Allowance for Loan Losses | The following table presents the activity of the allowance for loan losses by portfolio segment for the three months ended June 30. Allowance for Loan Losses: June 30, 2015 (Dollar amounts in thousands) Commercial Residential Consumer Unallocated Total Beginning balance $ 10,818 $ 1,622 $ 4,494 $ 2,417 $ 19,351 Provision for loan losses 160 277 638 75 1,150 Loans charged -off (272 ) (181 ) (1,026 ) — (1,479 ) Recoveries 225 42 572 — 839 Ending Balance $ 10,931 $ 1,760 $ 4,678 $ 2,492 $ 19,861 Allowance for Loan Losses: June 30, 2014 (Dollar amounts in thousands) Commercial Residential Consumer Unallocated Total Beginning balance $ 12,453 $ 1,581 $ 3,864 $ 2,510 $ 20,408 Provision for loan losses* (1,051 ) (54 ) 533 (248 ) (820 ) Loans charged -off (710 ) (633 ) (982 ) — (2,325 ) Recoveries 158 480 354 — 992 Ending Balance $ 10,850 $ 1,374 $ 3,769 $ 2,262 $ 18,255 * Provision before increase of $ 464 thousand in 2014 for decrease in FDIC indemnification asset The following table presents the activity of the allowance for loan losses by portfolio segment for the six months ended June 30 Allowance for Loan Losses: June 30, 2015 (Dollar amounts in thousands) Commercial Residential Consumer Unallocated Total Beginning balance $ 10,915 $ 1,374 $ 4,370 $ 2,180 $ 18,839 Provision for loan losses 167 653 1,468 312 2,600 Loans charged -off (608 ) (406 ) (2,288 ) — (3,302 ) Recoveries 457 139 1,128 — 1,724 Ending Balance $ 10,931 $ 1,760 $ 4,678 $ 2,492 $ 19,861 Allowance for Loan Losses: June 30, 2014 (Dollar amounts in thousands) Commercial Residential Consumer Unallocated Total Beginning balance $ 12,450 $ 1,585 $ 3,650 $ 2,383 $ 20,068 Provision for loan losses* (319 ) 12 1,333 (121 ) 905 Loans charged -off (1,646 ) (805 ) (2,035 ) — (4,486 ) Recoveries 365 582 821 — 1,768 Ending Balance $ 10,850 $ 1,374 $ 3,769 $ 2,262 $ 18,255 * Provision before increase of $699 thousand in 2014 for decrease in FDIC indemnification asset The following table presents the allocation of the allowance for loan losses and the recorded investment in loans by portfolio segment and based on the impairment method at June 30, 2015 and December 31, 2014 . Allowance for Loan Losses June 30, 2015 (Dollar amounts in thousands) Commercial Residential Consumer Unallocated Total Individually evaluated for impairment $ 1,305 $ 27 $ — $ — $ 1,332 Collectively evaluated for impairment 9,411 1,733 4,678 2,492 18,314 Acquired with deteriorated credit quality 215 — — — 215 Ending Balance $ 10,931 $ 1,760 $ 4,678 $ 2,492 $ 19,861 Loans: June 30, 2015 (Dollar amounts in thousands) Commercial Residential Consumer Total Individually evaluated for impairment $ 15,767 $ 257 $ — $ 16,024 Collectively evaluated for impairment 1,054,233 444,548 269,039 1,767,820 Acquired with deteriorated credit quality 4,291 1,604 — 5,895 Ending Balance $ 1,074,291 $ 446,409 $ 269,039 $ 1,789,739 Allowance for Loan Losses: December 31, 2014 (Dollar amounts in thousands) Commercial Residential Consumer Unallocated Total Individually evaluated for impairment 1,911 — — — 1,911 Collectively evaluated for impairment 8,733 1,365 4,370 2,180 16,648 Acquired with deteriorated credit quality 271 9 — — 280 Ending Balance $ 10,915 $ 1,374 $ 4,370 $ 2,180 $ 18,839 Loans December 31, 2014 (Dollar amounts in thousands) Commercial Residential Consumer Total Individually evaluated for impairment 14,573 33 — 14,606 Collectively evaluated for impairment 1,030,949 468,872 267,880 1,767,701 Acquired with deteriorated credit quality 4,887 1,631 — 6,518 Ending Balance $ 1,050,409 $ 470,536 $ 267,880 $ 1,788,825 The following tables present loans individually evaluated for impairment by class of loans. June 30, 2015 Unpaid Principal Recorded Allowance for Loan Losses Average Recorded Interest Income Cash Basis Interest (Dollar amounts in thousands) Balance Investment Allocated Investment Recognized Recognized With no related allowance recorded: Commercial Commercial & Industrial $ 6,821 $ 5,307 $ — $ 2,161 $ — $ — Farmland — — — — — — Non Farm, Non Residential 3,955 3,955 — 1,318 — — Agriculture — — — — — — All Other Commercial 1,793 1,793 — 780 — — Residential First Liens 31 31 — 10 — — Home Equity — — — — — — Junior Liens — — — — — — Multifamily — — — — — — All Other Residential — — — — — — Consumer Motor Vehicle — — — — — — All Other Consumer — — — — — — With an allowance recorded: Commercial Commercial & Industrial 2,102 1,809 294 4,900 — — Farmland — — — — — — Non Farm, Non Residential 2,350 2,351 919 5,162 — — Agriculture — — — — — — All Other Commercial 552 552 92 653 — — Residential First Liens 226 226 27 175 — — Home Equity — — — — — — Junior Liens — — — — — — Multifamily — — — — — — All Other Residential — — — — — — Consumer Motor Vehicle — — — — — — All Other Consumer — — — — — — TOTAL $ 17,830 $ 16,024 $ 1,332 $ 15,159 $ — $ — December 31, 2014 Unpaid Principal Recorded Allowance for Loan Losses Average Recorded Interest Income Cash Basis Interest Income (Dollar amounts in thousands) Balance Investment Allocated Investment Recognized Recognized With no related allowance recorded: Commercial Commercial & Industrial $ 1,200 $ 926 $ — $ 2,589 $ — $ — Farmland — — — — — — Non Farm, Non Residential — — — 58 — — Agriculture — — — — — — All Other Commercial 292 292 — 58 — — Residential First Liens — — — 5 — — Home Equity — — — — — — Junior Liens — — — — — — Multifamily — — — — — — All Other Residential — — — — — — Consumer Motor Vehicle — — — — — — All Other Consumer — — — — — — With an allowance recorded: Commercial Commercial & Industrial 7,388 5,874 1,056 6,177 — — Farmland — — — — — — Non Farm, Non Residential 6,654 6,654 753 6,698 — — Agriculture — — — — — — All Other Commercial 827 827 102 1,112 — — Residential First Liens 33 33 — 35 — — Home Equity — — — — — — Junior Liens — — — — — — Multifamily — — — — — — All Other Residential — — — — — — Consumer Motor Vehicle — — — — — — All Other Consumer — — — — — — TOTAL $ 16,394 $ 14,606 $ 1,911 $ 16,732 $ — $ — Three Months Ended Six Months Ended Average Interest Cash Basis Average Interest Cash Basis (Dollar amounts in thousands) Investment Recognized Recognized Investment Recognized Recognized With no related allowance recorded: Commercial Commercial & Industrial $ 2,779 $ — $ — $ 2,161 $ — $ — Farmland — — — — — — Non Farm, Non Residential 1,978 — — 1,318 — — Agriculture — — — — — — All Other Commercial 1,025 — — 780 — — Residential First Liens 16 — — 10 — — Home Equity — — — — — — Junior Liens — — — — — — Multifamily — — — — — — All Other Residential — — — — — — Consumer Motor Vehicle — — — — — — All Other Consumer — — — — — — With an allowance recorded: Commercial Commercial & Industrial 4,413 — — 4,900 — — Farmland — — — — — — Non Farm, Non Residential 4,417 — — 5,162 — — Agriculture — — — — — — All Other Commercial 566 — — 653 — — Residential First Liens 246 — — 175 — — Home Equity — — — — — — Junior Liens — — — — — — Multifamily — — — — — — All Other Residential — — — — — — Consumer Motor Vehicle — — — — — — All Other Consumer — — — — — — TOTAL $ 15,440 $ — $ — $ 15,159 $ — $ — Three Months Ended Six Months Ended Average Interest Cash Basis Average Interest Cash Basis (Dollar amounts in thousands) Investment Recognized Recognized Investment Recognized Recognized With no related allowance recorded: Commercial Commercial & Industrial $ 1,080 $ — $ — $ 1,359 $ — $ — Farmland — — — — — — Non Farm, Non Residential 93 — — 97 — — Agriculture — — — — — — All Other Commercial — — — — — — Residential First Liens — — — — — — Home Equity — — — — — — Junior Liens — — — — — — Multifamily — — — — — — All Other Residential — — — — — — Consumer Motor Vehicle — — — — — — All Other Consumer — — — — — — With an allowance recorded: Commercial Commercial & Industrial 7,466 — — 7,850 — — Farmland — — — — — — Non Farm, Non Residential 6,397 — — 6,666 — — Agriculture — — — — — — All Other Commercial 1,207 — — 1,159 — — Residential First Liens 36 — — 36 — — Home Equity — — — — — — Junior Liens — — — — — — Multifamily — — — — — — All Other Residential — — — — — — Consumer Motor Vehicle — — — — — — All Other Consumer — — — — — — TOTAL $ 16,279 $ — $ — $ 17,167 $ — $ — The tables below presents the recorded investment in non-performing loans. June 30, 2015 Loans Past Due Over 90 Day Still Troubled Debt (Dollar amounts in thousands) Accruing Accruing Nonaccrual Nonaccrual Commercial Commercial & Industrial $ — $ 5 $ 4,793 $ 4,002 Farmland — — — 228 Non Farm, Non Residential — 9 3,898 3,419 Agriculture — — — 537 All Other Commercial — — — 2,334 Residential First Liens 626 4,597 1,007 4,275 Home Equity 24 — — 306 Junior Liens 63 — — 157 Multifamily — — — — All Other Residential — — — 99 Consumer Motor Vehicle 38 208 15 137 All Other Consumer 5 21 414 1,059 TOTAL $ 756 $ 4,840 $ 10,127 $ 16,553 December 31, 2014 Loans Past Due Over 90 Day Still Troubled Debt (Dollar amounts in thousands) Accruing Accruing Nonaccrual Nonaccrual Commercial Commercial & Industrial $ — $ 7 $ 4,961 $ 3,720 Farmland — — — 79 Non Farm, Non Residential — 10 3,987 3,388 Agriculture — — — 767 All Other Commercial — — — 1,258 Residential First Liens 603 4,357 842 3,861 Home Equity 88 — — 404 Junior Liens 12 — — 275 Multifamily — — — — All Other Residential 5 — — 111 Consumer Motor Vehicle 162 257 83 210 All Other Consumer 3 1 269 961 TOTAL $ 873 $ 4,632 $ 10,142 $ 15,034 There are no loans covered by loss share agreements with the FDIC included in loans past due over 90 days still on accrual at June 30, 2015 and there were $37 thousand at December 31, 2014 . There were $271 thousand of covered loans included in non-accrual loans at June 30, 2015 and there were $274 thousand at December 31, 2014 . There were no covered loans at June 30, 2015 or December 31, 2014 that were deemed impaired. Non-performing loans include both smaller balance homogeneous loans that are collectively evaluated for impairment and individually classified impaired loans. The following tables presents the aging of the recorded investment in loans by past due category and class of loans. June 30, 2015 30-59 Days 60-89 Days Greater than 90 days Total (Dollar amounts in thousands) Past Due Past Due Past Due Past Due Current Total Commercial Commercial & Industrial $ 386 $ 125 $ 3,568 $ 4,079 $ 495,992 $ 500,071 Farmland — — — — 97,763 97,763 Non Farm, Non Residential 551 223 206 980 217,839 218,819 Agriculture 24 271 27 322 132,839 133,161 All Other Commercial 67 — — 67 124,410 124,477 Residential First Liens 594 703 1,360 2,657 303,745 306,402 Home Equity 182 25 125 332 37,747 38,079 Junior Liens 191 17 158 366 30,533 30,899 Multifamily — — — — 64,051 64,051 All Other Residential — — — — 6,978 6,978 Consumer Motor Vehicle 2,686 379 38 3,103 244,584 247,687 All Other Consumer 83 16 4 103 21,249 21,352 TOTAL $ 4,764 $ 1,759 $ 5,486 $ 12,009 $ 1,777,730 $ 1,789,739 December 31, 2014 30-59 Days 60-89 Days Greater than 90 days Total (Dollar amounts in thousands) Past Due Past Due Past Due Past Due Current Total Commercial Commercial & Industrial $ 574 $ 416 $ 3,046 $ 4,036 $ 451,549 $ 455,585 Farmland — — — — 95,452 95,452 Non Farm, Non Residential 1,528 68 202 1,798 232,440 234,238 Agriculture 246 18 502 766 149,099 149,865 All Other Commercial 255 — — 255 115,014 115,269 Residential First Liens 6,011 963 1,522 8,496 308,068 316,564 Home Equity 141 33 310 484 40,043 40,527 Junior Liens 270 83 217 570 31,487 32,057 Multifamily — — — — 72,310 72,310 All Other Residential 112 — 5 117 8,961 9,078 Consumer Motor Vehicle 3,026 557 180 3,763 242,406 246,169 All Other Consumer 114 7 3 124 21,587 21,711 TOTAL $ 12,277 $ 2,145 $ 5,987 $ 20,409 $ 1,768,416 $ 1,788,825 During the three and six months ended June 30, 2015 and 2014, the terms of certain loans were modified as troubled debt restructurings (TDRs). The following tables present the activity for TDR's. 2015 (Dollar amounts in thousands) Commercial Residential Consumer Total April 1, 8,835 5,618 575 15,028 Added — 73 140 213 Charged Off — — — — Payments (130 ) (102 ) (58 ) (290 ) June 30, 8,705 5,589 657 14,951 2015 (Dollar amounts in thousands) Commercial Residential Consumer Total January 1, 8,955 5,189 614 14,758 Added — 652 189 841 Charged Off — (62 ) (40 ) (102 ) Payments (250 ) (190 ) (106 ) (546 ) June 30, 8,705 5,589 657 14,951 2014 (Dollar amounts in thousands) Commercial Residential Consumer Total April 1, 9,343 4,362 620 21,285 Added 441 668 30 1,139 Charged Off — — (19 ) (19 ) Payments (578 ) (74 ) (72 ) (724 ) June 30, 9,206 4,956 559 14,721 2014 (Dollar amounts in thousands) Commercial Residential Consumer Total January 1, 12,327 4,330 644 21,285 Added 441 801 98 1,340 Charged Off (1,069 ) — (39 ) (1,108 ) Payments (2,493 ) (175 ) (144 ) (2,812 ) June 30, 9,206 4,956 559 14,721 Modification of the terms of such loans typically include one or a combination of the following: a reduction of the stated interest rate of the loan; an extension of the maturity date at a stated rate of interest lower than the current market rate for new debt with similar risk; or a permanent reduction of the recorded investment in the loan. No modification in 2015 or 2014 resulted in the permanent reduction of the recorded investment in the loan. Modifications involving a reduction of the stated interest rate of the loan were for periods ranging from twelve months to five years. Modifications involving an extension of the maturity date were for periods ranging from twelve months to ten years. Troubled debt restructurings during the three and six months ended June 30, 2015 and 2014 did not result in any material charge-offs or additional provision expense. The Corporation has allocated $ 47 thousand and $ 1.2 million of specific reserves to customers whose loan terms have been modified in troubled debt restructurings at both June 30, 2015 and 2014, respectively. The Corporation has not committed to lend additional amounts as of June 30, 2015 and 2014 to customers with outstanding loans that are classified as troubled debt restructurings. The charge-offs during the three and six months ended June 30, 2015 and 2014 were not of any restructurings that had taken place in the previous 12 months. Credit Quality Indicators: The Corporation categorizes loans into risk categories based on relevant information about the ability of borrowers to service their debt such as: current financial information, historical payment experience, credit documentation, public information, and current economic trends, among other factors. The Corporation analyzes loans individually by classifying the loans as to credit risk. This analysis includes non-homogeneous loans, such as commercial loans, with an outstanding balance greater than $100 thousand . Any consumer loans outstanding to a borrower who had commercial loans analyzed will be similarly risk rated. This analysis is performed on a quarterly basis. The Corporation uses the following definitions for risk ratings: Special Mention: Loans classified as special mention have a potential weakness that deserves management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or of the institution’s credit position at some future date. Substandard: Loans classified as substandard are inadequately protected by the current net worth and debt service capacity of the borrower or of any pledged collateral. These loans have a well-defined weakness or weaknesses which have clearly jeopardized repayment of principal and interest as originally intended. They are characterized by the distinct possibility that the institution will sustain some future loss if the deficiencies are not corrected. Doubtful: Loans classified as doubtful have all the weaknesses inherent in those graded substandard, with the added characteristic that the severity of the weaknesses makes collection or liquidation in full highly questionable or improbable based upon currently existing facts, conditions, and values. Furthermore, non-homogeneous loans which were not individually analyzed, but are 90+ days past due or on non-accrual are classified as substandard. Loans included in homogeneous pools, such as residential or consumer may be classified as substandard due to 90+ days delinquency, non-accrual status, bankruptcy, or loan restructuring. Loans not meeting the criteria above that are analyzed individually as part of the above described process are considered to be pass rated loans. Loans listed as not rated are either less than $100 thousand or are included in groups of homogeneous loans. As of June 30, 2015 and December 31, 2014 , and based on the most recent analysis performed, the risk category of loans by class of loans are as follows: June 30, 2015 (Dollar amounts in thousands) Pass Special Mention Substandard Doubtful Not Rated Total Commercial Commercial & Industrial $ 429,845 $ 36,520 $ 23,715 $ 2,755 $ 5,689 $ 498,524 Farmland 85,745 7,747 2,907 — 12 96,411 Non Farm, Non Residential 189,429 6,214 22,659 36 — 218,338 Agriculture 115,653 6,658 9,245 27 156 131,739 All Other Commercial 107,893 6,972 7,191 105 1,659 123,820 Residential First Liens 98,064 5,275 8,106 739 193,208 305,392 Home Equity 11,554 451 1,255 11 24,749 38,020 Junior Liens 7,815 120 490 60 22,329 30,814 Multifamily 61,357 — 2,540 — 22 63,919 All Other Residential 1,258 — 26 — 5,678 6,962 Consumer Motor Vehicle 11,007 421 386 — 234,826 246,640 All Other Consumer 3,088 109 102 16 17,929 21,244 TOTAL $ 1,122,708 $ 70,487 $ 78,622 $ 3,749 $ 506,257 $ 1,781,823 December 31, 2014 (Dollar amounts in thousands) Pass Special Mention Substandard Doubtful Not Rated Total Commercial Commercial & Industrial $ 393,449 $ 29,081 $ 24,013 $ 2,900 $ 4,717 $ 454,160 Farmland 85,772 7,618 436 — 13 93,839 Non Farm, Non Residential 186,346 21,765 25,613 36 — 233,760 Agriculture 138,713 7,399 1,746 177 67 148,102 All Other Commercial 101,942 4,356 7,055 33 1,275 114,661 Residential First Liens 104,854 5,929 7,733 1,035 196,008 315,559 Home Equity 12,592 375 1,374 6 26,116 40,463 Junior Liens 8,112 173 561 63 23,053 31,962 Multifamily 69,080 1,801 1,249 — 3 72,133 All Other Residential 1,799 — 28 — 7,228 9,055 Consumer Motor Vehicle 11,135 402 224 — 233,302 245,063 All Other Consumer 3,169 141 87 21 18,175 21,593 TOTAL $ 1,116,963 $ 79,040 $ 70,119 $ 4,271 $ 509,957 $ 1,780,350 |