Loans and Allowance for Credit Losses

6 Months Ended

Jun. 30, 2026

Loans Held for Sale

Loans held for sale are comprised entirely of 1-4 family residential mortgage loans as of June 30, 2026 and December 31, 2025. The Company designates loans held for sale as either carried at fair value or the lower of cost or fair value at loan level at origination.

Loans Held for Investment

The following table presents amortized cost and unpaid principal balance of loans, categorized by the segments used in the Company's CECL methodology to assess credit risk, for the periods indicated:


	June 30, 2026			December 31, 2025
(In Thousands)	Amortized Cost	Unpaid Principal	Difference	Amortized Cost	Unpaid Principal	Difference
Commercial & industrial loans	$471,215	$473,342	($2,127)	$450,826	$453,153	($2,327)
Commercial real estate:
Owner occupied properties	443,054	444,880	(1,826)	433,157	435,050	(1,893)
Non-owner occupied and multifamily properties	769,928	774,340	(4,412)	763,180	767,617	(4,437)
Residential real estate:
1-4 family residential properties secured by first liens	260,301	260,371	(70)	243,185	243,167	18
1-4 family residential properties secured by junior liens and revolving secured by 1-4 family first liens	79,995	79,125	870	67,116	66,470	646
1-4 family residential construction loans	28,839	29,053	(214)	39,059	39,311	(252)
Other construction, land development and raw land loans	175,656	177,280	(1,624)	173,589	175,261	(1,672)
Obligations of states and political subdivisions in the US	39,525	39,692	(167)	32,434	32,433	1
Agricultural production, including commercial fishing	55,833	56,118	(285)	47,445	47,682	(237)
Consumer loans	9,877	9,758	119	9,763	9,659	104
Other loans	52,105	52,281	(176)	35,745	35,860	(115)
Total	2,386,328	2,396,240	(9,912)	2,295,499	2,305,663	(10,164)
Allowance for credit losses	(25,461)			(23,737)
Net loans	$2,360,867	$2,396,240	($9,912)	$2,271,762	$2,305,663	($10,164)

The difference between the amortized cost and unpaid principal balance is net deferred origination fees totaling $9.9 million at June 30, 2026 and $10.2 million at December 31, 2025.

Accrued interest on loans, which is excluded from the amortized cost of loans held for investment, totaled $11.0 million and $9.6 million at June 30, 2026 and December 31, 2025, respectively, and is included in other assets in the Consolidated Balance Sheets.

Allowance for Credit Losses

The table below presents activity in the ACL related to loans held for investment for the periods indicated.


Three Months Ended June 30,	Beginning Balance	Credit Loss Expense (Benefit)	Charge-offs	Recoveries	Ending Balance
	(In Thousands)
2026
Commercial & industrial loans	$6,371	($106)	($64)	$27	$6,228
Commercial real estate:
Owner occupied properties	2,498	125	—	—	2,623
Non-owner occupied and multifamily properties	5,252	(66)	(78)	—	5,108
Residential real estate:
1-4 family residential properties secured by first liens	6,220	277	—	—	6,497
1-4 family residential properties secured by junior liens and revolving secured by 1-4 family first liens	1,083	222	—	3	1,308
1-4 family residential construction loans	187	(28)	—	—	159
Other construction, land development and raw land loans	2,615	233	—	—	2,848
Obligations of states and political subdivisions in the US	140	44	—	—	184
Agricultural production, including commercial fishing	212	27	—	1	240
Consumer loans	102	20	—	—	122
Other loans	132	12	—	—	144
Total	$24,812	$760	($142)	$31	$25,461
2025
Commercial & industrial loans	$7,387	$268	($152)	$5	$7,508
Commercial real estate:
Owner occupied properties	2,442	(171)	—	—	2,271
Non-owner occupied and multifamily properties	3,956	227	—	—	4,183
Residential real estate:
1-4 family residential properties secured by first liens	4,056	637	—	—	4,693
1-4 family residential properties secured by junior liens and revolving secured by 1-4 family first liens	769	152	—	7	928
1-4 family residential construction loans	219	51	—	—	270
Other construction, land development and raw land loans	1,706	602	—	—	2,308
Obligations of states and political subdivisions in the US	123	12	—	—	135
Agricultural production, including commercial fishing	187	10	—	—	197
Consumer loans	71	11	(3)	3	82
Other loans	6	4	—	—	10
Total	$20,922	$1,803	($155)	$15	$22,585


Six Months Ended June 30,	Beginning Balance	Credit Loss Expense (Benefit)	Charge-offs	Recoveries	Ending Balance
	(In Thousands)
2026
Commercial & industrial loans	$6,707	($229)	($314)	$64	$6,228
Commercial real estate:
Owner occupied properties	2,207	416	—	—	2,623
Non-owner occupied and multifamily properties	4,440	746	(78)	—	5,108
Residential real estate:
1-4 family residential properties secured by first liens	5,712	785	—	—	6,497
1-4 family residential properties secured by junior liens and revolving secured by 1-4 family first liens	1,041	261	—	6	1,308
1-4 family residential construction loans	324	(165)	—	—	159
Other construction, land development and raw land loans	2,839	9	—	—	2,848
Obligations of states and political subdivisions in the US	143	41	—	—	184
Agricultural production, including commercial fishing	202	37	—	1	240
Consumer loans	114	10	(2)	—	122
Other loans	8	136	—	—	144
Total	$23,737	$2,047	($394)	$71	$25,461
2025
Commercial & industrial loans	$5,800	$1,818	($189)	$79	$7,508
Commercial real estate:
Owner occupied properties	2,944	(673)	—	—	2,271
Non-owner occupied and multifamily properties	3,967	216	—	—	4,183
Residential real estate:
1-4 family residential properties secured by first liens	4,364	329	—	—	4,693
1-4 family residential properties secured by junior liens and revolving secured by 1-4 family first liens	775	139	—	14	928
1-4 family residential construction loans	230	40	—	—	270
Other construction, land development and raw land loans	3,589	(1,281)	—	—	2,308
Obligations of states and political subdivisions in the US	106	29	—	—	135
Agricultural production, including commercial fishing	169	25	—	3	197
Consumer loans	71	24	(16)	3	82
Other loans	5	5	—	—	10
Total	$22,020	$671	($205)	$99	$22,585

The following table shows gross charge-offs by year of loan origination for the periods indicated:


Six Months Ended June 30,

(In Thousands)	2026	2025	2024	2023	2022	Prior	Total
2026
Commercial & industrial loans	$—	$64	$250	$—	$—	$—	$314










Consumer loans	—	—	—	2	—	—	2

Total	$—	$64	$250	$2	$78	$—	$394

Credit Quality Information

As part of the on-going monitoring of the credit quality of the Company’s loan portfolio, management utilizes a loan risk grading system called the Asset Quality Rating (“AQR”) system to assign a risk classification to each of its loans. The risk classification is a dual rating system that contemplates both probability of default and risk of loss given default. Loans are graded on a scale of 1 to 10 and, loans graded 1 – 6 are considered “pass” grade loans. Loans graded 7 or higher are considered “criticized” loans. A description of the general characteristics of the AQR risk classifications are as follows:

Pass grade loans – 1 through 6: The borrower demonstrates sufficient cash flow to fund debt service, including acceptable profit margins, cash flows, liquidity and other balance sheet ratios. Historic and projected performance indicates that the borrower is able to meet obligations under most economic circumstances. The borrower has competent management with an acceptable track record. The category does not include loans with undue or unwarranted credit risks that constitute identifiable weaknesses.

Criticized loans:

Special Mention – 7: A “special mention” credit has weaknesses that deserve management's close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the asset at some future date.

Substandard – 8: A “substandard” credit is inadequately protected by the current worth and paying capacity of the obligor or by the collateral pledged, if any. Assets so classified must have a well-defined weakness, or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the Bank will sustain some loss if the deficiencies are not corrected.

Doubtful – 9: An asset classified “doubtful” has all the weaknesses inherent in one that is classified "substandard-8" with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently known facts, conditions, and values, highly questionable and improbable. The loan has substandard characteristics, and available information suggests that it is unlikely that the loan will be repaid in its entirety.

Loss – 10: An asset classified “loss” is considered uncollectible and of such little value that its continuance on the books is not warranted. This classification does not mean that the asset has absolutely no recovery or salvage value, but rather that it is not practical or desirable to defer writing off this basically worthless asset, even though partial recovery may be affected in the future.

The following tables present the Company's portfolio of risk-rated loans by grade and by year of origination. Management considers the guidance in ASC 310-20 when determining whether a modification, extension, or renewal of loan constitutes a current period origination. Generally, current period renewals of credit are re-underwritten at the point of renewal and considered current period originations for purposes of the table below.


June 30, 2026	2026	2025	2024	2023	2022	Prior	Total
	(In Thousands)
Commercial & industrial loans
Pass	$71,412	$96,278	$64,537	$48,738	$82,868	$76,387	$440,220
Criticized	2,940	740	3,143	5,931	476	17,765	30,995
Total commercial & industrial loans	$74,352	$97,018	$67,680	$54,669	$83,344	$94,152	$471,215

Commercial real estate:
Owner occupied properties
Pass	$35,717	$36,324	$73,217	$43,269	$62,448	$172,799	$423,774


Criticized	—	6,002	—	—	3,601	9,677	19,280
Total commercial real estate owner occupied properties	$35,717	$42,326	$73,217	$43,269	$66,049	$182,476	$443,054

Non-owner occupied and multifamily properties
Pass	$16,772	$122,905	$153,469	$67,754	$136,033	$264,311	$761,244
Criticized	—	—	—	—	1,057	7,627	8,684
Total commercial real estate non-owner occupied and multifamily properties	$16,772	$122,905	$153,469	$67,754	$137,090	$271,938	$769,928

Residential real estate:
1-4 family residential properties secured by first liens
Pass	$57,466	$42,639	$47,485	$70,124	$31,711	$10,188	$259,613
Criticized	—	218	—	307	—	163	688
Total residential real estate 1-4 family residential properties secured by first liens	$57,466	$42,857	$47,485	$70,431	$31,711	$10,351	$260,301

1-4 family residential properties secured by junior liens and revolving secured by 1-4 family first liens
Pass	$14,683	$22,599	$17,911	$9,438	$5,837	$9,018	$79,486
Criticized	—	—	—	429	—	80	509
Total residential real estate 1-4 family residential properties secured by junior liens and revolving secured by 1-4 family first liens	$14,683	$22,599	$17,911	$9,867	$5,837	$9,098	$79,995

1-4 family residential construction loans
Pass	$10,111	$14,511	$1,770	$65	$—	$1,863	$28,320
Criticized	—	519	—	—	—	—	519
Total residential real estate 1-4 family residential construction loans	$10,111	$15,030	$1,770	$65	$—	$1,863	$28,839

Other construction, land development and raw land loans
Pass	$25,341	$61,280	$24,366	$33,650	$13,327	$9,963	$167,927
Criticized	—	—	—	—	6,277	1,452	7,729
Total other construction, land development and raw land loans	$25,341	$61,280	$24,366	$33,650	$19,604	$11,415	$175,656

Obligations of states and political subdivisions in the US
Pass	$—	$11,986	$—	$—	$27,539	$—	$39,525
Criticized	—	—	—	—	—	—	—
Total obligations of states and political subdivisions in the US	$—	$11,986	$—	$—	$27,539	$—	$39,525

Agricultural production, including commercial fishing
Pass	$10,226	$3,207	$7,403	$8,553	$7,974	$17,883	$55,246
Criticized	—	—	587	—	—	—	587
Total agricultural production, including commercial fishing	$10,226	$3,207	$7,990	$8,553	$7,974	$17,883	$55,833

Consumer loans
Pass	$2,656	$3,278	$1,324	$1,290	$409	$915	$9,872
Criticized	—	4	—	—	1	—	5
Total consumer loans	$2,656	$3,282	$1,324	$1,290	$410	$915	$9,877

Other loans
Pass	$13,476	$—	$—	$328	$36,569	$1,732	$52,105
Criticized	—	—	—	—	—	—	—
Total other loans	$13,476	$—	$—	$328	$36,569	$1,732	$52,105

Total loans
Pass	$257,860	$415,007	$391,482	$283,209	$404,715	$565,059	$2,317,332
Criticized	2,940	7,483	3,730	6,667	11,412	36,764	68,996
Total loans	$260,800	$422,490	$395,212	$289,876	$416,127	$601,823	$2,386,328

Total pass loans	$257,860	$415,007	$391,482	$283,209	$404,715	$565,059	$2,317,332
Government guarantees	(22,728)	(10,207)	(34,346)	(5,154)	(4,293)	(27,971)	(104,699)
Total pass loans, net of government guarantees	$235,132	$404,800	$357,136	$278,055	$400,422	$537,088	$2,212,633


Total criticized loans	$2,940	$7,483	$3,730	$6,667	$11,412	$36,764	$68,996
Government guarantees	—	(64)	—	(1,970)	(2,374)	(21,982)	(26,390)
Total criticized loans, net government guarantees	$2,940	$7,419	$3,730	$4,697	$9,038	$14,782	$42,606


December 31, 2025	2025	2024	2023	2022	2021	Prior	Total
	(In Thousands)
Commercial & industrial loans
Pass	$140,717	$73,544	$61,463	$64,841	$24,046	$40,558	$405,169
Criticized	—	3,540	5,905	16,590	12,845	6,777	45,657
Total commercial & industrial loans	$140,717	$77,084	$67,368	$81,431	$36,891	$47,335	$450,826

Commercial real estate:
Owner occupied properties
Pass	$34,589	$70,158	$61,563	$67,334	$52,207	$126,589	$412,440
Criticized	6,002	—	—	3,674	—	11,041	20,717
Total commercial real estate owner occupied properties	$40,591	$70,158	$61,563	$71,008	$52,207	$137,630	$433,157

Non-owner occupied and multifamily properties
Pass	$136,992	$119,749	$68,208	$138,103	$67,826	$221,420	$752,298
Criticized	—	—	—	1,143	—	9,739	10,882
Total commercial real estate non-owner occupied and multifamily properties	$136,992	$119,749	$68,208	$139,246	$67,826	$231,159	$763,180

Residential real estate:
1-4 family residential properties secured by first liens
Pass	$67,166	$53,573	$75,846	$33,276	$2,953	$9,684	$242,498
Criticized	—	—	514	—	—	173	687
Total residential real estate 1-4 family residential properties secured by first liens	$67,166	$53,573	$76,360	$33,276	$2,953	$9,857	$243,185

1-4 family residential properties secured by junior liens and revolving secured by 1-4 family first liens
Pass	$21,690	$18,943	$10,356	$5,820	$2,924	$6,866	$66,599
Criticized	—	—	430	—	—	87	517
Total residential real estate 1-4 family residential properties secured by junior liens and revolving secured by 1-4 family first liens	$21,690	$18,943	$10,786	$5,820	$2,924	$6,953	$67,116

1-4 family residential construction loans
Pass	$23,151	$5,946	$—	$—	$—	$9,962	$39,059
Criticized	—	—	—	—	—	—	—
Total residential real estate 1-4 family residential construction loans	$23,151	$5,946	$—	$—	$—	$9,962	$39,059

Other construction, land development and raw land loans
Pass	$53,248	$45,743	$38,772	$13,462	$9,175	$5,455	$165,855
Criticized	—	—	—	6,277	26	1,431	7,734
Total other construction, land development and raw land loans	$53,248	$45,743	$38,772	$19,739	$9,201	$6,886	$173,589

Obligations of states and political subdivisions in the US
Pass	$—	$4,569	$—	$27,864	$—	$1	$32,434
Criticized	—	—	—	—	—	—	—
Total obligations of states and political subdivisions in the US	$—	$4,569	$—	$27,864	$—	$1	$32,434

Agricultural production, including commercial fishing
Pass	$3,142	$8,770	$7,950	$8,924	$14,908	$3,631	$47,325
Criticized	—	—	—	—	120	—	120
Total agricultural production, including commercial fishing	$3,142	$8,770	$7,950	$8,924	$15,028	$3,631	$47,445

Consumer loans
Pass	$4,757	$1,848	$1,646	$507	$32	$969	$9,759


Criticized	—	—	2	2	—	—	4
Total consumer loans	$4,757	$1,848	$1,648	$509	$32	$969	$9,763

Other loans
Pass	$—	$—	$639	$33,315	$588	$1,203	$35,745
Criticized	—	—	—	—	—	—	—
Total other loans	$—	$—	$639	$33,315	$588	$1,203	$35,745

Total loans
Pass	$485,452	$402,843	$326,443	$393,446	$174,659	$426,338	$2,209,181
Criticized	6,002	3,540	6,851	27,686	12,991	29,248	86,318
Total loans	$491,454	$406,383	$333,294	$421,132	$187,650	$455,586	$2,295,499

Total pass loans	$485,452	$402,843	$326,443	$393,446	$174,659	$426,338	$2,209,181
Government guarantees	(17,804)	(29,791)	(19,923)	(4,766)	(10,173)	(17,368)	(99,825)
Total pass loans, net of government guarantees	$467,648	$373,052	$306,520	$388,680	$164,486	$408,970	$2,109,356

Total criticized loans	$6,002	$3,540	$6,851	$27,686	$12,991	$29,248	$86,318
Government guarantees	—	—	(1,641)	(16,831)	(11,567)	(12,300)	(42,339)
Total criticized loans, net government guarantees	$6,002	$3,540	$5,210	$10,855	$1,424	$16,948	$43,979

Past Due Loans: The following tables present an aging of contractually past due loans as of the periods presented:


(In Thousands)	30-59 Days Past Due	60-89 Days Past Due	Greater Than 90 Days Past Due	Total Past Due	Current	Total	Greater Than 90 Days Past Due Still Accruing
June 30, 2026
Commercial & industrial loans	$19	$—	$451	$470	$470,745	$471,215	$—
Commercial real estate:
Owner occupied properties	—	—	—	—	443,054	443,054	—
Non-owner occupied and multifamily properties	—	—	544	544	769,384	769,928	—
Residential real estate:
1-4 family residential properties secured by first liens	—	874	307	1,181	259,120	260,301	—
1-4 family residential properties secured by junior liens and revolving secured by 1-4 family first liens	274	75	372	721	79,274	79,995	—
1-4 family residential construction loans	—	—		—	28,839	28,839	—
Other construction, land development and raw land loans	—	—	1,654	1,654	174,002	175,656	—
Obligations of states and political subdivisions in the US	—	—	—	—	39,525	39,525	—
Agricultural production, including commercial fishing	—	—	—	—	55,833	55,833	—
Consumer loans	27	4	—	31	9,846	9,877	—
Other loans	—	—	—	—	52,105	52,105	—
Total	$320	$953	$3,328	$4,601	$2,381,727	$2,386,328	$—
December 31, 2025
Commercial & industrial loans	$190	$—	$1,500	$1,690	$449,136	$450,826	$—
Commercial real estate:
Owner occupied properties	—	—	—	—	433,157	433,157	—
Non-owner occupied and multifamily properties	—	—	—	—	763,180	763,180	—
Residential real estate:
1-4 family residential properties secured by first liens	1,505	—	514	2,019	241,166	243,185	—
1-4 family residential properties secured by junior liens and revolving secured by 1-4 family first liens	194	—	372	566	66,550	67,116	—
1-4 family residential construction loans	—	—	—	—	39,059	39,059	—
Other construction, land development and raw land loans	—	277	1,377	1,654	171,935	173,589	—
Obligations of states and political subdivisions in the US	—	—	—	—	32,434	32,434	—
Agricultural production, including commercial fishing	—	—	—	—	47,445	47,445	—
Consumer loans	—	2	—	2	9,761	9,763	—
Other loans	—	—	—	—	35,745	35,745	—
Total	$1,889	$279	$3,763	$5,931	$2,289,568	$2,295,499	$—

Nonaccrual loans: Nonaccrual loans net of government guarantees totaled $21.8 million and $12.0 million at June 30, 2026 and December 31, 2025, respectively. The following table presents loans on nonaccrual status and loans on nonaccrual status for the periods presented for which there was no related ACL. All loans with no ACL are individually evaluated for credit losses in the Company's CECL methodology.


	June 30, 2026			December 31, 2025
(In Thousands)	Nonaccrual	Nonaccrual With No ACL	ACL on Nonaccrual	Nonaccrual	Nonaccrual With No ACL	ACL on Nonaccrual

Commercial & industrial loans	$8,166	$5,354	$1,248	$4,251	$1,641	$1,248
Commercial real estate:
Owner occupied properties	10,844	10,844	—	5,134	2,725	86
Non-owner occupied and multifamily properties	1,601	1,057	47	—	—	—
Residential real estate:
1-4 family residential properties secured by first liens	307	—	43	514	—	60
1-4 family residential properties secured by junior liens and revolving secured by 1-4 family first liens	410	372	1	415	372	1

Other construction, land development and raw land loans	1,654	1,654	—	1,654	1,654	—




Total nonaccrual loans	22,982	19,281	1,339	11,968	6,392	1,395
Government guarantees on nonaccrual loans	(1,171)	(1,171)	—	—	—	—
Net nonaccrual loans	$21,811	$18,110	$1,339	$11,968	$6,392	$1,395

There was $468,000 interest on nonaccrual loans reversed through interest income during the three and six-month periods ending June 30, 2026 and no interest on nonaccrual loans reversed through interest income during the three and six-month periods ending June 30, 2025.

There was no interest earned on nonaccrual loans with a principal balance during the three and six-month periods ending June 30, 2026 and June 30, 2025. However, the Company recognized interest income of $170,000 and $45,000 in the three-month periods ending June 30, 2026 and 2025, respectively, and $238,000 and $87,000 in the six-month periods ending June 30, 2026 and 2025, respectively, related to interest collected on nonaccrual loans whose principal had been paid down to zero.

Loan Modifications: The Company modifies loans to borrowers experiencing financial difficulty as a normal part of our business. These modifications include providing term extensions/modifications, payment modifications, interest rate modifications, or, on rare occasions, principal forgiveness. When principal forgiveness is provided, the amount of forgiveness is charged-off against the ACL. The Company may provide multiple types of concessions on any one loan.

The following table shows the amortized cost basis of the loans that were both experiencing financial difficulty and modified during the periods indicated, by class and type of modification. The percentage of the amortized cost basis of loans that were modified to borrowers experiencing financial difficulty as compared to the amortized cost basis of each class of financing receivable is also presented below:


	Three Months Ended June 30, 2026
	Term Modification	Term and payment modifications	Total Modifications	Percentage of Class of Financing Receivable
(In Thousands)

Commercial real estate:

Non-owner occupied and multifamily properties	$—	$1,057	$1,057	0.14	%









Total	$—	$1,057	$1,057	0.04	%

Three Months Ended June 30, 2025

Payment Modification

Term and payment modifications

Total Modifications

Percentage of Class of Financing Receivable

(In Thousands)

Commercial real estate:

Owner occupied properties

$—

—

Total

$—

—


	Six Months Ended June 30, 2026
	Term Modification	Term and payment modifications	Total Modifications	Percentage of Class of Financing Receivable
(In Thousands)

Commercial real estate:

Non-owner occupied and multifamily properties	$—	$1,057	$1,057	0.14	%









Total	$—	$1,057	$1,057	0.04	%


	Six Months Ended June 30, 2025
	Term Modification	Term and payment modifications	Total Modifications	Percentage of Class of Financing Receivable
(In Thousands)

Commercial real estate:
Owner occupied properties	$—	$3,252	$3,252	0.73	%










Total	$—	$3,252	$3,252	0.15	%

The Company has no outstanding unfunded commitments to the borrowers included in the previous table.

The following table presents the financial effect of the loan modifications presented above to borrowers experiencing financial difficulty as of the dates indicated:


	Three Months Ended June 30, 2026
	Principal Forgiveness	Weighted-Average Interest Rate Reduction		Weighted-Average Term Extension (months)
(In Thousands)

Commercial real estate:

Non-owner occupied and multifamily properties	—	2	%	0


	Three Months Ended June 30, 2025
	Principal Forgiveness	Weighted-Average Interest Rate Reduction		Weighted-Average Term Extension (months)
(In Thousands)

Commercial real estate:

Non-owner occupied and multifamily properties	—	—	%	0


	Six Months Ended June 30, 2026
	Principal Forgiveness	Weighted-Average Interest Rate Reduction		Weighted-Average Term Extension (months)
(In Thousands)

Commercial real estate:

Non-owner occupied and multifamily properties	$—	2	%	0


	Six Months Ended June 30, 2025
	Principal Forgiveness	Weighted-Average Interest Rate Reduction		Weighted-Average Term Extension (months)
(In Thousands)
Commercial & industrial loans	$—	—	%	33

The following table presents the amortized cost basis of loans to borrowers experiencing financial difficulty as of the dates indicated. These are loans that have been modified within twelve months of the dates indicated:


(In Thousands)	June 30, 2026	December 31, 2025
Commercial & industrial loans	$208	$142
Commercial real estate:
Owner occupied properties	3,128	3,193

Residential real estate:

1-4 family residential properties secured by junior liens and revolving secured by 1-4 family first liens	372	372
1-4 family residential construction loans	—	—
Other construction, land development and raw land loans	1,376	1,376




Total	$6,141	$5,083

The following table presents the amortized cost basis of loans that had a payment default during the periods indicated and were modified in the twelve months before default to borrowers experiencing financial difficulty:


	Three Months Ended June 30, 2026		Six Months Ended June 30, 2026
	Term modification	Term and payment modification	Term modification	Term and payment modification
(In Thousands)

Commercial real estate:
Owner occupied properties	$—	$—	$—	$703

Residential real estate:

1-4 family residential properties secured by junior liens and revolving secured by 1-4 family first liens	372	—	372	—

Other construction, land development and raw land loans	1,376	—	1,376	—




Total	$1,748	$—	$1,748	$703

Three Months Ended June 30, 2025

Six Months Ended June 30, 2025

Term and payment modification

(In Thousands)

Commercial real estate:

Owner occupied properties

$—

$3,252

Total

$—

$3,252

The Company monitors the performance of loans that are modified to borrowers experiencing financial difficulty to understand the effectiveness of its modification efforts. The following table presents the payment performance of loans that have been modified in the last twelve months as of the date indicated:


	June 30, 2026
	Greater Than 89 Days Past Due	Total Past Due	Current	Total
(In Thousands)
Commercial & industrial loans	$—	$—	$208	$208
Commercial real estate:
Owner occupied properties	—	—	3,128	3,128

Residential real estate:

1-4 family residential properties secured by junior liens and revolving secured by 1-4 family first liens	372	372	—	372

Other construction, land development and raw land loans	1,376	1,376	—	1,376




Total	$1,748	$1,748	$4,393	$6,141


	June 30, 2025
	Greater Than 89 Days Past Due	Total Past Due	Current	Total
(In Thousands)
Commercial & industrial loans	$—	$—	$768	$768
Commercial real estate:
Owner occupied properties	217	217	3,251	3,468

Residential real estate:

1-4 family residential properties secured by junior liens and revolving secured by 1-4 family first liens	372	372	—	372

Other construction, land development and raw land loans	1,490	1,490	—	1,490




Total	$2,079	$2,079	$4,019	$6,098

Upon the Company's determination that a modified loan (or a portion of a loan) has subsequently been deemed uncollectible, the loan (or a portion of the loan) is written off. Therefore, the amortized cost basis of the loan is reduced by the uncollectible amount and the ACL is adjusted by the same amount.