v3.26.1
Loans and Allowance for Credit Losses
 6 Months Ended
Jun. 30, 2026
Receivables [Abstract]  
Loans and Allowance for Credit Losses Loans and Allowance for Credit Losses
Loans
Major classifications within the Company’s loans held for investment portfolio at June 30, 2026 and December 31, 2025 were as follows:
(dollars in thousands)June 30, 2026December 31, 2025
Commercial, financial, and agricultural$196,084 $227,584 
Real estate construction − residential42,30739,609
Real estate construction − commercial85,91483,846
Real estate mortgage − residential370,185369,636
Real estate mortgage − commercial712,619755,892
Installment and other consumer9,25110,225
Total loans held for investment$1,416,360 $1,486,792 
The Bank grants real estate, commercial, installment, and other consumer loans to customers located within the Missouri communities surrounding Jefferson City, Columbia, Clinton, Warsaw, Springfield, and the greater Kansas City metropolitan area. As such, the Bank is susceptible to changes in the economic environment in these communities. The Bank does not have a concentration of credit in any one geographic sector. Accrued interest on loans totaled $5.9 million and $6.8 million at June 30, 2026 and December 31, 2025, respectively, and is included in accrued interest receivable and other assets on the Company's consolidated balance sheets. The total amount of accrued interest is excluded from the amortized cost basis of loans presented above. Further, the Company has elected not to measure an allowance for credit losses for accrued interest receivable. At June 30, 2026, loans of $707.7 million were pledged to the Federal Home Loan Bank (“FHLB”) as collateral for borrowings and letters of credit.
Allowance for Credit Losses
The allowance for credit losses is measured using a lifetime expected loss model that 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 type and expected credit loss patterns. Loans that do not share similar risk characteristics, primarily large loans on non-accrual status, are evaluated on an individual basis. The allowance for credit losses is a valuation account that is deducted from loans amortized cost basis to present the net amount
expected to be collected on the instrument. Expected recoveries are included in the allowance and do not exceed the aggregate of amounts previously charged-off and expected to be charged-off. Loans are charged off against the allowance for credit losses when management believes the balance has become uncollectible.
Allowance for Credit Losses on Off-Balance-Sheet Credit Exposures
The Company maintains a separate allowance for credit losses for off-balance-sheet credit exposures, including unfunded loan commitments, unless the associated obligation is unconditionally cancellable by the Company. This allowance is included in other liabilities on the consolidated balance sheets with associated expense recognized as a component of the provision for credit losses on the consolidated statements of income. 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 an assumption for the portion of unfunded commitments that are expected to be funded. The allowance for credit losses on unfunded commitments totaled $1.5 million and $1.0 million at June 30, 2026 and December 31, 2025, respectively.
Sensitivity in the Allowance for Credit Loss Model
The allowance for credit losses is an estimate that requires significant judgment including projections of the macroeconomic environment. The forecasted macroeconomic environment continuously changes, which can cause fluctuations in estimated expected losses.
The following tables illustrate the changes in the allowance for credit losses on loans by portfolio segment:
Three Months Ended June 30, 2026
(dollars in thousands)Commercial, Financial, & AgriculturalReal Estate Construction - ResidentialReal Estate Construction - CommercialReal Estate Mortgage - ResidentialReal Estate Mortgage - CommercialInstallment and Other ConsumerUn- allocatedTotal
Allowance for Credit Losses on Loans
Balance at beginning of period$4,329 $1,047 $1,900 $4,389 $9,172 $96 $— $20,933 
Charge-offs(185)— — — (2)(56)— (243)
Recoveries48 — 22 5 1 29 — 105 
Provision for (release of) credit losses(564)(6)299 163 (143)24 162 (65)
Balance at end of period$3,628 $1,041 $2,221 $4,557 $9,028 $93 $162 $20,730 
Six Months Ended June 30, 2026
(dollars in thousands)Commercial, Financial, & AgriculturalReal Estate Construction - ResidentialReal Estate Construction - CommercialReal Estate Mortgage - ResidentialReal Estate Mortgage - CommercialInstallment and Other ConsumerUn- allocatedTotal
Allowance for Credit Losses on Loans
Balance at beginning of period$3,655 $975 $1,719 $4,823 $9,839 $100 $— $21,111 
Charge-offs(195)— — — (25)(116)— (336)
Recoveries52 — 22 10 1 55 — 140 
Provision for (release of) credit losses116 66 480 (276)(787)54 162 (185)
Balance at end of period$3,628 $1,041 $2,221 $4,557 $9,028 $93 $162 $20,730 
Three Months Ended June 30, 2025
(dollars in thousands)Commercial, Financial, & AgriculturalReal Estate Construction - ResidentialReal Estate Construction - CommercialReal Estate Mortgage - ResidentialReal Estate Mortgage - CommercialInstallment and Other ConsumerUn- allocatedTotal
Allowance for Credit Losses on Loans
Balance at beginning of period$1,447 $583 $1,667 $5,134 $12,608 $117 $224 $21,780 
Charge-offs(21)— — (8)(3)(109)— (141)
Recoveries34 — — 12 — 44 — 90 
Provision for (release of) credit losses684 (255)(183)(221)(213)60 (31)(159)
Balance at end of period$2,144 $328 $1,484 $4,917 $12,392 $112 $193 $21,570 
Six Months Ended June 30, 2025
(dollars in thousands)Commercial, Financial, & AgriculturalReal Estate Construction - ResidentialReal Estate Construction - CommercialReal Estate Mortgage - ResidentialReal Estate Mortgage - CommercialInstallment and Other ConsumerUn- allocatedTotal
Allowance for Credit Losses on Loans
Balance at beginning of period$1,560 $578 $2,221 $5,310 $12,305 $138 $(68)$22,044 
Charge-offs(34)— — (14)(36)(199)— (283)
Recoveries102 — — 19 58 71 — 250 
Provision for (release of) credit losses516 (250)(737)(398)65 102 261 (441)
Balance at end of period$2,144 $328 $1,484 $4,917 $12,392 $112 $193 $21,570 


Collateral-Dependent loans
Collateral-dependent loans are loans for which the repayment is expected to be provided substantially through the operation or sale of the collateral and the borrower is experiencing financial difficulty. Under the CECL methodology, for collateral-dependent loans, the Company has adopted the practical expedient to measure the allowance on the fair value of collateral.
The allowance is calculated on an individual loan basis based on the shortfall between the fair value of the loan’s collateral, which is adjusted for liquidation costs/discounts, and the loan’s amortized cost. If the fair value of the collateral exceeds the loan’s amortized cost, no allowance is necessary. The Company’s policy is to obtain current appraisals on any
significant pieces of collateral. Higher discounts are applied in determining fair value for real estate collateral in industries that are undergoing significant stress, or for properties that are specialized use or have limited marketability.
There have been no significant changes to the types of collateral securing the Company's collateral-dependent loans since December 31, 2025.

The amortized cost of collateral-dependent loans by class as of June 30, 2026 and December 31, 2025 was as follows:
Collateral Type
(dollars in thousands)Real EstateOtherAllowance Allocated
June 30, 2026
Commercial, financial, and agricultural$— $3,690 $2,066 
Real estate mortgage − residential1,289 — 35 
Real estate mortgage − commercial1,332 — 278 
Total$2,621 $3,690 $2,379 
December 31, 2025
Commercial, financial, and agricultural$— $3,558 $1,477 
Real estate mortgage − residential3,914 — 432 
Total$3,914 $3,558 $1,909 
Credit Quality
The Company categorizes loans into risk categories based upon an internal rating system reflecting management’s risk assessment.
•Pass - loans that are well protected by the current net worth and paying capacity of the obligor (or guarantors, if any) or by the fair value, less cost to acquire and sell in a timely manner, of any underlying collateral.
•Watch - loans that have one or more weaknesses identified that may result in the borrower being unable to meet repayment terms or when the Company’s credit position could deteriorate at some future date.
•Special Mention - loans that have negative financial trends, or other weaknesses that if left uncorrected, could threaten the borrower’s capacity to meet its debt obligations. This is a transitional grade that is closely monitored by management for improvement or deterioration.
•Substandard - loans that are inadequately protected by the current sound worth and paying capacity of the obligor or by the collateral pledged, if any. Loans so classified may have a well-defined weakness or weaknesses that jeopardize the repayment of the debt. Such loans are characterized by the distinct possibility that the Company may sustain some loss if the deficiencies are not corrected. The substandard category includes non-accrual loans.
•Doubtful - loans that have all the weaknesses inherent in loans classified as Substandard with the added characteristic that the weaknesses make collection or liquidation in full highly questionable and improbable on the basis of currently known facts, conditions, and values.
The following table presents the recorded investment by risk categories at June 30, 2026:
Revolving Loans Amortized Cost BasisRevolving Loans Converted to Term Loans Amortized Cost Basis
Term Loans
Amortized Cost Basis by Origination Year and Risk Grades
(dollars in thousands)20262025202420232022PriorTotal
Commercial, Financial, & Agricultural
Pass$14,622 $33,239 $9,813 $5,775 $13,728 $33,893 $75,412 $666 $187,148 
Watch— 47 — 53 6 145 479 — 730 
Special Mention— 479 — 2,814 — 235 — — 3,528 
Substandard8 291 678 15 2,719 555 412 — 4,678 
Total$14,630 $34,056 $10,491 $8,657 $16,453 $34,828 $76,303 $666 $196,084 
Gross YTD charge-offs$— $171 $— $— $— $24 $— $— $195 
Real Estate Construction - Residential
Pass$11,622 $25,020 $549 $4,849 $— $— $179 $— $42,219 
Watch— — — 88 — — — — 88 
Total$11,622 $25,020 $549 $4,937 $— $— $179 $— $42,307 
Gross YTD charge-offs$— $— $— $— $— $— $— $— $— 
Real Estate Construction - Commercial
Pass$7,797 $28,050 $24,515 $1,387 $2,808 $3,163 $16,988 $1,085 $85,793 
Watch58 — 27 — 6 1 — — 92 
Substandard— 29 — — — — — — 29 
Total$7,855 $28,079 $24,542 $1,387 $2,814 $3,164 $16,988 $1,085 $85,914 
Gross YTD charge-offs$— $— $— $— $— $— $— $— $— 
Real Estate Mortgage - Residential
Pass$27,471 $58,757 $16,778 $32,593 $89,701 $85,409 $54,183 $518 $365,410 
Watch229 431 — — 326 563 31 98 1,678 
Substandard— 853 95 475 1,263 207 204 — 3,097 
Total$27,700 $60,041 $16,873 $33,068 $91,290 $86,179 $54,418 $616 $370,185 
Gross YTD charge-offs$— 
Real Estate Mortgage - Commercial
Pass$88,726 $147,311 $37,927 $60,848 $141,126 $155,880 $20,376 $2,405 $654,599 
Watch9,045 2,869 132 156 14,282 250 — — 26,734 
Special Mention— — 20,164 — 4,799 — — — 24,963 
Substandard— 1,310 146 46 3,909 912 — — 6,323 
Total$97,771 $151,490 $58,369 $61,050 $164,116 $157,042 $20,376 $2,405 $712,619 
Gross YTD charge-offs$— $— $— $— $— $25 $— $— $25 
Installment and other Consumer
Pass$1,624 $2,028 $759 $1,042 $1,009 $2,724 $60 $— $9,246 
Substandard— — — 5 — — — — 5 
Total$1,624 $2,028 $759 $1,047 $1,009 $2,724 $60 $— $9,251 
Gross YTD charge-offs$— $— $— $8 $— $108 $— $— $116 
Total Portfolio
Pass$151,862 $294,405 $90,341 $106,494 $248,372 $281,069 $167,198 $4,674 $1,344,415 
Watch9,332 3,347 159 297 14,620 959 510 98 29,322 
Special Mention— 479 20,164 2,814 4,799 235 — — 28,491 
Substandard8 2,483 919 541 7,891 1,674 616 — 14,132 
Total$161,202 $300,714 $111,583 $110,146 $275,682 $283,937 $168,324 $4,772 $1,416,360 
Total Gross YTD charge-offs$— $171 $— $8 $— $157 $— $— $336 
The following table presents the recorded investment by risk categories at December 31, 2025:
Revolving Loans Amortized Cost BasisRevolving Loans Converted to Term Loans Amortized Cost Basis
Term Loans
Amortized Cost Basis by Origination Year and Risk Grades
(dollars in thousands)20252024202320222021PriorTotal
December 31, 2025
Commercial, Financial, & Agricultural
Pass$65,367 $11,383 $9,223 $17,270 $19,867 $24,386 $66,741 $1,279 $215,516 
Watch581 164 93 8 — 148 1,473 — 2,467 
Special Mention729 — 3,058 317 — 261 — — 4,365 
Substandard203 679 15 3,184 536 25 594 — 5,236 
Total$66,880 $12,226 $12,389 $20,779 $20,403 $24,820 $68,808 $1,279 $227,584 
Gross YTD charge-offs$— $307 $73 $78 $— $59 $521 $— $1,038 
Real Estate Construction - Residential
Pass$30,523 $4,066 $4,881 $— $— $— $51 $— $39,521 
Watch— — 88 — — — — — 88 
Total$30,523 $4,066 $4,969 $— $— $— $51 $— $39,609 
Gross YTD charge-offs$— $— $— $— $— $— $— $— $— 
Real Estate Construction - Commercial
Pass$44,693 $17,876 $8,737 $3,226 $2,757 $687 $4,660 $1,085 $83,721 
Watch59 29 — 8 — — — — 96 
Substandard29 — — — — — — — 29 
Total$44,781 $17,905 $8,737 $3,234 $2,757 $687 $4,660 $1,085 $83,846 
Gross YTD charge-offs$— $— $— $— $— $— $— $— $— 
Real Estate Mortgage - Residential
Pass$63,792 $21,182 $36,980 $98,512 $42,745 $48,795 $48,900 $1,039 $361,945 
Watch442 — — 487 370 442 31 157 1,929 
Substandard3,463 98 495 1,301 — 189 216 — 5,762 
Total$67,697 $21,280 $37,475 $100,300 $43,115 $49,426 $49,147 $1,196 $369,636 
Gross YTD charge-offs$— $— $— $— $— $14 $— $— $14 
Real Estate Mortgage - Commercial
Pass$186,984 $43,797 $82,928 $161,945 $151,011 $70,426 $16,381 $1,642 $715,114 
Watch3,185 445 214 3,978 325 631 — — 8,778 
Special Mention— 20,561 — 4,932 — — — — 25,493 
Substandard1,311 147 — 4,145 — 760 144 — 6,507 
Total$191,480 $64,950 $83,142 $175,000 $151,336 $71,817 $16,525 $1,642 $755,892 
Gross YTD charge-offs$— $49 $76 $— $— $32 $— $— $157 
Installment and other Consumer
Pass$2,696 $1,063 $1,764 $1,628 $367 $2,605 $68 $— $10,191 
Substandard— — 7 13 14 — — — 34 
Total$2,696 $1,063 $1,771 $1,641 $381 $2,605 $68 $— $10,225 
Gross YTD charge-offs$— $3 $33 $13 $— $330 $— $— $379 
Total Portfolio
Pass$394,055 $99,367 $144,513 $282,581 $216,747 $146,899 $136,801 $5,045 $1,426,008 
Watch4,267 638 395 4,481 695 1,221 1,504 157 13,358 
Special Mention729 20,561 3,058 5,249 — 261 — — 29,858 
Substandard5,006 924 517 8,643 550 974 954 — 17,568 
Total$404,057 $121,490 $148,483 $300,954 $217,992 $149,355 $139,259 $5,202 $1,486,792 
Total Gross YTD charge-offs$— $359 $182 $91 $— $435 $521 $— $1,588 
Delinquent and Non-Accrual Loans
The delinquency status of loans is determined based on the contractual terms of the notes. Loans are generally classified as delinquent once payments become 30 days or more past due. The Company’s policy is to discontinue the accrual of interest income on any loan when, in the opinion of management, the ultimate collectability of interest or principal is no longer probable. In general, loans are placed on non-accrual status when they become 90 days or more past due. However, management considers many factors before placing a loan on non-accrual status, including the delinquency status of the loan, the overall financial condition of the borrower, the progress of management’s collection efforts and the value of the underlying collateral. Subsequent interest payments received on non-accrual loans are applied to principal if any doubt exists as to the collectability of such principal; otherwise, such receipts are recorded as interest income on a cash basis. Non-accrual loans are returned to accrual status when, in the opinion of management, the financial condition of the borrower indicates that the timely collectability of interest and principal is probable and the borrower demonstrates the ability to pay under the terms of the note through a sustained period of repayment performance, which is generally six months.
The following table presents the recorded investment in non-accrual loans and loans past due over 90 days still on accrual by class of loans as of June 30, 2026 and December 31, 2025:
(dollars in thousands)Non-accrual with no AllowanceNon-accrual with AllowanceTotal Non-accrual90 Days Past Due And Still AccruingTotal Non-performing Loans
June 30, 2026
Commercial, Financial, and Agricultural$1,538 $413 $1,951 $— $1,951 
Real estate mortgage − residential854 2,182 3,036 156 3,192 
Real estate mortgage − commercial— 1,502 1,502 — 1,502 
Installment and Other Consumer— 5 5 5 10 
Total$2,392 $4,102 $6,494 $161 $6,655 
December 31, 2025
Commercial, Financial, and Agricultural$603 $400 $1,003 $— $1,003 
Real estate mortgage − residential— 5,656 5,656 295,685 
Real estate mortgage − commercial— 143 143 —143 
Installment and Other Consumer— 34 34 — 34 
Total$603 $6,233 $6,836 $29 $6,865 
No material amount of interest income was recognized on non-accrual loans during the three and six months ended June 30, 2026.
The following table provides aging information for the Company’s past due and non-accrual loans at June 30, 2026 and December 31, 2025:
(dollars in thousands)Current or Less Than 30 Days Past Due30 - 89 Days Past Due90 Days Past Due And Still AccruingNon-AccrualTotal
June 30, 2026
Commercial, Financial, and Agricultural$193,156 $977 $— $1,951 $196,084 
Real estate construction − residential42,307 — — — 42,307 
Real estate construction − commercial85,459 455 — — 85,914 
Real estate mortgage − residential366,421 572 156 3,036 370,185 
Real estate mortgage − commercial711,039 78 — 1,502 712,619 
Installment and Other Consumer9,143 98 5 5 9,251 
Total$1,407,525 $2,180 $161 $6,494 $1,416,360 
December 31, 2025
Commercial, Financial, and Agricultural$226,129 $452 $— $1,003 $227,584 
Real estate construction − residential39,521 88 — — 39,609 
Real estate construction − commercial83,846 — — — 83,846 
Real estate mortgage − residential362,289 1,662 29 5,656 369,636 
Real estate mortgage − commercial755,512 237 — 143 755,892 
Installment and Other Consumer10,105 86 — 34 10,225 
Total$1,477,402 $2,525 $29 $6,836 $1,486,792 
Loan Modifications for Borrowers Experiencing Financial Difficulty
In the normal course of business, the Company may execute loan modifications with borrowers. These modifications are analyzed to determine whether the modification is considered concessionary, long-term and made to a borrower experiencing financial difficulty. The Company’s modifications generally include interest rate adjustments, principal reductions, and amortization and maturity date extensions. If a loan modification is determined to be made to a borrower experiencing financial difficulty, the loan is considered collateral-dependent and evaluated as part of the allowance for credit losses as described above in the Allowance for Credit Losses section of this note.

For each of the three and six months ended June 30, 2026 and 2025, the Company did not modify any loans made to borrowers experiencing financial difficulty. The Company monitors loan payments on an on-going basis to determine if a loan is considered to have a payment default. Determination of payment default involves analyzing the economic conditions that exist for each customer and their ability to generate positive cash flows during the loan term.
Loans Held for Sale
The Company designates certain long-term fixed rate personal real estate loans as held for sale. Loans held for sale are being carried at the lower of cost or estimated fair value. The loans are primarily sold to Freddie Mac, Fannie Mae, PennyMac, and various other secondary market investors. Loans held for sale totaled $0.2 million at June 30, 2026 and $0.6 million at December 31, 2025.