10-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-K

x	ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
	SECURITIES EXCHANGE ACT OF 1934
	For the fiscal year ended December 31, 2016
	OR
¨	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
	SECURITIES EXCHANGE ACT OF 1934

For the transition period from ____________ to ____________

Commission file number: 1-13006

Park National Corporation

(Exact name of Registrant as specified in its charter)

Ohio	31-1179518
(State or other jurisdiction of	(I.R.S. Employer
incorporation or organization)	Identification No.)
50 North Third Street, P.O. Box 3500, Newark, Ohio	43058-3500
(Address of principal executive offices)	(Zip Code)

(740) 349-8451

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Name of each exchange on which registered
Common Shares, without par value	NYSE MKT

Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark if the Registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

xYes ¨No

Indicate by check mark if the Registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.

¨Yes xNo

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

xYes ¨No

Indicate by check mark whether the Registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the Registrant was required to submit and post such files).

xYes ¨No

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of Registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. ¨

Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer x	Accelerated filer ¨
Non-accelerated filer ¨	Smaller reporting company ¨
(Do not check if a smaller reporting company)

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Act).

¨Yes xNo

State the aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold, or the average bid and asked price of such common equity, as of the last business day of the Registrant’s most recently completed second fiscal quarter: As of June 30, 2016, the aggregate market value of the Registrant’s common shares (the only common equity of the Registrant) held by non-affiliates of the Registrant was $1,379,303,140 based on the closing sale price as reported on NYSE MKT. For this purpose, executive officers and directors of the Registrant are considered affiliates.

Indicate the number of shares outstanding of each of the Registrant’s classes of common stock, as of the latest practicable date.

Class	Outstanding at February 17, 2017
Common Shares, without par value	15,290,709 common shares

DOCUMENTS INCORPORATED BY REFERENCE

Document	Parts Into Which Incorporated
Portions of the Registrant’s 2016 Annual Report	Parts I and II
Portions of the Registrant’s Definitive Proxy Statement for the Annual Meeting of Shareholders to be held on April 24, 2017	Part III

Exhibit Index on Page E-1

PART I

ITEM 1. BUSINESS.

General

Park National Corporation (“Park”) is a financial holding company subject to regulation under the Bank Holding Company Act of 1956, as amended (the “Bank Holding Company Act”). Park was initially incorporated under Delaware law in 1986 and began operations as a bank holding company in 1987.  In 1992, Park changed its state of incorporation to Ohio. Park’s principal executive offices are located at 50 North Third Street, Newark, Ohio 43055, and its telephone number is (740) 349-8451. Park’s common shares, each without par value (the “Common Shares”), are listed on NYSE MKT, under the symbol “PRK.”

Park maintains an Internet site which can be accessed at http://www.parknationalcorp.com. Information contained in Park’s Internet site does not constitute part of, and is not incorporated into, this Annual Report on Form 10-K. Park makes available free of charge on or through its Internet site Park’s annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), as well as Park’s definitive proxy statements filed pursuant to Section 14 of the Exchange Act, as soon as reasonably practicable after Park electronically files such material with, or furnishes it to, the Securities and Exchange Commission (the “SEC”).

Park’s principal business consists of owning and supervising its subsidiaries. Although Park directs the overall policies of its subsidiaries, including lending policies and financial resources, most day-to-day affairs are managed by the respective officers of Park’s subsidiaries.

Banking Operations

Throughout the fiscal year ended December 31, 2016 (“Fiscal 2016”), Park’s banking operations were conducted through The Park National Bank ("Park National Bank").

Park National Bank is a national banking association with its main office in Newark, Ohio and financial service offices in Ashland, Athens, Butler, Champaign, Clark, Clermont, Coshocton, Crawford, Darke, Fairfield, Franklin, Greene, Hamilton, Hocking, Holmes, Knox, Licking, Madison, Marion, Mercer, Miami, Morrow, Muskingum, Perry, Richland, Tuscarawas, Warren and Wayne Counties in Ohio.

Park National Bank engages in the commercial banking and trust business, generally in small and medium population Ohio communities in addition to operations within the metropolitan areas of Columbus and Cincinnati. Park National Bank operates 112 financial service offices, including 111 branches, in Ohio through eleven banking divisions with: (i) the Park National Bank Division headquartered in Newark, Ohio; (ii) the Fairfield National Bank Division headquartered in Lancaster, Ohio; (iii) the Richland Bank Division headquartered in Mansfield, Ohio; (iv) the Century National Bank Division headquartered in Zanesville, Ohio; (v) the First-Knox National Bank Division headquartered in Mount Vernon, Ohio; (vi) the Farmers Bank Division headquartered in Loudonville, Ohio; (vii) the United Bank, N.A. Division headquartered in Bucyrus, Ohio; (viii) the Second National Bank Division headquartered in Greenville, Ohio; (ix) the Security National Bank Division headquartered in Springfield, Ohio; (x) the Unity National Bank Division headquartered in Piqua, Ohio; and (xi) The Park National Bank of Southwest Ohio & Northern Kentucky Division headquartered in Cincinnati, Ohio.

Park National Bank, and two additional operating segments, Guardian Financial Services Company ("Guardian Finance") and SE Property Holdings, LLC ("SEPH"), comprise Park’s reportable operating segments. All other operating segments are combined and disclosed in the "All Other" category. Financial information about Park’s reportable operating segments as of December 31, 2016 is included in Note 27 of the Notes to Consolidated Financial Statements in Park’s 2016 Annual Report. That financial information is incorporated herein by reference.

As of the date of this Annual Report on Form 10-K, Park National Bank delivers financial products and services through its 112 financial service offices, a network of 139 automated teller machines, as well as telephone and internet-based banking through both personal computers and mobile devices. Financial information about Park National Bank is included in the "PNB” category for purposes of the reportable segment information included in Note 27 - Segment Information of the Notes to Consolidated Financial Statements in Park’s 2016 Annual Report.

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Consumer Finance Subsidiary

Guardian Finance, an Ohio consumer finance company based in Hilliard, Ohio, operates as a separate subsidiary of Park. Guardian Finance provides consumer finance services in the central Ohio area. As of the date of this Annual Report on Form 10-K, Guardian Finance had five financial service offices spanning five counties in Ohio: Clark, Fairfield, Franklin, Licking and Montgomery. Financial information about Guardian Finance is included in the “GFSC” category for purposes of the reportable segment information included in Note 27 - Segment Information of the Notes to Consolidated Financial Statements in Park’s 2016 Annual Report.

SE Property Holdings, LLC

SEPH is a limited liability company, organized in 2011 under the laws of the State of Ohio, and a direct subsidiary of Park. The initial purpose of SEPH was to purchase other real estate owned (“OREO”) from Vision Bank, a bank subsidiary of Park until February 16, 2012, and continue to market such properties for sale. By letter dated January 30, 2012, the Board of Governors of the Federal Reserve System (the “Federal Reserve Board”) authorized Park to engage in the business of extending credit through SEPH. As a result, SEPH is permitted to engage in lending activities and was able to succeed to the rights and obligations of Vision Bank in respect of the loans held by Vision Bank when Vision Bank merged into SEPH on February 16, 2012 (the "Vision Bank-SEPH merger"). SEPH has operations in Ohio, with the sole purpose of such operations being to sell OREO in an effective and efficient manner and work out or sell problem loan situations with the respective borrowers.

Financial information about SEPH is included in the “SEPH” category for purposes of the reportable segment information included in Note 27 - Segment Information of the Notes to Consolidated Financial Statements in Park’s 2016 Annual Report.

Scope Leasing, Inc.

Scope Leasing, Inc. (which does business as “Scope Aircraft Finance”), a subsidiary of Park National Bank, specializes in aircraft financing. The customers of Scope Aircraft Finance include small businesses and entrepreneurs intending to use the aircraft for business or pleasure. Scope Aircraft Finance serves customers throughout the United States of America (the “United States”) and Canada.

Title Agency Subsidiary

Park holds 80% of the ownership interest of Park Title Agency, LLC. (“Park Title Agency”). Effective May 9, 2014, Park acquired a 49% ownership interest in Park Title Agency from Park National Bank for $316,129 and a 31% ownership interest in Park Title Agency from the other member (which is not a subsidiary of Park) for $200,000. Such other member holds the remaining 20% of the ownership interest of Park Title Agency. Park Title Agency is a traditional title agency serving the central Ohio area but is now in the process of winding down operations.

Vision Bancshares Trust I

In connection with the merger of Vision Bancshares, Inc. (“Vision”) into Park in March of 2007 (the “Vision Merger”), Park entered into a First Supplemental Indenture, dated as of the effective time of the Vision Merger (the “First Supplemental Indenture”), with Vision and Wilmington Trust Company, a Delaware banking corporation, as Trustee. Under the terms of the First Supplemental Indenture, Park assumed all of the payment and performance obligations of Vision under the Junior Subordinated Indenture, dated as of December 5, 2005 (the “Indenture”), pursuant to which Vision issued $15.5 million of junior subordinated notes to Vision Bancshares Trust I, a Delaware statutory trust (the “Vision Trust”). The junior subordinated notes were issued by Vision in connection with the sale by the Vision Trust of $15.0 million of floating rate preferred securities to institutional investors on December 5, 2005.

Under the terms of the First Supplemental Indenture, Park also succeeded to and was substituted for Vision with the same effect as if Park had originally been named (i) as “Depositor” in the Amended and Restated Trust Agreement of the Vision Trust, dated as of December 5, 2005 (the “Trust Agreement”), among Vision, Wilmington Trust Company, as Property Trustee and as Delaware Trustee, and the Administrative Trustees named therein and (ii) as “Guarantor” in the Guarantee Agreement, dated as of December 5, 2005 (the “Guarantee Agreement”), between Vision and Wilmington Trust Company, as Guarantee Trustee. Through these contractual obligations, Park has fully and unconditionally guaranteed all of the Vision Trust’s obligations with respect to the floating rate preferred securities.

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Both the junior subordinated notes and the floating rate preferred securities mature on December 30, 2035 (which maturity may be shortened), and carry a floating interest rate per annum, reset quarterly, equal to the sum of three-month LIBOR plus 148 basis points. Payment of interest on the junior subordinated notes, and payment of cash distributions on the floating rate preferred securities, may be deferred at any time or from time to time for a period not to exceed twenty consecutive quarters, subject to specified conditions.

Under the terms of the Indenture and the related Guarantee Agreement, Park, as successor to Vision in accordance with the First Supplemental Indenture, is prohibited, subject to limited exceptions, from declaring or paying dividends or distributions on, or redeeming, repurchasing, acquiring or making any liquidation payments with respect to, any shares of Park’s capital stock (i) if an event of default under the Indenture has occurred and continues; (ii) if Park is in default with respect to the payment of any obligations under the Guarantee Agreement; or (iii) during any period in which the payment of interest on the junior subordinated notes by Park (and the payment of cash distributions on the floating rate preferred securities by the Vision Trust) is being deferred. The floating rate preferred securities are considered Tier 1 Capital under regulatory capital standards.

Other Subsidiaries

Park Investments, Inc. ("PII"), which is a subsidiary of Park National Bank, operates as an asset management company. Commencing in 2015, Park began purchasing and holding municipal bonds within PII. As of December 31, 2016, PII held municipal securities of $188.6 million.

River Park Properties, LLC and Sunny Green, LLC are subsidiaries of Park National Bank that hold certain OREO properties. The operations of these subsidiaries are not significant to the consolidated entity.

87A Orange Beach, LLC, Morningside Holding, LLC, Swindall Holdings, LLC, Swindall Partnership Holdings, LLC, Marina Holdings Z, LLC, Marina Holding WE, LLC, and Vision-Park Properties, L.L.C. are subsidiaries of SEPH that hold certain OREO properties. The operations of these subsidiaries are not significant to the consolidated entity.

Services Provided by Park’s Subsidiaries

Park National Bank and its divisions provide the following principal services:

• the acceptance of deposits for demand, savings and time accounts and the servicing of those accounts;

• commercial, industrial, consumer and real estate lending, including installment loans, credit cards (which are largely offered through a third party), home equity lines of credit and commercial leasing;

• trust and wealth management services;

• cash management;

• safe deposit operations;

• electronic funds transfers;

• Internet and mobile banking solutions with bill pay service; and

• a variety of additional banking-related services tailored to the needs of individual customers.

Park believes that the deposit mix of Park National Bank and its divisions is currently such that no material portion has been obtained from a single customer and, consequently, the loss of any one customer of Park National Bank (or its divisions) would not have a materially adverse effect on the business of Park National Bank (or the relevant division).

Guardian Finance provides consumer finance services.

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Lending Activities

Park National Bank deals with consumers as well as with a wide cross-section of businesses and corporations located primarily in the 28 Ohio counties served by the financial service offices of Park National Bank. At December 31, 2016, Park National Bank had no concentration of loans to borrowers engaged in the same or similar industries that exceeded 10% of total loans nor did it have any loans outstanding to persons domiciled outside the United States. As a result of the Vision Bank – SEPH merger, SEPH holds loans originated by Vision Bank previously serviced by the financial service offices of Vision Bank. It is expected that SEPH will originate loans only to further the collection efforts with respect to the loans transferred to SEPH by operation of law as a result of the Vision Bank - SEPH merger. Such origination (or modification) volume is expected to be insignificant to the consolidated Park entity. Park National Bank also holds loans which were purchased from Vision Bank prior to the Vision Bank - SEPH merger.

Park National Bank makes lending decisions in accordance with the written loan policies adopted by Park which are designed to maintain acceptable loan quality. Park National Bank originates and retains for its own portfolio commercial and commercial real estate loans, residential real estate loans, home equity lines of credit, and installment loans. Park National Bank also originates fixed-rate residential real estate loans for sale to the secondary market.

Guardian Finance originates and retains for its own portfolio consumer installment loans and commercial loans. Guardian Finance makes lending decisions in accordance with the written loan policy adopted and approved by the Guardian Finance Board of Directors.

There are certain risks inherent in making loans. These risks include changes in the credit worthiness of borrowers over the time period in which loans may be repaid, interest rate changes over the time period in which loans may be repaid, risks resulting from changes in the national and local economies, risks inherent in dealing with borrowers and, in the case of loans secured by collateral, risks resulting from uncertainties about the future value of the collateral.

Commercial Loans

At December 31, 2016, Park’s subsidiaries (including Scope Aircraft Finance) had approximately $2,154 million in commercial loans (commercial, financial and agricultural loans and commercial real estate loans) and commercial leases outstanding, representing approximately 40.9% of their total aggregate loan portfolio as of that date. Of this amount, approximately $995 million represented commercial, financial and agricultural loans, $1,156 million represented commercial real estate loans, and $3 million represented commercial leases.

Commercial loans are made for a wide variety of general corporate purposes, including financing for industrial and commercial properties, financing for equipment, inventory and accounts receivable, acquisition financing, commercial leasing, and to consumer finance companies. The term of each commercial loan varies by its purpose. Repayment terms are structured such that commercial loans will be repaid within the economic useful life of the underlying asset. Information concerning the loan maturity distribution within the commercial loan portfolio is provided in Table 14 included in the section of Park’s 2016 Annual Report captioned “MANAGEMENT'S DISCUSSION AND ANALYSIS,” and is incorporated herein by reference.

The commercial loan portfolio of Park’s current subsidiaries includes loans to a wide variety of corporations and businesses across many industrial classifications in the 28 Ohio counties where Park National Bank operates. The primary industries represented by these customers include commercial real estate leasing, manufacturing, retail trade, health care and other services.

Commercial loans are evaluated for the adequacy of repayment sources at the time of approval and are regularly reviewed for any possible deterioration in the ability of the borrower to repay the loan. The credit information required generally includes, depending on the amount of money lent, fully completed financial statements, third-party prepared financial statements, two years of federal income tax returns and a current credit report. Loan terms include amortization schedules commensurate with the purpose of each loan, identification of the source of each repayment and the risk involved. In most instances, collateral is required to provide an additional source of repayment in the event of default by a commercial borrower. The structure of the collateral package, including the type and amount of the collateral, varies from loan to loan depending on the financial strength of the borrower, the amount and terms of the loan and the collateral available to be pledged by the borrower. Most often, the collateral is inventory, machinery, accounts receivable and/or real estate. The guarantee of the business owners/principals is generally required on loans made to closely-held business entities.

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Commercial real estate loans (“CRE loans”) include mortgage loans to developers and owners of commercial real estate. The lending policy for CRE loans is designed to address the unique risk attributes of CRE lending. The collateral for these CRE loans is the underlying commercial real estate. Park National Bank generally requires that the CRE loan amount be no more than 85% of the purchase price or the appraised value of the commercial real estate securing the CRE loan, whichever is less. CRE loans made for Park National Bank’s portfolio generally have a variable interest rate. For more information concerning the loan maturity distribution in the CRE loan portfolio, please see Table 14 included in the section of Park’s 2016 Annual Report captioned “MANAGEMENT'S DISCUSSION AND ANALYSIS,” which is incorporated herein by reference.

The regulatory limit for loans made to one borrower by Park National Bank was $91.1 million at December 31, 2016. Participations in a loan by Park National Bank in an amount larger than $30.0 million are generally sold to third-party banks or financial institutions. While Park National Bank has a loan limit of $91.1 million, the total exposure of the largest single borrower within the commercial portfolio was $30.0 million at December 31, 2016.

Park has an independent, internal loan review program which annually evaluates substantially all (generally, about 90%) loan relationships with an outstanding balance greater than $300,000. If the loan has deteriorated, the lending subsidiary takes prompt action designed to increase the likelihood that it will be repaid. Upon detection of the reduced ability of a borrower to service interest and/or principal on a loan, the subsidiary may downgrade the loan and, under certain circumstances, place the loan on nonaccrual status. The subsidiary then works with the borrower to develop a payment schedule which the subsidiary anticipates will permit service of the principal and interest on the loan by the borrower. Loans which deteriorate and show the inability of a borrower to repay principal are charged down to the net realizable value of collateral. A collection specialist/work-out officer is available to assist each subsidiary when a credit deteriorates. Information about Park’s policy for placing loans on nonaccrual status is included under the caption “Loans” in Note 1 - Summary of Significant Accounting Policies of the Notes to Consolidated Financial Statements in Park’s 2016 Annual Report, and is incorporated herein by reference.

Commercial loans are generally viewed as having a higher credit risk than consumer loans because commercial loans usually involve larger loan balances to a single borrower and are more susceptible to a risk of default during an economic downturn. Commercial loans generally have variable interest rates. Park uses several indices for commercial loans that help determine loan interest rates. However, the national prime rate is the most common index Park uses. Credit risk for commercial loans arises from borrowers lacking the ability or willingness to pay principal or interest and, in the case of secured loans, by a shortfall in the collateral value in relation to the outstanding loan balance in the event of a default and subsequent liquidation of collateral. The underwriting of generally all commercial loans, regardless of type, includes cash flow analyses with rates shocked by 400 basis points. In the case of commercial loans secured by accounts receivable, the availability of funds for the repayment of these loans may be substantially dependent on the ability of each borrower to collect amounts due from its customers. Other collateral securing commercial loans may depreciate over time, may be difficult to appraise and may fluctuate in value based on the success of the borrower’s business. Information concerning the loan loss experience and the allocation of the allowance for loan losses related to the commercial, financial and agricultural loan portfolio and the commercial real estate portfolio is provided in Table 28 and Table 29, respectively, included in the section of Park’s 2016 Annual Report captioned “MANAGEMENT'S DISCUSSION AND ANALYSIS,” and is incorporated herein by reference.

Aircraft Financing

Scope Aircraft Finance specializes in aircraft financing. The customers of Scope Aircraft Finance include small businesses and entrepreneurs intending to use the aircraft for business or pleasure. The customers of Scope Aircraft Finance are located throughout the United States. The lending officers of Scope Aircraft Finance are experienced in the aircraft financing industry and rely upon that experience and industry guides in determining whether to grant an aircraft loan or lease. At December 31, 2016, Scope Aircraft Finance had outstanding approximately $255 million in loans primarily secured by aircraft (which are included in the commercial loan portfolio).

Consumer Loans

At December 31, 2016, Park's subsidiaries had outstanding consumer loans (including automobile loans and leases) in an aggregate amount of approximately $1,121 million, constituting approximately 21.3% of their aggregate total loan portfolio. These subsidiaries make installment credit available to customers and prospective customers in their primary market areas. At December 31, 2016, of the $1,121 million in consumer loans,GFSC had outstanding consumer loans of $26.4 million.

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Credit approval for consumer loans requires income sufficient to repay principal and interest due, stability of employment, an established credit record and sufficient collateral for secured loans. It is the policy of Park’s subsidiaries to adhere strictly to all laws and regulations governing consumer lending. A compliance officer is responsible for monitoring each subsidiary’s performance and advising and updating loan personnel in this area. Each subsidiary reviews its consumer loan portfolio monthly and charges off loans which do not meet Park’s standards. Information about Park’s policy for placing loans on nonaccrual status is included under the caption “Loans” in Note 1 - Summary of Significant Accounting Policies of the Notes to Consolidated Financial Statements in Park’s 2016 Annual Report, and is incorporated herein by reference.

Consumer loans typically have shorter terms and lower balances with higher yields as compared to real estate mortgage loans, but generally carry higher risks of default. Consumer loan collections are dependent on borrowers' continuing financial stability, and thus are more likely to be affected by adverse personal circumstances. Furthermore, the application of various federal and state laws, including bankruptcy and insolvency laws, may limit the amount that can be recovered on these loans. Information concerning the loan loss experience and the allocation of the allowance for loan losses related to the consumer loan portfolio is provided in Table 28 and Table 29, respectively, included in the section of Park’s 2016 Annual Report captioned “MANAGEMENT'S DISCUSSION AND ANALYSIS,” and is incorporated herein by reference.

Residential Real Estate and Construction Loans

At December 31, 2016, Park's subdiararies had outstanding approximately $1,997 million in construction real estate loans and residential real estate loans, representing approximately 37.9% of total loans outstanding. Of the $1,997 million, approximately $1,808 million was included within the residential real estate loan segment, which included $407 million of commercial real estate loans, $1,169 million of mortgage loans, $212 million of home equity lines of credit and $20 million of installment loans. Included within the $1,808 million of loans within the residential real estate loan segment was $12 million of loans held by SEPH. The remaining $189 million was included within the construction real estate loan segment, which included $133 million of commercial land and development (“CL&D”) loans and $56 million of 1-4 family residential construction loans. The market area for real estate lending by Park National Bank is concentrated in Ohio.

Credit approval for residential real estate loans requires demonstration of sufficient income to repay the principal and interest and the real estate taxes and insurance, stability of employment, an established credit record and a current independent third-party appraisal providing the market value of the real estate securing the loan. Residential real estate loans are generally analyzed through an automated underwriting platform (system) to determine a risk classification. All loans receiving a risk classification of caution require review by a senior lender and generally require additional documentation if the loan is approved.

Park National Bank generally requires that the residential real estate loan amount be no more than 80% of the purchase price or the appraised value of the real estate securing the loan, whichever is less, unless private mortgage insurance is obtained by the borrower. Loans in this lending category which are made to be held in the bank’s portfolio are both fixed and adjustable rate, fully amortized mortgages. The rates used are generally fully-indexed rates. From time to time, Park may offer a limited-time promotional rate on funds advanced on newly originated home equity lines of credit. Park National Bank also originates fixed-rate real estate loans for sale to the secondary market. Prior to 2010, these loans were generally sold immediately after closing. However, beginning in 2010 and continuing through December 31, 2014, Park’s management made a decision to retain certain 15-year, fixed-rate residential mortgage loans, which previously would have been sold in the secondary market. Subsequent to December 31, 2014, Park has generally sold these loans in the secondary market. At December 31, 2016 and 2015, Park reported $598 million and $637 million, respectively, of these loans on the Consolidated Balance Sheets. Real estate loans are typically secured by first mortgages with evidence of title in favor of the lender in the form of an attorney’s opinion of title or a title insurance policy. Park National Bank has also required proof of hazard insurance with the lender named as the mortgagee and as the loss payee. Independent third-party appraisals are generally obtained for consumer real estate loans.

Home equity lines of credit are generally made as second mortgages by Park National Bank. The maximum amount of a home equity line of credit is generally limited to 85% of the appraised value of the property less the balance of the first mortgage. The home equity lines of credit are written with ten-year terms. A variable interest rate is generally charged on the home equity lines of credit.

Information concerning the loan loss experience and the allocation of the allowance for loan losses related to the residential real estate portfolio is provided in Table 28 and Table 29, respectively, included in the section of Park’s 2016 Annual Report captioned “MANAGEMENT'S DISCUSSION AND ANALYSIS,” and is incorporated herein by reference.

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Construction loans include commercial construction loans as well as residential construction loans. Construction loans may be in the form of a permanent loan or a short-term construction loan, depending on the needs of the individual borrower. Generally, the permanent construction loans have a variable interest rate although a permanent construction loan may be made with a fixed interest rate for a term generally not exceeding five years. Short-term construction loans are made with variable interest rates. Information concerning the loan maturity distribution within the construction financing portfolio is provided in Table 14 included in the section of Park’s 2016 Annual Report captioned “MANAGEMENT'S DISCUSSION AND ANALYSIS,” and is incorporated herein by reference.

Construction financing is generally considered to involve a higher degree of risk of loss than long-term financing on improved, occupied real estate. Risk of loss on a construction loan depends largely upon the accuracy of the initial estimate of the property’s value at completion of construction and the estimated cost (including interest) of construction. If the estimate of construction cost proves to be inaccurate, the subsidiary holding the loan may be required to advance funds beyond the amount originally committed to permit completion of the project. If the estimate of value proves inaccurate, the subsidiary holding the loan may be confronted, at or prior to the maturity of the loan, with a project having a value insufficient to assure full repayment, should the borrower default. In the event a default on a construction loan occurs and foreclosure follows, the subsidiary holding the loan must take control of the project and attempt either to arrange for completion of construction or to dispose of the unfinished project. Additional risk exists with respect to a loan made to a developer who does not have a buyer for the property, as the developer may lack funds to pay the loan if the property is not sold upon completion. Park National Bank attempts to reduce such risks on loans to developers by requiring personal guarantees and reviewing current personal financial statements and tax returns as well as other projects undertaken by the developer. For additional information concerning the loan loss experience, please see “ITEM 1A. RISK FACTORS – Changes in economic and political conditions could adversely affect our earnings through declines in our borrowers’ ability to repay loans, the value of the collateral securing our loans, and demand deposits.” and “– Our allowance for loan losses may prove to be insufficient to absorb the probable, incurred losses in our loan portfolio.” in this Annual Report on Form 10-K. Information concerning the loan loss experience and the allocation of the allowance for loan losses related to the construction financing portfolio is provided in Table 28 and Table 29, respectively, included in the section of Park’s 2016 Annual Report captioned “MANAGEMENT'S DISCUSSION AND ANALYSIS,” and is incorporated herein by reference.

SE Property Holdings, LLC

SEPH is a non-bank subsidiary of Park, holding OREO property, non-performing loans and a small number of performing loans. In addition to approximately $7.9 million in OREO property, SEPH also held approximately $12.4 million in loans as of December 31, 2016, of which $11.7 million were on nonaccrual status.. SEPH has one office in Licking County, Ohio. The SEPH employees are dedicated to working with a third-party work-out specialist to ensure effective and efficient resolution to the non-performing loans and OREO, while working closely with the borrowers of the performing loans to maximize collection efforts. It is expected that the loans and OREO will reduce over time and result in cash in-flow to Park.

Title Agency

Park Title Agency is a traditional title agency serving primarily residential and commercial customers of Park National Bank and other property owners in the 28 Ohio counties served by Park National Bank who are seeking title insurance for purchases, construction and refinancing of real estate. Park Title Agency is in the process of winding down operations.

Competition

The financial services industry is highly competitive. Park’s subsidiaries compete with other local, regional and national service providers, including banks, savings associations, credit unions and other types of financial institutions, finance companies, insurance agencies and title agencies. Other competitors include securities dealers, brokers, mortgage bankers, investment advisors, insurance companies and financial services subsidiaries of commercial and manufacturing companies. Competition within the financial services industry continues to increase as a result of mergers between, and expansion of, providers of financial services within and outside Park’s primary market area.

The primary factors in competing for loans are interest rates charged and overall services provided to borrowers. The primary factors in competing for deposits are interest rates paid on deposits, account liquidity, convenience and hours of office locations, convenience and availability of mobile banking options, and having trained and competent staff to deliver services. However, some competitors of Park’s subsidiaries may have greater resources and, as such, higher lending limits, which may adversely affect the ability of Park’s subsidiaries to compete. In addition, some of the providers of financial services with which Park’s subsidiaries compete enjoy the benefits of fewer regulatory constraints and lower cost structures.

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Employees

At December 31, 2016, Park and its subsidiaries had 1,726 full-time equivalent employees.

Supervision and Regulation of Park and its Subsidiaries

Park, Park National Bank and Park’s other subsidiaries are subject to extensive regulation by federal and state agencies. The regulation of financial holding companies and their subsidiaries is intended primarily for the protection of consumers, depositors, borrowers, the FDIC’s Deposit Insurance Fund and the banking system as a whole and not for the protection of shareholders. Applicable laws and regulations restrict permissible activities and investments and require actions to protect loan, deposit, brokerage, fiduciary and other customers, as well as the FDIC’s Deposit Insurance Fund. They also may restrict Park’s ability to repurchase its Common Shares or to receive dividends from Park National Bank and impose capital adequacy and liquidity requirements.

As a financial holding company, Park is subject to regulation by the Federal Reserve Board under the Bank Holding Company Act and to inspection, examination and supervision by the Federal Reserve Board. Park is also subject to the disclosure and regulatory requirements of the Securities Act of 1933, as amended (the “Securities Act”), and the Exchange Act, as administered by the SEC. Park’s Common Shares are listed on NYSE MKT under the trading symbol “PRK,” which subjects Park to the requirements under the applicable sections of the NYSE MKT Company Guide for listed companies.

Park National Bank, as a national banking association, is subject to regulation, supervision and examination primarily by the Office of the Comptroller of the Currency (the “OCC”) and secondarily by the FDIC.

The Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (the "Dodd-Frank Act") established the Consumer Financial Protection Bureau (the "CFPB"), which regulates consumer financial products and services and certain financial services providers. The CFPB is authorized to prevent unfair, deceptive or abusive acts or practices and ensures consistent enforcement of laws so that consumers have access to fair, transparent and competitive markets for consumer financial products and services. The CFPB has rulemaking and interpretative authority.

Guardian Finance, as an Ohio state-chartered consumer finance company, is subject to regulation, supervision and examination by the Ohio Division of Financial Institutions.

As a subsidiary of Park, SEPH is subject to inspection, examination and supervision by the Federal Reserve Board.

Park Title Agency, as an Ohio state-chartered title agency, is subject to regulation, supervision and examination by the Ohio Department of Insurance.

The following information describes selected federal and state statutory and regulatory provisions and is qualified in its entirety by reference to the full text of the particular statutory or regulatory provisions. These statutes and regulations are continually under review by the United States Congress and state legislatures and federal and state regulatory agencies. A change in statutes, regulations or regulatory policies applicable to Park and its subsidiaries could have a material effect on their respective businesses.

Regulation of Financial Holding Companies

As a financial holding company, Park’s activities are subject to extensive regulation by the Federal Reserve Board. Park is required to file reports with the Federal Reserve Board and such additional information as the Federal Reserve Board may require, and is subject to regular examinations by the Federal Reserve Board.

The Federal Reserve Board also has extensive enforcement authority over financial holding companies, including, among other things, the ability to:

• assess civil money penalties;

• issue cease and desist or removal orders; and

• require that a financial holding company divest subsidiaries (including a subsidiary bank).

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In general, the Federal Reserve Board may initiate enforcement actions for violations of laws and regulations and unsafe or unsound practices.

Under Federal Reserve Board policy, a financial holding company is expected to act as a source of financial strength to each subsidiary bank and to commit resources to support such subsidiary bank. Under this policy, the Federal Reserve Board may require a financial holding company to contribute additional capital to an undercapitalized subsidiary bank and may disapprove of the payment of dividends to shareholders if the Federal Reserve Board believes the payment of such dividends would be an unsafe or unsound practice.

The Bank Holding Company Act requires the prior approval of the Federal Reserve Board in any case where a financial holding company proposes to:

• acquire direct or indirect ownership or control of more than 5% of the voting shares of any bank that is not already majority-owned by it;

• acquire all or substantially all of the assets of another bank or another financial or bank holding company; or

• merge or consolidate with any other financial or bank holding company.

A qualifying bank holding company may elect to become a financial holding company and thereby affiliate with securities firms and insurance companies and engage in other activities that are financial in nature and not otherwise permissible for a bank holding company, if each of its subsidiary banks is well capitalized under the Federal Deposit Insurance Corporation Act of 1991 prompt corrective action provisions, is well managed, and has at least a satisfactory rating under the Community Reinvestment Act. Park became a financial holding company in 2014. No regulatory approval is required for a financial holding company to acquire a company, other than a bank or savings association, engaged in activities that are financial in nature or incidental to activities that are financial in nature, as determined by the Federal Reserve Board.

The Financial Services Modernization Act defines “financial in nature” to include:

• securities underwriting, dealing and market making;

• sponsoring mutual funds and investment companies;

• insurance underwriting and agency;

• merchant banking; and

• activities that the Federal Reserve Board has determined to be closely related to banking.

A national bank also may engage, subject to limitations on investment, in activities that are financial in nature, other than insurance underwriting, insurance company portfolio investment, real estate development and real estate investment, through a financial subsidiary of the bank, if the bank is well capitalized and well managed and has at least a satisfactory Community Reinvestment Act rating. A subsidiary bank of a financial holding company or a national bank with a financial subsidiary must continue to be well capitalized and well managed in order to continue to engage in activities that are financial in nature without regulatory actions or restrictions, which could include divestiture of the financial-in-nature subsidiary or subsidiaries. In addition, a financial holding company or a bank may not acquire a company that is engaged in activities that are financial in nature unless each of the subsidiary banks of the financial holding company or the bank has a Community Reinvestment Act rating of satisfactory or better.

Each subsidiary bank of a financial holding company is subject to certain restrictions on the maintenance of reserves against deposits, extensions of credit to the financial holding company or any of its subsidiaries, investments in the stock or other securities of the financial holding company or its subsidiaries and the taking of such stock or securities as collateral for loans to any borrower. Further, a financial holding company and its subsidiaries are prohibited from engaging in certain tying arrangements in connection with any extension of credit, lease or sale of property or furnishing of any services. Various consumer laws and regulations also affect the operations of these subsidiaries.

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Transactions with Affiliates, Directors, Executive Officers and Shareholders

Sections 23A and 23B of the Federal Reserve Act and Federal Reserve Board Regulation W generally:

• limit the extent to which a bank or its subsidiaries may engage in “covered transactions” with any one affiliate;

• limit the extent to which a bank or its subsidiaries may engage in “covered transactions” with all affiliates; and

• require that all such transactions be on terms substantially the same, or at least as favorable to the bank or subsidiary, as those provided to a non-affiliate.

An affiliate of a bank is any company or entity which controls, is controlled by or is under common control with the bank. The term “covered transaction” includes the making of loans to the affiliate, the purchase of assets from the affiliate, the issuance of a guarantee on behalf of the affiliate, the purchase of securities issued by the affiliate and other similar types of transactions.

A bank’s authority to extend credit to executive officers, directors and greater than 10% shareholders, as well as entities such persons control, is subject to Sections 22(g) and 22(h) of the Federal Reserve Act and Regulation O promulgated thereunder by the Federal Reserve Board. Among other things, these loans must be made on terms (including interest rates charged and collateral required) substantially the same as those offered to unaffiliated individuals or be made as part of a benefit or compensation program and on terms widely available to employees, and must not involve a greater than normal risk of repayment. In addition, the amount of loans a bank may make to these persons is based, in part, on the bank’s capital position, and specified approval procedures must be followed in making loans which exceed specified amounts.

Regulation of Nationally-Chartered Banks

As a national banking association, Park National Bank is subject to regulation under the National Banking Act and is periodically examined by the OCC. OCC regulations govern permissible activities, capital requirements, dividend limitations, investments, loans and other matters. Furthermore, Park National Bank is subject, as a member bank, to certain rules and regulations of the Federal Reserve Board, many of which restrict activities and prescribe documentation to protect consumers. Park National Bank is an insured depository institution and a member of the Deposit Insurance Fund. As a result, it is subject to regulation and deposit insurance assessments by the FDIC. In addition, the establishment of branches by Park National Bank is subject to prior approval of the OCC. The OCC has broad enforcement powers over national banks, including the power to impose fines and other civil and criminal penalties and to appoint a conservator or receiver if any of a number of conditions are met.

The CFPB regulates consumer financial products and services provided by Park National Bank through interpretations designed to protect consumers.

Federal Deposit Insurance

The FDIC is an independent federal agency which insures the deposits, up to prescribed statutory limits, of federally-insured banks and savings associations and safeguards the safety and soundness of the financial institution industry. The general insurance limit is $250,000 per separately insured depositor. This insurance is backed by the full faith and credit of the United States Government.

As insurer, the FDIC is authorized to conduct examinations of and to require reporting by insured institutions, including Park National Bank, to prohibit any insured institution from engaging in any activity the FDIC determines to pose a threat to the deposit insurance fund, and to take enforcement actions against insured institutions. The FDIC may terminate insurance of deposits of any insured institution if the FDIC finds that the insured institution has engaged in unsafe and unsound practices, is in an unsafe or unsound condition or has violated any applicable law, regulation, rule, order or condition imposed by the FDIC or any other regulatory agency.

The FDIC assesses quarterly deposit insurance premiums on each insured institution based on risk characteristics of the insured institution and may also impose special assessments in emergency situations. The premiums fund the Deposit Insurance Fund ("DIF"). Pursuant to the Dodd-Frank Act, the FDIC has established 2.0% as the designated reserve ratio ("DRR"), which is the amount in the DIF as a percentage of all DIF insured deposits. In March 2016, the FDIC adopted final rules designed to meet the statutory minimum DRR of 1.35% by September 30, 2020, the deadline imposed by the Dodd-Frank Act. The Dodd-Frank Act requires the FDIC to offset the effect on insured institutions with assets of less than $10 billion of

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the increase in the statutory minimum DRR to 1.35% from the former statutory minimum of 1.15%. Although the FDIC's new rules reduced assessment rates on all banks, they imposed a surcharge on banks with assets of $10 billion or more to be paid until the DRR reaches 1.35%. The rules also provide assessment credits to banks with assets of less than $1 billion for the portion of their assessments that contribute to the increase of the DRR to 1.35%. The rules further changed the method of determining risk-based assessment rates for established banks with less than $10 billion in assets to better ensure that banks taking on greater risks pay more for deposit insurance than banks that take on less risk.

In addition, all FDIC-insured institutions are required to pay assessments to fund interest payments on bonds issued by the Financing Corporation, which was established by the government to recapitalize a predecessor to the DIF. These assessments will continue until the Financing Corporation bonds mature in 2019.    

Federal Home Loan Bank

The Federal Home Loan Banks (“FHLBs”) provide credit to their members in the form of advances. Park National Bank is a member of the FHLB of Cincinnati. As an FHLB member, Park National Bank must maintain an investment in the capital stock of the FHLB of Cincinnati.

Upon the origination or renewal of a loan or advance, each FHLB is required by law to obtain and maintain a security interest in certain types of collateral. Each FHLB is required to establish standards of community investment or service that its members must maintain for continued access to long-term advances from the FHLB. The standards take into account a member’s performance under the Community Reinvestment Act and the member’s record of lending to first-time home buyers.

Regulatory Capital

The Federal Reserve Board has adopted risk-based capital guidelines for financial holding companies and other bank holding companies as well as state member banks. The OCC and the FDIC have adopted risk-based capital guidelines for national banks and state non-member banks, respectively. The guidelines provide a systematic analytical framework which makes regulatory capital requirements sensitive to differences in risk profiles among banking organizations, takes off-balance sheet exposures expressly into account in evaluating capital adequacy, and minimizes disincentives to holding liquid, low-risk assets. Capital levels as measured by these standards are also used to categorize financial institutions for purposes of certain prompt corrective action regulatory provisions.

Prior to January 1, 2015, the guidelines included a minimum for the ratio of total capital to risk-weighted assets of 8%, with at least half of the ratio composed of common shareholders’ equity, minority interests in certain equity accounts of consolidated subsidiaries and a limited amount of qualifying preferred stock and qualified trust preferred securities, less goodwill and certain other intangible assets (known as “Tier 1” risk-based capital). The guidelines also provided for a minimum ratio of Tier 1 capital to average assets, or “leverage ratio,” of 3% for financial holding companies and bank holding companies that met certain criteria, including having the highest regulatory rating, and 4% for all other financial holding companies and bank holding companies.

The risk-based capital guidelines adopted by the federal banking agencies are based on the “International Convergence of Capital Measurement and Capital Standard” (Basel I), published by the Basel Committee on Banking Supervision (the “Basel Committee”) in 1988. In 2004, the Basel Committee published a new capital adequacy framework (Basel II) for large, internationally active banking organizations, and in December 2010 and January 2011, the Basel Committee issued an update to Basel II (“Basel III”). The Basel Committee frameworks did not become applicable to banks supervised in the United States until adopted into United States law or regulations. Although the United States banking regulators imposed some of the Basel II and Basel III rules on banks with $250 billion or more in assets or $10 billion of on-balance sheet foreign exposure, it was not until July 2013 that the United States banking regulators issued final (or, in the case of the FDIC, interim final) new capital rules applicable to smaller banking organizations which also implement certain of the provisions of the Dodd-Frank Act (the “Basel III Capital Rules”). Community banking organizations, including Park and Park National Bank, began transitioning to the new rules on January 1, 2015. The new minimum capital requirements became effective on January 1, 2015; whereas, a new capital conservation buffer and deductions from common equity capital phase in from January 1, 2016 through January 1, 2019, and most deductions from common equity tier 1 capital phase in from January 1, 2015 through January 1, 2019.

The new rules include (a) a new common equity tier 1 capital ratio of at least 4.5%, (b) a Tier 1 capital ratio of at least 6.0%, rather than the former 4.0%, (c) a minimum total capital ratio that remains at 8.0%, and (d) a minimum leverage ratio of 4.0%.

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Common equity for the common equity tier 1 capital ratio includes common stock (plus related surplus) and retained earnings, plus limited amounts of minority interests in the form of common stock, less the majority of certain regulatory deductions.

Tier 1 capital includes common equity as defined for the common equity tier 1 capital ratio, plus certain non-cumulative preferred stock and related surplus, cumulative preferred stock and related surplus and trust preferred securities that have been grandfathered (but which are not permitted going forward), and limited amounts of minority interests in the form of additional Tier 1 capital instruments, less certain deductions.

Tier 2 capital, which can be included in the total capital ratio, includes certain capital instruments (such as subordinated debt) and limited amounts of the allowance for loan and lease losses, subject to new eligibility criteria, less applicable deductions.

The deductions from common equity tier 1 capital include goodwill and other intangibles, certain deferred tax assets, mortgage-servicing assets above certain levels, gains on sale in connection with a securitization, investments in a banking organization’s own capital instruments and investments in the capital of unconsolidated financial institutions (above certain levels). The deductions phase in from 2015 through 2019.

Under the guidelines, capital is compared to the relative risk related to the balance sheet. To derive the risk included in the balance sheet, one of several risk weights is applied to different balance sheet and off-balance sheet assets, primarily based on the relative credit risk of the counterparty. The capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk weightings and other factors. Some of the risk weightings have been changed effective January 1, 2015.

The new rules also place restrictions on the payment of capital distributions, including dividends, and certain discretionary bonus payments to executive officers if the company does not hold a capital conservation buffer of greater than 2.5 percent composed of common equity tier 1 capital above its minimum risk-based capital requirements, or if its eligible retained income is negative in that quarter and its capital conservation buffer ratio was less than 2.5 percent at the beginning of the quarter. The capital conservation buffer phases in starting on January 1, 2016, at .625%.

The implementation of the portion of Basel III that has been phased in as of the date of this Annual Report on Form 10-K, did not have a material impact on Park’s or Park National Bank’s capital ratios. Further, the implementation of Basel III, once fully phased in, is not expected to have a material impact on Park's or Park National Bank's capital ratios.

The federal banking agencies have established a system of prompt corrective action to resolve certain of the problems of undercapitalized institutions. This system is based on five capital level categories for insured depository institutions: “well capitalized,” “adequately capitalized,” “undercapitalized,” “significantly undercapitalized,” and “critically undercapitalized.”

The federal banking agencies may (or in some cases must) take certain supervisory actions depending upon a bank’s capital level. For example, the banking agencies must appoint a receiver or conservator for a bank within 90 days after the bank becomes “critically undercapitalized” unless the bank’s primary regulator determines, with the concurrence of the FDIC, that other action would better achieve regulatory purposes. Banking operations otherwise may be significantly affected depending on a bank’s capital category. For example, a bank that is not “well capitalized” generally is prohibited from accepting brokered deposits and offering interest rates on deposits higher than the prevailing rate in its market, and the holding company of any undercapitalized depository institution must guarantee, in part, specific aspects of the bank’s capital plan for the plan to be acceptable.

In order to be “well-capitalized,” a bank must have a common equity tier I capital ratio of at least 6.5%, a total risk-based capital of at least 10.0%, a Tier 1 risk-based capital ratio of at least 8.0% and a leverage ratio of at least 5.0%, and the bank must not be subject to any written agreement, order, capital directive or prompt corrective action directive to meet and maintain a specific capital level for any capital measure. Park’s management believes that Park National Bank meets the ratio requirements to be deemed “well-capitalized” according to the guidelines described above. See Note 26 of the Notes to Consolidated Financial Statements of Park’s 2016 Annual Report, which is incorporated herein by reference.

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Fiscal and Monetary Policies

The business and earnings of Park and its subsidiaries are affected significantly by the fiscal policies of the United States government and its agencies. Park National Bank is particularly affected by the monetary policies of the Federal Reserve Board, which regulates the supply of money and credit in the United States. These policies are used in varying degrees and combinations to directly affect the availability of bank loans and deposits, as well as the interest rates charged on loans and paid on deposits.

Limits on Dividends and Other Payments

There are various legal limitations on the extent to which a subsidiary bank may finance or otherwise supply funds to its parent holding company. Under applicable federal and state laws, a subsidiary bank may not, subject to certain limited exceptions, make loans or extensions of credit to, or investments in the securities of, its parent holding company. A subsidiary bank is also subject to collateral security requirements for any loan or extension of credit permitted by such exceptions.

Park National Bank may not pay dividends out of its surplus if, after paying these dividends, it would fail to meet the required minimum levels under the capital guidelines established by the OCC and the capital conservation buffer. In addition, Park National Bank must have the approval of the OCC if a dividend in any year would cause the total dividends for that year to exceed the sum of Park National Bank’s current year’s net income and the retained net income for the preceding two years, less required transfers to surplus. Payment of dividends by Park National Bank may be restricted at any time at the discretion of its regulatory authorities, if such regulatory authorities deem such dividends to constitute unsafe and/or unsound banking practices or if necessary to maintain adequate capital.

The ability of Park to obtain funds for the payment of dividends and for other cash requirements is largely dependent on the amount of dividends which may be declared by Park National Bank. However, the Federal Reserve Board expects Park to serve as a source of strength to Park National Bank, which may require Park to retain capital for further investment in Park National Bank, rather than pay dividends to the Park shareholders. Payment of dividends by Park National Bank may be restricted at any time at the discretion of the OCC if the OCC deems such dividends to constitute an unsafe and/or unsound banking practice. These provisions could have the effect of limiting Park’s ability to pay dividends on its Common Shares.

At December 31, 2016, approximately $71.7 million of the total shareholders’ equity of Park National Bank was available for payment to Park without the approval of the OCC. See Note 22 of the Notes to Consolidated Financial Statements of Park’s 2016 Annual Report.

The Federal Reserve Board has issued a policy statement with regard to the payment of cash dividends by financial holding companies and other bank holding companies. The policy statement provides that, as a matter of prudent banking, a financial holding company or bank holding company should not maintain a rate of cash dividends unless its net income available to common shareholders has been sufficient to fully fund the dividends, and the prospective rate of earnings retention appears to be consistent with the financial holding company or bank holding company’s capital needs, asset quality, and overall financial condition. Accordingly, a financial holding company or bank holding company should not pay cash dividends that exceed its net income or can only be funded in ways that weaken the financial holding company or bank holding company’s financial health, such as by borrowing.

Under the terms of the Indenture governing the $15.5 million of junior subordinated notes issued by Vision to the Vision Trust and the related Guarantee Agreement, Park, as successor to Vision in accordance with the First Supplemental Indenture, is prohibited, subject to limited exceptions, from declaring or paying any dividends or distributions on any shares of its capital stock (i) if an event of default under the Indenture has occurred and continues, (ii) if Park is in default with respect to the payment of any obligations under the Guarantee Agreement or (iii) during any period in which the payment of interest on the junior subordinated notes by Park (and the payment of cash distributions on the floating rate preferred securities of the Vision Trust) is being deferred.

The Note Purchase Agreement entered into by Park on April 20, 2012 (the "2012 Note Purchase Agreement") governs the 7% Subordinated Notes due April 20, 2022 issued by Park in April 2012. If an event of default occurs under the 2012 Note Purchase Agreement and is continuing, Park’s ability to declare or pay dividends on any of its capital stock will be restricted.

Volcker Rule

In December 2013, five federal agencies adopted a final regulation implementing the Volcker Rule provision of the Dodd-Frank Act (the "Volcker Rule"). The Volcker Rule places limits on the trading activity of insured depository institutions

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and entities affiliated with a depository institution, subject to certain exceptions. The trading activity includes a purchase or sale as principal of a security, derivative, commodity future or option on any such instrument in order to benefit from short-term price movements or to realize short-term profits. The Volcker Rule exempts specified United States Government, agency and/or municipal obligations, and it excepts trading conducted in certain capacities, including as a broker or other agent, through a deferred compensation or pension plan, as a fiduciary on behalf of customers, to satisfy a debt previously contracted, repurchase and securities lending agreements and risk-mitigating hedging activities.

The Volcker Rule also prohibits a banking entity from having an ownership interest in, or certain relationships with, a hedge fund or private equity fund, with a number of exceptions. To the extent that Park National Bank engages in any of the trading activities or has any ownership interest in or relationship with any of the types of funds regulated by the Volcker Rule, Park National Bank believes that its activities and relationships fall within the scope of the one or more of the exceptions provided in the Volcker Rule.

Privacy Provisions

Federal and state regulations limit the ability of banks and other financial institutions to disclose non-public information about consumers to nonaffiliated third parties. These limitations require disclosure of privacy policies to consumers and, in some circumstances, allow consumers to prevent disclosure of certain personal information to a nonaffiliated third party.

Patriot Act

In response to the terrorist events of September 11, 2001, the Uniting and Strengthening of America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001 (the “Patriot Act”) was signed into law in October 2001. The Patriot Act gives the United States government powers to address terrorist threats through enhanced domestic security measures, expanded surveillance powers, increased information sharing and broadened anti-money laundering requirements. Title III of the Patriot Act takes measures intended to encourage information sharing among bank regulatory agencies and law enforcement bodies. Further, certain provisions of Title III impose affirmative obligations on a broad range of financial institutions. Among other requirements, Title III and related regulations require regulated financial institutions to establish a program specifying procedures for obtaining identifying information from customers seeking to open new accounts and establish enhanced due diligence policies, procedures and controls designed to detect and report suspicious activity. Park National Bank has established policies and procedures that are believed to be compliant with the requirements of the Patriot Act.

Corporate Governance

As mandated by the Sarbanes-Oxley Act of 2002, the SEC has adopted rules and regulations governing, among other issues, corporate governance, auditing and accounting, executive compensation and enhanced and timely disclosure of corporate information. NYSE MKT has also adopted corporate governance rules. The Board of Directors of Park has taken a series of actions to strengthen and improve Park’s already strong corporate governance practices in light of the rules of the SEC and NYSE MKT. The Board of Directors has adopted charters for the Audit Committee, the Compensation Committee, the Executive Committee, the Investment Committee, the Nominating and Corporate Governance Committee (including as Exhibit A thereto, Corporate Governance Guidelines) and the Risk Committee as well as a Code of Business Conduct and Ethics governing the directors, officers and associates of Park and its affiliates.

Executive and Incentive Compensation

In June 2010, the Federal Reserve Board, the OCC and the FDIC issued joint interagency guidance on incentive compensation policies (the “Joint Guidance”) intended to ensure that the incentive compensation policies of banking organizations do not undermine the safety and soundness of such organizations by encouraging excessive risk-taking. This principles-based guidance, which covers all employees that have the ability to materially affect the risk profile of an organization, either individually or as part of a group, is based upon the key principles that a banking organization’s incentive compensation arrangements should: (i) provide incentives that do not encourage risk-taking beyond the organization’s ability to effectively identify and manage risks; (ii) be compatible with effective internal controls and risk management; and (iii) be supported by strong corporate governance, including active and effective oversight by the organization’s board of directors.

In 2011, federal banking regulatory agencies jointly issued proposed rules on incentive-based compensation arrangements under applicable provisions of the Dodd-Frank Act (the “First Proposed Joint Rules”). The First Proposed Joint Rules generally would have applied to financial institutions with $1.0 billion or more in assets that maintain incentive-based compensation arrangements for certain covered employees.

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In May 2016, the federal bank regulatory agencies approved a second joint notice of proposed rules (the “Second Proposed Joint Rules”) designed to prohibit incentive-based compensation arrangements that encourage inappropriate risks at financial institutions. The Second Proposed Joint Rules would apply to covered financial institutions with total assets of $1 billion or more. The requirements of the Second Proposed Joint Rules would differ for each of three categories of financial institutions:

• Level 1 consists of institutions with assets of $250 billion or more;

• Level 2 consists of institutions with assets of at least $50 billion and less than $250 billion; and

• Level 3 consists of institutions with assets of at least $1 billion and less than $50 billion.

Some of the requirements would apply only to Level 1 and Level 2 institutions. For all covered institutions, including Level 3 institutions like Park National Bank, the Second Proposed Joint Rules would:

• prohibit incentive-based compensation arrangements that are “excessive” or “could lead to material financial loss;”

• require incentive-based compensation that is consistent with a balance of risk and reward, effective management and control of risk, and effective governance; and

• require board oversight, recordkeeping and disclosure to the appropriate regulatory agency.

Level 1 and Level 2 institutions would have additional requirements, including deferrals of awards to certain covered persons; potential downward adjustments, forfeitures or clawbacks; and additional risk-management and control standards, policies and procedures. In addition, certain practices and types of incentive compensation would be prohibited.

Pursuant to rules adopted by the stock exchanges and approved by the SEC in January 2013 under the Dodd-Frank Act, public company compensation committee members must meet heightened independence requirements and consider the independence of compensation consultants, legal counsel and other advisors to the compensation committee. A compensation committee must have the authority to hire advisors and to have the public company fund reasonable compensation of such advisors.

Public companies will be required, once stock exchanges impose additional listing requirements under the Dodd-Frank Act, to implement "clawback" procedures for incentive compensation payments and to disclose the details of the procedures which allow recovery of incentive compensation that was paid on the basis of erroneous financial information necessitating a restatement due to material noncompliance with financial reporting requirements. This clawback policy is intended to apply to compensation paid within a three-year look-back window of the restatement and would cover all executives who received incentive awards.

Regulation of Consumer Finance Companies

As a consumer finance company incorporated under Ohio law, Guardian Finance is subject to regulation and supervision by the Ohio Division of Financial Institutions. Division regulation and supervision designed to protect consumers affect the lending activities of Guardian Finance, including interest rates and certain loan terms, advertising and record retention. If grounds provided by law exist, the Ohio Division of Financial Institutions may suspend or revoke an Ohio consumer finance company’s ability to make loans.

Statistical Disclosure

The statistical disclosure relating to Park and its subsidiaries required under the SEC’s Industry Guide 3, “Statistical Disclosure by Bank Holding Companies,” is included in the section of Park’s 2016 Annual Report captioned “MANAGEMENT'S DISCUSSION AND ANALYSIS” and in Note 1 - Summary of Significant Accounting Policies of the Notes to Consolidated Financial Statements in Park’s 2016 Annual Report, Note 4 - Investment Securities of the Notes to Consolidated Financial Statements in Park’s 2016 Annual Report, Note 5 - Loans of the Notes to Consolidated Financial Statements in Park’s 2016 Annual Report, Note 6 - Allowance for Loan Losses of the Notes to Consolidated Financial Statements in Park’s 2016 Annual Report, Note 11 - Deposits of the Notes to Consolidated Financial Statements in Park’s 2016 Annual Report and Note 13 - Short-Term Borrowings of the Notes to Consolidated Financial Statements in Park's 2016 Annual Report. This statistical disclosure is incorporated herein by reference.

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Effect of Environmental Regulation

Compliance with federal, state and local provisions regulating the discharge of materials into the environment, or otherwise relating to the protection of the environment, has not had a material effect upon the capital expenditures, earnings or competitive position of Park and its subsidiaries. Park believes the nature of the operations of its subsidiaries has little, if any, environmental impact. Park, therefore, anticipates no material capital expenditures for environmental control facilities for Park's current fiscal year or for the foreseeable future.

Park believes its primary exposure to environmental risk is through the lending activities of its subsidiaries. In cases where management believes environmental risk potentially exists, Park’s subsidiaries mitigate their environmental risk exposures by requiring environmental site assessments at the time of loan origination to confirm collateral quality as to commercial real estate parcels posing higher than normal potential for environmental impact, as determined by reference to present and past uses of the subject property and adjacent sites. In addition, environmental assessments are typically required prior to any foreclosure activity involving non-residential real estate collateral.

ITEM 1A. RISK FACTORS.

Cautionary Statement Regarding Forward-Looking Information

Certain statements contained in this Annual Report on Form 10-K which are not statements of historical fact constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including, without limitation, the statements specifically identified as forward-looking statements within this document. In addition, certain statements in future filings by Park with the SEC, in press releases, and in oral and written statements made by or with the approval of Park which are not statements of historical fact constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Examples of forward-looking statements include: (i) projections of income or expense, earnings per share, the payment or non-payment of dividends, capital structure and other financial items; (ii) statements of plans and objectives of Park or our management or Board of Directors, including those relating to products or services; (iii) statements of future economic performance; and (iv) statements of assumptions underlying such statements. Words such as “believes,” “anticipates,” “expects,” “intends,” “targeted” and similar expressions are intended to identify forward-looking statements but are not the exclusive means of identifying those statements.

The Private Securities Litigation Reform Act of 1995 provides a “safe harbor” for forward-looking statements to encourage companies to provide prospective information so long as those statements are identified as forward-looking and are accompanied by meaningful cautionary statements identifying important factors that could cause actual results to differ materially from those discussed in the forward-looking statements. We desire to take advantage of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995.

Forward-looking statements involve risks and uncertainties. Actual results may differ materially from those predicted by the forward-looking statements because of various factors and possible events, including those factors and events identified below. There is also the risk that Park’s management or Board of Directors incorrectly analyzes these risks and uncertainties or that the strategies Park develops to address them are unsuccessful.

Forward-looking statements speak only as of the date on which they are made, and, except as may be required by law, Park undertakes no obligation to update any forward-looking statement to reflect events or circumstances after the date on which the statement is made to reflect unanticipated events. All subsequent written and oral forward-looking statements attributable to Park or any person acting on Park’s behalf are qualified in their entirety by the following cautionary statements.

Changes in economic and political conditions could adversely affect our earnings through declines in our borrowers’ ability to repay loans, the value of the collateral securing our loans, and deposits.

Our success depends, to a certain extent, upon economic and political conditions, local and national, as well as governmental fiscal and monetary policies. Conditions such as inflation, recession, unemployment, changes in interest rates, fiscal and monetary policy and other factors beyond our control may adversely affect our asset quality, deposit levels and loan demand and, therefore, our earnings and our capital. The recent election of a new United States President is widely expected to result in substantial, unpredictable changes in economic and political conditions for the United States and the remainder of the world. Economic turmoil in Europe and Asia and changes in oil production in the Middle East affect the economy and stock prices in the United States, which can affect our earnings and our capital as well as the ability of our customers to repay loans. Because we have a significant amount of real estate loans, decreases in real estate values could adversely affect the value of property used as collateral and our ability to sell the collateral upon foreclosure. Adverse changes in the economy may also

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have a negative effect on the ability of our borrowers to make timely repayments of their loans, which would have an adverse impact on our earnings and cash flows. The substantial majority of the loans made by our subsidiaries are to individuals and businesses in Ohio. Consequently, a significant decline in the economy in Ohio could have a materially adverse effect on our financial condition and results of operations.

Changes in the general economic conditions and real estate valuations in our primary market areas could adversely impact results of operations, financial condition and cash flows.

Our lending and deposit gathering activities are concentrated primarily in Ohio. Our success depends on the general economic conditions of these areas, particularly given that a significant portion of our lending relates to real estate located in these regions. Adverse changes in the regional and general economic conditions could reduce our growth rate, impair our ability to collect payments on loans, increase loan delinquencies, increase problem assets and foreclosures, increase claims and lawsuits, increase devaluations recognized within our OREO portfolio, decrease the demand for our products and services and decrease the value of collateral for loans, especially real estate values, which could have a material adverse effect on our financial condition, results of operations and cash flows.

Legislative or regulatory changes or actions could adversely impact us or the businesses in which we are engaged.

The financial services industry is extensively regulated. We are subject to extensive state and federal regulation, supervision and legislation that govern almost all aspects of our operations. Laws and regulations may change from time to time and are primarily intended for the protection of consumers, depositors, borrowers, the FDIC’s Deposit Insurance Fund and the banking system as a whole, and not to benefit our shareholders. Regulations affecting banks and financial services businesses are undergoing continuous changes, and management cannot predict the effect of these changes. Moreover, the recently elected United States President and certain legislators have indicated an intention to make extensive changes to regulations affecting financial institutions. The impact of any changes to laws and regulations or other actions by regulatory agencies may negatively impact us or our ability to increase the value of our business. Regulatory authorities have extensive discretion in connection with their supervisory and enforcement activities, including the imposition of restrictions on the operation of an institution, the classification of assets held by an institution and the adequacy of an institution’s allowance for loan losses. Additionally, actions by regulatory agencies against us could cause us to devote significant time and resources to defending our business and may lead to penalties that materially affect us and our shareholders. Even the reduction of regulatory restrictions could have an adverse effect on us and our shareholders if such lessening of restrictions increases competition within our industry or our market area.

In light of current conditions in the global financial markets and the global economy that occurred in the last decade, regulators increased their focus on the regulation of the financial services industry. In the last several years, the United States Congress and the federal agencies regulating the financial services industry have acted on an unprecedented scale in responding to the stresses experienced in the global financial markets. Some of the laws enacted by the United States Congress and regulations promulgated by federal regulatory agencies subject us, and other financial institutions to which such laws and regulations apply, to additional restrictions, oversight and costs that may have an impact on our business, results of operations or the trading price of our Common Shares. In addition to laws, regulations and supervisory and enforcement actions directed at the operations of banks, proposals to reform the housing finance market consider winding down Fannie Mae and Freddie Mac, which could negatively affect our sales of loans.

In July 2013, Park's primary federal regulator, the Federal Reserve, published final rules (the “Basel III Capital Rules”) establishing a new comprehensive capital framework for U.S. banking organizations. The rules implement the Basel Committee's December 2010 framework known as “Basel III” for strengthening international capital standards as well as certain provisions of the Dodd-Frank Act. The Basel III Capital Rules substantially revise the risk-based capital requirements applicable to financial holding companies and other bank holding companies as well as depository institutions, including Park and Park National Bank, compared to the previous U.S. risk-based capital rules. The Basel III Capital Rules define the components of capital and address other issues affecting the numerator in banking institutions' regulatory capital ratios. The Basel III Capital Rules also address risk weights and other issues affecting the denominator in banking institutions' regulatory capital ratios and replace the existing risk-weighting approach, which was derived from Basel I capital accords of the Basel Committee, with a more risk-sensitive approach based, in part, on the standardized approach in the Basel Committee's 2004 “Basel II” capital accords. The Basel III Capital Rules also implement the requirements of Section 939A of the Dodd-Frank Act to remove references to credit ratings from the federal banking agencies' rules. The Basel III Capital Rules became effective for Park and Park National Bank on January 1, 2015 (subject to a phase-in period). Although the implementation of Basel III, once fully phased in, is not expected to have a material impact on Park's or Park National Bank's capital ratios, any future changes to capital requirements could have such an effect.

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We operate in a highly competitive environment, in terms of the products and services we offer and the geographic markets in which we conduct business, as well as in our labor markets where we compete for talented employees. Competition could adversely impact our customer acquisition, growth and retention, as well as our credit spreads and product pricing, causing us to lose market share and deposits and revenues.

We are subject to intense competition from various financial institutions as well as from non-bank entities that engage in many similar activities without being subject to bank regulatory supervision and restrictions. This competition is described in "Item 1 - Business" of this Annual Report on Form 10-K under the caption "Competition." Competition in our industry could intensify as a result of the increasing consolidation of financial services companies, in connection with current market conditions or otherwise. Consumers may also move money out of bank deposits in favor of other investments. Customers have increasingly used bill payment services that do not utilize banks. These trends may result in losses of deposits and fee income.

The principal bases for competition are pricing (including the interest rates charged on loans or paid on interest bearing deposits), product structure, the range of products and services offered, and the quality of customer service (including convenience and responsiveness to customer needs and concerns). The ability to access and use technology is an increasingly important competitive factor in the financial services industry, and it is a critically important component to customer satisfaction as it affects our ability to deliver the right products and services.

Another increasingly competitive factor in the financial services industry is the competition to attract and retain talented employees across many of our business and support areas. This competition leads to increased expenses in many business areas and can also cause us to not pursue certain business opportunities.

A failure to adequately address the competitive pressures we face could make it harder for us to attract and retain customers across our businesses. On the other hand, meeting these competitive pressures could require us to incur significant additional expense, to reevaluate the number of branches through which we serve our customers, or to accept risk beyond what we would otherwise view as desirable under the circumstances. In addition, in our interest rate sensitive businesses, pressures to increase rates on deposits or decrease rates on loans could reduce our net interest margin with a resulting negative impact on our net interest income.

Changes in interest rates could have a material adverse effect on our financial condition, results of operations and cash flows.

Our earnings and cash flows depend substantially on our interest rate spread, which is the difference between (i) the rates we earn on loans, investment securities and other interest earning assets and (ii) the interest rates we pay on deposits and our borrowings. These rates are highly sensitive to many factors beyond our control, including general economic conditions and the policies of various governmental and regulatory authorities. Changes in monetary policy influence the origination of loans, the prepayment speed of loans, the purchase of investments, the generation of deposits and rates of interest received and paid. While we have taken measures intended to manage the risks of operating in a changing interest rate environment, there can be no assurance that such measures will be effective in avoiding undue interest rate risk. Information pertaining to the impact changes in interest rates could have on our net income is included in Table 35 in the section of Park’s 2016 Annual Report captioned “MANAGEMENT'S DISCUSSION AND ANALYSIS,” and is incorporated herein by reference.  

We extend credit to a variety of customers based on internally set standards and the judgment of our loan officers and bank division presidents. We manage the credit risk through a program of underwriting standards, the review of certain credit decisions and an on-going process of assessing the quality of the credit already extended. Our credit standards and on-going process of credit assessment might not protect us from significant credit losses.

We take credit risk by virtue of making loans and leases, extending loan commitments and letters of credit and, to a lesser degree, purchasing non-governmental securities. Our exposure to credit risk is managed through the use of consistent underwriting standards that emphasize “in-market” lending while avoiding highly leveraged transactions as well as excessive industry and other concentrations. Our credit administration function employs risk management techniques to ensure that loans and leases adhere to corporate policy and problem loans and leases are promptly identified. While these procedures are designed to provide us with the information needed to implement policy adjustments where necessary, and to take proactive corrective actions, there can be no assurance that such measures will be effective in avoiding undue credit risk.

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Our business and financial results are subject to risks associated with the creditworthiness of our customers and counterparties.

Credit risk is inherent in the financial services business and results from, among other things, extending credit to customers, purchasing non-governmental securities, and entering into certain guarantee contracts. Credit risk is one of the most significant risks, particularly given the high percentage of our assets represented directly or indirectly by loans, and the importance of lending to our overall business. As discussed in the immediately preceding risk factor, we manage credit risk by assessing and monitoring the creditworthiness of our customers and by diversifying our loan portfolio. Many factors impact credit risk.

A borrower's ability to repay a loan can be adversely affected by individual factors, such as business performance, job losses or health issues. A weak or deteriorating economy and changes in the United States or global markets also could adversely impact the ability of our borrowers to repay outstanding loans. Any decrease in our borrowers' ability to repay loans would result in higher levels of nonperforming loans, net charge-offs and provision for loan losses.

Financial services institutions are interrelated as a result of trading, clearing and other relationships. We have exposure to many different industries and counterparties, and we routinely execute transactions with counterparties in the financial services industry. Many of these transactions expose us to credit risk in the event of default of our counterparty or client.

Despite maintaining a diversified portfolio, in the ordinary course of business, we may have concentrated credit exposure to a particular person or entity, industry or counterparty. Events adversely affecting specific customers, industries or markets, a decrease in the credit quality of a customer base or an adverse change in the risk profile of a market, industry or group of customers could adversely affect us.

Our credit risk may be exacerbated when collateral held by us to secure obligations to us cannot be realized upon or is liquidated at prices that are not sufficient to recover the full amount of the loan.

In part due to improvement in general economic conditions, as well as actions taken by Park to manage our portfolio, the provision for loan losses for Park's Ohio-based subsidiaries has declined since the end of the recent recession. If we were to experience higher levels of provision for loan losses, it could result in lower levels of net income.

Our allowance for loan losses may prove to be insufficient to absorb the probable, incurred losses in our loan portfolio.

Lending money is a substantial part of our business. However, every loan we make carries a risk of non-payment. This risk is affected by, among other things: the cash flow of the borrower and/or the project being financed; in the case of a collateralized loan, the changes and uncertainties as to the future value of the collateral, the credit history of a particular borrower, changes in economic and industry conditions, and the duration of the loan.

The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States (“GAAP”) requires management to make significant estimates that affect the financial statements. One of our most critical estimates is the level of the allowance for loan losses. Due to the inherent nature of these estimates, we cannot provide absolute assurance that we will not be required to charge earnings for significant unexpected loan losses.

We maintain an allowance for loan losses that we believe is a reasonable estimate of the probable, incurred losses within the loan portfolio. We make various assumptions and judgments about the collectability of our loan portfolio, including the creditworthiness of our borrowers and the value of the real estate and other assets serving as collateral for the repayment of loans. Through a periodic review and consideration of the loan portfolio, management determines the amount of the allowance for loan losses by considering general market conditions, the credit quality of the loan portfolio, the collateral supporting the loans and the performance of customers relative to their financial obligations with us. The amount of future losses is susceptible to changes in economic, operating and other conditions, including changes in interest rates, which may be beyond our control, and these losses may exceed current estimates. We cannot fully predict the amount or timing of losses or whether the loan loss allowance will be adequate in the future. If our assumptions prove to be incorrect, our allowance for loan losses may not be sufficient to cover the probable, incurred losses in our loan portfolio, resulting in additions to the allowance for loan losses. Excessive loan losses and significant additions to our allowance for loan losses could have a material adverse impact on our financial condition and results of operations.

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In addition, bank regulators periodically review our allowance for loan losses and may require us to increase our provision for loan losses or recognize further loan charge-offs. Moreover, the Financial Accounting Standards Board has changed its requirements for establishing the allowance for loan losses.  The new guidance is effective for annual reporting periods and interim reporting periods within those annual periods, beginning after December 15, 2019. Management is currently evaluating the impact of the adoption of this accounting guidance on Park's consolidated financial statements, but anticipates that it will result in a material increase to Park's allowance for loan losses. Management has established a committee to oversee the implementation of the new current expected credit loss model. This committee is currently assessing the data and system requirements necessary for adoption. Any significant increase in our allowance for loan losses or loan charge-offs as required by these regulatory authorities might have a material adverse effect on our financial condition and results of operations.

Deposit insurance premiums assessed on Park may increase and have a negative effect on Park’s results of operations.

The Deposit Insurance Fund (the “DIF”) maintained by the FDIC to resolve bank failures is funded by fees assessed on insured depository institutions. The costs of resolving bank failures increased for a period of time, decreasing the DIF balance. The FDIC collected a special assessment in 2009 to replenish the DIF and also required a prepayment of an estimated amount of future deposit insurance premiums. If the costs of future bank failures increase, deposit insurance premiums may also increase. The FDIC has recently adopted rules revising its assessments in a manner benefiting banks with assets totaling less than $10 billion. There can be no assurance, however, that assessments will not be changed in the future.

We depend upon the accuracy and completeness of information about customers and counterparties.

In deciding whether to extend credit or enter into other transactions with customers and counterparties, we may rely on information provided to us by customers and counterparties, including financial statements and other financial information. We may also rely on representations of customers and counterparties as to the accuracy and completeness of that information and, with respect to financial statements, on reports of independent auditors. For example, in deciding whether to extend credit to a business, we may assume that the customer’s audited financial statements conform with GAAP and present fairly, in all material respects, the financial condition, results of operations and cash flows of the customer. We may also rely on the audit report covering those financial statements. Our financial condition, results of operations and cash flows could be negatively impacted to the extent that we rely on financial statements that do not comply with GAAP or on financial statements and other financial information that are materially misleading.

We may be required to repurchase loans we have sold or indemnify loan purchasers under the terms of the sale agreements, which could adversely affect our liquidity, results of operations and financial condition.

When we sell a mortgage loan, we may agree to repurchase or substitute a mortgage loan if we are later found to have breached any representation or warranty we made about the loan or if the borrower is later found to have committed fraud in connection with the origination of the loan. While we have underwriting policies and procedures designed to avoid breaches of representations and warranties as well as borrower fraud, there can be no assurance that no breach or fraud will ever occur. Required repurchases, substitutions or indemnifications could have an adverse effect on our liquidity, results of operations and financial condition.

We are exposed to operational risk.

Similar to any large organization, we are exposed to many types of operational risk, including reputational risk, legal and compliance risk, the risk of fraud or theft by employees or outsiders, unauthorized transactions by employees or operational errors, including clerical or record-keeping errors or those resulting from faulty or disabled computer or telecommunications systems.

We may be subject to disruptions of our operating systems arising from events that are wholly or partially beyond our control, which may include, for example, computer viruses, cyber-attacks, spikes in transaction volume and/or customer activity, electrical or telecommunications outages, or natural disasters. Although we have programs in place related to business continuity, disaster recovery and information security to maintain the confidentiality, integrity and availability of our systems, business applications and customer information, such disruptions may give rise to interruptions in service to customers, loss of data privacy and loss or liability to us.

Any failure or interruption in our operations or information systems, or any security or data breach, could cause reputational damage, jeopardize the confidentiality of customer information, result in a loss of customer business, subject us to

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regulatory intervention or expose us to civil litigation and financial loss or liability, any of which could have a material adverse effect on us.

Negative public opinion can result from our actual or alleged conduct in any number of activities, including lending practices, corporate governance and acquisitions, and from actions taken by governmental regulators and community organizations in response to those activities. Negative public opinion can adversely affect our ability to attract and keep customers and can expose us to potential litigation and regulatory action.

Given the volume of transactions we process, certain errors may be repeated or compounded before they are discovered and successfully rectified. Our necessary dependence upon automated systems to record and process our transaction volume may further increase the risk that technical system flaws or employee tampering or manipulation of those systems will result in losses that are difficult to detect. We may also be subject to disruptions of our operating systems arising from events that are wholly or partially beyond our control (for example, computer viruses or electrical or telecommunications outages), which may give rise to disruption of service to customers and to financial loss or liability. We are further exposed to the risk that our external vendors may be unable to fulfill their contractual obligations (or will be subject to the same risk of fraud or operational errors by their respective employees as we are) and to the risk that our (or our vendors’) business continuity and data security systems prove to be inadequate.

Our business could be adversely affected by third-party service providers, data breaches and cyber-attacks.

We face the risk of operational disruption, failure or capacity constraints due to our dependency on third-party vendors for components of our business infrastructure. While we have selected these third-party vendors through our vendor management process, it does not control their operations. As such, any failure on the part of these business partners to perform their various responsibilities could also adversely affect our business and operations.

Further, we may be affected by data breaches at retailers and other third parties who participate in data interchanges with us and our customers that involve the theft of customer credit and debit card data, which may include the theft of our debit card PIN numbers and commercial card information used to make purchases at such retailers and other third parties. Such data breaches could result in us incurring significant expenses to reissue debit cards and cover losses, which could result in a material adverse effect on our results of operations.

Our assets at risk for cyber-attacks include financial assets and non-public information belonging to customers. We use several third-party vendors who have access to our assets via electronic media. Certain cyber security risks arise due to this access, including cyber espionage, blackmail, ransom, and theft. We employ many preventive and detective controls to protect our assets, and provide mandatory recurring information security training to all employees. To date, we have not experienced any material losses relating to cyber-attacks or other information security breaches, but there can be no assurance that we will not suffer such attacks or attempted breaches, or incur resulting losses in the future. Our risk and exposure to these matters remains heightened because of, among other things, the evolving nature of these threats, our plans to continue to implement Internet and mobile banking to meet customer demand, and the current economic and political environment. As cyber and other data security threats continue to evolve, we may be required to expend significant additional resources to continue to modify and enhance our protective measures or to investigate and remediate any security vulnerabilities.

Unauthorized disclosure of sensitive or confidential client or customer information, whether through a breach of our computer systems or otherwise, could severely harm our business.

As part of our financial institution business, we collect, process and retain sensitive and confidential client and customer information on behalf of our subsidiaries and other third parties. Despite the security measures we have in place, our facilities and systems, and those of our third-party service providers, may be vulnerable to security breaches, acts of vandalism, computer viruses, misplaced or lost data, programming and/or human errors or other similar events. If information security is breached, information can be lost or misappropriated, resulting in financial loss or costs to us. Any security breach involving confidential customer information, whether by us or by our vendors, could severely damage our reputation, expose us to the risks of litigation and liability or disrupt our operations and have a material adverse effect on our business.

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We could suffer a material adverse impact from interruptions in the effective operation of, or security breaches affecting, our computer systems.

We rely heavily on information systems to conduct our business and to process, record, and monitor our transactions. Risks to the systems result from a variety of factors, including the potential for bad acts on the part of hackers, criminals, employees and others. As one example, in recent years, some banks have experienced denial of service attacks in which individuals or organizations flood the bank’s website with extraordinarily high volumes of traffic, with the goal and effect of disrupting the ability of the bank to process transactions. We are also at risk for the impact of natural disasters, terrorism and international hostilities on our systems or for the effects of outages or other failures involving power or communications systems operated by others. These risks also arise from the same types of threats to businesses with which we deal.

Potential adverse consequences of attacks on our computer systems or other threats include damage to our reputation, loss of customer business, litigation and increased regulatory scrutiny, which might also result in financial loss and require additional efforts and expense to attempt to prevent such adverse consequences in the future.  

Changes in accounting standards, policies, estimates or procedures could impact our reported financial condition or results of operations.

The accounting standard setters, including the Financial Accounting Standards Board, the SEC and other regulatory bodies, periodically change the financial accounting and reporting guidance that governs the preparation of our consolidated financial statements. The pace of change continues to accelerate and changes in accounting standards can be hard to predict and could materially impact how we record and report our financial condition and results of operations. In some cases, we could be required to apply new or revised guidance retroactively, resulting in the restatement of prior period financial statements.

The preparation of consolidated financial statements in conformity with GAAP requires management to make significant estimates that affect the financial statements. Due to the inherent nature of these estimates, actual results may vary materially from management’s estimates. Additional information regarding Park’s critical accounting policies and the sensitivity of estimates can be found in the section captioned “MANAGEMENT'S DISCUSSION AND ANALYSIS - CRITICAL ACCOUNTING POLICIES” in Park’s 2016 Annual Report.

We may be a defendant from time to time in the future in a variety of litigation and other actions, which could have a material adverse effect on our financial condition, results of operations and cash flows.

We and our subsidiaries may be involved from time to time in the future in a variety of litigation arising out of our business. The risk of litigation increases in times of increased troubled loan collection activity. Our insurance may not cover all claims that may be asserted against us, and any claims asserted against us, regardless of merit or eventual outcome, may harm our reputation. Should the ultimate judgments or settlements in any litigation exceed our insurance coverage, they could have a material adverse effect on our financial condition, results of operations and cash flows. In addition, we may not be able to obtain appropriate types or levels of insurance in the future, nor may we be able to obtain adequate replacement policies with acceptable terms, if at all.

A default by another larger financial institution could adversely affect financial markets generally.

     The commercial soundness of many financial institutions may be closely interrelated as a result of relationships between and among the institutions. As a result, concerns about, or a default or threatened default by, one institution could lead to significant marketwide liquidity and credit problems, losses or defaults by other institutions. This is sometimes referred to as “systemic risk” and may adversely affect our business.

We may elect or be compelled to seek additional capital in the future, but that capital may not be available when it is needed.

     We are required by federal and state regulatory authorities to maintain adequate levels of capital to support our operations. Federal banking agencies have adopted extensive changes to their capital requirements, including raising required amounts and eliminating the inclusion of certain instruments from the calculation of capital. If we experience significant loan losses, additional capital may need to be infused. In addition, we may elect to raise additional capital to support our business or to finance acquisitions, if any, or we may otherwise elect or be required to raise additional capital. Our ability to raise additional capital, if needed, will depend on our financial performance, conditions in the capital markets, economic conditions and a number of other factors, many of which are outside our control. Accordingly, there can be no assurance that we can raise additional capital if needed or on terms acceptable to us. If we cannot raise additional capital when needed, it may have a material adverse effect on our financial condition, results of operations and prospects.

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We may not pay dividends on our Common Shares.

Although we have paid a dividend on our Common Shares every quarter since becoming a public company, the Board of Directors reviews the dividend on a quarterly basis and establishes the dividend rate based on Park’s financial condition, results of operations, capital and other regulatory requirements, and other factors which the Board of Directors deems relevant. As a financial holding company, we are a legal entity separate and distinct from our subsidiaries and affiliates. Our principal source of funds to pay dividends on our Common Shares and service our debt is dividends from our subsidiaries. In the event our subsidiaries become unable to pay dividends to us, we may not be able to service our debt, pay our other obligations or pay dividends on our Common Shares. Accordingly, our inability to receive dividends from our subsidiaries could also have a material adverse effect on our business, financial condition and results of operations.

Various federal and state statutory provisions and regulations limit the amount of dividends that Park National Bank and our other subsidiaries may pay to us without regulatory approval. In addition, the Federal Reserve Board and the OCC have issued policy statements that provide that insured banks as well as financial holding companies and other bank holding companies should generally only pay dividends out of current operating earnings. Thus, the ability of Park National Bank to pay dividends in the future is currently influenced, and could be further influenced, by bank regulatory policies and capital guidelines and may restrict our ability to declare and pay dividends.

Payment of dividends could also be subject to regulatory limitations if Park National Bank were to become “undercapitalized” for purposes of the applicable “prompt corrective action” regulations. “Undercapitalized” is currently defined as having a total risk-based capital ratio of less than 8.0%, a Tier 1 risk-based capital ratio of less than 6.0%, a common equity tier 1 capital ratio of less than 4.50%, or a core capital, or leverage, ratio of less than 4.0%. Throughout 2016 and 2017 to date, Park National Bank has been in compliance with all regulatory capital requirements and had sufficient capital under the “prompt corrective action” regulations to be deemed “well-capitalized.” There are also restrictions on the ability of Park National Bank to pay dividends if it does not hold the applicable capital conservation buffer.

If any of our subsidiaries becomes insolvent, the direct creditors of that subsidiary will have a prior claim on that subsidiary’s assets. Our rights and the rights of our creditors will be subject to that prior claim, unless we are also a direct creditor of that subsidiary.

Derivative transactions may expose us to unexpected risk and potential losses.

We are party to a number of derivative transactions. Many of these derivative instruments are individually negotiated and non-standardized, which can make exiting, transferring or settling the position difficult. We carry borrowings which contain embedded derivatives. These borrowing arrangements require that we deliver underlying securities to the counterparty as collateral. We are dependent on the creditworthiness of the counterparties and are therefore susceptible to credit and operational risk in these situations.

Derivative contracts and other transactions entered into with third parties are not always confirmed by the counterparties on a timely basis. While the transaction remains unconfirmed, we are subject to heightened credit and operational risk and, in the event of a default, may find it more difficult to enforce the contract. In addition, as new and more complex derivative products are created, covering a wider array of underlying credit and other instruments, disputes about the terms of the underlying contracts could arise, which could impair our ability to effectively manage our risk exposures from these products and subject us to increased costs. Any regulatory effort to create an exchange or trading platform for credit derivatives and other over-the-counter derivative contracts, or a market shift toward standardized derivatives, could reduce the risk associated with such transactions, but under certain circumstances could also limit our ability to develop derivatives that best suit the needs of our clients and ourselves and adversely affect our profitability.

Changes in tax laws could adversely affect our performance.

We are subject to extensive federal, state and local taxes, including income, excise, sales/use, payroll, franchise, withholding and ad valorem taxes. Changes to our taxes could have a material adverse effect on our results of operations. In addition, our customers are subject to a wide variety of federal, state and local taxes. Changes in taxes paid by our customers may adversely affect their ability to purchase homes or consumer products, which could adversely affect their demand for our loans and deposit products. In addition, such negative effects on our customers could result in defaults on the loans we have made and decrease the value of mortgage-backed securities in which we have invested.

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Future expansion may adversely affect our financial condition and results of operations as well as dilute the interests of our shareholders and negatively affect the price of our Common Shares.

We may acquire other financial institutions, or branches or assets of other financial institutions, in the future. We may also open new branches and enter into new lines of business or offer new products or services. Any such expansion of our business will involve a number of expenses and risks, which may include:

• the time and expense associated with identifying and evaluating potential expansions;

• the potential inaccuracy of estimates and judgments used to evaluate credit, operations, management and market risk with respect to target institutions;

• the time and costs of evaluating new markets, hiring local management and opening new offices, and the delay between commencing these activities and the generation of profits from the expansion;

• our financing of the expansion;

• the diversion of management’s attention to the negotiation of a transaction and the integration of the operations and personnel of the combining businesses;

• entry into unfamiliar markets;

• the introduction of new products and services into our existing business;

• the incurrence and possible impairment of goodwill associated with an acquisition and possible adverse short-term effects on our results of operations; and

• the risk of loss of key employees and customers.

We may incur substantial costs to expand, and we can give no assurance that such expansion will result in the levels of profits we expect. Neither can we assure that integration efforts for any future acquisitions will be successful. We may issue equity securities in connection with acquisitions, which could dilute the economic and voting interests of our existing shareholders.

ITEM 1B. UNRESOLVED STAFF COMMENTS.

No response required.

ITEM 2. PROPERTIES.

Park’s principal executive offices are located at 50 North Third Street, Newark, Ohio 43055.

Park National Bank

As of the date of this Annual Report on Form 10-K, Park National Bank, its divisions and its subsidiary Scope Leasing, Inc. have a total of 112 financial service offices in Ohio. Park National Bank has 6 financial service offices (including its main office) and 3 operations centers in Newark in Licking County. In addition, Park National Bank, and its divisions, have:

• financial service offices in Ashland, Loudonville and Perrysville in Ashland County;

• a financial service office in Athens in Athens County;

• a financial service office in West Chester in Butler County;

• financial service offices in Urbana (two offices), Mechanicsburg and North Lewisburg in Champaign County;

• financial service offices in Springfield (six offices), Enon, Medway, New Carlisle (two offices) and South Charleston in Clark County;

• financial service offices in Amelia, Cincinnati, Milford, New Richmond and Owensville in Clermont County;

• a financial service office in Coshocton in Coshocton County;

• financial service offices in Bucyrus, Crestline and Galion in Crawford County;

• financial service offices in Greenville (four offices), Arcanum and Versailles in Darke County;

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• financial service offices in Baltimore, Pickerington and Lancaster (six offices) in Fairfield County;

• financial service offices in Canal Winchester, Columbus, Gahanna, Reynoldsburg and Worthington in Franklin County;

• financial service offices in Jamestown and Xenia (two offices) in Greene County;

• financial service offices in Cincinnati (two offices) in Hamilton County;

• a financial service office in Logan in Hocking County;

• a financial service office in Millersburg in Holmes County;

• financial service offices (3 offices) and an operations center in Mount Vernon as well as financial service offices in Centerburg, Danville and Fredericktown, all in Knox County;

• financial service offices in Granville, Heath (two offices), Hebron, Johnstown, Pataskala, and Utica in Licking County;

• a financial service office in Plain City in Madison County;

• financial service offices in Caledonia, Marion and Prospect in Marion County;

• financial service offices in Celina and Fort Recovery in Mercer County;

• financial service offices (two offices) and an operations center in Piqua as well as financial service offices in Tipp City and Troy, all in Miami County;

• a financial service office in Mount Gilead in Morrow County;

• financial service offices in Zanesville (eight offices), New Concord and Dresden in Muskingum County;

• a financial service office in New Lexington in Perry County;

• financial service offices in Bellville, Mansfield (seven offices), Butler, Lexington, Ontario and Shelby in Richland County;

• financial service offices in Newcomerstown and New Philadelphia in Tuscarawas County;

• a financial service office in Springboro in Warren County; and

• a financial service office in Wooster in Wayne County.

The financial service offices in Athens, Coshocton, Hocking, Muskingum, Perry and Tuscarawas Counties comprise the Century National Bank Division. The financial service offices in Canal Winchester and Reynoldsburg in Franklin County and in Fairfield County comprise the Fairfield National Bank Division. The financial service offices in Ashland County comprise the Farmers Bank Division. The financial service offices in Bellville in Richland County and in Holmes, Knox, Morrow and Wayne Counties comprise the First-Knox National Bank Division. The financial service offices in Butler, Clermont and Hamilton Counties comprise The Park National Bank of Southwest Ohio & Northern Kentucky Division. The financial service offices in Richland County (except the Bellville office) comprise the Richland Bank Division. The financial service offices in Darke and Mercer Counties comprise the Second National Bank Division. The financial service offices in Champaign, Clark, Greene, Madison and Warren Counties comprise the Security National Bank Division. The financial service offices in Crawford and Marion Counties comprise the United Bank, N.A. Division. The financial service offices in Miami County comprise the Unity National Bank Division. Of the financial service offices described above, 23 are leased and the remainder are owned. Park National Bank also operates 31 off-site automated teller machines.

Scope Leasing, Inc. has an office located in Columbus in Franklin County, Ohio, which it leases.

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Guardian Finance

As of the date of this Annual Report on Form 10-K, Guardian Finance has a total of five financial service offices, all of which are located in Ohio. Guardian Finance has its main office in Hilliard in Franklin County, a financial service office in Springfield in Clark County, a financial service office in Lancaster in Fairfield County where it leases space from the Fairfield National Bank Division of Park National Bank, a financial service office in Heath in Licking County, and a financial service office in Centerville in Montgomery County. All of Guardian Finance’s financial service offices are leased.

SE Property Holdings, LLC

SEPH has one office located in Newark in Licking County, Ohio, which it leases.

ITEM 3. LEGAL PROCEEDINGS.

The Company is a defendant in lawsuits and other adversary proceedings arising in the ordinary course of business. Legal costs incurred in connection with the resolution of claims and lawsuits are generally expensed as incurred, and the Company establishes accruals for the outcome of litigation where losses are deemed probable and reasonably estimable. The Company’s assessment of the current exposure could change in the event of the discovery of additional facts with respect to legal matters pending against the Company or determinations by judges, juries, administrative agencies or other finders of fact that are not in accordance with the Company’s evaluation of claims.

As of December 31, 2016, the Company had accrued charges of approximately $2.3 million for legal contingencies related to various legal and other adversary proceedings.

ITEM 4. MINE SAFETY DISCLOSURES.

Not applicable.

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PART II

ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES.

The information called for in this Item 5 by Items 201(a) through 201(c) of SEC Regulation S-K is incorporated herein by reference from “Table 41 – Market and Dividend Information” and the accompanying disclosure in the section of Park’s 2016 Annual Report captioned “MANAGEMENT'S DISCUSSION AND ANALYSIS.”

The following table provides information regarding purchases of Park's Common Shares made by or on behalf of Park or any "affiliated purchaser" as defined in Rule 10b-18(a)(3) under the Exchange Act during the fiscal quarter ended December 31, 2016. The table also provides information concerning the maximum number of Common Shares that may be purchased under Park’s previously-announced stock repurchase authorization to fund the Park National Corporation 2013 Long-Term Incentive Plan (the "2013 Incentive Plan"):

Period	Total Number of Common Shares Purchased	Average Price Paid per Common Share	Total Number of Common Shares Purchased as Part of Publicly Announced Plans or Programs	Maximum Number of Common Shares that May Yet Be Purchased under the Plans or Programs (1)
October 1 through October 31, 2016	—	—	—	488,050
November 1 through November 30, 2016	—	—	—	488,050
December 1 through December 31, 2016	—	—	—	488,050
Total	—	—	—

(1) The number shown represents, as of the end of each period, the maximum number of Common Shares that may yet be purchased as part of Park’s publicly announced stock repurchase authorization to fund the 2013 Incentive Plan which became effective on April 22, 2013.

At the 2013 Annual Meeting of Shareholders held on April 22, 2013, Park's shareholders approved the 2013 Incentive Plan. The aggregate number of Common Shares with respect to which awards may be granted under the 2013 Incentive Plan will be 600,000. The Common Shares to be issued and delivered under the 2013 Incentive Plan may consist of either Common Shares currently held or Common Shares subsequently acquired by Park as treasury shares. No newly-issued Common Shares will be delivered under the 2013 Incentive Plan. On April 22, 2013, Park's Board of Directors authorized the purchase, from time to time, of up to 600,000 Park Common Shares to be held as treasury shares for subsequent issuance and delivery under the 2013 Incentive Plan. As of December 31, 2016, 111,950 Common Shares had been purchased for this purpose.

On January 23, 2017, Park announced that the Park Board of Directors had, on that same date, authorized Park to purchase, from time to time, up to an aggregate of 500,000 Common Shares. Purchases may be made through NYSE MKT, in the over-the-counter market or in privately negotiated transactions, in each case in compliance with applicable laws and regulations and the rules applicable to issuers having securities listed on NYSE MKT. Purchases will be made upon such terms and conditions and at such times and in such amounts as any one or more of the authorized officers of Park deem to be appropriate, subject to market conditions, regulatory requirements and other factors, and in the best interest of Park and Park's shareholders. The January 23, 2017 stock repurchase authorization is distinct from the stock repurchase authorization to fund the 2013 Incentive Plan and, due to its timing, the January 23, 2017 stock repurchase authorization is not reflected in the table set forth above.

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ITEM 6. SELECTED FINANCIAL DATA.

The information called for in this Item 6 is incorporated herein by reference from “Table 39 – Consolidated Five-Year Selected Financial Data” and the accompanying disclosure in the section of Park’s 2016 Annual Report captioned “MANAGEMENT'S DISCUSSION AND ANALYSIS.”

ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

The information called for in this Item 7 is incorporated herein by reference from the section of Park’s 2016 Annual Report captioned “MANAGEMENT'S DISCUSSION AND ANALYSIS.”

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

As noted in Table 16 included in the section of Park’s 2016 Annual Report captioned “MANAGEMENT'S DISCUSSION AND ANALYSIS,” Park’s tax equivalent net interest margin increased by 13 basis points in 2016 and declined by 16 basis points in 2015. Consistently, over the last several years, Park’s earnings simulation model has projected that changes in interest rates would have only a small impact on net income and the tax equivalent net interest margin. The tax equivalent net interest margin was 3.52%, 3.39% and 3.55% for each of the fiscal years ended December 31, 2016, 2015 and 2014, respectively. The discussion of interest rate sensitivity included in the section of Park’s 2016 Annual Report captioned “MANAGEMENT'S DISCUSSION AND ANALYSIS – CAPITAL RESOURCES – Liquidity and Interest Rate Sensitivity Management” is incorporated herein by reference. In addition, the discussion of Park’s commitments, contingent liabilities and off-balance sheet arrangements included in Park’s 2016 Annual Report under the caption “MANAGEMENT'S DISCUSSION AND ANALYSIS – CONTRACTUAL OBLIGATIONS – Commitments, Contingent Liabilities, and Off-Balance Sheet Arrangements,” and in Note 23 of the Notes to Consolidated Financial Statements included in Park’s 2016 Annual Report, is incorporated herein by reference.

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.

The Consolidated Balance Sheets of Park and its subsidiaries at December 31, 2016 and 2015, the related Consolidated Statements of Income, of Comprehensive Income, of Changes in Shareholders’ Equity and of Cash Flows for the years ended December 31, 2016, 2015 and 2014, the related Notes to Consolidated Financial Statements and the Report of Independent Registered Public Accounting Firm (Crowe Horwath LLP) in Park’s 2016 Annual Report, are incorporated herein by reference. Quarterly Financial Data provided in “Table 40 – Quarterly Financial Data” and the accompanying disclosure included in the section of Park’s 2016 Annual Report captioned “MANAGEMENT'S DISCUSSION AND ANALYSIS,” are also incorporated herein by reference.

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.

No response required.

ITEM 9A. CONTROLS AND PROCEDURES.

Evaluation of Disclosure Controls and Procedures

With the participation of the Chief Executive Officer and President (the principal executive officer) and the Chief Financial Officer, Secretary and Treasurer (the principal financial officer) of Park, Park’s management has evaluated the effectiveness of Park’s disclosure controls and procedures (as defined in Rule 13a-15(e) under the Exchange Act) as of the end of the fiscal year covered by this Annual Report on Form 10-K. Based on that evaluation, Park’s Chief Executive Officer and President and Park’s Chief Financial Officer, Secretary and Treasurer have concluded that:

• information required to be disclosed by Park in this Annual Report on Form 10-K and the other reports that Park files or submits under the Exchange Act would be accumulated and communicated to Park’s management, including its principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure;

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• information required to be disclosed by Park in this Annual Report on Form 10-K and the other reports that Park files or submits under the Exchange Act would be recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms; and

• Park’s disclosure controls and procedures were effective as of the end of the fiscal year covered by this Annual Report on Form 10-K.

Management’s Annual Report on Internal Control over Financial Reporting

The “MANAGEMENT’S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING” included in Park’s 2016 Annual Report is incorporated herein by reference.

Attestation Report of the Registered Public Accounting Firm

The “REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM” included in Park’s 2016 Annual Report is incorporated herein by reference.

Changes in Internal Control over Financial Reporting

There were no changes in Park’s internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act) that occurred during Park’s fiscal quarter ended December 31, 2016, that have materially affected, or are reasonably likely to materially affect, Park’s internal control over financial reporting.

ITEM 9B. OTHER INFORMATION.

No response required.

PART III

ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE.

Directors, Executive Officers and Persons Nominated or Chosen to Become Directors or Executive Officers

The information required by Item 401 of SEC Regulation S-K concerning the directors of Park and the nominees for election as directors of Park at the Annual Meeting of Shareholders to be held on April 24, 2017 (the “2017 Annual Meeting”) is incorporated herein by reference from the disclosure to be included under the caption “ELECTION OF DIRECTORS (Proposal 1)” in Park’s definitive Proxy Statement relating to the 2017 Annual Meeting to be filed pursuant to SEC Regulation 14A (“Park’s 2017 Proxy Statement”).

The information required by Item 401 of SEC Regulation S-K concerning the executive officers of Park is incorporated herein by reference from the disclosure to be included under the caption “EXECUTIVE OFFICERS” in Park’s 2017 Proxy Statement.

Compliance with Section 16(a) of the Exchange Act

The information required by Item 405 of SEC Regulation S-K is incorporated herein by reference from the disclosure to be included under the caption “BENEFICIAL OWNERSHIP OF PARK COMMON SHARES – Section 16(a) Beneficial Ownership Reporting Compliance” in Park’s 2017 Proxy Statement.

Committee Charters; Corporate Governance Guidelines; Code of Business Conduct and Ethics

Park’s Board of Directors has adopted charters for each of the Audit Committee, the Compensation Committee, the Executive Committee, the Investment Committee, the Nominating and Corporate Governance Committee and the Risk Committee. Park's Board of Directors has also adopted Corporate Governance Guidelines which are included as Exhibit A to the charter of the Nominating and Corporate Governance Committee.

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In accordance with the requirements of Section 807 of the NYSE MKT Company Guide, the Board of Directors of Park has adopted a Code of Business Conduct and Ethics covering the directors, officers and employees of Park and Park's affiliates, including Park’s Chairman of the Board, Park's Chief Executive Officer and President (the principal executive officer), Park’s Chief Financial Officer, Secretary and Treasurer (the principal financial officer) and Park’s Chief Accounting Officer (the principal accounting officer). Park intends to disclose the following events, if they occur, in a current report on Form 8-K within four business days following their occurrence: (A) the date and nature of any amendment to a provision of Park’s Code of Business Conduct and Ethics that (i) applies to Park’s principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions, (ii) relates to any element of the code of ethics definition enumerated in Item 406(b) of SEC Regulation S-K, and (iii) is not a technical, administrative or other non-substantive amendment; and (B) a description of any waiver (including the nature of the waiver, the name of the person to whom the waiver was granted and the date of the waiver), including an implicit waiver, from a provision of the Code of Business Conduct and Ethics granted to Park’s principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions that relates to one or more of the elements of the code of ethics definition set forth in Item 406(b) of SEC Regulation S-K. In addition, Park will disclose any waivers from the provisions of the Code of Business Conduct and Ethics granted to a director or executive officer of Park in a current report on Form 8-K within four business days following their occurrence in accordance with the requirements of Section 807 of the NYSE MKT Company Guide.

The text of each of the Code of Business Conduct and Ethics, the Audit Committee Charter, the Compensation Committee Charter, the Executive Committee Charter, the Investment Committee Charter, the Nominating and Corporate Governance Committee Charter (including the Corporate Governance Guidelines) and the Risk Committee Charter is posted on the “Governance Documents” section of the “Investor Relations” page of Park’s Internet site located at http://www.parknationalcorp.com. Interested persons may also obtain copies of the Code of Business Conduct and Ethics, the Audit Committee Charter, the Compensation Committee Charter, the Executive Committee Charter, the Investment Committee Charter, the Nominating and Corporate Governance Committee Charter and the Risk Committee Charter, without charge, by writing to the Chief Financial Officer, Secretary and Treasurer of Park at Park National Corporation, 50 North Third Street, P.O. Box 3500, Newark, Ohio 43058-3500, Attention: Brady T. Burt.

Procedures for Recommending Director Nominees

Information concerning the procedures by which shareholders of Park may recommend nominees to Park’s Board of Directors is incorporated herein by reference from the disclosure to be included under the caption “CORPORATE GOVERNANCE – Nominating Procedures” in Park’s 2017 Proxy Statement. These procedures have not materially changed from those described in Park’s definitive Proxy Statement for the 2016 Annual Meeting of Shareholders held on April 25, 2016.

Audit Committee

The information required by Items 407(d)(4) and 407(d)(5) of SEC Regulation S-K is incorporated herein by reference from the disclosure to be included under the caption “STRUCTURE AND MEETINGS OF BOARD OF DIRECTORS – Committees of the Board – Audit Committee” in Park’s 2017 Proxy Statement.

ITEM 11. EXECUTIVE COMPENSATION.

The information required by Item 402 of SEC Regulation S-K is incorporated herein by reference from the disclosure to be included under the captions “EXECUTIVE COMPENSATION” and “DIRECTOR COMPENSATION” in Park’s 2017 Proxy Statement.

The information required by Item 407(e)(4) of SEC Regulation S-K is incorporated herein by reference from the disclosure to be included under the caption “COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION” in Park’s 2017 Proxy Statement.

The information required by Item 407(e)(5) of SEC Regulation S-K is incorporated herein by reference from the disclosure to be included under the caption “EXECUTIVE COMPENSATION – Compensation Committee Report” in Park’s 2017 Proxy Statement.

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ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS.

Beneficial Ownership of Common Shares of Park

The information required by Item 403 of SEC Regulation S-K is incorporated herein by reference from the disclosure to be included under the caption “BENEFICIAL OWNERSHIP OF PARK COMMON SHARES” in Park’s 2017 Proxy Statement.

Equity Compensation Plan Information

The information required by Item 201(d) of SEC Regulation S-K is incorporated herein by reference from the disclosure to be included under the caption "EQUITY COMPENSATION PLAN INFORMATION" in Park's 2017 Proxy Statement.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE.

Certain Relationships and Related Person Transactions

The information required by Item 404 of SEC Regulation S-K is incorporated herein by reference from the disclosure to be included under the captions “CORPORATE GOVERNANCE – Independence of Directors,” “CORPORATE GOVERNANCE – Transactions with Related Persons” and “COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION” in Park’s 2017 Proxy Statement.

Director Independence

The information required by Item 407(a) of SEC Regulation S-K is incorporated herein by reference from the disclosure to be included under the caption “CORPORATE GOVERNANCE – Independence of Directors” in Park’s 2017 Proxy Statement.

ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES.

The information called for in this Item 14 is incorporated herein by reference from the disclosure to be included under the captions “AUDIT COMMITTEE MATTERS – Pre-Approval of Services Performed by Independent Registered Public Accounting Firm” and “AUDIT COMMITTEE MATTERS – Fees of Independent Registered Public Accounting Firm” in Park’s 2017 Proxy Statement.

PART IV

ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.

(a)(1)     Financial Statements.

The consolidated financial statements (and report thereon) listed below are incorporated herein by reference from Park's 2016 Annual Report as noted:

Report of Independent Registered Public Accounting Firm (Crowe Horwath LLP) -- Incorporated herein by reference from Park's 2016 Annual Report

Consolidated Balance Sheets at December 31, 2016 and 2015 -- Incorporated herein by reference from Park's 2016 Annual Report

Consolidated Statements of Income for the years ended December 31, 2016, 2015 and 2014 -- Incorporated herein by reference from Park's 2016 Annual Report

Consolidated Statements of Comprehensive Income for the years ended December 31, 2016, 2015 and 2014 -- Incorporated herein by reference from Park's 2016 Annual Report

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Consolidated Statements of Changes in Shareholders' Equity for the years ended December 31, 2016, 2015 and 2014 -- Incorporated herein by reference from Park's 2016 Annual Report

Consolidated Statements of Cash Flows for the years ended December 31, 2016, 2015 and 2014 -- Incorporated herein by reference from Park's 2016 Annual Report

Notes to Consolidated Financial Statements -- Incorporated herein by reference from Park's 2016 Annual Report

(a)(2)     Financial Statement Schedules.

All schedules for which provision is made in the applicable accounting regulations of the SEC are not required under the related instructions or are inapplicable and have been omitted.

(a)(3)     Exhibits.

The documents listed in the Index to Exhibits that follows the Signatures page of this Annual Report on Form 10-K are filed/furnished with this Annual Report on Form 10-K as exhibits or incorporated into this Annual Report on Form 10-K by reference. Each management contract or compensatory plan or arrangement is identified as such in the Index to Exhibits.

(b) The documents listed in the Index to Exhibits that follows the Signatures page of this Annual Report on Form 10-K are filed/furnished with this Annual Report on Form 10-K as exhibits or incorporated into this Annual Report on Form 10-K by reference.

(c) Financial Statement Schedules

None.

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SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized.

	PARK NATIONAL CORPORATION
Date: February 21, 2017	By:	/s/ David L. Trautman
		David L. Trautman,
		Chief Executive Officer and President

Pursuant to the requirements of the Securities Exchange Act of 1934, this Report has been signed below by the following persons on behalf of the Registrant and in the capacities indicated on the 21st day of February, 2017.

Name	Capacity
/s/ David L. Trautman David L. Trautman	Chief Executive Officer, President and Director
/s/ C. Daniel DeLawder C. Daniel DeLawder	Chairman of the Board and Director
/s/ Brady T. Burt Brady T. Burt	Chief Financial Officer, Secretary and Treasurer
/s/ Matthew R. Miller Matthew R. Miller	Chief Accounting Officer
/s/ Donna M. Alvarado* Donna M. Alvarado	Director
/s/ James R. DeRoberts* James R. DeRoberts	Director
/s/ F. William Englefield IV* F. William Englefield IV	Director
/s/ Alicia J. Hupp* Alicia J. Hupp	Director
/s/ Stephen J. Kambeitz* Stephen J. Kambeitz	Director
/s/ Timothy S. McLain* Timothy S. McLain	Director
/s/ Robert E. O’Neill* Robert E. O’Neill	Director

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Name	Capacity
/s/ Julia A. Sloat* Julia A. Sloat	Director
/s/ Rick R. Taylor* Rick R. Taylor	Director
/s/ Leon Zazworsky* Leon Zazworsky	Director

__________________________

* The above-named directors of the Registrant sign this Annual Report on Form 10-K by David L. Trautman, their attorney-in-fact, pursuant to Powers of Attorney signed by the above-named directors, which Powers of Attorney are filed with this Annual Report on Form 10-K as exhibits, in the capacities indicated and on the 21st day of February, 2017.

By:	/s/ David L. Trautman
	David L. Trautman
	Chief Executive Officer and President

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INDEX TO EXHIBITS

Exhibit No.Description of Exhibit

3.1(a) Articles of Incorporation of Park National Corporation as filed with the Ohio Secretary of State on March 24, 1992 (incorporated herein by reference to Exhibit 3(a) to Park National Corporation's Form 8-B, filed on May 20, 1992 (File No. 0-18772) (“Park's Form 8-B”))

3.1(b) Certificate of Amendment to the Articles of Incorporation of Park National Corporation as filed with the Ohio Secretary of State on May 6, 1993 (incorporated herein by reference to Exhibit 3(b) to Park National Corporation's Annual Report on Form 10-K for the fiscal year ended December 31, 1993 (File No. 0-18772))

3.1(c) Certificate of Amendment to the Articles of Incorporation of Park National Corporation as filed with the Ohio Secretary of State on April 16, 1996 (incorporated herein by reference to Exhibit 3(a) to Park National Corporation's Quarterly Report on Form 10-Q for the quarterly period ended March 31, 1996 (File No. 1-13006))

3.1(d) Certificate of Amendment by Shareholders to the Articles of Incorporation of Park National Corporation as filed with the Ohio Secretary of State on April 22, 1997 (incorporated herein by reference to Exhibit 3(a)(1) to Park National Corporation's Quarterly Report on Form 10-Q for the quarterly period ended June 30, 1997 (File No. 1-13006) (“Park's June 30, 1997 Form 10-Q”))

3.1(e) Certificate of Amendment by Shareholders as filed with the Secretary of State of the State of Ohio on December 18, 2008 in order to evidence the adoption by the shareholders of Park National Corporation on December 18, 2008 of an amendment to Article FOURTH of Park National Corporation's Articles of Incorporation to authorize Park National Corporation to issue up to 200,000 preferred shares, without par value (incorporated herein by reference to Exhibit 3.1 to Park National Corporation's Current Report on Form 8-K dated and filed December 19, 2008 (File No. 1-13006))

3.1(f) Certificate of Amendment by Directors to Articles as filed with the Secretary of State of the State of Ohio on December 19, 2008, evidencing adoption of amendment by Board of Directors of Park National Corporation to Article FOURTH of Articles of Incorporation to establish express terms of Fixed Rate Cumulative Perpetual Preferred Shares, Series A, each without par value, of Park National Corporation (incorporated herein by reference to Exhibit 3.1 to Park National Corporation's Current Report on Form 8-K dated and filed December 23, 2008 (File No. 1-13006) (“Park's December 23, 2008 Form 8-K”))

3.1(g) Certificate of Amendment by Shareholders as filed with the Secretary of State of the State of Ohio on April 18, 2011 in order to evidence the adoption by Park National Corporation's shareholders of an amendment to Article SIXTH of Park National Corporation's Articles of Incorporation in order to provide that shareholders do not have preemptive rights (incorporated herein by reference to Exhibit 3.1 to Park National Corporation's Current Report on Form 8-K dated and filed April 19, 2011 (File No. 1-13006))

3.1(h) Articles of Incorporation of Park National Corporation (reflecting all amendments) [for SEC reporting compliance purposes only - not filed with Ohio Secretary of State] (incorporated herein by reference to Exhibit 3.1(h) to Park National Corporation's Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2011 (File No. 1-13006))

3.2(a) Regulations of Park National Corporation (incorporated herein by reference to Exhibit 3(b) to Park's Form 8-B)

3.2(b) Certified Resolution regarding Adoption of Amendment to Subsection 2.02(A) of the Regulations of Park National Corporation by Shareholders on April 21, 1997 (incorporated herein by reference to Exhibit 3(b)(1) to Park's June 30, 1997 Form 10-Q)

3.2(c) Certificate Regarding Adoption of Amendments to Sections 1.04 and 1.11 of Park National Corporation's Regulations by the Shareholders on April 17, 2006 (incorporated herein by reference to Exhibit 3.1 to Park National Corporation's Current Report on Form 8-K dated and filed on April 18, 2006 (File No. 1-13006))

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3.2(d) Certificate Regarding Adoption by the Shareholders of Park National Corporation on April 21, 2008 of Amendment to Regulations to Add New Section 5.10 to Article FIVE (incorporated herein by reference to Exhibit 3.2(d) to Park National Corporation's Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2008 (File No. 1-13006) (“Park's March 31, 2008 Form 10-Q”))

3.2(e) Regulations of Park National Corporation (reflecting all amendments) [For purposes of SEC reporting compliance only] (incorporated herein by reference to Exhibit 3.2 (e) to Park's March 31, 2008 Form 10-Q)

4.1(a) Junior Subordinated Indenture, dated as of December 5, 2005, between Vision Bancshares, Inc. and Wilmington Trust Company, as Trustee (incorporated herein by reference to Exhibit 10.16 to Vision Bancshares, Inc.'s Annual Report on Form 10-KSB for the fiscal year ended December 31, 2005 (File No. 000-50719))

4.1(b) First Supplemental Indenture, dated to be effective as of 6:00 p.m., Eastern Standard Time, on March 9, 2007, among Wilmington Trust Company, as Trustee; Park National Corporation; and Vision Bancshares, Inc. (incorporated herein by reference to Exhibit 4.1(b) to Park National Corporation's Current Report on Form 8-K dated and filed March 15, 2007 (File No. 1-13006) (“Park's March 15, 2007 Form 8-K”))

4.2(a) Amended and Restated Trust Agreement, dated as of December 5, 2005, among Vision Bancshares, Inc., as Depositor; Wilmington Trust Company, as Property Trustee and as Delaware Trustee; and the Administrative Trustees named therein, in respect of Vision Bancshares Trust I (incorporated herein by reference to Exhibit 10.15 to Vision Bancshares, Inc.'s Annual Report on Form 10-KSB for the fiscal year ended December 31, 2005 (File No. 000-50719))

Note: Pursuant to the First Supplemental Indenture, dated to be effective as of 6:00 p.m., Eastern Standard Time, on March 9, 2007, among Wilmington Trust Company, as Trustee; Park National Corporation; and Vision Bancshares, Inc., Park National Corporation succeeded to and was substituted for Vision Bancshares, Inc. as “Depositor”

4.2(b) Notice of Resignation of Administrative Trustees and Appointment of Successors, dated March 9, 2007, delivered to Wilmington Trust Company by the Resigning Administrative Trustees named therein, the Successor Administrative Trustees named therein and Park National Corporation (incorporated herein by reference to Exhibit 4.2(b) to Park's March 15, 2007 Form 8-K)

4.2(c) Notice of Removal of Administrative Trustee and Appointment of Successor, dated February 21, 2013, delivered to Wilmington Trust Company by the continuing Administrative Trustees named therein, the successor Administrative Trustee named therein and Park National Corporation (incorporated herein by reference to Exhibit 4.2(c) to Park National Corporation's Annual Report on Form 10-K for the fiscal year ended December 31, 2012 (File No. 1-13006) ("Park's 2012 Form 10-K"))

4.3 Guarantee Agreement, dated as of December 5, 2005, between Vision Bancshares, Inc., as Guarantor, and Wilmington Trust Company, as Guarantee Trustee, in respect of Vision Bancshares Trust I (incorporated herein by reference to Exhibit 10.17 to Vision Bancshares, Inc.'s Annual Report on Form 10-KSB for the fiscal year ended December 31, 2005 (File No. 000-50719))

Note: Pursuant to the First Supplemental Indenture, dated to be effective as of 6:00 p.m., Eastern Standard Time, on March 9, 2007, among Wilmington Trust Company, as Trustee; Park National Corporation; and Vision Bancshares, Inc., Park National Corporation succeeded to and was substituted for Vision Bancshares, Inc. as “Guarantor”

4.4 Note Purchase Agreement, dated December 23, 2009, between Park National Corporation and 38 accredited investors (incorporated herein by reference to Exhibit 4.1 to Park National Corporation's Current Report on Form 8-K dated and filed on December 28, 2009 (File No. 1-13006) (“Park's December 28, 2009 Form 8-K”))

Note: 10% Subordinated Notes due December 23, 2019 were repaid in full on December 24, 2014 and Note Purchase Agreement terminated by its terms.

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4.5 Form of 10% Subordinated Note due December 23, 2019 (incorporated herein by reference to Exhibit 4.2 to Park's December 28, 2009 Form 8-K)

Note: 10% Subordinated Notes due December 23, 2019 were repaid in full on December 24, 2014.

4.6 Note Purchase Agreement, dated April 20, 2012, between Park National Corporation and 56 accredited investors (incorporated herein by reference to Exhibit 4.1 to Park National Corporation's Current Report on Form 8-K dated and filed on April 20, 2012 (File No. 1-13006) (“Park's April 20, 2012 Form 8-K”))

4.7 Form of 7% Subordinated Note due April 20, 2022 (incorporated herein by reference to Exhibit 4.2 to Park's April 20, 2012 Form 8-K)

4.8 Agreement to furnish instruments and agreements defining rights of holders of long-term debt (filed herewith)

10.1† Summary of Base Salaries for Executive Officers of Park National Corporation (filed herewith)

10.2† Amended and Restated Split-Dollar Agreement, made and entered into effective as of June 15, 2015, between The Park National Bank and David L. Trautman (incorporated by reference to Exhibit 10.2(a) to Park National Corporation's Current Report on Form 8-K dated and filed June 19, 2015 (File No. 1-13006) ("Park's June 19, 2015 Form 8-K"))

10.3† Split-Dollar Agreement, made and entered into effective as of June 15, 2015, between The Park National Bank and Brady T. Burt (incorporated herein by reference to Exhibit 10.3 to Park's June 19, 2015 Form 8-K)

10.4† Amended and Restated Split-Dollar Agreement, made and entered into effective as of June 15, 2015, between The Park National Bank and C. Daniel DeLawder (incorporated by reference to Exhibit 10.2(b) to Park's June 19, 2015 Form 8-K)

10.5† Amended and Restated Split-Dollar Agreement, made and entered into effective as of June 15, 2015, between The Park National Bank and David L. Trautman (incorporated herein by reference to Exhibit 10.5 to Park National Corporation's Annual Report on Form 10-K for the fiscal year ended December 31, 2015 (File No.1-13006) ("Park's 2015 Form 10-K"))

10.6† Amended and Restated Split-Dollar Agreement, made and entered into effective as of June 15, 2015, between The Park National Bank and Brady T. Burt (incorporated by reference to Exhibit 10.4 to Park's June 19, 2015 Form 8-K)

10.7† Amended and Restated Split-Dollar Agreement, made and entered into effective as of June 15, 2015, between The Park National Bank and C. Daniel Delawder (incorporated herein by reference to Exhibit 10.7 to Park's 2015 Form 10-K)

10.8† Supplemental Executive Retirement Benefits Agreement, made as of June 15, 2015, between The Park National Bank and David L. Trautman (incorporated herein by reference to Exhibit 10.1(a) to Park's June 19, 2015 Form 8-K)

10.9† Supplemental Executive Retirement Benefits Agreement, made as of June 15, 2015, between The Park National Bank and Brady T. Burt (incorporated herein by reference to Exhibit 10.1(b) to Park's June 19, 2015 Form 8-K)

10.10† Supplemental Executive Retirement Benefits Agreement, made as of June 15, 2015, between The Park National Bank and C. Daniel DeLawder (incorporated herein by reference to Exhibit 10.1(c) to Park's June 19, 2015 Form 8-K)

10.11† Supplemental Executive Retirement Benefits Agreement, made as of February 18, 2008, between The Park National Corporation and David L. Trautman (incorporated herein by reference to Exhibit 10.1 to Park National Corporation's Current Report on Form 8-K dated and filed February 19, 2008 (File No. 1-13006)("Park's February 19, 2008 Form 8-K"))

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10.12† Form of Amended and Restated Supplemental Executive Retirement Benefits Agreement, made as of February 18, 2008, between Park National Corporation and C. Daniel DeLawder (incorporated herein by reference to Exhibit 10.2 to Park's February 19, 2008 Form 8-K)

10.13† Summary of Certain Compensation for Directors of Park National Corporation (filed herewith)

10.14(a)† Form of Split-Dollar Agreement, made and entered into effective as of December 28, 2007, covering Non-Employee Directors of Park National Corporation (incorporated herein by reference to Exhibit 10.2(a) to Park National Corporation's Current Report on Form 8-K dated and filed on January 2, 2008 (File No. 1-13006))

10.14(b)† Schedule identifying Non-Employee Directors of Park National Corporation covered by form of Split-Dollar Agreement, made and entered into effective as of December 28, 2007 (filed herewith)

10.15† Park National Corporation 2013 Long-Term Incentive Plan (incorporated herein by reference to Exhibit 10.1 to Park National Corporation’s Current Report on Form 8-K dated and filed on April 23, 2013 (File No. 1-13006))

10.16† Form of Park National Corporation 2013 Long-Term Incentive Plan Performance-Based Restricted Stock Unit Award Agreement used to evidence awards of Performance-Based Restricted Stock Units to employees of Park National Corporation and of its subsidiaries granted on and after January 24, 2014 and prior to December 5, 2016 (incorporated herein by reference to Exhibit 10.1 to Park National Corporation’s Current Report on Form 8-K dated and filed on January 27, 2014 (File No. 1-13006))

10.17† Form of Park National Corporation 2013 Long-Term Incentive Plan Performance-Based Restricted Stock Unit Award Agreement used and to be used to evidence awards of Performance-Based Restricted Stock Units to employees of Park National Corporation and of its subsidiaries granted on and after December 5, 2016 (incorporated herein by reference to Exhibit 10.1 to Park National Corporation's Current Report on Form 8-K dated and filed on December 8, 2016 (File No. 1-13006))

10.18 Credit Agreement, dated as of May 18, 2016, by and between Park National Corporation and U.S. Bank National Association (incorporated herein by reference to Exhibit 10.1 to Park National Corporation's Current Report on Form 8-K dated and filed May 23, 2016 (File No. 1-13006) ("Park's May 23, 2016 Form 8-K"))

10.19 Note issued by Park National Corporation on May 18, 2016 to U.S. Bank National Association (incorporated herein by reference to Exhibit 10.2 to Park's May 23, 2016 Form 8-K)

13 2016 Annual Report (not deemed filed except for portions thereof which are specifically incorporated by reference in this Annual Report on Form 10-K) (specified portions filed herewith)

14 Code of Business Conduct and Ethics, as amended April 25, 2016 (filed herewith)

21 Subsidiaries of Park National Corporation (filed herewith)

23 Consent of Crowe Horwath LLP (filed herewith)

24 Powers of Attorney of Directors and Executive Officers of Park National Corporation (filed herewith)

31.1 Rule 13a-14(a)/15d-14(a) Certifications - Principal Executive Officer (filed herewith)

31.2 Rule 13a-14(a)/15d-14(a) Certifications - Principal Financial Officer (filed herewith)

32 Certifications Pursuant to Section 1350 of Chapter 63 of Title 18 of the United States Code - Principal Executive Officer and Principal Financial Officer (furnished herewith)

-38-

101 The following materials from Park National Corporation's 2016 Annual Report and incorporated therefrom into Park National Corporation's Annual Report on Form 10-K for the fiscal year ended December 31, 2016, formatted in XBRL (eXtensible Business Reporting Language) pursuant to Rule 405 of Regulation S-T: (i) the Consolidated Balance Sheets as of December 31, 2016 and 2015; (ii) the Consolidated Statements of Income for the years ended December 31, 2016, 2015 and 2014; (iii) the Consolidated Statements of Comprehensive Income for the years ended December 31, 2016, 2015 and 2014; (iv) the Consolidated Statements of Changes in Shareholders' Equity for the years ended December 31, 2016, 2015 and 2014; (v) the Consolidated Statements of Cash Flows for the years ended December 31, 2016, 2015 and 2014; and (vi) the Notes to Consolidated Financial Statements (electronically submitted herewith)

___________________

† Management contract or compensatory plan or arrangement.

-39-

EX-4.8

Exhibit 4.8

PARK NATIONAL CORPORATION

50 North Third Street

Post Office Box 3500

Newark, Ohio 43058-3500

(740) 349-8451

www.parknationalcorp.com

February 21, 2017

United States Securities and Exchange Commission

100 F Street, NE

Washington, D.C. 20549

Re:     Park National Corporation

Commission File Number: 1-13006

Annual Report on Form 10-K for the Fiscal Year

Ended December 31, 2016

Ladies and Gentlemen:

Park National Corporation, an Ohio corporation (“Park”), is today filing with the Securities and Exchange Commission (the “SEC”) the Annual Report on Form 10-K of Park for the fiscal year ended December 31, 2016 (“Park's 2016 Form 10-K”).

Neither (i) Park nor (ii) any of Park's consolidated subsidiaries has outstanding any instrument or agreement with respect to its long-term debt under which the total amount of long-term debt authorized exceeds 10% of the total assets of Park and Park's subsidiaries on a consolidated basis. In accordance with the provisions of Item 601(b)(4)(iii) of SEC Regulation S-K, Park hereby agrees to furnish to the SEC, upon request, a copy of each instrument or agreement defining (i) the rights of holders of long-term debt of Park or (ii) the rights of holders of long-term debt of a consolidated subsidiary of Park, in each case which is not being filed or incorporated by reference as an exhibit to Park's 2016 Form 10-K.

Very truly yours,

PARK NATIONAL CORPORATION

/s/ Brady T. Burt

Brady T. Burt

Chief Financial Officer, Secretary and Treasurer

EX-10.1

Exhibit 10.1

Summary of Base Salaries

for

Executive Officers of Park National Corporation

On December 5, 2016, the Compensation Committee of the Board of Directors of Park National Corporation (“Park”) approved the base salaries for the fiscal year ending December 31, 2017, for each of the executive officers of Park: (a) David L. Trautman, Chief Executive Officer and President of each of Park and The Park National Bank; (b) C. Daniel DeLawder, Chairman of the Board of Park and Chairman of the Board and full-time executive employee of The Park National Bank, a subsidiary of Park; and (c) Brady T. Burt, Chief Financial Officer, Secretary and Treasurer of Park and Senior Vice President and Chief Financial Officer of The Park National Bank. Those base salaries are:

* David L. Trautman -- $785,000

* C. Daniel DeLawder -- $575,000

* Brady T. Burt -- $350,000

EX-10.13

Exhibit 10.13

Summary of Certain Compensation for

Directors of Park National Corporation

Annual Retainers and Meeting Fees

Annual Retainers Payable in Common Shares

Each director of Park National Corporation (“Park”) who is not an employee of Park or one of Park’s subsidiaries (a “non-employee director”) receives, on the date of the regular meeting of the Park Board of Directors held during the fourth fiscal quarter, an annual retainer in the form of common shares awarded under the Park National Corporation 2013 Long-Term Incentive Plan. The number of common shares awarded as the annual retainer for the fiscal year ended December 31, 2016 (the “2016 fiscal year”) was 200 common shares. These common shares were delivered on the date of the regular meeting of the Park Board of Directors held October 24, 2016.

Each non-employee director of Park also serves on either the board of directors of The Park National Bank (“Park National Bank”) or the advisory board of one of the divisions of Park National Bank, and receives, on the date of the regular meeting of the Park Board of Directors held during the fourth fiscal quarter, an annual retainer in the form of: (a) 150 common shares for members of the board of directors of Park National Bank; and (b) 100 common shares for members of the advisory board of a division of Park National Bank. These common shares were also delivered on October 24, 2016.

Cash Compensation

The following table sets forth the cash compensation paid by Park to Park’s non-employee directors for the 2016 fiscal year.

Meeting Fees:
Each meeting of Board of Directors attended (1)		$1,200
Each meeting of Executive Committee attended		$900
Each meeting of Audit Committee attended		$900
Each meeting of each other Board Committee attended		$600
Annual Retainers:
Annual Retainer for Committee Chairs:
	Audit Committee	$7,500
	Nominating and Corporate Governance Committee	$5,000
	Compensation Committee	$5,000
	Risk Committee	$5,000
Annual Retainer for Other Committee Members:
	Executive Committee	$5,000
	Audit Committee	$5,000
	Risk Committee	$2,500
	Compensation Committee	$2,500
	Investment Committee	$2,500
	Nominating and Corporate Governance Committee	$2,500
Lead Director Additional Annual Retainer		$15,000

_________________________

(1)    If the date of a meeting of the full Board of Directors is changed from that provided for by resolution of the Board and a Park non-employee director is not able to attend the rescheduled meeting, he or she receives the meeting fee as though he or she attended the meeting.

Each non-employee of Park also serves on either the board of directors of Park National Bank or the advisory board of one of the divisions of Park National Bank and, in some cases, receives a specified amount of cash for such service as well as fees for attendance at meetings of the board of directors of Park National Bank or the advisory board of the applicable division of Park National Bank (and committees of the respective boards).

In addition to the annual retainers and meeting fees discussed above, non-employee directors also receive reimbursement of all reasonable travel and other expenses of attending board and committee meetings.

David L. Trautman and C. Daniel DeLawder receive no compensation for: (i) serving as a member of the Board of Directors of Park; (ii) serving as a member of the board of directors of Park National Bank; or (iii) serving as a member of any committee of the respective boards.

EX-10.14(B)

Exhibit 10.14(b)

Schedule identifying Non-Employee Directors

of Park National Corporation covered by form

of Split-Dollar Agreement,  made and

  entered into effective as of December 28, 2007  

The following directors of Park National Corporation (“Park”) are covered by Split-Dollar Agreements (the “Split-Dollar Agreements”) as identified below, which Split-Dollar Agreements are identical to the form of Split-Dollar Agreement, made and entered into effective as of December 28, 2007, filed as Exhibit 10.2(a) to Park’s Current Report on Form 8-K dated and filed on January 2, 2008 (File No. 1-13006):

Name of Director	Subsidiary of Park which is a Party to Split-Dollar Agreement	Date of Split- Dollar Agreement
Donna M. Alvarado	The Park National Bank	December 28, 2007
F. William Englefield IV	The Park National Bank	December 28, 2007
Robert E. O’Neill	The Park National Bank	December 28, 2007
Rick R. Taylor	The Park National Bank (as successor by merger to The Richland Trust Company)	December 28, 2007
Leon Zazworsky	The Park National Bank	December 28, 2007

EX-13

Exhibit 13

MANAGEMENT'S DISCUSSION AND ANALYSIS

Management's discussion and analysis addresses the financial condition and results of operations for Park National Corporation and our subsidiaries (unless the context otherwise requires, collectively, "Park" or the "Corporation").  This discussion should be read in conjunction with the consolidated financial statements and related notes and the five-year summary of selected financial data.  Management’s discussion and analysis contains forward-looking statements that are provided to assist in the understanding of anticipated future financial performance. Forward-looking statements provide current expectations or forecasts of future events and are not guarantees of future performance.  The forward-looking statements are based on management’s expectations and are subject to a number of risks and uncertainties.  Although management believes that the expectations reflected in such forward-looking statements are reasonable, actual results may differ materially from those expressed or implied in such statements.  Risks and uncertainties that could cause actual results to differ materially include, without limitation: Park's ability to execute our business plan successfully and within the expected timeframe; general economic and financial market conditions, specifically in the real estate markets and the credit markets, either nationally or in the states in which Park and our subsidiaries do business, may experience a slowing or reversal of the recent economic expansion in addition to continuing residual effects of recessionary conditions and an uneven spread of positive impacts of recovery on the economy and our counterparties, including adverse impacts on the demand for loan, deposit and other financial services, delinquencies, defaults and counterparties' ability to meet credit and other obligations; changes in interest rates and prices may adversely impact the value of securities, loans, deposits and other financial instruments and the interest rate sensitivity of our consolidated balance sheet as well as reduce interest margins and impact loan demand; changes in consumer spending, borrowing and saving habits, whether due to changing business and economic conditions, legislative and regulatory initiatives, or other factors; changes in unemployment; changes in customers', suppliers', and other counterparties' performance and creditworthiness; asset/liability repricing risks and liquidity risks; our liquidity requirements could be adversely affected by changes to regulations governing bank and bank holding company capital and liquidity standards as well as by changes in our assets and liabilities; competitive factors among financial services organizations could increase significantly, including product and pricing pressures, changes to third-party relationships and our ability to attract, develop and retain qualified bank professionals; clients could pursue alternatives to bank deposits, causing us to lose a relatively inexpensive source of funding; uncertainty regarding the nature, timing and effect of changes in banking regulations or other regulatory or legislative requirements affecting the respective businesses of Park and our subsidiaries, including major reform of the regulatory oversight structure of the financial services industry and changes in laws and regulations concerning taxes, pensions, bankruptcy, consumer protection, accounting, bank products and services, fiduciary standards, securities and other aspects of the financial services industry, specifically the reforms provided for in the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (the “Dodd-Frank Act”) and the Basel III regulatory capital reforms, as well as regulations already adopted and which may be adopted in the future by the relevant regulatory agencies, including the Consumer Financial Protection Bureau, the OCC, the FDIC, and the Federal Reserve Board, to implement the Dodd-Frank Act's provisions, the Budget Control Act of 2011, the American Taxpayer Relief Act of 2012, the JOBS Act, the FAST Act and the Basel III regulatory capital reforms; the effect of changes in accounting policies and practices, as may be adopted by the Financial Accounting Standards Board, the SEC, the Public Company Accounting Oversight Board and other regulatory agencies, and the accuracy of our assumptions and estimates used to prepare our financial statements; the effect of trade, monetary, fiscal and other governmental policies of the U.S. federal government, including money supply and interest rate policies of the Federal Reserve Board; disruption in the liquidity and other functioning of U.S. financial markets; the impact on financial markets and the economy of any changes in the credit ratings of the U.S. Treasury obligations and other U.S. government-backed debt, as well as issues surrounding the levels of U.S., European and Asian government debt and concerns regarding the creditworthiness of certain sovereign governments, supranationals and financial institutions in Europe and Asia; the uncertainty surrounding the United Kingdom's exit from the European Union and its consequences; our litigation and regulatory compliance exposure, including any adverse developments in legal proceedings or other claims and unfavorable resolution of regulatory and other governmental examinations or other inquiries; the adequacy of our risk management program; the ability to secure confidential information and deliver products and services through the use of computer systems and telecommunications networks; a failure in or breach of our operational or security systems or infrastructure, or those of our third-party vendors and other service providers, including as a result of cyber attacks; fraud, scams and schemes of third parties; the impact of widespread natural and other disasters, pandemics, dislocations, terrorist activities or international hostilities on the economy and financial markets generally or on us or our counterparties specifically; demand for loans in the respective market areas served by Park and our subsidiaries; and other risk factors relating to the banking industry as detailed from time to time in Park's reports filed with the SEC including those described in "Item 1A. Risk Factors" of Part I of Park's Annual Report on Form 10-K for the fiscal year ended December 31, 2016. Park does not undertake, and specifically disclaims any obligation, to publicly release the results of any revisions that may be made to update any forward-looking statement to reflect the events or circumstances after the date on which the forward-looking statement was made, or reflect the occurrence of unanticipated events, except to the extent required by law.

1

OVERVIEW

Financial Results by segment

The table below reflects the net income (loss) by segment for the fiscal years ended December 31, 2016, 2015, and 2014. Park's segments include The Park National Bank ("PNB"), Guardian Financial Services Company (“GFSC”), SE Property Holdings, LLC ("SEPH") and all other which primarily consists of Park as the "Parent Company."

Table 1
Net income (loss) by segment
(In thousands)	2016			2015			2014
PNB	$	84,451		$	84,345		$	82,907
GFSC	(307		)	1,423			1,175
Parent Company	(4,557		)	(4,549		)	(5,050		)
Ongoing operations	$	79,587		$	81,219		$	79,032
SEPH	6,548			(207		)	4,925
Total Park	$	86,135		$	81,012		$	83,957

The category “Parent Company” above excludes the results for SEPH, an entity which is winding down commensurate with the disposition of its problem assets. Management considers the “Ongoing operations” results, which exclude the results of SEPH, to reflect the business of Park and our subsidiaries going forward. The following discussion below provides additional information regarding the segments that make up the “Ongoing operations”, followed by additional information regarding SEPH.

The Park National Bank (PNB)

The table below reflects PNB's net income for the fiscal years ended December 31, 2016, 2015, and 2014.

Table 2
(In thousands)	2016		2015		2014
Net interest income	$	227,576	$	220,879	$	218,641
Provision for loan losses	2,611		7,665		3,517
Other income	74,803		75,188		69,384
Other expense	177,562		167,476		163,641
Income before income taxes	$	122,206	$	120,926	$	120,867
Federal income taxes	37,755		36,581		37,960
Net income	$	84,451	$	84,345	$	82,907

Net interest income of $227.6 million for the fiscal year ended December 31, 2016 represented a $6.7 million, or 3.0% increase, compared to $220.9 million for the fiscal year ended December 31, 2015. The increase was the result of a $7.4 million increase in interest income offset by a $697,000 increase in interest expense.

The $7.4 million increase in interest income was due to a $10.3 million increase in interest income on loans, offset by a $2.9 million decrease in interest income on investments. The increase in interest income on loans was largely the result of a $216 million, or 4.4%, increase in average loans from $4.9 billion for the fiscal year ended December 31, 2015, to $5.1 billion for the fiscal year ended December 31, 2016. Included in interest income for the fiscal year ended December 31, 2016 was $801,000 in income related to PNB participations in legacy Vision Bank (“Vision”) assets, compared to $241,000 for the fiscal year ended December 31, 2015.

The $697,000 increase in interest expense was due to a $1.1 million increase in interest expense on deposits, offset by a $393,000 decrease in interest expense on borrowings.

The provision for loan losses of $2.6 million for the fiscal year ended December 31, 2016 represented an improvement of $5.1 million, compared to a provision of loan losses of $7.7 million for the fiscal year ended December 31, 2015. Refer to the

2

“CREDIT EXPERIENCE: (Recovery of) Provision for Loan Losses” section for additional details regarding the level of the (recovery of) provision for loan losses recognized in each period presented above.

Other expense of $177.6 million for the fiscal year ended December 31, 2016 represented an increase of $10.1 million, or 6.0%, compared to $167.5 million for the fiscal year ended December 31, 2015. The $10.1 million increase was primarily related to a $5.6 million borrowing prepayment penalty in 2016 compared to $532,000 in 2015, a $2.0 million increase in furniture and equipment expense, a $2.0 million increase in contribution expense, a $1.7 million increase in professional fees and services, and a $1.0 million increase in non-loan related losses. Increases were offset by a decrease of $2.1 million related to employee benefits expense, largely related to a decline in medical expenses.

PNB's results for the fiscal years ended December 31, 2016, 2015, and 2014, included income and expense related to participations in legacy Vision assets. The impact of these participations on particular items within PNB's income and expense for these periods is detailed in the table below:

Table 3
	2016							2015							2014
(In thousands)	PNB as reported		Adjustments (1)			PNB as adjusted		PNB as reported		Adjustments (1)			PNB as adjusted		PNB as reported		Adjustments (1)			PNB as adjusted
Net interest income	$	227,576	$	801		$	226,775	$	220,879	$	241		$	220,638	$	218,641	$	309		$	218,332
Provision for (recovery of) loan losses	2,611		(3,118		)	5,729		7,665		(1,453		)	9,118		3,517		(6,198		)	9,715
Other income	74,803		194			74,609		75,188		1,225			73,963		69,384		1,256			68,128
Other expense	177,562		662			176,900		167,476		700			166,776		163,641		2,032			161,609
Income before income taxes	$	122,206	$	3,451		$	118,755	$	120,926	$	2,219		$	118,707	$	120,867	$	5,731		$	115,136
Federal income taxes	37,755		1,066			36,689		36,581		671			35,910		37,960		1,800			36,160
Net income	$	84,451	$	2,385		$	82,066	$	84,345	$	1,548		$	82,797	$	82,907	3,931			$	78,976

(1) Adjustments consist of the impact on the particular items reported in PNB's income statement of PNB participations in legacy Vision assets.

The table below provides certain balance sheet information and financial ratios for PNB as of December 31, 2016 and 2015.

Table 4
(In thousands)	December 31, 2016			December 31, 2015			% change from 12/31/15
Loans	$	5,234,828		$	5,029,072		4.09	%
Allowance for loan losses	48,782			54,453			(10.41	)%
Net loans	5,186,046			4,974,619			4.25	%
Investment securities	1,573,320			1,641,539			(4.16	)%
Total assets	7,389,538			7,229,764			2.21	%
Average assets (1)	7,337,438			7,219,898			1.63	%
Efficiency ratio	58.26		%	56.40		%	3.30	%
Return on average assets	1.15		%	1.17		%	(1.71	)%

(1) Average assets for the fiscal years ended December 31, 2016 and 2015, respectively.

Loans outstanding at December 31, 2016 were $5.23 billion, compared to $5.03 billion at December 31, 2015, an increase of $206 million for the fiscal year ended December 31, 2016, or 4.1%. The loan growth in 2016 consisted of commercial loan growth of $82.2 million (3.2%), consumer loan growth of $152.5 million (15.6%), and HELOC loan growth of $1.1 million (0.5%), offset by a reduction in residential loan balances of $28.9 million (2.3%).

PNB's allowance for loan losses decreased by $5.7 million, or 10.4%, to $48.8 million at December 31, 2016, compared to $54.5 million at December 31, 2015. The decrease was the result of a $3.7 million decrease in specific reserves and a $2.0 million decrease in general reserves. Net charge-offs were $8.3 million, or 0.16% of total average loans, for the fiscal year ended December 31, 2016. During the fourth quarter of 2016, PNB charged off $3.1 million in specific reserves for which provision expense had already been recognized. Refer to the “CREDIT EXPERIENCE: (Recovery of) Provision for Loan Losses” section for additional information regarding PNB's loan portfolio and the level of (recovery of) provision for loan losses recognized in each period presented.

3

Guardian Financial Services Company (GFSC)

The table below reflects GFSC's net (loss) income for the fiscal years ended December 31, 2016, 2015, and 2014.

Table 5
(In thousands)	2016			2015		2014
Net interest income	$	5,874		$	6,588	$	7,457
Provision for loan losses	1,887			1,415		1,544
Other (loss) income	(1		)	2		(1		)
Other expense	4,457			2,984		4,103
(Loss) income before income taxes	$	(471	)	$	2,191	$	1,809
Federal income (benefit) taxes	(164		)	768		634
Net (loss) income	$	(307	)	$	1,423	$	1,175

The provision for loan losses of $1.9 million for the fiscal year ended December 31, 2016 represented an increase of $472,000, compared to $1.4 million for the fiscal year ended December 31, 2015. Refer to the “CREDIT EXPERIENCE: (Recovery of) Provision for Loan Losses” section for additional information regarding Guardian's loan portfolio and the level of (recovery of) provision for loan losses recognized in each period presented.

Other expense of $4.5 million for the fiscal year ended December 31, 2016 represented a $1.5 million increase, compared to $3.0 million for the fiscal year ended December 31, 2015. This increase was primarily related to the evaluation of litigation accruals.

The table below provides certain balance sheet information and financial ratios for GFSC as of December 31, 2016 and 2015.

Table 6
(In thousands)	December 31, 2016			December 31, 2015			% change from 12/31/15
Loans	$	32,661		$	35,469		(7.92	)%
Allowance for loan losses	1,842			2,041			(9.75	)%
Net loans	30,819			33,428			(7.80	)%
Total assets	32,268			35,793			(9.85	)%
Average assets (1)	33,370			37,675			(11.43	)%
Return on average assets	(0.92		)%	3.78		%	N.M.

(1) Average assets for the fiscal years ended December 31, 2016 and 2015, respectively.

N.M - Not meaningful

Park Parent Company

The table below reflects the Park Parent Company net loss for the fiscal years ended December 31, 2016, 2015, and 2014.

Table 7
(In thousands)	2016			2015			2014
Net interest (expense) income	$	(138	)	$	239		$	(2,012	)
Provision for loan losses	—			—			—
Other income	955			513			175
Other expense	9,731			9,972			8,000
Loss before income tax benefit	$	(8,914	)	$	(9,220	)	$	(9,837	)
Federal income tax benefit	(4,357		)	(4,671		)	(4,787		)
Net loss	$	(4,557	)	$	(4,549	)	$	(5,050	)

4

The net interest (expense) income for Park's parent company included, for all periods presented, interest income on loans to SEPH (paid off on December 14, 2016) and on subordinated debt investments in PNB, which were eliminated in the consolidated Park National Corporation totals. Additionally, net interest (expense) income included, for all periods presented, interest expense related to the $30.00 million of 7% Subordinated Notes due April 20, 2022 issued by Park to accredited investors on April 20, 2012. Results for the fiscal year ended December 31, 2014 included, in addition to the items previously discussed, interest expense related to the $35.25 million of 10% Subordinated Notes due December 23, 2019 issued by Park to accredited investors on December 23, 2009. Park paid off the $35.25 million outstanding principal amount of the 10% Subordinated Notes due December 23, 2019, plus accrued interest, on December 24, 2014, the earliest redemption date allowable under the related note purchase agreement dated December 23, 2009.

Other income of $955,000 for the fiscal year ended December 31, 2016 represented an increase of $442,000, or 86.2%, compared to $513,000 for the same period in 2015. This increase was due to $461,000 in income from an equity investment.

SE Property Holdings, LLC ("SEPH")

The table below reflects SEPH's net income (loss) for the fiscal years ended December 31, 2016, 2015, and 2014. SEPH holds the remaining assets and liabilities retained by Vision subsequent to the sale of the Vision business on February 16, 2012. Prior to holding the remaining Vision assets, SEPH held OREO assets that were transferred from Vision to SEPH. This segment represents a run-off portfolio of the legacy Vision assets.

Table 8
(In thousands)	2016			2015			2014
Net interest income (expense)	$	4,774		$	(74	)	$	958
Recovery of loan losses	(9,599		)	(4,090		)	(12,394		)
Other income	2,974			1,848			5,991
Other expense	7,273			6,182			11,766
Income (loss) before income taxes	$	10,074		$	(318	)	$	7,577
Federal income tax expense (benefit)	3,526			(111		)	2,652
Net income (loss)	$	6,548		$	(207	)	$	4,925

Net interest income increased to $4.8 million for the fiscal year ended December 31, 2016 from net interest expense of $74,000 for the fiscal year ended December 31, 2015. The increase was largely the result of payments received from certain SEPH impaired loan relationships.

For the fiscal year ended December 31, 2016, SEPH had net recoveries of loan losses of $9.6 million. The net recoveries during 2016 consisted of $447,000 in charge-offs offset by recoveries from loans previously charged off of $10.0 million.

The $1.1 million increase in other income for the fiscal year ended December 31, 2016, compared to the fiscal year ended December 31, 2015, was primarily the result of the recovery of fees from certain SEPH impaired loan relationships.

The $1.1 million increase in other expense for the fiscal year ended December 31, 2016, compared to the fiscal year ended December 31, 2015, was primarily the result of a $1.0 million decrease in expense related to reserves established for potential mortgage loan repurchases, offset by increases in legal fees of $390,000 and management and consulting services of $2.1 million.

In the aggregate, for the fiscal year ended December 31, 2016, SEPH realized $18.0 million in operating income items, consisting of interest income, recoveries from loans previously charged off, and other income, offset by operating expense items totaling $7.9 million, consisting of interest expense and other expense.

Legacy Vision assets at SEPH totaled $20.3 million as of December 31, 2016 compared to $26.3 million as of December 31, 2015. In addition to these SEPH assets, PNB participations in legacy Vision assets totaled $9.6 million at December 31, 2016 compared to $9.8 million at December 31, 2015.

5

Park National Corporation

The table below reflects Park's net income for the fiscal years ended December 31, 2016, 2015, and 2014.

Table 9
(In thousands)	2016			2015		2014
Net interest income	$	238,086		$	227,632	$	225,044
(Recovery of) provision for loan losses	(5,101		)	4,990		(7,333		)
Other income	78,731			77,551		75,549
Other expense	199,023			186,614		187,510
Income before income taxes	$	122,895		$	113,579	$	120,416
Federal income taxes	36,760			32,567		36,459
Net income	$	86,135		$	81,012	$	83,957

DIVIDENDS ON COMMON SHARES

Cash dividends declared on Park's common shares were $3.76 in 2016, 2015 and 2014. The quarterly cash dividend on Park's common shares was $0.94 per share for each quarter of 2016, 2015 and 2014. 

CRITICAL ACCOUNTING POLICIES

The significant accounting policies used in the development and presentation of Park’s consolidated financial statements are listed in Note 1 of the Notes to Consolidated Financial Statements.  The accounting and reporting policies of Park conform with U.S. generally accepted accounting principles ("GAAP") and general practices within the financial services industry.  The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and the accompanying notes.  Actual results could differ from those estimates.

Allowance for Loan and Lease Losses ("ALLL") - The determination of the ALLL involves a higher degree of judgment and complexity than Park's other significant accounting policies.  The ALLL is calculated with the objective of maintaining a reserve level believed by management to be sufficient to absorb probable, incurred credit losses in the loan portfolio. Management’s determination of the adequacy of the ALLL is based on periodic evaluations of the loan portfolio and of current economic conditions.  However, this evaluation is inherently subjective as it requires material estimates, including expected default probabilities, the loss given default, the amounts and timing of expected future cash flows on impaired loans, and estimated losses based on historical loss experience and current economic conditions.  All of these factors may be susceptible to significant change.  To the extent that actual results differ from management estimates, additional loan loss provisions may be required that would adversely impact earnings for future periods. 

Other Real Estate Owned ("OREO") - OREO, property acquired through foreclosure, is recorded at estimated fair value less anticipated selling costs (net realizable value). If the net realizable value is below the carrying value of the loan on the date of transfer of the OREO, the difference is charged off against the ALLL. Subsequent declines in value (OREO devaluations) are reported as adjustments to the carrying amount of OREO and are expensed within other income. Gains or losses not previously recognized, resulting from the sale of OREO, are recognized within other income on the date of sale.  At December 31, 2016, OREO totaled $13.9 million, a decrease of 25.3%, compared to $18.7 million at December 31, 2015.

Fair Value - In accordance with GAAP, management utilizes the fair value hierarchy, which has the objective of maximizing the use of observable market inputs.  The accounting guidance also requires disclosures regarding the inputs used to calculate fair value. These inputs are classified as Level 1, 2, and 3. Level 3 inputs are those with significant unobservable inputs that reflect a company’s own assumptions about the market for a particular instrument. Some of the inputs could be based on internal models and/or cash flow analyses. The large majority of Park’s financial assets valued using Level 2 inputs consist of available-for-sale (“AFS”) securities. The fair value of these AFS securities is obtained largely by the use of matrix pricing, which is a mathematical technique widely used in the financial services industry to value debt securities without relying exclusively on quoted market prices for the specific securities but rather by relying on the securities’ relationship to other benchmark quoted securities.

Goodwill - The accounting for goodwill also involves a higher degree of judgment than most other significant accounting policies. GAAP establishes standards for the impairment assessment of goodwill. Goodwill arising from business combinations represents the value attributable to unidentifiable intangible assets in the business acquired. Park’s goodwill relates to the value

6

inherent in the banking industry and that value is dependent upon the ability of PNB, Park’s national bank subsidiary, to provide quality, cost-effective banking services in a competitive marketplace. The goodwill value is supported by revenue that is in part driven by the volume of business transacted. A decrease in earnings resulting from a decline in the customer base, the inability to deliver cost-effective services over sustained periods or significant credit problems can lead to impairment of goodwill that could adversely impact earnings in future periods. Under GAAP, goodwill is no longer amortized but is subject to an annual evaluation for impairment, or more frequently if events or changes in circumstances indicate that the asset might be impaired, by assessing qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If after assessing these events or circumstances, it is concluded that it is more likely than not that the fair value of a reporting unit is less than its carrying amount, then the performance of the second step of the impairment test is required. If the carrying amount of the goodwill exceeds the fair value, an impairment charge must be recorded in an amount equal to the excess. At December 31, 2016, on a consolidated basis, Park had $72.3 million of goodwill, all of which is recorded at PNB.

Pension Plan - The determination of pension plan obligations and related expenses requires the use of assumptions to estimate the amount of benefits that employees earn while working, as well as the present value of those benefits. Annual pension expense is principally based on four components: (1) the value of benefits earned by employees for working during the year (service cost), (2) the increase in the liability due to the passage of time (interest cost), and (3) other gains and losses, reduced by (4) the expected return on plan assets for our pension plan.

Significant assumptions used to measure our annual pension expense include:

• the interest rate used to determine the present value of liabilities (discount rate);

• certain employee-related factors, such as turnover, retirement age and mortality;

• the expected return on assets in our funded plans; and

• the rate of salary increases

Our assumptions reflect our historical experience and management’s best judgment regarding future expectations. Due to the significant management judgment involved, our assumptions could have a material impact on the measurement of our pension plan expense and obligation.

ABOUT OUR BUSINESS

Through our Ohio-based banking divisions, Park is engaged in the commercial banking and trust business, generally in small to medium population Ohio communities. Management believes there are a significant number of consumers and businesses which seek long-term relationships with community-based financial institutions of quality and strength.  While not engaging in activities such as foreign lending, nationally syndicated loans or investment banking, Park attempts to meet the needs of our customers for commercial, real estate and consumer loans, and investment, fiduciary and deposit services.

Park’s subsidiaries compete for deposits and loans with other banks, savings associations, credit unions and other types of financial institutions.  At December 31, 2016, Park operated 117 financial service offices (including those of PNB, Scope Leasing, Inc. ("Scope Aircraft Finance"), and GFSC) and a network of 138 automated teller machines in 29 Ohio counties. Park also operated one office for SEPH, located in Newark, Ohio.

A summary of average loans and average deposits for Park’s subsidiaries, including its bank subsidiary, PNB, and PNB's divisions and subsidiary Scope Aircraft Finance for 2016, 2015 and 2014 is shown in Table 10.  See Note 27 of the Notes to Consolidated Financial Statements for additional financial information for the Corporation’s operating segments.  Please note that the financial statements for the divisions of PNB are not prepared on a separate basis and, therefore, net income is not included in the summary financial data in table 10.

7

Table 10  -  Park Affiliate Financial Data
	2016					2015					2014
(In thousands)	Average Loans			Average Deposits		Average Loans			Average Deposits		Average Loans			Average Deposits
Park National Bank:
Park National Bank Division	$	1,623,565		$	1,526,438	$	1,465,586		$	1,473,906	$	1,383,686		$	1,426,645
Security National Bank Division	459,172			798,809		462,681			802,061		454,680			774,716
First-Knox National Bank Division	591,807			638,338		591,948			632,810		571,519			563,275
Century National Bank Division	649,645			574,171		655,682			556,543		638,314			493,449
Richland Bank Division	231,884			501,678		240,622			483,673		242,788			451,304
Fairfield National Bank Division	269,805			399,174		260,281			406,940		255,280			401,255
Second National Bank Division	382,555			356,913		374,385			337,181		355,379			317,208
Park National SW & N KY Bank Division	421,873			219,603		384,788			210,066		363,735			208,784
United Bank, N.A. Division	109,727			203,613		103,301			198,162		92,427			190,082
Unity National Bank Division	183,985			187,088		180,034			172,658		174,950			162,074
Farmers Bank Division	131,501			99,446		123,875			96,782		108,397			89,328
Scope Aircraft Finance	238,464			1,471		198,475			465		178,194			8
SEPH	14,434			—		17,910			—		31,836			—
GFSC	33,370			4,174		37,686			5,595		43,165			6,610
Parent Company, other	(218,925		)	69,888		(187,675		)	89,982		(177,053		)	(67,185		)
Consolidated Totals	$	5,122,862		$	5,580,804	$	4,909,579		$	5,466,824	$	4,717,297		$	5,017,553

SOURCE OF FUNDS

Deposits: Park’s major source of funds is deposits from individuals, businesses and local government entities.  These deposits consist of non-interest bearing and interest bearing deposits.

Average total deposits were $5,581 million in 2016, compared to $5,467 million in 2015 and $5,018 million in 2014. Table 11 provides a summary of deposit balances as of December 31, 2016 and 2015, along with the change over the past year.

Table 11 - Year-End Deposits
December 31,
(In thousands)	2016		2015		Change
Non-interest bearing checking	$	1,523,417	$	1,404,032	$	119,385
Interest bearing transaction accounts	1,174,448		1,107,200		67,248
Savings	1,704,920		1,544,708		160,212
All other time deposits	1,117,870		1,290,412		(172,542		)
Other	1,301		1,290		11
Total	$	5,521,956	$	5,347,642	$	174,314

The average interest rate paid on interest bearing deposits was 0.32% in 2016, compared to 0.30% in 2015, and 0.29% in 2014.  The average cost of interest bearing deposits for each quarter of 2016 was 0.34% for the fourth quarter, 0.32% for the third quarter, 0.32% for the second quarter and 0.31% for the first quarter. 

8

Maturities of time deposits over $100,000 as of December 31, 2016 and 2015 were:

Table 12 - Maturities of Time Deposits	Over $100,000
December 31 (In thousands)	2016		2015
3 months or less	$	174,503	$	197,871
Over 3 months through 6 months	78,455		96,132
Over 6 months through 12 months	97,551		117,249
Over 12 months	86,589		97,242
Total	$	437,098	$	508,494

Short-Term Borrowings: Short-term borrowings consist of securities sold under agreements to repurchase, Federal Home Loan Bank advances, Federal Funds purchased and other borrowings.  These funds are used to manage the Corporation’s liquidity needs and interest rate sensitivity risk.  The average rate paid on short-term borrowings generally moves closely with changes in market interest rates for short-term investments.  The average rate paid on short-term borrowings was 0.19% in 2016, compared to 0.18% in 2015, and 0.20% in 2014. The year-end balance for short-term borrowings was $395 million at December 31, 2016, compared to $394 million at December 31, 2015, and $277 million at December 31, 2014. 

Long-Term Debt: Long-term debt primarily consists of borrowings from the Federal Home Loan Bank and repurchase agreements with investment banking firms.  The average balance of long-term debt and the average cost of long-term debt include the subordinated notes discussed in the following section.  In 2016, average long-term debt was $776 million, compared to $793 million in 2015, and $868 million in 2014. The average interest rate paid on long-term debt was 3.13% for 2016, compared to 3.10% for 2015, and 3.29% for 2014. Average total debt (long-term and short-term) was $1,017 million in 2016, compared to $1,052 million in 2015, and $1,131 million in 2014.  Average total debt decreased by $35 million or 3.3% in 2016 compared to 2015, and decreased by $79 million or 7.0% in 2015 compared to 2014. Average long-term debt was 76% of average total debt in 2016, compared to 75% of average total debt in 2015, and 77% of average total debt in 2014.

Subordinated Notes: Park assumed, with the 2007 acquisition of Vision's parent holding company, $15.5 million of floating rate junior subordinated notes.  The $15.5 million of junior subordinated notes were purchased by Vision Bancshares Trust I ("Trust I") following the issuance of Trust I's $15.0 million of floating rate preferred securities. The interest rate on these junior subordinated notes adjusts every quarter at 148 basis points above the three-month LIBOR interest rate.  The maturity date for the junior subordinated notes is December 30, 2035 and the junior subordinated notes may be prepaid after December 30, 2010.  These junior subordinated notes qualify as Tier 1 capital under current Federal Reserve Board guidelines.

On December 23, 2009, Park issued an aggregate principal amount of $35.25 million of subordinated notes to 38 purchasers.  These subordinated notes had a fixed annual interest rate of 10% with quarterly interest payments.  The maturity date of these subordinated notes was December 23, 2019 and the subordinated notes were eligible to be prepaid after December 23, 2014.  The subordinated notes qualifed as Tier 2 capital under applicable Federal Reserve Board guidelines.  Each subordinated note was purchased at a purchase price of 100% of the principal amount by an accredited investor. Park paid in full the $35.25 million outstanding principal amount, plus accrued interest, on December 24, 2014, the earliest redemption date allowable under the related note purchase agreement.

On April 20, 2012, Park issued an aggregate principal amount of $30.0 million of subordinated notes to 56 purchasers.  These subordinated notes have a fixed annual interest rate of 7% with quarterly interest payments. The maturity date of these subordinated notes is April 20, 2022 and the subordinated notes are eligible to be prepaid after April 20, 2017. The subordinated notes qualify as Tier 2 capital under applicable Federal Reserve Board guidelines. Each subordinated note was purchased at a purchase price of 100% of the principal amount by an accredited investor.

See Note 15 of the Notes to Consolidated Financial Statements for additional information about the subordinated notes.

Shareholders' Equity: The ratio of total shareholders' equity to total assets was 9.94% at December 31, 2016, compared to 9.76% at December 31, 2015 and 9.95% at December 31, 2014. The ratio of tangible shareholders’ equity [shareholders’ equity ($742.2 million) less goodwill ($72.3 million)] to tangible assets [total assets ($7,468 million) less goodwill ($72.3 million)] was 9.06% at December 31, 2016, compared to 8.86% at December 31, 2015, and 9.04% at December 31, 2014.

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In accordance with GAAP, Park reflects any unrealized holding gain or loss on AFS securities or change in the funded status of Park's pension plan, net of income taxes, as accumulated other comprehensive income (loss) which is part of Park’s shareholders’ equity.  

The unrealized net holding loss, net of income taxes, on AFS securities was $3.0 million at year-end 2016, compared to the unrealized net holding loss, net of income taxes, of $292,000 at year-end 2015, and compared to the unrealized net holding gain, net of income taxes, of $1.3 million at year-end 2014.

In accordance with GAAP, Park adjusts accumulated other comprehensive income (loss) to recognize the net actuarial gain or loss reflected in the funding status of Park’s pension plan.  See Note 18 of the Notes to Consolidated Financial Statements for information on the accounting for Park’s pension plan. Pertaining to the funding status of the pension plan, Park recognized a net comprehensive gain of $0.6 million in 2016, a net comprehensive loss of $0.5 million in 2015, and a net comprehensive loss of $9.3 million in 2014. The net comprehensive gain in 2016 was due to changes in actuarial assumptions combined with increased investment returns on pension plan assets. The net comprehensive loss in 2015 was due to changes in actuarial assumptions combined with lower investment returns on pension plan assets. The net comprehensive loss in 2014 was due to changes in actuarial assumptions, primarily a decrease in the discount rate from 5.30% at December 31, 2013 to 4.42% at December 31, 2014. The actuarial loss more than offset the positive investment returns with respect to the pension plan's assets in 2014.

At year-end 2016, the balance in accumulated other comprehensive loss pertaining to the pension plan was $(14.7) million, compared to $(15.4) million at December 31, 2015, and $(14.9) million at December 31, 2014.

INVESTMENT OF FUNDS

Loans:  Average loans were $5,123 million in 2016, compared to $4,910 million in 2015, and $4,717 million in 2014.  The actual yield on average loan balances was 4.74% in 2016, compared to 4.66% in 2015, and 4.84% in 2014. Approximately 50% of Park’s loan balances mature or reprice within one year (see Table 35).  The actual yield on average loan balances for each quarter of 2016 was 4.87% for the fourth quarter, 4.66% for the third quarter, 4.64% for the second quarter and 4.80% for the first quarter.  

Loan interest income for 2016 included $5.1 million related to payments received on certain SEPH impaired loan relationships, some of which are participated with PNB. Excluding this income, the actual yield on average loan balances was 4.64% for the year ended December 31, 2016 and 4.62% for the fourth quarter, 4.66% for the third quarter, 4.64% for the second quarter and 4.67% for the first quarter.

At December 31, 2016, loan balances were $5,272 million, compared to $5,068 million at year-end 2015, an increase of $204 million or 4.0%. The loan growth of $204 million in 2016 was largely due to increases in loans of $206 million at PNB, offset by declines at GFSC and SEPH.

Table 13 reports year-end loan balances by type of loan for the past five years.

Table 13  -  Loans by Type
December 31,
(In thousands)	2016		2015		2014		2013		2012
Commercial, financial and agricultural	$	994,619	$	955,727	$	856,535	$	825,432	$	823,927
Construction real estate	188,945		173,345		155,804		156,116		165,528
Residential real estate	1,808,497		1,855,443		1,851,375		1,799,547		1,713,645
Commercial real estate	1,155,703		1,113,603		1,069,637		1,112,273		1,092,164
Consumer	1,120,850		967,111		893,160		723,733		651,930
Leases	3,243		2,856		3,171		3,404		3,128
Total Loans	$	5,271,857	$	5,068,085	$	4,829,682	$	4,620,505	$	4,450,322

Loan growth was experienced within the commercial, financial and agricultural, construction real estate, commercial real estate, and consumer loan types in 2016.

10

On a combined basis, year-end commercial, financial and agricultural loans, construction real estate loans and commercial real estate loans increased by $97 million, or 4.3%, in 2016 and increased by $161 million, or 7.7%, in 2015. The increase in 2016 was due to increases in commercial real estate loans of $42.1 million, in commercial, financial and agricultural loans of $38.9 million, and in construction real estate loans of $15.6 million. The increase in 2015 was due to increases in commercial, financial and agricultural loans of $99.2 million, in commercial real estate loans of $44.0 million, and in construction real estate loans of $17.5 million.

Consumer loans increased by $154 million or 15.9% in 2016 and increased by $74 million or 8.3% in 2015. The increase in consumer loans in each of 2016 and 2015 was primarily due to an increase in automobile lending in Ohio.

The long-term, fixed-rate residential mortgage loans that Park originates are generally sold in the secondary market and Park typically retains servicing on these loans. The balance of sold, fixed-rate residential mortgage loans, in which Park has maintained the servicing rights, was $1,330 million at year-end 2016, compared to $1,276 million at year-end 2015 and $1,265 million at year-end 2014.    

Table 14 - Selected Loan Maturity Distribution
	One Year or Less (1)		Over One Through Five Years		Over  Five  Years		Total
December 31, 2016
(In thousands)
Commercial, financial and agricultural	$	102,822	$	351,183	$	540,614	$	994,619
Construction real estate	39,583		29,767		119,595		188,945
Commercial real estate	56,261		92,539		1,006,903		1,155,703
Total	$	198,666	$	473,489	$	1,667,112	$	2,339,267
Total of these selected loans due
after one year with:
Fixed interest rate			$	272,722	$	468,114	$	740,836
Floating interest rate			200,767		1,198,998		1,399,765

(1)  Nonaccrual loans of $41.1 millionare included within the one year or less classification above.

Investment Securities: Park’s investment securities portfolio is structured to minimize credit risk, provide liquidity and contribute to earnings. As conditions change over time, Park’s overall interest rate risk, liquidity needs and potential return on the investment portfolio will change.  Management regularly evaluates the securities in the investment portfolio as circumstances evolve.  Circumstances that could result in the sale of a security include: to better manage interest rate risk; to meet liquidity needs; or to improve the overall yield in the investment portfolio.

Park classifies the majority of its securities as AFS (see Note 4 of the Notes to Consolidated Financial Statements).  These securities are carried on the books at their estimated fair value with the unrealized holding gain or loss, net of federal income taxes, accounted for as accumulated other comprehensive income (loss).  The securities that are classified as AFS are free to be sold in future periods in carrying out Park’s investment strategies.

Park classifies certain types of U.S. Government sponsored entity collateralized mortgage obligations (“CMOs”) that it purchases as Held-To-Maturity ("HTM").  In addition, starting in 2015, Park began to purchase tax-exempt municipal securities, also classified as HTM. These securities are classified as HTM because they are generally not as liquid as the investment securities that Park classifies as AFS. A classification of HTM means that Park has the positive intent and the ability to hold these securities until maturity. At year-end 2016, Park’s HTM securities portfolio was $260 million, compared to $149 million at year-end 2015, and $141 million at year-end 2014. Included in the HTM securities portfolio as of December 31, 2016 were $189 million of tax-exempt municipal securities. All of the CMOs, mortgage-backed securities, and callable notes in Park’s investment portfolio were issued by U.S. Government sponsored entities.

Average taxable investment securities were $1,413 million in 2016, compared to $1,472 million in 2015, and $1,433 million in 2014.  The average yield on taxable investment securities was 2.17% in 2016, compared to 2.45% in 2015, and 2.58% in 2014.  Average tax-exempt investment securities were $91 million in 2016, compared to $6 million in 2015, and $65,000 in 2014.  The average tax-equivalent yield on tax-exempt investment securities was 4.43% in 2016, compared to 4.72% in 2015, and 6.97% in 2014.

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Total investment securities (at amortized cost) were $1,584 million at December 31, 2016, compared to $1,644 million at December 31, 2015, and $1,499 million at December 31, 2014.  Management purchased investment securities totaling $724 million in 2016, $506 million in 2015, and $352 million in 2014. Proceeds from repayments and maturities of investment securities were $783 million in 2016, $357 million in 2015, and $140 million in 2014.  

Proceeds from sales of investment securities were $3.1 million in 2015. These investment securities had a book value of $3.1 million and resulted in a gain on sale of $88,000. Proceeds from sales of investment securities were $173.1 million in 2014. Of the investment securities sold in 2014, a small portion with a book value of $187,000 was sold for a gain of $22,000. The remaining investment securities sold in 2014, with a book value of $174.1 million, were sold at a loss of $1.2 million. There were no sales of investment securities in 2016.

At year-end 2016, 2015, and 2014, the average tax-equivalent yield on the total investment portfolio was 2.30%, 2.28%, and 2.47%, respectively.  The weighted average remaining maturity of the total investment portfolio was 4.4 years at December 31, 2016, 4.8 years at December 31, 2015, and 5.2 years at December 31, 2014.  Obligations of the U.S. Treasury and other U.S. Government sponsored entities and U.S. Government sponsored entities' asset-backed securities were approximately 83.9% of the total investment portfolio at year-end 2016, approximately 93.3% of the total investment portfolio at year-end 2015, and approximately 96.0% of the total investment portfolio at year-end 2014. 

The average maturity of the investment portfolio would lengthen if long-term interest rates were to increase as principal repayments from mortgage-backed securities and CMOs would decline and callable U.S. Government sponsored entity notes would extend to their maturity dates.  At year-end 2016, management estimated that the average maturity of the investment portfolio would lengthen to 5.1 years with a 100 basis point increase in long-term interest rates and to 5.4 years with a 200 basis point increase in long-term interest rates.  Likewise, the average maturity of the investment portfolio would shorten if long-term interest rates were to decrease as the principal repayments from mortgage-backed securities and CMOs would increase as borrowers would refinance their mortgage loans and the callable U.S. Government sponsored entity notes would shorten to their call dates.  At year-end 2016, management estimated that the average maturity of the investment portfolio would decrease to 3.4 years with a 100 basis point decrease in long-term interest rates and to 2.8 years with a 200 basis point decrease in long-term interest rates.

Table 15 sets forth the carrying value of investment securities, as well as the percentage held within each category at year-end 2016, 2015 and 2014:

Table 15  -  Investment Securities
December 31,
(In thousands)	2016			2015			2014
Obligations of U.S. Treasury and other U.S. Government sponsored entities	$	267,533		$	522,063		$	538,064
Obligations of states and political subdivisions	188,622			48,190			—
U.S. Government asset-backed securities	1,058,383			1,012,605			901,715
Federal Home Loan Bank stock	50,086			50,086			50,086
Federal Reserve Bank stock	8,225			8,225			8,225
Equities	6,934			2,710			2,698
Total	$	1,579,783		$	1,643,879		$	1,500,788
Investments by category as a percentage of total investment securities
Obligations of U.S. Treasury and other U.S. Government sponsored entities	16.9		%	31.8		%	35.9		%
Obligations of states and political subdivisions	11.9		%	2.9		%	—		%
U.S. Government asset-backed securities	67.0		%	61.6		%	60.1		%
Federal Home Loan Bank stock	3.2		%	3.0		%	3.3		%
Federal Reserve Bank stock	0.5		%	0.5		%	0.5		%
Equities	0.5		%	0.2		%	0.2		%
Total	100.0		%	100.0		%	100.0		%

12

ANALYSIS OF EARNINGS

Net Interest Income: Park’s principal source of earnings is net interest income, the difference between total interest income and total interest expense.  Net interest income results from average balances outstanding for interest earning assets and interest bearing liabilities in conjunction with the average rates earned and paid on them.  (See Table 16 for three years of history on the average balances of the balance sheet categories as well as the average rates earned on interest earning assets and the average rates paid on interest bearing liabilities.)

Table 16 - Distribution of Assets, Liabilities and Shareholders' Equity
December 31,	2016							2015							2014
(In thousands)	Daily Average			Interest		Average Rate		Daily Average			Interest		Average Rate		Daily Average			Interest		Average Rate
ASSETS
Interest earning assets:
Loans (1) (2)	$	5,122,862		$	242,978	4.74	%	$	4,909,579		$	228,746	4.66	%	$	4,717,297		$	228,487	4.84	%
Taxable investment securities	1,413,324			30,627		2.17	%	1,472,285			36,026		2.45	%	1,432,627			36,981		2.58	%
Tax-exempt investment securities (3)	91,343			4,050		4.43	%	5,923			279		4.72	%	65			5		6.97	%
Money market instruments	198,197			1,020		0.51	%	342,997			888		0.26	%	204,874			515		0.25	%
Total interest earning assets	6,825,726			278,675		4.08	%	6,730,784			265,939		3.95	%	6,354,863			265,988		4.19	%
Non-interest earning assets:
Allowance for loan losses	(56,890		)					(56,947		)					(58,917		)
Cash and due from banks	115,779							117,286							112,113
Premises and equipment, net	59,104							58,377							55,407
Other assets	472,800							456,960							429,836
TOTAL	$	7,416,519						$	7,306,460						$	6,893,302
LIABILITIES AND SHAREHOLDERS' EQUITY
Interest bearing liabilities:
Transaction accounts	$	1,244,646		$	1,358	0.11	%	$	1,257,681		$	816	0.06	%	$	1,291,310		$	825	0.06	%
Savings deposits	1,705,592			2,721		0.16	%	1,544,316			1,413		0.09	%	1,216,750			852		0.07	%
Time deposits	1,215,681			9,337		0.77	%	1,353,199			10,125		0.75	%	1,312,868			9,323		0.71	%
Total interest bearing deposits	4,165,919			13,416		0.32	%	4,155,196			12,354		0.30	%	3,820,928			11,000		0.29	%
Short-term borrowings	240,457			456		0.19	%	258,717			469		0.18	%	263,270			517		0.20	%
Long-term debt (4)	776,465			24,300		3.13	%	793,469			24,619		3.10	%	867,615			28,582		3.29	%

13

Table 16 - Continued
December 31,	2016						2015						2014
(In thousands)	Daily Average		Interest		Average Rate		Daily Average		Interest		Average Rate		Daily Average		Interest		Average Rate
Total interest bearing liabilities	5,182,841		38,172		0.74	%	5,207,382		37,442		0.72	%	4,951,813		40,099		0.81	%
Non-interest bearing liabilities:
Demand deposits	1,414,885						1,311,628						1,196,625
Other	81,056						77,123						64,415
Total non-interest bearing liabilities	1,495,941						1,388,751						1,261,040
Shareholders' equity	737,737						710,327						680,449
TOTAL	$	7,416,519					$	7,306,460					$	6,893,302
Tax equivalent net interest income			$	240,503					$	228,497					$	225,889
Net interest spread					3.34	%					3.23	%					3.38	%
Net yield on interest earning assets (net interest margin)					3.52	%					3.39	%					3.55	%

(1) Loan income includes net loan related fee income and origination costs (expense) of ($1.6 million) in 2016, ($1.0 million) in 2015, and $1.3 million in 2014. Loan income also includes the effects of taxable equivalent adjustments using a 35% tax rate in 2016, 2015 and 2014.  The taxable equivalent adjustment was $1.0 million in 2016, $767,000 in 2015, and $843,000 in 2014.

(2) For the purpose of the computation for loans, nonaccrual loans are included in the daily average loans outstanding.

(3) Interest income on tax-exempt investment securities includes the effects of taxable equivalent adjustments using a 35% tax rate in 2016, 2015 and 2014. The taxable equivalent adjustments were $1.4 million in 2016, $98,000 in 2015, and $2,000 in 2014.

(4) Includes subordinated notes.

Average interest earning assets for 2016 increased by $95 million, or 1.4%, to $6,826 million, compared to $6,731 million for 2015.  Average interest earning assets of $6,731 million for 2015 represented an increase of $376 million, or 5.9%, compared to $6,355 for 2014. The average yield on interest earning assets increased by 13 basis points to 4.08% for 2016, compared to 3.95% for 2015. The average yield on interest earning assets of 3.95% for 2015 represented a decrease of 24 basis points compared to 4.19% for 2014.

Interest income for 2016 included $5.1 million related to payments received on certain SEPH impaired loan relationships, some of which are participated with PNB. Excluding this income, the yield on loans was 4.64%, the yield on interest earning assets was 4.01%, and the net interest margin was 3.45%.

Average interest bearing liabilities for 2016 decreased by $24 million, or 0.05%, to $5,183 million, compared to $5,207 million for 2015.  Average interest bearing liabilities of $5,207 million for 2015 represented an increase of $255 million, or 5.2%, compared to $4,952 million for 2014. The average cost of interest bearing liabilities increased by 2 basis points to 0.74% for 2016, compared to 0.72% for 2015. The cost of interest bearing liabilities of 0.72% for 2015 was a decrease of 9 basis points compared to 0.81% for 2014.

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The following table displays (for each quarter of 2016) the average balance of interest earning assets, the net interest income and the tax equivalent net interest income and net interest margin.

Table 17  - Quarterly Net Interest Margin
(In thousands)	Average Interest Earning Assets		Net Interest Income		Tax Equivalent Net Interest Income	Tax Equivalent Net Interest Margin
First Quarter	$	6,818,281	$	59,819	60,263	3.55	%
Second Quarter	6,800,436		57,485		58,040	3.43	%
Third Quarter	6,871,661		58,533		59,152	3.42	%
Fourth Quarter	6,812,168		62,249		63,048	3.68	%
2016	$	6,825,726	$	238,086	240,503	3.52	%

In the following table, the change in tax equivalent interest due to both volume and rate has been allocated to volume and rate changes in proportion to the relationship of the absolute dollar amounts of the change in each.

Table 18  -  Volume/Rate Variance Analysis
	Change from 2015 to 2016									Change from 2014 to 2015
(In thousands)	Volume			Rate			Total			Volume			Rate			Total
Increase (decrease) in:
Interest income:
Total loans	$	10,065		$	4,167		$	14,232		$	9,016		$	(8,757	)	$	259
Taxable investments	(1,400		)	(3,999		)	(5,399		)	982			(1,937		)	(955		)
Tax-exempt investments	3,789			(18		)	3,771			276			(2		)	274
Money market instruments	(486		)	618			132			352			21			373
Total interest income	11,968			768			12,736			10,626			(10,675		)	(49		)
Interest expense:
Transaction accounts	$	(8	)	$	550		$	542		$	(9	)	$	—		$	(9	)
Savings accounts	162			1,146			1,308			273			289			562
Time deposits	(1,051		)	263			(788		)	283			519			802
Short-term borrowings	(34		)	21			(13		)	(7		)	(41		)	(48		)
Long-term debt	(531		)	212			(319		)	(2,365		)	(1,599		)	(3,964		)
Total interest expense	(1,462		)	2,192			730			(1,825		)	(832		)	(2,657		)
Net variance	$	13,430		$	(1,424	)	$	12,006		$	12,451		$	(9,843	)	$	2,608

15

Other Income:  Other income was $78.7 million in 2016, compared to $77.6 million in 2015, and $75.5 million in 2014.

The following table displays total other income for Park in 2016, 2015 and 2014.

Table 19 - Other Income
Year Ended December 31,
(In thousands)	2016			2015			2014
Income from fiduciary activities	$	21,400		$	20,195		$	19,150
Service charges on deposits	14,259			14,751			15,423
Other service income	14,419			11,438			10,459
Checkcard fee income	15,057			14,561			13,570
Bank owned life insurance income	4,338			5,783			4,861
ATM fees	2,268			2,428			2,467
Gain on the sale of OREO, net	1,323			1,604			5,503
OREO valuation adjustments	(601		)	(1,592		)	(2,406		)
Gain on the sale of commercial loans held for sale	—			756			1,867
Gain (loss) on sale of investment securities	—			88			(1,158		)
Miscellaneous	6,268			7,539			5,813
Total other income	$	78,731		$	77,551		$	75,549

The following table breaks out the change in total other income for the year ended December 31, 2016 compared to the year ended December 31, 2015, and for the year ended December 31, 2015 compared to the year ended December 31, 2014, between Park's Ohio-based operations and SEPH.

Table 20 - Other Income Breakout
	Change from 2015 to 2016									Change from 2014 to 2015
(In thousands)	Ohio-based operations			SEPH			Total			Ohio-based operations			SEPH			Total
Income from fiduciary activities	$	1,205		$	—		$	1,205		$	1,045		$	—		$	1,045
Service charges on deposits	(492		)	—			(492		)	(672		)	—			(672		)
Other service income	1,596			1,385			2,981			2,011			(1,032		)	979
Checkcard fee income	496			—			496			991			—			991
Bank owned life insurance income	(1,445		)	—			(1,445		)	922			—			922
ATM fees	(160		)	—			(160		)	(39		)	—			(39		)
Gain on the sale of OREO, net	(764		)	483			(281		)	(1,220		)	(2,679		)	(3,899		)
OREO valuation adjustments	658			333			991			335			479			814
Gain on sale of commercial loans held for sale	(34		)	(722		)	(756		)	363			(1,474		)	(1,111		)
Gain (loss) on sale of investment securities	(88		)	—			(88		)	1,246			—			1,246
Miscellaneous	(918		)	(353		)	(1,271		)	1,163			563			1,726
Total other income	$	54		$	1,126		$	1,180		$	6,145		$	(4,143	)	$	2,002

Income from fiduciary activities increased by $1.2 million, or 6.0%, to $21.4 million in 2016, compared to $20.2 million in 2015. The $20.2 million in 2015 was an increase of $1.0 million, or 5.5%, compared to $19.2 million in 2014. The increases in fiduciary fee income in 2016 and 2015 were primarily due to improvements in the equity markets and also due to an increase in the total account balances serviced by PNB’s Trust Department.  PNB charges fiduciary fees largely based on the market value of the assets being managed. The average market value of the trust assets managed by PNB was $4.56 billion in 2016, compared to $4.38 billion in 2015, and $4.26 billion in 2014.

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Service charges on deposit accounts decreased by $492,000, or 3.3%, to $14.3 million in 2016, compared to $14.8 million in 2015. The $14.8 million in 2015 was a decrease of $672,000, or 4.4%, compared to $15.4 million in 2014. The declines in 2016 and 2015 were related to declines in service charges on deposits within Park's Ohio-based operations, largely as a result of a decline in fee income from overdraft charges and other non-sufficient funds (NSF) charges.  Park’s customers did not use our courtesy overdraft program as frequently in 2015 and 2016.

Fee income earned from the origination and sale into the secondary market of long-term, fixed-rate mortgage loans is included within “Other service income”.  Other service income increased by $3.0 million, or 26.1%, to $14.4 million in 2016, compared to $11.4 million in 2015. The $11.4 million in 2015 was an increase of $979,000, or 9.4%, compared to $10.5 million in 2014. The increase at PNB during 2016 and 2015 was primarily due to a corresponding increase in the amount of mortgage loans originated for sale in the secondary market which increased by $66.9 million for 2016 compared to 2015 and $84.7 million for 2015 compared to 2014 . The $1.4 million increase in other service income at SEPH for 2016 compared to 2015 was primarily the result of the recovery of fees from certain SEPH impaired loan relationships.

Checkcard fee income, which is generated from debit card transactions, increased $496,000, or 3.4%, to $15.1 million in 2016, compared to $14.6 million in 2015. The $14.6 million in 2015 was an increase of $991,000, or 7.3%, compared to $13.6 million in 2014. The increases in 2016 and 2015 were attributable to continued increases in the volume of debit card transactions. Debit card transactions for 2016 were 30.6 million compared to 29.9 million for 2015 and 28.4 million for 2014.

Bank owned life insurance income decreased by $1.4 million, or 25%, to $4.3 million in 2016, compared to $5.8 million in 2015. Bank owned life insurance income increased by $922,000, or 19.0%, to $5.8 million in 2015, compared to $4.9 million in 2014. The decrease of $1.4 million from 2015 to 2016 and the increase of $922,000 from 2014 to 2015 was primarily related to fluctuations in income from death benefits paid on policies. Park recorded $40,000 of income from death benefits paid on policies during 2016 compared to $1.3 million of income from death benefits paid on policies during 2015, and $383,000 of income from death benefits paid on policies in 2014.

Gain on the sale of OREO, net, totaled $1.3 million in 2016, a decrease of $281,000, compared to $1.6 million in 2015. The $1.6 million in 2015 was a decrease of $3.9 million, compared to $5.5 million in 2014. The table below provides details on the OREO sales at PNB and SEPH in 2016, 2015, and 2014.

Table 21 - Sales of OREO
(In thousands)	OREO Properties Sold	Book Balance of OREO Sold		Net Proceeds of OREO Sold		Gain on Sale (1)
2016:
PNB	52	$	3,199	$	3,400	$	201
PNB Participations in Vision assets	1	157		231		74
SEPH	13	4,007		5,073		1,066
Total	66	$	7,363	$	8,704	$	1,341
2015:
PNB	65	$	6,853	$	7,332	$	479
PNB Participations in Vision assets	3	521		984		463
SEPH	20	8,158		8,742		584
Total	88	$	15,532	$	17,058	$	1,526
2014:
PNB	90	$	7,271	$	8,191	$	920
PNB Participations in Vision assets	1	1,826		3,085		1,259
SEPH	114	13,258		16,522		3,264
Total	205	$	22,355	$	27,798	$	5,443

(1) The gain on sale amounts above exclude any deferred gain on sale.

OREO assets, property acquired through foreclosure, are initially recorded at fair value less anticipated selling costs (net realizable value), establishing a new cost basis. These assets are subsequently accounted for at the lower of cost or fair value less costs to sell. Subsequent changes in the value of real estate are classified as OREO valuation adjustments. OREO valuation

17

adjustments totaled $601,000 in 2016, a decrease of $991,000, or 62.2%, compared to $1.6 million in 2015. The $1.6 million in 2015 was a decrease of $814,000, or 33.8%, compared to $2.4 million in 2014.

Of the $601,000 in OREO valuation adjustments in 2016, $582,000 were related to valuation adjustments at PNB, of the $1.6 million in OREO valuation adjustments in 2015, $1.2 million were related to valuation adjustments at PNB, and of the $2.4 million in OREO valuation adjustment in 2014, $1.6 million were related to PNB. The decline in OREO valuation adjustments is consistent with the trend of lower OREO balances across the Park organization, which totaled $13.9 million, $18.7 million, and $22.6 million at December 31, 2016, 2015 and 2014, respectively.

Gain on the sale of commercial loans held for sale was $756,000 for 2015. This was related to certain commercial loans, which had a book balance of $144,000, that were sold in the first quarter of 2015. Gain on sale of commercial loans held for sale was $1.9 million in 2014. PNB sold $12.7 million of commercial loans held for sale in 2014, which resulted in a $328,000 loss on sale. SEPH sold $6.4 million of commercial loans held for sale in 2014, which resulted in a $2.2 million gain on sale. No commercial loans held for sale were sold in 2016.

Other miscellaneous income decreased by $1.3 million, or 16.9%, to $6.3 million in 2016, compared to $7.5 million in 2015. Other miscellaneous income increased by $1.7 million, or 29.7%, to $7.5 million in 2015, compared to $5.8 million in 2014.  The decrease in 2016, compared to 2015, was related to a $329,000 decrease in brokerage income, a $805,000 decline in income from the operation of OREO properties, and a $711,000 decrease in gains from the sale of repossessed and other assets. These decreases were offset by $461,000 in income from an equity investment during 2016. The increase in 2015, compared to 2014, was primarily due to a $1.2 million increase in income from the operation of OREO properties and a $468,000 increase in gains from the sale of assets.

Other Expense: Other expense was $199.0 million in 2016, compared to $186.6 million in 2015, and $187.5 million in 2014.  Other expense increased by $12.4 million, or 6.6%, in 2016, and decreased by $896,000, or 0.5% in 2015. The following table displays total other expense for Park for 2016, 2015 and 2014.

Table 22 - Other Expense
Year Ended December 31,
(In thousands)	2016		2015		2014
Salaries	$	87,034	$	86,189	$	81,977
Employee benefits	19,262		21,296		19,991
Data processing fees	5,608		5,037		4,712
Professional fees and services	27,181		23,452		29,580
Occupancy expense	10,239		9,686		10,006
Furniture and equipment expense	13,766		11,806		11,571
Insurance	5,825		5,629		5,723
Marketing	4,523		3,983		4,371
Communication	4,985		5,130		5,268
State tax expense	3,560		3,566		2,290
OREO expense	1,021		1,446		2,063
Borrowing prepayment penalty	5,554		532		—
Miscellaneous	10,465		8,862		9,958
Total other expense	$	199,023	$	186,614	$	187,510
Full-time equivalent employees	1,726		1,798		1,801

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The following table breaks out the change in other expense for the year ended December 31, 2016, compared to the year ended December 31, 2015, and for the year ended December 31, 2015 compared to the year ended December 31, 2014, in each of Park's Ohio-based operations and SEPH.

Table 23 - Other Expense Breakout
	Change from 2015 to 2016									Change from 2014 to 2015
(In thousands)	Ohio-based operations			SEPH			Total			Ohio-based operations			SEPH			Total
Salaries	$	943		$	(98	)	$	845		$	4,556		$	(344	)	$	4,212
Employee benefits	(2,235		)	201			(2,034		)	1,510			(205		)	1,305
Data processing fees	571			—			571			325			—			325
Professional fees and services	1,216			2,513			3,729			(780		)	(5,348		)	(6,128		)
Occupancy expense	553			—			553			(320		)	—			(320		)
Furniture and equipment expense	1,960			—			1,960			236			(1		)	235
Insurance	196			—			196			(88		)	(6		)	(94		)
Marketing	537			3			540			(388		)	—			(388		)
Communication	(147		)	2			(145		)	(135		)	(3		)	(138		)
State tax expense	(69		)	63			(6		)	1,351			(75		)	1,276
OREO expense	(373		)	(52		)	(425		)	(428		)	(189		)	(617		)
Borrowing prepayment penalty	5,022			—			5,022			532			—			532
Miscellaneous	3,144			(1,541		)	1,603			(1,683		)	587			(1,096		)
Total other expense	$	11,318		$	1,091		$	12,409		$	4,688		$	(5,584	)	$	(896	)

Salaries expense increased $845,000, or 1.0%, to $87.0 million in 2016, and increased by $4.2 million, or 5.1%, to $86.2 million in 2015. The increase in 2016 was primarily due to an increase of $1.0 million in share-based compensation expense related to the Park 2013 Long-Term Incentive Plan (the "2013 Incentive Plan") offset by a $374,000 decrease in incentive compensation. The increase in 2015 was due to an increase in salaries of $2.9 million, an increase in incentive compensation of $937,000, and an increase in share-based compensation expense related to the Park 2013 Incentive Plan of $407,000 compared to 2014. Park had 1,726 full-time equivalent employees at year-end 2016, compared to 1,798 full-time equivalent employees at year-end 2015, and 1,801 full-time equivalent employees at year-end 2014.

Employee benefits expense decreased $2.0 million, or 9.6%, to $19.3 million in 2016, and increased by $1.3 million, or 6.5%, to $21.3 million in 2015. The decrease in 2016 was due to a $3.9 million decrease in group insurance costs, offset by a $1.1 million increase in other employee benefits. The increase in 2015 was primarily due to a $1.3 million increase in pension and salary deferral plan expense, compared to 2014.

Professional fees and services increased $3.7 million, or 15.9%, to $27.2 million in 2016, compared to $23.5 million in 2015. The $23.5 million in 2015 was a decrease of $6.1 million, or 20.7%, compared to $29.6 million in 2014. This subcategory of total other expense includes legal fees, management consulting fees, director fees, audit fees, regulatory examination fees and memberships in industry associations. The increase in professional fees and services expense in 2016 was primarily due to an increase in consulting fees at SEPH and increases in third-party credit related expense at PNB. The decrease in professional fees and services expense in 2015 was largely related to declines in legal expenses associated with PNB participations in Vision loans and other loan relationships at SEPH. 

Furniture and equipment expense increased $2.0 million, or 16.6%, to $13.8 million in 2016, compared to $11.8 million in 2015. The increase in furniture and equipment expense in 2016 was primarily due to a $1.0 million increase in depreciation expense and a $1.0 million increase in maintenance expense.

OREO expense declined $425,000, or 29.4%, to $1.0 million in 2016, compared to $1.4 million in 2015. The $1.4 million in 2015 was a decline of $617,000, or 29.9%, compared to $2.1 million in 2014. The decline in OREO expense was consistent with the trend of lower OREO balances across the Park organization, which totaled $13.9 million, $18.7 million, and $22.6 million at December 31, 2016, 2015 and 2014, respectively.

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Borrowing prepayment penalties increased by $5.0 million, to $5.6 million in 2016, compared to $532,000 in 2015. During 2016, Park prepaid $50 million of Federal Home Loan Bank (“FHLB”) advances, incurring a $5.6 million prepayment penalty. These advances had an interest rate of 3.15% and a maturity date of November 13, 2023.

The subcategory "Miscellaneous" other expense includes expenses for supplies, travel, charitable contributions, and other miscellaneous expense. The subcategory miscellaneous other expense increased by $1.6 million, or 18.1%, to $10.5 million in 2016, compared to $8.9 million in 2015. The $8.9 million in 2015 was a decrease of $1.1 million, or 11.0%, compared to $10.0 million in 2014. The $1.6 million increase in 2016 was primarily due to a $1.7 million increase in accruals due to the ongoing evaluation of litigation and other proceedings impacting the GFSC subsidiary and the Parent Company, a $2.0 million increase in contribution expense and a $883,000 increase in fraud losses, offset by a reduction in expenses as $0.6 million was recognized in 2015 related to a contract termination fee, a $1.0 million reduction in expense related to reserves established for potential mortgage loan repurchases, and a decrease of $996,000 related to the amortization of historic tax credits.

The $1.1 million decrease in 2015 was primarily due to a $1.5 million decrease in contribution expense, a $1.0 million decrease in expense due to the ongoing evaluation of litigation and other proceedings impacting the GFSC subsidiary, and a decrease of $1.3 million due to a reduction in contract termination fees, offset by a $1.2 million increase related to reserves established for potential mortgage loan repurchases and a $996,000 increase related to the amortization of historic tax credits.

Income Taxes: Federal income tax expense was $36.8 million in 2016, compared to $32.6 million in 2015, and $36.5 million in 2014.  Federal income tax expense as a percentage of income before taxes was 29.9% in 2016, 28.7% in 2015, and 30.3% in 2014.  The difference between the statutory federal income tax rate of 35% and Park’s effective tax rate reflects permanent tax differences, primarily consisting of tax-exempt interest income from municipal investments and loans, qualified affordable housing and historical tax credits, bank owned life insurance income, and dividends paid on common shares held within Park’s salary deferral plan. Park's permanent tax differences for 2016 were approximately $6.3 million compared to $7.2 million for 2015.

CREDIT EXPERIENCE

(Recovery of) Provision for Loan Losses: The (recovery of) provision for loan losses is the amount added to the allowance for loan losses to ensure the allowance is sufficient to absorb probable, incurred credit losses. The amount of the (recovery of) provision for loan losses is determined by management after reviewing the risk characteristics of the loan portfolio, historic and current loan loss experience and current economic conditions.

The table below provides additional information on the provision for loan losses and the ALLL for Park for 2016, 2015 and 2014.

Table 24 - ALLL Information - Park
(In thousands)	2016			2015			2014
ALLL, beginning balance	$	56,494		$	54,352		$	59,468
Charge-offs	20,799			14,290			24,780
Recoveries	(20,030		)	(11,442		)	(26,997		)
Net charge-offs (recoveries)	769			2,848			(2,217		)
(Recovery of) provision for loan losses:	(5,101		)	4,990			(7,333		)
ALLL, ending balance	$	50,624		$	56,494		$	54,352
Average loans	$	5,122,862		$	4,909,579		$	4,717,297
Net charge-offs (recoveries) as a percentage of average loans	0.02		%	0.06		%	(0.05		)%

For the year ended December 31, 2016, gross income of $6.8 million would have been recognized on loans that were nonaccrual as of December 31, 2016 had these loans been current in accordance with their original terms. Interest income on nonaccrual loans may be recorded on a cash basis and be included in earnings only when Park expects to receive the entire recorded investment of the loan. Of the $6.8 million that would have been recognized, approximately $6.0 million was included in interest income for the year ended December 31, 2016.

20

Park's Ohio-based subsidiaries, PNB and GFSC, are the only subsidiaries that carry an ALLL balance. The table below provides additional information on the provision for loan losses and the ALLL for Park’s Ohio-based subsidiaries for 2016, 2015 and

2014.

Table 25 - ALLL Information - Park's Ohio-Based Subsidiaries
(In thousands)	2016			2015			2014
ALLL, beginning balance	$	56,494		$	54,352		$	59,468
Charge-offs:
Ohio-based subsidiaries loans	20,274			14,143			22,988
PNB participations in Vision loans	78			20			667
Total charge-offs	20,352			14,163			23,655
Recoveries:
Ohio-based subsidiaries loans	(6,788		)	(5,770		)	(6,613		)
PNB participations in Vision loans	(3,196		)	(1,455		)	(6,865		)
Total recoveries	(9,984		)	(7,225		)	(13,478		)
Net charge-offs	10,368			6,938			10,177
Provision for (recovery of) loan losses:
Ohio-based subsidiaries loans	7,616			10,515			11,259
PNB participations in Vision loans	(3,118		)	(1,435		)	(6,198		)
Total provision for loan losses	4,498			9,080			5,061
ALLL, ending balance	$	50,624		$	56,494		$	54,352
Average loans, Ohio-based subsidiaries	$	5,108,428		$	4,891,670		$	4,685,461
Net charge-offs as a percentage of average loans	0.20		%	0.14		%	0.22		%
Net charge-offs as a percentage of average loans - excluding PNB participations in Vision loans	0.26		%	0.17		%	0.35		%

Charge-offs for 2016 include the charge-off of $2.2 million in specific reserves for which provision expense had been recognized in a prior year compared to $412,000 for 2015 and $6.4 million for 2014. Net charge-offs adjusted for changes in specific reserves as a percentage of average loans for the years ended December 31, 2016, 2015, 2014 were 0.13%, 0.15%, and 0.07%, respectively.

SEPH, as a non-bank subsidiary of Park, does not carry an ALLL balance, but recognizes a provision for loan losses when a charge-off is taken and recognizes a recovery of loan losses when a recovery is received.

Table 26 - ALLL Information - SEPH
(In thousands)	2016			2015			2014
ALLL, beginning balance	$	—		$	—		$	—
Charge-offs	447			127			1,125
Recoveries	(10,046		)	(4,217		)	(13,519		)
Net recoveries	(9,599		)	(4,090		)	(12,394		)
Recovery of loan losses:	(9,599		)	(4,090		)	(12,394		)
ALLL, ending balance	$	—		$	—		$	—
Average loans	$	14,434		$	17,910		$	31,836

21

At year-end 2016, the allowance for loan losses was $50.6 million, or 0.96% of total loans outstanding, compared to $56.5 million, or 1.11% of total loans outstanding at year-end 2015, and $54.4 million, or 1.13% of total loans outstanding at year-end 2014. The table below provides additional information related to specific reserves on impaired commercial loans and general reserves for all other loans in Park’s portfolio at December 31, 2016, 2015 and 2014.

Table 27 - General Reserve Trends - Park
	Year Ended December 31,
(In thousands)	2016			2015			2014
Allowance for loan losses, end of period	$	50,624		$	56,494		$	54,352
Specific reserves	548			4,191			3,660
General reserves	$	50,076		$	52,303		$	50,692
Total loans	$	5,271,857		$	5,068,085		$	4,829,682
Impaired commercial loans	70,415			80,599			73,676
Non-impaired loans	$	5,201,442		$	4,987,486		$	4,756,006
Allowance for loan losses as a percentage of year-end loans	0.96		%	1.11		%	1.13		%
General reserves as a percentage of non-impaired loans	0.96		%	1.05		%	1.07		%

Specific reserves decreased $3.6 million to $548,000 at December 31, 2016, compared to $4.2 million at December 31, 2015. The decrease is largely due to the fourth quarter 2016 charge-off of $3.1 million in specific reserves. General reserves decreased $2.2 million, or 4.3%, to $50.1 million at December 31, 2016, compared to $52.3 million at December 31, 2015. The decrease in general reserves was due to the ongoing evaluation of the required allowance for loan losses to cover probable incurred losses in the Park loan portfolio.

Management believes that the allowance for loan losses at year-end 2016 is adequate to absorb probable, incurred credit losses in the loan portfolio. See Note 1 of the Notes to Consolidated Financial Statements and the discussion under the heading “CRITICAL ACCOUNTING POLICIES” earlier in this Management's Discussion and Analysis for additional information on management’s evaluation of the adequacy of the allowance for loan losses.

22

The table below provides a summary of Park's loan loss experience over the past five years:

Table 28  -  Summary of Loan Loss Experience
(In thousands)	2016			2015			2014			2013			2012
Average loans (net of unearned interest)	$	5,122,862		$	4,909,579		$	4,717,297		$	4,514,781		$	4,410,661
Allowance for loan losses:
Beginning balance	56,494			54,352			59,468			55,537			68,444
Charge-offs:
Commercial, financial
and agricultural	5,786			2,478			3,779			6,160			26,847
Real estate - construction	1,436			470			1,316			1,791			9,985
Real estate - residential	3,014			2,352			3,944			3,207			8,607
Real estate - commercial	412			348			8,003			1,832			10,454
Consumer	10,151			8,642			7,738			6,163			5,375
Leases	—			—			—			—			—
Total charge-offs	$	20,799		$	14,290		$	24,780		$	19,153		$	61,268
Recoveries:
Commercial, financial
and agricultural	$	1,259		$	1,373		$	1,003		$	1,314		$	1,066
Real estate - construction	8,559			2,092			12,572			9,378			2,979
Real estate - residential	2,446			2,438			2,985			6,000			5,559
Real estate - commercial	3,671			2,241			7,759			726			783
Consumer	4,094			3,295			2,671			2,249			2,555
Leases	1			3			7			2			—
Total recoveries	$	20,030		$	11,442		$	26,997		$	19,669		$	12,942
Net charge-offs (recoveries)	$	769		$	2,848		$	(2,217	)	$	(516	)	$	48,326
(Recovery) provision included in earnings	(5,101		)	4,990			(7,333		)	3,415			35,419
Ending balance	$	50,624		$	56,494		$	54,352		$	59,468		$	55,537
Ratio of net charge-offs (recoveries) to average loans	0.02		%	0.06		%	(0.05		)%	(0.01		)%	1.10		%
Ratio of allowance for loan losses
to end of year loans	0.96		%	1.11		%	1.13		%	1.29		%	1.25		%

23

The following table summarizes Park's allocation of the allowance for loan losses for the past five years:

Table 29 - Allocation of Allowance for Loan Losses
December 31,	2016				2015				2014				2013				2012
(In thousands)	Allowance		Percent of Loans Per Category		Allowance		Percent of Loans Per Category		Allowance		Percent of Loans Per Category		Allowance		Percent of Loans Per Category		Allowance		Percent of Loans Per Category
Commercial, financial, and agricultural	$	13,434	18.87	%	$	13,694	18.86	%	$	10,719	17.73	%	$	14,218	17.87	%	$	15,635	18.51	%
Real estate - construction	5,247		3.58	%	8,564		3.42	%	8,652		3.23	%	6,855		3.38	%	6,841		3.72	%
Real estate - residential	10,958		34.31	%	13,514		36.61	%	14,772		38.33	%	14,251		38.95	%	14,759		38.51	%
Real estate - commercial	10,432		21.92	%	9,197		21.97	%	8,808		22.15	%	15,899		24.07	%	11,736		24.54	%
Consumer	10,553		21.26	%	11,524		19.08	%	11,401		18.49	%	8,245		15.66	%	6,566		14.65	%
Leases	—		0.06	%	1		0.06	%	—		0.07	%	—		0.07	%	—		0.07	%
Total	$	50,624	100.00	%	$	56,494	100.00	%	$	54,352	100.00	%	$	59,468	100.00	%	$	55,537	100.00	%

As of December 31, 2016, Park had no concentrations of loans exceeding 10% to borrowers engaged in the same or similar industries nor did Park have any loans to foreign governments.

Nonperforming Assets: Nonperforming loans include: 1) loans whose interest is accounted for on a nonaccrual basis; 2) troubled debt restructurings (TDRs) on accrual status; and 3) loans which are contractually past due 90 days or more as to principal or interest payments, where interest continues to accrue.  Park's management continues to evaluate TDRs to determine those that may be appropriate to return to accrual status. Specifically, if the restructured note has been current for a period of at least six months and management expects the borrower will remain current throughout the renegotiated contract, the loan may be returned to accrual status. Nonperforming assets include nonperforming loans and OREO. OREO results from taking possession of property that served as collateral for a defaulted loan.

Generally, management obtains updated appraisal information for nonperforming loans and OREO annually. As new appraisal information is received, management performs an evaluation of the appraisal and applies a discount for anticipated disposition costs to determine the net realizable value of the collateral, which is compared to the outstanding principal balance to determine if additional write-downs are necessary.

The following is a summary of Park’s nonaccrual loans, accruing TDRs, loans past due 90 days or more and still accruing, and OREO for the last five years:

Table 30  -  Park - Nonperforming Assets
	December 31,
(In thousands)	2016			2015			2014			2013			2012
Nonaccrual loans	$	87,822		$	95,887		$	100,393		$	135,216		$	155,536
Accruing TDRs	18,175			24,979			16,254			18,747			29,800
Loans past due 90 days or more and accruing	2,086			1,921			2,641			1,677			2,970
Total nonperforming loans	$	108,083		$	122,787		$	119,288		$	155,640		$	188,306
OREO – PNB	6,025			7,456			10,687			11,412			14,715
OREO – SEPH	7,901			11,195			11,918			23,224			21,003
Total nonperforming assets	$	122,009		$	141,438		$	141,893		$	190,276		$	224,024
Percentage of nonperforming loans to total loans	2.05		%	2.42		%	2.47		%	3.37		%	4.23		%
Percentage of nonperforming assets to total loans	2.31		%	2.79		%	2.94		%	4.12		%	5.03		%
Percentage of nonperforming assets to total assets	1.63		%	1.93		%	2.03		%	2.87		%	3.37		%

24

SEPH nonperforming assets for the last five years were as follows:

Table 31 - SEPH - Nonperforming Assets
	December 31,
(In thousands)	2016		2015		2014		2013		2012
Nonaccrual loans	$	11,738	$	14,419	$	22,916	$	36,108	$	55,292
Accruing TDRs	—		—		97		—		—
Loans past due 90 days or more and accruing	—		—		—		—		—
Total nonperforming loans	$	11,738	$	14,419	$	23,013	$	36,108	$	55,292
OREO - SEPH	7,901		11,195		11,918		23,224		21,003
Total nonperforming assets	$	19,639	$	25,614	$	34,931	$	59,332	$	76,295

Nonperforming assets for Park, excluding SEPH, for the last five years were as follows:

Table 32 - Park excluding SEPH - Nonperforming Assets
	December 31,
(In thousands)	2016			2015			2014			2013			2012
Nonaccrual loans	$	76,084		$	81,468		$	77,477		$	99,108		$	100,244
Accruing TDRs	18,175			24,979			16,157			18,747			29,800
Loans past due 90 days or more and accruing	2,086			1,921			2,641			1,677			2,970
Total nonperforming loans	$	96,345		$	108,368		$	96,275		$	119,532		$	133,014
OREO – PNB	6,025			7,456			10,687			11,412			14,715
Total nonperforming assets (1)	$	102,370		$	115,824		$	106,962		$	130,944		$	147,729
Percentage of nonperforming loans to total loans	1.83		%	2.14		%	2.00		%	2.61		%	3.03		%
Percentage of nonperforming assets to total loans	1.95		%	2.29		%	2.23		%	2.86		%	3.36		%
Percentage of nonperforming assets to total assets	1.38		%	1.60		%	1.55		%	2.00		%	2.26		%

(1) Includes PNB participations in loans originated by Vision and related OREO totaling $9.6 million, $9.8 million, $11.5 million, $12.3 million, and $19.0 million for the years ended December 31, 2016, 2015, 2014, 2013 and 2012, respectively.

Park’s allowance for loan losses includes an allocation for loans specifically identified as impaired under GAAP. At December 31, 2016, loans considered to be impaired consisted substantially of commercial loans graded as "substandard" or “doubtful” and placed on non-accrual status.  Specific reserves on impaired commercial loans are typically based on management’s best estimate of the fair value of collateral securing these loans. The amount ultimately charged off for these loans may be different from the specific reserve as the ultimate liquidation of the collateral may be for amounts different from management’s estimates.

When determining the quarterly and annual loan loss provision, Park reviews the grades of commercial loans.  These loans are graded from 1 to 8.  A grade of 1 indicates little or no credit risk and a grade of 8 is considered a loss.  Commercial loans that are pass-rated are considered to be of acceptable credit risk.  Commercial loans graded a 5 (special mention) are considered to be watch list credits and a higher loan loss reserve percentage is allocated to these loans.  Commercial loans graded a 6 (substandard), also considered watch list credits, are considered to represent higher credit risk and, as a result, a higher loan loss reserve percentage is allocated to these loans.  Generally, commercial loans that are graded a 6 are considered for partial charge-off or have been charged down to the net realizable value of the underlying collateral.  Commercial loans graded a 7 (doubtful) are shown as nonperforming and Park charges these loans down to their fair value by taking a partial charge-off or recording a specific reserve.  Any commercial loan graded an 8 (loss) is completely charged off.

25

The following table highlights the credit trends within the commercial loan portfolio of Park’s Ohio-based operations.

Table 33 - Park Ohio - Commercial Credit Trends
Commercial loans * (In thousands)	December 31, 2016		December 31, 2015		December 31, 2014
Pass rated	$	2,601,607	$	2,493,518	$	2,360,689
Special Mention	14,644		24,223		15,946
Substandard	441		4,268		3,553
Impaired	58,676		66,232		51,323
Total	$	2,675,368	$	2,588,241	$	2,431,511

* Commercial loans include: (1) Commercial, financial and agricultural loans, (2) Commercial real estate loans, (3) Commercial related loans in the construction real estate portfolio and (4) Commercial related loans in the residential real estate portfolio.

Delinquencies have remained low for Park's Ohio-based operations over the past 24 months. Delinquent and accruing loans were $27.8 million, or 0.53% of total loans at December 31, 2016, compared to $25.7 million, or 0.51% of total loans at December 31, 2015 and $33.0 million, or 0.69% of total loans at December 31, 2014.

Impaired commercial loans for Park's Ohio-based operations were $58.7 million at December 31, 2016, a decrease of $7.6 million, compared to $66.2 million as of December 31, 2015. The $58.7 million of impaired commercial loans at December 31, 2016 included $6.4 million of loans modified in a troubled debt restructuring which are currently on accrual status and performing in accordance with the restructured terms, down from $12.4 million at December 31, 2015. Impaired commercial loans are individually evaluated for impairment and specific reserves are established to cover any probable, incurred losses for those loans that have not been charged down to the net realizable value of the underlying collateral or to the net present value of expected cash flows.

Park had $15.1 million of non-impaired commercial loans included on the watch list at December 31, 2016, compared to $28.5 million of non-impaired commercial loans at year-end 2015, and $19.5 million of non-impaired commercial loans at year-end 2014. Commercial loans include: (1) commercial, financial and agricultural loans; (2) commercial real estate loans; (3) certain real estate construction loans; and (4) certain residential real estate loans. Park’s watch list includes all criticized and classified commercial loans, defined by Park as loans rated special mention or worse, less those commercial loans currently considered to be impaired. As a percentage of year-end total commercial loans, Park’s watch list of potential problem commercial loans was 0.6% in 2016, 1.1% in 2015, and 0.8% in 2014. The existing conditions of these loans do not warrant classification as nonaccrual. However, these loans have shown some weakness and management performs additional analyses regarding each borrower’s ability to comply with payment terms.

As of December 31, 2016, management had taken partial charge-offs of approximately $24.9 million related to the $70.4 million of commercial loans considered to be impaired, compared to charge-offs of approximately $28.7 million related to the $80.6 million of impaired commercial loans at December 31, 2015.  The table below provides additional information related to Park's impaired commercial loans at December 31, 2016, including those impaired commercial loans at PNB, PNB participations in impaired Vision loans and those impaired Vision commercial loans retained at SEPH.

Table 34 - Park Impaired Commercial Loans
December 31, 2016
(In thousands)	Unpaid principal balance (UPB)		Prior charge- offs		Total impaired loans		Specific reserve		Carrying balance		Carrying balance as a % of UPB
PNB	$	64,529	$	10,772	$	53,757	$	548	$	53,209	82.46	%
PNB Participations in Vision loans	8,372		3,453		4,919		—		4,919		58.76	%
SEPH	22,457		10,718		11,739		—		11,739		52.27	%
Total Park	$	95,358	$	24,943	$	70,415	$	548	$	69,867	73.27	%

26

Allowance for loan losses: Loss factors are reviewed quarterly and updated at least annually to reflect recent loan loss history and incorporate current risk and trends which may not be recognized in historical data. Several enhancements were made in the third quarter of 2016 as a result of management's quarterly review.

• Management updated the historical loss calculation during the third quarter of 2016, incorporating annualized net charge-offs plus changes in specific reserves through September 30, 2016. Additionally, management removed from the historical loss calculation net charge-offs plus changes in specific reserves for the year ended December 31, 2009. Management's belief has been that historical losses should encompass the complete economic cycle. However, given the extended length of the economic recovery, management determined that 2009 loss data was no longer reflective of the current portfolio. Management has taken the look-back period into consideration in the quarterly evaluation of environmental loss factors.

• As part of the 2016 mid-year historical loss update, management determined that it was no longer appropriate to more heavily weight those years with higher losses in the historical loss calculation and applied equal percentages to each of the years in this calculation. The trends that existed resulting in management applying different weightings to the years within the historical loss calculation no longer appeared to exist, resulting in the adjustment back to equal weightings.

• As part of the normal quarterly process, management reviewed and updated the environmental loss factors applied to the commercial portfolio in order to incorporate changes in the macroeconomic environment. Additionally, management updated the calculation of the loss emergence period utilizing a more granular process.

The impact of the changes described above resulted in a decrease of $3.8 million in the ALLL at September 30, 2016, compared to what the ALLL would have been had the calculation, and related assumptions, used at June 30, 2016 remained constant.

The historical loss factors were updated again in the fourth quarter of 2016 to incorporate losses through December 31, 2016.

A significant portion of Park’s allowance for loan losses is allocated to commercial loans. “Special mention” loans are loans that have potential weaknesses that may result in loss exposure to Park.  “Substandard” loans are those that exhibit a well-defined weakness, jeopardizing repayment of the loans, resulting in a higher probability that Park will suffer a loss on the loans unless the weakness is corrected. The allowance for loan losses related to performing commercial loans was $32.8 million or 1.25% of the outstanding principal balance of other accruing commercial loans at December 31, 2016. At December 31, 2016, the coverage level within the commercial loan portfolio was approximately 3.20 years compared to 2.37 years at December 31, 2015. Historical loss experience, defined as charge-offs plus changes in specific reserves, over the past 84 months for the commercial loan portfolio was 0.39% for 2016 and 0.53% for 2015. This 84-month loss experience includes only the performance of the PNB loan portfolio and excludes the impact of PNB participations in Vision loans.

The overall reserve of 1.25% for other accruing commercial loans breaks down as follows: pass-rated commercial loans are reserved at 1.24%; special mention commercial loans are reserved at 3.82%; and substandard commercial loans are reserved at 12.88%.  The reserve levels for pass-rated, special mention and substandard commercial loans in excess of the annualized 84-month loss experience of 0.39% are due to the following factors which management reviews on a quarterly or annual basis:

• Loss Emergence Period Factor: At least annually, management calculates the loss emergence period for each commercial loan segment. This loss emergence period is calculated based upon the average period of time it takes from the probable occurrence of a loss event to the credit being moved to nonaccrual. If the loss emergence period for any commercial loan segment is greater than one year, management applies additional general reserves to all performing loans within that segment of the commercial loan portfolio. The loss emergence period was last updated in the fourth quarter of 2016.

• Loss Migration Factor: Park’s commercial loans are individually risk graded. If loan downgrades occur, the probability of default increases, and accordingly, management allocates a higher percentage reserve to those accruing commercial loans graded special mention and substandard. Annually, management calculates a loss migration factor for each commercial loan segment for special mention and substandard credits based on a review of losses over the period of time a loan takes to migrate from pass-rated to impaired. The loss migration factor was last updated in the fourth quarter of 2016.

• Environmental Loss Factor: Management has identified certain macroeconomic factors that trend in accordance with losses in Park’s commercial loan portfolio. These macroeconomic factors are reviewed quarterly and the adjustments made to the environmental loss factor impacting each segment in the performing commercial loan portfolio correlate to changes in the macroeconomic environment.

27

Generally, consumer loans are not individually graded. Consumer loans include: (1) mortgage and installment loans included in the construction real estate segment of the loan portfolio; (2) mortgage, home equity lines of credit (HELOC), and installment loans included in the residential real estate segment of the loan portfolio; and (3) all loans included in the consumer segment of the loan portfolio. The amount of loan loss reserve assigned to these loans is based on historical loss experience over the past 84 months, through December 31, 2016. Management generally considers a one-year coverage period (the “Historical Loss Factor”) appropriate because the probable loss on any given loan in the consumer loan pool should ordinarily become apparent in that time frame. However, management may incorporate adjustments to the Historical Loss Factor as circumstances warrant additional reserves (e.g., increased loan delinquencies, borrower bankruptcy status, improving or deteriorating economic conditions, changes in lending management and underwriting standards, etc.). At December 31, 2016, the coverage level within the consumer loan portfolio was approximately 1.95 years compared to 1.99 years at December 31, 2015. Historical loss experience over the past 84 months for the consumer loan portfolio was 0.34% for 2016 and 0.42% for 2015.

The judgmental increases discussed above incorporate management’s evaluation of the impact of environmental qualitative factors which pose additional risks and assignment of a component of the allowance for loan losses in consideration of these factors.  Such environmental factors include: national and local economic trends and conditions; experience, ability and depth of lending management and staff; effects of any changes in lending policies and procedures; and levels of, and trends in, consumer bankruptcies, delinquencies, impaired loans, and charge-offs and recoveries.  The determination of this component of the allowance for loan losses requires considerable management judgment.  Management is working to address weaknesses in those loans that may result in future loss.  Actual loss experience may be more or less than the amount allocated.

CAPITAL RESOURCES

Liquidity and Interest Rate Sensitivity Management: Park’s objective in managing our liquidity is to maintain the ability to continuously meet the cash flow needs of customers, such as borrowings or deposit withdrawals, while at the same time seeking higher yields from longer-term lending and investing activities.

Cash and cash equivalents decreased by $3.0 million during 2016 to $146.4 million at year end. Cash provided by operating activities was $87.9 million in 2016, $89.2 million in 2015, and $71.7 million in 2014. Net income was the primary source of cash from operating activities during each year.

Cash used in investing activities was $152.6 million in 2016, $395.5 million in 2015, and $229.6 million in 2014. Investment security transactions and loan originations/repayments are the major use or source of cash in investing activities.  Proceeds from the sale, repayment or maturity of investment securities provide cash and purchases of investment securities use cash.  Net investment security transactions provided cash of $59.7 million in 2016, used cash of $145.2 million in 2015, and used cash of $29.7 million in 2014. Cash used by the net increase in the loan portfolio was $199.5 million in 2016, $247.9 million in 2015, and $234.0 million in 2014.

Cash provided by financing activities was $61.7 million in 2016, $218.0 million in 2015, and $248.5 million in 2014. A major source of cash for financing activities is the net change in deposits.  Deposits increased and provided $174.3 million of cash in 2016, $219.6 million of cash in 2015, and $338.0 million of cash in 2014. Of the $338.0 million deposit increase in 2014, $200 million was related to the settlement of brokered deposits in September 2014. Another major source of cash for financing activities is short-term borrowings and long-term debt. In 2016, net long-term borrowings decreased and used $55.6 million in cash. In 2015, net short-term borrowings increased and provided $117.3 million in cash, and net long-term borrowings decreased and used $55.1 million in cash. In 2014, net short-term borrowings increased and provided $35.0 million in cash, and net long-term borrowings decreased and used $64.2 million in cash. Finally, cash declined by $57.7 million in 2016, $57.8 million in 2015, and $57.9 million in 2014, from the payment of cash dividends.

Funds are available from a number of sources, including the capital markets, the investment securities portfolio, the core deposit base, Federal Home Loan Bank borrowings, the capability to securitize or package loans for sale, and a $10.0 million revolving line of credit with another financial institution, which did not have an outstanding balance as of December 31, 2016.  In the opinion of Park's management, the present funding sources provide more than adequate liquidity for Park to meet our cash flow needs.

28

The following table shows interest rate sensitivity data for five different time intervals as of December 31, 2016:

Table 35  -  Interest Rate Sensitivity
	0-3			3-12			1-3			3-5			Over 5
(In thousands)	Months			Months			Years			Years			Years			Total
Interest earning assets:
Investment securities  (1)	$	108,523		$	174,350		$	521,948		$	238,808		$	540,776		$	1,584,405
Money market instruments	23,635			—			—			—			—			23,635
Loans  (1)	1,400,192			1,254,926			1,769,078			679,532			168,129			5,271,857
Total interest earning assets	1,532,350			1,429,276			2,291,026			918,340			708,905			6,879,897
Interest bearing liabilities:
Interest bearing transaction accounts (2)	$	596,867		$	—		$	577,582		$	—		$	—		$	1,174,449
Savings accounts (2)	659,943			—			1,044,977			—			—			1,704,920
Time deposits	282,067			438,813			281,491			115,003			495			1,117,869
Other	—			1,301			—			—			—			1,301
Total deposits	1,538,877			440,114			1,904,050			115,003			495			3,998,539
Short-term borrowings	394,795			—			—			—			—			394,795
Long-term debt	—			344,281			225,000			25,000			100,000			694,281
Subordinated notes	15,000			30,000			—			—			—			45,000
Total interest bearing liabilities	1,948,672			814,395			2,129,050			140,003			100,495			5,132,615
Interest rate sensitivity gap	(416,322		)	614,881			161,976			778,337			608,410			1,747,282
Cumulative rate sensitivity gap	(416,322		)	198,559			360,535			1,138,872			1,747,282
Cumulative gap as a
percentage of total
interest earning assets	(6.05		)%	2.89		%	5.24		%	16.55		%	25.40		%

(1) Investment securities and loans that are subject to prepayment are shown in the table by the earlier of their re-pricing date or their expected repayment date and not by their contractual maturity date. Nonaccrual loans of $87.8 million are included within the three-month to twelve-month maturity category. 

(2) Management considers interest bearing transaction accounts and savings accounts to be core deposits and, therefore, not as rate sensitive as other deposit accounts and borrowed money. Accordingly, only 51% of interest bearing transaction accounts and 39% of savings accounts are considered to re-price within one year. If all of the interest bearing transaction accounts and savings accounts were considered to re-price within one year, the one-year cumulative gap would change from a positive 2.89% to a negative 20.70%.

The interest rate sensitivity gap analysis provides an overall picture of Park’s static interest rate risk position.  At December 31, 2016, the cumulative interest earning assets maturing or repricing within twelve months were $2,962 million compared to the cumulative interest bearing liabilities maturing or repricing within twelve months of $2,763 million.  For the twelve-month cumulative interest rate sensitivity gap position, rate sensitive assets exceeded rate sensitive liabilities by $199 million or 2.89% of interest earning assets.

A positive twelve-month cumulative rate sensitivity gap (assets exceed liabilities) would suggest that Park’s net interest margin would increase if interest rates were to increase.  Conversely, a negative twelve-month cumulative rate sensitivity gap would suggest that Park’s net interest margin would decrease if interest rates were to increase. However, the usefulness of the interest rate sensitivity gap analysis as a forecasting tool in projecting net interest income is limited.  The gap analysis does not consider the magnitude, timing or frequency by which assets or liabilities will reprice during a period and also contains assumptions as to the repricing of transaction and savings accounts that may not prove to be correct.

The cumulative twelve-month interest rate sensitivity gap position at year-end 2015 was a positive $407 million or 6.03% of total interest earning assets.  The percentage of interest earning assets maturing or repricing within one year was 43.0% at year-

29

end 2016, compared to 40.8% at year-end 2015.  The percentage of interest bearing liabilities maturing or repricing within one year was 53.8% at year-end 2016, compared to 45.8% at year-end 2015.

Management supplements the interest rate sensitivity gap analysis with periodic simulations of balance sheet sensitivity under various interest rate and what-if scenarios to better forecast and manage the net interest margin.  Park’s management uses an earnings simulation model to analyze net interest income sensitivity to movements in interest rates.  This model is based on actual cash flows and repricing characteristics for balance sheet instruments and incorporates market-based assumptions regarding the impact of changing interest rates on the prepayment rate of certain assets and liabilities.  This model also includes management’s projections for activity levels of various balance sheet instruments and non-interest fee income and operating expense.  Assumptions based on the historical behavior of deposit rates and balances in relation to changes in interest rates are also incorporated into this earnings simulation model.  These assumptions are inherently uncertain and, as a result, the model cannot precisely measure net interest income and net income.  Actual results will differ from simulated results due to the timing, magnitude and frequency of interest rate changes as well as changes in market conditions and management strategies.

Management uses a 50 basis point change in market interest rates per quarter for a total of 200 basis points per year in evaluating the impact of changing interest rates on net interest income and net income over a twelve-month horizon.  At December 31, 2016, the earnings simulation model projected that net income would decrease by 1.9% using a rising interest rate scenario and decrease by 6.3% using a declining interest rate scenario over the next year.  At December 31, 2015, the earnings simulation model projected that net income would decrease by 0.4% using a rising interest rate scenario and decrease by 10.9% using a declining interest rate scenario over the next year.  At December 31, 2014, the earnings simulation model projected that net income would increase by 1.3% using a rising interest rate scenario and decrease by 7.1% using a declining interest rate scenario over the following year.  Consistently, over the past several years, Park’s earnings simulation model has projected that changes in interest rates would have only a small impact on net income and the net interest margin.  Park’s net interest margin was 3.52% in 2016, 3.39% in 2015 and 3.55% in 2014.   

CONTRACTUAL OBLIGATIONS

In the ordinary course of operations, Park enters into certain contractual obligations. The following table summarizes Park’s significant and determinable obligations by payment date at December 31, 2016.

Further discussion of the nature of each specified obligation is included in the referenced Note to the Consolidated Financial Statements.

Table 36 - Contractual Obligations
December 31, 2016	Payments Due In
		0-1		1-3		3-5		Over 5
(In thousands)	Note	Years		Years		Years		Years		Total
Deposits without stated maturity	11	$	4,404,086	$	—	$	—	$	—	$	4,404,086
Certificates of deposit	11	717,879		284,493		115,003		495		1,117,870
Short-term borrowings	13	394,795		—		—		—		394,795
Long-term debt	14	350,000		225,000		25,000		100,000		700,000
Subordinated notes	15	—		—		—		45,000		45,000
Operating leases	9	1,508		2,447		1,043		700		5,698
Defined benefit pension plan (1)	18	6,924		15,519		17,896		48,058		88,397
Purchase obligations		22		—		—		—		22
Total contractual obligations		$	5,875,214	$	527,459	$	158,942	$	194,253	$	6,755,868

(1) Pension payments reflect 10 years of payments, through 2027.

As of December 31, 2016, Park had $14.3 million in unfunded commitments related to investments in qualified affordable housing projects which are not included in Table 36. Commitments are funded when capital calls are made by the general partner. Park expects that the current commitments will be funded between 2017 and 2027.

The Corporation’s operating lease obligations represent short-term and long-term lease and rental payments for facilities and equipment.  Purchase obligations represent obligations under agreements to purchase goods or services that are enforceable and legally binding on the Corporation.

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Commitments, Contingent Liabilities, and Off-Balance Sheet Arrangements: In order to meet the financing needs of our customers, the Corporation issues loan commitments and standby letters of credit. At December 31, 2016, the Corporation had $912.0 million of loan commitments for commercial, commercial real estate, and residential real estate loans and had $13.7 million of standby letters of credit. At December 31, 2015, the Corporation had $888.4 million of loan commitments for commercial, commercial real estate, and residential real estate loans and had $12.3 million of standby letters of credit.  

Commitments to extend credit under loan commitments and standby letters of credit do not necessarily represent future cash requirements.  These commitments often expire without being drawn upon.  However, all of the loan commitments and standby letters of credit were permitted to be drawn upon in 2016. See Note 23 of the Notes to Consolidated Financial Statements for additional information on loan commitments and standby letters of credit.

The Corporation did not have any unrecorded significant contingent liabilities at December 31, 2016.

Capital: Park’s primary means of maintaining capital adequacy is through retained earnings.  At December 31, 2016, the Corporation’s total shareholders’ equity was $742.2 million, compared to $713.4 million at December 31, 2015.  Total shareholders’ equity at December 31, 2016 was 9.94% of total assets, compared to 9.76% of total assets at December 31, 2015. 

Tangible shareholders’ equity was $669.9 million [total shareholders’ equity ($742.2 million) less goodwill ($72.3 million)] at December 31, 2016 and was $641.0 million [total shareholders’ equity ($713.4 million) less goodwill ($72.3 million)] at December 31, 2015.  At December 31, 2016, tangible shareholders’ equity was 9.06% of total tangible assets [total assets ($7,468 million) less goodwill ($72.3 million)], compared to 8.86% of total tangible assets [total assets ($7,311 million) less goodwill ($72.3 million)] at December 31, 2015.

Net income was $86.1 million in 2016, $81.0 million in 2015 and $84.0 million in 2014.

Cash dividends declared for Park's common shares were $58.0 million in 2016 and $57.9 million in each of 2015 and 2014.  On a per share basis, the cash dividends declared were $3.76 per share in each of 2016, 2015 and 2014.

The table below shows the repurchases and issuances of treasury shares for 2014 through 2016.

Table 37
(In thousands, except share data)	Treasury Shares			Number of Common Shares
Balance at January 1, 2014	$	(76,128	)	15,411,952
Cash payment for fractional shares in dividend reinvestment plan	—			(53	)
Treasury shares repurchased	(2,355		)	(29,700	)
Treasury shares reissued for director grants	1,044			10,200
Balance at December 31, 2014	$	(77,439	)	15,392,399
Cash payment for fractional shares in dividend reinvestment plan	—			(34	)
Treasury shares repurchased	(6,058		)	(71,700	)
Treasury shares reissued for director grants	1,024			10,150
Balance at December 31, 2015	$	(82,473	)	15,330,815
Cash payment for fractional shares in dividend reinvestment plan	—			(47	)
Treasury shares repurchased	—			—
Treasury shares reissued for director grants	1,001			9,950
Balance at December 31, 2016	$	(81,472	)	15,340,718

Park did not issue any new common shares, which it had not already held as treasury shares, in any of 2016, 2015 or 2014. Common shares had a balance of $305.8 million, $304.0 million, and $303.1 million at December 31, 2016, 2015, and 2014, respectively.

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Accumulated other comprehensive loss (net) was $17.7 million at December 31, 2016, compared to $15.6 million at December 31, 2015, and $13.6 million at December 31, 2014. During the 2016 year, the change in net unrealized holding gain (loss) on securities available for sale, net of income tax, was a loss of $2.7 million. During the 2015 year, the change in net unrealized holding gain (loss) on securities available for sale, net of income tax, was a loss of $1.5 million. During the 2014 year, the change in net unrealized holding gain (loss) on securities available for sale, net of income tax, was a gain of $31.1 million. Finally, Park recognized an other comprehensive gain of $611,000, net of income tax, related to the change in pension plan assets and benefit obligations in 2016, compared to an other comprehensive loss of $486,000, net of income tax, in 2015, and an other comprehensive loss of $9.3 million, net of income tax, in 2014.

Financial institution regulators have established guidelines for minimum capital ratios for banks, thrifts and bank holding companies. Park has elected not to include the net unrealized gain or loss on available-for-sale securities in computing regulatory capital. During the first quarter of 2015, Park adopted the Basel III regulatory capital framework as approved by the federal banking agencies. The adoption of this framework modified the calculation of the various capital ratios, added an additional ratio, common equity tier 1, and revised the adequately and well capitalized thresholds. Additionally, under this framework, in order to avoid limitations on capital distributions, including dividend payments, Park must hold a capital conservation buffer above the adequately capitalized risk-based capital ratios. The capital conservation buffer is being phased in from 0.0% for 2015 to 2.50% by 2019. The capital conservation buffer was 0.625% for 2016. The amounts shown below as the adequately capitalized ratio plus capital conservation buffer includes the fully phased-in 2.50% buffer.

PNB met each of the well-capitalized ratio guidelines at December 31, 2016. The following table indicates the capital ratios for PNB and Park at December 31, 2016 and December 31, 2015.

Table 38 - PNB and Park Capital Ratios
	As of December 31, 2016
	Leverage		Tier 1 Risk-Based		Common Equity Tier 1		Total Risk-Based
The Park National Bank	7.34	%	9.87	%	9.87	%	11.24	%
Park National Corporation	9.56	%	12.83	%	12.55	%	14.32	%
Adequately capitalized ratio	4.00	%	6.00	%	4.50	%	8.00	%
Adequately capitalized ratio plus capital conservation buffer	4.00	%	8.50	%	7.00	%	10.50	%
Well-capitalized ratio (PNB only)	5.00	%	8.00	%	6.50	%	10.00	%

	As of December 31, 2015
	Leverage		Tier 1 Risk-Based		Common Equity Tier 1		Total Risk-Based
The Park National Bank	7.06	%	9.83	%	9.83	%	11.37	%
Park National Corporation	9.22	%	12.82	%	12.54	%	14.49	%
Adequately capitalized ratio	4.00	%	6.00	%	4.50	%	8.00	%
Adequately capitalized ratio plus capital conservation buffer	4.00	%	8.50	%	7.00	%	10.50	%
Well-capitalized ratio (PNB only)	5.00	%	8.00	%	6.50	%	10.00	%

Effects of Inflation: Balance sheets of financial institutions typically contain assets and liabilities that are monetary in nature and, therefore, differ greatly from most commercial and industrial companies which have significant investments in premises, equipment and inventory.  During periods of inflation, financial institutions that are in a net positive monetary position will experience a decline in purchasing power, which does have an impact on growth.  Another significant effect on internal equity growth is other expenses, which tend to rise during periods of inflation.

Management believes the most significant impact on financial results is the Corporation's ability to align our asset/liability management program to react to changes in interest rates.

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SELECTED FINANCIAL DATA

Table 39 - Consolidated Five-Year Selected Financial Data
December 31, (Dollars in thousands, except per share data)	2016			2015		2014			2013		2012
Results of Operations:
Interest income	$	276,258		$	265,074	$	265,143		$	262,947	$	285,735
Interest expense	38,172			37,442		40,099			41,922		50,420
Net interest income	238,086			227,632		225,044			221,025		235,315
(Recovery of) provision for loan losses	(5,101		)	4,990		(7,333		)	3,415		35,419
Net interest income after (recovery of) provision for    loan losses	243,187			222,642		232,377			217,610		199,896
Gain on sale of the Vision business (1)	—			—		—			—		22,167
Non-interest income	78,731			77,551		75,549			73,277		70,236
Non-interest expense	199,023			186,614		187,510			181,515		181,127
Net income	86,135			81,012		83,957			76,869		78,480
Net income available to common shareholders	86,135			81,012		83,957			76,869		75,055
Per common share:
Net income per common share - basic	$	5.62		$	5.27	$	5.45		$	4.99	$	4.87
Net income per common share - diluted	5.59			5.26		5.45			4.99		4.87
Cash dividends declared	3.76			3.76		3.76			3.76		3.76
Average Balances:
Loans	$	5,122,862		$	4,909,579	$	4,717,297		$	4,514,781	$	4,410,661
Investment securities	1,504,667			1,478,208		1,432,692			1,377,887		1,613,131
Money market instruments and other	198,197			342,997		204,874			272,851		166,319
Total earning assets	6,825,726			6,730,784		6,354,863			6,165,519		6,190,111
Non-interest bearing deposits	1,414,885			1,311,628		1,196,625			1,117,379		1,048,796
Interest bearing deposits	4,165,919			4,155,196		3,820,928			3,742,361		3,786,601
Total deposits	5,580,804			5,466,824		5,017,553			4,859,740		4,835,397
Short-term borrowings	$	240,457		$	258,717	$	263,270		$	253,123	$	258,661
Long-term debt	776,465			793,469		867,615			870,538		907,704
Shareholders' equity	737,737			710,327		680,449			643,609		688,166
Common shareholders' equity	737,737			710,327		680,449			643,609		657,289
Total assets	7,416,519			7,306,460		6,893,302			6,701,049		6,765,240

Ratios:
Return on average assets (x)	1.16	%	1.11	%	1.22	%	1.15	%	1.11	%
Return on average common equity (x)	11.68	%	11.40	%	12.34	%	11.94	%	11.42	%
Net interest margin  (2)	3.52	%	3.39	%	3.55	%	3.61	%	3.83	%
Efficiency ratio (2)	62.34	%	60.98	%	62.21	%	61.40	%	55.00	%
Dividend payout ratio (3)	67.29	%	71.51	%	69.02	%	75.39	%	73.82	%
Average shareholders' equity to average total assets	9.95	%	9.72	%	9.87	%	9.60	%	10.17	%
Common equity tier 1 capital	12.55	%	12.54	%	N/A		N/A		N/A
Leverage capital	9.56	%	9.22	%	9.25	%	9.48	%	9.17	%
Tier 1 capital	12.83	%	12.82	%	13.39	%	13.27	%	13.12	%
Risk-based capital	14.32	%	14.49	%	15.14	%	15.91	%	15.77	%
(1) The Vision business was sold on February 16, 2012 for a gain on sale of $22.2 million.
(2) Calculated utilizing fully taxable equivalent net interest income which includes the effects of taxable equivalent adjustments using a 35% tax rate. The taxable equivalent adjustment was $2.4 million for 2016, $865,000 for 2015, $845,000 for 2014, $1.3 million for 2013 and $1.6 million for 2012.
(3) Cash dividends paid divided by net income.
(x) Reported measure uses net income available to common shareholders

33

The following table is a summary of selected quarterly results of operations for the years ended December 31, 2016 and 2015.

Table 40  -  Quarterly Financial Data
	Three Months Ended
(Dollars in thousands, except share data)	March 31		June 30		Sept. 30			Dec. 31
2016:
Interest income	$	69,308	$	67,011	$	68,242		$	71,697
Interest expense	9,489		9,526		9,709			9,448
Net interest income	59,819		57,485		58,533			62,249
Provision for (recovery of) loan losses	910		2,637		(7,366		)	(1,282		)
Income before income taxes	26,399		28,278		39,678			28,540
Net income	18,686		19,998		27,449			20,002
Per common share data:
Net income per common share -  basic	1.22		1.30		1.79			1.30
Net income per common share -  diluted	1.21		1.30		1.78			1.30
Weighted-average common shares outstanding - basic	15,330,813		15,330,802		15,330,791			15,337,806
Weighted-average common shares equivalent - diluted	15,406,508		15,399,283		15,399,707			15,415,132
2015:
Interest income	$	65,018	$	65,804	$	67,087		$	67,165
Interest expense	9,483		9,289		9,372			9,298
Net interest income	55,535		56,515		57,715			57,867
Provision for (recovery of) loan losses	1,632		1,612		2,404			(658		)
Income before income taxes	27,056		29,427		28,073			29,023
Net income	19,044		21,039		20,040			20,889
Per common share data:
Net income per common share -  basic	1.24		1.37		1.30			1.36
Net income per common share -  diluted	1.23		1.37		1.30			1.36
Weighted-average common shares outstanding - basic	15,379,170		15,370,882		15,361,087			15,345,986
Weighted-average common shares equivalent - diluted	15,421,928		15,407,881		15,401,808			15,384,451

34

Park's common shares (symbol: PRK) are traded on NYSE MKT.  At December 31, 2016, Park had 3,648 shareholders of record.  The following table sets forth the high, low and closing sale prices of, and dividends declared on the common shares for each quarterly period for the years ended December 31, 2016 and 2015, as reported by NYSE MKT.

Table 41  -  Market and Dividend Information
	High		Low		Last Price		Cash Dividend Declared Per Share
2016:
First Quarter	$	91.80	$	79.01	$	90.00	$	0.94
Second Quarter	95.45		85.35		91.78		0.94
Third Quarter	97.20		87.55		96.00		0.94
Fourth Quarter	122.88		94.05		119.66		0.94
2015:
First Quarter	$	88.39	$	79.46	$	85.56	$	0.94
Second Quarter	90.00		81.01		87.37		0.94
Third Quarter	90.92		80.15		90.22		0.94
Fourth Quarter	99.68		84.27		90.48		0.94

35

PERFORMANCE GRAPH

Table 42 compares the total return performance for Park's common shares with the Amex Composite, the NASDAQ Bank Stocks Index, SNL Financial Bank and Thrift Index, NYSE MKT Composite Index, and the SNL U.S. Bank NYSE Index for the five-year period from December 31, 2011 to December 31, 2016.  The Amex Composite Index is a market capitalization-weighted index made up of stocks that represent the NYSE Amex equities market.  The NASDAQ Bank Stocks Index is comprised of all depository institutions, holding companies and other investment companies that are traded on The NASDAQ Global Select, Global, and Capital Markets.  Park considers a number of bank holding companies traded on The NASDAQ Global Select Market to be within our peer group.  The SNL Financial Bank and Thrift Index is comprised of all publicly-traded bank holding company and thrift holding company stocks researched by SNL Financial. The NYSE MKT Composite Index is a market capitalization-weighted index of the stocks listed on NYSE MKT.  The SNL U.S. Bank NYSE index is comprised of all publicly-traded U.S. bank holding company stocks listed on NYSE MKT researched by SNL Financial.

The NYSE MKT Financial Stocks Index includes the stocks of bank holding companies, thrift holding companies, finance companies and securities broker-dealers.  Park believes that the NASDAQ Bank Stocks Index and the SNL Financial Bank and Thrift Index are more appropriate industry indices for Park to use for the five-year total return performance comparison.

Table 42 – Total Return Performance
	Period Ending
Index	12/31/11	12/31/12	12/31/13	12/31/14	12/31/15	12/31/16
Park National Corporation	100.00	105.06	145.44	158.85	169.56	233.37
Amex Composite	100.00	106.61	113.71	117.99	106.95	118.33
NASDAQ Bank Stocks	100.00	118.69	168.21	176.48	192.08	265.02
SNL Bank and Thrift Index	100.00	134.28	183.86	205.25	209.39	264.35
NYSE MKT Composite	100.00	116.15	146.80	156.87	150.64	168.63
SNL U.S. Bank NYSE	100.00	137.95	187.96	212.91	214.19	265.45

36

The annual compound total return on Park’s common shares for the past five years was a positive 18.5%.  By comparison, the annual compound total returns for the past five years on the Amex Composite, the NASDAQ Bank Stocks Index, the SNL Financial Bank and Thrift Index, the NYSE MKT Composite Index, and the SNL U.S. Bank NYSE Index were a positive 3.4%, a positive 21.5%, a positive 21.5%, a positive 11.0% and a positive 21.6%, respectively.

37

Management’s Report on Internal Control Over Financial Reporting

To the Board of Directors and Shareholders

Park National Corporation

The management of Park National Corporation (the “Corporation”) is responsible for establishing and maintaining adequate internal control over financial reporting, as defined in Rules 13a-15(f) and 15d-15(f) under the Securities Exchange Act of 1934, for the Corporation and its consolidated subsidiaries. The Corporation’s internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with U.S. generally accepted accounting principles. The Corporation’s internal control over financial reporting includes those policies and procedures that:

a) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Corporation and its consolidated subsidiaries;

b) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with U.S. generally accepted accounting principles, and that receipts and expenditures of the Corporation and its consolidated subsidiaries are being made only in accordance with authorizations of management and directors of the Corporation; and

c) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the assets of the Corporation and its consolidated subsidiaries that could have a material effect on the financial statements.

The Corporation’s internal control over financial reporting as it relates to the consolidated financial statements is evaluated for effectiveness by management and tested for reliability through a program of internal audits. Actions are taken to correct potential deficiencies as they are identified.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluations of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. Accordingly, even an effective system of internal control over financial reporting will provide only reasonable assurance with respect to financial statement preparation.

With the participation of our Chairman of the Board, our Chief Executive Officer and President and our Chief Financial

Officer, management evaluated the effectiveness of the Corporation’s internal control over financial reporting as of December 31, 2016, the end of the Corporation’s fiscal year. In making this assessment, management used the criteria set forth for effective internal control over financial reporting by the Committee of Sponsoring Organizations of the Treadway Commission's (COSO) 2013 Internal Control — Integrated Framework.

Based on our assessment under the criteria described in the immediately preceding paragraph, management concluded that the

Corporation maintained effective internal control over financial reporting as of December 31, 2016.

The Corporation’s independent registered public accounting firm, Crowe Horwath LLP, has audited the Corporation’s 2016 and 2015 consolidated financial statements included in this Annual Report and the Corporation’s internal control over financial reporting as of December 31, 2016, and has issued their Report of Independent Registered Public Accounting Firm, which appears in this Annual Report.

/s/ David L. Trautman	/s/ Brady T. Burt
David L. Trautman	Brady T. Burt
Chief Executive Officer and President	Chief Financial Officer, Secretary and Treasurer
February 21, 2017

38

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Shareholders

Park National Corporation

Newark, Ohio

We have audited the accompanying consolidated balance sheets of Park National Corporation and subsidiaries as of December 31, 2016 and 2015 and the related consolidated statements of income, comprehensive income, changes in shareholders’ equity and cash flows for each of the years in the three year period ended December 31, 2016. We also have audited Park National Corporation’s internal control over financial reporting as of December 31, 2016, based on criteria established in the 2013 Internal Control - Integrated Frameworkissued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Park National Corporation’s management is responsible for these financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on these financial statements and an opinion on the company's internal control over financial reporting based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement and whether effective internal control over financial reporting was maintained in all material respects. Our audits of the financial statements included examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.

A company's internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company's internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company's assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Park National Corporation and subsidiaries as of December 31, 2016 and 2015, and the results of their operations and their cash flows for each of the years in the three year period ended December 31, 2016, in conformity with accounting principles generally accepted in the United States of America. Also in our opinion, Park National Corporation maintained, in all material respects, effective internal control over financial reporting as of December 31, 2016, based on criteria established in the 2013 Internal Control - Integrated Frameworkissued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

Crowe Horwath LLP

Columbus, Ohio

February 21, 2017

39

Park National Corporation and Subsidiaries

Consolidated Balance Sheets

at December 31, 2016 and 2015

(In thousands, except share and per share data)	2016			2015
Assets
Cash and due from banks	$	122,811		$	119,412
Money market instruments	23,635			30,047
Cash and cash equivalents	146,446			149,459
Investment securities:
Securities available-for-sale, at fair value (amortized cost of $1,262,761 and $1,436,714 at December 31, 2016 and 2015, respectively)	1,258,139			1,436,266
Securities held-to-maturity, at amortized cost (fair value of $256,672 and $151,428 at December 31, 2016 and 2015, respectively)	259,833			149,302
Other investment securities	61,811			58,311
Total investment securities	1,579,783			1,643,879
Total loans	5,271,857			5,068,085
Allowance for loan losses	(50,624		)	(56,494		)
Net loans	5,221,233			5,011,591
Other assets:
Bank owned life insurance	185,234			181,684
Prepaid assets	88,874			80,635
Goodwill	72,334			72,334
Premises and equipment, net	57,971			59,493
Affordable housing tax credit investments	52,947			51,247
Accrued interest receivable	18,822			18,675
Other real estate owned	13,926			18,651
Mortgage loan servicing rights	9,266			9,008
Other	20,750			14,698
Total other assets	520,124			506,425
Total assets	$	7,467,586		$	7,311,354

The accompanying notes are an integral part of the consolidated financial statements.

F- 1

Park National Corporation and Subsidiaries

Consolidated Balance Sheets

at December 31, 2016 and 2015

(In thousands, except share and per share data)	2016			2015
Liabilities and shareholders’ equity
Deposits:
Non-interest bearing	$	1,523,417		$	1,404,032
Interest bearing	3,998,539			3,943,610
Total deposits	5,521,956			5,347,642
Short-term borrowings	394,795			394,242
Long-term debt	694,281			738,105
Subordinated notes	45,000			45,000
Total borrowings	1,134,076			1,177,347
Other liabilities:
Accrued interest payable	2,151			2,338
Unfunded commitments in affordable housing tax credit investments	14,282			20,311
Other	52,881			50,361
Total other liabilities	69,314			73,010
Total liabilities	6,725,346			6,597,999
Commitments and Contingencies
Shareholders’ equity:
Preferred shares (200,000 shares authorized; no shares outstanding at December 31, 2016 and 2015)	—			—
Common shares, no par value (20,000,000 shares authorized; 16,150,807 and 16,150,854 shares issued at December 31, 2016 and 2015, respectively)	305,826			303,966
Accumulated other comprehensive loss, net	(17,745		)	(15,643		)
Retained earnings	535,631			507,505
Less: Treasury shares (810,089 and 820,039 shares at December 31, 2016 and 2015, respectively)	(81,472		)	(82,473		)
Total shareholders’ equity	742,240			713,355
Total liabilities and shareholders’ equity	$	7,467,586		$	7,311,354

The accompanying notes are an integral part of the consolidated financial statements.

F- 2

Park National Corporation and Subsidiaries

Consolidated Statements of Income

for years ended December 31, 2016, 2015 and 2014

(In thousands, except per share data)	2016			2015			2014
Interest and dividend income:
Interest and fees on loans	$	241,979		$	227,979		$	227,644
Interest and dividends on:
Obligations of U.S. Government, its agencies and other securities	30,627			36,025			36,981
Obligations of states and political subdivisions	2,632			182			3
Other interest income	1,020			888			515
Total interest and dividend income	276,258			265,074			265,143
Interest expense:
Interest on deposits:
Demand and savings deposits	4,079			2,229			1,677
Time deposits	9,337			10,125			9,323
Interest on short-term borrowings	456			469			517
Interest on long-term debt	24,300			24,619			28,582
Total interest expense	38,172			37,442			40,099
Net interest income	238,086			227,632			225,044
(Recovery of) provision for loan losses	(5,101		)	4,990			(7,333		)
Net interest income after (recovery of) provision for loan losses	243,187			222,642			232,377
Other income:
Income from fiduciary activities	21,400			20,195			19,150
Service charges on deposit accounts	14,259			14,751			15,423
Other service income	14,419			11,438			10,459
Checkcard fee income	15,057			14,561			13,570
Bank owned life insurance income	4,338			5,783			4,861
ATM fees	2,268			2,428			2,467
Gain on sale of OREO, net	1,323			1,604			5,503
OREO valuation adjustments	(601		)	(1,592		)	(2,406		)
Gain on commercial loans held for sale	—			756			1,867
Gain (loss) on sale of investment securities	—			88			(1,158		)
Miscellaneous	6,268			7,539			5,813
Total other income	$	78,731		$	77,551		$	75,549

The accompanying notes are an integral part of the consolidated financial statements.

F- 3

Park National Corporation and Subsidiaries

Consolidated Statements of Income

for years ended December 31, 2016, 2015 and 2014

(In thousands, except per share data)	2016		2015		2014
Other expense:
Salaries	$	87,034	$	86,189	$	81,977
Employee benefits	19,262		21,296		19,991
Data processing fees	5,608		5,037		4,712
Professional fees and services	27,181		23,452		29,580
Occupancy expense	10,239		9,686		10,006
Furniture and equipment expense	13,766		11,806		11,571
Insurance	5,825		5,629		5,723
Marketing	4,523		3,983		4,371
Communication	4,985		5,130		5,268
State tax expense	3,560		3,566		2,290
OREO expense	1,021		1,446		2,063
Borrowing prepayment fee	5,554		532		—
Miscellaneous	10,465		8,862		9,958
Total other expense	199,023		186,614		187,510
Income before income taxes	122,895		113,579		120,416
Federal income taxes	36,760		32,567		36,459
Net income	$	86,135	$	81,012	$	83,957
Earnings per common share:
Basic	$	5.62	$	5.27	$	5.45
Diluted	$	5.59	$	5.26	$	5.45

The accompanying notes are an integral part of the consolidated financial statements.

F- 4

PARK NATIONAL CORPORATION

Consolidated Statements of Comprehensive Income

for years ended December 31, 2016, 2015 and 2014

(In thousands)	2016			2015			2014
Net income	$	86,135		$	81,012		$	83,957
Other comprehensive income (loss), net of income tax:
Defined benefit pension plan:
Amortization of net loss and prior service costs, net of income taxes of $271, $228, and $7, for the years ended December 31, 2016, 2015, and 2014, respectively	502			424			12
Unrealized net actuarial gain (loss), net of income tax expense (benefit) of $59, $(490), and $(4,997), for the years ended December 31, 2016, 2015, and 2014, respectively	109			(910		)	(9,279		)
Change in funded status of pension plan, net of income tax expense (benefit)	611			(486		)	(9,267		)
Securities available-for-sale:
Net loss realized on sale of securities, net of income taxes of $405, for the year ended December 31, 2014	—			—			753
Change in unrealized securities holding (loss) gain, net of income tax (benefit) expense of $(1,461), $(834), and $16,329, for the years ended December 31, 2016, 2015, and 2014, respectively	(2,713		)	(1,549		)	30,325
Unrealized net holding (loss) gain on securities available-for-sale, net of income tax (benefit) expense	(2,713		)	(1,549		)	31,078
Other comprehensive (loss) income	$	(2,102	)	$	(2,035	)	$	21,811
Comprehensive income	$	84,033		$	78,977		$	105,768

The accompanying notes are an integral part of the consolidated financial statements.

F- 5

Park National Corporation and Subsidiaries

Consolidated Statements of Changes in Shareholders’ Equity

for the years ended December 31, 2016, 2015 and 2014

	Preferred Shares			Common Shares					Retained Earnings			Treasury Shares			Accumulated Other Comprehensive (Loss) Income
(In thousands, except share and per share data)	Shares Outstanding	Amount		Shares Outstanding		Amount
Balance, January 1, 2014	—	$	—	15,411,952		$	302,651		$	458,719		$	(76,128	)	$	(35,419	)
Net income									83,957
Other comprehensive income, net of income tax															21,811
Cash dividends, $3.76 per share									(57,949		)
Cash payment for fractional shares in dividend reinvestment plan				(53	)	(5		)
Share-based compensation expense						458
Treasury shares repurchased				(29,700	)							(2,355		)
Treasury shares reissued for director grants				10,200					(243		)	1,044
Balance, December 31, 2014	—	$	—	15,392,399		$	303,104		$	484,484		$	(77,439	)	$	(13,608	)
Net income									81,012
Other comprehensive loss, net of income tax															(2,035		)
Cash dividends, $3.76 per share									(57,930		)
Cash payment for fractional shares in dividend reinvestment plan				(34	)	(3		)
Share-based compensation expense						865
Treasury shares repurchased				(71,700	)							(6,058		)
Treasury shares reissued for director grants				10,150					(61		)	1,024
Balance, December 31, 2015	—	$	—	15,330,815		$	303,966		$	507,505		$	(82,473	)	$	(15,643	)
Net income									86,135
Other comprehensive loss, net of income tax															(2,102		)
Cash dividends, $3.76 per share									(57,958		)
Cash payment for fractional shares in dividend reinvestment plan				(47	)	(4		)
Share-based compensation expense						1,864
Treasury shares reissued for director grants				9,950					(51		)	1,001
Balance, December 31, 2016	—	$	—	15,340,718		$	305,826		$	535,631		$	(81,472	)	$	(17,745	)

The accompanying notes are an integral part of the consolidated financial statements.

F- 6

Park National Corporation and Subsidiaries

Consolidated Statements of Cash Flows

for the years ended December 31, 2016, 2015 and 2014

(In thousands)	2016			2015			2014
Operating activities:
Net income	$	86,135		$	81,012		$	83,957
Adjustments to reconcile net income to net cash provided by operating activities:
(Recovery of) provision for loan losses	(5,101		)	4,990			(7,333		)
Amortization of loan fees and costs, net	7,332			6,440			4,160
Provision for depreciation	8,396			7,347			7,243
Amortization (accretion) of investment securities, net	247			(226		)	(213		)
Amortization of prepayment penalty on long-term debt	6,176			6,047			5,031
Prepayment penalty on long-term debt	5,554			532			—
Deferred income tax	581			(250		)	2,528
Realized net investment security (gains) losses	—			(88		)	1,158
Share-based compensation expense	2,814			1,828			1,259
Loan originations to be sold in secondary market	(287,722		)	(220,800		)	(136,125		)
Proceeds from sale of loans in secondary market	290,132			222,785			135,209
Gain on sale of loans in secondary market	(5,517		)	(4,027		)	(2,682		)
Gain on sale of commercial loans held for sale	—			(756		)	(1,867		)
OREO valuation adjustments	601			1,592			2,406
Gain on sale of OREO, net	(1,323		)	(1,604		)	(5,503		)
Bank owned life insurance income	(4,338		)	(5,783		)	(4,861		)
Changes in assets and liabilities:
Increase in other assets	(18,086		)	(10,978		)	(18,313		)
Increase in other liabilities	2,006			1,173			5,689
Net cash provided by operating activities	87,887			89,234			71,743
Investing activities:
Proceeds from redemption of Federal Home Loan Bank stock	—			—			8,946
Proceeds from sales of securities	—			3,144			173,123
Proceeds from calls and maturities of securities:
Held-to-maturity	29,901			36,393			41,436
Available-for-sale	753,325			321,146			99,092
Purchase of securities:
Held-to-maturity	(141,045		)	(48,226		)	—
Available-for-sale	(579,006		)	(457,617		)	(350,934		)
Net increase in other investments	(3,500		)	—			(1,350		)
Net loan originations, portfolio loans	(199,494		)	(247,882		)	(234,017		)
Proceeds from sale of commercial loans held for sale	—			900			20,966
Proceeds from the sale of OREO	8,704			17,058			27,798
Life insurance death benefits	1,050			6,340			2,221
Investment in qualified affordable housing projects	(15,029		)	(5,318		)	(9,417		)

F- 7

Park National Corporation and Subsidiaries
Consolidated Statements of Cash Flows
for the years ended December 31, 2016, 2015 and 2014
(In thousands)	2016			2015			2014
Purchases of bank owned life insurance, net	—			(10,045		)	—
Purchases of premises and equipment, net	(7,466		)	(11,361		)	(7,444		)
Net cash used in investing activities	(152,560		)	(395,468		)	(229,580		)
Financing activities
Net increase in deposits	174,314			219,642			338,006
Net increase in short-term borrowings	553			117,262			34,951
Proceeds from issuance of long-term debt	—			25,000			125,000
Repayment of subordinated notes	—			—			(35,250		)
Repayment of long-term debt	(55,554		)	(80,076		)	(153,970		)
Repurchase of treasury shares	—			(6,058		)	(2,355		)
Cash dividends paid	(57,653		)	(57,776		)	(57,876		)
Net cash provided by financing activities	61,660			217,994			248,506
(Decrease) increase in cash and cash equivalents	(3,013		)	(88,240		)	90,669
Cash and cash equivalents at beginning of year	149,459			237,699			147,030
Cash and cash equivalents at end of year	$	146,446		$	149,459		$	237,699
Cash paid for:
Interest	$	38,359		$	37,655		$	40,449
Income taxes	$	27,260		$	26,140		$	27,810
Non cash items:
Loans transferred to OREO	$	3,339		$	13,447		$	12,780
Transfers from loans to commercial loans held for sale	$	—		$	144		$	21,985
New commitments in affordable housing tax credit investments	$	9,000		$	9,000		$	8,000

The accompanying notes are an integral part of the consolidated financial statements.

F- 8

Notes to Consolidated Financial Statements

1. Summary of Significant Accounting Policies

The following is a summary of significant accounting policies followed in the preparation of the consolidated financial statements:

Principles of Consolidation

The consolidated financial statements include the accounts of Park National Corporation and its subsidiaries (“Park”, the “Company” or the “Corporation”). Material intercompany accounts and transactions have been eliminated.

Use of Estimates

The preparation of financial statements in conformity with U.S. generally accepted accounting principles ("GAAP") requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could differ from those estimates.

Reclassifications

Certain prior year amounts have been reclassified to conform with the current year presentation. These reclassifications had no impact on net income or shareholders' equity.

Restrictions on Cash and Due from Banks

The Corporation’s national bank subsidiary is required to maintain average reserve balances with the Federal Reserve Bank. The average required reserve balance was approximately $51.6 million at December 31, 2016 and $44.2 million at December 31, 2015. No other compensating balance arrangements were in existence at December 31, 2016.

Investment Securities

Investment securities are classified upon acquisition into one of three categories: held-to-maturity ("HTM"), available-for-sale ("AFS"), or trading (see Note 4 - Investment Securities).

HTM securities are those securities that the Corporation has the positive intent and ability to hold to maturity and are recorded at amortized cost. AFS securities are those securities that would be available to be sold in the future in response to the Corporation’s liquidity needs, changes in market interest rates, and asset-liability management strategies, among other reasons. AFS securities are reported at fair value, with unrealized holding gains and losses excluded from earnings but included in other comprehensive income (loss), net of applicable income taxes. The Corporation did not hold any trading securities during any period presented.

AFS and HTM securities are evaluated quarterly for potential other-than-temporary impairment. Management considers the facts related to each security including the nature of the security, the amount and duration of the loss, the credit quality of the issuer, the expectations for that security’s performance and whether Park intends to sell, or it is more likely than not that Park will be required to sell, a security in an unrealized loss position before recovery of its amortized cost basis. Declines in the value of equity securities that are considered to be other-than-temporary are recorded as a charge to earnings in the Consolidated Statements of Income. Declines in the value of debt securities that are considered to be other-than-temporary are separated into (1) the amount of the total impairment related to credit loss and (2) the amount of the total impairment related to all other factors. The amount of the total other-than-temporary impairment related to the credit loss is recognized in earnings. The amount of the total other-than-temporary impairment related to all other factors is recognized in other comprehensive income (loss), net of income tax.

Interest income from investment securities includes amortization of purchase premium or discount. Premiums and discounts on securities are amortized on the level-yield method without anticipating prepayments, except for mortgage-backed securities where prepayments are anticipated.

Gains and losses realized on the sale of investment securities are recorded on the trade date and determined using the specific identification basis.

F- 9

Notes to Consolidated Financial Statements

Federal Home Loan Bank ("FHLB") and Federal Reserve Bank ("FRB") Stock

Park’s national bank subsidiary, The Park National Bank ("PNB"), is a member of the FHLB. Additionally, PNB is a member of the FRB. Members are required to own a certain amount of stock based on their level of borrowings and other factors and may invest in additional amounts. FHLB stock and FRB stock are classified as restricted securities and are carried at their redemption value within other investment securities on the Consolidated Balance Sheets. Impairment is evaluated based on the ultimate recovery of par value. Both cash and stock dividends are reported as income.

Bank Owned Life Insurance

Park has purchased insurance policies on the lives of directors and certain key officers. Bank owned life insurance is recorded at its cash surrender value (or the amount that can be realized).

Loans Held for Sale

Generally, loans held for sale are carried at the lower of cost or fair value. Park has elected the fair value option for mortgage loans held for sale, which are carried at their fair value as of each balance sheet date.

Mortgage Banking Derivatives

Commitments to fund mortgage loans (interest rate locks) to be sold into the secondary market and forward commitments for the future delivery of these mortgage loans are accounted for as free standing derivatives. The fair values of these mortgage derivatives are estimated based on changes in mortgage interest rates from the date the interest rate on the loan is locked. The Company enters into forward commitments for the future delivery of mortgage loans when interest rate locks are entered into, in order to hedge the change in interest rates resulting from its commitments to fund the loans. Changes in the fair values of these derivatives are included in net gains on sale of loans.

Loans

Loans that management has the intent and ability to hold for the foreseeable future or until maturity or payoff, are reported at their outstanding principal balances adjusted for any charge-offs, any deferred fees or costs on originated loans, and any unamortized premiums or discounts on purchased loans. Interest income is accrued on the unpaid principal balance. Net deferred loan origination fees and costs are deferred and recognized in interest income using the level-yield method without anticipating prepayments.

Commercial loans include: (1) commercial, financial and agricultural loans; (2) commercial real estate loans; (3) those commercial loans in the real estate construction loan segment; and (4) those commercial loans in the residential real estate loan segment. Consumer loans include: (1) mortgage and installment loans included in the real estate construction segment; (2) mortgage, home equity lines of credit ("HELOCs"), and installment loans included in the residential real estate segment; and (3) all loans included in the consumer segment.

Generally, commercial loans are placed on nonaccrual status at 90 days past due and consumer and residential mortgage loans are placed on nonaccrual status at 120 days past due. Commercial loans placed on nonaccrual status are considered impaired (see Note 5 - Loans). For loans which are on nonaccrual status, it is Park’s policy to reverse interest previously accrued on the loans against interest income. Interest on such loans may be recorded on a cash basis and be included in earnings only when Park expects to receive the entire recorded investment of the loan. Park’s charge-off policy for commercial loans requires management to establish a specific reserve or record a charge-off as soon as it is apparent that the borrower is troubled and there is, or likely will be, a collateral shortfall related to the estimated value of the collateral securing the loan. The Company’s charge-off policy for consumer loans is dependent on the class of the loan. Residential mortgage loans, HELOCs, and consumer loans secured by residential real estate are typically charged down to the value of the collateral, less estimated selling costs, at 180 days past due. The charge-off policy for other consumer loans, primarily installment loans, requires a monthly review of delinquent loans and a complete charge-off for any account that reaches 120 days past due.

The delinquency status of a loan is based on contractual terms and not on how recently payments have been received. Loans may be removed from nonaccrual status when loan payments have been received to cure the delinquency status, the borrower has demonstrated the ability to maintain current payment status in accordance with the loan agreement and the loan is deemed to be well-secured by management.

A description of each segment of the loan portfolio, along with the risk characteristics of each segment, is included below:

Commercial, financial and agricultural:Commercial, financial and agricultural loans are made for a wide variety of general corporate purposes, including financing for commercial and industrial businesses, financing for equipment, inventories and accounts receivable, acquisition financing and commercial leasing. The term of each commercial loan varies by its purpose.

F- 10

Notes to Consolidated Financial Statements

Repayment terms are structured such that commercial loans will be repaid within the economic useful life of the underlying asset. The commercial loan portfolio includes loans to a wide variety of corporations and businesses across many industrial classifications originated in the 28 Ohio counties where PNB operates. The primary industries represented by these customers include manufacturing, retail trade, health care and other services.

Commercial real estate:Commercial real estate (“CRE”) loans include mortgage loans to developers and owners of commercial real estate. The lending policy for CRE loans is designed to address the unique risk attributes of CRE lending. The collateral for these CRE loans is the underlying commercial real estate.

Construction real estate: The Company defines construction loans as both commercial construction loans and residential construction loans where the loan proceeds are used exclusively for the improvement of real estate as to which the Company holds a mortgage. Construction loans may be in the form of a permanent loan or short-term construction loan, depending on the needs of the individual borrower. Construction financing is generally considered to involve a higher degree of risk of loss than long-term financing on improved, occupied real estate. Risk of loss on a construction loan depends largely upon the accuracy of the initial estimate of the property’s value at completion of construction and the estimated cost (including interest) of construction. If the estimate of construction cost proves to be inaccurate, the PNB division making the loan may be required to advance funds beyond the amount originally committed to permit completion of the project. If the estimate of value proves inaccurate, the PNB division may be confronted, at or prior to the maturity of the loan, with a project having a value insufficient to assure full repayment, should the borrower default. In the event that a default on a construction loan occurs and foreclosure follows, the PNB division must take control of the project and attempt to either arrange for completion of construction or dispose of the unfinished project. Additional risk exists with respect to loans made to developers who do not have a buyer for the property, as the developer may lack funds to pay the loan if the property is not sold upon completion. PNB and its divisions attempt to reduce such risks on loans to developers by requiring personal guarantees and reviewing current personal financial statements and tax returns as well as other projects undertaken by the developer.

Residential real estate:The Company defines residential real estate loans as first mortgages on individuals’ primary residences or second mortgages of individuals’ primary residences in the form of HELOCs or installment loans. Credit approval for residential real estate loans requires demonstration of sufficient income to repay the principal and interest and the real estate taxes and insurance, stability of employment, an established credit record and an appraised value of the real estate securing the loan.

Consumer:The Company originates direct and indirect consumer loans, primarily automobile loans, to customers in its primary market areas. Credit approval for consumer loans requires income sufficient to repay principal and interest due, stability of employment, an established credit record and sufficient collateral for secured loans. Consumer loans typically have shorter terms and lower balances with higher yields as compared to real estate mortgage loans, but generally carry higher risks of default. Consumer loan collections are dependent on the borrower’s financial stability, and thus are more likely to be affected by adverse personal circumstances.

Allowance for Loan Losses ("ALLL")

The allowance for loan losses is that amount believed adequate to absorb probable incurred credit losses in the loan portfolio based on management’s evaluation of various factors. The determination of the allowance requires significant estimates, including the timing and amounts of expected cash flows on impaired loans, consideration of current economic conditions, and historical loss experience pertaining to pools of homogeneous loans, all of which may be susceptible to change. The allowance is increased through a provision for loan losses that is charged to earnings based on management’s quarterly evaluation of the factors previously mentioned and is reduced by charge-offs, net of recoveries.

The allowance for loan losses includes both (1) an estimate of loss based on historical loss experience within both commercial and consumer loan categories with similar characteristics (“statistical allocation”) and (2) an estimate of loss based on an impairment analysis of each commercial loan that is considered to be impaired (“specific allocation”). Included in the statistical allocation is a reserve for troubled debt restructurings ("TDRs") within the consumer loan portfolio. Management performs a periodic evaluation to ensure the reserve calculated utilizing the statistical allocation is consistent with a reserve calculated under Accounting Standards Codification ("ASC") 310-10- Receivables.

F- 11

Notes to Consolidated Financial Statements

In calculating the allowance for loan losses, management believes it is appropriate to consider historical loss rates that are comparable to the current period being analyzed, giving consideration to losses experienced over a full cycle. For the historical loss factor at December 31, 2016, the Company utilized an annual loss rate (“historical loss experience”), calculated based on an average of the net charge-offs and the annual change in specific reserves for impaired commercial loans, experienced during 2010 through 2016 within the individual segments of the commercial and consumer loan categories. Management believes the 84-month historical loss experience methodology is appropriate in the current economic environment, as it captures loss rates consistent with current expectations based on current economic conditions.

The loss factor applied to Park’s consumer loan portfolio as of December 31, 2016 was based on the historical loss experience over the past 84 months, plus an additional judgmental reserve, increasing the total allowance for loan loss coverage in the consumer loan portfolio to approximately 1.95 years of historical losses. The consumer loan portfolio loss coverage ratio was 1.99 years at December 31, 2015. Historical loss experience over the past 84 months for the consumer loan portfolio was 0.34% for 2016 and 0.42% for 2015.

The loss factor applied to Park’s commercial loan portfolio as of December 31, 2016 was based on the historical loss experience over the past 84 months, plus additional reserves for consideration of (1) a loss emergence period factor, (2) a loss migration factor and (3) a judgmental or environmental loss factor. These additional reserves increased the total allowance for loan loss coverage in the commercial loan portfolio to approximately 3.20 years of historical losses at December 31, 2016. The commercial loan portfolio loss coverage ratio was 2.37 years at December 31, 2015. Historical loss experience over the past 84 months for the commercial loan portfolio was 0.39% for 2016 and 0.53% for 2015. Park’s commercial loans are individually risk graded. If loan downgrades occur, the probability of default increases and accordingly management allocates a higher percentage reserve to those accruing commercial loans graded special mention and substandard.

The judgmental increases discussed above incorporate management’s evaluation of the impact of environmental qualitative factors which pose additional risks and assign a component of the allowance for loan losses in consideration of these factors. Such environmental factors include: national and local economic trends and conditions; experience, ability and depth of lending management and staff; effects of any changes in lending policies and procedures; and levels of, and trends in, consumer bankruptcies, delinquencies, impaired loans and charge-offs and recoveries.

GAAP requires a specific allocation to be established as a component of the allowance for loan losses for certain loans when it is probable that all amounts due pursuant to the contractual terms of the loans will not be collected, and the recorded investment in the loans exceeds their measure of impairment. Management considers the following related to commercial loans when determining if a loan should be considered impaired: (1) current debt service coverage levels of the borrowing entity; (2) payment history over the most recent 12-month period; (3) other signs of deterioration in the borrower’s financial situation, such as changes in credit scores; and (4) consideration of global cash flows of financially sound guarantors that have previously supported loan payments. The recorded investment is the carrying balance of the loan, plus accrued interest receivable, both as of the end of the year. Impairment is measured using either the present value of expected future cash flows based upon the initial effective interest rate on the loan, or the fair value of the collateral. If a loan is considered to be collateral dependent, the fair value of collateral, less estimated selling costs, is used to measure impairment.

Troubled Debt Restructuring

Management classifies loans as TDRs when a borrower is experiencing financial difficulty and Park has granted a concession. In order to determine whether a borrower is experiencing financial difficulty, an evaluation is performed of the probability that the borrower will be in payment default on any of the borrower's debt in the foreseeable future without the modification. This evaluation is performed under the Company’s internal underwriting policy. Management’s policy is to modify loans by extending the term or by granting a temporary or permanent contractual interest rate below the market rate, not by forgiving debt. A court's discharge of a borrower's debt in a Chapter 7 bankruptcy is considered a concession when the borrower does not reaffirm the discharged debt. TDRs are separately identified for impairment disclosures and are measured at the present value of estimated future cash flows using the loan’s effective rate at inception. If a TDR is considered to be a collateral dependent loan, the loan is reported, net, at the fair value of the collateral.

Income Recognition

Income earned by the Corporation and its subsidiaries is recognized on the accrual basis of accounting, except for nonaccrual loans as previously discussed, and late charges on loans which are recognized as income when they are collected.

F- 12

Notes to Consolidated Financial Statements

Premises and Equipment

Land is carried at cost and is not subject to depreciation. Premises and equipment are carried at cost, less accumulated depreciation and amortization. Depreciation is generally provided on the straight-line method over the estimated useful lives of the related assets. Leasehold improvements are amortized over the shorter of the remaining lease period or the estimated useful lives of the improvements. Upon the sale or other disposal of an asset, the cost and related accumulated depreciation are removed from the accounts and the resulting gain or loss is recognized. Maintenance and repairs are charged to expense as incurred while renewals and improvements that extend the useful life of an asset are capitalized. Premises and equipment are evaluated for impairment whenever events or changes in circumstances indicate that the carrying amount of a particular asset may not be recoverable.

The range of depreciable lives over which premises and equipment are being depreciated are:

Buildings	30 Years
Equipment, furniture and fixtures	3 to 12 Years
Leasehold improvements	1 to 10 Years

Other Real Estate Owned ("OREO")

Management transfers a loan to OREO at the time that Park takes deed/title of the asset. OREO is initially recorded at fair value less anticipated selling costs (net realizable value), establishing a new cost basis, and consists of property acquired through foreclosure and real estate held for sale. If the net realizable value is below the carrying value of the loan at the date of transfer, the difference is charged to the allowance for loan losses. These assets are subsequently accounted for at the lower of cost or fair value less costs to sell. Subsequent changes in the value of real estate are classified as OREO valuation adjustments, are reported as adjustments to the carrying amount of OREO and are recorded within “Other income”. In certain circumstances where management believes the devaluation may not be permanent in nature, Park utilizes a valuation allowance to record OREO devaluations, which is also expensed through “Other income”. Costs relating to development and improvement of such properties are capitalized (not in excess of fair value less estimated costs to sell) and costs relating to holding the properties are charged to "Other expense".

Mortgage Servicing Rights ("MSR")

When Park sells mortgage loans with servicing rights retained, servicing rights are recorded at an amount not to exceed fair value with the income statement effect recorded in "Other service income." Capitalized servicing rights are amortized in proportion to and over the period of the estimated future servicing income of the underlying loan and are included within “Other service income”.

Mortgage servicing rights are assessed for impairment periodically, based on fair value, with any impairment recognized through a valuation allowance. The fair value of mortgage servicing rights is determined by discounting estimated future cash flows from the servicing assets, using market discount rates and expected future prepayment rates. In order to calculate fair value, the sold loan portfolio is stratified into homogeneous pools of like categories. (See Note 24 - Loan Servicing.)

Fees received for servicing mortgage loans owned by investors are based on a percentage of the outstanding monthly principal balance of such loans and are included in income as loan payments are received. The cost of servicing loans is charged to expense as incurred.

Goodwill

Goodwill represents the excess of the purchase price over net identifiable tangible and intangible assets acquired in a purchase business combination. Goodwill and indefinite-lived intangible assets are not amortized to expense, but are subject to impairment tests annually, or more frequently, if events or changes in circumstances indicate that the asset might be impaired, by assessing qualitative factors to determine whether the existence of events or circumstances leads to a determination that it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If after assessing these events or circumstances, it is concluded that it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, then performing the two-step impairment test is unnecessary. If the carrying amount of the goodwill exceeds the fair value, an impairment charge must be recorded in an amount equal to the excess.

F- 13

Notes to Consolidated Financial Statements

Management considers several factors when performing the annual impairment tests on goodwill. The factors considered include the operating results for the particular Park segment for the past year and the operating results budgeted for the current year (including multi-year projections), the deposit and loan totals of the Park segment and the economic conditions in the markets served by the Park segment. At December 31, 2016, the goodwill remaining on Park's Consolidated Balance Sheet consisted entirely of goodwill at PNB. (See Note 27 - Segment Information for operating segment results.)

Park evaluates goodwill for impairment on April 1 of each year, with financial data as of March 31. Based on the analysis performed as of April 1, 2016, the Company determined that goodwill for Park’s national bank subsidiary (PNB) was not impaired. There have been no subsequent circumstances or events triggering an additional evaluation.

Goodwill in the amount of $72.3 million was recorded at each of December 31, 2016, 2015, and 2014.

Consolidated Statement of Cash Flows

Cash and cash equivalents include cash and cash items, amounts due from banks and money market instruments. Generally, money market instruments are purchased and sold for one-day periods.

Loss Contingencies and Guarantees

Loss contingencies, including claims and legal actions arising in the ordinary course of business, are recorded as liabilities when the likelihood of loss is probable and an amount or range of loss can be reasonably estimated.

Income Taxes

The Corporation accounts for income taxes using the asset and liability approach. Under this method, deferred tax assets and liabilities are determined based on differences between financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. To the extent that Park does not consider it more likely than not that a deferred tax asset will be recovered, a valuation allowance is recorded. All positive and negative evidence is reviewed when determining how much of a valuation allowance is recognized on a quarterly basis. A valuation allowance, if needed, reduces deferred tax assets to the amount expected to be realized.

An uncertain tax position is recognized as a benefit only if it is “more-likely-than-not” that the tax position would be sustained in a tax examination being presumed to occur. The benefit recognized for a tax position that meets the “more-likely-than-not” criteria is measured based on the largest benefit that is more than 50 percent likely to be realized, taking into consideration the amounts and probabilities of the outcome upon settlement. For tax positions not meeting the “more-likely-than-not” test, no tax benefit is recorded. Park recognizes any interest and penalties related to income tax matters in income tax expense.

Treasury Shares

The purchase of Park’s common shares to be held in treasury is recorded at cost. At the date of retirement or subsequent reissuance, the treasury shares account is reduced by the weighted average cost of the common shares retired or reissued.

Comprehensive Income

Comprehensive income consists of net income and other comprehensive income (loss). Other comprehensive income (loss) includes unrealized gains and losses on securities available for sale, and changes in the funded status of the Company’s defined benefit pension plan, which are also recognized as separate components of equity.

Share-Based Compensation

Compensation cost is recognized for restricted stock units and stock awards issued to employees and directors, respectively, based on the fair value of these awards at the date of grant. The market price of Park’s common shares at the date of grant is used to estimate the fair value of restricted stock units and stock awards. Compensation cost is recognized over the required service period, generally defined as the vesting period and is recorded in "Salaries" expense. (See Note 17-Share-Based Compensation.)

Loan Commitments and Related Financial Instruments

Financial instruments include off‑balance sheet credit instruments, such as commitments to make loans and commercial letters of credit, issued to meet customer financing needs. The face amount for these items represents the exposure to loss, before considering customer collateral or ability to repay. Such financial instruments are recorded when they are funded.

F- 14

Notes to Consolidated Financial Statements

Fair Value Measurement

Fair values of financial instruments are estimated using relevant market information and other assumptions, as more fully disclosed in Note 25 - Fair Value. Fair value estimates involve uncertainties and matters of significant judgment regarding interest rates, credit risk, prepayments, and other factors, especially in the absence of broad markets for particular items. Changes in assumptions or in market conditions could significantly affect the estimates.

Transfers of Financial Assets

Transfers of financial assets are accounted for as sales, when control over the assets has been relinquished. Control over transferred assets is deemed to be surrendered when the assets have been isolated from the Company, the transferee obtains the right (free of conditions that constrain it from taking advantage of that right) to pledge or exchange the transferred assets, and the Company does not maintain effective control over the transferred assets through an agreement to repurchase them before their maturity.

Retirement Plans

Pension expense is the net of service and interest cost, return on plan assets and amortization of gains and losses not immediately recognized. Employee KSOP plan expense is the amount of matching contributions to Park's employees stock ownership plan. Deferred compensation and supplemental retirement plan expense allocates the benefits over years of service. (See Note 18 - Benefit Plans.)

Earnings Per Common Share

Basic earnings per common share is net income available to common shareholders divided by the weighted average number of common shares outstanding during the period. Diluted earnings per common share includes the dilutive effect of additional potential common shares issuable under stock awards, stock options, warrants and convertible securities. Earnings and dividends per common share are restated for any stock splits and stock dividends through the date of issuance of the consolidated financial statements. (See Note 21 - Earnings Per Common Share.)

Operating Segments

The Corporation is a financial holding company headquartered in Newark, Ohio. The operating segments for the Corporation are its chartered national bank subsidiary, PNB (headquartered in Newark, Ohio), SE Property Holdings, LLC ("SEPH"), and Guardian Financial Services Company ("GFSC").

2. Adoption of New Accounting Pronouncements and Issued Not Yet Effective Accounting Standards

ASU 2014-09 - Revenue from Contracts with Customers (Topic 606): In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606). The ASU creates a new topic, Topic 606, to provide guidance on revenue recognition for entities that enter into contracts with customers to transfer goods or services or enter into contracts for the transfer of nonfinancial assets. The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. Additional disclosures are required to provide quantitative and qualitative information regarding the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The new guidance is effective for annual reporting periods, and interim reporting periods within those annual periods, beginning after December 15, 2017. While interest income is specifically out of scope of this standard, management is currently evaluating the revenue streams within "Other income" to assess the applicability of this standard. Specifically, management is evaluating the impact of this new guidance on deposit fees recorded within "Service Charges on Deposit Accounts" and trust income within "Income from Fiduciary Activities."

ASU 2015-02 - Consolidation (Topic 810): Amendments to the Consolidation Analysis: In February 2015, the FASB issued ASU 2015-02, Consolidation (Topic 810): Amendments to the Consolidation Analysis. The ASU amends the current consolidation guidance and affect both the variable interest entity and voting interest entity consolidation models. The new guidance is effective for annual reporting periods and interim reporting periods within those annual periods, beginning after December 15, 2015. The adoption of this guidance on January 1, 2016 did not have an impact on Park’s consolidated financial statements.

F- 15

Notes to Consolidated Financial Statements

ASU 2016-01 - Financial Instruments - Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities. In January 2016, the FASB issued ASU 2016-01 - Financial Instruments - Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities. Changes to the current U.S. GAAP model primarily affect the accounting for equity investments, financial liabilities under the fair value option, and the presentation and disclosure requirements for financial instruments. In addition, the ASU clarifies guidance related to the valuation allowance assessment when recognizing deferred tax assets resulting from unrealized losses on available-for-sale securities. The new guidance is effective for annual reporting periods and interim reporting periods within those annual periods, beginning after December 15, 2017. The adoption of this guidance is not expected to have a material impact on Park's consolidated financial statements.

ASU 2016-02 - Leases (Topic 842): In February 2016, the FASB issued ASU 2016-02 - Leases (Topic 842). The ASU will require all organizations that lease assets to recognize on the balance sheet the assets and liabilities for the rights and obligations created by those leases. Additional qualitative and quantitative disclosures will be required so that users can understand more about the nature of an entity’s leasing activities. The new guidance is effective for annual reporting periods and interim reporting periods within those annual periods, beginning after December 15, 2018. Early adoption is permitted. Management is currently analyzing data on leased assets. The adoption of this guidance is expected to increase both assets and liabilities, but is not expected to have a material impact on Park's consolidated statement of income.

ASU 2016-09 - Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting: In March 2016, FASB issued ASU 2016-09 - Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting. The ASU provides simplification for several aspects of accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. The new guidance is effective for annual reporting periods and interim reporting periods within those annual periods, beginning after December 15, 2016. Early adoption was permitted. The adoption of this guidance on January 1, 2017 did not have a material impact on Park's consolidated financial statements.

ASU 2016-13 - Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments: In June 2016, FASB issued ASU 2016-13 - Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. The new guidance replaces the incurred loss model with an expected loss model, which is referred to as the current expected credit loss ("CECL") model. The CECL model is applicable to the measurement of credit losses on financial assets measured at amortized cost, including loan receivables, HTM debt securities, and reinsurance receivables. It also applies to off-balance sheet credit exposures not accounted for as insurance (loan commitments, standby letters of credit, financial guarantees, and other similar instruments) and net investments in leases recognized by a lessor. The CECL model requires an entity to estimate the credit losses over the life of an asset or off-balance sheet exposure. The new guidance is effective for annual reporting periods and interim reporting periods within those annual periods, beginning after December 15, 2019. Early adoption is permitted for annual reporting periods and interim reporting periods within those annual periods, beginning after December 15, 2018.

Management is currently evaluating the impact of the adoption of this guidance on Park's consolidated financial statements. We anticipate that the adoption of the CECL model will result in a material increase to Park's allowance for loan losses. Management has established a committee to oversee the implementation of CECL. This committee is currently assessing the data and system requirements necessary for adoption. Management plans to run our current model and a CECL model concurrently for 12 months prior to the adoption of this guidance on January 1, 2020.

ASU 2016-15 - Statement of Cash Flows (Topic 203): Classification of Certain Cash Receipts and Cash Payments (a consensus of the Emerging Issues Task Force):  In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 203): Classification of Certain Cash Receipts and Cash Payments (a consensus of the Emerging Issues Task Force).  This ASU provides guidance on eight specific cash flow issues where current GAAP is either unclear or does not include specific guidance. The new guidance is effective for annual reporting periods, and interim reporting periods within those annual periods, beginning after December 15, 2017.  As such transactions arise, management will utilize the updated guidance within Park’s consolidated statements of cash flows. 

F- 16

Notes to Consolidated Financial Statements

ASU 2017-04 - Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment:  In January 2017, the FASB issued ASU 2017-04, Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment. This ASU eliminates Step 2 from the goodwill impairment test. Instead, under the new guidance, an entity should perform its annual goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An impairment charge would be recognized for the amount by which the carrying amount exceeds the reporting unit's fair value. The new guidance is effective for annual reporting periods, and interim reporting periods within those annual periods, beginning after December 15, 2019. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The adoption of this guidance is not expected to have an impact on Park's consolidated financial statements.

3. Organization

Park National Corporation is a financial holding company headquartered in Newark, Ohio. Through its national bank subsidiary, PNB, Park is engaged in a general commercial banking and trust business, primarily in Ohio. PNB operates through eleven banking divisions with the Park National Bank Division headquartered in Newark, Ohio, the Fairfield National Bank Division headquartered in Lancaster, Ohio, The Park National Bank of Southwest Ohio & Northern Kentucky Division headquartered in Cincinnati, Ohio, the First-Knox National Bank Division headquartered in Mount Vernon, Ohio, the Farmers Bank Division headquartered in Loudonville, Ohio, the Security National Bank Division headquartered in Springfield, Ohio, the Unity National Bank Division headquartered in Piqua, Ohio, the Richland Bank Division headquartered in Mansfield, Ohio, the Century National Bank Division headquartered in Zanesville, Ohio, the United Bank, N.A. Division headquartered in Bucyrus, Ohio and the Second National Bank Division headquartered in Greenville, Ohio. A wholly-owned subsidiary of Park, GFSC is a consumer finance company located in Central Ohio.

Through February 16, 2012, Park operated a second banking subsidiary, Vision Bank ("Vision"), which was engaged in a general commercial banking business, primarily in Baldwin County, Alabama and the panhandle of Florida. Promptly following the sale of the Vision business to Centennial Bank (a wholly-owned subsidiary of HomeBanc Shares, Inc.), Vision surrendered its Florida banking charter to the Florida Office of Financial Regulation and became a non-bank Florida corporation. Vision (the Florida corporation) merged with and into a wholly-owned, non-bank subsidiary of Park, SEPH, with SEPH being the surviving entity. SEPH holds the remaining assets and liabilities retained by Vision subsequent to the sale. SEPH also holds OREO that had previously been transferred to SEPH from Vision. SEPH's assets consist primarily of performing and nonperforming loans and OREO. This segment represents a run off portfolio of the legacy Vision assets.

All of the Ohio-based banking divisions provide the following principal services: the acceptance of deposits for demand, savings and time accounts; commercial, industrial, consumer and real estate lending, including installment loans, credit cards, home equity lines of credit; trust services; cash management; safe deposit operations; electronic funds transfers and a variety of additional banking-related services. See Note 27 - Segment Information for financial information on the Corporation’s operating segments.

4. Investment Securities

The amortized cost and fair value of investment securities are shown in the following tables. Management performs a quarterly evaluation of investment securities for any other-than-temporary impairment. During 2016, 2015 and 2014, there were no investment securities deemed to be other-than-temporarily impaired.

F- 17

Notes to Consolidated Financial Statements

Investment securities at December 31, 2016 and December 31, 2015 were as follows:

(In thousands)	Amortized Cost		Gross Unrealized/Unrecognized Holding Gains		Gross Unrealized/Unrecognized Holding Losses		Estimated Fair Value
2016:
Securities Available-for-Sale
Obligations of U.S. Treasury and other U.S. Government sponsored entities	$	270,000	$	—	$	2,467	$	267,533
U.S. Government sponsored entities’ asset-backed securities	991,642		5,372		9,842		987,172
Other equity securities	1,119		2,315		—		3,434
Total	$	1,262,761	$	7,687	$	12,309	$	1,258,139
2016:
Securities Held-to-Maturity
Obligations of states and political subdivisions	$	188,622	$	977	$	5,148	$	184,451
U.S. Government sponsored entities’ asset-backed securities	71,211		1,097		87		72,221
Total	$	259,833	$	2,074	$	5,235	$	256,672

(In thousands)	Amortized Cost		Gross Unrealized/Unrecognized Holding Gains		Gross Unrealized/Unrecognized Holding Losses		Estimated Fair Value
2015:
Securities Available-for-Sale
Obligations of U.S. Treasury and other U.S. Government sponsored entities	$	527,605	$	—	$	5,542	$	522,063
U.S. Government sponsored entities’ asset-backed securities	907,989		8,776		5,272		911,493
Other equity securities	1,120		1,590		—		2,710
Total	$	1,436,714	$	10,366	$	10,814	$	1,436,266
2015:
Securities Held-to-Maturity
Obligations of states and political subdivisions	$	48,190	$	734	$	—	$	48,924
U.S. Government sponsored entities’ asset-backed securities	101,112		1,526		134		102,504
Total	$	149,302	$	2,260	$	134	$	151,428

Park’s U.S. Government sponsored entities' asset-backed securities consisted of 15-year mortgage-backed securities and collateralized mortgage obligations (CMOs). At December 31, 2016, the amortized cost of Park’s available-for-sale mortgage-backed securities was $545.1 million and there were no held-to-maturity mortgage-backed securities within Park's investment portfolio. At December 31, 2016, the amortized cost of Park's available-for-sale and held-to-maturity CMOs was $446.5 million and $71.2 million, respectively.

F- 18

Notes to Consolidated Financial Statements

The following table provides detail on investment securities with unrealized losses aggregated by investment category and length of time the individual securities had been in a continuous loss position at December 31, 2016 and December 31, 2015:

	Less than 12 Months				12 Months or Longer				Total
(In thousands)	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
2016:
Securities Available-for-Sale
Obligations of U.S. Treasury and other U.S. Government sponsored entities	$	247,695	$	2,305	$	19,838	$	162	$	267,533	$	2,467
U.S. Government sponsored entities' asset-backed securities	612,321		9,473		27,325		369		639,646		9,842
Total	$	860,016	$	11,778	$	47,163	$	531	$	907,179	$	12,309
2016:
Securities Held-to-Maturity
Obligations of states and political subdivisions	$	134,909	$	5,148	$	—	$	—	$	134,909	$	5,148
U.S. Government sponsored entities’ asset-backed securities	—		—		7,564		87		7,564		87
Total	$	134,909	$	5,148	$	7,564	$	87	$	142,473	$	5,235

	Less than 12 Months				12 Months or Longer				Total
(In thousands)	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
2015:
Securities Available-for-Sale
Obligations of U.S. Treasury and other U.S. Government sponsored entities	$	326,973	$	2,117	$	195,090	$	3,425	$	522,063	$	5,542
U.S. Government sponsored entities' asset-backed securities	384,169		2,776		114,543		2,496		498,712		5,272
Total	$	711,142	$	4,893	$	309,633	$	5,921	$	1,020,775	$	10,814
2015:
Securities Held-to-Maturity
U.S. Government sponsored entities' asset-backed securities	$	5,656	$	10	$	7,792	$	124	$	13,448	$	134

Management does not believe any individual unrealized loss as of December 31, 2016 or 2015 represented an other-than-temporary impairment. The unrealized losses on debt securities are primarily the result of interest rate changes. These conditions will not prohibit Park from receiving its contractual principal and interest payments on these debt securities. The fair value of these debt securities is expected to recover as payments are received on these securities and they approach maturity. Should the impairment of any of these securities become other-than-temporary, the cost basis of the investment will be reduced and the resulting loss recognized in net income in the period the other-than-temporary impairment is identified.

Other investment securities (as shown on the Consolidated Balance Sheets) consist of stock investments in the FHLB, the FRB and other equities carried at cost. The FHLB and FRB restricted stock investments are carried at their redemption value. Park owned $50.1 million of FHLB stock and $8.2 million of FRB stock at both December 31, 2016 and December 31, 2015. Park owned $3.5 million of other equities carried at cost at December 31, 2016 and carried no other equities held at cost at December 31, 2015.

F- 19

Notes to Consolidated Financial Statements

The amortized cost and estimated fair value of investments in debt securities at December 31, 2016, are shown in the following table by contractual maturity, except for asset-backed securities, which are shown as a single total, due to the unpredictability of the timing in principal repayments.

(In thousands)	Amortized Cost		Estimated Fair Value		Tax Equivalent Yield (1)
Securities Available-for-Sale
U.S. Treasury and other U.S. Government sponsored entities’ notes:
Due within one year	$	25,000	$	24,933	0.87	%
Due one through five years	245,000		242,600		1.22	%
Total	$	270,000	$	267,533	1.18	%
U.S. Government sponsored entities’ asset-backed securities	$	991,642	$	987,172	2.10	%
Securities Held-to-Maturity
Obligations of states and political subdivisions
Due greater than ten years	$	188,622	$	184,451	4.50	%
Total	$	188,622	$	184,451	4.50	%
U.S. Government sponsored entities’ asset-backed securities	$	71,211	$	72,221	3.31	%

 ⁽¹⁾ The tax equivalent yield for obligations of states and political subdivisions includes the effects of a taxable equivalent adjustment using a 35% rate. The taxable equivalent adjustment was $1.4 million for the year ended December 31, 2016.

All of Park’s securities shown in the above table as U.S. Treasury and other U.S. Government sponsored entities' notes are callable notes. These callable securities have a final maturity of 0.9 years to 3.5 years. The remaining weighted average life of the investment portfolio is 4.4 years.

At December 31, 2016, investment securities with an amortized cost of $343 million were pledged for government and trust department deposits, $569 million were pledged to secure repurchase agreements and $25 million were pledged as collateral for FHLB advance borrowings. At December 31, 2015, investment securities with an amortized cost of $429 million were pledged for government and trust department deposits, $622 million were pledged to secure repurchase agreements and $21 million were pledged as collateral for FHLB advance borrowings.

At December 31, 2016, there were no holdings of securities of any one issuer, other than the U.S. Government and its agencies, in an amount greater than 10% of shareholders’ equity.

During 2015, Park sold certain HTM investment securities with a book value of $3.1 million at a gain of $88,000. These securities had been paid down to 97.8% of the principal outstanding at acquisition. During 2014, Park sold certain AFS investment securities with a book value of $187,000 at a gain of $22,000. Additionally, Park sold certain AFS investment securities with a book value of $174.1 million at a loss of $1.2 million. No securities were sold during 2016.

F- 20

Notes to Consolidated Financial Statements

5. Loans

The composition of the loan portfolio, by class of loan, as of December 31, 2016 and December 31, 2015 was as follows:

	12/31/2016						12/31/2015
(In thousands)	Loan Balance		Accrued Interest Receivable		Recorded Investment		Loan Balance		Accrued Interest Receivable		Recorded Investment
Commercial, financial and agricultural *	$	994,619	$	3,558	$	998,177	$	955,727	$	3,437	$	959,164
Commercial real estate *	1,155,703		4,161		1,159,864		1,113,603		4,009		1,117,612
Construction real estate:
SEPH commercial land and development	—		—		—		2,044		—		2,044
Remaining commercial	135,343		398		135,741		128,046		321		128,367
Mortgage	48,699		106		48,805		36,722		75		36,797
Installment	4,903		17		4,920		6,533		21		6,554
Residential real estate:
Commercial	406,687		940		407,627		410,571		1,014		411,585
Mortgage	1,169,495		1,459		1,170,954		1,210,819		1,469		1,212,288
HELOC	212,441		853		213,294		211,415		769		212,184
Installment	19,874		67		19,941		22,638		78		22,716
Consumer	1,120,850		3,385		1,124,235		967,111		3,032		970,143
Leases	3,243		29		3,272		2,856		14		2,870
Total loans	$	5,271,857	$	14,973	$	5,286,830	$	5,068,085	$	14,239	$	5,082,324

* Included within commercial, financial and agricultural loans and commercial real estate loans is an immaterial amount of consumer loans that were not broken out by class.

Loans are shown net of deferred origination fees, costs and unearned income of $11.1 million at December 31, 2016 and $10.4 million at December 31, 2015, which represented a net deferred income position in both years.

Overdrawn deposit accounts of $2.9 million and $1.7 million had been reclassified to loans at December 31, 2016 and 2015, respectively, and are included in the commercial, financial and agricultural loan class above.

F- 21

Notes to Consolidated Financial Statements

Credit Quality

The following table presents the recorded investment in nonaccrual loans, accruing troubled debt restructurings ("TDRs"), and loans past due 90 days or more and still accruing by class of loan as of December 31, 2016 and December 31, 2015:

	12/31/2016
(In thousands)	Nonaccrual Loans		Accruing Troubled Debt Restructurings		Loans Past Due 90 Days or More and Accruing		Total Nonperforming Loans
Commercial, financial and agricultural	$	20,057	$	600	$	15	$	20,672
Commercial real estate	19,169		5,305		—		24,474
Construction real estate:
SEPH commercial land and development	—		—		—		—
Remaining commercial	1,833		393		—		2,226
Mortgage	—		104		—		104
Installment	61		95		12		168
Residential real estate:
Commercial	23,013		89		—		23,102
Mortgage	18,313		9,612		887		28,812
HELOC	1,783		673		25		2,481
Installment	644		609		60		1,313
Consumer	2,949		748		1,139		4,836
Total loans	$	87,822	$	18,228	$	2,138	$	108,188

	12/31/2015
(In thousands)	Nonaccrual Loans		Accruing Troubled Debt Restructurings		Loans Past Due 90 Days or More and Accruing		Total Nonperforming Loans
Commercial, financial and agricultural	$	21,676	$	8,947	$	—	$	30,623
Commercial real estate	15,268		2,757		—		18,025
Construction real estate:
SEPH commercial land and development	2,044		—		—		2,044
Remaining commercial	4,162		514		—		4,676
Mortgage	7		110		—		117
Installment	64		114		—		178
Residential real estate:
Commercial	25,063		261		—		25,324
Mortgage	20,378		10,143		851		31,372
HELOC	1,749		873		27		2,649
Installment	1,657		635		4		2,296
Consumer	3,819		734		1,093		5,646
Total loans	$	95,887	$	25,088	$	1,975	$	122,950

F- 22

Notes to Consolidated Financial Statements

The following table provides additional information regarding those nonaccrual and accruing TDR loans that are individually evaluated for impairment and those collectively evaluated for impairment as of December 31, 2016 and December 31, 2015.

	12/31/2016						12/31/2015
(In thousands)	Nonaccrual and accruing TDRs		Loans individually evaluated for impairment		Loans collectively evaluated for impairment		Nonaccrual and accruing TDRs		Loans individually evaluated for impairment		Loans collectively evaluated for impairment
Commercial, financial and agricultural	$	20,657	$	20,624	$	33	$	30,623	$	30,595	$	28
Commercial real estate	24,474		24,474		—		18,025		18,025		—
Construction real estate:
SEPH commercial land and development	—		—		—		2,044		2,044		—
Remaining commercial	2,226		2,226		—		4,676		4,676		—
Mortgage	104		—		104		117		—		117
Installment	156		—		156		178		—		178
Residential real estate:
Commercial	23,102		23,102		—		25,324		25,324		—
Mortgage	27,925		—		27,925		30,521		—		30,521
HELOC	2,456		—		2,456		2,622		—		2,622
Installment	1,253		—		1,253		2,292		—		2,292
Consumer	3,697		—		3,697		4,553		—		4,553
Total loans	$	106,050	$	70,426	$	35,624	$	120,975	$	80,664	$	40,311

All of the loans individually evaluated for impairment were evaluated using the fair value of the collateral or the present value of expected future cash flows as the measurement method.

F- 23

Notes to Consolidated Financial Statements

The following table presents loans individually evaluated for impairment by class of loan as of December 31, 2016 and December 31, 2015.

	12/31/2016						12/31/2015
(In thousands)	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	$	41,075	$	19,965	$	—	$	32,583	$	18,763	$	—
Commercial real estate	23,961		23,474		—		15,138		14,916		—
Construction real estate:
SEPH commercial land and development	—		—		—		10,834		2,044		—
Remaining commercial	3,662		2,226		—		2,506		1,531		—
Residential real estate:
Commercial	24,409		22,687		—		23,798		23,480		—
With an allowance recorded
Commercial, financial and agricultural	810		659		152		16,155		11,832		1,904
Commercial real estate	1,014		1,000		309		3,195		3,109		381
Construction real estate:
Remaining commercial	—		—		—		3,145		3,145		1,356
Residential real estate:
Commercial	427		415		87		1,951		1,844		550
Total	$	95,358	$	70,426	$	548	$	109,305	$	80,664	$	4,191

Management’s general practice is to proactively charge down loans individually evaluated for impairment to the fair value of the underlying collateral. At December 31, 2016 and December 31, 2015, there were $24.7 million and $24.2 million, respectively, of partial charge-offs on loans individually evaluated for impairment with no related allowance recorded and $177,000 and $4.5 million, respectively, of partial charge-offs on loans individually evaluated for impairment that also had a specific reserve allocated.

The allowance for loan losses included specific reserves related to loans individually evaluated for impairment at December 31, 2016 and 2015, of $0.5 million and $4.2 million, respectively. These loans with specific reserves had a recorded investment of $2.1 million and $19.9 million as of December 31, 2016 and 2015, respectively.

F- 24

Notes to Consolidated Financial Statements

Interest income on nonaccrual loans individually evaluated for impairment is recognized on a cash basis only when Park expects to receive the entire recorded investment of the loan. Interest income on accruing TDRs individually evaluated for impairment continues to be recorded on an accrual basis. The following tables present the average recorded investment and interest income recognized during the year subsequent to impairment on loans individually evaluated for impairment as of and for the years ended December 31, 2016, 2015, and 2014:

			Year ended December 31, 2016
(In thousands)	Recorded Investment as of December 31, 2016		Average recorded investment		Interest income recognized
Commercial, financial and agricultural	$	20,624	$	26,821	$	885
Commercial real estate	24,474		22,828		884
Construction real estate:
SEPH commercial land and development	—		1,597		—
Remaining commercial	2,226		3,906		66
Residential real estate:
Commercial	23,102		24,341		2,942
Consumer	—		3		—
Total	$	70,426	$	79,496	$	4,777

			Year ended December 31, 2015
(In thousands)	Recorded Investment as of December 31, 2015		Average recorded investment		Interest income recognized
Commercial, financial and agricultural	$	30,595	$	20,179	$	340
Commercial real estate	18,025		17,883		550
Construction real estate:
SEPH commercial land and development	2,044		2,066		21
Remaining commercial	4,676		5,666		26
Residential real estate:
Commercial	25,324		24,968		1,026
Consumer	—		—		—
Total	$	80,664	$	70,762	$	1,963

F- 25

Notes to Consolidated Financial Statements

			Year ended December 31, 2014
(In thousands)	Recorded Investment as of December 31, 2014		Average recorded investment		Interest income recognized
Commercial, financial and agricultural	$	19,106	$	19,518	$	360
Commercial real estate	21,989		31,945		1,027
Construction real estate:
SEPH commercial land and development	2,078		3,658		146
Remaining commercial	5,609		8,784		61
Residential real estate:
Commercial	24,930		28,306		1,084
Consumer	—		403		—
Total	$	73,712	$	92,614	$	2,678

The following tables present the aging of the recorded investment in past due loans as of December 31, 2016 and December 31, 2015 by class of loan.

	12/31/2016
(In thousands)	Accruing loans past due 30-89 days		Past due, nonaccrual loans and loans past due 90 days or more and accruing (1)		Total past due		Total current (2)		Total recorded investment
Commercial, financial and agricultural	$	371	$	4,113	$	4,484	$	993,693	$	998,177
Commercial real estate	355		2,499		2,854		1,157,010		1,159,864
Construction real estate:
SEPH commercial land and development	—		—		—		—		—
Remaining commercial	—		541		541		135,200		135,741
Mortgage	559		—		559		48,246		48,805
Installment	223		64		287		4,633		4,920
Residential real estate:
Commercial	330		3,631		3,961		403,666		407,627
Mortgage	10,854		9,769		20,623		1,150,331		1,170,954
HELOC	970		1,020		1,990		211,304		213,294
Installment	350		319		669		19,272		19,941
Consumer	12,579		2,094		14,673		1,109,562		1,124,235
Leases	—		—		—		3,272		3,272
Total loans	$	26,591	$	24,050	$	50,641	$	5,236,189	$	5,286,830

(1) Includes an aggregate of $2.1 million of loans past due 90 days or more and accruing. The remaining are past due, nonaccrual loans.

(2) Includes an aggregate of $65.9 million of nonaccrual loans which are current in regards to contractual principal and interest payments.

F- 26

Notes to Consolidated Financial Statements

	12/31/2015
(In thousands)	Accruing loans past due 30-89 days		Past due, nonaccrual loans and loans past due 90 days or more and accruing (1)		Total past due		Total current (2)		Total recorded investment
Commercial, financial and agricultural	$	670	$	7,536	$	8,206	$	950,958	$	959,164
Commercial real estate	142		530		672		1,116,940		1,117,612
Construction real estate:
SEPH commercial land and development	—		2,044		2,044		—		2,044
Remaining commercial	165		84		249		128,118		128,367
Mortgage	63		7		70		36,727		36,797
Installment	200		46		246		6,308		6,554
Residential real estate:
Commercial	325		19,521		19,846		391,739		411,585
Mortgage	10,569		8,735		19,304		1,192,984		1,212,288
HELOC	487		186		673		211,511		212,184
Installment	426		318		744		21,972		22,716
Consumer	11,458		3,376		14,834		955,309		970,143
Leases	—		—		—		2,870		2,870
Total loans	$	24,505	$	42,383	$	66,888	$	5,015,436	$	5,082,324

(1) Includes an aggregate of $2.0 million of loans past due 90 days or more and accruing. The remaining are past due, nonaccrual loans.

(2) Includes an aggregate of $55.5 million of nonaccrual loans which are current in regards to contractual principal and interest payments.

Credit Quality Indicators

Management utilizes past due information as a credit quality indicator across the loan portfolio. Past due information as of December 31, 2016 and 2015 is included in the tables above. The past due information is the primary credit quality indicator within the following classes of loans: (1) mortgage loans and installment loans in the construction real estate segment; (2) mortgage loans, HELOC and installment loans in the residential real estate segment; and (3) consumer loans. The primary credit indicator for commercial loans is based on an internal grading system that grades all commercial loans on a scale from 1 to 8. Credit grades are continuously monitored by the responsible loan officer and adjustments are made when appropriate. A grade of 1 indicates little or no credit risk and a grade of 8 is considered a loss. Commercial loans that are pass-rated (graded a 1 through a 4) are considered to be of acceptable credit risk. Commercial loans graded a 5 (special mention) are considered to be watch list credits and a higher loan loss reserve percentage is allocated to these loans. Loans classified as special mention have potential weaknesses that require management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or of Park’s credit position at some future date. Commercial loans graded a 6 (substandard), also considered watch list credits, are considered to represent higher credit risk and, as a result, a higher loan loss reserve percentage is allocated to these loans. Loans classified as substandard are inadequately protected by the current sound worth and paying capacity of the obligor or the value 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 Park will sustain some loss if the deficiencies are not corrected. Commercial loans graded a 7 (doubtful) are shown as nonaccrual and Park generally charges these loans down to their fair value by taking a partial charge-off or recording a specific reserve. Loans classified as doubtful have all the weaknesses inherent in those classified as substandard with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions, and values, highly questionable and improbable. Certain 6-rated loans and all 7-rated loans are placed on nonaccrual status and included within the impaired category. A loan is deemed impaired when management determines the borrower's ability to perform in accordance with the contractual loan agreement is in doubt. Any commercial loan graded an 8 (loss) is completely charged off.

F- 27

Notes to Consolidated Financial Statements

The tables below present the recorded investment by loan grade at December 31, 2016 and December 31, 2015 for all commercial loans:

	12/31/2016
(In thousands)	5 Rated		6 Rated		Impaired		Pass Rated		Recorded Investment
Commercial, financial and agricultural*	$	5,826	$	—	$	20,657	$	971,694	$	998,177
Commercial real estate*	7,548		190		24,474		1,127,652		1,159,864
Construction real estate:
SEPH commercial land and development	—		—		—		—		—
Remaining commercial	287		118		2,226		133,110		135,741
Residential real estate:
Commercial	1,055		124		23,102		383,346		407,627
Leases	—		—		—		3,272		3,272
Total Commercial Loans	$	14,716	$	432	$	70,459	$	2,619,074	$	2,704,681

* Included within commercial, financial and agricultural loans and commercial real estate loans is an immaterial amount of consumer loans that were not broken out by class.

	12/31/2015
(In thousands)	5 Rated		6 Rated		Impaired		Pass Rated		Recorded Investment
Commercial, financial and agricultural*	$	4,392	$	347	$	30,623	$	923,802	$	959,164
Commercial real estate*	14,880		3,417		18,025		1,081,290		1,117,612
Construction real estate:
SEPH commercial land and development	—		—		2,044		—		2,044
Remaining commercial	2,151		122		4,676		121,418		128,367
Residential real estate:
Commercial	3,280		386		25,324		382,595		411,585
Leases	—		—		—		2,870		2,870
Total Commercial Loans	$	24,703	$	4,272	$	80,692	$	2,511,975	$	2,621,642

* Included within commercial, financial and agricultural loans and commercial real estate loans is an immaterial amount of consumer loans that were not broken out by class.

Troubled Debt Restructuring

Management classifies loans as TDRs when a borrower is experiencing financial difficulties and Park has granted a concession to the borrower as part of a modification or in the loan renewal process. In order to determine whether a borrower is experiencing financial difficulty, an evaluation is performed of the probability that the borrower will be in payment default on any of the borrower's debt in the foreseeable future without the modification. This evaluation is performed in accordance with the Company’s internal underwriting policy. Management’s policy is to modify loans by extending the term or by granting a temporary or permanent contractual interest rate below the market rate, not by forgiving debt. A court's discharge of a borrower's debt in a Chapter 7 bankruptcy is considered a concession when the borrower does not reaffirm the discharged debt.

Certain loans which were modified during the years ended December 31, 2016 and December 31, 2015 did not meet the definition of a TDR as the modification was a delay in a payment that was considered to be insignificant. Management considers a forbearance period of up to three months or a delay in payment of up to 30 days to be insignificant. TDRs may be classified as accruing if the borrower has been current for a period of at least six months with respect to loan payments and management expects that the borrower will be able to continue to make payments in accordance with the terms of the restructured note. Management reviews all accruing TDRs quarterly to ensure payments continue to be made in accordance with the modified terms.

F- 28

Notes to Consolidated Financial Statements

Management reviews renewals/modifications of loans previously identified as TDRs to consider if it is appropriate to remove the TDR classification. If the borrower is no longer experiencing financial difficulty and the renewal/modification does not contain a concessionary interest rate or other concessionary terms, management considers the potential removal of the TDR classification. If deemed appropriate, the TDR classification is removed as the borrower has complied with the terms of the loan at the date of the renewal/modification and there was a reasonable expectation that the borrower would continue to comply with the terms of the loan subsequent to the date of the renewal/modification. The majority of these TDRs were originally considered restructurings in a prior year as a result of a renewal/modification with an interest rate that was not commensurate with the risk of the underlying loan at the time of the renewal/modification. During the years ended December 31, 2016 and 2015, Park removed the TDR classification on $2.7 million and $1.2 million, respectively, of loans that met the requirements discussed above.

At December 31, 2016 and 2015, there were $46.9 million and $41.1 million, respectively, of TDRs included in the nonaccrual loan totals. At December 31, 2016 and 2015, $38.0 million and $19.1 million, respectively, of these nonaccrual TDRs were performing in accordance with the terms of the restructured note. As of December 31, 2016 and 2015, loans with a recorded investment of $18.2 million and $25.1 million, respectively, were included in accruing TDR loan totals. Management will continue to review the restructured loans and may determine it appropriate to move certain nonaccrual TDRs to accrual status in the future.

At December 31, 2016 and 2015, Park had commitments to lend $0.7 million and $2.3 million, respectively, of additional funds to borrowers whose outstanding loan terms had been modified in a TDR.

The specific reserve related to TDRs at December 31, 2016 and 2015 was $0.2 million and $2.3 million, respectively. Modifications made in 2015 and 2016 were largely the result of renewals and extending the maturity date of the loan, at terms consistent with the original note. These modifications were deemed to be TDRs primarily due to Park’s conclusion that the borrower would likely not have qualified for similar terms through another lender. Many of the modifications deemed to be TDRs were previously identified as impaired loans, and thus were also previously evaluated for impairment under ASC 310.  Additional specific reserves of $1.0 million were recorded during the year ended December 31, 2016, as a result of TDRs identified in the 2016 year. Additional specific reserves of $1.3 million were recorded during the year ended December 31, 2015 as a result of TDRs identified in the 2015 year. Additional specific reserves of $0.7 million were recorded during the year ended December 31, 2014 as a result of TDRs identified in the 2014 year.

The terms of certain other loans were modified during the years ended December 31, 2016 and 2015 that did not meet the definition of a TDR. Modified substandard commercial loans which did not meet the definition of a TDR had a total recorded investment as of December 31, 2016 and 2015 of $26,000 and $116,000, respectively. The renewal/modification of these loans: (1) resulted in a delay in a payment that was considered to be insignificant, or (2) resulted in Park obtaining additional collateral or guarantees that improved the likelihood of the ultimate collection of the loan such that the modification was deemed to be at market terms.  Modified consumer loans which did not meet the definition of a TDR had a total recorded investment as of December 31, 2016 and 2015 of $7.4 million and $16.5 million, respectively. Many of these loans were to borrowers who were not experiencing financial difficulties but who were looking to reduce their cost of funds.

F- 29

Notes to Consolidated Financial Statements

The following tables detail the number of contracts modified as TDRs during the years ended December 31, 2016, 2015 and 2014 as well as the recorded investment of these contracts at December 31, 2016, 2015, and 2014. The recorded investment pre- and post-modification is generally the same due to the fact that Park does not typically forgive principal.

	Year ended December 31, 2016
(In thousands)	Number of Contracts	Accruing		Nonaccrual		Recorded Investment
Commercial, financial and agricultural	32	$	191	$	8,450	$	8,641
Commercial real estate	14	3,844		2,537		6,381
Construction real estate:
SEPH commercial land and development	—	—		—		—
Remaining commercial	2	—		1,143		1,143
Mortgage	—	—		—		—
Installment	1	—		—		—
Residential real estate:
Commercial	11	89		1,033		1,122
Mortgage	34	114		2,292		2,406
HELOC	13	104		178		282
Installment	5	102		3		105
Consumer	293	184		994		1,178
Total loans	405	$	4,628	$	16,630	$	21,258

	Year ended December 31, 2015
(In thousands)	Number of Contracts	Accruing		Nonaccrual		Recorded Investment
Commercial, financial and agricultural	39	$	8,948	$	3,640	$	12,588
Commercial real estate	14	637		3,523		4,160
Construction real estate:
SEPH commercial land and development	—	—		—		—
Remaining commercial	2	513		—		513
Mortgage	1	19		—		19
Installment	—	—		—		—
Residential real estate:
Commercial	11	—		1,185		1,185
Mortgage	39	1,132		2,122		3,254
HELOC	26	315		45		360
Installment	9	—		155		155
Consumer	283	202		888		1,090
Total loans	424	$	11,766	$	11,558	$	23,324

F- 30

Notes to Consolidated Financial Statements

	Year ended December 31, 2014
(In thousands)	Number of Contracts	Accruing		Nonaccrual		Recorded Investment
Commercial, financial and agricultural	30	$	292	$	431	$	723
Commercial real estate	11	1,184		1,254		2,438
Construction real estate:
SEPH commercial land and development	—	—		—		—
Remaining commercial	2	—		206		206
Mortgage	—	—		—		—
Installment	2	—		56		56
Residential real estate:
Commercial	9	—		866		866
Mortgage	46	32		2,325		2,357
HELOC	10	85		241		326
Installment	10	109		12		121
Consumer	330	244		1,058		1,302
Total loans	450	$	1,946	$	6,449	$	8,395

Of those loans which were modified and determined to be a TDR during the year ended December 31, 2016, $9.4 million were on nonaccrual status as of December 31, 2015. Of those loans which were modified and determined to be a TDR during the year ended December 31, 2015, $0.8 million were on nonaccrual status as of December 31, 2014. Of those loans which were modified and determined to be a TDR during the year ended December 31, 2014, $0.7 million were on nonaccrual status as of December 31, 2013.

The following table presents the recorded investment in financing receivables which were modified as TDRs within the previous 12 months and for which there was a payment default during the year ended December 31, 2016, December 31, 2015, and December 31, 2014. For this table, a loan is considered to be in default when it becomes 30 days contractually past due under the modified terms. The additional allowance for loan loss resulting from the defaults on TDR loans was immaterial.

	Year ended December 31, 2016			Year ended December 31, 2015				Year ended December 31, 2014
(In thousands)	Number of Contracts	Recorded Investment		Number of Contracts		Recorded Investment		Number of Contracts	Recorded Investment
Commercial, financial and agricultural	7	$	419	1		$	1	4	$	206
Commercial real estate	5	843		1		626		1	302
Construction real estate:
SEPH commercial land and development	—	—		—		—		—	—
Remaining commercial	—	—		—		—		—	—
Mortgage	—	—		—		—		—	—
Installment	—	—		—		—		—	—
Residential real estate:
Commercial	7	848		3		1,005		1	3
Mortgage	15	1,201		12		682		14	810
HELOC	—	—		1		5		2	160
Installment	1	3		2		101		2	12
Consumer	62	484		47		434		62	516
Leases	—	—		—		—		—	—
Total loans	97	$	3,798	$	67	$	2,854	86	$	2,009

F- 31

Notes to Consolidated Financial Statements

Of the $3.8 million in modified TDRs which defaulted during the year ended December 31, 2016, $111,000 were accruing loans and $3.7 million were nonaccrual loans. Of the $2.9 million in modified TDRs which defaulted during the year ended December 31, 2015, $44,000 were accruing loans and $2.8 million were nonaccrual loans. Of the $2.0 million in modified TDRs which defaulted during the year ended December 31, 2014, $314,000 were accruing loans and $1.7 million were nonaccrual loans.

Certain of the Corporation’s executive officers, directors and related entities of directors are loan customers of PNB. As of December 31, 2016 and 2015, credit exposure aggregating approximately $43.4 million and $47.0 million, respectively, was outstanding to such parties. Of this total exposure, approximately $29.6 million and $36.0 million was outstanding at December 31, 2016 and 2015, respectively, with the remaining balance representing available credit. During 2016, new loans and advances on existing loans were made to these executive officers, directors and related entities of directors totaling $5.4 million and $3.5 million, respectively. These extensions of credit were offset by principal payments of $15.3 million. During 2015, new loans and advances on existing loans were $5.8 million and $7.1 million, respectively. These extensions of credit were offset by principal payments of $12.9 million.

6. Allowance for Loan Losses

The allowance for loan losses is that amount management believes is adequate to absorb probable incurred credit losses in the loan portfolio based on management’s evaluation of various factors including the overall growth in the loan portfolio, an analysis of individual loans, prior and current loss experience, and current economic conditions. A provision for loan losses is charged to operations based on management’s periodic evaluation of these and other pertinent factors as discussed within Note 1 - Summary of Significant Accounting Policies.

Loss factors are reviewed quarterly and updated at least annually to reflect recent loan loss history and incorporate current risk and trends which may not be recognized in historical data. Several enhancements were made in the third quarter of 2016 as a result of management's quarterly review.

• Management updated the historical loss calculation during the third quarter of 2016, incorporating annualized net charge-offs plus changes in specific reserves through September 30, 2016. Additionally, management removed from the historical loss calculation net charge-offs plus changes in specific reserves for the year ended December 31, 2009. Management's belief has been that historical losses should encompass the complete economic cycle. However, given the extended length of the economic recovery, management determined that 2009 loss data was no longer reflective of the current portfolio. Management has taken the look-back period into consideration in the quarterly evaluation of environmental loss factors.

As part of the 2016 mid-year historical loss update, management determined that it was no longer appropriate to more heavily weight those years with higher losses in the historical loss calculation and applied equal percentages to each of the years in this calculation. The trends that existed resulting in management applying different weightings to years within the historical loss calculation no longer appeared to exist, resulting in the adjustment back to equal weightings.

• As part of the normal quarterly process, management reviewed and updated the environmental loss factors applied to the commercial portfolio in order to incorporate changes in the macroeconomic environment. Additionally, management updated the calculation of the loss emergence period utilizing a more granular process.

The impact of the changes described above resulted in a decrease of $3.8 million in the ALLL at September 30, 2016, compared to what the ALLL would have been had the calculation, and related assumptions, used at June 30, 2016 remained constant.

The loss factors were updated in the fourth quarter of 2016 to incorporate losses through December 31, 2016.

F- 32

Notes to Consolidated Financial Statements

The activity in the allowance for loan losses for the years ended December 31, 2016, 2015, and 2014 is summarized in the following tables.

	Year ended December 31, 2016
(In thousands)	Commercial, financial and agricultural			Commercial real estate			Construction real estate			Residential real estate			Consumer			Leases			Total
Allowance for credit losses:
Beginning balance	$	13,694		$	9,197		$	8,564		$	13,514		$	11,524		$	1		$	56,494
Charge-offs	5,786			412			1,436			3,014			10,151			—			20,799
Recoveries	(1,259		)	(3,671		)	(8,559		)	(2,446		)	(4,094		)	(1		)	(20,030		)
Net charge-offs (recoveries)	4,527			(3,259		)	(7,123		)	568			6,057			(1		)	769
Provision (Recovery)	4,267			(2,024		)	(10,440		)	(1,988		)	5,086			(2		)	(5,101		)
Ending balance	$	13,434		$	10,432		$	5,247		$	10,958		$	10,553		—			$	50,624

	Year ended December 31, 2015
(In thousands)	Commercial, financial and agricultural			Commercial real estate			Construction real estate			Residential real estate			Consumer			Leases			Total
Allowance for credit losses:
Beginning balance	$	10,719		$	8,808		$	8,652		$	14,772		$	11,401		$	—		$	54,352
Charge-offs	2,478			348			470			2,352			8,642			—			14,290
Recoveries	(1,373		)	(2,241		)	(2,092		)	(2,438		)	(3,295		)	(3		)	(11,442		)
Net charge-offs (recoveries)	1,105			(1,893		)	(1,622		)	(86		)	5,347			(3		)	2,848
Provision (Recovery)	4,080			(1,504		)	(1,710		)	(1,344		)	5,470			(2		)	4,990
Ending balance	$	13,694		$	9,197		$	8,564		$	13,514		$	11,524		$	1		$	56,494

	Year ended December 31, 2014
(In thousands)	Commercial, financial and agricultural			Commercial real estate			Construction real estate			Residential real estate			Consumer			Leases			Total
Allowance for credit losses:
Beginning balance	$	14,218		$	15,899		$	6,855		$	14,251		$	8,245		$	—		$	59,468
Charge-offs	3,779			8,003			1,316			3,944			7,738			—			24,780
Recoveries	(1,003		)	(7,759		)	(12,572		)	(2,985		)	(2,671		)	(7		)	(26,997		)
Net charge-offs (recoveries)	2,776			244			(11,256		)	959			5,067			(7		)	(2,217		)
(Recovery) Provision	(723		)	(6,847		)	(9,459		)	1,480			8,223			(7		)	(7,333		)
Ending balance	$	10,719		$	8,808		$	8,652		$	14,772		$	11,401		$	—		$	54,352

Loans collectively evaluated for impairment in the following tables include all performing loans at December 31, 2016 and 2015, as well as nonperforming loans internally classified as consumer loans. Nonperforming consumer loans are not typically individually evaluated for impairment, but receive a portion of the statistical allocation of the allowance for loan losses. Loans individually evaluated for impairment include all impaired loans internally classified as commercial loans at December 31, 2016 and 2015, which are evaluated for impairment in accordance with GAAP (see Note 1 - Summary of Significant Accounting Policies).

F- 33

Notes to Consolidated Financial Statements

The composition of the allowance for loan losses at December 31, 2016 and 2015 was as follows: 

	December 31, 2016
(In thousands)	Commercial, financial, and agricultural			Commercial real estate			Construction real estate			Residential real estate			Consumer			Leases			Total
Allowance for loan losses:
Ending allowance balance attributed to loans
Individually evaluated for impairment	$	152		$	309		$	—		$	87		$	—		$	—		$	548
Collectively evaluated for impairment	13,282			10,123			5,247			10,871			10,553			—			50,076
Total ending allowance balance	$	13,434		$	10,432		$	5,247		$	10,958		$	10,553		$	—		$	50,624
Loan Balance:
Loans individually evaluated for impairment	$	20,622		$	24,465		$	2,226		$	23,102		$	—		$	—		$	70,415
Loans collectively evaluated for impairment	973,997			1,131,238			186,719			1,785,395			1,120,850			3,243			5,201,442
Total ending loan balance	$	994,619		$	1,155,703		$	188,945		$	1,808,497		$	1,120,850		$	3,243		$	5,271,857
Allowance for loan losses as a percentage of loan balance:
Loans individually evaluated for impairment	0.74		%	1.26		%	—		%	0.38		%	—		%	—		%	0.78		%
Loans collectively evaluated for impairment	1.36		%	0.89		%	2.81		%	0.61		%	0.94		%	—		%	0.96		%
Total	1.35		%	0.90		%	2.78		%	0.61		%	0.94		%	—		%	0.96		%
Recorded Investment:
Loans individually evaluated for impairment	$	20,624		$	24,474		$	2,226		$	23,102		$	—		$	—		$	70,426
Loans collectively evaluated for impairment	977,553			1,135,390			187,240			1,788,714			1,124,235			3,272			5,216,404
Total ending recorded investment	$	998,177		$	1,159,864		$	189,466		$	1,811,816		$	1,124,235		$	3,272		$	5,286,830

F- 34

Notes to Consolidated Financial Statements

	December 31, 2015
(In thousands)	Commercial, financial, and agricultural			Commercial real estate			Construction real estate			Residential real estate			Consumer			Leases			Total
Allowance for loan losses:
Ending allowance balance attributed to loans
Individually evaluated for impairment	$	1,904		$	381		$	1,356		$	550		$	—		$	—		$	4,191
Collectively evaluated for impairment	11,790			8,816			7,208			12,964			11,524			1			52,303
Total ending allowance balance	$	13,694		$	9,197		$	8,564		$	13,514		$	11,524		$	1		$	56,494
Loan Balance:
Loans individually evaluated for impairment	$	30,545		$	18,015		$	6,716		$	25,323		$	—		$	—		$	80,599
Loans collectively evaluated for impairment	925,182			1,095,588			166,629			1,830,120			967,111			2,856			4,987,486
Total ending loan balance	$	955,727		$	1,113,603		$	173,345		$	1,855,443		$	967,111		$	2,856		$	5,068,085
Allowance for loan losses as a percentage of loan balance:
Loans individually evaluated for impairment	6.23		%	2.11		%	20.19		%	2.17		%	—		%	—		%	5.20		%
Loans collectively evaluated for impairment	1.27		%	0.80		%	4.33		%	0.71		%	1.19		%	0.04		%	1.05		%
Total	1.43		%	0.83		%	4.94		%	0.73		%	1.19		%	0.04		%	1.11		%
Recorded Investment:
Loans individually evaluated for impairment	$	30,595		$	18,025		$	6,720		$	25,324		$	—		$	—		$	80,664
Loans collectively evaluated for impairment	928,569			1,099,587			167,042			1,833,449			970,143			2,870			5,001,660
Total ending recorded investment	$	959,164		$	1,117,612		$	173,762		$	1,858,773		$	970,143		$	2,870		$	5,082,324

7. Loans Held for Sale

Mortgage loans held for sale are carried at their fair value. Mortgage loans held for sale were $10.4 million and $7.3 million at December 31, 2016 and 2015, respectively. These amounts are included in loans on the Consolidated Balance Sheets and in the residential real estate loan segments in Note 5 - Loans and Note 6 - Allowance for Loan Losses. The contractual balance was $10.3 million and $7.2 million at December 31, 2016 and 2015, respectively. The gain expected upon sale was $131,000 and $95,000 at December 31, 2016 and 2015, respectively. None of these loans were 90 days or more past due or on nonaccrual status as of December 31, 2016 or 2015.

During 2015, Park transferred to held for sale and sold certain commercial loans previously held for investment with a book balance of $144,000, and recognized a gain of $756,000. During 2014, Park transferred certain commercial loans held for investment, with a book balance of $22.0 million, to the loans held for sale portfolio, and subsequently completed the sale of these commercial loans held for sale, recognizing a net gain on sale of $1.9 million. No commercial loans were held for sale or sold during 2016.

F- 35

Notes to Consolidated Financial Statements

8. Other Real Estate Owned

The carrying amount of foreclosed properties held at December 31, 2016 and December 31, 2015 are listed below, as well as the recorded investment of loans secured by residential real estate properties for which formal foreclosure proceedings were in process at those dates.

(In thousands)	December 31, 2016		December 31, 2015
OREO:
Commercial real estate	$	7,642	$	8,333
Construction real estate	4,624		7,259
Residential real estate	1,660		3,059
Total OREO	$	13,926	$	18,651
Loans in process of foreclosure:
Residential real estate	$	3,250	$	2,021

9. Premises and Equipment

The major categories of premises and equipment and accumulated depreciation are summarized as follows:

December 31 (In thousands)	2016			2015
Land	$	19,577		$	19,123
Buildings	75,472			74,525
Equipment, furniture and fixtures	52,719			47,839
Leasehold improvements	3,400			3,878
Total	$	151,168		$	145,365
Less accumulated depreciation	(93,197		)	(85,872		)
Premises and equipment, net	$	57,971		$	59,493

Depreciation expense amounted to $8.4 million, $7.3 million and $7.2 million for the years ended December 31, 2016, 2015 and 2014, respectively.

The Corporation leases certain premises and equipment accounted for as operating leases. The following is a schedule of the future minimum rental payments required for the next five years under such leases with initial terms in excess of one year: 

(In thousands)
2017	$	1,508
2018	1,269
2019	1,178
2020	621
2021	422
Thereafter	700
Total	$	5,698

Rent expense for Park was $2.1 million, $1.7 million and $1.7 million, for the years ended December 31, 2016, 2015 and 2014, respectively.

F- 36

Notes to Consolidated Financial Statements

10. Investment in Qualified Affordable Housing

Park makes certain equity investments in various limited partnerships that sponsor affordable housing projects. The purposes of these investments are to achieve a satisfactory return on capital, help create affordable housing opportunities, and assist the Company to achieve our goals associated with the Community Reinvestment Act.

As permitted by ASU 2014-01, Accounting for Investments in Qualified Affordable Housing Projects, Park elected the proportional amortization method of accounting. Under the proportional amortization method, amortization expense and tax benefits are recognized through the provision for income taxes.

The table below details the balances of Park’s affordable housing tax credit investments and related unfunded commitments as of December 31, 2016 and 2015.

(In thousands)	December 31, 2016		December 31, 2015
Affordable housing tax credit investments	$	52,947	$	51,247
Unfunded commitments	14,282		20,311

Commitments are funded when capital calls are made by the general partner. Park expects that the current commitment will be funded between 2017 and 2027.

During the years ended December 31, 2016, 2015 and 2014, Park recognized amortization expense of $7.3 million, $6.7 million and $6.9 million, respectively, which was included within the provision for income taxes. For the years ended December 31, 2016, 2015 and 2014, Park recognized tax credits and other benefits from its affordable housing tax credit investments of $9.4 million, $8.9 million and $8.8 million, respectively.

11. Deposits

At December 31, 2016 and 2015, non-interest bearing and interest bearing deposits were as follows:

December 31 (In thousands)	2016		2015
Non-interest bearing	$	1,523,417	$	1,404,032
Interest bearing	3,998,539		3,943,610
Total	$	5,521,956	$	5,347,642

At December 31, 2016, the maturities of time deposits were as follows: 

(In thousands)
2017	$	717,879
2018	131,236
2019	153,257
2020	63,758
2021	51,245
After 5 years	495
Total	$	1,117,870

At December 31, 2016 and 2015, respectively, Park had approximately $26.5 million and $21.6 million of deposits received from executive officers, directors and related entities of directors.

Time deposits that exceed the FDIC Insurance limit of $250,000 at December 31, 2016 and 2015 were $43.3 million and $49.7 million, respectively.

F- 37

Notes to Consolidated Financial Statements

12. Repurchase Agreement Borrowings

Securities sold under agreements to repurchase ("repurchase agreements") with customers represent funds deposited by customers, generally on an overnight basis, that are collateralized by investment securities owned by Park. Repurchase agreements with customers are included in short-term borrowings on the Consolidated Balance Sheets. Park's repurchase agreements with a third-party financial institution are classified as long-term debt on the Consolidated Balance Sheets.

All repurchase agreements are subject to terms and conditions of repurchase/security agreements between Park and the client and are accounted for as secured borrowings. Park's repurchase agreements reflected in short-term borrowings consist of customer accounts and securities which are pledged on an individual security basis.

At December 31, 2016 and December 31, 2015, Park's repurchase agreement borrowings totaled $510 million and $554 million, respectively. At both December 31, 2016 and December 31, 2015, $300 million of Park's repurchase agreement borrowings were classified as long-term debt, with the remaining amount being classified as short-term debt on the Consolidated Balance Sheets. These borrowings were collateralized with U.S. government and agency securities with a carrying value of $569 million and $622 million at December 31, 2016 and December 31, 2015, respectively. Declines in the value of the collateral would require Park to pledge additional securities. As of December 31, 2016 and December 31, 2015, Park had $640 million and $583 million, respectively, of available unpledged securities.

The following table presents the carrying value of Park's repurchase agreements by remaining contractual maturity and collateral pledged at December 31, 2016 and December 31, 2015:

	December 31, 2016
(In thousands)	Remaining Contractual Maturity of the Agreements
	Overnight and Continuous		Up to 30 days		30 - 90 days		Greater than 90 days		Total
U.S. government and agency securities	$	208,691	$	—	$	—	$	301,104	$	509,795
	December 31, 2015
(In thousands)	Remaining Contractual Maturity of the Agreements
	Overnight and Continuous		Up to 30 days		30 - 90 days		Greater than 90 days		Total
U.S. government and agency securities	$	247,618	$	2,239	$	—	$	304,385	$	554,242

See Note 13 - Short-Term Borrowings for additional information related to repurchase agreements classified as short-term borrowings. See Note 14 - Long-Term Debt for additional information related to repurchase agreements classified as long-term debt.

13. Short-Term Borrowings

Short-term borrowings were as follows:

December 31 (In thousands)	2016		2015
Securities sold under agreements to repurchase	$	209,795	$	254,242
FHLB advances	185,000		140,000
Total short-term borrowings	$	394,795	$	394,242

F- 38

Notes to Consolidated Financial Statements

The outstanding balances for all short-term borrowings as of December 31, 2016 and 2015 and the weighted-average interest rates as of and paid during each of the years then ended were as follows: 

(In thousands)	Repurchase agreements			FHLB Advances
2016
Ending balance	$	209,795		$	185,000
Highest month-end balance	248,277			185,000
Average daily balance	224,763			15,694
Weighted-average interest rate:
As of year-end	0.17		%	0.80		%
Paid during the year	0.16		%	0.63		%
2015
Ending balance	$	254,242		$	140,000
Highest month-end balance	278,324			140,000
Average daily balance	257,622			1,096
Weighted-average interest rate:
As of year-end	0.17		%	0.56		%
Paid during the year	0.18		%	0.59		%

During 2015 and 2016, outstanding FHLB advances were collateralized by investment securities owned by the Corporation’s bank subsidiary and by various loans pledged under a blanket agreement by the Corporation’s bank subsidiary. At December 31, 2016 and 2015, $25 million and $21 million, respectively, of investment securities were pledged as collateral for FHLB advances. At December 31, 2016 and 2015, $1,909 million and $1,985 million, respectively, of commercial real estate and residential mortgage loans were pledged under a blanket agreement to the FHLB by Park’s bank subsidiary. See Note 12 - Repurchase Agreement Borrowings for information related to investment securities collateralizing repurchase agreements.

F- 39

Notes to Consolidated Financial Statements

14. Long-Term Debt

Long-term debt is listed below:

December 31,	2016					2015
(In thousands)	Outstanding Balance			Average Rate		Outstanding Balance			Average Rate
Total Federal Home Loan Bank advances by year of maturity:
2017	$	50,000		1.25	%	$	50,000		1.25	%
2018	150,000			2.04	%	150,000			2.04	%
2019	75,000			1.96	%	75,000			1.96	%
2020	25,000			2.14	%	25,000			2.14	%
2021	—			—	%	—			—	%
Thereafter	100,000			3.40	%	150,000			3.32	%
Total	$	400,000		2.27	%	450,000			2.37	%
Total broker repurchase agreements by year of maturity:
2017	300,000			1.75	%	300,000			1.75	%
Total	$	300,000		1.75	%	$	300,000		1.75	%
Total combined long-term debt by year of maturity:
2017	350,000			1.68	%	350,000			1.68	%
2018	150,000			2.04	%	150,000			2.04	%
2019	75,000			1.96	%	75,000			1.96	%
2020	25,000			2.14	%	25,000			2.14	%
2021	—			—	%	—			—	%
Thereafter	100,000			3.40	%	150,000			3.32	%
Total	$	700,000		2.05	%	$	750,000		2.12	%
Prepayment penalty	(5,719		)	—		(11,895		)	—
Total long-term debt	$	694,281		2.07	%	$	738,105		2.16	%

On November 30, 2012, Park restructured $300 million in repurchase agreements at a rate of 1.75%. As part of this restructuring, Park paid a prepayment penalty of $25 million. The penalty is being amortized as an adjustment to interest expense over the remaining term of the repurchase agreements using the effective interest method, resulting in an effective interest rate of 3.55%. Of the $25 million prepayment penalty, $4.7 million remained to be amortized as of December 31, 2016. The remaining $4.7 million will be amortized in 2017.

On November 21, 2014, Park restructured $50 million in FHLB advances at a rate of 1.25%. As part of this restructuring, Park paid a prepayment penalty of $3.2 million. The penalty is being amortized as an adjustment to interest expense over the remaining term of the advances using the effective interest method, resulting in an effective interest rate of 3.52%. Of the $3.2 million prepayment penalty, $1.0 million remained to be amortized as of December 31, 2016. The remaining $1.0 million will be amortized in 2017.

On March 30, 2015, Park prepaid $54.5 million of FHLB advances, with a weighted average rate of 1.59%, resulting in a prepayment penalty of $532,000 recognized within other expense on the Consolidated Statements of Income.

On October 20, 2016, Park prepaid $50.0 million of FHLB advances, incurring a $5.6 million prepayment penalty recognized within other expense on the Consolidated Statements of Income. These advances had an interest rate of 3.15% and a maturity date of November 13, 2023.

Park had approximately $100.0 million of long-term debt at December 31, 2016 with a contractual maturity longer than five years. However, all of this debt is callable by the lender in 2017.

F- 40

Notes to Consolidated Financial Statements

At December 31, 2016 and 2015, FHLB advances were collateralized by investment securities owned by PNB’s banking divisions and by various loans pledged under a blanket agreement by PNB's banking divisions. At December 31, 2016 and 2015, $25 million and $21 million, respectively, of investment securities were pledged as collateral for FHLB advances. At December 31, 2016 and 2015, $1,909 million and $1,985 million, respectively, of commercial real estate and residential mortgage loans were pledged under a blanket agreement to the FHLB by Park's bank subsidiary. See Note 12 - RepurchaseAgreement Borrowings for information related to investment securities collateralizing repurchase agreements.

15. Subordinated Notes

As part of the acquisition of Vision's parent bank holding company ("Vision Parent") on March 9, 2007, Park became the successor to Vision Parent under (i) the Amended and Restated Trust Agreement of Vision Bancshares Trust I (the “Trust”), dated as of December 5, 2005, (ii) the Junior Subordinated Indenture, dated as of December 5, 2005, and (iii) the Guarantee Agreement, also dated as of December 5, 2005.

On December 1, 2005, Vision Parent formed a wholly-owned Delaware statutory business trust, Vision Bancshares Trust I (“Trust I”), which issued $15.0 million of Trust I's floating rate preferred securities (the “Trust Preferred Securities”) to institutional investors. These Trust Preferred Securities qualify as Tier I capital under FRB guidelines. All of the common securities of Trust I are owned by Park. The proceeds from the issuance of the common securities and the Trust Preferred Securities were used by Trust I to purchase $15.5 million of junior subordinated notes, which carry a floating rate based on three-month LIBOR plus 148 basis points. The debentures represent the sole asset of Trust I. The Trust Preferred Securities accrue and pay distributions at a floating rate of three-month LIBOR plus 148 basis points per annum. The Trust Preferred Securities are mandatorily redeemable upon maturity of the notes in December 2035, or upon earlier redemption as provided in the notes. Park has the right to redeem the notes purchased by Trust I in whole or in part, on or after December 30, 2010. As specified in the indenture, if the notes are redeemed prior to maturity, the redemption price will be the principal amount, plus any unpaid accrued interest. In accordance with GAAP, Trust I is not consolidated with Park’s financial statements, but rather the subordinated notes are reflected as a liability.

On December 23, 2009, Park entered into a Note Purchase Agreement, dated December 23, 2009, with 38 purchasers (the “2009 Purchasers”). Under the terms of the Note Purchase Agreement, the 2009 Purchasers purchased from Park an aggregate principal amount of $35.25 million of 10% Subordinated Notes due December 23, 2019 (the “2009 Notes”). The 2009 Notes were intended to qualify as Tier 2 capital under applicable rules and regulations of the FRB. The 2009 Notes could not be prepaid in any amount prior to December 23, 2014; however, subsequent to that date, Park could prepay, without penalty, all or a portion of the principal amount outstanding. Of the $35.25 million in 2009 Notes, $14.05 million were purchased by related parties. The 2009 Notes were prepaid in full on December 24, 2014, together with accrued interest.

On April 20, 2012, Park entered into a Note Purchase Agreement, dated April 20, 2012 (the “2012 Purchase Agreement”), with 56 purchasers (the "2012 Purchasers"). Under the terms of the 2012 Purchase Agreement, the 2012 Purchasers purchased from Park an aggregate principal amount of $30 million of 7% Subordinated Notes due April 20, 2022 (the "2012 Notes"). The 2012 Notes are intended to qualify as Tier 2 capital under applicable rules and regulations of the FRB. Each 2012 Note was purchased at a purchase price of 100% of the principal amount thereof. The 2012 Notes may not be prepaid by Park prior to April 20, 2017. From and after April 20, 2017, Park may prepay all or, from time to time, any part of the 2012 Notes at 100% of the principal amount (plus accrued interest) without penalty, subject to any requirement under FRB regulations to obtain prior approval from the FRB before making any prepayment.

16. Contingent Liabilities

The Company is a defendant in lawsuits and other adversary proceedings arising in the ordinary course of business. Legal costs incurred in connection with the resolution of claims and lawsuits are generally expensed as incurred, and the Company establishes accruals for the outcome of litigation where losses are deemed probable and reasonably estimable. The Company’s assessment of the current exposure could change in the event of the discovery of additional facts with respect to legal matters pending against the Company or determinations by judges, juries, administrative agencies or other finders of fact that are not in accordance with the Company’s evaluation of claims.

As of December 31, 2016, the Company had accrued charges of approximately $2.3 million for legal contingencies related to various legal and other adversary proceedings.

F- 41

Notes to Consolidated Financial Statements

17. Share-Based Compensation

The Park National Corporation 2013 Long-Term Incentive Plan (the "2013 Incentive Plan") was adopted by the Board of Directors of Park on January 28, 2013 and was approved by Park's shareholders at the Annual Meeting of Shareholders on April 22, 2013. The 2013 Incentive Plan makes equity-based awards and cash-based awards available for grant to participants in the form of incentive stock options, nonqualified stock options, stock appreciation rights, restricted common shares, restricted stock unit awards that may be settled in common shares, cash or a combination of the two, unrestricted common shares and cash-based awards. Under the 2013 Incentive Plan, 600,000 common shares are authorized to be issued and delivered in connection with grants under the 2013 Incentive Plan. The common shares to be issued and delivered under the 2013 Incentive Plan may consist of either common shares currently held or common shares subsequently acquired by Park as treasury shares, including common shares purchased in the open market or in private transactions. No awards may be made under the 2013 Incentive Plan after April 22, 2023. At December 31, 2016, 473,725 common shares were available for future grants under the 2013 Incentive Plan.

During 2016, 2015, and 2014, Park granted 9,950, 10,150, and 10,200 common shares, respectively, to directors of Park and to directors of Park's bank subsidiary PNB (and its divisions) under the 2013 Incentive Plan.  The common shares granted to directors were not subjected to a vesting period and resulted in expense of $950,000, $963,000, and $801,000 in 2016, 2015, and 2014, respectively, which is included in Professional fees and services on the Consolidated Statements of Income. 

During 2016, 2015 and 2014, the Compensation Committee of the Board of Directors of Park granted awards of an aggregate of 41,550, 23,025 and 21,975, respectively, performance based restricted stock units ("PBRSUs") to certain employees of Park and its subsidiaries. The number of PBRSUs earned or settled will depend on certain performance conditions and are also subject to service based vesting. None of the PBRSUs had vested as of December 31, 2016. As of December 31, 2016, an aggregate of 1,125 PBRSUs had been forfeited.

A summary of changes in Park's nonvested shares for the year ended December 31, 2016 follows:

	Shares
Nonvested at January 1, 2016	44,700
Granted	41,550
Vested	—
Forfeited	825
Nonvested at December 31, 2016	85,425

Share-based compensation expense of $1.9 million, $865,000 and $458,000 was recognized for the years ended December 31, 2016, 2015 and 2014, respectively, related to PBRSU awards to employees. The following table details expected additional share-based compensation expense related to PBRSUs currently outstanding:

(In thousands)
2017	$	1,193
2018	1,072
2019	491
2020	83
Total	$	2,839

18. Benefit Plans

The Corporation has a noncontributory Defined Benefit Pension Plan (the “Pension Plan”) covering substantially all of the employees of the Corporation and its subsidiaries. The Pension Plan provides benefits based on an employee’s years of service and compensation.

There were no pension contributions in 2015 or 2016 and there is no contribution expected to be made in 2017.

F- 42

Notes to Consolidated Financial Statements

Using an accrual measurement date of December 31, 2016 and 2015, plan assets and benefit obligation activity for the Pension Plan are listed below:

(In thousands)	2016			2015
Change in fair value of plan assets
Fair value at beginning of measurement period	$	153,498		$	160,598
Actual return on plan assets	19,256			(58		)
Benefits paid	(5,707		)	(7,042		)
Fair value at end of measurement period	$	167,047		$	153,498
Change in benefit obligation
Projected benefit obligation at beginning of measurement period	$	102,245		$	109,328
Service cost	5,055			5,368
Interest cost	4,869			4,695
Actuarial loss (gains)	7,993			(10,104		)
Benefits paid	(5,707		)	(7,042		)
Projected benefit obligation at the end of measurement period	$	114,455		$	102,245
Funded status at end of year (fair value of plan assets less benefit obligation)	$	52,592		$	51,253

The asset allocation for the Pension Plan as of each measurement date, by asset category, was as follows:

		Percentage of Plan Assets
Asset category	Target Allocation	2016		2015
Equity securities	50% - 100%	84	%	85	%
Fixed income and cash equivalents	remaining balance	16	%	15	%
Total		100	%	100	%

The investment policy, as established by the Retirement Plan Committee, is to invest assets according to the target allocation stated above. Assets will be reallocated periodically based on the investment strategy of the Retirement Plan Committee. The investment policy is reviewed periodically.

The expected long-term rate of return on plan assets used to measure the benefit obligation was 7.00% as of December 31, 2016 and 7.25% as of December 31, 2015. This return was based on the expected return of each of the asset categories, weighted based on the median of the target allocation for each class.

The accumulated benefit obligation for the Pension Plan was $97.2 million and $86.1 million at December 31, 2016 and 2015, respectively.

On November 17, 2009, the Park Pension Plan completed the purchase of 115,800 common shares of Park for $7.0 million or $60.45 per share. At December 31, 2016 and 2015, the fair value of the 115,800 common shares held by the Pension Plan was $13.9 million, or $119.66 per share and $10.5 million, or $90.48 per share, respectively.

F- 43

Notes to Consolidated Financial Statements

The weighted average assumptions used to determine benefit obligations at December 31, 2016, 2015 and 2014 were as follows:

	2016		2015		2014
Discount rate	4.58	%	4.88	%	4.42	%
Rate of compensation increase
Under age 30	10.00	%	10.00	%	10.00	%
Ages 30-39	6.00	%	6.00	%	6.00	%
Ages 40-49	4.00	%	3.00	%	3.00	%
Ages 50 and over	3.00	%	3.00	%	3.00	%

The estimated future pension benefit payments reflecting expected future service for the next ten years are shown below (in thousands):

2017	$	6,924
2018	7,644
2019	7,875
2020	8,393
2021	9,503
2022-2026	48,058
Total	$	88,397

The following table shows ending balances of accumulated other comprehensive loss at December 31, 2016 and 2015.

(In thousands)	2016			2015
Prior service cost	$	—		$	—
Net actuarial loss	(22,677		)	(23,618		)
Total	(22,677		)	(23,618		)
Deferred taxes	7,937			8,267
Accumulated other comprehensive loss	$	(14,740	)	$	(15,351	)

F- 44

Notes to Consolidated Financial Statements

Using an actuarial measurement date of December 31 for 2016, 2015 and 2014, components of net periodic benefit income and other amounts recognized in other comprehensive income (loss) were as follows:

(In thousands)	2016			2015			2014
Components of net periodic benefit income and other amounts recognized in other comprehensive income
Service cost	$	(5,055	)	$	(5,368	)	$	(4,331	)
Interest cost	(4,869		)	(4,695		)	(4,577		)
Expected return on plan assets	10,950			11,420			10,869
Amortization of prior service cost	—			(15		)	(19		)
Recognized net actuarial loss	(773		)	(637		)	—
Net periodic benefit income	$	253		$	705		$	1,942
Change to net actuarial gain (loss) for the period	$	168		$	(1,400	)	$	(14,276	)
Amortization of prior service cost	—			15			19
Amortization of net loss	773			637			—
Total recognized in other comprehensive income (loss)	941			(748		)	(14,257		)
Total recognized in net benefit income and other comprehensive income (loss)	$	1,194		$	(43	)	$	(12,315	)

There are no estimated prior service costs for the Pension Plan to be amortized from accumulated other comprehensive income (loss) into net periodic benefit cost over the next fiscal year. The estimated net actuarial loss expected to be recognized in the next fiscal year is $576,000.

The weighted average assumptions used to determine net periodic benefit cost for the years ended December 31, 2016, 2015 and 2014 are listed below:

	2016		2015		2014
Discount Rate	4.88	%	4.42	%	5.30	%
Rate of compensation increase
Under age 30	10.00	%	10.00	%	10.00	%
Ages 30-39	6.00	%	6.00	%	6.00	%
Ages 40 and over	3.00	%	3.00	%	3.00	%
Expected long-term return on plan assets	7.25	%	7.25	%	7.25	%

The Pension Plan maintains cash in a PNB savings account. The Pension Plan cash balance was $2.5 million at December 31, 2016.

GAAP defines fair value as the price that would be received by Park for an asset or paid by Park to transfer a liability (an exit price) in an orderly transaction between market participants on the measurement date, using the most advantageous market for the asset or liability. The fair values of equity securities, consisting of mutual fund investments and common stock (U.S. large cap) held by the Pension Plan and the fixed income and cash equivalents, are determined by obtaining quoted prices on nationally recognized securities exchanges (Level 1 inputs). The fair value of Pension Plan assets at December 31, 2016 was $167.0 million. At December 31, 2016, $149.2 million of equity investments and cash in the Pension Plan were categorized as Level 1 inputs; $17.8 million of plan investments in corporate (U.S. large cap) and U.S. Government sponsored entity bonds were categorized as Level 2 inputs, as fair value was based on quoted market prices of comparable instruments; and no investments were categorized as Level 3 inputs. The fair value of Pension Plan assets was $153.5 million at December 31, 2015. At December 31, 2015, $135.0 million of investments in the Pension Plan were categorized as Level 1 inputs; $18.5 million were categorized as Level 2; and no investments were categorized as Level 3.

The Corporation has a voluntary salary deferral plan covering substantially all of the employees of the Corporation and its subsidiaries. Eligible employees may contribute a portion of their compensation subject to a maximum statutory limitation. The Corporation provides a matching contribution established annually by the Corporation. Contribution expense for the Corporation was $1.3 million, $1.2 million, and $1.1 million for 2016, 2015 and 2014, respectively.

F- 45

Notes to Consolidated Financial Statements

The Corporation has entered into Supplemental Executive Retirement Plan Agreements (the "SERP Agreements") with certain key officers of the Corporation and its subsidiaries which provide defined pension benefits in excess of limits imposed by federal tax law. The accrued benefit cost for the SERP Agreements totaled $8.8 million and $8.0 million for 2016 and 2015, respectively. The expense for the Corporation was $1.5 million for 2016, $1.1 million for 2015 and $1.5 million for 2014.

19. Income Taxes

Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of the Corporation’s deferred tax assets and liabilities are as follows:

December 31 (In thousands)	2016		2015
Deferred tax assets:
Allowance for loan losses	$	17,719	$	19,773
Accumulated other comprehensive loss – Pension plan	7,937		8,266
Accumulated other comprehensive loss – Unrealized losses on securities	1,618		157
Deferred compensation	4,140		3,908
OREO valuation adjustments	2,322		2,418
Net deferred loan fees	1,397		1,204
Deferred contract bonus	1,074		1,031
Nonvested equity-based compensation	1,115		463
Fixed assets	781		413
Accrued litigation	793		482
Other	2,525		2,813
Total deferred tax assets	$	41,421	$	40,928
Deferred tax liabilities:
Deferred investment income	10,199		10,199
Pension plan	26,344		26,205
Mortgage servicing rights	3,243		3,153
Partnership adjustments	549		560
Other	596		872
Total deferred tax liabilities	$	40,931	$	40,989
Net deferred tax asset (liability)	$	490	$	(61	)

Park performs an analysis to determine if a valuation allowance against deferred tax assets is required in accordance with GAAP. Management has determined that it is not required to establish a valuation allowance against the December 31, 2016 or 2015 deferred tax assets in accordance with GAAP since it is more likely than not that the deferred tax assets will be fully utilized in future periods.

The components of the provision for federal income taxes are shown below:

December 31, (In thousands)	2016		2015			2014
Currently payable
Federal	$	28,879	$	26,153		$	27,062
Amortization of qualified affordable housing projects	7,300		6,664			6,869
Deferred
Federal	581		(250		)	2,528
Total	$	36,760	$	32,567		$	36,459

F- 46

Notes to Consolidated Financial Statements

The following is a reconciliation of income tax expense to the amount computed at the statutory rate of 35% for the years ended December 31, 2016, 2015 and 2014.

	2016		2015		2014
Statutory federal corporate tax rate	35.0	%	35.0	%	35.0	%
Changes in rates resulting from:
Tax exempt interest income, net of disallowed interest	(1.3	)%	(0.5	)%	(0.5	)%
Bank owned life insurance	(1.2	)%	(1.8	)%	(1.4	)%
Investments in qualified affordable housing projects, net of tax benefits	(1.7	)%	(1.9	)%	(1.6	)%
Other tax credits	—	%	(0.9	)%	—	%
KSOP dividend deduction	(1.0	)%	(1.0	)%	(1.0	)%
Other	0.1	%	(0.2	)%	(0.2	)%
Effective tax rate	29.9	%	28.7	%	30.3	%

Park and its subsidiaries do not pay state income tax to the state of Ohio, but pay a franchise tax based on equity. The franchise tax expense is included in "State tax expense" on Park’s Consolidated Statements of Income.

Unrecognized Tax Benefits

The following is a reconciliation of the beginning and ending amount of unrecognized tax benefits.

(In thousands)	2016			2015			2014
January 1 Balance	$	558		$	532		$	518
Additions based on tax positions related to the current year	117			80			76
Additions for tax positions of prior years	38			16			14
Reductions for tax positions of prior years	—			—			—
Reductions due to statute of limitations	(80		)	(70		)	(76		)
December 31 Balance	$	633		$	558		$	532

The amount of unrecognized tax benefits that, if recognized, would favorably affect the effective income tax rate in the future periods at December 31, 2016, 2015 and 2014 was $482,000, $432,000 and $413,000, respectively. Park does not expect the total amount of unrecognized tax benefits to significantly increase or decrease during the next year.

The expense related to interest and penalties recorded on unrecognized tax benefits in the Consolidated Statements of Income for the years ended December 31, 2016, and 2015 was $1,500 and $2,000, respectively. There was no expense related to interest and penalties for the year ended December 31, 2014. The amount accrued for interest and penalties at December 31, 2016, 2015 and 2014 was $70,500, $69,000 and $67,000, respectively.

Park and its subsidiaries are subject to U.S. federal income tax and income tax in various state jurisdictions. The Corporation is subject to routine audits of tax returns by the Internal Revenue Service and states in which we conduct business. No material adjustments have been made on closed federal and state tax audits. All tax years ending prior to December 31, 2013 are closed to examination by the federal taxing authorities. Generally, all tax years prior to December 31, 2012 are closed to examination by state taxing authorities.

F- 47

Notes to Consolidated Financial Statements

20. Other Comprehensive Income (Loss)

Other comprehensive income (loss) components, net of income tax, are shown in the following table for the years ended December 31, 2016, 2015 and 2014.

Year ended December 31, (in thousands)		Changes in Pension Plan assets and benefit obligations			Unrealized gains and losses on available-for-sale securities			Total
Beginning balance at January 1, 2016		$	(15,351	)	$	(292	)	$	(15,643	)
	Other comprehensive gain (loss) before reclassifications	109			(2,713		)	(2,604		)
	Amounts reclassified from accumulated other comprehensive loss	502			—			502
Net current period other comprehensive income (loss)		611			(2,713		)	(2,102		)
Ending balance at December 31, 2016		$	(14,740	)	$	(3,005	)	$	(17,745	)
Beginning balance at January 1, 2015		$	(14,865	)	$	1,257		$	(13,608	)
	Other comprehensive loss before reclassifications	(910		)	(1,549		)	(2,459		)
	Amounts reclassified from accumulated other comprehensive loss	424			—			424
Net current period other comprehensive loss		(486		)	(1,549		)	(2,035		)
Ending balance at December 31, 2015		$	(15,351	)	$	(292	)	$	(15,643	)
Beginning balance at January 1, 2014		$	(5,598	)	$	(29,821	)	$	(35,419	)
	Other comprehensive (loss) gain before reclassifications	(9,279		)	30,325			21,046
	Amounts reclassified from accumulated other comprehensive loss	12			753			765
Net current period other comprehensive (loss) income		(9,267		)	31,078			21,811
Ending balance at December 31, 2014		$	(14,865	)	$	1,257		$	(13,608	)

The following table provides information concerning amounts reclassified out of accumulated other comprehensive loss for the years ended December 31, 2016, 2015 and 2014:

		Amount Reclassified from Accumulated Other Comprehensive Income (Loss)						Affected Line Item in the Consolidated Statement of Income
(In thousands)		2016		2015		2014
Amortization of defined benefit pension items
	Amortization of prior service cost	$	—	$	15	$	19	Employee benefits
	Amortization of net loss	773		637		—		Employee benefits
Income before income taxes		773		652		19		Income before income taxes
	Federal income taxes	271		228		7		Federal income taxes
	Net of income tax	$	502	$	424	$	12	Net of income tax
Unrealized gains & losses on available for sale securities
	Loss on sale of investment securities	$	—	$	—	$	1,158	Gain (loss) on sale of investment securities
	Other than temporary impairment	—		—		—		Miscellaneous expense
Income before income taxes		—		—		1,158		Income before income taxes
	Federal income taxes	—		—		405		Federal income taxes
	Net of income tax	$	—	$	—	$	753	Net of income tax

F- 48

Notes to Consolidated Financial Statements

21. Earnings Per Common Share

GAAP requires the reporting of basic and diluted earnings per common share. Basic earnings per common share excludes any dilutive effects of restricted stock units.

The following table sets forth the computation of basic and diluted earnings per common share:

Year ended December 31 (In thousands, except share data)	2016		2015		2014
Numerator:
Net income available to common shareholders	$	86,135	$	81,012	$	83,957
Denominator:
Weighted-average common shares outstanding	15,332,553		15,364,281		15,394,971
Effect of dilutive performance-based restricted stock units	72,607		40,459		18,861
Weighted-average common shares outstanding adjusted for the effect of dilutive performance-based restricted stock units	15,405,160		15,404,740		15,413,832
Earnings per common share:
Basic earnings per common share	$	5.62	$	5.27	$	5.45
Diluted earnings per common share	$	5.59	$	5.26	$	5.45

Park awarded 41,550, 23,025 and 21,975 PBRSUs to certain employees during the years ended December 31, 2016, 2015 and 2014, respectively. The PBRSUs vest based on service and performance conditions. The dilutive effect of the PBRSUs was the addition of 72,607, 40,459 and 18,861 common shares for the years ended December 31, 2016, 2015 and 2014, respectively.

During the years ended December 31, 2015 and 2014, Park repurchased 71,700 and 29,700 common shares, respectively, to fund the PBRSUs and common shares awarded to directors of Park and to directors of Park's subsidiary PNB (and its divisions). No common shares were repurchased during 2016.

22. Dividend Restrictions

Bank regulators limit the amount of dividends a subsidiary bank can declare in any calendar year without obtaining prior approval. At December 31, 2016, approximately $71.7 million of the total shareholders’ equity of PNB was available for the payment of dividends to the Corporation, without approval by the applicable regulatory authorities.

23. Financial Instruments with Off-Balance Sheet Risk and Financial Instruments with Concentrations of Credit Risk

The Corporation is party to financial instruments with off-balance sheet risk in the normal course of business to meet the financing needs of its customers. These financial instruments include loan commitments and standby letters of credit. The instruments involve, to varying degrees, elements of credit and interest rate risk in excess of the amount recognized in the consolidated financial statements.

The Corporation’s exposure to credit loss in the event of nonperformance by the other party to the financial instrument for loan commitments and standby letters of credit is represented by the contractual amount of those instruments. The Corporation uses the same credit policies in making commitments and conditional obligations as it does for on-balance sheet instruments. Since many of the loan commitments may expire without being drawn upon, the total commitment amount does not necessarily represent future cash requirements. The credit risk involved in issuing letters of credit is essentially the same as that involved in extending loan commitments to customers.

The total amounts of off-balance sheet financial instruments with credit risk were as follows:

December 31 (In thousands)	2016		2015
Loan commitments	$	912,007	$	888,411
Standby letters of credit	13,746		12,326

The loan commitments are generally for variable rates of interest.

F- 49

Notes to Consolidated Financial Statements

The Corporation grants retail, commercial and commercial real estate loans to customers primarily located in Ohio. The Corporation evaluates each customer’s creditworthiness on a case-by-case basis. The amount of collateral obtained, if deemed necessary by the Corporation upon extension of credit, is based on management’s credit evaluation of the customer. Collateral held varies but may include accounts receivable, inventory, property, plant and equipment, and income-producing commercial properties.

Although the Corporation has a diversified loan portfolio, a substantial portion of the borrowers’ ability to honor their contracts is dependent upon the economic conditions in each borrower’s geographic location and industry.

24. Loan Servicing

Park serviced sold mortgage loans of $1,330 million at December 31, 2016, compared to $1,276 million at December 31, 2015 and $1,265 million at December 31, 2014. At December 31, 2016, $4.1 million of the sold mortgage loans were sold with recourse compared to $5.4 million at December 31, 2015 and $7.0 million at December 31, 2014. Management closely monitors the delinquency rates on the mortgage loans sold with recourse. As of December 31, 2016 and 2015, management had established a reserve of $266,000 and $454,000, respectively, to account for future loan repurchases.

When Park sells mortgage loans with servicing rights retained, servicing rights are initially recorded at fair value. Park selected the “amortization method” as permissible within U.S. GAAP, whereby the servicing rights capitalized are amortized in proportion to and over the period of estimated future servicing income of the underlying loan. At the end of each reporting period, the carrying value of mortgage servicing rights (“MSRs”) is assessed for impairment with a comparison to fair value. MSRs are carried at the lower of their amortized cost or fair value. The amortization of mortgage loan servicing rights is included within “Other service income” in the Consolidated Statements of Income.

Activity for mortgage servicing rights and the related valuation allowance follows:

December 31 (In thousands)	2016			2015			2014
Mortgage servicing rights:
Carrying amount, net, beginning of year	$	9,008		$	8,613		$	9,013
Additions	2,286			1,748			1,026
Amortization	(1,835		)	(1,637		)	(1,631		)
Change in valuation allowance	(193		)	284			205
Carrying amount, net, end of year	$	9,266		$	9,008		$	8,613
Valuation allowance:
Beginning of year	$	542		$	826		$	1,031
Change in valuation allowance	193			(284		)	(205		)
End of year	$	735		$	542		$	826

The fair value of mortgage servicing rights was $9.3 million and $9.6 million at December 31, 2016 and 2015, respectively. The fair value of mortgage servicing rights at December 31, 2016 was established using a discount rate of 13% and constant prepayment speeds ranging from 6.2% to 16.8%. The fair value of mortgage servicing rights at December 31, 2015 was established using a discount rate of 10% and constant prepayment speeds ranging from 6.3% to 22.0%.

Servicing fees included in other service income were $3.4 million, $3.4 million and $3.5 million for the years ended December 31, 2016, 2015 and 2014, respectively.

F- 50

Notes to Consolidated Financial Statements

25. Fair Value

The fair value hierarchy requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The three levels of inputs that Park uses to measure fair value are as follows:

• Level 1: Quoted prices (unadjusted) for identical assets or liabilities in active markets that Park has the ability to access as of the measurement date.

• Level 2: Level 1 inputs for assets or liabilities that are not actively traded. Also consists of an observable market price for a similar asset or liability. This includes the use of “matrix pricing” to value debt securities absent the exclusive use of quoted prices.

• Level 3: Consists of unobservable inputs that are used to measure fair value when observable market inputs are not available. This could include the use of internally developed models, financial forecasting and similar inputs.

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability between market participants at the balance sheet date. When possible, the Company looks to active and observable markets to price identical assets or liabilities. When identical assets and liabilities are not traded in active markets, the Company looks to observable market data for similar assets and liabilities. However, certain assets and liabilities are not traded in observable markets and Park must use other valuation methods to develop a fair value. The fair value of impaired loans is typically based on the fair value of the underlying collateral, which is estimated through third-party appraisals or internal estimates of collateral values in accordance with Park's valuation requirements per its commercial and real estate loan policies.

Assets and Liabilities Measured at Fair Value on a Recurring Basis:

The following table presents assets and liabilities measured at fair value on a recurring basis:

Fair Value Measurements at December 31, 2016 using:
(In thousands)	Level 1		Level 2		Level 3		Balance at December 31, 2016
Assets
Investment securities:
Obligations of U.S. Treasury and other U.S. Government sponsored entities	$	—	$	267,533	$	—	$	267,533
U.S. Government sponsored entities’ asset-backed securities	—		987,172		—		987,172
Equity securities	2,644		—		790		3,434
Mortgage loans held for sale	—		10,413		—		10,413
Mortgage IRLCs	—		124		—		124
Liabilities
Fair value swap	$	—	$	—	$	226	$	226

F- 51

Notes to Consolidated Financial Statements

Fair Value Measurements at December 31, 2015 using:
(In thousands)	Level 1		Level 2		Level 3		Balance at December 31, 2015
Assets
Investment securities:
Obligations of U.S. Treasury and other U.S. Government sponsored entities	$	—	$	522,063	$	—	$	522,063
U.S. Government sponsored entities’ asset-backed securities	—		911,493		—		911,493
Equity securities	1,941		—		769		2,710
Mortgage loans held for sale	—		7,306		—		7,306
Mortgage IRLCs	—		165		—		165
Liabilities
Fair value swap	$	—	$	—	$	226	$	226

There were no transfers between Level 1 and Level 2 during 2016 or 2015. Management’s policy is to transfer assets or liabilities from one level to another when the methodology to obtain the fair value changes such that there are more or fewer unobservable inputs as of the end of the reporting period.

The following methods and assumptions were used by the Company in determining fair value of the financial assets and liabilities discussed above:

Investment securities: Fair values for investment securities are based on quoted market prices, where available. If quoted market prices are not available, fair values are based on quoted market prices of comparable instruments. For securities where quoted prices or market prices of similar securities are not available, fair values are calculated using discounted cash flows.

Fair value swap: The fair value of the swap agreement entered into with the purchaser of the Visa Class B shares represents an internally developed estimate of the exposure based upon probability-weighted potential Visa litigation losses.

Mortgage Interest Rate Lock Commitments (IRLCs): IRLCs are based on current secondary market pricing and are classified as Level 2.

Mortgage loans held for sale: Mortgage loans held for sale are carried at their fair value. Mortgage loans held for sale are estimated using security prices for similar product types and, therefore, are classified in Level 2.

F- 52

Notes to Consolidated Financial Statements

The table below is a reconciliation of the beginning and ending balances of the Level 3 inputs for the years ended December 31, 2016 and 2015, for financial instruments measured on a recurring basis and classified as Level 3:

Level 3 Fair Value Measurements
(In thousands)	Equity Securities			Fair Value Swap
Balance at January 1, 2016	$	769		$	(226	)
Total Gains (Losses)
Included in earnings - realized	—			—
Included in earnings - unrealized	—			—
Included in other comprehensive income	21			—
Purchases, sales, issuances and settlements, other, net	—			—
Re-evaluation of fair value swap	—			—
Balance at December 31, 2016	$	790		$	(226	)
Balance at January 1, 2015	$	776		$	(226	)
Total Gains (Losses)
Included in earnings - realized	—			—
Included in earnings - unrealized	—			—
Included in other comprehensive income	(7		)	—
Purchases, sales, issuances and settlements, other, net	—			—
Re-evaluation of fair value swap	—			—
Balance at December 31, 2015	$	769		$	(226	)

Assets and liabilities measured at fair value on a nonrecurring basis:

The following methods and assumptions were used by the Company in determining the fair value of assets and liabilities measured at fair value on a nonrecurring basis described below:

Impaired Loans: At the time a loan is considered impaired, it is valued at the lower of cost or fair value. Impaired loans carried at fair value have been partially charged off or receive specific allocations of the allowance for loan losses. For collateral dependent loans, fair value is generally based on real estate appraisals. These appraisals may utilize a single valuation approach or a combination of approaches including comparable sales and the income approach. Adjustments are routinely made in the appraisal process by the independent appraisers to adjust for differences between the comparable sales and income data available. Such adjustments result in a Level 3 classification of the inputs for determining fair value. Collateral is then adjusted or discounted based on management’s historical knowledge, changes in market conditions from the time of the valuation, and management’s expertise and knowledge of the client and client’s business, also resulting in a Level 3 fair value classification. Impaired loans are evaluated on a quarterly basis for additional impairment and adjusted accordingly. Additionally, updated independent valuations are obtained annually for all impaired loans in accordance with Company policy.

Other Real Estate Owned (OREO): Assets acquired through or in lieu of loan foreclosure are initially recorded at fair value less costs to sell when acquired. The carrying value of OREO is not re-measured to fair value on a recurring basis, but is subject to fair value adjustments when the carrying value exceeds the fair value, less estimated selling costs. Fair value is based on recent real estate appraisals and is updated at least annually. These appraisals may utilize a single valuation approach or a combination of approaches including the comparable sales approach and the income approach. Adjustments are routinely made in the appraisal process by the independent appraisers to adjust for differences between the comparable sales and income data available. Such adjustments result in a Level 3 classification of the inputs for determining fair value.

Appraisals for both collateral dependent impaired loans and OREO are performed by licensed appraisers. Appraisals are generally obtained to support the fair value of collateral. In general, there are three types of appraisals, real estate appraisals, income approach appraisals and lot development loan appraisals, received by the Company. These are discussed below:

• Real estate appraisals typically incorporate measures such as recent sales prices for comparable properties. Appraisers may make adjustments to the sales prices of the comparable properties as deemed appropriate based on the age, condition or general characteristics of the subject property. Management generally applies a 15% discount to real

F- 53

Notes to Consolidated Financial Statements

estate appraised values which management expects will cover all disposition costs (including selling costs). This 15% is based on historical discounts to appraised values on sold OREO properties.

• Income approach appraisals typically incorporate the annual net operating income of the business divided by an appropriate capitalization rate, as determined by the appraiser. Management generally applies a 15% discount to income approach appraised values which management expects will cover all disposition costs (including selling costs).

• Lot development loan appraisals are typically performed using a discounted cash flow analysis. Appraisers determine an anticipated absorption period and a discount rate that takes into account an investor’s required rate of return based on recent comparable sales. Management generally applies a 6% discount to lot development appraised values, which is an additional discount above the net present value calculation included in the appraisal, to account for selling costs.

MSRs: MSRs are carried at the lower of cost or fair value. MSRs do not trade in active, open markets with readily observable prices. For example, sales of MSRs do occur, but precise terms and conditions typically are not readily available. As such, management, with the assistance of a third-party specialist, determines fair value based on the discounted value of the future cash flows estimated to be received. Significant inputs include the discount rate and assumed prepayment speeds utilized. The calculated fair value is then compared to market values where possible to ascertain the reasonableness of the valuation in relation to current market expectations for similar products. Accordingly, MSRs are classified as Level 2.

The following tables' present assets and liabilities measured at fair value on a nonrecurring basis. Collateral dependent impaired loans are carried at fair value if they have been charged down to fair value or if a specific valuation allowance has been established. A new cost basis is established at the time a property is initially recorded in OREO. OREO properties are carried at fair value if a devaluation has been taken to the property's value subsequent to the initial measurement.

Fair Value Measurements at December 31, 2016 Using:
(In thousands)	Level 1		Level 2		Level 3		Balance at December 31, 2016
Impaired Loans:
Commercial real estate	$	—	$	—	$	3,057	$	3,057
Construction real estate	—		—		541		541
Residential real estate	—		—		2,385		2,385
Total impaired loans	$	—	$	—	$	5,983	$	5,983
Mortgage Servicing Rights	$	—	$	6,769	$	—	$	6,769
Other Real Estate Owned:
Commercial real estate	—		—		2,644		2,644
Construction real estate	—		—		3,322		3,322
Residential real estate	—		—		931		931
Total Other Real Estate Owned	$	—	$	—	$	6,897	$	6,897

F- 54

Notes to Consolidated Financial Statements

Fair Value Measurements at December 31, 2015 Using:
(In thousands)	Level 1		Level 2		Level 3		Balance at December 31, 2015
Impaired Loans:
Commercial real estate	$	—	$	—	$	3,698	$	3,698
Construction real estate:
SEPH commercial land and development	—		—		2,044		2,044
Remaining commercial	—		—		1,872		1,872
Residential real estate	—		—		1,882		1,882
Total impaired loans	$	—	$	—	$	9,496	$	9,496
Mortgage Servicing Rights	$	—	$	1,867	$	—	$	1,867
Other Real Estate Owned:
Commercial real estate	—		—		2,796		2,796
Construction real estate	—		—		3,387		3,387
Residential real estate	—		—		2,332		2,332
Total Other Real Estate Owned	$	—	$	—	$	8,515	$	8,515

The table below provides additional detail on those impaired loans which are recorded at fair value as well as the remaining impaired loan portfolio not included above. The remaining impaired loans consist of loans which are not collateral dependent as well as loans carried at cost as the fair value of the underlying collateral or the present value of expected future cash flows on each of the loans exceeded the book value for each respective credit.

	December 31, 2016
(In thousands)	Recorded Investment		Prior Charge-Offs		Specific Valuation Allowance		Carrying Balance
Impaired loans recorded at fair value	$	6,379	$	3,681	$	396	$	5,983
Remaining impaired loans	64,047		21,262		152		63,895
Total impaired loans	$	70,426	$	24,943	$	548	$	69,878

	December 31, 2015
(In thousands)	Recorded Investment		Prior Charge-Offs		Specific Valuation Allowance		Carrying Balance
Impaired loans recorded at fair value	$	11,783	$	10,512	$	2,287	$	9,496
Remaining impaired loans	68,881		18,193		1,904		66,977
Total impaired loans	$	80,664	$	28,705	$	4,191	$	76,473

The income (expense) from credit adjustments related to impaired loans carried at fair value for the years ended December 31, 2016, 2015 and 2014 was $0.9 million, $(2.1) million, and $(3.0) million, respectively.

MSRs totaled $9.3 million at December 31, 2016. Of this $9.3 million MSR carrying balance, $6.8 million was recorded at fair value and included a valuation allowance of $0.7 million. The remaining $2.5 million was recorded at cost, as the fair value exceeded cost at December 31, 2016. At December 31, 2015, MSRs totaled $9.0 million. Of this $9.0 million MSR carrying balance, $1.9 million was recorded at fair value and included a valuation allowance of $0.5 million. The remaining $7.1 million was recorded at cost, as the fair value exceeded cost at December 31, 2015. The (expense) income related to MSRs carried at fair value for the years ended December 31, 2016, 2015 and 2014 was $(0.2) million, $0.3 million and $0.2 million, respectively.

F- 55

Notes to Consolidated Financial Statements

Total OREO held by Park at December 31, 2016 and 2015 was $13.9 million and $18.7 million, respectively. Approximately 50% and 46% of OREO held by Park at December 31, 2016 and 2015, respectively, was carried at fair value due to fair value adjustments made subsequent to the initial OREO measurement. At December 31, 2016 and 2015, OREO held at fair value, less estimated selling costs, amounted to $6.9 million and $8.5 million, respectively. The net expense related to OREO fair value adjustments was $0.6 million, $1.6 million and $2.4 million for the years ended December 31, 2016, 2015 and 2014, respectively.

The following tables present quantitative information about Level 3 fair value measurements for financial instruments measured at fair value on a non-recurring basis at December 31, 2016 and December 31, 2015:

December 31, 2016
(In thousands)	Fair Value		Valuation Technique	Unobservable Input(s)	Range (Weighted Average)
Impaired loans:
Commercial real estate	$	3,057	Sales comparison approach	Adj to comparables	0.0% - 90.0% (20.2%)
			Income approach	Capitalization rate	9.0% - 10.6% (10.1%)
			Cost approach	Accumulated depreciation	17.0% - 18.0% (17.8%)
Construction real estate	$	541	Sales comparison approach	Adj to comparables	0.0% - 11.1% (1.6%)
			Bulk sale approach	Discount rate	10.0% (10.0%)
Residential real estate	$	2,385	Sales comparison approach	Adj to comparables	0.3% - 110.0% (17.0%)
			Income approach	Capitalization rate	10.0% (10.0%)
Other real estate owned:
Commercial real estate	$	2,644	Sales comparison approach	Adj to comparables	0.0% - 68.4% (26.5%)
			Income approach	Capitalization rate	13.0% - 14.0% (13.1%)
Construction real estate	$	3,322	Sales comparison approach	Adj to comparables	0.0% - 90.0% (24.7%)
			Bulk sale approach	Discount rate	15.0% (15.0%)
Residential real estate	$	931	Sales comparison approach	Adj to comparables	3.2% - 79.7% (30.6%)

F- 56

Notes to Consolidated Financial Statements

December 31, 2015
(In thousands)	Fair Value		Valuation Technique	Unobservable Input(s)	Range (Weighted Average)
Impaired loans:
Commercial real estate	$	3,698	Sales comparison approach	Adj to comparables	0.0% - 45.9% (20.3%)
			Income approach	Capitalization rate	7.0% - 13.3% (9.5%)
			Cost approach	Accumulated depreciation	50.0% (50.0%)
Construction real estate:
SEPH commercial land and development	$	2,044	Sales comparison approach	Adj to comparables	5.0% - 40.0% (22.1%)
			Bulk sale approach	Discount rate	10.7% (10.7%)
Remaining commercial	$	1,872	Sales comparison approach	Adj to comparables	0.0% - 25.3% (1.0%)
			Bulk sale approach	Discount rate	10.0% - 10.7% (10.0%)
Residential real estate	$	1,882	Sales comparison approach	Adj to comparables	0.0% - 96.7% (12.5%)
			Income approach	Capitalization rate	3.8% - 10.1% (9.1%)
			Cost approach	Accumulated depreciation	33.3% - 50.0% (43.4%)
Other real estate owned:
Commercial real estate	$	2,796	Sales comparison approach	Adj to comparables	2.0% - 71.0% (26.9%)
			Income approach	Capitalization rate	9.5% (9.5%)
Construction real estate	$	3,387	Sales comparison approach	Adj to comparables	0.0% - 85.0% (24.3%)
			Bulk sale approach	Discount rate	15.0% (15.0%)
Residential real estate	$	2,332	Sales comparison approach	Adj to comparables	0.1% - 61.8% (23.0%)

F- 57

Notes to Consolidated Financial Statements

The following methods and assumptions were used by the Corporation in estimating its fair value disclosures for assets and liabilities not discussed above:

Cash and cash equivalents:The carrying amounts reported in the Consolidated BalanceSheets for cash and short-term instruments approximate those assets’ fair values.

Other investments: FHLB stock and FRB stock within other investments are carried at their respective redemption values as it is not practical to calculate their fair values. Additional investments within this category are carried at their cost basis as these investments do not have a readily determinable fair value and Park does not have the ability to influence the operating or financial decisions of the investee.

Loans receivable:For variable-rate loans that reprice frequently and with no significant change in credit risk, fair values are based on carrying values. The fair values for certain mortgage loans (e.g., one-to-four family residential) are based on quoted market prices of similar loans sold in conjunction with securitization transactions, adjusted for differences in loan characteristics. The fair values for other loans are estimated using discounted cash flow analyses, based upon interest rates currently being offered for loans with similar terms to borrowers of similar credit quality. The methods utilized to estimate fair value do not necessarily represent an exit price.

Off-balance sheet instruments:Fair values for the Corporation’s loan commitments and standby letters of credit are based on the fees currently charged to enter into similar agreements, taking into account the remaining terms of the agreements and the counterparties’ credit standing. The carrying amount and fair value are not material.

 Deposit liabilities:The fair values disclosed for demand deposits (e.g., interest and non-interest checking, savings, and money market accounts) are, by definition, equal to the amount payable on demand at the reporting date (i.e., their carrying amounts). The carrying amounts for variable-rate, fixed-term certificates of deposit approximate their fair values at the reporting date. Fair values for fixed-rate certificates of deposit are estimated using a discounted cash flow calculation that applies interest rates currently being offered on certificates to a schedule of aggregated expected monthly maturities of time deposits.

Short-term borrowings:The carrying amounts of federal funds purchased, borrowings under repurchase agreements and other short-term borrowings approximate their fair values.

Long-term debt:Fair values for long-term debt are estimated using a discounted cash flow calculation that applies interest rates currently being offered on long-term debt to a schedule of monthly maturities.

Subordinated notes:Fair values for subordinated notes are estimated using a discounted cash flow calculation that applies interest rate spreads currently being offered on similar debt structures to a schedule of monthly maturities.

F- 58

Notes to Consolidated Financial Statements

The fair value of financial instruments at December 31, 2016 and December 31, 2015, was as follows:

	December 31, 2016
			Fair Value Measurements
(In thousands)	Carrying value		Level 1		Level 2		Level 3		Total fair value
Financial assets:
Cash and money market instruments	$	146,466	$	146,466	$	—	$	—	$	146,466
Investment securities	1,517,972		2,644		1,511,377		790		1,514,811
Accrued interest receivable - securities	3,849		—		3,849		—		3,849
Accrued interest receivable - loans	14,973		—		—		14,973		14,973
Mortgage loans held for sale	10,413		—		10,413		—		10,413
Impaired loans carried at fair value	5,983		—		—		5,983		5,983
Mortgage IRLCs	124		—		124		—		124
Other loans	5,204,713		—		—		5,161,919		5,161,919
Loans receivable, net	$	5,221,233	$	—	$	10,537	$	5,167,902	$	5,178,439
Financial liabilities:
Non-interest bearing checking accounts	$	1,523,417	$	1,523,417	$	—	$	—	$	1,523,417
Interest bearing transaction accounts	1,174,448		1,174,448		—		—		1,174,448
Savings accounts	1,704,920		1,704,920		—		—		1,704,920
Time deposits	1,117,870		—		1,122,598		—		1,122,598
Other	1,301		1,301		—		—		1,301
Total deposits	$	5,521,956	$	4,404,086	$	1,122,598	$	—	$	5,526,684
Short-term borrowings	$	394,795	$	—	$	394,795	$	—	$	394,795
Long-term debt	694,281		—		712,958		—		712,958
Subordinated notes	45,000		—		40,903		—		40,903
Accrued interest payable – deposits	900		82		818		—		900
Accrued interest payable – debt/borrowings	1,251		1		1,250		—		1,251
Derivative financial instruments:
Fair value swap	$	226	$	—	$	—	$	226	$	226

F- 59

Notes to Consolidated Financial Statements

	December 31, 2015
			Fair Value Measurements
(In thousands)	Carrying value		Level 1		Level 2		Level 3		Total fair value
Financial assets:
Cash and money market instruments	$	149,459	$	149,459	$	—	$	—	$	149,459
Investment securities	1,585,568		1,941		1,584,984		769		1,587,694
Accrued interest receivable - securities	4,436		—		4,436		—		4,436
Accrued interest receivable - loans	14,239		—		—		14,239		14,239
Mortgage loans held for sale	7,306		—		7,306		—		7,306
Impaired loans carried at fair value	9,496		—		—		9,496		9,496
Mortgage IRLCs	165		—		165		—		165
Other loans	4,994,624		—		—		4,997,318		4,997,318
Loans receivable, net	$	5,011,591	$	—	$	7,471	$	5,006,814	$	5,014,285
Financial liabilities:
Non-interest bearing checking accounts	$	1,404,032	$	1,404,032	$	—	—		$	1,404,032
Interest bearing transaction accounts	1,107,200		1,107,200		—		—		1,107,200
Savings accounts	1,544,708		1,544,708		—		—		1,544,708
Time deposits	1,290,412		—		1,295,329		—		1,295,329
Other	1,290		1,290		—		—		1,290
Total deposits	$	5,347,642	$	4,057,230	$	1,295,329	$	—	$	5,352,559
Short-term borrowings	$	394,242	$	—	$	394,242	$	—	$	394,242
Long-term debt	738,105		—		771,420		—		771,420
Subordinated notes	45,000		—		41,596		—		41,596
Accrued interest payable – deposits	987		66		921		—		987
Accrued interest payable – debt/borrowings	1,351		4		1,347		—		1,351
Derivative financial instruments:
Fair value swap	$	226	$	—	$	—	$	226	$	226

26. Capital Ratios

Financial institution regulators have established guidelines for minimum capital ratios for banks, thrifts and bank holding companies. During the first quarter of 2015, Park adopted the Basel III regulatory capital framework as approved by the federal banking agencies. The adoption of this framework modified the calculation of the various capital ratios, added an additional ratio, common equity tier 1, and revised the adequately and well capitalized thresholds. Additionally, under this framework, in order to avoid limitations on capital distributions, including dividend payments, Park must hold a capital conservation buffer above the adequately capitalized risk-based capital ratios. The capital conservation buffer is being phased in from 0.0% for 2015 to 2.50% by 2019. The capital conservation buffer was 0.625% for 2016. The amounts shown below as the adequately capitalized ratio plus capital conservation buffer includes the fully phased-in 2.50% buffer.

F- 60

Notes to Consolidated Financial Statements

PNB met each of the well-capitalized ratio guidelines at December 31, 2016. The following table indicates the capital ratios for PNB and Park at December 31, 2016 and 2015.

	As of December 31, 2016
	Leverage		Tier 1 Risk-Based		Common Equity Tier 1		Total Risk-Based
The Park National Bank	7.34	%	9.87	%	9.87	%	11.24	%
Park National Corporation	9.56	%	12.83	%	12.55	%	14.32	%
Adequately capitalized ratio	4.00	%	6.00	%	4.50	%	8.00	%
Adequately capitalized ratio plus capital conservation buffer	4.00	%	8.50	%	7.00	%	10.50	%
Well-capitalized ratio (PNB only)	5.00	%	8.00	%	6.50	%	10.00	%

	As of December 31, 2015
	Leverage		Tier 1 Risk-Based		Common Equity Tier 1		Total Risk-Based
The Park National Bank	7.06	%	9.83	%	9.83	%	11.37	%
Park National Corporation	9.22	%	12.82	%	12.54	%	14.49	%
Adequately capitalized ratio	4.00	%	6.00	%	4.50	%	8.00	%
Adequately capitalized ratio plus capital conservation buffer	4.00	%	8.50	%	7.00	%	10.50	%
Well-capitalized ratio (PNB only)	5.00	%	8.00	%	6.50	%	10.00	%

Failure to meet the minimum requirements above could cause the FRB to take action. PNB is also subject to the capital requirements of its primary regulator, the OCC. As of December 31, 2016 and 2015, Park and PNB were well-capitalized and met all capital requirements to which each was then subject. There are no conditions or events since PNB's most recent regulatory report filings, that management believes have changed the risk categories for PNB.

F- 61

Notes to Consolidated Financial Statements

The following table reflects various measures of capital for Park and PNB:

					To Be Adequately Capitalized				To Be Well Capitalized
(In thousands)	Actual Amount		Ratio		Amount		Ratio		Amount		Ratio
At December 31, 2016
Total Risk-Based Capital (to risk-weighted assets)
PNB	$	607,269	11.24	%	$	432,153	8.00	%	$	540,192	10.00	%
Park	784,406		14.32	%	438,231		8.00	%	N/A		N/A
Tier 1 Risk-Based Capital (to risk-weighted assets)
PNB	$	533,215	9.87	%	$	324,115	6.00	%	$	432,153	8.00	%
Park	702,651		12.83	%	328,673		6.00	%	N/A		N/A
Leverage Ratio (to average total assets)
PNB	$	533,215	7.34	%	$	290,671	4.00	%	$	363,339	5.00	%
Park	702,651		9.56	%	293,916		4.00	%	N/A		N/A
Common Equity Tier 1 (to risk-weighted assets)
PNB	$	533,215	9.87	%	$	243,086	4.50	%	$	351,125	6.50	%
Park	687,651		12.55	%	246,505		4.50	%	N/A		N/A
At December 31, 2015
Total Risk-Based Capital (to risk-weighted assets)
PNB	$	588,467	11.37	%	$	414,079	8.00	%	$	517,599	10.00	%
Park	758,988		14.49	%	419,080		8.00	%	N/A		N/A
Tier 1 Risk-Based Capital (to risk-weighted assets)
PNB	$	508,763	9.83	%	$	310,560	6.00	%	$	414,079	8.00	%
Park	671,664		12.82	%	314,310		6.00	%	N/A		N/A
Leverage Ratio (to average total assets)
PNB	$	508,763	7.06	%	$	288,147	4.00	%	$	360,183	5.00	%
Park	671,664		9.22	%	291,449		4.00	%	N/A		N/A
Common Equity Tier 1 (to risk-weighted assets)
PNB	508,763		9.83	%	232,920		4.50	%	336,439		6.50	%
Park	656,664		12.54	%	235,732		4.50	%	N/A		N/A

27. Segment Information

The Corporation is a financial holding company headquartered in Newark, Ohio. The operating segments for the Corporation are its chartered national bank subsidiary, PNB (headquartered in Newark, Ohio), SEPH and GFSC.

GAAP requires management to disclose information about the different types of business activities in which a company engages and also information on the different economic environments in which a company operates, so that the users of the financial statements can better understand a company’s performance, better understand the potential for future cash flows, and make more informed judgments about the company as a whole. Park’s current operating segments are in line with GAAP as: (i) discrete financial information is available for each operating segment and (ii) the segments are aligned with internal reporting to Park’s Chief Executive Officer and President, who is the chief operating decision-maker.  

F- 62

Notes to Consolidated Financial Statements

Operating results for the year ended December 31, 2016 (In thousands)
	PNB		GFSC			SEPH			All Other			Total
Net interest income (loss)	$	227,576	$	5,874		$	4,774		$	(138	)	$	238,086
Provision for (recovery of) loan losses	2,611		1,887			(9,599		)	—			(5,101		)
Other income (loss)	74,803		(1		)	2,974			955			78,731
Other expense	177,562		4,457			7,273			9,731			199,023
Income (loss) before taxes	122,206		(471		)	10,074			(8,914		)	122,895
Income taxes (benefit)	37,755		(164		)	3,526			(4,357		)	36,760
Net income (loss)	$	84,451	$	(307	)	$	6,548		$	(4,557	)	$	86,135
Balances at December 31, 2016
Assets	$	7,389,538	$	32,268		$	25,342		$	20,438		$	7,467,586
Loans	5,234,828		32,661			12,354			(7,986		)	5,271,857
Deposits	5,630,199		3,809			—			(112,052		)	5,521,956

Operating results for the year ended December 31, 2015 (In thousands)
	PNB		GFSC		SEPH			All Other			Total
Net interest income (loss)	$	220,879	$	6,588	$	(74	)	$	239		$	227,632
Provision for (recovery of) loan losses	7,665		1,415		(4,090		)	—			4,990
Other income	75,188		2		1,848			513			77,551
Other expense	167,476		2,984		6,182			9,972			186,614
Income (loss) before taxes	120,926		2,191		(318		)	(9,220		)	113,579
Income taxes (benefit)	36,581		768		(111		)	(4,671		)	32,567
Net income (loss)	$	84,345	$	1,423	$	(207	)	$	(4,549	)	$	81,012
Balances at December 31, 2015
Assets	$	7,229,764	$	35,793	$	33,541		$	12,256		$	7,311,354
Loans	5,029,072		35,469		15,153			(11,609		)	5,068,085
Deposits	5,447,293		4,627		—			(104,278		)	5,347,642

Operating results for the year ended December 31, 2014 (In thousands)
	PNB		GFSC			SEPH			All Other			Total
Net interest income (loss)	$	218,641	$	7,457		$	958		$	(2,012	)	$	225,044
Provision for (recovery of) loan losses	3,517		1,544			(12,394		)	—			(7,333		)
Other income (loss)	69,384		(1		)	5,991			175			75,549
Other expense	163,641		4,103			11,766			8,000			187,510
Income (loss) before taxes	120,867		1,809			7,577			(9,837		)	120,416
Income taxes (benefit)	37,960		634			2,652			(4,787		)	36,459
Net income (loss)	$	82,907	$	1,175		$	4,925		$	(5,050	)	$	83,957
Balances at December 31, 2014
Assets	$	6,910,386	$	40,308		$	43,762		$	6,743		$	7,001,199
Loans	4,781,761		40,645			23,956			(16,680		)	4,829,682
Deposits	5,222,766		5,883			—			(100,649		)	5,128,000

F- 63

Notes to Consolidated Financial Statements

The following is a reconciliation of financial information for the reportable segments to the Corporation’s consolidated totals:

	2016
(In thousands)	Net Interest Income			Depreciation Expense		Other Expense		Income Taxes			Assets			Deposits
Totals for reportable segments	$	238,224		$	8,396	$	180,896	$	41,117		$	7,447,148		$	5,634,008
Elimination of intersegment items	2,164			—		—		—			(9,204		)	(112,052		)
Parent Co. totals - not eliminated	(2,302		)	—		9,731		(4,357		)	29,642			—
Totals	$	238,086		$	8,396	$	190,627	$	36,760		$	7,467,586		$	5,521,956

	2015
(In thousands)	Net Interest Income			Depreciation Expense		Other Expense		Income Taxes			Assets			Deposits
Totals for reportable segments	$	227,393		$	7,347	$	169,295	$	37,238		$	7,299,098		$	5,451,920
Elimination of intersegment items	2,561			—		—		—			(13,557		)	(104,278		)
Parent Co. totals - not eliminated	(2,322		)	—		9,972		(4,671		)	25,813			—
Totals	$	227,632		$	7,347	$	179,267	$	32,567		$	7,311,354		$	5,347,642

	2014
(In thousands)	Net Interest Income			Depreciation Expense		Other Expense		Income Taxes			Assets			Deposits
Totals for reportable segments	$	227,056		$	7,243	$	172,267	$	41,246		$	6,994,456		$	5,228,649
Elimination of intersegment items	3,708			—		—		—			(18,556		)	(100,649		)
Parent Co. totals - not eliminated	(5,720		)	—		8,000		(4,787		)	25,299			—
Totals	$	225,044		$	7,243	$	180,267	$	36,459		$	7,001,199		$	5,128,000

28. Parent Company Statements

The Parent Company statements should be read in conjunction with the consolidated financial statements and the information set forth below. Investments in subsidiaries are accounted for using the equity method of accounting.

Cash represents non-interest bearing deposits with PNB. Net cash provided by operating activities reflects cash payments (received from subsidiaries) for income taxes of $4.4 million, $4.1 million and $5.8 million in 2016, 2015 and 2014, respectively.

At December 31, 2016 and 2015, shareholders’ equity reflected in the Parent Company balance sheet includes $259.7 million and $199.4 million, respectively, of undistributed earnings of the Corporation’s subsidiaries which are restricted from transfer as dividends to the Corporation.

F- 64

Notes to Consolidated Financial Statements

Balance Sheets
December 31, 2016 and 2015
(In thousands)	2016		2015
Assets:
Cash	$	112,067	$	102,416
Investment in subsidiaries	626,569		613,383
Debentures receivable from PNB	25,000		25,000
Other investments	2,962		2,341
Other assets	26,651		23,443
Total assets	$	793,249	$	766,583
Liabilities:
Subordinated notes	45,000		45,000
Other liabilities	6,009		8,228
Total liabilities	51,009		53,228
Total shareholders’ equity	742,240		713,355
Total liabilities and shareholders’ equity	$	793,249	$	766,583

Statements of Income
for the years ended December 31, 2016, 2015 and 2014
(In thousands)	2016			2015			2014
Income:
Dividends from subsidiaries	$	60,000		$	60,000		$	60,000
Interest and dividends	2,164			2,561			3,708
Other	1,081			560			262
Total income	63,245			63,121			63,970
Expense:
Other, net	12,159			12,341			13,807
Total expense	12,159			12,341			13,807
Income before federal taxes and equity in undistributed income of subsidiaries	51,086			50,780			50,163
Federal income tax benefit	4,357			4,671			4,787
Income before equity in undistributed income of subsidiaries	55,443			55,451			54,950
Equity in undistributed income of subsidiaries	30,692			25,561			29,007
Net income	$	86,135		$	81,012		$	83,957
Other comprehensive (loss) income (1)	(2,102		)	(2,035		)	21,811
Comprehensive income	84,033			78,977			105,768

(1) See Consolidated Statements of Comprehensive Income for other comprehensive (loss) income detail

F- 65

Notes to Consolidated Financial Statements

Statements of Cash Flows
for the years ended December 31, 2016, 2015 and 2014
(In thousands)	2016			2015			2014
Operating activities:
Net income	$	86,135		$	81,012		$	83,957
Adjustments to reconcile net income to net cash provided by operating activities:
Undistributed income of subsidiaries	(30,692		)	(25,561		)	(29,007		)
Compensation expense for issuance of treasury stock to directors	950			963			801
Share-based compensation expense	1,864			865			458
Increase in other assets	(3,425		)	(182		)	(1,292		)
(Decrease) increase in other liabilities	(2,524		)	485			298
Net cash provided by operating activities	52,308			57,582			55,215
Investing activities:
Repayment of investments in and advances to subsidiaries	15,000			10,000			32,000
Net cash provided by investing activities	15,000			10,000			32,000
Financing activities:
Cash dividends paid	(57,653		)	(57,776		)	(57,876		)
Repayment of subordinated notes	—			—			(35,250		)
Repurchase of treasury shares	—			(6,058		)	(2,355		)
Cash payment for fractional shares	(4		)	(3		)	(5		)
Net cash used in financing activities	(57,657		)	(63,837		)	(95,486		)
Increase (decrease) in cash	9,651			3,745			(8,271		)
Cash at beginning of year	102,416			98,671			106,942
Cash at end of year	$	112,067		$	102,416		$	98,671

F- 66

EX-14

Exhibit 14

PARK NATIONAL CORPORATION

CODE OF BUSINESS CONDUCT AND ETHICS

Adopted by the Board of Directors

January 16, 2001

Most Recently Reviewed by the Policy Owner

July 18, 2016

Most Recently Amended and Approved by the Board of Directors

July 25, 2016

If you have any comments or suggestions regarding the Code of Business Conduct and Ethics please contact Laura B. Lewis at (740) 349-3750. If you have comments or suggestions on overall policy administration or governance, please contact Brady Burt at (740) 322-6844.

Park National Corporation ("Park") is judged by the collective and individual performance of the directors/Advisory Board members (together, the “directors”), officers, associates, and agents of Park and its subsidiaries, including the respective bank divisions of The Park National Bank (collectively, the "Company"). Thus, these individuals traditionally have recognized that their first duty to the Company is to act in a manner that merits public trust and confidence.

As professionals, the Company's directors, officers, associates, and agents have earned a reputation for integrity and competence. They have been guided and judged by the highest standards of conduct. Over the years, these standards have been reaffirmed, despite new challenges and ever-changing social values. Integrity, honesty, public trust and confidence have served as crucial tests of our service and success.

This Code of Business Conduct and Ethics (the "Code of Ethics") has been adopted by the Board of Directors of Park to demonstrate to the public and the Company's various constituents the importance that Park's Board of Directors and leaders place on ethical conduct. The Code of Ethics is intended to set forth the Company's expectations for the conduct of ethical business practices by its directors, officers, associates, and agents to promote advance disclosure and review of potential conflicts of interest and similar matters, to protect and encourage the reporting of questionable behavior, to foster an atmosphere of self-awareness and prudent conduct and to discipline appropriately those who engage in improper conduct. The Code of Ethics is not presented to expand upon or change the ethical standards of the Company’s directors, officers, associates, and agents. It is not intended to be all-inclusive, and cannot address every situation that might arise. Rather its purpose is to reduce to writing many of the patterns of conduct that are expected at the Company. It represents a set of minimum standards. It is important to remember that our good reputation emerges from many actions and can be jeopardized by one.

You are required to read this Code of Ethics carefully. Should it be unclear, please seek guidance from your bank division President or the Chairman of the Board, the President, the Director of Human Resources, or the Internal Auditor of Park, for in matters such as these, appearance is often as important as reality. It is not only the letter but the spirit of the commitment that is important.

On an annual basis, directors and officers of the Company must re-read this Code of Ethics and provide written verification of such review by signing an appropriate acknowledgment form. New associates must read the Code of Ethics and sign the appropriate acknowledgment form during their orientation meeting. All associates must re-read the Code of Ethics (as amended) and sign new acknowledgment forms after any amendments are approved by the Board of Directors of Park.

If any associate wishes to anonymously report violations of this Code of Ethics, the Company has established the PRK Improvement Line, a confidential hotline which can be accessed at 1-800-418-6423 extension 775. In addition to reporting via telephone, associates may report online via www.securityvoice.com/reports. Both the telephone and online reporting methods are confidential, and an outside company is used to transmit the information to appropriate bank management. (In some cases, the Chair of the Audit Committee of the Board of Directors of Park (the “Audit Committee”) and/or the Park Audit Committee may receive such information directly.) However, any email that originates from a bank or Park email address (e.g., an associate’s work email) could be tracked later through computer system documentation, so for maximum confidentiality, it is suggested that a personal home computer be used for the online method of reporting.

Confidential Information

Perhaps the most crucial area of concern for bankers and regulatory authorities is the use and/or abuse of confidential information. Financial institutions by their very nature are privy to customers' business plans, forecasts, decisions, and problems. Bankers receive this information as an aid to providing more efficient, more knowledgeable service … and for no other reason.

The use of such information for one's own, or another’s, personal benefit constitutes an abuse which subjects an individual and the institution to statutory penalties.

Banks also possess considerable information which, though not necessarily confidential by nature, must nonetheless be treated confidentially if the right of privacy of customers and staff is to be safeguarded.

Therefore, confidential information with respect to the Company’s customers and suppliers acquired by an officer, director, associate, or agent of the Company, through his or her association with the Company, is considered to be privileged and must be held in the strictest confidence. It is to be used solely for corporate purposes and not as a basis for personal gain by the officer, director, associate or agent. In no case shall such information be transmitted to persons outside the Company, including family or other acquaintances, or even to other officers, directors, associates, or agents of the Company who do not need to know such information in discharging their duties as officers, directors, associates or agents.

The restrictions in this section shall also apply to the reports and statements prepared for use in the Company’s business and not generally released. The disclosure of material, non-public information to others can lead to significant legal consequences, fines, and punishment as well as termination of employment. Only specifically designated representatives of the Company may discuss any aspect of the Company’s business with the news media or the investment community. Officers, directors, associates, or agents may not under any circumstances provide information or discuss matters involving the Company with the news media or investment community even if contacted directly by a media organization or investment entity. All such contact or inquiries should be referred to the Chairman of the Board of Park, the President of Park, or their respective designee(s).

Company Assets and Intellectual Property

Company-owned assets (including but not limited to documents, electronic files, reports and records) and intellectual property (including but not limited to inventions, business ideas, unique products, methodologies and business strategies) are only to be used for corporate purposes and not for personal use or gain. All officers, directors, associates and agents are required to safeguard the Company’s property.

Conflicts of Interest

As directors, officers, associates, and agents within a financial services organization, we assume a duty to our communities, our customers and our shareholders. Such duty is to act in all matters in a manner that will merit public trust and confidence. This duty extends to all activities -- both personal and professional. Each person associated with the Company is expected to direct his or her personal conduct in a manner which will bring credit to the Company and to avoid any action which would discredit it.

In the exercise of privileges and authority arising from employment or other association with the Company, two fundamental principles apply: directors, officers, associates, and agents, when acting for, on behalf of, or in the name of the Company, will place the interests of the Company ahead of their own private interests, and directors, officers, associates, and agents have a duty to make full disclosure of any situation in which their private interests create a conflict or potential conflict with those of the Company.

Conflicts of interest occur when business judgments or decisions may be influenced by personal interests not shared by the organization as a whole. A conflict situation may, for example, arise when an individual, or a member of the individual’s family, has an interest in a transaction to which the Company is a party, competes with the Company or takes advantage of an opportunity that belongs to the Company.

When a conflict of interest arises, an officer, director, associate, or agent has a duty to place the Company's interests above his or her own personal interests. It is essential that in those instances where a Company decision or practice may appear to have been made to advance a personal interest, that the decision be made or approved by the independent and "disinterested" officers or directors of the Company. Thus, in those instances where an associate faces a potential conflict of interest, the associate should report the potential conflict of interest to a senior officer for his or her review. Any action or transaction in which the personal interest of an officer, director, or agent of the Company may be in conflict with those of the Company must be promptly reported to the Chair of the Park Audit Committee or through the PRK Improvement Line (see page 2). The Audit Committee shall review and oversee all actions and transactions which involve the personal interest of an associate, officer, or director and shall have the right to determine in advance that any such action or transaction does not constitute a conflict of interest in violation of this Code of Ethics.

It is considered a conflict of interest, which could result in termination of employment, if an associate of the Company makes a loan, prepares and/or processes any type of transaction (e.g., opens an account, completes a loan application, processes withdrawals, deposits, check cashing or payments), or waives fees and/or service charges for his/her own personal loans, accounts, or transactions, or those of immediate family members or intimate partners and persons living in the same household (roommate, boyfriend, girlfriend, etc.); and further extends to influencing another associate to prepare or process a transaction for which there is no direct request from the customer. It is each associate’s responsibility to exercise prudence and good judgment when making loans or processing transactions to or for anyone whose personal relationship with the associate may influence his/her judgment.

This policy is not meant to discourage relatives and/or friends of associates from banking with our Company. They should be afforded the same excellent service as other customers.

Additional direction on this subject is provided in the “Conflicts of Interest” booklet of the Comptroller’s Handbook (Office of the Comptroller of the Currency, January 2015).

Outside Activities

No outside activity may interfere or conflict with the interest of the Company. Acceptance of outside employment, election to directorships of other for-profit corporations, representation of customers in their dealings with our Company and participation in the affairs of all outside organizations carry possibilities of conflict of interest. No associate may serve as an official or director of any for-profit enterprise without obtaining written approval from the Chief Executive Officer of Park or the President of the respective bank division of The Park National Bank (“PNB”).

Associates of the Company should ask themselves the following questions when considering a job outside the Company: Is there a conflict of interest? Will it adversely affect my Company? Will the job interfere with the time and attention that must be devoted to my job duties, responsibilities, or other obligations at the Company? Will Company property or equipment or use of proprietary information (such as mailing lists, computer systems, etc.) be involved? If the answer to any of these questions is "yes," the second job cannot be accepted. Regardless of whether a conflict of interest exists, any outside employment must be communicated to the associate’s supervisor.

Service with constructive non-profit organizations and participation in civic affairs is strongly encouraged. There are cases, however, when organizations having business relationships with the Company or one of the bank divisions of PNB in which the handling of confidential information is involved might result in a conflict of interest. Associates must be sensitive to such potential conflicts.

Trusts

It is improper for an associate to accept appointment of or continue to act as a fiduciary or co-fiduciary in the case of any trust, estate, agency, guardianship or custodianship of a client of the Company, unless, the creator of the relationship, or the ward in the case of a guardianship, is or was at the time of death, a member of the associate’s immediate family. An associate shall not serve as a personal representative of an estate; act as a trustee of a trust, or guardian of a minor heir unless the client is a close relative or personal friend of the associate.

No associate shall accept appointment of or continue to act as a fiduciary or co-fiduciary in the case of any trust, estate, agency, guardianship or conservatorship of an estate or custodianship, or act as an investment counselor or estate appraiser (other than in the course of employment with the Company), unless the creator of the relationship -- or the ward in the case of a guardianship or conservatorship -- is a member of the associate’s immediate family or a close personal friend. This provision can be waived, on a case-by-case basis, by express written approval of the Chief Executive Officer of Park National Bank or the President of the respective bank division of Park National Corporation.

Associates must report to the Company any legacy or bequest to them under wills or trusts of clients (other than immediate family or relatives). The Park Audit Committee or the Park Board of Directors will evaluate such reports to assure that a conflict of interest does not exist. If a conflict does exist, the beneficiary associate may be expected to be relieved of the administration of the legacy and may be required to renounce the gift. Noncompliance with a Company directive on such a matter may be grounds for discipline or termination.

Gifts, Fees, Gratuities, and Other Payments from Customers or Suppliers

Some of our business acquaintances customarily distribute small gifts during the holidays and on other occasions. In the event of receipt of such gift or entertainment opportunity, each director, officer, associate, and agent (when acting for, on behalf of or in the name of the Company) must decide conscientiously whether or not acceptance would give rise to a feeling of obligation, or could lead to misinterpretation. Gifts, benefits, or unusual hospitality that might tend to influence one in the performance of his or her duty must not be accepted. Such gifts, benefits or unusual hospitality do not include gifts of nominal value, or gifts which serve as general advertising for the donor, or discounts or special concessions available to all associates, or hospitality which is casual and limited to a normal situation. As a further guide to what may or may not be acceptable, associates should ask themselves whether, in the judgment of business associates or disinterested parties, such acceptance might seem to impair their ability to act at all times solely in the best interests of the Company.

Federal law (including the Bank Bribery Amendments Act of 1985) prohibits officers, directors, associates and agents of the Company from (1) soliciting for themselves or for a third party (other than the respective Park subsidiary with which they are associated) anything of value from anyone in return for any business, service or confidential information of the Park subsidiary with which they are associated, and (2) accepting anything of value (other than a bona fide salary, wages and fees referred to in 18 U.S.C. § 215c) from anyone in connection with the business of the respective Park subsidiary with which they are associated, either before or after a transaction is discussed or consummated.

Additional direction on this subject is provided in the "Insider Activities" booklet of the Comptroller’s Handbook (Office of the Comptroller of the Currency, November 2013).

18 U.S.C. § 215 is intended to prevent a pay-off to officers, directors, associates or agents of a Park subsidiary as a quid pro quo either to induce a particular transaction or as a "gratuity" in support of a particular transaction. Thus, where a benefit is given or received as a result of a banking transaction, the statute may be violated. However, it is not intended to proscribe the receipt of gratuities or favors of nominal value when it is clear from the circumstances that (a) a customer is not trying to exert any influence over the officer, director, associate or agent of the Park subsidiary in connection with a transaction and (b) the gratuity or favor is, in fact, unsolicited.

If an officer, director, or agent receives a personal benefit that is not clearly reasonable and business-related, he/she must report it to the Park Audit Committee. If an associate receives a personal benefit that is not clearly reasonable and business-related, he/she must report it to the Chief Executive Officer of Park or the President of the respective bank division of PNB. The Park Audit Committee, Park’s Chief Executive Officer or the President of the respective bank division of PNB, as the case may be, shall have the right to determine in advance that any such personal benefit does not constitute a conflict of interest in violation of this Code of Ethics and/or to require that such personal benefit be returned to the provider and/or reimbursed by the Company.

Dealing Fairly With Customers, Suppliers, and Other Associates

No officer, director, associate, or agent of the Company should take unfair advantage of anyone through manipulation, concealment, abuse of privileged information, misrepresentation of material facts or any other unfair dealing practice. The Company does not sanction offering or making payments of any kind, whether of money, services or property, to any domestic or foreign public official or of providing personal benefits that are not clearly reasonable and business-related to any associate, agent or representative of any organization seeking to or doing business with the Company. If there is any question as to whether any such personal benefit is clearly reasonable and business-related, an officer, director, or agent should seek pre-approval from the Park Audit Committee, the Chief Executive Officer of Park or from the President of the respective bank division of PNB.

Competition

The Company believes that open and honest competition in the marketplace is healthy and must always be positive, not negative. Any collusion with competitors about the pricing of bank services, interest rates or otherwise engaging in any activity that has the effect, directly or indirectly, of lessening competition, is not permitted.

Associates should avoid portraying bank competitors, or the Company itself, in a negative or adverse way. Associates have a duty to portray the Company in the best possible light when communicating with clients, friends, neighbors and any current or potential clients.

Political Activities

Neither Park nor any of its subsidiaries will make any contribution or expenditure, either directly or indirectly, to, or for the benefit of, use of, in support of, or in opposition to, any political party, candidate, political committee, or for any non-public issue purpose. The Company will not reimburse any person for such contribution or expenditure. This policy relates to the use of corporate and/or affiliate funds only, and in no way is intended to discourage officers, directors, associates, and/or agents from making personal contributions to individual candidates, political parties, or political action committees.

The Company may make political loans in connection with campaigns provided that such loans are made in accordance with applicable banking laws, rules and regulations, in the ordinary course of business and according to loan policies, and in conformity with applicable federal, state and local laws, rules and regulations.

Directors, officers, associates, and agents of the Company may engage in political activity (serving, for example, as a campaign treasurer). Associates should inform the persons to whom they report and be very careful not to allow their activity to interfere with their work-related responsibilities. This means such activity would ordinarily be confined to the evenings and weekends and only occasionally and exceptionally would it be engaged in during business hours.

Any associate of the Company who is considering becoming a candidate for any elective public office, engaging in outside employment under any governmental unit, or being appointed to any governmental position should inform and obtain prior approval from the Chief Executive Officer of Park or the President of the respective bank division of PNB.

It is contrary to the Company’s Code of Ethics to permit the payment of funds of any subsidiary of Park, or use of Company property, either directly or indirectly to secure favored business treatment for the applicable subsidiary. In addition, Company property or funds cannot be used to support a campaign for public office. This includes the use of Company personnel and equipment such as telephones, copy machines, postage, etc.

Dishonesty and Breach of Trust

An officer, director, associate, or agent shall not use his/her position at the Company to commit an act that would be considered illegal (e.g. theft, falsifying records, forgery, check kiting, etc.).

All officers, directors, associates, and agents must conduct themselves with honesty and integrity at all times. Suspicious activities must be reported to the Internal Auditor or Security Officer of the Company or through the confidential PRK Improvement Line (see page 2.) Upon receipt of such report, the PRK Investigation Team, comprised of Internal Audit, Security, and Human Resources officers, will conduct an investigation. All officers, directors, associates, and agents are to cooperate with any investigation. Withholding information, lying to investigators, or impeding the investigation in any way, will be cause for immediate termination of employment. All legal violations will be referred to the appropriate police agency for prosecution.

Compliance With Applicable Laws, Rules and Regulations

The Company expects that each and every officer, director, associate, and agent of the Company will comply with all applicable federal, state, local and foreign laws, rules and regulations governing the Company's business, including insider trading laws. In addition, all officers, directors, associates, and agents are required to respond honestly and candidly when dealing with the Company’s independent auditors and internal auditors, regulators and attorneys.

While these principles are seemingly self-explanatory, at times the application of any particular law, rule or regulation to the Company may not be perfectly clear. Where an associate is unsure or has any question as to the application to the Company of any law, rule or regulation, it is expected that the associate will seek appropriate guidance from the President of the respective bank division of PNB, who may seek guidance from outside counsel to the Company. Officers, directors, and agents of the Company should seek guidance from the President of the respective bank division of PNB or from outside counsel to the Company. In addition, the Park Audit Committee is specifically empowered to engage non-Company counsel if or when it believes such engagement is prudent.

Dealing with Auditors, Examiners, Regulators and Legal Counsel

All officers, directors, associates and agents should respond and deal honestly, factually and candidly with the Company’s independent and internal auditors, regulators and attorneys.

It is of critical importance that Park’s filings with the Securities and Exchange Commission, banking regulators and other regulatory agencies and authorities, as well as our other public communications be complete, fair, accurate, timely, understandable and transparent. Depending on your position with the Company, you may be called upon to provide necessary information to assure that Park’s filings and public reports meet these standards.

The Company's books, records and accounts shall accurately and fairly reflect the transactions of the Company in reasonable detail and in accordance with the Company’s accounting practices and policies.

Personal Investments

In making personal investments, all officers, directors, associates, and agents shall be guided by a keen awareness of potential conflict. Generally speaking, one's own investments should not be such as to influence his or her judgment or action in the conduct of the Company's business or to profit from security transactions made for the Company’s customers.

An officer, director, associate, or agent should not enter into a security transaction for his or her own account under conditions where information not generally available to the public is made available to the Company on a confidential basis or for corporate purposes and is used as a basis for the individual's action; nor should the individual disclose such information to any unauthorized person. The Company has a comprehensive "Insider Trading Policy" which is applicable to all officers, directors, and associates of the Company as well as to each of their immediate family members. The Company expects that every officer, director, and associate will comply, and will cause their family members to comply, with every aspect of the Insider Trading Policy.

Personal Borrowing

Officers subject to Regulation O, as well as, associates and other officers of the Company may borrow from the bank, divisions of PNB or other financial institutions, provided all transactions are at arm's-length, at market prices, and control of the lending situation is clearly in the hands of the lender. An associate may not have lending authority over an account involving themselves, their immediate family, relatives or any related interests. Associates are not permitted to borrow from other customers or suppliers. This prohibition does not preclude the Company from entering into a lending relationship with an individual related to the associate by blood or marriage. Only officers subject to Regulation O must report to the Board of Directors of PNB.

It is the policy of the Company that credit standards will be consistent for all loan applications and existing clients regardless of race, color, national origin, religion, sex, sexual orientation, age, disability, marital status, veteran’s status or any other legally protected status, provided the applicant meets all other relevant criteria and the capacity to enter into a binding contract.

You must exhibit the highest caliber of ethical behavior and fiscal responsibility in your own banking relationship with the Company. Moreover, you are expected to abide by your financial obligations to the Company and to any financial institution from which you borrow. This includes ensuring your payments are made on time, sufficient funds are available in the account from which you are intending to withdraw the funds, and that your accounts remain in good standing at all times. Although the Company understands that there may be extraordinary circumstances from time to time that prevent you from meeting these obligations, it is expected that you take full responsibility for proactively communicating any issues to the Company so that appropriate arrangements can be made to address the problem at hand.

Annual Personal Financial Statements

Annual personal financial statements are required of all officers of the Company at year-end, including data for both the officer and his or her spouse. The very nature of a Company officer's job requires that full and complete financial disclosures be made on an annual basis, and more often as required.

The statements are to be submitted to the President of the bank division of PNB and will be made available to the Internal Auditor of Park and to the Chairman of the Board of Park and the President of Park as requested.

Employment of Relatives

Employment of relatives of current junior bank officers (defined as AVP, Banking Officer and Administrative Officer) and relatives of all non-officer associates of the Company is permitted. Employment of relatives of senior officers (defined as Vice President and above) may be approved on a case-by-case basis by the President or the Chairman of the Board of Park, but such approval will still preclude the relatives from working within the same department and/or having a reporting relationship. (See third and fourth paragraphs below for specific guidance about children of senior officers.)

Occasionally, the Company may employ both spouses, although they will be prohibited from working in the same department or branch office and may not have a reporting relationship.Supervisors/managers/leaders at any level should not hire, promote or directly supervise a family member/relative or common law or domestic partner.

The children of senior officers (Vice President and above) and directors may be employed as temporary help during their student years in any bank division of PNB or other subsidiary of the Company, including that of the senior officer or director parent, but they are not permitted to report directly to the senior officer parent.

Children of senior officers and directors of Park and each of the bank divisions of PNB are only permitted to have permanent employment in a separate PNB bank division or Park subsidiary other than that of the senior officer or director parent. Additionally, the position held by children of senior officers cannot have a reporting relationship to the senior officer parent at another PNB bank division. Exceptions may be made by the President of the respective PNB bank division and either Park’s Chairman of the Board or Park’s President.

Giving Advice to Clients

Clients may occasionally request an opinion on legal or tax transactions. The Company cannot practice law or give legal or tax advice. Accordingly, associates must take care in discussing such transactions so as not to give the impression or allow the client to interpret such discussions as providing legal or tax advice.

Privacy Principles

The Company is committed to protecting customer privacy and the confidentiality of all customer information. The Company follows the American Bankers Association’s “Principles of Banking”, as described below:

1. Recognition of a Customer’s Expectation of Privacy

The Company will recognize and respect the privacy expectations of our customers and explain principles of financial privacy to our customers in an appropriate fashion.

2. Use, Collection and Retention of Customer Information

The Company will collect, retain, and use information about individual customers only where we reasonably believe it would be useful (and allowed by law) to administering our business and to provide products, services and other opportunities to our customers.

3. Maintenance of Accurate Information

The Company will maintain procedures so that our customers’ financial information is accurate, current and complete in accordance with reasonable commercial standards. We will also respond to requests to correct inaccurate information in a timely manner.

4. Limiting Associate Access to Information

The Company will take reasonable steps to limit access by our associates to personally identifiable information to those with a business reason for knowing such information. We will continue to educate our associates so that they will understand the importance of confidentiality and customer privacy. We will also take appropriate disciplinary measures to enforce associate privacy responsibilities.

5. Protection of Information via Established Security Procedures

The Company will maintain appropriate security standards and procedures regarding unauthorized access to customer information.

6. Restrictions on the Disclosure of Account Information

The Company will not reveal specific information about customer accounts or other personally identifiable data to unaffiliated third parties for their independent use, except for the exchange of information with reputable information reporting agencies to maximize the accuracy and security of such information in the performance of bona fide corporate due diligence, unless (1) the information is provided to help complete a customer-initiated transaction; (2) the customer requests it; (3) the disclosure is required or allowed by any applicable law, rule or regulation (i.e. subpoena, investigation of fraudulent activity, etc.); or (4) the customer has been informed about the possibility of such disclosure for marketing or similar purposes through a prior communication and is given the opportunity to decline (i.e. "opt out").

7. Maintaining Customer Privacy in Business Relationships with Third Parties

If personally identifiable customer information is provided to a third party, the Company will insist that the third party adhere to similar Privacy Principles that provide for keeping such information confidential.

8. Disclosure of Privacy Principles to Customers

The Company will devise methods of providing our customers with an understanding of our privacy policies.

Assistance in Meeting the Company's Accounting, Financial Reporting and Disclosure Obligations

In compliance with the rules and regulations of the U.S. Securities and Exchange Commission and NYSE MKT LLC (“NYSE MKT”), the Company is required to issue financial statements in conformity with generally accepted accounting principles and then make public disclosures regarding certain aspects of its business. It is expected that all officers, directors, associates and agents of the Company will keep accurate and complete books, records and accounts that enable the Company to meet its accounting and financial reporting obligations. It is expected that any officer, director, associate or agent of the Company involved in preparing the Company's disclosures, or any associate or officer asked to provide information relevant to such disclosure, will work to ensure that our public reports and communications are fair, accurate, certifiable, complete, objective, relevant, timely, and understandable. Any associate or officer who, in good faith, believes that the Company's accounting method is inappropriate or not in compliance with generally accepted accounting principles, or has concerns about any questionable accounting or auditing matter or any other accounting, internal accounting control or auditing matter, should report this finding directly to Park's Chief Financial Officer and, if unsatisfied with the response, directly to the Park Audit Committee. The Park Audit Committee has established a procedure for such reports that ensures the confidentiality of the reporting person. Refer to page 2 for information on the PRK Improvement Line.

In addition, any officer or associate who becomes aware of a material event or fact involving the Company that has not been previously disclosed publicly by the Company should immediately report such material event or fact to Park's Chief Financial Officer, Park’s Chief Executive Officer or the President of the respective PNB bank division.

Post-Employment Activities

At the time of termination or resignation, departing officers, directors, associates, and agents will be required to return all Company property in their possession or control, including but not limited to electronic or written Company documents, electronic files, reports and records containing any Company or nonpublic information, along with all copies thereof. A departed officer, director, associate, or agent remains obligated by law not to disclose to any third party or use for his/her own purposes any confidential or proprietary information to which the officer, director, associate, or agent had access while employed by the Company. A departed officer, director, associate, or agent is also expected not to disparage the Company or engage in activity that damages the Company’s reputation or business, since such activity may also be unlawful.

Violations of Policies

There are many other policies that are very important to the Company and its operations. Nothing herein shall relieve any officer, director, associate, or agent of the Company from complying with all other applicable company policies.

Violations of any of the Company's board-approved policies may be cause for disciplinary action, including termination of employment.

The Company expects full compliance with this Code of Ethics. In that regard, associates are encouraged to report any violation of the Code of Ethics to their supervisor, Internal Audit Department, Human Resources representative or to the President of their respective PNB bank division. Officers and directors must report any violation of the Code of Ethics to the Park Audit Committee. Officers, directors, associates, and agents may also report suspected violations of the Code of Ethics to a senior officer, Human Resources, Internal Audit, or the PRK Improvement Line. The Company will not permit any retaliation against an officer, director, associate, or agent who properly reports (to the appropriate personnel) a matter that he or she believes, in good faith, to be a violation of the Code of Ethics. Reports to the Park Audit Committee may be made on a confidential basis. Any officer, director, associate, or agent who is found to have violated the Code of Ethics may be subject to discipline, including termination of employment.

The Park Audit Committee shall investigate any alleged violation of the Code of Ethics by any of the Company's officers, directors, associates, or agents. In the event that the Park Audit Committee determines that a violation of the Code of Ethics has occurred, the Park Audit Committee shall be authorized to take any action it deems appropriate. If the violation involves an executive officer or director of Park, the Park Audit Committee shall notify Park's Board of Directors and Park's Board of Directors shall take such action as it deems appropriate. In the event that Park's Board of Directors recognizes that a violation by an executive officer or a director of Park has occurred but elects not to take any remedial or other action against the offending executive officer or director, Park shall disclose the facts and circumstances of its election to waive the Code of

Ethics by posting the same on Park's web site or by any other such means as may be required under applicable laws, rules and regulations or the requirements of the Securities and Exchange Commission or NYSE MKT.

Also, nothing in this Code of Ethics affects the general policy of the Company that employment is at will and can be terminated by the Company or the associate at any time and for any or no reason.

ASSOCIATE'S ACKNOWLEDGMENT

OF PARK NATIONAL CORPORATION

CODE OF BUSINESS CONDUCT AND ETHICS

The foregoing Code of Business Conduct and Ethics (the "Code of Ethics") will not answer or resolve every question you may have. If you are uncertain about what the right thing to do is, you are encouraged to seek the advice and guidance of your supervisor, your Human Resources representative or the President of your respective PNB bank division.

YOU MAY ALWAYS DIRECTLY REPORT ANY MATTER WHICH YOU BELIEVE, IN GOOD FAITH, TO BE A VIOLATION OF THE FOREGOING CODE OF ETHICS TO PARK’S CHIEF EXECUTIVE OFFICER OR TO THE AUDIT COMMITTEE OF PARK'S BOARD OF DIRECTORS ON A CONFIDENTIAL BASIS. YOU MAY ALSO CONTACT THE PRK IMPROVEMENT LINE AT 1-800-418-6423 (Ext. 775) OR VIA THE WEBSITE AT www.securityvoice.com/reports.

I have read and understand the foregoing Code of Ethics, have been given a copy to retain for my reference, and agree to be bound by its terms. I understand I can be subject to discipline, dismissal from my job and prosecution under the law for violating any of the above provisions of the Code of Ethics.

________________________________________            ___________________    

Print Name                                Last 4 digits of Social Security Number

________________________________________            _____/_____/_____    

Signature                                 Date

OFFICER'S ACKNOWLEDGMENT

OF PARK NATIONAL CORPORATION

CODE OF BUSINESS CONDUCT AND ETHICS

The foregoing Code of Business Conduct and Ethics (the "Code of Ethics") will not answer or resolve every question you may have. If you are uncertain about what the right thing to do is, you are encouraged to seek the advice and guidance of the President of your respective PNB bank division.

YOU MAY ALWAYS DIRECTLY REPORT ANY MATTER WHICH YOU BELIEVE, IN GOOD FAITH, TO BE A VIOLATION OF THE FOREGOING CODE OF ETHICS TO PARK'S CHIEF EXECUTIVE OFFICER OR TO THE AUDIT COMMITTEE OF PARK'S BOARD OF DIRECTORS ON A CONFIDENTIAL BASIS. YOU MAY ALSO CONTACT THE PRK IMPROVEMENT LINE AT 1-800-418-6423 (Ext. 775) OR VIA THE WEBSITE AT www.securityvoice.com/reports.

I have read and understand the foregoing Code of Ethics, have been given a copy to retain for my reference, and agree to be bound by its terms. I understand I may be subject to discipline, dismissal from my job and prosecution under the law for violating any of the above provisions of the Code of Ethics.

________________________________________            ___________________    

Print Name                                Last 4 digits of Social Security Number

________________________________________            _____/_____/_____    

Signature                                 Date

DIRECTOR'S ACKNOWLEDGMENT

OF PARK NATIONAL CORPORATION

CODE OF BUSINESS CONDUCT AND ETHICS

The foregoing Code of Business Conduct and Ethics (the "Code of Ethics") will not answer or resolve every question you may have. If you are uncertain about what the right thing to do is, you are encouraged to seek the advice and guidance of outside counsel to Park National Corporation ("Park") or other counsel designated by the Audit Committee of the Board of Directors of Park.

YOU MAY ALWAYS DIRECTLY REPORT ANY MATTER WHICH YOU BELIEVE, IN GOOD FAITH, TO BE A VIOLATION OF THE FOREGOING CODE OF ETHICS TO THE AUDIT COMMITTEE OF PARK’S BOARD OF DIRECTORS OR THE FULL BOARD OF DIRECTORS.

I have read and understand the foregoing Code of Ethics, have been given a copy to retain for my reference, and agree to be bound by its terms. I understand I can be subject to discipline, removal for cause from the Board of Directors and prosecution under the law for violating any of the above provisions of the Code of Ethics.

________________________________________            ___________________    

Print Name                                Last 4 digits of Social Security Number

________________________________________            _____/_____/_____    

Signature                                 Date

EX-21

Exhibit 21

SUBSIDIARIES OF PARK NATIONAL CORPORATION

Name of Subsidiary		Jurisdiction of Incorporation or Formation
The Park National Bank (“PNB”)		United States (federally-chartered national banking association)
•	Park Investments, Inc. (NOTE: is a wholly-owned subsidiary of PNB)	Delaware
•	Scope Leasing, Inc. (NOTE: is a wholly-owned subsidiary of PNB) [Also does business under “Scope Aircraft Finance”]	Ohio
•	River Park Properties, LLC (NOTE: is a wholly-owned subsidiary of PNB)	Ohio
•	Sunny Green, LLC (NOTE: is a wholly-owned subsidiary of PNB)	Ohio
•	The following are the divisions of PNB:
	∗ Fairfield National Bank (also sometimes known as “Fairfield National Division”)	n/a
	∗ The Park National Bank of Southwest Ohio & Northern Kentucky	n/a
	∗ Century National Bank	n/a
	∗ Second National Bank	n/a
	∗ Richland Bank (also sometimes known as “The Richland Trust Company”)	n/a
	∗ United Bank, N.A.	n/a
	∗ First-Knox National Bank (also sometimes known as “The First-Knox National Bank of Mount Vernon”)	n/a
	∗ Farmers Bank (also sometimes known as “Farmers and Savings”)	n/a
	∗ Security National Bank (also sometimes known as “The Security National Bank and Trust Co.” or “Security National Bank & Trust Company”)	n/a
	∗ Unity National Bank	n/a
Guardian Financial Services Company [Also does business under “Guardian Finance Company”]		Ohio

Name of Subsidiary		Jurisdiction of Incorporation or Formation
Park Title Agency, LLC. (NOTE: Park National Corporation holds 80% of ownership interest and other member, which is not a subsidiary of Park National Corporation, holds 20% of ownership interest)		Ohio
SE Property Holdings, LLC ("SEPH")		Ohio
•	Vision-Park Properties, L.L.C. (NOTE: SEPH is sole member)	Florida
•	87A Orange Beach, LLC (NOTE: SEPH is sole member)	Ohio
•	Morningside Holding, LLC (NOTE: SEPH is sole member)	Ohio
•	Swindall Holdings, LLC (NOTE: SEPH is sole member)	Ohio
•	Swindall Partnership Holdings, LLC (NOTE: SEPH is sole member)	Ohio
•	Marina Holdings Z, LLC (NOTE: SEPH is sole member)	Ohio
•	Marina Holding WE, LLC (NOTE: SEPH is sole member)	Ohio
Vision Bancshares Trust I (NOTE: Park holds all of the common securities as successor Depositor; floating rate preferred securities are held by institutional investors)		Delaware

EX-23

Exhibit 23

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We consent to the incorporation by reference in the following Registration Statements of Park National Corporation:

Form S-8 No.  33-92060

Form S-8 No.  333-52653

Form S-8 No.  333-59360

Form S-8 No.  333-59378

Form S-8 No.  333-91178

Form S-8 No.  333-168334

Form S-8 No.  333-188323

Form S-3 No. 333-207137

of our report dated February 21, 2017, relating to the consolidated financial statements and effectiveness of internal control over financial reporting, appearing in this Annual Report on Form 10-K.

Crowe Horwath LLP

Columbus, Ohio

February 21, 2017

EX-24

Exhibit 24

POWER OF ATTORNEY

The undersigned officer and director of Park National Corporation, an Ohio corporation (the “Corporation”), which anticipates filing with the Securities and Exchange Commission, Washington, D.C., under the provisions of the Securities Exchange Act of 1934, as amended, the Annual Report of the Corporation on Form 10-K for the fiscal year ended December 31, 2016, hereby constitutes and appoints C. Daniel DeLawder and Brady T. Burt, and each of them, with full power of substitution and resubstitution, as attorney-in-fact and agent to execute, deliver and file, in his name and on his behalf, in any and all capacities, such Annual Report on Form 10‑K and any and all amendments thereto, and any and all applications or documents to be filed with the Securities and Exchange Commission pertaining to such Annual Report on Form 10-K, with full power and authority to do and perform any and all acts and things whatsoever required and necessary to be done in the premises, as fully to all intents and purposes as he could do if personally present. The undersigned hereby ratifies and confirms all that each said attorney-in-fact and agent, or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

IN WITNESS WHEREOF, the undersigned has executed this Power of Attorney this 23rd day of January, 2017.

/s/ David L. Trautman

David L. Trautman

POWER OF ATTORNEY

The undersigned officer and director of Park National Corporation, an Ohio corporation (the “Corporation”), which anticipates filing with the Securities and Exchange Commission, Washington, D.C., under the provisions of the Securities Exchange Act of 1934, as amended, the Annual Report of the Corporation on Form 10-K for the fiscal year ended December 31, 2016, hereby constitutes and appoints David L. Trautman and Brady T. Burt, and each of them, with full power of substitution and resubstitution, as attorney-in-fact and agent to execute, deliver and file, in his name and on his behalf, in any and all capacities, such Annual Report on Form 10‑K and any and all amendments thereto, and any and all applications or documents to be filed with the Securities and Exchange Commission pertaining to such Annual Report on Form 10-K, with full power and authority to do and perform any and all acts and things whatsoever required and necessary to be done in the premises, as fully to all intents and purposes as he could do if personally present. The undersigned hereby ratifies and confirms all that each said attorney-in-fact and agent, or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

IN WITNESS WHEREOF, the undersigned has executed this Power of Attorney this 23rd day of January, 2017.

/s/ C. Daniel DeLawder

C. Daniel DeLawder

POWER OF ATTORNEY

The undersigned officer of Park National Corporation, an Ohio corporation (the “Corporation”), which anticipates filing with the Securities and Exchange Commission, Washington, D.C., under the provisions of the Securities Exchange Act of 1934, as amended, the Annual Report of the Corporation on Form 10-K for the fiscal year ended December 31, 2016, hereby constitutes and appoints C. Daniel DeLawder and David L. Trautman, and each of them, with full power of substitution and resubstitution, as attorney-in-fact and agent to execute, deliver and file, in his name and on his behalf, in any and all capacities, such Annual Report on Form 10‑K and any and all amendments thereto, and any and all applications or documents to be filed with the Securities and Exchange Commission pertaining to such Annual Report on Form 10-K, with full power and authority to do and perform any and all acts and things whatsoever required and necessary to be done in the premises, as fully to all intents and purposes as he could do if personally present. The undersigned hereby ratifies and confirms all that each said attorney-in-fact and agent, or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

IN WITNESS WHEREOF, the undersigned has executed this Power of Attorney this 23rd day of January, 2017.

/s/ Brady T. Burt

Brady T. Burt

POWER OF ATTORNEY

The undersigned officer of Park National Corporation, an Ohio corporation (the “Corporation”), which anticipates filing with the Securities and Exchange Commission, Washington, D.C., under the provisions of the Securities Exchange Act of 1934, as amended, the Annual Report of the Corporation on Form 10-K for the fiscal year ended December 31, 2016, hereby constitutes and appoints C. Daniel DeLawder, David L. Trautman and Brady T. Burt, and each of them, with full power of substitution and resubstitution, as attorney-in-fact and agent to execute, deliver and file, in his name and on his behalf, in any and all capacities, such Annual Report on Form 10‑K and any and all amendments thereto, and any and all applications or documents to be filed with the Securities and Exchange Commission pertaining to such Annual Report on Form 10-K, with full power and authority to do and perform any and all acts and things whatsoever required and necessary to be done in the premises, as fully to all intents and purposes as he could do if personally present. The undersigned hereby ratifies and confirms all that each said attorney-in-fact and agent, or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

IN WITNESS WHEREOF, the undersigned has executed this Power of Attorney this 23rd day of January, 2017.

/s/ Matthew R. Miller

Matthew R. Miller

POWER OF ATTORNEY

The undersigned director of Park National Corporation, an Ohio corporation (the “Corporation”), which anticipates filing with the Securities and Exchange Commission, Washington, D.C., under the provisions of the Securities Exchange Act of 1934, as amended, the Annual Report of the Corporation on Form 10-K for the fiscal year ended December 31, 2016, hereby constitutes and appoints C. Daniel DeLawder, David L. Trautman and Brady T. Burt, and each of them, with full power of substitution and resubstitution, as attorney-in-fact and agent to execute, deliver and file, in her name and on her behalf, in any and all capacities, such Annual Report on Form 10‑K and any and all amendments thereto, and any and all applications or documents to be filed with the Securities and Exchange Commission pertaining to such Annual Report on Form 10-K, with full power and authority to do and perform any and all acts and things whatsoever required and necessary to be done in the premises, as fully to all intents and purposes as she could do if personally present. The undersigned hereby ratifies and confirms all that each said attorney-in-fact and agent, or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

IN WITNESS WHEREOF, the undersigned has executed this Power of Attorney this 23rd day of January, 2017.

/s/ Donna M. Alvarado

Donna M. Alvarado

POWER OF ATTORNEY

The undersigned director of Park National Corporation, an Ohio corporation (the “Corporation”), which anticipates filing with the Securities and Exchange Commission, Washington, D.C., under the provisions of the Securities Exchange Act of 1934, as amended, the Annual Report of the Corporation on Form 10-K for the fiscal year ended December 31, 2016, hereby constitutes and appoints C. Daniel DeLawder, David L. Trautman and Brady T. Burt, and each of them, with full power of substitution and resubstitution, as attorney-in-fact and agent to execute, deliver and file, in his name and on his behalf, in any and all capacities, such Annual Report on Form 10‑K and any and all amendments thereto, and any and all applications or documents to be filed with the Securities and Exchange Commission pertaining to such Annual Report on Form 10-K, with full power and authority to do and perform any and all acts and things whatsoever required and necessary to be done in the premises, as fully to all intents and purposes as he could do if personally present. The undersigned hereby ratifies and confirms all that each said attorney-in-fact and agent, or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

IN WITNESS WHEREOF, the undersigned has executed this Power of Attorney this 23rd day of January, 2017.

/s/ James R. DeRoberts

James R. DeRoberts

POWER OF ATTORNEY

The undersigned director of Park National Corporation, an Ohio corporation (the “Corporation”), which anticipates filing with the Securities and Exchange Commission, Washington, D.C., under the provisions of the Securities Exchange Act of 1934, as amended, the Annual Report of the Corporation on Form 10-K for the fiscal year ended December 31, 2016, hereby constitutes and appoints C. Daniel DeLawder, David L. Trautman and Brady T. Burt, and each of them, with full power of substitution and resubstitution, as attorney-in-fact and agent to execute, deliver and file, in his name and on his behalf, in any and all capacities, such Annual Report on Form 10‑K and any and all amendments thereto, and any and all applications or documents to be filed with the Securities and Exchange Commission pertaining to such Annual Report on Form 10-K, with full power and authority to do and perform any and all acts and things whatsoever required and necessary to be done in the premises, as fully to all intents and purposes as he could do if personally present. The undersigned hereby ratifies and confirms all that each said attorney-in-fact and agent, or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

IN WITNESS WHEREOF, the undersigned has executed this Power of Attorney this 23rd day of January, 2017.

/s/ F. William Englefield IV

F. William Englefield IV

POWER OF ATTORNEY

The undersigned director of Park National Corporation, an Ohio corporation (the “Corporation”), which anticipates filing with the Securities and Exchange Commission, Washington, D.C., under the provisions of the Securities Exchange Act of 1934, as amended, the Annual Report of the Corporation on Form 10-K for the fiscal year ended December 31, 2016, hereby constitutes and appoints C. Daniel DeLawder, David L. Trautman and Brady T. Burt, and each of them, with full power of substitution and resubstitution, as attorney-in-fact and agent to execute, deliver and file, in her name and on her behalf, in any and all capacities, such Annual Report on Form 10‑K and any and all amendments thereto, and any and all applications or documents to be filed with the Securities and Exchange Commission pertaining to such Annual Report on Form 10-K, with full power and authority to do and perform any and all acts and things whatsoever required and necessary to be done in the premises, as fully to all intents and purposes as she could do if personally present. The undersigned hereby ratifies and confirms all that each said attorney-in-fact and agent, or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

IN WITNESS WHEREOF, the undersigned has executed this Power of Attorney this 23rd day of January, 2017.

/s/ Alicia J. Hupp

Alicia J. Hupp

POWER OF ATTORNEY

The undersigned director of Park National Corporation, an Ohio corporation (the “Corporation”), which anticipates filing with the Securities and Exchange Commission, Washington, D.C., under the provisions of the Securities Exchange Act of 1934, as amended, the Annual Report of the Corporation on Form 10-K for the fiscal year ended December 31, 2016, hereby constitutes and appoints C. Daniel DeLawder, David L. Trautman and Brady T. Burt, and each of them, with full power of substitution and resubstitution, as attorney-in-fact and agent to execute, deliver and file, in his name and on his behalf, in any and all capacities, such Annual Report on Form 10‑K and any and all amendments thereto, and any and all applications or documents to be filed with the Securities and Exchange Commission pertaining to such Annual Report on Form 10-K, with full power and authority to do and perform any and all acts and things whatsoever required and necessary to be done in the premises, as fully to all intents and purposes as he could do if personally present. The undersigned hereby ratifies and confirms all that each said attorney-in-fact and agent, or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

IN WITNESS WHEREOF, the undersigned has executed this Power of Attorney this 23rd day of January, 2017.

/s/ Stephen J. Kambeitz

Stephen J. Kambeitz

POWER OF ATTORNEY

The undersigned director of Park National Corporation, an Ohio corporation (the “Corporation”), which anticipates filing with the Securities and Exchange Commission, Washington, D.C., under the provisions of the Securities Exchange Act of 1934, as amended, the Annual Report of the Corporation on Form 10-K for the fiscal year ended December 31, 2016, hereby constitutes and appoints C. Daniel DeLawder, David L. Trautman and Brady T. Burt, and each of them, with full power of substitution and resubstitution, as attorney-in-fact and agent to execute, deliver and file, in his name and on his behalf, in any and all capacities, such Annual Report on Form 10‑K and any and all amendments thereto, and any and all applications or documents to be filed with the Securities and Exchange Commission pertaining to such Annual Report on Form 10-K, with full power and authority to do and perform any and all acts and things whatsoever required and necessary to be done in the premises, as fully to all intents and purposes as he could do if personally present. The undersigned hereby ratifies and confirms all that each said attorney-in-fact and agent, or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

IN WITNESS WHEREOF, the undersigned has executed this Power of Attorney this 23rd day of January, 2017.

/s/ Timothy S. McLain

Timothy S. McLain

POWER OF ATTORNEY

The undersigned director of Park National Corporation, an Ohio corporation (the “Corporation”), which anticipates filing with the Securities and Exchange Commission, Washington, D.C., under the provisions of the Securities Exchange Act of 1934, as amended, the Annual Report of the Corporation on Form 10-K for the fiscal year ended December 31, 2016, hereby constitutes and appoints C. Daniel DeLawder, David L. Trautman and Brady T. Burt, and each of them, with full power of substitution and resubstitution, as attorney-in-fact and agent to execute, deliver and file, in his name and on his behalf, in any and all capacities, such Annual Report on Form 10‑K and any and all amendments thereto, and any and all applications or documents to be filed with the Securities and Exchange Commission pertaining to such Annual Report on Form 10-K, with full power and authority to do and perform any and all acts and things whatsoever required and necessary to be done in the premises, as fully to all intents and purposes as he could do if personally present. The undersigned hereby ratifies and confirms all that each said attorney-in-fact and agent, or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

IN WITNESS WHEREOF, the undersigned has executed this Power of Attorney this 23rd day of January, 2017.

/s/ Robert E. O'Neill

Robert E. O'Neill

POWER OF ATTORNEY

The undersigned director of Park National Corporation, an Ohio corporation (the “Corporation”), which anticipates filing with the Securities and Exchange Commission, Washington, D.C., under the provisions of the Securities Exchange Act of 1934, as amended, the Annual Report of the Corporation on Form 10-K for the fiscal year ended December 31, 2016, hereby constitutes and appoints C. Daniel DeLawder, David L. Trautman and Brady T. Burt, and each of them, with full power of substitution and resubstitution, as attorney-in-fact and agent to execute, deliver and file, in her name and on her behalf, in any and all capacities, such Annual Report on Form 10‑K and any and all amendments thereto, and any and all applications or documents to be filed with the Securities and Exchange Commission pertaining to such Annual Report on Form 10-K, with full power and authority to do and perform any and all acts and things whatsoever required and necessary to be done in the premises, as fully to all intents and purposes as she could do if personally present. The undersigned hereby ratifies and confirms all that each said attorney-in-fact and agent, or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

IN WITNESS WHEREOF, the undersigned has executed this Power of Attorney this 23rd day of January, 2017.

/s/ Julia A. Sloat

Julia A. Sloat

POWER OF ATTORNEY

The undersigned director of Park National Corporation, an Ohio corporation (the “Corporation”), which anticipates filing with the Securities and Exchange Commission, Washington, D.C., under the provisions of the Securities Exchange Act of 1934, as amended, the Annual Report of the Corporation on Form 10-K for the fiscal year ended December 31, 2016, hereby constitutes and appoints C. Daniel DeLawder, David L. Trautman and Brady T. Burt, and each of them, with full power of substitution and resubstitution, as attorney-in-fact and agent to execute, deliver and file, in his name and on his behalf, in any and all capacities, such Annual Report on Form 10‑K and any and all amendments thereto, and any and all applications or documents to be filed with the Securities and Exchange Commission pertaining to such Annual Report on Form 10-K, with full power and authority to do and perform any and all acts and things whatsoever required and necessary to be done in the premises, as fully to all intents and purposes as he could do if personally present. The undersigned hereby ratifies and confirms all that each said attorney-in-fact and agent, or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

IN WITNESS WHEREOF, the undersigned has executed this Power of Attorney this 23rd day of January, 2017.

/s/ Rick R. Taylor

Rick R. Taylor

POWER OF ATTORNEY

The undersigned director of Park National Corporation, an Ohio corporation (the “Corporation”), which anticipates filing with the Securities and Exchange Commission, Washington, D.C., under the provisions of the Securities Exchange Act of 1934, as amended, the Annual Report of the Corporation on Form 10-K for the fiscal year ended December 31, 2016, hereby constitutes and appoints C. Daniel DeLawder, David L. Trautman and Brady T. Burt, and each of them, with full power of substitution and resubstitution, as attorney-in-fact and agent to execute, deliver and file, in his name and on his behalf, in any and all capacities, such Annual Report on Form 10‑K and any and all amendments thereto, and any and all applications or documents to be filed with the Securities and Exchange Commission pertaining to such Annual Report on Form 10-K, with full power and authority to do and perform any and all acts and things whatsoever required and necessary to be done in the premises, as fully to all intents and purposes as he could do if personally present. The undersigned hereby ratifies and confirms all that each said attorney-in-fact and agent, or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

IN WITNESS WHEREOF, the undersigned has executed this Power of Attorney this 23rd day of January, 2017.

/s/ Leon Zazworsky

Leon Zazworsky

EX-31.1

Exhibit 31.1

Rule 13a-14(a)/15d-14(a) Certifications

[Principal Executive Officer]

CERTIFICATIONS

I, David L. Trautman, certify that:

1. I have reviewed this Annual Report on Form 10-K for the fiscal year ended December 31, 2016, of Park National Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date:  February 21, 2017	By:	/s/ David L. Trautman
	Printed Name: David L. Trautman
	Title: Chief Executive Officer and President

EX-31.2

Exhibit 31.2

Rule 13a-14(a)/15d-14(a) Certifications

[Principal Financial Officer]

CERTIFICATIONS

I, Brady T. Burt, certify that:

1. I have reviewed this Annual Report on Form 10-K for the fiscal year ended December 31, 2016, of Park National Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date:   February 21, 2017	By:	/s/ Brady T. Burt
	Printed Name: Brady T. Burt
	Title: Chief Financial Officer, Secretary, and Treasurer

EX-32.1

Exhibit 32

CERTIFICATIONS PURSUANT TO

SECTION 1350 OF CHAPTER 63 OF

TITLE 18 OF THE UNITED STATES CODE*

In connection with the Annual Report of Park National Corporation (the “Company”) on Form 10-K for the fiscal year ended December 31, 2016 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), the undersigned David L. Trautman, Chief Executive Officer and President of the Company, and Brady T. Burt, Chief Financial Officer, Secretary, and Treasurer of the Company, certify, pursuant to Section 1350 of Chapter 63 of Title 18 of the United States Code, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to the best of each of our respective knowledge:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

(2) The information contained in the Report fairly presents, in all material respects, the consolidated financial condition and results of operations of the Company and its subsidiaries.

/s/ David L. Trautman	/s/ Brady T. Burt
David L. Trautman	Brady T. Burt
Chief Executive Officer and President (Principal Executive Officer)	Chief Financial Officer, Secretary, and Treasurer (Principal Financial Officer)
Dated: February 21, 2017	Dated: February 21, 2017

*    These certifications are being furnished as required by Rule 13a – 14(b) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and Section 1350 of Chapter 63 of Title 18 of the United States Code, and shall not be deemed “filed” for purposes of Section 18 of the Exchange Act or otherwise subject to the liability of that Section.

These certifications shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act, except to the extent that the Company specifically incorporates these certifications by reference.

XML

Document And Entity Information - USD ($)	12 Months Ended
	Dec. 31, 2016	Feb. 17, 2017	Jun. 30, 2016
Entity Information [Line Items]
Document Type	10-K
Amendment Flag	false
Document Period End Date	Dec. 31, 2016
Document Fiscal Year Focus	2016
Document Fiscal Period Focus	FY
Entity Registrant Name	PARK NATIONAL CORP /OH/
Entity Central Index Key	0000805676
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Entity Well-known Seasoned Issuer	Yes
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Common Stock, Shares Outstanding		15,290,709
Entity Public Float			$ 1,379,303,140

XML

Consolidated Balance Sheets - USD ($) $ in Thousands	Dec. 31, 2016	Dec. 31, 2015
Assets:
Cash and due from banks	$ 122,811	$ 119,412
Money market instruments	23,635	30,047
Cash and cash equivalents	146,446	149,459
Investment securities:
Securities available-for-sale, at fair value (amortized cost of $1,262,761 and $1,436,714 at December 31, 2016 and 2015, respectively)	1,258,139	1,436,266
Securities held-to-maturity, at amortized cost (fair value of $256,672 and $151,428 at December 31, 2016 and 2015, respectively)	259,833	149,302
Other investment securities	61,811	58,311
Total investment securities	1,579,783	1,643,879
Total loans	5,271,857	5,068,085
Allowance for loan losses	(50,624)	(56,494)
Net loans	5,221,233	5,011,591
Other assets:
Bank owned life insurance	185,234	181,684
Prepaid assets	88,874	80,635
Goodwill	72,334	72,334
Premises and equipment, net	57,971	59,493
Affordable housing tax credit investments	52,947	51,247
Accrued interest receivable	18,822	18,675
Other real estate owned	13,926	18,651
Mortgage loan servicing rights	9,266	9,008
Other	20,750	14,698
Total other assets	520,124	506,425
Total assets	7,467,586	7,311,354
Deposits:
Non-interest bearing	1,523,417	1,404,032
Interest bearing	3,998,539	3,943,610
Total deposits	5,521,956	5,347,642
Short-term borrowings	394,795	394,242
Long-term debt	694,281	738,105
Subordinated notes	45,000	45,000
Total borrowings	1,134,076	1,177,347
Other liabilities:
Accrued interest payable	2,151	2,338
Unfunded commitments in affordable housing tax credit investments	14,282	20,311
Other	52,881	50,361
Total other liabilities	69,314	73,010
Total liabilities	6,725,346	6,597,999
Commitments and Contingencies
Shareholders’ equity:
Preferred Stock, Value, Issued	0	0
Common shares, no par value (20,000,000 shares authorized; 16,150,807 and 16,150,854 shares issued at December 31, 2016 and 2015, respectively)	305,826	303,966
Accumulated other comprehensive loss, net	(17,745)	(15,643)
Retained earnings	535,631	507,505
Less: Treasury shares (810,089 and 820,039 shares at December 31, 2016 and 2015, respectively)	(81,472)	(82,473)
Total shareholders’ equity	742,240	713,355
Total liabilities and shareholders’ equity	$ 7,467,586	$ 7,311,354

XML

Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands	Dec. 31, 2016	Dec. 31, 2015
Amortized cost of securities available-for-sale	$ 1,262,761	$ 1,436,714
Fair value of securities held-to-maturity	$ 256,672	$ 151,428
Preferred stock, shares authorized	200,000	200,000
Preferred stock, shares issued	0	0
Preferred stock per share liquidation preference	$ 0	$ 0
Common stock, no par value	$ 0	$ 0
Common stock, shares authorized	20,000,000	20,000,000
Common stock stock, shares issued	16,150,807	16,150,854
Treasury stock, shares	810,089	820,039

XML

Consolidated Statements of Income - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Interest and dividend income:
Interest and fees on loans	$ 241,979	$ 227,979	$ 227,644
Interest and dividends on:
Obligations of U.S. Government, its agencies and other securities	30,627	36,025	36,981
Obligations of states and political subdivisions	2,632	182	3
Other interest income	1,020	888	515
Total interest and dividend income	276,258	265,074	265,143
Interest on deposits:
Demand and savings deposits	4,079	2,229	1,677
Time deposits	9,337	10,125	9,323
Interest on short-term borrowings	456	469	517
Interest on long-term debt	24,300	24,619	28,582
Total interest expense	38,172	37,442	40,099
Net interest income	238,086	227,632	225,044
(Recovery of) provision for loan losses	(5,101)	4,990	(7,333)
Net interest income after (recovery of) provision for loan losses	243,187	222,642	232,377
Other income:
Income from fiduciary activities	21,400	20,195	19,150
Service charges on deposit accounts	14,259	14,751	15,423
Net gain on sales of securities	0	88	(1,158)
Other service income	14,419	11,438	10,459
Checkcard fee income	15,057	14,561	13,570
Bank owned life insurance income	4,338	5,783	4,861
ATM fees	2,268	2,428	2,467
Gain on sale of OREO, net	1,323	1,604	5,503
OREO valuation adjustments	(601)	(1,592)	(2,406)
Gain (Loss) on Sales of Loans, Net	0	756	1,867
Miscellaneous	6,268	7,539	5,813
Total other income	78,731	77,551	75,549
Other expense:
Salaries	87,034	86,189	81,977
Employee Benefit Expense	19,262	21,296	19,991
Data processing fees	5,608	5,037	4,712
Professional fees and services	27,181	23,452	29,580
Occupancy expense	10,239	9,686	10,006
Furniture and equipment expense	13,766	11,806	11,571
Insurance	5,825	5,629	5,723
Marketing	4,523	3,983	4,371
Communication	4,985	5,130	5,268
State tax expense	3,560	3,566	2,290
OREO expense	1,021	1,446	2,063
Prepayment penalty on long-term debt	5,554	532	0
Miscellaneous	10,465	8,862	9,958
Total other expense	199,023	186,614	187,510
Income (loss) before taxes	122,895	113,579	120,416
Federal income taxes	36,760	32,567	36,459
Net income	$ 86,135	$ 81,012	$ 83,957
Earnings per common share:
Basic (in dollars per share)	$ 5.62	$ 5.27	$ 5.45
Diluted (in dollars per share)	$ 5.59	$ 5.26	$ 5.45

XML

Statements of Comprehensive Income - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Net income	$ 86,135	$ 81,012	$ 83,957
Other Comprehensive (Income) Loss, Reclassification Adjustment from AOCI, Pension and Other Postretirement Benefit Plans, Net of Tax	(502)	(424)	(12)
Other Comprehensive (Income) Loss, Pension and Other Postretirement Benefit Plans, Adjustment, before Reclassification Adjustments, Net of Tax	(109)	910	9,279
Other comprehensive income (loss), net of income tax:
Changes in pension plan assets and benefit obligations recognized in other comprehensive income	611	(486)	(9,267)
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI for Sale of Securities, before Tax	0	0	753
Other Comprehensive Income (Loss), Available-for-sale Securities Adjustment, before Reclassification Adjustments, Net of Tax	(2,713)	(1,549)	30,325
Other Comprehensive Income (Loss), Available-for-sale Securities Adjustment, Net of Tax	(2,713)	(1,549)	31,078
Other Comprehensive Income (Loss), Net of Tax	(2,102)	(2,035)	21,811
Comprehensive income	$ 84,033	$ 78,977	$ 105,768

XML

Statements of Comprehensive Income (Parenthetical) - USD ($)	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Other Comprehensive (Income) Loss, Reclassification Adjustment from AOCI, Pension and Other Postretirement Benefit Plans, Net of Tax	$ 502,000	$ 424,000	$ 12,000
Tax Effect
Amortization of net loss and prior service costs, tax expense	271	228	7
Other Comprehensive Income (Loss), Pension and Other Postretirement Benefit Plans, Net Unamortized Gain (Loss) Arising During Period, Tax	59	(490)	(4,997)
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI for Sale of Securities, Tax	0	0	405
Unrealized net holding gain (loss) on securities available-for-sale, tax expense	(1,461)	(834)	16,329
Other Comprehensive (Income) Loss, Pension and Other Postretirement Benefit Plans, Adjustment, before Reclassification Adjustments, Net of Tax	$ 109,000	$ (910,000)	$ (9,279,000)

XML

Consolidated Statements of Changes in Stockholders' Equity - USD ($) $ in Thousands	Total	Preferred Shares	Common Shares	Retained Earnings	Treasury Stock	Accumulated Other Comprehensive (Loss) Income
Beginning balance at Dec. 31, 2013		$ 0	$ 302,651	$ 458,719	$ (76,128)	$ (35,419)
Beginning balance, shares at Dec. 31, 2013		0	15,411,952
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	$ 83,957			83,957
Other comprehensive income (loss), net of income tax:
Other Comprehensive Income (Loss), Net of Tax	$ 21,811					21,811
Cash dividends				(57,949)
Fractional shares issued in dividend reinvestment plan, shares			(53)
Cash payment for fractional shares in dividend reinvestment plan			$ (5)
Allocated Share-based Compensation Expense			$ 458
Treasury Stock, Shares, Acquired			(29,700)
Treasury Stock, Value, Acquired, Cost Method					2,355
Treasury Stock Reissued Shares For Director Grants	10,200		10,200
Treasury shares reissued for director grants				(243)	1,044
Ending balance at Dec. 31, 2014		$ 0	$ 303,104	484,484	(77,439)	(13,608)
Ending balance, shares at Dec. 31, 2014		0	15,392,399
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	$ 81,012			81,012
Other comprehensive income (loss), net of income tax:
Other Comprehensive Income (Loss), Net of Tax	$ (2,035)					(2,035)
Cash dividends				(57,930)
Fractional shares issued in dividend reinvestment plan, shares			(34)
Cash payment for fractional shares in dividend reinvestment plan			$ (3)
Allocated Share-based Compensation Expense			$ 865
Treasury Stock, Shares, Acquired			(71,700)
Treasury Stock, Value, Acquired, Cost Method					(6,058)
Treasury Stock Reissued Shares For Director Grants	10,150		10,150
Treasury shares reissued for director grants				(61)	1,024
Ending balance at Dec. 31, 2015	$ 713,355	$ 0	$ 303,966	507,505	(82,473)	(15,643)
Ending balance, shares at Dec. 31, 2015		0	15,330,815
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	86,135			86,135
Other comprehensive income (loss), net of income tax:
Other Comprehensive Income (Loss), Net of Tax	$ (2,102)					(2,102)
Cash dividends				(57,958)
Fractional shares issued in dividend reinvestment plan, shares			(47)
Cash payment for fractional shares in dividend reinvestment plan			$ (4)
Allocated Share-based Compensation Expense			$ 1,864
Treasury Stock, Shares, Acquired			0
Treasury Stock Reissued Shares For Director Grants	9,950		9,950
Treasury shares reissued for director grants				(51)	1,001
Ending balance at Dec. 31, 2016	$ 742,240	$ 0	$ 305,826	$ 535,631	$ (81,472)	$ (17,745)
Ending balance, shares at Dec. 31, 2016		0	15,340,718

XML

Consolidated Statements of Changes In Stockholders' Equity (Parenthetical) - $ / shares	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Cash dividends on common stock per share	$ 3.76	$ 3.76	$ 3.76

XML

Consolidated Statements of Cash Flows - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Interest Paid	$ 38,359	$ 37,655	$ 40,449
Operating activities:
Net income	86,135	81,012	83,957
Adjustments to reconcile net income to net cash provided by operating activities:
(Recovery of) provision for loan losses	(5,101)	4,990	(7,333)
Amortization of loan fees and costs, net	7,332	6,440	4,160
Provision for depreciation	8,396	7,347	7,243
Amortization (accretion) of investment securities, net	247	(226)	(213)
Amortization of prepayment penalty on long term debt	6,176	6,047	5,031
Prepayment penalty on long-term debt	5,554	532	0
Deferred income tax	581	(250)	2,528
Realized net investment security (gains) losses	0	0	1,158
Loan originations to be sold in secondary market	(287,722)	(220,800)	(136,125)
Proceeds from sale of loans in secondary market	290,132	222,785	135,209
Gain on sale of loans in secondary market	0	(756)	(1,867)
Proceeds from Sale of Other Loans Held-for-sale	0	900	20,966
Share-based Compensation	2,814	1,828	1,259
OREO valuation adjustments	601	1,592	2,406
Gains (Losses) on Sales of Other Real Estate	(1,323)	(1,604)	(5,503)
Proceeds from Sale of Other Real Estate	8,704	17,058	27,798
Bank owned life insurance income	(4,338)	(5,783)	(4,861)
Changes in assets and liabilities:
Increase in other assets	(18,086)	(10,978)	(18,313)
Increase in other liabilities	2,006	1,173	5,689
Net cash provided by operating activities	87,887	89,234	71,743
Proceeds from Life Insurance Policies	1,050	6,340	2,221
Investing activities:
Proceeds from Sale of Federal Home Loan Bank Stock	0	0	8,946
Proceeds from sales of securities	0	3,144	173,123
Proceeds from calls and maturities of securities:
Held-to-maturity	29,901	36,393	41,436
Available-for-sale	753,325	321,146	99,092
Purchase of securities:
Held-to-maturity	(141,045)	(48,226)	0
Available-for-sale	(579,006)	(457,617)	(350,934)
Payments to Acquire Other Investments	(3,500)	0	(1,350)
Net loan originations, portfolio loans	199,494	247,882	234,017
Payments for Affordable Housing Programs	(15,029)	(5,318)	(9,417)
Payments to Acquire Life Insurance Policies	0	10,045	0
Purchases of premises and equipment, net	(7,466)	(11,361)	(7,444)
Net cash used in investing activities	(152,560)	(395,468)	(229,580)
Financing activities
Net increase in deposits	174,314	219,642	338,006
Net increase in short-term borrowings	553	117,262	34,951
Proceeds from issuance of long-term debt	0	25,000	125,000
Repayment of subordinated notes	0	0	(35,250)
Repayment of long-term debt	(55,554)	(80,076)	(153,970)
Cash dividends paid	(57,653)	(57,776)	(57,876)
Net cash provided by financing activities	61,660	217,994	248,506
(Decrease) increase in cash and cash equivalents	(3,013)	(88,240)	90,669
Cash and cash equivalents at beginning of year	149,459	237,699	147,030
Cash and cash equivalents at end of year	146,446	149,459	237,699
Income Taxes Paid	27,260	26,140	27,810
Non cash activities [Abstract]
Real Estate Owned, Transfer to Real Estate Owned	3,339	13,447	12,780
Transfer of Portfolio Loans and Leases to Held-for-sale	0	144	21,985
Affordable Housing Program Obligation, Period Increase (Decrease)	9,000	9,000	8,000
Mortgage Loans on Real Estate [Member]
Adjustments to reconcile net income to net cash provided by operating activities:
Gain (Loss) on Sale of Loans and Leases	5,517	4,027	2,682
Held-to-maturity Securities [Member]
Adjustments to reconcile net income to net cash provided by operating activities:
Realized net investment security (gains) losses		(88)
Treasury Stock, Common [Member]
Financing activities
Treasury Stock, Value, Acquired, Cost Method	$ 0	$ (6,058)	$ (2,355)

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Summary of Significant Accounting Policies

12 Months Ended

Dec. 31, 2016

Accounting Policies [Abstract]

Summary of Significant Accounting Policies

Summary of Significant Accounting Policies

The following is a summary of significant accounting policies followed in the preparation of the consolidated financial statements:

Principles of Consolidation

The consolidated financial statements include the accounts of Park National Corporation and its subsidiaries (“Park”, the “Company” or the “Corporation”). Material intercompany accounts and transactions have been eliminated.

Use of Estimates

The preparation of financial statements in conformity with U.S. generally accepted accounting principles ("GAAP") requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could differ from those estimates.

Reclassifications

Certain prior year amounts have been reclassified to conform with the current year presentation. These reclassifications had no impact on net income or shareholders' equity.

Restrictions on Cash and Due from Banks

The Corporation’s national bank subsidiary is required to maintain average reserve balances with the Federal Reserve Bank. The average required reserve balance was approximately $51.6 million at December 31, 2016 and $44.2 million at December 31, 2015. No other compensating balance arrangements were in existence at December 31, 2016.

Investment Securities

Investment securities are classified upon acquisition into one of three categories: held-to-maturity ("HTM"), available-for-sale ("AFS"), or trading (see Note 4 - Investment Securities).

HTM securities are those securities that the Corporation has the positive intent and ability to hold to maturity and are recorded at amortized cost. AFS securities are those securities that would be available to be sold in the future in response to the Corporation’s liquidity needs, changes in market interest rates, and asset-liability management strategies, among other reasons. AFS securities are reported at fair value, with unrealized holding gains and losses excluded from earnings but included in other comprehensive income (loss), net of applicable income taxes. The Corporation did not hold any trading securities during any period presented.

AFS and HTM securities are evaluated quarterly for potential other-than-temporary impairment. Management considers the facts related to each security including the nature of the security, the amount and duration of the loss, the credit quality of the issuer, the expectations for that security’s performance and whether Park intends to sell, or it is more likely than not that Park will be required to sell, a security in an unrealized loss position before recovery of its amortized cost basis. Declines in the value of equity securities that are considered to be other-than-temporary are recorded as a charge to earnings in the Consolidated Statements of Income. Declines in the value of debt securities that are considered to be other-than-temporary are separated into (1) the amount of the total impairment related to credit loss and (2) the amount of the total impairment related to all other factors. The amount of the total other-than-temporary impairment related to the credit loss is recognized in earnings. The amount of the total other-than-temporary impairment related to all other factors is recognized in other comprehensive income (loss), net of income tax.

Interest income from investment securities includes amortization of purchase premium or discount. Premiums and discounts on securities are amortized on the level-yield method without anticipating prepayments, except for mortgage-backed securities where prepayments are anticipated.

Gains and losses realized on the sale of investment securities are recorded on the trade date and determined using the specific identification basis.

Federal Home Loan Bank ("FHLB") and Federal Reserve Bank ("FRB") Stock

Park’s national bank subsidiary, The Park National Bank ("PNB"), is a member of the FHLB. Additionally, PNB is a member of the FRB. Members are required to own a certain amount of stock based on their level of borrowings and other factors and may invest in additional amounts. FHLB stock and FRB stock are classified as restricted securities and are carried at their redemption value within other investment securities on the Consolidated Balance Sheets. Impairment is evaluated based on the ultimate recovery of par value. Both cash and stock dividends are reported as income.

Bank Owned Life Insurance

Park has purchased insurance policies on the lives of directors and certain key officers. Bank owned life insurance is recorded at its cash surrender value (or the amount that can be realized).

Loans Held for Sale

Generally, loans held for sale are carried at the lower of cost or fair value. Park has elected the fair value option for mortgage loans held for sale, which are carried at their fair value as of each balance sheet date.

Mortgage Banking Derivatives

Commitments to fund mortgage loans (interest rate locks) to be sold into the secondary market and forward commitments for the future delivery of these mortgage loans are accounted for as free standing derivatives. The fair values of these mortgage derivatives are estimated based on changes in mortgage interest rates from the date the interest rate on the loan is locked. The Company enters into forward commitments for the future delivery of mortgage loans when interest rate locks are entered into, in order to hedge the change in interest rates resulting from its commitments to fund the loans. Changes in the fair values of these derivatives are included in net gains on sale of loans.

Loans

Loans that management has the intent and ability to hold for the foreseeable future or until maturity or payoff, are reported at their outstanding principal balances adjusted for any charge-offs, any deferred fees or costs on originated loans, and any unamortized premiums or discounts on purchased loans. Interest income is accrued on the unpaid principal balance. Net deferred loan origination fees and costs are deferred and recognized in interest income using the level-yield method without anticipating prepayments.

Commercial loans include: (1) commercial, financial and agricultural loans; (2) commercial real estate loans; (3) those commercial loans in the real estate construction loan segment; and (4) those commercial loans in the residential real estate loan segment. Consumer loans include: (1) mortgage and installment loans included in the real estate construction segment; (2) mortgage, home equity lines of credit ("HELOCs"), and installment loans included in the residential real estate segment; and (3) all loans included in the consumer segment.

Generally, commercial loans are placed on nonaccrual status at 90 days past due and consumer and residential mortgage loans are placed on nonaccrual status at 120 days past due. Commercial loans placed on nonaccrual status are considered impaired (see Note 5 - Loans). For loans which are on nonaccrual status, it is Park’s policy to reverse interest previously accrued on the loans against interest income. Interest on such loans may be recorded on a cash basis and be included in earnings only when Park expects to receive the entire recorded investment of the loan. Park’s charge-off policy for commercial loans requires management to establish a specific reserve or record a charge-off as soon as it is apparent that the borrower is troubled and there is, or likely will be, a collateral shortfall related to the estimated value of the collateral securing the loan. The Company’s charge-off policy for consumer loans is dependent on the class of the loan. Residential mortgage loans, HELOCs, and consumer loans secured by residential real estate are typically charged down to the value of the collateral, less estimated selling costs, at 180 days past due. The charge-off policy for other consumer loans, primarily installment loans, requires a monthly review of delinquent loans and a complete charge-off for any account that reaches 120 days past due.

The delinquency status of a loan is based on contractual terms and not on how recently payments have been received. Loans may be removed from nonaccrual status when loan payments have been received to cure the delinquency status, the borrower has demonstrated the ability to maintain current payment status in accordance with the loan agreement and the loan is deemed to be well-secured by management.

A description of each segment of the loan portfolio, along with the risk characteristics of each segment, is included below:

Commercial, financial and agricultural:Commercial, financial and agricultural loans are made for a wide variety of general corporate purposes, including financing for commercial and industrial businesses, financing for equipment, inventories and accounts receivable, acquisition financing and commercial leasing. The term of each commercial loan varies by its purpose. Repayment terms are structured such that commercial loans will be repaid within the economic useful life of the underlying asset. The commercial loan portfolio includes loans to a wide variety of corporations and businesses across many industrial classifications originated in the 28 Ohio counties where PNB operates. The primary industries represented by these customers include manufacturing, retail trade, health care and other services.

Commercial real estate:Commercial real estate (“CRE”) loans include mortgage loans to developers and owners of commercial real estate. The lending policy for CRE loans is designed to address the unique risk attributes of CRE lending. The collateral for these CRE loans is the underlying commercial real estate.

Construction real estate: The Company defines construction loans as both commercial construction loans and residential construction loans where the loan proceeds are used exclusively for the improvement of real estate as to which the Company holds a mortgage. Construction loans may be in the form of a permanent loan or short-term construction loan, depending on the needs of the individual borrower. Construction financing is generally considered to involve a higher degree of risk of loss than long-term financing on improved, occupied real estate. Risk of loss on a construction loan depends largely upon the accuracy of the initial estimate of the property’s value at completion of construction and the estimated cost (including interest) of construction. If the estimate of construction cost proves to be inaccurate, the PNB division making the loan may be required to advance funds beyond the amount originally committed to permit completion of the project. If the estimate of value proves inaccurate, the PNB division may be confronted, at or prior to the maturity of the loan, with a project having a value insufficient to assure full repayment, should the borrower default. In the event that a default on a construction loan occurs and foreclosure follows, the PNB division must take control of the project and attempt to either arrange for completion of construction or dispose of the unfinished project. Additional risk exists with respect to loans made to developers who do not have a buyer for the property, as the developer may lack funds to pay the loan if the property is not sold upon completion. PNB and its divisions attempt to reduce such risks on loans to developers by requiring personal guarantees and reviewing current personal financial statements and tax returns as well as other projects undertaken by the developer.

Residential real estate:The Company defines residential real estate loans as first mortgages on individuals’ primary residences or second mortgages of individuals’ primary residences in the form of HELOCs or installment loans. Credit approval for residential real estate loans requires demonstration of sufficient income to repay the principal and interest and the real estate taxes and insurance, stability of employment, an established credit record and an appraised value of the real estate securing the loan.

Consumer:The Company originates direct and indirect consumer loans, primarily automobile loans, to customers in its primary market areas. Credit approval for consumer loans requires income sufficient to repay principal and interest due, stability of employment, an established credit record and sufficient collateral for secured loans. Consumer loans typically have shorter terms and lower balances with higher yields as compared to real estate mortgage loans, but generally carry higher risks of default. Consumer loan collections are dependent on the borrower’s financial stability, and thus are more likely to be affected by adverse personal circumstances.

Allowance for Loan Losses ("ALLL")

The allowance for loan losses is that amount believed adequate to absorb probable incurred credit losses in the loan portfolio based on management’s evaluation of various factors. The determination of the allowance requires significant estimates, including the timing and amounts of expected cash flows on impaired loans, consideration of current economic conditions, and historical loss experience pertaining to pools of homogeneous loans, all of which may be susceptible to change. The allowance is increased through a provision for loan losses that is charged to earnings based on management’s quarterly evaluation of the factors previously mentioned and is reduced by charge-offs, net of recoveries.

The allowance for loan losses includes both (1) an estimate of loss based on historical loss experience within both commercial and consumer loan categories with similar characteristics (“statistical allocation”) and (2) an estimate of loss based on an impairment analysis of each commercial loan that is considered to be impaired (“specific allocation”). Included in the statistical allocation is a reserve for troubled debt restructurings ("TDRs") within the consumer loan portfolio. Management performs a periodic evaluation to ensure the reserve calculated utilizing the statistical allocation is consistent with a reserve calculated under Accounting Standards Codification ("ASC") 310-10- Receivables.

In calculating the allowance for loan losses, management believes it is appropriate to consider historical loss rates that are comparable to the current period being analyzed, giving consideration to losses experienced over a full cycle. For the historical loss factor at December 31, 2016, the Company utilized an annual loss rate (“historical loss experience”), calculated based on an average of the net charge-offs and the annual change in specific reserves for impaired commercial loans, experienced during 2010 through 2016 within the individual segments of the commercial and consumer loan categories. Management believes the 84-month historical loss experience methodology is appropriate in the current economic environment, as it captures loss rates consistent with current expectations based on current economic conditions.

The loss factor applied to Park’s consumer loan portfolio as of December 31, 2016 was based on the historical loss experience over the past 84 months, plus an additional judgmental reserve, increasing the total allowance for loan loss coverage in the consumer loan portfolio to approximately 1.95 years of historical losses. The consumer loan portfolio loss coverage ratio was 1.99 years at December 31, 2015. Historical loss experience over the past 84 months for the consumer loan portfolio was 0.34% for 2016 and 0.42% for 2015.

The loss factor applied to Park’s commercial loan portfolio as of December 31, 2016 was based on the historical loss experience over the past 84 months, plus additional reserves for consideration of (1) a loss emergence period factor, (2) a loss migration factor and (3) a judgmental or environmental loss factor. These additional reserves increased the total allowance for loan loss coverage in the commercial loan portfolio to approximately 3.20 years of historical losses at December 31, 2016. The commercial loan portfolio loss coverage ratio was 2.37 years at December 31, 2015. Historical loss experience over the past 84 months for the commercial loan portfolio was 0.39% for 2016 and 0.53% for 2015. Park’s commercial loans are individually risk graded. If loan downgrades occur, the probability of default increases and accordingly management allocates a higher percentage reserve to those accruing commercial loans graded special mention and substandard.

The judgmental increases discussed above incorporate management’s evaluation of the impact of environmental qualitative factors which pose additional risks and assign a component of the allowance for loan losses in consideration of these factors. Such environmental factors include: national and local economic trends and conditions; experience, ability and depth of lending management and staff; effects of any changes in lending policies and procedures; and levels of, and trends in, consumer bankruptcies, delinquencies, impaired loans and charge-offs and recoveries.

GAAP requires a specific allocation to be established as a component of the allowance for loan losses for certain loans when it is probable that all amounts due pursuant to the contractual terms of the loans will not be collected, and the recorded investment in the loans exceeds their measure of impairment. Management considers the following related to commercial loans when determining if a loan should be considered impaired: (1) current debt service coverage levels of the borrowing entity; (2) payment history over the most recent 12-month period; (3) other signs of deterioration in the borrower’s financial situation, such as changes in credit scores; and (4) consideration of global cash flows of financially sound guarantors that have previously supported loan payments. The recorded investment is the carrying balance of the loan, plus accrued interest receivable, both as of the end of the year. Impairment is measured using either the present value of expected future cash flows based upon the initial effective interest rate on the loan, or the fair value of the collateral. If a loan is considered to be collateral dependent, the fair value of collateral, less estimated selling costs, is used to measure impairment.

Troubled Debt Restructuring

Management classifies loans as TDRs when a borrower is experiencing financial difficulty and Park has granted a concession. In order to determine whether a borrower is experiencing financial difficulty, an evaluation is performed of the probability that the borrower will be in payment default on any of the borrower's debt in the foreseeable future without the modification. This evaluation is performed under the Company’s internal underwriting policy. Management’s policy is to modify loans by extending the term or by granting a temporary or permanent contractual interest rate below the market rate, not by forgiving debt. A court's discharge of a borrower's debt in a Chapter 7 bankruptcy is considered a concession when the borrower does not reaffirm the discharged debt. TDRs are separately identified for impairment disclosures and are measured at the present value of estimated future cash flows using the loan’s effective rate at inception. If a TDR is considered to be a collateral dependent loan, the loan is reported, net, at the fair value of the collateral.

Income Recognition

Income earned by the Corporation and its subsidiaries is recognized on the accrual basis of accounting, except for nonaccrual loans as previously discussed, and late charges on loans which are recognized as income when they are collected.

Premises and Equipment

Land is carried at cost and is not subject to depreciation. Premises and equipment are carried at cost, less accumulated depreciation and amortization. Depreciation is generally provided on the straight-line method over the estimated useful lives of the related assets. Leasehold improvements are amortized over the shorter of the remaining lease period or the estimated useful lives of the improvements. Upon the sale or other disposal of an asset, the cost and related accumulated depreciation are removed from the accounts and the resulting gain or loss is recognized. Maintenance and repairs are charged to expense as incurred while renewals and improvements that extend the useful life of an asset are capitalized. Premises and equipment are evaluated for impairment whenever events or changes in circumstances indicate that the carrying amount of a particular asset may not be recoverable.

The range of depreciable lives over which premises and equipment are being depreciated are:

Buildings	30 Years
Equipment, furniture and fixtures	3 to 12 Years
Leasehold improvements	1 to 10 Years

Other Real Estate Owned ("OREO")

Management transfers a loan to OREO at the time that Park takes deed/title of the asset. OREO is initially recorded at fair value less anticipated selling costs (net realizable value), establishing a new cost basis, and consists of property acquired through foreclosure and real estate held for sale. If the net realizable value is below the carrying value of the loan at the date of transfer, the difference is charged to the allowance for loan losses. These assets are subsequently accounted for at the lower of cost or fair value less costs to sell. Subsequent changes in the value of real estate are classified as OREO valuation adjustments, are reported as adjustments to the carrying amount of OREO and are recorded within “Other income”. In certain circumstances where management believes the devaluation may not be permanent in nature, Park utilizes a valuation allowance to record OREO devaluations, which is also expensed through “Other income”. Costs relating to development and improvement of such properties are capitalized (not in excess of fair value less estimated costs to sell) and costs relating to holding the properties are charged to "Other expense".

Mortgage Servicing Rights ("MSR")

When Park sells mortgage loans with servicing rights retained, servicing rights are recorded at an amount not to exceed fair value with the income statement effect recorded in "Other service income." Capitalized servicing rights are amortized in proportion to and over the period of the estimated future servicing income of the underlying loan and are included within “Other service income”.

Mortgage servicing rights are assessed for impairment periodically, based on fair value, with any impairment recognized through a valuation allowance. The fair value of mortgage servicing rights is determined by discounting estimated future cash flows from the servicing assets, using market discount rates and expected future prepayment rates. In order to calculate fair value, the sold loan portfolio is stratified into homogeneous pools of like categories. (See Note 24 - Loan Servicing.)

Fees received for servicing mortgage loans owned by investors are based on a percentage of the outstanding monthly principal balance of such loans and are included in income as loan payments are received. The cost of servicing loans is charged to expense as incurred.

Goodwill

Goodwill represents the excess of the purchase price over net identifiable tangible and intangible assets acquired in a purchase business combination. Goodwill and indefinite-lived intangible assets are not amortized to expense, but are subject to impairment tests annually, or more frequently, if events or changes in circumstances indicate that the asset might be impaired, by assessing qualitative factors to determine whether the existence of events or circumstances leads to a determination that it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If after assessing these events or circumstances, it is concluded that it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, then performing the two-step impairment test is unnecessary. If the carrying amount of the goodwill exceeds the fair value, an impairment charge must be recorded in an amount equal to the excess.

Management considers several factors when performing the annual impairment tests on goodwill. The factors considered include the operating results for the particular Park segment for the past year and the operating results budgeted for the current year (including multi-year projections), the deposit and loan totals of the Park segment and the economic conditions in the markets served by the Park segment. At December 31, 2016, the goodwill remaining on Park's Consolidated Balance Sheet consisted entirely of goodwill at PNB. (See Note 27 - Segment Information for operating segment results.)

Park evaluates goodwill for impairment on April 1 of each year, with financial data as of March 31. Based on the analysis performed as of April 1, 2016, the Company determined that goodwill for Park’s national bank subsidiary (PNB) was not impaired. There have been no subsequent circumstances or events triggering an additional evaluation.

Goodwill in the amount of $72.3 million was recorded at each of December 31, 2016, 2015, and 2014.

Consolidated Statement of Cash Flows

Cash and cash equivalents include cash and cash items, amounts due from banks and money market instruments. Generally, money market instruments are purchased and sold for one-day periods.

Loss Contingencies and Guarantees

Loss contingencies, including claims and legal actions arising in the ordinary course of business, are recorded as liabilities when the likelihood of loss is probable and an amount or range of loss can be reasonably estimated.

Income Taxes

The Corporation accounts for income taxes using the asset and liability approach. Under this method, deferred tax assets and liabilities are determined based on differences between financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. To the extent that Park does not consider it more likely than not that a deferred tax asset will be recovered, a valuation allowance is recorded. All positive and negative evidence is reviewed when determining how much of a valuation allowance is recognized on a quarterly basis. A valuation allowance, if needed, reduces deferred tax assets to the amount expected to be realized.

An uncertain tax position is recognized as a benefit only if it is “more-likely-than-not” that the tax position would be sustained in a tax examination being presumed to occur. The benefit recognized for a tax position that meets the “more-likely-than-not” criteria is measured based on the largest benefit that is more than 50 percent likely to be realized, taking into consideration the amounts and probabilities of the outcome upon settlement. For tax positions not meeting the “more-likely-than-not” test, no tax benefit is recorded. Park recognizes any interest and penalties related to income tax matters in income tax expense.

Treasury Shares

The purchase of Park’s common shares to be held in treasury is recorded at cost. At the date of retirement or subsequent reissuance, the treasury shares account is reduced by the weighted average cost of the common shares retired or reissued.

Comprehensive Income

Comprehensive income consists of net income and other comprehensive income (loss). Other comprehensive income (loss) includes unrealized gains and losses on securities available for sale, and changes in the funded status of the Company’s defined benefit pension plan, which are also recognized as separate components of equity.

Share-Based Compensation

Compensation cost is recognized for restricted stock units and stock awards issued to employees and directors, respectively, based on the fair value of these awards at the date of grant. The market price of Park’s common shares at the date of grant is used to estimate the fair value of restricted stock units and stock awards. Compensation cost is recognized over the required service period, generally defined as the vesting period and is recorded in "Salaries" expense. (See Note 17-Share-Based Compensation.)

Loan Commitments and Related Financial Instruments

Financial instruments include off‑balance sheet credit instruments, such as commitments to make loans and commercial letters of credit, issued to meet customer financing needs. The face amount for these items represents the exposure to loss, before considering customer collateral or ability to repay. Such financial instruments are recorded when they are funded.

Fair Value Measurement

Fair values of financial instruments are estimated using relevant market information and other assumptions, as more fully disclosed in Note 25 - Fair Value. Fair value estimates involve uncertainties and matters of significant judgment regarding interest rates, credit risk, prepayments, and other factors, especially in the absence of broad markets for particular items. Changes in assumptions or in market conditions could significantly affect the estimates.

Transfers of Financial Assets

Transfers of financial assets are accounted for as sales, when control over the assets has been relinquished. Control over transferred assets is deemed to be surrendered when the assets have been isolated from the Company, the transferee obtains the right (free of conditions that constrain it from taking advantage of that right) to pledge or exchange the transferred assets, and the Company does not maintain effective control over the transferred assets through an agreement to repurchase them before their maturity.

Retirement Plans

Pension expense is the net of service and interest cost, return on plan assets and amortization of gains and losses not immediately recognized. Employee KSOP plan expense is the amount of matching contributions to Park's employees stock ownership plan. Deferred compensation and supplemental retirement plan expense allocates the benefits over years of service. (See Note 18 - Benefit Plans.)

Earnings Per Common Share

Basic earnings per common share is net income available to common shareholders divided by the weighted average number of common shares outstanding during the period. Diluted earnings per common share includes the dilutive effect of additional potential common shares issuable under stock awards, stock options, warrants and convertible securities. Earnings and dividends per common share are restated for any stock splits and stock dividends through the date of issuance of the consolidated financial statements. (See Note 21 - Earnings Per Common Share.)

Operating Segments

The Corporation is a financial holding company headquartered in Newark, Ohio. The operating segments for the Corporation are its chartered national bank subsidiary, PNB (headquartered in Newark, Ohio), SE Property Holdings, LLC ("SEPH"), and Guardian Financial Services Company ("GFSC").

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Adoption of New Accounting Pronouncements (Notes)

12 Months Ended

Dec. 31, 2016

New Accounting Pronouncements or Change in Accounting Principle [Line Items]

New Accounting Pronouncements and Changes in Accounting Principles [Text Block]

Adoption of New Accounting Pronouncements and Issued Not Yet Effective Accounting Standards

ASU 2014-09 - Revenue from Contracts with Customers (Topic 606): In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606). The ASU creates a new topic, Topic 606, to provide guidance on revenue recognition for entities that enter into contracts with customers to transfer goods or services or enter into contracts for the transfer of nonfinancial assets. The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. Additional disclosures are required to provide quantitative and qualitative information regarding the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The new guidance is effective for annual reporting periods, and interim reporting periods within those annual periods, beginning after December 15, 2017. While interest income is specifically out of scope of this standard, management is currently evaluating the revenue streams within "Other income" to assess the applicability of this standard. Specifically, management is evaluating the impact of this new guidance on deposit fees recorded within "Service Charges on Deposit Accounts" and trust income within "Income from Fiduciary Activities."

ASU 2015-02 - Consolidation (Topic 810): Amendments to the Consolidation Analysis: In February 2015, the FASB issued ASU 2015-02, Consolidation (Topic 810): Amendments to the Consolidation Analysis. The ASU amends the current consolidation guidance and affect both the variable interest entity and voting interest entity consolidation models. The new guidance is effective for annual reporting periods and interim reporting periods within those annual periods, beginning after December 15, 2015. The adoption of this guidance on January 1, 2016 did not have an impact on Park’s consolidated financial statements.

ASU 2016-01 - Financial Instruments - Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities. In January 2016, the FASB issued ASU 2016-01 - Financial Instruments - Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities. Changes to the current U.S. GAAP model primarily affect the accounting for equity investments, financial liabilities under the fair value option, and the presentation and disclosure requirements for financial instruments. In addition, the ASU clarifies guidance related to the valuation allowance assessment when recognizing deferred tax assets resulting from unrealized losses on available-for-sale securities. The new guidance is effective for annual reporting periods and interim reporting periods within those annual periods, beginning after December 15, 2017. The adoption of this guidance is not expected to have a material impact on Park's consolidated financial statements.

ASU 2016-02 - Leases (Topic 842): In February 2016, the FASB issued ASU 2016-02 - Leases (Topic 842). The ASU will require all organizations that lease assets to recognize on the balance sheet the assets and liabilities for the rights and obligations created by those leases. Additional qualitative and quantitative disclosures will be required so that users can understand more about the nature of an entity’s leasing activities. The new guidance is effective for annual reporting periods and interim reporting periods within those annual periods, beginning after December 15, 2018. Early adoption is permitted. Management is currently analyzing data on leased assets. The adoption of this guidance is expected to increase both assets and liabilities, but is not expected to have a material impact on Park's consolidated statement of income.

ASU 2016-09 - Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting: In March 2016, FASB issued ASU 2016-09 - Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting. The ASU provides simplification for several aspects of accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. The new guidance is effective for annual reporting periods and interim reporting periods within those annual periods, beginning after December 15, 2016. Early adoption was permitted. The adoption of this guidance on January 1, 2017 did not have a material impact on Park's consolidated financial statements.

ASU 2016-13 - Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments: In June 2016, FASB issued ASU 2016-13 - Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. The new guidance replaces the incurred loss model with an expected loss model, which is referred to as the current expected credit loss ("CECL") model. The CECL model is applicable to the measurement of credit losses on financial assets measured at amortized cost, including loan receivables, HTM debt securities, and reinsurance receivables. It also applies to off-balance sheet credit exposures not accounted for as insurance (loan commitments, standby letters of credit, financial guarantees, and other similar instruments) and net investments in leases recognized by a lessor. The CECL model requires an entity to estimate the credit losses over the life of an asset or off-balance sheet exposure. The new guidance is effective for annual reporting periods and interim reporting periods within those annual periods, beginning after December 15, 2019. Early adoption is permitted for annual reporting periods and interim reporting periods within those annual periods, beginning after December 15, 2018.

Management is currently evaluating the impact of the adoption of this guidance on Park's consolidated financial statements. We anticipate that the adoption of the CECL model will result in a material increase to Park's allowance for loan losses. Management has established a committee to oversee the implementation of CECL. This committee is currently assessing the data and system requirements necessary for adoption. Management plans to run our current model and a CECL model concurrently for 12 months prior to the adoption of this guidance on January 1, 2020.

ASU 2016-15 - Statement of Cash Flows (Topic 203): Classification of Certain Cash Receipts and Cash Payments (a consensus of the Emerging Issues Task Force):  In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 203): Classification of Certain Cash Receipts and Cash Payments (a consensus of the Emerging Issues Task Force).  This ASU provides guidance on eight specific cash flow issues where current GAAP is either unclear or does not include specific guidance. The new guidance is effective for annual reporting periods, and interim reporting periods within those annual periods, beginning after December 15, 2017.  As such transactions arise, management will utilize the updated guidance within Park’s consolidated statements of cash flows. 

ASU 2017-04 - Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment:  In January 2017, the FASB issued ASU 2017-04, Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment. This ASU eliminates Step 2 from the goodwill impairment test. Instead, under the new guidance, an entity should perform its annual goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An impairment charge would be recognized for the amount by which the carrying amount exceeds the reporting unit's fair value. The new guidance is effective for annual reporting periods, and interim reporting periods within those annual periods, beginning after December 15, 2019. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The adoption of this guidance is not expected to have an impact on Park's consolidated financial statements.

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Organization

12 Months Ended

Dec. 31, 2016

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Organization

Organization

Park National Corporation is a financial holding company headquartered in Newark, Ohio. Through its national bank subsidiary, PNB, Park is engaged in a general commercial banking and trust business, primarily in Ohio. PNB operates through eleven banking divisions with the Park National Bank Division headquartered in Newark, Ohio, the Fairfield National Bank Division headquartered in Lancaster, Ohio, The Park National Bank of Southwest Ohio & Northern Kentucky Division headquartered in Cincinnati, Ohio, the First-Knox National Bank Division headquartered in Mount Vernon, Ohio, the Farmers Bank Division headquartered in Loudonville, Ohio, the Security National Bank Division headquartered in Springfield, Ohio, the Unity National Bank Division headquartered in Piqua, Ohio, the Richland Bank Division headquartered in Mansfield, Ohio, the Century National Bank Division headquartered in Zanesville, Ohio, the United Bank, N.A. Division headquartered in Bucyrus, Ohio and the Second National Bank Division headquartered in Greenville, Ohio. A wholly-owned subsidiary of Park, GFSC is a consumer finance company located in Central Ohio.

Through February 16, 2012, Park operated a second banking subsidiary, Vision Bank ("Vision"), which was engaged in a general commercial banking business, primarily in Baldwin County, Alabama and the panhandle of Florida. Promptly following the sale of the Vision business to Centennial Bank (a wholly-owned subsidiary of HomeBanc Shares, Inc.), Vision surrendered its Florida banking charter to the Florida Office of Financial Regulation and became a non-bank Florida corporation. Vision (the Florida corporation) merged with and into a wholly-owned, non-bank subsidiary of Park, SEPH, with SEPH being the surviving entity. SEPH holds the remaining assets and liabilities retained by Vision subsequent to the sale. SEPH also holds OREO that had previously been transferred to SEPH from Vision. SEPH's assets consist primarily of performing and nonperforming loans and OREO. This segment represents a run off portfolio of the legacy Vision assets.

All of the Ohio-based banking divisions provide the following principal services: the acceptance of deposits for demand, savings and time accounts; commercial, industrial, consumer and real estate lending, including installment loans, credit cards, home equity lines of credit; trust services; cash management; safe deposit operations; electronic funds transfers and a variety of additional banking-related services. See Note 27 - Segment Information for financial information on the Corporation’s operating segments.

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Investment Securities

12 Months Ended

Dec. 31, 2016

Investments, Debt and Equity Securities [Abstract]

Investments Securities

Investment Securities

The amortized cost and fair value of investment securities are shown in the following tables. Management performs a quarterly evaluation of investment securities for any other-than-temporary impairment. During 2016, 2015 and 2014, there were no investment securities deemed to be other-than-temporarily impaired.

Investment securities at December 31, 2016 and December 31, 2015 were as follows:

(In thousands)	Amortized Cost		Gross Unrealized/Unrecognized Holding Gains		Gross Unrealized/Unrecognized Holding Losses		Estimated Fair Value
2016:
Securities Available-for-Sale
Obligations of U.S. Treasury and other U.S. Government sponsored entities	$	270,000	$	—	$	2,467	$	267,533
U.S. Government sponsored entities’ asset-backed securities	991,642		5,372		9,842		987,172
Other equity securities	1,119		2,315		—		3,434
Total	$	1,262,761	$	7,687	$	12,309	$	1,258,139
2016:
Securities Held-to-Maturity
Obligations of states and political subdivisions	$	188,622	$	977	$	5,148	$	184,451
U.S. Government sponsored entities’ asset-backed securities	71,211		1,097		87		72,221
Total	$	259,833	$	2,074	$	5,235	$	256,672

(In thousands)	Amortized Cost		Gross Unrealized/Unrecognized Holding Gains		Gross Unrealized/Unrecognized Holding Losses		Estimated Fair Value
2015:
Securities Available-for-Sale
Obligations of U.S. Treasury and other U.S. Government sponsored entities	$	527,605	$	—	$	5,542	$	522,063
U.S. Government sponsored entities’ asset-backed securities	907,989		8,776		5,272		911,493
Other equity securities	1,120		1,590		—		2,710
Total	$	1,436,714	$	10,366	$	10,814	$	1,436,266
2015:
Securities Held-to-Maturity
Obligations of states and political subdivisions	$	48,190	$	734	$	—	$	48,924
U.S. Government sponsored entities’ asset-backed securities	101,112		1,526		134		102,504
Total	$	149,302	$	2,260	$	134	$	151,428

Park’s U.S. Government sponsored entities' asset-backed securities consisted of 15-year mortgage-backed securities and collateralized mortgage obligations (CMOs). At December 31, 2016, the amortized cost of Park’s available-for-sale mortgage-backed securities was $545.1 million and there were no held-to-maturity mortgage-backed securities within Park's investment portfolio. At December 31, 2016, the amortized cost of Park's available-for-sale and held-to-maturity CMOs was $446.5 million and $71.2 million, respectively.

The following table provides detail on investment securities with unrealized losses aggregated by investment category and length of time the individual securities had been in a continuous loss position at December 31, 2016 and December 31, 2015:

	Less than 12 Months				12 Months or Longer				Total
(In thousands)	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
2016:
Securities Available-for-Sale
Obligations of U.S. Treasury and other U.S. Government sponsored entities	$	247,695	$	2,305	$	19,838	$	162	$	267,533	$	2,467
U.S. Government sponsored entities' asset-backed securities	612,321		9,473		27,325		369		639,646		9,842
Total	$	860,016	$	11,778	$	47,163	$	531	$	907,179	$	12,309
2016:
Securities Held-to-Maturity
Obligations of states and political subdivisions	$	134,909	$	5,148	$	—	$	—	$	134,909	$	5,148
U.S. Government sponsored entities’ asset-backed securities	—		—		7,564		87		7,564		87
Total	$	134,909	$	5,148	$	7,564	$	87	$	142,473	$	5,235

	Less than 12 Months				12 Months or Longer				Total
(In thousands)	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
2015:
Securities Available-for-Sale
Obligations of U.S. Treasury and other U.S. Government sponsored entities	$	326,973	$	2,117	$	195,090	$	3,425	$	522,063	$	5,542
U.S. Government sponsored entities' asset-backed securities	384,169		2,776		114,543		2,496		498,712		5,272
Total	$	711,142	$	4,893	$	309,633	$	5,921	$	1,020,775	$	10,814
2015:
Securities Held-to-Maturity
U.S. Government sponsored entities' asset-backed securities	$	5,656	$	10	$	7,792	$	124	$	13,448	$	134

Management does not believe any individual unrealized loss as of December 31, 2016 or 2015 represented an other-than-temporary impairment. The unrealized losses on debt securities are primarily the result of interest rate changes. These conditions will not prohibit Park from receiving its contractual principal and interest payments on these debt securities. The fair value of these debt securities is expected to recover as payments are received on these securities and they approach maturity. Should the impairment of any of these securities become other-than-temporary, the cost basis of the investment will be reduced and the resulting loss recognized in net income in the period the other-than-temporary impairment is identified.

Other investment securities (as shown on the Consolidated Balance Sheets) consist of stock investments in the FHLB, the FRB and other equities carried at cost. The FHLB and FRB restricted stock investments are carried at their redemption value. Park owned $50.1 million of FHLB stock and $8.2 million of FRB stock at both December 31, 2016 and December 31, 2015. Park owned $3.5 million of other equities carried at cost at December 31, 2016 and carried no other equities held at cost at December 31, 2015.

The amortized cost and estimated fair value of investments in debt securities at December 31, 2016, are shown in the following table by contractual maturity, except for asset-backed securities, which are shown as a single total, due to the unpredictability of the timing in principal repayments.

(In thousands)	Amortized Cost		Estimated Fair Value		Tax Equivalent Yield (1)
Securities Available-for-Sale
U.S. Treasury and other U.S. Government sponsored entities’ notes:
Due within one year	$	25,000	$	24,933	0.87	%
Due one through five years	245,000		242,600		1.22	%
Total	$	270,000	$	267,533	1.18	%
U.S. Government sponsored entities’ asset-backed securities	$	991,642	$	987,172	2.10	%
Securities Held-to-Maturity
Obligations of states and political subdivisions
Due greater than ten years	$	188,622	$	184,451	4.50	%
Total	$	188,622	$	184,451	4.50	%
U.S. Government sponsored entities’ asset-backed securities	$	71,211	$	72,221	3.31	%

 ⁽¹⁾ The tax equivalent yield for obligations of states and political subdivisions includes the effects of a taxable equivalent adjustment using a 35% rate. The taxable equivalent adjustment was $1.4 million for the year ended December 31, 2016.

All of Park’s securities shown in the above table as U.S. Treasury and other U.S. Government sponsored entities' notes are callable notes. These callable securities have a final maturity of 0.9 years to 3.5 years. The remaining weighted average life of the investment portfolio is 4.4 years.

At December 31, 2016, investment securities with an amortized cost of $343 million were pledged for government and trust department deposits, $569 million were pledged to secure repurchase agreements and $25 million were pledged as collateral for FHLB advance borrowings. At December 31, 2015, investment securities with an amortized cost of $429 million were pledged for government and trust department deposits, $622 million were pledged to secure repurchase agreements and $21 million were pledged as collateral for FHLB advance borrowings.

At December 31, 2016, there were no holdings of securities of any one issuer, other than the U.S. Government and its agencies, in an amount greater than 10% of shareholders’ equity.

During 2015, Park sold certain HTM investment securities with a book value of $3.1 million at a gain of $88,000. These securities had been paid down to 97.8% of the principal outstanding at acquisition. During 2014, Park sold certain AFS investment securities with a book value of $187,000 at a gain of $22,000. Additionally, Park sold certain AFS investment securities with a book value of $174.1 million at a loss of $1.2 million. No securities were sold during 2016.

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Loans

12 Months Ended

Dec. 31, 2016

Loans and Leases Receivable Disclosure [Abstract]

Loans

Loans

The composition of the loan portfolio, by class of loan, as of December 31, 2016 and December 31, 2015 was as follows:

	12/31/2016						12/31/2015
(In thousands)	Loan Balance		Accrued Interest Receivable		Recorded Investment		Loan Balance		Accrued Interest Receivable		Recorded Investment
Commercial, financial and agricultural *	$	994,619	$	3,558	$	998,177	$	955,727	$	3,437	$	959,164
Commercial real estate *	1,155,703		4,161		1,159,864		1,113,603		4,009		1,117,612
Construction real estate:
SEPH commercial land and development	—		—		—		2,044		—		2,044
Remaining commercial	135,343		398		135,741		128,046		321		128,367
Mortgage	48,699		106		48,805		36,722		75		36,797
Installment	4,903		17		4,920		6,533		21		6,554
Residential real estate:
Commercial	406,687		940		407,627		410,571		1,014		411,585
Mortgage	1,169,495		1,459		1,170,954		1,210,819		1,469		1,212,288
HELOC	212,441		853		213,294		211,415		769		212,184
Installment	19,874		67		19,941		22,638		78		22,716
Consumer	1,120,850		3,385		1,124,235		967,111		3,032		970,143
Leases	3,243		29		3,272		2,856		14		2,870
Total loans	$	5,271,857	$	14,973	$	5,286,830	$	5,068,085	$	14,239	$	5,082,324

* Included within commercial, financial and agricultural loans and commercial real estate loans is an immaterial amount of consumer loans that were not broken out by class.

Loans are shown net of deferred origination fees, costs and unearned income of $11.1 million at December 31, 2016 and $10.4 million at December 31, 2015, which represented a net deferred income position in both years.

Overdrawn deposit accounts of $2.9 million and $1.7 million had been reclassified to loans at December 31, 2016 and 2015, respectively, and are included in the commercial, financial and agricultural loan class above.

Credit Quality

The following table presents the recorded investment in nonaccrual loans, accruing troubled debt restructurings ("TDRs"), and loans past due 90 days or more and still accruing by class of loan as of December 31, 2016 and December 31, 2015:

	12/31/2016
(In thousands)	Nonaccrual Loans		Accruing Troubled Debt Restructurings		Loans Past Due 90 Days or More and Accruing		Total Nonperforming Loans
Commercial, financial and agricultural	$	20,057	$	600	$	15	$	20,672
Commercial real estate	19,169		5,305		—		24,474
Construction real estate:
SEPH commercial land and development	—		—		—		—
Remaining commercial	1,833		393		—		2,226
Mortgage	—		104		—		104
Installment	61		95		12		168
Residential real estate:
Commercial	23,013		89		—		23,102
Mortgage	18,313		9,612		887		28,812
HELOC	1,783		673		25		2,481
Installment	644		609		60		1,313
Consumer	2,949		748		1,139		4,836
Total loans	$	87,822	$	18,228	$	2,138	$	108,188

	12/31/2015
(In thousands)	Nonaccrual Loans		Accruing Troubled Debt Restructurings		Loans Past Due 90 Days or More and Accruing		Total Nonperforming Loans
Commercial, financial and agricultural	$	21,676	$	8,947	$	—	$	30,623
Commercial real estate	15,268		2,757		—		18,025
Construction real estate:
SEPH commercial land and development	2,044		—		—		2,044
Remaining commercial	4,162		514		—		4,676
Mortgage	7		110		—		117
Installment	64		114		—		178
Residential real estate:
Commercial	25,063		261		—		25,324
Mortgage	20,378		10,143		851		31,372
HELOC	1,749		873		27		2,649
Installment	1,657		635		4		2,296
Consumer	3,819		734		1,093		5,646
Total loans	$	95,887	$	25,088	$	1,975	$	122,950

The following table provides additional information regarding those nonaccrual and accruing TDR loans that are individually evaluated for impairment and those collectively evaluated for impairment as of December 31, 2016 and December 31, 2015.

	12/31/2016						12/31/2015
(In thousands)	Nonaccrual and accruing TDRs		Loans individually evaluated for impairment		Loans collectively evaluated for impairment		Nonaccrual and accruing TDRs		Loans individually evaluated for impairment		Loans collectively evaluated for impairment
Commercial, financial and agricultural	$	20,657	$	20,624	$	33	$	30,623	$	30,595	$	28
Commercial real estate	24,474		24,474		—		18,025		18,025		—
Construction real estate:
SEPH commercial land and development	—		—		—		2,044		2,044		—
Remaining commercial	2,226		2,226		—		4,676		4,676		—
Mortgage	104		—		104		117		—		117
Installment	156		—		156		178		—		178
Residential real estate:
Commercial	23,102		23,102		—		25,324		25,324		—
Mortgage	27,925		—		27,925		30,521		—		30,521
HELOC	2,456		—		2,456		2,622		—		2,622
Installment	1,253		—		1,253		2,292		—		2,292
Consumer	3,697		—		3,697		4,553		—		4,553
Total loans	$	106,050	$	70,426	$	35,624	$	120,975	$	80,664	$	40,311

All of the loans individually evaluated for impairment were evaluated using the fair value of the collateral or the present value of expected future cash flows as the measurement method.

The following table presents loans individually evaluated for impairment by class of loan as of December 31, 2016 and December 31, 2015.

	12/31/2016						12/31/2015
(In thousands)	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	$	41,075	$	19,965	$	—	$	32,583	$	18,763	$	—
Commercial real estate	23,961		23,474		—		15,138		14,916		—
Construction real estate:
SEPH commercial land and development	—		—		—		10,834		2,044		—
Remaining commercial	3,662		2,226		—		2,506		1,531		—
Residential real estate:
Commercial	24,409		22,687		—		23,798		23,480		—
With an allowance recorded
Commercial, financial and agricultural	810		659		152		16,155		11,832		1,904
Commercial real estate	1,014		1,000		309		3,195		3,109		381
Construction real estate:
Remaining commercial	—		—		—		3,145		3,145		1,356
Residential real estate:
Commercial	427		415		87		1,951		1,844		550
Total	$	95,358	$	70,426	$	548	$	109,305	$	80,664	$	4,191

Management’s general practice is to proactively charge down loans individually evaluated for impairment to the fair value of the underlying collateral. At December 31, 2016 and December 31, 2015, there were $24.7 million and $24.2 million, respectively, of partial charge-offs on loans individually evaluated for impairment with no related allowance recorded and $177,000 and $4.5 million, respectively, of partial charge-offs on loans individually evaluated for impairment that also had a specific reserve allocated.

The allowance for loan losses included specific reserves related to loans individually evaluated for impairment at December 31, 2016 and 2015, of $0.5 million and $4.2 million, respectively. These loans with specific reserves had a recorded investment of $2.1 million and $19.9 million as of December 31, 2016 and 2015, respectively.

Interest income on nonaccrual loans individually evaluated for impairment is recognized on a cash basis only when Park expects to receive the entire recorded investment of the loan. Interest income on accruing TDRs individually evaluated for impairment continues to be recorded on an accrual basis. The following tables present the average recorded investment and interest income recognized during the year subsequent to impairment on loans individually evaluated for impairment as of and for the years ended December 31, 2016, 2015, and 2014:

			Year ended December 31, 2016
(In thousands)	Recorded Investment as of December 31, 2016		Average recorded investment		Interest income recognized
Commercial, financial and agricultural	$	20,624	$	26,821	$	885
Commercial real estate	24,474		22,828		884
Construction real estate:
SEPH commercial land and development	—		1,597		—
Remaining commercial	2,226		3,906		66
Residential real estate:
Commercial	23,102		24,341		2,942
Consumer	—		3		—
Total	$	70,426	$	79,496	$	4,777

			Year ended December 31, 2015
(In thousands)	Recorded Investment as of December 31, 2015		Average recorded investment		Interest income recognized
Commercial, financial and agricultural	$	30,595	$	20,179	$	340
Commercial real estate	18,025		17,883		550
Construction real estate:
SEPH commercial land and development	2,044		2,066		21
Remaining commercial	4,676		5,666		26
Residential real estate:
Commercial	25,324		24,968		1,026
Consumer	—		—		—
Total	$	80,664	$	70,762	$	1,963

			Year ended December 31, 2014
(In thousands)	Recorded Investment as of December 31, 2014		Average recorded investment		Interest income recognized
Commercial, financial and agricultural	$	19,106	$	19,518	$	360
Commercial real estate	21,989		31,945		1,027
Construction real estate:
SEPH commercial land and development	2,078		3,658		146
Remaining commercial	5,609		8,784		61
Residential real estate:
Commercial	24,930		28,306		1,084
Consumer	—		403		—
Total	$	73,712	$	92,614	$	2,678

The following tables present the aging of the recorded investment in past due loans as of December 31, 2016 and December 31, 2015 by class of loan.

	12/31/2016
(In thousands)	Accruing loans past due 30-89 days		Past due, nonaccrual loans and loans past due 90 days or more and accruing (1)		Total past due		Total current (2)		Total recorded investment
Commercial, financial and agricultural	$	371	$	4,113	$	4,484	$	993,693	$	998,177
Commercial real estate	355		2,499		2,854		1,157,010		1,159,864
Construction real estate:
SEPH commercial land and development	—		—		—		—		—
Remaining commercial	—		541		541		135,200		135,741
Mortgage	559		—		559		48,246		48,805
Installment	223		64		287		4,633		4,920
Residential real estate:
Commercial	330		3,631		3,961		403,666		407,627
Mortgage	10,854		9,769		20,623		1,150,331		1,170,954
HELOC	970		1,020		1,990		211,304		213,294
Installment	350		319		669		19,272		19,941
Consumer	12,579		2,094		14,673		1,109,562		1,124,235
Leases	—		—		—		3,272		3,272
Total loans	$	26,591	$	24,050	$	50,641	$	5,236,189	$	5,286,830

(1) Includes an aggregate of $2.1 million of loans past due 90 days or more and accruing. The remaining are past due, nonaccrual loans.

(2) Includes an aggregate of $65.9 million of nonaccrual loans which are current in regards to contractual principal and interest payments.

	12/31/2015
(In thousands)	Accruing loans past due 30-89 days		Past due, nonaccrual loans and loans past due 90 days or more and accruing (1)		Total past due		Total current (2)		Total recorded investment
Commercial, financial and agricultural	$	670	$	7,536	$	8,206	$	950,958	$	959,164
Commercial real estate	142		530		672		1,116,940		1,117,612
Construction real estate:
SEPH commercial land and development	—		2,044		2,044		—		2,044
Remaining commercial	165		84		249		128,118		128,367
Mortgage	63		7		70		36,727		36,797
Installment	200		46		246		6,308		6,554
Residential real estate:
Commercial	325		19,521		19,846		391,739		411,585
Mortgage	10,569		8,735		19,304		1,192,984		1,212,288
HELOC	487		186		673		211,511		212,184
Installment	426		318		744		21,972		22,716
Consumer	11,458		3,376		14,834		955,309		970,143
Leases	—		—		—		2,870		2,870
Total loans	$	24,505	$	42,383	$	66,888	$	5,015,436	$	5,082,324

(1) Includes an aggregate of $2.0 million of loans past due 90 days or more and accruing. The remaining are past due, nonaccrual loans.

(2) Includes an aggregate of $55.5 million of nonaccrual loans which are current in regards to contractual principal and interest payments.

Credit Quality Indicators

Management utilizes past due information as a credit quality indicator across the loan portfolio. Past due information as of December 31, 2016 and 2015 is included in the tables above. The past due information is the primary credit quality indicator within the following classes of loans: (1) mortgage loans and installment loans in the construction real estate segment; (2) mortgage loans, HELOC and installment loans in the residential real estate segment; and (3) consumer loans. The primary credit indicator for commercial loans is based on an internal grading system that grades all commercial loans on a scale from 1 to 8. Credit grades are continuously monitored by the responsible loan officer and adjustments are made when appropriate. A grade of 1 indicates little or no credit risk and a grade of 8 is considered a loss. Commercial loans that are pass-rated (graded a 1 through a 4) are considered to be of acceptable credit risk. Commercial loans graded a 5 (special mention) are considered to be watch list credits and a higher loan loss reserve percentage is allocated to these loans. Loans classified as special mention have potential weaknesses that require management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or of Park’s credit position at some future date. Commercial loans graded a 6 (substandard), also considered watch list credits, are considered to represent higher credit risk and, as a result, a higher loan loss reserve percentage is allocated to these loans. Loans classified as substandard are inadequately protected by the current sound worth and paying capacity of the obligor or the value 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 Park will sustain some loss if the deficiencies are not corrected. Commercial loans graded a 7 (doubtful) are shown as nonaccrual and Park generally charges these loans down to their fair value by taking a partial charge-off or recording a specific reserve. Loans classified as doubtful have all the weaknesses inherent in those classified as substandard with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions, and values, highly questionable and improbable. Certain 6-rated loans and all 7-rated loans are placed on nonaccrual status and included within the impaired category. A loan is deemed impaired when management determines the borrower's ability to perform in accordance with the contractual loan agreement is in doubt. Any commercial loan graded an 8 (loss) is completely charged off.

The tables below present the recorded investment by loan grade at December 31, 2016 and December 31, 2015 for all commercial loans:

	12/31/2016
(In thousands)	5 Rated		6 Rated		Impaired		Pass Rated		Recorded Investment
Commercial, financial and agricultural*	$	5,826	$	—	$	20,657	$	971,694	$	998,177
Commercial real estate*	7,548		190		24,474		1,127,652		1,159,864
Construction real estate:
SEPH commercial land and development	—		—		—		—		—
Remaining commercial	287		118		2,226		133,110		135,741
Residential real estate:
Commercial	1,055		124		23,102		383,346		407,627
Leases	—		—		—		3,272		3,272
Total Commercial Loans	$	14,716	$	432	$	70,459	$	2,619,074	$	2,704,681

* Included within commercial, financial and agricultural loans and commercial real estate loans is an immaterial amount of consumer loans that were not broken out by class.

	12/31/2015
(In thousands)	5 Rated		6 Rated		Impaired		Pass Rated		Recorded Investment
Commercial, financial and agricultural*	$	4,392	$	347	$	30,623	$	923,802	$	959,164
Commercial real estate*	14,880		3,417		18,025		1,081,290		1,117,612
Construction real estate:
SEPH commercial land and development	—		—		2,044		—		2,044
Remaining commercial	2,151		122		4,676		121,418		128,367
Residential real estate:
Commercial	3,280		386		25,324		382,595		411,585
Leases	—		—		—		2,870		2,870
Total Commercial Loans	$	24,703	$	4,272	$	80,692	$	2,511,975	$	2,621,642

* Included within commercial, financial and agricultural loans and commercial real estate loans is an immaterial amount of consumer loans that were not broken out by class.

Troubled Debt Restructuring

Management classifies loans as TDRs when a borrower is experiencing financial difficulties and Park has granted a concession to the borrower as part of a modification or in the loan renewal process. In order to determine whether a borrower is experiencing financial difficulty, an evaluation is performed of the probability that the borrower will be in payment default on any of the borrower's debt in the foreseeable future without the modification. This evaluation is performed in accordance with the Company’s internal underwriting policy. Management’s policy is to modify loans by extending the term or by granting a temporary or permanent contractual interest rate below the market rate, not by forgiving debt. A court's discharge of a borrower's debt in a Chapter 7 bankruptcy is considered a concession when the borrower does not reaffirm the discharged debt.

Certain loans which were modified during the years ended December 31, 2016 and December 31, 2015 did not meet the definition of a TDR as the modification was a delay in a payment that was considered to be insignificant. Management considers a forbearance period of up to three months or a delay in payment of up to 30 days to be insignificant. TDRs may be classified as accruing if the borrower has been current for a period of at least six months with respect to loan payments and management expects that the borrower will be able to continue to make payments in accordance with the terms of the restructured note. Management reviews all accruing TDRs quarterly to ensure payments continue to be made in accordance with the modified terms.

Management reviews renewals/modifications of loans previously identified as TDRs to consider if it is appropriate to remove the TDR classification. If the borrower is no longer experiencing financial difficulty and the renewal/modification does not contain a concessionary interest rate or other concessionary terms, management considers the potential removal of the TDR classification. If deemed appropriate, the TDR classification is removed as the borrower has complied with the terms of the loan at the date of the renewal/modification and there was a reasonable expectation that the borrower would continue to comply with the terms of the loan subsequent to the date of the renewal/modification. The majority of these TDRs were originally considered restructurings in a prior year as a result of a renewal/modification with an interest rate that was not commensurate with the risk of the underlying loan at the time of the renewal/modification. During the years ended December 31, 2016 and 2015, Park removed the TDR classification on $2.7 million and $1.2 million, respectively, of loans that met the requirements discussed above.

At December 31, 2016 and 2015, there were $46.9 million and $41.1 million, respectively, of TDRs included in the nonaccrual loan totals. At December 31, 2016 and 2015, $38.0 million and $19.1 million, respectively, of these nonaccrual TDRs were performing in accordance with the terms of the restructured note. As of December 31, 2016 and 2015, loans with a recorded investment of $18.2 million and $25.1 million, respectively, were included in accruing TDR loan totals. Management will continue to review the restructured loans and may determine it appropriate to move certain nonaccrual TDRs to accrual status in the future.

At December 31, 2016 and 2015, Park had commitments to lend $0.7 million and $2.3 million, respectively, of additional funds to borrowers whose outstanding loan terms had been modified in a TDR.

The specific reserve related to TDRs at December 31, 2016 and 2015 was $0.2 million and $2.3 million, respectively. Modifications made in 2015 and 2016 were largely the result of renewals and extending the maturity date of the loan, at terms consistent with the original note. These modifications were deemed to be TDRs primarily due to Park’s conclusion that the borrower would likely not have qualified for similar terms through another lender. Many of the modifications deemed to be TDRs were previously identified as impaired loans, and thus were also previously evaluated for impairment under ASC 310.  Additional specific reserves of $1.0 million were recorded during the year ended December 31, 2016, as a result of TDRs identified in the 2016 year. Additional specific reserves of $1.3 million were recorded during the year ended December 31, 2015 as a result of TDRs identified in the 2015 year. Additional specific reserves of $0.7 million were recorded during the year ended December 31, 2014 as a result of TDRs identified in the 2014 year.

The terms of certain other loans were modified during the years ended December 31, 2016 and 2015 that did not meet the definition of a TDR. Modified substandard commercial loans which did not meet the definition of a TDR had a total recorded investment as of December 31, 2016 and 2015 of $26,000 and $116,000, respectively. The renewal/modification of these loans: (1) resulted in a delay in a payment that was considered to be insignificant, or (2) resulted in Park obtaining additional collateral or guarantees that improved the likelihood of the ultimate collection of the loan such that the modification was deemed to be at market terms.  Modified consumer loans which did not meet the definition of a TDR had a total recorded investment as of December 31, 2016 and 2015 of $7.4 million and $16.5 million, respectively. Many of these loans were to borrowers who were not experiencing financial difficulties but who were looking to reduce their cost of funds.

The following tables detail the number of contracts modified as TDRs during the years ended December 31, 2016, 2015 and 2014 as well as the recorded investment of these contracts at December 31, 2016, 2015, and 2014. The recorded investment pre- and post-modification is generally the same due to the fact that Park does not typically forgive principal.

	Year ended December 31, 2016
(In thousands)	Number of Contracts	Accruing		Nonaccrual		Recorded Investment
Commercial, financial and agricultural	32	$	191	$	8,450	$	8,641
Commercial real estate	14	3,844		2,537		6,381
Construction real estate:
SEPH commercial land and development	—	—		—		—
Remaining commercial	2	—		1,143		1,143
Mortgage	—	—		—		—
Installment	1	—		—		—
Residential real estate:
Commercial	11	89		1,033		1,122
Mortgage	34	114		2,292		2,406
HELOC	13	104		178		282
Installment	5	102		3		105
Consumer	293	184		994		1,178
Total loans	405	$	4,628	$	16,630	$	21,258

	Year ended December 31, 2015
(In thousands)	Number of Contracts	Accruing		Nonaccrual		Recorded Investment
Commercial, financial and agricultural	39	$	8,948	$	3,640	$	12,588
Commercial real estate	14	637		3,523		4,160
Construction real estate:
SEPH commercial land and development	—	—		—		—
Remaining commercial	2	513		—		513
Mortgage	1	19		—		19
Installment	—	—		—		—
Residential real estate:
Commercial	11	—		1,185		1,185
Mortgage	39	1,132		2,122		3,254
HELOC	26	315		45		360
Installment	9	—		155		155
Consumer	283	202		888		1,090
Total loans	424	$	11,766	$	11,558	$	23,324

	Year ended December 31, 2014
(In thousands)	Number of Contracts	Accruing		Nonaccrual		Recorded Investment
Commercial, financial and agricultural	30	$	292	$	431	$	723
Commercial real estate	11	1,184		1,254		2,438
Construction real estate:
SEPH commercial land and development	—	—		—		—
Remaining commercial	2	—		206		206
Mortgage	—	—		—		—
Installment	2	—		56		56
Residential real estate:
Commercial	9	—		866		866
Mortgage	46	32		2,325		2,357
HELOC	10	85		241		326
Installment	10	109		12		121
Consumer	330	244		1,058		1,302
Total loans	450	$	1,946	$	6,449	$	8,395

Of those loans which were modified and determined to be a TDR during the year ended December 31, 2016, $9.4 million were on nonaccrual status as of December 31, 2015. Of those loans which were modified and determined to be a TDR during the year ended December 31, 2015, $0.8 million were on nonaccrual status as of December 31, 2014. Of those loans which were modified and determined to be a TDR during the year ended December 31, 2014, $0.7 million were on nonaccrual status as of December 31, 2013.

The following table presents the recorded investment in financing receivables which were modified as TDRs within the previous 12 months and for which there was a payment default during the year ended December 31, 2016, December 31, 2015, and December 31, 2014. For this table, a loan is considered to be in default when it becomes 30 days contractually past due under the modified terms. The additional allowance for loan loss resulting from the defaults on TDR loans was immaterial.

	Year ended December 31, 2016			Year ended December 31, 2015				Year ended December 31, 2014
(In thousands)	Number of Contracts	Recorded Investment		Number of Contracts		Recorded Investment		Number of Contracts	Recorded Investment
Commercial, financial and agricultural	7	$	419	1		$	1	4	$	206
Commercial real estate	5	843		1		626		1	302
Construction real estate:
SEPH commercial land and development	—	—		—		—		—	—
Remaining commercial	—	—		—		—		—	—
Mortgage	—	—		—		—		—	—
Installment	—	—		—		—		—	—
Residential real estate:
Commercial	7	848		3		1,005		1	3
Mortgage	15	1,201		12		682		14	810
HELOC	—	—		1		5		2	160
Installment	1	3		2		101		2	12
Consumer	62	484		47		434		62	516
Leases	—	—		—		—		—	—
Total loans	97	$	3,798	$	67	$	2,854	86	$	2,009

Of the $3.8 million in modified TDRs which defaulted during the year ended December 31, 2016, $111,000 were accruing loans and $3.7 million were nonaccrual loans. Of the $2.9 million in modified TDRs which defaulted during the year ended December 31, 2015, $44,000 were accruing loans and $2.8 million were nonaccrual loans. Of the $2.0 million in modified TDRs which defaulted during the year ended December 31, 2014, $314,000 were accruing loans and $1.7 million were nonaccrual loans.

Certain of the Corporation’s executive officers, directors and related entities of directors are loan customers of PNB. As of December 31, 2016 and 2015, credit exposure aggregating approximately $43.4 million and $47.0 million, respectively, was outstanding to such parties. Of this total exposure, approximately $29.6 million and $36.0 million was outstanding at December 31, 2016 and 2015, respectively, with the remaining balance representing available credit. During 2016, new loans and advances on existing loans were made to these executive officers, directors and related entities of directors totaling $5.4 million and $3.5 million, respectively. These extensions of credit were offset by principal payments of $15.3 million. During 2015, new loans and advances on existing loans were $5.8 million and $7.1 million, respectively. These extensions of credit were offset by principal payments of $12.9 million.

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Allowance for Loan Losses

12 Months Ended

Dec. 31, 2016

Allowance For Loan Losses [Abstract]

Allowance for Loan Losses

Allowance for Loan Losses

The allowance for loan losses is that amount management believes is adequate to absorb probable incurred credit losses in the loan portfolio based on management’s evaluation of various factors including the overall growth in the loan portfolio, an analysis of individual loans, prior and current loss experience, and current economic conditions. A provision for loan losses is charged to operations based on management’s periodic evaluation of these and other pertinent factors as discussed within Note 1 - Summary of Significant Accounting Policies.

Loss factors are reviewed quarterly and updated at least annually to reflect recent loan loss history and incorporate current risk and trends which may not be recognized in historical data. Several enhancements were made in the third quarter of 2016 as a result of management's quarterly review.

• Management updated the historical loss calculation during the third quarter of 2016, incorporating annualized net charge-offs plus changes in specific reserves through September 30, 2016. Additionally, management removed from the historical loss calculation net charge-offs plus changes in specific reserves for the year ended December 31, 2009. Management's belief has been that historical losses should encompass the complete economic cycle. However, given the extended length of the economic recovery, management determined that 2009 loss data was no longer reflective of the current portfolio. Management has taken the look-back period into consideration in the quarterly evaluation of environmental loss factors.

As part of the 2016 mid-year historical loss update, management determined that it was no longer appropriate to more heavily weight those years with higher losses in the historical loss calculation and applied equal percentages to each of the years in this calculation. The trends that existed resulting in management applying different weightings to years within the historical loss calculation no longer appeared to exist, resulting in the adjustment back to equal weightings.

• As part of the normal quarterly process, management reviewed and updated the environmental loss factors applied to the commercial portfolio in order to incorporate changes in the macroeconomic environment. Additionally, management updated the calculation of the loss emergence period utilizing a more granular process.

The impact of the changes described above resulted in a decrease of $3.8 million in the ALLL at September 30, 2016, compared to what the ALLL would have been had the calculation, and related assumptions, used at June 30, 2016 remained constant.

The loss factors were updated in the fourth quarter of 2016 to incorporate losses through December 31, 2016.

The activity in the allowance for loan losses for the years ended December 31, 2016, 2015, and 2014 is summarized in the following tables.

	Year ended December 31, 2016
(In thousands)	Commercial, financial and agricultural			Commercial real estate			Construction real estate			Residential real estate			Consumer			Leases			Total
Allowance for credit losses:
Beginning balance	$	13,694		$	9,197		$	8,564		$	13,514		$	11,524		$	1		$	56,494
Charge-offs	5,786			412			1,436			3,014			10,151			—			20,799
Recoveries	(1,259		)	(3,671		)	(8,559		)	(2,446		)	(4,094		)	(1		)	(20,030		)
Net charge-offs (recoveries)	4,527			(3,259		)	(7,123		)	568			6,057			(1		)	769
Provision (Recovery)	4,267			(2,024		)	(10,440		)	(1,988		)	5,086			(2		)	(5,101		)
Ending balance	$	13,434		$	10,432		$	5,247		$	10,958		$	10,553		—			$	50,624

	Year ended December 31, 2015
(In thousands)	Commercial, financial and agricultural			Commercial real estate			Construction real estate			Residential real estate			Consumer			Leases			Total
Allowance for credit losses:
Beginning balance	$	10,719		$	8,808		$	8,652		$	14,772		$	11,401		$	—		$	54,352
Charge-offs	2,478			348			470			2,352			8,642			—			14,290
Recoveries	(1,373		)	(2,241		)	(2,092		)	(2,438		)	(3,295		)	(3		)	(11,442		)
Net charge-offs (recoveries)	1,105			(1,893		)	(1,622		)	(86		)	5,347			(3		)	2,848
Provision (Recovery)	4,080			(1,504		)	(1,710		)	(1,344		)	5,470			(2		)	4,990
Ending balance	$	13,694		$	9,197		$	8,564		$	13,514		$	11,524		$	1		$	56,494

	Year ended December 31, 2014
(In thousands)	Commercial, financial and agricultural			Commercial real estate			Construction real estate			Residential real estate			Consumer			Leases			Total
Allowance for credit losses:
Beginning balance	$	14,218		$	15,899		$	6,855		$	14,251		$	8,245		$	—		$	59,468
Charge-offs	3,779			8,003			1,316			3,944			7,738			—			24,780
Recoveries	(1,003		)	(7,759		)	(12,572		)	(2,985		)	(2,671		)	(7		)	(26,997		)
Net charge-offs (recoveries)	2,776			244			(11,256		)	959			5,067			(7		)	(2,217		)
(Recovery) Provision	(723		)	(6,847		)	(9,459		)	1,480			8,223			(7		)	(7,333		)
Ending balance	$	10,719		$	8,808		$	8,652		$	14,772		$	11,401		$	—		$	54,352

Loans collectively evaluated for impairment in the following tables include all performing loans at December 31, 2016 and 2015, as well as nonperforming loans internally classified as consumer loans. Nonperforming consumer loans are not typically individually evaluated for impairment, but receive a portion of the statistical allocation of the allowance for loan losses. Loans individually evaluated for impairment include all impaired loans internally classified as commercial loans at December 31, 2016 and 2015, which are evaluated for impairment in accordance with GAAP (see Note 1 - Summary of Significant Accounting Policies).

The composition of the allowance for loan losses at December 31, 2016 and 2015 was as follows: 

	December 31, 2016
(In thousands)	Commercial, financial, and agricultural			Commercial real estate			Construction real estate			Residential real estate			Consumer			Leases			Total
Allowance for loan losses:
Ending allowance balance attributed to loans
Individually evaluated for impairment	$	152		$	309		$	—		$	87		$	—		$	—		$	548
Collectively evaluated for impairment	13,282			10,123			5,247			10,871			10,553			—			50,076
Total ending allowance balance	$	13,434		$	10,432		$	5,247		$	10,958		$	10,553		$	—		$	50,624
Loan Balance:
Loans individually evaluated for impairment	$	20,622		$	24,465		$	2,226		$	23,102		$	—		$	—		$	70,415
Loans collectively evaluated for impairment	973,997			1,131,238			186,719			1,785,395			1,120,850			3,243			5,201,442
Total ending loan balance	$	994,619		$	1,155,703		$	188,945		$	1,808,497		$	1,120,850		$	3,243		$	5,271,857
Allowance for loan losses as a percentage of loan balance:
Loans individually evaluated for impairment	0.74		%	1.26		%	—		%	0.38		%	—		%	—		%	0.78		%
Loans collectively evaluated for impairment	1.36		%	0.89		%	2.81		%	0.61		%	0.94		%	—		%	0.96		%
Total	1.35		%	0.90		%	2.78		%	0.61		%	0.94		%	—		%	0.96		%
Recorded Investment:
Loans individually evaluated for impairment	$	20,624		$	24,474		$	2,226		$	23,102		$	—		$	—		$	70,426
Loans collectively evaluated for impairment	977,553			1,135,390			187,240			1,788,714			1,124,235			3,272			5,216,404
Total ending recorded investment	$	998,177		$	1,159,864		$	189,466		$	1,811,816		$	1,124,235		$	3,272		$	5,286,830

	December 31, 2015
(In thousands)	Commercial, financial, and agricultural			Commercial real estate			Construction real estate			Residential real estate			Consumer			Leases			Total
Allowance for loan losses:
Ending allowance balance attributed to loans
Individually evaluated for impairment	$	1,904		$	381		$	1,356		$	550		$	—		$	—		$	4,191
Collectively evaluated for impairment	11,790			8,816			7,208			12,964			11,524			1			52,303
Total ending allowance balance	$	13,694		$	9,197		$	8,564		$	13,514		$	11,524		$	1		$	56,494
Loan Balance:
Loans individually evaluated for impairment	$	30,545		$	18,015		$	6,716		$	25,323		$	—		$	—		$	80,599
Loans collectively evaluated for impairment	925,182			1,095,588			166,629			1,830,120			967,111			2,856			4,987,486
Total ending loan balance	$	955,727		$	1,113,603		$	173,345		$	1,855,443		$	967,111		$	2,856		$	5,068,085
Allowance for loan losses as a percentage of loan balance:
Loans individually evaluated for impairment	6.23		%	2.11		%	20.19		%	2.17		%	—		%	—		%	5.20		%
Loans collectively evaluated for impairment	1.27		%	0.80		%	4.33		%	0.71		%	1.19		%	0.04		%	1.05		%
Total	1.43		%	0.83		%	4.94		%	0.73		%	1.19		%	0.04		%	1.11		%
Recorded Investment:
Loans individually evaluated for impairment	$	30,595		$	18,025		$	6,720		$	25,324		$	—		$	—		$	80,664
Loans collectively evaluated for impairment	928,569			1,099,587			167,042			1,833,449			970,143			2,870			5,001,660
Total ending recorded investment	$	959,164		$	1,117,612		$	173,762		$	1,858,773		$	970,143		$	2,870		$	5,082,324

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Loans Held for Sale (Notes)

12 Months Ended

Dec. 31, 2016

Loans Held for Sale [Abstract]

Loans Held for Sale [Table Text Block]

Loans Held for Sale

Mortgage loans held for sale are carried at their fair value. Mortgage loans held for sale were $10.4 million and $7.3 million at December 31, 2016 and 2015, respectively. These amounts are included in loans on the Consolidated Balance Sheets and in the residential real estate loan segments in Note 5 - Loans and Note 6 - Allowance for Loan Losses. The contractual balance was $10.3 million and $7.2 million at December 31, 2016 and 2015, respectively. The gain expected upon sale was $131,000 and $95,000 at December 31, 2016 and 2015, respectively. None of these loans were 90 days or more past due or on nonaccrual status as of December 31, 2016 or 2015.

During 2015, Park transferred to held for sale and sold certain commercial loans previously held for investment with a book balance of $144,000, and recognized a gain of $756,000. During 2014, Park transferred certain commercial loans held for investment, with a book balance of $22.0 million, to the loans held for sale portfolio, and subsequently completed the sale of these commercial loans held for sale, recognizing a net gain on sale of $1.9 million. No commercial loans were held for sale or sold during 2016.

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Other Real Estate Owned (Notes)

12 Months Ended

Dec. 31, 2016

Schedule of Assets Repossessed or Foreclosed, or loans in process of foreclosure [Line Items]

Real Estate Owned [Text Block]

Other Real Estate Owned

The carrying amount of foreclosed properties held at December 31, 2016 and December 31, 2015 are listed below, as well as the recorded investment of loans secured by residential real estate properties for which formal foreclosure proceedings were in process at those dates.

(In thousands)	December 31, 2016		December 31, 2015
OREO:
Commercial real estate	$	7,642	$	8,333
Construction real estate	4,624		7,259
Residential real estate	1,660		3,059
Total OREO	$	13,926	$	18,651
Loans in process of foreclosure:
Residential real estate	$	3,250	$	2,021

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Premises And Equipment

12 Months Ended

Dec. 31, 2016

Property, Plant and Equipment [Abstract]

Premises and Equipment

Premises and Equipment

The major categories of premises and equipment and accumulated depreciation are summarized as follows:

December 31 (In thousands)	2016			2015
Land	$	19,577		$	19,123
Buildings	75,472			74,525
Equipment, furniture and fixtures	52,719			47,839
Leasehold improvements	3,400			3,878
Total	$	151,168		$	145,365
Less accumulated depreciation	(93,197		)	(85,872		)
Premises and equipment, net	$	57,971		$	59,493

Depreciation expense amounted to $8.4 million, $7.3 million and $7.2 million for the years ended December 31, 2016, 2015 and 2014, respectively.

The Corporation leases certain premises and equipment accounted for as operating leases. The following is a schedule of the future minimum rental payments required for the next five years under such leases with initial terms in excess of one year: 

(In thousands)
2017	$	1,508
2018	1,269
2019	1,178
2020	621
2021	422
Thereafter	700
Total	$	5,698

Rent expense for Park was $2.1 million, $1.7 million and $1.7 million, for the years ended December 31, 2016, 2015 and 2014, respectively.

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Investment in Qualified Affordable Housing

12 Months Ended

Dec. 31, 2016

Investments in Qualified Affordable Housing [Abstract]

Equity Method Investments and Joint Ventures Disclosure [Text Block]

Investment in Qualified Affordable Housing

Park makes certain equity investments in various limited partnerships that sponsor affordable housing projects. The purposes of these investments are to achieve a satisfactory return on capital, help create affordable housing opportunities, and assist the Company to achieve our goals associated with the Community Reinvestment Act.

As permitted by ASU 2014-01, Accounting for Investments in Qualified Affordable Housing Projects, Park elected the proportional amortization method of accounting. Under the proportional amortization method, amortization expense and tax benefits are recognized through the provision for income taxes.

The table below details the balances of Park’s affordable housing tax credit investments and related unfunded commitments as of December 31, 2016 and 2015.

(In thousands)	December 31, 2016		December 31, 2015
Affordable housing tax credit investments	$	52,947	$	51,247
Unfunded commitments	14,282		20,311

Commitments are funded when capital calls are made by the general partner. Park expects that the current commitment will be funded between 2017 and 2027.

During the years ended December 31, 2016, 2015 and 2014, Park recognized amortization expense of $7.3 million, $6.7 million and $6.9 million, respectively, which was included within the provision for income taxes. For the years ended December 31, 2016, 2015 and 2014, Park recognized tax credits and other benefits from its affordable housing tax credit investments of $9.4 million, $8.9 million and $8.8 million, respectively.

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Deposits

12 Months Ended

Dec. 31, 2016

Deposits [Abstract]

Deposits

Deposits

At December 31, 2016 and 2015, non-interest bearing and interest bearing deposits were as follows:

December 31 (In thousands)	2016		2015
Non-interest bearing	$	1,523,417	$	1,404,032
Interest bearing	3,998,539		3,943,610
Total	$	5,521,956	$	5,347,642

At December 31, 2016, the maturities of time deposits were as follows: 

(In thousands)
2017	$	717,879
2018	131,236
2019	153,257
2020	63,758
2021	51,245
After 5 years	495
Total	$	1,117,870

At December 31, 2016 and 2015, respectively, Park had approximately $26.5 million and $21.6 million of deposits received from executive officers, directors and related entities of directors.

Time deposits that exceed the FDIC Insurance limit of $250,000 at December 31, 2016 and 2015 were $43.3 million and $49.7 million, respectively.

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Repurchase Agreements (Notes)

12 Months Ended

Dec. 31, 2016

Transfer of Certain Financial Assets Accounted for as Secured Borrowings [Line Items]

Transfer of Certain Financial Assets Accounted for as Secured Borrowings [Table Text Block]

Repurchase Agreement Borrowings

Securities sold under agreements to repurchase ("repurchase agreements") with customers represent funds deposited by customers, generally on an overnight basis, that are collateralized by investment securities owned by Park. Repurchase agreements with customers are included in short-term borrowings on the Consolidated Balance Sheets. Park's repurchase agreements with a third-party financial institution are classified as long-term debt on the Consolidated Balance Sheets.

All repurchase agreements are subject to terms and conditions of repurchase/security agreements between Park and the client and are accounted for as secured borrowings. Park's repurchase agreements reflected in short-term borrowings consist of customer accounts and securities which are pledged on an individual security basis.

At December 31, 2016 and December 31, 2015, Park's repurchase agreement borrowings totaled $510 million and $554 million, respectively. At both December 31, 2016 and December 31, 2015, $300 million of Park's repurchase agreement borrowings were classified as long-term debt, with the remaining amount being classified as short-term debt on the Consolidated Balance Sheets. These borrowings were collateralized with U.S. government and agency securities with a carrying value of $569 million and $622 million at December 31, 2016 and December 31, 2015, respectively. Declines in the value of the collateral would require Park to pledge additional securities. As of December 31, 2016 and December 31, 2015, Park had $640 million and $583 million, respectively, of available unpledged securities.

The following table presents the carrying value of Park's repurchase agreements by remaining contractual maturity and collateral pledged at December 31, 2016 and December 31, 2015:

	December 31, 2016
(In thousands)	Remaining Contractual Maturity of the Agreements
	Overnight and Continuous		Up to 30 days		30 - 90 days		Greater than 90 days		Total
U.S. government and agency securities	$	208,691	$	—	$	—	$	301,104	$	509,795
	December 31, 2015
(In thousands)	Remaining Contractual Maturity of the Agreements
	Overnight and Continuous		Up to 30 days		30 - 90 days		Greater than 90 days		Total
U.S. government and agency securities	$	247,618	$	2,239	$	—	$	304,385	$	554,242

See Note 13 - Short-Term Borrowings for additional information related to repurchase agreements classified as short-term borrowings. See Note 14 - Long-Term Debt for additional information related to repurchase agreements classified as long-term debt.

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Short-Term Borrowings

12 Months Ended

Dec. 31, 2016

Short-term Debt [Abstract]

Short-Term Borrowings

Short-Term Borrowings

Short-term borrowings were as follows:

December 31 (In thousands)	2016		2015
Securities sold under agreements to repurchase	$	209,795	$	254,242
FHLB advances	185,000		140,000
Total short-term borrowings	$	394,795	$	394,242

The outstanding balances for all short-term borrowings as of December 31, 2016 and 2015 and the weighted-average interest rates as of and paid during each of the years then ended were as follows: 

(In thousands)	Repurchase agreements			FHLB Advances
2016
Ending balance	$	209,795		$	185,000
Highest month-end balance	248,277			185,000
Average daily balance	224,763			15,694
Weighted-average interest rate:
As of year-end	0.17		%	0.80		%
Paid during the year	0.16		%	0.63		%
2015
Ending balance	$	254,242		$	140,000
Highest month-end balance	278,324			140,000
Average daily balance	257,622			1,096
Weighted-average interest rate:
As of year-end	0.17		%	0.56		%
Paid during the year	0.18		%	0.59		%

During 2015 and 2016, outstanding FHLB advances were collateralized by investment securities owned by the Corporation’s bank subsidiary and by various loans pledged under a blanket agreement by the Corporation’s bank subsidiary. At December 31, 2016 and 2015, $25 million and $21 million, respectively, of investment securities were pledged as collateral for FHLB advances. At December 31, 2016 and 2015, $1,909 million and $1,985 million, respectively, of commercial real estate and residential mortgage loans were pledged under a blanket agreement to the FHLB by Park’s bank subsidiary. See Note 12 - Repurchase Agreement Borrowings for information related to investment securities collateralizing repurchase agreements.

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Long-Term Debt

12 Months Ended

Dec. 31, 2016

Debt Disclosure [Abstract]

Long-Term Debt

Long-Term Debt

Long-term debt is listed below:

December 31,	2016					2015
(In thousands)	Outstanding Balance			Average Rate		Outstanding Balance			Average Rate
Total Federal Home Loan Bank advances by year of maturity:
2017	$	50,000		1.25	%	$	50,000		1.25	%
2018	150,000			2.04	%	150,000			2.04	%
2019	75,000			1.96	%	75,000			1.96	%
2020	25,000			2.14	%	25,000			2.14	%
2021	—			—	%	—			—	%
Thereafter	100,000			3.40	%	150,000			3.32	%
Total	$	400,000		2.27	%	450,000			2.37	%
Total broker repurchase agreements by year of maturity:
2017	300,000			1.75	%	300,000			1.75	%
Total	$	300,000		1.75	%	$	300,000		1.75	%
Total combined long-term debt by year of maturity:
2017	350,000			1.68	%	350,000			1.68	%
2018	150,000			2.04	%	150,000			2.04	%
2019	75,000			1.96	%	75,000			1.96	%
2020	25,000			2.14	%	25,000			2.14	%
2021	—			—	%	—			—	%
Thereafter	100,000			3.40	%	150,000			3.32	%
Total	$	700,000		2.05	%	$	750,000		2.12	%
Prepayment penalty	(5,719		)	—		(11,895		)	—
Total long-term debt	$	694,281		2.07	%	$	738,105		2.16	%

On November 30, 2012, Park restructured $300 million in repurchase agreements at a rate of 1.75%. As part of this restructuring, Park paid a prepayment penalty of $25 million. The penalty is being amortized as an adjustment to interest expense over the remaining term of the repurchase agreements using the effective interest method, resulting in an effective interest rate of 3.55%. Of the $25 million prepayment penalty, $4.7 million remained to be amortized as of December 31, 2016. The remaining $4.7 million will be amortized in 2017.

On November 21, 2014, Park restructured $50 million in FHLB advances at a rate of 1.25%. As part of this restructuring, Park paid a prepayment penalty of $3.2 million. The penalty is being amortized as an adjustment to interest expense over the remaining term of the advances using the effective interest method, resulting in an effective interest rate of 3.52%. Of the $3.2 million prepayment penalty, $1.0 million remained to be amortized as of December 31, 2016. The remaining $1.0 million will be amortized in 2017.

On March 30, 2015, Park prepaid $54.5 million of FHLB advances, with a weighted average rate of 1.59%, resulting in a prepayment penalty of $532,000 recognized within other expense on the Consolidated Statements of Income.

On October 20, 2016, Park prepaid $50.0 million of FHLB advances, incurring a $5.6 million prepayment penalty recognized within other expense on the Consolidated Statements of Income. These advances had an interest rate of 3.15% and a maturity date of November 13, 2023.

Park had approximately $100.0 million of long-term debt at December 31, 2016 with a contractual maturity longer than five years. However, all of this debt is callable by the lender in 2017.

At December 31, 2016 and 2015, FHLB advances were collateralized by investment securities owned by PNB’s banking divisions and by various loans pledged under a blanket agreement by PNB's banking divisions. At December 31, 2016 and 2015, $25 million and $21 million, respectively, of investment securities were pledged as collateral for FHLB advances. At December 31, 2016 and 2015, $1,909 million and $1,985 million, respectively, of commercial real estate and residential mortgage loans were pledged under a blanket agreement to the FHLB by Park's bank subsidiary. See Note 12 - RepurchaseAgreement Borrowings for information related to investment securities collateralizing repurchase agreements.

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Subordinated Debentures/Notes

12 Months Ended

Dec. 31, 2016

Long-term Debt, Unclassified [Abstract]

Subordinated Debentures/Notes

Subordinated Notes

As part of the acquisition of Vision's parent bank holding company ("Vision Parent") on March 9, 2007, Park became the successor to Vision Parent under (i) the Amended and Restated Trust Agreement of Vision Bancshares Trust I (the “Trust”), dated as of December 5, 2005, (ii) the Junior Subordinated Indenture, dated as of December 5, 2005, and (iii) the Guarantee Agreement, also dated as of December 5, 2005.

On December 1, 2005, Vision Parent formed a wholly-owned Delaware statutory business trust, Vision Bancshares Trust I (“Trust I”), which issued $15.0 million of Trust I's floating rate preferred securities (the “Trust Preferred Securities”) to institutional investors. These Trust Preferred Securities qualify as Tier I capital under FRB guidelines. All of the common securities of Trust I are owned by Park. The proceeds from the issuance of the common securities and the Trust Preferred Securities were used by Trust I to purchase $15.5 million of junior subordinated notes, which carry a floating rate based on three-month LIBOR plus 148 basis points. The debentures represent the sole asset of Trust I. The Trust Preferred Securities accrue and pay distributions at a floating rate of three-month LIBOR plus 148 basis points per annum. The Trust Preferred Securities are mandatorily redeemable upon maturity of the notes in December 2035, or upon earlier redemption as provided in the notes. Park has the right to redeem the notes purchased by Trust I in whole or in part, on or after December 30, 2010. As specified in the indenture, if the notes are redeemed prior to maturity, the redemption price will be the principal amount, plus any unpaid accrued interest. In accordance with GAAP, Trust I is not consolidated with Park’s financial statements, but rather the subordinated notes are reflected as a liability.

On December 23, 2009, Park entered into a Note Purchase Agreement, dated December 23, 2009, with 38 purchasers (the “2009 Purchasers”). Under the terms of the Note Purchase Agreement, the 2009 Purchasers purchased from Park an aggregate principal amount of $35.25 million of 10% Subordinated Notes due December 23, 2019 (the “2009 Notes”). The 2009 Notes were intended to qualify as Tier 2 capital under applicable rules and regulations of the FRB. The 2009 Notes could not be prepaid in any amount prior to December 23, 2014; however, subsequent to that date, Park could prepay, without penalty, all or a portion of the principal amount outstanding. Of the $35.25 million in 2009 Notes, $14.05 million were purchased by related parties. The 2009 Notes were prepaid in full on December 24, 2014, together with accrued interest.

On April 20, 2012, Park entered into a Note Purchase Agreement, dated April 20, 2012 (the “2012 Purchase Agreement”), with 56 purchasers (the "2012 Purchasers"). Under the terms of the 2012 Purchase Agreement, the 2012 Purchasers purchased from Park an aggregate principal amount of $30 million of 7% Subordinated Notes due April 20, 2022 (the "2012 Notes"). The 2012 Notes are intended to qualify as Tier 2 capital under applicable rules and regulations of the FRB. Each 2012 Note was purchased at a purchase price of 100% of the principal amount thereof. The 2012 Notes may not be prepaid by Park prior to April 20, 2017. From and after April 20, 2017, Park may prepay all or, from time to time, any part of the 2012 Notes at 100% of the principal amount (plus accrued interest) without penalty, subject to any requirement under FRB regulations to obtain prior approval from the FRB before making any prepayment.

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Contingent Liabilities (Notes)

12 Months Ended

Dec. 31, 2016

Loss Contingencies [Line Items]

Commitments and Contingencies Disclosure [Text Block]

Contingent Liabilities

The Company is a defendant in lawsuits and other adversary proceedings arising in the ordinary course of business. Legal costs incurred in connection with the resolution of claims and lawsuits are generally expensed as incurred, and the Company establishes accruals for the outcome of litigation where losses are deemed probable and reasonably estimable. The Company’s assessment of the current exposure could change in the event of the discovery of additional facts with respect to legal matters pending against the Company or determinations by judges, juries, administrative agencies or other finders of fact that are not in accordance with the Company’s evaluation of claims.

As of December 31, 2016, the Company had accrued charges of approximately $2.3 million for legal contingencies related to various legal and other adversary proceedings.

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Share-Based Compensation

12 Months Ended

Dec. 31, 2016

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Stock Option Plan

Share-Based Compensation

The Park National Corporation 2013 Long-Term Incentive Plan (the "2013 Incentive Plan") was adopted by the Board of Directors of Park on January 28, 2013 and was approved by Park's shareholders at the Annual Meeting of Shareholders on April 22, 2013. The 2013 Incentive Plan makes equity-based awards and cash-based awards available for grant to participants in the form of incentive stock options, nonqualified stock options, stock appreciation rights, restricted common shares, restricted stock unit awards that may be settled in common shares, cash or a combination of the two, unrestricted common shares and cash-based awards. Under the 2013 Incentive Plan, 600,000 common shares are authorized to be issued and delivered in connection with grants under the 2013 Incentive Plan. The common shares to be issued and delivered under the 2013 Incentive Plan may consist of either common shares currently held or common shares subsequently acquired by Park as treasury shares, including common shares purchased in the open market or in private transactions. No awards may be made under the 2013 Incentive Plan after April 22, 2023. At December 31, 2016, 473,725 common shares were available for future grants under the 2013 Incentive Plan.

During 2016, 2015, and 2014, Park granted 9,950, 10,150, and 10,200 common shares, respectively, to directors of Park and to directors of Park's bank subsidiary PNB (and its divisions) under the 2013 Incentive Plan.  The common shares granted to directors were not subjected to a vesting period and resulted in expense of $950,000, $963,000, and $801,000 in 2016, 2015, and 2014, respectively, which is included in Professional fees and services on the Consolidated Statements of Income. 

During 2016, 2015 and 2014, the Compensation Committee of the Board of Directors of Park granted awards of an aggregate of 41,550, 23,025 and 21,975, respectively, performance based restricted stock units ("PBRSUs") to certain employees of Park and its subsidiaries. The number of PBRSUs earned or settled will depend on certain performance conditions and are also subject to service based vesting. None of the PBRSUs had vested as of December 31, 2016. As of December 31, 2016, an aggregate of 1,125 PBRSUs had been forfeited.

A summary of changes in Park's nonvested shares for the year ended December 31, 2016 follows:

	Shares
Nonvested at January 1, 2016	44,700
Granted	41,550
Vested	—
Forfeited	825
Nonvested at December 31, 2016	85,425

Share-based compensation expense of $1.9 million, $865,000 and $458,000 was recognized for the years ended December 31, 2016, 2015 and 2014, respectively, related to PBRSU awards to employees. The following table details expected additional share-based compensation expense related to PBRSUs currently outstanding:

(In thousands)
2017	$	1,193
2018	1,072
2019	491
2020	83
Total	$	2,839

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Benefit Plans

12 Months Ended

Dec. 31, 2016

Defined Benefit Pension Plans and Defined Benefit Postretirement Plans Disclosure [Abstract]

Benefit Plans

Benefit Plans

The Corporation has a noncontributory Defined Benefit Pension Plan (the “Pension Plan”) covering substantially all of the employees of the Corporation and its subsidiaries. The Pension Plan provides benefits based on an employee’s years of service and compensation.

There were no pension contributions in 2015 or 2016 and there is no contribution expected to be made in 2017.

Using an accrual measurement date of December 31, 2016 and 2015, plan assets and benefit obligation activity for the Pension Plan are listed below:

(In thousands)	2016			2015
Change in fair value of plan assets
Fair value at beginning of measurement period	$	153,498		$	160,598
Actual return on plan assets	19,256			(58		)
Benefits paid	(5,707		)	(7,042		)
Fair value at end of measurement period	$	167,047		$	153,498
Change in benefit obligation
Projected benefit obligation at beginning of measurement period	$	102,245		$	109,328
Service cost	5,055			5,368
Interest cost	4,869			4,695
Actuarial loss (gains)	7,993			(10,104		)
Benefits paid	(5,707		)	(7,042		)
Projected benefit obligation at the end of measurement period	$	114,455		$	102,245
Funded status at end of year (fair value of plan assets less benefit obligation)	$	52,592		$	51,253

The asset allocation for the Pension Plan as of each measurement date, by asset category, was as follows:

		Percentage of Plan Assets
Asset category	Target Allocation	2016		2015
Equity securities	50% - 100%	84	%	85	%
Fixed income and cash equivalents	remaining balance	16	%	15	%
Total		100	%	100	%

The investment policy, as established by the Retirement Plan Committee, is to invest assets according to the target allocation stated above. Assets will be reallocated periodically based on the investment strategy of the Retirement Plan Committee. The investment policy is reviewed periodically.

The expected long-term rate of return on plan assets used to measure the benefit obligation was 7.00% as of December 31, 2016 and 7.25% as of December 31, 2015. This return was based on the expected return of each of the asset categories, weighted based on the median of the target allocation for each class.

The accumulated benefit obligation for the Pension Plan was $97.2 million and $86.1 million at December 31, 2016 and 2015, respectively.

On November 17, 2009, the Park Pension Plan completed the purchase of 115,800 common shares of Park for $7.0 million or $60.45 per share. At December 31, 2016 and 2015, the fair value of the 115,800 common shares held by the Pension Plan was $13.9 million, or $119.66 per share and $10.5 million, or $90.48 per share, respectively.

The weighted average assumptions used to determine benefit obligations at December 31, 2016, 2015 and 2014 were as follows:

	2016		2015		2014
Discount rate	4.58	%	4.88	%	4.42	%
Rate of compensation increase
Under age 30	10.00	%	10.00	%	10.00	%
Ages 30-39	6.00	%	6.00	%	6.00	%
Ages 40-49	4.00	%	3.00	%	3.00	%
Ages 50 and over	3.00	%	3.00	%	3.00	%

The estimated future pension benefit payments reflecting expected future service for the next ten years are shown below (in thousands):

2017	$	6,924
2018	7,644
2019	7,875
2020	8,393
2021	9,503
2022-2026	48,058
Total	$	88,397

The following table shows ending balances of accumulated other comprehensive loss at December 31, 2016 and 2015.

(In thousands)	2016			2015
Prior service cost	$	—		$	—
Net actuarial loss	(22,677		)	(23,618		)
Total	(22,677		)	(23,618		)
Deferred taxes	7,937			8,267
Accumulated other comprehensive loss	$	(14,740	)	$	(15,351	)

Using an actuarial measurement date of December 31 for 2016, 2015 and 2014, components of net periodic benefit income and other amounts recognized in other comprehensive income (loss) were as follows:

(In thousands)	2016			2015			2014
Components of net periodic benefit income and other amounts recognized in other comprehensive income
Service cost	$	(5,055	)	$	(5,368	)	$	(4,331	)
Interest cost	(4,869		)	(4,695		)	(4,577		)
Expected return on plan assets	10,950			11,420			10,869
Amortization of prior service cost	—			(15		)	(19		)
Recognized net actuarial loss	(773		)	(637		)	—
Net periodic benefit income	$	253		$	705		$	1,942
Change to net actuarial gain (loss) for the period	$	168		$	(1,400	)	$	(14,276	)
Amortization of prior service cost	—			15			19
Amortization of net loss	773			637			—
Total recognized in other comprehensive income (loss)	941			(748		)	(14,257		)
Total recognized in net benefit income and other comprehensive income (loss)	$	1,194		$	(43	)	$	(12,315	)

There are no estimated prior service costs for the Pension Plan to be amortized from accumulated other comprehensive income (loss) into net periodic benefit cost over the next fiscal year. The estimated net actuarial loss expected to be recognized in the next fiscal year is $576,000.

The weighted average assumptions used to determine net periodic benefit cost for the years ended December 31, 2016, 2015 and 2014 are listed below:

	2016		2015		2014
Discount Rate	4.88	%	4.42	%	5.30	%
Rate of compensation increase
Under age 30	10.00	%	10.00	%	10.00	%
Ages 30-39	6.00	%	6.00	%	6.00	%
Ages 40 and over	3.00	%	3.00	%	3.00	%
Expected long-term return on plan assets	7.25	%	7.25	%	7.25	%

The Pension Plan maintains cash in a PNB savings account. The Pension Plan cash balance was $2.5 million at December 31, 2016.

GAAP defines fair value as the price that would be received by Park for an asset or paid by Park to transfer a liability (an exit price) in an orderly transaction between market participants on the measurement date, using the most advantageous market for the asset or liability. The fair values of equity securities, consisting of mutual fund investments and common stock (U.S. large cap) held by the Pension Plan and the fixed income and cash equivalents, are determined by obtaining quoted prices on nationally recognized securities exchanges (Level 1 inputs). The fair value of Pension Plan assets at December 31, 2016 was $167.0 million. At December 31, 2016, $149.2 million of equity investments and cash in the Pension Plan were categorized as Level 1 inputs; $17.8 million of plan investments in corporate (U.S. large cap) and U.S. Government sponsored entity bonds were categorized as Level 2 inputs, as fair value was based on quoted market prices of comparable instruments; and no investments were categorized as Level 3 inputs. The fair value of Pension Plan assets was $153.5 million at December 31, 2015. At December 31, 2015, $135.0 million of investments in the Pension Plan were categorized as Level 1 inputs; $18.5 million were categorized as Level 2; and no investments were categorized as Level 3.

The Corporation has a voluntary salary deferral plan covering substantially all of the employees of the Corporation and its subsidiaries. Eligible employees may contribute a portion of their compensation subject to a maximum statutory limitation. The Corporation provides a matching contribution established annually by the Corporation. Contribution expense for the Corporation was $1.3 million, $1.2 million, and $1.1 million for 2016, 2015 and 2014, respectively.

The Corporation has entered into Supplemental Executive Retirement Plan Agreements (the "SERP Agreements") with certain key officers of the Corporation and its subsidiaries which provide defined pension benefits in excess of limits imposed by federal tax law. The accrued benefit cost for the SERP Agreements totaled $8.8 million and $8.0 million for 2016 and 2015, respectively. The expense for the Corporation was $1.5 million for 2016, $1.1 million for 2015 and $1.5 million for 2014.

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Income Taxes

12 Months Ended

Dec. 31, 2016

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes

Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of the Corporation’s deferred tax assets and liabilities are as follows:

December 31 (In thousands)	2016		2015
Deferred tax assets:
Allowance for loan losses	$	17,719	$	19,773
Accumulated other comprehensive loss – Pension plan	7,937		8,266
Accumulated other comprehensive loss – Unrealized losses on securities	1,618		157
Deferred compensation	4,140		3,908
OREO valuation adjustments	2,322		2,418
Net deferred loan fees	1,397		1,204
Deferred contract bonus	1,074		1,031
Nonvested equity-based compensation	1,115		463
Fixed assets	781		413
Accrued litigation	793		482
Other	2,525		2,813
Total deferred tax assets	$	41,421	$	40,928
Deferred tax liabilities:
Deferred investment income	10,199		10,199
Pension plan	26,344		26,205
Mortgage servicing rights	3,243		3,153
Partnership adjustments	549		560
Other	596		872
Total deferred tax liabilities	$	40,931	$	40,989
Net deferred tax asset (liability)	$	490	$	(61	)

Park performs an analysis to determine if a valuation allowance against deferred tax assets is required in accordance with GAAP. Management has determined that it is not required to establish a valuation allowance against the December 31, 2016 or 2015 deferred tax assets in accordance with GAAP since it is more likely than not that the deferred tax assets will be fully utilized in future periods.

The components of the provision for federal income taxes are shown below:

December 31, (In thousands)	2016		2015			2014
Currently payable
Federal	$	28,879	$	26,153		$	27,062
Amortization of qualified affordable housing projects	7,300		6,664			6,869
Deferred
Federal	581		(250		)	2,528
Total	$	36,760	$	32,567		$	36,459

The following is a reconciliation of income tax expense to the amount computed at the statutory rate of 35% for the years ended December 31, 2016, 2015 and 2014.

	2016		2015		2014
Statutory federal corporate tax rate	35.0	%	35.0	%	35.0	%
Changes in rates resulting from:
Tax exempt interest income, net of disallowed interest	(1.3	)%	(0.5	)%	(0.5	)%
Bank owned life insurance	(1.2	)%	(1.8	)%	(1.4	)%
Investments in qualified affordable housing projects, net of tax benefits	(1.7	)%	(1.9	)%	(1.6	)%
Other tax credits	—	%	(0.9	)%	—	%
KSOP dividend deduction	(1.0	)%	(1.0	)%	(1.0	)%
Other	0.1	%	(0.2	)%	(0.2	)%
Effective tax rate	29.9	%	28.7	%	30.3	%

Park and its subsidiaries do not pay state income tax to the state of Ohio, but pay a franchise tax based on equity. The franchise tax expense is included in "State tax expense" on Park’s Consolidated Statements of Income.

Unrecognized Tax Benefits

The following is a reconciliation of the beginning and ending amount of unrecognized tax benefits.

(In thousands)	2016			2015			2014
January 1 Balance	$	558		$	532		$	518
Additions based on tax positions related to the current year	117			80			76
Additions for tax positions of prior years	38			16			14
Reductions for tax positions of prior years	—			—			—
Reductions due to statute of limitations	(80		)	(70		)	(76		)
December 31 Balance	$	633		$	558		$	532

The amount of unrecognized tax benefits that, if recognized, would favorably affect the effective income tax rate in the future periods at December 31, 2016, 2015 and 2014 was $482,000, $432,000 and $413,000, respectively. Park does not expect the total amount of unrecognized tax benefits to significantly increase or decrease during the next year.

The expense related to interest and penalties recorded on unrecognized tax benefits in the Consolidated Statements of Income for the years ended December 31, 2016, and 2015 was $1,500 and $2,000, respectively. There was no expense related to interest and penalties for the year ended December 31, 2014. The amount accrued for interest and penalties at December 31, 2016, 2015 and 2014 was $70,500, $69,000 and $67,000, respectively.

Park and its subsidiaries are subject to U.S. federal income tax and income tax in various state jurisdictions. The Corporation is subject to routine audits of tax returns by the Internal Revenue Service and states in which we conduct business. No material adjustments have been made on closed federal and state tax audits. All tax years ending prior to December 31, 2013 are closed to examination by the federal taxing authorities. Generally, all tax years prior to December 31, 2012 are closed to examination by state taxing authorities.

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Other Comprehensive Income (Loss)

12 Months Ended

Dec. 31, 2016

Other Comprehensive Income (Loss) [Abstract]

Other Comprehensive Income (Loss)

Other Comprehensive Income (Loss)

Other comprehensive income (loss) components, net of income tax, are shown in the following table for the years ended December 31, 2016, 2015 and 2014.

Year ended December 31, (in thousands)		Changes in Pension Plan assets and benefit obligations			Unrealized gains and losses on available-for-sale securities			Total
Beginning balance at January 1, 2016		$	(15,351	)	$	(292	)	$	(15,643	)
	Other comprehensive gain (loss) before reclassifications	109			(2,713		)	(2,604		)
	Amounts reclassified from accumulated other comprehensive loss	502			—			502
Net current period other comprehensive income (loss)		611			(2,713		)	(2,102		)
Ending balance at December 31, 2016		$	(14,740	)	$	(3,005	)	$	(17,745	)
Beginning balance at January 1, 2015		$	(14,865	)	$	1,257		$	(13,608	)
	Other comprehensive loss before reclassifications	(910		)	(1,549		)	(2,459		)
	Amounts reclassified from accumulated other comprehensive loss	424			—			424
Net current period other comprehensive loss		(486		)	(1,549		)	(2,035		)
Ending balance at December 31, 2015		$	(15,351	)	$	(292	)	$	(15,643	)
Beginning balance at January 1, 2014		$	(5,598	)	$	(29,821	)	$	(35,419	)
	Other comprehensive (loss) gain before reclassifications	(9,279		)	30,325			21,046
	Amounts reclassified from accumulated other comprehensive loss	12			753			765
Net current period other comprehensive (loss) income		(9,267		)	31,078			21,811
Ending balance at December 31, 2014		$	(14,865	)	$	1,257		$	(13,608	)

The following table provides information concerning amounts reclassified out of accumulated other comprehensive loss for the years ended December 31, 2016, 2015 and 2014:

		Amount Reclassified from Accumulated Other Comprehensive Income (Loss)						Affected Line Item in the Consolidated Statement of Income
(In thousands)		2016		2015		2014
Amortization of defined benefit pension items
	Amortization of prior service cost	$	—	$	15	$	19	Employee benefits
	Amortization of net loss	773		637		—		Employee benefits
Income before income taxes		773		652		19		Income before income taxes
	Federal income taxes	271		228		7		Federal income taxes
	Net of income tax	$	502	$	424	$	12	Net of income tax
Unrealized gains & losses on available for sale securities
	Loss on sale of investment securities	$	—	$	—	$	1,158	Gain (loss) on sale of investment securities
	Other than temporary impairment	—		—		—		Miscellaneous expense
Income before income taxes		—		—		1,158		Income before income taxes
	Federal income taxes	—		—		405		Federal income taxes
	Net of income tax	$	—	$	—	$	753	Net of income tax

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Earnings Per Common Share

12 Months Ended

Dec. 31, 2016

Earnings Per Share [Abstract]

Earnings Per Common Share

Earnings Per Common Share

GAAP requires the reporting of basic and diluted earnings per common share. Basic earnings per common share excludes any dilutive effects of restricted stock units.

The following table sets forth the computation of basic and diluted earnings per common share:

Year ended December 31 (In thousands, except share data)	2016		2015		2014
Numerator:
Net income available to common shareholders	$	86,135	$	81,012	$	83,957
Denominator:
Weighted-average common shares outstanding	15,332,553		15,364,281		15,394,971
Effect of dilutive performance-based restricted stock units	72,607		40,459		18,861
Weighted-average common shares outstanding adjusted for the effect of dilutive performance-based restricted stock units	15,405,160		15,404,740		15,413,832
Earnings per common share:
Basic earnings per common share	$	5.62	$	5.27	$	5.45
Diluted earnings per common share	$	5.59	$	5.26	$	5.45

Park awarded 41,550, 23,025 and 21,975 PBRSUs to certain employees during the years ended December 31, 2016, 2015 and 2014, respectively. The PBRSUs vest based on service and performance conditions. The dilutive effect of the PBRSUs was the addition of 72,607, 40,459 and 18,861 common shares for the years ended December 31, 2016, 2015 and 2014, respectively.

During the years ended December 31, 2015 and 2014, Park repurchased 71,700 and 29,700 common shares, respectively, to fund the PBRSUs and common shares awarded to directors of Park and to directors of Park's subsidiary PNB (and its divisions). No common shares were repurchased during 2016.

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Dividend Restrictions

12 Months Ended

Dec. 31, 2016

Disclosure of Restrictions on Dividends, Loans and Advances Disclosure [Abstract]

Dividend Restrictions

Dividend Restrictions

Bank regulators limit the amount of dividends a subsidiary bank can declare in any calendar year without obtaining prior approval. At December 31, 2016, approximately $71.7 million of the total shareholders’ equity of PNB was available for the payment of dividends to the Corporation, without approval by the applicable regulatory authorities.

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Financial Instruments With Off-Balance Sheet Risk And Financial Instruments With Concentrations Of Credit Risk

12 Months Ended

Dec. 31, 2016

Risks and Uncertainties [Abstract]

Financial Instruments with Off-Balance Sheet Risk and Financial Instruments with Concentration of Credit Risk

Financial Instruments with Off-Balance Sheet Risk and Financial Instruments with Concentrations of Credit Risk

The Corporation is party to financial instruments with off-balance sheet risk in the normal course of business to meet the financing needs of its customers. These financial instruments include loan commitments and standby letters of credit. The instruments involve, to varying degrees, elements of credit and interest rate risk in excess of the amount recognized in the consolidated financial statements.

The Corporation’s exposure to credit loss in the event of nonperformance by the other party to the financial instrument for loan commitments and standby letters of credit is represented by the contractual amount of those instruments. The Corporation uses the same credit policies in making commitments and conditional obligations as it does for on-balance sheet instruments. Since many of the loan commitments may expire without being drawn upon, the total commitment amount does not necessarily represent future cash requirements. The credit risk involved in issuing letters of credit is essentially the same as that involved in extending loan commitments to customers.

The total amounts of off-balance sheet financial instruments with credit risk were as follows:

December 31 (In thousands)	2016		2015
Loan commitments	$	912,007	$	888,411
Standby letters of credit	13,746		12,326

The loan commitments are generally for variable rates of interest.

The Corporation grants retail, commercial and commercial real estate loans to customers primarily located in Ohio. The Corporation evaluates each customer’s creditworthiness on a case-by-case basis. The amount of collateral obtained, if deemed necessary by the Corporation upon extension of credit, is based on management’s credit evaluation of the customer. Collateral held varies but may include accounts receivable, inventory, property, plant and equipment, and income-producing commercial properties.

Although the Corporation has a diversified loan portfolio, a substantial portion of the borrowers’ ability to honor their contracts is dependent upon the economic conditions in each borrower’s geographic location and industry.

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Loan Servicing

12 Months Ended

Dec. 31, 2016

Transfers and Servicing of Financial Assets [Abstract]

Loan Servicing

Loan Servicing

Park serviced sold mortgage loans of $1,330 million at December 31, 2016, compared to $1,276 million at December 31, 2015 and $1,265 million at December 31, 2014. At December 31, 2016, $4.1 million of the sold mortgage loans were sold with recourse compared to $5.4 million at December 31, 2015 and $7.0 million at December 31, 2014. Management closely monitors the delinquency rates on the mortgage loans sold with recourse. As of December 31, 2016 and 2015, management had established a reserve of $266,000 and $454,000, respectively, to account for future loan repurchases.

When Park sells mortgage loans with servicing rights retained, servicing rights are initially recorded at fair value. Park selected the “amortization method” as permissible within U.S. GAAP, whereby the servicing rights capitalized are amortized in proportion to and over the period of estimated future servicing income of the underlying loan. At the end of each reporting period, the carrying value of mortgage servicing rights (“MSRs”) is assessed for impairment with a comparison to fair value. MSRs are carried at the lower of their amortized cost or fair value. The amortization of mortgage loan servicing rights is included within “Other service income” in the Consolidated Statements of Income.

Activity for mortgage servicing rights and the related valuation allowance follows:

December 31 (In thousands)	2016			2015			2014
Mortgage servicing rights:
Carrying amount, net, beginning of year	$	9,008		$	8,613		$	9,013
Additions	2,286			1,748			1,026
Amortization	(1,835		)	(1,637		)	(1,631		)
Change in valuation allowance	(193		)	284			205
Carrying amount, net, end of year	$	9,266		$	9,008		$	8,613
Valuation allowance:
Beginning of year	$	542		$	826		$	1,031
Change in valuation allowance	193			(284		)	(205		)
End of year	$	735		$	542		$	826

The fair value of mortgage servicing rights was $9.3 million and $9.6 million at December 31, 2016 and 2015, respectively. The fair value of mortgage servicing rights at December 31, 2016 was established using a discount rate of 13% and constant prepayment speeds ranging from 6.2% to 16.8%. The fair value of mortgage servicing rights at December 31, 2015 was established using a discount rate of 10% and constant prepayment speeds ranging from 6.3% to 22.0%.

Servicing fees included in other service income were $3.4 million, $3.4 million and $3.5 million for the years ended December 31, 2016, 2015 and 2014, respectively.

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Fair Values

12 Months Ended

Dec. 31, 2016

Fair Value Disclosures [Abstract]

Fair Values

Fair Value

The fair value hierarchy requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The three levels of inputs that Park uses to measure fair value are as follows:

• Level 1: Quoted prices (unadjusted) for identical assets or liabilities in active markets that Park has the ability to access as of the measurement date.

• Level 2: Level 1 inputs for assets or liabilities that are not actively traded. Also consists of an observable market price for a similar asset or liability. This includes the use of “matrix pricing” to value debt securities absent the exclusive use of quoted prices.

• Level 3: Consists of unobservable inputs that are used to measure fair value when observable market inputs are not available. This could include the use of internally developed models, financial forecasting and similar inputs.

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability between market participants at the balance sheet date. When possible, the Company looks to active and observable markets to price identical assets or liabilities. When identical assets and liabilities are not traded in active markets, the Company looks to observable market data for similar assets and liabilities. However, certain assets and liabilities are not traded in observable markets and Park must use other valuation methods to develop a fair value. The fair value of impaired loans is typically based on the fair value of the underlying collateral, which is estimated through third-party appraisals or internal estimates of collateral values in accordance with Park's valuation requirements per its commercial and real estate loan policies.

Assets and Liabilities Measured at Fair Value on a Recurring Basis:

The following table presents assets and liabilities measured at fair value on a recurring basis:

Fair Value Measurements at December 31, 2016 using:
(In thousands)	Level 1		Level 2		Level 3		Balance at December 31, 2016
Assets
Investment securities:
Obligations of U.S. Treasury and other U.S. Government sponsored entities	$	—	$	267,533	$	—	$	267,533
U.S. Government sponsored entities’ asset-backed securities	—		987,172		—		987,172
Equity securities	2,644		—		790		3,434
Mortgage loans held for sale	—		10,413		—		10,413
Mortgage IRLCs	—		124		—		124
Liabilities
Fair value swap	$	—	$	—	$	226	$	226

Fair Value Measurements at December 31, 2015 using:
(In thousands)	Level 1		Level 2		Level 3		Balance at December 31, 2015
Assets
Investment securities:
Obligations of U.S. Treasury and other U.S. Government sponsored entities	$	—	$	522,063	$	—	$	522,063
U.S. Government sponsored entities’ asset-backed securities	—		911,493		—		911,493
Equity securities	1,941		—		769		2,710
Mortgage loans held for sale	—		7,306		—		7,306
Mortgage IRLCs	—		165		—		165
Liabilities
Fair value swap	$	—	$	—	$	226	$	226

There were no transfers between Level 1 and Level 2 during 2016 or 2015. Management’s policy is to transfer assets or liabilities from one level to another when the methodology to obtain the fair value changes such that there are more or fewer unobservable inputs as of the end of the reporting period.

The following methods and assumptions were used by the Company in determining fair value of the financial assets and liabilities discussed above:

Investment securities: Fair values for investment securities are based on quoted market prices, where available. If quoted market prices are not available, fair values are based on quoted market prices of comparable instruments. For securities where quoted prices or market prices of similar securities are not available, fair values are calculated using discounted cash flows.

Fair value swap: The fair value of the swap agreement entered into with the purchaser of the Visa Class B shares represents an internally developed estimate of the exposure based upon probability-weighted potential Visa litigation losses.

Mortgage Interest Rate Lock Commitments (IRLCs): IRLCs are based on current secondary market pricing and are classified as Level 2.

Mortgage loans held for sale: Mortgage loans held for sale are carried at their fair value. Mortgage loans held for sale are estimated using security prices for similar product types and, therefore, are classified in Level 2.

The table below is a reconciliation of the beginning and ending balances of the Level 3 inputs for the years ended December 31, 2016 and 2015, for financial instruments measured on a recurring basis and classified as Level 3:

Level 3 Fair Value Measurements
(In thousands)	Equity Securities			Fair Value Swap
Balance at January 1, 2016	$	769		$	(226	)
Total Gains (Losses)
Included in earnings - realized	—			—
Included in earnings - unrealized	—			—
Included in other comprehensive income	21			—
Purchases, sales, issuances and settlements, other, net	—			—
Re-evaluation of fair value swap	—			—
Balance at December 31, 2016	$	790		$	(226	)
Balance at January 1, 2015	$	776		$	(226	)
Total Gains (Losses)
Included in earnings - realized	—			—
Included in earnings - unrealized	—			—
Included in other comprehensive income	(7		)	—
Purchases, sales, issuances and settlements, other, net	—			—
Re-evaluation of fair value swap	—			—
Balance at December 31, 2015	$	769		$	(226	)

Assets and liabilities measured at fair value on a nonrecurring basis:

The following methods and assumptions were used by the Company in determining the fair value of assets and liabilities measured at fair value on a nonrecurring basis described below:

Impaired Loans: At the time a loan is considered impaired, it is valued at the lower of cost or fair value. Impaired loans carried at fair value have been partially charged off or receive specific allocations of the allowance for loan losses. For collateral dependent loans, fair value is generally based on real estate appraisals. These appraisals may utilize a single valuation approach or a combination of approaches including comparable sales and the income approach. Adjustments are routinely made in the appraisal process by the independent appraisers to adjust for differences between the comparable sales and income data available. Such adjustments result in a Level 3 classification of the inputs for determining fair value. Collateral is then adjusted or discounted based on management’s historical knowledge, changes in market conditions from the time of the valuation, and management’s expertise and knowledge of the client and client’s business, also resulting in a Level 3 fair value classification. Impaired loans are evaluated on a quarterly basis for additional impairment and adjusted accordingly. Additionally, updated independent valuations are obtained annually for all impaired loans in accordance with Company policy.

Other Real Estate Owned (OREO): Assets acquired through or in lieu of loan foreclosure are initially recorded at fair value less costs to sell when acquired. The carrying value of OREO is not re-measured to fair value on a recurring basis, but is subject to fair value adjustments when the carrying value exceeds the fair value, less estimated selling costs. Fair value is based on recent real estate appraisals and is updated at least annually. These appraisals may utilize a single valuation approach or a combination of approaches including the comparable sales approach and the income approach. Adjustments are routinely made in the appraisal process by the independent appraisers to adjust for differences between the comparable sales and income data available. Such adjustments result in a Level 3 classification of the inputs for determining fair value.

Appraisals for both collateral dependent impaired loans and OREO are performed by licensed appraisers. Appraisals are generally obtained to support the fair value of collateral. In general, there are three types of appraisals, real estate appraisals, income approach appraisals and lot development loan appraisals, received by the Company. These are discussed below:

• Real estate appraisals typically incorporate measures such as recent sales prices for comparable properties. Appraisers may make adjustments to the sales prices of the comparable properties as deemed appropriate based on the age, condition or general characteristics of the subject property. Management generally applies a 15% discount to real estate appraised values which management expects will cover all disposition costs (including selling costs). This 15% is based on historical discounts to appraised values on sold OREO properties.

• Income approach appraisals typically incorporate the annual net operating income of the business divided by an appropriate capitalization rate, as determined by the appraiser. Management generally applies a 15% discount to income approach appraised values which management expects will cover all disposition costs (including selling costs).

• Lot development loan appraisals are typically performed using a discounted cash flow analysis. Appraisers determine an anticipated absorption period and a discount rate that takes into account an investor’s required rate of return based on recent comparable sales. Management generally applies a 6% discount to lot development appraised values, which is an additional discount above the net present value calculation included in the appraisal, to account for selling costs.

MSRs: MSRs are carried at the lower of cost or fair value. MSRs do not trade in active, open markets with readily observable prices. For example, sales of MSRs do occur, but precise terms and conditions typically are not readily available. As such, management, with the assistance of a third-party specialist, determines fair value based on the discounted value of the future cash flows estimated to be received. Significant inputs include the discount rate and assumed prepayment speeds utilized. The calculated fair value is then compared to market values where possible to ascertain the reasonableness of the valuation in relation to current market expectations for similar products. Accordingly, MSRs are classified as Level 2.

The following tables' present assets and liabilities measured at fair value on a nonrecurring basis. Collateral dependent impaired loans are carried at fair value if they have been charged down to fair value or if a specific valuation allowance has been established. A new cost basis is established at the time a property is initially recorded in OREO. OREO properties are carried at fair value if a devaluation has been taken to the property's value subsequent to the initial measurement.

Fair Value Measurements at December 31, 2016 Using:
(In thousands)	Level 1		Level 2		Level 3		Balance at December 31, 2016
Impaired Loans:
Commercial real estate	$	—	$	—	$	3,057	$	3,057
Construction real estate	—		—		541		541
Residential real estate	—		—		2,385		2,385
Total impaired loans	$	—	$	—	$	5,983	$	5,983
Mortgage Servicing Rights	$	—	$	6,769	$	—	$	6,769
Other Real Estate Owned:
Commercial real estate	—		—		2,644		2,644
Construction real estate	—		—		3,322		3,322
Residential real estate	—		—		931		931
Total Other Real Estate Owned	$	—	$	—	$	6,897	$	6,897

Fair Value Measurements at December 31, 2015 Using:
(In thousands)	Level 1		Level 2		Level 3		Balance at December 31, 2015
Impaired Loans:
Commercial real estate	$	—	$	—	$	3,698	$	3,698
Construction real estate:
SEPH commercial land and development	—		—		2,044		2,044
Remaining commercial	—		—		1,872		1,872
Residential real estate	—		—		1,882		1,882
Total impaired loans	$	—	$	—	$	9,496	$	9,496
Mortgage Servicing Rights	$	—	$	1,867	$	—	$	1,867
Other Real Estate Owned:
Commercial real estate	—		—		2,796		2,796
Construction real estate	—		—		3,387		3,387
Residential real estate	—		—		2,332		2,332
Total Other Real Estate Owned	$	—	$	—	$	8,515	$	8,515

The table below provides additional detail on those impaired loans which are recorded at fair value as well as the remaining impaired loan portfolio not included above. The remaining impaired loans consist of loans which are not collateral dependent as well as loans carried at cost as the fair value of the underlying collateral or the present value of expected future cash flows on each of the loans exceeded the book value for each respective credit.

	December 31, 2016
(In thousands)	Recorded Investment		Prior Charge-Offs		Specific Valuation Allowance		Carrying Balance
Impaired loans recorded at fair value	$	6,379	$	3,681	$	396	$	5,983
Remaining impaired loans	64,047		21,262		152		63,895
Total impaired loans	$	70,426	$	24,943	$	548	$	69,878

	December 31, 2015
(In thousands)	Recorded Investment		Prior Charge-Offs		Specific Valuation Allowance		Carrying Balance
Impaired loans recorded at fair value	$	11,783	$	10,512	$	2,287	$	9,496
Remaining impaired loans	68,881		18,193		1,904		66,977
Total impaired loans	$	80,664	$	28,705	$	4,191	$	76,473

The income (expense) from credit adjustments related to impaired loans carried at fair value for the years ended December 31, 2016, 2015 and 2014 was $0.9 million, $(2.1) million, and $(3.0) million, respectively.

MSRs totaled $9.3 million at December 31, 2016. Of this $9.3 million MSR carrying balance, $6.8 million was recorded at fair value and included a valuation allowance of $0.7 million. The remaining $2.5 million was recorded at cost, as the fair value exceeded cost at December 31, 2016. At December 31, 2015, MSRs totaled $9.0 million. Of this $9.0 million MSR carrying balance, $1.9 million was recorded at fair value and included a valuation allowance of $0.5 million. The remaining $7.1 million was recorded at cost, as the fair value exceeded cost at December 31, 2015. The (expense) income related to MSRs carried at fair value for the years ended December 31, 2016, 2015 and 2014 was $(0.2) million, $0.3 million and $0.2 million, respectively.

Total OREO held by Park at December 31, 2016 and 2015 was $13.9 million and $18.7 million, respectively. Approximately 50% and 46% of OREO held by Park at December 31, 2016 and 2015, respectively, was carried at fair value due to fair value adjustments made subsequent to the initial OREO measurement. At December 31, 2016 and 2015, OREO held at fair value, less estimated selling costs, amounted to $6.9 million and $8.5 million, respectively. The net expense related to OREO fair value adjustments was $0.6 million, $1.6 million and $2.4 million for the years ended December 31, 2016, 2015 and 2014, respectively.

The following tables present quantitative information about Level 3 fair value measurements for financial instruments measured at fair value on a non-recurring basis at December 31, 2016 and December 31, 2015:

December 31, 2016
(In thousands)	Fair Value		Valuation Technique	Unobservable Input(s)	Range (Weighted Average)
Impaired loans:
Commercial real estate	$	3,057	Sales comparison approach	Adj to comparables	0.0% - 90.0% (20.2%)
			Income approach	Capitalization rate	9.0% - 10.6% (10.1%)
			Cost approach	Accumulated depreciation	17.0% - 18.0% (17.8%)
Construction real estate	$	541	Sales comparison approach	Adj to comparables	0.0% - 11.1% (1.6%)
			Bulk sale approach	Discount rate	10.0% (10.0%)
Residential real estate	$	2,385	Sales comparison approach	Adj to comparables	0.3% - 110.0% (17.0%)
			Income approach	Capitalization rate	10.0% (10.0%)
Other real estate owned:
Commercial real estate	$	2,644	Sales comparison approach	Adj to comparables	0.0% - 68.4% (26.5%)
			Income approach	Capitalization rate	13.0% - 14.0% (13.1%)
Construction real estate	$	3,322	Sales comparison approach	Adj to comparables	0.0% - 90.0% (24.7%)
			Bulk sale approach	Discount rate	15.0% (15.0%)
Residential real estate	$	931	Sales comparison approach	Adj to comparables	3.2% - 79.7% (30.6%)

December 31, 2015
(In thousands)	Fair Value		Valuation Technique	Unobservable Input(s)	Range (Weighted Average)
Impaired loans:
Commercial real estate	$	3,698	Sales comparison approach	Adj to comparables	0.0% - 45.9% (20.3%)
			Income approach	Capitalization rate	7.0% - 13.3% (9.5%)
			Cost approach	Accumulated depreciation	50.0% (50.0%)
Construction real estate:
SEPH commercial land and development	$	2,044	Sales comparison approach	Adj to comparables	5.0% - 40.0% (22.1%)
			Bulk sale approach	Discount rate	10.7% (10.7%)
Remaining commercial	$	1,872	Sales comparison approach	Adj to comparables	0.0% - 25.3% (1.0%)
			Bulk sale approach	Discount rate	10.0% - 10.7% (10.0%)
Residential real estate	$	1,882	Sales comparison approach	Adj to comparables	0.0% - 96.7% (12.5%)
			Income approach	Capitalization rate	3.8% - 10.1% (9.1%)
			Cost approach	Accumulated depreciation	33.3% - 50.0% (43.4%)
Other real estate owned:
Commercial real estate	$	2,796	Sales comparison approach	Adj to comparables	2.0% - 71.0% (26.9%)
			Income approach	Capitalization rate	9.5% (9.5%)
Construction real estate	$	3,387	Sales comparison approach	Adj to comparables	0.0% - 85.0% (24.3%)
			Bulk sale approach	Discount rate	15.0% (15.0%)
Residential real estate	$	2,332	Sales comparison approach	Adj to comparables	0.1% - 61.8% (23.0%)

The following methods and assumptions were used by the Corporation in estimating its fair value disclosures for assets and liabilities not discussed above:

Cash and cash equivalents:The carrying amounts reported in the Consolidated BalanceSheets for cash and short-term instruments approximate those assets’ fair values.

Other investments: FHLB stock and FRB stock within other investments are carried at their respective redemption values as it is not practical to calculate their fair values. Additional investments within this category are carried at their cost basis as these investments do not have a readily determinable fair value and Park does not have the ability to influence the operating or financial decisions of the investee.

Loans receivable:For variable-rate loans that reprice frequently and with no significant change in credit risk, fair values are based on carrying values. The fair values for certain mortgage loans (e.g., one-to-four family residential) are based on quoted market prices of similar loans sold in conjunction with securitization transactions, adjusted for differences in loan characteristics. The fair values for other loans are estimated using discounted cash flow analyses, based upon interest rates currently being offered for loans with similar terms to borrowers of similar credit quality. The methods utilized to estimate fair value do not necessarily represent an exit price.

Off-balance sheet instruments:Fair values for the Corporation’s loan commitments and standby letters of credit are based on the fees currently charged to enter into similar agreements, taking into account the remaining terms of the agreements and the counterparties’ credit standing. The carrying amount and fair value are not material.

 Deposit liabilities:The fair values disclosed for demand deposits (e.g., interest and non-interest checking, savings, and money market accounts) are, by definition, equal to the amount payable on demand at the reporting date (i.e., their carrying amounts). The carrying amounts for variable-rate, fixed-term certificates of deposit approximate their fair values at the reporting date. Fair values for fixed-rate certificates of deposit are estimated using a discounted cash flow calculation that applies interest rates currently being offered on certificates to a schedule of aggregated expected monthly maturities of time deposits.

Short-term borrowings:The carrying amounts of federal funds purchased, borrowings under repurchase agreements and other short-term borrowings approximate their fair values.

Long-term debt:Fair values for long-term debt are estimated using a discounted cash flow calculation that applies interest rates currently being offered on long-term debt to a schedule of monthly maturities.

Subordinated notes:Fair values for subordinated notes are estimated using a discounted cash flow calculation that applies interest rate spreads currently being offered on similar debt structures to a schedule of monthly maturities.

The fair value of financial instruments at December 31, 2016 and December 31, 2015, was as follows:

	December 31, 2016
			Fair Value Measurements
(In thousands)	Carrying value		Level 1		Level 2		Level 3		Total fair value
Financial assets:
Cash and money market instruments	$	146,466	$	146,466	$	—	$	—	$	146,466
Investment securities	1,517,972		2,644		1,511,377		790		1,514,811
Accrued interest receivable - securities	3,849		—		3,849		—		3,849
Accrued interest receivable - loans	14,973		—		—		14,973		14,973
Mortgage loans held for sale	10,413		—		10,413		—		10,413
Impaired loans carried at fair value	5,983		—		—		5,983		5,983
Mortgage IRLCs	124		—		124		—		124
Other loans	5,204,713		—		—		5,161,919		5,161,919
Loans receivable, net	$	5,221,233	$	—	$	10,537	$	5,167,902	$	5,178,439
Financial liabilities:
Non-interest bearing checking accounts	$	1,523,417	$	1,523,417	$	—	$	—	$	1,523,417
Interest bearing transaction accounts	1,174,448		1,174,448		—		—		1,174,448
Savings accounts	1,704,920		1,704,920		—		—		1,704,920
Time deposits	1,117,870		—		1,122,598		—		1,122,598
Other	1,301		1,301		—		—		1,301
Total deposits	$	5,521,956	$	4,404,086	$	1,122,598	$	—	$	5,526,684
Short-term borrowings	$	394,795	$	—	$	394,795	$	—	$	394,795
Long-term debt	694,281		—		712,958		—		712,958
Subordinated notes	45,000		—		40,903		—		40,903
Accrued interest payable – deposits	900		82		818		—		900
Accrued interest payable – debt/borrowings	1,251		1		1,250		—		1,251
Derivative financial instruments:
Fair value swap	$	226	$	—	$	—	$	226	$	226

	December 31, 2015
			Fair Value Measurements
(In thousands)	Carrying value		Level 1		Level 2		Level 3		Total fair value
Financial assets:
Cash and money market instruments	$	149,459	$	149,459	$	—	$	—	$	149,459
Investment securities	1,585,568		1,941		1,584,984		769		1,587,694
Accrued interest receivable - securities	4,436		—		4,436		—		4,436
Accrued interest receivable - loans	14,239		—		—		14,239		14,239
Mortgage loans held for sale	7,306		—		7,306		—		7,306
Impaired loans carried at fair value	9,496		—		—		9,496		9,496
Mortgage IRLCs	165		—		165		—		165
Other loans	4,994,624		—		—		4,997,318		4,997,318
Loans receivable, net	$	5,011,591	$	—	$	7,471	$	5,006,814	$	5,014,285
Financial liabilities:
Non-interest bearing checking accounts	$	1,404,032	$	1,404,032	$	—	—		$	1,404,032
Interest bearing transaction accounts	1,107,200		1,107,200		—		—		1,107,200
Savings accounts	1,544,708		1,544,708		—		—		1,544,708
Time deposits	1,290,412		—		1,295,329		—		1,295,329
Other	1,290		1,290		—		—		1,290
Total deposits	$	5,347,642	$	4,057,230	$	1,295,329	$	—	$	5,352,559
Short-term borrowings	$	394,242	$	—	$	394,242	$	—	$	394,242
Long-term debt	738,105		—		771,420		—		771,420
Subordinated notes	45,000		—		41,596		—		41,596
Accrued interest payable – deposits	987		66		921		—		987
Accrued interest payable – debt/borrowings	1,351		4		1,347		—		1,351
Derivative financial instruments:
Fair value swap	$	226	$	—	$	—	$	226	$	226

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Capital Ratios

12 Months Ended

Dec. 31, 2016

Capital [Abstract]

Capital Ratios

Capital Ratios

Financial institution regulators have established guidelines for minimum capital ratios for banks, thrifts and bank holding companies. During the first quarter of 2015, Park adopted the Basel III regulatory capital framework as approved by the federal banking agencies. The adoption of this framework modified the calculation of the various capital ratios, added an additional ratio, common equity tier 1, and revised the adequately and well capitalized thresholds. Additionally, under this framework, in order to avoid limitations on capital distributions, including dividend payments, Park must hold a capital conservation buffer above the adequately capitalized risk-based capital ratios. The capital conservation buffer is being phased in from 0.0% for 2015 to 2.50% by 2019. The capital conservation buffer was 0.625% for 2016. The amounts shown below as the adequately capitalized ratio plus capital conservation buffer includes the fully phased-in 2.50% buffer.

PNB met each of the well-capitalized ratio guidelines at December 31, 2016. The following table indicates the capital ratios for PNB and Park at December 31, 2016 and 2015.

	As of December 31, 2016
	Leverage		Tier 1 Risk-Based		Common Equity Tier 1		Total Risk-Based
The Park National Bank	7.34	%	9.87	%	9.87	%	11.24	%
Park National Corporation	9.56	%	12.83	%	12.55	%	14.32	%
Adequately capitalized ratio	4.00	%	6.00	%	4.50	%	8.00	%
Adequately capitalized ratio plus capital conservation buffer	4.00	%	8.50	%	7.00	%	10.50	%
Well-capitalized ratio (PNB only)	5.00	%	8.00	%	6.50	%	10.00	%

	As of December 31, 2015
	Leverage		Tier 1 Risk-Based		Common Equity Tier 1		Total Risk-Based
The Park National Bank	7.06	%	9.83	%	9.83	%	11.37	%
Park National Corporation	9.22	%	12.82	%	12.54	%	14.49	%
Adequately capitalized ratio	4.00	%	6.00	%	4.50	%	8.00	%
Adequately capitalized ratio plus capital conservation buffer	4.00	%	8.50	%	7.00	%	10.50	%
Well-capitalized ratio (PNB only)	5.00	%	8.00	%	6.50	%	10.00	%

Failure to meet the minimum requirements above could cause the FRB to take action. PNB is also subject to the capital requirements of its primary regulator, the OCC. As of December 31, 2016 and 2015, Park and PNB were well-capitalized and met all capital requirements to which each was then subject. There are no conditions or events since PNB's most recent regulatory report filings, that management believes have changed the risk categories for PNB.

The following table reflects various measures of capital for Park and PNB:

					To Be Adequately Capitalized				To Be Well Capitalized
(In thousands)	Actual Amount		Ratio		Amount		Ratio		Amount		Ratio
At December 31, 2016
Total Risk-Based Capital (to risk-weighted assets)
PNB	$	607,269	11.24	%	$	432,153	8.00	%	$	540,192	10.00	%
Park	784,406		14.32	%	438,231		8.00	%	N/A		N/A
Tier 1 Risk-Based Capital (to risk-weighted assets)
PNB	$	533,215	9.87	%	$	324,115	6.00	%	$	432,153	8.00	%
Park	702,651		12.83	%	328,673		6.00	%	N/A		N/A
Leverage Ratio (to average total assets)
PNB	$	533,215	7.34	%	$	290,671	4.00	%	$	363,339	5.00	%
Park	702,651		9.56	%	293,916		4.00	%	N/A		N/A
Common Equity Tier 1 (to risk-weighted assets)
PNB	$	533,215	9.87	%	$	243,086	4.50	%	$	351,125	6.50	%
Park	687,651		12.55	%	246,505		4.50	%	N/A		N/A
At December 31, 2015
Total Risk-Based Capital (to risk-weighted assets)
PNB	$	588,467	11.37	%	$	414,079	8.00	%	$	517,599	10.00	%
Park	758,988		14.49	%	419,080		8.00	%	N/A		N/A
Tier 1 Risk-Based Capital (to risk-weighted assets)
PNB	$	508,763	9.83	%	$	310,560	6.00	%	$	414,079	8.00	%
Park	671,664		12.82	%	314,310		6.00	%	N/A		N/A
Leverage Ratio (to average total assets)
PNB	$	508,763	7.06	%	$	288,147	4.00	%	$	360,183	5.00	%
Park	671,664		9.22	%	291,449		4.00	%	N/A		N/A
Common Equity Tier 1 (to risk-weighted assets)
PNB	508,763		9.83	%	232,920		4.50	%	336,439		6.50	%
Park	656,664		12.54	%	235,732		4.50	%	N/A		N/A

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Segment Information

12 Months Ended

Dec. 31, 2016

Segment Reporting [Abstract]

Segment Information

Segment Information

The Corporation is a financial holding company headquartered in Newark, Ohio. The operating segments for the Corporation are its chartered national bank subsidiary, PNB (headquartered in Newark, Ohio), SEPH and GFSC.

GAAP requires management to disclose information about the different types of business activities in which a company engages and also information on the different economic environments in which a company operates, so that the users of the financial statements can better understand a company’s performance, better understand the potential for future cash flows, and make more informed judgments about the company as a whole. Park’s current operating segments are in line with GAAP as: (i) discrete financial information is available for each operating segment and (ii) the segments are aligned with internal reporting to Park’s Chief Executive Officer and President, who is the chief operating decision-maker.  

Operating results for the year ended December 31, 2016 (In thousands)
	PNB		GFSC			SEPH			All Other			Total
Net interest income (loss)	$	227,576	$	5,874		$	4,774		$	(138	)	$	238,086
Provision for (recovery of) loan losses	2,611		1,887			(9,599		)	—			(5,101		)
Other income (loss)	74,803		(1		)	2,974			955			78,731
Other expense	177,562		4,457			7,273			9,731			199,023
Income (loss) before taxes	122,206		(471		)	10,074			(8,914		)	122,895
Income taxes (benefit)	37,755		(164		)	3,526			(4,357		)	36,760
Net income (loss)	$	84,451	$	(307	)	$	6,548		$	(4,557	)	$	86,135
Balances at December 31, 2016
Assets	$	7,389,538	$	32,268		$	25,342		$	20,438		$	7,467,586
Loans	5,234,828		32,661			12,354			(7,986		)	5,271,857
Deposits	5,630,199		3,809			—			(112,052		)	5,521,956

Operating results for the year ended December 31, 2015 (In thousands)
	PNB		GFSC		SEPH			All Other			Total
Net interest income (loss)	$	220,879	$	6,588	$	(74	)	$	239		$	227,632
Provision for (recovery of) loan losses	7,665		1,415		(4,090		)	—			4,990
Other income	75,188		2		1,848			513			77,551
Other expense	167,476		2,984		6,182			9,972			186,614
Income (loss) before taxes	120,926		2,191		(318		)	(9,220		)	113,579
Income taxes (benefit)	36,581		768		(111		)	(4,671		)	32,567
Net income (loss)	$	84,345	$	1,423	$	(207	)	$	(4,549	)	$	81,012
Balances at December 31, 2015
Assets	$	7,229,764	$	35,793	$	33,541		$	12,256		$	7,311,354
Loans	5,029,072		35,469		15,153			(11,609		)	5,068,085
Deposits	5,447,293		4,627		—			(104,278		)	5,347,642

Operating results for the year ended December 31, 2014 (In thousands)
	PNB		GFSC			SEPH			All Other			Total
Net interest income (loss)	$	218,641	$	7,457		$	958		$	(2,012	)	$	225,044
Provision for (recovery of) loan losses	3,517		1,544			(12,394		)	—			(7,333		)
Other income (loss)	69,384		(1		)	5,991			175			75,549
Other expense	163,641		4,103			11,766			8,000			187,510
Income (loss) before taxes	120,867		1,809			7,577			(9,837		)	120,416
Income taxes (benefit)	37,960		634			2,652			(4,787		)	36,459
Net income (loss)	$	82,907	$	1,175		$	4,925		$	(5,050	)	$	83,957
Balances at December 31, 2014
Assets	$	6,910,386	$	40,308		$	43,762		$	6,743		$	7,001,199
Loans	4,781,761		40,645			23,956			(16,680		)	4,829,682
Deposits	5,222,766		5,883			—			(100,649		)	5,128,000

The following is a reconciliation of financial information for the reportable segments to the Corporation’s consolidated totals:

	2016
(In thousands)	Net Interest Income			Depreciation Expense		Other Expense		Income Taxes			Assets			Deposits
Totals for reportable segments	$	238,224		$	8,396	$	180,896	$	41,117		$	7,447,148		$	5,634,008
Elimination of intersegment items	2,164			—		—		—			(9,204		)	(112,052		)
Parent Co. totals - not eliminated	(2,302		)	—		9,731		(4,357		)	29,642			—
Totals	$	238,086		$	8,396	$	190,627	$	36,760		$	7,467,586		$	5,521,956

	2015
(In thousands)	Net Interest Income			Depreciation Expense		Other Expense		Income Taxes			Assets			Deposits
Totals for reportable segments	$	227,393		$	7,347	$	169,295	$	37,238		$	7,299,098		$	5,451,920
Elimination of intersegment items	2,561			—		—		—			(13,557		)	(104,278		)
Parent Co. totals - not eliminated	(2,322		)	—		9,972		(4,671		)	25,813			—
Totals	$	227,632		$	7,347	$	179,267	$	32,567		$	7,311,354		$	5,347,642

	2014
(In thousands)	Net Interest Income			Depreciation Expense		Other Expense		Income Taxes			Assets			Deposits
Totals for reportable segments	$	227,056		$	7,243	$	172,267	$	41,246		$	6,994,456		$	5,228,649
Elimination of intersegment items	3,708			—		—		—			(18,556		)	(100,649		)
Parent Co. totals - not eliminated	(5,720		)	—		8,000		(4,787		)	25,299			—
Totals	$	225,044		$	7,243	$	180,267	$	36,459		$	7,001,199		$	5,128,000

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Parent Company Statements

12 Months Ended

Dec. 31, 2016

Condensed Financial Information of Parent Company Only Disclosure [Abstract]

Parent Company Statements

Parent Company Statements

The Parent Company statements should be read in conjunction with the consolidated financial statements and the information set forth below. Investments in subsidiaries are accounted for using the equity method of accounting.

Cash represents non-interest bearing deposits with PNB. Net cash provided by operating activities reflects cash payments (received from subsidiaries) for income taxes of $4.4 million, $4.1 million and $5.8 million in 2016, 2015 and 2014, respectively.

At December 31, 2016 and 2015, shareholders’ equity reflected in the Parent Company balance sheet includes $259.7 million and $199.4 million, respectively, of undistributed earnings of the Corporation’s subsidiaries which are restricted from transfer as dividends to the Corporation.

Balance Sheets
December 31, 2016 and 2015
(In thousands)	2016		2015
Assets:
Cash	$	112,067	$	102,416
Investment in subsidiaries	626,569		613,383
Debentures receivable from PNB	25,000		25,000
Other investments	2,962		2,341
Other assets	26,651		23,443
Total assets	$	793,249	$	766,583
Liabilities:
Subordinated notes	45,000		45,000
Other liabilities	6,009		8,228
Total liabilities	51,009		53,228
Total shareholders’ equity	742,240		713,355
Total liabilities and shareholders’ equity	$	793,249	$	766,583

Statements of Income
for the years ended December 31, 2016, 2015 and 2014
(In thousands)	2016			2015			2014
Income:
Dividends from subsidiaries	$	60,000		$	60,000		$	60,000
Interest and dividends	2,164			2,561			3,708
Other	1,081			560			262
Total income	63,245			63,121			63,970
Expense:
Other, net	12,159			12,341			13,807
Total expense	12,159			12,341			13,807
Income before federal taxes and equity in undistributed income of subsidiaries	51,086			50,780			50,163
Federal income tax benefit	4,357			4,671			4,787
Income before equity in undistributed income of subsidiaries	55,443			55,451			54,950
Equity in undistributed income of subsidiaries	30,692			25,561			29,007
Net income	$	86,135		$	81,012		$	83,957
Other comprehensive (loss) income (1)	(2,102		)	(2,035		)	21,811
Comprehensive income	84,033			78,977			105,768

(1) See Consolidated Statements of Comprehensive Income for other comprehensive (loss) income detail

Statements of Cash Flows
for the years ended December 31, 2016, 2015 and 2014
(In thousands)	2016			2015			2014
Operating activities:
Net income	$	86,135		$	81,012		$	83,957
Adjustments to reconcile net income to net cash provided by operating activities:
Undistributed income of subsidiaries	(30,692		)	(25,561		)	(29,007		)
Compensation expense for issuance of treasury stock to directors	950			963			801
Share-based compensation expense	1,864			865			458
Increase in other assets	(3,425		)	(182		)	(1,292		)
(Decrease) increase in other liabilities	(2,524		)	485			298
Net cash provided by operating activities	52,308			57,582			55,215
Investing activities:
Repayment of investments in and advances to subsidiaries	15,000			10,000			32,000
Net cash provided by investing activities	15,000			10,000			32,000
Financing activities:
Cash dividends paid	(57,653		)	(57,776		)	(57,876		)
Repayment of subordinated notes	—			—			(35,250		)
Repurchase of treasury shares	—			(6,058		)	(2,355		)
Cash payment for fractional shares	(4		)	(3		)	(5		)
Net cash used in financing activities	(57,657		)	(63,837		)	(95,486		)
Increase (decrease) in cash	9,651			3,745			(8,271		)
Cash at beginning of year	102,416			98,671			106,942
Cash at end of year	$	112,067		$	102,416		$	98,671

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Summary of Significant Accounting Policies (Policies)

12 Months Ended

Dec. 31, 2016

Accounting Policies [Abstract]

Principles of Consolidation

Principles of Consolidation

The consolidated financial statements include the accounts of Park National Corporation and its subsidiaries (“Park”, the “Company” or the “Corporation”). Material intercompany accounts and transactions have been eliminated.

Use of Estimates

Use of Estimates

The preparation of financial statements in conformity with U.S. generally accepted accounting principles ("GAAP") requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could differ from those estimates.

Reclassifications

Reclassifications

Certain prior year amounts have been reclassified to conform with the current year presentation. These reclassifications had no impact on net income or shareholders' equity.

Restrictions on Cash and Due from Banks

Restrictions on Cash and Due from Banks

The Corporation’s national bank subsidiary is required to maintain average reserve balances with the Federal Reserve Bank. The average required reserve balance was approximately $51.6 million at December 31, 2016 and $44.2 million at December 31, 2015. No other compensating balance arrangements were in existence at December 31, 2016.

Investment Securities

Investment Securities

Investment securities are classified upon acquisition into one of three categories: held-to-maturity ("HTM"), available-for-sale ("AFS"), or trading (see Note 4 - Investment Securities).

HTM securities are those securities that the Corporation has the positive intent and ability to hold to maturity and are recorded at amortized cost. AFS securities are those securities that would be available to be sold in the future in response to the Corporation’s liquidity needs, changes in market interest rates, and asset-liability management strategies, among other reasons. AFS securities are reported at fair value, with unrealized holding gains and losses excluded from earnings but included in other comprehensive income (loss), net of applicable income taxes. The Corporation did not hold any trading securities during any period presented.

AFS and HTM securities are evaluated quarterly for potential other-than-temporary impairment. Management considers the facts related to each security including the nature of the security, the amount and duration of the loss, the credit quality of the issuer, the expectations for that security’s performance and whether Park intends to sell, or it is more likely than not that Park will be required to sell, a security in an unrealized loss position before recovery of its amortized cost basis. Declines in the value of equity securities that are considered to be other-than-temporary are recorded as a charge to earnings in the Consolidated Statements of Income. Declines in the value of debt securities that are considered to be other-than-temporary are separated into (1) the amount of the total impairment related to credit loss and (2) the amount of the total impairment related to all other factors. The amount of the total other-than-temporary impairment related to the credit loss is recognized in earnings. The amount of the total other-than-temporary impairment related to all other factors is recognized in other comprehensive income (loss), net of income tax.

Interest income from investment securities includes amortization of purchase premium or discount. Premiums and discounts on securities are amortized on the level-yield method without anticipating prepayments, except for mortgage-backed securities where prepayments are anticipated.

Gains and losses realized on the sale of investment securities are recorded on the trade date and determined using the specific identification basis.

Federal Home Loan Bank (FHLB) and Federal Reserve Bank (FRB) Stock

Federal Home Loan Bank ("FHLB") and Federal Reserve Bank ("FRB") Stock

Park’s national bank subsidiary, The Park National Bank ("PNB"), is a member of the FHLB. Additionally, PNB is a member of the FRB. Members are required to own a certain amount of stock based on their level of borrowings and other factors and may invest in additional amounts. FHLB stock and FRB stock are classified as restricted securities and are carried at their redemption value within other investment securities on the Consolidated Balance Sheets. Impairment is evaluated based on the ultimate recovery of par value. Both cash and stock dividends are reported as income.

Bank Owned Life Insurance

Bank Owned Life Insurance

Park has purchased insurance policies on the lives of directors and certain key officers. Bank owned life insurance is recorded at its cash surrender value (or the amount that can be realized).

Mortgage Loans Held For Sale

Loans Held for Sale

Generally, loans held for sale are carried at the lower of cost or fair value. Park has elected the fair value option for mortgage loans held for sale, which are carried at their fair value as of each balance sheet date.

Mortgage Banking Derivatives

Mortgage Banking Derivatives

Commitments to fund mortgage loans (interest rate locks) to be sold into the secondary market and forward commitments for the future delivery of these mortgage loans are accounted for as free standing derivatives. The fair values of these mortgage derivatives are estimated based on changes in mortgage interest rates from the date the interest rate on the loan is locked. The Company enters into forward commitments for the future delivery of mortgage loans when interest rate locks are entered into, in order to hedge the change in interest rates resulting from its commitments to fund the loans. Changes in the fair values of these derivatives are included in net gains on sale of loans.

Loans

Loans

Loans that management has the intent and ability to hold for the foreseeable future or until maturity or payoff, are reported at their outstanding principal balances adjusted for any charge-offs, any deferred fees or costs on originated loans, and any unamortized premiums or discounts on purchased loans. Interest income is accrued on the unpaid principal balance. Net deferred loan origination fees and costs are deferred and recognized in interest income using the level-yield method without anticipating prepayments.

Commercial loans include: (1) commercial, financial and agricultural loans; (2) commercial real estate loans; (3) those commercial loans in the real estate construction loan segment; and (4) those commercial loans in the residential real estate loan segment. Consumer loans include: (1) mortgage and installment loans included in the real estate construction segment; (2) mortgage, home equity lines of credit ("HELOCs"), and installment loans included in the residential real estate segment; and (3) all loans included in the consumer segment.

Generally, commercial loans are placed on nonaccrual status at 90 days past due and consumer and residential mortgage loans are placed on nonaccrual status at 120 days past due. Commercial loans placed on nonaccrual status are considered impaired (see Note 5 - Loans). For loans which are on nonaccrual status, it is Park’s policy to reverse interest previously accrued on the loans against interest income. Interest on such loans may be recorded on a cash basis and be included in earnings only when Park expects to receive the entire recorded investment of the loan. Park’s charge-off policy for commercial loans requires management to establish a specific reserve or record a charge-off as soon as it is apparent that the borrower is troubled and there is, or likely will be, a collateral shortfall related to the estimated value of the collateral securing the loan. The Company’s charge-off policy for consumer loans is dependent on the class of the loan. Residential mortgage loans, HELOCs, and consumer loans secured by residential real estate are typically charged down to the value of the collateral, less estimated selling costs, at 180 days past due. The charge-off policy for other consumer loans, primarily installment loans, requires a monthly review of delinquent loans and a complete charge-off for any account that reaches 120 days past due.

The delinquency status of a loan is based on contractual terms and not on how recently payments have been received. Loans may be removed from nonaccrual status when loan payments have been received to cure the delinquency status, the borrower has demonstrated the ability to maintain current payment status in accordance with the loan agreement and the loan is deemed to be well-secured by management.

A description of each segment of the loan portfolio, along with the risk characteristics of each segment, is included below:

Commercial, financial and agricultural:Commercial, financial and agricultural loans are made for a wide variety of general corporate purposes, including financing for commercial and industrial businesses, financing for equipment, inventories and accounts receivable, acquisition financing and commercial leasing. The term of each commercial loan varies by its purpose. Repayment terms are structured such that commercial loans will be repaid within the economic useful life of the underlying asset. The commercial loan portfolio includes loans to a wide variety of corporations and businesses across many industrial classifications originated in the 28 Ohio counties where PNB operates. The primary industries represented by these customers include manufacturing, retail trade, health care and other services.

Commercial real estate:Commercial real estate (“CRE”) loans include mortgage loans to developers and owners of commercial real estate. The lending policy for CRE loans is designed to address the unique risk attributes of CRE lending. The collateral for these CRE loans is the underlying commercial real estate.

Construction real estate: The Company defines construction loans as both commercial construction loans and residential construction loans where the loan proceeds are used exclusively for the improvement of real estate as to which the Company holds a mortgage. Construction loans may be in the form of a permanent loan or short-term construction loan, depending on the needs of the individual borrower. Construction financing is generally considered to involve a higher degree of risk of loss than long-term financing on improved, occupied real estate. Risk of loss on a construction loan depends largely upon the accuracy of the initial estimate of the property’s value at completion of construction and the estimated cost (including interest) of construction. If the estimate of construction cost proves to be inaccurate, the PNB division making the loan may be required to advance funds beyond the amount originally committed to permit completion of the project. If the estimate of value proves inaccurate, the PNB division may be confronted, at or prior to the maturity of the loan, with a project having a value insufficient to assure full repayment, should the borrower default. In the event that a default on a construction loan occurs and foreclosure follows, the PNB division must take control of the project and attempt to either arrange for completion of construction or dispose of the unfinished project. Additional risk exists with respect to loans made to developers who do not have a buyer for the property, as the developer may lack funds to pay the loan if the property is not sold upon completion. PNB and its divisions attempt to reduce such risks on loans to developers by requiring personal guarantees and reviewing current personal financial statements and tax returns as well as other projects undertaken by the developer.

Residential real estate:The Company defines residential real estate loans as first mortgages on individuals’ primary residences or second mortgages of individuals’ primary residences in the form of HELOCs or installment loans. Credit approval for residential real estate loans requires demonstration of sufficient income to repay the principal and interest and the real estate taxes and insurance, stability of employment, an established credit record and an appraised value of the real estate securing the loan.

Consumer:The Company originates direct and indirect consumer loans, primarily automobile loans, to customers in its primary market areas. Credit approval for consumer loans requires income sufficient to repay principal and interest due, stability of employment, an established credit record and sufficient collateral for secured loans. Consumer loans typically have shorter terms and lower balances with higher yields as compared to real estate mortgage loans, but generally carry higher risks of default. Consumer loan collections are dependent on the borrower’s financial stability, and thus are more likely to be affected by adverse personal circumstances.

Allowance for Loan Losses

Allowance for Loan Losses ("ALLL")

The allowance for loan losses is that amount believed adequate to absorb probable incurred credit losses in the loan portfolio based on management’s evaluation of various factors. The determination of the allowance requires significant estimates, including the timing and amounts of expected cash flows on impaired loans, consideration of current economic conditions, and historical loss experience pertaining to pools of homogeneous loans, all of which may be susceptible to change. The allowance is increased through a provision for loan losses that is charged to earnings based on management’s quarterly evaluation of the factors previously mentioned and is reduced by charge-offs, net of recoveries.

The allowance for loan losses includes both (1) an estimate of loss based on historical loss experience within both commercial and consumer loan categories with similar characteristics (“statistical allocation”) and (2) an estimate of loss based on an impairment analysis of each commercial loan that is considered to be impaired (“specific allocation”). Included in the statistical allocation is a reserve for troubled debt restructurings ("TDRs") within the consumer loan portfolio. Management performs a periodic evaluation to ensure the reserve calculated utilizing the statistical allocation is consistent with a reserve calculated under Accounting Standards Codification ("ASC") 310-10- Receivables.

In calculating the allowance for loan losses, management believes it is appropriate to consider historical loss rates that are comparable to the current period being analyzed, giving consideration to losses experienced over a full cycle. For the historical loss factor at December 31, 2016, the Company utilized an annual loss rate (“historical loss experience”), calculated based on an average of the net charge-offs and the annual change in specific reserves for impaired commercial loans, experienced during 2010 through 2016 within the individual segments of the commercial and consumer loan categories. Management believes the 84-month historical loss experience methodology is appropriate in the current economic environment, as it captures loss rates consistent with current expectations based on current economic conditions.

The loss factor applied to Park’s consumer loan portfolio as of December 31, 2016 was based on the historical loss experience over the past 84 months, plus an additional judgmental reserve, increasing the total allowance for loan loss coverage in the consumer loan portfolio to approximately 1.95 years of historical losses. The consumer loan portfolio loss coverage ratio was 1.99 years at December 31, 2015. Historical loss experience over the past 84 months for the consumer loan portfolio was 0.34% for 2016 and 0.42% for 2015.

The loss factor applied to Park’s commercial loan portfolio as of December 31, 2016 was based on the historical loss experience over the past 84 months, plus additional reserves for consideration of (1) a loss emergence period factor, (2) a loss migration factor and (3) a judgmental or environmental loss factor. These additional reserves increased the total allowance for loan loss coverage in the commercial loan portfolio to approximately 3.20 years of historical losses at December 31, 2016. The commercial loan portfolio loss coverage ratio was 2.37 years at December 31, 2015. Historical loss experience over the past 84 months for the commercial loan portfolio was 0.39% for 2016 and 0.53% for 2015. Park’s commercial loans are individually risk graded. If loan downgrades occur, the probability of default increases and accordingly management allocates a higher percentage reserve to those accruing commercial loans graded special mention and substandard.

The judgmental increases discussed above incorporate management’s evaluation of the impact of environmental qualitative factors which pose additional risks and assign a component of the allowance for loan losses in consideration of these factors. Such environmental factors include: national and local economic trends and conditions; experience, ability and depth of lending management and staff; effects of any changes in lending policies and procedures; and levels of, and trends in, consumer bankruptcies, delinquencies, impaired loans and charge-offs and recoveries.

GAAP requires a specific allocation to be established as a component of the allowance for loan losses for certain loans when it is probable that all amounts due pursuant to the contractual terms of the loans will not be collected, and the recorded investment in the loans exceeds their measure of impairment. Management considers the following related to commercial loans when determining if a loan should be considered impaired: (1) current debt service coverage levels of the borrowing entity; (2) payment history over the most recent 12-month period; (3) other signs of deterioration in the borrower’s financial situation, such as changes in credit scores; and (4) consideration of global cash flows of financially sound guarantors that have previously supported loan payments. The recorded investment is the carrying balance of the loan, plus accrued interest receivable, both as of the end of the year. Impairment is measured using either the present value of expected future cash flows based upon the initial effective interest rate on the loan, or the fair value of the collateral. If a loan is considered to be collateral dependent, the fair value of collateral, less estimated selling costs, is used to measure impairment.

Troubled Debt Restructuring (TDRs)

Troubled Debt Restructuring

Management classifies loans as TDRs when a borrower is experiencing financial difficulty and Park has granted a concession. In order to determine whether a borrower is experiencing financial difficulty, an evaluation is performed of the probability that the borrower will be in payment default on any of the borrower's debt in the foreseeable future without the modification. This evaluation is performed under the Company’s internal underwriting policy. Management’s policy is to modify loans by extending the term or by granting a temporary or permanent contractual interest rate below the market rate, not by forgiving debt. A court's discharge of a borrower's debt in a Chapter 7 bankruptcy is considered a concession when the borrower does not reaffirm the discharged debt. TDRs are separately identified for impairment disclosures and are measured at the present value of estimated future cash flows using the loan’s effective rate at inception. If a TDR is considered to be a collateral dependent loan, the loan is reported, net, at the fair value of the collateral.

Income Recognition

Income Recognition

Income earned by the Corporation and its subsidiaries is recognized on the accrual basis of accounting, except for nonaccrual loans as previously discussed, and late charges on loans which are recognized as income when they are collected.

Premises and Equipment

Premises and Equipment

Land is carried at cost and is not subject to depreciation. Premises and equipment are carried at cost, less accumulated depreciation and amortization. Depreciation is generally provided on the straight-line method over the estimated useful lives of the related assets. Leasehold improvements are amortized over the shorter of the remaining lease period or the estimated useful lives of the improvements. Upon the sale or other disposal of an asset, the cost and related accumulated depreciation are removed from the accounts and the resulting gain or loss is recognized. Maintenance and repairs are charged to expense as incurred while renewals and improvements that extend the useful life of an asset are capitalized. Premises and equipment are evaluated for impairment whenever events or changes in circumstances indicate that the carrying amount of a particular asset may not be recoverable.

The range of depreciable lives over which premises and equipment are being depreciated are:

Buildings	30 Years
Equipment, furniture and fixtures	3 to 12 Years
Leasehold improvements	1 to 10 Years

Other Real Estate Owned (OREO)

Other Real Estate Owned ("OREO")

Management transfers a loan to OREO at the time that Park takes deed/title of the asset. OREO is initially recorded at fair value less anticipated selling costs (net realizable value), establishing a new cost basis, and consists of property acquired through foreclosure and real estate held for sale. If the net realizable value is below the carrying value of the loan at the date of transfer, the difference is charged to the allowance for loan losses. These assets are subsequently accounted for at the lower of cost or fair value less costs to sell. Subsequent changes in the value of real estate are classified as OREO valuation adjustments, are reported as adjustments to the carrying amount of OREO and are recorded within “Other income”. In certain circumstances where management believes the devaluation may not be permanent in nature, Park utilizes a valuation allowance to record OREO devaluations, which is also expensed through “Other income”. Costs relating to development and improvement of such properties are capitalized (not in excess of fair value less estimated costs to sell) and costs relating to holding the properties are charged to "Other expense".

Mortgage Loan Servicing Rights

Mortgage Servicing Rights ("MSR")

When Park sells mortgage loans with servicing rights retained, servicing rights are recorded at an amount not to exceed fair value with the income statement effect recorded in "Other service income." Capitalized servicing rights are amortized in proportion to and over the period of the estimated future servicing income of the underlying loan and are included within “Other service income”.

Mortgage servicing rights are assessed for impairment periodically, based on fair value, with any impairment recognized through a valuation allowance. The fair value of mortgage servicing rights is determined by discounting estimated future cash flows from the servicing assets, using market discount rates and expected future prepayment rates. In order to calculate fair value, the sold loan portfolio is stratified into homogeneous pools of like categories. (See Note 24 - Loan Servicing.)

Fees received for servicing mortgage loans owned by investors are based on a percentage of the outstanding monthly principal balance of such loans and are included in income as loan payments are received. The cost of servicing loans is charged to expense as incurred.

Goodwill and Other Intangible Assets

Goodwill

Goodwill represents the excess of the purchase price over net identifiable tangible and intangible assets acquired in a purchase business combination. Goodwill and indefinite-lived intangible assets are not amortized to expense, but are subject to impairment tests annually, or more frequently, if events or changes in circumstances indicate that the asset might be impaired, by assessing qualitative factors to determine whether the existence of events or circumstances leads to a determination that it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If after assessing these events or circumstances, it is concluded that it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, then performing the two-step impairment test is unnecessary. If the carrying amount of the goodwill exceeds the fair value, an impairment charge must be recorded in an amount equal to the excess.

Management considers several factors when performing the annual impairment tests on goodwill. The factors considered include the operating results for the particular Park segment for the past year and the operating results budgeted for the current year (including multi-year projections), the deposit and loan totals of the Park segment and the economic conditions in the markets served by the Park segment. At December 31, 2016, the goodwill remaining on Park's Consolidated Balance Sheet consisted entirely of goodwill at PNB. (See Note 27 - Segment Information for operating segment results.)

Park evaluates goodwill for impairment on April 1 of each year, with financial data as of March 31. Based on the analysis performed as of April 1, 2016, the Company determined that goodwill for Park’s national bank subsidiary (PNB) was not impaired. There have been no subsequent circumstances or events triggering an additional evaluation.

Goodwill in the amount of $72.3 million was recorded at each of December 31, 2016, 2015, and 2014.

Consolidated Statement of Cash Flows

Consolidated Statement of Cash Flows

Cash and cash equivalents include cash and cash items, amounts due from banks and money market instruments. Generally, money market instruments are purchased and sold for one-day periods.

Loss Contingencies and Guarantees

Loss Contingencies and Guarantees

Loss contingencies, including claims and legal actions arising in the ordinary course of business, are recorded as liabilities when the likelihood of loss is probable and an amount or range of loss can be reasonably estimated.

Income Tax, Policy [Policy Text Block]

Income Taxes

The Corporation accounts for income taxes using the asset and liability approach. Under this method, deferred tax assets and liabilities are determined based on differences between financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. To the extent that Park does not consider it more likely than not that a deferred tax asset will be recovered, a valuation allowance is recorded. All positive and negative evidence is reviewed when determining how much of a valuation allowance is recognized on a quarterly basis. A valuation allowance, if needed, reduces deferred tax assets to the amount expected to be realized.

An uncertain tax position is recognized as a benefit only if it is “more-likely-than-not” that the tax position would be sustained in a tax examination being presumed to occur. The benefit recognized for a tax position that meets the “more-likely-than-not” criteria is measured based on the largest benefit that is more than 50 percent likely to be realized, taking into consideration the amounts and probabilities of the outcome upon settlement. For tax positions not meeting the “more-likely-than-not” test, no tax benefit is recorded. Park recognizes any interest and penalties related to income tax matters in income tax expense.

Treasury Shares

Treasury Shares

The purchase of Park’s common shares to be held in treasury is recorded at cost. At the date of retirement or subsequent reissuance, the treasury shares account is reduced by the weighted average cost of the common shares retired or reissued.

Comprehensive Income

Comprehensive Income

Comprehensive income consists of net income and other comprehensive income (loss). Other comprehensive income (loss) includes unrealized gains and losses on securities available for sale, and changes in the funded status of the Company’s defined benefit pension plan, which are also recognized as separate components of equity.

Stock Based Compensation

Share-Based Compensation

Compensation cost is recognized for restricted stock units and stock awards issued to employees and directors, respectively, based on the fair value of these awards at the date of grant. The market price of Park’s common shares at the date of grant is used to estimate the fair value of restricted stock units and stock awards. Compensation cost is recognized over the required service period, generally defined as the vesting period and is recorded in "Salaries" expense. (See Note 17-Share-Based Compensation.)

Loan Commitments and Related Financial Instruments

Loan Commitments and Related Financial Instruments

Financial instruments include off‑balance sheet credit instruments, such as commitments to make loans and commercial letters of credit, issued to meet customer financing needs. The face amount for these items represents the exposure to loss, before considering customer collateral or ability to repay. Such financial instruments are recorded when they are funded.

Fair Value Measurement

Fair Value Measurement

Fair values of financial instruments are estimated using relevant market information and other assumptions, as more fully disclosed in Note 25 - Fair Value. Fair value estimates involve uncertainties and matters of significant judgment regarding interest rates, credit risk, prepayments, and other factors, especially in the absence of broad markets for particular items. Changes in assumptions or in market conditions could significantly affect the estimates.

Transfers and Financial Assets

Transfers of Financial Assets

Transfers of financial assets are accounted for as sales, when control over the assets has been relinquished. Control over transferred assets is deemed to be surrendered when the assets have been isolated from the Company, the transferee obtains the right (free of conditions that constrain it from taking advantage of that right) to pledge or exchange the transferred assets, and the Company does not maintain effective control over the transferred assets through an agreement to repurchase them before their maturity.

Retirement Plans

Retirement Plans

Pension expense is the net of service and interest cost, return on plan assets and amortization of gains and losses not immediately recognized. Employee KSOP plan expense is the amount of matching contributions to Park's employees stock ownership plan. Deferred compensation and supplemental retirement plan expense allocates the benefits over years of service. (See Note 18 - Benefit Plans.)

Earnings Per Common Share

Earnings Per Common Share

Basic earnings per common share is net income available to common shareholders divided by the weighted average number of common shares outstanding during the period. Diluted earnings per common share includes the dilutive effect of additional potential common shares issuable under stock awards, stock options, warrants and convertible securities. Earnings and dividends per common share are restated for any stock splits and stock dividends through the date of issuance of the consolidated financial statements. (See Note 21 - Earnings Per Common Share.)

Segment Reporting, Policy [Policy Text Block]

Operating Segments

The Corporation is a financial holding company headquartered in Newark, Ohio. The operating segments for the Corporation are its chartered national bank subsidiary, PNB (headquartered in Newark, Ohio), SE Property Holdings, LLC ("SEPH"), and Guardian Financial Services Company ("GFSC").

Adoption of New Accounting Pronouncements

Adoption of New Accounting Pronouncements and Issued Not Yet Effective Accounting Standards

ASU 2014-09 - Revenue from Contracts with Customers (Topic 606): In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606). The ASU creates a new topic, Topic 606, to provide guidance on revenue recognition for entities that enter into contracts with customers to transfer goods or services or enter into contracts for the transfer of nonfinancial assets. The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. Additional disclosures are required to provide quantitative and qualitative information regarding the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The new guidance is effective for annual reporting periods, and interim reporting periods within those annual periods, beginning after December 15, 2017. While interest income is specifically out of scope of this standard, management is currently evaluating the revenue streams within "Other income" to assess the applicability of this standard. Specifically, management is evaluating the impact of this new guidance on deposit fees recorded within "Service Charges on Deposit Accounts" and trust income within "Income from Fiduciary Activities."

ASU 2015-02 - Consolidation (Topic 810): Amendments to the Consolidation Analysis: In February 2015, the FASB issued ASU 2015-02, Consolidation (Topic 810): Amendments to the Consolidation Analysis. The ASU amends the current consolidation guidance and affect both the variable interest entity and voting interest entity consolidation models. The new guidance is effective for annual reporting periods and interim reporting periods within those annual periods, beginning after December 15, 2015. The adoption of this guidance on January 1, 2016 did not have an impact on Park’s consolidated financial statements.

ASU 2016-01 - Financial Instruments - Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities. In January 2016, the FASB issued ASU 2016-01 - Financial Instruments - Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities. Changes to the current U.S. GAAP model primarily affect the accounting for equity investments, financial liabilities under the fair value option, and the presentation and disclosure requirements for financial instruments. In addition, the ASU clarifies guidance related to the valuation allowance assessment when recognizing deferred tax assets resulting from unrealized losses on available-for-sale securities. The new guidance is effective for annual reporting periods and interim reporting periods within those annual periods, beginning after December 15, 2017. The adoption of this guidance is not expected to have a material impact on Park's consolidated financial statements.

ASU 2016-02 - Leases (Topic 842): In February 2016, the FASB issued ASU 2016-02 - Leases (Topic 842). The ASU will require all organizations that lease assets to recognize on the balance sheet the assets and liabilities for the rights and obligations created by those leases. Additional qualitative and quantitative disclosures will be required so that users can understand more about the nature of an entity’s leasing activities. The new guidance is effective for annual reporting periods and interim reporting periods within those annual periods, beginning after December 15, 2018. Early adoption is permitted. Management is currently analyzing data on leased assets. The adoption of this guidance is expected to increase both assets and liabilities, but is not expected to have a material impact on Park's consolidated statement of income.

ASU 2016-09 - Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting: In March 2016, FASB issued ASU 2016-09 - Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting. The ASU provides simplification for several aspects of accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. The new guidance is effective for annual reporting periods and interim reporting periods within those annual periods, beginning after December 15, 2016. Early adoption was permitted. The adoption of this guidance on January 1, 2017 did not have a material impact on Park's consolidated financial statements.

ASU 2016-13 - Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments: In June 2016, FASB issued ASU 2016-13 - Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. The new guidance replaces the incurred loss model with an expected loss model, which is referred to as the current expected credit loss ("CECL") model. The CECL model is applicable to the measurement of credit losses on financial assets measured at amortized cost, including loan receivables, HTM debt securities, and reinsurance receivables. It also applies to off-balance sheet credit exposures not accounted for as insurance (loan commitments, standby letters of credit, financial guarantees, and other similar instruments) and net investments in leases recognized by a lessor. The CECL model requires an entity to estimate the credit losses over the life of an asset or off-balance sheet exposure. The new guidance is effective for annual reporting periods and interim reporting periods within those annual periods, beginning after December 15, 2019. Early adoption is permitted for annual reporting periods and interim reporting periods within those annual periods, beginning after December 15, 2018.

Management is currently evaluating the impact of the adoption of this guidance on Park's consolidated financial statements. We anticipate that the adoption of the CECL model will result in a material increase to Park's allowance for loan losses. Management has established a committee to oversee the implementation of CECL. This committee is currently assessing the data and system requirements necessary for adoption. Management plans to run our current model and a CECL model concurrently for 12 months prior to the adoption of this guidance on January 1, 2020.

ASU 2016-15 - Statement of Cash Flows (Topic 203): Classification of Certain Cash Receipts and Cash Payments (a consensus of the Emerging Issues Task Force):  In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 203): Classification of Certain Cash Receipts and Cash Payments (a consensus of the Emerging Issues Task Force).  This ASU provides guidance on eight specific cash flow issues where current GAAP is either unclear or does not include specific guidance. The new guidance is effective for annual reporting periods, and interim reporting periods within those annual periods, beginning after December 15, 2017.  As such transactions arise, management will utilize the updated guidance within Park’s consolidated statements of cash flows. 

ASU 2017-04 - Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment:  In January 2017, the FASB issued ASU 2017-04, Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment. This ASU eliminates Step 2 from the goodwill impairment test. Instead, under the new guidance, an entity should perform its annual goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An impairment charge would be recognized for the amount by which the carrying amount exceeds the reporting unit's fair value. The new guidance is effective for annual reporting periods, and interim reporting periods within those annual periods, beginning after December 15, 2019. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The adoption of this guidance is not expected to have an impact on Park's consolidated financial statements.

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Summary of Significant Accounting Policies (Tables)

12 Months Ended

Dec. 31, 2016

Accounting Policies [Abstract]

Schedule of depreciable lives of premises and equipment

The range of depreciable lives over which premises and equipment are being depreciated are:

Buildings	30 Years
Equipment, furniture and fixtures	3 to 12 Years
Leasehold improvements	1 to 10 Years

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Investment Securities (Tables)

12 Months Ended

Dec. 31, 2016

Investments, Debt and Equity Securities [Abstract]

Schedule of marketable securities

Investment securities at December 31, 2016 and December 31, 2015 were as follows:

(In thousands)	Amortized Cost		Gross Unrealized/Unrecognized Holding Gains		Gross Unrealized/Unrecognized Holding Losses		Estimated Fair Value
2016:
Securities Available-for-Sale
Obligations of U.S. Treasury and other U.S. Government sponsored entities	$	270,000	$	—	$	2,467	$	267,533
U.S. Government sponsored entities’ asset-backed securities	991,642		5,372		9,842		987,172
Other equity securities	1,119		2,315		—		3,434
Total	$	1,262,761	$	7,687	$	12,309	$	1,258,139
2016:
Securities Held-to-Maturity
Obligations of states and political subdivisions	$	188,622	$	977	$	5,148	$	184,451
U.S. Government sponsored entities’ asset-backed securities	71,211		1,097		87		72,221
Total	$	259,833	$	2,074	$	5,235	$	256,672

(In thousands)	Amortized Cost		Gross Unrealized/Unrecognized Holding Gains		Gross Unrealized/Unrecognized Holding Losses		Estimated Fair Value
2015:
Securities Available-for-Sale
Obligations of U.S. Treasury and other U.S. Government sponsored entities	$	527,605	$	—	$	5,542	$	522,063
U.S. Government sponsored entities’ asset-backed securities	907,989		8,776		5,272		911,493
Other equity securities	1,120		1,590		—		2,710
Total	$	1,436,714	$	10,366	$	10,814	$	1,436,266
2015:
Securities Held-to-Maturity
Obligations of states and political subdivisions	$	48,190	$	734	$	—	$	48,924
U.S. Government sponsored entities’ asset-backed securities	101,112		1,526		134		102,504
Total	$	149,302	$	2,260	$	134	$	151,428

Schedule of unrealized loss on investments

The following table provides detail on investment securities with unrealized losses aggregated by investment category and length of time the individual securities had been in a continuous loss position at December 31, 2016 and December 31, 2015:

	Less than 12 Months				12 Months or Longer				Total
(In thousands)	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
2016:
Securities Available-for-Sale
Obligations of U.S. Treasury and other U.S. Government sponsored entities	$	247,695	$	2,305	$	19,838	$	162	$	267,533	$	2,467
U.S. Government sponsored entities' asset-backed securities	612,321		9,473		27,325		369		639,646		9,842
Total	$	860,016	$	11,778	$	47,163	$	531	$	907,179	$	12,309
2016:
Securities Held-to-Maturity
Obligations of states and political subdivisions	$	134,909	$	5,148	$	—	$	—	$	134,909	$	5,148
U.S. Government sponsored entities’ asset-backed securities	—		—		7,564		87		7,564		87
Total	$	134,909	$	5,148	$	7,564	$	87	$	142,473	$	5,235

	Less than 12 Months				12 Months or Longer				Total
(In thousands)	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
2015:
Securities Available-for-Sale
Obligations of U.S. Treasury and other U.S. Government sponsored entities	$	326,973	$	2,117	$	195,090	$	3,425	$	522,063	$	5,542
U.S. Government sponsored entities' asset-backed securities	384,169		2,776		114,543		2,496		498,712		5,272
Total	$	711,142	$	4,893	$	309,633	$	5,921	$	1,020,775	$	10,814
2015:
Securities Held-to-Maturity
U.S. Government sponsored entities' asset-backed securities	$	5,656	$	10	$	7,792	$	124	$	13,448	$	134

Schedule of contractual maturity of debt securities

The amortized cost and estimated fair value of investments in debt securities at December 31, 2016, are shown in the following table by contractual maturity, except for asset-backed securities, which are shown as a single total, due to the unpredictability of the timing in principal repayments.

(In thousands)	Amortized Cost		Estimated Fair Value		Tax Equivalent Yield (1)
Securities Available-for-Sale
U.S. Treasury and other U.S. Government sponsored entities’ notes:
Due within one year	$	25,000	$	24,933	0.87	%
Due one through five years	245,000		242,600		1.22	%
Total	$	270,000	$	267,533	1.18	%
U.S. Government sponsored entities’ asset-backed securities	$	991,642	$	987,172	2.10	%
Securities Held-to-Maturity
Obligations of states and political subdivisions
Due greater than ten years	$	188,622	$	184,451	4.50	%
Total	$	188,622	$	184,451	4.50	%
U.S. Government sponsored entities’ asset-backed securities	$	71,211	$	72,221	3.31	%

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Loans (Tables)

12 Months Ended

Dec. 31, 2016

Loans and Leases Receivable Disclosure [Abstract]

Schedule of composition of loan portfolio by class of loan

The composition of the loan portfolio, by class of loan, as of December 31, 2016 and December 31, 2015 was as follows:

	12/31/2016						12/31/2015
(In thousands)	Loan Balance		Accrued Interest Receivable		Recorded Investment		Loan Balance		Accrued Interest Receivable		Recorded Investment
Commercial, financial and agricultural *	$	994,619	$	3,558	$	998,177	$	955,727	$	3,437	$	959,164
Commercial real estate *	1,155,703		4,161		1,159,864		1,113,603		4,009		1,117,612
Construction real estate:
SEPH commercial land and development	—		—		—		2,044		—		2,044
Remaining commercial	135,343		398		135,741		128,046		321		128,367
Mortgage	48,699		106		48,805		36,722		75		36,797
Installment	4,903		17		4,920		6,533		21		6,554
Residential real estate:
Commercial	406,687		940		407,627		410,571		1,014		411,585
Mortgage	1,169,495		1,459		1,170,954		1,210,819		1,469		1,212,288
HELOC	212,441		853		213,294		211,415		769		212,184
Installment	19,874		67		19,941		22,638		78		22,716
Consumer	1,120,850		3,385		1,124,235		967,111		3,032		970,143
Leases	3,243		29		3,272		2,856		14		2,870
Total loans	$	5,271,857	$	14,973	$	5,286,830	$	5,068,085	$	14,239	$	5,082,324

* Included within commercial, financial and agricultural loans and commercial real estate loans is an immaterial amount of consumer loans that were not broken out by class.

Schedule of recorded investment in nonaccrual restructured and loans past due 90 days or more and accruing

The following table presents the recorded investment in nonaccrual loans, accruing troubled debt restructurings ("TDRs"), and loans past due 90 days or more and still accruing by class of loan as of December 31, 2016 and December 31, 2015:

	12/31/2016
(In thousands)	Nonaccrual Loans		Accruing Troubled Debt Restructurings		Loans Past Due 90 Days or More and Accruing		Total Nonperforming Loans
Commercial, financial and agricultural	$	20,057	$	600	$	15	$	20,672
Commercial real estate	19,169		5,305		—		24,474
Construction real estate:
SEPH commercial land and development	—		—		—		—
Remaining commercial	1,833		393		—		2,226
Mortgage	—		104		—		104
Installment	61		95		12		168
Residential real estate:
Commercial	23,013		89		—		23,102
Mortgage	18,313		9,612		887		28,812
HELOC	1,783		673		25		2,481
Installment	644		609		60		1,313
Consumer	2,949		748		1,139		4,836
Total loans	$	87,822	$	18,228	$	2,138	$	108,188

	12/31/2015
(In thousands)	Nonaccrual Loans		Accruing Troubled Debt Restructurings		Loans Past Due 90 Days or More and Accruing		Total Nonperforming Loans
Commercial, financial and agricultural	$	21,676	$	8,947	$	—	$	30,623
Commercial real estate	15,268		2,757		—		18,025
Construction real estate:
SEPH commercial land and development	2,044		—		—		2,044
Remaining commercial	4,162		514		—		4,676
Mortgage	7		110		—		117
Installment	64		114		—		178
Residential real estate:
Commercial	25,063		261		—		25,324
Mortgage	20,378		10,143		851		31,372
HELOC	1,749		873		27		2,649
Installment	1,657		635		4		2,296
Consumer	3,819		734		1,093		5,646
Total loans	$	95,887	$	25,088	$	1,975	$	122,950

Schedule of loans individually evaluated for impairment and loans collectively evaluated for impairment

The following table provides additional information regarding those nonaccrual and accruing TDR loans that are individually evaluated for impairment and those collectively evaluated for impairment as of December 31, 2016 and December 31, 2015.

	12/31/2016						12/31/2015
(In thousands)	Nonaccrual and accruing TDRs		Loans individually evaluated for impairment		Loans collectively evaluated for impairment		Nonaccrual and accruing TDRs		Loans individually evaluated for impairment		Loans collectively evaluated for impairment
Commercial, financial and agricultural	$	20,657	$	20,624	$	33	$	30,623	$	30,595	$	28
Commercial real estate	24,474		24,474		—		18,025		18,025		—
Construction real estate:
SEPH commercial land and development	—		—		—		2,044		2,044		—
Remaining commercial	2,226		2,226		—		4,676		4,676		—
Mortgage	104		—		104		117		—		117
Installment	156		—		156		178		—		178
Residential real estate:
Commercial	23,102		23,102		—		25,324		25,324		—
Mortgage	27,925		—		27,925		30,521		—		30,521
HELOC	2,456		—		2,456		2,622		—		2,622
Installment	1,253		—		1,253		2,292		—		2,292
Consumer	3,697		—		3,697		4,553		—		4,553
Total loans	$	106,050	$	70,426	$	35,624	$	120,975	$	80,664	$	40,311

Schedule of loans individually evaluated for impairment by class of loan

The following table presents loans individually evaluated for impairment by class of loan as of December 31, 2016 and December 31, 2015.

	12/31/2016						12/31/2015
(In thousands)	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	$	41,075	$	19,965	$	—	$	32,583	$	18,763	$	—
Commercial real estate	23,961		23,474		—		15,138		14,916		—
Construction real estate:
SEPH commercial land and development	—		—		—		10,834		2,044		—
Remaining commercial	3,662		2,226		—		2,506		1,531		—
Residential real estate:
Commercial	24,409		22,687		—		23,798		23,480		—
With an allowance recorded
Commercial, financial and agricultural	810		659		152		16,155		11,832		1,904
Commercial real estate	1,014		1,000		309		3,195		3,109		381
Construction real estate:
Remaining commercial	—		—		—		3,145		3,145		1,356
Residential real estate:
Commercial	427		415		87		1,951		1,844		550
Total	$	95,358	$	70,426	$	548	$	109,305	$	80,664	$	4,191

Schedule of average recorded investment and interest income recognized on loans individually evaluated for impairment

The following tables present the average recorded investment and interest income recognized during the year subsequent to impairment on loans individually evaluated for impairment as of and for the years ended December 31, 2016, 2015, and 2014:

			Year ended December 31, 2016
(In thousands)	Recorded Investment as of December 31, 2016		Average recorded investment		Interest income recognized
Commercial, financial and agricultural	$	20,624	$	26,821	$	885
Commercial real estate	24,474		22,828		884
Construction real estate:
SEPH commercial land and development	—		1,597		—
Remaining commercial	2,226		3,906		66
Residential real estate:
Commercial	23,102		24,341		2,942
Consumer	—		3		—
Total	$	70,426	$	79,496	$	4,777

			Year ended December 31, 2015
(In thousands)	Recorded Investment as of December 31, 2015		Average recorded investment		Interest income recognized
Commercial, financial and agricultural	$	30,595	$	20,179	$	340
Commercial real estate	18,025		17,883		550
Construction real estate:
SEPH commercial land and development	2,044		2,066		21
Remaining commercial	4,676		5,666		26
Residential real estate:
Commercial	25,324		24,968		1,026
Consumer	—		—		—
Total	$	80,664	$	70,762	$	1,963

			Year ended December 31, 2014
(In thousands)	Recorded Investment as of December 31, 2014		Average recorded investment		Interest income recognized
Commercial, financial and agricultural	$	19,106	$	19,518	$	360
Commercial real estate	21,989		31,945		1,027
Construction real estate:
SEPH commercial land and development	2,078		3,658		146
Remaining commercial	5,609		8,784		61
Residential real estate:
Commercial	24,930		28,306		1,084
Consumer	—		403		—
Total	$	73,712	$	92,614	$	2,678

Schedule of aging of the recorded investment in past due loans

The following tables present the aging of the recorded investment in past due loans as of December 31, 2016 and December 31, 2015 by class of loan.

	12/31/2016
(In thousands)	Accruing loans past due 30-89 days		Past due, nonaccrual loans and loans past due 90 days or more and accruing (1)		Total past due		Total current (2)		Total recorded investment
Commercial, financial and agricultural	$	371	$	4,113	$	4,484	$	993,693	$	998,177
Commercial real estate	355		2,499		2,854		1,157,010		1,159,864
Construction real estate:
SEPH commercial land and development	—		—		—		—		—
Remaining commercial	—		541		541		135,200		135,741
Mortgage	559		—		559		48,246		48,805
Installment	223		64		287		4,633		4,920
Residential real estate:
Commercial	330		3,631		3,961		403,666		407,627
Mortgage	10,854		9,769		20,623		1,150,331		1,170,954
HELOC	970		1,020		1,990		211,304		213,294
Installment	350		319		669		19,272		19,941
Consumer	12,579		2,094		14,673		1,109,562		1,124,235
Leases	—		—		—		3,272		3,272
Total loans	$	26,591	$	24,050	$	50,641	$	5,236,189	$	5,286,830

(1) Includes an aggregate of $2.1 million of loans past due 90 days or more and accruing. The remaining are past due, nonaccrual loans.

(2) Includes an aggregate of $65.9 million of nonaccrual loans which are current in regards to contractual principal and interest payments.

	12/31/2015
(In thousands)	Accruing loans past due 30-89 days		Past due, nonaccrual loans and loans past due 90 days or more and accruing (1)		Total past due		Total current (2)		Total recorded investment
Commercial, financial and agricultural	$	670	$	7,536	$	8,206	$	950,958	$	959,164
Commercial real estate	142		530		672		1,116,940		1,117,612
Construction real estate:
SEPH commercial land and development	—		2,044		2,044		—		2,044
Remaining commercial	165		84		249		128,118		128,367
Mortgage	63		7		70		36,727		36,797
Installment	200		46		246		6,308		6,554
Residential real estate:
Commercial	325		19,521		19,846		391,739		411,585
Mortgage	10,569		8,735		19,304		1,192,984		1,212,288
HELOC	487		186		673		211,511		212,184
Installment	426		318		744		21,972		22,716
Consumer	11,458		3,376		14,834		955,309		970,143
Leases	—		—		—		2,870		2,870
Total loans	$	24,505	$	42,383	$	66,888	$	5,015,436	$	5,082,324

Schedule of recorded investment by loan grade

The tables below present the recorded investment by loan grade at December 31, 2016 and December 31, 2015 for all commercial loans:

	12/31/2016
(In thousands)	5 Rated		6 Rated		Impaired		Pass Rated		Recorded Investment
Commercial, financial and agricultural*	$	5,826	$	—	$	20,657	$	971,694	$	998,177
Commercial real estate*	7,548		190		24,474		1,127,652		1,159,864
Construction real estate:
SEPH commercial land and development	—		—		—		—		—
Remaining commercial	287		118		2,226		133,110		135,741
Residential real estate:
Commercial	1,055		124		23,102		383,346		407,627
Leases	—		—		—		3,272		3,272
Total Commercial Loans	$	14,716	$	432	$	70,459	$	2,619,074	$	2,704,681

* Included within commercial, financial and agricultural loans and commercial real estate loans is an immaterial amount of consumer loans that were not broken out by class.

	12/31/2015
(In thousands)	5 Rated		6 Rated		Impaired		Pass Rated		Recorded Investment
Commercial, financial and agricultural*	$	4,392	$	347	$	30,623	$	923,802	$	959,164
Commercial real estate*	14,880		3,417		18,025		1,081,290		1,117,612
Construction real estate:
SEPH commercial land and development	—		—		2,044		—		2,044
Remaining commercial	2,151		122		4,676		121,418		128,367
Residential real estate:
Commercial	3,280		386		25,324		382,595		411,585
Leases	—		—		—		2,870		2,870
Total Commercial Loans	$	24,703	$	4,272	$	80,692	$	2,511,975	$	2,621,642

Schedule of troubled debt restructurings on financing receivables

The following tables detail the number of contracts modified as TDRs during the years ended December 31, 2016, 2015 and 2014 as well as the recorded investment of these contracts at December 31, 2016, 2015, and 2014. The recorded investment pre- and post-modification is generally the same due to the fact that Park does not typically forgive principal.

	Year ended December 31, 2016
(In thousands)	Number of Contracts	Accruing		Nonaccrual		Recorded Investment
Commercial, financial and agricultural	32	$	191	$	8,450	$	8,641
Commercial real estate	14	3,844		2,537		6,381
Construction real estate:
SEPH commercial land and development	—	—		—		—
Remaining commercial	2	—		1,143		1,143
Mortgage	—	—		—		—
Installment	1	—		—		—
Residential real estate:
Commercial	11	89		1,033		1,122
Mortgage	34	114		2,292		2,406
HELOC	13	104		178		282
Installment	5	102		3		105
Consumer	293	184		994		1,178
Total loans	405	$	4,628	$	16,630	$	21,258

	Year ended December 31, 2015
(In thousands)	Number of Contracts	Accruing		Nonaccrual		Recorded Investment
Commercial, financial and agricultural	39	$	8,948	$	3,640	$	12,588
Commercial real estate	14	637		3,523		4,160
Construction real estate:
SEPH commercial land and development	—	—		—		—
Remaining commercial	2	513		—		513
Mortgage	1	19		—		19
Installment	—	—		—		—
Residential real estate:
Commercial	11	—		1,185		1,185
Mortgage	39	1,132		2,122		3,254
HELOC	26	315		45		360
Installment	9	—		155		155
Consumer	283	202		888		1,090
Total loans	424	$	11,766	$	11,558	$	23,324

	Year ended December 31, 2014
(In thousands)	Number of Contracts	Accruing		Nonaccrual		Recorded Investment
Commercial, financial and agricultural	30	$	292	$	431	$	723
Commercial real estate	11	1,184		1,254		2,438
Construction real estate:
SEPH commercial land and development	—	—		—		—
Remaining commercial	2	—		206		206
Mortgage	—	—		—		—
Installment	2	—		56		56
Residential real estate:
Commercial	9	—		866		866
Mortgage	46	32		2,325		2,357
HELOC	10	85		241		326
Installment	10	109		12		121
Consumer	330	244		1,058		1,302
Total loans	450	$	1,946	$	6,449	$	8,395

Schedule recorded investment in financing receivables which were modified as troubled debt restructurings within the previous 12 months and for which there was a payment default during the 12 month

The following table presents the recorded investment in financing receivables which were modified as TDRs within the previous 12 months and for which there was a payment default during the year ended December 31, 2016, December 31, 2015, and December 31, 2014. For this table, a loan is considered to be in default when it becomes 30 days contractually past due under the modified terms. The additional allowance for loan loss resulting from the defaults on TDR loans was immaterial.

	Year ended December 31, 2016			Year ended December 31, 2015				Year ended December 31, 2014
(In thousands)	Number of Contracts	Recorded Investment		Number of Contracts		Recorded Investment		Number of Contracts	Recorded Investment
Commercial, financial and agricultural	7	$	419	1		$	1	4	$	206
Commercial real estate	5	843		1		626		1	302
Construction real estate:
SEPH commercial land and development	—	—		—		—		—	—
Remaining commercial	—	—		—		—		—	—
Mortgage	—	—		—		—		—	—
Installment	—	—		—		—		—	—
Residential real estate:
Commercial	7	848		3		1,005		1	3
Mortgage	15	1,201		12		682		14	810
HELOC	—	—		1		5		2	160
Installment	1	3		2		101		2	12
Consumer	62	484		47		434		62	516
Leases	—	—		—		—		—	—
Total loans	97	$	3,798	$	67	$	2,854	86	$	2,009

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Allowance for Loan Losses (Tables)

12 Months Ended

Dec. 31, 2016

Allowance For Loan Losses [Abstract]

Schedule of the activity in the allowance for loan losses

The activity in the allowance for loan losses for the years ended December 31, 2016, 2015, and 2014 is summarized in the following tables.

	Year ended December 31, 2016
(In thousands)	Commercial, financial and agricultural			Commercial real estate			Construction real estate			Residential real estate			Consumer			Leases			Total
Allowance for credit losses:
Beginning balance	$	13,694		$	9,197		$	8,564		$	13,514		$	11,524		$	1		$	56,494
Charge-offs	5,786			412			1,436			3,014			10,151			—			20,799
Recoveries	(1,259		)	(3,671		)	(8,559		)	(2,446		)	(4,094		)	(1		)	(20,030		)
Net charge-offs (recoveries)	4,527			(3,259		)	(7,123		)	568			6,057			(1		)	769
Provision (Recovery)	4,267			(2,024		)	(10,440		)	(1,988		)	5,086			(2		)	(5,101		)
Ending balance	$	13,434		$	10,432		$	5,247		$	10,958		$	10,553		—			$	50,624

	Year ended December 31, 2015
(In thousands)	Commercial, financial and agricultural			Commercial real estate			Construction real estate			Residential real estate			Consumer			Leases			Total
Allowance for credit losses:
Beginning balance	$	10,719		$	8,808		$	8,652		$	14,772		$	11,401		$	—		$	54,352
Charge-offs	2,478			348			470			2,352			8,642			—			14,290
Recoveries	(1,373		)	(2,241		)	(2,092		)	(2,438		)	(3,295		)	(3		)	(11,442		)
Net charge-offs (recoveries)	1,105			(1,893		)	(1,622		)	(86		)	5,347			(3		)	2,848
Provision (Recovery)	4,080			(1,504		)	(1,710		)	(1,344		)	5,470			(2		)	4,990
Ending balance	$	13,694		$	9,197		$	8,564		$	13,514		$	11,524		$	1		$	56,494

	Year ended December 31, 2014
(In thousands)	Commercial, financial and agricultural			Commercial real estate			Construction real estate			Residential real estate			Consumer			Leases			Total
Allowance for credit losses:
Beginning balance	$	14,218		$	15,899		$	6,855		$	14,251		$	8,245		$	—		$	59,468
Charge-offs	3,779			8,003			1,316			3,944			7,738			—			24,780
Recoveries	(1,003		)	(7,759		)	(12,572		)	(2,985		)	(2,671		)	(7		)	(26,997		)
Net charge-offs (recoveries)	2,776			244			(11,256		)	959			5,067			(7		)	(2,217		)
(Recovery) Provision	(723		)	(6,847		)	(9,459		)	1,480			8,223			(7		)	(7,333		)
Ending balance	$	10,719		$	8,808		$	8,652		$	14,772		$	11,401		$	—		$	54,352

Schedule of the composition of the allowance for loan losses

The composition of the allowance for loan losses at December 31, 2016 and 2015 was as follows: 

	December 31, 2016
(In thousands)	Commercial, financial, and agricultural			Commercial real estate			Construction real estate			Residential real estate			Consumer			Leases			Total
Allowance for loan losses:
Ending allowance balance attributed to loans
Individually evaluated for impairment	$	152		$	309		$	—		$	87		$	—		$	—		$	548
Collectively evaluated for impairment	13,282			10,123			5,247			10,871			10,553			—			50,076
Total ending allowance balance	$	13,434		$	10,432		$	5,247		$	10,958		$	10,553		$	—		$	50,624
Loan Balance:
Loans individually evaluated for impairment	$	20,622		$	24,465		$	2,226		$	23,102		$	—		$	—		$	70,415
Loans collectively evaluated for impairment	973,997			1,131,238			186,719			1,785,395			1,120,850			3,243			5,201,442
Total ending loan balance	$	994,619		$	1,155,703		$	188,945		$	1,808,497		$	1,120,850		$	3,243		$	5,271,857
Allowance for loan losses as a percentage of loan balance:
Loans individually evaluated for impairment	0.74		%	1.26		%	—		%	0.38		%	—		%	—		%	0.78		%
Loans collectively evaluated for impairment	1.36		%	0.89		%	2.81		%	0.61		%	0.94		%	—		%	0.96		%
Total	1.35		%	0.90		%	2.78		%	0.61		%	0.94		%	—		%	0.96		%
Recorded Investment:
Loans individually evaluated for impairment	$	20,624		$	24,474		$	2,226		$	23,102		$	—		$	—		$	70,426
Loans collectively evaluated for impairment	977,553			1,135,390			187,240			1,788,714			1,124,235			3,272			5,216,404
Total ending recorded investment	$	998,177		$	1,159,864		$	189,466		$	1,811,816		$	1,124,235		$	3,272		$	5,286,830

	December 31, 2015
(In thousands)	Commercial, financial, and agricultural			Commercial real estate			Construction real estate			Residential real estate			Consumer			Leases			Total
Allowance for loan losses:
Ending allowance balance attributed to loans
Individually evaluated for impairment	$	1,904		$	381		$	1,356		$	550		$	—		$	—		$	4,191
Collectively evaluated for impairment	11,790			8,816			7,208			12,964			11,524			1			52,303
Total ending allowance balance	$	13,694		$	9,197		$	8,564		$	13,514		$	11,524		$	1		$	56,494
Loan Balance:
Loans individually evaluated for impairment	$	30,545		$	18,015		$	6,716		$	25,323		$	—		$	—		$	80,599
Loans collectively evaluated for impairment	925,182			1,095,588			166,629			1,830,120			967,111			2,856			4,987,486
Total ending loan balance	$	955,727		$	1,113,603		$	173,345		$	1,855,443		$	967,111		$	2,856		$	5,068,085
Allowance for loan losses as a percentage of loan balance:
Loans individually evaluated for impairment	6.23		%	2.11		%	20.19		%	2.17		%	—		%	—		%	5.20		%
Loans collectively evaluated for impairment	1.27		%	0.80		%	4.33		%	0.71		%	1.19		%	0.04		%	1.05		%
Total	1.43		%	0.83		%	4.94		%	0.73		%	1.19		%	0.04		%	1.11		%
Recorded Investment:
Loans individually evaluated for impairment	$	30,595		$	18,025		$	6,720		$	25,324		$	—		$	—		$	80,664
Loans collectively evaluated for impairment	928,569			1,099,587			167,042			1,833,449			970,143			2,870			5,001,660
Total ending recorded investment	$	959,164		$	1,117,612		$	173,762		$	1,858,773		$	970,143		$	2,870		$	5,082,324

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Other Real Estate Owned (Tables)

12 Months Ended

Dec. 31, 2016

Schedule of Assets Repossessed or Foreclosed, or loans in process of foreclosure [Line Items]

Schedule of Assets Repossessed or Foreclosed, or loans in process of foreclosure [Table Text Block] [Text Block]

The carrying amount of foreclosed properties held at December 31, 2016 and December 31, 2015 are listed below, as well as the recorded investment of loans secured by residential real estate properties for which formal foreclosure proceedings were in process at those dates.

(In thousands)	December 31, 2016		December 31, 2015
OREO:
Commercial real estate	$	7,642	$	8,333
Construction real estate	4,624		7,259
Residential real estate	1,660		3,059
Total OREO	$	13,926	$	18,651
Loans in process of foreclosure:
Residential real estate	$	3,250	$	2,021

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Premises And Equipment (Tables)

12 Months Ended

Dec. 31, 2016

Property, Plant and Equipment [Abstract]

Schedule of major categories of premises and equipment

The major categories of premises and equipment and accumulated depreciation are summarized as follows:

December 31 (In thousands)	2016			2015
Land	$	19,577		$	19,123
Buildings	75,472			74,525
Equipment, furniture and fixtures	52,719			47,839
Leasehold improvements	3,400			3,878
Total	$	151,168		$	145,365
Less accumulated depreciation	(93,197		)	(85,872		)
Premises and equipment, net	$	57,971		$	59,493

Schedule of future minimum rental payments under operating leases

The Corporation leases certain premises and equipment accounted for as operating leases. The following is a schedule of the future minimum rental payments required for the next five years under such leases with initial terms in excess of one year: 

(In thousands)
2017	$	1,508
2018	1,269
2019	1,178
2020	621
2021	422
Thereafter	700
Total	$	5,698

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Investment in Qualified Affordable Housing (Tables)

12 Months Ended

Dec. 31, 2016

Schedule of Equity Method Investments [Line Items]

Equity Method Investments [Table Text Block]

The table below details the balances of Park’s affordable housing tax credit investments and related unfunded commitments as of December 31, 2016 and 2015.

(In thousands)	December 31, 2016		December 31, 2015
Affordable housing tax credit investments	$	52,947	$	51,247
Unfunded commitments	14,282		20,311

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Deposits (Tables)

12 Months Ended

Dec. 31, 2016

Deposits [Abstract]

Schedule of summary of non-interest bearing and interest bearing deposits

At December 31, 2016 and 2015, non-interest bearing and interest bearing deposits were as follows:

December 31 (In thousands)	2016		2015
Non-interest bearing	$	1,523,417	$	1,404,032
Interest bearing	3,998,539		3,943,610
Total	$	5,521,956	$	5,347,642

Schedule of maturities of time deposits

At December 31, 2016, the maturities of time deposits were as follows: 

(In thousands)
2017	$	717,879
2018	131,236
2019	153,257
2020	63,758
2021	51,245
After 5 years	495
Total	$	1,117,870

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Repurchase Agreements (Tables)

12 Months Ended

Dec. 31, 2016

Transfers of Certain Financial Assets Accounted for as Secured Borrowings [Abstract]

Schedule of Assets and Associated Liabilities Accounted for as Secured Borrowings [Table Text Block]

The following table presents the carrying value of Park's repurchase agreements by remaining contractual maturity and collateral pledged at December 31, 2016 and December 31, 2015:

	December 31, 2016
(In thousands)	Remaining Contractual Maturity of the Agreements
	Overnight and Continuous		Up to 30 days		30 - 90 days		Greater than 90 days		Total
U.S. government and agency securities	$	208,691	$	—	$	—	$	301,104	$	509,795
	December 31, 2015
(In thousands)	Remaining Contractual Maturity of the Agreements
	Overnight and Continuous		Up to 30 days		30 - 90 days		Greater than 90 days		Total
U.S. government and agency securities	$	247,618	$	2,239	$	—	$	304,385	$	554,242

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Short-Term Borrowings (Tables)

12 Months Ended

Dec. 31, 2016

Short-term Debt [Abstract]

Schedule of short-term debt

The outstanding balances for all short-term borrowings as of December 31, 2016 and 2015 and the weighted-average interest rates as of and paid during each of the years then ended were as follows: 

(In thousands)	Repurchase agreements			FHLB Advances
2016
Ending balance	$	209,795		$	185,000
Highest month-end balance	248,277			185,000
Average daily balance	224,763			15,694
Weighted-average interest rate:
As of year-end	0.17		%	0.80		%
Paid during the year	0.16		%	0.63		%
2015
Ending balance	$	254,242		$	140,000
Highest month-end balance	278,324			140,000
Average daily balance	257,622			1,096
Weighted-average interest rate:
As of year-end	0.17		%	0.56		%
Paid during the year	0.18		%	0.59		%

Short-term borrowings were as follows:

December 31 (In thousands)	2016		2015
Securities sold under agreements to repurchase	$	209,795	$	254,242
FHLB advances	185,000		140,000
Total short-term borrowings	$	394,795	$	394,242

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Long-Term Debt (Tables)

12 Months Ended

Dec. 31, 2016

Debt Disclosure [Abstract]

Schedule of maturities of long-term debt

Long-term debt is listed below:

December 31,	2016					2015
(In thousands)	Outstanding Balance			Average Rate		Outstanding Balance			Average Rate
Total Federal Home Loan Bank advances by year of maturity:
2017	$	50,000		1.25	%	$	50,000		1.25	%
2018	150,000			2.04	%	150,000			2.04	%
2019	75,000			1.96	%	75,000			1.96	%
2020	25,000			2.14	%	25,000			2.14	%
2021	—			—	%	—			—	%
Thereafter	100,000			3.40	%	150,000			3.32	%
Total	$	400,000		2.27	%	450,000			2.37	%
Total broker repurchase agreements by year of maturity:
2017	300,000			1.75	%	300,000			1.75	%
Total	$	300,000		1.75	%	$	300,000		1.75	%
Total combined long-term debt by year of maturity:
2017	350,000			1.68	%	350,000			1.68	%
2018	150,000			2.04	%	150,000			2.04	%
2019	75,000			1.96	%	75,000			1.96	%
2020	25,000			2.14	%	25,000			2.14	%
2021	—			—	%	—			—	%
Thereafter	100,000			3.40	%	150,000			3.32	%
Total	$	700,000		2.05	%	$	750,000		2.12	%
Prepayment penalty	(5,719		)	—		(11,895		)	—
Total long-term debt	$	694,281		2.07	%	$	738,105		2.16	%

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Share-Based Compensation Changes in nonvested shares (Tables)

12 Months Ended

Dec. 31, 2016

Share-based Compensation Arrangement by Share-based Payment Award [Line Items]

Disclosure of Share-based Compensation Arrangements by Share-based Payment Award [Table Text Block]

A summary of changes in Park's nonvested shares for the year ended December 31, 2016 follows:

	Shares
Nonvested at January 1, 2016	44,700
Granted	41,550
Vested	—
Forfeited	825
Nonvested at December 31, 2016	85,425

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Share-Based Compensation Additional share based compensation expense related to PBRSUs (Tables)

12 Months Ended

Dec. 31, 2016

Share-based Compensation Arrangement by Share-based Payment Award [Line Items]

Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Period for Recognition

The following table details expected additional share-based compensation expense related to PBRSUs currently outstanding:

(In thousands)
2017	$	1,193
2018	1,072
2019	491
2020	83
Total	$	2,839

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Benefit Plans (Tables)

12 Months Ended

Dec. 31, 2016

Defined Benefit Pension Plans and Defined Benefit Postretirement Plans Disclosure [Abstract]

Schedule of plan assets and benefit obligation activity

Using an accrual measurement date of December 31, 2016 and 2015, plan assets and benefit obligation activity for the Pension Plan are listed below:

(In thousands)	2016			2015
Change in fair value of plan assets
Fair value at beginning of measurement period	$	153,498		$	160,598
Actual return on plan assets	19,256			(58		)
Benefits paid	(5,707		)	(7,042		)
Fair value at end of measurement period	$	167,047		$	153,498
Change in benefit obligation
Projected benefit obligation at beginning of measurement period	$	102,245		$	109,328
Service cost	5,055			5,368
Interest cost	4,869			4,695
Actuarial loss (gains)	7,993			(10,104		)
Benefits paid	(5,707		)	(7,042		)
Projected benefit obligation at the end of measurement period	$	114,455		$	102,245
Funded status at end of year (fair value of plan assets less benefit obligation)	$	52,592		$	51,253

Schedule of allocation of plan assets

The asset allocation for the Pension Plan as of each measurement date, by asset category, was as follows:

		Percentage of Plan Assets
Asset category	Target Allocation	2016		2015
Equity securities	50% - 100%	84	%	85	%
Fixed income and cash equivalents	remaining balance	16	%	15	%
Total		100	%	100	%

Schedule of assumptions used to determine benefit obligations

The weighted average assumptions used to determine benefit obligations at December 31, 2016, 2015 and 2014 were as follows:

	2016		2015		2014
Discount rate	4.58	%	4.88	%	4.42	%
Rate of compensation increase
Under age 30	10.00	%	10.00	%	10.00	%
Ages 30-39	6.00	%	6.00	%	6.00	%
Ages 40-49	4.00	%	3.00	%	3.00	%
Ages 50 and over	3.00	%	3.00	%	3.00	%

Schedule of estimated future pension benefit Payments

The estimated future pension benefit payments reflecting expected future service for the next ten years are shown below (in thousands):

2017	$	6,924
2018	7,644
2019	7,875
2020	8,393
2021	9,503
2022-2026	48,058
Total	$	88,397

Schedule of balances of accumulated other comprehensive income loss

The following table shows ending balances of accumulated other comprehensive loss at December 31, 2016 and 2015.

(In thousands)	2016			2015
Prior service cost	$	—		$	—
Net actuarial loss	(22,677		)	(23,618		)
Total	(22,677		)	(23,618		)
Deferred taxes	7,937			8,267
Accumulated other comprehensive loss	$	(14,740	)	$	(15,351	)

Schedule of components of net periodic benefit cost and other amounts recognized in other comprehensive income (loss)

Using an actuarial measurement date of December 31 for 2016, 2015 and 2014, components of net periodic benefit income and other amounts recognized in other comprehensive income (loss) were as follows:

(In thousands)	2016			2015			2014
Components of net periodic benefit income and other amounts recognized in other comprehensive income
Service cost	$	(5,055	)	$	(5,368	)	$	(4,331	)
Interest cost	(4,869		)	(4,695		)	(4,577		)
Expected return on plan assets	10,950			11,420			10,869
Amortization of prior service cost	—			(15		)	(19		)
Recognized net actuarial loss	(773		)	(637		)	—
Net periodic benefit income	$	253		$	705		$	1,942
Change to net actuarial gain (loss) for the period	$	168		$	(1,400	)	$	(14,276	)
Amortization of prior service cost	—			15			19
Amortization of net loss	773			637			—
Total recognized in other comprehensive income (loss)	941			(748		)	(14,257		)
Total recognized in net benefit income and other comprehensive income (loss)	$	1,194		$	(43	)	$	(12,315	)

Schedule of assumptions used to determine costs

The weighted average assumptions used to determine net periodic benefit cost for the years ended December 31, 2016, 2015 and 2014 are listed below:

	2016		2015		2014
Discount Rate	4.88	%	4.42	%	5.30	%
Rate of compensation increase
Under age 30	10.00	%	10.00	%	10.00	%
Ages 30-39	6.00	%	6.00	%	6.00	%
Ages 40 and over	3.00	%	3.00	%	3.00	%
Expected long-term return on plan assets	7.25	%	7.25	%	7.25	%

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Income Taxes (Tables)

12 Months Ended

Dec. 31, 2016

Income Tax Disclosure [Abstract]

Schedule of deferred tax assets and liabilities

Significant components of the Corporation’s deferred tax assets and liabilities are as follows:

December 31 (In thousands)	2016		2015
Deferred tax assets:
Allowance for loan losses	$	17,719	$	19,773
Accumulated other comprehensive loss – Pension plan	7,937		8,266
Accumulated other comprehensive loss – Unrealized losses on securities	1,618		157
Deferred compensation	4,140		3,908
OREO valuation adjustments	2,322		2,418
Net deferred loan fees	1,397		1,204
Deferred contract bonus	1,074		1,031
Nonvested equity-based compensation	1,115		463
Fixed assets	781		413
Accrued litigation	793		482
Other	2,525		2,813
Total deferred tax assets	$	41,421	$	40,928
Deferred tax liabilities:
Deferred investment income	10,199		10,199
Pension plan	26,344		26,205
Mortgage servicing rights	3,243		3,153
Partnership adjustments	549		560
Other	596		872
Total deferred tax liabilities	$	40,931	$	40,989
Net deferred tax asset (liability)	$	490	$	(61	)

Federal and state income taxes

The components of the provision for federal income taxes are shown below:

December 31, (In thousands)	2016		2015			2014
Currently payable
Federal	$	28,879	$	26,153		$	27,062
Amortization of qualified affordable housing projects	7,300		6,664			6,869
Deferred
Federal	581		(250		)	2,528
Total	$	36,760	$	32,567		$	36,459

Schedule of income tax rate reconciliation

The following is a reconciliation of income tax expense to the amount computed at the statutory rate of 35% for the years ended December 31, 2016, 2015 and 2014.

	2016		2015		2014
Statutory federal corporate tax rate	35.0	%	35.0	%	35.0	%
Changes in rates resulting from:
Tax exempt interest income, net of disallowed interest	(1.3	)%	(0.5	)%	(0.5	)%
Bank owned life insurance	(1.2	)%	(1.8	)%	(1.4	)%
Investments in qualified affordable housing projects, net of tax benefits	(1.7	)%	(1.9	)%	(1.6	)%
Other tax credits	—	%	(0.9	)%	—	%
KSOP dividend deduction	(1.0	)%	(1.0	)%	(1.0	)%
Other	0.1	%	(0.2	)%	(0.2	)%
Effective tax rate	29.9	%	28.7	%	30.3	%

Reconciliation of unrecognized tax benefits

The following is a reconciliation of the beginning and ending amount of unrecognized tax benefits.

(In thousands)	2016			2015			2014
January 1 Balance	$	558		$	532		$	518
Additions based on tax positions related to the current year	117			80			76
Additions for tax positions of prior years	38			16			14
Reductions for tax positions of prior years	—			—			—
Reductions due to statute of limitations	(80		)	(70		)	(76		)
December 31 Balance	$	633		$	558		$	532

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Other Comprehensive Income (Loss) (Tables)

12 Months Ended

Dec. 31, 2016

Other Comprehensive Income (Loss) [Abstract]

Schedule of Accumulated Other Comprehensive Income (Loss) [Table Text Block]

Other comprehensive income (loss) components, net of income tax, are shown in the following table for the years ended December 31, 2016, 2015 and 2014.

Year ended December 31, (in thousands)		Changes in Pension Plan assets and benefit obligations			Unrealized gains and losses on available-for-sale securities			Total
Beginning balance at January 1, 2016		$	(15,351	)	$	(292	)	$	(15,643	)
	Other comprehensive gain (loss) before reclassifications	109			(2,713		)	(2,604		)
	Amounts reclassified from accumulated other comprehensive loss	502			—			502
Net current period other comprehensive income (loss)		611			(2,713		)	(2,102		)
Ending balance at December 31, 2016		$	(14,740	)	$	(3,005	)	$	(17,745	)
Beginning balance at January 1, 2015		$	(14,865	)	$	1,257		$	(13,608	)
	Other comprehensive loss before reclassifications	(910		)	(1,549		)	(2,459		)
	Amounts reclassified from accumulated other comprehensive loss	424			—			424
Net current period other comprehensive loss		(486		)	(1,549		)	(2,035		)
Ending balance at December 31, 2015		$	(15,351	)	$	(292	)	$	(15,643	)
Beginning balance at January 1, 2014		$	(5,598	)	$	(29,821	)	$	(35,419	)
	Other comprehensive (loss) gain before reclassifications	(9,279		)	30,325			21,046
	Amounts reclassified from accumulated other comprehensive loss	12			753			765
Net current period other comprehensive (loss) income		(9,267		)	31,078			21,811
Ending balance at December 31, 2014		$	(14,865	)	$	1,257		$	(13,608	)

Schedule of components of other comprehensive income (loss)

The following table provides information concerning amounts reclassified out of accumulated other comprehensive loss for the years ended December 31, 2016, 2015 and 2014:

		Amount Reclassified from Accumulated Other Comprehensive Income (Loss)						Affected Line Item in the Consolidated Statement of Income
(In thousands)		2016		2015		2014
Amortization of defined benefit pension items
	Amortization of prior service cost	$	—	$	15	$	19	Employee benefits
	Amortization of net loss	773		637		—		Employee benefits
Income before income taxes		773		652		19		Income before income taxes
	Federal income taxes	271		228		7		Federal income taxes
	Net of income tax	$	502	$	424	$	12	Net of income tax
Unrealized gains & losses on available for sale securities
	Loss on sale of investment securities	$	—	$	—	$	1,158	Gain (loss) on sale of investment securities
	Other than temporary impairment	—		—		—		Miscellaneous expense
Income before income taxes		—		—		1,158		Income before income taxes
	Federal income taxes	—		—		405		Federal income taxes
	Net of income tax	$	—	$	—	$	753	Net of income tax

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Earnings Per Common Share (Tables)

12 Months Ended

Dec. 31, 2016

Earnings Per Share [Abstract]

Schedule of computation of basic and diluted earnings per common share

The following table sets forth the computation of basic and diluted earnings per common share:

Year ended December 31 (In thousands, except share data)	2016		2015		2014
Numerator:
Net income available to common shareholders	$	86,135	$	81,012	$	83,957
Denominator:
Weighted-average common shares outstanding	15,332,553		15,364,281		15,394,971
Effect of dilutive performance-based restricted stock units	72,607		40,459		18,861
Weighted-average common shares outstanding adjusted for the effect of dilutive performance-based restricted stock units	15,405,160		15,404,740		15,413,832
Earnings per common share:
Basic earnings per common share	$	5.62	$	5.27	$	5.45
Diluted earnings per common share	$	5.59	$	5.26	$	5.45

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Financial Instruments With Off-Balance Sheet Risk And Financial Instruments With Concentrations Of Credit Risk (Tables)

12 Months Ended

Dec. 31, 2016

Risks and Uncertainties [Abstract]

Schedule of off-balance sheet financial instruments with credit risk

The total amounts of off-balance sheet financial instruments with credit risk were as follows:

December 31 (In thousands)	2016		2015
Loan commitments	$	912,007	$	888,411
Standby letters of credit	13,746		12,326

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Loan Servicing (Tables)

12 Months Ended

Dec. 31, 2016

Transfers and Servicing of Financial Assets [Abstract]

Schedule of servicing assets at amortized value

Activity for mortgage servicing rights and the related valuation allowance follows:

December 31 (In thousands)	2016			2015			2014
Mortgage servicing rights:
Carrying amount, net, beginning of year	$	9,008		$	8,613		$	9,013
Additions	2,286			1,748			1,026
Amortization	(1,835		)	(1,637		)	(1,631		)
Change in valuation allowance	(193		)	284			205
Carrying amount, net, end of year	$	9,266		$	9,008		$	8,613
Valuation allowance:
Beginning of year	$	542		$	826		$	1,031
Change in valuation allowance	193			(284		)	(205		)
End of year	$	735		$	542		$	826

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Fair Values (Tables)

12 Months Ended

Dec. 31, 2016

Fair Value Inputs, Assets, Quantitative Information [Line Items]

Schedule of financial assets and liabilities measured on a recurring basis

The following table presents assets and liabilities measured at fair value on a recurring basis:

Fair Value Measurements at December 31, 2016 using:
(In thousands)	Level 1		Level 2		Level 3		Balance at December 31, 2016
Assets
Investment securities:
Obligations of U.S. Treasury and other U.S. Government sponsored entities	$	—	$	267,533	$	—	$	267,533
U.S. Government sponsored entities’ asset-backed securities	—		987,172		—		987,172
Equity securities	2,644		—		790		3,434
Mortgage loans held for sale	—		10,413		—		10,413
Mortgage IRLCs	—		124		—		124
Liabilities
Fair value swap	$	—	$	—	$	226	$	226

Fair Value Measurements at December 31, 2015 using:
(In thousands)	Level 1		Level 2		Level 3		Balance at December 31, 2015
Assets
Investment securities:
Obligations of U.S. Treasury and other U.S. Government sponsored entities	$	—	$	522,063	$	—	$	522,063
U.S. Government sponsored entities’ asset-backed securities	—		911,493		—		911,493
Equity securities	1,941		—		769		2,710
Mortgage loans held for sale	—		7,306		—		7,306
Mortgage IRLCs	—		165		—		165
Liabilities
Fair value swap	$	—	$	—	$	226	$	226

Schedule of reconciliation of level 3 input for financial instruments measured on recurring basis

The table below is a reconciliation of the beginning and ending balances of the Level 3 inputs for the years ended December 31, 2016 and 2015, for financial instruments measured on a recurring basis and classified as Level 3:

Level 3 Fair Value Measurements
(In thousands)	Equity Securities			Fair Value Swap
Balance at January 1, 2016	$	769		$	(226	)
Total Gains (Losses)
Included in earnings - realized	—			—
Included in earnings - unrealized	—			—
Included in other comprehensive income	21			—
Purchases, sales, issuances and settlements, other, net	—			—
Re-evaluation of fair value swap	—			—
Balance at December 31, 2016	$	790		$	(226	)
Balance at January 1, 2015	$	776		$	(226	)
Total Gains (Losses)
Included in earnings - realized	—			—
Included in earnings - unrealized	—			—
Included in other comprehensive income	(7		)	—
Purchases, sales, issuances and settlements, other, net	—			—
Re-evaluation of fair value swap	—			—
Balance at December 31, 2015	$	769		$	(226	)

Schedule of assets and liabilities measured at fair value on a nonrecurring basis

Fair Value Measurements at December 31, 2016 Using:
(In thousands)	Level 1		Level 2		Level 3		Balance at December 31, 2016
Impaired Loans:
Commercial real estate	$	—	$	—	$	3,057	$	3,057
Construction real estate	—		—		541		541
Residential real estate	—		—		2,385		2,385
Total impaired loans	$	—	$	—	$	5,983	$	5,983
Mortgage Servicing Rights	$	—	$	6,769	$	—	$	6,769
Other Real Estate Owned:
Commercial real estate	—		—		2,644		2,644
Construction real estate	—		—		3,322		3,322
Residential real estate	—		—		931		931
Total Other Real Estate Owned	$	—	$	—	$	6,897	$	6,897

Fair Value Measurements at December 31, 2015 Using:
(In thousands)	Level 1		Level 2		Level 3		Balance at December 31, 2015
Impaired Loans:
Commercial real estate	$	—	$	—	$	3,698	$	3,698
Construction real estate:
SEPH commercial land and development	—		—		2,044		2,044
Remaining commercial	—		—		1,872		1,872
Residential real estate	—		—		1,882		1,882
Total impaired loans	$	—	$	—	$	9,496	$	9,496
Mortgage Servicing Rights	$	—	$	1,867	$	—	$	1,867
Other Real Estate Owned:
Commercial real estate	—		—		2,796		2,796
Construction real estate	—		—		3,387		3,387
Residential real estate	—		—		2,332		2,332
Total Other Real Estate Owned	$	—	$	—	$	8,515	$	8,515

Schedule of qualitative information about Level 3 fair value measurements for financial instruments measured at fair value on a non-recurring basis

The following tables present quantitative information about Level 3 fair value measurements for financial instruments measured at fair value on a non-recurring basis at December 31, 2016 and December 31, 2015:

December 31, 2016
(In thousands)	Fair Value		Valuation Technique	Unobservable Input(s)	Range (Weighted Average)
Impaired loans:
Commercial real estate	$	3,057	Sales comparison approach	Adj to comparables	0.0% - 90.0% (20.2%)
			Income approach	Capitalization rate	9.0% - 10.6% (10.1%)
			Cost approach	Accumulated depreciation	17.0% - 18.0% (17.8%)
Construction real estate	$	541	Sales comparison approach	Adj to comparables	0.0% - 11.1% (1.6%)
			Bulk sale approach	Discount rate	10.0% (10.0%)
Residential real estate	$	2,385	Sales comparison approach	Adj to comparables	0.3% - 110.0% (17.0%)
			Income approach	Capitalization rate	10.0% (10.0%)
Other real estate owned:
Commercial real estate	$	2,644	Sales comparison approach	Adj to comparables	0.0% - 68.4% (26.5%)
			Income approach	Capitalization rate	13.0% - 14.0% (13.1%)
Construction real estate	$	3,322	Sales comparison approach	Adj to comparables	0.0% - 90.0% (24.7%)
			Bulk sale approach	Discount rate	15.0% (15.0%)
Residential real estate	$	931	Sales comparison approach	Adj to comparables	3.2% - 79.7% (30.6%)

December 31, 2015
(In thousands)	Fair Value		Valuation Technique	Unobservable Input(s)	Range (Weighted Average)
Impaired loans:
Commercial real estate	$	3,698	Sales comparison approach	Adj to comparables	0.0% - 45.9% (20.3%)
			Income approach	Capitalization rate	7.0% - 13.3% (9.5%)
			Cost approach	Accumulated depreciation	50.0% (50.0%)
Construction real estate:
SEPH commercial land and development	$	2,044	Sales comparison approach	Adj to comparables	5.0% - 40.0% (22.1%)
			Bulk sale approach	Discount rate	10.7% (10.7%)
Remaining commercial	$	1,872	Sales comparison approach	Adj to comparables	0.0% - 25.3% (1.0%)
			Bulk sale approach	Discount rate	10.0% - 10.7% (10.0%)
Residential real estate	$	1,882	Sales comparison approach	Adj to comparables	0.0% - 96.7% (12.5%)
			Income approach	Capitalization rate	3.8% - 10.1% (9.1%)
			Cost approach	Accumulated depreciation	33.3% - 50.0% (43.4%)
Other real estate owned:
Commercial real estate	$	2,796	Sales comparison approach	Adj to comparables	2.0% - 71.0% (26.9%)
			Income approach	Capitalization rate	9.5% (9.5%)
Construction real estate	$	3,387	Sales comparison approach	Adj to comparables	0.0% - 85.0% (24.3%)
			Bulk sale approach	Discount rate	15.0% (15.0%)
Residential real estate	$	2,332	Sales comparison approach	Adj to comparables	0.1% - 61.8% (23.0%)

Fair value, by balance sheet grouping

The fair value of financial instruments at December 31, 2016 and December 31, 2015, was as follows:

	December 31, 2016
			Fair Value Measurements
(In thousands)	Carrying value		Level 1		Level 2		Level 3		Total fair value
Financial assets:
Cash and money market instruments	$	146,466	$	146,466	$	—	$	—	$	146,466
Investment securities	1,517,972		2,644		1,511,377		790		1,514,811
Accrued interest receivable - securities	3,849		—		3,849		—		3,849
Accrued interest receivable - loans	14,973		—		—		14,973		14,973
Mortgage loans held for sale	10,413		—		10,413		—		10,413
Impaired loans carried at fair value	5,983		—		—		5,983		5,983
Mortgage IRLCs	124		—		124		—		124
Other loans	5,204,713		—		—		5,161,919		5,161,919
Loans receivable, net	$	5,221,233	$	—	$	10,537	$	5,167,902	$	5,178,439
Financial liabilities:
Non-interest bearing checking accounts	$	1,523,417	$	1,523,417	$	—	$	—	$	1,523,417
Interest bearing transaction accounts	1,174,448		1,174,448		—		—		1,174,448
Savings accounts	1,704,920		1,704,920		—		—		1,704,920
Time deposits	1,117,870		—		1,122,598		—		1,122,598
Other	1,301		1,301		—		—		1,301
Total deposits	$	5,521,956	$	4,404,086	$	1,122,598	$	—	$	5,526,684
Short-term borrowings	$	394,795	$	—	$	394,795	$	—	$	394,795
Long-term debt	694,281		—		712,958		—		712,958
Subordinated notes	45,000		—		40,903		—		40,903
Accrued interest payable – deposits	900		82		818		—		900
Accrued interest payable – debt/borrowings	1,251		1		1,250		—		1,251
Derivative financial instruments:
Fair value swap	$	226	$	—	$	—	$	226	$	226

	December 31, 2015
			Fair Value Measurements
(In thousands)	Carrying value		Level 1		Level 2		Level 3		Total fair value
Financial assets:
Cash and money market instruments	$	149,459	$	149,459	$	—	$	—	$	149,459
Investment securities	1,585,568		1,941		1,584,984		769		1,587,694
Accrued interest receivable - securities	4,436		—		4,436		—		4,436
Accrued interest receivable - loans	14,239		—		—		14,239		14,239
Mortgage loans held for sale	7,306		—		7,306		—		7,306
Impaired loans carried at fair value	9,496		—		—		9,496		9,496
Mortgage IRLCs	165		—		165		—		165
Other loans	4,994,624		—		—		4,997,318		4,997,318
Loans receivable, net	$	5,011,591	$	—	$	7,471	$	5,006,814	$	5,014,285
Financial liabilities:
Non-interest bearing checking accounts	$	1,404,032	$	1,404,032	$	—	—		$	1,404,032
Interest bearing transaction accounts	1,107,200		1,107,200		—		—		1,107,200
Savings accounts	1,544,708		1,544,708		—		—		1,544,708
Time deposits	1,290,412		—		1,295,329		—		1,295,329
Other	1,290		1,290		—		—		1,290
Total deposits	$	5,347,642	$	4,057,230	$	1,295,329	$	—	$	5,352,559
Short-term borrowings	$	394,242	$	—	$	394,242	$	—	$	394,242
Long-term debt	738,105		—		771,420		—		771,420
Subordinated notes	45,000		—		41,596		—		41,596
Accrued interest payable – deposits	987		66		921		—		987
Accrued interest payable – debt/borrowings	1,351		4		1,347		—		1,351
Derivative financial instruments:
Fair value swap	$	226	$	—	$	—	$	226	$	226

Impaired Financing Receivables [Table Text Block]

	December 31, 2016
(In thousands)	Recorded Investment		Prior Charge-Offs		Specific Valuation Allowance		Carrying Balance
Impaired loans recorded at fair value	$	6,379	$	3,681	$	396	$	5,983
Remaining impaired loans	64,047		21,262		152		63,895
Total impaired loans	$	70,426	$	24,943	$	548	$	69,878

	December 31, 2015
(In thousands)	Recorded Investment		Prior Charge-Offs		Specific Valuation Allowance		Carrying Balance
Impaired loans recorded at fair value	$	11,783	$	10,512	$	2,287	$	9,496
Remaining impaired loans	68,881		18,193		1,904		66,977
Total impaired loans	$	80,664	$	28,705	$	4,191	$	76,473

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Capital Ratios (Tables)

12 Months Ended

Dec. 31, 2016

Capital [Abstract]

Schedule of compliance with regulatory capital requirements under banking regulations

The following table indicates the capital ratios for PNB and Park at December 31, 2016 and 2015.

	As of December 31, 2016
	Leverage		Tier 1 Risk-Based		Common Equity Tier 1		Total Risk-Based
The Park National Bank	7.34	%	9.87	%	9.87	%	11.24	%
Park National Corporation	9.56	%	12.83	%	12.55	%	14.32	%
Adequately capitalized ratio	4.00	%	6.00	%	4.50	%	8.00	%
Adequately capitalized ratio plus capital conservation buffer	4.00	%	8.50	%	7.00	%	10.50	%
Well-capitalized ratio (PNB only)	5.00	%	8.00	%	6.50	%	10.00	%

	As of December 31, 2015
	Leverage		Tier 1 Risk-Based		Common Equity Tier 1		Total Risk-Based
The Park National Bank	7.06	%	9.83	%	9.83	%	11.37	%
Park National Corporation	9.22	%	12.82	%	12.54	%	14.49	%
Adequately capitalized ratio	4.00	%	6.00	%	4.50	%	8.00	%
Adequately capitalized ratio plus capital conservation buffer	4.00	%	8.50	%	7.00	%	10.50	%
Well-capitalized ratio (PNB only)	5.00	%	8.00	%	6.50	%	10.00	%

Schedule of various measures of capital ratio

The following table reflects various measures of capital for Park and PNB:

					To Be Adequately Capitalized				To Be Well Capitalized
(In thousands)	Actual Amount		Ratio		Amount		Ratio		Amount		Ratio
At December 31, 2016
Total Risk-Based Capital (to risk-weighted assets)
PNB	$	607,269	11.24	%	$	432,153	8.00	%	$	540,192	10.00	%
Park	784,406		14.32	%	438,231		8.00	%	N/A		N/A
Tier 1 Risk-Based Capital (to risk-weighted assets)
PNB	$	533,215	9.87	%	$	324,115	6.00	%	$	432,153	8.00	%
Park	702,651		12.83	%	328,673		6.00	%	N/A		N/A
Leverage Ratio (to average total assets)
PNB	$	533,215	7.34	%	$	290,671	4.00	%	$	363,339	5.00	%
Park	702,651		9.56	%	293,916		4.00	%	N/A		N/A
Common Equity Tier 1 (to risk-weighted assets)
PNB	$	533,215	9.87	%	$	243,086	4.50	%	$	351,125	6.50	%
Park	687,651		12.55	%	246,505		4.50	%	N/A		N/A
At December 31, 2015
Total Risk-Based Capital (to risk-weighted assets)
PNB	$	588,467	11.37	%	$	414,079	8.00	%	$	517,599	10.00	%
Park	758,988		14.49	%	419,080		8.00	%	N/A		N/A
Tier 1 Risk-Based Capital (to risk-weighted assets)
PNB	$	508,763	9.83	%	$	310,560	6.00	%	$	414,079	8.00	%
Park	671,664		12.82	%	314,310		6.00	%	N/A		N/A
Leverage Ratio (to average total assets)
PNB	$	508,763	7.06	%	$	288,147	4.00	%	$	360,183	5.00	%
Park	671,664		9.22	%	291,449		4.00	%	N/A		N/A
Common Equity Tier 1 (to risk-weighted assets)
PNB	508,763		9.83	%	232,920		4.50	%	336,439		6.50	%
Park	656,664		12.54	%	235,732		4.50	%	N/A		N/A

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Segment Information (Tables)

12 Months Ended

Dec. 31, 2016

Segment Reporting [Abstract]

Schedule of operating results by Segment

Segment Information

The Corporation is a financial holding company headquartered in Newark, Ohio. The operating segments for the Corporation are its chartered national bank subsidiary, PNB (headquartered in Newark, Ohio), SEPH and GFSC.

GAAP requires management to disclose information about the different types of business activities in which a company engages and also information on the different economic environments in which a company operates, so that the users of the financial statements can better understand a company’s performance, better understand the potential for future cash flows, and make more informed judgments about the company as a whole. Park’s current operating segments are in line with GAAP as: (i) discrete financial information is available for each operating segment and (ii) the segments are aligned with internal reporting to Park’s Chief Executive Officer and President, who is the chief operating decision-maker.  

Operating results for the year ended December 31, 2016 (In thousands)
	PNB		GFSC			SEPH			All Other			Total
Net interest income (loss)	$	227,576	$	5,874		$	4,774		$	(138	)	$	238,086
Provision for (recovery of) loan losses	2,611		1,887			(9,599		)	—			(5,101		)
Other income (loss)	74,803		(1		)	2,974			955			78,731
Other expense	177,562		4,457			7,273			9,731			199,023
Income (loss) before taxes	122,206		(471		)	10,074			(8,914		)	122,895
Income taxes (benefit)	37,755		(164		)	3,526			(4,357		)	36,760
Net income (loss)	$	84,451	$	(307	)	$	6,548		$	(4,557	)	$	86,135
Balances at December 31, 2016
Assets	$	7,389,538	$	32,268		$	25,342		$	20,438		$	7,467,586
Loans	5,234,828		32,661			12,354			(7,986		)	5,271,857
Deposits	5,630,199		3,809			—			(112,052		)	5,521,956

Operating results for the year ended December 31, 2015 (In thousands)
	PNB		GFSC		SEPH			All Other			Total
Net interest income (loss)	$	220,879	$	6,588	$	(74	)	$	239		$	227,632
Provision for (recovery of) loan losses	7,665		1,415		(4,090		)	—			4,990
Other income	75,188		2		1,848			513			77,551
Other expense	167,476		2,984		6,182			9,972			186,614
Income (loss) before taxes	120,926		2,191		(318		)	(9,220		)	113,579
Income taxes (benefit)	36,581		768		(111		)	(4,671		)	32,567
Net income (loss)	$	84,345	$	1,423	$	(207	)	$	(4,549	)	$	81,012
Balances at December 31, 2015
Assets	$	7,229,764	$	35,793	$	33,541		$	12,256		$	7,311,354
Loans	5,029,072		35,469		15,153			(11,609		)	5,068,085
Deposits	5,447,293		4,627		—			(104,278		)	5,347,642

Operating results for the year ended December 31, 2014 (In thousands)
	PNB		GFSC			SEPH			All Other			Total
Net interest income (loss)	$	218,641	$	7,457		$	958		$	(2,012	)	$	225,044
Provision for (recovery of) loan losses	3,517		1,544			(12,394		)	—			(7,333		)
Other income (loss)	69,384		(1		)	5,991			175			75,549
Other expense	163,641		4,103			11,766			8,000			187,510
Income (loss) before taxes	120,867		1,809			7,577			(9,837		)	120,416
Income taxes (benefit)	37,960		634			2,652			(4,787		)	36,459
Net income (loss)	$	82,907	$	1,175		$	4,925		$	(5,050	)	$	83,957
Balances at December 31, 2014
Assets	$	6,910,386	$	40,308		$	43,762		$	6,743		$	7,001,199
Loans	4,781,761		40,645			23,956			(16,680		)	4,829,682
Deposits	5,222,766		5,883			—			(100,649		)	5,128,000

Schedule of reconciliation of financial information for the reportable segments to the Corporation’s consolidated totals

The following is a reconciliation of financial information for the reportable segments to the Corporation’s consolidated totals:

	2016
(In thousands)	Net Interest Income			Depreciation Expense		Other Expense		Income Taxes			Assets			Deposits
Totals for reportable segments	$	238,224		$	8,396	$	180,896	$	41,117		$	7,447,148		$	5,634,008
Elimination of intersegment items	2,164			—		—		—			(9,204		)	(112,052		)
Parent Co. totals - not eliminated	(2,302		)	—		9,731		(4,357		)	29,642			—
Totals	$	238,086		$	8,396	$	190,627	$	36,760		$	7,467,586		$	5,521,956

	2015
(In thousands)	Net Interest Income			Depreciation Expense		Other Expense		Income Taxes			Assets			Deposits
Totals for reportable segments	$	227,393		$	7,347	$	169,295	$	37,238		$	7,299,098		$	5,451,920
Elimination of intersegment items	2,561			—		—		—			(13,557		)	(104,278		)
Parent Co. totals - not eliminated	(2,322		)	—		9,972		(4,671		)	25,813			—
Totals	$	227,632		$	7,347	$	179,267	$	32,567		$	7,311,354		$	5,347,642

	2014
(In thousands)	Net Interest Income			Depreciation Expense		Other Expense		Income Taxes			Assets			Deposits
Totals for reportable segments	$	227,056		$	7,243	$	172,267	$	41,246		$	6,994,456		$	5,228,649
Elimination of intersegment items	3,708			—		—		—			(18,556		)	(100,649		)
Parent Co. totals - not eliminated	(5,720		)	—		8,000		(4,787		)	25,299			—
Totals	$	225,044		$	7,243	$	180,267	$	36,459		$	7,001,199		$	5,128,000

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Parent Company Statements (Tables)

12 Months Ended

Dec. 31, 2016

Condensed Financial Information of Parent Company Only Disclosure [Abstract]

Balance Sheets

Balance Sheets
December 31, 2016 and 2015
(In thousands)	2016		2015
Assets:
Cash	$	112,067	$	102,416
Investment in subsidiaries	626,569		613,383
Debentures receivable from PNB	25,000		25,000
Other investments	2,962		2,341
Other assets	26,651		23,443
Total assets	$	793,249	$	766,583
Liabilities:
Subordinated notes	45,000		45,000
Other liabilities	6,009		8,228
Total liabilities	51,009		53,228
Total shareholders’ equity	742,240		713,355
Total liabilities and shareholders’ equity	$	793,249	$	766,583

Statements of Income

Statements of Income
for the years ended December 31, 2016, 2015 and 2014
(In thousands)	2016			2015			2014
Income:
Dividends from subsidiaries	$	60,000		$	60,000		$	60,000
Interest and dividends	2,164			2,561			3,708
Other	1,081			560			262
Total income	63,245			63,121			63,970
Expense:
Other, net	12,159			12,341			13,807
Total expense	12,159			12,341			13,807
Income before federal taxes and equity in undistributed income of subsidiaries	51,086			50,780			50,163
Federal income tax benefit	4,357			4,671			4,787
Income before equity in undistributed income of subsidiaries	55,443			55,451			54,950
Equity in undistributed income of subsidiaries	30,692			25,561			29,007
Net income	$	86,135		$	81,012		$	83,957
Other comprehensive (loss) income (1)	(2,102		)	(2,035		)	21,811
Comprehensive income	84,033			78,977			105,768

Statements of Cash Flows

Statements of Cash Flows
for the years ended December 31, 2016, 2015 and 2014
(In thousands)	2016			2015			2014
Operating activities:
Net income	$	86,135		$	81,012		$	83,957
Adjustments to reconcile net income to net cash provided by operating activities:
Undistributed income of subsidiaries	(30,692		)	(25,561		)	(29,007		)
Compensation expense for issuance of treasury stock to directors	950			963			801
Share-based compensation expense	1,864			865			458
Increase in other assets	(3,425		)	(182		)	(1,292		)
(Decrease) increase in other liabilities	(2,524		)	485			298
Net cash provided by operating activities	52,308			57,582			55,215
Investing activities:
Repayment of investments in and advances to subsidiaries	15,000			10,000			32,000
Net cash provided by investing activities	15,000			10,000			32,000
Financing activities:
Cash dividends paid	(57,653		)	(57,776		)	(57,876		)
Repayment of subordinated notes	—			—			(35,250		)
Repurchase of treasury shares	—			(6,058		)	(2,355		)
Cash payment for fractional shares	(4		)	(3		)	(5		)
Net cash used in financing activities	(57,657		)	(63,837		)	(95,486		)
Increase (decrease) in cash	9,651			3,745			(8,271		)
Cash at beginning of year	102,416			98,671			106,942
Cash at end of year	$	112,067		$	102,416		$	98,671

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Summary of Significant Accounting Policies - Narrative (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015
Accounting Policies [Line Items]
Goodwill	$ 72,334	$ 72,334
Average required reserve balance	$ 51,600	$ 44,200
Historical loss period used in estimating loan loss reserve	84 months
Reserve coverage period in historical losses	1 year 11 months 12 days	1 year 11 months 26 days
Compensating Balance, Amount	$ 0
Commercial Loan
Accounting Policies [Line Items]
Reserve coverage period in historical losses	3 years 2 months 13 days	2 years 4 months 12 days
Consumer
Accounting Policies [Line Items]
Financing Receivable, Allowance for Credit Losses, Factors that Influenced Management's Judgment	0.0034	0.0042
Commercial Portfolio Segment [Member]
Accounting Policies [Line Items]
Financing Receivable, Allowance for Credit Losses, Factors that Influenced Management's Judgment	0.0039	0.0053

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Summary of Significant Accounting Policies - Depreciable Lives of Premises and Equipment (Details)	12 Months Ended
	Dec. 31, 2016
Minimum | Buildings
Property, Plant and Equipment [Line Items]
Premises and equipment, depreciable lives	30 years
Minimum | Equipment, furniture and fixtures
Property, Plant and Equipment [Line Items]
Premises and equipment, depreciable lives	3 years
Minimum | Leasehold improvements
Property, Plant and Equipment [Line Items]
Premises and equipment, depreciable lives	1 year
Maximum | Buildings
Property, Plant and Equipment [Line Items]
Premises and equipment, depreciable lives	30 years
Maximum | Equipment, furniture and fixtures
Property, Plant and Equipment [Line Items]
Premises and equipment, depreciable lives	12 years
Maximum | Leasehold improvements
Property, Plant and Equipment [Line Items]
Premises and equipment, depreciable lives	10 years

XML

Investment Securities - Narrative (Details) - USD ($)	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Schedule of Investments [Line Items]
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent	35.00%	35.00%	35.00%
Tax Equivalent Interest Adjustment	$ 1,400,000
Other than Temporary Impairment Losses, Investments	0	$ 0	$ 0
Amortized cost of securities available-for-sale	1,262,761,000	1,436,714,000
Securities held-to-maturity, at amortized cost (fair value of $256,672 and $151,428 at December 31, 2016 and 2015, respectively)	259,833,000	149,302,000
Federal home loan bank stock	50,100,000	50,086,000
Federal reserve bank stock	$ 8,200,000	8,226,000
Investment Securities average remaining life	4 years 5 months 2 days
Money pledged for government and trust department deposits	$ 343,000,000	429,000,000
Money pledged to secure repurchase agreements	569,000,000	622,000,000
Money Pledged as Collateral for FHLB Advance Borrowings	$ 25,000,000	21,000,000
Schedule of Repurchase Agreement Counterparties with Whom Repurchase Agreements Exceed 10 Percent of Stockholders' Equity [Table Text Block]	0
Percentage of amount greater than shareholder's equity	10.00%
Held-to-maturity Securities, Sold Security, Realized Gain (Loss)		88,000
Available-for-sale Securities, Gross Realized Gains			22,000
Available-for-sale Securities, Realized Losses, Excluding Other than Temporary Impairments		1,200,000
Equity investments	$ 3,500,000	0
Securities sold at a gain [Member]
Schedule of Investments [Line Items]
Amortized cost of securities available-for-sale			187,000
Securities held-to-maturity, at amortized cost (fair value of $256,672 and $151,428 at December 31, 2016 and 2015, respectively)		3,056,000
Securities sold at a loss [Member]
Schedule of Investments [Line Items]
Amortized cost of securities available-for-sale	$ 0		$ 174,100,000
U.S. Government sponsored entity asset-backed securities
Schedule of Investments [Line Items]
Asset-backed securities mortgage portfolio, maturity term	15 years
Amortized cost of securities available-for-sale	$ 991,642,000	907,989,000
Securities held-to-maturity, at amortized cost (fair value of $256,672 and $151,428 at December 31, 2016 and 2015, respectively)	71,211,000	$ 101,112,000
Residential mortgage-backed securities
Schedule of Investments [Line Items]
Amortized cost of securities available-for-sale	545,100,000
Securities held-to-maturity, at amortized cost (fair value of $256,672 and $151,428 at December 31, 2016 and 2015, respectively)	0
Collateralized mortgage-backed securities
Schedule of Investments [Line Items]
Amortized cost of securities available-for-sale	446,500,000
Securities held-to-maturity, at amortized cost (fair value of $256,672 and $151,428 at December 31, 2016 and 2015, respectively)	$ 71,200,000
Minimum | U.S. Treasury and sponsored entities callable notes
Schedule of Investments [Line Items]
Available for Sale Securities, Debt Maturities, Term	10 months 20 days
Maximum | U.S. Treasury and sponsored entities callable notes
Schedule of Investments [Line Items]
Available for Sale Securities, Debt Maturities, Term	3 years 6 months

XML

Investment Securities - Schedule of Investment Securities (Details) - USD ($) $ in Thousands	Dec. 31, 2016	Dec. 31, 2015
Securities Available-for-Sale
Amortized Cost	$ 1,262,761	$ 1,436,714
Gross Unrealized/Unrecognized Holding Gains	7,687	10,366
Available-for-sale Securities, Accumulated Gross Unrealized Loss, before Tax	12,309	10,814
Estimated Fair Value	1,258,139	1,436,266
Securities Held-to-Maturity
Securities held-to-maturity, at amortized cost (fair value of $256,672 and $151,428 at December 31, 2016 and 2015, respectively)	259,833	149,302
Gross Unrealized/Unrecognized Holding Gains	2,074	2,260
Gross Unrealized/Unrecognized Holding Losses	5,235	134
Estimated Fair Value	256,672	151,428
Obligations of U.S. Treasury and other U.S. Government sponsored entities
Securities Available-for-Sale
Amortized Cost	270,000	527,605
Available-for-sale Securities, Accumulated Gross Unrealized Loss, before Tax	2,467	5,542
Estimated Fair Value	267,533	522,063
Obligations of States and Political Subdivisions
Securities Held-to-Maturity
Securities held-to-maturity, at amortized cost (fair value of $256,672 and $151,428 at December 31, 2016 and 2015, respectively)	188,622	48,190
Gross Unrealized/Unrecognized Holding Gains	977	734
Gross Unrealized/Unrecognized Holding Losses	5,148
Estimated Fair Value	184,451	48,924
U.S. Government sponsored entity asset-backed securities
Securities Available-for-Sale
Amortized Cost	991,642	907,989
Gross Unrealized/Unrecognized Holding Gains	5,372	8,776
Available-for-sale Securities, Accumulated Gross Unrealized Loss, before Tax	9,842	5,272
Estimated Fair Value	987,172	911,493
Securities Held-to-Maturity
Securities held-to-maturity, at amortized cost (fair value of $256,672 and $151,428 at December 31, 2016 and 2015, respectively)	71,211	101,112
Gross Unrealized/Unrecognized Holding Gains	1,097	1,526
Gross Unrealized/Unrecognized Holding Losses	87	134
Estimated Fair Value	72,221	102,504
Equity securities
Securities Available-for-Sale
Amortized Cost	1,119	1,120
Gross Unrealized/Unrecognized Holding Gains	2,315	1,590
Estimated Fair Value	$ 3,434	$ 2,710

XML

Investment Securities - Schedule of Unrealized Loss on Securities (Details) - USD ($) $ in Thousands	Dec. 31, 2016	Dec. 31, 2015
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value [Abstract]
Less than 12 Months	$ 860,016	$ 711,142
12 Months or Longer	47,163	309,633
Total	907,179	1,020,775
Available-for-sale Securities, Continuous Unrealized Loss Position, Unrealized Losses [Abstract]
Less than 12 Months	11,778	4,893
12 Months or Longer	531	5,921
Total	12,309	10,814
Held-to-maturity Securities, Continuous Unrealized Loss Position, Fair Value [Abstract]
Less than 12 Months	134,909
12 Months or Longer	7,564
Total	142,473
Held-to-maturity Securities, Continuous Unrealized Loss Position, Unrealized Losses [Abstract]
Less than 12 Months	5,148
12 Months or Longer	87
Total	5,235
Obligations of U.S. Treasury and other U.S. Government sponsored entities
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value [Abstract]
Less than 12 Months	247,695	326,973
12 Months or Longer	19,838	195,090
Total	267,533	522,063
Available-for-sale Securities, Continuous Unrealized Loss Position, Unrealized Losses [Abstract]
Less than 12 Months	2,305	2,117
12 Months or Longer	162	3,425
Total	2,467	5,542
U.S. Government sponsored entity asset-backed securities
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value [Abstract]
Less than 12 Months	612,321	384,169
12 Months or Longer	27,325	114,543
Total	639,646	498,712
Available-for-sale Securities, Continuous Unrealized Loss Position, Unrealized Losses [Abstract]
Less than 12 Months	9,473	2,776
12 Months or Longer	369	2,496
Total	9,842	5,272
Held-to-maturity Securities, Continuous Unrealized Loss Position, Fair Value [Abstract]
Less than 12 Months		5,656
12 Months or Longer	7,564	7,792
Total	7,564	13,448
Held-to-maturity Securities, Continuous Unrealized Loss Position, Unrealized Losses [Abstract]
Less than 12 Months		10
12 Months or Longer	87	124
Total	87	$ 134
Obligations of States and Political Subdivisions
Held-to-maturity Securities, Continuous Unrealized Loss Position, Fair Value [Abstract]
Less than 12 Months	134,909
Total	134,909
Held-to-maturity Securities, Continuous Unrealized Loss Position, Unrealized Losses [Abstract]
Less than 12 Months	5,148
Total	$ 5,148

XML

Investment Securities - Amortized Cost and Estimated Fair Value of Investments in Debt Securities by Contractual Maturity (Details) - USD ($) $ in Thousands	Dec. 31, 2016	Dec. 31, 2015
Available-for-sale Securities, Debt Maturities, Estimated Fair Value [Abstract]
Estimated Fair Value	$ 1,258,139	$ 1,436,266
Held-to-maturity Securities, Debt Maturities, after Ten Years, Net Carrying Amount	188,622
Held-to-maturity Securities, Debt Maturities, after Ten Years, Fair Value	184,451
Held-to-maturity Securities, Debt Maturities, Amortized Cost [Abstract]
U.S. Government sponsored entities’ asset-backed securities	259,833	149,302
Obligations of U.S. Treasury and other U.S. Government sponsored entities
Schedule of Investments [Line Items]
Available-for-sale Securities, Debt Maturities, Next Twelve Months, Amortized Cost Basis	25,000
Available-for-sale Securities, Debt Maturities, Next Twelve Months, Fair Value	$ 24,933
Available for Sale Securities Debt Maturities next twelve months Weighted Avg Yield	0.87%
Available-for-sale Securities, Debt Maturities, Amortized Cost [Abstract]
Due one through five years	$ 245,000
Total	270,000
Available-for-sale Securities, Debt Maturities, Estimated Fair Value [Abstract]
Due one through five years	242,600
Estimated Fair Value	$ 267,533	522,063
Available for Sale Securities Weighted Avg Yield	1.18%
Available for Sale Securities Debt Maturities After One Through Five Years Weighted Avg Yield	1.22%
Obligations of States and Political Subdivisions
Available-for-sale Securities, Debt Maturities, Estimated Fair Value [Abstract]
Held-to-maturity Securities, Debt Maturities, after Ten Years, Net Carrying Amount	$ 188,622
Held-to-maturity Securities, Debt Maturities, after Ten Years, Fair Value	184,451
Held-to-maturity Securities, Debt Maturities, Amortized Cost [Abstract]
U.S. Government sponsored entities’ asset-backed securities	$ 188,622	48,190
Held-to-maturity Securities, Debt Maturities, Estimated Fair Value [Abstract]
Held to Maturity Securities weighted avg yield	4.50%
U.S. Government sponsored entity asset-backed securities
Available-for-sale Securities, Debt Maturities, Amortized Cost [Abstract]
Total	$ 991,642
Available-for-sale Securities, Debt Maturities, Estimated Fair Value [Abstract]
Estimated Fair Value	$ 987,172	911,493
Available for Sale Securities Weighted Avg Yield	2.10%
Held-to-maturity Securities, Debt Maturities, Amortized Cost [Abstract]
U.S. Government sponsored entities’ asset-backed securities	$ 71,211	$ 101,112
Held-to-maturity Securities, Debt Maturities, Estimated Fair Value [Abstract]
Held to Maturity Securities weighted avg yield	3.31%

XML

Loans - Narrative (Details) - USD ($)	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Financing Receivable, Recorded Investment [Line Items]
Loans and Leases Receivable, Deferred Income	$ 11,100,000	$ 10,400,000
Deposit Liabilities Reclassified as Loans Receivable	2,900,000	1,700,000
Troubled Debt Restructuring, Classification removed	2,700,000	1,200,000
Partial charge-offs on impaired loans	24,943,000	28,705,000
Allowance for loans individually evaluated for impairment	548,000	4,191,000
Recorded investment, related to loans	2,100,000	19,900,000
Loans 90 days past due and still accruing	2,138,000	1,975,000
financing receivable non accrual current	65,900,000	55,500,000
TDRs included in nonaccrual loan totals	46,900,000	41,100,000
Nonaccrual TDRs considered current	38,000,000	19,100,000
TDRs included in accruing loan totals	18,200,000	25,100,000
Commitments to lend additional funds to borrowers whose terms had been modified in a TDR	700,000	2,300,000
Specific reserves related to troubled debt restructuring	200,000	2,300,000
Additional specific reserves related to troubled debt restructuring	1,000,000	1,300,000	$ 700,000
Modified substandard commercial loans, total recorded investment	26,000	116,000
Modified substandard consumer loans total recorded investment	7,400,000	16,500,000
Nonaccrual loans not classified as TDRs at prior fiscal year end	9,400,000	800,000	700,000
Recorded investment modified as TDRs	3,798,000	2,854,000	2,009,000
Consumer
Financing Receivable, Recorded Investment [Line Items]
Allowance for loans individually evaluated for impairment	0	0
Loans 90 days past due and still accruing	1,139,000	1,093,000
Executive officers and directors
Financing Receivable, Recorded Investment [Line Items]
Loans due from related party	43,400,000	47,000,000
New loan made to related party	5,400,000	5,800,000
Repayment of loans due from related party	15,300,000	12,900,000
Increase (Decrease) in Customer Advances	3,500,000	7,100,000
Accruing
Financing Receivable, Recorded Investment [Line Items]
Recorded investment modified as TDRs	111,000	44,000	314,000
Nonaccrual
Financing Receivable, Recorded Investment [Line Items]
Recorded investment modified as TDRs	3,700,000	2,800,000	$ 1,700,000
Financing Receivable With No Related Allowance Recorded [Member]
Financing Receivable, Recorded Investment [Line Items]
Partial charge-offs on impaired loans	24,700,000	24,200,000
Financing Receivable With Related Allowance Recorded [Member]
Financing Receivable, Recorded Investment [Line Items]
Partial charge-offs on impaired loans	200,000	4,500,000
Loans receivable | Executive officers and directors
Financing Receivable, Recorded Investment [Line Items]
Loans due from related party	$ 29,600,000	$ 36,000,000

XML

Loans - Composition of Loan Portfolio By Class of Loan (Details) - USD ($) $ in Thousands		Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Financing Receivable, Recorded Investment [Line Items]
Impaired Financing Receivable, Unpaid Principal Balance		$ 95,358	$ 109,305
Impaired Financing Receivable, Recorded Investment		70,426	80,664	$ 73,712
Impaired Financing Receivable, Related Allowance		548	4,191
Loan Balance		5,271,857	5,068,085
Accrued Interest Receivable		14,973	14,239
Recorded Investment		5,286,830	5,082,324
Commercial, financial and agricultural
Financing Receivable, Recorded Investment [Line Items]
Impaired Financing Receivable, Recorded Investment		20,624	30,595	19,106
Loan Balance	[1]	994,619	955,727
Accrued Interest Receivable	[1]	3,558	3,437
Recorded Investment	[1]	998,177	959,164
Commercial real estate
Financing Receivable, Recorded Investment [Line Items]
Impaired Financing Receivable, Recorded Investment		24,474	18,025	21,989
Loan Balance	[1]	1,155,703	1,113,603
Accrued Interest Receivable	[1]	4,161	4,009
Recorded Investment	[1]	1,159,864	1,117,612
Construction real estate
Financing Receivable, Recorded Investment [Line Items]
Loan Balance		188,945	173,345
Recorded Investment		189,466	173,762
SEPH commercial land and development
Financing Receivable, Recorded Investment [Line Items]
Loan Balance	[1]	0	2,044
Accrued Interest Receivable	[1]	0	0
Recorded Investment	[1]	0	2,044
Remaining commercial
Financing Receivable, Recorded Investment [Line Items]
Impaired Financing Receivable, Recorded Investment		2,226	4,676	5,609
Loan Balance		135,343	128,046
Accrued Interest Receivable		398	321
Recorded Investment		135,741	128,367
Mortgage
Financing Receivable, Recorded Investment [Line Items]
Loan Balance		48,699	36,722
Accrued Interest Receivable		106	75
Recorded Investment		48,805	36,797
Installment
Financing Receivable, Recorded Investment [Line Items]
Loan Balance		4,903	6,533
Accrued Interest Receivable		17	21
Recorded Investment		4,920	6,554
Commercial
Financing Receivable, Recorded Investment [Line Items]
Impaired Financing Receivable, Recorded Investment		23,102	25,324	$ 24,930
Loan Balance		406,687	410,571
Accrued Interest Receivable		940	1,014
Recorded Investment		407,627	411,585
Mortgage
Financing Receivable, Recorded Investment [Line Items]
Loan Balance		1,169,495	1,210,819
Accrued Interest Receivable		1,459	1,469
Recorded Investment		1,170,954	1,212,288
HELOC
Financing Receivable, Recorded Investment [Line Items]
Loan Balance		212,441	211,415
Accrued Interest Receivable		853	769
Recorded Investment		213,294	212,184
Installment
Financing Receivable, Recorded Investment [Line Items]
Loan Balance		19,874	22,638
Accrued Interest Receivable		67	78
Recorded Investment		19,941	22,716
Consumer
Financing Receivable, Recorded Investment [Line Items]
Loan Balance		1,120,850	967,111
Accrued Interest Receivable		3,385	3,032
Recorded Investment		1,124,235	970,143
Leases
Financing Receivable, Recorded Investment [Line Items]
Loan Balance		3,243	2,856
Accrued Interest Receivable		29	14
Recorded Investment		3,272	2,870
Financing Receivable With No Related Allowance Recorded [Member] | Commercial, financial and agricultural
Financing Receivable, Recorded Investment [Line Items]
Impaired Financing Receivable, Unpaid Principal Balance		41,075	32,583
Impaired Financing Receivable, Recorded Investment		19,965	18,763
Financing Receivable With No Related Allowance Recorded [Member] | Commercial real estate
Financing Receivable, Recorded Investment [Line Items]
Impaired Financing Receivable, Unpaid Principal Balance		23,961	15,138
Impaired Financing Receivable, Recorded Investment		23,474	14,916
Financing Receivable With No Related Allowance Recorded [Member] | SEPH commercial land and development
Financing Receivable, Recorded Investment [Line Items]
Impaired Financing Receivable, Unpaid Principal Balance			10,834
Impaired Financing Receivable, Recorded Investment			2,044
Financing Receivable With No Related Allowance Recorded [Member] | Remaining commercial
Financing Receivable, Recorded Investment [Line Items]
Impaired Financing Receivable, Unpaid Principal Balance		3,662	2,506
Impaired Financing Receivable, Recorded Investment		2,226	1,531
Financing Receivable With No Related Allowance Recorded [Member] | Commercial
Financing Receivable, Recorded Investment [Line Items]
Impaired Financing Receivable, Unpaid Principal Balance		24,409	23,798
Impaired Financing Receivable, Recorded Investment		22,687	23,480
Financing Receivable With Related Allowance Recorded [Member] | Commercial, financial and agricultural
Financing Receivable, Recorded Investment [Line Items]
Impaired Financing Receivable, Unpaid Principal Balance		810	16,155
Impaired Financing Receivable, Recorded Investment		659	11,832
Impaired Financing Receivable, Related Allowance		152	1,904
Financing Receivable With Related Allowance Recorded [Member] | Commercial real estate
Financing Receivable, Recorded Investment [Line Items]
Impaired Financing Receivable, Unpaid Principal Balance		1,014	3,195
Impaired Financing Receivable, Recorded Investment		1,000	3,109
Impaired Financing Receivable, Related Allowance		309	381
Financing Receivable With Related Allowance Recorded [Member] | Remaining commercial
Financing Receivable, Recorded Investment [Line Items]
Impaired Financing Receivable, Unpaid Principal Balance			3,145
Impaired Financing Receivable, Recorded Investment			3,145
Impaired Financing Receivable, Related Allowance			1,356
Financing Receivable With Related Allowance Recorded [Member] | Commercial
Financing Receivable, Recorded Investment [Line Items]
Impaired Financing Receivable, Unpaid Principal Balance		427	1,951
Impaired Financing Receivable, Recorded Investment		415	1,844
Impaired Financing Receivable, Related Allowance		$ 87	$ 550

[1] Included within commercial, financial and agricultural loans and commercial real estate loans is an immaterial amount of consumer loans that were not broken out by class.

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Loans - Recorded Investment in Nonaccrual, Restructured and Loans Past Due 90 Days or More and Accruing (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Financing Receivable, Recorded Investment [Line Items]
Impaired Financing Receivable, Recorded Investment	$ 70,426	$ 80,664	$ 73,712
Nonaccrual Loans	87,822	95,887
Accruing Troubled Debt Restructurings	18,228	25,088
Loans Past Due 90 Days or More and Accruing	2,138	1,975
Total Nonperforming Loans	108,188	122,950
Impaired Financing Receivable, Average Recorded Investment	79,496	70,762	92,614
Impaired Financing Receivable, Interest Income, Cash Basis Method	4,777	1,963	2,678
Commercial, financial and agricultural
Financing Receivable, Recorded Investment [Line Items]
Impaired Financing Receivable, Recorded Investment	20,624	30,595	19,106
Nonaccrual Loans	20,057	21,676
Accruing Troubled Debt Restructurings	600	8,947
Loans Past Due 90 Days or More and Accruing	15	0
Total Nonperforming Loans	20,672	30,623
Impaired Financing Receivable, Average Recorded Investment	26,821	20,179	19,518
Impaired Financing Receivable, Interest Income, Cash Basis Method	885	340	360
Commercial real estate
Financing Receivable, Recorded Investment [Line Items]
Impaired Financing Receivable, Recorded Investment	24,474	18,025	21,989
Nonaccrual Loans	19,169	15,268
Accruing Troubled Debt Restructurings	5,305	2,757
Loans Past Due 90 Days or More and Accruing	0	0
Total Nonperforming Loans	24,474	18,025
Impaired Financing Receivable, Average Recorded Investment	22,828	17,883	31,945
Impaired Financing Receivable, Interest Income, Cash Basis Method	884	550	1,027
SEPH commercial land and development
Financing Receivable, Recorded Investment [Line Items]
Impaired Financing Receivable, Recorded Investment		2,044	2,078
Nonaccrual Loans	0	2,044
Accruing Troubled Debt Restructurings	0	0
Loans Past Due 90 Days or More and Accruing	0	0
Total Nonperforming Loans	0	2,044
Impaired Financing Receivable, Average Recorded Investment	1,597	2,066	3,658
Impaired Financing Receivable, Interest Income, Cash Basis Method		21	146
Remaining commercial
Financing Receivable, Recorded Investment [Line Items]
Impaired Financing Receivable, Recorded Investment	2,226	4,676	5,609
Nonaccrual Loans	1,833	4,162
Accruing Troubled Debt Restructurings	393	514
Loans Past Due 90 Days or More and Accruing	0	0
Total Nonperforming Loans	2,226	4,676
Impaired Financing Receivable, Average Recorded Investment	3,906	5,666	8,784
Impaired Financing Receivable, Interest Income, Cash Basis Method	66	26	61
Mortgage
Financing Receivable, Recorded Investment [Line Items]
Nonaccrual Loans	0	7
Accruing Troubled Debt Restructurings	104	110
Loans Past Due 90 Days or More and Accruing	0	0
Total Nonperforming Loans	104	117
Installment
Financing Receivable, Recorded Investment [Line Items]
Nonaccrual Loans	61	64
Accruing Troubled Debt Restructurings	95	114
Loans Past Due 90 Days or More and Accruing	12	0
Total Nonperforming Loans	168	178
Commercial
Financing Receivable, Recorded Investment [Line Items]
Impaired Financing Receivable, Recorded Investment	23,102	25,324	24,930
Nonaccrual Loans	23,013	25,063
Accruing Troubled Debt Restructurings	89	261
Loans Past Due 90 Days or More and Accruing	0	0
Total Nonperforming Loans	23,102	25,324
Impaired Financing Receivable, Average Recorded Investment	24,341	24,968	28,306
Impaired Financing Receivable, Interest Income, Cash Basis Method	2,942	1,026	1,084
Mortgage
Financing Receivable, Recorded Investment [Line Items]
Nonaccrual Loans	18,313	20,378
Accruing Troubled Debt Restructurings	9,612	10,143
Loans Past Due 90 Days or More and Accruing	887	851
Total Nonperforming Loans	28,812	31,372
HELOC
Financing Receivable, Recorded Investment [Line Items]
Nonaccrual Loans	1,783	1,749
Accruing Troubled Debt Restructurings	673	873
Loans Past Due 90 Days or More and Accruing	25	27
Total Nonperforming Loans	2,481	2,649
Installment
Financing Receivable, Recorded Investment [Line Items]
Nonaccrual Loans	644	1,657
Accruing Troubled Debt Restructurings	609	635
Loans Past Due 90 Days or More and Accruing	60	4
Total Nonperforming Loans	1,313	2,296
Consumer
Financing Receivable, Recorded Investment [Line Items]
Nonaccrual Loans	2,949	3,819
Accruing Troubled Debt Restructurings	748	734
Loans Past Due 90 Days or More and Accruing	1,139	1,093
Total Nonperforming Loans	4,836	$ 5,646
Impaired Financing Receivable, Average Recorded Investment	$ 3		$ 403

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Loans - Loans Individually and Collectively Evaluated for Impairment (Details) - USD ($) $ in Thousands	Dec. 31, 2016	Dec. 31, 2015
Financing Receivable, Recorded Investment [Line Items]
Nonaccrual and accruing TDRs	$ 106,050	$ 120,975
Loans individually evaluated for impairment	70,426	80,664
Loans collectively evaluated for impairment	35,624	40,311
Commercial, financial and agricultural
Financing Receivable, Recorded Investment [Line Items]
Nonaccrual and accruing TDRs	20,657	30,623
Loans individually evaluated for impairment	20,624	30,595
Loans collectively evaluated for impairment	33	28
Commercial real estate
Financing Receivable, Recorded Investment [Line Items]
Nonaccrual and accruing TDRs	24,474	18,025
Loans individually evaluated for impairment	24,474	18,025
Loans collectively evaluated for impairment	0	0
SEPH commercial land and development
Financing Receivable, Recorded Investment [Line Items]
Nonaccrual and accruing TDRs	0	2,044
Loans individually evaluated for impairment	0	2,044
Loans collectively evaluated for impairment	0	0
Remaining commercial
Financing Receivable, Recorded Investment [Line Items]
Nonaccrual and accruing TDRs	2,226	4,676
Loans individually evaluated for impairment	2,226	4,676
Loans collectively evaluated for impairment	0	0
Mortgage
Financing Receivable, Recorded Investment [Line Items]
Nonaccrual and accruing TDRs	104	117
Loans individually evaluated for impairment	0	0
Loans collectively evaluated for impairment	104	117
Installment
Financing Receivable, Recorded Investment [Line Items]
Nonaccrual and accruing TDRs	156	178
Loans individually evaluated for impairment	0	0
Loans collectively evaluated for impairment	156	178
Commercial
Financing Receivable, Recorded Investment [Line Items]
Nonaccrual and accruing TDRs	23,102	25,324
Loans individually evaluated for impairment	23,102	25,324
Loans collectively evaluated for impairment	0	0
Mortgage
Financing Receivable, Recorded Investment [Line Items]
Nonaccrual and accruing TDRs	27,925	30,521
Loans individually evaluated for impairment	0	0
Loans collectively evaluated for impairment	27,925	30,521
HELOC
Financing Receivable, Recorded Investment [Line Items]
Nonaccrual and accruing TDRs	2,456	2,622
Loans individually evaluated for impairment	0	0
Loans collectively evaluated for impairment	2,456	2,622
Installment
Financing Receivable, Recorded Investment [Line Items]
Nonaccrual and accruing TDRs	1,253	2,292
Loans individually evaluated for impairment	0	0
Loans collectively evaluated for impairment	1,253	2,292
Consumer
Financing Receivable, Recorded Investment [Line Items]
Nonaccrual and accruing TDRs	3,697	4,553
Loans individually evaluated for impairment	0	0
Loans collectively evaluated for impairment	$ 3,697	$ 4,553

XML

Loans - Loans Individually Evaluated for Impairment by Class of Loans (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Financing Receivable, Impaired [Line Items]
Unpaid principal balance	$ 95,358	$ 109,305
Recorded investment	70,426	80,664	$ 73,712
Allowance for loan losses allocated	548	4,191
Impaired Financing Receivable, Average Recorded Investment	79,496	70,762	92,614
Impaired Financing Receivable, Interest Income, Cash Basis Method	4,777	1,963	2,678
Commercial, financial and agricultural
Financing Receivable, Impaired [Line Items]
Recorded investment	20,624	30,595	19,106
Impaired Financing Receivable, Average Recorded Investment	26,821	20,179	19,518
Impaired Financing Receivable, Interest Income, Cash Basis Method	885	340	360
Commercial real estate
Financing Receivable, Impaired [Line Items]
Recorded investment	24,474	18,025	21,989
Impaired Financing Receivable, Average Recorded Investment	22,828	17,883	31,945
Impaired Financing Receivable, Interest Income, Cash Basis Method	884	550	1,027
Remaining commercial
Financing Receivable, Impaired [Line Items]
Recorded investment	2,226	4,676	5,609
Impaired Financing Receivable, Average Recorded Investment	3,906	5,666	8,784
Impaired Financing Receivable, Interest Income, Cash Basis Method	66	26	61
Commercial
Financing Receivable, Impaired [Line Items]
Recorded investment	23,102	25,324	24,930
Impaired Financing Receivable, Average Recorded Investment	24,341	24,968	28,306
Impaired Financing Receivable, Interest Income, Cash Basis Method	2,942	1,026	1,084
Consumer
Financing Receivable, Impaired [Line Items]
Impaired Financing Receivable, Average Recorded Investment	3		403
Construction Real Estate Vision Commercial Land And Development [Member]
Financing Receivable, Impaired [Line Items]
Recorded investment		2,044	2,078
Impaired Financing Receivable, Average Recorded Investment	1,597	2,066	3,658
Impaired Financing Receivable, Interest Income, Cash Basis Method		21	$ 146
With no related allowance recorded | Commercial, financial and agricultural
Financing Receivable, Impaired [Line Items]
Unpaid principal balance	41,075	32,583
Recorded investment	19,965	18,763
With no related allowance recorded | Commercial real estate
Financing Receivable, Impaired [Line Items]
Unpaid principal balance	23,961	15,138
Recorded investment	23,474	14,916
With no related allowance recorded | SEPH commercial land and development
Financing Receivable, Impaired [Line Items]
Unpaid principal balance		10,834
Recorded investment		2,044
With no related allowance recorded | Remaining commercial
Financing Receivable, Impaired [Line Items]
Unpaid principal balance	3,662	2,506
Recorded investment	2,226	1,531
With no related allowance recorded | Commercial
Financing Receivable, Impaired [Line Items]
Unpaid principal balance	24,409	23,798
Recorded investment	$ 22,687	$ 23,480

XML

Loans - Average Recorded Investment and Interest Income Recognized on Loans Individually Evaluated for Impairment (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Financing Receivable, Impaired [Line Items]
Recorded investment	$ 70,426	$ 80,664	$ 73,712
Average recorded investment	79,496	70,762	92,614
Interest income recognized	4,777	1,963	2,678
Commercial, financial and agricultural
Financing Receivable, Impaired [Line Items]
Recorded investment	20,624	30,595	19,106
Average recorded investment	26,821	20,179	19,518
Interest income recognized	885	340	360
Commercial real estate
Financing Receivable, Impaired [Line Items]
Recorded investment	24,474	18,025	21,989
Average recorded investment	22,828	17,883	31,945
Interest income recognized	884	550	1,027
SEPH commercial land and development
Financing Receivable, Impaired [Line Items]
Recorded investment		2,044	2,078
Average recorded investment	1,597	2,066	3,658
Interest income recognized		21	146
Remaining commercial
Financing Receivable, Impaired [Line Items]
Recorded investment	2,226	4,676	5,609
Average recorded investment	3,906	5,666	8,784
Interest income recognized	66	26	61
Commercial
Financing Receivable, Impaired [Line Items]
Recorded investment	23,102	25,324	24,930
Average recorded investment	24,341	24,968	28,306
Interest income recognized	2,942	$ 1,026	1,084
Consumer
Financing Receivable, Impaired [Line Items]
Average recorded investment	$ 3		$ 403

XML

Loans - Aging of Recorded Investment in Past Due Loans(Details) - USD ($) $ in Thousands		Dec. 31, 2016		Dec. 31, 2015
Financing Receivable, Recorded Investment, Past Due [Line Items]
Accruing loans past due 30-89 days		$ 26,591		$ 24,505
Past due, nonaccrual loans and loans past due 90 days or more and accruing (1)		24,050	[1]	42,383	[2]
Total past due		50,641		66,888
Total current (2)		5,236,189		5,015,436
Recorded Investment		5,286,830		5,082,324
Commercial, financial and agricultural
Financing Receivable, Recorded Investment, Past Due [Line Items]
Accruing loans past due 30-89 days		371		670
Past due, nonaccrual loans and loans past due 90 days or more and accruing (1)		4,113	[1]	7,536	[2]
Total past due		4,484		8,206
Total current (2)		993,693		950,958
Recorded Investment	[3]	998,177		959,164
Commercial real estate
Financing Receivable, Recorded Investment, Past Due [Line Items]
Accruing loans past due 30-89 days		355		142
Past due, nonaccrual loans and loans past due 90 days or more and accruing (1)		2,499	[1]	530	[2]
Total past due		2,854		672
Total current (2)		1,157,010		1,116,940
Recorded Investment	[3]	1,159,864		1,117,612
Construction real estate
Financing Receivable, Recorded Investment, Past Due [Line Items]
Recorded Investment		189,466		173,762
SEPH commercial land and development
Financing Receivable, Recorded Investment, Past Due [Line Items]
Past due, nonaccrual loans and loans past due 90 days or more and accruing (1)	[2]			2,044
Total past due				2,044
Recorded Investment				2,044
Remaining commercial
Financing Receivable, Recorded Investment, Past Due [Line Items]
Accruing loans past due 30-89 days				165
Past due, nonaccrual loans and loans past due 90 days or more and accruing (1)		541	[1]	84	[2]
Total past due		541		249
Total current (2)		135,200		128,118
Recorded Investment		135,741		128,367
Mortgage
Financing Receivable, Recorded Investment, Past Due [Line Items]
Accruing loans past due 30-89 days		559		63
Past due, nonaccrual loans and loans past due 90 days or more and accruing (1)	[2]			7
Total past due		559		70
Total current (2)		48,246		36,727
Recorded Investment		48,805		36,797
Installment
Financing Receivable, Recorded Investment, Past Due [Line Items]
Accruing loans past due 30-89 days		223		200
Past due, nonaccrual loans and loans past due 90 days or more and accruing (1)		64	[1]	46	[2]
Total past due		287		246
Total current (2)		4,633		6,308
Recorded Investment		4,920		6,554
Commercial
Financing Receivable, Recorded Investment, Past Due [Line Items]
Accruing loans past due 30-89 days		330		325
Past due, nonaccrual loans and loans past due 90 days or more and accruing (1)		3,631	[1]	19,521	[2]
Total past due		3,961		19,846
Total current (2)		403,666		391,739
Recorded Investment		407,627		411,585
Mortgage
Financing Receivable, Recorded Investment, Past Due [Line Items]
Accruing loans past due 30-89 days		10,854		10,569
Past due, nonaccrual loans and loans past due 90 days or more and accruing (1)		9,769	[1]	8,735	[2]
Total past due		20,623		19,304
Total current (2)		1,150,331		1,192,984
Recorded Investment		1,170,954		1,212,288
HELOC
Financing Receivable, Recorded Investment, Past Due [Line Items]
Accruing loans past due 30-89 days		970		487
Past due, nonaccrual loans and loans past due 90 days or more and accruing (1)		1,020	[1]	186	[2]
Total past due		1,990		673
Total current (2)		211,304		211,511
Recorded Investment		213,294		212,184
Installment
Financing Receivable, Recorded Investment, Past Due [Line Items]
Accruing loans past due 30-89 days		350		426
Past due, nonaccrual loans and loans past due 90 days or more and accruing (1)		319	[1]	318	[2]
Total past due		669		744
Total current (2)		19,272		21,972
Recorded Investment		19,941		22,716
Consumer
Financing Receivable, Recorded Investment, Past Due [Line Items]
Accruing loans past due 30-89 days		12,579		11,458
Past due, nonaccrual loans and loans past due 90 days or more and accruing (1)		2,094	[1]	3,376	[2]
Total past due		14,673		14,834
Total current (2)		1,109,562		955,309
Recorded Investment		1,124,235		970,143
Leases
Financing Receivable, Recorded Investment, Past Due [Line Items]
Total current (2)		3,272		2,870
Recorded Investment		$ 3,272		$ 2,870

[1] (1) Includes an aggregate of $2.1 million of loans past due 90 days or more and accruing. The remaining are past due, nonaccrual loans.(2) Includes an aggregate of $65.9 million of nonaccrual loans which are current in regards to contractual principal and interest payments.

[2] (1) Includes an aggregate of $2.0 million of loans past due 90 days or more and accruing. The remaining are past due, nonaccrual loans.(2) Includes an aggregate of $55.5 million of nonaccrual loans which are current in regards to contractual principal and interest payments.

[3] Included within commercial, financial and agricultural loans and commercial real estate loans is an immaterial amount of consumer loans that were not broken out by class.

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Loans - Recorded Investment by Loan Grade (Details) - USD ($) $ in Thousands	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Financing Receivable, Recorded Investment [Line Items]
Total loans	$ 5,271,857	$ 5,068,085	$ 4,829,682
Five Rated [Member] | Commercial, financial and agricultural
Financing Receivable, Recorded Investment [Line Items]
Total loans	5,826	4,392
Five Rated [Member] | Commercial real estate
Financing Receivable, Recorded Investment [Line Items]
Total loans	7,548	14,880
Five Rated [Member] | Remaining commercial
Financing Receivable, Recorded Investment [Line Items]
Total loans	287	2,151
Five Rated [Member] | Commercial
Financing Receivable, Recorded Investment [Line Items]
Total loans	1,055	3,280
Five Rated [Member] | Commercial Portfolio Segment [Member]
Financing Receivable, Recorded Investment [Line Items]
Total loans	14,716	24,703
Six Rated [Member] | Commercial, financial and agricultural
Financing Receivable, Recorded Investment [Line Items]
Total loans		347
Six Rated [Member] | Commercial real estate
Financing Receivable, Recorded Investment [Line Items]
Total loans	190	3,417
Six Rated [Member] | Remaining commercial
Financing Receivable, Recorded Investment [Line Items]
Total loans	118	122
Six Rated [Member] | Commercial
Financing Receivable, Recorded Investment [Line Items]
Total loans	124	386
Six Rated [Member] | Commercial Portfolio Segment [Member]
Financing Receivable, Recorded Investment [Line Items]
Total loans	432	4,272
Impaired [Member] | Commercial, financial and agricultural
Financing Receivable, Recorded Investment [Line Items]
Total loans	20,657	30,623
Impaired [Member] | Commercial real estate
Financing Receivable, Recorded Investment [Line Items]
Total loans	24,474	18,025
Impaired [Member] | SEPH commercial land and development
Financing Receivable, Recorded Investment [Line Items]
Total loans		2,044
Impaired [Member] | Remaining commercial
Financing Receivable, Recorded Investment [Line Items]
Total loans	2,226	4,676
Impaired [Member] | Commercial
Financing Receivable, Recorded Investment [Line Items]
Total loans	23,102	25,324
Impaired [Member] | Commercial Portfolio Segment [Member]
Financing Receivable, Recorded Investment [Line Items]
Total loans	70,459	80,692
Pass [Member] | Commercial, financial and agricultural
Financing Receivable, Recorded Investment [Line Items]
Total loans	971,694	923,802
Pass [Member] | Commercial real estate
Financing Receivable, Recorded Investment [Line Items]
Total loans	1,127,652	1,081,290
Pass [Member] | Remaining commercial
Financing Receivable, Recorded Investment [Line Items]
Total loans	133,110	121,418
Pass [Member] | Commercial
Financing Receivable, Recorded Investment [Line Items]
Total loans	383,346	382,595
Pass [Member] | Leases
Financing Receivable, Recorded Investment [Line Items]
Total loans	3,272	2,870
Pass [Member] | Commercial Portfolio Segment [Member]
Financing Receivable, Recorded Investment [Line Items]
Total loans	2,619,074	2,511,975
Recorded Investment [Member] | Commercial, financial and agricultural
Financing Receivable, Recorded Investment [Line Items]
Total loans	998,177	959,164
Recorded Investment [Member] | Commercial real estate
Financing Receivable, Recorded Investment [Line Items]
Total loans	1,159,864	1,117,612
Recorded Investment [Member] | SEPH commercial land and development
Financing Receivable, Recorded Investment [Line Items]
Total loans		2,044
Recorded Investment [Member] | Remaining commercial
Financing Receivable, Recorded Investment [Line Items]
Total loans	135,741	128,367
Recorded Investment [Member] | Commercial
Financing Receivable, Recorded Investment [Line Items]
Total loans	407,627	411,585
Recorded Investment [Member] | Leases
Financing Receivable, Recorded Investment [Line Items]
Total loans	3,272	2,870
Recorded Investment [Member] | Commercial Portfolio Segment [Member]
Financing Receivable, Recorded Investment [Line Items]
Total loans	$ 2,704,681	$ 2,621,642

XML

Loans - TDR Number of Contracts Modified And Recorded Investment (Details)	12 Months Ended
	Dec. 31, 2016 USD ($) contracts	Dec. 31, 2015 USD ($) contracts	Dec. 31, 2014 USD ($) contracts
Financing Receivable, Recorded Investment [Line Items]
Number of Contracts | contracts	97	67	86
Recorded Investment	$ 3,798,000	$ 2,854,000	$ 2,009,000
Number of Contracts | contracts	405	424	450
Total Recorded Investment Modified as TDRs During Period	$ 21,258,000	$ 23,324,000	$ 8,395,000
Leases
Financing Receivable, Recorded Investment [Line Items]
Number of Contracts | contracts	0	0	0
Recorded Investment	$ 0
Commercial, financial and agricultural
Financing Receivable, Recorded Investment [Line Items]
Number of Contracts | contracts	7	1	4
Recorded Investment	$ 419,000	$ 1,000	$ 206,000
Number of Contracts | contracts	32	39	30
Total Recorded Investment Modified as TDRs During Period	$ 8,641,000	$ 12,588,000	$ 723,000
Commercial real estate
Financing Receivable, Recorded Investment [Line Items]
Number of Contracts | contracts	5	1	1
Recorded Investment	$ 843,000	$ 626,000	$ 302,000
Number of Contracts | contracts	14	14	11
Total Recorded Investment Modified as TDRs During Period	$ 6,381,000	$ 4,160,000	$ 2,438,000
SEPH commercial land and development
Financing Receivable, Recorded Investment [Line Items]
Number of Contracts | contracts	0
SEPH commercial land and development
Financing Receivable, Recorded Investment [Line Items]
Number of Contracts | contracts	0	0	0
Number of Contracts | contracts		0	0
Remaining commercial
Financing Receivable, Recorded Investment [Line Items]
Number of Contracts | contracts	0	0	0
Number of Contracts | contracts	2	2	2
Total Recorded Investment Modified as TDRs During Period	$ 1,143,000	$ 513,000	$ 206,000
Mortgage
Financing Receivable, Recorded Investment [Line Items]
Number of Contracts | contracts	0	0	0
Recorded Investment	$ 0
Number of Contracts | contracts	0	1	0
Total Recorded Investment Modified as TDRs During Period		$ 19,000
Installment
Financing Receivable, Recorded Investment [Line Items]
Number of Contracts | contracts	0	0	0
Recorded Investment	$ 0
Number of Contracts | contracts	1	0	2
Total Recorded Investment Modified as TDRs During Period			$ 56,000
Commercial
Financing Receivable, Recorded Investment [Line Items]
Number of Contracts | contracts	7	3	1
Recorded Investment	$ 848,000	$ 1,005,000	$ 3,000
Number of Contracts | contracts	11	11	9
Total Recorded Investment Modified as TDRs During Period	$ 1,122,000	$ 1,185,000	$ 866,000
Mortgage
Financing Receivable, Recorded Investment [Line Items]
Number of Contracts | contracts	15	12	14
Recorded Investment	$ 1,201,000	$ 682,000	$ 810,000
Number of Contracts | contracts	34	39	46
Total Recorded Investment Modified as TDRs During Period	$ 2,406,000	$ 3,254,000	$ 2,357,000
HELOC
Financing Receivable, Recorded Investment [Line Items]
Number of Contracts | contracts	0	1	2
Recorded Investment		$ 5,000	$ 160,000
Number of Contracts | contracts	13	26	10
Total Recorded Investment Modified as TDRs During Period	$ 282,000	$ 360,000	$ 326,000
Installment
Financing Receivable, Recorded Investment [Line Items]
Number of Contracts | contracts	1	2	2
Recorded Investment	$ 3,000	$ 101,000	$ 12,000
Number of Contracts | contracts	5	9	10
Total Recorded Investment Modified as TDRs During Period	$ 105,000	$ 155,000	$ 121,000
Consumer
Financing Receivable, Recorded Investment [Line Items]
Number of Contracts | contracts	293	283	330
Total Recorded Investment Modified as TDRs During Period	$ 1,178,000	$ 1,090,000	$ 1,302,000
Accruing
Financing Receivable, Recorded Investment [Line Items]
Recorded Investment	111,000	44,000	314,000
Total Recorded Investment Modified as TDRs During Period	4,628,000	11,766,000	1,946,000
Accruing | Commercial, financial and agricultural
Financing Receivable, Recorded Investment [Line Items]
Total Recorded Investment Modified as TDRs During Period	191,000	8,948,000	292,000
Accruing | Commercial real estate
Financing Receivable, Recorded Investment [Line Items]
Total Recorded Investment Modified as TDRs During Period	3,844,000	637,000	1,184,000
Accruing | Remaining commercial
Financing Receivable, Recorded Investment [Line Items]
Total Recorded Investment Modified as TDRs During Period		513,000
Accruing | Mortgage
Financing Receivable, Recorded Investment [Line Items]
Total Recorded Investment Modified as TDRs During Period	0	19,000	0
Accruing | Installment
Financing Receivable, Recorded Investment [Line Items]
Total Recorded Investment Modified as TDRs During Period	0	0	0
Accruing | Commercial
Financing Receivable, Recorded Investment [Line Items]
Total Recorded Investment Modified as TDRs During Period	89,000
Accruing | Mortgage
Financing Receivable, Recorded Investment [Line Items]
Total Recorded Investment Modified as TDRs During Period	114,000	1,132,000	32,000
Accruing | HELOC
Financing Receivable, Recorded Investment [Line Items]
Total Recorded Investment Modified as TDRs During Period	104,000	315,000	85,000
Accruing | Installment
Financing Receivable, Recorded Investment [Line Items]
Total Recorded Investment Modified as TDRs During Period	102,000		109,000
Accruing | Consumer
Financing Receivable, Recorded Investment [Line Items]
Total Recorded Investment Modified as TDRs During Period	184,000	202,000	244,000
Nonaccrual
Financing Receivable, Recorded Investment [Line Items]
Recorded Investment	3,700,000	2,800,000	1,700,000
Total Recorded Investment Modified as TDRs During Period	16,630,000	11,558,000	6,449,000
Nonaccrual | Commercial, financial and agricultural
Financing Receivable, Recorded Investment [Line Items]
Total Recorded Investment Modified as TDRs During Period	8,450,000	3,640,000	431,000
Nonaccrual | Commercial real estate
Financing Receivable, Recorded Investment [Line Items]
Total Recorded Investment Modified as TDRs During Period	2,537,000	3,523,000	1,254,000
Nonaccrual | Remaining commercial
Financing Receivable, Recorded Investment [Line Items]
Total Recorded Investment Modified as TDRs During Period	1,143,000		206,000
Nonaccrual | Installment
Financing Receivable, Recorded Investment [Line Items]
Total Recorded Investment Modified as TDRs During Period			56,000
Nonaccrual | Commercial
Financing Receivable, Recorded Investment [Line Items]
Total Recorded Investment Modified as TDRs During Period	1,033,000	1,185,000	866,000
Nonaccrual | Mortgage
Financing Receivable, Recorded Investment [Line Items]
Total Recorded Investment Modified as TDRs During Period	2,292,000	2,122,000	2,325,000
Nonaccrual | HELOC
Financing Receivable, Recorded Investment [Line Items]
Total Recorded Investment Modified as TDRs During Period	178,000	45,000	241,000
Nonaccrual | Installment
Financing Receivable, Recorded Investment [Line Items]
Total Recorded Investment Modified as TDRs During Period	3,000	155,000	12,000
Nonaccrual | Consumer
Financing Receivable, Recorded Investment [Line Items]
Total Recorded Investment Modified as TDRs During Period	$ 994,000	$ 888,000	$ 1,058,000

XML

Loans - Recorded Investment in Financing Receivable Modified as TDR Within 12 Month (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2016 USD ($) contracts	Dec. 31, 2015 USD ($) contracts	Dec. 31, 2014 USD ($) contracts
Financing Receivable, Recorded Investment [Line Items]
Number of Contracts	97	67	86
Recorded Investment | $	$ 3,798	$ 2,854	$ 2,009
Commercial, financial and agricultural
Financing Receivable, Recorded Investment [Line Items]
Number of Contracts	7	1	4
Recorded Investment | $	$ 419	$ 1	$ 206
Commercial real estate
Financing Receivable, Recorded Investment [Line Items]
Number of Contracts	5	1	1
Recorded Investment | $	$ 843	$ 626	$ 302
SEPH commercial land and development
Financing Receivable, Recorded Investment [Line Items]
Number of Contracts	0	0	0
Remaining commercial
Financing Receivable, Recorded Investment [Line Items]
Number of Contracts	0	0	0
Mortgage
Financing Receivable, Recorded Investment [Line Items]
Number of Contracts	0	0	0
Recorded Investment | $	$ 0
Installment
Financing Receivable, Recorded Investment [Line Items]
Number of Contracts	0	0	0
Recorded Investment | $	$ 0
Commercial
Financing Receivable, Recorded Investment [Line Items]
Number of Contracts	7	3	1
Recorded Investment | $	$ 848	$ 1,005	$ 3
Mortgage
Financing Receivable, Recorded Investment [Line Items]
Number of Contracts	15	12	14
Recorded Investment | $	$ 1,201	$ 682	$ 810
HELOC
Financing Receivable, Recorded Investment [Line Items]
Number of Contracts	0	1	2
Recorded Investment | $		$ 5	$ 160
Installment
Financing Receivable, Recorded Investment [Line Items]
Number of Contracts	1	2	2
Recorded Investment | $	$ 3	$ 101	$ 12
Leases
Financing Receivable, Recorded Investment [Line Items]
Number of Contracts	62	47	62
Recorded Investment | $	$ 484	$ 434	$ 516

XML

Allowance for Loan Losses - Allowance Calculation at the Segment Level and Adjusted Beginning Balance for the Allowance for Credit Losses (Details) - USD ($) $ in Thousands	3 Months Ended	12 Months Ended
	Sep. 30, 2016	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Financing Receivable, Allowance for Credit Losses [Line Items]
Financing Receivable, Allowance for Credit Losses, Effect of Change in Method	$ 3,800
Allowance for Loan and Lease Losses, Reserve Estimate Methodology, Historical Loss Period Factor		84 months
Beginning balance		$ 56,494	$ 54,352
Charge-offs		20,799	14,290	$ 24,780
Recoveries		(20,030)	(11,442)	(26,997)
Net charge-offs (recoveries)		769	2,848	(2,217)
Provision (Recovery)		(5,101)	4,990	(7,333)
Ending balance		50,624	56,494	54,352
Commercial, financial and agricultural
Financing Receivable, Allowance for Credit Losses [Line Items]
Beginning balance		13,694	10,719
Charge-offs		5,786	2,478	3,779
Recoveries		(1,259)	(1,373)	(1,003)
Net charge-offs (recoveries)		4,527	1,105	2,776
Provision (Recovery)		4,267	4,080	(723)
Ending balance			13,694	10,719
Commercial real estate
Financing Receivable, Allowance for Credit Losses [Line Items]
Beginning balance		9,197	8,808
Charge-offs		412	348	8,003
Recoveries		(3,671)	(2,241)	(7,759)
Net charge-offs (recoveries)		(3,259)	(1,893)	244
Provision (Recovery)		(2,024)	(1,504)	(6,847)
Ending balance			9,197	8,808
Construction real estate
Financing Receivable, Allowance for Credit Losses [Line Items]
Beginning balance		8,564	8,652
Charge-offs		1,436	470	1,316
Recoveries		(8,559)	(2,092)	(12,572)
Net charge-offs (recoveries)		(7,123)	(1,622)	(11,256)
Provision (Recovery)		(10,440)	(1,710)	(9,459)
Ending balance			8,564	8,652
Residential real estate
Financing Receivable, Allowance for Credit Losses [Line Items]
Beginning balance		13,514	14,772
Charge-offs		3,014	2,352	3,944
Recoveries		(2,446)	(2,438)	(2,985)
Net charge-offs (recoveries)		568	(86)	959
Provision (Recovery)		(1,988)	(1,344)	1,480
Ending balance			13,514	14,772
Consumer
Financing Receivable, Allowance for Credit Losses [Line Items]
Beginning balance		11,524	11,401
Charge-offs		10,151	8,642	7,738
Recoveries		(4,094)	(3,295)	(2,671)
Net charge-offs (recoveries)		6,057	5,347	5,067
Provision (Recovery)		5,086	5,470	8,223
Ending balance			11,524	11,401
Leases
Financing Receivable, Allowance for Credit Losses [Line Items]
Beginning balance		1	0
Charge-offs		0	0	0
Recoveries		(1)	(3)	(7)
Net charge-offs (recoveries)		(1)	(3)	(7)
Provision (Recovery)		$ (2)	(2)	(7)
Ending balance			$ 1	$ 0

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Allowance for Loan Losses - Composition of the Allowance for Loan Losses (Details) - USD ($) $ in Thousands		12 Months Ended
		Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2012
Financing Receivable, Allowance for Credit Losses [Line Items]
Loans and Leases Receivable, Allowance		$ 50,624	$ 56,494	$ 54,352	$ 59,468
Ending allowance balance attributed to loans
Individually evaluated for impairment		548	4,191
Collectively evaluated for impairment		50,076	52,303
Total ending allowance balance		50,624	56,494
Loan Balance:
Loans individually evaluated for impairment		70,415	80,599
Loans collectively evaluated for impairment		5,201,442	4,987,486
Total ending loan balance		$ 5,271,857	$ 5,068,085
Allowance for loan losses as a percentage of loan balance:
Loans individually evaluated for impairment		0.78%	5.20%
Loans collectively evaluated for impairment		0.96%	1.05%
Total		0.96%	1.11%
Recorded Investment:
Loans individually evaluated for impairment		$ 70,426	$ 80,664
Loans collectively evaluated for impairment		5,216,404	5,001,660
Recorded Investment		5,286,830	5,082,324
Financing Receivable, Allowance for Credit Losses, Write-downs		20,799	14,290	24,780
Financing Receivable, Allowance for Credit Losses, Recovery		(20,030)	(11,442)	(26,997)
Financing Receivables Allowance For Credit Losses Net Charge Offs		769	2,848	(2,217)
Provision for Loan, Lease, and Other Losses		(5,101)	4,990	(7,333)
Commercial, financial and agricultural
Financing Receivable, Allowance for Credit Losses [Line Items]
Loans and Leases Receivable, Allowance			13,694	10,719	14,218
Ending allowance balance attributed to loans
Individually evaluated for impairment		152	1,904
Collectively evaluated for impairment		13,282	11,790
Total ending allowance balance		13,434	13,694
Loan Balance:
Loans individually evaluated for impairment		20,622	30,545
Loans collectively evaluated for impairment		973,997	925,182
Total ending loan balance	[1]	$ 994,619	$ 955,727
Allowance for loan losses as a percentage of loan balance:
Loans individually evaluated for impairment		0.74%	6.23%
Loans collectively evaluated for impairment		1.36%	1.27%
Total		1.35%	1.43%
Recorded Investment:
Loans individually evaluated for impairment		$ 20,624	$ 30,595
Loans collectively evaluated for impairment		977,553	928,569
Recorded Investment	[1]	998,177	959,164
Financing Receivable, Allowance for Credit Losses, Write-downs		5,786	2,478	3,779
Financing Receivable, Allowance for Credit Losses, Recovery		(1,259)	(1,373)	(1,003)
Financing Receivables Allowance For Credit Losses Net Charge Offs		4,527	1,105	2,776
Provision for Loan, Lease, and Other Losses		4,267	4,080	(723)
Commercial real estate
Financing Receivable, Allowance for Credit Losses [Line Items]
Loans and Leases Receivable, Allowance			9,197	8,808	15,899
Ending allowance balance attributed to loans
Individually evaluated for impairment		309	381
Collectively evaluated for impairment		10,123	8,816
Total ending allowance balance		10,432	9,197
Loan Balance:
Loans individually evaluated for impairment		24,465	18,015
Loans collectively evaluated for impairment		1,131,238	1,095,588
Total ending loan balance	[1]	$ 1,155,703	$ 1,113,603
Allowance for loan losses as a percentage of loan balance:
Loans individually evaluated for impairment		1.26%	2.11%
Loans collectively evaluated for impairment		0.89%	0.80%
Total		0.90%	0.83%
Recorded Investment:
Loans individually evaluated for impairment		$ 24,474	$ 18,025
Loans collectively evaluated for impairment		1,135,390	1,099,587
Recorded Investment	[1]	1,159,864	1,117,612
Financing Receivable, Allowance for Credit Losses, Write-downs		412	348	8,003
Financing Receivable, Allowance for Credit Losses, Recovery		(3,671)	(2,241)	(7,759)
Financing Receivables Allowance For Credit Losses Net Charge Offs		(3,259)	(1,893)	244
Provision for Loan, Lease, and Other Losses		(2,024)	(1,504)	(6,847)
Construction real estate
Financing Receivable, Allowance for Credit Losses [Line Items]
Loans and Leases Receivable, Allowance			8,564	8,652	6,855
Ending allowance balance attributed to loans
Individually evaluated for impairment		0	1,356
Collectively evaluated for impairment		5,247	7,208
Total ending allowance balance		5,247	8,564
Loan Balance:
Loans individually evaluated for impairment		2,226	6,716
Loans collectively evaluated for impairment		186,719	166,629
Total ending loan balance		$ 188,945	$ 173,345
Allowance for loan losses as a percentage of loan balance:
Loans individually evaluated for impairment		0.00%	20.19%
Loans collectively evaluated for impairment		2.81%	4.33%
Total		2.78%	4.94%
Recorded Investment:
Loans individually evaluated for impairment		$ 2,226	$ 6,720
Loans collectively evaluated for impairment		187,240	167,042
Recorded Investment		189,466	173,762
Financing Receivable, Allowance for Credit Losses, Write-downs		1,436	470	1,316
Financing Receivable, Allowance for Credit Losses, Recovery		(8,559)	(2,092)	(12,572)
Financing Receivables Allowance For Credit Losses Net Charge Offs		(7,123)	(1,622)	(11,256)
Provision for Loan, Lease, and Other Losses		(10,440)	(1,710)	(9,459)
Residential real estate
Financing Receivable, Allowance for Credit Losses [Line Items]
Loans and Leases Receivable, Allowance			13,514	14,772	14,251
Ending allowance balance attributed to loans
Individually evaluated for impairment		87	550
Collectively evaluated for impairment		10,871	12,964
Total ending allowance balance		10,958	13,514
Loan Balance:
Loans individually evaluated for impairment		23,102	25,323
Loans collectively evaluated for impairment		1,785,395	1,830,120
Total ending loan balance		$ 1,808,497	$ 1,855,443
Allowance for loan losses as a percentage of loan balance:
Loans individually evaluated for impairment		0.38%	2.17%
Loans collectively evaluated for impairment		0.61%	0.71%
Total		0.61%	0.73%
Recorded Investment:
Loans individually evaluated for impairment		$ 23,102	$ 25,324
Loans collectively evaluated for impairment		1,788,714	1,833,449
Recorded Investment		1,811,816	1,858,773
Financing Receivable, Allowance for Credit Losses, Write-downs		3,014	2,352	3,944
Financing Receivable, Allowance for Credit Losses, Recovery		(2,446)	(2,438)	(2,985)
Financing Receivables Allowance For Credit Losses Net Charge Offs		568	(86)	959
Provision for Loan, Lease, and Other Losses		(1,988)	(1,344)	1,480
Consumer
Financing Receivable, Allowance for Credit Losses [Line Items]
Loans and Leases Receivable, Allowance			11,524	11,401	8,245
Ending allowance balance attributed to loans
Individually evaluated for impairment		0	0
Collectively evaluated for impairment		10,553	11,524
Total ending allowance balance		10,553	11,524
Loan Balance:
Loans individually evaluated for impairment		0	0
Loans collectively evaluated for impairment		1,120,850	967,111
Total ending loan balance		$ 1,120,850	$ 967,111
Allowance for loan losses as a percentage of loan balance:
Loans individually evaluated for impairment		0.00%	0.00%
Loans collectively evaluated for impairment		0.94%	1.19%
Total		0.94%	1.19%
Recorded Investment:
Loans individually evaluated for impairment		$ 0	$ 0
Loans collectively evaluated for impairment		1,124,235	970,143
Recorded Investment		1,124,235	970,143
Financing Receivable, Allowance for Credit Losses, Write-downs		10,151	8,642	7,738
Financing Receivable, Allowance for Credit Losses, Recovery		(4,094)	(3,295)	(2,671)
Financing Receivables Allowance For Credit Losses Net Charge Offs		6,057	5,347	5,067
Provision for Loan, Lease, and Other Losses		5,086	5,470	8,223
Leases
Financing Receivable, Allowance for Credit Losses [Line Items]
Loans and Leases Receivable, Allowance			1	0	$ 0
Ending allowance balance attributed to loans
Individually evaluated for impairment		0	0
Collectively evaluated for impairment		0	1
Total ending allowance balance		0	1
Loan Balance:
Loans individually evaluated for impairment		0	0
Loans collectively evaluated for impairment		3,243	2,856
Total ending loan balance		$ 3,243	$ 2,856
Allowance for loan losses as a percentage of loan balance:
Loans individually evaluated for impairment		0.00%	0.00%
Loans collectively evaluated for impairment		0.00%	0.04%
Total		0.00%	0.04%
Recorded Investment:
Loans individually evaluated for impairment		$ 0	$ 0
Loans collectively evaluated for impairment		3,272	2,870
Recorded Investment		3,272	2,870
Financing Receivable, Allowance for Credit Losses, Write-downs		0	0	0
Financing Receivable, Allowance for Credit Losses, Recovery		(1)	(3)	(7)
Financing Receivables Allowance For Credit Losses Net Charge Offs		(1)	(3)	(7)
Provision for Loan, Lease, and Other Losses		$ (2)	$ (2)	$ (7)

[1] Included within commercial, financial and agricultural loans and commercial real estate loans is an immaterial amount of consumer loans that were not broken out by class.

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Loans Held for Sale Narrative (Details) - USD ($)	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Loans Held for Sale [Line Items]
Disposal Group, Including Discontinued Operation, Mortgage Loans	$ 10,413,000	$ 7,306,000
Loans Held-for-sale, Mortgages, Contractual Balance	10,300,000	7,200,000
Expected Gain (Loss) on Sale of Mortgage Loans	131,000	95,000
Commercial Portfolio Segment [Member]
Loans Held for Sale [Line Items]
Loans held for sale - lower of cost or market	$ 0	144,000	$ 22,000,000
Gain (Loss) on Sale of Loans and Leases		$ 800,000	$ 1,900,000

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Other Real Estate Owned (Details) - USD ($) $ in Thousands	Dec. 31, 2016	Dec. 31, 2015
Schedule of Assets Repossessed or Foreclosed, or loans in process of foreclosure [Line Items]
Other Real Estate, Foreclosed Assets, and Repossessed Assets	$ 13,926	$ 18,651
Construction real estate
Schedule of Assets Repossessed or Foreclosed, or loans in process of foreclosure [Line Items]
Other Real Estate, Foreclosed Assets, and Repossessed Assets	4,624	7,259
Commercial Real Estate [Member]
Schedule of Assets Repossessed or Foreclosed, or loans in process of foreclosure [Line Items]
Other Real Estate, Foreclosed Assets, and Repossessed Assets	7,642	8,333
Residential real estate
Schedule of Assets Repossessed or Foreclosed, or loans in process of foreclosure [Line Items]
Other Real Estate, Foreclosed Assets, and Repossessed Assets	1,660	3,059
Mortgage Loans in Process of Foreclosure, Amount	$ 3,250	$ 2,021

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Premises And Equipment - Narrative (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Property, Plant and Equipment [Abstract]
Depreciation and amortization expense	$ 8.4	$ 7.3	$ 7.2
Rent expense	$ 2.1	$ 1.7	$ 1.7

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Premises And Equipment - Major Categories of Premises and Equipment (Details) - USD ($) $ in Thousands	Dec. 31, 2016	Dec. 31, 2015
Property, Plant and Equipment [Line Items]
Premises and Equipment, Gross	$ 151,168	$ 145,365
Less accumulated depreciation	(93,197)	(85,872)
Premises and equipment, net	57,971	59,493
Land
Property, Plant and Equipment [Line Items]
Premises and Equipment, Gross	19,577	19,123
Buildings
Property, Plant and Equipment [Line Items]
Premises and Equipment, Gross	75,472	74,525
Equipment, furniture and fixtures
Property, Plant and Equipment [Line Items]
Premises and Equipment, Gross	52,719	47,839
Leasehold improvements
Property, Plant and Equipment [Line Items]
Premises and Equipment, Gross	$ 3,400	$ 3,878

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Premises And Equipment - Schedule of Future Minimum Rental Payments Under Operating Leases (Details) $ in Thousands	Dec. 31, 2016 USD ($)
Operating Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract]
2017	$ 1,508
2018	1,269
2019	1,178
2020	621
2021	422
Thereafter	700
Total	$ 5,698

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Investment in Qualified Affordable Housing (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Equity investments	$ 3,500	$ 0
Amortization Method Qualified Affordable Housing Project Investments, Amortization	7,300	6,700	$ 6,900
Affordable Housing Tax Credits and Other Tax Benefits, Amount	9,400	8,900	$ 8,800
Affordable Housing Program Obligation	14,282	20,311
Qualified Affordable Housing [Domain]
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Equity investments	$ 52,947	$ 51,247

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Deposits - Narrative (Details) - USD ($) $ in Millions	Dec. 31, 2016	Dec. 31, 2015
Deposits [Abstract]
Deposits received from executive officers, directors, and their related interests	$ 26.5	$ 21.6
Time Deposits, $250,000 or more	$ 43.3	$ 49.7

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Deposits - Summary of Noninterest Bearing and Interest Bearing Deposits (Details) - USD ($) $ in Thousands	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Deposits [Abstract]
Non-interest bearing	$ 1,523,417	$ 1,404,032
Interest bearing	3,998,539	3,943,610
Total deposits	$ 5,521,956	$ 5,347,642	$ 5,128,000

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Deposits - Time Deposits (Details) - USD ($) $ in Thousands	Dec. 31, 2016	Dec. 31, 2015
Deposits [Abstract]
Time Deposits, $250,000 or more	$ 43,300	$ 49,700
Time Deposits, Fiscal Year Maturity [Abstract]
2017	717,879
2018	131,236
2019	153,257
2020	63,758
2021	51,245
After 5 years	495
Total	$ 1,117,870

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Repurchase Agreements (Details) - USD ($) $ in Thousands	Dec. 31, 2016	Dec. 31, 2015	Nov. 30, 2012
Assets and Associated Liabilities of Transfers Accounted for as Secured Borrowings [Line Items]
ERROR in label resolution.	$ 640,000	$ 583,000
Pledged Assets Separately Reported, Securities Pledged for Repurchase Agreements, at Fair Value	569,000	622,000
Transfers Accounted for as Secured Borrowings, Associated Liabilities, Carrying Amount	509,795	554,242
Maturity Greater than 90 Days [Member]
Assets and Associated Liabilities of Transfers Accounted for as Secured Borrowings [Line Items]
Transfers Accounted for as Secured Borrowings, Associated Liabilities, Carrying Amount	301,104	304,385
Maturity 30 to 90 Days [Member]
Assets and Associated Liabilities of Transfers Accounted for as Secured Borrowings [Line Items]
Transfers Accounted for as Secured Borrowings, Associated Liabilities, Carrying Amount	0	0
Maturity Less than 30 Days [Member]
Assets and Associated Liabilities of Transfers Accounted for as Secured Borrowings [Line Items]
Transfers Accounted for as Secured Borrowings, Associated Liabilities, Carrying Amount	0	2,239
Maturity Overnight [Member]
Assets and Associated Liabilities of Transfers Accounted for as Secured Borrowings [Line Items]
Transfers Accounted for as Secured Borrowings, Associated Liabilities, Carrying Amount	$ 208,691	$ 247,618
Long-term Debt [Member]
Assets and Associated Liabilities of Transfers Accounted for as Secured Borrowings [Line Items]
Transfers Accounted for as Secured Borrowings, Associated Liabilities, Carrying Amount			$ 300,000

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Short-Term Borrowings - Narrative (Details) - USD ($) $ in Millions	Dec. 31, 2016	Dec. 31, 2015
Short-term Debt [Line Items]
Money Pledged as Collateral for FHLB Advance Borrowings	$ 25	$ 21
FHLB Advances
Short-term Debt [Line Items]
Commercial real estate and residential mortgage loans pledged under blanket agreement	$ 1,909	$ 1,985

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Short-Term Borrowings - Schedule of Short-Term Borrowings (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015
Short-term Debt [Line Items]
Securities sold under agreements to repurchase	$ 209,795	$ 254,242
FHLB advances	185,000	140,000
Total short-term borrowings	394,795	394,242
Repurchase agreements
Short-term Debt [Line Items]
Total short-term borrowings	209,795	254,242
Highest month-end balance	248,277	278,324
Average daily balance	$ 224,763	$ 257,622
Weighted-average interest rate:
As of year-end	0.17%	0.17%
Paid during the year	0.16%	0.18%
FHLB Advances
Short-term Debt [Line Items]
Total short-term borrowings	$ 185,000	$ 140,000
Highest month-end balance	185,000	140,000
Average daily balance	$ 15,694	$ 1,096
Weighted-average interest rate:
As of year-end	0.80%	0.56%
Paid during the year	0.63%	0.59%

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Long-Term Debt - Narrative (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014	Nov. 30, 2012
Debt Instrument [Line Items]
Prepayment penalty on long-term debt	$ 5,554	$ 532	$ 0
Gains (Losses) on Restructuring of Debt	5,600	500	3,200
Amortization of prepayment penalty on long term debt	6,176	6,047	5,031
Prepayment Penalty, Future Amortization Expense [Abstract]
Long-term debt with contractual maturity longer than five years	100,000	150,000
Money Pledged as Collateral for FHLB Advance Borrowings	25,000	21,000
FHLB Debt Prepaid	$ 50,000	$ 54,500
FHLB Debt Prepaid Weighted Avg Rate	3150.00%	1.59%
FHLB Debt Amount Restructured			$ 50,000
Broker Repurchase Agreements
Debt Instrument [Line Items]
Debt repurchased during period				$ 300,000
Debt repurchased during period, rate				1.75%
Prepayment penalty on long-term debt	$ 25,000
Effective interest rate percentage	3.55%
Prepayment Penalty, Future Amortization Expense [Abstract]
Payments of Debt Extinguishment Costs, Amount to be Amortized in Year Two	$ 4,700
Payments of Debt Extinguishment Costs, Amount to be Amortized in Year Three	$ 4,700
Federal Home Loan Bank Certificates and Obligations (FHLB) [Member]
Debt Instrument [Line Items]
Debt repurchased during period, rate				1.25%
Effective interest rate percentage	3.52%
Prepayment Penalty, Future Amortization Expense [Abstract]
Payments of Debt Extinguishment Costs, Amount to be Amortized in Year Two	$ 1,000
Payments of Debt Extinguishment Costs, Amount to be Amortized in Year Three	$ 1,000

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Long-Term Debt - Schedule of long-Term Debt (Details) - USD ($) $ in Thousands	Dec. 31, 2016	Dec. 31, 2015
Long-term Debt, Fiscal Year Maturity [Abstract]
2017	$ 350,000
2018	150,000	$ 350,000
2019	75,000	150,000
2020	25,000	75,000
2021	0	25,000
2021		0
Thereafter	100,000	150,000
Total long-term debt, excluding prepayment penalty	700,000	750,000
Prepayment penalty	(5,719)	(11,895)
Total long-term debt	$ 694,281	$ 738,105
Long-term Debt, Fiscal Year Maturity, Average Rate [Abstract] [Abstract]
2017	1.68%
2018	2.04%	1.68%
2019	1.96%	2.04%
2020	2.14%	1.96%
2021	0.00%	2.14%
2021		0.00%
Long-term Debt, Maturities, Repayments of Principal after Year Five	$ 100,000
Thereafter		3.32%
Average rate, total, excluding prepayment penalty	2.05%	2.12%
Average rate, total	2.07%	2.16%
Long Term Debt Maturities Average Rate In After Year Five	3.40%
FHLB Advances
Long-term Debt, Fiscal Year Maturity [Abstract]
2017	$ 50,000
2018	150,000	$ 50,000
2019	75,000	150,000
2020	25,000	75,000
2021	0	25,000
2021		0
Thereafter		150,000
Total long-term debt, excluding prepayment penalty	$ 400,000	$ 450,000
Long-term Debt, Fiscal Year Maturity, Average Rate [Abstract] [Abstract]
2017	1.25%
2018	2.04%	1.25%
2019	1.96%	2.04%
2020	2.14%	1.96%
2021	0.00%	2.14%
2021		0.00%
Long-term Debt, Maturities, Repayments of Principal after Year Five	$ 100,000
Thereafter		3.32%
Average rate, total, excluding prepayment penalty	2.27%	2.37%
Long Term Debt Maturities Average Rate In After Year Five	3.40%
Broker Repurchase Agreements
Long-term Debt, Fiscal Year Maturity [Abstract]
2019	$ 300,000
2020		$ 300,000
Total long-term debt, excluding prepayment penalty	$ 300,000	$ 300,000
Long-term Debt, Fiscal Year Maturity, Average Rate [Abstract] [Abstract]
2019	1.75%
2020		1.75%
Average rate, total, excluding prepayment penalty	1.75%	1.75%

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Subordinated Debentures/Notes (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2016 USD ($)	Dec. 31, 2015 USD ($)	Apr. 20, 2012 USD ($) purchaser	Dec. 23, 2009 purchaser
Subordinated notes	$ 45,000	$ 45,000
Number of purchasers | purchaser				38
Trust I
Preferred securities issued	15,000
Junior subordinated notes
Junior subordinated debt purchased by Trust I	$ 15,500
Trust preferred securities
Variable rate basis	three-month LIBOR plus 148 basis points
Basis spread on variable rate (percent)	1.48%
Subordinated note
Subordinated notes principal amount	$ 35,250
Portion of principal amount purchased by related parties	$ 14,050
Interest rate	10.00%
Subordinated debt | 7% Subordinated notes due April 20, 2022
Subordinated borrowing, number of purchasers | purchaser			56
Aggregate principal amount			$ 30,000
Interest rate	7.00%
Purchase price as a percentage of principal amount			100.00%
Repurchase amount as a percentage of principal			100.00%

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Contingent Liabilities (Details) $ in Millions	Dec. 31, 2016 USD ($)
Commitments and Contingencies Disclosure [Abstract]
Loss Contingency Accrual	$ 2.3

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Share-Based Compensation - Narrative (Details) - USD ($)	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number	85,425	44,700
Treasury Stock Reissued Shares For Director Grants	9,950	10,150	10,200
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost	$ 950,000	$ 963,000	$ 801,000
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period	0
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Forfeited in Period	825
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Forfeited in Period	1,125
Allocated Share-based Compensation Expense	$ 2,839,000
2013 Long Term Incentive Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common shares authorized for delivery upon the exercise of incentive stock options	600,000
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Period Increase (Decrease)	473,725
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross	41,550	23,025	21,975
Allocated Share-based Compensation Expense	$ 1,864,000	$ 865,000	$ 458,000
Common Shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Treasury Stock Reissued Shares For Director Grants	9,950	10,150	10,200
Allocated Share-based Compensation Expense	$ 1,864,000	$ 865,000	$ 458,000
Expense to be paid next twelve months [Domain]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Allocated Share-based Compensation Expense	1,193,000
Expense to be paid Year Two [Domain]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Allocated Share-based Compensation Expense	1,072,000
Expense to be paid Year Three [Domain]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Allocated Share-based Compensation Expense	491,000
Expense to be paid Year Four [Domain]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Allocated Share-based Compensation Expense	$ 83,000

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Benefit Plans - Narrative (Details) - USD ($)	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014	Nov. 17, 2009
Defined Benefit Plan Disclosure [Line Items]
Company contributions		$ 0	$ 0
Expected long-term rate of return on plan assets		7.00%	7.25%
Accumulated benefit obligation for the pension plan		$ 97,200,000	$ 86,100,000
Common share purchased under pension plan, shares					115,800
Common share purchased under pension plan, value					$ 7,000,000
Common share purchased under pension plan, value per share					$ 60.45
Fair value, pension plan common shares held, shares		115,800	115,800
Fair value of common shares held by pension plan		$ 13,900,000	$ 10,500,000
Fair value of common shares held by pension plan, per share		$ 119.66	$ 90.48
Estimated net actuarial (loss) expected to be recognized in the next fiscal year		$ (773,000)	$ (637,000)	$ 0
Expected long-term return on plan assets		7.25%	7.25%	7.25%
Cash balance in bank		$ 2,500,000
Market value of pension plan assets		167,000,000	$ 153,500,000
Equity investments		3,500,000	0
Defined Contribution Plan, Cost Recognized		1,300,000	1,200,000	$ 1,100,000
Pension Plans
Defined Benefit Plan Disclosure [Line Items]
Estimated prior service costs expected to be recognized in net periodic benefit cost during next fiscal year		0
Supplemental Executive Retirement Plan (SERP)
Defined Benefit Plan Disclosure [Line Items]
Benefit expense		1,500,000	1,100,000	$ 1,500,000
Accrued benefit cost		8,800,000	8,000,000
Level 1
Defined Benefit Plan Disclosure [Line Items]
Equity investments		149,200,000	135,000,000
Level 2
Defined Benefit Plan Disclosure [Line Items]
Equity investments		17,800,000	18,500,000
Level 3
Defined Benefit Plan Disclosure [Line Items]
Equity investments		$ 0	$ 0
Scenario, Forecast [Member]
Defined Benefit Plan Disclosure [Line Items]
Estimated net actuarial (loss) expected to be recognized in the next fiscal year	$ 576,000

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Benefit Plans - Plan Assets and Benefit Obligation Activity (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Change in fair value of plan assets
Fair value at beginning of measurement period	$ 153,498	$ 160,598
Actual return on plan assets	19,256	(58)
Benefits paid	(5,707)	(7,042)
Fair value at end of measurement period	167,047	153,498	$ 160,598
Change in benefit obligation
Projected benefit obligation at beginning of measurement period	102,245	109,328
Service cost	5,055	5,368	4,331
Interest cost	4,869	4,695	4,577
Actuarial loss (gains)	7,993	(10,104)
Benefits paid	(5,707)	(7,042)
Projected benefit obligation at the end of measurement period	114,455	102,245	$ 109,328
Funded status at end of year (fair value of plan assets less benefit obligation)	$ 52,592	$ 51,253

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Benefit Plans - Asset Allocation for the Pension Plan by Asset Category (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Contributions by Employer	$ 0	$ 0
Defined Benefit Plan, Information about Plan Assets [Abstract]
Actual Plan Asset Allocations	100.00%	100.00%
Defined Benefit Plan, Expected Return on Plan Assets, Percentage	7.00%	7.25%
Equity securities
Defined Benefit Plan, Information about Plan Assets [Abstract]
Actual Plan Asset Allocations	84.00%	85.00%
Fixed income and cash equivalents
Defined Benefit Plan, Information about Plan Assets [Abstract]
Actual Plan Asset Allocations	16.00%	15.00%

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Benefit Plans - Weighted Average Assumptions Used to Determine Benefit Obligations (Details)	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Defined Benefit Plan, Weighted Average Assumptions Used in Calculating Benefit Obligation [Abstract]
Discount rate	4.58%	4.88%	4.42%
Rate of compensation increase
Ages 50 and over [Member]
Defined Benefit Plan, Weighted Average Assumptions Used in Calculating Benefit Obligation [Abstract]
Rate of compensation increase	3000.00%	3000.00%	3000.00%
Ages 40-49 [Domain]
Defined Benefit Plan, Weighted Average Assumptions Used in Calculating Benefit Obligation [Abstract]
Rate of compensation increase	4.00%	3.00%	3.00%
Ages 30-39 [Member] [Member]
Defined Benefit Plan, Weighted Average Assumptions Used in Calculating Benefit Obligation [Abstract]
Rate of compensation increase	6.00%	6.00%	6.00%
Under age 30 [Member]
Defined Benefit Plan, Weighted Average Assumptions Used in Calculating Benefit Obligation [Abstract]
Rate of compensation increase	10.00%	10.00%	10.00%

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Benefit Plans - Estimated Future Pension Benefit Payments (Details) $ in Thousands	Dec. 31, 2016 USD ($)
Defined Benefit Plan, Expected Future Benefit Payments, Fiscal Year Maturity [Abstract]
2017	$ 6,924
2018	7,644
2019	7,875
2020	8,393
2021	9,503
2022-2026	48,058
Total	$ 88,397

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Benefit Plans - Balances of Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015
Defined Benefit Plan, Amounts Recognized in Other Comprehensive Income (Loss) [Abstract]
Prior service cost	$ 0	$ 0
Net actuarial loss	(22,677)	(23,618)
Total	(22,677)	(23,618)
Deferred taxes	(7,937)	(8,267)
Accumulated other comprehensive loss	$ (14,740)	$ (15,351)

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Benefit Plans - Components of Net Periodic Benefit Cost and Other Amounts Recognized in Other Comprehensive Income (Loss) (Details) - USD ($)	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Components of net periodic benefit cost
Service cost	$ (5,055,000)	$ (5,368,000)	$ (4,331,000)
Interest cost	(4,869,000)	(4,695,000)	(4,577,000)
Expected return on plan assets	10,950,000	11,420,000	10,869,000
Net periodic benefit income	(253,000)	(705,000)	(1,942,000)
Other amounts recognized in other comprehensive (Loss)
Change to net actuarial gain (loss) for the period	168,000	(1,400,000)	(14,276,000)
Amortization of prior service cost	0	(15,000)	(19,000)
Defined Benefit Plan, Future Amortization of Gain (Loss)	(773,000)	(637,000)	0
Amortization of net loss	773,000	637,000	0
Total recognized in other comprehensive income (loss)	941,000	(748,000)	(14,257,000)
Total recognized in net benefit cost and other comprehensive income (loss)	$ 1,194,000	$ (43,000)	$ (12,315,000)

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Benefit Plans - Weighted Average Assumptions Used to Determine Net Periodic Benefit Cost (Details)	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Defined Benefit Plan Disclosure [Line Items]
Rate of compensation increase
Expected long-term return on plan assets	7.25%	7.25%	7.25%
Discount Rate	4.88%	4.42%	5.30%
Ages 30-39 [Member] [Member]
Defined Benefit Plan Disclosure [Line Items]
Rate of compensation increase	6.00%	6.00%	6.00%
Under age 30 [Member]
Defined Benefit Plan Disclosure [Line Items]
Rate of compensation increase	10.00%	10.00%	10.00%
Ages 40 and over [Member]
Defined Benefit Plan Disclosure [Line Items]
Rate of compensation increase	3.00%	3.00%	3.00%

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Income Taxes - Components of Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands	Dec. 31, 2016	Dec. 31, 2015
Deferred tax assets:
Allowance for loan losses	$ 17,719	$ 19,773
Accumulated other comprehensive loss – Pension Plan	7,937	8,266
Accumulated other comprehensive loss – Unrealized losses on securities	1,618	157
Deferred compensation	4,140	3,908
OREO valuation adjustments	2,322	2,418
Net deferred loan fees	1,397	1,204
Deferred contract bonus	1,074	1,031
Nonvested PBRSUs	1,115	463
Fixed assets	781	413
Deferred Tax Assets, Tax Deferred Expense, Reserves and Accruals, Legal Settlements	793	482
Other	2,525	2,813
Total deferred tax assets	41,421	40,928
Deferred tax liabilities:
Deferred investment income	10,199	10,199
Pension plan	26,344	26,205
Mortgage servicing rights	3,243	3,153
Partnership adjustments	549	560
Other	596	872
Total deferred tax liabilities	40,931	40,989
Deferred Tax Assets, Net	$ 490
Net deferred tax asset (liability)		$ 61

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Income Taxes - Components of the Provision for Federal and State Income Taxes (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Currently payable
Federal	$ 28,879	$ 26,153	$ 27,062
Other Tax Expense (Benefit)	7,300	6,664	6,869
Deferred
Federal	581	(250)	2,528
Total	$ 36,760	$ 32,567	$ 36,459

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Income Taxes - Reconciliation of Federal Income Tax Expense (Details) - USD ($)	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Income Tax Disclosure [Abstract]
Income Tax Examination, Penalties and Interest Expense	$ 1,500		$ 0
Effective Income Tax Rate, Continuing Operations, Tax Rate Reconciliation [Abstract]
Statutory federal corporate tax rate	35.00%	35.00%	35.00%
Changes in rates resulting from:
Tax exempt interest income, net of disallowed interest	(1.30%)	(0.50%)	(0.50%)
Bank owned life insurance	(1.20%)	(1.80%)	(1.40%)
Effective Income Tax Rate Reconciliation, Investment in Qualified Affordable Housing, Percent	(1.70%)	(1.90%)	(1.60%)
Investments in qualified affordable housing projects, net of tax benefits	(0.00%)	(0.90%)	(0.00%)
Effective Income Tax Rate Reconciliation, Deduction, Employee Stock Ownership Plan Dividend, Percent	(1.00%)	(1.00%)	(1.00%)
Other	0.10%	(0.20%)	(0.20%)
Effective tax rate	29.90%	28.70%	30.30%

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Income Taxes - Reconciliation of the Beginning and Ending Amount of Unrecognized Tax Benefits (Details) - USD ($)	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Income Tax Disclosure [Abstract]
Unrecognized Tax Benefits that Would Impact Effective Tax Rate	$ 482,000	$ 432,000	$ 413,000
Income Tax Examination, Penalties and Interest Expense	1,500		0
Reconciliation of Unrecognized Tax Benefits [Roll Forward]
January 1 Balance	558,000	532,000	518,000
Additions based on tax positions related to the current year	117,000	80,000	76,000
Additions for tax positions of prior years	38,000	16,000	14,000
Reductions for tax positions of prior years	0	0	0
Reductions due to statute of limitations	(80,000)	(70,000)	(76,000)
December 31 Balance	633,000	558,000	532,000
Income Tax Examination, Penalties and Interest Accrued	$ 70,500	$ 69,000	$ 67,000

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Other Comprehensive Income (Loss) - Components of Other Comprehensive Income (Loss) (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Accumulated Other Comprehensive Income (Loss) [Line Items]
Other Comprehensive (Income) Loss, Amortization Adjustment from AOCI, Pension and Other Postretirement Benefit Plans, for Net Prior Service Cost (Credit), before Tax	$ 0	$ 15	$ 19
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI, Pension and Other Postretirement Benefit Plans, for Net Gain (Loss), before Tax	773	637	0
Other Comprehensive (Income) Loss, Reclassification Adjustment from AOCI, Pension and Other Postretirement Benefit Plans, before Tax	773	652	19
Other Comprehensive (Income) Loss, Reclassification Adjustment from AOCI, Pension and Other Postretirement Benefit Plans, Tax	271	228	7
Accumulated Other Comprehensive Income (Loss), Pension and Other Postretirement Benefit Plans, Net of Tax	14,740	15,351	14,865	$ 5,598
Accumulated Other Comprehensive Income (Loss), Available-for-sale Securities Adjustment, Net of Tax	(3,005)	(292)	1,257	(29,821)
Accumulated Other Comprehensive Income (Loss), Net of Tax	(17,745)	(15,643)	(13,608)	$ (35,419)
Other Comprehensive (Income) Loss, Pension and Other Postretirement Benefit Plans, Adjustment, Net of Tax	611	(486)	(9,267)
Other Comprehensive Income (Loss), Available-for-sale Securities Adjustment, Net of Tax	(2,713)	(1,549)	31,078
Other Comprehensive (Income) Loss, Pension and Other Postretirement Benefit Plans, Adjustment, before Reclassification Adjustments, Net of Tax	109	(910)	(9,279)
Other Comprehensive Income (Loss), Available-for-sale Securities Adjustment, before Reclassification Adjustments, Net of Tax	(2,713)	(1,549)	30,325
Other Comprehensive Income (Loss), before Reclassifications, Net of Tax	(2,604)	(2,459)	21,046
Other Comprehensive (Income) Loss, Reclassification Adjustment from AOCI, Pension and Other Postretirement Benefit Plans, Net of Tax	502	424	12
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax	502	424	765
Other Comprehensive Income (Loss), Net of Tax	(2,102)	(2,035)	21,811
Gain (Loss) on Sale of Investments	0	0	1,158
Other than Temporary Impairment Losses, Investments	0	0	0
Other Comprehensive Income (Loss), Available-for-sale Securities Adjustment, before Tax	0	0	1,158
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI for Sale of Securities, Tax	0	0	405
Available-for-sale Securities [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax	$ 0	$ 0	$ 753

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Earnings Per Common Share - Summary of Computation of Basic and Diluted Earnings Per Common Share (Details) - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Net Income (Loss) Available to Common Stockholders, Basic [Abstract]
Net income available to common shareholders	$ 86,135	$ 81,012	$ 83,957
Denominator:
Weighted-average common shares outstanding	15,332,553	15,364,281	15,394,971
Effect of dilutive performance-based restricted stock units	72,607	40,459	18,861
Earnings per common share:	15,405,160	15,404,740	15,413,832
Earnings per common share:
Basic earnings per common share	$ 5.62	$ 5.27	$ 5.45
Diluted earnings per common share	$ 5.59	$ 5.26	$ 5.45

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Earnings Per Common Share - Narrative (Details) - shares	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Class of Warrant or Right [Line Items]
Weighted Average Number Diluted Shares Outstanding Adjustment	72,607	40,459	18,861
2013 Long Term Incentive Plan [Member]
Class of Warrant or Right [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross	41,550	23,025	21,975
Common Shares
Class of Warrant or Right [Line Items]
Treasury Stock, Shares, Acquired	0	71,700	29,700

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Dividend Restrictions (Details) $ in Millions	Dec. 31, 2016 USD ($)
Disclosure of Restrictions on Dividends, Loans and Advances Disclosure [Abstract]
Amount available for dividend distribution without prior approval from regulatory authority	$ 71.7

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Financial Instruments With Off-Balance Sheet Risk And Financial Instruments With Concentrations Of Credit Risk (Details) - USD ($) $ in Thousands	Dec. 31, 2016	Dec. 31, 2015
Risks and Uncertainties [Abstract]
Loan commitments	$ 912,007	$ 888,411
Standby letters of credit	$ 13,746	$ 12,326

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Loan Servicing - Narrative (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Servicing Assets at Fair Value [Line Items]
Mortgage Servicing Rights Fair Value	$ 9,299	$ 9,593
Transfers and Servicing of Financial Assets [Abstract]
Serviced sold mortgage loans	1,330,000	1,276,000	$ 1,265,000
Serviced sold mortgage loans with recourse	4,100	5,400	7,000
Mortgage loans sold with recourse, reserve	$ 266	$ 500
Mortgage servicing rights, discount rate	13.00%	10.00%
Servicing fees included in other service income	$ 3,400	$ 3,400	$ 3,500
Minimum
Transfers and Servicing of Financial Assets [Abstract]
Mortgage servicing rights, constant prepayment speeds	6.20%	6.30%
Maximum
Transfers and Servicing of Financial Assets [Abstract]
Mortgage servicing rights, constant prepayment speeds	16.80%	22.00%

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Loan Servicing - Activity for MSRs And Related Valuation Allowance (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Mortgage servicing rights:
Carrying amount, net, beginning of year	$ 9,008	$ 8,613	$ 9,013
Additions	2,286	1,748	1,026
Amortization	(1,835)	(1,637)	(1,631)
Change in valuation allowance	(193)	284	205
Carrying amount, net, end of year	9,266	9,008	8,613
Valuation allowance:
Beginning of year	542	826	1,031
Change in valuation allowance	193	(284)	(205)
End of year	$ 735	$ 542	$ 826

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Fair Values - Narrative (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Discount percentage applied to real estate appraised values	15.00%
Discount percentage applied to lot development appraised values	6.00%
Partial charge-offs on impaired loans	$ 24,943	$ 28,705
Allowance for loans individually evaluated for impairment	548	4,191
Book Value Of Impaired Loans Carried At Fair Value	6,379	11,783
Impaired loans carried at fair value	5,983	9,496
Impaired Financing Receivable, Related Allowance	548	4,191
Impaired Financing Receivable, carried at fair value, related expense	900	(2,100)	$ (3,000)
MSR recorded at lower of cost or fair value	9,266	9,008	8,613	$ 9,013
Servicing Asset at Fair Value, Amount	6,800	1,900
Valuation allowance of MSR	735	542	826	$ 1,031
MSRs recorded at cost	2,500	7,100
Valuation allowance for impairment of recognized servicing assets, provisions (recoveries)	(193)	284	205
Other Real Estate, Foreclosed Assets, and Repossessed Assets	$ 13,926	$ 18,651
Percent of OREO held at fair value	50.00%	46.00%
Estimated fair value of other real estate owned (OREO)	$ 6,900	$ 8,500
OREO devaluations	601	1,592	$ 2,406
Commercial Receivables, excluding Commercial, Financial, and Agricultural [Domain]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Impaired Financing Receivable, Related Allowance	$ 396	$ 2,287

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Fair Values - Assets and Liabilities Measured at Fair Value on a Recurring Basis (Details) - USD ($) $ in Thousands	Dec. 31, 2016	Dec. 31, 2015
Fair Value, Assets And Liabilities Measured On Recurring Basis [Line Items]
Mortgage Loans Held for Sale	$ 10,413	$ 7,306
Mortgage IRLCs	124	165
Level 1
Fair Value, Assets And Liabilities Measured On Recurring Basis [Line Items]
Mortgage IRLCs	0	0
Level 2
Fair Value, Assets And Liabilities Measured On Recurring Basis [Line Items]
Mortgage Loans Held for Sale	10,413	7,306
Mortgage IRLCs	124	165
Level 3
Fair Value, Assets And Liabilities Measured On Recurring Basis [Line Items]
Mortgage IRLCs	0	0
Fair value swap
Fair Value, Assets And Liabilities Measured On Recurring Basis [Line Items]
Swaps, fair value	226	226
Fair value swap | Level 3
Fair Value, Assets And Liabilities Measured On Recurring Basis [Line Items]
Swaps, fair value	226	226
Recurring basis
Fair Value, Assets And Liabilities Measured On Recurring Basis [Line Items]
Mortgage Loans Held for Sale	10,413	7,306
Mortgage IRLCs	124	165
Recurring basis | Level 2
Fair Value, Assets And Liabilities Measured On Recurring Basis [Line Items]
Mortgage Loans Held for Sale	10,413	7,306
Mortgage IRLCs	124	165
Recurring basis | Obligations of U.S. Treasury and other U.S. Government sponsored entities
Fair Value, Assets And Liabilities Measured On Recurring Basis [Line Items]
Investment Securities	267,533	522,063
Recurring basis | Obligations of U.S. Treasury and other U.S. Government sponsored entities | Level 2
Fair Value, Assets And Liabilities Measured On Recurring Basis [Line Items]
Investment Securities	267,533	522,063
Recurring basis | U.S. Government Sponsored Entities’ Asset-Backed Securities
Fair Value, Assets And Liabilities Measured On Recurring Basis [Line Items]
Investment Securities	987,172	911,493
Recurring basis | U.S. Government Sponsored Entities’ Asset-Backed Securities | Level 2
Fair Value, Assets And Liabilities Measured On Recurring Basis [Line Items]
Investment Securities	987,172	911,493
Recurring basis | Equity securities
Fair Value, Assets And Liabilities Measured On Recurring Basis [Line Items]
Investment Securities	3,434	2,710
Recurring basis | Equity securities | Level 1
Fair Value, Assets And Liabilities Measured On Recurring Basis [Line Items]
Investment Securities	2,644	1,941
Recurring basis | Equity securities | Level 3
Fair Value, Assets And Liabilities Measured On Recurring Basis [Line Items]
Investment Securities	790	769
Recurring basis | Fair value swap
Fair Value, Assets And Liabilities Measured On Recurring Basis [Line Items]
Swaps, fair value	226	226
Recurring basis | Fair value swap | Level 3
Fair Value, Assets And Liabilities Measured On Recurring Basis [Line Items]
Swaps, fair value	$ 226	$ 226

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Fair Values - Reconciliation of the Level 3 Inputs for Financial Instruments Measured on a Recurring Basis (Details) - Recurring basis - Level 3 - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015
Equity Securities
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Beginning balance	$ 769	$ 776
Total Gains (Losses)
Included in earnings - realized	0	0
Included in earnings - unrealized	0	0
Included in other comprehensive income	21	(7)
Purchases, sales, issuances and settlements, other, net	0	0
Re-evaluation of fair value swap		0
Ending balance	790	769
Fair Value Swap
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Beginning balance	(226)	(226)
Total Gains (Losses)
Included in earnings - realized	0	0
Included in earnings - unrealized	0	0
Purchases, sales, issuances and settlements, other, net	0	0
Re-evaluation of fair value swap		0
Ending Balance	$ (226)	$ (226)

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Fair Values - Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis (Details) - USD ($) $ in Thousands	Dec. 31, 2016	Dec. 31, 2015
Fair Value, Assets And Liabilities Measured On Nonrecurring Basis [Line Items]
Impaired loans carried at fair value	$ 5,983	$ 9,496
Mortgage Servicing Rights	6,800	1,900
Other loans	5,161,919	4,997,318
Level 3
Fair Value, Assets And Liabilities Measured On Nonrecurring Basis [Line Items]
Impaired loans carried at fair value	5,983	9,496
Other loans	5,161,919	4,997,318
Nonrecurring basis
Fair Value, Assets And Liabilities Measured On Nonrecurring Basis [Line Items]
Impaired loans carried at fair value	5,983	9,496
Mortgage Servicing Rights	6,769	1,867
Other loans	6,897	8,515
Nonrecurring basis | Level 1
Fair Value, Assets And Liabilities Measured On Nonrecurring Basis [Line Items]
Other loans	0	0
Nonrecurring basis | Level 2
Fair Value, Assets And Liabilities Measured On Nonrecurring Basis [Line Items]
Mortgage Servicing Rights	6,769	1,867
Other loans	0	0
Nonrecurring basis | Level 3
Fair Value, Assets And Liabilities Measured On Nonrecurring Basis [Line Items]
Impaired loans carried at fair value	5,983	9,496
Other loans	6,897	8,515
Nonrecurring basis | Commercial real estate
Fair Value, Assets And Liabilities Measured On Nonrecurring Basis [Line Items]
Impaired loans carried at fair value	3,057	3,698
Other loans	2,644	2,796
Nonrecurring basis | Commercial real estate | Level 1
Fair Value, Assets And Liabilities Measured On Nonrecurring Basis [Line Items]
Other loans	0	0
Nonrecurring basis | Commercial real estate | Level 2
Fair Value, Assets And Liabilities Measured On Nonrecurring Basis [Line Items]
Other loans	0	0
Nonrecurring basis | Commercial real estate | Level 3
Fair Value, Assets And Liabilities Measured On Nonrecurring Basis [Line Items]
Impaired loans carried at fair value	3,057	3,698
Other loans	2,644	2,796
Nonrecurring basis | Construction real estate
Fair Value, Assets And Liabilities Measured On Nonrecurring Basis [Line Items]
Other loans	3,322	3,387
Nonrecurring basis | Construction real estate | Level 1
Fair Value, Assets And Liabilities Measured On Nonrecurring Basis [Line Items]
Other loans	0	0
Nonrecurring basis | Construction real estate | Level 2
Fair Value, Assets And Liabilities Measured On Nonrecurring Basis [Line Items]
Other loans	0	0
Nonrecurring basis | Construction real estate | Level 3
Fair Value, Assets And Liabilities Measured On Nonrecurring Basis [Line Items]
Other loans	3,322	3,387
Nonrecurring basis | SEPH commercial land and development
Fair Value, Assets And Liabilities Measured On Nonrecurring Basis [Line Items]
Impaired loans carried at fair value		2,044
Nonrecurring basis | SEPH commercial land and development | Level 3
Fair Value, Assets And Liabilities Measured On Nonrecurring Basis [Line Items]
Impaired loans carried at fair value		2,044
Nonrecurring basis | Remaining commercial
Fair Value, Assets And Liabilities Measured On Nonrecurring Basis [Line Items]
Impaired loans carried at fair value	541	1,872
Nonrecurring basis | Remaining commercial | Level 3
Fair Value, Assets And Liabilities Measured On Nonrecurring Basis [Line Items]
Impaired loans carried at fair value	541	1,872
Nonrecurring basis | Residential real estate
Fair Value, Assets And Liabilities Measured On Nonrecurring Basis [Line Items]
Impaired loans carried at fair value	2,385	1,882
Other loans	931	2,332
Nonrecurring basis | Residential real estate | Level 1
Fair Value, Assets And Liabilities Measured On Nonrecurring Basis [Line Items]
Other loans	0	0
Nonrecurring basis | Residential real estate | Level 2
Fair Value, Assets And Liabilities Measured On Nonrecurring Basis [Line Items]
Other loans	0	0
Nonrecurring basis | Residential real estate | Level 3
Fair Value, Assets And Liabilities Measured On Nonrecurring Basis [Line Items]
Impaired loans carried at fair value	2,385	1,882
Other loans	$ 931	$ 2,332

XML

Fair Values - Qualitative Information About Level 3 Fair Value Measurements for Financial Instruments Measured at Fair Value on a Non-recurring Basis (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Impaired loans	$ 5,983	$ 9,496
Other real estate owned	5,161,919	4,997,318
Nonrecurring basis
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Impaired loans	5,983	9,496
Other real estate owned	6,897	8,515
Commercial real estate | Nonrecurring basis
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Impaired loans	3,057	3,698
Other real estate owned	2,644	2,796
Commercial real estate | Nonrecurring basis | Loans receivable
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Impaired loans	3,057	3,698
Construction real estate | Nonrecurring basis
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Other real estate owned	3,322	3,387
SEPH commercial land and development | Nonrecurring basis | Loans receivable
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Impaired loans		2,044
Remaining commercial | Nonrecurring basis
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Impaired loans	541	1,872
Remaining commercial | Nonrecurring basis | Loans receivable
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Impaired loans	541	1,872
Residential real estate | Nonrecurring basis
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Impaired loans	2,385	1,882
Other real estate owned	931	2,332
Residential real estate | Nonrecurring basis | Loans receivable
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Impaired loans	2,385	1,882
Commercial real estate | Nonrecurring basis | Other real estate owned
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Other real estate owned	2,644	2,796
Construction real estate | Nonrecurring basis | Other real estate owned
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Other real estate owned	3,322	3,387
Residential Real Estate | Nonrecurring basis | Other real estate owned
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Other real estate owned	$ 931	$ 2,332
Sales comparison approach | Commercial real estate | Low | Nonrecurring basis | Loans receivable
Fair Value Inputs [Abstract]
Adj to comparables	0.00%	0.00%
Sales comparison approach | Commercial real estate | High | Nonrecurring basis | Loans receivable
Fair Value Inputs [Abstract]
Adj to comparables	90.00%	45.90%
Sales comparison approach | Commercial real estate | Weighted Average [Member] | Nonrecurring basis | Loans receivable
Fair Value Inputs [Abstract]
Adj to comparables	20.20%	20.30%
Sales comparison approach | SEPH commercial land and development | Low | Nonrecurring basis | Loans receivable
Fair Value Inputs [Abstract]
Adj to comparables		5.00%
Sales comparison approach | SEPH commercial land and development | High | Nonrecurring basis | Loans receivable
Fair Value Inputs [Abstract]
Adj to comparables		40.00%
Sales comparison approach | SEPH commercial land and development | Weighted Average [Member] | Nonrecurring basis | Loans receivable
Fair Value Inputs [Abstract]
Adj to comparables		22.10%
Sales comparison approach | Remaining commercial | Low | Nonrecurring basis | Loans receivable
Fair Value Inputs [Abstract]
Adj to comparables	0.00%	0.00%
Sales comparison approach | Remaining commercial | High | Nonrecurring basis | Loans receivable
Fair Value Inputs [Abstract]
Adj to comparables	11.10%	25.30%
Sales comparison approach | Remaining commercial | Weighted Average [Member] | Nonrecurring basis | Loans receivable
Fair Value Inputs [Abstract]
Adj to comparables	1.60%	1.00%
Sales comparison approach | Residential real estate | Low | Nonrecurring basis | Loans receivable
Fair Value Inputs [Abstract]
Adj to comparables	0.00%	0.00%
Sales comparison approach | Residential real estate | High | Nonrecurring basis | Loans receivable
Fair Value Inputs [Abstract]
Adj to comparables	110.00%	96.70%
Sales comparison approach | Residential real estate | Weighted Average [Member] | Nonrecurring basis | Loans receivable
Fair Value Inputs [Abstract]
Adj to comparables	17.00%	12.50%
Sales comparison approach | Commercial real estate | Low | Nonrecurring basis | Other real estate owned
Fair Value Inputs [Abstract]
Adj to comparables	0.00%	2.00%
Sales comparison approach | Commercial real estate | High | Nonrecurring basis | Other real estate owned
Fair Value Inputs [Abstract]
Adj to comparables	68.40%	71.00%
Sales comparison approach | Commercial real estate | Weighted Average [Member] | Nonrecurring basis | Other real estate owned
Fair Value Inputs [Abstract]
Adj to comparables	26.50%	26.90%
Sales comparison approach | Construction real estate | Low | Nonrecurring basis | Other real estate owned
Fair Value Inputs [Abstract]
Adj to comparables	0.00%	0.00%
Sales comparison approach | Construction real estate | High | Nonrecurring basis | Other real estate owned
Fair Value Inputs [Abstract]
Adj to comparables	90.00%	85.00%
Sales comparison approach | Construction real estate | Weighted Average [Member] | Nonrecurring basis | Other real estate owned
Fair Value Inputs [Abstract]
Adj to comparables	24.70%	24.30%
Sales comparison approach | Residential Real Estate | Low | Nonrecurring basis | Other real estate owned
Fair Value Inputs [Abstract]
Adj to comparables	3.20%	0.00%
Sales comparison approach | Residential Real Estate | High | Nonrecurring basis | Other real estate owned
Fair Value Inputs [Abstract]
Adj to comparables	79.70%	61.80%
Sales comparison approach | Residential Real Estate | Weighted Average [Member] | Nonrecurring basis | Other real estate owned
Fair Value Inputs [Abstract]
Adj to comparables	30.60%	23.00%
Income approach | Commercial real estate | Low | Nonrecurring basis | Loans receivable
Fair Value Inputs [Abstract]
Capitalization rate	9.00%	7.00%
Income approach | Commercial real estate | High | Nonrecurring basis | Loans receivable
Fair Value Inputs [Abstract]
Capitalization rate	10.60%	13.30%
Income approach | Commercial real estate | Weighted Average [Member] | Nonrecurring basis | Loans receivable
Fair Value Inputs [Abstract]
Capitalization rate	10.10%	9.50%
Income approach | Residential real estate | Low | Nonrecurring basis | Loans receivable
Fair Value Inputs [Abstract]
Capitalization rate	10.00%	3.80%
Income approach | Residential real estate | High | Nonrecurring basis | Loans receivable
Fair Value Inputs [Abstract]
Capitalization rate	10.00%	10.10%
Income approach | Residential real estate | Weighted Average [Member] | Nonrecurring basis | Loans receivable
Fair Value Inputs [Abstract]
Capitalization rate	10.00%	9.10%
Income approach | Commercial real estate | Low | Nonrecurring basis | Other real estate owned
Fair Value Inputs [Abstract]
Capitalization rate	13.00%	9.50%
Income approach | Commercial real estate | High | Nonrecurring basis | Other real estate owned
Fair Value Inputs [Abstract]
Capitalization rate	14.00%	9.50%
Income approach | Commercial real estate | Weighted Average [Member] | Nonrecurring basis | Other real estate owned
Fair Value Inputs [Abstract]
Capitalization rate	13.10%	9.50%
Cost approach | Commercial real estate | Low | Nonrecurring basis | Loans receivable
Fair Value Inputs [Abstract]
Fair Value Inputs, Accumulated Depreciation	17.00%	50.00%
Cost approach | Commercial real estate | High | Nonrecurring basis | Loans receivable
Fair Value Inputs [Abstract]
Fair Value Inputs, Accumulated Depreciation	18.00%	50.00%
Cost approach | Commercial real estate | Weighted Average [Member] | Nonrecurring basis | Loans receivable
Fair Value Inputs [Abstract]
Fair Value Inputs, Accumulated Depreciation	17.80%	50.00%
Cost approach | Residential real estate | Low | Nonrecurring basis | Loans receivable
Fair Value Inputs [Abstract]
Fair Value Inputs, Accumulated Depreciation		33.30%
Cost approach | Residential real estate | High | Nonrecurring basis | Loans receivable
Fair Value Inputs [Abstract]
Fair Value Inputs, Accumulated Depreciation		50.00%
Cost approach | Residential real estate | Weighted Average [Member] | Nonrecurring basis | Loans receivable
Fair Value Inputs [Abstract]
Fair Value Inputs, Accumulated Depreciation		43.40%
Bulk sale approach | SEPH commercial land and development | Low | Nonrecurring basis | Loans receivable
Fair Value Inputs [Abstract]
Discount rate		10.70%
Bulk sale approach | SEPH commercial land and development | High | Nonrecurring basis | Loans receivable
Fair Value Inputs [Abstract]
Discount rate		10.70%
Bulk sale approach | SEPH commercial land and development | Weighted Average [Member] | Nonrecurring basis | Loans receivable
Fair Value Inputs [Abstract]
Discount rate		10.70%
Bulk sale approach | Remaining commercial | Low | Nonrecurring basis | Loans receivable
Fair Value Inputs [Abstract]
Discount rate	10.00%	10.00%
Bulk sale approach | Remaining commercial | High | Nonrecurring basis | Loans receivable
Fair Value Inputs [Abstract]
Discount rate	10.00%	10.70%
Bulk sale approach | Remaining commercial | Weighted Average [Member] | Nonrecurring basis | Loans receivable
Fair Value Inputs [Abstract]
Discount rate	10.00%	10.00%
Bulk sale approach | Construction real estate | Low | Nonrecurring basis | Other real estate owned
Fair Value Inputs [Abstract]
Discount rate	15.00%	15.00%
Bulk sale approach | Construction real estate | High | Nonrecurring basis | Other real estate owned
Fair Value Inputs [Abstract]
Discount rate	15.00%	15.00%
Bulk sale approach | Construction real estate | Weighted Average [Member] | Nonrecurring basis | Other real estate owned
Fair Value Inputs [Abstract]
Discount rate	15.00%	15.00%

XML

Fair Values - Fair Value of Financial Instruments (Details) - USD ($) $ in Thousands	Dec. 31, 2016	Dec. 31, 2015
Financial assets:
Cash and money market instruments	$ 146,466	$ 149,459
Investment securities	1,514,811	1,587,694
Mortgage loans held for sale	10,413	7,306
Impaired loans carried at fair value	5,983	9,496
Derivative Asset	124	165
Other loans	5,161,919	4,997,318
Loans receivable, net	5,178,439	5,014,285
Financial liabilities:
Non-interest bearing checking accounts	1,523,417	1,404,032
Interest bearing transaction accounts	1,174,448	1,107,200
Savings accounts	1,704,920	1,544,708
Time Deposits, Fair Value	1,122,598	1,295,329
Other	1,301	1,290
Total deposits	5,526,684	5,352,559
Short-term borrowings	394,795	394,242
Long-term debt	712,958	771,420
Subordinated debentures/notes	40,903	41,596
Fair value swap
Derivative financial instruments:
Swaps, fair value	226	226
Level 1
Financial assets:
Cash and money market instruments	146,466	149,459
Investment securities	2,644	1,941
Derivative Asset	0	0
Loans receivable, net	0	0
Financial liabilities:
Non-interest bearing checking accounts	1,523,417	1,404,032
Interest bearing transaction accounts	1,174,448	1,107,200
Savings accounts	1,704,920	1,544,708
Other	1,301	1,290
Total deposits	4,404,086	4,057,230
Level 2
Financial assets:
Investment securities	1,511,377	1,584,984
Mortgage loans held for sale	10,413	7,306
Derivative Asset	124	165
Loans receivable, net	10,537	7,471
Financial liabilities:
Time Deposits, Fair Value	1,122,598	1,295,329
Total deposits	1,122,598	1,295,329
Short-term borrowings	394,795	394,242
Long-term debt	712,958	771,420
Subordinated debentures/notes	40,903	41,596
Level 3
Financial assets:
Investment securities	790	769
Impaired loans carried at fair value	5,983	9,496
Derivative Asset	0	0
Other loans	5,161,919	4,997,318
Loans receivable, net	5,167,902	5,006,814
Financial liabilities:
Total deposits	0	0
Level 3 | Fair value swap
Derivative financial instruments:
Swaps, fair value	226	226
Available-for-sale Securities [Member]
Financial assets:
Accrued interest receivable	3,849	4,436
Available-for-sale Securities [Member] | Level 2
Financial assets:
Accrued interest receivable	3,849	4,436
Loans
Financial assets:
Accrued interest receivable	14,973	14,239
Loans | Level 3
Financial assets:
Accrued interest receivable	14,973	14,239
Deposits
Financial liabilities:
Accrued interest payable	900	987
Deposits | Level 1
Financial liabilities:
Accrued interest payable	82	66
Deposits | Level 2
Financial liabilities:
Accrued interest payable	818	921
Borrowings
Financial liabilities:
Accrued interest payable	1,251	1,351
Borrowings | Level 1
Financial liabilities:
Accrued interest payable	1	4
Borrowings | Level 2
Financial liabilities:
Accrued interest payable	1,250	1,347
Reported Value Measurement [Member]
Financial assets:
Cash and money market instruments	146,466	149,459
Investment securities	1,517,972	1,585,568
Mortgage loans held for sale	10,413	7,306
Impaired loans carried at fair value	5,983	9,496
Derivative Asset	124	165
Other loans	5,204,713	4,994,624
Loans receivable, net	5,221,233	5,011,591
Financial liabilities:
Non-interest bearing checking accounts	1,523,417	1,404,032
Interest bearing transaction accounts	1,174,448	1,107,200
Savings accounts	1,704,920	1,544,708
Time Deposits, Fair Value	1,117,870	1,290,412
Other	1,301	1,290
Total deposits	5,521,956	5,347,642
Short-term borrowings	394,795	394,242
Long-term debt	694,281	738,105
Subordinated debentures/notes	45,000	45,000
Reported Value Measurement [Member] | Fair value swap
Derivative financial instruments:
Swaps, fair value	226	226
Reported Value Measurement [Member] | Available-for-sale Securities [Member]
Financial assets:
Accrued interest receivable	3,849	4,436
Reported Value Measurement [Member] | Loans
Financial assets:
Accrued interest receivable	14,973	14,239
Reported Value Measurement [Member] | Deposits
Financial liabilities:
Accrued interest payable	900	987
Reported Value Measurement [Member] | Borrowings
Financial liabilities:
Accrued interest payable	$ 1,251	$ 1,351

XML

Fair Values Schedule of Impaired Financing Receivables (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Financing Receivable, Impaired [Line Items]
Book Value Of Impaired Loans Carried At Fair Value	$ 6,379	$ 11,783
Partial Charge-Offs On Impaired Loans carried at Fair Value	3,681	10,512
Impaired Financing Receivable, Related Allowance	548	4,191
Impaired loans carried at fair value	5,983	9,496
Impaired Financing Receivable, loans not held at Fair Value, Recorded Investment	64,047	68,881
Partial Charge-offs on Impaired Loans carried at Cost	21,262	18,193
impaired Financing Receivable, loans not held at Fair Value, Carrying Amount	63,895	66,977
Recorded investment	70,426	80,664	$ 73,712
Partial charge-offs on impaired loans	24,943	28,705
Individually evaluated for impairment	548	4,191
Impaired Financing Receivable, Carrying Value	69,878	76,473
Financing Receivable, not collateral dependent [Domain]
Financing Receivable, Impaired [Line Items]
Impaired Financing Receivable, Related Allowance	152	1,904
Commercial Receivables, excluding Commercial, Financial, and Agricultural [Domain]
Financing Receivable, Impaired [Line Items]
Impaired Financing Receivable, Related Allowance	$ 396	$ 2,287

XML

Capital Ratios - Capital Ratios for Park and Each Subsidiary (Details) - USD ($) $ in Thousands	Dec. 31, 2016	Dec. 31, 2015
Compliance with Regulatory Capital Requirements under Banking Regulations [Line Items]
Capital Conservation Buffer	0.625%
Park National Bank
Compliance with Regulatory Capital Requirements under Banking Regulations [Line Items]
Tier 1 Risk-Based Capital	9.87%	9.83%
Tier One Risk Based Capital Required for Capital Adequacy	$ 324,115	$ 310,560
Common Equity Tier 1	9.87%	9.83%
Common Equity Tier 1 Capital Required For Capital Adequacy	$ 243,086	$ 232,920
Total Risk-Based	11.24%	11.37%
Capital Required for Capital Adequacy	$ 432,153	$ 414,079
Leverage Capital Required For Capital Adequacy To Average Total Assets	4.00%	4.00%
Common Equity Tier 1 Capital	$ 533,215	$ 508,763
Leverage Capital Required To Be Well Capitalized	$ 363,339	$ 360,183
Tier One Risk Based Capital Required for Capital Adequacy to Risk Weighted Assets	6.00%	6.00%
Leverage Capital	$ 533,215	$ 508,763
Tier One Risk Based Capital Required to be Well Capitalized	$ 432,153	$ 414,079
Common Equity Tier 1 Capital Required For Capital Adequacy To Average Total Assets	4.50%	4.50%
Common Equity Tier 1 Capital Required To Be Well Capitalized	$ 351,125	$ 336,439
Leverage	7.34%	7.06%
Leverage Capital Required For Capital Adequacy	$ 290,671	$ 288,147
Capital Required for Capital Adequacy to Risk Weighted Assets	8.00%	8.00%
Capital Required to be Well Capitalized	$ 540,192	$ 517,599
Tier One Risk Based Capital	$ 533,215	$ 508,763
Common Equity Tier 1 Capital Required To Be Well Capitalized To Average Total Assets	6.50%	6.50%
Risk Based Capital	$ 607,269	$ 588,467
Leverage Capital Required To Be Well Capitalized To Average Total Assets	5.00%	5.00%
Tier One Risk Based Capital Required to be Well Capitalized to Risk Weighted Assets	8.00%	8.00%
Capital Required to be Well Capitalized to Risk Weighted Assets	10.00%	10.00%
Park
Compliance with Regulatory Capital Requirements under Banking Regulations [Line Items]
Tier 1 Risk-Based Capital	12.83%	12.82%
Tier One Risk Based Capital Required for Capital Adequacy	$ 328,673	$ 314,310
Common Equity Tier 1	12.55%	12.54%
Common Equity Tier 1 Capital Required For Capital Adequacy	$ 246,505	$ 235,732
Total Risk-Based	14.32%	14.49%
Capital Required for Capital Adequacy	$ 438,231	$ 419,080
Leverage Capital Required For Capital Adequacy To Average Total Assets	4.00%	4.00%
Common Equity Tier 1 Capital	$ 687,651	$ 656,664
Tier One Risk Based Capital Required for Capital Adequacy to Risk Weighted Assets	6.00%	6.00%
Leverage Capital	$ 702,651	$ 671,664
Common Equity Tier 1 Capital Required For Capital Adequacy To Average Total Assets	4.50%	4.50%
Leverage	9.56%	9.22%
Leverage Capital Required For Capital Adequacy	$ 293,916	$ 291,449
Capital Required for Capital Adequacy to Risk Weighted Assets	8.00%	8.00%
Leverage Capital Required For Capital Adequacy plus capital conservation buffer To Average Total Assets	4.00%	4.00%
Tier One Risk Based Capital Required For Capital Adequacy plus capital conservation buffer To Average Total Assets	8.50%	8.50%
Common Equity Tier 1 Capital Required For Capital Adequacy plus capital conservation buffer To Average Total Assets	7.00%	7.00%
Capital Required For Capital Adequacy plus capital conservation buffer To Average Total Assets	10.50%	10.50%
Tier One Risk Based Capital	$ 702,651	$ 671,664
Risk Based Capital	$ 784,406	$ 758,988

XML

Segment Information - Schedule of Operating Results by Segment (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Segment Reporting Information [Line Items]
Other Noninterest Expense	$ 190,627	$ 179,267	$ 180,267
Net interest income (loss)	238,086	227,632	225,044
Depreciation, Amortization and Accretion, Net	8,396	7,347	7,243
(Recovery of) provision for loan losses	(5,101)	4,990	(7,333)
Other income	78,731	77,551	75,549
Gain (Loss) on Sale of Investments	0	0	(1,158)
Other expense	199,023	186,614	187,510
Income (loss) before taxes	122,895	113,579	120,416
Income taxes (benefit)	36,760	32,567	36,459
Net income	86,135	81,012	83,957
Assets	7,467,586	7,311,354	7,001,199
Loans	5,271,857	5,068,085	4,829,682
Total deposits	5,521,956	5,347,642	5,128,000
Totals For Reportable Segments [Member]
Segment Reporting Information [Line Items]
Other Noninterest Expense	180,896	169,295	172,267
Net interest income (loss)	238,224	227,393	227,056
Depreciation, Amortization and Accretion, Net	8,396	7,347	7,243
Income taxes (benefit)	41,117	37,238	41,246
Assets	7,447,148	7,299,098	6,994,456
Total deposits	5,634,008	5,451,920	5,228,649
PNB
Segment Reporting Information [Line Items]
Net interest income (loss)	227,576	220,879	218,641
(Recovery of) provision for loan losses	2,611	7,665	3,517
Other income	74,803	75,188	69,384
Other expense	177,562	167,476	163,641
Income (loss) before taxes	122,206	120,926	120,867
Income taxes (benefit)	37,755	36,581	37,960
Net income	84,451	84,345	82,907
Assets	7,389,538	7,229,764	6,910,386
Loans	5,234,828	5,029,072	4,781,761
Total deposits	5,630,199	5,447,293	5,222,766
GFSC
Segment Reporting Information [Line Items]
Net interest income (loss)	5,874	6,588	7,457
(Recovery of) provision for loan losses	1,887	1,415	1,544
Other income	(1)	2	(1)
Other expense	4,457	2,984	4,103
Income (loss) before taxes	(471)	2,191	1,809
Income taxes (benefit)	(164)	768	634
Net income	(307)	1,423	1,175
Assets	32,268	35,793	40,308
Loans	32,661	35,469	40,645
Total deposits	3,809	4,627	5,883
SEPH
Segment Reporting Information [Line Items]
Net interest income (loss)	4,774	(74)	958
(Recovery of) provision for loan losses	(9,599)	(4,090)	(12,394)
Other income	2,974	1,848	5,991
Other expense	7,273	6,182	11,766
Income (loss) before taxes	10,074	(318)	7,577
Income taxes (benefit)	3,526	(111)	2,652
Net income	6,548	(207)	4,925
Assets	25,342	33,541	43,762
Loans	12,354	15,153	23,956
Total deposits	0	0	0
All Other
Segment Reporting Information [Line Items]
Net interest income (loss)	(138)	239	(2,012)
(Recovery of) provision for loan losses	0	0	0
Other income	955	513	175
Other expense	9,731	9,972	8,000
Income (loss) before taxes	(8,914)	(9,220)	(9,837)
Income taxes (benefit)	(4,357)	(4,671)	(4,787)
Net income	(4,557)	(4,549)	(5,050)
Assets	20,438	12,256	6,743
Loans	(7,986)	(11,609)	(16,680)
Total deposits	(112,052)	(104,278)	(100,649)
Intersegment Eliminations [Member]
Segment Reporting Information [Line Items]
Other Noninterest Expense	0	0	0
Net interest income (loss)	2,164	2,561	3,708
Depreciation, Amortization and Accretion, Net	0	0	0
Income taxes (benefit)	0	0	0
Assets	(9,204)	(13,557)	(18,556)
Total deposits	(112,052)	(104,278)	(100,649)
Parent Co Gfsc Totals Not Eliminated [Member]
Segment Reporting Information [Line Items]
Other Noninterest Expense	9,731	9,972	8,000
Net interest income (loss)	(2,302)	(2,322)	(5,720)
Depreciation, Amortization and Accretion, Net	0	0	0
Income taxes (benefit)	(4,357)	(4,671)	(4,787)
Assets	29,642	25,813	25,299
Total deposits	$ 0	$ 0	$ 0

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Parent Company Statements - Narrative (Details) - Parent Company - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Income taxes	$ 4,400	$ 4,130	$ 5,810
Undistributed earnings, restricted from transfer as dividends	$ 259,700	$ 199,400

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Parent Company Statements - Balance Sheets (Details) - USD ($) $ in Thousands	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Assets:
Other assets	$ 520,124	$ 506,425
Total assets	7,467,586	7,311,354	$ 7,001,199
Liabilities:
Subordinated notes	45,000	45,000
Other liabilities	69,314	73,010
Total liabilities	6,725,346	6,597,999
Total liabilities and shareholders’ equity	7,467,586	7,311,354
Parent Company
Assets:
Cash	112,067	102,416	$ 98,671	$ 106,942
Investment in subsidiaries	626,569	613,383
Debentures receivable from PNB	25,000	25,000
Other investments	2,962	2,341
Other assets	26,651	23,443
Total assets	793,249	766,583
Liabilities:
Subordinated notes	45,000	45,000
Other liabilities	6,009	8,228
Total liabilities	51,009	53,228
Total shareholders’ equity	742,240	713,355
Total liabilities and shareholders’ equity	$ 793,249	$ 766,583

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Parent Company Statements - Statements of Income (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Income:
Interest and dividends	$ 276,258	$ 265,074	$ 265,143
Expense:
Federal income tax benefit	(36,760)	(32,567)	(36,459)
Net income	86,135	81,012	83,957
Other Comprehensive Income (Loss), Net of Tax	(2,102)	(2,035)	21,811
Parent Company
Income:
Dividends from subsidiaries	60,000	60,000	60,000
Interest and dividends	2,164	2,561	3,708
Other	1,081	560	262
Total income	63,245	63,121	63,970
Expense:
Other, net	12,159	12,341	13,807
Total expense	12,159	12,341	13,807
Income before federal taxes and equity in undistributed income of subsidiaries	51,086	50,780	50,163
Federal income tax benefit	4,357	4,671	4,787
Income before equity in undistributed income of subsidiaries	55,443	55,451	54,950
Equity in undistributed income of subsidiaries	30,692	25,561	29,007
Net income	86,135	81,012	83,957
Other Comprehensive Income (Loss), Net of Tax	(2,102)	(2,035)	21,811
Comprehensive Income (Loss), Net of Tax, Attributable to Parent	$ 84,033	$ 78,977	$ 105,768

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Parent Company Statements - Statements of Cash Flows (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Net income	$ 86,135	$ 81,012	$ 83,957
Adjustments to reconcile net income to net cash provided by operating activities:
Share-based Compensation	2,814	1,828	1,259
(Decrease) increase in other liabilities	2,006	1,173	5,689
Net cash provided by operating activities	87,887	89,234	71,743
Investing activities:
Net cash used in investing activities	(152,560)	(395,468)	(229,580)
Financing activities
Repayment of subordinated notes	0	0	(35,250)
Net cash provided by financing activities	61,660	217,994	248,506
Increase (decrease) in cash and cash equivalents	(3,013)	(88,240)	90,669
Parent Company
Net income	86,135	81,012	83,957
Adjustments to reconcile net income to net cash provided by operating activities:
Undistributed income of subsidiaries	(30,692)	(25,561)	(29,007)
Increase in other assets	(3,425)	(182)	(1,292)
(Decrease) increase in other liabilities	(2,524)	485	298
Net cash provided by operating activities	52,308	57,582	55,215
Investing activities:
Repayment of investments in and advances to subsidiaries	15,000	10,000	32,000
Net cash used in investing activities	15,000	10,000	32,000
Financing activities
Cash dividends paid	(57,653)	(57,776)	(57,876)
Cash payment for fractional shares	(4)	(3)	(5)
Net cash provided by financing activities	(57,657)	(63,837)	(95,486)
Increase (decrease) in cash and cash equivalents	9,651	3,745	(8,271)
Cash at beginning of year	102,416	98,671	106,942
Cash at end of year	112,067	102,416	98,671
Parent Company
Adjustments to reconcile net income to net cash provided by operating activities:
Compensation expense for issuance of treasury shares to directors	950	963	801
Share-based Compensation	1,864	865	458
Treasury Stock, Common [Member]
Financing activities
Payments for Repurchase of Equity	$ 0	$ 6,058	$ 2,355