| Loans | 4. Loans Major classifications of loans, net of unearned income, deferred loan origination costs and fees, and net premiums on acquired loans, are summarized
as follows:
(in thousands)
December 31 2023
December 31 2022
Hotel/motel
$
395,765
$
343,640
Commercial real estate residential
417,943
372,914
Commercial real estate nonresidential
778,637
762,349
Dealer floorplans
70,308
77,533
Commercial other
321,082
312,422
Commercial loans
1,983,735
1,868,858
Real estate mortgage
937,524
824,996
Home equity lines
147,036
120,540
Residential loans
1,084,560
945,536
Consumer direct
159,106
157,504
Consumer indirect
823,505
737,392
Consumer loans
982,611
894,896
Loans and lease financing
$
4,050,906
$
3,709,290 The
loan portfolios presented above are net of unearned fees and unamortized premiums. Unearned fees included above totaled $0.8 million as of
December 31, 2023 and $1.0 million as of December 31, 2022, while the unamortized premiums on the indirect lending portfolio totaled $31.4 million as of December 31, 2023 and $28.5
million as of December 31, 2022. CTBI
has segregated and evaluates our loan portfolio through nine portfolio segments with similar risk characteristics. CTBI serves customers
in small and mid-sized communities in eastern, northeastern, central, and south central Kentucky, southern West Virginia, and northeastern Tennessee. Therefore, CTBI’s exposure to credit risk is significantly affected by changes in these
communities. Hotel/motel
loans are a significant concentration for CTBI, representing approximately 9.8% of total loans. This industry has unique risk
characteristics as it is highly susceptible to changes in the domestic and global economic environments, which can cause the industry to experience substantial volatility. Additionally, any hotel/motel construction loans would be included in this
segment as CTBI’s construction loans are primarily completed as one loan going from construction to permanent financing. These loans are originated based on the borrower’s ability to service the debt and secondarily based on the fair value of the
underlying collateral. Commercial
real estate residential loans are commercial purpose construction and permanent financed loans for commercial purpose 1-4 family/multi-family properties. These loans are originated based on the borrower’s ability to service the debt and secondarily
based on the fair value of the underlying collateral. Commercial
real estate nonresidential loans are secured by nonfarm, nonresidential properties, farmland, and other commercial real estate. These loans are originated based on the borrower’s ability to service the debt and secondarily based on the fair value of
the underlying collateral. Construction for commercial real estate nonresidential loans are also included in this segment as these loans are generally one loan for construction to permanent financing. Dealer
floorplans consist of loans to dealerships to finance inventory and are collateralized under a blanket security agreement and without specific liens on individual units. This risk is mitigated by the use of periodic inventory audits. These audits
are performed monthly and follow up is required on any out of compliance items identified. These audits are subject to increasing frequency when fact patterns suggest more scrutiny is required. Commercial
other loans consist of agricultural loans, receivable financing, loans to financial institutions, loans for purchasing or carrying securities, and other commercial purpose loans. Commercial loans are underwritten based on the borrower’s ability to
service debt from the business’s underlying cash flows. As a general practice, we obtain collateral such as equipment, or other assets, although such loans may be uncollateralized but guaranteed. Residential
real estate loans are a mixture of fixed rate and adjustable rate first and second lien residential mortgage loans and also include real estate construction loans which are typically for owner-occupied properties. The terms of the real estate
construction loans are generally short-term with permanent financing upon completion. As a policy, CTBI holds adjustable rate loans and sells the majority of our fixed rate first lien mortgage loans into the secondary market. Changes in interest
rates or market conditions may impact a borrower’s ability to meet contractual principal and interest payments. Residential real estate loans are secured by real property. Home
equity lines are primarily revolving adjustable rate credit lines secured by real property. Consumer
direct loans are a mixture of fixed rate and adjustable rate products comprised of unsecured loans, consumer revolving credit lines, deposit secured loans, and all other consumer purpose loans. Indirect
loans are primarily consumer fixed rate loans secured by automobiles, trucks, vans, and recreational vehicles originated at the selling dealership underwritten and purchased by CTBI’s indirect lending department. Both new and used products are
financed. Only dealers who have executed dealer agreements with CTBI participate in the indirect lending program. Not
included in the loan balances above were loans held for sale in the amount of $0.2 million at December 31, 2023 and $0.1 million at December 31, 2022. For the year ended December 31, 2022 and the three months ended March 31, 2023, CTBI derived our ACL
balance by using vintage modeling for the consumer and residential portfolios. Static pool models incorporating losses by credit risk rating were developed to determine credit loss balances for the commercial loan segments. Qualitative loss
factors were based on CTBI’s judgment of delinquency trends, level of nonperforming loans, trend in loan losses, supervision and administration, quality control exceptions, and reasonable and supportable forecasts based on unemployment rates
and industry concentrations. CTBI determined that twelve months represented a reasonable and supportable forecast period and reverted back to a historical loss rate immediately. CTBI leveraged economic projections from a reputable and
independent third party to form its loss driver forecasts over the twelve-month forecast period. Other internal and external indicators of economic forecasts were also considered by CTBI when developing the forecast metrics. CTBI also had an
inherent model risk allocation included in our ACL calculation to allow for certain known model limitations as well as other potential risks not quantified elsewhere. One limitation was the inability to completely identify revolving line of
credit within the commercial other segment. During the quarter ended June 30, 2023, CTBI implemented third party software for its ACL calculations. During the implementation process, discounted cash flow (“DCF”)
(in thousands)
ACL Software June 30, 2023
CTBI Internal ACL Model June 30, 2023
Change in Allocation
Hotel/motel
$
5,192
$
6,038
$
(846
)
Commercial real estate residential
3,749
4,669
(920
)
Commercial real estate nonresidential
7,797
8,794
(997
)
Dealer floorplans
1,157
1,719
(562
)
Commercial other
6,176
4,547
1,629
Commercial loans reserve allocation
24,071
25,767
(1,696
)
Real estate mortgage
7,884
8,443
(559
)
Home equity lines
1,108
1,065
43
Residential loans reserve allocation
8,992
9,508
(516
)
Consumer direct
2,563
1,673
890
Consumer indirect
12,392
10,959
1,433
Consumer loans reserve allocation
14,955
12,632
2,323
Loans and lease financing allowance for credit loss
$
48,018
47,907
$
111 This change in reserve estimates is related to life of loan and how it functions in a cash flow
methodology versus the loss rate methodology previously used as consumer loans generally have longer lives than commercial loans. Although commercial loans may estimate a higher probability of default/loss given default compared to consumer
loans, their shorter exposures will yield lower reserves. Additionally, there was a change in how some of the qualitative factors were applied using the new software with a switch from a geographical approach to a loan segment approach. The following tables present the balance in the
ACL for the years ended December 31, 2023 and December 31, 2022.
Year Ended December 31, 2023
(in thousands)
Beginning Balance
Provision Charged to Expense
Losses Charged Off
Recoveries
Ending Balance
ACL
Hotel/motel
$
5,171
$
(579
)
$
0
$
0
$
4,592
Commercial real estate residential
4,894
(706
)
(28
)
125
4,285
Commercial real estate nonresidential
9,419
(2,252
)
(294
)
687
7,560
Dealer floorplans
1,776
(1,117
)
0
0
659
Commercial other
5,285
(91
)
(1,900
)
466
3,760
Real estate mortgage
7,932
2,364
(140
)
41
10,197
Home equity
1,106
278
(23
)
6
1,367
Consumer direct
1,694
1,804
(541
)
304
3,261
Consumer indirect
8,704
7,110
(5,333
)
3,381
13,862
Total
$
45,981
$
6,811
$
(8,259
)
$
5,010
$
49,543
Year Ended December 31, 2022
(in thousands)
Beginning Balance
Provision Charged to Expense
Losses Charged Off
Recoveries
Ending Balance
ACL
Hotel/motel
$
5,080
$
307
$
(216
)
$
0
$
5,171
Commercial real estate residential
3,986
951
(92
)
49
4,894
Commercial real estate nonresidential
8,884
(154
)
(46
)
735
9,419
Dealer floorplans
1,436
340
0
0
1,776
Commercial other
4,422
947
(1,082
)
998
5,285
Real estate mortgage
7,637
466
(223
)
52
7,932
Home equity
866
257
(37
)
20
1,106
Consumer direct
1,951
(210
)
(609
)
562
1,694
Consumer indirect
7,494
2,001
(3,041
)
2,250
8,704
Total
$
41,756
$
4,905
$
(5,346
)
$
4,666
$
45,981
Using the ACL software, forecasts were expanded to include gross domestic product
(GDP), retail sales and housing price index considerations. CTBI leverages economic projections from the Federal Open Market Committee to obtain various forecasts for unemployment rate and gross domestic product, the PNC forecast for the
Case-Shiller National Home Price Index, and the Wells Fargo forecast for the Advanced Retail Sales. CTBI has elected to forecast the first four quarters of the credit loss estimate and revert to a long-run average of each considered economic
factor, as permitted in ASC 326-20-30-9, over four quarters. All periods during the reasonable and supportable forecast period are utilizing a forecasted probability of default. During the ACL software
implementation, loss driver analysis was performed during which regression models were built relating default rates of the various segments to the economic factors noted above. Historical loss data for both CTBI and segment-specific selected
peers was incorporated from Federal Financial Institutions Examination Council CTBI continues to use management judgement for qualitative loss factors such as
delinquency trends, supervision and administration, quality control exceptions, collateral values, and industry concentrations, although these factors are applied differently in the ACL software. The software allows management to approve a
“worst case” scenario or a maximum loss rate for each segment. Qualitative dollars available for allocation then become the difference between the worst case and the ACL quantitative
•
Changes in delinquency trends by loan segment
•
Changes in international, national, regional, and local conditions
•
The effect of other external factors (i.e. competition, legal and regulatory requirements) on the level of estimated credit losses
•
The existence and effect of any concentrations of credit and changes in the levels of such concentrations
•
A supervision and administration allocation based on CTBI’s loan review process
•
Exceptions in lending policies and procedures as measured by quarterly loan portfolio exceptions reports
•
Changes in the nature and volume of the portfolio and terms of loans
•
Changes in the experience, depth, and ability of lending management
Provision for credit losses for the year ended
December 31, 2023 increased from $4.9 million for the year ended December 31, 202 Management continues to note the continued impact of global uncertainty, the
current rate of inflation, the uncertain interest rate environment, and the fact that there is no immediate end foreseen, and these conditions are now part of qualitative factors noted above. As in previous periods, an allocation was made for
delinquency trends, industry concentrations, supervisory and administration, loan exceptions, and collateral values. Refer to note 1 to the consolidated
financial statements for further information regarding our nonaccrual policy. Nonaccrual loans and loans 90 days past due and still accruing segregated by class of loans for both December 31, 2023 and December 31, 2022 were as follows:
December 31, 2023
(in thousands)
Nonaccrual Loans with No ACL
Nonaccrual Loans with ACL
90+ and Still Accruing
Total Nonperforming Loans
Hotel/motel
$
0
$
0
$
0
$
0
Commercial real estate residential
0
498
1,059
1,557
Commercial real estate nonresidential
0
680
2,270
2,950
Dealer floorplans 0 0 0 0
Commercial other 236 452 162 850
Total commercial loans
236
1,630
3,491
5,357
Real estate mortgage
0
1,996
5,302
7,298
Home equity lines
0
186
557
743
Total residential loans
0
2,182
5,859
8,041
Consumer direct
0
0
15
15
Consumer indirect
0
0
555
555
Total consumer loans
0
0
570
570
Loans and lease financing
$
236
$
3,812
$
9,920
$
13,968
December 31, 2022
(in thousands)
Nonaccrual Loans with No ACL
Nonaccrual Loans with ACL
90+ and Still Accruing
Total Nonperforming Loans
Hotel/motel
$
0
$
0
$
0
$
0
Commercial real estate residential
0
355
258
613
Commercial real estate nonresidential
0
1,116
1,947
3,063
Dealer floorplans 0 0 0 0
Commercial other
0
982
369
1,351
Total commercial loans
0
2,453
2,574
5,027
Real estate mortgage
0
4,069
4,929
8,998
Home equity lines
0
291
487
778
Total residential loans
0
4,360
5,416
9,776
Consumer direct
0
0
41
41
Consumer indirect
0
0
465
465
Total consumer loans
0
0
506
506
Loans and lease financing
$
0
$
6,813
$
8,496
$
15,309 CTBI recognized $43 thousand in interest income on the above nonaccrual loans for the year ended December 31, 2023 compared to $44 thousand for the year ended December 31, 2022. Discussion of the Nonaccrual Policy The accrual of interest
income on loans is discontinued when management believes, after considering economic and business conditions, collateral value, and collection efforts, that the borrower’s financial condition is such that the collection of interest is doubtful.
Cash payments received on nonaccrual loans generally are applied against principal, and interest income is only recorded once principal recovery is reasonably assured. Any loans greater than 90 days past due must be well secured and in the process of collection to continue accruing interest. See note 1 to the consolidated financial statements for further
discussion on our nonaccrual policy. The following tables present CTBI’s loan portfolio aging analysis,
segregated by class, as of December 31, 2023 and December 31, 2022 (includes loans 90 days past due and still accruing as well):
December 31, 2023
(in thousands)
30-59 Days Past Due
60-89 Days Past Due
90+ Days Past Due
Total Past Due
Current
Total Loans
Hotel/motel
$
0
$
0
$
0
$
0
$
395,765
$
395,765
Commercial real estate residential
1,047
275
1,525
2,847
415,096
417,943
Commercial real estate nonresidential
549
332
2,619
3,500
775,137
778,637
Dealer floorplans
0
0
0
0
70,308
70,308
Commercial other
663
494
641
1,798
319,284
321,082
Total commercial loans
2,259
1,101
4,785
8,145
1,975,590
1,983,735
Real estate mortgage
1,323
3,455
6,168
10,946
926,578
937,524
Home equity lines
911
273
707
1,891
145,145
147,036
Total residential loans
2,234
3,728
6,875
12,837
1,071,723
1,084,560
Consumer direct
1,013
118
15
1,146
157,960
159,106
Consumer indirect
4,550
1,029
555
6,134
817,371
823,505
Total consumer loans
5,563
1,147
570
7,280
975,331
982,611
Loans and lease financing
$
10,056
$
5,976
$
12,230
$
28,262
$
4,022,644
$
4,050,906
December 31, 2022
(in thousands)
30-59 Days Past Due
60-89 Days Past Due
90+ Days Past Due
Total Past Due
Current
Total Loans
Hotel/motel
$
0
$
0
$
0
$
0
$
343,640
$
343,640
Commercial real estate residential
602
225
574
1,401
371,513
372,914
Commercial real estate nonresidential
2,549
395
2,611
5,555
756,794
762,349
Dealer floorplans
0
0
0
0
77,533
77,533
Commercial other
1,029
850
496
2,375
310,047
312,422
Total commercial loans
4,180
1,470
3,681
9,331
1,859,527
1,868,858
Real estate mortgage
869
3,402
7,067
11,338
813,658
824,996
Home equity lines
786
44
740
1,570
118,970
120,540
Total residential loans
1,655
3,446
7,807
12,908
932,628
945,536
Consumer direct
555
126
41
722
156,782
157,504
Consumer indirect
4,407
764
465
5,636
731,756
737,392
Total consumer loans
4,962
890
506
6,358
888,538
894,896
Loans and lease financing
$
10,797
$
5,806
$
11,994
$
28,597
$
3,680,693
$
3,709,290 The risk characteristics of CTBI’s material portfolio segments are as follows: Hotel/motel loans are a significant concentration for CTBI, representing approximately 9.8% of total loans. This industry has unique risk characteristics as it is highly susceptible to changes in the domestic and global economic environments, which can cause the industry to
experience substantial volatility. These loans are viewed primarily as cash flow loans and secondarily as loans secured by real estate. Hotel/motel lending typically involves higher loan principal amounts and the repayment of these loans is
generally dependent on the successful operation of the property securing the loan or the business conducted on the property securing the loan. Management monitors and evaluates all commercial real estate loans based on collateral and risk grade
criteria. Commercial construction loans generally are made to customers for the purpose of building income-producing properties, and any hotel/motel construction loan would be included in this segment. Personal guarantees of the principals are
generally required. Such loans are made on a projected cash flow basis and are secured by the project being constructed. Construction loan draw procedures are included in each specific loan agreement, including required documentation items and
inspection requirements. Construction loans may convert to term loans at the end of the construction period, or may be repaid by the take-out commitment from another financing source. If the loan is to convert to a term loan, the repayment ability
is based on the borrower’s projected cash flow. Risk is mitigated during the construction phase by requiring proper documentation and inspections whenever a draw is requested. Commercial real estate residential loans are commercial purpose construction and permanent financed loans for commercial purpose 1-4
family/multi-family properties. All commercial real estate loans are viewed primarily as cash flow loans and secondarily as loans secured by real estate. Management monitors and evaluates all commercial real estate loans based on collateral and
risk grade criteria. Commercial residential construction loans generally are made to customers for the purpose of building income-producing properties. Personal guarantees of the principals are generally required. Such loans are made on a
projected cash flow basis and are secured by the project being constructed. Construction loan draw procedures are included in each specific loan agreement, including required documentation items and inspection requirements. Construction loans may
convert to term loans at the end of the construction period, or may be repaid by the take-out commitment from another financing source. If the loan is to convert to a term loan, the repayment ability is based on the borrower’s projected cash flow.
Risk is mitigated during the construction phase by requiring proper documentation and inspections whenever a draw is requested. Commercial real estate nonresidential loans are secured by nonfarm, nonresidential properties, farmland, and other commercial real estate.
Construction for commercial real estate nonresidential loans are also included in this segment as these loans are generally one loan for construction to permanent financing. All commercial real estate loans are viewed primarily as cash flow loans
and secondarily as loans secured by real estate. Management monitors and evaluates all commercial real estate loans based on collateral and risk grade criteria. Commercial nonresidential construction loans generally are made to customers for the
purpose of building income-producing properties. Personal guarantees of the principals are generally required. Such loans are made on a projected cash flow basis and are secured by the project being constructed. Construction loan draw procedures
are included in each specific loan agreement, including required documentation items and inspection requirements. Construction loans may convert to term loans at the end of the construction period, or may be repaid by the take-out commitment from
another financing source. If the loan is to convert to a term loan, the repayment ability is based on the borrower’s projected cash flow. Risk is mitigated during the construction phase by requiring proper documentation and inspections whenever a
draw is requested. Dealer floorplans are segmented separately as they are a unique product with unique risk factors. CTBI maintains strict processing procedures over
our floorplan product with any exceptions requested by a loan officer approved by the appropriate loan committee and the floorplan manager. Commercial other loans are primarily based on the identified cash flows of the borrower and secondarily on the underlying collateral provided by the
borrower. The cash flows of borrowers, however, may not be as expected and the collateral securing these loans may fluctuate in value. Most commercial loans are secured by the assets being financed or other business assets such as accounts
receivable or inventory and may incorporate a personal guarantee; however, some short-term loans may be made on an unsecured basis. In the case of loans secured by accounts receivable, the availability of funds for the repayment of these loans may
be substantially dependent on the ability of the borrower to collect amounts due from our customers. As we underwrite our equipment lease financing in a manner similar to our commercial loan portfolio described below, the risk characteristics for
this portfolio mirror that of the commercial loan portfolio. CTBI’s participation in the CARES Act PPP loan program had
previously resulted in a new loan segment of unsecured commercial other loans that are 100% guaranteed by the U.S. Small Business Administration (“SBA”). As the balances are now less than $1.0 million, these loans have been collapsed into the commercial other segment. These loans have maturities of either two or three to five years, depending on when the loans
were made. These loans currently have no ACL. With respect to residential loans that are secured by 1-4 family residences and are generally owner occupied, CTBI generally establishes a maximum
loan-to-value ratio and requires private mortgage insurance if that ratio is exceeded. Home equity loans are typically secured by a subordinate interest in 1-4 family residences. Residential construction loans are handled through the home mortgage
area of the bank. The repayment ability of the borrower and the maximum loan-to-value ratio are calculated using the normal mortgage lending criteria. Draws are processed based on percentage of completion stages including normal inspection
procedures. Such loans generally convert to term loans after the completion of construction. Consumer loans are secured by consumer assets such as automobiles or recreational vehicles. Some consumer loans are unsecured such as small
installment loans and certain lines of credit. Our determination of a borrower’s ability to repay these loans is primarily dependent on the personal income and credit rating of the borrowers, which can be impacted by economic conditions in their
market areas such as unemployment levels. Repayment can also be impacted by changes in property values on residential properties. Risk is mitigated by the fact that the loans are of smaller individual amounts and spread over a large number of
borrowers. The indirect lending area
of the bank is generally responsible for purchasing/funding consumer contracts with new and used automobile dealers. Dealer loan applications are forwarded to the indirect loan processing area for approval or denial. Loan approvals or denials are
based on the creditworthiness and repayment ability of the borrowers, and on the collateral value. Upon a dealer being funded on an approved loan application and assignment of the retail installment contract to CTB, CTB will have limited recourse
with the dealer, as set forth in the CTB dealer agreement. On occasion, the dealer will execute a separate, full recourse agreement with CTB to obtain customer financing. Credit Quality Indicators CTBI categorizes loans 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. CTBI also considers the fair value of the underlying collateral and the strength and willingness of the
guarantor(s). CTBI analyzes commercial loans individually by classifying the loans as to credit risk. Loans classified as loss, doubtful, substandard, or special mention are reviewed quarterly by CTBI for further deterioration or improvement to
determine if appropriately classified and valued if deemed impaired. All other commercial loan reviews are completed every 12 to 18 months. In addition, during the renewal process of any loan, as well as if a loan becomes past due or if other information becomes available, CTBI
will evaluate the loan grade. CTBI uses the following definitions for risk ratings:
➢
Pass grades
include investment grade, low risk, moderate risk, and acceptable risk loans. The loans range from loans that have no chance of resulting in a loss to loans that have a limited chance of resulting in a loss. Customers in this grade have
excellent to fair credit ratings. The cash flows are adequate to meet required debt repayments.
➢
Watch graded
loans are loans that warrant extra management attention but are not currently criticized. Loans on the watch list may be potential troubled credits or may warrant “watch” status for a reason not directly related to the asset quality of the
credit. The watch grade is a management tool to identify credits which may be candidates for future classification or may temporarily warrant extra management monitoring.
➢
Other assets especially mentioned (OAEM) reflects loans that are currently protected but are potentially weak. These loans constitute an undue and unwarranted credit risk but not to the point of justifying a classification of substandard. The
credit risk may be relatively minor yet constitute an unwarranted risk in light of circumstances surrounding a specific asset. Loans in this grade display potential weaknesses which may, if unchecked or uncorrected, inadequately protect
CTBI’s credit position at some future date. The loans may be adversely affected by economic or market conditions.
➢
Substandard
grading indicates that the loan is inadequately protected by the current sound worth and paying capacity of the obligor or of the collateral pledged. These loans have a well-defined weakness or weaknesses that jeopardize the orderly
liquidation of the debt with the distinct possibility that CTBI will sustain some loss if the deficiencies are not corrected.
➢
Doubtful graded
loans have the weaknesses inherent in the substandard grading with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions, and values, highly questionable
and improbable. The probability of loss is extremely high, but because of certain important and reasonably specific pending factors which may work to CTBI’s advantage or strengthen the asset(s), its classification as an estimated loss is
deferred until its more exact status may be determined. Pending factors include proposed merger, acquisition, or liquidation procedures, capital injection, perfecting liens on additional collateral, and refinancing plans. The following tables present the credit risk profile of CTBI’s commercial loan portfolio based on rating category and payment activity, segregated by
class of loans and based on last credit decision or year of origination:
Term Loans Amortized Cost Basis by Origination Year
(in thousands) December 31
2023
2022
2021
2020
2019
Prior
Revolving Loans
Total
Hotel/motel
Risk rating:
Pass
$
79,651
$
144,826
$
28,011
$
17,664
$
40,873
$
42,030
$
4,042
$
357,097
Watch
11,569
2,826
6,835
4,623
3,361
1,648 0
30,862
OAEM
0
3,982
0
0
0
1,954
0
5,936
Substandard
0
0
0
0
0
1,118
0
1,118
Doubtful
0
0
0
0
0
752
0
752
Total hotel/motel
91,220
151,634
34,846
22,287
44,234
47,502
4,042
395,765
Commercial real estate residential
Risk rating:
Pass
109,304
89,119
98,896
30,972
11,908
36,964
14,700
391,863
Watch
2,317
2,131
473
1,395
721
6,359
124
13,520
OAEM
0
0
0
0
0
63
0
63
Substandard
760
854
4,532
834
285
5,232
0
12,497
Doubtful
0
0
0
0
0
0
0
0
Total commercial real estate residential
112,381
92,104
103,901
33,201
12,914
48,618
14,824
417,943
Commercial real estate residential current period gross charge-offs 0 0 (28 ) 0 0 0 0 (28 )
Commercial real estate nonresidential
Risk rating:
Pass
149,633
142,580
136,090
68,240
55,850
140,074
31,536
724,003
Watch
552
3,664
6,305
2,347
1,938
6,003
354
21,163
OAEM
2,375
15
0
7,255
0
1,486
0
11,131
Substandard
2,520
1,598
2,538
4,472
2,000
9,199
0
22,327
Doubtful
0
0
0
0
0
13
0
13
Total commercial real estate nonresidential
155,080
147,857
144,933
82,314
59,788
156,775
31,890
778,637
Commercial real estate nonresidential current period gross charge-offs 0 0 (7 ) 0 0 (287 ) 0 (294 )
Dealer floorplans
Risk rating:
Pass
0
0
0
0
0
0
70,308
70,308
Watch
0
0
0
0
0
0
0
0
OAEM
0
0
0
0
0
0
0
0
Substandard
0
0
0
0
0
0
0
0
Doubtful
0
0
0
0
0
0
0
0
Total dealer floorplans
0
0
0
0
0
0
70,308
70,308
Commercial other
Risk rating:
Pass
73,115
47,575
40,448
30,033
4,780
22,588
81,791
300,330
Watch
1,138
1,109
569
126
239
635
5,877
9,693
OAEM
29
0
0
0
0
0
30
59
Substandard
4,921
3,581
381
890
211
403
613
11,000
Doubtful
0
0
0
0
0
0
0
0
Total commercial other
79,203
52,265
41,398
31,049
5,230
23,626
88,311
321,082
Commercial other current
period gross charge-offs (725 ) (710 ) (302 ) (27 ) (90 ) (46 ) 0 (1,900 )
Commercial loans
Risk rating:
Pass
411,703
424,100
303,445
146,909
113,411
241,655
202,377
1,843,600
Watch
15,576
9,730
14,182
8,491
6,259
14,645
6,355
75,238
OAEM
2,404
3,997
0
7,255
0
3,503
30
17,189
Substandard
8,201
6,033
7,451
6,196
2,496
15,952
613
46,942
Doubtful
0
0
0
0
0
766
0
766
Total commercial loans
$
437,884
$
443,860
$
325,078
$
168,851
$
122,166
$
276,521
$
209,375
$
1,983,735
Total commercial loans current period gross charge-offs $ (725 ) $ (710 ) $ (337 ) $ (27 ) $ (90 ) $ (333 ) $ 0 $ (2,222 )
Term Loans Amortized Cost Basis by Origination Year
(in thousands) December 31 2022 2021
2020 2019 2018 Prior Revolving Loans Total
Hotel/motel
Risk rating:
Pass
$
145,262
$
36,002
$
17,742
$
54,328
$
13,178
$
35,179
$
545
$
302,236
Watch
7,921
8,996
5,523
3,453
0
13,555 0
39,448
OAEM
0
0
0
0
0
1,956
0
1,956
Substandard
0
0
0
0
0
0
0
0
Doubtful
0
0
0
0
0
0
0
0
Total hotel/motel
153,183
44,998
23,265
57,781
13,178
50,690
545
343,640
Commercial real estate residential
Risk rating:
Pass
119,826
110,963
38,423
15,467
10,492
36,307
14,297
345,775
Watch
1,474
898
1,675
848
2,136
7,015
152
14,198
OAEM
0
0
0
39
0
0
29
68
Substandard
182
4,289
1,878
346
3,639
2,539
0
12,873
Doubtful
0
0
0
0
0
0
0
0
Total commercial real estate residential
121,482
116,150
41,976
16,700
16,267
45,861
14,478
372,914
Commercial real estate nonresidential
Risk rating:
Pass
175,220
171,311
80,932
70,848
44,099
137,575
23,166
703,151
Watch
3,331
5,765
10,090
2,178
1,962
10,022
1,550
34,898
OAEM
19
0
0
0
0
90
0
109
Substandard
1,939
2,537
4,877
3,135
508
10,865
25
23,886
Doubtful
0
0
0
0
0
305
0
305
Total commercial real estate nonresidential
180,509
179,613
95,899
76,161
46,569
158,857
24,741
762,349
Dealer floorplans
Risk rating:
Pass
0
0
0
0
0
0
77,153
77,153
Watch
0
0
0
0
0
0
380
380
OAEM
0
0
0
0
0
0
0
0
Substandard
0
0
0
0
0
0
0
0
Doubtful
0
0
0
0
0
0
0
0
Total dealer floorplans
0
0
0
0
0
0
77,533
77,533
Commercial other
Risk rating:
Pass
78,846
60,550
34,841
8,922
2,333
23,961
77,355
286,808
Watch
1,622
393
604
217
159
780
6,402
10,177
OAEM
30
0
0
0
0
0
30
60
Substandard
6,090
5,489
885
356
143
758
952
14,673
Doubtful
466
129 |
