Company: UBCP
Filing Date: 2025-03-14
Form Type: 10-K
Source: 0001410578-25-000351
Chunk: 14

Company: UNITED BANCORP INC /OH/
Filing Date: 2025-03-14
Form: 10-K
Item: Item 1
Chunk 14
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 1) when it is determined that foreclosure is probable, 2) substandard, doubtful and nonperforming loans when repayment is expected to be provided substantially through the operation or sale of the collateral, 3) when it is determined by management that a loan does not share similar risk characteristics with other loans. Specific reserves are established based on the following three acceptable methods for measuring the ACL: 1) the present value of expected future cash flows discounted at the loan’s original effective interest rate; 2) the loan’s observable market price; or 3) the fair value of the collateral when the loan is collateral dependent. Our individual loan evaluations consist primarily of the fair value of collateral method because most of our loans are collateral dependent. Collateral values are discounted to consider disposition costs when appropriate. A specific reserve is established or a charge-off is taken if the fair value of the loan is less than the loan balance.

For additional explanation of factors which influence management’s judgment in determining amounts charged to expense, refer to pages 10-22 of the “ Management’s Discussion and Analysis” and Notes to Consolidated Financial Statements set forth in our 2024 Annual Report, which is incorporated herein by reference.

  A       Analysis of the Allowance for Credit Losses  

The following table provides key credit ratios for each applicable period.

 ──────────────────────────────────────────────────────────────────────────────────────────────────────────────────────────────────────
  Ratio of net charge-offs to average loans outstanding for the year                                   0.07        0.02         0.14  
  Ratio of commercial loans and industrial net charge-offs to average commercial loans                 0.13      (0.03)       (0.01)  
  Ratio of commercial real estate loans net charge-offs to average commercial real estate loans        0.00        0.00         0.21  
  Ratio of real estate loans net charge-offs to average real estate loans                              0.19        0.00         0.00  
  Ratio of installment loans net charge-off to average consumer loans                                  2.16        1.93         1.90  
  Total allowance for credit losses to total loans                                                     0.82        0.81         0.45  
  Nonaccrual loans to total loans                                                                      0.15        0.10         0.04  
  Total allowance for credit losses to nonperforming loans                                           508.33      611.23