What changed in First Guaranty Bancshares, Inc.'s 10-K — 2022 vs 2023
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Paragraph-level year-over-year comparison of First Guaranty Bancshares, Inc.'s 2022 and 2023 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2023 report.
+500 added−539 removedSource: 10-K (2024-03-15) vs 10-K (2023-03-16)
Top changes in First Guaranty Bancshares, Inc.'s 2023 10-K
500 paragraphs added · 539 removed · 396 edited across 1 sections
- Item 1A. Risk Factors+500 / −539 · 396 edited
Item 1A. Risk Factors
Risk Factors — what could go wrong, per management
396 edited+104 added−143 removed413 unchanged
Item 1A. Risk Factors
Risk Factors — what could go wrong, per management
396 edited+104 added−143 removed413 unchanged
2022 filing
2023 filing
Biggest changeSee the tables below for more detail on nonaccrual loans. -89- The following is a summary of nonaccrual loans by class at the dates indicated: As of December 31, (in thousands) 2022 2021 Real Estate: Construction & land development $ 225 $ 530 Farmland 290 787 1- 4 family 3,826 2,861 Multifamily — — Non-farm non-residential 3,746 8,733 Total Real Estate 8,087 12,911 Non-Real Estate: Agricultural 1,622 2,302 Commercial and industrial 819 699 Commercial leases 1,799 — Consumer and other 1,239 803 Total Non-Real Estate 5,479 3,804 Total Nonaccrual Loans $ 13,566 $ 16,715 The following table identifies the credit exposure of the loan portfolio, including loans acquired with deteriorated credit quality, by specific credit ratings as of the dates indicated: As of December 31, 2022 As of December 31, 2021 (in thousands) Pass Special Mention Substandard Doubtful Total Pass Special Mention Substandard Doubtful Total Real Estate: Construction & land development $ 229,416 $ 2,846 $ 829 $ — $ 233,091 $ 151,220 $ 21,997 $ 1,117 $ — $ 174,334 Farmland 19,722 35 5,066 — 24,823 27,678 40 4,092 — 31,810 1- 4 family 347,842 8,667 9,821 — 366,330 270,866 7,644 9,837 — 288,347 Multifamily 117,081 444 2,260 — 119,785 56,686 2,212 6,950 — 65,848 Non-farm non-residential 968,861 15,071 8,997 — 992,929 795,495 72,103 18,809 — 886,407 Total Real Estate 1,682,922 27,063 26,973 — 1,736,958 1,301,945 103,996 40,805 — 1,446,746 Non-Real Estate: Agricultural 34,827 198 4,020 — 39,045 23,952 128 2,667 — 26,747 Commercial and industrial 374,947 2,016 8,316 — 385,279 355,407 34,220 8,764 — 398,391 Commercial leases 315,775 — 1,799 — 317,574 245,869 — 153 — 246,022 Consumer and other 45,225 1,031 1,608 — 47,864 46,804 374 964 — 48,142 Total Non-Real Estate 770,774 3,245 15,743 — 789,762 672,032 34,722 12,548 — 719,302 Total Loans Before Unearned Income $ 2,453,696 $ 30,308 $ 42,716 $ — 2,526,720 $ 1,973,977 $ 138,718 $ 53,353 $ — 2,166,048 Unearned income (7,643) (6,689) Total Loans Net of Unearned Income $ 2,519,077 $ 2,159,359 -90- Purchased Impaired Loans As part of the acquisition of Union Bancshares, Inc. on November 7, 2019 and Premier Bancshares, Inc. on June 16, 2017, First Guaranty purchased credit impaired loans for which there was, at acquisition, evidence of deterioration of credit quality since their origination and it was probable, at acquisition, that all contractually required payments would not be collected.
Biggest changeSee the tables below for more detail on nonaccrual loans. -87- The following is a summary of nonaccrual loans by class at the dates indicated: As of December 31, 2023 (in thousands) With Related Allowance Without Related Allowance Total Real Estate: Construction & land development $ 530 $ — $ 530 Farmland 511 325 836 1 - 4 family 5,417 1,568 6,985 Multifamily — 537 537 Non-farm non-residential 8,730 1,010 9,740 Total Real Estate 15,188 3,440 18,628 Non-Real Estate: Agricultural 399 970 1,369 Commercial and industrial 1,581 — 1,581 Commercial leases — 1,799 1,799 Consumer and other 1,810 — 1,810 Total Non-Real Estate 3,790 2,769 6,559 Total Nonaccrual Loans $ 18,978 $ 6,209 $ 25,187 (in thousands) As of December 31, 2022 Real Estate: Construction & land development $ 225 Farmland 290 1- 4 family 3,826 Multifamily — Non-farm non-residential 3,746 Total Real Estate 8,087 Non-Real Estate: Agricultural 1,622 Commercial and industrial 819 Commercial leases 1,799 Consumer and other 1,239 Total Non-Real Estate 5,479 Total Nonaccrual Loans $ 13,566 -88- The following table presents First Guaranty's loan portfolio by credit quality classification and origination year as of the date indicated: As of December 31, 2023 Term Loans by Origination Year (in thousands) 2023 2022 2021 2020 2019 Prior Revolving Loans Total Real Estate: Construction & land development: Pass $ 134,527 $ 140,068 $ 75,884 $ 3,369 $ 8,533 11,940 $ 18,907 $ 393,228 Special Mention 789 1,579 170 — 90 250 — 2,878 Substandard — 716 458 263 94 1,668 — 3,199 Doubtful — 39 91 — — — — 130 Total Construction & land development 135,316 142,402 76,603 3,632 8,717 13,858 18,907 399,435 Current period gross charge-offs — — — — — — — — Farmland Pass 9,513 4,032 3,340 1,768 253 2,730 2,162 23,798 Special Mention — 194 — 514 — 359 — 1,067 Substandard — 251 1,369 3,877 115 653 1,355 7,620 Doubtful — — — — — — 45 45 Total Farmland 9,513 4,477 4,709 6,159 368 3,742 3,562 32,530 Current period gross charge-offs — — — — — — — — 1- 4 family Pass 112,636 110,978 70,599 41,766 19,542 47,374 17,215 420,110 Special Mention 1,307 2,505 749 1,544 775 997 667 8,544 Substandard 48 2,625 5,368 1,357 1,956 3,086 773 15,213 Doubtful — 122 391 — 239 159 72 983 Total 1- 4 family 113,991 116,230 77,107 44,667 22,512 51,616 18,727 444,850 Current period gross charge-offs — — — — — 964 — 964 Multifamily Pass 9,945 76,217 6,121 15,131 1,877 2,311 5,110 116,712 Special Mention — — — — — 1,648 24 1,672 Substandard — — — — — 537 — 537 Doubtful — — — — — — — — Total Multifamily 9,945 76,217 6,121 15,131 1,877 4,496 5,134 118,921 Current period gross charge-offs — — — — — — — — Non-farm non-residential Pass 162,234 247,182 111,054 88,039 73,797 256,032 33,907 972,245 Special Mention 708 369 1,014 388 15,846 5,191 1,525 25,041 Substandard 247 18,930 18,488 — — 6,125 4,723 48,513 Doubtful — — — 66 — — — 66 Total non-farm non-residential 163,189 266,481 130,556 88,493 89,643 267,348 40,155 1,045,865 Current period gross charge-offs — — — 138 — — — 138 Total Real Estate 431,954 605,807 295,096 158,082 123,117 341,060 86,485 2,041,601 Non-Real Estate: Agricultural Pass 2,555 10,406 3,142 1,336 1,532 2,378 16,259 37,608 Special Mention — 104 — 81 — — 25 210 Substandard — — 692 279 20 2,100 57 3,148 Doubtful — — — — — 42 — 42 Total Agricultural 2,555 10,510 3,834 1,696 1,552 4,520 16,341 41,008 Current period gross charge-offs — — — — — — — — Commercial and industrial Pass 41,105 27,800 48,097 53,585 5,613 27,634 119,886 323,720 -89- Special Mention 63 37 4,382 146 — 53 598 5,279 Substandard 45 283 178 602 27 4,531 145 5,811 Doubtful — — — — — 162 — 162 Total Commercial and industrial 41,213 28,120 52,657 54,333 5,640 32,380 120,629 334,972 Current period gross charge-offs 29 791 133 532 — 209 — 1,694 Commercial leases Pass 74,456 117,566 67,615 6,087 4,428 — — 270,152 Special Mention — 11,867 1,597 — — — — 13,464 Substandard — 1,799 — — — — — 1,799 Doubtful — — — — — — — — Total Commercial leases 74,456 131,232 69,212 6,087 4,428 — — 285,415 Current period gross charge-offs — — — — — — — — Consumer and other loans Pass 21,257 8,770 6,463 6,164 650 7,887 150 51,341 Special Mention 36 151 255 87 15 19 — 563 Substandard 164 1,077 790 265 86 68 — 2,450 Doubtful — — 34 79 2 16 — 131 Total Consumer and other loans 21,457 9,998 7,542 6,595 753 7,990 150 54,485 Current period gross charge-offs 598 1,126 820 359 28 44 — 2,975 Total Non-Real Estate 139,681 179,860 133,245 68,711 12,373 44,890 137,120 715,880 Total Loans Pass 568,228 743,019 392,315 217,245 116,225 358,286 213,596 2,608,914 Special Mention 2,903 16,806 8,167 2,760 16,726 8,517 2,839 58,718 Substandard 504 25,681 27,343 6,643 2,298 18,768 7,053 88,290 Doubtful — 161 516 145 241 379 117 1,559 Total Loans Before Unearned Income $ 571,635 $ 785,667 $ 428,341 $ 226,793 $ 135,490 $ 385,950 $ 223,605 $ 2,757,481 Unearned income (8,773) Total Loans Net of Unearned Income $ 2,748,708 Total Current Period Gross Charge-offs $ 627 $ 1,917 $ 953 $ 1,029 $ 28 $ 1,217 $ — $ 5,771 -90- The following table identifies the credit exposure of the loan portfolio, including loans acquired with deteriorated credit quality, by specific credit ratings as of the date indicated: As of December 31, 2022 (in thousands) Pass Special Mention Substandard Doubtful Total Real Estate: Construction & land development $ 229,416 $ 2,846 $ 829 $ — $ 233,091 Farmland 19,722 35 5,066 — 24,823 1- 4 family 347,842 8,667 9,821 — 366,330 Multifamily 117,081 444 2,260 — 119,785 Non-farm non-residential 968,861 15,071 8,997 — 992,929 Total Real Estate 1,682,922 27,063 26,973 — 1,736,958 Non-Real Estate: Agricultural 34,827 198 4,020 — 39,045 Commercial and industrial 374,947 2,016 8,316 — 385,279 Commercial leases 315,775 — 1,799 — 317,574 Consumer and other 45,225 1,031 1,608 — 47,864 Total Non-Real Estate 770,774 3,245 15,743 — 789,762 Total Loans Before Unearned Income $ 2,453,696 $ 30,308 $ 42,716 $ — 2,526,720 Unearned income (7,643) Total Loans Net of Unearned Income $ 2,519,077 Purchased Credit Deteriorated Loans As part of the acquisition of Union Bancshares, Inc. on November 7, 2019 and Premier Bancshares, Inc. on June 16, 2017, First Guaranty purchased credit impaired loans for which there was, at acquisition, evidence of deterioration of credit quality since their origination and it was probable, at acquisition, that all contractually required payments would not be collected.
Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. Since commitments may expire without being drawn upon, the total commitment amounts do not necessarily represent future cash requirements. Each customer's creditworthiness is evaluated on a case-by-case basis.
Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. Since commitments may expire without being drawn upon, the total commitment amounts do not necessarily represent future cash requirements. Each customer's creditworthiness is evaluated on a case-by-case basis.
A fair value measurement assumes that the transaction to sell the asset or transfer the liability occurs in the principal market for the asset or liability or, in the absence of a principal market, the most advantageous market for the asset or liability. Valuation techniques use certain inputs to arrive at fair value.
A fair value measurement assumes that the transaction to sell the asset or transfer the liability occurs in the principal market for the asset or liability or, in the absence of a principal market, the most advantageous market for the asset or liability. Valuation techniques use certain inputs to arrive at fair value.
Inputs to valuation techniques are the assumptions that market participants would use in pricing the asset or liability. They may be observable or unobservable. First Guaranty uses a fair value hierarchy for valuation inputs that gives the highest priority to quoted prices in active markets for identical assets or liabilities and the lowest priority to unobservable inputs.
Inputs to valuation techniques are the assumptions that market participants would use in pricing the asset or liability. They may be observable or unobservable. First Guaranty uses a fair value hierarchy for valuation inputs that gives the highest priority to quoted prices in active markets for identical assets or liabilities and the lowest priority to unobservable inputs.
Where it is probable that First Guaranty will incur a loss and the amount of the loss can be reasonably estimated, First Guaranty records a liability in its consolidated financial statements. First Guaranty does not record a loss if the loss is not probable or the amount of the loss is not estimable.
Where it is probable that First Guaranty will incur a loss and the amount of the loss can be reasonably estimated, First Guaranty records a liability in its consolidated financial statements. First Guaranty does not record a loss if the loss is not probable or the amount of the loss is not estimable.
In the opinion of management, neither First Guaranty nor First Guaranty Bank is currently involved in such legal proceedings, either individually or in the aggregate, that the resolution is expected to have a material adverse effect on First Guaranty’s consolidated results of operations, financial condition, or cash flows.
In the opinion of management, neither First Guaranty nor First Guaranty Bank is currently involved in such legal proceedings, either individually or in the aggregate, that the resolution is expected to have a material adverse effect on First Guaranty’s consolidated results of operations, financial condition, or cash flows.
However, one or more unfavorable outcomes in these ordinary claims or litigation against First Guaranty or First Guaranty Bank could have a material adverse effect for the period in which they are resolved.
However, one or more unfavorable outcomes in these ordinary claims or litigation against First Guaranty or First Guaranty Bank could have a material adverse effect for the period in which they are resolved.
(2) Incorporated by reference to Exhibit 3.1 of the Current Report on Form 8-K filed by First Guaranty Bancshares, Inc. with the Securities and Exchange Commission on September 23, 2011. (3) Incorporated by reference to Exhibit 3.2 of the Current Report on Form 8-K12G3 filed by First Guaranty Bancshares, Inc. with the Securities and Exchange Commission on August 2, 2007.
(1) Incorporated by reference to Exhibit 3.1 of the Current Report on Form 8-K12G3 filed by First Guaranty Bancshares, Inc. with the Securities and Exchange Commission on August 2, 2007. (2) Incorporated by reference to Exhibit 3.1 of the Current Report on Form 8-K filed by First Guaranty Bancshares, Inc. with the Securities and Exchange Commission on September 23, 2011.
Consideration is given to (i) the length of time and the extent to which the fair value has been less than cost, (ii) the financial condition and near-term prospects of the issuer, (iii) the recovery of contractual principal and interest and (iv) the intent and ability of First Guaranty to retain its investment in the issuer for a period of time sufficient to allow for any anticipated recovery in fair value.
Consideration is given to (i) the extent to which the fair value has been less than cost, (ii) the financial condition and near-term prospects of the issuer, (iii) the recovery of contractual principal and interest and (iv) the intent and ability of First Guaranty to retain its investment in the issuer for a period of time sufficient to allow for any anticipated recovery in fair value.
Recent supplements to this guidance reiterate the need for bank holding companies to inform their applicable reserve bank sufficiently in advance of the proposed payment of a dividend in certain circumstances. The Series A Preferred Stock constitutes an equity security and ranks junior to all of our indebtedness and will rank junior to our and First Guaranty Bank’s future indebtedness.
Recent supplements to this guidance reiterate the need for bank holding companies to inform their applicable reserve bank sufficiently in advance of the proposed payment of a dividend in certain circumstances. -32- The Series A Preferred Stock constitutes an equity security and ranks junior to all of our indebtedness and will rank junior to our and First Guaranty Bank’s future indebtedness.
The differences in resources may make it harder for us to compete profitably, reduce the rates that we can earn on loans and investments, increase the rates we must offer on deposits and other funds, and adversely affect our overall financial condition and earnings. Risks Related to Operations We face risks related to our operational, technological and organizational infrastructure.
The differences in resources may make it harder for us to compete profitably, reduce the rates that we can earn on loans and investments, increase the rates we must offer on deposits and other funds, and adversely affect our overall financial condition and earnings. -27- Risks Related to Operations We face risks related to our operational, technological and organizational infrastructure.
However, other operating expenses do reflect general levels of inflation. The Federal Reserve increased interest rates during 2022 to address rising inflation in the U.S. The impact of rising interest rates associated with inflation impacted First Guaranty's net interest income and net interest margin along with the value of its financial assets.
However, other operating expenses do reflect general levels of inflation. The Federal Reserve increased interest rates during 2022 and 2023 to address rising inflation in the U.S. The impact of rising interest rates associated with inflation impacted First Guaranty's net interest income and net interest margin along with the value of its financial assets.
For debt securities that do not meet the aforementioned criteria, the amount of impairment is split into two components as follows: 1) OTTI related to credit loss, which must be recognized in the income statement and 2) OTTI related to other factors, which is recognized in other comprehensive income.
For debt securities that do not meet the aforementioned criteria, the amount of impairment is split into two components as follows: 1) impairment related to credit loss, which must be recognized in the income statement and 2) impairment related to other factors, which is recognized in other comprehensive income.
(23) Incorporated by reference to Exhibit 14.4 of the Annual Report on Form 10-K for the year ended December 31, 2021 filed by First Guaranty Bancshares, Inc. with the Securities and Exchange Commission on March 16, 2022.
(14) Incorporated by reference to Exhibit 14.4 of the Annual Report on Form 10-K for the year ended December 31, 2021 filed by First Guaranty Bancshares, Inc. with the Securities and Exchange Commission on March 16, 2022.
The short-term borrowings at December 31, 2022 were comprised of short-term Federal Home Loan Bank advances of $120.0 million, a line of credit of $20.0 million with an outstanding balance of $20.0 million and repurchase agreements of $6.4 million. The short-term borrowings outstanding at December 31, 2021 were comprised of repurchase agreements of $6.4 million.
The short-term borrowings outstanding at December 31, 2022 were comprised of $120.0 million of short-term Federal Home Loan Bank advances of $120.0 million, a line of credit of $20.0 million with an outstanding balance of $20.0 million and repurchase agreements of $6.4 million.
In addition, regardless of their merits or ultimate outcomes, such matters are costly, divert management’s attention, and may materially and adversely affect the reputation of First Guaranty and First Guaranty Bank, even if resolved favorably. Note 23.
In addition, regardless of their merits or ultimate outcomes, such matters are costly, divert management’s attention, and may materially and adversely affect the reputation of First Guaranty and First Guaranty Bank, even if resolved favorably. -108- Note 23.
Management's Discussion and Analysis of Financial Condition and Results of Operations" in our Annual Report on Form 10-K for the year ended December 31, 2021, filed with the SEC on March 16, 2022, which is available on the SEC's website at www.sec.gov and First Guaranty's website, www.fgb.net This discussion and analysis contains forward-looking statements that are subject to certain risks and uncertainties and are based on certain assumptions that we believe are reasonable but may prove to be inaccurate.
Management's Discussion and Analysis of Financial Condition and Results of Operations" in our Annual Report on Form 10-K for the year ended December 31, 2022, filed with the SEC on March 16, 2023, which is available on the SEC's website at www.sec.gov and First Guaranty's website, www.fgb.net This discussion and analysis contains forward-looking statements that are subject to certain risks and uncertainties and are based on certain assumptions that we believe are reasonable but may prove to be inaccurate.
(17). 3.4 Bylaws of First Guaranty Bancshares, Inc.(3) 3.5 Amendment to Bylaws of First Guaranty Bancshares, Inc.(4) 4.1 Form of Common Stock Certificate of First Guaranty Bancshares, Inc.(5) 4.2 Subordinated Note, dated as of June 21, 2022 , by and between First Guaranty Bancshares, Inc. and Edgar Ray Smith, III.
(1 1 ). 3.4 Bylaws of First Guaranty Bancshares, Inc.(3) 3.5 Amendment to Bylaws of First Guaranty Bancshares, Inc.(4) 4.1 Form of Common Stock Certificate of First Guaranty Bancshares, Inc.(5) 4.2 Subordinated Note, dated as of June 21, 2022, by and between First Guaranty Bancshares, Inc. and Edgar Ray Smith, III.
(4) Incorporated by reference to Exhibit 3.3 of the Current Report on Form 8-K12G3 filed by First Guaranty Bancshares, Inc. with the Securities and Exchange Commission on August 2, 2007. (5) Incorporated by reference to Exhibit 4 of the Current Report on Form 8-K12G3 filed by First Guaranty Bancshares, Inc. with the Securities and Exchange Commission on August 2, 2007.
(4) Incorporated by reference to Exhibit 3.3 of the Current Report on Form 8-K12G3 filed by First Guaranty Bancshares, Inc. with the Securities and Exchange Commission on August 2, 2007. -114- (5) Incorporated by reference to Exhibit 4 of the Current Report on Form 8-K12G3 filed by First Guaranty Bancshares, Inc. with the Securities and Exchange Commission on August 2, 2007.
The carryforwards were acquired in 2017 in the Premier acquisition and expire from 2027 to 2034, and will be utilized subject to annual Internal Revenue Code Section 382 limitations. -104- ASC 740-10, Income Taxes, clarifies the accounting for uncertainty in income taxes and prescribes a recognition threshold and measurement attribute for the consolidated financial statements recognition and measurement of a tax position taken or expected to be taken in a tax return.
The carryforwards were acquired in 2017 in the Premier acquisition and expire from 2027 to 2034, and will be utilized subject to annual Internal Revenue Code Section 382 limitations. -101- ASC 740-10, Income Taxes, clarifies the accounting for uncertainty in income taxes and prescribes a recognition threshold and measurement attribute for the consolidated financial statements recognition and measurement of a tax position taken or expected to be taken in a tax return.
The initial fixed rate periods are typically one, three, or five year periods. -45- Non-performing Assets Non-performing assets consist of non-performing loans and other real-estate owned. Non-performing loans (including nonaccruing troubled debt restructurings described below) are those on which the accrual of interest has stopped or loans which are contractually 90 days past due on which interest continues to accrue.
The initial fixed rate periods are typically one, three, or five year periods. -44- Non-performing Assets Non-performing assets consist of non-performing loans and other real-estate owned. Non-performing loans (including nonaccruing troubled debt restructurings described below) are those on which the accrual of interest has stopped or loans which are contractually 90 days past due on which interest continues to accrue.
Prepayments of mortgages that collateralize mortgage-backed securities also affect the maturity of the securities portfolio. -55- Deposits Managing the mix and pricing the maturities of deposit liabilities is an important factor affecting our ability to maximize our net interest margin. The strategies used to manage interest-bearing deposit liabilities are designed to adjust as the interest rate environment changes.
Prepayments of mortgages that collateralize mortgage-backed securities also affect the maturity of the securities portfolio. -53- Deposits Managing the mix and pricing the maturities of deposit liabilities is an important factor affecting our ability to maximize our net interest margin. The strategies used to manage interest-bearing deposit liabilities are designed to adjust as the interest rate environment changes.
Nonfinancial reasons include management problems, pending litigation, an ineffective loan agreement or other material structural weakness, and any other significant deviation from prudent lending practices. -80- A substandard loan is inadequately protected by the paying capacity of the obligor or of the collateral pledged, if any. Loans classified as substandard have a well-defined weakness.
Nonfinancial reasons include management problems, pending litigation, an ineffective loan agreement or other material structural weakness, and any other significant deviation from prudent lending practices. -77- A substandard loan is inadequately protected by the paying capacity of the obligor or of the collateral pledged, if any. Loans classified as substandard have a well-defined weakness.
As of December 31, 2022, the most recent notification from the Federal Deposit Insurance Corporation categorized the Bank 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 following table.
As of December 31, 2023, the most recent notification from the Federal Deposit Insurance Corporation categorized the Bank 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 following table.
First Guaranty recognizes interest and penalties accrued related to unrecognized tax benefits, if applicable, in noninterest expense. During the years ended December 31, 2022 and 2021, First Guaranty did not recognize any interest or penalties in its consolidated financial statements, nor has it recorded an accrued liability for interest or penalty payments. Note 18.
First Guaranty recognizes interest and penalties accrued related to unrecognized tax benefits, if applicable, in noninterest expense. During the years ended December 31, 2023 and 2022, First Guaranty did not recognize any interest or penalties in its consolidated financial statements, nor has it recorded an accrued liability for interest or penalty payments. Note 18.
With few exceptions, First Guaranty is no longer subject to U.S. federal, state or local income tax examinations for years before 2018. Deferred tax assets and liabilities are 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.
With few exceptions, First Guaranty is no longer subject to U.S. federal, state or local income tax examinations for years before 2019. Deferred tax assets and liabilities are 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.
The following table summarizes fixed and floating rate loans by contractual maturity, excluding nonaccrual loans, as of December 31, 2022 and December 31, 2021 unadjusted for scheduled principal payments, prepayments, or repricing opportunities. The average life of the loan portfolio may be substantially less than the contractual terms when these adjustments are considered.
The following table summarizes fixed and floating rate loans by contractual maturity, excluding nonaccrual loans, as of December 31, 2023 and December 31, 2022 unadjusted for scheduled principal payments, prepayments, or repricing opportunities. The average life of the loan portfolio may be substantially less than the contractual terms when these adjustments are considered.
During the years ended 2022 and 2021, First Guaranty paid approximately $0.3 million, respectively, for printing services and supplies and office furniture and equipment to Champion Industries, Inc., of which Mr. Marshall T. Reynolds, the Chairman of First Guaranty's Board of Directors, is President, Chief Executive Officer, Chairman of the Board of Directors and a major shareholder of Champion.
During the years ended 2023 and 2022, First Guaranty paid approximately $0.3 million, respectively, for printing services and supplies and office furniture and equipment to Champion Industries, Inc., of which Mr. Marshall T. Reynolds, the Chairman of First Guaranty's Board of Directors, is President, Chief Executive Officer, Chairman of the Board of Directors and a major shareholder of Champion.
These strategies include, but are not limited to, frequent internal modeling of asset and liability values and behavior due to changes in interest rates. We monitor cash flow forecasts closely and evaluate the impact of both prepayments and extension risk. -69- The following interest sensitivity analysis is one measurement of interest rate risk.
These strategies include, but are not limited to, frequent internal modeling of asset and liability values and behavior due to changes in interest rates. We monitor cash flow forecasts closely and evaluate the impact of both prepayments and extension risk. -66- The following interest sensitivity analysis is one measurement of interest rate risk.
Such financial instruments are recorded when they are funded. -82- Income taxes First Guaranty and its subsidiary file a consolidated federal income tax return on a calendar year basis. In lieu of Louisiana state income tax, the Bank is subject to the Louisiana bank shares tax, which is included in noninterest expense in First Guaranty's consolidated financial statements.
Such financial instruments are recorded when they are funded. -79- Income taxes First Guaranty and its subsidiary file a consolidated federal income tax return on a calendar year basis. In lieu of Louisiana state income tax, the Bank is subject to the Louisiana bank shares tax, which is included in noninterest expense in First Guaranty's consolidated financial statements.
There was no change in First Guaranty's internal control over financial reporting (as defined in Rule 13a-15(f) under the Securities Exchange Act of 1934) that occurred during the quarter ended December 31, 2022, that has materially affected, or is reasonably likely to materially affect, First Guaranty's internal control over financial reporting.
There was no change in First Guaranty's internal control over financial reporting (as defined in Rule 13a-15(f) under the Securities Exchange Act of 1934) that occurred during the quarter ended December 31, 2023, that has materially affected, or is reasonably likely to materially affect, First Guaranty's internal control over financial reporting.
These factors include but are not limited to: • past due and non-performing assets; • specific internal analysis of loans requiring special attention; • the current level of regulatory classified and criticized assets and the associated risk factors with each; • changes in underwriting standards or lending procedures and policies; • charge-off and recovery practices; • national and local economic and business conditions including the COVID-19 pandemic; • nature and volume of loans; • overall portfolio quality, loan concentrations and portfolio stress test results; • adequacy of loan collateral; • quality of loan review system and degree of oversight by our board of directors; • competition and legal and regulatory requirements on borrowers; • examinations of the loan portfolio by federal and state regulatory agencies and examinations; and • review by our internal loan review department and independent accountants.
These factors include but are not limited to: • past due and non-performing assets; • specific internal analysis of loans requiring special attention; • the current level of regulatory classified and criticized assets and the associated risk factors with each; • changes in underwriting standards or lending procedures and policies; • charge-off and recovery practices; • national and local economic and business conditions; • nature and volume of loans; • overall portfolio quality, loan concentrations and portfolio stress test results; • adequacy of loan collateral; • quality of loan review system and degree of oversight by our board of directors; • competition and legal and regulatory requirements on borrowers; • examinations of the loan portfolio by federal and state regulatory agencies and examinations; and • review by our internal loan review department and independent accountants.
The fair values of letters of credit are based on fees charged for similar agreements or on estimated cost to terminate them or otherwise settle the obligations with the counterparties at the reporting date. At December 31, 2022 and 2021 the fair value of guarantees under commercial and standby letters of credit was not material.
The fair values of letters of credit are based on fees charged for similar agreements or on estimated cost to terminate them or otherwise settle the obligations with the counterparties at the reporting date. At December 31, 2023 and 2022 the fair value of guarantees under commercial and standby letters of credit was not material.
Item 16 - Form 10-K Summary None. -118- SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, First Guaranty has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. FIRST GUARANTY BANCSHARES, INC.
Item 16 - Form 10-K Summary None. -115- SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, First Guaranty has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. FIRST GUARANTY BANCSHARES, INC.
Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended December 31, 2021, filed with the SEC on March 16, 2022, which is available on the SEC’s website at www.sec.gov and on our website, www.fgb.net.
Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended December 31, 2022, filed with the SEC on March 16, 2023, which is available on the SEC’s website at www.sec.gov and on our website, www.fgb.net.
Handley Ederville Road Fort Worth, TX 76118 Fort Worth Banking Center 2017 Owned 603 Main Street #101 Garland, TX 75040 Garland Banking Center 2017 Leased 4221 Airline Drive Bossier City, LA 71111 Bossier City Banking Center 2017 Owned 4740 Nelson Rd #320 Lake Charles, LA 70605 Lake Charles Loan Production Office 2019 Leased 632 West Oak Street Amite, LA 70422 Amite Banking Center 2019 Owned 1701 Metro Drive Alexandria, LA 71301 Alexandria Banking Center 2019 Owned -36- 1110 Shirley Road Bunkie, LA 71322 Bunkie Banking Center 2019 Owned 2705 Main Street Hessmer, LA 71341 Hessmer Banking Center 2019 Owned 305 North Main Street Marksville, LA 71351 Marksville Banking Center 2019 Owned 211 East Tunica Drive Marksville, LA 71351 Tunica Banking Center 2019 Owned 10710 Highway 1 Moreauville, LA 71355 Moreauville Banking Center 2019 Owned 40 Pinecrest Drive Pineville, LA 71360 Pineville Banking Center 2019 Owned 15 Second Street Vanceburg, Kentucky 41179 Vanceburg Banking Center 2021 Owned 173 Bombarder Way, Jct.
Handley Ederville Road Fort Worth, TX 76118 Fort Worth Banking Center 2017 Owned 603 Main Street #101 Garland, TX 75040 Garland Banking Center 2017 Leased 4221 Airline Drive Bossier City, LA 71111 Bossier City Banking Center 2017 Owned 4740 Nelson Rd #320 Lake Charles, LA 70605 Lake Charles Loan Production Office 2019 Leased 632 West Oak Street Amite, LA 70422 Amite Banking Center 2019 Owned 1701 Metro Drive Alexandria, LA 71301 Alexandria Banking Center 2019 Owned -35- 1110 Shirley Road Bunkie, LA 71322 Bunkie Banking Center 2019 Owned 2705 Main Street Hessmer, LA 71341 Hessmer Banking Center 2019 Owned 305 North Main Street Marksville, LA 71351 Marksville Banking Center 2019 Owned 211 East Tunica Drive Marksville, LA 71351 Tunica Banking Center 2019 Owned 10710 Highway 1 Moreauville, LA 71355 Moreauville Banking Center 2019 Owned 40 Pinecrest Drive Pineville, LA 71360 Pineville Banking Center 2019 Owned 15 Second Street Vanceburg, Kentucky 41179 Vanceburg Banking Center 2021 Owned 173 Bombardier Way, Jct.
If quoted market prices are unavailable, fair value is estimated using quoted prices of securities with similar characteristics, at which point the securities would be classified within Level 2 of the hierarchy. Securities classified Level 3 as of December 31, 2022 includes corporate debt and municipal securities. Impaired loans .
If quoted market prices are unavailable, fair value is estimated using quoted prices of securities with similar characteristics, at which point the securities would be classified within Level 2 of the hierarchy. Securities classified Level 3 as of December 31, 2023 includes corporate debt and municipal securities. Impaired loans .
Routes 50 and 76 Bridgeport, West Virginia 26330 Bridgeport Loan and Deposit Production Office 2021 Leased -37- Item 3 - Legal Proceedings First Guaranty is subject to various legal proceedings in the normal course of its business. First Guaranty assesses its liabilities and contingencies in connection with outstanding legal proceedings.
Routes 50 and 76 Bridgeport, West Virginia 26330 Bridgeport Loan and Deposit Production Office 2021 Leased -36- Item 3 - Legal Proceedings First Guaranty is subject to various legal proceedings in the normal course of its business. First Guaranty assesses its liabilities and contingencies in connection with outstanding legal proceedings.
All loans, except mortgage loans, are considered past due if they are past due 30 days. Mortgage loans are considered past due when two consecutive payments have been missed. Loans that are past due 90-120 days and deemed uncollectible are charged-off. The loan charge off is a reduction of the allowance for loan and lease losses.
All loans, except mortgage loans, are considered past due if they are past due 30 days. Mortgage loans are considered past due when two consecutive payments have been missed. Loans that are past due 90-120 days and deemed uncollectible are charged-off. The loan charge off is a reduction of the allowance for credit losses.
Over the last 15 years, we have pursued a focused program to participate in select syndicated loans (loans made by a group of lenders, including us, who share or participate in a specific loan) with a larger regional financial institution as the lead lender.
Over the last 16 years, we have pursued a focused program to participate in select syndicated loans (loans made by a group of lenders, including us, who share or participate in a specific loan) with a larger regional financial institution as the lead lender.
Item 6 - [Reserved] -39- Item 7 - Management's Discussion and Analysis of Financial Condition and Results of Operations The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our audited consolidated financial statements and the accompanying notes included elsewhere in this Annual Report on Form 10-K.
Item 6 - [Reserved] -38- Item 7 - Management's Discussion and Analysis of Financial Condition and Results of Operations The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our audited consolidated financial statements and the accompanying notes included elsewhere in this Annual Report on Form 10-K.
See below for our reconciliation of non-GAAP financial measures to their most directly comparable GAAP financial measures under the caption "Selected Financial Data— Non-GAAP Financial Measures." -65- Non-GAAP Financial Measures Our accounting and reporting policies conform to accounting principles generally accepted in the United States, or GAAP, and the prevailing practices in the banking industry.
See below for our reconciliation of non-GAAP financial measures to their most directly comparable GAAP financial measures under the caption "Selected Financial Data— Non-GAAP Financial Measures." -62- Non-GAAP Financial Measures Our accounting and reporting policies conform to accounting principles generally accepted in the United States, or GAAP, and the prevailing practices in the banking industry.
The gap indicates whether more assets or liabilities are subject to repricing over a given time period. The interest sensitivity analysis at December 31, 2022 illustrated below reflects a liability-sensitive position with a negative cumulative gap on a one-year basis.
The gap indicates whether more assets or liabilities are subject to repricing over a given time period. The interest sensitivity analysis at December 31, 2023 illustrated below reflects a liability-sensitive position with a negative cumulative gap on a one-year basis.
AOCI is comprised of unrealized gains and losses on available for sale securities, including unrealized losses on available for sale securities at the time of transfer to held to maturity. -41- • First Guaranty's Board of Directors declared cash dividends of $0.64 per common share in 2022.
AOCI is comprised of unrealized gains and losses on available for sale securities, including unrealized losses on available for sale securities at the time of transfer to held to maturity. • First Guaranty's Board of Directors declared cash dividends of $0.64 per common share in 2023 and 2022.
The Bank also maintains an investment portfolio comprised of government, government agency, corporate, and municipal securities. The Bank has thirty-six banking facilities and forty-eight automated teller machines (ATMs) in Southeast, Southwest, Central and North Louisiana, North Central Texas, Kentucky and West Virginia.
The Bank also maintains an investment portfolio comprised of government, government agency, corporate, and municipal securities. The Bank has thirty-six banking facilities and forty-nine automated teller machines (ATMs) in Southeast, Southwest, Central and North Louisiana, North Central Texas, Kentucky and West Virginia.
Quantitative measures established by regulation to ensure capital adequacy require the Bank to maintain minimum amounts and ratios of total and Tier 1 capital to risk-weighted assets and of Tier 1 capital to average assets. Management believes, as of December 31, 2022 and 2021, that the Bank met all capital adequacy requirements.
Quantitative measures established by regulation to ensure capital adequacy require the Bank to maintain minimum amounts and ratios of total and Tier 1 capital to risk-weighted assets and of Tier 1 capital to average assets. Management believes, as of December 31, 2023 and 2022, that the Bank met all capital adequacy requirements.
Fair values of other real estate owned ("OREO") at December 31, 2022 and 2021 are determined by sales agreement or appraisal, and costs to sell are based on estimation per the terms and conditions of the sales agreement or amounts commonly used in real estate transactions.
Fair values of other real estate owned ("OREO") at December 31, 2023 and 2022 are determined by sales agreement or appraisal, and costs to sell are based on estimation per the terms and conditions of the sales agreement or amounts commonly used in real estate transactions.
Corporate securities generally have a maturity of 10 years or less. U.S. Government securities consist of U.S. Treasury bills that have maturities of less than 30 days. Government agency securities generally have maturities of 15 years or less. Agency mortgage-backed securities have stated final maturities of 15 to 20 years. At December 31, 2022, the U.S.
Corporate securities generally have a maturity of 10 years or less. U.S. Government securities consist of U.S. Treasury bills that have maturities of less than 30 days. Government agency securities generally have maturities of 15 years or less. Agency mortgage-backed securities have stated final maturities of 15 to 20 years. At December 31, 2023, the U.S.
Unless otherwise noted, collateral or other security is not required to support financial instruments with credit risk. Set forth below is a summary of the notional amounts of the financial instruments with off-balance sheet risk at December 31, 2022 and December 31, 2021.
Unless otherwise noted, collateral or other security is not required to support financial instruments with credit risk. Set forth below is a summary of the notional amounts of the financial instruments with off-balance sheet risk at December 31, 2023 and December 31, 2022.
(22) Incorporated by reference to Exhibit 14.3 of the Annual Report on Form 10-K for the year ended December 31, 2021 filed by First Guaranty Bancshares, Inc. with the Securities and Exchange Commission on March 16, 2022.
(13) Incorporated by reference to Exhibit 14.3 of the Annual Report on Form 10-K for the year ended December 31, 2021 filed by First Guaranty Bancshares, Inc. with the Securities and Exchange Commission on March 16, 2022.
At December 31, 2022, the largest concentrations of unfunded commitments were lines of credit associated with construction and land development loans and commercial and industrial loans. Commercial and standby letters of credit are conditional commitments to guarantee the performance of a customer to a third party.
At December 31, 2023, the largest concentrations of unfunded commitments were lines of credit associated with construction and land development loans and commercial and industrial loans. Commercial and standby letters of credit are conditional commitments to guarantee the performance of a customer to a third party.
We also have audited First Guaranty’s internal control over financial reporting as of December 31, 2022, based on criteria established in Internal Control—Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).
We also have audited First Guaranty’s internal control over financial reporting as of December 31, 2023, based on criteria established in Internal Control—Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).
There are no conditions or events since the notification that Management believes have changed the Bank's category. First Guaranty Bank's actual capital amounts and ratios as of December 31, 2022 and 2021 are presented in the following table.
There are no conditions or events since the notification that Management believes have changed the Bank's category. First Guaranty Bank's actual capital amounts and ratios as of December 31, 2023 and 2022 are presented in the following table.
During the years ended 2022 and 2021, First Guaranty paid approximately $0.1 million and $0.1 million, respectively, for the purchase and maintenance of First Guaranty's automobiles to subsidiaries of Hood Automotive Group, of which William K. Hood, a director of First Guaranty, is President.
During the years ended 2023 and 2022, First Guaranty paid approximately $0.1 million and $0.1 million, respectively, for the purchase and maintenance of First Guaranty's automobiles to subsidiaries of Hood Automotive Group, of which William K. Hood, a director of First Guaranty, is President.
First Guaranty has chosen not to elect the fair value option for any items that are not already required to be measured at fair value in accordance with accounting principles generally accepted in the United States. -107- Note 20.
First Guaranty has chosen not to elect the fair value option for any items that are not already required to be measured at fair value in accordance with accounting principles generally accepted in the United States. -104- Note 20.
We have paid quarterly cash dividends on our common stock for each of the last 118 quarters dating back to the third quarter of 1993. The Board of Directors intends to continue to pay regular quarterly cash dividends on both our common and preferred stock.
We have paid quarterly cash dividends on our common stock for each of the last 122 quarters dating back to the third quarter of 1993. The Board of Directors intends to continue to pay regular quarterly cash dividends on both our common and preferred stock.
First Guaranty’s assets and liabilities are generally most affected by changes in the Federal Funds rate, LIBOR rate, short term Treasury rates such as one month and three month Treasury bills, and longer term Treasury rates such as the U.S. ten year Treasury rate.
First Guaranty’s assets and liabilities are generally most affected by changes in the Federal Funds rate, SOFR rate, short term Treasury rates such as one month and three month Treasury bills, and longer term Treasury rates such as the U.S. ten year Treasury rate.
Also, in our opinion, First Guaranty maintained, in all material respects, effective internal control over financial reporting as of December 31, 2022, based on criteria established in Internal Control—Integrated Framework (2013) issued by COSO.
Also, in our opinion, First Guaranty maintained, in all material respects, effective internal control over financial reporting as of December 31, 2023, based on criteria established in Internal Control—Integrated Framework (2013) issued by COSO.
First Guaranty is compliant with the established thresholds as of December 31, 2022. Personal, commercial and residential loans are granted to customers, most of who reside in northern and southern areas of Louisiana.
First Guaranty is compliant with the established thresholds as of December 31, 2023. Personal, commercial and residential loans are granted to customers, most of who reside in northern and southern areas of Louisiana.
First Guaranty's independent registered public accounting firm has also issued an attestation report, which expresses an unqualified opinion on the effectiveness of First Guaranty's internal control over financial reporting as of December 31, 2022.
First Guaranty's independent registered public accounting firm has also issued an attestation report, which expresses an unqualified opinion on the effectiveness of First Guaranty's internal control over financial reporting as of December 31, 2023.
A discussion regarding significant changes in our financial condition from December 31, 2020 to December 31, 2021 and our results of operations for the year ended December 31, 2021 can be found under "Item 7.
A discussion regarding significant changes in our financial condition from December 31, 2021 to December 31, 2022 and our results of operations for the year ended December 31, 2021 can be found under "Item 7.
At December 31, 2022 One Year or Less More than One Year through Five Years More than Five Years through Ten Years More than Ten Years (in thousands except for %) Carrying Value Weighted Average Yield Carrying Value Weighted Average Yield Carrying Value Weighted Average Yield Carrying Value Weighted Average Yield Available for sale: U.S.
At December 31, 2023 One Year or Less More than One Year through Five Years More than Five Years through Ten Years More than Ten Years (in thousands except for %) Carrying Value Weighted Average Yield Carrying Value Weighted Average Yield Carrying Value Weighted Average Yield Carrying Value Weighted Average Yield Available for sale: U.S.
The announced special assessment, as well as any future special assessments, increases in assessment rates or required prepayments in FDIC insurance premiums could reduce our profitability or limit our ability to pursue certain business opportunities, which could have a material adverse effect on our business, financial condition and results of operations. -31- Changes in the policies of monetary authorities and other government action could adversely affect our profitability.
Any future special assessments, increases in assessment rates or required prepayments in FDIC insurance premiums could reduce our profitability or limit our ability to pursue certain business opportunities, which could have a material adverse effect on our business, financial condition and results of operations. Changes in the policies of monetary authorities and other government action could adversely affect our profitability.
Certain critical estimates require judgment and estimates which are used in the preparation of the financial statements and accompanying notes. We have identified the following critical accounting estimate that is critical to an understanding of our financial condition and results of operations. Allowance for Loan and Lease Losses.
Certain critical estimates require judgment and estimates which are used in the preparation of the financial statements and accompanying notes. We have identified the following critical accounting estimate that is critical to an understanding of our financial condition and results of operations. Allowance for Credit Losses.
Community banks will have until Jan. 1, 2022, before the Community Bank Leverage Ratio requirement will return to 9%. A financial institution can elect to be subject to this new definition. The new rule took effect on January 1, 2020. The Bank did not elect to follow the Community Bank Leverage Ratio.
Community banks will have until Jan. 1, 2022, before the Community Bank Leverage Ratio requirement will return to 9%. A financial institution can elect to be subject to this new definition. The new rule took effect on January 1, 2020. The Bank has not elected to follow the Community Bank Leverage Ratio.
Based on our evaluation under the framework in Internal Control – Integrated Framework , Management concluded that internal control over financial reporting was effective as of December 31, 2022.
Based on our evaluation under the framework in Internal Control – Integrated Framework , Management concluded that internal control over financial reporting was effective as of December 31, 2023.
For the years ended December 31, 2022 and 2021, gross interest income which would have been recorded had the troubled debt restructured loans been current in accordance with their original terms amounted to $0.1 million and $0.2 million, respectively.
For the years ended December 31, 2023 and 2022, gross interest income which would have been recorded had the troubled debt restructured loans been current in accordance with their original terms amounted to $0.1 million and $0.1 million, respectively.
The increase in net interest income for the year ended December 31, 2022 as compared to the prior year was primarily due to an increase in the average balance of our total interest-earning assets and an increase in the average yield of our total interest-earning assets, partially offset by an increase in the average balance of our total interest-bearing liabilities and an increase in the average rate of our total interest-bearing liabilities.
The decrease in net interest income for the year ended December 31, 2023 as compared to the prior year was primarily due to an increase in the average balance of our total interest-bearing liabilities and an increase in the average rate of our total interest-bearing liabilities, partially offset by an increase in the average balance of our total interest-earning assets and an increase in the average yield of our total interest-earning assets.
Public fund deposits totaled $1.1 billion at December 31, 2022. Note 22. Litigation First Guaranty is subject to various legal proceedings in the normal course of its business. First Guaranty assesses its liabilities and contingencies in connection with outstanding legal proceedings.
Public fund deposits totaled $1.2 billion at December 31, 2023. Note 22. Litigation First Guaranty is subject to various legal proceedings in the normal course of its business. First Guaranty assesses its liabilities and contingencies in connection with outstanding legal proceedings.
Employee Benefit Plans First Guaranty has an employee savings plan to which employees, who meet certain service requirements, may defer 1% up to the IRS legal limit of their base salaries, 6% of which may be matched up to 100%, at its sole discretion. Contributions to the savings plan were $440,000 and $396,000 in 2022 and 2021, respectively.
Employee Benefit Plans First Guaranty has an employee savings plan to which employees, who meet certain service requirements, may defer 1% up to the IRS legal limit of their base salaries, 6% of which may be matched up to 100%, at its sole discretion. Contributions to the savings plan were $80,000 and $440,000 in 2023 and 2022, respectively.
We emphasize personal relationships and localized decision making to ensure that products and services are matched to customer needs. We compete for business principally on the basis of personal service to customers, customer access to officers and directors and competitive interest rates and fees. Total assets were $3.2 billion at December 31, 2022 and $2.9 billion at December 31, 2021.
We emphasize personal relationships and localized decision making to ensure that products and services are matched to customer needs. We compete for business principally on the basis of personal service to customers, customer access to officers and directors and competitive interest rates and fees. Total assets were $3.6 billion at December 31, 2023 and $3.2 billion at December 31, 2022.
Investment securities issued by the U.S. Government and Government sponsored enterprises with unrealized losses and the amount of unrealized losses on those investment securities that are the result of changes in market interest rates will not be other-than-temporarily impaired. First Guaranty has the ability and intent to hold these securities until recovery, which may not be until maturity.
Investment securities issued by the U.S. Government and Government sponsored enterprises with unrealized losses and the amount of unrealized losses on those investment securities that are the result of changes in market interest rates will not be credit impaired. First Guaranty has the ability and intent to hold these securities until recovery, which may not be until maturity.
First Guaranty Bank's capital conservation buffer was 3.16% at December 31, 2022. In addition, as a result of the legislation, the federal banking agencies have developed a "Community Bank Leverage Ratio" (the ratio of a bank's Tier 1 capital to average total consolidated assets) for financial institutions with assets of less than $10 billion.
First Guaranty Bank's capital conservation buffer was 3.20% at December 31, 2023. In addition, as a result of the legislation, the federal banking agencies have developed a "Community Bank Leverage Ratio" (the ratio of a bank's Tier 1 capital to average total consolidated assets) for financial institutions with assets of less than $10 billion.
Based on these factors, we have a concentration in loans of the type described in (ii), above, or 399% of our total capital at December 31, 2022. The purpose of the guidance is to assist banks in developing risk management practices and capital levels commensurate with the level and nature of real estate concentrations.
Based on these factors, we have a concentration in loans of the type described in (ii), above, or 369% of our total capital at December 31, 2023. The purpose of the guidance is to assist banks in developing risk management practices and capital levels commensurate with the level and nature of real estate concentrations.
Item 9B - Other Information None Item 9C - Disclosure Regarding Foreign Jurisdictions that Prevent Inspections Not applicable -114- Part III Item 10 – Directors, Executive Officers and Corporate Governance Pursuant to General Instruction G (3) to Form 10-K, information called for by this item will be incorporated by reference from First Guaranty's Definitive Proxy Statement to be filed within 120 days of fiscal year end.
Item 9C - Disclosure Regarding Foreign Jurisdictions that Prevent Inspections Not applicable -111- Part III Item 10 – Directors, Executive Officers and Corporate Governance Pursuant to General Instruction G (3) to Form 10-K, information called for by this item will be incorporated by reference from First Guaranty's Definitive Proxy Statement to be filed within 120 days of fiscal year end.
We review capital levels on a monthly basis. We evaluate a number of capital ratios, including Tier 1 capital to total adjusted assets (the leverage ratio) and Tier 1 capital to risk-weighted assets. At December 31, 2022, First Guaranty Bank was classified as well-capitalized. First Guaranty Bank's capital conservation buffer was 3.16% at December 31, 2022.
We review capital levels on a monthly basis. We evaluate a number of capital ratios, including Tier 1 capital to total adjusted assets (the leverage ratio) and Tier 1 capital to risk-weighted assets. At December 31, 2023, First Guaranty Bank was classified as well-capitalized. First Guaranty Bank's capital conservation buffer was 3.20% at December 31, 2023.
Public funds time deposits totaled $32.4 million at December 31, 2022 compared to $31.4 million at December 31, 2021. Public funds deposits increased due to new balances from existing customers that was primarily attributed to seasonal fluctuations. First Guaranty has developed a program for the retention and management of public funds deposits.
Public funds time deposits totaled $50.9 million at December 31, 2023 compared to $32.4 million at December 31, 2022. Public funds deposits increased due to new balances from existing customers that was primarily attributed to seasonal fluctuations. First Guaranty has developed a program for the retention and management of public funds deposits.
Dated: March 16, 2023 Pursuant to the requirements of the Securities and Exchange Act of 1934, this report has been signed below by the following persons on behalf of First Guaranty and in the capacities and on the dates indicated. /s/ Alton B. Lewis President, Chief Executive Officer and Director (Principal Executive Officer) March 16, 2023 Alton B.
Dated: March 15, 2024 Pursuant to the requirements of the Securities and Exchange Act of 1934, this report has been signed below by the following persons on behalf of First Guaranty and in the capacities and on the dates indicated. /s/ Alton B. Lewis President, Chief Executive Officer and Director (Principal Executive Officer) March 15, 2024 Alton B.
"Well Capitalized Minimums" At December 31, 2022 "Well Capitalized Minimums" At December 31, 2021 Tier 1 Leverage Ratio 5.00 % 9.35 % 5.00 % 8.71 % Tier 1 Risk-based Capital Ratio 8.00 % 10.31 % 8.00 % 10.22 % Total Risk-based Capital Ratio 10.00 % 11.16 % 10.00 % 11.22 % Common Equity Tier One Capital 6.50 % 10.31 % 6.50 % 10.22 % Off-balance sheet commitments We are a party to financial instruments with off-balance sheet risk in the normal course of business to meet the financing needs of our customers and to reduce our own exposure to fluctuations in interest rates.
"Well Capitalized Minimums" At December 31, 2023 "Well Capitalized Minimums" At December 31, 2022 Tier 1 Leverage Ratio 5.00 % 8.94 % 5.00 % 9.35 % Tier 1 Risk-based Capital Ratio 8.00 % 10.31 % 8.00 % 10.31 % Total Risk-based Capital Ratio 10.00 % 11.20 % 10.00 % 11.16 % Common Equity Tier One Capital 6.50 % 10.31 % 6.50 % 10.31 % Off-balance sheet commitments We are a party to financial instruments with off-balance sheet risk in the normal course of business to meet the financing needs of our customers and to reduce our own exposure to fluctuations in interest rates.
The specific component relates to loans that are classified as doubtful, substandard, and impaired. For such loans that are also classified as impaired, an allowance is established when the discounted cash flows (or collateral value or observable market price) of the impaired loan is lower than the carrying value of that loan.
The specific component relates to loans that are classified as doubtful, substandard, and individually evaluated for impairment. For such loans that are also classified as individually evaluated for impairment, an allowance is established when the discounted cash flows (or collateral value or observable market price) of the loan is lower than the carrying value of that loan.
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