ALLOWANCE FOR LOAN LOSSES | The following table presents the activity of the allowance for loan losses by portfolio segment for the years ended December 31, 2016 , 2015 and 2014 . Allowance for Loan Losses: December 31, 2016 (Dollar amounts in thousands) Commercial Residential Consumer Unallocated Total Beginning balance $ 11,482 $ 1,834 $ 4,945 $ 1,685 $ 19,946 Provision for loan losses (755 ) 54 3,964 37 3,300 Loans charged -off (2,659 ) (1,011 ) (5,279 ) — (8,949 ) Recoveries 1,663 676 2,137 — 4,476 Ending Balance $ 9,731 $ 1,553 $ 5,767 $ 1,722 $ 18,773 Allowance for Loan Losses: December 31, 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 990 874 3,331 (495 ) 4,700 Loans charged -off (2,852 ) (866 ) (4,810 ) — (8,528 ) Recoveries 2,429 452 2,054 — 4,935 Ending Balance $ 11,482 $ 1,834 $ 4,945 $ 1,685 $ 19,946 Allowance for Loan Losses: December 31, 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* 1,053 134 3,401 (203 ) 4,385 Loans charged -off (3,522 ) (1,143 ) (4,785 ) — (9,450 ) Recoveries 934 798 2,104 — 3,836 Ending Balance $ 10,915 $ 1,374 $ 4,370 $ 2,180 $ 18,839 * Provision before increase of $687 thousand in 2014 for decrease in FDIC indemnification asset The following tables present the allocation of the allowance for loan losses and the recorded investment in loans by portfolio segment and based on impairment method at December 31, 2016 and 2015 : Allowance for Loan Losses: December 31, 2016 (Dollar amounts in thousands) Commercial Residential Consumer Unallocated Total Individually evaluated for impairment $ 242 $ 89 $ — $ — $ 331 Collectively evaluated for impairment 9,489 1,464 5,767 1,722 18,442 Acquired with deteriorated credit quality — — — — — BALANCE AT END OF YEAR $ 9,731 $ 1,553 $ 5,767 $ 1,722 $ 18,773 Loans (Dollar amounts in thousands) Commercial Residential Consumer Total Individually evaluated for impairment $ 8,051 $ 549 $ — $ 8,600 Collectively evaluated for impairment 1,101,269 423,099 307,226 1,831,594 Acquired with deteriorated credit quality 3,415 1,431 — 4,846 BALANCE AT END OF YEAR $ 1,112,735 $ 425,079 $ 307,226 $ 1,845,040 Allowance for Loan Losses: December 31, 2015 (Dollar amounts in thousands) Commercial Residential Consumer Unallocated Total Individually evaluated for impairment $ 953 $ 206 $ — $ — $ 1,159 Collectively evaluated for impairment 10,342 1,628 4,945 1,685 18,600 Acquired with deteriorated credit quality 187 — — — 187 BALANCE AT END OF YEAR $ 11,482 $ 1,834 $ 4,945 $ 1,685 $ 19,946 Loans (Dollar amounts in thousands) Commercial Residential Consumer Total Individually evaluated for impairment $ 8,823 $ 902 $ — $ 9,725 Collectively evaluated for impairment 1,037,086 443,224 274,134 1,754,444 Acquired with deteriorated credit quality 4,092 1,529 — 5,621 BALANCE AT END OF YEAR $ 1,050,001 $ 445,655 $ 274,134 $ 1,769,790 The following table presents loans individually evaluated for impairment by class of loan. December 31, 2016 Allowance Cash Basis Unpaid for Loan Average Interest Interest Principal Recorded Losses Recorded Income Income Balance Investment Allocated Investment Recognized Recognized With no related allowance recorded: Commercial Commercial & Industrial $ 1,181 $ 1,181 $ — $ 981 $ — $ — Farmland 826 826 — 770 — — Non Farm, Non Residential 3,368 2,996 — 3,096 — — Agriculture 622 487 — 351 — — All Other Commercial 1,367 1,367 — 1,477 — — Residential First Liens 25 25 — 27 — — Home Equity — — — — — — Junior Liens — — — — — — Multifamily — — — — — — All Other Residential — — — — — — Consumer Motor Vehicle — — — — — — All Other Consumer — — — — — — With an allowance recorded: Commercial Commercial & Industrial 537 537 36 819 — — Farmland — — — — — — Non Farm, Non Residential 657 657 206 1,016 — Agriculture — — — 114 — — All Other Commercial — — — 45 — — Residential First Liens 524 524 89 647 — — Home Equity — — — — — — Junior Liens — — — — — — Multifamily — — — — — — All Other Residential — — — — — — Consumer Motor Vehicle — — — — — — All Other Consumer — — — — — — TOTAL $ 9,107 $ 8,600 $ 331 $ 9,343 $ — $ — December 31, 2015 Allowance Cash Basis Unpaid for Loan Average Interest Interest Principal Recorded Losses Recorded Income Income Balance Investment Allocated Investment Recognized Recognized With no related allowance recorded: Commercial Commercial & Industrial $ 1,516 $ 1,223 $ — $ 1,796 $ — $ — Farmland — — — — — — Non Farm, Non Residential 3,202 3,202 — 2,080 — — Agriculture — — — — — — All Other Commercial 1,760 1,760 — 1,175 — — Residential First Liens 29 29 — 18 — — Home Equity — — — — — — Junior Liens — — — — — — Multifamily — — — — — — All Other Residential — — — — — — Consumer Motor Vehicle — — — — — — All Other Consumer — — — — — — With an allowance recorded: Commercial Commercial & Industrial 998 998 212 3,463 — — Farmland — — — — — — Non Farm, Non Residential 1,415 1,415 741 3,682 — Agriculture — — — — — — All Other Commercial 225 225 — 483 — — Residential First Liens 873 873 206 460 — — Home Equity — — — — — — Junior Liens — — — — — Multifamily — — — — — — All Other Residential — — — — — — Consumer Motor Vehicle — — — — — — All Other Consumer — — — — — — TOTAL $ 10,018 $ 9,725 $ 1,159 $ 13,157 $ — $ — December 31, 2014 Cash Basis Average Interest Interest Recorded Income Income Investment Recognized Recognized With no related allowance recorded: Commercial Commercial & Industrial $ 2,589 $ — $ — Farmland — — — Non Farm, Non Residential 58 — — Agriculture — — — All Other Commercial 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 6,177 — — Farmland — — — Non Farm, Non Residential 6,698 — — Agriculture — — — All Other Commercial 1,112 — — Residential First Liens 35 — — Home Equity — — — Junior Liens — — — Multifamily — — — All Other Residential — — — Consumer Motor Vehicle — — — All Other Consumer — — — TOTAL $ 16,732 $ — $ — The following table presents the recorded investment in nonperforming loans by class of loans. December 31, 2016 Loans Past Troubled Debt Due Over 90 Day Still Restructured (Dollar amounts in thousands) Accruing Accrual Non-accrual Non-accrual Commercial Commercial & Industrial $ 45 $ 3 $ 383 $ 2,405 Farmland — — — 978 Non Farm, Non Residential — 60 2,941 1,027 Agriculture — — — 744 All Other Commercial — — — 1,380 Residential First Liens 276 3,525 995 5,496 Home Equity — — — 285 Junior Liens 55 — — 202 Multifamily — — — — All Other Residential — — — 94 Consumer Motor Vehicle 293 60 — 140 All Other Consumer — 150 517 741 TOTAL $ 669 $ 3,798 $ 4,836 $ 13,492 December 31, 2015 Loans Past Troubled Debt Due Over 90 Day Still Restructured (Dollar amounts in thousands) Accruing Accrual Non-accrual Non-accrual Commercial Commercial & Industrial $ — $ 5 $ 422 $ 3,187 Farmland — — — 219 Non Farm, Non Residential — 6 3,152 2,545 Agriculture — — — 378 All Other Commercial — — — 1,817 Residential First Liens 809 4,577 1,034 4,839 Home Equity 10 — — 320 Junior Liens 45 — — 211 Multifamily — — — — All Other Residential — — — 111 Consumer Motor Vehicle 148 — 2 213 All Other Consumer 4 — 400 794 TOTAL $ 1,016 $ 4,588 $ 5,010 $ 14,634 Covered loans included in loans past due over 90 days still on accrual are $80 thousand at December 31, 2016 and $37 thousand at December 31, 2015 . Covered loans included in non-accrual loans are $112 thousand at December 31, 2016 and $242 thousand at December 31, 2015 . No covered loans are deemed impaired at December 31, 2016 and 2015. Non-performing loans include both smaller balance homogeneous loans that are collectively evaluated for impairment and individually classified impaired loans. During the years ending December 31, 2016 and 2015 , the terms of certain loans were modified as troubled debt restructurings (TDRs). The following tables present the activity for TDR's. 2016 (Dollar amounts in thousands) Commercial Residential Consumer Total January 1, $ 3,584 $ 5,593 $ 683 $ 9,860 Added — 123 369 492 Charged Off — (321 ) (70 ) (391 ) Payments (198 ) (948 ) (250 ) (1,396 ) December 31, $ 3,386 $ 4,447 $ 732 $ 8,565 2015 (Dollar amounts in thousands) Commercial Residential Consumer Total January 1, $ 8,955 $ 5,189 $ 614 $ 14,758 Added — 748 342 1,090 Charged Off — (65 ) (52 ) (117 ) Payments (5,371 ) (279 ) (221 ) (5,871 ) December 31, $ 3,584 $ 5,593 $ 683 $ 9,860 2014 (Dollar amounts in thousands) Commercial Residential Consumer Total January 1, $ 12,327 $ 4,330 $ 644 $ 17,301 Added 441 1,523 347 2,311 Charged Off (1,069 ) (93 ) (109 ) (1,271 ) Payments (2,744 ) (571 ) (268 ) (3,583 ) December 31, $ 8,955 $ 5,189 $ 614 $ 14,758 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 2016 , 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 . During the years ended December 31, 2016 , 2015 and 2014 the Corporation modified 42, 57 and 69 loans respectively as troubled debt restructurings. In 2016 and 2015 all of the loans modified were smaller balance residential and consumer loans. In 2014 there were 40 of the 69 loans that were modified were consumer in nature. There were no loans that were charged off within 12 months of the modification for 2016, 2015 or 2014. The Corporation had no allocation of specific reserves and $25 thousand and $742 thousand of specific reserves to customers whose loan terms have been modified in troubled debt restructurings at both December 31, 2016 , 2015 and 2014, respectively. The Corporation has not committed to lend additional amounts as of December 31, 2016 and 2015 to customers with outstanding loans that are classified as troubled debt restructurings. The following table presents the aging of the recorded investment in loans by past due category and class of loans. Greater December 31, 2016 30-59 Days 60-89 Days than 90 days Total (Dollar amounts in thousands) Past Due Past Due Past Due Past Due Current Total Commercial Commercial & Industrial $ 370 $ 114 $ 1,199 $ 1,683 $ 474,406 $ 476,089 Farmland 235 22 46 303 110,897 111,200 Non Farm, Non Residential 153 — 215 368 195,120 195,488 Agriculture 246 — 467 713 151,059 151,772 All Other Commercial 15 — — 15 178,171 178,186 Residential First Liens 3,862 954 1,516 6,332 264,446 270,778 Home Equity 186 64 27 277 35,782 36,059 Junior Liens 271 — 224 495 36,912 37,407 Multifamily — — — — 67,799 67,799 All Other Residential 42 12 — 54 12,982 13,036 Consumer Motor Vehicle 4,048 732 313 5,093 277,604 282,697 All Other Consumer 143 22 3 168 24,361 24,529 TOTAL $ 9,571 $ 1,920 $ 4,010 $ 15,501 $ 1,829,539 $ 1,845,040 Greater December 31, 2015 30-59 Days 60-89 Days than 90 days Total (Dollar amounts in thousands) Past Due Past Due Past Due Past Due Current Total Commercial Commercial & Industrial $ 326 $ 274 $ 1,405 $ 2,005 $ 476,984 $ 478,989 Farmland 135 — — 135 106,725 106,860 Non Farm, Non Residential 1,824 90 310 2,224 206,844 209,068 Agriculture 65 38 324 427 143,116 143,543 All Other Commercial 25 32 — 57 111,484 111,541 Residential First Liens 4,960 1,181 1,671 7,812 285,913 293,725 Home Equity 85 23 114 222 37,502 37,724 Junior Liens 179 29 177 385 32,876 33,261 Multifamily — — — — 70,735 70,735 All Other Residential 15 — — 15 10,195 10,210 Consumer Motor Vehicle 3,212 568 181 3,961 247,882 251,843 All Other Consumer 38 10 5 53 22,238 22,291 TOTAL $ 10,864 $ 2,245 $ 4,187 $ 17,296 $ 1,752,494 $ 1,769,790 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. Beginning in July 2016, the Company's loan rating process no longer includes all loans in a loan relationship. Therefore, certain first lien mortgage loans and consumer loans that were previously rated in a loan relationship have been included in the not rated category as of December 31, 2016. As of December 31, 2016 and 2015 , and based on the most recent analysis performed, the risk category of loans by class of loans is as follows: December 31, 2016 Special (Dollar amounts in thousands) Pass Mention Substandard Doubtful Not Rated Total Commercial Commercial & Industrial $ 427,262 $ 16,286 $ 25,177 $ 449 $ 5,730 $ 474,904 Farmland 95,115 8,300 5,238 — 532 109,185 Non Farm, Non Residential 172,739 5,745 16,601 — — 195,085 Agriculture 121,983 13,885 12,301 — 1,366 149,535 All Other Commercial 163,492 596 10,058 76 3,251 177,473 Residential First Liens 43,674 1,541 4,466 18 220,249 269,948 Home Equity 363 — 86 — 35,554 36,003 Junior Liens 1,826 85 401 26 34,977 37,315 Multifamily 66,133 1,430 15 — 65 67,643 All Other Residential — — — — 13,002 13,002 Consumer Motor Vehicle — — 331 — 281,134 281,465 All Other Consumer — — 25 — 24,391 24,416 TOTAL $ 1,092,587 $ 47,868 $ 74,699 $ 569 $ 620,251 $ 1,835,974 December 31, 2015 Special (Dollar amounts in thousands) Pass Mention Substandard Doubtful Not Rated Total Commercial Commercial & Industrial $ 417,880 $ 20,422 $ 32,778 $ 757 $ 5,638 $ 477,475 Farmland 93,418 6,387 5,208 — 16 105,029 Non Farm, Non Residential 180,659 8,114 19,857 — — 208,630 Agriculture 121,244 11,964 8,419 27 170 141,824 All Other Commercial 95,850 2,649 10,887 101 1,535 111,022 Residential First Liens 96,146 4,594 8,598 699 182,791 292,828 Home Equity 11,701 387 669 10 24,895 37,662 Junior Liens 7,493 86 505 58 25,033 33,175 Multifamily 68,972 1,602 — — 23 70,597 All Other Residential 886 — 24 — 9,275 10,185 Consumer Motor Vehicle 10,287 356 534 — 239,543 250,720 All Other Consumer 2,930 77 125 14 19,030 22,176 TOTAL $ 1,107,466 $ 56,638 $ 87,604 $ 1,666 $ 507,949 $ 1,761,323 |