Loans and Leases

Summary of Major Loan and Lease Categories



	At September 30, 2018
(Dollars in thousands)	Originated			Acquired		Total
Commercial, financial and agricultural	$	867,636		$	26,686	$	894,322
Real estate-commercial	1,442,681			254,462		1,697,143
Real estate-construction	188,895			3,742		192,637
Real estate-residential secured for business purpose	279,800			66,531		346,331
Real estate-residential secured for personal purpose	327,833			52,676		380,509
Real estate-home equity secured for personal purpose	177,632			9,349		186,981
Loans to individuals	32,096			142		32,238
Lease financings	136,008			—		136,008
Total loans and leases held for investment, net of deferred income	$	3,452,581		$	413,588	$	3,866,169
Unearned lease income, included in the above table	$	(15,079	)	$	—	$	(15,079	)
Net deferred costs, included in the above table	4,064			—		4,064
Overdraft deposits included in the above table	156			—		156



	At December 31, 2017
(Dollars in thousands)	Originated			Acquired		Total
Commercial, financial and agricultural	$	833,100		$	63,111	$	896,211
Real estate-commercial	1,235,681			306,460		1,542,141
Real estate-construction	171,244			4,592		175,836
Real estate-residential secured for business purpose	250,800			91,167		341,967
Real estate-residential secured for personal purpose	260,654			60,920		321,574
Real estate-home equity secured for personal purpose	171,884			12,386		184,270
Loans to individuals	28,156			144		28,300
Lease financings	129,768			—		129,768
Total loans and leases held for investment, net of deferred income	$	3,081,287		$	538,780	$	3,620,067
Unearned lease income, included in the above table	$	(14,243	)	$	—	$	(14,243	)
Net deferred costs, included in the above table	4,669			—		4,669
Overdraft deposits included in the above table	222			—		222

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, 2018 totaled $413.6 million, including $339.3 million of loans from the Fox Chase acquisition and $74.3 million from the Valley Green Bank acquisition. At September 30, 2018, loans acquired with deteriorated credit quality, or acquired credit impaired loans, totaled $900 thousand representing $246 thousand from the Fox Chase acquisition and $654 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, 2018 and December 31, 2017 were as follows:



(Dollars in thousands)	At September 30, 2018		At December 31, 2017
Outstanding principal balance	$	1,218	$	2,325
Carrying amount	900		1,583
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)	2018			2017
Beginning of period	$	11		$	50
Reclassification from nonaccretable discount	453			823
Accretable discount amortized to interest income	(464		)	(850		)
Disposals	—			(4		)
End of period	$	—		$	19

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, 2018 and December 31, 2017:



(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, 2018
Commercial, financial and agricultural	$	661	$	9,151	$	1,003	$	10,815	$	883,325	$	182	$	894,322	$	—
Real estate—commercial real estate and construction:
Commercial real estate	1,168		373		1,313		2,854		1,694,083		206		1,697,143		83
Construction	—		—		—		—		192,637		—		192,637		—
Real estate—residential and home equity:
Residential secured for business purpose	2,221		47		1,265		3,533		342,350		448		346,331		—
Residential secured for personal purpose	2,403		981		1,419		4,803		375,642		64		380,509		—
Home equity secured for personal purpose	406		189		1,329		1,924		185,057		—		186,981		128
Loans to individuals	101		32		165		298		31,940		—		32,238		165
Lease financings	897		1,639		2,390		4,926		131,082		—		136,008		848
Total	$	7,857	$	12,412	$	8,884	$	29,153	$	3,836,116	$	900	$	3,866,169	$	1,224
At December 31, 2017
Commercial, financial and agricultural	$	2,182	$	1,440	$	1,509	$	5,131	$	890,658	$	422	$	896,211	$	—
Real estate—commercial real estate and construction:
Commercial real estate	733		548		1,410		2,691		1,539,094		356		1,542,141		—
Construction	1,970		—		365		2,335		173,501		—		175,836		—
Real estate—residential and home equity:
Residential secured for business purpose	1,651		315		1,355		3,321		338,061		585		341,967		162
Residential secured for personal purpose	4,368		1,118		23		5,509		315,845		220		321,574		—
Home equity secured for personal purpose	1,414		333		464		2,211		182,059		—		184,270		148
Loans to individuals	221		139		195		555		27,745		—		28,300		195
Lease financings	1,143		392		1,855		3,390		126,378		—		129,768		256
Total	$	13,682	$	4,285	$	7,176	$	25,143	$	3,593,341	$	1,583	$	3,620,067	$	761

Nonperforming Loans and Leases

The following presents, by class of loans and leases, nonperforming loans and leases at September 30, 2018 and December 31, 2017. Nonperforming loans exclude acquired credit impaired loans from Fox Chase and Valley Green.



	At September 30, 2018								At December 31, 2017
(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	$	2,795	$	595	$	—	$	3,390	$	4,448	$	921	$	—	$	5,369
Real estate—commercial real estate and construction:
Commercial real estate	18,425		—		83		18,508		4,285		10,266		—		14,551
Construction	106		—		—		106		365		—		—		365
Real estate—residential and home equity:
Residential secured for business purpose	1,416		171		—		1,587		2,843		206		162		3,211
Residential secured for personal purpose	1,815		—		—		1,815		466		42		—		508
Home equity secured for personal purpose	1,460		—		128		1,588		511		—		148		659
Loans to individuals	—		—		165		165		—		—		195		195
Lease financings	1,542		—		848		2,390		1,599		—		256		1,855
Total	$	27,559	$	766	$	1,224	$	29,549	$	14,517	$	11,435	$	761	$	26,713

* Includes nonaccrual troubled debt restructured loans and lease modifications of $1.3 million and $2.5 million at September 30, 2018 and December 31, 2017, respectively.

Accruing troubled debt restructuring loans of $11.4 million at December 31, 2017 includes balances of $10.3 million related to one borrower which were classified as troubled debt restructurings as the related loans were granted amortization period extensions. These troubled debt restructured loans were returned to performing status during the first quarter of 2018 as the borrower was in compliance with the modified terms of the restructurings for the required time period. At September 30, 2018, commercial real estate nonaccrual loans and leases includes an $11.8 million loan that was placed on nonaccrual status during the first quarter of 2018. A specific reserve of $645 thousand was recorded for this loan as of September 30, 2018.

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, 2018 and December 31, 2017.

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. Loans with a relationship balance of less than $1 million are reviewed on a performance basis, with the primary monitored metrics being delinquency (60 days or more past due) and revolving stagnancy. Loans with relationships greater than $1 million are reviewed at least annually. Loan relationships exceeding $15 million or classified as special mention or substandard are reviewed at least quarterly, or more frequently based on management’s discretion.


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, 2018
Grade:
1. Cash secured/ 2. Fully secured	$	2,789	$	—	$	23,290	$	—	$	26,079
3. Strong	14,369		699		—		—		15,068
4. Satisfactory	18,511		24,325		—		265		43,101
5. Acceptable	575,671		1,072,909		77,773		236,261		1,962,614
6. Pre-watch	222,325		287,933		86,326		38,090		634,674
7. Special Mention	26,323		35,402		1,400		2,203		65,328
8. Substandard	7,648		21,413		106		2,981		32,148
9. Doubtful	—		—		—		—		—
10.Loss	—		—		—		—		—
Total	$	867,636	$	1,442,681	$	188,895	$	279,800	$	2,779,012
At December 31, 2017
Grade:
1. Cash secured/ 2. Fully secured	$	2,521	$	—	$	20,420	$	—	$	22,941
3. Strong	9,206		1,821		—		—		11,027
4. Satisfactory	30,283		26,950		—		274		57,507
5. Acceptable	593,205		960,258		76,899		215,750		1,846,112
6. Pre-watch	179,990		209,844		72,168		29,738		491,740
7. Special Mention	4,027		12,974		1,392		296		18,689
8. Substandard	13,868		23,834		365		4,742		42,809
9. Doubtful	—		—		—		—		—
10.Loss	—		—		—		—		—
Total	$	833,100	$	1,235,681	$	171,244	$	250,800	$	2,490,825

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, 2018
Grade:
1. Cash secured/ 2. Fully secured	$	—	$	—	$	—	$	—	$	—
3. Strong	—		—		—		—		—
4. Satisfactory	—		—		—		—		—
5. Acceptable	23,085		155,221		—		56,107		234,413
6. Pre-watch	2,475		81,048		3,742		9,115		96,380
7. Special Mention	838		4,421		—		—		5,259
8. Substandard	288		13,772		—		1,309		15,369
9. Doubtful	—		—		—		—		—
10.Loss	—		—		—		—		—
Total	$	26,686	$	254,462	$	3,742	$	66,531	$	351,421
December 31, 2017
Grade:
1. Cash secured/ 2. Fully secured	$	1,120	$	—	$	—	$	—	$	1,120
3. Strong	—		—		—		—		—
4. Satisfactory	125		482		—		—		607
5. Acceptable	49,949		183,490		—		73,402		306,841
6. Pre-watch	6,183		98,977		4,592		15,861		125,613
7. Special Mention	1,007		17,028		—		—		18,035
8. Substandard	4,727		6,483		—		1,904		13,114
9. Doubtful	—		—		—		—		—
10.Loss	—		—		—		—		—
Total	$	63,111	$	306,460	$	4,592	$	91,167	$	465,330

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, 2018
Performing	$	327,138	$	177,115	$	31,931	$	133,618	$	669,802
Nonperforming	695		517		165		2,390		3,767
Total	$	327,833	$	177,632	$	32,096	$	136,008	$	673,569
At December 31, 2017
Performing	$	260,589	$	171,527	$	27,961	$	127,913	$	587,990
Nonperforming	65		357		195		1,855		2,472
Total	$	260,654	$	171,884	$	28,156	$	129,768	$	590,462

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, 2018
Performing	$	51,556	$	8,278	$	142	$	—	$	59,976
Nonperforming	1,120		1,071		—		—		2,191
Total	$	52,676	$	9,349	$	142	$	—	$	62,167
At December 31, 2017
Performing	$	60,477	$	12,084	$	144	$	—	$	72,705
Nonperforming	443		302		—		—		745
Total	$	60,920	$	12,386	$	144	$	—	$	73,450

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, 2018 and 2017:



(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, 2018
Reserve for loan and lease losses:
Beginning balance	$	7,258		$	12,327		$	2,004		$	2,494		$	447		$	1,071		$	51		$	25,652
Charge-offs	(904		)	—			(30		)	—			(82		)	(123		)	N/A			(1,139		)
Recoveries	22			1			8			6			25			51			N/A			113
Provision	813			906			72			527			82			138			206			2,744
Provision for acquired credit impaired loans	—			—			—			1			—			—			—			1
Ending balance	$	7,189		$	13,234		$	2,054		$	3,028		$	472		$	1,137		$	257		$	27,371
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
Nine Months Ended September 30, 2018
Reserve for loan and lease losses:
Beginning balance	$	6,742		$	9,839		$	1,661		$	1,754		$	373		$	1,132		$	54		$	21,555
Charge-offs	(14,553		)	(40		)	(30		)	—			(253		)	(428		)	N/A			(15,304		)
Recoveries	271			74			266			71			71			160			N/A			913
Provision	14,729			3,361			157			1,201			281			273			203			20,205
Provision for acquired credit impaired loans	—			—			—			2			—			—			—			2
Ending balance	$	7,189		$	13,234		$	2,054		$	3,028		$	472		$	1,137		$	257		$	27,371
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

N/A – Not applicable

Charge-offs for the nine months ended September 30, 2018 include a charge-off of $12.7 million during the second quarter of 2018 for a commercial loan relationship related to alleged fraudulent activities perpetrated by one or more employees of the borrower. The Bank owned a participating interest which originally totaled $13.0 million in an approximately $80.0 million commercial lending facility. The charge-off represents the entire principal amount owed to the Bank.

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, 2018 and 2017:



(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, 2018
Reserve for loan and lease losses:
Ending balance: individually evaluated for impairment	$	211	$	645	$	—	$	192	$	—	$	—	N/A		$	1,048
Ending balance: collectively evaluated for impairment	6,978		12,504		2,014		2,836		472		1,137		257		26,198
Ending balance: acquired credit impaired loans evaluated for impairment	—		85		40		—		—		—		—		125
Total ending balance	$	7,189	$	13,234	$	2,054	$	3,028	$	472	$	1,137	$	257	$	27,371
Loans and leases held for investment:
Ending balance: individually evaluated for impairment	$	4,889	$	18,970	$	1,588	$	3,275	$	—	$	1,250			$	29,972
Ending balance: collectively evaluated for impairment	862,747		1,610,805		278,212		502,190		32,096		134,758				3,420,808
Loans measured at fair value	—		1,801		—		—		—		—				1,801
Acquired non-credit impaired loans	26,504		257,998		66,083		61,961		142		—				412,688
Acquired credit impaired loans	182		206		448		64		—		—				900
Total ending balance	$	894,322	$	1,889,780	$	346,331	$	567,490	$	32,238	$	136,008			$	3,866,169
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

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 (excludes Lease Financings)

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, 2018 and December 31, 2017. The impaired loans exclude acquired credit impaired loans.



	At September 30, 2018						At December 31, 2017
(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	$	3,958	$	4,535			$	7,019	$	8,301
Real estate—commercial real estate	7,110		7,976				15,621		16,507
Real estate—construction	106		111				365		365
Real estate—residential secured for business purpose	1,588		1,776				3,430		4,620
Real estate—residential secured for personal purpose	1,091		1,142				508		566
Real estate—home equity secured for personal purpose	1,460		1,488				511		523
Total impaired loans with no related reserve recorded	$	15,313	$	17,028			$	27,454	$	30,882
Impaired loans with a reserve recorded:
Commercial, financial and agricultural	$	931	$	984	$	211	$	60	$	60	$	31
Real estate—commercial real estate	11,754		12,138		645		933		933		99
Real estate—residential secured for business purpose	—		—		—		35		37		1
Real estate—residential secured for personal purpose	724		724		192		—		—		—
Total impaired loans with a reserve recorded	$	13,409	$	13,846	$	1,048	$	1,028	$	1,030	$	131



Total impaired loans:
Commercial, financial and agricultural	$	4,889	$	5,519	$	211	$	7,079	$	8,361	$	31
Real estate—commercial real estate	18,864		20,114		645		16,554		17,440		99
Real estate—construction	106		111		—		365		365		—
Real estate—residential secured for business purpose	1,588		1,776		—		3,465		4,657		1
Real estate—residential secured for personal purpose	1,815		1,866		192		508		566		—
Real estate—home equity secured for personal purpose	1,460		1,488		—		511		523		—
Total impaired loans	$	28,722	$	30,874	$	1,048	$	28,482	$	31,912	$	131

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 original 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 $1.9 million and $4.1 million at September 30, 2018 and December 31, 2017, respectively. Specific reserves on other accruing impaired loans were $0 thousand and $99 thousand at September 30, 2018 and December 31, 2017, 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, 2018						Three Months Ended September 30, 2017
(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	$	5,671	$	31	$	58	$	10,211	$	52	$	92
Real estate—commercial real estate	19,878		22		261		18,583		201		69
Real estate—construction	108		—		2		365		—		5
Real estate—residential secured for business purpose	1,844		4		32		3,579		16		34
Real estate—residential secured for personal purpose	1,850		—		26		635		1		8
Real estate—home equity secured for personal purpose	1,507		—		21		288		—		5
Total	$	30,858	$	57	$	400	$	33,661	$	270	$	213


*	Includes interest income recognized on a cash basis for nonaccrual loans of $5 thousand and $0 thousand for the three months ended September 30, 2018 and 2017, respectively, and interest income recognized on the accrual method for accruing impaired loans of $52 thousand and $270 thousand for the three months ended September 30, 2018 and 2017, respectively.



	Nine Months Ended September 30, 2018						Nine Months Ended September 30, 2017
(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	$	6,589	$	103	$	269	$	11,030	$	162	$	263
Real estate—commercial real estate	19,935		212		813		21,120		618		223
Real estate—construction	128		—		7		219		—		15
Real estate—residential secured for business purpose	2,018		14		79		4,053		53		139
Real estate—residential secured for personal purpose	1,064		3		70		629		2		31
Real estate—home equity secured for personal purpose	1,026		—		60		391		—		15
Total	$	30,760	$	332	$	1,298	$	37,442	$	835	$	686


*	Includes interest income recognized on a cash basis for nonaccrual loans of $13 thousand and $4 thousand for the nine months ended September 30, 2018 and 2017, respectively, and interest income recognized on the accrual method for accruing impaired loans of $319 thousand and $831 thousand for the nine months ended September 30, 2018 and 2017, respectively.

Impaired Leases

The Corporation had impaired leases of $1.3 million at September 30, 2018 and December 31, 2017 with no related reserves. See discussion in Reserve for Loan and Lease Losses and Recorded Investment in 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, 2018

Three Months Ended September 30, 2017

(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:

Total

—



	Nine Months Ended September 30, 2018							Nine Months Ended September 30, 2017
(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:
Real estate—commercial real estate	—	$	—	$	—	$	—	3	$	9,206	$	9,206	$	—
Total	—	$	—	$	—	$	—	3	$	9,206	$	9,206	$	—
Nonaccrual Troubled Debt Restructured Loans:
Real estate—commercial real estate	—	$	—	$	—	$	—	1	$	328	$	328	$	—
Real estate—residential secured for personal purpose	1	66		66		—		—	—		—		—
Total	1	$	66	$	66	$	—	1	$	328	$	328	$	—

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, 2018 and 2017.



	Maturity Date Extension			Amortization Period Extension			Total Concessions Granted
(Dollars in thousands)	No. of Loans	Amount		No. of Loans	Amount		No. of Loans	Amount
Three Months Ended September 30, 2018
Accruing Troubled Debt Restructured Loans:
Total	—	$	—	—	$	—	—	$	—
Nonaccrual Troubled Debt Restructured Loans:
Total	—	$	—	—	$	—	—	$	—
Three Months Ended September 30, 2017
Accruing Troubled Debt Restructured Loans:
Total	—	$	—	—	$	—	—	$	—
Nonaccrual Troubled Debt Restructured Loans:
Total	—	$	—	—	$	—	—	$	—
Nine Months Ended September 30, 2018
Accruing Troubled Debt Restructured Loans:
Total	—	$	—	—	$	—	—	$	—
Nonaccrual Troubled Debt Restructured Loans:
Real estate—residential secured for personal purpose	—	$	—	1	$	66	1	$	66
Total	—	$	—	1	$	66	1	$	66
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

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,
	2018			2017			2018			2017
(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:
Commercial, financial and agricultural	—	$	—	—	$	—	1	$	953	—	$	—
Total	—	$	—	—	$	—	1	$	953	—	$	—

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, 2018 and December 31, 2017:



(Dollars in thousands)	At September 30, 2018		At December 31, 2017
Real estate-residential secured for personal purpose	$	—	$	31
Real estate-home equity secured for personal purpose	812		—
Total	$	812	$	31

The following presents foreclosed residential real estate property included in other real estate owned at September 30, 2018 and December 31, 2017.



(Dollars in thousands)	At September 30, 2018		At December 31, 2017
Foreclosed residential real estate	$	57	$	80