Allowance for Loan Losses (Tables)

12 Months Ended

Dec. 31, 2019

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Changes in the Allowance for Loan Losses and Loan Balances Outstanding

The following tables present, by portfolio segment, the changes in the allowance for loan losses, the ending allocation of the allowance for loan losses and the loan balances outstanding for the years ended December 31, 2019, 2018 and 2017. The changes can be impacted by overall loan volume, adversely graded loans, historical charge-offs and economic factors

Allowance for loan losses:

December 31, 2019	Beginning balance		Charge-offs			Recoveries		Provision (Credit)			Ending Balance
Commercial & Agriculture	$	1,747	$	(114	)	$	86	$	500		$	2,219
Commercial Real Estate:
Owner Occupied		1,962		(161	)		289		451			2,541
Non-Owner Occupied		5,803		—			102		679			6,584
Residential Real Estate		1,531		(294	)		259		86			1,582
Real Estate Construction		1,046		(24	)		3		225			1,250
Farm Real Estate		397		—			5		(58	)		344
Consumer and Other		284		(183	)		85		61			247
Unallocated		909		—			—		(909	)		—
Total	$	13,679	$	(776	)	$	829	$	1,035		$	14,767

Allowance for loan losses:

December 31, 2018	Beginning balance		Charge-offs			Recoveries		Provision (Credit)			Ending Balance
Commercial & Agriculture	$	1,562	$	(249	)	$	169	$	265		$	1,747
Commercial Real Estate:
Owner Occupied		2,043		(193	)		158		(46	)		1,962
Non-Owner Occupied		5,307		(153	)		28		621			5,803
Residential Real Estate		1,910		(105	)		208		(482	)		1,531
Real Estate Construction		834		—			—		212			1,046
Farm Real Estate		430		—			5		(38	)		397
Consumer and Other		290		(203	)		100		97			284
Unallocated		758		—			—		151			909
Total	$	13,134	$	(903	)	$	668	$	780		$	13,679

Allowance for loan losses:

December 31, 2017	Beginning balance		Charge-offs			Recoveries		Provision (Credit)			Ending Balance
Commercial & Agriculture	$	2,018	$	(11	)	$	372	$	(817	)	$	1,562
Commercial Real Estate:
Owner Occupied		2,171		(328	)		69		131			2,043
Non-Owner Occupied		4,606		(38	)		46		693			5,307
Residential Real Estate		3,089		(400	)		194		(973	)		1,910
Real Estate Construction		420		—			44		370			834
Farm Real Estate		442		—			3		(15	)		430
Consumer and Other		314		(165	)		43		98			290
Unallocated		245		—			—		513			758
Total	$	13,305	$	(942	)	$	771	$	—		$	13,134

The following tables present, by portfolio segment, the allocation of the allowance for loan losses and related loan balances as of December 31, 2019 and December 31, 2018.

December 31, 2019	Loans acquired with credit deterioration		Loans individually evaluated for impairment		Loans collectively evaluated for impairment		Total
Allowance for loan losses:
Commercial & Agriculture	$	—	$	—	$	2,219	$	2,219
Commercial Real Estate:
Owner Occupied		—		9		2,532		2,541
Non-Owner Occupied		—		—		6,584		6,584
Residential Real Estate		—		82		1,500		1,582
Real Estate Construction		—		—		1,250		1,250
Farm Real Estate		—		—		344		344
Consumer and Other		—		—		247		247
Unallocated		—		—		—		—
Total	$	—	$	91	$	14,676	$	14,767
Outstanding loan balances:
Commercial & Agriculture	$	—	$	367	$	202,743	$	203,110
Commercial Real Estate:
Owner Occupied		—		426		245,180		245,606
Non-Owner Occupied		—		374		591,848		592,222
Residential Real Estate		467		1,764		460,801		463,032
Real Estate Construction		—		—		155,825		155,825
Farm Real Estate		—		666		33,448		34,114
Consumer and Other		—		—		15,061		15,061
Total	$	467	$	3,597	$	1,704,906	$	1,708,970

December 31, 2018	Loans acquired with credit deterioration		Loans individually evaluated for impairment		Loans collectively evaluated for impairment		Total
Allowance for loan losses:
Commercial & Agriculture	$	—	$	—	$	1,747	$	1,747
Commercial Real Estate:
Owner Occupied		—		12		1,950		1,962
Non-Owner Occupied		—		—		5,803		5,803
Residential Real Estate		8		122		1,401		1,531
Real Estate Construction		—		—		1,046		1,046
Farm Real Estate		—		7		390		397
Consumer and Other		—		—		284		284
Unallocated		—		—		909		909
Total	$	8	$	141	$	13,530	$	13,679
Outstanding loan balances:
Commercial & Agriculture	$	41	$	367	$	176,693	$	177,101
Commercial Real Estate:
Owner Occupied		—		484		209,637		210,121
Non-Owner Occupied		—		31		523,567		523,598
Residential Real Estate		883		1,279		455,688		457,850
Real Estate Construction		—		—		135,195		135,195
Farm Real Estate		—		696		37,817		38,513
Consumer and Other		—		—		19,563		19,563
Total	$	924	$	2,857	$	1,558,160	$	1,561,941

Credit Exposures by Internally Assigned Grades

December 31, 2019	Pass		Special Mention		Substandard		Doubtful		Ending Balance
Commercial & Agriculture	$	199,649	$	2,236	$	1,225	$	—	$	203,110
Commercial Real Estate:
Owner Occupied		237,171		5,617		2,818		—		245,606
Non-Owner Occupied		588,633		2,155		1,434		—		592,222
Residential Real Estate		73,289		528		6,495		—		80,312
Real Estate Construction		145,251		—		9		—		145,260
Farm Real Estate		30,808		567		2,739		—		34,114
Consumer and Other		1,289		—		6		—		1,295
Total	$	1,276,090	$	11,103	$	14,726	$	—	$	1,301,919

December 31, 2018	Pass		Special Mention		Substandard		Doubtful		Ending Balance
Commercial & Agriculture	$	173,783	$	1,509	$	1,809	$	—	$	177,101
Commercial Real Estate:
Owner Occupied		201,228		3,512		5,381		—		210,121
Non-Owner Occupied		520,487		2,023		1,088		—		523,598
Residential Real Estate		70,908		580		7,363		—		78,851
Real Estate Construction		124,769		13		41		—		124,823
Farm Real Estate		32,908		3,096		2,509		—		38,513
Consumer and Other		1,713		—		20		—		1,733
Total	$	1,125,796	$	10,733	$	18,211	$	—	$	1,154,740

Performing and Nonperforming Loans

Certain TDRs are classified as nonperforming at the time of restructure and may only be returned to performing status after considering the borrower’s sustained repayment performance for a reasonable period, generally six months.

December 31, 2019	Residential Real Estate		Real Estate Construction		Consumer and Other		Total
Performing	$	382,720	$	10,565	$	13,766	$	407,051
Nonperforming		—		—		—		—
Total	$	382,720	$	10,565	$	13,766	$	407,051

December 31, 2018	Residential Real Estate		Real Estate Construction		Consumer and Other		Total
Performing	$	378,999	$	10,372	$	17,830	$	407,201
Nonperforming		—		—		—		—
Total	$	378,999	$	10,372	$	17,830	$	407,201

Aging Analysis of Past Due Loans

The following tables include an aging analysis of the recorded investment of past due loans outstanding as of December 31, 2019 and 2018.

December 31, 2019	30-59 Days Past Due		60-89 Days Past Due		90 Days or Greater		Total Past Due		Current		Purchased Credit- Impaired Loans		Total Loans		Past Due 90 Days and Accruing
Commercial & Agriculture	$	27	$	35	$	106	$	168	$	202,942	$	—	$	203,110	$	—
Commercial Real Estate:
Owner Occupied		453		63		663		1,179		244,427		—		245,606		—
Non-Owner Occupied		—		—		8		8		592,214		—		592,222		—
Residential Real Estate		2,399		198		1,775		4,372		458,193		467		463,032		—
Real Estate Construction		—		—		—		—		155,825		—		155,825		—
Farm Real Estate		—		—		7		7		34,107		—		34,114		—
Consumer and Other		129		46		—		175		14,886		—		15,061		—
Total	$	3,008	$	342	$	2,559	$	5,909	$	1,702,594	$	467	$	1,708,970	$	—

December 31, 2018	30-59 Days Past Due		60-89 Days Past Due		90 Days or Greater		Total Past Due		Current		Purchased Credit- Impaired Loans		Total Loans		Past Due 90 Days and Accruing
Commercial & Agriculture	$	225	$	—	$	92	$	317	$	176,743	$	41	$	177,101	$	—
Commercial Real Estate:
Owner Occupied		547		413		564		1,524		208,597		—		210,121		—
Non-Owner Occupied		288		290		372		950		522,648		—		523,598		—
Residential Real Estate		7,118		677		806		8,601		448,366		883		457,850		—
Real Estate Construction		—		12		27		39		135,156		—		135,195		—
Farm Real Estate		33		—		158		191		38,322		—		38,513		—
Consumer and Other		117		57		9		183		19,380		—		19,563		—
Total	$	8,328	$	1,449	$	2,028	$	11,805	$	1,549,212	$	924	$	1,561,941	$	—

Summary of Nonaccrual Loans Excluding Purchased Credit-Impaired (PCI) Loans

The following table presents loans on nonaccrual status, excluding purchased credit-impaired (PCI) loans, as of December 31, 2019 and 2018.

	2019		2018
Commercial & Agriculture	$	173	$	270
Commercial Real Estate:
Owner Occupied		938		942
Non-Owner Occupied		8		374
Residential Real Estate		4,183		3,886
Real Estate Construction		9		41
Farm Real Estate		284		338
Consumer and Other		4		18
Total	$	5,599	$	5,869

Schedule of TDR

Loan modifications that are considered TDRs completed during the twelve month periods ended December 31, 2019, 2018 and 2017 were as follows:

	For the Twelve Month Period Ended December 31, 2019
	Number of Contracts		Pre- Modification Outstanding Recorded Investment		Post- Modification Outstanding Recorded Investment
Commercial & Agriculture		—	$	—	$	—
Commercial Real Estate:
Owner Occupied		—		—		—
Non-Owner Occupied		1		382		382
Residential Real Estate		—		—		—
Real Estate Construction		—		—		—
Farm Real Estate		—		—		—
Consumer and Other		—		—		—
Total Loan Modifications		1	$	382	$	382

	For the Twelve Month Period Ended December 31, 2018
	Number of Contracts		Pre- Modification Outstanding Recorded Investment		Post- Modification Outstanding Recorded Investment
Commercial & Agriculture		—	$	—	$	—
Commercial Real Estate:
Owner Occupied		—		—		—
Non-Owner Occupied		—		—		—
Residential Real Estate		1		23		23
Real Estate Construction		—		—		—
Farm Real Estate		1		110		110
Consumer and Other		—		—		—
Total Loan Modifications		2	$	133	$	133

	For the Twelve Month Period Ended December 31, 2017
	Number of Contracts		Pre- Modification Outstanding Recorded Investment		Post- Modification Outstanding Recorded Investment
Commercial & Agriculture		—	$	—	$	—
Commercial Real Estate:
Owner Occupied		—		—		—
Non-Owner Occupied		—		—		—
Residential Real Estate		1		13		13
Real Estate Construction		—		—		—
Farm Real Estate		—		—		—
Consumer and Other		—		—		—
Total Loan Modifications		1	$	13	$	13

Impaired Financing Receivables Excluding PCI Loans

The following table includes the recorded investment and unpaid principal balances for impaired financing receivables, excluding PCI loans, with the associated allowance amount, if applicable, as of December 31, 2019 and 2018.

	December 31, 2019						December 31, 2018
	Recorded Investment		Unpaid Principal Balance		Related Allowance		Recorded Investment		Unpaid Principal Balance		Related Allowance
With no related allowance recorded:
Commercial & Agriculture	$	367	$	367			$	367	$	367
Commercial Real Estate:
Owner Occupied		168		168				193		193
Non-Owner Occupied		374		374				31		34
Residential Real Estate		1,571		1,643				1,017		1,089
Farm Real Estate		666		666				256		256
Total		3,146		3,218				1,864		1,939
With an allowance recorded:
Commercial Real Estate:
Owner Occupied		258		258	$	9		291		291	$	12
Residential Real Estate		193		197		82		262		265		122
Farm Real Estate		—		—		—		440		440		7
Total		451		455		91		993		996		141
Total:
Commercial & Agriculture		367		367		—		367		367		—
Commercial Real Estate:
Owner Occupied		426		426		9		484		484		12
Non-Owner Occupied		374		374		—		31		34		—
Residential Real Estate		1,764		1,840		82		1,279		1,354		122
Farm Real Estate		666		666		—		696		696		7
Total	$	3,597	$	3,673	$	91	$	2,857	$	2,935	$	141

The following tables include the average recorded investment and interest income recognized for impaired financing receivables as of, and for the years ended, December 31, 2019, 2018 and 2017.

For the year ended:	December 31, 2019				December 31, 2018
	Average Recorded Investment		Interest Income Recognized		Average Recorded Investment		Interest Income Recognized
Commercial & Agriculture	$	367	$	33	$	636	$	25
Commercial Real Estate:
Owner Occupied		456		32		610		33
Non-Owner Occupied		308		20		39		5
Residential Real Estate		1,271		58		1,519		75
Farm Real Estate		683		29		716		29
Total	$	3,085	$	172	$	3,520	$	167

For the year ended:	December 31, 2017
	Average Recorded Investment		Interest Income Recognized
Commercial & Agriculture	$	1,375	$	34
Commercial Real Estate:
Owner Occupied		1,507		75
Non-Owner Occupied		233		6
Residential Real Estate		1,515		73
Farm Real Estate		613		28
Total	$	5,243	$	216

Schedule of Changes in Amortized Yield for PCI Loans

Changes in the amortizable yield for PCI loans were as follows, since acquisition:

	At December 31, 2019			At December 31, 2018
	(In Thousands)			(In Thousands)
Balance at beginning of period	$	336		$	15
Acquisition of PCI loans		—			334
Accretion		(164	)		(13	)
Transfers from non-accretable to accretable		83			—
Balance at end of period	$	255		$	336

Schedule of Loans Acquired and Accounted

The following table presents additional information regarding loans acquired and accounted for in accordance with ASC 310-30:

	At December 31, 2019		At December 31, 2018
	Acquired Loans with Specific Evidence of Deterioration of Credit Quality (ASC 310-30)		Acquired Loans with Specific Evidence of Deterioration of Credit Quality (ASC 310-30)
	(In Thousands)
Outstanding balance	$	1,149	$	1,805
Carrying amount		467		924