Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2022 | Aug. 10, 2022 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Jun. 30, 2022 | |
Entity Registrant Name | VIRGINIA NATIONAL BANKSHARES CORP | |
Entity Central Index Key | 0001572334 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | Q2 | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Common Stock, Shares Outstanding | 5,326,271 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity File Number | 001-40305 | |
Entity Incorporation, State or Country Code | VA | |
Entity Tax Identification Number | 46-2331578 | |
Entity Address, Address Line One | 404 People Place | |
Entity Address, City or Town | Charlottesville | |
Entity Address, State or Province | VA | |
Entity Address, Postal Zip Code | 22911 | |
City Area Code | 434 | |
Local Phone Number | 817-8621 | |
Entity Shell Company | false | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Title of 12(b) Security | Common Stock | |
Trading Symbol | VABK | |
Security Exchange Name | NASDAQ |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 | |
ASSETS | |||
Cash and due from banks | $ 17,631 | $ 20,345 | [1] |
Interest-bearing deposits in other banks | 145,217 | 336,032 | [1] |
Federal funds sold | 52,819 | 152,463 | [1] |
Securities: | |||
Available for sale, at fair value | 461,830 | 303,817 | [1] |
Restricted securities, at cost | 5,138 | 4,950 | [1] |
Total securities | 466,968 | 308,767 | [1] |
Loans, net of deferred fees and costs | 960,192 | 1,061,211 | [1] |
Allowance for loan losses | (5,503) | (5,984) | [1] |
Loans, net | 954,689 | 1,055,227 | [1] |
Premises and equipment, net | 19,193 | 25,093 | [1] |
Bank owned life insurance | 38,046 | 31,234 | [1] |
Goodwill | 8,140 | 8,140 | [1] |
Other real estate owned, net | 0 | 611 | [1] |
Right of use asset, net | 7,343 | 7,583 | [1] |
Accrued interest receivable and other assets | 27,249 | 18,144 | [1] |
Total assets | 1,744,940 | 1,972,184 | [1] |
Demand deposits: | |||
Noninterest-bearing | 512,889 | 522,281 | [1] |
Interest-bearing | 399,930 | 446,314 | [1] |
Money market and savings deposit accounts | 535,958 | 665,530 | [1] |
Certificates of deposit and other time deposits | 150,121 | 162,045 | [1] |
Total deposits | 1,598,898 | 1,796,170 | [1] |
Junior subordinated debt, net | 3,390 | 3,367 | [1] |
Lease liability | 6,925 | 7,108 | [1] |
Accrued interest payable and other liabilities | 1,511 | 3,552 | [1] |
Total liabilities | 1,610,724 | 1,810,197 | [1] |
Commitments and contingent liabilities | |||
Shareholders' equity: | |||
Preferred stock, $2.50 par value | [1] | ||
Common stock, $2.50 par value | 13,201 | 13,178 | [1] |
Capital surplus | 104,858 | 104,584 | [1] |
Retained earnings | 53,852 | 46,436 | [1] |
Accumulated other comprehensive loss | (37,695) | (2,211) | [1] |
Total shareholders' equity | 134,216 | 161,987 | [1] |
Total liabilities and shareholders' equity | $ 1,744,940 | $ 1,972,184 | [1] |
Common stock, shares outstanding | 5,326,271 | 5,308,335 | [1] |
Common stock, shares authorized | 10,000,000 | 10,000,000 | [1] |
Preferred stock, shares outstanding | 0 | 0 | [1] |
Preferred stock, shares authorized | 2,000,000 | 2,000,000 | [1] |
Core Deposit [Member] | |||
Securities: | |||
Intangible assets, net | $ 7,405 | $ 8,271 | [1] |
Other Intangible Assets [Member] | |||
Securities: | |||
Intangible assets, net | $ 240 | $ 274 | [1] |
[1] Derived from audited Consolidated Financial Statements |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Jun. 30, 2022 | Dec. 31, 2021 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value per share | $ 2.50 | $ 2.50 |
Common stock, par value per share | $ 2.50 | $ 2.50 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Interest and dividend income: | ||||
Loans, including fees | $ 10,610 | $ 13,009 | $ 21,379 | $ 18,947 |
Federal funds sold | 302 | 21 | 363 | 33 |
Other interest-bearing deposits | 219 | 355 | 39 | |
Investment securities: | ||||
Taxable | 1,662 | 757 | 2,674 | 1,264 |
Tax exempt | 308 | 273 | 612 | 449 |
Dividends | 64 | 32 | 126 | 66 |
Total interest and dividend income | 13,165 | 14,131 | 25,509 | 20,798 |
Interest expense: | ||||
Demand and savings deposits | 498 | 548 | 1,174 | 925 |
Certificates and other time deposits | 157 | 324 | 352 | 604 |
Borrowings | 49 | 108 | 97 | 144 |
Total interest expense | 704 | 980 | 1,623 | 1,673 |
Net interest income | 12,461 | 13,151 | 23,886 | 19,125 |
Provision for (recovery of) loan losses | (217) | (141) | (69) | 210 |
Net interest income after provision for (recovery of) loan losses | 12,678 | 13,292 | 23,955 | 18,915 |
Noninterest income: | ||||
Wealth management fees | 572 | 980 | 1,129 | 1,309 |
Advisory and brokerage income | 210 | 359 | 426 | 550 |
Deposit account fees | 458 | 426 | 923 | 586 |
Debit/credit card and ATM fees | 779 | 599 | 1,486 | 753 |
Bank owned life insurance income | 246 | 199 | 457 | 306 |
Resolution of commercial dispute | 2,400 | |||
Gains on sale of assets | 1,113 | 1,113 | 27 | |
Other | 268 | 357 | 499 | 428 |
Total noninterest income | 3,646 | 2,920 | 8,433 | 3,959 |
Noninterest expense: | ||||
Salaries and employee benefits | 4,086 | 4,741 | 8,817 | 7,143 |
Net occupancy | 1,282 | 1,109 | 2,479 | 1,604 |
Equipment | 254 | 340 | 537 | 456 |
Bank franchise tax | 304 | 429 | 608 | 602 |
Computer software | 357 | 216 | 620 | 383 |
Data processing | 699 | 994 | 1,437 | 1,283 |
FDIC deposit insurance assessment | 125 | 182 | 351 | 245 |
Marketing, advertising and promotion | 259 | 232 | 526 | 369 |
Merger and merger-related expenses | 5,874 | 6,152 | ||
Plastics expense | 92 | 73 | 231 | 115 |
Professional fees | 404 | 510 | 741 | 687 |
Core deposit intangible amortization | 427 | 428 | 866 | 428 |
Other | 1,153 | 865 | 2,324 | 1,307 |
Total noninterest expense | 9,442 | 15,993 | 19,537 | 20,774 |
Income (loss) before income taxes | 6,882 | 219 | 12,851 | 2,100 |
Provision for income taxes | 1,197 | 72 | 2,242 | 448 |
Net income (loss) | $ 5,685 | $ 147 | $ 10,609 | $ 1,652 |
Net income per common share, basic | $ 1.07 | $ 0.03 | $ 1.99 | $ 0.41 |
Net income per common share, diluted | $ 1.06 | $ 0.03 | $ 1.98 | $ 0.41 |
Weighted average common shares outstanding, basic | 5,326,271 | 5,305,277 | 5,319,166 | 4,019,700 |
Weighted average common shares outstanding, diluted | 5,347,008 | 5,320,290 | 5,345,242 | 4,031,301 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income | $ 5,685 | $ 147 | $ 10,609 | $ 1,652 |
Other comprehensive income (loss) | ||||
Unrealized gains (losses) on securities, net of tax of ($4,308) and ($9536) for the three and six months ended June 30, 2022,: and net of tax of $506 and ($394) the three and six months ended June 30, 2021, respectively | (16,214) | 1,903 | (35,879) | (1,484) |
Unrealized gains (losses) on interest rate swaps, net of tax of $42 and $104 for the three and six months ended June 30, 2022; and net of tax of ($30) and ($30) for the three and six months ended June 30, 2021, respectively | 160 | (111) | 395 | (111) |
Total other comprehensive income (loss) | (16,054) | 1,792 | (35,484) | (1,595) |
Total comprehensive income (loss) | $ (10,369) | $ 1,939 | $ (24,875) | $ 57 |
CONSOLIDATED STATEMENTS OF CO_2
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Parenthetical) (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Statement of Comprehensive Income [Abstract] | ||||
Change in unrealized losses on available-for-sale securities, tax | $ (4,308) | $ 506 | $ (9,536) | $ (394) |
Unrealized gains (losses) on interest rate swaps, tax | $ 42 | $ (30) | $ 104 | $ (30) |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (Unaudited) - USD ($) $ in Thousands | Total | Common Stock [Member] | Capital Surplus [Member] | Retained Earnings [Member] | Accumulated Other Comprehensive Income (Loss) [Member] | |
Balance at Dec. 31, 2020 | $ 82,598 | $ 6,722 | $ 32,457 | $ 41,959 | $ 1,460 | |
Exercise of stock options | 15 | 1 | 14 | |||
Stock option expense | 34 | 34 | ||||
Restricted stock grant expense | 61 | 61 | ||||
Vested stock grants | 7 | (7) | ||||
Cash dividends declared | (814) | (814) | ||||
Net income | 1,505 | 1,505 | ||||
Other comprehensive income (loss) | (3,387) | (3,387) | ||||
Balance at Mar. 31, 2021 | 80,012 | 6,730 | 32,559 | 42,650 | (1,927) | |
Balance at Dec. 31, 2020 | 82,598 | 6,722 | 32,457 | 41,959 | 1,460 | |
Net income | 1,652 | |||||
Other comprehensive income (loss) | (1,595) | |||||
Balance at Jun. 30, 2021 | 158,602 | 13,176 | 104,360 | 41,201 | (135) | |
Balance at Mar. 31, 2021 | 80,012 | 6,730 | 32,559 | 42,650 | (1,927) | |
Common stock issued in acquisition of Fauquier Bankshares, Inc. | 78,036 | 6,428 | 71,608 | |||
Exercise of stock options | 15 | 2 | 13 | |||
Stock option expense | 31 | 31 | ||||
Restricted stock grant expense | 165 | 165 | ||||
Vested stock grants | 16 | (16) | ||||
Cash dividends declared | (1,596) | (1,596) | ||||
Net income | 147 | 147 | ||||
Other comprehensive income (loss) | 1,792 | 1,792 | ||||
Balance at Jun. 30, 2021 | 158,602 | 13,176 | 104,360 | 41,201 | (135) | |
Balance at Dec. 31, 2021 | 161,987 | [1] | 13,178 | 104,584 | 46,436 | (2,211) |
Stock option expense | 41 | 41 | ||||
Restricted stock grant expense | 93 | 93 | ||||
Vested stock grants | 12 | (12) | ||||
Cash dividends declared | (1,596) | (1,596) | ||||
Net income | 4,924 | 4,924 | ||||
Other comprehensive income (loss) | (19,430) | (19,430) | ||||
Balance at Mar. 31, 2022 | 146,019 | 13,190 | 104,706 | 49,764 | (21,641) | |
Balance at Dec. 31, 2021 | 161,987 | [1] | 13,178 | 104,584 | 46,436 | (2,211) |
Net income | 10,609 | |||||
Other comprehensive income (loss) | (35,484) | |||||
Balance at Jun. 30, 2022 | 134,216 | 13,201 | 104,858 | 53,852 | (37,695) | |
Balance at Mar. 31, 2022 | 146,019 | 13,190 | 104,706 | 49,764 | (21,641) | |
Stock option expense | 42 | 42 | ||||
Restricted stock grant expense | 121 | 121 | ||||
Vested stock grants | 11 | (11) | ||||
Cash dividends declared | (1,597) | (1,597) | ||||
Net income | 5,685 | 5,685 | ||||
Other comprehensive income (loss) | (16,054) | (16,054) | ||||
Balance at Jun. 30, 2022 | $ 134,216 | $ 13,201 | $ 104,858 | $ 53,852 | $ (37,695) | |
[1] Derived from audited Consolidated Financial Statements |
CONSOLIDATED STATEMENTS OF CH_2
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (Parenthetical) (Unaudited) - $ / shares | 3 Months Ended | |||
Jun. 30, 2022 | Mar. 31, 2022 | Jun. 30, 2021 | Mar. 31, 2021 | |
Statement of Stockholders' Equity [Abstract] | ||||
Cash dividend declared, per share | $ 0.30 | $ 0.30 | $ 0.30 | $ 0.30 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||||
Jun. 30, 2022 | Mar. 31, 2022 | Jun. 30, 2021 | Mar. 31, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | |||||||
Net income | $ 5,685 | $ 4,924 | $ 147 | $ 1,505 | $ 10,609 | $ 1,652 | |
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||
Provision for (recovery of) loan losses | (217) | (141) | (69) | 210 | $ 1,014 | ||
Net accretion of certain acquisition-related adjustments | (1,023) | (804) | |||||
Amortization of intangible assets | 444 | 445 | 900 | 462 | |||
Net amortization and accretion of securities | 539 | 661 | |||||
Net gains on sale of other assets | (1,113) | ||||||
Earnings on bank owned life insurance | (246) | (199) | (457) | (306) | |||
Depreciation and other amortization | 1,921 | 1,406 | |||||
Stock option expense | 83 | 65 | |||||
Stock grant expense, restricted | 121 | 214 | 226 | ||||
Net change in: | |||||||
Accrued interest receivable and other assets | 94 | (1,914) | |||||
Accrued interest payable and other liabilities | (2,032) | 2,808 | |||||
Net cash provided by operating activities | 9,666 | 4,466 | |||||
CASH FLOWS FROM INVESTING ACTIVITIES: | |||||||
Acquisition of Fauquier Bankshares | 153,278 | ||||||
Net (increase) decrease in restricted investments | (188) | 358 | |||||
Purchases of available for sale securities | (216,525) | (15,217) | |||||
Proceeds from maturities, calls and principal payments of available for sale securities | 12,558 | 12,923 | |||||
Net decrease in loans | 101,621 | 46,452 | |||||
Purchase of bank owned life insurance | (6,355) | ||||||
Proceeds from sale of premises and equipment | 6,207 | ||||||
Proceeds from sale of other real estate owned | 610 | ||||||
Purchase of bank premises and equipment | (334) | (818) | |||||
Net cash (used in) provided by investing activities | (102,406) | 196,976 | |||||
CASH FLOWS FROM FINANCING ACTIVITIES: | |||||||
Net (decrease) increase in demand deposits, interest checking accounts, and money market accounts | (185,348) | 78,892 | |||||
Net increase (decrease) in certificates of deposit and other time deposits | (11,892) | 2,167 | |||||
Net decrease in other borrowings | (23) | ||||||
Proceeds from stock options exercised | 30 | ||||||
Cash dividends paid | (3,193) | (3,224) | |||||
Net cash (used in) provided by financing activities | (200,433) | 77,842 | |||||
NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS | (293,173) | 279,284 | |||||
CASH AND CASH EQUIVALENTS: | |||||||
Beginning of period | $ 508,840 | $ 34,695 | 508,840 | 34,695 | 34,695 | ||
End of period | $ 215,667 | $ 313,979 | 215,667 | 313,979 | $ 508,840 | ||
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION | |||||||
Interest | 1,664 | 1,611 | |||||
Taxes | 1,500 | 1,042 | |||||
SUPPLEMENTAL SCHEDULE OF NONCASH INVESTING AND FINANCING ACTIVITIES | |||||||
Unrealized (losses) gains on available for sale securities | (45,415) | (1,878) | |||||
Unrealized gains (losses) on interest rate swaps | 499 | (141) | |||||
Initial right-of-use assets obtained in exchange for new operating lease liabilities | $ 540 | ||||||
Assets acquired in business combination | 910,494 | ||||||
Liabilities assumed in business combination | 840,226 | ||||||
Change in goodwill | $ 7,768 |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 6 Months Ended |
Jun. 30, 2022 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Note 1. Summary of Significant Accounting Policies Principles of Consolidation: The unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information. Accordingly, the unaudited consolidated financial statements do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring items) considered necessary for a fair presentation have been included. The statements should be read in conjunction with the Notes to Consolidated Financial Statements included in the Company’s Form 10-K for the year ended December 31, 2021. Business Combination: On April 1, 2021 , Virginia National Bankshares Corporation completed the merger with Fauquier Bankshares, Inc. with and into the Company for total consideration paid of $ 78.0 million. Additional information about this transaction is presented in Note 2 – Business Combinations. Nature of Operations: The accompanying unaudited consolidated financial statements include the accounts of the Company, and its subsidiaries Virginia National Bank and Masonry Capital Management, LLC, a registered investment advisor. The Bank offers a full range of banking and related financial services to meet the needs of individuals, businesses and charitable organizations, including the fiduciary services of VNB Trust and Estate Services and, in 2021, of TFB Trust and Investment Management. The Bank also offers, through its networking agreements with third parties, investment advisory and other investment services under Sturman Wealth Advisors and, in 2021, TFB Investment Services. All significant intercompany balances and transactions have been eliminated in consolidation. Basis of Presentation: The preparation of financial statements in conformity with GAAP and the reporting guidelines prescribed by regulatory authorities requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Material estimates that are particularly susceptible to significant change in the near term relate to the determination of the ALLL, accounting for business combinations, including loans acquired in the business combination, impairment of loans, goodwill impairment, other-than-temporary impairment of securities, other intangible assets, and fair value measurements. Operating results for the three and six months ended June 30, 2022 are not necessarily indicative of the results that may be expected for the year ending December 31, 2022 . Reclassifications: If needed, certain previously reported amounts have been reclassified to conform to current period presentation. No such reclassifications were significant. Recent Significant Accounting Pronouncements Financial Instruments – Credit Losses In June 2016, the FASB issued ASU 2016-13, “Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments.” The amendments in this ASU, among other things, require the measurement of all expected credit losses for financial assets held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts. Financial institutions and other organizations will now use forward-looking information to better inform their credit loss estimates. Many of the loss estimation techniques applied today will still be permitted, although the inputs to those techniques will change to reflect the full amount of expected credit losses. In addition, the ASU amends the accounting for credit losses on available-for-sale debt securities and purchased financial assets with credit deterioration. The FASB has issued multiple updates to ASU 2016-13 as codified in Topic 326, including ASUs 2019-04, 2019-05, 2019-10, 2019-11, 2020-02, and 2020-03. These ASUs have provided for various minor technical corrections and improvements to the codification as well as other transition matters. Smaller reporting companies, like the Company, who file with the U.S. Securities and Exchange Commission (SEC) and all other entities who do not file with the SEC are required to apply the guidance for fiscal years, and interim periods within those years, beginning after December 15, 2022. The amendments of Topic 326, upon adoption, will be applied on a modified retrospective basis, with the cumulative effect of adopting the new standard being recorded as an adjustment to opening retained earnings in the period of adoption. The Company established a cross-functional steering committee in 2017 to prepare for and implement changes related to Topic 326 and has gathered historical loan loss data for purposes of evaluating appropriate portfolio segmentation and modeling methods under the standard. The Company has performed procedures to validate the historical loan loss data to ensure its suitability and reliability for purposes of developing an estimate of expected credit losses under Topic 326. The Company has also engaged a vendor to assist in modeling expected lifetime losses under Topic 326, and is continuing to develop and refine an approach to estimating the Allowance for Credit Losses (ACL). The adoption of Topic 326 may result in significant changes to the Company’s consolidated financial statements, which may include changes in the level of the ACL that will be considered adequate, a reduction in total equity and regulatory capital of the Bank, differences in the timing of recognizing changes to the ACL and expanded disclosures about the ACL. The Company has not yet determined an estimate of the effect of these changes. The adoption of the standard will also result in significant changes in the Company’s internal control over financial reporting related to the ACL. Effective November 25, 2019, the SEC adopted Staff Accounting Bulletin 119. SAB 119 updated portions of SEC interpretative guidance to align with Topic 326, “Financial Instruments – Credit Losses.” It covers topics including (1) measuring current expected credit losses; (2) development, governance, and documentation of a systematic methodology; (3) documenting the results of a systematic methodology; and (4) validating a systematic methodology. LIBOR and Other Reference Rates In March 2020, the FASB issued ASU 2020-04 “Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting.” These amendments provide temporary optional guidance to ease the potential burden in accounting for reference rate reform. The ASU provides optional expedients and exceptions for applying generally accepted accounting principles to contract modifications and hedging relationships, subject to meeting certain criteria, that reference the LIBOR or another reference rate expected to be discontinued. It is intended to help stakeholders during the global market-wide reference rate transition period. The guidance is effective for all entities as of March 12, 2020 through December 31, 2022. Subsequently, in January 2021, the FASB issued ASU 2021-01 “Reference Rate Reform (Topic 848): Scope.” This ASU clarifies that certain optional expedients and exceptions in Topic 848 for contract modifications and hedge accounting apply to derivatives that are affected by the discounting transition. The ASU also amends the expedients and exceptions in Topic 848 to capture the incremental consequences of the scope clarification and to tailor the existing guidance to derivative instruments affected by the discounting transition. An entity may elect to apply ASU 2021-01 on contract modifications that change the interest rate used for margining, discounting, or contract price alignment retrospectively as of any date from the beginning of the interim period that includes March 12, 2020, or prospectively to new modifications from any date within the interim period that includes or is subsequent to January 7, 2021, up to the date that financial statements are available to be issued. An entity may elect to apply ASU 2021-01 to eligible hedging relationships existing as of the beginning of the interim period that includes March 12, 2020, and to new eligible hedging relationships entered into after the beginning of the interim period that includes March 12, 2020. The Company has identified all loans that are directly or indirectly impacted by LIBOR. The Company is assessing ASU 2020-04 and its impact on the Company’s transition away from LIBOR for its loan and other financial instruments. TDRs and Vintage Disclosures In March 2022, the FASB issued ASU No. 2022-02, “Financial Instruments-Credit Losses (Topic 326), Troubled Debt Restructurings and Vintage Disclosures.” ASU 2022-02 addresses areas identified by the FASB as part of its post-implementation review of the credit losses standard (ASU 2016-13) that introduced the CECL model. The amendments eliminate the accounting guidance for TDRs by creditors that have adopted the CECL model and enhance the disclosure requirements for loan refinancings and restructurings made with borrowers experiencing financial difficulty. In addition, the amendments require a public business entity to disclose current-period gross write-offs for financing receivables and net investment in leases by year of origination in the vintage disclosures. The amendments in this ASU should be applied prospectively, except for the transition method related to the recognition and measurement of TDRs, an entity has the option to apply a modified retrospective transition method, resulting in a cumulative-effect adjustment to retained earnings in the period of adoption. For entities that have adopted ASU 2016-13, ASU 2022-02 is effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. For entities that have not yet adopted ASU 2016-13, the effective dates for ASU 2022-02 are the same as the effective dates in ASU 2016-13. Early adoption is permitted if an entity has adopted ASU 2016-13. An entity may elect to early adopt the amendments about TDRs and related disclosure enhancements separately from the amendments related to vintage disclosures. The Company is currently assessing the impact that ASU 2022-02 will have on its consolidated financial statements. |
Business Combinations
Business Combinations | 6 Months Ended |
Jun. 30, 2022 | |
Business Combinations [Abstract] | |
Business Combinations | Note 2. Business Combinations On April 1, 2021 , the Company completed the merger with Fauquier Bankshares, Inc. with and into the Company, with the Company surviving, pursuant to the terms of the Agreement and Plan of Reorganization, dated September 30, 2020, between the Company and Fauquier. Pursuant to the Merger Agreement, holders of shares of Fauquier common stock received 0.675 shares of the Company’s common stock for each share of Fauquier common stock held immediately prior to the Effective Date of the Merger, plus cash in lieu of fractional shares. In connection with the transaction, the Company issued 2,571,213 shares of its common stock to the shareholders of Fauquier and paid $ 4 thousand in cash in lieu of fractional shares. Each share of the Company’s common stock outstanding immediately prior to the Merger remained outstanding and was unaffected by the Merger. Shortly after the Effective Date of the Merger, The Fauquier Bank, Fauquier’s wholly-owned bank subsidiary, was merged with and into Virginia National Bank, the Company’s wholly-owned bank subsidiary, with Virginia National Bank surviving. The Company accounted for the Merger using the acquisition method of accounting in accordance with ASC 805, Business Combinations. Under the acquisition method of accounting, the assets acquired and liabilities assumed in the Merger and the common stock of the Company issued as consideration were recorded at their respective acquisition date fair values. Determining the fair value of assets and liabilities, particularly related to the loan portfolio, is inherently subjective and involves significant judgment regarding the methods and assumptions used to estimate fair value. Under ASC 805, during the measurement period of up to one year, the acquirer shall adjust the amounts recognized at the acquisition date and may recognize additional assets or liabilities to reflect new information obtained from facts and circumstances that existed as of the acquisition date that, if known, would have affected the measurement of the amounts recognized as of that date. Measurement period adjustments are recognized in the reporting period in which they are determined. The measurement period may not exceed one year from the acquisition date. The following table presents as of April 1, 2021 the total consideration paid by the Company in connection with the Merger, the fair values of the assets acquired and liabilities assumed, and the resulting goodwill (dollars in thousands): As Recorded As Recorded by Fauquier Fair Value by Virginia National Bankshares, Inc. Adjustment Bankshares Assets: Cash and cash equivalents $ 153,282 $ - $ 153,282 Securities available for sale 93,133 - 93,133 Restricted securities 1,619 - 1,619 Loans, net 615,766 ( 13,123 ) 602,643 Premises and equipment 16,276 3,872 20,148 Other real estate owned 1,356 ( 745 ) 611 Bank-owned life insurance 13,677 - 13,677 Right-of-use assets 4,355 1,077 5,432 Core deposit intangible - 9,660 9,660 Other assets 11,298 ( 1,009 ) 10,289 Total assets acquired $ 910,762 $ ( 268 ) $ 910,494 Liabilities: Deposits 817,499 191 817,690 Short-term borrowings 12,582 473 13,055 Junior subordinated debt 4,124 ( 790 ) 3,334 Lease liability 4,440 352 4,792 Other liabilities 1,355 - 1,355 Total liabilities assumed $ 840,000 $ 226 $ 840,226 Net assets acquired $ 70,268 Total consideration paid 78,036 Goodwill $ 7,768 In connection with the Merger, the Company recorded approximately $ 7.8 million of goodwill and $ 9.7 million of other intangible assets related to the core deposits of Fauquier. The goodwill arising from the Merger with Fauquier is not deductible for income taxes. The core deposit intangible asset will be amortized over a period of seven years using the sum of years digits method. The Acquired Loans had aggregate outstanding principal of $ 622.9 million and an estimated fair value of $ 602.6 million. The discount between the outstanding principal balance and fair value of $ 20.3 million represents expected credit losses and adjustments for market interest rates of $ 21.3 million, offset by elimination of net deferred fees/costs of $ 979 thousand. Under the acquisition method (ASC 805), the ALLL recorded in the books of Fauquier in the amount of $ 7.2 million was not carried over into the books of the Company. As of the Effective Date, the fair value of the performing loans was $ 513.8 million, which was 1.7 % less than the book value of the loans. The total fair value discount on performing loans of $ 9.0 million consisted of a credit discount of $ 8.4 million and an other fair value discount of $ 647 thousand. Loans that have evidence of deterioration in credit quality since origination are categorized as purchased credit impaired. As of the Effective Date, the fair value of PCI loans was $ 87.3 million, which was 12.3 % below the book value of the loans. The total fair value mark on PCI loans of $ 12.3 million consisted of a credit discount of $ 11.2 million and an other fair value discount of $ 1.1 million. Information about PCI acquired loans as of April 1, 2021 is as follows (dollars in thousands): April 1, 2021 Contractual principal and interest at acquisition $ 136,476 Nonaccretable difference ( 33,712 ) Expected cash flows at acquisition 102,764 Accretable yield ( 15,499 ) Basis in PCI loans at acquisition, estimated fair value $ 87,265 Fair values of the major categories of assets acquired and liabilities assumed as part of the Merger were determined as follows: Cash and due from banks: The carrying amount of cash and due from banks was used as a reasonable estimate of fair value. Securities available for sale: The estimated fair value of investment securities AFS was based on quoted pricing from a third party portfolio accounting service vendor for the valuation of those securities. Loans: The Acquired Loans were recorded at fair value at the Merger date without carryover of Fauquier's ALLL. The fair value of the Acquired Loans was determined using market participant assumptions in estimating the amount and timing of both principal and interest cash flows expected to be collected on the Acquired Loans and then discounting those cash flows based on a discount rate that would be required by a market participant. In this regard, the Acquired Loans were segregated into pools based on loan type and credit risk. Loan type was determined based on collateral type, loan purpose and loan structure. Credit risk characteristics included risk rating groups (pass rated loans and adversely classified loans), updated loan-to-value ratios and lien position, and past loan performance. For valuation purposes, these pools were further disaggregated by maturity and pricing characteristics (e.g., fixed-rate, adjustable-rate, balloon maturities). Premises and equipment: The land and buildings acquired were recorded at fair value as determined by current appraisals by independent third parties and tax assessments at Effective Date. Other real estate owned : Other real estate owned was recorded at fair value based on an existing purchase contract, less estimated selling costs. (Note that the OREO was sold during the second quarter of 2022.) Bank owned life insurance: The carrying amount of bank owned life insurance was used as a reasonable estimate of fair value. Right of use assets and lease liabilities: Lease liabilities were measured at the present value of the remaining lease payments, as if each acquired lease was a new lease of the Company at the Effective Date. Right-of-use assets were measured at the same amount as the lease liability as adjusted to reflect favorable or unfavorable terms of the lease when compared with market terms. Core deposit intangible: The fair value of the CDI was determined based on a discounted cash flow analysis using a discount rate based on the estimated cost of equity capital for a market participant. To calculate cash flows, deposit account servicing costs (net of deposit fee income) and interest expense on deposits were compared to the cost of alternative funding sources available through the FHLB. The life of the deposit base and projected deposit attrition rates were determined using Fauquier’s historical deposit data. The CDI was estimated at $ 9.7 million or 1.3 % of non-maturity deposits. Deposits: The fair value adjustment of deposits represents a premium over the value of the contractual repayments of fixed-maturity deposits using prevailing market interest rates for similar term certificates of deposit, using a discounted cash flow method. The resulting estimated fair value adjustment of certificates of deposit ranging in maturity from one month to three years is a $ 191 thousand premium and is being amortized into income over a period of thirty-six months . Short-term borrowings: The fair value of borrowings was determined by comparison to current interest rates for similar borrowings. The resulting fair value adjustment to short-term borrowings is a $ 473 thousand premium, which will be amortized into interest expense over the remaining life of the debt on a straight-line basis. (Note that such borrowings were repaid in the third quarter of 2021, and therefore, the premium was fully amortized during the quarter in which they were repaid.) Junior subordinated debt : The fair value of the junior subordinated debt was determined by forecasting the cash flows at the stated coupon rate and discount at a prevailing market rate. The prevailing market rate was based on implied market yields for recently issued debt with similar duration, credit quality, seniority and structure, issued by institutions of similar asset size. The resulting estimated fair value adjustment of junior subordinated debt is a $ 790 thousand discount and is being accreted over the remaining life of the debt on a straight-line basis. The revenue and earnings amounts specific to Fauquier since the Effective Date that are included in the consolidated results for 2021 are not readily determinable. The disclosures of these amounts are impracticable due to the merging of certain processes and systems at the Effective Date. There were no merger and merger-related expenses incurred during the three and six months ended June 30, 2022 and $ 5.9 million and $ 6.2 million incurred during the three and six months ended June 30, 2021 , respectively, primarily consisting of personnel and legal expenses. |
Securities
Securities | 6 Months Ended |
Jun. 30, 2022 | |
Investments, Debt and Equity Securities [Abstract] | |
Securities | Note 3. Securities The amortized cost and fair values of securities available for sale as of June 30, 2022 and December 31, 2021 were as follows (dollars in thousands): June 30, 2022 Gross Gross Amortized Unrealized Unrealized Fair Cost Gains (Losses) Value U.S. Government treasuries $ 162,019 $ - $ ( 1,010 ) $ 161,009 U.S. Government agencies 35,313 - ( 4,781 ) 30,532 Mortgage-backed securities/CMOs 197,121 19 ( 21,177 ) 175,962 Corporate bonds 11,483 4 ( 334 ) 11,154 Municipal bonds 104,027 7 ( 20,861 ) 83,173 Total Securities Available for Sale $ 509,963 $ 30 $ ( 48,163 ) $ 461,830 December 31, 2021 Gross Gross Amortized Unrealized Unrealized Fair Cost Gains (Losses) Value U.S. Government agencies $ 32,424 $ 24 $ ( 867 ) $ 31,581 Mortgage-backed securities/CMOs 172,975 248 ( 2,259 ) 170,964 Municipal bonds 101,136 1,162 ( 1,026 ) 101,272 Total Securities Available for Sale $ 306,535 $ 1,434 $ ( 4,152 ) $ 303,817 As of June 30, 2022 , there were $ 455.5 million, or 278 issues of individual securities, held in an unrealized loss position. These securities have an unrealized loss of $ 48.2 million and consist of 117 mortgage-backed/collateralized mortgage obligations, 124 municipal bonds, 20 agency bonds, 11 treasury bonds and 6 corporate bonds. The following table summarizes all securities with unrealized losses, segregated by length of time in a continuous unrealized loss position at June 30, 2022, and December 31, 2021 (dollars in thousands): Less than 12 Months 12 Months or More Total June 30, 2022 Fair Unrealized Fair Unrealized Fair Unrealized Value Losses Value Losses Value Losses U.S. Government treasuries $ 161,009 $ ( 1,010 ) $ — $ — $ 161,009 $ ( 1,010 ) U.S. Government agencies 11,960 ( 1,207 ) 18,572 ( 3,574 ) 30,532 ( 4,781 ) Mortgage-backed/CMOs 133,182 ( 15,276 ) 39,881 ( 5,901 ) 173,063 ( 21,177 ) Corporate bonds 9,152 ( 334 ) — — 9,152 ( 334 ) Municipal bonds 67,453 ( 16,097 ) 14,277 ( 4,764 ) 81,730 ( 20,861 ) $ 382,756 $ ( 33,924 ) $ 72,730 $ ( 14,239 ) $ 455,486 $ ( 48,163 ) Less than 12 Months 12 Months or More Total December 31, 2021 Fair Unrealized Fair Unrealized Fair Unrealized Value Losses Value Losses Value Losses U.S. Government agencies $ 14,443 $ ( 340 ) $ 15,220 $ ( 527 ) $ 29,663 $ ( 867 ) Mortgage-backed/CMOs 131,876 ( 1,735 ) 15,192 ( 524 ) 147,068 ( 2,259 ) Municipal bonds 40,352 ( 722 ) 10,409 ( 304 ) 50,761 ( 1,026 ) $ 186,671 $ ( 2,797 ) $ 40,821 $ ( 1,355 ) $ 227,492 $ ( 4,152 ) The Company’s securities portfolio is primarily made up of fixed rate instruments, the prices of which move inversely with interest rates. Any unrealized losses are considered by management to be driven by increases in market interest rates over the yields available at the time the underlying securities were purchased. The fair value is expected to recover as the instruments approach their maturity date or repricing date or if market yields for such investments decline. At the end of any accounting period, the portfolio may have both unrealized gains and losses. Management does not believe any of the securities in an unrealized loss position are impaired due to credit quality. Accordingly, as of June 30, 2022, management believes the impairments detailed in the table above are temporary, and no impairment loss has been realized in the Company’s consolidated income statement. An “other-than-temporary impairment” is considered to exist if either of the following conditions are met: it is more likely than not that the Company will be required to sell the security before recovery of its amortized cost basis, or the Company does not expect to recover the security’s entire amortized cost basis (even if the Company does not intend to sell). In the event that a security would suffer impairment for a reason that was “other than temporary,” the Company would be expected to write down the security’s value to its new fair value, and the amount of the write down would be included in earnings as a realized loss. As of June 30, 2022, management has concluded that none of its investment securities have an OTTI based upon the information available. Additionally, management has the ability to hold any security with an unrealized loss until maturity or until such time as the value of the security has recovered from its unrealized loss position. Securities having carrying values of $ 5.4 million at June 30, 2022 were pledged as collateral to secure deposits and facilitate borrowing from the Federal Reserve Bank of Richmond. At December 31, 2021 , securities having carrying values of $ 12.7 million were similarly pledged. For the three and six months ended June 30, 2022 and June 30, 2021 , there were no sales of securities. Restricted securities are securities with limited marketability and consist of stock in the FRB, the Federal Home Loan Bank of Atlanta, CBB Financial Corporation (the holding company for Community Bankers Bank) and an investment in an SBA loan fund. These restricted securities, totaling $ 5.1 million and $ 5.0 million as of June 30, 2022 and December 31, 2021, are carried at cost. The amortized cost and fair value of AFS debt securities at June 30, 2022 are presented below based upon contractual maturities, by major investment categories (dollars in thousands). Expected maturities may differ from contractual maturities because issuers have the right to call or prepay obligations. Amortized Cost Fair Value U.S. Government treasuries One year or less $ 69,543 $ 69,071 After one year to five years 92,476 91,938 $ 162,019 $ 161,009 U.S. Government agencies After one year to five years $ 649 $ 584 After five years to ten years 28,664 25,088 Ten years or more 6,000 4,860 $ 35,313 $ 30,532 Mortgage-backed securities/CMOs After one year to five years $ 11,389 $ 10,897 After five years to ten years 3,211 2,971 Ten years or more 182,521 162,094 $ 197,121 $ 175,962 Corporate bonds After one year to five years $ 5,848 $ 5,798 After five years to ten years 5,635 5,356 $ 11,483 $ 11,154 Municipal bonds One year or less $ 502 $ 502 After one year to five years 610 601 After five years to ten years 17,259 16,039 Ten years or more 85,656 66,031 $ 104,027 $ 83,173 Total Debt Securities Available for Sale $ 509,963 $ 461,830 |
Loans
Loans | 6 Months Ended |
Jun. 30, 2022 | |
Loans and Leases Receivable Disclosure [Abstract] | |
Loans | Note 4. Loans The composition of the loan portfolio by major loan classifications at June 30, 2022 and December 31, 2021 appears below (dollars in thousands). June 30, December 31, 2022 2021 Commercial $ 77,599 $ 96,696 Real estate construction and land 55,140 79,331 1-4 family residential mortgages 329,920 358,148 Commercial mortgages 446,282 473,632 Consumer 51,251 53,404 Total loans 960,192 1,061,211 Less: Allowance for loan losses ( 5,503 ) ( 5,984 ) Net loans $ 954,689 $ 1,055,227 Primarily within the second quarter of 2020 and the first quarter of 2021, the Company and Fauquier, prior to the Merger, assisted nonprofit organizations and local businesses by funding a combined total of $ 207.5 million of SBA PPP loans, which were designed to provide economic relief to small businesses adversely impacted by COVID-19. As of June 30, 2022 , the Company had PPP loans of $ 1.9 million outstanding on its balance sheet, with the remainder having been forgiven by the SBA. The balances in the table above include unamortized premiums and net deferred loan costs and fees. As of June 30, 2022 and December 31, 2021 , unamortized premiums on loans purchased prior to the Merger were $ 811 thousand and $ 1.1 million, respectively. Net deferred loan fees totaled $ 504 thousand and $ 865 thousand as of June 30, 2022 and December 31, 2021 , respectively. The deferred fees include $ 46 thousand in remaining fees collected from the SBA for the PPP loans that are being amortized over the contractual life of the underlying loans, most which are over a 60-month period. As loans are forgiven by the SBA, accounting principles allow for the accelerated recognition of unamortized fees at that time. Loans acquired in business combinations are recorded in the Consolidated Balance Sheets at fair value at the acquisition date under the acquisition method of accounting. The table above includes a net fair value mark of $ 12.3 million on the purchased impaired loans and $ 5.3 million on the purchased performing loans as of June 30, 2022 on the Acquired Loans. See Note 2 – Business Combinations for more information on fair value of loan balances acquired in the Merger. The outstanding principal balance and the carrying amount at June 30, 2022 on these Acquired Loans were as follows (dollars in thousands): June 30, 2022 December 31, 2021 Acquired Loans - Acquired Loans - Purchased Performing Acquired Acquired Loans - Acquired Loans - Purchased Performing Acquired Outstanding principal balance $ 56,178 $ 315,349 $ 371,527 $ 76,608 $ 372,172 $ 448,780 Carrying amount: Commercial $ 702 $ 16,273 $ 16,975 $ 994 $ 28,065 $ 29,059 Real estate construction and land 6,539 9,133 15,672 18,576 14,297 32,873 1-4 family residential mortgages 11,900 173,134 185,034 16,020 194,708 210,728 Commercial mortgages 24,694 109,880 134,574 28,675 126,638 155,313 Consumer 91 1,678 1,769 118 2,224 2,342 Total acquired loans $ 43,926 $ 310,098 $ 354,024 $ 64,383 $ 365,932 $ 430,315 The following table presents a summary of the changes in the accretable yield of loans classified as purchased credit impaired (dollars in thousands): Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Accretable yield, beginning of period $ 12,428 $ — $ 13,742 $ — Additions — 15,499 — 15,499 Accretion ( 761 ) ( 858 ) ( 1,500 ) ( 858 ) Reclassification from (to) nonaccretable difference — — 2,193 — Other changes, net — — ( 2,768 ) — Accretable yield, end of period $ 11,667 $ 14,641 $ 11,667 $ 14,641 Accounting guidance requires certain disclosures about investments in impaired loans, the allowance for loan losses and interest income recognized on impaired loans. A loan is considered impaired when it is probable that the Company will be unable to collect all principal and interest amounts when due according to the contractual terms of the loan agreement. Factors involved in determining impairment include, but are not limited to, expected future cash flows, financial condition of the borrower, and current economic conditions. The following tables reflect the breakdown by class of the Company’s loans classified as impaired loans, excluding Acquired Loans, as of June 30, 2022 and December 31, 2021. These loans are reported at their recorded investment, which is the carrying amount of the loan as reflected on the Company’s balance sheet, net of charge-offs and other amounts applied to reduce the net book balance. Average recorded investment in impaired loans is computed using an average of month-end balances for these loans for either the six months ended June 30, 2022 or the twelve months ended December 31, 2021. Interest income recognized is for the six months ended June 30, 2022 or the twelve months ended December 31, 2021 (dollars in thousands). June 30, 2022 Recorded Unpaid Associated Average Interest Impaired loans without a valuation allowance: 1-4 family residential mortgages $ 604 $ 626 $ - $ 613 $ 2 Total impaired loans without a valuation allowance 604 626 - 613 2 Impaired loans with a valuation allowance Consumer 835 835 9 840 26 Total impaired loans with a valuation allowance 835 835 9 840 26 Total impaired loans $ 1,439 $ 1,461 $ 9 $ 1,453 $ 28 December 31, 2021 Recorded Unpaid Associated Average Interest Impaired loans without a valuation allowance: Real estate construction and land $ - $ 37 $ - $ 2 $ - 1-4 family residential mortgages 594 600 - 269 24 Total impaired loans without a valuation allowance 594 637 - 271 24 Impaired loans with a valuation allowance Consumer 935 935 6 974 54 Total impaired loans with a valuation allowance 935 935 6 974 54 Total impaired loans $ 1,529 $ 1,572 $ 6 $ 1,245 $ 78 Included in the impaired loans are non-accrual loans. Generally, a loan is placed on non-accrual when it is specifically determined to be impaired or when principal or interest is delinquent for 90 days or more. Any unpaid interest previously accrued on those loans is reversed from income. Interest income generally is not recognized on specific impaired loans unless the likelihood of further loss is remote. Interest payments received on such loans are applied as a reduction of the loan principal balance. Interest income on other non-accrual loans is recognized only to the extent of interest payments received. The recorded investment in non-accrual loans is shown below by class (dollars in thousands): June 30, 2022 December 31, 2021 1-4 family residential mortgages $ 511 $ 495 Total non-accrual loans $ 511 $ 495 Additionally, TDRs are considered impaired loans. TDRs occur when the Company agrees to modify the original terms of a loan by granting a concession that it would not otherwise consider due to the deterioration in the financial condition of the borrower. These concessions are done in an attempt to improve the paying capacity of the borrower, and in some cases to avoid foreclosure, and are made with the intent to restore the loan to a performing status once sufficient payment history can be demonstrated. These concessions could include reductions in the interest rate, payment extensions, forgiveness of principal, forbearance, or other actions. In accordance with regulatory guidance, the Company approved for certain customers who have been adversely affected by COVID-19 to defer principal-only, or principal and interest. Such short-term modifications, which were made on a good faith basis in response to COVID-19 to borrowers who were current prior to any relief, are not to be considered TDRs. COVID-19 related loan deferrals declined to zero as of June 30, 2022 , from $ 1.2 million as of December 31, 2021 and $ 2.0 million as of June 30, 2021. Based on regulatory guidance on student lending, the Company has classified 56 of its student loans purchased (“Purchased Student Loans”), as TDRs for a total of $ 835 thousand as of June 30, 2022 . These borrowers that should have been in repayment have requested and been granted payment extensions or reductions exceeding the maximum lifetime allowable payment forbearance of twelve months ( 36 months lifetime allowance for military service), as permitted under the regulatory guidance, and are therefore considered TDRs. Student loan borrowers are allowed in-school deferments, plus an automatic six-month grace period post in-school status, before repayment is scheduled to begin, and these deferments do not count toward the maximum allowable forbearance. Initially, all student loans were fully insured by a surety bond, and the Company did not expect to experience a loss on these loans. Management evaluates these loans individually for impairment and includes any expected loss in the ALLL; interest continues to accrue on these TDRs during any deferment and forbearance periods. The following provides a summary, by class, of TDRs that continue to accrue interest under the terms of the restructuring agreement, which are considered to be performing, and TDRs that have been placed in non-accrual status, which are considered to be nonperforming (dollars in thousands). Troubled debt restructurings June 30, 2022 December 31, 2021 No. of Recorded No. of Recorded Loans Investment Loans Investment Performing TDRs 1-4 family residential mortgages 1 $ 93 1 $ 99 Consumer 56 835 58 935 Total performing TDRs 57 $ 928 59 $ 1,034 Nonperforming TDRs 1-4 family residential mortgages 2 511 1 495 Total nonperforming TDRs 2 $ 511 1 $ 495 Total TDRs 59 $ 1,439 60 $ 1,529 No loans were modified under the terms of a TDR during the three months ended June 30, 2022 or 2021 . A summary of loans shown above that were modified under the terms of a TDR during the six months ended June 30, 2022 and 2021 is shown below by class (dollars in thousands). The Post-Modification Recorded Balance reflects the period end balances, inclusive of any interest capitalized to principal, partial principal paydowns, and principal charge-offs since the modification date. Loans modified as TDRs that were fully paid down, charged-off, or foreclosed upon by period end are not reported. For the six months ended For the six months ended June 30, 2022 June 30, 2021 Number Pre- Post- Number Pre- Post- Consumer -- $ — $ — 6 $ 63 $ 63 1-4 family residential mortgages 1 54 54 -- — — Total loans modified 1 $ 54 $ 54 6 $ 63 $ 63 During the three and six months ended June 30, 2022 , there were no loans modified as a TDR that subsequently defaulted which had been modified as a TDR during the twelve months prior to default. There were five loans modified as a TDR that subsequently defaulted during the year ended December 31, 2021 which had been modified as a TDR during the twelve months prior to default. These student loans had balances totaling $ 56 thousand prior to being charged off. There were no loans secured by 1-4 family residential property that were in the process of foreclosure at June 30, 2022 or December 31, 2021 . |
Allowance for Loan Losses
Allowance for Loan Losses | 6 Months Ended |
Jun. 30, 2022 | |
Allowance For Loan Losses [Abstract] | |
Allowance for Loan Losses | Note 5. Allowance for Loan Losses The ALLL is maintained at a level which, in management’s judgment, is adequate to absorb probable credit losses inherent in the loan portfolio. The amount of the allowance is based on management’s quarterly evaluation of the collectability of the loan portfolio, credit concentrations, historical loss experience, specific impaired loans, and economic conditions. To determine the total ALLL, the Company estimates the reserves needed for each segment of the portfolio, including loans analyzed individually and loans analyzed on a pooled basis. Allowances for impaired loans are generally determined based on collateral values or the present value of estimated cash flows. For purposes of determining the ALLL on the outstanding loans that were not Acquired Loans, the Company has segmented certain loans in the portfolio by product type. Within these segments, the Company has sub-segmented its portfolio by classes within the segments, based on the associated risks within these classes. Note that under the acquisition method of accounting (ASC 805), the ALLL recorded in the books of Fauquier was not carried over into the books of the Company; however the Acquired Loans were subject to net fair value marks. Management utilizes a loss migration model for determining the quantitative risk assigned to unimpaired loans in order to capture historical loss information at the loan level, track loss migration through risk grade deterioration, and increase efficiencies related to performing the calculations. The quantitative risk factor for each loan class primarily utilizes a migration analysis loss method based on loss history for the prior twelve quarters. The migration analysis loss method is used for all loan pools except for the following: • All pools with a risk classification of excellent or good, as noted in the Risk Ratings and Historical Loss Factor Assigned section as follows. • Student loans purchased - The loss rate methodology for student loans is based on the average historical loss rate for each tranche of loans, using a twelve-quarter lookback period. Due to the declining balances in these pools, a balance weighted loss rate weight is used. In addition, qualitative factors are applied. • Commercial and industrial government guaranteed loans and PPP loans - These loans require no reserve as these are 100% guaranteed by either the SBA or the United States Department of Agriculture. • Minute Lender Loans – Commercial and Consumer - Minute Lender loans were acquired in the Merger and were historically assigned a loss rate of 4%, which was a recommendation of the vendor that administers the program. A 4 % loss rate will be utilized until such time that a historical loss rate is available. Under the migration analysis method, average loss rates are calculated at the risk grade and class levels by dividing the twelve-quarter average net charge-off amount by the twelve-quarter average loan balances. Qualitative factors are combined with these quantitative factors to arrive at the overall general allowances. The Company’s internal creditworthiness grading system is based on experiences with similarly graded loans. The Company performs regular credit reviews of the loan portfolio to review the credit quality and adherence to its underwriting standards. Additionally, external reviews of a portion of the credits are conducted annually. Loans that trend upward on the risk ratings scale, toward more positive risk ratings, generally exhibit lower risk factor characteristics. Conversely, loans that migrate toward more negative ratings generally will result in a higher risk factor being applied to those related loan balances. Risk Ratings and Historical Loss Factor Assigned Excellent A 0% historical loss factor is applied, as these loans are secured by cash or fully guaranteed by a U.S. government agency and represent a minimal risk. The Company has never experienced a loss within this category. Good These loans represent a low risk and are secured by marketable collateral within margin. In an abundance of caution, a nominal loss reserve of 0.15 % is applied to these loans. The Company has never experienced a loss within this category. Pass A historical loss factor for loans rated “Pass” is applied to current balances of like-rated loans, pooled by class. Loans with the following risk ratings are pooled by class and considered together as “Pass”: Satisfactory – modest risk loans where the borrower has strong and liquid financial statements and more than adequate cash flow Average – average risk loans where the borrower has reasonable debt service capacity Marginal – acceptable risk loans where the borrower has acceptable financial statements but is leveraged Watch These loans have an acceptable risk but require more attention than normal servicing. A historical loss factor for loans rated “Watch” is applied to current balances of like-rated loans pooled by class. Special Mention These potential problem loans are currently protected but are potentially weak. A historical loss factor for loans rated “Special Mention” is applied to current balances of like-rated loans pooled by class. Substandard These problem loans are inadequately protected by the sound worth and paying capacity of the borrower and/or the value of any collateral pledged. These loans may be considered impaired and evaluated on an individual basis. Otherwise, a historical loss factor for loans rated “Substandard” is applied to current balances of all other “Substandard” loans pooled by class. Doubtful Loans with this rating have significant deterioration in the sound worth and paying capacity of the borrower and/or the value of any collateral pledged, making collection or liquidation of the loan in full highly questionable. These loans would be considered impaired and evaluated on an individual basis. The following represents the loan portfolio designated by the internal risk ratings assigned to each credit as of June 30, 2022 and December 31, 2021 (dollars in thousands). There were no loans rated “Doubtful” as of either period. June 30, 2022 Excellent Good Pass Watch Special Sub- TOTAL Commercial $ 30,684 $ 14,136 $ 30,445 $ 1,291 $ 110 $ 933 $ 77,599 Real estate construction and land - - 47,821 342 1,446 5,531 55,140 1-4 family residential mortgages - - 314,514 6,953 839 7,614 329,920 Commercial mortgages - - 383,299 45,396 7,416 10,171 446,282 Consumer 470 20,417 29,237 960 101 66 51,251 Total Loans $ 31,154 $ 34,553 $ 805,316 $ 54,942 $ 9,912 $ 24,315 $ 960,192 December 31, 2021 Excellent Good Pass Watch Special Sub- TOTAL Commercial $ 45,862 $ 13,920 $ 32,460 $ 732 $ 1,645 $ 2,077 $ 96,696 Real estate construction and land - - 51,098 7,360 2,849 18,024 79,331 1-4 family residential mortgages - 2,030 334,300 5,013 1,520 15,285 358,148 Commercial mortgages - - 382,108 61,563 8,530 21,431 473,632 Consumer 524 18,535 32,821 1,225 179 120 53,404 Total Loans $ 46,386 $ 34,485 $ 832,787 $ 75,893 $ 14,723 $ 56,937 $ 1,061,211 In addition, the adequacy of the Company’s ALLL is evaluated through reference to eight qualitative factors, listed below and ranked in order of importance: 1) Changes in national and local economic conditions, including the condition of various market segments; 2) Changes in the value of underlying collateral; 3) Changes in volume of classified assets, measured as a percentage of capital; 4) Changes in volume of delinquent loans; 5) The existence and effect of any concentrations of credit and changes in the level of such concentrations; 6) Changes in lending policies and procedures, including underwriting standards; 7) Changes in the experience, ability and depth of lending management and staff; and 8) Changes in the level of policy exceptions. It has been the Company’s experience that the first five factors drive losses to a much greater extent than the last three factors; therefore, the first five factors are weighted more heavily. Qualitative factors are not assessed against loans rated “Excellent” or “Good,” as the Company has never experienced a loss within these categories. For each segment and class of loans, management must exercise significant judgment to determine the estimation method that fits the credit risk characteristics of its various segments. Although this evaluation is inherently subjective, qualified management utilizes its significant knowledge and experience related to both the Company’s markets and the history of the Company’s loan losses. Impaired loans are individually evaluated and, if deemed appropriate, a specific allocation is made for these loans. In reviewing the loans classified as impaired loans totaling $ 1.4 million at June 30, 2022 , a specific valuation allowance was recognized after consideration was given for each borrowing as to the fair value of the collateral on the loan or the present value of expected future cash flows from the borrower. The $ 9 thousand in the allowance total shown below as individually evaluated for impairment was attributed to the impaired student loans that required an allowance as of June 30, 2022. A summary of the transactions in the Allowance for Loan Losses by major loan portfolio segment for the six months ended June 30, 2022 and the year ended December 31, 2021 appears below (dollars in thousands): As of and for the period ended June 30, 2022 Commercial Real Estate Real Estate Consumer Total Allowance for Loan Losses: Balance as of beginning of year $ 252 $ 399 $ 4,478 $ 855 $ 5,984 Charge-offs ( 243 ) - - ( 421 ) ( 664 ) Recoveries 136 8 4 104 252 Provision for (recovery of) loan losses 110 ( 51 ) ( 300 ) 172 ( 69 ) Ending Balance $ 255 $ 356 $ 4,182 $ 710 $ 5,503 Ending Balance: Individually evaluated for impairment $ - $ - $ - $ 9 $ 9 Collectively evaluated for impairment 255 356 4,182 701 5,494 Acquired loans - purchased credit - - - - - Loans: Individually evaluated for impairment $ - $ - $ 604 $ 835 $ 1,439 Collectively evaluated for impairment 76,897 48,601 739,004 50,325 914,827 Acquired loans - purchased credit impaired 702 6,539 36,594 91 43,926 Ending Balance $ 77,599 $ 55,140 $ 776,202 $ 51,251 $ 960,192 As of and for the period ended December 31, 2021 Commercial Real Estate Real Estate Consumer Total Allowance for Loan Losses: Balance as of beginning of year $ 209 $ 160 $ 3,897 $ 1,189 $ 5,455 Charge-offs ( 147 ) - - ( 688 ) ( 835 ) Recoveries 191 12 6 141 350 Provision for (recovery of) loan losses ( 1 ) 227 575 213 1,014 Ending Balance $ 252 $ 399 $ 4,478 $ 855 $ 5,984 Ending Balance: Individually evaluated for impairment $ - $ - $ - $ 6 $ 6 Collectively evaluated for impairment 252 399 4,478 849 5,978 Acquired loans - purchased credit - - - - - Loans: Individually evaluated for impairment $ - $ - $ 594 $ 935 $ 1,529 Collectively evaluated for impairment 95,702 60,755 786,491 52,351 995,299 Acquired loans - purchased credit impaired 994 18,576 44,695 118 64,383 Ending Balance $ 96,696 $ 79,331 $ 831,780 $ 53,404 $ 1,061,211 As previously mentioned, one of the major factors that the Company uses in evaluating the adequacy of its ALLL is changes in the volume of delinquent loans. Management monitors payment activity on a regular basis. For all classes of loans, the Company considers the entire balance of the loan to be contractually delinquent if the minimum payment is not received by the due date. Interest and fees continue to accrue on past due loans until they are placed in nonaccrual or charged off. The following tables show the aging of past due loans as of June 30, 2022 and December 31, 2021 (dollars in thousands). Past Due Aging as of 30-59 Days 60-89 Days 90 Days or More Total Past Due PCI Current Total 90 Days Past Due and Still Accruing Commercial $ 762 $ 235 $ 596 $ 1,593 $ 702 $ 75,304 $ 77,599 $ 596 Real estate construction and land - 206 - 206 6,539 48,395 55,140 - 1-4 family residential mortgages 1,350 - - 1,350 11,900 316,670 329,920 - Commercial mortgages - 154 - 154 24,694 421,434 446,282 - Consumer loans 207 102 30 339 91 50,821 51,251 30 Total Loans $ 2,319 $ 697 $ 626 $ 3,642 $ 43,926 $ 912,624 $ 960,192 $ 626 Past Due Aging as of 30-59 Days 60-89 Days 90 Days or More Total Past Due PCI Current Total 90 Days Past Due and Still Accruing Commercial $ 385 $ 355 $ 718 $ 1,458 $ 994 $ 94,244 $ 96,696 $ 718 Real estate construction and land 873 1,283 - 2,156 18,576 58,599 79,331 - 1-4 family residential mortgages 1,508 100 495 2,103 16,020 340,025 358,148 - Commercial mortgages - - - - 28,675 444,957 473,632 - Consumer loans 345 196 83 624 118 52,662 53,404 83 Total Loans $ 3,111 $ 1,934 $ 1,296 $ 6,341 $ 64,383 $ 990,487 $ 1,061,211 $ 801 |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 6 Months Ended |
Jun. 30, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets | Note 6. Goodwill and Other Intangible Assets The carrying amount of goodwill was $ 8.1 million at June 30, 2022 and December 31, 2021. The Company had $ 7.6 million, $ 8.5 million and $ 8.6 million of other intangible assets as of June 30, 2022, December 31, 2021 and June 30, 2021 , respectively. Other intangible assets were recognized in connection with (i) the book of business, including interest in the client relationships of an officer, acquired by VNB Wealth in 2016, now referred to as Sturman Wealth Advisors, and (ii) the core deposits acquired from Fauquier in 2021. The following table summarizes the gross carrying amounts and accumulated amortization of other intangible assets (dollars in thousands): June 30, 2022 December 31, 2021 Gross Carrying Amount Accumulated Amortization Gross Carrying Amount Accumulated Amortization Amortized intangible assets: Core deposit intangible $ 9,660 $ ( 2,255 ) $ 9,660 $ ( 1,389 ) Customer relationships intangible 773 ( 533 ) 773 ( 499 ) Total $ 10,433 $ ( 2,788 ) $ 10,433 $ ( 1,888 ) Amortization expense was $ 444 thousand and $ 445 thousand for the three months ended June 30, 2022 and 2021 , respectively and $ 900 thousand and $ 462 thousand for the six months ended June 30, 2022 and 2021, respectively. Estimated future amortization expense as of June 30, 2022 is as follows (dollars in thousands): Core Customer Deposit Relationships Intangible Intangible For the six months ending December 31, 2022 $ 819 $ 33 For the year ending December 31, 2023 1,493 67 For the year ending December 31, 2024 1,301 67 For the year ending December 31, 2025 1,110 67 For the year ending December 31, 2026 918 6 Thereafter 1,764 - Total $ 7,405 $ 240 |
Leases
Leases | 6 Months Ended |
Jun. 30, 2022 | |
Leases [Abstract] | |
Leases | Note 7. Leases Lease liabilities represent the Company’s obligation to make lease payments and are presented at each reporting date as the net present value of the remaining contractual cash flows. Cash flows are discounted at the Company’s incremental borrowing rate in effect at the commencement date of the lease for a term similar to the length of the lease, including any probable renewal options available. Right-of-use assets represent the Company’s right to use the underlying asset for the lease term and are calculated as the sum of the lease liability and if applicable, prepaid rent, initial direct costs and any incentives received from the lessor. Lease payments for short-term leases are recognized as lease expense on a straight-line basis over the lease term. Payments for leases with terms longer than twelve months are included in the determination of the lease liability. The right-of-use asset and lease liability are included in other assets and other liabilities, respectively, in the Consolidated Balance Sheets. Each of the Company’s long-term lease agreements are classified as operating leases. Certain of these leases offer the option to extend the lease term and the Company has included such extensions in its calculation of the lease liabilities to the extent the options are reasonably assured of being exercised. The lease agreements do not provide for residual value guarantees and have no restrictions or covenants that would impact dividends or require incurring additional financial obligations. The following tables present information about the Company’s leases (dollars in thousands): June 30, 2022 June 30, 2021 Lease liability $ 6,925 $ 7,833 Right -of-use asset $ 7,343 $ 8,371 Weighted average remaining lease term 5.84 years 6.37 years Weighted average discount rate 1.97 % 1.98 % Three Months Ended June 30, Six Months Ended June 30, Lease Expense: 2022 2021 2022 2021 Operating lease expense $ 449 $ 427 $ 894 $ 649 Short-term lease expense 139 32 191 61 Total lease expense $ 588 $ 459 $ 1,085 $ 710 Cash paid for amounts included in $ 418 $ 389 $ 832 $ 608 A maturity analysis of operating lease liabilities and reconciliation of the undiscounted cash flows to the total of operating lease liabilities is as follows (dollars in thousands): Undiscounted Cash Flow June 30, 2022 Six months ending December 31, 2022 $ 817 Twelve months ending December 31, 2023 1,567 Twelve months ending December 31, 2024 1,296 Twelve months ending December 31, 2025 1,091 Twelve months ending December 31, 2026 748 Twelve months ending December 31, 2027 650 Thereafter 1,141 Total undiscounted cash flows $ 7,310 Less: Discount ( 385 ) Lease liability $ 6,925 |
Net Income Per Share
Net Income Per Share | 6 Months Ended |
Jun. 30, 2022 | |
Earnings Per Share [Abstract] | |
Net Income Per Share | Note 8. Net Income Per Share The table below shows the weighted average number of shares used in computing net income per common share and the effect of the weighted average number of shares of potential dilutive common stock for the three and six months ended June 30, 2022 and 2021. Diluted net income per share is computed based on the weighted average number of shares of common stock equivalents outstanding, to the extent dilutive. The Company’s common stock equivalents relate to outstanding common stock options. Unvested restricted stock as of June 30, 2022 and June 30, 2021 is included in the calculation of basic and diluted net income per share (dollars below reported in thousands except per share data). Three Months Ended June 30, 2022 June 30, 2021 Net Weighted Per Net Weighted Per Basic net income per share $ 5,685 5,326,271 $ 1.07 $ 147 5,305,277 $ 0.03 Effect of dilutive stock options - 20,737 ( 0.01 ) - 15,013 - Diluted net income per share $ 5,685 5,347,008 $ 1.06 $ 147 5,320,290 $ 0.03 Six Months Ended June 30, 2022 June 30, 2021 Net Weighted Per Net Weighted Per Basic net income per share $ 10,609 5,319,166 $ 1.99 $ 1,652 4,019,700 $ 0.41 Effect of dilutive stock options - 26,076 ( 0.01 ) - 11,601 - Diluted net income per share $ 10,609 $ 5,345,242 $ 1.98 $ 1,652 4,031,301 $ 0.41 For the three and six months ended June 30, 2022 , there were 101,901 option shares considered anti-dilutive and excluded from this calculation. For the three and six months ended June 30, 2021 , there were 78,301 option shares considered anti-dilutive and excluded from this calculation. |
Stock Incentive Plans
Stock Incentive Plans | 6 Months Ended |
Jun. 30, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Stock Incentive Plans | Note 9. Stock Incentive Plans At the Annual Shareholders Meeting on June 23, 2022, shareholders approved the Virginia National Bankshares Corporation 2022 Stock Incentive Plan. The 2022 Plan made available up to 150,000 shares of the Company’s common stock to be issued to plan participants. The 2014 Plan made available up to 275,625 shares of the Company’s common stock, as adjusted by prior issued stock dividends, to be issued to plan participants. The 2022 Plan and the 2014 Plan provide for granting of both incentive and nonqualified stock options, as well as restricted stock, unrestricted stock and other stock based awards. No new grants can be issued under the 2005 Stock Incentive Plan as this plan has expired. For the 2022 Plan, the option price for any stock options cannot be less that the fair value of the Company’s stock on the grant date. In addition, 95 % of the common stock authorized for issuance must have a vesting or exercise schedule of at least one year. For the 2014 Plan and the 2005 Plan, the option price of incentive stock options cannot be less than the fair value of the stock at the time an option is granted and nonqualified stock options may be granted at prices established by the Board of Directors, including prices less than the fair value on the date of grant. Outstanding stock options generally expire ten years from the grant date. Stock options generally vest by the fourth or fifth anniversary of the date of the grant. A summary of the shares issued and available under each of the Plans is shown below as of June 30, 2022 . Share data and exercise price range per share have been adjusted to reflect prior issued stock dividends. Although the 2005 Plan has expired and no new grants will be issued under this plan, there were options issued before the plan expired that are still outstanding as shown below. No grants have been issued under the 2022 Plan. 2022 Plan 2014 Plan 2005 Plan Aggregate shares issuable 150,000 275,625 253,575 Options issued, net of forfeited and expired — ( 170,106 ) ( 59,870 ) Unrestricted stock issued — ( 11,635 ) — Restricted stock grants issued, net of forfeited — ( 65,853 ) — Cancelled due to Plan expiration — — ( 193,705 ) Remaining available for grant 150,000 28,031 - Stock grants issued and outstanding: Total vested and unvested shares — 77,488 — Fully vested shares — 31,764 — Option grants issued and outstanding: Total vested and unvested shares — 167,901 1,379 Fully vested shares — 76,148 1,379 Exercise price range $ — $ 23.75 to $ 42.62 $ 13.69 The Company accounts for all of its stock incentive plans under recognition and measurement accounting principles which require that the compensation cost relating to stock-based payment transactions be recognized in the financial statements. Stock-based compensation arrangements include stock options and restricted stock. All stock-based payments to employees are required to be valued at a fair value on the date of grant and expensed based on that fair value over the applicable vesting period. Stock Options Changes in the stock options outstanding related to the Plans are summarized below (dollars in thousands except per share data): June 30, 2022 Number of Options Weighted Average Aggregate Outstanding at January 1, 2022 169,280 $ 33.89 $ 962 Issued — — Exercised — — Expired — — Outstanding at June 30, 2022 169,280 $ 33.89 $ 477 Options exercisable at June 30, 2022 77,527 $ 37.31 $ 144 For the three months ended June 30, 2022 and 2021 , the Company recognized $ 42 thousand and $ 31 thousand, respectively, in compensation expense for stock options. For the six months ended June 30, 2022 and 2021 , the Company recognized $ 83 thousand and $ 65 thousand, respectively, in compensation expense for stock options. As of June 30, 2022 , there was $ 304 thousand in unrecognized compensation expense remaining to be recognized in future reporting periods through 2026 . The fair value of any stock option grant is estimated at the grant date using the Black-Scholes pricing model. There were no stock option grants issued during the three and six months ended June 30, 2022 and 2021. Summary information pertaining to options outstanding at June 30, 2022 is shown below. Share and per share data have been adjusted to reflect the prior stock dividends issued. Options Outstanding Options Exercisable Exercise Price Number of Weighted- Weighted- Number of Weighted- $ 13.69 to $ 20.00 1,379 0.6 Years $ 13.69 1,379 $ 13.69 $ 20.01 to $ 30.00 66,000 8.0 Years 24.64 18,400 25.02 $ 30.01 to $ 40.00 44,420 8.1 Years 36.97 11,772 38.52 $ 40.01 to $ 42.62 57,481 5.9 Years 42.62 45,976 42.62 Total 169,280 7.3 Years $ 33.89 77,527 $ 37.31 Stock Grants Unrestricted stock grant - During the six months ended June 30, 2022 , 100 shares of unrestricted stock were granted to an employee for a total expense of $ 3 thousand. No unrestricted stock grants were awarded during the three months ended June 30, 2022 or during the year ended December 31, 2021. Restricted stock grants – During the six months ended June 30, 2022 , 5,580 and 12,856 restricted shares, were granted to employees and non-employee directors, respectively, vesting over a four-year or five-year period. (Note that all such shares were granted during the first quarter of 2022 with no shares granted during the second quarter of 2022.) During the three and six months ended June 30, 2021 , 5,730 and 19,233 restricted shares, respectively, were granted. For the three and six months ended June 30, 2022 , $ 121 thousand and $ 214 thousand, respectively, was expensed as a result of restricted stock grants. As of June 30, 2022 , there was $ 1.3 million in unrecognized compensation expense for all restricted stock grants remaining to be recognized in future reporting periods through 2026 . Changes in the restricted stock grants outstanding during the six months ended June 30, 2022 are summarized below (dollars in thousands except per share data): June 30, 2022 Number of Weighted Aggregate Nonvested as of January 1, 2022 37,011 $ 28.98 $ 1,165 Issued 18,536 35.62 584 Vested ( 9,223 ) ( 27.38 ) ( 290 ) Forfeited ( 600 ) ( 33.74 ) ( 19 ) Nonvested at June 30, 2022 45,724 $ 31.94 $ 1,440 |
Fair Value Measurements
Fair Value Measurements | 6 Months Ended |
Jun. 30, 2022 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Note 10. Fair Value Measurements Determination of Fair Value The Company follows ASC 820, “Fair Value Measurements and Disclosures,” to record fair value adjustments to certain assets and liabilities and to determine fair value disclosures. This codification clarifies that the fair value of a financial instrument is the price that would be received to sell an asset or paid to transfer a liability (exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date. Fair value is best determined based upon quoted market prices. However, in many instances, there are no quoted market prices for the Company’s various financial instruments. In cases where quoted market prices are not available, fair values are based on estimates using present value or other valuation techniques. Those techniques are significantly affected by the assumptions used, including the discount rate and estimates of future cash flows. Accordingly, the fair value estimates may not be realized in an immediate settlement of the instrument. The fair value guidance provides a consistent definition of fair value, which focuses on exit price in the principal or most advantageous market for the asset or liability in an orderly transaction (that is, not a forced liquidation or distressed sale) between market participants at the measurement date under current market conditions. If there has been a significant decrease in the volume and level of activity for the asset or liability, a change in valuation technique or the use of multiple valuation techniques may be appropriate. In such instances, determining the price at which willing market participants would transact at the measurement date under current market conditions depends on the facts and circumstances and requires the use of significant judgment. The fair value is a reasonable point within the range that is most representative of fair value under current market conditions. Fair Value Hierarchy In accordance with this guidance, the Company groups its financial assets and financial liabilities generally measured at fair value in three levels, based on the markets in which the assets and liabilities are traded and the reliability of the assumptions used to determine fair value: Level 1 – Valuation is based on quoted prices in active markets for identical assets and liabilities. Level 2 – Valuation is based on observable inputs including quoted prices in active markets for similar assets and liabilities, quoted prices for identical or similar assets and liabilities in less active markets, and model-based valuation techniques for which significant assumptions can be derived primarily from or corroborated by observable data in the market. Level 3 – Valuation is based on model-based techniques that use one or more significant inputs or assumptions that are unobservable in the market The following describes the valuation techniques used by the Company to measure certain financial assets and liabilities recorded at fair value on a recurring basis in the consolidated financial statements: Securities available for sale Securities AFS are recorded at fair value on a recurring basis. Fair value measurement is based upon quoted market prices, when available (Level 1). If quoted market prices are not available, fair values are measured utilizing independent valuation techniques of identical or similar securities for which significant assumptions are derived primarily from or corroborated by observable market data. Third party vendors compile prices from various sources and may determine the fair value of identical or similar securities by using pricing models that consider observable market data (Level 2). Interest rate swaps The Company recognizes interest rate swaps at fair value. The Company has contracted with a third-party to provide valuations for interest rate swaps using standard valuation techniques. The Company’s interest rate swaps are classified as Level 2. The following tables present the balances measured at fair value on a recurring basis as of June 30, 2022 and December 31, 2021 (dollars in thousands): Fair Value Measurements at June 30, 2022 Using: Quoted Prices Significant Significant Description Balance (Level 1) (Level 2) (Level 3) Assets: U.S. Government treasuries $ 161,009 $ - $ 161,009 $ - U.S. Government agencies 30,532 - 30,532 - Mortgage-backed securities/CMOs 175,962 - 175,962 - Corporate bonds 11,154 - 11,154 - Municipal bonds 83,173 - 83,173 - Total securities available for sale $ 461,830 $ - $ 461,830 $ - Interest rate swap asset 310 - 310 - Total assets at fair value $ 462,140 $ - $ 462,140 $ - Fair Value Measurements at December 31, 2021 Using: Quoted Prices Significant Significant Description Balance (Level 1) (Level 2) (Level 3) Assets: U.S. Government agencies $ 31,581 $ - $ 31,581 $ - Mortgage-backed securities/CMOs 170,964 - 170,964 - Municipal bonds 101,272 - 101,272 - Total securities available for sale $ 303,817 $ - $ 303,817 $ - Liabilities: Interest rate swap liabilities $ 197 $ - $ 197 $ - Total liabilities at fair value $ 197 $ - $ 197 $ - Certain assets are measured at fair value on a nonrecurring basis in accordance with GAAP. Adjustments to the fair value of these assets usually result from the application of lower-of-cost-or-market accounting or write downs of individual assets. The following describes the valuation techniques used by the Company to measure certain assets recorded at fair value on a nonrecurring basis in the consolidated financial statements: Other Real Estate Owned Other real estate owned is measured at fair value less cost to sell, based on an appraisal conducted by an independent, licensed appraiser outside of the Company. If the collateral value is significantly adjusted due to differences in the comparable properties, or is discounted by the Company because of marketability, then the fair value is considered Level 3. OREO is measured at fair value on a nonrecurring basis. Any initial fair value adjustment is charged against the ALLL. Subsequent fair value adjustments are recorded in the period incurred and included in other noninterest expense on the Consolidated Statements of Income. As of December 31, 2021 , the Company had one OREO property acquired through the Merger which was carried at a fair value of $ 611 thousand. The Company sold this OREO property during the current quarter and therefore had a zero balance in OREO as of June 30, 2022. Impaired Loans Loans are designated as impaired when, in the judgment of management based on current information and events, it is probable that all amounts due according to the contractual terms of the loan agreement will not be collected when due. The measurement of loss associated with impaired loans can be based on either (a) the observable market price of the loan or the fair value of the collateral, or (b) using the present value of expected future cash flows discounted at the loan’s effective interest rate, which is not a fair value measurement. Collateral may be in the form of real estate or business assets including equipment, inventory, and accounts receivable. The vast majority of the collateral is real estate. The value of real estate collateral is determined utilizing an income or market valuation approach based on an appraisal conducted by an independent, licensed appraiser outside of the Company using observable market data (Level 2). However, if the collateral value is significantly adjusted due to differences in the comparable properties, or is discounted by the Company because of marketability, then the fair value is considered Level 3. Impaired loans that are measured based on expected future cash flows discounted at the loan’s effective interest rate rather than the market rate of interest are not recorded at fair value, and are therefore excluded from fair value disclosure requirements. The value of business equipment is based upon an outside appraisal if deemed significant, or the net book value on the applicable business’ financial statements if not considered significant. Likewise, values for inventory and accounts receivables collateral are based on financial statement balances or aging reports (Level 3). Impaired loans allocated to the ALLL are measured at fair value on a nonrecurring basis. Any fair value adjustments are recorded in the period incurred as provision for loan losses on the Consolidated Statements of Income. The Company had impaired loans, excluding PCI loans, of $ 1.4 million as of June 30, 2022 and $ 1.5 million as of December 31, 2021. All impaired loans were measured based on expected future cash flows discounted at the loan’s effective interest rate, or fair value of collateral, as noted above . The following table presents the Company’s assets that were measured at fair value on a nonrecurring basis as of December 31, 2021 . There were no such assets to report as of June 30, 2022. Fair Value Measurements at December 31, 2021 Using: Quoted Prices Significant Significant Description Balance (Level 1) (Level 2) (Level 3) Assets: Other Real Estate Owned $ 611 $ - $ - 61100.0 % For the assets measured at fair value on a nonrecurring basis as of December 31, 2021 , the following table displays quantitative information about Level 3 Fair Value Measurements (dollars in thousands). There were no such assets to report as of June 30, 2022. Description Fair Value Valuation Technique Unobservable Inputs Weighted Average Assets: Other Real Estate Owned $ 611 Market comparables Discount applied to bonafide offer 6.0 % * A discount percentage is applied based on estimated cost to sell. ASC 825, “Financial Instruments,” requires disclosures about fair value of financial instruments for interim periods and excludes certain financial instruments and all non-financial instruments from its disclosure requirements. Accordingly, the aggregate fair value amounts presented may not necessarily represent the underlying fair value of the Company. The Company uses the exit price notion in calculating the fair values of financial instruments not measured at fair value on a recurring basis. The carrying values and estimated fair values of the Company's financial instruments as of June 30, 2022 and December 31, 2021 are as follows (dollars in thousands): Fair Value Measurements at June 30, 2022 Using: Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs Carrying value Level 1 Level 2 Level 3 Fair Value Assets Cash and cash equivalent $ 215,667 $ 215,667 $ - $ - $ 215,667 Available for sale securities 461,830 - 461,830 - 461,830 Loans, net 954,689 - - 929,045 929,045 Bank owned life insurance 38,046 - 38,046 - 38,046 Accrued interest receivable 4,229 - 2,055 2,174 4,229 Interest rate swap asset 310 - 310 - 310 Liabilities Demand deposits and interest-bearing transaction and money market accounts $ 1,448,777 $ - $ 1,448,777 $ - $ 1,448,777 Certificates of deposit 150,121 - 144,556 - 144,556 Junior subordinated debt, net 3,390 - 3,459 - 3,459 Accrued interest payable 134 - 134 - 134 Fair Value Measurements at December 31, 2021 Using: Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs Carrying value Level 1 Level 2 Level 3 Fair Value Assets Cash and cash equivalent $ 508,840 $ 508,840 $ - $ - $ 508,840 Available for sale securities 303,817 - 303,817 - 303,817 Loans, net 1,055,227 - - 1,059,650 1,059,650 Bank owned life insurance 31,234 - 31,234 - 31,234 Other real estate owned, net 611 - - 611 611 Accrued interest receivable 3,778 - 1,252 2,526 3,778 Liabilities Demand deposits and interest-bearing transaction and money market accounts $ 1,634,125 $ - $ 1,634,125 $ - $ 1,634,125 Certificates of deposit 162,045 - 161,850 - 161,850 Junior subordinated debt 3,367 - 3,367 - 3,367 Accrued interest payable 174 - 174 - 174 Interest rate swap liabilities 197 - 197 - 197 The Company assumes interest rate risk (the risk that general interest rate levels will change) as a result of its normal operations. Consequently, the fair values of the Company’s financial instruments will fluctuate when interest rate levels change, and that change may be either favorable or unfavorable to the Company. Management attempts to match maturities of assets and liabilities to the extent believed necessary to minimize interest rate risk; however, borrowers with fixed rate obligations are less likely to prepay in a rising rate environment and more likely to prepay in a falling rate environment. Conversely, depositors who are receiving fixed rates are more likely to withdraw funds before maturity in a rising rate environment and less likely to do so in a falling rate environment. Management monitors rates and maturities of assets and liabilities and attempts to minimize interest rate risk by adjusting terms of new loans and deposits and by investing in securities with terms that mitigate the Company’s overall interest rate risk. |
Other Comprehensive Income (Los
Other Comprehensive Income (Loss) | 6 Months Ended |
Jun. 30, 2022 | |
Other Comprehensive Income (Loss), Tax [Abstract] | |
Other Comprehensive Income | Note 11. Other Comprehensive Income (Loss) A component of the Company’s other comprehensive income (loss), in addition to net income from operations, is the recognition of the unrealized gains and losses on AFS securities, net of income taxes. Reclassifications of realized gains and losses on AFS securities are reported in the income statement as “Gains on sales of securities” with the corresponding income tax effect reflected as a component of income tax expense. There were no sales of securities in the three and six months ended June 30, 2022 and 2021. The following table presents the cumulative balances of the components of accumulated other comprehensive income (loss), net of deferred taxes of ($ 7.9 ) million and ($ 464 ) thousand, as of June 30, 2022 and December 31, 2021, respectively (dollars in thousands). June 30, 2022 December 31, 2021 Accumulated other comprehensive loss on securities $ ( 38,026 ) $ ( 2,164 ) Accumulated other comprehensive income (loss) on interest rate swap 331 ( 47 ) Total accumulated other comprehensive loss $ ( 37,695 ) $ ( 2,211 ) |
Derivatives Instruments and Hed
Derivatives Instruments and Hedging Activities | 6 Months Ended |
Jun. 30, 2022 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivatives Instruments and Hedging Activities | Note 12. Derivative Instruments and Hedging Activities The Company uses derivative financial instruments primarily to manage risks to the Company associated with changing interest rates, and to assist customers with their risk management objectives. The Company designates certain interest rate swaps as hedging instruments in qualifying cash flow hedges. The changes in fair value of these designated hedging instruments is reported as a component of other comprehensive income. Customer accommodation loan swaps are derivative contracts that are not designated in a qualifying hedging relationship. Cash flow hedges . The Company designates interest rate swaps as cash flow hedges when they are used to manage exposure to variability in cash flows on variable rate borrowings such as the Company’s junior subordinated debt. These interest rate swaps are derivative financial instruments that manage the risk of variability in cash flows by exchanging variable-rate interest payments on a notional amount of the Company’s borrowings for fixed-rate interest payments. Interest rate swaps designated as cash flow hedges are expected to be highly effective in offsetting the effect of changes in interest rates on the amount of variable-rate interest payments, and the Company assesses the effectiveness of each hedging relationship quarterly. If the Company determines that a cash flow hedge is no longer highly effective, future changes in the fair value of the hedging instrument would be reported in earnings. As of June 30, 2022 and December 31, 2021, the Company had designated cash flow hedges to manage its exposure to variability in cash flows on certain variable rate borrowings through 2036. Unrealized gains or losses recorded in other comprehensive income (loss) related to cash flow hedges are reclassified into earnings in the same period(s) during which the hedged interest payments affect earnings. When a designated hedging instrument is terminated and the hedged interest payments remain probable of occurring, any remaining unrecognized gain or loss in other comprehensive income is reclassified into earnings in the period(s) during which the forecasted interest payments affect earnings. Amounts reclassified into earnings and interest receivable or payable under designated interest rate swaps are reported in interest expense. The Company does not expect any unrealized losses related to cash flow hedges to be reclassified into earnings in the next twelve months. Cash collateral held at other banks for swaps was $ 570 thousand as of June 30, 2022 and December 31, 2021. Collateral is dependent on the market valuation of the underlying hedges. The follow table summarizes the Company’s derivative instruments as of June 30, 2022 and December 31, 2021 (dollars in thousands): June 30, 2022 Derivatives designated as hedging instruments Notional/ Contract Amount Fair Value Fair Value Balance Sheet Location Expiration Date Interest rate forward swap - cash flow $ 4,000 $ 310 Other Liabilities 6/15/2031 December 31, 2021 Derivatives designated as hedging instruments Notional/ Contract Amount Fair Value Fair Value Balance Sheet Location Expiration Date Interest rate forward swap - cash flow $ 4,000 $ ( 197 ) Other Liabilities 6/15/2031 Interest rate swap - fair value $ 3,940 $ ( 8 ) Other Liabilities 2/12/2022 |
Segment Reporting
Segment Reporting | 6 Months Ended |
Jun. 30, 2022 | |
Segment Reporting [Abstract] | |
Segment Reporting | Note 13. Segment Reporting The Company has four reportable segments. Each reportable segment is a strategic business unit that offers different products and services. They are managed separately, because each segment appeals to different markets and, accordingly, require different technology and marketing strategies. The accounting policies of the segments are the same as those described in the summary of significant accounting policies provided earlier in this report. The four reportable segments are: • Bank - The commercial banking segment involves making loans and generating deposits from individuals, businesses and charitable organizations. Loan fee income, service charges from deposit accounts, and other non-interest-related fees, such as fees for debit cards and ATM usage and fees for treasury management services, generate additional income for the Bank segment. • Sturman Wealth Advisors – Sturman Wealth Advisors, formerly known as VNB Investment Services, offers wealth management and investment advisory services. Revenue for this segment is generated primarily from investment advisory and financial planning fees, with a small and decreasing portion attributable to brokerage commissions. • VNB Trust & Estate Services – VNB Trust & Estate Services offers corporate trustee services, trust and estate administration, IRA administration and custody services. Revenue for this segment is generated from administration, service and custody fees, as well as management fees that are derived from Assets Under Management. Investment management services currently are offered through in-house and third-party managers. • Masonry Capital - Masonry Capital offers investment management services for separately managed accounts and a private investment fund employing a value-based, catalyst-driven investment strategy. Revenue for this segment is generated from management fees that are derived from Assets Under Management and incentive income that is based on the investment returns generated on performance-based Assets Under Management. A management fee for administrative and technology support services provided by the Bank is allocated to the other three lines of business. For both the three months ended June 30, 2022 and 2021 , management fees totaling $ 25 thousand were charged by the Bank and eliminated in consolidated totals. For both the six months ended June 30, 2022 and 2021 , management fees totaling $ 50 thousand were charged by the Bank and eliminated in consolidated totals. Segment information for the three and six months ended June 30, 2022 and 2021 is shown in the following tables (dollars in thousands). Note that asset information is not reported below, as the assets of Sturman Wealth Advisors and VNB Trust & Estate Services are reported at the Bank level; also, assets specifically allocated to the lines of business other than the Bank are insignificant and are no longer provided to the chief operating decision maker. Three months ended June 30, 2022 Bank Sturman Wealth Advisors VNB Trust & Masonry Consolidated Net interest income $ 12,461 $ - $ - $ - $ 12,461 Provision for (recovery of) loan losses ( 217 ) - - - $ ( 217 ) Noninterest income 2,851 210 365 220 $ 3,646 Noninterest expense 8,717 161 376 188 $ 9,442 Income (loss) before income taxes 6,812 49 ( 11 ) 32 6,882 Provision for (benefit from) income 1,181 11 ( 2 ) 7 1,197 Net income (loss) $ 5,631 $ 38 $ ( 9 ) $ 25 $ 5,685 Six months ended June 30, 2022 Bank Sturman Wealth Advisors VNB Trust & Masonry Consolidated Net interest income $ 23,886 $ - $ - $ - $ 23,886 Provision for (recovery of) loan losses ( 69 ) - - - ( 69 ) Noninterest income 4,385 426 3,196 426 8,433 Noninterest expense 17,538 327 1,298 374 19,537 Income before income taxes 10,802 99 1,898 52 12,851 Provision for income taxes 1,811 21 399 11 2,242 Net income $ 8,991 $ 78 $ 1,499 $ 41 $ 10,609 Three months ended June 30, 2021 Bank Sturman Wealth Advisors VNB Trust & Masonry Consolidated Net interest income $ 13,151 $ - $ - $ - $ 13,151 Provision for (recovery of) loan losses ( 141 ) - - - ( 141 ) Noninterest income 2,356 202 203 159 2,920 Noninterest expense 15,416 167 215 195 15,993 Income (loss) before income taxes 232 35 ( 12 ) ( 36 ) 219 Provision for (benefit from) income 75 7 ( 3 ) ( 7 ) 72 Net income (loss) $ 157 $ 28 $ ( 9 ) $ ( 29 ) $ 147 Six months ended June 30, 2021 Bank Sturman Wealth Advisors VNB Trust & Masonry Consolidated Net interest income $ 19,125 $ - $ - $ - $ 19,125 Provision for loan losses 210 - - - 210 Noninterest income 2,870 393 404 292 3,959 Noninterest expense 19,671 327 421 355 20,774 Income (loss) before income taxes 2,114 66 ( 17 ) ( 63 ) 2,100 Provision for (benefit from) income 451 14 ( 4 ) ( 13 ) 448 Net income (loss) $ 1,663 $ 52 $ ( 13 ) $ ( 50 ) $ 1,652 |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2022 | |
Accounting Policies [Abstract] | |
Principles of Consolidation | Principles of Consolidation: The unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information. Accordingly, the unaudited consolidated financial statements do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring items) considered necessary for a fair presentation have been included. The statements should be read in conjunction with the Notes to Consolidated Financial Statements included in the Company’s Form 10-K for the year ended December 31, 2021. |
Business Combination | Business Combination: On April 1, 2021 , Virginia National Bankshares Corporation completed the merger with Fauquier Bankshares, Inc. with and into the Company for total consideration paid of $ 78.0 million. Additional information about this transaction is presented in Note 2 – Business Combinations. |
Nature of Operations | Nature of Operations: The accompanying unaudited consolidated financial statements include the accounts of the Company, and its subsidiaries Virginia National Bank and Masonry Capital Management, LLC, a registered investment advisor. The Bank offers a full range of banking and related financial services to meet the needs of individuals, businesses and charitable organizations, including the fiduciary services of VNB Trust and Estate Services and, in 2021, of TFB Trust and Investment Management. The Bank also offers, through its networking agreements with third parties, investment advisory and other investment services under Sturman Wealth Advisors and, in 2021, TFB Investment Services. All significant intercompany balances and transactions have been eliminated in consolidation. |
Basis of Presentation | Basis of Presentation: The preparation of financial statements in conformity with GAAP and the reporting guidelines prescribed by regulatory authorities requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Material estimates that are particularly susceptible to significant change in the near term relate to the determination of the ALLL, accounting for business combinations, including loans acquired in the business combination, impairment of loans, goodwill impairment, other-than-temporary impairment of securities, other intangible assets, and fair value measurements. Operating results for the three and six months ended June 30, 2022 are not necessarily indicative of the results that may be expected for the year ending December 31, 2022 . |
Reclassifications | Reclassifications: If needed, certain previously reported amounts have been reclassified to conform to current period presentation. No such reclassifications were significant. |
Recent Significant Accounting Pronouncements | Recent Significant Accounting Pronouncements Financial Instruments – Credit Losses In June 2016, the FASB issued ASU 2016-13, “Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments.” The amendments in this ASU, among other things, require the measurement of all expected credit losses for financial assets held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts. Financial institutions and other organizations will now use forward-looking information to better inform their credit loss estimates. Many of the loss estimation techniques applied today will still be permitted, although the inputs to those techniques will change to reflect the full amount of expected credit losses. In addition, the ASU amends the accounting for credit losses on available-for-sale debt securities and purchased financial assets with credit deterioration. The FASB has issued multiple updates to ASU 2016-13 as codified in Topic 326, including ASUs 2019-04, 2019-05, 2019-10, 2019-11, 2020-02, and 2020-03. These ASUs have provided for various minor technical corrections and improvements to the codification as well as other transition matters. Smaller reporting companies, like the Company, who file with the U.S. Securities and Exchange Commission (SEC) and all other entities who do not file with the SEC are required to apply the guidance for fiscal years, and interim periods within those years, beginning after December 15, 2022. The amendments of Topic 326, upon adoption, will be applied on a modified retrospective basis, with the cumulative effect of adopting the new standard being recorded as an adjustment to opening retained earnings in the period of adoption. The Company established a cross-functional steering committee in 2017 to prepare for and implement changes related to Topic 326 and has gathered historical loan loss data for purposes of evaluating appropriate portfolio segmentation and modeling methods under the standard. The Company has performed procedures to validate the historical loan loss data to ensure its suitability and reliability for purposes of developing an estimate of expected credit losses under Topic 326. The Company has also engaged a vendor to assist in modeling expected lifetime losses under Topic 326, and is continuing to develop and refine an approach to estimating the Allowance for Credit Losses (ACL). The adoption of Topic 326 may result in significant changes to the Company’s consolidated financial statements, which may include changes in the level of the ACL that will be considered adequate, a reduction in total equity and regulatory capital of the Bank, differences in the timing of recognizing changes to the ACL and expanded disclosures about the ACL. The Company has not yet determined an estimate of the effect of these changes. The adoption of the standard will also result in significant changes in the Company’s internal control over financial reporting related to the ACL. Effective November 25, 2019, the SEC adopted Staff Accounting Bulletin 119. SAB 119 updated portions of SEC interpretative guidance to align with Topic 326, “Financial Instruments – Credit Losses.” It covers topics including (1) measuring current expected credit losses; (2) development, governance, and documentation of a systematic methodology; (3) documenting the results of a systematic methodology; and (4) validating a systematic methodology. LIBOR and Other Reference Rates In March 2020, the FASB issued ASU 2020-04 “Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting.” These amendments provide temporary optional guidance to ease the potential burden in accounting for reference rate reform. The ASU provides optional expedients and exceptions for applying generally accepted accounting principles to contract modifications and hedging relationships, subject to meeting certain criteria, that reference the LIBOR or another reference rate expected to be discontinued. It is intended to help stakeholders during the global market-wide reference rate transition period. The guidance is effective for all entities as of March 12, 2020 through December 31, 2022. Subsequently, in January 2021, the FASB issued ASU 2021-01 “Reference Rate Reform (Topic 848): Scope.” This ASU clarifies that certain optional expedients and exceptions in Topic 848 for contract modifications and hedge accounting apply to derivatives that are affected by the discounting transition. The ASU also amends the expedients and exceptions in Topic 848 to capture the incremental consequences of the scope clarification and to tailor the existing guidance to derivative instruments affected by the discounting transition. An entity may elect to apply ASU 2021-01 on contract modifications that change the interest rate used for margining, discounting, or contract price alignment retrospectively as of any date from the beginning of the interim period that includes March 12, 2020, or prospectively to new modifications from any date within the interim period that includes or is subsequent to January 7, 2021, up to the date that financial statements are available to be issued. An entity may elect to apply ASU 2021-01 to eligible hedging relationships existing as of the beginning of the interim period that includes March 12, 2020, and to new eligible hedging relationships entered into after the beginning of the interim period that includes March 12, 2020. The Company has identified all loans that are directly or indirectly impacted by LIBOR. The Company is assessing ASU 2020-04 and its impact on the Company’s transition away from LIBOR for its loan and other financial instruments. TDRs and Vintage Disclosures In March 2022, the FASB issued ASU No. 2022-02, “Financial Instruments-Credit Losses (Topic 326), Troubled Debt Restructurings and Vintage Disclosures.” ASU 2022-02 addresses areas identified by the FASB as part of its post-implementation review of the credit losses standard (ASU 2016-13) that introduced the CECL model. The amendments eliminate the accounting guidance for TDRs by creditors that have adopted the CECL model and enhance the disclosure requirements for loan refinancings and restructurings made with borrowers experiencing financial difficulty. In addition, the amendments require a public business entity to disclose current-period gross write-offs for financing receivables and net investment in leases by year of origination in the vintage disclosures. The amendments in this ASU should be applied prospectively, except for the transition method related to the recognition and measurement of TDRs, an entity has the option to apply a modified retrospective transition method, resulting in a cumulative-effect adjustment to retained earnings in the period of adoption. For entities that have adopted ASU 2016-13, ASU 2022-02 is effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. For entities that have not yet adopted ASU 2016-13, the effective dates for ASU 2022-02 are the same as the effective dates in ASU 2016-13. Early adoption is permitted if an entity has adopted ASU 2016-13. An entity may elect to early adopt the amendments about TDRs and related disclosure enhancements separately from the amendments related to vintage disclosures. The Company is currently assessing the impact that ASU 2022-02 will have on its consolidated financial statements. |
Business Combinations (Tables)
Business Combinations (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Business Combinations [Abstract] | |
Summary of Total Consideration Paid in Connection with Merger | The following table presents as of April 1, 2021 the total consideration paid by the Company in connection with the Merger, the fair values of the assets acquired and liabilities assumed, and the resulting goodwill (dollars in thousands): As Recorded As Recorded by Fauquier Fair Value by Virginia National Bankshares, Inc. Adjustment Bankshares Assets: Cash and cash equivalents $ 153,282 $ - $ 153,282 Securities available for sale 93,133 - 93,133 Restricted securities 1,619 - 1,619 Loans, net 615,766 ( 13,123 ) 602,643 Premises and equipment 16,276 3,872 20,148 Other real estate owned 1,356 ( 745 ) 611 Bank-owned life insurance 13,677 - 13,677 Right-of-use assets 4,355 1,077 5,432 Core deposit intangible - 9,660 9,660 Other assets 11,298 ( 1,009 ) 10,289 Total assets acquired $ 910,762 $ ( 268 ) $ 910,494 Liabilities: Deposits 817,499 191 817,690 Short-term borrowings 12,582 473 13,055 Junior subordinated debt 4,124 ( 790 ) 3,334 Lease liability 4,440 352 4,792 Other liabilities 1,355 - 1,355 Total liabilities assumed $ 840,000 $ 226 $ 840,226 Net assets acquired $ 70,268 Total consideration paid 78,036 Goodwill $ 7,768 |
Summary of Information About Purchased Credit Impaired (PCI) Loans | Information about PCI acquired loans as of April 1, 2021 is as follows (dollars in thousands): April 1, 2021 Contractual principal and interest at acquisition $ 136,476 Nonaccretable difference ( 33,712 ) Expected cash flows at acquisition 102,764 Accretable yield ( 15,499 ) Basis in PCI loans at acquisition, estimated fair value $ 87,265 |
Securities (Tables)
Securities (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Investments, Debt and Equity Securities [Abstract] | |
Schedule of Amortized Cost and Fair Values of Securities Available For Sale | The amortized cost and fair values of securities available for sale as of June 30, 2022 and December 31, 2021 were as follows (dollars in thousands): June 30, 2022 Gross Gross Amortized Unrealized Unrealized Fair Cost Gains (Losses) Value U.S. Government treasuries $ 162,019 $ - $ ( 1,010 ) $ 161,009 U.S. Government agencies 35,313 - ( 4,781 ) 30,532 Mortgage-backed securities/CMOs 197,121 19 ( 21,177 ) 175,962 Corporate bonds 11,483 4 ( 334 ) 11,154 Municipal bonds 104,027 7 ( 20,861 ) 83,173 Total Securities Available for Sale $ 509,963 $ 30 $ ( 48,163 ) $ 461,830 December 31, 2021 Gross Gross Amortized Unrealized Unrealized Fair Cost Gains (Losses) Value U.S. Government agencies $ 32,424 $ 24 $ ( 867 ) $ 31,581 Mortgage-backed securities/CMOs 172,975 248 ( 2,259 ) 170,964 Municipal bonds 101,136 1,162 ( 1,026 ) 101,272 Total Securities Available for Sale $ 306,535 $ 1,434 $ ( 4,152 ) $ 303,817 |
Schedule of Unrealized Losses in the Bank's Securities Portfolio | The following table summarizes all securities with unrealized losses, segregated by length of time in a continuous unrealized loss position at June 30, 2022, and December 31, 2021 (dollars in thousands): Less than 12 Months 12 Months or More Total June 30, 2022 Fair Unrealized Fair Unrealized Fair Unrealized Value Losses Value Losses Value Losses U.S. Government treasuries $ 161,009 $ ( 1,010 ) $ — $ — $ 161,009 $ ( 1,010 ) U.S. Government agencies 11,960 ( 1,207 ) 18,572 ( 3,574 ) 30,532 ( 4,781 ) Mortgage-backed/CMOs 133,182 ( 15,276 ) 39,881 ( 5,901 ) 173,063 ( 21,177 ) Corporate bonds 9,152 ( 334 ) — — 9,152 ( 334 ) Municipal bonds 67,453 ( 16,097 ) 14,277 ( 4,764 ) 81,730 ( 20,861 ) $ 382,756 $ ( 33,924 ) $ 72,730 $ ( 14,239 ) $ 455,486 $ ( 48,163 ) Less than 12 Months 12 Months or More Total December 31, 2021 Fair Unrealized Fair Unrealized Fair Unrealized Value Losses Value Losses Value Losses U.S. Government agencies $ 14,443 $ ( 340 ) $ 15,220 $ ( 527 ) $ 29,663 $ ( 867 ) Mortgage-backed/CMOs 131,876 ( 1,735 ) 15,192 ( 524 ) 147,068 ( 2,259 ) Municipal bonds 40,352 ( 722 ) 10,409 ( 304 ) 50,761 ( 1,026 ) $ 186,671 $ ( 2,797 ) $ 40,821 $ ( 1,355 ) $ 227,492 $ ( 4,152 ) |
Schedule of Amortized Cost and Fair Values of Securities Available For Sale Based upon Contractual Maturities and by Major Investment Categories | The amortized cost and fair value of AFS debt securities at June 30, 2022 are presented below based upon contractual maturities, by major investment categories (dollars in thousands). Expected maturities may differ from contractual maturities because issuers have the right to call or prepay obligations. Amortized Cost Fair Value U.S. Government treasuries One year or less $ 69,543 $ 69,071 After one year to five years 92,476 91,938 $ 162,019 $ 161,009 U.S. Government agencies After one year to five years $ 649 $ 584 After five years to ten years 28,664 25,088 Ten years or more 6,000 4,860 $ 35,313 $ 30,532 Mortgage-backed securities/CMOs After one year to five years $ 11,389 $ 10,897 After five years to ten years 3,211 2,971 Ten years or more 182,521 162,094 $ 197,121 $ 175,962 Corporate bonds After one year to five years $ 5,848 $ 5,798 After five years to ten years 5,635 5,356 $ 11,483 $ 11,154 Municipal bonds One year or less $ 502 $ 502 After one year to five years 610 601 After five years to ten years 17,259 16,039 Ten years or more 85,656 66,031 $ 104,027 $ 83,173 Total Debt Securities Available for Sale $ 509,963 $ 461,830 |
Loans (Tables)
Loans (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Loans and Leases Receivable Disclosure [Abstract] | |
Schedule of Composition of Loan Portfolio by Major Loan Classifications | The composition of the loan portfolio by major loan classifications at June 30, 2022 and December 31, 2021 appears below (dollars in thousands). June 30, December 31, 2022 2021 Commercial $ 77,599 $ 96,696 Real estate construction and land 55,140 79,331 1-4 family residential mortgages 329,920 358,148 Commercial mortgages 446,282 473,632 Consumer 51,251 53,404 Total loans 960,192 1,061,211 Less: Allowance for loan losses ( 5,503 ) ( 5,984 ) Net loans $ 954,689 $ 1,055,227 |
Summary of Outstanding Principal Balance and Carrying Amount of Loans Acquired in Business Combination | The outstanding principal balance and the carrying amount at June 30, 2022 on these Acquired Loans were as follows (dollars in thousands): June 30, 2022 December 31, 2021 Acquired Loans - Acquired Loans - Purchased Performing Acquired Acquired Loans - Acquired Loans - Purchased Performing Acquired Outstanding principal balance $ 56,178 $ 315,349 $ 371,527 $ 76,608 $ 372,172 $ 448,780 Carrying amount: Commercial $ 702 $ 16,273 $ 16,975 $ 994 $ 28,065 $ 29,059 Real estate construction and land 6,539 9,133 15,672 18,576 14,297 32,873 1-4 family residential mortgages 11,900 173,134 185,034 16,020 194,708 210,728 Commercial mortgages 24,694 109,880 134,574 28,675 126,638 155,313 Consumer 91 1,678 1,769 118 2,224 2,342 Total acquired loans $ 43,926 $ 310,098 $ 354,024 $ 64,383 $ 365,932 $ 430,315 |
Summary of Changes in Accretable Yield of Loans Classified as Purchased Credit Impaired | The following table presents a summary of the changes in the accretable yield of loans classified as purchased credit impaired (dollars in thousands): Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Accretable yield, beginning of period $ 12,428 $ — $ 13,742 $ — Additions — 15,499 — 15,499 Accretion ( 761 ) ( 858 ) ( 1,500 ) ( 858 ) Reclassification from (to) nonaccretable difference — — 2,193 — Other changes, net — — ( 2,768 ) — Accretable yield, end of period $ 11,667 $ 14,641 $ 11,667 $ 14,641 |
Schedule of Loans Classified as Impaired Loans | The following tables reflect the breakdown by class of the Company’s loans classified as impaired loans, excluding Acquired Loans, as of June 30, 2022 and December 31, 2021. These loans are reported at their recorded investment, which is the carrying amount of the loan as reflected on the Company’s balance sheet, net of charge-offs and other amounts applied to reduce the net book balance. Average recorded investment in impaired loans is computed using an average of month-end balances for these loans for either the six months ended June 30, 2022 or the twelve months ended December 31, 2021. Interest income recognized is for the six months ended June 30, 2022 or the twelve months ended December 31, 2021 (dollars in thousands). June 30, 2022 Recorded Unpaid Associated Average Interest Impaired loans without a valuation allowance: 1-4 family residential mortgages $ 604 $ 626 $ - $ 613 $ 2 Total impaired loans without a valuation allowance 604 626 - 613 2 Impaired loans with a valuation allowance Consumer 835 835 9 840 26 Total impaired loans with a valuation allowance 835 835 9 840 26 Total impaired loans $ 1,439 $ 1,461 $ 9 $ 1,453 $ 28 December 31, 2021 Recorded Unpaid Associated Average Interest Impaired loans without a valuation allowance: Real estate construction and land $ - $ 37 $ - $ 2 $ - 1-4 family residential mortgages 594 600 - 269 24 Total impaired loans without a valuation allowance 594 637 - 271 24 Impaired loans with a valuation allowance Consumer 935 935 6 974 54 Total impaired loans with a valuation allowance 935 935 6 974 54 Total impaired loans $ 1,529 $ 1,572 $ 6 $ 1,245 $ 78 |
Schedule of Impaired Loans Classified as Non-Accruals by Class | The recorded investment in non-accrual loans is shown below by class (dollars in thousands): June 30, 2022 December 31, 2021 1-4 family residential mortgages $ 511 $ 495 Total non-accrual loans $ 511 $ 495 |
Schedule of Loans Modified Under Terms of a TDR | The following provides a summary, by class, of TDRs that continue to accrue interest under the terms of the restructuring agreement, which are considered to be performing, and TDRs that have been placed in non-accrual status, which are considered to be nonperforming (dollars in thousands). Troubled debt restructurings June 30, 2022 December 31, 2021 No. of Recorded No. of Recorded Loans Investment Loans Investment Performing TDRs 1-4 family residential mortgages 1 $ 93 1 $ 99 Consumer 56 835 58 935 Total performing TDRs 57 $ 928 59 $ 1,034 Nonperforming TDRs 1-4 family residential mortgages 2 511 1 495 Total nonperforming TDRs 2 $ 511 1 $ 495 Total TDRs 59 $ 1,439 60 $ 1,529 |
Summary of Modified Loans | A summary of loans shown above that were modified under the terms of a TDR during the six months ended June 30, 2022 and 2021 is shown below by class (dollars in thousands). The Post-Modification Recorded Balance reflects the period end balances, inclusive of any interest capitalized to principal, partial principal paydowns, and principal charge-offs since the modification date. Loans modified as TDRs that were fully paid down, charged-off, or foreclosed upon by period end are not reported. For the six months ended For the six months ended June 30, 2022 June 30, 2021 Number Pre- Post- Number Pre- Post- Consumer -- $ — $ — 6 $ 63 $ 63 1-4 family residential mortgages 1 54 54 -- — — Total loans modified 1 $ 54 $ 54 6 $ 63 $ 63 |
Allowance for Loan Losses (Tabl
Allowance for Loan Losses (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Allowance For Loan Losses [Abstract] | |
Internal Risk Rating Grades | The following represents the loan portfolio designated by the internal risk ratings assigned to each credit as of June 30, 2022 and December 31, 2021 (dollars in thousands). There were no loans rated “Doubtful” as of either period. June 30, 2022 Excellent Good Pass Watch Special Sub- TOTAL Commercial $ 30,684 $ 14,136 $ 30,445 $ 1,291 $ 110 $ 933 $ 77,599 Real estate construction and land - - 47,821 342 1,446 5,531 55,140 1-4 family residential mortgages - - 314,514 6,953 839 7,614 329,920 Commercial mortgages - - 383,299 45,396 7,416 10,171 446,282 Consumer 470 20,417 29,237 960 101 66 51,251 Total Loans $ 31,154 $ 34,553 $ 805,316 $ 54,942 $ 9,912 $ 24,315 $ 960,192 December 31, 2021 Excellent Good Pass Watch Special Sub- TOTAL Commercial $ 45,862 $ 13,920 $ 32,460 $ 732 $ 1,645 $ 2,077 $ 96,696 Real estate construction and land - - 51,098 7,360 2,849 18,024 79,331 1-4 family residential mortgages - 2,030 334,300 5,013 1,520 15,285 358,148 Commercial mortgages - - 382,108 61,563 8,530 21,431 473,632 Consumer 524 18,535 32,821 1,225 179 120 53,404 Total Loans $ 46,386 $ 34,485 $ 832,787 $ 75,893 $ 14,723 $ 56,937 $ 1,061,211 |
Summary of Transactions in Allowance for Loan Losses by Major Loan Portfolio Segment | A summary of the transactions in the Allowance for Loan Losses by major loan portfolio segment for the six months ended June 30, 2022 and the year ended December 31, 2021 appears below (dollars in thousands): As of and for the period ended June 30, 2022 Commercial Real Estate Real Estate Consumer Total Allowance for Loan Losses: Balance as of beginning of year $ 252 $ 399 $ 4,478 $ 855 $ 5,984 Charge-offs ( 243 ) - - ( 421 ) ( 664 ) Recoveries 136 8 4 104 252 Provision for (recovery of) loan losses 110 ( 51 ) ( 300 ) 172 ( 69 ) Ending Balance $ 255 $ 356 $ 4,182 $ 710 $ 5,503 Ending Balance: Individually evaluated for impairment $ - $ - $ - $ 9 $ 9 Collectively evaluated for impairment 255 356 4,182 701 5,494 Acquired loans - purchased credit - - - - - Loans: Individually evaluated for impairment $ - $ - $ 604 $ 835 $ 1,439 Collectively evaluated for impairment 76,897 48,601 739,004 50,325 914,827 Acquired loans - purchased credit impaired 702 6,539 36,594 91 43,926 Ending Balance $ 77,599 $ 55,140 $ 776,202 $ 51,251 $ 960,192 As of and for the period ended December 31, 2021 Commercial Real Estate Real Estate Consumer Total Allowance for Loan Losses: Balance as of beginning of year $ 209 $ 160 $ 3,897 $ 1,189 $ 5,455 Charge-offs ( 147 ) - - ( 688 ) ( 835 ) Recoveries 191 12 6 141 350 Provision for (recovery of) loan losses ( 1 ) 227 575 213 1,014 Ending Balance $ 252 $ 399 $ 4,478 $ 855 $ 5,984 Ending Balance: Individually evaluated for impairment $ - $ - $ - $ 6 $ 6 Collectively evaluated for impairment 252 399 4,478 849 5,978 Acquired loans - purchased credit - - - - - Loans: Individually evaluated for impairment $ - $ - $ 594 $ 935 $ 1,529 Collectively evaluated for impairment 95,702 60,755 786,491 52,351 995,299 Acquired loans - purchased credit impaired 994 18,576 44,695 118 64,383 Ending Balance $ 96,696 $ 79,331 $ 831,780 $ 53,404 $ 1,061,211 |
Schedule of Aging of Past Due Loans | The following tables show the aging of past due loans as of June 30, 2022 and December 31, 2021 (dollars in thousands). Past Due Aging as of 30-59 Days 60-89 Days 90 Days or More Total Past Due PCI Current Total 90 Days Past Due and Still Accruing Commercial $ 762 $ 235 $ 596 $ 1,593 $ 702 $ 75,304 $ 77,599 $ 596 Real estate construction and land - 206 - 206 6,539 48,395 55,140 - 1-4 family residential mortgages 1,350 - - 1,350 11,900 316,670 329,920 - Commercial mortgages - 154 - 154 24,694 421,434 446,282 - Consumer loans 207 102 30 339 91 50,821 51,251 30 Total Loans $ 2,319 $ 697 $ 626 $ 3,642 $ 43,926 $ 912,624 $ 960,192 $ 626 Past Due Aging as of 30-59 Days 60-89 Days 90 Days or More Total Past Due PCI Current Total 90 Days Past Due and Still Accruing Commercial $ 385 $ 355 $ 718 $ 1,458 $ 994 $ 94,244 $ 96,696 $ 718 Real estate construction and land 873 1,283 - 2,156 18,576 58,599 79,331 - 1-4 family residential mortgages 1,508 100 495 2,103 16,020 340,025 358,148 - Commercial mortgages - - - - 28,675 444,957 473,632 - Consumer loans 345 196 83 624 118 52,662 53,404 83 Total Loans $ 3,111 $ 1,934 $ 1,296 $ 6,341 $ 64,383 $ 990,487 $ 1,061,211 $ 801 |
Goodwill and Other Intangible_2
Goodwill and Other Intangible Assets (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Gross Carrying Amounts and Accumulated Amortization of Other Intangible Assets | The following table summarizes the gross carrying amounts and accumulated amortization of other intangible assets (dollars in thousands): June 30, 2022 December 31, 2021 Gross Carrying Amount Accumulated Amortization Gross Carrying Amount Accumulated Amortization Amortized intangible assets: Core deposit intangible $ 9,660 $ ( 2,255 ) $ 9,660 $ ( 1,389 ) Customer relationships intangible 773 ( 533 ) 773 ( 499 ) Total $ 10,433 $ ( 2,788 ) $ 10,433 $ ( 1,888 ) |
Schedule of Estimated Future Amortization Expense | Estimated future amortization expense as of June 30, 2022 is as follows (dollars in thousands): Core Customer Deposit Relationships Intangible Intangible For the six months ending December 31, 2022 $ 819 $ 33 For the year ending December 31, 2023 1,493 67 For the year ending December 31, 2024 1,301 67 For the year ending December 31, 2025 1,110 67 For the year ending December 31, 2026 918 6 Thereafter 1,764 - Total $ 7,405 $ 240 |
Leases (Tables)
Leases (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Leases [Abstract] | |
Schedule of Lease Liability, Right-of-use Asset, Weighted Average Remaining Lease Term and Discount Rate | The following tables present information about the Company’s leases (dollars in thousands): June 30, 2022 June 30, 2021 Lease liability $ 6,925 $ 7,833 Right -of-use asset $ 7,343 $ 8,371 Weighted average remaining lease term 5.84 years 6.37 years Weighted average discount rate 1.97 % 1.98 % |
Schedule of Operating Lease Expense | Three Months Ended June 30, Six Months Ended June 30, Lease Expense: 2022 2021 2022 2021 Operating lease expense $ 449 $ 427 $ 894 $ 649 Short-term lease expense 139 32 191 61 Total lease expense $ 588 $ 459 $ 1,085 $ 710 Cash paid for amounts included in $ 418 $ 389 $ 832 $ 608 |
Schedule of Operating Lease Liabilities and Reconciliation of Undiscounted Cash Flows | A maturity analysis of operating lease liabilities and reconciliation of the undiscounted cash flows to the total of operating lease liabilities is as follows (dollars in thousands): Undiscounted Cash Flow June 30, 2022 Six months ending December 31, 2022 $ 817 Twelve months ending December 31, 2023 1,567 Twelve months ending December 31, 2024 1,296 Twelve months ending December 31, 2025 1,091 Twelve months ending December 31, 2026 748 Twelve months ending December 31, 2027 650 Thereafter 1,141 Total undiscounted cash flows $ 7,310 Less: Discount ( 385 ) Lease liability $ 6,925 |
Net Income Per Share (Tables)
Net Income Per Share (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Earnings Per Share [Abstract] | |
Schedule of weighted average number of shares used in computing earnings per share | The table below shows the weighted average number of shares used in computing net income per common share and the effect of the weighted average number of shares of potential dilutive common stock for the three and six months ended June 30, 2022 and 2021. Diluted net income per share is computed based on the weighted average number of shares of common stock equivalents outstanding, to the extent dilutive. The Company’s common stock equivalents relate to outstanding common stock options. Unvested restricted stock as of June 30, 2022 and June 30, 2021 is included in the calculation of basic and diluted net income per share (dollars below reported in thousands except per share data). Three Months Ended June 30, 2022 June 30, 2021 Net Weighted Per Net Weighted Per Basic net income per share $ 5,685 5,326,271 $ 1.07 $ 147 5,305,277 $ 0.03 Effect of dilutive stock options - 20,737 ( 0.01 ) - 15,013 - Diluted net income per share $ 5,685 5,347,008 $ 1.06 $ 147 5,320,290 $ 0.03 Six Months Ended June 30, 2022 June 30, 2021 Net Weighted Per Net Weighted Per Basic net income per share $ 10,609 5,319,166 $ 1.99 $ 1,652 4,019,700 $ 0.41 Effect of dilutive stock options - 26,076 ( 0.01 ) - 11,601 - Diluted net income per share $ 10,609 $ 5,345,242 $ 1.98 $ 1,652 4,031,301 $ 0.41 |
Stock Incentive Plans (Tables)
Stock Incentive Plans (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Summary of Shares Issued and Available Under Each Plans | A summary of the shares issued and available under each of the Plans is shown below as of June 30, 2022 . Share data and exercise price range per share have been adjusted to reflect prior issued stock dividends. Although the 2005 Plan has expired and no new grants will be issued under this plan, there were options issued before the plan expired that are still outstanding as shown below. No grants have been issued under the 2022 Plan. 2022 Plan 2014 Plan 2005 Plan Aggregate shares issuable 150,000 275,625 253,575 Options issued, net of forfeited and expired — ( 170,106 ) ( 59,870 ) Unrestricted stock issued — ( 11,635 ) — Restricted stock grants issued, net of forfeited — ( 65,853 ) — Cancelled due to Plan expiration — — ( 193,705 ) Remaining available for grant 150,000 28,031 - Stock grants issued and outstanding: Total vested and unvested shares — 77,488 — Fully vested shares — 31,764 — Option grants issued and outstanding: Total vested and unvested shares — 167,901 1,379 Fully vested shares — 76,148 1,379 Exercise price range $ — $ 23.75 to $ 42.62 $ 13.69 |
Summary of Stock Option Activity | Changes in the stock options outstanding related to the Plans are summarized below (dollars in thousands except per share data): June 30, 2022 Number of Options Weighted Average Aggregate Outstanding at January 1, 2022 169,280 $ 33.89 $ 962 Issued — — Exercised — — Expired — — Outstanding at June 30, 2022 169,280 $ 33.89 $ 477 Options exercisable at June 30, 2022 77,527 $ 37.31 $ 144 |
Schedule of Options Outstanding and Exercisable, by Exercise Price Range | Summary information pertaining to options outstanding at June 30, 2022 is shown below. Share and per share data have been adjusted to reflect the prior stock dividends issued. Options Outstanding Options Exercisable Exercise Price Number of Weighted- Weighted- Number of Weighted- $ 13.69 to $ 20.00 1,379 0.6 Years $ 13.69 1,379 $ 13.69 $ 20.01 to $ 30.00 66,000 8.0 Years 24.64 18,400 25.02 $ 30.01 to $ 40.00 44,420 8.1 Years 36.97 11,772 38.52 $ 40.01 to $ 42.62 57,481 5.9 Years 42.62 45,976 42.62 Total 169,280 7.3 Years $ 33.89 77,527 $ 37.31 |
Summary of Changes in the Restricted Stock Grants Outstanding | Changes in the restricted stock grants outstanding during the six months ended June 30, 2022 are summarized below (dollars in thousands except per share data): June 30, 2022 Number of Weighted Aggregate Nonvested as of January 1, 2022 37,011 $ 28.98 $ 1,165 Issued 18,536 35.62 584 Vested ( 9,223 ) ( 27.38 ) ( 290 ) Forfeited ( 600 ) ( 33.74 ) ( 19 ) Nonvested at June 30, 2022 45,724 $ 31.94 $ 1,440 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Fair Value Disclosures [Abstract] | |
Schedule of Available for Sale Securities Measured at Fair Value on a Recurring Basis | The following tables present the balances measured at fair value on a recurring basis as of June 30, 2022 and December 31, 2021 (dollars in thousands): Fair Value Measurements at June 30, 2022 Using: Quoted Prices Significant Significant Description Balance (Level 1) (Level 2) (Level 3) Assets: U.S. Government treasuries $ 161,009 $ - $ 161,009 $ - U.S. Government agencies 30,532 - 30,532 - Mortgage-backed securities/CMOs 175,962 - 175,962 - Corporate bonds 11,154 - 11,154 - Municipal bonds 83,173 - 83,173 - Total securities available for sale $ 461,830 $ - $ 461,830 $ - Interest rate swap asset 310 - 310 - Total assets at fair value $ 462,140 $ - $ 462,140 $ - Fair Value Measurements at December 31, 2021 Using: Quoted Prices Significant Significant Description Balance (Level 1) (Level 2) (Level 3) Assets: U.S. Government agencies $ 31,581 $ - $ 31,581 $ - Mortgage-backed securities/CMOs 170,964 - 170,964 - Municipal bonds 101,272 - 101,272 - Total securities available for sale $ 303,817 $ - $ 303,817 $ - Liabilities: Interest rate swap liabilities $ 197 $ - $ 197 $ - Total liabilities at fair value $ 197 $ - $ 197 $ - |
Summary of Assets Measured at Fair Value on a Nonrecurring Basis | The following table presents the Company’s assets that were measured at fair value on a nonrecurring basis as of December 31, 2021 . There were no such assets to report as of June 30, 2022. Fair Value Measurements at December 31, 2021 Using: Quoted Prices Significant Significant Description Balance (Level 1) (Level 2) (Level 3) Assets: Other Real Estate Owned $ 611 $ - $ - 61100.0 % For the assets measured at fair value on a nonrecurring basis as of December 31, 2021 , the following table displays quantitative information about Level 3 Fair Value Measurements (dollars in thousands). There were no such assets to report as of June 30, 2022. Description Fair Value Valuation Technique Unobservable Inputs Weighted Average Assets: Other Real Estate Owned $ 611 Market comparables Discount applied to bonafide offer 6.0 % * A discount percentage is applied based on estimated cost to sell. |
Summary of Quantitative Information About Level 3 Fair Value Measurements | For the assets measured at fair value on a nonrecurring basis as of December 31, 2021 , the following table displays quantitative information about Level 3 Fair Value Measurements (dollars in thousands). There were no such assets to report as of June 30, 2022. Description Fair Value Valuation Technique Unobservable Inputs Weighted Average Assets: Other Real Estate Owned $ 611 Market comparables Discount applied to bonafide offer 6.0 % * A discount percentage is applied based on estimated cost to sell. |
Schedule of the Carrying Values and Estimated Fair Values of the Bank's Financial Instruments | The carrying values and estimated fair values of the Company's financial instruments as of June 30, 2022 and December 31, 2021 are as follows (dollars in thousands): Fair Value Measurements at June 30, 2022 Using: Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs Carrying value Level 1 Level 2 Level 3 Fair Value Assets Cash and cash equivalent $ 215,667 $ 215,667 $ - $ - $ 215,667 Available for sale securities 461,830 - 461,830 - 461,830 Loans, net 954,689 - - 929,045 929,045 Bank owned life insurance 38,046 - 38,046 - 38,046 Accrued interest receivable 4,229 - 2,055 2,174 4,229 Interest rate swap asset 310 - 310 - 310 Liabilities Demand deposits and interest-bearing transaction and money market accounts $ 1,448,777 $ - $ 1,448,777 $ - $ 1,448,777 Certificates of deposit 150,121 - 144,556 - 144,556 Junior subordinated debt, net 3,390 - 3,459 - 3,459 Accrued interest payable 134 - 134 - 134 Fair Value Measurements at December 31, 2021 Using: Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs Carrying value Level 1 Level 2 Level 3 Fair Value Assets Cash and cash equivalent $ 508,840 $ 508,840 $ - $ - $ 508,840 Available for sale securities 303,817 - 303,817 - 303,817 Loans, net 1,055,227 - - 1,059,650 1,059,650 Bank owned life insurance 31,234 - 31,234 - 31,234 Other real estate owned, net 611 - - 611 611 Accrued interest receivable 3,778 - 1,252 2,526 3,778 Liabilities Demand deposits and interest-bearing transaction and money market accounts $ 1,634,125 $ - $ 1,634,125 $ - $ 1,634,125 Certificates of deposit 162,045 - 161,850 - 161,850 Junior subordinated debt 3,367 - 3,367 - 3,367 Accrued interest payable 174 - 174 - 174 Interest rate swap liabilities 197 - 197 - 197 |
Other Comprehensive Income (L_2
Other Comprehensive Income (Loss) (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Other Comprehensive Income (Loss), Tax [Abstract] | |
Schedule of Cumulative Balances of the Components of Accumulated Other Comprehensive Income (Loss), Net of Deferred Taxes | The following table presents the cumulative balances of the components of accumulated other comprehensive income (loss), net of deferred taxes of ($ 7.9 ) million and ($ 464 ) thousand, as of June 30, 2022 and December 31, 2021, respectively (dollars in thousands). June 30, 2022 December 31, 2021 Accumulated other comprehensive loss on securities $ ( 38,026 ) $ ( 2,164 ) Accumulated other comprehensive income (loss) on interest rate swap 331 ( 47 ) Total accumulated other comprehensive loss $ ( 37,695 ) $ ( 2,211 ) |
Derivatives Instruments and H_2
Derivatives Instruments and Hedging Activities (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Summary of Derivative Instruments | The follow table summarizes the Company’s derivative instruments as of June 30, 2022 and December 31, 2021 (dollars in thousands): June 30, 2022 Derivatives designated as hedging instruments Notional/ Contract Amount Fair Value Fair Value Balance Sheet Location Expiration Date Interest rate forward swap - cash flow $ 4,000 $ 310 Other Liabilities 6/15/2031 December 31, 2021 Derivatives designated as hedging instruments Notional/ Contract Amount Fair Value Fair Value Balance Sheet Location Expiration Date Interest rate forward swap - cash flow $ 4,000 $ ( 197 ) Other Liabilities 6/15/2031 Interest rate swap - fair value $ 3,940 $ ( 8 ) Other Liabilities 2/12/2022 |
Segment Reporting (Tables)
Segment Reporting (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Segment Reporting [Abstract] | |
Schedule of segment reporting information | Segment information for the three and six months ended June 30, 2022 and 2021 is shown in the following tables (dollars in thousands). Note that asset information is not reported below, as the assets of Sturman Wealth Advisors and VNB Trust & Estate Services are reported at the Bank level; also, assets specifically allocated to the lines of business other than the Bank are insignificant and are no longer provided to the chief operating decision maker. Three months ended June 30, 2022 Bank Sturman Wealth Advisors VNB Trust & Masonry Consolidated Net interest income $ 12,461 $ - $ - $ - $ 12,461 Provision for (recovery of) loan losses ( 217 ) - - - $ ( 217 ) Noninterest income 2,851 210 365 220 $ 3,646 Noninterest expense 8,717 161 376 188 $ 9,442 Income (loss) before income taxes 6,812 49 ( 11 ) 32 6,882 Provision for (benefit from) income 1,181 11 ( 2 ) 7 1,197 Net income (loss) $ 5,631 $ 38 $ ( 9 ) $ 25 $ 5,685 Six months ended June 30, 2022 Bank Sturman Wealth Advisors VNB Trust & Masonry Consolidated Net interest income $ 23,886 $ - $ - $ - $ 23,886 Provision for (recovery of) loan losses ( 69 ) - - - ( 69 ) Noninterest income 4,385 426 3,196 426 8,433 Noninterest expense 17,538 327 1,298 374 19,537 Income before income taxes 10,802 99 1,898 52 12,851 Provision for income taxes 1,811 21 399 11 2,242 Net income $ 8,991 $ 78 $ 1,499 $ 41 $ 10,609 Three months ended June 30, 2021 Bank Sturman Wealth Advisors VNB Trust & Masonry Consolidated Net interest income $ 13,151 $ - $ - $ - $ 13,151 Provision for (recovery of) loan losses ( 141 ) - - - ( 141 ) Noninterest income 2,356 202 203 159 2,920 Noninterest expense 15,416 167 215 195 15,993 Income (loss) before income taxes 232 35 ( 12 ) ( 36 ) 219 Provision for (benefit from) income 75 7 ( 3 ) ( 7 ) 72 Net income (loss) $ 157 $ 28 $ ( 9 ) $ ( 29 ) $ 147 Six months ended June 30, 2021 Bank Sturman Wealth Advisors VNB Trust & Masonry Consolidated Net interest income $ 19,125 $ - $ - $ - $ 19,125 Provision for loan losses 210 - - - 210 Noninterest income 2,870 393 404 292 3,959 Noninterest expense 19,671 327 421 355 20,774 Income (loss) before income taxes 2,114 66 ( 17 ) ( 63 ) 2,100 Provision for (benefit from) income 451 14 ( 4 ) ( 13 ) 448 Net income (loss) $ 1,663 $ 52 $ ( 13 ) $ ( 50 ) $ 1,652 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies - Additional Information (Details) - Fauquier Bankshares, Inc [Member] $ in Millions | Apr. 01, 2021 USD ($) |
Organization And Significant Accounting Policies [Line Items] | |
Acquisition date | Apr. 01, 2021 |
Business acquisition, Total consideration paid | $ 78 |
Business Combinations - Additio
Business Combinations - Additional Information (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||||
Apr. 01, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | ||
Business Acquisition [Line Items] | |||||||
Goodwill | $ 7,768,000 | $ 8,140,000 | $ 8,140,000 | $ 8,140,000 | [1] | ||
Other intangible assets | 7,600,000 | $ 8,600,000 | 7,600,000 | $ 8,600,000 | 8,500,000 | ||
Short-term borrowings | 13,055,000 | ||||||
Junior subordinated debt | $ (3,334,000) | ||||||
Fauquier Bankshares, Inc [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Acquisition date | Apr. 01, 2021 | ||||||
Equity interest issued or issuable share ratio | 0.675 | ||||||
Business combination consideration issued in shares | 2,571,213 | ||||||
Business combination consideration paid in cash | $ 4,000 | ||||||
Goodwill | 7,800,000 | ||||||
Other intangible assets | 9,700,000 | ||||||
Loan aggregate outstanding principal | 622,900,000 | ||||||
Estimated fair value of loan | 602,600,000 | $ 611,000 | |||||
Allowance for loan losses | 20,300,000 | ||||||
Adjustment for market interest rates, net of deferred costs | 21,300,000 | ||||||
Deferred fees/costs | 979,000 | ||||||
Short-term borrowings | 12,582,000 | ||||||
Junior subordinated debt | (4,124,000) | ||||||
Merger and merger related expenses | $ 0 | $ 5,900,000 | $ 0 | $ 6,200,000 | |||
Allowance for loan losses | 7,200,000 | ||||||
Fauquier Bankshares, Inc [Member] | Fair Value Adjustment [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Short-term borrowings | 473,000 | ||||||
Junior subordinated debt | 790,000 | ||||||
Fauquier Bankshares, Inc [Member] | Certificates of Deposit [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Estimated fair value adjustment of certificates of deposit | $ 191,000 | ||||||
Certificates of Deposit Amortization Period | 36 months | ||||||
Fauquier Bankshares, Inc [Member] | Certificates of Deposit [Member] | Minimum [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Certificates of deposit maturity | 1 month | ||||||
Fauquier Bankshares, Inc [Member] | Certificates of Deposit [Member] | Maximum [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Certificates of deposit maturity | 3 years | ||||||
Fauquier Bankshares, Inc [Member] | Performing Loans [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Fair value of loans | $ 513,800,000 | ||||||
Percentage of loans less than book value of loans | 1.70% | ||||||
Total fair value discount on performing loans | $ 9,000,000 | ||||||
Credit discount | 8,400,000 | ||||||
Other fair value discount | 647,000 | ||||||
Fauquier Bankshares, Inc [Member] | PCI Loans [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Fair value of loans | $ 87,300,000 | ||||||
Percentage of loans less than book value of loans | 12.30% | ||||||
Credit discount | $ 11,200,000 | ||||||
Other fair value discount | 1,100,000 | ||||||
Total fair value on PCI loans | $ 12,300,000 | ||||||
Fauquier Bankshares, Inc [Member] | Core Deposit [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Core deposit intangible asset, amortization period | 7 years | ||||||
Estimated core deposit intangibles | $ 9,700,000 | ||||||
Percentage of core deposits intangibles estimated | 1.30% | ||||||
[1] Derived from audited Consolidated Financial Statements |
Business Combinations - Summary
Business Combinations - Summary of Total Consideration Paid in Connection with Merger (Details) - USD ($) $ in Thousands | Apr. 01, 2021 | Jun. 30, 2022 | Dec. 31, 2021 | [1] |
Assets: | ||||
Cash and cash equivalents | $ 153,282 | |||
Securities available for sale | 93,133 | |||
Restricted securities | 1,619 | |||
Loans, net | 602,643 | |||
Premises and equipment | 20,148 | |||
Other real estate owned | 611 | |||
Bank-owned life insurance | 13,677 | |||
Right-of-use assets | 5,432 | |||
Core deposit intangible | 9,660 | |||
Other assets | 10,289 | |||
Total assets acquired | 910,494 | |||
Liabilities: | ||||
Deposits | 817,690 | |||
Short-term borrowings | 13,055 | |||
Junior subordinated debt | 3,334 | |||
Lease liability | 4,792 | |||
Other liabilities | 1,355 | |||
Total liabilities assumed | 840,226 | |||
Net assets acquired | 70,268 | |||
Total consideration paid | 78,036 | |||
Goodwill | 7,768 | $ 8,140 | $ 8,140 | |
Fauquier Bankshares, Inc [Member] | ||||
Assets: | ||||
Cash and cash equivalents | 153,282 | |||
Securities available for sale | 93,133 | |||
Restricted securities | 1,619 | |||
Loans, net | 615,766 | |||
Premises and equipment | 16,276 | |||
Other real estate owned | 1,356 | |||
Bank-owned life insurance | 13,677 | |||
Right-of-use assets | 4,355 | |||
Other assets | 11,298 | |||
Total assets acquired | 910,762 | |||
Liabilities: | ||||
Deposits | 817,499 | |||
Short-term borrowings | 12,582 | |||
Junior subordinated debt | 4,124 | |||
Lease liability | 4,440 | |||
Other liabilities | 1,355 | |||
Total liabilities assumed | 840,000 | |||
Total consideration paid | 78,000 | |||
Goodwill | 7,800 | |||
Fauquier Bankshares, Inc [Member] | Fair Value Adjustment [Member] | ||||
Assets: | ||||
Loans, net | (13,123) | |||
Premises and equipment | 3,872 | |||
Other real estate owned | (745) | |||
Right-of-use assets | 1,077 | |||
Core deposit intangible | 9,660 | |||
Other assets | (1,009) | |||
Total assets acquired | (268) | |||
Liabilities: | ||||
Deposits | 191 | |||
Short-term borrowings | 473 | |||
Junior subordinated debt | (790) | |||
Lease liability | 352 | |||
Total liabilities assumed | $ 226 | |||
[1] Derived from audited Consolidated Financial Statements |
Business Combinations - Summa_2
Business Combinations - Summary of Information About Purchased Credit Impaired (PCI) Loans (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Apr. 01, 2021 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | |
Schedule Of Information About Purchased Credit Impaired Loans [Line Items] | |||||
Nonaccretable difference | $ 2,193 | ||||
Fauquier Bankshares, Inc [Member] | |||||
Schedule Of Information About Purchased Credit Impaired Loans [Line Items] | |||||
Contractual principal and interest at acquisition | $ 136,476 | $ 371,527 | $ 448,780 | ||
Nonaccretable difference | (33,712) | ||||
Expected cash flows at acquisition | 102,764 | ||||
Accretable yield | (15,499) | $ (15,499) | $ (15,499) | ||
Basis in PCI loans at acquisition, estimated fair value | $ 87,265 |
Securities (Amortized Cost and
Securities (Amortized Cost and Fair Values of Securities Available for Sale) (Details)) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 | |
Debt Securities, Available-for-sale [Line Items] | |||
Amortized Cost | $ 509,963 | $ 306,535 | |
Gross Unrealized Gains | 30 | 1,434 | |
Gross Unrealized (Losses) | (48,163) | (4,152) | |
Available for Sale, Fair Value | 461,830 | 303,817 | [1] |
U.S. Government treasuries [Member] | |||
Debt Securities, Available-for-sale [Line Items] | |||
Amortized Cost | 162,019 | ||
Gross Unrealized (Losses) | (1,010) | ||
Available for Sale, Fair Value | 161,009 | ||
U.S. Government agencies [Member] | |||
Debt Securities, Available-for-sale [Line Items] | |||
Amortized Cost | 35,313 | 32,424 | |
Gross Unrealized Gains | 24 | ||
Gross Unrealized (Losses) | (4,781) | (867) | |
Available for Sale, Fair Value | 30,532 | 31,581 | |
Mortgage-backed securities/CMOs [Member] | |||
Debt Securities, Available-for-sale [Line Items] | |||
Amortized Cost | 197,121 | 172,975 | |
Gross Unrealized Gains | 19 | 248 | |
Gross Unrealized (Losses) | (21,177) | (2,259) | |
Available for Sale, Fair Value | 175,962 | 170,964 | |
Corporate bonds [Member] | |||
Debt Securities, Available-for-sale [Line Items] | |||
Amortized Cost | 11,483 | ||
Gross Unrealized Gains | 4 | ||
Gross Unrealized (Losses) | (334) | ||
Available for Sale, Fair Value | 11,154 | ||
Municipal bonds [Member] | |||
Debt Securities, Available-for-sale [Line Items] | |||
Amortized Cost | 104,027 | 101,136 | |
Gross Unrealized Gains | 7 | 1,162 | |
Gross Unrealized (Losses) | (20,861) | (1,026) | |
Available for Sale, Fair Value | $ 83,173 | $ 101,272 | |
[1] Derived from audited Consolidated Financial Statements |
Securities (Narrative) (Details
Securities (Narrative) (Details) | 3 Months Ended | 6 Months Ended | |||||
Jun. 30, 2022 USD ($) Item | Jun. 30, 2021 USD ($) | Jun. 30, 2022 USD ($) Item | Jun. 30, 2021 USD ($) | Mar. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | ||
Schedule of Investments [Line Items] | |||||||
Available-for-sale securities, continuous unrealized loss position, fair value | $ 455,486,000 | $ 455,486,000 | $ 227,492,000 | ||||
Number of securities designated as available for sale securities having unrealized loss | Item | 278 | 278 | |||||
Unrealized loss of available for sale securities | $ 48,163,000 | $ 48,163,000 | 4,152,000 | ||||
Proceeds from the sales of securities | 0 | $ 0 | 0 | $ 0 | |||
Restricted securities, at cost | 5,138,000 | 5,138,000 | 4,950,000 | [1] | |||
Mortgage-backed securities/CMOs [Member] | |||||||
Schedule of Investments [Line Items] | |||||||
Available-for-sale securities, continuous unrealized loss position, fair value | $ 173,063,000 | $ 173,063,000 | 147,068,000 | ||||
Number of securities designated as available for sale securities having unrealized loss | Item | 117 | 117 | |||||
Unrealized loss of available for sale securities | $ 21,177,000 | $ 21,177,000 | 2,259,000 | ||||
U.S. Government agencies [Member] | |||||||
Schedule of Investments [Line Items] | |||||||
Available-for-sale securities, continuous unrealized loss position, fair value | $ 30,532,000 | $ 30,532,000 | 29,663,000 | ||||
Number of securities designated as available for sale securities having unrealized loss | Item | 20 | 20 | |||||
Unrealized loss of available for sale securities | $ 4,781,000 | $ 4,781,000 | 867,000 | ||||
Corporate bonds [Member] | |||||||
Schedule of Investments [Line Items] | |||||||
Available-for-sale securities, continuous unrealized loss position, fair value | $ 9,152,000 | $ 9,152,000 | |||||
Number of securities designated as available for sale securities having unrealized loss | Item | 6 | 6 | |||||
Unrealized loss of available for sale securities | $ 334,000 | $ 334,000 | |||||
Treasury bond [Member] | |||||||
Schedule of Investments [Line Items] | |||||||
Number of securities designated as available for sale securities having unrealized loss | Item | 11 | 11 | |||||
Asset Pledged as Collateral without Right [Member] | Deposits [Member] | |||||||
Schedule of Investments [Line Items] | |||||||
Securities pledged to secure deposits and facilitate borrowing | $ 5,400,000 | 12,700,000 | |||||
Municipal bonds [Member] | |||||||
Schedule of Investments [Line Items] | |||||||
Available-for-sale securities, continuous unrealized loss position, fair value | $ 81,730,000 | $ 81,730,000 | 50,761,000 | ||||
Number of securities designated as available for sale securities having unrealized loss | Item | 124 | 124 | |||||
Unrealized loss of available for sale securities | $ 20,861,000 | $ 20,861,000 | $ 1,026,000 | ||||
[1] Derived from audited Consolidated Financial Statements |
Securities (Schedule of Unreali
Securities (Schedule of Unrealized Losses) (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Debt Securities, Available-for-sale [Line Items] | ||
Continuous Unrealized Loss Position of Less Than 12 Months, Estimated Fair value | $ 382,756 | $ 186,671 |
Continuous Unrealized Loss Position of Less Than 12 Months, Unrealized losses | (33,924) | (2,797) |
Continuous Unrealized Loss Position of 12 Months or More, Estimated Fair value | 72,730 | 40,821 |
Continuous Unrealized Loss Position of 12 Months or More, Unrealized losses | (14,239) | (1,355) |
Total, Estimated Fair value | 455,486 | 227,492 |
Total, Unrealized losses | (48,163) | (4,152) |
U.S. Government treasuries [Member] | ||
Debt Securities, Available-for-sale [Line Items] | ||
Continuous Unrealized Loss Position of Less Than 12 Months, Estimated Fair value | 161,009 | |
Continuous Unrealized Loss Position of Less Than 12 Months, Unrealized losses | (1,010) | |
Total, Estimated Fair value | 161,009 | |
Total, Unrealized losses | (1,010) | |
U.S. Government agencies [Member] | ||
Debt Securities, Available-for-sale [Line Items] | ||
Continuous Unrealized Loss Position of Less Than 12 Months, Estimated Fair value | 11,960 | 14,443 |
Continuous Unrealized Loss Position of Less Than 12 Months, Unrealized losses | (1,207) | (340) |
Continuous Unrealized Loss Position of 12 Months or More, Estimated Fair value | 18,572 | 15,220 |
Continuous Unrealized Loss Position of 12 Months or More, Unrealized losses | (3,574) | (527) |
Total, Estimated Fair value | 30,532 | 29,663 |
Total, Unrealized losses | (4,781) | (867) |
Mortgage-backed securities/CMOs [Member] | ||
Debt Securities, Available-for-sale [Line Items] | ||
Continuous Unrealized Loss Position of Less Than 12 Months, Estimated Fair value | 133,182 | 131,876 |
Continuous Unrealized Loss Position of Less Than 12 Months, Unrealized losses | (15,276) | (1,735) |
Continuous Unrealized Loss Position of 12 Months or More, Estimated Fair value | 39,881 | 15,192 |
Continuous Unrealized Loss Position of 12 Months or More, Unrealized losses | (5,901) | (524) |
Total, Estimated Fair value | 173,063 | 147,068 |
Total, Unrealized losses | (21,177) | (2,259) |
Corporate bonds [Member] | ||
Debt Securities, Available-for-sale [Line Items] | ||
Continuous Unrealized Loss Position of Less Than 12 Months, Estimated Fair value | 9,152 | |
Continuous Unrealized Loss Position of Less Than 12 Months, Unrealized losses | (334) | |
Total, Estimated Fair value | 9,152 | |
Total, Unrealized losses | (334) | |
Municipal bonds [Member] | ||
Debt Securities, Available-for-sale [Line Items] | ||
Continuous Unrealized Loss Position of Less Than 12 Months, Estimated Fair value | 67,453 | 40,352 |
Continuous Unrealized Loss Position of Less Than 12 Months, Unrealized losses | (16,097) | (722) |
Continuous Unrealized Loss Position of 12 Months or More, Estimated Fair value | 14,277 | 10,409 |
Continuous Unrealized Loss Position of 12 Months or More, Unrealized losses | (4,764) | (304) |
Total, Estimated Fair value | 81,730 | 50,761 |
Total, Unrealized losses | $ (20,861) | $ (1,026) |
Securities (Schedule of Amortiz
Securities (Schedule of Amortized Cost and Fair Values of Securities Available For Sale Based upon Contractual Maturities and by Major Investment Categories) (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Amortized Cost | ||
Amortized Cost | $ 509,963 | $ 306,535 |
Fair Value | ||
Total Securities Available for Sale | 461,830 | |
Municipal bonds [Member] | ||
Amortized Cost | ||
One year or less | 502 | |
After one year to five years | 610 | |
After five years to ten years | 17,259 | |
Ten years or more | 85,656 | |
Amortized Cost | 104,027 | 101,136 |
Fair Value | ||
One year or less | 502 | |
After one year to five years | 601 | |
After five years to ten years | 16,039 | |
Ten years or more | 66,031 | |
Total Securities Available for Sale | 83,173 | |
U.S. Government treasuries [Member] | ||
Amortized Cost | ||
One year or less | 69,543 | |
After one year to five years | 92,476 | |
Amortized Cost | 162,019 | |
Fair Value | ||
One year or less | 69,071 | |
After one year to five years | 91,938 | |
Total Securities Available for Sale | 161,009 | |
U.S. Government agencies [Member] | ||
Amortized Cost | ||
After one year to five years | 649 | |
After five years to ten years | 28,664 | |
Ten years or more | 6,000 | |
Amortized Cost | 35,313 | 32,424 |
Fair Value | ||
After one year to five years | 584 | |
After five years to ten years | 25,088 | |
Ten years or more | 4,860 | |
Total Securities Available for Sale | 30,532 | |
Mortgage-backed securities/CMOs [Member] | ||
Amortized Cost | ||
After one year to five years | 11,389 | |
After five years to ten years | 3,211 | |
Ten years or more | 182,521 | |
Amortized Cost | 197,121 | $ 172,975 |
Fair Value | ||
After one year to five years | 10,897 | |
After five years to ten years | 2,971 | |
Ten years or more | 162,094 | |
Total Securities Available for Sale | 175,962 | |
Corporate bonds [Member] | ||
Amortized Cost | ||
After one year to five years | 5,848 | |
After five years to ten years | 5,635 | |
Amortized Cost | 11,483 | |
Fair Value | ||
After one year to five years | 5,798 | |
After five years to ten years | 5,356 | |
Total Securities Available for Sale | $ 11,154 |
Loans (Schedule of Composition
Loans (Schedule of Composition of Loan Portfolio by Major Loan Classifications) (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Loans | $ 960,192 | $ 1,061,211 | |
Less: Allowance for loan losses | (5,503) | (5,984) | [1] |
Loans, net | 954,689 | 1,055,227 | [1] |
Commercial [Member] | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Loans | 77,599 | 96,696 | |
Real Estate Construction and Land [Member] | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Loans | 55,140 | 79,331 | |
1-4 family residential mortgages [Member] | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Loans | 329,920 | 358,148 | |
Commercial mortgages [Member] | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Loans | 446,282 | 473,632 | |
Consumer [Member] | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Loans | $ 51,251 | $ 53,404 | |
[1] Derived from audited Consolidated Financial Statements |
Loans (Narrative) (Details)
Loans (Narrative) (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2022 USD ($) Item | Jun. 30, 2021 USD ($) Item | Jun. 30, 2022 USD ($) Loan Item | Dec. 31, 2021 USD ($) Item Loan | Apr. 01, 2021 USD ($) | |
Loans And Leases Receivable Disclosure [Line Items] | |||||
Unamortized premium | $ 811 | $ 811 | $ 1,100 | ||
Net deferred loan costs (fees) | $ 504 | 504 | (865) | ||
Number of loans modified as TDRs | Item | 0 | 0 | |||
Charged off | 664 | 835 | |||
Fauquier Bankshares, Inc [Member] | |||||
Loans And Leases Receivable Disclosure [Line Items] | |||||
Loan receivable at fair value net | $ 611 | $ 602,600 | |||
Purchased Impaired Loan [Member] | Fauquier Bankshares, Inc [Member] | |||||
Loans And Leases Receivable Disclosure [Line Items] | |||||
Loan receivable at fair value net | $ 12,300 | 12,300 | |||
Purchased Performing Loans [Member] | Fauquier Bankshares, Inc [Member] | |||||
Loans And Leases Receivable Disclosure [Line Items] | |||||
Loan receivable at fair value net | 5,300 | $ 5,300 | |||
Student Loans Purchased [Member] | |||||
Loans And Leases Receivable Disclosure [Line Items] | |||||
Extended period for repayment | 12 months | ||||
Lifetime allowance period for military service | 36 months | ||||
Grace period for repayment | 6 months | ||||
Number of loans modified as TDRs | Item | 5 | ||||
Charged off | $ 56 | ||||
Student Loans Purchased [Member] | Performing Loans [Member] | |||||
Loans And Leases Receivable Disclosure [Line Items] | |||||
Number of Loans classified as troubled debt restructuring | Item | 56 | ||||
Total Troubled Debt Restructurings | $ 835 | ||||
1-4 family residential-purchased [Member] | |||||
Loans And Leases Receivable Disclosure [Line Items] | |||||
Number of secured loans | Loan | 0 | 0 | |||
Paycheck Protection Program (PPP) Loans [Member] | |||||
Loans And Leases Receivable Disclosure [Line Items] | |||||
Bank funded loan amount outstanding | 1,900 | $ 1,900 | |||
COVID-19 [Member] | |||||
Loans And Leases Receivable Disclosure [Line Items] | |||||
Loan deferrals | $ 0 | $ 2,000 | 0 | $ 1,200 | |
Small Business Administration [Member] | Paycheck Protection Program (PPP) Loans [Member] | |||||
Loans And Leases Receivable Disclosure [Line Items] | |||||
Deferred fees increase | 46 | ||||
Small Business Administration [Member] | COVID-19 [Member] | Paycheck Protection Program (PPP) Loans [Member] | |||||
Loans And Leases Receivable Disclosure [Line Items] | |||||
Bank assisted nonprofit organizations and local businesses funded loans | $ 207,500 |
Loans (Summary of Outstanding P
Loans (Summary of Outstanding Principal Balance and Carrying Amount of Loans Acquired in Business Combination) (Details) - Fauquier Bankshares, Inc [Member] - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 | Apr. 01, 2021 |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Contractual principal and interest at acquisition | $ 371,527 | $ 448,780 | $ 136,476 |
Total acquired loans | 354,024 | 430,315 | |
Acquired Loans - Purchased Credit Impaired [Member] | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Contractual principal and interest at acquisition | 56,178 | 76,608 | |
Total acquired loans | 43,926 | 64,383 | |
Acquired Loans - Purchased Performing [Member] | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Contractual principal and interest at acquisition | 315,349 | 372,172 | |
Total acquired loans | 310,098 | 365,932 | |
Commercial [Member] | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Total acquired loans | 16,975 | 29,059 | |
Commercial [Member] | Acquired Loans - Purchased Credit Impaired [Member] | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Contractual principal and interest at acquisition | 994 | ||
Total acquired loans | 702 | ||
Commercial [Member] | Acquired Loans - Purchased Performing [Member] | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Contractual principal and interest at acquisition | 28,065 | ||
Total acquired loans | 16,273 | ||
Real Estate Construction and Land [Member] | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Total acquired loans | 15,672 | 32,873 | |
Real Estate Construction and Land [Member] | Acquired Loans - Purchased Credit Impaired [Member] | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Contractual principal and interest at acquisition | 18,576 | ||
Total acquired loans | 6,539 | ||
Real Estate Construction and Land [Member] | Acquired Loans - Purchased Performing [Member] | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Contractual principal and interest at acquisition | 14,297 | ||
Total acquired loans | 9,133 | ||
1-4 Family Residential Mortgages [Member] | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Total acquired loans | 185,034 | 210,728 | |
1-4 Family Residential Mortgages [Member] | Acquired Loans - Purchased Credit Impaired [Member] | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Contractual principal and interest at acquisition | 16,020 | ||
Total acquired loans | 11,900 | ||
1-4 Family Residential Mortgages [Member] | Acquired Loans - Purchased Performing [Member] | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Contractual principal and interest at acquisition | 194,708 | ||
Total acquired loans | 173,134 | ||
Commercial Mortgages [Member] | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Total acquired loans | 134,574 | 155,313 | |
Commercial Mortgages [Member] | Acquired Loans - Purchased Credit Impaired [Member] | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Contractual principal and interest at acquisition | 28,675 | ||
Total acquired loans | 24,694 | ||
Commercial Mortgages [Member] | Acquired Loans - Purchased Performing [Member] | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Contractual principal and interest at acquisition | 126,638 | ||
Total acquired loans | 109,880 | ||
Consumer [Member] | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Total acquired loans | 1,769 | 2,342 | |
Consumer [Member] | Acquired Loans - Purchased Credit Impaired [Member] | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Contractual principal and interest at acquisition | 118 | ||
Total acquired loans | 91 | ||
Consumer [Member] | Acquired Loans - Purchased Performing [Member] | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Contractual principal and interest at acquisition | $ 2,224 | ||
Total acquired loans | $ 1,678 |
Loans (Summary of Changes in Ac
Loans (Summary of Changes in Accretable Yield of Loans Classified as Purchased Credit Impaired) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Apr. 01, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Reclassification from (to) nonaccretable difference | $ 2,193 | ||||
Other changes, net | (2,768) | ||||
Fauquier Bankshares, Inc [Member] | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Accretable yield, beginning of period | $ 12,428 | 13,742 | |||
Additions | $ 15,499 | $ 15,499 | $ 15,499 | ||
Accretion | (761) | (858) | (1,500) | (858) | |
Reclassification from (to) nonaccretable difference | $ (33,712) | ||||
Accretable yield, end of period | $ 11,667 | $ 14,641 | $ 11,667 | $ 14,641 |
Loans (Impaired Loans by Loan C
Loans (Impaired Loans by Loan Classification) (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Financing Receivable, Impaired [Line Items] | ||
Recorded Investment, without a valuation allowance | $ 604 | $ 594 |
Unpaid Principal Balance, without a valuation allowance | 626 | 637 |
Average Recorded Investment, without a valuation allowance | 613 | 271 |
Interest Income Recognized, without a valuation allowance | 2 | 24 |
Recorded Investment, with a valuation allowance | 835 | 935 |
Unpaid Principal Balance, with a valuation allowance | 835 | 935 |
Associated Allowance, with a valuation allowance | 9 | 6 |
Average Recorded Investment, with a valuation allowance | 840 | 974 |
Interest Income Recognized, with a valuation allowance | 26 | 54 |
Recorded Investment, total | 1,439 | 1,529 |
Unpaid Principal Balance, total | 1,461 | 1,572 |
Associated Allowance, total | 9 | 6 |
Average Recorded Investment, total | 1,453 | 1,245 |
Interest Income Recognized, total | 28 | 78 |
1-4 Family Residential Mortgages [Member] | ||
Financing Receivable, Impaired [Line Items] | ||
Recorded Investment, without a valuation allowance | 604 | 594 |
Unpaid Principal Balance, without a valuation allowance | 626 | 600 |
Average Recorded Investment, without a valuation allowance | 613 | 269 |
Interest Income Recognized, without a valuation allowance | 2 | 24 |
Commercial Real Estate [Member] | ||
Financing Receivable, Impaired [Line Items] | ||
Unpaid Principal Balance, without a valuation allowance | 37 | |
Average Recorded Investment, without a valuation allowance | 2 | |
Consumer [Member] | ||
Financing Receivable, Impaired [Line Items] | ||
Recorded Investment, with a valuation allowance | 835 | 935 |
Unpaid Principal Balance, with a valuation allowance | 835 | 935 |
Associated Allowance, with a valuation allowance | 9 | 6 |
Average Recorded Investment, with a valuation allowance | 840 | 974 |
Interest Income Recognized, with a valuation allowance | $ 26 | $ 54 |
Loans (Non-Accrual Loans by Loa
Loans (Non-Accrual Loans by Loan Classification) (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Total non-accrual loans | $ 511 | $ 495 |
1-4 Family Residential Mortgages [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Total non-accrual loans | $ 511 | $ 495 |
Loans (Schedule of Troubled Deb
Loans (Schedule of Troubled Debt Restructurings) (Details) $ in Thousands | Jun. 30, 2022 USD ($) Item | Dec. 31, 2021 USD ($) Item |
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Number of loans | Item | 59 | 60 |
Total Troubled Debt Restructurings | $ | $ 1,439 | $ 1,529 |
Performing [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Number of loans | Item | 57 | 59 |
Total Troubled Debt Restructurings | $ | $ 928 | $ 1,034 |
Performing [Member] | 1-4 Family Residential Mortgages [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Number of loans | Item | 1 | 1 |
Total Troubled Debt Restructurings | $ | $ 93 | $ 99 |
Performing [Member] | Consumer [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Number of loans | Item | 56 | 58 |
Total Troubled Debt Restructurings | $ | $ 835 | $ 935 |
Nonperforming [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Number of loans | Item | 2 | 1 |
Total Troubled Debt Restructurings | $ | $ 511 | $ 495 |
Nonperforming [Member] | 1-4 Family Residential Mortgages [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Number of loans | Item | 2 | 1 |
Total Troubled Debt Restructurings | $ | $ 511 | $ 495 |
Loans (Schedule of Loans Modifi
Loans (Schedule of Loans Modified Under the Terms of a TDR) (Details) $ in Thousands | 6 Months Ended | |
Jun. 30, 2022 USD ($) Item | Jun. 30, 2021 USD ($) Item | |
Financing Receivable, Troubled Debt Restructuring [Line Items] | ||
Number of Loans | Item | 1 | 6 |
Pre-Modification Recorded Balance | $ 54 | $ 63 |
Post-Modification Recorded Balance | $ 54 | $ 63 |
Consumer [Member] | ||
Financing Receivable, Troubled Debt Restructuring [Line Items] | ||
Number of Loans | Item | 6 | |
Pre-Modification Recorded Balance | $ 63 | |
Post-Modification Recorded Balance | $ 63 | |
1-4 Family Residential Mortgages [Member] | ||
Financing Receivable, Troubled Debt Restructuring [Line Items] | ||
Number of Loans | Item | 1 | |
Pre-Modification Recorded Balance | $ 54 | |
Post-Modification Recorded Balance | $ 54 |
Allowance for Loan Losses (Narr
Allowance for Loan Losses (Narrative) (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2022 | Dec. 31, 2021 | |
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Impaired loans | $ 1,439 | $ 1,529 |
Individually evaluated for impairment | $ 9 | $ 6 |
Minute Lender Loans [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Percentage of loss rate | 4% | |
Good [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Percentage of nominal loss reserve | 0.15% |
Allowance for Loan Losses (Loan
Allowance for Loan Losses (Loan Portfolio Designated by the Internal Risk Ratings Assigned to Each Credit) (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Loans | $ 960,192 | $ 1,061,211 |
Commercial [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Loans | 77,599 | 96,696 |
Real Estate Construction and Land [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Loans | 55,140 | 79,331 |
1-4 family residential mortgages [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Loans | 329,920 | 358,148 |
Commercial mortgages [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Loans | 446,282 | 473,632 |
Consumer [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Loans | 51,251 | 53,404 |
Excellent [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Loans | 31,154 | 46,386 |
Excellent [Member] | Commercial [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Loans | 30,684 | 45,862 |
Excellent [Member] | Consumer [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Loans | 470 | 524 |
Good [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Loans | 34,553 | 34,485 |
Good [Member] | Commercial [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Loans | 14,136 | 13,920 |
Good [Member] | 1-4 family residential mortgages [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Loans | 2,030 | |
Good [Member] | Consumer [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Loans | 20,417 | 18,535 |
Pass [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Loans | 805,316 | 832,787 |
Pass [Member] | Commercial [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Loans | 30,445 | 32,460 |
Pass [Member] | Real Estate Construction and Land [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Loans | 47,821 | 51,098 |
Pass [Member] | 1-4 family residential mortgages [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Loans | 314,514 | 334,300 |
Pass [Member] | Commercial mortgages [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Loans | 383,299 | 382,108 |
Pass [Member] | Consumer [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Loans | 29,237 | 32,821 |
Watch [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Loans | 54,942 | 75,893 |
Watch [Member] | Commercial [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Loans | 1,291 | 732 |
Watch [Member] | Real Estate Construction and Land [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Loans | 342 | 7,360 |
Watch [Member] | 1-4 family residential mortgages [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Loans | 6,953 | 5,013 |
Watch [Member] | Commercial mortgages [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Loans | 45,396 | 61,563 |
Watch [Member] | Consumer [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Loans | 960 | 1,225 |
Special Mention [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Loans | 9,912 | 14,723 |
Special Mention [Member] | Commercial [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Loans | 110 | 1,645 |
Special Mention [Member] | Real Estate Construction and Land [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Loans | 1,446 | 2,849 |
Special Mention [Member] | 1-4 family residential mortgages [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Loans | 839 | 1,520 |
Special Mention [Member] | Commercial mortgages [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Loans | 7,416 | 8,530 |
Special Mention [Member] | Consumer [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Loans | 101 | 179 |
Substandard [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Loans | 24,315 | 56,937 |
Substandard [Member] | Commercial [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Loans | 933 | 2,077 |
Substandard [Member] | Real Estate Construction and Land [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Loans | 5,531 | 18,024 |
Substandard [Member] | 1-4 family residential mortgages [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Loans | 7,614 | 15,285 |
Substandard [Member] | Commercial mortgages [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Loans | 10,171 | 21,431 |
Substandard [Member] | Consumer [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Loans | $ 66 | $ 120 |
Allowance for Loan Losses (Summ
Allowance for Loan Losses (Summary of Transactions in Allowance for Loan Losses by Major Loan Portfolio Segment) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | |
Allowance for Loan Losses: | |||||
Beginning Balance | $ 5,984 | $ 5,455 | $ 5,455 | ||
Charge-offs | (664) | (835) | |||
Recoveries | 252 | 350 | |||
Provision for (recovery of) loan losses | $ (217) | $ (141) | (69) | 210 | 1,014 |
Ending Balance | 5,503 | 5,503 | 5,984 | ||
Ending balance: Individually evaluated for impairment | 9 | 9 | 6 | ||
Ending balance: Collectively evaluated for impairment | 5,494 | 5,494 | 5,978 | ||
Loans: | |||||
Individually evaluated for impairment | 1,439 | 1,439 | 1,529 | ||
Collectively evaluated for impairment | 914,827 | 914,827 | 995,299 | ||
Acquired loans - purchased credit impaired | 43,926 | 43,926 | 64,383 | ||
Ending Balance | 960,192 | 960,192 | 1,061,211 | ||
Commercial Loans [Member] | |||||
Allowance for Loan Losses: | |||||
Beginning Balance | 252 | 209 | 209 | ||
Charge-offs | (243) | (147) | |||
Recoveries | 136 | 191 | |||
Provision for (recovery of) loan losses | 110 | (1) | |||
Ending Balance | 255 | 255 | 252 | ||
Ending balance: Collectively evaluated for impairment | 255 | 255 | 252 | ||
Loans: | |||||
Collectively evaluated for impairment | 76,897 | 76,897 | 95,702 | ||
Acquired loans - purchased credit impaired | 702 | 702 | 994 | ||
Ending Balance | 77,599 | 77,599 | 96,696 | ||
Real Estate Construction and Land [Member] | |||||
Allowance for Loan Losses: | |||||
Beginning Balance | 399 | 160 | 160 | ||
Recoveries | 8 | 12 | |||
Provision for (recovery of) loan losses | (51) | 227 | |||
Ending Balance | 356 | 356 | 399 | ||
Ending balance: Collectively evaluated for impairment | 356 | 356 | 399 | ||
Loans: | |||||
Collectively evaluated for impairment | 48,601 | 48,601 | 60,755 | ||
Acquired loans - purchased credit impaired | 6,539 | 6,539 | 18,576 | ||
Ending Balance | 55,140 | 55,140 | 79,331 | ||
Real Estate Mortgages [Member] | |||||
Allowance for Loan Losses: | |||||
Beginning Balance | 4,478 | 3,897 | 3,897 | ||
Recoveries | 4 | 6 | |||
Provision for (recovery of) loan losses | (300) | 575 | |||
Ending Balance | 4,182 | 4,182 | 4,478 | ||
Ending balance: Collectively evaluated for impairment | 4,182 | 4,182 | 4,478 | ||
Loans: | |||||
Individually evaluated for impairment | 604 | 604 | 594 | ||
Collectively evaluated for impairment | 739,004 | 739,004 | 786,491 | ||
Acquired loans - purchased credit impaired | 36,594 | 36,594 | 44,695 | ||
Ending Balance | 776,202 | 776,202 | 831,780 | ||
Consumer Loans [Member] | |||||
Allowance for Loan Losses: | |||||
Beginning Balance | 855 | $ 1,189 | 1,189 | ||
Charge-offs | (421) | (688) | |||
Recoveries | 104 | 141 | |||
Provision for (recovery of) loan losses | 172 | 213 | |||
Ending Balance | 710 | 710 | 855 | ||
Ending balance: Individually evaluated for impairment | 9 | 9 | 6 | ||
Ending balance: Collectively evaluated for impairment | 701 | 701 | 849 | ||
Loans: | |||||
Individually evaluated for impairment | 835 | 835 | 935 | ||
Collectively evaluated for impairment | 50,325 | 50,325 | 52,351 | ||
Acquired loans - purchased credit impaired | 91 | 91 | 118 | ||
Ending Balance | $ 51,251 | $ 51,251 | $ 53,404 |
Allowance for Loan Losses (Sche
Allowance for Loan Losses (Schedule of Aging of Past Due Loans) (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Financing Receivable Recorded Investment Past Due [Line Items] | ||
PCI | $ 43,926 | $ 64,383 |
Total Loans | 960,192 | 1,061,211 |
90 Days Past Due and Still Accruing | 626 | 801 |
30-59 Days [Member] | ||
Financing Receivable Recorded Investment Past Due [Line Items] | ||
Total Past Due | 2,319 | 3,111 |
60-89 Days [Member] | ||
Financing Receivable Recorded Investment Past Due [Line Items] | ||
Total Past Due | 697 | 1,934 |
90 Days or More [Member] | ||
Financing Receivable Recorded Investment Past Due [Line Items] | ||
Total Past Due | 626 | 1,296 |
Past Due [Member] | ||
Financing Receivable Recorded Investment Past Due [Line Items] | ||
Total Past Due | 3,642 | 6,341 |
Current [Member] | ||
Financing Receivable Recorded Investment Past Due [Line Items] | ||
Total Past Due | 912,624 | 990,487 |
Commercial [Member] | ||
Financing Receivable Recorded Investment Past Due [Line Items] | ||
PCI | 702 | 994 |
Total Loans | 77,599 | 96,696 |
90 Days Past Due and Still Accruing | 596 | 718 |
Commercial [Member] | 30-59 Days [Member] | ||
Financing Receivable Recorded Investment Past Due [Line Items] | ||
Total Past Due | 762 | 385 |
Commercial [Member] | 60-89 Days [Member] | ||
Financing Receivable Recorded Investment Past Due [Line Items] | ||
Total Past Due | 235 | 355 |
Commercial [Member] | 90 Days or More [Member] | ||
Financing Receivable Recorded Investment Past Due [Line Items] | ||
Total Past Due | 596 | 718 |
Commercial [Member] | Past Due [Member] | ||
Financing Receivable Recorded Investment Past Due [Line Items] | ||
Total Past Due | 1,593 | 1,458 |
Commercial [Member] | Current [Member] | ||
Financing Receivable Recorded Investment Past Due [Line Items] | ||
Total Past Due | 75,304 | 94,244 |
Real Estate Construction and Land [Member] | ||
Financing Receivable Recorded Investment Past Due [Line Items] | ||
PCI | 6,539 | 18,576 |
Total Loans | 55,140 | 79,331 |
Real Estate Construction and Land [Member] | 30-59 Days [Member] | ||
Financing Receivable Recorded Investment Past Due [Line Items] | ||
Total Past Due | 873 | |
Real Estate Construction and Land [Member] | 60-89 Days [Member] | ||
Financing Receivable Recorded Investment Past Due [Line Items] | ||
Total Past Due | 206 | 1,283 |
Real Estate Construction and Land [Member] | Past Due [Member] | ||
Financing Receivable Recorded Investment Past Due [Line Items] | ||
Total Past Due | 206 | 2,156 |
Real Estate Construction and Land [Member] | Current [Member] | ||
Financing Receivable Recorded Investment Past Due [Line Items] | ||
Total Past Due | 48,395 | 58,599 |
1-4 family residential mortgages [Member] | ||
Financing Receivable Recorded Investment Past Due [Line Items] | ||
PCI | 11,900 | 16,020 |
Total Loans | 329,920 | 358,148 |
1-4 family residential mortgages [Member] | 30-59 Days [Member] | ||
Financing Receivable Recorded Investment Past Due [Line Items] | ||
Total Past Due | 1,350 | 1,508 |
1-4 family residential mortgages [Member] | 60-89 Days [Member] | ||
Financing Receivable Recorded Investment Past Due [Line Items] | ||
Total Past Due | 100 | |
1-4 family residential mortgages [Member] | 90 Days or More [Member] | ||
Financing Receivable Recorded Investment Past Due [Line Items] | ||
Total Past Due | 495 | |
1-4 family residential mortgages [Member] | Past Due [Member] | ||
Financing Receivable Recorded Investment Past Due [Line Items] | ||
Total Past Due | 1,350 | 2,103 |
1-4 family residential mortgages [Member] | Current [Member] | ||
Financing Receivable Recorded Investment Past Due [Line Items] | ||
Total Past Due | 316,670 | 340,025 |
Commercial mortgages [Member] | ||
Financing Receivable Recorded Investment Past Due [Line Items] | ||
PCI | 24,694 | 28,675 |
Total Loans | 446,282 | 473,632 |
Commercial mortgages [Member] | 60-89 Days [Member] | ||
Financing Receivable Recorded Investment Past Due [Line Items] | ||
Total Past Due | 154 | |
Commercial mortgages [Member] | Past Due [Member] | ||
Financing Receivable Recorded Investment Past Due [Line Items] | ||
Total Past Due | 154 | |
Commercial mortgages [Member] | Current [Member] | ||
Financing Receivable Recorded Investment Past Due [Line Items] | ||
Total Past Due | 421,434 | 444,957 |
Consumer [Member] | ||
Financing Receivable Recorded Investment Past Due [Line Items] | ||
PCI | 91 | 118 |
Total Loans | 51,251 | 53,404 |
90 Days Past Due and Still Accruing | 30 | 83 |
Consumer [Member] | 30-59 Days [Member] | ||
Financing Receivable Recorded Investment Past Due [Line Items] | ||
Total Past Due | 207 | 345 |
Consumer [Member] | 60-89 Days [Member] | ||
Financing Receivable Recorded Investment Past Due [Line Items] | ||
Total Past Due | 102 | 196 |
Consumer [Member] | 90 Days or More [Member] | ||
Financing Receivable Recorded Investment Past Due [Line Items] | ||
Total Past Due | 30 | 83 |
Consumer [Member] | Past Due [Member] | ||
Financing Receivable Recorded Investment Past Due [Line Items] | ||
Total Past Due | 339 | 624 |
Consumer [Member] | Current [Member] | ||
Financing Receivable Recorded Investment Past Due [Line Items] | ||
Total Past Due | $ 50,821 | $ 52,662 |
Goodwill and Other Intangible_3
Goodwill and Other Intangible Assets (Narrative) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | Apr. 01, 2021 | ||
Goodwill and Intangible Assets Disclosure [Abstract] | |||||||
Goodwill | $ 8,140 | $ 8,140 | $ 8,140 | [1] | $ 7,768 | ||
Other intangible assets | 7,600 | $ 8,600 | 7,600 | $ 8,600 | $ 8,500 | ||
Amortization of intangible assets | $ 444 | $ 445 | $ 900 | $ 462 | |||
[1] Derived from audited Consolidated Financial Statements |
Goodwill and Other Intangible_4
Goodwill and Other Intangible Assets - Schedule of Gross Carrying Amounts and Accumulated Amortization of Other Intangible Assets (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Schedule Of Finite And Indefinite Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 10,433 | $ 10,433 |
Accumulated Amortization | (2,788) | (1,888) |
Core Deposit [Member] | ||
Schedule Of Finite And Indefinite Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 9,660 | 9,660 |
Accumulated Amortization | (2,255) | (1,389) |
Customer Relationships Intangible [Member] | ||
Schedule Of Finite And Indefinite Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 773 | 773 |
Accumulated Amortization | $ (533) | $ (499) |
Goodwill and Other Intangible_5
Goodwill and Other Intangible Assets - Schedule of Estimated Future Amortization Expense (Details) $ in Thousands | Jun. 30, 2022 USD ($) |
Core Deposit Intangible [Member] | |
Schedule of Estimated Future Amortization Expense [Line Items] | |
For the six months ending December 31, 2022 | $ 819 |
For the year ending December 31, 2023 | 1,493 |
For the year ending December 31, 2024 | 1,301 |
For the year ending December 31, 2025 | 1,110 |
For the year ending December 31, 2026 | 918 |
Thereafter | 1,764 |
Finite-Lived Intangible Assets, Net, Total | 7,405 |
Customer Relationships Intangible [Member] | |
Schedule of Estimated Future Amortization Expense [Line Items] | |
For the six months ending December 31, 2022 | 33 |
For the year ending December 31, 2023 | 67 |
For the year ending December 31, 2024 | 67 |
For the year ending December 31, 2025 | 67 |
For the year ending December 31, 2026 | 6 |
Finite-Lived Intangible Assets, Net, Total | $ 240 |
Leases (Narrative) (Details)
Leases (Narrative) (Details) | 6 Months Ended |
Jun. 30, 2022 | |
Leases [Abstract] | |
Lessee, operating lease, existence of option to extend | true |
Lease term | 12 months |
Leases (Schedule of Lease Liabi
Leases (Schedule of Lease Liability, Right-of-use Asset, Weighted Average Remaining Lease Term and Discount Rate) (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 | [1] | Jun. 30, 2021 |
Leases [Abstract] | ||||
Lease liability | $ 6,925 | $ 7,833 | ||
Operating Lease, Liability, Statement of Financial Position [Extensible Enumeration] | us-gaap:OtherLiabilities | us-gaap:OtherLiabilities | ||
Right-of-use asset | $ 7,343 | $ 7,583 | $ 8,371 | |
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible Enumeration] | Other Assets | Other Assets | ||
Weighted average remaining lease term | 5 years 10 months 2 days | 6 years 4 months 13 days | ||
Weighted average discount rate | 1.97% | 1.98% | ||
[1] Derived from audited Consolidated Financial Statements |
Leases (Schedule of Operating L
Leases (Schedule of Operating Lease Expense) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Leases [Abstract] | ||||
Operating lease expense | $ 449 | $ 427 | $ 894 | $ 649 |
Short-term lease expense | 139 | 32 | 191 | 61 |
Total lease expense | 588 | 459 | 1,085 | 710 |
Cash paid for amounts included in lease liabilities | $ 418 | $ 389 | $ 832 | $ 608 |
Leases (Schedule of Operating_2
Leases (Schedule of Operating Lease Liabilities and Reconciliation of Undiscounted Cash Flows) (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Jun. 30, 2021 |
Commitments and Contingencies Disclosure [Abstract] | ||
Six months ending December 31, 2022 | $ 817 | |
Twelve months ending December 31, 2023 | 1,567 | |
Twelve months ending December 31, 2024 | 1,296 | |
Twelve months ending December 31, 2025 | 1,091 | |
Twelve months ending December 31, 2026 | 748 | |
Twelve months ending December 31, 2027 | 650 | |
Thereafter | 1,141 | |
Total undiscounted cash flows | 7,310 | |
Less: Discount | (385) | |
Lease liability | $ 6,925 | $ 7,833 |
Net Income Per Share (Schedule
Net Income Per Share (Schedule of Weighted Average Number of Shares) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2022 | Mar. 31, 2022 | Jun. 30, 2021 | Mar. 31, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Basic net income per share | ||||||
Net Income | $ 5,685 | $ 4,924 | $ 147 | $ 1,505 | $ 10,609 | $ 1,652 |
Basic, Weighted Average Shares | 5,326,271 | 5,305,277 | 5,319,166 | 4,019,700 | ||
Basic, Per Share Amount | $ 1.07 | $ 0.03 | $ 1.99 | $ 0.41 | ||
Effect of dilutive stock options, Weighted Average Shares | 20,737 | 15,013 | 26,076 | 11,601 | ||
Effect of dilutive stock options, Per Share Amount | $ (0.01) | $ (0.01) | ||||
Diluted net income per share | ||||||
Net Income | $ 5,685 | $ 4,924 | $ 147 | $ 1,505 | $ 10,609 | $ 1,652 |
Diluted, Weighted Average Shares | 5,347,008 | 5,320,290 | 5,345,242 | 4,031,301 | ||
Diluted, Per Share Amount | $ 1.06 | $ 0.03 | $ 1.98 | $ 0.41 |
Net Income Per Share (Narrative
Net Income Per Share (Narrative) (Details) - shares | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Equity Option [Member] | ||||
Earnings Per Share [Line Items] | ||||
Securities considered to be anti-dilutive and excluded from earnings per share calculation | 101,901 | 78,301 | 101,901 | 78,301 |
Stock Incentive Plans (Plan dur
Stock Incentive Plans (Plan duration - Narrative) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | Jun. 23, 2022 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Stock grant expense | $ 121 | $ 214 | $ 226 | |||
Employee Stock Option [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Compensation expense | 42 | $ 31 | 83 | $ 65 | ||
Unrecognized compensation expense related to the non-vested awards | $ 304 | $ 304 | ||||
Unrecognized compensation expense related to the non-vested awards, final year of recognition | 2026 | |||||
Option Issued | 0 | 0 | 0 | 0 | ||
Restricted Stock [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Unrecognized compensation expense related to the non-vested awards | $ 1,300 | $ 1,300 | ||||
Unrecognized compensation expense related to the non-vested awards, final year of recognition | 2026 | |||||
Stock grants awarded | 18,536 | |||||
Restricted Stock [Member] | Employees and Non-employee Directors [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting period | 4 years | |||||
Restricted Stock [Member] | Employees [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Stock grants awarded | 5,730 | 5,580 | 19,233 | |||
Restricted Stock [Member] | Non-employee Directors [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Stock grants awarded | 12,856 | |||||
Unrestricted Stock [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Stock grants awarded | 0 | 0 | ||||
Unrestricted Stock [Member] | Employees [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Stock grants awarded | 100 | |||||
Unrestricted stock grant expense | $ 3 | |||||
Maximum [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Plan duration | 10 years | |||||
2022 Stock Plan [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Common stock authorized for issuance | 150,000 | 150,000 | 150,000 | |||
Common stock available for grant | 150,000 | 150,000 | ||||
Number of grants issued | 0 | |||||
Percentage of common stock authorized for issuance | 95% | |||||
2014 Stock Plan [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Common stock authorized for issuance | 275,625 | 275,625 | 275,625 | |||
Common stock available for grant | 28,031 | 28,031 | ||||
Number of grants issued | 170,106 | |||||
2005 Stock Plan [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Common stock authorized for issuance | 253,575 | 253,575 | ||||
Common stock available for grant | 0 | 0 | 0 | |||
Number of grants issued | 59,870 |
Stock Incentive Plans (Summary
Stock Incentive Plans (Summary of Shares Issued and Available Under Each Plans) (Details) - $ / shares | 6 Months Ended | |
Jun. 30, 2022 | Jun. 23, 2022 | |
2022 Stock Plan [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Aggregate shares issuable | 150,000 | 150,000 |
Options issued, net of forfeited and expired options | 0 | |
Remaining available for grant | 150,000 | |
2014 Stock Plan [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Aggregate shares issuable | 275,625 | 275,625 |
Options issued, net of forfeited and expired options | (170,106) | |
Cancelled due to Plan expiration | 0 | |
Remaining available for grant | 28,031 | |
Total vested and unvested shares | 77,488 | |
Fully vested shares | 31,764 | |
2014 Stock Plan [Member] | Unrestricted Stock [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock grants issued | (11,635) | |
2014 Stock Plan [Member] | Restricted Stock [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock grants issued | (65,853) | |
2014 Stock Plan [Member] | Employee Stock Option [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Total vested and unvested shares | 167,901 | |
Fully vested shares | 76,148 | |
2014 Stock Plan [Member] | Minimum [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Exercise price range | $ 23.75 | |
2014 Stock Plan [Member] | Maximum [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Exercise price range | $ 42.62 | |
2005 Stock Plan [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Aggregate shares issuable | 253,575 | |
Options issued, net of forfeited and expired options | (59,870) | |
Cancelled due to Plan expiration | (193,705) | |
Remaining available for grant | 0 | 0 |
Exercise price range | $ 13.69 | |
2005 Stock Plan [Member] | Employee Stock Option [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Total vested and unvested shares | 1,379 | |
Fully vested shares | 1,379 |
Stock Incentive Plans (Changes
Stock Incentive Plans (Changes in the Stock Options Outstanding) (Details) - Employee Stock Option [Member] - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | |
Number of Options | |||||
Outstanding, at the beginning | 169,280 | ||||
Issued | 0 | 0 | 0 | 0 | |
Exercised | |||||
Outstanding, at the end | 169,280 | 169,280 | |||
Options Exercisable | 77,527 | 77,527 | |||
Weighted Average Exercise Price | |||||
Outstanding, at the beginning | $ 33.89 | ||||
Issued | |||||
Exercised | |||||
Outstanding, at the end | $ 33.89 | 33.89 | |||
Exercisable | $ 37.31 | $ 37.31 | |||
Aggregate Intrinsic Value | |||||
Outstanding, Aggregate Intrinsic Value | $ 477 | $ 477 | $ 962 | ||
Exercisable | $ 144 | $ 144 |
Stock Incentive Plans (Summar_2
Stock Incentive Plans (Summary Information Pertaining to Options Outstanding) (Details) | 6 Months Ended |
Jun. 30, 2022 $ / shares shares | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Options Outstanding | shares | 169,280 |
Weighted-Average Remaining Contractual Life | 7 years 3 months 18 days |
Weighted Average Exercise Price | $ 33.89 |
Options Exercisable | shares | 77,527 |
Weighted-Average Exercise Price | $ 37.31 |
$13.69 to 20.00 [Member] | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Exercise Price, Minimum | 13.69 |
Exercise Price, Maximum | $ 20 |
Options Outstanding | shares | 1,379 |
Weighted-Average Remaining Contractual Life | 7 months 6 days |
Weighted Average Exercise Price | $ 13.69 |
Options Exercisable | shares | 1,379 |
Weighted-Average Exercise Price | $ 13.69 |
$20.01 to $30.00 [Member] | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Exercise Price, Minimum | 20.01 |
Exercise Price, Maximum | $ 30 |
Options Outstanding | shares | 66,000 |
Weighted-Average Remaining Contractual Life | 8 years |
Weighted Average Exercise Price | $ 24.64 |
Options Exercisable | shares | 18,400 |
Weighted-Average Exercise Price | $ 25.02 |
$30.01 to 40.00 [Member] | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Exercise Price, Minimum | 30.01 |
Exercise Price, Maximum | $ 40 |
Options Outstanding | shares | 44,420 |
Weighted-Average Remaining Contractual Life | 8 years 1 month 6 days |
Weighted Average Exercise Price | $ 36.97 |
Options Exercisable | shares | 11,772 |
Weighted-Average Exercise Price | $ 38.52 |
$40.01 to 42.62 [Member] | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Exercise Price, Minimum | 40.01 |
Exercise Price, Maximum | $ 42.62 |
Options Outstanding | shares | 57,481 |
Weighted-Average Remaining Contractual Life | 5 years 10 months 24 days |
Weighted Average Exercise Price | $ 42.62 |
Options Exercisable | shares | 45,976 |
Weighted-Average Exercise Price | $ 42.62 |
Stock Incentive Plans (Change_2
Stock Incentive Plans (Changes in the Restricted Stock Grants Outstanding) (Details) - Restricted Stock [Member] $ / shares in Units, $ in Thousands | 6 Months Ended |
Jun. 30, 2022 USD ($) $ / shares shares | |
Number of Shares/Options | |
Non-vested Outstanding, at the beginning | shares | 37,011 |
Issued | shares | 18,536 |
Vested | shares | (9,223) |
Forfeited | shares | (600) |
Non-vested Outstanding, at the end | shares | 45,724 |
Weighted Average Grant Date Fair Value Per Share/Exercise Price | |
Non-vested Outstanding, at the beginning | $ / shares | $ 28.98 |
Issued | $ / shares | 35.62 |
Vested | $ / shares | (27.38) |
Forfeited | $ / shares | (33.74) |
Non-vested Outstanding, at the end | $ / shares | $ 31.94 |
Aggregate Intrinsic Value | |
Non-vested Outstanding, at the beginning | $ | $ 1,165 |
Issued | $ | 584 |
Vested | $ | (290) |
Forfeited | $ | (19) |
Non-vested Outstanding, Aggregate Intrinsic Value | $ | $ 1,440 |
Fair Value Measurements (Assets
Fair Value Measurements (Assets Measured at Fair Value on Recurring Basis) (Details) - Fair Value, Recurring [Member] - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total securities available for sale | $ 461,830 | $ 303,817 |
Assets measured at fair value | 462,140 | |
Liabilities measured at fair value | 197 | |
Interest Rate Swap [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets measured at fair value | 310 | |
Liabilities measured at fair value | 197 | |
U.S. Government Treasuries [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total securities available for sale | 161,009 | |
U.S. Government agencies [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total securities available for sale | 30,532 | 31,581 |
Mortgage-backed securities/CMOs [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total securities available for sale | 175,962 | 170,964 |
Corporate bonds [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total securities available for sale | 11,154 | |
Municipal bonds [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total securities available for sale | 83,173 | 101,272 |
Significant Other Observable Inputs (Level 2) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total securities available for sale | 461,830 | 303,817 |
Assets measured at fair value | 462,140 | |
Liabilities measured at fair value | 197 | |
Significant Other Observable Inputs (Level 2) [Member] | Interest Rate Swap [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets measured at fair value | 310 | |
Liabilities measured at fair value | 197 | |
Significant Other Observable Inputs (Level 2) [Member] | U.S. Government Treasuries [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total securities available for sale | 161,009 | |
Significant Other Observable Inputs (Level 2) [Member] | U.S. Government agencies [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total securities available for sale | 30,532 | 31,581 |
Significant Other Observable Inputs (Level 2) [Member] | Mortgage-backed securities/CMOs [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total securities available for sale | 175,962 | 170,964 |
Significant Other Observable Inputs (Level 2) [Member] | Corporate bonds [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total securities available for sale | 11,154 | |
Significant Other Observable Inputs (Level 2) [Member] | Municipal bonds [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total securities available for sale | $ 83,173 | $ 101,272 |
Fair Value Measurements (Narrat
Fair Value Measurements (Narrative) (Details) $ in Thousands | Jun. 30, 2022 USD ($) | Dec. 31, 2021 USD ($) Property | Apr. 01, 2021 USD ($) | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Recorded Investment, total | $ 1,439 | $ 1,529 | ||
Other real estate owned, net | 0 | $ 611 | [1] | |
Fair Value, Nonrecurring [Member] | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | 0 | |||
Fair Value, Nonrecurring [Member] | Significant Unobservable Inputs (Level 3) [Member] | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Assets measured at fair value | $ 0 | |||
Fauquier Bankshares, Inc [Member] | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Number of other real estate owned properties | Property | 1 | |||
Estimated fair value of loan | $ 611 | $ 602,600 | ||
[1] Derived from audited Consolidated Financial Statements |
Fair Value Measurements (Asse_2
Fair Value Measurements (Assets Measured at Fair Value on a Nonrecurring Basis ) (Details) - Fair Value, Nonrecurring [Member] - USD ($) | Jun. 30, 2022 | Dec. 31, 2021 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets measured at fair value | $ 0 | |
Significant Unobservable Inputs (Level 3) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets measured at fair value | $ 0 | |
Other Real Estate Owned [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets measured at fair value | $ 611,000 | |
Other Real Estate Owned [Member] | Significant Unobservable Inputs (Level 3) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets measured at fair value | $ 61,100 |
Fair Value Measurements (Quanti
Fair Value Measurements (Quantitative Information About Level 3 Fair Value Measurements) (Details) - Market Comparables [Member] - Other Real Estate Owned [Member] - Fair Value, Nonrecurring [Member] - Significant Unobservable Inputs (Level 3) [Member] $ in Thousands | 12 Months Ended |
Dec. 31, 2021 USD ($) | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Fair Value | $ 611 |
Unobservable Inputs | Discount applied to bonafide offer |
Weighted Average | 0.060 |
Fair Value Measurements (Carryi
Fair Value Measurements (Carrying Values and Estimated Fair Values of Financial Instruments) (Details) - Fair Value, Nonrecurring [Member] - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Carrying Value [Member] | ||
Assets | ||
Cash and cash equivalent | $ 215,667 | $ 508,840 |
Available for sale securities | 461,830 | 303,817 |
Loans, net | 954,689 | 1,055,227 |
Bank owned life insurance | 38,046 | 31,234 |
Other real estate owned, net | 611 | |
Accrued interest receivable | 4,229 | 3,778 |
Interest rate Swaps asset | 310 | |
Liabilities | ||
Demand deposits and interest-bearing transaction, money market, and savings accounts | 1,448,777 | 1,634,125 |
Certificates of deposit | 150,121 | 162,045 |
Junior subordinated debt, net | 3,390 | 3,367 |
Accrued interest payable | 134 | 174 |
Interest rate swap liabilities | 197 | |
Fair Value [Member] | ||
Assets | ||
Cash and cash equivalent | 215,667 | 508,840 |
Available for sale securities | 461,830 | 303,817 |
Loans, net | 929,045 | 1,059,650 |
Bank owned life insurance | 38,046 | 31,234 |
Other real estate owned, net | 611 | |
Accrued interest receivable | 4,229 | 3,778 |
Interest rate Swaps asset | 310 | |
Liabilities | ||
Demand deposits and interest-bearing transaction, money market, and savings accounts | 1,448,777 | 1,634,125 |
Certificates of deposit | 144,556 | 161,850 |
Junior subordinated debt, net | 3,459 | 3,367 |
Accrued interest payable | 134 | 174 |
Interest rate swap liabilities | 197 | |
Fair Value [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | ||
Assets | ||
Cash and cash equivalent | 215,667 | 508,840 |
Fair Value [Member] | Significant Other Observable Inputs (Level 2) [Member] | ||
Assets | ||
Available for sale securities | 461,830 | 303,817 |
Bank owned life insurance | 38,046 | 31,234 |
Accrued interest receivable | 2,055 | 1,252 |
Interest rate Swaps asset | 310 | |
Liabilities | ||
Demand deposits and interest-bearing transaction, money market, and savings accounts | 1,448,777 | 1,634,125 |
Certificates of deposit | 144,556 | 161,850 |
Junior subordinated debt, net | 3,459 | 3,367 |
Accrued interest payable | 134 | 174 |
Interest rate swap liabilities | 197 | |
Fair Value [Member] | Significant Unobservable Inputs (Level 3) [Member] | ||
Assets | ||
Loans, net | 929,045 | 1,059,650 |
Other real estate owned, net | 611 | |
Accrued interest receivable | $ 2,174 | $ 2,526 |
Other Comprehensive Income (L_3
Other Comprehensive Income (Loss) (Narrative) (Details) - USD ($) | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | |
Other Comprehensive Income (Loss), Tax [Abstract] | |||||
Sales of securities | $ 0 | $ 0 | $ 0 | $ 0 | |
Accumulated other comprehensive income (loss), net of deferred taxes | $ (7,900,000) | $ (464,000) |
Other Comprehensive Income - Sc
Other Comprehensive Income - Schedule of Cumulative Balances of the Components of Accumulated Other Comprehensive Income (Loss), Net of Deferred Taxes (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |||
Accumulated other comprehensive loss on securities | $ (38,026) | $ (2,164) | |
Accumulated other comprehensive income (loss) on interest rate swap | 331 | (47) | |
Total accumulated other comprehensive loss | $ (37,695) | $ (2,211) | [1] |
[1] Derived from audited Consolidated Financial Statements |
Derivative Instruments and Hedg
Derivative Instruments and Hedging Activities (Narrative) (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||
Cash collateral held at other banks | $ 570 | $ 570 |
Derivative Instruments and He_2
Derivative Instruments and Hedging Activities - (Summary of Derivative Instruments) (Details) - Derivatives Designated as Hedging Instruments [Member] - Other Liabilities [Member] - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Interest Rate Forward Swap - Cash Flow [Member] | ||
Derivative [Line Items] | ||
Notional/contract amount | $ 4,000 | $ 4,000 |
Fair value | $ 310 | $ (197) |
Expiration Date | Jun. 15, 2031 | Jun. 15, 2031 |
Interest Rate Swap - Fair Value [Member] | ||
Derivative [Line Items] | ||
Notional/contract amount | $ 3,940 | |
Fair value | $ (8) | |
Expiration Date | Feb. 12, 2022 |
Segment Reporting (Narrative) (
Segment Reporting (Narrative) (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 USD ($) | Jun. 30, 2021 USD ($) | Jun. 30, 2022 USD ($) Item | Jun. 30, 2021 USD ($) | |
Segment Reporting Information [Line Items] | ||||
Number of reportable segments | Item | 4 | |||
VNB Wealth [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Management fees | $ | $ 25 | $ 25 | $ 50 | $ 50 |
Segment Reporting (Schedule of
Segment Reporting (Schedule of Segment Reporting Information) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||||
Jun. 30, 2022 | Mar. 31, 2022 | Jun. 30, 2021 | Mar. 31, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | |
Segment Reporting Information [Line Items] | |||||||
Net interest income | $ 12,461 | $ 13,151 | $ 23,886 | $ 19,125 | |||
Provision for (recovery of) loan losses | (217) | (141) | (69) | 210 | $ 1,014 | ||
Noninterest income | 3,646 | 2,920 | 8,433 | 3,959 | |||
Noninterest expense | 9,442 | 15,993 | 19,537 | 20,774 | |||
Income (loss) before income taxes | 6,882 | 219 | 12,851 | 2,100 | |||
Provision for (benefit from) income taxes | 1,197 | 72 | 2,242 | 448 | |||
Net income (loss) | 5,685 | $ 4,924 | 147 | $ 1,505 | 10,609 | 1,652 | |
Bank [Member] | |||||||
Segment Reporting Information [Line Items] | |||||||
Net interest income | 12,461 | 13,151 | 23,886 | 19,125 | |||
Provision for (recovery of) loan losses | (217) | (141) | (69) | 210 | |||
Noninterest income | 2,851 | 2,356 | 4,385 | 2,870 | |||
Noninterest expense | 8,717 | 15,416 | 17,538 | 19,671 | |||
Income (loss) before income taxes | 6,812 | 232 | 10,802 | 2,114 | |||
Provision for (benefit from) income taxes | 1,181 | 75 | 1,811 | 451 | |||
Net income (loss) | 5,631 | 157 | 8,991 | 1,663 | |||
Sturman Wealth Advisors [Member] | |||||||
Segment Reporting Information [Line Items] | |||||||
Noninterest income | 210 | 202 | 426 | 393 | |||
Noninterest expense | 161 | 167 | 327 | 327 | |||
Income (loss) before income taxes | 49 | 35 | 99 | 66 | |||
Provision for (benefit from) income taxes | 11 | 7 | 21 | 14 | |||
Net income (loss) | 38 | 28 | 78 | 52 | |||
VNB Trust & Estate Services [Member] | |||||||
Segment Reporting Information [Line Items] | |||||||
Noninterest income | 365 | 203 | 3,196 | 404 | |||
Noninterest expense | 376 | 215 | 1,298 | 421 | |||
Income (loss) before income taxes | (11) | (12) | 1,898 | (17) | |||
Provision for (benefit from) income taxes | (2) | (3) | 399 | (4) | |||
Net income (loss) | (9) | (9) | 1,499 | (13) | |||
Masonry Capital [Member] | |||||||
Segment Reporting Information [Line Items] | |||||||
Noninterest income | 220 | 159 | 426 | 292 | |||
Noninterest expense | 188 | 195 | 374 | 355 | |||
Income (loss) before income taxes | 32 | (36) | 52 | (63) | |||
Provision for (benefit from) income taxes | 7 | (7) | 11 | (13) | |||
Net income (loss) | $ 25 | $ (29) | $ 41 | $ (50) |