64		$ 144
Commercial
Financing Receivable Modifications [Line Items]
Number of Loans | Loan			4
Pre-Modification Outstanding Recorded Investment			$ 22
Post-Modification Outstanding Recorded Investment			$ 22
Commercial | Originated Loans
Financing Receivable Modifications [Line Items]
Number of Loans | Loan				1
Pre-Modification Outstanding Recorded Investment				$ 21
Post-Modification Outstanding Recorded Investment				$ 21
Residential real estate, 1-4 family residential
Financing Receivable Modifications [Line Items]
Number of Loans | Loan	2		6
Pre-Modification Outstanding Recorded Investment	$ 215		$ 426
Post-Modification Outstanding Recorded Investment	$ 233		$ 414
Residential real estate, 1-4 family residential | Originated Loans
Financing Receivable Modifications [Line Items]
Number of Loans | Loan				6
Pre-Modification Outstanding Recorded Investment				$ 245
Post-Modification Outstanding Recorded Investment				$ 246
Residential real estate, 1-4 family residential | Acquired Loans
Financing Receivable Modifications [Line Items]
Number of Loans | Loan		1		3
Pre-Modification Outstanding Recorded Investment		$ 60		$ 140
Post-Modification Outstanding Recorded Investment		$ 64		$ 144
Consumer, Indirect
Financing Receivable Modifications [Line Items]
Number of Loans | Loan	5		12
Pre-Modification Outstanding Recorded Investment	$ 30		$ 121
Post-Modification Outstanding Recorded Investment	$ 30		$ 121
Consumer, Indirect | Originated Loans
Financing Receivable Modifications [Line Items]
Number of Loans | Loan		2		19
Pre-Modification Outstanding Recorded Investment		$ 3		$ 124
Post-Modification Outstanding Recorded Investment		$ 3		$ 124
Residential real estate, Home equity lines of credit
Financing Receivable Modifications [Line Items]
Number of Loans | Loan	1		5
Pre-Modification Outstanding Recorded Investment	$ 103		$ 201
Post-Modification Outstanding Recorded Investment	$ 103		$ 201
Residential real estate, Home equity lines of credit | Originated Loans
Financing Receivable Modifications [Line Items]
Number of Loans | Loan				4
Pre-Modification Outstanding Recorded Investment				$ 100
Post-Modification Outstanding Recorded Investment				$ 102
Consumer, Direct
Financing Receivable Modifications [Line Items]
Number of Loans | Loan	1		3
Pre-Modification Outstanding Recorded Investment	$ 10		$ 16
Post-Modification Outstanding Recorded Investment	$ 10		$ 16
Consumer, Other | Originated Loans
Financing Receivable Modifications [Line Items]
Number of Loans | Loan				1
Pre-Modification Outstanding Recorded Investment				$ 15
Post-Modification Outstanding Recorded Investment				$ 15

XML

Credit Quality Indicators (Details Textual) - USD ($)	Sep. 30, 2021	Dec. 31, 2020
Financing Receivable Recorded Investment [Line Items]
Maximum commercial loan and commercial real estate relationships	$ 1,000,000
ASU 2016-13
Financing Receivable Recorded Investment [Line Items]
Change In Accounting Principle Accounting Standards Update Adopted	true
Residential real estate, 1-4 family residential
Financing Receivable Recorded Investment [Line Items]
Other real estate owned properties	$ 0	$ 0
Other real estate properties in foreclosure	$ 314,000	$ 699,000

XML

Credit Quality Indicators (Details) - USD ($) $ in Thousands	Sep. 30, 2021	Dec. 31, 2020
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans	$ 1,216,191	$ 1,345,862
Originated Loans
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans		1,185,455
Acquired Loans
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans		160,407
Pass
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans	1,169,674	1,298,645
Pass | Originated Loans
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans		1,146,329
Pass | Acquired Loans
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans		152,316
Special Mention
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans	24,974	21,593
Special Mention | Originated Loans
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans		21,054
Special Mention | Acquired Loans
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans		539
Substandard
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans	21,543	25,624
Substandard | Originated Loans
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans		18,072
Substandard | Acquired Loans
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans		7,552
Commercial real estate | Commercial real estate, Owner occupied
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans	260,180
Commercial real estate | Commercial real estate, Owner occupied | Originated Loans
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans		214,795
Commercial real estate | Commercial real estate, Owner occupied | Acquired Loans
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans		45,099
Commercial real estate | Commercial real estate, Owner occupied | Pass
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans	251,517
Commercial real estate | Commercial real estate, Owner occupied | Pass | Originated Loans
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans		208,289
Commercial real estate | Commercial real estate, Owner occupied | Pass | Acquired Loans
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans		44,031
Commercial real estate | Commercial real estate, Owner occupied | Special Mention
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans	6,470
Commercial real estate | Commercial real estate, Owner occupied | Special Mention | Originated Loans
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans		5,121
Commercial real estate | Commercial real estate, Owner occupied | Special Mention | Acquired Loans
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans		87
Commercial real estate | Commercial real estate, Owner occupied | Substandard
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans	2,193
Commercial real estate | Commercial real estate, Owner occupied | Substandard | Originated Loans
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans		1,385
Commercial real estate | Commercial real estate, Owner occupied | Substandard | Acquired Loans
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans		981
Commercial real estate | Commercial real estate, Non-owner occupied
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans	350,894
Commercial real estate | Commercial real estate, Non-owner occupied | Originated Loans
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans		309,216
Commercial real estate | Commercial real estate, Non-owner occupied | Acquired Loans
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans		52,854
Commercial real estate | Commercial real estate, Non-owner occupied | Pass
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans	326,515
Commercial real estate | Commercial real estate, Non-owner occupied | Pass | Originated Loans
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans		290,773
Commercial real estate | Commercial real estate, Non-owner occupied | Pass | Acquired Loans
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans		50,053
Commercial real estate | Commercial real estate, Non-owner occupied | Special Mention
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans	14,500
Commercial real estate | Commercial real estate, Non-owner occupied | Special Mention | Originated Loans
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans		11,240
Commercial real estate | Commercial real estate, Non-owner occupied | Special Mention | Acquired Loans
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans		49
Commercial real estate | Commercial real estate, Non-owner occupied | Substandard
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans	9,879
Commercial real estate | Commercial real estate, Non-owner occupied | Substandard | Originated Loans
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans		7,203
Commercial real estate | Commercial real estate, Non-owner occupied | Substandard | Acquired Loans
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans		2,752
Commercial real estate | Commercial farmland loans
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans	175,930
Commercial real estate | Commercial farmland loans | Originated Loans
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans		156,053
Commercial real estate | Commercial farmland loans | Acquired Loans
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans		26,079
Commercial real estate | Commercial farmland loans | Pass
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans	172,370
Commercial real estate | Commercial farmland loans | Pass | Originated Loans
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans		153,225
Commercial real estate | Commercial farmland loans | Pass | Acquired Loans
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans		24,637
Commercial real estate | Commercial farmland loans | Special Mention
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans	2,174
Commercial real estate | Commercial farmland loans | Special Mention | Originated Loans
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans		2,464
Commercial real estate | Commercial farmland loans | Special Mention | Acquired Loans
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans		100
Commercial real estate | Commercial farmland loans | Substandard
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans	1,386
Commercial real estate | Commercial farmland loans | Substandard | Originated Loans
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans		364
Commercial real estate | Commercial farmland loans | Substandard | Acquired Loans
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans		1,342
Commercial real estate | Commercial real estate, Other
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans	78,217
Commercial real estate | Commercial real estate, Other | Originated Loans
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans		77,986
Commercial real estate | Commercial real estate, Other | Acquired Loans
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans		12,868
Commercial real estate | Commercial real estate, Other | Pass
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans	77,304
Commercial real estate | Commercial real estate, Other | Pass | Originated Loans
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans		77,432
Commercial real estate | Commercial real estate, Other | Pass | Acquired Loans
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans		12,868
Commercial real estate | Commercial real estate, Other | Special Mention
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans	773
Commercial real estate | Commercial real estate, Other | Special Mention | Originated Loans
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans		387
Commercial real estate | Commercial real estate, Other | Special Mention | Acquired Loans
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans		0
Commercial real estate | Commercial real estate, Other | Substandard
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans	140
Commercial real estate | Commercial real estate, Other | Substandard | Originated Loans
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans		167
Commercial real estate | Commercial real estate, Other | Substandard | Acquired Loans
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans		0
Commercial | Commercial and industrial
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans	300,084
Commercial | Commercial and industrial | Originated Loans
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans		382,345
Commercial | Commercial and industrial | Acquired Loans
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans		18,658
Commercial | Commercial and industrial | Pass
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans	291,700
Commercial | Commercial and industrial | Pass | Originated Loans
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans		372,083
Commercial | Commercial and industrial | Pass | Acquired Loans
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans		16,246
Commercial | Commercial and industrial | Special Mention
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans	536
Commercial | Commercial and industrial | Special Mention | Originated Loans
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans		1,522
Commercial | Commercial and industrial | Special Mention | Acquired Loans
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans		0
Commercial | Commercial and industrial | Substandard
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans	7,848
Commercial | Commercial and industrial | Substandard | Originated Loans
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans		8,740
Commercial | Commercial and industrial | Substandard | Acquired Loans
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans		2,412
Commercial | Commercial, Agricultural
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans	50,886
Commercial | Commercial, Agricultural | Originated Loans
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans		45,060
Commercial | Commercial, Agricultural | Acquired Loans
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans		4,849
Commercial | Commercial, Agricultural | Pass
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans	50,268
Commercial | Commercial, Agricultural | Pass | Originated Loans
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans		44,527
Commercial | Commercial, Agricultural | Pass | Acquired Loans
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans		4,481
Commercial | Commercial, Agricultural | Special Mention
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans	521
Commercial | Commercial, Agricultural | Special Mention | Originated Loans
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans		320
Commercial | Commercial, Agricultural | Special Mention | Acquired Loans
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans		303
Commercial | Commercial, Agricultural | Substandard
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans	$ 97
Commercial | Commercial, Agricultural | Substandard | Originated Loans
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans		213
Commercial | Commercial, Agricultural | Substandard | Acquired Loans
Financing Receivable Recorded Investment [Line Items]
Total risk category of loans by class of loans		$ 65

XML

Credit Quality Indicators (Details 1) - USD ($) $ in Thousands	Sep. 30, 2021	Dec. 31, 2020
Financing Receivable Recorded Investment [Line Items]
Loans	$ 1,894,216	$ 2,078,044
Residential real estate | Residential real estate, 1-4 family residential
Financing Receivable Recorded Investment [Line Items]
Loans	376,003	412,977
Residential real estate | Residential real estate, 1-4 family residential | Originated Loans
Financing Receivable Recorded Investment [Line Items]
Loans		323,860
Residential real estate | Residential real estate, 1-4 family residential | Acquired Loans
Financing Receivable Recorded Investment [Line Items]
Loans		89,117
Residential real estate | Residential real estate, 1-4 family residential | Performing Financing Receivable
Financing Receivable Recorded Investment [Line Items]
Loans	371,577
Residential real estate | Residential real estate, 1-4 family residential | Performing Financing Receivable | Originated Loans
Financing Receivable Recorded Investment [Line Items]
Loans		322,771
Residential real estate | Residential real estate, 1-4 family residential | Performing Financing Receivable | Acquired Loans
Financing Receivable Recorded Investment [Line Items]
Loans		83,520
Residential real estate | Residential real estate, 1-4 family residential | Nonperforming Financing Receivable
Financing Receivable Recorded Investment [Line Items]
Loans	4,426
Residential real estate | Residential real estate, 1-4 family residential | Nonperforming Financing Receivable | Originated Loans
Financing Receivable Recorded Investment [Line Items]
Loans		1,089
Residential real estate | Residential real estate, 1-4 family residential | Nonperforming Financing Receivable | Acquired Loans
Financing Receivable Recorded Investment [Line Items]
Loans		5,597
Residential real estate | Residential real estate, Home equity lines of credit
Financing Receivable Recorded Investment [Line Items]
Loans	106,758	110,363
Residential real estate | Residential real estate, Home equity lines of credit | Originated Loans
Financing Receivable Recorded Investment [Line Items]
Loans		92,979
Residential real estate | Residential real estate, Home equity lines of credit | Acquired Loans
Financing Receivable Recorded Investment [Line Items]
Loans		17,384
Residential real estate | Residential real estate, Home equity lines of credit | Performing Financing Receivable
Financing Receivable Recorded Investment [Line Items]
Loans	105,903
Residential real estate | Residential real estate, Home equity lines of credit | Performing Financing Receivable | Originated Loans
Financing Receivable Recorded Investment [Line Items]
Loans		92,376
Residential real estate | Residential real estate, Home equity lines of credit | Performing Financing Receivable | Acquired Loans
Financing Receivable Recorded Investment [Line Items]
Loans		17,198
Residential real estate | Residential real estate, Home equity lines of credit | Nonperforming Financing Receivable
Financing Receivable Recorded Investment [Line Items]
Loans	855
Residential real estate | Residential real estate, Home equity lines of credit | Nonperforming Financing Receivable | Originated Loans
Financing Receivable Recorded Investment [Line Items]
Loans		603
Residential real estate | Residential real estate, Home equity lines of credit | Nonperforming Financing Receivable | Acquired Loans
Financing Receivable Recorded Investment [Line Items]
Loans		186
Consumer | Consumer, Indirect
Financing Receivable Recorded Investment [Line Items]
Loans	164,306	170,288
Consumer | Consumer, Indirect | Originated Loans
Financing Receivable Recorded Investment [Line Items]
Loans		170,288
Consumer | Consumer, Indirect | Acquired Loans
Financing Receivable Recorded Investment [Line Items]
Loans		0
Consumer | Consumer, Indirect | Performing Financing Receivable
Financing Receivable Recorded Investment [Line Items]
Loans	163,743
Consumer | Consumer, Indirect | Performing Financing Receivable | Originated Loans
Financing Receivable Recorded Investment [Line Items]
Loans		169,576
Consumer | Consumer, Indirect | Performing Financing Receivable | Acquired Loans
Financing Receivable Recorded Investment [Line Items]
Loans		0
Consumer | Consumer, Indirect | Nonperforming Financing Receivable
Financing Receivable Recorded Investment [Line Items]
Loans	563
Consumer | Consumer, Indirect | Nonperforming Financing Receivable | Originated Loans
Financing Receivable Recorded Investment [Line Items]
Loans		712
Consumer | Consumer, Indirect | Nonperforming Financing Receivable | Acquired Loans
Financing Receivable Recorded Investment [Line Items]
Loans		0
Consumer | Consumer, Direct
Financing Receivable Recorded Investment [Line Items]
Loans	21,599	28,589
Consumer | Consumer, Direct | Originated Loans
Financing Receivable Recorded Investment [Line Items]
Loans		23,461
Consumer | Consumer, Direct | Acquired Loans
Financing Receivable Recorded Investment [Line Items]
Loans		5,128
Consumer | Consumer, Direct | Performing Financing Receivable
Financing Receivable Recorded Investment [Line Items]
Loans	21,269
Consumer | Consumer, Direct | Performing Financing Receivable | Originated Loans
Financing Receivable Recorded Investment [Line Items]
Loans		23,193
Consumer | Consumer, Direct | Performing Financing Receivable | Acquired Loans
Financing Receivable Recorded Investment [Line Items]
Loans		5,064
Consumer | Consumer, Direct | Nonperforming Financing Receivable
Financing Receivable Recorded Investment [Line Items]
Loans	330
Consumer | Consumer, Direct | Nonperforming Financing Receivable | Originated Loans
Financing Receivable Recorded Investment [Line Items]
Loans		268
Consumer | Consumer, Direct | Nonperforming Financing Receivable | Acquired Loans
Financing Receivable Recorded Investment [Line Items]
Loans		64
Consumer | Consumer, Other
Financing Receivable Recorded Investment [Line Items]
Loans	9,359	9,965
Consumer | Consumer, Other | Originated Loans
Financing Receivable Recorded Investment [Line Items]
Loans		9,868
Consumer | Consumer, Other | Acquired Loans
Financing Receivable Recorded Investment [Line Items]
Loans		97
Consumer | Consumer, Other | Performing Financing Receivable
Financing Receivable Recorded Investment [Line Items]
Loans	9,359
Consumer | Consumer, Other | Performing Financing Receivable | Originated Loans
Financing Receivable Recorded Investment [Line Items]
Loans		9,862
Consumer | Consumer, Other | Performing Financing Receivable | Acquired Loans
Financing Receivable Recorded Investment [Line Items]
Loans		97
Consumer | Consumer, Other | Nonperforming Financing Receivable
Financing Receivable Recorded Investment [Line Items]
Loans	$ 0
Consumer | Consumer, Other | Nonperforming Financing Receivable | Originated Loans
Financing Receivable Recorded Investment [Line Items]
Loans		6
Consumer | Consumer, Other | Nonperforming Financing Receivable | Acquired Loans
Financing Receivable Recorded Investment [Line Items]
Loans		$ 0

XML

Credit Quality Indicators (Details 2) - USD ($) $ in Thousands	Sep. 30, 2021	Dec. 31, 2020
Financing Receivable Recorded Investment [Line Items]
Total	$ 1,894,216	$ 2,078,044
Commercial real estate
Financing Receivable Recorded Investment [Line Items]
2021	79,940
2020	103,568
2019	140,238
2018	95,318
2017	68,813
Prior	185,252
Revolving Loans	16,162
Total	689,291
Commercial real estate | Pass
Financing Receivable Recorded Investment [Line Items]
2021	79,167
2020	103,241
2019	128,436
2018	93,100
2017	65,831
Prior	169,999
Revolving Loans	15,562
Total	655,336
Commercial real estate | Special Mention
Financing Receivable Recorded Investment [Line Items]
2021	773
2020	0
2019	9,518
2018	1,716
2017	2,892
Prior	6,365
Revolving Loans	479
Total	21,743
Commercial real estate | Substandard
Financing Receivable Recorded Investment [Line Items]
2021	0
2020	327
2019	2,284
2018	502
2017	90
Prior	8,888
Revolving Loans	121
Total	12,212
Commercial
Financing Receivable Recorded Investment [Line Items]
2021	93,888
2020	61,485
2019	26,354
2018	29,340
2017	12,546
Prior	18,891
Revolving Loans	57,580
Total	300,084
Commercial | Pass
Financing Receivable Recorded Investment [Line Items]
2021	90,549
2020	59,498
2019	25,933
2018	29,075
2017	11,732
Prior	18,807
Revolving Loans	56,106
Total	291,700
Commercial | Special Mention
Financing Receivable Recorded Investment [Line Items]
2021	220
2020	106
2019	87
2018	0
2017	0
Prior	0
Revolving Loans	123
Total	536
Commercial | Substandard
Financing Receivable Recorded Investment [Line Items]
2021	3,119
2020	1,881
2019	334
2018	265
2017	814
Prior	84
Revolving Loans	1,351
Total	7,848
Agricultural
Financing Receivable Recorded Investment [Line Items]
2021	30,941
2020	54,297
2019	30,347
2018	31,211
2017	22,150
Prior	39,285
Revolving Loans	18,585
Total	226,816
Agricultural | Pass
Financing Receivable Recorded Investment [Line Items]
2021	30,585
2020	54,038
2019	30,248
2018	31,198
2017	20,075
Prior	38,288
Revolving Loans	18,206
Total	222,638
Agricultural | Special Mention
Financing Receivable Recorded Investment [Line Items]
2021	0
2020	238
2019	33
2018	0
2017	2,075
Prior	0
Revolving Loans	349
Total	2,695
Agricultural | Substandard
Financing Receivable Recorded Investment [Line Items]
2021	356
2020	21
2019	66
2018	13
2017	0
Prior	997
Revolving Loans	30
Total	1,483
Residential real estate
Financing Receivable Recorded Investment [Line Items]
2021	49,039
2020	78,879
2019	37,720
2018	29,415
2017	40,442
Prior	137,823
Revolving Loans	2,685
Total	376,003
Residential real estate | Pass
Financing Receivable Recorded Investment [Line Items]
2021	48,989
2020	78,879
2019	37,697
2018	29,361
2017	39,854
Prior	129,640
Revolving Loans	2,685
Total	367,105
Residential real estate | Special Mention
Financing Receivable Recorded Investment [Line Items]
2021	0
2020	0
2019	0
2018	0
2017	0
Prior	0
Revolving Loans	0
Total	0
Residential real estate | Substandard
Financing Receivable Recorded Investment [Line Items]
2021	50
2020	0
2019	23
2018	54
2017	588
Prior	8,183
Revolving Loans	0
Total	8,898
Home equity lines of credit
Financing Receivable Recorded Investment [Line Items]
2021	146
2020	0
2019	20
2018	74
2017	176
Prior	2,570
Revolving Loans	103,772
Total	106,758
Home equity lines of credit | Pass
Financing Receivable Recorded Investment [Line Items]
2021	146
2020	0
2019	0
2018	0
2017	99
Prior	1,213
Revolving Loans	103,502
Total	104,960
Home equity lines of credit | Special Mention
Financing Receivable Recorded Investment [Line Items]
2021	0
2020	0
2019	0
2018	0
2017	0
Prior	0
Revolving Loans	48
Total	48
Home equity lines of credit | Substandard
Financing Receivable Recorded Investment [Line Items]
2021	0
2020	0
2019	20
2018	74
2017	77
Prior	1,357
Revolving Loans	222
Total	1,750
Consumer
Financing Receivable Recorded Investment [Line Items]
2021	46,708
2020	50,847
2019	39,292
2018	23,756
2017	11,518
Prior	16,949
Revolving Loans	6,194
Total	195,264
Consumer | Pass
Financing Receivable Recorded Investment [Line Items]
2021	46,676
2020	50,526
2019	39,119
2018	23,551
2017	11,356
Prior	16,516
Revolving Loans	6,194
Total	193,938
Consumer | Special Mention
Financing Receivable Recorded Investment [Line Items]
2021	0
2020	0
2019	0
2018	0
2017	0
Prior	0
Revolving Loans	0
Total	0
Consumer | Substandard
Financing Receivable Recorded Investment [Line Items]
2021	32
2020	321
2019	173
2018	205
2017	162
Prior	433
Revolving Loans	0
Total	$ 1,326

XML

Revenue from Contracts with Customers (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Disaggregation Of Revenue [Line Items]
TOTAL NONINTEREST INCOME	$ 9,015	$ 9,217	$ 28,706	$ 25,662
Service Charges on Deposit Accounts
Disaggregation Of Revenue [Line Items]
Noninterest income	924	904	2,522	2,752
Debit Card and EFT Fees
Disaggregation Of Revenue [Line Items]
Noninterest income	1,128	1,048	3,438	2,866
Trust Fees
Disaggregation Of Revenue [Line Items]
Noninterest income	2,335	1,973	6,929	5,682
Insurance Agency Commissions
Disaggregation Of Revenue [Line Items]
Noninterest income	799	784	2,748	2,348
Retirement Plan Consulting Fees
Disaggregation Of Revenue [Line Items]
Noninterest income	334	341	1,043	1,129
Investment Commissions
Disaggregation Of Revenue [Line Items]
Noninterest income	638	353	1,665	1,080
Operating Segments
Disaggregation Of Revenue [Line Items]
TOTAL NONINTEREST INCOME	9,015	9,217	28,706	25,662
Operating Segments | Service Charges on Deposit Accounts
Disaggregation Of Revenue [Line Items]
Noninterest income	924	904	2,522	2,752
Operating Segments | Debit Card and EFT Fees
Disaggregation Of Revenue [Line Items]
Noninterest income	1,128	1,048	3,438	2,866
Operating Segments | Trust Fees
Disaggregation Of Revenue [Line Items]
Noninterest income	2,335	1,973	6,929	5,682
Operating Segments | Insurance Agency Commissions
Disaggregation Of Revenue [Line Items]
Noninterest income	799	784	2,748	2,348
Operating Segments | Retirement Plan Consulting Fees
Disaggregation Of Revenue [Line Items]
Noninterest income	334	341	1,043	1,129
Operating Segments | Investment Commissions
Disaggregation Of Revenue [Line Items]
Noninterest income	638	353	1,665	1,080
Operating Segments | Other
Disaggregation Of Revenue [Line Items]
Other (outside the scope of ASC 606)	2,857	3,814	10,361	9,805
Operating Segments | Trust Segment
Disaggregation Of Revenue [Line Items]
TOTAL NONINTEREST INCOME	2,669	2,314	7,972	6,811
Operating Segments | Trust Segment | Service Charges on Deposit Accounts
Disaggregation Of Revenue [Line Items]
Noninterest income	0	0	0	0
Operating Segments | Trust Segment | Debit Card and EFT Fees
Disaggregation Of Revenue [Line Items]
Noninterest income	0	0	0	0
Operating Segments | Trust Segment | Trust Fees
Disaggregation Of Revenue [Line Items]
Noninterest income	2,335	1,973	6,929	5,682
Operating Segments | Trust Segment | Insurance Agency Commissions
Disaggregation Of Revenue [Line Items]
Noninterest income	0	0	0	0
Operating Segments | Trust Segment | Retirement Plan Consulting Fees
Disaggregation Of Revenue [Line Items]
Noninterest income	334	341	1,043	1,129
Operating Segments | Trust Segment | Investment Commissions
Disaggregation Of Revenue [Line Items]
Noninterest income	0	0	0	0
Operating Segments | Trust Segment | Other
Disaggregation Of Revenue [Line Items]
Other (outside the scope of ASC 606)	0	0	0	0
Operating Segments | Bank Segment
Disaggregation Of Revenue [Line Items]
TOTAL NONINTEREST INCOME	6,346	6,903	20,734	18,851
Operating Segments | Bank Segment | Service Charges on Deposit Accounts
Disaggregation Of Revenue [Line Items]
Noninterest income	924	904	2,522	2,752
Operating Segments | Bank Segment | Debit Card and EFT Fees
Disaggregation Of Revenue [Line Items]
Noninterest income	1,128	1,048	3,438	2,866
Operating Segments | Bank Segment | Trust Fees
Disaggregation Of Revenue [Line Items]
Noninterest income	0	0	0	0
Operating Segments | Bank Segment | Insurance Agency Commissions
Disaggregation Of Revenue [Line Items]
Noninterest income	799	784	2,748	2,348
Operating Segments | Bank Segment | Retirement Plan Consulting Fees
Disaggregation Of Revenue [Line Items]
Noninterest income	0	0	0	0
Operating Segments | Bank Segment | Investment Commissions
Disaggregation Of Revenue [Line Items]
Noninterest income	638	353	1,665	1,080
Operating Segments | Bank Segment | Other
Disaggregation Of Revenue [Line Items]
Other (outside the scope of ASC 606)	$ 2,857	$ 3,814	$ 10,361	$ 9,805

XML

Revenue from Contracts with Customers (Details Textual) - ASC 606	9 Months Ended
	Sep. 30, 2021 USD ($)
Revenue From Contract With Customer [Line Items]
Contingent debit card interchange fees	$ 0
Contingent incentive fees	0
Contingent commission	$ 0
Percentage of insurance agency commissions representing total revenue	2.40%
Percentage of retirement plan consulting fees representing total revenue	0.90%
Percentage of investment commissions representing total revenue	1.50%
Cetera
Revenue From Contract With Customer [Line Items]
Contingent investment commissions to be refunded	$ 0

XML

Fair Value (Details) - USD ($) $ in Thousands	Sep. 30, 2021	Dec. 31, 2020
Financial Assets
Securities available for sale	$ 1,183,361	$ 575,600
Derivative Assets	2,768	4,221
Fair Value, Measurements, Recurring
Financial Assets
Total investment securities	1,189,878	582,481
Corporate bonds
Financial Assets
Securities available for sale	3,667	3,712
Corporate bonds | Fair Value, Measurements, Recurring
Financial Assets
Securities available for sale	3,667	3,712
Collateralized mortgage obligations | Fair Value, Measurements, Recurring
Financial Assets
Securities available for sale	13,241	26,393
Small Business Administration
Financial Assets
Securities available for sale	4,596	5,562
Small Business Administration | Fair Value, Measurements, Recurring
Financial Assets
Securities available for sale	4,596	5,562
Other investments measured at net asset value | Fair Value, Measurements, Recurring
Financial Assets
Equity securities	6,024	6,343
U.S. Treasury and U.S. government sponsored entities
Financial Assets
Securities available for sale	88,470	11,845
U.S. Treasury and U.S. government sponsored entities | Fair Value, Measurements, Recurring
Financial Assets
Securities available for sale	88,470	11,845
State and political subdivisions
Financial Assets
Securities available for sale	507,283	366,306
State and political subdivisions | Fair Value, Measurements, Recurring
Financial Assets
Securities available for sale	507,283	366,306
Mortgage-backed securities - residential
Financial Assets
Securities available for sale	566,104	161,782
Mortgage-backed securities - residential | Fair Value, Measurements, Recurring
Financial Assets
Securities available for sale	566,104	161,782
Equity securities at fair value | Fair Value, Measurements, Recurring
Financial Assets
Equity securities	493	538
Interest rate swaps | Fair Value, Measurements, Recurring
Financial Assets
Derivative Assets	2,768	4,221
Financial Liabilities
Derivative liabilities	2,768	4,221
Quoted Prices in Active Markets for Identical Assets (Level 1) | Fair Value, Measurements, Recurring
Financial Assets
Total investment securities	493	538
Quoted Prices in Active Markets for Identical Assets (Level 1) | Corporate bonds | Fair Value, Measurements, Recurring
Financial Assets
Securities available for sale	0	0
Quoted Prices in Active Markets for Identical Assets (Level 1) | Collateralized mortgage obligations | Fair Value, Measurements, Recurring
Financial Assets
Securities available for sale	0	0
Quoted Prices in Active Markets for Identical Assets (Level 1) | Small Business Administration | Fair Value, Measurements, Recurring
Financial Assets
Securities available for sale	0	0
Quoted Prices in Active Markets for Identical Assets (Level 1) | U.S. Treasury and U.S. government sponsored entities | Fair Value, Measurements, Recurring
Financial Assets
Securities available for sale	0	0
Quoted Prices in Active Markets for Identical Assets (Level 1) | State and political subdivisions | Fair Value, Measurements, Recurring
Financial Assets
Securities available for sale	0	0
Quoted Prices in Active Markets for Identical Assets (Level 1) | Mortgage-backed securities - residential | Fair Value, Measurements, Recurring
Financial Assets
Securities available for sale	0	0
Quoted Prices in Active Markets for Identical Assets (Level 1) | Equity securities at fair value | Fair Value, Measurements, Recurring
Financial Assets
Equity securities	493	538
Quoted Prices in Active Markets for Identical Assets (Level 1) | Interest rate swaps | Fair Value, Measurements, Recurring
Financial Assets
Derivative Assets	0	0
Financial Liabilities
Derivative liabilities	0	0
Significant Other Observable Inputs (Level 2) | Fair Value, Measurements, Recurring
Financial Assets
Total investment securities	1,183,358	575,596
Significant Other Observable Inputs (Level 2) | Corporate bonds | Fair Value, Measurements, Recurring
Financial Assets
Securities available for sale	3,667	3,712
Significant Other Observable Inputs (Level 2) | Collateralized mortgage obligations | Fair Value, Measurements, Recurring
Financial Assets
Securities available for sale	13,241	26,393
Significant Other Observable Inputs (Level 2) | Small Business Administration | Fair Value, Measurements, Recurring
Financial Assets
Securities available for sale	4,596	5,562
Significant Other Observable Inputs (Level 2) | U.S. Treasury and U.S. government sponsored entities | Fair Value, Measurements, Recurring
Financial Assets
Securities available for sale	88,470	11,845
Significant Other Observable Inputs (Level 2) | State and political subdivisions | Fair Value, Measurements, Recurring
Financial Assets
Securities available for sale	507,283	366,306
Significant Other Observable Inputs (Level 2) | Mortgage-backed securities - residential | Fair Value, Measurements, Recurring
Financial Assets
Securities available for sale	566,101	161,778
Significant Other Observable Inputs (Level 2) | Equity securities at fair value | Fair Value, Measurements, Recurring
Financial Assets
Equity securities	0	0
Significant Other Observable Inputs (Level 2) | Interest rate swaps | Fair Value, Measurements, Recurring
Financial Assets
Derivative Assets	2,768	4,221
Financial Liabilities
Derivative liabilities	2,768	4,221
Significant Unobservable Inputs (Level 3) | Fair Value, Measurements, Recurring
Financial Assets
Total investment securities	3	4
Significant Unobservable Inputs (Level 3) | Corporate bonds | Fair Value, Measurements, Recurring
Financial Assets
Securities available for sale	0	0
Significant Unobservable Inputs (Level 3) | Collateralized mortgage obligations | Fair Value, Measurements, Recurring
Financial Assets
Securities available for sale	0	0
Significant Unobservable Inputs (Level 3) | Small Business Administration | Fair Value, Measurements, Recurring
Financial Assets
Securities available for sale	0	0
Significant Unobservable Inputs (Level 3) | U.S. Treasury and U.S. government sponsored entities | Fair Value, Measurements, Recurring
Financial Assets
Securities available for sale	0	0
Significant Unobservable Inputs (Level 3) | State and political subdivisions | Fair Value, Measurements, Recurring
Financial Assets
Securities available for sale	0	0
Significant Unobservable Inputs (Level 3) | Mortgage-backed securities - residential | Fair Value, Measurements, Recurring
Financial Assets
Securities available for sale	3	4
Significant Unobservable Inputs (Level 3) | Equity securities at fair value | Fair Value, Measurements, Recurring
Financial Assets
Equity securities	0	0
Significant Unobservable Inputs (Level 3) | Interest rate swaps | Fair Value, Measurements, Recurring
Financial Assets
Derivative Assets	0	0
Financial Liabilities
Derivative liabilities	$ 0	$ 0

XML

Fair Value (Details Textual) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020	Dec. 31, 2020
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Fair value assets liabilities transfers amount between level 1 and level 2	$ 0	$ 0	$ 0	$ 0
Troubled debt restructurings	4,000		$ 4,000		$ 4,100
Maximum maturity period of short term borrowings			90 days
Measured Using Present Value of Cash Flows
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Troubled debt restructurings	724		$ 724		513
Collateral Dependent Loans
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Collateral dependent loans, unpaid principal balance with allowance recorded	3,500		3,500
Collateral dependent loans, allowance	$ 435		$ 435
Collateral Dependent Impaired Loans
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Impaired loans, unpaid principal balance with allowance recorded					2,300
Impaired loans, allowance					$ 368

XML

Fair Value (Details 1) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Reconciliation for all assets measured at fair value on a recurring basis using significant unobservable inputs
Beginning Balance	$ 3	$ 4	$ 4	$ 5
Transfers from level 2	0	0	0	0
Repayments, calls and maturities	0	0	(1)	(1)
Ending Balance	$ 3	$ 4	$ 3	$ 4

XML

Fair Value (Details 2) - Fair Value, Measurements, Nonrecurring - USD ($) $ in Thousands	Sep. 30, 2021	Dec. 31, 2020
Commercial
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Recorded Investment		$ 1,770
Commercial | Commercial, Commercial and industrial
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Recorded Investment	$ 2,954
Residential Real Estate
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Recorded Investment	82
Recorded Investment		82
Consumer
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Recorded Investment		36
Quoted Prices in Active Markets for Identical Assets (Level 1) | Commercial
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Recorded Investment		0
Quoted Prices in Active Markets for Identical Assets (Level 1) | Commercial | Commercial, Commercial and industrial
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Recorded Investment	0
Quoted Prices in Active Markets for Identical Assets (Level 1) | Residential Real Estate
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Recorded Investment	0
Recorded Investment		0
Quoted Prices in Active Markets for Identical Assets (Level 1) | Consumer
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Recorded Investment		0
Significant Other Observable Inputs (Level 2) | Commercial
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Recorded Investment		0
Significant Other Observable Inputs (Level 2) | Commercial | Commercial, Commercial and industrial
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Recorded Investment	0
Significant Other Observable Inputs (Level 2) | Residential Real Estate
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Recorded Investment	0
Recorded Investment		0
Significant Other Observable Inputs (Level 2) | Consumer
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Recorded Investment		0
Significant Unobservable Inputs (Level 3) | Commercial
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Recorded Investment		1,770
Significant Unobservable Inputs (Level 3) | Commercial | Commercial, Commercial and industrial
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Recorded Investment	2,954
Significant Unobservable Inputs (Level 3) | Residential Real Estate
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Recorded Investment	$ 82
Recorded Investment		82
Significant Unobservable Inputs (Level 3) | Consumer
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Recorded Investment		$ 36

XML

Fair Value (Details 3) - Fair Value, Measurements, Nonrecurring $ in Thousands	9 Months Ended	12 Months Ended
	Sep. 30, 2021 USD ($)	Dec. 31, 2020 USD ($)
Commercial
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Recorded Investment		$ 1,770
Residential Real Estate
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Recorded Investment	$ 82
Recorded Investment		82
Consumer
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Recorded Investment		$ 36
Sales Comparison Valuation | Commercial
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Recorded Investment	$ 2,954
Fair Value Measurements Valuation Technique(s) Description	Sales Comparison	Sales comparison
Recorded Investment		$ 1,770
Sales Comparison Valuation | Commercial | Minimum | Measurement Input, Comparability Adjustment
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Adjustment for differences between earning multiplier and comparable sales, Percent	(14.66)	(24.01)
Sales Comparison Valuation | Commercial | Maximum | Measurement Input, Comparability Adjustment
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Adjustment for differences between earning multiplier and comparable sales, Percent	8.99	17.93
Sales Comparison Valuation | Commercial | Weighted Average | Measurement Input, Comparability Adjustment
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Adjustment for differences between earning multiplier and comparable sales, Percent	0	(0.48)
Sales Comparison Valuation | Residential Real Estate
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Recorded Investment	$ 82
Fair Value Measurements Valuation Technique(s) Description	Sales comparison	Sales comparison
Recorded Investment		$ 82
Sales Comparison Valuation | Residential Real Estate | Minimum | Measurement Input, Comparability Adjustment
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Adjustment for differences between earning multiplier and comparable sales, Percent	(3.84)	(40.00)
Sales Comparison Valuation | Residential Real Estate | Maximum | Measurement Input, Comparability Adjustment
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Adjustment for differences between earning multiplier and comparable sales, Percent	3.22	47.15
Sales Comparison Valuation | Residential Real Estate | Weighted Average | Measurement Input, Comparability Adjustment
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Adjustment for differences between earning multiplier and comparable sales, Percent	(0.12)	(17.77)
Sales Comparison Valuation | Consumer
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Fair Value Measurements Valuation Technique(s) Description		Sales comparison
Recorded Investment		$ 36
Sales Comparison Valuation | Consumer | Minimum | Measurement Input, Comparability Adjustment
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Adjustment for differences between earning multiplier and comparable sales, Percent		(23.60)
Sales Comparison Valuation | Consumer | Maximum | Measurement Input, Comparability Adjustment
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Adjustment for differences between earning multiplier and comparable sales, Percent		23.60
Sales Comparison Valuation | Consumer | Weighted Average | Measurement Input, Comparability Adjustment
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Adjustment for differences between earning multiplier and comparable sales, Percent		0.00

XML

Fair Value (Details 4) - USD ($) $ in Thousands	Sep. 30, 2021	Dec. 31, 2020	Sep. 30, 2020	Dec. 31, 2019
Financial assets
Cash and cash equivalents, Carrying Amount	$ 79,808	$ 254,621	$ 199,575	$ 70,760
Restricted stock, Carrying Amount	12,524	14,647
Loans held for sale, Carrying Amount	2,628	4,766
Loans, net, Carrying Amount	1,871,080	2,055,900
Accrued interest receivable, Carrying Amount	9,930	9,880
Financial liabilities
Deposits, Carrying Amount	2,866,413	2,610,878
Long-term borrowings	49,649	76,385
Accrued interest payable, Carrying Amount	389	690
Short-term borrowings, Carrying Amount	0	2,521
Fair Value, Measurements, Recurring
Financial assets
Cash and cash equivalents, Fair Value	79,808	254,621
Loans held for sale, Fair Value	2,707	4,909
Loans, net, Fair Value	1,857,184	2,036,872
Accrued interest receivable, Fair Value	9,930	9,880
Financial liabilities
Deposits, Fair Value	2,865,677	2,584,837
Long-term borrowings, Fair Value	49,267	77,189
Accrued interest payable, Fair value	389	690
Short-term borrowings, Fair Value		2,521
Fair Value, Measurements, Recurring | Level 1
Financial assets
Cash and cash equivalents, Fair Value	26,933	20,503
Loans held for sale, Fair Value	0	0
Loans, net, Fair Value	0	0
Accrued interest receivable, Fair Value	0	0
Financial liabilities
Deposits, Fair Value	2,514,758	2,097,732
Long-term borrowings, Fair Value	0	0
Accrued interest payable, Fair value	26	36
Short-term borrowings, Fair Value		0
Fair Value, Measurements, Recurring | Level 2
Financial assets
Cash and cash equivalents, Fair Value	52,875	234,118
Loans held for sale, Fair Value	2,707	4,909
Loans, net, Fair Value	0	0
Accrued interest receivable, Fair Value	5,126	3,297
Financial liabilities
Deposits, Fair Value	350,919	487,105
Long-term borrowings, Fair Value	49,267	77,189
Accrued interest payable, Fair value	363	654
Short-term borrowings, Fair Value		2,521
Fair Value, Measurements, Recurring | Level 3
Financial assets
Cash and cash equivalents, Fair Value	0	0
Loans held for sale, Fair Value	0	0
Loans, net, Fair Value	1,857,184	2,036,872
Accrued interest receivable, Fair Value	4,804	6,583
Financial liabilities
Deposits, Fair Value	0	0
Long-term borrowings, Fair Value	0	0
Accrued interest payable, Fair value	$ 0	0
Short-term borrowings, Fair Value		$ 0

XML

Goodwill and Intangible Assets (Details Textual) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020	Dec. 31, 2020
Goodwill And Intangible Assets Disclosure [Abstract]
Goodwill associated with the Company's purchase and other past acquisitions	$ 45,775		$ 45,775		$ 45,775
Aggregate amortization expense	$ 316	$ 332	$ 948	$ 995

XML

Goodwill and Intangible Assets (Details) - USD ($) $ in Thousands	Sep. 30, 2021	Dec. 31, 2020
Acquired intangible assets
Gross Carrying Amount	$ 15,139	$ 15,139
Accumulated Amortization	(12,244)	(11,297)
Customer Relationships
Acquired intangible assets
Gross Carrying Amount	7,210	7,210
Accumulated Amortization	(6,557)	(6,318)
Non-compete contracts
Acquired intangible assets
Gross Carrying Amount	430	430
Accumulated Amortization	(391)	(388)
Trade Name
Acquired intangible assets
Gross Carrying Amount	520	520
Accumulated Amortization	(350)	(320)
Core Deposits
Acquired intangible assets
Gross Carrying Amount	6,979	6,979
Accumulated Amortization	$ (4,946)	$ (4,271)

XML

Goodwill and Intangible Assets (Details 1) - USD ($) $ in Thousands	Sep. 30, 2021	Dec. 31, 2020
Finite Lived Intangible Assets Future Amortization Expense [Abstract]
2021 (3 months)	$ 318
2022	1,090
2023	617
2024	314
2025	253
Thereafter	303
Total	$ 2,895	$ 3,842

XML

Leases (Details Textual) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020	Dec. 31, 2020
Lessee Lease Description [Line Items]
Operating leases options to extend [true false]			true
Operating leases Options to terminate			2 months
Operating lease, description			The Company has operating leases for branch office locations, vehicles and certain office equipment such as printers, copiers and faxes. The leases have remaining lease terms of 7 months to 8.3 years, some of which include options to extend the lease for up to 10 years and some of which include options to terminate the leases within 2 months.
Operating lease, right-of-use asset	$ 4,500		$ 4,500		$ 4,800
Operating lease, liability	4,687		4,687		$ 5,000
Operating lease, payments	206	$ 191	610	$ 581
Finance leases, interest expense	44	38	116	95
Finance leases, amortization expense	$ 124	$ 121	$ 366	$ 334
Weighted average remaining lease term			4 years 2 months 12 days
Weighted-average discount rate	2.40%		2.40%
Minimum
Lessee Lease Description [Line Items]
Operating leases remaining lease terms	7 months		7 months
Maximum
Lessee Lease Description [Line Items]
Operating leases remaining lease terms	8 years 3 months 18 days		8 years 3 months 18 days
Operating leases options to extend			10 years

XML

Leases (Details) - USD ($) $ in Thousands	Sep. 30, 2021	Dec. 31, 2020
Leases [Abstract]
2021 (3 months)	$ 201
2022	647
2023	592
2024	417
2025	424
Thereafter	3,240
Total Payments	5,521
Less: Imputed Interest	(834)
Total	$ 4,687	$ 5,000

XML

Interest-Rate Swaps (Details) - USD ($) $ in Thousands	9 Months Ended	12 Months Ended
	Sep. 30, 2021	Dec. 31, 2020
Interest Rate Derivatives [Abstract]
Notional amounts	$ 48,985	$ 41,315
Weighted average pay rate on interest-rate swaps	4.63%	4.63%
Weighted average receive rate on interest-rate swaps	2.27%	2.36%
Weighted average maturity (years)	3 years 10 months 24 days	4 years 3 months 18 days
Fair value of interest-rate swaps	$ (2,768)	$ (4,221)
Fair value of loan yield maintenance provisions	$ 2,768	$ 4,221

XML

Interest-Rate Swaps (Details Textual) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Interest rate swaps
Derivative [Line Items]
Net Gain or Loss recognized in earnings	$ 0	$ 0	$ 0	$ 0

XML

Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Basic EPS
Net income	$ 16,011	$ 10,869	$ 46,142	$ 30,519
Weighted average shares outstanding	28,246,206	28,182,744	28,235,732	28,293,445
Basic earnings per share	$ 0.57	$ 0.39	$ 1.63	$ 1.08
Diluted EPS
Net income	$ 16,011	$ 10,869	$ 46,142	$ 30,519
Weighted average shares outstanding	28,246,206	28,182,744	28,235,732	28,293,445
Dilutive effect of restricted stock awards	114,355	107,778	102,813	127,779
Weighted average shares for diluted earnings per share	28,360,561	28,290,522	28,338,545	28,421,224
Diluted earnings per share	$ 0.56	$ 0.38	$ 1.63	$ 1.07

XML

Earnings Per Share (Details Textual) - shares	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Restricted Stock Awards
Earnings Per Share Basic [Line Items]
Anti-dilutive securities excluded from computation of earnings per share	17,495	0	94,247	0

XML

Stock Based Compensation (Details Textual) - 2017 Incentive Plan - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020	Dec. 31, 2017
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Number of shares vested			78,948
Number of shares vested, weighted average fair value			$ 14.36
Restricted Stock Awards
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Maximum shares available under equity incentive plan					800,000
Number of shares available for grant	300,009		300,009
Stock based compensation expense	$ 278	$ 364	$ 865	$ 1,100
Unrecognized compensation expense	$ 1,700		$ 1,700
Compensation cost not yet recognized, period for recognition			2 years 7 months 6 days
Time Based Restricted Stock Awards
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Share awards granted under equity incentive plan			38,061
Number of shares vested			26,621
Number of shares vested, weighted average fair value			$ 14.41
Performance Based Restricted Stock Awards
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Share awards granted under equity incentive plan			58,245
Number of shares vested			52,327
Number of shares vested, weighted average fair value			$ 14.34

XML

Stock Based Compensation (Details) - 2017 Incentive Plan	9 Months Ended
	Sep. 30, 2021 $ / shares shares
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Vested, Maximum Awarded Units | shares	(78,948)
Vested, Weighted Average Grant Date Fair Value | $ / shares	$ 14.36
Time Based Restricted Stock Awards
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Beginning balance - non-vested shares, Maximum Awarded Unit | shares	67,765
Granted, Maximum Awarded Units | shares	38,061
Vested, Maximum Awarded Units | shares	(26,621)
Forfeited, Maximum Awarded Units | shares	(4,758)
Ending balance - non-vested shares, Maximum Awarded Unit | shares	74,447
Beginning balance - non-vested shares, Weighted Average Grant Date Fair Value | $ / shares	$ 14.32
Granted, Weighted Average Grant Date Fair Value | $ / shares	15.45
Vested, Weighted Average Grant Date Fair Value | $ / shares	14.41
Forfeited, Weighted Average Grant Date Fair Value | $ / shares	14.15
Ending balance - non-vested shares, Weighted Average Grant Date Fair Value | $ / shares	$ 14.94
Performance Based Restricted Stock Awards
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Beginning balance - non-vested shares, Maximum Awarded Unit | shares	153,070
Granted, Maximum Awarded Units | shares	58,245
Vested, Maximum Awarded Units | shares	(52,327)
Forfeited, Maximum Awarded Units | shares	0
Ending balance - non-vested shares, Maximum Awarded Unit | shares	158,988
Beginning balance - non-vested shares, Weighted Average Grant Date Fair Value | $ / shares	$ 14.46
Granted, Weighted Average Grant Date Fair Value | $ / shares	14.21
Vested, Weighted Average Grant Date Fair Value | $ / shares	14.34
Forfeited, Weighted Average Grant Date Fair Value | $ / shares	0
Ending balance - non-vested shares, Weighted Average Grant Date Fair Value | $ / shares	$ 14.40

XML

Other Comprehensive Income (Loss) (Details) - USD ($) $ in Thousands		3 Months Ended		9 Months Ended
		Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Comprehensive Income Net Of Tax [Abstract]
Unrealized holding gains (losses) on available-for-sale securities during the period, pre-tax		$ (2,754)	$ 700	$ (8,990)	$ 13,894
Reclassification adjustment for (gains) losses included in net income, pre-tax	[1]	(464)	(48)	(848)	(318)
Net other comprehensive income (loss), pre-tax		(3,218)	652	(9,838)	13,576
Unrealized holding gains (losses) on available-for-sale securities during the period, tax		578	(147)	1,888	(2,918)
Reclassification adjustment for (gains) losses included in net income, tax	[1]	96	9	178	66
Net other comprehensive income (loss), tax		674	(138)	2,066	(2,852)
Unrealized holding gains (losses) on available-for-sale securities during the period, after tax		(2,176)	553	(7,102)	10,976
Reclassification adjustment for (gains) losses included in net income, after-tax	[1]	(368)	(39)	(670)	(252)
Other comprehensive income (loss), net of tax		$ (2,544)	$ 514	$ (7,772)	$ 10,724

[1] Pre-tax reclassification adjustments relating to available-for-sale securities are reported in security gains and the tax impact is included in income tax expense on the consolidated statements of income.

XML

Regulatory Capital Matters (Details Textual)	Sep. 30, 2021	Dec. 31, 2020
Regulatory Matters (Additional Textual) [Abstract]
Common equity tier 1 capital to risk-weighted assets, capital conservation buffer ratio	2.50%
Tier 1 capital to risk-weighted assets, capital conservation buffer ratio	2.50%
Total capital to risk-weighted assets, capital conservation buffer ratio	2.50%
Minimum ratio of common equity tier 1 capital to risk-weighted assets	4.50%	4.50%
Minimum ratio of tier 1 capital to risk-weighted assets	0.060	0.060
Minimum ratio of total capital to risk-weighted assets	0.080	0.080
Minimum leverage ratio	0.040	0.040
Farmers National Banc Corp
Regulatory Matters (Additional Textual) [Abstract]
Minimum ratio of common equity tier 1 capital to risk-weighted assets	4.50%	4.50%
Minimum ratio of tier 1 capital to risk-weighted assets	0.060	0.060
Minimum ratio of total capital to risk-weighted assets	0.080	0.080
Minimum leverage ratio	0.040	0.040

XML

Regulatory Capital Matters (Details) - USD ($) $ in Thousands	Sep. 30, 2021	Dec. 31, 2020
Common equity tier 1 capital ratio
Actual, Amount	$ 315,850	$ 279,864
Actual, Ratio	14.55%	13.22%
Requirement for Capital Adequacy Purposes, Amount	$ 97,715	$ 95,211
Requirement for Capital Adequacy Purposes, Ratio	4.50%	4.50%
Total risk based capital ratio
Actual, Amount	$ 351,987	$ 311,413
Actual, Ratio	0.1621	0.1472
Requirement for Capital Adequacy Purposes, Amount	$ 173,715	$ 169,264
Requirement for Capital Adequacy Purposes, Ratio	0.080	0.080
Tier 1 risk based capital ratio
Actual, Amount	$ 328,850	$ 289,269
Actual, Ratio	0.1514	0.1367
Requirement for Capital Adequacy Purposes, Amount	$ 130,286	$ 126,948
Requirement for Capital Adequacy Purposes, Ratio	0.060	0.060
Tier 1 leverage ratio
Actual, Amount	$ 328,850	$ 289,269
Actual, Ratio	0.1017	0.0977
Requirement for Capital Adequacy Purposes, Amount	$ 129,307	$ 118,464
Requirement for Capital Adequacy Purposes, Ratio	0.040	0.040
Farmers National Banc Corp
Common equity tier 1 capital ratio
Actual, Amount	$ 265,224	$ 268,041
Actual, Ratio	12.23%	12.71%
Requirement for Capital Adequacy Purposes, Amount	$ 97,606	$ 94,903
Requirement for Capital Adequacy Purposes, Ratio	4.50%	4.50%
To be Well Capitalized Under Prompt Corrective Action Provisions, Amount	$ 140,986	$ 137,083
To be Well Capitalized Under Prompt Corrective Action Provisions, Ratio	6.50%	6.50%
Total risk based capital ratio
Actual, Amount	$ 288,360	$ 290,185
Actual, Ratio	0.1329	0.1376
Requirement for Capital Adequacy Purposes, Amount	$ 173,521	$ 168,717
Requirement for Capital Adequacy Purposes, Ratio	0.080	0.080
To be Well Capitalized Under Prompt Corrective Action Provisions, Amount	$ 216,901	$ 210,897
To be Well Capitalized Under Prompt Corrective Action Provisions, Ratio	0.100	0.100
Tier 1 risk based capital ratio
Actual, Amount	$ 265,224	$ 268,041
Actual, Ratio	0.1223	0.1271
Requirement for Capital Adequacy Purposes, Amount	$ 130,141	$ 126,538
Requirement for Capital Adequacy Purposes, Ratio	0.060	0.060
To be Well Capitalized Under Prompt Corrective Action Provisions, Amount	$ 173,521	$ 168,717
To be Well Capitalized Under Prompt Corrective Action Provisions, Ratio	0.080	0.080
Tier 1 leverage ratio
Actual, Amount	$ 265,224	$ 268,041
Actual, Ratio	0.0825	0.0910
Requirement for Capital Adequacy Purposes, Amount	$ 128,647	$ 117,877
Requirement for Capital Adequacy Purposes, Ratio	0.040	0.040
To be Well Capitalized Under Prompt Corrective Action Provisions, Amount	$ 160,809	$ 147,346
To be Well Capitalized Under Prompt Corrective Action Provisions, Ratio	0.050	0.050

XML

Segment Information (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020	Dec. 31, 2020
Segment Reporting Information [Line Items]
Goodwill and other intangibles	$ 48,670		$ 48,670		$ 49,617
Total assets	3,317,047		3,317,047		3,071,148
Net interest income	26,534	$ 24,165	78,291	$ 70,388
Provision for credit losses and unfunded loans	(948)	2,600	(473)	6,100
Service fees, security gains and other noninterest income	9,015	9,217	28,706	25,662
Noninterest expense	16,300	16,682	49,136	51,069
Amortization and depreciation expense	828	788	2,430	2,317
INCOME BEFORE INCOME TAXES	19,369	13,312	55,904	36,564
Income taxes	3,358	2,443	9,762	6,045
NET INCOME	16,011	10,869	46,142	30,519
Eliminations And Others
Segment Reporting Information [Line Items]
Goodwill and other intangibles	(3,558)		(3,558)		(3,558)
Total assets	3,328		3,328		373
Net interest income	(295)	(63)	(400)	(247)
Provision for credit losses and unfunded loans	0	0	0	0
Service fees, security gains and other noninterest income	(77)	(64)	(128)	(346)
Noninterest expense	(12)	63	(409)	634
Amortization and depreciation expense	108	68	244	184
INCOME BEFORE INCOME TAXES	(468)	(258)	(363)	(1,411)
Income taxes	(150)	(120)	(286)	(476)
NET INCOME	(318)	(138)	(77)	(935)
Trust Segment | Operating Segments
Segment Reporting Information [Line Items]
Goodwill and other intangibles	5,872		5,872		6,046
Total assets	14,732		14,732		15,147
Net interest income	31	31	94	95
Provision for credit losses and unfunded loans	0	0	0	0
Service fees, security gains and other noninterest income	2,707	2,357	8,108	6,922
Noninterest expense	1,726	1,507	4,818	4,549
Amortization and depreciation expense	67	88	194	228
INCOME BEFORE INCOME TAXES	945	793	3,190	2,240
Income taxes	198	166	669	470
NET INCOME	747	627	2,521	1,770
Bank Segment | Operating Segments
Segment Reporting Information [Line Items]
Goodwill and other intangibles	46,356		46,356		47,129
Total assets	3,298,987		3,298,987		$ 3,055,628
Net interest income	26,798	24,197	78,597	70,540
Provision for credit losses and unfunded loans	(948)	2,600	(473)	6,100
Service fees, security gains and other noninterest income	6,385	6,924	20,726	19,086
Noninterest expense	14,586	15,112	44,727	45,886
Amortization and depreciation expense	653	632	1,992	1,905
INCOME BEFORE INCOME TAXES	18,892	12,777	53,077	35,735
Income taxes	3,310	2,397	9,379	6,051
NET INCOME	$ 15,582	$ 10,380	$ 43,698	$ 29,684

XML

Short-term borrowings (Details Textual)	Sep. 30, 2021 USD ($)	Dec. 31, 2020 USD ($) Institution
Short Term Debt [Line Items]
Securities sold under repurchase agreements	$ 0	$ 2,200,000
Business line of credit	$ 0	$ 350,000
Number of lending institutions | Institution		1
US Treasury and Government Short-term Debt Securities
Short Term Debt [Line Items]
Securities sold under repurchase agreements		$ 2,300,000
Pledged securities, percentage of repurchase agreement balances	105.00%

XML

Long-term borrowings (Details Textual) - USD ($) $ in Millions	9 Months Ended
	Sep. 30, 2021	Dec. 31, 2020
Debt Instrument [Line Items]
Long-term Federal Home Loan Bank Advances	$ 40.0	$ 67.0
Long-term investments	$ 9.6	$ 9.4
Debenture maturity date	Dec. 31, 2036
Weighted average interest rate of debentures	1.89%	1.99%
Additional borrowing limit	$ 579.9
Weighted Average | Long-term Debt
Debt Instrument [Line Items]
Weighted average interest rate	1.79%	1.39%