0000893847--12-312021Q1P1YfalseP6M0000893847hwbk:RepurchaseProgramMember2021-03-310000893847hwbk:RepurchaseProgramMember2020-09-300000893847us-gaap:TreasuryStockMember2021-03-310000893847us-gaap:RetainedEarningsMember2021-03-310000893847us-gaap:CommonStockMember2021-03-310000893847us-gaap:AdditionalPaidInCapitalMember2021-03-310000893847us-gaap:TreasuryStockMember2020-12-310000893847us-gaap:RetainedEarningsMember2020-12-310000893847us-gaap:CommonStockMember2020-12-310000893847us-gaap:AdditionalPaidInCapitalMember2020-12-310000893847us-gaap:TreasuryStockMember2020-03-310000893847us-gaap:RetainedEarningsMember2020-03-310000893847us-gaap:CommonStockMember2020-03-310000893847us-gaap:AdditionalPaidInCapitalMember2020-03-310000893847us-gaap:TreasuryStockMember2019-12-310000893847us-gaap:RetainedEarningsMember2019-12-310000893847us-gaap:CommonStockMember2019-12-310000893847us-gaap:AdditionalPaidInCapitalMember2019-12-310000893847us-gaap:ServicingContractsMemberus-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2021-03-310000893847us-gaap:ServicingContractsMemberus-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2021-03-310000893847us-gaap:ServicingContractsMemberus-gaap:FairValueMeasurementsRecurringMember2021-03-310000893847us-gaap:ServicingContractsMemberus-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2020-12-310000893847us-gaap:ServicingContractsMemberus-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2020-12-310000893847us-gaap:ServicingContractsMemberus-gaap:FairValueMeasurementsRecurringMember2020-12-310000893847us-gaap:ServicingContractsMember2019-12-310000893847us-gaap:MaturityOvernightMemberus-gaap:USGovernmentSponsoredEnterprisesDebtSecuritiesMember2021-03-310000893847us-gaap:MaturityOvernightMemberus-gaap:MortgageBackedSecuritiesMember2021-03-310000893847us-gaap:MaturityOver90DaysMemberus-gaap:USGovernmentSponsoredEnterprisesDebtSecuritiesMember2021-03-310000893847us-gaap:MaturityOver90DaysMemberus-gaap:MortgageBackedSecuritiesMember2021-03-310000893847us-gaap:Maturity30To90DaysMemberus-gaap:USGovernmentSponsoredEnterprisesDebtSecuritiesMember2021-03-310000893847us-gaap:Maturity30To90DaysMemberus-gaap:MortgageBackedSecuritiesMember2021-03-310000893847us-gaap:MaturityOvernightMember2021-03-310000893847us-gaap:MaturityOver90DaysMember2021-03-310000893847us-gaap:Maturity30To90DaysMember2021-03-310000893847us-gaap:MaturityOvernightMemberus-gaap:USGovernmentSponsoredEnterprisesDebtSecuritiesMember2020-12-310000893847us-gaap:MaturityOvernightMemberus-gaap:MortgageBackedSecuritiesMember2020-12-310000893847us-gaap:MaturityOvernightMemberhwbk:USGovernmentAndFederalAgencyObligationsMember2020-12-310000893847us-gaap:MaturityOver90DaysMemberus-gaap:USGovernmentSponsoredEnterprisesDebtSecuritiesMember2020-12-310000893847us-gaap:MaturityOver90DaysMemberus-gaap:MortgageBackedSecuritiesMember2020-12-310000893847us-gaap:MaturityOver90DaysMemberhwbk:USGovernmentAndFederalAgencyObligationsMember2020-12-310000893847us-gaap:Maturity30To90DaysMemberus-gaap:USGovernmentSponsoredEnterprisesDebtSecuritiesMember2020-12-310000893847us-gaap:Maturity30To90DaysMemberus-gaap:MortgageBackedSecuritiesMember2020-12-310000893847us-gaap:Maturity30To90DaysMemberhwbk:USGovernmentAndFederalAgencyObligationsMember2020-12-310000893847us-gaap:MaturityOvernightMember2020-12-310000893847us-gaap:MaturityOver90DaysMember2020-12-310000893847us-gaap:Maturity30To90DaysMember2020-12-310000893847us-gaap:ServiceMember2021-01-012021-03-310000893847us-gaap:FiduciaryAndTrustMember2021-01-012021-03-310000893847us-gaap:BankServicingMember2021-01-012021-03-310000893847us-gaap:BankingMember2021-01-012021-03-310000893847us-gaap:ServiceMember2020-01-012020-03-310000893847us-gaap:FiduciaryAndTrustMember2020-01-012020-03-310000893847us-gaap:BankServicingMember2020-01-012020-03-310000893847us-gaap:BankingMember2020-01-012020-03-310000893847us-gaap:CommercialPortfolioSegmentMember2021-03-310000893847us-gaap:CommercialPortfolioSegmentMember2020-12-310000893847us-gaap:UnallocatedFinancingReceivablesMember2021-01-012021-03-310000893847us-gaap:UnallocatedFinancingReceivablesMember2020-01-012020-03-310000893847us-gaap:AccumulatedNetUnrealizedInvestmentGainLossMember2021-01-012021-03-310000893847us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember2021-01-012021-03-310000893847us-gaap:AccumulatedNetUnrealizedInvestmentGainLossMember2020-01-012020-03-310000893847us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember2020-01-012020-03-310000893847us-gaap:CommercialRealEstatePortfolioSegmentMemberus-gaap:MortgagesMemberus-gaap:SubstandardMember2021-03-310000893847us-gaap:CommercialRealEstatePortfolioSegmentMemberus-gaap:MortgagesMemberus-gaap:SpecialMentionMember2021-03-310000893847us-gaap:CommercialRealEstatePortfolioSegmentMemberus-gaap:MortgagesMemberus-gaap:PerformingFinancingReceivableMember2021-03-310000893847us-gaap:CommercialRealEstatePortfolioSegmentMemberus-gaap:MortgagesMemberhwbk:NonaccrualFinancingReceivableMember2021-03-310000893847us-gaap:CommercialRealEstatePortfolioSegmentMemberus-gaap:MortgagesMemberhwbk:LoansInRiskCategoriesMember2021-03-310000893847us-gaap:CommercialRealEstatePortfolioSegmentMemberus-gaap:ConstructionLoansMemberus-gaap:SubstandardMember2021-03-310000893847us-gaap:CommercialRealEstatePortfolioSegmentMemberus-gaap:ConstructionLoansMemberus-gaap:SpecialMentionMember2021-03-310000893847us-gaap:CommercialRealEstatePortfolioSegmentMemberus-gaap:ConstructionLoansMemberus-gaap:PerformingFinancingReceivableMember2021-03-310000893847us-gaap:CommercialRealEstatePortfolioSegmentMemberus-gaap:ConstructionLoansMemberhwbk:NonaccrualFinancingReceivableMember2021-03-310000893847us-gaap:CommercialRealEstatePortfolioSegmentMemberus-gaap:ConstructionLoansMemberhwbk:LoansInRiskCategoriesMember2021-03-310000893847hwbk:ResidentialRealEstatePortfolioSegmentMemberus-gaap:MortgagesMemberus-gaap:SubstandardMember2021-03-310000893847hwbk:ResidentialRealEstatePortfolioSegmentMemberus-gaap:MortgagesMemberus-gaap:SpecialMentionMember2021-03-310000893847hwbk:ResidentialRealEstatePortfolioSegmentMemberus-gaap:MortgagesMemberus-gaap:PerformingFinancingReceivableMember2021-03-310000893847hwbk:ResidentialRealEstatePortfolioSegmentMemberus-gaap:MortgagesMemberhwbk:NonaccrualFinancingReceivableMember2021-03-310000893847hwbk:ResidentialRealEstatePortfolioSegmentMemberus-gaap:MortgagesMemberhwbk:LoansInRiskCategoriesMember2021-03-310000893847hwbk:ResidentialRealEstatePortfolioSegmentMemberus-gaap:ConstructionLoansMemberus-gaap:SubstandardMember2021-03-310000893847hwbk:ResidentialRealEstatePortfolioSegmentMemberus-gaap:ConstructionLoansMemberus-gaap:SpecialMentionMember2021-03-310000893847hwbk:ResidentialRealEstatePortfolioSegmentMemberus-gaap:ConstructionLoansMemberus-gaap:PerformingFinancingReceivableMember2021-03-310000893847hwbk:ResidentialRealEstatePortfolioSegmentMemberus-gaap:ConstructionLoansMemberhwbk:NonaccrualFinancingReceivableMember2021-03-310000893847hwbk:ResidentialRealEstatePortfolioSegmentMemberus-gaap:ConstructionLoansMemberhwbk:LoansInRiskCategoriesMember2021-03-310000893847hwbk:InstallmentAndOtherConsumerPortfolioSegmentMemberus-gaap:SubstandardMember2021-03-310000893847hwbk:InstallmentAndOtherConsumerPortfolioSegmentMemberus-gaap:SpecialMentionMember2021-03-310000893847hwbk:InstallmentAndOtherConsumerPortfolioSegmentMemberus-gaap:PerformingFinancingReceivableMember2021-03-310000893847hwbk:InstallmentAndOtherConsumerPortfolioSegmentMemberhwbk:NonaccrualFinancingReceivableMember2021-03-310000893847hwbk:InstallmentAndOtherConsumerPortfolioSegmentMemberhwbk:LoansInRiskCategoriesMember2021-03-310000893847hwbk:CommercialFinancialAndAgriculturalPortfolioSegmentMemberus-gaap:SubstandardMember2021-03-310000893847hwbk:CommercialFinancialAndAgriculturalPortfolioSegmentMemberus-gaap:SpecialMentionMember2021-03-310000893847hwbk:CommercialFinancialAndAgriculturalPortfolioSegmentMemberus-gaap:PerformingFinancingReceivableMember2021-03-310000893847hwbk:CommercialFinancialAndAgriculturalPortfolioSegmentMemberhwbk:NonaccrualFinancingReceivableMember2021-03-310000893847hwbk:CommercialFinancialAndAgriculturalPortfolioSegmentMemberhwbk:LoansInRiskCategoriesMember2021-03-310000893847us-gaap:SubstandardMember2021-03-310000893847us-gaap:SpecialMentionMember2021-03-310000893847us-gaap:PerformingFinancingReceivableMember2021-03-310000893847hwbk:NonaccrualFinancingReceivableMember2021-03-310000893847hwbk:LoansInRiskCategoriesMember2021-03-310000893847us-gaap:CommercialRealEstatePortfolioSegmentMemberus-gaap:MortgagesMemberus-gaap:SubstandardMember2020-12-310000893847us-gaap:CommercialRealEstatePortfolioSegmentMemberus-gaap:MortgagesMemberus-gaap:SpecialMentionMember2020-12-310000893847us-gaap:CommercialRealEstatePortfolioSegmentMemberus-gaap:MortgagesMemberus-gaap:PerformingFinancingReceivableMember2020-12-310000893847us-gaap:CommercialRealEstatePortfolioSegmentMemberus-gaap:MortgagesMemberhwbk:NonaccrualFinancingReceivableMember2020-12-310000893847us-gaap:CommercialRealEstatePortfolioSegmentMemberus-gaap:MortgagesMemberhwbk:LoansInRiskCategoriesMember2020-12-310000893847us-gaap:CommercialRealEstatePortfolioSegmentMemberus-gaap:ConstructionLoansMemberus-gaap:SubstandardMember2020-12-310000893847us-gaap:CommercialRealEstatePortfolioSegmentMemberus-gaap:ConstructionLoansMemberus-gaap:SpecialMentionMember2020-12-310000893847us-gaap:CommercialRealEstatePortfolioSegmentMemberus-gaap:ConstructionLoansMemberus-gaap:PerformingFinancingReceivableMember2020-12-310000893847us-gaap:CommercialRealEstatePortfolioSegmentMemberus-gaap:ConstructionLoansMemberhwbk:NonaccrualFinancingReceivableMember2020-12-310000893847us-gaap:CommercialRealEstatePortfolioSegmentMemberus-gaap:ConstructionLoansMemberhwbk:LoansInRiskCategoriesMember2020-12-310000893847hwbk:ResidentialRealEstatePortfolioSegmentMemberus-gaap:MortgagesMemberus-gaap:SubstandardMember2020-12-310000893847hwbk:ResidentialRealEstatePortfolioSegmentMemberus-gaap:MortgagesMemberus-gaap:SpecialMentionMember2020-12-310000893847hwbk:ResidentialRealEstatePortfolioSegmentMemberus-gaap:MortgagesMemberus-gaap:PerformingFinancingReceivableMember2020-12-310000893847hwbk:ResidentialRealEstatePortfolioSegmentMemberus-gaap:MortgagesMemberhwbk:NonaccrualFinancingReceivableMember2020-12-310000893847hwbk:ResidentialRealEstatePortfolioSegmentMemberus-gaap:MortgagesMemberhwbk:LoansInRiskCategoriesMember2020-12-310000893847hwbk:ResidentialRealEstatePortfolioSegmentMemberus-gaap:ConstructionLoansMemberus-gaap:SubstandardMember2020-12-310000893847hwbk:ResidentialRealEstatePortfolioSegmentMemberus-gaap:ConstructionLoansMemberus-gaap:SpecialMentionMember2020-12-310000893847hwbk:ResidentialRealEstatePortfolioSegmentMemberus-gaap:ConstructionLoansMemberus-gaap:PerformingFinancingReceivableMember2020-12-310000893847hwbk:ResidentialRealEstatePortfolioSegmentMemberus-gaap:ConstructionLoansMemberhwbk:NonaccrualFinancingReceivableMember2020-12-310000893847hwbk:ResidentialRealEstatePortfolioSegmentMemberus-gaap:ConstructionLoansMemberhwbk:LoansInRiskCategoriesMember2020-12-310000893847hwbk:InstallmentAndOtherConsumerPortfolioSegmentMemberus-gaap:SubstandardMember2020-12-310000893847hwbk:InstallmentAndOtherConsumerPortfolioSegmentMemberus-gaap:SpecialMentionMember2020-12-310000893847hwbk:InstallmentAndOtherConsumerPortfolioSegmentMemberus-gaap:PerformingFinancingReceivableMember2020-12-310000893847hwbk:InstallmentAndOtherConsumerPortfolioSegmentMemberhwbk:NonaccrualFinancingReceivableMember2020-12-310000893847hwbk:InstallmentAndOtherConsumerPortfolioSegmentMemberhwbk:LoansInRiskCategoriesMember2020-12-310000893847hwbk:CommercialFinancialAndAgriculturalPortfolioSegmentMemberus-gaap:SubstandardMember2020-12-310000893847hwbk:CommercialFinancialAndAgriculturalPortfolioSegmentMemberus-gaap:SpecialMentionMember2020-12-310000893847hwbk:CommercialFinancialAndAgriculturalPortfolioSegmentMemberus-gaap:PerformingFinancingReceivableMember2020-12-310000893847hwbk:CommercialFinancialAndAgriculturalPortfolioSegmentMemberhwbk:NonaccrualFinancingReceivableMember2020-12-310000893847hwbk:CommercialFinancialAndAgriculturalPortfolioSegmentMemberhwbk:LoansInRiskCategoriesMember2020-12-310000893847us-gaap:SubstandardMember2020-12-310000893847us-gaap:SpecialMentionMember2020-12-310000893847us-gaap:PerformingFinancingReceivableMember2020-12-310000893847hwbk:NonaccrualFinancingReceivableMember2020-12-310000893847hwbk:LoansInRiskCategoriesMember2020-12-310000893847us-gaap:CommercialRealEstatePortfolioSegmentMemberus-gaap:MortgagesMember2020-03-310000893847us-gaap:CommercialRealEstatePortfolioSegmentMemberus-gaap:ConstructionLoansMember2020-03-310000893847hwbk:ResidentialRealEstatePortfolioSegmentMemberus-gaap:MortgagesMember2020-03-310000893847hwbk:ResidentialRealEstatePortfolioSegmentMemberus-gaap:ConstructionLoansMember2020-03-310000893847us-gaap:UnallocatedFinancingReceivablesMember2020-03-310000893847hwbk:InstallmentAndOtherConsumerPortfolioSegmentMember2020-03-310000893847hwbk:CommercialFinancialAndAgriculturalPortfolioSegmentMember2020-03-310000893847us-gaap:CommercialRealEstatePortfolioSegmentMemberus-gaap:MortgagesMember2019-12-310000893847us-gaap:CommercialRealEstatePortfolioSegmentMemberus-gaap:ConstructionLoansMember2019-12-310000893847hwbk:ResidentialRealEstatePortfolioSegmentMemberus-gaap:MortgagesMember2019-12-310000893847hwbk:ResidentialRealEstatePortfolioSegmentMemberus-gaap:ConstructionLoansMember2019-12-310000893847us-gaap:UnallocatedFinancingReceivablesMember2019-12-310000893847hwbk:InstallmentAndOtherConsumerPortfolioSegmentMember2019-12-310000893847hwbk:CommercialFinancialAndAgriculturalPortfolioSegmentMember2019-12-310000893847srt:MinimumMember2021-03-310000893847srt:MaximumMember2021-03-310000893847hwbk:ResidentialRealEstatePortfolioSegmentMemberus-gaap:ConstructionLoansMember2020-01-012020-03-310000893847us-gaap:CommercialRealEstatePortfolioSegmentMemberus-gaap:ConstructionLoansMember2021-01-012021-03-310000893847us-gaap:CommercialRealEstatePortfolioSegmentMember2021-01-012021-03-310000893847hwbk:ResidentialRealEstatePortfolioSegmentMember2021-01-012021-03-310000893847us-gaap:CommercialRealEstatePortfolioSegmentMemberus-gaap:ConstructionLoansMember2020-01-012020-03-310000893847us-gaap:CommercialRealEstatePortfolioSegmentMember2020-01-012020-03-310000893847hwbk:ResidentialRealEstatePortfolioSegmentMember2020-01-012020-03-310000893847us-gaap:CommercialRealEstatePortfolioSegmentMember2021-03-310000893847hwbk:ResidentialRealEstatePortfolioSegmentMember2021-03-310000893847hwbk:CollateralDependentImpairedLoansMember2021-03-310000893847us-gaap:CommercialRealEstatePortfolioSegmentMember2020-12-310000893847hwbk:ResidentialRealEstatePortfolioSegmentMember2020-12-310000893847hwbk:CollateralDependentImpairedLoansMember2020-03-310000893847us-gaap:CommercialRealEstatePortfolioSegmentMemberus-gaap:MortgagesMemberus-gaap:FinancingReceivables1To29DaysPastDueMember2021-03-310000893847us-gaap:CommercialRealEstatePortfolioSegmentMemberus-gaap:MortgagesMemberhwbk:FinancingReceivables30To89DaysPastDueMember2021-03-310000893847us-gaap:CommercialRealEstatePortfolioSegmentMemberus-gaap:ConstructionLoansMemberus-gaap:FinancingReceivables1To29DaysPastDueMember2021-03-310000893847us-gaap:CommercialRealEstatePortfolioSegmentMemberus-gaap:ConstructionLoansMemberhwbk:FinancingReceivables30To89DaysPastDueMember2021-03-310000893847hwbk:ResidentialRealEstatePortfolioSegmentMemberus-gaap:MortgagesMemberus-gaap:FinancingReceivables1To29DaysPastDueMember2021-03-310000893847hwbk:ResidentialRealEstatePortfolioSegmentMemberus-gaap:MortgagesMemberhwbk:FinancingReceivables30To89DaysPastDueMember2021-03-310000893847hwbk:ResidentialRealEstatePortfolioSegmentMemberus-gaap:ConstructionLoansMemberus-gaap:FinancingReceivables1To29DaysPastDueMember2021-03-310000893847hwbk:ResidentialRealEstatePortfolioSegmentMemberus-gaap:ConstructionLoansMemberhwbk:FinancingReceivables30To89DaysPastDueMember2021-03-310000893847hwbk:InstallmentAndOtherConsumerPortfolioSegmentMemberus-gaap:FinancingReceivables1To29DaysPastDueMember2021-03-310000893847hwbk:InstallmentAndOtherConsumerPortfolioSegmentMemberhwbk:FinancingReceivables30To89DaysPastDueMember2021-03-310000893847hwbk:CommercialFinancialAndAgriculturalPortfolioSegmentMemberus-gaap:FinancingReceivables1To29DaysPastDueMember2021-03-310000893847hwbk:CommercialFinancialAndAgriculturalPortfolioSegmentMemberhwbk:FinancingReceivables30To89DaysPastDueMember2021-03-310000893847us-gaap:FinancingReceivables1To29DaysPastDueMember2021-03-310000893847hwbk:FinancingReceivables30To89DaysPastDueMember2021-03-310000893847us-gaap:CommercialRealEstatePortfolioSegmentMemberus-gaap:MortgagesMemberus-gaap:FinancingReceivables1To29DaysPastDueMember2020-12-310000893847us-gaap:CommercialRealEstatePortfolioSegmentMemberus-gaap:MortgagesMemberhwbk:FinancingReceivables30To89DaysPastDueMember2020-12-310000893847us-gaap:CommercialRealEstatePortfolioSegmentMemberus-gaap:ConstructionLoansMemberus-gaap:FinancingReceivables1To29DaysPastDueMember2020-12-310000893847us-gaap:CommercialRealEstatePortfolioSegmentMemberus-gaap:ConstructionLoansMemberhwbk:FinancingReceivables30To89DaysPastDueMember2020-12-310000893847hwbk:ResidentialRealEstatePortfolioSegmentMemberus-gaap:MortgagesMemberus-gaap:FinancingReceivables1To29DaysPastDueMember2020-12-310000893847hwbk:ResidentialRealEstatePortfolioSegmentMemberus-gaap:MortgagesMemberhwbk:FinancingReceivables30To89DaysPastDueMember2020-12-310000893847hwbk:ResidentialRealEstatePortfolioSegmentMemberus-gaap:ConstructionLoansMemberus-gaap:FinancingReceivables1To29DaysPastDueMember2020-12-310000893847hwbk:ResidentialRealEstatePortfolioSegmentMemberus-gaap:ConstructionLoansMemberhwbk:FinancingReceivables30To89DaysPastDueMember2020-12-310000893847hwbk:InstallmentAndOtherConsumerPortfolioSegmentMemberus-gaap:FinancingReceivables1To29DaysPastDueMember2020-12-310000893847hwbk:InstallmentAndOtherConsumerPortfolioSegmentMemberhwbk:FinancingReceivables30To89DaysPastDueMember2020-12-310000893847hwbk:CommercialFinancialAndAgriculturalPortfolioSegmentMemberus-gaap:FinancingReceivables1To29DaysPastDueMember2020-12-310000893847hwbk:CommercialFinancialAndAgriculturalPortfolioSegmentMemberhwbk:FinancingReceivables30To89DaysPastDueMember2020-12-310000893847us-gaap:FinancingReceivables1To29DaysPastDueMember2020-12-310000893847hwbk:FinancingReceivables30To89DaysPastDueMember2020-12-310000893847us-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMember2021-01-012021-03-310000893847us-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMember2020-01-012020-03-310000893847us-gaap:PerformingFinancingReceivableMember2021-03-310000893847us-gaap:NonperformingFinancingReceivableMember2021-03-310000893847us-gaap:PerformingFinancingReceivableMember2020-12-310000893847us-gaap:NonperformingFinancingReceivableMember2020-12-310000893847us-gaap:CommercialRealEstatePortfolioSegmentMemberus-gaap:MortgagesMember2021-03-310000893847us-gaap:CommercialRealEstatePortfolioSegmentMemberus-gaap:ConstructionLoansMember2021-03-310000893847hwbk:ResidentialRealEstatePortfolioSegmentMemberus-gaap:MortgagesMember2021-03-310000893847hwbk:ResidentialRealEstatePortfolioSegmentMemberus-gaap:ConstructionLoansMember2021-03-310000893847us-gaap:UnallocatedFinancingReceivablesMember2021-03-310000893847hwbk:InstallmentAndOtherConsumerPortfolioSegmentMember2021-03-310000893847us-gaap:CommercialRealEstatePortfolioSegmentMemberus-gaap:MortgagesMember2020-12-310000893847us-gaap:CommercialRealEstatePortfolioSegmentMemberus-gaap:ConstructionLoansMember2020-12-310000893847hwbk:ResidentialRealEstatePortfolioSegmentMemberus-gaap:MortgagesMember2020-12-310000893847hwbk:ResidentialRealEstatePortfolioSegmentMemberus-gaap:ConstructionLoansMember2020-12-310000893847us-gaap:UnallocatedFinancingReceivablesMember2020-12-310000893847hwbk:InstallmentAndOtherConsumerPortfolioSegmentMember2020-12-310000893847us-gaap:ServicingContractsMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2021-03-310000893847us-gaap:ServicingContractsMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2020-12-310000893847us-gaap:ServicingContractsMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2020-03-310000893847us-gaap:ServicingContractsMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2019-12-310000893847us-gaap:ServicingContractsMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2021-01-012021-03-310000893847us-gaap:ServicingContractsMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2020-01-012020-03-310000893847us-gaap:StandbyLettersOfCreditMember2021-03-310000893847us-gaap:LoanOriginationCommitmentsMember2021-03-310000893847us-gaap:CommitmentsToExtendCreditMember2021-03-310000893847us-gaap:StandbyLettersOfCreditMember2020-12-310000893847us-gaap:LoanOriginationCommitmentsMember2020-12-310000893847us-gaap:CommitmentsToExtendCreditMember2020-12-310000893847us-gaap:TreasuryStockMember2021-01-012021-03-310000893847us-gaap:RetainedEarningsMember2021-01-012021-03-310000893847us-gaap:CommonStockMember2021-01-012021-03-310000893847us-gaap:AdditionalPaidInCapitalMember2021-01-012021-03-310000893847us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-01-012021-03-310000893847us-gaap:TreasuryStockMember2020-01-012020-03-310000893847us-gaap:RetainedEarningsMember2020-01-012020-03-310000893847us-gaap:CommonStockMember2020-01-012020-03-310000893847us-gaap:AdditionalPaidInCapitalMember2020-01-012020-03-310000893847us-gaap:AccumulatedOtherComprehensiveIncomeMember2020-01-012020-03-3100008938472021-03-222021-03-220000893847hwbk:SupplementalExecutiveRetirementPlanMember2021-03-310000893847hwbk:SupplementalExecutiveRetirementPlanMember2021-01-012021-03-310000893847hwbk:SupplementalExecutiveRetirementPlanMember2020-01-012020-03-3100008938472019-12-310000893847us-gaap:USTreasurySecuritiesMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2021-03-310000893847us-gaap:USTreasurySecuritiesMemberus-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2021-03-310000893847us-gaap:USTreasurySecuritiesMemberus-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2021-03-310000893847us-gaap:USStatesAndPoliticalSubdivisionsMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2021-03-310000893847us-gaap:USStatesAndPoliticalSubdivisionsMemberus-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2021-03-310000893847us-gaap:USStatesAndPoliticalSubdivisionsMemberus-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2021-03-310000893847us-gaap:USGovernmentSponsoredEnterprisesDebtSecuritiesMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2021-03-310000893847us-gaap:USGovernmentSponsoredEnterprisesDebtSecuritiesMemberus-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2021-03-310000893847us-gaap:USGovernmentSponsoredEnterprisesDebtSecuritiesMemberus-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2021-03-310000893847us-gaap:OtherDebtSecuritiesMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2021-03-310000893847us-gaap:OtherDebtSecuritiesMemberus-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2021-03-310000893847us-gaap:OtherDebtSecuritiesMemberus-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2021-03-310000893847us-gaap:MortgageBackedSecuritiesMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2021-03-310000893847us-gaap:MortgageBackedSecuritiesMemberus-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2021-03-310000893847us-gaap:MortgageBackedSecuritiesMemberus-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2021-03-310000893847us-gaap:EquitySecuritiesMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2021-03-310000893847us-gaap:EquitySecuritiesMemberus-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2021-03-310000893847us-gaap:EquitySecuritiesMemberus-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2021-03-310000893847hwbk:USGovernmentAndFederalAgencyObligationsMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2021-03-310000893847hwbk:USGovernmentAndFederalAgencyObligationsMemberus-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2021-03-310000893847hwbk:USGovernmentAndFederalAgencyObligationsMemberus-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2021-03-310000893847hwbk:BankIssuedTrustPreferredSecuritiesMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2021-03-310000893847hwbk:BankIssuedTrustPreferredSecuritiesMemberus-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2021-03-310000893847hwbk:BankIssuedTrustPreferredSecuritiesMemberus-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2021-03-310000893847us-gaap:USTreasurySecuritiesMemberus-gaap:FairValueMeasurementsRecurringMember2021-03-310000893847us-gaap:USStatesAndPoliticalSubdivisionsMemberus-gaap:FairValueMeasurementsRecurringMember2021-03-310000893847us-gaap:USGovernmentSponsoredEnterprisesDebtSecuritiesMemberus-gaap:FairValueMeasurementsRecurringMember2021-03-310000893847us-gaap:OtherDebtSecuritiesMemberus-gaap:FairValueMeasurementsRecurringMember2021-03-310000893847us-gaap:MortgageBackedSecuritiesMemberus-gaap:FairValueMeasurementsRecurringMember2021-03-310000893847us-gaap:EquitySecuritiesMemberus-gaap:FairValueMeasurementsRecurringMember2021-03-310000893847hwbk:USGovernmentAndFederalAgencyObligationsMemberus-gaap:FairValueMeasurementsRecurringMember2021-03-310000893847hwbk:BankIssuedTrustPreferredSecuritiesMemberus-gaap:FairValueMeasurementsRecurringMember2021-03-310000893847us-gaap:USTreasurySecuritiesMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2020-12-310000893847us-gaap:USTreasurySecuritiesMemberus-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2020-12-310000893847us-gaap:USTreasurySecuritiesMemberus-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2020-12-310000893847us-gaap:USStatesAndPoliticalSubdivisionsMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2020-12-310000893847us-gaap:USStatesAndPoliticalSubdivisionsMemberus-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2020-12-310000893847us-gaap:USStatesAndPoliticalSubdivisionsMemberus-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2020-12-310000893847us-gaap:USGovernmentSponsoredEnterprisesDebtSecuritiesMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2020-12-310000893847us-gaap:USGovernmentSponsoredEnterprisesDebtSecuritiesMemberus-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2020-12-310000893847us-gaap:USGovernmentSponsoredEnterprisesDebtSecuritiesMemberus-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2020-12-310000893847us-gaap:OtherDebtSecuritiesMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2020-12-310000893847us-gaap:OtherDebtSecuritiesMemberus-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2020-12-310000893847us-gaap:OtherDebtSecuritiesMemberus-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2020-12-310000893847us-gaap:MortgageBackedSecuritiesMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2020-12-310000893847us-gaap:MortgageBackedSecuritiesMemberus-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2020-12-310000893847us-gaap:MortgageBackedSecuritiesMemberus-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2020-12-310000893847us-gaap:EquitySecuritiesMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2020-12-310000893847us-gaap:EquitySecuritiesMemberus-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2020-12-310000893847us-gaap:EquitySecuritiesMemberus-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2020-12-310000893847hwbk:USGovernmentAndFederalAgencyObligationsMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2020-12-310000893847hwbk:USGovernmentAndFederalAgencyObligationsMemberus-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2020-12-310000893847hwbk:USGovernmentAndFederalAgencyObligationsMemberus-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2020-12-310000893847hwbk:BankIssuedTrustPreferredSecuritiesMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2020-12-310000893847hwbk:BankIssuedTrustPreferredSecuritiesMemberus-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2020-12-310000893847hwbk:BankIssuedTrustPreferredSecuritiesMemberus-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2020-12-310000893847us-gaap:USTreasurySecuritiesMemberus-gaap:FairValueMeasurementsRecurringMember2020-12-310000893847us-gaap:USStatesAndPoliticalSubdivisionsMemberus-gaap:FairValueMeasurementsRecurringMember2020-12-310000893847us-gaap:USGovernmentSponsoredEnterprisesDebtSecuritiesMemberus-gaap:FairValueMeasurementsRecurringMember2020-12-310000893847us-gaap:OtherDebtSecuritiesMemberus-gaap:FairValueMeasurementsRecurringMember2020-12-310000893847us-gaap:MortgageBackedSecuritiesMemberus-gaap:FairValueMeasurementsRecurringMember2020-12-310000893847us-gaap:EquitySecuritiesMemberus-gaap:FairValueMeasurementsRecurringMember2020-12-310000893847hwbk:USGovernmentAndFederalAgencyObligationsMemberus-gaap:FairValueMeasurementsRecurringMember2020-12-310000893847hwbk:BankIssuedTrustPreferredSecuritiesMemberus-gaap:FairValueMeasurementsRecurringMember2020-12-310000893847us-gaap:USTreasurySecuritiesMember2021-03-310000893847us-gaap:USStatesAndPoliticalSubdivisionsMember2021-03-310000893847us-gaap:USGovernmentSponsoredEnterprisesDebtSecuritiesMember2021-03-310000893847us-gaap:OtherDebtSecuritiesMember2021-03-310000893847us-gaap:MortgageBackedSecuritiesMember2021-03-310000893847hwbk:USGovernmentAndFederalAgencyObligationsMember2021-03-310000893847hwbk:BankIssuedTrustPreferredSecuritiesMember2021-03-310000893847us-gaap:USTreasurySecuritiesMember2020-12-310000893847us-gaap:USStatesAndPoliticalSubdivisionsMember2020-12-310000893847us-gaap:USGovernmentSponsoredEnterprisesDebtSecuritiesMember2020-12-310000893847us-gaap:OtherDebtSecuritiesMember2020-12-310000893847us-gaap:MortgageBackedSecuritiesMember2020-12-310000893847hwbk:USGovernmentAndFederalAgencyObligationsMember2020-12-310000893847hwbk:BankIssuedTrustPreferredSecuritiesMember2020-12-310000893847us-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2021-03-310000893847us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2021-03-310000893847us-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2021-03-310000893847us-gaap:FairValueMeasurementsRecurringMember2021-03-310000893847us-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2020-12-310000893847us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2020-12-310000893847us-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2020-12-310000893847us-gaap:FairValueMeasurementsRecurringMember2020-12-310000893847us-gaap:EmployeeStockOptionMember2021-01-012021-03-310000893847hwbk:ResidentialRealEstatePortfolioSegmentMemberus-gaap:MortgagesMember2021-01-012021-03-310000893847hwbk:ResidentialRealEstatePortfolioSegmentMemberus-gaap:ConstructionLoansMember2021-01-012021-03-310000893847us-gaap:CommercialRealEstatePortfolioSegmentMemberus-gaap:MortgagesMember2021-01-012021-03-310000893847hwbk:InstallmentAndOtherConsumerPortfolioSegmentMember2021-01-012021-03-310000893847hwbk:CommercialFinancialAndAgriculturalPortfolioSegmentMember2021-01-012021-03-310000893847us-gaap:CommercialRealEstatePortfolioSegmentMemberus-gaap:MortgagesMember2020-01-012020-03-310000893847hwbk:ResidentialRealEstatePortfolioSegmentMemberus-gaap:MortgagesMember2020-01-012020-03-310000893847hwbk:InstallmentAndOtherConsumerPortfolioSegmentMember2020-01-012020-03-310000893847hwbk:CommercialFinancialAndAgriculturalPortfolioSegmentMember2020-01-012020-03-310000893847us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-03-310000893847us-gaap:AccumulatedNetUnrealizedInvestmentGainLossMember2021-03-310000893847us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember2021-03-310000893847us-gaap:AccumulatedOtherComprehensiveIncomeMember2020-12-310000893847us-gaap:AccumulatedNetUnrealizedInvestmentGainLossMember2020-12-310000893847us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember2020-12-310000893847us-gaap:AccumulatedOtherComprehensiveIncomeMember2020-03-310000893847us-gaap:AccumulatedNetUnrealizedInvestmentGainLossMember2020-03-310000893847us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember2020-03-310000893847us-gaap:AccumulatedOtherComprehensiveIncomeMember2019-12-310000893847us-gaap:AccumulatedNetUnrealizedInvestmentGainLossMember2019-12-310000893847us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember2019-12-3100008938472020-03-310000893847hwbk:RepurchaseProgramMember2021-01-012021-03-310000893847us-gaap:ServicingContractsMember2021-01-012021-03-310000893847us-gaap:ServicingContractsMember2020-01-012020-03-310000893847srt:MinimumMember2021-01-012021-03-310000893847srt:MaximumMember2021-01-012021-03-310000893847hwbk:CommercialFinancialAndAgriculturalPortfolioSegmentMember2021-03-310000893847hwbk:CommercialFinancialAndAgriculturalPortfolioSegmentMember2020-12-310000893847us-gaap:ChangeDuringPeriodFairValueDisclosureMemberus-gaap:FairValueMeasurementsNonrecurringMember2021-03-310000893847us-gaap:ChangeDuringPeriodFairValueDisclosureMemberus-gaap:FairValueMeasurementsNonrecurringMember2020-03-310000893847us-gaap:ServicingContractsMember2021-03-310000893847us-gaap:ServicingContractsMember2020-12-310000893847us-gaap:ServicingContractsMember2020-03-310000893847us-gaap:ConstructionMemberhwbk:LoanModificationCaresActMember2021-03-310000893847hwbk:RealEstateAndRentalAndLeasingMemberhwbk:LoanModificationCaresActMember2021-03-310000893847hwbk:NonNaicsConsumerMemberhwbk:LoanModificationCaresActMember2021-03-310000893847hwbk:LandAndLotsMemberhwbk:LoanModificationCaresActMember2021-03-310000893847hwbk:CinemasMemberhwbk:LoanModificationCaresActMember2021-03-310000893847hwbk:ArtsEntertainmentRecreationMemberhwbk:LoanModificationCaresActMember2021-03-310000893847hwbk:AccommodationsAndFoodServicesMemberhwbk:LoanModificationCaresActMember2021-03-310000893847us-gaap:ConstructionMemberhwbk:InterestOnlyPaymentModificationMemberhwbk:LoanModificationCaresActMember2021-03-310000893847hwbk:RealEstateAndRentalAndLeasingMemberus-gaap:ExtendedMaturityMemberhwbk:LoanModificationCaresActMember2021-03-310000893847hwbk:RealEstateAndRentalAndLeasingMemberhwbk:InterestOnlyPaymentModificationMemberhwbk:LoanModificationCaresActMember2021-03-310000893847hwbk:RealEstateAndRentalAndLeasingMemberhwbk:FullDeferralPaymentModificationMemberhwbk:LoanModificationCaresActMember2021-03-310000893847hwbk:NonNaicsConsumerMemberhwbk:InterestOnlyPaymentModificationMemberhwbk:LoanModificationCaresActMember2021-03-310000893847hwbk:NonNaicsConsumerMemberhwbk:FullDeferralPaymentModificationMemberhwbk:LoanModificationCaresActMember2021-03-310000893847hwbk:LandAndLotsMemberhwbk:InterestOnlyPaymentModificationMemberhwbk:LoanModificationCaresActMember2021-03-310000893847hwbk:CinemasMemberhwbk:InterestOnlyPaymentModificationMemberhwbk:LoanModificationCaresActMember2021-03-310000893847hwbk:CinemasMemberhwbk:FullDeferralPaymentModificationMemberhwbk:LoanModificationCaresActMember2021-03-310000893847hwbk:ArtsEntertainmentRecreationMemberhwbk:InterestOnlyPaymentModificationMemberhwbk:LoanModificationCaresActMember2021-03-310000893847hwbk:AccommodationsAndFoodServicesMemberus-gaap:ExtendedMaturityMemberhwbk:LoanModificationCaresActMember2021-03-310000893847hwbk:AccommodationsAndFoodServicesMemberhwbk:InterestOnlyPaymentModificationMemberhwbk:LoanModificationCaresActMember2021-03-310000893847hwbk:AccommodationsAndFoodServicesMemberhwbk:FullDeferralPaymentModificationMemberhwbk:LoanModificationCaresActMember2021-03-310000893847us-gaap:ExtendedMaturityMemberhwbk:LoanModificationCaresActMember2021-03-310000893847hwbk:InterestOnlyPaymentModificationMemberhwbk:LoanModificationCaresActMember2021-03-310000893847hwbk:FullDeferralPaymentModificationMemberhwbk:LoanModificationCaresActMember2021-03-310000893847us-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CommercialRealEstatePortfolioSegmentMemberus-gaap:MortgagesMember2021-03-310000893847us-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsNonrecurringMemberhwbk:ResidentialRealEstatePortfolioSegmentMemberus-gaap:MortgagesMember2021-03-310000893847us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CommercialRealEstatePortfolioSegmentMemberus-gaap:MortgagesMember2021-03-310000893847us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsNonrecurringMemberhwbk:ResidentialRealEstatePortfolioSegmentMemberus-gaap:MortgagesMember2021-03-310000893847us-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CommercialRealEstatePortfolioSegmentMemberus-gaap:MortgagesMember2021-03-310000893847us-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsNonrecurringMemberhwbk:ResidentialRealEstatePortfolioSegmentMemberus-gaap:MortgagesMember2021-03-310000893847us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CommercialRealEstatePortfolioSegmentMemberus-gaap:MortgagesMember2021-03-310000893847us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsNonrecurringMemberhwbk:ResidentialRealEstatePortfolioSegmentMemberus-gaap:MortgagesMember2021-03-310000893847us-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsNonrecurringMemberhwbk:CommercialFinancialAndAgriculturalPortfolioSegmentMember2021-03-310000893847us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsNonrecurringMemberhwbk:CommercialFinancialAndAgriculturalPortfolioSegmentMember2021-03-310000893847us-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsNonrecurringMemberhwbk:CommercialFinancialAndAgriculturalPortfolioSegmentMember2021-03-310000893847us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsNonrecurringMemberhwbk:CommercialFinancialAndAgriculturalPortfolioSegmentMember2021-03-310000893847us-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsNonrecurringMember2021-03-310000893847us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsNonrecurringMember2021-03-310000893847us-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsNonrecurringMember2021-03-310000893847us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsNonrecurringMember2021-03-310000893847us-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CommercialRealEstatePortfolioSegmentMemberus-gaap:MortgagesMember2020-03-310000893847us-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CommercialRealEstatePortfolioSegmentMemberus-gaap:ConstructionLoansMember2020-03-310000893847us-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsNonrecurringMemberhwbk:ResidentialRealEstatePortfolioSegmentMemberus-gaap:MortgagesMember2020-03-310000893847us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CommercialRealEstatePortfolioSegmentMemberus-gaap:MortgagesMember2020-03-310000893847us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CommercialRealEstatePortfolioSegmentMemberus-gaap:ConstructionLoansMember2020-03-310000893847us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsNonrecurringMemberhwbk:ResidentialRealEstatePortfolioSegmentMemberus-gaap:MortgagesMember2020-03-310000893847us-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CommercialRealEstatePortfolioSegmentMemberus-gaap:MortgagesMember2020-03-310000893847us-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CommercialRealEstatePortfolioSegmentMemberus-gaap:ConstructionLoansMember2020-03-310000893847us-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsNonrecurringMemberhwbk:ResidentialRealEstatePortfolioSegmentMemberus-gaap:MortgagesMember2020-03-310000893847us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CommercialRealEstatePortfolioSegmentMemberus-gaap:MortgagesMember2020-03-310000893847us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CommercialRealEstatePortfolioSegmentMemberus-gaap:ConstructionLoansMember2020-03-310000893847us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsNonrecurringMemberhwbk:ResidentialRealEstatePortfolioSegmentMemberus-gaap:MortgagesMember2020-03-310000893847us-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsNonrecurringMemberhwbk:InstallmentAndOtherConsumerPortfolioSegmentMember2020-03-310000893847us-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsNonrecurringMemberhwbk:CommercialFinancialAndAgriculturalPortfolioSegmentMember2020-03-310000893847us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsNonrecurringMemberhwbk:InstallmentAndOtherConsumerPortfolioSegmentMember2020-03-310000893847us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsNonrecurringMemberhwbk:CommercialFinancialAndAgriculturalPortfolioSegmentMember2020-03-310000893847us-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsNonrecurringMemberhwbk:InstallmentAndOtherConsumerPortfolioSegmentMember2020-03-310000893847us-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsNonrecurringMemberhwbk:CommercialFinancialAndAgriculturalPortfolioSegmentMember2020-03-310000893847us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsNonrecurringMemberhwbk:InstallmentAndOtherConsumerPortfolioSegmentMember2020-03-310000893847us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsNonrecurringMemberhwbk:CommercialFinancialAndAgriculturalPortfolioSegmentMember2020-03-310000893847us-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsNonrecurringMember2020-03-310000893847us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsNonrecurringMember2020-03-310000893847us-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsNonrecurringMember2020-03-310000893847us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsNonrecurringMember2020-03-310000893847hwbk:CollateralDependentImpairedLoansMember2021-01-012021-03-310000893847hwbk:CollateralDependentImpairedLoansMember2020-01-012020-03-310000893847us-gaap:ChangeDuringPeriodFairValueDisclosureMemberus-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CommercialRealEstatePortfolioSegmentMemberus-gaap:MortgagesMember2021-01-012021-03-310000893847us-gaap:ChangeDuringPeriodFairValueDisclosureMemberus-gaap:FairValueMeasurementsNonrecurringMember2021-01-012021-03-310000893847us-gaap:ChangeDuringPeriodFairValueDisclosureMemberus-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CommercialRealEstatePortfolioSegmentMemberus-gaap:MortgagesMember2020-01-012020-03-310000893847us-gaap:ChangeDuringPeriodFairValueDisclosureMemberus-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CommercialRealEstatePortfolioSegmentMemberus-gaap:ConstructionLoansMember2020-01-012020-03-310000893847us-gaap:ChangeDuringPeriodFairValueDisclosureMemberus-gaap:FairValueMeasurementsNonrecurringMemberhwbk:ResidentialRealEstatePortfolioSegmentMemberus-gaap:MortgagesMember2020-01-012020-03-310000893847us-gaap:ChangeDuringPeriodFairValueDisclosureMemberus-gaap:FairValueMeasurementsNonrecurringMemberhwbk:InstallmentAndOtherConsumerPortfolioSegmentMember2020-01-012020-03-310000893847us-gaap:ChangeDuringPeriodFairValueDisclosureMemberus-gaap:FairValueMeasurementsNonrecurringMember2020-01-012020-03-3100008938472020-01-012020-03-310000893847hwbk:LoanModificationCaresActMember2021-03-310000893847us-gaap:FairValueInputsLevel3Member2021-03-310000893847us-gaap:FairValueInputsLevel2Member2021-03-310000893847us-gaap:FairValueInputsLevel1Member2021-03-310000893847us-gaap:EstimateOfFairValueFairValueDisclosureMember2021-03-310000893847us-gaap:CarryingReportedAmountFairValueDisclosureMember2021-03-3100008938472021-03-310000893847us-gaap:FairValueInputsLevel3Member2020-12-310000893847us-gaap:FairValueInputsLevel2Member2020-12-310000893847us-gaap:FairValueInputsLevel1Member2020-12-310000893847us-gaap:EstimateOfFairValueFairValueDisclosureMember2020-12-310000893847us-gaap:CarryingReportedAmountFairValueDisclosureMember2020-12-3100008938472020-12-3100008938472020-07-012020-07-0100008938472021-05-1000008938472021-01-012021-03-31xbrli:sharesxbrli:pureiso4217:USDhwbk:securityiso4217:USDxbrli:shareshwbk:contract

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

   Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended March 31, 2021

OR

   Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from ______________ to ______________

Commission file number: 0-23636

HAWTHORN BANCSHARES, INC.

(Exact name of registrant as specified in its charter)

Missouri

43-1626350

(State or other jurisdiction of

(I.R.S. Employer Identification No.)

incorporation or organization)

 

132 East High Street, Box 688, Jefferson City, Missouri 65102

(Address of principal executive offices) (Zip Code)

(573) 761-6100

(Registrant’s telephone number, including area code)

N/A

(Former name, former address and former fiscal year, if changed since last report.)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common Stock, $1.00 par value

HWBK

The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer”, “accelerated filer”, “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer

Accelerated filer

Non-accelerated filer

Smaller reporting company

Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes No

As of May 10, 2021, the registrant had 6,362,476 shares of common stock, par value $1.00 per share, outstanding.

PART I – FINANCIAL INFORMATION

Item 1. Financial Statements

HAWTHORN BANCSHARES, INC. AND SUBSIDIARIES

Consolidated Balance Sheets

March 31, 

December 31, 

(In thousands, except per share data)

    

2021

    

2020

    

(Unaudited)

    

ASSETS

Cash and due from banks

$

18,496

$

19,235

Federal funds sold and other interest-bearing deposits

 

128,207

 

161,128

Cash and cash equivalents

 

146,703

 

180,363

Certificates of deposit in other banks

 

8,897

 

9,376

Available-for-sale debt securities, at fair value

 

238,142

 

198,030

Other investments

 

6,188

 

6,353

Total investment securities

 

244,330

 

204,383

Loans held for investment

 

1,276,185

 

1,286,967

Allowance for loan losses

 

(18,361)

 

(18,113)

Net loans

 

1,257,824

 

1,268,854

Loans held for sale, at lower of cost or fair value

6,308

5,099

Premises and equipment - net

 

34,027

 

34,561

Mortgage servicing rights, at fair value

 

2,494

 

2,445

Other real estate owned - net

 

12,140

 

12,291

Accrued interest receivable

 

6,488

 

6,640

Cash surrender value - life insurance

 

2,465

 

2,451

Other assets

 

10,248

 

7,268

Total assets

$

1,731,924

$

1,733,731

LIABILITIES AND STOCKHOLDERS' EQUITY

Deposits

Non-interest bearing demand

$

431,035

$

382,492

Savings, interest checking and money market

 

708,615

 

723,808

Time deposits $250,000 and over

 

74,406

 

91,263

Other time deposits

 

179,926

 

186,043

Total deposits

 

1,393,982

 

1,383,606

Federal funds purchased and securities sold under agreements to repurchase

 

42,018

 

45,154

Federal Home Loan Bank advances and other borrowings

 

97,614

 

106,674

Subordinated notes

 

49,486

 

49,486

Operating lease liabilities

2,058

2,137

Accrued interest payable

 

439

 

837

Other liabilities

 

15,619

 

15,248

Total liabilities

 

1,601,216

 

1,603,142

Stockholders’ equity:

Common stock, $1 par value, authorized 15,000,000 shares; issued 6,769,322

 

6,769

 

6,769

Surplus

 

59,307

 

59,307

Retained earnings

 

73,947

 

68,935

Accumulated other comprehensive income (loss), net of tax

 

(1,217)

 

1,528

Treasury stock; 406,846, and 289,214 shares, at cost, respectively

 

(8,098)

 

(5,950)

Total stockholders’ equity

 

130,708

 

130,589

Total liabilities and stockholders’ equity

$

1,731,924

$

1,733,731

See accompanying notes to the consolidated financial statements (unaudited).

2

HAWTHORN BANCSHARES, INC. AND SUBSIDIARIES

Consolidated Statements of Income (unaudited)

Three Months Ended

 

March 31, 

(In thousands, except per share amounts)

    

2021

    

2020

INTEREST INCOME

  

  

Interest and fees on loans

$

14,979

$

14,422

Interest and fees on loans held for sale

25

5

Interest on investment securities:

 

  

 

  

Taxable

 

667

 

813

Nontaxable

 

246

 

142

Federal funds sold, other interest-bearing deposits, and certificates of deposit in other banks

 

102

 

326

Dividends on other investments

 

83

 

100

Total interest income

 

16,102

 

15,808

INTEREST EXPENSE

 

  

 

  

Interest on deposits:

 

  

 

  

Savings, interest checking and money market

 

309

 

947

Time deposit accounts $250,000 and over

 

210

 

413

Time deposits

461

752

Total interest expense on deposits

980

2,112

Interest on federal funds purchased and securities sold under agreements to repurchase

 

26

 

37

Interest on Federal Home Loan Bank advances

 

396

 

632

Interest on subordinated notes

 

310

 

501

Total interest expense on borrowings

732

1,170

Total interest expense

 

1,712

 

3,282

Net interest income

 

14,390

 

12,526

Provision for loan losses

 

 

3,300

Net interest income after provision for loan losses

 

14,390

 

9,226

NON-INTEREST INCOME

 

  

 

  

Service charges and other fees

 

739

 

799

Bank card income and fees

 

860

 

693

Trust department income

 

294

 

379

Real estate servicing fees, net

 

73

 

(87)

Gain on sale of mortgage loans, net

 

2,469

 

419

Other

 

8

 

88

Total non-interest income

 

4,443

 

2,291

Investment securities gains (losses), net

 

14

 

(1)

NON-INTEREST EXPENSE

 

  

 

  

Salaries and employee benefits

 

7,146

 

6,121

Occupancy expense, net

 

771

 

766

Furniture and equipment expense

 

744

 

750

Processing, network, and bank card expense

 

1,007

 

976

Legal, examination, and professional fees

 

404

 

367

Advertising and promotion

 

243

 

249

Postage, printing, and supplies

 

204

 

241

Loan expense

 

174

 

123

Other

 

958

 

898

Total non-interest expense

 

11,651

 

10,491

Income before income taxes

 

7,196

 

1,025

Income tax expense

 

1,357

 

157

Net income

$

5,839

$

868

Basic earnings per share

$

0.92

$

0.13

Diluted earnings per share

$

0.92

$

0.13

See accompanying notes to the consolidated financial statements (unaudited).

3

HAWTHORN BANCSHARES, INC. AND SUBSIDIARIES

Consolidated Statements of Comprehensive Income (unaudited)

Three Months Ended

 

March 31, 

(In thousands)

    

2021

    

2020

Net income

$

5,839

$

868

Other comprehensive income, net of tax

 

  

 

  

Investment securities available-for-sale:

Unrealized (losses) gains on investment securities available-for-sale, net of tax

 

(2,778)

 

2,180

Adjustment for (gains) losses on sale of investment securities, net of tax

 

(2)

 

Defined benefit pension plans:

 

  

 

  

Amortization of prior service cost included in net periodic pension cost, net of tax

 

35

 

53

Total other comprehensive income (loss)

 

(2,745)

 

2,233

Total comprehensive income

$

3,094

$

3,101

See accompanying notes to the consolidated financial statements (unaudited).

4

HAWTHORN BANCSHARES, INC. AND SUBSIDIARIES

Consolidated Statements of Stockholders’ Equity (unaudited)

For the Three Months Ended March 31, 2021 and 2020

    

    

    

    

Accumulated

    

    

Total

 

Other

 

Stock -

 

Common

 

Retained

 

Comprehensive

 

Treasury

 

holders'

(In thousands)

 

Stock

 

Surplus

 

Earnings

 

Income (Loss)

 

Stock

 

Equity

Balance, December 31, 2020

$

6,769

$

59,307

$

68,935

$

1,528

$

(5,950)

$

130,589

Net income

 

 

 

5,839

 

 

 

5,839

Other comprehensive loss

 

 

 

 

(2,745)

 

 

(2,745)

Purchase of treasury stock

 

 

 

 

 

(2,148)

 

(2,148)

Cash dividends declared, common stock ($0.13 per share)

 

 

 

(827)

 

 

 

(827)

Balance, March 31, 2021

$

6,769

$

59,307

$

73,947

$

(1,217)

$

(8,098)

$

130,708

Balance, December 31, 2019

$

6,520

$

55,727

$

61,590

$

(3,755)

$

(5,044)

$

115,038

Net income

 

 

 

868

 

 

 

868

Other comprehensive income

 

 

 

 

2,233

 

 

2,233

Purchase of treasury stock

 

 

 

 

 

(719)

 

(719)

Cash dividends declared, common stock ($0.12 per share)

 

 

 

(750)

 

 

 

(750)

Balance, March 31, 2020

$

6,520

$

55,727

$

61,708

$

(1,522)

$

(5,763)

$

116,670

See accompanying notes to the consolidated financial statements (unaudited).

5

HAWTHORN BANCSHARES, INC. AND SUBSIDIARIES

Consolidated Statements of Cash Flows (unaudited)

Three Months Ended March 31, 

(In thousands)

    

2021

    

2020

Cash flows from operating activities:

Net income

$

5,839

$

868

Adjustments to reconcile net income to net cash provided by operating activities:

Provision for loan losses

 

 

3,300

Depreciation expense

 

578

 

562

Net amortization of investment securities, premiums, and discounts

 

418

 

312

Change in fair value of mortgage servicing rights

 

121

 

275

Investment securities (gains) losses, net

 

(14)

 

1

Losses (gains) on sales and dispositions of premises and equipment

 

4

(55)

Gain on sales and dispositions of other real estate

 

(15)

 

Provision for other real estate owned

 

88

 

12

Decrease in accrued interest receivable

 

152

 

218

Increase in cash surrender value - life insurance

 

(14)

 

(13)

Increase in other assets

 

(1,756)

(312)

Operating lease liabilities

(79)

(62)

Decrease in accrued interest payable

 

(398)

 

(356)

Increase (decrease) in other liabilities

 

12

 

(1,367)

Origination of mortgage loans held for sale

 

(65,012)

 

(16,609)

Proceeds from the sale of mortgage loans held for sale

 

66,272

 

13,170

Gain on sale of mortgage loans, net

 

(2,469)

(419)

Other, net

 

(170)

 

(67)

Net cash provided by (used in) operating activities

 

3,557

 

(542)

Cash flows from investing activities:

Purchase of certificates of deposit in other banks

 

(245)

 

(735)

Proceeds from maturities of certificates of deposit in other banks

 

736

 

491

Net decrease (increase) in loans

 

11,000

 

(11,809)

Purchase of available-for-sale debt securities

 

(62,297)

 

(43,984)

Proceeds from maturities of available-for-sale debt securities

 

10,491

 

13,860

Proceeds from calls of available-for-sale debt securities

 

7,745

 

8,935

Proceeds from sales of available-for-sale debt securities

 

 

681

Purchases of FHLB stock

 

(327)

 

(1,491)

Proceeds from sales of FHLB stock

 

505

 

2

Purchases of premises and equipment

 

(135)

 

(369)

Proceeds from sales of premises and equipment

 

12

 

123

Proceeds from sales of other real estate and repossessed assets

 

108

 

Net cash used in investing activities

 

(32,407)

 

(34,296)

Cash flows from financing activities:

Net increase in demand deposits

 

48,543

 

11,412

Net decrease in interest-bearing transaction accounts

 

(15,193)

 

(18,037)

Net decrease in time deposits

 

(22,974)

(325)

Net (decrease) increase in federal funds purchased and securities sold under agreements to repurchase

 

(3,136)

 

3,492

Repayment of FHLB advances and other borrowings

 

(9,060)

 

(58)

FHLB advances

 

 

37,000

Purchase of treasury stock

 

(2,148)

 

(719)

Cash dividends paid - common stock

 

(842)

 

(753)

Net cash (used in) provided by financing activities

 

(4,810)

 

32,012

Net decrease in cash and cash equivalents

 

(33,660)

 

(2,826)

Cash and cash equivalents, beginning of period

 

180,363

 

78,121

Cash and cash equivalents, end of period

$

146,703

$

75,295

Supplemental disclosures of cash flow information:

Cash paid during the period for:

Interest

$

2,109

$

3,639

Income taxes

$

$

Noncash investing and financing activities:

Other real estate and repossessed assets acquired in settlement of loans

$

30

$

See accompanying notes to the consolidated financial statements (unaudited).

6

HAWTHORN BANCSHARES, INC.

AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Unaudited)

(1)   Summary of Significant Accounting Policies

Hawthorn Bancshares, Inc. (the Company) through its subsidiary, Hawthorn Bank (the Bank), provides a broad range of banking services to individual and corporate customers located within the Missouri communities in and surrounding Jefferson City, Columbia, Clinton, Warsaw, Springfield, St. Louis, and the greater Kansas City metropolitan area. The Company is subject to competition from other financial and nonfinancial institutions providing financial products. Additionally, the Company and its subsidiaries are subject to the regulations of certain regulatory agencies and undergo periodic examinations by those regulatory agencies.

The accompanying unaudited consolidated financial statements of the Company have been prepared in conformity with U.S. generally accepted accounting principles (U.S. GAAP) for interim financial information and with the instructions to Form 10-Q, and Rule 10-01 of Regulation S-X. Accordingly, the unaudited consolidated financial statements do not include all of the information and disclosures required by U.S. GAAP for complete financial statements and should be read in conjunction with the consolidated financial statements and related notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020.

The preparation of the consolidated financial statements includes all adjustments that, in the opinion of management, are necessary in order to make those statements not misleading. Management is required to make estimates and assumptions, including the determination of the allowance for loan losses, real estate acquired in connection with foreclosure or in satisfaction of loans, and fair values of investment securities available-for-sale 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 are subject to many risks and uncertainties, including changes in interest rates and other general economic, business and political conditions, including the effects of the Coronavirus Disease 2019 (“COVID-19”) pandemic, including its potential effects on the economic environment, our customers and our operations, as well as any changes to federal, state and local government laws, regulations and orders in connection with the pandemic. Actual results could differ from those estimates. The Company’s management has evaluated and did not identify any subsequent events or transactions requiring recognition or disclosure in the consolidated financial statements.

Stock Dividend On July 1, 2020, the Company paid a special stock dividend of four percent to shareholders of record at the close of business on June 15, 2020. For all periods presented, share information, including basic and diluted earnings per share, has been adjusted retroactively to reflect this change.

Operating, Accounting and Reporting Considerations related to COVID-19

The COVID-19 pandemic has negatively impacted the global economy, including the United States. In response to this crisis, the Coronavirus Aid, Relief, and Economic Security (“CARES”) Act was passed by Congress and signed into law on March 27, 2020. The CARES Act, along with subsequent relief programs, provided substantial funding to fight the COVID-19 pandemic and stimulate the economy by supporting individuals and businesses through loans, grants, tax changes, and other types of relief. Some of the provisions applicable to the Company include, but are not limited to:

Accounting for Loan Modifications – Section 4013 of the CARES Act provides that a financial institution may elect to suspend (1) the requirements under GAAP for certain loan modifications that would otherwise be categorized as a TDR and (2) any determination that such loan modifications would be considered a TDR, including the related impairment for accounting purposes.  See Note 2 Loans and Leases and the Allowance for Credit Losses for more information.

7

HAWTHORN BANCSHARES, INC.

AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Unaudited)

Paycheck Protection Program - The CARES Act established the Paycheck Protection Program (“PPP”), an expansion of the Small Business Administration’s (“SBA”) 7(a) loan program and the Economic Injury Disaster Loan Program (“EIDL”), administered directly by the SBA. On December 27, 2020, the Consolidated Appropriations Act, 2021 (“CAA”) was signed into law. The CAA provides several amendments to the PPP, including additional funding for first and second draws of PPP loans up to March 31, 2021. On March 30, 2021, the PPP Extension Act of 2021 was signed into law, which extends the program to May 31, 2021. The Company is a participant in the PPP.  See Note 2 Loans and Leases and the Allowance for Credit Losses for more information.

Also in response to the COVID-19 pandemic, the Board of Governors of the Federal Reserve System (“FRB”), the Federal Deposit Insurance Corporation (“FDIC”), the National Credit Union Administration (“NCUA”), the Office of the Comptroller of the Currency (“OCC”), and the Consumer Financial Protection Bureau (“CFPB”), in consultation with the state financial regulators (collectively, the “agencies”) issued a joint interagency statement (issued March 22, 2020; revised statement issued April 7, 2020).  Some of the provisions applicable to the Company include, but are not limited to:

Accounting for Loan Modifications - Loan modifications that do not meet the conditions of the CARES Act may still qualify as a modification that does not need to be accounted for as a TDR. The agencies confirmed with FASB staff that short-term modifications made on a good faith basis in response to COVID-19 to borrowers who were current prior to any relief are not TDRs. This includes short-term modifications such as payment deferrals, fee waivers, extensions of repayment terms, or insignificant delays in payment.  See Note 2 Loans and Leases and the Allowance for Credit Losses for more information.
Past Due Reporting - With regard to loans not otherwise reportable as past due, financial institutions are not expected to designate loans with deferrals granted due to COVID-19 as past due because of the deferral. A loan’s payment date is governed by the due date stipulated in the legal agreement. If a financial institution agrees to a payment deferral, these loans would not be considered past due during the period of the deferral.
Nonaccrual Status and Charge-offs - During short-term COVID-19 modifications, these loans generally should not be reported as nonaccrual or as classified.

The Company began offering short-term loan modifications to assist borrowers during the COVID-19 pandemic. These modifications generally involve principal and/or interest payment deferrals for up to six months. These modifications generally meet the criteria of both Section 4013 of the CARES Act and the joint interagency statement, and therefore, the Company does not account for such loan modifications as TDRs. As the COVID-19 pandemic persists in negatively impacting the economy, the Company continues to offer additional loan modifications to borrowers struggling as a result of the pandemic. Similar to the initial modifications granted, the additional round of loan modifications are granted specifically under Section 4013 of the CARES Act and generally involve principal and/or interest payment deferrals for up to an additional six months for commercial and consumer loans, and principal-only deferrals for up to an additional 12 months for selected commercial loans. On August 3, 2020, the Federal Financial Institutions Examination Council on behalf of its members (collectively “the FFIEC members”) issued a joint statement on additional loan accommodations related to the COVID-19 pandemic. The joint statement clarifies that for loan modifications in which Section 4013 is being applied, subsequent modifications could also be eligible under Section 4013. To be eligible, each loan modification must be (1) related to the COVID-19 event; (2) executed on a loan that was not more than 30 days past due as of December 31, 2019; and (3) executed between March 1, 2020, and the earlier of (A) 60 days after the date of termination of the National Emergency or (B) December 31, 2020. The December 31, 2020 deadline was subsequently extended to January 1, 2022, by the CAA.  Substantially all of the Company’s additional round of loan modifications granted under Section 4013 of the CARES Act are in compliance with the aforementioned FFIEC requirements. Accordingly, the Company does not account for such loan modifications as TDRs.

8

HAWTHORN BANCSHARES, INC.

AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Unaudited)

(2)   Loans and Allowance for Loan Losses

Loans

Major classifications within the Company’s held for investment loan portfolio at March 31, 2021 and December 31, 2020 is as follows:

March 31, 

December 31, 

(in thousands)

    

2021

    

2020

Commercial, financial, and agricultural (a)

$

251,943

$

272,918

Real estate construction residential

 

33,962

 

29,692

Real estate construction commercial

 

78,576

 

78,144

Real estate mortgage residential

 

258,259

 

262,339

Real estate mortgage commercial

 

628,178

 

617,133

Installment and other consumer

 

25,267

 

26,741

Total loans held for investment

$

1,276,185

$

1,286,967

(a)Includes $56.3 million and $63.3 million SBA PPP loans, net as of March 31, 2021 and December 31, 2020, respectively.

The Bank grants real estate, commercial, installment, and other consumer loans to customers located within the Missouri communities surrounding Jefferson City, Columbia, Clinton, Warsaw, Springfield, St. Louis, and the greater Kansas City metropolitan area. As such, the Bank is susceptible to changes in the economic environment in these communities. The Bank does not have a concentration of credit in any one economic sector. Installment and other consumer loans consist primarily of the financing of automotive vehicles. At March 31, 2021, loans of $552.5 million were pledged to the Federal Home Loan Bank as collateral for borrowings and letters of credit.

Allowance for Loan Losses

The following table illustrates the changes in the allowance for loan losses by portfolio segment:

Three Months Ended March 31, 2021

Commercial,

Real Estate

Real Estate

Real Estate

Real Estate

Installment

 

Financial, &

Construction -

Construction -

Mortgage -

Mortgage -

and Other

Un-

 

(in thousands)

    

Agricultural

    

Residential

    

Commercial

    

Residential

    

Commercial

    

Consumer

    

allocated

    

Total

Balance at beginning of period

$

5,121

$

213

$

475

$

2,679

$

9,354

$

264

$

7

$

18,113

Additions:

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

Provision for loan losses

 

(567)

 

83

 

57

 

(253)

 

573

 

13

 

94

 

Deductions:

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

  

Loans charged off

 

27

 

 

 

 

23

 

57

 

 

107

Less recoveries on loans

 

(149)

 

(13)

 

 

(168)

 

 

(25)

 

 

(355)

Net loan charge-offs (recoveries)

 

(122)

 

(13)

 

 

(168)

 

23

 

32

 

 

(248)

Balance at end of period

$

4,676

$

309

$

532

$

2,594

$

9,904

$

245

$

101

$

18,361

9

HAWTHORN BANCSHARES, INC.

AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

(Unaudited)