Variable Interest Entities

9 Months Ended

Sep. 30, 2023

Variable Interest Entity [Abstract]

Variable Interest Entity (Text Block Disclosure]

NOTE 3: VARIABLE INTEREST ENTITIES

Generally, a variable interest entity (“VIE”) is a corporation, partnership, trust or other legal structure that does not have

equity investors with substantive or proportional voting rights or has equity investors that do not provide sufficient financial

resources for the entity to support its activities. 

At September 30, 2023, the Company did not have any consolidated VIEs to disclose but did have one nonconsolidated

VIE, discussed below.

New Markets Tax Credit Investment

The New Markets Tax Credit (“NMTC”) program provides federal tax incentives to investors to make investments in

distressed communities and promotes economic improvement through the development of successful businesses in these

communities. The NMTC is available to investors over seven years and is subject to recapture if certain events occur

during such period. At September 30, 2023 and December 31, 2022, respectively, the Company had one such investment in

the amounts of $1.8 million and $2.1 million, respectively, which was included in other assets in the consolidated balance

sheets. The Company’s equity investment in the NMTC entity meets the definition of a VIE. While the Company’s

investment exceeds 50% of the outstanding equity interests, the Company does not consolidate the VIE because it does not

meet the characteristics of a primary beneficiary since the Company lacks the power to direct the activities of the VIE.

(Dollars in thousands)

Maximum

Loss Exposure

Asset Recognized

Classification

Type:

New Markets Tax Credit investment

$

1,807

$

1,807

Other assets