Bridgewater Bancshares, Inc. Annual Report

management strives to maintain an allowance it deems adequate, future economic changes, deterioration of borrowers’ creditworthiness, and the impact of examinations by regulatory agencies all could cause changes to the allowance for loan losses. At December 31, 2019, the allowance for loan losses was $22.5 million, an increase of $2.5 million from $20.0 million at December 31, 2018. Net charge-offs totaled $205,000 during the year ended December 31, 2019 and $46,000 during the year ended December 31, 2018. The allowance for loan losses as a percentage of total loans was 1.18% at December 31, 2019 and 1.20% at December 31, 2018. The following presents a summary of the activity in the allowance for loan loss reserve for the periods indicated: 2015 Balance, Beginning of Period. . . . . . . . . . . $ 20,031 $ 16,502 $ 12,333 $ 10,052 $ 9,489 Charge-offs: Commercial . . . . . . . . . . . . . . . . . . . . . . . . 160 10 1 107 34 Construction and Land Development . . . — 358 — 248 348 Real Estate Mortgage: 1 - 4 Family Mortgage . . . . . . . . . . . . . . 195 21 — 1 662 CRE Owner Occupied . . . . . . . . . . . . . . — — — 123 — CRE Nonowner Occupied . . . . . . . . . . . — — 111 613 — Total Real Estate Mortgage Loans . . . . . 195 21 111 737 662 Consumer and Other. . . . . . . . . . . . . . . . . 33 32 65 22 — Total Charge-offs . . . . . . . . . . . . . . . . . . . . 388 421 177 1,114 1,044 Recoveries: Commercial . . . . . . . . . . . . . . . . . . . . . . . . 8 25 5 101 1 Construction and Land Development . . . 1 285 24 8 29 Real Estate Mortgage: 1 - 4 Family Mortgage . . . . . . . . . . . . . . 168 59 138 32 29 Multifamily . . . . . . . . . . . . . . . . . . . . . . . — — — — 5 CRE Owner Occupied . . . . . . . . . . . . . . — — — — 28 Total Real Estate Mortgage Loans . . . . . 168 59 138 32 62 Consumer and Other. . . . . . . . . . . . . . . . . 6 6 4 4 15 Total Recoveries . . . . . . . . . . . . . . . . . . . . . 183 375 171 145 107 Net Charge-offs . . . . . . . . . . . . . . . . . . . . . . 205 46 6 969 937 Provision for Loan Losses . . . . . . . . . . . . . 2,700 3,575 4,175 3,250 1,500 Balance at End of Period . . . . . . . . . . . . . . $ 22,526 $ 20,031 $ 16,502 $ 12,333 $ 10,052 Gross Loans, End of Period . . . . . . . . . . . . 1,912,038 1,664,931 1,347,113 1,000,739 799,497 Average Loans. . . . . . . . . . . . . . . . . . . . . . . 1,785,937 1,491,166 1,177,491 896,915 684,498 Net Charge-offs to Average Loans. . . . . . . 0.01 % 0.00 % 0.00 % 0.11 % 0.14 % Allowance to Total Gross Loans . . . . . . . . 1.18 % 1.20 % 1.22 % 1.23 % 1.26 % As of and for the year ended December 31, (dollars in thousands) 2019 2018 2017 2016

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