Loans | Note 4 — Loans Loans consist of the following: (Dollars in thousands) December 31, 2023 December 31, 2022 Loans held for sale $ 16,852 $ 49,957 LHFI: Loans secured by real estate: Commercial real estate (1) $ 2,442,734 $ 2,304,678 Construction/land/land development 1,070,225 945,625 Residential real estate 1,734,935 1,477,538 Total real estate 5,247,894 4,727,841 Commercial and industrial 2,059,460 2,051,161 Mortgage warehouse lines of credit 329,966 284,867 Consumer 23,624 26,153 Total LHFI (2) 7,660,944 7,090,022 Less: Allowance for loan credit losses (“ALCL”) 96,868 87,161 LHFI, net $ 7,564,076 $ 7,002,861 ____________________________ (1) Includes owner occupied commercial real estate of $953.8 million and $843.0 million at December 31, 2023, and December 31, 2022, respectively. (2) Includes unamortized purchase accounting adjustment and net deferred loan fees of $11.8 million and $14.2 million at December 31, 2023, and December 31, 2022, respectively. As of December 31, 2023, and December 31, 2022, the remaining purchase accounting net loan discount was $222,000 and $2.2 million, respectively. Credit quality indicators. As part of the Company’s commitment to managing the credit quality of its loan portfolio, management annually and periodically updates and evaluates certain credit quality indicators, which include but are not limited to (i) weighted-average risk rating of the loan portfolio, (ii) net charge-offs, (iii) level of non-performing loans, (iv) level of classified loans (defined as substandard, doubtful and loss), and (v) the general economic conditions particularly in the cities and states in which the Company operates. The Company maintains an internal risk rating system where ratings are assigned to individual loans based on assessed risk. Loan risk ratings are the primary indicator of credit quality for the loan portfolio and are continually evaluated to ensure they are appropriate based on currently available information. The following is a summary description of the Company’s internal risk ratings: • Pass (1-6) Loans within this risk rating are further categorized as follows: Minimal risk (1) Well-collateralized by cash equivalent instruments held by the Banks. Moderate risk (2) Borrowers with excellent asset quality and liquidity. Borrowers’ capitalization and liquidity exceed industry norms. Borrowers in this category have significant levels of liquid assets and have a low level of leverage. Better than average risk (3) Borrowers with strong financial strength and excellent liquidity that consistently demonstrate strong operating performance. Borrowers in this category generally have a sizable net worth that can be converted into liquid assets within 12 months. Average risk (4) Borrowers with sound credit quality and financial performance, including liquidity. Borrowers are supported by sufficient cash flow coverage generated through operations across the full business cycle. Marginally acceptable risk (5) Loans generally meet minimum requirements for an acceptable loan in accordance with lending policy, but possess one or more attributes that cause the overall risk profile to be higher than the majority of newly approved loans. Watch (6) A passing loan with one or more factors that identify a potential weakness in the overall ability of the borrower to repay the loan. These weaknesses are generally mitigated by other factors that reduce the risk of delinquency or loss. • Special Mention (7) This grade is intended to be temporary and includes borrowers whose credit quality has deteriorated and is at risk of further decline. • Substandard (8) This grade includes “Substandard” loans under regulatory guidelines. Substandard loans exhibit a well-defined weakness that jeopardizes debt repayment in accordance with contractual agreements, even though the loan may be performing. These obligations are characterized by the distinct possibility that a loss may be incurred if these weaknesses are not corrected and repayment may be dependent upon collateral liquidation or secondary source of repayment. • Doubtful (9) This grade includes “Doubtful” loans under regulatory guidelines. Such loans are placed on nonaccrual status and repayment may be dependent upon collateral with no readily determinable valuation or valuations that are highly subjective in nature. Repayment for these loans is considered improbable based on currently existing facts and circumstances. • Loss (0) This grade includes “Loss” loans under regulatory guidelines. Loss loans are charged-off or written down when repayment is not expected. In connection with the review of the loan portfolio, the Company considers risk elements attributable to particular loan types or categories in assessing the quality of individual loans. The list of loans to be reviewed for possible individual evaluation consists of unsecured loans over 90 days past due, modified loans to borrowers experiencing financial difficulty, loans greater than $100,000 in which the borrower has filed bankruptcy, collateralized loans 180 days or more past due, classified commercial loans, including non-accrual, over $100,000 with direct exposure, and consumer loans greater than $100,000 with a FICO score under 625. Loans under $50,000 will be evaluated collectively in designated pools unless a loss exposure has been identified. Some additional risk elements considered by loan type include: • for commercial real estate loans, the debt service coverage ratio, operating results of the owner in the case of owner-occupied properties, the loan to value ratio, the age and condition of the collateral and the volatility of income, property value and future operating results typical of properties of that type; • for construction, land and land development loans, the perceived feasibility of the project, including the ability to sell developed lots or improvements constructed for resale or the ability to lease property constructed for lease, the quality and nature of contracts for presale or prelease, if any, experience and ability of the developer and loan to value ratio; • for residential mortgage loans, the borrower’s ability to repay the loan, including a consideration of the debt to income ratio and employment and income stability, the loan-to-value ratio, and the age, condition and marketability of the collateral; and • for commercial and industrial loans, the debt service coverage ratio (income from the business in excess of operating expenses compared to loan repayment requirements), the operating results of the commercial, industrial or professional enterprise, the borrower’s business, professional and financial ability and expertise, the specific risks and volatility of income and operating results typical for businesses in that category and the value, nature and marketability of collateral. Purchased loans that have experienced more than insignificant credit deterioration since origination are PCD loans. An allowance for credit losses is determined using the same methodology as other individually evaluated loans. As a result of the merger with BT Holdings, Inc., (“BTH”), the Company held approximately $34.8 million and $48.1 million of unpaid principal balance PCD loans at December 31, 2023, and December 31, 2022, respectively. Please see Note 1 — Significant Accounting Policies included in these Notes to Consolidated Financial Statements for a description of our accounting policies related to purchased financial assets with credit deterioration. The following table reflects recorded investments in loans by credit quality indicator and origination year at December 31, 2023, and gross charge-offs for the year ended December 31, 2023, excluding loans held for sale. Loans acquired are shown in the table by origination year, not merger date. The Company had an immaterial amount of revolving loans converted to term loans at December 31, 2023. Term Loans Amortized Cost Basis by Origination Year (Dollars in thousands) 2023 2022 2021 2020 2019 Prior Revolving Loans Amortized Cost Basis Total Commercial real estate: Pass $ 333,887 $ 885,234 $ 470,252 $ 253,700 $ 204,421 $ 188,532 $ 77,993 $ 2,414,019 Special mention — — 308 — — 7,950 — 8,258 Classified 726 4,285 3,212 1,765 524 9,945 — 20,457 Total commercial real estate loans $ 334,613 $ 889,519 $ 473,772 $ 255,465 $ 204,945 $ 206,427 $ 77,993 $ 2,442,734 Year-to-date gross charge-offs $ — $ — $ — $ — $ — $ 42 $ — $ 42 Construction/land/land development: Pass $ 259,502 $ 461,373 $ 214,526 $ 21,309 $ 7,221 $ 25,460 $ 42,700 $ 1,032,091 Special mention 746 10,462 19,811 — — — — 31,019 Classified 191 3,132 41 240 662 560 2,289 7,115 Total construction/land/land development loans $ 260,439 $ 474,967 $ 234,378 $ 21,549 $ 7,883 $ 26,020 $ 44,989 $ 1,070,225 Year-to-date gross charge-offs $ — $ — $ — $ — $ — $ — $ — $ — Residential real estate: Pass $ 332,874 $ 549,504 $ 289,289 $ 237,813 $ 79,499 $ 142,265 $ 91,972 $ 1,723,216 Special mention 250 — — 141 — — — 391 Classified 689 1,985 1,439 407 1,367 4,949 492 11,328 Total residential real estate loans $ 333,813 $ 551,489 $ 290,728 $ 238,361 $ 80,866 $ 147,214 $ 92,464 $ 1,734,935 Year-to-date gross charge-offs $ — $ — $ — $ 5 $ — $ 22 $ — $ 27 Commercial and industrial: Pass $ 399,485 $ 272,152 $ 160,636 $ 36,995 $ 57,562 $ 48,523 $ 1,035,021 $ 2,010,374 Special mention 498 6,383 — — — — 650 7,531 Classified 3,583 1,676 12,908 371 470 222 22,325 41,555 Total commercial and industrial loans $ 403,566 $ 280,211 $ 173,544 $ 37,366 $ 58,032 $ 48,745 $ 1,057,996 $ 2,059,460 Year-to-date gross charge-offs $ 203 $ 328 $ 233 $ 141 $ 539 $ 679 $ 9,710 $ 11,833 Mortgage Warehouse Lines of Credit: Pass $ — $ — $ — $ — $ — $ — $ 329,966 $ 329,966 Year-to-date gross charge-offs $ — $ — $ — $ — $ — $ — $ — $ — Consumer: Pass $ 11,053 $ 3,567 $ 1,040 $ 399 $ 470 $ 17 $ 6,988 $ 23,534 Classified 35 42 10 — 2 — 1 90 Total consumer loans $ 11,088 $ 3,609 $ 1,050 $ 399 $ 472 $ 17 $ 6,989 $ 23,624 Year-to-date gross charge-offs $ 3 $ 102 $ 7 $ — $ — $ 2 $ 33 $ 147 The following table reflects recorded investments in loans by credit quality indicator and origination year at December 31, 2022, and gross charge-offs for the year ended December 31, 2022, excluding loans held for sale. Loans acquired are shown in the table by origination year, not merger date. The Company had an immaterial amount of revolving loans converted to term loans at December 31, 2022. Term Loans Amortized Cost Basis by Origination Year (Dollars in thousands) 2022 2021 2020 2019 2018 Prior Revolving Loans Amortized Cost Basis Total Commercial real estate: Pass $ 885,244 $ 502,287 $ 283,368 $ 230,040 $ 168,079 $ 131,411 $ 69,952 $ 2,270,381 Special mention — — — — 8,174 1,359 1,558 11,091 Classified 930 1,795 1,551 4,014 2,965 11,901 50 23,206 Total commercial real estate loans $ 886,174 $ 504,082 $ 284,919 $ 234,054 $ 179,218 $ 144,671 $ 71,560 $ 2,304,678 Year-to-date gross charge-offs $ — $ — $ — $ — $ — $ 166 $ — $ 166 Construction/land/land development: Pass $ 445,943 $ 320,951 $ 58,880 $ 27,381 $ 27,753 $ 5,253 $ 48,436 $ 934,597 Special mention 6,217 — — — — — — 6,217 Classified 180 100 286 38 160 1,708 2,339 4,811 Total construction/land/land development loans $ 452,340 $ 321,051 $ 59,166 $ 27,419 $ 27,913 $ 6,961 $ 50,775 $ 945,625 Year-to-date gross charge-offs $ — $ — $ — $ — $ — $ — $ — $ — Residential real estate: Pass $ 535,739 $ 308,070 $ 261,293 $ 107,530 $ 48,652 $ 123,052 $ 80,375 $ 1,464,711 Special mention — — 390 — — — — 390 Classified 2,227 2,764 90 1,494 1,064 4,653 145 12,437 Total residential real estate loans $ 537,966 $ 310,834 $ 261,773 $ 109,024 $ 49,716 $ 127,705 $ 80,520 $ 1,477,538 Year-to-date gross charge-offs $ — $ — $ — $ — $ — $ 91 $ — $ 91 Commercial and industrial: Pass $ 454,813 $ 239,411 $ 82,168 $ 75,043 $ 40,534 $ 29,745 $ 1,083,221 $ 2,004,935 Special mention 8,683 2,563 — — 187 — 1,620 13,053 Classified 3,641 11,455 188 1,978 1,224 3 14,684 33,173 Total commercial and industrial loans $ 467,137 $ 253,429 $ 82,356 $ 77,021 $ 41,945 $ 29,748 $ 1,099,525 $ 2,051,161 Year-to-date gross charge-offs $ 28 $ 726 $ 48 $ 869 $ 337 $ 1,103 $ 5,348 $ 8,459 Term Loans Amortized Cost Basis by Origination Year (Dollars in thousands) 2022 2021 2020 2019 2018 Prior Revolving Loans Amortized Cost Basis Total Mortgage Warehouse Lines of Credit: Pass $ — $ — $ — $ — $ — $ — $ 282,298 $ 282,298 Special mention — — — — — — 2,042 2,042 Classified — — — — — — 527 527 Year-to-date gross charge-offs $ — $ — $ — $ — $ — $ — $ 284,867 $ 284,867 Current period year-to-date gross charge-offs $ — $ — $ — $ — $ — $ — $ — $ — Consumer: Pass $ 9,730 $ 3,822 $ 1,210 $ 784 $ 135 $ 15 $ 10,408 $ 26,104 Classified 22 19 — 6 — — 2 49 Total consumer loans $ 9,752 $ 3,841 $ 1,210 $ 790 $ 135 $ 15 $ 10,410 $ 26,153 Year-to-date gross charge-offs $ 3 $ 27 $ 7 $ 2 $ 1 $ 1 $ 2 $ 43 The following tables present the Company’s loan portfolio aging analysis at the dates indicated: December 31, 2023 (Dollars in thousands) 30-59 Days Past Due 60-89 Days Past Due Loans Past Due 90 Days or More Total Past Due Current Loans Total Loans Receivable Accruing Loans 90 or More Days Past Due Loans secured by real estate: Commercial real estate $ 2,264 $ — $ — $ 2,264 $ 2,440,470 $ 2,442,734 $ — Construction/land/land development 834 27 13 874 1,069,351 1,070,225 — Residential real estate 8,055 1,326 5,960 15,341 1,719,594 1,734,935 — Total real estate 11,153 1,353 5,973 18,479 5,229,415 5,247,894 — Commercial and industrial 1,221 713 5,417 7,351 2,052,109 2,059,460 — Mortgage warehouse lines of credit — — — — 329,966 329,966 — Consumer 200 10 3 213 23,411 23,624 — Total LHFI $ 12,574 $ 2,076 $ 11,393 $ 26,043 $ 7,634,901 $ 7,660,944 $ — December 31, 2022 (Dollars in thousands) 30-59 Days Past Due 60-89 Days Past Due Loans Past Due 90 Days or More Total Past Due Current Loans Total Loans Receivable Accruing Loans 90 or More Days Past Due Loans secured by real estate: Commercial real estate $ 31 $ — $ 104 $ 135 $ 2,304,543 $ 2,304,678 $ — Construction/land/land development 854 — 17 871 944,754 945,625 — Residential real estate 1,814 891 450 3,155 1,474,383 1,477,538 — Total real estate 2,699 891 571 4,161 4,723,680 4,727,841 — Commercial and industrial 3,878 1,972 544 6,394 2,044,767 2,051,161 — Mortgage warehouse lines of credit — — — — 284,867 284,867 — Consumer 350 16 11 377 25,776 26,153 — Total LHFI $ 6,927 $ 2,879 $ 1,126 $ 10,932 $ 7,079,090 $ 7,090,022 $ — The following tables detail activity in the ALCL by portfolio segment. Accrued interest of $35.1 million and $27.1 million was not included in the book value for the purposes of calculating the allowance at December 31, 2023 and 2022, respectively. Allocation of a portion of the allowance to one category of loans does not preclude its availability to absorb losses in other categories. Year Ended December 31, 2023 Commercial Real Estate Construction/ Land/ Land Development Residential Real Estate Commercial and Industrial Mortgage Warehouse Lines of Credit Consumer Total (Dollars in thousands) Beginning balance $ 19,772 $ 7,776 $ 8,230 $ 50,148 $ 379 $ 856 $ 87,161 Charge-offs 42 — 27 11,833 — 147 12,049 Recoveries 140 3 17 4,068 — 14 4,242 Provision (1) (245) 2,211 2,399 12,947 150 52 17,514 Ending balance $ 19,625 $ 9,990 $ 10,619 $ 55,330 $ 529 $ 775 $ 96,868 Average balance $ 2,404,530 $ 1,015,178 $ 1,629,589 $ 2,054,081 $ 314,079 $ 24,627 $ 7,442,084 Net charge-offs to loan average balance (annualized) — % — % — % 0.38 % — % 0.54 % 0.10 % _________________________ (1) The $16.8 million provision for credit losses on the consolidated statement of income includes a $17.5 million provision for loan losses, a $75,000 provision for off-balance sheet commitments and an $836,000 net benefit provision for credit losses on held to maturity securities for the year ended December 31, 2023. Year Ended December 31, 2022 Commercial Real Estate Construction/ Land/ Land Development Residential Real Estate Commercial and Industrial Mortgage Warehouse Lines of Credit Consumer Total (Dollars in thousands) Beginning balance $ 13,425 $ 4,011 $ 6,116 $ 40,146 $ 340 $ 548 $ 64,586 Allowance for loan credit losses - BTH merger (1) 1 — — 5,525 — 1 5,527 Charge-offs 166 — 91 8,459 — 43 8,759 Recoveries 40 211 102 3,825 — 16 4,194 Provision (2) 6,472 3,554 2,103 9,111 39 334 21,613 Ending balance $ 19,772 $ 7,776 $ 8,230 $ 50,148 $ 379 $ 856 $ 87,161 Average balance $ 1,951,246 $ 708,758 $ 1,143,190 $ 1,675,719 $ 420,639 $ 20,913 $ 5,920,465 Net charge-offs to loan average balance (annualized) 0.01 % (0.03) % — % 0.28 % — % 0.13 % 0.08 % _________________________ (1) Excluded from the allowance is $10.8 million in PCD loans that were acquired in the merger with BTH that were added to the allowance and immediately written off. (2) The $24.7 million provision for credit losses on the consolidated statements of income includes a $21.6 million provision for loan losses, a $2.3 million provision for off-balance sheet commitments and a $732,000 provision for held to maturity securities credit losses for the year ended December 31, 2022. Year Ended December 31, 2021 Commercial Real Estate Construction/ Land/ Land Development Residential Real Estate Commercial and Industrial Mortgage Warehouse Lines of Credit Consumer Total (Dollars in thousands) Beginning Balance $ 15,430 $ 8,191 $ 9,418 $ 51,857 $ 856 $ 918 $ 86,670 Charge-offs 170 — 78 11,923 — 63 12,234 Recoveries 65 — 117 717 — 49 948 Provision (1) (1,900) (4,180) (3,341) (505) (516) (356) (10,798) Ending Balance $ 13,425 $ 4,011 $ 6,116 $ 40,146 $ 340 $ 548 $ 64,586 Average Balance $ 1,501,890 $ 528,618 $ 916,039 $ 1,627,077 $ 753,588 $ 16,764 $ 5,343,976 Net Charge-offs to Loan Average Balance 0.01 % — % — % 0.69 % — % 0.08 % 0.21 % _________________________ (1) The $10.8 million net benefit provision for credit losses on the consolidated statement of income includes a $10.8 million net benefit provision for loan losses, a $68,000 net benefit provision for off-balance sheet commitments and a $101,000 provision for held to maturity securities credit losses for the year ended December 31, 2021. Provision expense for loan credit losses declined $4.1 million to $17.5 million for the year ended December 31, 2023, compared to $21.6 million for the year ended December 31, 2022. The higher provision expense for loan credit losses during the year ended December 31, 2022, was primarily due to the Day 1 CECL loan provision of $14.9 million for loan credit losses on non-PCD loans associated with the BTH merger which occurred on August 1, 2022. The Company’s credit quality profile in relation to the ALCL drove an increase of $5.3 million in the collectively evaluated portion of the reserve at December 31, 2023, when compared to December 31, 2022, primarily due to qualitative factor changes across the Company’s risk pools. The individually evaluated portion of the reserve increased $4.4 million at December 31, 2023, when compared to December 31, 2022. The following table presents the amortized cost basis of collateral dependent loans, which are individually evaluated to determine expected credit losses, and the related ALCL allocated to these loans. December 31, 2023 (Dollars in thousands) Commercial Real Estate Construction/ Land/ Land Development Residential Real Estate Commercial and Industrial Mortgage Warehouse Lines of Credit Consumer Total Real Estate $ 605 $ — $ 4,029 $ — $ — $ — $ 4,634 Equipment — — — 119 — — 119 Other — — — 258 — — 258 Total $ 605 $ — $ 4,029 $ 377 $ — $ — $ 5,011 ALCL Allocation $ — $ — $ — $ — $ — $ — $ — December 31, 2022 (Dollars in thousands) Commercial Real Estate Construction/ Land/ Land Development Residential Real Estate Commercial and Industrial Mortgage Warehouse Lines of Credit Consumer Total Real Estate $ 273 $ 97 $ 6,731 $ — $ — $ — $ 7,101 Accounts Receivable — — — 831 — — 831 Equipment — — — 285 — — 285 Total $ 273 $ 97 $ 6,731 $ 1,116 $ — $ — $ 8,217 ALCL Allocation $ — $ — $ — $ 738 $ — $ — $ 738 Collateral-dependent loans consist primarily of residential real estate, commercial real estate and commercial and industrial loans. These loans are individually evaluated when foreclosure is probable or when the repayment of the loan is expected to be provided substantially through the operation or sale of the underlying collateral. In the case of commercial and industrial loans secured by equipment, the fair value of the collateral is estimated by third-party valuation experts. Loan balances are charged down to the underlying collateral value when they are deemed uncollectible. Note that the Company did not elect to use the collateral maintenance agreement practical expedient available under the current expected credit loss (“CECL”) guidance. Nonaccrual LHFI was as follows: Nonaccrual With No Total Nonaccrual (Dollars in thousands) Loans secured by real estate: December 31, 2023 December 31, 2022 December 31, 2023 December 31, 2022 Commercial real estate $ 746 $ 435 $ 786 $ 526 Construction/land/land development 96 59 305 270 Residential real estate 5,695 7,023 13,037 7,712 Total real estate 6,537 7,517 14,128 8,508 Commercial and industrial 4,706 527 15,897 1,383 Mortgage warehouse lines of credit — — — — Consumer — — 90 49 Total nonaccrual loans $ 11,243 $ 8,044 $ 30,115 $ 9,940 All interest formerly accrued but not received for loans placed on nonaccrual status is reversed from interest income. Subsequent receipts on nonaccrual loans are recorded as a reduction of principal, and interest income is recorded only after principal recovery is reasonably assured. Loans are returned to accrual status when all the principal and interest amounts contractually due are brought current and future payments are reasonably assured. At December 31, 2023, and December 31, 2022, the Company had $1.6 million and zero funding commitments for loans in which the terms were modified as a result of the borrowers experiencing financial difficulty, respectively. For the years ended December 31, 2023, 2022 and 2021, gross interest income that would have been recorded had the nonaccruing loans been current in accordance with their original terms, was $1.4 million, $1.3 million, $1.9 million, respectively. No interest income was recorded on these loans while they were considered nonaccrual during the years ended December 31, 2023, 2022, and 2021. The Company elects the fair value option for recording residential mortgage loans held for sale in accordance with U.S. GAAP. The Company transferred $7.1 million of nonperforming mortgage loans from the held for sale portfolio to the held for investment portfolio during the year ended December 31, 2023. As a result, the company had zero nonaccrual mortgage loans held for sale that were recorded using the fair value option election at December 31, 2023, compared to $3.9 million at December 31, 2022. The table below summarizes modifications made to borrowers experiencing financial difficulty by loan and modification type during the year ended December 31, 2023. Amortized Cost Basis at December 31, 2023 Term Extension Combination: Other-Than-Insignificant Payment Delay (Dollars in thousands) Amortized Cost % of Loans Amortized Cost % of Loans Amortized Cost % of Loans Loans secured by real estate: Commercial real estate $ 7,845 0.32 % $ — — % $ 428 0.02 % Construction/land/land development 3,979 0.37 — — — — Residential real estate 2,599 0.15 190 0.01 98 0.01 Total real estate 14,423 0.27 190 — 526 0.01 Commercial and industrial 21,093 1.02 1,072 0.05 53 — Total $ 35,516 0.46 $ 1,262 0.02 $ 579 0.01 The following table describes the financial effect of the modification made to borrowers experiencing financial difficulty during the year ended December 31, 2023, respectively. Year Ended December 31, 2023 Interest Rate Reduction Term Extension Other-Than-Insignificant Payment Delay Commercial real estate N/A Added a weighted average 10.7 months to the life of the modified loans Delayed payment of weighted average 6 months Construction/land/land development N/A Added a weighted average 13.0 months to the life of the modified loans N/A Residential real estate Reduced weighted average contractual interest rate from 8.8% to 6.0% Added a weighted average 32.8 months to the life of the modified loans Delayed payment of weighted average 2 months Commercial and industrial Reduced weighted average contractual interest rate from 9.9% to 8.9% Added a weighted average 9.5 months to the life of the modified loans Delayed payment of weighted average 6 months The following table depicts the performance of loans that have been modified Payment Status (Amortized Cost Basis) December 31, 2023 (Dollars in thousands) Current 30-89 Days Past Due 90 Days or More Past Due Loans secured by real estate: Commercial real estate $ 8,272 $ — $ — Construction/land/land development 3,979 — — Residential real estate 2,484 120 282 Total real estate 14,735 120 282 Commercial and industrial 22,219 — — Total LHFI $ 36,954 $ 120 $ 282 The table below provides the details of borrowers that were experiencing financial difficulty that were modified within the last twelve months and defaulted during the year ended December 31, 2023. At Or For The Year Ended December 31, 2023 Term Extension (Dollars in thousands) Amortized Cost Default Amount Residential real estate $ 282 $ 282 Commercial and industrial — 10 Total LHFI $ 282 $ 292 A payment default is defined as a loan that was 90 or more days past due. The Company monitors the performance of modified loans on an ongoing basis. In the event of subsequent default, the ALCL is assessed on the basis of an individual evaluation of each loan. The modifications made during the periods presented did not significantly impact the Company’s determination of the allowance for credit losses. |