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Loans (Tables)
 6 Months Ended
Jun. 30, 2013
Loans [Abstract]  
Analysis of allowance for loan losses by portfolio segment
An analysis of the allowance for loan losses by portfolio segment for the three months ended June 30, follows:

 
 
  
  
  
Payment
  
  
 
 
 
  
  
  
Plan
  
  
 
 
 
Commercial
  
Mortgage
  
Installment
  
Receivables
  
Unallocated
  
Total
 
 
 
(In thousands)
 
2013
 
  
  
  
  
  
 
Balance at beginning of period
 
$
10,058
  
$
20,163
  
$
3,162
  
$
129
  
$
7,253
  
$
40,765
 
Additions (deductions)
                        
Provision for loan losses
  
(1,404
)
  
(349
)
  
141
   
(12
)
  
(483
)
  
(2,107
)
Recoveries credited to allowance
  
3,181
   
450
   
306
   
21
   
-
   
3,958
 
Loans charged against the allowance
  
(3,599
)
  
(1,605
)
  
(613
)
  
(13
)
  
-
   
(5,830
)
Balance at end of period
 
$
8,236
  
$
18,659
  
$
2,996
  
$
125
  
$
6,770
  
$
36,786
 
 
                        
2012
                        
Balance at beginning of period
 
$
16,441
  
$
23,271
  
$
5,534
  
$
206
  
$
10,554
  
$
56,006
 
Additions (deductions)
                        
Provision for loan losses
  
1,194
   
570
   
229
   
(7
)
  
(930
)
  
1,056
 
Recoveries credited to allowance
  
390
   
572
   
389
   
-
   
-
   
1,351
 
Loans charged against the allowance
  
(2,379
)
  
(2,950
)
  
(953
)
  
(4
)
  
-
   
(6,286
)
Reclassification to loans held for sale
  
(170
)
  
(192
)
  
(218
)
  
-
   
(201
)
  
(781
)
Balance at end of period
 
$
15,476
  
$
21,271
  
$
4,981
  
$
195
  
$
9,423
  
$
51,346
 
 
An analysis of the allowance for loan losses by portfolio segment for the six months ended June 30, follows:

 
 
  
  
  
Payment
  
  
 
 
 
  
  
  
Plan
  
  
 
 
 
Commercial
  
Mortgage
  
Installment
  
Receivables
  
Unallocated
  
Total
 
 
 
(In thousands)
 
2013
 
  
  
  
  
  
 
Balance at beginning of period
 
$
11,402
  
$
21,447
  
$
3,378
  
$
144
  
$
7,904
  
$
44,275
 
Additions (deductions)
                        
Provision for loan losses
  
(1,676
)
  
(488
)
  
516
   
(16
)
  
(1,134
)
  
(2,798
)
Recoveries credited to allowance
  
3,717
   
1,072
   
592
   
28
   
-
   
5,409
 
Loans charged against the allowance
  
(5,207
)
  
(3,372
)
  
(1,490
)
  
(31
)
  
-
   
(10,100
)
Balance at end of period
 
$
8,236
  
$
18,659
  
$
2,996
  
$
125
  
$
6,770
  
$
36,786
 
 
                        
2012
                        
Balance at beginning of period
 
$
18,183
  
$
22,885
  
$
6,146
  
$
197
  
$
11,473
  
$
58,884
 
Additions (deductions)
                        
Provision for loan losses
  
2,690
   
4,805
   
518
   
23
   
(1,849
)
  
6,187
 
Recoveries credited to allowance
  
1,396
   
1,120
   
715
   
-
   
-
   
3,231
 
Loans charged against the allowance
  
(6,623
)
  
(7,347
)
  
(2,180
)
  
(25
)
  
-
   
(16,175
)
Reclassification to loans held for sale
  
(170
)
  
(192
)
  
(218
)
  
-
   
(201
)
  
(781
)
Balance at end of period
 
$
15,476
  
$
21,271
  
$
4,981
  
$
195
  
$
9,423
  
$
51,346
 
Allowance for loan losses and recorded investment in loans by portfolio segment
Allowance for loan losses and recorded investment in loans by portfolio segment follows:

 
 
  
  
  
Payment
  
  
 
 
 
  
  
  
Plan
  
  
 
 
 
Commercial
  
Mortgage
  
Installment
  
Receivables
  
Unallocated
  
Total
 
 
 
(In thousands)
 
June 30, 2013
 
  
  
  
  
  
 
Allowance for loan losses:
 
  
  
  
  
  
 
Individually evaluated for impairment
 
$
4,446
  
$
11,637
  
$
1,398
  
$
-
  
$
-
  
$
17,481
 
Collectively evaluated for impairment
  
3,790
   
7,022
   
1,598
   
125
   
6,770
   
19,305
 
Total ending allowance balance
 
$
8,236
  
$
18,659
  
$
2,996
  
$
125
  
$
6,770
  
$
36,786
 
 
                        
Loans
                        
Individually evaluated for impairment
 
$
47,559
  
$
82,838
  
$
7,184
  
$
-
      
$
137,581
 
Collectively evaluated for impairment
  
571,150
   
422,710
   
183,612
   
75,949
       
1,253,421
 
Total loans recorded investment
  
618,709
   
505,548
   
190,796
   
75,949
       
1,391,002
 
Accrued interest included in recorded investment
  
1,659
   
2,506
   
755
   
-
       
4,920
 
Total loans
 
$
617,050
  
$
503,042
  
$
190,041
  
$
75,949
      
$
1,386,082
 
 
                        
December 31, 2012
                        
Allowance for loan losses:
                        
Individually evaluated for impairment
 
$
6,558
  
$
12,869
  
$
1,582
  
$
-
  
$
-
  
$
21,009
 
Collectively evaluated for impairment
  
4,844
   
8,578
   
1,796
   
144
   
7,904
   
23,266
 
Total ending allowance balance
 
$
11,402
  
$
21,447
  
$
3,378
  
$
144
  
$
7,904
  
$
44,275
 
 
                        
Loans
                        
Individually evaluated for impairment
 
$
55,634
  
$
88,028
  
$
7,505
  
$
-
      
$
151,167
 
Collectively evaluated for impairment
  
563,316
   
441,703
   
183,090
   
84,692
       
1,272,801
 
Total loans recorded investment
  
618,950
   
529,731
   
190,595
   
84,692
       
1,423,968
 
Accrued interest included in recorded investment
  
1,692
   
2,391
   
746
   
-
       
4,829
 
Total loans
 
$
617,258
  
$
527,340
  
$
189,849
  
$
84,692
      
$
1,419,139
 
Loans on non-accrual status and past due more than 90 days
Loans on non-accrual status and past due more than 90 days (“Non-performing Loans”) follow:

 
 
90+ and
  
  
Total Non-
 
 
 
Still
  
Non-
  
Performing
 
 
 
Accruing
  
Accrual
  
Loans
 
 
 
(In thousands)
 
June 30, 2013
 
  
  
 
Commercial
 
  
  
 
Income producing - real estate
 
$
120
  
$
1,580
  
$
1,700
 
Land, land development and construction - real estate
  
-
   
1,775
   
1,775
 
Commercial and industrial
  
9
   
1,503
   
1,512
 
Mortgage
            
1-4 family
  
3
   
7,901
   
7,904
 
Resort lending
  
-
   
3,780
   
3,780
 
Home equity line of credit - 1st lien
  
-
   
429
   
429
 
Home equity line of credit - 2nd lien
  
-
   
729
   
729
 
Installment
            
Home equity installment - 1st lien
  
-
   
1,284
   
1,284
 
Home equity installment - 2nd lien
  
-
   
494
   
494
 
Loans not secured by real estate
  
-
   
431
   
431
 
Other
  
-
   
-
   
-
 
Payment plan receivables
            
Full refund
  
-
   
57
   
57
 
Partial refund
  
-
   
10
   
10
 
Other
  
-
   
-
   
-
 
Total recorded investment
 
$
132
  
$
19,973
  
$
20,105
 
Accrued interest included in recorded investment
 
$
1
  
$
-
  
$
1
 
December 31, 2012
            
Commercial
            
Income producing - real estate
 
$
-
  
$
5,611
  
$
5,611
 
Land, land development and construction - real estate
  
-
   
4,062
   
4,062
 
Commercial and industrial
  
-
   
5,080
   
5,080
 
Mortgage
            
1-4 family
  
7
   
9,654
   
9,661
 
Resort lending
  
-
   
4,861
   
4,861
 
Home equity line of credit - 1st lien
  
-
   
529
   
529
 
Home equity line of credit - 2nd lien
  
-
   
685
   
685
 
Installment
            
Home equity installment - 1st lien
  
-
   
1,278
   
1,278
 
Home equity installment - 2nd lien
  
-
   
675
   
675
 
Loans not secured by real estate
  
-
   
390
   
390
 
Other
  
-
   
-
   
-
 
Payment plan receivables
            
Full refund
  
-
   
57
   
57
 
Partial refund
  
-
   
38
   
38
 
Other
  
-
   
9
   
9
 
Total recorded investment
 
$
7
  
$
32,929
  
$
32,936
 
Accrued interest included in recorded investment
 
$
-
  
$
-
  
$
-
 
Aging analysis of loans by class
An aging analysis of loans by class follows:

 
 
Loans Past Due
  
Loans not
  
Total
 
 
 
30-59 days
  
60-89 days
  
90+ days
  
Total
  
Past Due
  
Loans
 
 
 
(In thousands)
 
June 30, 2013
 
  
  
  
  
  
 
Commercial
 
  
  
  
  
  
 
Income producing - real estate
 
$
185
  
$
315
  
$
1,229
  
$
1,729
  
$
233,654
  
$
235,383
 
 
                        
Land, land development and construction - real estate
  
-
   
-
   
427
   
427
   
39,071
   
39,498
 
Commercial and industrial
  
1,190
   
995
   
495
   
2,680
   
341,148
   
343,828
 
Mortgage
                        
1-4 family
  
4,292
   
805
   
7,904
   
13,001
   
271,706
   
284,707
 
Resort lending
  
124
   
-
   
3,780
   
3,904
   
154,302
   
158,206
 
Home equity line of credit - 1st lien
  
369
   
-
   
429
   
798
   
17,779
   
18,577
 
Home equity line of credit - 2nd lien
  
470
   
194
   
729
   
1,393
   
42,665
   
44,058
 
Installment
                        
Home equity installment - 1st lien
  
624
   
170
   
1,284
   
2,078
   
27,441
   
29,519
 
Home equity installment - 2nd lien
  
429
   
110
   
494
   
1,033
   
37,150
   
38,183
 
Loans not secured by real estate
  
797
   
213
   
431
   
1,441
   
119,039
   
120,480
 
Other
  
38
   
10
   
-
   
48
   
2,566
   
2,614
 
Payment plan receivables
                        
Full refund
  
1,817
   
753
   
57
   
2,627
   
68,853
   
71,480
 
Partial refund
  
98
   
29
   
10
   
137
   
4,297
   
4,434
 
Other
  
2
   
-
   
-
   
2
   
33
   
35
 
Total recorded investment
 
$
10,435
  
$
3,594
  
$
17,269
  
$
31,298
  
$
1,359,704
  
$
1,391,002
 
                        
Accrued interest included in recorded investment
 
$
97
  
$
34
  
$
1
  
$
132
  
$
4,788
  
$
4,920
 
 
                        
December 31, 2012
                        
Commercial
                        
Income producing - real estate
 
$
3,734
  
$
609
  
$
2,826
  
$
7,169
  
$
215,623
  
$
222,792
 
                        
Land, land development and construction - real estate
  
336
   
-
   
1,176
   
1,512
   
41,750
   
43,262
 
Commercial and industrial
  
2,522
   
654
   
1,913
   
5,089
   
347,807
   
352,896
 
Mortgage
                        
1-4 family
  
4,429
   
1,115
   
9,661
   
15,205
   
279,132
   
294,337
 
Resort lending
  
748
   
370
   
4,861
   
5,979
   
164,414
   
170,393
 
Home equity line of credit - 1st lien
  
453
   
51
   
529
   
1,033
   
18,003
   
19,036
 
Home equity line of credit - 2nd lien
  
442
   
32
   
685
   
1,159
   
44,806
   
45,965
 
Installment
                        
Home equity installment - 1st lien
  
599
   
140
   
1,278
   
2,017
   
30,368
   
32,385
 
Home equity installment - 2nd lien
  
430
   
125
   
675
   
1,230
   
38,956
   
40,186
 
Loans not secured by real estate
  
899
   
259
   
390
   
1,548
   
113,751
   
115,299
 
Other
  
24
   
12
   
-
   
36
   
2,689
   
2,725
 
Payment plan receivables
                        
Full refund
  
2,249
   
552
   
57
   
2,858
   
77,335
   
80,193
 
Partial refund
  
112
   
46
   
38
   
196
   
4,119
   
4,315
 
Other
  
3
   
6
   
9
   
18
   
166
   
184
 
Total recorded investment
 
$
16,980
  
$
3,971
  
$
24,098
  
$
45,049
  
$
1,378,919
  
$
1,423,968
 
 
                        
Accrued interest included in recorded investment
 
$
146
  
$
43
  
$
-
  
$
189
  
$
4,640
  
$
4,829
 
Sales of certain commercial watch, substandard and non-performing loans
During the three month period ending June 30, 2013 we sold certain commercial watch, substandard and non-performing loans as follows:

 
 
(In thousands)
 
Income producing - real estate
 
$
4,570
 
Land, land development and construction - real estate
  
401
 
Commercial and industrial
  
3,630
 
Total
 
$
8,601
 
Impaired loans
Impaired loans are as follows :

 
 
June 30,
  
December 31,
 
 
 
2013
  
2012
 
Impaired loans with no allocated allowance
 
(In thousands)
 
TDR
 
$
16,741
  
$
14,435
 
Non - TDR
  
538
   
418
 
Impaired loans with an allocated allowance
        
TDR - allowance based on collateral
  
8,868
   
16,231
 
TDR - allowance based on present value cash flow
  
109,889
   
112,997
 
Non - TDR - allowance based on collateral
  
1,023
   
6,580
 
Non - TDR - allowance based on present value cash flow
  
-
   
-
 
Total impaired loans
 
$
137,059
  
$
150,661
 
 
        
Amount of allowance for loan losses allocated
        
TDR - allowance based on collateral
 
$
2,952
  
$
5,060
 
TDR - allowance based on present value cash flow
  
14,276
   
14,462
 
Non - TDR - allowance based on collateral
  
253
   
1,487
 
Non - TDR - allowance based on present value cash flow
  
-
   
-
 
Total amount of allowance for loan losses allocated
 
$
17,481
  
$
21,009
 
 
Impaired loans by class are as follows (1):

 
 
June 30, 2013
  
December 31, 2012
 
 
 
  
Unpaid
  
  
  
Unpaid
  
 
 
 
Recorded
  
Principal
  
Related
  
Recorded
  
Principal
  
Related
 
 
 
Investment
  
Balance
  
Allowance
  
Investment
  
Balance
  
Allowance
 
With no related allowance recorded:
 
(In thousands)
  
 
Commercial
 
  
  
  
  
  
 
Income producing - real estate
 
$
4,813
  
$
4,808
  
$
-
  
$
4,050
  
$
4,672
  
$
-
 
Land, land development & construction-real estate
  
3,475
   
4,459
   
-
   
3,304
   
3,294
   
-
 
Commercial and industrial
  
4,129
   
4,417
   
-
   
2,611
   
2,592
   
-
 
Mortgage
                        
1-4 family
  
8
   
8
   
-
   
-
   
-
   
-
 
Resort lending
  
35
   
163
   
-
   
-
   
-
   
-
 
Home equity line of credit - 1st lien
  
-
   
-
   
-
   
-
   
-
   
-
 
Home equity line of credit - 2nd lien
  
-
   
-
   
-
   
-
   
-
   
-
 
Installment
                        
Home equity installment - 1st lien
  
1,950
   
2,070
   
-
   
2,027
   
2,219
   
-
 
Home equity installment - 2nd lien
  
2,311
   
2,302
   
-
   
2,278
   
2,278
   
-
 
Loans not secured by real estate
  
591
   
697
   
-
   
610
   
681
   
-
 
Other
  
18
   
18
   
-
   
20
   
20
   
-
 
 
  
17,330
   
18,942
   
-
   
14,900
   
15,756
   
-
 
With an allowance recorded:
                        
Commercial
                        
Income producing - real estate
  
19,410
   
22,139
   
1,910
   
20,628
   
24,250
   
1,822
 
Land, land development & construction-real estate
  
5,800
   
6,535
   
943
   
8,808
   
11,971
   
1,986
 
Commercial and industrial
  
9,932
   
10,194
   
1,593
   
16,233
   
18,564
   
2,750
 
Mortgage
                        
1-4 family
  
60,948
   
64,384
   
7,957
   
64,160
   
68,418
   
8,518
 
Resort lending
  
21,650
   
22,547
   
3,593
   
23,763
   
24,160
   
4,321
 
Home equity line of credit - 1st lien
  
155
   
166
   
83
   
62
   
77
   
30
 
Home equity line of credit - 2nd lien
  
42
   
118
   
4
   
43
   
118
   
-
 
Installment
                        
Home equity installment - 1st lien
  
1,076
   
1,185
   
520
   
1,215
   
1,240
   
610
 
Home equity installment - 2nd lien
  
1,010
   
1,019
   
816
   
1,161
   
1,174
   
930
 
Loans not secured by real estate
  
228
   
228
   
62
   
194
   
194
   
42
 
Other
  
-
   
-
   
-
   
-
   
-
   
-
 
 
  
120,251
   
128,515
   
17,481
   
136,267
   
150,166
   
21,009
 
Total
                        
Commercial
                        
Income producing - real estate
  
24,223
   
26,947
   
1,910
   
24,678
   
28,922
   
1,822
 
Land, land development & construction-real estate
  
9,275
   
10,994
   
943
   
12,112
   
15,265
   
1,986
 
Commercial and industrial
  
14,061
   
14,611
   
1,593
   
18,844
   
21,156
   
2,750
 
Mortgage
                        
1-4 family
  
60,956
   
64,392
   
7,957
   
64,160
   
68,418
   
8,518
 
Resort lending
  
21,685
   
22,710
   
3,593
   
23,763
   
24,160
   
4,321
 
Home equity line of credit - 1st lien
  
155
   
166
   
83
   
62
   
77
   
30
 
Home equity line of credit - 2nd lien
  
42
   
118
   
4
   
43
   
118
   
-
 
Installment
                        
Home equity installment - 1st lien
  
3,026
   
3,255
   
520
   
3,242
   
3,459
   
610
 
Home equity installment - 2nd lien
  
3,321
   
3,321
   
816
   
3,439
   
3,452
   
930
 
Loans not secured by real estate
  
819
   
925
   
62
   
804
   
875
   
42
 
Other
  
18
   
18
   
-
   
20
   
20
   
-
 
Total
 
$
137,581
  
$
147,457
  
$
17,481
  
$
151,167
  
$
165,922
  
$
21,009
 
 
                        
Accrued interest included in recorded investment
 
$
522
          
$
506
         

(1)
There were no impaired payment plan receivables at June 30, 2013 or December 31, 2012.
Average recorded investment in and interest income earned on impaired loans by class
Average recorded investment in and interest income earned on impaired loans by class for the three month periods ending June 30, follows (1):

 
 
2013
  
2012
 
 
 
Average
  
Interest
  
Average
  
Interest
 
 
 
Recorded
  
Income
  
Recorded
  
Income
 
 
 
Investment
  
Recognized
  
Investment
  
Recognized
 
With no related allowance recorded:
 
(In thousands)
 
Commercial
 
  
  
  
 
Income producing - real estate
 
$
4,856
  
$
42
  
$
2,211
  
$
13
 
Land, land development & construction-real estate
  
3,212
   
42
   
2,877
   
36
 
Commercial and industrial
  
4,400
   
76
   
3,896
   
44
 
Mortgage
                
1-4 family
  
4
   
-
   
-
   
-
 
Resort lending
  
35
   
-
   
936
   
-
 
Home equity line of credit - 1st lien
  
-
   
-
   
-
   
-
 
Home equity line of credit - 2nd lien
  
-
   
-
   
-
   
-
 
Installment
                
Home equity installment - 1st lien
  
2,020
   
28
   
1,827
   
32
 
Home equity installment - 2nd lien
  
2,313
   
33
   
1,987
   
30
 
Loans not secured by real estate
  
599
   
7
   
473
   
7
 
Other
  
19
   
-
   
23
   
-
 
 
  
17,458
   
228
   
14,230
   
162
 
With an allowance recorded:
                
Commercial
                
Income producing - real estate
  
20,745
   
176
   
24,300
   
120
 
Land, land development & construction-real estate
  
6,837
   
55
   
10,495
   
52
 
Commercial and industrial
  
11,886
   
88
   
18,954
   
156
 
Mortgage
                
1-4 family
  
62,011
   
682
   
66,900
   
725
 
Resort lending
  
21,916
   
222
   
23,697
   
252
 
Home equity line of credit - 1st lien
  
156
   
-
   
70
   
-
 
Home equity line of credit - 2nd lien
  
42
   
-
   
93
   
1
 
Installment
                
Home equity installment - 1st lien
  
1,023
   
8
   
1,709
   
9
 
Home equity installment - 2nd lien
  
1,074
   
12
   
1,469
   
6
 
Loans not secured by real estate
  
221
   
4
   
241
   
3
 
Other
  
-
   
-
   
-
   
-
 
 
  
125,911
   
1,247
   
147,928
   
1,324
 
Total
                
Commercial
                
Income producing - real estate
  
25,601
   
218
   
26,511
   
133
 
Land, land development & construction-real estate
  
10,049
   
97
   
13,372
   
88
 
Commercial and industrial
  
16,286
   
164
   
22,850
   
200
 
Mortgage
                
1-4 family
  
62,015
   
682
   
66,900
   
725
 
Resort lending
  
21,951
   
222
   
24,633
   
252
 
Home equity line of credit - 1st lien
  
156
   
-
   
70
   
-
 
Home equity line of credit - 2nd lien
  
42
   
-
   
93
   
1
 
Installment
                
Home equity installment - 1st lien
  
3,043
   
36
   
3,536
   
41
 
Home equity installment - 2nd lien
  
3,387
   
45
   
3,456
   
36
 
Loans not secured by real estate
  
820
   
11
   
714
   
10
 
Other
  
19
   
-
   
23
   
-
 
Total
 
$
143,369
  
$
1,475
  
$
162,158
  
$
1,486
 

(1)
There were no impaired payment plan receivables during the three month periods ended June 30, 2013 and 2012, respectively.
 
Average recorded investment in and interest income earned on impaired loans by class for the six month periods ending June 30, follows (1):

 
 
2013
  
2012
 
 
 
Average
  
Interest
  
Average
  
Interest
 
 
 
Recorded
  
Income
  
Recorded
  
Income
 
 
 
Investment
  
Recognized
  
Investment
  
Recognized
 
With no related allowance recorded:
 
(In thousands)
 
Commercial
 
  
  
  
 
Income producing - real estate
 
$
4,587
  
$
105
  
$
3,016
  
$
30
 
Land, land development & construction-real estate
  
3,243
   
84
   
1,991
   
36
 
Commercial and industrial
  
3,803
   
114
   
3,795
   
46
 
Mortgage
                
1-4 family
  
3
   
-
   
-
   
-
 
Resort lending
  
23
   
-
   
805
   
-
 
Home equity line of credit - 1st lien
  
-
   
-
   
-
   
-
 
Home equity line of credit - 2nd lien
  
-
   
-
   
-
   
-
 
Installment
                
Home equity installment - 1st lien
  
2,022
   
52
   
1,918
   
52
 
Home equity installment - 2nd lien
  
2,301
   
62
   
1,987
   
51
 
Loans not secured by real estate
  
602
   
15
   
528
   
13
 
Other
  
19
   
1
   
23
   
1
 
 
  
16,603
   
433
   
14,063
   
229
 
With an allowance recorded:
                
Commercial
                
Income producing - real estate
  
20,706
   
313
   
23,793
   
267
 
Land, land development & construction-real estate
  
7,494
   
111
   
11,117
   
105
 
Commercial and industrial
  
13,335
   
228
   
17,667
   
270
 
Mortgage
                
1-4 family
  
62,727
   
1,388
   
67,329
   
1,449
 
Resort lending
  
22,532
   
441
   
24,055
   
496
 
Home equity line of credit - 1st lien
  
125
   
1
   
67
   
1
 
Home equity line of credit - 2nd lien
  
42
   
1
   
106
   
2
 
Installment
                
Home equity installment - 1st lien
  
1,087
   
20
   
1,550
   
30
 
Home equity installment - 2nd lien
  
1,103
   
25
   
1,453
   
25
 
Loans not secured by real estate
  
212
   
6
   
211
   
5
 
Other
  
-
   
-
   
-
   
-
 
 
  
129,363
   
2,534
   
147,348
   
2,650
 
Total
                
Commercial
                
Income producing - real estate
  
25,293
   
418
   
26,809
   
297
 
Land, land development & construction-real estate
  
10,737
   
195
   
13,108
   
141
 
Commercial and industrial
  
17,138
   
342
   
21,462
   
316
 
Mortgage
                
1-4 family
  
62,730
   
1,388
   
67,329
   
1,449
 
Resort lending
  
22,555
   
441
   
24,860
   
496
 
Home equity line of credit - 1st lien
  
125
   
1
   
67
   
1
 
Home equity line of credit - 2nd lien
  
42
   
1
   
106
   
2
 
Installment
                
Home equity installment - 1st lien
  
3,109
   
72
   
3,468
   
82
 
Home equity installment - 2nd lien
  
3,404
   
87
   
3,440
   
76
 
Loans not secured by real estate
  
814
   
21
   
739
   
18
 
Other
  
19
   
1
   
23
   
1
 
Total
 
$
145,966
  
$
2,967
  
$
161,411
  
$
2,879
 

(1)
There were no impaired payment plan receivables during the six month periods ended June 30, 2013 and 2012, respectively.
Troubled debt restructurings
Troubled debt restructurings follow:
 
 
 
June 30, 2013
 
 
 
Commercial
  
Retail
  
Total
 
 
 
(In thousands)
 
Performing TDR's
 
$
42,543
  
$
83,187
  
$
125,730
 
Non-performing TDR's(1)
  
3,298
   
6,470
(2) 
  
9,768
 
Total
 
$
45,841
  
$
89,657
  
$
135,498
 
 
            
 
 
December 31, 2012
 
 
 
Commercial
  
Retail
  
Total
 
 
 
(In thousands)
 
Performing TDR's
 
$
40,753
  
$
85,977
  
$
126,730
 
Non-performing TDR's(1)
  
7,756
   
9,177
(2) 
  
16,933
 
Total
 
$
48,509
  
$
95,154
  
$
143,663
 

(1)Included in non-performing loans table above.
(2)Also includes loans on non-accrual at the time of modification until six payments are received on a timely basis.
Troubled debt restructuring during the period
Loans that have been classified as troubled debt restructurings during the three-month periods ended June 30 follow:

 
 
  
Pre-modification
  
Post-modification
 
 
 
Number of
  
Recorded
  
Recorded
 
 
 
Contracts
  
Balance
  
Balance
 
 
 
(Dollars in thousands)
 
2013
 
  
  
 
Commercial
 
  
  
 
Income producing - real estate
  
2
  
$
395
  
$
287
 
Land, land development & construction-real estate
  
-
   
-
   
-
 
Commercial and industrial
  
2
   
72
   
70
 
Mortgage
            
1-4 family
  
6
   
482
   
451
 
Resort lending
  
1
   
234
   
231
 
Home equity line of credit - 1st lien
  
-
   
-
   
-
 
Home equity line of credit - 2nd lien
  
-
   
-
   
-
 
Installment
            
Home equity installment - 1st lien
  
6
   
153
   
144
 
Home equity installment - 2nd lien
  
4
   
64
   
66
 
Loans not secured by real estate
  
1
   
27
   
27
 
Other
  
-
   
-
   
-
 
Total
  
22
  
$
1,427
  
$
1,276
 
 
            
2012
            
Commercial
            
Income producing - real estate
  
12
  
$
8,045
  
$
7,974
 
Land, land development & construction-real estate
  
1
   
49
   
77
 
Commercial and industrial
  
19
   
4,286
   
4,001
 
Mortgage
            
1-4 family
  
28
   
3,504
   
3,372
 
Resort lending
  
11
   
3,031
   
2,917
 
Home equity line of credit - 1st lien
  
-
   
-
   
-
 
Home equity line of credit - 2nd lien
  
-
   
-
   
-
 
Installment
            
Home equity installment - 1st lien
  
6
   
118
   
115
 
Home equity installment - 2nd lien
  
6
   
317
   
313
 
Loans not secured by real estate
  
9
   
252
   
233
 
Other
  
-
   
-
   
-
 
Total
  
92
  
$
19,602
  
$
19,002
 
 
Loans that have been classified as troubled debt restructurings during the six-month periods ended June 30 follow:

 
 
  
Pre-modification
  
Post-modification
 
 
 
Number of
  
Recorded
  
Recorded
 
 
 
Contracts
  
Balance
  
Balance
 
 
 
(Dollars in thousands)
 
2013
 
  
  
 
Commercial
 
  
  
 
Income producing - real estate
  
5
  
$
4,478
  
$
3,877
 
Land, land development & construction-real estate
  
1
   
16
   
-
 
Commercial and industrial
  
15
   
912
   
810
 
Mortgage
            
1-4 family
  
13
   
1,273
   
1,235
 
Resort lending
  
4
   
1,033
   
1,022
 
Home equity line of credit - 1st lien
  
1
   
95
   
96
 
Home equity line of credit - 2nd lien
  
-
   
-
   
-
 
Installment
            
Home equity installment - 1st lien
  
13
   
326
   
317
 
Home equity installment - 2nd lien
  
10
   
212
   
212
 
Loans not secured by real estate
  
3
   
84
   
54
 
Other
  
-
   
-
   
-
 
Total
  
65
  
$
8,429
  
$
7,623
 
 
            
2012
            
Commercial
            
Income producing - real estate
  
14
  
$
8,268
  
$
8,191
 
Land, land development & construction-real estate
  
3
   
2,887
   
2,913
 
Commercial and industrial
  
33
   
8,196
   
7,895
 
Mortgage
            
1-4 family
  
43
   
4,802
   
4,639
 
Resort lending
  
18
   
5,206
   
5,072
 
Home equity line of credit - 1st lien
  
1
   
15
   
6
 
Home equity line of credit - 2nd lien
  
-
   
-
   
-
 
Installment
            
Home equity installment - 1st lien
  
10
   
426
   
426
 
Home equity installment - 2nd lien
  
13
   
511
   
507
 
Loans not secured by real estate
  
10
   
277
   
258
 
Other
  
-
   
-
   
-
 
Total
  
145
  
$
30,588
  
$
29,907
 
Troubled debt restructuring during the past twelve months that subsequently defaulted
Loans that have been classified as troubled debt restructurings during the past twelve months and that have subsequently defaulted during the three-month periods ended June 30 follow:

 
 
Number of
  
Recorded
 
 
 
Contracts
  
Balance
 
 
 
(Dollars in thousands)
 
2013
 
  
 
Commercial
 
  
 
Income producing - real estate
  
-
  
$
-
 
Land, land development & construction-real estate
  
-
   
-
 
Commercial and industrial
  
-
   
-
 
Mortgage
        
1-4 family
  
-
   
-
 
Resort lending
  
-
   
-
 
Home equity line of credit - 1st lien
  
-
   
-
 
Home equity line of credit - 2nd lien
  
-
   
-
 
Installment
        
Home equity installment - 1st lien
  
-
   
-
 
Home equity installment - 2nd lien
  
1
   
22
 
Loans not secured by real estate
  
-
   
-
 
Other
  
-
   
-
 
 
  
1
  
$
22
 
 
        
2012
        
Commercial
        
Income producing - real estate
  
-
  
$
-
 
Land, land development & construction-real estate
  
-
   
-
 
Commercial and industrial
  
1
   
41
 
Mortgage
        
1-4 family
  
2
   
148
 
Resort lending
  
-
   
-
 
Home equity line of credit - 1st lien
  
-
   
-
 
Home equity line of credit - 2nd lien
  
-
   
-
 
Installment
        
Home equity installment - 1st lien
  
-
   
-
 
Home equity installment - 2nd lien
  
1
   
20
 
Loans not secured by real estate
  
-
   
-
 
Other
  
-
   
-
 
 
  
4
  
$
209
 
 
Loans that have been classified as troubled debt restructurings during the past twelve months and that have subsequently defaulted during the six-month periods ended June 30 follow:

 
 
Number of
  
Recorded
 
 
 
Contracts
  
Balance
 
 
 
(Dollars in thousands)
 
2013
 
  
 
Commercial
 
  
 
Income producing - real estate
  
-
  
$
-
 
Land, land development & construction-real estate
  
1
   
334
 
Commercial and industrial
  
2
   
143
 
Mortgage
        
1-4 family
  
1
   
106
 
Resort lending
  
1
   
156
 
Home equity line of credit - 1st lien
  
-
   
-
 
Home equity line of credit - 2nd lien
  
-
   
-
 
Installment
        
Home equity installment - 1st lien
  
-
   
-
 
Home equity installment - 2nd lien
  
1
   
22
 
Loans not secured by real estate
  
-
   
-
 
Other
  
-
   
-
 
 
  
6
  
$
761
 
 
        
2012
        
Commercial
        
Income producing - real estate
  
2
  
$
434
 
Land, land development & construction-real estate
  
1
   
136
 
Commercial and industrial
  
8
   
914
 
Mortgage
        
1-4 family
  
2
   
148
 
Resort lending
  
1
   
117
 
Home equity line of credit - 1st lien
  
-
   
-
 
Home equity line of credit - 2nd lien
  
-
   
-
 
Installment
        
Home equity installment - 1st lien
  
1
   
26
 
Home equity installment - 2nd lien
  
1
   
20
 
Loans not secured by real estate
  
-
   
-
 
Other
  
-
   
-
 
 
  
16
  
$
1,795
 
Summary of loan ratings by loan class
The following table summarizes loan ratings by loan class for our commercial loan segment:

 
 
Commercial
 
 
 
  
  
Substandard
  
Non-
  
 
 
 
Non-watch
  
Watch
  
Accrual
  
Accrual
  
 
 
 1-6   
7-8
  9  10-11  
Total
 
 
         
(In thousands)
      
 
June 30, 2013
                 
 
Income producing - real estate
 
$
198,087
  
$
28,157
  
$
7,559
  
$
1,580
  
$
235,383
 
Land, land development and construction - real estate
  
31,938
   
5,129
   
656
   
1,775
   
39,498
 
Commercial and industrial
  
302,006
   
30,820
   
9,499
   
1,503
   
343,828
 
Total
 
$
532,031
  
$
64,106
  
$
17,714
  
$
4,858
  
$
618,709
 
Accrued interest included in total
 
$
1,383
  
$
200
  
$
76
  
$
-
  
$
1,659
 
 
                    
December 31, 2012
                    
Income producing - real estate
 
$
183,530
  
$
27,096
  
$
6,555
  
$
5,611
  
$
222,792
 
Land, land development and construction - real estate
  
32,784
   
3,457
   
2,959
   
4,062
   
43,262
 
Commercial and industrial
  
307,566
   
26,954
   
13,296
   
5,080
   
352,896
 
Total
 
$
523,880
  
$
57,507
  
$
22,810
  
$
14,753
  
$
618,950
 
Accrued interest included in total
 
$
1,417
  
$
163
  
$
112
  
$
-
  
$
1,692
 

For each of our mortgage and installment segment classes we generally monitor credit quality based on the credit scores of the borrowers. These credit scores are generally updated at least annually.
The following table summarizes credit scores by loan class for our mortgage and installment loan segments:

  
Mortgage (1)
 
  
  
  
Home
  
Home
  
 
  
  
Resort
  
Equity
  
Equity
  
 
  
1-4 Family
  
Lending
  
1st Lien
  
2nd Lien
  
Total
 
  
(In thousands)
 
June 30, 2013
  
  
  
  
  
 
800 and above
  
$
21,681
  
$
15,087
  
$
3,327
  
$
5,751
  
$
45,846
 
 
750-799
   
60,588
   
58,783
   
4,977
   
12,065
   
136,413
 
 
700-749
   
58,990
   
41,689
   
3,015
   
8,552
   
112,246
 
 
650-699
   
53,520
   
20,453
   
2,879
   
7,349
   
84,201
 
 
600-649
   
33,396
   
9,578
   
2,296
   
4,839
   
50,109
 
 
550-599
   
25,039
   
4,514
   
982
   
3,076
   
33,611
 
 
500-549
   
17,986
   
1,963
   
452
   
1,786
   
22,187
 
Under 500
   
8,443
   
1,359
   
416
   
589
   
10,807
 
Unknown
   
5,064
   
4,780
   
233
   
51
   
10,128
 
Total
  
$
284,707
  
$
158,206
  
$
18,577
  
$
44,058
  
$
505,548
 
Accrued interest included in total
  
$
1,410
  
$
775
  
$
91
  
$
230
  
$
2,506
 
                       
December 31, 2012
                     
800 and above
  
$
19,638
  
$
15,430
  
$
3,031
  
$
5,515
  
$
43,614
 
 
750-799
   
62,419
   
67,094
   
4,758
   
12,783
   
147,054
 
 
700-749
   
59,594
   
41,860
   
3,293
   
9,177
   
113,924
 
 
650-699
   
57,584
   
17,685
   
2,309
   
7,987
   
85,565
 
 
600-649
   
31,465
   
12,317
   
3,311
   
4,775
   
51,868
 
 
550-599
   
27,739
   
7,887
   
964
   
2,754
   
39,344
 
 
500-549
   
20,243
   
1,212
   
656
   
1,997
   
24,108
 
Under 500
   
9,470
   
1,637
   
456
   
789
   
12,352
 
Unknown
   
6,185
   
5,271
   
258
   
188
   
11,902
 
Total
  
$
294,337
  
$
170,393
  
$
19,036
  
$
45,965
  
$
529,731
 
Accrued interest included in total
  
$
1,319
  
$
750
  
$
91
  
$
231
  
$
2,391
 
 
(1) Credit scores have been updated within the last twelve months.
  
Installment(1)
 
  
Home
  
Home
  
Loans not
  
  
 
  
Equity
  
Equity
  
Secured by
  
  
 
  
1st Lien
  
2nd Lien
  
Real Estate
  
Other
  
Total
 
  
(In thousands)
 
June 30, 2013
  
  
  
  
  
 
800 and above
  
$
3,071
  
$
3,287
  
$
20,962
  
$
37
  
$
27,357
 
 
750-799
   
7,251
   
10,799
   
46,424
   
529
   
65,003
 
 
700-749
   
5,014
   
8,625
   
24,751
   
707
   
39,097
 
 
650-699
   
5,063
   
7,734
   
15,266
   
634
   
28,697
 
 
600-649
   
3,801
   
3,337
   
5,893
   
266
   
13,297
 
 
550-599
   
2,372
   
1,914
   
2,557
   
235
   
7,078
 
 
500-549
   
2,259
   
1,600
   
1,931
   
130
   
5,920
 
Under 500
   
525
   
799
   
724
   
35
   
2,083
 
Unknown
   
163
   
88
   
1,972
   
41
   
2,264
 
Total
  
$
29,519
  
$
38,183
  
$
120,480
  
$
2,614
  
$
190,796
 
Accrued interest included in total
  
$
132
  
$
158
  
$
443
  
$
22
  
$
755
 
                       
December 31, 2012
                     
800 and above
  
$
3,909
  
$
3,265
  
$
19,293
  
$
38
  
$
26,505
 
 
750-799
   
7,394
   
11,300
   
43,740
   
462
   
62,896
 
 
700-749
   
4,884
   
8,826
   
24,267
   
786
   
38,763
 
 
650-699
   
5,925
   
7,164
   
13,758
   
710
   
27,557
 
 
600-649
   
4,360
   
4,214
   
6,442
   
367
   
15,383
 
 
550-599
   
3,226
   
2,716
   
3,428
   
188
   
9,558
 
 
500-549
   
1,722
   
1,403
   
2,154
   
114
   
5,393
 
Under 500
   
760
   
1,195
   
895
   
42
   
2,892
 
Unknown
   
205
   
103
   
1,322
   
18
   
1,648
 
Total
  
$
32,385
  
$
40,186
  
$
115,299
  
$
2,725
  
$
190,595
 
Accrued interest included in total
  
$
137
  
$
157
  
$
429
  
$
23
  
$
746
 
 
(1) Credit scores have been updated within the last twelve months.

Mepco Finance Corporation (“Mepco”) is a wholly-owned subsidiary of our Bank that operates a vehicle service contract payment plan business throughout the United States. See Note #14 for more information about Mepco’s business. As of June 30, 2013, approximately 94.1% of Mepco’s outstanding payment plan receivables relate to programs in which a third party insurer or risk retention group is obligated to pay Mepco the full refund owing upon cancellation of the related service contract (including with respect to both the portion funded to the service contract seller and the portion funded to the administrator). These receivables are shown as “Full Refund” in the table below. Another approximately 5.8% of Mepco’s outstanding payment plan receivables as of June 30, 2013, relate to programs in which a third party insurer or risk retention group is obligated to pay Mepco the refund owing upon cancellation only with respect to the unearned portion previously funded by Mepco to the administrator (but not to the service contract seller). These receivables are shown as “Partial Refund” in the table below. The balance of Mepco’s outstanding payment plan receivables relate to programs in which there is no insurer or risk retention group that has any contractual liability to Mepco for any portion of the refund amount. These receivables are shown as “Other” in the table below. For each class of our payment plan receivables we monitor credit ratings of the counterparties as we evaluate the credit quality of this portfolio.
The following table summarizes credit ratings of insurer or risk retention group counterparties by class of payment plan receivable:

  
Payment Plan Receivables
 
  
Full
  
Partial
  
  
 
  
Refund
  
Refund
  
Other
  
Total
 
  
(In thousands)
 
June 30, 2013
  
  
  
  
 
AM Best rating
  
  
  
  
 
A+
 
$
-
  
$
-
  
$
-
  
$
-
 
A 
  
28,000
   
3,698
   
-
   
31,698
 
A-
   
9,041
   
736
   
-
   
9,777
 
B+
  
-
   
-
   
-
   
-
 
B 
  
-
   
-
   
-
   
-
 
Not rated
   
34,439
   
-
   
35
   
34,474
 
Total
  
$
71,480
  
$
4,434
  
$
35
  
$
75,949
 
                  
December 31, 2012
                 
AM Best rating
                 
A+
 
$
-
  
$
-
  
$
110
  
$
110
 
A
  
24,825
   
3,916
   
-
   
28,741
 
A-
   
19,310
   
399
   
-
   
19,709
 
B+
  
56
   
-
   
-
   
56
 
B
  
-
   
-
   
-
   
-
 
Not rated
   
36,002
   
-
   
74
   
36,076
 
Total
  
$
80,193
  
$
4,315
  
$
184
  
$
84,692