| Loans and Allowance for Credit Losses | Note 3: Loans and Allowance for Credit Losses The Company adopted ASU 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments The Company adopted ASC 326 using the prospective transition approach for financial assets purchased with credit deterioration (PCD) that were previously classified as purchased credit impaired (PCI) and accounted for under ASC 310-30. In accordance with the standard, management did not reassess whether PCI assets met the criteria of PCD assets as of the date of adoption. On January 1, 2021, the amortized cost basis of the PCD assets were adjusted to reflect the addition of $1.9 million to the allowance for credit losses. Results for reporting periods prior to January 1, 2021, continue to be reported in accordance with previously applicable GAAP. Under the incurred loss model, the Company delayed recognition of losses until it was probable that a loss was incurred. The allowance for credit losses was established as losses were estimated to have occurred through a provision for credit losses charged to earnings. Credit losses were charged against the allowance when management believed the uncollectability of a loan balance was confirmed. The allowance for credit losses was evaluated on a regular basis by management and was based upon management’s periodic review of the collectability of the loans in light of historical experience, the nature and volume of the loan portfolio, adverse situations that may affect the borrower’s ability to repay, estimated value of any underlying collateral and prevailing economic conditions. The allowance consisted of allocated and general components. The allocated component related to loans that were classified as impaired. For loans classified as impaired, an allowance was established when the present value of expected future cash flows (or collateral value or observable market price) of the impaired loan was lower than the carrying value of that loan. The general component covered non-classified loans and was based on historical charge-off experience and expected loss given default derived from the Company’s internal risk rating process. Results for reporting periods after December 31, 2020, include loans acquired and accounted for under ASC 310-30 net of discount within the loan classes, while for reporting periods prior to January 1, 2021, the loans acquired and accounted for under ASC 310-30 were shown separately. Beginning on January 1, 2021, the allowance for credit losses is measured using an average historical loss model which incorporates relevant information about past events (including historical credit loss experience on loans with similar risk characteristics), current conditions, and reasonable and supportable forecasts that affect the collectability of the remaining cash flows over the contractual term of the loans. The allowance for credit losses is measured on a collective (pool) basis. Loans are aggregated into pools based on similar risk characteristics including borrower type, collateral and repayment types and expected credit loss patterns. Loans that do not share similar risk characteristics, primarily classified and/or TDR loans with a balance greater than or equal to $100,000, are evaluated on an individual basis. For loans evaluated for credit losses on a collective basis, average historical loss rates are calculated for each pool using the Company’s historical net charge-offs (combined charge-offs and recoveries by observable historical reporting period) and outstanding loan balances during a lookback period. Lookback periods can be different based on the individual pool and represent management’s credit expectations for the pool of loans over the remaining contractual life. In certain loan pools, if the Company’s own historical loss rate is not reflective of the loss expectations, the historical loss rate is augmented by industry and peer data. The calculated average net charge-off rate is then adjusted for current conditions and reasonable and supportable forecasts. These adjustments increase or decrease the average historical loss rate to reflect expectations of future losses given economic forecasts of key macroeconomic variables including, but not limited to, unemployment rate, GDP, disposable income and market volatility. The adjustments are based on results from various regression models projecting the impact of the macroeconomic variables to loss rates. The forecast is used for a reasonable and supportable period before reverting to historical averages using a straight-line method. The forecast-adjusted loss rate is applied to the amortized cost of loans over the remaining contractual lives, adjusted for expected prepayments. The contractual term excludes expected extensions, renewals and modifications unless there is a reasonable expectation that a troubled debt restructuring will be executed. Additionally, the allowance for credit losses considers other qualitative factors not included in historical loss rates or macroeconomic forecasts such as changes in portfolio composition, underwriting practices, or significant unique events or conditions. ASU 2016-13 requires an allowance for off balance sheet credit exposures; unfunded lines of credit, undisbursed portions of loans, written residential and commercial commitments, and letters of credit. To determine the amount needed for allowance purposes, a utilization rate is determined either by the model or internally for each pool. Our loss model calculates the reserve on unfunded commitments based upon the utilization rate multiplied by the average loss rate factors in each pool with unfunded and committed balances. The liability for unfunded lending commitments utilizes the same model as the allowance for credit losses on loans; however, the liability for unfunded lending commitments incorporates assumptions for the portion of unfunded commitments that are expected to be funded. Classes of loans at December 31, 2021 and 2020, included: December 31, December 31, 2021 2020 (In Thousands) One- to four-family residential construction $ 28,302 $ 20,718 Subdivision construction 26,694 4,917 Land development 47,827 54,010 Commercial construction 617,505 484,372 Owner occupied one- to four-family residential 561,958 470,310 Non-owner occupied one- to four-family residential 119,635 114,498 Commercial real estate 1,476,230 1,541,242 Other residential 697,903 999,447 Commercial business 280,513 318,023 Industrial revenue bonds 14,203 14,003 Consumer auto 48,915 86,173 Consumer other 37,902 40,762 Home equity lines of credit 119,965 114,689 Loans acquired and accounted for under ASC 310-30, net of discounts(1) — 98,643 4,077,552 4,361,807 Allowance for credit losses (60,754) (55,743) Deferred loan fees and gains, net (9,298) (9,260) $ 4,007,500 $ 4,296,804 (1) Loans acquired and accounted for under ASC 310-30 of $74.2 million have been included in the totals by loan class as of December 31, 2021. At the date of CECL adoption, the Company did not reassess whether PCI loans met the criteria of PCD loans. Classes of loans by aging were as follows as of the dates indicated: December 31, 2021 Total Loans Over 90 Total > 90 Days Past 30-59 Days 60-89 Days Days Total Past Loans Due and Past Due Past Due Past Due Due Current Receivable Still Accruing (In Thousands) One- to four-family residential construction $ — $ — $ — $ — $ 28,302 $ 28,302 $ — Subdivision construction — — — — 26,694 26,694 — Land development 29 15 468 512 47,315 47,827 — Commercial construction — — — — 617,505 617,505 — Owner occupied one- to four- family residential 843 2 2,216 3,061 558,897 561,958 — Non-owner occupied one- to four-family residential — — — — 119,635 119,635 — Commercial real estate — — 2,006 2,006 1,474,224 1,476,230 — Other residential — — — — 697,903 697,903 — Commercial business 1,404 — — 1,404 279,109 280,513 — Industrial revenue bonds — — — — 14,203 14,203 — Consumer auto 229 31 34 294 48,621 48,915 — Consumer other 126 28 63 217 37,685 37,902 — Home equity lines of credit — — 636 636 119,329 119,965 — Total $ 2,631 $ 76 $ 5,423 $ 8,130 $ 4,069,422 $ 4,077,552 $ — FDIC-assisted acquired loans included above $ 433 $ — $ 1,736 $ 2,169 $ 72,001 $ 74,170 $ — December 31, 2020 Total Loans Over 90 Total > 90 Days Past 30-59 Days 60-89 Days Days Total Past Loans Due and Past Due Past Due Past Due Due Current Receivable Still Accruing (In Thousands) One- to four-family residential construction $ 1,365 $ — $ — $ 1,365 $ 19,353 $ 20,718 $ — Subdivision construction — — — — 4,917 4,917 — Land development 20 — — 20 53,990 54,010 — Commercial construction — — — — 484,372 484,372 — Owner occupied one- to four- family residential 1,379 113 1,502 2,994 467,316 470,310 — Non-owner occupied one- to four-family residential — — 69 69 114,429 114,498 — Commercial real estate — 79 587 666 1,540,576 1,541,242 — Other residential — — — — 999,447 999,447 — Commercial business — — 114 114 317,909 318,023 — Industrial revenue bonds — — — — 14,003 14,003 — Consumer auto 364 119 169 652 85,521 86,173 — Consumer other 443 7 94 544 40,218 40,762 — Home equity lines of credit 153 111 508 772 113,917 114,689 — Loans acquired and accounted for under ASC 310-30, net of discounts 1,662 641 3,843 6,146 92,497 98,643 — 5,386 1,070 6,886 13,342 4,348,465 4,361,807 — Less: Loans acquired and accounted for under ASC 310-30, net of discounts 1,662 641 3,843 6,146 92,497 98,643 — Total $ 3,724 $ 429 $ 3,043 $ 7,196 $ 4,255,968 $ 4,263,164 $ — Loans are placed on nonaccrual status at 90 days past due and interest is considered a loss unless the loan is well secured and in the process of collection. Payments received on nonaccrual loans are applied to principal until the loans are returned to accrual status. Loans are returned to accrual status when all payments contractually due are brought current, payment performance is sustained for a period of time, generally six months, and future payments are reasonably assured. With the exception of consumer loans, charge-offs on loans are recorded when available information indicates a loan is not fully collectible and the loss is reasonably quantifiable. Consumer loans are charged-off at specified delinquency dates consistent with regulatory guidelines. Non-accruing loans as of December 31, 2020 shown below exclude $3.8 million in loans acquired and accounted for under ASC 310-30, while the non-accruing loans as of December 31, 2021 shown below include $1.7 million in loans acquired through various FDIC-assisted transactions in the loan classes listed. December 31, December 31, 2021 2020 (In Thousands) One- to four-family residential construction $ — $ — Subdivision construction — — Land development 468 — Commercial construction — — Owner occupied one- to four-family residential 2,216 1,502 Non-owner occupied one- to four-family residential — 69 Commercial real estate 2,006 587 Other residential — — Commercial business — 114 Industrial revenue bonds — — Consumer auto 34 169 Consumer other 63 94 Home equity lines of credit 636 508 Total non-accruing loans $ 5,423 $ 3,043 FDIC-assisted acquired loans included above $ 1,736 No interest income was recorded on these loans for the years ended December 31, 2021 and 2020, respectively. Nonaccrual loans for which there is no related allowance for credit losses as of December 31, 2021 had an amortized cost of $2.0 million. These loans are individually assessed and do not require an allowance due to being adequately collateralized under the collateral-dependent valuation method. A collateral-dependent loan is a financial asset for which the repayment is expected to be provided substantially through the operation or sale of the collateral when the borrower is experiencing financial difficulty based on the Company’s assessment as of the reporting date. Collateral-dependent loans are identified by either a classified risk rating or TDR status and a loan balance equal to or greater than $100,000, including, but not limited to, any loan in process of foreclosure or repossession. The following table presents the activity in the allowance for credit losses by portfolio segment for the year ended December 31, 2021. On January 1, 2021, the Company adopted the CECL methodology, which added $11.6 million to the total Allowance for Credit Loss, including $1.9 million of remaining discount on loans that were previously accounted for as PCI. December 31, 2021 One- to Four- Family Residential and Other Commercial Commercial Commercial Construction Residential Real Estate Construction Business Consumer Total (In Thousands) Allowance for credit losses Balance, December 31, 2020 $ 4,536 $ 9,375 $ 33,707 $ 3,521 $ 2,390 $ 2,214 $ 55,743 CECL adoption 4,533 5,832 (2,531) (1,165) 1,499 3,427 11,595 Balance, January 1, 2021 9,069 15,207 31,176 2,356 3,889 5,641 67,338 Provision (credit) charged to expense — (4,797) (2,478) 575 — — (6,700) Losses charged off (190) — (142) (154) (81) (2,054) (2,621) Recoveries 485 92 48 20 334 1,758 2,737 Balance, December 31, 2021 $ 9,364 $ 10,502 $ 28,604 $ 2,797 $ 4,142 $ 5,345 $ 60,754 The following table presents the activity in the allowance for unfunded commitments by portfolio segment for the year ended December 31, 2021. On January 1, 2021, the Company adopted the CECL methodology, which created an $8.7 million allowance for unfunded commitments. December 31, 2021 One- to Four- Family Residential and Other Commercial Commercial Commercial Construction Residential Real Estate Construction Business Consumer Total (In Thousands) Allowance for unfunded commitments Balance, December 31, 2020 $ — $ — $ — $ — $ — $ — $ — CECL adoption 917 5,227 354 910 935 347 8,690 Balance, January 1, 2021 917 5,227 354 910 935 347 8,690 Provision (credit) charged to expense (230) 476 13 (2) 647 35 939 Balance, December 31, 2021 $ 687 $ 5,703 $ 367 $ 908 $ 1,582 $ 382 $ 9,629 The following table presents the activity in the allowance for credit losses by portfolio segment for the years ended December 31, 2020 and 2019, respectively, prepared using the previous GAAP incurred loss method prior to the adoption of ASU 2016-13. Also presented are the balance in the allowance for credit losses and the recorded investment in loans based on portfolio segment and impairment method as of the years ended December 31, 2020 and 2019, respectively, prepared using the previous GAAP incurred loss method prior to the adoption of ASU 2016-13. December 31, 2020 One- to Four- Family Residential and Other Commercial Commercial Commercial Construction Residential Real Estate Construction Business Consumer Total (In Thousands) Allowance for Loan Losses Balance, January 1, 2020 $ 4,339 $ 5,153 $ 24,334 $ 3,076 $ 1,355 $ 2,037 $ 40,294 Provision (benefit) charged to expense 84 4,042 9,343 242 914 1,246 15,871 Losses charged off (70) — (43) (1) (28) (3,152) (3,294) Recoveries 183 180 73 204 149 2,083 2,872 Balance, December 31, 2020 $ 4,536 $ 9,375 $ 33,707 $ 3,521 $ 2,390 $ 2,214 $ 55,743 Ending balance: Individually evaluated for impairment $ 90 $ — $ 445 $ — $ 14 $ 164 $ 713 Collectively evaluated for impairment $ 4,382 $ 9,282 $ 32,937 $ 3,378 $ 2,331 $ 2,040 $ 54,350 Loans acquired and accounted for under ASC 310-30 $ 64 $ 93 $ 325 $ 143 $ 45 $ 10 $ 680 Loans Individually evaluated for impairment $ 3,546 $ — $ 3,438 $ — $ 167 $ 1,897 $ 9,048 Collectively evaluated for impairment $ 655,146 $ 1,021,145 $ 1,550,239 $ 1,266,847 $ 384,734 $ 239,727 $ 5,117,838 Loans acquired and accounted for under ASC 310-30 $ 57,113 $ 6,150 $ 24,613 $ 2,551 $ 2,549 $ 5,667 $ 98,643 December 31, 2019 One- to Four- Family Residential and Other Commercial Commercial Commercial Construction Residential Real Estate Construction Business Consumer Total (In Thousands) Allowance for Loan Losses Balance, January 1, 2019 $ 3,122 $ 4,713 $ 19,803 $ 3,105 $ 1,568 $ 6,098 $ 38,409 Provision (benefit) charged to expense 1,625 603 4,651 22 (309) (442) 6,150 Losses charged off (534) (189) (144) (101) (371) (6,723) (8,062) Recoveries 126 26 24 50 467 3,104 3,797 Balance, December 31, 2019 $ 4,339 $ 5,153 $ 24,334 $ 3,076 $ 1,355 $ 2,037 $ 40,294 Ending balance: Individually evaluated for impairment $ 198 $ — $ 517 $ — $ 13 $ 201 $ 929 Collectively evaluated for impairment $ 3,973 $ 5,101 $ 23,570 $ 2,940 $ 1,306 $ 1,814 $ 38,704 Loans acquired and accounted for under ASC 310-30 $ 168 $ 52 $ 247 $ 136 $ 36 $ 22 $ 661 Loans Individually evaluated for impairment $ 2,960 $ — $ 4,020 $ — $ 1,286 $ 2,001 $ 10,267 Collectively evaluated for impairment $ 554,450 $ 866,006 $ 1,490,152 $ 1,363,292 $ 325,112 $ 315,561 $ 4,914,573 Loans acquired and accounted for under ASC 310-30 $ 74,562 $ 5,334 $ 29,158 $ 3,606 $ 3,356 $ 11,190 $ 127,206 The portfolio segments used in the preceding three tables correspond to the loan classes used in all other tables in Note 3 ● The one- to four-family residential and construction segment includes the one- to four-family residential construction, subdivision construction, owner occupied one- to four-family residential and non-owner occupied one- to four-family residential classes. ● The other residential segment corresponds to the other residential class. ● The commercial real estate segment includes the commercial real estate and industrial revenue bonds classes. ● The commercial construction segment includes the land development and commercial construction classes. ● The commercial business segment corresponds to the commercial business class. ● The consumer segment includes the consumer auto, consumer other and home equity lines of credit classes. The weighted average interest rate on loans receivable at December 31, 2021 and 2020, was 4.26% and 4.29%, respectively. Loans serviced for others are not included in the accompanying consolidated statements of financial condition. The unpaid principal balance of loans serviced for others at December 31, 2021, was $385.8 million, consisting of $249.5 million of commercial loan participations sold to other financial institutions and $136.3 million of residential mortgage loans sold. The unpaid principal balance of loans serviced for others at December 31, 2020, was $462.7 million, consisting of $308.4 million of commercial loan participations sold to other financial institutions and $154.3 million of residential mortgage loans sold. In addition, available lines of credit on these loans were $130.9 million and $46.1 million at December 31, 2021 and 2020, respectively. The following table presents the amortized cost basis of collateral-dependent loans by class of loans as of December 31, 2021: December 31, 2021 Principal Specific Balance Allowance (In Thousands) One- to four-family residential construction $ — $ — Subdivision construction — — Land development 468 — Commercial construction — — Owner occupied one- to four-family residential 1,980 18 Non-owner occupied one- to four-family residential — — Commercial real estate 2,217 397 Other residential — — Commercial business — — Industrial revenue bonds — — Consumer auto — — Consumer other 160 80 Home equity lines of credit 377 — Total $ 5,202 $ 495 Prior to adoption of ASU 2016-13, a loan was considered impaired, in accordance with the impairment accounting guidance (FASB ASC 310-10-35-16) when, based on then-current information and events, it was probable the Company would be unable to collect all amounts due from the borrower in accordance with the contractual terms of the loan. Impaired loans included not only nonperforming loans but also loans modified in troubled debt restructurings where concessions had been granted to borrowers experiencing financial difficulties. The following table presents information pertaining to impaired loans as of December 31, 2020 and 2019, respectively, in accordance with previous GAAP prior to the adoption of ASU 2016-13. Year Ended December 31, 2020 December 31, 2020 Average Unpaid Investment Interest Recorded Principal Specific in Impaired Income Balance Balance Allowance Loans Recognized (In Thousands) One- to four-family residential construction $ — $ — $ — $ — $ — Subdivision construction 20 20 — 115 3 Land development — — — — — Commercial construction — — — — — Owner occupied one- to four-family residential 3,457 3,776 90 2,999 169 Non-owner occupied one- to four-family residential 69 106 — 309 18 Commercial real estate 3,438 3,472 445 3,736 135 Other residential — — — — — Commercial business 166 551 14 800 34 Industrial revenue bonds — — — — — Consumer auto 865 964 140 932 91 Consumer other 403 552 19 298 47 Home equity lines of credit 630 668 5 550 36 Total $ 9,048 $ 10,109 $ 713 $ 9,739 $ 533 Year Ended December 31, 2019 December 31, 2019 Average Unpaid Investment Interest Recorded Principal Specific in Impaired Income Balance Balance Allowance Loans Recognized (In Thousands) One- to four-family residential construction $ — $ — $ — $ — $ — Subdivision construction 251 251 96 277 9 Land development — — — 328 101 Commercial construction — — — — — Owner occupied one- to four-family residential 2,300 2,423 82 2,598 131 Non-owner occupied one- to four-family residential 409 574 20 954 43 Commercial real estate 4,020 4,049 517 4,940 264 Other residential — — — — — Commercial business 1,286 1,771 13 1,517 81 Industrial revenue bonds — — — — — Consumer auto 1,117 1,334 181 1,128 125 Consumer other 356 485 16 383 48 Home equity lines of credit 528 548 4 362 37 Total $ 10,267 $ 11,435 $ 929 $ 12,487 $ 839 At December 31, 2020, $4.8 million of impaired loans had specific valuation allowances totaling $713,000 . At December 31, 2019, $5.2 million of impaired loans had specific valuation allowances totaling $929,000. For loans which were non-accruing, interest of approximately $432,000, $579,000 and $761,000 would have been recognized on an accrual basis during the years ended December 31, 2021, 2020 and 2019, respectively. TDRs are loans that are modified by granting concessions to borrowers experiencing financial difficulties. These concessions could include a reduction in the interest rate on the loan, payment extensions, forgiveness of principal, forbearance or other actions intended to maximize collection. The types of concessions made are factored into the estimation of the allowance for credit losses for TDRs primarily using a discounted cash flows or collateral adequacy approach TDRs by class are presented below as of December 31, 2021 and 2020. The December 31, 2020 table excludes $1.7 million of FDIC-assisted acquired loans accounted for under ASC 310-30, while the December 31, 2021 table includes the loans acquired through various FDIC-assisted transactions in the loan classes listed. December 31, 2021 Accruing TDR Loans Non-accruing TDR Loans Total TDR Loans Number Balance Number Balance Number Balance (In Thousands) Construction and land development 1 $ 15 — $ — 1 $ 15 One- to four-family residential 10 579 12 1,059 22 1,638 Other residential — — — — — — Commercial real estate 1 85 1 1,726 2 1,811 Commercial business — — — — — — Consumer 26 323 13 64 39 387 38 $ 1,002 26 $ 2,849 64 $ 3,851 December 31, 2020 Restructured Troubled Debt Accruing Restructured Non-accruing Interest Troubled Debt (In Thousands) Commercial real estate $ — $ 646 $ 646 One- to four-family residential 778 1,121 1,899 Other residential — — — Construction — 20 20 Commercial 75 52 127 Consumer 118 511 629 $ 971 $ 2,350 $ 3,321 The following table presents newly restructured loans during the years ended December 31, 2021, 2020, and 2019 by type of modification: 2021 Total Interest Only Term Combination Modification (In Thousands) Residential one-to-four family $ 31 $ 202 $ 134 $ 367 Commercial real estate 1,768 — — 1,768 Commercial business — — — — Consumer — 259 11 270 $ 1,799 $ 461 $ 145 $ 2,405 2020 Total Interest Only Term Combination Modification (In Thousands) Residential one-to-four family $ — $ — $ 1,030 $ 1,030 Commercial real estate — — 559 559 Commercial business — — 22 22 Consumer — 16 1,951 1,967 $ — $ 16 $ 3,562 $ 3,578 2019 Total Interest Only Term Combination Modification (In Thousands) Consumer $ — $ 136 $ — $ 136 $ — $ 136 $ — $ 136 At December 31, 2021, of the $3.9 million in TDRs, $2.9 million were classified as substandard using the Company’s internal grading system. The Company had no TDRs that were modified in the previous 12 months and subsequently defaulted during the year ended December 31, 2021. At December 31, 2020, of the $3.3 million in TDRs, $1.6 million were classified as substandard using the Company’s internal grading system. The Company had no TDRs that were modified in the previous 12 months and subsequently defaulted during the year ended December 31, 2020. Loans were modified during 2020 or 2021 in response to the COVID-19 pandemic and were within the guidance provided by the CARES Act, the federal banking regulatory agencies, the Securities and Exchange Commission and the Financial Accounting Standards Board (FASB). At December 31, 2021, the Company had no remaining modified commercial loans and eight modified consumer and mortgage loans with an aggregate principal balance outstanding of $1.2 million. These balances have decreased from $232.4 million in commercial loans and $18.2 million in consumer and mortgage loans at December 31, 2020. The loan modifications have not been considered TDRs. The Company utilizes an internal risk rating system comprised of a series of grades to categorize loans according to perceived risk associated with the expectation of debt repayment. The analysis of the borrower’s ability to repay considers specific information, including but not limited to current financial information, historical payment experience, industry information, collateral levels and collateral types. A risk rating is assigned at loan origination and then monitored throughout the contractual term for possible risk rating changes. Satisfactory loans range from Excellent to Moderate Risk, but generally are loans supported by strong recent financial statements. Character and capacity of borrower are strong, including reasonable project performance, good industry experience, liquidity and/or net worth. Probability of financial deterioration seems unlikely. Repayment is expected from approved sources over a reasonable period of time. Watch loans are identified when the borrower has capacity to perform according to terms; however, elements of uncertainty exist. Margins of debt service coverage may be narrow, historical patterns of financial performance may be erratic, collateral margins may be diminished and the borrower may be a new and/or thinly capitalized company. Some management weakness may also exist, the borrower may have somewhat limited access to other financial institutions, and that ability may diminish in difficult economic times. Special Mention loans have weaknesses that deserve management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of repayment prospects or the Bank’s credit position at some future date. It is a transitional grade that is closely monitored for improvement or deterioration. The Substandard rating is applied to loans where the borrower exhibits well-defined weaknesses that jeopardize its continued performance and are of a severity that the distinct possibility of default exists. Loans are placed on “non-accrual” when management does not expect to collect payments consistent with acceptable and agreed upon terms of repayment. Doubtful loans have all the weaknesses inherent to those classified Substandard with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, highly questionable and improbable. Loans considered loss are uncollectable and no longer included as an asset. All loans are analyzed for risk rating updates regularly. For larger loans, rating assessments may be more frequent if relevant information is obtained earlier through debt covenant monitoring or overall relationship management. Smaller loans are monitored as identified by the loan officer based on the risk profile of the individual borrower or if th |
