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Loans
 12 Months Ended
Dec. 31, 2021
Loans and Leases Receivable Disclosure [Abstract]  
Loans Loans
The composition of the loan portfolio at December 31, 2021 and December 31, 2020 was as follows:
 
December 31, 2021December 31, 2020
(In thousands)Amortized CostAmortized CostAccrued Interest ReceivableRecorded Investment
Commercial, financial and agricultural: (1)
1,588,989 $6,528 $1,595,517 
Commercial, financial and agricultural (1)
$1,223,079 (2)(2)(2)
PPP loans74,420 (2)(2)(2)
Overdrafts1,127 (2)(2)(2)
Commercial real estate (1)
1,801,792 1,748,189 $6,017 $1,754,206 
Construction real estate:
Commercial214,561 226,991 $572 $227,563 
Retail107,225 116,430 $235 $116,665 
Residential real estate:  
Commercial533,802 526,222 $1,161 $527,383 
Mortgage1,033,658 1,096,358 $947 $1,097,305 
HELOC165,605 182,028 $647 $182,675 
Installment5,642 8,436 $22 $8,458 
Consumer:1,659,704 $4,510 $1,664,214 
Consumer1,685,793 (2)(2)(2)
GFSC1,793 (2)(2)(2)
Check loans2,093 (2)(2)(2)
Leases20,532 24,438 $14 $24,452 
Total$6,871,122 $7,177,785 $20,653 $7,198,438 
Allowance for credit losses(83,197)(85,675)
Net loans$6,787,925 $7,092,110 

(1) Included within each of commercial, financial and agricultural loans and commercial real estate loans is an immaterial amount of consumer loans that were not broken out by class.
(2) Results for reporting periods beginning after January 1, 2021 are presented under ASC 326, while prior period amounts continue to be reported in accordance with previously applicable U.S. GAAP. Category was not broken out as a separate class at December 31, 2020.

In order to support customers, Park participated in the CARES Act Paycheck Protection Program ("PPP"). PPP loans were broken out as a separate class as of December 31, 2021. Included within commercial, financial and agricultural loans as of December 31, 2020 were $331.6 million of PPP loans. For its assistance in originating the first round of PPP loans during 2020, Park received an aggregate of $20.2 million in fees from the SBA, and for its assistance in originating additional PPP loans during 2021, Park received an aggregate of $12.9 million in fees from the SBA. During the years ended December 31, 2021 and December 31, 2020, $16.3 million and $13.7 million, respectively, of PPP fee income was recognized within loan interest income. There was no PPP fee income earned during the year ended December 31, 2019.

Loans are shown net of deferred origination fees, costs and unearned income of $19.5 million at December 31, 2021, and of $23.6 million at December 31, 2020, which represented a net deferred income position in both years. At December 31, 2021 and December 31, 2020, included in the net deferred origination fees, costs and unearned income were $2.8 million and $6.5 million, respectively, in net origination fees related to PPP loans. At December 31, 2021 and December 31, 2020, loans included purchase accounting adjustments of $4.2 million and $7.2 million, respectively, which represented a net deferred income position at each date. This fair market value purchase accounting adjustment is expected to be recognized into interest income on a level yield basis over the remaining expected life of the loans.

Overdrawn deposit accounts of $1.1 million and $2.0 million were reclassified to loans at December 31, 2021 and December 31, 2020, respectively. As of December 31, 2021, overdrafts were within their own class and as of December 31, 2020, overdrafts were included in the commercial, financial and agricultural loan segment in the previous table.
Credit Quality
The following table presents the amortized cost of nonaccrual loans, accruing TDRs, and loans past due 90 days or more and still accruing, by class of loan, at December 31, 2021:
 
 December 31, 2021
(In thousands)Nonaccrual
Loans		Accruing
TDRs		Loans Past Due
90 Days
 or More
and Accruing		Total
Nonperforming
Loans
Commercial, financial and agricultural:
Commercial, financial and agricultural$13,271 $9,396 $— $22,667 
PPP loans— — 793 793 
Overdrafts— — — — 
Commercial real estate40,142 7,713 — 47,855 
Construction real estate:
Commercial52 169 — 221 
Retail716 9 — 725 
Residential real estate:
Commercial2,366 240 — 2,606 
Mortgage11,718 7,779 372 19,869 
HELOC1,590 803 — 2,393 
Installment82 1,508 — 1,590 
Consumer:
Consumer1,518 700 431 2,649 
GFSC79 6 11 96 
Check loans— — — — 
Leases1,188 — — 1,188 
Total loans$72,722 $28,323 $1,607 $102,652 

 
The following table presents the recorded investment in nonaccrual loans, accruing TDRs, and loans past due 90 days or more and still accruing, by class of loan, at December 31, 2020:

 December 31, 2020
(In thousands)Nonaccrual
Loans		Accruing
TDRs		Loans Past Due 90 Days or More and AccruingTotal
Nonperforming
Loans
Commercial, financial and agricultural$23,261 5,619 $— $28,880 
Commercial real estate67,426 2,931 377 70,734 
Construction real estate:   
Commercial3,110 — — 3,110 
Mortgage1431 — 45 
Residential real estate:    
Commercial4,304 253 — 4,557 
Mortgage14,016 8,400 416 22,832 
HELOC1,286 909 77 2,272 
Installment184 1,728 — 1,912 
Consumer2,172 1,017 724 3,913 
Leases1,595 — — 1,595 
Total loans$117,368 $20,888 $1,594 $139,850 

The following table provides additional detail on nonaccrual loans and the related ACL, by class of loan, at December 31, 2021:

December 31, 2021
(In thousands)Nonaccrual Loans With No ACLNonaccrual Loans With an ACLRelated ACL
Commercial, financial and agricultural:
Commercial, financial and agricultural11,494 1,777 1,343 
PPP loans— — — 
Overdrafts— — — 
Commercial real estate39,151 991 188 
Construction real estate:
Commercial52 — — 
Retail— 716 67 
Residential real estate:
Commercial2,366 — — 
Mortgage— 11,718 73 
HELOC— 1,590 99 
Installment— 82 24 
Consumer
Consumer— 1,518 393 
GFSC— 79 10 
Check loans— — — 
Leases914 274 43 
Total loans$53,977 $18,745 $2,240 
Nonaccrual commercial loans are evaluated on an individual basis and are excluded from the collective evaluation. Management’s general practice is to proactively charge down loans individually evaluated to the fair value of the underlying collateral. Nonaccrual consumer loans are collectively evaluated based on similar risk characteristics.

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

December 31, 2020
(In thousands)Unpaid Principal BalanceRecorded InvestmentACL Allocated
With no related allowance recorded
Commercial, financial and agricultural23,316 22,970 — 
Commercial real estate63,639 63,467 — 
Construction real estate:
Commercial3,110 3,110 — 
Residential real estate:
Commercial4,522 4,448 — 
Leases568 568 — 
With an allowance recorded
Commercial, financial and agricultural5,881 5,866 3,758 
Commercial real estate6,890 6,890 1,316 
Construction real estate:
Commercial— — — 
Residential real estate:
Commercial109 109 16 
Leases1,027 1,027 344 
Total$109,062 $108,455 $5,434 

The following table provides the amortized cost basis of collateral-dependent loans by class of loan, as of December 31, 2021:

 December 31, 2021
(In thousands)Real EstateBusiness AssetsOtherTotal
Commercial, financial and agricultural
Commercial, financial and agricultural$9,321 $13,366 $156 $22,843 
Commercial real estate52,901 37 — 52,938 
Construction real estate:
Commercial1,178 — — 1,178 
Residential real estate:
Commercial2,906 — 57 2,963 
Mortgage370 — — 370 
HELOC148 — — 148 
Leases— 1,211 — 1,211 
Total loans$66,824 $14,614 $213 $81,651 
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 in the loans. Interest income on accruing TDRs individually evaluated for impairment continues to be recorded on an accrual basis. The following table presents interest income recognized on nonaccrual loans for the year ended December 31, 2021:

Interest Income Recognized
(In thousands)December 31, 2021
Commercial, financial and agricultural:
Commercial, financial and agricultural$180 
PPP loans— 
Overdrafts— 
Commercial real estate1,844 
Construction real estate:
Commercial39 
Retail4 
Residential real estate:
Commercial204 
Mortgage301 
HELOC17 
Installment2 
Consumer:
Consumer92 
GFSC14 
Check loans
Leases73 
Total loans$2,770 

The following table presents the average recorded investment and interest income recognized subsequent to impairment on loans individually evaluated for impairment as of and for the years ended December 31, 2020 and 2019:
  
December 31, 2020December 31, 2019
(In thousands)Recorded InvestmentAverage Recorded InvestmentInterest Income RecognizedRecorded InvestmentAverage Recorded InvestmentInterest Income Recognized
Commercial, financial and agricultural$28,836 $30,280 $735 $33,088 $21,415 $527 
Commercial real estate70,357 55,279 1,890 41,791 32,132 1,241 
Construction real estate:
   Commercial3,110 1,291 50 453 1,987 26 
Residential real estate:
   Commercial4,557 4,329 204 2,025 2,175 99 
Consumer— — — — — — 
Leases1,595 1,115 — 134 59 — 
Total$108,455 $92,294 $2,879 $77,491 $57,768 $1,893 
The following table presents the aging of the amortized cost in past due loans at December 31, 2021 by class of loan:

 December 31, 2021
(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 
Amortized Cost
Commercial, financial and agricultural:
Commercial, financial and agricultural$2,908 $9,547 $12,455 $1,210,624 $1,223,079 
PPP loans242 793 1,035 73,385 74,420 
Overdrafts— — — 1,127 1,127 
Commercial real estate65 1,461 1,526 1,800,266 1,801,792 
Construction real estate:
Commercial— — — 214,561 214,561 
Retail346 660 1,006 106,219 107,225 
Residential real estate:
Commercial283 438 721 533,081 533,802 
Mortgage6,170 5,933 12,103 1,021,555 1,033,658 
HELOC565 1,011 1,576 164,029 165,605 
Installment49 31 80 5,562 5,642 
Consumer:
Consumer2,614 618 3,232 1,682,561 1,685,793 
GFSC153 52 205 1,588 1,793 
Check loans10 — 10 2,083 2,093 
Leases60 526 586 19,946 20,532 
Total loans$13,465 $21,070 $34,535 $6,836,587 $6,871,122 

(1) Includes an aggregate of $1.6 million of loans past due 90 days or more and accruing. The remaining loans were past due nonaccrual loans.
(2) Includes an aggregate of $53.3 million of nonaccrual loans which were current in regards to contractual principal and interest payments.
The following table presents the aging of the recorded investment in past due loans at December 31, 2020 by class of loan:

 December 31, 2020
(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$7,372 $13,968 $21,340 $1,574,177 $1,595,517 
Commercial real estate82 972 1,054 1,753,152 1,754,206 
Construction real estate:
Commercial— 39 39 227,524 227,563 
Mortgage77 — 77 115,647 115,724 
Installment12 — 12 929 941 
Residential real estate:
Commercial17 493 510 526,873 527,383 
Mortgage9,538 7,814 17,352 1,079,953 1,097,305 
HELOC805 810 1,615 181,060 182,675 
Installment67 71 138 8,320 8,458 
Consumer5,496 1,213 6,709 1,657,505 1,664,214 
Leases186 984 1,170 23,282 24,452 
Total loans$23,652 $26,364 $50,016 $7,148,422 $7,198,438 

(1) Includes an aggregate of $1.6 million of loans past due 90 days or more and accruing. The remaining loans were past due nonaccrual loans.
(2) Includes an aggregate of $92.6 million of nonaccrual loans which were 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 at December 31, 2021 and December 31, 2020 is included in the previous tables. The past due information is the primary credit quality indicator within the following classes of loans: (1) overdrafts in the commercial, financial and agricultural portfolio segment; (2) retail loans in the construction real estate portfolio segment; (3) mortgage loans, HELOC and installment loans in the residential real estate portfolio segment; and (4) consumer loans, GFSC loans, and check loans in the consumer portfolio segment. 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 an 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 PD is applied 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 PD is applied 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 individually evaluated category. A loan is deemed impaired, and is individually evaluated, 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.
Based on the most recent analysis performed, the risk category of loans by class of loans as of December 31, 2021 follows:

December 31, 2021Term Loans Amortized Cost Basis by Origination Year
(In thousands)20212020201920182017PriorRevolving Loans Amortized Cost BasisTotal
Commercial, financial and agricultural: Commercial, financial and agricultural (1)
Risk rating
Pass267,016 208,078 100,736 52,705 36,528 59,909 468,749 1,193,721 
Special Mention1,608 1,592 429 59 277 — 11,986 15,951 
Substandard106 906 401 1,345 549 7,818 484 11,609 
Doubtful— 30 465 227 463 125 488 1,798 
Total 268,730 210,606 102,031 54,336 37,817 67,852 481,707 1,223,079 

Commercial, financial and agricultural: PPP
Risk rating
Pass$69,588 $4,832 $— $— $— $— $— $74,420 
Special Mention— — — — — — — — 
Substandard— — — — — — — — 
Doubtful— — — — — — — — 
Total$69,588 $4,832 $— $— $— $— $— $74,420 

Commercial real estate (1)
Risk rating
Pass376,468 445,780 263,786 154,637 115,571 317,371 14,890 1,688,503 
Special Mention786 6,206 32,965 9,354 4,297 17,829 996 72,433 
Substandard3,897 2,578 1,385 11,373 5,967 14,541 450 40,191 
Doubtful— — — — 47 618 — 665 
Total381,151 454,564 298,136 175,364 125,882 350,359 16,336 1,801,792 

Construction real estate: Commercial
Risk rating
Pass96,929 76,867 7,003 4,841 1,856 3,412 22,444 213,352 
Special Mention202 — — 691 — — — 893 
Substandard— 52 — 264 — — — 316 
Doubtful— — — — — — — — 
Total97,131 76,919 7,003 5,796 1,856 3,412 22,444 214,561 

Residential Real Estate: Commercial
Risk rating
Pass138,801 165,202 67,921 44,896 26,583 70,434 15,507 529,344 
Special Mention95 884 106 79 — 497 135 1,796 
Substandard735 22 691 41 95 993 29 2,606 
Doubtful56 — — — — — — 56 
Total139,687 166,108 68,718 45,016 26,678 71,924 15,671 533,802 

Leases
Risk rating
Pass6,705 5,729 2,628 2,151 705 845 — 18,763 
Special Mention198 111 184 67 21 — — 581 
Substandard— 698 — 23 19 78 — 818 
Doubtful— — 332 16 22 — — 370 
Total6,903 6,538 3,144 2,257 767 923 — 20,532 
December 31, 2021Term Loans Amortized Cost Basis by Origination Year
(In thousands)20212020201920182017PriorRevolving Loans Amortized Cost BasisTotal

Total Commercial Loans
Risk rating
Pass955,507 906,488 442,074 259,230 181,243 451,971 521,590 3,718,103 
Special Mention2,889 8,793 33,684 10,250 4,595 18,326 13,117 91,654 
Substandard4,738 4,256 2,477 13,046 6,630 23,430 963 55,540 
Doubtful56 30 797 243 532 743 488 2,889 
Total963,190 919,567 479,032 282,769 193,000 494,470 536,158 3,868,186 

(1) Included within each of commercial, financial and agricultural loans and commercial real estate loans is an immaterial amount of consumer loans that are not broken out by class.

The table below presents the recorded investment by loan grade at December 31, 2020 for all commercial loans:
 
December 31, 2020
(In thousands)5 Rated6 RatedNonaccrual and Accruing TDRsPCIPass-RatedRecorded
Investment
Commercial, financial and agricultural (1)
14,638 — 28,880 337 1,551,662 $1,595,517 
Commercial real estate (1)
87,439 117 70,357 7,461 1,588,832 1,754,206 
Construction real estate:
  Commercial164 — 3,110 1,002 223,287 227,563 
Residential real estate:
  Commercial798 22 4,557 1,510 520,496 527,383 
Leases331 — 1,595 112 22,414 24,452 
Total Commercial Loans$103,370 $139 $108,499 $10,422 $3,906,691 $4,129,121 

(1) Included within each of commercial, financial and agricultural loans and commercial real estate loans is an immaterial amount of consumer loans that were not broken out by class.
Park considers the performance of the loan portfolio and its impact on the allowance for credit losses. For residential and consumer loan classes, Park also evaluates credit quality based on the aging status of the loan, which was previously presented, and by performing status. The following tables present the amortized cost in residential and consumer loans based on performing status. Park defines a loan as nonperforming if it is on nonaccrual status, designated as an accruing TDR, or is greater than 90 days past due and accruing.

December 31, 2021Term Loans Amortized Cost Basis by Origination Year
(In thousands)20212020201920182017PriorRevolving Loans Amortized Cost BasisTotal
Commercial, financial and agricultural: Overdrafts
Performing1,127 — — — — — — 1,127 
Nonperforming— — — — — — — — 
Total 1,127 — — — — — — 1,127 

Construction Real Estate: Retail
Performing68,374 26,247 5,710 2,743 1,505 1,842 79 106,500 
Nonperforming— 647 57 — — 21 — 725 
Total 68,374 26,894 5,767 2,743 1,505 1,863 79 107,225 

Residential Real Estate: Mortgage
Performing230,299 217,022 114,077 68,774 59,939 323,678 — 1,013,789 
Nonperforming— 626 785 824 574 17,060 — 19,869 
Total 230,299 217,648 114,862 69,598 60,513 340,738 — 1,033,658 

Residential Real Estate: HELOC
Performing400 — 121 58 41 2,640 159,952 163,212 
Nonperforming89 40 — 37 90 1,811 326 2,393 
Total 489 40 121 95 131 4,451 160,278 165,605 

Residential Real Estate: Installment
Performing— 3 418 111 1,049 2,471 — 4,052 
Nonperforming— 12 5 26 78 1,469 — 1,590 
Total — 15 423 137 1,127 3,940 — 5,642 

Consumer: Consumer
Performing649,638 505,555 259,230 119,222 64,699 62,136 22,664 1,683,144 
Nonperforming241 506 755 399 155 593 — 2,649 
Total 649,879 506,061 259,985 119,621 64,854 62,729 22,664 1,685,793 

Consumer: GFSC
Performing— 243 986 292 63 5 108 1,697 
Nonperforming— 9 73 5 9 — — 96 
Total — 252 1,059 297 72 5 108 1,793 

Consumer: Check loans
Performing— — — — — — 2,093 2,093 
Nonperforming— — — — — — — — 
Total — — — — — — 2,093 2,093 

Total Consumer Loans
Performing949,838 749,070 380,542 191,200 127,296 392,772 184,896 2,975,614 
Nonperforming
330 1,840 1,675 1,291 906 20,954 326 27,322 
Total 950,168 750,910 382,217 192,491 128,202 413,726 185,222 3,002,936 
Loans and Leases Acquired with Deteriorated Credit Quality
In conjunction with the NewDominion acquisition, Park acquired loans with a book value of $277.9 million as of the July 1, 2018 acquisition date. These loans were recorded at the initial fair value of $272.8 million. NewDominion loans acquired with deteriorated credit quality (ASC 310-30) with a book value of $5.1 million were recorded at the initial fair value of $4.9 million. In conjunction with the Carolina Alliance acquisition, Park acquired loans and leases with a book value of $589.7 million as of the April 1, 2019 acquisition date.Carolina Alliance loans and leases were recorded at the initial fair value of $578.6 million. Loans and leases acquired with deteriorated credit quality (ASC 310-30) with a book value of $19.9 million were recorded at the initial fair value of $18.4 million.

Upon adoption of CECL on January 1, 2021, $52,000 of the credit discount on PCD loans was reclassified to the allowance for credit losses. At December 31, 2021, there was no allowance for credit losses on PCD loans. The carrying amount of loans acquired with deteriorated credit quality at December 31, 2021 and December 31, 2020 was $7.1 million and $11.2 million, respectively.

Troubled Debt Restructurings
Management typically 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.

During the two years ended December 31, 2021, Park modified a total of 5,138 consumer loans, with an aggregate balance of $72.2 million, and modified a total of 1,406 commercial loans, with an aggregate balance of $488.1 million, in each case related to a hardship caused by the COVID-19 pandemic and responses thereto. Park has worked with borrowers and provided modifications in the form of either interest only deferral or principal and interest deferral, in each case, for initial periods of up to 90 days. As necessary, Park made available a second 90-day interest only deferral or principal and interest deferral bringing the total potential deferral period to six months. Modifications were structured in a manner to best address each individual customer's then current situation. A majority of these modifications were excluded from TDR classification under Section 4013 of the CARES Act or under applicable interagency guidance of the federal banking regulators. The modified loans are considered current and continue to accrue interest during the deferral period.

Certain loans which were modified during the years ended December 31, 2021 and 2020 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.

The terms of certain other loans were modified during the years ended December 31, 2021 and 2020 that did not meet the definition of a TDR. Excluding COVID-19 related modifications, there were $0.2 million of substandard commercial loans modified during each of the years ended December 31, 2021 and December 31, 2020 which did not meet the definition of a TDR. Excluding COVID-19 related modifications, consumer loans modified during 2021 which did not meet the definition of a TDR had a total amortized cost as of December 31, 2021 of $32.9 million. Excluding COVID-19 related modifications, consumer loans modified during 2020 which did not meet the definition of a TDR had a total recorded investment as of December 31, 2020 of $57.9 million. Many of these loans were to borrowers who were not experiencing financial difficulties but who were looking to reduce their cost of funds.

At December 31, 2021 and 2020, there were $20.9 million and $25.8 million, respectively, of TDRs included in the nonaccrual loan totals. At December 31, 2021 and 2020, $10.5 million and $12.9 million, respectively, of these nonaccrual TDRs were performing in accordance with the terms of the restructured notes. At December 31, 2021 and 2020, loans totaling $28.3 million and $20.9 million, respectively, were included in accruing TDR loan totals. Management will continue to review the restructured loans and may determine it is appropriate to move certain nonaccrual TDRs to accrual status in the future.

At December 31, 2021 and 2020, Park had commitments to lend $3.0 million and $6.7 million, respectively, of additional funds to borrowers whose outstanding loan terms had been modified in a TDR.
At December 31, 2021 and 2020, there were $0.3 million and $0.2 million, respectively, of specific reserves related to TDRs. Modifications made in 2021 and 2020 were largely the result of renewals and extending the maturity date of the loans at terms consistent with the original notes. 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 $174,000 were recorded during the year ended December 31, 2021, as a result of TDRs identified in the 2021 year. Additional specific reserves of $7,000 were recorded during the year ended December 31, 2020, as a result of TDRs identified in the 2020 year. Additional specific reserves of $1,300 were recorded during the year ended December 31, 2019, as a result of TDRs identified in the 2019 year.

Quarterly, 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 did not contain a concessionary interest rate or other concessionary terms and the terms of the renewal/modification are considered to be market terms based on the current risk characteristics of the borrower, management considers the potential removal of the TDR classification. If deemed appropriate, the TDR classification is removed if 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, 2021 and 2020, Park removed the TDR classification on $4.1 million and $2.3 million, respectively, of loans that met the requirements discussed above.

The following tables detail the number of contracts modified as TDRs during the years ended December 31, 2021, 2020 and 2019 as well as the amortized cost/ recorded investment of these contracts at December 31, 2021, 2020, and 2019. The amortized cost/ 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, 2021
(In thousands)Number of ContractsAccruingNonaccrualAmortized
Cost
Commercial, financial and agricultural
Commercial, financial and agricultural10$1,356 $169 $1,525 
PPP loans— — — — 
Overdrafts— — — — 
Commercial real estate15 2,002 6,747 8,749 
Construction real estate:
Commercial1 — — — 
   Retail2 — 705 705 
Residential real estate:
Commercial5 95 574 669 
Mortgage14 146 396 542 
HELOC8 211 105 316 
Installment8 120 — 120 
Consumer:
Consumer131 116 417 533 
GFSC— — — — 
Check loans— — — — 
Leases1 — 325 325 
Total loans195$4,046 $9,438 $13,484 
Year ended
December 31, 2020
(In thousands)Number of ContractsAccruingNonaccrualRecorded Investment
Commercial, financial and agricultural12$107 $3,706 $3,813 
Commercial real estate9— 3,235 3,235 
Construction real estate:
Commercial— — — — 
Mortgage1 26 — 26 
Installment1 — 14 14 
Residential real estate:
Commercial3153 3 156 
Mortgage27888 1,068 1,956 
HELOC714 52 66 
Installment18163 65 228 
Consumer214218 634 852 
Total loans292$1,569 $8,777 $10,346 
 
Year ended
December 31, 2019
(In thousands)Number of ContractsAccruingNonaccrualRecorded Investment
Commercial, financial and agricultural30$6,040 $7,821 $13,861 
Commercial real estate8415 7,855 8,270 
Construction real estate:
Commercial3— 415 415 
Mortgage2 77 — 77 
Installment— — — — 
Residential real estate:
Commercial3— 100 100 
Mortgage21535 589 1,124 
HELOC18126 234 360 
Installment341,047 28 1,075 
Consumer324225 1,166 1,391 
Total loans443$8,465 $18,208 $26,673 
 
Of those loans which were modified and determined to be a TDR during the year ended December 31, 2021, $5.4 million were on nonaccrual status as of December 31, 2020. Of those loans which were modified and determined to be a TDR during the year ended December 31, 2020, $0.4 million were on nonaccrual status as of December 31, 2019. Of those loans which were modified and determined to be a TDR during the year ended December 31, 2019, $2.1 million were on nonaccrual status as of December 31, 2018.

The following table presents the amortized cost/ 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, 2021, December 31, 2020, and December 31, 2019. 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 credit loss resulting from the defaults on TDR loans was immaterial.
 
Year ended
December 31, 2021		Year ended
December 31, 2020		Year ended
December 31, 2019
(In thousands)Number of ContractsAmortized CostNumber of ContractsRecorded InvestmentNumber of ContractsRecorded Investment
Commercial, financial and agricultural:4 $2,776 1 $20 
Commercial, financial and agricultural— $— (1)(1)(1)(1)
PPP loans— — (1)(1)(1)(1)
Overdrafts— — (1)(1)(1)(1)
Commercial real estate— — 1 223 — — 
Construction real estate:
Commercial— — — — — — 
Retail1 648 1 14 — — 
Residential real estate:
Commercial— — 1 3 — — 
Mortgage4 280 11 993 7 665 
HELOC2 135 — — 6 141 
Installment1 27 3 32 — — 
Consumer34 360 56 539 
Consumer14 169 (1)(1)(1)(1)
GFSC— — (1)(1)(1)(1)
Check loans— — (1)(1)(1)(1)
Leases— — — — — — 
Total loans22 $1,259 55 $4,401 70 $1,365 
(1) Results for reporting periods beginning after January 1, 2021 are presented under ASC 326, while prior period amounts continue to be reported in accordance with previously applicable U.S. GAAP. Category was not broken out as a separate class at December 31, 2020.

Of the $1.3 million in modified TDRs which defaulted during the year ended December 31, 2021, $115,000 were accruing loans and $1.1 million were nonaccrual loans. Of the $4.4 million in modified TDRs which defaulted during the year ended December 31, 2020, $706,000 were accruing loans and $3.7 million were nonaccrual loans. Of the $1.4 million in modified TDRs which defaulted during the year ended December 31, 2019, $350,000 were accruing loans and $1.0 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, 2021 and 2020, credit exposure aggregating approximately $33.5 million and $51.3 million, respectively, was outstanding to such parties. Of this total exposure, approximately $27.1 million and $32.0 million was outstanding at December 31, 2021 and 2020, respectively, with the remaining balance representing available credit. During 2021, new loans and advances on existing loans were made to these executive officers, directors and related entities of directors totaling $1.2 million and $9.7 million, respectively. These extensions of credit were offset by principal payments of $12.6 million and the removal of loans from the related party listing totaling $3.2 million. During 2020, new loans and advances on existing loans were $0.6 million and $12.4 million, respectively. These extensions of credit were offset by principal payments of $9.7 million.