Loans and Allowance (Tables)

9 Months Ended

Sep. 30, 2021

Receivables [Abstract]

Schedule of composition of loan portfolio by loan class

The following table illustrates the composition of the Corporation’s loan portfolio by loan class for the periods indicated:

	September 30, 2021		December 31, 2020
Commercial and industrial loans	$	2,573,615	$	2,776,699
Agricultural land, production and other loans to farmers	240,686		281,884
Real estate loans:
Construction	521,889		484,723
Commercial real estate, non-owner occupied	2,150,387		2,220,949
Commercial real estate, owner occupied	952,441		958,501
Residential	1,154,373		1,234,741
Home equity	531,307		508,259
Individuals' loans for household and other personal expenditures	135,093		129,479
Public finance and other commercial loans	781,785		647,939
Loans	$	9,041,576	$	9,243,174

Schedule of credit quality and collateral of loan portfolio by loan class

The following tables summarize the risk grading of the Corporation’s loan portfolio by loan class and by year of origination for the years indicated. Consumer loans are not risk graded. For the purposes of this disclosure, the consumer loans are classified in the following manner: loans that are less than 30 days past due are Pass, loans 30-89 days past due are Special Mention and loans greater than 89 days past due are Substandard. The entire balance of a loan is considered delinquent if the minimum payment contractually required to be made is not received by the specified due date. Loans that evidenced deterioration of credit quality since origination and it was probable, at acquisition, that all contractually required payments would not be collected are included in the applicable categories below. Commercial and industrial loan balances as of September 30, 2021 with an origination year of 2021 and 2020 include PPP loans of $182.2 million and $15.9 million, respectively.

	Term Loans (amortized cost basis by origination year)
	2021		2020		2019		2018		2017		Prior		Revolving loans amortized cost basis		Revolving loans converted to term		Total
Commercial and industrial loans
Pass	$	795,366	$	458,425	$	188,155	$	74,791	$	24,767	$	41,419	$	884,233	$	—	$	2,467,156
Special Mention	10,551		27,059		211		992		2,032		2,026		17,466		—		60,337
Substandard	5,912		2,327		6,058		2,948		480		776		27,621		—		46,122
Total Commercial and industrial loans	$	811,829	$	487,811	$	194,424	$	78,731	$	27,279	$	44,221	$	929,320	$	—	$	2,573,615
Agricultural land, production and other loans to farmers
Pass	37,000		48,740		23,447		9,152		7,451		39,875		63,254		—		228,919
Special Mention	84		1,561		—		—		—		391		274		—		2,310
Substandard	719		538		137		1,798		—		2,925		3,340		—		9,457
Total Agricultural land, production and other loans to farmers	$	37,803	$	50,839	$	23,584	$	10,950	$	7,451	$	43,191	$	66,868	$	—	$	240,686
Real estate loans:
Construction
Pass	132,653		202,455		114,065		31,056		2,229		2,559		15,671				500,688
Special Mention	20,839		275		—		—		—		—		—		—		21,114
Substandard	—		25		—		62		—		—		—		—		87
Total Construction	$	153,492	$	202,755	$	114,065	$	31,118	$	2,229	$	2,559	$	15,671	$	—	$	521,889
Commercial real estate, non-owner occupied
Pass	455,140		740,465		228,864		132,584		127,045		156,901		26,696		—		1,867,695
Special Mention	52,739		172,621		—		98		—		2,698		—		—		228,156
Substandard	19,437		25,983		180		1,169		7,477		290		—		—		54,536
Total Commercial real estate, non-owner occupied	$	527,316	$	939,069	$	229,044	$	133,851	$	134,522	$	159,889	$	26,696	$	—	$	2,150,387
Commercial real estate, owner occupied
Pass	221,409		423,411		99,381		45,467		49,800		58,497		32,468		—		930,433
Special Mention	1,548		6,064		745		1,604		—		1,326		149		—		11,436
Substandard	1,687		4,565		—		53		2,413		1,854		—		—		10,572
Total Commercial real estate, owner occupied	$	224,644	$	434,040	$	100,126	$	47,124	$	52,213	$	61,677	$	32,617	$	—	$	952,441
Residential
Pass	263,658		381,258		115,505		80,009		60,398		235,365		4,306		44		1,140,543
Special Mention	874		1,131		464		27		229		2,200		5		—		4,930
Substandard	1,103		3,134		105		1,267		109		3,182		—		—		8,900
Total Residential	$	265,635	$	385,523	$	116,074	$	81,303	$	60,736	$	240,747	$	4,311	$	44	$	1,154,373
Home equity
Pass	68,318		21,473		2,315		2,374		1,419		3,982		427,901		195		527,977
Special Mention	—		87		—		9		—		17		1,378		—		1,491
Substandard	472		—		—		—		94		200		1,073		—		1,839
Total Home Equity	$	68,790	$	21,560	$	2,315	$	2,383	$	1,513	$	4,199	$	430,352	$	195	$	531,307
Individuals' loans for household and other personal expenditures
Pass	41,367		30,506		17,797		13,132		2,657		5,684		23,659		—		134,802
Special Mention	31		101		65		45		7		15		11		—		275
Substandard	—		3		—		—		—		13		—		—		16
Total Individuals' loans for household and other personal expenditures	$	41,398	$	30,610	$	17,862	$	13,177	$	2,664	$	5,712	$	23,670	$	—	$	135,093
Public finance and other commercial loans
Pass	203,809		179,913		100,892		39,236		107,674		129,488		20,773		—		781,785
Total Public finance and other commercial loans	$	203,809	$	179,913	$	100,892	$	39,236	$	107,674	$	129,488	$	20,773	$	—	$	781,785
Loans	$	2,334,716	$	2,732,120	$	898,386	$	437,873	$	396,281	$	691,683	$	1,550,278	$	239	$	9,041,576

	December 31, 2020
	Commercial Pass		Commercial Special Mention		Commercial Substandard		Commercial Doubtful		Commercial Loss		Consumer Performing		Consumer Non-Performing		Total
Commercial and industrial loans	$	2,562,077	$	117,503	$	97,119	$	—	$	—	$	—	$	—	$	2,776,699
Agricultural land, production and other loans to farmers	243,991		26,835		9,885		—		—		1,173		—		281,884
Real estate Loans:
Construction	446,846		10,445		5,549		—		—		21,763		120		484,723
Commercial real estate, non-owner occupied	1,979,827		160,304		80,818		—		—		—		—		2,220,949
Commercial real estate, owner occupied	907,566		17,641		33,294						—		—		958,501
Residential	199,338		2,261		7,058		—		—		1,020,687		5,397		1,234,741
Home equity	12,714		—		989		—		—		492,999		1,557		508,259
Individuals' loans for household and other personal expenditures	—		—		—		—		—		129,440		39		129,479
Public finance and other commercial loans	647,939		—		—		—		—		—		—		647,939
Loans	$	7,000,298	$	334,989	$	234,712	$	—	$	—	$	1,666,062	$	7,113	$	9,243,174

The following table presents the amortized cost basis of collateral dependent loans, which are individually evaluated to determine expected credit losses:

	September 30, 2021
	Commercial Real Estate		Residential Real Estate		Other		Total		Allowance on Collateral Dependent Loans
Commercial and industrial loans	$	—	$	—	$	17,450	$	17,450	$	4,985
Agricultural land, production and other loans to farmers	—		—		300		300		—
Real estate loans:
Construction	—		15		—		15		1
Commercial real estate, non-owner occupied	26,703		—		—		26,703		6,463
Commercial real estate, owner occupied	1,846		—		—		1,846		21
Residential	—		2,927		—		2,927		327
Home equity	—		402		—		402		66
Loans	$	28,549	$	3,344	$	17,750	$	49,643	$	11,863

Schedule of past due aging of loan portfolio by loan class

The tables below show a past due aging of the Corporation’s loan portfolio, by loan class, for the years indicated:

	September 30, 2021
	Current		30-59 Days Past Due		60-89 Days Past Due		90 Days or More Past Due		Total		Loans > 90 Days or More Past Due And Accruing
Commercial and industrial loans	$	2,554,111	$	2,667	$	507	$	16,330	$	2,573,615	$	1
Agricultural land, production and other loans to farmers	240,660		—		—		26		240,686		—
Real estate loans:
Construction	521,889		—		—		—		521,889		—
Commercial real estate, non-owner occupied	2,142,055		4,698		424		3,210		2,150,387		—
Commercial real estate, owner occupied	950,676		393		1,017		355		952,441		—
Residential	1,147,965		2,982		1,195		2,231		1,154,373		111
Home equity	528,760		1,197		355		995		531,307		43
Individuals' loans for household and other personal expenditures	134,801		233		43		16		135,093		2
Public finance and other commercial loans	781,785		—		—		—		781,785		—
Loans	$	9,002,702	$	12,170	$	3,541	$	23,163	$	9,041,576	$	157

	December 31, 2020
	Current		30-59 Days Past Due		60-89 Days Past Due		90 Days or More Past Due		Total		Loans > 90 Days or More Past Due And Accruing
Commercial and industrial loans	$	2,761,473	$	5,866	$	6,571	$	2,789	$	2,776,699	$	594
Agricultural land, production and other loans to farmers	280,615		146		226		897		281,884		—
Real estate loans:
Construction	484,706		—		17		—		484,723		—
Commercial real estate, non-owner occupied	2,184,681		2,525		2,109		31,634		2,220,949		—
Commercial real estate, owner occupied	951,561		4,854		180		1,906		958,501		—
Residential	1,226,779		3,269		1,429		3,264		1,234,741		133
Home equity	503,596		2,644		559		1,460		508,259		19
Individuals' loans for household and other personal expenditures	129,049		334		96		—		129,479		—
Public finance and other commercial loans	647,939		—		—		—		647,939		—
Loans	$	9,170,399	$	19,638	$	11,187	$	41,950	$	9,243,174	$	746

Schedule of non-accrual loans by loan class

The following table summarizes the Corporation’s non-accrual loans by loan class for the periods indicated:

	September 30, 2021				December 31, 2020
	Non-Accrual Loans		Non-Accrual Loans with no Allowance for Credit Losses		Non-Accrual Loans
Commercial and industrial loans	$	16,817	$	628	$	2,329
Agricultural land, production and other loans to farmers	119		—		1,012
Real estate loans:
Construction	15		—		123
Commercial real estate, non-owner occupied	26,176		3,816		46,316
Commercial real estate, owner occupied	1,002		545		3,040
Residential	5,556		797		6,517
Home equity	1,804		—		2,095
Individuals' loans for household and other personal expenditures	13		—		39
Loans	$	51,502	$	5,786	$	61,471

Schedules of troubled debt restructurings

The following tables summarize troubled debt restructures in the Corporation's loan portfolio that occurred during the three months and nine months ended September 30, 2021 and 2020, respectively.

			Three Months Ended September 30, 2021
	Pre- Modification Recorded Balance		Term Modification		Rate Modification		Post - Modification Recorded Balance		Number of Loans
Real estate loans:
Construction	$	16	$	—	$	16	$	16	1
Commercial real estate, non owner occupied	12,922		12,976		—		12,976		1
Total	$	12,938	$	12,976	$	16	$	12,992	2

			Three Months Ended September 30, 2020
	Pre- Modification Recorded Balance		Term Modification		Rate Modification		Post - Modification Recorded Balance		Number of Loans
Real estate loans:
Residential	$	2,314	$	2,275	$	51	$	2,326	30
Home Equity	307		212		95		307		2
Individuals' loans for household and other personal expenditures	19		19		—		19		2
Total	$	2,640	$	2,506	$	146	$	2,652	34

			Nine Months Ended September 30, 2021
	Pre- Modification Recorded Balance		Term Modification		Rate Modification		Combination		Post - Modification Recorded Balance		Number of Loans
Commercial and industrial loans	$	348	$	348	$	—	$	—	$	348	2
Real estate loans:
Construction	16		—		16		—		16		1
Commercial real estate, non owner occupied	12,922		12,976		—		—		12,976		1
Commercial real estate, owner occupied	21		—		—		21		21		1
Residential	691		449		126		118		693		9
Total	$	13,998	$	13,773	$	142	$	139	$	14,054	14

			Nine Months Ended September 30, 2020
	Pre- Modification Recorded Balance		Term Modification		Rate Modification		Combination		Post - Modification Recorded Balance		Number of Loans
Commercial and industrial loans	$	654	$	654	$	—	$	—	$	654	3
Agricultural land, production and other loans to farmers	458		458		—		—		458		1
Real estate loans:
Commercial real estate, owner occupied	107		107		—		—		107		1
Residential	2,614		2,276		163		224		2,663		36
Home Equity	307		211		96		—		307		2
Individuals' loans for household and other personal expenditures	19		19		—		—		19		2
Total	$	4,159	$	3,725	$	259	$	224	$	4,208	45

The following tables summarize troubled debt restructures that occurred during the twelve months ended September 30, 2021 and 2020, that subsequently defaulted during the period indicated and remained in default at period end. For purposes of this schedule, a loan is considered in default if it is 30-days or more past due.

	Three Months Ended September 30, 2021			Nine Months Ended September 30, 2021
	Number of Loans	Recorded Balance		Number of Loans	Recorded Balance
Commercial and industrial loans	2	$	160	2	$	160
Real estate loans:
Residential	5	599		5	599
Total	7	$	759	7	$	759

	Three Months Ended September 30, 2020			Nine Months Ended September 30, 2020
	Number of Loans	Recorded Balance		Number of Loans	Recorded Balance
Commercial and industrial loans	1	$	317	2	$	585
Real estate loans:
Commercial real estate, non owner occupied	1	106		1	106
Total	2	$	423	3	$	691

Schedule of changes in allowance for loan losses

The following tables summarize changes in the allowance for credit losses by loan segment for the three and nine months ended September 30, 2021:

	Three Months Ended September 30, 2021
	Commercial		Commercial Real Estate		Construction		Consumer & Residential		Total
Allowance for credit losses
Balances, June 30, 2021	$	63,681	$	72,701	$	17,077	$	46,316	$	199,775
Provision for credit losses	3,496		(3,850)		567		(213)		—
Recoveries on loans	204		370		—		261		835
Loans charged off	(137)		(115)		(4)		(382)		(638)
Balances, September 30, 2021	$	67,244	$	69,106	$	17,640	$	45,982	$	199,972

	Nine Months Ended September 30, 2021
	Commercial		Commercial Real Estate		Construction		Consumer		Residential		Consumer & Residential		Total
Allowance for credit losses
Balances, December 31, 2020	$	47,115	$	51,070	$	—	$	9,648	$	22,815	$	—	$	130,648
Credit risk reclassifications	—		(10,284)		10,284		(9,648)		(22,815)		32,463		—
Balances, December 31, 2020 after reclassifications	47,115		40,786		10,284		—		—		32,463		130,648
Impact of adopting ASC 326	20,024		34,925		8,805		—		—		10,301		74,055
Balances, January 1, 2021 Post-ASC 326 adoption	67,139		75,711		19,089		—		—		42,764		204,703
Provision for credit losses	666		(2,709)		(1,444)		—		—		3,487		—
Recoveries on loans	544		567		1		—		—		829		1,941
Loans charged off	(1,105)		(4,463)		(6)		—		—		(1,098)		(6,672)
Balances, September 30, 2021	$	67,244	$	69,106	$	17,640	$	—	$	—	$	45,982	$	199,972

Allowance for Loan Losses under prior GAAP ("Incurred Loss Model")

Prior to the adoption of ASU No. 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments on January 1, 2021, the Corporation maintained an allowance for loan losses in accordance with the incurred loss model as disclosed in the Corporation's 2020 Annual Report on Form 10-K.

The following tables summarize changes in the allowance for loan losses by loan segment for the three and nine months ended September 30, 2020:

	Three Months Ended September 30, 2020
	Commercial		Commercial Real Estate		Consumer		Residential		Total
Allowance for loan losses:
Balances, June 30, 2020	$	44,678	$	46,918	$	8,445	$	21,078	$	121,119
Provision for losses	7,299		2,990		971		1,284		12,544
Recoveries on loans	197		46		54		130		427
Loans charged off	(6,827)		—		(92)		(445)		(7,364)
Balances, September 30, 2020	$	45,347	$	49,954	$	9,378	$	22,047	$	126,726

	Nine Months Ended September 30, 2020
	Commercial		Commercial Real Estate		Consumer		Residential		Total
Allowance for loan losses:
Balances, December 31, 2019	$	32,902	$	28,778	$	4,035	$	14,569	$	80,284
Provision for losses	19,240		21,129		5,678		8,144		54,191
Recoveries on loans	746		271		152		248		1,417
Loans charged off	(7,541)		(224)		(487)		(914)		(9,166)
Balances, September 30, 2020	$	45,347	$	49,954	$	9,378	$	22,047	$	126,726

Schedule of allowance for credit losses and loan portfolio by loan segment

The table below shows the Corporation’s allowance for loan losses under the incurred loss model and loan portfolio by loan segment as of December 31, 2020.

	December 31, 2020
	Commercial		Commercial Real Estate		Consumer		Residential		Total
Allowance Balances:
Individually evaluated for impairment	$	223	$	12,246	$	—	$	432	$	12,901
Collectively evaluated for impairment	46,892		38,824		9,648		22,383		117,747
Total Allowance for Loan Losses	$	47,115	$	51,070	$	9,648	$	22,815	$	130,648
Loan Balances:
Individually evaluated for impairment	$	1,258	$	51,605	$	2	$	3,291	$	56,156
Collectively evaluated for impairment	3,505,863		3,805,808		129,477		1,739,709		9,180,857
Loans acquired with deteriorated credit quality	577		5,584		—		—		6,161
Loans	$	3,507,698	$	3,862,997	$	129,479	$	1,743,000	$	9,243,174

Schedule of composition of impaired loans by loan class

The following tables show the composition of the Corporation’s impaired loans, related allowance under the incurred loss model and interest income recognized while impaired by loan class as of the periods indicated:

	December 31, 2020
	Unpaid Principal Balance		Recorded Investment		Related Allowance
Impaired loans with no related allowance:
Commercial and industrial loans	$	1,059	$	991	$	—
Real estate Loans:
Commercial real estate, non-owner occupied	4,958		4,694		—
Commercial real estate, owner occupied	2,125		1,310		—
Residential	957		816		—
Individuals' loans for household and other personal expenditures	2		2		—
Total	$	9,101	$	7,813	$	—
Impaired loans with related allowance:
Commercial and industrial loans	$	268	$	268	$	223
Agricultural land, production and other loans to farmers	640		562		3
Real estate Loans:
Commercial real estate, non-owner occupied	44,016		43,715		11,686
Commercial real estate, owner occupied	2,061		1,323		557
Residential	2,041		2,014		352
Home equity	487		461		80
Total	$	49,513	$	48,343	$	12,901
Total Impaired Loans	$	58,614	$	56,156	$	12,901

	Three Months Ended September 30, 2020				Nine Months Ended September 30, 2020
	Average Recorded Investment		Interest Income Recognized		Average Recorded Investment		Interest Income Recognized
Impaired loans with no related allowance:
Commercial and industrial loans	$	8,625	$	—	$	9,225	$	—
Real estate Loans:
Commercial and farmland	10,812		37		11,059		113
Residential	58		1		59		2
Individuals' loans for household and other personal expenditures	3		—		3		—
Total	$	19,498	$	38	$	20,346	$	115
Impaired loans with related allowance:
Commercial and industrial loans	$	1,018	$	—	$	1,018	$	—
Real estate Loans:
Commercial and farmland	33,390		—		33,543		—
Residential	2,921		18		2,951		53
Home equity	482		4		488		11
Total	$	37,811	$	22	$	38,000	$	64
Total Impaired Loans	$	57,309	$	60	$	58,346	$	179

Schedule of financial instruments with off-balance sheet risk

Financial instruments with off-balance sheet risk were as follows:

	September 30, 2021		December 31, 2020
Amounts of commitments:
Loan commitments to extend credit	$	3,938,075	$	3,443,514
Standby letters of credit	$	33,986	$	29,555

Schedule of allowance for credit losses, off-balance sheet

The following table details activity in the allowance for credit losses on off-balance sheet commitments:

	Three Months Ended September 30, 2021
Balances, June 30, 2021	$	20,500
Provision for credit losses	—
Balances, September 30, 2021	$	20,500