The following tables present, by portfolio segment, the changes in the allowance for credit losses ("ACL") for the three and six months ended June 30, 2026.

Allowance for credit losses:


For the three months ended June 30, 2026	Beginning balance		Charge-offs			Recoveries		Provision			Ending Balance
Commercial & Agriculture	$	4,996	$	(2	)	$	34	$	2,296		$	7,324
Commercial Real Estate:
Owner Occupied		4,280		—			2		79			4,361
Non-Owner Occupied		11,789		—			1		(1,125	)		10,665
Residential Real Estate		14,486		(27	)		21		(378	)		14,102
Real Estate Construction		3,502		—			—		338			3,840
Farm Real Estate		225		—			—		1			226
Lease Financing Receivables		1,008		(138	)		40		49			959
Consumer and Other		250		(7	)		2		(9	)		236
Total	$	40,536	$	(174	)	$	100	$	1,251		$	41,713


For the six months ended June 30, 2026	Beginning balance		Charge-offs			Recoveries		Provision			Ending Balance
Commercial & Agriculture	$	5,153	$	(98	)	$	96	$	2,173		$	7,324
Commercial Real Estate:
Owner Occupied		4,420		—			3		(62	)		4,361
Non-Owner Occupied		12,118		(484	)		2		(971	)		10,665
Residential Real Estate		14,718		(30	)		34		(620	)		14,102
Real Estate Construction		3,842		—			—		(2	)		3,840
Farm Real Estate		279		—			—		(53	)		226
Lease Financing Receivables		1,169		(348	)		44		94			959
Consumer and Other		321		(20	)		11		(76	)		236
Total	$	42,020	$	(980	)	$	190	$	483		$	41,713

For the three and six months ended June 30, 2026, the Company provided $1,251 and $483, respectively, to the allowance for credit losses. The Company experienced an increase in the allowance for credit losses as required by our CECL model due to quantitative factors representing an increase due to geopolitical uncertainties in addition to less charge-offs experienced in the respective periods. The provision recorded in the three months ended June 30, 2026, was elevated due to an increase in the quantitative factors affecting the Commercial & Agriculture portfolio, requiring an additional expense.

For the three and six months ended June 30, 2025, the Company provided $1,171 and $2,419, respectively, to the allowance for credit losses. The Company experienced an increase in the allowance for credit losses as required by our CECL model due to quantitative factors representing an increase in the forecasted unemployment rate, and an increase in forecasted probability of default and lower prepayment speeds as well as loan growth during the period.

Homogeneous loans, generally Residential Real Estate, Real Estate Construction, and Consumer and Other loans, are not risk-graded, except when collateral is used for a business purpose. These loans are monitored based on performance, with performing loans included as Pass and nonperforming loans included as Substandard.

Based on the most recent analysis performed, the risk category of loans at June 30, 2026, and year-to-date gross charge-offs as of June 30, 2026, by type and year of originations, was as follows:


	Term Loans Amortized Cost Basis by Origination Year


													Revolving
	2026		2025		2024		2023		2022		Prior		Loans		Total
Commercial & Agriculture
Pass	$	39,432	$	43,532	$	41,263	$	30,800	$	17,255	$	16,930	$	100,567	$	289,779
Special Mention		—		1,161		252		177		965		1,978		6,941		11,476
Substandard		56		517		4,705		1,021		520		67		5,999		12,886
Doubtful		—		—		—		—		—		—		1,338		1,338
Total Commercial & Agriculture	$	39,488	$	45,210	$	46,220	$	31,999	$	18,740	$	18,976	$	114,846	$	315,479
Commercial & Agriculture:
Current-period gross charge-offs	$	—	$	—	$	76	$	22	$	—	$	—	$	—	$	98

Commercial Real Estate - Owner Occupied
Pass	$	19,790	$	52,767	$	31,012	$	34,756	$	52,135	$	157,934	$	10,985	$	359,379
Special Mention		—		—		—		—		9,045		4,216		—		13,261
Substandard		—		543		942		1,156		6,442		6,260		1,451		16,793
Doubtful		—		—		—		—		—		—		—		—
Total Commercial Real Estate - Owner Occupied	$	19,790	$	53,310	$	31,954	$	35,912	$	67,622	$	168,409	$	12,436	$	389,434
Commercial Real Estate - Owner Occupied:
Current-period gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

Commercial Real Estate - Non-Owner Occupied
Pass	$	65,234	$	78,375	$	76,166	$	254,114	$	257,392	$	422,980	$	30,847	$	1,185,108
Special Mention		—		—		—		—		3,057		12,752		—		15,808
Substandard		—		—		1,434		—		377		27,004		—		28,815
Doubtful		—		—		—		—		—		—		—		—
Total Commercial Real Estate - Non-Owner Occupied	$	65,234	$	78,375	$	77,600	$	254,114	$	260,826	$	462,736	$	30,847	$	1,229,731
Commercial Real Estate - Non-Owner Occupied:
Current-period gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	484	$	—	$	484

Residential Real Estate
Pass	$	57,172	$	99,933	$	121,131	$	115,759	$	110,629	$	240,308	$	204,493	$	949,425
Special Mention		—		—		6		—		124		195		—		325
Substandard		—		—		—		1,631		1,626		3,923		1,030		8,210
Doubtful		—		—		—		—		—		—		—		—
Total Residential Real Estate	$	57,172	$	99,933	$	121,137	$	117,390	$	112,379	$	244,425	$	205,523	$	957,960
Residential Real Estate:
Current-period gross charge-offs	$	—	$	—	$	—	$	—	$	21	$	9	$	—	$	30




													Revolving
	2026		2025		2024		2023		2022		Prior		Loans		Total
Real Estate Construction
Pass	$	65,300	$	104,044	$	12,304	$	34,400	$	16,804	$	9,240	$	15,184	$	257,275
Special Mention		—		—		7,528		—		—		—		—		7,528
Substandard		—		—		—		684		—		—		—		684
Doubtful		—		—		—		—		—		—		—		—
Total Real Estate Construction	$	65,300	$	104,044	$	19,832	$	35,084	$	16,804	$	9,240	$	15,184	$	265,488
Real Estate Construction:
Current-period gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

Farm Real Estate
Pass	$	2,364	$	1,050	$	856	$	2,329	$	482	$	18,783	$	3,127	$	28,992
Special Mention		—		—		—		—		439		808		1,695		2,942
Substandard		—		—		—		—		—		507		—		507
Doubtful		—		—		—		—		—		—		—		—
Total Farm Real Estate	$	2,364	$	1,050	$	856	$	2,329	$	920	$	20,098	$	4,822	$	32,440
Farm Real Estate:
Current-period charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

Lease Financing Receivables
Pass	$	6,176	$	4,414	$	6,410	$	5,362	$	1,608	$	194	$	—	$	24,165
Special Mention		—		1,690		2,578		1,067		349		—		—		5,684
Substandard		—		—		1,296		1,257		264		—		—		2,816
Doubtful		—		—		-		—		—		—		—		—
Total Lease Financing Receivables	$	6,176	$	6,104	$	10,283	$	7,687	$	2,221	$	194	$	—	$	32,665
Lease Financing Receivables:
Current-period charge-offs	$	—	$	—	$	115	$	164	$	69	$	—	$	—	$	348

Consumer and Other
Pass	$	880	$	23,172	$	1,098	$	1,837	$	1,014	$	651	$	3,007	$	31,657
Special Mention		—		—		—		—		—		—		—		—
Substandard		—		10		1		10		16		13		—		51
Doubtful		—		—		—		—		—		—		—		—
Total Consumer and Other	$	880	$	23,182	$	1,099	$	1,847	$	1,030	$	663	$	3,007	$	31,707
Consumer and Other:
Current-period charge-offs	$	—	$	—	$	6	$	5	$	—	$	9	$	—	$	20
Total Loans	$	256,404	$	411,208	$	308,982	$	486,362	$	480,542	$	924,741	$	386,666	$	3,254,904
Total Loans:
Current-period charge-offs	$	—	$	—	$	197	$	191	$	90	$	502	$	—	$	980

The risk category of loans at December 31, 2025, and year-to-date gross charge-offs as of June 30, 2025, by type and year of originations, was as follows:


	Term Loans Amortized Cost Basis by Origination Year


													Revolving
	2025		2024		2023		2022		2021		Prior		Loans		Total
Commercial & Agriculture
Pass	$	55,108	$	49,767	$	32,413	$	21,623	$	15,222	$	8,323	$	100,299	$	282,755
Special Mention		686		—		331		1,142		2,426		61		7,381		12,027
Substandard		506		4,677		1,267		619		8		—		5,325		12,402
Doubtful		—		—		—		—		—		—		1,508		1,508
Total Commercial & Agriculture	$	56,300	$	54,444	$	34,011	$	23,384	$	17,656	$	8,384	$	114,513	$	308,692
Commercial & Agriculture:
Current-period gross charge-offs	$	—	$	—	$	383	$	42	$	10	$	—	$	—	$	435

Commercial Real Estate - Owner Occupied
Pass	$	41,259	$	32,982	$	41,997	$	55,380	$	54,209	$	120,299	$	6,347	$	352,473
Special Mention		330		—		1,010		14,290		5,275		1,539		75		22,519
Substandard		—		—		1,514		2,930		—		4,617		1,494		10,555
Doubtful		—		—		—		—		—		—		—		—
Total Commercial Real Estate - Owner Occupied	$	41,589	$	32,982	$	44,521	$	72,600	$	59,484	$	126,455	$	7,916	$	385,547
Commercial Real Estate - Owner Occupied:
Current-period gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

Commercial Real Estate - Non-Owner Occupied
Pass	$	64,507	$	77,375	$	259,428	$	295,520	$	143,207	$	329,652	$	31,946	$	1,201,635
Special Mention		—		950		—		1,520		—		7,036		—		9,506
Substandard		—		—		—		—		14,593		12,799		—		27,392
Doubtful		—		—		—		—		—		484		—		484
Total Commercial Real Estate - Non-Owner Occupied	$	64,507	$	78,325	$	259,428	$	297,040	$	157,800	$	349,971	$	31,946	$	1,239,017
Commercial Real Estate - Non-Owner Occupied:
Current-period gross charge-offs	$	—	$	—	$	—	$	—	$	800	$	550	$	—	$	1,350

Residential Real Estate
Pass	$	98,026	$	145,132	$	126,021	$	114,905	$	91,029	$	160,969	$	198,707	$	934,789
Special Mention		139		55		—		—		551		270		350		1,365
Substandard		—		—		433		1,513		534		3,024		1,134		6,638
Doubtful		—		1,020		—		—		—		—		516		1,536
Total Residential Real Estate	$	98,165	$	146,207	$	126,454	$	116,418	$	92,114	$	164,263	$	200,707	$	944,328
Residential Real Estate:
Current-period gross charge-offs	$	—	$	—	$	—	$	40	$	39	$	36	$	—	$	115


	Term Loans Amortized Cost Basis by Origination Year


													Revolving
	2025		2024		2023		2022		2021		Prior		Loans		Total
Real Estate Construction
Pass	$	116,268	$	39,988	$	75,744	$	23,121	$	4,041	$	7,282	$	11,304	$	277,748
Special Mention		—		6,678		—		—		—		—		—		6,678
Substandard		—		—		711		—		—		—		—		711
Doubtful		—		—		—		—		—		—		—		—
Total Real Estate Construction	$	116,268	$	46,666	$	76,455	$	23,121	$	4,041	$	7,282	$	11,304	$	285,137
Real Estate Construction:
Current-period gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

Farm Real Estate
Pass	$	2,220	$	1,606	$	2,710	$	1,709	$	2,600	$	20,683	$	3,133	$	34,661
Special Mention		—		—		450		461		—		679		1,027		2,617
Substandard		—		—		—		—		22		475		—		497
Doubtful		—		—		—		—		—		—		—		—
Total Farm Real Estate	$	2,220	$	1,606	$	3,160	$	2,170	$	2,622	$	21,837	$	4,160	$	37,775
Farm Real Estate:
Current-period charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

Lease Financing Receivables
Pass	$	7,631	$	7,361	$	7,292	$	3,193	$	486	$	21	$	—	$	25,984
Special Mention		1,799		3,035		2,340		39		—		—		—		7,213
Substandard		43		1,363		235		265		—		—		—		1,906
Doubtful		—		—		-		—		—		—		—		-
Total Lease Financing Receivables	$	9,473	$	11,759	$	9,867	$	3,497	$	486	$	21	$	—	$	35,103
Lease Financing Receivables:
Current-period charge-offs	$	—	$	—	$	—	$	152	$	—	$	—	$	—	$	152

Consumer and Other
Pass	$	24,261	$	3,717	$	2,428	$	1,416	$	662	$	404	$	1,504	$	34,392
Special Mention		—		—		—		—		—		—		3		3
Substandard		—		9		13		16		14		—		—		52
Doubtful		—		—		—		—		—		—		—		—
Total Consumer and Other	$	24,261	$	3,726	$	2,441	$	1,432	$	676	$	404	$	1,507	$	34,447
Consumer and Other:
Current-period charge-offs	$	—	$	—	$	5	$	5	$	5	$	1	$	—	$	16
Total Loans	$	412,783	$	375,715	$	556,337	$	539,662	$	334,879	$	678,617	$	372,053	$	3,270,046
Total Loans:
Current-period charge-offs	$	—	$	—	$	388	$	239	$	854	$	587	$	—	$	2,068

The following tables include an aging analysis of the recorded investment in past due loans outstanding as of June 30, 2026 and December 31, 2025.


June 30, 2026	30-59 Days Past Due		60-89 Days Past Due		90 Days or Greater Past Due		Total Past Due		Current		Total Loans		Past Due 90 Days and Accruing
Commercial & Agriculture	$	151	$	75	$	477	$	703	$	314,776	$	315,479	$	—
Commercial Real Estate:
Owner Occupied		—		—		7		7		389,427		389,434		—
Non-Owner Occupied		472		—		9,900		10,372		1,219,359		1,229,731		—
Residential Real Estate		1,149		1,741		3,339		6,229		951,731		957,960		—
Real Estate Construction		—		—		—		—		265,488		265,488		—
Farm Real Estate		—		—		—		—		32,440		32,440		—
Lease Financing Receivables		211		464		103		778		31,887		32,665		103
Consumer and Other		57		5		27		89		31,618		31,707		—
Total	$	2,040	$	2,285	$	13,853	$	18,178	$	3,236,726	$	3,254,904	$	103


December 31, 2025	30-59 Days Past Due		60-89 Days Past Due		90 Days or Greater Past Due		Total Past Due		Current		Total Loans		Past Due 90 Days and Accruing
Commercial & Agriculture	$	382	$	239	$	141	$	762	$	307,930	$	308,692	$	—
Commercial Real Estate:
Owner Occupied		179		—		6		185		385,362		385,547		23
Non-Owner Occupied		8,332		—		1,130		9,462		1,229,555		1,239,017		—
Residential Real Estate		5,954		1,629		2,331		9,914		934,414		944,328		104
Real Estate Construction		—		—		—		—		285,137		285,137		—
Farm Real Estate		—		—		—		—		37,775		37,775		—
Lease Financing Receivables		1,301		1,240		454		2,995		32,108		35,103		335
Consumer and Other		115		37		47		199		34,248		34,447		—
Total	$	16,263	$	3,145	$	4,109	$	23,517	$	3,246,529	$	3,270,046	$	462

Nonaccrual Loans: Loans are considered for nonaccrual status upon reaching 90 days delinquency, unless the loan is well secured and in the process of collection, although the Company may be receiving partial payments of interest and partial repayments of principal on such loans. When a loan is placed on nonaccrual status, previously accrued but unpaid interest is deducted from interest income. Payments received on nonaccrual loans are applied to the unpaid principal balance. A loan may be returned to accruing status only if one of two conditions are met: (1) the loan is well-secured and none of the principal and interest has been past due for a minimum of 90 days or (2) the principal and interest payments are reasonably assured and a sustained period of performance has occurred, generally six months.

Modifications to Borrowers Experiencing Financial Difficulty: Occasionally, the Company modifies loans by providing principal forgiveness on certain of its real estate loans. When principal forgiveness is provided, the amortized cost basis of the loan is written off against the allowance for credit losses. The amount of the principal forgiveness is deemed to be uncollectible; therefore, that portion of the loan is written off, resulting in a reduction of amortized cost basis and a corresponding adjustments to the allowance for credit losses. In some cases, the Company will modify a certain loan by providing multiple types of concessions. Typically, one type of concession, such as a term extension, is granted initially. If the borrower continues to experience financial difficulty, another concession, such as principal forgiveness, reduction of rate or payment deferral, may be granted. The allowance for credit losses incorporates an estimate of lifetime expected credit losses and is recorded on each loan upon loan origination or acquisition. The starting point for the estimate of the allowance for credit losses is historical loss information, which includes losses from modifications of loans to borrowers experiencing financial difficulty. The Company uses probability of default/loss given default, discounted cash flows or remaining life method to determine the allowance for credit losses. An assessment of whether a borrower is experiencing financial difficulty is made on the date of a modification. Because the effect of most modifications made to borrowers experiencing financial difficulty is already included in the allowance for credit losses because of the measurement methodologies used to estimate the allowance, a change to the allowance for credit losses is generally not recorded upon modification.

The following table shows the amortized cost basis at the end of the reporting period of the loans modified to borrowers experiencing financial difficulty, disaggregated by loan category and type of modification granted during the six months ended June 30, 2026. There were no loans modified to a borrower experiencing financial difficulty during the three months ended June 30, 2026. 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 loan category is presented below:


	Loans Modifications Made to Borrowers Experiencing Financial Difficulty
	For the six months ended June 30, 2026
	(Dollars in Thousands)
	Term Extension
Loan Type	Amortized Cost Basis		Percent of total loans by category
Commercial & Agriculture	$	—		—
Commercial Real Estate:
Owner Occupied		—		—
Non-Owner Occupied		—		—
Residential Real Estate		—		—
Real Estate Construction		—		—
Farm Real Estate		—		—
Lease Financing Receivables		514		1.61	%
Consumer and Other		—		—
Total Loan Modifications	$	514

The following tables show the amortized cost basis at the end of the reporting period of the loans modified to borrowers experiencing financial difficulty, disaggregated by loan category and type of modification granted during the three and six months ended June 30, 2025. 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 loan category is presented below:


	Loans Modifications Made to Borrowers Experiencing Financial Difficulty
	For the three months ended June 30, 2025
	(Dollars in Thousands)
	Term Extension
Loan Type	Amortized Cost Basis		Percent of total loans by category
Commercial & Agriculture	$	7		0.00	%
Commercial Real Estate:
Owner Occupied		—		—
Non-Owner Occupied		—		—
Residential Real Estate		—		—
Real Estate Construction		—		—
Farm Real Estate		—		—
Leasing Financing Receivables		—		—
Consumer and Other		—		—
Total Loan Modifications	$	7

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 allowance for credit losses is adjusted by the same amount. The Company closely monitors the performance of the loans that were modified to borrowers experiencing financial difficulty to understand the effectiveness of its modification efforts. There were no

modified loans that had a payment default during the three and six months ended June 30, 2026 and June 30, 2025, and were modified during the twelve months prior to that default to borrowers experiencing financial difficulty.

The following tables present the payment status of the loans that were modified to borrowers experiencing financial difficulties in the last twelve months ended June 30, 2026 and June 30, 2025.


June 30, 2026	30-59 Days Past Due		60-89 Days Past Due		90 Days or Greater Past Due		Total Past Due		Current		Non-Accrual
Commercial & Agriculture	$	—	$	—	$	—	$	—	$	5,574	$	5,539
Commercial Real Estate:
Owner Occupied		—		—		—		—		—		—
Non-Owner Occupied		—		—		—		—		—		—
Residential Real Estate		—		—		—		—		—		—
Real Estate Construction		—		—		—		—		—		—
Farm Real Estate		—		—		—		—		—		—
Lease Financing Receivables		—		—		—		—		514		—
Consumer and Other		—		—		—		—		—		—
Total	$	—	$	—	$	—	$	—	$	6,088	$	5,539


June 30, 2025	30-59 Days Past Due		60-89 Days Past Due		90 Days or Greater Past Due		Total Past Due		Current		Non-Accrual
Commercial & Agriculture	$	—	$	—	$	7	$	7	$	7,559	$	7,566
Commercial Real Estate:
Owner Occupied		—		—		—		—		—		—
Non-Owner Occupied		—		—		484		484		—		484
Residential Real Estate		—		—		—		—		—		—
Real Estate Construction		—		—		—		—		—		—
Farm Real Estate		—		—		—		—		—		—
Lease Financing Receivables		—		—		—		—		—		—
Consumer and Other		—		—		—		—		—		—
Total	$	—	$	—	$	491	$	491	$	7,559	$	8,050

Individually Evaluated Loans: Larger (greater than $350) Commercial & Agricultural and Commercial Real Estate loan relationships, as well as Residential Real Estate and Consumer loans and Lease Financing Receivables that are part of a larger relationship are individually evaluated on a quarterly basis, when they do not share similar risk characteristics with the collectively evaluated pools. These loans are analyzed to determine if it is probable that all amounts will not be collected according to the contractual terms of the loan agreement. If management determines that the value of the loan is less than the recorded investment in the loan (net of previous charge-offs, deferred loan fees or costs and unamortized premium or discount), impairment is recognized through an allowance estimate or a charge-off to the allowance. The Company’s policy for recognizing interest income on individually evaluated loans does not differ from its overall policy for interest recognition.

The following tables present the amortized cost basis of collateral dependent loans, which are individually evaluated to determine expected credit losses, and the related allowance for credit losses allocated to these loans as of June 30, 2026 and December 31, 2025.


June 30, 2026	Real Estate		Other		Allowance for Credit Losses
Commercial & Agriculture	$	—	$	2,418	$	1,339
Commercial Real Estate:
Owner Occupied		1,377		—		—
Non-Owner Occupied		8,466		—		2,000
Residential Real Estate		471		—		—
Real Estate Construction		—		—		—
Farm Real Estate		343		—		—
Lease Financing Receivables		—		—		—
Consumer and Other		—		—		—
Total	$	10,657	$	2,418	$	3,339



December 31, 2025	Real Estate		Other		Allowance for Credit Losses
Commercial & Agriculture	$	—	$	2,687	$	248
Commercial Real Estate:
Owner Occupied		2,778		—		—
Non-Owner Occupied		9,010		—		3,000
Residential Real Estate		1,536		—		—
Real Estate Construction		—		—		—
Farm Real Estate		377		—		—
Lease Financing Receivables		—		119		119
Consumer and Other		—		—		—
Total	$	13,701	$	2,806	$	3,367

Collateral-dependent loans consist primarily of Residential Real Estate, Commercial Real Estate and Commercial & Agricultural loans. Individually evaluated loans are collateral-dependent when foreclosure is probable or when the repayment of the loan is expected to be provided substantially through the operation or sale of the underlying collateral. When a loan is deemed collateral-dependent, the level of credit loss is measured by the difference between amortized cost of the loan and the fair value of collateral adjusted for estimated cost to sell. In the case of Commercial & Agricultural loans secured by equipment, the fair value of the collateral is estimated by third-party valuation experts. Loan balances are charged down to the underlying collateral value when they are deemed uncollectible. Note that the Company did not elect to use the collateral maintenance agreement practical expedient available under CECL.

Foreclosed assets acquired in settlement of loans are carried at fair value less estimated costs to sell and are included in Other assets on the Consolidated Balance Sheets. As of June 30, 2026 and December 31, 2025, there were no foreclosed assets included in other assets. As of June 30, 2026 and December 31, 2025, the Company had initiated formal foreclosure procedures on $3,142 and $1,228, respectively, of Residential Real Estate loans.

The Company estimates expected credit losses over the contractual period in which the Company is exposed to credit risk from a contractual obligation to extend credit, such as a loan commitment, credit line, letter of credit, or overdraft protection. The allowance for credit losses on off-balance sheet credit exposures is recorded within Accrued expenses and other liabilities on the Consolidated Balance Sheets with adjustments recorded in Provision for credit losses on the Consolidated Statements of Operations. The estimated credit loss includes consideration of the likelihood that funding will occur and an estimate of expected credit losses on commitments expected to be funded over its estimated life. The estimate of expected credit loss is based on the historical loss rate for the loan class in which the loan commitments would be classified if funded.