Allowance for Loan Losses

12 Months Ended

Dec. 31, 2018

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 – Year Ended December 31, 2018
(in thousands)	Beginning Balance		Charge-offs			Recoveries		Provision (benefit)			Ending Balance
Mortgage loans on real estate:
Residential 1-4 family	$	2,317	$	(77	)	$	—	$	436		$	2,676
Commercial		11,441		(15	)		68		1,450			12,944
Total mortgage loans on real estate		13,758		(92	)		68		1,886			15,620
Consumer:
Home equity lines of credit		5,800		(277	)		846		(327	)		6,042
Home equity loans		1,841		(24	)		297		(574	)		1,540
Other		586		(783	)		288		702			793
Total consumer loans		8,227		(1,084	)		1,431		(199	)		8,375
Commercial		6,512		(1,188	)		541		225			6,090
Construction:
Residential		1,184		—			—		650			1,834
Commercial		642		—			—		21			663
Total construction		1,826		—			—		671			2,497
Total	$	30,323	$	(2,364	)	$	2,040	$	2,583		$	32,582

	Allowance for Loan Losses – As of December 31, 2018
(in thousands)	Loans pooled for evaluation		Individually evaluated for impairment		Loans acquired with deteriorated credit quality		Total allowance for loan losses
Mortgage loans on real estate:
Residential 1-4 family	$	2,620	$	56	$	—	$	2,676
Commercial		12,737		91		116		12,944
Total mortgage loans on real estate		15,357		147		116		15,620
Consumer:
Home equity lines of credit		5,838		198		6		6,042
Home equity loans		1,486		54		—		1,540
Other		779		14		—		793
Total consumer loans		8,103		266		6		8,375
Commercial		4,309		1,781		—		6,090
Construction:
Residential		1,834		—		—		1,834
Commercial		663		—		—		663
Total construction		2,497		—		—		2,497
Total	$	30,266	$	2,194	$	122	$	32,582

	Loans, Net of Unearned fees – As of December 31, 2018
(in thousands)	Loans pooled for evaluation		Individually evaluated for impairment		Loans acquired with deteriorated credit quality		Total loans, net of unearned fees
Mortgage loans on real estate:
Residential 1-4 family	$	509,267	$	4,321	$	1,674	$	515,262
Commercial		2,606,819		12,563		8,456		2,627,838
Total mortgage loans on real estate		3,116,086		16,884		10,130		3,143,100
Consumer:
Home equity lines of credit		322,764		2,646		1,167		326,577
Home equity loans		33,142		3,103		439		36,684
Other		55,483		196		42		55,721
Total consumer loans		411,389		5,945		1,648		418,982
Commercial		268,885		5,218		2,445		276,548
Construction:
Residential		121,296		—		—		121,296
Commercial		62,088		—		—		62,088
Total construction		183,384		—		—		183,384
Total	$	3,979,744	$	28,047	$	14,223	$	4,022,014

	Allowance for Loan Losses – Year Ended December 31, 2017
(in thousands)	Beginning Balance		Charge-offs			Recoveries		Provision (benefit)			Ending Balance
Mortgage loans on real estate:
Residential 1-4 family	$	2,748	$	(60	)	$	—	$	(371	)	$	2,317
Commercial		11,517		(186	)		397		(287	)		11,441
Total mortgage loans on real estate		14,265		(246	)		397		(658	)		13,758
Consumer:
Home equity lines of credit		7,044		(98	)		698		(1,844	)		5,800
Home equity loans		2,644		(332	)		242		(713	)		1,841
Other		622		(1,186	)		375		775			586
Total consumer loans		10,310		(1,616	)		1,315		(1,782	)		8,227
Commercial		5,831		(1,444	)		428		1,697			6,512
Construction:
Residential		1,417		(1,104	)		—		871			1,184
Commercial		680		—			1		(39	)		642
Total construction		2,097		(1,104	)		1		832			1,826
Total	$	32,503	$	(4,410	)	$	2,141	$	89		$	30,323

	Allowance for Loan Losses – As of December 31, 2017
(in thousands)	Loans pooled for evaluation		Individually evaluated for impairment		Loans acquired with deteriorated credit quality		Total allowance for loan losses
Mortgage loans on real estate:
Residential 1-4 family	$	1,932	$	230	$	155	$	2,317
Commercial		11,351		30		60		11,441
Total mortgage loans on real estate		13,283		260		215		13,758
Consumer:
Home equity lines of credit		5,356		427		17		5,800
Home equity loans		1,734		107		—		1,841
Other		529		57		—		586
Total consumer loans		7,619		591		17		8,227
Commercial		4,624		1,848		40		6,512
Construction:
Residential		1,184		—		—		1,184
Commercial		642		—		—		642
Total construction		1,826		—		—		1,826
Total	$	27,352	$	2,699	$	272	$	30,323

	Loans, Net of Unearned fees – As of December 31, 2017
(in thousands)	Loans pooled for evaluation		Individually evaluated for impairment		Loans acquired with deteriorated credit quality		Total loans, net of unearned fees
Mortgage loans on real estate:
Residential 1-4 family	$	378,743	$	5,298	$	1,385	$	385,426
Commercial		1,892,422		13,911		8,563		1,914,896
Total mortgage loans on real estate		2,271,165		19,209		9,948		2,300,322
Consumer:
Home equity lines of credit		283,502		2,688		2,498		288,688
Home equity loans		41,076		1,470		485		43,031
Other		24,853		257		45		25,155
Total consumer loans		349,431		4,415		3,028		356,874
Commercial		213,358		4,470		2,584		220,412
Construction:
Residential		67,790		140		—		67,930
Commercial		69,627		—		—		69,627
Total construction		137,417		140		—		137,557
Total	$	2,971,371	$	28,234	$	15,560	$	3,015,165

	Allowance for Loan Losses – Year Ended December 31, 2016
(in thousands)	Beginning Balance		Charge-offs			Recoveries		Provision (benefit)			Ending Balance
Mortgage loans on real estate:
Residential 1-4 family	$	2,896	$	(321	)	$	880	$	(707	)	$	2,748
Commercial		11,015		(827	)		920		409			11,517
Total mortgage loans on real estate		13,911		(1,148	)		1,800		(298	)		14,265
Consumer:
Home equity lines of credit		11,253		(585	)		2,317		(5,941	)		7,044
Home equity loans		3,177		(219	)		590		(904	)		2,644
Other		688		(823	)		449		308			622
Total consumer loans		15,118		(1,627	)		3,356		(6,537	)		10,310
Commercial		5,271		(455	)		404		611			5,831
Construction:
Residential		899		—			54		464			1,417
Commercial		812		—			78		(210	)		680
Total construction		1,711		—			132		254			2,097
Total	$	36,011	$	(3,230	)	$	5,692	$	(5,970	)	$	32,503

	Allowance for Loan Losses – As of December 31, 2016
(in thousands)	Loans pooled for evaluation		Individually evaluated for impairment		Loans acquired with deteriorated credit quality		Total allowance for loan losses
Mortgage loans on real estate:
Residential 1-4 family	$	2,304	$	258	$	186	$	2,748
Commercial		10,064		4		1,449		11,517
Total mortgage loans on real estate		12,368		262		1,635		14,265
Consumer:
Home equity lines of credit		6,616		411		17		7,044
Home equity loans		2,365		215		64		2,644
Other		594		28		—		622
Total consumer loans		9,575		654		81		10,310
Commercial		3,765		1,130		936		5,831
Construction:
Residential		1,372		—		45		1,417
Commercial		680		—		—		680
Total construction		2,052		—		45		2,097
Total	$	27,760	$	2,046	$	2,697	$	32,503

	Loans, Net of Unearned fees – As of December 31, 2016
(in thousands)	Loans pooled for evaluation		Individually evaluated for impairment		Loans acquired with deteriorated credit quality		Total Loans
Mortgage loans on real estate:
Residential 1-4 family	$	362,780	$	4,094	$	1,469	$	368,343
Commercial		1,657,238		15,081		12,802		1,685,121
Total mortgage loans on real estate		2,020,018		19,175		14,271		2,053,464
Consumer:
Home equity lines of credit		282,159		3,196		4,360		289,715
Home equity loans		42,992		1,508		1,682		46,182
Other		30,547		154		65		30,766
Total consumer loans		355,698		4,858		6,107		366,663
Commercial		208,960		4,096		3,991		217,047
Construction:
Residential		54,743		11		675		55,429
Commercial		66,990		—		—		66,990
Total construction		121,733		11		675		122,419
Total	$	2,706,409	$	28,140	$	25,044	$	2,759,593

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 Originated Loans – As of December 31, 2018
(in thousands)	Pass		Special Mention		Substandard		Doubtful / Loss		Total Originated Loans
Mortgage loans on real estate:
Residential 1-4 family	$	337,189	$	1,724	$	4,883	$	—	$	343,796
Commercial		1,861,627		33,483		15,871		—		1,910,981
Total mortgage loans on real estate		2,198,816		35,207		20,754		—		2,254,777
Consumer:
Home equity lines of credit		279,491		2,309		2,653		—		284,453
Home equity loans		29,289		1,054		2,317		—		32,660
Other		33,606		341		73		—		34,020
Total consumer loans		342,386		3,704		5,043		—		351,133
Commercial		217,126		6,127		5,382		—		228,635
Construction:
Residential		90,412		32		259		—		90,703
Commercial		55,863		345		—		—		56,208
Total construction		146,275		377		259		—		146,911
Total loans	$	2,904,603	$	45,415	$	31,438	$	—	$	2,981,456

	Credit Quality Indicators PNCI Loans – As of December 31, 2018
(in thousands)	Pass		Special Mention		Substandard		Doubtful / Loss		Total PNCI Loans
Mortgage loans on real estate:
Residential 1-4 family	$	167,908	$	1,086	$	798	$	—	$	169,792
Commercial		701,868		3,085		3,448		—		708,401
Total mortgage loans on real estate		869,776		4,171		4,246		—		878,193
Consumer:
Home equity lines of credit		38,780		1,124		1,053		—		40,957
Home equity loans		3,413		74		98		—		3,585
Other		21,481		173		5		—		21,659
Total consumer loans		63,674		1,371		1,156		—		66,201
Commercial		45,027		321		120		—		45,468
Construction:
Residential		30,593		—		—		—		30,593
Commercial		5,880		—		—		—		5,880
Total construction		36,473		—		—		—		36,473
Total loans	$	1,014,950	$	5,863	$	5,522	$	—	$	1,026,335

	Credit Quality Indicators Originated Loans – As of December 31, 2017
(in thousands)	Pass		Special Mention		Substandard		Doubtful / Loss		Total Originated Loans
Mortgage loans on real estate:
Residential 1-4 family	$	315,120	$	2,234	$	3,168	$	—	$	320,522
Commercial		1,649,333		18,434		22,743		—		1,690,510
Total mortgage loans on real estate		1,964,453		20,668		25,911		—		2,011,032
Consumer:
Home equity lines of credit		265,345		2,558		2,039		—		269,942
Home equity loans		37,428		800		1,620		—		39,848
Other		22,432		272		155		—		22,859
Total consumer loans		325,205		3,630		3,814		—		332,649
Commercial		195,208		9,492		4,737		—		209,437
Construction:
Residential		67,813		—		107		—		67,920
Commercial		64,492		4,872		—		—		69,364
Total construction		132,305		4,872		107		—		137,284
Total loans	$	2,617,171	$	38,662	$	34,569	$	—	$	2,690,402

	Credit Quality Indicators PNCI Loans – As of December 31, 2017
(in thousands)	Pass		Special Mention		Substandard		Doubtful / Loss		Total PNCI Loans
Mortgage loans on real estate:
Residential 1-4 family	$	61,411	$	218	$	1,890	$	—	$	63,519
Commercial		203,751		11,513		559		—		215,823
Total mortgage loans on real estate		265,162		11,731		2,449		—		279,342
Consumer:
Home equity lines of credit		14,866		450		932		—		16,248
Home equity loans		2,433		188		77		—		2,698
Other		2,207		38		6		—		2,251
Total consumer loans		19,506		676		1,015		—		21,197
Commercial		8,390		1		—		—		8,391
Construction:
Residential		10		—		—		—		10
Commercial		263		—		—		—		263
Total construction		273		—		—		—		273
Total	$	293,331	$	12,408	$	3,464	$	—	$	309,203

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 tables show the ending balance of current and past due originated and PNCI loans by loan category as of the date indicated:

	Analysis of Originated Past Due Loans - As of December 31, 2018
(in thousands)	30-59 days		60-89 days		> 90 days		Total Past Due Loans		Current		Total		> 90 Days and Still Accruing
Mortgage loans on real estate:
Residential 1-4 family	$	1,675	$	132	$	478	$	2,285	$	341,511	$	343,796	$	—
Commercial		431		1,200		296		1,927		1,909,054		1,910,981		—
Total mortgage loans on real estate		2,106		1,332		774		4,212		2,250,565		2,254,777		—
Consumer:
Home equity lines of credit		908		47		609		1,564		282,889		284,453		—
Home equity loans		1,043		24		214		1,281		31,379		32,660		—
Other		298		17		—		315		33,705		34,020		—
Total consumer loans		2,249		88		823		3,160		347,973		351,133		—
Commercial		1,053		579		1,247		2,879		225,756		228,635		—
Construction:
Residential		209		—		—		209		90,494		90,703		—
Commercial		—		—		—		—		56,208		56,208		—
Total construction		209		—		—		209		146,702		146,911		—
Total originated loans	$	5,617	$	1,999	$	2,844	$	10,460	$	2,970,996	$	2,981,456	$	—

	Analysis of PNCI Past Due Loans - As of December 31, 2018
(in thousands)	30-59 days		60-89 days		> 90 days		Total Past Due Loans		Current		Total		> 90 Days and Still Accruing
Mortgage loans on real estate:
Residential 1-4 family	$	1,009	$	133	$	156	$	1,298	$	168,494	$	169,792	$	—
Commercial		1,646		1,136		1,082		3,864		704,537		708,401
Total mortgage loans on real estate		2,655		1,269		1,238		5,162		873,031		878,193		—
Consumer:
Home equity lines of credit		304		35		237		576		40,381		40,957
Home equity loans		74		—		—		74		3,511		3,585		—
Other		160		—		—		160		21,499		21,659		—
Total consumer loans		538		35		237		810		65,391		66,201		—
Commercial		678		145		113		936		44,532		45,468		—
Construction:
Residential		—		—		—		—		30,593		30,593		—
Commercial		—		—		—		—		5,880		5,880		—
Total construction		—		—		—		—		36,473		36,473		—
Total PNCI loans	$	3,871	$	1,449	$	1,588	$	6,908	$	1,019,427	$	1,026,335	$	—

	Analysis of Originated Past Due Loans - As of December 31, 2017
(in thousands)	30-59 days		60-89 days		> 90 days		Total Past Due Loans		Current		Total		> 90 Days and Still Accruing
Mortgage loans on real estate:
Residential 1-4 family	$	1,740	$	510	$	243	$	2,493	$	318,029	$	320,522	$	—
Commercial		158		987		—		1,145		1,689,365		1,690,510		—
Total mortgage loans on real estate		1,898		1,497		243		3,638		2,007,394		2,011,032		—
Consumer:
Home equity lines of credit		528		48		372		948		268,994		269,942		—
Home equity loans		511		107		373		991		38,857		39,848		—
Other		56		36		3		95		22,764		22,859		—
Total consumer loans		1,095		191		748		2,034		330,615		332,649		—
Commercial		956		738		1,527		3,221		206,216		209,437		—
Construction:
Residential		34		—		—		34		67,886		67,920		—
Commercial		—		—		—		—		69,364		69,364		—
Total construction		34		—		—		34		137,250		137,284		—
Total loans	$	3,983	$	2,426	$	2,518	$	8,927	$	2,681,475	$	2,690,402	$	—

	Analysis of PNCI Past Due Loans - As of December 31, 2017
(in thousands)	30-59 days		60-89 days		> 90 days		Total Past Due Loans		Current		Total		> 90 Days and Still Accruing
Mortgage loans on real estate:
Residential 1-4 family	$	1,495	$	90	$	109	$	1,694	$	61,825	$	63,519	$	81
Commercial		70		—		—		70		215,753		215,823		—
Total mortgage loans on real estate		1,565		90		109		1,764		277,578		279,342		81
Consumer:
Home equity lines of credit		298		228		330		856		15,392		16,248		200
Home equity loans		30		—		—		30		2,668		2,698		—
Other		6		26		—		32		2,219		2,251		—
Total consumer loans		334		254		330		918		20,279		21,197		200
Commercial		—		—		—		—		8,391		8,391		—
Construction:
Residential		—		—		—		—		10		10		—
Commercial		—		—		—		—		263		263		—
Total construction		—		—		—		—		273		273		—
Total loans	$	1,899	$	344	$	439	$	2,682	$	306,521	$	309,203	$	281

The following table shows the ending balance of nonaccrual loans by loan category as of the date indicated:

	Non Accrual Loans
	As of December 31, 2018						As of December 31, 2017
(in thousands)	Originated		PNCI		Total		Originated		PNCI		Total
Mortgage loans on real estate:
Residential 1-4 family	$	3,244	$	334	$	3,578	$	1,725	$	1,012	$	2,737
Commercial		9,263		1,468		10,731		8,144		—		8,144
Total mortgage loans on real estate		12,507		1,802		14,309		9,869		1,012		10,881
Consumer:
Home equity lines of credit		1,429		885		2,314		811		402		1,213
Home equity loans		1,722		47		1,769		1,106		44		1,150
Other		3		4		7		7		5		12
Total consumer loans		3,154		936		4,090		1,924		451		2,375
Commercial		3,755		120		3,875		3,669		—		3,669
Construction:
Residential		—		—		—		—		—		—
Commercial		—		—		—		—		—		—
Total construction		—		—		—		—		—		—
Total non accrual loans	$	19,416	$	2,858	$	22,274	$	15,462	$	1,463	$	16,925

Interest income on originated nonaccrual loans that would have been recognized during the years ended December 31, 2018, 2017, and 2016, if all such loans had been current in accordance with their original terms, totaled $1,584,000, $1,067,000, and $783,000, respectively. Interest income actually recognized on these originated loans during the years ended December 31, 2018, 2017, and 2016 was $486,000, $530,000, and $377,000, respectively. Interest income on PNCI nonaccrual loans that would have been recognized during the years ended December 31, 2018, 2017, and 2016, if all such loans had been current in accordance with their original terms, totaled $1,122,000, $73,000, and $178,000, respectively. Interest income actually recognized on these PNCI loans during the years ended December 31, 2018, 2017, and 2016 was $989,000, $18,000, and $11,000, respectively.

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 Twelve Months Ended, December 31, 2018
(in thousands)	Unpaid principal balance		Recorded investment with no related allowance		Recorded investment with related allowance		Total recorded investment		Related Allowance		Average recorded investment		Interest income recognized
Mortgage loans on real estate:
Residential 1-4 family	$	4,594	$	3,663	$	308	$	3,971	$	56	$	3,517	$	90
Commercial		13,081		10,676		1,765		12,441		42		13,115		137
Total mortgage loans on real estate		17,675		14,339		2,073		16,412		98		16,632		227
Consumer:
Home equity lines of credit		1,900		1,749		111		1,860		71		1,885		43
Home equity loans		2,374		1,892		65		1,957		2		1,520		23
Other		3		—		3		3		3		17		2
Total consumer loans		4,277		3,641		179		3,820		76		3,422		68
Commercial		5,433		2,924		2,287		5,211		1,774		4,654		91
Construction:
Residential		—		—		—		—		—		5		—
Commercial		—		—		—		—		—		—		—
Total construction		—		—		—		—		—		5		—
Total	$	27,385	$	20,904	$	4,539	$	25,443	$	1,948	$	24,713	$	386
	Impaired PNCI Loans - As of, or for the Twelve Months Ended, December 31, 2018
(in thousands)	Unpaid principal balance		Recorded investment with no related allowance		Recorded investment with related allowance		Total recorded investment		Related Allowance		Average recorded investment		Interest income recognized
Mortgage loans on real estate:
Residential 1-4 family	$	375	$	334	$	—	$	334	$	—	$	529	$	5
Commercial		3,110		1,468		—		1,468		—		1,713		183
Total mortgage loans on real estate		3,485		1,802		—		1,802		—		2,242		188
Consumer:
Home equity lines of credit		1,027		587		367		954		127		1,120		18
Home equity loans		252		47		197		244		101		155		—
Other		106		21		85		106		11		114		—
Total consumer loans		1,385		655		649		1,304		239		1,389		18
Commercial		120		113		7		120		7		60		1
Construction:
Residential		—		—		—		—		—		—		—
Commercial		—		—		—		—		—		—		—
Total construction		—		—		—		—		—		—		—
Total	$	4,990	$	2,570	$	656	$	3,226	$	246	$	3,691	$	207

	Impaired Originated Loans - As of, or for the Twelve Months Ended, December 31, 2017
(in thousands)	Unpaid principal balance		Recorded investment with no related allowance		Recorded investment with related allowance		Total recorded investment		Related Allowance		Average recorded investment		Interest income recognized
Mortgage loans on real estate:
Residential 1-4 family	$	4,023	$	2,058	$	1,881	$	3,939	$	230	$	3,501	$	143
Commercial		14,186		13,101		810		13,911		30		13,851		645
Total mortgage loans on real estate		18,209		15,159		2,691		17,850		260		17,352		788
Consumer:
Home equity lines of credit		1,581		1,093		401		1,494		111		1,702		47
Home equity loans		1,627		1,107		198		1,305		10		1,193		24
Other		55		4		3		7		3		20		—
Total consumer loans		3,263		2,204		602		2,806		124		2,915		71
Commercial		4,566		575		3,895		4,470		1,848		4,283		184
Construction:
Residential		140		140		—		140		—		76		9
Commercial		—		—		—		—		—		—		—
Total construction		140		140		—		140		—		76		9
Total	$	26,178	$	18,078	$	7,188	$	25,266	$	2,232	$	24,626	$	1,052

	Impaired PNCI Loans - As of, or for the Twelve Months Ended, December 31, 2017
(in thousands)	Unpaid principal balance		Recorded investment with no related allowance		Recorded investment with related allowance		Total recorded investment		Related Allowance		Average recorded investment		Interest income recognized
Mortgage loans on real estate:
Residential 1-4 family	$	1,404	$	1,359	$	—	$	1,359	$	—	$	1,041	$	24
Commercial		—		—		—		—		—		979		—
Total mortgage loans on real estate		1,404		1,359		—		1,359		—		2,020		24
Consumer:
Home equity lines of credit		1,216		591		603		1,194		316		1,240		48
Home equity loans		178		44		121		165		97		117		6
Other		250		—		250		250		54		186		11
Total consumer loans		1,644		635		974		1,609		467		1,543		65
Commercial		—		—		—		—		—		—		—
Construction:
Residential		—		—		—		—		—		—		—
Commercial		—		—		—		—		—		—		—
Total construction		—		—		—		—		—		—		—
Total	$	3,048	$	1,994	$	974	$	2,968	$	467	$	3,563	$	89

	Impaired Originated Loans - As of, or for the Twelve Months Ended, December 31, 2016
(in thousands)	Unpaid principal balance		Recorded investment with no related allowance		Recorded investment with related allowance		Total recorded investment		Related Allowance		Average recorded investment		Interest income recognized
Mortgage loans on real estate:
Residential 1-4 family	$	3,381	$	1,820	$	1,551	$	3,371	$	180	$	4,632	$	157
Commercial		13,503		12,898		357		13,255		4		20,891		592
Total mortgage loans on real estate		16,884		14,718		1,908		16,626		184		25,523		749
Consumer:
Home equity lines of credit		2,001		1,480		430		1,910		110		3,297		49
Home equity loans		1,730		715		594		1,309		107		1,465		37
Other		48		15		19		34		13		26		3
Total consumer loans		3,779		2,210		1,043		3,253		230		4,788		89
Commercial		4,311		762		3,334		4,096		1,130		3,383		125
Construction:
Residential		16		11		—		11		—		7		—
Commercial		—		—		—		—		—		—		—
Total construction		16		11		—		11		—		7		—
Total	$	24,990	$	17,701	$	6,285	$	23,986	$	1,544	$	33,701	$	963

	Impaired PNCI Loans - As of, or for the Twelve Months Ended, December 31, 2016
(in thousands)	Unpaid principal balance		Recorded investment with no related allowance		Recorded investment with related allowance		Total recorded investment		Related Allowance		Average recorded investment		Interest income recognized
Mortgage loans on real estate:
Residential 1-4 family	$	745	$	463	$	259	$	722	$	79	$	799	$	17
Commercial		2,031		1,826		—		1,826		—		2,853		—
Total mortgage loans on real estate		2,776		2,289		259		2,548		79		3,652		17
Consumer:
Home equity lines of credit		1,297		735		551		1,286		300		1,173		36
Home equity loans		206		67		132		199		108		154		8
Other		122		3		118		121		15		194		5
Total consumer loans		1,625		805		801		1,606		423		1,521		49
Commercial		—		—		—		—		—		1		—
Construction:
Residential		—		—		—		—		—		—		—
Commercial		—		—		—		—		—		245		—
Total construction		—		—		—		—		—		245		—
Total	$	4,401	$	3,094	$	1,060	$	4,154	$	502	$	5,419	$	66

Originated loans classified as TDRs and impaired were $10,253,000, $12,517,000 and $12,371,000 at December 31, 2018, 2017 and 2016, respectively. PNCI loans classified as TDRs and impaired were $615,000, $1,352,000 and $1,324,000 at December 31, 2018, 2017 and 2016, respectively. The Company had no significant obligations to lend additional funds on Originated or PNCI TDRs as of December 31, 2018, 2017, or 2016.

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

	TDR Information for the Year Ended December 31, 2018
(dollars in thousands)	Number		Pre-mod outstanding principal balance		Post-mod outstanding principal balance		Financial impact due to TDR taken as additional provision			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
Mortgage loans on real estate:
Residential 1-4 family		1	$	156	$	156	$	—			—	$	—	$	—
Commercial		7		1,782		1,779		491			1		169		—
Total mortgage loans on real estate		8		1,938		1,935		491			1		169		—
Consumer:
Home equity lines of credit		1		133		138		—			2		248		—
Home equity loans		2		599		599		(35	)		—		—		—
Other		—		—		—		—			—		—		—
Total consumer loans		3		732		737		(35	)		2		248		—
Commercial		6		1,098		1,083		325			3		148		—
Construction:
Residential		—		—		—		—			—		—		—
Commercial		—		—		—		—			—		—		—
Total construction		—		—		—		—			—		—		—
Total		17	$	3,768	$	3,755	$	781			6	$	565	$	—

	TDR Information for the Year Ended December 31, 2017
(dollars in thousands)	Number		Pre-mod outstanding principal balance		Post-mod outstanding principal balance		Financial impact due to TDR taken as additional provision			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
Mortgage loans on real estate:
Residential 1-4 family		1	$	939	$	939	$	169			2	$	223	$	—
Commercial		8		3,721		3,695		(111	)		1		219		—
Total mortgage loans on real estate		9		4,660		4,634		58			3		442		—
Consumer:
Home equity lines of credit		3		187		187		27			1		127		(5	)
Home equity loans		1		252		252		—			1		55		—
Other		1		14		14		11			—		—		—
Total consumer loans		5		453		453		38			2		182		(5	)
Commercial		11		1,854		1,747		37			—		—		—
Construction:
Residential		1		144		144		—			—		—		—
Commercial		—		—		—		—			—		—		—
Total construction		1		144		144		—			—		—		—
Total		26	$	7,111	$	6,978	$	133			5	$	624	$	(5	)

	TDR Information for the Year Ended December 31, 2016
(dollars in thousands)	Number		Pre-mod outstanding principal balance		Post-mod outstanding principal balance		Financial impact due to TDR taken as additional provision		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
Mortgage loans on real estate:
Residential 1-4 family		3	$	650	$	656	$	50		2	$	101	$	—
Commercial		5		423		461		46		—		—		—
Total mortgage loans on real estate		8		1,073		1,117		96		2		101		—
Consumer:
Home equity lines of credit		9		707		709		205		1		229		—
Home equity loans		1		105		105		—		—		—		—
Other		2		27		27		2		—		—		—
Total consumer loans		12		839		841		207		1		229		—
Commercial		4		77		77		23				—
Construction:
Residential		—		—		—		—		—		—		—
Commercial		—		—		—		—		—		—		—
Total construction		—		—		—		—		—		—		—
Total		24	$	1,989	$	2,035	$	326		3	$	330	$	—

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.