0001275168-22-000006 | 10-Q | XBRL Viewer

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Cover - shares	3 Months Ended
Cover - shares	Mar. 31, 2022	May 06, 2022
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Mar. 31, 2022
Document Transition Report	false
Entity File Number	001-40379
Entity Registrant Name	FIVE STAR BANCORP
Entity Incorporation, State or Country Code	CA
Entity Tax Identification Number	75-3100966
Entity Address, Address Line One	3100 Zinfandel Drive
Entity Address, Address Line Two	Suite 100
Entity Address, City or Town	Rancho Cordova
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	95670
City Area Code	(916)
Local Phone Number	626-5000
Title of 12(b) Security	Common stock, no par value per share
Trading Symbol	FSBC
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	true
Entity Ex Transition Period	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		17,245,449
Entity Central Index Key	0001275168
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2022
Document Fiscal Period Focus	Q1
Amendment Flag	false

CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
ASSETS
Cash and due from financial institutions	$ 66,747	$ 136,074
Interest-bearing deposits in banks	438,217	289,255
Cash and cash equivalents	504,964	425,329
Time deposits in banks	14,464	14,464
Securities available-for-sale, at fair value	134,813	148,807
Securities held-to-maturity, at amortized cost (fair value of $4,459 and $5,197 at March 31, 2022 and December 31, 2021, respectively)	4,486	4,946
Loans held for sale	10,386	10,671
Loans held for investment	2,080,158	1,934,460
Allowance for loan losses	(23,904)	(23,243)
Loans held for investment, net of allowance for loan losses	2,056,254	1,911,217
Federal Home Loan Bank of San Francisco (“FHLB”) stock	6,667	6,723
Operating leases, right-of-use asset ("ROUA")	4,718	0
Premises and equipment, net	1,836	1,773
Bank-owned life insurance ("BOLI"), net	14,343	11,203
Interest receivable and other assets	25,318	21,628
Assets	2,778,249	2,556,761
Deposits
Non-interest-bearing	941,285	902,118
Interest-bearing	1,561,807	1,383,772
Total deposits	2,503,092	2,285,890
Subordinated notes, net	28,403	28,386
Operating lease liability	4,987	0
Interest payable and other liabilities	10,706	7,439
Total liabilities	2,547,188	2,321,715
Commitments and contingencies (Note 11)
Shareholders’ equity
Preferred stock, no par value; 10,000,000 shares authorized; zero issued and outstanding at March 31, 2022 and December 31, 2021	0	0
Common stock, no par value; 100,000,000 shares authorized; 17,246,199 shares issued and outstanding at March 31, 2022; 17,224,848 shares issued and outstanding at December 31, 2021	218,721	218,444
Retained earnings	19,558	17,168
Accumulated other comprehensive loss, net	(7,218)	(566)
Total shareholders’ equity	231,061	235,046
Liabilities and shareholders' equity	$ 2,778,249	$ 2,556,761

CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Statement of Financial Position [Abstract]
Securities held-to-maturity	$ 4,459	$ 5,197
Preferred stock (in USD per share)	$ 0	$ 0
Preferred stock, shares authorized (in shares)	10,000,000	10,000,000
Preferred stock, shares issued (in shares)	0	0
Preferred stock, shares outstanding (in shares)	0	0
Common Stock (in USD per share)	$ 0	$ 0
Common stock, shares authorized (in shares)	100,000,000	100,000,000
Common stock, shares issued (in shares)	17,246,199	17,224,848
Common stock, shares outstanding (in shares)	17,246,199	17,224,848

CONSOLIDATED STATEMENTS OF INCOME (Unaudited) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Interest and fee income
Loans, including fees	$ 22,091	$ 18,613
Taxable securities	390	259
Nontaxable securities	177	214
Interest-bearing deposits in other banks	192	104
Interest-bearing deposits in other banks	22,850	19,190
Interest expense
Deposits	545	699
Subordinated notes	443	443
Interest expense	988	1,142
Net interest income	21,862	18,048
Provision for loan losses	950	200
Net interest income after provision for loan losses	20,912	17,848
Non-interest income
Service charges on deposit accounts	108	90
Net gain on sale of securities available-for-sale	5	182
Gain on sale of loans	918	931
Loan-related fees	617	260
FHLB stock dividends	100	78
Earnings on BOLI	90	52
Other	345	23
Non-interest income, total	2,185	1,616
Non-interest expense
Salaries and employee benefits	5,675	4,697
Occupancy and equipment	520	451
Data processing and software	716	629
Federal Deposit Insurance Corporation ("FDIC") insurance	165	280
Professional services	554	1,532
Advertising and promotional	344	170
Loan-related expenses	278	229
Other operating expenses	1,323	816
Non-interest Expense, Total	9,575	8,804
Income before provision for income taxes	13,522	10,660
Provision for income taxes	3,660	382
Net income	$ 9,862	$ 10,278
Basic earnings per share (in USD per share)	$ 0.58	$ 0.93
Diluted earnings per share (in USD per share)	$ 0.58	$ 0.93

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Income Statement [Abstract]
Net income	$ 9,862	$ 10,278
Net unrealized holding loss on securities available-for-sale during the period	(9,438)	(1,614)
Reclassification adjustment for net realized gains included in net income	(5)	(185)
Income tax benefit related to other comprehensive loss	(2,791)	(64)
Other comprehensive loss	(6,652)	(1,735)
Total comprehensive income	$ 3,210	$ 8,543

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

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+ Details

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (Unaudited) - USD ($) $ in Thousands	Total	Employee	Director	Cumulative Effect, Period of Adoption, Adjustment	Common Stock	Common Stock Employee	Common Stock Director	Retained Earnings	Retained Earnings Cumulative Effect, Period of Adoption, Adjustment	Accumulated Other Comprehensive Income (Loss), Net of Taxes
Beginning balance at Dec. 31, 2020	$ 133,775				$ 110,082			$ 22,348		$ 1,345
Beginning balance (in shares) at Dec. 31, 2020					11,000,273
Net income	10,278							10,278
Other comprehensive loss	(1,735)									(1,735)
Stock compensation expense (non-director and director)		$ 62				$ 62
Stock issued under stock award plans	0
Stock issued under stock award plans (in shares)					9,454
Stock forfeitures	0
Stock forfeitures (in shares)					(2,722)
Cash dividends paid	(11,003)							(11,003)
Ending balance at Mar. 31, 2021	131,377				$ 110,144			21,623		(390)
Ending balance (in shares) at Mar. 31, 2021					11,007,005
Beginning balance at Dec. 31, 2020	$ 133,775				$ 110,082			22,348		1,345
Beginning balance (in shares) at Dec. 31, 2020					11,000,273
Accounting Standards Update [Extensible Enumeration]	Accounting Standards Update 2016-02
Ending balance at Dec. 31, 2021	$ 235,046			$ 68	$ 218,444			17,168	$ 68	(566)
Ending balance (in shares) at Dec. 31, 2021					17,224,848
Net income	9,862							9,862
Other comprehensive loss	(6,652)									(6,652)
Stock compensation expense (non-director and director)		$ 169	$ 108			$ 169	$ 108
Stock issued under stock award plans	0
Stock issued under stock award plans (in shares)					22,201
Stock forfeitures	0
Stock forfeitures (in shares)					(850)
Cash dividends paid	(7,540)							(7,540)
Ending balance at Mar. 31, 2022	$ 231,061				$ 218,721			$ 19,558		$ (7,218)
Ending balance (in shares) at Mar. 31, 2022					17,246,199

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (Unaudited) (Parenthetical) - $ / shares	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Statement of Stockholders' Equity [Abstract]
Cash dividends paid (in USD per share)	$ 0.60	$ 1.00

CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Cash flows from operating activities:
Net income	$ 9,862	$ 10,278
Adjustments to reconcile net income to net cash provided by operating activities:
Provision for loan losses	950	200
Loans originated for sale	(21,173)	(13,021)
Gain on sale of loans	(918)	(931)
Proceeds from sale of loans	11,705	10,892
Net gain on sale of securities available-for-sale	(5)	(182)
Earnings on BOLI	(90)	(52)
Stock compensation expense for employee and directors	300	100
Change in deferred loan fees	(365)	2,087
Amortization and accretion of security premiums and discounts	358	361
Amortization of subordinated notes issuance costs	17	16
Depreciation and amortization	161	131
Decrease in operating lease liability	(234)	0
Amortization of operating lease ROUA	250	0
Deferred taxes	(2,777)	0
Net changes in:
Interest receivable and other assets	1,880	(1,485)
Interest payable and other liabilities	3,588	245
Net cash provided by operating activities	3,486	8,601
Cash flows from investing activities:
Proceeds from sale of securities available-for-sale	1,623	11,456
Maturities, prepayments, and calls of securities available-for-sale	4,731	4,520
Purchases of securities available-for-sale	(1,642)	(28,761)
Increase in time deposits in banks	0	(1,991)
Loan originations, net of repayments	(134,951)	(37,719)
Purchase of premises and equipment	(224)	(113)
Purchase of BOLI	(3,050)	0
Net cash used in investing activities	(133,513)	(52,608)
Cash flows from financing activities:
Net change in deposits	217,202	199,109
Cash dividends paid	(7,540)	(11,003)
Net cash provided by financing activities	209,662	188,106
Net change in cash and cash equivalents	79,635	144,099
Cash and cash equivalents at beginning of period	425,329	290,493
Cash and cash equivalents at end of period	504,964	434,592
Supplemental disclosure of cash flow information:
Interest paid	932	1,170
Supplemental disclosure of noncash investing and financing activities:
Transfer from loans held for investment to loans held for sale	10,671	4,820
Unrealized (loss) gain on securities	(9,438)	1,797
Operating lease liabilities recorded in conjunction with adoption of ASC 842	5,221	0
ROUA recorded in conjunction with adoption of ASC 842	4,974	0
Cumulative effect of adoption of ASC 842 on retained earnings	19,558
Accounting Standards Update 2016-02 Cumulative Effect, Period of Adoption
Supplemental disclosure of noncash investing and financing activities:
Cumulative effect of adoption of ASC 842 on retained earnings	68	0
Employee
Adjustments to reconcile net income to net cash provided by operating activities:
Stock compensation expense for employee and directors	169	62
Director
Adjustments to reconcile net income to net cash provided by operating activities:
Stock compensation expense for employee and directors	$ 108	$ 0

Basis of Presentation

3 Months Ended

Mar. 31, 2022

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Basis of Presentation

Note 1: Basis of Presentation

Nature of Operations and Principles of Consolidation

Five Star Bank (the “Bank”) was chartered on October 26, 1999 and began operations on December 20, 1999. Five Star Bancorp (“Bancorp” or the “Company”) was incorporated on September 16, 2002 and subsequently obtained approval from the Federal Reserve to be a bank holding company in connection with its acquisition of the Bank. The Company became the sole shareholder of the Bank on June 2, 2003 in a statutory merger, pursuant to which each outstanding share of the Bank’s common stock was exchanged for one share of common stock of the Company.

The Company, through the Bank, provides financial services to customers who are predominately small and middle-market businesses, professionals, and individuals residing in the Northern California region. The Company's primary loan products are commercial real estate loans, land development loans, construction loans, and operating lines of credit, and its primary deposit products are checking accounts, savings accounts, money market accounts, and term certificate accounts. The Bank currently has seven branch offices in Roseville, Natomas, Rancho Cordova, Redding, Elk Grove, Chico, and Yuba City, and two loan production offices in Santa Rosa and Sacramento.

The Company terminated its status as a Subchapter S corporation as of May 5, 2021, in connection with the Company’s Initial Public Offering (“IPO”) and became a taxable C Corporation. Prior to that date, as an S Corporation, the Company had no U.S. federal income tax expense.

On April 9, 2021, the Company publicly filed a Registration Statement on Form S-1 with the SEC in connection with its IPO (the “Registration Statement”), which was subsequently amended on April 26, 2021 and May 3, 2021. The Registration Statement was declared effective by the SEC on May 4, 2021. In connection with the IPO, the Company issued 6,054,750 shares of common stock, no par value, which included 789,750 shares sold pursuant to the underwriters’ exercise of their option to purchase additional shares. The securities were sold to the public at a price of $20.00 per share and began trading on the Nasdaq Global Select Market on May 5, 2021. On May 7, 2021, the closing date of the IPO, the Company received total net proceeds of $111.2 million. The net proceeds less other related expenses, including audit fees, legal fees, listing fees, and other expenses, totaled $109.1 million.

Basis of Financial Statement Presentation and Consolidation

The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) as contained within the Financial Accounting Standards Board’s (“FASB”) Accounting Standards Codification (“ASC”) and the rules and regulations of the SEC, including the instructions to Regulation S-X. These interim unaudited consolidated financial statements reflect all adjustments (consisting solely of normal recurring adjustments and accruals) which, in the opinion of management, are necessary for a fair presentation of financial position, results of operations and comprehensive income, changes in shareholders’ equity, and cash flows for the interim periods presented. These unaudited consolidated financial statements have been prepared on a basis consistent with, and should be read in conjunction with, the audited consolidated financial statements as of and for the year ended December 31, 2021, and the notes thereto, as filed in the Company’s Annual Report on Form 10-K, which was filed with the SEC on February 25, 2022.

The unaudited consolidated financial statements include Five Star Bancorp and its wholly owned subsidiary, Five Star Bank. All significant intercompany transactions and balances are eliminated in consolidation.

The results of operations for the three months ended March 31, 2022 are not necessarily indicative of the results of operations that may be expected for any other interim period or for the year ending December 31, 2022.

While the Company’s chief decision-makers monitor the revenue streams of the various products and services, operations are managed, and financial performance is evaluated, on a Company-wide basis. Discrete financial information is not available other than on a Company-wide basis. Accordingly, all of the financial service operations are considered by management to be aggregated in one reportable operating segment.

The Company’s accounting and reporting policies conform to GAAP and to general practices within the banking industry.

The Company qualifies as an emerging growth company as defined in the Jumpstart Our Business Startups Act of 2012, and, as such, may take advantage of specified reduced reporting requirements and deferred accounting standards adoption dates, and is relieved of other significant requirements that are otherwise generally applicable to other public companies.

Use of Estimates

Management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. These estimates and assumptions affect the amounts reported in the unaudited consolidated financial statements and the disclosures provided, and actual results could differ. The allowance for loan losses is the most significant accounting estimate reflected in the Company’s consolidated financial statements.

Earnings Per Share (“EPS”)

Basic EPS is net income divided by the weighted average number of common shares outstanding during the period less average unvested restricted stock awards (“RSAs”). Diluted EPS includes the dilutive effect of additional potential common shares related to unvested RSAs using the treasury stock method. The Company has two forms of outstanding common stock: common stock and unvested RSAs. Holders of unvested RSAs receive non-forfeitable dividends at the same rate as common shareholders and they both share equally in undistributed earnings, and therefore the RSAs are considered participating securities. However, under the two-class method, the difference in EPS is not significant for these participating securities.


	Three months ended
(in thousands, except per share data)	March 31, 2022		March 31, 2021
Net income	$	9,862	$	10,278
Weighted average basic common shares outstanding	17,102,508		10,998,041
Add: Dilutive effects of assumed vesting of restricted stock	62,011		—
Weighted average diluted common shares outstanding	17,164,519		10,998,041
Income per common share:
Basic EPS	$	0.58	$	0.93
Diluted EPS	$	0.58	$	0.93

During the three months ended March 31, 2022 and 2021, there were no outstanding stock options. Anti-dilutive shares, which are excluded from the dilutive EPS calculation, were deemed to be immaterial.

For the three months ended March 31, 2021, pro forma EPS is calculated by applying a C Corporation effective tax rate of 29.56% to net income before provision for income taxes and using the determined pro forma net income balance to calculate EPS. For the three months ended March 31, 2022, pro forma EPS is actual EPS given that the Company was a C Corporation for the entire three-month period. The following reconciliation table provides a detailed calculation of pro forma EPS:


	Three months ended
(in thousands, except per share data)	March 31, 2022		March 31, 2021
Net income before provision for income taxes - GAAP	$	13,522	$	10,660
Less: Actual/pro forma provision for income taxes	3,660		3,151
Actual/pro forma net income	$	9,862	$	7,509

Weighted average basic common shares outstanding	17,102,508		10,998,041
Add: Dilutive effects of assumed vesting of restricted stock	62,011		—
Weighted average diluted common shares outstanding	17,164,519		10,998,041

Income per common share:
Basic EPS (actual/pro forma)	$	0.58	$	0.68
Diluted EPS (actual/pro forma)	$	0.58	$	0.68

Reclassifications

Certain amounts reported in previous consolidated financial statements have been reclassified to conform to current period presentation. These reclassifications did not affect previously reported amounts of net income, total assets, or total shareholders’ equity.

Recently Issued Accounting Standards	3 Months Ended
Recently Issued Accounting Standards	Mar. 31, 2022
Accounting Changes and Error Corrections [Abstract]
Recently Issued Accounting Standards	Note 2: Recently Issued Accounting Standards The following reflect recent accounting standards that are pending adoption by the Company. As discussed in Note 1, Basis of Presentation, the Company qualifies as an emerging growth company, and as such, has elected to use the extended transition period for complying with new or revised accounting standards and is not subject to the new or revised accounting standards applicable to public companies during the extended transition period. The accounting standards discussed below reflect effective dates for the Company as an emerging growth company with the extended transition period. Accounting Standards Adopted In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842). ASU 2016-02, which, among other things, requires lessees to recognize most leases on the balance sheet, thus increasing reported assets and liabilities. Lessor accounting remains substantially similar to historical GAAP. The FASB has issued incremental guidance to Topic 842 standard through ASU No. 2018-10, 2018-11, and 2021-05. The Company has elected to use the transition relief approach as provided in ASU 2018-11, which permits the Company to use January 1, 2022 as both the application date and the adoption date, rather than the modified retrospective approach. The Company also elected certain relief options offered within the new standard, which include the package of practical expedients, the option not to recognize an ROUA and lease liability that arise from short-term leases (i.e., leases with terms of 12 months or less), and the option of hindsight when determining lease term. Substantially all of the Company’s lease agreements are considered operating leases and were not previously recognized on the Company’s balance sheets. As of January 1, 2022, the Company recorded an ROUA and corresponding lease liability for all applicable operating leases. While the guidance increased the Company’s gross assets and liabilities, the adoption of ASU 2016-02 did not have a material impact on the consolidated statements of income or the consolidated statements of cash flows. See Note 11, Commitments and Contingencies, for more information. In August 2017, the FASB issued ASU No. 2017-12, Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities. The primary objective of the amendments in this update is to simplify the application of hedge accounting. More specifically, the amendments in this update better align an entity’s risk management activities and financial reporting for hedging relationships through changes to both the designation and measurement guidance for qualifying hedging relationships and the presentation of hedge results. Furthermore, the amendments expand and refine hedge accounting for both nonfinancial and financial risk components and align the recognition and presentation of the effects of the hedging instrument and the hedged item in the financial statements. Additionally, amendments in this update require an entity to present the earnings effect of the hedging instrument in the same income statement line item in which the earnings effect of the hedged item is reported. Hedge ineffectiveness is no longer separately measured and reported. The amendments in this update were effective for the Company beginning on January 1, 2022. The impact of adopting this ASU was immaterial to the Company’s consolidated financial statements. Accounting Standards Not Yet Adopted In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. The standard will replace the “incurred loss” model with a “current expected credit loss” (“CECL”) model. The CECL model will apply to estimated credit losses on loans receivable, held-to-maturity debt securities, unfunded loan commitments, and certain other financial assets measured at amortized cost. The CECL model is based on lifetime expected losses, rather than incurred losses, and requires the recognition of credit loss expense in the consolidated statement of income and a related allowance for credit losses on the consolidated statement of condition at the time of origination or purchase of a loan receivable or held-to-maturity debt security. Likewise, subsequent changes in this estimate are recorded through credit loss expense and related allowance. The CECL model requires the use of not only relevant historical experience and current conditions, but reasonable and supportable forecasts of future events and circumstances, incorporating a broad range of information in developing credit loss estimates, which could result in significant changes to both the timing and amount of credit loss expense and allowance. Under ASU 2016-13, available-for-sale debt securities are evaluated for impairment if fair value is less than amortized cost. Estimated credit losses are recorded through a credit loss expense and an allowance, rather than a write-down of the investment. Changes in fair value that are not credit-related will continue to be recorded in other comprehensive income. The ASU also expands the disclosure requirements regarding assumptions, models, and methods for estimating the allowance for loan losses. In addition, entities will need to disclose the amortized cost balance for each class of financial asset by credit quality indicator, disaggregated by the year of origination. In March 2022, the FASB issued ASU No. 2022-02, which eliminates the recognition and measurement guidance on troubled debt restructurings and requires enhanced disclosures about loan modifications for borrowers experiencing financial difficulties. ASU 2016-13, and subsequently, ASU 2022-02, are effective for the Company for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. Entities will apply a modified retrospective approach through a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is effective. While the Company believes the change from an incurred loss model to a CECL model has the potential to increase the allowance for loan losses at the adoption date, the Company cannot reasonably quantify the impact of the adoption of the amendments to its financial condition or results of operations at this time due to the complexity of and extensive changes resulting from these amendments. The Company is working with a third-party vendor to identify data gaps and determine the appropriate methodologies and resources to utilize in preparation for its transition to the new accounting standard, including but not limited to the use of certain tools to forecast future economic conditions that affect the cash flows of loans over their lifetime. In March 2020, the FASB issued ASU No. 2020-04, Reference Rate Reform (Topic 848). The amendments in this ASU are elective and provide optional guidance for a limited period of time to ease the potential burden in accounting for (or recognizing the effects of) reference rate reform. The amendments in this ASU provide optional expedients and exceptions for applying GAAP to contracts, hedging relationships, and other transactions that reference the London Inter-Bank Offered Rate (“LIBOR”) or another reference rate expected to be discontinued because of reference rate reform. Additionally, in January 2021, the FASB issued ASU No. 2021-01, Reference Rate Reform (Topic 848), which refines the scope of ASC 848 and clarifies its guidance, permitting entities to elect certain optional expedients and exceptions when accounting for derivative contracts and certain hedging relationships affected by changes in the interest rates used for discounting cash flows, computing variation margin settlements, and calculating price alignment interest in connection with reference rate reform activities under way in global financial markets. The amendments in these ASUs may be elected as of March 12, 2020 through December 31, 2022. An entity may choose to elect the amendments in these updates at an interim period subsequent to March 12, 2020, with adoption methods varying based on transaction type. The Company has not elected to apply these amendments; however, the Company is assessing the applicability of the ASUs and continues to monitor guidance for reference rate reform from FASB and its impact on the Company’s consolidated financial statements.

- Definition

The entire disclosure for change in accounting principle. Includes, but is not limited to, nature, reason, and method of adopting amendment to accounting standards or other change in accounting principle.

+ References

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+ Details

Fair Value of Assets and Liabilities

3 Months Ended

Mar. 31, 2022

Fair Value Disclosures [Abstract]

Fair Value of Assets and Liabilities

Fair Value Hierarchy and Fair Value Measurement

Accounting standards require the Company to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The standard describes three levels of inputs that may be used to measure fair value:

Level 1: Quoted prices (unadjusted) for identical assets or liabilities in active markets that the Company has the ability to access as of the measurement date.

Level 2: Significant other observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data.

Level 3: Significant unobservable inputs that reflect the Company’s own assumptions about the assumptions that market participants would use in pricing an asset or liability.

The fair values of securities are determined by obtaining quoted prices on nationally recognized securities exchanges (Level 1 inputs) or matrix pricing, which is a mathematical technique widely used in the industry to value debt securities without relying exclusively on quoted prices for the specific securities but rather by relying on the securities’ relationship to other benchmark quoted securities (Level 2 inputs).

The following table summarizes the Company’s assets and liabilities that were required to be recorded at fair value on a recurring basis.


(in thousands)	Carrying Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Measurement Categories: Changes in Fair Value Recorded In1
March 31, 2022
Assets:
Securities available-for-sale:
U.S. government agencies, mortgage-backed securities, obligations of states and political subdivisions, collateralized mortgage obligations, and corporate bonds	$	134,813	$	—	$	134,813	$	—	OCI
Derivatives – interest rate swap	58		—		58		—		NI
Liabilities:
Derivatives – interest rate swap	58		—		58		—		NI

December 31, 2021
Assets:
Securities available-for-sale:
U.S. government agencies, mortgage-backed securities, obligations of states and political subdivisions, collateralized mortgage obligations, and corporate bonds	$	148,807	$	—	$	148,807	$	—	OCI
Derivatives – interest rate swap	92		—		92		—		NI
Liabilities:
Derivatives – interest rate swap	92		—		92		—		NI

1Other comprehensive income (“OCI”) or net income (“NI”).

Available-for-sale securities are recorded at fair value on a recurring basis. When available, quoted market prices (Level 1) are used to determine the fair value of available-for-sale securities. If quoted market prices are not available, management obtains pricing information from a reputable third-party service provider, who may utilize valuation techniques that use current market-based or independently sourced parameters, such as bid/ask prices, dealer-quoted prices, interest rates, benchmark yield curves, prepayment speeds, probability of default, loss severity, and credit spreads (Level 2). Level 2 securities include U.S. agencies' or government-sponsored enterprises’ ("GSEs") debt securities, mortgage-backed securities, government agency issued bonds, privately issued collateralized mortgage obligations, and corporate bonds. As of March 31, 2022 and December 31, 2021, there were no Level 1 or Level 3 available-for-sale securities.

On a recurring basis, derivative financial instruments are recorded at fair value, which is based on the income approach using observable Level 2 market inputs, reflecting market expectations of future interest rates as of the measurement date. Standard valuation techniques are used to calculate the present value of the future expected cash flows assuming an orderly transaction. Valuation adjustments may be made to reflect both the Company’s credit risk and the counterparties’ credit risk in determining the fair value of the derivatives. A similar credit risk adjustment, correlated to the credit standing of the counterparty, is made when collateral posted by the counterparty does not fully cover their liability to the Company.

Certain financial assets may be measured at fair value on a non-recurring basis. These assets are subject to fair value adjustments that result from the application of the lower of cost or fair value accounting or write-downs of individual assets, such as collateral dependent impaired loans and other real estate owned (“OREO”). As of March 31, 2022 and December 31, 2021, the Company did not carry any assets measured at fair value on a non-recurring basis.

Disclosures about Fair Value of Financial Instruments

The table below is a summary of fair value estimates for financial instruments as of March 31, 2022 and December 31, 2021. The carrying amounts in the following table are recorded in the consolidated balance sheets under the indicated captions. Further, management has not disclosed the fair value of financial instruments specifically excluded from disclosure requirements, such as BOLI.


	March 31, 2022					December 31, 2021
(in thousands)	Carrying Amounts		Fair Value		Fair Value Hierarchy	Carrying Amounts		Fair Value		Fair Value Hierarchy
Financial assets:
Cash and cash equivalents	$	504,964	$	504,964	Level 1	$	425,329	$	425,329	Level 1
Time deposits in banks	14,464		14,464		Level 1	14,464		14,464		Level 1
Securities available-for-sale	134,813		134,813		Level 2	148,807		148,807		Level 2
Securities held-to-maturity	4,486		4,459		Level 3	4,946		5,197		Level 3
Loans held for sale	10,386		11,063		Level 2	10,671		11,217		Level 2
Loans held for investment, net of allowance for loan losses	2,056,254		1,993,626		Level 3	1,911,217		1,893,431		Level 3
FHLB stock and other investments	12,383		N/A		N/A	12,464		N/A		N/A
Interest receivable	5,547		5,547		Level 2	5,332		5,332		Level 2
Interest rate swap	58		58		Level 2	92		92		Level 2
Financial liabilities:
Deposits	2,503,092		2,349,536		Level 2	2,285,890		2,210,555		Level 2
Interest payable	79		79		Level 2	23		23		Level 2
Interest rate swap	58		58		Level 2	92		92		Level 2
Subordinated notes	28,403		28,403		Level 3	28,386		28,386		Level 3

The following methods and assumptions were used by the Company to estimate the fair value of its financial instruments at March 31, 2022 and December 31, 2021:

Cash and cash equivalents and time deposits in banks: The carrying amount is estimated to be fair value due to the liquid nature of the assets and their short-term maturities.

Investment securities: See discussion above for the methods and assumptions used by the Company to estimate the fair value of investment securities.

Loans held for sale: For loans held for sale, the fair value is based on what secondary markets are currently offering for portfolios with similar characteristics.

Loans held for investment: For variable rate loans that reprice frequently with no significant change in credit risk, fair values are based on carrying values. Fair values for other loans are estimated using discounted cash flow analyses, which use interest rates being offered at each reporting date for loans with similar terms to borrowers of comparable creditworthiness without considering widening credit spreads due to market illiquidity, which approximates the exit price notion. The allowance for loan losses is considered to be a reasonable estimate of loan discount for credit quality concerns.

Interest receivable and payable: For interest receivable and payable, the carrying amount is estimated to be fair value.

Derivatives - interest rate swap: See above for a discussion of the methods and assumptions used by the Company to estimate the fair value of derivatives.

Deposits: The fair values for demand deposits are, by definition, equal to the amount payable on demand at the reporting date represented by their carrying amount. Fair values for fixed rate certificates of deposit are estimated using a discounted cash flow analysis that uses interest rates being offered at each reporting date by the Company for certificates with similar remaining maturities. For variable rate time deposits, cost approximates fair value.

Subordinated Notes: The fair value is estimated by discounting the future cash flow using the current three-month LIBOR. The Company's subordinated notes are not registered securities and were issued through private placements, resulting in a Level 3 classification. The notes are recorded at carrying value.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details

Investment Securities

3 Months Ended

Mar. 31, 2022

Investments, Debt and Equity Securities [Abstract]

Investment Securities

The Company’s investment securities portfolio includes obligations of states and political subdivisions, securities issued by U.S. federal government agencies such as the Small Business Administration (the “SBA”), and securities issued by U.S. GSEs, such as the Federal National Mortgage Association (the “FNMA”), the Federal Home Loan Mortgage Corporation (the “FHLMC”), and the FHLB. The Company also invests in residential and commercial mortgage-backed securities, collateralized mortgage obligations issued or guaranteed by the GSEs, and corporate bonds, as reflected in the following tables.

A summary of the amortized cost and fair value related to securities held-to-maturity as of March 31, 2022 and December 31, 2021 is presented below.


(in thousands)			Gross Unrealized
	Amortized Cost		Gains		(Losses)		Fair Value
March 31, 2022
Obligations of states and political subdivisions	$	4,486	$	—	$	(27)	$	4,459
Total held-to-maturity	$	4,486	$	—	$	(27)	$	4,459
December 31, 2021
Obligations of states and political subdivisions	$	4,946	$	251	$	—	$	5,197
Total held-to-maturity	$	4,946	$	251	$	—	$	5,197

For securities issued by states and political subdivisions, management considers: (i) issuer and/or guarantor credit ratings, (ii) historical probability of default and loss given default rates for given bond ratings and remaining maturity, (iii) whether issuers continue to make timely principal and interest payments under the contractual terms of the securities, (iv) internal credit review of the financial information; and (v) whether or not such securities have credit enhancements such as guarantees, contain a defeasance clause, or are pre-refunded by the issuers.

A summary of the amortized cost and fair value related to securities available-for-sale as of March 31, 2022 and December 31, 2021 is presented below.


(in thousands)	Amortized Cost		Gross Unrealized				Fair Value
			Gains		(Losses)
March 31, 2022
U.S. government agencies	$	18,241	$	95	$	(257)	$	18,079
Mortgage-backed securities	79,694		8		(6,210)		73,492
Obligations of states and political subdivisions	44,621		23		(3,713)		40,931
Collateralized mortgage obligations	504		—		(21)		483
Corporate bonds	2,000		—		(172)		1,828
Total available-for-sale	$	145,060	$	126	$	(10,373)	$	134,813
December 31, 2021
U.S. government agencies	$	19,824	$	60	$	(202)	$	19,682
Mortgage-backed securities	82,517		94		(1,098)		81,513
Obligations of states and political subdivisions	44,732		525		(120)		45,137
Collateralized mortgage obligations	537		3		—		540
Corporate bonds	2,000		—		(65)		1,935
Total available-for-sale	$	149,610	$	682	$	(1,485)	$	148,807

The amortized cost and fair value of investment debt securities by contractual maturity at March 31, 2022 and December 31, 2021 are shown below. Expected maturities may differ from contractual maturities if the issuers of the securities have the right to call or prepay obligations with or without call or prepayment penalties.


(in thousands)	March 31, 2022								December 31, 2021
	Held-to-Maturity				Available-for-Sale				Held-to-Maturity				Available-for-Sale
	Amortized Cost		Fair Value		Amortized Cost		Fair Value		Amortized Cost		Fair Value		Amortized Cost		Fair Value
Within one year	$	456	$	454	$	—	$	—	$	491	$	516	$	—	$	—
After one but within five years	1,115		1,108		505		514		951		999		507		522
After five years through ten years	1,590		1,580		3,684		3,458		3,504		3,682		3,697		3,748
After ten years	1,325		1,317		40,432		36,959		—		—		40,528		40,867

Investment securities not due at a single maturity date:
U.S. government agencies	—		—		18,241		18,079		—		—		19,824		19,682
Mortgage-backed securities	—		—		79,694		73,492		—		—		82,517		81,513
Collateralized mortgage obligations	—		—		504		483		—		—		537		540
Corporate bonds	—		—		2,000		1,828		—		—		2,000		1,935
Total	$	4,486	$	4,459	$	145,060	$	134,813	$	4,946	$	5,197	$	149,610	$	148,807

Sales of investment securities and gross gains and losses are shown in the following table:


(in thousands)	For the three months ended
	March 31, 2022		March 31, 2021
Available-for-sale:
Sales proceeds	$	1,623	$	11,456
Gross realized gains	5		182

Pledged investment securities are shown in the following table:


(in thousands)	March 31, 2022		December 31, 2021
Pledged to the State of California:
Secure deposits of public funds and borrowings	$	57,423	$	63,363
Total pledged investment securities	$	57,423	$	63,363

The following table details the gross unrealized losses and fair values aggregated by investment category and length of time that individual available-for-sale securities have been in a continuous unrealized loss position at March 31, 2022 and December 31, 2021:


(in thousands)	< 12 continuous months				≥ 12 continuous months				Total securities in a loss position
	Fair Value		Unrealized Loss		Fair Value		Unrealized Loss		Fair Value		Unrealized Loss
March 31, 2022
U.S. government agencies	$	2,275	$	(77)	$	12,371	$	(180)	$	14,646	$	(257)
Mortgage-backed securities	62,090		(5,122)		10,969		(1,088)		73,059		(6,210)
Obligations of states and political subdivisions	37,803		(3,540)		1,791		(173)		39,594		(3,713)
Collateralized mortgaged obligations	483		(21)		—		—		483		(21)
Corporate bonds	1,828		(172)		—		—		1,828		(172)
Total temporarily impaired securities	$	104,479	$	(8,932)	$	25,131	$	(1,441)	$	129,610	$	(10,373)

December 31, 2021
U.S. government agencies	$	—	$	—	$	13,399	$	(202)	$	13,399	$	(202)
Mortgage-backed securities	73,972		(1,046)		1,400		(52)		75,372		(1,098)
Obligations of states and political subdivisions	14,014		(112)		407		(8)		14,421		(120)
Corporate bonds	1,935		(65)		—		—		1,935		(65)
Total temporarily impaired securities	$	89,921	$	(1,223)	$	15,206	$	(262)	$	105,127	$	(1,485)

There were 150 and 91 available-for-sale securities in unrealized loss positions at March 31, 2022 and December 31, 2021, respectively. As of March 31, 2022, the investment portfolio included 24 investment securities that had been in a continuous loss position for twelve months or more and 126 investment securities that had been in a loss position for less than twelve months.

The Company periodically evaluates each available-for-sale investment security in an unrealized loss position to determine if the impairment is temporary or other than temporary and has determined that no investment security is other than temporarily impaired. The unrealized losses are due primarily to interest rate changes. The Company does not intend, and it is more likely than not that the Company will not be required, to sell the securities before the earlier of the forecasted recovery or the maturity of the underlying debt security.

There was one held-to-maturity security in a continuous unrealized loss position at March 31, 2022. This security was in an unrealized loss position for less than 12 months. There were no held-to-maturity securities in a continuous loss position at December 31, 2021.

Obligations issued or guaranteed by government agencies such as GNMA and SBA or GSEs under conservatorship such as FNMA and FHLMC are guaranteed or sponsored by agencies of the U.S. government and have strong credit profiles. The Company therefore expects to receive all contractual interest payments on time and believes the risk of credit losses on these securities is remote.

The Company’s investment in obligations of states and political subdivisions are deemed credit worthy after management’s comprehensive analysis of the issuers’ latest financial information, credit ratings by major credit agencies, and/or credit enhancements.

Non-Marketable Securities Included in Other Assets

FHLB capital stock: As a member of the FHLB, the Company is required to maintain a minimum investment in FHLB capital stock determined by the board of directors of the FHLB. The minimum investment requirements can increase in the event the Company increases its total asset size or borrowings with the FHLB. Shares cannot be purchased or sold except between the FHLB and its members at the $100 per share par value. The Company held $6.7 million of FHLB stock at March 31, 2022 and December 31, 2021. The carrying amounts of these investments are reasonable estimates of fair value because the securities are restricted to member banks and do not have a readily determinable market value. Based on management’s analysis of the FHLB’s financial condition and certain qualitative factors, management determined that the FHLB stock was not impaired at March 31, 2022 and December 31, 2021. On February 16, 2022, FHLB announced a cash dividend for the fourth quarter of 2021 at an annualized dividend rate of 6.00%, which was paid on March 10, 2022. For the three months ended March 31, 2022 and 2021, cash dividends received on FHLB capital stock in the amount of $0.1 million were recorded as non-interest income on the consolidated statements of income.

Loans and Allowance for Loan Losses

3 Months Ended

Mar. 31, 2022

Receivables [Abstract]

Loans and Allowance for Loan Losses

Loans and Allowance for Loan LossesThe Company’s loan portfolio is its largest class of earning assets and typically provides higher yields than other types of earning assets. Associated with the higher yields is an inherent amount of credit risk which the Company attempts to mitigate with strong underwriting. As of March 31, 2022 and December 31, 2021, the carrying value of total loans held for investment amounted to $2.1 billion and $1.9 billion, respectively. The following table presents the balance of each major product type within the Company’s portfolio as of the dates indicated.


(in thousands)	March 31, 2022		December 31, 2021
Real estate:
Commercial	$	1,760,551	$	1,586,232
Commercial land and development	9,090		7,376
Commercial construction	59,293		54,214
Residential construction	5,540		7,388
Residential	28,921		28,562
Farmland	49,903		54,805
Commercial:
Secured	124,930		137,062
Unsecured	22,599		21,136
Paycheck Protection Program (“PPP”)	1,528		22,124
Consumer and other	19,044		17,167
Subtotal	2,081,399		1,936,066
Less: Net deferred loan fees	1,241		1,606
Less: Allowance for loan losses	23,904		23,243
Loans held for investment, net of allowance for loan losses	$	2,056,254	$	1,911,217

Underwriting

Commercial loans: Commercial loans are underwritten after evaluating and understanding the borrower’s ability to operate profitably and prudently expand its business. Underwriting standards are designed to promote relationship banking rather than transactional banking. Once it is determined that the borrower’s management possesses sound ethics and solid business acumen, the Company’s management examines current and projected cash flows to determine the ability of the borrower to repay its obligations as agreed. Commercial loans are primarily made based on the identified cash flows of the borrower and secondarily on the underlying collateral provided by the borrower. The cash flows of borrowers, however, may not be as expected, and the collateral securing these loans may fluctuate in value. Most commercial loans are secured by the assets being financed or other business assets such as accounts receivable or inventory and may incorporate a personal guarantee; however, some short-term loans may be made on an unsecured basis. In the case of loans secured by accounts receivable, the availability of funds for the repayment of these loans may be substantially dependent on the ability of the borrower to collect amounts due from its customers.

Real estate loans: Real estate loans are subject to underwriting standards and processes similar to commercial loans. These loans are viewed primarily as cash flow loans and secondarily as loans secured by real estate. Commercial real estate lending typically involves higher loan principal amounts, and the repayment of these loans is generally largely dependent on the successful operation of the property securing the loan or the business conducted on the property securing the loan. Commercial real estate loans may be more adversely affected than other loans by conditions in the real estate market or in the general economy. The properties securing the Company’s commercial real estate portfolio are diverse in terms of type. This diversity helps reduce the Company’s exposure to adverse economic events that affect any single market or industry. Management monitors and evaluates commercial real estate loans based on collateral, geography, and risk grade criteria.

Construction loans: With respect to construction loans that the Company may originate from time to time, the Company generally requires the borrower to have had an existing relationship with the Company and have a proven record of success. Construction loans are underwritten utilizing feasibility studies, independent appraisal reviews, sensitivity analysis of absorption and lease rates, and financial analysis of the developers and property owners. Construction loans are generally based upon estimates of costs and value associated with the complete project. These estimates may be inaccurate. Construction loans often involve the disbursement of substantial funds with repayment substantially dependent on the ultimate success of the project. Sources of repayment for these types of loans may be pre-committed permanent loans from approved long-term lenders, sales of developed property, or an interim loan commitment from the Company until permanent financing is obtained. These loans are closely monitored by on-site inspections and are generally considered to have higher risks than other real estate loans due to their ultimate repayment being sensitive to interest rate changes, governmental regulation of real property, general economic conditions, and the availability of long-term financing.

Residential real estate loans: Residential real estate loans are underwritten based upon the borrower’s income, credit history, and collateral. To monitor and manage residential loan risk, policies and procedures are developed and modified, as needed. This activity, coupled with relatively small loan amounts that are spread across many individual borrowers, minimizes risk. Underwriting standards for home loans are heavily influenced by statutory requirements, which include, but are not limited to, a maximum loan-to-value percentage, collection remedies, the number of such loans a borrower can have at one time, and documentation requirements.

Farmland loans: Farmland loans are generally made to producers and processors of crops and livestock. Repayment is primarily from the sale of an agricultural product or service. Farmland loans are secured by real property and are susceptible to changes in market demand for specific commodities. This may be exacerbated by, among other things, industry changes, changes in the individual financial capacity of the business owner, general economic conditions, and changes in business cycles, as well as adverse weather conditions.

Consumer loans: The Company purchased consumer loans underwritten utilizing credit scoring analysis to supplement the underwriting process. To monitor and manage consumer loan risk, policies and procedures are developed and modified, as needed. This activity, coupled with relatively small loan amounts that are spread across many individual borrowers, minimizes risk. Underwriting standards for home equity loans are heavily influenced by statutory requirements, which include, but are not limited to, a maximum loan-to-value percentage, collection remedies, the number of such loans a borrower can have at one time, and documentation requirements.

Credit Quality Indicators

The Company has established a loan risk rating system to measure and monitor the quality of the loan portfolio. All loans are assigned a risk rating from the inception of the loan until the loan is paid off. The primary loan grades are as follows:

Loans rated pass: These are loans to borrowers with satisfactory financial support, repayment capacity, and credit strength. Borrowers in this category demonstrate fundamentally sound financial positions, repayment capacity, credit history, and management expertise. Loans in this category must have an identifiable and stable source of repayment and meet the Company’s policy regarding debt service coverage ratios. These borrowers are capable of sustaining normal economic, market, or operational setbacks without significant financial impacts. Financial ratios and trends are acceptable. Negative external industry factors are generally not present. The loan may be secured, unsecured, or supported by non-real estate collateral for which the value is more difficult to determine and/or marketability is more uncertain.

Loans rated watch: These are loans which have deficient loan quality and potentially significant issues, but losses do not appear to be imminent, and the issues are expected to be temporary in nature. The significant issues are typically: (i) a history of losses or events that threaten the borrower’s viability; (ii) a property with significant depreciation and/or marketability concerns; or (iii) poor or deteriorating credit, occasional late payments, and/or limited reserves but loan is generally kept current. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the asset or in the Company’s credit position at some future date.

Loans rated substandard: These are loans which are inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged (if any). Loans so classified exhibit a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. Loans are characterized by the distinct possibility that the Company may sustain some loss if the deficiencies are not corrected. The substandard loan category includes loans that management has determined not to be impaired, as well as loans that are impaired.

Loans rated doubtful: These are loans for which the collection or liquidation of the entire debt is highly questionable or improbable. Typically, the possibility of loss is extremely high. The losses on these loans are deferred until all pending factors have been addressed.

The following table summarizes the credit quality indicators related to the Company’s loans by class as of March 31, 2022:


(in thousands)	Pass		Watch		Substandard		Doubtful		Total
Real estate:
Commercial	$	1,751,563	$	8,087	$	901	$	—	$	1,760,551
Commercial land and development	9,090		—		—		—		9,090
Commercial construction	53,393		5,900		—		—		59,293
Residential construction	5,540		—		—		—		5,540
Residential	28,744		—		177		—		28,921
Farmland	49,903		—		—		—		49,903
Commercial:
Secured	122,996		14		1,920		—		124,930
Unsecured	22,599		—		—		—		22,599
PPP	1,528		—		—		—		1,528
Consumer	19,032		—		12		—		19,044
Total	$	2,064,388	$	14,001	$	3,010	$	—	$	2,081,399

The following table summarizes the credit quality indicators related to the Company’s loans by class as of December 31, 2021:


(in thousands)	Pass		Watch		Substandard		Doubtful		Total
Real estate:
Commercial	$	1,575,006	$	1,970	$	9,256	$	—	$	1,586,232
Commercial land and development	7,376		—		—		—		7,376
Commercial construction	48,288		5,926		—		—		54,214
Residential construction	7,388		—		—		—		7,388
Residential	28,384		—		178		—		28,562
Farmland	54,805		—		—		—		54,805
Commercial:
Secured	135,131		751		1,180		—		137,062
Unsecured	21,136		—		—		—		21,136
PPP	22,124		—		—		—		22,124
Consumer	17,167		—		—		—		17,167
Total	$	1,916,805	$	8,647	$	10,614	$	—	$	1,936,066

Management regularly reviews the Company’s loans for accuracy of risk grades whenever new information is received. Borrowers are generally required to submit financial information at regular intervals. Typically, commercial borrowers with lines of credit are required to submit financial information with reporting intervals ranging from monthly to annually depending on credit size, risk, and complexity. In addition, investor commercial real estate borrowers with loans exceeding a certain dollar threshold are usually required to submit rent rolls or property income statements annually. Management monitors construction loans monthly and reviews other consumer loans based on delinquency. Management also reviews loans graded “watch” or worse, regardless of loan type, no less than quarterly.

The age analysis of past due loans by class as of March 31, 2022 consisted of the following:


(in thousands)	Past Due
	30-89 Days		Greater Than 90 Days		Total Past Due		Current		Total Loans Receivable
Real estate:
Commercial	$	—	$	—	$	—	$	1,760,551	$	1,760,551
Commercial land and development	—		—		—		9,090		9,090
Commercial construction	—		—		—		59,293		59,293
Residential construction	—		—		—		5,540		5,540
Residential	—		—		—		28,921		28,921
Farmland	—		—		—		49,903		49,903
Commercial:
Secured	422		—		422		124,508		124,930
Unsecured	—		—		—		22,599		22,599
PPP	—		—		—		1,528		1,528
Consumer and other	127		—		127		18,917		19,044
Total	$	549	$	—	$	549	$	2,080,850	$	2,081,399

There were no loans between 60-89 days past due nor any loans greater than 90 days past due and still accruing as of March 31, 2022.

The age analysis of past due loans by class as of December 31, 2021 consisted of the following:


(in thousands)	Past Due				Total Past Due		Current		Total Loans Receivable
	30-89 Days		Greater Than 90 Days
Real estate:
Commercial	$	—	$	—	$	—	$	1,586,232	$	1,586,232
Commercial land and development	—		—		—		7,376		7,376
Commercial construction	—		—		—		54,214		54,214
Residential construction	—		—		—		7,388		7,388
Residential	—		—		—		28,562		28,562
Farmland	—		—		—		54,805		54,805
Commercial:
Secured	—		—		—		137,062		137,062
Unsecured	—		—		—		21,136		21,136
PPP	—		—		—		22,124		22,124
Consumer and other	334		—		334		16,833		17,167
Total	$	334	$	—	$	334	$	1,935,732	$	1,936,066

There were no loans between 60-89 days past due nor any loans greater than 90 days past due and still accruing as of December 31, 2021.

Impaired Loans

Information related to impaired loans as of March 31, 2022 and December 31, 2021 consisted of the following:


	March 31, 2022						December 31, 2021
(in thousands)	Recorded Investment		Unpaid Principal Balance		Related Allowance		Recorded Investment		Unpaid Principal Balance		Related Allowance
With no related allowance recorded:
Real estate:
Commercial	$	118	$	118	$	—	$	122	$	122	$	—
Residential	177		177		—		178		178		—
Commercial:
Secured	111		111		—		116		116		—
Consumer and other	12		12		—		—		—		—
	$	418	$	418	$	—	$	416	$	416	$	—

With an allowance recorded:
Commercial:
Secured	$	922	$	922	$	639	$	172	$	172	$	172
	$	922	$	922	$	639	$	172	$	172	$	172

Total by category:
Real estate:
Commercial	$	118	$	118	$	—	$	122	$	122	$	—
Residential	177		177		—		178		178		—
Commercial:
Secured	1,033		1,033		639		288		288		172
Consumer and other	12		12		—		—		—		—
Total impaired loans	$	1,340	$	1,340	$	639	$	588	$	588	$	172

No collateral dependent loans were in process of foreclosure at March 31, 2022 or December 31, 2021.

Information related to impaired loans for the three months ended March 31, 2022 and 2021 consisted of the following:


	Three months ended
	March 31, 2022				March 31, 2021
(in thousands)	Average Recorded Investment		Interest Income Recognized			Average Recorded Investment		Interest Income Recognized
With no related allowance recorded:
Real estate:
Commercial	$	120	$	—		$	136	$	—
Residential	178		—			182		—
Commercial:
Secured	174		—			129		—
Consumer and other	25		—			—		—
	$	497	$	—		$	447	$	—

With an allowance recorded:
Commercial:
Secured	$	947	$	—		$	—	$	—
Consumer and other	—		—			36		—
	$	947	$	—		$	36	$	—

Total by category:
Real estate:
Commercial	$	120	$	—		$	136	$	—
Residential	178		—			182		—
Commercial:
Secured	1,121		—			129		—
Consumer and other	25		—			36		—
Total impaired loans	$	1,444	$	—		$	483	$	—

Non-accrual loans, segregated by class, are as follows as of March 31, 2022 and December 31, 2021:


(in thousands)	March 31, 2022		December 31, 2021
Real estate:
Commercial	$	118	$	122
Residential	177		178
Commercial:
Secured	1,033		288
Total non-accrual loans	$	1,328	$	588

The amount of foregone interest income related to non-accrual loans was $18.3 thousand and $6.8 thousand for the three months ended March 31, 2022 and 2021, respectively.

Troubled Debt Restructuring

The Company’s loan portfolio may include certain loans that have been modified in a troubled debt restructuring (“TDR”), which are loans for which concessions in terms have been granted because of the borrowers’ financial difficulties. These concessions typically result from the Company’s loss mitigation activities and could include reductions in the interest rate, payment extensions, forgiveness of principal, forbearance, or other actions. Certain TDRs are placed on non-accrual status at the time of restructure and may only be returned to accruing status after considering the borrower’s sustained repayment performance for a reasonable period, generally six months.

When a loan is modified, it is measured based upon the present value of future cash flows discounted at the effective interest rate of the original loan agreement or the fair value of collateral less selling costs if the loan is collateral dependent. If the value of the modified loan is less than the recorded investment in the loan, impairment is recognized through a specific allowance or a charge-off of the loan.

There were no loans outstanding with a TDR designation at March 31, 2022 or December 31, 2021.

Section 4013 of the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”), as subsequently amended by the Consolidated Appropriations Act, 2021, provided TDR relief for borrowers affected by the COVID-19 pandemic. Specifically, the CARES Act, as amended, specified that to be eligible not to be considered a TDR, a loan modification must be (i) related to the COVID-19 pandemic; (ii) executed on a loan that was not more than 30 days past due as of December 31, 2020; and (iii) executed between March 1, 2020, and the earlier of (a) 60 days after the date of termination of the federal national emergency; or (b) January 1, 2022. In accordance with section 4013 of the CARES Act, the Company elected to apply the temporary accounting relief provisions for loan modifications that met certain criteria, which would otherwise be designated TDRs under existing GAAP. As of March 31, 2022 and December 31, 2021, six borrowing relationships with six loans totaling $12.2 million were continuing to benefit from payment relief. The Company accrues and recognizes interest income on loans under payment relief based on the original contractual interest rates. When payments resume at the end of the relief period, the payments will generally be applied to accrued interest due until accrued interest is fully paid.

The following table discloses activity in the allowance for loan losses for the periods presented.


	Real Estate												Commercial
(in thousands)	Comml		Comml Land and Devel		Comml Const		Resid Const		Resid		Farm- land		Secured		Unsec		PPP		Consu		Unal		Total
Three months ended March 31, 2022
Beginning balance	$	12,869	$	50	$	371	$	50	$	192	$	645	$	6,859	$	207	$	—	$	889	$	1,111	$	23,243
Charge-offs	—		—		—		—		—		—		(309)		—		—		(67)		—		(376)
Recoveries	—		—		—		—		—		—		46		—		—		41		—		87
Provision (recapture)	999		16		59		(10)		16		(34)		443		39		—		225		(803)		950
Ending balance	$	13,868	$	66	$	430	$	40	$	208	$	611	$	7,039	$	246	$	—	$	1,088	$	308	$	23,904
Three months ended March 31, 2021
Beginning balance	$	9,358	$	77	$	821	$	87	$	220	$	615	$	9,476	$	179	$	—	$	632	$	724	$	22,189
Charge-offs	—		—		—		—		—		—		(255)		—		—		—		—		(255)
Recoveries	—		—		—		—		—		—		87		—		—		50		—		137
Provision (recapture)	861		3		(317)		(30)		(32)		(37)		(390)		16		—		(82)		208		200
Ending balance	$	10,219	$	80	$	504	$	57	$	188	$	578	$	8,918	$	195	$	—	$	600	$	932	$	22,271

The following table summarizes the allocation of the allowance for loan losses by impairment methodology for the periods presented.


	Real Estate												Commercial
(in thousands)	Comml		Comml Land and Devel		Comml Const		Resid Const		Resid		Farm- land		Secured		Unsec		PPP		Consu		Unal		Total
As of March 31, 2022:
Ending allowance balance allocated to:
Loans individually evaluated for impairment	$	—	$	—	$	—	$	—	$	—	$	—	$	639	$	—	$	—	$	—	$	—	$	639
Loans collectively evaluated for impairment	13,868		66		430		40		208		611		6,400		246		—		1,088		308		23,265
Ending balance	$	13,868	$	66	$	430	$	40	$	208	$	611	$	7,039	$	246	$	—	$	1,088	$	308	$	23,904
Loans:
Ending balance individually evaluated for impairment	$	118	$	—	$	—	$	—	$	177	$	—	$	1,034	$	—	$	—	$	12	$	—	$	1,341
Ending balance collectively evaluated for impairment	1,760,433		9,090		59,293		5,540		28,744		49,903		123,896		22,599		1,528		19,032		—		2,080,058
Ending balance	$	1,760,551	$	9,090	$	59,293	$	5,540	$	28,921	$	49,903	$	124,930	$	22,599	$	1,528	$	19,044	$	—	$	2,081,399

As of December 31, 2021:
Ending allowance balance allocated to:
Loans individually evaluated for impairment	$	—	$	—	$	—	$	—	$	—	$	—	$	172	$	—	$	—	$	—	$	—	$	172
Loans collectively evaluated for impairment	12,869		50		371		50		192		645		6,687		207		—		889		1,111		23,071
Ending balance	$	12,869	$	50	$	371	$	50	$	192	$	645	$	6,859	$	207	$	—	$	889	$	1,111	$	23,243
Loans:
Ending balance individually evaluated for impairment	$	122	$	—	$	—	$	—	$	178	$	—	$	288	$	—	$	—	$	—	$	—	$	588
Ending balance collectively evaluated for impairment	1,586,110		7,376		54,214		7,388		28,384		54,805		136,774		21,136		22,124		17,167		—		1,935,478
Ending balance	$	1,586,232	$	7,376	$	54,214	$	7,388	$	28,562	$	54,805	$	137,062	$	21,136	$	22,124	$	17,167	$	—	$	1,936,066

Pledged Loans

The Company’s FHLB line of credit is secured under terms of a collateral agreement by a pledge of certain qualifying loans with unpaid principal balances of $1.2 billion and $941.2 million at March 31, 2022 and December 31, 2021, respectively. In addition, the Company pledges eligible tenants in common loans, which totaled $29.7 million and $33.4 million at March 31, 2022 and December 31, 2021, respectively, to secure its borrowing capacity with the Federal Reserve Bank of San Francisco. See Note 8, Long Term Debt and Other Borrowings, for further discussion of these borrowings.

Related Party Loans

The Company has, and expects to have in the future, banking transactions in the ordinary course of its business with directors, officers, principal shareholders, and their businesses or associates. In accordance with applicable regulations and Bank policies, these loans are granted on substantially the same terms, including interest rates and collateral on loans, as those prevailing at the same time for comparable transactions with persons not related to the Company. Likewise, these transactions do not involve more than the normal risk of collectability or present other unfavorable features. Loan commitment to insiders and affiliates, net of cash collateral, totaled $8.9 million at March 31, 2022 and $9.7 million at December 31, 2021.

Interest-Bearing Deposits

3 Months Ended

Mar. 31, 2022

Interest-bearing Deposits

Interest-Bearing Deposits

Interest-bearing deposits consisted of the following as of March 31, 2022 and December 31, 2021:


(in thousands)	March 31, 2022		December 31, 2021
Savings	$	92,370	$	88,536
Money market	919,281		912,558
Interest checking	371,122		278,406
Time, $250 or more	152,877		77,868
Other time	26,157		26,404
Total interest-bearing deposits	$	1,561,807	$	1,383,772

Time deposits totaled $179.0 million and $104.3 million as of March 31, 2022 and December 31, 2021, respectively. As of March 31, 2022, scheduled maturities of time deposits for the next five years were as follows:


(in thousands)
2022	$	177,996
2023	599
2024	438
2025	—
2026	1
Total time deposits	$	179,034

Total deposits include deposits offered through the IntraFi Network (formerly Promontory Interfinancial Network) that are comprised of Certificate of Deposit Account Registry Service® (“CDARS”) balances included in time deposits and Insured Cash Sweep® (“ICS”) balances included in money market deposits. Through this network, the Company offers customers access to FDIC-insured deposit products in aggregate amounts exceeding current insurance limits. When funds are deposited through CDARS and ICS on behalf of a customer, the Company has the option of receiving matching deposits through the network’s reciprocal deposit program or placing deposits “one-way,” for which the Company receives no matching deposits. The Company considers the reciprocal deposits to be in-market deposits, as distinguished from traditional out-of-market brokered deposits. The following table shows the composition of network deposits for March 31, 2022 and December 31, 2021. There were no one-way deposits at March 31, 2022 and December 31, 2021. The composition of network deposits as of March 31, 2022 and December 31, 2021 was as follows:


(in thousands)	March 31, 2022		December 31, 2021
CDARS	$	22,160	$	22,411
ICS	327,384		307,636
Total network deposits	$	349,544	$	330,047

At March 31, 2022 and December 31, 2021, deposits from related parties (directors, executive officers, and principal shareholders) totaled $39.6 million and $32.4 million, respectively.

Interest expense recognized on interest-bearing deposits for periods ended March 31, 2022, and 2021 consisted of the following:


	Three months ended
(in thousands)	March 31, 2022		March 31, 2021
Savings	$	25	$	15
Money market	367		582
Interest checking	70		38
Time, $250 or more	59		7
Other time	24		57
Total interest expense on interest-bearing deposits	$	545	$	699

Leases

3 Months Ended

Mar. 31, 2022

Leases [Abstract]

Leases

The Company leases office space for its banking operations under non-cancelable operating leases of various terms. The leases expire at dates through 2032 and provide for renewal options from zero to five years. In the normal course of business, it is expected that these leases will be renewed or replaced by leases on other properties. One of the leases provides for increases in future minimum annual rental payments based on defined increases in the Consumer Price Index, while the remaining leases include pre-defined rental increases over the term of the lease.

The Company has a sublease agreement for space adjacent to the Redding location. The sublease has renewal terms extended to December 31, 2022.

The Company leases its Sacramento loan production office from a partnership comprised of some of the Company’s shareholders and certain members of its board of directors. The Sacramento loan production office lease extends through April 2023. Additionally, the Company leased its Natomas branch from the same partnership of related parties until July 13, 2021, at which time ownership of the property was transferred to an unrelated third-party landlord. Rent expense paid to the partnership under these leases was insignificant for the three months ended March 31, 2022 and $0.1 million for the three months ended March 31, 2021.

The Company adopted ASU 2016-02, Leases (Topic 842) as of January 1, 2022, which requires the Company to record an ROUA on the consolidated balance sheets for those leases that convey rights to control use of identified assets for a period of time in exchange for consideration. The Company is also required to record a lease liability on the consolidated balance sheets for the present value of future payment commitments. All of the Company’s leases are comprised of operating leases in which the Company is the lessee of real estate property for branches and operations. The Company elected not to include short-term leases (i.e., leases with initial terms of 12 months or less) within the ROUA and lease liability. Known or determinable adjustments to the required minimum future lease payments were included in the calculation of the Company’s ROUA and lease liability. Adjustments to the required minimum future lease payments that are variable and will not be determinable until a future period, if any, such as changes in the Consumer Price Index, are included as variable lease costs. Additionally, expected variable payments for common area maintenance, taxes, and insurance were unknown and not determinable at lease commencement and, therefore, were not included in the determination of the Company’s ROUA or lease liability.

The value of the ROUA and lease liability is impacted by the amount of the periodic payment required, length of the lease term, and the discount rate used to calculate the present value of the minimum lease payments. The Company’s lease agreements often include one or more options to renew at the Company’s discretion. If at lease inception, the Company considers the exercising of a renewal option to be reasonably certain, the Company will include the extended term in the calculation of the ROUA and lease liability. ASC 842 requires the use of the rate implicit in the lease whenever this rate is readily determinable. As this rate is rarely determinable, the Company utilizes its incremental borrowing rate at lease inception, on a collateralized basis, over a similar term. For operating leases existing prior to January 1, 2022, the rate for the remaining lease term as of January 1, 2022 was used. The lease liability is reduced based on the discounted present value of remaining payments as of each reporting period. The ROUA value is measured using the lease liability as adjusted for prepaid or accrued lease payments and remaining lease incentives, unamortized direct costs, and impairment, if any.

The following table presents the components of lease expense for the three months ended March 31, 2022:


(in thousands)	Three months ended March 31, 2022
Operating lease cost	$	285
Short-term lease cost	—
Variable lease cost	—
Sublease income	(5)
Total lease cost	$	280

Prior to the adoption of ASU 2016-02, rent expense under operating leases was $0.3 million during the three months ended March 31, 2021. Rent expense was partially offset by rent income of $5.2 thousand during the three months ended March 31, 2021.

The following table presents the weighted average operating lease term and discount rate at March 31, 2022:


	March 31, 2022
Weighted average remaining lease term (in years)	5.87 years
Weighted average discount rate	2.14	%

The following table shows the future expected operating lease payments under the Company's operating lease agreements as of March 31, 2022:


(in thousands)
2022	$	803
2023	1,009
2024	984
2025	767
2026	665
Thereafter	1,107
Total expected operating lease payments	5,335
Discount for present value of expected cash flows	(348)
Lease liability at March 31, 2022	$	4,987

Long Term Debt and Other Borrowings	3 Months Ended
Long Term Debt and Other Borrowings	Mar. 31, 2022
Debt Disclosure [Abstract]
Long Term Debt and Other Borrowings	Long Term Debt and Other Borrowings Subordinated notes: On November 8, 2019, the Company completed a private placement of $3.8 million of fixed-to-floating rate subordinated notes to certain qualified investors. All of the debt was purchased by four existing members of the board of directors or their affiliates. The notes were used for general corporate purposes, capital management, and to support future growth. The subordinated notes have a maturity date of September 15, 2027 and bear interest, payable semi-annually, at the rate of 5.50% per annum until September 15, 2022. On that date, the interest rate will be adjusted to float at a rate equal to the three-month LIBOR plus 354.4 basis points (4.38% as of March 31, 2022) until maturity. The notes include a right of prepayment, on or after September 15, 2022 or, in certain limited circumstances, before that date. The indebtedness evidenced by the subordinated notes, including principal and interest, is unsecured and subordinate and junior in right to payment to general and secured creditors and depositors of the Company. On September 28, 2017, the Company completed a private placement of $25.0 million of fixed-to-floating rate subordinated notes to certain qualified investors, of which $8.0 million is owned by an entity that is controlled by a member of the board of directors and three principal shareholders. The notes were used for general corporate purposes, capital management, and to support future growth. The subordinated notes have a maturity date of September 15, 2027 and bear interest, payable semi-annually, at the rate of 6.00% per annum until September 15, 2022. On that date, the interest rate will be adjusted to float at a rate equal to the three-month LIBOR plus 404.4 basis points (4.88% as of March 31, 2022) until maturity. The notes include a right of prepayment, on or after September 15, 2022 or, in certain limited circumstances, before that date. The indebtedness evidenced by the subordinated notes, including principal and interest, is unsecured and subordinate and junior in right to payment to general and secured creditors and depositors of the Company. The subordinated notes have been structured to qualify as Tier 2 capital for the Company for regulatory capital purposes. Debt issuance costs incurred in conjunction with the notes were $0.6 million, of which $0.3 million has been amortized through March 31, 2022. The Company reflects debt issuance costs as a direct deduction from the face of the note. The debt issuance costs are amortized into interest expense through the maturity period. At March 31, 2022 and December 31, 2021, the Company’s subordinated debt outstanding was $28.4 million. Other borrowings: In 2005, and through an amendment in 2014, the Company entered into an agreement with the FHLB which granted the FHLB a blanket lien on all loans receivable (except for construction and agricultural loans) as collateral for a borrowing line. Based on the dollar volume of qualifying loan collateral, the Company had a total financing availability of $855.9 million at March 31, 2022 and $696.3 million at December 31, 2021. At March 31, 2022 and December 31, 2021, the Company had no outstanding borrowings. As of March 31, 2022 and December 31, 2021, the Company had letters of credit (“LCs”) issued on its behalf totaling $495.5 million and $420.5 million, respectively, as discussed below. At March 31, 2022 and December 31, 2021, LCs totaling $155.5 million and $80.5 million, respectively, were pledged to secure State of California deposits and $340.0 million were pledged to secure local agency deposits. The LCs issued reduced the Company’s available borrowing capacity to $360.4 million and $275.8 million as of March 31, 2022 and December 31, 2021, respectively. At December 31, 2021, the Company had five unsecured federal funds lines of credit totaling $150.0 million with five of its correspondent banks, respectively. During the quarter ended March 31, 2022, the borrowing capacity of one of the Company's existing unsecured federal funds lines of credit was increased by $10.0 million. As a result, at March 31, 2022, the Company had five unsecured federal funds lines of credit totaling $160.0 million with five of its correspondent banks, respectively. There were no amounts outstanding at March 31, 2022 and December 31, 2021. At March 31, 2022 and December 31, 2021, the Company had the ability to borrow from the Federal Reserve Discount Window. At March 31, 2022 and December 31, 2021, the borrowing capacity under this arrangement was $18.0 million and $17.0 million, respectively. There were no amounts outstanding at March 31, 2022 and December 31, 2021. The borrowing line is secured by liens on the Company’s construction and agricultural loan portfolios.

- Definition

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

+ References

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+ Details

Income Taxes

3 Months Ended

Mar. 31, 2022

Income Tax Disclosure [Abstract]

Income Taxes

The Company terminated its status as a Subchapter S Corporation as of May 5, 2021, in connection with the IPO and became a taxable C Corporation. Prior to that date, as an S Corporation, the Company had no U.S. federal income tax expense. As such, any periods prior to May 5, 2021 will only reflect a state income tax rate and corresponding tax expense. Pro forma net income is calculated by adding back S Corporation tax to net income and using a combined C Corporation statutory tax rate for federal and state income taxes of 29.56%. For the 2022 period presented below, the tax rate reflects the actual effective tax rate for the three months ended March 31, 2022, as the Company was a C Corporation for the entire period. The following reconciliation table provides a detailed calculation of pro forma provision for income taxes:


	For the three months ended
(in thousands)	March 31, 2022			March 31, 2021
Net income before provision for income taxes	$	13,522		$	10,660
Effective/pro forma tax rate	27.07		%	29.56		%
Actual/pro forma provision for income taxes	$	3,660		$	3,151

The provision for income tax for the three months ended March 31, 2022 and 2021 differs from the statutory federal rate of 21.00% due to the following items, which relate primarily to the Company’s conversion from an S Corporation to a C Corporation during the second quarter of 2021:


	For the three months ended
(in thousands)	March 31, 2022		March 31, 2021
Statutory U.S. federal income tax	$	2,840	$	2,239
Increase (decrease) resulting from:
Benefit of S Corporation status	—		(2,239)
State taxes	1,157		382


Other	(337)		—
Provision for income taxes	$	3,660	$	382

For the three months ended March 31, 2022, the Company’s federal and state statutory tax rate, net of federal benefit, of 29.56%, differed from the statutory California tax rate of 3.50% used for the three months ended March 31, 2021 due to the termination of the Company's Subchapter S Corporation status as of May 5, 2021.

- Definition

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

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Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
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-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(h)(2))
-URI http://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690

+ Details

Shareholders’ Equity

3 Months Ended

Mar. 31, 2022

Equity [Abstract]

Shareholders' Equity

Shareholders’ Equity

Dividends

On January 20, 2022, the board of directors declared a $0.15 per common share dividend, totaling $2.6 million. On March 17, 2022, based on the filing of the Company's final S Corporation tax return, the board of directors declared a $0.45 per common share dividend to shareholders of record as of May 3, 2021, totaling $4.9 million, which was the remaining balance of the Company's accumulated adjustments account, and is described in further detail in the Company’s Proxy Statement filed with the SEC and mailed to shareholders on April 6, 2022.

Stock-Based Incentive Arrangement

The Company’s stock-based compensation consists of RSAs granted under its historical stock-based incentive arrangement (the “Historical Incentive Plan”) and RSAs issued under the Five Star Bancorp 2021 Equity Incentive Plan (the "Equity Incentive Plan"). The Historical Incentive Plan consisted of RSAs for certain executive officers of the Company. The arrangement provided that these executive officers would receive shares of restricted common stock of the Company that vested over three years, with the number of shares granted based upon achieving certain performance objectives. These objectives included, but were not limited to, net income adjusted for the provision for loan losses, deposit growth, efficiency ratio, net interest margin, and asset quality. Compensation expense for RSAs granted under the Historical Incentive Plan is recognized over the service period, which is equal to the vesting period of the shares based on the fair value of the shares at issue date.

In connection with its IPO in May 2021, the Company granted RSAs under the Equity Incentive Plan to employees, officers, executives, and non-employee directors. Shares granted to non-employee directors vested immediately upon grant, while shares granted to employees, officers, and executives vest ratably over three, five, or seven years (as defined in the respective agreements). Since the completion of the IPO, the Company has granted RSAs under the Equity Incentive Plan to executives and directors, which vest annually over three years and monthly over one year, respectively. All RSAs were granted at the fair value of common stock at the time of the award. The RSAs are considered fixed awards as the number of shares and fair value are known at the date of grant and the fair value at the grant date is amortized over the service period.

The Company granted 22,201 and 9,454 restricted shares during the three months ended March 31, 2022 and 2021, respectively. In addition, 850 and 2,722 restricted shares were forfeited during the three months ended March 31, 2022 and 2021, respectively. Non-cash stock compensation expense recognized for the three months ended March 31, 2022 and 2021 was $0.3 million and $0.1 million, respectively.

At March 31, 2022 and 2021, respectively, there were 138,856 and 6,296 unvested restricted shares. As of March 31, 2022, there was approximately $2.5 million of unrecognized compensation expense related to the 138,856 unvested restricted shares. The holders of unvested RSAs are entitled to dividends at the same per-share ratio as holders of common stock. Tax benefits for dividends paid on unvested RSAs are recorded as tax benefits in the consolidated statements of income with a corresponding decrease to current taxes payable. The impact of tax benefits for dividends paid on unvested restricted stock on the Company’s consolidated statements of income for the three months ended March 31, 2022 and 2021 was immaterial.

The following table summarizes information about unvested restricted shares:


	For the three months ended March 31,
	2022			2021
	Shares	Weighted Average Grant Date Fair Value		Shares	Weighted Average Grant Date Fair Value
Beginning of the period balance	127,751	$	19.95	11,568	$	21.25
Shares granted	22,201	28.50		9,454	18.00
Shares vested	(10,246)	24.85		(12,004)	20.45
Shares forfeited	(850)	20.00		(2,722)	18.88
End of the period balance	138,856	$	20.95	6,296	$	18.91

- Definition

The entire disclosure for shareholders' equity comprised of portions attributable to the parent entity and noncontrolling interest, including other comprehensive income. Includes, but is not limited to, balances of common stock, preferred stock, additional paid-in capital, other capital and retained earnings, accumulated balance for each classification of other comprehensive income and amount of comprehensive income.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 13
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=123467817&loc=SL123496158-112644

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-Publisher FASB
-Name Accounting Standards Codification
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-URI http://asc.fasb.org/extlink&oid=123467817&loc=SL123496158-112644

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
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Reference 4: http://www.xbrl.org/2003/role/disclosureRef
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-URI http://asc.fasb.org/extlink&oid=123467817&loc=SL123496171-112644

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section S99
-Paragraph 1
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-URI http://asc.fasb.org/extlink&oid=120397183&loc=d3e187085-122770

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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-Section 50
-Paragraph 18
-Subparagraph (d)
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Reference 7: http://www.xbrl.org/2003/role/disclosureRef
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-Publisher FASB
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Reference 9: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
-Topic 505
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-Publisher FASB
-Name Accounting Standards Codification
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Reference 11: http://www.xbrl.org/2003/role/disclosureRef
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Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
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Reference 14: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
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Reference 15: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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-Paragraph 1
-Subparagraph (SX 210.4-08(e)(1))
-URI http://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690

+ Details

Commitments and Contingencies

3 Months Ended

Mar. 31, 2022

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Financial Instruments with Off-Balance Sheet Risk

Some financial instruments, such as loan commitments, credit lines, letters of credit, and overdraft protection, are issued to meet customer financing needs. These are agreements to provide credit or to support the credit of others, as long as conditions established in the contract are met, and usually have expiration dates. Commitments may expire without being used. Substantially all of these commitments are at variable interest rates, based on an index, and have fixed expiration dates.

Off-balance sheet risk to loan loss exists up to the face amount of these instruments, although material losses are not anticipated. The Company uses the same credit policies in making commitments to originate loans and lines of credit as it does for on-balance sheet instruments, including obtaining collateral at exercise of the commitment. The contractual amounts of unfunded loan commitments and standby letters of credit not reflected in the consolidated balance sheets are as follows:


(in thousands)	March 31, 2022		December 31, 2021
Commercial lines of credit	$	116,857	$	137,354
Undisbursed construction loans	48,918		46,584
Undisbursed commercial real estate loans	65,592		47,793
Agricultural lines of credit	11,608		9,955
Undisbursed agricultural real estate loans	3,428		3,427
Other	3,040		3,764
Total commitments and standby letters of credit	$	249,443	$	248,877

The Company records an allowance for loan losses on unfunded loan commitments at the consolidated balance sheet date based on estimates of the probability that these commitments will be drawn upon according to historical utilization experience of the different types of commitments and historical loss rates determined for pooled funded loans. The allowance for loan losses on unfunded commitments totaled $0.1 million as of March 31, 2022 and December 31, 2021, which is recorded in interest payable and other liabilities in the consolidated balance sheets.

Concentrations of credit risk: The Company grants real estate mortgage, real estate construction, commercial, and consumer loans to customers primarily in Northern California. Although the Company has a diversified loan portfolio, a substantial portion is secured by commercial and residential real estate.

In management’s judgment, a concentration of loans exists in real estate related loans, which represented approximately 91.98% of the Company’s loans held for investment at March 31, 2022 and 89.87% of the Company’s loans held for investment at December 31, 2021. Although management believes such concentrations have no more than the normal risk of collectability, a substantial decline in the economy in general, or a decline in real estate values in the Company’s primary market areas in particular, could have an adverse impact on the collectability of these loans. Personal and business incomes represent the primary source of repayment for the majority of these loans.

Deposit concentrations: At March 31, 2022, the Company had 66 deposit relationships that exceeded $5.0 million each, totaling $1.2 billion, or approximately 46.75% of total deposits. The Company’s largest single deposit relationship at March 31, 2022 totaled $182.4 million, or approximately 7.29% of total deposits. Management maintains the Company’s liquidity position and lines of credit with correspondent banks to mitigate the risk of large withdrawals by this group of large depositors.

Contingencies: The Company is subject to legal proceedings and claims which arise in the ordinary course of business. In the opinion of management, the amount of ultimate liability with respect to such actions will not materially affect the consolidated financial position or results of operations of the Company.

Correspondent banking agreements: The Company maintains funds on deposit with other FDIC-insured financial institutions under correspondent banking agreements. Uninsured deposits through these agreements totaled $77.3 million and $147.2 million at March 31, 2022 and December 31, 2021, respectively.

Litigation Matters

The Company is subject to legal proceedings and claims which arise in the ordinary course of business. In the opinion of management, the amount of ultimate liability with respect to such actions will not materially affect the consolidated financial position or results of operations of the Company.

Subsequent Events	3 Months Ended
Subsequent Events	Mar. 31, 2022
Subsequent Events [Abstract]
Subsequent Events	Subsequent EventsOn April 21, 2022, the board of directors declared a $0.15 per common share dividend, totaling $2.6 million.

Basis of Presentation (Policies)

3 Months Ended

Mar. 31, 2022

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Nature of Operations and Principles of Consolidation

Basis of Financial Statement Presentation and Consolidation

The Company’s accounting and reporting policies conform to GAAP and to general practices within the banking industry.

Use of Estimates

Earnings Per Share (“EPS”)


	Three months ended
(in thousands, except per share data)	March 31, 2022		March 31, 2021
Net income	$	9,862	$	10,278
Weighted average basic common shares outstanding	17,102,508		10,998,041
Add: Dilutive effects of assumed vesting of restricted stock	62,011		—
Weighted average diluted common shares outstanding	17,164,519		10,998,041
Income per common share:
Basic EPS	$	0.58	$	0.93
Diluted EPS	$	0.58	$	0.93

Leases

Basis of Presentation (Tables)

3 Months Ended

Mar. 31, 2022

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Schedule of Earnings Per Share


	Three months ended
(in thousands, except per share data)	March 31, 2022		March 31, 2021
Net income	$	9,862	$	10,278
Weighted average basic common shares outstanding	17,102,508		10,998,041
Add: Dilutive effects of assumed vesting of restricted stock	62,011		—
Weighted average diluted common shares outstanding	17,164,519		10,998,041
Income per common share:
Basic EPS	$	0.58	$	0.93
Diluted EPS	$	0.58	$	0.93

Schedule of Pro Forma Earning Per Share

The following reconciliation table provides a detailed calculation of pro forma EPS:


	Three months ended
(in thousands, except per share data)	March 31, 2022		March 31, 2021
Net income before provision for income taxes - GAAP	$	13,522	$	10,660
Less: Actual/pro forma provision for income taxes	3,660		3,151
Actual/pro forma net income	$	9,862	$	7,509

Weighted average basic common shares outstanding	17,102,508		10,998,041
Add: Dilutive effects of assumed vesting of restricted stock	62,011		—
Weighted average diluted common shares outstanding	17,164,519		10,998,041

Income per common share:
Basic EPS (actual/pro forma)	$	0.58	$	0.68
Diluted EPS (actual/pro forma)	$	0.58	$	0.68

Fair Value of Assets and Liabilities (Tables)

3 Months Ended

Mar. 31, 2022

Fair Value Disclosures [Abstract]

Summary of Fair Value of Assets and Liabilities Measured on Recurring Basis

The following table summarizes the Company’s assets and liabilities that were required to be recorded at fair value on a recurring basis.


(in thousands)	Carrying Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Measurement Categories: Changes in Fair Value Recorded In1
March 31, 2022
Assets:
Securities available-for-sale:
U.S. government agencies, mortgage-backed securities, obligations of states and political subdivisions, collateralized mortgage obligations, and corporate bonds	$	134,813	$	—	$	134,813	$	—	OCI
Derivatives – interest rate swap	58		—		58		—		NI
Liabilities:
Derivatives – interest rate swap	58		—		58		—		NI

December 31, 2021
Assets:
Securities available-for-sale:
U.S. government agencies, mortgage-backed securities, obligations of states and political subdivisions, collateralized mortgage obligations, and corporate bonds	$	148,807	$	—	$	148,807	$	—	OCI
Derivatives – interest rate swap	92		—		92		—		NI
Liabilities:
Derivatives – interest rate swap	92		—		92		—		NI

1Other comprehensive income (“OCI”) or net income (“NI”).

Summary of Fair Value Estimates for Financial Instruments by Balance Sheet Grouping


	March 31, 2022					December 31, 2021
(in thousands)	Carrying Amounts		Fair Value		Fair Value Hierarchy	Carrying Amounts		Fair Value		Fair Value Hierarchy
Financial assets:
Cash and cash equivalents	$	504,964	$	504,964	Level 1	$	425,329	$	425,329	Level 1
Time deposits in banks	14,464		14,464		Level 1	14,464		14,464		Level 1
Securities available-for-sale	134,813		134,813		Level 2	148,807		148,807		Level 2
Securities held-to-maturity	4,486		4,459		Level 3	4,946		5,197		Level 3
Loans held for sale	10,386		11,063		Level 2	10,671		11,217		Level 2
Loans held for investment, net of allowance for loan losses	2,056,254		1,993,626		Level 3	1,911,217		1,893,431		Level 3
FHLB stock and other investments	12,383		N/A		N/A	12,464		N/A		N/A
Interest receivable	5,547		5,547		Level 2	5,332		5,332		Level 2
Interest rate swap	58		58		Level 2	92		92		Level 2
Financial liabilities:
Deposits	2,503,092		2,349,536		Level 2	2,285,890		2,210,555		Level 2
Interest payable	79		79		Level 2	23		23		Level 2
Interest rate swap	58		58		Level 2	92		92		Level 2
Subordinated notes	28,403		28,403		Level 3	28,386		28,386		Level 3

Investment Securities (Tables)

3 Months Ended

Mar. 31, 2022

Investments, Debt and Equity Securities [Abstract]

Summary of Debt Securities Held-to-maturity

A summary of the amortized cost and fair value related to securities held-to-maturity as of March 31, 2022 and December 31, 2021 is presented below.


(in thousands)			Gross Unrealized
	Amortized Cost		Gains		(Losses)		Fair Value
March 31, 2022
Obligations of states and political subdivisions	$	4,486	$	—	$	(27)	$	4,459
Total held-to-maturity	$	4,486	$	—	$	(27)	$	4,459
December 31, 2021
Obligations of states and political subdivisions	$	4,946	$	251	$	—	$	5,197
Total held-to-maturity	$	4,946	$	251	$	—	$	5,197

Summary of Debt Securities Available-for-sale

A summary of the amortized cost and fair value related to securities available-for-sale as of March 31, 2022 and December 31, 2021 is presented below.


(in thousands)	Amortized Cost		Gross Unrealized				Fair Value
			Gains		(Losses)
March 31, 2022
U.S. government agencies	$	18,241	$	95	$	(257)	$	18,079
Mortgage-backed securities	79,694		8		(6,210)		73,492
Obligations of states and political subdivisions	44,621		23		(3,713)		40,931
Collateralized mortgage obligations	504		—		(21)		483
Corporate bonds	2,000		—		(172)		1,828
Total available-for-sale	$	145,060	$	126	$	(10,373)	$	134,813
December 31, 2021
U.S. government agencies	$	19,824	$	60	$	(202)	$	19,682
Mortgage-backed securities	82,517		94		(1,098)		81,513
Obligations of states and political subdivisions	44,732		525		(120)		45,137
Collateralized mortgage obligations	537		3		—		540
Corporate bonds	2,000		—		(65)		1,935
Total available-for-sale	$	149,610	$	682	$	(1,485)	$	148,807

Summary of Investment Debt Securities by Contractual Maturity


(in thousands)	March 31, 2022								December 31, 2021
	Held-to-Maturity				Available-for-Sale				Held-to-Maturity				Available-for-Sale
	Amortized Cost		Fair Value		Amortized Cost		Fair Value		Amortized Cost		Fair Value		Amortized Cost		Fair Value
Within one year	$	456	$	454	$	—	$	—	$	491	$	516	$	—	$	—
After one but within five years	1,115		1,108		505		514		951		999		507		522
After five years through ten years	1,590		1,580		3,684		3,458		3,504		3,682		3,697		3,748
After ten years	1,325		1,317		40,432		36,959		—		—		40,528		40,867

Investment securities not due at a single maturity date:
U.S. government agencies	—		—		18,241		18,079		—		—		19,824		19,682
Mortgage-backed securities	—		—		79,694		73,492		—		—		82,517		81,513
Collateralized mortgage obligations	—		—		504		483		—		—		537		540
Corporate bonds	—		—		2,000		1,828		—		—		2,000		1,935
Total	$	4,486	$	4,459	$	145,060	$	134,813	$	4,946	$	5,197	$	149,610	$	148,807

Schedule of Realized Gain (Loss)

Sales of investment securities and gross gains and losses are shown in the following table:


(in thousands)	For the three months ended
	March 31, 2022		March 31, 2021
Available-for-sale:
Sales proceeds	$	1,623	$	11,456
Gross realized gains	5		182

Schedule of Pledged Investment Securities

Pledged investment securities are shown in the following table:


(in thousands)	March 31, 2022		December 31, 2021
Pledged to the State of California:
Secure deposits of public funds and borrowings	$	57,423	$	63,363
Total pledged investment securities	$	57,423	$	63,363

Schedule of Unrealized Losses and Fair Value of Available-for-sale Securities


(in thousands)	< 12 continuous months				≥ 12 continuous months				Total securities in a loss position
	Fair Value		Unrealized Loss		Fair Value		Unrealized Loss		Fair Value		Unrealized Loss
March 31, 2022
U.S. government agencies	$	2,275	$	(77)	$	12,371	$	(180)	$	14,646	$	(257)
Mortgage-backed securities	62,090		(5,122)		10,969		(1,088)		73,059		(6,210)
Obligations of states and political subdivisions	37,803		(3,540)		1,791		(173)		39,594		(3,713)
Collateralized mortgaged obligations	483		(21)		—		—		483		(21)
Corporate bonds	1,828		(172)		—		—		1,828		(172)
Total temporarily impaired securities	$	104,479	$	(8,932)	$	25,131	$	(1,441)	$	129,610	$	(10,373)

December 31, 2021
U.S. government agencies	$	—	$	—	$	13,399	$	(202)	$	13,399	$	(202)
Mortgage-backed securities	73,972		(1,046)		1,400		(52)		75,372		(1,098)
Obligations of states and political subdivisions	14,014		(112)		407		(8)		14,421		(120)
Corporate bonds	1,935		(65)		—		—		1,935		(65)
Total temporarily impaired securities	$	89,921	$	(1,223)	$	15,206	$	(262)	$	105,127	$	(1,485)

Loans and Allowance for Loan Losses (Tables)

3 Months Ended

Mar. 31, 2022

Receivables [Abstract]

Schedule of Accounts, Notes, Loans and Financing Receivable

The following table presents the balance of each major product type within the Company’s portfolio as of the dates indicated.


(in thousands)	March 31, 2022		December 31, 2021
Real estate:
Commercial	$	1,760,551	$	1,586,232
Commercial land and development	9,090		7,376
Commercial construction	59,293		54,214
Residential construction	5,540		7,388
Residential	28,921		28,562
Farmland	49,903		54,805
Commercial:
Secured	124,930		137,062
Unsecured	22,599		21,136
Paycheck Protection Program (“PPP”)	1,528		22,124
Consumer and other	19,044		17,167
Subtotal	2,081,399		1,936,066
Less: Net deferred loan fees	1,241		1,606
Less: Allowance for loan losses	23,904		23,243
Loans held for investment, net of allowance for loan losses	$	2,056,254	$	1,911,217

Summary of Credit Quality Indicators

The following table summarizes the credit quality indicators related to the Company’s loans by class as of March 31, 2022:


(in thousands)	Pass		Watch		Substandard		Doubtful		Total
Real estate:
Commercial	$	1,751,563	$	8,087	$	901	$	—	$	1,760,551
Commercial land and development	9,090		—		—		—		9,090
Commercial construction	53,393		5,900		—		—		59,293
Residential construction	5,540		—		—		—		5,540
Residential	28,744		—		177		—		28,921
Farmland	49,903		—		—		—		49,903
Commercial:
Secured	122,996		14		1,920		—		124,930
Unsecured	22,599		—		—		—		22,599
PPP	1,528		—		—		—		1,528
Consumer	19,032		—		12		—		19,044
Total	$	2,064,388	$	14,001	$	3,010	$	—	$	2,081,399

The following table summarizes the credit quality indicators related to the Company’s loans by class as of December 31, 2021:


(in thousands)	Pass		Watch		Substandard		Doubtful		Total
Real estate:
Commercial	$	1,575,006	$	1,970	$	9,256	$	—	$	1,586,232
Commercial land and development	7,376		—		—		—		7,376
Commercial construction	48,288		5,926		—		—		54,214
Residential construction	7,388		—		—		—		7,388
Residential	28,384		—		178		—		28,562
Farmland	54,805		—		—		—		54,805
Commercial:
Secured	135,131		751		1,180		—		137,062
Unsecured	21,136		—		—		—		21,136
PPP	22,124		—		—		—		22,124
Consumer	17,167		—		—		—		17,167
Total	$	1,916,805	$	8,647	$	10,614	$	—	$	1,936,066

Summary of Age Analysis of Past Due Loans

The age analysis of past due loans by class as of March 31, 2022 consisted of the following:


(in thousands)	Past Due
	30-89 Days		Greater Than 90 Days		Total Past Due		Current		Total Loans Receivable
Real estate:
Commercial	$	—	$	—	$	—	$	1,760,551	$	1,760,551
Commercial land and development	—		—		—		9,090		9,090
Commercial construction	—		—		—		59,293		59,293
Residential construction	—		—		—		5,540		5,540
Residential	—		—		—		28,921		28,921
Farmland	—		—		—		49,903		49,903
Commercial:
Secured	422		—		422		124,508		124,930
Unsecured	—		—		—		22,599		22,599
PPP	—		—		—		1,528		1,528
Consumer and other	127		—		127		18,917		19,044
Total	$	549	$	—	$	549	$	2,080,850	$	2,081,399

The age analysis of past due loans by class as of December 31, 2021 consisted of the following:


(in thousands)	Past Due				Total Past Due		Current		Total Loans Receivable
	30-89 Days		Greater Than 90 Days
Real estate:
Commercial	$	—	$	—	$	—	$	1,586,232	$	1,586,232
Commercial land and development	—		—		—		7,376		7,376
Commercial construction	—		—		—		54,214		54,214
Residential construction	—		—		—		7,388		7,388
Residential	—		—		—		28,562		28,562
Farmland	—		—		—		54,805		54,805
Commercial:
Secured	—		—		—		137,062		137,062
Unsecured	—		—		—		21,136		21,136
PPP	—		—		—		22,124		22,124
Consumer and other	334		—		334		16,833		17,167
Total	$	334	$	—	$	334	$	1,935,732	$	1,936,066

Schedule of Impaired Loans

Information related to impaired loans as of March 31, 2022 and December 31, 2021 consisted of the following:


	March 31, 2022						December 31, 2021
(in thousands)	Recorded Investment		Unpaid Principal Balance		Related Allowance		Recorded Investment		Unpaid Principal Balance		Related Allowance
With no related allowance recorded:
Real estate:
Commercial	$	118	$	118	$	—	$	122	$	122	$	—
Residential	177		177		—		178		178		—
Commercial:
Secured	111		111		—		116		116		—
Consumer and other	12		12		—		—		—		—
	$	418	$	418	$	—	$	416	$	416	$	—

With an allowance recorded:
Commercial:
Secured	$	922	$	922	$	639	$	172	$	172	$	172
	$	922	$	922	$	639	$	172	$	172	$	172

Total by category:
Real estate:
Commercial	$	118	$	118	$	—	$	122	$	122	$	—
Residential	177		177		—		178		178		—
Commercial:
Secured	1,033		1,033		639		288		288		172
Consumer and other	12		12		—		—		—		—
Total impaired loans	$	1,340	$	1,340	$	639	$	588	$	588	$	172

No collateral dependent loans were in process of foreclosure at March 31, 2022 or December 31, 2021.

Information related to impaired loans for the three months ended March 31, 2022 and 2021 consisted of the following:


	Three months ended
	March 31, 2022				March 31, 2021
(in thousands)	Average Recorded Investment		Interest Income Recognized			Average Recorded Investment		Interest Income Recognized
With no related allowance recorded:
Real estate:
Commercial	$	120	$	—		$	136	$	—
Residential	178		—			182		—
Commercial:
Secured	174		—			129		—
Consumer and other	25		—			—		—
	$	497	$	—		$	447	$	—

With an allowance recorded:
Commercial:
Secured	$	947	$	—		$	—	$	—
Consumer and other	—		—			36		—
	$	947	$	—		$	36	$	—

Total by category:
Real estate:
Commercial	$	120	$	—		$	136	$	—
Residential	178		—			182		—
Commercial:
Secured	1,121		—			129		—
Consumer and other	25		—			36		—
Total impaired loans	$	1,444	$	—		$	483	$	—

Schedule of Non-accrual Loans

Non-accrual loans, segregated by class, are as follows as of March 31, 2022 and December 31, 2021:


(in thousands)	March 31, 2022		December 31, 2021
Real estate:
Commercial	$	118	$	122
Residential	177		178
Commercial:
Secured	1,033		288
Total non-accrual loans	$	1,328	$	588

Disclosure of Activity in the Allowance For Loan Losses

The following table discloses activity in the allowance for loan losses for the periods presented.


	Real Estate												Commercial
(in thousands)	Comml		Comml Land and Devel		Comml Const		Resid Const		Resid		Farm- land		Secured		Unsec		PPP		Consu		Unal		Total
Three months ended March 31, 2022
Beginning balance	$	12,869	$	50	$	371	$	50	$	192	$	645	$	6,859	$	207	$	—	$	889	$	1,111	$	23,243
Charge-offs	—		—		—		—		—		—		(309)		—		—		(67)		—		(376)
Recoveries	—		—		—		—		—		—		46		—		—		41		—		87
Provision (recapture)	999		16		59		(10)		16		(34)		443		39		—		225		(803)		950
Ending balance	$	13,868	$	66	$	430	$	40	$	208	$	611	$	7,039	$	246	$	—	$	1,088	$	308	$	23,904
Three months ended March 31, 2021
Beginning balance	$	9,358	$	77	$	821	$	87	$	220	$	615	$	9,476	$	179	$	—	$	632	$	724	$	22,189
Charge-offs	—		—		—		—		—		—		(255)		—		—		—		—		(255)
Recoveries	—		—		—		—		—		—		87		—		—		50		—		137
Provision (recapture)	861		3		(317)		(30)		(32)		(37)		(390)		16		—		(82)		208		200
Ending balance	$	10,219	$	80	$	504	$	57	$	188	$	578	$	8,918	$	195	$	—	$	600	$	932	$	22,271

The following table summarizes the allocation of the allowance for loan losses by impairment methodology for the periods presented.


	Real Estate												Commercial
(in thousands)	Comml		Comml Land and Devel		Comml Const		Resid Const		Resid		Farm- land		Secured		Unsec		PPP		Consu		Unal		Total
As of March 31, 2022:
Ending allowance balance allocated to:
Loans individually evaluated for impairment	$	—	$	—	$	—	$	—	$	—	$	—	$	639	$	—	$	—	$	—	$	—	$	639
Loans collectively evaluated for impairment	13,868		66		430		40		208		611		6,400		246		—		1,088		308		23,265
Ending balance	$	13,868	$	66	$	430	$	40	$	208	$	611	$	7,039	$	246	$	—	$	1,088	$	308	$	23,904
Loans:
Ending balance individually evaluated for impairment	$	118	$	—	$	—	$	—	$	177	$	—	$	1,034	$	—	$	—	$	12	$	—	$	1,341
Ending balance collectively evaluated for impairment	1,760,433		9,090		59,293		5,540		28,744		49,903		123,896		22,599		1,528		19,032		—		2,080,058
Ending balance	$	1,760,551	$	9,090	$	59,293	$	5,540	$	28,921	$	49,903	$	124,930	$	22,599	$	1,528	$	19,044	$	—	$	2,081,399

As of December 31, 2021:
Ending allowance balance allocated to:
Loans individually evaluated for impairment	$	—	$	—	$	—	$	—	$	—	$	—	$	172	$	—	$	—	$	—	$	—	$	172
Loans collectively evaluated for impairment	12,869		50		371		50		192		645		6,687		207		—		889		1,111		23,071
Ending balance	$	12,869	$	50	$	371	$	50	$	192	$	645	$	6,859	$	207	$	—	$	889	$	1,111	$	23,243
Loans:
Ending balance individually evaluated for impairment	$	122	$	—	$	—	$	—	$	178	$	—	$	288	$	—	$	—	$	—	$	—	$	588
Ending balance collectively evaluated for impairment	1,586,110		7,376		54,214		7,388		28,384		54,805		136,774		21,136		22,124		17,167		—		1,935,478
Ending balance	$	1,586,232	$	7,376	$	54,214	$	7,388	$	28,562	$	54,805	$	137,062	$	21,136	$	22,124	$	17,167	$	—	$	1,936,066

Interest-Bearing Deposits (Tables)

3 Months Ended

Mar. 31, 2022

Interest-bearing Deposits

Schedule of Interest-Bearing Deposits.

Interest-bearing deposits consisted of the following as of March 31, 2022 and December 31, 2021:


(in thousands)	March 31, 2022		December 31, 2021
Savings	$	92,370	$	88,536
Money market	919,281		912,558
Interest checking	371,122		278,406
Time, $250 or more	152,877		77,868
Other time	26,157		26,404
Total interest-bearing deposits	$	1,561,807	$	1,383,772

Time Deposit Maturities

As of March 31, 2022, scheduled maturities of time deposits for the next five years were as follows:


(in thousands)
2022	$	177,996
2023	599
2024	438
2025	—
2026	1
Total time deposits	$	179,034

Schedule of Composition of Network Deposits

The composition of network deposits as of March 31, 2022 and December 31, 2021 was as follows:


(in thousands)	March 31, 2022		December 31, 2021
CDARS	$	22,160	$	22,411
ICS	327,384		307,636
Total network deposits	$	349,544	$	330,047

Interest Expense Recognized on Interest-Bearing Deposits

Interest expense recognized on interest-bearing deposits for periods ended March 31, 2022, and 2021 consisted of the following:


	Three months ended
(in thousands)	March 31, 2022		March 31, 2021
Savings	$	25	$	15
Money market	367		582
Interest checking	70		38
Time, $250 or more	59		7
Other time	24		57
Total interest expense on interest-bearing deposits	$	545	$	699

Leases (Tables)

3 Months Ended

Mar. 31, 2022

Leases [Abstract]

Schedule of Lease Cost

The following table presents the components of lease expense for the three months ended March 31, 2022:


(in thousands)	Three months ended March 31, 2022
Operating lease cost	$	285
Short-term lease cost	—
Variable lease cost	—
Sublease income	(5)
Total lease cost	$	280

Schedule of Weighted Average Lease Term and Discount Rate

The following table presents the weighted average operating lease term and discount rate at March 31, 2022:


	March 31, 2022
Weighted average remaining lease term (in years)	5.87 years
Weighted average discount rate	2.14	%

Schedule of Future Minimum Rental Payments for Operating Leases

The following table shows the future expected operating lease payments under the Company's operating lease agreements as of March 31, 2022:


(in thousands)
2022	$	803
2023	1,009
2024	984
2025	767
2026	665
Thereafter	1,107
Total expected operating lease payments	5,335
Discount for present value of expected cash flows	(348)
Lease liability at March 31, 2022	$	4,987

Income Taxes (Tables)

3 Months Ended

Mar. 31, 2022

Income Tax Disclosure [Abstract]

Schedule of Pro Forma Provision of Income Taxes

The following reconciliation table provides a detailed calculation of pro forma provision for income taxes:


	For the three months ended
(in thousands)	March 31, 2022			March 31, 2021
Net income before provision for income taxes	$	13,522		$	10,660
Effective/pro forma tax rate	27.07		%	29.56		%
Actual/pro forma provision for income taxes	$	3,660		$	3,151

Schedule of Components of Income Tax Expense (Benefit)


	For the three months ended
(in thousands)	March 31, 2022		March 31, 2021
Statutory U.S. federal income tax	$	2,840	$	2,239
Increase (decrease) resulting from:
Benefit of S Corporation status	—		(2,239)
State taxes	1,157		382


Other	(337)		—
Provision for income taxes	$	3,660	$	382

Shareholders’ Equity (Tables)

3 Months Ended

Mar. 31, 2022

Equity [Abstract]

Nonvested Restricted Stock Shares

The following table summarizes information about unvested restricted shares:


	For the three months ended March 31,
	2022			2021
	Shares	Weighted Average Grant Date Fair Value		Shares	Weighted Average Grant Date Fair Value
Beginning of the period balance	127,751	$	19.95	11,568	$	21.25
Shares granted	22,201	28.50		9,454	18.00
Shares vested	(10,246)	24.85		(12,004)	20.45
Shares forfeited	(850)	20.00		(2,722)	18.88
End of the period balance	138,856	$	20.95	6,296	$	18.91

Commitments and Contingencies (Tables)

3 Months Ended

Mar. 31, 2022

Commitments and Contingencies Disclosure [Abstract]

Schedule of Other Commitments

The contractual amounts of unfunded loan commitments and standby letters of credit not reflected in the consolidated balance sheets are as follows:


(in thousands)	March 31, 2022		December 31, 2021
Commercial lines of credit	$	116,857	$	137,354
Undisbursed construction loans	48,918		46,584
Undisbursed commercial real estate loans	65,592		47,793
Agricultural lines of credit	11,608		9,955
Undisbursed agricultural real estate loans	3,428		3,427
Other	3,040		3,764
Total commitments and standby letters of credit	$	249,443	$	248,877

Basis of Presentation - Narrative (Details) - USD ($) $ / shares in Units, $ in Millions			3 Months Ended
	May 07, 2021	May 05, 2021	Mar. 31, 2022	Mar. 31, 2021
Subsidiary, Sale of Stock [Line Items]
Sale of stock, price per share (in usd per share)	$ 20.00
Proceeds from issuance initial public offering	$ 111.2
Sale of stock, consideration received on transaction	$ 109.1
Effective/pro forma tax rate		29.56%	27.07%	29.56%
IPO
Subsidiary, Sale of Stock [Line Items]
Number of shares sold (in shares)		6,054,750
Over-Allotment Option
Subsidiary, Sale of Stock [Line Items]
Number of shares sold (in shares)	789,750

Basis of Presentation - Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Net income	$ 9,862	$ 10,278
Weighted average basic common shares outstanding (in shares)	17,102,508	10,998,041
Add: Dilutive effects of assumed vesting of restricted stock (in shares)	62,011	0
Weighted average diluted common shares outstanding (in shares)	17,164,519	10,998,041
Income per common share:
Basic EPS (in USD per share)	$ 0.58	$ 0.93
Diluted EPS (in USD per share)	$ 0.58	$ 0.93

- Definition

The amount of net income (loss) for the period per each share of common stock or unit outstanding during the reporting period.

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The amount of net income (loss) for the period available to each share of common stock or common unit outstanding during the reporting period and to each share or unit that would have been outstanding assuming the issuance of common shares or units for all dilutive potential common shares or units outstanding during the reporting period.

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-Section 50
-Paragraph 1
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=124432515&loc=d3e3550-109257

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 944
-SubTopic 220
-Section S99
-Paragraph 1
-Subparagraph (SX 210.7-04(23))
-URI http://asc.fasb.org/extlink&oid=120400993&loc=SL114874131-224263

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 250
-SubTopic 10
-Section 50
-Paragraph 11
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=124431687&loc=d3e22694-107794

Reference 14: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 260
-SubTopic 10
-Section 45
-Paragraph 7
-URI http://asc.fasb.org/extlink&oid=125511455&loc=d3e1337-109256

Reference 15: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 815
-SubTopic 40
-Section 65
-Paragraph 1
-Subparagraph (e)(4)
-URI http://asc.fasb.org/extlink&oid=123482062&loc=SL123482106-238011

Reference 16: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 220
-SubTopic 10
-Section S99
-Paragraph 2
-Subparagraph (SX 210.5-03(25))
-URI http://asc.fasb.org/extlink&oid=123367319&loc=SL114868664-224227

+ Details

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

+ References

+ Details

Basis of Presentation - Pro Forma EPS (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Net income before provision for income taxes - GAAP	$ 13,522	$ 10,660
Less: Actual/pro forma provision for income taxes	3,660	3,151
Actual/pro forma net income	$ 9,862	$ 7,509
Weighted average basic common shares outstanding (in shares)	17,102,508	10,998,041
Add: Dilutive effects of assumed vesting of restricted stock (in shares)	62,011	0
Weighted average diluted common shares outstanding (in shares)	17,164,519	10,998,041
Income per common share:
Basic EPS (actual/pro forma) (in USD per share)	$ 0.58	$ 0.68
Diluted EPS (actual/pro forma) (in USD per share)	$ 0.58	$ 0.68

Fair Value of Assets and Liabilities - Fair Value of Assets and Liabilities Measured on Recurring Basis (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities available-for-sale, at fair value	$ 134,813	$ 148,807
Carrying Value \| Significant Other Observable Inputs (Level 2)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities available-for-sale, at fair value	134,813	148,807
Assets: \| U.S. government agencies, mortgage-backed securities, obligations of states and political subdivisions, collateralized mortgage obligations, and corporate bonds \| Fair Value, Recurring
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities available-for-sale, at fair value	134,813	148,807
Assets: \| U.S. government agencies, mortgage-backed securities, obligations of states and political subdivisions, collateralized mortgage obligations, and corporate bonds \| Fair Value, Recurring \| Quoted Prices in Active Markets for Identical Assets (Level 1)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities available-for-sale, at fair value	0	0
Assets: \| U.S. government agencies, mortgage-backed securities, obligations of states and political subdivisions, collateralized mortgage obligations, and corporate bonds \| Fair Value, Recurring \| Significant Other Observable Inputs (Level 2)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities available-for-sale, at fair value	134,813	148,807
Assets: \| U.S. government agencies, mortgage-backed securities, obligations of states and political subdivisions, collateralized mortgage obligations, and corporate bonds \| Fair Value, Recurring \| Significant Unobservable Inputs (Level 3)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities available-for-sale, at fair value	0	0
Assets: \| Derivatives – interest rate swap \| Fair Value, Recurring
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivatives – interest rate swap	58	92
Assets: \| Derivatives – interest rate swap \| Fair Value, Recurring \| Quoted Prices in Active Markets for Identical Assets (Level 1)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivatives – interest rate swap	0	0
Assets: \| Derivatives – interest rate swap \| Fair Value, Recurring \| Significant Other Observable Inputs (Level 2)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivatives – interest rate swap	58	92
Assets: \| Derivatives – interest rate swap \| Fair Value, Recurring \| Significant Unobservable Inputs (Level 3)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivatives – interest rate swap	0	0
Liabilities: \| Derivatives – interest rate swap \| Fair Value, Recurring
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivatives – interest rate swap	58	92
Liabilities: \| Derivatives – interest rate swap \| Fair Value, Recurring \| Quoted Prices in Active Markets for Identical Assets (Level 1)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivatives – interest rate swap	0	0
Liabilities: \| Derivatives – interest rate swap \| Fair Value, Recurring \| Significant Other Observable Inputs (Level 2)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivatives – interest rate swap	58	92
Liabilities: \| Derivatives – interest rate swap \| Fair Value, Recurring \| Significant Unobservable Inputs (Level 3)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivatives – interest rate swap	$ 0	$ 0

Fair Value of Assets and Liabilities - Fair Value Estimates for Financial Instruments by Balance Sheet Grouping (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Financial assets:
Securities available-for-sale, at fair value	$ 134,813	$ 148,807
Securities held-to-maturity	4,459	5,197
Carrying Amounts
Financial assets:
Cash and cash equivalents	504,964	425,329
Time deposits in banks	14,464	14,464
Securities available-for-sale, at fair value	134,813	148,807
Securities held-to-maturity	4,486	4,946
Loans held for sale	10,386	10,671
Loans held for investment, net of allowance for loan losses	2,056,254	1,911,217
FHLB stock and other investments	12,383	12,464
Interest receivable	5,547	5,332
Interest rate swap	58	92
Financial liabilities:
Deposits	2,503,092	2,285,890
Interest payable	79	23
Interest rate swap	58	92
Subordinated notes	28,403	28,386
Fair Value \| Quoted Prices in Active Markets for Identical Assets (Level 1)
Financial assets:
Cash and cash equivalents	504,964	425,329
Time deposits in banks	14,464	14,464
Fair Value \| Significant Other Observable Inputs (Level 2)
Financial assets:
Securities available-for-sale, at fair value	134,813	148,807
Loans held for sale	11,063	11,217
Interest receivable	5,547	5,332
Interest rate swap	58	92
Financial liabilities:
Deposits	2,349,536	2,210,555
Interest payable	79	23
Interest rate swap	58	92
Fair Value \| Significant Unobservable Inputs (Level 3)
Financial assets:
Securities held-to-maturity	4,459	5,197
Loans held for investment, net of allowance for loan losses	1,993,626	1,893,431
Financial liabilities:
Subordinated notes	$ 28,403	$ 28,386

Investment Securities - Amortized Cost and Fair Value of Securities Held-to-maturity (Details) - USD ($) $ in Thousands	3 Months Ended	12 Months Ended
	Mar. 31, 2022	Dec. 31, 2021
Marketable Securities [Line Items]
Securities held-to-maturity, at carrying value	$ 4,486	$ 4,946
Gross unrealized gains	0	251
Gross unrealized losses	(27)	0
Securities held-to-maturity	4,459	5,197
Obligations of states and political subdivisions
Marketable Securities [Line Items]
Securities held-to-maturity, at carrying value	4,486	4,946
Gross unrealized gains	0	251
Gross unrealized losses	(27)	0
Securities held-to-maturity	$ 4,459	$ 5,197

Investment Securities - Amortized Cost and Fair Value of Securities Available-for-sale (Details) - USD ($) $ in Thousands	3 Months Ended	12 Months Ended
	Mar. 31, 2022	Dec. 31, 2021
Marketable Securities [Line Items]
Amortized Cost	$ 145,060	$ 149,610
Gross unrealized gains	126	682
Gross unrealized losses	(10,373)	(1,485)
Fair Value	134,813	148,807
U.S. government agencies
Marketable Securities [Line Items]
Amortized Cost	18,241	19,824
Gross unrealized gains	95	60
Gross unrealized losses	(257)	(202)
Fair Value	18,079	19,682
Mortgage-backed securities
Marketable Securities [Line Items]
Amortized Cost	79,694	82,517
Gross unrealized gains	8	94
Gross unrealized losses	(6,210)	(1,098)
Fair Value	73,492	81,513
Obligations of states and political subdivisions
Marketable Securities [Line Items]
Amortized Cost	44,621	44,732
Gross unrealized gains	23	525
Gross unrealized losses	(3,713)	(120)
Fair Value	40,931	45,137
Collateralized mortgage obligations
Marketable Securities [Line Items]
Amortized Cost	504	537
Gross unrealized gains	0	3
Gross unrealized losses	(21)	0
Fair Value	483	540
Corporate bonds
Marketable Securities [Line Items]
Amortized Cost	2,000	2,000
Gross unrealized gains	0	0
Gross unrealized losses	(172)	(65)
Fair Value	$ 1,828	$ 1,935

Investment Securities - Amortized Cost and Fair Value of Investment Debt Securities by Contractual Maturity (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Amortized Cost
Within one year	$ 456	$ 491
After one but within five years	1,115	951
After five years through ten years	1,590	3,504
After ten years	1,325	0
Fair Value
Within one year	454	516
After one but within five years	1,108	999
After five years through ten years	1,580	3,682
After ten years	1,317	0
Amortized Cost
Within one year	0	0
After one but within five years	505	507
After five years through ten years	3,684	3,697
After ten years	40,432	40,528
Fair Value
Within one year	0	0
After one but within five years	514	522
After five years through ten years	3,458	3,748
After ten years	36,959	40,867
Securities held-to-maturity, at carrying value	4,486	4,946
Securities held-to-maturity	4,459	5,197
Securities available-for-sale, at amortized cost	145,060	149,610
Securities available-for-sale, at fair value	134,813	148,807
U.S. government agencies
Fair Value
Securities held-to-maturity, at carrying value	0	0
Securities held-to-maturity	0	0
Securities available-for-sale, at amortized cost	18,241	19,824
Securities available-for-sale, at fair value	18,079	19,682
Mortgage-backed securities
Fair Value
Securities held-to-maturity, at carrying value	0	0
Securities held-to-maturity	0	0
Securities available-for-sale, at amortized cost	79,694	82,517
Securities available-for-sale, at fair value	73,492	81,513
Collateralized mortgage obligations
Fair Value
Securities held-to-maturity, at carrying value	0	0
Securities held-to-maturity	0	0
Securities available-for-sale, at amortized cost	504	537
Securities available-for-sale, at fair value	483	540
Corporate bonds
Fair Value
Securities held-to-maturity, at carrying value	0	0
Securities held-to-maturity	0	0
Securities available-for-sale, at amortized cost	2,000	2,000
Securities available-for-sale, at fair value	$ 1,828	$ 1,935

Investment Securities - Sales of Investment Securities (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Investments, Debt and Equity Securities [Abstract]
Sales proceeds	$ 1,623	$ 11,456
Gross realized gains	$ 5	$ 182

Investment Securities - Pledged Investment Securities (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Total pledged investment securities	$ 57,423	$ 63,363
CALIFORNIA
Total pledged investment securities	$ 57,423	$ 63,363

Investment Securities - Available-for-sale Securities in a Continuous Unrealized Loss Position (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Marketable Securities [Line Items]
Less than twelve continuous months, fair value	$ 104,479	$ 89,921
Less than twelve continuous months, unrealized loss	(8,932)	(1,223)
Twelve continuous months or longer, fair value	25,131	15,206
Twelve continuous months or longer, unrealized loss	(1,441)	(262)
Total securities in a loss position, fair value	129,610	105,127
Total securities in a loss position, unrealized loss	(10,373)	(1,485)
U.S. government agencies
Marketable Securities [Line Items]
Less than twelve continuous months, fair value	2,275	0
Less than twelve continuous months, unrealized loss	(77)	0
Twelve continuous months or longer, fair value	12,371	13,399
Twelve continuous months or longer, unrealized loss	(180)	(202)
Total securities in a loss position, fair value	14,646	13,399
Total securities in a loss position, unrealized loss	(257)	(202)
Mortgage-backed securities
Marketable Securities [Line Items]
Less than twelve continuous months, fair value	62,090	73,972
Less than twelve continuous months, unrealized loss	(5,122)	(1,046)
Twelve continuous months or longer, fair value	10,969	1,400
Twelve continuous months or longer, unrealized loss	(1,088)	(52)
Total securities in a loss position, fair value	73,059	75,372
Total securities in a loss position, unrealized loss	(6,210)	(1,098)
Obligations of states and political subdivisions
Marketable Securities [Line Items]
Less than twelve continuous months, fair value	37,803	14,014
Less than twelve continuous months, unrealized loss	(3,540)	(112)
Twelve continuous months or longer, fair value	1,791	407
Twelve continuous months or longer, unrealized loss	(173)	(8)
Total securities in a loss position, fair value	39,594	14,421
Total securities in a loss position, unrealized loss	(3,713)	(120)
Collateralized mortgage obligations
Marketable Securities [Line Items]
Less than twelve continuous months, fair value	483
Less than twelve continuous months, unrealized loss	(21)
Twelve continuous months or longer, fair value	0
Twelve continuous months or longer, unrealized loss	0
Total securities in a loss position, fair value	483
Total securities in a loss position, unrealized loss	(21)
Corporate bonds
Marketable Securities [Line Items]
Less than twelve continuous months, fair value	1,828	1,935
Less than twelve continuous months, unrealized loss	(172)	(65)
Twelve continuous months or longer, fair value	0	0
Twelve continuous months or longer, unrealized loss	0	0
Total securities in a loss position, fair value	1,828	1,935
Total securities in a loss position, unrealized loss	$ (172)	$ (65)

Investment Securities - Narrative (Details) $ / shares in Units, $ in Thousands	3 Months Ended
	Mar. 31, 2022 USD ($) security $ / shares	Mar. 31, 2021 USD ($)	Dec. 31, 2021 USD ($) security
Marketable Securities [Line Items]
Number of securities in unrealized loss positions \| security	150		91
Number of investment securities in a continuous loss position for twelve months or more \| security	24
Investment securities in a loss position for less than twelve months	126
Held-to-maturity securities in a continuous loss position for twelve months or less \| security	1		0
FHLB stock price (in USD per share) \| $ / shares	$ 100
FHLB Stock	$ 6,667		$ 6,723
Investment interest rate	6.00%
Noninterest income	$ 2,185	$ 1,616
FHLB stock dividends	100	$ 78
Investment in Federal Home Loan Bank Stock
Marketable Securities [Line Items]
FHLB stock dividends	$ 102

Loans and Allowance for Loan Losses - Narrative (Details)	3 Months Ended
	Mar. 31, 2022 USD ($) borrowingRelationship loan	Mar. 31, 2021 USD ($)	Dec. 31, 2021 USD ($)
Financing Receivable, Past Due [Line Items]
Loans held for investment, net of allowance for loan losses	$ 2,056,254,000		$ 1,911,217,000
Loans greater than 90 days past due	0		0
Interest income related to non-accrual loans	$ 18,300	$ 6,800
Number of borrowing relationships, subject to deferment, CARES act \| borrowingRelationship	6
Number of loans, subject to deferment, CARES act \| loan	6
Loans and leases receivable, subject to deferment, CARES act	$ 12,200,000
Pledged loans	1,200,000,000		941,200,000
Total commitments and standby letters of credit	249,443,000		248,877,000
Unfunded Loan Commitment \| Affiliated Entity
Financing Receivable, Past Due [Line Items]
Total commitments and standby letters of credit	8,900,000		9,700,000
FHLB of San Francisco
Financing Receivable, Past Due [Line Items]
Pledged loans	29,700,000		33,400,000
60 - 89 Days
Financing Receivable, Past Due [Line Items]
Loans between 60-89 days past due	$ 0		$ 0

Loans and Allowance for Loan Losses - Balance of Each Major Product Type (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021	Mar. 31, 2021	Dec. 31, 2020
Financing Receivable, Past Due [Line Items]
Loans held for investment	$ 2,081,399	$ 1,936,066
Less: Net deferred loan fees	1,241	1,606
Less: Allowance for loan losses	23,904	23,243	$ 22,271	$ 22,189
Loans held for investment, net of allowance for loan losses	2,056,254	1,911,217
Commercial
Financing Receivable, Past Due [Line Items]
Loans held for investment	1,760,551	1,586,232
Less: Allowance for loan losses	13,868	12,869	10,219	9,358
Commercial land and development
Financing Receivable, Past Due [Line Items]
Loans held for investment	9,090	7,376
Less: Allowance for loan losses	66	50	80	77
Commercial construction
Financing Receivable, Past Due [Line Items]
Loans held for investment	59,293	54,214
Less: Allowance for loan losses	430	371	504	821
Residential construction
Financing Receivable, Past Due [Line Items]
Loans held for investment	5,540	7,388
Less: Allowance for loan losses	40	50	57	87
Residential
Financing Receivable, Past Due [Line Items]
Loans held for investment	28,921	28,562
Less: Allowance for loan losses	208	192	188	220
Farmland
Financing Receivable, Past Due [Line Items]
Loans held for investment	49,903	54,805
Less: Allowance for loan losses	611	645	578	615
Secured
Financing Receivable, Past Due [Line Items]
Loans held for investment	124,930	137,062
Less: Allowance for loan losses	7,039	6,859	8,918	9,476
Unsecured
Financing Receivable, Past Due [Line Items]
Loans held for investment	22,599	21,136
Less: Allowance for loan losses	246	207	195	179
Paycheck Protection Program (“PPP”)
Financing Receivable, Past Due [Line Items]
Loans held for investment	1,528	22,124
Less: Allowance for loan losses	0	0	0	0
Consumer and other
Financing Receivable, Past Due [Line Items]
Loans held for investment	19,044	17,167
Less: Allowance for loan losses	$ 1,088	$ 889	$ 600	$ 632

Loans and Allowance for Loan Losses - Credit Quality Indicators Related to the Company’s Loans by Class (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Financing Receivable, Past Due [Line Items]
Total	$ 2,081,399	$ 1,936,066
Pass
Financing Receivable, Past Due [Line Items]
Total	2,064,388	1,916,805
Watch
Financing Receivable, Past Due [Line Items]
Total	14,001	8,647
Substandard
Financing Receivable, Past Due [Line Items]
Total	3,010	10,614
Doubtful
Financing Receivable, Past Due [Line Items]
Total	0	0
Commercial
Financing Receivable, Past Due [Line Items]
Total	1,760,551	1,586,232
Commercial \| Pass
Financing Receivable, Past Due [Line Items]
Total	1,751,563	1,575,006
Commercial \| Watch
Financing Receivable, Past Due [Line Items]
Total	8,087	1,970
Commercial \| Substandard
Financing Receivable, Past Due [Line Items]
Total	901	9,256
Commercial \| Doubtful
Financing Receivable, Past Due [Line Items]
Total	0	0
Commercial land and development
Financing Receivable, Past Due [Line Items]
Total	9,090	7,376
Commercial land and development \| Pass
Financing Receivable, Past Due [Line Items]
Total	9,090	7,376
Commercial land and development \| Watch
Financing Receivable, Past Due [Line Items]
Total	0	0
Commercial land and development \| Substandard
Financing Receivable, Past Due [Line Items]
Total	0	0
Commercial land and development \| Doubtful
Financing Receivable, Past Due [Line Items]
Total	0	0
Commercial construction
Financing Receivable, Past Due [Line Items]
Total	59,293	54,214
Commercial construction \| Pass
Financing Receivable, Past Due [Line Items]
Total	53,393	48,288
Commercial construction \| Watch
Financing Receivable, Past Due [Line Items]
Total	5,900	5,926
Commercial construction \| Substandard
Financing Receivable, Past Due [Line Items]
Total	0	0
Commercial construction \| Doubtful
Financing Receivable, Past Due [Line Items]
Total	0	0
Residential construction
Financing Receivable, Past Due [Line Items]
Total	5,540	7,388
Residential construction \| Pass
Financing Receivable, Past Due [Line Items]
Total	5,540	7,388
Residential construction \| Watch
Financing Receivable, Past Due [Line Items]
Total	0	0
Residential construction \| Substandard
Financing Receivable, Past Due [Line Items]
Total	0	0
Residential construction \| Doubtful
Financing Receivable, Past Due [Line Items]
Total	0	0
Residential
Financing Receivable, Past Due [Line Items]
Total	28,921	28,562
Residential \| Pass
Financing Receivable, Past Due [Line Items]
Total	28,744	28,384
Residential \| Watch
Financing Receivable, Past Due [Line Items]
Total	0	0
Residential \| Substandard
Financing Receivable, Past Due [Line Items]
Total	177	178
Residential \| Doubtful
Financing Receivable, Past Due [Line Items]
Total	0	0
Farmland
Financing Receivable, Past Due [Line Items]
Total	49,903	54,805
Farmland \| Pass
Financing Receivable, Past Due [Line Items]
Total	49,903	54,805
Farmland \| Watch
Financing Receivable, Past Due [Line Items]
Total	0	0
Farmland \| Substandard
Financing Receivable, Past Due [Line Items]
Total	0	0
Farmland \| Doubtful
Financing Receivable, Past Due [Line Items]
Total	0	0
Secured
Financing Receivable, Past Due [Line Items]
Total	124,930	137,062
Secured \| Pass
Financing Receivable, Past Due [Line Items]
Total	122,996	135,131
Secured \| Watch
Financing Receivable, Past Due [Line Items]
Total	14	751
Secured \| Substandard
Financing Receivable, Past Due [Line Items]
Total	1,920	1,180
Secured \| Doubtful
Financing Receivable, Past Due [Line Items]
Total	0	0
Unsecured
Financing Receivable, Past Due [Line Items]
Total	22,599	21,136
Unsecured \| Pass
Financing Receivable, Past Due [Line Items]
Total	22,599	21,136
Unsecured \| Watch
Financing Receivable, Past Due [Line Items]
Total	0	0
Unsecured \| Substandard
Financing Receivable, Past Due [Line Items]
Total	0	0
Unsecured \| Doubtful
Financing Receivable, Past Due [Line Items]
Total	0	0
Paycheck Protection Program (“PPP”)
Financing Receivable, Past Due [Line Items]
Total	1,528	22,124
Paycheck Protection Program (“PPP”) \| Pass
Financing Receivable, Past Due [Line Items]
Total	1,528	22,124
Paycheck Protection Program (“PPP”) \| Watch
Financing Receivable, Past Due [Line Items]
Total	0	0
Paycheck Protection Program (“PPP”) \| Substandard
Financing Receivable, Past Due [Line Items]
Total	0	0
Paycheck Protection Program (“PPP”) \| Doubtful
Financing Receivable, Past Due [Line Items]
Total	0	0
Consumer and other
Financing Receivable, Past Due [Line Items]
Total	19,044	17,167
Consumer and other \| Pass
Financing Receivable, Past Due [Line Items]
Total	19,032	17,167
Consumer and other \| Watch
Financing Receivable, Past Due [Line Items]
Total	0	0
Consumer and other \| Substandard
Financing Receivable, Past Due [Line Items]
Total	12	0
Consumer and other \| Doubtful
Financing Receivable, Past Due [Line Items]
Total	$ 0	$ 0

Loans and Allowance for Loan Losses - Age Analysis of Past Due Loans by Class (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Financing Receivable, Past Due [Line Items]
Total	$ 2,081,399	$ 1,936,066
30-89 Days
Financing Receivable, Past Due [Line Items]
Total	549	334
Greater Than 90 Days
Financing Receivable, Past Due [Line Items]
Total	0	0
Total Past Due
Financing Receivable, Past Due [Line Items]
Total	549	334
Current
Financing Receivable, Past Due [Line Items]
Total	2,080,850	1,935,732
Commercial
Financing Receivable, Past Due [Line Items]
Total	1,760,551	1,586,232
Commercial \| 30-89 Days
Financing Receivable, Past Due [Line Items]
Total	0	0
Commercial \| Greater Than 90 Days
Financing Receivable, Past Due [Line Items]
Total	0	0
Commercial \| Total Past Due
Financing Receivable, Past Due [Line Items]
Total	0	0
Commercial \| Current
Financing Receivable, Past Due [Line Items]
Total	1,760,551	1,586,232
Commercial land and development
Financing Receivable, Past Due [Line Items]
Total	9,090	7,376
Commercial land and development \| 30-89 Days
Financing Receivable, Past Due [Line Items]
Total	0	0
Commercial land and development \| Greater Than 90 Days
Financing Receivable, Past Due [Line Items]
Total	0	0
Commercial land and development \| Total Past Due
Financing Receivable, Past Due [Line Items]
Total	0	0
Commercial land and development \| Current
Financing Receivable, Past Due [Line Items]
Total	9,090	7,376
Commercial construction
Financing Receivable, Past Due [Line Items]
Total	59,293	54,214
Commercial construction \| 30-89 Days
Financing Receivable, Past Due [Line Items]
Total	0	0
Commercial construction \| Greater Than 90 Days
Financing Receivable, Past Due [Line Items]
Total	0	0
Commercial construction \| Total Past Due
Financing Receivable, Past Due [Line Items]
Total	0	0
Commercial construction \| Current
Financing Receivable, Past Due [Line Items]
Total	59,293	54,214
Residential construction
Financing Receivable, Past Due [Line Items]
Total	5,540	7,388
Residential construction \| 30-89 Days
Financing Receivable, Past Due [Line Items]
Total	0	0
Residential construction \| Greater Than 90 Days
Financing Receivable, Past Due [Line Items]
Total	0	0
Residential construction \| Total Past Due
Financing Receivable, Past Due [Line Items]
Total	0	0
Residential construction \| Current
Financing Receivable, Past Due [Line Items]
Total	5,540	7,388
Residential
Financing Receivable, Past Due [Line Items]
Total	28,921	28,562
Residential \| 30-89 Days
Financing Receivable, Past Due [Line Items]
Total	0	0
Residential \| Greater Than 90 Days
Financing Receivable, Past Due [Line Items]
Total	0	0
Residential \| Total Past Due
Financing Receivable, Past Due [Line Items]
Total	0	0
Residential \| Current
Financing Receivable, Past Due [Line Items]
Total	28,921	28,562
Farmland
Financing Receivable, Past Due [Line Items]
Total	49,903	54,805
Farmland \| 30-89 Days
Financing Receivable, Past Due [Line Items]
Total	0	0
Farmland \| Greater Than 90 Days
Financing Receivable, Past Due [Line Items]
Total	0	0
Farmland \| Total Past Due
Financing Receivable, Past Due [Line Items]
Total	0	0
Farmland \| Current
Financing Receivable, Past Due [Line Items]
Total	49,903	54,805
Secured
Financing Receivable, Past Due [Line Items]
Total	124,930	137,062
Secured \| 30-89 Days
Financing Receivable, Past Due [Line Items]
Total	422	0
Secured \| Greater Than 90 Days
Financing Receivable, Past Due [Line Items]
Total	0	0
Secured \| Total Past Due
Financing Receivable, Past Due [Line Items]
Total	422	0
Secured \| Current
Financing Receivable, Past Due [Line Items]
Total	124,508	137,062
Unsecured
Financing Receivable, Past Due [Line Items]
Total	22,599	21,136
Unsecured \| 30-89 Days
Financing Receivable, Past Due [Line Items]
Total	0	0
Unsecured \| Greater Than 90 Days
Financing Receivable, Past Due [Line Items]
Total	0	0
Unsecured \| Total Past Due
Financing Receivable, Past Due [Line Items]
Total	0	0
Unsecured \| Current
Financing Receivable, Past Due [Line Items]
Total	22,599	21,136
Paycheck Protection Program (“PPP”)
Financing Receivable, Past Due [Line Items]
Total	1,528	22,124
Paycheck Protection Program (“PPP”) \| 30-89 Days
Financing Receivable, Past Due [Line Items]
Total	0	0
Paycheck Protection Program (“PPP”) \| Greater Than 90 Days
Financing Receivable, Past Due [Line Items]
Total	0	0
Paycheck Protection Program (“PPP”) \| Total Past Due
Financing Receivable, Past Due [Line Items]
Total	0	0
Paycheck Protection Program (“PPP”) \| Current
Financing Receivable, Past Due [Line Items]
Total	1,528	22,124
Consumer and other
Financing Receivable, Past Due [Line Items]
Total	19,044	17,167
Consumer and other \| 30-89 Days
Financing Receivable, Past Due [Line Items]
Total	127	334
Consumer and other \| Greater Than 90 Days
Financing Receivable, Past Due [Line Items]
Total	0	0
Consumer and other \| Total Past Due
Financing Receivable, Past Due [Line Items]
Total	127	334
Consumer and other \| Current
Financing Receivable, Past Due [Line Items]
Total	$ 18,917	$ 16,833

Loans and Allowance for Loan Losses - Impaired Loans (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021	Dec. 31, 2021
Recorded Investment
Recorded Investment, With no related allowance recorded	$ 418		$ 416
Recorded Investment, With an allowance recorded	922		172
Recorded Investment, Total	1,340		588
Unpaid Principal Balance
Unpaid Principal Balance, With no related allowance recorded	418		416
Unpaid Principal Balance, With an allowance recorded	922		172
Unpaid Principal Balance, Total	1,340		588
Related Allowance	639		172
Average Recorded Investment
Average Recorded Investment, With no related allowance recorded	497	$ 447
Average Recorded Investment, With an allowance recorded	947	36
Average Recorded Investment, Total	1,444	483
Interest Income Recognized
Interest Income Recognized, With no related allowance recorded	0	0
Interest Income Recognized, With an allowance recorded	0	0
Interest Income Recognized, Total	0	0
Commercial
Recorded Investment
Recorded Investment, With no related allowance recorded	118		122
Recorded Investment, Total	118		122
Unpaid Principal Balance
Unpaid Principal Balance, With no related allowance recorded	118		122
Unpaid Principal Balance, Total	118		122
Related Allowance	0		0
Average Recorded Investment
Average Recorded Investment, With no related allowance recorded	120	136
Average Recorded Investment, Total	120	136
Interest Income Recognized
Interest Income Recognized, With no related allowance recorded	0	0
Interest Income Recognized, Total	0	0
Residential
Recorded Investment
Recorded Investment, With no related allowance recorded	177		178
Recorded Investment, Total	177		178
Unpaid Principal Balance
Unpaid Principal Balance, With no related allowance recorded	177		178
Unpaid Principal Balance, Total	177		178
Related Allowance	0		0
Average Recorded Investment
Average Recorded Investment, With no related allowance recorded	178	182
Average Recorded Investment, Total	178	182
Interest Income Recognized
Interest Income Recognized, With no related allowance recorded	0	0
Interest Income Recognized, Total	0	0
Secured
Recorded Investment
Recorded Investment, With no related allowance recorded	111		116
Recorded Investment, With an allowance recorded	922		172
Recorded Investment, Total	1,033		288
Unpaid Principal Balance
Unpaid Principal Balance, With no related allowance recorded	111		116
Unpaid Principal Balance, With an allowance recorded	922		172
Unpaid Principal Balance, Total	1,033		288
Related Allowance	639		172
Average Recorded Investment
Average Recorded Investment, With no related allowance recorded	174	129
Average Recorded Investment, With an allowance recorded	947	0
Average Recorded Investment, Total	1,121	129
Interest Income Recognized
Interest Income Recognized, With no related allowance recorded	0	0
Interest Income Recognized, With an allowance recorded	0	0
Interest Income Recognized, Total	0	0
Consumer and other
Recorded Investment
Recorded Investment, With no related allowance recorded	12		0
Recorded Investment, Total	12		0
Unpaid Principal Balance
Unpaid Principal Balance, With no related allowance recorded	12		0
Unpaid Principal Balance, Total	12		0
Related Allowance	0		$ 0
Average Recorded Investment
Average Recorded Investment, With no related allowance recorded	25	0
Average Recorded Investment, With an allowance recorded	0	36
Average Recorded Investment, Total	25	36
Interest Income Recognized
Interest Income Recognized, With no related allowance recorded	0	0
Interest Income Recognized, With an allowance recorded	0	0
Interest Income Recognized, Total	$ 0	$ 0

Loans and Allowance for Loan Losses - Non-accrual Loans Segregated by Class (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Financing Receivable, Past Due [Line Items]
Total non-accrual loans	$ 1,328	$ 588
Commercial
Financing Receivable, Past Due [Line Items]
Total non-accrual loans	118	122
Residential
Financing Receivable, Past Due [Line Items]
Total non-accrual loans	177	178
Secured
Financing Receivable, Past Due [Line Items]
Total non-accrual loans	$ 1,033	$ 288

Loans and Allowance for Loan Losses - Allowance for Loan Losses (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021	Dec. 31, 2021
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Beginning balance	$ 23,243	$ 22,189
Charge-offs	(376)	(255)
Recoveries	87	137
Provision (recapture)	950	200
Ending balance	23,904	22,271
Loans individually evaluated for impairment	639		$ 172
Loans collectively evaluated for impairment	23,265		23,071
Ending balance	23,904		23,243
Loans:
Ending balance individually evaluated for impairment	1,341		588
Ending balance collectively evaluated for impairment	2,080,058		1,935,478
Loans held for investment	2,081,399		1,936,066
Commercial
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Beginning balance	12,869	9,358
Charge-offs	0	0
Recoveries	0	0
Provision (recapture)	999	861
Ending balance	13,868	10,219
Loans individually evaluated for impairment	0		0
Loans collectively evaluated for impairment	13,868		12,869
Ending balance	13,868		12,869
Loans:
Ending balance individually evaluated for impairment	118		122
Ending balance collectively evaluated for impairment	1,760,433		1,586,110
Loans held for investment	1,760,551		1,586,232
Commercial land and development
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Beginning balance	50	77
Charge-offs	0	0
Recoveries	0	0
Provision (recapture)	16	3
Ending balance	66	80
Loans individually evaluated for impairment	0		0
Loans collectively evaluated for impairment	66		50
Ending balance	66		50
Loans:
Ending balance individually evaluated for impairment	0		0
Ending balance collectively evaluated for impairment	9,090		7,376
Loans held for investment	9,090		7,376
Commercial construction
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Beginning balance	371	821
Charge-offs	0	0
Recoveries	0	0
Provision (recapture)	59	(317)
Ending balance	430	504
Loans individually evaluated for impairment	0		0
Loans collectively evaluated for impairment	430		371
Ending balance	430		371
Loans:
Ending balance individually evaluated for impairment	0		0
Ending balance collectively evaluated for impairment	59,293		54,214
Loans held for investment	59,293		54,214
Residential construction
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Beginning balance	50	87
Charge-offs	0	0
Recoveries	0	0
Provision (recapture)	(10)	(30)
Ending balance	40	57
Loans individually evaluated for impairment	0		0
Loans collectively evaluated for impairment	40		50
Ending balance	40		50
Loans:
Ending balance individually evaluated for impairment	0		0
Ending balance collectively evaluated for impairment	5,540		7,388
Loans held for investment	5,540		7,388
Residential
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Beginning balance	192	220
Charge-offs	0	0
Recoveries	0	0
Provision (recapture)	16	(32)
Ending balance	208	188
Loans individually evaluated for impairment	0		0
Loans collectively evaluated for impairment	208		192
Ending balance	208		192
Loans:
Ending balance individually evaluated for impairment	177		178
Ending balance collectively evaluated for impairment	28,744		28,384
Loans held for investment	28,921		28,562
Farmland
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Beginning balance	645	615
Charge-offs	0	0
Recoveries	0	0
Provision (recapture)	(34)	(37)
Ending balance	611	578
Loans individually evaluated for impairment	0		0
Loans collectively evaluated for impairment	611		645
Ending balance	611		645
Loans:
Ending balance individually evaluated for impairment	0		0
Ending balance collectively evaluated for impairment	49,903		54,805
Loans held for investment	49,903		54,805
Secured
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Beginning balance	6,859	9,476
Charge-offs	(309)	(255)
Recoveries	46	87
Provision (recapture)	443	(390)
Ending balance	7,039	8,918
Loans individually evaluated for impairment	639		172
Loans collectively evaluated for impairment	6,400		6,687
Ending balance	7,039		6,859
Loans:
Ending balance individually evaluated for impairment	1,034		288
Ending balance collectively evaluated for impairment	123,896		136,774
Loans held for investment	124,930		137,062
Unsecured
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Beginning balance	207	179
Charge-offs	0	0
Recoveries	0	0
Provision (recapture)	39	16
Ending balance	246	195
Loans individually evaluated for impairment	0		0
Loans collectively evaluated for impairment	246		207
Ending balance	246		207
Loans:
Ending balance individually evaluated for impairment	0		0
Ending balance collectively evaluated for impairment	22,599		21,136
Loans held for investment	22,599		21,136
Paycheck Protection Program (“PPP”)
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Beginning balance	0	0
Charge-offs	0	0
Recoveries	0	0
Provision (recapture)	0	0
Ending balance	0	0
Loans individually evaluated for impairment	0		0
Loans collectively evaluated for impairment	0		0
Ending balance	0		0
Loans:
Ending balance individually evaluated for impairment	0		0
Ending balance collectively evaluated for impairment	1,528		22,124
Loans held for investment	1,528		22,124
Consumer and other
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Beginning balance	889	632
Charge-offs	(67)	0
Recoveries	41	50
Provision (recapture)	225	(82)
Ending balance	1,088	600
Loans individually evaluated for impairment	0		0
Loans collectively evaluated for impairment	1,088		889
Ending balance	1,088		889
Loans:
Ending balance individually evaluated for impairment	12		0
Ending balance collectively evaluated for impairment	19,032		17,167
Loans held for investment	19,044		17,167
Unallocated
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Beginning balance	1,111	724
Charge-offs	0	0
Recoveries	0	0
Provision (recapture)	(803)	208
Ending balance	308	$ 932
Loans individually evaluated for impairment	0		0
Loans collectively evaluated for impairment	308		1,111
Ending balance	308		1,111
Loans:
Ending balance individually evaluated for impairment	0		0
Ending balance collectively evaluated for impairment	0		0
Loans held for investment	$ 0		$ 0

Interest Bearing Deposits - Interest-Bearing Deposits (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Interest-bearing Deposits
Savings	$ 92,370	$ 88,536
Money market	919,281	912,558
Interest checking	371,122	278,406
Time, $250 or more	152,877	77,868
Other time	26,157	26,404
Total interest-bearing deposits	$ 1,561,807	$ 1,383,772

Interest Bearing Deposits - Maturities of Time Deposits (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Interest-bearing Deposits
2022	$ 177,996
2023	599
2024	438
2025	0
2026	1
Total time deposits	$ 179,034	$ 104,300

Interest Bearing Deposits - Composition of Network Deposits (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Total network deposits	$ 349,544	$ 330,047
CDARS
Total network deposits	22,160	22,411
ICS
Total network deposits	$ 327,384	$ 307,636

Interest Bearing Deposits - Interest Expense Recognized on Interest-bearing Deposits (Details) - USD ($)	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Interest-bearing Deposits
Savings	$ 25,000	$ 15,000
Money market	367,000	582,000
Interest checking	70,000	38,000
Time deposits minimum	250,000
Time, $250 or more	59,000	7,000
Other time	24,000	57,000
Total interest expense on interest-bearing deposits	$ 545,000	$ 699,000

Interest-Bearing Deposits - Narrative (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Interest-bearing Deposits
Interest-bearing domestic deposit, time deposits	$ 179,034	$ 104,300
Related party deposit liabilities	$ 39,600	$ 32,400

Leases - Narrative (Details) - USD ($)	3 Months Ended
Leases - Narrative (Details) - USD ($)	Mar. 31, 2021	Mar. 31, 2022
Lessee, Lease, Description [Line Items]
Rent expense	$ 100,000
Operating lease, rent income	5,200
Accounting Standards Update 2016-02
Lessee, Lease, Description [Line Items]
Rent expense	$ 300,000
Minimum
Lessee, Lease, Description [Line Items]
Renewal options term		0 years
Maximum
Lessee, Lease, Description [Line Items]
Renewal options term		5 years

Leases - Schedule of Lease Cost (Details) $ in Thousands	3 Months Ended
Leases - Schedule of Lease Cost (Details) $ in Thousands	Mar. 31, 2022 USD ($)
Commitments and Contingencies Disclosure [Abstract]
Operating lease cost	$ 285
Short-term lease cost	0
Variable lease cost	0
Sublease income	(5)
Total lease cost	$ 280

Leases - Schedule of Weighted Average Lease Term and Discount Rate (Details)	Mar. 31, 2022
Commitments and Contingencies Disclosure [Abstract]
Weighted average remaining lease term (in years)	5 years 10 months 13 days
Weighted average discount rate (percent)	2.14%

Leases - Future Operating Lease Payments (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Commitments and Contingencies Disclosure [Abstract]
2022	$ 803
2023	1,009
2024	984
2025	767
2026	665
Thereafter	1,107
Total expected operating lease payments	5,335
Discount for present value of expected cash flows	(348)
Operating lease liability	$ 4,987	$ 0

Long Term Debt and Other Borrowings (Details)			3 Months Ended
Long Term Debt and Other Borrowings (Details)	Nov. 08, 2019 USD ($)	Sep. 28, 2017 USD ($)	Mar. 31, 2022 USD ($) federalFund correspondentBank	Dec. 31, 2021 USD ($) federalFund correspondentBank
Debt Instrument [Line Items]
Subordinated notes, net			$ 28,403,000	$ 28,386,000
Line of credit			$ 0	$ 0
Number of unsecured federal funds \| federalFund			5	5
Number of correspondent banks \| correspondentBank			5	5
Number of unsecured federal funds with an increase in line of credit \| federalFund			1
Subordinated Debt
Debt Instrument [Line Items]
Debt issuance costs			$ 600,000
Amortization, debt issuance costs			$ 300,000
Subordinated Debt \| Fixed-to-floating Rate Subordinated Notes Issued Nov 2019
Debt Instrument [Line Items]
Subordinated notes, net	$ 3,800,000
Interest rate	5.50%
Floating interest rate			4.38%
Subordinated Debt \| Fixed-to-floating Rate Subordinated Notes Issued Nov 2019 \| London Interbank Offered Rate (LIBOR)
Debt Instrument [Line Items]
Basis spread on variable rate			3.544%
Subordinated Debt \| Fixed-to-floating Rate Subordinated Notes Issued Sep 2017
Debt Instrument [Line Items]
Face amount		$ 25,000,000
Floating interest rate			4.88%
Subordinated Debt \| Fixed-to-floating Rate Subordinated Notes Issued Sep 2017 \| London Interbank Offered Rate (LIBOR)
Debt Instrument [Line Items]
Basis spread on variable rate			4.044%
Subordinated Debt \| Entity Controlled by Member of Board of Directors and Three Shareholders
Debt Instrument [Line Items]
Face amount		$ 8,000,000
Subordinated Debt \| Subordinated Notes Maturity Date of September 15, 2027
Debt Instrument [Line Items]
Interest rate		6.00%
Letter of Credit
Debt Instrument [Line Items]
Maximum borrowing capacity			$ 855,900,000	$ 696,300,000
Letters of credit amount			495,500,000	420,500,000
Line of Credit
Debt Instrument [Line Items]
Line of credit			0	0
Remaining borrowing capacity			360,400,000	275,800,000
Line of Credit \| Secure State of California Deposits
Debt Instrument [Line Items]
Letters of credit amount			155,500,000	80,500,000
Line of Credit \| Secure Local Agency Deposit
Debt Instrument [Line Items]
Letters of credit amount			340,000,000	340,000,000
Line of Credit \| Federal Reserve Discount Window
Debt Instrument [Line Items]
Maximum borrowing capacity			18,000,000	17,000,000
Line of credit outstanding			0	0
Line of Credit \| Unsecured Federal Funds Line of Credit
Debt Instrument [Line Items]
Line of credit			160,000,000	$ 150,000,000
Increase to line of credit			$ 10,000,000

Income Taxes - Narrative (Details)		3 Months Ended
Income Taxes - Narrative (Details)	May 05, 2021	Mar. 31, 2022	Mar. 31, 2021
Income Tax Disclosure [Abstract]
Effective/pro forma tax rate	29.56%	27.07%	29.56%

Income Taxes - Pro Forma Provision For Income Taxes (Details) - USD ($) $ in Thousands		3 Months Ended
	May 05, 2021	Mar. 31, 2022	Mar. 31, 2021
Income Tax Disclosure [Abstract]
Net income before provision for income taxes		$ 13,522	$ 10,660
Effective/pro forma tax rate	29.56%	27.07%	29.56%
Actual/pro forma provision for income taxes		$ 3,660	$ 3,151

- Definition

Amount of income (loss) from continuing operations, including income (loss) from equity method investments, before deduction of income tax expense (benefit), and income (loss) attributable to noncontrolling interest.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 32
-Subparagraph (c)
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8933-108599

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 30
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8906-108599

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 32
-Subparagraph (f)
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8933-108599

Reference 4: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 940
-SubTopic 20
-Section 25
-Paragraph 1
-URI http://asc.fasb.org/extlink&oid=123384075&loc=d3e41242-110953

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 22
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8736-108599

Reference 6: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 220
-SubTopic 10
-Section S99
-Paragraph 2
-Subparagraph (SX 210.5-03(10))
-URI http://asc.fasb.org/extlink&oid=123367319&loc=SL114868664-224227

Reference 7: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 944
-SubTopic 220
-Section S99
-Paragraph 1
-Subparagraph (SX 210.7-04(8))
-URI http://asc.fasb.org/extlink&oid=120400993&loc=SL114874131-224263

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 942
-SubTopic 235
-Section S99
-Paragraph 1
-Subparagraph (SX 210.9-05(b)(2))
-URI http://asc.fasb.org/extlink&oid=120399901&loc=d3e537907-122884

Reference 9: http://www.xbrl.org/2003/role/exampleRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 31
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8924-108599

Reference 10: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 942
-SubTopic 220
-Section S99
-Paragraph 1
-Subparagraph (SX 210.9-04(15))
-URI http://asc.fasb.org/extlink&oid=120399700&loc=SL114874048-224260

+ Details

Income Taxes - Provision For Income Tax (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Income Tax Disclosure [Abstract]
Statutory U.S. federal income tax	$ 2,840	$ 2,239
Benefit of S Corporation status	0	(2,239)
State taxes	1,157	382
Other	(337)	0
Provision for income taxes	$ 3,660	$ 382

- Definition

Amount of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations.

+ References + Details

Shareholders’ Equity - Narrative (Details) - USD ($) $ / shares in Units, $ in Thousands			3 Months Ended
	Mar. 17, 2022	Jan. 20, 2022	Mar. 31, 2022	Mar. 31, 2021
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common stock declared (in USD per share)	$ 0.45	$ 0.15
Dividends payable	$ 4,900	$ 2,600
Grants in period (in shares)			22,201	9,454
Stock compensation expense for employee and directors			$ 300	$ 100
Unvested restricted shares (in shares)			138,856	6,296
Unrecognized compensation expense			$ 2,500
Employee
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock compensation expense for employee and directors			$ 169	$ 62
Employee \| Officer
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation, payment award, vesting period (in years)			5 years
Employee \| Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation, payment award, vesting period (in years)			3 years
Employee \| Maximum \| Executive Officer
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation, payment award, vesting period (in years)			7 years
Director
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock compensation expense for employee and directors			$ 108	$ 0
Director \| Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation, payment award, vesting period (in years)			1 year
Director \| Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation, payment award, vesting period (in years)			3 years
Restricted Stock
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grants in period (in shares)			22,201	9,454
Forfeited in period (in shares)			850	2,722

Shareholders' Equity - Summary of Unvested Shares Activity (Details) - $ / shares	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Shares
Grants in period (in shares)	22,201	9,454
Restricted Stock
Shares
Beginning of the period balance (in shares)	127,751	11,568
Grants in period (in shares)	22,201	9,454
Vested in Period (in shares)	(10,246)	(12,004)
Forfeited in period (in shares)	(850)	(2,722)
End of the period balance (in shares)	138,856	6,296
Weighted Average Grant Date Fair Value
Beginning of the period balance (in USD per share)	$ 19.95	$ 21.25
Shares granted (in USD per share)	28.50	18.00
Shares vested (in USD per share)	24.85	20.45
Shares forfeited (in USD per share)	20.00	18.88
End of the period balance (in USD per share)	$ 20.95	$ 18.91

Commitments and Contingencies - Unfunded Loan Commitments and Standby Letters of Credit (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Total commitments and standby letters of credit	$ 249,443	$ 248,877
Commercial lines of credit
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Total commitments and standby letters of credit	116,857	137,354
Undisbursed construction loans
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Total commitments and standby letters of credit	48,918	46,584
Undisbursed commercial real estate loans
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Total commitments and standby letters of credit	65,592	47,793
Agricultural lines of credit
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Total commitments and standby letters of credit	11,608	9,955
Undisbursed agricultural real estate loans
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Total commitments and standby letters of credit	3,428	3,427
Other
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Total commitments and standby letters of credit	$ 3,040	$ 3,764

Commitments and Contingencies - Narrative (Details)	3 Months Ended
Commitments and Contingencies - Narrative (Details)	Mar. 31, 2021 USD ($)	Mar. 31, 2022 USD ($) depositRelationship	Dec. 31, 2021 USD ($)	Dec. 31, 2020 USD ($)
Other Commitments [Line Items]
Allowance for loan losses	$ 22,271,000	$ 23,904,000	$ 23,243,000	$ 22,189,000
Real estate related loans percentage		91.98%	89.87%
Number of deposits \| depositRelationship		66
Deposits over five million, total		$ 5,000,000
Deposits over five million, amount		$ 1,200,000,000
Percentage of deposits over five million deposits		46.75%
Largest single deposit		$ 182,400,000
Percentage of largest single deposit to total deposits		7.29%
Uninsured amount		$ 77,300,000	$ 147,200,000
Rent expense	100,000
Operating lease, rent income	$ 5,200
Unfunded Loan Commitment
Other Commitments [Line Items]
Allowance for loan losses		$ 100,000	$ 100,000

Subsequent Events (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands	Apr. 21, 2022	Mar. 17, 2022	Jan. 20, 2022
Subsequent Event [Line Items]
Common stock declared (in USD per share)		$ 0.45	$ 0.15
Dividends payable		$ 4,900	$ 2,600
Subsequent Event
Subsequent Event [Line Items]
Common stock declared (in USD per share)	$ 0.15
Dividends payable	$ 2,600