Allowance for Loan Losses and Credit Quality Information (Tables)

9 Months Ended

Sep. 30, 2014

Schedule of Allowance for Loan Losses and Loan Balances

The following tables provide the activity of our allowance for loan losses and loan balances for the three and nine months ended September 30, 2014 and 2013:


	Commercial			Owner - Occupied Commercial			Commercial Mortgages			Construction			Residential			Consumer			Estimation / Complexity Risk (1)			Total
	(in thousands)
Three months ended September 30, 2014
Allowance for loan losses
Beginning balance	$	13,346		$	7,986		$	7,617		$	2,319		$	2,759		$	6,299		$	1,055		$	41,381
Charge-offs		(1,840	)		(272	)		(101	)		—			(147	)		(372	)		—			(2,732	)
Recoveries		66			77			4			8			86			261			—			502
Provision (credit)		1,833			454			(1,097	)		(897	)		(6	)		56			(10	)		333

Ending balance	$	13,405		$	8,245		$	6,423		$	1,430		$	2,692		$	6,244		$	1,045		$	39,484


Nine months ended September 30, 2014
Allowance for loan losses
Beginning balance	$	12,751		$	7,638		$	6,932		$	3,326		$	3,078		$	6,494		$	1,025		$	41,244
Charge-offs		(3,335	)		(593	)		(261	)		(88	)		(674	)		(2,095	)		—			(7,046	)
Recoveries		873			244			43			192			129			792			—			2,27	3
Provision (credit)		3,116			956			(291	)		(2,000	)		159			1,053			20			3,013

Ending balance	$	13,405		$	8,245		$	6,423		$	1,430		$	2,692		$	6,244		$	1,045		$	39,484


Period-end allowance allocated to:
Loans individually evaluated for impairment	$	1,573		$	993		$	240		$	—		$	850		$	211		$	—		$	3,867
Loans collectively evaluated for impairment		11,832			7,252			6,183			1,430			1,842			6,033			1,045			35,617

Ending balance	$	13,405		$	8,245		$	6,423		$	1,430		$	2,692		$	6,244		$	1,045		$	39,484


Period-end loan balances evaluated for:
Loans individually evaluated for impairment	$	3,683		$	3,390		$	8,760		$	1,419		$	16,807		$	6,610		$	—		$	40,669	(2)
Purchased credit impaired loans		5,908			2,728			7,892			5,202			623			45			—			22,398

Loans collectively evaluated for impairment		872,679			802,139			777,260			141,595			211,791			319,131			—			3,124,595

Ending balance	$	882,270		$	808,257		$	793,912		$	148,216		$	229,221		$	325,786		$	—		$	3,187,662	(3)


	Commercial			Owner - Occupied Commercial			Commercial Mortgages			Construction			Residential			Consumer			Estimation/ Complexity Risk (1)			Total
	(in thousands)
Three months ended September 30, 2013
Allowance for loan losses
Beginning balance	$	12,967		$	8,049		$	6,345		$	3,952		$	3,230		$	6,137		$	814		$	41,494
Charge-offs		(1,172	)		(31	)		(103	)		(4	)		(290	)		(1,343	)		—			(2,943	)
Recoveries		273			55			333			21			10			219			—			911
Provision (credit)		594			(23	)		345			(380	)		364			1,071			(2	)		1,969

Ending balance	$	12,662		$	8,050		$	6,920		$	3,589		$	3,314		$	6,084		$	812		$	41,431


Nine months ended September 30, 2013
Allowance for loan losses
Beginning balance	$	13,663		$	6,108		$	8,079		$	6,456		$	3,124		$	5,631		$	861		$	43,922
Charge-offs		(2,311	)		(68	)		(1,824	)		(1,344	)		(985	)		(4,153	)		—			(10,685	)
Recoveries		900			100			442			106			51			715			—			2,314
Provision (credit)		410			1,910			223			(1,629	)		1,124			3,891			(49	)		5,880

Ending balance	$	12,662		$	8,050		$	6,920		$	3,589		$	3,314		$	6,084		$	812		$	41,431


Period-end allowance allocated to:
Loans individually evaluated for impairment	$	2,004		$	945		$	1,995		$	—		$	995		$	12		$	—		$	5,951
Loans collectively evaluated for impairment		10,658			7,105			4,925			3,589			2,319			6,072			812			35,480

Ending balance	$	12,662		$	8,050		$	6,920		$	3,589		$	3,314		$	6,084		$	812		$	41,431


Period-end loan balances evaluated for:
Loans individually evaluated for impairment	$	5,833		$	12,568		$	8,894		$	274		$	17,360		$	4,400		$	—		$	49,329	(2)
Loans collectively evaluated for impairment		748,106			777,297			704,895			102,347			211,595			283,645			—			2,827,885

Ending balance	$	753,939		$	789,865		$	713,789		$	102,621		$	228,955		$	288,045		$	—		$	2,877,214	(3)

(1)	Represents the portion of the allowance for loan losses established to account for the inherent complexity and uncertainty of estimates.

(2)	The difference between this amount and nonaccruing loans at September 30, 2014, represents accruing troubled debt restructured (“TDR”) loans which are considered to be impaired loans.

(3)	Ending loan balances do not include deferred costs of $6.7 million for September 30, 2014 and $5.8 million for September 30, 2013.

Summary of Nonaccrual and Past Due Loans

The following tables show our nonaccrual and past due loans at the dates indicated:

September 30, 2014

(In Thousands)

30–59 Days
Past Due and
Still Accruing

60–89 Days
Past Due and
Still Accruing

Greater Than
90 Days
Past Due and
Still Accruing

Total Past
Due
And Still
Accruing

Accruing
Current
Balances

Acquired
Impaired
Loans

Nonaccrual
Loans

Total
Loans

Commercial

299

10,765

—

11,064

862,223

5,908

3,075

882,270

Owner-Occupied commercial

734

5,561

—

6,295

795,844

2,728

3,390

808,257

Commercial mortgages

—

777,252

7,892

8,670

793,912

Construction

—

142,954

5,202

—

148,216

Residential

2,756

937

678

4,371

216,279

623

7,948

229,221

Consumer

861

397

—

1,258

320,790

3,693

325,786

Total

4,727

17,741

678

23,146

3,115,342

22,398

26,776

3,187,662

% of Total Loans

0.15

0.56

0.02

0.73

97.73

0.70

0.84

100


December 31, 2013 (In Thousands)	30–59 Days Past Due and Still Accruing			60–89 Days Past Due and Still Accruing			Greater Than 90 Days Past Due and Still Accruing			Total Past Due And Still Accruing			Accruing Current Balances			Nonaccrual Loans			Total Loans
Commercial	$	1,447		$	—		$	—		$	1,447		$	805,132		$	4,303		$	810,882
Owner-Occupied commercial		538			—			—			538			780,625			5,197			786,360
Commercial mortgages		83			1,049			—			1,132			715,496			8,565			725,193
Construction		—			—			—			—			104,916			1,158			106,074
Residential		1,952			1,348			533			3,833			209,255			8,432			221,520
Consumer		1,095			177			—			1,272			297,669			3,293			302,234


Total	$	5,115		$	2,574		$	533		$	8,222		$	2,913,093		$	30,948		$	2,952,263

% of Total Loans		0.17	%		0.09	%		0.02	%		0.28	%		98.67	%		1.05	%		100	%

Analysis of Impaired Loans

The following tables provide an analysis of our impaired loans at September 30, 2014 and December 31, 2013:


September 30, 2014 (In Thousands)	Ending Loan Balances		Loans with No Specific Reserve (1)		Loans with Specific Reserve		Related Specific Reserve		Contractual Principal Balances		Average Loan Balances

Commercial	$	3,683	$	1,480	$	2,203	$	1,573	$	4,612	$	4,642
Owner-Occupied commercial		3,390		1,857		1,533		993		4,338		6,480
Commercial mortgages		8,760		5,136		3,624		240		11,667		11,117
Construction		1,419		1,419		—		—		1,419		784
Residential		16,807		9,215		7,592		850		19,045		17,635
Consumer		6,610		5,228		1,382		211		7,332		5,507


Total	$	40,669	$	24,335	$	16,334	$	3,867	$	48,413	$	46,165


December 31, 2013 (In Thousands)	Ending Loan Balances		Loans with No Specific Reserve (1)		Loans with Specific Reserve		Related Specific Reserve		Contractual Principal Balances		Average Loan Balances
Commercial	$	5,003	$	2,362	$	2,641	$	1,781	$	13,013	$	5,347
Owner-Occupied commercial		5,197		5,184		12		12		8,293		11,542
Commercial mortgages		8,661		2,784		5,877		1,987		16,566		10,444
Construction		1,158		1,158		—		—		1,563		968
Residential		17,852		9,750		8,103		989		20,153		18,047
Consumer		5,411		4,767		644		134		6,056		5,455


Total	$	43,282	$	26,005	$	17,277	$	4,903	$	65,644	$	51,803

(1)	Reflects loan balances at or written down to their remaining book balance.

Analysis of Problem Loans, by Credit Risk Profile Using Internally Assigned Risk Ratings

The following tables provide an analysis of loans by credit risk profile using internally assigned risk ratings, as of September 30, 2014 and December 31, 2013

Commercial Credit Exposure


	Commercial				Owner-Occupied Commercial				Commercial Mortgages				Construction				Total Commercial
	Sept. 30 2014		Dec. 31 2013		Sept. 30 2014		Dec. 31 2013		Sept. 30 2014		Dec. 31 2013		Sept. 30 2014		Dec. 31 2013		September 30, 2014					December 31, 2013
(in thousands)	Sept. 30 2014		Dec. 31 2013		Sept. 30 2014		Dec. 31 2013		Sept. 30 2014		Dec. 31 2013		Sept. 30 2014		Dec. 31 2013		Amount		%			Amount		%
Risk Rating:
Special mention	$	10,363	$	12,566	$	13,247	$	4,747	$	12,141	$	2,092	$	1,073	$	226	$	36,824				$	19,631
Substandard:
Accrual		62,453		56,806		43,382		45,181		12,107		8,146		5,254		3,599		123,196					113,732
Nonaccrual		1,572		2,362		2,041		5,185		6,925		2,784		313		1,158		10,851					11,489
Doubtful /
Nonaccrual		2,203		2,641		1,533		12		3,624		5,877		—		—		7,360					8,530

Total Special Mention, Substandard and Doubtful		76,591		74,375		60,203		55,125		34,797		18,899		6,640		4,983		178,231		6	%		153,382		6	%
Pass		805,679		736,507		748,054		731,235		759,115		706,294		141,576		101,091		2,454,424		94	%		2,275,127		94

Total Commercial Loans	$	882,270	$	810,882	$	808,257	$	786,360	$	793,912	$	725,193	$	148,216	$	106,074	$	2,632,655		100	%	$	2,428,509		100	%

Schedule of Consumer Credit Exposure

Consumer Credit Exposure


	Residential				Consumer				Total Residential and Consumer
	Sept. 30 2014		Dec. 31 2013		Sept. 30 2014		Dec. 31 2013		September 30, 2014					December 31, 2013
(in thousands)	Sept. 30 2014		Dec. 31 2013		Sept. 30 2014		Dec. 31 2013		Amount		Percent			Amount		Percent

Nonperforming (1)	$	16,807	$	17,852	$	6,610	$	5,411	$	23,417		4	%	$	23,263		4	%
Performing		212,414		203,668		319,176		296,823		531,590		96	%		500,491		96

Total	$	229,221	$	221,520	$	325,786	$	302,234	$	555,007		100	%	$	523,754		100	%

(1)	Includes $12.1 million as of September 30, 2014 and $11.5 million as of December 31, 2013 of troubled debt restructured mortgages and home equity installment loans that are performing in accordance with modified terms and are accruing interest.

Schedule of Loans Identified as Troubled Debt Restructurings During Periods Indicated

The following table presents loans identified as TDRs during the three and nine months ended September 30, 2014 and 2013:


(In Thousands)	Three Months Ended September 30, 2014		Three Months Ended September 30, 2013		Nine Months Ended September 30, 2014		Nine Months Ended September 30, 2013

Commercial	$	88	$	6,800	$	209	$	6,824
Commercial mortgages		3,430		108		3,430		1,169
Construction		1,419		—		1,419		—
Residential		72		207		1,916		806
Consumer		1,097		256		1,612		973


Total	$	6,106	$	7,371	$	8,586	$	9,772