15 unchanged sentences
OTHER INFORMATION
+Added: DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS
+Added: Not Applicable.
DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
7 unchanged sentences
PRINCIPAL ACCOUNTANT FEES AND SERVICES
+Added: Our independent registered public accounting firm for 2021 is BKD, LLP , Pittsburgh, Pennsylvania , Auditor Firm ID 686 .
+Added: Our independent registered public accounting firm for 2020 was Baker Tilly US, LLP , Pittsburgh, Pennsylvania , Auditor Firm ID 23 .
Information required by this item is incorporated by reference in the Proxy Statement for the 2022 Annual Meeting.
2 unchanged sentences
The financial statements filed as a part of this Form 10-K are:
−Removed: (A) Report of Independent Registered Public Accounting Firm;
−Removed: (B) Consolidated Statement of Financial Condition at December 31, 2020 and 2019;
−Removed: (C) Consolidated Statement of Operations for the Years Ended December 31, 2020 and 2019;
−Removed: (D) Consolidated Statement of Comprehensive Income for the Years Ended December 31, 2020 and 2019;
−Removed: (E) Consolidated Statement of Changes in Stockholders’ Equity for the Years Ended December 31, 2020 and 2019;
−Removed: (F) Consolidated Statement of Cash Flows for the Years Ended December 31, 2020 and 2019;
+Added: (A) Reports of Independent Registered Public Accounting Firms;
+Added: (B) Consolidated Statements of Financial Condition at December 31, 2021 and 2020;
+Added: (C) Consolidated Statements of Income (Loss) for the Years Ended December 31, 2021 and 2020;
+Added: (D) Consolidated Statements of Comprehensive Income for the Years Ended December 31, 2021 and 2020;
+Added: (E) Consolidated Statements of Changes in Stockholders’ Equity for the Years Ended December 31, 2021 and 2020;
+Added: (F) Consolidated Statements of Cash Flows for the Years Ended December 31, 2021 and 2020;
(G) Notes to Consolidated Financial Statements.
5 unchanged sentences
4.1 Form of Stock Certificate of CB Financial Services, Inc.
−Removed: 4.2 Description of Registrant's Securities
+Added: 4.2 Description of Registrant's Securitie s (3)
10.1 Employment Agreement by and between Community Bank and John H.
4 unchanged sentences
Boyer dated April 14, 2014 (1)
−Removed: 10.5 Employment Agreement by and between Community Bank and Ralph J.
−Removed: 10.6 E xecutive Consultant Agreement by and among CB Financial Services, Inc., Community Bank and Barron P.
−Removed: 10.7 Separation and Release Agreement by and among CB Financial Services, Inc., between Community Bank and Patrick G.
−Removed: O’Brien ( 8 )
10.8 Split Dollar Life Insurance Agreement by and between Community Bank and John H.
4 unchanged sentences
10.12 Amendment dated as of September 13, 2005, to the Life Insurance Endorsement Method Split Dollar Plan Agreement by and between First Federal Savings Bank and Richard B.
−Removed: 10.13 Split Dollar Life Insurance Agreement by and between Community Bank and Ralph J.
−Removed: Sommers, Jr., dated April 1, 2005 (1)
−Removed: 10.14 Split Dollar Life Insurance Agreement by and between Community Bank and Barron P.
−Removed: McCune, Jr., dated April 1, 2005 (1)
10.15 CB Financial Services, Inc., 2015 Equity Incentive Plan ( 1 1 )
+Added: 10.16 CB Financial Services, Inc., 2021 Equity Incentive Plan ( 1 2 )
+Added: 10.17 Subordinated Note Purchase Agreement (13)
21 Subsidiaries
+Added: 23.1 Consent of BKD, LLP
23.2 Consent of Baker Tilly US, LLP
3 unchanged sentences
101.0 The following materials for the year ended December 31, 2021, formatted in XBRL (Extensible Business Reporting Language):
−Removed: (i) the Consolidated Statement of Financial Condition, (ii) the Consolidated Statement of Operations, (iii) the Consolidated Statement of Comprehensive Income, (iv) the Consolidated Statement of Changes in Stockholders’ Equity, (v) the Consolidated Statement of Cash Flows and (vi) the Notes to the Audited Consolidated Financial Statements.
+Added: (i) the Consolidated Statements of Financial Condition, (ii) the Consolidated Statements of Income (Loss), (iii) the Consolidated Statements of Comprehensive Income, (iv) the Consolidated Statements of Changes in Stockholders’ Equity, (v) the Consolidated Statements of Cash Flows and (vi) the Notes to the Audited Consolidated Financial Statements.
104 Cover Page Interactive Data File (embedded in Inline XBRL contained in Exhibit 101)
1 unchanged sentence
(2) Incorporated herein by reference to Exhibit 3.2 to the Company's Current Report on Form 8-K filed with the Securities and Exchange Commission on May 20, 2021.
+Added: (3) Incorporated herein by reference to Exhibit 4.2 to the Company’s Form 10-K for the year ended December 31, 2020, filed on March 17, 2021.
(4) Incorporated herein by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed on August 14, 2020.
1 unchanged sentence
(6) Incorporated herein by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed on May 24, 2020.
−Removed: (6) Incorporated herein by reference to Exhibit 10.4 to the Company’s Form 10-K for the year ended December 31, 2014, filed on March 26, 2015.
−Removed: (7) Incorporated herein by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K, filed on August 14, 2020.
−Removed: (8) Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed on January 9, 2020.
(7) Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed on November 6, 2020.
4 unchanged sentences
(11) Incorporated herein by reference to Appendix A to the Company’s Definitive Proxy Statement, filed on April 16, 2015.
+Added: (12) Incorporated herein by reference to Appendix A to the Company’s Definitive Proxy Statement, filed on April 9, 2021.
+Added: (13) Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed on December 10, 2021.
FORM 10-K SUMMARY
28 unchanged sentences
March 11, 2022
−Removed: /s/ William C.
/s/ Joseph N.
−Removed: Groves Joseph N.
−Removed: Director Director
−Removed: March 17, 2021 Date:
−Removed: March 17, 2021
−Removed: /s/ Roberta Robinson Olejasz
−Removed: LaCarte Roberta Robinson Olejasz
+Added: Headlee John J.
Director Director
1 unchanged sentence
March 11, 2022
+Added: /s/ Roberta Robinson Olejasz By:
/s/ William G.
−Removed: Petroplus By:
−Removed: Petroplus David F.
+Added: Roberta Robinson Olejasz William G.
Director Director
1 unchanged sentence
March 11, 2022
+Added: Pollock John M.
Director Director
2 unchanged sentences
CONSOLIDATED FINANCIAL STATEMENTS
−Removed: Report of Independent Registered Public Accounting Firm
−Removed: Consolidated Statement of F inancia l Condition a t December 31, 2020 and 2019
−Removed: Consolidated Statement of Operations for the Years Ended December 31, 2020 and 2019
−Removed: Consolidated Statement of Comprehensive Income for the Years Ended December 31, 2020 and 2019
−Removed: Consolidated Statement of Changes in Stockholders’ Equity for the Years Ended December 31, 2020 and 2019
−Removed: Consolidated Statement of Cash Flows for the Years Ended December 31, 2020 and 2019
+Added: Report s of Independent Registered Public Accounting Firm
+Added: Consolidated Statement s of Financial Condition at December 31, 2021 and 2020
+Added: Consolidated Statement s of Operations for the Years Ended December 31, 2021 and 2020
+Added: Consolidated Statement s of Comprehensive Income (Loss) for the Years Ended December 31, 2021 and 2020
+Added: Consolidated Statement s of Changes in Stockholders’ Equity for the Years Ended December 31, 2021 and 2020
+Added: Consolidated Statement s of Cash Flows for the Years Ended December 31, 2021 and 2020
Notes to Consolidated Financial Statements
Report of Independent Registered Public Accounting Firm
+Added: To the Stockholders, Board of Directors and Audit Committee
+Added: CB Financial Services, Inc.
+Added: Carmichaels, Pennsylvania
+Added: Opinion on the Financial Statements
+Added: We have audited the accompanying consolidated statement of financial condition of CB Financial Services, Inc.
+Added: (Company) as of December 31, 2021, the related consolidated statements of income (loss), comprehensive income (loss), changes in stockholders’ equity and cash flows for the year ended December 31, 2021, and the related notes (collectively referred to as the financial statements).
+Added: In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2021, and the results of its operations and its cash flows for the year ended December 31, 2021, in conformity with accounting principles generally accepted in the United States of America.
+Added: Basis for Opinion
+Added: These financial statements are the responsibility of the Company’s management.
+Added: Our responsibility is to express an opinion on the Company’s financial statements based on our audit.
+Added: We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S.
+Added: federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
+Added: We conducted our audit in accordance with the standards of the PCAOB.
+Added: Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.
+Added: Our audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks.
+Added: Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.
+Added: Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements.
+Added: We believe that our audit provides a reasonable basis for our opinion.
+Added: Critical Audit Matter
+Added: The critical audit matter communicated below is a matter arising from the current-period audit of the financial statements that was communicated or required to be communicated to the audit committee and that:
+Added: (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective or complex judgments.
+Added: The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.
+Added: Allowance for Loan Losses
+Added: As described in Note 4 to the financial statements, the Company’s allowance for loan and lease losses (ALLL) was $11.58 million at December 31, 2021.
+Added: The Company also describes in Note 1 of the financial statements the "Allowance for Loan Losses" accounting policy around this estimate.
+Added: The allowance for loan losses is evaluated on a regular basis by management and is based on management’s periodic review of the collectability of loans in light of historical experiences, the nature and volume of the loan portfolio, adverse situations that may affect the borrower’s ability to repay, estimated value of any underlying collateral, and prevailing economic conditions.
+Added: The allowance consists of specific, general and unallocated components.
+Added: The specific component relates to loans that are classified as impaired and an allowance is established when the discounted cash flows (or collateral value) of the impaired loan is lower than the carrying value of that loan.
+Added: The general component covers non-classified loans and is based on historical loss experience adjusted for qualitative factors.
+Added: The unallocated component is maintained to cover uncertainties that could affect management’s estimate of probable losses.
+Added: We identified the valuation of the ALLL as a critical audit matter.
+Added: Auditing the allowance for loan losses involved significant judgement and complex review as there is a high degree of subjectivity in evaluating management’s estimate, such as evaluating management's assessment of economic conditions and other environmental factors, evaluating the adequacy of specific allowances associated with impaired loans and assessing the appropriateness of loan grades.
+Added: Our audit procedures related to the estimated allowance for loan losses included:
+Added: • Testing the design effectiveness of internal controls, including those related to technology, over the ALLL including data completeness and accuracy, classifications of loans by loan segment, historical loss data, the calculation of a loss rate, the establishment of qualitative adjustments, grading and risk classification of loans, establishment of specific reserves on impaired loans, and management’s review controls over the ALLL balance as a whole
+Added: • Testing clerical and computational accuracy of the formulas within the Company’s ALLL calculation
+Added: • Testing of completeness and accuracy of the underlying data utilized in the ALLL, including reports used in management review controls over the ALLL
+Added: • Testing of the loan review function and the reasonableness of loan grades determined.
+Added: Specifically, utilizing internal loan review professionals to assist us in evaluating the appropriateness of loan grades and to assess the reasonableness of specific impairments on impaired loans
+Added: • Evaluating the overall reasonableness of qualitative factor adjustments to historical loss, and the appropriateness of their direction and magnitude, and the Company’s support for the direction and magnitude compared to previous years
+Added: We have served as the Company’s auditor since 2021.
+Added: Pittsburgh, Pennsylvania
+Added: March 11, 2022
+Added: Report of Independent Registered Public Accounting Firm
To the Stockholders and Board of Directors of
1 unchanged sentence
Opinion on the Financial Statements
−Removed: We have audited the accompanying consolidated statements of financial condition of CB Financial Services, Inc.
−Removed: and Subsidiary (the Company) as of December 31, 2020 and 2019, and the related consolidated statements of operations, comprehensive (loss) income, changes in stockholders' equity, and cash flows, for the years then ended, and the related notes (collectively referred to as the consolidated financial statements).
−Removed: In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2020 and 2019, and the results of its operations and its cash flows for the years then ended, in conformity with accounting principles generally accepted in the United States of America.
+Added: We have audited the accompanying consolidated statement of financial condition of CB Financial Services, Inc.
+Added: and Subsidiary (the Company) as of December 31, 2020, and the related consolidated statements of operations, comprehensive loss, changes in stockholders' equity, and cash flows, for the year then ended, and the related notes (collectively referred to as the consolidated financial statements).
+Added: In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2020, and the results of its operations and its cash flows for the year then ended, in conformity with accounting principles generally accepted in the United States of America.
Basis for Opinion
These consolidated financial statements are the responsibility of the Company's management.
−Removed: Our responsibility is to express an opinion on the Company's consolidated financial statements based on our audits.
+Added: Our responsibility is to express an opinion on the Company's consolidated financial statements based on our audit.
We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S.
federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
−Removed: We conducted our audits in accordance with the standards of the PCAOB.
+Added: We conducted our audit in accordance with the standards of the PCAOB.
Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud.
The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting.
−Removed: As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting.
+Added: As part of our audit we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting.
Accordingly, we express no such opinion.
−Removed: Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks.
+Added: Our audit included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks.
Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements.
−Removed: Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements.
−Removed: We believe that our audits provide a reasonable basis for our opinion.
−Removed: Critical Audit Matters
−Removed: The critical audit matters communicated below are matters arising from the current period audit of the consolidated financial statements that were communicated or required to be communicated to the audit committee and that:
−Removed: (1) relate to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments.
−Removed: The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.
−Removed: Allowance For Loan Losses – Qualitative Factors – Refer to Notes 1 and 4 to the Consolidated Financial Statements
−Removed: Critical Audit Matter Description
−Removed: As disclosed in Note 4 to the Company's consolidated financial statements, the Company's loan portfolio totaled $1,044,753,000 as of December 31, 2020, and the related allowance for loan losses was $12,771,000.
−Removed: As described in Note 1 and 4, the allowance for loan losses consists of two components:
−Removed: (1) the specific component, consisting of the valuation allowance for loans individually evaluated for impairment (“specific component”), representing $649,000;
−Removed: and (2) the general component, consisting of the valuation allowance for pools of loans with similar risk characteristics collectively evaluated for impairment (“general component”), representing $12,122,000.
−Removed: The general component is further broken down between reserves assigned to each pool of loans based on both historical net charge-off experience ($2,098,000), and qualitative and environmental factors ($10,024,000) (“qualitative factors”) for changes not reflected in the historical loss experience.
−Removed: The determination of the qualitative factors adjustments involves significant estimates based on subjective assumptions that require a high degree of management judgment relating to how those assumptions impact probable incurred credit losses within the loan portfolio.
−Removed: Management has designed and evaluated the following qualitative factors:
−Removed: (1) levels and trends in delinquency and impaired loans;
−Removed: (2) levels and trends in net charge-offs, (3) trends in volume and terms of loans;
−Removed: (4) change in underwriting, policies, procedures, practices and key personnel;
−Removed: (5) national and local economic trends;
−Removed: (6) industry conditions,
−Removed: and (7) effects of changes in high-risk credit circumstances.
−Removed: Changes in these assumptions could have a material effect on the allowance for loan losses.
−Removed: The allowance for loan losses is an accounting estimate with significant measurement uncertainty and involves the application of significant judgment by management.
−Removed: Therefore, a high degree of auditor judgment and significant auditor effort was required in evaluating the audit evidence obtained related to the qualitative factor adjustments used by management in the calculation.
−Removed: We identified the estimate of the general reserves qualitative factors of the allowance for loan losses as a critical audit matter as it involved especially subjective auditor judgment.
−Removed: How the Critical Audit Matter was Addressed in the Audit
−Removed: The primary procedures we performed to address this critical audit matter included:
−Removed: • Testing the design and operating effectiveness of internal controls relating to the evaluation of the assumptions and inputs used to evaluate the qualitative loss factors, including controls addressing:
−Removed: ◦ Management's review of the underlying data inputs used in the determination of qualitative loss factor adjustments for completeness and accuracy.
−Removed: ◦ Management's determination of impaired loans that have been excluded from the general reserve component of the allowance for loan losses.
−Removed: ◦ Management's review of the conclusions reached related to the qualitative and quantitative loss factors and the resulting allocation to the allowance for loan losses.
−Removed: • Substantively testing the appropriateness of the judgments and assumptions used in management's estimation process for developing the qualitative loss factor adjustments, including:
−Removed: ◦ Assessing whether all relevant factors have been considered that affect the collectability of the loan portfolio.
−Removed: ◦ Evaluating the completeness, accuracy, and relevance of underlying internal and external data inputs used as a basis for the qualitative loss factor adjustments and corroborating these inputs by comparing to the Company's lending practices, historical loan portfolio performance, and third-party macroeconomic data.
−Removed: ◦ Evaluating the propriety of impaired loans excluded from the general reserve component of the allowance for loan losses.
−Removed: ◦ Testing the mathematical accuracy of the allocation of qualitative loss factors to the appropriate loan categories.
−Removed: Goodwill Impairment Evaluation – Refer to Notes 1 and 6 to the Consolidated Financial Statements
−Removed: Critical Audit Matter Description
−Removed: For the year ended December 31, 2020, the Company recorded a pre-tax goodwill impairment charge of $18.7 million, which relates to the Company's community banking reporting unit.
−Removed: As discussed in Notes 1 and 6 to the consolidated financial statements, goodwill is tested for impairment on the basis of community banking reporting unit at least annually, or more frequently as events occur or circumstances change.
−Removed: In the third quarter of fiscal year 2020, the Company assessed relevant events and circumstances and determined it was appropriate to perform an impairment test.
−Removed: In performing the test, management used both a market capitalization approach and discounted cash flow approach to determine the estimated fair value of the community banking reporting unit.
−Removed: The results of these two approaches were equally weighted at 50% each.
−Removed: As a result of this analysis, management determined that the carrying value of the community banking reporting unit exceeded its fair value resulting in the recognition of a goodwill impairment charge.
−Removed: Auditing management's goodwill impairment test was complex and highly judgmental due to the significant estimation required to determine the estimated fair value of the community banking reporting unit.
−Removed: In particular, the fair value estimate was sensitive to significant assumptions, such as changes in the Company's financial forecast, the discount rate, cost synergies and terminal growth rate, which are affected by expectations about future market or economic conditions, including uncertainty resulting from the COVID-19 pandemic.
−Removed: How the Critical Audit Matter was Addressed in the Audit
−Removed: The primary procedures we performed to address this critical audit matter included:
−Removed: • Testing the design and operating effectiveness of internal controls relating to the evaluation of the assumptions and inputs used to estimate the fair value of the Company's community banking reporting unit, including controls addressing:
−Removed: ◦ Management's review of the accuracy and reasonableness of the prospective financial information used in the discounted cash flow analysis.
−Removed: ◦ Management's evaluation of the key assumptions and inputs used by a third-party valuation specialist, including discount rate, terminal growth rate, control premium, and market comparable entities, as well as the weighting assigned to each of the valuation methodologies used to determine fair value.
−Removed: • Substantively testing, with the support of auditor employed valuation specialists, the appropriateness of the judgments and assumptions used in management's estimation process for determining the fair value of the Company's community banking reporting unit including:
−Removed: ◦ Testing the mathematical accuracy of the calculations performed.
−Removed: ◦ Assessing the historical accuracy of management's financial forecasts by comparing prior budgets to actual results.
−Removed: ◦ Evaluating the appropriateness of the valuation methodologies used, discount rate, cost synergies, terminal growth rate, control premium, market comparable entities and overall reasonableness of the fair value calculation.
−Removed: ◦ Comparing the significant assumptions used by management to current industry and economic trends, current and historical performance of the community banking reporting unit, and other relevant factors.
−Removed: ◦ Performing sensitivity analyses to evaluate the impact that changes in the significant assumptions used by management would have on the fair value of the reporting unit.
−Removed: ◦ Testing management's reconciliation of the fair value of the reporting unit to the market capitalization of the Company.
+Added: Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements.
+Added: We believe that our audit provides a reasonable basis for our opinion.
/s/ Baker Tilly US, LLP
−Removed: We have served as the Company's auditor since 2006.
−Removed: Baker Tilly US, LLP (formerly known as Baker Tilly Virchow Krause, LLP)
+Added: We served as the Company's auditor from 2006 to 2021.
Pittsburgh, Pennsylvania
March 17, 2021
−Removed: Consolidated Statement of Financial Condition
+Added: CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
December 31, 2021 2020
38 unchanged sentences
The accompanying notes are an integral part of these consolidated financial statements
−Removed: Consolidated Statement of Operations
+Added: CONSOLIDATED STATEMENTS OF INCOME (LOSS)
Year Ended December 31, 2021 2020
12 unchanged sentences
TOTAL INTEREST EXPENSE 3,405 5,563
−Removed: NET INTEREST INCOME 41,904 43,174
−Removed: Provision For Loan Losses 4,000 725
−Removed: NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES 37,904 42,449
+Added: NET INTEREST AND DIVIDEND INCOME 40,152 41,904
+Added: (Recovery) Provision For Loan Losses ( 1,125 ) 4,000
+Added: NET INTEREST AND DIVIDEND INCOME AFTER (RECOVERY) PROVISION FOR LOAN LOSSES 41,277 37,904
NONINTEREST INCOME
5 unchanged sentences
Net Gain on Purchased Tax Credits 70 62
−Removed: Net (Loss) Gain on Disposal of Fixed Assets ( 61 ) 2
+Added: Gain on Sale of Branches 5,203 —
+Added: Net Loss on Disposal of Premises and Equipment ( 3 ) ( 61 )
Income from Bank-Owned Life Insurance 553 557
−Removed: Other (Loss) Income ( 274 ) 186
+Added: Other Income (Loss) 320 ( 274 )
TOTAL NONINTEREST INCOME 16,280 9,471
4 unchanged sentences
Data Processing 2,154 1,843
−Removed: FDIC Assessment 837 411
−Removed: PA Shares Tax 1,313 999
+Added: Federal Deposit Insurance Corporation Assessment 1,014 837
+Added: Pennsylvania Shares Tax 887 1,313
Contracted Services 4,011 2,048
−Removed: Legal Fees 752 688
+Added: Legal and Professional Fees 994 752
Advertising 749 664
Other Real Estate Owned (Income) ( 183 ) ( 69 )
−Removed: Amortization of Core Deposit Intangible 2,128 2,127
−Removed: Goodwill Impairment 18,693 —
−Removed: Writedown of Fixed Assets 1,124 —
+Added: Amortization of Intangible Assets 1,926 2,128
+Added: Goodwill and Intangible Assets Impairment 1,178 18,693
+Added: Writedown on Premises and Equipment 2,293 1,124
Other 3,899 3,893
TOTAL NONINTEREST EXPENSE 42,862 56,767
−Removed: (Loss) Income Before Income Tax Expense ( 9,392 ) 16,056
+Added: INCOME (LOSS) BEFORE INCOME TAX EXPENSE 14,695 ( 9,392 )
Income Tax Expense 3,125 1,248
−Removed: NET (LOSS) INCOME $ ( 10,640 ) $ 14,327
−Removed: (LOSS) EARNINGS PER SHARE
+Added: NET INCOME (LOSS) $ 11,570 $ ( 10,640 )
+Added: EARNINGS (LOSS) PER SHARE
Basic $ 2.15 $ ( 1.97 )
4 unchanged sentences
The accompanying notes are an integral part of these consolidated financial statements
−Removed: Consolidated Statement of Comprehensive (Loss) Income
+Added: CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
Year Ended December 31, 2021 2020
(Dollars in Thousands)
−Removed: Net (Loss) Income $ ( 10,640 ) $ 14,327
+Added: Net Income (Loss) $ 11,570 $ ( 10,640 )
Other Comprehensive Income:
−Removed: Change in Unrealized Gain on Available-for-Sale Debt Securities 1,446 5,151
+Added: Change in Unrealized (Loss) Gain on Available-for-Sale Debt Securities ( 5,288 ) 1,446
Income Tax Effect 1,136 ( 304 )
−Removed: Reclassification Adjustment for (Gain) Loss on Sale of Debt Securities Included in Net (Loss) Income (1)
+Added: Reclassification Adjustment for Gain on Sale of Debt Securities Included in Net Income (Loss) (1)
+Added: ( 225 ) ( 489 )
Income Tax Effect (2)
−Removed: Other Comprehensive Income, Net of Income Tax Effect 756 4,086
−Removed: Total Comprehensive (Loss) Income $ ( 9,884 ) $ 18,413
−Removed: (1) Reported in Net Gain on Securities on the Consolidated Statement of Operations.
−Removed: (2) Reported in Income Taxes on the Consolidated Statement of Operations.
+Added: Other Comprehensive (Loss) Income, Net of Income Tax Effect ( 4,329 ) 756
+Added: Total Comprehensive Income (Loss) $ 7,241 $ ( 9,884 )
+Added: (1) Reported in Net Gain on Securities on the Consolidated Statements of Income (Loss).
+Added: (2) Reported in Income Tax Expense on the Consolidated Statements of Income (Loss).
The accompanying notes are an integral part of these consolidated financial statements
−Removed: Consolidated Statement of Changes in Stockholders’ Equity
+Added: CONSOLIDATED STATEMENTS OF CHANGES
+Added: IN STOCKHOLDERS' EQUITY
Issued Common
7 unchanged sentences
December 31, 2019 5,680,993 $ 2,367 $ 82,971 $ 66,955 $ ( 3,842 ) $ 2,646 $ 151,097
−Removed: Net Income — — — 14,327 — — 14,327
+Added: Net Loss — — — ( 10,640 ) — — ( 10,640 )
Other Comprehensive Income — — — — — 756 756
8 unchanged sentences
December 31, 2020 5,680,993 $ 2,367 $ 82,723 $ 51,132 $ ( 5,094 ) $ 3,402 $ 134,530
−Removed: Net Loss — — — ( 10,640 ) — — ( 10,640 )
−Removed: Other Comprehensive Income — — — — — 756 756
+Added: Net Income — — — 11,570 — — 11,570
+Added: Other Comprehensive Loss — — — — — ( 4,329 ) ( 4,329 )
Restricted Stock Awards Forfeited — — 9 — ( 9 ) — —
−Removed: Restricted Stock Awards Granted — — ( 869 ) — 869 — —
Stock-Based Compensation Expense — — 566 — — — 566
6 unchanged sentences
The accompanying notes are an integral part of these consolidated financial statements
−Removed: Consolidated Statement of Cash Flows
+Added: CONSOLIDATED STATEMENTS OF CASH FLOWS
Year Ended December 31, 2021 2020
2 unchanged sentences
Net (Loss) Income $ 11,570 $ ( 10,640 )
−Removed: Adjustments to Reconcile Net (Loss) Income to Net Cash Provided By Operating Activities:
−Removed: Net Amortization (Accretion) on Securities 24 ( 182 )
+Added: Adjustments to Reconcile Net Income (Loss) to Net Cash Provided By Operating Activities:
+Added: Net Amortization on Securities 52 24
Depreciation and Amortization 2,435 3,340
−Removed: Provision for Loan Losses 4,000 725
+Added: (Recovery) Provision for Loan Losses ( 1,125 ) 4,000
+Added: Other Intangible Asset Impairment 1,178 —
Goodwill Impairment — 18,693
−Removed: Writedown on Fixed Assets 1,124 —
−Removed: Loss (Gain) on Equity Securities 267 ( 190 )
−Removed: (Gain) Loss on Securities ( 500 ) 50
+Added: Writedown on Premises and Equipment 2,293 1,124
+Added: Lease Impairment 227 —
+Added: Gain on Securities ( 526 ) ( 233 )
+Added: Gain on Sale of Branches ( 5,203 ) —
Gain on Purchased Tax Credits ( 70 ) ( 62 )
3 unchanged sentences
Gain on Sales of Loans ( 1,143 ) ( 1,391 )
−Removed: Loss on Sales of Other Real Estate Owned 18 6
+Added: (Gain) Loss on Sales of Other Real Estate Owned ( 80 ) 18
Noncash Expense for Stock-Based Compensation 566 498
−Removed: (Increase) Decrease in Accrued Interest Receivable ( 575 ) 139
−Removed: Loss (Gain) on Disposal of Fixed Assets 61 ( 2 )
+Added: Decrease (Increase) in Accrued Interest Receivable 522 ( 575 )
+Added: Loss on Disposal of Premises and Equipment 3 61
Decrease in Deferred Income Tax ( 248 ) ( 237 )
−Removed: (Decrease) Increase in Taxes Payable ( 858 ) 411
+Added: Increase (Decrease) in Taxes Payable 1,888 ( 858 )
Payments on Operating Leases — ( 515 )
−Removed: (Decrease) Increase in Accrued Interest Payable ( 220 ) 393
+Added: Decrease in Accrued Interest Payable ( 281 ) ( 220 )
Other, Net 1,227 216
5 unchanged sentences
Proceeds from Sales of Securities 11,967 18,002
−Removed: Net Increase in Loans ( 89,594 ) ( 44,272 )
+Added: Proceeds from Loans Sold 12,371 —
+Added: Net Decrease (Increase) in Loans 12,737 ( 89,594 )
Purchase of Premises and Equipment ( 2,385 ) ( 322 )
Proceeds from Disposal of Premises and Equipment 845 26
−Removed: Asset Acquisition of a Customer List — ( 900 )
Proceeds From Sales of Other Real Estate Owned 325 171
−Removed: Decrease in Restricted Equity Securities ( 328 ) 253
−Removed: Acquisition of Bank-Owned Life Insurance — ( 750 )
+Added: Decrease (Increase) in Restricted Equity Securities 582 ( 328 )
NET CASH USED IN INVESTING ACTIVITIES ( 60,138 ) ( 36,896 )
1 unchanged sentence
Net Increase in Deposits 104,843 106,210
−Removed: Net Increase (Decrease) in Short-Term Borrowings 10,484 ( 408 )
+Added: Sale of Deposits, Net of Purchase Premium ( 97,596 ) —
+Added: (Decrease) Increase in Short-Term Borrowings ( 1,789 ) 10,484
Principal Payments on Other Borrowed Funds ( 5,000 ) ( 6,000 )
+Added: Proceeds from Issuance of Subordinated Debt, Net of Debt Issuance Costs 14,601 —
Cash Dividends Paid ( 5,168 ) ( 5,183 )
2 unchanged sentences
NET CASH PROVIDED BY FINANCING ACTIVITIES 5,846 103,513
−Removed: INCREASE IN CASH AND CASH EQUIVALENTS 80,694 26,864
+Added: (DECREASE) INCREASE IN CASH AND DUE FROM BANKS ( 41,237 ) 80,694
CASH AND DUE FROM BANKS AT BEGINNING OF THE YEAR 160,911 80,217
1 unchanged sentence
The accompanying notes are an integral part of these consolidated financial statements
+Added: Year Ended December 31, 2021 2020
+Added: (Dollars in Thousands)
SUPPLEMENTAL CASH FLOW INFORMATION:
6 unchanged sentences
Non-cash Transaction for Income Tax Receivable — 1,311
−Removed: Non-cash Transaction Related to Loan Payoff Receivable — 3,490
Right of Use ("ROU") Asset Recognized — 435
11 unchanged sentences
The Company provides banking services through its subsidiary, Community Bank, a Pennsylvania-chartered commercial bank headquartered in Carmichaels, Pennsylvania.
−Removed: The Bank operates from 15 offices in Greene, Allegheny, Washington, Fayette and Westmoreland Counties in southwestern Pennsylvania, six offices in Brooke, Marshall, Ohio, Upshur and Wetzel Counties in West Virginia, and one office in Belmont County in Ohio.
The Bank is a community-oriented institution offering residential and commercial real estate loans, commercial and industrial loans, and consumer loans as well as a variety of deposit products for individuals and businesses in its market area.
+Added: After the consolidation of six and sale of two branches in 2021 and consolidation of two branches in 2020, the Bank operates from 11 offices in Greene, Allegheny, Washington, Fayette and Westmoreland Counties in southwestern Pennsylvania and three offices in Marshall and Ohio Counties in West Virginia.
Property and casualty, commercial liability, surety and other insurance products are offered through Exchange Underwriters, a full-service, independent insurance agency.
The Company has evaluated events and transactions occurring subsequent to the balance sheet date of December 31, 2021 through the date the consolidated financial statements are being issued for items that should potentially be recognized or disclosed in these consolidated financial statements.
−Removed: As previously disclosed by the Company on February 23, 2021, the Company announced the implementation of strategic initiatives to improve the Bank’s financial performance and to position the Bank for continued profitable growth.
−Removed: The Bank intends to optimize its current branch network through the consolidation of six branches and the possible divestiture of others, while expanding technology and infrastructure investments in its remaining locations.
−Removed: The decision was the result of a comprehensive internal study that measured branch performance by comparing financial and non-financial indicators to growth opportunities, while evolving changes in consumer preferences, largely driven by the global pandemic, led to an acceleration of branch optimization efforts.
−Removed: The branch optimization, which is expected to be completed in 2021, will result in the Company incurring restructuring related expenses predominantly from branch consolidations, lease termination and severance costs.
Use of Estimates
1 unchanged sentence
GAAP”) and with general practice within the banking industry.
−Removed: In preparing the financial statements, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the Consolidated Statement of Financial Condition, and income and expenses for the period.
+Added: In preparing the financial statements, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the Consolidated Statements of Financial Condition, and income and expenses for the period.
Actual results could differ significantly from those estimates.
2 unchanged sentences
In March 2020, the World Health Organization declared the outbreak of COVID-19 a global pandemic.
−Removed: The COVID-19 pandemic has adversely affected, and may continue to adversely affect, local, national and global economic activity.
+Added: Since then, the COVID-19 pandemic has continued to evolve and mutate, including through its variants, and has adversely affected, and may continue to adversely affect, local, national and global economic activity.
+Added: Actions taken to help mitigate the spread of COVID-19 include restrictions on travel, localized quarantines, and government-mandated closures of certain businesses.
+Added: While some of these restrictions have been eliminated or relaxed, these same or new restrictions may be implemented again.
+Added: Although vaccines for COVID-19 have largely been made available in the U.S., the ultimate efficacy of the vaccines will depend on various factors, including, without limitation, the number of people who receive the vaccines as well as the vaccines’ effectiveness against contracting and spreading COVID-19 and any of its existing or new variants.
The spread of the outbreak has caused significant disruptions to the U.S.
−Removed: economy, significant reductions in the targeted federal funds rate and has disrupted banking and other financial activity in the areas in which the Company operates.
+Added: economy, significant reductions in the targeted federal funds rate by the Federal Open Market Committee, and has disrupted the financial industry and real estate markets in the areas in which the Company operates, and it may continue to do so.
+Added: Our net interest income is influenced by both the pricing and mix of our interest-earning assets and our interest-bearing liabilities which, in turn, are impacted by such external factors as the monetary policy of the Federal Open Market Committee.
+Added: We are unable to predict changes in market interest rates, including the targeted federal funds interest rate, which are affected by many factors beyond our control.
On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) was enacted to, among other provisions, provide emergency assistance for individuals, families and businesses affected by the COVID-19 pandemic.
On December 27, 2020, the Consolidated Appropriations Act (2021) was enacted and provides an additional $900 billion in pandemic-related relief aimed to bolster the economy, provide relief to small businesses and the unemployed, deliver additional stimulus checks to individuals and provide funding for COVID-19 testing and the administration of vaccines while also extending certain provisions of the original CARES Act stimulus package.
−Removed: The reduction in interest rates and other effects of the COVID-19 pandemic may continue to materially and adversely affect the Company's financial condition and results of operations in future periods.
−Removed: It is unknown how long the adverse conditions
+Added: Although the CARES Act and Consolidated
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
−Removed: associated with the COVID-19 pandemic will last and what the complete financial effect will be to the Company.
+Added: Appropriations Act provided some relief to individuals, families and businesses, the negative impact of COVID-19 remains.
+Added: The reduction in interest rates and other effects of the COVID-19 pandemic may continue to materially and adversely affect the Company's financial condition and results of operations in future periods.
+Added: It is unknown how long the adverse conditions associated with the COVID-19 pandemic will last and what the complete financial effect will be to the Company.
It is possible that estimates made in the financial statements could be materially and adversely impacted as a result of these conditions, including estimates regarding the allowance for loan losses, impairment of loans, impairment of securities and additional impairment of goodwill.
1 unchanged sentence
however, COVID-19 could potentially create widespread business continuity issues for the Company.
−Removed: The extent to which the COVID-19 pandemic will continue to impact the Company’s business, financial condition and results of operations in future periods will depend on future developments, including the scope and duration of the pandemic and and additional actions taken by governmental authorities and other third parties in response to the pandemic, as well as further actions the Company may take as may be required by government authorities or that the Company determines is in the best interests of its employees and clients.
+Added: The extent to which the COVID-19 pandemic may continue to impact the Company’s business, financial condition and results of operations in future periods will depend on future developments, including the scope and duration of the pandemic and additional actions taken by governmental authorities and other third parties in response to the pandemic, as well as further actions the Company may take as may be required by government authorities or that the Company determines is in the best interests of its employees and clients.
There is no certainty that such measures will be sufficient to mitigate the risks posed by the pandemic.
9 unchanged sentences
The Company earns fees from its deposit customers for transaction-based, account maintenance, and overdraft services.
−Removed: Transaction-based fees include services fees for ATM usage, stop payment charges, statement production, ACH and wire fees, which are recognized into income at the occurrence of an executed transaction and the point in time the Company fulfills the customer’s request.
+Added: Transaction-based fees include services fees for ATM usage, stop payment charges, statement production, ACH and wire transfers, which are recognized into income at the occurrence of an executed transaction and the point in time the Company fulfills the customer’s request.
Account maintenance fees, which are primarily based on monthly maintenance activities, are earned over the course of the month, and satisfy the Company’s performance obligation.
19 unchanged sentences
These fees fulfill the contract/agreement between the Company and the wealth management firm.
−Removed: Check sales are recognized as customers contact the Company for check supplies or the customer initiates the check order through the Company website to our third-party check company.
−Removed: These commissions are recognized as the third-party check company satisfies the contract of providing check stock to our customers.
−Removed: Safe deposit box rental income is recognized on a monthly basis, per each contract agreement with our
+Added: Check sales are recognized as customers contact the Company for
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
+Added: check supplies or the customer initiates the check order through the Company website to our third-party check company.
+Added: These commissions are recognized as the third-party check company satisfies the contract of providing check stock to our customers.
+Added: Safe deposit box rental income is recognized on a monthly basis, per each contract agreement with our customers.
The safe deposit box income is automatically withdrawn from the customer’s deposit account on a monthly basis as this revenue is earned by the contract.
−Removed: Gains (Losses) on Sales of OREO :
+Added: Gains (Losses) on Sales of Other Real Estate Owned ("OREO") :
The Company records a gain or loss from the sale of OREO when control of the property transfers to the buyer, which generally occurs at the time of an executed deed.
7 unchanged sentences
See Note 19 – Segment Reporting and Related Information for more information.
+Added: Cash and Due From Banks
+Added: The Company has defined cash and due from banks as cash on hand and those amounts due from depository institutions, interest-bearing deposits with other banks with original maturities of less than 90 days, and federal funds sold.
+Added: The Company maintains cash deposits in other depository institutions that occasionally exceed the amount of deposit insurance available.
+Added: Management periodically assesses the financial condition of these institutions and believes that the risk of any possible credit loss is minimal.
+Added: Generally, the Company is required to maintain average reserve balances in vault cash with the Federal Reserve Bank based upon outstanding balances of deposit transaction accounts.
+Added: However, as announced on March 15, 2020, the Federal Reserve Board reduced reserve requirement ratios to zero percent, effective March 26, 2020, in light of the shift to an ample reserves regime.
+Added: This action eliminates the need to maintain balances in accounts at the Federal Reserve Bank to satisfy reserve requirements, thereby freeing up liquidity in the banking system to support lending.
+Added: Therefore, at December 31, 2021, and 2020, there were no reserve requirements with the Federal Reserve Bank.
Securities are classified at the time of purchase, based on management’s intentions and ability, as securities held to maturity or securities available-for-sale.
1 unchanged sentence
Unrealized holding gains and losses for available-for-sale debt securities are reported as a separate component of stockholders’ equity, net of tax, until realized.
−Removed: Equity securities are measured at fair value with the change in fair value recognized in Net Gain on Securities of the noninterest income category in the Consolidated Statement of Operations.
+Added: Equity securities are measured at fair value with the change in fair value recognized in Net Gain on Securities within the noninterest income category in the Consolidated Statements of Income (Loss).
Realized securities gains and losses, if any, are computed using the specific identification method.
7 unchanged sentences
Common stock of the Federal Home Loan Bank (“FHLB”) and of Atlantic Community Bankers’ Bank (“ACBB”) represent ownership in organizations that are wholly owned by other financial institutions.
−Removed: These restricted equity securities are accounted for based on industry guidance in ASC Sub-Topic 325-20, which requires the investment to be carried at cost and evaluated for impairment based on the ultimate recoverability of the par value.
+Added: These restricted equity securities are accounted for based on industry guidance in ASC Sub-Topic 325-20, which requires the investment to be carried at cost and
+Added: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
+Added: evaluated for impairment based on the ultimate recoverability of the par value.
Included in accrued interest and other assets are FHLB stock of $ 3.3 million and $ 3.9 million at December 31, 2021 and 2020, respectively, and ACBB stock of $ 85,000 at December 31, 2021 and 2020.
8 unchanged sentences
Construction loans typically consist of loans to build commercial buildings and acquire and develop residential real estate.
−Removed: The commercial and
−Removed: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
−Removed: industrial segment consists of loans to finance the activities of commercial customers.
+Added: The commercial and industrial segment consists of loans to finance the activities of commercial customers as well as Payroll Protection Program ("PPP") loans.
The consumer segment consists primarily of indirect auto loans as well as personal installment loans and personal or overdraft lines of credit.
+Added: Other loan primarily consist of municipal loans to local governments.
Residential mortgage loans are typically longer-term loans and, therefore, generally present greater interest rate risk than the consumer and commercial loans.
20 unchanged sentences
Loans classified as doubtful have all the weaknesses inherent in loans classified as substandard with the added characteristic that collection or liquidation in full, on the basis of current conditions and facts, is highly improbable.
−Removed: Loans classified as loss are considered uncollectable and of such little value that continuance as an asset is not warranted.
+Added: Loans classified as loss are considered uncollectible and of such little value that continuance as an asset is not warranted.
In the normal course of business, the Company modifies loan terms for various reasons.
2 unchanged sentences
TDRs typically are the result of loss mitigation activities whereby concessions are granted to minimize loss and avoid foreclosure or repossession of collateral.
−Removed: The Company evaluates the probability that the borrower will be in payment default on any of its debt in the foreseeable future without modification.
+Added: The Company evaluates the
+Added: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
+Added: probability that the borrower will be in payment default on any of its debt in the foreseeable future without modification.
To make this determination a credit review is performed to assess the ability of the borrower to meet their obligations.
8 unchanged sentences
A loan may be removed from nonaccrual TDR status if it has performed according to its modified terms for at least six consecutive months.
−Removed: Section 4013 of the CARES Act and regulatory guidance promulgated by federal banking regulators provide temporary relief from accounting and financial reporting requirements for TDRs regarding certain short-term loan modifications related to COVID-19.
−Removed: Specifically, the CARES Act provides that the Bank may elect to suspend the requirements under GAAP for
−Removed: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
−Removed: certain loan modifications that would otherwise be categorized as a TDR and suspend any determination that such loan modifications would be considered a TDR, including the related impairment for accounting purposes.
+Added: Section 4013 of the Coronavirus Aid, Relief, and Economic Security Act ("CARES Act") and regulatory guidance promulgated by federal banking regulators provide temporary relief from accounting and financial reporting requirements for TDRs regarding certain short-term loan modifications related to COVID-19.
+Added: Specifically, the CARES Act provides that the Bank may elect to suspend the requirements under GAAP for certain loan modifications that would otherwise be categorized as a TDR and suspend any determination that such loan modifications would be considered a TDR, including the related impairment for accounting purposes.
Any modification involving a loan that was not more than 30 days past due as of December 31, 2019 and that occurs beginning on March 1, 2020 and ends on the earlier of January 1, 2022 (as extended by the Consolidated Appropriations Act, 2021) or the date that is 60 days after the termination date of the national emergency related to the COVID-19 outbreak qualify for this exception, including a forbearance arrangement, interest rate modification, repayment plan or any other similar arrangement that defers or delays the payment of principal or interest.
4 unchanged sentences
In its evaluation of whether a payment deferral qualifies as short-term under the interagency statement, an entity should assess multiple payment deferrals collectively (i.e., the cumulative deferrals cannot exceed six months).
−Removed: The Bank offered forbearance options for borrowers impacted by COVID-19 that provide a short-term delay in payment by primarily allowing:
+Added: The Bank offered forbearance options for borrowers impacted by COVID-19 that provided a short-term delay in payment by primarily allowing:
(a) deferral of three to six months of payments;
or (b) for consumer loans not secured by a real estate mortgage, three months of interest-only payments that also extends the maturity date of the loan by three months .
−Removed: During the forbearance period, the borrower is not considered delinquent for credit bureau reporting purposes.
−Removed: The Company has elected the practical expedients related to TDRs that are available in the CARES Act and interagency guidance as an entity-wide accounting policy and does not consider any of the forbearance agreements TDRs, delinquent, or nonaccrual.
+Added: During the forbearance period, the borrower was not considered delinquent for credit bureau reporting purposes.
+Added: The Company elected the practical expedients related to TDRs that are available in the CARES Act and interagency guidance as an entity-wide accounting policy and did not consider any of the forbearance agreements TDRs, delinquent, or nonaccrual.
The performance and credit quality of the loan portfolio are also monitored by analyzing the age of the loans receivable as determined by the length of time a recorded payment is past due.
3 unchanged sentences
Management performs a quarterly evaluation of the adequacy of the allowance based on potential losses in the current loan portfolio, which includes an assessment of economic conditions, changes in the nature and volume of the loan portfolio, loan loss experience, volume and severity of past due, classified and nonaccrual loans as well as other loan modifications, quality of the Company’s loan review system, the degree of oversight by the Company’s board of directors, existence and effect of any concentrations of credit and changes in the level of such concentrations, effect of external factors, such as competition and legal and regulatory requirements, and other relevant factors.
−Removed: While management uses the best information available to make such evaluations, future adjustments to the allowance may be necessary if economic conditions differ substantially from the assumptions used in making evaluations.
+Added: While management uses the best information available to make such evaluations, future adjustments to the allowance may be necessary if economic conditions
+Added: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
+Added: differ substantially from the assumptions used in making evaluations.
Additions are made to the allowance through periodic provisions charged to income and recovery of principal and interest on loans previously charged-off.
8 unchanged sentences
Impairment is measured based on the present value of expected future cash flows discounted at a loan’s effective interest rate, or as a practical expedient, the observable market price, or, if the loan is collateral dependent, the fair value of the underlying collateral.
−Removed: When the measurement of an impaired loan is less than the recorded investment in the loan, the impairment is
−Removed: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
−Removed: recorded in a specific valuation allowance.
+Added: When the measurement of an impaired loan is less than the recorded investment in the loan, the impairment is recorded in a specific valuation allowance.
This specific valuation allowance is periodically adjusted for significant changes in the amount or timing of expected future cash flows, observable market price or fair value of the collateral.
6 unchanged sentences
The general allowance component covers pools of homogeneous loans by loan class.
−Removed: Management determines historical loss experience for each segment of loans using the two-year rolling average of the net charge-off data within each segment.
+Added: Management determines historical loss experience for each segment of loans using the five-year rolling average of the net charge-off data within each segment.
Qualitative and environmental factors are also considered that are likely to cause estimated credit losses associated with the Bank’s existing portfolio to differ from historical loss experience, and include levels and trends in delinquency and impaired loans;
14 unchanged sentences
Charge-offs of the principal amount on acquired loans would be first applied to the nonaccretable discount portion of the fair value adjustment.
−Removed: The Company grants commercial, residential, and other consumer loans to customers throughout southwestern Pennsylvania in Greene, Washington, Allegheny, Fayette and Westmoreland Counties;
−Removed: West Virginia in Brooke, Marshall, Ohio, Upshur and Wetzel Counties;
−Removed: and Belmont County in Ohio.
+Added: The Company grants commercial, residential, and other consumer loans to customers at its branch locations throughout southwestern Pennsylvania in Greene, Washington, Allegheny, Fayette and Westmoreland Counties and in the panhandle of West Virginia in Marshall and Ohio Counties.
Although the Company had a diversified loan portfolio at December 31, 2021 and 2020, a substantial portion of its debtors’ ability to honor their contracts is determined by the economic environment of these counties within the tri-state region footprint.
+Added: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Premises and Equipment
13 unchanged sentences
Direct costs incurred in the foreclosure process and subsequent holding costs incurred on such properties are recorded as expenses of current operations.
−Removed: Real estate owned was $ 208,000 and $ 233,000 at
−Removed: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
−Removed: December 31, 2020 and 2019, respectively.
−Removed: Of these amounts, $ 0 and $ 41,000 represent residential loans at December 31, 2020 and 2019, respectively.
−Removed: Residential loans in process of foreclosure were $ 806,000 and $ 1.1 million at December 31, 2020 and 2019, respectively.
+Added: Real estate owned was $ 36,000 and $ 208,000 at December 31, 2021 and 2020, respectively.
The Company accounts for income taxes in accordance with income tax accounting guidance in ASC Topic 740, Income Taxes .
21 unchanged sentences
An entity also has the option to bypass the qualitative assessment for any reporting unit and proceed directly to the first step of impairment testing.
+Added: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
The Company recorded goodwill impairment of $ 18.7 million for the year ended December 31, 2020 and did no t record any goodwill impairment for the year ended December 31, 2021.
14 unchanged sentences
MSRs are recognized when commitments are made to fund a loan to be sold and are recorded by allocating total costs incurred between the loan and servicing rights based on their relative fair values.
−Removed: MSRs are amortized
−Removed: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
−Removed: in proportion to sold mortgages that are serviced and are included in Accrued Interest Receivable and Other Assets on the accompanying Consolidated Statement of Financial Condition.
+Added: MSRs are amortized in proportion to sold mortgages that are serviced and are included in Accrued Interest Receivable and Other Assets on the accompanying Consolidated Statements of Financial Condition.
Servicing fee income is recorded for fees earned for servicing loans.
The fees are based on contractual percentage of the outstanding principal or a fixed amount per loan and are recorded as income when earned.
−Removed: The amortization of MSRs is netted against servicing fee income in Other (Loss) Income of the noninterest income category in the Consolidated Statement of Operations.
+Added: The amortization of MSRs is netted against servicing fee income in Other Income (Loss) within the noninterest income category in the Consolidated Statements of Income (Loss).
MSRs are evaluated for impairment based on the estimated fair value of the MSRs.
5 unchanged sentences
At the date of subsequent reissue, the treasury stock account is reduced by the cost of such stock on the average cost basis, with any excess proceeds being credited to capital surplus.
−Removed: Comprehensive (Loss) Income
−Removed: Comprehensive (loss) income consists of net (loss) income and other comprehensive income.
+Added: Comprehensive Income (Loss)
+Added: Comprehensive income (loss) consists of net income (loss) and other comprehensive income.
Other comprehensive income is comprised of unrealized holding gains on available-for-sale debt securities, net of tax.
6 unchanged sentences
In 2021, the Company’s stockholders approved the 2021 Equity Incentive Plan (the “2021 Plan”).
−Removed: The purpose of the Plan is to promote the long-term financial success of the Company by providing a means to attract, retain and reward individuals who contribute to such success and to further align their interests with those of the Company’s stockholders through the ownership of additional common stock of the Company.
−Removed: The effective date of the Plan is May 20, 2015, which was the date the Plan satisfied the applicable stockholder approval requirement.
−Removed: The Plan shall remain in effect as long as any awards are outstanding, provided, however, that no awards may be granted under the Plan after the day immediately prior to the ten-year anniversary of the effective date of May 20, 2015.
−Removed: All of the Company’s directors and employees are eligible to participate in the Plan.
−Removed: The Plan authorizes the granting of options to purchase shares of the Company’s stock, which may be non-qualified stock options or incentive stock options, restricted stock awards or restricted stock units.
−Removed: The Plan reserved an aggregate number of 407,146 shares, of which two-thirds of the shares ( 271,431 ) may be issued as stock options and one-third of the shares ( 135,715 ) may be issued as restricted stock awards or units.
−Removed: Restricted stock awards or units can be issued above the one-third threshold provided that the number of shares reserved for stock options is reduced by three shares for each restricted stock award or unit granted above the one-third threshold.
+Added: The purpose of the 2021 Plan is to provide officers, employees and directors of the Company and the Bank with additional incentives to promote the growth and performance of the Company and to further align their interests with those of the Company’s stockholders through the ownership of additional common stock of the Company.
+Added: In addition, the 2021 Plan provides the Company with flexibility to continue to attract and retain highly qualified officers and directors by offering a competitive compensation program that is linked to the performance of the Company's common stock.
+Added: The effective date of the 2021 Plan was May 19, 2021, which was the date the 2021 Plan satisfied the applicable stockholder approval requirement.
+Added: The 2021 Plan will remain in effect as long as any awards under it are outstanding;
+Added: however, no awards may be granted under the 2021 Plan on or after the day immediately prior to the ten-year anniversary of the effective date of the 2021 Plan.
+Added: Awards may be granted under the 2021 Plan as incentive and non-statutory stock options, restricted stock awards, restricted stock units or any combination thereof, The maximum number of shares of Company common stock that may be delivered to
+Added: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
+Added: participants under the 2021 Plan is equal to 500,000 shares of Company common stock (the “Share Limit”).
+Added: Shares of Company common stock subject to the Share Limit may be issued pursuant to grants of stock options, restricted stock awards or restricted stock units, provided, however that the Share Limit is reduced, on a one-for-one basis, for each share of common stock subject to a stock option grant, and on a two and one-half-for-one basis for each share of common stock issued pursuant to restricted stock awards or restricted stock unit awards.
+Added: If any award granted under the 2021 Plan expires, terminates, is canceled or is forfeited without being settled or exercised or is settled without the issuance of shares of common stock, shares of Company common stock subject to such award will be made available for future grant under the 2021 Plan.
+Added: If any shares are surrendered or tendered to pay the exercise price of a stock option, such shares will not again be available for grant under the 2021 Plan.
+Added: In addition, shares of common stock withheld in payment for purposes of satisfying tax withholding obligations with respect to an award do not become available for re-issuance under the 2021 Plan.
+Added: Employees and directors of the Company or its subsidiaries are eligible to receive awards under the 2021 Equity Incentive Plan, except that non-employees may not be granted incentive stock options.
+Added: In 2015, the Company’s stockholders approved the 2015 Equity Incentive Plan (the “2015 Plan”), which has similar characteristics to the 2021 Plan.
+Added: The effective date of the 2015 Plan was May 20, 2015.
+Added: The 2015 Plan shall remain in effect as long as any awards are outstanding, but as a result of the approval of the 2021 Plan, no more awards can be granted under the 2015 Plan.
+Added: The 2015 Plan reserved an aggregate number of shares, of which two-thirds of the shares ( 271,431 ) could be issued as stock options and one-third of the shares ( 135,715 ) could be be issued as restricted stock awards or units.
ASC Topic 718, Compensation – Stock Compensation, requires recognizing the compensation cost in the financial statements for stock-based payment transactions.
5 unchanged sentences
Unrecognized compensation expense is recognized ratably over the remaining service period, generally defined as the vesting period, for all nonvested restricted stock awards and stock options.
−Removed: Restricted stock awards and stock options are typically granted with a five years vesting period at a vesting rate of 20 % per year.
+Added: Restricted stock awards and stock options are typically granted with a five year vesting period at a vesting rate of 20 % per year.
The contractual life of stock options is typically 10 years from the date of grant.
−Removed: Cash Flow Information
−Removed: The Company has defined cash equivalents as those amounts due from depository institutions, interest-bearing deposits with other banks with maturities of less than 90 days, and federal funds sold.
−Removed: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Advertising Costs
Advertising costs are expensed as incurred.
+Added: Impairment of Long-Lived Assets
+Added: The Company routinely performs assessments of the recoverability of long-lived assets when events or changes in circumstances indicate that their carrying values may not be recoverable and are in excess of their fair value, less estimated costs to sell.
+Added: If estimated recoverable amounts are lower than carrying values, assets are considered impaired and reduced to fair value with the recognized impairment charges recorded in noninterest expense in the Consolidated Statements of (Loss) Income.
+Added: Long-lived assets are tested for impairment individually or as part of an asset group.
+Added: An asset group is the unit of accounting for long-lived assets to be held and used, which represents the lowest level for which identifiable cash flows are largely independent of the cash flows of other groups of assets and liabilities.
+Added: The Company follows ASC 360, Property, Plant and Equipment, which requires three steps to identify, recognize and measure the impairment of a long-lived asset (asset group) to be held and used:
+Added: Step 1 – Consider whether Indicators of Impairment are Present.
+Added: The following are examples of such events or changes in circumstances.
+Added: • A significant decrease in the market price of a long-lived asset (asset group).
+Added: • A significant adverse change in the extent or manner in which a long-lived asset (asset group) is being used or in its physical condition.
+Added: • A significant adverse change in legal factors or in the business climate that could affect the value of a long-lived asset (asset group), including an adverse action or assessment by a regulator.
+Added: • An accumulation of costs significantly in excess of the amount originally expected for the acquisition or construction of a long-lived asset (asset group).
+Added: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
+Added: • A current-period operating or cash flow loss combined with a history of operating or cash flow losses or a projection or forecast that demonstrates continuing losses associated with the use of a long-lived asset (asset group).
+Added: • A current expectation that, more likely than not, a long-lived asset (asset group) will be sold or otherwise disposed of significantly before the end of its previously estimated useful life.
+Added: The term more likely than not refers to a level of likelihood that is more than 50 percent.
+Added: Step 2—Test for Recoverability
+Added: If indicators of impairment are present, the Company performs a recoverability test comparing the sum of the estimated undiscounted cash flows attributable to the long-lived asset or asset group in question to the carrying amount of the long-lived asset or asset group.
+Added: Step 3—Measurement of an Impairment Loss
+Added: If the undiscounted cash flows used in the recoverability test are less than the carrying amount of the long-lived asset (asset group), the Company estimates the fair value of the long-lived asset or asset group and recognizes an impairment loss when the carrying amount of the long-lived asset or asset group exceeds the estimated fair value.
+Added: An impairment loss is allocated to the long-lived assets of the group on a pro rata basis using the relative carrying amounts of those assets, except that the loss allocated to an individual long-lived asset of the group must not reduce the carrying amount of that asset below its fair value whenever the fair value is determinable without undue cost and effort.
+Added: ASC 360 prohibits the subsequent reversal of an impairment loss for an asset held and used.
Reclassifications
−Removed: Certain comparative amounts for prior periods have been reclassified to conform to the current year presentation.
+Added: Certain comparative amounts for prior periods may have been reclassified to conform to the current year presentation.
Such reclassifications did not affect net income or stockholders’ equity.
Recent Accounting Standards
+Added: In August 2021, the Financial Accounting Standard Board (“FASB”) issued Accounting Standards Update ("ASU") 2021-06, Presentation of Financial Statements (Topic 205), Financial Services—Depository and Lending (Topic 942), and Financial Services—Investment Companies (Topic 946):
+Added: Amendments to SEC Paragraphs Pursuant to SEC Final Rule Releases No.
+Added: 33-10786, Amendments to Financial Disclosures about Acquired and Disposed Businesses, and No.
+Added: 33-10835, Update of Statistical Disclosures for Bank and Savings and Loan Registrants.
+Added: This ASU incorporates recent SEC rule changes into the FASB Codification, including SEC Final Rule Releases No.
+Added: 33-10786, Amendments to Financial Disclosures about Acquired and Disposed Businesses, and No.
+Added: 33-10835, Update of Statistical Disclosures for Bank and Savings and Loan Registrants.
+Added: The SEC rule changes update and expand the statistical disclosures that bank and savings and loan registrants provide to investors, in light of changes in this sector over the past 30 years.
+Added: The rules also eliminate certain disclosure items that are duplicative of other SEC rules and requirements of U.S.
+Added: The rules replace Industry Guide 3, Statistical Disclosure by Bank Holding Companies, with updated disclosure requirements in a new subpart of Regulation S-K.
+Added: The rules are intended to help ensure that investors have access to more meaningful, relevant information to facilitate their investment and voting decisions.
+Added: The amendments are effective prospectively for fiscal years beginning after December 15, 2021, and interim periods within fiscal years beginning after December 15, 2022.
+Added: The adoption of this ASU did not have a material impact on the Company's consolidated statements of financial condition or results of operation.
In March 2020, the Financial Accounting Standard Board (“FASB”) issued ASU 2020-04, Reference Rate Reform (Topic 848):
7 unchanged sentences
ASU 2020-04 is effective for all entities as of March 12, 2020 through December 31, 2022.
−Removed: While the LIBOR reform may require extensive changes to the contracts that govern LIBOR based products, as well as our systems and processes, we cannot yet determine whether the Company will be able to use the optional expedient for the changes to contract terms that may be required by LIBOR reform and therefore, the Company cannot yet determine the magnitude of the impact or the overall impact of the new guidance on the Company’s consolidated financial condition or results of operation.
+Added: The Company has formed a cross-functional team to lead the transition from LIBOR to a planned adoption of an alternate index.
+Added: The Company is in the process of implementing fallback language for loans or working with lead participating banks and expects to adopt the LIBOR transition relief allowed by the optional expedient under this standard.
+Added: As of December 31, 2021, the Company has identified approximately $ 160.0 million in
+Added: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
+Added: outstanding loan balances and a $ 5.0 million corporate debt security tied to the LIBOR reference rate.
+Added: The Company has not yet made any contract modifications.
+Added: The Company is currently evaluating the potential impact of this guidance on its consolidated statements of financial statements and results of operations.
In December 2019, FASB issued ASU 2019-12, Income taxes (Topic 740);
12 unchanged sentences
For public business entities, the amendments in ASU 2019-12 are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020.
−Removed: The Company is currently evaluating the impact of adopting this ASU on its consolidated financial statements.
−Removed: In August 2018, the FASB issued ASU 2018-15 , Intangibles – Goodwill and Other – Internal-Use Software (Subtopic 350-40) .
−Removed: ASU 2018-15 was issued to help entities evaluate the accounting for fees paid by a customer in a cloud computing arrangement (hosting arrangement) by providing guidance for determining when the arrangement includes a software license.
−Removed: The amendments align the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software (and hosting arrangements that include an internal-use software license).
−Removed: The accounting for the service element of a hosting arrangement that is a service contract is not affected by the amendments.
−Removed: This guidance became effective for the Company beginning in the first quarter 2020 and the adoption of this ASU did not have a material impact on the Company's consolidated statement of financial condition or results of operations.
−Removed: In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820) .
−Removed: ASU 2018-13 modifies disclosure requirements on fair value measurements.
−Removed: This ASU removes requirements to disclose the amount of and reasons for transfers between Level 1 and Level 2 of the fair value hierarchy, the policy for timing of transfers between levels and the valuation processes for Level 3 fair value measurements.
−Removed: ASU 2018-13 clarifies that disclosure regarding measurement uncertainty is intended to communicate information about the uncertainty in measurement as of the reporting date.
−Removed: ASU 2018-13 adds certain disclosure requirements, including disclosure of changes in unrealized gains and losses for the period included in other comprehensive income for recurring Level 3 fair value measurements held at the end of the reporting period and the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements.
−Removed: The amendments in this ASU are effective for the Company beginning in the first quarter 2020.
−Removed: The amendments on changes in unrealized gains and
−Removed: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
−Removed: losses, the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements and the narrative description of measurement uncertainty should be applied prospectively, while all other amendments should be applied retrospectively for all periods presented.
−Removed: The adoption of this ASU did not have a material impact on the Company's consolidated statement of financial condition or results of operations.
+Added: The adoption of this ASU did not have a material impact on the Company's consolidated statements of financial condition or results of operation.
In September 2016, the FASB issued ASU 2016-13, Financial Instruments – Credit Losses (Topic 326):
10 unchanged sentences
Early adoption will continue to be permitted.
−Removed: The Company is evaluating the impact of this ASU and expects to recognize a one-time adjustment to the allowance for loan losses upon adoption, but we cannot yet determine the magnitude of the one-time adjustment or the overall impact of the new guidance on the Company’s consolidated financial condition or results of operation.
−Removed: NOTE 2— (LOSS) EARNINGS PER SHARE
+Added: In preparation for the implementation of this ASU, the Company has formed a cross-functional team, contracted with a third-party software provider, and is consulting with a third-party professional advisory service to assist in the model development.
+Added: The Company plans to assess the overall impact by running the existing and new allowance models in parallel prior to the period of implementation.
+Added: The Company expects to recognize a one-time adjustment to the allowance for loan losses upon adoption, but cannot yet determine the magnitude of the one-time adjustment or the overall impact of the new guidance on the Company’s consolidated financial condition or results of operation.
+Added: NOTE 2— EARNINGS (LOSS) PER SHARE
There are no convertible securities, which would affect the numerator in calculating basic and diluted earnings per share;
−Removed: therefore, net (loss) income as presented on the Consolidated Statement of Operations is used as the numerator.
+Added: therefore, net income (loss) as presented on the Consolidated Statements of Income (Loss) is used as the numerator.
The following table sets forth the composition of the weighted-average common shares (denominator) used in the basic and diluted earnings per share computation.
1 unchanged sentence
(Dollars in Thousands, Except Share and Per Share Data)
−Removed: Net (Loss) Income $ ( 10,640 ) $ 14,327
+Added: Net Income (Loss) $ 11,570 $ ( 10,640 )
Weighted-Average Basic Common Shares Outstanding 5,382,441 5,406,290
1 unchanged sentence
Weighted-Average Diluted Common Shares and Common Stock Equivalents Outstanding 5,392,729 5,406,290
−Removed: (Loss) Earnings per share:
+Added: Earnings (Loss) Per Share:
Basic $ 2.15 $ ( 1.97 )
Diluted 2.15 ( 1.97 )
+Added: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
The dilutive effect on weighted average diluted common shares outstanding is the result of outstanding stock options and nonvested restricted stock.
−Removed: The following table presents for the periods indicated (a) options to purchase shares of common stock that were outstanding but not included in the computation of earnings per share because the options' exercise price was greater than the average market price of the common shares for the period, and (b) shares of restricted stock awards that were not included in the computation of diluted earnings per share because the hypothetical repurchase of shares under the treasury stock method exceeded the weighted average nonvested restricted awards, therefore the effects would be anti-dilutive.
+Added: The following table presents as of the periods indicated (a) options to purchase shares of common stock that were outstanding but not included in the computation of earnings per share because the options' exercise price was greater than the average market price of the common shares for the period, and (b) shares of restricted stock awards that were not included in the computation of diluted earnings per share because the hypothetical repurchase of shares under the treasury stock method exceeded the weighted average nonvested restricted awards, therefore the effects would be anti-dilutive.
Year Ended December 31, 2021 2020
4 unchanged sentences
Therefore, if there is a net loss, diluted loss per share is the same as basic loss per share.
−Removed: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 3— SECURITIES
The amortized cost and fair value of securities available-for-sale as of the dates indicated are as follows:
−Removed: December 31, Amortized
+Added: December 31, Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair
(Dollars in Thousands)
3 unchanged sentences
Mortgage-Backed Securities - Government-Sponsored Enterprises 55,373 1,468 ( 282 ) 56,559
+Added: Collateralized Mortgage Obligations - Government Sponsored Enterprises 88,493 164 ( 2,074 ) 86,583
+Added: Corporate Debt 7,481 — ( 31 ) 7,450
Total Available-for-Sale Debt Securities $ 223,290 $ 2,638 $ ( 3,820 ) 222,108
3 unchanged sentences
Total Securities $ 224,974
−Removed: December 31, Amortized
+Added: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
+Added: December 31, Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair
(Dollars in Thousands)
18 unchanged sentences
Government Agencies 5 $ 17,729 $ ( 269 ) 7 $ 31,830 $ ( 1,164 ) 12 $ 49,559 $ ( 1,433 )
+Added: Mortgage-Backed Securities - Government Sponsored Enterprises 8 28,772 ( 282 ) — — — 8 28,772 ( 282 )
+Added: Collateralized Mortgage Obligations - Government Sponsored Enterprises 10 77,560 ( 2,074 ) — — — 10 77,560 ( 2,074 )
+Added: Corporate Debt 2 7,450 ( 31 ) — — — 2 7,450 ( 31 )
Total 25 $ 131,511 $ ( 2,656 ) 7 $ 31,830 $ ( 1,164 ) 32 $ 163,341 $ ( 3,820 )
−Removed: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Less than 12 months 12 Months or Greater Total
7 unchanged sentences
Government Agencies 7 $ 32,399 $ ( 595 ) — $ — $ — 7 $ 32,399 $ ( 595 )
−Removed: Obligations of States and Political Subdivisions — — — 1 509 ( 2 ) 1 509 ( 2 )
−Removed: Mortgage-Backed Securities - Government Sponsored Enterprises 7 20,003 ( 104 ) 1 1,711 ( 3 ) 8 21,714 ( 107 )
Total 7 $ 32,399 $ ( 595 ) — $ — $ — 7 $ 32,399 $ ( 595 )
4 unchanged sentences
The scheduled maturities of securities available-for-sale are summarized as follows.
+Added: Actual maturities will differ from contractual maturities because borrowers may have the right to call or prepay debt obligations with or without prepayment
+Added: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
+Added: Mortgage-backed securities and collateralized mortgage obligations are classified in the table below based on their contractual maturity date;
+Added: however, regular principal payments and prepayments of principal are received on a monthly basis.
December 31, Amortized
(Dollars in Thousands)
+Added: Due in One Year or Less $ 2,580 $ 2,604
Due after One Year through Five Years 4,471 4,457
2 unchanged sentences
Total $ 223,290 $ 222,108
−Removed: The following table presents gross gain and loss of sales of available-for-sale securities for the periods indicated.
+Added: The following table presents the gross realized gain and loss on sales of debt securities, as well as gain and loss on equity securities from both sales and market adjustments for the periods indicated.
+Added: All gains and losses presented in the table below are reported in Net Gain on Securities on the Consolidated Statements of Income (Loss).
Year Ended December 31, 2021 2020
3 unchanged sentences
Gross Realized Loss — —
−Removed: Net Gain (Loss) on Debt Securities $ 489 $ ( 50 )
+Added: Net Gain on Debt Securities $ 225 $ 489
Equity Securities
−Removed: Net Unrealized (Loss) Gain Recognized on Securities Held $ ( 267 ) $ 190
+Added: Net Unrealized Gain (Loss) Recognized on Securities Held $ 295 $ ( 267 )
Net Realized Gain Recognized on Securities Sold 6 11
−Removed: Net (Loss) Gain on Equity Securities ( 256 ) 190
+Added: Net Gain (Loss) on Equity Securities $ 301 $ ( 256 )
Net Gain on Securities $ 526 $ 233
−Removed: In 2020, the gross realized gain on the sale of debt securities of $ 489,000 was by design to recognize gains on higher-interest mortgage-backed securities that were paying down quicker than expected.
−Removed: In 2019, the realized loss on the sale of debt securities was recognized to mitigate investment-credit risk and to reinvest in higher yielding, longer-term investments as well as to mitigate call risk in a declining interest rate environment.
+Added: In 2021, the gross realized gain on the sale of debt securities of $ 225,000 was to recognize gains on higher-interest mortgage-backed securities that were paying down quicker than expected.
+Added: In 2020, the realized gain on the sale of debt securities was recognized to mitigate investment-credit risk and to reinvest in higher yielding, longer-term investments as well as to mitigate call risk in a declining interest rate environment.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
21 unchanged sentences
Previously the deferral period could end after six months.
−Removed: The Bank received a processing fee from the SBA ranging from 1 % to 5 % depending on the size of the loan, which was offset by a 0.75 % third-party servicing agent fee.
−Removed: In 2020, the Bank originated 639 PPP loans totaling $ 71.0 million.
−Removed: Among the largest sectors impacted were $ 15.6 million in loans for health care and social assistance, $ 12.6 million for construction and specialty-trade contractors, $ 6.1 million for professional and technical services, $ 6.1 million for retail trade, $ 5.1 million for wholesale trade, $ 4.6 million for manufacturing and $ 3.4 million for restaurant and food services.
−Removed: Net deferred origination fees were $ 2.2 million, of which $ 1.1 million was recognized during year ended December 31, 2020.
−Removed: Processing of PPP loan forgiveness began in the fourth quarter of 2020 and at December 31, 2020, PPP loans totaled $ 55.1 million.
−Removed: All PPP loans are classified as commercial and industrial loans.
−Removed: No allowance for loan loss was allocated to the PPP loan portfolio due to the Bank complying with the lender obligations that ensure SBA guarantee.
−Removed: The SBA reopened the PPP the week of January 11, 2021 and began accepting applications for both First Draw and Second Draw PPP Loans.
−Removed: Second Draw PPP Loans are available for certain eligible borrowers that previously received a PPP loan.
+Added: In 2020, the Bank received a processing fee from the SBA ranging from 1 % to 5 % depending on the size of the loan, which was offset by a 0.75 % third-party servicing agent fee.
+Added: The SBA reopened the PPP in January 2021 and began accepting applications for both First Draw and Second Draw PPP Loans.
+Added: Second Draw PPP Loans were available for certain eligible borrowers that previously received a PPP loan.
A Second Draw PPP Loan has the same general terms as the First Draw PPP Loan.
−Removed: A borrower is generally eligible for a Second Draw PPP Loan if the borrower previously received a First Draw PPP Loan and will or has used the full amount only for authorized uses, has no more than 300 employees, and can demonstrate at least a 25% reduction in gross receipts between comparable quarters in 2019 and 2020.
−Removed: For most borrowers, the maximum amount of a Second Draw PPP Loan is 2.5x average monthly 2019 or 2020 payroll costs up to $2.0 million.
−Removed: Loan payments will be deferred for borrowers who apply for loan forgiveness until the SBA remits the borrower's loan forgiveness amount to the lender.
+Added: A borrower was generally eligible for a Second Draw PPP Loan if the borrower previously received a First Draw PPP Loan and will or had used the full amount only for authorized uses, had no more than 300 employees, and demonstrated at least a 25% reduction in gross receipts between comparable quarters in 2019 and 2020.
+Added: For most borrowers, the maximum amount of a Second Draw PPP Loan was 2.5x average monthly 2019 or 2020 payroll costs up to $2.0 million.
+Added: Loan payments are deferred for borrowers who apply for loan forgiveness until the SBA remits the borrower's loan forgiveness amount to the lender.
If a borrower does not apply for loan forgiveness, payments are deferred 10 months after the end of the covered period for the borrower’s loan forgiveness (either 8 weeks or 24 weeks).
−Removed: For PPP loans made on or after December 27, 2020, the lender’s processing fee from the SBA is the lesser of 50% or $2,500 for loans up to $50,000, 5% for loans greater than $50,000 and up to $350,000, 3% for loans greater than $350,000 and less than $2.0 million and 1% for loans of at least $2.0 million.
−Removed: As of February 28, 2021, the Bank received 181 applications totaling $ 26.7 million with total estimated processing fees of $ 1.2 million.
+Added: For PPP loans made in 2021, the processing fee from the SBA was the lesser of 50% or $2,500 for loans up to $50,000, 5% for loans greater than $50,000 and up to $350,000, 3% for loans greater than $350,000 and less than $2.0 million and 1% for loans of at least $2.0 million.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
−Removed: Total unamortized net deferred loan fees were $ 2.0 million and $ 906,618 at December 31, 2020 and 2019, respectively.
−Removed: $ 1.1 million of net deferred PPP loan origination fees were unearned as of December 31, 2020.
+Added: The following table presents PPP loan activity segregated by loans originated in 2020 and 2021.
+Added: 2020 2021 Total
+Added: Number of Loans Principal Balance Net Deferred Origination Fees Number of Loans Principal Balance Net Deferred Origination Fees Number of Loans Principal Balance Net Deferred Origination Fees
+Added: (Dollars in Thousands)
+Added: PPP Loans Originated 639 $ 71,057 $ 2,202 218 $ 34,617 $ 1,268 857 $ 105,674 $ 3,470
+Added: PPP Loan Forgiveness Through December 31, 2021
+Added: 605 69,374 2,152 97 11,027 478 702 80,401 2,630
+Added: Principal Payments or Net Deferred Origination Fees Recognized on Unforgiven PPP Loans — 70 33 — 2 129 — 72 162
+Added: PPP Loans Remaining at December 31, 2021
+Added: 34 $ 1,613 $ 17 121 $ 23,588 $ 661 155 $ 25,201 $ 678
+Added: PPP Loans Remaining, Net of Deferred Fees at December 31, 2021
+Added: $ 1,596 $ 22,927 $ 24,523
+Added: Net deferred origination fees on PPP loans totaled $ 3.5 million, of which $ 1.7 million and $ 1.1 million was recognized during the years ended December 31, 2021 and 2020.
+Added: All PPP loans are classified as commercial and industrial loans.
+Added: No allowance for loan loss was allocated to the PPP loan portfolio due to the Bank complying with the lender obligations that ensure SBA guarantee.
+Added: Total unamortized net deferred loan fees were $ 1.9 million and $ 2.0 million at December 31, 2021 and 2020, respectively.
+Added: $ 678,000 and $ 1.1 million of net deferred PPP loan origination fees were unearned as of December 31, 2021 and 2020.
The following table presents loans summarized by the aggregate pass and the criticized categories of special mention, substandard and doubtful within the internal risk rating system as of dates indicated.
10 unchanged sentences
Total Loans $ 949,636 $ 55,579 $ 15,069 $ 512 $ 1,020,796
+Added: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
December 31, Pass Special
−Removed: Mention Substandard Doubtful Total
+Added: Substandard Doubtful Total
(Dollars in Thousands)
6 unchanged sentences
Total Loans $ 970,587 $ 46,515 $ 27,042 $ 609 $ 1,044,753
−Removed: The increase of $ 21.9 million in the special mention loan category and $ 19.7 million in the substandard category as of December 31, 2020 compared to December 31, 2019 was mainly from the downgrade of the hospitality portfolio due to the economic conditions in that industry caused by the COVID-19 pandemic.
−Removed: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
+Added: The decrease of $ 12.0 million in the substandard category as of December 31, 2021 compared to December 31, 2020 was mainly from the sale or full payoff in the current year of two of the Bank’s nonperforming commercial real estate loans that were secured by hotels totaling $ 6.7 million and a $ 1.9 million commercial and industrial loan.
The following tables present the classes of the loan portfolio summarized by the aging categories of performing loans and nonaccrual loans as of the dates indicated:
27 unchanged sentences
Total Loans $ 1,029,036 $ 3,704 $ 1,116 $ 8 $ 4,828 $ 10,889 $ 1,044,753
−Removed: The increase in nonaccrual commercial real estate loans at December 31, 2020 compared to December 31, 2019 is primarily related to two hospitality loans with a total principal balance of $ 6.9 million that were impacted by the pandemic due to insufficient cash flows and occupancy rates.
−Removed: The increase in nonaccrual commercial and industrial loans is primarily related to a $ 1.3 million relationship.
−Removed: Total unrecorded interest income related to nonaccrual loans was $ 233,000 and $ 74,000 for the year ended December 31, 2020 and 2019, respectively.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
+Added: The decrease in nonaccrual commercial real estate loans at December 31, 2021 compared to December 31, 2020 is primarily related to the sale and full payoff in the current year of two of the Bank’s nonperforming commercial real estate loans that were secured by hotels totaling $ 6.7 million.
+Added: Total unrecorded interest income related to nonaccrual loans was $ 122,000 and $ 233,000 for the year ended December 31, 2021 and 2020, respectively.
A summary of the loans considered impaired and evaluated for impairment as of the dates indicated are as follows:
11 unchanged sentences
With A Related Allowance Recorded:
−Removed: Residential $ — $ — $ — $ — $ —
Commercial $ 266 $ 195 $ 266 $ 421 $ 19
Construction 2,013 104 2,013 169 7
−Removed: Commercial and Industrial 2,069 356 2,069 2,114 57
Total With A Related Allowance Recorded $ 2,279 $ 299 $ 2,279 $ 1,906 $ 55
18 unchanged sentences
With A Related Allowance Recorded:
−Removed: Residential $ — $ — $ — $ — $ —
Commercial $ 1,524 $ 293 $ 1,524 $ 1,585 $ 72
−Removed: Construction — — — — —
Commercial and Industrial 2,069 356 2,069 2,114 57
6 unchanged sentences
Total Impaired Loans $ 44,141 $ 649 $ 45,377 $ 49,775 $ 1,841
−Removed: The increase in commercial real estate loans and construction loans evaluated for impairment at December 31, 2020 compared to December 31, 2019 is primarily due to the Company evaluating the hospitality portfolio for impairment in light of the industry conditions caused by the COVID-19 pandemic.
−Removed: The following table provides details of loans in forbearance at the date indicated.
−Removed: December 31, Number
−Removed: Loans Amount % of Portfolio
−Removed: (Dollars in Thousands)
−Removed: Residential 4 $ 749 0.2 %
−Removed: Commercial 8 19,818 5.3 %
−Removed: Construction 1 1,958 2.7 %
−Removed: Commercial and Industrial 5 1,219 1.0 %
−Removed: Consumer 13 356 0.3 %
−Removed: Other — — — %
−Removed: Total Loans in Forbearance 31 $ 24,100 2.3 %
−Removed: Loans on deferral at December 31, 2020 include the following:
−Removed: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
−Removed: • Hospitality - three commercial real estate loans totaling $ 8.2 million and a $ 2.0 million construction loan.
−Removed: • Office and retail space - two commercial real estate loans totaling $ 8.3 million.
−Removed: • One commercial relationship that rents equipment, supplies and other materials for events comprised three commercial real estate loans totaling $ 3.3 million, and five commercial and industrial loans totaling $ 1.2 million.
−Removed: The majority of the commercial real estate loans, construction loans and commercial and industrial loans in the above table are on deferral for six months with regular payments scheduled to begin in July 2021.
+Added: The recorded investment of loans evaluated for impairment decreased $ 28.5 million at December 31, 2021 compared to December 31, 2020 and was largely related to commercial real estate loans.
+Added: This was primarily the result in the current period of no longer separately evaluating for impairment certain commercial real estate loans secured by hotels that have manageable loan-to-value ratios and exhibited an ability to cash flow during the COVID-19 pandemic.
+Added: At December 31, 2020, there were 31 loans in forbearance totaling $ 24.1 million for borrowers impacted by the COVID-19 pandemic, including $ 19.8 million of commercial real estate loans.
+Added: All loans exited forbearance in 2021 except a $ 1.9 million commercial real estate loan secured by a hotel, which was considered a troubled debt restructuring upon providing an additional forbearance period and modified payment terms.
+Added: The loan was substandard rated at December 31, 2021 and 2020, respectively, and designated as a nonaccrual loan in 2021.
+Added: The recorded investment of residential real estate loans for which formal foreclosure proceedings were in process according to applicable requirements of the local jurisdiction was $ 571,000 and $ 806,000 at December 31, 2021 and 2020, respectively.
The concessions granted for the TDRs in the portfolio primarily consist of, but are not limited to, modification of payment or other terms and extension of maturity date.
Loans classified as TDRs consisted of 15 and 17 loans totaling $ 4.7 million and $ 4.2 million as of December 31, 2021 and 2020, respectively.
−Removed: During the year ended December 31, 2020, two residential real estate loan totaling $ 83,000 and one commercial and industrial loan totaling $ 1,000 modified in TDRs paid off.
−Removed: During the year ended December 31, 2019, one residential real estate loan modified in a TDR totaling $ 851,000 paid off.
+Added: During the year ended December 31, 2021, a $ 3,000 residential real estate loan, a $ 698,000 commercial real estate loan, and an $ 8,000 commercial and industrial loan previously modified in TDRs paid off.
+Added: During the year ended December 31, 2020, two residential real estate loans totaling $ 83,000 and a $ 1,000 commercial and industrial loan previously modified in TDRs paid off.
No TDRs subsequently defaulted during the years ended December 31, 2021 and 2020, respectively.
+Added: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
The following table presents information at the time of modification related to loans modified as TDRs during the periods indicated.
4 unchanged sentences
(Dollars in Thousands)
−Removed: Residential 1 $ 234 $ 234 $ —
Commercial 1 $ 1,958 $ 1,958 $ —
−Removed: Commercial and Industrial 1 38 38 —
Total 1 $ 1,958 $ 1,958 $ —
6 unchanged sentences
Commercial 2 1,248 1,263 —
+Added: Commercial and Industrial 1 38 38 —
Total 4 $ 1,520 $ 1,535 $ —
2 unchanged sentences
The activity in the allowance for loan loss summarized by primary segments and segregated into the amount required for loans individually evaluated for impairment and the amount required for loans collectively evaluated for potential impairment as of December 31, 2021 and 2020 is summarized below:
−Removed: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Residential Real
6 unchanged sentences
Recoveries 17 — — 43 142 — — 202
−Removed: Provision 285 3,703 604 ( 1,022 ) 33 — 397 4,000
+Added: Provision for Loan Losses (Recovery) ( 833 ) ( 10 ) 360 ( 315 ) ( 162 ) — ( 165 ) ( 1,125 )
December 31, 2021 $ 1,420 $ 5,960 $ 1,249 $ 1,151 $ 1,050 $ — $ 752 $ 11,582
1 unchanged sentence
Collectively Evaluated for Potential Impairment $ 1,420 $ 5,765 $ 1,145 $ 1,151 $ 1,050 $ — $ 752 $ 11,283
+Added: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Residential Real
6 unchanged sentences
Recoveries 6 28 — 33 162 — — 229
−Removed: Provision 1,057 444 ( 110 ) ( 464 ) ( 136 ) — ( 66 ) 725
+Added: Provision for Loan Losses (Recovery) 285 3,703 604 ( 1,022 ) 33 — 397 4,000
December 31, 2020 $ 2,249 $ 6,010 $ 889 $ 1,423 $ 1,283 $ — $ 917 $ 12,771
1 unchanged sentence
Collectively Evaluated for Potential Impairment $ 2,249 $ 5,717 $ 889 $ 1,067 $ 1,283 $ — $ 917 $ 12,122
−Removed: The COVID-19 pandemic has resulted in an increase in unemployment and recessionary economic conditions in 2020.
−Removed: Based on evaluation of the macroeconomic conditions, the qualitative factors used in the allowance for loan loss analysis were increased in 2020 primarily related to economic trends and industry conditions as a result of the pandemic and vulnerable industries such as hospitality and retail.
−Removed: In addition, an increase in commercial real estate loans combined with an increase in the historical loss factor primarily related to a $ 931,000 commercial real estate loan charge-off resulted in an increase commercial real estate loan reserves.
−Removed: The combination of these factors primarily resulted in a $ 4.0 million provision for loan losses for the year ended December 31, 2020.
Prior to 2020, management determined historical loss experience for each segment of loans using a two-year rolling average of the net charge-off data within each loan segment, which was then used in combination with qualitative factors to calculate the general allowance component that covers pools of homogeneous loans that are not specifically evaluated for impairment.
1 unchanged sentence
This change was driven by no net charge-off experience in the commercial real estate and commercial and industrial segments in the prior two-year rolling period as of March 31, 2020, which the Company determined did not represent the inherent risks in those segments.
−Removed: In the first quarter of 2018, the Company incurred $ 1.4 million of commercial and industrial charge-offs, however this period would have been removed from the lookback period as of March 31, 2020 if continuing to use a two-year history.
+Added: In the first quarter of 2018, the Company incurred $ 1.4 million of commercial and industrial charge-offs, however this period would have been removed from the look back period as of March 31, 2020 if continuing to use a two-year history.
In addition, moving to a five-year history is expected to improve the calculation moving forward by capturing economic ebbs and flows over a longer period while also not heavily weighting one period of charge-off activity.
−Removed: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
The following tables present the major classifications of loans summarized by individually evaluated for impairment and collectively evaluated for potential impairment as of December 31, 2021 and 2020:
8 unchanged sentences
Total Loans $ 320,798 $ 392,124 $ 85,028 $ 89,010 $ 122,152 $ 11,684 $ 1,020,796
+Added: December 31, Real
Residential Real
14 unchanged sentences
Balance at December 31, 2021
+Added: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Certain directors and executive officers of the Company, including family members or companies in which they are principal owners, are loan customers of the Company.
Such loans are made in the normal course of business, and summarized as follows:
−Removed: December 31, 2020 2019
(Dollars in Thousands)
3 unchanged sentences
Balance, December 31 $ 15,639 $ 10,893
−Removed: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 5— PREMISES AND EQUIPMENT
10 unchanged sentences
Depreciation and amortization expense on premises and equipment was $ 1.0 million and $ 1.1 million for the years ended December 31, 2021 and 2020, respectively.
+Added: Branch Optimization and Operational Efficiency Initiatives and Impairment of Long-Lived Assets
+Added: In 2021, the Company announced the implementation of branch optimization and operational efficiency strategic initiatives to improve the Bank’s financial performance and operations in order to position the Bank for continued profitable growth through the optimization of its branch network while expanding technology and infrastructure investments in its remaining locations.
+Added: The decision was the result of a comprehensive internal study that measured branch performance by comparing financial and non-financial indicators to growth opportunities, while evolving changes in consumer preferences, largely driven by the global pandemic, led to an acceleration of branch optimization efforts.
+Added: The Bank also completed a comprehensive review of its branch network and operating environment to identify solutions to improve operating performance.
+Added: This review prioritized profitability, efficiency, infrastructure and client experience improvements, automation in operations, and digital marketing and technology investments and the Bank is in process of implementing operational efficiencies related to individualized processes within its branch network and operating environment.
+Added: The Bank has substantially completed these initiatives through the consolidation of six branches that was completed on June 30, 2021.
+Added: In addition, CB Financial, Community Bank, and Citizens Bank of West Virginia, Inc.
+Added: (“Citizens Bank”) executed a Purchase and Assumption Agreement (the “Agreement”) pursuant to which Citizens Bank agreed to purchase certain loans and other assets, and assume certain deposits and other liabilities, of the branch offices of Community Bank located in Buckhannon, West Virginia, and New Martinsville, West Virginia.
+Added: The divestiture of two branches in December 2021 resulted in the sale of $ 102.8 million of deposits, $ 6.1 million of loans and $ 795,000 of premises and equipment and the recognition of a $ 5.2 million pre-tax gain on sale from a 5.0 % premium paid by Citizens Bank on the assumed deposits.
+Added: The branch optimization initiative reduced the Bank's branch network to 14 branches
+Added: As a result of the events and changes in circumstances associated with the branch optimization initiatives whereby six branches were consolidated and two others were divested, the Company performed assessments of the recoverability of long-lived assets to determine whether their carrying values may not be recoverable.
+Added: Utilizing guidance in ASC 360, the Company performed the three step process to identify, recognize and measure the impairment of the long-lived assets.
+Added: • For the six locations that were consolidated:
+Added: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
+Added: ◦ Three locations were written down to the fair value of the land based on the appraised value due to plans to raze the buildings.
+Added: ◦ Two locations were marketed for sale and were written down to fair value based on the appraised value.
+Added: One of these locations was subsequently donated resulting in a $ 230,000 charitable donation.
+Added: ◦ One location was leased.
+Added: Refer to Note 15 for further discussion of the impairment of the right of use asset associated with the operating lease.
+Added: • For the two branches that were divested, the fair value of the premises and equipment was determined using the contractual terms of the Agreement, whereby the premises and equipment were purchased at the acquisition date for $ 795,000 based on the Company's net book value, net of a $ 338,000 contractual discount.
+Added: For the year ended December 31, 2021, the Company recognized $ 2.3 million in charges on the premises and equipment as a Writedown on Premises and Equipment in the Consolidated Statements of Income (Loss).
+Added: The branch optimization and operational efficiency initiatives resulted in $ 7.5 million of restructuring-related and other expenses for the year ended December 31, 2021.
+Added: The expenses include the aforementioned $ 2.3 million writedown on premises and equipment and $ 1.2 million impairment of intangible assets associated with the branch sales (refer to Note 6 for further information), as well as $ 4.1 million of expenses related to contracted services, employee severance costs, branch lease impairment (refer to Note 14 for further information), professional fees, data processing fees, charitable donations, legal and other expenses for the year ended December 31, 2021.
NOTE 6— GOODWILL AND INTANGIBLE ASSETS
The COVID-19 pandemic that has impacted the U.S.
−Removed: and most of the world along with government response to curtail the spread of the virus beginning in March 2020 has significantly impacted our market area.
−Removed: These restrictions have resulted in significant adverse effects on macroeconomic conditions, and stock market valuations have decreased substantially for most companies in the banking sector, including the Company.
+Added: and most of the world along with the government response to curtail the spread of the virus beginning in March 2020 impacted our market area, resulting in significant adverse effects on macroeconomic conditions and a substantial decrease in stock market valuations for most companies in the banking sector, including the Company.
In light of the adverse circumstances resulting from COVID-19, management determined it was necessary to quantitatively evaluate goodwill for impairment at September 30, 2020.
24 unchanged sentences
Value ratios generally reflect the trends in growth, performance and stability of the financial results of operations.
−Removed: In this way, the business and financial risks exhibited by an industry or group of companies can be viewed in relation to market values.
−Removed: Value ratios also reflect the market’s outlook for the economy as a whole.
−Removed: Guideline companies
+Added: In this way, the business and financial risks exhibited by an industry or group of companies can be viewed
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
−Removed: provide a reasonable basis for comparison to the relative investment characteristics of the company being valued.
+Added: in relation to market values.
+Added: Value ratios also reflect the market’s outlook for the economy as a whole.
+Added: Guideline companies provide a reasonable basis for comparison to the relative investment characteristics of the company being valued.
Utilizing publicly traded companies located in Pennsylvania and surrounding states with assets between $1.0 billion and $2.5 billion and return on assets greater than 0.5%, the Company analyzed the relationships between the guideline companies' asset size, profitability, asset quality and capital ratios and applied a control premium of 34 % to the selected guideline company multiples.
2 unchanged sentences
While the banking industry typically has a sufficient level of mergers and acquisitions activity to rely on this method under the market approach, there were only seven transactions involving target institutions with assets greater than $1 billion announced since March 1, 2020 (post-COVID) through the September 30, 2020 assessment date.
−Removed: Of these, only two have closed.
+Added: Of these, only two had closed.
Therefore, the Company was unable to rely on this method in our analysis.
6 unchanged sentences
This was a non-cash charge to earnings and had no impact on regulatory capital, cash flows or liquidity position.
−Removed: The Company performed a qualitative assessment for the annual impairment goodwill test completed as of October 31, 2020 and December 31, 2020 to determine if there was a material change in the most recent quantitative assessment that was performed at September 30, 2020.
−Removed: The Company determined there were not significant changes in macroeconomic conditions, stock price performance, overall financial performance and other relevant or entity-specific events since the most recent quantitative assessment that it is not more likely than not that goodwill was further impaired.
+Added: The Company performed qualitative assessments for the annual goodwill impairment tests completed as of October 31, 2021 and 2020, respectively to determine if there was a material change in the quantitative assessment that was performed at September 30, 2020 or other triggering events to indicate whether any further quantitative testing for impairment was necessary.
+Added: The Company determined there were not significant changes in macroeconomic conditions, stock price performance, overall financial performance and other relevant or entity-specific events that it is not more likely than not that goodwill was further impaired.
The following table presents the changes in the Company's carrying amount of goodwill at the dates indicated.
(Dollars in Thousands)
−Removed: December 31, 2018 and 2019
−Removed: Goodwill Impairment ( 18,693 )
December 31, 2019
+Added: Goodwill Impairment ( 18,693 )
+Added: December 31, 2020 and 2021
Intangible Assets
The following table presents a summary of intangible assets subject to amortization at the dates indicated.
−Removed: December 31, Gross Carrying Amount Accumulated Amortization Net Carrying Value Gross Carrying Amount Accumulated Amortization Net Carrying Value
+Added: December 31, Gross Carrying Amount Accumulated Amortization Impairment Net Carrying Value Gross Carrying Amount Accumulated Amortization Net Carrying Value
(Dollars in Thousands)
2 unchanged sentences
Total Intangible Assets $ 15,903 $ ( 9,430 ) $ ( 1,178 ) $ 5,295 $ 15,903 $ ( 7,504 ) $ 8,399
+Added: On June 10, 2021, an Agreement was executed with Citizens Bank pursuant to which Citizens Bank agreed to assume certain deposits of the branch offices of Community Bank located in Buckhannon, West Virginia, and in New Martinsville, West Virginia.
+Added: In 2018, the Company recorded a core deposit intangible asset related to the acquisition of these two branches as part of the merger with First West Virginia Bancorp, Inc.
+Added: As a result of signing the Agreement and the sale of a portion of the
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
−Removed: Amortization of other intangible assets totaled $ 2.1 million for the years ended December 31, 2020 and 2019.
+Added: deposits associated with the remaining core deposit intangible, the Company performed an evaluation to determine whether the core deposit intangible was impaired.
+Added: As a result of the evaluation, the Company determined the carrying amount of the core deposit intangible was impaired $ 1.2 million.
+Added: The Company recorded the impairment in Intangible Asset and Goodwill Impairment on the Consolidated Statements of Income (Loss).
+Added: Amortization of intangible assets totaled $ 1.9 million and $ 2.1 million for the years ended December 31, 2021 and 2020, respectively.
The estimated amortization expense of intangible assets assumes no activities, such as acquisitions, which would result in additional amortizable intangible assets.
15 unchanged sentences
The balance in time deposits that meet or exceed the FDIC insurance limit of $250,000 totaled $ 40.6 million and $ 59.2 million as of December 31, 2021 and 2020, respectively.
−Removed: The aggregate amount of demand deposits that are overdrawn and have been reclassified as loans was $ 231,000 and $ 1.7 million as of as of December 31, 2020 and 2019, respectively.
+Added: The aggregate amount of demand deposits that are overdrawn and have been reclassified as loans was $ 192,000 and $ 231,000 as of December 31, 2021 and 2020, respectively.
Certain directors and executive officers of the Company, including family members or companies in which they are principal owners, are deposit customers of the Company.
The total deposits of directors and executive officers was $ 7.3 million and $ 6.0 million as of December 31, 2021 and 2020, respectively.
−Removed: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 8— SHORT-TERM BORROWINGS
+Added: Borrowings with original maturities of one year or less are classified as short-term and may consist of borrowings with the FHLB, securities sold under agreements to repurchase or borrowings on revolving lines of credit with the Federal Reserve Bank or other correspondent banks.
+Added: Securities sold under repurchase agreements are comprised of customer repurchase agreements, which are overnight sweep accounts with next-day maturities utilized by commercial customers to earn interest on their funds.
+Added: government agencies, mortgage-backed securities, and collateralized mortgage obligations are pledged as collateral under these agreements in an amount at least equal to the outstanding balance and the collateral pledging requirements are monitored on a daily basis.
+Added: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
The following table sets forth the components of short-term borrowings for the years indicated.
10 unchanged sentences
NOTE 9— OTHER BORROWED FUNDS
−Removed: Other borrowed funds consist of fixed rate, long-term advances from the FHLB with remaining maturities as follows:
+Added: FHLB, Federal Reserve Bank, and Fed Fund Borrowing Arrangements
+Added: The Bank maintained a credit arrangement with the FHLB with a maximum borrowing limit of approximately $ 427.2 million and $ 421.5 million as of December 31, 2021 and 2020, respectively, and available borrowing capacity of $ 347.1 million at December 31, 2021.
+Added: This arrangement is subject to annual renewal and is secured by a blanket security agreement on $ 573.5 million of residential and commercial mortgage loans and the Bank’s investment in FHLB stock.
+Added: Under this arrangement the Bank had available a variable rate line of credit in the amount of $ 150.0 million as of December 31, 2021 and 2020, of which, there was no outstanding balance as of December 31, 2021 and 2020.
+Added: Fixed rate, long-term advances from the FHLB with remaining maturities are as follows at the dates indicated:
December 31, Amount Weighted
5 unchanged sentences
Total $ 3,000 2.41 $ 8,000 2.27
−Removed: The Bank maintained a credit arrangement with the FHLB with a maximum borrowing limit of approximately $ 421.5 million and $ 374.8 million as of December 31, 2020 and 2019, respectively, and available borrowing capacity of $ 320.8 million at December 31, 2020.
−Removed: This arrangement is subject to annual renewal, incurs no service charge, and is secured by a blanket security agreement on $ 564.7 million of residential and commercial mortgage loans and the Bank’s investment in FHLB stock.
−Removed: Under this arrangement the Bank had available a variable rate line of credit in the amount of $ 150.0 million as of December 31, 2020 and 2019, respectively, of which, there was no outstanding balance as of December 31, 2020 and 2019.
As an alternative to pledging securities, the FHLB periodically provides standby letters of credit on behalf of the Bank to secure certain public deposits in excess of the level insured by the FDIC.
1 unchanged sentence
Standby letters of credit issued on our behalf by the FHLB to secure public deposits were $ 62.0 million and $ 90.3 million as of December 31, 2021 and 2020.
−Removed: The Bank maintains a Borrower-In-Custody of Collateral line of credit agreement with the Federal Reserve Bank (“FRB”) for $ 91.5 million that requires monthly certification of collateral, is subject to annual renewal, incurs no service charge and is secured by $ 133.8 million of commercial and consumer indirect auto loans.
−Removed: The Bank also maintains multiple line of credit arrangements with various unaffiliated banks totaling $ 60.0 million as of December 31, 2020 and 2019, respectively, of which no draws had been taken.
+Added: The Bank maintains a Borrower-In-Custody of Collateral line of credit agreement with the Federal Reserve Bank (“FRB”) for $ 86.3 million that requires monthly certification of collateral, is subject to annual renewal and is secured by $ 134.6 million of commercial and consumer indirect auto loans.
+Added: The Bank also maintains multiple line of credit arrangements with various unaffiliated banks totaling $ 50.0 million and $ 60.0 million as of December 31, 2021 and 2020, respectively, of which no draws had been taken.
The Company is not a party to any credit arrangements.
+Added: Subordinated Debt
+Added: In December 2021, the Company entered into a term loan in the principal amount of $ 15.0 million, evidenced by a term note which matures on December 15, 2031 ("2031 Note").
+Added: The 2031 Note is an unsecured subordinated obligation of the Company and may be repaid in whole or in part, without penalty, on any interest payment date on or after December 15, 2026 and at any time upon the occurrence of certain events.
+Added: The 2031 Note initially bears a fixed interest rate of 3.875 % per year to, but excluding, December 15, 2026 and thereafter at a floating rate equal to the then-current three-month term SOFR plus 280 basis
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
+Added: The 2031 Note qualifies as Tier 2 capital under regulatory guidelines.
+Added: The 2031 Note is recorded on the Consolidated Statements of Financial Condition in Other Borrowed Funds, net of remaining debt issuance costs.
+Added: At December 31, 2021, the principal balance and unamortized debt issuance costs for the 2031 Note were $ 15.0 million and $ 399,000 , respectively.
NOTE 10— INCOME TAXES
5 unchanged sentences
Total Provision $ 3,125 $ 1,248
+Added: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
The tax effects of deductible and taxable temporary differences that gave rise to significant portions of the net deferred tax assets and liabilities are as follows:
5 unchanged sentences
Amortization of Intangibles 95 85
−Removed: Tax Credit Carryforwards — 1,207
Unrealized Loss of AFS - Merger Tax Adjustment 789 849
Postretirement Benefits 23 25
+Added: Net Unrealized Loss on Securities 254 —
Net Unrealized Loss on Equity Securities — 71
1 unchanged sentence
Gas Lease - Deferred Revenue 65 102
+Added: Accrued Payroll 33 —
Purchase Accounting Adjustments - Acquired Loans 156 255
Lease Liability 189 260
+Added: Right of Use Asset Impairment 43
+Added: Restructuring Costs 238 —
Gross Deferred Tax Assets 4,533 4,570
7 unchanged sentences
ROU Asset 194 259
−Removed: Purchase Accounting Adjustment - Core Deposit Intangible 1,513 1,930
+Added: Purchase Accounting Adjustments - Core Deposit Intangible 948 1,513
Purchase Accounting Adjustments - Fixed Assets 25 69
−Removed: Purchase Accounting Adjustments - Certificates of Deposit — 16
Goodwill 74 74
Gross Deferred Tax Liabilities 3,164 4,636
−Removed: Net Deferred Tax Liabilities $ ( 66 ) $ ( 95 )
−Removed: Deferred taxes at December 31, 2020 and 2019, are included in Accrued Interest Receivable and Other Assets in the accompanying Consolidated Statement of Financial Condition.
−Removed: While the Tax Cuts and Jobs Act (“Tax Act”) enacted in 2017 was the first major overhaul of the Internal Revenue Code (“IRC”) in the last 30 years, it had many items that were left unaddressed once certain tax deadlines passed and for which no formal regulations had been issued as of December 31, 2018.
−Removed: One of these unaddressed tax deadlines was the expiration of the
+Added: Net Deferred Tax Assets (Liabilities) $ 1,369 $ ( 66 )
+Added: Deferred taxes at December 31, 2021 and 2020, are included in Accrued Interest Receivable and Other Assets in the accompanying Consolidated Statements of Financial Condition.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
−Removed: alternative minimum tax (“AMT”) credit carryforward after the 2021 tax year.
−Removed: Pre–Tax Act regulations allowed for AMT credits to carryforward infinitely.
−Removed: As of December 31, 2018, it was determined that an AMT credit carryforward of approximately $ 1.3 million, acquired in the FWVB merger on April 30, 2018, would remain unutilized as of December 31, 2021 as a result of IRC Section 382 and 383 annual limitations.
−Removed: As a result of the uncertainty of the utilization of the AMT credit carryforwards post-2021, a valuation allowance (“VA”) was established for the AMT credit carryforward deferred tax asset (“DTA”) balance of $ 1.3 million, which was offset against goodwill at December 31, 2018.
−Removed: This is in accordance with ASC Topic 805 – Business Combinations , due to the AMT credit carryforward being realized under current tax law and minimal possibility of utilization as of the 2021 tax year, deemed to have no current value and offset into goodwill as a purchase accounting adjustment.
−Removed: During the fourth quarter of the year ended December 31, 2019, the IRS issued clarifying guidance under IRC Section 382(h) that provided an alternative approach to calculating unrealized built-in gains (“UBIGs”) related to the FWVB acquisition that impact annual Section 382 limitations.
−Removed: This approach is referred to as the “Section 338” approach and allows for the “realization” of UBIGs based on a “deemed asset acquisition” method, rather than “actual realization”, which accelerates UBIGs utilization and increases the annual Section 382 limitations.
−Removed: The Company performed an analysis of its built-in gains associated with the FWVB acquisition and elected to change its approach from the Section 1374 approach to the Section 338 approach in determining its annual limitations under section 382 and 383.
−Removed: As a result of this analysis as well as consideration of a number of factors, including the Company's current profitability, its forecast of future profitability, and evaluation of existing tax regulations related to NOL and AMT credit carryforwards, the Company concluded that it was more likely than not that it will generate sufficient taxable income within the applicable carryforward periods to realize its net operating loss (“NOL”) and AMT credit carryforwards by December 31, 2021.
−Removed: Therefore, for the year ended December 31, 2019, the Company recognized an income tax benefit of $ 1.3 million related to the reversal of 100% of the VA for the AMT credit carryforward.
−Removed: No other VA was established against the remaining DTA in view of the Company’s cumulative history of earnings and anticipated future taxable income as evidenced by the Company’s earnings potential at December 31, 2020 and 2019.
A reconciliation of the federal income tax expense at statutory income tax rates and the actual income tax expense on income before taxes for the periods indicated is as follows:
7 unchanged sentences
Goodwill Impairment 1 — 3,594 ( 38.3 )
−Removed: Reversal of the AMT Tax Credit Carryforward VA — — ( 1,311 ) ( 8.2 )
Other 168 1.0 ( 120 ) 1.3
7 unchanged sentences
The Company maintains a Cash or Deferred Profit-sharing Section 401(k) Plan with contributions matching those by eligible employees for the first 4 % of an employee’s contribution at the rate of $ 0.25 on the dollar.
−Removed: All employees who are over the age of 18 and completed six months of employment are eligible to participate in the plan.
+Added: All employees who are over the age of 18 and completed three months of employment are eligible to participate in the plan.
The Company made contributions of $ 296,000 and $ 234,000 for the years ended December 31, 2021 and 2020, respectively, to this plan.
The 401(k) Plan includes a “safe harbor” provision and a discretionary retirement contribution.
−Removed: The Company made contributions of $ 620,000 and
−Removed: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
−Removed: $ 706,000 for the “safe harbor” provision and discretionary retirement contribution for the years ended December 31, 2020 and 2019, respectively.
+Added: The Company made contributions of $ 659,000 and $ 620,000 for the “safe harbor” provision and discretionary retirement contribution for the years ended December 31, 2021 and 2020, respectively.
Equity Incentive Plan
−Removed: Details of the restricted stock award and stock option grants under the 2015 Equity Incentive Plan are summarized for the years ended December 31, 2020 and 2019 as follows.
+Added: Details of the restricted stock award and stock option grants under the 2015 Equity Incentive Plan are summarized for the year ended December 31, 2020 as follows.
+Added: The Company did not grant restricted stock awards or stock options for the year ended December 31, 2021
Number of Restricted Shares Granted 42,100
9 unchanged sentences
Weighted Average Grant Date Fair Value $ 2.08
−Removed: The Company generally recognizes expense over a five-year vesting period for the restricted stock awards and stock options.
−Removed: Stock-based compensation expense related to restricted stock awards and stock options was $ 498,000 and $ 323,000 for the years ended December 31, 2020 and 2019, respectively.
+Added: The Company recognizes expense over a five-year vesting period for the restricted stock awards and stock options.
+Added: Stock-based compensation expense related to restricted stock awards and stock options was $ 566,000 and $ 498,000 for the years ended
+Added: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
+Added: December 31, 2021 and 2020, respectively.
As of December 31, 2021 and 2020, total unrecognized compensation expense was $ 65,000 and $ 148,000 , respectively, related to stock options, and $ 1.3 million and $ 1.8 million related to restricted stock awards.
+Added: At December 31, 2021, the unrecognized compensation expense related to stock options and restricted stock is expected to be recognized over the weighted average remaining vesting period of 3.67 years and 3.96 years, respectively.
The Company accrued tax benefit for non-qualified stock options of $ 5,000 and $ 11,000 for the years ended December 31, 2021 and 2020, respectively.
Intrinsic value represents the amount by which the fair value of the underlying stock at December 31, 2021 and 2020, exceeds the exercise price of the stock options.
−Removed: The intrinsic value of stock options was $ 21,000 and $ 1.4 million at December 31, 2020 and 2019, respectively.
−Removed: At December 31, 2020 and 2019, respectively, there were 19,723 and 13,359 shares available under the Plan to be issued in connection with the exercise of stock options, and 22,144 and 60,124 shares that may be issued as restricted stock awards or units.
−Removed: Restricted stock awards or units may be issued above this amount provided that the number of shares reserved for stock options is reduced by three shares for each restricted stock award or unit share granted.
−Removed: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
−Removed: The following table presents stock option data for the years indicated:
+Added: The intrinsic value of outstanding stock options was $ 296,000 and $ 21,000 at December 31, 2021 and 2020, respectively.
+Added: At December 31, 2021, there were 500,000 shares of common stock available and reserved under the 2021 Plan to be issued of which a maximum of 500,000 shares may be issued as stock options and 200,000 shares may be issued as restricted stock awards or units based on the terms of the Plan whereby the Share Limit is reduced, on a one-for-one basis, for each share of common stock subject to a stock option grant, and on a two and one-half-for-one basis for each share of common stock issued pursuant to restricted stock awards or units.
+Added: At December 31, 2021, no shares have been granted under the 2021 Plan.
+Added: At December 31, 2020, under the 2015 Plan, 19,723 and 22,144 shares were available to be issued in connection with the exercise of stock options and restricted stock awards or units, respectively.
+Added: The 2015 Plan shall remain in effect as long as any awards are outstanding, but as a result of the approval of the 2021 Plan, no more awards can be granted under the 2015 Plan.
+Added: The following table presents stock option data for the period indicated:
Number of Shares Weighted Average Exercise Price Weighted Average Remaining Contractual
−Removed: Life in Years Number of Shares Weighted Average Exercise Price Weighted Average Remaining Contractual
Life in Years
−Removed: Outstanding at beginning of year 245,153 $ 24.36 6.5 248,006 $ 24.39 7.5
−Removed: Granted 15,000 18.60 5,000 23.60
+Added: Outstanding Options at December 31, 2020 218,683 $ 23.91 5.8
Exercised ( 8,600 ) 21.29
Forfeited ( 2,442 ) 24.18
−Removed: Outstanding at end of year 218,683 23.91 5.8 245,153 24.36 6.5
−Removed: Exercisable at end of year 180,241 $ 23.80 5.4 166,974 $ 23.71 6.3
−Removed: Number of Shares Weighted Average Exercise Price Weighted Average Remaining Service Period in Years Number of Shares Weighted Average Exercise Price Weighted Average Remaining Service Period in Years
−Removed: Nonvested at end of year 38,442 $ 24.40 8.0 78,179 $ 25.76 7.0
−Removed: The following table presents restricted stock award data at the dates indicated.
−Removed: Number of Shares Weighted Average Grant Date Fair Value Price Weighted Average Remaining Service Period in Years
−Removed: Nonvested at December 31, 2018 18,750 $ 25.45 5.0
−Removed: Granted 33,350 30.32 9.9
+Added: Outstanding Options at December 31, 2021 207,641 24.01 4.8
+Added: Exercisable Options at December 31, 2021 187,015 $ 24.17 4.4
+Added: Number of Shares Weighted Average Exercise Price Weighted Average Remaining Service Period in Years
+Added: Nonvested Options December 31, 2020 38,442 $ 24.40 8.0
Vested ( 17,816 ) 26.43
−Removed: Forfeited ( 400 ) 25.45
−Removed: Nonvested at December 31, 2019 48,030 $ 28.83 8.1
−Removed: Granted 42,100 20.17 5.5
+Added: Nonvested Options December 31, 2021 20,626 $ 22.64 7.8
+Added: The following table presents restricted stock award data for the period indicated.
+Added: Number of Shares Weighted Average Grant Date Fair Value Price Weighted Average Remaining Service Period in Years
+Added: Nonvested Restricted Stock at December 31, 2020 76,190 $ 24.08 6.3
Vested ( 19,600 ) 24.67 5.2
Forfeited ( 450 ) 20.38
−Removed: Nonvested at December 31, 2020 76,190 $ 24.08 6.3
+Added: Nonvested Restricted Stock at December 31, 2021 56,140 $ 23.90 5.3
+Added: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 12— COMMITMENTS AND CONTINGENT LIABILITIES
1 unchanged sentence
These financial instruments include commitments to extend credit and standby and performance letters of credit.
−Removed: Those instruments involve, to varying degrees, elements of credit and interest rate risk in excess of the amount recognized in the Statement of Financial Condition.
+Added: Those instruments involve, to varying degrees, elements of credit and interest rate risk in excess of the amount recognized in the Consolidated Statements of Financial Condition.
The contract amounts of those instruments reflect the extent of involvement the Company has in particular classes of financial instruments.
1 unchanged sentence
The Company uses the same credit policies in making commitments and conditional obligations as it does for on-balance-sheet instruments.
−Removed: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
+Added: Commitments and conditional obligations are evaluated the same as on-balance-sheet instruments but do not have a corresponding reserve recorded.
+Added: The Company’s opinion on not implementing a corresponding reserve for off-balance-sheet instruments is supported by historical factors of no losses recorded due to these items.
+Added: The Company is continually evaluating these items for credit quality and any future need for the corresponding reserve.
The unused and available credit balances of financial instruments whose contracts represent credit risk are as follows:
21 unchanged sentences
The Company recorded no liability associated with standby letters of credit as of December 31, 2021 and 2020.
−Removed: NOTE 13— REGULATORY CAPITAL
+Added: NOTE 13— STOCKHOLDERS'S EQUITY AND REGULATORY CAPITAL
+Added: In June 2021, the Company authorized a program to repurchase up to $ 7.5 million of its outstanding shares of common stock.
+Added: Under the program, repurchases may be transacted in the open-market or in negotiated private transactions and are conducted pursuant to a trading plan adopted in accordance with limitations set forth in Rule 10b5-1 of the Securities and Exchange Commission.
+Added: The Rule 10b5-1 repurchase plan allows the Company to repurchase its shares during periods when it would normally not be active in the market due to its internal trading blackout period.
+Added: Repurchases are made at management’s discretion at prices management considers to be attractive and in the best interests of both the Company and its stockholders, subject to various factors, including but not limited to, the availability of stock, general market conditions, the trading price of the stock, alternative uses for capital, and the Company’s financial performance.
+Added: As of December 31, 2021, the Company had repurchased 177,156 shares at an average price of $ 23.24 per share for a total of $ 4.1 million.
+Added: On February 15, 2022, the Company completed this stock repurchase program.
+Added: In connection with the program, the Company repurchased a total of 308,996 shares of the Company’s common stock at an average price of $ 24.27 per share.
+Added: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
+Added: On January 28, 2022, the Company's Board of Directors declared a cash dividend of $ 0.24 per outstanding share of common stock, which was paid on February 28, 2022.
The Bank is subject to various regulatory capital requirements administered by the federal banking agencies.
4 unchanged sentences
As of December 31, 2021 and 2020, the Bank was considered "well capitalized" under the regulatory framework for prompt corrective action.
−Removed: At December 31, 2020, the Bank's capital ratios were not affected by loans modified in accordance with Section 4013 of the CARES Act.
+Added: At December 31, 2021 and 2020, the Bank's capital ratios were not affected by loans modified in accordance with Section 4013 of the CARES Act.
In addition, PPP loans received a zero-percent risk weight under the regulatory capital rules regardless of whether they were pledged as collateral to the Federal Reserve Bank's PPP lending facility, but were included in the Bank's leverage ratio requirement due to the Bank not pledging the loans as collateral to the PPP lending facility.
−Removed: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
The following table presents the Bank’s regulatory capital amounts and ratios, as well as the minimum amounts and ratios
−Removed: required to be well capitalized at December 31, 2020 and 2019.
+Added: required to be well capitalized at the dates indicated.
December 31, Amount Ratio Amount Ratio
19 unchanged sentences
In accordance with ASC Topic 842, leases are defined as either operating or finance leases.
−Removed: The Company's lease contracts are classified as operating leases and create operating ROU assets and corresponding lease liabilities on the balance sheet.
−Removed: The leases are ROU assets of land and building for branch and loan production locations.
−Removed: The Company adopted ASC Topic 842 using the prospective method approach to all identified lease contracts or agreements, which permitted the Company to not restate comparative periods.
−Removed: In addition, since there were no readily determinable rates implicit in the operating leases, the incremental borrowing rate based on the lease term was used upon lease inception or as of the January 1, 2019 transition date.
−Removed: ROU assets are reported in Accrued Interest Receivable and Other Assets and the related lease liabilities in Accrued Interest Payable and Other Liabilities on the Consolidated Statement of Financial Condition.
−Removed: The following tables present the ROU assets, lease expense, weighted average term, discount rate and maturity analysis of lease liabilities for operating leases for the periods indicated and dates indicated.
+Added: The Company's lease contracts are classified as operating leases and create operating ROU assets and corresponding lease liabilities on the Consolidated Statements of Financial Condition.
+Added: The leases are primarily ROU assets of land and building for branch and loan production locations.
+Added: ROU assets are reported in Accrued Interest Receivable and Other Assets and the related lease liabilities in Accrued Interest Payable and Other Liabilities on the Consolidated Statements of Financial Condition.
+Added: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
+Added: The following tables present the lease expense, ROU assets, weighted average term, discount rate and maturity analysis of lease liabilities for operating leases for the periods and dates indicated.
Year Ended December 31, 2021 2020
(Dollars in Thousands)
−Removed: Operating Lease Expense $ 547 $ 459
−Removed: Variable Lease Expense 36 38
+Added: Operating $ 330 $ 547
+Added: Short-term 34 —
+Added: Variable 31 36
Total Lease Expense $ 395 $ 583
5 unchanged sentences
Weighted Average Discount Rate 2.51 % 2.39 %
−Removed: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
December 31, 2021
7 unchanged sentences
Due After Five Years 319
−Removed: Total $ 1,334
Present Value Discount 101
Lease Liabilities $ 877
+Added: Impairment of ROU Assets
+Added: ROU assets from operating leases are subject to the impairment guidance in ASC 360, Property, Plant, and Equipment, and are reviewed for impairment when indicators of impairment are present.
+Added: ASC 360 requires three steps to identify, recognize and measure impairment.
+Added: If indicators of impairment are present (Step 1), the Company performs a recoverability test (Step 2) comparing the sum of the estimated undiscounted cash flows attributable to the ROU asset in question to the carrying amount.
+Added: If the undiscounted cash flows used in the recoverability test are less than the carrying amount, the Company estimates the fair value of the ROU asset and recognizes an impairment loss when the carrying amount exceeds the estimated fair value (Step 3).
+Added: At June 30, 2021, the Company consolidated six branches as part of its branch optimization initiative.
+Added: One of the branches was leased and the Company performed the three-step evaluation as outlined above to determine whether the operating lease was impaired.
+Added: As part of the recoverability test, the Company elected to exclude operating lease liabilities from the carrying amount of the asset group.
+Added: The undiscounted future cash flows used in the recoverability test were based on assumptions made by the Company rather than market participant assumptions.
+Added: Since an election was made to exclude operating lease liabilities from the asset or asset group, all future cash lease payments for the lease were also excluded.
+Added: In addition, the Company elected to exclude operating lease liabilities from the estimated fair value, consistent with the recoverability test When determining the fair value of the ROU asset, the Company estimated what market participants would pay to lease the asset.
+Added: The ROU asset was valued assuming its highest and best use in its current form.
+Added: Based on the analysis, the Company concluded that the ROU asset for this branch was fully impaired as of June 30, 2021, resulting in a remaining ROU carrying value of zero and the recognition of a $ 227,000 impairment for year ended December 31, 2021.
+Added: The impairment was recognized in Occupancy expense on the Consolidated Statements of Income (Loss).
+Added: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 15— MORTGAGE SERVICING RIGHTS
5 unchanged sentences
Amortization ( 252 ) — ( 252 )
−Removed: Temporary impairment — ( 71 ) ( 71 )
+Added: Valuation Allowance Adjustment — ( 302 ) ( 302 )
December 31, 2020 $ 1,029 $ ( 373 ) $ 656
1 unchanged sentence
Amortization ( 300 ) — ( 300 )
−Removed: Temporary impairment — ( 302 ) ( 302 )
+Added: Valuation Allowance Adjustment — 274 274
December 31, 2021 $ 829 $ ( 99 ) $ 730
−Removed: Real estate loans serviced for others, which are not included in the Consolidated Statement of Financial Condition, totaled $ 105.8 million and $ 100.0 million at December 31, 2020 and 2019, respectively.
+Added: Amortization of MSRs and the period change in the valuation allowance are reported in Other Income on the Consolidated Statements of Income (Loss).
+Added: Real estate loans serviced for others, which are not included in the Consolidated Statements of Financial Condition, totaled $ 96.4 million and $ 105.8 million at December 31, 2021 and 2020, respectively.
NOTE 16— FAIR VALUE DISCLOSURE
9 unchanged sentences
Examples of valuation methodologies that would result in Level 3 classification include option pricing models, discounted cash flows, and other similar techniques.
−Removed: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
This hierarchy requires the use of observable market data when available.
The level in the fair value hierarchy within which the fair value measurement falls is determined based on the lowest level input that is significant to the fair value measurement.
−Removed: The following table presents the financial assets measured at fair value on a recurring basis and reported on the Consolidated Statement of Financial Condition as of the dates indicated, by level within the fair value hierarchy.
+Added: The following table presents the financial assets measured at fair value on a recurring basis and reported on the Consolidated Statements of Financial Condition as of the dates indicated, by level within the fair value hierarchy.
The majority of the Company’s securities are included in Level 2 of the fair value hierarchy.
Fair values for Level 2 securities were primarily determined by a third-party pricing service using both quoted prices for similar assets, when available, and model-based valuation techniques that derive fair value based on market-corroborated data, such as instruments with similar prepayment speeds and default interest rates.
−Removed: The standard inputs that are normally used include benchmark yields of like securities, reportable trades, broker/dealer quotes, issuer spreads, two-sided markets, benchmark securities, bids, offers, and reference data including market research publications.
+Added: The standard inputs that are normally used include benchmark yields of like securities, reportable trades, broker/dealer quotes, issuer spreads, two-sided markets, benchmark securities, bids, offers, and reference data
+Added: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
+Added: including market research publications.
There were no transfers from Level 1 to Level 2 and no transfers into or out of Level 3 during the years ended December 31, 2021 and 2020, respectively.
5 unchanged sentences
Mortgage-Backed Securities - Government-Sponsored Enterprises Level 2 56,559 79,493
+Added: Collateralized Mortgage Obligations - Government Sponsored Enterprises Level 2 86,583 —
+Added: Corporate Debt Level 2 7,450 —
Total Available-for-Sale Debt Securities 222,108 142,897
4 unchanged sentences
Total Securities $ 224,974 $ 145,400
−Removed: The following table presents the financial assets measured at fair value on a nonrecurring basis on the Consolidated Statement of Financial Condition as of the dates indicated by level within the fair value hierarchy.
+Added: The following table presents the financial assets measured at fair value on a nonrecurring basis on the Consolidated Statements of Financial Condition as of the dates indicated by level within the fair value hierarchy.
The table also presents the significant unobservable inputs used in the fair value measurements.
2 unchanged sentences
In cases where valuation techniques included inputs that are unobservable and are based on estimates and assumptions developed by management based on the best information available under each circumstance, the asset valuation is classified as Level 3 inputs.
−Removed: Fair Significant
−Removed: Value Fair Value at December 31, Valuation Unobservable Weighted
−Removed: Financial Asset Hierarchy 2020 2019 Technique Inputs Range Average
+Added: Financial Asset Fair Value Hierarchy December 31,
+Added: 2021 Valuation Technique Significant Unobservable Inputs Range Weighted Average
(Dollars in Thousands)
7 unchanged sentences
10 % to 30 % 26.6 %
+Added: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
+Added: Financial Asset Fair Value Hierarchy December 31,
+Added: 2020 Valuation Technique Significant Unobservable Inputs Range Weighted Average
+Added: (Dollars in Thousands)
+Added: Impaired Loans Individually Assessed Level 3 $ 2,944 Appraisal of Collateral (1)
+Added: Appraisal Adjustments (2)
+Added: 0 % to 50 % —
+Added: MSRs Level 3 656 Discounted Cash Flow Discount Rate 9 % to 11 % 10.0 %
+Added: Prepayment Speed 12 % to 27 % 18.7 %
+Added: OREO Level 3 34 Appraisal of Collateral (1)
+Added: Liquidation Expenses (2)
+Added: 10 % to 30 % —
(1) Fair value is generally determined through independent appraisals of the underlying collateral, which may include various Level 3 inputs, which are not identifiable.
1 unchanged sentence
The range and weighted average of appraisal adjustments and liquidation expense are presented as a percent of the appraisal.
−Removed: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Impaired loans are evaluated and valued at the time the loan is identified as impaired, at the lower of cost or fair value.
8 unchanged sentences
The fair value of an OREO property is determined from a qualified independent appraisal and is classified as Level 3 in the fair value hierarchy.
−Removed: During the year ended December 31, 2020, one commercial real estate OREO property with a fair value of $ 18,000 was sold at a $ 4,000 gain and one residential real estate property with a fair value of $ 40,000 was sold at a $ 20,000 loss.
−Removed: In addition, three residential real estate loans with a fair value of $ 131,000 and one commercial real estate loan with a fair value of $ 34,000 transferred into OREO, of which the three residential properties were subsequently sold at a net loss of $ 2,000 .
−Removed: During the year ended December 31, 2019, one commercial real estate OREO property with a fair value of $ 697,000 was sold at a $ 33,000 gain and one residential real estate property with a fair value of $ 46,000 was sold at a loss of $ 3,000 .
−Removed: In addition, four residential real estate loans with a fair value of $ 439,000 and one commercial real estate loan with a fair value of $ 18,000 transferred into OREO, of which two properties with a fair value of $ 387,000 were subsequently sold at a net loss of $ 36,000 and one property with a fair value of $ 12,000 was donated.
Financial instruments are defined as cash, evidence of an ownership in an entity, or a contract which creates an obligation or right to receive or deliver cash or another financial instrument from/to a second entity on potentially favorable or unfavorable terms.
−Removed: Fair value is the price that would be received to sell an asset or paid to transfer a libility in an orderly transaction between market participants at the measurement date.
+Added: Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.
If no readily available market exists, the fair value estimates for financial instruments should be based upon management’s judgment regarding current economic conditions, interest rate risk, expected cash flows, future estimated losses and other factors, as determined through various option pricing formulas or simulation modeling.
3 unchanged sentences
The estimated fair values of the Company’s financial instruments at the dates indicated are as follows:
−Removed: December 31, Valuation Method Used Carrying Value Fair Value Carrying Value Fair Value
+Added: December 31, Fair Value Hierarchy Carrying Value Fair Value Carrying Value Fair Value
(Dollars in Thousands)
3 unchanged sentences
Non-Interest Bearing Level 1 55,706 55,706 15,275 15,275
−Removed: Securities, Available for Sale See Above 145,400 145,400 197,385 197,385
+Added: Securities See Above 224,974 224,974 145,400 145,400
Loans, Net Level 3 1,009,214 1,039,980 1,031,982 1,073,633
Restricted Stock Level 2 3,403 3,403 3,984 3,984
−Removed: Bank-Owned Life Insurance Level 2 24,779 24,779 24,222 24,222
Mortgage Servicing Rights Level 3 730 773 656 656
3 unchanged sentences
Short-term Borrowings Level 2 39,266 39,266 41,055 41,055
−Removed: Other Borrowed Funds Level 2 8,000 8,067 14,000 15,380
+Added: Other Borrowed Funds
+Added: FHLB Borrowings Level 2 3,000 3,000 8,000 8,067
+Added: Subordinated Debt Level 2 14,601 15,000 — —
Accrued Interest Payable Level 2 486 486 767 767
NOTE 17— OTHER NONINTEREST EXPENSE
−Removed: The details for other noninterest expense for the Company’s Consolidated Statement of Operations are as follows:
+Added: The details for other noninterest expense for the Company’s Consolidated Statements of Income (Loss) are as follows:
Year Ended December 31, 2021 2020
17 unchanged sentences
Financial information pertaining only to CB Financial Services, Inc., is as follows:
−Removed: Statement of Financial Condition
+Added: Statements of Financial Condition
December 31, 2021 2020
6 unchanged sentences
LIABILITIES AND STOCKHOLDERS' EQUITY
+Added: Other Borrowings $ 14,601 $ —
Other Liabilities 104 16
1 unchanged sentence
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 147,829 $ 134,546
−Removed: Statement of Operations
+Added: Statements of Income (Loss)
Year Ended December 31, 2021 2020
2 unchanged sentences
Dividend from Bank Subsidiary 9,675 3,884
−Removed: Noninterest Income (Loss) ( 279 ) 160
+Added: Interest Expense 37 —
+Added: Net Interest and Dividend Income 9,709 3,945
+Added: Net Gain (Loss) on Securities 329 ( 279 )
Noninterest Expense 12 11
−Removed: Income Before Undistributed Net (Loss) Income of Subsidiary and Income Tax (Benefit) Expense 3,655 10,430
−Removed: Undistributed Net (Loss) Income of Subsidiary ( 14,342 ) 3,936
−Removed: (Loss) Income Before Income Tax (Benefit) Expense ( 10,687 ) 14,366
−Removed: Income Tax (Benefit) Expense ( 47 ) 39
−Removed: NET (LOSS) INCOME $ ( 10,640 ) $ 14,327
+Added: Income Before Undistributed Net Income (Loss) of Subsidiary and Income Tax Expense (Benefit) 10,026 3,655
+Added: Undistributed Net Income (Loss) of Subsidiary 1,607 ( 14,342 )
+Added: Income (Loss) Before Income Tax Expense (Benefit) 11,633 ( 10,687 )
+Added: Income Tax Expense (Benefit) 63 ( 47 )
+Added: NET INCOME (LOSS) $ 11,570 $ ( 10,640 )
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
−Removed: Statement of Cash Flows
+Added: Statements of Cash Flows
Year Ended December 31, 2021 2020
1 unchanged sentence
OPERATING ACTIVITIES
−Removed: Net (Loss) Income $ ( 10,640 ) $ 14,327
−Removed: Adjustments to Reconcile Net (Loss) Income to Net Cash Provided By Operating Activities:
−Removed: Undistributed Net (Loss) Income of Subsidiary 14,342 ( 3,936 )
+Added: Net Income (Loss) $ 11,570 $ ( 10,640 )
+Added: Adjustments to Reconcile Net Income (Loss) to Net Cash Provided By Operating Activities:
+Added: Undistributed Net (Income) Loss of Subsidiary ( 1,607 ) 14,342
Noncash Expense for Stock-Based Compensation 566 498
−Removed: Loss on Equity Securities 279 —
+Added: (Gain) Loss on Equity Securities ( 329 ) 279
Other, net ( 423 ) ( 229 )
5 unchanged sentences
FINANCING ACTIVITIES
+Added: Net Proceeds from Other Borrowings 14,601 —
Cash Dividends Paid ( 5,168 ) ( 5,183 )
1 unchanged sentence
Exercise of Stock Options 98 ( 78 )
−Removed: NET CASH USED IN FINANCING ACTIVITIES ( 7,181 ) ( 5,264 )
−Removed: (DECREASE) INCREASE IN CASH AND EQUIVALENTS ( 2,981 ) 5,421
−Removed: CASH AND CASH EQUIVALENTS AT BEGINNING OF THE YEAR 6,447 1,026
−Removed: CASH AND CASH EQUIVALENTS AT END OF THE YEAR $ 3,466 $ 6,447
−Removed: The Parent Company's Statement of Comprehensive (Loss) Income and Statement of Changes in Stockholders' Equity are identical to the Consolidated Statement of (Loss) Comprehensive Income and the Consolidated Statement of Changes in Stockholders' Equity and are not presented.
+Added: NET PROVIDED BY (CASH USED) IN FINANCING ACTIVITIES 5,388 ( 7,181 )
+Added: INCREASE (DECREASE) IN CASH AND DUE FROM BANKS 15,101 ( 2,981 )
+Added: CASH AND DUE FROM BANKS AT BEGINNING OF THE YEAR 3,466 6,447
+Added: CASH AND DUE FROM BANKS AT END OF THE YEAR $ 18,567 $ 3,466
+Added: The Parent Company's Statements of Comprehensive Income (Loss) and Statements of Changes in Stockholders' Equity are identical to the Consolidated Statements of Comprehensive Income (Loss) and the Consolidated Statements of Changes in Stockholders' Equity and are not presented.
NOTE 19— SEGMENT REPORTING AND RELATED INFORMATION
3 unchanged sentences
Exchange Underwriters has an independent board of directors from the Company and is managed separately from the banking and related financial services that the Company offers.
+Added: Exchange Underwriters is an independent insurance agency that offers property, casualty, commercial liability, surety and other insurance products.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
15 unchanged sentences
Interest Expense 3,368 — 37 — 3,405
−Removed: Net Interest Income 41,839 4 3,945 ( 3,884 ) 41,904
−Removed: Provision for Loan Losses 4,000 — — — 4,000
−Removed: Net Interest Income After Provision for Loan Losses 37,839 4 3,945 ( 3,884 ) 37,904
−Removed: Noninterest Income 4,924 4,826 ( 279 ) — 9,471
−Removed: Noninterest Expense 52,998 3,758 11 — 56,767
−Removed: Undistributed Net Income (Loss) of Subsidiary 780 — ( 14,342 ) 13,562 —
−Removed: (Loss) Income Before Income Tax Expense (Benefit) ( 9,455 ) 1,072 ( 10,687 ) 9,678 ( 9,392 )
−Removed: Income Tax Expense (Benefit) 1,003 292 ( 47 ) — 1,248
−Removed: Net (Loss) Income $ ( 10,458 ) $ 780 $ ( 10,640 ) $ 9,678 $ ( 10,640 )
−Removed: Year Ended December 31, 2019
−Removed: Interest and Dividend Income $ 50,966 $ 3 $ 10,278 $ ( 10,216 ) $ 51,031
−Removed: Interest Expense 7,857 — — — 7,857
−Removed: Net Interest Income 43,109 3 10,278 ( 10,216 ) 43,174
−Removed: Provision for Loan Losses 725 — — — 725
−Removed: Net Interest Income After Provision for Loan Losses 42,384 3 10,278 ( 10,216 ) 42,449
+Added: Net Interest and Dividend Income 40,113 6 9,709 ( 9,676 ) 40,152
+Added: (Recovery) Provision for Loan Losses ( 1,125 ) — — — ( 1,125 )
+Added: Net Interest and Dividend Income After (Recovery) Provision for Loan Losses 41,238 6 9,709 ( 9,676 ) 41,277
Noninterest Income 10,338 5,613 329 — 16,280
4 unchanged sentences
Net Income $ 11,283 $ 1,105 $ 11,570 $ ( 12,388 ) $ 11,570
−Removed: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
−Removed: NOTE 20— QUARTERLY FINANCIAL INFORMATION (Unaudited)
−Removed: The following tables summarize selected information regarding the Company’s results of operations for the periods indicated.
−Removed: Quarterly earnings per share data may vary from annual earnings per share due to rounding.
−Removed: Three Months Ended
−Removed: 2020 June 30,
−Removed: 2020 September 30,
−Removed: 2020 December 31, 2020
−Removed: (Dollars in Thousands, Except Per Share Data)
−Removed: Interest Income $ 12,329 $ 11,727 $ 11,656 $ 11,755
−Removed: Interest Expense 1,796 1,406 1,240 1,121
−Removed: Net Interest Income 10,533 10,321 10,416 10,634
−Removed: Provision for Loan Losses 2,500 300 1,200 —
−Removed: Net Interest Income after Provision for Loan Losses 8,033 10,021 9,216 10,634
−Removed: Noninterest Income 1,872 2,648 2,173 2,778
−Removed: Noninterest Expense 9,003 9,071 28,968 9,725
−Removed: Income (Loss) Before Income Tax Expense (Benefit) 902 3,598 ( 17,579 ) 3,687
−Removed: Income Tax Expense (Benefit) 129 695 ( 184 ) 608
−Removed: Net Income (Loss) $ 773 $ 2,903 $ ( 17,395 ) $ 3,079
−Removed: Earnings (Loss) Per Share - Basic $ 0.14 $ 0.54 $ ( 3.22 ) $ 0.57
−Removed: Earnings (Loss) Per Share - Diluted 0.14 0.54 ( 3.22 ) 0.57
−Removed: Dividends Per Share 0.24 0.24 0.24 0.24
−Removed: Three Months Ended
−Removed: 2019 June 30,
−Removed: 2019 September 30,
−Removed: 2019 December 31, 2019
−Removed: (Dollars in Thousands, Except Per Share Data)
−Removed: Interest Income $ 12,296 $ 12,669 $ 13,098 $ 12,968
+Added: Year Ended December 31, 2020
+Added: Interest and Dividend Income $ 47,402 $ 4 $ 3,945 $ ( 3,884 ) $ 47,467
Interest Expense 5,563 — — — 5,563
−Removed: Net Interest Income 10,434 10,705 11,096 10,939
+Added: Net Interest and Dividend Income 41,839 4 3,945 ( 3,884 ) 41,904
Provision for Loan Losses 4,000 — — — 4,000
−Removed: Net Interest Income after Provision for Loan Losses 10,409 10,355 10,921 10,764
−Removed: Noninterest Income 2,114 2,165 1,966 2,322
+Added: Net Interest and Dividend Income After Provision for Loan Losses 37,839 4 3,945 ( 3,884 ) 37,904
+Added: Noninterest Income (Loss) 4,924 4,826 ( 279 ) — 9,471
Noninterest Expense 52,998 3,758 11 — 56,767
−Removed: Income Before Income Tax Expense (Benefit) 3,643 3,723 4,630 4,060
+Added: Undistributed Net Income (Loss) of Subsidiary 780 — ( 14,342 ) 13,562 —
+Added: (Loss) Income Before Income Tax Expense (Benefit) ( 9,455 ) 1,072 ( 10,687 ) 9,678 ( 9,392 )
Income Tax Expense (Benefit) 1,003 292 ( 47 ) — 1,248
−Removed: Net Income $ 2,925 $ 2,979 $ 3,746 $ 4,677
−Removed: Earnings Per Share - Basic 0.54 0.55 0.69 0.86
−Removed: Earnings Per Share - Diluted 0.54 0.55 0.69 0.85
−Removed: Dividends Per Share 0.24 0.24 0.24 0.24
+Added: Net (Loss) Income $ ( 10,458 ) $ 780 $ ( 10,640 ) $ 9,678 $ ( 10,640 )
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.