Loans (Tables)

12 Months Ended

Dec. 31, 2021

Loans and Leases Receivable, Net Amount [Abstract]

Schedule of loans receivable

Loans receivable consist of the following:

	December 31, 2021			December 31, 2020
	(In Thousands)
Real Estate:
Residential	$	1,167,466		$	1,201,051
Commercial		2,450,349			2,383,001
Construction		862,815			667,649
		4,480,630			4,251,701
Other Loans:
Commercial		895,638			1,202,353
Home equity and improvement		264,354			272,701
Consumer Finance		126,417			120,729
		1,286,409			1,595,783
Total loans		5,767,039			5,847,484
Deduct:
Undisbursed loan funds		(477,890	)		(355,065	)
Net deferred loan origination fees and costs		7,019			(1,179	)
Allowance for credit loss		(66,468	)		(82,079	)
Totals	$	5,229,700		$	5,409,161

Schedule of allowance for loan loss activity

The following tables disclose the annual activity in the allowance for credit losses for the periods indicated by portfolio segment (in thousands):

Year ended December 31, 2021	Residential Real Estate			Commercial Real Estate			Construction		Commercial			Home Equity and Improvement			Consumer Finance			Total
Beginning Allowance	$	17,534		$	43,417		$	2,741	$	11,665		$	4,739		$	1,983		$	82,079
Charge-Offs		(110	)		(3,776	)		—		(6,960	)		(63	)		(476	)		(11,385	)
Recoveries		261			438			—		1,321		248			239				2,507
Provision expense (recovery)		(5,656	)		(7,680	)		263		7,384			(703	)		(341	)		(6,733	)
Ending Allowance	$	12,029		$	32,399		$	3,004	$	13,410		$	4,221		$	1,405		$	66,468

Year ended December 31, 2020	Residential Real Estate			Commercial Real Estate			Construction			Commercial			Home Equity and Improvement			Consumer Finance			Total
Beginning Allowance	$	2,867		$	16,302		$	996		$	9,003		$	1,700		$	375		$	31,243
Impact of ASC 326 Adoption		1,765			3,682			(223	)		(2,263	)		(521	)		(86	)		2,354
Acquisition related allowance for credit loss (PCD)		1,077			4,053			—			2,272			248			48			7,698
Charge-Offs		(307	)		(4,237	)		(1	)		(1,350	)		(164	)		(293	)		(6,352	)
Recoveries		342			1,352			—			1,850		262			176				3,982
Provision expense (recovery) (1)		11,790			22,265			1,969			2,153			3,214			1,763			43,154
Ending Allowance	$	17,534		$	43,417		$	2,741		$	11,665		$	4,739		$	1,983		$	82,079

(1)Provision for the twelve months ended December 31, 2020, includes $25.9 million as a result of the Merger with UCFC in the first quarter.

Year ended December 31, 2019	Residential Real Estate			Commercial Real Estate			Construction		Commercial			Home Equity and Improvement			Consumer Finance			Total
Beginning Allowance	$	2,881		$	15,142		$	682	$	7,281		$	2,026		$	319		$	28,331
Charge-Offs		(515	)		(148	)		—		(528	)		(245	)		(289	)		(1,725	)
Recoveries		193			645			—		642			184			68			1,732
Provision expense (recovery)		308			663			314		1,608			(265	)		277			2,905
Ending Allowance	$	2,867		$	16,302		$	996	$	9,003		$	1,700		$	375		$	31,243

Schedule of current balance of the aggregate amounts of non-performing assets, comprised of non-performing loans and real estate owned

he following table presents the current balance of the aggregate amounts of non-performing assets, comprised of non-performing loans and real estate owned as of the dates indicated:

	December 31, 2021		December 31, 2020
	(In Thousands)
Non-accrual loans with reserve	$	35,480	$	34,939
Non-accrual loans without reserve	$	12,534	$	16,743
Loans over 90 days past due and still accruing		—		—
Total non-performing loans		48,014		51,682
Real estate and other assets held for sale		171		343
Total non-performing assets	$	48,185	$	52,025
Troubled debt restructuring, still accruing	$	7,768	$	7,173

Schedule of aging of the recorded investment in past due and non- accrual loans

The following table presents the aging of the recorded investment in past due and non-accrual loans as of December 31, 2021, by class of loans (in thousands):

	Current		30-59 days		60-89 days		90+ days		Total Past Due		Total Non Accrual
Real Estate:
Residential		1,144,533		234		5,340		7,487		13,061		9,034
Commercial		2,439,552		96		847		7,168		8,111		14,621
Construction		383,136		43		1,746		—		1,789		—
Other Loans:
Commercial		884,025		42		35		867		944		11,531
Home equity and improvement		257,055		1,851		408		1,634		3,893		2,051
Consumer finance		124,073		1,112		819		1,728		3,659		1,873
PCD		25,111		225		1,005		5,996		7,226		8,904
Total Loans	$	5,257,485	$	3,603	$	10,200	$	24,880	$	38,683	$	48,014

The following table presents the aging of the recorded investment in past due and non-accrual loans as of December 31, 2020, by class of loans (in thousands):

	Current		30-59 days		60-89 days		90+ days		Total Past Due		Total Non Accrual
Real Estate:
Residential		1,173,979		433		7,669		9,000		17,102		10,178
Commercial		2,357,909		1,033		369		844		2,246		11,980
Construction		310,152		—		1,626		806		2,432		806
Other Loans:
Commercial		1,172,636		9		4		394		407		1,365
Home equity and improvement		262,373		3,440		839		1,137		5,416		1,537
Consumer finance		117,088		1,687		491		1,521		3,699		1,624
PCD		50,218		402		1,882		13,299		15,583		24,192
Total Loans	$	5,444,355	$	7,004	$	12,880	$	27,001	$	46,885	$	51,682

Summary of active breakout of deferrals by loan category

A breakout of active deferrals by loan category as of December 31, 2020, is as follows (in thousands):

	Balance deferred		Balance deferred
	As of December 31,		As of December 31,
	2021		2020
Residential real estate	$	-	$	7,016
Commercial real estate		-		34,831
Construction		-		9,579
Commercial		-		1,628
Home equity and improvement		-		114
Consumer finance		-		282
Total	$	-	$	53,450

Schedule of present loans by class modified as TDRs that occurred

The following table presents loans by class modified as TDRs that occurred during the years indicated (Dollars in Thousands):

	Loans Modified as a TDR for the Twelve Months Ended December 31, 2021				Loans Modified as a TDR for the Twelve Months Ended December 31, 2020				Loans Modified as a TDR for the Twelve Months Ended December 31, 2019
	($ in thousands)				($ in thousands)				($ in thousands)
Troubled Debt Restructurings:	Number of Loans		Recorded Investment (as of period end)		Number of Loans		Recorded Investment (as of period end)		Number of Loans		Recorded Investment (as of period end)
Real Estate:
Residential		6	$	685		7	$	892		12	$	1,332
Commercial		—		—		6		7,760		2		621
Construction		—		—		—		—		—		—
Other Loans:
Commercial		8		2,888		9		7,546		5		317
Home equity and improvement		—		—		4		92		1		25
Consumer finance		2		7		—		—		—		—
Total		16	$	3,580		26	$	16,290		20	$	2,295

Schedule of present loans by class modified as TDRs for which there was a payment default within twelve months

The following table presents loans by class modified as TDRs for which there was a payment default within twelve months following the modification during the indicated:

	Loans Modified as a TDR for the Twelve Months Ended December 31, 2021				Loans Modified as a TDR for the Twelve Months Ended December 31, 2020				Loans Modified as a TDR for the Twelve Months Ended December 31, 2019
	($ in thousands)				($ in thousands)				($ in thousands)
TDRs That Subsequently Defaulted:	Number of Loans		Recorded Investment (as of period end)		Number of Loans		Recorded Investment (as of period end)		Number of Loans		Recorded Investment (as of period end)
Real Estate:
Residential		1	$	32		2	$	229		—	$	—
Commercial		—		—		—		—		1		81
Construction		—		—		—		—		—		—
Other Loans:
Commercial		—		—		—		—		3		2,248
Home equity and improvement		—		—		—		—		—		—
Consumer finance		1		5		—		—		—		—
Total		2	$	37		2	$	229		4	$	2,329

Schedule of risk category of loans by class of loans

As of December 31, 2021, and based on the most recent analysis performed, the risk category and recorded investment in loans is as follows (in thousands):

Class	Unclassified		Special Mention		Substandard		Doubtful		Total classified		Total
Real Estate:
Residential		1,146,212		1,316		10,066		—		10,066		1,157,594
Commercial		2,324,846		93,676		29,141		—		29,141		2,447,663
Construction		365,403		19,522		—		—		—		384,925
Other Loans:
Commercial		856,402		14,815		13,752		—		13,752		884,969
Home equity and improvement		258,914		—		2,034		—		2,034		260,948
Consumer finance		125,879		—		1,853		—		1,853		127,732
PCD		19,547		101		12,689		—		12,689		32,337
Total Loans	$	5,097,203	$	129,430	$	69,535	$	—	$	69,535	$	5,296,168

As of December 31, 2020, and based on the most recent analysis performed, the risk category of loans by class of loans is as follows (in thousands):

Class	Unclassified		Special Mention		Substandard		Doubtful		Total classified		Total
Real Estate:
Residential		1,187,923		795		2,363		—		2,363		1,191,081
Commercial		2,203,652		111,039		45,464		—		45,464		2,360,155
Construction		299,866		12,718		—		—		—		312,584
Other Loans:
Commercial		1,142,289		23,907		6,847		—		6,847		1,173,043
Home equity and improvement		267,350		—		439		—		439		267,789
Consumer finance		120,682		—		105		—		105		120,787
PCD		26,829		3,813		35,159		—		35,159		65,801
Total Loans	$	5,248,591	$	152,272	$	90,377	$	—	$	90,377	$	5,491,240

Summary of amortized cost basis of loans by vintage credit quality indicator and class of loans

The table below presents the amortized cost basis of loans by vintage, credit quality indicator and class of loans as of December 31, 2021 and 2020 (in thousands):

	Term of loans by origination
	2021		2020		2019		2018		2017		Prior		Revolving Loans		Total
As of December 31, 2021
Real Estate
Residential:
Risk Rating
Pass	$	219,006	$	373,439	$	112,781	$	65,544	$	71,794	$	301,735	$	1,913	$	1,146,212
Special Mention		—		190		—		—		59		109		958		1,316
Substandard		465		780		1,198		1,006		2,095		4,522		—		10,066
Doubtful		—		—		—		—		—		—		—		—
Total	$	219,471	$	374,409	$	113,979	$	66,550	$	73,948	$	306,366	$	2,871	$	1,157,594
Commercial:
Risk Rating
Pass	$	514,333	$	493,575	$	388,117	$	230,734	$	237,712	$	451,113	$	9,262	$	2,324,846
Special Mention		294		5,349		5,533		11,055		49,993		20,662		790		93,676
Substandard		172		570		4,920		5,525		62		17,665		227		29,141
Doubtful		—		—		—		—		—		—		—		—
Total	$	514,799	$	499,494	$	398,570	$	247,314	$	287,767	$	489,440	$	10,279	$	2,447,663
Construction:
Risk Rating
Pass	$	198,221	$	100,606	$	55,707	$	10,039	$	685	$	145	$	-	$	365,403
Special Mention		—		12,500		—		5,996		1,026		—		—		19,522
Substandard		—		—		—		—		—		—		—		—
Doubtful		—		—		—		—		—		—		—		—
Total	$	198,221	$	113,106	$	55,707	$	16,035	$	1,711	$	145	$	-	$	384,925
Other Loans
Commercial:
Risk Rating
Pass	$	293,644	$	132,703	$	84,668	$	47,421	$	24,269	$	17,038	$	256,659	$	856,402
Special Mention		—		2,180		4,094		272		1,264		4,663		2,342		14,815
Substandard		136		11,550		23		288		388		131		1,236		13,752
Doubtful		—		—		—		—		—		—		—		—
Total	$	293,780	$	146,433	$	88,785	$	47,981	$	25,921	$	21,832	$	260,237	$	884,969
Home equity and Improvement:
Risk Rating
Pass	$	24,707	$	6,870	$	4,867	$	2,879	$	5,534	$	31,317	$	182,740	$	258,914
Special Mention		—		—		—		—		—		—		—		—
Substandard		15		—		28		48		27		690		1,226		2,034
Doubtful		—		—		—		—		—		—		—		—
Total	$	24,722	$	6,870	$	4,895	$	2,927	$	5,561	$	32,007	$	183,966	$	260,948
Consumer Finance:
Risk Rating
Pass	$	50,202	$	25,866	$	23,000	$	9,643	$	4,313	$	2,769	$	10,086	$	125,879
Special Mention		—		—		—		—		—		—		—		—
Substandard		196		707		619		129		67		131		4		1,853
Doubtful		—		—		—		—		—		—		—		—
Total	$	50,398	$	26,573	$	23,619	$	9,772	$	4,380	$	2,900	$	10,090	$	127,732
PCD:
Risk Rating
Pass	$	-	$	-	$	170	$	1,753	$	1,860	$	12,496	$	3,268	$	19,547
Special Mention		—		—		—		—		—		101		—		101
Substandard		—		—		67		28		3,242		6,490		2,862		12,689
Doubtful		—		—		—		—		—		—		—		—
Total	$	-	$	-	$	237	$	1,781	$	5,102	$	19,087	$	6,130	$	32,337

	Term of loans by origination
	2020		2019		2018		2017		2016		Prior		Revolving Loans		Total
As of December 31, 2020
Real Estate
Residential:
Risk Rating
Pass	$	250,979	$	196,158	$	136,247	$	130,759	$	137,581	$	333,572	$	2,627	$	1,187,923
Special Mention		199		—		—		62		116		211		207		795
Substandard		—		74		289		252		136		1,612				2,363
Doubtful		—		—		—		—		—		—		—		—
Total	$	251,178	$	196,232	$	136,536	$	131,073	$	137,833	$	335,395	$	2,834	$	1,191,081
Commercial:
Risk Rating
Pass	$	517,691	$	457,905	$	299,072	$	300,573	$	198,247	$	414,082	$	16,082	$	2,203,652
Special Mention		6,014		7,239		10,452		60,712		7,977		17,723		922		111,039
Substandard		—		279		18,851		1,937		3,143		19,107		2,147		45,464
Doubtful		—		—		—		—		—		—		—		—
Total	$	523,705	$	465,423	$	328,375	$	363,222	$	209,367	$	450,912	$	19,151	$	2,360,155
Construction:
Risk Rating
Pass	$	101,616	$	100,553	$	82,972	$	11,666	$	2,911	$	148	$	-	$	299,866
Special Mention		5,587		—		7,131		—		—		—		—		12,718
Substandard		—		—		—		—		—		—		—		—
Doubtful		—		—		—		—		—		—		—		—
Total	$	107,203	$	100,553	$	90,103	$	11,666	$	2,911	$	148	$	-	$	312,584
Other Loans
Commercial:
Risk Rating
Pass	$	568,678	$	144,977	$	82,492	$	42,421	$	21,262	$	21,969	$	260,490	$	1,142,289
Special Mention		1,180		2,026		2,514		2,109		37		5,121		10,920		23,907
Substandard		148		201		497		543		257		269		4,932		6,847
Doubtful		—		—		—		—		—		—		—		—
Total	$	570,006	$	147,204	$	85,503	$	45,073	$	21,556	$	27,359	$	276,342	$	1,173,043
Home equity and Improvement:
Risk Rating
Pass	$	8,736	$	7,483	$	4,508	$	7,963	$	7,748	$	31,382	$	199,530	$	267,350
Special Mention		—		—		—		—		—		—		—		—
Substandard		—		—		—		—		—		86		353		439
Doubtful		—		—		—		—		—		—		—		—
Total	$	8,736	$	7,483	$	4,508	$	7,963	$	7,748	$	31,468	$	199,883	$	267,789
Consumer Finance:
Risk Rating
Pass	$	38,665	$	37,601	$	19,401	$	10,607	$	4,393	$	3,272	$	6,743	$	120,682
Special Mention		—		—		—		—		—		—		—		—
Substandard		—		98		3		—		4		—		—		105
Doubtful		—		—		—		—		—		—		—		—
Total	$	38,665	$	37,699	$	19,404	$	10,607	$	4,397	$	3,272	$	6,743	$	120,787
PCD:
Risk Rating
Pass	$	-	$	45	$	2,378	$	2,547	$	1,524	$	18,998	$	1,337	$	26,829
Special Mention		—		—		—		1,160		509		1,758		386		3,813
Substandard		—		—		—		14,371		2,502		7,207		11,079		35,159
Doubtful		—		—		—		—		—		—		—		—
Total	$	-	$	45	$	2,378	$	18,078	$	4,535	$	27,963	$	12,802	$	65,801

Summary of credit loss estimation

The Company has identified the following portfolio segments and is generally utilizing two methodologies to analyze loan pools: discounted cash flow (“DCF”) and probability of default/loss given default (“PD/LGD”):

Portfolio Segments	Loan Pool	Methodology	Loss Drivers
Residential real estate	1-4 Family nonowner occupied	DCF	National unemployment
	1-4 Family owner occupied	DCF	National unemployment
Commercial real estate	Commercial real estate nonowner occupied	DCF	National unemployment
	Commercial real estate owner occupied	DCF	National unemployment
	Multi Family	DCF	National unemployment
	Agriculture Land	DCF	National unemployment
	Other commercial real estate	DCF	National unemployment
Construction secured by real estate	Construction	PD/LGD	Call report loss history
Commercial	Commercial working capital	PD/LGD	Call report loss history
	Agriculture production	PD/LGD	Call report loss history
	Other commercial	PD/LGD	Call report loss history
Home equity and improvement	Home equity and improvement	PD/LGD	Call report loss history
Consumer finance	Consumer finance	Remaining life	Call report loss history

The remaining life method was selected for the consumer loan segment since the pool contains loans with many different structures and payment streams and collateral. The weighted average remaining life uses an average annual charge-off rate applied to the contractual term, further adjusted for estimated prepayments to determine the unadjusted historical charge-off rate for the remaining balance of assets.

Portfolio Segments	Loan Pool	Methodology	Loss Drivers
Residential real estate	1-4 Family nonowner occupied	DCF	National unemployment
	1-4 Family owner occupied	DCF	National unemployment
Commercial real estate	Commercial real estate nonowner occupied	DCF	National unemployment
	Commercial real estate owner occupied	DCF	National unemployment
	Multi Family	DCF	National unemployment
	Agriculture Land	DCF	National unemployment
	Other commercial real estate	DCF	National unemployment
Construction secured by real estate	Construction	PD/LGD	Call report loss history
Commercial	Commercial working capital	PD/LGD	Call report loss history
	Agriculture production	PD/LGD	Call report loss history
	Other commercial	PD/LGD	Call report loss history
Home equity and improvement	Home equity and improvement	PD/LGD	Call report loss history
Consumer finance	Consumer finance	Remaining life	Call report loss history

Schedule of par value of purchased loans

Par value of purchased loans was as follows (in thousands):

	Year ended December 31, 2020
Par value of acquired loans at acquisition	$	2,247,317
Credit discount		(34,610	)
Non-credit (discount)/premium at acquisition		8,497
Purchase price of loans at acquisition	$	2,221,204

Schedule of outstanding balance and related allowance on loans

The outstanding balance at December 31, 2021 and related allowance on these loans is as follows (in thousands):

	As of December 31, 2021				As of December 31, 2020
	Loan Balance		ACL Balance		Loan Balance		ACL Balance
	(Dollars In Thousands)
Real Estate:
Residential	$	13,396	$	197	$	14,895	$	201
Commercial		5,878		151		24,334		2,286
Construction		—		—		—		—
		19,274		348		39,229		2,487
Other Loans:
Commercial		9,167		1,531		20,990		1,896
Home equity and improvement		3,405		154		4,912		214
Consumer finance		491		7		670		20
		13,063		1,692		26,572		2,130
Total	$	32,337	$	2,040	$	65,801	$	4,617

Schedule of loan allocated to executive officers directors and their affiliates

Loans to executive officers, directors, and their affiliates are as follows:

	Years Ended December 31,
	2021			2020
	(Dollars In Thousands)
Beginning balance	$	23,384		$	21,849
New loans		11,603			14,913
Effect of changes in composition of related parties		(100	)		883
Repayments		(16,461	)		(14,261	)
Ending Balance	$	18,426		$	23,384