Allowance for Loan Losses

9 Months Ended

Sep. 30, 2014

Receivables [Abstract]

Allowance for Loan Losses

Note 5 - Allowance for Loan Losses

The following tables summarize the activity in the allowance for loan losses, and ending balance of loans, net of unearned fees for the periods indicated.

	Allowance for Loan Losses – Three Months Ended September 30, 2014
	RE Mortgage						Home Equity						Auto			Other						Construction
(in thousands)	Resid.			Comm.			Lines			Loans			Indirect			Consum.			C&I			Resid.			Comm.			Total
Beginning balance	$	2,832		$	9,831		$	18,055		$	1,411		$	28		$	556		$	4,407		$	1,511		$	1,337		$	39,968
Charge-offs		(31	)		(49	)		(136	)		—			—			(118	)		(11	)		—			—			(345	)
Recoveries		—			42			249			4			19			71			94			769			26			1,274
(Benefit) provision		51			(53	)		(1,239	)		229			(31	)		160			(428	)		(702	)		(964	)		(2,977	)
Ending balance	$	2,852		$	9,771		$	16,929		$	1,644		$	16		$	669		$	4,062		$	1,578		$	399		$	37,920
	Allowance for Loan Losses – Nine Months Ended September 30, 2014
	RE Mortgage						Home Equity						Auto			Other						Construction
(in thousands)	Resid.			Comm.			Lines			Loans			Indirect			Consum.			C&I			Resid.			Comm.			Total
Beginning balance	$	3,154		$	9,700		$	16,375		$	1,208		$	66		$	589		$	4,331		$	1,559		$	1,263		$	38,245
Charge-offs		(167	)		(107	)		(991	)		(11	)		—			(389	)		(401	)		(4	)		(69	)		(2,139	)
Recoveries		—			513			758			31			70			373			1,155			1,377			161			4,438
(Benefit) provision		(135	)		(335	)		787			416			(120	)		96			(1,023	)		(1,354	)		(956	)		(2,624	)
Ending balance	$	2,852		$	9,771		$	16,929		$	1,644		$	16		$	669		$	4,062		$	1,578		$	399		$	37,920
Ending balance:
Individ. evaluated for impairment	$	902		$	413		$	2,001		$	213			—		$	69		$	433		$	60			—		$	4,091
Loans pooled for evaluation	$	1,765		$	9,182		$	14,428		$	1,431		$	16		$	600		$	2,354		$	349		$	295		$	30,420
Loans acquired with deteriorated credit quality	$	185		$	176		$	500			—			—			—		$	1,275		$	1,169		$	104		$	3,409
	Loans, net of unearned fees – As of September 30, 2014
	RE Mortgage						Home Equity						Auto			Other						Construction
(in thousands)	Resid.			Comm.			Lines			Loans			Indirect			Consum.			C&I			Resid.			Comm.			Total
Ending balance:
Total loans	$	228,407		$	985,746		$	321,942		$	22,378		$	212		$	29,088		$	135,085		$	24,386		$	18,627		$	1,765,871
Individ. evaluated for impairment	$	7,142		$	50,322		$	6,733		$	896		$	23		$	194		$	1,902		$	2,720		$	114		$	70,046
Loans pooled for evaluation	$	217,478		$	908,725		$	306,006		$	20,866		$	189		$	28,830		$	127,363		$	20,140		$	18,439		$	1,648,036
Loans acquired with deteriorated credit quality	$	3,787		$	26,699		$	9,203		$	616			—		$	64		$	5,820		$	1,526		$	74		$	47,789
	Allowance for Loan Losses – Year Ended December 31, 2013
	RE Mortgage						Home Equity						Auto			Other						Construction
(in thousands)	Resid.			Comm.			Lines			Loans			Indirect			Consum.			C&I			Resid.			Comm.			Total
Beginning balance	$	3,523		$	8,782		$	21,367		$	1,155		$	243		$	696		$	4,703		$	1,400		$	779		$	42,648
Charge-offs		(46	)		(2,038	)		(2,651	)		(94	)		(68	)		(887	)		(1,599	)		(20	)		(140	)		(7,543	)
Recoveries		345			994			1,053			41			195			759			340			63			65			3,855
(Benefit) provision		(668	)		1,962			(3,394	)		106			(304	)		21			887			116			559			(715	)
Ending balance	$	3,154		$	9,700		$	16,375		$	1,208		$	66		$	589		$	4,331		$	1,559		$	1,263		$	38,245
Ending balance:
Individ. evaluated for impairment	$	775		$	1,198		$	1,140		$	169		$	1		$	8		$	585		$	91		$	8		$	3,975
Loans pooled for evaluation	$	2,039		$	7,815		$	14,749		$	1,039		$	65		$	581		$	2,402		$	751		$	789		$	30,230
Loans acquired with deteriorated credit quality	$	340		$	687		$	486			—			—			—		$	1,344		$	717		$	466		$	4,040

	Loans, net of unearned fees – As of December 31, 2013
	RE Mortgage						Home Equity						Auto			Other						Construction
(in thousands)	Resid.			Comm.			Lines			Loans			Indirect			Consum.			C&I			Resid.			Comm.			Total
Ending balance:
Total loans	$	195,013		$	912,850		$	339,866		$	14,588		$	946		$	27,763		$	131,878		$	31,933		$	17,170		$	1,672,007
Individ. evaluated for impairment	$	7,342		$	59,936		$	6,918		$	778		$	60		$	90		$	3,177		$	2,756		$	178		$	81,235
Loans pooled for evaluation	$	183,015		$	822,654		$	322,865		$	13,324		$	886		$	27,592		$	122,166		$	27,611		$	16,947		$	1,537,060
Loans acquired with deteriorated credit quality	$	4,656		$	30,260		$	10,083		$	486			—		$	81		$	6,535		$	1,566		$	45		$	53,712
	Allowance for Loan Losses – Three months ended September 30, 2013
	RE Mortgage						Home Equity						Auto			Other						Construction
(In thousands)	Resid.			Comm.			Lines			Loans			Indirect			Consum.			C&I			Resid.			Comm.			Total
Beginning balance	$	3,231		$	8,764		$	18,710		$	1,109		$	114		$	567		$	4,929		$	1,288		$	887		$	39,599
Charge-offs		(4	)		(23	)		(331	)		(30	)		(9	)		(239	)		(318	)		—			(31	)		(985	)
Recoveries		154			295			304			3			34			199			108			2			20			1,119
(Benefit) provision		(190	)		704			(871	)		(50	)		(58	)		7			(234	)		157			142			(393	)
Ending balance	$	3,191		$	9,740		$	17,812		$	1,032		$	81		$	534		$	4,485		$	1,447		$	1,018		$	39,340
	Allowance for Loan Losses – As of and nine months ended September 30, 2013
	RE Mortgage						Home Equity						Auto			Other						Construction
(In thousands)	Resid.			Comm.			Lines			Loans			Indirect			Consum.			C&I			Resid.			Comm.			Total
Beginning balance	$	3,523		$	8,782		$	21,367		$	1,155		$	243		$	696		$	4,703		$	1,400		$	779		$	42,648
Charge-offs		(46	)		(1,712	)		(1,843	)		(56	)		(67	)		(724	)		(1,143	)		(20	)		(92	)		(5,703	)
Recoveries		345			965			809			29			180			601			244			63			46			3,282
(Benefit) provision		(631	)		1,705			(2,521	)		(96	)		(275	)		(39	)		681			4			285			(887	)
Ending balance	$	3,191		$	9,740		$	17,812		$	1,032		$	81		$	534		$	4,485		$	1,447		$	1,018		$	39,340
Ending balance:
Individ. evaluated for impairment	$	623		$	1,446		$	1,554		$	49		$	2		$	6		$	678		$	91		$	9		$	4,458
Loans pooled for evaluation	$	2,235		$	7,748		$	15,259		$	983		$	79		$	521		$	2,448		$	723		$	653		$	30,649
Loans acquired with deteriorated credit quality	$	333		$	546		$	999			—			—		$	7		$	1,359		$	633		$	356		$	4,233
	Loans, net of unearned fees – As of September 30, 2013
	RE Mortgage						Home Equity						Auto			Other						Construction
(In thousands)	Resid.			Comm.			Lines			Loans			Indirect			Consum.			C&I			Resid.			Comm.			Total
Ending balance:
Total loans	$	197,129		$	894,346		$	346,348		$	13,730		$	1,351		$	28,282		$	133,616		$	27,601		$	14,648		$	1,657,051
Individ. evaluated for impairment	$	7,013		$	69,373		$	7,664		$	551		$	66		$	94		$	3,333		$	2,872		$	252		$	91,218
Loans pooled for evaluation	$	183,769		$	794,301		$	328,215		$	12,575		$	1,285		$	28,113		$	123,476		$	23,497		$	13,822		$	1,509,053
Loans acquired with deteriorated credit quality	$	6,347		$	30,672		$	10,469		$	604			—		$	75		$	6,807		$	1,232		$	574		$	56,780

As part of the on-going monitoring of the credit quality of the Company’s loan portfolio, management tracks certain credit quality indicators including, but not limited to, trends relating to (i) the level of criticized and classified loans, (ii) net charge-offs, (iii) non-performing loans, and (iv) delinquency within the portfolio.

The Company utilizes a risk grading system to assign a risk grade to each of its loans. Loans are graded on a scale ranging from Pass to Loss. A description of the general characteristics of the risk grades is as follows:

• Pass – This grade represents loans ranging from acceptable to very little or no credit risk. These loans typically meet most if not all policy standards in regard to: loan amount as a percentage of collateral value, debt service coverage, profitability, leverage, and working capital.

• Special Mention – This grade represents “Other Assets Especially Mentioned” in accordance with regulatory guidelines and includes loans that display some potential weaknesses which, if left unaddressed, may result in deterioration of the repayment prospects for the asset or may inadequately protect the Company’s position in the future. These loans warrant more than normal supervision and attention.

• Substandard – This grade represents “Substandard” loans in accordance with regulatory guidelines. Loans within this rating typically exhibit weaknesses that are well defined to the point that repayment is jeopardized. Loss potential is, however, not necessarily evident. The underlying collateral supporting the credit appears to have sufficient value to protect the Company from loss of principal and accrued interest, or the loan has been written down to the point where this is true. There is a definite need for a well defined workout/rehabilitation program.

• Doubtful – This grade represents “Doubtful” loans in accordance with regulatory guidelines. An asset classified as Doubtful has all the weaknesses inherent in a loan classified Substandard with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions and values, highly questionable and improbable. Pending factors include proposed merger, acquisition, or liquidation procedures, capital injection, perfecting liens on additional collateral, and financing plans.

• Loss – This grade represents “Loss” loans in accordance with regulatory guidelines. A loan classified as Loss is considered uncollectible and of such little value that its continuance as a bankable asset is not warranted. This classification does not mean that the loan has absolutely no recovery or salvage value, but rather that it is not practical or desirable to defer writing off the loan, even though some recovery may be affected in the future. The portion of the loan that is graded loss should be charged off no later than the end of the quarter in which the loss is identified.

The following tables present ending loan balances by loan category and risk grade for the periods indicated:

	Credit Quality Indicators – As of September 30, 2014
	RE Mortgage				Home Equity				Auto		Other				Construction
(in thousands)	Resid.		Comm.		Lines		Loans		Indirect		Consum.		C&I		Resid.		Comm.		Total
Originated loans:
Pass	$	133,922	$	857,171	$	288,680	$	19,402	$	145	$	26,639	$	126,554	$	19,565	$	18,380	$	1,490,458
Special mention		832		13,626		3,290		767		20		347		1,131		858		34		20,905
Substandard		7,100		36,180		9,025		1,440		47		215		1,106		2,437		139		57,689
Loss
Total originated	$	141,854	$	906,977	$	300,995	$	21,609	$	212	$	27,201	$	128,791	$	22,860	$	18,553	$	1,569,052
PNCI loans:
Pass	$	82,180	$	44,652	$	10,879	$	153		—	$	1,719	$	195		—		—	$	139,778
Special mention		—		4,697		229		—		—		38		279		—		—		5,243
Substandard		586		2,721		636		—		—		66		—		—		—		4,009
Total PNCI	$	82,766	$	52,070	$	11,744	$	153		—	$	1,823	$	474		—		—	$	149,030
PCI loans	$	3,787	$	26,699	$	9,203	$	616		—	$	64	$	5,820	$	1,526	$	74	$	47,789
Total loans	$	228,407	$	985,746	$	321,942	$	22,378	$	212	$	29,088	$	135,085	$	24,386	$	18,627	$	1,765,871
	Credit Quality Indicators – As of December 31, 2013
	RE Mortgage				Home Equity				Auto		Other				Construction
(in thousands)	Resid.		Comm.		Lines		Loans		Indirect		Consum.		C&I		Resid.		Comm.		Total
Originated loans:
Pass	$	121,969	$	768,596	$	302,232	$	12,284	$	717	$	24,653	$	121,580	$	25,836	$	16,571	$	1,394,438
Special mention		1,265		15,862		4,529		504		118		756		938		96		343		24,411
Substandard		6,648		40,454		9,446		1,061		111		196		2,122		4,435		211		64,684
Loss		—		—		—		—		—		3		10		—		—		13
Total originated	$	129,882	$	824,912	$	316,207	$	13,849	$	946	$	25,608	$	124,650	$	30,367	$	17,125	$	1,483,546
PNCI loans:
Pass	$	59,798	$	48,548	$	12,716	$	253		—	$	2,020	$	380		—		—	$	123,715
Special mention		—		5,810		195		—		—		18		313		—		—		6,336
Substandard		677		3,320		665		—		—		36		—		—		—		4,698
Total PNCI	$	60,475	$	57,678	$	13,576	$	253		—	$	2,074	$	693		—		—	$	134,749
PCI loans	$	4,656	$	30,260	$	10,083	$	486		—	$	81	$	6,535	$	1,566	$	45	$	53,712
Total loans	$	195,013	$	912,850	$	339,866	$	14,588	$	946	$	27,763	$	131,878	$	31,933	$	17,170	$	1,672,007

Consumer loans, whether unsecured or secured by real estate, automobiles, or other personal property, are susceptible to three primary risks; non-payment due to income loss, over-extension of credit and, when the borrower is unable to pay, shortfall in collateral value. Typically non-payment is due to loss of job and will follow general economic trends in the marketplace driven primarily by rises in the unemployment rate. Loss of collateral value can be due to market demand shifts, damage to collateral itself or a combination of the two.

Problem consumer loans are generally identified by payment history of the borrower (delinquency). The Bank manages its consumer loan portfolios by monitoring delinquency and contacting borrowers to encourage repayment, suggest modifications if appropriate, and, when continued scheduled payments become unrealistic, initiate repossession or foreclosure through appropriate channels. Collateral values may be determined by appraisals obtained through Bank approved, licensed appraisers, qualified independent third parties, public value information (blue book values for autos), sales invoices, or other appropriate means. Appropriate valuations are obtained at initiation of the credit and periodically (every 3-12 months depending on collateral type) once repayment is questionable and the loan has been classified.

Commercial real estate loans generally fall into two categories, owner-occupied and non-owner occupied. Loans secured by owner occupied real estate are primarily susceptible to changes in the business conditions of the related business. This may be driven by, among other things, industry changes, geographic business changes, changes in the individual fortunes of the business owner, and general economic conditions and changes in business cycles. These same risks apply to commercial loans whether secured by equipment or other personal property or unsecured. Losses on loans secured by owner occupied real estate, equipment, or other personal property generally are dictated by the value of underlying collateral at the time of default and liquidation of the collateral. When default is driven by issues related specifically to the business owner, collateral values tend to provide better repayment support and may result in little or no loss. Alternatively, when default is driven by more general economic conditions, underlying collateral generally has devalued more and results in larger losses due to default. Loans secured by non-owner occupied real estate are primarily susceptible to risks associated with swings in occupancy or vacancy and related shifts in lease rates, rental rates or room rates. Most often these shifts are a result of changes in general economic or market conditions or overbuilding and resultant over-supply. Losses are dependent on value of underlying collateral at the time of default. Values are generally driven by these same factors and influenced by interest rates and required rates of return as well as changes in occupancy costs.

Construction loans, whether owner occupied or non-owner occupied commercial real estate loans or residential development loans, are not only susceptible to the related risks described above but the added risks of construction itself including cost over-runs, mismanagement of the project, or lack of demand or market changes experienced at time of completion. Again, losses are primarily related to underlying collateral value and changes therein as described above.

Problem C&I loans are generally identified by periodic review of financial information which may include financial statements, tax returns, rent rolls and payment history of the borrower (delinquency). Based on this information the Bank may decide to take any of several courses of action including demand for repayment, additional collateral or guarantors, and, when repayment becomes unlikely through borrower’s income and cash flow, repossession or foreclosure of the underlying collateral.

Collateral values may be determined by appraisals obtained through Bank approved, licensed appraisers, qualified independent third parties, public value information (blue book values for autos), sales invoices, or other appropriate means. Appropriate valuations are obtained at initiation of the credit and periodically (every 3-12 months depending on collateral type) once repayment is questionable and the loan has been classified.

Once a loan becomes delinquent and repayment becomes questionable, a Bank collection officer will address collateral shortfalls with the borrower and attempt to obtain additional collateral. If this is not forthcoming and payment in full is unlikely, the Bank will estimate its probable loss, using a recent valuation as appropriate to the underlying collateral less estimated costs of sale, and charge the loan down to the estimated net realizable amount. Depending on the length of time until ultimate collection, the Bank may revalue the underlying collateral and take additional charge-offs as warranted. Revaluations may occur as often as every 3-12 months depending on the underlying collateral and volatility of values. Final charge-offs or recoveries are taken when collateral is liquidated and actual loss is known. Unpaid balances on loans after or during collection and liquidation may also be pursued through lawsuit and attachment of wages or judgment liens on borrower’s other assets.

The following table shows the ending balance of current, past due, and nonaccrual originated loans by loan category as of the date indicated:

	Analysis of Past Due and Nonaccrual Originated Loans – As of September 30, 2014
	RE Mortgage				Home Equity				Auto		Other				Construction
(in thousands)	Resid.		Comm.		Lines		Loans		Indirect		Consum.		C&I		Resid.		Comm.		Total
Originated loan balance:
Past due:
30-59 Days	$	112	$	933	$	1,692	$	202	$	2	$	81	$	414		—		—	$	3,436
60-89 Days		509		205		514		208		1		11		27		—		—		1,475
> 90 Days		591		1,490		521		127		20		10		99		—		102		2,960
Total past due	$	1,212	$	2,628	$	2,727	$	537	$	23	$	102	$	540		—	$	102	$	7,871
Current		140,642		904,349		298,268		21,072		189		27,099		128,251		22,860		18,451		1,561,181
Total orig. loans	$	141,854	$	906,977	$	300,995	$	21,609	$	212	$	27,201	$	128,791	$	22,860	$	18,553	$	1,569,052
> 90 Days and still accruing		—	$	360		—		—		—		—		—		—		—	$	360
Nonaccrual loans	$	4,018	$	21,471	$	4,257	$	838	$	23	$	19	$	312	$	2,437	$	114	$	33,489

The following table shows the ending balance of current, past due, and nonaccrual PNCI loans by loan category as of the date indicated:

	Analysis of Past Due and Nonaccrual PNCI Loans – As of September 30, 2014
	RE Mortgage				Home Equity				Auto		Other				Construction
(in thousands)	Resid.		Comm.		Lines		Loans		Indirect		Consum.		C&I		Resid.		Comm.		Total
PNCI loan balance:
Past due:
30-59 Days	$	192		—		—		—		—		—		—		—		—	$	192
60-89 Days		1,208		—		—		—		—		—		—		—		—		1,208
> 90 Days		—		—		36		—		—		—		—		—		—		36
Total past due	$	1,400		—	$	36		—		—		—		—		—		—	$	1,436
Current		81,366		52,070		11,708		153		—		1,823		474		—		—		147,594
Total PNCI loans	$	82,766	$	52,070	$	11,744	$	153		—	$	1,823	$	474		—		—	$	149,030
> 90 Days and still accruing		—		—		—		—		—		—		—		—		—		—
Nonaccrual loans	$	349	$	419	$	314		—		—	$	31		—		—		—	$	1,113
The following table shows the ending balance of current, past due, and nonaccrual originated loans by loan category as of the date indicated:
	Analysis of Past Due and Nonaccrual Originated Loans – As of December 31, 2013
	RE Mortgage				Home Equity				Auto		Other				Construction
(in thousands)	Resid.		Comm.		Lines		Loans		Indirect		Consum.		C&I		Resid.		Comm.		Total
Originated loan balance:
Past due:
30-59 Days	$	2,272	$	2,304	$	3,121	$	264	$	24	$	40	$	296		—		—	$	8,321
60-89 Days		284		—		1,070		16		1		16		76		—	$	198		1,661
> 90 Days		447		2,213		1,050		312		33		7		749	$	13		—		4,824
Total past due	$	3,003	$	4,517	$	5,241	$	592	$	58	$	63	$	1,121	$	13	$	198	$	14,806
Current		126,879		820,395		310,966		13,257		888		25,545		123,529		30,354		16,927		1,468,740
Total orig. loans	$	129,882	$	824,912	$	316,207	$	13,849	$	946		25,608	$	124,650	$	30,367	$	17,125	$	1,483,546
> 90 Days and still accruing		—		—		—		—		—		—		—		—		—		—
Nonaccrual loans	$	4,697	$	30,732	$	4,972	$	719	$	54	$	26	$	1,280	$	2,473	$	178	$	45,131
The following table shows the ending balance of current, past due, and nonaccrual PNCI loans by loan category as of the date indicated:
	Analysis of Past Due and Nonaccrual PNCI Loans – As of December 31, 2013
	RE Mortgage				Home Equity				Auto		Other				Construction
(in thousands)	Resid.		Comm.		Lines		Loans		Indirect		Consum.		C&I		Resid.		Comm.		Total
PNCI loan balance:
Past due:
30-59 Days	$	799	$	512	$	313		—		—	$	49		—		—		—	$	1,673
60-89 Days		—		352		38		—		—		—		—		—		—		390
> 90 Days		—		217		—		—		—		—		—		—		—		217
Total past due	$	799	$	1,081	$	351		—		—	$	49		—		—		—	$	2,280
Current		59,676		56,597		13,225	$	253		—		2,025	$	693		—		—		132,469
Total PNCI loans	$	60,475	$	57,678	$	13,576	$	253		—	$	2,074	$	693		—		—	$	134,749
> 90 Days and still accruing		—		—		—		—		—		—		—		—		—		—
Nonaccrual loans	$	262	$	1,139	$	429		—		—	$	36		—		—		—	$	1,866

Impaired originated loans are those where management has concluded that it is probable that the borrower will be unable to pay all amounts due under the contractual terms.

The following tables show the recorded investment (financial statement balance), unpaid principal balance, average recorded investment, and interest income recognized for impaired Originated and PNCI loans, segregated by those with no related allowance recorded and those with an allowance recorded for the periods indicated.

	Impaired Originated Loans – As of, or for the Nine Months Ended, September 30, 2014
	RE Mortgage				Home Equity				Auto		Other				Construction
(in thousands)	Resid.		Comm.		Lines		Loans		Indirect		Consum.		C&I		Resid.		Comm.		Total
With no related allowance recorded:
Recorded investment	$	3,576	$	46,412	$	2,655	$	657	$	23	$	18	$	789	$	2,437	$	114	$	56,681
Unpaid principal	$	5,671	$	49,609	$	5,645	$	1,082	$	60	$	25	$	806	$	6,686	$	198	$	69,782
Average recorded Investment	$	3,971	$	49,882	$	3,182	$	604	$	39	$	17	$	1,218	$	2,455	$	92	$	61,460
Interest income Recognized	$	29	$	999	$	14	$	1		—		—	$	37		—	$	3	$	1,083
With an allowance recorded:
Recorded investment	$	2,838	$	3,344	$	3,291	$	239		—		—	$	1,105	$	283		—	$	11,100
Unpaid principal	$	3,017	$	3,489	$	3,653	$	323		—		—	$	1,151	$	283		—	$	11,916
Related allowance	$	745	$	304	$	1,764	$	213		—		—	$	433	$	60		—	$	3,519
Average recorded Investment	$	2,734	$	4,320	$	3,035	$	233	$	2	$	5	$	1,311	$	283	$	55	$	11,978
Interest income Recognized	$	59	$	133	$	49	$	3		—		—	$	41	$	14		—	$	299
	Impaired PNCI Loans – As of, or for the Nine Months Ended, September 30, 2014
	RE Mortgage				Home Equity				Auto		Other				Construction
(in thousands)	Resid.		Comm.		Lines		Loans		Indirect		Consum.		C&I		Resid.		Comm.		Total
With no related allowance recorded:
Recorded investment	$	299	$	419	$	314		—		—	$	31	$	8		—		—	$	1,071
Unpaid principal	$	306	$	2,636	$	337		—		—	$	44	$	8		—		—	$	3,331
Average recorded Investment	$	224	$	779	$	270		—		—	$	34	$	10		—		—	$	1,317
Interest income Recognized	$	12		—		—		—		—		—	$	1		—		—	$	13
With an allowance recorded:
Recorded investment	$	429	$	147	$	473		—		—	$	145		—		—		—	$	1,194
Unpaid principal	$	442	$	147	$	473		—		—	$	145		—		—		—	$	1,207
Related allowance	$	158	$	109	$	237		—		—	$	69		—		—		—	$	573
Average recorded Investment	$	313	$	148	$	338		—		—	$	87		—		—		—	$	886
Interest income Recognized	$	6	$	6	$	16		—		—	$	8		—		—		—	$	36

	Impaired Originated Loans – As of, or for the Year Ended, December 31, 2013
	RE Mortgage				Home Equity				Auto		Other				Construction
(in thousands)	Resid.		Comm.		Lines		Loans		Indirect		Consum.		C&I		Resid.		Comm.		Total
With no related allowance recorded:
Recorded investment	$	4,366	$	53,352	$	3,710	$	552	$	55	$	16	$	1,648	$	2,473	$	69	$	66,241
Unpaid principal	$	6,489	$	58,894	$	7,299	$	1,249	$	123	$	21	$	1,665	$	6,611	$	138	$	82,489
Average recorded Investment	$	4,123	$	58,205	$	4,410	$	463	$	93	$	18	$	2,154	$	1,567	$	83	$	71,116
Interest income Recognized	$	336	$	3,361	$	352	$	36	$	12	$	1	$	113	$	108	$	7	$	4,326
With an allowance recorded:
Recorded investment	$	2,630	$	5,296	$	2,779	$	226	$	4	$	10	$	1,517	$	284	$	109	$	12,855
Unpaid principal	$	2,689	$	5,659	$	3,053	$	291	$	6	$	10	$	1,616	$	284	$	288	$	13,896
Related allowance	$	648	$	1,084	$	968	$	169	$	1	$	5	$	585	$	91	$	7	$	3,558
Average recorded Investment	$	2,245	$	6,077	$	3,064	$	141	$	12	$	7	$	1,817	$	1,499	$	188	$	15,050
Interest income Recognized	$	124	$	287	$	146	$	18	$	1	$	2	$	95	$	19	$	15	$	707
	Impaired PNCI Loans – As of, or for the Year Ended, December 31, 2013
	RE Mortgage				Home Equity				Auto		Other				Construction
(in thousands)	Resid.		Comm.		Lines		Loans		Indirect		Consum.		C&I		Resid.		Comm.		Total
With no related allowance recorded:
Recorded investment	$	148	$	1,139	$	227		—		—	$	36	$	12		—		—	$	1,562
Unpaid principal	$	158	$	3,323	$	287		—		—	$	45	$	12		—		—	$	3,825
Average recorded Investment	$	37	$	1,005	$	333		—		—	$	39	$	7		—		—	$	1,421
Interest income Recognized	$	11	$	233	$	21		—		—	$	5	$	1		—		—	$	271
With an allowance recorded:
Recorded investment	$	198	$	149	$	203		—		—	$	28		—		—		—	$	578
Unpaid principal	$	207	$	149	$	215		—		—	$	28		—		—		—	$	599
Related allowance	$	128	$	114	$	172		—		—	$	3		—		—		—	$	417
Average recorded Investment	$	275	$	250	$	162		—		—	$	29		—		—		—	$	716
Interest income Recognized	$	12	$	9	$	10		—		—	$	1		—		—		—	$	32
	Impaired Originated Loans – As of, or for the Nine Months Ended, September 30, 2013
	RE Mortgage				Home Equity				Auto		Other				Construction
(in thousands)	Resid.		Comm.		Lines		Loans		Indirect		Consum.		C&I		Resid.		Comm.		Total
With no related allowance recorded:
Recorded investment	$	4,195	$	61,418	$	3,938	$	442	$	61	$	19	$	1,161	$	2,588	$	68	$	73,890
Unpaid principal	$	6,320	$	67,314	$	7,445	$	1,131	$	135	$	32	$	1,182	$	7,345	$	68	$	90,972
Average recorded Investment	$	3,911	$	61,375	$	4,543	$	415	$	120	$	19	$	2,802	$	1,837	$	137	$	75,159
Interest income Recognized	$	246	$	2,644	$	268	$	21	$	10	$	2	$	61	$	81	$	1	$	3,334
With an allowance recorded:
Recorded investment	$	2,468	$	6,990	$	3,232	$	109	$	5	$	9	$	2,158	$	284	$	184	$	15,439
Unpaid principal	$	2,510	$	7,670	$	3,703	$	161	$	7	$	10	$	3,063	$	284	$	426	$	17,834
Related allowance	$	480	$	1,293	$	1,350	$	49	$	2	$	3	$	678	$	91	$	9	$	3,955
Average recorded Investment	$	2,304	$	5,568	$	3,722	$	126	$	19	$	12	$	2,519	$	1,438	$	242	$	15,950
Interest income Recognized	$	93	$	388	$	109	$	8		—	$	1	$	155	$	14	$	16	$	784

	Impaired PNCI Loans – As of, or for the Nine Months Ended, September 30, 2013
	RE Mortgage				Home Equity				Auto		Other				Construction
(in thousands)	Resid.		Comm.		Lines		Loans		Indirect		Consum.		C&I		Resid.		Comm.		Total
With no related allowance recorded:
Recorded investment		—	$	800	$	290		—		—	$	38	$	14		—		—	$	1,142
Unpaid principal		—	$	2,893	$	342		—		—	$	46	$	14		—		—	$	3,295
Average recorded Investment		—	$	1,088	$	367		—		—	$	30	$	4		—		—	$	1,489
Interest income Recognized		—	$	154	$	19		—		—	$	4		—		—		—	$	177
With an allowance recorded:
Recorded investment	$	350	$	165	$	204		—		—	$	28		—		—		—	$	747
Unpaid principal	$	366	$	165	$	214		—		—	$	28		—		—		—	$	773
Related allowance	$	193	$	133	$	179		—		—	$	10		—		—		—	$	515
Average recorded Investment	$	276	$	292	$	121		—		—	$	40		—		—		—	$	729
Interest income Recognized	$	18	$	7	$	9		—		—	$	1		—		—		—	$	35

At September 30, 2014, $53,102,000 of originated loans were TDRs and classified as impaired. The Company had obligations to lend $29,000 in additional funds on these TDRs as of September 30, 2014. At September 30, 2014, $1,344,000 of PNCI loans were TDRs and classified as impaired. The Company had no obligations to lend additional funds on these TDRs as of September 30, 2014.

At December 31, 2013, $56,739,000 of originated loans were TDRs and classified as impaired. The Company had obligations to lend $25,000 of additional funds on these TDRs as of December 31, 2013. At December 31, 2013, $901,000 of PNCI loans were TDRs and classified as impaired. The Company had no obligations to lend additional funds on these TDRs as of December 31, 2013.

At September 30, 2013, $54,551,000 of Originated loans were TDR and classified as impaired. The Company had obligations to lend $50,000 of additional funds on these TDR as of September 30, 2013. At September 30, 2013, $928,000 of PNCI loans and $87,000 of PCI loans were TDR and classified as impaired. The Company had no obligations to lend additional funds on these TDR as of September 30, 2013.

Modifications classified as TDRs can include one or a combination of the following: rate modifications, term extensions, interest only modifications, either temporary or long-term, payment modifications, and collateral substitutions/additions. For all new TDRs, an impairment analysis is conducted. If the loan is determined to be collateral dependent, any additional amount of impairment will be calculated based on the difference between estimated collectible value and the current carrying balance of the loan. This difference could result in an increased provision and is typically charged off. If the asset is determined not to be collateral dependent, the impairment is measured on the net present value difference between the expected cash flows of the restructured loan and the cash flows which would have been received under the original terms. The effect of this could result in a requirement for additional provision to the reserve. The effect of these required provisions for the period are indicated above. Typically if a TDR defaults during the period, the loan is then considered collateral dependent and, if it was not already considered collateral dependent, an appropriate provision will be reserved or charge will be taken. The additional provisions required resulting from default of previously modified TDR’s are noted above.

The following tables show certain information regarding TDRs that occurred during the periods indicated:

	TDR Information for the Three Months Ended September 30, 2014
	RE Mortgage				Home Equity				Auto		Other				Construction
(in thousands)	Resid.		Comm.		Lines		Loans		Indirect		Consum.		C&I		Resid.		Comm.		Total
Number		1		3		1		—		—		1		3		—		—		9
Pre-mod outstanding principal balance	$	48	$	1,156	$	198		—		—	$	147	$	94		—		—	$	1,643
Post-mod outstanding principal balance	$	50	$	1,059	$	200		—		—	$	147	$	95		—		—	$	1,551
Financial impact due to TDR taken as additional provision		—	$	4		—		—		—	$	66	$	34		—		—	$	104
Number that defaulted during the period		—		—		—		—		—		—		—		—		—		—
Recorded investment of TDRs that defaulted during the period		—		—		—		—		—		—		—		—		—		—
Financial impact due to the default of previous TDR taken as charge-offs or additional provisions		—		—		—		—		—		—		—		—		—		—

The following tables show certain information regarding Troubled Debt Restructurings (TDRs) that occurred during the periods indicated:

	TDR Information for the Nine Months Ended September 30, 2014
	RE Mortgage					Home Equity				Auto		Other					Construction
(in thousands)	Resid.			Comm.		Lines		Loans		Indirect		Consum.		C&I			Resid.		Comm.		Total
Number		4			7		4		1		—		1		6			1		1		25
Pre-mod outstanding principal balance	$	854		$	1,980	$	677	$	32		—	$	147	$	166		$	102	$	118	$	4,076
Post-mod outstanding principal balance	$	857		$	1,890	$	691	$	33		—	$	147	$	167		$	84	$	100	$	3,969
Financial impact due to TDR taken as additional provision	$	37		$	22		—		—		—	$	66	$	55			—		—	$	180
Number that defaulted during the period		1			2		—		—		—		—		1			—		—		4
Recorded investment of TDRs that defaulted during the period	$	152		$	423		—		—		—		—	$	116			—		—	$	691
Financial impact due to the default of previous TDR taken as charge-offs or additional provisions		—			—		—		—		—		—		($8	)		—		—		($8	)
	TDR Information for the Three Months Ended September 30, 2013
	RE Mortgage					Home Equity				Auto		Other					Construction
(in thousands)	Resid.			Comm.		Lines		Loans		Indirect		Consum.		C&I			Resid.		Comm.		Total
Number		4			1		3		—		—		—		5			—		—		13
Pre-mod outstanding principal balance	$	607		$	25	$	480		—		—		—	$	113			—		—	$	1,225
Post-mod outstanding principal balance	$	607		$	26	$	482		—		—		—	$	114			—		—	$	1,229
Financial impact due to TDR taken as additional provision		—		$	4	$	27		—		—		—	$	30			—		—	$	61
Number that defaulted during the period		—			3		2		—		—		—		—			—		—		5
Recorded investment of TDRs that defaulted during the period		—		$	674	$	100		—		—		—		—			—		—	$	774
Financial impact due to the default of previous TDR taken as charge-offs or additional provisions		—			—	$	7		—		—		—		—			—		—	$	7
	TDR Information for the Nine Months Ended September 30, 2013
	RE Mortgage					Home Equity				Auto		Other					Construction
(in thousands)	Resid.			Comm.		Lines		Loans		Indirect		Consum.		C&I			Resid.		Comm.		Total
Number		6			7		10		—		—		—		7			—		—		30
Pre-mod outstanding principal balance	$	1,039		$	4,580	$	1,062		—		—		—	$	221			—		—	$	6,902
Post-mod outstanding principal balance	$	1,043		$	4,581	$	1,069		—		—		—	$	222			—		—	$	6,915
Financial impact due to TDR taken as additional provision	$	151		$	26	$	220		—		—		—	$	88			—		—	$	485
Number that defaulted during the period		2			7		2		—		—		—		3			1		—		15
Recorded investment of TDRs that defaulted during the period	$	181		$	1,065	$	100		—		—		—	$	1,297		$	73		—	$	2,716
Financial impact due to the default of previous TDR taken as charge-offs or additional provisions	$	(3	)		—	$	7		—		—		—		—		$	5		—	$	9