Allowance for Loan Losses | Note 5 – Allowance for Loan Losses The following tables summarize the activity in the allowance for loan losses, and ending balance of loans, net of unearned fees for the periods indicated. Allowance for Loan Losses - Year Ended December 31, 2017 RE Mortgage Home Equity Auto Other Construction (in thousands) Resid. Comm. Lines Loans Indirect Consum. C&I Resid. Comm. Total Beginning balance $ 2,748 $ 11,517 $ 7,044 $ 2,644 — $ 622 $ 5,831 $ 1,417 $ 680 $ 32,503 Charge-offs (60 ) (186 ) (98 ) (332 ) — (1,186 ) (1,444 ) (1,104 ) — (4,410 ) Recoveries — 397 698 242 — 375 428 — 1 2,141 (Benefit) provision (371 ) (287 ) (1,844 ) (713 ) — 775 1,697 871 (39 ) 89 Ending balance $ 2,317 $ 11,441 $ 5,800 $ 1,841 — $ 586 $ 6,512 $ 1,184 $ 642 $ 30,323 Ending balance: Individ. evaluated for impairment $ 230 $ 30 $ 427 $ 107 — $ 57 $ 1,848 — — $ 2,699 Loans pooled for evaluation $ 1,932 $ 11,351 $ 5,356 $ 1,734 — $ 529 $ 4,624 $ 1,184 $ 642 $ 27,352 Loans acquired with deteriorated credit quality $ 155 $ 60 $ 17 — — — $ 40 — — $ 272 Loans, net of unearned fees – As of December 31, 2017 RE Mortgage Home Equity Auto Other Construction (in thousands) Resid. Comm. Lines Loans Indirect Consum. C&I Resid. Comm. Total Ending balance: Total loans $ 385,426 $ 1,914,896 $ 288,688 $ 43,031 — $ 25,155 $ 220,412 $ 67,930 $ 69,627 $ 3,015,165 Individ. evaluated for impairment $ 5,298 $ 13,911 $ 2,688 $ 1,470 — $ 257 $ 4,470 $ 140 — $ 28,234 Loans pooled for evaluation $ 378,743 $ 1,892,422 $ 283,502 $ 41,076 — $ 24,853 $ 213,358 $ 67,790 $ 69,627 $ 2,971,371 Loans acquired with deteriorated credit quality $ 1,385 $ 8,563 $ 2,498 $ 485 — $ 45 $ 2,584 — — $ 15,560 Allowance for Loan Losses - Year Ended December 31, 2016 RE Mortgage Home Equity Auto Other Construction (in thousands) Resid. Comm. Lines Loans Indirect Consum. C&I Resid. Comm. Total Beginning balance $ 2,896 $ 11,015 $ 11,253 $ 3,177 — $ 688 $ 5,271 $ 899 $ 812 $ 36,011 Charge-offs (321 ) (827 ) (585 ) (219 ) — (823 ) (455 ) — — (3,230 ) Recoveries 880 920 2,317 590 — 449 404 54 78 5,692 (Benefit) provision (707 ) 409 (5,941 ) (904 ) — 308 611 464 (210 ) (5,970 ) Ending balance $ 2,748 $ 11,517 $ 7,044 $ 2,644 — $ 622 $ 5,831 $ 1,417 $ 680 $ 32,503 Ending balance: Individ. evaluated for impairment $ 258 $ 4 $ 411 $ 215 — $ 28 $ 1,130 — — $ 2,046 Loans pooled for evaluation $ 2,304 $ 10,064 $ 6,616 $ 2,365 — $ 594 $ 3,765 $ 1,372 $ 680 $ 27,760 Loans acquired with deteriorated credit quality $ 186 $ 1,449 $ 17 $ 64 — — $ 936 $ 45 — $ 2,697 Loans, net of unearned fees – As of December 31, 2016 RE Mortgage Home Equity Auto Other Construction (in thousands) Resid. Comm. Lines Loans Indirect Consum. C&I Resid. Comm. Total Ending balance: Total loans $ 368,343 $ 1,685,121 $ 289,715 $ 46,182 — $ 30,766 $ 217,047 $ 55,429 $ 66,990 $ 2,759,593 Individ. evaluated for impairment $ 4,094 $ 15,081 $ 3,196 $ 1,508 — $ 154 $ 4,096 $ 11 — $ 28,140 Loans pooled for evaluation $ 362,780 $ 1,657,238 $ 282,159 $ 42,992 — $ 30,547 $ 208,960 $ 54,743 $ 66,990 $ 2,706,409 Loans acquired with deteriorated credit quality $ 1,469 $ 12,802 $ 4,360 $ 1,682 — $ 65 $ 3,991 $ 675 — $ 25,044 Allowance for Loan Losses - Year Ended December 31, 2015 RE Mortgage Home Equity Auto Other Construction (in thousands) Resid. Comm. Lines Loans Indirect Consum. C&I Resid. Comm. Total Beginning balance $ 3,086 $ 9,227 $ 15,676 $ 1,797 $ 9 $ 719 $ 4,226 $ 1,434 $ 411 $ 36,585 Charge-offs (224 ) — (694 ) (242 ) (4 ) (972 ) (680 ) — — (2,816 ) Recoveries 204 243 666 252 42 500 677 1,728 140 4,452 (Benefit) provision (170 ) 1,545 (4,395 ) 1,370 (47 ) 441 1,048 (2,263 ) 261 (2,210 ) Ending balance $ 2,896 $ 11,015 $ 11,253 $ 3,177 — $ 688 $ 5,271 $ 899 $ 812 $ 36,011 Ending balance: Individ. evaluated for impairment $ 335 $ 396 $ 605 $ 294 — $ 74 $ 1,187 — — $ 2,891 Loans pooled for evaluation $ 2,501 $ 9,167 $ 10,423 $ 2,883 — $ 614 $ 2,983 $ 844 $ 812 $ 30,227 Loans acquired with deteriorated credit quality $ 60 $ 1,452 $ 225 — — — $ 1,101 $ 55 — $ 2,893 Loans, net of unearned fees – As of December 31, 2015 RE Mortgage Home Equity Auto Other Construction (in thousands) Resid. Comm. Lines Loans Indirect Consum. C&I Resid. Comm. Total Ending balance: Total loans $ 314,265 $ 1,497,567 $ 322,492 $ 40,362 — $ 32,429 $ 194,913 $ 46,135 $ 74,774 $ 2,522,937 Individ. evaluated for impairment $ 6,767 $ 32,407 $ 5,747 $ 1,731 — $ 288 $ 2,671 $ 4 $ 490 $ 50,105 Loans pooled for evaluation $ 305,353 $ 1,442,100 $ 309,007 $ 37,004 — $ 32,077 $ 187,393 $ 45,410 $ 74,284 $ 2,432,628 Loans acquired with deteriorated credit quality $ 2,145 $ 23,060 $ 7,738 $ 1,627 — $ 64 $ 4,849 $ 721 — $ 40,204 As part of the on-going (iii) non-performing The Company utilizes a risk grading system to assign a risk grade to each of its loans. Loans are graded on a scale ranging from Pass to Loss. A description of the general characteristics of the risk grades is as follows: • Pass • Special Mention • Substandard • Doubtful • Loss The following tables present ending loan balances by loan category and risk grade for the periods indicated: Credit Quality Indicators – As of December 31, 2017 RE Mortgage Home Equity Auto Other Construction (in thousands) Resid. Comm. Lines Loans Indirect Consum. C&I Resid. Comm. Total Originated loans: Pass $ 315,120 $ 1,649,333 $ 265,345 $ 37,428 — $ 22,432 $ 195,208 $ 67,813 $ 64,492 $ 2,617,171 Special mention 2,234 18,434 2,558 800 — 272 9,492 — 4,872 38,662 Substandard 3,168 22,743 2,039 1,620 — 155 4,737 107 — 34,569 Loss — — — — — — — — — — Total originated $ 320,522 $ 1,690,510 $ 269,942 $ 39,848 — $ 22,859 $ 209,437 $ 67,920 $ 69,364 $ 2,690,402 PNCI loans: Pass $ 61,411 $ 203,751 $ 14,866 $ 2,433 — $ 2,207 $ 8,390 $ 10 $ 263 $ 293,331 Special mention 218 11,513 450 188 — 38 1 — — 12,408 Substandard 1,890 559 932 77 — 6 — — — 3,464 Loss — — — — — — — — — — Total PNCI $ 63,519 $ 215,823 $ 16,248 $ 2,698 — $ 2,251 $ 8,391 $ 10 $ 263 $ 309,203 PCI loans $ 1,385 $ 8,563 $ 2,498 $ 485 — $ 45 $ 2,584 — — $ 15,560 Total loans $ 385,426 $ 1,914,896 $ 288,688 $ 43,031 — 25,155 $ 220,412 $ 67,930 $ 69,627 $ 3,015,165 Credit Quality Indicators – As of December 31, 2016 RE Mortgage Home Equity Auto Other Construction (in thousands) Resid. Comm. Lines Loans Indirect Consum. C&I Resid. Comm. Total Originated loans: Pass $ 278,635 $ 1,399,936 $ 258,024 $ 37,844 — $ 27,542 $ 190,902 $ 54,602 $ 57,808 $ 2,305,293 Special mention 2,992 14,341 2,518 891 — 385 6,133 — 311 27,571 Substandard 2,912 11,551 3,048 2,001 — 240 3,700 11 — 23,463 Loss — — — — — — — — — — Total originated $ 284,539 $ 1,425,828 $ 263,590 $ 40,736 — $ 28,167 $ 200,735 $ 54,613 $ 58,119 $ 2,356,327 PNCI loans: Pass $ 79,000 $ 233,326 $ 20,442 $ 3,506 — $ 2,437 $ 12,320 $ 141 $ 8,871 $ 360,043 Special mention 1,849 5,925 509 173 — 92 1 — — 8,549 Substandard 1,486 7,240 814 85 — 5 — — — 9,630 Loss — — — — — — — — — — Total PNCI $ 82,335 $ 246,491 $ 21,765 $ 3,764 — $ 2,534 $ 12,321 $ 141 $ 8,871 $ 378,222 PCI loans $ 1,469 $ 12,802 $ 4,360 $ 1,682 — $ 65 $ 3,991 $ 675 — $ 25,044 Total loans $ 368,343 $ 1,685,121 $ 289,715 $ 46,182 — $ 30,766 $ 217,047 $ 55,429 $ 66,990 $ 2,759,593 Consumer loans, whether unsecured or secured by real estate, automobiles, or other personal property, are susceptible to three primary risks; non-payment non-payment Problem consumer loans are generally identified by payment history of the borrower (delinquency). The Bank manages its consumer loan portfolios by monitoring delinquency and contacting borrowers to encourage repayment, suggest modifications if appropriate, and, when continued scheduled payments become unrealistic, initiate repossession or foreclosure through appropriate channels. Collateral values may be determined by appraisals obtained through Bank approved, licensed appraisers, qualified independent third parties, public value information (blue book values for autos), sales invoices, or other appropriate means. Appropriate valuations are obtained at initiation of the credit and periodically (every 3-12 Commercial real estate loans generally fall into two categories, owner-occupied and non-owner non-owner Construction loans, whether owner occupied or non-owner Problem C&I loans are generally identified by periodic review of financial information which may include financial statements, tax returns, rent rolls and payment history of the borrower (delinquency). Based on this information the Bank may decide to take any of several courses of action including demand for repayment, additional collateral or guarantors, and, when repayment becomes unlikely through borrower’s income and cash flow, repossession or foreclosure of the underlying collateral. Collateral values may be determined by appraisals obtained through Bank approved, licensed appraisers, qualified independent third parties, public value information (blue book values for autos), sales invoices, or other appropriate means. Appropriate valuations are obtained at initiation of the credit and periodically (every 3-12 Once a loan becomes delinquent and repayment becomes questionable, a Bank collection officer will address collateral shortfalls with the borrower and attempt to obtain additional collateral. If this is not forthcoming and payment in full is unlikely, the Bank will estimate its probable loss, using a recent valuation as appropriate to the underlying collateral less estimated costs of sale, and charge the loan down to the estimated net realizable amount. Depending on the length of time until ultimate collection, the Bank may revalue the underlying collateral and take additional charge-offs as warranted. Revaluations may occur as often as every 3-12 The following table shows the ending balance of current, past due, and nonaccrual originated loans by loan category as of the date indicated: Analysis of Past Due and Nonaccrual Originated Loans – As of December 31, 2017 RE Mortgage Home Equity Auto Other Construction (in thousands) Resid. Comm. Lines Loans Indirect Consum. C&I Resid. Comm. Total Originated loan balance: Past due: 30-59 Days $ 1,740 $ 158 $ 528 $ 511 — $ 56 $ 956 $ 34 — $ 3,983 60-89 Days 510 987 48 107 — 36 738 — — 2,426 > 90 Days 243 — 372 373 — 3 1,527 — — 2,518 Total past due $ 2,493 $ 1,145 $ 948 $ 991 — $ 95 $ 3,221 $ 34 — $ 8,927 Current 318,029 1,689,365 268,994 38,857 — 22,764 206,216 67,886 $ 69,364 2,681,475 Total orig. loans $ 320,522 $ 1,690,510 $ 269,942 $ 39,848 — $ 22,859 $ 209,437 $ 67,920 $ 69,364 $ 2,690,402 > 90 Days and still accruing — — — — — — — — — — Nonaccrual loans $ 1,725 $ 8,144 $ 811 $ 1,106 — $ 7 $ 3,669 — — $ 15,462 The following table shows the ending balance of current, past due, and nonaccrual PNCI loans by loan category as of the date indicated: Analysis of Past Due and Nonaccrual PNCI Loans – As of December 31, 2017 RE Mortgage Home Equity Auto Other Construction (in thousands) Resid. Comm. Lines Loans Indirect Consum. C&I Resid. Comm. Total PNCI loan balance: Past due: 30-59 Days $ 1,495 $ 70 $ 298 $ 30 — $ 6 — — — $ 1,899 60-89 Days 90 — 228 — — 26 — — — 344 > 90 Days 109 — 330 — — — — — — 439 Total past due $ 1,694 $ 70 $ 856 $ 30 — $ 32 — — — $ 2,682 Current 61,825 215,753 15,392 2,668 — 2,219 $ 8,391 $ 10 $ 263 306,521 Total PNCI loans $ 63,519 $ 215,823 $ 16,248 $ 2,698 — $ 2,251 $ 8,391 $ 10 $ 263 $ 309,203 > 90 Days and still accruing $ 81 — $ 200 — — — — — — $ 281 Nonaccrual loans $ 1,012 — $ 402 $ 44 — $ 5 — — — $ 1,463 The following table shows the ending balance of current, past due, and nonaccrual originated loans by loan category as of the date indicated: Analysis of Past Due and Nonaccrual Originated Loans – As of December 31, 2016 RE Mortgage Home Equity Auto Other Construction (in thousands) Resid. Comm. Lines Loans Indirect Consum. C&I Resid. Comm. Total Originated loan balance: Past due: 30-59 $ 552 $ 317 $ 754 $ 646 — $ 16 $ 1,148 $ 921 — $ 4,354 60-89 269 1,387 — 395 — 30 84 — $ 421 2,586 > 90 Days — 216 687 184 — 15 634 11 — 1,747 Total past due $ 821 $ 1,920 $ 1,441 $ 1,225 — $ 61 $ 1,866 $ 932 $ 421 $ 8,687 Current 283,718 1,423,908 262,149 39,511 — 28,106 198,869 53,681 57,698 2,347,640 Total orig. loans $ 284,539 $ 1,425,828 $ 263,590 $ 40,736 — $ 28,167 $ 200,735 $ 54,613 $ 58,119 $ 2,356,327 > 90 Days and still accruing — — — — — — — — — — Nonaccrual loans $ 255 $ 7,651 $ 1,211 $ 803 — $ 33 $ 2,930 $ 11 — $ 12,894 The following table shows the ending balance of current, past due, and nonaccrual PNCI loans by loan category as of the date indicated: Analysis of Past Due and Nonaccrual PNCI Loans – As of December 31, 2016 RE Mortgage Home Equity Auto Other Construction (in thousands) Resid. Comm. Lines Loans Indirect Consum. C&I Resid. Comm. Total PNCI loan balance: Past due: 30-59 $ 1,510 $ 73 $ 274 $ 39 — — — — — $ 1,896 60-89 — — — — — — — — — — > 90 Days 21 81 589 13 — — — — — 704 Total past due $ 1,531 $ 154 $ 863 $ 52 — — — — — $ 2,600 Current 80,804 246,337 20,902 3,712 — $ 2,534 $ 12,321 $ 141 $ 8,871 375,622 Total PNCI loans $ 82,335 $ 246,491 $ 21,765 $ 3,764 — $ 2,534 $ 12,321 $ 141 $ 8,871 $ 378,222 > 90 Days and still accruing — — — — — — — — — — Nonaccrual loans $ 194 $ 1,826 $ 742 $ 67 — $ 5 — — — $ 2,834 Impaired originated loans are those where management has concluded that it is probable that the borrower will be unable to pay all amounts due under the contractual terms. The following tables show the recorded investment (financial statement balance), unpaid principal balance, average recorded investment, and interest income recognized for impaired Originated and PNCI loans, segregated by those with no related allowance recorded and those with an allowance recorded for the periods indicated. Impaired Originated Loans – As of December 31, 2017 RE Mortgage Home Equity Auto Other Construction (in thousands) Resid. Comm. Lines Loans Indirect Consum. C&I Resid. Comm. Total With no related allowance recorded: Recorded investment $ 2,058 $ 13,101 $ 1,093 $ 1,107 — $ 4 $ 575 $ 140 — $ 18,078 Unpaid principal $ 2,109 $ 13,360 $ 1,175 $ 1,429 — $ 52 $ 585 $ 140 — $ 18,850 Average recorded Investment $ 1,875 $ 13,123 $ 1,287 $ 852 — $ 10 $ 668 $ 76 — $ 17,891 Interest income Recognized $ 85 $ 609 $ 39 $ 14 — — $ 18 $ 9 — $ 774 With an allowance recorded: Recorded investment $ 1,881 $ 810 $ 401 $ 198 — $ 3 $ 3,895 — — $ 7,188 Unpaid principal $ 1,914 $ 826 $ 406 $ 198 — $ 3 $ 3,981 — — $ 7,328 Related allowance $ 230 $ 30 $ 111 $ 10 — $ 3 $ 1,848 — — $ 2,232 Average recorded Investment $ 1,626 $ 728 $ 415 $ 341 — $ 10 $ 3,615 — — $ 6,735 Interest income Recognized $ 58 $ 36 $ 8 $ 10 — — $ 166 — — $ 278 Impaired PNCI Loans – As of December 31, 2017 RE Mortgage Home Equity Auto Other Construction (in thousands) Resid. Comm. Lines Loans Indirect Consum. C&I Resid. Comm. Total With no related allowance recorded: Recorded investment $ 1,359 — $ 591 $ 44 — — — — — $ 1,994 Unpaid principal $ 1,404 — $ 612 $ 57 — — — — — $ 2,073 Average recorded Investment $ 911 $ 913 $ 663 $ 56 — $ 2 — — — $ 2,545 Interest income Recognized $ 24 — $ 22 — — — — — — $ 46 With an allowance recorded: Recorded investment — — $ 603 $ 121 — $ 250 — — — $ 974 Unpaid principal — — $ 604 $ 121 — $ 250 — — — $ 975 Related allowance — — $ 316 $ 97 — $ 54 — — — $ 467 Average recorded Investment $ 130 $ 66 $ 577 $ 61 — $ 184 — — — $ 1,018 Interest income Recognized — — $ 26 $ 6 — $ 11 — — — $ 43 Impaired Originated Loans – As of December 31, 2016 RE Mortgage Home Equity Auto Other Construction (in thousands) Resid. Comm. Lines Loans Indirect Consum. C&I Resid. Comm. Total With no related allowance recorded: Recorded investment $ 1,820 $ 12,898 $ 1,480 $ 715 — $ 15 $ 762 $ 11 — $ 17,701 Unpaid principal $ 1,829 $ 13,145 $ 1,561 $ 1,135 — $ 29 $ 926 $ 16 — $ 18,641 Average recorded Investment $ 2,853 $ 20,003 $ 2,221 $ 831 $ 1 $ 16 $ 669 $ 7 — $ 26,601 Interest income Recognized $ 92 $ 570 $ 40 $ 6 — $ 1 $ 48 — — $ 757 With an allowance recorded: Recorded investment $ 1,551 $ 357 $ 430 $ 594 — $ 19 $ 3,334 — — $ 6,285 Unpaid principal $ 1,552 $ 358 $ 440 $ 595 — $ 19 $ 3,385 — — $ 6,349 Related allowance $ 180 $ 4 $ 110 $ 107 — $ 13 $ 1,130 — — $ 1,544 Average recorded Investment $ 1,779 $ 888 $ 1,076 $ 634 — $ 9 $ 2,714 — — $ 7,100 Interest income Recognized $ 65 $ 22 $ 9 $ 31 — $ 2 $ 77 — — $ 206 Impaired PNCI Loans – As of December 31, 2016 RE Mortgage Home Equity Auto Other Construction (in thousands) Resid. Comm. Lines Loans Indirect Consum. C&I Resid. Comm. Total With no related allowance recorded: Recorded investment $ 463 $ 1,826 $ 735 $ 67 — $ 3 — — — $ 3,094 Unpaid principal $ 486 $ 2,031 $ 746 $ 74 — $ 4 — — — $ 3,341 Average recorded Investment $ 669 $ 1,479 $ 594 $ 69 — $ 18 $ 1 — $ 245 $ 3,075 Interest income Recognized $ 7 — $ 9 $ 1 — — — — — $ 17 With an allowance recorded: Recorded investment $ 259 — $ 551 $ 132 — $ 118 — — — $ 1,060 Unpaid principal $ 259 — $ 551 $ 132 — $ 118 — — — $ 1,060 Related allowance $ 79 — $ 300 $ 108 — $ 15 — — — $ 502 Average recorded Investment $ 130 $ 1,374 $ 579 $ 85 — $ 176 — — — $ 2,344 Interest income Recognized $ 10 — $ 27 $ 7 — $ 5 — — — $ 49 At December 31, 2017, $12,517,000 of Originated loans were TDRs and classified as impaired. The Company had obligations to lend $1,000 of additional funds on these TDRs as of December 31, 2017. At December 31, 2017, $1,352,000 of PNCI loans were TDRs and classified as impaired. The Company had no obligations to lend additional funds on these TDRs as of December 31, 2017. At December 31, 2016, $12,371,000 of Originated loans were TDRs and classified as impaired. The Company had obligations to lend $25,000 of additional funds on these TDRs as of December 31, 2016. At December 31, 2016, $1,324,000 of PNCI loans were TDRs and classified as impaired. The Company had no obligations to lend additional funds on these TDRs as of December 31, 2016. At December 31, 2015, $29,269,000 of Originated loans were TDRs and classified as impaired. The Company had obligations to lend $35,000 of additional funds on these TDRs as of December 31, 2015. At December 31, 2015, $1,396,000 of PNCI loans were TDRs and classified as impaired. The Company had no obligations to lend additional funds on these TDRs as of December 31, 2015. The following tables show certain information regarding Troubled Debt Restructurings (TDRs) that occurred during the periods indicated: TDR Information for the Year Ended December 31, 2017 RE Mortgage Home Equity Auto Other Construction (dollars in thousands) Resid. Comm. Lines Loans Indirect Consum. C&I Resid. Comm. Total Number 1 8 3 1 — 1 11 1 — 26 Pre-mod $ 939 $ 3,721 $ 187 $ 252 — $ 14 $ 1,854 $ 144 — $ 7,111 Post-mod $ 939 $ 3,695 $ 187 $ 252 — $ 14 $ 1,747 $ 144 — $ 6,978 Financial impact due to TDR taken as additional provision $ 169 $ (111 ) $ 27 — — $ 11 $ 37 — — $ 133 Number that defaulted during the period 2 1 1 1 — — — — — 5 Recorded investment of TDRs that subsequently defaulted during the 12 month period after modification $ 223 $ 219 $ 127 $ 55 — — — — — $ 624 Financial impact due to the default of previous TDR taken as charge-offs or additional provisions — — $ (5 ) — — — — — — $ (5 ) TDR Information for the Year Ended December 31, 2016 RE Mortgage Home Equity Auto Other Construction (dollars in thousands) Resid. Comm. Lines Loans Indirect Consum. C&I Resid. Comm. Total Number 3 5 9 1 — 2 4 — — 24 Pre-mod $ 650 $ 423 $ 707 $ 105 — $ 27 $ 77 — — $ 1,989 Post-mod $ 656 $ 461 $ 709 $ 105 — $ 27 $ 77 — — $ 2,035 Financial impact due to TDR taken as additional provision $ 50 $ 46 $ 205 — — $ 2 $ 23 — — $ 326 Number that defaulted during the period 2 — 1 — — — — — — 3 Recorded investment of TDRs that subsequently defaulted during the 12 month period after modification $ 101 — $ 229 — — — — — — $ 330 Financial impact due to the default of previous TDR taken as charge-offs or additional provisions — — — — — — — — — — TDR Information for the Year Ended December 31, 2015 RE Mortgage Home Equity Auto Other Construction (dollars in thousands) Resid. Comm. Lines Loans Indirect Consum. C&I Resid. Comm. Total Number 4 5 2 2 — 2 8 — — 23 Pre-mod outstanding principal balance $ 800 $ 1,518 $ 301 $ 315 — $ 89 $ 956 — — $ 3,979 Post-mod outstanding principal balance $ 801 $ 1,517 $ 301 $ 321 — $ 89 $ 944 — — $ 3,973 Financial impact due to TDR taken as additional provision $ 8 $ (5 ) — $ 38 $ 5 $ 405 — — $ 451 Number that defaulted during the period 4 2 3 1 — — — — — 10 Recorded investment of TDRs that subsequently defaulted during the 12 month period after modification $ 221 $ 280 $ 182 $ 53 — — — — — $ 736 Financial impact due to the default of previous TDR taken as charge-offs or additional provisions — — — $ (9 ) — — — — — $ (9 ) Modifications classified as Troubled Debt Restructurings can include one or a combination of the following: rate modifications, term extensions, interest only modifications, either temporary or long-term, payment modifications, and collateral substitutions/additions. For all new Troubled Debt Restructurings, an impairment analysis is conducted. If the loan is determined to be collateral dependent, any additional amount of impairment will be calculated based on the difference between estimated collectible value and the current carrying balance of the loan. This difference could result in an increased provision and is typically charged off. If the asset is determined not to be collateral dependent, the impairment is measured on the net present value difference between the expected cash flows of the restructured loan and the cash flows which would have been received under the original terms. The effect of this could result in a requirement for additional provision to the reserve. The effect of these required provisions for the period are indicated above. Typically if a TDR defaults during the period, the loan is then considered collateral dependent and, if it was not already considered collateral dependent, an appropriate provision will be reserved or charge will be taken. The additional provisions required resulting from default of previously modified TDR’s are noted above. |