What changed in this filing

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Item 1. Financial Statements

2021-08-16 compared with 2021-05-10 · 173 added, 128 removed, 645 unchanged (32% of the section changed)

43 unchanged sentences

Three months ended

Six months ended

Interest and dividend income:

34 unchanged sentences

Three months ended

Six months ended

Other comprehensive income (loss):

12 unchanged sentences

Shareholders'

Balance at January 1, 2021

Balance at April 1, 2021

Other comprehensive loss, net

Cash dividends, $ 0.21 per share

Balance at March 31, 2021

Balance at June 30 , 2021

Balance at April 1, 2020

Other comprehensive loss, net

Cash dividends, $ 0.21 per share

Balance at June 30 , 2020

Comprehensive

Income (Loss)

Shareholders'

Balance at January 1, 2021

1 unchanged sentence

Cash dividends, $ 0.42 per share

Balance at March 31, 2020

Balance at June 30 , 2021

Balance at January 1, 2020

Other comprehensive income, net

Cash dividends, $ 0.42 per share

Balance at June 30 , 2020

See accompanying notes to consolidated financial statements

3 unchanged sentences

(dollars in thousands)

Three months ended

Six months ended

Net cash provided by operating activities:

5 unchanged sentences

Proceeds from maturities of certificates of deposit in financial institutions

Purchase of certificates of deposit in financial institutions

Redemptions of federal home loan bank stock

Net change in loans

1 unchanged sentence

Purchases of premises and equipment

Disposals of premises and equipment

Purchases of bank owned life insurance and annuity assets

Net cash (used in) investing activities

2 unchanged sentences

Cash dividends

Proceeds from Federal Home Loan Bank borrowings

Repayment of Federal Home Loan Bank borrowings

Change in other long-term borrowings

Change in other short-term borrowings

Net cash provided by financing activities

4 unchanged sentences

Cash paid for interest

Cash paid for income taxes

Transfers from loans to other real estate owned

Operating lease liability arising from obtaining right-of-use asset

See accompanying notes to consolidated financial statements

5 unchanged sentences

(“Ohio Valley”) and its wholly-owned subsidiaries, The Ohio Valley Bank Company (the “Bank”), Loan Central, Inc., a consumer finance company (“Loan Central”), Ohio Valley Financial Services Agency, LLC, an insurance agency, and OVBC Captive, Inc., a limited purpose property and casualty insurance company (the “Captive”).

The Bank has one wholly-owned subsidiary, Ohio Valley REO, LLC, an Ohio limited liability company (“Ohio Valley REO”), to which the Bank transfers certain real estate acquired by the Bank through foreclosure for sale by Ohio Valley REO.

The Bank has two wholly-owned subsidiaries, Race Day Mortgage, Inc., a mortgage banking company, and Ohio Valley REO, LLC, an Ohio limited liability company (“Ohio Valley REO”), to which the Bank transfers certain real estate acquired by the Bank through foreclosure for sale by Ohio Valley REO.

Ohio Valley and its subsidiaries are collectively referred to as the “Company.” All material intercompany accounts and transactions have been eliminated in consolidation.

These interim financial statements are prepared by the Company without audit and reflect all adjustments of a normal recurring nature which, in the opinion of management, are necessary to present fairly the consolidated financial position of the Company at March 31, 2021, and its results of operations and cash flows for the periods presented.

The results of operations for the three months ended March 31, 2021 are not necessarily indicative of the operating results to be anticipated for the full fiscal year ending December 31, 2021.

These interim financial statements are prepared by the Company without audit and reflect all adjustments of a normal recurring nature which, in the opinion of management, are necessary to present fairly the consolidated financial position of the Company at June 30, 2021, and its results of operations and cash flows for the periods presented.

The results of operations for the three and six months ended June 30, 2021 are not necessarily indicative of the operating results to be anticipated for the full fiscal year ending December 31, 2021.

The accompanying consolidated financial statements do not purport to contain all the necessary financial disclosures required by U.S.

14 unchanged sentences

It also is possible that asset quality could worsen, and that loan charge-offs could increase.

The Company is actively participating in the Paycheck Protection Program (“PPP”) by providing loans to small businesses negatively impacted by COVID-19.

The Company has participated in the Paycheck Protection Program (“PPP”) by providing loans to small businesses negatively impacted by COVID-19.

PPP loans are fully guaranteed by the U.S.

2 unchanged sentences

Material adverse impacts of COVID-19 may result in valuation impairments on the Company’s securities, impaired loans, goodwill, other real estate owned, and interest rate swap agreements.

NOTE 1- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

USE OF ESTIMATES IN THE PREPARATION OF FINANCIAL STATEMENTS:

7 unchanged sentences

The amount of the Company’s recorded investment is not materially different than the amount of unpaid principal balance for loans.

NOTE 1- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Interest income is discontinued and the loan moved to non-accrual status when full loan repayment is in doubt, typically when the loan is impaired or payments are past due 90 days or over unless the loan is well-secured or in process of collection.

8 unchanged sentences

Loans sold to the secondary market are carried at the lower of aggregate cost or fair value.

As of March 31, 2021, there were $ 275 in loans held for sale by the Bank, as compared to $ 70 in loans held for sale at December 31, 2020.

As of June 30, 2021, there were $ 409 in loans held for sale by the Bank, as compared to $ 70 in loans held for sale at December 31, 2020.

ALLOWANCE FOR LOAN LOSSES:

17 unchanged sentences

For troubled debt restructurings that subsequently default, the Company determines the amount of reserve in accordance with the accounting policy for the allowance for loan losses.

NOTE 1- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

The general component covers non-impaired loans and impaired loans that are not individually reviewed for impairment and is based on historical loss experience adjusted for current factors.

13 unchanged sentences

Commercial and Industrial, Commercial Real Estate, Residential Real Estate, and Consumer.

NOTE 1- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Commercial and industrial loans consist of borrowings for commercial purposes to individuals, corporations, partnerships, sole proprietorships, and other business enterprises.

17 unchanged sentences

The Company has allocated the highest percentage of its allowance for loan losses as a percentage of loans to the other identified loan portfolio segments due to the larger dollar balances associated with such portfolios.

At March 31, 2021, there were no changes to the accounting policies or methodologies within any of the Company’s loan portfolio segments from the prior period.

At June 30, 2021, there were no changes to the accounting policies or methodologies within any of the Company’s loan portfolio segments from the prior period.

EARNINGS PER SHARE:

Earnings per share are computed based on net income divided by the weighted average number of common shares outstanding during the period.

The weighted average common shares outstanding were 4,787,446 for both the three months ended March 31, 2021 and 2020, respectively.

The weighted average common shares outstanding were 4,787,446 for both the three and six months ended June 30, 2021 and 2020, respectively.

Ohio Valley had no dilutive effect and no potential common shares issuable under stock options or other agreements for any period presented.

NOTE 1- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

ACCOUNTING GUIDANCE TO BE ADOPTED IN FUTURE PERIODS:

32 unchanged sentences

Impaired loans are evaluated on a quarterly basis for additional impairment and adjusted accordingly.

NOTE 2 – FAIR VALUE OF FINANCIAL INSTRUMENTS (Continued)

Other Real Estate Owned:

10 unchanged sentences

On an as-needed basis, the Company reviews the fair value of collateral, taking into consideration current market data, as well as all selling costs, which typically amount to approximately 10 % of the fair value of such collateral.

NOTE 2 – FAIR VALUE OF FINANCIAL INSTRUMENTS (Continued)

Interest Rate Swap Agreements:

3 unchanged sentences

Assets and liabilities measured at fair value on a recurring basis are summarized below:

Fair Value Measurements at March 31, 2021 Using

Fair Value Measurements at June 30, 2021 Using

Quoted Prices in Active

8 unchanged sentences

Interest rate swap derivatives

Fair Value Measurements at

December 31, 2020 Using

Fair Value Measurements at December 31, 2020 Using

Quoted Prices in Active

6 unchanged sentences

Interest rate swap derivatives

Liabilities :

Interest rate swap derivatives

There were no transfers between Level 1 and Level 2 during 2021 or 2020.

NOTE 2 – FAIR VALUE OF FINANCIAL INSTRUMENTS (Continued)

Assets and Liabilities Measured on a Nonrecurring Basis

There were no assets or liabilities measured at fair value on a nonrecurring basis at December 31, 2020.

Assets and liabilities measured at fair value on a nonrecurring basis are summarized below:

Fair Value Measurements at

March 31, 2021, Using

Assets and liabilities measured at fair value on a nonrecurring basis at June 30, 2021 are summarized below:

Fair Value Measurements at June 30, 2021 Using

Quoted Prices in Active

Markets for Identical Assets

Significant Other Observable Inputs

Significant Other

Observable Inputs

Unobservable Inputs

Impaired loans:

Commercial real estate:

Owner-occupied

Commercial and industrial

NOTE 2 – FAIR VALUE OF FINANCIAL INSTRUMENTS (Continued)

At March 31, 2021, the recorded investment of impaired loans measured for impairment using the fair value of collateral for collateral-dependent loans totaled $ 2,431 , with a corresponding valuation allowance of $ 90 , resulting in an increase of $ 90 in provision expense during the three months ended March 31, 2021, with no corresponding charge-offs recognized.

This is compared to an increase of $ 854 in provision expense during the three months ended March 31, 2020.

At June 30, 2021, the recorded investment of impaired loans measured for impairment using the fair value of collateral for collateral-dependent loans totaled $ 310 , with a corresponding valuation allowance of $ 60 , resulting in a decrease of $ 30 in provision expense during the three months ended June 30, 2021 and an increase of $ 60 in provision expense during the six months ended June 30, 2021, with no corresponding charge-offs recognized.

This is compared to no impact to provision expense during the three and six months ended June 30, 2020.

At December 31, 2020, the Company had no recorded investment of impaired loans measured for impairment using the fair value of collateral for collateral-dependent loans and, therefore, recorded no impact to provision expense during the year ended December 31, 2020.

There was no other real estate owned that was measured at fair value less costs to sell at March 31, 2021 and December 31, 2020.

There were no corresponding write downs during the three months ended March 31, 2021 and 2020.

The following table presents quantitative information about Level 3 fair value measurements for financial instruments measured at fair value on a non-recurring basis at March 31, 2021

March 31, 2021

There was no other real estate owned that was measured at fair value less costs to sell at June 30, 2021 and December 31, 2020.

There were no corresponding write downs during the three and six months ended June 30, 2021 and 2020.

The following table presents quantitative information about Level 3 fair value measurements for financial instruments measured at fair value on a non-recurring basis at June 30, 2021:

June 30, 2021

Weighted Average

Impaired loans:

Commercial real estate:

Owner-occupied

Sales approach

Adjustment to comparables

Commercial and industrial

1 unchanged sentence

Adjustment to comparables

The carrying amounts and estimated fair values of financial instruments at March 31, 2021 and December 31, 2020 are as follows:

Fair Value Measurements at March 31, 2021 Using

NOTE 2 – FAIR VALUE OF FINANCIAL INSTRUMENTS (Continued)

The carrying amounts and estimated fair values of financial instruments at June 30, 2021 and December 31, 2020 are as follows:

Fair Value Measurements at June 30, 2021 Using

Financial Assets:

23 unchanged sentences

Accrued interest payable

NOTE 2 – FAIR VALUE OF FINANCIAL INSTRUMENTS (Continued)

Fair value estimates are made at a specific point in time, based on relevant market information and information about the financial instrument.

4 unchanged sentences

NOTE 3 – SECURITIES

The following table summarizes the amortized cost and fair value of securities available for sale and securities held to maturity at March 31, 2021 and December 31, 2020 and the corresponding amounts of gross unrealized gains and losses recognized in accumulated other comprehensive (loss) and gross unrecognized gains and losses:

The following table summarizes the amortized cost and fair value of securities available for sale and securities held to maturity at June 30, 2021 and December 31, 2020, and the corresponding amounts of gross unrealized gains and losses recognized in accumulated other comprehensive (loss) and gross unrecognized gains and losses:

Securities Available for Sale

1 unchanged sentence

Gross Unrealized

March 31 , 2021

June 30 , 2021

Government securities

9 unchanged sentences

Gross Unrecognized

March 31 , 2021

June 30 , 2021

Obligations of states and political subdivisions

5 unchanged sentences

Total securities

The amortized cost and estimated fair value of debt securities at March 31, 2021, by contractual maturity, are shown below.

The amortized cost and estimated fair value of debt securities at June 30, 2021, by contractual maturity, are shown below.

Actual maturities may differ from contractual maturities because certain issuers may have the right to call or prepay the debt obligations prior to their contractual maturities.

Securities not due at a single maturity are shown separately.

NOTE 3 – SECURITIES (Continued)

Available for Sale

1 unchanged sentence

Debt Securities:

Amortized Cost

Estimated Fair Value

Amortized Cost

Estimated Fair Value

Due in one year or less

4 unchanged sentences

Total debt securities

The following table summarizes securities with unrealized losses at March 31, 2021 and December 31, 2020, aggregated by major security type and length of time in a continuous unrealized loss position:

March 31, 2021

NOTE 3 – SECURITIES (Continued)

The following table summarizes securities with unrealized losses at June 30, 2021 and December 31, 2020, aggregated by major security type and length of time in a continuous unrealized loss position:

June 30 , 2021

Less Than 12 Months

5 unchanged sentences

Government securities

Government sponsored entity

Agency mortgage-backed

securities, residential

Government sponsored entity securities

Agency mortgage-backed securities,

Total available for sale

6 unchanged sentences

Securities Available for Sale

Agency mortgage-backedsecurities, residential

Agency mortgage-backed securities,

Total available for sale

NOTE 3 – SECURITIES (Continued)

March 31 , 2021

June 30, 2021

Less Than 12 Months

6 unchanged sentences

Total held to maturity

There were no sales of investment securities during the three months ended March 31, 2021 or 2020.

Unrealized losses on the Company’s debt securities have not been recognized into income because the issuers’ securities are of high credit quality as of March 31, 2021, and management does not intend to sell, and it is likely that management will not be required to sell, the securities prior to their anticipated recovery.

Management does no t believe any individual unrealized loss at March 31, 2021 and December 31, 2020 represents an other-than-temporary impairment.

There were no sales of investment securities during the three and six months ended June 30, 2021 or 2020.

Unrealized losses on the Company’s debt securities have not been recognized into income because the issuers’ securities were of high credit quality as of June 30, 2021, and management does not intend to sell, and it is likely that management will not be required to sell, the securities prior to their anticipated recovery.

Management does no t believe any individual unrealized loss at June 30, 2021 and December 31, 2020 represents an other-than-temporary impairment.

NOTE 4 – LOANS AND ALLOWANCE FOR LOAN LOSSES

6 unchanged sentences

Allowance for loan losses

Commercial and industrial loans include $ 25,829 of loans originated under the PPP at March 31 , 2021 compared to $27,933 at December 31, 2020.

Commercial and industrial loans include $ 8,531 of loans originated under the PPP at June 30, 2021.

These loans are guaranteed by the SBA.

The following table presents the activity in the allowance for loan losses by portfolio segment for the three months ended June 30, 2021 and 2020:

June 30 , 2021

and Industrial

Allowance for loan losses:

Beginning balance

Provision for loan losses

Loans charged off

Total ending allowance balance

June 30 , 2020

and Industrial

Allowance for loan losses:

Beginning balance

Provision for loan losses

Loans charged-off

Total ending allowance balance

NOTE 4 – LOANS AND ALLOWANCE FOR LOAN LOSSES (Continued)

The following table presents the activity in the allowance for loan losses by portfolio segment for the three months ended March 31, 2021 and 2020:

March 31 , 2021

The following table presents the activity in the allowance for loan losses by portfolio segment for the six months ended June 30, 2021 and 2020:

June 30, 2021

and Industrial

4 unchanged sentences

Total ending allowance balance

March 31 , 2020

June 30 , 2020

and Industrial

4 unchanged sentences

Total ending allowance balance

The following table presents the balance in the allowance for loan losses and the recorded investment of loans by portfolio segment and based on impairment method as of March 31, 2021 and December 31, 2020:

March 31 , 2021

The following table presents the balance in the allowance for loan losses and the recorded investment of loans by portfolio segment and based on impairment method as of June 30, 2021 and December 31, 2020:

June 30 , 2021

and Industrial

7 unchanged sentences

Total ending loans balance

NOTE 4 – LOANS AND ALLOWANCE FOR LOAN LOSSES (Continued)

December 31, 2020

8 unchanged sentences

Total ending loans balance

The following tables present information related to loans individually evaluated for impairment by class of loans as of March 31, 2021 and December 31, 2020:

March 31 , 2021

Allowance for

NOTE 4 – LOANS AND ALLOWANCE FOR LOAN LOSSES (Continued)

The following tables present information related to loans individually evaluated for impairment by class of loans as of June 30, 2021 and December 31, 2020:

June 30 , 2021

Principal Balance

Allowance for Loan

Losses Allocated

With an allowance recorded:

Commercial real estate:

Owner-occupied

Commercial and industrial

With no related allowance recorded:

Residential real estate

Commercial real estate:

3 unchanged sentences

December 31, 2020

Allowance for

Principal Balance

Allowance for Loan

Losses Allocated

With an allowance recorded:

6 unchanged sentences

NOTE 4 – LOANS AND ALLOWANCE FOR LOAN LOSSES (Continued)

The following tables present information related to loans individually evaluated for impairment by class of loans for the three months ended March 31, 2021 and 2020:

Three months ended

March 31, 2021

The following tables present information related to loans individually evaluated for impairment by class of loans for the three and six months ended June 30, 2021 and 2020:

Three months ended June 30, 2021

Six months ended June 30, 2021

Impaired Loans

1 unchanged sentence

Interest Recognized

Impaired Loans

Interest Income

Interest Recognized

With an allowance recorded:

Commercial real estate:

Owner-occupied

Commercial and industrial

With no related allowance recorded:

Residential real estate

Commercial real estate:

2 unchanged sentences

Commercial and industrial

Three months ended

March 31, 2020

Three months ended June 30, 2020

Six months ended June 30, 2020

Impaired Loans

1 unchanged sentence

Interest Recognized

Impaired Loans

Interest Income

Interest Recognized

With an allowance recorded:

Commercial real estate:

Owner-occupied

Commercial and industrial

With no related allowance recorded:

4 unchanged sentences

Commercial and industrial

The recorded investment of a loan is its carrying value excluding accrued interest and deferred loan fees.

Accrued interest and net deferred loan fees have been excluded from the recorded investment of loans due to immateriality .

Nonaccrual loans and loans past due 90 days or more and still accruing include both smaller balance homogenous loans that are collectively evaluated for impairment and individually classified as impaired loans.

The Company transfers loans to other real estate owned, at fair value less cost to sell, in the period the Company obtains physical possession of the property (through legal title or through a deed in lieu).

As of March 31, 2021, there were no other real estate owned for residential real estate properties, as compared to $ 43 at December 31, 2020.

In addition, nonaccrual residential mortgage loans that are in the process of foreclosure had a recorded investment of $ 693 and $ 1,097 as of March 31, 2021 and December 31, 2020, respectively.

As of June 30, 2021, there were no other real estate owned for residential real estate properties, as compared to $ 43 at December 31, 2020.

In addition, nonaccrual residential mortgage loans that are in the process of foreclosure had a recorded investment of $ 763 and $ 1,097 as of June 30, 2021 and December 31, 2020, respectively.

NOTE 4 – LOANS AND ALLOWANCE FOR LOAN LOSSES (Continued)

The following table presents the recorded investment of nonaccrual loans and loans past due 90 days or more and still accruing by class of loans as of March 31, 2021 and December 31, 2020:

March 31 , 2021

The following table presents the recorded investment of nonaccrual loans and loans past due 90 days or more and still accruing by class of loans as of June 30, 2021 and December 31, 2020:

June 30 , 2021

Loans Past Due

14 unchanged sentences

NOTE 4 – LOANS AND ALLOWANCE FOR LOAN LOSSES (Continued)

The following table presents the aging of the recorded investment of past due loans by class of loans as of March 31, 2021 and December 31, 2020:

March 31 , 2021

The following table presents the aging of the recorded investment of past due loans by class of loans as of June 30, 2021 and December 31, 2020:

June 30 , 2021

Residential real estate

19 unchanged sentences

NOTE 4 – LOANS AND ALLOWANCE FOR LOAN LOSSES (Continued)

The following table presents the types of TDR loan modifications by class of loans as of March 31, 2021 and December 31, 2020:

March 31 , 2021

Performing to

The following table presents the types of TDR loan modifications by class of loans as of June 30, 2021 and December 31, 2020:

June 30 , 2021

Performing to Modified Terms

Commercial real estate:

8 unchanged sentences

December 31, 2020

Performing to

Performing to Modified Terms

Residential real estate:

9 unchanged sentences

Interest only payments

The Company had no specific allocations in reserves to customers whose loan terms have been modified in TDRs at March 31, 2021 and December 31, 2020.

At March 31, 2021, the Company had $ 2,465 in commitments to lend additional amounts to customers with outstanding loans that are classified as TDRs, as compared to $ 1,100 at December 31, 2020.

There were no TDR loan modifications that occurred during the three months ended March 31, 2021 and 2020 that impacted provision expense or the allowance for loan losses.

The Company had no TDRs that occurred during the three months ended March 31, 2021 and 2020 that experienced any payment defaults within twelve months following their loan modification.

The Company had no specific allocations in reserves to customers whose loan terms have been modified in TDRs at June 30 , 2021 and December 31, 2020 .

At June 30 , 2021 , the Company had $ 3,263 in commitments to lend additional amounts to customers with outstanding loans that are classified as TDRs, as compared to $ 1,100 at December 31, 2020 .

NOTE 4 – LOANS AND ALLOWANCE FOR LOAN LOSSES (Continued)

There were no TDR loan modifications that occurred during the three and six months ended June 30, 2021 and 2020 that impacted provision expense or the allowance for loan losses.

During the three and six months ended June 30, 2021 and 2020, the Company had no TDRs that experienced any payment defaults within twelve months following their loan modification.

A default is considered to have occurred once the TDR is past due 90 days or more or it has been placed on nonaccrual.

TDR loans are returned to accrual status when all the principal and interest amounts contractually due are brought current and future payments are reasonably assured.

NOTE 4 – LOANS AND ALLOWANCE FOR LOAN LOSSES (Continued)

The Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) was signed into law on March 27, 2020 and provided guidance on the modification of loans as a result of COVID-19, which outlined, among other criteria, that short-term modifications made on a good faith basis to borrowers who were current as defined under the CARES Act prior to any relief, are not TDRs.

1 unchanged sentence

Borrowers are considered current if they are less than 30 days past due on their contractual payments at the time of modification.

As of March 31, 2021, the Company had modified 783 loans related to COVID-19 with an outstanding loan balance of $ 147,985 that were not reported as TDRs.

As of March 31, 2021, the Company had 56 modified loans that were still in active deferral related to COVID-19 with an outstanding loan balance of $ 2,395 that were not reported as TDRs in the tables presented above.

As of June 30, 2021, the Company had modified 709 loans related to COVID-19 with an outstanding loan balance of $ 133,993 that were not reported as TDRs.

As of June 30, 2021, the Company had 13 of these modified loans remaining that were related to COVID-19 with an outstanding loan balance of $ 183 that were not reported as TDRs in the tables presented above.

Credit Quality Indicators:

19 unchanged sentences

Collateral liquidation is considered likely to satisfy debt.

NOTE 4 – LOANS AND ALLOWANCE FOR LOAN LOSSES (Continued)

Loans classified as "doubtful" display a high probability of loss, although the amount of actual loss at the time of classification is undetermined.

This classification should be temporary until such time that actual loss can be identified, or improvements are made to reduce the seriousness of the classification.

This classification should be temporary until such time that actual loss can be identified, or improvements made to reduce the seriousness of the classification.

These loans exhibit all substandard characteristics with the addition that weaknesses make collection or liquidation in full highly questionable and improbable.

6 unchanged sentences

Amounts classified as loss should be promptly charged off.

NOTE 4 – LOANS AND ALLOWANCE FOR LOAN LOSSES (Continued)

Criticized and classified loans will mostly consist of commercial and industrial and commercial real estate loans.

1 unchanged sentence

All commercial loans are categorized into a risk category either at the time of origination or reevaluation date.

As of March 31, 2021 and December 31, 2020, and based on the most recent analysis performed, the risk category of commercial loans by class of loans was as follows:

March 31 , 2021

As of June 30, 2021 and December 31, 2020, and based on the most recent analysis performed, the risk category of commercial loans by class of loans was as follows:

June 30 , 2021

Commercial real estate:

9 unchanged sentences

The Company focuses mostly on the performance and repayment ability of the borrower as an indicator of credit risk and does not consider a borrower's credit score to be a significant influence in the determination of a loan's credit risk grading.

NOTE 4 – LOANS AND ALLOWANCE FOR LOAN LOSSES (Continued)

For residential and consumer loan classes, the Company evaluates credit quality based on the aging status of the loan, which was previously presented, and by payment activity.

The following table presents the recorded investment of residential and consumer loans by class of loans based on repayment activity as of March 31, 2021 and December 31, 2020:

March 31 , 2021

The following table presents the recorded investment of residential and consumer loans by class of loans based on repayment activity as of June 30, 2021 and December 31, 2020:

June 30 , 2021

Nonperforming

2 unchanged sentences

The Company originates residential, consumer, and commercial loans to customers located primarily in the southeastern areas of Ohio as well as the western counties of West Virginia.

Approximately 4.04 % of total loans were unsecured at March 31, 2021, down from 4.22 % at December 31, 2020.

Approximately 4.07 % of total loans were unsecured at June 30, 2021, down from 4.22 % at December 31, 2020.

NOTE 5 - FINANCIAL INSTRUMENTS WITH OFF-BALANCE SHEET RISK

3 unchanged sentences

The contract amounts of these instruments are not included in the consolidated financial statements.

At March 31, 2021, the contract amounts of these instruments totaled approximately $ 86,859 , compared to $ 88,456 at December 31, 2020.

At June 30, 2021, the contract amounts of these instruments totaled approximately $ 86,927 , compared to $ 88,456 at December 31, 2020.

The Bank uses the same credit policies in making commitments and conditional obligations as it does for instruments recorded on the balance sheet.

1 unchanged sentence

NOTE 6 - OTHER BORROWED FUNDS

Other borrowed funds at March 31, 2021 and December 31, 2020 are comprised of advances from the Federal Home Loan Bank (“FHLB”) of Cincinnati and promissory notes.

March 31, 2021

Other borrowed funds at June 30, 2021 and December 31, 2020 are comprised of advances from the Federal Home Loan Bank (“FHLB”) of Cincinnati and promissory notes.

FHLB Borrowings

Promissory Notes

June 30 , 2021

December 31, 2020

Pursuant to collateral agreements with the FHLB, advances were secured by $ 282,889 in qualifying mortgage loans, $ 55,701 in commercial loans and $ 5,365 in FHLB stock at March 31, 2021.

Fixed-rate FHLB advances of $ 23,493 mature through 2042 and have interest rates ranging from 1.53 % to 3.31 % and a year-to-date weighted average cost of 2.43 % at March 31, 2021 and 2.40 % at December 31, 2020.

There were no variable-rate FHLB borrowings at March 31, 2021.

At March 31, 2021, the Company had a cash management line of credit enabling it to borrow up to $ 100,000 from the FHLB.

Pursuant to collateral agreements with the FHLB, advances are secured by $ 274,680 in qualifying mortgage loans, $ 66,926 in commercial loans and $ 5,245 in FHLB stock at June 30, 2021.

Fixed-rate FHLB advances of $ 22,165 mature through 2042 and have interest rates ranging from 1.53 % to 3.31 % and a year-to-date weighted average cost of 2.42 % at June 30, 2021 and 2.40% at December 31, 2020.

There were no variable-rate FHLB borrowings at June 30, 2021.

NOTE 6 - OTHER BORROWED FUNDS (Continued)

At June 30, 2021, the Company had a cash management line of credit enabling it to borrow up to $ 100,000 from the FHLB.

All cash management advances have an original maturity of 90 days.

The line of credit must be renewed on an annual basis.

There was $ 92,178 available on this line of credit at March 31, 2021.

Based on the Company's current FHLB stock ownership, total assets and pledgeable loans, the Company had the ability to obtain borrowings from the FHLB up to a maximum of $ 188,666 at March 31, 2021.

There was $ 99,332 available on this line of credit at June 30, 2021.

Based on the Company's current FHLB stock ownership, total assets and pledgeable loans, the Company had the ability to obtain borrowings from the FHLB up to a maximum of $ 188,537 at June 30, 2021.

Of this maximum borrowing capacity, the Company had $ 99,332 available to use as additional borrowings.

Promissory notes, issued primarily by Ohio Valley, are due at various dates through a final maturity date of December 9, 2021 , and have fixed rates ranging from 1.00 % to 2.85 % and a year-to-date weighted average cost of 1.41 % at March 31, 2021, as compared to 2.20 % at December 31, 2020.

At March 31, 2021 and December 31, 2020, there were six promissory notes payable by Ohio Valley to related parties totaling $ 3,198 .

There were no promissory notes payable to other banks at March 31, 2021 and December 31, 2020, respectively.

Letters of credit issued on the Bank's behalf by the FHLB to collateralize certain public unit deposits as required by law totaled $ 72,995 at March 31, 2021 and $ 76,740 at December 31, 2020.

Scheduled principal payments as of March 31, 2021:

Promissory notes, issued primarily by Ohio Valley, are due at various dates through a final maturity date of April 13, 2022 , and have fixed rates of 1.00 % and a year-to-date weighted average cost of 1.33 % at June 30, 2021, as compared to 2.20 % at December 31, 2020.

At June 30, 2021 there were four promissory notes payable by Ohio Valley to related parties totaling $ 2,139 as compared to six totaling $ 3,198 at December 31, 2020.

There were no promissory notes payable to other banks at June 30, 2021 and December 31, 2020, respectively.

Letters of credit issued on the Bank's behalf by the FHLB to collateralize certain public unit deposits as required by law totaled $ 67,040 at June 30, 2021 and $ 76,740 at December 31, 2020.

Scheduled principal payments as of June 30, 2021:

NOTE 7 – SEGMENT INFORMATION

3 unchanged sentences

All Company segments are domestic.

Total revenues from the banking segment, which accounted for the majority of the Company's total revenues, totaled 90.8 % of total consolidated revenues for both quarters ended, March 31, 2021 and 2020.

Total revenues from the banking segment, which accounted for the majority of the Company's total revenues, totaled 93.1 % and 93.2 % of total consolidated revenues for the quarters end June 30, 2021 and 2020, respectively.

The accounting policies used for the Company's reportable segments are the same as those described in Note 1 - Summary of Significant Accounting Policies.

Income taxes are allocated based on income before tax expense.

NOTE 7 – SEGMENT INFORMATION (Continued)

Information for the Company’s reportable segments is as follows:

Three months ended March 31, 2021

Three Months Ended June 30, 2021

Net interest income

2 unchanged sentences

Noninterest expense

Three months ended March 31, 2020

Three Months Ended June 30, 2020

Net interest income

2 unchanged sentences

Noninterest expense

Six Months Ended June 30, 2021

Net interest income

Provision expense

Noninterest income

Noninterest expense

Six Months Ended June 30, 2020

Net interest income

Provision expense

Noninterest income

Noninterest expense

NOTE 8 – LEASES

8 unchanged sentences

Balance sheet information related to leases was as follows:

June 30, 2021

December 31, 2020

Operating leases:

3 unchanged sentences

Three Months Ended

Six Months Ended

Operating lease cost

Short-term lease expense

Future undiscounted lease payments for operating leases with initial terms of one year or more as of March 31, 2021 are as follows:

Future undiscounted lease payments for operating leases with initial terms of one year or more as of June 30, 2021 are as follows:

Operating Leases

2021 (remaining)

3 unchanged sentences

Other information was as follows:

June 30, 2021

December 31, 2020

Weighted-average remaining lease term for operating leases

1 unchanged sentence

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.

What changed 10-Q

Item 1. Financial Statements