Loans and Allowance for Credit Losses

The following table provides outstanding balances related to each of our loan types:



	June 30, 2017						December 31, 2016
	Originated		Acquired		Total		Originated		Acquired		Total
	(dollars in thousands)
Commercial, financial, agricultural and other	$	1,157,542	$	42,258	$	1,199,800	$	1,131,148	$	8,399	$	1,139,547
Real estate construction	237,035		12,220		249,255		217,840		1,781		219,621
Residential real estate	1,169,217		247,709		1,416,926		1,165,851		63,341		1,229,192
Commercial real estate	1,819,590		143,411		1,963,001		1,717,043		25,167		1,742,210
Loans to individuals	535,819		9,981		545,800		546,589		2,188		548,777
Total loans	$	4,919,203	$	455,579	$	5,374,782	$	4,778,471	$	100,876	$	4,879,347

Credit Quality Information

As part of the on-going monitoring of credit quality within the loan portfolio, the following credit worthiness categories are used in grading our loans:



Pass		Acceptable levels of risk exist in the relationship. Includes all loans not classified as OAEM, substandard or doubtful.



Other Assets Especially Mentioned (OAEM)		Potential weaknesses that deserve management’s close attention. The potential weaknesses may result in deterioration of the repayment prospects or weaken the Company’s credit position at some future date. The credit risk may be relatively minor, yet constitute an undesirable risk in light of the circumstances surrounding the specific credit. No loss of principal or interest is expected.



Substandard		Well-defined weakness or a weakness that jeopardizes the repayment of the debt. A loan may be classified as substandard as a result of deterioration of the borrower’s financial condition and repayment capacity. Loans for which repayment plans have not been met or collateral equity margins do not protect the Company may also be classified as substandard.



Doubtful		Loans with the characteristics of substandard loans with the added characteristic that collection or liquidation in full, on the basis of presently existing facts and conditions, is highly improbable.

The use of creditworthiness categories to grade loans permits management’s use of migration analysis to estimate a portion of credit risk. The Company’s internal creditworthiness grading system provides a measurement of credit risk based primarily on an evaluation of the borrower’s cash flow and collateral. Movement between these rating categories provides a predictive measure of credit losses and therefore assists in determining the appropriate level for the loan loss reserves. Category ratings are reviewed each quarter, at which time management analyzes the results, as well as other external statistics and factors related to loan performance. Loans that migrate towards higher risk rating levels generally have an increased risk of default, whereas loans that migrate toward lower risk ratings generally will result in a lower risk factor being applied to those related loan balances.

The following tables represent our credit risk profile by creditworthiness:



	June 30, 2017
	Commercial, financial, agricultural and other		Real estate construction		Residential real estate		Commercial real estate		Loans to individuals		Total
	(dollars in thousands)
Originated loans
Pass	$	1,076,627	$	237,035	$	1,155,603	$	1,767,348	$	535,611	$	4,772,224
Non-Pass
OAEM	47,113		—		3,076		34,630		—		84,819
Substandard	28,828		—		10,538		17,612		208		57,186
Doubtful	4,974		—		—		—		—		4,974
Total Non-Pass	80,915		—		13,614		52,242		208		146,979
Total	$	1,157,542	$	237,035	$	1,169,217	$	1,819,590	$	535,819	$	4,919,203

Acquired loans
Pass	$	40,132	$	12,220	$	245,180	$	134,825	$	9,981	$	442,338
Non-Pass
OAEM	1,193		—		942		3,518		—		5,653
Substandard	933		—		1,587		5,068		—		7,588
Doubtful	—		—		—		—		—		—
Total Non-Pass	2,126		—		2,529		8,586		—		13,241
Total	$	42,258	$	12,220	$	247,709	$	143,411	$	9,981	$	455,579



	December 31, 2016
	Commercial, financial, agricultural and other		Real estate construction		Residential real estate		Commercial real estate		Loans to individuals		Total
	(dollars in thousands)
Originated loans
Pass	$	1,038,844	$	217,565	$	1,152,511	$	1,691,220	$	546,316	$	4,646,456
Non-Pass
OAEM	27,387		275		5,923		7,596		—		41,181
Substandard	64,917		—		7,417		18,227		273		90,834
Doubtful	—		—		—		—		—		—
Total Non-Pass	92,304		275		13,340		25,823		273		132,015
Total	$	1,131,148	$	217,840	$	1,165,851	$	1,717,043	$	546,589	$	4,778,471

Acquired loans
Pass	$	7,591	$	1,781	$	62,919	$	24,043	$	2,185	$	98,519
Non-Pass
OAEM	486		—		—		—		—		486
Substandard	322		—		422		1,124		3		1,871
Doubtful	—		—		—		—		—		—
Total Non-Pass	808		—		422		1,124		3		2,357
Total	$	8,399	$	1,781	$	63,341	$	25,167	$	2,188	$	100,876

Portfolio Risks

The credit quality of our loan portfolio can potentially represent significant risk to our earnings, capital and liquidity. First Commonwealth devotes substantial resources to managing this risk primarily through our credit administration department that develops and administers policies and procedures for underwriting, maintaining, monitoring and collecting loans. Credit administration is independent of our lending departments and oversight is provided by the credit committee of the First Commonwealth Board of Directors.

Criticized loans have been evaluated when determining the appropriateness of the allowance for credit losses, which we believe is adequate to absorb losses inherent to the portfolio as of June 30, 2017. However, changes in economic conditions, interest rates, borrower financial condition, delinquency trends or previously established fair values of collateral factors could significantly change those judgmental estimates.

Age Analysis of Past Due Loans by Segment

The following tables delineate the aging analysis of the recorded investments in past due loans as of June 30, 2017 and December 31, 2016. Also included in these tables are loans that are 90 days or more past due and still accruing because they are well-secured and in the process of collection.



	June 30, 2017
	30 - 59 days past due		60 - 89 days past due		90 days and greater and still accruing		Nonaccrual		Total past due and nonaccrual		Current		Total
	(dollars in thousands)
Originated loans
Commercial, financial, agricultural and other	$	1,864	$	88	$	48	$	12,561	$	14,561	$	1,142,981	$	1,157,542
Real estate construction	—		—		—		—		—		237,035		237,035
Residential real estate	3,325		1,189		1,015		6,363		11,892		1,157,325		1,169,217
Commercial real estate	863		166		5		3,802		4,836		1,814,754		1,819,590
Loans to individuals	1,487		615		712		208		3,022		532,797		535,819
Total	$	7,539	$	2,058	$	1,780	$	22,934	$	34,311	$	4,884,892	$	4,919,203

Acquired loans
Commercial, financial, agricultural and other	$	—	$	—	$	—	$	563	$	563	$	41,695	$	42,258
Real estate construction	—		—		—		—		—		12,220		12,220
Residential real estate	68		133		106		626		933		246,776		247,709
Commercial real estate	—		—		—		3,298		3,298		140,113		143,411
Loans to individuals	65		27		12		—		104		9,877		9,981
Total	$	133	$	160	$	118	$	4,487	$	4,898	$	450,681	$	455,579



	December 31, 2016
	30 - 59 days past due		60 - 89 days past due		90 days and greater and still accruing		Nonaccrual		Total past due and nonaccrual		Current		Total
	(dollars in thousands)
Originated loans
Commercial, financial, agricultural and other	$	2,380	$	171	$	75	$	17,928	$	20,554	$	1,110,594	$	1,131,148
Real estate construction	183		—		—		—		183		217,657		217,840
Residential real estate	4,133		1,089		995		5,792		12,009		1,153,842		1,165,851
Commercial real estate	265		327		57		3,443		4,092		1,712,951		1,717,043
Loans to individuals	1,640		776		970		273		3,659		542,930		546,589
Total	$	8,601	$	2,363	$	2,097	$	27,436	$	40,497	$	4,737,974	$	4,778,471

Acquired loans
Commercial, financial, agricultural and other	$	486	$	—	$	—	$	—	$	486	$	7,913	$	8,399
Real estate construction	—		—		—		—		—		1,781		1,781
Residential real estate	148		39		34		422		643		62,698		63,341
Commercial real estate	—		—		—		162		162		25,005		25,167
Loans to individuals	1		7		—		3		11		2,177		2,188
Total	$	635	$	46	$	34	$	587	$	1,302	$	99,574	$	100,876

Nonaccrual Loans

The previous tables summarize nonaccrual loans by loan segment. The Company generally places loans on nonaccrual status when the full and timely collection of interest or principal becomes uncertain, when part of the principal balance has been charged off and no restructuring has occurred, or the loans reach a certain number of days past due. Generally, loans 90 days or more past due are placed on nonaccrual status, except for consumer loans, which are placed on nonaccrual status at 150 days past due.

When a loan is placed on nonaccrual, the accrued unpaid interest receivable is reversed against interest income and all future payments received are applied as a reduction to the loan principal. Generally, the loan is returned to accrual status when (a) all delinquent interest and principal becomes current under the terms of the loan agreement or (b) the loan is both well-secured and in the process of collection and collectability is no longer in doubt.

Impaired Loans

Management considers loans to be impaired when, based on current information and events, it is determined that the Company will not be able to collect all amounts due according to the loan contract, including scheduled interest payments. Determination of impairment is treated the same across all loan categories. When management identifies a loan as impaired, the impairment is measured based on the present value of expected future cash flows, discounted at the loan’s effective interest rate, except when the sole source for repayment of the loan is the operation or liquidation of collateral. When the loan is collateral dependent, the appraised value less estimated cost to sell is utilized. If management determines the value of the impaired loan is less than the recorded investment in the loan, impairment is recognized through an allowance estimate or a charge-off to the allowance. Troubled debt restructured loans on accrual status are also considered to be impaired loans.

When the ultimate collectability of the total principal of an impaired loan is in doubt and the loan is on nonaccrual status, all payments are applied to principal under the cost recovery method. When the ultimate collectability of the total principal of an impaired loan is not in doubt and the loan is on nonaccrual status, contractual interest is credited to interest income when received under the cash basis method.

At June 30, 2017 and December 31, 2016, there were no nonaccrual loans held for sale. In addition, $21 thousand in gains were recognized in income during the second quarter of 2017 as the result of the sale of a nonaccrual loan held for sale at March 31, 2017. There were no gains or losses recognized in income for the six months ended June 30, 2016.

Significant nonaccrual loans as of June 30, 2017, include the following:


•	A $5.0 million relationship of commercial industrial loans to a steel and aluminum servicing company. These loans were originated in 2011 and were placed in nonaccrual status during the first quarter of 2016. During the second quarter of 2017, a restructuring agreement resulted in payments of $2.4 million on these loans. A collateral valuation was completed in the second quarter of 2017.

•

A $2.8 million relationship of commercial industrial loans to a local energy company involved in the drilling and production of natural gas wells. These loans were originated from 2008 to 2011 and were placed in nonaccrual status during the third quarter of 2013. Two of these loans were modified resulting in TDR classification: one loan totaling $0.6 million was modified in 2012, and the other loan totaling $2.2 million was modified in 2014. Charge-offs totaling $0.4 million were recognized in the first six months of 2017. A valuation of the collateral was updated during the first quarter of 2017.


•	A $2.1 million commercial real estate loan to a property manager. This loan was acquired as part of the DCB acquisition. A valuation of the collateral was completed during the second quarter of 2017.

The following tables include the recorded investment and unpaid principal balance for impaired loans with the associated allowance amount, if applicable, as of June 30, 2017 and December 31, 2016. Also presented are the average recorded investment in impaired loans and the related amount of interest recognized while the loan was considered impaired. Average balances are calculated using month-end balances of the loans for the period reported and are included in the table below based on their period-end allowance position.



	June 30, 2017						December 31, 2016
	Recorded investment		Unpaid principal balance		Related allowance		Recorded investment		Unpaid principal balance		Related allowance
	(dollars in thousands)
Originated loans:
With no related allowance recorded:
Commercial, financial, agricultural and other	$	8,290	$	14,697			$	9,549	$	15,369
Real estate construction	—		—				—		—
Residential real estate	11,128		12,975				10,873		13,004
Commercial real estate	6,524		7,498				5,765		6,905
Loans to individuals	341		391				382		507
Subtotal	26,283		35,561				26,569		35,785
With an allowance recorded:
Commercial, financial, agricultural and other	8,634		12,699		$	1,681	13,423		19,226		$	2,530
Real estate construction	—		—		—		—		—		—
Residential real estate	342		459		31		424		475		164
Commercial real estate	428		427		259		810		810		434
Loans to individuals	—		—		—		—		—		—
Subtotal	9,404		13,585		1,971		14,657		20,511		3,128
Total	$	35,687	$	49,146	$	1,971	$	41,226	$	56,296	$	3,128



	June 30, 2017						December 31, 2016
	Recorded investment		Unpaid principal balance		Related allowance		Recorded investment		Unpaid principal balance		Related allowance
	(dollars in thousands)
Acquired loans
With no related allowance recorded:
Commercial, financial, agricultural and other	$	72	$	72			$	—	$	—
Real estate construction	—		—				—		—
Residential real estate	624		943				406		480
Commercial real estate	3,140		4,012				162		162
Loans to individuals	—		—				3		3
Subtotal	3,836		5,027				571		645
With an allowance recorded:
Commercial, financial, agricultural and other	490		490		$	110	—		—		$	—
Real estate construction	—		—		—		—		—		—
Residential real estate	14		28		4		16		16		16
Commercial real estate	158		162		50		—		—		—
Loans to individuals	—		—		—		—		—		—
Subtotal	662		680		164		16		16		16
Total	$	4,498	$	5,707	$	164	$	587	$	661	$	16



	For the Six Months Ended June 30,
	2017								2016
	Originated Loans				Acquired Loans				Originated Loans
	Average recorded investment		Interest income recognized		Average recorded investment		Interest income recognized		Average recorded investment		Interest income recognized
	(dollars in thousands)
With no related allowance recorded:
Commercial, financial, agricultural and other	$	13,888	$	289	$	36	$	—	$	20,116	$	249
Real estate construction	—		—		50		—		9		44
Residential real estate	11,434		185		465		7		11,232		137
Commercial real estate	6,586		88		1,575		—		7,136		67
Loans to individuals	341		11		—		—		442		3
Subtotal	32,249		573		2,126		7		38,935		500
With an allowance recorded:
Commercial, financial, agricultural and other	9,220		46		82		—		17,939		91
Real estate construction	—		—		—		—		—		—
Residential real estate	279		—		7		—		347		—
Commercial real estate	484		13		161		—		861		11
Loans to individuals	—		—		—		—		—		—
Subtotal	9,983		59		250		—		19,147		102
Total	$	42,232	$	632	$	2,376	$	7	$	58,082	$	602



	For the Three Months Ended June 30,
	2017								2016
	Originated Loans				Acquired Loans				Originated Loans
	Average recorded investment		Interest Income Recognized		Average recorded investment		Interest Income Recognized		Average recorded investment		Interest Income Recognized
	(dollars in thousands)
With no related allowance recorded:
Commercial, financial, agricultural and other	$	12,583	$	251	$	72	$	—	$	18,995	$	95
Real estate construction	—		—		100		—		—		—
Residential real estate	11,339		110		623		7		11,462		90
Commercial real estate	6,596		34		3,151		—		6,887		29
Loans to individuals	344		9		—		—		405		2
Subtotal	30,862		404		3,946		7		37,749		216
With an allowance recorded:
Commercial, financial, agricultural and other	8,813		20		164		—		22,788		65
Real estate construction	—		—		—		—		—		—
Residential real estate	332		—		14		—		476		—
Commercial real estate	481		6		160		—		921		6
Loans to individuals	—		—		—		—		—		—
Subtotal	9,626		26		338		—		24,185		71
Total	$	40,488	$	430	$	4,284	$	7	$	61,934	$	287

Unfunded commitments related to nonperforming loans were $1.5 million at June 30, 2017 and $1.8 million at December 31, 2016. After consideration of the requirements to draw and available collateral related to these commitments, a reserve of $0.1 million and $12 thousand was established for these off balance sheet exposures at June 30, 2017 and December 31, 2016, respectively.

Troubled debt restructured loans are those loans whose terms have been renegotiated to provide a reduction or deferral of principal or interest as a result of the financial difficulties experienced by the borrower, who could not obtain comparable terms from alternate financing sources.

The following table provides detail as to the total troubled debt restructured loans and total commitments outstanding on troubled debt restructured loans:



	June 30, 2017		December 31, 2016
	(dollars in thousands)
Troubled debt restructured loans
Accrual status	$	12,764	$	13,790
Nonaccrual status	11,868		11,569
Total	$	24,632	$	25,359
Commitments
Letters of credit	$	60	$	—
Unused lines of credit	87		358
Total	$	147	$	358

The following tables provide detail, including specific reserves and reasons for modification, related to loans identified as troubled debt restructurings:



	For the Six Months Ended June 30, 2017
		Type of Modification
	Number of Contracts	Extend Maturity		Modify Rate		Modify Payments		Total Pre-Modification Outstanding Recorded Investment		Post- Modification Outstanding Recorded Investment		Specific Reserve
	(dollars in thousands)
Commercial, financial, agricultural and other	4	$	6,768	$	1,786	$	—	$	8,554	$	6,422	$	960
Residential real estate	12	129		187		413		729		683		4
Commercial real estate	3	179		—		84		263		258		—
Loans to individuals	7	—		17		48		65		56		—
Total	26	$	7,076	$	1,990	$	545	$	9,611	$	7,419	$	964



	For the Six Months Ended June 30, 2016
		Type of Modification
	Number of Contracts	Extend Maturity		Modify Rate		Modify Payments		Total Pre-Modification Outstanding Recorded Investment		Post- Modification Outstanding Recorded Investment		Specific Reserve
	(dollars in thousands)
Commercial, financial, agricultural and other	5	$	92	$	4,009	$	—	$	4,101	$	3,708	$	40
Residential real estate	26	—		114		2,416		2,530		2,440		—
Commercial real estate	6	1,264		—		25		1,289		1,227		74
Loans to individuals	5	—		29		11		40		30		—
Total	42	$	1,356	$	4,152	$	2,452	$	7,960	$	7,405	$	114

The troubled debt restructurings included in the above tables are also included in the impaired loan tables provided earlier in this note. Loans defined as modified due to a change in rate may include loans that were modified for a change in rate as well as a re-amortization of the principal and an extension of the maturity. For the six months ended June 30, 2017 and 2016, $0.2 million and $4.2 million, respectively, of total rate modifications represent loans with modifications to the rate as well as payment as a result of re-amortization. For both 2017 and 2016 the changes in loan balances between the pre-modification balance and the post-modification balance are due to customer payments.



	For the Three Months Ended June 30, 2017
		Type of Modification
	Number of Contracts	Extend Maturity		Modify Rate		Modify Payments		Total Pre-Modification Outstanding Recorded Investment		Post- Modification Outstanding Recorded Investment		Specific Reserve
	(dollars in thousands)
Commercial, financial, agricultural and other	3	$	6,768	$	1,745	$	—	$	8,513	$	6,385	$	960
Residential real estate	5	—		85		108		193		189		4
Commercial real estate	1	—		—		68		68		68		—
Loans to individuals	4	—		3		17		20		17		—
Total	13	$	6,768	$	1,833	$	193	$	8,794	$	6,659	$	964



	For the Three Months Ended, June 30, 2016
		Type of Modification
	Number of Contracts	Extend Maturity		Modify Rate		Modify Payments		Total Pre-Modification Outstanding Recorded Investment		Post- Modification Outstanding Recorded Investment		Specific Reserve
	(dollars in thousands)
Commercial, financial, agricultural and other	4	$	92	$	240	$	—	$	332	$	217	$	40
Residential real estate	17	—		—		1,435		1,435		1,428		—
Commercial real estate	4	1,198		—		—		1,198		1,173		74
Loans to individuals	2	—		11		6		17		15		—
Total	27	$	1,290	$	251	$	1,441	$	2,982	$	2,833	$	114

The troubled debt restructurings included in the above tables are also included in the impaired loan tables provided earlier in this note. Loans defined as modified due to a change in rate may include loans that were modified for a change in rate as well as a re-amortization of the principal and an extension of the maturity. For the three months ended June 30, 2017 and 2016, $0.1 million and $0.3 million, respectively, of total rate modifications represent loans with modifications to the rate as well as payment as a result of re-amortization. For both 2017 and 2016 the changes in loan balances between the pre-modification balance and the post-modification balance are due to customer payments.

A troubled debt restructuring is considered to be in default when a restructured loan is 90 days or more past due. The following table provides information related to restructured loans that were considered to be in default during the six months ended June 30:



	2017			2016
	Number of Contracts	Recorded Investment		Number of Contracts	Recorded Investment
	(dollars in thousands)
Residential real estate	4	$	103	—	$	—
Total	4	$	103	—	$	—

The following table provides information related to restructured loans that were considered to be in default during the three months ended June 30:



	2017			2016
	Number of Contracts	Recorded Investment		Number of Contracts	Recorded Investment
	(dollars in thousands)
Residential real estate	4	$	103	—	$	—
Total	4	$	103	—	$	—

The following tables provide detail related to the allowance for credit losses:



	For the Six Months Ended June 30, 2017
	Commercial, financial, agricultural and other				Real estate construction			Residential real estate			Commercial real estate			Loans to individuals			Total
	(dollars in thousands)
Allowance for credit losses:
Originated loans:
Beginning balance	$	35,974			$	577		$	2,492		$	6,619		$	4,504		$	50,166
Charge-offs	(5,277		)		—			(610		)	(60		)	(2,170		)	(8,117		)
Recoveries	3,636				96			192			146			248			4,318
Provision (credit)	(961		)		95			42			602			1,750			1,528
Ending balance	33,372				768			2,116			7,307			4,332			47,895
Acquired loans:
Beginning balance	—				—			19			—			—			19
Charge-offs	—				—			(9		)	—			(8		)	(17		)
Recoveries	—			—	1			27			4			46			78
Provision (credit)	118				(1		)	(33		)	46			(38		)	92
Ending balance	118				—			4			50			—			172
Total ending balance	$	33,490			$	768		$	2,120		$	7,357		$	4,332		$	48,067
Ending balance: individually evaluated for impairment	$	1,791			$	—		$	35		$	309		$	—		$	2,135
Ending balance: collectively evaluated for impairment	31,699				768			2,085			7,048			4,332			45,932
Loans:
Ending balance	1,199,800				249,255			1,416,926			1,963,001			545,800			5,374,782
Ending balance: individually evaluated for impairment	16,917				—			6,978			8,697			—			32,592
Ending balance: collectively evaluated for impairment	1,182,883				249,255			1,409,948			1,954,304			545,800			5,342,190



	For the Six Months Ended June 30, 2016
	Commercial, financial, agricultural and other			Real estate construction			Residential real estate			Commercial real estate			Loans to individuals			Total
	(dollars in thousands)
Allowance for credit losses:
Beginning balance	$	31,035		$	887		$	2,606		$	11,924		$	4,360		$	50,812
Charge-offs	(6,145		)	—			(602		)	(408		)	(2,491		)	(9,646		)
Recoveries	198			227			260			783			289			1,757
Provision (credit)	21,269			(634		)	341			(6,437		)	2,359			16,898
Ending balance	$	46,357		$	480		$	2,605		$	5,862		$	4,517		$	59,821
Ending balance: individually evaluated for impairment	$	15,018		$	—		$	48		$	464		$	—		$	15,530
Ending balance: collectively evaluated for impairment	31,339			480			2,557			5,398			4,517			44,291
Loans:
Ending balance	1,185,062			242,132			1,199,005			1,648,222			569,355			4,843,776
Ending balance: individually evaluated for impairment	43,817			—			5,966			6,017			—			55,800
Ending balance: collectively evaluated for impairment	1,141,245			242,132			1,193,039			1,642,205			569,355			4,787,976



	For the Three Months Ended June 30, 2017
	Commercial, financial, agricultural and other			Real estate construction			Residential real estate			Commercial real estate			Loans to individuals			Total
	(dollars in thousands)
Allowance for credit losses:
Originated loans:
Beginning balance	$	34,701		$	614		$	2,414		$	6,582		$	4,334		$	48,645
Charge-offs	(1,452		)	—			(145		)	(29		)	(972		)	(2,598		)
Recoveries	3,268			42			70			29			120			3,529
Provision (credit)	(3,145		)	112			(223		)	725			850			(1,681		)
Ending balance	33,372			768			2,116			7,307			4,332			47,895
Acquired loans:
Beginning balance	—			—			31			—			—			31
Charge-offs	—			—			(1		)	—			(1		)	(2		)
Recoveries	—			1			21			4			45			71
Provision (credit)	118			(1		)	(47		)	46			(44		)	72
Ending balance	118			—			4			50			—			172
Total ending balance	$	33,490		$	768		$	2,120		$	7,357		$	4,332		$	48,067



	For the Three Months Ended, June 30, 2016
	Commercial, financial, agricultural and other			Real estate construction			Residential real estate			Commercial real estate			Loans to individuals			Total
	(dollars in thousands)
Allowance for credit losses:
Beginning balance	$	41,721		$	901		$	2,628		$	5,483		$	4,489		$	55,222
Charge-offs	(4,753		)	—			(220		)	(143		)	(1,022		)	(6,138		)
Recoveries	64			4			142			27			128			365
Provision (credit)	9,325			(425		)	55			495			922			10,372
Ending balance	$	46,357		$	480		$	2,605		$	5,862		$	4,517		$	59,821