XML 32 R13.htm IDEA: XBRL DOCUMENT v3.22.4
Loans
 12 Months Ended
Dec. 31, 2022
Loans and Leases Receivable Disclosure [Abstract]  
Loans Loans
The composition of the loan portfolio at December 31, 2022 and December 31, 2021 was as follows:
 
December 31, 2022December 31, 2021
(In thousands)Amortized CostAmortized Cost
Commercial, financial and agricultural: (1)
Commercial, financial and agricultural (1)
$1,295,238 $1,223,079 
PPP loans4,206 74,420 
Overdrafts1,489 1,127 
Commercial real estate (1)
1,794,054 1,801,792 
Construction real estate:
Commercial208,982 214,561 
Retail116,433 107,225 
Residential real estate: 
Commercial550,183 533,802 
Mortgage1,075,446 1,033,658 
HELOC167,151 165,605 
Installment4,091 5,642 
Consumer:
Consumer1,902,557 1,685,793 
GFSC274 1,793 
Check loans2,150 2,093 
Leases19,637 20,532 
Total$7,141,891 $6,871,122 
Allowance for credit losses(85,379)(83,197)
Net loans$7,056,512 $6,787,925 
(1) Included within each of commercial, financial and agricultural loans and commercial real estate loans is an immaterial amount of consumer loans that were not broken out by class.

In order to support customers, Park participated in the CARES Act Paycheck Protection Program ("PPP"). For its assistance in originating the first round of PPP loans during 2020, Park received an aggregate of $20.2 million in fees from the SBA, and for its assistance in originating additional PPP loans during 2021, Park received an aggregate of $12.9 million in fees from the SBA. During the years ended December 31, 2022, December 31, 2021, and December 31, 2020, $3.0 million, $16.3 million, and $13.7 million, respectively, of PPP fee income was recognized within loan interest income.

Loans are shown net of deferred origination fees, costs and unearned income of $18.2 million at December 31, 2022, and of $19.5 million at December 31, 2021, which represented a net deferred income position in both years. At December 31, 2022 and December 31, 2021, included in the net deferred origination fees, costs and unearned income were $68,000 and $2.8 million, respectively, in net origination fees related to PPP loans. At December 31, 2022 and December 31, 2021, loans included purchase accounting adjustments of $2.5 million and $4.2 million, respectively, which represented a net deferred income position at each date. This fair market value purchase accounting adjustment is expected to be recognized into interest income on a level yield basis over the remaining expected life of the loans.

Overdrawn deposit accounts of $1.5 million and $1.1 million were reclassified to loans at December 31, 2022 and December 31, 2021, respectively.
Credit Quality
The following tables present the amortized cost of nonaccrual loans, accruing TDRs, and loans past due 90 days or more and still accruing, by class of loan, at December 31, 2022 and December 31, 2021:
 
 December 31, 2022
(In thousands)Nonaccrual
Loans		Accruing
TDRs		Loans Past Due
90 Days
 or More
and Accruing		Total
Nonperforming
Loans
Commercial, financial and agricultural:
Commercial, financial and agricultural$38,158 $3,261 $— $41,419 
PPP loans— — 389 389 
Overdrafts— — — — 
Commercial real estate24,504 7,919 — 32,423 
Construction real estate:
Commercial1,712 — — 1,712 
Retail1,254 12 — 1,266 
Residential real estate:
Commercial1,894 298 — 2,192 
Mortgage9,260 6,750 182 16,192 
HELOC1,133 187 7 1,327 
Installment51 1,037 — 1,088 
Consumer:
Consumer1,012 670 703 2,385 
GFSC10 — — 10 
Check loans— — — — 
Leases708 — — 708 
Total loans$79,696 $20,134 $1,281 $101,111 

 
 December 31, 2021
(In thousands)Nonaccrual
Loans		Accruing
TDRs		Loans Past Due 90 Days or More and AccruingTotal
Nonperforming
Loans
Commercial, financial and agricultural
Commercial, financial and agricultural$13,271 $9,396 $— $22,667 
PPP loans— — 793 793 
Overdrafts— — — — 
Commercial real estate40,142 7,713 — 47,855 
Construction real estate:   
Commercial52 169 — 221 
Mortgage7169 — 725 
Residential real estate:    
Commercial2,366 240 — 2,606 
Mortgage11,718 7,779 372 19,869 
HELOC1,590 803 — 2,393 
Installment82 1,508 — 1,590 
Consumer
Consumer1,518 700 431 2,649 
GFSC79 6 11 96 
Check loans— — — — 
Leases1,188 — — 1,188 
Total loans$72,722 $28,323 $1,607 $102,652 
The following tables provide additional detail on nonaccrual loans and the related ACL, by class of loan, at December 31, 2022 and December 31, 2021:

December 31, 2022
(In thousands)Nonaccrual Loans With No ACLNonaccrual Loans With an ACLRelated ACL
Commercial, financial and agricultural:
Commercial, financial and agricultural$28,291 $9,867 $3,440 
PPP loans— — — 
Overdrafts— — — 
Commercial real estate22,965 1,539 130 
Construction real estate:
Commercial1,712 — — 
Retail— 1,254 19 
Residential real estate:
Commercial1,894 — — 
Mortgage— 9,260 85 
HELOC— 1,133 191 
Installment— 51 17 
Consumer
Consumer— 1,012 283 
GFSC— 10 1 
Check loans— — — 
Leases680 28 9 
Total loans$55,542 $24,154 $4,175 
December 31, 2021
(In thousands)Nonaccrual Loans With No ACLNonaccrual Loans With an ACLRelated ACL
Commercial, financial and agricultural:
Commercial, financial and agricultural$11,494 $1,777 $1,343 
PPP loans— — — 
Overdrafts— — — 
Commercial real estate39,151 991 188 
Construction real estate:
Commercial52 — — 
Retail— 716 67 
Residential real estate:
Commercial2,366 — — 
Mortgage— 11,718 73 
HELOC— 1,590 99 
Installment— 82 24 
Consumer
Consumer— 1,518 393 
GFSC— 79 10 
Check loans— — — 
Leases914 274 43 
Total loans$53,977 $18,745 $2,240 

Nonaccrual commercial loans are evaluated on an individual basis and are excluded from the collective evaluation. Management’s general practice is to proactively charge down loans individually evaluated to the fair value of the underlying collateral. Nonaccrual consumer loans are collectively evaluated based on similar risk characteristics.

The following tables provide the amortized cost basis of collateral-dependent loans by class of loan, as of December 31, 2022 and December 31, 2021:

 December 31, 2022
(In thousands)Real EstateBusiness AssetsOtherTotal
Commercial, financial and agricultural
Commercial, financial and agricultural$8,242 $7,788 $23,125 $39,155 
Commercial real estate35,908 28 — 35,936 
Construction real estate:
Commercial2,372 — — 2,372 
Residential real estate:
Commercial2,479 — — 2,479 
Mortgage90 — — 90 
Leases— 708 — 708 
Total loans$49,091 $8,524 $23,125 $80,740 
 December 31, 2021
(In thousands)Real EstateBusiness AssetsOtherTotal
Commercial, financial and agricultural
Commercial, financial and agricultural$9,321 $13,366 $156 $22,843 
Commercial real estate52,901 37 — 52,938 
Construction real estate:
Commercial1,178 — — 1,178 
Residential real estate:
Commercial2,906 — 57 2,963 
Mortgage370 — — 370 
HELOC148 — — 148 
Leases— 1,211 — 1,211 
Total loans$66,824 $14,614 $213 $81,651 

Interest income on nonaccrual loans individually evaluated for impairment is recognized on a cash basis only when Park expects to receive the entire recorded investment in the loans. The following table presents interest income recognized on nonaccrual loans for the years ended December 31, 2022 and 2021:

Interest Income Recognized
(In thousands)December 31, 2022December 31, 2021
Commercial, financial and agricultural:
Commercial, financial and agricultural$438 $180 
PPP loans— — 
Overdrafts— — 
Commercial real estate956 1,844 
Construction real estate:
Commercial32 39 
Retail13 4 
Residential real estate:
Commercial88 204 
Mortgage157 301 
HELOC16 17 
Installment3 2 
Consumer:
Consumer54 92 
GFSC5 14 
Check loans
Leases33 73 
Total loans$1,795 $2,770 
The following table presents the average recorded investment and interest income recognized subsequent to impairment on loans individually evaluated for impairment as of and for the year ended December 31, 2020:

December 31, 2020
(In thousands)Recorded InvestmentAverage Recorded InvestmentInterest Income Recognized
Commercial, financial and agricultural$28,836 $30,280 $735 
Commercial real estate70,357 55,279 1,890 
Construction real estate:
   Commercial3,110 1,291 50 
Residential real estate:
   Commercial4,557 4,329 204 
Consumer— — — 
Leases1,595 1,115 — 
Total$108,455 $92,294 $2,879 

The following tables present the aging of the amortized cost in past due loans at December 31, 2022 and December 31, 2021 by class of loan:

 December 31, 2022
(In thousands)Accruing Loans
Past Due 30-89
Days
Past Due 
Nonaccrual
Loans and Loans Past
Due 90 Days or
More and 
Accruing (1)
Total Past Due
Total Current (2)
Total 
Amortized Cost
Commercial, financial and agricultural:
Commercial, financial and agricultural$378 $9,246 $9,624 $1,285,614 $1,295,238 
PPP loans155 389 544 3,662 4,206 
Overdrafts— — — 1,489 1,489 
Commercial real estate737 4,738 5,475 1,788,579 1,794,054 
Construction real estate:
Commercial751 — 751 208,231 208,982 
Retail1,035 523 1,558 114,875 116,433 
Residential real estate:
Commercial519 477 996 549,187 550,183 
Mortgage7,630 5,157 12,787 1,062,659 1,075,446 
HELOC832 587 1,419 165,732 167,151 
Installment57 4 61 4,030 4,091 
Consumer:
Consumer5,451 964 6,415 1,896,142 1,902,557 
GFSC48 — 48 226 274 
Check loans2 — 2 2,148 2,150 
Leases— — — 19,637 19,637 
Total loans$17,595 $22,085 $39,680 $7,102,211 $7,141,891 
(1) Includes an aggregate of $1.3 million of loans past due 90 days or more and accruing. The remaining loans were past due nonaccrual loans.
(2) Includes an aggregate of $58.9 million of nonaccrual loans which were current in regards to contractual principal and interest payments.
 December 31, 2021
(in thousands)Accruing Loans
Past Due 30-89
Days
Past Due 
Nonaccrual
Loans and Loans Past
Due 90 Days or
More and 
Accruing (1)
Total Past Due
Total Current (2)
Total 
Amortized Cost
Commercial, financial and agricultural
Commercial, financial and agricultural$2,908 $9,547 $12,455 $1,210,624 $1,223,079 
PPP loans242 793 1,035 73,385 74,420 
Overdrafts— — — 1,127 1,127 
Commercial real estate65 1,461 1,526 1,800,266 1,801,792 
Construction real estate:
Commercial— — — 214,561 214,561 
Mortgage346 660 1,006 106,219 107,225 
Residential real estate:
Commercial283 438 721 533,081 533,802 
Mortgage6,170 5,933 12,103 1,021,555 1,033,658 
HELOC565 1,011 1,576 164,029 165,605 
Installment49 31 80 5,562 5,642 
Consumer
Consumer2,614 618 3,232 1,682,561 1,685,793 
GFSC153 52 205 1,588 1,793 
Check loans10 — 10 2,083 2,093 
Leases60 526 586 19,946 20,532 
Total loans$13,465 $21,070 $34,535 $6,836,587 $6,871,122 
(1) Includes an aggregate of $1.6 million of loans past due 90 days or more and accruing. The remaining loans were past due nonaccrual loans.
(2) Includes an aggregate of $53.3 million of nonaccrual loans which were current in regards to contractual principal and interest payments.

Credit Quality Indicators
Management utilizes past due information as a credit quality indicator across the loan portfolio. Past due information at December 31, 2022 and December 31, 2021 is included in the previous tables. The past due information is the primary credit quality indicator within the following classes of loans: (1) overdrafts in the commercial, financial and agricultural portfolio segment; (2) retail loans in the construction real estate portfolio segment; (3) mortgage loans, HELOC and installment loans in the residential real estate portfolio segment; and (4) consumer loans, GFSC loans, and check loans in the consumer portfolio segment. The primary credit indicator for commercial loans is based on an internal grading system that grades all commercial loans on a scale from 1 to 8. Credit grades are continuously monitored by the responsible loan officer and adjustments are made when appropriate. A grade of 1 indicates little or no credit risk and a grade of 8 is considered a loss. Commercial loans that are pass-rated (graded an 1 through a 4) are considered to be of acceptable credit risk. Commercial loans graded a 5 (special mention) are considered to be watch list credits and a higher PD is applied to these loans. Loans classified as special mention have potential weaknesses that require management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or of Park’s credit position at some future date. Commercial loans graded a 6 (substandard), also considered watch list credits, are considered to represent higher credit risk and, as a result, a higher PD is applied to these loans. Loans classified as substandard are inadequately protected by the current sound worth and paying capacity of the obligor or the value of the collateral pledged, if any. Loans so classified have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that Park will sustain some loss if the deficiencies are not corrected. Commercial loans graded a 7 (doubtful) are shown as nonaccrual and Park generally charges these loans down to their fair value by taking a partial charge-off or recording a specific reserve. 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. Certain 6-rated loans and all 7-rated loans are placed on nonaccrual status and included within the individually evaluated category. A loan is deemed impaired, and is individually evaluated, when management determines the borrower's ability to perform in accordance with the contractual loan agreement is in doubt. Any commercial loan graded an 8 (loss) is completely charged off.
Based on the most recent analysis performed, the risk category of loans by class of loans as of December 31, 2022 and December 31, 2021 were as follows:

December 31, 2022Term Loans Amortized Cost Basis by Origination Year
(In thousands)20222021202020192018PriorRevolving Loans Amortized Cost BasisTotal
Commercial, financial and agricultural: Commercial, financial and agricultural (1)
Risk rating
Pass$197,497 $198,999 $142,487 $60,845 $32,887 $47,135 $546,237 $1,226,087 
Special Mention700 313 918 315 4 35 25,536 27,821 
Substandard1,101 18 2,737 226 1,836 8,424 26,464 40,806 
Doubtful— — 3 77 80 172 192 524 
Total $199,298 $199,330 $146,145 $61,463 $34,807 $55,766 $598,429 $1,295,238 
Commercial, financial and agricultural: PPP
Risk rating
Pass$— $1,875 $2,331 $— $— $— $— $4,206 
Special Mention— — — — — — — — 
Substandard— — — — — — — — 
Doubtful— — — — — — — — 
Total$— $1,875 $2,331 $— $— $— $— $4,206 
Commercial real estate (1)
Risk rating
Pass$323,235 $374,763 $372,653 $220,072 $107,467 $305,539 $14,052 $1,717,781 
Special Mention199 3,256 3,388 5,863 16,059 22,220 150 51,135 
Substandard7,856 1,427 3,007 3,561 856 5,471 428 22,606 
Doubtful— — — — 1,941 591 — 2,532 
Total$331,290 $379,446 $379,048 $229,496 $126,323 $333,821 $14,630 $1,794,054 
Construction real estate: Commercial
Risk rating
Pass$107,976 $40,534 $21,556 $2,686 $1,428 $3,015 $29,183 $206,378 
Special Mention— — 232 — — — — 232 
Substandard652 800 260 — 660 — — 2,372 
Doubtful— — — — — — — — 
Total$108,628 $41,334 $22,048 $2,686 $2,088 $3,015 $29,183 $208,982 
Residential Real Estate: Commercial
Risk rating
Pass$107,086 $120,303 $147,802 $56,980 $33,140 $63,499 $15,191 $544,001 
Special Mention— 92 1,477 440 — 1,625 — 3,634 
Substandard610 449 264 29 304 553 339 2,548 
Doubtful— — — — — — — — 
Total$107,696 $120,844 $149,543 $57,449 $33,444 $65,677 $15,530 $550,183 
Leases
Risk rating
Pass$7,629 $3,310 $3,347 $1,167 $981 $605 $— $17,039 
Special Mention1,085 614 130 60 — — — 1,889 
Substandard— — 464 111 12 26 — 613 
Doubtful— — — 96 — — — 96 
Total$8,714 $3,924 $3,941 $1,434 $993 $631 $— $19,637 
December 31, 2022Term Loans Amortized Cost Basis by Origination Year
(In thousands)20222021202020192018PriorRevolving Loans Amortized Cost BasisTotal
Total Commercial Loans
Risk rating
Pass$743,423 $739,784 $690,176 $341,750 $175,903 $419,793 $604,663 $3,715,492 
Special Mention1,984 4,275 6,145 6,678 16,063 23,880 25,686 84,711 
Substandard10,219 2,694 6,732 3,927 3,668 14,474 27,231 68,945 
Doubtful— — 3 173 2,021 763 192 3,152 
Total$755,626 $746,753 $703,056 $352,528 $197,655 $458,910 $657,772 $3,872,300 
(1) Included within each of commercial, financial and agricultural loans and commercial real estate loans is an immaterial amount of consumer loans that are not broken out by class.

December 31, 2021Term Loans Amortized Cost Basis by Origination Year
(In thousands)20212020201920182017PriorRevolving Loans Amortized Cost BasisTotal
Commercial, financial and agricultural: Commercial, financial and agricultural (1)
Risk rating
Pass$267,016 $208,078 $100,736 $52,705 $36,528 $59,909 $468,749 $1,193,721 
Special Mention1,608 1,592 429 59 277 — 11,986 15,951 
Substandard106 906 401 1,345 549 7,818 484 11,609 
Doubtful— 30 465 227 463 125 488 1,798 
Total $268,730 $210,606 $102,031 $54,336 $37,817 $67,852 $481,707 $1,223,079 
Commercial, financial and agricultural: PPP
Risk rating
Pass$69,588 $4,832 $— $— $— $— $— $74,420 
Special Mention— — — — — — — — 
Substandard— — — — — — — — 
Doubtful— — — — — — — — 
Total$69,588 $4,832 $— $— $— $— $— $74,420 
Commercial real estate (1)
Risk rating
Pass$376,468 $445,780 $263,786 $154,637 $115,571 $317,371 $14,890 $1,688,503 
Special Mention786 6,206 32,965 9,354 4,297 17,829 996 72,433 
Substandard3,897 2,578 1,385 11,373 5,967 14,541 450 40,191 
Doubtful— — — — 47 618 — 665 
Total$381,151 $454,564 $298,136 $175,364 $125,882 $350,359 $16,336 $1,801,792 
Construction real estate: Commercial
Risk rating
Pass$96,929 $76,867 $7,003 $4,841 $1,856 $3,412 $22,444 $213,352 
Special Mention202 — — 691 — — — 893 
Substandard— 52 — 264 — — — 316 
Doubtful— — — — — — — — 
Total$97,131 $76,919 $7,003 $5,796 $1,856 $3,412 $22,444 $214,561 
Residential Real Estate: Commercial
Risk rating
Pass$138,801 $165,202 $67,921 $44,896 $26,583 $70,434 $15,507 $529,344 
Special Mention95 884 106 79 — 497 135 1,796 
Substandard735 22 691 41 95 993 29 2,606 
Doubtful56 — — — — — — 56 
Total$139,687 $166,108 $68,718 $45,016 $26,678 $71,924 $15,671 $533,802 
December 31, 2021Term Loans Amortized Cost Basis by Origination Year
(In thousands)20212020201920182017PriorRevolving Loans Amortized Cost BasisTotal
Leases
Risk rating
Pass$6,705 $5,729 $2,628 $2,151 $705 $845 $— $18,763 
Special Mention198 111 184 67 21 — — 581 
Substandard— 698 — 23 19 78 — 818 
Doubtful— — 332 16 22 — — 370 
Total$6,903 $6,538 $3,144 $2,257 $767 $923 $— $20,532 
Total Commercial Loans
Risk rating
Pass$955,507 $906,488 $442,074 $259,230 $181,243 $451,971 $521,590 $3,718,103 
Special Mention2,889 8,793 33,684 10,250 4,595 18,326 13,117 91,654 
Substandard4,738 4,256 2,477 13,046 6,630 23,430 963 55,540 
Doubtful56 30 797 243 532 743 488 2,889 
Total$963,190 $919,567 $479,032 $282,769 $193,000 $494,470 $536,158 $3,868,186 
(1) Included within each of commercial, financial and agricultural loans and commercial real estate loans is an immaterial amount of consumer loans that are not broken out by class.
 
Park considers the performance of the loan portfolio and its impact on the allowance for credit losses. For residential and consumer loan classes, Park also evaluates credit quality based on the aging status of the loan, which was previously presented, and by performing status. The following tables present the amortized cost in residential and consumer loans based on performing status. Park defines a loan as nonperforming if it is on nonaccrual status, designated as an accruing TDR, or is greater than 90 days past due and accruing.

December 31, 2022Term Loans Amortized Cost Basis by Origination Year
(In thousands)20222021202020192018PriorRevolving Loans Amortized Cost BasisTotal
Commercial, financial and agricultural: Overdrafts
Performing$1,489 $— $— $— $— $— $— $1,489 
Nonperforming— — — — — — — — 
Total $1,489 $— $— $— $— $— $— $1,489 
Construction Real Estate: Retail
Performing$71,923 $26,134 $8,218 $4,619 $1,618 $2,580 $75 $115,167 
Nonperforming731 — 523 — — 12 — 1,266 
Total $72,654 $26,134 $8,741 $4,619 $1,618 $2,592 $75 $116,433 
Residential Real Estate: Mortgage
Performing$207,093 $227,131 $192,904 $90,014 $55,648 $286,464 $— $1,059,254 
Nonperforming— — 700 650 518 14,324 — 16,192 
Total $207,093 $227,131 $193,604 $90,664 $56,166 $300,788 $— $1,075,446 
Residential Real Estate: HELOC
Performing$140 $299 $23 $130 $141 $1,957 $163,134 $165,824 
Nonperforming— — 43 100 — 999 185 1,327 
Total $140 $299 $66 $230 $141 $2,956 $163,319 $167,151 
Residential Real Estate: Installment
Performing$187 $— $1 $241 $62 $2,512 $— $3,003 
Nonperforming— — 7 2 16 1,063 — 1,088 
Total $187 $— $8 $243 $78 $3,575 $— $4,091 
December 31, 2022Term Loans Amortized Cost Basis by Origination Year
(In thousands)20222021202020192018PriorRevolving Loans Amortized Cost BasisTotal
Consumer: Consumer
Performing$823,484 $462,014 $333,336 $150,237 $61,174 $65,612 $4,315 $1,900,172 
Nonperforming440 489 424 355 157 520 — 2,385 
Total $823,924 $462,503 $333,760 $150,592 $61,331 $66,132 $4,315 $1,902,557 
Consumer: GFSC
Performing$— $— $55 $111 $45 $2 $51 $264 
Nonperforming— — — 10 — — — 10 
Total $— $— $55 $121 $45 $2 $51 $274 
Consumer: Check loans
Performing$— $— $— $— $— $— $2,150 $2,150 
Nonperforming— — — — — — — — 
Total $— $— $— $— $— $— $2,150 $2,150 
Total Consumer Loans
Performing$1,104,316 $715,578 $534,537 $245,352 $118,688 $359,127 $169,725 $3,247,323 
Nonperforming
1,171 489 1,697 1,117 691 16,918 185 22,268 
Total $1,105,487 $716,067 $536,234 $246,469 $119,379 $376,045 $169,910 $3,269,591 
December 31, 2021Term Loans Amortized Cost Basis by Origination Year
(In thousands)20212020201920182017PriorRevolving Loans Amortized Cost BasisTotal
Commercial, financial and agricultural: Overdrafts
Performing$1,127 $— $— $— $— $— $— $1,127 
Nonperforming— — — — — — — — 
Total $1,127 $— $— $— $— $— $— $1,127 
Construction Real Estate: Retail
Performing$68,374 $26,247 $5,710 $2,743 $1,505 $1,842 $79 $106,500 
Nonperforming— 647 57 — — 21 — 725 
Total $68,374 $26,894 $5,767 $2,743 $1,505 $1,863 $79 $107,225 
Residential Real Estate: Mortgage
Performing$230,299 $217,022 $114,077 $68,774 $59,939 $323,678 $— $1,013,789 
Nonperforming— 626 785 824 574 17,060 — 19,869 
Total $230,299 $217,648 $114,862 $69,598 $60,513 $340,738 $— $1,033,658 
Residential Real Estate: HELOC
Performing$400 $— $121 $58 $41 $2,640 $159,952 $163,212 
Nonperforming89 40 — 37 90 1,811 326 2,393 
Total $489 $40 $121 $95 $131 $4,451 $160,278 $165,605 
Residential Real Estate: Installment
Performing$— $3 $418 $111 $1,049 $2,471 $— $4,052 
Nonperforming— 12 5 26 78 1,469 — 1,590 
Total $— $15 $423 $137 $1,127 $3,940 $— $5,642 
Consumer: Consumer
Performing$649,638 $505,555 $259,230 $119,222 $64,699 $62,136 $22,664 $1,683,144 
Nonperforming241 506 755 399 155 593 — 2,649 
Total $649,879 $506,061 $259,985 $119,621 $64,854 $62,729 $22,664 $1,685,793 
December 31, 2021Term Loans Amortized Cost Basis by Origination Year
(In thousands)20212020201920182017PriorRevolving Loans Amortized Cost BasisTotal
Consumer: GFSC
Performing$— $243 $986 $292 $63 $5 $108 $1,697 
Nonperforming— 9 73 5 9 — — 96 
Total $— $252 $1,059 $297 $72 $5 $108 $1,793 
Consumer: Check loans
Performing$— $— $— $— $— $— $2,093 $2,093 
Nonperforming— — — — — — — — 
Total $— $— $— $— $— $— $2,093 $2,093 
Total Consumer Loans
Performing$949,838 $749,070 $380,542 $191,200 $127,296 $392,772 $184,896 $2,975,614 
Nonperforming
330 1,840 1,675 1,291 906 20,954 326 27,322 
Total $950,168 $750,910 $382,217 $192,491 $128,202 $413,726 $185,222 $3,002,936 

Loans and Leases Acquired with Deteriorated Credit Quality
In conjunction with the NewDominion acquisition, Park acquired loans with a book value of $277.9 million as of the July 1, 2018 acquisition date. These loans were recorded at the initial fair value of $272.8 million. NewDominion loans acquired with deteriorated credit quality (ASC 310-30) with a book value of $5.1 million were recorded at the initial fair value of $4.9 million. In conjunction with the Carolina Alliance acquisition, Park acquired loans and leases with a book value of $589.7 million as of the April 1, 2019 acquisition date. Carolina Alliance loans and leases were recorded at the initial fair value of $578.6 million. Loans and leases acquired with deteriorated credit quality (ASC 310-30) with a book value of $19.9 million were recorded at the initial fair value of $18.4 million.

Upon adoption of CECL on January 1, 2021, $52,000 of the credit discount on PCD loans was reclassified to the allowance for credit losses. PCD loans are individually evaluated on a quarterly basis to determine if a specific reserve is necessary. At each of December 31, 2022 and December 31, 2021, there was no allowance for credit losses on PCD loans. The carrying amount of loans acquired with deteriorated credit quality at December 31, 2022 and December 31, 2021 was $4.7 million and $7.1 million, respectively.

Troubled Debt Restructurings
Management typically classifies loans as TDRs when a borrower is experiencing financial difficulties and Park has granted a concession to the borrower as part of a modification or in the loan renewal process. In order to determine whether a borrower is experiencing financial difficulty, an evaluation is performed of the probability that the borrower will be in payment default on any of the borrower's debt in the foreseeable future without the modification. This evaluation is performed in accordance with the Company’s internal underwriting policy. Management’s policy is to modify loans by extending the term or by granting a temporary or permanent contractual interest rate below the market rate, not by forgiving debt. A court's discharge of a borrower's debt in a Chapter 7 bankruptcy is considered a concession when the borrower does not reaffirm the discharged debt.

In response to the COVID-19 pandemic, Park worked with borrowers and provided modifications in the form of either interest only deferral or principal and interest deferral, in each case, for initial periods of up to 90 days. As necessary, Park made available a second 90-day interest only deferral or principal and interest deferral bringing the total potential deferral period to six months. Modifications were structured in a manner to best address each individual customer's then current situation. A majority of these modifications were excluded from the TDR classification under Section 4013 of the CARES Act or under applicable interagency guidance of the federal banking regulators. The modified loans were considered current and continued to accrue interest during the deferral period. Section 4013 of the CARES Act expired on December 31, 2021; therefore, modifications occurring after that date are subject to previous TDR classification guidance. As of December 31, 2022, there were no loans which were still within the COVID-19 deferral period.

Certain loans which were modified during the years ended December 31, 2022 and 2021 did not meet the definition of a TDR as the modification was a delay in a payment that was considered to be insignificant. Management considers a forbearance period of up to three months or a delay in payment of up to 30 days to be insignificant. TDRs may be classified as accruing if the borrower has been current for a period of at least six months with respect to loan payments and management expects that the
borrower will be able to continue to make payments in accordance with the terms of the restructured note. Management reviews all accruing TDRs quarterly to ensure payments continue to be made in accordance with the modified terms.
There were $29.6 million of substandard commercial loans modified during the year ended December 31, 2022 that did not meet the definition of a TDR. Excluding COVID-19 related modifications, there were $0.2 million of substandard commercial loans modified during the year ended December 31, 2021 that did not meet the definition of a TDR. Consumer loans modified during 2022, which did not meet the definition of a TDR, had a total amortized cost at December 31, 2022 of $41.7 million. Excluding COVID-19 related modifications, consumer loans modified during 2021, which did not meet the definition of a TDR, had a total amortized cost at December 31, 2021 of $32.9 million. Many of these loans were to borrowers who were not experiencing financial difficulties but who were looking to reduce their cost of funds.

At December 31, 2022 and 2021, there were $17.5 million and $20.9 million, respectively, of TDRs included in the nonaccrual loan totals. At December 31, 2022 and 2021, $7.5 million and $10.5 million, respectively, of these nonaccrual TDRs were performing in accordance with the terms of the restructured notes. At December 31, 2022 and 2021, loans totaling $20.1 million and $28.3 million, respectively, were included in accruing TDR loan totals. Management will continue to review the restructured loans and may determine it is appropriate to move certain nonaccrual TDRs to accrual status in the future.

At December 31, 2022 and 2021, Park had commitments to lend $1.6 million and $3.0 million, respectively, of additional funds to borrowers whose outstanding loan terms had been modified in a TDR.

At December 31, 2022 and 2021, there were $2.2 million and $0.3 million, respectively, of specific reserves related to TDRs. Modifications made in 2022 and 2021 were largely the result of renewals and extending the maturity date of the loans at terms consistent with the original notes. These modifications were deemed to be TDRs primarily due to Park’s conclusion that the borrower would likely not have qualified for similar terms through another lender. Many of the modifications deemed to be TDRs were previously identified as individually evaluated loans, and thus were also previously evaluated for impairment under ASC 310. Additional specific reserves of $0.9 million were recorded during the year ended December 31, 2022, as a result of TDRs identified in the 2022 year. Additional specific reserves of $0.2 million were recorded during the year ended December 31, 2021, as a result of TDRs identified in the 2021 year. Additional specific reserves of $7,000 were recorded during the year ended December 31, 2020, as a result of TDRs identified in the 2020 year.

Quarterly, management reviews renewals/modifications of loans previously identified as TDRs to consider if it is appropriate to remove the TDR classification. If the borrower is no longer experiencing financial difficulty and the renewal/modification did not contain a concessionary interest rate or other concessionary terms and the terms of the renewal/modification are considered to be market terms based on the current risk characteristics of the borrower, management considers the potential removal of the TDR classification. If deemed appropriate, the TDR classification is removed if the borrower has complied with the terms of the loan at the date of the renewal/modification and there was a reasonable expectation that the borrower will continue to comply with the terms of the loan subsequent to the date of the renewal/modification. The majority of these TDRs were originally considered restructurings in a prior year as a result of a renewal/modification with an interest rate that was not commensurate with the risk of the underlying loan at the time of the renewal/modification. During the years ended December 31, 2022 and 2021, Park removed the TDR classification on $1.0 million and $4.1 million, respectively, of loans that met the requirements discussed above.

The following tables detail the number of contracts modified as TDRs during the years ended December 31, 2022, 2021 and 2020 as well as the amortized cost/ recorded investment of these contracts at December 31, 2022, 2021, and 2020. The
amortized cost/ recorded investment pre- and post-modification is generally the same due to the fact that Park does not typically forgive principal.

Year ended December 31, 2022
(In thousands)Number of ContractsAccruingNonaccrualAmortized
Cost
Commercial, financial and agricultural
Commercial, financial and agricultural12$2,254 $3,484 $5,738 
PPP loans— — — — 
Overdrafts— — — — 
Commercial real estate9 1,040 813 1,853 
Construction real estate:
Commercial1 — 41 41 
   Retail1 — — — 
Residential real estate:
Commercial4 21 274 295 
Mortgage15 865 368 1,233 
HELOC3 — 11 11 
Installment12 141 27 168 
Consumer:
Consumer89 196 359 555 
GFSC— — — — 
Check loans— — — — 
Leases10 — 101 101 
Total loans156$4,517 $5,478 $9,995 

Year ended December 31, 2021
(In thousands)Number of ContractsAccruingNonaccrualAmortized Cost
Commercial, financial and agricultural
Commercial, financial and agricultural10 $1,356 $169 $1,525 
PPP loans—— — — 
Overdrafts—— — — 
Commercial real estate152,002 6,747 8,749 
Construction real estate:
Commercial1 — — — 
Retail2 — 705 705 
Residential real estate:
Commercial595 574 669 
Mortgage14146 396 542 
HELOC8211 105 316 
Installment8120 — 120 
Consumer:
Consumer131116 417 533 
GFSC—— — — 
Check loans—— — — 
Leases1— 325 325 
Total loans195$4,046 $9,438 $13,484 
Year ended December 31, 2020
(In thousands)Number of ContractsAccruingNonaccrualRecorded Investment
Commercial, financial and agricultural12$107 $3,706 $3,813 
Commercial real estate9— 3,235 3,235 
Construction real estate:
Commercial—— — — 
Mortgage1 26 — 26 
Installment1 — 14 14 
Residential real estate:
Commercial3153 3 156 
Mortgage27888 1,068 1,956 
HELOC714 52 66 
Installment18163 65 228 
Consumer214218 634 852 
Total loans292$1,569 $8,777 $10,346 
 
Of those loans which were modified and determined to be a TDR during the year ended December 31, 2022, $1.0 million were on nonaccrual status as of December 31, 2021. Of those loans which were modified and determined to be a TDR during the year ended December 31, 2021, $5.4 million were on nonaccrual status as of December 31, 2020. Of those loans which were modified and determined to be a TDR during the year ended December 31, 2020, $0.4 million were on nonaccrual status as of December 31, 2019.

The following table presents the amortized cost/ recorded investment in financing receivables which were modified as TDRs within the previous 12 months and for which there was a payment default during the year ended December 31, 2022, December 31, 2021, and December 31, 2020. For this table, a loan is considered to be in default when it becomes 30 days
contractually past due under the modified terms. The additional allowance for credit loss resulting from the defaults on TDR loans was immaterial.

 
Year ended December 31, 2022Year ended December 31, 2021Year ended December 31, 2020
(In thousands)Number of ContractsAmortized CostNumber of ContractsAmortized CostNumber of ContractsRecorded Investment
Commercial, financial and agricultural:4 $2,776 
Commercial, financial and agricultural5 $2,091 — $— (1)(1)
PPP loans— — — — (1)(1)
Overdrafts— — — — (1)(1)
Commercial real estate— — — — 1 223 
Construction real estate:
Commercial— — — — — — 
Retail— — 1 648 1 14 
Residential real estate:
Commercial1 93 — — 1 3 
Mortgage4 154 4 280 11 993 
HELOC1 10 2 135 — — 
Installment— — 1 27 3 32 
Consumer34 360 
Consumer19 174 14 169 (1)(1)
GFSC— — — — (1)(1)
Check loans— — — — (1)(1)
Leases— — — — — — 
Total loans30 $2,522 22 $1,259 55 $4,401 
(1) 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 U.S. GAAP. Category was not broken out as a separate class at December 31, 2020.

Of the $2.5 million in modified TDRs which defaulted during the year ended December 31, 2022, $2.0 million were accruing loans and $0.5 million were nonaccrual loans. Of the $1.3 million in modified TDRs which defaulted during the year ended December 31, 2021, $115,000 were accruing loans and $1.1 million were nonaccrual loans. Of the $4.4 million in modified TDRs which defaulted during the year ended December 31, 2020, $706,000 were accruing loans and $3.7 million were nonaccrual loans.
 
Certain of the Corporation’s executive officers, directors and related entities of directors are loan customers of PNB. As of December 31, 2022 and 2021, credit exposure aggregating approximately $37.3 million and $33.5 million, respectively, was outstanding to such parties. Of this total exposure, approximately $28.4 million and $27.1 million was outstanding at December 31, 2022 and 2021, respectively, with the remaining balance representing available credit. During 2022, new loans and advances on existing loans were made to these executive officers, directors and related entities of directors totaling $6.1 million and $1.2 million, respectively. These extensions of credit were offset by aggregate principal payments of $6.0 million. During 2021, new loans and advances on existing loans were $1.2 million and $9.7 million, respectively. These extensions of credit were offset by aggregate principal payments of $12.6 million and the removal of loans from the related party listing totaling $3.2 million.