ALLOWANCE FOR CREDIT LOSSES AND CREDIT QUALITY (Tables)

3 Months Ended

Mar. 31, 2021

ALLOWANCE FOR CREDIT LOSSES AND CREDIT QUALITY

In Allowance For Loan Losses and Recorded Investment In Loans By Portfolio Segment

The following tables present the activity in the allowance for credit losses by portfolio segment for the three-month period ended March 31, 2021:

			Commercial
			Real Estate
	Commercial		and		Agri-business				Consumer
	and		Multifamily		and		Other		1-4 Family		Other
(dollars in thousands)	Industrial		Residential		Agricultural		Commercial		Mortgage		Consumer		Unallocated		Total
Three Months Ended March 31, 2021
Beginning balance, January 1	$	28,333	$	22,907	$	3,043	$	416	$	2,619	$	951	$	3,139	$	61,408
Impact of adopting ASC 326		4,312		4,316		1,060		941		953		349		(2,881)		9,050
Provision for credit losses		(540)		2,285		(202)		(185)		(233)		13		339		1,477
Loans charged-off		(87)		(71)		0		0		(6)		(72)		0		(236)
Recoveries		34		8		0		0		51		52		0		145
Net loans charged-off		(53)		(63)		0		0		45		(20)		0		(91)
Ending balance	$	32,052	$	29,445	$	3,901	$	1,172	$	3,384	$	1,293	$	597	$	71,844

The following tables present the activity in the allowance for loan losses by portfolio segment for the three-month period ended March 31, 2020:

			Commercial
			Real Estate
	Commercial		and		Agri-business				Consumer
	and		Multifamily		and		Other		1-4 Family		Other
(dollars in thousands)	Industrial		Residential		Agricultural		Commercial		Mortgage		Consumer		Unallocated		Total
Three Months Ended March 31, 2020
Beginning balance, January 1	$	25,789	$	15,796	$	3,869	$	447	$	2,086	$	345	$	2,320	$	50,652
Provision for credit losses		2,628		2,750		(167)		74		395		175		745		6,600
Loans charged-off		(3,735)		0		0		0		(13)		(101)		0		(3,849)
Recoveries		57		112		2		0		7		28		0		206
Net loans charged-off		(3,678)		112		2		0		(6)		(73)		0		(3,643)
Ending balance	$	24,739	$	18,658	$	3,704	$	521	$	2,475	$	447	$	3,065	$	53,609

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:

			Commercial
			Real Estate
	Commercial		and		Agri-business				Consumer
	and		Multi-family		and		Other		1-4 Family		Other
(dollars in thousands)	Industrial		Residential		Agricultural		Commercial		Mortgage		Consumer		Unallocated		Total
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 impairment		22,023		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 impairment		1,772,393		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

Summary of risk category of loans by loan segment and origination date and Credit Quality Indicators

The following table summarizes the risk category of loans by loan segment and origination date as of March 31, 2021:

(dollars in thousands)	2021		2020		2019		2018		2017		Prior		Term Total		Revolving		Total
Commercial and industrial loans:
Working capital lines of credit loans:
Pass	$	1,699	$	7,903	$	15,719	$	2,351	$	1,168	$	642	$	29,482	$	469,298	$	498,780
Special Mention		0		0		0		0		0		0		0		59,011		59,011
Substandard		0		0		35		0		173		35		243		16,662		16,905
Doubtful		0		0		0		0		0		0		0		0		0
Not Rated		0		0		0		0		0		0		0		0		0
Total	$	1,699	$	7,903	$	15,754	$	2,351	$	1,341	$	677	$	29,725	$	544,971	$	574,696
Non-working capital loans:
Pass	$	163,261	$	448,279	$	115,200	$	100,782	$	37,144	$	28,151	$	892,817	$	150,459	$	1,043,276
Special Mention		4,424		5,394		1,468		3,302		3,609		1,635		19,832		2,896		22,728
Substandard		0		6,754		1,340		4,684		4,642		1,076		18,496		3,142		21,638
Doubtful		0		0		0		0		0		0		0		0		0
Not Rated		856		2,360		1,104		1,083		357		69		5,829		0		5,829
Total	$	168,541	$	462,787	$	119,112	$	109,851	$	45,752	$	30,931	$	936,974	$	156,497	$	1,093,471
Commercial real estate and multi-family residential loans:
Construction and land development loans:
Pass	$	4,739	$	36,704	$	12,586	$	57,515	$	1,639	$	17,070	$	130,253	$	239,380	$	369,633
Special Mention		0		0		0		0		0		0		0		0		0
Substandard		0		0		0		0		0		0		0		0		0
Doubtful		0		0		0		0		0		0		0		0		0
Not Rated		0		0		0		0		0		0		0		0		0
Total	$	4,739	$	36,704	$	12,586	$	57,515	$	1,639	$	17,070	$	130,253	$	239,380	$	369,633
Owner occupied loans:
Pass	$	44,701	$	181,024	$	72,230	$	85,797	$	86,522	$	116,435	$	586,709	$	44,030	$	630,739
Special Mention		1,675		0		2,183		1,401		23,062		2,242		30,563		0		30,563
Substandard		0		2,039		1,092		2,111		1,458		932		7,632		0		7,632
Doubtful		0		0		0		0		0		0		0		0		0
Not Rated		0		0		0		0		0		0		0		0		0
Total	$	46,376	$	183,063	$	75,505	$	89,309	$	111,042	$	119,609	$	624,904	$	44,030	$	668,934
Nonowner occupied loans:
Pass	$	26,222	$	168,765	$	158,407	$	45,092	$	43,415	$	95,478	$	537,379	$	36,478	$	573,857
Special Mention		0		0		666		3,406		0		27,107		31,179		0		31,179
Substandard		0		0		0		0		0		0		0		0		0
Doubtful		0		0		0		0		0		0		0		0		0
Not Rated		0		0		0		0		0		0		0		0		0
Total	$	26,222	$	168,765	$	159,073	$	48,498	$	43,415	$	122,585	$	568,558	$	36,478	$	605,036
Multifamily loans:
Pass	$	13,224	$	109,440	$	79,629	$	14,830	$	17,242	$	30,423	$	264,788	$	13,956	$	278,744
Special Mention		0		0		0		0		22,252		0		22,252		0		22,252
Substandard		0		0		0		0		0		0		0		0		0
Doubtful		0		0		0		0		0		0		0		0		0
Not Rated		0		0		0		0		0		0		0		0		0
Total	$	13,224	$	109,440	$	79,629	$	14,830	$	39,494	$	30,423	$	287,040	$	13,956	$	300,996
Agri-business and agricultural loans:
Loans secured by farmland:
Pass	$	16,709	$	31,945	$	21,644	$	15,817	$	11,433	$	25,434	$	122,982	$	21,195	$	144,177
Special Mention		0		2,089		2,374		746		200		1,924		7,333		2,628		9,961
Substandard		0		220		0		0		0		428		648		0		648
Doubtful		0		0		0		0		0		0		0		0		0
Not Rated		0		0		0		0		0		0		0		0		0
Total	$	16,709	$	34,254	$	24,018	$	16,563	$	11,633	$	27,786	$	130,963	$	23,823	$	154,786
Loans for agricultural production:
Pass	$	1,594	$	33,549	$	5,474	$	12,302	$	1,851	$	8,448	$	63,218	$	82,152	$	145,370
Special Mention		495		10,154		5,582		18,788		62		19		35,100		11,942		47,042
Substandard		0		0		0		0		0		0		0		0		0
Doubtful		0		0		0		0		0		0		0		0		0
Not Rated		0		0		0		0		0		0		0		0		0
Total	$	2,089	$	43,703	$	11,056	$	31,090	$	1,913	$	8,467	$	98,318	$	94,094	$	192,412
Other commercial loans:
Pass	$	919	$	30,687	$	5,766	$	2,524	$	10,249	$	14,206	$	64,351	$	22,028	$	86,379
Special Mention		0		0		0		0		0		0		0		0		0
Substandard		0		0		0		0		0		0		0		0		0
Doubtful		0		0		0		0		0		0		0		0		0
Not Rated		0		0		0		0		0		0		0		0		0
Total	$	919	$	30,687	$	5,766	$	2,524	$	10,249	$	14,206	$	64,351	$	22,028	$	86,379
Consumer 1-4 family mortgage loans:
Closed end first mortgage loans
Pass	$	3,252	$	18,893	$	7,016	$	7,339	$	4,048	$	6,407	$	46,955	$	2,717	$	49,672
Special Mention		0		0		0		0		0		0		0		0		0
Substandard		0		0		0		0		14		1,481		1,495		0		1,495
Doubtful		0		0		0		0		0		0		0		0		0
Not Rated		4,474		31,927		14,397		12,868		13,123		32,653		109,442		631		110,073
Total	$	7,726	$	50,820	$	21,413	$	20,207	$	17,185	$	40,541	$	157,892	$	3,348	$	161,240
Open end and junior lien loans
Pass	$	101	$	494	$	166	$	404	$	0	$	32	$	1,197	$	10,305	$	11,502
Special Mention		0		0		0		0		0		0		0		0		0
Substandard		0		0		0		0		0		0		0		0		0
Doubtful		0		0		0		0		0		0		0		0		0
Not Rated		1,565		9,308		9,290		7,900		4,119		2,603		34,785		112,747		147,532
Total	$	1,666	$	9,802	$	9,456	$	8,304	$	4,119	$	2,635	$	35,982	$	123,052	$	159,034
Residential construction loans
Pass	$	0	$	0	$	0	$	0	$	0	$	0	$	0	$	0	$	0
Special Mention		0		0		0		0		0		0		0		0		0
Substandard		0		0		0		0		0		0		0		0		0
Doubtful		0		0		0		0		0		0		0		0		0
Not Rated		2,139		4,268		1,098		262		202		1,210		9,179		0		9,179
Total	$	2,139	$	4,268	$	1,098	$	262	$	202	$	1,210	$	9,179	$	0	$	9,179
Other consumer loans
Pass	$	253	$	6,503	$	1,687	$	0	$	1,395	$	0	$	9,838	$	24,887	$	34,725
Special Mention		0		0		253		0		0		0		253		0		253
Substandard		0		0		0		0		0		0		0		0		0
Doubtful		0		0		0		0		0		0		0		0		0
Not Rated		5,423		21,653		11,465		10,166		4,065		2,004		54,776		9,081		63,857
Total	$	5,676	$	28,156	$	13,405	$	10,166	$	5,460	$	2,004	$	64,867	$	33,968	$	98,835
TOTAL		297,725		1,170,352		547,871		411,470		293,444		418,144		3,139,006		1,335,625		4,474,631

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:

			Special						Not
(dollars in thousands)	Pass		Mention		Substandard		Doubtful		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 loans		1,111,989		26,523		14,820		0		5,495		1,158,827
Commercial real estate and multi-family residential loans:
Construction and land development loans		361,664		0		0		0		0		361,664
Owner occupied loans		608,845		31,355		7,374		0		0		647,574
Nonowner occupied loans		547,790		31,260		0		0		0		579,050
Multi-family loans		282,031		22,253		0		0		0		304,284
Agri-business and agricultural loans:
Loans secured by farmland		183,983		10,728		652		0		0		195,363
Loans for agricultural production		185,875		48,424		0		0		0		234,299
Other commercial loans		93,912		0		0		0		0		93,912
Consumer 1‑4 family mortgage loans:
Closed end first mortgage loans		40,682		0		1,695		0		125,124		167,501
Open end and junior lien loans		8,424		0		5		0		156,807		165,236
Residential construction loans		0		0		0		0		11,962		11,962
Other consumer loans		36,979		253		0		0		66,153		103,385
Total	$	3,997,245	$	251,891	$	34,264	$	0	$	365,756	$	4,649,156

Schedule of Amortized Cost Basis In Past due loans

The following table presents the aging of the amortized cost basis in past due loans as of March 31, 2021 by class of loans and loans past due 90 days or more and still accruing by class of loan:

					Greater than						Nonaccrual
			30-89		89 Days						With No
	Loans Not		Days		Past Due		Total		Total		Allowance
(dollars in thousands)	Past Due		Past Due		and Accruing		Accruing		Nonaccrual		For Credit Loss		Total
Commercial and industrial loans:
Working capital lines of credit loans	$	574,696	$	0	$	0	$	574,096	$	600	$	173	$	574,696
Non-working capital loans		1,093,471		0		0		1,088,338		5,133		610		1,093,471
Commercial real estate and multi-family residential loans:
Construction and land development loans		369,633		0		0		369,633		0		0		369,633
Owner occupied loans		668,934		0		0		663,855		5,079		3,396		668,934
Nonowner occupied loans		605,036		0		0		605,036		0		0		605,036
Multifamily loans		300,996		0		0		300,996		0		0		300,996
Agri-business and agricultural loans:
Loans secured by farmland		154,786		0		0		154,358		428		283		154,786
Loans for agricultural production		192,412		0		0		192,412		0		0		192,412
Other commercial loans		86,379		0		0		86,379		0		0		86,379
Consumer 1‑4 family mortgage loans:
Closed end first mortgage loans		160,677		545		18		160,773		467		72		161,240
Open end and junior lien loans		158,924		110		0		159,034		0		0		159,034
Residential construction loans		9,179		0		0		9,179		0		0		9,179
Other consumer loans		98,753		82		0		98,835		0		0		98,835
Total	$	4,473,876	$	737	$	18	$	4,462,924	$	11,707	$	4,534	$	4,474,631

Schedule of Amortized Cost Basis Of Collateral Dependent Loans

The following table presents the amortized cost basis of collateral dependent loans by class of loan as of March 31, 2021:

			General
(dollars in thousands)	Real Estate		Business Assets		Other		Total
Commercial and industrial loans:
Working capital lines of credit loans	$	0	$	427	$	0	$	427
Non-working capital loans		1,952		9,507		229		11,688
Commercial real estate and multi-family residential loans:
Owner occupied loans		2,707		1,682		1,161		5,550
Agri-business and agricultural loans:
Loans secured by farmland		283		145		0		428
Consumer 1-4 family mortgage loans:
Closed end first mortgage loans		1,496		0		0		1,496
Total	$	6,438	$	11,761	$	1,390	$	19,589

Loans individually evaluated for impairment

The following table presents loans individually evaluated for impairment by class of loans as of December 31, 2020:

	Unpaid				Allowance for
	Principal		Recorded		Loan Losses
(dollars in thousands)	Balance		Investment		Allocated
With no related allowance recorded:
Commercial and industrial loans:
Working capital lines of credit loans	$	346	$	173	$	0
Non-working capital loans		2,399		968		0
Commercial real estate and multi-family residential loans:
Owner occupied loans		3,002		2,930		0
Agri-business and agricultural loans:
Loans secured by farmland		603		283		0
Consumer 1‑4 family loans:
Closed end first mortgage loans		316		236		0
Open end and junior lien loans		5		5		0
With an allowance recorded:
Commercial and industrial loans:
Working capital lines of credit loans		433		433		255
Non-working capital loans		11,644		10,959		6,055
Commercial real estate and multi-family residential loans:
Owner occupied loans		2,589		2,588		1,377
Agri-business and agricultural loans:
Loans secured by farmland		145		145		84
Consumer 1‑4 family mortgage loans:
Closed end first mortgage loans		1,457		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 March 31, 2020:

	Average		Interest		Cash Basis
	Recorded		Income		Interest Income
(dollars in thousands)	Investment		Recognized		Recognized
With no related allowance recorded:
Commercial and industrial loans:
Working capital lines of credit loans	$	380	$	0	$	0
Non-working capital loans		558		1		1
Commercial real estate and multi-family residential loans:
Owner occupied loans		2,144		5		4
Agri-business and agricultural loans:
Loans secured by farmland		283		0		0
Consumer 1‑4 family loans:
Closed end first mortgage loans		325		1		1
Open end and junior lien loans		85		0		0
With an allowance recorded:
Commercial and industrial loans:
Working capital lines of credit loans		5,287		0		0
Non-working capital loans		11,719		90		90
Commercial real estate and multi-family residential loans:
Owner occupied loans		1,999		30		30
Agri-business and agricultural loans:
Loans secured by farmland		147		0		0
Consumer 1‑4 family mortgage loans:
Closed end first mortgage loans		1,641		21		20
Open end and junior lien loans		638		0		0
Residential construction loans		52		0		0
Total	$	25,258	$	148	$	146

Troubled Debt Restructuring

	March 31		December 31
(dollars in thousands)	2021		2020
Accruing troubled debt restructured loans	$	5,111	$	5,237
Nonaccrual troubled debt restructured loans		6,508		6,476
Total troubled debt restructured loans	$	11,619	$	11,713

Loans by Class Modified as Troubled Debt Restructurings

The following table presents loans by class modified as new troubled debt restructurings that occurred during the three months ended March 31, 2020:

						Modified Repayment Terms
		Pre-Modification		Post-Modification			Extension
		Outstanding		Outstanding			Period or
	Number of	Recorded		Recorded		Number of	Range
(dollars in thousands)	Loans	Investment		Investment		Loans	(in months)
Troubled Debt Restructurings
Commercial and industrial loans:
Non-working capital loans	1		788		122	1	0
Total	1	$	788	$	122	1	0

Aging of the Recorded Investment in Past Due Loans

The following table presents the aging of the recorded investment in past due loans as of December 31, 2020 by class of loans:

			30‑89		Greater than		Greater than				Total Past
	Loans Not		Days		90 Days		90 Days				Due and
(dollars in thousands)	Past Due		Past Due		Past Due		Past Due		Nonaccrual		Nonaccrual		Total
Commercial and industrial loans:
Working capital lines of credit loans	$	625,493	$	0	$	0	$	0	$	606	$	606	$	626,099
Non-working capital loans		1,153,540		0		0		0		5,287		5,287		1,158,827
Commercial real estate and multi-family residential loans:
Construction and land development loans		361,664		0		0		0		0		0		361,664
Owner occupied loans		642,527		0		0		0		5,047		5,047		647,574
Nonowner occupied loans		579,050		0		0		0		0		0		579,050
Multifamily loans		304,284		0		0		0		0		0		304,284
Agri-business and agricultural loans:
Loans secured by farmland		194,935		0		0		0		428		428		195,363
Loans for agricultural production		234,191		108		0		0		0		108		234,299
Other commercial loans		93,912		0		0		0		0		0		93,912
Consumer 1‑4 family mortgage loans:
Closed end first mortgage loans		165,895		877		116		116		613		1,606		167,501
Open end and junior lien loans		165,094		137		0		0		5		142		165,236
Residential construction loans		11,962		0		0		0		0		0		11,962
Other consumer loans		103,240		145		0		0		0		145		103,385
Total	$	4,635,787	$	1,267	$	116	$	116	$	11,986	$	13,369	$	4,649,156