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ALLOWANCE FOR CREDIT LOSSES AND CREDIT QUALITY
 6 Months Ended
Jun. 30, 2021
ALLOWANCE FOR CREDIT LOSSES AND CREDIT QUALITY  
ALLOWANCE FOR CREDIT LOSSES AND CREDIT QUALITY ALLOWANCE FOR CREDIT LOSSES AND CREDIT QUALITY
The Company adopted ASC 326 using the modified retrospective method for all financial assets measured at amortized cost. Results for reporting periods beginning after January 1, 2021 are presented under ASC 326 while prior period amounts continue to be reported in accordance with previously applicable GAAP.
The Company maintains an allowance for credit losses to provide for expected credit losses. Losses are charged against the allowance when management believes that the principal is uncollectable. Subsequent recoveries, if any, are credited to the allowance. Allocations of the allowance are made for specific loans and for pools of similar types of loans, although the entire allowance is available for any loan that, in management’s judgment, should be charged against the allowance. A provision for credit losses is taken based on management’s ongoing evaluation of the appropriate allowance balance. A formal evaluation of the adequacy of the credit loss allowance is conducted monthly. The ultimate recovery of all loans is susceptible to future market factors beyond the Company’s control.
The level of credit loss provision is influenced by growth in the overall loan portfolio, emerging market risk, emerging concentration risk, commercial loan focus and large credit concentration, new industry lending activity, general economic conditions and historical loss analysis. In addition, management gives consideration to changes in the facts and circumstances of watch list credits, which includes the security position of the borrower, in determining the appropriate level of the credit loss provision. Furthermore, management’s overall view on credit quality is a factor in the determination of the provision.
The determination of the appropriate allowance is inherently subjective, as it requires significant estimates by management. The Company has an established process to determine the adequacy of the allowance for credit losses that generally includes consideration of changes in the nature and volume of the loan portfolio, overall portfolio quality, along with current and forecasted economic conditions that may affect borrowers’ ability to repay. Consideration is not limited to these factors although they represent the most commonly cited factors. To determine the specific allocation levels for individual credits, management considers the current valuation of collateral and the amounts and timing of expected future cash flows as the primary measures. Management also considers trends in adversely classified loans based upon an ongoing review of those credits. With respect to pools of similar loans, an appropriate level of general allowance is determined by portfolio segment using a probability of default-loss given default (“PD/LGD”) model, subject to a floor. A default can be triggered by one of several different asset quality factors, including past due status, nonaccrual status, TDR status or if the loan has had a charge-off. This PD is then combined with a LGD derived from historical charge-off data to construct a default rate. This loss rate is then supplemented with adjustments for reasonable and supportable forecasts of relevant economic indicators, particularly the unemployment rate forecast from the Federal Open Market Committee’s Summary of Economic Projections, and other environmental factors based on the risks present for each portfolio segment. These environmental factors include consideration of the following: levels of, and trends in, delinquencies and nonperforming loans; trends in volume and terms of loans; effects of any changes in risk selection and underwriting standards; other changes in lending policies, procedure, and practices; experience, ability, and depth of lending management and other relevant staff; national and local economic trends and conditions; industry conditions; and effects of changes in credit concentrations. It is also possible that these factors could include social, political, economic, and terrorist events or activities. All of these factors are susceptible to change, which may be significant. As a result of this detailed process, the allowance results in two forms of allocations, specific and general. These two components represent the total allowance for credit losses deemed adequate to cover probable losses inherent in the loan portfolio.
Commercial loans are subject to a dual standardized grading process administered by the credit administration function. These grade assignments are performed independent of each other and a consensus is reached by credit administration and the loan review officer. Specific allowances are established in cases where management has identified significant conditions or circumstances related to an individual credit that indicate it should be evaluated on an individual basis. Considerations with respect to specific allocations for these individual credits include, but are not limited to, the following: (a) the sufficiency of the customer’s cash flow or net worth to repay the loan; (b) the adequacy of the discounted value of collateral relative to the loan balance; (c) whether the loan has been criticized in a regulatory examination; (d) whether the loan is nonperforming; (e) any other reasons the ultimate collectability of the loan may be in question; or (f) any unique loan characteristics that require special monitoring.
Allocations are also applied to categories of loans considered not to be individually analyzed, but for which the rate of loss is expected to be consistent with or greater than historical averages. Such allocations are based on past loss experience and information about specific borrower situations and estimated collateral values. These general pooled loan allocations are performed for portfolio segments of commercial and industrial; commercial real estate, multi-family, and construction; agri-business and agricultural; other commercial loans; and consumer 1-4 family mortgage and other consumer loans. General allocations of the allowance are determined by a historical loss rate based on the calculation of each pool’s probability of
default-loss given default, subject to a floor. The length of the historical period for each pool is based on the average life of the pool. The historical loss rates are supplemented with consideration of economic conditions and portfolio trends.
Due to the imprecise nature of estimating the allowance for credit losses, the Company’s allowance for credit losses includes an unallocated component. The unallocated component of the allowance for credit losses incorporates the Company’s judgmental determination of potential expected losses that may not be fully reflected in other allocations, including factors such as the level of classified credits, economic uncertainties, industry trends impacting specific portfolio segments, broad portfolio quality trends, and trends in the composition of the Company’s large commercial loan portfolio and related large dollar exposures to individual borrowers. As a practical expedient, the Company has elected to treat accrued interest the same way it is treated in the incurred loss model, wherein it is stated separately from loan principal balances on the consolidated balance sheet. Additionally, when a loan is placed on non-accrual, interest payments will be reversed through interest income, which is consistent with current practice.
For off balance sheet credit exposures outlined in the ASU at 326-20-30-11, it is the Company’s position that nearly all of the unfunded amounts on lines of credit are unconditionally cancellable, and therefore not subject to having a liability set up, which matches the current accounting conclusion in the incurred loss environment.
The following tables present the activity in the allowance for credit losses by portfolio segment for the three-month period ended June 30, 2021:
(dollars in thousands)Commercial and IndustrialCommercial Real Estate and Multifamily ResidentialAgri-business and AgriculturalOther CommercialConsumer 1-4 Family MortgageOther ConsumerUnallocatedTotal
Three Months Ended June 30, 2021                
Beginning balance, April 1$32,052 $29,445 $3,901 $1,172 $3,384 $1,293 $597 $71,844 
Provision for credit losses(187)(1,160)(291)126 (221)124 (91)(1,700)
Loans charged-off(162)0 0 0 (32)(73)0 (267)
Recoveries1,427 6 320 0 34 49 0 1,836 
Net loans charged-off1,265 6 320 0 2 (24)0 1,569 
Ending balance$33,130 $28,291 $3,930 $1,298 $3,165 $1,393 $506 $71,713 
The following tables present the activity in the allowance for credit losses by portfolio segment for the six-month period ended June 30, 2021:
(dollars in thousands)Commercial and IndustrialCommercial Real Estate and Multifamily ResidentialAgri-business and AgriculturalOther CommercialConsumer 1-4 Family MortgageOther ConsumerUnallocatedTotal
Six Months Ended June 30, 2021                
Beginning balance, January 1$28,333 $22,907 $3,043 $416 $2,619 $951 $3,139 $61,408 
Impact of adopting ASC 3264,312 4,316 1,060 941 953 349 (2,881)9,050 
Provision for credit losses(727)1,125 (493)(59)(454)137 248 (223)
Loans charged-off(249)(71)0 0 (38)(145)0 (503)
Recoveries1,461 14 320 0 85 101 0 1,981 
Net loans charged-off1,212 (57)320 0 47 (44)0 1,478 
Ending balance$33,130 $28,291 $3,930 $1,298 $3,165 $1,393 $506 $71,713 
Credit Quality Indicators:
The Company categorizes loans into risk categories based on relevant information about the ability of borrowers to service their debt such as: current financial information, historical payment experience, credit documentation, public information and current economic trends, among other factors. The Company analyzes commercial loans individually by classifying the loans as to credit risk. This analysis is performed on a quarterly basis for Special Mention, Substandard and Doubtful grade loans and annually on Pass grade loans over $250,000.
The Company uses the following definitions for risk ratings:
Special Mention. Loans classified as Special Mention have a potential weakness that deserves management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or of the institution’s credit position at some future date.
Substandard. Loans classified as Substandard are inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged, if any. Loans so classified have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the Company will sustain some loss if the deficiencies are not corrected.
Doubtful. Loans classified as Doubtful have all the weaknesses inherent in those classified as Substandard, with the added characteristics that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions, and values, highly questionable and improbable.
Loans not meeting the criteria above that are analyzed individually as part of the above-described process are considered to be “Pass” rated loans with the exception of consumer troubled debt restructurings which are evaluated and listed with Substandard commercial grade loans and consumer nonaccrual loans which are evaluated individually and listed with “Not Rated” loans. Loans listed as Not Rated are consumer loans or commercial loans with consumer characteristics included in groups of homogenous loans which are analyzed for credit quality indicators utilizing delinquency status.
The following table summarizes the risk category of loans by loan segment and origination date as of June 30, 2021:
(dollars in thousands)20212020201920182017PriorTerm TotalRevolvingTotal
Commercial and industrial loans:                  
Working capital lines of credit loans:                  
Pass$4,222 $7,057 $13,084 $2,002 $998 $505 $27,868 $494,580 $522,448 
Special Mention0 0 0 0 0 0 0 72,310 72,310 
Substandard0 0 86 0 173 0 259 21,482 21,741 
Total4,222 7,057 13,170 2,002 1,171 505 28,127 588,372 616,499 
Non-working capital loans:
Pass231,811 212,502 95,064 75,452 28,365 23,923 667,117 163,284 830,401 
Special Mention3,108 4,038 809 1,434 2,849 1,210 13,448 2,956 16,404 
Substandard4,300 6,734 1,320 4,678 6,236 645 23,913 3,355 27,268 
Not Rated1,261 2,235 1,004 864 274 44 5,682 0 5,682 
Total240,480 225,509 98,197 82,428 37,724 25,822 710,160 169,595 879,755 
Commercial real estate and multi-family residential loans:
Construction and land development loans:
Pass16,908 43,152 4,359 57,266 1,501 16,974 140,160 261,048 401,208 
Owner occupied loans:
Pass73,686 180,146 68,583 82,093 86,853 103,342 594,703 40,081 634,784 
Special Mention6,360 0 2,149 1,399 18,903 2,043 30,854 0 30,854 
Substandard0 2,004 1,072 2,106 719 931 6,832 0 6,832 
Total80,046 182,150 71,804 85,598 106,475 106,316 632,389 40,081 672,470 
Nonowner occupied loans:
Pass50,958 170,784 145,168 41,276 42,698 83,682 534,566 39,656 574,222 
Special Mention6,891 373 643 0 0 20,001 27,908 0 27,908 
Substandard0 0 0 3,381 0 0 3,381 0 3,381 
Total57,849 171,157 145,811 44,657 42,698 103,683 565,855 39,656 605,511 
Multifamily loans:
Pass35,494 92,421 79,132 14,759 17,083 24,610 263,499 14,338 277,837 
Special Mention0 0 0 0 22,252 0 22,252 0 22,252 
Total35,494 92,421 79,132 14,759 39,335 24,610 285,751 14,338 300,089 
Agri-business and agricultural loans:
Loans secured by farmland:
Pass29,377 39,963 19,765 16,211 11,527 22,520 139,363 22,027 161,390 
Special Mention0 1,985 2,355 0 190 30 4,560 958 5,518 
Substandard0 216 0 0 0 145 361 0 361 
Total29,377 42,164 22,120 16,211 11,717 22,695 144,284 22,985 167,269 
Loans for agricultural production:
Pass5,240 31,307 9,408 30,310 1,704 6,730 84,699 76,772 161,471 
Special Mention480 8,647 1,267 0 52 19 10,465 7,474 17,939 
Total5,720 39,954 10,675 30,310 1,756 6,749 95,164 84,246 179,410 
Other commercial loans:
Pass575 29,814 5,379 2,419 9,648 9,538 57,373 23,797 81,170 
Special Mention0 0 0 0 0 4,091 4,091 0 4,091 
Total575 29,814 5,379 2,419 9,648 13,629 61,464 23,797 85,261 
Consumer 1-4 family mortgage loans:
Closed end first mortgage loans
Pass5,000 18,106 6,470 7,046 3,737 2,996 43,355 3,890 47,245 
Substandard0 0 0 0 14 3,309 3,323 0 3,323 
Not Rated20,333 30,192 11,879 12,586 12,363 30,845 118,198 589 118,787 
Total25,333 48,298 18,349 19,632 16,114 37,150 164,876 4,479 169,355 
Open end and junior lien loans
Pass101 452 163 346 0 31 1,093 11,974 13,067 
Substandard0 0 0 0 0 0 0 98 98 
Not Rated8,464 7,781 7,893 5,864 3,136 2,103 35,241 115,473 150,714 
Total8,565 8,233 8,056 6,210 3,136 2,134 36,334 127,545 163,879 
Residential construction loans
Not Rated5,864 3,940 1,028 257 174 1,191 12,454 0 12,454 
Other consumer loans
Pass1,802 6,029 1,633 0 1,327 0 10,791 24,443 35,234 
Substandard0 0 253 0 0 0 253 0 253 
Not Rated12,728 19,224 9,998 8,388 3,125 1,729 55,192 9,870 65,062 
Total14,530 25,253 11,884 8,388 4,452 1,729 66,236 34,313 100,549 
TOTAL$524,963 $919,102 $489,964 $370,137 $275,901 $363,187 $2,943,254 $1,410,455 $4,353,709 
As of June 30, 2021, $194.2 million in PPP loans were included in the "Pass" category of non-working capital commercial and industrial loans. These loans were included in this risk rating category because they are fully guaranteed by the Small Business Administration (“SBA”).
Nonaccrual and Past Due Loans:

The Company does not record interest on nonaccrual loans until principal is recovered. For all loan classes, a loan is generally placed on nonaccrual status when principal or interest becomes 90 days past due unless it is well secured and in the process of collection, or earlier when concern exists as to the ultimate collectability of principal or interest. Interest accrued but not received is reversed against earnings. Cash interest received on these loans is applied to the principal balance until the principal is recovered or until the loan returns to accrual status. Loans may be returned to accrual status when all the principal and interest amounts contractually due are brought current, remain current for a prescribed period, and future payments are reasonably assured.
The following table presents the aging of the amortized cost basis in past due loans as of June 30, 2021 by class of loans and loans past due 90 days or more and still accruing by class of loan:
(dollars in thousands)Loans Not Past Due30-89 Days Past DueGreater than 89 Days Past Due and AccruingTotal AccruingTotal NonaccrualNonaccrual With No Allowance For Credit LossTotal
Commercial and industrial loans:            
Working capital lines of credit loans$616,499 $0 $0 $615,885 $614 $173 $616,499 
Non-working capital loans879,755 0 0 874,952 4,803 351 879,755 
Commercial real estate and multi-family residential loans:
Construction and land development loans401,208 0 0 401,208 0 0 401,208 
Owner occupied loans672,470 0 0 668,141 4,329 2,650 672,470 
Nonowner occupied loans605,511 0 0 605,511 0 0 605,511 
Multifamily loans300,089 0 0 300,089 0 0 300,089 
Agri-business and agricultural loans:
Loans secured by farmland167,269 0 0 167,124 145 0 167,269 
Loans for agricultural production179,410 0 0 179,410 0 0 179,410 
Other commercial loans85,261 0 0 85,261 0 0 85,261 
Consumer 1‑4 family mortgage loans:
Closed end first mortgage loans168,793 544 18 168,888 467 71 169,355 
Open end and junior lien loans163,861 18 0 163,781 98 98 163,879 
Residential construction loans12,454 0 0 12,454 0 0 12,454 
Other consumer loans100,440 109 0 100,296 253 0 100,549 
Total$4,353,020 $671 $18 $4,343,000 $10,709 $3,343 $4,353,709 

As of June 30, 2021 there were no loans 30-89 days past due or greater than 89 days past due on nonaccrual. Additionally, interest income recognized on nonaccrual loans was insignificant during the six month period ended June 30, 2021.

When management determines that foreclosure is probable, expected credit losses for collateral dependent loans are based on the fair value of the collateral at the reporting date, adjusted for selling costs as appropriate. A loan is considered collateral dependent when the borrower is experiencing financial difficulty and the loan is expected to be repaid substantially through the operation or sale of the collateral. The class of loan represents the primary collateral type associated with the loan. Significant quarter over quarter changes are reflective of changes in nonaccrual status and not necessarily associated with credit quality indicators like appraisal value.
The following table presents the amortized cost basis of collateral dependent loans by class of loan as of June 30, 2021:
(dollars in thousands)Real EstateGeneral
Business
 Assets		OtherTotal
Commercial and industrial loans:      
Working capital lines of credit loans$0 $441 $0 $441 
Non-working capital loans1,663 9,670 229 11,562 
Commercial real estate and multi-family residential loans:
Owner occupied loans1,959 1,678 1,161 4,798 
Agri-business and agricultural loans:
Loans secured by farmland0 145 0 145 
Consumer 1-4 family mortgage loans:
Closed end first mortgage loans1,585 0 0 1,585 
Total$5,207 $11,934 $1,390 $18,531 

Troubled Debt Restructurings:

Troubled debt restructured loans are included in the totals for individually analyzed loans. The Company has allocated $5.8 million and $5.5 million of specific reserves to customers whose loan terms have been modified in troubled debt restructurings as of June 30, 2021 and December 31, 2020, respectively. The Company is not committed to lend additional funds to debtors whose loans have been modified in a troubled debt restructuring.
(dollars in thousands)June 30,
2021		December 31,
2020
Accruing troubled debt restructured loans$5,040 $5,237 
Nonaccrual troubled debt restructured loans5,938 6,476 
Total troubled debt restructured loans$10,978 $11,713 
During the three and six months ended June 30, 2021, no loans were modified as troubled debt restructurings.

During the three and six months ended June 30, 2020, certain loans were modified as troubled debt restructurings. The modified terms of these loans include one or a combination of the following: inadequate compensation for the terms of the restructure or renewal; a modification of the repayment terms which delays principal repayment for some period; or renewal terms offered to borrowers in financial distress where no additional credit enhancements were obtained at the time of renewal.
The following table presents loans by class modified as new troubled debt restructurings that occurred during the three months ended June 30, 2020:

Modified Repayment Terms
(dollars in thousands)Number of LoansPre-Modification Outstanding Recorded InvestmentPost-Modification Outstanding Recorded InvestmentNumber of LoansExtension Period or Range (in months)
Troubled Debt Restructurings          
Commercial and industrial loans:
Working capital lines of credit loans1 250 315 1 0
Non-working capital loans1 3,500 3,569 1 0
Commercial real estate and multi-family residential loans:
Owner occupied loans1 1,528 1,527 1 0
Total3 $5,278 $5,411 3 0

For the three month period ended June 30, 2020, the troubled debt restructurings described above increased the allowance for loan losses by $2.3 million, and no charge-offs were recorded.

The following table presents loans by class modified as new troubled debt restructurings that occurred during the six months ended June 30, 2020:
Modified Repayment Terms
(dollars in thousands)Number of LoansPre-Modification Outstanding Recorded InvestmentPost-Modification Outstanding Recorded InvestmentNumber of LoansExtension Period or Range (in months)
Troubled Debt Restructurings
Commercial and industrial loans:
Working capital lines of credit loans1 250 315 1 0
Non-working capital lines of credit loans2 4,288 3,691 2 0
Commercial real estate and multi-family residential loans:
Owner occupied loans1 1,528 1,527 1 0
Total4 $6,066 $5,533 4 0

For the six month period ended June 30, 2020, the troubled debt restructurings described above increased the allowance for credit losses by $2.4 million, and charge-offs of $666,000 were recorded.
As of June 30, 2021, total deferrals attributed to COVID-19 were $36.9 million representing eight borrowers. This represented 0.8% of the total loan portfolio. All eight were commercial loan borrowers and there were no retail borrowers with COVID-19 deferrals. The majority of all loan deferrals were for a period of 90 days. Of the total commercial deferrals attributed to COVID-19, $14.2 million represented a first deferral action, $253,000 represented a second deferral action, $20.0 million represented a third deferral action and $2.5 million represented a fourth deferral action. One borrower represented 64% of the third and fourth deferral population and was a commercial real estate nonowner occupied loan supported by adequate collateral and personal guarantors and consists of a loan to the hotel and accommodation industry. All COVID-19 related loan deferrals remain on accrual status, as each deferral is evaluated individually, and management has determined that all contractual cashflows are collectable at this time. In accordance with Section 4013 of the CARES Act, loan deferrals granted to customers that resulted from the impact of COVID-19 and who were not past due at December 31, 2019 were not considered troubled debt restructurings as of June 30, 2021. This provision was extended to January 1, 2022 under the Consolidated Appropriations Act, 2021. Management continues to monitor these deferrals and has adequately considered these credits in the June 30, 2021 allowance for credit losses balance.
Allowance for Loan Losses (Prior to January 1, 2021):
Prior to the adoption of ASC 326 on January 1, 2021 the Company calculated the allowance for loan losses using the incurred losses methodology. The following tables are disclosures related to the allowance for loan losses in prior periods.

The following tables present the activity in the allowance for loan losses by portfolio segment for the three-month period ended June 30, 2020:


(dollars in thousands)Commercial and IndustrialCommercial Real Estate and Multfamily ResidentialAgri-business and AgriculturalOther CommercialConsumer 1-4 Family MortgageOther ConsumerUnallocatedTotal
Three Months Ended June 30, 2020
Beginning balance, January 1$24,739 $18,658 $3,704 $521 $2,475 $447 $3,065 $53,609 
Provision for credit losses2,062 2,387 (299)21 953 387 (11)5,500 
Loans charged-off(296)0 0 0 0 (115)0 (411)
Recoveries239 18 3 0 6 55 0 321 
Net loans charged-off(57)18 3 0 6 (60)0 (90)
Ending balance$26,744 $21,063 $3,408 $542 $3,434 $774 $3,054 $59,019 

The following tables present the activity in the allowance for loan losses by portfolio segment for the six-month period ended June 30, 2020:
(dollars in thousands)Commercial and IndustrialCommercial Real Estate and Multfamily ResidentialAgri-business and AgriculturalOther CommercialConsumer 1-4 Family MortgageOther ConsumerUnallocatedTotal
Six Months Ended June 30, 2020
Beginning balance, January 1$25,789 $15,796 $3,869 $447 $2,086 $345 $2,320 $50,652 
Provision for credit losses4,690 5,137 (466)95 1,348 562 734 12,100 
Loans charged-off(4,031)0 0 0 (13)(216)0 (4,260)
Recoveries296 130 5 0 13 83 0 527 
Net loans charged-off(3,735)130 5 0 0 (133)0 (3,733)
Ending balance$26,744 $21,063 $3,408 $542 $3,434 $774 $3,054 $59,019 
The following table presents the balance in the allowance for loan losses and the recorded investment in loans by portfolio segment and based on impairment method as of December 31, 2020:
(dollars in thousands)Commercial and IndustrialCommercial Real Estate and Multfamily ResidentialAgri-business and AgriculturalOther CommercialConsumer 1-4 Family MortgageOther ConsumerUnallocatedTotal
December 31, 2020
Allowance for loan losses:
Ending allowance balance attributable to loans:
Individually evaluated for impairment$6,310 $1,377 $84 $0 $270 $0 $0 $8,041 
Collectively evaluated for impairment22,023 21,530 2,959 416 2,349 951 3,139 53,367 
Total ending allowance balance$28,333 $22,907 $3,043 $416 $2,619 $951 $3,139 $61,408 
Loans:
Loans individually evaluated for impairment$12,533 $5,518 $428 $0 $1,700 $0 $0 $20,179 
Loans collectively evaluated for impairment1,772,393 1,887,054 429,234 93,912 342,999 103,385 0 4,628,977 
Total ending loans balance$1,784,926 $1,892,572 $429,662 $93,912 $344,699 $103,385 $0 $4,649,156 
The following table presents loans individually evaluated for impairment by class of loans as of December 31, 2020:

(dollars in thousands)Unpaid Principal BalanceRecorded InvestmentAllowance for Loan Losses Allocated
With no related allowance recorded:      
Commercial and industrial loans:      
Working capital lines of credit loans$346 $173 $0 
Non-working capital loans2,399 968 0 
Commercial real estate and multi-family residential loans:
Owner occupied loans3,002 2,930 0 
Agri-business and agricultural loans:
Loans secured by farmland603 283 0 
Consumer 1‑4 family loans:
Closed end first mortgage loans316 236 0 
Open end and junior lien loans5 5 0 
With an allowance recorded:
Commercial and industrial loans:
Working capital lines of credit loans433 433 255 
Non-working capital loans11,644 10,959 6,055 
Commercial real estate and multi-family residential loans:
Owner occupied loans2,589 2,588 1,377 
Agri-business and agricultural loans:
Loans secured by farmland145 145 84 
Consumer 1‑4 family mortgage loans:
Closed end first mortgage loans1,457 1,459 270 
Total$22,939 $20,179 $8,041 
The following table presents loans individually evaluated for impairment by class of loans as of and for the three-month period ended June 30, 2020:

(dollars in thousands)Average Recorded InvestmentInterest Income RecognizedCash Basis Interest Income Recognized
With no related allowance recorded:      
Commercial and industrial loans:      
Working capital lines of credit loans$774 $0 $0 
Non-working capital loans744 10 10 
Commercial real estate and multi-family residential loans:
Owner occupied loans2,104 4 4 
Agri-business and agricultural loans:
Loans secured by farmland283 0 0 
Consumer 1‑4 family loans:
Closed end first mortgage loans313 1 0 
Open end and junior lien loans49 0 0 
With an allowance recorded:
Commercial and industrial loans:
Working capital lines of credit loans2,171 0 0 
Non-working capital loans11,600 63 63 
Commercial real estate and multi-family residential loans:
Owner occupied loans3,108 0 0 
Agri-business and agricultural loans:
Loans secured by farmland147 0 0 
Consumer 1‑4 family mortgage loans:
Closed end first mortgage loans1,606 0 0 
Open end and junior lien loans639 0 0 
Residential construction loans52 0 0 
Total$23,590 $78 $77 
The following table presents loans individually evaluated for impairment by class of loans as of and for the six-month period ended June 30, 2020:

(dollars in thousands)Average Recorded InvestmentInterest Income RecognizedCash Basis Interest Income Recognized
With no related allowance recorded:      
Commercial and industrial loans:      
Working capital lines of credit loans$577 $0 $0 
Non-working capital loans652 11 11 
Commercial real estate and multi-family residential loans:
Owner occupied loans2,124 9 8 
Agri-business and agricultural loans:
Loans secured by farmland283 0 0 
Consumer 1‑4 family loans:
Closed end first mortgage loans319 2 1 
Open end and junior lien loans67 0 0 
With an allowance recorded:
Commercial and industrial loans:
Working capital lines of credit loans3,729 0 0 
Non-working capital loans11,659 153 153 
Commercial real estate and multi-family residential loans:
Owner occupied loans2,554 30 30 
Agri-business and agricultural loans:
Loans secured by farmland147 0 0 
Consumer 1‑4 family mortgage loans:
Closed end first mortgage loans1,623 21 20 
Open end and junior lien loans638 0 0 
Residential construction loans52 0 0 
Total$24,424 $226 $223 
The following table presents the aging of the recorded investment in past due loans as of December 31, 2020 by class of loans:

(dollars in thousands)Loans Not
Past Due		30‑89
 Days Past Due		Greater than
 90 Days Past Due		Greater than 90 Days Past DueNonaccrualTotal Past Due and NonaccrualTotal
Commercial and industrial loans:            
Working capital lines of credit loans$625,493 $0 $0 $0 $606 $606 $626,099 
Non-working capital loans1,153,540 0 0 0 5,287 5,287 1,158,827 
Commercial real estate and multi-family residential loans:
Construction and land development loans361,664 0 0 0 0 0 361,664 
Owner occupied loans642,527 0 0 0 5,047 5,047 647,574 
Nonowner occupied loans579,050 0 0 0 0 0 579,050 
Multifamily loans304,284 0 0 0 0 0 304,284 
Agri-business and agricultural loans:
Loans secured by farmland194,935 0 0 0 428 428 195,363 
Loans for agricultural production234,191 108 0 0 0 108 234,299 
Other commercial loans93,912 0 0 0 0 0 93,912 
Consumer 1‑4 family mortgage loans:
Closed end first mortgage loans165,895 877 116 116 613 1,606 167,501 
Open end and junior lien loans165,094 137 0 0 5 142 165,236 
Residential construction loans11,962 0 0 0 0 0 11,962 
Other consumer loans103,240 145 0 0 0 145 103,385 
Total$4,635,787 $1,267 $116 $116 $11,986 $13,369 $4,649,156 
As of December 31, 2020, and based on the most recent analysis performed, the risk category of loans by class of loans is as follows:
(dollars in thousands)PassSpecial
Mention		SubstandardDoubtfulNot
Rated		Total
Commercial and industrial loans:            
Working capital lines of credit loans$535,071 $81,095 $9,718 $0 $215 $626,099 
Non-working capital loans1,111,989 26,523 14,820 0 5,495 1,158,827 
Commercial real estate and multi-family residential loans:
Construction and land development loans361,664 0 0 0 0 361,664 
Owner occupied loans608,845 31,355 7,374 0 0 647,574 
Nonowner occupied loans547,790 31,260 0 0 0 579,050 
Multi-family loans282,031 22,253 0 0 0 304,284 
Agri-business and agricultural loans:
Loans secured by farmland183,983 10,728 652 0 0 195,363 
Loans for agricultural production185,875 48,424 0 0 0 234,299 
Other commercial loans93,912 0 0 0 0 93,912 
Consumer 1‑4 family mortgage loans:
Closed end first mortgage loans40,682 0 1,695 0 125,124 167,501 
Open end and junior lien loans8,424 0 5 0 156,807 165,236 
Residential construction loans0 0 0 0 11,962 11,962 
Other consumer loans36,979 253 0 0 66,153 103,385 
Total$3,997,245 $251,891 $34,264 $0 $365,756 $4,649,156