Allowance for Loan Losses (Tables)

12 Months Ended

Dec. 31, 2015

Changes in the Allowance for Loan Losses and Loan Balances Outstanding

The following tables present, by portfolio segment, the changes in the allowance for loan losses, the ending allocation of the allowance for loan losses and the loan balances outstanding for the years ended December 31, 2015 and December 31, 2014. The changes can be impacted by overall loan volume, adversely graded loans, historical charge-offs and economic factors.


	Beginning balance		Charge-offs			Recoveries		Provision			Ending Balance
Allowance for loan losses:
December 31, 2015
Commercial & Agriculture	$	1,819	$	(190	)	$	182	$	(333	)	$	1,478
Commercial Real Estate:
Owner Occupied		2,221		(523	)		187		582			2,467
Non-Owner Occupied		4,334		(81	)		115		289			4,657
Residential Real Estate		3,747		(1,135	)		331		1,143			4,086
Real Estate Construction		428		—			5		(62	)		371
Farm Real Estate		822		—			76		(360	)		538
Consumer and Other		200		(120	)		46		256			382
Unallocated		697		—			—		(315	)		382

Total	$	14,268	$	(2,049	)	$	942	$	1,200		$	14,361


	Beginning balance		Charge-offs			Recoveries		Provision			Ending Balance
Allowance for loan losses:
December 31, 2014
Commercial & Agriculture	$	2,838	$	(338	)	$	251	$	(932	)	$	1,819
Commercial Real Estate:
Owner Occupied		2,931		(1,661	)		360		591			2,221
Non-Owner Occupied		3,888		(198	)		50		594			4,334
Residential Real Estate		5,224		(2,449	)		293		679			3,747
Real Estate Construction		184		—			6		238			428
Farm Real Estate		740		—			—		82			822
Consumer and Other		217		(135	)		61		57			200
Unallocated		506		—			—		191			697

Total	$	16,528	$	(4,781	)	$	1,021	$	1,500		$	14,268


	Beginning balance		Charge- offs			Recoveries		Provision			Ending Balance
Allowance for loan losses:
December 31, 2013
Commercial & Agriculture	$	2,811	$	(483	)	$	141	$	369		$	2,838
Commercial Real Estate:
Owner Occupied		4,565		(989	)		265		(910	)		2,931
Non-Owner Occupied		4,942		(815	)		184		(423	)		3,888
Residential Real Estate		5,780		(2,800	)		391		1,853			5,224
Real Estate Construction		349		(136	)		108		(137	)		184
Farm Real Estate		632		(107	)		67		148			740
Consumer and Other		246		(220	)		80		111			217
Unallocated		417		—			—		89			506

Total	$	19,742	$	(5,550	)	$	1,236	$	1,100		$	16,528


	Loans acquired with credit deterioration		Loans individually evaluated for impairment		Loans collectively evaluated for impairment		Total
December 31, 2015
Allowance for loan losses:

Commercial & Agriculture	$	—	$	23	$	1,455	$	1,478
Commercial Real Estate:
Owner Occupied		—		103		2,364		2,467
Non-Owner Occupied		—		—		4,657		4,657
Residential Real Estate		123		137		3,826		4,086
Real Estate Construction		—		—		371		371
Farm Real Estate		—		—		538		538
Consumer and Other		—		—		382		382
Unallocated		—		—		382		382

Total	$	123	$	263	$	13,975	$	14,361

Outstanding loan balances:

Commercial & Agriculture	$	132	$	873	$	123,397	$	124,402
Commercial Real Estate:
Owner Occupied		—		2,141		165,756		167,897
Non-Owner Occupied		—		1,742		346,697		348,439
Residential Real Estate		131		1,642		234,565		236,338
Real Estate Construction		—		—		58,898		58,898
Farm Real Estate		—		953		46,040		46,993
Consumer and Other		—		3		18,557		18,560

Total	$	263	$	7,354	$	993,910	$	1,001,527


	Loans acquired with credit deterioration		Loans individually evaluated for impairment		Loans collectively evaluated for impairment		Total
December 31, 2014
Allowance for loan losses:

Commercial & Agriculture	$	—	$	641	$	1,178	$	1,819
Commercial Real Estate:
Owner Occupied		—		4		2,217		2,221
Non-Owner Occupied		—		20		4,314		4,334
Residential Real Estate		—		305		3,442		3,747
Real Estate Construction		—		—		428		428
Farm Real Estate		—		53		769		822
Consumer and Other		—		—		200		200
Unallocated		—		—		697		697

Total	$	—	$	1,023	$	13,245	$	14,268


Outstanding loan balances:

Commercial & Agriculture	$	—	$	2,304	$	110,961	$	113,265
Commercial Real Estate:
Owner Occupied		—		3,348		139,666		143,014
Non-Owner Occupied		—		2,176		306,490		308,666
Residential Real Estate		—		3,108		211,429		214,537
Real Estate Construction		—		—		65,452		65,452
Farm Real Estate		—		208		53,765		53,973
Consumer and Other		—		5		15,945		15,950

Total	$	—	$	11,149	$	903,708	$	914,857

Credit Exposures by Internally Assigned Grades


	Pass		Special Mention		Substandard		Doubtful		Ending Balance
December 31, 2015
Commercial & Agriculture	$	117,739	$	3,090	$	3,573	$	—	$	124,402
Commercial Real Estate:
Owner Occupied		156,622		5,571		5,704		—		167,897
Non-Owner Occupied		339,734		6,100		2,605		—		348,439
Residential Real Estate		62,147		1,671		7,435		—		71,253
Real Estate Construction		52,399		216		29		—		52,644
Farm Real Estate		39,787		4,024		3,182		—		46,993
Consumer and Other		1,987		3		111		—		2,101

Total	$	770,415	$	20,675	$	22,639	$	—	$	813,729


	Pass		Special Mention		Substandard		Doubtful		Ending Balance
December 31, 2014
Commercial & Agriculture	$	106,989	$	3,446	$	2,830	$	—	$	113,265
Commercial Real Estate:
Owner Occupied		129,849		4,378		8,787		—		143,014
Non-Owner Occupied		299,167		5,682		3,817		—		308,666
Residential Real Estate		49,249		697		8,833		—		58,779
Real Estate Construction		59,584		19		41		—		59,644
Farm Real Estate		51,416		1,737		820		—		53,973
Consumer and Other		1,567		—		53		—		1,620

Total	$	697,821	$	15,959	$	25,181	$	—	$	738,961

Performing and Nonperforming Loans

Certain TDRs are classified as nonperforming at the time of restructure and may only be returned to performing status after considering the borrower’s sustained repayment performance for a reasonable period, generally six months.


	Residential Real Estate		Real Estate Construction		Consumer and Other		Total
December 31, 2015

Performing	$	165,048	$	6,254	$	16,458	$	187,760
Nonperforming		37		—		1		38

Total	$	165,085	$	6,254	$	16,459	$	187,798


	Residential Real Estate		Real Estate Construction		Consumer and Other		Total
December 31, 2014
Performing	$	155,758	$	5,808	$	14,312	$	175,878
Nonperforming		—		—		18		18

Total	$	155,758	$	5,808	$	14,330	$	175,896

Aging Analysis of Past Due Loans

The following tables include an aging analysis of the recorded investment of past due loans outstanding as of December 31, 2015 and 2014.


	30-59 Days Past Due		60-89 Days Past Due		90 Days or Greater		Total Past Due		Current		Total Loans		Past Due 90 Days and Accruing
December 31, 2015
Commercial & Agriculture	$	9	$	32	$	37	$	78	$	124,324	$	124,402	$	—
Commercial Real Estate:
Owner Occupied		982		36		284		1,302		166,595		167,897		—
Non-Owner Occupied		269		330		123		722		347,717		348,439		—
Residential Real Estate		2,845		404		1,725		4,974		231,364		236,338		—
Real Estate Construction		8		—		—		8		58,890		58,898		—
Farm Real Estate		—		—		—		—		46,993		46,993		—
Consumer and Other		98		68		8		174		18,386		18,560		—

Total	$	4,211	$	870	$	2,177	$	7,258	$	994,269	$	1,001,527	$	—


	30-59 Days Past Due		60-89 Days Past Due		90 Days or Greater		Total Past Due		Current		Total Loans		Past Due 90 Days and Accruing
December 31, 2014
Commercial & Agriculture	$	58	$	—	$	187	$	245	$	113,020	$	113,265	$	—
Commercial Real Estate:		622		251		656		1,529		141,485		143,014		—
Owner Occupied
Non-Owner Occupied		520		5		2,103		2,628		306,038		308,666		—
Residential Real Estate		1,923		721		2,177		4,821		209,716		214,537		—
Real Estate Construction		33		—		8		41		65,411		65,452		—
Farm Real Estate		—		—		171		171		53,802		53,973		—
Consumer and Other		131		9		37		177		15,773		15,950		18

Total	$	3,287	$	986	$	5,339	$	9,612	$	905,245	$	914,857	$	18

Summary of Nonaccrual Loans

The following table presents loans on nonaccrual status as of December 31, 2015 and 2014.


	2015		2014
Commercial & Agriculture	$	1,185	$	1,264
Commercial Real Estate:
Owner Occupied		1,645		3,403
Non-Owner Occupied		1,428		2,134
Residential Real Estate		4,542		6,280
Real Estate Construction		29		41
Farm Real Estate		961		394
Consumer and Other		100		42

Total	$	9,890	$	13,558

Schedule of Troubled Debt Restructurings

Loan modifications that are considered TDRs completed during the twelve month periods ended December 31, 2015, 2014 and 2013 were as follows:


	For the Twelve Month Period Ended December 31, 2015
	Number of Contracts		Pre- Modification Outstanding Recorded Investment		Post- Modification Outstanding Recorded Investment
Commercial & Agriculture		—	$	—	$	—
Commercial Real Estate:
Owner Occupied		—		—		—
Non-Owner Occupied		—		—		—
Residential Real Estate		—		—		—
Real Estate Construction		1		41		41
Farm Real Estate		—		—		—
Consumer and Other		—		—		—

Total Loan Modifications		1	$	41	$	41


	For the Twelve Month Period Ended December 31, 2014
	Number of Contracts		Pre- Modification Outstanding Recorded Investment		Post- Modification Outstanding Recorded Investment
Commercial & Agriculture		—	$	—	$	—
Commercial Real Estate:
Owner Occupied		—		—		—
Non-Owner Occupied		—		—		—
Residential Real Estate		9		619		554
Real Estate Construction		1		35		35
Farm Real Estate		—		—		—
Consumer and Other		—		—		—

Total Loan Modifications		10	$	654	$	589


	For the Twelve Month Period Ended December 31, 2013
	Number of Contracts		Pre- Modification Outstanding Recorded Investment		Post- Modification Outstanding Recorded Investment
Commercial & Agriculture		—	$	—	$	—
Commercial Real Estate:
Owner Occupied		2		547		547
Non-Owner Occupied		—		—		—
Residential Real Estate		—		—		—
Real Estate Construction		—		—		—
Farm Real Estate		—		—		—
Consumer and Other		—		—		—

Total Loan Modifications		2	$	547	$	547

Impaired Financing Receivables

The following tables include the recorded investment and unpaid principal balances for impaired financing receivables with the associated allowance amount, if applicable, as of December 31, 2015 and 2014.


	December 31, 2015						December 31, 2014
	Recorded Investment		Unpaid Principal Balance		Related Allowance		Recorded Investment		Unpaid Principal Balance		Related Allowance
With no related allowance recorded:
Commercial & Agriculture	$	851	$	1,034			$	1,377	$	1,504
Commercial Real Estate:
Owner Occupied		1,224		1,343				2,961		3,327
Non-Owner Occupied		1,742		1,826				92		140
Residential Real Estate		965		1,591				1,893		3,487
Farm Real Estate		953		1,026				—		—
Consumer and Other		3		3				5		5

Total		5,738		6,823				6,328		8,463

With an allowance recorded:
Commercial & Agriculture		22		23	$	23		927		1,056	$	641
Commercial Real Estate:
Owner Occupied		917		999		103		388		387		4
Non-Owner Occupied		—		—		—		2,083		2,287		20
Residential Real Estate		808		683		260		1,215		1,223		305
Farm Real Estate		—		—		—		208		256		53

Total		1,747		1,705		386		4,821		5,209		1,023

Total:
Commercial & Agriculture		873		1,057		23		2,304		2,560		641
Commercial Real Estate:
Owner Occupied		2,141		2,342		103		3,349		3,714		4
Non-Owner Occupied		1,742		1,826		—		2,175		2,427		20
Residential Real Estate		1,773		2,274		260		3,108		4,710		305
Farm Real Estate		953		1,026		—		208		256		53
Consumer and Other		3		3		—		5		5		—

Total	$	7,485	$	8,528	$	386	$	11,149	$	13,672	$	1,023

The following tables include the average recorded investment and interest income recognized for impaired financing receivables as of, and for the years ended, December 31, 2015, 2014 and 2013.


	December 31, 2015				December 31, 2014
	Average Recorded Investment		Interest Income Recognized		Average Recorded Investment		Interest Income Recognized
For the year ended:
Commercial & Agriculture	$	1,519	$	72	$	3,316	$	104
Commercial Real Estate:
Owner Occupied		2,738		139		5,720		200
Non-Owner Occupied		1,946		32		2,767		40
Residential Real Estate		2,544		152		3,291		207
Real Estate Construction		16		—		—		—
Farm Real Estate		653		56		219		19
Consumer and Other		4		—		6		—

Total	$	9,420	$	451	$	15,319	$	570


	December 31, 2013
	Average Recorded Investment		Interest Income Recognized
For the year ended:
Commercial & Agriculture	$	4,761	$	186
Commercial Real Estate:
Owner Occupied		6,065		417
Non-Owner Occupied		5,855		85
Residential Real Estate		4,792		282
Real Estate Construction		302		—
Farm Real Estate		246		19
Consumer and Other		30		—

Total	$	22,051	$	989

Schedule of Changes in Amortized Yield for Purchased Credit Impaired Loans

Changes in the amortizable yield for purchased credit-impaired loans were as follows for the year ended December 31, 2015:


	At December 31, 2015
	(In Thousands)
Balance at beginning of period	$	—
Acquisition of impaired loans		140
Accretion		(60	)

Balance at end of period	$	80

Components of Purchase Accounting Adjustments, Loans Acquired with Credit Deterioration

The table below presents the components of the purchase accounting adjustments.


	March 6, 2015
Contractually required payments	$	1,305
Non-accretable discount		(691	)

Expected cash flows		614
Accretable discount		(140	)

Estimated fair value	$	474

Schedule of Loans Acquired and Accounted

The following table presents additional information regarding loans acquired and accounted for in accordance with ASC 310-30:


	At March 6, 2015		At December 31, 2015
	Acquired Loans with Specific Evidence of Deterioration of Credit Quality (ASC 310-30)		Acquired Loans with Specific Evidence of Deterioration of Credit Quality (ASC 310-30)
	(In Thousands)
Outstanding balance	$	1,305	$	965
Carrying amount		474		263