Loans And Leases | 5. Loans and leases The classifications of loans and leases at March 31, 2016 and December 31, 201 5 are summarized as follows: (dollars in thousands) March 31, 2016 December 31, 2015 Commercial and industrial $ 103,703 $ 102,653 Commercial real estate: Non-owner occupied 95,303 95,745 Owner occupied 98,523 101,652 Construction 4,904 4,481 Consumer: Home equity installment 30,017 30,935 Home equity line of credit 48,331 48,060 Auto loans and leases 29,556 29,758 Other 5,770 6,208 Residential: Real estate 130,270 126,992 Construction 10,109 10,060 Total 556,486 556,544 Less: Allowance for loan losses (9,384) (9,527) Unearned lease revenue (395) (335) Loans and leases, net $ 546,707 $ 546,682 Net deferred loan costs of $1.5 million have been included in the carrying values of loans at March 31, 2016 and December 31, 2015, respectively. Unearned lease revenue represents the difference between the lessor’s investment in the property and the gross investment in the lease. Unearned revenue is accrued over the life of the lease using the effective interest method. The Company services real estate loans for investors in the secondary mortgage market which are not included in the accompanying consolidated balance sheets. The approximate unpaid principal balance of mortgages serviced amounted to $269.6 million as of March 31, 2016 and $269.5 million as of December 31, 201 5 . Mortgage servicing rights amounted to $1.2 million both as of March 31, 2016 and December 31, 2015 , respectively. Management is responsible for conducting the Company’s credit risk evaluation process, which includes credit risk grading of individual commercial and industrial and commercial real estate loans. Commercial and industrial and commercial real estate loans are assigned credit risk grades based on the Company’s assessment of conditions that affect the borrower’s ability to meet its contractual obligations under the loan agreement. That process includes reviewing borrowers’ current financial information, historical payment experience, credit documentation, public information and other information specific to each individual borrower. Upon review, the commercial loan credit risk grade is revised or reaffirmed as the case may be. The credit risk grades may be changed at any time management feels an upgrade or downgrade may be warranted. The Company utilizes an external independent loan review firm that reviews and validates the credit risk program on at least an annual basis. Results of these reviews are presented to management and the board of directors. The loan review process complements and reinforces the risk identification and assessment decisions made by lenders and credit personnel, as well as the Company’s policies and procedures. Non-accrual loans The decision to place loans on non-accrual status is made on an individual basis after considering factors pertaining to each specific loan. Commercial and industrial (C&I) and commercial real estate (CRE) loans are placed on non-accrual status when management has determined that payment of all contractual principal and interest is in doubt or the loan is past due 90 days or more as to principal and interest, unless well-secured and in the process of collection. Consumer loans secured by real estate and residential mortgage loans are placed on non-accrual status at 120 days past due as to principal and interest and unsecured consumer loans are charged-off when the loan is 90 days or more past due as to principal and interest. The Company considers all non-accrual loans to be impaired loans. Non-accrual loans, segregated by class, at March 31, 2016 and December 31, 201 5 , were as follows: (dollars in thousands) March 31, 2016 December 31, 2015 Commercial and industrial $ 32 $ 30 Commercial real estate: Non-owner occupied 6,178 6,193 Owner occupied 559 988 Construction 218 226 Consumer: Home equity installment 92 167 Home equity line of credit 438 512 Auto loans and leases 23 45 Other 6 6 Residential: Real estate 760 836 Total $ 8,306 $ 9,003 Troubled Debt Restructuring A modification of a loan constitutes a troubled debt restructuring (TDR) when a borrower is experiencing financial difficulty and the modification constitutes a concession. The Company considers all TDRs to be impaired loans. The Company offers various types of concessions when modifying a loan, however, forgiveness of principal is rarely granted. C&I loans modified in a TDR often involve temporary interest-only payments, term extensions, and converting revolving credit lines to term loans. Additional collateral, a co-borrower, or a guarantor is often requested. CRE loans modified in a TDR can involve reducing the interest rate for the remaining term of the loan, extending the maturity date at an interest rate lower than the current market rate for new debt with similar risk, or substituting or adding a new borrower or guarantor. Commercial real estate construction loans modified in a TDR may also involve extending the interest-only payment period. Residential mortgage loans modified in a TDR are primarily comprised of loans where monthly payments are lowered to accommodate the borrowers’ financial needs for an extended period of time. After the lowered monthly payment period ends, the borrower would revert back to paying principal and interest pursuant to the original terms with the maturity date adjusted accordingly. Consumer loan modifications are typically not granted and therefore standard modification terms do not exist for loans of this type. Loans modified in a TDR may or may not be placed on non-accrual status. As of March 31, 2016, total TDRs amounted to $3.0 million, consisting of 10 loans ( 7 CRE loans, 2 C &I loans and 1 HELOC to 6 unrelated borrowers ), of which 2 of the CRE loans, totaling $0.2 million, were on non-accrual status. The first quarter 2016 balance represents a $0.6 million incr ease over the December 31, 2015 balance, which amounted to $2.4 million (consisting of 7 CRE loans and 2 C&I loans to 5 unrelated borrowers) , with none of these loans on non-accrual status. The increase in the first quarter of 2016 was attributed to the addition of a $0.7 million HELOC into the TDR classification. Of the TDRs outstanding as of March 31, 2016 and December 31, 2015, when modified, the concessions granted consisted of temporary interest-only payments, extensions of maturity date, or a reduction in the rate of interest to a below-market rate for a contractual period of time. Other than the TDRs that were placed on non-accrual status, the TDRs were performing in accordance with their modified terms. The following presents by class, information related to loans modified in a TDR: Loans modified as TDRs for the: (dollars in thousands) Three months ended March 31, 2016 Three months ended March 31, 2015 Recorded Increase in Recorded Increase in Number investment allowance Number investment allowance of (as of (as of of (as of (as of contracts period end) period end) contracts period end) period end) Commercial and industrial $ - $ - 1 $ 500 $ 331 Commercial real estate - owner occupied - - 2 1,107 251 Consumer home equity line of credit 1 650 128 - - Total 1 $ 650 $ 128 3 $ 1,607 $ 582 In the above table, the period end balances are inclusive of all partial pay downs and charge-offs since the modification date. The following presents by class, loans modified as a TDR that subsequently defaulted (i.e. 90 days or more past due following a modification) during the periods indicated: Loans modified as a TDR within the previous twelve months that subsequently defaulted during the: (dollars in thousands) Three months ended March 31, 2016 Number of Recorded contracts investment Commercial real estate - owner occupied 2 $ 156 In the above table, the period end balances are inclusive of all partial pay downs and charge-offs since the modification date. Loans modified in a TDR are closely monitored for delinquency as an early indicator of possible future default. If loans modified in a TDR subsequently default, the Company evaluates the loan fo r possible further impairment . Two CRE loans that were classified as TDRs in fourth quarter of 2015 subsequently defaulted during the first quarter of 2016. Both loans defaulted due to inability to meet contractual payments and the Company continued workout efforts to collect from the owners. There were no loans modified as a TDR within the previous twelve months that subsequently defaulted during the three months ended March 31, 2015. The allowance for loan losses (allowance) may be increased, adjustments may be made in the allocation of the allowance or partial charge-offs may be taken to further write-down the carrying value of the loan. An allowance for impaired loans that have been modified in a TDR is measured based on the present value of expected future cash flows discounted at the loan’s effective interest rate or the loan’s observable market price. If the loan is collateral dependent, the estimated fair value of the collateral is used to establish the allowance. As of March 31, 2016 and 2015 , the allowance for impaired loans that have been modified in a TDR was $0.8 million and $0.6 million , respectively. Past due loans Loans are considered past due when the contractual principal and/or interest is not received by the due date. An aging analysis of past due loans, segregated by class of loans, as of the period indicated is as follows (dollars in thousands): Recorded Past due investment past 30 - 59 Days 60 - 89 Days 90 days Total Total due ≥ 90 days March 31, 2016 past due past due or more (1) past due Current loans (3) and accruing Commercial and industrial $ 63 $ 6 $ 59 $ 128 $ 103,575 $ 103,703 $ 27 Commercial real estate: Non-owner occupied 643 210 6,178 7,031 88,272 95,303 - Owner occupied 237 - 594 831 97,692 98,523 35 Construction - - 218 218 4,686 4,904 - Consumer: Home equity installment 370 22 92 484 29,533 30,017 - Home equity line of credit 177 - 438 615 47,716 48,331 - Auto loans and leases 232 42 580 854 28,307 29,161 (2) 557 Other 29 5 6 40 5,730 5,770 - Residential: Real estate 59 295 760 1,114 129,156 130,270 - Construction - - - - 10,109 10,109 - Total $ 1,810 $ 580 $ 8,925 $ 11,315 $ 544,776 $ 556,091 $ 619 (1) Includes $ 8.3 million of non-accrual loans. (2) Net of unearned lease revenue of $0. 4 million. (3) Includes net deferred loan costs of $1.5 million. Recorded Past due investment past 30 - 59 Days 60 - 89 Days 90 days Total Total due ≥ 90 days December 31, 2015 past due past due or more (1) past due Current loans (3) and accruing Commercial and industrial $ 38 $ 32 $ 42 $ 112 $ 102,541 $ 102,653 $ 12 Commercial real estate: Non-owner occupied 549 1,282 6,476 8,307 87,438 95,745 283 Owner occupied - 85 988 1,073 100,579 101,652 - Construction - - 226 226 4,255 4,481 - Consumer: Home equity installment 189 92 167 448 30,487 30,935 - Home equity line of credit 109 650 512 1,271 46,789 48,060 - Auto loans and leases 394 44 76 514 28,909 29,423 (2) 31 Other 66 - 36 102 6,106 6,208 30 Residential: Real estate 46 131 836 1,013 125,979 126,992 - Construction - - - - 10,060 10,060 - Total $ 1,391 $ 2,316 $ 9,359 $ 13,066 $ 543,143 $ 556,209 $ 356 (1) Includes $ 9.0 million of non-accrual loans. (2) Net of unearned lease revenue of $0. 3 million. (3) Includes net deferred loan costs of $1.5 million. Impaired loans A loan is considered impaired when, based on current information and events; it is probable that the Company will be unable to collect the scheduled payments in accordance with the contractual terms of the loan. Factors considered in determining impairment include payment status, collateral value and the probability of collecting payments when due. The significance of payment delays and/or shortfalls is determined on a case-by-case basis. All circumstances surrounding the loan are taken into account. Such factors include the length of the delinquency, the underlying reasons and the borrower’s prior payment record. Impairment is measured on these loans on a loan-by-loan basis. Impaired loans include non-accrual loans, TDRs and other loans deemed to be impaired based on the aforementioned factors. At March 31, 2016, impaired loans consisted of accruing TDRs of $2.8 million, $8.3 million in non-accrual loans and $2.7 million in accruing loans. At December 31, 2015, impaired loans consisted of accruing TDRs totaling $2.4 million, $9.0 million of non-accrual loans and a $1.2 million accruing loan. As of December 31, 2015, the non-accrual loans did not include any TDRs compared with two TDRs with a $0.2 million balance as of March 31, 2016. Payments received from non-accruing impaired loans are first applied against the outstanding principal balance, then to the recovery of any charged-off amounts. Any excess is treated as a recovery of interest income. Payments received from accruing impaired loans are applied to principal and interest, as contractually agreed upon. Impaired loans, segregated by class, as of the perio d indicated are detailed below: Recorded Recorded Unpaid investment investment Total principal with with no recorded Related (dollars in thousands) balance allowance allowance investment allowance March 31, 2016 Commercial and industrial $ 868 $ 824 $ 44 $ 868 $ 614 Commercial real estate: Non-owner occupied 7,959 7,470 566 8,036 1,467 Owner occupied 2,878 1,832 885 2,717 560 Construction 416 - 218 218 - Consumer: Home equity installment 142 60 32 92 5 Home equity line of credit 1,129 755 333 1,088 193 Auto loans and leases 23 22 1 23 5 Other 6 6 - 6 2 Residential: Real estate 894 475 285 760 38 Construction - - - - - Total $ 14,315 $ 11,444 $ 2,364 $ 13,808 $ 2,884 Recorded Recorded Unpaid investment investment Total principal with with no recorded Related (dollars in thousands) balance allowance allowance investment allowance December 31, 2015 Commercial and industrial $ 555 $ 500 $ 55 $ 555 $ 331 Commercial real estate: Non-owner occupied 7,960 7,209 630 7,839 1,237 Owner occupied 2,588 922 1,505 2,427 337 Construction 422 - 226 226 - Consumer: Home equity installment 230 - 167 167 - Home equity line of credit 607 28 484 512 1 Auto 47 43 2 45 7 Other 6 6 - 6 1 Residential: Real estate 891 433 403 836 95 Construction - - - - - Total $ 13,306 $ 9,141 $ 3,472 $ 12,613 $ 2,009 March 31, 2016 March 31, 2015 Cash basis Cash basis Average Interest interest Average Interest interest recorded income income recorded income income (dollars in thousands) investment recognized recognized investment recognized recognized Commercial and industrial $ 675 $ 6 $ - $ 206 $ 6 $ - Commercial real estate: Non-owner occupied 3,859 24 - 1,596 14 - Owner occupied 2,825 38 - 2,174 13 - Construction 234 - - 265 - - Consumer: Home equity installment 195 2 - 326 - - Home equity line of credit 606 11 - 428 1 - Auto 29 - - 1 - - Other 9 - - 22 - - Residential: Real estate 671 2 - 605 - - Construction - - - - - - Total $ 9,103 $ 83 $ - $ 5,623 $ 34 $ - Credit Quality Indicators Commercial and industrial and commercial real estate The Company utilizes a loan grading system and assigns a credit risk grade to its loans in the C&I and CRE portfolios. The grading system provides a means to measure portfolio quality and aids in the monitoring of the credit quality of the overall loan portfolio. The credit risk grades are arrived at using a risk rating matrix to assign a grade to each of the loans in the C&I and CRE portfolios. The following is a description of each risk rating category the Company uses to classify each of its C&I and CRE loans: Pass Loans in this category have an acceptable level of risk and are graded in a range of one to five. Secured loans generally have good collateral coverage. Current financial statements reflect acceptable balance sheet ratios, sales and earnings trends. Management is considered to be competent, and a reasonable succession plan is evident. Payment experience on the loans has been good with minor or no delinquency experience. Loans with a grade of one are of the highest quality in the range. Those graded five are of marginally acceptable quality. Special Mention Loans in this category are graded a six and may be protected but are potentially weak. They constitute a credit risk to the Company, but have not yet reached the point of adverse classification. Some of the following conditions may exist: little or no collateral coverage; lack of current financial information; delinquency problems; highly leveraged; available financial information reflects poor balance sheet ratios and profit and loss statements reflect uncertain trends; and document exceptions. Cash flow may not be sufficient to support total debt service requirements. Substandard Loans in this category are graded a seven and have a well-defined weakness which may jeopardize the ultimate collectability of the debt. The collateral pledged may be lacking in quality or quantity. Financial statements may indicate insufficient cash flow to service the debt; and/or do not reflect a sound net worth. The payment history indicates chronic delinquency problems. Management is considered to be weak. There is a distinct possibility that the Company may sustain a loss. All loans on non-accrual are rated substandard. Other loans that are included in the substandard category can be accruing, as well as loans that are current or past due. Loans 90 days or more past due, unless otherwise fully supported, are classified substandard. Also, borrowers that are bankrupt or have loans categorized as TDRs can be graded substandard. Doubtful Loans in this category are graded an eight and have a better than 50% possibility of the Company sustaining a loss, but the loss cannot be determined because of specific reasonable factors which may strengthen credit in the near-term. Many of the weaknesses present in a substandard loan exist. Liquidation of collateral, if any, is likely. Any loan graded lower than an eight is considered to be uncollectible and charged-off . Consumer and residential The consumer and residential loan segments are regarded as homogeneous loan pools and as such are not risk rated. For these portfolios, the Company utilizes payment activity, history and recency of payment in assessing performance. Non-performing loans are considered to be loans past due 90 days or more and accruing and non-accrual loans. All loans not classified as non-performing are considered performing. The following table presents loans including $1.5 million of deferred costs, segregated by class, categorized into the appropriate credit quality indicator category as of March 31, 2016 and December 31, 2015 , respectively: Commercial credit exposure Credit risk profile by creditworthiness category Commercial real estate - Commercial real estate - Commercial real estate - Commercial and industrial non-owner occupied owner occupied construction (dollars in thousands) 3/31/2016 12/31/2015 3/31/2016 12/31/2015 3/31/2016 12/31/2015 3/31/2016 12/31/2015 Pass $ 96,513 $ 101,342 $ 82,087 $ 82,152 $ 94,694 $ 96,401 $ 4,686 $ 4,255 Special mention 6,007 189 1,382 1,480 649 657 - - Substandard 1,183 1,122 11,834 12,113 3,180 4,594 218 226 Doubtful - - - - - - - - Total $ 103,703 $ 102,653 $ 95,303 $ 95,745 $ 98,523 $ 101,652 $ 4,904 $ 4,481 Consumer credit exposure Credit risk profile based on payment activity Home equity installment Home equity line of credit Auto loans and leases Other (dollars in thousands) 3/31/2016 12/31/2015 3/31/2016 12/31/2015 3/31/2016 12/31/2015 3/31/2016 12/31/2015 Performing $ 29,925 $ 30,768 $ 47,893 $ 47,548 $ 28,581 $ 29,347 $ 5,764 $ 6,172 Non-performing 92 167 438 512 580 76 6 36 Total $ 30,017 $ 30,935 $ 48,331 $ 48,060 $ 29,161 (1) $ 29,423 (2) $ 5,770 $ 6,208 (1) Net of unearned lease revenue of $0.4 million. (2) Net of unearned revenue of $0.3 million. Mortgage lending credit exposure Credit risk profile based on payment activity Residential real estate Residential construction (dollars in thousands) 3/31/2016 12/31/2015 3/31/2016 12/31/2015 Performing $ 129,510 $ 126,156 $ 10,109 $ 10,060 Non-performing 760 836 - - Total $ 130,270 $ 126,992 $ 10,109 $ 10,060 Allowance for loan losses Management continually evaluates the credit quality of the Company’s loan portfolio and performs a formal review of the adequacy of the allowance on a quarterly basis. The allowance reflects management’s best estimate of the amount of credit losses in the loan portfolio. Management’s judgment is based on the evaluation of individual loans, past experience, the assessment of current economic conditions and other relevant factors including the amounts and timing of cash flows expected to be received on impaired loans. Those estimates may be susceptible to significant change. Loan losses are charged directly against the allowance when loans are deemed to be uncollectible. Recoveries from previously charged-off loans are added to the allowance when received. Management applies two primary components during the loan review process to determine proper allowance levels. The two components are a specific loan loss allocation for loans that are deemed impaired and a general loan loss allocation for those loans not specifically allocated. The methodology to analyze the adequacy of the allowance for loan losses is as follows: § identification of specific impaired loans by loan category; § identification of specific loans that are not impaired, but have an identified potential for loss; § calculation of specific allowances where required for the impaired loans based on collateral and other objective and quantifiable evidence; § determination of loans with similar credit characteristics within each class of the loan portfolio segment and eliminating the impaired loans; § application of historical loss percentages (t railing twelve-quarter average) to pools to determine the allowance allocation; § application of qualitative factor adjustment percentages to historical losses for trends or changes in the loan portfolio. § Qualitative factor adjustments include: o levels of and trends in delinquencies and non-accrual loans; o levels of and trends in charge-offs and recoveries; o trends in volume and terms of loans; o changes in risk selection and underwriting standards; o changes in lending policies, procedures and practices; o experience, ability and depth of lending management; o national and local economic trends and conditions; and o changes in credit concentrations. Allocation of the allowance for different categories of loans is based on the methodology as explained above. A key element of the methodology to determine the allowance is the Company’s credit risk evaluation process, which includes credit risk grading of individual C&I and CRE loans. C&I and CRE loans are assigned credit risk grades based on the Company’s assessment of conditions that affect the borrower’s ability to meet its contractual obligations under the loan agreement. That process includes reviewing borrowers’ current financial information, historical payment experience, credit documentation, public information and other information specific to each individual borrower. Upon review, the commercial loan credit risk grade is revised or reaffirmed as the case may be. The credit risk grades may be changed at any time management feels an upgrade or downgrade may be warranted. The credit risk grades for the C&I and CRE loan portfolios are taken into account in the reserve methodology and loss factors are applied based upon the credit risk grades. The loss factors applied are based upon the Company’s historical experience as well as what we believe to be best practices and common industry standards. Historical experience reveals there is a direct correlation between the credit risk grades and loan charge-offs. The changes in allocations in the C&I and CRE loan portfolio from period to period are based upon the credit risk grading system and from periodic reviews of the loan portfolio. An unallocated component is maintained to cover uncertainties that could affect management’s estimate of probable losses. The unallocated component of the allowance reflects the margin of imprecision inherent in the underlying assumptions used in the methodologies. Each quarter, management performs an assessment of the allowance. The Company’s Special Assets Committee meets monthly and the applicable lenders discuss each relationship under review and reach a consensus on the appropriate estimated loss amount, if applicable, based on current accounting guidance. The Special Assets Committee’s focus is on ensuring the pertinent facts are considered regarding not only loans considered for specific reserves, but also the collectability of loans that may be past due in payment. The assessment process also includes the review of all loans on a non-accruing basis as well as a review of certain loans to which the lenders or the Company’s Credit Administration function have assigned a criticized or classified risk rating. The Company’s policy is to charge-off unsecured consumer loans when they become 90 days or more past due as to principal and interest. In the other portfolio segments, amounts are charged-off at the point in time when the Company deems the balance, or a portion thereof, to be uncollectible. Information related to the change in the allowance and the Company’s recorded investment in loans by portfolio segment as of the period indicated is as follows: As of and for the three months ended March 31, 2016 Commercial & Commercial Residential (dollars in thousands) industrial real estate Consumer real estate Unallocated Total Allowance for Loan Losses: Beginning balance $ 1,336 $ 5,014 $ 1,533 $ 1,407 $ 237 $ 9,527 Charge-offs (14) (85) (175) (60) - (334) Recoveries 9 4 28 - - 41 Provision 309 (350) 292 32 (133) 150 Ending balance $ 1,640 $ 4,583 $ 1,678 $ 1,379 $ 104 $ 9,384 Ending balance: individually evaluated for impairment $ 614 $ 2,027 $ 205 $ 38 $ - $ 2,884 Ending balance: collectively evaluated for impairment $ 1,026 $ 2,556 $ 1,473 $ 1,341 $ 104 $ 6,500 Loans Receivables: Ending balance (2) $ 103,703 $ 198,730 $ 113,279 (1) $ 140,379 $ - $ 556,091 Ending balance: individually evaluated for impairment $ 868 $ 10,971 $ 1,209 $ 760 $ - $ 13,808 Ending balance: collectively evaluated for impairment $ 102,835 $ 187,759 $ 112,070 $ 139,619 $ - $ 542,283 ( 1) Net of unearned lease revenue of $0. 4 million. (2) Includes $1.5 million of net deferred loan costs. As of and for the three months ended March 31, 2015 Commercial & Commercial Residential (dollars in thousands) industrial real estate Consumer real estate Unallocated Total Allowance for Loan Losses: Beginning balance $ 1,052 $ 4,672 $ 1,519 $ 1,316 $ 614 $ 9,173 Charge-offs (24) (67) (92) - - (183) Recoveries 9 7 24 28 - 68 Provision 177 (97) 62 (1) 9 150 Ending balance $ 1,214 $ 4,515 $ 1,513 $ 1,343 $ 623 $ 9,208 As of and for the year ended December 31, 2015 Commercial & Commercial Residential (dollars in thousands) industrial real estate Consumer real estate Unallocated Total Allowance for Loan Losses: Beginning balance $ 1,052 $ 4,672 $ 1,519 $ 1,316 $ 614 $ 9,173 Charge-offs (25) (432) (437) (15) - (909) Recoveries 47 18 95 28 - 188 Provision 262 756 356 78 (377) 1,075 Ending balance $ 1,336 $ 5,014 $ 1,533 $ 1,407 $ 237 $ 9,527 Ending balance: individually evaluated for impairment $ 331 $ 1,574 $ 9 $ 95 $ - $ 2,009 Ending balance: collectively evaluated for impairment $ 1,005 $ 3,440 $ 1,524 $ 1,312 $ 237 $ 7,518 Loans Receivables: Ending balance (2) $ 102,653 $ 201,878 $ 114,626 (1) $ 137,052 $ - $ 556,209 Ending balance: individually evaluated for impairment $ 555 $ 10,492 $ 730 $ 836 $ - $ 12,613 Ending balance: collectively evaluated for impairment $ 102,098 $ 191,386 $ 113,896 $ 136,216 $ - $ 543,596 (1 ) Net of unearned lease revenue of $0.3 million . (2) Includes $1.5 million of net deferred loan cos ts. |