v3.26.1
Note 4 - Loans
6 Months Ended
Jun. 30, 2026
Notes to Financial Statements  
Financing Receivables [Text Block]

Loans:

 

Loan balances were as follows:

 

(In Thousands of Dollars)

 

June 30, 2026

  

December 31, 2025

 

Commercial real estate

        

Owner occupied

 $627,421  $393,061 

Non-owner occupied

  1,016,924   710,468 

Farmland

  228,228   211,370 

Other

  378,388   294,587 

Commercial

        

Commercial and industrial

  592,431   340,224 

Agricultural

  56,799   54,195 

Residential real estate

        

1-4 family residential

  1,230,110   850,300 

Home equity lines of credit

  360,685   181,544 

Consumer

        

Indirect

  239,209   231,242 

Direct

  21,375   16,483 

Other

  12,306   10,070 

Total loans

 $4,763,876  $3,293,544 

Net deferred loan costs

  12,601   11,169 

Allowance for credit losses

  (53,285)  (36,811)

Net loans

 $4,723,192  $3,267,902 

 

Allowance for credit loss activity

 

The following tables present the activity in the allowance for credit losses by portfolio segment for the three and six month periods ended June 30, 2026 and 2025:

 

Three Months Ended June 30, 2026

 

  

Commercial

      

Residential

         

(In Thousands of Dollars)

 

Real Estate

  

Commercial

  

Real Estate

  

Consumer

  

Total

 

Allowance for credit losses

                    

Beginning balance

 $30,049  $8,041  $11,331  $5,263  $54,684 

(Credit) Provision for credit losses

  1,747   (111)  (257)  695   2,074 

Initial allowance on purchased seasoned loans

  0   160   0   0   160 

Loans charged off

  (3,125)  (188)  (69)  (421)  (3,803)

Recoveries

  0   48   47   75   170 

Total ending allowance balance

 $28,671  $7,950  $11,052  $5,612  $53,285 

 

Six Months Ended  June 30, 2026

 

  

Commercial

      

Residential

         

(In Thousands of Dollars)

 

Real Estate

  

Commercial

  

Real Estate

  

Consumer

  

Total

 

Allowance for credit losses

                    

Beginning balance

 $20,064  $4,536  $7,241  $4,970  $36,811 

(Credit) Provision for credit losses

  (24)  218   (244)  1,111   1,061 

Initial allowance on loans purchased with credit deterioration

  3,380   600   15   0   3,995 

Initial allowance on purchased seasoned loans

  8,377   2,906   4,102   110   15,495 

Loans charged off

  (3,126)  (479)  (152)  (775)  (4,532)

Recoveries

  0   169   90   196   455 

Total ending allowance balance

 $28,671  $7,950  $11,052  $5,612  $53,285 

 

Three Months Ended June 30, 2025

 

  

Commercial

      

Residential

         

(In Thousands of Dollars)

 

Real Estate

  

Commercial

  

Real Estate

  

Consumer

  

Total

 

Allowance for credit losses

                    

Beginning balance

 $19,480  $4,383  $7,065  $4,621  $35,549 

(Credit) Provision for credit losses

  2,149   901   191   345   3,586 

Loans charged off

  (22)  (341)  (58)  (327)  (748)

Recoveries

  20   30   12   114   176 

Total ending allowance balance

 $21,627  $4,973  $7,210  $4,753  $38,563 

 

Six Months Ended  June 30, 2025

 

  

Commercial

      

Residential

         

(In Thousands of Dollars)

 

Real Estate

  

Commercial

  

Real Estate

  

Consumer

  

Total

 

Allowance for credit losses

                    

Beginning balance

 $19,259  $4,628  $7,271  $4,705  $35,863 

(Credit) Provision for credit losses

  2,412   776   (43)  463   3,608 

Loans charged off

  (66)  (654)  (77)  (649)  (1,446)

Recoveries

  22   223   59   234   538 

Total ending allowance balance

 $21,627  $4,973  $7,210  $4,753  $38,563 

 

The cumulative loss rate used as the basis for the estimate of credit losses is comprised of the Company's historical loss experience from December 31, 2011 to June 30, 2026. As of June 30, 2026, the Company expects that the markets in which it operates will experience minimal changes to economic conditions, stable trend in unemployment rate, and an increased trend of delinquencies. Management adjusted historical loss experience for these expectations. No reversion adjustments were necessary, as the starting point for the Company's estimate was a cumulative loss rate covering the expected contractual term of the portfolio. While there are many factors that go into the calculation of the allowance for credit losses, the change in the balances from  June 30, 2025 to June 30, 2026, is largely attributed to the Middlefield Merger. The increase related to the Middlefield Merger was partially offset by charge offs related to the settlement or sale of the debt or collateral associated with two commercial real estate non-owner occupied relationships and one multifamily relationship, and improving loss ratios of various loan portfolio segments.

 

The following tables present the amortized cost basis of loans on nonaccrual status and loans past due over 89 days still accruing as of June 30, 2026 and December 31, 2025:

 

  

Nonaccrual with

  

Nonaccrual with

  

Loans past due

 
  

no allowance

  

an allowance

  

over 89 days

 

(In Thousands of Dollars)

 

for credit loss

  

for credit loss

  

still accruing

 

June 30, 2026

            

Commercial real estate

            

Owner occupied

 $4,196  $2,580  $0 

Non-owner occupied

  2,227   10,576   0 

Farmland

  0   1,813   0 

Other

  491   1,041   0 

Commercial

            

Commercial and industrial

  11,454   3,651   0 

Agricultural

  0   178   0 

Residential real estate

            

1-4 family residential

  1,651   2,543   295 

Home equity lines of credit

  487   802   0 

Consumer

            

Indirect

  27   503   0 

Direct

  0   24   0 

Other

  0   97   0 

Total loans

 $20,533  $23,808  $295 

 

  

Nonaccrual with

  

Nonaccrual with

  

Loans past due

 
  

no allowance

  

an allowance

  

over 89 days

 

(In Thousands of Dollars)

 

for credit loss

  

for credit loss

  

still accruing

 

December 31, 2025

            

Commercial real estate

            

Owner occupied

 $1,346  $207  $0 

Non-owner occupied

  2,408   10,776   0 

Farmland

  0   1,917   0 

Other

  1,093   0   0 

Commercial

            

Commercial and industrial

  0   2,778   82 

Agricultural

  0   159   0 

Residential real estate

            

1-4 family residential

  1,095   2,329   271 

Home equity lines of credit

  424   689   0 

Consumer

            

Indirect

  61   462   0 

Direct

  0   21   0 

Other

  97   0   0 

Total loans

 $6,524  $19,338  $353 

 

There were no loans that were held for sale and in nonaccrual status for the periods ending  June 30, 2026 and   December 31, 2025.

 

The following tables present the amortized cost basis of collateral-dependent loans by class of loans as of June 30, 2026 and December 31, 2025:

 

(In Thousands of Dollars)

 

Real Estate

  

Business Assets

  

Vehicles

  

Cash

 

June 30, 2026

                

Commercial real estate

                

Owner occupied

 $6,548  $0  $0  $0 

Non-owner occupied

  27,567   0   0   0 

Farmland

  1,821   0   0   0 

Other

  1,552   0   0   0 

Commercial

                

Commercial and industrial

  0   14,510   0   0 

Agricultural

  0   8   0   0 

Residential real estate

                

1-4 family residential

  2,851   0   0   0 

Home equity lines of credit

  889   0   0   0 

Consumer

                

Indirect

  0   0   67   0 

Direct

  0   0   1   0 

Other

  97   0   0   0 

Total loans

 $41,325  $14,518  $68  $0 

 

(In Thousands of Dollars)

 

Real Estate

  

Business Assets

  

Vehicles

  

Cash

 

December 31, 2025

                

Commercial real estate

                

Owner occupied

 $1,346  $0  $0  $0 

Non-owner occupied

  24,235   0   0   0 

Farmland

  1,872   0   0   0 

Other

  1,093   0   0   0 

Commercial

                

Commercial and industrial

  0   2,352   0   0 

Agricultural

  0   0   0   0 

Residential real estate

                

1-4 family residential

  2,411   0   0   0 

Home equity lines of credit

  944   0   0   0 

Consumer

                

Indirect

  0   0   102   0 

Direct

  0   0   4   0 

Other

  97   0   0   0 

Total loans

 $31,998  $2,352  $106  $0 

 

The following tables present the aging of the amortized cost basis in past due loans as of June 30, 2026 and December 31, 2025 by class of loans.

 

          

90 Days

             
          

or More

             
  

30-59 Days

  

60-89 Days

  

Past Due

  

Total

  

Loans Not

     

(In Thousands of Dollars)

 

Past Due

  

Past Due

  

and Nonaccrual

  

Past Due

  

Past Due

  

Total

 

June 30, 2026

                        

Commercial real estate

                        

Owner occupied

 $697  $506  $6,776  $7,979  $619,288  $627,267 

Non-owner occupied

  48   378   12,803   13,229   1,003,345   1,016,574 

Farmland

  182   6   1,813   2,001   226,078   228,079 

Other

  991   0   1,532   2,523   375,186   377,709 

Commercial

                        

Commercial and industrial

  1,099   227   15,105   16,431   577,624   594,055 

Agricultural

  170   55   178   403   57,380   57,783 

Residential real estate

                        

1-4 family residential

  9,331   2,089   4,489   15,909   1,215,359   1,231,268 

Home equity lines of credit

  416   210   1,289   1,915   359,128   361,043 

Consumer

                        

Indirect

  1,640   680   530   2,850   246,077   248,927 

Direct

  45   6   24   75   21,387   21,462 

Other

  92   1   97   190   12,120   12,310 

Total loans

 $14,711  $4,158  $44,636  $63,505  $4,712,972  $4,776,477 

  

          

90 Days

             
          

or More

             
  

30-59 Days

  

60-89 Days

  

Past Due

  

Total

  

Loans Not

     

(In Thousands of Dollars)

 

Past Due

  

Past Due

  

and Nonaccrual

  

Past Due

  

Past Due

  

Total

 

December 31, 2025

                        

Commercial real estate

                        

Owner occupied

 $419  $1,018  $1,553  $2,990  $389,881  $392,871 

Non-owner occupied

  8   0   13,184   13,192   696,884   710,076 

Farmland

  116   163   1,917   2,196   209,035   211,231 

Other

  0   0   1,093   1,093   292,915   294,008 

Commercial

                        

Commercial and industrial

  1,064   174   2,860   4,098   337,639   341,737 

Agricultural

  235   30   159   424   54,665   55,089 

Residential real estate

                        

1-4 family residential

  9,848   1,122   3,695   14,665   836,515   851,180 

Home equity lines of credit

  75   54   1,113   1,242   180,544   181,786 

Consumer

                        

Indirect

  2,090   470   523   3,083   237,027   240,110 

Direct

  37   7   21   65   16,486   16,551 

Other

  17   0   97   114   9,960   10,074 

Total loans

 $13,909  $3,038  $26,215  $43,162  $3,261,551  $3,304,713