Loans

6 Months Ended

Jun. 30, 2026

NOTE 3: Loans

The Corporation’s loans are stated at their face amount, net of deferred fees and costs and discounts, and consist of the classes of loans included in the following table. The Corporation has elected to exclude accrued interest receivable, totaling $9.08 million and $9.04 million at June 30, 2026 and December 31, 2025, respectively, from the recorded balance of loans.


		June 30,			December 31,
(Dollars in thousands)		2026			2025
Commercial real estate		$	919,472		$	835,432
Commercial business			125,231			115,710
Construction - commercial real estate			40,851			99,604
Land acquisition and development			87,096			66,248
Builder lines			32,576			37,938
Construction - consumer real estate			32,015			29,288
Residential mortgage			325,799			319,536
Equity lines			82,495			76,460
Other consumer			10,657			10,085
Consumer finance - automobiles			404,918			406,312
Consumer finance - marine and recreational vehicles			51,679			57,963
Subtotal			2,112,789			2,054,576
Less allowance for credit losses			(39,675)			(39,677)
Loans, net		$	2,073,114		$	2,014,899

Other consumer loans included $259,000 and $240,000 of demand deposit overdrafts at June 30, 2026 and December 31, 2025, respectively.

The following table shows the aging of the Corporation’s loan portfolio, by class, at June 30, 2026.


		30-59		60-89		90+								90+ Days
		Days		Days		Days		Total						Past Due and
(Dollars in thousands)		Past Due		Past Due		Past Due		Past Due		Current¹		Total Loans		Accruing
Commercial real estate		$	—	$	—	$	—	$	—	$	919,472	$	919,472	$	—
Commercial business			57		—		—		57		125,174		125,231		—
Construction - commercial real estate			—		—		—		—		40,851		40,851		—
Land acquisition and development			—		—		—		—		87,096		87,096		—
Builder lines			—		—		—		—		32,576		32,576		—
Construction - consumer real estate			—		—		—		—		32,015		32,015		—
Residential mortgage			677		101		1,102		1,880		323,919		325,799		142
Equity lines			125		41		75		241		82,254		82,495		75
Other consumer			78		41		12		131		10,526		10,657		—
Consumer finance - automobiles			13,263		1,983		645		15,891		389,027		404,918		—
Consumer finance - marine and recreational vehicles			343		—		—		343		51,336		51,679		—
Total		$	14,543	$	2,166	$	1,834	$	18,543	$	2,094,246	$	2,112,789	$	217

For the purposes of the table above, “Current” includes loans that are 1-29 days past due.

The table above includes nonaccrual loans that are current of $74,000, 30-59 days past due of $10,000, 60-89 days past due of $117,000 and 90+ days past due of $1.62 million.

The following table shows the aging of the Corporation’s loan portfolio, by class, at December 31, 2025.


		30-59		60-89		90+								90+ Days
		Days		Days		Days		Total						Past Due and
(Dollars in thousands)		Past Due		Past Due		Past Due		Past Due		Current¹		Total Loans		Accruing
Commercial real estate		$	—	$	262	$	—	$	262	$	835,170	$	835,432	$	—
Commercial business			8		—		—		8		115,702		115,710		—
Construction - commercial real estate			—		—		—		—		99,604		99,604		—
Land acquisition and development			—		—		—		—		66,248		66,248		—
Builder lines			—		—		—		—		37,938		37,938		—
Construction - consumer real estate			—		—		—		—		29,288		29,288		—
Residential mortgage			1,019		111		813		1,943		317,593		319,536		—
Equity lines			155		65		23		243		76,217		76,460		23
Other consumer			17		—		—		17		10,068		10,085		—
Consumer finance - automobiles			16,741		2,129		1,022		19,892		386,420		406,312		—
Consumer finance - marine and recreational vehicles			429		37		—		466		57,497		57,963		—
Total		$	18,369	$	2,604	$	1,858	$	22,831	$	2,031,745	$	2,054,576	$	23

1For the purposes of the table above, “Current” includes loans that are 1-29 days past due.

The table above includes nonaccrual loans that are current of $219,000, 30-59 days past due of $17,000, 60-89 days past due of $86,000 and 90+ days past due of $1.84 million.

The following table shows the Corporation’s recorded balance of loans on nonaccrual status as of June 30, 2026 and December 31, 2025. The Corporation recognized $12,000 and $25,000 in interest income for the three and six months ended June 30, 2026 on loans on nonaccrual status as of June 30, 2026 and had $9,000 reversals of interest income upon placing loans on nonaccrual status during both of the three and six months ended June 30, 2026. All nonaccrual loans at June 30, 2026 and December 31, 2025 had an allowance for credit losses, with none individually evaluated.


		June 30,		December 31,
(Dollars in thousands)		2026		2025
Residential mortgage		$	1,111	$	1,135
Other consumer			62		—
Consumer finance - automobiles			645		1,022
Total		$	1,818	$	2,157

Occasionally, the Corporation modifies loans to borrowers experiencing financial difficulties by providing principal forgiveness, term extensions, interest rate reductions or other-than-insignificant payment delays. As the effect of most modifications is already included in the allowance for credit losses due to the measurement methodologies used in its estimate, the allowance for credit losses is typically not adjusted upon modification. When principal forgiveness is provided at modification, the amount forgiven is charged against the allowance for credit losses. In some cases, the Corporation may provide multiple types of modifications on one loan and when multiple types of modifications occur within the same period, the combination of modifications is separately reported.

The following tables present the amortized cost basis of loans as of June 30, 2026 and 2025 that were both experiencing financial difficulty and modified during the three and six months ended June 30, 2026 and 2025.

Three Months Ended June 30, 2026

Six Months Ended June 30, 2026

% of Total

Amortized

Class of

Amortized

Class of

(Dollars in thousands)

 

Cost

Loans

Cost

Loans

Term Extension

Builder lines

0.2

Total Term Extension

0.2

Combination Term Extension and Interest Rate Reduction

Residential mortgage

114

0.0

114

0.0

Total Combination Term Extension and Interest Rate Reduction

114

0.0

114

0.0

Total

183

0.0

183

0.0


		Three Months Ended June 30, 2025					Six Months Ended June 30, 2025
				% of Total					% of Total
		Amortized		Class of			Amortized		Class of
(Dollars in thousands)		Cost		Loans			Cost		Loans
Term Extension
Commercial real estate		$	3,554		0.5	%	$	3,554		0.5	%
Total Term Extension		$	3,554				$	3,554

Total		$	3,554		0.2	%	$	3,554		0.2	%

The following tables present the financial effects of the loan modifications presented above to borrowers experiencing financial difficulty for the three and six months ended June 30, 2026 and 2025.

Three Months Ended June 30, 2026

Six Months Ended June 30, 2026

Weighted-

Average

Interest

Term

Interest

Term

Rate

Extension

Rate

Extension

Reduction

(in years)

Reduction

(in years)

Builder lines

—

0.3

—

0.3

Residential mortgage

1.13

2.0

1.13

2.0

Total

1.13

1.3

1.13

1.3

Three Months Ended June 30, 2025

Six Months Ended June 30, 2025

Weighted-

Average

Interest

Term

Interest

Term

Rate

Extension

Rate

Extension

Reduction

(in years)

Reduction

(in years)

Commercial real estate

—

1.1

—

1.1

Total

—

1.1

—

1.1

The Corporation closely monitors the performance of modified loans to understand the effectiveness of its modification efforts. Upon the determination that all or a portion of a modified loan is uncollectible, that amount is charged against the allowance for credit losses. There were no payment defaults during the three and six months ended June 30, 2026 and 2025 of loans to borrowers experiencing financial difficulties that were modified during the previous twelve months and all were current as of June 30, 2026.