| Loans and reserve for credit losses | Loans and reserve for credit losses The composition of the loan portfolio at September 30, 2016 and December 31, 2015 was as follows (dollars in thousands): September 30, 2016 December 31, 2015 Amount Percent Amount Percent Originated loans (a): Commercial real estate: Owner occupied $ 280,901 15.8 % $ 263,095 18.1 % Non-owner occupied 486,689 27.6 % 431,379 29.7 % Total commercial real estate loans 767,590 43.4 % 694,474 47.8 % Construction 168,558 9.6 % 119,723 8.2 % Residential real estate 406,374 23.1 % 237,084 16.3 % Commercial and industrial 378,700 21.5 % 363,335 25.0 % Consumer 41,502 2.4 % 38,362 2.7 % Total loans 1,762,724 100.0 % 1,452,978 100.0 % Less: Deferred loan fees (1,917 ) (1,419 ) Reserve for loan losses (25,238 ) (24,415 ) Loans, net $ 1,735,569 $ 1,427,144 Acquired loans (b): Commercial real estate: Owner occupied $ 95,102 31.8 % $ 45,236 19.3 % Non-owner occupied 102,088 34.2 % 95,183 40.5 % Total commercial real estate loans 197,190 66.0 % 140,419 59.8 % Construction 14,423 4.8 % 10,629 4.5 % Residential real estate 59,092 19.8 % 61,306 26.1 % Commercial and industrial 26,569 8.9 % 21,109 9.0 % Consumer 1,510 0.5 % 1,488 0.6 % Total loans $ 298,784 100.0 % $ 234,951 100.0 % Total loans: Commercial real estate: Owner occupied $ 376,003 18.1 % $ 308,331 18.3 % Non-owner occupied 588,777 28.6 % 526,562 31.2 % Total commercial real estate loans 964,780 46.7 % 834,893 49.5 % Construction 182,981 8.9 % 130,352 7.7 % Residential real estate 465,466 22.6 % 298,390 17.7 % Commercial and industrial 405,269 19.7 % 384,444 22.8 % Consumer 43,012 2.1 % 39,850 2.3 % Total loans 2,061,508 100.0 % 1,687,929 100.0 % Less: Deferred loan fees (1,917 ) (1,419 ) Reserve for loan losses (25,238 ) (24,415 ) Loans, net $ 2,034,353 $ 1,662,095 (a) Loans organically made through the Company’s normal and customary origination process, including adjustable rate mortgage (“ARM”) purchases. (b) Loans acquired in the acquisition of Home and PPFS. The following describes the distinction between originated and acquired loan portfolios and certain significant accounting policies relevant to each of these portfolios. Originated loans Loans originated for investment are stated at their principal amount outstanding adjusted for partial charge-offs, the reserve for loan losses and net deferred loan fees and costs. Interest income on loans is accrued over the term of the loans. Interest is not accrued on loans where collectability is uncertain. Accrued interest on loans is presented in “Other assets” on the condensed consolidated balance sheet. Loan origination fees and certain direct costs incurred to extend credit are deferred and amortized over the term of the loan as an adjustment to the related loan yield. Approximately 76.1% of the Bank’s originated loan portfolio at September 30, 2016 consisted of real estate-related loans, including construction and development loans, residential mortgage loans, and commercial loans secured by commercial real estate. At September 30, 2016 , approximately 78.2% of the Bank’s total portfolio (inclusive of acquired loans) consisted of real estate-related loans as described above. The Bank’s results of operations and financial condition are affected by general economic trends and in particular, the strength of the local residential and commercial real estate markets in Central, Southern and Northwest Oregon, as well as the greater Boise/Treasure Valley, Idaho and Seattle, Washington metro areas. Real estate values could be affected by, among other things, a worsening of national and local economic conditions, an increase in foreclosures, a decline in home sale volumes, and an increase in interest rates. Furthermore, the Bank may experience an increase in the number of borrowers who become delinquent, file for protection under bankruptcy laws, or default on their loans or other obligations to the Bank in the event of a sustained downturn in business and economic conditions generally or specifically in the principal markets in which the Bank does business. An increase in the number of delinquencies, bankruptcies, or defaults could result in a higher level of non-performing assets, net charge-offs, and loan loss provision. Management expects to diversify its commercial real estate (“CRE”) concentration over time, but real estate-related loans will remain a significant portfolio component due to the nature of the economies, businesses, and markets the Bank serves. In the normal course of business, the Bank may participate portions of loans to third parties in order to extend the Bank’s lending capability or to mitigate risk. At September 30, 2016 and December 31, 2015 , the portion of loans participated to third parties (which are not included in the accompanying condensed consolidated financial statements) totaled $50.7 million and $44.2 million , respectively. Acquired loans PPFS Acquired loans include those loans purchased by the Company in its acquisition of PPFS, which was completed on August 1, 2016 . These loans were recorded at estimated fair value at the PPFS Acquisition Date. The fair value estimates for acquired loans are based on expected prepayments, charge-offs and the amount and timing of undiscounted expected principal, interest and other cash flows. The net fair value adjustment to the PPFS acquired loans at acquisition was a reduction of $2.3 million , representing a valuation adjustment for interest rate and credit which will be accreted over the life of the loans (approximately 10 years). As of September 30, 2016 , the remaining net fair value adjustment to the PPFS acquired loans was $2.3 million . Home Acquired loans also include those loans purchased by the Company in its acquisition of Home Federal Bancorp, Inc. (“Home”), which was completed on May 16, 2014 (the “Home Acquisition Date”). These loans were recorded at estimated fair value at the Home Acquisition Date. The fair value estimates for acquired loans are based on expected prepayments, charge-offs and the amount and timing of undiscounted expected principal, interest and other cash flows. The net fair value adjustment to the Home acquired loans at acquisition was a reduction of $ 6.0 million , representing a valuation adjustment for interest rate and credit which will be accreted over the life of the loans (approximately 10 years). As of September 30, 2016 , the remaining net fair value adjustment was $1.9 million . Of the PPFS and Home loans acquired on the PPFS Acquisition Date and Home Acquisition Date, as applicable, and still held at September 30, 2016 , $9.8 million , or 3.3% , were graded substandard. With the amount of classified loans acquired being nominal, all loans acquired are treated in a manner consistent with originated loans for credit risk management and accounting purposes. As of September 30, 2016 , $22.3 million , or 7.5% of the $ 298.8 million in acquired loans were covered under loss sharing agreements with the FDIC (“covered loans”) that were entered into in September 2009 and September 2010 between the FDIC and Home. The loss sharing agreements have limited terms ( 10 years for net losses on single-family residential real estate loans, as defined by the FDIC, five years for losses on non-residential real estate loans, as defined by the FDIC, and an additional three years with respect to recoveries on non-residential real estate loans). After the expiration of the loss sharing agreements, the Company will not be indemnified for losses and related expenses on covered loans. When the loss sharing agreements expire, the Company’s and the Bank’s risk-based capital ratios will be reduced. While the agreements are in place, the covered loans receive a 20% risk-weighting. When the agreements expire, the risk-weighting for previously covered loans will most likely increase to 100% , based on current regulatory capital definitions. Nearly all of the assets remaining in the covered loans portfolio are non-single family covered loans. Therefore, most of the covered loans were no longer indemnified after September 30, 2014 or were no longer indemnified after September 30, 2015. With the amount of classified loans covered under these agreements being nominal, amounts that may be due to or due from the FDIC under loss sharing agreements will be accounted for on a cash basis. A net loss share payable was recorded at the Home Acquisition Date that represents the estimated value of reimbursement the Company expects to pay to the FDIC for recoveries net of incurred losses on covered loans. These expected reimbursements are recorded as part of covered loans in the accompanying consolidated balance sheets. Upon the determination of an incurred loss or recovery, the loss share receivable/payable will be changed by the amount due to or due from the FDIC. Changes in the loss share payable associated with cov ered loans for the three and nine months ended September 30, 2016 were as follows (dollars in thousands) : Three months ended Nine months ended September 30, 2016 Balance at beginning of period $ 201 $ 289 Paid to FDIC (201 ) (857 ) Increase due to impairment — (53 ) FDIC reimbursement 396 1,077 Shared loss expenses (28 ) (92 ) Adjustments from prior periods — 4 Balance at end of period $ 368 $ 368 Reserve for loan losses The reserve for loan losses represents management’s estimate of known and inherent losses in the loan portfolio as of the condensed consolidated balance sheet date and is recorded as a reduction to loans. The reserve for loan losses is increased by charges to operating expense through the loan loss provision, and decreased by loans charged-off, net of recoveries. The reserve for loan losses requires complex subjective judgments as a result of the need to make estimates about matters that are uncertain. The reserve for loan losses is maintained at a level currently considered adequate to provide for potential loan losses based on management’s assessment of various factors affecting the loan portfolio. However, the reserve for loan losses is based on estimates and actual losses may vary from the current estimates. These estimates are reviewed periodically, and, as adjustments become necessary, they are reported in earnings in the periods in which they become known. Therefore, management cannot provide assurance that, in any particular period, the Company will not have significant losses in relation to the amount reserved. The level of the reserve for loan losses is also determined after consideration of bank regulatory guidance and recommendations and is subject to review by such regulatory authorities who may require increases or decreases to the reserve based on their evaluation of the information available to them at the time of their examinations of the Bank. For purposes of assessing the appropriate level of the reserve for loan losses, the Company analyzes loans and commitments to loan, and the amount of reserves allocated to loans and commitments to loan in each of the following reserve categories: pooled reserves, specifically identified reserves for impaired loans, and the unallocated reserve. Also, for purposes of analyzing loan portfolio credit quality and determining the appropriate level of reserve for loan losses, the Company identifies loan portfolio segments and classes based on the nature of the underlying loan collateral. Risk ratings for individual shared national credits (“SNC”) are estimated using analysis of both public debt ratings and internal ratings. Expected loss rates are determined based upon historical published specific loss data for similar loans based on average losses and losses stratified by public debt ratings. Public ratings combined with internal risk rates are used to determine a minimum historical loss factor for each SNC loan. This amount may be increased for qualitative conditions including macroeconomic environment and observations by the Company’s SNC management group. The SNC lending strategy is intended to diversify the Company’s credit risk profile geographically and by industry. Additionally, such loans enhance the Company’s interest rate risk profile as they float with LIBOR rates. The increase in the reserve for loan losses from December 31, 2015 to September 30, 2016 was related to net recoveries and loan portfolio growth during the period. Management believes the amount of ALLL is appropriate as of September 30, 2016 . The unallocated reserve for loan losses at September 30, 2016 has decreased $ 0.6 million from the balance at December 31, 2015 . Management believes that the amount of unallocated reserve for loan losses is appropriate and will continue to evaluate the amount going forward. Acquired reserve for loan losses The fair value estimates for acquired loans are based on expected prepayments, charge-offs, and the amount and timing of undiscounted expected principal, interest and other cash flows. The net fair value adjustment to the acquired loans was $ 6.0 million and $2.3 million for Home and PPFS, respectively, at the time of acquisition representing a valuation adjustment for interest rate and credit quality. The credit portion of the fair value adjustment not accreted at any point in time represents the estimated reserve for loan losses for acquired loans. If the Company determines that this amount is insufficient, a provision to the reserve for loan losses will be made. As of September 30, 2016 , the remaining net fair value adjustment was $1.9 million and $2.3 million for Home and PPFS, respectively, and no additional reserve for acquired loans was required. Transactions and allocations in the reserve for loan losses and unfunded loan commitments, by portfolio segment, for the three and nine months ended September 30, 2016 and 2015 were as follows (dollars in thousands): Commercial Construction Residential Commercial Consumer Unallocated Total For the three months ended September 30, 2016 Allowance for Loan Losses Balance at June 30, 2016 $ 4,391 $ 1,259 $ 2,674 $ 11,982 $ 978 $ 3,382 $ 24,666 Loan loss provision (credit) 1,554 271 1,044 (1,766 ) 441 (1,544 ) — Recoveries 74 327 45 428 208 — 1,082 Loans charged off — — — (95 ) (415 ) — (510 ) Balance at end of period $ 6,019 $ 1,857 $ 3,763 $ 10,549 $ 1,212 $ 1,838 $ 25,238 Reserve for unfunded lending commitments Balance at June 30, 2016 $ 48 $ 268 $ 25 $ 75 $ 24 $ — $ 440 Provision for unfunded loan commitments — — — — — — — Balance at end of period $ 48 $ 268 $ 25 $ 75 $ 24 $ — $ 440 Reserve for credit losses Reserve for loan losses $ 6,019 $ 1,857 $ 3,763 $ 10,549 $ 1,212 $ 1,838 $ 25,238 Reserve for unfunded lending commitments 48 268 25 75 24 — 440 Total reserve for credit losses $ 6,067 $ 2,125 $ 3,788 $ 10,624 $ 1,236 $ 1,838 $ 25,678 Commercial Construction Residential Commercial Consumer Unallocated Total For the nine months ended September 30, 2016 Allowance for Loan Losses Balance at December 31, 2015 $ 3,934 $ 1,044 $ 2,075 $ 13,969 $ 917 $ 2,476 $ 24,415 Loan loss provision (credit) (667 ) 407 1,530 (1,554 ) 922 (638 ) — Recoveries 2,792 406 222 1,190 715 — 5,325 Loans charged off (40 ) — (64 ) (3,056 ) (1,342 ) — (4,502 ) Balance at end of period $ 6,019 $ 1,857 $ 3,763 $ 10,549 $ 1,212 $ 1,838 $ 25,238 Reserve for unfunded lending commitments Balance at December 31, 2015 $ 48 $ 268 $ 25 $ 75 $ 24 $ — $ 440 Provision for unfunded loan commitments — — — — — — — Balance at end of period $ 48 $ 268 $ 25 $ 75 $ 24 $ — $ 440 Reserve for credit losses Reserve for loan losses $ 6,019 $ 1,857 $ 3,763 $ 10,549 $ 1,212 $ 1,838 $ 25,238 Reserve for unfunded lending commitments 48 268 25 75 24 — 440 Total reserve for credit losses $ 6,067 $ 2,125 $ 3,788 $ 10,624 $ 1,236 $ 1,838 $ 25,678 Commercial Construction Residential Commercial Consumer Unallocated Total For the three months ended September 30, 2015 Allowance for Loan Losses Balance at June 30, 2015 $ 5,032 $ 1,356 $ 2,463 $ 11,355 $ 1,001 $ 2,294 $ 23,501 Loan loss provision (credit) (490 ) (293 ) (162 ) (2,245 ) 99 3,091 — Recoveries 408 155 162 2,885 179 — 3,789 Loans charged off — — (50 ) (293 ) (324 ) — (667 ) Balance at end of period $ 4,950 $ 1,218 $ 2,413 $ 11,702 $ 955 $ 5,385 $ 26,623 Reserve for unfunded lending commitments Balance at June 30, 2015 $ 48 $ 268 $ 25 $ 75 $ 24 $ — $ 440 Provision for unfunded loan commitments — — — — — — — Balance at end of period $ 48 $ 268 $ 25 $ 75 $ 24 $ — $ 440 Reserve for credit losses Reserve for loan losses $ 4,950 $ 1,218 $ 2,413 $ 11,702 $ 955 $ 5,385 $ 26,623 Reserve for unfunded lending commitments 48 268 25 75 24 — 440 Total reserve for credit losses $ 4,998 $ 1,486 $ 2,438 $ 11,777 $ 979 $ 5,385 $ 27,063 Commercial Construction Residential Commercial Consumer Unallocated Total For the nine months ended September 30, 2015 Allowance for Loan Losses Balance at December 31, 2014 $ 5,614 $ 1,133 $ 2,121 $ 6,844 $ 1,047 $ 5,294 $ 22,053 Loan loss provision (credit) (4,397 ) (193 ) (60 ) 2,024 535 91 (2,000 ) Recoveries 4,011 278 746 3,440 457 — 8,932 Loans charged off (278 ) — (394 ) (606 ) (1,084 ) — (2,362 ) Balance at end of period $ 4,950 $ 1,218 $ 2,413 $ 11,702 $ 955 $ 5,385 $ 26,623 Reserve for unfunded lending commitments Balance at December 31, 2014 $ 48 $ 268 $ 25 $ 75 $ 24 $ — $ 440 Provision for unfunded loan commitments — — — — — — — Balance at end of period $ 48 $ 268 $ 25 $ 75 $ 24 $ — $ 440 Reserve for credit losses Reserve for loan losses $ 4,950 $ 1,218 $ 2,413 $ 11,702 $ 955 $ 5,385 $ 26,623 Reserve for unfunded lending commitments 48 268 25 75 24 — 440 Total reserve for credit losses $ 4,998 $ 1,486 $ 2,438 $ 11,777 $ 979 $ 5,385 $ 27,063 An individual loan is impaired when, based on current information and events, management believes that it is probable that the Bank will be unable to collect all amounts due according to the contractual terms of the loan agreement. The following table presents the reserve for loan losses and the recorded investment in loans by portfolio segment and impairment evaluation method at September 30, 2016 and December 31, 2015 (dollars in thousands): Reserve for loan losses Recorded investment in loans Individually Collectively Total Individually Collectively Total September 30, 2016 Commercial real estate $ 74 $ 5,945 $ 6,019 $ 4,329 $ 960,451 $ 964,780 Construction — 1,857 1,857 — 182,981 182,981 Residential real estate — 3,763 3,763 — 465,466 465,466 Commercial and industrial 25 10,524 10,549 7,471 397,798 405,269 Consumer — 1,212 1,212 — 43,012 43,012 $ 99 $ 23,301 23,400 $ 11,800 $ 2,049,708 $ 2,061,508 Unallocated 1,838 $ 25,238 December 31, 2015 Commercial real estate $ 78 $ 3,856 $ 3,934 $ 3,835 $ 831,058 $ 834,893 Construction — 1,044 1,044 365 129,987 130,352 Residential real estate — 2,075 2,075 18 298,372 298,390 Commercial and industrial 164 13,805 13,969 2,724 381,720 384,444 Consumer — 917 917 — 39,850 39,850 $ 242 $ 21,697 21,939 $ 6,942 $ 1,680,987 $ 1,687,929 Unallocated 2,476 $ 24,415 The above reserve for loan losses includes an unallocated allowance of $ 1.8 million at September 30, 2016 and $ 2.5 million at December 31, 2015 . The change in the unallocated allowance is due to the increase in qualitative factors impacting the reserve, partially offset by net recoveries. The Company uses credit risk ratings, which reflect the Bank’s assessment of a loan’s risk or loss potential, for purposes of assessing the appropriate level of reserve for loan losses. The Bank’s credit risk rating definitions along with applicable borrower characteristics for each credit risk rating are as follows: Acceptable The borrower is a reasonable credit risk and demonstrates the ability to repay the loan from normal business operations. Loans are generally made to companies operating in an economy and/or industry that is generally sound. The borrower tends to operate in regional or local markets and has achieved sufficient revenues for the business to be financially viable. The borrowers financial performance has been consistent in normal economic times and has been average or better than average for its industry. A loan can also be considered Acceptable even though the borrower may have some vulnerability to downturns in the economy due to marginally satisfactory working capital and debt service cushion. Availability of alternate financing sources may be limited or nonexistent. In some cases, the borrower’s management may have limited depth or continuity but is still considered capable. An adequate primary source of repayment is identified while secondary sources may be illiquid, more speculative, less readily identified, or reliant upon collateral liquidation. Loan agreements will be well defined, including several financial performance covenants and detailed operating covenants. This category also includes commercial loans to individuals with average or better than average capacity to repay. Pass-Watch Loans are graded Pass-Watch when temporary situations increase the level of the Bank’s risk associated with the loan, and remain graded Pass-Watch until the situation has been corrected. These situations may involve one or more weaknesses in cash flow, collateral value or indebtedness that could, if not corrected within a reasonable period of time, jeopardize the full repayment of the debt. In general, loans in this category remain adequately protected by the borrower’s net worth and paying capacity, or pledged collateral. Special Mention A Special Mention credit has potential weaknesses that may, if not checked or corrected, weaken the loan or leave the Bank inadequately protected at some future date. Loans in this category are deemed by management of the Bank to be currently protected but reflect potential problems that warrant more than the usual management attention but do not justify a Substandard classification. Substandard Substandard loans are those inadequately protected by the net worth and paying capacity of the obligor and/or by the value of the pledged collateral, if any. Substandard loans have a high probability of payment default or they have other well-defined weaknesses. They require more intensive supervision and borrowers are generally characterized by current or expected unprofitable operations, inadequate debt service coverage, inadequate liquidity, or marginal capitalization. Repayment may depend on collateral or other credit risk mitigants. CRE and construction loans are classified Substandard when well-defined weaknesses are present which jeopardize the orderly liquidation of the loan. Well-defined weaknesses include a project’s lack of marketability, inadequate cash flow or collateral support, failure to complete construction on time, and/or the project’s failure to fulfill economic expectations. These loans are characterized by the distinct possibility that the Bank will sustain some loss if the deficiencies are not corrected. Substandard loans also include impaired loans. Impaired loans bear the characteristics of Substandard loans as described above, and the Company has determined it does not expect timely payment of all contractually due interest and principal. Impaired loans may be adequately secured by collateral. During the nine months ended September 30, 2016 , the Bank saw relatively steady credit quality metrics. An improvement in Special Mention loans was partially offset by an increase in the Substandard portfolio. Increases in the Substandard loan balances were largely due to certain energy/mining sector SNCs included in commercial and industrial (“C&I”) loans. Aggregate portfolio exposure to the energy/mining sector is less than 1% of total loans outstanding. The following table presents, by portfolio class, the recorded investment in loans by internally assigned grades at September 30, 2016 and December 31, 2015 (dollars in thousands): Loan grades Acceptable Pass-Watch Special Mention Substandard Total September 30, 2016 Originated loans (a): Commercial real estate: Owner occupied $ 266,610 $ 6,811 $ 1,091 $ 6,389 $ 280,901 Non-owner occupied 479,207 1,589 4,520 1,373 486,689 Total commercial real estate loans 745,817 8,400 5,611 7,762 767,590 Construction 168,558 — — — 168,558 Residential real estate 405,923 — — 451 406,374 Commercial and industrial 340,082 10,274 5,173 23,171 378,700 Consumer 41,476 — — 26 41,502 $ 1,701,856 $ 18,674 $ 10,784 $ 31,410 $ 1,762,724 Acquired loans (b): Commercial real estate: Owner occupied $ 89,484 $ 2,441 $ 1,563 $ 1,614 $ 95,102 Non-owner occupied 82,873 3,851 8,995 6,369 102,088 Total commercial real estate loans 172,357 6,292 10,558 7,983 197,190 Construction 14,363 — — 60 14,423 Residential real estate 56,461 1,550 — 1,081 59,092 Commercial and industrial 24,750 557 588 674 26,569 Consumer 1,510 — — — 1,510 $ 269,441 $ 8,399 $ 11,146 $ 9,798 $ 298,784 Total loans: Commercial real estate: Owner occupied $ 356,094 $ 9,252 $ 2,654 $ 8,003 $ 376,003 Non-owner occupied 562,080 5,440 13,515 7,742 588,777 Total commercial real estate loans 918,174 14,692 16,169 15,745 964,780 Construction 182,921 — — 60 182,981 Residential real estate 462,384 1,550 — 1,532 465,466 Commercial and industrial 364,832 10,831 5,761 23,845 405,269 Consumer 42,986 — — 26 43,012 $ 1,971,297 $ 27,073 $ 21,930 $ 41,208 $ 2,061,508 (a) Loans organically made through the Company’s normal and customary origination process, including ARM purchases. (b) Loans acquired in the acquisition of Home and PPFS. Loan grades Acceptable Pass-Watch Special Substandard Total December 31, 2015 Originated loans (a): Commercial real estate: Owner occupied $ 243,113 $ 8,623 $ 1,426 $ 9,933 $ 263,095 Non-owner occupied 411,137 9,825 4,522 5,895 431,379 Total commercial real estate loans 654,250 18,448 5,948 15,828 694,474 Construction 118,752 — 971 — 119,723 Residential real estate 236,574 — — 510 237,084 Commercial and industrial 328,934 11,220 13,729 9,452 363,335 Consumer 38,350 — — 12 38,362 $ 1,376,860 $ 29,668 $ 20,648 $ 25,802 $ 1,452,978 Acquired loans (b): Commercial real estate: Owner occupied $ 34,081 $ 3,480 $ 7,341 $ 334 $ 45,236 Non-owner occupied 71,334 2,751 9,386 11,712 95,183 Total commercial real estate loans 105,415 6,231 16,727 12,046 140,419 Construction 10,597 — — 32 10,629 Residential real estate 60,151 — — 1,155 61,306 Commercial and industrial 17,034 153 3,461 461 21,109 Consumer 1,485 — — 3 1,488 $ 194,682 $ 6,384 $ 20,188 $ 13,697 $ 234,951 Total loans: Commercial real estate: Owner occupied $ 277,194 $ 12,103 $ 8,767 $ 10,267 $ 308,331 Non-owner occupied 482,471 12,576 13,908 17,607 526,562 Total commercial real estate loans 759,665 24,679 22,675 27,874 834,893 Construction 129,349 — 971 32 130,352 Residential real estate 296,725 — — 1,665 298,390 Commercial and industrial 345,968 11,373 17,190 9,913 384,444 Consumer 39,835 — — 15 39,850 $ 1,571,542 $ 36,052 $ 40,836 $ 39,499 $ 1,687,929 (a) Loans organically made through the Company’s normal and customary origination process, including ARM purchases. (b) Loans acquired in the acquisition of Home and PPFS. The following table presents, by portfolio class, an age analysis of past due loans, including loans placed on non-accrual at September 30, 2016 and December 31, 2015 (dollars in thousands): 30-89 days past due 90 days or more past due Total past due Current Total loans September 30, 2016 Originated loans (a): Commercial real estate: Owner occupied $ 207 $ 490 $ 697 $ 280,204 $ 280,901 Non-owner occupied — — — 486,689 486,689 Total commercial real estate loans 207 490 697 766,893 767,590 Construction — — — 168,558 168,558 Residential real estate 2,625 — 2,625 403,749 406,374 Commercial and industrial 156 171 327 378,373 378,700 Consumer 203 26 229 41,273 41,502 $ 3,191 $ 687 $ 3,878 $ 1,758,846 $ 1,762,724 Acquired loans (b): Commercial real estate: Owner occupied $ 11 $ — $ 11 $ 95,091 $ 95,102 Non-owner occupied — — — 102,088 102,088 Total commercial real estate loans 11 — 11 197,179 197,190 Construction — 21 21 14,402 14,423 Residential real estate 1,172 586 1,758 57,334 59,092 Commercial and industrial 225 8 233 26,336 26,569 Consumer 28 — 28 1,482 1,510 $ 1,436 $ 615 $ 2,051 $ 296,733 $ 298,784 Total loans: Commercial real estate: Owner occupied $ 218 $ 490 $ 708 $ 375,295 $ 376,003 Non-owner occupied — — — 588,777 588,777 Total commercial real estate loans 218 490 708 964,072 964,780 Construction — 21 21 182,960 182,981 Residential real estate 3,797 586 4,383 461,083 465,466 Commercial and industrial 381 179 560 404,709 405,269 Consumer 231 26 257 42,755 43,012 $ 4,627 $ 1,302 $ 5,929 $ 2,055,579 $ 2,061,508 December 31, 2015 Originated loans (a): Commercial real estate: Owner occupied $ 1,020 $ 719 $ 1,739 $ 261,356 $ 263,095 Non-owner occupied 593 — 593 430,786 431,379 Total commercial real estate loans 1,613 719 2,332 692,142 694,474 Construction — — — 119,723 119,723 Residential real estate 196 — 196 236,888 237,084 Commercial and industrial 346 239 585 362,750 363,335 Consumer 209 12 221 38,141 38,362 $ 2,364 $ 970 $ 3,334 $ 1,449,644 $ 1,452,978 Acquired loans (b): Commercial real estate: Owner occupied $ — $ — $ — $ 45,236 $ 45,236 Non-owner occupied 2,049 — 2,049 93,134 95,183 Total commercial real estate loans 2,049 — 2,049 138,370 140,419 Construction 46 — 46 10,583 10,629 Residential real estate 748 534 1,282 60,024 61,306 Commercial and industrial 6 5 11 21,098 21,109 Consumer 53 — 53 1,435 1,488 $ 2,902 $ 539 $ 3,441 $ 231,510 $ 234,951 Total loans: Commercial real estate: Owner occupied $ 1,020 $ 719 $ 1,739 $ 306,592 $ 308,331 Non-owner occupied 2,642 — 2,642 523,920 526,562 Total commercial real estate loans 3,662 719 4,381 830,512 834,893 Construction 46 — 46 130,306 130,352 Residential real estate 944 534 1,478 296,912 298,390 Commercial and industrial 352 244 596 383,848 384,444 Consumer 262 12 274 39,576 39,850 $ 5,266 $ 1,509 $ 6,775 $ 1,681,154 $ 1,687,929 (a) Loans organically made through the Company’s normal and customary origination process, including ARM purchases. (b) Loans acquired in the acquisition of Home and PPFS. Loans contractually past due 90 days or more on which the Company continued to accrue interest were $0.06 million and $0.07 million at September 30, 2016 and December 31, 2015 , respectively. The following table presents information related to impaired loans, by portfolio class, at September 30, 2016 and December 31, 2015 (dollars in thousands): Impaired loans With a related allowance Without a related allowance Total recorded balance Unpaid principal balance Related allowance September 30, 2016 Commercial real estate: Owner occupied $ 815 $ 1,004 $ 1,819 $ 2,437 $ 54 Non-owner occupied 632 1,878 2,510 2,511 20 Total commercial real estate loans 1,447 2,882 4,329 4,948 74 Construction — — — — — Residential real estate — — — — — Commercial and industrial 76 7,395 7,471 11,119 25 Consumer — — — — — $ 1,523 $ 10,277 $ 11,800 $ 16,067 $ 99 December 31, 2015 Commercial real estate: Owner occupied $ 1,032 $ 2,157 $ 3,189 $ 4,285 $ 73 Non-owner occupied 646 — 646 646 5 Total commercial real estate loans 1,678 2,157 3,835 4,931 78 Construction — 365 365 365 — Residential real estate — 18 18 18 — Commercial and industrial 2,539 185 2,724 3,366 164 Consumer — — — — — $ 4,217 $ 2,725 $ 6,942 $ 8,680 $ 242 The increase in impaired C&I loans relates to energy/mining SNCs. Aggregate portfolio exposure to the energy/mining sector is less than 1% of total loans outstanding. At September 30, 2016 and December 31, 2015 , the total recorded balance of impaired loans in the above table included $0.6 million and $0.8 million , respectively, of troubled debt restructuring (“TDR”) loans which were not on non-accrual status. The following table presents, by portfolio class, the average recorded investment in impaired loans for the three and nine months ended September 30, 2016 and 2015 (dollars in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2016 2015 2016 2015 Commercial real estate: Owner occupied $ 1,912 $ 3,063 $ 2,129 $ 3,225 Non-owner occupied 2,525 1,072 2,540 8,297 Total commercial real estate loans 4,437 4,135 4,669 11,522 Construction — 443 — 543 Residential real estate — 28 — 66 Commercial and industrial 7,462 2,712 7,534 2,815 Consumer — — — — $ 11,899 $ 7,318 $ 12,203 $ 14,946 Interest income recognized for cash payments received on impaired loans for the three and nine months ended September 30, 2016 was $0.5 million and $1.1 million , respectively. Information with respect to the Company’s non-performing loans, by portfolio class, at September 30, 2016 and December 31, 2015 is as follows (dollars in thousands): September 30, 2016 December 31, 2015 Commercial real estate: Owner occupied $ 1,353 $ 2,742 Non-owner occupied 2,711 434 Total commercial real estate loans 4,06 |
