Company: COFS
Filing Date: 2025-03-11
Form Type: 10-K
Source: 0000950170-25-036839
Chunk: 50

Company: CHOICEONE FINANCIAL SERVICES INC
Filing Date: 2025-03-11
Form: 10-K
Item: Item 7
Chunk 50
---
    $
    15,685

    $
    7,619

    Allowance for credit losses as a percentage of:

    Total loans as of year end

    1.07
     
    %
     
    1.11
     
    %
     
    0.64
     
    %

    Nonaccrual loans, accrual loans past due 90 days or more and troubled debt restructurings

    447
     
    %
     
    820
     
    %
     
    286
     
    %

    Ratio of net charge-offs during the period to average loans outstanding during the period

    0.03
     
    %
    0.03
     
    %
    0.03
     
    %

    Loan recoveries as a percentage of prior year's charge-offs

    55
     
    %
    56
     
    %
    52
     
    %

Note: In the table above, "consumer" includes deposit account charge-offs and recoveries.

The ACL consists of general and specific components. The general component covers loans collectively evaluated for credit loss and is based on peer historical loss experience adjusted for current and forecasted factors. Management's adjustment for current and forecasted factors is based on trends in delinquencies, trends in charge-offs and recoveries, trends in the volume of loans, changes in underwriting standards, trends in loan review findings, the experience and ability of lending staff, and a reasonable and supportable economic forecast described further below.

The determination of our loss factors is based, in part, upon benchmark peer loss history adjusted for qualitative factors that, in management's judgment, affect the collectability of the portfolio as of the analysis date.  ChoiceOne's lookback period of benchmark peer net charge-off history was from January 1, 2004 through December 31, 2019 for this analysis. 

Loans individually evaluated for credit losses increased by $2.0 million to $4.1 million during the year ended December 31, 2024, and the ACL related to these individually evaluated loans increased by $108,000 during the same period largely due to the balance increase.

Nonperforming loans, which includes Other Real Estate Owned ("OREO") but excludes performing troubled loan modifications ("TLM"), increased by $1.9 million to $3.8 million at December 31, 2024, compared to a historically