Finward Bancorp Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

Note 7 - Loans Receivable (Tables)

Note 7 - Loans Receivable (Tables)

6 Months Ended

Jun. 30, 2023

Schedule of Accounts, Notes, Loans and Financing Receivable [Table Text Block]

Loans receivable are summarized below:

(Dollars in thousands)
	June 30, 2023			December 31, 2022
Loans secured by real estate:
Residential real estate	$	480,791		$	484,595
Home equity		43,153			38,978
Commercial real estate		501,759			486,431
Construction and land development		123,655			108,926
Multifamily		240,647			251,014
Total loans secured by real estate		1,390,005			1,369,944
Commercial business		95,796			93,278
Consumer		667			918
Manufactured homes		32,669			34,882
Government		10,646			9,549
Loans receivable		1,529,783			1,508,571
Add (less):
Net deferred loan origination costs		4,449			5,083
Undisbursed loan funds		(71	)		(23	)
Loans receivable, net of deferred fees and costs..	$	1,534,161		$	1,513,631

Financing Receivable, Past Due [Table Text Block]

(Dollars in thousands)	30-59 Days Past Due		60-89 Days Past Due		Greater Than 90 Days Past Due and Accruing		Total Past Due and Accruing		Current		Accruing Loans		Non-accrual Loans		Total Loans Receivable
June 30, 2023
Residential real estate	$	3,585	$	1,295	$	255	$	5,135	$	470,343	$	475,478	$	5,313	$	480,791
Home equity		32		104		-		136		42,399		42,535		618		43,153
Commercial real estate		187		1,938		-		2,125		498,107		500,232		1,527		501,759
Construction and land development.		5,032		-		-		5,032		118,044		123,076		579		123,655
Multifamily		701		-		-		701		238,506		239,207		1,440		240,647
Commercial business		208		-		-		208		92,996		93,204		2,592		95,796
Consumer		-		-		-		-		665		665		2		667
Manufactured homes		924		195		-		1,119		31,550		32,669		-		32,669
Government		-		-		-		-		10,646		10,646		-		10,646
Total	$	10,669	$	3,532	$	255	$	14,456	$	1,503,256	$	1,517,712	$	12,071	$	1,529,783

December 31, 2022
Residential real estate	$	3,758	$	2,520	$	166	$	6,444	$	472,804	$	479,248	$	5,347	$	484,595
Home equity		315		42		-		357		38,027		38,384		594		38,978
Commercial real estate		1,399		150		-		1,549		481,640		483,189		3,242		486,431
Construction and land development.		2,673		-		-		2,673		106,253		108,926		-		108,926
Multifamily		1,724		616		-		2,340		241,610		243,950		7,064		251,014
Commercial business		1,775		-		-		1,775		89,622		91,397		1,881		93,278
Consumer		3		-		-		3		915		918		-		918
Manufactured homes		601		256		82		939		33,943		34,882		-		34,882
Government		-		-		-		-		9,549		9,549		-		9,549
Total	$	12,248	$	3,584	$	248	$	16,080	$	1,474,363	$	1,490,443	$	18,128	$	1,508,571

Financing Receivable Credit Quality Indicators [Table Text Block]

June 30, 2023	2023			2022			2021		2020			2019			Prior			Revolving		Revolving Converted to Term		Total
Total Loans Receivable	$	80,571		$	330,080		$	344,988	$	258,161		$	121,168		$	306,931		$	87,528	$	356	$	1,529,783
Total Current period gross writeoff	$	(40	)	$	(110	)	$	-	$	(322	)	$	(11	)	$	(372	)	$	-	$	-		(855	)

Residential real estate
Pass (1-6)	$	9,945		$	85,854		$	101,569	$	121,368		$	25,420		$	126,491		$	2,668	$	-	$	473,315
Special Mention (7)		-			-			-		-			-			1,150			-		-		1,150
Substandard (8)		-			399			256		492			552			4,627			-		-		6,326
Total	$	9,945		$	86,253		$	101,825	$	121,860		$	25,972		$	132,268		$	2,668	$	-	$	480,791
Current period gross writeoff		-			-			-		-			-			-			-		-		-

Home equity
Pass (1-6)	$	61		$	118		$	107	$	17		$	73		$	2,255		$	39,370	$	356	$	42,357
Special Mention (7)		-			-			-		-			-			52			114		-		166
Substandard (8)		-			173			-		-			-			151			306		-		630
Total	$	61		$	291		$	107	$	17		$	73		$	2,458		$	39,790	$	356	$	43,153
Current period gross writeoff		-			-			-		-			-			-			-		-		-

Commercial real estate
Pass (1-6)	$	33,789		$	120,097		$	100,537	$	57,157		$	58,319		$	120,024		$	4,085	$	-	$	494,008
Special Mention (7)		-			74			-		1,313			1,148			1,815			144		-		4,494
Substandard (8)		-			1,208			92		240			-			1,717			-		-		3,257
Total	$	33,789		$	121,379		$	100,629	$	58,710		$	59,467		$	123,556		$	4,229	$	-	$	501,759
Current period gross writeoff		-			-			-		-			-			(372	)		-		-		(372	)

*Construction and land development*
Pass (1-6)	$	20,127		$	45,761		$	32,364	$	1,934		$	8,831		$	519		$	7,760	$	-	$	117,296
Special Mention (7)		168			-			3,559		2,053			-			-			-		-		5,780
Substandard (8)		-			579			-		-			-			-			-		-		579
Total	$	20,295		$	46,340		$	35,923	$	3,987		$	8,831		$	519		$	7,760	$	-	$	123,655
Current period gross writeoff		-			-			-		-			-			-			-		-		-

Multifamily
Pass (1-6)	$	8,461		$	54,610		$	81,019	$	56,920		$	14,479		$	22,860		$	182	$	-	$	238,531
Special Mention (7)		-			-			-		-			-			676			-		-		676
Substandard (8)		-			901			-		-			-			539			-		-		1,440
Total	$	8,461		$	55,511		$	81,019	$	56,920		$	14,479		$	24,075		$	182	$	-	$	240,647
Current period gross writeoff		-			-			-		-			-			-			-		-		-

Commercial business
Pass (1-6)	$	5,937		$	16,220		$	10,542	$	6,763		$	6,525		$	14,003		$	32,552	$	-	$	92,542
Special Mention (7)		-			-			66		-			140			456			-		-		662
Substandard (8)		-			-			207		144			4			1,890			347		-		2,592
Total	$	5,937		$	16,220		$	10,815	$	6,907		$	6,669		$	16,349		$	32,899	$	-	$	95,796
Current period gross writeoff		-			(110	)		-		(322	)		(11	)		-			-		-		(443	)

Consumer
Pass (1-6)	$	193		$	111		$	148	$	13		$	25		$	177		$	-	$	-	$	667
Substandard (8)		-			-			-		2			-			-			-		-		2
Total	$	193		$	111		$	148	$	13		$	25		$	177		$	-	$	-	$	667
Current period gross writeoff		(40	)		-			-		-			-			-			-		-		(40	)

Manufactured homes
Pass (1-6)	$	-		$	1,975		$	13,000	$	9,747		$	5,652		$	2,295		$	-	$	-	$	32,669
Total	$	-		$	1,975		$	13,000	$	9,747		$	5,652		$	2,295		$	-	$	-	$	32,669
Current period gross writeoff		-			-			-		-			-			-			-		-		-

Government
Pass (1-6)	$	1,890		$	2,000		$	1,522	$	-		$	-		$	5,234		$	-	$	-	$	10,646
Total	$	1,890		$	2,000		$	1,522	$	-		$	-		$	5,234		$	-	$	-	$	10,646
Current period gross writeoff		-			-			-		-			-			-			-		-		-

	December 31, 2022
(Dollars in thousands)		1-6		7		8

Loan Segment	Pass		Special mention		Substandard		Total
Residential real estate	$	477,222	$	1,338	$	6,035	$	484,595
Home equity		37,981		385		612		38,978
Commercial real estate		474,055		4,955		7,421		486,431
Construction and land development		106,580		2,346		-		108,926
Multifamily		242,091		1,859		7,064		251,014
Commercial business		90,694		703		1,881		93,278
Consumer		918		-		-		918
Manufactured homes		34,882		-		-		34,882
Government		9,549		-		-		9,549
Total	$	1,473,972	$	11,586	$	23,013	$	1,508,571

Financing Receivable, Modified [Table Text Block]

	For the three months ended June 30, 2023
(Dollars in thousands)	Payment Delay		Term Extension		Interest Rate Reduction		Combination Term Extension and Interest Rate Reduction		% of Total Segment Financing Receivables
Residential Real Estate	$	-	$	277	$	-	$	-		0.06	%
Total	$	-	$	277	$	-	$	-		0.02	%

	For the six months ended June 30,2023
(Dollars in thousands)	Payment Delay		Term Extension		Interest Rate Reduction		Combination Term Extension and Interest Rate Reduction		% of Total Segment Financing Receivables
Residential Real Estate	$	-	$	868	$	-	$	-		0.18	%
Total	$	-	$	868	$	-	$	-		0.06	%

(Dollars in thousands)

Current

30-59 Days

Past Due

60-89

Days Past

Due

Greater Than 90 Days Past Due

Residential Real Estate

688

180

Total

688

180

Schedule of Accretable Yield from Financing Receivables [Table Text Block]

Accretable yield, or income recorded for the three months ended June 30, is as follows:

(dollars in thousands)	Total
2022	$	440
2023		75

Accretable yield, or income recorded for the six months ended June 30, is as follows:

(dollars in thousands)	Total
2022	$	547
2023		242

Accretable yield, or income expected to be recorded in the future is as follows:


(dollars in thousands)	Total
Remainder 2023		370
2024		750
2025		672
2026		468
2027 and thereafter		3,784
Total	$	6,044

Financing Receivable, Allowance for Credit Loss [Table Text Block]

(Dollars in thousands)	Beginning Balance		Adoption of ASC 326		PCD Gross-up		Charge-offs			Recoveries		Provisions			Ending Balance

The Bancorp's activity in the allowance for loan losses, by loan segment, is summarized below for the three months ended June 30, 2023:

Allowance for loan losses:
Residential real estate	$	5,068	$	-	$	-	$	-		$	11	$	(225	)	$	4,854
Home equity		643		-		-		-			-		37			680
Commercial real estate		7,119		-		-		(360	)		1		271			7,031
Construction and land development		3,229		-		-		-			-		370			3,599
Multifamily		1,059		-		-		-			86		(125	)		1,020
Commercial business		2,095		-		-		(368	)		101		222			2,050
Consumer		64		-		-		(21	)		3		11			57
Manufactured homes		216		-		-		-			-		(50	)		166
Government		75		-		-		-			-		(25	)		50
Total	$	19,568	$	-	$	-	$	(749	)	$	202	$	486		$	19,507

The Bancorp's activity in the allowance for loan losses, by loan segment, is summarized below for the three months ended June 30, 2022:

Allowance for loan losses:
Residential real estate	$	2,493	$	-	$	-	$	-		$	29	$	234		$	2,756
Home equity		354		-		-		-			-		19			373
Commercial real estate		5,530		-		-		-			-		(3	)		5,527
Construction and land development		2,135		-		-		-			-		(391	)		1,744
Multifamily		889		-		-		-			-		239			1,128
Commercial business		1,941		-		-		-			7		(140	)		1,808
Consumer		45		-		-		(27	)		10		42			70
Manufactured homes		-		-		-		-			-		-			-
Government		-		-		-		-			-		-			-
Total	$	13,387	$	-	$	-	$	(27	)	$	46	$	-		$	13,406

The Bancorp's activity in the allowance for credit losses, by loan segment, is summarized below for the six months ended June 30, 2023:

Allowance for credit losses:
Residential real estate	$	3,021	$	1,688	$	535	$	-		$	63	$	(453	)	$	4,854
Home equity		410		99		29		-			-		142			680
Commercial real estate		5,784		1,003		443		(372	)		1		172			7,031
Construction and land development		1,253		1,735		-		-			-		611			3,599
Multifamily		1,007		141		-		-			86		(214	)		1,020
Commercial business		1,365		320		5		(443	)		148		655			2,050
Consumer		57		5		17		(40	)		6		12			57
Manufactured homes		-		112		-		-			-		54			166
Government		-		55		-		-			-		(5	)		50
Total	$	12,897	$	5,158	$	1,029	$	(855	)	$	304	$	974		$	19,507

The Bancorp's activity in the allowance for loan losses, by loan segment, is summarized below for the six months ended June 30, 2022:

Allowance for loan losses:
Residential real estate	$	2,480	$	-	$	-	$	-		$	50	$	226		$	2,756
Home equity		357		-		-		-			-		16			373
Commercial real estate		5,515		-		-		-			-		12			5,527
Construction and land development		2,119		-		-		-			-		(375	)		1,744
Multifamily		848		-		-		-			-		280			1,128
Commercial business		2,009		-		-		-			38		(239	)		1,808
Consumer		15		-		-		(37	)		12		80			70
Manufactured homes		-		-		-		-			-		-			-
Government		-		-		-		-			-		-			-
Total	$	13,343	$	-	$	-	$	(37	)	$	100	$	-		$	13,406

Schedule of Collateral Dependent Loans [Table Text Block]

	June 30, 2023
(dollars in thousands)	Real Estate		Accounts Receivable		Other		Total		ACL Allocation
Commercial real estate	$	2,839		-		-	$	2,839	$	7
Multifamily		1,471		-		-		1,471		-
Commercial business		242		3,010		355		3,607		701
Total	$	4,552	$	3,010	$	355	$	7,917	$	708

Financing Receivable, Nonaccrual [Table Text Block]

As of June 30, 2023	Nonaccrual with No Allowance for Credit Loss		Nonaccrual		Loans Past Due over 90 Days Still A ccruing
Residential real estate	$	1,190	$	4,123	$	255
Home equity		175		443		-
Commercial real estate		1,386		141		-
Construction and land development		-		579		-
Multifamily		1,440		-		-
Commercial business		402		2,190		-
Consumer		-		2		-
Manufactured homes		-		-		-
Government		-		-		-
Total	$	4,593	$	7,478	$	255

Financing Receivable, Impairment Evaluation [Table Text Block]

(Dollars in thousands)	Individually evaluated for impairment reserves		Collectively evaluated for impairment reserves		Loan receivables		Individually evaluated for impairment		Purchased credit impaired individually evaluated for impairment		Collectively evaluated for impairment

The Bancorp's allowance for loan losses impairment evaluation and loan receivables are summarized below at December 31, 2022:

Residential real estate	$	24	$	2,997	$	484,595	$	1,518	$	988	$	482,089
Home equity		3		407		38,978		294		125		38,559
Commercial real estate		13		5,771		486,431		2,392		2,935		481,104
Construction and land development		-		1,253		108,926		-		-		108,926
Multifamily		-		1,007		251,014		6,739		382		243,893
Commercial business		297		1,068		93,278		1,758		953		90,567
Consumer		-		57		918		-		17		901
Manufactured homes		-		-		34,882		-		-		34,882
Government		-		-		9,549		-		-		9,549
Total	$	337	$	12,560	$	1,508,571	$	12,701	$	5,400	$	1,490,470

Impaired Financing Receivables [Table Text Block]

							For the six months ended				For the three months ended
	As of December 31, 2022						June 30, 2022				June 30, 2022
(Dollars in thousands)	Recorded Investment		Unpaid Principal Balance		Related Allowance		Average Recorded Investment		Interest Income Recognized		Average Recorded Investment		Interest Income Recognized
With no related allowance recorded:
Residential real estate	$	1,683	$	3,017	$	-	$	2,438	$	155	$	2,816	$	125
Home equity		262		275		-		214		13		191		6
Commercial real estate		765		765		-		2,448		220		3,290		210
Construction & land development		-		-		-		573		-		860		-
Multifamily		556		647		-		2,337		62		3,228		62
Farmland		-		-		-		-		-		-		-
Commercial business		1,205		1,324		-		1,159		76		1,136		61
Consumer		-		-		-		14		-		21		-
Manufactured homes		-		-		-		-		-		-		-
Government		-		-		-		-		-		-		-

With an allowance recorded:
Residential real estate	$	88	$	88	$	17	$	154	$	9	$	188	$	6
Home equity		22		22		4		21		1		21		-
Commercial real estate		835		835		386		844		-		849		-
Construction & land development		-		-		-		-		-		-		-
Multifamily		-		-		-		-		-		-		-
Farmland		-		-		-		-		-		-		-
Commercial business		392		392		277		338		16		311		-
Consumer		-		-		-		-		-		-		-
Manufactured homes		-		-		-		-		-		-		-
Government		-		-		-		-		-		-		-

Total:
Residential real estate	$	1,771	$	3,105	$	17	$	2,592	$	164	$	3,004	$	131
Home equity	$	284	$	297	$	4	$	235	$	14	$	212	$	6
Commercial real estate	$	1,600	$	1,600	$	386	$	3,292	$	220	$	4,139	$	210
Construction & land development	$	-	$	-	$	-	$	573	$	-	$	860	$	-
Multifamily	$	556	$	647	$	-	$	2,337	$	62	$	3,228	$	62
Farmland	$	-	$	-	$	-	$	-	$	-	$	-	$	-
Commercial business	$	1,597	$	1,716	$	277	$	1,497	$	92	$	1,447	$	61
Consumer	$	-	$	-	$	-	$	14	$	-	$	21	$	-
Manufactured homes	$	-	$	-	$	-	$	-	$	-	$	-	$	-
Government	$	-	$	-	$	-	$	-	$	-	$	-	$	-

Schedule of Changes in Liability for Credit Loss on Unfunded Commitments [Table Text Block]

	Six months ended,
	June 30,
(Dollars in thousands)	2023
Balance, beginning of period	$	-
Adoption of ASC 326		3,108
Provision (recovery of provision)		28
Balance, end of period	$	3,136