Loans | Loans Loan portfolio segments are defined as the level at which an entity develops and documents a systematic methodology to determine its allowance. The Corporation has two loan portfolio segments (commercial loans and consumer loans) that it uses in determining the allowance. Both quantitative and qualitative factors are used by management at the loan portfolio segment level in determining the adequacy of the allowance for the Corporation. Classes of loans are a disaggregation of an entity's loan portfolio segments. Classes of loans are defined as a group of loans which share similar initial measurement attributes, risk characteristics and methods for monitoring and assessing credit risk. The Corporation has six classes of loans, which are set forth below. Commercial — Loans and lines of credit to varying types of businesses, including municipalities, school districts and nonprofit organizations, for the purpose of supporting working capital, operational needs and term financing of equipment. Repayment of such loans is generally provided through operating cash flows of the business. Commercial loans are predominately secured by equipment, inventory, accounts receivable, personal guarantees of the owner and other sources of repayment, although the Corporation may also secure commercial loans with real estate. Commercial real estate — Loans secured by real estate occupied by the borrower for ongoing operations, non-owner occupied real estate leased to one or more tenants and vacant land that has been acquired for investment or future land development. Real estate construction and land development — Real estate construction loans represent secured loans for the construction of business properties. Real estate construction loans often convert to a commercial real estate loan at the completion of the construction period. Land development loans represent secured development loans made to borrowers for the purpose of infrastructure improvements to vacant land to create finished marketable residential and commercial lots/land. Most land development loans are originated with the intention that the loans will be paid through the sale of developed lots/land by the developers within twelve months of the completion date. Land development loans at December 31, 2016 and 2015 were primarily comprised of loans to develop residential properties. Residential mortgage — Loans secured by one - to four -family residential properties, generally with fixed interest rates for periods of fifteen years or less. The loan-to-value ratio at the time of origination is generally 80% or less. Residential mortgage loans with a loan-to-value ratio of more than 80% generally require private mortgage insurance. Consumer installment — Loans to consumers primarily for the purpose of acquiring automobiles, recreational vehicles and personal watercraft and comprised primarily of indirect loans purchased from dealers. These loans consist of relatively small amounts that are spread across many individual borrowers. Home equity — Loans and lines of credit whereby consumers utilize equity in their personal residence, generally through a second mortgage, as collateral to secure the loan. Commercial, commercial real estate, real estate construction and land development loans are referred to as the Corporation's commercial loan portfolio, while residential mortgage, consumer installment and home equity loans are referred to as the Corporation's consumer loan portfolio. A summary of the Corporation's loans follows: (Dollars in thousands) Originated Acquired (1) Total loans December 31, 2016 Commercial loan portfolio: Commercial $ 1,901,526 $ 1,315,774 $ 3,217,300 Commercial real estate 1,921,799 2,051,341 3,973,140 Real estate construction and land development 281,724 122,048 403,772 Subtotal 4,105,049 3,489,163 7,594,212 Consumer loan portfolio: Residential mortgage 1,475,342 1,611,132 3,086,474 Consumer installment 1,282,588 151,296 1,433,884 Home equity 595,422 280,787 876,209 Subtotal 3,353,352 2,043,215 5,396,567 Total loans $ 7,458,401 $ 5,532,378 $ 12,990,779 (2) December 31, 2015 Commercial loan portfolio: Commercial $ 1,521,515 $ 384,364 $ 1,905,879 Commercial real estate 1,424,059 688,103 2,112,162 Real estate construction and land development 185,147 46,929 232,076 Subtotal 3,130,721 1,119,396 4,250,117 Consumer loan portfolio: Residential mortgage 1,216,975 212,661 1,429,636 Consumer installment 869,426 8,031 877,457 Home equity 590,812 123,125 713,937 Subtotal 2,677,213 343,817 3,021,030 Total loans $ 5,807,934 $ 1,463,213 $ 7,271,147 (2) (1) Acquired loans are accounted for under ASC 310-30. (2) Reported net of deferred costs totaling $14.8 million and $10.7 million at December 31, 2016 and 2015 , respectively. Chemical Bank has extended loans to its directors, executive officers and their affiliates. These loans were made in the ordinary course of business upon normal terms, including collateralization and interest rates prevailing at the time, and did not involve more than the normal risk of repayment by the borrower. The aggregate loans outstanding to the directors, executive officers and their affiliates totaled $23.9 million at December 31, 2016 and $21.7 million at December 31, 2015 . During 2016 and 2015 , there were $33.8 million and $33.3 million , respectively, of new loans and other additions, while repayments and other reductions totaled $31.6 million and $42.8 million , respectively. Loans held-for-sale, comprised of fixed-rate residential mortgage loans, were $81.8 million at December 31, 2016 and $10.3 million at December 31, 2015 . The Corporation sold loans totaling $707.8 million in 2016 and $222.6 million in 2015 . Credit Quality Monitoring The Corporation maintains loan policies and credit underwriting standards as part of the process of managing credit risk. These standards include making loans generally only within the Corporation's market areas. The Corporation's lending markets generally consist of communities throughout Michigan and additional communities located within northwest Ohio and northern Indiana. The Corporation, through Chemical Bank, has a commercial loan portfolio approval process involving underwriting and individual and group loan approval authorities to consider credit quality and loss exposure at loan origination. The loans in the Corporation's commercial loan portfolio are risk rated at origination based on the grading system set forth below. The approval authority of relationship managers is established based on experience levels, with credit decisions greater than $2.0 million requiring group loan authority approval, except for six executive and senior officers who have varying loan limits exceeding $2.0 million and up to $3.5 million . With respect to the group loan authorities, Chemical Bank has various regional loan committees hat meet weekly to consider loan ranging in amounts from $2.0 million to $5.0 million , and a senior loan committee, consisting of certain executive and senior officers, that meets weekly to consider loans ranging in amounts from $5.0 million to $10.0 million , depending on risk rating and credit action required. A directors' loan committee of Chemical Bank, consisting of eight independent members of the board of directors of Chemical Bank, the chief executive officer of Chemical Bank and the chief credit officer of Chemical Bank, meets bi-weekly to consider loans in amounts over $10.0 million , and certain loans under $10.0 million depending on a loan's risk rating and credit action required. Loans over $25.0 million require the approval of the board of directors of Chemical Bank. The majority of the Corporation's consumer loan portfolio is comprised of secured loans that are relatively small. The Corporation's consumer loan portfolio has a centralized approval process which utilizes standardized underwriting criteria. The ongoing measurement of credit quality of the consumer loan portfolio is largely done on an exception basis. If payments are made on schedule, as agreed, then no further monitoring is performed. However, if delinquency occurs, the delinquent loans are turned over to the Corporation's collection department for resolution, resulting in repossession or foreclosure if payments are not brought current. Credit quality for the entire consumer loan portfolio is measured by the periodic delinquency rate, nonaccrual amounts and actual losses incurred. Loans in the commercial loan portfolio tend to be larger and more complex than those in the consumer loan portfolio, and therefore, are subject to more intensive monitoring. All loans in the commercial loan portfolio have an assigned relationship manager, and most borrowers provide periodic financial and operating information that allows the relationship managers to stay abreast of credit quality during the life of the loans. The risk ratings of loans in the commercial loan portfolio are reassessed at least annually, with loans below an acceptable risk rating reassessed more frequently and reviewed by various loan committees within the Corporation at least quarterly. The Corporation maintains a centralized independent loan review function that monitors the approval process and ongoing asset quality of the loan portfolio, including the accuracy of loan grades. The Corporation also maintains an independent appraisal review function that participates in the review of all appraisals obtained by the Corporation for loans in the commercial loan portfolio. Credit Quality Indicators Commercial Loan Portfolio Risk categories for the Corporation's commercial loan portfolio establish the credit quality of a borrower by measuring liquidity, debt capacity, coverage and payment behavior as shown in the borrower's financial statements. The risk categories also measure the quality of the borrower's management and the repayment support offered by any guarantors. Risk categories for the Corporation's commercial loan portfolio are described as follows: Pass: Includes all loans without weaknesses or potential weaknesses identified in the categories of special mention, substandard or doubtful. Special Mention: Loans with potential credit weakness or credit deficiency, which, if not corrected, pose an unwarranted financial risk that could weaken the loan by adversely impacting the future repayment ability of the borrower. Substandard: Loans with a well-defined weakness, or weaknesses, such as loans to borrowers who may be experiencing losses from operations or inadequate liquidity of a degree and duration that jeopardizes the orderly repayment of the loan. Substandard loans also are distinguished by the distinct possibility of loss in the future if these weaknesses are not corrected. Doubtful: Loans with all the characteristics of a loan classified as Substandard, with the added characteristic that credit weaknesses make collection in full highly questionable and improbable. The following schedule presents the recorded investment of loans in the commercial loan portfolio by credit risk categories at December 31, 2016 and 2015 : (Dollars in thousands) Pass Special Mention Substandard Doubtful Total December 31, 2016 Originated Portfolio: Commercial $ 1,803,750 $ 44,809 $ 51,898 $ 1,069 $ 1,901,526 Commercial real estate 1,849,315 36,981 35,502 1 1,921,799 Real estate construction and land development 280,968 157 599 — 281,724 Subtotal 3,934,033 81,947 87,999 1,070 4,105,049 Acquired Portfolio: Commercial 1,218,848 46,643 50,283 — 1,315,774 Commercial real estate 1,897,011 61,441 92,636 253 2,051,341 Real estate construction and land development 117,505 1,982 2,561 — 122,048 Subtotal 3,233,364 110,066 145,480 253 3,489,163 Total $ 7,167,397 $ 192,013 $ 233,479 $ 1,323 $ 7,594,212 December 31, 2015 Originated Portfolio: Commercial $ 1,418,301 $ 34,727 $ 66,392 $ 2,095 $ 1,521,515 Commercial real estate 1,341,202 31,036 51,821 — 1,424,059 Real estate construction and land development 183,323 180 1,644 — 185,147 Subtotal 2,942,826 65,943 119,857 2,095 3,130,721 Acquired Portfolio: Commercial 340,782 28,321 15,261 — 384,364 Commercial real estate 629,430 23,926 34,747 — 688,103 Real estate construction and land development 41,683 2,556 2,690 — 46,929 Subtotal 1,011,895 54,803 52,698 — 1,119,396 Total $ 3,954,721 $ 120,746 $ 172,555 $ 2,095 $ 4,250,117 Consumer Loan Portfolio The Corporation evaluates the credit quality of loans in the consumer loan portfolio based on the performing or nonperforming status of the loan. Loans in the consumer loan portfolio that are performing in accordance with original contractual terms and are less than 90 days past due and accruing interest are considered to be in a performing status, while those that are in nonaccrual status, contractually past due 90 days or more as to interest or principal payments are considered to be in a nonperforming status. Loans accounted for under ASC 310-30, "acquired loans", that are not performing in accordance with contractual terms are not reported as nonperforming because these loans are recorded in pools at their net realizable value based on the principal and interest the Corporation expects to collect on these loans. The following schedule presents the recorded investment of loans in the consumer loan portfolio based on loans in a performing status and loans in a nonperforming status at December 31, 2016 and 2015 : (Dollars in thousands) Residential mortgage Consumer installment Home equity Total consumer December 31, 2016 Originated Portfolio: Performing $ 1,468,373 $ 1,281,709 $ 592,071 $ 3,342,153 Nonperforming 6,969 879 3,351 11,199 Subtotal 1,475,342 1,282,588 595,422 3,353,352 Acquired Loans 1,611,132 151,296 280,787 2,043,215 Total $ 3,086,474 $ 1,433,884 $ 876,209 $ 5,396,567 December 31, 2015 Originated Portfolio: Performing $ 1,211,418 $ 868,975 $ 588,833 $ 2,669,226 Nonperforming 5,557 451 1,979 7,987 Subtotal 1,216,975 869,426 590,812 2,677,213 Acquired Loans 212,661 8,031 123,125 343,817 Total $ 1,429,636 $ 877,457 $ 713,937 $ 3,021,030 Nonperforming Assets and Past Due Loans Nonperforming assets consist of loans for which the accrual of interest has been discontinued, other real estate owned acquired through acquisitions, other real estate owned obtained through foreclosure and other repossessed assets. Loans are considered past due or delinquent when the contractual principal or interest due in accordance with the terms of the loan agreement or any portion thereof remains unpaid after the due date of the scheduled payments. Loans outside of those accounted for under ASC 310-30 are classified as nonaccrual when, in the opinion of management, collection of principal or interest is doubtful. The accrual of interest is discontinued when a loan is placed in nonaccrual status and any payments received reduce the carrying value of the loan. A loan may be placed back on accrual status if all contractual payments have been received and collection of future principal and interest payments are no longer doubtful. Acquired loans that are not performing in accordance with contractual terms are not reported as nonperforming because these loans are recorded in pools at their net realizable value based on the principal and interest the Corporation expects to collect on these loans. A summary of nonperforming assets follows: December 31, (Dollars in thousands) 2016 2015 Nonperforming assets Nonaccrual loans: Commercial $ 13,178 $ 28,554 Commercial real estate 19,877 25,163 Real estate construction and land development 80 521 Residential mortgage 6,969 5,557 Consumer installment 879 451 Home equity 3,351 1,979 Total nonaccrual loans 44,334 62,225 Other real estate owned and repossessed assets 17,187 9,935 Total nonperforming assets $ 61,521 $ 72,160 Accruing loans contractually past due 90 days or more as to interest or principal payments, excluding acquired loans accounted for under ASC 310-30 Commercial 11 364 Commercial real estate 277 254 Residential mortgage — 402 Home equity 995 1,267 Total accruing loans contractually past due 90 days or more as to interest or principal payments, excluding acquired loans accounted for under ASC 310-30 $ 1,283 $ 2,287 The Corporation's nonaccrual loans at December 31, 2016 and 2015 included $30.5 million and $35.9 million , respectively, of nonaccrual TDRs. There was no interest income recognized on nonaccrual loans during 2016 , 2015 and 2014 while the loans were in nonaccrual status. During 2016 , 2015 and 2014 , the Corporation recognized $0.4 million , $0.9 million and $0.5 million , respectively, of interest income on these loans while they were in an accruing status. Additional interest income that would have been recorded on nonaccrual loans had they been current in accordance with their original terms was $2.9 million in 2016 , $3.2 million in 2015 and $3.3 million in 2014 . During 2016 , 2015 and 2014 , the Corporation recognized interest income of $3.9 million , $3.9 million and $3.6 million , respectively, on performing TDRs. The Corporation had $7.3 million of residential mortgage loans that were in the process of foreclosure at December 31, 2016 , compared to $2.9 million at December 31, 2015 . Loan delinquency, excluding acquired loans accounted for under ASC 310-30, was as follows: (Dollars in thousands) 30-59 days past due 60-89 days past due 90 days or more past due Total past due Current Total loans 90 days or more past due and still accruing December 31, 2016 Originated Portfolio: Commercial $ 10,421 $ 4,842 $ 3,641 $ 18,904 $ 1,882,622 $ 1,901,526 $ 11 Commercial real estate 6,551 1,589 5,165 13,305 1,908,494 1,921,799 277 Real estate construction and land development 2,721 499 — 3,220 278,504 281,724 — Residential mortgage 3,147 62 1,752 4,961 1,470,381 1,475,342 — Consumer installment 3,991 675 238 4,904 1,277,684 1,282,588 — Home equity 3,097 893 2,349 6,339 589,083 595,422 995 Total $ 29,928 $ 8,560 $ 13,145 $ 51,633 $ 7,406,768 $ 7,458,401 $ 1,283 December 31, 2015 Originated Portfolio: Commercial $ 9,393 $ 5,243 $ 364 $ 15,000 $ 1,506,515 $ 1,521,515 $ 364 Commercial real estate 6,941 2,262 254 9,457 1,414,602 1,424,059 254 Real estate construction and land development 596 — — 596 184,551 185,147 — Residential mortgage 7,475 1,170 402 9,047 1,207,928 1,216,975 402 Consumer installment 3,347 741 — 4,088 865,338 869,426 — Home equity 2,075 1,113 1,267 4,455 586,357 590,812 1,267 Total $ 29,827 $ 10,529 $ 2,287 $ 42,643 $ 5,765,291 $ 5,807,934 $ 2,287 Impaired Loans A loan is impaired when, based on current information and events, it is probable that the Corporation will be unable to collect all amounts due according to the contractual terms of the loan agreement. Impaired loans include nonperforming loans and all TDRs. Impaired loans are accounted for at the lower of the present value of expected cash flows or the estimated fair value of the collateral. When the present value of expected cash flows or the fair value of the collateral of an impaired loan not accounted for under ASC 310-30 is less than the amount of unpaid principal outstanding on the loan, the recorded principal balance of the loan is reduced to its carrying value through either a specific allowance for loan loss or a partial charge-off of the loan balance. The following schedules present impaired loans by classes of loans at December 31, 2016 and December 31, 2015 : (Dollars in thousands) Recorded investment Unpaid principal balance Related valuation allowance December 31, 2016 Impaired loans with a valuation allowance: Commercial $ 28,925 $ 33,209 $ 3,128 Commercial real estate 21,318 27,558 2,102 Real estate construction and land development 177 177 4 Residential mortgage 20,864 20,864 3,528 Consumer installment 879 879 240 Home equity 2,577 2,577 390 Subtotal 71,284 81,808 8,762 Impaired loans with no related valuation allowance: Commercial 7,435 11,153 — Commercial real estate 20,588 23,535 — Real estate construction and land development 80 80 — Residential mortgage 3,252 3,252 — Consumer installment — — — Home equity 774 774 — Subtotal 32,129 38,794 — Total impaired loans: Commercial 36,360 44,362 3,128 Commercial real estate 41,906 51,093 2,102 Real estate construction and land development 257 257 4 Residential mortgage 24,116 24,116 3,528 Consumer installment 879 879 — Home equity 3,351 3,351 — Total $ 106,869 $ 124,058 $ 8,762 (Dollars in thousands) Recorded investment Unpaid principal balance Related valuation allowance December 31, 2015 Impaired loans with a valuation allowance: Commercial $ 18,898 $ 19,426 $ 5,700 Commercial real estate 4,448 4,688 497 Residential mortgage 21,037 21,037 192 Subtotal 44,383 45,151 6,389 Impaired loans with no related valuation allowance: Commercial 27,304 32,395 — Commercial real estate 48,747 59,949 — Real estate construction and land development 982 1,062 — Residential mortgage 5,557 5,557 — Consumer installment 451 451 — Home equity 1,979 1,979 — Subtotal 85,020 101,393 — Total impaired loans: Commercial 46,202 51,821 5,700 Commercial real estate 53,195 64,637 497 Real estate construction and land development 982 1,062 — Residential mortgage 26,594 26,594 192 Consumer installment 451 451 — Home equity 1,979 1,979 — Total $ 129,403 $ 146,544 $ 6,389 The following schedule presents additional information regarding impaired loans by classes of loans segregated by those requiring a valuation allowance and those not requiring a valuation allowance at December 31, 2016 , 2015 and 2014 and the respective interest income amounts recognized: For the years ended December 31, 2016 2015 2014 (Dollars in thousands) Average annual recorded investment Interest income recognized while on impaired status Average annual recorded investment Interest income recognized while on impaired status Average annual recorded investment Interest income recognized while on impaired status Impaired loans with a valuation allowance: Commercial $ 7,829 $ — $ 9,511 $ — $ 2,117 $ — Commercial real estate 5,658 — 2,918 — 3,699 — Real estate construction and land development 19 — — — — — Residential mortgage 23,958 1,285 20,661 1,312 19,740 1,252 Consumer installment 359 — — — — — Home equity 1,759 — — — — — Subtotal 37,464 1,285 33,090 1,312 25,556 1,252 Impaired loans with no related valuation allowance: Commercial 29,559 1,343 27,778 1,005 32,895 961 Commercial real estate 41,646 1,236 50,079 1,547 46,344 1,342 Real estate construction and land development 585 22 889 25 1,831 3 Residential mortgage 1,519 — 6,027 — 6,783 — Consumer installment — — 448 — 592 — Home equity 555 — 1,872 — 2,118 — Subtotal 73,864 2,601 87,093 2,577 90,563 2,306 Total impaired loans: Commercial 37,388 1,343 37,289 1,005 35,012 961 Commercial real estate 47,304 1,236 52,997 1,547 50,043 1,342 Real estate construction and land development 604 22 889 25 1,831 3 Residential mortgage 25,477 1,285 26,688 1,312 26,523 1,252 Consumer installment 359 — 448 — 592 — Home equity 2,314 — 1,872 — 2,118 — Total $ 113,446 $ 3,886 $ 120,183 $ 3,889 $ 116,119 $ 3,558 The difference between an impaired loan's recorded investment and the unpaid principal balance for originated loans represents a partial charge-off resulting from a confirmed loss due to the value of the collateral securing the loan being below the loan balance and management's assessment that full collection of the loan balance is not likely. Impaired loans included $62.5 million and $67.2 million at December 31, 2016 and December 31, 2015 , respectively, of accruing TDRs. Loans Modified Under Troubled Debt Restructurings (TDRs) The following tables present the recorded investment of loans modified into TDRs during the years ended December 31, 2016 , 2015 and 2014 by type of concession granted. In cases where more than one type of concession was granted, the loans were categorized based on the most significant concession. Concession type (Dollars in thousands) Principal Principal A/B Note Restructure (1) Interest Forbearance Total Pre- modification recorded investment Post- modification recorded investment For the year ended December 31, 2016 Commercial loan portfolio: Commercial $ 11,533 $ 1,527 $ 43 $ — $ 1,750 54 $ 14,853 $ 14,853 Commercial real estate 2,993 1,866 — — — 16 4,859 4,859 Subtotal 14,526 3,393 43 — 1,750 70 19,712 19,712 Consumer loan portfolio: Residential mortgage 477 — — — — 4 477 477 Consumer installment 87 — — — — 14 87 87 Home equity 179 — — 364 — 10 543 543 Subtotal 743 — — 364 — 28 1,107 1,107 Total loans $ 15,269 $ 3,393 $ 43 $ 364 $ 1,750 98 $ 20,819 $ 20,819 (1) Loan restructurings whereby the original loan is restructured into two notes: an "A" note, which generally reflects the portion of the modified loans which is expected to be collected: and a "B" note, which is fully charged off. Concession type (Dollars in thousands) Principal Principal A/B Note Restructure (1) Interest Forbearance Total Pre- modification recorded investment Post- modification recorded investment For the year ended December 31, 2015 Commercial loan portfolio: Commercial $ 6,031 $ — $ — $ 117 $ 5,298 53 $ 11,446 $ 11,446 Commercial real estate 5,904 450 — 102 740 21 7,196 7,196 Real estate construction and land development 705 — — — — 3 705 705 Subtotal 12,640 450 — 219 6,038 77 19,347 19,347 Consumer loan portfolio: Residential mortgage 1,246 — — 635 — 20 1,881 1,881 Consumer installment 210 — — — — 19 210 210 Home equity 1,110 — — 46 — 26 1,158 1,156 Subtotal 2,566 — — 681 — 65 3,249 3,247 Total loans $ 15,206 $ 450 $ — $ 900 $ 6,038 142 $ 22,596 $ 22,594 (1) Loan restructurings whereby the original loan is restructured into two notes: an "A" note, which generally reflects the portion of the modified loans which is expected to be collected: and a "B" note, which is fully charged off. Concession type (Dollars in thousands) Principal Principal A/B Note Restructure (1) Interest Forbearance Total Pre- modification recorded investment Post- modification recorded investment For the year ended December 31, 2014 Commercial loan portfolio: Commercial $ 12,657 $ 112 $ 111 $ 901 $ — 53 $ 13,781 $ 13,781 Commercial real estate 10,713 154 223 671 314 46 12,075 12,075 Real estate construction and land development 72 — — — — 1 72 72 Subtotal 23,442 266 334 1,572 314 100 25,928 25,928 Consumer loan portfolio: Residential mortgage 1,832 — — 991 — 36 2,847 2,823 Consumer installment 572 — — — — 52 572 572 Home equity 606 — — 157 — 31 765 763 Subtotal 3,010 — — 1,148 — 119 4,184 4,158 Total loans $ 26,452 $ 266 $ 334 $ 2,720 $ 314 219 $ 30,112 $ 30,086 (1) Loan restructurings whereby the original loan is restructured into two notes: an "A" note, which generally reflects the portion of the modified loans which is expected to be collected: and a "B" note, which is fully charged off. The pre-modification and post-modification recorded investment represents amounts as of the date of loan modification. The difference between the pre-modification and post-modification recorded investment of residential mortgage TDRs represents impairment recognized by the Corporation through the provision for loan losses computed based on a loan's post-modification present value of expected future cash flows discounted at the loan's original effective interest rate. The following schedule presents the Corporation's TDRs at December 31, 2016 and 2015 : (Dollars in thousands) Accruing TDRs Nonaccrual TDRs Total December 31, 2016 Commercial loan portfolio $ 45,388 $ 25,397 $ 70,785 Consumer loan portfolio 17,147 5,134 22,281 Total $ 62,535 $ 30,531 $ 93,066 December 31, 2015 Commercial loan portfolio $ 46,141 $ 32,682 $ 78,823 Consumer loan portfolio 21,037 3,251 24,288 Total $ 67,178 $ 35,933 $ 103,111 The following schedule includes TDRs for which there was a payment default during the years ended December 31, 2016 , 2015 and 2014 , whereby the borrower was past due with respect to principal and/or interest for 90 days or more, and the loan became a TDR during the twelve-month period prior to the default: For the years ended December 31, 2016 2015 2014 Number of loans Principal balance at year end Number of loans Principal balance at year end Number of loans Principal balance at year end (Dollars in thousands) Commercial loan portfolio: Commercial — $ — 1 $ 1,206 7 $ 885 Commercial real estate 2 1,721 5 1,016 6 2,352 Subtotal — commercial loan portfolio 2 1,721 6 2,222 13 3,237 Consumer loan portfolio (residential mortgage) 14 259 3 65 12 259 Total 16 $ 1,980 9 $ 2,287 25 $ 3,496 At December 31, 2016 , commitments to lend additional funds to borrowers whose terms have been modified in TDRs totaled $1.5 million Allowance for Loan Losses The following schedule presents, by loan portfolio segment, the changes in the allowance for the years ended December 31, 2016 , 2015 and 2014 , and details regarding the balance in the allowance and the recorded investment in loans at December 31, 2016 and 2015 by impairment evaluation method. (Dollars in thousands) Commercial loan portfolio Consumer loan portfolio Unallocated Total Changes in allowance for loan losses for the year ended December 31, 2016: Beginning balance $ 47,234 $ 26,094 $ — $ 73,328 Provision for loan losses 9,788 5,087 — 14,875 Charge-offs (8,906 ) (6,396 ) — (15,302 ) Recoveries 3,085 2,282 — 5,367 Ending balance $ 51,201 $ 27,067 $ — $ 78,268 Allowance for loan losses balance at December 31, 2016 attributable to: Loans individually evaluated for impairment $ 5,234 $ 3,528 $ — $ 8,762 Loans collectively evaluated for impairment 45,967 23,539 — 69,506 Loans accounted for under ASC 310-30 — — — — Total $ 51,201 $ 27,067 $ — $ 78,268 Recorded investment (loan balance) at December 31, 2016: Loans individually evaluated for impairment $ 78,523 $ 28,346 $ — $ 106,869 Loans collectively evaluated for impairment 4,026,526 3,325,006 — 7,351,532 Loans accounted for under ASC 310-30 3,489,163 2,043,215 — 5,532,378 Total $ 7,594,212 $ 5,396,567 $ — $ 12,990,779 Changes in allowance for loan losses for the year ended December 31, 2015: Beginning balance $ 44,156 $ 28,803 $ 2,724 $ 75,683 Provision (benefit) for loan losses 7,275 1,949 (2,724 ) 6,500 Charge-offs (6,385 ) (7,116 ) — (13,501 ) Recoveries 2,188 2,458 — 4,646 Ending balance $ 47,234 $ 26,094 $ — $ 73,328 Allowance for loan losses balance at December 31, 2015 attributable to: Loans individually evaluated for impairment $ 6,197 $ 192 $ — $ 6,389 Loans collectively evaluated for impairment 41,037 25,902 — 66,939 Loans accounted for under ASC 310-30 — — — — Total $ 47,234 $ 26,094 $ — $ 73,328 Recorded investment (loan balance) at December 31, 2015: Loans individually evaluated for impairment $ 100,379 $ 29,024 $ — $ 129,403 Loans collectively evaluated for impairment 3,030,342 2,648,189 — 5,678,531 Loans accounted for under ASC 310-30 1,119,396 343,817 — 1,463,213 Total $ 4,250,117 $ 3,021,030 $ — $ 7,271,147 Changes in allowance for loan losses for the year ended December 31, 2014: Beginning balance $ 44,482 $ 30,145 $ 4,445 $ 79,072 Provision (benefit) for loan losses 3,464 4,357 (1,721 ) 6,100 Charge-offs (6,399 ) (7,830 ) — (14,229 ) Recoveries 2,609 2,131 — 4,740 Ending balance $ 44,156 $ 28,803 $ 2,724 $ 75,683 |