Loans and Allowance for Loan Losses (Tables)

9 Months Ended

Sep. 30, 2012

Loans and Allowance for Loan Losses [Abstract]

Composition of the loan portfolio by type

The composition of the loan portfolio is summarized as follows:

	September 30, 2012		December 31, 2011
Commercial, financial and agricultural	$	133,365,046	$	142,209,279
Commercial mortgages		311,126,130		264,589,013
Residential mortgages		193,049,212		193,599,853
Indirect consumer loans		130,969,296		97,165,447
Consumer loans		107,848,451		99,351,585
	$	876,358,135	$	796,915,177

Allowance for loan losses by portfolio segment

In addition, the following tables present activity in the allowance for loan losses for the three and nine ending September 30, 2011, by portfolio segment for Legacy loans.  The allowance for loan losses on Acquired loans was established during the quarter ending March 31, 2012, therefore, there was no activity for the three and nine months ending September 30, 2011.

Legacy Loans	Nine Months Ended September 30, 2012
Allowance for loan losses	Commercial, Financial and Agricultural			Commercial Mortgages			Residential Mortgages			Consumer Loans			Unallocated		Total
Beginning balance:	$	3,143,373		$	2,570,149		$	1,309,649		$	2,192,729		$	443,420	$	9,659,320
Charge Offs:		(5,792	)		(39,314	)		(82,442	)		(342,867	)		-		(470,415	)
Recoveries:		591,497			43,031			-			176,139			-		810,667
Net recoveries        (charge offs)		585,705			3,717			(82,442	)		(166,728	)		-		340,252
Provision		(1,300,269	)		682,991			232,793			884,943			32,542		533,000
Ending balance	$	2,428,809		$	3,256,857		$	1,460,000		$	2,910,944		$	475,962	$	10,532,572

Acquired Loans	Nine Months Ended September 30, 2012
Allowance for loan losses	Commercial, Financial and Agricultural		Commercial Mortgages			Residential Mortgages		Consumer Loans		Unallocated		Total
Beginning balance:	$	-	$	-		$	-	$	-	$	-	$	-
Reclassification of acquired loan   Discount		73,228		50,331			-		-		-		123,559
Charge Offs:		-		(49,057	)		-		-		-		(49,057	)
Recoveries:		-		-			-		-		-		-
Net recoveries		73,228		1,274			-		-		-		74,502
Provision		134,427		86,470			-		-		-		220,897
Ending balance	$	207,655	$	87,744		$	-	$	-	$	-	$	295,399

Legacy Loans	Three Months Ended September 30, 2012
Allowance for loan losses	Commercial, Financial and Agricultural			Commercial Mortgages			Residential Mortgages			Consumer Loans			Unallocated		Total
Beginning balance:	$	2,796,556		$	2,987,968		$	1,424,816		$	2,474,185		$	413,648	$	10,097,173
Charge Offs:		-			(31,019	)		(9,829	)		(69,439	)		-		(110,287	)
Recoveries:		239,735			12,535			-			68,416			-		320,686
Net recoveries         (charge offs)		239,735			(18,484	)		(9,829	)		(1,023	)		-		210,399
Provision		(607,482	)		287,373			45,013			437,782			62,314		225,000
Ending balance	$	2,428,809			3,256,857			1,460,000			2,910,944			475,962	$	10,532,572

Acquired Loans	Three Months Ended September 30, 2012
Allowance for loan losses	Commercial, Financial and Agricultural		Commercial Mortgages		Residential Mortgages		Consumer Loans		Unallocated		Total
Beginning balance:	$	207,655	$	87,744	$	-	$	-	$	-	$	295,399
Reclassification of acquired loan   Discount		-		-		-		-		-		-
Charge Offs:		-		-		-		-		-		-
Recoveries:		-		-		-		-		-		-
Net charge offs		-		-		-		-		-		-
Provision		-		-		-		-		-
Ending balance	$	207,655	$	87,744	$	-	$	-	$	-	$	295,399

Legacy Loans	Nine Months Ended September 30, 2011
Allowance for loan losses	Commercial, Financial and Agricultural			Commercial Mortgages			Residential Mortgages			Consumer Loans			Unallocated			Total
Beginning balance:	$	2,118,299		$	2,575,058		$	1,301,780		$	2,727,022		$	775,972		$	9,498,131
Charge Offs:		(593,995	)		(3,764	)		(39,312	)		(542,621	)		-			(1,179,692	)
Recoveries:		314,797			33,304			30,324			146,726			-			525,151
Net recoveries         (charge offs)		(279,198	)		29,540			(8,988	)		(395,895	)		-			(654,541	)
Provision		1,444,245			(69,375	)		(61,068	)		(184,348	)		(296,121	)		833,333
Ending balance	$	3,283,346		$	2,535,223		$	1,231,724		$	2,146,779		$	479,851		$	9,676,923

Legacy Loans	Three Months Ended September 30, 2011
Allowance for loan losses	Commercial, Financial and Agricultural			Commercial Mortgages			Residential Mortgages			Consumer Loans			Unallocated			Total
Beginning balance:	$	3,081,433		$	2,612,655		$	1,246,880		$	2,297,459		$	517,245		$	9,755,672
Charge Offs:		(590,992	)		-			(39,312	)		(201,966	)		-			(832,270	)
Recoveries:		109,391			7,201			-			53,596			-			170,188
Net recoveries         (charge offs)		(481,601	)		7,201			(39,312	)		(148,370	)		-			(662,082	)
Provision		683,514			(84,633	)		24,156			(2,310	)		(37,394	)		583,333
Ending balance	$	3,283,346		$	2,535,223		$	1,231,724		$	2,146,779		$	479,851		$	9,676,923

Allowance for loan losses and the recorded investment in loans based on impairment method.

The following tables present the balance in the allowance for loan losses and the recorded investment in loans by portfolio segment based on impairment method as of September 30, 2012 and December 31, 2011.  The recorded investment excludes Acquired loans except for those loans acquired with deteriorated credit quality:

	September 30, 2012
Allowance for loan losses	Commercial, Financial and Agricultural		Commercial Mortgages		Residential Mortgages		Consumer Loans		Unallocated		Total
Ending allowance balance attributable to loans:
Individually evaluated for impairment	$	946,255	$	97,291	$	-	$	-	$	-	$	1,043,546
Collectively evaluated for impairment		1,482,554		3,159,566		1,460,000		2,910,944		475,962		9,489,026
Acquired with deteriorated credit quality		207,655		87,744		-		-		-		295,399
Total ending allowance balance	$	2,636,464	$	3,344,601	$	1,460,000	$	2,910,944	$	475,962	$	10,827,971

	December 31, 2011
Allowance for loan losses	Commercial, Financial and Agricultural		Commercial Mortgages		Residential Mortgages		Consumer Loans		Unallocated		Total
Ending allowance balance attributable to loans:
Individually evaluated for impairment	$	1,528,651	$	413,555	$	-	$	-	$	-	$	1,942,206
Collectively evaluated for impairment		1,614,722		2,156,594		1,309,649		2,192,729		443,420		7,717,114
Total ending allowance balance	$	3,143,373	$	2,570,149	$	1,309,649	$	2,192,729	$	443,420	$	9,659,320

	September 30, 2012
Loans:	Commercial, Financial and Agricultural		Commercial Mortgages		Residential Mortgages		Consumer Loans		Total
Loans individually evaluated for impairment	$	2,445,154		1,777,782		136,844		-		4,359,780
Loans collectively evaluated for impairment		112,741,589		234,567,883		179,469,401		233,911,200		760,690,073
Acquired with deteriorated credit quality		1,152,448		11,400,980		239,911		-		12,793,339
Total ending loans balance	$	116,339,191		247,746,645		179,846,156		233,911,200		777,843,192

	December 31, 2011
Loans:	Commercial, Financial and Agricultural		Commercial Mortgages		Residential Mortgages		Consumer Loans		Total
Loans individually evaluated for impairment	$	5,275,043	$	4,603,563	$	179,337	$	-	$	10,057,943
Loans collectively evaluated for impairment		111,532,413		169,658,759		175,405,950		190,904,630		647,501,752
Total ending loans balance	$	116,807,456	$	174,262,322	$	175,585,287	$	190,904,630	$	657,559,695

Summary of impaired financing receivables

The following tables present loans individually evaluated for impairment recognized by class of loans as of September 30, 2012 and December 31, 2011, the average recorded investment and interest income recognized by class of loans as of the three and nine-month periods ending September 30, 2012 and 2011:

	September 30, 2012						December 31, 2011
	Unpaid Principal Balance		Recorded Investment		Allowance for Loan Losses Allocated		Unpaid Principal Balance			Recorded Investment		Allowance for Loan Losses Allocated
With no related allowance recorded:
Commercial, financial and agricultural:
Commercial & industrial	$	372,788		174,129		-	$	3,512,860	$	2,914,776	$	-
Commercial mortgages:
Construction		10,454		10,454		-		10,454		10,454		-
Other		1,854,966		1,246,775		-		1,091,026		860,648		-
Residential mortgages		136,844		136,844		-		178,925		179,337		-
With an allowance recorded:
Commercial, financial and agricultural:
Commercial & industrial		2,670,391		2,271,025		946,255		2,360,252		2,360,267		1,528,651
Commercial mortgages:
Construction		-		-		-		8,295		8,295		8,295
Other		520,327		520,553		97,291		4,098,627		3,724,166		405,260
Total	$	5,565,770		4,359,780		1,043,546	$	11,260,439	$	10,057,943	$	1,942,206

		Nine-Months Ended September 30, 2012			Nine-Months Ended September 30, 2011				Three Months Ended September 30, 2012				Three Months Ended September 30, 2011
		Average Recorded Investment		Interest Income Recognized		Average Recorded Investment		Interest Income Recognized	Average Recorded Investment		Interest Income Recognized		Average Recorded Investment		Interest Income Recognized
With no related allowance recorded:
Commercial, financial and agricultural:
Commercial & industrial	$	843,910	$	-	$	3,100,655	$	25,049	$	177,457	$	-	$	3,032,483	$	6,290
Commercial mortgages:
Construction		10,454		-		24,490		-		10,454		-		20,602		-
Other		932,358		-		3,447,948		-		1,081,307		-		3,397,079		-
Residential mortgages		117,737		-		307,997		-		74,441		-		257,799		-
Consumer loans:
Home equity lines & loans		14,892		2,289		-		-		-		-		-		-
With an allowance recorded:
Commercial, financial and agricultural:
Commercial & industrial		2,328,728		-		1,953,474		82,548		2,295,003		-		2,918,444		82,548
Commercial mortgages:
Construction		4,148		-		27,351		-		-		-		15,557		-
Other		1,712,578		-		821,994		17,070		830,049		-		823,995		17,070
Residential mortgages		32,001		-		-		-		64,003		-		-		-
Total	$	5,996,806	$	2,289	$	9,683,909	$	124,667	$	4,532,714	$	-	$	10,465,959	$	105,908

Recorded investment in non accrual and loans past due

The following table presents the recorded investment in non accrual and loans past due over 90 days still on accrual by class of loans as of the periods ending September 30, 2012 and December 31, 2011.  This table includes Acquired loans except for those loans with evidence of credit deterioration at the time of the FOFC merger:

	September 30, 2012				December 31, 2011
	Non-Accrual		Loans Past Due Over 90 Days Still Accruing		Non-Accrual		Loans Past Due Over 90 Days Still Accruing
Commercial, financial and agricultural:
Commercial & industrial	$	2,806,183	$	17,281	$	5,611,805	$	-
Commercial mortgages:
Construction		434,338		4,565,392		18,749		7,295,104
Other		2,054,326		-		4,778,384		-
Residential mortgages		2,363,170		-		2,611,096		-
Consumer loans
Credit cards		-		11,921		-		9,053
Home equity lines & loans		473,981		-		455,418		-
Indirect consumer loans		501,745		-		113,349		-
Other direct consumer loans		31,316		-		22,287		-
Total	$	8,665,059	$	4,594,594	$	13,611,088	$	7,304,157

Recorded investment in loans past due

The following tables present the aging of the recorded investment in loans past due (including non-accrual loans) by class of loans as of September 30, 2012 and December 31, 2011 and by Legacy loans and Acquired loans:

	September 30, 2012
Legacy Loans:	30-59 Days Past Due		60-89 Days Past Due		Greater than 90 Days Past Due		Total Past Due			Loans Acquired with deteriorated credit quality	Loans Not Past Due			Total
Commercial, financial and agricultural:
Commercial & industrial	$	7,353	$	-	$	189,912	$	197,265	$	-	$	114,455,637	$	114,652,902
Agricultural		-		-		-		-		-		533,841		533,841
Commercial mortgages:
Construction		-		-		10,454		10,454		-		30,653,785		30,664,239
Other		59,389		73,584		305,495		438,468		-		205,242,958		205,681,426
Residential mortgages		1,571,579		428,641		622,623		2,622,843		-		176,983,403		179,606,246
Consumer loans:
Credit cards		10,399		3,629		11,921		25,949		-		1,753,893		1,779,842
Home equity lines & loans		196,670		272,940		198,814		668,424		-		79,586,618		80,255,042
Indirect consumer loans		656,927		127,026		414,905		1,198,858		-		130,130,094		131,328,952
Other direct consumer loans		19,295		14,865		23,221		57,381		-		20,489,982		20,547,363
Total	$	2,521,612	$	920,685	$	1,777,345	$	5,219,642	$	-	$	759,830,211	$	765,049,853

	September 30, 2012
Acquired Loans:	30-59 Days Past Due		60-89 Days Past Due		Greater than 90 Days Past Due		Total Past Due			Loans Acquired with deteriorated credit quality	Loans Not Past Due			Total
Commercial, financial and agricultural:
Commercial & industrial	$	95,799	$	4,994	$	361,159	$	461,952	$	1,152,448	$	18,760,978	$	20,375,378
Commercial mortgages:
Construction		-		-		4,989,277		4,989,277		1,179,177		1,728,428		7,896,882
Other		547,737		-		286,997		834,734		10,221,803		54,897,378		65,953,915
Residential mortgages		614,844		-		201,442		816,286		239,911		12,923,490		13,979,687
Consumer loans:
Home equity lines & loans		-		-		-		-		-		5,470,998		5,470,998
Other direct consumer loans		-		-		-		-		-		92,309		92,309
Total	$	1,258,380	$	4,994	$	5,838,875	$	7,102,249	$	12,793,339	$	93,873,581	$	113,769,169

	December 31, 2011
Legacy Loans:		30-59 Days Past Due		60-89 Days Past Due		Greater than 90 Days Past Due		Total Past Due			Loans Acquired with deteriorated credit quality	Loans Not Past Due			Total
Commercial, financial and agricultural:
Commercial & industrial		$	4,571	$	10,940	$	2,920,906	$	2,936,417	$	-	$	113,612,941	$	116,549,358
Agricultural			-		-		-		-		-		258,098		258,098
Commercial mortgages:
Construction			-		-		-		-		-		7,383,731		7,383,731
Other			82,986		-		2,977,010		3,059,996		-		163,818,595		166,878,591
Residential mortgages			1,418,234		293,337		1,221,056		2,932,627		-		172,652,660		175,585,287
Consumer loans:
Credit cards			3,660		8,031		9,053		20,744		-		1,934,471		1,955,215
Home equity lines & loans			368,556		27,717		212,573		608,846		-		76,280,502		76,889,348
Indirect consumer loans			597,180		75,817		85,763		758,760		-		96,781,480		97,540,240
Other direct consumer loans			21,876		10,243		9,644		41,763		-		14,478,064		14,519,827
Total		$	2,497,063	$	426,085	$	7,436,005	$	10,359,153	$	-	$	647,200,542	$	657,559,695

	December 31, 2011
Acquired Loans:		30-59 Days Past Due		60-89 Days Past Due		Greater than 90 Days Past Due		Total Past Due			Loans Acquired with deteriorated credit quality	Loans Not Past Due			Total
Commercial, financial and agricultural:
Commercial & industrial		$	275,121	$	82,677	$	195,687	$	553,485	$	1,499,141	$	25,335,874	$	27,388,500
Commercial mortgages:
Construction			-		418,518		7,295,104		7,713,622		2,022,149		2,715,270		12,451,041
Other			-		-		193,570		193,570		11,063,483		65,836,938		77,093,991
Residential mortgages			405,087		62,017		84,083		551,187		226,937		17,753,898		18,532,022
Consumer loans:
Home equity lines & loans			-		-		-		-		-		6,168,831		6,168,831
Other direct consumer loans			171		-		-		171		-		147,439		147,610
Total		$	680,379	$	563,212	$	7,768,444	$	9,012,035	$	14,811,710	$	117,958,250	$	141,781,995

Risk category of the recorded investment of loans by class of loans

Loans not meeting the criteria above that are analyzed individually as part of the above described process are considered to be not rated loans.  Based on the analysis's performed as of September 30, 2012 and December 31, 2011, the risk category of the recorded investment of loans by class of loans is as follows:

	September 30, 2012
Legacy Loans:	Not Rated		Pass		Special Mention		Substandard		Doubtful
Commercial, financial and agricultural:
Commercial & industrial	$	-	$	102,309,471	$	7,723,549	$	2,348,857	$	2,271,025
Agricultural		-		533,841		-		-		-
Commercial mortgages:
Construction		-		29,708,671		198,373		757,195		-
Other		-		189,704,790		10,730,594		4,887,276		358,766
Residential mortgages		177,499,107		-		-		2,107,139		-
Consumer loans:
Credit cards		1,779,842		-		-		-		-
Home equity lines & loans		79,780,903		-		-		474,139		-
Indirect consumer loans		130,827,207		-		-		501,745		-
Other direct consumer loans		20,516,047		-		-		31,316		-
Total	$	410,403,106	$	322,256,773	$	18,652,516	$	11,107,667	$	2,629,791

	September 30, 2012
Acquired Loans:		Not Rated		Pass		Loans Acquired with deteriorated credit quality		Special Mention		Substandard		Doubtful
Commercial, financial and agricultural:
Commercial & industrial		$	-		18,341,646	$	1,152,448	$	520,125	$	278,788	$	82,371
Commercial mortgages:
Construction			-		251,220		1,179,177		5,044,630		1,421,855		-
Other			-		52,881,017		10,221,803		1,329,016		1,328,509		193,570
Residential mortgages			13,483,746		-		239,911		-		256,030		-
Consumer loans
Home equity lines & loans			5,470,998		-		-		-		-		-
Other direct consumer loans			92,309		-		-		-		-		-
Total		$	19,047,053		71,473,883	$	12,793,339	$	6,893,771	$	3,285,182	$	275,941

	December 31, 2011
Legacy Loans:	Not Rated		Pass		Special Mention		Substandard		Doubtful
Commercial, financial and agricultural:
Commercial & industrial	$	-	$	93,923,356	$	14,957,683	$	4,139,413	$	3,528,906
Agricultural		-		258,098		-		-		-
Commercial mortgages:
Construction		-		6,391,614		208,360		783,757		-
Other		-		152,435,884		6,503,087		7,423,514		516,106
Residential mortgages		173,120,292		-		-		2,464,995		-
Consumer loans:
Credit cards		1,955,215		-		-		-		-
Home equity lines & loans		76,432,196		-		-		457,152		-
Indirect consumer loans		97,426,891		-		-		113,349		-
Other direct consumer loans		14,497,795		-		-		22,032		-
Total	$	363,432,389	$	253,008,952	$	21,669,130	$	15,404,212	$	4,045,012

	December 31, 2011
Acquired Loans:	Not Rated		Pass		Loans Acquired with deteriorated credit quality		Special Mention		Substandard		Doubtful
Commercial, financial and agricultural:
Commercial & industrial	$	-	$	25,164,742	$	1,499,141	$	602,006	$	24,635	$	97,976
Commercial mortgages:
Construction		-		1,790,731		2,022,149		7,447,661		1,190,500		-
Other		-		62,684,708		11,063,483		475,036		2,677,194		193,570
Residential mortgages		18,158,984		-		226,937		-		146,101		-
Consumer loans
Home equity lines & loans		6,168,831		-		-		-		-		-
Other direct consumer loans		147,610		-		-		-		-		-
Total	$	24,475,425	$	89,640,181	$	14,811,710	$	8,524,703	$	4,038,430	$	291,546

Recorded investment in residential and consumer loans based on payment activity

The Corporation considers the performance of the loan portfolio and its impact on the allowance for loan losses. For residential and consumer loan classes, the Corporation also evaluates credit quality based on the aging status of the loan, which was previously presented, and by payment activity.  The following table presents the recorded investment in residential and consumer loans based on payment activity as of September 30, 2012 and December 31, 2011:

	September 30, 2012
			Consumer Loans
Legacy Loans:	Residential Mortgages		Credit Card		Home Equity Lines & Loans		Indirect Consumer Loans		Other Direct Consumer Loans
Performing	$	177,499,107	$	1,767,921	$	79,781,061	$	130,827,207	$	20,516,047
Non-Performing		2,107,139		11,921		473,981		501,745		31,316
		179,606,246		1,779,842		80,255,042		131,328,952		20,547,363

Acquired Loans:
Performing	$	13,723,657	$	-	$	5,470,998	$	-	$	92,309
Non-Performing		256,030		-				-		-
Total	$	13,979,687	$	-	$	5,470,998	$	-	$	92,309

	December 31, 2011
			Consumer Loans
Legacy Loans:	Residential Mortgages		Credit Card		Home Equity Lines & Loans		Indirect Consumer Loans		Other Direct Consumer Loans
Performing	$	173,120,292	$	1,946,162	$	76,432,196	$	97,426,891	$	14,497,878
Non-Performing		2,464,995		9,053		457,152		113,349		21,949
Total	$	175,585,287	$	1,955,215	$	76,889,348	$	97,540,240	$	14,519,827

Acquired Loans:
Performing	$	18,385,921	$	-	$	6,168,831	$	-	$	147,610
Non-Performing		146,101		-		-		-		-
Total	$	18,532,022	$	-	$	6,168,831	$	-	$	147,610

Summary of changes in contractually required principal and interest on loans acquired

Acquired loans include loans acquired with deteriorated credit quality.  The Corporation adjusted its estimates of future expected losses, cash flows, and renewal assumptions during the current year.  These adjustments were made for changes in expected cash flows due to loans refinanced beyond original maturity dates, impairments recognized subsequent to the acquisition advances made for taxes or insurance to protect collateral held and payments received in excess of amounts originally expected.  The tables below summarize the changes in total contractually required principal and interest cash payments, management's estimate of expected total cash payments and carrying value of the loans from January 1, 2012 to September 30, 2012 and from July 1, 2012 to September 30, 2012:

Nine Months Ended September 30, 2012	Balance at December 31, 2011			Income Accretion		All Other Adjustments			Balance at September 30, 2012
Contractually required principal and interest	$	21,260,381		$	-	$	(1,811,021	)	$	19,449,360
Contractual cash flows not expected to be collected   (nonaccretable discount)		(4,662,346	)		-		776,839			(3,885,507	)
Cash flows expected to be collected		16,598,035			-		(1,034,182	)		15,563,853
Interest component of expected cash flows (accretable yield)		(1,843,603	)		1,481,515		(2,391,636	)		(2,753,724	)
Fair value of loans acquired with deteriorating credit quality	$	14,754,432		$	1,481,515	$	(3,425,818	)	$	12,810,129

Three Months Ended September 30, 2012	Balance at June 30, 2012			Income Accretion		All Other Adjustments			Balance at September 30, 2012
Contractually required principal and interest	$	19,834,397		$	-	$	(385,037	)	$	19,449,360
Contractual cash flows not expected to be collected   (nonaccretable discount)		(3,978,427	)		-		92,920			(3,885,507	)
Cash flows expected to be collected		15,855,970			-		(292,117	)		15,563,853
Interest component of expected cash flows (accretable yield)		(2,971,148	)		310,344		(92,920	)		(2,753,724	)
Fair value of loans acquired with deteriorating credit quality	$	12,884,822		$	310,344	$	(385,037	)	$	12,810,129