LOANS AND LEASES (Tables)

6 Months Ended

Jun. 30, 2017

Commercial and Consumer Credit Exposure by Risk Attribute

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



	As of June 30, 2017
	Commercial		Real Estate				Lease
(Dollars in thousands)	and industrial		Construction		Commercial		financing		Total
Pass	$	1,767,573	$	442,021	$	2,414,945	$	87,875	$	4,712,414
Special Mention	27,225		0		11,096		65		38,386
Substandard	29,791		1,091		45,614		212		76,708
Doubtful	0		0		0		0		0
Total	$	1,824,589	$	443,112	$	2,471,655	$	88,152	$	4,827,508



(Dollars in thousands)	Residential real estate		Home equity		Installment		Credit card		Total
Performing	$	481,770	$	460,362	$	47,329	$	44,139	$	1,033,600
Nonperforming	8,628		3,704		325		0		12,657
Total	$	490,398	$	464,066	$	47,654	$	44,139	$	1,046,257



	As of December 31, 2016
	Commercial		Real Estate				Lease
(Dollars in thousands)	and industrial		Construction		Commercial		financing		Total
Pass	$	1,725,451	$	398,155	$	2,349,662	$	92,540	$	4,565,808
Special Mention	18,256		1,258		15,584		108		35,206
Substandard	38,241		21		62,331		460		101,053
Doubtful	0		0		0		0		0
Total	$	1,781,948	$	399,434	$	2,427,577	$	93,108	$	4,702,067



(Dollars in thousands)	Residential real estate		Home equity		Installment		Credit card		Total
Performing	$	491,380	$	456,314	$	50,202	$	43,408	$	1,041,304
Nonperforming	9,600		4,074		437		0		14,111
Total	$	500,980	$	460,388	$	50,639	$	43,408	$	1,055,415

Loan Delinquency, including Nonaccrual Loans

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



	As of June 30, 2017
(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 and industrial	$	6,705	$	255	$	4,336	$	11,296	$	1,809,190	$	1,820,486	$	4,103	$	1,824,589	$	0
Lease financing	199		0		0		199		87,953		88,152		0		88,152		0
Construction real estate	0		0		1,075		1,075		441,520		442,595		517		443,112		0
Commercial real estate	1,047		1,281		9,234		11,562		2,392,126		2,403,688		67,967		2,471,655		0
Residential real estate	78		635		3,521		4,234		443,491		447,725		42,673		490,398		0
Home equity	431		157		885		1,473		459,495		460,968		3,098		464,066		0
Installment	87		142		268		497		46,364		46,861		793		47,654		0
Credit card	274		119		124		517		43,622		44,139		0		44,139		124
Total	$	8,821	$	2,589	$	19,443	$	30,853	$	5,723,761	$	5,754,614	$	119,151	$	5,873,765	$	124



	As of December 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 and industrial	$	1,257	$	208	$	1,339	$	2,804	$	1,773,939	$	1,776,743	$	5,205	$	1,781,948	$	0
Lease financing	137		0		115		252		92,856		93,108		0		93,108		0
Construction real estate	0		0		0		0		398,877		398,877		557		399,434		0
Commercial real estate	777		134		5,589		6,500		2,339,327		2,345,827		81,750		2,427,577		2,729
Residential real estate	821		37		2,381		3,239		450,631		453,870		47,110		500,980		0
Home equity	195		145		1,776		2,116		456,143		458,259		2,129		460,388		0
Installment	24		1		258		283		49,058		49,341		1,298		50,639		0
Credit card	457		177		142		776		42,632		43,408		0		43,408		142
Total	$	3,668	$	702	$	11,600	$	15,970	$	5,603,463	$	5,619,433	$	138,049	$	5,757,482	$	2,871

Loans Restructured During Period

The following tables provide information on loan modifications classified as TDRs during the three and six months ended June 30, 2017 and 2016:



	Three months ended
	June 30, 2017					June 30, 2016
(Dollars in thousands)	Number of loans	Pre-modification loan balance		Period end balance		Number of loans	Pre-modification loan balance		Period end balance
Commercial and industrial	4	$	2,177	$	2,183	2	$	44	$	35
Construction real estate	0	0		0		0	0		0
Commercial real estate	6	1,506		1,449		9	1,468		1,040
Residential real estate	0	0		0		0	0		0
Home equity	0	0		0		0	0		0
Installment	0	0		0		1	2		2
Total	10	$	3,683	$	3,632	12	$	1,514	$	1,077

	Six months ended
	June 30, 2017					June 30, 2016
(Dollars in thousands)	Number of loans	Pre-modification loan balance		Period end balance		Number of loans	Pre-modification loan balance		Period end balance
Commercial and industrial	6	$	5,679	$	5,624	10	$	2,127	$	2,130
Construction real estate	0	0		0		0	0		0
Commercial real estate	6	1,506		1,449		10	1,510		1,082
Residential real estate	0	0		0		2	282		247
Home equity	0	0		0		4	149		140
Installment	0	0		0		3	9		9
Total	12	$	7,185	$	7,073	29	$	4,077	$	3,608

Loans Restructured, Modifications

The following table provides information on how TDRs were modified during the three and six months ended June 30, 2017 and 2016:



	Three months ended				Six months ended
	June 30,				June 30,
(Dollars in thousands)	2017		2016		2017		2016
Extended maturities	$	2,587	$	35	$	3,261	$	521
Adjusted interest rates	0		0		2,767		0
Combination of rate and maturity changes	180		0		180		162
Forbearance	827		88		827		88
Other ⁽¹⁾	38		954		38		2,837
Total	$	3,632	$	1,077	$	7,073	$	3,608

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

Nonaccrual, Restructured and Impaired Loans

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



(Dollars in thousands)	June 30, 2017		December 31, 2016
Impaired loans
Nonaccrual loans⁽¹⁾
Commercial and industrial	$	15,099	$	2,419
Lease financing	94		195
Construction real estate	1,075		0
Commercial real estate	12,617		6,098
Residential real estate	4,442		5,251
Home equity	2,937		3,400
Installment	307		367
Credit card	0		0
Nonaccrual loans ⁽¹⁾	36,571		17,730
Accruing troubled debt restructurings	20,135		30,240
Total impaired loans	$	56,706	$	47,970

⁽¹⁾ Nonaccrual loans include nonaccrual TDRs of $9.4 million and $5.1 million as of June 30, 2017 and December 31, 2016, respectively.



	Three months ended				Six months ended
	June 30,				June 30,
(Dollars in thousands)	2017		2016		2017		2016
Interest income effect on impaired loans
Gross amount of interest that would have been recorded under original terms	$	1,158	$	714	$	1,974	$	1,468
Interest included in income
Nonaccrual loans	163		96		305		172
Troubled debt restructurings	169		209		395		441
Total interest included in income	332		305		700		613
Net impact on interest income	$	826	$	409	$	1,274	$	855

Investment in Impaired Loans

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



	As of June 30, 2017						As of December 31, 2016
(Dollars in thousands)	Current balance		Contractual principal balance		Related allowance		Current balance		Contractual principal balance		Related allowance
Loans with no related allowance recorded
Commercial and industrial	$	15,315	$	18,938	$	0	$	12,134	$	12,713	$	0
Lease financing	94		94		0		195		195		0
Construction real estate	1,075		1,075		0		0		0		0
Commercial real estate	23,285		26,082		0		12,232		14,632		0
Residential real estate	7,557		8,844		0		8,412		9,648		0
Home equity	3,603		4,750		0		3,973		5,501		0
Installment	325		497		0		437		603		0
Total	51,254		60,280		0		37,383		43,292		0

Loans with an allowance recorded
Commercial and industrial	3,484		3,484		2,443		1,069		1,071		550
Lease financing	0		0		0		0		0		0
Construction real estate	0		0		0		0		0		0
Commercial real estate	796		796		124		8,228		8,277		593
Residential real estate	1,071		1,075		160		1,189		1,189		179
Home equity	101		101		2		101		101		2
Installment	0		0		0		0		0		0
Total	5,452		5,456		2,729		10,587		10,638		1,324

Total
Commercial and industrial	18,799		22,422		2,443		13,203		13,784		550
Lease financing	94		94		0		195		195		0
Construction real estate	1,075		1,075		0		0		0		0
Commercial real estate	24,081		26,878		124		20,460		22,909		593
Residential real estate	8,628		9,919		160		9,601		10,837		179
Home equity	3,704		4,851		2		4,074		5,602		2
Installment	325		497		0		437		603		0
Total	$	56,706	$	65,736	$	2,729	$	47,970	$	53,930	$	1,324

First Financial's average impaired loans by class and interest income recognized by class was as follows:



	Three months ended
	June 30, 2017				June 30, 2016
(Dollars in thousands)	Average Recorded Investment		Interest Income Recognized		Average Recorded Investment		Interest Income Recognized
Loans with no related allowance recorded
Commercial and industrial	$	17,198	$	87	$	13,022	$	75
Lease financing	98		1		109		1
Construction real estate	1,075		0		0		0
Commercial real estate	25,465		144		14,924		91
Residential real estate	7,605		46		7,405		49
Home equity	3,926		27		5,176		21
Installment	357		1		378		2
Total	55,724		306		41,014		239

Loans with an allowance recorded
Commercial and industrial	2,301		11		1,064		9
Lease financing	0		0		535		8
Construction real estate	0		0		0		0
Commercial real estate	658		8		7,034		40
Residential real estate	1,126		6		1,470		8
Home equity	101		1		101		1
Installment	0		0		0		0
Total	4,186		26		10,204		66

Total
Commercial and industrial	19,499		98		14,086		84
Lease financing	98		1		644		9
Construction real estate	1,075		0		0		0
Commercial real estate	26,123		152		21,958		131
Residential real estate	8,731		52		8,875		57
Home equity	4,027		28		5,277		22
Installment	357		1		378		2
Total	$	59,910	$	332	$	51,218	$	305



	Six months ended
	June 30, 2017				June 30, 2016
(Dollars in thousands)	Average Recorded Investment		Interest Income Recognized		Average Recorded Investment		Interest Income Recognized
Loans with no related allowance recorded
Commercial and industrial	$	15,607	$	196	$	14,154	$	149
Lease financing	149		2		113		1
Construction real estate	538		0		0		0
Commercial real estate	19,939		304		15,383		161
Residential real estate	8,032		92		7,419		95
Home equity	4,111		51		5,231		42
Installment	413		3		336		3
Total	48,789		648		42,636		451

Loans with an allowance recorded
Commercial and industrial	1,094		24		1,040		18
Lease financing	0		0		357		8
Construction real estate	0		0		0		0
Commercial real estate	4,374		13		7,473		117
Residential real estate	1,185		13		1,496		17
Home equity	101		2		101		2
Installment	0		0		0		0
Total	6,754		52		10,467		162

Total
Commercial and industrial	16,701		220		15,194		167
Lease financing	149		2		470		9
Construction real estate	538		0		0		0
Commercial real estate	24,313		317		22,856		278
Residential real estate	9,217		105		8,915		112
Home equity	4,212		53		5,332		44
Installment	413		3		336		3
Total	$	55,543	$	700	$	53,103	$	613

Changes in Other Real Estate Owned

Changes in OREO were as follows:



	Three months ended						Six months ended
	June 30,						June 30,
(Dollars in thousands)	2017			2016			2017			2016
Balance at beginning of period	$	5,300		$	11,939		$	6,284		$	13,254
Additions
Commercial and industrial	50			102			172			888
Residential real estate	1,913			169			2,078			291
Total additions	1,963			271			2,250			1,179
Disposals
Commercial and industrial	(682		)	(1,893		)	(1,607		)	(2,093		)
Residential real estate	(448		)	(244		)	(685		)	(2,079		)
Total disposals	(1,130		)	(2,137		)	(2,292		)	(4,172		)
Valuation adjustment
Commercial and industrial	(116		)	(29		)	(162		)	(146		)
Residential real estate	(56		)	(13		)	(119		)	(84		)
Total valuation adjustment	(172		)	(42		)	(281		)	(230		)
Balance at end of period	$	5,961		$	10,031		$	5,961		$	10,031