Loans, Notes, Trade and Other Receivables Disclosure [Text Block] |
(4) | Loans and Allowance for Credit Losses on Loans |
Composition of loans by class follows:
(in thousands) | | September 30, 2022 | | | December 31, 2021 | |
| | | | | | | | |
Commercial real estate - non-owner occupied | | $ | 1,415,180 | | | $ | 1,128,244 | |
Commercial real estate - owner occupied | | | 819,727 | | | | 678,405 | |
Total commercial real estate | | | 2,234,907 | | | | 1,806,649 | |
| | | | | | | | |
Commercial and industrial - term | | | 751,193 | | | | 596,710 | |
Commercial and industrial - term - PPP | | | 19,469 | | | | 140,734 | |
Commercial and industrial - lines of credit | | | 419,048 | | | | 370,312 | |
Total commercial and industrial | | | 1,189,710 | | | | 1,107,756 | |
| | | | | | | | |
Residential real estate - owner occupied | | | 557,638 | | | | 400,695 | |
Residential real estate - non-owner occupied | | | 302,936 | | | | 281,018 | |
Total residential real estate | | | 860,574 | | | | 681,713 | |
| | | | | | | | |
Construction and land development | | | 414,632 | | | | 299,206 | |
Home equity lines of credit | | | 199,485 | | | | 138,976 | |
Consumer | | | 138,843 | | | | 104,294 | |
Leases | | | 13,959 | | | | 13,622 | |
Credits cards | | | 20,767 | | | | 17,087 | |
Total loans (1) | | $ | 5,072,877 | | | $ | 4,169,303 | |
(1) Total loans are presented inclusive of premiums, discounts and net loan origination fees and costs.
As a result of the CB acquisition on March 7, 2022, $632 million in loans (net of purchase accounting adjustments) were added to the portfolio.
Accrued interest on loans, which is excluded from the amortized cost of loans, totaled $13 million and $11 million at September 30, 2022 and December 31, 2021, respectively, and was included in the consolidated balance sheets.
Loans with carrying amounts of $2.72 billion and $2.20 billion were pledged to secure FHLB borrowing capacity at September 30, 2022 and December 31, 2021, respectively.
Loans to directors and their related interests, including loans to companies for which directors are principal owners and executive officers, totaled $73 million and $54 million as of September 30, 2022 and December 31, 2021, respectively.
PCD Loans
In connection with the acquisitions of CB on March 7, 2022, and KB on May 31, 2021, Bancorp acquired loans both with and without evidence of credit quality deterioration since origination. Acquired loans are recorded at their fair value at the time of acquisition with no carryover from the acquired institution’s previously recorded allowance for loan and lease losses. Acquired loans are accounted for under ASC 326, Financial Instruments – Credit Losses.
The fair value of acquired loans recorded at the time of acquisition is based upon several factors, including the timing and payment of expected cash flows, as adjusted for estimated credit losses and prepayments, and then discounting these cash flows using comparable market rates. The resulting fair value adjustment is recorded in the form of a premium or discount to the unpaid principal balance of the respective loans. As it relates to acquired loans that, as of the date of acquisition, have experienced a more-than-insignificant deterioration in credit quality since origination (“PCD”), the net premium or net discount is adjusted to reflect Bancorp’s allowance for credit losses recorded for PCD loans at the time of acquisition, and the remaining fair value adjustment is accreted or amortized into interest income over the remaining life of the respective loans. As it relates to loans not classified as PCD (“non-PCD”) loans, the credit loss and yield components of their fair value adjustment are aggregated, and the resulting net premium or net discount is accreted or amortized into interest income over the remaining life of the respective loans. Bancorp records an ACL for non-PCD loans at the time of acquisition through provision expense, and therefore, no further adjustments are made to the net premium or net discount for non-PCD loans.
Bancorp purchased loans through the acquisitions of CB and KB for which there was, at the time of acquisition, more-than-insignificant deterioration of credit quality since origination. The carrying amount of loans acquired and classified as PCD was as follows at the respective acquisition dates:
| | CB | | | KB | |
(in thousands) | | March 7, 2022 | | | May 31, 2021 | |
| | | | | | | | |
Purchase price of PCD loans at acquisition | | $ | 88,549 | | | $ | 32,765 | |
Allowance for credit losses at acquisition | | | (9,950 | ) | | | (6,757 | ) |
Non-credit discount at acquisition | | | (4,094 | ) | | | (735 | ) |
Fair value of PCD loans at acquisition | | $ | 74,505 | | | $ | 25,273 | |
At September 30, 2022, the book balance of PCD loans acquired as a result of the CB and KB acquisitions totaled $66 million and $13 million, respectively. Interest income recognized on loans classified as PCD totaled $1.1 million and $341,000 for the three month periods ended September 30, 2022 and 2021, respectively. For the nine month periods ended September 30, 2022 and 2021, interest income recognized on loans classified as PCD totaled $4.0 million and $450,000, respectively.
Allowance for Credit Losses on Loans
The table below reflects activity in the ACL related to loans:
(in thousands) | | Beginning | | | Initial Allowance on PCD | | | Provision for Credit Losses | | | | | | | | | Ending | |
Three Months Ended September 30, 2022 | | Balance | | | Loans | | | on Loans | | | Charge-offs | | | Recoveries | | | Balance | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Commercial real estate - non-owner occupied | | $ | 20,723 | | | $ | - | | | $ | 502 | | | $ | (37 | ) | | $ | - | | | $ | 21,188 | |
Commercial real estate - owner occupied | | | 9,842 | | | | - | | | | (227 | ) | | | - | | | | 153 | | | | 9,768 | |
Total commercial real estate | | | 30,565 | | | | - | | | | 275 | | | | (37 | ) | | | 153 | | | | 30,956 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Commercial and industrial - term | | | 12,342 | | | | - | | | | 2,055 | | | | (466 | ) | | | 232 | | | | 14,163 | |
Commercial and industrial - lines of credit | | | 5,000 | | | | - | | | | 203 | | | | (99 | ) | | | - | | | | 5,104 | |
Total commercial and industrial | | | 17,342 | | | | - | | | | 2,258 | | | | (565 | ) | | | 232 | | | | 19,267 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Residential real estate - owner occupied | | | 5,988 | | | | - | | | | 423 | | | | (17 | ) | | | 2 | | | | 6,396 | |
Residential real estate - non-owner occupied | | | 3,190 | | | | - | | | | 146 | | | | - | | | | 9 | | | | 3,345 | |
Total residential real estate | | | 9,178 | | | | - | | | | 569 | | | | (17 | ) | | | 11 | | | | 9,741 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Construction and land development | | | 6,214 | | | | - | | | | 731 | | | | - | | | | - | | | | 6,945 | |
Home equity lines of credit | | | 1,521 | | | | - | | | | 105 | | | | - | | | | - | | | | 1,626 | |
Consumer | | | 1,113 | | | | - | | | | 162 | | | | (307 | ) | | | 148 | | | | 1,116 | |
Leases | | | 221 | | | | - | | | | (10 | ) | | | - | | | | - | | | | 211 | |
Credit cards | | | 208 | | | | - | | | | 13 | | | | - | | | | - | | | | 221 | |
Total | | $ | 66,362 | | | $ | - | | | $ | 4,103 | | | $ | (926 | ) | | $ | 544 | | | $ | 70,083 | |
(in thousands) | | Beginning | | | Initial Allowance on PCD | | | Provision for Credit Losses | | | | | | | | | Ending | |
Nine Months Ended September 30, 2022 | | Balance | | | Loans | | | on Loans | | | Charge-offs | | | Recoveries | | | Balance | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Commercial real estate - non-owner occupied | | $ | 15,960 | | | $ | 3,508 | | | $ | 1,744 | | | $ | (37 | ) | | $ | 13 | | | $ | 21,188 | |
Commercial real estate - owner occupied | | | 9,595 | | | | 2,121 | | | | (2,103 | ) | | | (41 | ) | | | 196 | | | | 9,768 | |
Total commercial real estate | | | 25,555 | | | | 5,629 | | | | (359 | ) | | | (78 | ) | | | 209 | | | | 30,956 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Commercial and industrial - term | | | 8,577 | | | | 1,358 | | | | 3,796 | | | | (594 | ) | | | 1,026 | | | | 14,163 | |
Commercial and industrial - lines of credit | | | 4,802 | | | | 1,874 | | | | (1,437 | ) | | | (135 | ) | | | - | | | | 5,104 | |
Total commercial and industrial | | | 13,379 | | | | 3,232 | | | | 2,359 | | | | (729 | ) | | | 1,026 | | | | 19,267 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Residential real estate - owner occupied | | | 4,316 | | | | 590 | | | | 1,458 | | | | (30 | ) | | | 62 | | | | 6,396 | |
Residential real estate - non-owner occupied | | | 3,677 | | | | - | | | | (349 | ) | | | - | | | | 17 | | | | 3,345 | |
Total residential real estate | | | 7,993 | | | | 590 | | | | 1,109 | | | | (30 | ) | | | 79 | | | | 9,741 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Construction and land development | | | 4,789 | | | | 419 | | | | 1,809 | | | | (72 | ) | | | - | | | | 6,945 | |
Home equity lines of credit | | | 1,044 | | | | 2 | | | | 580 | | | | - | | | | - | | | | 1,626 | |
Consumer | | | 772 | | | | 78 | | | | 565 | | | | (796 | ) | | | 497 | | | | 1,116 | |
Leases | | | 204 | | | | - | | | | 7 | | | | - | | | | - | | | | 211 | |
Credit cards | | | 162 | | | | - | | | | 12 | | | | - | | | | 47 | | | | 221 | |
Total | | $ | 53,898 | | | $ | 9,950 | | | $ | 6,082 | | | $ | (1,705 | ) | | $ | 1,858 | | | $ | 70,083 | |
(in thousands) | | Beginning | | | Initial Allowance | | | Provision for Credit Losses | | | | | | | | | Ending | |
Three Months Ended September 30, 2021 | | Balance | | | on PCD Loans | | | on Loans | | | Charge-offs | | | Recoveries | | | Balance | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Commercial real estate - non-owner occupied | | $ | 19,747 | | | $ | - | | | $ | (3,582 | ) | | $ | - | | | $ | 6 | | | $ | 16,171 | |
Commercial real estate - owner occupied | | | 9,548 | | | | - | | | | 2,131 | | | | (1,361 | ) | | | - | | | | 10,318 | |
Total commercial real estate | | | 29,295 | | | | - | | | | (1,451 | ) | | | (1,361 | ) | | | 6 | | | | 26,489 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Commercial and industrial - term | | | 9,748 | | | | - | | | | 253 | | | | (240 | ) | | | 5 | | | | 9,766 | |
Commercial and industrial - lines of credit | | | 5,240 | | | | - | | | | (328 | ) | | | - | | | | - | | | | 4,912 | |
Total commercial and industrial | | | 14,988 | | | | - | | | | (75 | ) | | | (240 | ) | | | 5 | | | | 14,678 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Residential real estate - owner occupied | | | 4,350 | | | | - | | | | 420 | | | | (340 | ) | | | 27 | | | | 4,457 | |
Residential real estate - non-owner occupied | | | 3,422 | | | | - | | | | 106 | | | | - | | | | 2 | | | | 3,530 | |
Total residential real estate | | | 7,772 | | | | - | | | | 526 | | | | (340 | ) | | | 29 | | | | 7,987 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Construction and land development | | | 5,193 | | | | - | | | | 45 | | | | - | | | | - | | | | 5,238 | |
Home equity lines of credit | | | 1,230 | | | | - | | | | (173 | ) | | | - | | | | - | | | | 1,057 | |
Consumer | | | 572 | | | | - | | | | 145 | | | | (274 | ) | | | 284 | | | | 727 | |
Leases | | | 232 | | | | - | | | | (38 | ) | | | - | | | | - | | | | 194 | |
Credit cards | | | 142 | | | | - | | | | 21 | | | | - | | | | - | | | | 163 | |
Total | | $ | 59,424 | | | $ | - | | | $ | (1,000 | ) | | $ | (2,215 | ) | | $ | 324 | | | $ | 56,533 | |
(in thousands) | | Beginning | | | Initial ACL on Loans Purchased with Credit | | | Provision for Credit Losses | | | | | | | | | Ending | |
Nine Months Ended September 30, 2021 | | Balance | | | Deterioration | | | on Loans | | | Charge-offs | | | Recoveries | | | Balance | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Commercial real estate - non-owner occupied | | $ | 19,396 | | | $ | 1,491 | | | $ | (1,692 | ) | | $ | (3,065 | ) | | $ | 41 | | | $ | 16,171 | |
Commercial real estate - owner occupied | | | 6,983 | | | | 2,112 | | | | 2,029 | | | | (1,361 | ) | | | 555 | | | | 10,318 | |
Total commercial real estate | | | 26,379 | | | | 3,603 | | | | 337 | | | | (4,426 | ) | | | 596 | | | | 26,489 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Commercial and industrial - term | | | 8,970 | | | | 1,022 | | | | 156 | | | | (409 | ) | | | 27 | | | | 9,766 | |
Commercial and industrial - lines of credit | | | 3,614 | | | | 1,755 | | | | (457 | ) | | | - | | | | - | | | | 4,912 | |
Total commercial and industrial | | | 12,584 | | | | 2,777 | | | | (301 | ) | | | (409 | ) | | | 27 | | | | 14,678 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Residential real estate - owner occupied | | | 3,389 | | | | 142 | | | | 1,279 | | | | (383 | ) | | | 30 | | | | 4,457 | |
Residential real estate - non-owner occupied | | | 1,818 | | | | 88 | | | | 1,620 | | | | - | | | | 4 | | | | 3,530 | |
Total residential real estate | | | 5,207 | | | | 230 | | | | 2,899 | | | | (383 | ) | | | 34 | | | | 7,987 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Construction and land development | | | 6,119 | | | | - | | | | (884 | ) | | | - | | | | 3 | | | | 5,238 | |
Home equity lines of credit | | | 895 | | | | 147 | | | | 14 | | | | - | | | | 1 | | | | 1,057 | |
Consumer | | | 340 | | | | - | | | | 471 | | | | (561 | ) | | | 477 | | | | 727 | |
Leases | | | 261 | | | | - | | | | (67 | ) | | | - | | | | - | | | | 194 | |
Credit cards | | | 135 | | | | - | | | | 28 | | | | - | | | | - | | | | 163 | |
Total | | $ | 51,920 | | | $ | 6,757 | | | $ | 2,497 | | | $ | (5,779 | ) | | $ | 1,138 | | | $ | 56,533 | |
The following table presents the amortized cost basis of non-performing loans and the amortized cost basis of loans on non-accrual status for which there was no related ACL losses:
| | Non-accrual Loans | | | | | | | | | | | Past Due 90-Days- | |
(in thousands) | | With No | | | Total | | | Troubled Debt | | | or-More and Still | |
September 30, 2022 | | Recorded ACL | | | Non-accrual Loans | | | Restructurings (1) | | | Accruing Interest | |
| | | | | | | | | | | | | | | | |
Commercial real estate - non-owner occupied | | $ | — | | | $ | 620 | | | $ | — | | | $ | — | |
Commercial real estate - owner occupied | | | 2,021 | | | | 3,227 | | | | — | | | | — | |
Total commercial real estate | | | 2,021 | | | | 3,847 | | | | — | | | | — | |
| | | | | | | | | | | | | | | | |
Commercial and industrial - term | | | 403 | | | | 1,474 | | | | — | | | | — | |
Commercial and industrial - PPP | | | 42 | | | | 42 | | | | — | | | | — | |
Commercial and industrial - lines of credit | | | 1,479 | | | | 1,620 | | | | — | | | | — | |
Total commercial and industrial | | | 1,924 | | | | 3,136 | | | | — | | | | — | |
| | | | | | | | | | | | | | | | |
Residential real estate - owner occupied | | | 511 | | | | 2,468 | | | | — | | | | — | |
Residential real estate - non-owner occupied | | | — | | | | 227 | | | | — | | | | — | |
Total residential real estate | | | 511 | | | | 2,695 | | | | — | | | | — | |
| | | | | | | | | | | | | | | | |
Construction and land development | | | — | | | | — | | | | — | | | | — | |
Home equity lines of credit | | | — | | | | 524 | | | | — | | | | — | |
Consumer | | | — | | | | 366 | | | | — | | | | — | |
Leases | | | — | | | | — | | | | — | | | | — | |
Credit cards | | | — | | | | 12 | | | | — | | | | 32 | |
Total | | $ | 4,456 | | | $ | 10,580 | | | $ | — | | | $ | 32 | |
(1) Does not include TDRs captured in the non-accrual column.
| | Non-accrual Loans | | | | | | | | | | | Past Due 90-Days- | |
(in thousands) | | With No | | | Total | | | Troubled Debt | | | or-More and Still | |
December 31, 2021 | | Recorded ACL | | | Non-accrual Loans | | | Restructurings (1) | | | Accruing Interest | |
| | | | | | | | | | | | | | | | |
Commercial real estate - non-owner occupied | | $ | 486 | | | $ | 720 | | | $ | — | | | $ | — | |
Commercial real estate - owner occupied | | | 665 | | | | 1,748 | | | | — | | | | — | |
Total commercial real estate | | | 1,151 | | | | 2,468 | | | | — | | | | — | |
| | | | | | | | | | | | | | | | |
Commercial and industrial - term | | | 419 | | | | 670 | | | | 12 | | | | — | |
Commercial and industrial - PPP | | | — | | | | — | | | | — | | | | 592 | |
Commercial and industrial - lines of credit | | | — | | | | 228 | | | | — | | | | 56 | |
Total commercial and industrial | | | 419 | | | | 898 | | | | 12 | | | | 648 | |
| | | | | | | | | | | | | | | | |
Residential real estate - owner occupied | | | 805 | | | | 1,997 | | | | — | | | | 36 | |
Residential real estate - non-owner occupied | | | — | | | | 293 | | | | — | | | | — | |
Total residential real estate | | | 805 | | | | 2,290 | | | | — | | | | 36 | |
| | | | | | | | | | | | | | | | |
Construction and land development | | | — | | | | — | | | | — | | | | — | |
Home equity lines of credit | | | — | | | | 646 | | | | — | | | | — | |
Consumer | | | — | | | | 410 | | | | — | | | | — | |
Leases | | | — | | | | — | | | | — | | | | — | |
Credit cards | | | — | | | | — | | | | — | | | | — | |
Total | | $ | 2,375 | | | $ | 6,712 | | | $ | 12 | | | $ | 684 | |
(1) Does not include TDRs captured in the non-accrual column.
For the three and nine month periods ended September 30, 2022 and 2021, the amount of accrued interest income previously recorded as revenue and subsequently reversed due to the change in accrual status was immaterial.
For the three and nine month periods ended September 30, 2022 and 2021, no interest income was recognized on loans on non-accrual status.
The following table presents the amortized cost basis and ACL allocated for collateral dependent loans, which are individually evaluated to determine expected credit losses:
| | | | | Accounts | | | | | | | | | | |
(in thousands) | | | | | Receivable / | | | | | | | | | ACL | |
September 30, 2022 | | Real Estate | | | Equipment | | | Other | | | Total | | | Allocation | |
| | | | | | | | | | | | | | | | | | | | |
Commercial real estate - non-owner occupied | | $ | 6,734 | | | $ | - | | | $ | - | | | $ | 6,734 | | | $ | 998 | |
Commercial real estate - owner occupied | | | 5,148 | | | | - | | | | - | | | | 5,148 | | | | 849 | |
Total commercial real estate | | | 11,882 | | | | - | | | | - | | | | 11,882 | | | | 1,847 | |
| | | | | | | | | | | | | | | | | | | | |
Commercial and industrial - term | | | 342 | | | | 819 | | | | 536 | | | | 1,697 | | | | 390 | |
Commercial and industrial - lines of credit | | | 1,933 | | | | 1,673 | | | | 929 | | | | 4,535 | | | | 888 | |
Total commercial and industrial | | | 2,275 | | | | 2,492 | | | | 1,465 | | | | 6,232 | | | | 1,278 | |
| | | | | | | | | | | | | | | | | | | | |
Residential real estate - owner occupied | | | 3,029 | | | | - | | | | - | | | | 3,029 | | | | 363 | |
Residential real estate - non-owner occupied | | | 424 | | | | - | | | | - | | | | 424 | | | | 116 | |
Total residential real estate | | | 3,453 | | | | - | | | | - | | | | 3,453 | | | | 479 | |
| | | | | | | | | | | | | | | | | | | | |
Construction and land development | | | 613 | | | | - | | | | - | | | | 613 | | | | 9 | |
Home equity lines of credit | | | 524 | | | | - | | | | - | | | | 524 | | | | - | |
Consumer | | | - | | | | - | | | | 266 | | | | 266 | | | | 19 | |
Leases | | | - | | | | - | | | | - | | | | - | | | | - | |
Credit cards | | | - | | | | - | | | | - | | | | - | | | | - | |
Total collateral dependent loans | | $ | 18,747 | | | $ | 2,492 | | | $ | 1,731 | | | $ | 22,970 | | | $ | 3,632 | |
| | | | | Accounts | | | | | | | | | | |
(in thousands) | | | | | Receivable / | | | | | | | | | ACL | |
December 31, 2021 | | Real Estate | | | Equipment | | | Other | | | Total | | | Allocation | |
| | | | | | | | | | | | | | | | | | | | |
Commercial real estate - non-owner occupied | | $ | 720 | | | $ | - | | | $ | - | | | $ | 720 | | | $ | - | |
Commercial real estate - owner occupied | | | 7,652 | | | | - | | | | - | | | | 7,652 | | | | 1,652 | |
Total commercial real estate | | | 8,372 | | | | - | | | | - | | | | 8,372 | | | | 1,652 | |
| | | | | | | | | | | | | | | | | | | | |
Commercial and industrial - term | | | - | | | | 598 | | | | - | | | | 598 | | | | - | |
Commercial and industrial - lines of credit | | | - | | | | 200 | | | | - | | | | 200 | | | | - | |
Total commercial and industrial | | | - | | | | 798 | | | | - | | | | 798 | | | | - | |
| | | | | | | | | | | | | | | | | | | | |
Residential real estate - owner occupied | | | 1,997 | | | | - | | | | - | | | | 1,997 | | | | - | |
Residential real estate - non-owner occupied | | | 502 | | | | - | | | | - | | | | 502 | | | | 116 | |
Total residential real estate | | | 2,499 | | | | - | | | | - | | | | 2,499 | | | | 116 | |
| | | | | | | | | | | | | | | | | | | | |
Construction and land development | | | - | | | | - | | | | - | | | | - | | | | - | |
Home equity lines of credit | | | 646 | | | | - | | | | - | | | | 646 | | | | - | |
Consumer | | | - | | | | - | | | | 247 | | | | 247 | | | | - | |
Leases | | | - | | | | - | | | | - | | | | - | | | | - | |
Credit cards | | | - | | | | - | | | | - | | | | - | | | | - | |
Total collateral dependent loans | | $ | 11,517 | | | $ | 798 | | | $ | 247 | | | $ | 12,562 | | | $ | 1,768 | |
The following tables present the aging of contractually past due loans by portfolio class:
(in thousands) | | | | | | 30-59 days | | | 60-89 days | | | 90 or more | | | Total | | | Total | |
September 30, 2022 | | Current | | | Past Due | | | Past Due | | | Days Past Due | | | Past Due | | | Loans | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Commercial real estate - non-owner occupied | | $ | 1,413,186 | | | $ | 133 | | | $ | 1,653 | | | $ | 208 | | | $ | 1,994 | | | $ | 1,415,180 | |
Commercial real estate - owner occupied | | | 819,078 | | | | 415 | | | | 117 | | | | 117 | | | | 649 | | | | 819,727 | |
Total commercial real estate | | | 2,232,264 | | | | 548 | | | | 1,770 | | | | 325 | | | | 2,643 | | | | 2,234,907 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Commercial and industrial - term | | | 749,897 | | | | 204 | | | | 409 | | | | 683 | | | | 1,296 | | | | 751,193 | |
Commercial and industrial - term - PPP | | | 17,042 | | | | 2,343 | | | | 42 | | | | 42 | | | | 2,427 | | | | 19,469 | |
Commercial and industrial - lines of credit | | | 417,285 | | | | 1,639 | | | | 2 | | | | 122 | | | | 1,763 | | | | 419,048 | |
Total commercial and industrial | | | 1,184,224 | | | | 4,186 | | | | 453 | | | | 847 | | | | 5,486 | | | | 1,189,710 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Residential real estate - owner occupied | | | 554,406 | | | | 1,264 | | | | 436 | | | | 1,532 | | | | 3,232 | | | | 557,638 | |
Residential real estate - non-owner occupied | | | 302,408 | | | | 430 | | | | - | | | | 98 | | | | 528 | | | | 302,936 | |
Total residential real estate | | | 856,814 | | | | 1,694 | | | | 436 | | | | 1,630 | | | | 3,760 | | | | 860,574 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Construction and land development | | | 414,589 | | | | 43 | | | | — | | | | — | | | | 43 | | | | 414,632 | |
Home equity lines of credit | | | 198,993 | | | | 271 | | | | 67 | | | | 154 | | | | 492 | | | | 199,485 | |
Consumer | | | 138,220 | | | | 302 | | | | 75 | | | | 246 | | | | 623 | | | | 138,843 | |
Leases | | | 13,959 | | | | — | | | | — | | | | — | | | | — | | | | 13,959 | |
Credit cards | | | 20,731 | | | | 2 | | | | 2 | | | | 32 | | | | 36 | | | | 20,767 | |
Total | | $ | 5,059,794 | | | $ | 7,046 | | | $ | 2,803 | | | $ | 3,234 | | | $ | 13,083 | | | $ | 5,072,877 | |
(in thousands) | | | | | | 30-59 days | | | 60-89 days | | | 90 or more | | | Total | | | Total | |
December 31, 2021 | | Current | | | Past Due | | | Past Due | | | Days Past Due | | | Past Due | | | Loans | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Commercial real estate - non-owner occupied | | $ | 1,127,448 | | | $ | - | | | $ | 81 | | | $ | 715 | | | $ | 796 | | | $ | 1,128,244 | |
Commercial real estate - owner occupied | | | 677,231 | | | | 360 | | | | 327 | | | | 487 | | | | 1,174 | | | | 678,405 | |
Total commercial real estate | | | 1,804,679 | | | | 360 | | | | 408 | | | | 1,202 | | | | 1,970 | | | | 1,806,649 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Commercial and industrial - term | | | 595,070 | | | | 1,032 | | | | 44 | | | | 564 | | | | 1,640 | | | | 596,710 | |
Commercial and industrial - term - PPP | | | 139,718 | | | | 128 | | | | 296 | | | | 592 | | | | 1,016 | | | | 140,734 | |
Commercial and industrial - lines of credit | | | 369,963 | | | | 271 | | | | 22 | | | | 56 | | | | 349 | | | | 370,312 | |
Total commercial and industrial | | | 1,104,751 | | | | 1,431 | | | | 362 | | | | 1,212 | | | | 3,005 | | | | 1,107,756 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Residential real estate - owner occupied | | | 397,415 | | | | 1,399 | | | | 137 | | | | 1,744 | | | | 3,280 | | | | 400,695 | |
Residential real estate - non-owner occupied | | | 280,257 | | | | 403 | | | | 258 | | | | 100 | | | | 761 | | | | 281,018 | |
Total residential real estate | | | 677,672 | | | | 1,802 | | | | 395 | | | | 1,844 | | | | 4,041 | | | | 681,713 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Construction and land development | | | 299,206 | | | | — | | | | — | | | | — | | | | — | | | | 299,206 | |
Home equity lines of credit | | | 138,141 | | | | 279 | | | | 47 | | | | 509 | | | | 835 | | | | 138,976 | |
Consumer | | | 103,109 | | | | 724 | | | | 102 | | | | 359 | | | | 1,185 | | | | 104,294 | |
Leases | | | 13,622 | | | | — | | | | — | | | | — | | | | — | | | | 13,622 | |
Credit cards | | | 17,087 | | | | — | | | | — | | | | — | | | | — | | | | 17,087 | |
Total | | $ | 4,158,267 | | | $ | 4,596 | | | $ | 1,314 | | | $ | 5,126 | | | $ | 11,036 | | | $ | 4,169,303 | |
Loan Risk Ratings
Consistent with regulatory guidance, Bancorp categorizes loans into credit risk rating 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. Pass-rated loans include all risk-rated loans other than those classified as OAEM, substandard, and doubtful, which are defined below:
OAEM – Loans classified as OAEM have potential weaknesses requiring management's heightened attention. These potential weaknesses may result in deterioration of repayment prospects for the loan or of Bancorp's credit position at some future date.
Substandard – Loans classified as substandard are inadequately protected by the paying capacity of the obligor or of collateral pledged, if any. Loans so classified have well-defined weaknesses that jeopardize ultimate repayment of the debt. Default is a distinct possibility if the deficiencies are not corrected.
Substandard non-performing – Loans classified as substandard non-performing have all the characteristics of substandard loans and have been placed on non-accrual status or have been accounted for as TDRs. Loans are placed on non-accrual status when prospects for recovering both principal and accrued interest are considered doubtful or when a default of principal or interest has existed for 90 days or more.
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 repayment in full, on the basis of currently existing facts, conditions and values, highly questionable and improbable.
Management considers the guidance in ASC 310-20 when determining whether a modification, extension, or renewal of loan constitutes a current period origination. Current period renewals of credit are re-underwritten at the point of renewal and considered current period originations for purposes of the table below. Bancorp has elected not to disclose revolving loans that have converted to term loans, as activity relating to this disclosure, which is included in the tables is currently immaterial to Bancorp’s loan portfolio and is expected to be in the future. As of September 30, 2022, the risk rating of loans based on year of origination was as follows:
| | | | | | | | | | | | | | | | | | | | | | | | | | | Revolving | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | loans | | | | | |
(in thousands) | | Term Loans Amortized Cost Basis by Origination Year | | | | amortized | | | | | |
September 30, 2022 | | 2022 | | | 2021 | | | 2020 | | | 2019 | | | 2018 | | | Prior | | | | cost basis | | | Total | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Commercial real estate - non-owner occupied: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Risk rating | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Pass | | $ | 293,231 | | | $ | 384,606 | | | $ | 285,261 | | | $ | 114,927 | | | $ | 77,978 | | | $ | 166,586 | | | $ | 21,887 | | | $ | 1,344,476 | |
OAEM | | | - | | | | 5,290 | | | | 2,317 | | | | 18,793 | | | | - | | | | 5,464 | | | | 5,850 | | | | 37,714 | |
Substandard | | | - | | | | 298 | | | | 4,926 | | | | 19,789 | | | | - | | | | 7,257 | | | | 100 | | | | 32,370 | |
Substandard non-performing | | | - | | | | - | | | | - | | | | - | | | | - | | | | 620 | | | | - | | | | 620 | |
Doubtful | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | |
Total Commercial real estate non-owner occupied | | $ | 293,231 | | | $ | 390,194 | | | $ | 292,504 | | | $ | 153,509 | | | $ | 77,978 | | | $ | 179,927 | | | $ | 27,837 | | | $ | 1,415,180 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Commercial real estate - owner occupied: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Risk rating | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Pass | | $ | 118,302 | | | $ | 209,793 | | | $ | 199,078 | | | $ | 103,352 | | | $ | 70,931 | | | $ | 82,084 | | | $ | 11,496 | | | $ | 795,036 | |
OAEM | | | 2,896 | | | | 1,797 | | | | 4,571 | | | | 735 | | | | 717 | | | | 101 | | | | 510 | | | | 11,327 | |
Substandard | | | - | | | | 1,160 | | | | - | | | | 6,948 | | | | 1,958 | | | | 71 | | | | - | | | | 10,137 | |
Substandard non-performing | | | 1,538 | | | | 1,213 | | | | - | | | | 359 | | | | - | | | | 117 | | | | - | | | | 3,227 | |
Doubtful | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | |
Total Commercial real estate owner occupied | | $ | 122,736 | | | $ | 213,963 | | | $ | 203,649 | | | $ | 111,394 | | | $ | 73,606 | | | $ | 82,373 | | | $ | 12,006 | | | $ | 819,727 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Commercial and industrial - term: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Risk rating | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Pass | | $ | 272,982 | | | $ | 252,324 | | | $ | 101,275 | | | $ | 41,359 | | | $ | 38,690 | | | $ | 31,500 | | | $ | - | | | $ | 738,130 | |
OAEM | | | 3,968 | | | | 3,166 | | | | - | | | | 345 | | | | 1,809 | | | | - | | | | - | | | | 9,288 | |
Substandard | | | 185 | | | | - | | | | - | | | | 1,615 | | | | 136 | | | | 365 | | | | - | | | | 2,301 | |
Substandard non-performing | | | 464 | | | | 167 | | | | 581 | | | | 101 | | | | 30 | | | | 131 | | | | - | | | | 1,474 | |
Doubtful | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | |
Total Commercial and industrial - term | | $ | 277,599 | | | $ | 255,657 | | | $ | 101,856 | | | $ | 43,420 | | | $ | 40,665 | | | $ | 31,996 | | | $ | - | | | $ | 751,193 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Commercial and industrial - PPP | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Risk rating | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Pass | | $ | - | | | $ | 14,836 | | | $ | 4,591 | | | $ | - | | | $ | - | | | $ | - | | | $ | - | | | $ | 19,427 | |
OAEM | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | |
Substandard | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | |
Substandard non-performing | | | - | | | | 14 | | | | 28 | | | | - | | | | - | | | | - | | | | - | | | | 42 | |
Doubtful | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | |
Total Commercial and industrial - PPP | | $ | - | | | $ | 14,850 | | | $ | 4,619 | | | $ | - | | | $ | - | | | $ | - | | | $ | - | | | $ | 19,469 | |
(continued)
(continued)
| | | | | | | | | | | | | | | | | | | | | | | | | | | Revolving | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | loans | | | | | |
(in thousands) | | Term Loans Amortized Cost Basis by Origination Year | | | | amortized | | | | | |
September 30, 2022 | | 2022 | | | 2021 | | | 2020 | | | 2019 | | | 2018 | | | Prior | | | | cost basis | | | Total | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Commercial and industrial - lines of credit | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Risk rating | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Pass | | $ | 43,413 | | | $ | 13,746 | | | $ | 1,118 | | | $ | 9,941 | | | $ | 1,268 | | | $ | 1,159 | | | $ | 336,534 | | | $ | 407,179 | |
OAEM | | | - | | | | - | | | | - | | | | - | | | | - | | | | 391 | | | | 6,601 | | | | 6,992 | |
Substandard | | | - | | | | - | | | | 929 | | | | 1,933 | | | | - | | | | - | | | | 395 | | | | 3,257 | |
Substandard non-performing | | | - | | | | - | | | | - | | | | 964 | | | | - | | | | - | | | | 656 | | | | 1,620 | |
Doubtful | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | |
Total Commercial and industrial - lines of credit | | $ | 43,413 | | | $ | 13,746 | | | $ | 2,047 | | | $ | 12,838 | | | $ | 1,268 | | | $ | 1,550 | | | $ | 344,186 | | | $ | 419,048 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Residential real estate - owner occupied | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Risk rating | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Pass | | $ | 144,412 | | | $ | 191,838 | | | $ | 99,108 | | | $ | 29,820 | | | $ | 15,527 | | | $ | 73,156 | | | $ | - | | | $ | 553,861 | |
OAEM | | | 365 | | | | 96 | | | | - | | | | 76 | | | | - | | | | - | | | | - | | | | 537 | |
Substandard | | | 19 | | | | - | | | | 10 | | | | - | | | | 142 | | | | 601 | | | | - | | | | 772 | |
Substandard non-performing | | | 63 | | | | 220 | | | | 73 | | | | 692 | | | | 123 | | | | 1,297 | | | | - | | | | 2,468 | |
Doubtful | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | |
Total Residential real estate - owner occupied | | $ | 144,859 | | | $ | 192,154 | | | $ | 99,191 | | | $ | 30,588 | | | $ | 15,792 | | | $ | 75,054 | | | $ | - | | | $ | 557,638 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Residential real estate - non-owner occupied | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Risk rating | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Pass | | $ | 78,318 | | | $ | 85,299 | | | $ | 59,138 | | | $ | 34,834 | | | $ | 20,226 | | | $ | 23,728 | | | $ | - | | | $ | 301,543 | |
OAEM | | | - | | | | - | | | | 118 | | | | 271 | | | | 126 | | | | 309 | | | | - | | | | 824 | |
Substandard | | | - | | | | - | | | | - | | | | - | | | | - | | | | 342 | | | | - | | | | 342 | |
Substandard non-performing | | | 90 | | | | 23 | | | | - | | | | - | | | | - | | | | 114 | | | | - | | | | 227 | |
Doubtful | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | |
Total Residential real estate - non-owner occupied | | $ | 78,408 | | | $ | 85,322 | | | $ | 59,256 | | | $ | 35,105 | | | $ | 20,352 | | | $ | 24,493 | | | $ | - | | | $ | 302,936 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Construction and land development | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Risk rating | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Pass | | $ | 187,688 | | | $ | 107,932 | | | $ | 68,481 | | | $ | 15,387 | | | $ | 6,028 | | | $ | 1,705 | | | $ | 21,342 | | | $ | 408,563 | |
OAEM | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | 999 | | | | 999 | |
Substandard | | | 4,457 | | | | 613 | | | | - | | | | - | | | | - | | | | - | | | | - | | | | 5,070 | |
Substandard non-performing | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | |
Doubtful | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | |
Total Construction and land development | | $ | 192,145 | | | $ | 108,545 | | | $ | 68,481 | | | $ | 15,387 | | | $ | 6,028 | | | $ | 1,705 | | | $ | 22,341 | | | $ | 414,632 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Home equity lines of credit | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Risk rating | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Pass | | $ | - | | | $ | - | | | $ | - | | | $ | - | | | $ | - | | | $ | - | | | $ | 198,922 | | | $ | 198,922 | |
OAEM | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | |
Substandard | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | 39 | | | | 39 | |
Substandard non-performing | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | 524 | | | | 524 | |
Doubtful | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | |
Total Home equity lines of credit | | $ | - | | | $ | - | | | $ | - | | | $ | - | | | $ | - | | | $ | - | | | $ | 199,485 | | | $ | 199,485 | |
(continued)
(continued)
| | | | | | | | | | | | | | | | | | | | | | | | | | | Revolving | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | loans | | | | | |
(in thousands) | | Term Loans Amortized Cost Basis by Origination Year | | | | amortized | | | | | |
September 30, 2022 | | 2022 | | | 2021 | | | 2020 | | | 2019 | | | 2018 | | | Prior | | | | cost basis | | | Total | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Consumer | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Risk rating | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Pass | | $ | 23,526 | | | $ | 19,826 | | | $ | 6,547 | | | $ | 6,195 | | | $ | 2,909 | | | $ | 2,355 | | | $ | 77,080 | | | $ | 138,438 | |
OAEM | | | 39 | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | 39 | |
Substandard | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | |
Substandard non-performing | | | - | | | | 36 | | | | 76 | | | | 78 | | | | 25 | | | | 53 | | | | 98 | | | | 366 | |
Doubtful | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | |
Total Consumer | | $ | 23,565 | | | $ | 19,862 | | | $ | 6,623 | | | $ | 6,273 | | | $ | 2,934 | | | $ | 2,408 | | | $ | 77,178 | | | $ | 138,843 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Leases | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Risk rating | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Pass | | $ | 3,901 | | | $ | 4,592 | | | $ | 2,816 | | | $ | 966 | | | $ | 812 | | | $ | 872 | | | $ | - | | | $ | 13,959 | |
OAEM | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | |
Substandard | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | |
Substandard non-performing | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | |
Doubtful | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | |
Total Leases | | $ | 3,901 | | | $ | 4,592 | | | $ | 2,816 | | | $ | 966 | | | $ | 812 | | | $ | 872 | | | $ | - | | | $ | 13,959 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Credit cards | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Risk rating | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Pass | | $ | - | | | $ | - | | | $ | - | | | $ | - | | | $ | - | | | $ | - | | | $ | 20,755 | | | $ | 20,755 | |
OAEM | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | |
Substandard | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | |
Substandard non-performing | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | 12 | | | | 12 | |
Doubtful | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | |
Total Credit cards | | $ | - | | | $ | - | | | $ | - | | | $ | - | | | $ | - | | | $ | - | | | $ | 20,767 | | | $ | 20,767 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total loans | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Risk rating | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Pass | | $ | 1,165,772 | | | $ | 1,284,792 | | | $ | 827,414 | | | $ | 356,781 | | | $ | 234,370 | | | $ | 383,146 | | | $ | 688,015 | | | $ | 4,940,290 | |
OAEM | | | 7,269 | | | | 10,347 | | | | 7,005 | | | | 20,220 | | | | 2,651 | | | | 6,265 | | | | 13,960 | | | | 67,717 | |
Substandard | | | 4,661 | | | | 2,071 | | | | 5,866 | | | | 30,285 | | | | 2,236 | | | | 8,637 | | | | 534 | | | | 54,290 | |
Substandard non-performing | | | 2,155 | | | | 1,673 | | | | 758 | | | | 2,194 | | | | 178 | | | | 2,332 | | | | 1,290 | | | | 10,580 | |
Doubtful | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | |
Total Loans | | $ | 1,179,857 | | | $ | 1,298,883 | | | $ | 841,043 | | | $ | 409,480 | | | $ | 239,435 | | | $ | 400,380 | | | $ | 703,799 | | | $ | 5,072,877 | |
As of December 31, 2021, the risk rating of loans based on year of origination was as follows:
| | | | | | | | | | | | | | | | | | | | | | | | | | | Revolving | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | loans | | | | | |
(in thousands) | | Term Loans Amortized Cost Basis by Origination Year | | | | amortized | | | | | |
December 31, 2021 | | 2021 | | | 2020 | | | 2019 | | | 2018 | | | 2017 | | | Prior | | | | cost basis | | | Total | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Commercial real estate - non-owner occupied: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Risk rating | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Pass | | $ | 381,014 | | | $ | 298,177 | | | $ | 134,286 | | | $ | 86,638 | | | $ | 85,110 | | | $ | 81,635 | | | $ | 19,465 | | | $ | 1,086,325 | |
OAEM | | | 3,186 | | | | 2,666 | | | | 19,784 | | | | - | | | | 353 | | | | 1,619 | | | | 248 | | | | 27,856 | |
Substandard | | | 4,174 | | | | 1,440 | | | | - | | | | - | | | | - | | | | 7,629 | | | | 100 | | | | 13,343 | |
Substandard non-performing | | | - | | | | 39 | | | | 78 | | | | - | | | | 592 | | | | 11 | | | | - | | | | 720 | |
Doubtful | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | |
Total Commercial real estatenon-owner occupied | | $ | 388,374 | | | $ | 302,322 | | | $ | 154,148 | | | $ | 86,638 | | | $ | 86,055 | | | $ | 90,894 | | | $ | 19,813 | | | $ | 1,128,244 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Commercial real estate - owner occupied: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Risk rating | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Pass | | $ | 203,545 | | | $ | 192,322 | | | $ | 91,078 | | | $ | 75,062 | | | $ | 33,713 | | | $ | 44,364 | | | $ | 9,236 | | | $ | 649,320 | |
OAEM | | | 1,681 | | | | 1,480 | | | | 3,568 | | | | 469 | | | | 1,506 | | | | 124 | | | | 570 | | | | 9,398 | |
Substandard | | | 5,051 | | | | 3,605 | | | | 5,985 | | | | 1,275 | | | | 627 | | | | - | | | | 1,396 | | | | 17,939 | |
Substandard non-performing | | | 1,259 | | | | - | | | | - | | | | - | | | | 32 | | | | 457 | | | | - | | | | 1,748 | |
Doubtful | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | |
Total Commercial real estate owner occupied | | $ | 211,536 | | | $ | 197,407 | | | $ | 100,631 | | | $ | 76,806 | | | $ | 35,878 | | | $ | 44,945 | | | $ | 11,202 | | | $ | 678,405 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Commercial and industrial - term: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Risk rating | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Pass | | $ | 283,150 | | | $ | 143,211 | | | $ | 58,988 | | | $ | 52,388 | | | $ | 26,081 | | | $ | 24,421 | | | $ | - | | | $ | 588,239 | |
OAEM | | | 738 | | | | 86 | | | | 254 | | | | 3,382 | | | | 8 | | | | - | | | | - | | | | 4,468 | |
Substandard | | | 170 | | | | 42 | | | | 2,667 | | | | 176 | | | | 111 | | | | 167 | | | | - | | | | 3,333 | |
Substandard non-performing | | | - | | | | 543 | | | | 72 | | | | 55 | | | | - | | | | - | | | | - | | | | 670 | |
Doubtful | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | |
Total Commercial and industrial - term | | $ | 284,058 | | | $ | 143,882 | | | $ | 61,981 | | | $ | 56,001 | | | $ | 26,200 | | | $ | 24,588 | | | $ | - | | | $ | 596,710 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Commercial and industrial - PPP | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Risk rating | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Pass | | $ | 128,409 | | | $ | 12,325 | | | $ | - | | | $ | - | | | $ | - | | | $ | - | | | $ | - | | | $ | 140,734 | |
OAEM | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | |
Substandard | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | |
Substandard non-performing | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | |
Doubtful | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | |
Total Commercial and industrial - PPP | | $ | 128,409 | | | $ | 12,325 | | | $ | - | | | $ | - | | | $ | - | | | $ | - | | | $ | - | | | $ | 140,734 | |
(continued)
(continued)
| | | | | | | | | | | | | | | | | | | | | | | | | | | Revolving | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | loans | | | | | |
(in thousands) | | Term Loans Amortized Cost Basis by Origination Year | | | | amortized | | | | | |
December 31, 2021 | | 2021 | | | 2020 | | | 2019 | | | 2018 | | | 2017 | | | Prior | | | | cost basis | | | Total | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Commercial and industrial - lines of credit | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Risk rating | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Pass | | $ | 33,875 | | | $ | 8,352 | | | $ | 11,103 | | | $ | 1,039 | | | $ | 207 | | | $ | 193 | | | $ | 303,682 | | | $ | 358,451 | |
OAEM | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | 6,355 | | | | 6,355 | |
Substandard | | | - | | | | - | | | | 1,916 | | | | - | | | | 1,549 | | | | - | | | | 1,813 | | | | 5,278 | |
Substandard non-performing | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | 228 | | | | 228 | |
Doubtful | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | |
Total Commercial and industrial - lines of credit | | $ | 33,875 | | | $ | 8,352 | | | $ | 13,019 | | | $ | 1,039 | | | $ | 1,756 | | | $ | 193 | | | $ | 312,078 | | | $ | 370,312 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Residential real estate - owner occupied | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Risk rating | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Pass | | $ | 176,487 | | | $ | 99,936 | | | $ | 31,327 | | | $ | 17,259 | | | $ | 16,599 | | | $ | 56,639 | | | $ | - | | | $ | 398,247 | |
OAEM | | | 101 | | | | - | | | | 174 | | | | - | | | | - | | | | - | | | | - | | | | 275 | |
Substandard | | | - | | | | - | | | | - | | | | - | | | | 108 | | | | 68 | | | | - | | | | 176 | |
Substandard non-performing | | | 164 | | | | 103 | | | | 136 | | | | 230 | | | | 714 | | | | 650 | | | | - | | | | 1,997 | |
Doubtful | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | |
Total Residential real estate - owner occupied | | $ | 176,752 | | | $ | 100,039 | | | $ | 31,637 | | | $ | 17,489 | | | $ | 17,421 | | | $ | 57,357 | | | $ | - | | | $ | 400,695 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Residential real estate - non-owner occupied | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Risk rating | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Pass | | $ | 94,482 | | | $ | 78,785 | | | $ | 46,177 | | | $ | 27,494 | | | $ | 16,171 | | | $ | 15,909 | | | $ | - | | | $ | 279,018 | |
OAEM | | | 352 | | | | 126 | | | | 281 | | | | 132 | | | | - | | | | 462 | | | | - | | | | 1,353 | |
Substandard | | | - | | | | - | | | | - | | | | - | | | | - | | | | 354 | | | | - | | | | 354 | |
Substandard non-performing | | | 103 | | | | - | | | | 45 | | | | 28 | | | | - | | | | 117 | | | | - | | | | 293 | |
Doubtful | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | |
Total Residential real estate - non-owner occupied | | $ | 94,937 | | | $ | 78,911 | | | $ | 46,503 | | | $ | 27,654 | | | $ | 16,171 | | | $ | 16,842 | | | $ | - | | | $ | 281,018 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Construction and land development | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Risk rating | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Pass | | $ | 160,696 | | | $ | 99,699 | | | $ | 16,665 | | | $ | 6,262 | | | $ | 1,890 | | | $ | 1,156 | | | $ | 12,736 | | | $ | 299,104 | |
OAEM | | | - | | | | - | | | | - | | | | - | | | | 102 | | | | - | | | | - | | | | 102 | |
Substandard | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | |
Substandard non-performing | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | |
Doubtful | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | |
Total Construction and land development | | $ | 160,696 | | | $ | 99,699 | | | $ | 16,665 | | | $ | 6,262 | | | $ | 1,992 | | | $ | 1,156 | | | $ | 12,736 | | | $ | 299,206 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Home equity lines of credit | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Risk rating | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Pass | | $ | - | | | $ | - | | | $ | - | | | $ | - | | | $ | - | | | $ | - | | | $ | 138,239 | | | $ | 138,239 | |
OAEM | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | 91 | | | | 91 | |
Substandard | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | |
Substandard non-performing | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | 646 | | | | 646 | |
Doubtful | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | |
Total Home equity lines of credit | | $ | - | | | $ | - | | | $ | - | | | $ | - | | | $ | - | | | $ | - | | | $ | 138,976 | | | $ | 138,976 | |
(continued)
(continued)
| | | | | | | | | | | | | | | | | | | | | | | | | | Revolving | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | loans | | | | | |
(in thousands) | | Term Loans Amortized Cost Basis by Origination Year | | | amortized | | | | | |
December 31, 2021 | | 2021 | | | 2020 | | | 2019 | | | 2018 | | | 2017 | | | Prior | | | cost basis | | | Total | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Consumer | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Risk rating | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Pass | | $ | 23,866 | | | $ | 9,316 | | | $ | 5,014 | | | $ | 1,260 | | | $ | 555 | | | $ | 646 | | | $ | 63,227 | | | $ | 103,884 | |
OAEM | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | |
Substandard | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | |
Substandard non-performing | | | 55 | | | | 304 | | | | 30 | | | | 11 | | | | - | | | | 4 | | | | 6 | | | | 410 | |
Doubtful | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | |
Total Consumer | | $ | 23,921 | | | $ | 9,620 | | | $ | 5,044 | | | $ | 1,271 | | | $ | 555 | | | $ | 650 | | | $ | 63,233 | | | $ | 104,294 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Leases | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Risk rating | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Pass | | $ | 5,375 | | | $ | 3,596 | | | $ | 1,375 | | | $ | 1,331 | | | $ | 406 | | | $ | 1,539 | | | $ | - | | | $ | 13,622 | |
OAEM | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | |
Substandard | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | |
Substandard non-performing | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | |
Doubtful | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | |
Total Leases | | $ | 5,375 | | | $ | 3,596 | | | $ | 1,375 | | | $ | 1,331 | | | $ | 406 | | | $ | 1,539 | | | $ | - | | | $ | 13,622 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Credit cards | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Risk rating | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Pass | | $ | - | | | $ | - | | | $ | - | | | $ | - | | | $ | - | | | $ | - | | | $ | 17,087 | | | $ | 17,087 | |
OAEM | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | |
Substandard | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | |
Substandard non-performing | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | |
Doubtful | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | |
Total Credit cards | | $ | - | | | $ | - | | | $ | - | | | $ | - | | | $ | - | | | $ | - | | | $ | 17,087 | | | $ | 17,087 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total loans | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Risk rating | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Pass | | $ | 1,490,899 | | | $ | 945,719 | | | $ | 396,013 | | | $ | 268,733 | | | $ | 180,732 | | | $ | 226,502 | | | $ | 563,672 | | | $ | 4,072,270 | |
OAEM | | | 6,058 | | | | 4,358 | | | | 24,061 | | | | 3,983 | | | | 1,969 | | | | 2,205 | | | | 7,264 | | | | 49,898 | |
Substandard | | | 9,395 | | | | 5,087 | | | | 10,568 | | | | 1,451 | | | | 2,395 | | | | 8,218 | | | | 3,309 | | | | 40,423 | |
Substandard non-performing | | | 1,581 | | | | 989 | | | | 361 | | | | 324 | | | | 1,338 | | | | 1,239 | | | | 880 | | | | 6,712 | |
Doubtful | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | |
Total Loans | | $ | 1,507,933 | | | $ | 956,153 | | | $ | 431,003 | | | $ | 274,491 | | | $ | 186,434 | | | $ | 238,164 | | | $ | 575,125 | | | $ | 4,169,303 | |
For certain loan classes, such as credit cards, credit quality is evaluated based on the aging status of the loan, which was previously presented, and by payment activity. The following table presents the recorded investment in credit cards based on payment activity:
| | September 30, | | | December 31, | |
(in thousands) | | 2022 | | | 2021 | |
| | | | | | | | |
Credit cards | | | | | | | | |
Performing | | $ | 20,723 | | | $ | 17,087 | |
Non-performing | | | 44 | | | | — | |
Total credit cards | | $ | 20,767 | | | $ | 17,087 | |
Troubled Debt Restructurings
Detail of outstanding TDRs classified as non-performing loans follows:
| | September 30, 2022 | | | December 31, 2021 | |
| | | | | | Specific | | | Additional | | | | | | | Specific | | | Additional | |
| | | | | | reserve | | | commitment | | | | | | | reserve | | | commitment | |
(in thousands) | | Balance | | | allocation | | | to lend | | | Balance | | | allocation | | | to lend | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Commercial real estate - owner occupied | | $ | 902 | | | $ | 202 | | | $ | — | | | $ | 950 | | | $ | 202 | | | $ | — | |
Commercial & industrial - term | | | — | | | | — | | | | — | | | | 12 | | | | 12 | | | | — | |
Total TDRs | | $ | 902 | | | $ | 202 | | | $ | — | | | $ | 962 | | | $ | 214 | | | $ | — | |
During the three and nine month periods ended September 30, 2022 and 2021, there were no loans modified as TDRs and there were no payment defaults of existing TDRs within 12 months following the modification. Default is determined at 90 or more days past due, charge-off, or foreclosure.
Bancorp had $786,000 and $917,000, respectively, in residential real estate loans for which formal foreclosure proceedings were in process at September 30, 2022 and December 31, 2021.
|