DISCUSSION AND ANALYSIS OF MANAGEMENT’S FINANCIAL POSITION AND RESULTS

The following discussion and analysis of our financial condition and results of
operations should be read in conjunction with our consolidated financial
statements and related notes included elsewhere in this Quarterly Report and in
our Annual Report on Form 10-K for the year ended December 31, 2021.

Unless the context indicates otherwise, references in this management's
discussion and analysis to "we", "our", and "us," refer to Bank7 Corp. and its
consolidated subsidiaries.  All references to "the Bank" refer to Bank7, our
wholly owned subsidiary.

General

We are Bank7 Corp.a bank holding company based in Oklahoma City, Oklahoma. Through our wholly owned subsidiary Bank7we operate twelve locations in Oklahomathat Dallas/Fort Worth, Texas metropolitan area
Kansas. We are focused on serving business owners and entrepreneurs by providing fast, consistent, and well-designed loan and deposit products to meet their funding needs. We want to grow organically by opening additional branches in our target markets and pursuing strategic acquisitions.

As a bank holding company, we generate most of our revenue from interest income
on loans and from short-term investments. The primary source of funding for our
loans and short-term investments are deposits held by our subsidiary, Bank7. We
measure our performance by our return on average assets, return on average
equity, earnings per share, capital ratios, efficiency ratio (calculated by
dividing noninterest expense by the sum of net interest income on a tax
equivalent basis) and noninterest income.

As of March 31, 2022, we had total assets of $1.4 billion, total loans of $1.1
billion, total deposits of $1.3 billion and total shareholders' equity of $128.6
million.

Results of Operations

Performance Summary. For the first quarter of 2022, we reported a pre-tax income
of $8.2 million, compared to pre-tax income of $6.8 million for the first
quarter of 2021. For the first quarter of 2022, interest income increased by
$1.7 million, or 13.2%, compared to the first quarter of 2021. For the first
quarter of 2022, average total loans were $1.0 billion with loan yields of 5.82%
as compared to average total loans of $847.5 million with loan yields of 6.27%
for the first quarter of 2021.

Our provision for loan losses for the first quarter of 2022 was $276,000compared to $1.28 million for the first quarter of 2021.

The return on average equity was 19.26% for the first quarter of 2022, compared to 19.02% for the same period in 2021.

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Net Interest Income and Net Interest Margin. The following table presents, for
the periods indicated, information about: (i) weighted average balances, the
total dollar amount of interest income from interest-earning assets, and the
resultant average yields; (ii) average balances, the total dollar amount of
interest expense on interest-bearing liabilities, and the resultant average
rates; (iii) net interest income; and (iv) the net interest margin.

                                                                            Net Interest Margin
                                                                   For the Three Months Ended March 31,
                                                              2022                                       2021
                                                             Interest       Average                    Interest       Average
                                               Average        Income/       Yield/        Average       Income/       Yield/
                                               Balance        Expense        Rate         Balance       Expense        Rate
                                                                          (Dollars in thousands)
Interest-Earning Assets:
Short-term investments                       $   187,672     $      86     

0.19% $125,739 $92 0.30% Notes, Taxable Equivalent

               87,886           364          1.68         1,172             2          0.69
Debt securities, tax exempt(1)                    23,969            98          1.66             -             -             -
Loans held for sale                                  487             -             -           378             -             -
Total loans(2)                                 1,003,890        14,377     

5.81 847,498 13,094 6.27 Total interest-bearing assets

                  1,303,904        14,925          4.64       974,787        13,188          5.49
Noninterest-earning assets                        24,342                                     7,103
Total assets                                 $ 1,328,246                                 $ 981,890

Funding sources:
Interest-bearing liabilities:
Deposits:
Transaction accounts                         $   636,446           458          0.29 %   $ 419,991           362          0.35 %
Time deposits                                    169,602           259          0.62       205,557           513          1.01
Total interest-bearing deposits                  806,048           717          0.36       625,548           875          0.57
Total interest-bearing liabilities           $   806,048           717          0.36     $ 625,548           875          0.57

Noninterest-bearing liabilities:
Noninterest-bearing deposits                 $   385,664                                 $ 243,290
Other noninterest-bearing liabilities              6,301                                     4,193
Total noninterest-bearing liabilities            391,965                                   247,483
Shareholders' equity                             130,233                                   108,859
Total liabilities and shareholders' equity   $ 1,328,246                                 $ 981,890

Net interest income                                          $  14,208                                 $  12,313
Net interest spread                                                             4.40 %                                    4.92 %
Net interest margin                                                             4.42 %                                    5.12 %


(1) Tax-equivalent rate of return deducted from 2.10% March 31, 2022Application of 21%

effective tax rate

(2) Interest-free loans from $9.5 million and $12.7 million away March 31, 2022 and

    March 31, 2021, respectively, are included in loans.



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For the first quarter of 2022 compared to the first quarter of 2021:

– Interest income from debt securities of $462,000a result of debt securities

acquired in December 2021 and purchased in the first quarter of 2022;

– Interest income summed up on all loans $14.4 millionAn increase of $1.3

million, or 9.8%, due to an increase in average loans of $156.4 millionor

18.5%, despite a decline in loan yields of 46 basis points, or 7.4%;

– Total loan fees $1.6 milliona drop from $355,000 or 17.8% based on

one-off PPP loan fee revenue decreasing and

– Net interest margin for the first quarter of 2022 was 4.42% compared to 5.12%

for the first quarter of 2021.



Increases and decreases in interest income and interest expense result from
changes in average balances, or volume, of interest-earning assets and
interest-bearing liabilities, as well as changes in average interest rates. The
following tables set forth the effects of changing rates and volumes on our net
interest income during the period shown. Information is provided with respect to
(i) effects on interest income attributable to changes in volume (change in
volume multiplied by prior rate) and (ii) effects on interest income
attributable to changes in rate (changes in rate multiplied by prior volume).

                                                      Analysis of Changes in Interest Income
                                                                   and Expenses
                                                            For the Three Months Ended
                                                              March 31, 2022 vs 2021
                                                         Change due to:
                                                  Volume(1)            Rate(1)           Interest
                                                                                         Variance
(in thousands)                                                (Dollars in thousands)
Increase (decrease) in interest income:
Short-term investments                          $         186       $        (192 )     $       (6 )
Investment securities                                     772                (312 )            460
Total loans                                             9,806              (8,523 )          1,283
Total increase (decrease) in interest income           10,764              

(9,027) 1,737

Increase (decrease) in interest expense:
Deposits:
Transaction accounts                                      758                (662 )             96
Time deposits                                            (363 )               109             (254 )
Total interest-bearing deposits                           395                (553 )           (158 )
Total increase (decrease) in interest expense             395                (553 )           (158 )

Increase (decrease) in net interest income $10,369 $(8,474) $1,895

(1) Deviations attributable to both volume and rate are consistently attributed

Basis between rate and volume based on the absolute value of the deviations in

    each category.



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Weighted average return of debentures

 The following table summarizes the maturity distribution schedule with
corresponding weighted average taxable equivalent yields of the debt securities
portfolio at March 31, 2022. The following table presents securities at their
expected maturities, which may differ from contractual maturities. The Company
manages its debt securities portfolio for liquidity, as a tool to execute its
asset/liability management strategy, and for pledging requirements for public
funds:

                                                                                                As of March 31, 2022
                                                                   After One Year But             After Five Years But
                                       Within One Year             Within Five Years                Within Ten Years               After Ten Years                  Total

                                    Amount        Yield *         Amount         Yield *         Amount           Yield *       Amount        Yield *       Amount        Yield *
Available-for-sale                                                                             (Dollars in thousands)
U.S. Federal agencies              $      41          3.15 %   $        210          3.51 %   $          -               0 %   $       -             0 %   $     251          3.45 %
Mortgage-backed securities             1,832          2.88           10,999          2.03           10,779            2.49        32,066          2.57        55,676          2.46
State and political subdivisions       3,680          2.18           15,368          1.98           12,535            2.39         1,380          2.39        32,963          2.18
U.S. Treasuries                            -             -           99,390          1.73            4,665            1.76             -             -       104,055          1.73
Corporate debt securities                  -             -                -             -            3,911            4.85         1,500          6.96         5,411          5.44
                           Total   $   5,553          2.42 %   $    125,967          1.79 %   $     31,890            2.63 %   $  34,946          2.75 %   $ 198,356          2.11 %
Percentage of total                     2.80 %                        63.50 %                        16.08 %                       17.62 %                    100.00 %


*Return is based on taxable equivalent using a tax rate of 21%

Provision for Loan Losses

Credit risk is inherent in the business of making loans. We establish an
Allowance for loan losses ("Allowance") through charges to earnings, which are
shown in the statements of income as the provision for loan losses. Specifically
identifiable and quantifiable known losses are charged off against the
Allowance. The provision for loan losses is determined by conducting a quarterly
evaluation of the adequacy of our Allowance and applying the shortfall or
excess, if any, to the current quarter's expense. Any shortfall between the
liquidation value of the underlying collateral and the recorded investment value
of the loan is considered the required specific reserve amount. See the
discussion under "-Critical Accounting Policies and Estimates-Allowance for Loan
and Lease Losses." This has the effect of creating variability in the amount and
frequency of charges to our earnings. The provision for loan losses and level of
Allowance for each period are dependent upon many factors, including loan
growth, net charge-offs, changes in the composition of the loan portfolio,
delinquencies, management's assessment of the quality of the loan portfolio, the
valuation of problem loans and the general economic conditions in our market
areas.

The allowance as a percentage of loans was 1.00% March 31, 2022 and December 31, 2021.

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Interest-free income

Noninterest income for the three months ended March 31, 2022 was $675,000
compared to $337,000 for the same period in 2021, an increase of $338,000, or
100.3%. The following table sets forth the major components of our noninterest
income for the three months ended March 31, 2022 and 2021:

                                                                 For the Three Months Ended
                                                                          March 31,
                                                       2022      2021      $ Increase       % Increase
                                                                           (Decrease)       (Decrease)
                                                                   (Dollars in thousands)
Noninterest income:
Secondary market income                               $  166     $  14     $       152          1085.71 %
Loss on sales of available-for-sale debt securities     (127 )       -            (127 )        -100.00 %
Service charges on deposit accounts                      249       120             129           107.50 %
Other income and fees                                    387       203             184            90.64 %
Total noninterest income                              $  675     $ 337     $       338           100.30 %



Secondary market income totaled $166,000 for the first quarter of 2022, compared
to $14,000 for the same period in 2021, an increase of $152,000, or 1085.7%. The
increase was attributable to an increase in mortgage lending activity. Other
income and fees totaled $387,000 for the first quarter of 2022, an increase of
$184,000 or 90.64% compared to the first quarter of 2021. The increase is due to
an overall increase in other income due to the acquisition of Watonga in
December 2021.

Interest-free expense

Noninterest expense for the three months ended March 31, 2022 was $6.4 million
compared to $4.5 million for the same period in 2021, an increase of $1.9
million, or 41.3%. The following table sets forth the major components of our
noninterest expense for the three months ended March 31, 2022 and 2021:

                                                     For the Three Months Ended
                                                              March 31,
                                         2022        2021        $ Increase       % Increase
                                                                 (Decrease)       (Decrease)
                                                       (Dollars in thousands)
Noninterest expense:
Salaries and employee benefits          $ 4,026     $ 2,790     $      1,236            44.30 %
Furniture and equipment                     358         202              156            77.23 %
Occupancy                                   551         472               79            16.74 %
Data and item processing                    387         279              108            38.71 %
Accounting, marketing, and legal fees       233         148               85            57.43 %
Regulatory assessments                      196         141               55            39.01 %
Advertising and public relations            110          34               76           223.53 %
Travel, lodging and entertainment            48          89              (41 )         -46.07 %
Other expense                               511         390              121            31.03 %
Total noninterest expense               $ 6,420     $ 4,545     $      1,875            41.25 %



Salaries and employee benefits totaled $4.0 million for the first quarter of
2022 compared to $2.8 million for the same period in 2021, an increase of $1.2
million or 44.3%.  This increase was attributable to an increase in employee
base due to bank-wide organic growth and the acquisition of Watonga in December
2021.

Furniture and equipment expense totaled $358,000 for the first quarter of 2022
compared to $202,000 for the same period in 2021, an increase of $156,000 or
77.2%. The increase is largely due to depreciation expense on assets acquired
from Watonga.

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Financial situation

The following discussion of our financial condition is comparable March 31, 2022 and
December 31, 2021.

Total Assets

Total assets increased $70.7 million, or 5.2%, to $1.4 billion as of March 31,
2022, compared to $1.4 billion as of December 31, 2021. The increasing trend in
total assets is primarily attributable to strong organic loan and deposit growth
within the Oklahoma City and Dallas/Fort Worth metropolitan areas and our
acquisition of Watonga in December 2021.

loan portfolio

The table below shows the balance and associated percentage of each major category in our loan portfolio as of today March 31, 2022 and December 31, 2021:

                                            As of March 31,                 As of December 31,
                                                  2022                             2021
                                        Amount         % of Total        Amount         % of Total
                                                         (Dollars in thousands)
Construction & development            $   172,381             16.2 %   $   169,322             16.4 %
1-4 family real estate                     58,184              5.5 %        62,971              6.1 %
Commercial real estate - other            334,835             31.5 %       339,655             33.0 %
Total commercial real estate              565,400             53.2 %       571,948             55.5 %

Commercial & industrial                   416,676             39.1 %       361,974             35.1 %
Agricultural                               62,984              5.9 %        73,010              7.1 %
Consumer                                   19,439              1.8 %        24,046              2.3 %
Gross loans                             1,064,499            100.0 %     1,030,978            100.0 %
Less: unearned income, net                 (2,678 )                         (2,577 )
Total Loans, net of unearned income     1,061,821                        

1,028,401

Less: Allowance for loan losses           (10,599 )                        (10,316 )
Net loans                             $ 1,051,222                      $ 1,018,085



Our loans represent the largest portion of our earning assets. The quality and
diversification of the loan portfolio is an important consideration when
reviewing our financial condition. As of March 31, 2022 and December 31, 2021,
our gross loans were $1.1 billion and $1.0 billion, respectively.  Included in
the commercial & industrial loan balances at March 31, 2022 and December 31,
2021, respectively, are $14.2 million and $18.7 million of loans that were
originated under the SBA PPP program.

We have established internal concentration limits in the loan portfolio for
Commercial Real Estate (CRE) loans, hospitality loans, energy loans, and
construction loans, among others. All loan types are within our established
limits. We use underwriting guidelines to assess each borrower's historical cash
flow to determine debt service capabilities, and we further stress test the
customer's debt service capability under higher interest rate scenarios as well
as other underlying macro-economic factors. Financial and performance covenants
are used in commercial lending to allow us to react to a borrower's
deteriorating financial condition, should that occur.

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The following tables show the contractual maturities of our gross loans as of
the periods below:

                                                                                                As of March 31, 2022
                                                                         Due after One Year              Due after Five Years
                                     Due in One Year or Less             Through Five Years             Through Fifteen Years             Due after Fifteen Years
                                    Fixed            Adjustable        Fixed        Adjustable         Fixed           Adjustable       Fixed          Adjustable           Total
                                     Rate               Rate           Rate            Rate            Rate               Rate          Rate              Rate
                                                                                               (Dollars in thousands)

construction $8,579 $71,187 $10,117 $75,659 $111 $2,313 $-

       $         4,415     $   172,381
1-4 family real estate                  3,367              8,995        15,182           16,393           1,150              6,548           -                 6,549          58,184
Commercial real estate - other          3,333             62,376        68,431          161,348           7,433             18,079           -                13,835         334,835
Total commercial real estate           15,279            142,558        93,730          253,400           8,694             26,940           -      

24,799 565,400

Commercial & industrial                25,108            154,302        16,466          187,623          19,781             12,749           -                   647         416,676
Agricultural                              354             14,063         5,376           34,978             543              1,353           -                 6,317          62,984
Consumer                                1,713                 34        10,326              148             931              2,299          84                 3,904          19,439
Gross loans                      $     42,454       $    310,957     $ 125,898     $    476,149     $    29,949       $     43,341     $    84       $        35,667     $ 1,064,499



                                                                                               As of December 31, 2021
                                                                         Due after One Year              Due after Five Years
                                     Due in One Year or Less             Through Five Years             Through Fifteen Years             Due after Fifteen Years
                                    Fixed            Adjustable        Fixed        Adjustable         Fixed           Adjustable       Fixed     
    Adjustable           Total
                                     Rate               Rate           Rate            Rate            Rate               Rate          Rate              Rate
                                                                                               (Dollars in thousands)

construction $7,283 $71,551 $10,148 $74,052 $- $2,243 $-

       $         4,045     $   169,322
1-4 family real estate                  3,259             21,322        11,979           11,674             926              7,375           -                 6,436          62,971
Commercial real estate - other          5,156             97,309        59,227          143,906             413             19,230           -                14,414         339,655
Total real estate                      15,698            190,182        81,354          229,632           1,339             28,848           -      

24,895 571,948

Commercial & industrial                24,249            142,553        16,346          145,654          20,474             12,047           -                   651         361,974
Agricultural                            2,529             17,441         5,156           39,305             623              1,587           -                 6,369          73,010
Consumer                                4,870                 29        10,825              172           1,554              2,458          84                 4,054          24,046
Gross loans                      $     47,346       $    350,205     $ 113,681     $    414,763     $    23,990       $     44,940     $    84       $        35,969     $ 1,030,978


Allowance for loan and lease losses

The allowance is based on management's estimate of potential losses inherent in
the loan portfolio. In the opinion of management, the allowance is adequate to
absorb estimated losses in the portfolio as of each balance sheet date. While
management uses available information to analyze losses on loans, future
additions to the allowance may be necessary based on changes in economic
conditions. In addition, various regulatory agencies, as an integral part of
their examination process, periodically review the Company's allowance. In
analyzing the adequacy of the allowance, a comprehensive loan grading system to
determine risk potential in loans is utilized together with the results of
internal credit reviews.

To determine the adequacy of the allowance, the loan portfolio is broken into
segments based on loan type. Historical loss experience factors by segment,
adjusted for changes in trends and conditions, are used to determine an
indicated allowance for each portfolio segment. These factors are evaluated and
updated based on the composition of the specific loan segment. Other
considerations include volumes and trends of delinquencies, nonaccrual loans,
levels of bankruptcies, criticized and classified loan trends, expected losses
on real estate secured loans, new credit products and policies, economic
conditions, concentrations of credit risk and the experience and abilities of
our lending personnel.

The allowance was $10.6 million at the March 31, 2022compared to $10.3 million at the
December 31, 2021.

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The following table provides an analysis of the activity in our allowance for
the periods indicated:

                                                    For the Three Months Ended March 31,
                                                       2022                       2021
                                                           (Dollars in thousands)
Balance at beginning of the period              $           10,316         $            9,639
Provision for loan losses                                      276                      1,275
Charge-offs:
Construction & development                                       -                          -
1-4 family real estate                                           -                          -
Commercial real estate - other                                   -                          -
Commercial & industrial                                          -                          -
Agricultural                                                     -                          -
Consumer                                                        (2 )                      (50 )
Total charge-offs                                               (2 )                      (50 )
Recoveries:
Construction & development                                       -                          -
1-4 family real estate                                           -                          -
Commercial real estate - other                                   -                          -
Commercial & industrial                                          -                          -
Agricultural                                                     -                          -
Consumer                                                         9                          -
Total recoveries                                                 9                          -
Net recoveries (charge-offs)                                     7                        (50 )
Balance at end of the period                    $           10,599         $           10,864
Net recoveries (charge-offs) to average loans                 0.00 %                     0.01 %



While the entire allowance is available to absorb losses from any and all loans,
the following table represents management's allocation of the allowance by loan
category, and the percentage of allowance in each category, for the periods
indicated:

                                    As of March 31,           As of December 31,
                                         2022                        2021
                                  Amount      Percent        Amount        Percent
                                               (Dollars in thousands)
Construction & development       $  1,717         16.2 %   $     1,695         16.4 %
1-4 family real estate                579          5.5 %           630          6.1 %
Commercial real estate - Other      3,334         31.5 %         3,399         33.0 %
Commercial & industrial             4,148         39.1 %         3,621         35.1 %
Agricultural                          627          5.9 %           730          7.1 %
Consumer                              194          1.8 %           241          2.3 %
Total                            $ 10,599        100.0 %   $    10,316        100.0 %



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Distressed Assets

Loans are considered delinquent when principal or interest payments are past due
30 days or more. Delinquent loans may remain on accrual status between 30 days
and 90 days past due. Loans on which the accrual of interest has been
discontinued are designated as nonaccrual loans. Typically, the accrual of
interest on loans is discontinued when principal or interest payments are past
due 90 days or when, in the opinion of management, there is a reasonable doubt
as to collectability of the obligation. When loans are placed on nonaccrual
status, all interest previously accrued but not collected is reversed against
current period interest income. Income on a nonaccrual loan is subsequently
recognized only to the extent that cash is received and the loan's principal
balance is deemed collectible. Loans are restored to accrual status when loans
become well-secured and management believes full collectability of principal and
interest is probable.

A loan is considered impaired when it is probable that we will be unable to
collect all amounts due according to the contractual terms of the loan
agreement. Impaired loans include loans on nonaccrual status and loans modified
in a troubled debt restructuring (TDR). Income from a loan on nonaccrual status
is recognized to the extent cash is received and when the loan's principal
balance is deemed collectible. Depending on a particular loan's circumstances,
we measure impairment of a loan based upon either the present value of expected
future cash flows discounted at the loan's effective interest rate, the loan's
observable market price, or the fair value of the collateral less estimated
costs to sell if the loan is collateral dependent. A loan is considered
collateral dependent when repayment of the loan is based solely on the
liquidation of the collateral. Fair value, where possible, is determined by
independent appraisals, typically on an annual basis. Between appraisal periods,
the fair value may be adjusted based on specific events, such as if
deterioration of quality of the collateral comes to our attention as part of our
problem loan monitoring process, or if discussions with the borrower lead us to
believe the last appraised value no longer reflects the actual market for the
collateral. The impairment amount on a collateral dependent loan is charged off
to the allowance if deemed not collectible and the impairment amount on a loan
that is not collateral dependent is set up as a specific reserve.

In cases where a borrower experiences financial difficulties and we make certain
concessionary modifications to contractual terms, the loan is classified as a
TDR. Included in certain loan categories of impaired loans are TDRs on which we
have granted concessions to the borrower as a result of the borrower
experiencing financial difficulties. The concessions granted by us may include,
but are not limited to: (1) a modification in which the maturity date, timing of
payments or frequency of payments is modified, (2) an interest rate lower than
the current market rate for new loans with similar risk, or (3) a combination of
the first two concessions.

If a borrower on a restructured TDR has demonstrated performance under the
previous terms, is not experiencing financial difficulty and shows the capacity
to continue to perform under the restructured terms, the loan will remain on
accrual status. Otherwise, the loan will be placed on nonaccrual status until
the borrower demonstrates a sustained period of performance, which generally
requires six consecutive months of payments. Loans identified as TDRs are
evaluated for impairment using the present value of the expected cash flows or
the estimated fair value of the collateral, if the loan is collateral dependent.
The fair value is determined, when possible, by an appraisal of the property
less estimated costs related to liquidation of the collateral. The appraisal
amount may also be adjusted for current market conditions. Adjustments to
reflect the present value of the expected cash flows or the estimated fair value
of collateral dependent loans are a component in determining an appropriate
allowance, and as such, may result in increases or decreases to the provision
for loan losses in current and future earnings.

Properties that we acquire as a result of foreclosure or by deed in lieu of foreclosure are classified as other real estate holdings or OREO until sold and are initially recognized at fair value less costs of sale upon acquisition, creating a new cost basis.

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The following table presents information regarding nonperforming assets as of
the dates indicated.

                                                            As of            As of
                                                          March 31,       December 31,
                                                            2022              2021
                                                             (Dollars in thousands)
Nonaccrual loans                                         $     9,539     $        9,885
Troubled-debt restructurings (1)                                   -        

Accruing loans 90 or more days past due                           91                496
Total nonperforming loans                                      9,630             10,381
Other real estate owned                                            -                  -
Total nonperforming assets                               $     9,630     $       10,381
Ratio of nonperforming loans to total loans                     0.91 %             1.01 %
Ratio of nonaccrual loans to total loans                        0.90 %             0.96 %
Ratio of allowance for loan losses to total loans               1.00 %             1.00 %
Ratio of allowance for loan losses to nonaccrual loans        111.12 %           104.36 %
Ratio of nonperforming assets to total assets                   0.68 %      

0.77%

(1) $1.4 million from TDRs March 31, 2022 and December 31, 2021 are included in the line above in the unaccrued loan balance

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The following tables show a maturity analysis of the loans on the given dates.

                                                                                     As of March 31, 2022
                                                                                            Loans 90+
                                   Loans 30-          Loans 60-          Loans 90+          days past
                                  59 days past       89 days past        days past           due and          Total past
                                      due                due                due              accruing          due loans         Current         Total loans
                                                                                    (Dollars in thousands)
Construction & development       $            -     $            -     $            -     $            -     $           -     $    172,381     $     172,381
1-4 family real estate                       26                  -                  -                  -                26           58,158            58,184
Commercial real estate - other                -                167                  -                  -               167          334,668           334,835
Commercial & industrial                      27                  3                119                 19               149          416,527           416,676
Agricultural                                443                  -                 59                 59               502           62,482            62,984
Consumer                                    426                  1                 13                 13               440           18,999            19,439
Total                            $          922     $          171     $          191     $           91     $       1,284     $  1,063,215     $   1,064,499



                                                                              As of December 31, 2021
                                                                                      Loans 90+
                                   Loans 30-         Loans 60-        Loans 90+       days past
                                 59 days past      89 days past       days past        due and        Total Past
                                      due               due              due          accruing        Due Loans         Current       Total loans
                                                                              (Dollars in thousands)
Construction & development       $           -     $           -     $         -     $         -     $          -     $   169,322     $    169,322
1-4 family real estate                       -                 -               -               -                -          62,971           62,971
Commercial real estate - other               -               174               -               -              174         339,481          339,655
Commercial & industrial                      -                19             501             401              520         361,454          361,974
Agricultural                                 -                 -              77              77               77          72,933           73,010
Consumer                                    48                15              18              18               81          23,965           24,046
Total                            $          48     $         208     $       596     $       496     $        852     $ 1,030,126     $  1,030,978


In addition to past due and non-accrual criteria, we also rate loans using our internal risk rating system. The loans are divided into the categories “Pass”, “Watch”, “Special Mention” and “Substandard”. The definitions of these categories are as follows:

Pass: These loans generally conform to Bank policies, are characterized by
policy-conforming advance rates on collateral, and have well-defined repayment
sources. In addition, these credits are extended to borrowers and guarantors
with a strong balance sheet and either substantial liquidity or a reliable
income history.

Watch: These loans are still considered "Pass" credits; however, various factors
such as industry stress, material changes in cash flow or financial conditions,
or deficiencies in loan documentation, or other risk issues determined by the
lending officer, Commercial Loan Committee or Credit Quality Committee warrant a
heightened sense and frequency of monitoring.

Special mention: These loans have observable weaknesses or evidence of imprudent
handling or structural issues. The weaknesses require close attention, and the
remediation of those weaknesses is necessary. No risk of probable loss exists.
Credits in this category are expected to quickly migrate to "Watch" or
"Substandard" as this is viewed as a transitory loan grade.

Substandard: These loans are not adequately protected by the sound worth and
debt service capacity of the borrower, but may be well-secured. The loans have
defined weaknesses relative to cash flow, collateral, financial condition or
other factors that might jeopardize repayment of all of the principal and
interest on a timely basis. There is the possibility that a future loss will
occur if weaknesses are not remediated.

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Outstanding loan balances categorized by internal risk class for the periods indicated are summarized as follows:

                                                           As of March 31, 2022
                                                               Special
                                    Pass          Watch        mention        Substandard         Total
                                                          (Dollars in thousands)
Construction & development       $   172,381     $      -     $        -     $           -     $   172,381
1-4 family real estate                58,184            -              -                 -          58,184

Commercial real estate – other 288,783 15,000 17,009

         14,043         334,835
Commercial & industrial              402,072          116            386            14,102         416,676
Agricultural                          62,513          327            144                 -          62,984
Consumer                              19,397           18              -                24          19,439
Total                            $ 1,003,330     $ 15,461     $   17,539     $      28,169     $ 1,064,499







                                                         As of December 31, 2021
                                                             Special
                                   Pass         Watch        mention        Substandard         Total
                                                         (Dollars in thousands)

construction $169,322 $-$-$

           -     $   169,322
1-4 family real estate              62,971            -              -                 -          62,971

Commercial real estate – other 282,268 14,976 27,112

       15,299         339,655
Commercial & industrial            341,661        4,658          6,300             9,355         361,974
Agricultural                        72,295          255            460                 -          73,010
Consumer                            24,000            -              -                46          24,046
Total                            $ 952,517     $ 19,889     $   33,872     $      24,700     $ 1,030,978



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Problematic debt restructuring

TDRs are defined as those loans in which a bank, for economic or legal reasons
related to a borrower's financial difficulties, grants a concession to the
borrower that it would not otherwise consider. A loan is considered impaired
when, based on current information and events, it is probable that the Company
will be unable to collect all amounts due from the borrower in accordance with
original contractual terms of the loan. Loans with insignificant delays or
insignificant short-falls in the amount of payments expected to be collected are
not considered to be impaired. Loans defined as individually impaired, based on
applicable accounting guidance, include larger balance nonperforming loans and
TDRs.

The following table presents loans restructured as TDRs as of March 31, 2022 and
December 31, 2021:

                                                                       As of March 31, 2022
                                                                                             Post-
                                                                                         Modification
                                                               

Pre-Modification Outstanding Specific

                                             Number of        Outstanding Recorded         Recorded          Reserves
                                             Contracts             Investment             Investment         Allocated
                                                                      (Dollars in thousands)
Commercial real estate                                 1     $                 1,351     $       1,351                 -
Total                                                  1     $                 1,351     $       1,351     $           -



                                                                      As of December 31, 2021
                                                                                              Post-
                                                                                          Modification
                                                                

Pre-Modification Outstanding Specific

                                             Number of         Outstanding Recorded         Recorded          Reserves
                                             Contracts              Investment             Investment         Allocated
                                                                       (Dollars in thousands)
Commercial real estate                                  1     $                 1,402     $       1,402                 -
Total                                                   1     $                 1,402     $       1,402     $           -



There were no payment defaults with respect to loans modified as TDRs as of
March 31, 2022 and December 31, 2021. Impairment analyses are prepared on TDRs
in conjunction with the normal allowance process. There were no TDRs
restructured during the three months ended March 31, 2022 and TDR's restructured
during the twelve months ended December 31, 2021 required no specific reserves.

The following table shows the total TDRs, in both cumulative and non-cumulative status, for the specified time periods:

                 As of March 31, 2022                As of December 31, 2021
             Number of
             contracts        Amount         Number of contracts        Amount
                                     (Dollars in thousands)
Accrual              -    $              -           -              $              -
Nonaccrual           1        1,351                            1        1,402
Total                1    $      1,351                         1    $      1,402



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insoles

We gather deposits primarily through our nine branch locations and online
through our website. We offer a variety of deposit products including demand
deposit accounts and interest-bearing products, such as savings accounts and
certificates of deposit. We put continued effort into gathering
noninterest-bearing demand deposit accounts through loan production
cross-selling, customer referrals, marketing efforts and various involvement
with community networks. Some of our interest-bearing deposits are obtained
through brokered transactions. We participate in the CDARS and ICS programs,
where customer funds are placed into multiple deposit accounts, each in an
amount under the standard FDIC insurance maximum of $250,000, and placed at a
network of banks across the United States.

Total deposits as of March 31, 2022 and December 31, 2021 were $1.3 billion and
$1.2 billion, respectively. The following table sets forth deposit balances by
certain categories as of the dates indicated and the percentage of each deposit
category to total deposits.

                                                   March 31,                         December 31,
                                                     2022                                2021
                                                         Percentage of                       Percentage of
                                          Amount             Total            Amount             Total
                                                              (Dollars in thousands)
Demand deposits                         $   420,972                32.8 %   $   366,705                30.1 %
Interest-bearing transaction deposits       606,246                47.2 %       583,389                47.9 %
Savings deposits                             97,520                 7.6 %        89,778                 7.4 %
Time deposits ($250,000 or less)            115,483                 9.0 %       132,690                10.9 %
Time deposits (more than $250,000)           43,058                 3.4 %        44,909                 3.7 %
Total interest-bearing deposits             862,307                67.2 %       850,766                69.9 %
Total deposits                          $ 1,283,279               100.0 %   $ 1,217,471               100.0 %



The following table summarizes our average deposit balances and weighted average
rates for the three-month period ending March 31, 2022 and year ended December
31, 2021:

                                                              For the Three Months Ended                For the Year Ended December
                                                                      March 31,                                     31,
                                                                         2022                                       2021
                                                             Average              Weighted A           Average               Weighted
                                                             Balance             verage Rate           Balance             Average Rate
                                                                                     (Dollars in thousands)
Demand deposits                                         $         385,664                 0.00 %   $        288,446                  0.00 %
Interest-bearing transaction deposits                             543,611                 0.30 %            375,048                  0.34 %
Savings deposits                                                   92,835                 0.21 %             55,220                  0.23 %
Time deposits                                                     169,602                 0.62 %            205,437                  0.81 %
Total interest-bearing deposits                                   806,048                 0.36 %            635,705                  0.48 %
Total deposits                                          $       1,191,712                 0.24 %   $        924,151                  0.33 %



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The following tables set forth the maturity of time deposits as of the dates
indicated below:

                                                            As of March 31, 2022 Maturity Within:
                                                           Three to Six       Six to 12       After 12
                                        Three Months          Months           Months          Months          Total
                                                                    (Dollars in thousands)
Time deposits ($250,000 or less)       $       37,375     $       19,006     $    29,628     $    29,474     $  115,483
Time deposits (more than $250,000)              5,584              6,663          24,617           6,194         43,058
Total time deposits                    $       42,959     $       25,669     $    54,245     $    35,668     $  158,541



                                                           As of December 31, 2021 Maturity Within:
                                                           Three to Six       Six to 12       After 12
                                        Three Months          Months           Months          Months          Total
                                                                    (Dollars in thousands)
Time deposits ($250,000 or less)       $       32,680     $       37,016     $    31,197     $    31,797     $  132,690
Time deposits (more than $250,000)             18,234              5,932          10,729          10,014         44,909
Total time deposits                    $       50,914     $       42,948     $    41,926     $    41,811     $  177,599



Liquidity

Liquidity refers to our ability to meet the cash flow requirements of depositors
and borrowers, while at the same time meeting our operating, capital and
strategic cash flow needs, all at a reasonable cost. We continuously monitor our
liquidity position to ensure that assets and liabilities are managed in a manner
that will meet all short-term and long-term cash requirements. We manage our
liquidity position to meet the daily cash flow needs of customers, while
maintaining an appropriate balance between assets and liabilities to meet the
return on investment objectives of our shareholders.

Our liquidity position is supported by cash management and access to alternative funding sources. Our liquid assets include cash on hand, interest-bearing deposits with correspondent banks and sold fed funds. Other available sources of liquidity are wholesale deposits and correspondent bank loans and advances from FHLB.

Our short-term and long-term liquidity requirements are primarily met through
cash flow from operations, redeployment of prepaying and maturing balances in
our loan portfolios, and increases in customer deposits. Other alternative
sources of funds will supplement these primary sources to the extent necessary
to meet additional liquidity requirements on either a short-term or long-term
basis.

As of March 31, 2022, we had no unsecured fed funds lines with correspondent
depository institutions with no amounts advanced. In addition, based on the
values of loans pledged as collateral, we had borrowing availability with the
FHLB of $86.2 million as of March 31, 2022 and $78.1 million as of December 31,
2021.

Capital Requirements

The Bank is subject to various regulatory capital requirements administered by
the federal and state banking regulators. Failure to meet regulatory capital
requirements may result in certain mandatory and possible additional
discretionary actions by regulators that, if undertaken, could have a direct
material effect on our financial statements. Under capital adequacy guidelines
and the regulatory framework for "prompt corrective action" (described below),
We must meet specific capital guidelines that involve quantitative measures of
our assets, liabilities and certain off-balance sheet items as calculated under
regulatory accounting policies. The capital amounts and classifications are
subject to qualitative judgments by the federal banking regulators about
components, risk weightings and other factors. Qualitative measures established
by regulation to ensure capital adequacy require us to maintain minimum amounts
and ratios of Common Equity Tier 1 ("CET1") capital, Tier 1 capital, total
capital to risk-weighted assets, and Tier 1 capital to average consolidated
assets, referred to as the "leverage ratio."

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As of March 31, 2022, the Bank was in compliance with all applicable regulatory
requirements and categorized as "well-capitalized" under the prompt corrective
action frame work.  There have been no conditions or events since March 31, 2022
that management believes would change this classification. The table below
presents our applicable capital requirements, as well as our capital ratios as
of March 31, 2022 and December 31, 2021. The Company exceeded all regulatory
capital requirements and the Bank was considered to be "well-capitalized" as of
the dates reflected in the tables below.

Basel III capital rules

Under the Basel III capital rules, to avoid restrictions on capital distributions, including dividend payments and certain discretionary bonus payments to senior executives, a banking organization must hold a capital conservation buffer composed of CET1 capital in excess of its minimum risk-based capital requirements. away March 31, 2022the Company and the Bank met all capital adequacy requirements under the Basel III capital requirements.

                                                                                                      Minimum to be "Well-
                                                                           With Capital                Capitalized" Under
                                                  Actual               Conservation Buffer          Prompt Corrective Action
                                            Amount        Ratio         Amount         Ratio          Amount            Ratio
                                                                          (Dollars in thousands)
As of March 31, 2022
Total capital (to risk-weighted assets)
Company                                    $ 133,374       12.54 %   $    111,708       10.50 %              N/A            N/A
Bank                                         133,488       12.56 %        

111,602 10.50% $106,288 10.00% Tier 1 capital (to risk-weighted assets) company

                                      122,776       11.54 %         90,431        8.50 %              N/A            N/A
Bank                                         122,889       11.56 %         90,345        8.50 %           85,030           8.00 %
CET 1 capital (to risk-weighted assets)
Company                                      122,776       11.54 %         74,472        7.00 %              N/A            N/A
Bank                                         122,889       11.56 %         74,401        7.00 %           69,087           6.50 %
Tier 1 capital (to average assets)
Company                                      122,776        9.27 %            N/A         N/A                N/A            N/A
Bank                                         122,889        9.28 %            N/A         N/A             66,176           5.00 %



                                                                                                      Minimum to be "Well-
                                                                           With Capital                Capitalized" Under
                                                  Actual               Conservation Buffer          Prompt Corrective Action
                                            Amount        Ratio         Amount         Ratio          Amount            Ratio
                                                                          (Dollars in thousands)
As of December 31, 2021
Total capital (to risk-weighted assets)
Company                                    $ 127,946       12.54 %   $    107,126       10.50 %              N/A            N/A
Bank                                         127,844       12.54 %        

107,020 10.50% $101,924 10.00% Tier 1 capital (to risk-weighted assets) company

                                      117,631       11.53 %         86,721        8.50 %              N/A            N/A
Bank                                         117,528       11.53 %         86,635        8.50 %           81,539           8.00 %
CET 1 capital (to risk-weighted assets)
Company                                      117,631       11.53 %         71,417        7.00 %              N/A            N/A
Bank                                         117,528       11.53 %         71,347        7.00 %           66,250           6.50 %
Tier 1 capital (to average assets)
Company                                      117,631       10.56 %            N/A         N/A                N/A            N/A
Bank                                         117,528       10.55 %            N/A         N/A             55,714           5.00 %



Shareholders' equity provides a source of permanent funding, allows for future
growth and provides a cushion to withstand unforeseen adverse developments.
Total shareholders' equity increased to $128.6 million as of March 31, 2022,
compared to $127.4 million as of December 31, 2021.

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Contractual obligations

The tables below provide supplemental information on our overall contractual commitments as of today March 31, 2022and December 31, 2021:

                                                             Payments Due 

away March 31, 2022

                                     Within One       One to Three       Three to Five      After Five
                                        Year             Years               Years             Years           Total
                                                                   (Dollars in thousands)
Deposits without a stated maturity   $ 1,124,738     $            -     $             -     $         -     $ 1,124,738
Time deposits                            122,872             33,723               1,946               -         158,541
Operating lease commitments                  606                689                 181               -           1,476
Total contractual obligations        $ 1,248,216     $       34,412     $         2,127     $         -     $ 1,284,755



                                                            Payments Due as of December 31, 2021
                                     Within One       One to Three       Three to Five      After Five
                                        Year             Years               Years             Years           Total
                                                                   (Dollars in thousands)
Deposits without a stated maturity   $ 1,039,872     $            -     $             -     $         -     $ 1,039,872
Time deposits                            135,788             39,904               1,907               -         177,599
Operating lease commitments                  611                782                 241               -           1,634
Total contractual obligations        $ 1,176,271     $       40,686     $         2,148     $         -     $ 1,219,105



We believe that we will be able to meet our contractual obligations as they come
due through the maintenance of adequate cash levels. We expect to maintain
adequate cash levels through profitability, loan repayment and maturity activity
and continued deposit gathering activities. We have in place various borrowing
mechanisms for both short-term and long-term liquidity needs.

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Off-Balance Sheet Arrangements

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. These
financial instruments include commitments to extend credit and standby letters
of credit. Those instruments involve, to varying degrees, elements of credit and
interest rate risk in excess of the amount recognized in the consolidated
balance sheet. The contractual or notional amounts of those instruments reflect
the extent of involvement we have in particular classes of financial
instruments.

Commitments to extend credit are agreements to lend to a customer as long as
there is no violation of any condition established in the contract. Commitments
generally have fixed expiration dates or other termination clauses and may
require payment of a fee. Since many of the commitments are expected to expire
without being drawn upon, the total commitment amount does not necessarily
represent future cash requirements. We evaluate each customer's creditworthiness
on a case-by-case basis. The amount of collateral obtained, if we deemed
necessary upon extension of credit, is based on management's credit evaluation
of the counterparty. The Company also estimates a reserve for potential losses
associated with off-balance sheet commitments and letters of credit. It is
included in other liabilities in the Company's consolidated statements of
condition, with any related provisions to the reserve included in non-interest
expense in the consolidated statement of income.

In determining the reserve for unfunded lending commitments, a process similar
to the one used for the allowance is employed. Based on historical experience,
loss factors, adjusted for expected funding, are applied to the Company's
off-balance sheet commitments and letters of credit to estimate the potential
for losses.

Standby letters of credit are conditional commitments issued by the Company to
guarantee the performance of the customer to a third party. They are intended to
be disbursed, subject to certain conditions, upon request of the borrower.

The table below summarizes the commitments on the given dates.

                               March 31,       December 31,
                                  2022             2021
                                  (Dollars in thousands)
Commitments to extend credit   $  215,268     $      200,393
Standby letters of credit           4,243              5,809
Total                          $  219,511     $      206,202


Critical Accounting Policies and Estimates

Our accounting and reporting policies conform to GAAP and conform to general
practices within the industry in which we operate. To prepare financial
statements in conformity with GAAP, management makes estimates, assumptions and
judgments based on available information. These estimates, assumptions and
judgments affect the amounts reported in the financial statements and
accompanying notes. These estimates, assumptions and judgments are based on
information available as of the date of the financial statements and, as this
information changes, actual results could differ from the estimates, assumptions
and judgments reflected in the financial statement. In particular, management
has identified several accounting policies that, due to the estimates,
assumptions and judgments inherent in those policies, are critical in
understanding our financial statements.

The JOBS Act permits us an extended transition period for complying with new or
revised accounting standards affecting public companies. We have elected to take
advantage of this extended transition period, which means that the financial
statements included in this Form 10-Q, as well as any financial statements that
we file in the future, will not be subject to all new or revised accounting
standards generally applicable to public companies for the transition period for
so long as we remain an emerging growth company or until we affirmatively and
irrevocably opt out of the extended transition period under the JOBS Act.

The following is a discussion of the critical accounting policies and
significant estimates that we believe require us to make the most complex or
subjective decisions or assessments. Additional information about these policies
can be found in Note 1 of our unaudited condensed consolidated financial
statements as of March 31, 2022.


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Allowance for loan and lease losses

The allowance is based on management's estimate of probable losses inherent in
the loan portfolio. In the opinion of management, the allowance is adequate to
absorb estimated losses in the portfolio as of each balance sheet date. While
management uses available information to analyze losses on loans, future
additions to the allowance may be necessary based on changes in economic
conditions and changes in the composition of the loan portfolio. In addition,
various regulatory agencies, as an integral part of their examination process,
periodically review the Bank's allowance. In analyzing the adequacy of the
allowance, a comprehensive loan grading system to determine risk potential in
loans is utilized together with the results of internal credit reviews.

To determine the adequacy of the allowance, the loan portfolio is broken into
segments based on loan type and risk characteristics. Historical loss experience
factors by segment, adjusted for changes in trends and conditions, are used to
determine an indicated allowance for each portfolio segment. These factors are
evaluated and updated based on the composition of the specific loan segment.
Other considerations include volumes and trends of delinquencies, nonaccrual
loans, levels of bankruptcies, criticized and classified loan trends, expected
losses on real estate secured loans, new credit products and policies, economic
conditions, concentrations of credit risk and the experience and abilities of
our lending personnel. In addition to the segment evaluations, impaired loans
with a balance of $250,000 or more are individually evaluated based on facts and
circumstances of the loan to determine if a specific allowance amount may be
necessary. Specific allowances may also be established for loans whose
outstanding balances are below the $250,000 threshold when it is determined that
the risk associated with the loan differs significantly from the risk factor
amounts established for its loan segment.

benevolence and intangibles

Intangible assets totaled $1.6 million and goodwill, net of accumulated
amortization, totaled $8.8 million for the three months ended March 31, 2022,
compared to intangible assets of $1.6 million and goodwill of $8.5 million for
the year ended December 31, 2021.

Goodwill resulting from a business combination represents the excess of the fair
value of the consideration transferred over the fair value of the net assets
acquired and liabilities assumed as of the acquisition date. Goodwill is tested
annually for impairment or more frequently if other impairment indicators are
present.  If the implied fair value of goodwill is lower than its carrying
amount, a goodwill impairment is indicated and goodwill is written down to its
implied fair value.  Subsequent increases in goodwill value are not recognized
in the accompanying consolidated financial statements.

Other intangible assets consist of intangible assets from core deposits and are amortized on a straight-line basis based on an estimated useful life of 10 years. Such assets are regularly evaluated with regard to the recoverability of their book values.

Income Taxes

We file a consolidated income tax return. Deferred taxes are recognized under
the balance sheet method based upon the future tax consequences of temporary
differences between the carrying amounts and tax basis of assets and
liabilities, using the tax rates expected to apply to taxable income in the
periods when the related temporary differences are expected to be realized.

The amount of accrued current and deferred income taxes is based on estimates of
taxes due or receivable from taxing authorities either currently or in the
future. Changes in these accruals are reported as tax expense, and involve
estimates of the various components included in determining taxable income, tax
credits, other taxes and temporary differences. Changes periodically occur in
the estimates due to changes in tax rates, tax laws and regulations and
implementation of new tax planning strategies. The process of determining the
accruals for income taxes necessarily involves the exercise of considerable
judgment and consideration of numerous subjective factors.

Management performs an analysis of our tax positions annually and believes it is
more likely than not that all of its tax positions will be utilized in future
years.

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POINT 3.

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Virginia C. Taylor