0001275168-23-000049 | 10-K | XBRL Viewer

Interest Receivable and Other Assets

12 Months Ended

Dec. 31, 2022

Interest Receivable and Other Assets [Abstract]

Loans and Allowance for Loan Losses

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


(in thousands)	2022		2021
Real estate:
Commercial	$	2,394,674	$	1,586,232
Commercial land and development	7,477		7,376
Commercial construction	88,669		54,214
Residential construction	6,693		7,388
Residential	24,230		28,562
Farmland	52,478		54,805
Commercial:
Secured	165,186		137,062
Unsecured	25,431		21,136
Paycheck Protection Program (“PPP”)	—		22,124
Consumer and other	28,628		17,167
Subtotal	2,793,466		1,936,066
Less: Net deferred loan fees	2,140		1,606
Less: Allowance for loan losses	28,389		23,243
Loans held for investment, net of allowance for loan losses	$	2,762,937	$	1,911,217

Allowance for Loan Losses

Management has an established methodology to determine the adequacy of the allowance for loan losses that assesses the risks and losses inherent in the loan portfolio. For purposes of determining the allowance for loan losses, the Bank has segmented certain loans in the portfolio by product type. Loans are segmented into the following pools: commercial, real

estate, and consumer. The Company further subdivides these segments into classes based on the associated risks within those segments. Commercial loans are divided into the following two classes: secured and unsecured loans. Real estate loans are divided into the following six classes: commercial real estate, commercial land and development, commercial construction, residential construction, residential real estate, and farmland. For each class of loans, management exercises significant judgment to determine the estimation method that fits the credit risk characteristics of its portfolio segment.

The Company uses an internally developed model in this process. Management must use judgment in establishing additional input metrics for the modeling processes. The models and assumptions used to determine the allowance are independently validated and reviewed, at least annually, to ensure that their theoretical foundation, assumptions, data integrity, computational processes, reporting practices, and end-user controls are appropriate and properly documented.

CARES Act and PPP Loans

Pursuant to the CARES Act, which was passed in March 2020, the Company funded over 1,500 loans to eligible small businesses and non-profit organizations who participated in the PPP administered by the SBA. PPP loans have terms of two or five years and earn interest at 1.00%. In addition, the Bank received a fee of 1.00% to 5.00% from the SBA depending on the loan amount, which was netted with loan origination costs and amortized into interest income under the effective yield method over the contractual life of the loan. The recognition of fees and costs is accelerated when the loan is forgiven by the SBA and/or paid off prior to maturity. PPP loans are fully guaranteed by the SBA and are expected to be forgiven by the SBA if they meet the requirements of the program. There were no PPP loans outstanding at December 31, 2022. The balance of PPP loans at December 31, 2021 was $22,124,000.

The CARES Act also required the SBA to make payments on new and existing 7(a) loans for up to six months. These were not deferments but rather full payments of principal and interest that the borrower will not be responsible for in the future. As of December 31, 2022 and 2021, the principal outstanding on loans that received one or more of these payments under the CARES Act was $1,649,000 and $46,601,000, respectively.

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 completed 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 using 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.

Concentrations

The Company’s customers are primarily located in the Greater Sacramento and North Valley regions of California. As of December 31, 2022, approximately 92% of the Company’s loans were real estate related, 7% were commercial, and 1% were consumer.

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 the 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 December 31, 2022:


(in thousands)	Pass		Watch		Substandard		Doubtful		Total
Real estate:
Commercial	$	2,379,766	$	14,802	$	106	$	—	$	2,394,674
Commercial land and development	7,477		—		—		—		7,477
Commercial construction	82,769		5,900		—		—		88,669
Residential construction	6,693		—		—		—		6,693
Residential	24,055		—		175		—		24,230
Farmland	52,478		—		—		—		52,478
Commercial:
Secured	163,879		1,184		123		—		165,186
Unsecured	25,431		—		—		—		25,431
Consumer	28,602		—		26		—		28,628
Total	$	2,771,150	$	21,886	$	430	$	—	$	2,793,466

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 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 December 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	$	—	$	—	$	—	$	2,394,674	$	2,394,674
Commercial land and development	—		—		—		7,477		7,477
Commercial construction	—		—		—		88,669		88,669
Residential construction	—		—		—		6,693		6,693
Residential	—		—		—		24,230		24,230
Farmland	—		—		—		52,478		52,478
Commercial:
Secured	—		—		—		165,186		165,186
Unsecured	—		—		—		25,431		25,431
Consumer and other	194		—		194		28,434		28,628
Total	$	194	$	—	$	194	$	2,793,272	$	2,793,466

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, 2022.

The age analysis of past due loans by class as of December 31, 2021 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	$	—	$	—	$	—	$	1,586,232	$	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 December 31, 2022 and 2021 consisted of the following:


	December 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	$	106	$	106	$	—	$	122	$	122	$	—
Residential	175		175		—		178		178		—
Commercial:
Secured	—		—		—		116		116		—

	281		281		—		416		416		—

With an allowance recorded:
Commercial:
Secured	123		123		123		172		172		172
	123		123		123		172		172		172

Total by category:
Real estate:
Commercial	106		106		—		122		122		—
Residential	175		175		—		178		178		—
Commercial:
Secured	123		123		123		288		288		172

Total impaired loans	$	404	$	404	$	123	$	588	$	588	$	172

At December 31, 2022, one collateral dependent loan was in the process of foreclosure: a commercial term loan secured by a single family residence with an unpaid principal balance of $175,000 and no related allowance. No collateral dependent loans were in process of foreclosure at December 31, 2021. In addition, the weighted average loan-to-value of impaired, collateral dependent loans was approximately 82.42% and 70.67% at December 31, 2022 and 2021, respectively.

Information related to impaired loans for the years ended December 31, 2022 and 2021 consisted of the following:


	Years ended December 31,
	2022				2021
(in thousands)	Average Recorded Investment		Interest Income Recognized			Average Recorded Investment		Interest Income Recognized
With no related allowance recorded:
Real estate:
Commercial	$	113	$	—		$	129	$	—
Residential	176		—			181		—
Commercial:
Secured	28		—			120		—
Consumer and other	8		—			—		—
	325		—			430		—

With an allowance recorded:
Commercial:
Secured	348		—			78		—
Consumer and other	2		—			9		—
	350		—			87		—

Total by category:
Real estate:
Commercial	113		—			129		—
Residential	176		—			181		—
Commercial:
Secured	376		—			198		—
Consumer and other	10		—			9		—
Total impaired loans	$	675	$	—		$	517	$	—

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


(in thousands)	2022		2021
Real estate:
Commercial	$	106	$	122
Residential	175		178
Commercial:
Secured	123		288
Total non-accrual loans	$	404	$	588

The amount of foregone interest income related to non-accrual loans was $39,000 and $33,000 for the years ended December 31, 2022 and 2021, respectively.

Troubled Debt Restructuring

The Company’s loan portfolio may include certain loans that have been modified in a 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.

There was one loan outstanding with a TDR designation at December 31, 2022: a nonaccrual, commercial secured loan which had not defaulted with an outstanding balance of $29,000 and reserves covering the amount of the outstanding balance. There were no loans outstanding with a TDR designation at December 31, 2021.

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, 2019; and (iii) executed between March 1, 2020 and the earlier of: (i) 60 days after the date of termination of the federal national emergency; or (ii) January 1, 2022. 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 December 31, 2022, no borrowing relationships were continuing to benefit from payment relief. The Company accrued and recognized interest income on loans under payment relief based on the original contractual interest rates. When payments resumed at the end of the relief period, the payments were generally applied to accrued interest due until accrued interest was fully paid.

The following table discloses activity in the allowance for loan losses for the year ended December 31, 2022.


(in thousands)	Beginning Balance		Charge-offs		Recoveries		Provision (Benefit)		Ending Balance
Real estate:
Commercial	$	12,869	$	—	$	—	$	6,347	$	19,216
Commercial land and development	50		—		—		4		54
Commercial construction	371		—		—		274		645
Residential construction	50		—		—		(1)		49
Residential	192		—		—		(17)		175
Farmland	645		—		—		(1)		644
Commercial:
Secured	6,859		(1,690)		204		1,725		7,098
Unsecured	207		(2)		—		(89)		116
PPP	—		(21)		21		—		—
Consumer and other	889		(906)		840		(476)		347
Unallocated	1,111		—		—		(1,066)		45
Total	$	23,243	$	(2,619)	$	1,065	$	6,700	$	28,389

The following table discloses activity in the allowance for loan losses for the year ended December 31, 2021.


(in thousands)	Beginning Balance		Charge-offs		Recoveries		Provision (Benefit)		Ending Balance
Real estate:
Commercial	$	9,358	$	—	$	—	$	3,511	$	12,869
Commercial land and development	77		—		—		(27)		50
Commercial construction	821		—		—		(450)		371
Residential construction	87		—		—		(37)		50
Residential	220		—		—		(28)		192
Farmland	615		—		—		30		645
Commercial:
Secured	9,476		(822)		263		(2,058)		6,859
Unsecured	179		—		—		28		207

Consumer and other	632		(321)		234		344		889
Unallocated	724		—		—		387		1,111
Total	$	22,189	$	(1,143)	$	497	$	1,700	$	23,243

The following table summarizes the allocation of the allowance for loan losses by impairment methodology as of December 31, 2022.


	Ending allowance balance allocated to:						Ending balance of:
(in thousands)	Loans individually evaluated for impairment		Loans collectively evaluated for impairment		Total loans		Loans individually evaluated for impairment		Loans collectively evaluated for impairment		Total loans
Real estate:
Commercial	$	—	$	19,216	$	19,216	$	106	$	2,394,568	$	2,394,674
Commercial land and development	—		54		54		—		7,477		7,477
Commercial construction	—		645		645		—		88,669		88,669
Residential construction	—		49		49		—		6,693		6,693
Residential	—		175		175		175		24,055		24,230
Farmland	—		644		644		—		52,478		52,478
Commercial:
Secured	123		6,975		7,098		123		165,063		165,186
Unsecured	—		116		116		—		25,431		25,431

Consumer and other	—		347		347		—		28,628		28,628
Unallocated	—		45		45		—		—		—
Total	$	123	$	28,266	$	28,389	$	404	$	2,793,062	$	2,793,466

The following table summarizes the allocation of the allowance for loan losses by impairment methodology as of December 31, 2021.


	Ending allowance balance allocated to:						Ending balance of:
(in thousands)	Loans individually evaluated for impairment		Loans collectively evaluated for impairment		Total loans		Loans individually evaluated for impairment		Loans collectively evaluated for impairment		Total loans
Real estate:
Commercial	$	—	$	12,869	$	12,869	$	122	$	1,586,110	$	1,586,232
Commercial land and development	—		50		50		—		7,376		7,376
Commercial construction	—		371		371		—		54,214		54,214
Residential construction	—		50		50		—		7,388		7,388
Residential	—		192		192		178		28,384		28,562
Farmland	—		645		645		—		54,805		54,805
Commercial:
Secured	172		6,687		6,859		288		136,774		137,062
Unsecured	—		207		207		—		21,136		21,136
PPP	—		—		—		—		22,124		22,124
Consumer and other	—		889		889		—		17,167		17,167
Unallocated	—		1,111		1,111		—		—		—
Total	$	172	$	23,071	$	23,243	$	588	$	1,935,478	$	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 $1,627,056,000 and $941,160,000 at December 31, 2022 and 2021, respectively. In addition, the Company pledges eligible tenants in common loans, which totaled $41,934,000 and $33,391,000 at December 31, 2022 and 2021, respectively, to secure its borrowing capacity with the Federal Reserve Bank of San Francisco. See Note 9, Long Term Debt and Other Borrowings, for further discussion of these borrowings.

Interest Receivable and Other Assets

Interest receivable and other assets consisted of the following as of December 31, 2022 and 2021:


(in thousands)	2022		2021
Interest receivable	$	7,454	$	5,332
Equity investments	5,680		5,741
Servicing assets	2,286		2,215
Other assets	18,657		8,340
	$	34,077	$	21,628

Servicing assets represent the assets related to servicing loans for others, including collecting payments, maintaining escrow accounts, disbursing payments to investors, and conducting foreclosure proceedings. The Company serviced loans with unpaid principal balances of $192,880,000 and $194,649,000 as of December 31, 2022 and 2021, respectively, on behalf of others.

Capital Requirements and Restrictions on Retained Earnings

12 Months Ended

Dec. 31, 2022

Banking Regulation, Risk-Based Information [Abstract]

Capital Requirements and Restrictions on Retained Earnings

The Company and the Bank are subject to various regulatory capital requirements administered by federal and state banking agencies. Failure to meet minimum capital requirements can initiate certain mandatory and possibly additional discretionary actions by regulators that, if undertaken, could have a direct material effect on the Company’s consolidated financial statements.

Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Company and the Bank must meet specific capital guidelines that involve quantitative measures of their assets, liabilities, and certain off-balance sheet items as calculated under regulatory accounting practices.

The capital amounts and the Bank’s prompt corrective action classifications are also subject to qualitative judgments by the regulators about components, risk weightings, and other factors. Prompt corrective action provisions are generally not applicable to bank holding companies. Quantitative measures established by regulation to ensure capital adequacy require the Company and the Bank to maintain minimum amounts and ratios (set forth in the below table) of total capital, Tier 1 capital, and common equity Tier 1 capital (as defined in the regulations) to risk-weighted assets and of Tier 1 capital to average assets. Historically, as a bank holding company with less than $3.0 billion in total consolidated assets and that met certain other criteria, we had been operating under the Small Bank Holding Company Policy Statement, which provides an exemption from the Board of Governors of the Federal Reserve System’s generally applicable risk-based capital ratio and leverage ratio requirements. Because the Company's total consolidated assets exceeded the $3.0 billion threshold as of

September 30, 2022, the Company is no longer subject to this policy statement and its capital adequacy will be evaluated relative to the Federal Reserve's generally applicable capital requirements. A bank holding company that crosses the $3.0 billion total consolidated assets threshold as of June 30 of a particular year is no longer permitted to file reports as a small holding company beginning the following March. The Company's total consolidated assets were not in excess of $3.0 billion as of June 30, 2022, and so the Company has accordingly prepared and filed financial reports with the Federal Reserve as a small bank holding company. If the Company's total consolidated assets remain in excess of $3.0 billion as of June 30, 2023, starting in March 2024, the Company will cease filing financial reports with the Federal Reserve as though it were a small holding company.

The Company and Bank are required to meet a common equity Tier 1 capital to risk-weighted assets ratio of at least 7.00% (a minimum of 4.50% plus a capital conservation buffer of 2.50%), a Tier 1 capital to risk-weighted assets ratio of at least 8.50% (a minimum of 6.00% plus a capital conservation buffer of 2.50%), a total capital to risk-weighted assets ratio of at least 10.50% (a minimum of 8.00% plus a capital conservation buffer of 2.50%), and a Tier 1 leverage ratio of at least 4.00%. Management believes that, as of December 31, 2022, the Company and the Bank met all capital adequacy requirements to which they are subject.

As of December 31, 2022, the Bank was categorized as “well-capitalized” under the regulatory framework for prompt corrective action. To be categorized as well-capitalized, an institution must maintain minimum total risk-based, Tier 1 risk-based, and Tier 1 leverage ratios as set forth in the below table. There are no conditions or events since that notification that management believes have changed the Bank’s category.

The principal source of cash for the Company is dividends from the Bank. Dividends from the Bank to the Company are restricted under California law to the lesser of: (i) the Bank’s retained earnings; or (ii) the Bank’s net income for the latest three fiscal years, less dividends previously declared during that period. As of December 31, 2022 and 2021, the maximum amount available for dividend distribution under this restriction was approximately $33,867,000 and $15,464,000, respectively. If a proposed dividend exceeds the limit, the Bank may still pay a dividend to the Holding Company if it obtains approval from the California Department of Financial Protection and Innovation and the dividend does not exceed the greater of: (i) the retained earnings of the Bank; (ii) the net income of the Bank for its last fiscal year; or (iii) the net income of the Bank for its current fiscal year.

The Company’s and the Bank’s actual capital amounts and ratios as of December 31, 2022 and 2021 are presented in the following tables. As of December 31, 2022 and 2021, Bancorp's Tier 2 capital included subordinated debt, which was not included at the bank level.


Capital Ratios for Bancorp (dollars in thousands)	Actual Ratio				Required for Capital Adequacy Purposes1				Ratio to be Well- Capitalized under Prompt Corrective Action Provisions
	Amount		Ratio		Amount		Ratio		Amount	Ratio
December 31, 2022
Total capital (to risk-weighted assets)	$	366,113	12.46	%	$	235,065	8.00	%	N/A	N/A
Tier 1 capital (to risk-weighted assets)	$	263,993	8.99	%	$	176,191	6.00	%	N/A	N/A
Common equity tier 1 capital (to risk-weighted assets)	$	263,993	8.99	%	$	132,144	4.50	%	N/A	N/A
Tier 1 leverage	$	263,993	8.60	%	$	122,788	4.00	%	N/A	N/A
December 31, 2021
Total capital (to risk-weighted assets)	$	285,128	13.98	%	$	163,177	8.00	%	N/A	N/A
Tier 1 capital (to risk-weighted assets)	$	233,397	11.44	%	$	122,382	6.00	%	N/A	N/A
Common equity tier 1 capital (to risk-weighted assets)	$	233,397	11.44	%	$	91,787	4.50	%	N/A	N/A
Tier 1 leverage	$	233,397	9.47	%	$	98,600	4.00	%	N/A	N/A


Capital Ratios for the Bank (dollars in thousands)	Actual Ratio				Required for Capital Adequacy Purposes				Ratio to be Well- Capitalized under Prompt Corrective Action Provisions
	Amount		Ratio		Amount		Ratio		Amount		Ratio
December 31, 2022
Total capital (to risk-weighted assets)	$	356,301	12.14	%	$	234,795	8.00	%	$	293,494	10.00	%
Tier 1 capital (to risk-weighted assets)	$	327,788	11.17	%	$	176,072	6.00	%	$	234,763	8.00	%
Common equity tier 1 capital (to risk-weighted assets)	$	327,788	11.17	%	$	132,054	4.50	%	$	190,745	6.50	%
Tier 1 leverage	$	327,788	10.69	%	$	122,652	4.00	%	$	153,315	5.00	%
December 31, 2021
Total capital (to risk-weighted assets)	$	279,152	13.69	%	$	163,078	8.00	%	$	203,848	10.00	%
Tier 1 capital (to risk-weighted assets)	$	255,807	12.55	%	$	122,309	6.00	%	$	163,078	8.00	%
Common equity tier 1 capital (to risk-weighted assets)	$	255,807	12.55	%	$	91,731	4.50	%	$	132,501	6.50	%
Tier 1 leverage	$	255,807	10.38	%	$	98,555	4.00	%	$	123,193	5.00	%


1			Prior to September 30, 2022, Bancorp operated under the Small Bank Holding Company Policy Statement and therefore, was not subject to Basel III capital adequacy requirements. The listed capital adequacy ratios exclude capital conservation buffers.

- Definition

The entire disclosure for regulatory capital requirement for depository and lending institutions. Institutions include, but not are not limited to, finance company, insured depository institution, bank holding company, savings and loan association holding company, bank and savings institution not federally insured, mortgage company, foreign financial institution and credit union.

+ References + Details

Bank-owned Life Insurance	12 Months Ended
Bank-owned Life Insurance	Dec. 31, 2022
Investments, All Other Investments [Abstract]
Bank-owned Life Insurance	Bank-owned Life InsuranceThe Company owns life insurance policies on the lives of certain current and former officers designated by the board of directors to fund our employee benefit programs. Death benefits provided under the specific terms of these insurance policies are estimated to be $32,931,000 at December 31, 2022. The benefits to employees’ beneficiaries are limited to each employee’s active service period. The investment in BOLI policies is reported at their cash surrender value, net of surrender charges, of $14,669,000 and $11,203,000 at December 31, 2022 and 2021, respectively. The cash surrender value includes both the original premiums paid for the life insurance policies and the accumulated accretion of policy income since inception of the policies, net of mortality costs and other fees. Income of $412,000 and $237,000 was recognized on these life insurance policies for the years ended December 31, 2022 and 2021, respectively.

Capital Requirements and Restrictions on Retained Earnings - Schedule of Capital Ratios (Details) $ in Thousands	Dec. 31, 2022 USD ($)	Dec. 31, 2021 USD ($)
Federal Home Loan Bank, Advances, Branch of FHLB Bank [Line Items]
Total capital (to risk-weighted assets), Actual Ratio, Amount	$ 366,113	$ 285,128
Total capital (to risk-weighted assets), Actual Ratio, Ratio (in percent)	0.1246	0.1398
Total capital (to risk-weighted assets), Required for Capital Adequacy Purposes, Amount	$ 235,065	$ 163,177
Total capital (to risk-weighted assets), Required for Capital Adequacy Purposes, Ratio (in percent)	0.0800	0.0800
Tier 1 capital (to risk-weighted assets), Actual Ratio, Amount	$ 263,993	$ 233,397
Tier 1 capital (to risk-weighted assets), Actual Ratio, Ratio (in percent)	0.0899	0.1144
Tier 1 capital (to risk-weighted assets), Required for Capital Adequacy Purposes, Amount	$ 176,191	$ 122,382
Tier 1 capital (to risk-weighted assets), Required for Capital Adequacy Purposes, Ratio (in percent)	0.0600	0.0600
Common equity tier 1 capital (to risk-weighted assets), Actual Ratio, Amount	$ 263,993	$ 233,397
Common equity tier 1 capital (to risk-weighted assets), Actual Ratio, Ratio (in percent)	0.0899	0.1144
Common equity tier 1 capital (to risk-weighted assets), Required for Capital Adequacy Purposes, Amount	$ 132,144	$ 91,787
Common equity tier 1 capital (to risk-weighted assets), Required for Capital Adequacy Purposes, Ratio (in percent)	0.0450	0.0450
Tier 1 leverage, Actual Ratio, Amount	$ 263,993	$ 233,397
Tier 1 leverage, Actual Ratio, Ratio (in percent)	0.0860	0.0947
Tier 1 Leverage, Required for Capital Adequacy Purposes, Amount	$ 122,788	$ 98,600
Tier 1 leverage, Required for Capital Adequacy Purposes, Ratio (in percent)	0.0400	0.0400
Subsidiaries
Federal Home Loan Bank, Advances, Branch of FHLB Bank [Line Items]
Total capital (to risk-weighted assets), Actual Ratio, Amount	$ 356,301	$ 279,152
Total capital (to risk-weighted assets), Actual Ratio, Ratio (in percent)	0.1214	0.1369
Total capital (to risk-weighted assets), Required for Capital Adequacy Purposes, Amount	$ 234,795	$ 163,078
Total capital (to risk-weighted assets), Required for Capital Adequacy Purposes, Ratio (in percent)	0.0800	0.0800
Tier 1 capital (to risk-weighted assets), Actual Ratio, Amount	$ 327,788	$ 255,807
Tier 1 capital (to risk-weighted assets), Actual Ratio, Ratio (in percent)	0.1117	0.1255
Tier 1 capital (to risk-weighted assets), Required for Capital Adequacy Purposes, Amount	$ 176,072	$ 122,309
Tier 1 capital (to risk-weighted assets), Required for Capital Adequacy Purposes, Ratio (in percent)	0.0600	0.0600
Common equity tier 1 capital (to risk-weighted assets), Actual Ratio, Amount	$ 327,788	$ 255,807
Common equity tier 1 capital (to risk-weighted assets), Actual Ratio, Ratio (in percent)	0.1117	0.1255
Common equity tier 1 capital (to risk-weighted assets), Required for Capital Adequacy Purposes, Amount	$ 132,054	$ 91,731
Common equity tier 1 capital (to risk-weighted assets), Required for Capital Adequacy Purposes, Ratio (in percent)	0.0450	0.0450
Tier 1 leverage, Actual Ratio, Amount	$ 327,788	$ 255,807
Tier 1 leverage, Actual Ratio, Ratio (in percent)	0.1069	0.1038
Tier 1 Leverage, Required for Capital Adequacy Purposes, Amount	$ 122,652	$ 98,555
Tier 1 leverage, Required for Capital Adequacy Purposes, Ratio (in percent)	0.0400	0.0400
Total capital (to risk-weighted assets), Ratio to be Well-Capitalized under Prompt Corrective Action Provisions, Amount	$ 293,494	$ 203,848
Total capital (to risk-weighted assets), Ratio to be Well-Capitalized under Prompt Corrective Action Provisions, Ratio (in percent)	0.1000	0.1000
Tier 1 capital (to risk-weighted assets), Ratio to be Well-Capitalized under Prompt Corrective Action Provisions, Amount	$ 234,763	$ 163,078
Tier 1 capital (to risk-weighted assets), Ratio to be Well-Capitalized under Prompt Corrective Action Provisions, Ratio (in percent)	0.0800	0.0800
Common equity tier 1 capital (to risk-weighted assets), Ratio to be Well-Capitalized under Prompt Corrective Action Provisions, Amount	$ 190,745	$ 132,501
Common equity tier 1 capital (to risk-weighted assets), Ratio to be Well-Capitalized under Prompt Corrective Action Provisions, Ratio (in percent)	0.0650	0.0650
Tier 1 leverage, Ratio to be Well-Capitalized under Prompt Corrective Action Provisions, Amount	$ 153,315	$ 123,193
Tier 1 leverage, Ratio to be Well-Capitalized under Prompt Corrective Action Provisions, Ratio (in percent)	0.0500	0.0500

Parent Company Only Condensed Financial Information - Balance Sheet (Details) - USD ($)	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2020
ASSETS
Other assets	$ 18,657,000	$ 8,340,000
TOTAL ASSETS	3,227,159,000	2,556,761,000
LIABILITIES AND SHAREHOLDERS’ EQUITY
Subordinated notes and other liabilities	73,606,000	28,386,000
Shareholders’ equity	252,825,000	235,046,000	$ 133,775,000
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	3,227,159,000	2,556,761,000
Parent Company
ASSETS
Cash and cash equivalents	8,688,000	5,636,000	$ 3,555,000
Investment in banking subsidiary	316,620,000	257,456,000
Other assets	3,090,000	922,000
TOTAL ASSETS	328,398,000	264,014,000
LIABILITIES AND SHAREHOLDERS’ EQUITY
Subordinated notes and other liabilities	75,573,000	28,968,000
Shareholders’ equity	252,825,000	235,046,000
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$ 328,398,000	$ 264,014,000

Recently Issued Accounting Standards	12 Months Ended
Recently Issued Accounting Standards	Dec. 31, 2022
Accounting Changes and Error Corrections [Abstract]
Recently Issued Accounting Standards	Recently Issued Accounting Standards The following reflect recent accounting standards that have been adopted or 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 indicate effective dates for the Company as an emerging growth company with the extended transition period. On January 1, 2023, the Company adopted ASU No. 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, which replaces the current “incurred loss” model for recognizing credit losses with an “expected loss” model referred to as the 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. Under ASU 2016-13, available-for-sale debt securities are evaluated for impairment if fair value is less than amortized cost, with any estimated credit losses 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 Company will adopt this standard using 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. A prospective transition approach is required for debt securities for which an OTTI had been recognized before the effective date. The Company currently intends to phase the impact of Topic 326 into regulatory capital over three years in accordance with a final ruling effective April 2019 adopted by the Federal Reserve and other U.S. banking agencies. Accounting Standards Issued But Not Yet Adopted 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. 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. LIBOR administrators have indicated that certain LIBOR settings will continue to be published through June 30, 2023. 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. In December 2022, the FASB issued ASU No. 2022-06, which defers from December 31, 2022 to December 31, 2024 when an entity can no longer apply relief in Topic 848. This was done as the relief permitted until December 31, 2022 would not cover the period until June 30, 2023 when certain LIBOR settings would continue to be published through. The Company has not elected to apply these amendments; however, the Company is assessing the applicability of these ASUs and continues to monitor guidance for reference rate reform from the 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

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
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Reference 14: http://www.xbrl.org/2003/role/disclosureRef
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+ Details

Interest Receivable and Other Assets - Summary of Interest Receivable and Other Assets (Details) - USD ($) $ in Thousands	Dec. 31, 2022	Dec. 31, 2021
Interest Receivable and Other Assets [Abstract]
Interest receivable	$ 7,454	$ 5,332
Equity investments	5,680	5,741
Servicing assets	2,286	2,215
Other assets	18,657	8,340
Interest receivable and other assets	$ 34,077	$ 21,628

Fair Value of Assets and Liabilities - Narrative (Details)	12 Months Ended
	Dec. 31, 2022
Minimum
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Selling and commission costs (in percent)	0.0500
Maximum
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Selling and commission costs (in percent)	0.0700

Commitments and Contingencies - Schedule of Lease Liability Prior to ASC 842 (Details) $ in Thousands	Dec. 31, 2021 USD ($)
Commitments and Contingencies Disclosure [Abstract]
2022	$ 1,025
2023	978
2024	951
2025	733
2026	604
Thereafter	1,094
Total expected operating lease payments	$ 5,385

Loans and Allowance for Loan Losses

12 Months Ended

Dec. 31, 2022

Receivables [Abstract]

Loans and Allowance for Loan Losses

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


(in thousands)	2022		2021
Real estate:
Commercial	$	2,394,674	$	1,586,232
Commercial land and development	7,477		7,376
Commercial construction	88,669		54,214
Residential construction	6,693		7,388
Residential	24,230		28,562
Farmland	52,478		54,805
Commercial:
Secured	165,186		137,062
Unsecured	25,431		21,136
Paycheck Protection Program (“PPP”)	—		22,124
Consumer and other	28,628		17,167
Subtotal	2,793,466		1,936,066
Less: Net deferred loan fees	2,140		1,606
Less: Allowance for loan losses	28,389		23,243
Loans held for investment, net of allowance for loan losses	$	2,762,937	$	1,911,217

Allowance for Loan Losses

CARES Act and PPP Loans

Underwriting

Concentrations

Credit Quality Indicators

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


(in thousands)	Pass		Watch		Substandard		Doubtful		Total
Real estate:
Commercial	$	2,379,766	$	14,802	$	106	$	—	$	2,394,674
Commercial land and development	7,477		—		—		—		7,477
Commercial construction	82,769		5,900		—		—		88,669
Residential construction	6,693		—		—		—		6,693
Residential	24,055		—		175		—		24,230
Farmland	52,478		—		—		—		52,478
Commercial:
Secured	163,879		1,184		123		—		165,186
Unsecured	25,431		—		—		—		25,431
Consumer	28,602		—		26		—		28,628
Total	$	2,771,150	$	21,886	$	430	$	—	$	2,793,466

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

The age analysis of past due loans by class as of December 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	$	—	$	—	$	—	$	2,394,674	$	2,394,674
Commercial land and development	—		—		—		7,477		7,477
Commercial construction	—		—		—		88,669		88,669
Residential construction	—		—		—		6,693		6,693
Residential	—		—		—		24,230		24,230
Farmland	—		—		—		52,478		52,478
Commercial:
Secured	—		—		—		165,186		165,186
Unsecured	—		—		—		25,431		25,431
Consumer and other	194		—		194		28,434		28,628
Total	$	194	$	—	$	194	$	2,793,272	$	2,793,466

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, 2022.

The age analysis of past due loans by class as of December 31, 2021 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	$	—	$	—	$	—	$	1,586,232	$	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 December 31, 2022 and 2021 consisted of the following:


	December 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	$	106	$	106	$	—	$	122	$	122	$	—
Residential	175		175		—		178		178		—
Commercial:
Secured	—		—		—		116		116		—

	281		281		—		416		416		—

With an allowance recorded:
Commercial:
Secured	123		123		123		172		172		172
	123		123		123		172		172		172

Total by category:
Real estate:
Commercial	106		106		—		122		122		—
Residential	175		175		—		178		178		—
Commercial:
Secured	123		123		123		288		288		172

Total impaired loans	$	404	$	404	$	123	$	588	$	588	$	172

Information related to impaired loans for the years ended December 31, 2022 and 2021 consisted of the following:


	Years ended December 31,
	2022				2021
(in thousands)	Average Recorded Investment		Interest Income Recognized			Average Recorded Investment		Interest Income Recognized
With no related allowance recorded:
Real estate:
Commercial	$	113	$	—		$	129	$	—
Residential	176		—			181		—
Commercial:
Secured	28		—			120		—
Consumer and other	8		—			—		—
	325		—			430		—

With an allowance recorded:
Commercial:
Secured	348		—			78		—
Consumer and other	2		—			9		—
	350		—			87		—

Total by category:
Real estate:
Commercial	113		—			129		—
Residential	176		—			181		—
Commercial:
Secured	376		—			198		—
Consumer and other	10		—			9		—
Total impaired loans	$	675	$	—		$	517	$	—

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


(in thousands)	2022		2021
Real estate:
Commercial	$	106	$	122
Residential	175		178
Commercial:
Secured	123		288
Total non-accrual loans	$	404	$	588

The amount of foregone interest income related to non-accrual loans was $39,000 and $33,000 for the years ended December 31, 2022 and 2021, respectively.

Troubled Debt Restructuring

restructure and may only be returned to accruing status after considering the borrower’s sustained repayment performance for a reasonable period, generally six months.

The following table discloses activity in the allowance for loan losses for the year ended December 31, 2022.


(in thousands)	Beginning Balance		Charge-offs		Recoveries		Provision (Benefit)		Ending Balance
Real estate:
Commercial	$	12,869	$	—	$	—	$	6,347	$	19,216
Commercial land and development	50		—		—		4		54
Commercial construction	371		—		—		274		645
Residential construction	50		—		—		(1)		49
Residential	192		—		—		(17)		175
Farmland	645		—		—		(1)		644
Commercial:
Secured	6,859		(1,690)		204		1,725		7,098
Unsecured	207		(2)		—		(89)		116
PPP	—		(21)		21		—		—
Consumer and other	889		(906)		840		(476)		347
Unallocated	1,111		—		—		(1,066)		45
Total	$	23,243	$	(2,619)	$	1,065	$	6,700	$	28,389

The following table discloses activity in the allowance for loan losses for the year ended December 31, 2021.


(in thousands)	Beginning Balance		Charge-offs		Recoveries		Provision (Benefit)		Ending Balance
Real estate:
Commercial	$	9,358	$	—	$	—	$	3,511	$	12,869
Commercial land and development	77		—		—		(27)		50
Commercial construction	821		—		—		(450)		371
Residential construction	87		—		—		(37)		50
Residential	220		—		—		(28)		192
Farmland	615		—		—		30		645
Commercial:
Secured	9,476		(822)		263		(2,058)		6,859
Unsecured	179		—		—		28		207

Consumer and other	632		(321)		234		344		889
Unallocated	724		—		—		387		1,111
Total	$	22,189	$	(1,143)	$	497	$	1,700	$	23,243

The following table summarizes the allocation of the allowance for loan losses by impairment methodology as of December 31, 2022.


	Ending allowance balance allocated to:						Ending balance of:
(in thousands)	Loans individually evaluated for impairment		Loans collectively evaluated for impairment		Total loans		Loans individually evaluated for impairment		Loans collectively evaluated for impairment		Total loans
Real estate:
Commercial	$	—	$	19,216	$	19,216	$	106	$	2,394,568	$	2,394,674
Commercial land and development	—		54		54		—		7,477		7,477
Commercial construction	—		645		645		—		88,669		88,669
Residential construction	—		49		49		—		6,693		6,693
Residential	—		175		175		175		24,055		24,230
Farmland	—		644		644		—		52,478		52,478
Commercial:
Secured	123		6,975		7,098		123		165,063		165,186
Unsecured	—		116		116		—		25,431		25,431

Consumer and other	—		347		347		—		28,628		28,628
Unallocated	—		45		45		—		—		—
Total	$	123	$	28,266	$	28,389	$	404	$	2,793,062	$	2,793,466

The following table summarizes the allocation of the allowance for loan losses by impairment methodology as of December 31, 2021.


	Ending allowance balance allocated to:						Ending balance of:
(in thousands)	Loans individually evaluated for impairment		Loans collectively evaluated for impairment		Total loans		Loans individually evaluated for impairment		Loans collectively evaluated for impairment		Total loans
Real estate:
Commercial	$	—	$	12,869	$	12,869	$	122	$	1,586,110	$	1,586,232
Commercial land and development	—		50		50		—		7,376		7,376
Commercial construction	—		371		371		—		54,214		54,214
Residential construction	—		50		50		—		7,388		7,388
Residential	—		192		192		178		28,384		28,562
Farmland	—		645		645		—		54,805		54,805
Commercial:
Secured	172		6,687		6,859		288		136,774		137,062
Unsecured	—		207		207		—		21,136		21,136
PPP	—		—		—		—		22,124		22,124
Consumer and other	—		889		889		—		17,167		17,167
Unallocated	—		1,111		1,111		—		—		—
Total	$	172	$	23,071	$	23,243	$	588	$	1,935,478	$	1,936,066

Pledged Loans

Interest Receivable and Other Assets

Interest receivable and other assets consisted of the following as of December 31, 2022 and 2021:


(in thousands)	2022		2021
Interest receivable	$	7,454	$	5,332
Equity investments	5,680		5,741
Servicing assets	2,286		2,215
Other assets	18,657		8,340
	$	34,077	$	21,628

Loans and Allowance for Loan Losses - Impaired Loans (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
Recorded Investment
Recorded Investment, With no related allowance recorded	$ 281	$ 416
Recorded Investment, With an allowance recorded	123	172
Recorded Investment, Total	404	588
Unpaid Principal Balance
Unpaid Principal Balance, With no related allowance recorded	281	416
Unpaid Principal Balance, With an allowance recorded	123	172
Unpaid Principal Balance, Total	404	588
Related Allowance	123	172
Average Recorded Investment
Average Recorded Investment, With no related allowance recorded	325	430
Average Recorded Investment, With an allowance recorded	350	87
Average Recorded Investment, Total	675	517
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	106	122
Recorded Investment, Total	106	122
Unpaid Principal Balance
Unpaid Principal Balance, With no related allowance recorded	106	122
Unpaid Principal Balance, Total	106	122
Related Allowance	0	0
Average Recorded Investment
Average Recorded Investment, With no related allowance recorded	113	129
Average Recorded Investment, Total	113	129
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	175	178
Recorded Investment, Total	175	178
Unpaid Principal Balance
Unpaid Principal Balance, With no related allowance recorded	175	178
Unpaid Principal Balance, Total	175	178
Related Allowance	0	0
Average Recorded Investment
Average Recorded Investment, With no related allowance recorded	176	181
Average Recorded Investment, Total	176	181
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	0	116
Recorded Investment, With an allowance recorded	123	172
Recorded Investment, Total	123	288
Unpaid Principal Balance
Unpaid Principal Balance, With no related allowance recorded	0	116
Unpaid Principal Balance, With an allowance recorded	123	172
Unpaid Principal Balance, Total	123	288
Related Allowance	123	172
Average Recorded Investment
Average Recorded Investment, With no related allowance recorded	28	120
Average Recorded Investment, With an allowance recorded	348	78
Average Recorded Investment, Total	376	198
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
Average Recorded Investment
Average Recorded Investment, With no related allowance recorded	8	0
Average Recorded Investment, With an allowance recorded	2	9
Average Recorded Investment, Total	10	9
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

Fair Value of Assets and Liabilities

12 Months Ended

Dec. 31, 2022

Fair Value Disclosures [Abstract]

Fair Value of Assets and Liabilities

The following table summarizes the Company’s assets and liabilities that were carried 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
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	$	115,988	$	—	$	115,988	$	—	OCI
Derivatives – interest rate swap	16		—		16		—		NI
Liabilities:
Derivatives – interest rate swap	16		—		16		—		NI

2021
Assets:
Securities available-for-sale:
U.S. government agencies, mortgage-backed securities, obligations of states and political subdivisions, and collateralized mortgage obligations	$	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 inputs) 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 inputs). Level 2 securities include U.S. agencies’ or government-sponsored agencies’ debt securities, mortgage-backed securities, government agency issued bonds, privately issued collateralized mortgage obligations, and corporate bonds. Level 3 securities are based on unobservable inputs that are supported by little or no market activity. In addition, values use discounted cash flow models and may include significant management judgment and estimation. As of December 31, 2022 and 2021, there were no Level 1 available-for-sale securities and no transfers between Level 1 and Level 2 classifications for assets or liabilities measured at fair value on a recurring basis.

The Company’s investment portfolio service bureau has developed a model for pricing available-for-sale debt securities. Information such as historical and current performance of the underlying collateral, deferral/default rates, collateral coverage ratios, break-even yield calculations, cash flow projections, liquidity, and credit premiums required by a market participant, as well as financial trend analysis with respect to the individual issuing financial institutions and insurance companies, are utilized in determining individual security valuations. Due to current market conditions, as well as the limited trading activity of the securities, the market value of the securities is highly sensitive to assumption changes and market volatility.

The Company’s derivative is comprised of an interest rate swap for a structured lending arrangement and is reported at fair value utilizing Level 2 inputs. The Company obtains fair values from financial institutions that utilize internal models with observable market data inputs to estimate the values of these instruments (Level 2 inputs).

The fair value of collateral dependent impaired loans and other real estate is generally based on recent real estate appraisals. These appraisals may utilize a single valuation approach or a combination of approaches including comparable sales and the income approach. Adjustments are routinely made in the appraisal process by the appraisers to adjust for differences between the comparable sales and income data available. Management also incorporates assumptions regarding market trends or other relevant factors and selling and commission costs ranging from 5.00% to 7.00%. Such adjustments and assumptions are typically significant and result in a Level 3 classification of the inputs for determining fair value.

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 impaired loans that are collateral dependent and OREO. As of December 31, 2022 and 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 December 31, 2022 and 2021. These estimates are made at a specific point in time based on relevant market data and information about the financial instruments. These estimates do not reflect any premium or discount that could result from offering the Company’s entire holdings of a particular financial instrument for sale at one time, nor do they attempt to estimate the value of anticipated future business related to the instruments. In addition, the tax ramifications related to the realization of unrealized gains and losses can have a significant effect on fair value estimates and have not been considered in any of these estimates.

Because no market exists for a significant portion of the Company’s financial instruments, fair value estimates are based on judgments regarding current economic conditions, risk characteristics of various financial instruments, and other factors. These estimates are subjective in nature and involve uncertainties and matters of significant judgment and therefore cannot be determined with precision. Changes in assumptions could significantly affect the fair values presented. 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.


(in thousands)	December 31, 2022					December 31, 2021
	Carrying Amounts		Fair Value		Fair Value Hierarchy	Carrying Amounts		Fair Value		Fair Value Hierarchy
Financial assets:
Cash and cash equivalents	$	259,991	$	259,991	Level 1	$	425,329	$	425,329	Level 1
Time deposits in banks	9,849		9,849		Level 1	14,464		14,464		Level 1
Securities available-for-sale	115,988		115,988		Level 2	148,807		148,807		Level 2
Securities held-to-maturity	3,756		3,432		Level 3	4,946		5,197		Level 3
Loans held for sale	9,416		9,785		Level 2	10,671		11,217		Level 2
Loans held for investment, net of allowance for loan losses	2,762,937		2,570,176		Level 3	1,911,217		1,893,431		Level 3
FHLB stock and other investments	16,570		N/A		N/A	12,464		N/A		N/A
Interest receivable	7,454		7,454		Level 2	5,332		5,332		Level 2
Interest rate swap	16		16		Level 2	92		92		Level 2
Financial liabilities:
Deposits	2,782,004		2,562,600		Level 2	2,285,890		2,210,555		Level 2
Interest payable	1,568		1,568		Level 2	23		23		Level 2
Interest rate swap	16		16		Level 2	92		92		Level 2
Subordinated notes	73,606		72,273		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 December 31, 2022 and 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, net of allowance for loan losses: 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, as 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.

Commitments to extend credit: Commitments to extend credit are primarily for adjustable rate loans. For these commitments, there are no differences between the committed amounts and their fair values. Commitments to fund fixed rate loans are at rates which approximate fair value at each reporting date.

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 - Amortized Cost and Fair Value of Securities Available-for-sale (Details) - USD ($) $ in Thousands	Dec. 31, 2022	Dec. 31, 2021
Marketable Securities [Line Items]
Amortized Cost	$ 135,087	$ 149,610
Gross unrealized gains	103	682
Gross unrealized losses	(19,202)	(1,485)
Fair Value	115,988	148,807
U.S. government agencies
Marketable Securities [Line Items]
Amortized Cost	14,317	19,824
Gross unrealized gains	81	60
Gross unrealized losses	(225)	(202)
Fair Value	14,173	19,682
Mortgage-backed securities
Marketable Securities [Line Items]
Amortized Cost	73,111	82,517
Gross unrealized gains	1	94
Gross unrealized losses	(11,841)	(1,098)
Fair Value	61,271	81,513
Obligations of states and political subdivisions
Marketable Securities [Line Items]
Amortized Cost	45,223	44,732
Gross unrealized gains	21	525
Gross unrealized losses	(6,818)	(120)
Fair Value	38,426	45,137
Collateralized mortgage obligations
Marketable Securities [Line Items]
Amortized Cost	436	537
Gross unrealized gains	0	3
Gross unrealized losses	(41)	0
Fair Value	395	540
Corporate bonds
Marketable Securities [Line Items]
Amortized Cost	2,000	2,000
Gross unrealized gains	0	0
Gross unrealized losses	(277)	(65)
Fair Value	$ 1,723	$ 1,935

Related Party Transactions

12 Months Ended

Dec. 31, 2022

Related Party Transactions

During the normal course of business, the Company may enter into transactions with related parties, including directors, executive officers, principal shareholders, and their businesses or affiliates. 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. The following is a summary of loans to related parties in 2022 and 2021:


(in thousands)	2022		2021
Beginning balance	$	9,418	$	2,048
New loans or advances	340		7,828

Repayments	(3,146)		(458)
Transfers out1	(362)		—
Ending balance	$	6,250	$	9,418

1As a result of a change in employment with the Company, a loan balance belonging to a previously related party was transferred out of the classification of related party loans. The change was not the result of any disagreement with the Company or due to any matter relating to its operations, policies, or practices.

At December 31, 2022 and 2021, deposits from related parties (directors, executive officers, and principal shareholders) totaled $51,960,000 and $32,410,000, respectively. Property management fees totaling $1,000 and $12,000 in 2022 and 2021, respectively, were paid to an entity owned by certain members of the Company’s board of directors.

The Company leases a loan production office from a partnership comprised of certain shareholders and members of the board of directors, which is further described in Note 15, Commitments and Contingencies.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
Income Statement [Abstract]
Net income	$ 44,801	$ 42,441
Net unrealized holding loss on securities available-for-sale during the period	(18,291)	(1,475)
Reclassification adjustment for net realized gains included in net income	(5)	(724)
Income tax benefit related to net unrealized loss and reclassification adjustment	(5,408)	(288)
Other comprehensive loss	(12,888)	(1,911)
Total comprehensive income	$ 31,913	$ 40,530

- Definition

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

+ References

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+ Details

Income Taxes - Schedule of Deferred Tax Assets (Details) - USD ($) $ in Thousands	Dec. 31, 2022	Dec. 31, 2021
Deferred tax assets:
Allowance for credit losses	$ 9,039	$ 7,398
Supplemental employee retirement plan	507	521
Gain on available-for-sale assets	152	151
Net unrealized loss on securities available-for-sale	5,647	237
State tax	1,044	0
Right of use liability	1,351	0
Other	749	562
Deferred tax assets	18,489	8,869
Deferred tax liabilities:
Deferred loan fees	(4,006)	(2,927)
State tax	0	(379)
Depreciation	(405)	(419)
ROUA	(1,268)	0
Other	(537)	(228)
Deferred tax liabilities	(6,216)	(3,953)
Net deferred tax asset	$ 12,273	$ 4,916

Income Taxes - Provision for Income Taxes (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
Current tax expense
Federal	$ 13,167	$ 6,178
State	6,837	2,530
Current	20,004	8,708
Deferred tax benefit
Federal	(1,762)	(3,561)
State	(185)	(440)
Deferred	(1,947)	(4,001)
Provision for income taxes	$ 18,057	$ 4,707

- Definition

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

+ References + Details

Shareholders’ Equity	12 Months Ended
Shareholders’ Equity	Dec. 31, 2022
Equity [Abstract]
Shareholders' Equity	Shareholders’ Equity Dividends During the year ended December 31, 2022, the Company declared cash dividends on its common shares totaling $15,301,000. Of those total dividends, during 2022, $4,953,000 was paid out for certain shareholders affected by the Company's termination of its S corporation status. This distribution was for the remaining balance on the Company's federal AAA for previously taxed, but undistributed, earnings.

- 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.

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+ Details

Investment Securities - Amortized Cost and Fair Value of Securities Held-to-maturity (Details) - USD ($) $ in Thousands	Dec. 31, 2022	Dec. 31, 2021
Marketable Securities [Line Items]
Amortized Cost	$ 3,756	$ 4,946
Gross unrealized gains	0	251
Gross unrealized losses	(324)	0
Fair Value	3,432	5,197
Obligations of states and political subdivisions
Marketable Securities [Line Items]
Amortized Cost	3,756	4,946
Gross unrealized gains	0	251
Gross unrealized losses	(324)	0
Fair Value	$ 3,432	$ 5,197

Interest Bearing Deposits - Composition of Network Deposits (Details) - USD ($) $ in Thousands	Dec. 31, 2022	Dec. 31, 2021
Interest Bearing Depostis [Line Items]
Total network deposits	$ 285,967	$ 330,047
CDARS
Interest Bearing Depostis [Line Items]
Total network deposits	13,248	22,411
ICS
Interest Bearing Depostis [Line Items]
Total network deposits	$ 272,719	$ 307,636

Premises and Equipment, Net (Tables)

12 Months Ended

Dec. 31, 2022

Property, Plant and Equipment [Abstract]

Schedule of Estimated Lives

The normal estimated lives used in determining depreciation are as follows:


Equipment			3 - 12 years
Furniture and fixtures			5 - 10 years
Leasehold improvements			5 - 15 years
Automobiles			3 - 5 years

Premises and equipment, net, were as follows as of December 31, 2022 and 2021:


(in thousands)	2022		2021
Furniture, fixtures, and equipment	$	3,762	$	3,314
Tenant improvements	1,994		1,973
	5,756		5,287
Less: Accumulated depreciation and amortization	4,151		3,514
Premises and equipment, net	$	1,605	$	1,773

Related Party Transactions (Tables)

12 Months Ended

Dec. 31, 2022

Related Party Transactions

The following is a summary of loans to related parties in 2022 and 2021:


(in thousands)	2022		2021
Beginning balance	$	9,418	$	2,048
New loans or advances	340		7,828

Repayments	(3,146)		(458)
Transfers out1	(362)		—
Ending balance	$	6,250	$	9,418

Commitments and Contingencies - Operating Lease Term and Discount Rate (Details)	Dec. 31, 2022
Commitments and Contingencies Disclosure [Abstract]
Weighted average remaining lease term (in years)	5 years 4 months 17 days
Weighted average discount rate	2.18%

Commitments and Contingencies (Tables)

12 Months Ended

Dec. 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 were as follows:


(in thousands)	2022		2021
Commercial lines of credit	$	147,021	$	137,354
Undisbursed construction loans	80,726		46,584
Undisbursed commercial real estate loans	88,066		47,793
Agricultural lines of credit	10,399		9,955
Undisbursed agricultural real estate loans	1,068		3,427
Other	1,868		3,764
Total commitments and standby letters of credit	$	329,148	$	248,877

Schedule of Least Cost

The following table presents the components of lease expense for the year ended December 31, 2022:


(in thousands)	Twelve months ended December 31, 2022
Operating lease expense	$	1,129


Sublease income	(21)
Total lease expense	$	1,108

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


	December 31, 2022
Weighted average remaining lease term (in years)	5.38 years
Weighted average discount rate	2.18	%

Schedule of Future Minimum Rental Payments for Operating Leases

The following table shows the future minimum lease payments under the Company’s operating lease arrangements as of December 31, 2022.


(in thousands)	December 31, 2022
2023	$	1,009
2024	984
2025	767
2026	665
2027	324
Thereafter	784
Total expected operating lease payments	4,533
Discount for present value of expected cash flows	(290)
Lease liability at December 31, 2022	$	4,243

Schedule of Lease Payments Due Prior to 842 Adoption

For comparability purposes in the year of adoption, undiscounted future minimum lease payments under the predecessor standard of ASC 840 as of December 31, 2021 are provided below.


(in thousands)	December 31, 2021
2022	$	1,025
2023	978
2024	951
2025	733
2026	604
Thereafter	1,094
Total minimum lease payments	$	5,385

Long Term Debt and Other Borrowings	12 Months Ended
Long Term Debt and Other Borrowings	Dec. 31, 2022
Debt Disclosure [Abstract]
Long Term Debt and Other Borrowings	Long Term Debt and Other Borrowings Subordinated notes: On August 17, 2022, the Company completed a private placement of $75,000,000 of fixed-to-floating rate subordinated notes to certain qualified investors, of which $19,250,000 was purchased by existing or former members of the board of directors and their affiliates. The notes will be used for capital management and general corporate purposes, including, without limitation, the redemption of previously existing subordinated notes. The subordinated notes have a maturity date of September 1, 2032 and bear interest, payable semi-annually, at the rate of 6.00% per annum until September 1, 2027. On that date, the interest rate will be adjusted to float at a rate equal to the three-month Secured Overnight Financing Rate plus 329.0 basis points (8.03% as of December 31, 2022) until maturity. The notes include a right of prepayment, on or after August 17, 2027 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 November 5, 2022, the Company exercised its right of redemption on subordinated notes issued in two series: $3,750,000 aggregate principal amount originally issued in 2019, and $25,000,000 aggregate principal amount originally issued in 2017. On December 15, 2022, the subordinated notes were redeemed for cash by the Company at 100% of their principal amount, plus accrued and unpaid interest, in accordance with the subordinated note purchase agreements applicable to each series. Remaining unamortized deferred financing costs associated with such notes were expensed and included in other operating expenses on the consolidated statements of income. The subordinated notes have been structured to qualify as Tier 2 capital for regulatory capital purposes. Debt issuance costs incurred in conjunction with the notes were $1,454,000, of which $61,000 has been amortized through December 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 December 31, 2022 and 2021, the Company’s subordinated debt carrying value was $73,606,000 and $28,386,000, respectively. Other borrowings: The Company has an agreement with the FHLB that 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 $1,002,838,000 at December 31, 2022 and $696,285,000 at December 31, 2021. At December 31, 2022, the Company had outstanding borrowings of $100,000,000 and no borrowings outstanding at December 31, 2021. As of December 31, 2022 and 2021, the Company had letters of credit issued on its behalf totaling $686,500,000 and $420,500,000, respectively, as discussed below. As of December 31, 2022, letters of credit totaling $206,500,000 were pledged to secure State of California deposits and $480,000,000 were pledged to secure local agency deposits. As of December 31, 2021, letters of credit totaling $80,500,000 were pledged to secure State of California deposits and $340,000,000 were pledged to secure local agency deposits. The letters of credit issued and outstanding borrowings reduced the Company’s available borrowing capacity to $216,338,000 and $275,785,000 as of December 31, 2022 and 2021, respectively. At December 31, 2022, the Company had seven unsecured federal funds lines of credit totaling $190,000,000 with seven of its correspondent banks, respectively. At December 31, 2021, the Company had five unsecured federal funds lines of credit totaling $150,000,000 with five of its correspondent banks, respectively. There were no amounts outstanding at December 31, 2022 and 2021. At December 31, 2022 and 2021, the Company had the ability to borrow from the Federal Reserve Discount Window. At December 31, 2022 and 2021, the borrowing capacity under this arrangement was $21,868,000 and $16,999,000, respectively. There were no amounts outstanding at December 31, 2022 and 2021. The borrowing line is secured by liens on the Company’s construction and agricultural loan portfolios.

Basis of Presentation

12 Months Ended

Dec. 31, 2022

Organization, Consolidation and Presentation of Financial Statements [Abstract]

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 Board of Governors of the Federal Reserve System (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 a broad range of banking products and services to customers who are predominantly small and medium-sized businesses, professionals, and individuals primarily 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 one loan production office in 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.

The Company publicly filed a Registration Statement on Form S-1 with the U.S. Securities and Exchange Commission (“SEC”) in connection with its IPO (the “Registration Statement”), which 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 $111,243,000. The net proceeds less other related expenses, including audit fees, legal fees, listing fees, and other expenses, totaled $109,082,000.

Basis of Financial Statement Presentation and Consolidation

The accompanying 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”), including Accounting Standards Updates (“ASU”) and the rules and regulations of the SEC, including the instructions to Regulation S-X.

The 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.

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 a smaller reporting company, and, as such, may take advantage of specified reduced reporting requirements 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

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. Other estimates include fair value measurements, valuation of servicing assets, and deferred tax asset valuation.

Cash and Cash Equivalents

The Company defines cash and cash equivalents as cash, due from financial institutions, interest-bearing deposits in banks with short term original maturities, and federal funds sold. Generally, federal funds are sold for one-day periods, if at all. At times throughout the year, balances can exceed FDIC insurance limits. The Company has not experienced any historical losses associated with balances maintained with financial institutions in excess of FDIC insurance limits, and management continues to monitor the financial condition of the major financial institutions where these funds are held.

Securities Available-for-Sale

Available-for-sale securities consist of bonds, notes, and debentures not classified as trading securities or held-to-maturity securities. Securities are classified as available-for-sale if the Company intends and has the ability to hold those securities for a period of time, but not necessarily to maturity. Any decision to sell a security classified as available-for-sale would be based on various factors, including significant movements in interest rates, changes in the maturity mix of assets and liabilities, liquidity needs, regulatory capital considerations, and other similar factors. Securities available-for-sale are carried at fair value. Unrealized holding gains or losses are included in other comprehensive income as a separate component of shareholders’ equity, net of tax. Realized gains or losses, determined based on the cost of specific securities sold, are included in earnings. Premiums are amortized over the life of the security or, if a callable bond, over the earliest call date, and discounts are accreted over the life of the related investment security as an adjustment to interest income using the effective interest method. Interest income is recognized when earned.

Investments with fair values that are less than amortized cost are considered impaired. Impairment may result from either a decline in the financial condition of the issuing entity or, in the case of fixed interest rate investments, from rising interest rates, or both. At each consolidated financial statement date, management assesses each investment to determine if impaired investments are temporarily impaired or if the impairment is other-than-temporary. Various factors are considered in the assessment, including the nature of the investment, the cause of the impairment, the severity and duration of the impairment, credit ratings, and other credit-related factors such as third-party guarantees and volatility of the security’s fair value. This assessment also includes a determination as to whether the Company intends to sell the security, or if it is more likely than not that the Company will be required to sell the security before recovery of its amortized cost basis less any current-period credit losses. If the Company intends to sell a security or if it is more likely than not that the Company will be required to sell the security before recovery, an other-than-temporary impairment (“OTTI”) write-down is recognized in earnings equal to the entire difference between the security’s amortized cost basis and its fair value. For debt securities that are considered to be OTTI and that the Company does not intend to sell and will not be required to sell prior to recovery of the amortized cost basis, the amount of impairment is separated into the amount that is credit-related (credit loss component) and the amount due to all other factors. The credit loss component is recognized in earnings and is calculated as the difference between the security’s amortized cost basis and the present value of its expected future cash flows. The remaining difference between the security’s fair value and the present value of the future expected cash flows is deemed to be due to factors that are not credit-related and is recognized in other comprehensive income.

Securities Held-to-Maturity

Securities are classified as held-to-maturity if the Company has both the intent and ability to hold those securities to maturity regardless of changes in market conditions, liquidity needs, or changes in general economic conditions. These securities are carried at cost adjusted for amortization of premium to the earliest callable call date and accretion of discount, computed by the effective interest method over the life of the related investment.

Loans and Allowance for Loan Losses

Loans are reported at the principal amount outstanding, net of deferred loan fees and costs and the allowance for loan losses. Interest on loans is accrued daily based on the principal outstanding.

Loan fees, net of certain direct costs of origination, are deferred and recognized in interest income using the level-yield method without anticipating prepayments. During the years ended December 31, 2022 and 2021, salaries and employee benefits totaling $6,155,000 and $5,198,000, respectively, were deferred as loan origination costs.

Loans on which the accrual of interest has been discontinued are designated as non-accrual loans. Accrual of interest on loans is discontinued either when reasonable doubt exists as to the full and timely collection of interest or principal or when a loan becomes contractually past due by 90 days or more with respect to interest or principal. When a loan is placed on non-accrual status, all interest previously accrued, but not collected, is reversed against current period interest income. Income on such loans is then recognized only to the extent that cash is received and where the future collection of principal is probable. Interest accruals are resumed on such loans only when they are brought fully current with respect to interest and principal and when, in the judgment of management, the loans are estimated to be fully collectible as to both principal and interest.

The allowance for loan losses represents the estimated probable incurred loan losses in the Company’s loan portfolio. The allowance for loan losses is established through a provision for loan losses charged to operations. Loans are charged against the allowance for loan losses when management believes that the collectability of the principal is unlikely. Subsequent recoveries of previously charged-off amounts, if any, are credited to the allowance for loan losses.

The allowance for loan losses is evaluated on a regular basis by management and is based on management’s periodic review of the collectability of the loans in light of historical experience, the nature and volume of the loan portfolio, adverse situations that may affect the borrower’s ability to repay, estimated value of any underlying collateral, and prevailing economic conditions. This evaluation is inherently subjective, as it requires estimates that are susceptible to significant revision as more information becomes available. The Audit Committee of the board of directors reviews the adequacy of the allowance at least quarterly.

The allowance consists of: (i) specific allowances for individually identified impaired loans (ASC 310-10, Receivables); (ii) general allowances for pools of loans (ASC 450-20, Contingencies – Loss Contingencies), which incorporate quantitative (e.g., historical loan loss rates) and qualitative risk factors (e.g., portfolio growth and trends, credit concentrations, economic and regulatory factors, etc.); and (iii) unallocated allowances, if any.

The first component, specific allowances, results from the analysis of identified problem credits and the evaluation of sources of repayment, including collateral, as applicable. Through management’s ongoing credit monitoring process, individual loans are identified that have conditions indicating the borrower may be unable to pay all amounts due in accordance with contractual terms. These loans are evaluated for impairment individually by management. Management considers an originated loan to be impaired when it is probable that collection of all amounts due according to the contractual terms of the loan agreement is unlikely. Loans that experience insignificant payment delays and payment shortfalls generally are not classified as impaired. Management determines the significance of payment delays and payment shortfalls on a case-by-case basis, taking into consideration all of the facts and circumstances surrounding the loan and the borrower, including the length of the delay, the reasons for the delay, the borrower’s prior payment record, and the amount of the shortfall in relation to the principal and interest owed. Interest income is recognized on impaired loans in the same manner as non-accrual loans.

When the fair value of the impaired loan is less than the recorded investment in the loan, the difference is recorded as an impairment through the establishment of a specific allowance. For loans determined to be impaired, the extent of the impairment is measured based on the present value of expected future cash flows discounted at the loan’s effective interest rate at origination, based on the loan’s observable market price, or based on the fair value of the collateral if the loan is collateral dependent or if foreclosure is imminent. Generally, with problem credits that are collateral dependent, management obtains appraisals of the collateral at least annually. Appraisals may be obtained more frequently if management believes the collateral value is subject to market volatility, if a specific event has occurred to the collateral, or if the Company believes foreclosure is imminent.

The second component, general allowances, is an estimate of the probable inherent losses in each loan pool with similar risk characteristics. This analysis encompasses the entire loan portfolio, excluding individually identified impaired loans. The model determines general allowances by loan segment based on quantitative (loss history) and qualitative risk factors.

The third component, unallocated allowances, is maintained to cover other uncertainties that could affect management’s estimate of probable losses. The unallocated allowances reflect the margin of imprecision inherent in the underlying assumptions used in the methodologies for estimating specific and general losses in the portfolio. While management believes the best information available is used to determine the allowance for loan losses, the results of operations could be significantly affected if circumstances differ substantially from the assumptions used in determining the allowance. A decline in local and national economic conditions, or significant changes in other assumptions, could result in a material increase in the allowance for loan losses and may adversely affect the Company’s financial condition and results of

operations. While the Company believes the estimates and assumptions used in the determination of the adequacy of the allowance for loan losses are reasonable, there can be no assurance that such estimates and assumptions will not be proved incorrect in the future, that the actual amounts of future provisions will not exceed the amounts of past provisions, or that any increased provisions that may be required will not adversely impact the financial condition and results of operations of the Company.

The Company considers a loan to be a troubled debt restructure (“TDR”) when the Company has granted a concession and the borrower is experiencing financial difficulty. In order to determine whether a borrower is experiencing financial difficulty, an evaluation is performed of the probability that the borrower will be in payment default on any of its debt in the foreseeable future without the modification. This evaluation is performed under the Company’s internal underwriting policy. A TDR loan is generally kept on non-accrual status until, among other criteria, the borrower has paid for six consecutive months with no payment defaults, at which time the TDR may be placed back on accrual status.

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.

In conjunction with the passage of the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”), as well as the revised interagency guidance issued in April 2020, the “Interagency Statement on Loan Modifications and Reporting for Financial Institutions Working With Customers Affected by the Coronavirus (Revised),” banks have been provided the option, for loans meeting specific criteria, to temporarily suspend certain requirements under GAAP related to TDRs for a limited time to account for the effects of COVID-19. As a result, the Company has not recognized eligible COVID-19 loan modifications as TDRs. The CARES Act, as amended by the Consolidated Appropriations Act, specified that COVID-19-related loan modifications executed between March 1, 2020 and the earlier of: (i) 60 days after the date of termination of the national emergency declared by the President; and (ii) January 1, 2022, on loans that were current as of December 31, 2019 are not TDRs. Additionally, loans qualifying for these modifications are not required to be reported as delinquent, non-accrual, impaired, or criticized solely as a result of a COVID-19-related loan modification.

Federal Home Loan Bank Stock

Federal Home Loan Bank stock represents the Company’s investment in the stock of the Federal Home Loan Bank of San Francisco (“FHLB”) and is carried at par value. While technically these are considered equity securities, there is no market for FHLB stock. Therefore, the shares are considered as other investment securities.

Management periodically evaluates FHLB stock for OTTI. Management’s determination of whether these investments are impaired is based on its assessment of the ultimate recoverability of cost rather than by recognizing temporary declines in value. The determination of whether a decline affects the ultimate recoverability of cost is influenced by criteria such as: (i) the significance of any decline in net assets of the FHLB, as compared to the capital stock amount for the FHLB and the length of time this situation has persisted; (ii) commitments by the FHLB to make payments required by law or regulation and the level of such payments in relation to the operating performance of the FHLB; (iii) the impact of legislative and regulatory changes on institutions and, accordingly, the customer base of the FHLB; and (iv) the liquidity position of the FHLB. Both cash and stock dividends are reported as non-interest income.

Premises and Equipment

Premises and equipment are stated at cost less accumulated depreciation and amortization. Depreciation and amortization are provided for in amounts sufficient to relate the cost of depreciable assets to operations over their estimated service lives using a straight-line basis. The normal estimated lives used in determining depreciation are as follows:


Equipment			3 - 12 years
Furniture and fixtures			5 - 10 years
Leasehold improvements			5 - 15 years
Automobiles			3 - 5 years

Leasehold improvements are amortized over the lesser of the useful life of the asset or the remaining term of the lease. The straight-line method of depreciation is followed for all assets for financial reporting purposes, but accelerated methods are used for tax purposes.

When assets are sold or otherwise disposed of, the cost and related accumulated depreciation or amortization are removed from the accounts, and any resulting gain or loss is recognized in income for the period. The cost of maintenance and repairs is charged to expense as incurred.

Other Real Estate

Real estate properties acquired through, or in lieu of, loan foreclosure, are classified as other real estate owned (“OREO”), are to be sold, and are initially recorded at fair value of the property at the date of foreclosure less estimated selling costs. Any write-downs in value are recorded against the allowance for loan losses. Subsequent to foreclosure, valuations are periodically performed, and any revisions in the estimate of fair value are reported as adjustments to the carrying value of the real estate, provided the adjusted carrying amount does not exceed the original amount at foreclosure. Subsequent valuation adjustments are recognized as OREO write-downs. Revenues and expenses incurred from OREO property management are recorded in non-interest income and non-interest expense, respectively. During 2022 and 2021, the Bank did not foreclose on any loans.

BOLI

BOLI is recorded at the amount that can be realized under the insurance contract at the consolidated balance sheet date, which is the cash surrender value adjusted for other charges or other amounts due that are probable at settlement. Increases in contract value are recorded as non-interest income, and insurance proceeds received are recorded as a reduction of the contract value.

Long-Term Assets

Premises, equipment, and other long-term assets are reviewed for impairment when events indicate that their carrying amount may not be recoverable from future undiscounted cash flows. If impaired, the assets are adjusted to reflect their fair value.

Leases

The Company records 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 records 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.

Equity Investments

Equity investments with readily determinable fair values are carried at fair value, with changes in fair value reported in net income. Equity investments without readily determinable fair values are carried at cost, less impairment, if any, and adjusted for changes resulting from observable price changes in orderly transactions for the identical or similar investment.

Loss Contingencies

Loss contingencies, including claims and legal actions arising in the ordinary course of business, are recorded as liabilities when the likelihood of loss is probable and an amount or range of loss can be reasonably estimated.

Transfers of Financial Assets

Transfers of an entire financial asset, a group of financial assets, or a participating interest in an entire financial asset are accounted for as sales when control has been relinquished. Control is deemed to be surrendered when the assets have been isolated from the Company, the transferee obtains the right (free of more than trivial conditions that constrain it from taking advantage of that right) to pledge or exchange the transferred assets, and the Company does not maintain effective control over the transferred assets through an agreement to repurchase them before their maturity.

Included in the loan portfolio are loans guaranteed by the Small Business Administration (the “SBA”), the Farm Service Agency, the Federal Agriculture Mortgage Corporation, and the United States Department of Agriculture, of which the guaranteed portion is expected to be sold in the secondary market in exchange for a one-time premium. At the time the guaranteed portion of the loan is sold, the unguaranteed portion and related right to service the entire loan is retained with the Company, to earn future servicing income. The loans held for sale are accounted for at the lower of cost or fair value, using the aggregate method. Government-guaranteed loans held for sale totaled $9,416,000 and $10,671,000 at December 31, 2022 and 2021, respectively.

Servicing rights acquired through the origination of loans, which are subsequently sold with servicing rights retained, are recognized as separate assets or liabilities. Servicing assets and liabilities are initially recorded at fair value and are subsequently amortized in proportion to, and over the period of, the related net servicing income or expense. The amortized assets are assessed for impairment or increased obligations at the loan level, based on the fair value on a periodic basis.

Loan Commitments and Related Financial Instruments

Financial instruments include off-balance sheet credit instruments, such as commitments to make loans, and financial standby letters of credit issued to meet customer financing needs. The face amount for these items represents the exposure to loss, before considering customer collateral or ability to repay. Such financial instruments are recorded when they are funded.

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. Reserves for unfunded commitments are included as a component of Interest payable and other liabilities on the consolidated balance sheets.

Stock-Based Compensation

Compensation cost is recognized for stock options and restricted stock awards (“RSAs”) issued to executives, directors, and employees, based on the fair value of these awards at the date of grant. A Black-Scholes model is utilized to estimate the grant date fair value of stock options, while the fair value of the Company’s common stock at the date of grant is used for RSAs. Compensation cost is recognized over the required service period, generally defined as the vesting period. For awards with graded vesting, compensation cost is recognized on a straight-line basis over the requisite service period for the entire award.

Supplemental Executive Retirement Plan

The Bank has entered into a non-qualified retirement plan for the Chief Executive Officer based on a continuation of employment. The present value of annual post-retirement payments is allocated to expense over the years of required service.

Income Taxes

The Company has historically elected to be taxed for U. S. federal income tax purposes as an S Corporation. In conjunction with the IPO, the Company filed consents from the requisite amount of shareholders to revoke its S Corporation election with the Internal Revenue Service (the “IRS”), resulting in the commencement of taxation as a C Corporation for U.S. federal and California state income tax purposes in the second quarter of fiscal year 2021. Upon termination of the Company’s S Corporation status, the Company commenced paying U.S. federal income tax and a higher California state income tax on taxable earnings for each year (including the short year beginning on the date the Company’s status as an S Corporation terminated).

As a result of the termination of S Corporation status, deferred tax assets and liabilities were recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of the change in tax rates resulting from becoming a C Corporation was recognized in net income in the year ended December 31, 2022.

The Company files its income taxes on a consolidated basis with its subsidiary. The allocation of income tax expense represents each entity’s proportionate share of the consolidated provision for income taxes.

Income tax expense is the total of the current year income tax due or refundable and the change in deferred tax assets and liabilities. Deferred tax assets and liabilities are the expected future tax amounts for the temporary differences between carrying amounts and tax bases of assets and liabilities computed using enacted tax rates. A valuation allowance, if needed, reduces deferred tax assets to the amount expected to be realized.

The Company accounts for uncertain tax positions in accordance with FASB ASC Topic No. 740, Accounting for Uncertainty in Income Taxes. A tax position is recognized as a benefit only if it is “more likely than not” that the tax position would be sustained in a tax examination, with a tax examination being presumed to occur. The amount recognized is the largest amount of tax benefit that has a likelihood greater than 50% of being realized on examination. For tax positions not meeting the “more likely than not” test, no tax benefit is recorded.

Derivatives

All derivative instruments are recorded at fair value. If derivative instruments are designated as hedges of fair values, both the change in the fair value of the hedge and the hedged item are included in current earnings. Fair value adjustments related to cash flow hedges, if any, are recorded in other comprehensive income or loss and reclassified to earnings when the hedged transaction is reflected in earnings.

Comprehensive Income or Loss

Comprehensive income or loss consists of net income and other comprehensive income or loss. Other comprehensive income or loss includes unrealized gains and losses on securities available-for-sale, net of tax, which are also recognized as separate components of shareholders’ equity.

Earnings Per Common Share (“EPS”)

Basic EPS is net income divided by the weighted average number of common shares outstanding during the period less average unvested RSAs. Diluted EPS includes the dilutive effect of additional potential common shares related to unvested RSAs using the treasury stock method. During the years ended December 31, 2022 and 2021, there were no outstanding stock options. The Company has two forms of outstanding common stock: common stock and unvested RSAs. Following the Company’s IPO, holders of unvested RSAs receive non-forfeitable dividends at the same rate as common shareholders and they both share equally in undistributed earnings; therefore the RSAs are considered participating securities. However, under the two-class method, the difference in EPS is not significant for these participating securities.


(in thousands, except share and per share data)	2022		2021
Net income	$	44,801	$	42,441
Weighted average basic common shares outstanding	17,128,282		14,972,637
Add: Dilutive effects of assumed vesting of restricted stock	37,328		22,576
Weighted average diluted common shares outstanding	17,165,610		14,995,213
Income per common share:
Basic EPS	$	2.61	$	2.83
Diluted EPS	$	2.61	$	2.83

Anti-dilutive shares, which are excluded from the dilutive EPS calculation, were deemed to be immaterial.

For the year ended December 31, 2021, pro forma EPS is calculated by applying an effective tax rate of 19.80%, which is the actual effective tax rate, excluding the effects of the discrete deferred tax adjustment of $4,638,000, as discussed in Note 11, Income Taxes. For the year ended December 31, 2022, pro forma EPS is actual EPS, given that the Company was

a C Corporation for the entirety of the year. The following reconciliation table provides a detailed calculation of pro forma EPS:


(in thousands, except share and per share data)	2022		2021
Net income before provision for income taxes - GAAP	$	62,858	$	47,148
Less: Actual/pro forma provision for income taxes	18,057		9,335
Actual/pro forma net income	44,801		37,813
Weighted average basic common shares outstanding	17,128,282		14,972,637
Add: Dilutive effects of assumed vesting of restricted stock	37,328		22,576
Weighted average diluted common shares outstanding	17,165,610		14,995,213
Income per common share:
Basic EPS	$	2.61	$	2.53
Diluted EPS	$	2.61	$	2.52

Subordinated Notes

The subordinated notes are recorded at par with related debt issuance costs reported as a direct reduction from the carrying amount. Issuance costs are amortized over the remaining maturity of the notes and reflected in interest expense.

Fair Value of Financial Instruments

The consolidated financial statements include various estimated fair value information as of December 31, 2022 and 2021. Such information, which pertains to the Company’s financial instruments, does not purport to represent the aggregate net fair value of the Company. Further, the fair value estimates are based on various assumptions, methodologies, and subjective considerations, which vary widely among different financial institutions, and are subject to change.

Fair Value Measurements

The Company uses fair value measurements to record fair value adjustments to certain assets and liabilities and to determine fair value disclosures. The Company bases the fair values on the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Securities available-for-sale and derivatives, if any, are recorded at fair value on a recurring basis.

Additionally, from time to time, the Company may be required to record certain assets at fair value on a non-recurring basis, such as loans held for sale, certain collateral dependent impaired loans held for investment, and held-to-maturity securities that are other-than-temporarily impaired. These non-recurring fair value adjustments typically involve write-downs of individual assets due to application of lower of cost or fair value accounting.

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).

As a result, if other assumptions had been used, the Company’s recorded earnings or disclosures could have been materially different from those reflected in these consolidated financial statements.

Subsequent Events

The Company has evaluated events and transactions subsequent to December 31, 2022 for recognition or disclosure. Additional detail can be found in Note 19, Subsequent Events.

Reclassifications

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

Interest-Bearing Deposits

12 Months Ended

Dec. 31, 2022

Interest-bearing Deposits

Interest-Bearing Deposits

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


(in thousands)	2022		2021
Interest-bearing transaction accounts	$	240,131	$	278,406
Savings accounts	154,581		88,536
Money market accounts	1,073,532		912,558
Time accounts, $250 or more	198,159		77,868
Other time accounts	144,355		26,404
Total interest-bearing deposits	$	1,810,758	$	1,383,772

Time deposits totaled $342,514,000 and $104,272,000 as of December 31, 2022 and 2021, respectively. There were $124,993,000 of brokered time deposits as of December 31, 2022 and no brokered time deposits as of December 31, 2021. As of December 31, 2022, scheduled maturities of time deposits for the next five years were as follows:


(in thousands)
2023	$	339,306
2024	1,797
2025	100
2026	1,311
2027	—
Total time deposits	$	342,514

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. There were no one-way deposits at December 31, 2022 and 2021. The composition of network deposits as of December 31, 2022 and 2021 was as follows:


(in thousands)	2022		2021
CDARS	$	13,248	$	22,411
ICS	272,719		307,636
Total network deposits	$	285,967	$	330,047

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


(in thousands)	2022		2021
Interest-bearing transaction accounts	$	425	$	155
Savings accounts	376		74
Money market accounts	6,477		1,797
Time accounts, $250 or more	2,804		42
Other time accounts	841		131
Total interest expense on interest-bearing deposits	$	10,923	$	2,199

Fair Value of Assets and Liabilities - Balance Sheet Grouping (Details) - USD ($) $ in Thousands	Dec. 31, 2022	Dec. 31, 2021
Financial assets:
Securities available-for-sale, at fair value	$ 115,988	$ 148,807
Securities held-to-maturity	3,432	5,197
Carrying Amounts
Financial assets:
Cash and cash equivalents	259,991	425,329
Time deposits in banks	9,849	14,464
Securities available-for-sale, at fair value	115,988	148,807
Securities held-to-maturity	3,756	4,946
Loans held for sale	9,416	10,671
Loans held for investment, net of allowance for loan losses	2,762,937	1,911,217
FHLB stock and other investments	16,570	12,464
Interest receivable	7,454	5,332
Interest rate swap	16	92
Financial liabilities:
Deposits	2,782,004	2,285,890
Interest payable	1,568	23
Interest rate swap	16	92
Subordinated notes	73,606	28,386
Fair Value \| Quoted Prices in Active Markets for Identical Assets (Level 1)
Financial assets:
Cash and cash equivalents	259,991	425,329
Time deposits in banks	9,849	14,464
Fair Value \| Significant Other Observable Inputs (Level 2)
Financial assets:
Securities available-for-sale, at fair value	115,988	148,807
Loans held for sale	9,785	11,217
Interest receivable	7,454	5,332
Interest rate swap	16	92
Financial liabilities:
Deposits	2,562,600	2,210,555
Interest payable	1,568	23
Interest rate swap	16	92
Fair Value \| Significant Unobservable Inputs (Level 3)
Financial assets:
Securities held-to-maturity	3,432	5,197
Loans held for investment, net of allowance for loan losses	2,570,176	1,893,431
Financial liabilities:
Subordinated notes	$ 72,273	$ 28,386

Loans and Allowance for Loan Losses - Allocation of Loan Losses (Details) - USD ($)	Dec. 31, 2022	Dec. 31, 2021
Financing Receivable, Past Due [Line Items]
Loans individually evaluated for impairment	$ 123,000	$ 172,000
Loans collectively evaluated for impairment	28,266,000	23,071,000
Total loans	28,389,000	23,243,000
Loans individually evaluated for impairment	404,000	588,000
Loans collectively evaluated for impairment	2,793,062,000	1,935,478,000
Total loans	2,793,466,000	1,936,066,000
Commercial
Financing Receivable, Past Due [Line Items]
Loans individually evaluated for impairment	0	0
Loans collectively evaluated for impairment	19,216,000	12,869,000
Total loans	19,216,000	12,869,000
Loans individually evaluated for impairment	106,000	122,000
Loans collectively evaluated for impairment	2,394,568,000	1,586,110,000
Total loans	2,394,674,000	1,586,232,000
Commercial land and development
Financing Receivable, Past Due [Line Items]
Loans individually evaluated for impairment	0	0
Loans collectively evaluated for impairment	54,000	50,000
Total loans	54,000	50,000
Loans individually evaluated for impairment	0	0
Loans collectively evaluated for impairment	7,477,000	7,376,000
Total loans	7,477,000	7,376,000
Commercial construction
Financing Receivable, Past Due [Line Items]
Loans individually evaluated for impairment	0	0
Loans collectively evaluated for impairment	645,000	371,000
Total loans	645,000	371,000
Loans individually evaluated for impairment	0	0
Loans collectively evaluated for impairment	88,669,000	54,214,000
Total loans	88,669,000	54,214,000
Residential construction
Financing Receivable, Past Due [Line Items]
Loans individually evaluated for impairment	0	0
Loans collectively evaluated for impairment	49,000	50,000
Total loans	49,000	50,000
Loans individually evaluated for impairment	0	0
Loans collectively evaluated for impairment	6,693,000	7,388,000
Total loans	6,693,000	7,388,000
Residential
Financing Receivable, Past Due [Line Items]
Loans individually evaluated for impairment	0	0
Loans collectively evaluated for impairment	175,000	192,000
Total loans	175,000	192,000
Loans individually evaluated for impairment	175,000	178,000
Loans collectively evaluated for impairment	24,055,000	28,384,000
Total loans	24,230,000	28,562,000
Farmland
Financing Receivable, Past Due [Line Items]
Loans individually evaluated for impairment	0	0
Loans collectively evaluated for impairment	644,000	645,000
Total loans	644,000	645,000
Loans individually evaluated for impairment	0	0
Loans collectively evaluated for impairment	52,478,000	54,805,000
Total loans	52,478,000	54,805,000
Secured
Financing Receivable, Past Due [Line Items]
Loans individually evaluated for impairment	123,000	172,000
Loans collectively evaluated for impairment	6,975,000	6,687,000
Total loans	7,098,000	6,859,000
Loans individually evaluated for impairment	123,000	288,000
Loans collectively evaluated for impairment	165,063,000	136,774,000
Total loans	165,186,000	137,062,000
Unsecured
Financing Receivable, Past Due [Line Items]
Loans individually evaluated for impairment	0	0
Loans collectively evaluated for impairment	116,000	207,000
Total loans	116,000	207,000
Loans individually evaluated for impairment	0	0
Loans collectively evaluated for impairment	25,431,000	21,136,000
Total loans	25,431,000	21,136,000
Paycheck Protection Program (“PPP”)
Financing Receivable, Past Due [Line Items]
Loans individually evaluated for impairment		0
Loans collectively evaluated for impairment		0
Total loans		0
Loans individually evaluated for impairment		0
Loans collectively evaluated for impairment		22,124,000
Total loans	0	22,124,000
Consumer and other
Financing Receivable, Past Due [Line Items]
Loans individually evaluated for impairment	0	0
Loans collectively evaluated for impairment	347,000	889,000
Total loans	347,000	889,000
Loans individually evaluated for impairment	0	0
Loans collectively evaluated for impairment	28,628,000	17,167,000
Total loans	28,628,000	17,167,000
Unallocated
Financing Receivable, Past Due [Line Items]
Loans individually evaluated for impairment	0	0
Loans collectively evaluated for impairment	45,000	1,111,000
Total loans	45,000	1,111,000
Loans individually evaluated for impairment	0	0
Loans collectively evaluated for impairment	0	0
Total loans	$ 0	$ 0

Interest Receivable and Other Assets (Tables)

12 Months Ended

Dec. 31, 2022

Interest Receivable and Other Assets [Abstract]

Interest Receivable and Other Assets

Interest receivable and other assets consisted of the following as of December 31, 2022 and 2021:


(in thousands)	2022		2021
Interest receivable	$	7,454	$	5,332
Equity investments	5,680		5,741
Servicing assets	2,286		2,215
Other assets	18,657		8,340
	$	34,077	$	21,628

Shareholders’ Equity -Narrative (Details) - USD ($)			12 Months Ended
Shareholders’ Equity -Narrative (Details) - USD ($)	Mar. 17, 2022	May 03, 2021	Dec. 31, 2022	Dec. 31, 2021
Equity [Abstract]
Dividends declared			$ 15,301,000
Payments to shareholders	$ 4,953,000	$ 26,967,000	$ 15,301,000	$ 51,942,000

Commitments and Contingencies - Schedule of Lease Cost (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2022 USD ($)
Commitments and Contingencies Disclosure [Abstract]
Operating lease expense	$ 1,129
Sublease income	(21)
Total lease expense	$ 1,108

Commitments and Contingencies- Narrative (Details)	12 Months Ended
Commitments and Contingencies- Narrative (Details)	Dec. 31, 2022 USD ($) depositRelationship	Dec. 31, 2021 USD ($)	Dec. 31, 2020 USD ($)
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Allowance for loan losses	$ 28,389,000	$ 23,243,000	$ 22,189,000
Real estate related loans percentage (in percent)	91.84%	89.31%
Number of deposits \| depositRelationship	90
Deposits over five million, total	$ 5,000,000
Deposits over five million, amount	$ 1,804,400,000
Percentage of deposits over five million deposits	64.86%
Largest single deposit	$ 180,000,000
Percentage of largest single deposit to total deposits	6.47%
Uninsured amount	$ 16,163,000	$ 147,219,000
Operating leases, right-of-use asset (“ROUA”)	3,981,000	0
Operating lease liability	4,243,000	0
Lease income		$ 21,000
Operating Lease Income Comprehensive Income Extensible List Not Disclosed Flag		rent income
Unfunded Loan Commitment
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Allowance for loan losses	125,000	$ 100,000
Accounting Standards Update 2016-02
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Rent expense		1,064,000
Affiliated Entity
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Operating lease expense	$ 30,000	$ 140,000
Minimum
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Renewal term (in years)	1 year
Maximum
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Renewal term (in years)	5 years

Income Taxes (Tables)

12 Months Ended

Dec. 31, 2022

Income Tax Disclosure [Abstract]

Schedule of Components of Income Tax Expense (Benefit)

The provision for income tax for the years ended December 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 for the year ended December 31, 2021:


(in thousands)	2022		2021
Statutory U.S. federal income tax	$	13,200	$	9,901
Increase (decrease) resulting from:
Benefit of S Corporation status	—		(4,884)
State taxes	5,381		4,045
Deferred tax asset adjustment	—		(4,638)
Other	(524)		283
Provision for income taxes	$	18,057	$	4,707

The components of the consolidated provision for income taxes are as follows:


(in thousands)	2022		2021
Current tax expense
Federal	$	13,167	$	6,178
State	6,837		2,530
	20,004		8,708
Deferred tax benefit
Federal	(1,762)		(3,561)
State	(185)		(440)
	(1,947)		(4,001)
Provision for income taxes	$	18,057	$	4,707

Schedule of Deferred Tax Assets and Liabilities

Deferred tax assets and liabilities were due to the following as of December 31, 2022 and 2021:


(in thousands)	2022		2021
Deferred tax assets:
Allowance for credit losses	$	9,039	$	7,398
Supplemental employee retirement plan	507		521
Gain on available-for-sale assets	152		151
Net unrealized loss on securities available-for-sale	5,647		237
State tax	1,044		—
Right of use liability	1,351		—
Other	749		562
	18,489		8,869
Deferred tax liabilities:
Deferred loan fees	(4,006)		(2,927)
State tax	—		(379)
Depreciation	(405)		(419)
ROUA	(1,268)		—
Other	(537)		(228)
	(6,216)		(3,953)
Net deferred tax asset	$	12,273	$	4,916

401(k) Benefit Plan -Narrative (Details) - USD ($)	12 Months Ended
401(k) Benefit Plan -Narrative (Details) - USD ($)	Dec. 31, 2022	Dec. 31, 2021
Defined Contribution Plan Disclosure [Line Items]
Expense for matching employees' contributions	$ 634,000	$ 593,000
Matching contribution vesting percentage (in percent)	100.00%
3% Employee Contribution
Defined Contribution Plan Disclosure [Line Items]
Employer matching contribution (in percent)	100.00%
Employer matching contribution, percent of employees' gross pay (in percent)	3.00%
Exceeding 3% Employee Contribution
Defined Contribution Plan Disclosure [Line Items]
Employer matching contribution (in percent)	50.00%
Employer matching contribution, percent of employees' gross pay (in percent)	3.00%
Maximum
Defined Contribution Plan Disclosure [Line Items]
Employer matching contribution, percent of employees' gross pay (in percent)	5.00%

Income Taxes - Narrative (Details) - USD ($)			12 Months Ended
Income Taxes - Narrative (Details) - USD ($)	Mar. 17, 2022	May 03, 2021	Dec. 31, 2022	Dec. 31, 2021
Income Tax Disclosure [Abstract]
Deferred tax adjustment				$ 4,638,000
Deferred tax assets				$ 5,370,000
Effective income tax rate reconciliation, at federal and state statutory income, tax rate (in percent)				29.56%
Payments to shareholders	$ 4,953,000	$ 26,967,000	$ 15,301,000	$ 51,942,000

Basis of Presentation (Tables)

12 Months Ended

Dec. 31, 2022

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Schedule of Estimated Lives

The normal estimated lives used in determining depreciation are as follows:


Equipment			3 - 12 years
Furniture and fixtures			5 - 10 years
Leasehold improvements			5 - 15 years
Automobiles			3 - 5 years

Premises and equipment, net, were as follows as of December 31, 2022 and 2021:


(in thousands)	2022		2021
Furniture, fixtures, and equipment	$	3,762	$	3,314
Tenant improvements	1,994		1,973
	5,756		5,287
Less: Accumulated depreciation and amortization	4,151		3,514
Premises and equipment, net	$	1,605	$	1,773

Schedule of Earnings Per Share


(in thousands, except share and per share data)	2022		2021
Net income	$	44,801	$	42,441
Weighted average basic common shares outstanding	17,128,282		14,972,637
Add: Dilutive effects of assumed vesting of restricted stock	37,328		22,576
Weighted average diluted common shares outstanding	17,165,610		14,995,213
Income per common share:
Basic EPS	$	2.61	$	2.83
Diluted EPS	$	2.61	$	2.83

Schedule of Pro forma Earning Per Share

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


(in thousands, except share and per share data)	2022		2021
Net income before provision for income taxes - GAAP	$	62,858	$	47,148
Less: Actual/pro forma provision for income taxes	18,057		9,335
Actual/pro forma net income	44,801		37,813
Weighted average basic common shares outstanding	17,128,282		14,972,637
Add: Dilutive effects of assumed vesting of restricted stock	37,328		22,576
Weighted average diluted common shares outstanding	17,165,610		14,995,213
Income per common share:
Basic EPS	$	2.61	$	2.53
Diluted EPS	$	2.61	$	2.52

Related Party Transactions - Narrative (Details) - USD ($)	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
Related Party Transactions [Abstract]
Related party deposit liabilities	$ 51,960,000	$ 32,410,000
Property management fees	$ 1,000	$ 12,000

Loans and Allowance for Loan Losses - Narrative (Details)	12 Months Ended
	Dec. 31, 2022 USD ($) loanClass loan	Dec. 31, 2021 USD ($) loan	Mar. 31, 2020 loan
Financing Receivable, Past Due [Line Items]
Number of commercial loan classes \| loanClass	2
Number of real estate loan classes \| loanClass	6
Total loans	$ 2,793,466,000	$ 1,936,066,000
Principal amount outstanding on loans	1,649,000	46,601,000
Loans greater than 90 days past due	$ 0	$ 0
Number of collateral dependent loans \| loan	1	0
Unpaid principal balance of commercial term loan	$ 123,000	$ 172,000
Weighted average loan-to-value of impaired loans (in percent)	0.8242	0.7067
Interest income related to non-accrual loans	$ 39,000	$ 33,000
Number of loans outstanding with a TDR designation \| loan	1	0
Pledged loans	$ 1,627,056,000	$ 941,160,000
Commercial:
Financing Receivable, Past Due [Line Items]
Unpaid principal balance of commercial term loan	175,000
Commercial secured loan with TDR designation
Financing Receivable, Past Due [Line Items]
Outstanding loan balance	$ 29,000
Loan Concentration Risk \| Loans \| Real Estate Portfolio Segment
Financing Receivable, Past Due [Line Items]
Concentration risk (in percent)	92.00%
Loan Concentration Risk \| Loans \| Commercial:
Financing Receivable, Past Due [Line Items]
Concentration risk (in percent)	7.00%
Loan Concentration Risk \| Loans \| Consumer and other
Financing Receivable, Past Due [Line Items]
Concentration risk (in percent)	1.00%
Paycheck Protection Program (“PPP”)
Financing Receivable, Past Due [Line Items]
Number of loans funded \| loan			1,500
Earned interest percentage	1.00%
Total loans	$ 0	22,124,000
Paycheck Protection Program (“PPP”) \| Commercial:
Financing Receivable, Past Due [Line Items]
Total loans		22,124,000
Paycheck Protection Program (“PPP”) \| Minimum
Financing Receivable, Past Due [Line Items]
Loan term (in years)	2 years
Fee percentage received on loans	1.00%
Paycheck Protection Program (“PPP”) \| Maximum
Financing Receivable, Past Due [Line Items]
Loan term (in years)	5 years
Fee percentage received on loans	5.00%
Federal Reserve Bank Of San Francisco
Financing Receivable, Past Due [Line Items]
FRB pledged loans	$ 41,934,000	33,391,000
Financial Asset, 60 to 89 Days Past Due
Financing Receivable, Past Due [Line Items]
Loans between 60-89 days past due	$ 0	$ 0

Investment Securities

12 Months Ended

Dec. 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 Government National Mortgage Association (the “GNMA”) and the SBA, and securities issued by U.S. government-sponsored enterprises (“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 December 31, 2022 and 2021 is presented below.


(in thousands)	Amortized Cost		Gross Unrealized				Fair Value
			Gains		(Losses)
2022
Obligations of states and political subdivisions	3,756		—		(324)		3,432
Total held-to-maturity	$	3,756	$	—	$	(324)	$	3,432
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, for OTTI purposes, 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 December 31, 2022 and 2021 is presented below.


(in thousands)	Amortized Cost		Gross Unrealized				Fair Value
			Gains		(Losses)
2022
U.S. government agencies	$	14,317	$	81	$	(225)	$	14,173
Mortgage-backed securities	73,111		1		(11,841)		61,271
Obligations of states and political subdivisions	45,223		21		(6,818)		38,426
Collateralized mortgage obligations	436		—		(41)		395
Corporate bonds	2,000		—		(277)		1,723
Total available-for-sale	$	135,087	$	103	$	(19,202)	$	115,988
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 December 31, 2022 and 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)	2022								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	$	417	$	381	$	501	$	501	$	491	$	516	$	—	$	—
After one but within five years	1,015		927		—		—		951		999		507		522
After five years through ten years	1,470		1,343		5,320		4,761		3,504		3,682		3,697		3,748
After ten years	854		781		39,402		33,164		—		—		40,528		40,867
Investment securities not due at a single maturity date:
U.S. government agencies	—		—		14,317		14,173		—		—		19,824		19,682
Mortgage-backed securities	—		—		73,111		61,271		—		—		82,517		81,513
Collateralized mortgage obligations	—		—		436		395		—		—		537		540
Corporate bonds	—		—		2,000		1,723		—		—		2,000		1,935
Total	$	3,756	$	3,432	$	135,087	$	115,988	$	4,946	$	5,197	$	149,610	$	148,807

Sales proceeds of investment securities and gross realized gains and/or losses are shown in the following table:


(in thousands)	2022		2021
Available-for-sale:
Sales proceeds	$	1,623	$	47,096
Gross realized gains	5		724

Pledged investment securities are shown in the following table:


(in thousands)	2022		2021
Pledged to the State of California:
Securing deposits of public funds and borrowings	$	40,465	$	63,363
Total pledged investment securities	$	40,465	$	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 December 31, 2022 and 2021:


(in thousands)	< 12 continuous months				12 continuous months or more				Total securities in a loss position
	Fair Value		Unrealized Loss		Fair Value		Unrealized Loss		Fair Value		Unrealized Loss
2022
U.S. government agencies	$	3,090	$	(125)	$	8,392	$	(100)	$	11,482	$	(225)
Mortgage-backed securities	4,360		(470)		56,908		(11,371)		61,268		(11,841)
Obligations of states and political subdivisions	24,707		(4,097)		11,670		(2,721)		36,377		(6,818)
Collateralized mortgage obligations	395		(41)		—		—		395		(41)
Corporate bonds	—		—		1,723		(277)		1,723		(277)
Total temporarily impaired securities	$	32,552	$	(4,733)	$	78,693	$	(14,469)	$	111,245	$	(19,202)
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 152 and 91 available-for-sale securities in unrealized loss positions at December 31, 2022 and 2021, respectively. As of December 31, 2022, the investment portfolio included 62 investment securities that had been in a continuous loss position for twelve months or more and 90 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 OTTI. 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 December 31, 2022. This security was in an unrealized loss position for less than twelve months. There were no held-to-maturity securities in a continuous loss position for more than twelve months.

Obligations issued or guaranteed by government agencies such as the GNMA and the SBA or GSEs under conservatorship such as the FNMA and the 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 $10,890,000 and $6,723,000 of FHLB stock at December 31, 2022 and 2021, respectively. 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 December 31, 2022 and 2021. For the years ended December 31, 2022 and 2021, cash dividends received on FHLB capital stock in the amount of $546,000 and $372,000, respectively, were recorded as non-interest income on the consolidated statements of income.

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY - USD ($) $ in Thousands	Total	Cumulative Effect, Period of Adoption, Adjustment	Employee	Director	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 (in shares) at Dec. 31, 2020					11,000,273
Beginning balance at Dec. 31, 2020	$ 133,775				$ 110,082			$ 22,348		$ 1,345
Net income	42,441							42,441
Other comprehensive loss	(1,911)									(1,911)
Stock offering (in shares)					6,054,750
Stock offering	111,243				$ 111,243
Stock issued under stock award plans (in shares)					132,707
Stock issued under stock award plans	0
Stock compensation expense (non-director and director) (in shares)							41,640
Stock compensation expense (non-director and director)			$ 594	$ 846		$ 594	$ 846
Stock forfeitures (in shares)					(4,522)
Stock forfeitures	0
Reclassification of retained deficit	$ 0				$ (4,321)			4,321
Accounting Standards Update [Extensible Enumeration]	Accounting Standards Update 2016-02
Cash dividends paid	$ (51,942)							(51,942)
Ending balance (in shares) at Dec. 31, 2021					17,224,848
Ending balance at Dec. 31, 2021	235,046	$ 68			$ 218,444			17,168	$ 68	(566)
Net income	44,801							44,801
Other comprehensive loss	(12,888)									(12,888)
Stock issued under stock award plans (in shares)					23,639
Stock issued under stock award plans	0
Stock compensation expense (non-director and director)			$ 652	$ 447		$ 652	$ 447
Stock forfeitures (in shares)					(6,561)
Stock forfeitures	0
Cash dividends paid	(15,301)							(15,301)
Ending balance (in shares) at Dec. 31, 2022					17,241,926
Ending balance at Dec. 31, 2022	$ 252,825				$ 219,543			$ 46,736		$ (13,454)

Equity Incentive Plan (Tables)

12 Months Ended

Dec. 31, 2022

Retirement Benefits [Abstract]

Schedule of Unvested Restricted Shares

The following table summarizes information about unvested restricted shares:


	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	23,639	28.29		174,347	19.97
Shares vested	(48,003)	23.07		(53,642)	20.35
Shares forfeited	(6,561)	21.29		(4,522)	19.33
End of the period balance	96,826	$	20.34	127,751	$	19.95

CONSOLIDATED BALANCE SHEETS - USD ($)	Dec. 31, 2022	Dec. 31, 2021
Assets, Current [Abstract]
Cash and due from financial institutions	$ 32,561,000	$ 136,074,000
Interest-bearing deposits in banks	227,430,000	289,255,000
Cash and cash equivalents	259,991,000	425,329,000
Time deposits in banks	9,849,000	14,464,000
Securities available-for-sale, at fair value	115,988,000	148,807,000
Securities held-to-maturity, at amortized cost (fair value of $3,432 and $5,197 at December 31, 2022 and 2021, respectively)	3,756,000	4,946,000
Loans held for sale	9,416,000	10,671,000
Loans held for investment	2,791,326,000	1,934,460,000
Allowance for loan losses	(28,389,000)	(23,243,000)
Loans held for investment, net of allowance for loan losses	2,762,937,000	1,911,217,000
Federal Home Loan Bank of San Francisco (“FHLB”) stock	10,890,000	6,723,000
Operating leases, right-of-use asset (“ROUA”)	3,981,000	0
Premises and equipment, net	1,605,000	1,773,000
Bank-owned life insurance (“BOLI”)	14,669,000	11,203,000
Interest receivable and other assets	34,077,000	21,628,000
TOTAL ASSETS	3,227,159,000	2,556,761,000
Deposits
Non-interest-bearing	971,246,000	902,118,000
Interest-bearing	1,810,758,000	1,383,772,000
Total deposits	2,782,004,000	2,285,890,000
Subordinated notes, net	73,606,000	28,386,000
FHLB advances	100,000,000	0
Operating lease liability	4,243,000	0
Interest payable and other liabilities	14,481,000	7,439,000
Total liabilities	2,974,334,000	2,321,715,000
Commitments and contingencies (Note 15)
Shareholders’ equity
Preferred stock, no par value; 10,000,000 shares authorized; zero issued and outstanding at December 31, 2022 and 2021, respectively	0	0
Common stock, no par value; 100,000,000 shares authorized; 17,241,926 shares issued and outstanding at December 31, 2022; 17,224,848 shares issued and outstanding at December 31, 2021	219,543,000	218,444,000
Retained earnings	46,736,000	17,168,000
Accumulated other comprehensive loss, net	(13,454,000)	(566,000)
Total shareholders’ equity	252,825,000	235,046,000
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$ 3,227,159,000	$ 2,556,761,000

Equity Incentive Plan

12 Months Ended

Dec. 31, 2022

Retirement Benefits [Abstract]

Equity Incentive Plan

In April 2021, the Company’s board of directors and shareholders approved the Five Star Bancorp 2021 Equity Incentive Plan (the “Equity Incentive Plan”). The Equity Incentive Plan provides for the grant of stock options, stock appreciation rights, performance awards, restricted stock, restricted stock units, and other stock-based awards that the Compensation Committee determines are consistent with the purpose of the Equity Incentive Plan and the interests of the Company. Awards may be granted to the Company’s executives and other key employees, directors, and other service providers, and are designed to align the interests of the Equity Incentive Plan’s participants with the interests of our shareholders. The stock options granted under the Equity Incentive Plan may be either non-statutory stock options or incentive stock options. There were no stock options outstanding at December 31, 2022 or 2021, respectively.

The total number of shares of our common stock reserved and available for grant and issuance pursuant to the Equity Incentive Plan will not exceed 1,700,000 shares, less RSAs granted, plus any RSAs that become available upon forfeiture. Each of these shares may be issued as an incentive stock option. At December 31, 2022, 1,519,826 shares remained available for issuance pursuant to grant awards under the Plan. The Equity Incentive Plan does not contain an “evergreen” provision pursuant to which shares authorized for issuance may be automatically replenished.

Stock-Based Compensation

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 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.

Non-cash stock compensation expense recognized for the years ended December 31, 2022 and 2021 was $1,099,000 and $1,440,000, respectively.

In 2022, the Company granted as compensation to members of the board of directors a total of 15,156 shares scheduled to vest monthly in equal installments over one year contingent on continued service. In 2021, the Company granted a total of 41,640 fully vested shares to members of the board of directors as compensation for their service.

As of December 31, 2022, there was approximately $1,642,000 of unrecognized compensation expense related to the 96,826 unvested restricted shares. Additionally, as of December 31, 2022, the weighed-average term remaining on the unvested restricted shares was 3.53 years. 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 years ended December 31, 2022 and 2021 was immaterial.

The following table summarizes information about unvested restricted shares:


	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	23,639	28.29		174,347	19.97
Shares vested	(48,003)	23.07		(53,642)	20.35
Shares forfeited	(6,561)	21.29		(4,522)	19.33
End of the period balance	96,826	$	20.34	127,751	$	19.95

Basis of Presentation - Narrative (Details)			12 Months Ended
Basis of Presentation - Narrative (Details)	May 07, 2021 USD ($) $ / shares shares	May 05, 2021 shares	Dec. 31, 2022 USD ($) office segment	Dec. 31, 2021 USD ($)	Jun. 02, 2003 shares
Subsidiary, Sale of Stock [Line Items]
Bank common stock exchanged for company common stock (in shares) \| shares					1
Number of branch offices \| office			7
Number of loan production offices \| office			1
Sale of stock, price per share (in USD per share) \| $ / shares	$ 20.00
Proceeds from issuance initial public offering	$ 111,243,000
Sale of stock, consideration received on transaction	$ 109,082,000
Number of reportable segments \| segment			1
Salaries and employee benefits deferred as loan origination costs			$ 6,155,000	$ 5,198,000
Government guaranteed loans			$ 9,416,000	$ 10,671,000
Effective/pro forma tax rate				19.80%
Deferred tax adjustment				$ 4,638,000
Government Assistance, Statement of Income or Comprehensive Income [Extensible Enumeration]			Loan-related fees	Loan-related fees
IPO
Subsidiary, Sale of Stock [Line Items]
Number of shares sold (in shares) \| shares		6,054,750
Over-Allotment Option
Subsidiary, Sale of Stock [Line Items]
Number of shares sold (in shares) \| shares	789,750

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)	12 Months Ended
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)	Dec. 31, 2022	Dec. 31, 2021
Cash flows from operating activities:
Net income	$ 44,801,000	$ 42,441,000
Adjustments to reconcile net income to net cash provided by operating activities:
Provision for loan losses	6,700,000	1,700,000
Loans originated for sale	(60,173,000)	(48,169,000)
Gain on sale of loans	(2,934,000)	(4,082,000)
Proceeds from sale of loans	53,691,000	43,024,000
Net gain on sale of securities available-for-sale	(5,000)	(724,000)
Earnings on BOLI	(412,000)	(237,000)
Stock compensation expense for employee and directors	1,099,000	1,440,000
Change in deferred loan fees	534,000	(1,689,000)
Amortization and accretion of security premiums and discounts	1,267,000	1,561,000
Amortization of subordinated notes issuance costs	122,000	66,000
Depreciation and amortization	649,000	607,000
Decrease in operating lease liability	(978,000)	0
Amortization of operating lease ROUA	987,000	0
Deferred tax provision	(1,942,000)	(4,001,000)
Extinguishment of redeemed subordinated note issuance costs	302,000	0
Net changes in:
Interest receivable and other assets	(5,096,000)	(3,050,000)
Interest payable and other liabilities	7,363,000	(230,000)
Net cash provided by operating activities	45,975,000	28,657,000
Cash flows from investing activities:
Proceeds from sale of securities available-for-sale	1,623,000	47,096,000
Maturities, prepayments, and calls of securities available-for-sale	15,523,000	18,732,000
Purchases of securities available-for-sale	(2,642,000)	(99,686,000)
Net change in time deposits in banks	4,615,000	9,241,000
Loan originations, net of repayments	(848,283,000)	(426,882,000)
Purchase of premises and equipment	(481,000)	(717,000)
Purchase of FHLB stock	(4,223,000)	(491,000)
Purchase of BOLI	(3,054,000)	(2,304,000)
Net cash used in investing activities	(836,922,000)	(455,011,000)
Cash flows from financing activities:
Net change in deposits	496,114,000	501,889,000
Proceeds from issuance of stock	0	111,243,000
FHLB advances	100,000,000	0
Cash dividends paid	(15,301,000)	(51,942,000)
Proceeds from subordinated note issuance	75,000,000	0
Subordinated note issuance costs	(1,454,000)	0
Subordinated note redemption	(28,750,000)	0
Net cash provided by financing activities	625,609,000	561,190,000
Net change in cash and cash equivalents	(165,338,000)	134,836,000
Cash and cash equivalents at beginning of period	425,329,000	290,493,000
Cash and cash equivalents at end of period	259,991,000	425,329,000
Supplemental disclosure of cash flow information:
Interest paid	1,345,000	4,505,000
Income taxes paid	5,200,000	10,450,000
Supplemental disclosure of noncash investing and financing activities:
Transfer from loans held for investment to loans held for sale	10,671,000	4,820,000
Unrealized loss on securities	(18,291,000)	(2,199,000)
Operating lease liabilities recorded in conjunction with adoption of ASC 842	5,221,000	0
ROUA recorded in conjunction with adoption of ASC 842	4,974,000	0
Cumulative effect of adoption of ASC 842 on retained earnings	252,825,000	235,046,000
Disposal of premises and equipment	0	515,000
Reclassification of retained deficit	0	4,321,000
Cumulative Effect, Period of Adoption, Adjustment
Supplemental disclosure of noncash investing and financing activities:
Cumulative effect of adoption of ASC 842 on retained earnings		68,000
Employee
Adjustments to reconcile net income to net cash provided by operating activities:
Stock compensation expense for employee and directors	652,000	594,000
Director
Adjustments to reconcile net income to net cash provided by operating activities:
Stock compensation expense for employee and directors	$ 447,000	$ 846,000

Investment Securities - Available-for-sale Securities in a Continuous Unrealized Loss Position (Details) - USD ($) $ in Thousands	Dec. 31, 2022	Dec. 31, 2021
Marketable Securities [Line Items]
Less than twelve continuous months, fair value	$ 32,552	$ 89,921
Less than twelve continuous months, unrealized loss	(4,733)	(1,223)
Twelve continuous months or longer, fair value	78,693	15,206
Twelve continuous months or longer, unrealized loss	(14,469)	(262)
Total securities in a loss position, fair value	111,245	105,127
Total securities in a loss position, unrealized loss	(19,202)	(1,485)
U.S. government agencies
Marketable Securities [Line Items]
Less than twelve continuous months, fair value	3,090	0
Less than twelve continuous months, unrealized loss	(125)	0
Twelve continuous months or longer, fair value	8,392	13,399
Twelve continuous months or longer, unrealized loss	(100)	(202)
Total securities in a loss position, fair value	11,482	13,399
Total securities in a loss position, unrealized loss	(225)	(202)
Mortgage-backed securities
Marketable Securities [Line Items]
Less than twelve continuous months, fair value	4,360	73,972
Less than twelve continuous months, unrealized loss	(470)	(1,046)
Twelve continuous months or longer, fair value	56,908	1,400
Twelve continuous months or longer, unrealized loss	(11,371)	(52)
Total securities in a loss position, fair value	61,268	75,372
Total securities in a loss position, unrealized loss	(11,841)	(1,098)
Obligations of states and political subdivisions
Marketable Securities [Line Items]
Less than twelve continuous months, fair value	24,707	14,014
Less than twelve continuous months, unrealized loss	(4,097)	(112)
Twelve continuous months or longer, fair value	11,670	407
Twelve continuous months or longer, unrealized loss	(2,721)	(8)
Total securities in a loss position, fair value	36,377	14,421
Total securities in a loss position, unrealized loss	(6,818)	(120)
Collateralized mortgage obligations
Marketable Securities [Line Items]
Less than twelve continuous months, fair value	395
Less than twelve continuous months, unrealized loss	(41)
Twelve continuous months or longer, fair value	0
Twelve continuous months or longer, unrealized loss	0
Total securities in a loss position, fair value	395
Total securities in a loss position, unrealized loss	(41)
Corporate bonds
Marketable Securities [Line Items]
Less than twelve continuous months, fair value	0	1,935
Less than twelve continuous months, unrealized loss	0	(65)
Twelve continuous months or longer, fair value	1,723	0
Twelve continuous months or longer, unrealized loss	(277)	0
Total securities in a loss position, fair value	1,723	1,935
Total securities in a loss position, unrealized loss	$ (277)	$ (65)

Cover - USD ($) $ in Millions	12 Months Ended
Cover - USD ($) $ in Millions	Dec. 31, 2022	Feb. 21, 2023	Jun. 30, 2022
Cover [Abstract]
Document Type	10-K
Document Annual Report	true
Document Period End Date	Dec. 31, 2022
Current Fiscal Year End Date	--12-31
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 Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
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 Public Float			$ 334.4
Entity Common Stock, Shares Outstanding		17,258,904
Documents Incorporated by Reference	Portions of the Registrant’s Definitive Proxy Statement to be filed with the Securities and Exchange Commission pursuant to Regulation 14A for its 2023 Annual Meeting of Shareholders are incorporated by reference into Part III of this Form 10-K.
Entity Central Index Key	0001275168
Document Fiscal Year Focus	2022
Document Fiscal Period Focus	FY
Amendment Flag	false

CONSOLIDATED STATEMENTS OF INCOME - USD ($)	12 Months Ended
CONSOLIDATED STATEMENTS OF INCOME - USD ($)	Dec. 31, 2022	Dec. 31, 2021
Interest and dividend income
Loans, including fees	$ 111,795,000	$ 78,894,000
Taxable securities	1,714,000	1,321,000
Nontaxable securities	713,000	821,000
Interest-bearing deposits in other banks	3,696,000	547,000
Interest and dividend income	117,918,000	81,583,000
Interest expense
Deposits	10,923,000	2,199,000
FHLB advances	185,000	0
Subordinated notes	3,740,000	1,773,000
Interest expense	14,848,000	3,972,000
Net interest income	103,070,000	77,611,000
Provision for loan losses	6,700,000	1,700,000
Net interest income after provision for loan losses	96,370,000	75,911,000
Non-interest income
Service charges on deposit accounts	467,000	424,000
Net gain on sale of securities	5,000	724,000
Gain on sale of loans	2,934,000	4,082,000
Loan-related fees	2,207,000	1,306,000
FHLB stock dividends	546,000	372,000
Earnings on BOLI	412,000	237,000
Other	586,000	135,000
Non-interest income, total	7,157,000	7,280,000
Non-interest expense
Salaries and employee benefits	22,571,000	19,825,000
Occupancy and equipment	2,059,000	1,938,000
Data processing and software	3,091,000	2,494,000
Federal Deposit Insurance Corporation (“FDIC”) insurance	850,000	700,000
Professional services	2,467,000	3,792,000
Advertising and promotional	1,908,000	1,300,000
Loan-related expenses	1,287,000	1,045,000
Other operating expenses	6,436,000	4,949,000
Non-interest expense, total	40,669,000	36,043,000
Income before provision for income taxes	62,858,000	47,148,000
Provision for income taxes	18,057,000	4,707,000
Net income	$ 44,801,000	$ 42,441,000
Basic earnings per common share (in USD per share)	$ 2.61	$ 2.83
Diluted earnings per common share (in USD per share)	$ 2.61	$ 2.83

Basis of Presentation - Pro Forma EPS (Details) - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Net income before provision for income taxes - GAAP	$ 62,858	$ 47,148
Less: Actual/pro forma provision for income taxes	18,057	9,335
Actual/pro forma net income	$ 44,801	$ 37,813
Weighted average basic common shares outstanding (in shares)	17,128,282	14,972,637
Add: Dilutive effects of assumed vesting of restricted stock (in shares)	37,328	22,576
Weighted average diluted common shares outstanding (in shares)	17,165,610	14,995,213
Income per common share:
Basic EPS (in USD per share)	$ 2.61	$ 2.53
Diluted EPS (in USD per share)	$ 2.61	$ 2.52

Commitments and Contingencies

12 Months Ended

Dec. 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 were as follows:


(in thousands)	2022		2021
Commercial lines of credit	$	147,021	$	137,354
Undisbursed construction loans	80,726		46,584
Undisbursed commercial real estate loans	88,066		47,793
Agricultural lines of credit	10,399		9,955
Undisbursed agricultural real estate loans	1,068		3,427
Other	1,868		3,764
Total commitments and standby letters of credit	$	329,148	$	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 $125,000 and $100,000 as of December 31, 2022 and 2021, respectively, 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 91.84% of the Company’s loan portfolio at December 31, 2022 and 89.31% of the Company’s loan portfolio 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 December 31, 2022, the Company had 90 deposit relationships that exceeded $5,000,000 each, totaling $1,804,400,000, or approximately 64.86% of total deposits. The Company’s largest single deposit relationship at December 31, 2022 totaled $180,000,000, or approximately 6.47% 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 the Company’s large depositors.

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 $16,163,000 and $147,219,000 at December 31, 2022 and 2021, respectively.

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 less than one 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 predefined 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, 2023.

The Company leases its Sacramento loan production office from a partnership comprised of certain shareholders and members of the Company's 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 was $30,000 and $140,000 for the years ended December 31, 2022 and 2021, respectively, under these leases.

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 twelve 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 and 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.

As of December 31, 2022, the Company's ROUA and lease liability were $3,981,000 and $4,243,000, respectively.

The following table presents the components of lease expense for the year ended December 31, 2022:


(in thousands)	Twelve months ended December 31, 2022
Operating lease expense	$	1,129


Sublease income	(21)
Total lease expense	$	1,108

Prior to the adoption of ASU 2016-02, rent expense under operating leases was $1,064,000 for the year ended December 31, 2021, partially offset by rent income of $21,000 during the same period.

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


	December 31, 2022
Weighted average remaining lease term (in years)	5.38 years
Weighted average discount rate	2.18	%

The following table shows the future minimum lease payments under the Company’s operating lease arrangements as of December 31, 2022.


(in thousands)	December 31, 2022
2023	$	1,009
2024	984
2025	767
2026	665
2027	324
Thereafter	784
Total expected operating lease payments	4,533
Discount for present value of expected cash flows	(290)
Lease liability at December 31, 2022	$	4,243

Prior to the adoption of ASC 842, the Company accounted for operating leases under ASC 840. For comparability purposes in the year of adoption, undiscounted future minimum lease payments under the predecessor standard of ASC 840 as of December 31, 2021 are provided below.


(in thousands)	December 31, 2021
2022	$	1,025
2023	978
2024	951
2025	733
2026	604
Thereafter	1,094
Total minimum lease payments	$	5,385

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.

Loans and Allowance for Loan Losses - Credit Quality Indicators Related to the Company’s Loans by Class (Details) - USD ($)	Dec. 31, 2022	Dec. 31, 2021
Financing Receivable, Past Due [Line Items]
Total loans	$ 2,793,466,000	$ 1,936,066,000
Pass
Financing Receivable, Past Due [Line Items]
Total loans	2,771,150,000	1,916,805,000
Watch
Financing Receivable, Past Due [Line Items]
Total loans	21,886,000	8,647,000
Substandard
Financing Receivable, Past Due [Line Items]
Total loans	430,000	10,614,000
Doubtful
Financing Receivable, Past Due [Line Items]
Total loans	0	0
Commercial
Financing Receivable, Past Due [Line Items]
Total loans	2,394,674,000	1,586,232,000
Commercial \| Pass
Financing Receivable, Past Due [Line Items]
Total loans	2,379,766,000	1,575,006,000
Commercial \| Watch
Financing Receivable, Past Due [Line Items]
Total loans	14,802,000	1,970,000
Commercial \| Substandard
Financing Receivable, Past Due [Line Items]
Total loans	106,000	9,256,000
Commercial \| Doubtful
Financing Receivable, Past Due [Line Items]
Total loans	0	0
Commercial land and development
Financing Receivable, Past Due [Line Items]
Total loans	7,477,000	7,376,000
Commercial land and development \| Pass
Financing Receivable, Past Due [Line Items]
Total loans	7,477,000	7,376,000
Commercial land and development \| Watch
Financing Receivable, Past Due [Line Items]
Total loans	0	0
Commercial land and development \| Substandard
Financing Receivable, Past Due [Line Items]
Total loans	0	0
Commercial land and development \| Doubtful
Financing Receivable, Past Due [Line Items]
Total loans	0	0
Commercial construction
Financing Receivable, Past Due [Line Items]
Total loans	88,669,000	54,214,000
Commercial construction \| Pass
Financing Receivable, Past Due [Line Items]
Total loans	82,769,000	48,288,000
Commercial construction \| Watch
Financing Receivable, Past Due [Line Items]
Total loans	5,900,000	5,926,000
Commercial construction \| Substandard
Financing Receivable, Past Due [Line Items]
Total loans	0	0
Commercial construction \| Doubtful
Financing Receivable, Past Due [Line Items]
Total loans	0	0
Residential construction
Financing Receivable, Past Due [Line Items]
Total loans	6,693,000	7,388,000
Residential construction \| Pass
Financing Receivable, Past Due [Line Items]
Total loans	6,693,000	7,388,000
Residential construction \| Watch
Financing Receivable, Past Due [Line Items]
Total loans	0	0
Residential construction \| Substandard
Financing Receivable, Past Due [Line Items]
Total loans	0	0
Residential construction \| Doubtful
Financing Receivable, Past Due [Line Items]
Total loans	0	0
Residential
Financing Receivable, Past Due [Line Items]
Total loans	24,230,000	28,562,000
Residential \| Pass
Financing Receivable, Past Due [Line Items]
Total loans	24,055,000	28,384,000
Residential \| Watch
Financing Receivable, Past Due [Line Items]
Total loans	0	0
Residential \| Substandard
Financing Receivable, Past Due [Line Items]
Total loans	175,000	178,000
Residential \| Doubtful
Financing Receivable, Past Due [Line Items]
Total loans	0	0
Farmland
Financing Receivable, Past Due [Line Items]
Total loans	52,478,000	54,805,000
Farmland \| Pass
Financing Receivable, Past Due [Line Items]
Total loans	52,478,000	54,805,000
Farmland \| Watch
Financing Receivable, Past Due [Line Items]
Total loans	0	0
Farmland \| Substandard
Financing Receivable, Past Due [Line Items]
Total loans	0	0
Farmland \| Doubtful
Financing Receivable, Past Due [Line Items]
Total loans	0	0
Secured
Financing Receivable, Past Due [Line Items]
Total loans	165,186,000	137,062,000
Secured \| Pass
Financing Receivable, Past Due [Line Items]
Total loans	163,879,000	135,131,000
Secured \| Watch
Financing Receivable, Past Due [Line Items]
Total loans	1,184,000	751,000
Secured \| Substandard
Financing Receivable, Past Due [Line Items]
Total loans	123,000	1,180,000
Secured \| Doubtful
Financing Receivable, Past Due [Line Items]
Total loans	0	0
Unsecured
Financing Receivable, Past Due [Line Items]
Total loans	25,431,000	21,136,000
Unsecured \| Pass
Financing Receivable, Past Due [Line Items]
Total loans	25,431,000	21,136,000
Unsecured \| Watch
Financing Receivable, Past Due [Line Items]
Total loans	0	0
Unsecured \| Substandard
Financing Receivable, Past Due [Line Items]
Total loans	0	0
Unsecured \| Doubtful
Financing Receivable, Past Due [Line Items]
Total loans	0	0
PPP
Financing Receivable, Past Due [Line Items]
Total loans	0	22,124,000
PPP \| Pass
Financing Receivable, Past Due [Line Items]
Total loans		22,124,000
PPP \| Watch
Financing Receivable, Past Due [Line Items]
Total loans		0
PPP \| Substandard
Financing Receivable, Past Due [Line Items]
Total loans		0
PPP \| Doubtful
Financing Receivable, Past Due [Line Items]
Total loans		0
Consumer
Financing Receivable, Past Due [Line Items]
Total loans	28,628,000	17,167,000
Consumer \| Pass
Financing Receivable, Past Due [Line Items]
Total loans	28,602,000	17,167,000
Consumer \| Watch
Financing Receivable, Past Due [Line Items]
Total loans	0	0
Consumer \| Substandard
Financing Receivable, Past Due [Line Items]
Total loans	26,000	0
Consumer \| Doubtful
Financing Receivable, Past Due [Line Items]
Total loans	$ 0	$ 0

Interest Bearing Deposits - Interest Expense Recognized on Interest-bearing Deposits (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
Interest-bearing Deposits
Interest-bearing transaction accounts	$ 425	$ 155
Savings accounts	376	74
Money market accounts	6,477	1,797
Time accounts, $250 or more	2,804	42
Other time accounts	841	131
Total interest expense on interest-bearing deposits	$ 10,923	$ 2,199

Subsequent Events (Details) - Subsequent Event - USD ($)	Feb. 13, 2023	Jan. 19, 2023
Subsequent Event [Line Items]
Common stock declared (in USD per share)		$ 0.15
Dividends paid	$ 2,589,000

Loans and Allowance for Loan Losses - Allowance for Loan Losses (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Beginning Balance	$ 23,243	$ 22,189
Charge-offs	(2,619)	(1,143)
Recoveries	1,065	497
Provision (Benefit)	6,700	1,700
Ending Balance	28,389	23,243
Commercial
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Beginning Balance	12,869	9,358
Charge-offs	0	0
Recoveries	0	0
Provision (Benefit)	6,347	3,511
Ending Balance	19,216	12,869
Commercial land and development
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Beginning Balance	50	77
Charge-offs	0	0
Recoveries	0	0
Provision (Benefit)	4	(27)
Ending Balance	54	50
Commercial construction
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Beginning Balance	371	821
Charge-offs	0	0
Recoveries	0	0
Provision (Benefit)	274	(450)
Ending Balance	645	371
Residential construction
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Beginning Balance	50	87
Charge-offs	0	0
Recoveries	0	0
Provision (Benefit)	(1)	(37)
Ending Balance	49	50
Residential
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Beginning Balance	192	220
Charge-offs	0	0
Recoveries	0	0
Provision (Benefit)	(17)	(28)
Ending Balance	175	192
Farmland
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Beginning Balance	645	615
Charge-offs	0	0
Recoveries	0	0
Provision (Benefit)	(1)	30
Ending Balance	644	645
Secured
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Beginning Balance	6,859	9,476
Charge-offs	(1,690)	(822)
Recoveries	204	263
Provision (Benefit)	1,725	(2,058)
Ending Balance	7,098	6,859
Unsecured
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Beginning Balance	207	179
Charge-offs	(2)	0
Recoveries	0	0
Provision (Benefit)	(89)	28
Ending Balance	116	207
Paycheck Protection Program (“PPP”)
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Beginning Balance	0
Charge-offs	(21)
Recoveries	21
Provision (Benefit)	0
Ending Balance	0	0
Consumer and other
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Beginning Balance	889	632
Charge-offs	(906)	(321)
Recoveries	840	234
Provision (Benefit)	(476)	344
Ending Balance	347	889
Unallocated
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Beginning Balance	1,111	724
Charge-offs	0	0
Recoveries	0	0
Provision (Benefit)	(1,066)	387
Ending Balance	$ 45	$ 1,111

Fair Value of Assets and Liabilities - Fair Value of Assets and Liabilities Measured on a Recurring Basis (Details) - USD ($) $ in Thousands	Dec. 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	$ 115,988	$ 148,807
Assets: \| Fair Value, Recurring \| U.S. government agencies, mortgage-backed securities, obligations of states and political subdivisions, collateralized mortgage obligations, and corporate bonds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities available-for-sale, at fair value	115,988	148,807
Assets: \| Fair Value, Recurring \| U.S. government agencies, mortgage-backed securities, obligations of states and political subdivisions, collateralized mortgage obligations, and corporate bonds \| 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: \| Fair Value, Recurring \| U.S. government agencies, mortgage-backed securities, obligations of states and political subdivisions, collateralized mortgage obligations, and corporate bonds \| 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	115,988	148,807
Assets: \| Fair Value, Recurring \| U.S. government agencies, mortgage-backed securities, obligations of states and political subdivisions, collateralized mortgage obligations, and corporate bonds \| 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: \| Fair Value, Recurring \| Derivatives – interest rate swap
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative asset - interest rate swap	16	92
Assets: \| Fair Value, Recurring \| Derivatives – interest rate swap \| Quoted Prices in Active Markets for Identical Assets (Level 1)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative asset - interest rate swap	0	0
Assets: \| Fair Value, Recurring \| Derivatives – interest rate swap \| Significant Other Observable Inputs (Level 2)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative asset - interest rate swap	16	92
Assets: \| Fair Value, Recurring \| Derivatives – interest rate swap \| Significant Unobservable Inputs (Level 3)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative asset - interest rate swap	0	0
Liabilities: \| Fair Value, Recurring \| Derivatives – interest rate swap
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative liability - interest rate swap	16	92
Liabilities: \| Fair Value, Recurring \| Derivatives – interest rate swap \| Quoted Prices in Active Markets for Identical Assets (Level 1)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative liability - interest rate swap	0	0
Liabilities: \| Fair Value, Recurring \| Derivatives – interest rate swap \| Significant Other Observable Inputs (Level 2)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative liability - interest rate swap	16	92
Liabilities: \| Fair Value, Recurring \| Derivatives – interest rate swap \| Significant Unobservable Inputs (Level 3)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative liability - interest rate swap	$ 0	$ 0

Equity Incentive Plan - Summary of Unvested Restricted Shares (Details) - Restricted Stock - $ / shares	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
Shares
Beginning of the period balance (in shares)	127,751	11,568
Grants in period (in shares)	23,639	174,347
Vested in period (in shares)	(48,003)	(53,642)
Forfeited in period (in shares)	(6,561)	(4,522)
End of the period balance (in shares)	96,826	127,751
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)	28.29	19.97
Shares vested (in USD per share)	23.07	20.35
Shares forfeited (in USD per share)	21.29	19.33
End of the period balance (in USD per share)	$ 20.34	$ 19.95

Premises and Equipment, Net - Narrative (Details) - USD ($)	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
Property, Plant and Equipment [Abstract]
Depreciation and amortization	$ 649,000	$ 607,000

Loans and Allowance for Loan Losses - Non-accrual Loans Segregated by Class (Details) - USD ($) $ in Thousands	Dec. 31, 2022	Dec. 31, 2021
Financing Receivable, Past Due [Line Items]
Total non-accrual loans	$ 404	$ 588
Commercial
Financing Receivable, Past Due [Line Items]
Total non-accrual loans	106	122
Residential
Financing Receivable, Past Due [Line Items]
Total non-accrual loans	175	178
Secured
Financing Receivable, Past Due [Line Items]
Total non-accrual loans	$ 123	$ 288

Basis of Presentation - Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Net income	$ 44,801	$ 42,441
Weighted average basic common shares outstanding (in shares)	17,128,282	14,972,637
Add: Dilutive effects of assumed vesting of restricted stock (in shares)	37,328	22,576
Weighted average diluted common shares outstanding (in shares)	17,165,610	14,995,213
Income per common share:
Basic EPS (in USD per share)	$ 2.61	$ 2.83
Diluted EPS (in USD per share)	$ 2.61	$ 2.83

- Definition

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

+ References

Reference 1: 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 https://asc.fasb.org/extlink&oid=126732423&loc=SL123482106-238011

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 250
-SubTopic 10
-Section 50
-Paragraph 3
-URI https://asc.fasb.org/extlink&oid=124431687&loc=d3e22583-107794

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
-Topic 250
-SubTopic 10
-Section 50
-Paragraph 11
-Subparagraph (b)
-URI https://asc.fasb.org/extlink&oid=124431687&loc=d3e22694-107794

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 260
-SubTopic 10
-Section 45
-Paragraph 10
-URI https://asc.fasb.org/extlink&oid=126958026&loc=d3e1448-109256

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 250
-SubTopic 10
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-Paragraph 4
-URI https://asc.fasb.org/extlink&oid=124431687&loc=d3e22595-107794

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
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Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 260
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-URI https://asc.fasb.org/extlink&oid=126958026&loc=d3e1337-109256

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 815
-SubTopic 40
-Section 65
-Paragraph 1
-Subparagraph (f)
-URI https://asc.fasb.org/extlink&oid=126732423&loc=SL123482106-238011

Reference 9: http://www.xbrl.org/2003/role/exampleRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 260
-SubTopic 10
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-URI https://asc.fasb.org/extlink&oid=128363288&loc=d3e4984-109258

Reference 10: 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 https://asc.fasb.org/extlink&oid=120400993&loc=SL114874131-224263

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 260
-SubTopic 10
-Section 55
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-URI https://asc.fasb.org/extlink&oid=128363288&loc=d3e3842-109258

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 250
-SubTopic 10
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-Paragraph 7
-Subparagraph (a)
-URI https://asc.fasb.org/extlink&oid=124431687&loc=d3e22644-107794

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 260
-SubTopic 10
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-Paragraph 1
-Subparagraph (a)
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Reference 14: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 220
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-Section S99
-Paragraph 2
-Subparagraph (SX 210.5-03(25))
-URI https://asc.fasb.org/extlink&oid=126953954&loc=SL114868664-224227

Reference 15: http://www.xbrl.org/2003/role/disclosureRef
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+ Details

- Definition

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.

+ References

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- Definition

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

+ References

+ Details

Interest-Bearing Deposits (Tables)

12 Months Ended

Dec. 31, 2022

Interest-bearing Deposits

Schedule of Interest-Bearing Deposits

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


(in thousands)	2022		2021
Interest-bearing transaction accounts	$	240,131	$	278,406
Savings accounts	154,581		88,536
Money market accounts	1,073,532		912,558
Time accounts, $250 or more	198,159		77,868
Other time accounts	144,355		26,404
Total interest-bearing deposits	$	1,810,758	$	1,383,772

Time Deposit Maturities

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


(in thousands)
2023	$	339,306
2024	1,797
2025	100
2026	1,311
2027	—
Total time deposits	$	342,514

Schedule of Composition of Network Deposits

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


(in thousands)	2022		2021
CDARS	$	13,248	$	22,411
ICS	272,719		307,636
Total network deposits	$	285,967	$	330,047

Interest expense recognized on interest-bearing deposits

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


(in thousands)	2022		2021
Interest-bearing transaction accounts	$	425	$	155
Savings accounts	376		74
Money market accounts	6,477		1,797
Time accounts, $250 or more	2,804		42
Other time accounts	841		131
Total interest expense on interest-bearing deposits	$	10,923	$	2,199

Premises and Equipment, Net

12 Months Ended

Dec. 31, 2022

Property, Plant and Equipment [Abstract]

Premises and Equipment, Net

Premises and equipment, net, were as follows as of December 31, 2022 and 2021:


(in thousands)	2022		2021
Furniture, fixtures, and equipment	$	3,762	$	3,314
Tenant improvements	1,994		1,973
	5,756		5,287
Less: Accumulated depreciation and amortization	4,151		3,514
Premises and equipment, net	$	1,605	$	1,773

Depreciation expense for occupancy, furniture, fixtures, and equipment was $649,000 and $607,000 for the years ended December 31, 2022 and 2021, respectively.

Premises and Equipment, Net - Schedule of Premises and Equipment (Details) - USD ($) $ in Thousands	Dec. 31, 2022	Dec. 31, 2021
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	$ 5,756	$ 5,287
Less: Accumulated depreciation and amortization	4,151	3,514
Premises and equipment, net	1,605	1,773
Furniture, fixtures, and equipment
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	3,762	3,314
Tenant improvements
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	$ 1,994	$ 1,973

Commitments and Contingencies - Schedule of Other Commitments (Details) - USD ($) $ in Thousands	Dec. 31, 2022	Dec. 31, 2021
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Total commitments and standby letters of credit	$ 329,148	$ 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	147,021	137,354
Undisbursed construction loans
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Total commitments and standby letters of credit	80,726	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	88,066	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	10,399	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	1,068	3,427
Other
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Total commitments and standby letters of credit	$ 1,868	$ 3,764

Parent Company Only Condensed Financial Information - Statement of Income (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
Condensed Financial Statements, Captions [Line Items]
Dividends from banking subsidiary	$ 117,918	$ 81,583
Interest expense	14,848	3,972
Income before provision for income taxes	62,858	47,148
Income tax benefit	(18,057)	(4,707)
Net income	44,801	42,441
Parent Company
Condensed Financial Statements, Captions [Line Items]
Dividends from banking subsidiary	16,301	27,630
Interest expense	3,740	1,773
Other expense	2,836	3,559
Income before provision for income taxes	9,725	22,298
Income tax benefit	2,094	812
Equity in undistributed banking subsidiary income	32,982	19,331
Net income	$ 44,801	$ 42,441

- 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.

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+ Details

- Definition

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

+ References + Details

- Definition

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

+ References

+ Details

Long Term Debt and Other Borrowings - Narrative (Details)	Dec. 15, 2022	Aug. 17, 2022 USD ($)	Dec. 31, 2022 USD ($) federalFund correspondentBank	Nov. 05, 2022 USD ($) series	Dec. 31, 2021 USD ($) federalFund correspondentBank
Debt Instrument [Line Items]
Subordinated notes and other liabilities			$ 73,606,000		$ 28,386,000
Number of unsecured federal funds \| federalFund			7		5
Number of correspondent banks \| correspondentBank			7		5
FHLB Agreement
Debt Instrument [Line Items]
Long-term line of credit			$ 100,000,000		$ 0
Subordinated Debt
Debt Instrument [Line Items]
Number of series \| series				2
Debt issuance costs			1,454,000
Accumulated amortization of debt issuance costs			$ 61,000
Subordinated Debt \| Fixed-to-floating Rate Subordinated Notes Issued August 2022
Debt Instrument [Line Items]
Subordinated notes and other liabilities		$ 75,000,000
Subordinated borrowing, interest rate (in percent)		6.00%
Debt instrument, floating interest rate (in percent)			8.03%
Subordinated Debt \| Fixed-to-floating Rate Subordinated Notes Issued August 2022 \| Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate
Debt Instrument [Line Items]
Basis spread on variable rate		3.29%
Subordinated Debt \| Entity Controlled By Existing And Former Board Members And Affiliates
Debt Instrument [Line Items]
Debt instrument, face amount		$ 19,250,000
Subordinated Debt \| Fixed-to-floating Rate Subordinated Notes Issued Nov 2019
Debt Instrument [Line Items]
Aggregate principal amount of debt				$ 3,750,000
Percentage of principal amount redeemed (in percent)	100.00%
Subordinated Debt \| Fixed-to-floating Rate Subordinated Notes Issued Sep 2017
Debt Instrument [Line Items]
Aggregate principal amount of debt				$ 25,000,000
Percentage of principal amount redeemed (in percent)	100.00%
Line of Credit
Debt Instrument [Line Items]
Long-term line of credit			$ 0		0
Line of Credit \| Federal Reserve Discount Window
Debt Instrument [Line Items]
Maximum borrowing capacity			21,868,000		16,999,000
Line of credit, amount outstanding			0		0
Line of Credit \| FHLB Agreement
Debt Instrument [Line Items]
Remaining borrowing capacity			216,338,000		275,785,000
Line of Credit \| Letters Of Credit Pledged As Security For State Of California Deposits
Debt Instrument [Line Items]
Letters of credit outstanding			206,500,000		80,500,000
Line of Credit \| Secure Local Agency Deposit
Debt Instrument [Line Items]
Letters of credit outstanding			480,000,000		340,000,000
Line of Credit \| Five Unsecured Federal Funds Line Of Credit
Debt Instrument [Line Items]
Long-term line of credit					150,000,000
Line of Credit \| Seven Unsecured Federal Funds Line Of Credit
Debt Instrument [Line Items]
Long-term line of credit			190,000,000
Letter of Credit \| FHLB Agreement
Debt Instrument [Line Items]
Maximum borrowing capacity			1,002,838,000		696,285,000
Letters of credit outstanding			$ 686,500,000		$ 420,500,000

Commitments and Contingencies - Schedule of Future Minimum Lease Payments (Details) - USD ($)	Dec. 31, 2022	Dec. 31, 2021
Commitments and Contingencies Disclosure [Abstract]
2023	$ 1,009,000
2024	984,000
2025	767,000
2026	665,000
2027	324,000
Thereafter	784,000
Total expected operating lease payments	4,533,000
Discount for present value of expected cash flows	(290,000)
Lease liability at December 31, 2022	$ 4,243,000	$ 0

Basis of Presentation (Policies)

12 Months Ended

Dec. 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

Cash and Cash Equivalents

Securities Available-for-sale

Securities Available-for-Sale

Securities Held-to-maturity

Securities Held-to-Maturity

Loans and Allowance for Loan Losses

Loans are reported at the principal amount outstanding, net of deferred loan fees and costs and the allowance for loan losses. Interest on loans is accrued daily based on the principal outstanding.

Federal Home Loan Bank Stock

Premises and Equipment


Equipment			3 - 12 years
Furniture and fixtures			5 - 10 years
Leasehold improvements			5 - 15 years
Automobiles			3 - 5 years

Transfers of Financial Assets

Loan Commitments and Related Financial Instruments

Stock-Based Compensation

Supplemental Executive Retirement Plan

Income Taxes

Derivatives

Comprehensive Income or Loss

Earnings Per Common Share ("EPS")

Earnings Per Common Share (“EPS”)


(in thousands, except share and per share data)	2022		2021
Net income	$	44,801	$	42,441
Weighted average basic common shares outstanding	17,128,282		14,972,637
Add: Dilutive effects of assumed vesting of restricted stock	37,328		22,576
Weighted average diluted common shares outstanding	17,165,610		14,995,213
Income per common share:
Basic EPS	$	2.61	$	2.83
Diluted EPS	$	2.61	$	2.83

Anti-dilutive shares, which are excluded from the dilutive EPS calculation, were deemed to be immaterial.

a C Corporation for the entirety of the year. The following reconciliation table provides a detailed calculation of pro forma EPS:


(in thousands, except share and per share data)	2022		2021
Net income before provision for income taxes - GAAP	$	62,858	$	47,148
Less: Actual/pro forma provision for income taxes	18,057		9,335
Actual/pro forma net income	44,801		37,813
Weighted average basic common shares outstanding	17,128,282		14,972,637
Add: Dilutive effects of assumed vesting of restricted stock	37,328		22,576
Weighted average diluted common shares outstanding	17,165,610		14,995,213
Income per common share:
Basic EPS	$	2.61	$	2.53
Diluted EPS	$	2.61	$	2.52

Subordinated Notes

Fair Value of Financial Instruments

Fair Value Measurements

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 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.

As a result, if other assumptions had been used, the Company’s recorded earnings or disclosures could have been materially different from those reflected in these consolidated financial statements.

Subsequent Events

Subsequent EventsThe Company has evaluated events and transactions subsequent to December 31, 2022 for recognition or disclosure.

Reclassifications

Capital Requirements and Restrictions on Retained Earnings (Tables)

12 Months Ended

Dec. 31, 2022

Banking Regulation, Risk-Based Information [Abstract]

Schedule of Compliance with Regulatory Capital Requirements under Banking Regulations


Capital Ratios for Bancorp (dollars in thousands)	Actual Ratio				Required for Capital Adequacy Purposes1				Ratio to be Well- Capitalized under Prompt Corrective Action Provisions
	Amount		Ratio		Amount		Ratio		Amount	Ratio
December 31, 2022
Total capital (to risk-weighted assets)	$	366,113	12.46	%	$	235,065	8.00	%	N/A	N/A
Tier 1 capital (to risk-weighted assets)	$	263,993	8.99	%	$	176,191	6.00	%	N/A	N/A
Common equity tier 1 capital (to risk-weighted assets)	$	263,993	8.99	%	$	132,144	4.50	%	N/A	N/A
Tier 1 leverage	$	263,993	8.60	%	$	122,788	4.00	%	N/A	N/A
December 31, 2021
Total capital (to risk-weighted assets)	$	285,128	13.98	%	$	163,177	8.00	%	N/A	N/A
Tier 1 capital (to risk-weighted assets)	$	233,397	11.44	%	$	122,382	6.00	%	N/A	N/A
Common equity tier 1 capital (to risk-weighted assets)	$	233,397	11.44	%	$	91,787	4.50	%	N/A	N/A
Tier 1 leverage	$	233,397	9.47	%	$	98,600	4.00	%	N/A	N/A


Capital Ratios for the Bank (dollars in thousands)	Actual Ratio				Required for Capital Adequacy Purposes				Ratio to be Well- Capitalized under Prompt Corrective Action Provisions
	Amount		Ratio		Amount		Ratio		Amount		Ratio
December 31, 2022
Total capital (to risk-weighted assets)	$	356,301	12.14	%	$	234,795	8.00	%	$	293,494	10.00	%
Tier 1 capital (to risk-weighted assets)	$	327,788	11.17	%	$	176,072	6.00	%	$	234,763	8.00	%
Common equity tier 1 capital (to risk-weighted assets)	$	327,788	11.17	%	$	132,054	4.50	%	$	190,745	6.50	%
Tier 1 leverage	$	327,788	10.69	%	$	122,652	4.00	%	$	153,315	5.00	%
December 31, 2021
Total capital (to risk-weighted assets)	$	279,152	13.69	%	$	163,078	8.00	%	$	203,848	10.00	%
Tier 1 capital (to risk-weighted assets)	$	255,807	12.55	%	$	122,309	6.00	%	$	163,078	8.00	%
Common equity tier 1 capital (to risk-weighted assets)	$	255,807	12.55	%	$	91,731	4.50	%	$	132,501	6.50	%
Tier 1 leverage	$	255,807	10.38	%	$	98,555	4.00	%	$	123,193	5.00	%


1			Prior to September 30, 2022, Bancorp operated under the Small Bank Holding Company Policy Statement and therefore, was not subject to Basel III capital adequacy requirements. The listed capital adequacy ratios exclude capital conservation buffers.

Loans and Allowance for Loan Losses - Balance of Each Major Product Type (Details) - USD ($)	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2020
Financing Receivable, Past Due [Line Items]
Subtotal	$ 2,793,466,000	$ 1,936,066,000
Less: Net deferred loan fees	2,140,000	1,606,000
Less: Allowance for loan losses	28,389,000	23,243,000	$ 22,189,000
Loans held for investment, net of allowance for loan losses	2,762,937,000	1,911,217,000
Commercial
Financing Receivable, Past Due [Line Items]
Subtotal	2,394,674,000	1,586,232,000
Less: Allowance for loan losses	19,216,000	12,869,000	9,358,000
Commercial land and development
Financing Receivable, Past Due [Line Items]
Subtotal	7,477,000	7,376,000
Less: Allowance for loan losses	54,000	50,000	77,000
Commercial construction
Financing Receivable, Past Due [Line Items]
Subtotal	88,669,000	54,214,000
Less: Allowance for loan losses	645,000	371,000	821,000
Residential construction
Financing Receivable, Past Due [Line Items]
Subtotal	6,693,000	7,388,000
Less: Allowance for loan losses	49,000	50,000	87,000
Residential
Financing Receivable, Past Due [Line Items]
Subtotal	24,230,000	28,562,000
Less: Allowance for loan losses	175,000	192,000	220,000
Farmland
Financing Receivable, Past Due [Line Items]
Subtotal	52,478,000	54,805,000
Less: Allowance for loan losses	644,000	645,000	615,000
Secured
Financing Receivable, Past Due [Line Items]
Subtotal	165,186,000	137,062,000
Less: Allowance for loan losses	7,098,000	6,859,000	9,476,000
Unsecured
Financing Receivable, Past Due [Line Items]
Subtotal	25,431,000	21,136,000
Less: Allowance for loan losses	116,000	207,000	179,000
Paycheck Protection Program (“PPP”)
Financing Receivable, Past Due [Line Items]
Subtotal	0	22,124,000
Less: Allowance for loan losses	0	0
Consumer and other
Financing Receivable, Past Due [Line Items]
Subtotal	28,628,000	17,167,000
Less: Allowance for loan losses	$ 347,000	$ 889,000	$ 632,000

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (Parenthetical) - $ / shares	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
Statement of Stockholders' Equity [Abstract]
Cash dividends paid (in USD per share)	$ 1.05	$ 4.55

Capital Requirements and Restrictions on Retained Earnings - Narrative (Details)	12 Months Ended
	Dec. 31, 2022 USD ($)	Dec. 31, 2021 USD ($)	Jun. 30, 2022 USD ($)
Federal Home Loan Bank, Advances, Branch of FHLB Bank [Line Items]
Assets	$ 3,227,159,000	$ 2,556,761,000
Common equity tier 1 capital (to risk-weighted assets), Actual Ratio, Ratio (in percent)	0.0899	0.1144
Common equity tier 1 capital (to risk-weighted assets), Required for Capital Adequacy Purposes, Ratio (in percent)	0.0450	0.0450
Tier 1 capital (to risk-weighted assets), Actual Ratio, Ratio (in percent)	0.0899	0.1144
Tier 1 capital (to risk-weighted assets), Required for Capital Adequacy Purposes, Ratio (in percent)	0.0600	0.0600
Total capital (to risk-weighted assets), Actual Ratio, Ratio (in percent)	0.1246	0.1398
Total capital (to risk-weighted assets), Required for Capital Adequacy Purposes, Ratio (in percent)	0.0800	0.0800
Tier 1 leverage, Required for Capital Adequacy Purposes, Ratio (in percent)	0.0400	0.0400
Maximum dividend distribution	$ 33,867,000	$ 15,464,000
Subsidiaries
Federal Home Loan Bank, Advances, Branch of FHLB Bank [Line Items]
Common equity tier 1 capital (to risk-weighted assets), Actual Ratio, Ratio (in percent)	0.1117	0.1255
Common equity tier 1 capital (to risk-weighted assets), Required for Capital Adequacy Purposes, Ratio (in percent)	0.0450	0.0450
Common equity tier 1 capital, capital conservation buffer (in percent)	0.0250
Tier 1 capital (to risk-weighted assets), Actual Ratio, Ratio (in percent)	0.1117	0.1255
Tier 1 capital (to risk-weighted assets), Required for Capital Adequacy Purposes, Ratio (in percent)	0.0600	0.0600
Tier 1 capital (to risk-weighted assets), capital conservation buffer (in percent)	0.0250
Total capital (to risk-weighted assets), Actual Ratio, Ratio (in percent)	0.1214	0.1369
Total capital (to risk-weighted assets), Required for Capital Adequacy Purposes, Ratio (in percent)	0.0800	0.0800
Total capital (to risk-weighted assets), capital conservation buffer (in percent)	0.0250
Tier 1 leverage, Required for Capital Adequacy Purposes, Ratio (in percent)	0.0400	0.0400
Minimum \| Subsidiaries
Federal Home Loan Bank, Advances, Branch of FHLB Bank [Line Items]
Common equity tier 1 capital (to risk-weighted assets), Actual Ratio, Ratio (in percent)	0.0700
Tier 1 capital (to risk-weighted assets), Actual Ratio, Ratio (in percent)	0.0850
Total capital (to risk-weighted assets), Actual Ratio, Ratio (in percent)	0.1050
Tier 1 leverage, Required for Capital Adequacy Purposes, Ratio (in percent)	0.0400
Maximum
Federal Home Loan Bank, Advances, Branch of FHLB Bank [Line Items]
Assets	$ 3,000,000,000		$ 3,000,000,000

Parent Company Only Condensed Financial Information - Statement of Cash Flows (Details ) - USD ($)			12 Months Ended
	Mar. 17, 2022	May 03, 2021	Dec. 31, 2022	Dec. 31, 2021
Cash flows from operating activities:
Net income			$ 44,801,000	$ 42,441,000
Adjustments to reconcile net income to net cash provided by operating activities:
Stock compensation expense for employee and directors			1,099,000	1,440,000
Amortization of subordinated notes issuance costs			122,000	66,000
Extinguishment of redeemed subordinated note issuance costs			302,000	0
Net cash provided by operating activities			45,975,000	28,657,000
Cash flows from investing activities:
Net cash used in investing activities			(836,922,000)	(455,011,000)
Cash flows from financing activities:
Proceeds from sale of stock			0	111,243,000
Cash dividends paid	$ (4,953,000)	$ (26,967,000)	(15,301,000)	(51,942,000)
Proceeds from subordinated note issuance			75,000,000	0
Subordinated note issuance costs			(1,454,000)	0
Net cash provided by financing activities			625,609,000	561,190,000
Net change in cash and cash equivalents			(165,338,000)	134,836,000
Director
Adjustments to reconcile net income to net cash provided by operating activities:
Stock compensation expense for employee and directors			447,000	846,000
Employee
Adjustments to reconcile net income to net cash provided by operating activities:
Stock compensation expense for employee and directors			652,000	594,000
Parent Company
Cash flows from operating activities:
Net income			44,801,000	42,441,000
Adjustments to reconcile net income to net cash provided by operating activities:
Equity in undistributed banking subsidiary income			(32,984,000)	(19,331,000)
Amortization of subordinated notes issuance costs			122,000	66,000
Extinguishment of redeemed subordinated note issuance costs			302,000	0
Change in other assets			(2,168,000)	(631,000)
Change in accrued expenses and other liabilities			1,385,000	(405,000)
Net cash provided by operating activities			12,557,000	23,580,000
Cash flows from investing activities:
Investment in subsidiary			(39,000,000)	(80,800,000)
Net cash used in investing activities			(39,000,000)	(80,800,000)
Cash flows from financing activities:
Proceeds from sale of stock			0	111,243,000
Cash dividends paid			(15,301,000)	(51,942,000)
Proceeds from subordinated note issuance			75,000,000	0
Subordinated note issuance costs			(1,454,000)	0
Subordinated note redemption			(28,750,000)	0
Net cash provided by financing activities			29,495,000	59,301,000
Net change in cash and cash equivalents			3,052,000	2,081,000
Cash and cash equivalents at beginning of period			5,636,000	3,555,000
Cash and cash equivalents at end of period			8,688,000	5,636,000
Parent Company \| Director
Adjustments to reconcile net income to net cash provided by operating activities:
Stock compensation expense for employee and directors			447,000	846,000
Parent Company \| Employee
Adjustments to reconcile net income to net cash provided by operating activities:
Stock compensation expense for employee and directors			$ 652,000	$ 594,000

Interest-Bearing Deposits - Narrative (Details) - USD ($)	Dec. 31, 2022	Dec. 31, 2021
Interest-bearing Deposits
Interest-bearing domestic deposit, time deposits	$ 342,514,000	$ 104,272,000
Brokered time deposits	124,993,000	0
One-way deposits	$ 0	$ 0

Subsequent Events	12 Months Ended
Subsequent Events	Dec. 31, 2022
Subsequent Events [Abstract]
Subsequent Events	Subsequent EventsOn January 19, 2023, the board of directors declared a $0.15 per common share dividend for shareholders of record as of February 6, 2023, which was paid on February 13, 2023 in the amount of $2,589,000.

Related Party Transactions - Summary of Loans (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
Schedule Of Related Party Loans [Roll Forward]
Beginning balance	$ 9,418	$ 2,048
New loans or advances	340	7,828
Repayments	(3,146)	(458)
Transfers out	(362)	0
Ending balance	$ 6,250	$ 9,418

- Definition

For an unclassified balance sheet, amounts due from related parties including affiliates, employees, joint ventures, officers and stockholders, immediate families thereof, and pension funds.

+ References

Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(k)(1))
-URI https://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 850
-SubTopic 10
-Section 50
-Paragraph 1
-Subparagraph (d)
-URI https://asc.fasb.org/extlink&oid=6457730&loc=d3e39549-107864

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 10
-Section S99
-Paragraph 1A
-Subparagraph (SX 210.13-01(a)(4)(iv))
-URI https://asc.fasb.org/extlink&oid=126975872&loc=SL124442526-122756

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 10
-Section S99
-Paragraph 1A
-Subparagraph (SX 210.13-01(a)(5))
-URI https://asc.fasb.org/extlink&oid=126975872&loc=SL124442526-122756

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 10
-Section S99
-Paragraph 1B
-Subparagraph (SX 210.13-02(a)(5))
-URI https://asc.fasb.org/extlink&oid=126975872&loc=SL124442552-122756

Reference 6: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 942
-SubTopic 210
-Section S99
-Paragraph 1
-Subparagraph (SX 210.9-03.10(3))
-URI https://asc.fasb.org/extlink&oid=126897435&loc=d3e534808-122878

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 210
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.5-02(3)(a)(2))
-URI https://asc.fasb.org/extlink&oid=120391452&loc=d3e13212-122682

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 10
-Section S99
-Paragraph 1B
-Subparagraph (SX 210.13-02(a)(4)(iii)(C))
-URI https://asc.fasb.org/extlink&oid=126975872&loc=SL124442552-122756

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 10
-Section S99
-Paragraph 1B
-Subparagraph (SX 210.13-02(a)(4)(iv))
-URI https://asc.fasb.org/extlink&oid=126975872&loc=SL124442552-122756

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 10
-Section S99
-Paragraph 1A
-Subparagraph (SX 210.13-01(a)(4)(iii)(B))
-URI https://asc.fasb.org/extlink&oid=126975872&loc=SL124442526-122756

Reference 11: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 944
-SubTopic 210
-Section S99
-Paragraph 1
-Subparagraph (SX 210.7-03.3)
-URI https://asc.fasb.org/extlink&oid=126734703&loc=d3e572229-122910

+ Details

Investment Securities - Sales of Investment Securities (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
Investments, Debt and Equity Securities [Abstract]
Sales proceeds	$ 1,623	$ 47,096
Gross realized gains	$ 5	$ 724

Loans and Allowance for Loan Losses (Tables)

12 Months Ended

Dec. 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)	2022		2021
Real estate:
Commercial	$	2,394,674	$	1,586,232
Commercial land and development	7,477		7,376
Commercial construction	88,669		54,214
Residential construction	6,693		7,388
Residential	24,230		28,562
Farmland	52,478		54,805
Commercial:
Secured	165,186		137,062
Unsecured	25,431		21,136
Paycheck Protection Program (“PPP”)	—		22,124
Consumer and other	28,628		17,167
Subtotal	2,793,466		1,936,066
Less: Net deferred loan fees	2,140		1,606
Less: Allowance for loan losses	28,389		23,243
Loans held for investment, net of allowance for loan losses	$	2,762,937	$	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 December 31, 2022:


(in thousands)	Pass		Watch		Substandard		Doubtful		Total
Real estate:
Commercial	$	2,379,766	$	14,802	$	106	$	—	$	2,394,674
Commercial land and development	7,477		—		—		—		7,477
Commercial construction	82,769		5,900		—		—		88,669
Residential construction	6,693		—		—		—		6,693
Residential	24,055		—		175		—		24,230
Farmland	52,478		—		—		—		52,478
Commercial:
Secured	163,879		1,184		123		—		165,186
Unsecured	25,431		—		—		—		25,431
Consumer	28,602		—		26		—		28,628
Total	$	2,771,150	$	21,886	$	430	$	—	$	2,793,466

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 December 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	$	—	$	—	$	—	$	2,394,674	$	2,394,674
Commercial land and development	—		—		—		7,477		7,477
Commercial construction	—		—		—		88,669		88,669
Residential construction	—		—		—		6,693		6,693
Residential	—		—		—		24,230		24,230
Farmland	—		—		—		52,478		52,478
Commercial:
Secured	—		—		—		165,186		165,186
Unsecured	—		—		—		25,431		25,431
Consumer and other	194		—		194		28,434		28,628
Total	$	194	$	—	$	194	$	2,793,272	$	2,793,466

The age analysis of past due loans by class as of December 31, 2021 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	$	—	$	—	$	—	$	1,586,232	$	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 December 31, 2022 and 2021 consisted of the following:


	December 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	$	106	$	106	$	—	$	122	$	122	$	—
Residential	175		175		—		178		178		—
Commercial:
Secured	—		—		—		116		116		—

	281		281		—		416		416		—

With an allowance recorded:
Commercial:
Secured	123		123		123		172		172		172
	123		123		123		172		172		172

Total by category:
Real estate:
Commercial	106		106		—		122		122		—
Residential	175		175		—		178		178		—
Commercial:
Secured	123		123		123		288		288		172

Total impaired loans	$	404	$	404	$	123	$	588	$	588	$	172

Information related to impaired loans for the years ended December 31, 2022 and 2021 consisted of the following:


	Years ended December 31,
	2022				2021
(in thousands)	Average Recorded Investment		Interest Income Recognized			Average Recorded Investment		Interest Income Recognized
With no related allowance recorded:
Real estate:
Commercial	$	113	$	—		$	129	$	—
Residential	176		—			181		—
Commercial:
Secured	28		—			120		—
Consumer and other	8		—			—		—
	325		—			430		—

With an allowance recorded:
Commercial:
Secured	348		—			78		—
Consumer and other	2		—			9		—
	350		—			87		—

Total by category:
Real estate:
Commercial	113		—			129		—
Residential	176		—			181		—
Commercial:
Secured	376		—			198		—
Consumer and other	10		—			9		—
Total impaired loans	$	675	$	—		$	517	$	—

Schedule of Non-accrual Loans

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


(in thousands)	2022		2021
Real estate:
Commercial	$	106	$	122
Residential	175		178
Commercial:
Secured	123		288
Total non-accrual loans	$	404	$	588

Disclosure of Activity in the Allowance For Loan Losses

The following table discloses activity in the allowance for loan losses for the year ended December 31, 2022.


(in thousands)	Beginning Balance		Charge-offs		Recoveries		Provision (Benefit)		Ending Balance
Real estate:
Commercial	$	12,869	$	—	$	—	$	6,347	$	19,216
Commercial land and development	50		—		—		4		54
Commercial construction	371		—		—		274		645
Residential construction	50		—		—		(1)		49
Residential	192		—		—		(17)		175
Farmland	645		—		—		(1)		644
Commercial:
Secured	6,859		(1,690)		204		1,725		7,098
Unsecured	207		(2)		—		(89)		116
PPP	—		(21)		21		—		—
Consumer and other	889		(906)		840		(476)		347
Unallocated	1,111		—		—		(1,066)		45
Total	$	23,243	$	(2,619)	$	1,065	$	6,700	$	28,389

The following table discloses activity in the allowance for loan losses for the year ended December 31, 2021.


(in thousands)	Beginning Balance		Charge-offs		Recoveries		Provision (Benefit)		Ending Balance
Real estate:
Commercial	$	9,358	$	—	$	—	$	3,511	$	12,869
Commercial land and development	77		—		—		(27)		50
Commercial construction	821		—		—		(450)		371
Residential construction	87		—		—		(37)		50
Residential	220		—		—		(28)		192
Farmland	615		—		—		30		645
Commercial:
Secured	9,476		(822)		263		(2,058)		6,859
Unsecured	179		—		—		28		207

Consumer and other	632		(321)		234		344		889
Unallocated	724		—		—		387		1,111
Total	$	22,189	$	(1,143)	$	497	$	1,700	$	23,243

The following table summarizes the allocation of the allowance for loan losses by impairment methodology as of December 31, 2022.


	Ending allowance balance allocated to:						Ending balance of:
(in thousands)	Loans individually evaluated for impairment		Loans collectively evaluated for impairment		Total loans		Loans individually evaluated for impairment		Loans collectively evaluated for impairment		Total loans
Real estate:
Commercial	$	—	$	19,216	$	19,216	$	106	$	2,394,568	$	2,394,674
Commercial land and development	—		54		54		—		7,477		7,477
Commercial construction	—		645		645		—		88,669		88,669
Residential construction	—		49		49		—		6,693		6,693
Residential	—		175		175		175		24,055		24,230
Farmland	—		644		644		—		52,478		52,478
Commercial:
Secured	123		6,975		7,098		123		165,063		165,186
Unsecured	—		116		116		—		25,431		25,431

Consumer and other	—		347		347		—		28,628		28,628
Unallocated	—		45		45		—		—		—
Total	$	123	$	28,266	$	28,389	$	404	$	2,793,062	$	2,793,466

The following table summarizes the allocation of the allowance for loan losses by impairment methodology as of December 31, 2021.


	Ending allowance balance allocated to:						Ending balance of:
(in thousands)	Loans individually evaluated for impairment		Loans collectively evaluated for impairment		Total loans		Loans individually evaluated for impairment		Loans collectively evaluated for impairment		Total loans
Real estate:
Commercial	$	—	$	12,869	$	12,869	$	122	$	1,586,110	$	1,586,232
Commercial land and development	—		50		50		—		7,376		7,376
Commercial construction	—		371		371		—		54,214		54,214
Residential construction	—		50		50		—		7,388		7,388
Residential	—		192		192		178		28,384		28,562
Farmland	—		645		645		—		54,805		54,805
Commercial:
Secured	172		6,687		6,859		288		136,774		137,062
Unsecured	—		207		207		—		21,136		21,136
PPP	—		—		—		—		22,124		22,124
Consumer and other	—		889		889		—		17,167		17,167
Unallocated	—		1,111		1,111		—		—		—
Total	$	172	$	23,071	$	23,243	$	588	$	1,935,478	$	1,936,066

Interest Bearing Deposits - Maturities of Time Deposits (Details) - USD ($)	Dec. 31, 2022	Dec. 31, 2021
Interest-bearing Deposits
2023	$ 339,306,000
2024	1,797,000
2025	100,000
2026	1,311,000
2027	0
Total time deposits	$ 342,514,000	$ 104,272,000

401(k) Benefit Plan	12 Months Ended
401(k) Benefit Plan	Dec. 31, 2022
Retirement Benefits [Abstract]
401(k) Benefit Plan	401(k) Benefit PlanA 401(k) benefit plan covers substantially all employees and allows voluntary employee contributions up to the lesser of 80% of compensation or the annually adjusted IRS dollar limit. These voluntary contributions are matched equal to 100% of the first 3% of the employee’s compensation contributed and 50% of contributions exceeding 3% of eligible compensation, not to exceed 5% of the total eligible compensation. The employees’ voluntary contributions and the Company’s matching contributions are 100% vested immediately. The expense related to matching employees’ contributions for 2022 and 2021 was $634,000 and $593,000, respectively.

- Definition

The entire disclosure for retirement benefits.

+ References

Reference 1: http://www.xbrl.org/2003/role/exampleRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 715
-SubTopic 20
-Section 55
-Paragraph 17
-URI https://asc.fasb.org/extlink&oid=123450688&loc=d3e4179-114921

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 715
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-Section S99
-Paragraph 2
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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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Reference 5: http://www.xbrl.org/2003/role/disclosureRef
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Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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Reference 8: http://www.xbrl.org/2003/role/disclosureRef
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-URI https://asc.fasb.org/extlink&oid=123447040&loc=d3e1928-114920

+ Details

Audit Information	12 Months Ended
Audit Information	Dec. 31, 2022
Auditor Information [Abstract]
Auditor Firm ID	659
Auditor Name	Moss Adams LLP
Auditor Location	Portland, Oregon

Interest Receivable and Other Assets - Narrative (Details) - USD ($)	Dec. 31, 2022	Dec. 31, 2021
Interest Receivable and Other Assets [Abstract]
Serviced loans with unpaid principal balance	$ 192,880,000	$ 194,649,000

Income Taxes - Provision for Income Taxes from Conversion from an S Corp to a C Corp (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
Income Tax Disclosure [Abstract]
Statutory U.S. federal income tax	$ 13,200	$ 9,901
Benefit of S Corporation status	0	(4,884)
State taxes	5,381	4,045
Deferred tax asset adjustment	0	(4,638)
Other	(524)	283
Provision for income taxes	$ 18,057	$ 4,707

- Definition

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

+ References + Details

Investment Securities (Tables)

12 Months Ended

Dec. 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 December 31, 2022 and 2021 is presented below.


(in thousands)	Amortized Cost		Gross Unrealized				Fair Value
			Gains		(Losses)
2022
Obligations of states and political subdivisions	3,756		—		(324)		3,432
Total held-to-maturity	$	3,756	$	—	$	(324)	$	3,432
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 December 31, 2022 and 2021 is presented below.


(in thousands)	Amortized Cost		Gross Unrealized				Fair Value
			Gains		(Losses)
2022
U.S. government agencies	$	14,317	$	81	$	(225)	$	14,173
Mortgage-backed securities	73,111		1		(11,841)		61,271
Obligations of states and political subdivisions	45,223		21		(6,818)		38,426
Collateralized mortgage obligations	436		—		(41)		395
Corporate bonds	2,000		—		(277)		1,723
Total available-for-sale	$	135,087	$	103	$	(19,202)	$	115,988
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)	2022								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	$	417	$	381	$	501	$	501	$	491	$	516	$	—	$	—
After one but within five years	1,015		927		—		—		951		999		507		522
After five years through ten years	1,470		1,343		5,320		4,761		3,504		3,682		3,697		3,748
After ten years	854		781		39,402		33,164		—		—		40,528		40,867
Investment securities not due at a single maturity date:
U.S. government agencies	—		—		14,317		14,173		—		—		19,824		19,682
Mortgage-backed securities	—		—		73,111		61,271		—		—		82,517		81,513
Collateralized mortgage obligations	—		—		436		395		—		—		537		540
Corporate bonds	—		—		2,000		1,723		—		—		2,000		1,935
Total	$	3,756	$	3,432	$	135,087	$	115,988	$	4,946	$	5,197	$	149,610	$	148,807

Schedule of Realized Gain (Loss)

Sales proceeds of investment securities and gross realized gains and/or losses are shown in the following table:


(in thousands)	2022		2021
Available-for-sale:
Sales proceeds	$	1,623	$	47,096
Gross realized gains	5		724

Schedule of Pledged Investment Securities

Pledged investment securities are shown in the following table:


(in thousands)	2022		2021
Pledged to the State of California:
Securing deposits of public funds and borrowings	$	40,465	$	63,363
Total pledged investment securities	$	40,465	$	63,363

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


(in thousands)	< 12 continuous months				12 continuous months or more				Total securities in a loss position
	Fair Value		Unrealized Loss		Fair Value		Unrealized Loss		Fair Value		Unrealized Loss
2022
U.S. government agencies	$	3,090	$	(125)	$	8,392	$	(100)	$	11,482	$	(225)
Mortgage-backed securities	4,360		(470)		56,908		(11,371)		61,268		(11,841)
Obligations of states and political subdivisions	24,707		(4,097)		11,670		(2,721)		36,377		(6,818)
Collateralized mortgage obligations	395		(41)		—		—		395		(41)
Corporate bonds	—		—		1,723		(277)		1,723		(277)
Total temporarily impaired securities	$	32,552	$	(4,733)	$	78,693	$	(14,469)	$	111,245	$	(19,202)
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)

Bank-owned Life Insurance - Narrative (Details) - USD ($)	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
Investments, All Other Investments [Abstract]
Death benefits	$ 32,931,000
Bank-owned life insurance (“BOLI”)	14,669,000	$ 11,203,000
Earnings on BOLI	$ 412,000	$ 237,000

Investment Securities - Amortized Cost and Fair Value of Investment Debt Securities by Contractual Maturity (Details) - USD ($) $ in Thousands	Dec. 31, 2022	Dec. 31, 2021
Amortized Cost
Within one year	$ 417	$ 491
After one but within five years	1,015	951
After five years through ten years	1,470	3,504
After ten years	854	0
Fair Value
Within one year	381	516
After one but within five years	927	999
After five years through ten years	1,343	3,682
After ten years	781	0
Amortized Cost
Within one year	501	0
After one but within five years	0	507
After five years through ten years	5,320	3,697
After ten years	39,402	40,528
Fair Value
Within one year	501	0
After one but within five years	0	522
After five years through ten years	4,761	3,748
After ten years	33,164	40,867
Securities held-to-maturity	3,756	4,946
Securities held-to-maturity	3,432	5,197
Securities available-for-sale, at amortized cost	135,087	149,610
Securities available-for-sale, at fair value	115,988	148,807
U.S. government agencies
Fair Value
Securities held-to-maturity	0	0
Securities held-to-maturity	0	0
Securities available-for-sale, at amortized cost	14,317	19,824
Securities available-for-sale, at fair value	14,173	19,682
Mortgage-backed securities
Fair Value
Securities held-to-maturity	0	0
Securities held-to-maturity	0	0
Securities available-for-sale, at amortized cost	73,111	82,517
Securities available-for-sale, at fair value	61,271	81,513
Collateralized mortgage obligations
Fair Value
Securities held-to-maturity	0	0
Securities held-to-maturity	0	0
Securities available-for-sale, at amortized cost	436	537
Securities available-for-sale, at fair value	395	540
Corporate bonds
Fair Value
Securities held-to-maturity	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	$ 1,723	$ 1,935

Income Taxes

12 Months Ended

Dec. 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 its 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 an effective state income tax rate and corresponding tax expense.

In conjunction with the termination of the Subchapter S corporation status, the C Corporation deferred tax assets and liabilities were estimated for future tax consequences attributable to differences between the financial statement carrying amounts of the Company’s existing assets and liabilities and their respective tax bases. The deferred tax assets and liabilities were measured using tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of the change in tax rates resulting from becoming a C Corporation was recognized as a $4,638,000 increase to the net deferred tax asset to $5,370,000 and a reduction to the provision for income taxes of $4,638,000 during the year ended December 31, 2021.


(in thousands)	2022		2021
Statutory U.S. federal income tax	$	13,200	$	9,901
Increase (decrease) resulting from:
Benefit of S Corporation status	—		(4,884)
State taxes	5,381		4,045
Deferred tax asset adjustment	—		(4,638)
Other	(524)		283
Provision for income taxes	$	18,057	$	4,707

For the year ended December 31, 2021, the Company’s effective tax rate differed from the statutory California tax rate of 3.50% used prior to May 5, 2021 and the statutory federal and state tax rate, net of federal benefit, of 29.56% used May 5, 2021 and after, as the effective tax rate primarily represents the weighted average rate between the S Corporation tax rate of 3.50% and the C Corporation tax rate of 29.56% based on the number of days the Company was each type of corporation during 2021.

The components of the consolidated provision for income taxes are as follows:


(in thousands)	2022		2021
Current tax expense
Federal	$	13,167	$	6,178
State	6,837		2,530
	20,004		8,708
Deferred tax benefit
Federal	(1,762)		(3,561)
State	(185)		(440)
	(1,947)		(4,001)
Provision for income taxes	$	18,057	$	4,707

Deferred tax assets and liabilities were due to the following as of December 31, 2022 and 2021:


(in thousands)	2022		2021
Deferred tax assets:
Allowance for credit losses	$	9,039	$	7,398
Supplemental employee retirement plan	507		521
Gain on available-for-sale assets	152		151
Net unrealized loss on securities available-for-sale	5,647		237
State tax	1,044		—
Right of use liability	1,351		—
Other	749		562
	18,489		8,869
Deferred tax liabilities:
Deferred loan fees	(4,006)		(2,927)
State tax	—		(379)
Depreciation	(405)		(419)
ROUA	(1,268)		—
Other	(537)		(228)
	(6,216)		(3,953)
Net deferred tax asset	$	12,273	$	4,916

No deferred tax asset valuation allowance was established during 2022 or 2021, as management believes it is more likely than not the Company will realize the benefits of these deductible differences as of December 31, 2022 and 2021.

No unrecognized tax benefits were outstanding as of December 31, 2022 or 2021. The Company files tax returns in the U.S. federal and California state jurisdictions. The Company is no longer subject to examinations for federal and state tax purposes for the years before 2018 and 2017, respectively.

There were no interest or penalties in 2022 and 2021. It is the Company’s policy to record such accruals in its income taxes accounts.

During 2021, the Company paid approximately $26,967,000 to shareholders of record as of May 3, 2021, for the Accumulated Adjustments Account (“AAA”) payout under the Company’s Tax Sharing Agreement. The AAA represents previously taxed, but undistributed, earnings. Upon completion of the 2022 tax return, the Company paid $4,953,000 on March 17, 2022 to shareholders of record as of May 3, 2021, which covered the remaining amount in the AAA account.

- 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.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
-Paragraph 21
-URI https://asc.fasb.org/extlink&oid=121826272&loc=d3e32857-109319

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section S99
-Paragraph 2
-Subparagraph (SAB Topic 11.C)
-URI https://asc.fasb.org/extlink&oid=122134291&loc=d3e330215-122817

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
-Paragraph 17
-Subparagraph (b)
-URI https://asc.fasb.org/extlink&oid=121826272&loc=d3e32809-109319

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SAB TOPIC 6.I.5.Q1)
-URI https://asc.fasb.org/extlink&oid=122134291&loc=d3e330036-122817

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
-Paragraph 14
-URI https://asc.fasb.org/extlink&oid=121826272&loc=d3e32705-109319

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 270
-Section 50
-Paragraph 1
-URI https://asc.fasb.org/extlink&oid=6424409&loc=d3e44925-109338

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-URI https://asc.fasb.org/topic&trid=2144680

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 30
-Section 50
-Paragraph 2
-Subparagraph (a)
-URI https://asc.fasb.org/extlink&oid=6424122&loc=d3e41874-109331

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(h)(2))
-URI https://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690

+ Details

Basis of Presentation - Schedule of Useful Lives (Details)	12 Months Ended
	Dec. 31, 2022
Equipment \| Minimum
Property, Plant and Equipment [Line Items]
Estimated useful life (in years)	3 years
Equipment \| Maximum
Property, Plant and Equipment [Line Items]
Estimated useful life (in years)	12 years
Furniture and fixtures \| Minimum
Property, Plant and Equipment [Line Items]
Estimated useful life (in years)	5 years
Furniture and fixtures \| Maximum
Property, Plant and Equipment [Line Items]
Estimated useful life (in years)	10 years
Leasehold improvements \| Minimum
Property, Plant and Equipment [Line Items]
Estimated useful life (in years)	5 years
Leasehold improvements \| Maximum
Property, Plant and Equipment [Line Items]
Estimated useful life (in years)	15 years
Automobiles \| Minimum
Property, Plant and Equipment [Line Items]
Estimated useful life (in years)	3 years
Automobiles \| Maximum
Property, Plant and Equipment [Line Items]
Estimated useful life (in years)	5 years

Equity Incentive Plan - Narrative (Details) - USD ($)	12 Months Ended
Equity Incentive Plan - Narrative (Details) - USD ($)	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2020
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Maximum number of shares available for grant (in shares)	1,519,826
Stock compensation expense	$ 1,099,000	$ 1,440,000
Restricted Stock
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grants in period (in shares)	23,639	174,347
Unrecognized compensation expense	$ 1,642,000
Number of unvested restricted shares (in shares)	96,826	127,751	11,568
Weighted average remaining term of unvested restricted shares (in years)	3 years 6 months 10 days
Employee
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock compensation expense	$ 652,000	$ 594,000
Employee \| Officer
Retirement Benefits [Abstract]
Share-based compensation, payment award, vesting period (in years)	5 years
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation, payment award, vesting period (in years)	5 years
Director
Retirement Benefits [Abstract]
Share-based compensation, payment award, vesting period (in years)	1 year
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation, payment award, vesting period (in years)	1 year
Stock compensation expense	$ 447,000	$ 846,000
Grants in period (in shares)	15,156	41,640
Minimum \| Employee
Retirement Benefits [Abstract]
Share-based compensation, payment award, vesting period (in years)	3 years
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation, payment award, vesting period (in years)	3 years
Minimum \| Executives and Directors
Retirement Benefits [Abstract]
Share-based compensation, payment award, vesting period (in years)	1 year
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation, payment award, vesting period (in years)	1 year
Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Maximum number of shares available for grant (in shares)	1,700,000
Maximum \| Employee \| Executive Officer
Retirement Benefits [Abstract]
Share-based compensation, payment award, vesting period (in years)	7 years
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation, payment award, vesting period (in years)	7 years
Maximum \| Executives and Directors
Retirement Benefits [Abstract]
Share-based compensation, payment award, vesting period (in years)	3 years
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation, payment award, vesting period (in years)	3 years

Parent Company Only Condensed Financial Information

12 Months Ended

Dec. 31, 2022

Condensed Financial Information Disclosure [Abstract]

Parent Company Only Condensed Financial Information

CONDENSED BALANCE SHEETS

December 31, 2022 and 2021

(In thousands)


	2022		2021
ASSETS
Cash and cash equivalents	$	8,688	$	5,636
Investment in banking subsidiary	316,620		257,456
Other assets	3,090		922
Total assets	$	328,398	$	264,014

LIABILITIES AND SHAREHOLDERS’ EQUITY
Subordinated notes and other liabilities	$	75,573	$	28,968
Shareholders’ equity	252,825		235,046
Total liabilities and shareholders’ equity	$	328,398	$	264,014

CONDENSED STATEMENTS OF INCOME

Years ended December 31, 2022 and 2021

(In thousands)


	2022		2021
Dividends from banking subsidiary	$	16,301	$	27,630
Interest expense	3,740		1,773
Other expense	2,836		3,559
Income before income tax and undistributed banking subsidiary income	9,725		22,298
Income tax benefit	2,094		812
Equity in undistributed banking subsidiary income	32,982		19,331
Net income	$	44,801	$	42,441

CONDENSED STATEMENTS OF CASH FLOWS

Years ended December 31, 2022 and 2021

(In thousands)


	2022		2021
Cash flows from operating activities:
Net income	$	44,801	$	42,441
Adjustments to reconcile net income to net cash provided by operating activities:
Stock compensation expense	652		594
Director stock compensation expense	447		846
Equity in undistributed banking subsidiary income	(32,984)		(19,331)
Amortization of subordinated notes issuance costs	122		66
Extinguishment of redeemed subordinated note issuance costs	302		—
Change in other assets	(2,168)		(631)
Change in accrued expenses and other liabilities	1,385		(405)
Net cash provided by operating activities	12,557		23,580
Cash flows from investing activities:
Investment in subsidiary	(39,000)		(80,800)
Net cash used in investing activities	(39,000)		(80,800)
Cash flows from financing activities:
Proceeds from sale of stock	—		111,243
Cash dividends paid	(15,301)		(51,942)
Proceeds from subordinated note issuance	75,000		—
Subordinated note issuance costs	(1,454)		—
Subordinated note redemption	(28,750)		—
Net cash provided by financing activities	29,495		59,301
Net change in cash and cash equivalents	3,052		2,081
Cash and cash equivalents at beginning of period	5,636		3,555
Cash and cash equivalents at end of period	$	8,688	$	5,636

CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands	Dec. 31, 2022	Dec. 31, 2021
Statement of Financial Position [Abstract]
Fair Value	$ 3,432	$ 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)	17,241,926	17,224,848
Common stock, shares outstanding (in shares)	17,241,926	17,224,848

Interest Bearing Deposits - Interest-Bearing Deposits (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
Interest-bearing Deposits
Interest-bearing transaction accounts	$ 240,131	$ 278,406
Savings accounts	154,581	88,536
Money market accounts	1,073,532	912,558
Time accounts, $250 or more	198,159	77,868
Other time accounts	144,355	26,404
Total interest-bearing deposits	1,810,758	1,383,772
Time accounts	$ 250	$ 250

Investment Securities - Pledged Investment Securities (Details) - USD ($) $ in Thousands	Dec. 31, 2022	Dec. 31, 2021
Marketable Securities [Line Items]
Securities available-for-sale, at fair value	$ 115,988	$ 148,807
Deposits
Marketable Securities [Line Items]
Securities available-for-sale, at fair value	40,465	63,363
CALIFORNIA \| Deposits
Marketable Securities [Line Items]
Securities available-for-sale, at fair value	$ 40,465	$ 63,363

Fair Value of Assets and Liabilities (Tables)

12 Months Ended

Dec. 31, 2022

Fair Value Disclosures [Abstract]

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

The following table summarizes the Company’s assets and liabilities that were carried 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
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	$	115,988	$	—	$	115,988	$	—	OCI
Derivatives – interest rate swap	16		—		16		—		NI
Liabilities:
Derivatives – interest rate swap	16		—		16		—		NI

2021
Assets:
Securities available-for-sale:
U.S. government agencies, mortgage-backed securities, obligations of states and political subdivisions, and collateralized mortgage obligations	$	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

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.


(in thousands)	December 31, 2022					December 31, 2021
	Carrying Amounts		Fair Value		Fair Value Hierarchy	Carrying Amounts		Fair Value		Fair Value Hierarchy
Financial assets:
Cash and cash equivalents	$	259,991	$	259,991	Level 1	$	425,329	$	425,329	Level 1
Time deposits in banks	9,849		9,849		Level 1	14,464		14,464		Level 1
Securities available-for-sale	115,988		115,988		Level 2	148,807		148,807		Level 2
Securities held-to-maturity	3,756		3,432		Level 3	4,946		5,197		Level 3
Loans held for sale	9,416		9,785		Level 2	10,671		11,217		Level 2
Loans held for investment, net of allowance for loan losses	2,762,937		2,570,176		Level 3	1,911,217		1,893,431		Level 3
FHLB stock and other investments	16,570		N/A		N/A	12,464		N/A		N/A
Interest receivable	7,454		7,454		Level 2	5,332		5,332		Level 2
Interest rate swap	16		16		Level 2	92		92		Level 2
Financial liabilities:
Deposits	2,782,004		2,562,600		Level 2	2,285,890		2,210,555		Level 2
Interest payable	1,568		1,568		Level 2	23		23		Level 2
Interest rate swap	16		16		Level 2	92		92		Level 2
Subordinated notes	73,606		72,273		Level 3	28,386		28,386		Level 3

Investment Securities - Narrative (Details)	12 Months Ended
Investment Securities - Narrative (Details)	Dec. 31, 2022 USD ($) security $ / shares	Dec. 31, 2021 USD ($) security
Marketable Securities [Line Items]
Number of securities in unrealized loss positions	152	91
Number of investment securities in a continuous loss position for twelve months or more	62
Investment securities in a loss position for less than twelve months	90
Held-to-maturity securities in a continuous loss position for twelve months or less	1
Held-to-maturity securities in a continuous loss position for more than 12 months	0
FHLB stock price (in USD per share) \| $ / shares	$ 100
FHLB Stock \| $	$ 10,890,000	$ 6,723,000
FHLB stock dividends \| $	546,000	372,000
Investment in Federal Home Loan Bank Stock
Marketable Securities [Line Items]
FHLB stock dividends \| $	$ 546,000	$ 372,000