Loans (Tables)

12 Months Ended

Dec. 31, 2019

Receivables [Abstract]

Summary of Loans

The following is a summary of loans:

(Dollars in thousands)	December 31, 2019				December 31, 2018
	Amount		%		Amount		%
Commercial:
Commercial real estate (1)		$1,547,572	40	%		$1,392,408	38	%
Commercial & industrial (2)	585,289		15		620,704		17
Total commercial	2,132,861		55		2,013,112		55
Residential Real Estate:
Residential real estate (3)	1,449,090		37		1,360,387		37
Consumer:
Home equity	290,874		7		280,626		8
Other (4)	20,174		1		26,235		—
Total consumer	311,048		8		306,861		8
Total loans (5)		$3,892,999	100	%		$3,680,360	100	%

(1) Commercial real estate (“CRE”) consists of commercial mortgages primarily secured by income-producing property, as well as construction and development loans. Construction and development loans are made to businesses for land development or the on-site construction of industrial, commercial, or residential buildings.

(2) Commercial and industrial (“C&I”) consists of loans to businesses and individuals, a substantial portion of which are fully or partially collateralized by real estate.

(3) Residential real estate consists of mortgage and homeowner construction loans secured by one- to four-family residential properties.

(4) Other consists of loans to individuals secured by general aviation aircraft and other personal installment loans.

(5) Includes net unamortized loan origination costs of $5.3 million and $4.7 million, respectively, at December 31, 2019 and 2018 and net unamortized premiums on purchased loans of $995 thousand and $703 thousand, respectively, at December 31, 2019 and 2018.

Past Due Loans

The following tables present an aging analysis of past due loans, segregated by class of loans:

(Dollars in thousands)	Days Past Due
December 31, 2019	30-59		60-89		Over 90		Total Past Due		Current		Total Loans
Commercial:
Commercial real estate		$830		$—		$603		$1,433		$1,546,139		$1,547,572
Commercial & industrial	1		—		—		1		585,288		585,289
Total commercial	831		—		603		1,434		2,131,427		2,132,861
Residential Real Estate:
Residential real estate	4,574		2,155		4,700		11,429		1,437,661		1,449,090
Consumer:
Home equity	971		729		996		2,696		288,178		290,874
Other	42		—		88		130		20,044		20,174
Total consumer	1,013		729		1,084		2,826		308,222		311,048
Total loans		$6,418		$2,884		$6,387		$15,689		$3,877,310		$3,892,999

(Dollars in thousands)	Days Past Due
December 31, 2018	30-59		60-89		Over 90		Total Past Due		Current		Total Loans
Commercial:
Commercial real estate		$155		$925		$—		$1,080		$1,391,328		$1,392,408
Commercial & industrial	—		—		—		—		620,704		620,704
Total commercial	155		925		—		1,080		2,012,032		2,013,112
Residential Real Estate:
Residential real estate	6,318		2,693		1,509		10,520		1,349,867		1,360,387
Consumer:
Home equity	1,281		156		552		1,989		278,637		280,626
Other	33		—		—		33		26,202		26,235
Total consumer	1,314		156		552		2,022		304,839		306,861
Total loans		$7,787		$3,774		$2,061		$13,622		$3,666,738		$3,680,360

Impaired Loans

The following is a summary of impaired loans:

(Dollars in thousands)	Recorded Investment (1)				Unpaid Principal				Related Allowance
December 31,	2019		2018		2019		2018		2019		2018
No Related Allowance Recorded
Commercial:
Commercial real estate		$—		$925		$—		$926		$—		$—
Commercial & industrial	—		4,681		—		4,732		—		—
Total commercial	—		5,606		—		5,658		—		—
Residential Real Estate:
Residential real estate	13,968		9,347		14,803		9,695		—		—
Consumer:
Home equity	1,471		1,360		1,472		1,360		—		—
Other	88		—		88		—		—		—
Total consumer	1,559		1,360		1,560		1,360		—		—
Subtotal	15,527		16,313		16,363		16,713		—		—
With Related Allowance Recorded
Commercial:
Commercial real estate	603		—		926		—		—		—
Commercial & industrial	657		52		657		73		580		—
Total commercial	1,260		52		1,583		73		580		—
Residential Real Estate:
Residential real estate	687		364		714		390		95		100
Consumer:
Home equity	292		85		291		85		291		24
Other	18		22		18		22		2		3
Total consumer	310		107		309		107		293		27
Subtotal	2,257		523		2,606		570		968		127
Total impaired loans		$17,784		$16,836		$18,969		$17,283		$968		$127
Total:
Commercial		$1,260		$5,658		$1,583		$5,731		$580		$—
Residential real estate	14,655		9,711		15,517		10,085		95		100
Consumer	1,869		1,467		1,869		1,467		293		27
Total impaired loans		$17,784		$16,836		$18,969		$17,283		$968		$127

(1) The recorded investment in impaired loans consists of unpaid principal balance, net of charge-offs, interest payments received applied to principal and unamortized deferred loan origination fees and costs. For accruing impaired loans (troubled debt restructurings for which management has concluded that the collectibility of the loan is not in doubt), the recorded investment also includes accrued interest.

The following table presents the average recorded investment balance of impaired loans and interest income recognized on impaired loans segregated by loan class:

(Dollars in thousands)	Average Recorded Investment						Interest Income Recognized
Years ended December 31,	2019		2018		2017		2019		2018		2017
Commercial:
Commercial real estate		$864		$1,050		$8,425		$1		$—		$79
Commercial & industrial	2,149		5,403		6,445		106		259		281
Total commercial	3,013		6,453		14,870		107		259		360
Residential real estate:
Residential real estate	11,575		9,645		14,571		473		393		444
Consumer:
Home equity	1,466		1,182		685		58		52		31
Other	68		69		143		2		5		10
Total consumer	1,534		1,251		828		60		57		41
Totals		$16,122		$17,349		$30,269		$640		$709		$845

Nonaccrual Loans

The following is a summary of nonaccrual loans, segregated by class of loans:

(Dollars in thousands)
December 31,	2019		2018
Commercial:
Commercial real estate		$603		$925
Commercial & industrial	657		—
Total commercial	1,260		925
Residential Real Estate:
Residential real estate	14,297		9,346
Consumer:
Home equity	1,763		1,436
Other	88		—
Total consumer	1,851		1,436
Total nonaccrual loans		$17,408		$11,707
Accruing loans 90 days or more past due		$—		$—

Credit Quality Indicators - Commercial

The following table presents the commercial loan portfolio, segregated by category of credit quality indicator:

(Dollars in thousands)	Pass				Special Mention				Classified
December 31,	2019		2018		2019		2018		2019		2018
Commercial:
Commercial real estate		$1,546,139		$1,387,666		$830		$205		$603		$4,537
Commercial & industrial	549,416		559,019		24,961		50,426		10,912		11,259
Total commercial		$2,095,555		$1,946,685		$25,791		$50,631		$11,515		$15,796

Credit Quality Indicators - Residential & Consumer

The following table presents the residential and consumer loan portfolios, segregated by category of credit quality indicator:

(Dollars in thousands)	Current				Past Due
December 31,	2019		2018		2019		2018
Residential Real Estate:
Residential real estate		$1,437,661		$1,349,867		$11,429		$10,520
Consumer:
Home equity		$288,178		$278,637		$2,696		$1,989
Other	20,044		26,202		130		33
Total consumer		$308,222		$304,839		$2,826		$2,022

Analysis of Loan Servicing Rights

The following table presents an analysis of loan servicing rights:

(Dollars in thousands)	Loan Servicing Rights			Valuation Allowance		Total
Balance at December 31, 2016		$3,493			$—		$3,493
Loan servicing rights capitalized	1,104			—		1,104
Amortization	(984		)	—		(984		)
Balance at December 31, 2017	3,613			—		3,613
Loan servicing rights capitalized	905			—		905
Amortization	(867		)	—		(867		)
Balance at December 31, 2018	3,651			—		3,651
Loan servicing rights capitalized	902			—		902
Amortization	(1,027		)	—		(1,027		)
Balance at December 31, 2019		$3,526			$—		$3,526

Amortization Expense Related to Loan Servicing Assets

The following table presents estimated aggregate amortization expense related to loan servicing assets:

(Dollars in thousands)
Years ending December 31:	2020		$825
	2021	632
	2022	484
	2023	371
	2024	284
	2025 and thereafter	930
Total estimated amortization expense			$3,526

Loans Serviced for Others, by Type of Loan

The following table presents the balance of loans serviced for others by type of loan:

(Dollars in thousands)
December 31,	2019		2018
Residential mortgages		$586,996		$588,534
Commercial loans	159,948		142,218
Total		$746,944		$730,752