Servicing |
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| Transfers and Servicing [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Servicing | NOTE 5 SERVICING Loans serviced for others are not included in the accompanying Company's consolidated balance sheets. The unpaid principal balances of 1-4 family real estate loans serviced for others were $370.0, $362.8 and $362.6 million at September 30, 2026 and 2025 and at December 31, 2025, respectively. Unpaid principal balances of agricultural real estate loans serviced for others were $173.1, $152.3 and $153.4 million at September 30, 2026 and 2025 and at December 31, 2025, respectively. The balance of capitalized servicing rights included in assets at September 30, 2026 and 2025 and at December 31, 2025 for 1-4 family real estate loans, was $3.9, $3.6 and $3.6 million, respectively. Agricultural real estate loan servicing rights were $2.5, $2.4 and $2.4 million at September 30, 2026 and 2025 and at December 31, 2025, respectively. The capitalized addition of servicing rights is included in loan servicing income on the Company's consolidated statement of income. The fair value of the capitalized servicing rights for 1-4 family real estate loans as of September 30, 2026 and 2025 was $4.1 million and $4.7 million, respectively, and at December 31, 2025 was $4.5 million. Capitalized servicing rights for agricultural real estate loans had a fair value of $1.1 million and $2.0 million as of September 30, 2026 and 2025, respectively, and was $1.5 million at December 31, 2025. The valuations were completed by stratifying the loans into like groups based on loan type and term. Impairment was measured by estimating the fair value of each stratum, taking into consideration an estimated level of prepayment based upon current market conditions. An average constant prepayment rate for 1-4 family real estate loans of 11.0% and 8.7% were utilized at September 30, 2026 and 2025, respectively, and 9.8% at December 31, 2025. Agricultural real estate loans utilize an average constant prepayment rate based on the Bank's last twelve months of data. The average constant prepayment rate was 1.761% and 0.715% for fixed rate agricultural real estate loans at September 30, 2026 and 2025, respectively, compared to 1.054% at December 31, 2025. At September 30, 2026, the fair value of three 1-4 family real estate strata, which included 1,003 of the total 3,578 loans, was slightly below the carrying value using a discount yield of 6.47% which resulted in an impairment expense of $5 thousand, bringing the valuation allowance to $10 thousand. At September 30, 2026, the carrying value of all fourteen agricultural real estate strata, which included 677 loans, using an approximate discount rate of 8.20% were higher than the fair value requiring an impairment expense of $145 thousand, bringing the valuation allowance to $1.4 million. At September 30, 2025, the fair value of two 1-4 family real estate strata, which included 73 of the total 3,620 loans, was slightly below the carrying value using a discount yield of 5.43% which resulted in the need to establish a $5 thousand valuation allowance. At September 30, 2025, the carrying value of all fourteen agricultural real estate strata, which included 652 loans, using an approximate discount rate of 8.16% were higher than the fair value requiring a $454 thousand valuation allowance to be established. The following table presents the activity in the mortgage servicing rights for the three and nine months ended September 30, 2026 and 2025.
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