Loans | LOANS Loans are summarized as follows: Dollars in thousands March 31, December 31, Commercial $ 189,586 $ 189,981 Commercial real estate Owner-occupied 265,075 250,202 Non-owner occupied 498,445 484,902 Construction and development Land and land development 66,841 67,219 Construction 33,327 33,412 Residential real estate Non-jumbo 346,477 354,101 Jumbo 67,169 62,267 Home equity 83,382 84,028 Mortgage warehouse lines 45,702 30,757 Consumer 34,825 36,202 Other 12,578 13,238 Total loans, net of unearned fees 1,643,407 1,606,309 Less allowance for loan losses 12,257 12,565 Loans, net $ 1,631,150 $ 1,593,744 The outstanding balance and the recorded investment of acquired loans included in the consolidated balance sheet at March 31, 2018 and December 31, 2017 are as follows: Acquired Loans March 31, 2018 December 31, 2017 Dollars in thousands Purchased Credit Impaired Purchased Performing Total Purchased Credit Impaired Purchased Performing Total Outstanding balance $ 5,292 $ 196,608 $ 201,900 $ 5,923 $ 220,131 $ 226,054 Recorded investment Commercial $ — $ 17,945 $ 17,945 $ 9 $ 25,125 $ 25,134 Commercial real estate Owner-occupied 689 20,323 21,012 689 21,893 22,582 Non-owner occupied 1,316 32,148 33,464 1,837 33,293 35,130 Construction and development Land and land development — 6,846 6,846 — 7,512 7,512 Construction — — — — 2,760 2,760 Residential real estate Non-jumbo 1,453 100,734 102,187 1,485 109,570 111,055 Jumbo 993 4,074 5,067 999 3,400 4,399 Home equity — 3,236 3,236 — 3,311 3,311 Consumer — 9,434 9,434 — 11,229 11,229 Other — 155 155 — 211 211 Total recorded investment $ 4,451 $ 194,895 $ 199,346 $ 5,019 $ 218,304 $ 223,323 The following table presents a summary of the change in the accretable yield of the PCI loan portfolio for the three months ended March 31, 2018 and 2017 : Dollars in thousands Three Months Ended Three Months Ended Accretable yield, January 1 $ 745 $ 290 Accretion (37 ) (31 ) Reclassification of nonaccretable difference due to improvement in expected cash flows — — Other changes, net — (14 ) Accretable yield, March 31 $ 708 $ 245 The following table presents the contractual aging of the recorded investment in past due loans by class as of March 31, 2018 and December 31, 2017 . At March 31, 2018 Past Due > 90 days and Accruing Dollars in thousands 30-59 days 60-89 days > 90 days Total Current Commercial $ 675 $ 22 $ 378 $ 1,075 $ 188,511 $ 49 Commercial real estate Owner-occupied 130 295 351 776 264,299 — Non-owner occupied 196 610 1,852 2,658 495,787 — Construction and development Land and land development 179 — 3,637 3,816 63,025 — Construction — — — — 33,327 — Residential mortgage Non-jumbo 3,392 1,503 4,611 9,506 336,971 — Jumbo 969 — — 969 66,200 — Home equity 76 98 272 446 82,936 64 Mortgage warehouse lines — — — — 45,702 — Consumer 293 185 104 582 34,243 32 Other — — — — 12,578 — Total $ 5,910 $ 2,713 $ 11,205 $ 19,828 $ 1,623,579 $ 145 At December 31, 2017 Past Due > 90 days and Accruing Dollars in thousands 30-59 days 60-89 days > 90 days Total Current Commercial $ 488 $ 98 $ 229 $ 815 $ 189,166 $ — Commercial real estate Owner-occupied 626 162 507 1,295 248,907 — Non-owner occupied 369 150 2,065 2,584 482,318 237 Construction and development Land and land development 1,132 — 3,563 4,695 62,524 — Construction — — — — 33,412 — Residential mortgage Non-jumbo 4,220 2,379 4,451 11,050 343,051 — Jumbo — — — — 62,267 — Home equity 1,978 — 530 2,508 81,520 — Mortgage warehouse lines — — — — 30,757 — Consumer 417 196 167 780 35,422 37 Other — — — — 13,238 — Total $ 9,230 $ 2,985 $ 11,512 $ 23,727 $ 1,582,582 $ 274 Nonaccrual loans: The following table presents the nonaccrual loans included in the net balance of loans at March 31, 2018 and December 31, 2017 . March 31, December 31, Dollars in thousands 2018 2017 Commercial $ 685 $ 696 Commercial real estate Owner-occupied 561 726 Non-owner occupied 2,840 2,201 Construction and development Land & land development 3,642 3,569 Construction — — Residential mortgage Non-jumbo 7,101 6,944 Jumbo — — Home equity 355 712 Mortgage warehouse lines — — Consumer 128 201 Total $ 15,312 $ 15,049 Impaired loans: Impaired loans include the following: ▪ Loans which we risk-rate (loan relationships having aggregate balances in excess of $ 2.5 million , or loans exceeding $ 500,000 and exhibiting credit weakness) through our normal loan review procedures and which, based on current information and events, it is probable that we will be unable to collect all amounts due in accordance with the original contractual terms of the loan agreement. Risk-rated loans with insignificant delays or insignificant short falls in the amount of payments expected to be collected are not considered to be impaired. ▪ Loans that have been modified in a troubled debt restructuring. Both commercial and consumer loans are deemed impaired upon being contractually modified in a troubled debt restructuring. Troubled debt restructurings typically result from our loss mitigation activities and occur when we grant a concession to a borrower who is experiencing financial difficulty in order to minimize our economic loss and to avoid foreclosure or repossession of collateral. Once restructured, a loan is generally considered impaired until its maturity, regardless of whether the borrower performs under the modified terms. Although such a loan may be returned to accrual status if the criteria set forth in accounting principles generally accepted in the United States are met, the loan would continue to be evaluated for an asset-specific allowance for loan losses and we would continue to report the loan in the impaired loan table below. The following tables present loans individually evaluated for impairment at March 31, 2018 and December 31, 2017 . March 31, 2018 Dollars in thousands Recorded Investment Unpaid Principal Balance Related Allowance Average Impaired Balance Interest Income Recognized while impaired Without a related allowance Commercial $ 318 $ 318 $ — $ 220 $ 10 Commercial real estate Owner-occupied 2,718 2,719 — 2,719 130 Non-owner occupied 9,752 9,757 — 9,757 491 Construction and development Land & land development 5,017 5,017 — 5,017 104 Construction — — — — — Residential real estate Non-jumbo 4,266 4,273 — 3,575 166 Jumbo 3,520 3,519 — 3,519 167 Home equity 523 523 — 523 27 Mortgage warehouse lines — — — — — Consumer 15 15 — 15 2 Total without a related allowance $ 26,129 $ 26,141 $ — $ 25,345 $ 1,097 With a related allowance Commercial $ — $ — $ — $ — $ — Commercial real estate Owner-occupied 6,756 6,756 124 6,756 274 Non-owner occupied 329 331 24 331 23 Construction and development Land & land development 1,455 1,456 515 1,456 54 Construction — — — — — Residential real estate Non-jumbo 1,872 1,873 192 1,873 73 Jumbo 834 834 13 834 49 Home equity — — — — — Mortgage warehouse lines — — — — — Consumer — — — — — Total with a related allowance $ 11,246 $ 11,250 $ 868 $ 11,250 $ 473 Total Commercial $ 26,345 $ 26,354 $ 663 $ 26,256 $ 1,086 Residential real estate 11,015 11,022 205 10,324 482 Consumer 15 15 — 15 2 Total $ 37,375 $ 37,391 $ 868 $ 36,595 $ 1,570 The table above does not include PCI loans. December 31, 2017 Dollars in thousands Recorded Investment Unpaid Principal Balance Related Allowance Average Impaired Balance Interest Income Recognized while impaired Without a related allowance Commercial $ 243 $ 243 $ — $ 259 $ 13 Commercial real estate Owner-occupied 7,109 7,111 — 5,149 265 Non-owner occupied 9,105 9,106 — 9,736 684 Construction and development Land & land development 5,018 5,018 — 4,743 329 Construction — — — — — Residential real estate Non-jumbo 4,190 4,199 — 4,214 240 Jumbo 3,555 3,554 — 3,592 228 Home equity 523 523 — 523 35 Mortgage warehouse lines — — — — — Consumer 17 17 — 28 3 Total without a related allowance $ 29,760 $ 29,771 $ — $ 28,244 $ 1,797 With a related allowance Commercial $ 252 $ 252 $ 252 $ 262 $ — Commercial real estate Owner-occupied 2,436 2,436 125 2,451 161 Non-owner occupied 1,338 1,344 517 676 43 Construction and development Land & land development 1,464 1,464 524 1,477 74 Construction — — — — — Residential real estate Non-jumbo 1,717 1,718 158 1,691 100 Jumbo 838 839 14 845 57 Home equity — — — — — Mortgage warehouse lines — — — — — Consumer — — — — — Total with a related allowance $ 8,045 $ 8,053 $ 1,590 $ 7,402 $ 435 Total Commercial $ 26,965 $ 26,974 $ 1,418 $ 24,753 $ 1,569 Residential real estate 10,823 10,833 172 10,865 660 Consumer 17 17 — 28 3 Total $ 37,805 $ 37,824 $ 1,590 $ 35,646 $ 2,232 The table above does not include PCI loans. Included in impaired loans are TDRs of $27.5 million , of which $27.4 million were current with respect to restructured contractual payments at March 31, 2018 , and $28.4 million , all of which were current with respect to restructured contractual payments at December 31, 2017 . There were no commitments to lend additional funds under these restructurings at either balance sheet date. The following table presents by class the TDRs that were restructured during the three months ended March 31, 2018 and March 31, 2017 . Generally, the modifications were extensions of term, modifying the payment terms from principal and interest to interest only for an extended period, or reduction in interest rate. All TDRs are evaluated individually for allowance for loan loss purposes. For the Three Months Ended For the Three Months Ended Dollars in thousands Number of Modifications Pre-modification Recorded Investment Post-modification Recorded Investment Number of Modifications Pre-modification Recorded Investment Post-modification Recorded Investment Residential real estate Non-jumbo 1 $ 63 $ 63 4 $ 880 $ 880 Total 1 $ 63 $ 63 4 $ 880 $ 880 The following table presents defaults during the stated period of TDRs that were restructured during the past twelve months. For purposes of these tables, a default is considered as either the loan was past due 30 days or more at any time during the period, or the loan was fully or partially charged off during the period. For the Three Months Ended Dollars in thousands Number of Defaults Recorded Investment at Default Date Commercial real estate Non-owner occupied 1 $ 341 Construction and development Land & land development 1 438 Residential real estate Non-jumbo 1 64 Total 3 $ 843 The following tables detail the activity regarding TDRs by loan type, net of fees, for the three months ended March 31, 2018 , and the related allowance on TDRs. For the Three Months Ended March 31, 2018 Construction & Land Development Commercial Real Estate Residential Real Estate Dollars in thousands Land & Land Develop- ment Construc- tion Commer- cial Owner Occupied Non- Owner Occupied Non- jumbo Jumbo Home Equity Mortgage Warehouse Lines Con- sumer Other Total Troubled debt restructurings Balance January 1, 2018 $ 3,043 $ — $ 412 $ 9,545 $ 5,234 $ 5,195 $ 4,393 $ 523 $ — $ 18 $ — $ 28,363 Additions — — — — — 63 — — — — — 63 Charge-offs — — — — — — — — — — — — Net (paydowns) advances (75 ) — (270 ) (71 ) 244 (739 ) (39 ) — — (3 ) — (953 ) Transfer into foreclosed properties — — — — — — — — — — — — Refinance out of TDR status — — — — — — — — — — — — Balance, March 31, 2018 $ 2,968 $ — $ 142 $ 9,474 $ 5,478 $ 4,519 $ 4,354 $ 523 $ — $ 15 $ — $ 27,473 Allowance related to troubled debt restructurings $ 441 $ — $ — $ 124 $ 24 $ 192 $ 13 $ — $ — $ — $ — $ 794 The following table presents the recorded investment in construction and development, commercial, and commercial real estate loans which are generally evaluated based upon our internal risk ratings. Loan Risk Profile by Internal Risk Rating Construction and Development Commercial Real Estate Land and Land Development Construction Commercial Owner Occupied Non-Owner Occupied Mortgage Warehouse Lines Dollars in thousands 3/31/2018 12/31/2017 3/31/2018 12/31/2017 3/31/2018 12/31/2017 3/31/2018 12/31/2017 3/31/2018 12/31/2017 3/31/2018 12/31/2017 Pass $ 61,155 $ 60,850 $ 33,266 $ 33,412 $ 186,740 $ 186,941 $ 257,856 $ 242,702 $ 488,813 $ 474,522 $ 45,702 $ 30,757 OLEM (Special Mention) 706 1,397 61 — 2,146 2,267 3,483 3,534 1,698 2,221 — — Substandard 4,980 4,972 — — 700 773 3,736 3,966 7,934 8,159 — — Doubtful — — — — — — — — — — — — Loss — — — — — — — — — — — — Total $ 66,841 $ 67,219 $ 33,327 $ 33,412 $ 189,586 $ 189,981 $ 265,075 $ 250,202 $ 498,445 $ 484,902 $ 45,702 $ 30,757 The following table presents the recorded investment and payment activity in consumer, residential real estate, and home equity loans, which are generally evaluated based on the aging status of the loans. Performing Nonperforming Dollars in thousands 3/31/2018 12/31/2017 3/31/2018 12/31/2017 Residential real estate Non-jumbo $ 339,376 $ 347,183 $ 7,101 $ 6,918 Jumbo 67,169 62,267 — — Home Equity 83,027 83,316 355 712 Consumer 34,650 35,932 175 270 Other 12,578 13,238 — — Total $ 536,800 $ 541,936 $ 7,631 $ 7,900 |