Finward Bancorp Annual report pursuant to Section 13 and 15(d)

Annual report pursuant to Section 13 and 15(d)

Note 4 - Loans Receivable (Tables)

Note 4 - Loans Receivable (Tables)

12 Months Ended

Dec. 31, 2023

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

(Dollars in thousands)
	December 31, 2023		December 31, 2022
Loans secured by real estate:
Residential real estate	$	484,948	$	484,595
Home equity		46,599		38,978
Commercial real estate		503,202		486,431
Construction and land development		115,227		108,926
Multifamily		219,917		251,014
Total loans secured by real estate		1,369,893		1,369,944
Commercial business		97,386		93,278
Consumer		610		918
Manufactured homes		30,845		34,882
Government		10,021		9,549
Loans receivable		1,508,755		1,508,571
Add (less):
Net deferred loan origination costs		3,705		5,083
Undisbursed loan funds		135		(23	)
Loans receivable, net of deferred fees and costs	$	1,512,595	$	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
December 31, 2023
Residential real estate	$	5,857	$	4,362	$	1,131	$	11,350	$	471,905	$	483,255	$	1,693	$	484,948
Home equity		226		18		-		244		45,887		46,131		468		46,599
Commercial real estate		3,168		262		712		4,142		498,227		502,369		833		503,202
Construction and land development.		2,523		-		-		2,523		112,704		115,227		-		115,227
Multifamily		5,333		-		-		5,333		210,869		216,202		3,715		219,917
Commercial business		105		29		-		134		94,355		94,489		2,897		97,386
Consumer		12		-		-		12		596		608		2		610
Manufactured homes		634		379		-		1,013		29,832		30,845		-		30,845
Government		-		-		-		-		10,021		10,021		-		10,021
Total	$	17,858	$	5,050	$	1,843	$	24,751	$	1,474,396	$	1,499,147	$	9,608	$	1,508,755

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]

December 31, 2023	2023			2022			2021		2020			2019			Prior			Revolving			Revolving Converted to Term		Total
Total Loans Receivable	$	148,105		$	323,820		$	321,183	$	234,861		$	108,683		$	274,027		$	94,893		$	3,183	$	1,508,755
Total current period gross charge-off	$	(95	)	$	(150	)	$	-	$	(367	)	$	(50	)	$	(1,882	)	$	(27	)	$	-		(2,571	)

Residential real estate
Pass (1-6)	$	20,740		$	97,671		$	106,778	$	115,001		$	23,873		$	113,987		$	1,716		$	-	$	479,766
Special Mention (7)		405			-			473		173			431			1,602			-			-		3,084
Substandard (8)		-			786			152		471			217			472			-			-		2,098
Total	$	21,145		$	98,457		$	107,403	$	115,645		$	24,521		$	116,061		$	1,716		$	-	$	484,948
Current period gross charge-off		-			(40	)		-		(25	)		(39	)		(893	)		-			-		(997	)

Home equity
Pass (1-6)	$	110		$	114		$	101	$	14		$	61		$	2,051		$	42,801		$	700	$	45,952
Special Mention (7)		-			-			-		-			4			31			70			63		168
Substandard (8)		-			161			-		-			-			67			251			-		479
Total	$	110		$	275		$	101	$	14		$	65		$	2,149		$	43,122		$	763	$	46,599
Current period gross charge-off		-			-			-		-			-			(16	)		(27	)		-		(43	)

Commercial real estate
Pass (1-6)	$	52,880		$	127,607		$	90,108	$	55,236		$	56,255		$	108,489		$	2,649		$	-	$	493,224
Special Mention (7)		-			69			2,429		1,274			1,123			2,397			142			-		7,434
Substandard (8)		-			-			-		230			-			2,314			-			-		2,544
Total	$	52,880		$	127,676		$	92,537	$	56,740		$	57,378		$	113,200		$	2,791		$	-	$	503,202
Current period gross charge-off		-			-			-		-			-			(372	)		-			-		(372	)

*Construction and land development*
Pass (1-6)	$	48,518		$	24,948		$	13,411	$	1,732		$	4,284		$	473		$	12,539		$	2,420	$	108,325
Special Mention (7)		365			76			4,205		2,256			-			-			-			-		6,902
Total	$	48,883		$	25,024		$	17,616	$	3,988		$	4,284		$	473		$	12,539		$	2,420	$	115,227
Current period gross charge-off		-			-			-		-			-			-			-			-		-

Multifamily
Pass (1-6)	$	9,333		$	53,493		$	78,122	$	41,773		$	13,156		$	19,609		$	186		$	-	$	215,672
Substandard (8)		-			-			1,666		1,562			-			1,017			-			-		4,245
Total	$	9,333		$	53,493		$	79,788	$	43,335		$	13,156		$	20,626		$	186		$	-	$	219,917
Current period gross charge-off		-			-			-		-			-			-			-			-		-

Commercial business
Pass (1-6)	$	13,110		$	13,774		$	9,327	$	5,705		$	4,105		$	12,905		$	33,954		$	-	$	92,880
Special Mention (7)		373			197			58		-			129			436			417			-		1,610
Substandard (8)		43			1,094			256		214			-			1,121			168			-		2,896
Total	$	13,526		$	15,065		$	9,641	$	5,919		$	4,234		$	14,462		$	34,539		$	-	$	97,386
Current period gross charge-off		-			(110	)		-		(342	)		(11	)		(601	)		-			-		(1,064	)

Consumer
Pass (1-6)	$	338		$	73		$	108	$	4		$	14		$	71		$	-		$	-	$	608
Substandard (8)		-			-			-		2			-			-			-			-		2
Total	$	338		$	73		$	108	$	6		$	14		$	71		$	-		$	-	$	610
Current period gross charge-off		(95	)		-			-		-			-			-			-			-		(95	)

Manufactured homes
Pass (1-6)	$	-		$	1,942		$	12,556	$	9,214		$	5,031		$	2,102		$	-		$	-	$	30,845
Total	$	-		$	1,942		$	12,556	$	9,214		$	5,031		$	2,102		$	-		$	-	$	30,845
Current period gross charge-off		-			-			-		-			-			-			-			-		-

Government
Pass (1-6)	$	1,890		$	1,815		$	1,433	$	-		$	-		$	4,883		$	-		$	-	$	10,021
Total	$	1,890		$	1,815		$	1,433	$	-		$	-		$	4,883		$	-		$	-	$	10,021
Current period gross charge-off		-			-			-		-			-			-			-			-		-

	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 year ended December 31, 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

868

Total

868

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

(dollars in thousands)	Total
2022	$	1,010
2023		1,078

(dollars in thousands)	Total
2024	$	673
2025		667
2026		484
2027		313
2028 and thereafter		3,068
Total	$	5,205

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 credit losses, by loan segment, is summarized below for the twelve months ended December 31, 2023:

Allowance for credit losses:
Residential real estate	$	3,021	$	1,688	$	535	$	(997	)	$	149	$	(412	)	$	3,984
Home equity		410		99		29		(43	)		-		203			698
Commercial real estate		5,784		1,003		443		(372	)		3		184			7,045
Construction and land development		1,253		1,735		-		-			-		1,218			4,206
Multifamily		1,007		141		-		-			131		(346	)		933
Commercial business		1,365		320		5		(1,064	)		265		758			1,649
Consumer		57		5		17		(95	)		15		8			7
Manufactured homes		-		112		-		-			-		69			181
Government		-		55		-		-			-		10			65
Total	$	12,897	$	5,158	$	1,029	$	(2,571	)	$	563	$	1,692		$	18,768

Allowance for loan losses:
Residential real estate	$	2,480	$	-	$	-	$	(29	)	$	53	$	517		$	3,021
Home equity		357		-		-		-			-		53			410
Commercial real estate		5,515		-		-		(431	)		-		700			5,784
Construction and land development		2,119		-		-		-			-		(866	)		1,253
Multifamily		848		-		-		-			-		159			1,007
Commercial business		2,009		-		-		(57	)		89		(676	)		1,365
Consumer		15		-		-		(91	)		20		113			57
Manufactured homes		-		-		-		-			-		-			-
Government		-		-		-		-			-		-			-
Total	$	13,343	$	-	$	-	$	(608	)	$	162	$	-		$	12,897

Schedule of Collateral Dependent Loans [Table Text Block]

(Dollars in thousands)	December 31, 2023
	Real Estate		Equipment/Inventory		Accounts Receivable		Other		Total		ACL Allocation
Residential real estate	$	30	$	-	$	-	$	-	$	-	$	30
Commercial real estate		2,541		-		-		-		2,541		53
Multifamily		4,244		-		-		-		4,244		85
Commercial business		-		1,583		1,557		192		3,332		738
	$	6,815	$	1,583	$	1,557	$	192	$	10,117	$	906

Financing Receivable, Nonaccrual [Table Text Block]

As of December 31, 2023	Nonaccrual with No Allowance for Credit Loss		Nonaccrual		Loans Past Due over 90 Days Still Accruing
Residential real estate	$	442	$	1,251	$	1,131
Home equity		161		307		-
Commercial real estate		603		230		712
Construction and land development		-		-		-
Multifamily		2,357		1,358		-
Commercial business		1,724		1,173		-
Consumer		-		2		-
Manufactured homes		-		-		-
Government		-		-		-
Total	$	5,287	$	4,321	$	1,843

	December 31, 2023
(dollars in thousands)	Interest income recognized during the period on nonaccrual loans
Residential real estate	$	173
Home equity		19
Commercial real estate		70
Construction and land development		9
Multifamily		31
Commercial business		156
Consumer		2
Total	$	460

Financing Receivable, Impairment Evaluation [Table Text Block]

	Ending Balances

(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 twelve months ended
	As of December 31, 2022						December 31, 2022
(Dollars in thousands)	Recorded Investment		Unpaid Principal Balance		Related Allowance		Average Recorded Investment		Interest Income Recognized
With no related allowance recorded:
Residential real estate	$	2,255	$	3,711	$	-	$	2,528	$	202
Home equity		399		416		-		253		12
Commercial real estate		5,314		5,406		-		3,409		205
Construction & land development		-		-		-		344		-
Multifamily		7,121		7,163		-		3,387		16
Farmland		-		-		-		-		-
Commercial business		2,278		2,392		-		1,365		76
Consumer		17		17		-		15		-
Manufactured homes		-		-		-		-		-
Government		-		-		-		-		-

With an allowance recorded:
Residential real estate	$	251	$	276	$	24	$	194	$	5
Home equity		20		20		3		21		1
Commercial real estate		13		14		13		678		-
Construction & land development		-		-		-		-		-
Multifamily		-		-		-		-		-
Farmland		-		-		-		-		-
Commercial business		433		561		297		352		13
Consumer		-		-		-		-		-
Manufactured homes		-		-		-		-		-
Government		-		-		-		-		-

Total:
Residential real estate	$	2,506	$	3,987	$	24	$	2,722	$	207
Home equity	$	419	$	436	$	3	$	274	$	13
Commercial real estate	$	5,327	$	5,420	$	13	$	4,087	$	205
Construction & land development	$	-	$	-	$	-	$	344	$	-
Multifamily	$	7,121	$	7,163	$	-	$	3,387	$	16
Farmland	$	-	$	-	$	-	$	-	$	-
Commercial business	$	2,711	$	2,953	$	297	$	1,717	$	89
Consumer	$	17	$	17	$	-	$	15	$	-
Manufactured homes	$	-	$	-	$	-	$	-	$	-
Government	$	-	$	-	$	-	$	-	$	-

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

	Year ended,
	December 31,
(Dollars in thousands)	2023
Balance, beginning of period	$	-
Adoption of ASC 326		3,108
Provision		333
Balance, end of period	$	3,441