Loans and Leases

Summary of Major Loan and Lease Categories



	At September 30, 2017
(Dollars in thousands)	Originated			Acquired		Total
Commercial, financial and agricultural	$	782,769		$	76,448	$	859,217
Real estate-commercial	1,176,956			339,018		1,515,974
Real estate-construction	149,917			6,156		156,073
Real estate-residential secured for business purpose	213,811			96,209		310,020
Real estate-residential secured for personal purpose	249,283			66,623		315,906
Real estate-home equity secured for personal purpose	166,810			11,585		178,395
Loans to individuals	27,297			144		27,441
Lease financings	124,138			—		124,138
Total loans and leases held for investment, net of deferred income	$	2,890,981		$	596,183	$	3,487,164
Unearned lease income, included in the above table	$	(13,864	)	$	—	$	(13,864	)
Net deferred costs, included in the above table	4,725			—		4,725
Overdraft deposits included in the above table	68			—		68



	At December 31, 2016
(Dollars in thousands)	Originated			Acquired		Total
Commercial, financial and agricultural	$	663,221		$	160,045	$	823,266
Real estate-commercial	909,581			465,368		1,374,949
Real estate-construction	142,891			31,953		174,844
Real estate-residential secured for business purpose	151,931			142,137		294,068
Real estate-residential secured for personal purpose	210,377			80,431		290,808
Real estate-home equity secured for personal purpose	147,982			14,857		162,839
Loans to individuals	30,110			263		30,373
Lease financings	134,739			—		134,739
Total loans and leases held for investment, net of deferred income	$	2,390,832		$	895,054	$	3,285,886
Unearned lease income, included in the above table	$	(15,970	)	$	—	$	(15,970	)
Net deferred costs, included in the above table	4,503			—		4,503
Overdraft deposits included in the above table	84			—		84

Overdraft deposits are re-classified as loans and are included in the total loans and leases on the balance sheet.

The carrying amount of acquired loans at September 30, 2017 totaled $596.2 million, including $466.5 million of loans from the Fox Chase acquisition and $129.7 million from the Valley Green Bank acquisition. At September 30, 2017, loans acquired with deteriorated credit quality, or acquired credit impaired loans, totaled $1.6 million representing $832 thousand from the Fox Chase acquisition and $790 thousand from the Valley Green Bank acquisition. Acquired credit impaired loans are accounted for in accordance with Accounting Standards Codification (ASC) Topic 310-30.

The outstanding principal balance and carrying amount for acquired credit impaired loans at September 30, 2017 and December 31, 2016 were as follows:



(Dollars in thousands)	At September 30, 2017		At December 31, 2016
Outstanding principal balance	$	2,428	$	8,993
Carrying amount	1,622		7,352
Allowance for loan losses	—		—

The following table presents the changes in accretable yield on acquired credit impaired loans:



	Nine Months Ended September 30,
(Dollars in thousands)	2017			2016
Beginning of period	$	50		$	144
Acquisition of credit impaired loans	—			283
Reclassification from nonaccretable discount	823			318
Accretable discount amortized to interest income	(850		)	(501		)
Disposals	(4		)	(34		)
End of period	$	19		$	210

Age Analysis of Past Due Loans and Leases

The following presents, by class of loans and leases, an aging of past due loans and leases, loans and leases which are current and the recorded investment in loans and leases 90 days or more past due which are accruing interest at September 30, 2017 and December 31, 2016:



(Dollars in thousands)	30-59 Days Past Due		60-89 Days Past Due		90 Days or more Past Due		Total Past Due		Current		Acquired Credit Impaired		Total Loans and Leases Held for Investment		Recorded Investment 90 Days or more Past Due and Accruing Interest
At September 30, 2017
Commercial, financial and agricultural	$	1,537	$	164	$	1,594	$	3,295	$	855,457	$	465	$	859,217	$	—
Real estate—commercial real estate and construction:
Commercial real estate	4,510		164		1,688		6,362		1,509,256		356		1,515,974		164
Construction	861		—		365		1,226		154,847		—		156,073		—
Real estate—residential and home equity:
Residential secured for business purpose	541		265		1,255		2,061		307,375		584		310,020		—
Residential secured for personal purpose	2,428		172		446		3,046		312,643		217		315,906		423
Home equity secured for personal purpose	1,497		36		451		1,984		176,411		—		178,395		282
Loans to individuals	155		154		198		507		26,934		—		27,441		198
Lease financings	1,458		1,318		2,231		5,007		119,131		—		124,138		528
Total	$	12,987	$	2,273	$	8,228	$	23,488	$	3,462,054	$	1,622	$	3,487,164	$	1,595
At December 31, 2016
Commercial, financial and agricultural	$	1,536	$	256	$	1,335	$	3,127	$	819,550	$	589	$	823,266	$	—
Real estate—commercial real estate and construction:
Commercial real estate	1,482		1,560		2,591		5,633		1,363,606		5,710		1,374,949		—
Construction	202		—		—		202		174,642		—		174,844		—
Real estate—residential and home equity:
Residential secured for business purpose	1,390		428		1,539		3,357		289,927		784		294,068		—
Residential secured for personal purpose	3,243		905		879		5,027		285,512		269		290,808		481
Home equity secured for personal purpose	717		142		521		1,380		161,459		—		162,839		171
Loans to individuals	324		95		142		561		29,812		—		30,373		142
Lease financings	1,731		1,418		729		3,878		130,861		—		134,739		193
Total	$	10,625	$	4,804	$	7,736	$	23,165	$	3,255,369	$	7,352	$	3,285,886	$	987

Nonperforming Loans and Leases

The following presents, by class of loans and leases, nonperforming loans and leases at September 30, 2017 and December 31, 2016. Nonperforming loans exclude acquired credit impaired loans from Fox Chase and Valley Green.



	At September 30, 2017								At December 31, 2016
(Dollars in thousands)	Nonaccrual Loans and Leases*		Accruing Troubled Debt Restructured Loans and Lease Modifications		Loans and Leases 90 Days or more Past Due and Accruing Interest		Total Nonperforming Loans and Leases		Nonaccrual Loans and Leases*		Accruing Troubled Debt Restructured Loans and Lease Modifications		Loans and Leases 90 Days or more Past Due and Accruing Interest		Total Nonperforming Loans and Leases
Commercial, financial and agricultural	$	5,143	$	929	$	—	$	6,072	$	5,746	$	967	$	—	$	6,713
Real estate—commercial real estate and construction:
Commercial real estate	4,514		10,279		164		14,957		5,651		1,519		—		7,170
Construction	365		—		—		365		—		—		—		—
Real estate—residential and home equity:
Residential secured for business purpose	3,333		218		—		3,551		4,898		766		—		5,664
Residential secured for personal purpose	530		42		423		995		560		—		481		1,041
Home equity secured for personal purpose	361		—		282		643		525		—		171		696
Loans to individuals	—		—		198		198		—		—		142		142
Lease financings	1,703		—		528		2,231		536		—		193		729
Total	$	15,949	$	11,468	$	1,595	$	29,012	$	17,916	$	3,252	$	987	$	22,155

* Includes nonaccrual troubled debt restructured loans and lease modifications of $1.7 million and $1.8 million at September 30, 2017 and December 31, 2016, respectively.

Accruing troubled debt restructuring loans of $11.5 million includes balances of $9.2 million related to one borrower which were classified as troubled debt restructurings as the related loans were granted amortization period extensions during the second quarter of 2017.

Credit Quality Indicators

The following tables present by class, the recorded investment in loans and leases held for investment by credit quality indicator at September 30, 2017 and December 31, 2016.

The Corporation employs a ten (10) grade risk rating system related to the credit quality of commercial loans and residential real estate loans secured for a business purpose of which the first six categories are pass categories (credits not adversely rated). The following is a description of the internal risk ratings and the likelihood of loss related to each risk rating.


1.	Cash Secured—No credit risk


2.	Fully Secured—Negligible credit risk


3.	Strong—Minimal credit risk


4.	Satisfactory—Nominal credit risk


5.	Acceptable—Moderate credit risk


6.	Pre-Watch—Marginal, but stable credit risk


7.	Special Mention—Potential weakness


8.	Substandard—Well-defined weakness


9.	Doubtful—Collection in-full improbable


10.	Loss—Considered uncollectible

Commercial Credit Exposure Credit Risk by Internally Assigned Grades

The following table presents classifications for originated loans:



(Dollars in thousands)	Commercial, Financial and Agricultural		Real Estate— Commercial		Real Estate— Construction		Real Estate— Residential Secured for Business Purpose		Total
At September 30, 2017
Grade:
1. Cash secured/ 2. Fully secured	$	2,314	$	—	$	15,194	$	1,700	$	19,208
3. Strong	13,707		1,921		—		—		15,628
4. Satisfactory	31,732		30,158		—		350		62,240
5. Acceptable	537,421		901,571		74,898		184,904		1,698,794
6. Pre-watch	174,775		203,340		58,266		21,587		457,968
7. Special Mention	1,891		10,499		1,194		299		13,883
8. Substandard	20,929		29,467		365		4,971		55,732
9. Doubtful	—		—		—		—		—
10.Loss	—		—		—		—		—
Total	$	782,769	$	1,176,956	$	149,917	$	213,811	$	2,323,453
At December 31, 2016
Grade:
1. Cash secured/ 2. Fully secured	$	272	$	—	$	13,714	$	162	$	14,148
3. Strong	14,980		2,045		—		—		17,025
4. Satisfactory	35,529		38,861		—		367		74,757
5. Acceptable	465,675		676,212		110,650		133,716		1,386,253
6. Pre-watch	113,499		128,646		18,213		12,025		272,383
7. Special Mention	8,820		22,439		314		1,199		32,772
8. Substandard	24,446		41,378		—		4,462		70,286
9. Doubtful	—		—		—		—		—
10.Loss	—		—		—		—		—
Total	$	663,221	$	909,581	$	142,891	$	151,931	$	1,867,624

The following table presents classifications for acquired loans:



(Dollars in thousands)	Commercial, Financial and Agricultural		Real Estate— Commercial		Real Estate— Construction		Real Estate— Residential Secured for Business Purpose		Total
At September 30, 2017
Grade:
1. Cash secured/ 2. Fully secured	$	1,115	$	—	$	—	$	—	$	1,115
3. Strong	—		—		—		—		—
4. Satisfactory	132		501		—		—		633
5. Acceptable	62,601		199,298		—		75,749		337,648
6. Pre-watch	7,206		130,897		6,156		17,918		162,177
7. Special Mention	—		1,143		—		—		1,143
8. Substandard	5,394		7,179		—		2,542		15,115
9. Doubtful	—		—		—		—		—
10.Loss	—		—		—		—		—
Total	$	76,448	$	339,018	$	6,156	$	96,209	$	517,831
December 31, 2016
Grade:
1. Cash secured/ 2. Fully secured	$	583	$	—	$	—	$	—	$	583
3. Strong	—		—		—		—		—
4. Satisfactory	4,399		1,018		—		—		5,417
5. Acceptable	113,512		282,199		20,565		117,322		533,598
6. Pre-watch	31,697		163,623		11,388		14,405		221,113
7. Special Mention	73		7,705		—		6,245		14,023
8. Substandard	9,781		10,823		—		4,165		24,769
9. Doubtful	—		—		—		—		—
10.Loss	—		—		—		—		—
Total	$	160,045	$	465,368	$	31,953	$	142,137	$	799,503

Credit Exposure—Real Estate—Residential Secured for Personal Purpose, Real Estate—Home Equity Secured for Personal Purpose, Loans to individuals, Lease Financing Credit Risk Profile by Payment Activity

The Corporation monitors the credit risk profile by payment activity for the following classifications of loans and leases: residential real estate loans secured for a personal purpose, home equity loans secured for a personal purpose, loans to individuals and lease financings. Nonperforming loans and leases are loans and leases past due 90 days or more, loans and leases on nonaccrual of interest and troubled debt restructured loans and lease modifications. Performing loans and leases are reviewed only if the loan becomes 60 days or more past due. Nonperforming loans and leases are reviewed monthly. Performing loans and leases have a nominal to moderate risk of loss.

The following table presents classifications for originated loans:



(Dollars in thousands)	Real Estate— Residential Secured for Personal Purpose		Real Estate— Home Equity Secured for Personal Purpose		Loans to Individuals		Lease Financings		Total
At September 30, 2017
Performing	$	248,796	$	166,414	$	27,099	$	121,907	$	564,216
Nonperforming	487		396		198		2,231		3,312
Total	$	249,283	$	166,810	$	27,297	$	124,138	$	567,528
At December 31, 2016
Performing	$	210,208	$	147,286	$	29,968	$	134,010	$	521,472
Nonperforming	169		696		142		729		1,736
Total	$	210,377	$	147,982	$	30,110	$	134,739	$	523,208

The following table presents classifications for acquired loans:



(Dollars in thousands)	Real Estate— Residential Secured for Personal Purpose		Real Estate— Home Equity Secured for Personal Purpose		Loans to Individuals		Lease Financings		Total
At September 30, 2017
Performing	$	66,115	$	11,338	$	144	$	—	$	77,597
Nonperforming	508		247		—		—		755
Total	$	66,623	$	11,585	$	144	$	—	$	78,352
At December 31, 2016
Performing	$	79,559	$	14,857	$	263	$	—	$	94,679
Nonperforming	872		—		—		—		872
Total	$	80,431	$	14,857	$	263	$	—	$	95,551

Reserve for Loan and Lease Losses and Recorded Investment in Loans and Leases

The following presents, by portfolio segment, a summary of the activity in the reserve for loan and lease losses for the three and nine months ended September 30, 2017 and 2016:



(Dollars in thousands)	Commercial, Financial and Agricultural			Real Estate— Commercial and Construction			Real Estate— Residential Secured for Business Purpose			Real Estate— Residential and Home Equity Secured for Personal Purpose			Loans to Individuals			Lease Financings			Unallocated			Total
Three Months Ended September 30, 2017
Reserve for loan and lease losses:
Beginning balance	$	8,313		$	8,468		$	1,129		$	974		$	329		$	1,660		$	37		$	20,910
Charge-offs	(290		)	—			(56		)	(83		)	(61		)	(3,097		)	N/A			(3,587		)
Recoveries	325			1			29			68			35			73			N/A			531
(Recovery of provision) provision	(1,732		)	787			204			756			51			2,654			(30		)	2,690
Recovery of provision for acquired credit impaired loans	—			—			(1		)	—			—			—			—			(1		)
Ending balance	$	6,616		$	9,256		$	1,305		$	1,715		$	354		$	1,290		$	7		$	20,543
Three Months Ended September 30, 2016
Reserve for loan and lease losses:
Beginning balance	$	5,788		$	7,549		$	56		$	1,301		$	411		$	1,121		$	927		$	17,153
Charge-offs	(1,753		)	(100		)	(3		)	(34		)	(123		)	(176		)	N/A			(2,189		)
Recoveries	351			83			9			15			28			34			N/A			520
Provision (recovery of provision)	1,300			(388		)	(32		)	268			114			184			(30		)	1,416
Recovery of provision for acquired credit impaired loans	—			—			—			(1		)	—			—			—			(1		)
Ending balance	$	5,686		$	7,144		$	30		$	1,549		$	430		$	1,163		$	897		$	16,899
Nine Months Ended September 30, 2017
Reserve for loan and lease losses:
Beginning balance	$	7,037		$	7,505		$	774		$	993		$	364		$	788		$	38		$	17,499
Charge-offs	(576		)	(30		)	(1,237		)	(177		)	(301		)	(3,681		)	N/A			(6,002		)
Recoveries	722			4			47			89			116			168			N/A			1,146
(Recovery of provision) provision	(567		)	1,777			1,722			808			175			4,015			(31		)	7,899
(Recovery of provision) provision for acquired credit impaired loans	—			—			(1		)	2			—			—			—			1
Ending balance	$	6,616		$	9,256		$	1,305		$	1,715		$	354		$	1,290		$	7		$	20,543
Nine Months Ended September 30, 2016
Reserve for loan and lease losses:
Beginning balance	$	6,418		$	6,572		$	763		$	1,575		$	346		$	1,042		$	912		$	17,628
Charge-offs	(3,580		)	(305		)	(268		)	(90		)	(307		)	(541		)	N/A			(5,091		)
Recoveries	1,316			99			62			66			91			157			N/A			1,791
Provision (recovery of provision)	1,532			600			(527		)	1			300			505			(15		)	2,396
Provision (recovery of provision) for acquired credit impaired loans	—			178			—			(3		)	—			—			—			175
Ending balance	$	5,686		$	7,144		$	30		$	1,549		$	430		$	1,163		$	897		$	16,899

N/A – Not applicable

During the quarter ended September 30, 2017, the Corporation recorded charge-offs of $2.8 million related to $5.0 million of software leases under a vendor referral program. The provision for loan losses related to this program was $1.9 million during the quarter ended September 30, 2017 as the Corporation had an allowance for loan and lease losses reserve of $886 thousand as of June 30, 2017. These leases are personally guaranteed by 29 high net worth individuals. During the first quarter of 2017, the lessees stopped making payments due to disputes with the vendor, and Univest Capital, Inc., a subsidiary of the Corporation, filed legal complaints to pursue collection of all amounts owed. A complaint was subsequently filed against Univest Capital Inc. and certain other defendants on March 28, 2017 by one of the lessees in federal court in Texas seeking, among other things, class action certification and a declaration that the contracts and related guarantees are null and void. On September 25, 2017, Univest Capital, Inc. entered into a Release and Settlement Agreement whereby Univest Capital, Inc. will receive $1.0 million based upon court approval of the Agreement and is eligible to receive up to an additional $1.3 million. Payment of the $1.3 million is subject to the individual guarantor's election of whether or not they will be subject to the Release and Settlement Agreement. It is expected this election process will be completed by March 31, 2018. If a guarantor elects to be subject to the Release and Settlement Agreement, Univest Capital, Inc. will receive a payment of $43 thousand per guarantor. If a guarantor elects not to be subject to the Release and Settlement Agreement, Univest Capital, Inc. has the right to pursue collection of the full amount owed, which ranges from $108 thousand to $228 thousand per guarantor, via the normal collection process. As of September 30, 2017, Univest Capital, Inc. has a receivable totaling $2.3 million related to this matter, of which $1.3 million is recorded as a nonaccruing lease receivable and $1.0 million is included in other assets. The $1.0 million payment under the Release and Settlement Agreement, which is subject to court approval, is currently in escrow and is expected to be received during the fourth quarter of 2017.

The following presents, by portfolio segment, a summary of the balance in the reserve for loan and lease losses disaggregated on the basis of impairment method and the recorded investment in loans and leases disaggregated on the basis of impairment method at September 30, 2017 and 2016:



(Dollars in thousands)	Commercial, Financial and Agricultural		Real Estate— Commercial and Construction		Real Estate— Residential Secured for Business Purpose		Real Estate— Residential and Home Equity Secured for Personal Purpose		Loans to Individuals		Lease Financings		Unallocated		Total
At September 30, 2017
Reserve for loan and lease losses:
Ending balance: individually evaluated for impairment	$	15	$	40	$	33	$	—	$	—	$	—	N/A		$	88
Ending balance: collectively evaluated for impairment	6,601		9,216		1,272		1,715		354		1,290		7		20,455
Total ending balance	$	6,616	$	9,256	$	1,305	$	1,715	$	354	$	1,290	$	7	$	20,543
Loans and leases held for investment:
Ending balance: individually evaluated for impairment	$	7,883	$	17,274	$	4,471	$	932	$	—	$	1,250			$	31,810
Ending balance: collectively evaluated for impairment	774,886		1,307,585		209,340		415,161		27,297		122,888				2,857,157
Loans measured at fair value	—		2,014		—		—		—		—				2,014
Acquired non-credit impaired loans	75,983		344,818		95,625		77,991		144		—				594,561
Acquired credit impaired loans	465		356		584		217		—		—				1,622
Total ending balance	$	859,217	$	1,672,047	$	310,020	$	494,301	$	27,441	$	124,138			$	3,487,164
At September 30, 2016
Reserve for loan and lease losses:
Ending balance: individually evaluated for impairment	$	—	$	—	$	5	$	—	$	—	$	—	N/A		$	5
Ending balance: collectively evaluated for impairment	5,686		7,144		25		1,549		430		1,163		897		16,894
Total ending balance	$	5,686	$	7,144	$	30	$	1,549	$	430	$	1,163	$	897	$	16,899
Loans and leases held for investment:
Ending balance: individually evaluated for impairment	$	10,273	$	23,014	$	4,614	$	1,078	$	—	$	—			$	38,979
Ending balance: collectively evaluated for impairment	587,901		950,730		127,096		341,647		30,137		129,885				2,167,396
Loans measured at fair value	—		2,234		—		—		—		—				2,234
Acquired non-credit impaired loans	184,784		525,944		155,348		100,589		512		—				967,177
Acquired credit impaired loans	722		12,451		1,136		266		—		—				14,575
Total ending balance	$	783,680	$	1,514,373	$	288,194	$	443,580	$	30,649	$	129,885			$	3,190,361

N/A – Not applicable

The Corporation records a provision for loan loss for the acquired non-impaired loans only when additional deterioration of the portfolio is identified over the projections utilized in the initial fair value analysis. After the acquisition measurement period, the present value of any decreases in expected cash flows of acquired credit impaired loans will generally result in an impairment charge recorded as a provision for loan loss, resulting in an increase to the allowance.

Impaired Loans

The following presents, by class of loans, the recorded investment and unpaid principal balance of impaired loans, the amounts of the impaired loans for which there is not a reserve for credit losses and the amounts for which there is a reserve for credit losses at September 30, 2017 and December 31, 2016. The impaired loans exclude acquired credit impaired loans.



	At September 30, 2017						At December 31, 2016
(Dollars in thousands)	Recorded Investment		Unpaid Principal Balance		Related Reserve		Recorded Investment		Unpaid Principal Balance		Related Reserve
Impaired loans with no related reserve recorded:
Commercial, financial and agricultural	$	7,721	$	9,332			$	10,911	$	12,561
Real estate—commercial real estate	15,727		16,616				24,469		25,342
Real estate—construction	365		365				—		—
Real estate—residential secured for business purpose	3,933		5,040				5,704		6,253
Real estate—residential secured for personal purpose	572		628				560		594
Real estate—home equity secured for personal purpose	360		367				525		528
Total impaired loans with no related reserve recorded	$	28,678	$	32,348			$	42,169	$	45,278
Impaired loans with a reserve recorded:
Commercial, financial and agricultural	$	162	$	165	$	15	$	166	$	166	$	19
Real estate—commercial real estate	1,182		1,182		40		597		597		25
Real estate—residential secured for business purpose	538		539		33		983		1,105		191
Total impaired loans with a reserve recorded	$	1,882	$	1,886	$	88	$	1,746	$	1,868	$	235



	At September 30, 2017						At December 31, 2016
(Dollars in thousands)	Recorded Investment		Unpaid Principal Balance		Related Reserve		Recorded Investment		Unpaid Principal Balance		Related Reserve
Total impaired loans:
Commercial, financial and agricultural	$	7,883	$	9,497	$	15	$	11,077	$	12,727	$	19
Real estate—commercial real estate	16,909		17,798		40		25,066		25,939		25
Real estate—construction	365		365		—		—		—		—
Real estate—residential secured for business purpose	4,471		5,579		33		6,687		7,358		191
Real estate—residential secured for personal purpose	572		628		—		560		594		—
Real estate—home equity secured for personal purpose	360		367		—		525		528		—
Total impaired loans	$	30,560	$	34,234	$	88	$	43,915	$	47,146	$	235

Impaired loans include nonaccrual loans, accruing troubled debt restructured loans and other accruing impaired loans for which it is probable that not all principal and interest payments due will be collectible in accordance with the contractual terms. These loans are individually measured to determine the amount of potential impairment. The loans are reviewed for impairment based on the fair value of the collateral for collateral dependent loans and for certain loans based on discounted cash flows using the loans’ initial effective interest rates. Impaired loans include other accruing impaired loans of $4.8 million and $23.3 million at September 30, 2017 and December 31, 2016, respectively. Specific reserves on other accruing impaired loans were $73 thousand and $84 thousand at September 30, 2017 and December 31, 2016, respectively.

The following presents by class of loans, the average recorded investment in impaired loans and an analysis of interest on impaired loans. A loan may remain on accrual status if it is in the process of collection and is either guaranteed or well secured. Therefore, interest income on accruing impaired loans is recognized using the accrual method.



	Three Months Ended September 30, 2017						Three Months Ended September 30, 2016
(Dollars in thousands)	Average Recorded Investment		Interest Income Recognized*		Additional Interest Income That Would Have Been Recognized Under Original Terms		Average Recorded Investment		Interest Income Recognized*		Additional Interest Income That Would Have Been Recognized Under Original Terms
Commercial, financial and agricultural	$	10,211	$	52	$	92	$	12,880	$	62	$	108
Real estate—commercial real estate	18,583		201		69		25,309		273		58
Real estate—construction	365		—		5		—		—		—
Real estate—residential secured for business purpose	3,579		16		34		3,178		11		34
Real estate—residential secured for personal purpose	635		1		8		447		—		6
Real estate—home equity secured for personal purpose	288		—		5		598		—		7
Total	$	33,661	$	270	$	213	$	42,412	$	346	$	213


*	Includes interest income recognized on a cash basis for nonaccrual loans of $0 thousand for the three months ended September 30, 2017 and 2016, and interest income recognized on the accrual method for accruing impaired loans of $270 thousand and $346 thousand for the three months ended September 30, 2017 and 2016, respectively.



	Nine Months Ended September 30, 2017						Nine Months Ended September 30, 2016
(Dollars in thousands)	Average Recorded Investment		Interest Income Recognized*		Additional Interest Income That Would Have Been Recognized Under Original Terms		Average Recorded Investment		Interest Income Recognized*		Additional Interest Income That Would Have Been Recognized Under Original Terms
Commercial, financial and agricultural	$	11,030	$	162	$	263	$	13,233	$	204	$	281
Real estate—commercial real estate	21,120		618		223		27,346		859		186
Real estate—construction	219		—		15		—		—		—
Real estate—residential secured for business purpose	4,053		53		139		3,818		47		141
Real estate—residential secured for personal purpose	629		2		31		485		2		15
Real estate—home equity secured for personal purpose	391		—		15		408		—		18
Total	$	37,442	$	835	$	686	$	45,290	$	1,112	$	641


*	Includes interest income recognized on a cash basis for nonaccrual loans of $4 thousand and $7 thousand for the nine months ended September 30, 2017 and 2016, respectively, and interest income recognized on the accrual method for accruing impaired loans of $831 thousand and $1.1 million for the nine months ended September 30, 2017 and 2016, respectively.

Impaired Leases

The Corporation had impaired leases of $1.3 million with no related reserves at September 30, 2017. The Corporation had no impaired leases at December 31, 2016. See discussion in Nonperforming Loans and Leases.

Troubled Debt Restructured Loans

The following presents, by class of loans, information regarding accruing and nonaccrual loans that were restructured:



	Three Months Ended September 30, 2017							Three Months Ended September 30, 2016
(Dollars in thousands)	Number of Loans	Pre- Restructuring Outstanding Recorded Investment		Post- Restructuring Outstanding Recorded Investment		Related Reserve		Number of Loans	Pre- Restructuring Outstanding Recorded Investment		Post- Restructuring Outstanding Recorded Investment		Related Reserve
Accruing Troubled Debt Restructured Loans:
Total	—	$	—	$	—	$	—	—	$	—	$	—	$	—
Nonaccrual Troubled Debt Restructured Loans:
Real estate—residential secured for personal purpose	—	$	—	$	—	$	—	1	$	34	$	34	$	—
Total	—	$	—	$	—	$	—	1	$	34	$	34	$	—



	Nine Months Ended September 30, 2017							Nine Months Ended September 30, 2016
(Dollars in thousands)	Number of Loans	Pre- Restructuring Outstanding Recorded Investment		Post- Restructuring Outstanding Recorded Investment		Related Allowance		Number of Loans	Pre- Restructuring Outstanding Recorded Investment		Post- Restructuring Outstanding Recorded Investment		Related Allowance
Accruing Troubled Debt Restructured Loans:
Commercial, financial and agricultural	—	$	—	$	—	$	—	1	$	1,545	$	1,545	$	—
Real estate—commercial real estate	3	9,206		9,206		—		—	—		—		—
Real estate—residential secured for business purpose	—	—		—		—		1	415		415		—
Total	3	$	9,206	$	9,206	$	—	2	$	1,960	$	1,960	$	—
Nonaccrual Troubled Debt Restructured Loans:
Real estate—commercial real estate	1	$	328	$	328	$	—	—	$	—	$	—	$	—
Real estate—residential secured for personal purpose	—	—		—		—		1	34		34		—
Total	1	$	328	$	328	$	—	1	$	34	$	34	$	—

The Corporation grants concessions to existing borrowers primarily related to extensions of interest-only payment periods and an occasional payment modification. These modifications typically are for up to one year. The goal when restructuring a credit is to establish a reasonable period of time to provide cash flow relief to customers experiencing cash flow difficulties. Accruing troubled debt restructured loans are primarily comprised of loans on which interest is being accrued under the restructured terms, and the loans are current or less than ninety days past due.

The following presents, by class of loans, information regarding the types of concessions granted on accruing and nonaccrual loans that were restructured during the three and nine months ended September 30, 2017 and 2016.



	Interest Only Term Extension			Maturity Date Extension			Amortization Period Extension			Total Concessions Granted
(Dollars in thousands)	No. of Loans	Amount		No. of Loans	Amount		No. of Loans	Amount		No. of Loans	Amount
Three Months Ended September 30, 2017
Accruing Troubled Debt Restructured Loans:
Total	—	$	—	—	$	—	—	$	—	—	$	—
Nonaccrual Troubled Debt Restructured Loans:
Total	—	$	—	—	$	—	—	$	—	—	$	—
Three Months Ended September 30, 2016
Accruing Troubled Debt Restructured Loans:
Total	—	$	—	—	$	—	—	$	—	—	$	—
Nonaccrual Troubled Debt Restructured Loans:
Real estate—residential secured for personal purpose	—	$	—	1	$	34	—	$	—	1	$	34
Total	—	$	—	1	$	34	—	$	—	1	$	34
Nine Months Ended September 30, 2017
Accruing Troubled Debt Restructured Loans:
Real estate—commercial real estate	—	$	—	—	$	—	3	$	9,206	3	$	9,206
Total	—	$	—	—	$	—	3	$	9,206	3	$	9,206
Nonaccrual Troubled Debt Restructured Loans:
Real estate—commercial real estate	—	$	—	1	$	328	—	$	—	1	$	328
Total	—	$	—	1	$	328	—	$	—	1	$	328
Nine Months Ended September 30, 2016
Accruing Troubled Debt Restructured Loans:
Commercial, financial and agricultural	—	$	—	—	$	—	1	$	1,545	1	$	1,545
Real estate—residential secured for business purpose	1	415		—	—		—	—		1	415
Total	1	$	415	—	$	—	1	$	1,545	2	$	1,960
Nonaccrual Troubled Debt Restructured Loans:
Real estate—residential secured for personal purpose	—	$	—	1	$	34	—	$	—	1	$	34
Total	—	$	—	1	$	34	—	$	—	1	$	34

The following presents, by class of loans, information regarding accruing and nonaccrual troubled debt restructured loans, for which there were payment defaults within twelve months of the restructuring date:



	Three Months Ended September 30,						Nine Months Ended September 30,
	2017			2016			2017			2016
(Dollars in thousands)	Number of Loans	Recorded Investment		Number of Loans	Recorded Investment		Number of Loans	Recorded Investment		Number of Loans	Recorded Investment
Accruing Troubled Debt Restructured Loans:
Total	—	$	—	—	$	—	—	$	—	—	$	—
Nonaccrual Troubled Debt Restructured Loans:
Real estate—residential secured for personal purpose	—	$	—	1	$	34	—	$	—	1	$	34
Total	—	$	—	1	$	34	—	$	—	1	$	34

The following presents, by class of loans, information regarding consumer mortgages collateralized by residential real estate property that are in the process of foreclosure at September 30, 2017 and December 31, 2016:



(Dollars in thousands)	At September 30, 2017		At December 31, 2016
Real estate-home equity secured for personal purpose	$	—	$	180
Total	$	—	$	180

The Corporation held no foreclosed consumer residential real estate property at September 30, 2017 and December 31, 2016.