| LOANS AND ALLOWANCE FOR CREDIT LOSSES | 5. LOANS
AND ALLOWANCE FOR CREDIT LOSSES Major
classifications of loans as of the dates indicated were as follows:
September 30, December 31,
2023 2022
(In thousands)
Commercial real estate $ 1,080,361 $ 1,069,323
Residential real estate:
Residential one-to-four family 606,221 589,503
Home equity 107,561 105,557
Total residential real estate 713,782 695,060
Commercial and industrial:
Paycheck Protection Program (“PPP”) loans 1,415 2,274
Commercial and industrial 211,162 217,574
Total commercial and industrial 212,577 219,848
Consumer 5,768 5,045
Total gross loans 2,012,488 1,989,276
Unamortized PPP loan fees (70 ) (109 )
Unearned premiums and deferred loan fees and costs, net 2,402 2,233
Total loans, net 2,014,820 1,991,400
Allowance for credit losses (1) (19,978 ) (19,931 )
Net loans $ 1,994,842 $ 1,971,469
(1) The
Company adopted ASU 2016-13 on January 1, 2023 with a modified retrospective approach. Accordingly,
beginning at January 1, 2023, the allowance for credit losses was determined in accordance
with ASC 326, “ Financial Instruments-Credit Losses Loans
Serviced for Others. The
Company has transferred a portion of its originated commercial loans to participating lenders. The amounts transferred have been accounted
for as sales and are therefore not included in our accompanying consolidated balance sheets. We continue to service the loans on behalf
of the participating lenders. We share with participating lenders, on a pro-rata basis, any gains or losses that may result from a borrower’s
lack of compliance with contractual terms of the loan. At September 30, 2023 and December 31, 2022, the Company was servicing commercial
loans participated out to various other institutions totaling $ 65.6 70.5 Residential
real estate mortgages are originated by the Company both for its portfolio and for sale into the secondary market. The Company may sell
its loans to institutional investors such as the FHLMC. Under loan sale and servicing agreements with the investor, the Company generally
continues to service the residential real estate mortgages. The Company pays the investor an agreed upon rate on the loan, which is less
than the interest rate received from the borrower. The Company retains the difference as a fee for servicing the residential real estate
mortgages. The Company capitalizes mortgage servicing rights at their fair value upon sale of the related loans, amortizes the asset
over the estimated life of the serviced loan, and periodically assesses the asset for impairment. The significant assumptions used by
a third party to estimate the fair value of capitalized servicing rights at September 30, 2023, include weighted average prepayment speed
for the portfolio using the Public Securities Association Standard Prepayment Model ( 100 10.01 0.25 83.75 277,000 2,000 At
September 30, 2023 and December 31, 2022, the Company was servicing residential mortgage loans owned by investors totaling $ 74.4 79.3 144,000 158,000 A
summary of the activity in the balances of mortgage servicing rights follows:
Three Months Ended September 30, 2023 Nine Months Ended September 30, 2023
(In thousands)
Balance at the beginning of period: $ 480 $ 550
Amortization (35 ) (105 )
Balance at the end of period $ 445 $ 445
Fair value at the end of period $ 745 $ 745 Loans
are recorded at the principal amount outstanding, adjusted for charge-offs, unearned premiums and deferred loan fees and costs. Interest
on loans is calculated using the effective yield method on daily balances of the principal amount outstanding and is credited to income
on the accrual basis to the extent it is deemed collectable. Our general policy is to discontinue the accrual of interest when principal
or interest payments are delinquent 90 days or more based on the contractual terms of the loan, or earlier if there are concerns regarding
the collectability of the loan. Any unpaid amounts previously accrued on these loans are reversed from income. Subsequent cash receipts
are applied to the outstanding principal balance or to interest income if, in the judgment of management, collection of the principal
balance is not in question. Loans are returned to accrual status when they become current as to both principal and interest and perform
in accordance with contractual terms for a period of at least six months, reducing the concern as to the collectability of principal
and interest. Loan fees and certain direct loan origination costs are deferred, and the net fee or cost is recognized as an adjustment
to interest income over the estimated average lives of the related loans. Effect
of New Financial Accounting Standards. On
January 1, 2023, the Company adopted ASU 2016-13 Financial Instruments - Credit Losses Topic326 Measurement of Credit
Losses on Financial Instruments The
Company adopted ASC 326 using the modified retrospective method for all financial assets measured at amortized cost and off-balance sheet
credit exposures. Results for reporting periods beginning January 1, 2023 are presented under ASC 326 while prior period amounts continue
to be reported in accordance with previously applicable GAAP. The Company recorded a net increase to retained earnings of $ 9,000 ASC 326 4,000 1.2 918,000 The
following table illustrates the impact of ASC 326:
Pre-ASC 326 December 31, As Reported January 1, 2023 Impact of ASC
(In thousands)
Assets
Loans (1) $ 1,989,276 $ 1,991,389 $ 2,113
Allowance for credit losses on loans (2) (19,931 ) (21,113 ) (1,182 )
Deferred tax asset 15,027 15,023 (4 )
Liabilities
Allowance for credit losses on off-balance sheet exposures $ — $ (918 ) $ (918 )
Shareholders’
Equity
Retained earnings, net of tax $ (127,982 ) $ (127,991 ) $ (9 )
(1) Purchase
credit deteriorated (“PCD loans”) gross up of cost basis of loans totaled $ 422,000 1,691,000
(2) Increase
to allowance for credit losses on loans of $ 2,113,000 931,000 Allowance
for Credit Losses. The
allowance for credit losses is an estimate of expected losses inherent within the Company's existing loans held for investment portfolio.
The allowance for credit losses for loans held for investment, as reported in our consolidated balance sheet, is adjusted by a credit
loss expense, which is reported in earnings, and reduced by the charge-off of loan amounts, net of recoveries. Accrued interest receivable
on loans held for investment was $ 7.3 The
credit loss estimation process involves procedures to appropriately consider the unique characteristics of loan portfolio segments, which
consist of commercial real estate loans, residential real estate loans, commercial and industrial loans, and consumer loans. These segments
are further disaggregated into loan classes, the level at which credit risk is monitored. For each of these pools, the Company generates
cash flow projections at the instrument level wherein payment expectations are adjusted for estimated prepayment speed, curtailments,
time to recovery, probability of default, and loss given default. The modeling of expected prepayment speeds, curtailment rates, and
time to recovery are based on historical internal data. The quantitative component of the ACL on loans is model-based and utilizes a
forward-looking macroeconomic forecast. The Company uses a discounted cash flow method, incorporating probability of default and loss
given default forecasted based on statistically derived economic variable loss drivers, to estimate expected credit losses. This process
includes estimates which involve modeling loss projections attributable to existing loan balances, and considering historical experience,
current conditions, and future expectations for pools of loans over a reasonable and supportable forecast period. The historical information
either experienced by the Company or by a selection of peer banks, when appropriate, is derived from a combination of recessionary and
non-recessionary performance periods for which data is available. Commercial
real estate loans Residential
real estate loans 97 90 85 80 85 Commercial
and industrial loans Consumer
loans Discounted
cash flow method (“DCF”) In
estimating the component of the allowance for credit losses for loans that share similar risk characteristics with other loans, such
loans are segregated into loan classes. Loans are designated into loan classes based on loans pooled by product types and similar risk
characteristics or areas of risk concentration. In determining the allowance for credit losses, we derive an estimated credit loss assumption
from a model that categorizes loan pools based on loan type and purpose. This model calculates an expected loss percentage for each loan
class by considering the probability of default, using life-of-loan analysis periods for all loan segments, and the historical severity
of loss, based on the aggregate net lifetime losses incurred per loan class. The default and severity factors used to calculate the allowance
for credit losses for loans that share similar risk characteristics with other loans are adjusted for differences between the historical
period used to calculate historical default and loss severity rates and expected conditions over the remaining lives of the loans in
the portfolio related to: (1) lending policies and procedures; (2) international, national, regional and local economic business conditions
and developments that affect the collectability of the portfolio; (3) the nature and volume of the loan portfolio including the terms
of the loans; (4) the experience, ability, and depth of the lending management and other relevant staff; (5) the volume and severity
of past due and adversely classified loans and the volume of nonaccrual loans; (6) the quality of our loan review system and (7) the
value of underlying collateral for collateralized loans. Additional factors include the existence and effect of any concentrations of
credit, and changes in the level of such concentrations and the effect of external factors such as competition and legal and regulatory
requirements on the level of estimated credit losses in the existing portfolio. Such factors are used to adjust the historical probabilities
of default and severity of loss so that they reflect management expectation of future conditions based on a reasonable and supportable
forecast. The Company uses regression analysis of historical internal and peer data to determine which variables are best suited to be
economic variables utilized when modeling lifetime probability of default and loss given default. This analysis also determines how expected
probability of default and loss given default will react to forecasted levels of the economic variables. For
all DCF models, management has determined that four quarters represents a reasonable and supportable forecast period and reverts back
to a historical loss rate over four quarters on a straight-line basis. Other internal and external indicators of economic forecasts are
also considered by management when developing the forecast metrics. Individually
evaluated financial assets For
a loan that does not share risk characteristics with other loans, expected credit loss is measured based on net realizable value, that
is, the difference between the discounted value of the expected future cash flows, based on the original effective interest rate, and
the amortized cost basis of the loan. For these loans, we recognize expected credit loss equal to the amount by which the net realizable
value of the loan is less than the amortized cost basis of the loan (which is net of previous charge-offs and deferred loan fees and
costs), except when the loan is collateral dependent, that is, when the borrower is experiencing financial difficulty and repayment is
expected to be provided substantially through the operation or sale of the collateral. In these cases, expected credit loss is measured
as the difference between the amortized cost basis of the loan and the fair value of the collateral. The fair value of the collateral
is adjusted for the estimated cost to sell if repayment or satisfaction of a loan is dependent on the sale (rather than only on the operation)
of the collateral. Purchased
Credit Deteriorated Loans The
Company has loans acquired with evidence of credit deterioration from Chicopee Bancorp, Inc. Prior to the adoption of CECL, these loans
were accounted for under accounting guidance for purchased credit-impaired (“PCI”) loans. The Company did not elect the practical
expedient to maintain pool accounting for these loans and will measure credit loss at the loan level. Upon
adoption of ASC 326, PCI loans are accounted for as purchase credit deteriorated (“PCD loans”). PCD loans are recorded at
the amount paid. An allowance for credit losses is determined using the same methodology as other loans held for investment. The initial
allowance for credit losses determined on a collective basis is allocated to individual loans. The sum of the loan’s purchase price
and allowance for credit losses becomes its initial amortized cost basis. The difference between the initial amortized cost basis and
the par value of the loan is a noncredit discount or premium, which is amortized into interest income over the life of the loan. Subsequent
changes to the allowance for credit losses are recorded through credit loss expense. Allowance
for credit losses on off-balance sheet credit exposures, including unfunded loan commitments The
Company maintains a separate allowance for credit losses from off-balance-sheet credit exposures, including unfunded loan commitments,
which is included in other liabilities on the balance sheet. Management estimates the amount of expected losses by calculating a commitment
usage factor over the contractual period for exposures that are not unconditionally cancellable by the Company and applying the loss
factors used in the ACL methodology to the results of the usage calculation to estimate the liability for credit losses related to unfunded
commitments for each loan type. No credit loss estimate is reported for off-balance-sheet credit exposures that are unconditionally cancellable
by the Company, such as undrawn amounts under such arrangements that may be drawn prior to the cancellation of the arrangement. The allowance
for credit losses on off-balance sheet credit exposures is adjusted as credit loss expense. Categories of off-balance sheet credit exposures
correspond to the loan portfolio segments described above. Management evaluates the need for a reserve on unfunded loan commitments in
a manner consistent with loans held for investment. An
analysis of changes in the allowance for credit losses by segment for the three and nine months ended September 30, 2023 and the allowance
for credit losses for the three and nine months ended September 30, 2022 is as follows:
Commercial Residential Commercial Consumer Unallocated Total
(In thousands)
Balance at June, 2023 (2) $ 15,752 $ 2,356 $ 1,487 $ 52 $ — $ 19,647
Provision (reversal) for credit losses (188 ) 31 551 15 — 409
Charge-offs — — (147 ) (46 ) — (193 )
Recoveries 9 2 77 27 — 115
Balance at September 30, 2023 (2) $ 15,573 $ 2,389 $ 1,968 $ 48 $ — $ 19,978
Balance at December 31, 2022 $ 12,199 $ 4,312 $ 3,160 $ 245 $ 15 $ 19,931
Cumulative effect of change in accounting principle (1) 3,989 (2,518 ) (75 ) (199 ) (15 ) 1,182
Adjusted Beginning Balance $ 16,188 $ 1,794 $ 3,085 46 — $ 21,113
Provision (reversal) for credit losses (211 ) 570 348 61 — 768
Charge-offs (414 ) — (1,561 ) (116 ) — (2,091 )
Recoveries 10 25 96 57 — 188
Balance at September 30, 2023 (2) $ 15,573 $ 2,389 $ 1,968 $ 48 $ — $ 19,978
Commercial Residential Commercial Consumer Unallocated Total
(In thousands)
Allowance for credit losses for off-balance sheet exposures
Balance at June 30, 2023 $ 395 $ 163 $ 33 $ — $ — $ 591
(Reversal of) provision for credit losses (79 ) 4 20 — — (55 )
Balance at September 30, 2023 $ 316 $ 167 $ 53 $ — $ — $ 536
Balance at December 31, 2022 $ — $ — $ — $ — $ — $ —
Cumulative effect of change in accounting principle 611 267 40 — — 918
Reversal of credit losses (295 ) (100 ) 13 — — (382 )
Balance at September 30, 2023 $ 316 $ 167 $ 53 $ — $ — $ 536
(1) Represents
the net adjustment needed to reflect the cumulative day one impact pursuant to the Company’s
adoption of ASU 2016-13 (i.e., cumulative effect adjustment related to the adoption of ASU
2016-13 as of January 1, 2023). The adjustment represents a $ 931,000 2,113,000
(2) The
balance of $ 7.3 6.8 The
$ 354,000 $409,000 55,000 55,000 6.7 3.7% $386,000 $768,000 382,000 382,000 36.2 The
following tables presents information pertaining to the allowance for credit losses by segment Pre-ASC 326 CECL adoption for the date
indicated:
Commercial Residential Commercial Consumer Unallocated Total
(In thousands)
Balance at June 30, 2022 $ 12,483 $ 4,164 $ 2,686 $ 210 $ 17 $ 19,560
Provision (credit) 68 86 481 53 (13 ) 675
Charge-offs — — — (59 ) — (59 )
Recoveries — — 14 18 — 32
Balance at September 30, 2022 $ 12,551 $ 4,250 $ 3,181 $ 222 $ 4 $ 20,208
Balance at December 31, 2021 $ 12,970 $ 3,964 $ 2,643 $ 197 $ 13 $ 19,787
Provision (credit) (382 ) 282 538 121 (9 ) 550
Charge-offs (37 ) (27 ) (22 ) (145 ) — (231 )
Recoveries — 31 22 49 — 102
Balance at September 30, 2022 $ 12,551 $ 4,250 $ 3,181 $ 222 $ 4 $ 20,208
Commercial Residential Commercial Consumer Unallocated Total
(In thousands)
December 31, 2022
Amount of allowance for impaired loans $ — $ — $ — $ — $ — $ —
Amount of allowance for non-impaired loans 12,199 4,312 3,160 245 15 19,931
Total allowance for credit losses $ 12,199 $ 4,312 $ 3,160 $ 245 $ 15 $ 19,931
Impaired loans $ 9,178 $ 3,623 $ 407 $ — $ — $ 13,208
Non-impaired loans 1,056,886 689,776 219,163 5,045 — 1,970,870
Impaired loans acquired with deteriorated credit quality 3,259 1,661 278 — — 5,198
Total loans $ 1,069,323 $ 695,060 $ 219,848 $ 5,045 $ — $ 1,989,276 Past
Due and Nonaccrual Loans. The
following tables present an age analysis of past due loans as of the dates indicated:
30 – 59 60 – 89 90 Days Total Past Due Total Current Total Loans Nonaccrual
(In thousands)
September 30, 2023
Commercial real estate $ 940 $ 92 $ 595 $ 1,627 $ 1,078,734 $ 1,080,361 $ 1,662
Residential real estate:
Residential one-to-four family 2,539 266 683 3,488 602,733 606,221 4,030
Home equity 83 100 13 196 107,365 107,561 130
Total: 2,622 366 696 3,684 710,098 713,782 4,160
Commercial and industrial 75 — 236 311 212,266 212,577 459
Consumer 2 — — 2 5,766 5,768 9
Total loans $ 3,639 $ 458 $ 1,527 $ 5,624 $ 2,006,864 $ 2,012,488 $ 6,290
December 31, 2022
Commercial real estate $ — $ 211 $ 1,404 $ 1,615 $ 1,067,708 $ 1,069,323 $ 1,933
Residential real estate:
Residential one-to-four family 1,768 100 414 2,282 587,221 589,503 3,290
Home equity 209 97 51 357 105,200 105,557 181
Total: 1,977 197 465 2,639 692,421 695,060 3,471
Commercial and industrial 170 10 22 202 219,646 219,848 290
Consumer 13 — — 13 5,032 5,045 —
Total loans $ 2,160 $ 418 $ 1,891 $ 4,469 $ 1,984,807 $ 1,989,276 $ 5,694 At
September 30, 2023 and December 31, 2022, total past due loans totaled $ 5.6 0.28 4.5 0.22 Nonaccrual
Loans. Accrual
of interest on loans is generally discontinued when contractual payment of principal or interest becomes past due 90 days or, if in management's
judgment, reasonable doubt exists as to the full timely collection of interest. Exceptions may be made if the loan has matured and is
in the process of renewal or is well-secured and in the process of collection. When a loan is placed on nonaccrual status, interest accruals
cease and uncollected accrued interest is reversed and charged against current interest income. Interest payments on nonaccrual loans
are generally applied to principal. If collection of the principal is reasonably assured, interest payments are recognized as income
on the cash basis. Loans are generally returned to accrual status when principal and interest payments are current, full collectability
of principal and interest is reasonably assured and a consistent record of at least six consecutive months of performance has been achieved. The
following table presents information regarding nonaccrual loans as of the date indicated:
As of September 30, 2023 (1) For the Nine
Nonaccrual Nonaccrual Total Nonaccrual Amortized Cost Accrued
(In thousands)
Commercial real estate (1) $ — $ 1,662 $ 1,662 $ — $ 85
Residential real estate: (1)
Residential (1) — 4,030 4,030 — 131
Home equity (1) — 130 130 — 9
Commercial and industrial (1) — 459 459 — 131
Consumer (1) — 9 9 — —
Total loans (1) $ — $ 6,290 $ 6,290 $ — $ 356
(1) The
Company adopted ASU 2016-13 as of January 1, 2023. At
September 30, 2023 and December 31, 2022, nonaccrual loans totaled $ 6.3 0.31 5.7 0.29 Individually
Evaluated Loans. In
connection with the adoption of ASU-2106-13, the Company no longer provides information on impaired loans. A loan is considered individually
evaluated when, based on current information and events, the borrower is experiencing financial difficulty and repayment, both principal
and interest, is expected to be provided substantially through the operation or sale of the collateral. At September 30, 2023, the Company
had $ 14.5 17.3 The
following table summarizes the Company’s individually evaluated loans
Recorded Related
(In thousands)
With no related allowance recorded:
Commercial real estate $ 11,256 $ —
Residential real estate:
Residential one-to-four family 5,936 —
Home equity 143 —
Commercial and industrial 13,989 —
Consumer 9 —
Loans with no related allowance recorded $ 31,333 $ —
With an allowance recorded:
Commercial real estate $ — $ —
Residential real estate:
Residential one-to-four family — —
Home equity — —
Commercial and industrial 517 179
Consumer — —
Loans with an allowance recorded $ 517 $ 179
Total individually evaluated loans $ 31,850 $ 179 Pre-ASC
326 CECL adoption impaired loan information as of December 31, 2022 is as follows:
Nine Months Ended
At December 31, 2022 September 30, 2022
Recorded Unpaid Related Average Interest
(In thousands)
Impaired Loans (1)
Commercial real estate $ 12,437 $ 13,795 $ — $ 13,648 $ 217
Residential real estate:
Residential one-to-four family 5,088 5,823 — 4,716 45
Home equity 196 214 — 162 1
Commercial and industrial 685 3,095 — 936 56
Consumer — — — 3 —
Total impaired loans $ 18,406 $ 22,927 $ — $ 19,465 $ 319
(1) Includes loans
acquired with deteriorated credit quality and performing troubled debt restructurings. Modified
Loans. Loans
are designated as modified when, as part of an agreement to modify the original contractual terms of the loan as a result of financial
difficulties of the borrower, the Company grants the borrower a concession on the terms that would not otherwise be considered. Typically,
such concessions may consist of a reduction in interest rate to a below market rate, taking into account the credit quality of the note,
extension of additional credit based on receipt of adequate collateral, or a deferment or reduction of payments (principal or interest)
which materially alters the Company's position or significantly extends the note's maturity date, such that the present value of cash
flows to be received is materially less than those contractually established at the loan's origination. There
were no loan modifications during the nine months ended September 30, 2023 and for the year ended December 31, 2022. During the nine
months ended September 30, 2023 and 2022, no modified loans defaulted (defined as 30 days or more past due) within 12 months of restructuring.
There were no charge-offs on modified loans during the nine months ended September 30, 2023 or 2022. Credit
Quality Information. The
Company utilizes an eight-grade internal loan rating system for commercial real estate and commercial and industrial loans. Performing
residential real estate, home equity and consumer loans are grouped with “Pass” rated loans. Nonperforming residential real
estate, home equity and consumer loans are risk rated as “substandard” and individually evaluated. Loans
rated 1 – 4 Loans
rated 5 Special Mention Loans
rated 6 Substandard Loans
rated 7 Doubtful Loans
rated 8 On
an annual basis, or more often if needed, we formally review the ratings on all commercial real estate and commercial and industrial
loans. In addition, management utilizes delinquency reports, the criticized loan report and other loan reports to monitor credit quality.
In addition, at least on an annual basis, the Company contracts with an external loan review company to review the internal credit ratings
assigned to loans in the commercial loan portfolio on a pre-determined schedule, based on the type, size, rating, and overall risk of
the loan. During the course of its review, the third party examines a sample of loans, including new loans, existing relationships over
certain dollar amounts and classified assets. The
following table details the amortized cost balances of the Company’s loan portfolio presented by risk rating
Term Loan Origination by Year Revolving Loans
September 30, 2023 2022 2021 2020 2019 Prior Revolving Loans Revolving Loans Converted to Term Loans Total
(Dollars in thousands)
Commercial Real Estate:
Pass (Rated 1- 4) $ 34,695 $ 176,724 $ 230,571 $ 115,495 $ 90,600 $ 330,324 $ 75,495 $ 6,005 $ 1,059,909
Special Mention (Rated 5) — — — 184 2,483 5,994 164 — 8,825
Substandard (Rated 6) — — — 8,142 — 3,485 — — 11,627
Total commercial real estate loans $ 34,695 $ 176,724 $ 230,571 $ 123,821 $ 93,083 $ 339,803 $ 75,659 $ 6,005 $ 1,080,361
Current period gross charge-offs $ — $ — $ — $ — $ — $ 414 $ — $ — $ 414
Payment Performance:
Performing $ 34,695 $ 176,724 $ 230,571 $ 123,821 $ 93,083 $ 338,141 $ 75,659 $ 6,005 $ 1,078,699
Nonperforming — — — — — 1,662 — — 1,662
Residential One-to-Four Family:
Pass $ 42,352 $ 87,316 $ 96,136 $ 128,473 $ 55,057 $ 181,613 $ 10,301 $ — $ 601,248
Substandard — 447 — 336 — 4,190 — — 4,973
Total residential one-to-four family $ 42,352 $ 87,763 $ 96,136 $ 128,809 $ 55,057 $ 185,803 $ 10,301 $ — $ 606,221
Current period gross charge-offs $ — $ — $ — $ — $ — $ — $ — $ — $ —
Payment Performance:
Performing $ 42,352 $ 87,316 $ 96,136 $ 128,473 $ 55,057 $ 182,556 $ 10,301 $ — $ 602,191
Nonperforming — 447 — 336 — 3,247 — — 4,030
Home Equity:
Pass $ 7,507 $ 11,362 $ 7,085 $ 7,312 $ 5,614 $ 7,722 $ 58,342 $ 2,487 $ 107,431
Substandard — — — — — — 92 38 130
Total home equity loans $ 7,507 $ 11,362 $ 7,085 $ 7,312 $ 5,614 $ 7,722 $ 58,434 $ 2,525 $ 107,561
Current period gross charge-offs $ — $ — $ — $ — $ — $ — $ — $ — $ —
Payment Performance:
Performing $ 7,507 $ 11,362 $ 7,085 $ 7,312 $ 5,614 $ 7,722 $ 58,342 $ 2,487 $ 107,431
Nonperforming — — — — — — 92 38 130
Term Loans Originated by Year Revolving Loans
September 30, 2022 2021 2020 2019 Prior Revolving Loans Revolving Total
(Dollars in thousands)
Commercial and Industrial:
Pass (Rated 1- 4) $ 20,989 $ 37,264 $ 25,984 $ 21,718 $ 20,586 $ 9,985 $ 55,938 $ 71 $ 192,535
Special Mention (Rated 5) — 111 157 — 19 605 2,268 — 3,160
Substandard (Rated 6) — — 1,506 8,581 4 19 6,772 — 16,882
Total commercial and industrial loans $ 20,989 $ 37,375 $ 27,647 $ 30,299 $ 20,609 $ 10,609 $ 64,978 $ 71 $ 212,577
Current period gross charge-offs $ — $ 147 $ — $ — $ — $ 221 $ — $ 1,193 $ 1,561
Payment Performance:
Performing $ 20,989 $ 37,375 $ 27,647 $ 30,299 $ 20,609 $ 10,601 $ 64,527 $ 71 $ 212,118
Nonperforming — — — — — 8 451 — 459
Consumer:
Pass $ 2,097 $ 1,633 $ 596 $ 322 $ 101 $ 209 $ 784 $ — $ 5,742
Substandard — — — — — 26 — — 26
Total consumer loans $ 2,097 $ 1,633 $ 596 $ 322 $ 101 $ 235 $ 784 $ — $ 5,768
Current period gross charge-offs $ — $ — $ — $ — $ — $ — $ 3 $ 113 $ 116
Payment Performance:
Performing $ 2,097 $ 1,633 $ 596 $ 322 $ 101 $ 227 $ 783 $ — $ 5,759
Nonperforming — — — — — 8 1 — 9 The
following table presents our loans by risk rating as of December 31, 2022 Pre-ASC 326 CECL adoption:
Commercial Real Residential Home Commercial Consumer Total
(In thousands)
December 31, 2022
Pass (Rated 1 - 4) $ 1,036,337 $ 585,292 $ 105,248 $ 193,415 $ 5,027 $ 1,925,319
Special Mention (Rated 5) 16,035 — — 5,623 — 21,658
Substandard (Rated 6) 16,951 4,211 309 20,810 18 42,299
Total $ 1,069,323 $ 589,503 $ 105,557 $ 219,848 $ 5,045 $ 1,989,276 |
