LOANS AND LEASES (Tables)

3 Months Ended

Mar. 31, 2016

Accounts, Notes, Loans and Financing Receivable [Line Items]

Carrying Amount of Accretable Yield for Purchased Impaired and Nonimpaired Loans

Changes in the carrying amount of accretable difference for purchased impaired loans were as follows:



	Three months ended
	March 31,
(Dollars in thousands)	2016			2015
Balance at beginning of period	$	64,857		$	106,622
Reclassification from/(to) nonaccretable difference	318			(1,576		)
Accretion	(4,210		)	(6,357		)
Other net activity ⁽¹⁾	(2,241		)	(6,701		)
Balance at end of period	$	58,724		$	91,988

Commercial and Consumer Credit Exposure by Risk Attribute

Commercial and consumer credit exposure by risk attribute was as follows:



	As of March 31, 2016
			Real Estate
(Dollars in thousands)	Commercial		Construction		Commercial		Leasing		Total
Pass	$	1,680,764	$	337,472	$	2,182,683	$	99,583	$	4,300,502
Special Mention	22,155		3,417		19,754		0		45,326
Substandard	41,813		564		59,420		1,552		103,349
Doubtful	0		0		0		0		0
Total	$	1,744,732	$	341,453	$	2,261,857	$	101,135	$	4,449,177



(Dollars in thousands)	Real Estate Residential		Home Equity		Installment		Other		Total
Performing	$	499,849	$	460,341	$	41,408	$	39,283	$	1,040,881
Nonperforming	8,663		5,669		219		0		14,551
Total	$	508,512	$	466,010	$	41,627	$	39,283	$	1,055,432



	As of December 31, 2015
			Real Estate
(Dollars in thousands)	Commercial		Construction		Commercial		Leasing		Total
Pass	$	1,596,415	$	310,806	$	2,179,701	$	93,236	$	4,180,158
Special Mention	27,498		128		19,903		0		47,529
Substandard	39,189		778		58,693		750		99,410
Doubtful	0		0		0		0		0
Total	$	1,663,102	$	311,712	$	2,258,297	$	93,986	$	4,327,097



(Dollars in thousands)	Real Estate Residential		Home Equity		Installment		Other		Total
Performing	$	503,317	$	461,188	$	41,253	$	41,217	$	1,046,975
Nonperforming	8,994		5,441		253		0		14,688
Total	$	512,311	$	466,629	$	41,506	$	41,217	$	1,061,663

Loan Delinquency, including Nonaccrual Loans

Loan delinquency, including loans classified as nonaccrual, was as follows:



	As of March 31, 2016
(Dollars in thousands)	30 – 59 days past due		60 – 89 days past due		> 90 days past due		Total past due		Current		Subtotal		Purchased impaired		Total		> 90 days past due and still accruing
Loans
Commercial	$	4,354	$	310	$	3,034	$	7,698	$	1,729,886	$	1,737,584	$	7,148	$	1,744,732	$	0
Real estate - construction	5,002		0		0		5,002		335,689		340,691		762		341,453		0
Real estate - commercial	2,718		0		6,631		9,349		2,141,626		2,150,975		110,882		2,261,857		0
Real estate - residential	858		0		2,020		2,878		450,582		453,460		55,052		508,512		0
Home equity	505		81		3,025		3,611		460,929		464,540		1,470		466,010		0
Installment	133		13		67		213		39,713		39,926		1,701		41,627		0
Other	435		328		59		822		139,596		140,418		0		140,418		59
Total	$	14,005	$	732	$	14,836	$	29,573	$	5,298,021	$	5,327,594	$	177,015	$	5,504,609	$	59



	As of December 31, 2015
(Dollars in thousands)	30 – 59 days past due		60 – 89 days past due		> 90 days past due		Total past due		Current		Subtotal		Purchased impaired		Total		> 90 days past due and still accruing
Loans
Commercial	$	2,255	$	2,232	$	1,937	$	6,424	$	1,648,902	$	1,655,326	$	7,776	$	1,663,102	$	0
Real estate - construction	0		17		0		17		310,872		310,889		823		311,712		0
Real estate - commercial	2,501		913		7,421		10,835		2,124,290		2,135,125		123,172		2,258,297		0
Real estate - residential	1,220		239		2,242		3,701		451,907		455,608		56,703		512,311		0
Home equity	696		248		2,830		3,774		461,647		465,421		1,208		466,629		0
Installment	197		111		48		356		39,206		39,562		1,944		41,506		0
Other	920		302		230		1,452		133,751		135,203		0		135,203		108
Total	$	7,789	$	4,062	$	14,708	$	26,559	$	5,170,575	$	5,197,134	$	191,626	$	5,388,760	$	108

Loans Restructured During Period

The following tables provide information on loan modifications classified as TDRs during the three months ended March 31, 2016 and 2015:



	Three months ended
	March 31, 2016					March 31, 2015
(Dollars in thousands)	Number of loans	Pre-modification loan balance		Period end balance		Number of loans	Pre-modification loan balance		Period end balance
Commercial	8	$	2,083	$	2,095	8	$	360	$	359
Real estate - construction	0	0		0		0	0		0
Real estate - commercial	1	42		42		6	12,914		9,343
Real estate - residential	2	281		247		0	0		0
Home equity	4	149		140		0	0		0
Installment	2	7		7		0	0		0
Total	17	$	2,562	$	2,531	14	$	13,274	$	9,702

Loans Restructured, Modifications

The following table provides information on how TDRs were modified during the three months ended March 31, 2016 and 2015.



	Three months ended
	March 31,
(Dollars in thousands)	2016		2015
Extended maturities	$	486	$	9,481
Adjusted interest rates	0		0
Combination of rate and maturity changes	162		62
Forbearance	0		0
Other ⁽¹⁾	1,883		159
Total	$	2,531	$	9,702

(1) Includes covenant modifications and other concessions, or combination of concessions, that do not consist of interest rate adjustments, forbearance and maturity extensions

Loan Restructuring, Loans with a Payment Default Within 12 Months of Loan Modification

The following table provides information on TDRs for which there was a payment default during the period that occurred within twelve months of the loan modification:



	Three months ended
	March 31, 2016			March 31, 2015
(Dollars in thousands)	Number of loans	Period end balance		Number of loans	Period end balance
Commercial	1	$	55	0	$	0
Real estate - construction	0	0		0	0
Real estate - commercial	0	0		3	967
Real estate - residential	1	214		1	73
Home equity	1	28		0	0
Installment	1	4		0	0
Total	4	$	301	4	$	1,040

Nonaccrual, Restructured and Impaired Loans

The following table provides information on impaired loans, excluding purchased impaired loans.



(Dollars in thousands)	March 31, 2016		December 31, 2015
Impaired loans
Nonaccrual loans⁽¹⁾
Commercial	$	3,917	$	8,405
Real estate-construction	0		0
Real estate-commercial	8,577		9,418
Real estate-residential	4,243		5,027
Home equity	5,036		4,898
Installment	113		127
Other	121		122
Nonaccrual loans ⁽¹⁾	22,007		27,997
Accruing troubled debt restructurings	30,127		28,876
Total impaired loans	$	52,134	$	56,873

(1) Nonaccrual loans include nonaccrual TDRs of $7.5 million and $9.3 million as of March 31, 2016 and December 31, 2015, respectively.



	Three months ended
	March 31,
(Dollars in thousands)	2016		2015
Interest income effect on impaired loans
Gross amount of interest that would have been recorded under original terms	$	754	$	967
Interest included in income
Nonaccrual loans	76		171
Troubled debt restructurings	232		132
Total interest included in income	308		303
Net impact on interest income	$	446	$	664

Investment in Impaired Loans

First Financial's investment in impaired loans was as follows:



	As of March 31, 2016
(Dollars in thousands)	Current balance		Contractual principal balance		Related allowance		Average current balance		YTD interest income recognized
Loans with no related allowance recorded
Commercial	$	13,512	$	14,442	$	0	$	14,965	$	74
Real estate - construction	0		0		0		0		0
Real estate - commercial	14,003		18,707		0		15,152		70
Real estate - residential	7,126		8,383		0		7,287		46
Home equity	5,569		7,673		0		5,455		21
Installment	219		236		0		236		1
Other	121		121		0		122		0
Total	40,550		49,562		0		43,217		212

Loans with an allowance recorded
Commercial	973		1,163		400		983		9
Real estate - construction	0		0		0		0		0
Real estate - commercial	8,974		8,974		763		8,663		77
Real estate - residential	1,537		1,551		236		1,542		9
Home equity	100		100		2		101		1
Installment	0		0		0		0		0
Other	0		0		0		0		0
Total	11,584		11,788		1,401		11,289		96

Total
Commercial	14,485		15,605		400		15,948		83
Real estate - construction	0		0		0		0		0
Real estate - commercial	22,977		27,681		763		23,815		147
Real estate - residential	8,663		9,934		236		8,829		55
Home equity	5,669		7,773		2		5,556		22
Installment	219		236		0		236		1
Other	121		121		0		122		0
Total	$	52,134	$	61,350	$	1,401	$	54,506	$	308



	As of and for the year December 31, 2015
(Dollars in thousands)	Current balance		Contractual principal balance		Related allowance		Average current balance		Interest income recognized
Loans with no related allowance recorded
Commercial	$	16,418	$	17,398	$	0	$	10,468	$	258
Real estate - construction	0		0		0		150		0
Real estate - commercial	16,301		20,479		0		19,363		344
Real estate - residential	7,447		8,807		0		8,143		184
Home equity	5,340		7,439		0		5,648		82
Installment	253		276		0		380		7
Other	122		122		0		24		0
Total	45,881		54,521		0		44,176		875

Loans with an allowance recorded
Commercial	993		1,178		357		1,409		26
Real estate - construction	0		0		0		0		0
Real estate - commercial	8,351		8,706		979		12,928		213
Real estate - residential	1,547		1,560		235		1,696		40
Home equity	101		101		2		101		3
Installment	0		0		0		0		0
Other	0		0		0		0		0
Total	10,992		11,545		1,573		16,134		282

Total
Commercial	17,411		18,576		357		11,877		284
Real estate - construction	0		0		0		150		0
Real estate - commercial	24,652		29,185		979		32,291		557
Real estate - residential	8,994		10,367		235		9,839		224
Home equity	5,441		7,540		2		5,749		85
Installment	253		276		0		380		7
Other	122		122		0		24		0
Total	$	56,873	$	66,066	$	1,573	$	60,310	$	1,157

Changes in Other Real Estate Owned

Changes in OREO were as follows:



	Three months ended
	March 31,
(Dollars in thousands)	2016 ⁽¹⁾			2015 ⁽¹⁾
Balance at beginning of period	$	13,254		$	22,674
Additions
Commercial	786			2,173
Residential	122			1,058
Total additions	908			3,231
Disposals
Commercial	(200		)	(4,145		)
Residential	(1,835		)	(412		)
Total disposals	(2,035		)	(4,557		)
Valuation adjustment
Commercial	(117		)	(418		)
Residential	(71		)	(24		)
Total valuation adjustment	(188		)	(442		)
Balance at end of period	$	11,939		$	20,906

Indemnification Asset Rollforward

Changes in the balance of the FDIC indemnification asset and the related impact to the Consolidated Statements of Income are presented in the table that follows:



	Three months ended
	March 31,
(Dollars in thousands)	2016			2015			Affected Line Item in the Consolidated Statements of Income
Balance at beginning of period	$	17,630		$	22,666
Adjustments not reflected in income
Net FDIC claims (received) / paid	362			204
Adjustments reflected in income
Amortization	(1,171		)	(1,195		)	Interest income, other earning assets
FDIC loss sharing income	(565		)	(1,046		)	Noninterest income, FDIC loss sharing income
Offset to accelerated discount	0			(232		)	Noninterest income, accelerated discount on covered loans
Balance at end of period	$	16,256		$	20,397