LOANS (Tables)

9 Months Ended

Sep. 30, 2015

Accounts, Notes, Loans and Financing Receivable [Line Items]

The balances of these classes are summarized as follows:

(000's omitted)	September 30, 2015			December 31, 2014
Consumer mortgage	$	1,621,862		$	1,613,384
Business lending		1,288,772			1,262,484
Consumer indirect		872,988			833,968
Consumer direct		184,479			184,028
Home equity		345,446			342,342
Gross loans		4,313,547			4,236,206
Allowance for loan losses		(45,588	)		(45,341	)
Loans, net of allowance for loan losses	$	4,267,959		$	4,190,865

Schedule of Accretable Discount Related to Credit Impaired Acquired Loans

The outstanding balance related to credit impaired acquired loans was $5.2 million and $6.1 million at September 30, 2015 and December 31, 2014, respectively. The changes in the accretable discount related to the credit impaired acquired loans are as follows:

(000’s omitted)
Balance at December 31, 2014	$	705
Accretion recognized, year-to-date		(437	)
Net reclassification to accretable from non-accretable		329
Balance at September 30, 2015	$	597

Aged Analysis of the Company's Past Due Loans by Class

The following is an aged analysis of the Company’s past due loans, by class as of September 30, 2015:

Legacy Loans (excludes loans acquired after January 1, 2009)

(000’s omitted)	Past Due 30 – 89 Days		90+ Days Past Due and Still Accruing		Nonaccrual		Total Past Due		Current		Total Loans
Consumer mortgage	$	10,115	$	1,351	$	12,108	$	23,574	$	1,538,515	$	1,562,089
Business lending		2,187		135		6,402		8,724		1,159,228		1,167,952
Consumer indirect		9,785		58		0		9,843		862,571		872,414
Consumer direct		1,148		41		1		1,190		179,428		180,618
Home equity		1,023		291		1,993		3,307		289,015		292,322
Total	$	24,258	$	1,876	$	20,504	$	46,638	$	4,028,757	$	4,075,395

Acquired Loans (includes loans acquired after January 1, 2009)

(000’s omitted)	Past Due 30 – 89 Days		90+ Days Past Due and Still Accruing		Nonaccrual		Total Past Due		Acquired Impaired⁽¹⁾		Current		Total Loans
Consumer mortgage	$	1,271	$	130	$	1,473	$	2,874	$	0	$	56,899	$	59,773
Business lending		192		0		710		902		4,675		115,243		120,820
Consumer indirect		25		0		0		25		0		549		574
Consumer direct		126		0		14		140		0		3,721		3,861
Home equity		446		69		432		947		0		52,177		53,124
Total	$	2,060	$	199	$	2,629	$	4,888	$	4,675	$	228,589	$	238,152

(1)

Acquired impaired loans were not classified as nonperforming assets as the loans are considered to be performing under ASC 310-30. As a result interest income, through the accretion of the difference between the carrying amount of the loans and the expected cashflows, is being recognized on all acquired impaired loans.

The following is an aged analysis of the Company’s past due loans by class as of December 31, 2014:

Legacy Loans (excludes loans acquired after January 1, 2009)

(000’s omitted)	Past Due 30 – 89 Days		90+ Days Past Due and Still Accruing		Nonaccrual		Total Past Due		Current		Total Loans
Consumer mortgage	$	13,978	$	2,165	$	13,201	$	29,344	$	1,515,057	$	1,544,401
Business lending		6,738		350		2,291		9,379		1,115,215		1,124,594
Consumer indirect		10,529		82		10		10,621		822,124		832,745
Consumer direct		1,389		36		2		1,427		177,158		178,585
Home equity		1,802		195		2,172		4,169		278,904		283,073
Total	$	34,436	$	2,828	$	17,676	$	54,940	$	3,908,458	$	3,963,398

Acquired Loans (includes loans acquired after January 1, 2009)

(000’s omitted)	Past Due 30 – 89 Days		90+ Days Past Due and Still Accruing		Nonaccrual		Total Past Due		Acquired Impaired⁽¹⁾		Current		Total Loans
Consumer mortgage	$	1,892	$	232	$	2,122	$	4,246	$	0	$	64,737	$	68,983
Business lending		608		0		489		1,097		5,312		131,481		137,890
Consumer indirect		40		0		0		40		0		1,183		1,223
Consumer direct		174		0		18		192		0		5,251		5,443
Home equity		674		46		426		1,146		0		58,123		59,269
Total	$	3,388	$	278	$	3,055	$	6,721	$	5,312	$	260,775	$	272,808

(1)

Summary of Non-business Impaired Loans

All loan classes are collectively evaluated for impairment except business lending, as described in Note C. A summary of individually evaluated impaired loans as of September 30, 2015 and December 31, 2014 follows:

(000’s omitted)	September 30, 2015		December 31, 2014
Loans with allowance allocation	$	2,800	$	0
Loans without allowance allocation		1,086		0
Carrying balance		3,886		0
Contractual balance		3,986		0
Specifically allocated allowance		566		0

Troubled Debt Restructurings on Financing Receivables

Information regarding TDRs as of September 30, 2015 and December 31, 2014 is as follows:

	September 30, 2015												December 31, 2014
(000’s omitted)	Nonaccrual				Accruing				Total				Nonaccrual				Accruing				Total
		#	Amount			#	Amount			#	Amount			#	Amount			#	Amount			#	Amount
Consumer mortgage		41	$	1,500		38	$	1,595		79	$	3,095		49	$	2,092		37	$	1,770		86	$	3,862
Business lending		3		117		4		567		7		684		6		442		3		468		9		910
Consumer indirect		0		0		74		700		74		700		0		0		79		615		79		615
Consumer direct		0		0		16		35		16		35		0		0		25		69		25		69
Home equity		7		101		12		258		19		359		13		218		13		278		26		496
Total		51	$	1,718		144	$	3,155		195	$	4,873		68	$	2,752		157	$	3,200		225	$	5,952

The following table presents information related to loans modified in a TDR during the three and nine months ended September 30, 2015 and 2014. Of the loans noted in the table below, all loans for the three and nine months ended September 30, 2015 and 2014 were modified due to a Chapter 7 bankruptcy as described previously. The financial effects of these restructurings were immaterial.

	Three Months Ended September 30, 2015				Three Months Ended September 30, 2014
(000’s omitted)	Number of loans modified		Outstanding Balance		Number of loans modified		Outstanding Balance
Consumer mortgage		4	$	404		6	$	283
Business lending		0		0		0		0
Consumer indirect		12		112		16		165
Consumer direct		1		0		5		7
Home equity		0		0		0		0
Total		17	$	516		27	$	455

	Nine Months Ended September 30, 2015				Nine Months Ended September 30, 2014
(000’s omitted)	Number of loans modified		Outstanding Balance		Number of loans modified		Outstanding Balance
Consumer mortgage		8	$	585		22	$	1,016
Business lending		0		0		7		556
Consumer indirect		23		263		29		334
Consumer direct		2		1		7		14
Home equity		1		13		5		173
Total		34	$	862		70	$	2,093

Schedule of Allowance for Loan Losses by Class

The allowance for loan losses is general in nature and is available to absorb losses from any loan type despite the analysis below. The following presents by class the activity in the allowance for loan losses:

	Three Months Ended September 30, 2015
(000’s omitted)	Consumer Mortgage			Business Lending			Consumer Indirect			Consumer Direct			Home Equity			Unallocated			Acquired Impaired			Total
Beginning balance	$	10,192		$	15,353		$	11,602		$	2,991		$	2,677		$	2,374		$	93		$	45,282
Charge-offs		(276	)		(234	)		(1,597	)		(427	)		(66	)		0			(59	)		(2,659	)
Recoveries		9			107			740			174			29			0			0			1,059
Provision		421			112			1,367			359			102			(461	)		6			1,906
Ending balance	$	10,346		$	15,338		$	12,112		$	3,097		$	2,742		$	1,913		$	40		$	45,588

	Three Months Ended September 30, 2014

(000’s omitted)	Consumer Mortgage			Business Lending			Consumer Indirect			Consumer Direct			Home Equity			Unallocated			Acquired Impaired			Total
Beginning balance	$	9,375		$	16,553		$	11,354		$	3,298		$	1,860		$	2,012		$	163		$	44,615
Charge-offs		(203	)		(435	)		(1,711	)		(307	)		(74	)		0			(10	)		(2,740	)
Recoveries		14			335			1,025			239			38			0			0			1,651
Provision		268			138			1,231			100			77			(65	)		(2	)		1,747
Ending balance	$	9,454		$	16,591		$	11,899		$	3,330		$	1,901		$	1,947		$	151		$	45,273

	Nine Months Ended September 30, 2015

(000’s omitted)	Consumer Mortgage			Business Lending			Consumer Indirect			Consumer Direct			Home Equity			Unallocated		Acquired Impaired			Total
Beginning balance	$	10,286		$	15,787		$	11,544		$	3,083		$	2,701		$	1,767	$	173		$	45,341
Charge-offs		(917	)		(667	)		(4,421	)		(1,066	)		(188	)		0		(102	)		(7,361	)
Recoveries		75			715			3,077			566			55			0		0			4,488
Provision		902			(497	)		1,912			514			174			146		(31	)		3,120
Ending balance	$	10,346		$	15,338		$	12,112		$	3,097		$	2,742		$	1,913	$	40		$	45,588

	Nine Months Ended September 30, 2014
(000’s omitted)	Consumer Mortgage			Business Lending			Consumer Indirect			Consumer Direct			Home Equity			Unallocated			Acquired Impaired			Total
Beginning balance	$	8,994		$	17,507		$	10,248		$	3,181		$	1,830		$	2,029		$	530		$	44,319
Charge-offs		(734	)		(940	)		(4,573	)		(1,219	)		(450	)		0			(30	)		(7,946	)
Recoveries		67			607			2,826			677			76			0			0			4,253
Provision		1,127			(583	)		3,398			691			445			(82	)		(349	)		4,647
Ending balance	$	9,454		$	16,591		$	11,899		$	3,330		$	1,901		$	1,947		$	151		$	45,273

Business Lending [Member]

Accounts, Notes, Loans and Financing Receivable [Line Items]

Schedule of Loans by Credit Quality Indicator

The following table shows the amount of business lending loans by credit quality category:

	September 30, 2015						December 31, 2014
(000’s omitted)	Legacy		Acquired		Total		Legacy		Acquired		Total
Pass	$	990,125	$	84,944	$	1,075,069	$	949,960	$	93,510	$	1,043,470
Special mention		111,496		15,343		126,839		103,176		18,038		121,214
Classified		65,831		15,858		81,689		71,458		21,030		92,488
Doubtful		500		0		500		0		0		0
Acquired impaired		0		4,675		4,675		0		5,312		5,312
Total	$	1,167,952	$	120,820	$	1,288,772	$	1,124,594	$	137,890	$	1,262,484

All Other Loan [Member]

Accounts, Notes, Loans and Financing Receivable [Line Items]

Schedule of Loans by Credit Quality Indicator

The following table details the balances in all other loan categories at September 30, 2015:

Legacy Loans (excludes loans acquired after January 1, 2009)

(000’s omitted)	Consumer Mortgage		Consumer Indirect		Consumer Direct		Home Equity		Total
Performing	$	1,548,630	$	872,356	$	180,576	$	290,038	$	2,891,600
Nonperforming		13,459		58		42		2,284		15,843
Total	$	1,562,089	$	872,414	$	180,618	$	292,322	$	2,907,443

Acquired Loans (includes loans acquired after January 1, 2009)

(000’s omitted)	Consumer Mortgage		Consumer Indirect		Consumer Direct		Home Equity		Total
Performing	$	58,170	$	574	$	3,847	$	52,623	$	115,214
Nonperforming		1,603		0		14		501		2,118
Total	$	59,773	$	574	$	3,861	$	53,124	$	117,332

The following table details the balances in all other loan categories at December 31, 2014:

Legacy Loans (excludes loans acquired after January 1, 2009)

(000’s omitted)	Consumer Mortgage		Consumer Indirect		Consumer Direct		Home Equity		Total
Performing	$	1,529,035	$	832,653	$	178,547	$	280,706	$	2,820,941
Nonperforming		15,366		92		38		2,367		17,863
Total	$	1,544,401	$	832,745	$	178,585	$	283,073	$	2,838,804

Acquired Loans (includes loans acquired after January 1, 2009)

(000’s omitted)	Consumer Mortgage		Consumer Indirect		Consumer Direct		Home Equity		Total
Performing	$	66,629	$	1,223	$	5,425	$	58,797	$	132,074
Nonperforming		2,354		0		18		472		2,844
Total	$	68,983	$	1,223	$	5,443	$	59,269	$	134,918