Loans, Notes, Trade and Other Receivables Disclosure [Text Block] | INVESTAR HOLDING CORPORATION NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) 4. The Company’s loan portfolio consists of the following categories of loans as of the dates presented (dollars in thousands). March 31, 2023 December 31, 2022 Construction and development $ 210,274 $ 201,633 1-4 Family 401,329 401,377 Multifamily 80,980 81,812 Farmland 10,731 12,877 Commercial real estate 967,157 958,243 Total mortgage loans on real estate 1,670,471 1,655,942 Commercial and industrial 425,093 435,093 Consumer 13,480 13,732 Total loans $ 2,109,044 $ 2,104,767 Interest on loans is calculated by using the simple interest method on daily balances of the principal amount outstanding. Loan origination fees, net of direct loan origination costs and commitment fees, are deferred and amortized as an adjustment to yield over the life of the loan, or over the commitment period, as applicable. Unamortized premiums and discounts on loans, included in the total loans balances above, were $0.3 million at March 31, 2023 and December 31, 2022 , respectively, and unearned income, or deferred fees, on loans w $1.2 million March 31, 2023 December 31, 2022 INVESTAR HOLDING CORPORATION NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) The table below provides an analysis of the aging of loans as of March 31, 2023 March 31, 2023 Current 30 - 59 Days Past Due 60 - 89 Days Past Due 90 Days or More Past Due Total > 90 Days and Accruing Construction and development $ 210,033 $ 8 $ — $ 233 $ 210,274 $ 113 1-4 Family 397,211 2,423 1,075 620 401,329 — Multifamily 80,980 — — — 80,980 — Farmland 10,692 — — 39 10,731 — Commercial real estate 965,383 1,254 — 520 967,157 — Total mortgage loans on real estate 1,664,299 3,685 1,075 1,412 1,670,471 113 Commercial and industrial 423,225 1,093 40 735 425,093 11 Consumer 13,222 71 98 89 13,480 — Total loans $ 2,100,746 $ 4,849 $ 1,213 $ 2,236 $ 2,109,044 $ 124 The table below provides an analysis of nonaccrual loans as of March 31, 2023 December 31, 2022 March 31, 2023 December 31, 2022 (1) Nonaccrual With No Allowance for Credit Loss Nonaccrual with an Allowance for Credit Loss Total Nonaccrual Loans Total Nonaccrual Loans Construction and development $ 121 $ — $ 121 $ 372 1-4 Family 1,603 41 1,644 1,207 Multifamily — — — — Farmland 39 — 39 62 Commercial real estate 1,897 242 2,139 6,032 Total mortgage loans on real estate 3,660 283 3,943 7,673 Commercial and industrial 1,458 59 1,517 2,183 Consumer 43 73 116 130 Total loans $ 5,161 $ 415 $ 5,576 $ 9,986 ( 1 Nonaccrual loans previously reported as of December 31, 2022 310 30. The table below provides an analysis of the aging of loans as of December 31, 2022 December 31, 2022 Accruing Current 30-59 Days Past Due 60-89 Days Past Due 90 Days or More Past Due Nonaccrual Total Past Due & Nonaccrual Acquired Impaired Loans Total Loans Construction and development $ 201,048 $ 101 $ — $ 112 $ 372 $ 585 $ — $ 201,633 1-4 Family 394,846 2,614 1,220 1,188 1,207 6,229 302 401,377 Multifamily 81,812 — — — — — — 81,812 Farmland 12,601 152 62 — 62 276 — 12,877 Commercial real estate 951,908 181 22 — 5,523 5,726 609 958,243 Total mortgage loans on real estate 1,642,215 3,048 1,304 1,300 7,164 12,816 911 1,655,942 Commercial and industrial 432,438 406 15 51 2,183 2,655 — 435,093 Consumer 13,347 171 27 — 130 328 57 13,732 Total loans $ 2,088,000 $ 3,625 $ 1,346 $ 1,351 $ 9,477 $ 15,799 $ 968 $ 2,104,767 Nonaccrual and Past Due Loans Loans are considered past due if the required principal and interest payments have not may not may 90 not may not may six Collateral Dependent Loans Collateral dependent loans are loans for which the repayments, on the basis of our assessment at the reporting date, are expected to be provided substantially through the operation or sale of the collateral and the borrower was experiencing financial difficulty. Loans that do not s collateral dependent loans include all nonaccrual loans shown in the table above. The types of collateral that secure collateral dependent loans are discussed under “Portfolio Segment Risk Factors” below. INVESTAR HOLDING CORPORATION NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) Portfolio Segment Risk Factors The following describes the risk characteristics relevant to each of the Company’s loan portfolio segments. Constructio n and Development - Construction and development loans are generally made for the purpose of acquisition and development of land to be improved through the construction of commercial and residential buildings. The successful repayment of these types of loans is generally dependent upon a commitment for permanent financing from the Company, or from the sale of the constructed property. These loans carry more risk than commercial or residential real estate loans due to the dynamics of construction projects, changes in interest rates, the long-term financing market, and state and local government regulations. One such risk is that loan funds are advanced upon the security of the property under construction, which is of uncertain value prior to the completion of construction. Thus, it is more difficult to evaluate accurately the total loan funds required to complete a project and to calculate related loan-to-value ratios. The Company attempts to minimize the risks associated with construction lending by limiting loan-to-value ratios as described above. In addition, as to speculative development loans, the Company generally makes such loans only to borrowers that have a positive pre-existing relationship with us. The Company manages risk by using specific underwriting policies and procedures for these types of loans and by avoiding excessive concentrations in any one 1 4 - The 1 4 first not Multifamily - Multifamily loans are normally made to real estate investors to support permanent financing for multifamily residential income producing properties that rely on the successful operation of the property for repayment. This management mainly involves property maintenance and collection of rents due from tenants. This type of lending carries a lower level of risk, as compared to other commercial lending. In addition, underwriting requirements for multifamily properties are stricter than for other non-owner-occupied property types. The Company manages this risk by avoiding concentrations with any particular customer. Multifamily loans are primarily secured by first Farmland - Farmland loans are often for land improvements related to agricultural endeavors and may Commercial Real Estate - Commercial real estate loans are extensions of credit secured by owner occupied and non-owner occupied collateral. Underwriting generally involves intensive analysis of the financial strength of the borrower and guarantor, liquidation value of the subject collateral, the associated unguaranteed exposure, and any available secondary sources of repayment, with the greatest emphasis given to a borrower’s capacity to meet cash flow coverage requirements as set forth by Bank policies. Commercial real estate loans typically depend on the successful operation and management of the businesses that occupy these properties or the financial stability of tenants occupying the properties. Nonowner-occupied commercial real estate loans typically are dependent, in large part, on the owner’s ability to rent the property and the ability of the tenants to pay rent, whereas owner-occupied commercial real estate loans typically are dependent, in large part, on the success of the owner’s business. General market conditions and economic activity may one INVESTAR HOLDING CORPORATION NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) Com mercial and Industrial - Commercial and industrial loans receive similar underwriting treatment as commercial real estate loans in that the repayment source is analyzed to determine its ability to meet cash flow coverage requirements as set forth by Bank policies. Repayment of these loans generally comes from the generation of cash flow as the result of the borrower’s business operations. Commercial lending generally involves different risks from those associated with commercial real estate lending or construction lending. Although commercial loans may may, Consumer - Consumer loans are offered by the Company in order to provide a full range of retail financial services to its customers and include auto loans, credit cards, and other consumer installment loans. Typically, the Company evaluates the borrower’s repayment ability through a review of credit scores and an evaluation of debt to income ratios. Repayment of consumer loans depends upon key consumer economic measures and upon the borrower’s financial stability, and is more likely to be adversely affected by divorce, job loss, illness and personal hardships than repayment of other loans. A shortfall in the value of any collateral also may Refer to Note 1. 2023 Credit Quality Indicators Loans are categorized into risk categories based on relevant information about the ability of borrowers to service their debt, such as current financial information, historical payment experience, credit documentation, public information, and current economic trends, among other factors. The following definitions are utilized for risk ratings, which are consistent with the definitions used in supervisory guidance: Pass not Special Mention may Substandard not Doubtful Loss not not no not INVESTAR HOLDING CORPORATION NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) The table below presents the Company’s loan portfolio by year of origination, category, and credit quality indicator as of March 31, 2023 March 31, 2023 2023 2022 2021 2020 2019 Prior Revolving Loans Revolving Loans Converted to Term Loans Total Construction and development Pass $ 4,092 $ 8,133 $ 11,737 $ 4,666 $ 1,483 $ 5,732 $ 168,694 $ 3,139 $ 207,676 Special Mention — — 787 — — — — — 787 Substandard — 142 142 — — 77 1,450 — 1,811 Total construction and development $ 4,092 $ 8,275 $ 12,666 $ 4,666 $ 1,483 $ 5,809 $ 170,144 $ 3,139 $ 210,274 Current-period gross charge-offs $ — $ — $ — $ — $ — $ — $ — $ — $ — 1-4 Family residential Pass $ 14,591 $ 99,639 $ 81,460 $ 63,823 $ 30,213 $ 69,465 $ 36,456 $ 1,259 $ 396,906 Special Mention — — 497 — — 562 — — 1,059 Substandard — 292 168 — 408 2,405 91 — 3,364 Total 1-4 family residential $ 14,591 $ 99,931 $ 82,125 $ 63,823 $ 30,621 $ 72,432 $ 36,547 $ 1,259 $ 401,329 Current-period gross charge-offs $ (22 ) $ — $ — $ — $ (20 ) $ — $ — $ — $ (42 ) Multifamily Pass $ 1,398 $ 45,056 $ 13,259 $ 4,529 $ 640 $ 10,445 $ 4,923 $ 730 $ 80,980 Special Mention — — — — — — — — — Substandard — — — — — — — — — Total multifamily $ 1,398 $ 45,056 $ 13,259 $ 4,529 $ 640 $ 10,445 $ 4,923 $ 730 $ 80,980 Current-period gross charge-offs $ — $ — $ — $ — $ — $ — $ — $ — $ — Farmland Pass $ 958 $ 1,486 $ 759 $ 1,135 $ 1,202 $ 3,773 $ 1,379 $ — $ 10,692 Special Mention — — — — — — — — — Substandard — — — — — 39 — — 39 Total farmland $ 958 $ 1,486 $ 759 $ 1,135 $ 1,202 $ 3,812 $ 1,379 $ — $ 10,731 Current-period gross charge-offs $ — $ — $ — $ — $ — $ — $ — $ — $ — Commercial real estate Pass $ 36,634 $ 244,524 $ 217,923 $ 186,943 $ 90,029 $ 133,844 $ 21,283 $ 27,749 $ 958,929 Special Mention — — 185 — — — — — 185 Substandard — — (22 ) 1,148 469 5,641 807 — 8,043 Total commercial real estate $ 36,634 $ 244,524 $ 218,086 $ 188,091 $ 90,498 $ 139,485 $ 22,090 $ 27,749 $ 967,157 Current-period gross charge-offs $ — $ — $ — $ — $ — $ — $ — $ — $ — Commercial & industrial Pass $ 11,879 $ 165,148 $ 40,688 $ 17,940 $ 9,591 $ 17,165 $ 154,769 $ 1,412 $ 418,592 Special Mention — — — — — — 4,680 — 4,680 Substandard — 91 — 250 1,176 123 181 — 1,821 Total commercial and industrial $ 11,879 $ 165,239 $ 40,688 $ 18,190 $ 10,767 $ 17,288 $ 159,630 $ 1,412 $ 425,093 Current-period gross charge-offs $ — $ — $ (190 ) $ — $ — $ — $ (190 ) $ — $ (380 ) Consumer Pass $ 2,193 $ 4,249 $ 2,366 $ 1,301 $ 550 $ 1,771 $ 881 $ — $ 13,311 Special Mention — — — — — — — — — Substandard — 11 3 31 9 115 — — 169 Total consumer $ 2,193 $ 4,260 $ 2,369 $ 1,332 $ 559 $ 1,886 $ 881 $ — $ 13,480 Current-period gross charge-offs $ (36 ) $ (7 ) $ (8 ) $ (1 ) $ (5 ) $ (25 ) $ (6 ) $ — $ (88 ) Total loans Pass $ 71,745 $ 568,235 $ 368,192 $ 280,337 $ 133,708 $ 242,195 $ 388,385 $ 34,289 $ 2,087,086 Special Mention — — 1,469 — — 562 4,680 — 6,711 Substandard — 536 291 1,429 2,062 8,400 2,529 — 15,247 Total loans $ 71,745 $ 568,771 $ 369,952 $ 281,766 $ 135,770 $ 251,157 $ 395,594 $ 34,289 $ 2,109,044 Current-period gross charge-offs $ (58 ) $ (7 ) $ (198 ) $ (1 ) $ (25 ) $ (25 ) $ (196 ) $ — $ (510 ) The table below presents the Company’s loan portfolio by category and credit quality indicator as of December 31, 2022 December 31, 2022 Special Pass Mention Substandard Doubtful Total Construction and development $ 198,967 $ 1,593 $ 1,073 $ — $ 201,633 1-4 Family 399,143 — 2,234 — 401,377 Multifamily 81,812 — — — 81,812 Farmland 12,815 — 62 — 12,877 Commercial real estate 942,927 6,101 9,215 — 958,243 Total mortgage loans on real estate 1,635,664 7,694 12,584 — 1,655,942 Commercial and industrial 427,430 5,140 2,336 187 435,093 Consumer 13,636 — 96 — 13,732 Total loans $ 2,076,730 $ 12,834 $ 15,016 $ 187 $ 2,104,767 The Company had no loans that were classified as doubtful or loss at March 31, 2023 no December 31, 2022 INVESTAR HOLDING CORPORATION NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) Loan Participations and Sold Loans Loan participations and whole loans sold to and serviced for others are not $19.7 million t March 31, 2023 and December 31, 2022 , respectively. The unpaid principal balance of these loans was approximat $99.9 million at March 31, 2023 and December 31, 2022 , respectively. Loans to Related Parties In the ordinary course of business, the Company makes loans to related parties including its executive officers, principal stockholders, directors and their immediate family members, as well as to companies of which these individuals are principal owners. Loans outstanding to such related party borrowers amounted to approximately $63.4 million and $97.0 million as of March 31, 2023 December 31, 2022 The table below shows the aggregate principal balance of loans to such related parties as of the dates presented (dollars in thousands). March 31, 2023 December 31, 2022 Balance, beginning of period $ 96,977 $ 97,606 New loans/changes in relationship 1,178 14,570 Repayments/changes in relationship (34,743 ) (15,199 ) Balance, end of period $ 63,412 $ 96,977 INVESTAR HOLDING CORPORATION NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) Allowance for Credit Losses Effective January 1, 2023, 2016 13, The allowance for credit losses is comprised of reserves measured on a collective (pool) basis based on a lifetime loss-rate model when similar risk characteristics exist. For each pool of loans, the Company evaluates and applies qualitative adjustments to the calculated allowance for credit losses based on several factors, including, but not not third not Refer to Note 1. 2016 13. The Company made the accounting policy election to exclude accrued interest receivable from the amortized cost of loans and the estimate of the allowance for credit losses. Accrued interest receivable on the Company’s loans was $11.0 million and $10.8 million at March 31, 2023 and December 31, 2022 , respectively, and is included in “Accrued interest receivable” on the accompanying consolidated balance sheets. The table below shows a summary of the activity in the allowance for credit losses for the three March 31, 2023 2022 Three months ended March 31, 2023 2022 Balance, beginning of period $ 24,364 $ 20,859 ASU 2016-13 adoption impact (1) 5,865 — Provision for credit losses on loans (2) 556 (449 ) Charge-offs (510 ) (329 ) Recoveries 246 1,007 Balance, end of period $ 30,521 $ 21,088 ( 1 On January 1, 2023 2016 13, 1. 2016 13. ( 2 The $0.4 million provision for credit losses on the consolidated statement of income includes a $0.6 million provision for loan losses and a $0.2 million negative provision for unfunded loan commitments for the three March 31, 2023. The following tables outline the activity in the allowance for credit losses by collateral type for the three March 31, 2023 2022 March 31, 2023 2022 Three months ended March 31, 2023 Construction & Commercial Commercial & Development 1-4 Family Multifamily Farmland Real Estate Industrial Consumer Total Allowance for credit losses: Beginning balance $ 2,555 $ 3,917 $ 999 $ 113 $ 10,718 $ 5,743 $ 319 $ 24,364 ASU 2016-13 adoption impact (75 ) 4,712 (84 ) (99 ) 676 793 (58 ) 5,865 Provision for credit loss on loans 519 58 (5 ) 16 30 (100 ) 38 556 Charge-offs — (42 ) — — — (380 ) (88 ) (510 ) Recoveries 42 5 — — 103 69 27 246 Ending balance $ 3,041 $ 8,650 $ 910 $ 30 $ 11,527 $ 6,125 $ 238 $ 30,521 Ending allowance balance for loans individually evaluated for impairment — 40 — — 77 18 50 185 Ending allowance balance for loans collectively evaluated for impairment 3,041 8,610 910 30 11,450 6,107 188 30,336 Loans receivable: Balance of loans individually evaluated for impairment 332 1,850 — 39 2,545 1,574 117 6,457 Balance of loans collectively evaluated for impairment 209,942 399,479 80,980 10,692 964,612 423,519 13,363 2,102,587 Total period-end balance $ 210,274 $ 401,329 $ 80,980 $ 10,731 $ 967,157 $ 425,093 $ 13,480 $ 2,109,044 Three months ended March 31, 2022 Construction & Commercial Commercial & Development 1-4 Family Multifamily Farmland Real Estate Industrial Consumer Total Allowance for credit losses: Beginning balance $ 2,347 $ 3,337 $ 673 $ 383 $ 9,354 $ 4,411 $ 354 $ 20,859 Provision for credit loss on loans 45 (3 ) (83 ) 13 256 (677 ) — (449 ) Charge-offs — — — (54 ) 58 (286 ) (47 ) (329 ) Recoveries 16 70 — — 1 908 12 1,007 Ending balance $ 2,408 $ 3,404 $ 590 $ 342 $ 9,669 $ 4,356 $ 319 $ 21,088 Ending allowance balance for loans individually evaluated for impairment — — — — — 468 74 542 Ending allowance balance for loans acquired with deteriorated credit quality — — — 156 — — — 156 Ending allowance balance for loans collectively evaluated for impairment 2,408 3,404 590 186 9,669 3,888 245 20,390 Loans receivable: Balance of loans individually evaluated for impairment 508 996 — 74 12,940 12,518 186 27,222 Balance of loans acquired with deteriorated credit quality — 327 — 657 636 — 61 1,681 Balance of loans collectively evaluated for impairment 200,714 366,197 52,500 17,565 894,634 301,575 15,356 1,848,541 Total period-end balance $ 201,222 $ 367,520 $ 52,500 $ 18,296 $ 908,210 $ 314,093 $ 15,603 $ 1,877,444 Loan Modifications to Borrowers Experiencing Financial Difficulty In January 2023, 2022 02, 2022 02 January 1, 2023. 1. 2023. Occasionally, the Company modifies loans to borrowers in financial distress by providing certain concessions, such as principal forgiveness, term extension, an other-than-insignificant payment delay, an interest rate reduction, or a combination of such concessions. When principal forgiveness is provided, the amount of forgiveness is charged-off against the allowance for credit losses. Upon the Company’s determination that a modified loan (or portion of a loan) has subsequently been deemed uncollectible, the loan (or portion of the loan) is written off. During the three March 31, 2023, not INVESTAR HOLDING CORPORATION NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) The following disclosures are presented under GAAP in effect prior to the adoption of CECL that are no Pre-Adoption of CECL - Impaired Loans The Company considered a loan to be impaired when, based on current information and events, the Company determined that it was probable that it would not When the ultimate collectability of the total principal of an impaired loan was in doubt and the loan was on nonaccrual, all payments were applied to principal, under the cost recovery method. When the ultimate collectability of the total principal of an impaired loan was not The following table contains information on the Company’s impaired loans at December 31, 2022 ( December 31, 2022 Recorded Investment Unpaid Principal Balance Related Allowance With no related allowance recorded: Construction and development $ 366 $ 375 $ — 1-4 Family 1,005 1,082 — Farmland 62 70 — Commercial real estate 5,746 21,016 — Total mortgage loans on real estate 7,179 22,543 — Commercial and industrial 1,996 2,530 — Consumer 34 45 — Total 9,209 25,118 — With related allowance recorded: Construction and development 225 498 26 1-4 Family 474 484 46 Commercial real estate 190 190 36 Total mortgage loans on real estate 889 1,172 108 Commercial and industrial 245 292 112 Consumer 96 123 63 Total 1,230 1,587 283 Total loans: Construction and development 591 873 26 1-4 Family 1,479 1,566 46 Farmland 62 70 — Commercial real estate 5,936 21,206 36 Total mortgage loans on real estate 8,068 23,715 108 Commercial and industrial 2,241 2,822 112 Consumer 130 168 63 Total $ 10,439 $ 26,705 $ 283 INVESTAR HOLDING CORPORATION NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) Presented in the table below is the average recorded investment of the impaired loans and the related amount of interest income recognized during the time within the period that the loans were impaired. The average recorded investment is calculated based on the month-end balance of the loans during the period reported (dollars in thousands). Three months ended March 31, 2022 Average Interest Recorded Income Investment Recognized With no related allowance recorded: Construction and development $ 511 $ 4 1-4 Family 1,013 6 Farmland 75 — Commercial real estate 12,806 6 Total mortgage loans on real estate 14,405 16 Commercial and industrial 8,463 26 Consumer 63 — Total 22,931 42 With related allowance recorded: Commercial and industrial 3,926 — Consumer 108 — Total 4,034 — Total loans: Construction and development 511 4 1-4 Family 1,013 6 Farmland 75 — Commercial real estate 12,806 6 Total mortgage loans on real estate 14,405 16 Commercial and industrial 12,389 26 Consumer 171 — Total $ 26,965 $ 42 INVESTAR HOLDING CORPORATION NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) Pre-Adoption of CECL - Troubled Debt Restructurings In situations where, for economic or legal reasons related to a borrower’s financial difficulties, the Company granted a concession for other than an insignificant period of time to the borrower that the Company would not During the three March 31, 2022, one three March 31, 2022, 12 At December 31, 2022 , there wer e no vailable balances on loans classified as TDRs that the Company was committed to lend. INVESTAR HOLDING CORPORATION NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) |