Heritage Oaks Bancorp (HEOP) 10-Q 30 Oct 15 2015 Q3 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	9 Months Ended
	Sep. 30, 2015	Oct. 28, 2015
Document and Entity Information
Entity Registrant Name	HERITAGE OAKS BANCORP
Entity Central Index Key	921,547
Document Type	10-Q
Document Period End Date	Sep. 30, 2015
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Current Reporting Status	Yes
Entity Filer Category	Accelerated Filer
Entity Common Stock, Shares Outstanding		34,356,179
Document Fiscal Year Focus	2,015
Document Fiscal Period Focus	Q3

Condensed Consolidated Balance

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Sep. 30, 2015	Dec. 31, 2014
Assets
Cash and due from banks	$ 22,469	$ 12,548
Interest earning deposits in other banks	89,801	23,032
Total cash and cash equivalents	112,270	35,580
Investment securities available for sale, at fair value	432,750	355,580
Loans held for sale, at lower of cost or fair value	5,366	2,586
Gross loans held for investment	1,206,740	1,193,483
Net deferred loan fees	(1,056)	(1,445)
Allowance for loan and lease losses	(17,296)	(16,802)
Net loans held for investment	1,188,388	1,175,236
Premises and equipment, net	37,686	37,820
Premises held for sale	1,910	1,978
Bank-owned life insurance	25,191	24,711
Goodwill	24,885	24,885
Deferred tax assets, net	21,422	24,920
Federal Home Loan Bank stock	7,853	7,853
Other intangible assets	4,560	5,347
Other assets	11,644	13,631
Total assets	1,873,925	1,710,127
Liabilities
Non-interest bearing deposits	544,782	461,479
Interest bearing deposits	1,026,988	933,325
Total deposits	1,571,770	1,394,804
Short term FHLB borrowing	13,500	25,000
Long term FHLB borrowing	65,046	70,558
Junior subordinated debentures	10,389	13,233
Other liabilities	7,762	8,592
Total liabilities	1,668,467	1,512,187
Shareholders' Equity
Preferred stock, 5,000,000 shares authorized: Series C preferred stock, $3.25 per share stated value; issued and outstanding: 0 shares and 348,697 shares at September 30, 2015, and December 31, 2014, respectively.		1,056
Common stock, no par value; authorized: 100,000,000 shares; issued and outstanding: 34,352,445 shares and 33,905,060 shares at September 30, 2015 and December 31, 2014, respectively.	165,452	164,196
Additional paid in capital	7,964	6,984
Retained earnings	30,774	24,772
Accumulated other comprehensive income, net of tax of $920 and $677 as of September 30, 2015 and December 31, 2014, respectively.	1,268	932
Total shareholders' equity	205,458	197,940
Total liabilities and shareholders' equity	$ 1,873,925	$ 1,710,127

Condensed Consolidated Balance3

Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands	9 Months Ended	12 Months Ended
	Sep. 30, 2015	Dec. 31, 2014
Preferred stock
Preferred stock, shares authorized	5,000,000	5,000,000
Common stock
Common stock, no par value (in dollars per share)	$ 0	$ 0
Common stock, shares authorized	100,000,000	100,000,000
Common stock, shares issued	34,352,445	33,905,060
Common stock, shares outstanding	34,352,445	33,905,060
Accumulated other comprehensive loss, tax expense (in dollars)	$ 920	$ 677
Series C preferred stock
Preferred stock
Preferred stock, per share stated value (in dollars per share)	$ 3.25	$ 3.25
Preferred stock, shares issued	0	348,697
Preferred stock, shares outstanding	0	348,697

Condensed Consolidated Statemen

Condensed Consolidated Statements of Income - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014
Interest Income
Loans, including fees	$ 14,781	$ 14,745	$ 44,454	$ 41,134
Investment securities	1,864	1,946	5,193	5,355
Other interest-earning assets	312	204	979	535
Total interest income	16,957	16,895	50,626	47,024
Interest Expense
Deposits	941	918	2,748	2,661
Other borrowings	620	406	1,742	1,158
Total interest expense	1,561	1,324	4,490	3,819
Net interest income before provision for loan losses	15,396	15,571	46,136	43,205
Net interest income after provision for loan and lease losses	15,396	15,571	46,136	43,205
Non-Interest Income
Fees and service charges	1,219	1,410	3,639	3,949
Gain on extinguishment of debt	552		552
Net gain on sale of mortgage loans	407	411	1,277	967
Gain on sale of investment securities	136	450	641	549
Other mortgage fee income	92	64	348	223
Other income	400	647	1,621	1,533
Total non-interest income	2,806	2,982	8,078	7,221
Non-Interest Expense
Salaries and employee benefits	5,598	6,164	17,643	18,121
Professional services	1,688	1,776	5,023	4,989
Occupancy and equipment	2,234	1,839	5,342	3,610
Information technology	611	756	1,753	2,403
Regulatory assessments	298	351	895	862
Amortization of intangible assets	263	297	787	760
Loan department expense	252	239	798	700
Sales and marketing	240	232	852	595
Communication costs	150	183	435	450
Merger, restructure and integration	(97)	748	(67)	8,785
Other expense	914	797	1,932	2,132
Total non-interest expense	12,151	13,382	35,393	43,407
Income before income taxes	6,051	5,171	18,821	7,019
Income tax expense	2,049	1,742	6,950	2,406
Net income	4,002	3,429	11,871	4,613
Dividends and accretion on preferred stock			70
Net income available to common shareholders	$ 4,002	$ 3,429	$ 11,801	$ 4,613
Earnings Per Common Share
Basic (in dollars per share)	$ 0.12	$ 0.10	$ 0.35	$ 0.14
Diluted (in dollars per share)	0.12	0.10	0.34	0.14
Dividends Declared Per Common Share (in dollars per share)	$ 0.06	$ 0.03	$ 0.17	$ 0.03

Condensed Consolidated Stateme5

Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014
Condensed Consolidated Statements of Comprehensive Income
Net income	$ 4,002	$ 3,429	$ 11,871	$ 4,613
Other comprehensive income, net of tax:
Unrealized holding gains on securities arising during the period	1,963	983	1,220	6,206
Reclassification for net gains on investments included in net income	(136)	(450)	(641)	(549)
Other comprehensive income, before income tax expense	1,827	533	579	5,657
Income tax expense related to items of other comprehensive income	768	217	243	2,326
Other comprehensive income	1,059	316	336	3,331
Comprehensive income	$ 5,061	$ 3,745	$ 12,207	$ 7,944

Condensed Consolidated Stateme6

Condensed Consolidated Statements of Shareholders' Equity - USD ($) $ in Thousands	Preferred Stock	Common Stock	Additional Paid-In Capital	Retained Earnings	Accumulated Other Comprehensive (Loss) Income	Total
Balance at Dec. 31, 2013	$ 3,604	$ 101,511	$ 6,020	$ 18,717	$ (3,425)	$ 126,427
Balance (in shares) at Dec. 31, 2013		25,397,780
Increase (Decrease) in Stockholders' Equity
Issuance of common stock in MISN Transaction		$ 60,255				60,255
Issuance of common stock in MISN Transaction (in shares)		7,541,326
Stock issuance costs			(381)			(381)
Dividends declared ($0.17 and $0.03 per share for period ended September 30, 2015 and 2014 respectively)				(1,027)		(1,027)
Exercise of stock options		$ 158				158
Exercise of stock options (in shares)		44,217
Share-based compensation			723			723
Tax benefit of share-based compensation			20			20
Net issuance of restricted share awards (in shares)		98,882
Net income				4,613		4,613
Other comprehensive income					3,331	3,331
Balance at Sep. 30, 2014	3,604	$ 161,924	6,382	22,303	(94)	$ 194,119
Balance (in shares) at Sep. 30, 2014		33,082,205
Increase (Decrease) in Stockholders' Equity
Repurchases of common stock (in shares)						(55,428)
Balance at Sep. 30, 2015		$ 165,452	7,964	30,774	1,268	$ 205,458
Balance (in shares) at Sep. 30, 2015		34,352,445
Balance at Dec. 31, 2014	1,056	$ 164,196	6,984	24,772	932	197,940
Balance (in shares) at Dec. 31, 2014		33,905,060
Increase (Decrease) in Stockholders' Equity
Dividends declared ($0.17 and $0.03 per share for period ended September 30, 2015 and 2014 respectively)				(5,799)		(5,799)
Repurchases of common stock		$ (28)				$ (28)
Repurchases of common stock (in shares)		(3,696)				(3,696)
Exercise of stock options		$ 228				$ 228
Exercise of stock options (in shares)		47,554
Partial conversion of Series C preferred stock	$ (1,056)	$ 1,056	70	(70)
Partial conversion of Series C preferred stock (in shares)		348,697
Share-based compensation			814			814
Tax benefit of share-based compensation			96			96
Net issuance of restricted share awards (in shares)		54,830
Net income				11,871		11,871
Other comprehensive income					336	336
Balance at Sep. 30, 2015		$ 165,452	$ 7,964	$ 30,774	$ 1,268	$ 205,458
Balance (in shares) at Sep. 30, 2015		34,352,445

Condensed Consolidated Stateme7

Condensed Consolidated Statements of Shareholders' Equity (Parenthetical) - $ / shares	3 Months Ended		9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014
Condensed Consolidated Statements of Shareholders' Equity
Dividends Declared Per Common Share (in dollars per share)	$ 0.06	$ 0.03	$ 0.17	$ 0.03

Condensed Consolidated Stateme8

Condensed Consolidated Statements of Cash Flows $ in Thousands	9 Months Ended
	Sep. 30, 2015USD ($)	Sep. 30, 2014USD ($)
Cash Flows from Operating Activities
Net income	$ 11,871	$ 4,613
Adjustments to reconcile net income to net cash used in operating activities:
Depreciation and amortization	1,538	1,394
Write-downs on premises and equipment held for sale	68	988
Amortization of premiums / discounts	4,999	3,646
Amortization of intangible assets	787	760
Accretion of discount on acquired and purchased loans, net	(1,524)	(1,791)
Share-based compensation expense	814	723
Gain on extinguishment of debt	(552)
Gain on sale of available for sale securities	(641)	(549)
Gain on sale of assets	(8)
Gain on sale of loans held for sale	(1,277)	(967)
Originations of loans held for sale	(104,656)	(62,385)
Proceeds from sale of loans held for sale	103,153	59,761
Net increase in bank owned life insurance	(480)	(460)
Decrease in deferred tax assets	3,255	3,269
Tax impact of share-based compensation	(96)	(20)
Increase in other assets and other liabilities, net	1,487	1,206
Net cash provided by operating activities	18,738	10,188
Cash Flows from Investing Activities
Net cash and cash equivalents acquired in MISN Transaction		28,891
Purchase of securities, available for sale	(173,560)	(155,956)
Sale of securities, available for sale	55,184	98,379
Proceeds from principal paydowns of securities, available for sale	37,690	30,799
Proceeds from sale of premises and equipment	9	3,594
Purchase of FHLB stock		(941)
Increase in loans, net	(12,820)	(44,855)
Recoveries on previously charged-off loans	776	705
Proceeds from sale of foreclosed collateral	91	(5,122)
Purchase of property, premises and equipment, net	(1,414)
Proceeds from property, premises and equipment, net		1,628
Net cash used in investing activities	(94,044)	(42,878)
Cash Flows from Financing Activities
Increase in deposits, net	176,947	77,509
Proceeds from Federal Home Loan Bank borrowing	36,000	25,000
Repayments of Federal Home Loan Bank borrowing	(52,898)	(44,000)
Decrease in junior subordinated debentures	(2,550)
Proceeds from exercise of stock options, including tax benefits	324	178
Stock issuance costs		(381)
Dividends paid	(5,799)	(1,027)
Repurchases of common stock	(28)
Net cash provided by financing activities	151,996	57,279
Net increase in cash and cash equivalents	76,690	24,589
Cash and cash equivalents, beginning of period	35,580	26,238
Cash and cash equivalents, end of period	112,270	50,827
Cash Flow Information
Interest paid	4,479	3,631
Income taxes paid	1,390	600
Non-Cash Flow Information
Change in unrealized gain on available for sale securities	1,220	6,206
Loans transferred to foreclosed assets	416	1,564
Premises transferred to held for sale		1,730
Accretion of preferred stock	$ 70
Common stock issued in MISN Transaction		$ 60,255

Summary of Significant Accounti

Summary of Significant Accounting Policies	9 Months Ended
	Sep. 30, 2015
Summary of Significant Accounting Policies
Summary of Significant Accounting Policies	Note 1. Summary of Significant Accounting Policies Description of Business Heritage Oaks Bancorp (“Bancorp”) is a California corporation organized in 1994 to act as the holding company for Heritage Oaks Bank (the “Bank”), which opened for business in 1983. The Bank, which is the Company’s sole operating subsidiary, operates branches within San Luis Obispo and Santa Barbara Counties and has a loan production office in Ventura County. The Bank offers traditional banking products such as checking, savings, money market accounts and certificates of deposit, as well as mortgage, commercial, and consumer loans to customers who are predominately small to medium-sized businesses and to individuals. As such, the Company is subject to a concentration risk associated with its banking operations in San Luis Obispo and Santa Barbara Counties, and to a lesser degree Ventura County. No one customer accounts for more than 10% of revenue or assets in any period presented and the Company has no assets nor does it generate any revenue from outside of the United States. While the chief decision-makers of the Company monitor the revenue streams of the various products and services, operations are managed and financial performance is evaluated on a Company-wide basis. Operating segments are aggregated into one as operating results for all segments are similar. Accordingly, all of the financial service operations are considered by management to be aggregated in one reportable operating segment. Basis of Presentation The accompanying unaudited condensed consolidated financial statements of the Company have been prepared in accordance with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, certain information and notes required by accounting principles generally accepted in the United States of America (“U.S. GAAP”) for annual financial statements are not included herein. In the opinion of management, all adjustments (which consist solely of normal recurring accruals) considered necessary for a fair presentation of results for the interim periods presented have been included. These interim unaudited condensed consolidated financial statements should be read in conjunction with the financial statements and related notes contained in the Company’s 2014 Annual Report filed on Form 10-K with the Securities and Exchange Commission on March 6, 2015; file number 000-25020 . The condensed consolidated financial statements include the accounts of Bancorp and its wholly-owned financial subsidiary, Heritage Oaks Bank. All significant inter-company balances and transactions have been eliminated. On February 28, 2014, the Company acquired 100% of the outstanding common shares of Mission Community Bancorp (“MISN”). MISN’s results of operations are included in the Company’s results of operations beginning March 1, 2014. Operating results for the three and nine months ended September 30, 2015 are not necessarily indicative of the results that may be expected for the year ending December 31, 2015. Investment in Non-Consolidated Subsidiaries The Company accounts for its investment in Heritage Oaks Capital Trust II, Mission Community Capital Trust I, and Santa Lucia Bancorp (CA) Capital Trust, as unconsolidated subsidiaries using the equity method of accounting, as the Company is not the primary beneficiary of the trust. Mission Community Capital Trust I and Santa Lucia Bancorp (CA) Capital Trust were acquired as part of the acquisition of Mission Community Bancorp on February 28, 2014. The sole purpose of each of these trusts is for the issuance of trust preferred securities. Reclassifications Certain items in the prior year financial statements were reclassified to conform to the current presentation. Reclassifications had no effect on prior year net income or shareholders’ equity. Use of Estimates in the Preparation of Condensed Consolidated Financial Statements The preparation of condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”), and general practices within the banking industry require management to make estimates and assumptions. These estimates and assumptions affect the reported amounts of assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates. Significant Accounting Policies Update The significant accounting policies that the Company applies are detailed in Note 1. Summary of Significant Accounting Policies, of the Company’s 2014 Annual Report filed on Form 10-K. Changes to accounting policies during the nine months ended September 30, 2015 are discussed below: During the third quarter of 2015, the Company made a specific enhancement to its methodology for determining the general reserve component of the allowance for loan and lease losses (“ALLL”). This enhancement related specifically to the methodology used to calculate the loss rates for loan risk grades within each loan type in the determination of the general reserve component of the ALLL. The enhanced methodology uses more granular loan level data to calculate loss rates for specific loan grades within each loan type, allowing for more detailed loan migration analysis, and the ability to determine more precise average loss rates for each loan risk grade. Although the total general reserve component of the ALLL for each loan type and portfolio segment is still based on total average historical losses for their respective loan types, management believes the allocation of the ALLL to each loan risk grade, within each loan type and the evaluation of the loss emergence period has become more precise under this methodology enhancement. The implementation of the ALLL model enhancements did not result in a required increase or decrease in the balance of the ALLL, or a material impact to the overall allocation of the ALLL. The ALLL model enhancement has allowed the Company to apply more precision in determining loss rates for specific loan grades within each loan type. The section of the accounting policy for the ALLL, which was updated for this methodology enhancement is illustrated below: Allowance for Loan and Lease Losses The Company manages credit risk not only through extensive risk analyses performed prior to a loan’s approval, but also through the ongoing monitoring of loans within the portfolio, and more specifically certain types of loans that generally involve a greater degree of risk, such as commercial real estate, commercial lines of credit, agriculture, and construction/land loans. The Company monitors loans in the portfolio through an exhaustive internal process, at least quarterly, as well as with the assistance of independent loan reviews. These reviews generally not only focus on problem loans, but also internally rated “pass” credits within certain pools of loans that may be expected to experience stress due to economic conditions. This process allows the Company to validate credit risk grade ratings, underwriting structure, and the Company’s estimated exposure in the current economic environment as well as enhance communications with borrowers where necessary in an effort to mitigate potential future losses. All significant problem loans are analyzed in detail at least quarterly, in order to properly estimate potential exposure to loss associated with these loans in a timely manner. Each segment of loans in the portfolio possesses varying degrees of risk, based on, among other things, the type of loan, the purpose of the loan, the type of collateral securing the loan, and the sensitivity the borrower has to changes in certain external factors such as economic conditions. The following provides a summary of the risks associated with various segments of the Company’s loan portfolio, which are factors management regularly considers when evaluating the adequacy of the ALLL: · Real estate secured loans – consist primarily of loans secured by commercial real estate, multi-family, farmland, and 1 to 4 family residential properties. As the majority of this segment is comprised of commercial real estate loans, risks associated with this segment lie primarily within that loan type. Adverse economic conditions may result in a decline in business activity and increased vacancy rates for commercial properties. These factors, in conjunction with a decline in real estate prices, may expose the Company to the potential for losses if a borrower cannot continue to service the loan with operating revenues, and the value of the property has declined to a level such that it no longer fully covers the Company’s recorded investment in the loan. · Construction and land – although construction and land loans generally possess a higher inherent risk of loss than other loans, improvements in the mix, collateral and nature of loans help to mitigate risks within this segment of the portfolio. Risk arises from the necessity to complete projects within specified cost and time limits. Trends in the construction industry may also impact the credit quality of these loans, as demand drives construction activity. In addition, trends in real estate values significantly impact the credit quality of these loans, as property values determine the economic viability of future construction projects. · Commercial and industrial – consist primarily of commercial and industrial loans (business lines of credit), agriculture loans, and other commercial purpose loans. Repayment of commercial and industrial loans is generally provided from the cash flows of the related business to which the loan was made. Adverse changes in economic conditions may result in a decline in business activity, which can impact a borrower’s ability to continue to make scheduled payments. The risk of repayment of agriculture loans arises largely from factors beyond the control of the Company or the related borrower, such as commodity prices, general weather conditions, and drought. · Consumer – the consumer loan portfolio is comprised primarily of a large number of small loans with scheduled amortization over a specific period. The majority of consumer loans include revolving credit plans, installment loans and credit card balances. Weakened economic conditions may result in an increased level of delinquencies within this segment, as economic pressures may impact the capacity of such borrowers to repay their obligations. ALLL Model Methodology The ALLL is maintained at a level which, in management’s judgment, is appropriate to absorb probable credit losses inherent in the loans within the loan portfolio as of the balance sheet date. The amount of the ALLL is based on management’s evaluation of the collectability of the loan portfolio, including the nature and volume of the portfolio, credit concentrations, trends in historical loss experience, the level of certain classified balances and specific impaired loans, and economic conditions and the related impact on specific borrowers and industry groups. The ALLL is increased by provisions for loan and lease losses, which are charged to earnings and reduced (or potentially increased) by charge-offs, net of recoveries. Changes in the ALLL relating to impaired loans, including troubled debt restructurings (“TDRs”), are charged or credited to the provision for loan and lease losses. Because of uncertainties inherent in the estimation process, management’s estimate of probable credit losses inherent in the loan portfolio and the related allowance may change. The process in which management determines the appropriate level of the ALLL involves the exercise of considerable judgment and the use of estimates. While management utilizes its best judgment and all available information in determining the adequacy of the ALLL, the ultimate adequacy of the ALLL is dependent upon a variety of factors beyond the Company’s control, including but not limited to, the performance of the loan portfolio, changes in current and future economic conditions and the view of regulatory agencies regarding the level of classified assets. Weakness in economic conditions and any other factor that may adversely affect credit quality and or that may result in higher levels of: past due and non-accruing loans, loan defaults, and or increased loan charge-offs, may require additional provisions for loan and lease losses in future periods and a higher balance in the Company’s ALLL. The ALLL, as more fully described below, is comprised of three components: general reserves, specific loan reserves, and a reserve for purchased credit impaired (“PCI”) loans. General Reserves – The general reserve component of the ALLL, which is not attributable to loans specifically identified as impaired, is determined through a two-step process. First a quantitative allocation is determined by pooling performing loans by collateral type and purpose. These pools of loans are then further segmented by an internal risk grading system that classifies loans as: pass, special mention, substandard and doubtful. The Company’s risk grade system allows management, among other things, to identify the risk associated with each loan, and to provide a basis for estimating credit losses inherent in the portfolio. Risk grades are generally assigned based on information concerning the borrower and the strength of the collateral. Risk grades are reviewed regularly by the Company’s credit committee and are scrutinized by independent loan reviews performed semi-annually, as well as by regulatory agencies during scheduled examinations. Once credit risk grades have been assigned, estimated loss rates are then applied to each segment according to risk grade to determine the amount of the general portfolio allocation. Estimated loss rates are determined through a migration analysis of historical losses for each segment of the loan portfolio, based on the Company’s prior experience with such loans, and the use of detailed loan level data, encompassing historical losses and average balance information for each loan type and risk grade. The following provides brief definitions for credit risk grade ratings assigned to loans in the portfolio: · Pass – credits that have strong credit quality with adequate collateral or secondary source of repayment and little existing or known weaknesses. However, pass may include credits with exposure to certain potential factors that may adversely impact the credit, if they materialize, resulting in these credits being put on a watch list to monitor more closely than other pass rated credits. Such factors may be credit / relationship specific or general to an entire industry. · Special Mention – credits that have potential weaknesses that deserve management’s close attention. If not corrected, these potential weaknesses may result in deterioration of the repayment prospects for the credit at some future date. · Substandard – credits that have a defined weakness or weaknesses which may jeopardize the orderly liquidation of the loan through cash flows, making it likely that repayment may have to come from some other source, such as the liquidation of collateral. The Company is more likely to incur losses on substandard credits if the weakness or weaknesses identified in the credit are not corrected. · Doubtful – credits that possess the characteristics of a substandard credit, but because of certain existing deficiencies related to the credit, full collection is highly questionable. The probability of incurring some loss on such credits is high, but because of certain important and reasonably specific pending factors which may work to the advantage of strengthening the credit, charge-off is deferred until such time as the Company becomes reasonably certain that certain pending factors related to the credit will no longer provide some form of benefit. The second component of the general reserve allocation of the ALLL is the qualitative allocation, and is determined by estimates the Company makes in regard to certain internal and external factors that may have either a positive or negative impact on the overall losses inherent in the loan portfolio. Internal factors include trends in credit quality of the loan portfolio, the existence and the effects of concentrations, the composition and volume of the loan portfolio and the scope and frequency of the loan review process as well as any other factor determined by management to have an impact on the credit quality of the loan portfolio. External factors include local, state and national economic and business conditions, as well as the estimated impact that environmental factors may have on certain segments of the loan portfolio, such as drought. While management regularly reviews the estimated impact these internal and external factors are expected to have on the loan portfolio, there can be no assurance that an adverse change in any one or combination of these factors will not be in excess of management’s expectations. Recent Accounting Standards Updates Recent Accounting Guidance Adopted In August 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-14 Receivables – Troubled Debt Restructurings by Creditors (Subtopic 310-40), Classification of Certain Government-Guaranteed Mortgage Loans upon Foreclosure . This update addresses classification of government-guaranteed mortgage loans, including those where guarantees are offered by the Federal Housing Administration (“FHA”), the U.S. Department of Housing and Urban Development (“HUD”), and the U.S. Department of Veterans Affairs (“VA”). Although current accounting guidance stipulates proper measurement and classification in situations where a creditor obtains from a debtor, assets in satisfaction of a receivable (such as through foreclosure), current guidance does not specify how to measure and classify foreclosed mortgage loans that are government-guaranteed. Under the provisions of this update, a creditor would derecognize a mortgage loan that has been foreclosed upon, and recognize a separate receivable if the following conditions are met: (1) the loan has a government guarantee that is not separable from the loan before foreclosure, (2) at the time of foreclosure, the creditor has the intent to convey the real estate property to the guarantor and make a claim on the guarantee, and the creditor has the ability to recover under that claim, (3) at the time of foreclosure, any amount of the claim that is determined on the basis of the fair value of the real estate is fixed. The amendments within this update are effective for interim and annual periods, beginning after December 15, 2014. The adoption of this update did not have a material impact on the Company’s consolidated financial statements. In January 2014, the FASB issued ASU No. 2014-04, Receivables – Troubled Debt Restructurings by Creditors . This ASU provides clarification that an in substance repossession or foreclosure occurs, and a creditor is considered to have received physical possession of residential real estate property collateralizing a consumer mortgage loan, upon either (1) the creditor obtaining legal title to the residential real estate property upon completion of a foreclosure or (2) the borrower conveying all interest in the residential real estate property to the creditor to satisfy that loan through completion of a deed in lieu of foreclosure or through a similar legal agreement. Additionally, the amendments require interim and annual disclosure of both (1) the amount of foreclosed residential real estate property held by the creditor and (2) the recorded investment in consumer mortgage loans collateralized by residential real estate property that are in the process of foreclosure according to local requirements of the applicable jurisdiction. The amendments in this ASU are effective for public business entities for interim and annual periods, beginning after December 15, 2014. The adoption of this update did not have a material impact on the Company’s consolidated financial statements. Recent Accounting Guidance Not Yet Effective In September, 2015, the FASB issued ASU No. 2015-16, Simplifying the Accounting for Measurement Period Adjustments (Topic 805). This ASU eliminates the requirement to restate prior period financial statements for measurement period adjustments to assets acquired and liabilities assumed in a business combination. The new guidance under this update requires the cumulative impact of measurement period adjustments be recognized in the period the adjustment is determined. This update does not change what constitutes a measurement period adjustment, nor does it change the length of the measurement period. The new standard is effective for interim annual periods beginning after December 15, 2015 and should be applied prospectively to measurement period adjustments that occur after the effective date. The Company does not expect the adoption of this update to have a material impact on the Company’s consolidated financial statements. In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) . This update requires an entity to recognize revenue as performance obligations are met, in order to reflect the transfer of promised goods or services to customers in an amount that reflects the consideration the entity is entitled to receive for those goods or services. The following steps are applied in the updated guidance: (1) identify the contract(s) with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to the performance obligations in the contract; and (5) recognize revenue when, or as, the entity satisfies a performance obligation. The amendments within this update are effective for the quarter ending March 31, 2018. The Company is currently in the process of evaluating the impact of the adoption of this update, but does not expect a material impact on the Company’s consolidated financial statements.

Business Combination

Business Combination	9 Months Ended
	Sep. 30, 2015
Business Combination
Business Combination	Note 2. Business Combination On February 28, 2014, the Company acquired 100% of the outstanding common shares of Mission Community Bancorp (“MISN”) and all unexercised warrants and options to purchase MISN common stock were cancelled, in exchange for 7,541,326 shares of the Company’s common stock and $8.7 million in cash (the “MISN Transaction”). In conjunction with the merger, MISN’s wholly-owned bank subsidiary, Mission Community Bank, was merged with and into Heritage Oaks Bank. The transaction was valued at $69.0 million, based on the Company’s closing stock price of $7.99 on February 28, 2014. With the acquisition, the Company believes it has created a more valuable community banking franchise, with a low-cost core deposit base, strong capital ratios, attractive net interest margins, lower operating costs, and better overall returns for the shareholders of the combined company. The Company also believes it now has a banking platform that is well positioned for future growth, both organically and through acquisitions. The operating results for MISN are included in the Company’s condensed consolidated financial statements for the three and nine months ended September 30, 2015, and from March 1, 2014 through September 30, 2014. As of December 31, 2014, adjustments to the fair value of assets acquired and liabilities assumed in the MISN Transaction were complete. The following table presents unaudited pro forma financial information for the three and nine months ended September 30, 2014, as if the MISN Transaction were reflected in the Company’s operating results beginning on January 1, 2013. The unaudited pro forma information includes adjustments for interest income on loans and securities acquired, amortization of intangibles arising from the transaction, depreciation expense on property acquired, interest expense on deposits and borrowings acquired, and the related income tax effects. The unaudited pro forma financial information is not necessarily indicative of the results of operations that would have occurred had the transaction been effected on the assumed date. Three Months Ended September 30, 2014 Nine Months Ended September 30, 2014 (dollars in thousands, except per share data) Net interest income $ $ Provision for loan and lease losses - - Non-interest income Non-interest expense Income before income taxes Income tax expense Net income $ $ Earnings Per Common Share Basic $ $ Diluted $ $

Fair Value of Assets and Liabil

Fair Value of Assets and Liabilities	9 Months Ended
	Sep. 30, 2015
Fair Value of Assets and Liabilities
Fair Value of Assets and Liabilities	Note 3. Fair Value of Assets and Liabilities Recurring Basis The following table provides a summary of the assets the Company measures at fair value on a recurring basis: Fair Value Measurements at the End of the Reporting Period Using As of Quoted Prices in Significant Other Significant September 30, 2015 Active Markets for Observable Unobservable Assets At Identical Assets Inputs Inputs Fair Value (Level 1) (Level 2) (Level 3) (dollars in thousands) Assets Obligations of U.S. government agencies $ $ - $ $ - Mortgage backed securities: U.S government sponsored entities and agencies - - Non-agency - - State and municipal securities - - Asset backed securities - - Other investments - - Total assets measured on a recurring basis $ $ $ $ - Fair Value Measurements at the End of the Reporting Period Using As of Quoted Prices in Significant Other Significant December 31, 2014 Active Markets for Observable Unobservable Assets At Identical Assets Inputs Inputs Fair Value (Level 1) (Level 2) (Level 3) (dollars in thousands) Assets Obligations of U.S. government agencies $ $ - $ $ - Mortgage backed securities: U.S government sponsored entities and agencies - - Non-agency - - State and municipal securities - - Asset backed securities - - Total assets measured on a recurring basis $ $ - $ $ - Non-recurring Basis The Company may be required, from time to time, to measure certain assets and liabilities at fair value on a non-recurring basis. These include assets and liabilities that are measured at the lower of cost or fair value, and were measured at fair value which was below cost. Certain impaired loans measured at fair value at December 31, 2014 are no longer recorded at fair value due to the borrower payments reducing the carrying value of these loans to less than fair value, and due to other impaired loans being evaluated under the discounted cash flow method versus the collateral method. The discounted cash flow method as prescribed by ASC 310 Receivables , is not a fair value measurement since the discount rate utilized is the loan’s effective interest rate, which is not a market rate. The discounted cash flow approach is used to measure impairment for certain impaired loans, because of their significant payment history and the global cash flow analysis performed on each borrower. The following tables provide a summary of assets the Company measures at fair value on a non-recurring basis: Fair Value Measurements at the End of the Reporting Period Using As of Quoted Prices in Significant Other Significant September 30, 2015 Active Markets for Observable Unobservable Year To Assets At Identical Assets Inputs Inputs Date Losses Fair Value (Level 1) (Level 2) (Level 3) (Recoveries) (dollars in thousands) Assets Impaired loans: Land $ $ - $ - $ $ Total assets measured on a non-recurring basis $ $ - $ - $ $ Fair Value Measurements at the End of the Reporting Period Using As of Quoted Prices in Significant Other Significant December 31, 2014 Active Markets for Observable Unobservable Year To Assets At Identical Assets Inputs Inputs Date Losses Fair Value (Level 1) (Level 2) (Level 3) (Recoveries) (dollars in thousands) Assets Impaired loans: Commercial real estate $ $ - $ - $ $ Land - - Total assets measured on a non-recurring basis $ $ - $ - $ $ There were no transfers into or out of Level 1 or Level 2 assets reported at fair value on either a recurring or non-recurring basis during the three or nine months ended September 30, 2015. Fair Value of Financial Instruments The following table provides a summary of the estimated fair value of financial instruments: Fair Value Measurements at the End of the Reporting Period Using As of Quoted Prices in Significant Other Significant September 30, 2015 Active Markets for Observable Unobservable Carrying Identical Assets Inputs Inputs Amount (Level 1) (Level 2) (Level 3) Fair Value (dollars in thousands) Assets Cash and cash equivalents $ $ $ - $ - $ Investment securities available for sale - Federal Home Loan Bank stock - - - N/A Loans receivable, net of deferred fees and costs - - Loans held for sale - - Accrued interest receivable - Liabilities Non-interest bearing deposits - - Interest bearing deposits - - Federal Home Loan Bank advances - - Junior subordinated debentures - - Accrued interest payable - - Fair Value Measurements at the End of the Reporting Period Using As of Quoted Prices in Significant Other Significant December 31, 2014 Active Markets for Observable Unobservable Carrying Identical Assets Inputs Inputs Amount (Level 1) (Level 2) (Level 3) Fair Value (dollars in thousands) Assets Cash and cash equivalents $ $ $ - $ - $ Investment securities available for sale - - Federal Home Loan Bank stock - - - N/A Loans receivable, net of deferred fees and costs - - Loans held for sale - - Accrued interest receivable - Liabilities Non-interest bearing deposits - - Interest bearing deposits - - Federal Home Loan Bank advances - - Junior subordinated debentures - - Accrued interest payable - - Information on off-balance-sheet instruments follows: September 30, 2015 December 31, 2014 Notional Cost to Cede Notional Cost to Cede Amount or Assume Amount or Assume (dollars in thousands) Off-balance sheet instruments, commitments to extend credit and standby letters of credit $ $ $ $

Investment Securities

Investment Securities	9 Months Ended
	Sep. 30, 2015
Investment Securities
Investment Securities	Note 4. Investment Securities The following table sets forth the amortized cost and fair values of the Company’s investment securities, all of which are reported as available for sale: September 30, 2015 Gross Gross Amortized Unrealized Unrealized Fair Cost Gains Loss Value (dollars in thousands) Obligations of U.S. government agencies $ $ $ $ Mortgage backed securities U.S. government sponsored entities and agencies Non-agency State and municipal securities Asset backed securities - Other investments - Total available for sale securities $ $ $ $ December 31, 2014 Gross Gross Amortized Unrealized Unrealized Fair Cost Gains Loss Value (dollars in thousands) Obligations of U.S. government agencies $ $ $ $ Mortgage backed securities U.S. government sponsored entities and agencies Non-agency State and municipal securities Asset backed securities - Total available for sale securities $ $ $ $ The following table provides a summary of investment securities in an unrealized loss position: September 30, 2015 Less Than Twelve Months Twelve Months or More Total Fair Unrealized Fair Unrealized Fair Unrealized Value Loss Value Loss Value Loss (dollars in thousands) Obligations of U.S. government agencies $ $ $ - $ - $ $ Mortgage backed securities U.S. government sponsored entities and agencies Non-agency State and municipal securities Asset backed securities - - Other investments - - Total $ $ $ $ $ $ December 31, 2014 Less Than Twelve Months Twelve Months or More Total Fair Unrealized Fair Unrealized Fair Unrealized Value Loss Value Loss Value Loss (dollars in thousands) Obligations of U.S. government agencies $ $ $ $ $ $ Mortgage backed securities U.S. government sponsored entities and agencies Non-agency State and municipal securities Asset backed securities - - Total $ $ $ $ $ $ A total of 78 securities were in an unrealized loss position as of September 30, 2015, and 57 securities as of December 31, 2014. As of September 30, 2015, the Company believes that unrealized losses in its investment securities portfolio are not attributable to credit quality, but rather fluctuations in market prices for these investments. In the case of the agency mortgage related securities, they have contractual cash flows guaranteed by agencies of the U.S. Government. While the Company’s investment security holdings have contractual maturity dates that range from 1 to 40 years, they have a much shorter effective duration dependent on the instrument’s priority in the overall cash flow structure and the characteristics of the loans underlying the investment security. Management does not intend to sell and it is unlikely that management will be required to sell the securities prior to their anticipated recovery in value. As of September 30, 2015, the Company does not believe unrealized losses related to any of its securities are other than temporary. Sales of Available for Sale Securities The proceeds from the sale of securities and the associated gains and losses are listed below: For Three Months Ended For Nine Months Ended September 30, September 30, 2015 2014 2015 2014 (dollars in thousands) Proceeds $ $ $ $ Gross gains Gross losses - Income tax expense on net realized gains from the sale of investment securities for the three months ended September 30, 2015 and 2014 was $57 thousand and $189 thousand. Income tax expense related to net realized gains on the sale of securities was $270 thousand and $231 thousand for the nine months ended September 30, 2015 and 2014, respectively. Maturities of Available for Sale Securities The amortized cost and fair value maturities of available for sale investment securities at September 30, 2015 are shown below. The table reflects the expected lives of mortgage backed securities, based on the Company’s historical prepayment experience, because borrowers who are party to loans underlying these securities may have the right to prepay obligations without prepayment penalties. Therefore actual maturities may differ from contractual maturities. Contractual maturities are reflected for all other security types. September 30, 2015 December 31, 2014 Amortized Amortized Cost Fair Value Cost Fair Value (dollars in thousands) Due one year or less $ $ $ $ Due after one year through five years Due after five years through ten years Due after ten years Total $ $ $ $ Securities having an amortized cost and a fair value of $141.5 million and $148.9 million, respectively, at September 30, 2015, and $67.3 million and $72.5 million, respectively, at December 31, 2014 were pledged to secure public deposits. As of September 30, 2015 and December 31, 2014, there were no holdings of securities of any one issuer, other than the U.S. Government and its agencies, in an amount greater than 10% of total securities. The following table summarizes earnings on both taxable and tax-exempt investment securities: For the Three Months Ended For the Nine Months Ended September 30, September 30, 2015 2014 2015 2014 (dollars in thousands) Taxable earnings on investment securities Obligations of U.S. government agencies $ $ $ $ Mortgage backed securities State and municipal securities Corporate debt securities - - - Asset backed securities Non-taxable earnings on investment securities State and municipal securities Total $ $ $ $

Loans and Allowance for Loan an

Loans and Allowance for Loan and Lease Losses	9 Months Ended
	Sep. 30, 2015
Loans and Allowance for Loan and Lease Losses
Loans and Allowance for Loan and Lease Losses	Note 5. Loans and Allowance for Loan and Lease Losses The following table provides a summary of outstanding loan balances: September 30, 2015 December 31, 2014 Non-PCI PCI Non-PCI PCI Loans Loans Total Loans Loans Total (dollars in thousands) Real Estate Secured Commercial $ $ $ $ $ $ Residential 1 to 4 family Farmland - Multi-family residential - - Construction and land Home equity lines of credit - - Total real estate secured Commercial Commercial and industrial Agriculture Other - - - - Total commercial Consumer - - Total gross loans held for investment Net deferred loan fees - - Allowance for loan and lease losses - Total net loans held for investment $ $ $ $ $ $ Loans held for sale $ $ - $ $ $ - $ At September 30, 2015, and December 31, 2014, the loan portfolio includes loans purchased with evidence of deterioration in credit quality since their origination, referred to as “PCI loans.” These loans are specifically accounted for under ASC 310-30, as more fully discussed in Note 1. Summary of Significant Accounting Policies of the consolidated financial statements in the Company’s 2014 annual report filed on Form 10-K. These loans were acquired as part of the MISN Transaction. All other loans, referred to as “non-PCI loans,” consist of originated loans, as well as acquired and purchased loans which have not exhibited evidence of deteriorated credit quality since their origination. Non-PCI loans are not accounted for within the scope of ASC 310-30. Gross loans include $195.8 million and $239.7 million of loans acquired in the MISN Transaction at September 30, 2015 and December 31, 2014, respectively. These loans were recorded at fair value on the date of acquisition. Of the loans acquired in the MISN transaction, $9.4 million and $10.3 million at September 30, 2015 and December 31, 2014, respectively, are considered PCI loans. Loans held for sale are primarily single-family residential mortgage loans under contract to be sold in the secondary market. In most cases, loans in this category are sold within thirty to sixty days. Under a blanket lien to the Federal Home Loan Bank (“FHLB”), the Bank has pledged $601.4 million in loans to secure a credit facility totaling $400.1 million, of which $78.5 million is outstanding as of September 30, 2015. Of this credit facility, $11.5 million is available as a line of credit, while the remainder is available for potential future borrowings. The Bank also has a collateralized borrowing line with the Federal Reserve Bank secured by $6.9 million of loans as of September 30, 2015. Concentration of Credit Risk The Company held loans that were collateralized by various forms of real estate, including residential 1 to 4 family loans originated and held for sale, totaling $999.4 million and $978.2 million at September 30, 2015 and December 31, 2014, respectively. These loans are generally made to borrowers located in the counties of San Luis Obispo, Santa Barbara and Ventura. The Company attempts to reduce its concentration of credit risk by making loans which are diversified by product type. While management believes that the collateral presently securing this portfolio is adequate, there can be no assurances that deterioration in the California real estate market, or the impact of the current California drought on our real estate collateralized loans, would not expose the Company to significantly greater credit risk. Loans Serviced for Others Loans serviced for others are not included in the accompanying balance sheets. The unpaid principal balance of loans serviced for others, exclusive of Small Business Administration (“SBA”) loans, was $41.8 million at September 30, 2015 and $44.8 million at December 31, 2014. From time to time, the Company also originates SBA loans for sale and retains the servicing of the guaranteed portion of the loan sold. At September 30, 2015 and December 31, 2014, the unpaid principal balance of SBA loans serviced for others totaled $9.0 million and $13.0 million, respectively. No gains were recorded on the sale of SBA loans during the three or nine months ended September 30, 2015 and 2014. Impaired Loans The following tables provide a summary of the Company’s recorded investment in non-PCI and PCI impaired loans as of September 30, 2015, and presents average balances and interest income recognized for non-PCI and PCI impaired loans for the three and nine months ended September 30, 2015. For the Three Months Ended For the Nine Months Ended September 30, 2015 September 30, 2015 September 30, 2015 Unpaid Specific Average Interest Average Interest Recorded Principal Allowance for Recorded Income Recorded Income Investment Balance Impaired Loans Investment Recognized Investment Recognized (dollars in thousands) Non-PCI Loans Without Related Allowance Real Estate Secured Commercial $ $ $ - $ $ $ $ Construction and land - Residential 1 to 4 family - Farmland - Home equity lines of credit - - - Commercial Commercial and industrial - Agriculture - Consumer - Total - With Related Allowance Real Estate Secured Construction and land - - Commercial - - Commercial Commercial and industrial Total Total Non-PCI impaired loans $ $ $ $ $ $ $ For the Three Months Ended For the Nine Months Ended September 30, 2015 September 30, 2015 September 30, 2015 Unpaid Specific Average Interest Average Interest Recorded Principal Allowance for Recorded Income Recorded Income Investment Balance Impaired Loans Investment Recognized Investment Recognized (dollars in thousands) PCI Loans Without Related Allowance Real Estate Secured Commercial $ $ $ - $ $ $ $ Residential 1 to 4 family - Construction and land - Commercial Agriculture - Commercial and industrial - Total - With Related Allowance Real Estate Secured Commercial Construction and land Commercial Commercial and industrial Total Total PCI loans $ $ $ $ $ $ $ The following table provides a summary of the Company’s recorded investment in non-PCI and PCI impaired loans as of December 31, 2014, and presents average balances and interest income recognized for non-PCI and PCI impaired loans for the three and nine months ended September 30, 2014. For the Three Months Ended For the Nine Months Ended December 31, 2014 September 30, 2014 September 30, 2014 Unpaid Specific Average Interest Average Interest Recorded Principal Allowance for Recorded Income Recorded Income Investment Balance Impaired Loans Investment Recognized Investment Recognized (dollars in thousands) Non-PCI Loans Without Related Allowance Real Estate Secured Commercial $ $ $ - $ $ $ $ Construction and land - Farmland - Residential 1 to 4 family - Home equity lines of credit - - - Commercial Commercial and industrial - Agriculture - Consumer - Total - With Related Allowance Real Estate Secured Construction and land Commercial - - Commercial Commercial and industrial Total Total Non-PCI impaired loans $ $ $ $ $ $ $ For the Three Months Ended For the Nine Months Ended December 31, 2014 September 30, 2014 September 30, 2014 Unpaid Specific Average Interest Average Interest Recorded Principal Allowance for Recorded Income Recorded Income Investment Balance Impaired Loans Investment Recognized Investment Recognized (dollars in thousands) PCI Loans Without Related Allowance Real Estate Secured Commercial $ $ $ - $ $ $ $ Farmland - Construction and land - Residential 1 to 4 family - Home equity lines of credit - - - Commercial Agriculture - Commercial and industrial - Total PCI loans $ $ $ - $ $ $ $ The Company did not record income from the receipt of cash payments related to non-accruing loans during the three and nine months ended September 30, 2015 and 2014. Interest income recognized on impaired loans in the tables above represents interest on accruing troubled debt restructurings, and accretion on PCI loans. Valuation allowances for impaired loans have been determined on a loan-by-loan basis. At September 30, 2015, there were no residential 1 to 4 family loans in process of foreclosure, or residential 1 to 4 family properties included in foreclosed assets. Troubled Debt Restructurings (“TDR”) The following table provides a summary of loans that were classified as TDRs as of the dates indicated below: September 30, 2015 December 31, 2014 Accrual Non-accrual Total Accrual Non-accrual Total (dollars in thousands) Non-PCI Loans Real Estate Secured Commercial $ $ $ $ $ $ Construction and land Residential 1 to 4 family Farmland - - Commercial Commercial and industrial Agriculture - - Consumer - Total non-PCI loans PCI Loans Real Estate Secured Commercial - Construction and land - - - - Commercial Commercial and industrial Total PCI loans Total TDRs $ $ $ $ $ $ The majority of the Company’s TDRs resulted from granting concessions with respect to interest rates, payment structure and/or maturity. Modifications for the three and nine months ended September 30, 2015, and 2014 relate substantially to extensions of the maturity date at the loan’s original interest rate, which was lower than the current market rate for new debt with similar risk. The maturity date extensions granted were for periods ranging from 6 months to 10 years. As of September 30, 2015, the Company was not committed to lend any additional funds to borrowers whose obligations to the Company were restructured. During the three and nine months ended September 30, 2015, an ALLL of approximately $0.1 million was established for one loan at the time the loan was modified as a TDR. The financial effects of modifications for the three and nine months ended September 30, 2014 were not material. The following tables summarize loan modifications which resulted in TDRs during the periods presented below: For the Three Months Ended For the Nine Months Ended September 30, 2015 September 30, 2015 Pre-Modification Post-Modification Pre-Modification Post-Modification Outstanding Outstanding Outstanding Outstanding Number Recorded Recorded Number Recorded Recorded of TDRs Investment Investment of TDRs Investment Investment (dollars in thousands) Non-PCI Loans Real Estate Secured Residential 1 to 4 family $ $ $ $ Farmland Commercial - - - Construction and land - - - Commercial Commercial and industrial Agriculture Consumer PCI Loans Real Estate Secured Commercial Construction and land - - - Commercial Commercial and industrial Total $ $ $ $ For the Three Months Ended For the Nine Months Ended September 30, 2014 September 30, 2014 Pre-Modification Post-Modification Pre-Modification Post-Modification Outstanding Outstanding Outstanding Outstanding Number Recorded Recorded Number Recorded Recorded of TDRs Investment Investment of TDRs Investment Investment (dollars in thousands) Non-PCI Loans Real Estate Secured Construction and land $ $ $ $ Commercial - - - Commercial Commercial and industrial Agriculture - - - Consumer - - - PCI Loans Real Estate Secured Commercial - - - Commercial Commercial and industrial - - - Total $ $ $ $ The following tables summarizes loans that were modified as troubled debt restructurings within the twelve months prior to the balance sheet date, and for which there was a payment default during the periods presented below: For the Three Months Ended For the Nine Months Ended September 30, 2015 September 30, 2015 Number of TDRs Recorded Investment Number of TDRs Recorded Investment Non-PCI Loans (dollars in thousands) Commercial Commercial and industrial - $ - $ Total - $ - $ For the Three Months Ended For the Nine Months Ended September 30, 2014 September 30, 2014 Number of TDRs Recorded Investment Number of TDRs Recorded Investment Non-PCI Loans (dollars in thousands) Commercial Commercial and industrial - $ - $ Total - $ - $ Credit Quality The following tables stratify loans held for investment by the Company’s internal risk grading system: September 30, 2015 Credit Risk Grades Special Pass Mention Substandard Doubtful Total (dollars in thousands) Non-PCI Loans Real Estate Secured Commercial $ $ $ $ - $ Residential 1 to 4 family - - Farmland - Multi-family residential - - Construction and land - Home equity lines of credit - - Commercial Commercial and industrial - Agriculture - Other - - - - - Consumer - - Total non-PCI loans - PCI Loans Real Estate Secured Commercial - - Construction and land - Residential 1 to 4 family - - Commercial Agriculture - - - Commercial and industrial - Total PCI loans - Total loans held for investment $ $ $ $ - $ December 31, 2014 Credit Risk Grades Special Pass Mention Substandard Doubtful Total (dollars in thousands) Non-PCI Loans Real Estate Secured Commercial $ $ $ $ - $ Residential 1 to 4 family - Farmland - Multi-family residential - - Home equity lines of credit - - Construction and land - - Commercial Commercial and industrial Agriculture - Other - - - Consumer - - Total non-PCI loans PCI Loans Real Estate Secured Commercial - Farmland - - - Construction and land - - Residential 1 to 4 family - - - Commercial Agriculture - - - Commercial and industrial Total PCI loans Total loans held for investment $ $ $ $ $ Aging of Loans Held for Investment The following tables summarize the aging of loans held for investment as of the dates indicated below: September 30, 2015 Days Past Due 90+ and Still Non- Current 30-59 60-89 Accruing Accruing Total (dollars in thousands) Non-PCI Loans Real Estate Secured Commercial $ $ $ - $ - $ $ Residential 1 to 4 family - - - Farmland - - - Multi-family residential - - - - Construction and land - - - Home equity lines of credit - - - Commercial - Commercial and industrial - - Agriculture - - - - Other - - - - - - Consumer - - - Total non-PCI loans - - PCI Loans Real Estate Secured Commercial - - - Land - - - - Residential 1 to 4 family - - - - Commercial Agriculture - - - - Commercial and industrial - - - Total PCI loans - - - Total loans held for investment $ $ $ - $ - $ $ December 31, 2014 Days Past Due 90+ and Still Non- Current 30-59 60-89 Accruing Accruing Total (dollars in thousands) Non-PCI Loans Real Estate Secured Commercial $ $ - $ - $ - $ $ Residential 1 to 4 family - - - Farmland - - - - Multi-family residential - - - - Construction and land - - - Home equity lines of credit - - - Commercial Commercial and industrial - - Agriculture - - - Other - - - - Consumer - Total non-PCI loans - PCI Loans Real Estate Secured Commercial - - - - Farmland - - - - Construction and land - - - - Residential 1 to 4 family - - - - Commercial Agriculture - - - - Commercial and industrial - - - Total PCI loans - - - Total loans held for investment $ $ $ $ - $ $ Purchased Credit Impaired Loans As part of the MISN Transaction , disclosed in Note 2. Business Combination, the Company acquired certain loans which have exhibited evidence of credit deterioration since their origination. The carrying amount and unpaid principal balance of these loans are as follows: September 30, 2015 December 31, 2014 Unpaid Principal Balance Carrying Amount Unpaid Principal Balance Carrying Amount (dollars in thousands) Real Estate Secured Commercial $ $ $ $ Construction and land Residential 1 to 4 family Farmland - - Total real estate secured Commercial Commercial and industrial Agriculture Total commercial Total PCI loans $ $ $ $ The following table summarizes the accretable yield, or income expected to be collected for PCI loans: For the Nine Months Ended September 30, 2015 (dollars in thousands) Balance, December 31, 2014 $ Accretion of income Reclassifications from nonaccretable difference (1) Balance, September 30, 2015 $ (1) Reclassification from nonaccretable difference is attributable to positive changes in expected future cash flows on certain PCI loans. Allowance for Loan and Lease Losses The following table summarizes the activity in the allowance for loan and lease losses by portfolio segment for the periods presented below: For the Three Months Ended September 30, 2015 Balance June 30, 2015 Charge-offs Recoveries Provision for Loan and Lease Losses Balance September 30, 2015 (dollars in thousands) Other real estate secured $ $ - $ $ $ Commercial Construction and land - Consumer Unallocated - Total $ $ $ $ - $ For the Nine Months Ended September 30, 2015 Balance December 31, 2014 Charge-offs Recoveries Provision for Loan and Lease Losses Balance September 30, 2015 (dollars in thousands) Other real estate secured $ $ $ $ $ Commercial Construction and land Consumer Unallocated - Total $ $ $ $ - $ For the Three Months Ended September 30, 2014 Balance June 30, 2014 Charge-offs Recoveries Provision for Loan and Lease Losses Balance September 30, 2014 (dollars in thousands) Other real estate secured $ $ $ $ $ Commercial - Construction and land - Consumer Unallocated Total $ $ $ $ - $ For the Nine Months Ended September 30, 2014 Balance December 31, 2013 Charge-offs Recoveries Provision for Loan and Lease Losses Balance September 30, 2014 (dollars in thousands) Other real estate secured $ $ $ $ $ Commercial Construction and land - Consumer Unallocated Total $ $ $ $ - $ The following tables disaggregate the allowance for loan and lease losses and the recorded investment in loans by impairment methodology as of the dates presented below: September 30, 2015 Allowance for Loan and Lease Losses Recorded Investment in Loans Individually Evaluated for Impairment Collectively Evaluated for Impairment Loans Acquired with Deteriorated Credit Quality Individually Evaluated for Impairment Collectively Evaluated for Impairment Loans Acquired with Deteriorated Credit Quality (dollars in thousands) Other real estate secured $ $ $ $ $ $ Commercial Construction and land Consumer - - - Unallocated - - - Total $ $ $ $ $ $ December 31, 2014 Allowance for Loan and Lease Losses Recorded Investment in Loans Individually Evaluated for Impairment Collectively Evaluated for Impairment Loans Acquired with Deteriorated Credit Quality Individually Evaluated for Impairment Collectively Evaluated for Impairment Loans Acquired with Deteriorated Credit Quality (dollars in thousands) Other real estate secured $ $ $ - $ $ $ Commercial - Construction and land - Consumer - - - Unallocated - - Total $ $ $ - $ $ $ At September 30, 2015, total gross loans of $1.2 billion in the table above include $195.8 million of loans acquired through the MISN Transaction. These loans were initially recorded at fair value, and had no related ALLL on the acquisition date. The ALLL for acquired non-PCI loans at September 30, 2015 and December 31, 2014 was $0.4 million, and $1.0 million, respectively, and is the result of determining, through the Company’s ALLL methodology, that the existing discount for acquired non-PCI loans was no longer deemed sufficient to cover probable losses incurred in particular segments of the loan portfolio, specifically commercial and industrial, other real estate secured, and consumer loans. The incremental ALLL allocation for acquired non-PCI loans was not driven by deterioration in credit quality; rather due to the acceleration of accretion of purchase discounts related to loan pay-downs and payoffs of loans within these segments of the acquired loan portfolio. The ALLL allocated to acquired non-PCI loans is included in the ALLL attributable to loans collectively evaluated for impairment in the tables above. The ALLL for PCI loans was $82 thousand at September 30, 2015, and resulted from unfavorable changes in expected future cash flows on certain PCI loans. There was no ALLL for PCI loans at December 31, 2014.

Income Taxes

Income Taxes	9 Months Ended
	Sep. 30, 2015
Income Taxes
Income Taxes	Note 6. Income Taxes Deferred tax assets relate to amounts that are expected to be realized through subsequent reversals of existing temporary differences over the period they are expected to reverse. The ultimate realization of the Company’s deferred tax assets is dependent upon the generation of future taxable income during the periods in which temporary differences are expected to reverse. U.S. GAAP requires that companies assess whether a valuation allowance should be established against deferred tax assets based on the consideration of all available evidence using a “more likely than not” standard. In making such judgments, significant weight is given to evidence, both positive and negative, that can be objectively verified. At September 30, 2015 and December 31, 2014 there was no valuation allowance for the Company’s deferred tax assets. The Company’s deferred tax assets totaled $21.4 million at September 30, 2015, and $24.9 million at December 31, 2014. The Company is subject to income taxation by both federal and state taxing authorities. Income tax returns for the years ended December 31, 2014, 2013, 2012, 2011, and 2010 are open to audit by federal and state taxing authorities. The Company does not have any uncertain income tax positions and has not accrued for any interest or penalties as of September 30, 2015 and December 31, 2014. Management assessed the impact of the MISN Transaction for limitations under I.R.C. Section 382 and determined that, given the assumption that the Company generates sufficient future taxable income to utilize NOLs, no loss of NOL utilization would result from the estimated annual I.R.C. Section 382 base limitation resulting from the transaction. Furthermore, due to the fact that MISN was in a net unrealized built-in gain position (“NUBIG”) the Company’s annual I.R.C. Section 382 limitation will likely increase over the next five years for realized built-in gains (“RBIG”).

Goodwill and Other Intangible A

Goodwill and Other Intangible Assets	9 Months Ended
	Sep. 30, 2015
Goodwill and Other Intangible Assets
Goodwill and Other Intangible Assets	Note 7. Goodwill and Other Intangible Assets At September 30, 2015 and December 31, 2014 the balance of goodwill was $24.9 million. Other intangible assets consist of core deposit intangibles (“CDI”), which are attributable to the acquisition of core deposit balances, including those acquired in the MISN Transaction. CDI assets are subject to amortization. At September 30, 2015 and December 31, 2014 the balance of CDI was $4.6 million, and $5.3 million, respectively. Amortization of CDI for the nine months ended September 30, 2015 and 2014 was approximately $0.8 million during both periods. The following table summarizes the gross carrying amount, accumulated amortization and net carrying amount of CDI as of September 30, 2015, and provides an estimate for future amortization for 2015 and the next five years: September 30, 2015 Gross Carrying Accumulated Net Carrying Amount Amortization Amount (dollars in thousands) Core deposit intangibles $ $ $ September 30, 2015 Beginning Balance Estimated Remaining Amortization Projected Ending Balance (dollars in thousands) Period Year 2015 $ $ $ Year 2016 Year 2017 Year 2018 Year 2019 Year 2020

Share-based Compensation Plans

Share-based Compensation Plans	9 Months Ended
	Sep. 30, 2015
Share-based Compensation Plans
Share-based Compensation Plans	Note 8. Share-Based Compensation Plans As of September 30, 2015, the Company had one active share-based employee compensation plan, which was approved by the Company’s shareholders in May 2015. This plan, referred to as the “2015 Equity Incentive Plan,” authorizes the Company to grant various types of share-based compensation awards to the Company’s employees and Board of Directors such as stock options, and restricted stock awards. Under the 2015 Equity Incentive Plan a maximum of 2,500,000 shares of the Company’s common stock may be issued. Shares issued under this plan, other than stock options and stock appreciation rights, are counted against the plan on a two shares for every one share actually issued basis. Awards that are cancelled, expired, forfeited, fail to vest, or otherwise result in issued shares not being delivered to the grantee, are again made available for the issuance of future share-based compensation awards. Additionally, under this plan, no one individual may be granted shares in aggregate that exceed more than 250,000 shares during any calendar year. The Company’s Board of Directors may terminate the 2015 Equity Incentive Plan at any time, and for any reason before the plan expires on December 3, 2024. The Company also has two non-active share-based compensation plans, which are more fully described in Note 12. Share-Based Compensation Plans, of the condensed consolidated financial statements in the Company’s Annual Report filed on Form 10-K for the year ended December 31, 2014. These plans include the “1997 Stock Option Plan” and the “2005 Equity Based Compensation Plan.” As of September 30, 2015 no further grants can be made from either of these plans. The following table provides a summary of the expenses the Company has recognized related to share-based compensation for the periods indicated below: For the Three Months Ended For the Nine Months Ended September 30, September 30, 2015 2014 2015 2014 (dollars in thousands) Share-based compensation expense: Stock options $ $ $ $ Restricted stock Total expense $ $ $ $ Unrecognized compensation expense: Stock options $ $ Restricted stock Total unrecognized expense $ $ At September 30, 2015 unrecognized compensation expense related to non-vested stock options and restricted stock awards is expected to be recognized over weighted average periods of 2.8 years and 1.9 years, respectively. Restricted Stock Awards The Company grants restricted stock periodically for the benefit of employees. Restricted stock issued typically vests ratably over a period of three to five years depending on the specific terms of the grant. Restricted stock grants may be subject to the achievement of certain performance goals. Compensation costs related to restricted stock awards are charged to earnings, included in salaries and employee benefits, over the vesting period of those awards. The fair value of performance-based grants is initially based on the assumption that performance goals will be achieved. If such performance conditions are not met, no compensation cost is recognized and previously-recognized compensation cost is reversed. The following table provides a summary of activity related to restricted stock granted, vested and forfeited: Number of Average Grant Shares Date Fair Value Balance December 31, 2014 $ Granted Vested Forfeited Balance September 30, 2015 $ Included in the table above are performance-based grants of restricted stock totaling 23,408 shares as of September 30, 2015. Stock Options Stock options are granted periodically for the benefit of employees. The fair value of each stock option award is determined on the date of grant using the Black-Scholes option valuation model, which uses assumptions outlined in the table above. Expectations for volatility are based on the historical volatility of the Company’s common stock. The Company estimates forfeiture rates based on historical employee option exercise and termination experience. The Company recognizes share-based compensation costs on a straight line basis over the vesting period of the award, which is typically a period of three to five years. The following table presents the assumptions used in the calculation of the weighted average fair value of options granted during the periods presented: For the Nine Months Ended September 30, 2015 2014 Expected volatility Expected term (years) Dividend yield Risk free rate Weighted-average grant date fair value $ $ The following table provides a summary of activity related to options granted, exercised, and forfeited during the nine months ended September 30, 2015: Options Outstanding Options Number Weighted Average Available for of Shares Exercise Price Grant (1) Balance, December 31, 2014 $ Granted Forfeited Exercised Expired Balance, September 30, 2015 $ (1) Shares available for grant as of December 31, 2014 were from the 2005 Equity Based Compensation Plan, which expired in March 2015. As of September 30, 2015, no further grants can be made from that plan. Shares available for grant as of September 30, 2015 are from the 2015 Equity Incentive Plan, which was approved by the Company’s shareholders in May 2015. The following table provides a summary of the aggregate intrinsic value of options vested and expected to vest and exercisable as of September 30, 2015: September 30, 2015 Weighted Average Weighted Remaining Aggregate Average Contractual Life Intrinsic Shares Exercise Price (Years) Value Vested or expected to vest $ $ Exercisable $ $ The aggregate intrinsic value in the table above represents the total pre-tax intrinsic value, which is subject to change based on the fair market value of the Company’s stock. The aggregate intrinsic value of options exercised was $153 thousand for the nine months ended September 30, 2015.

Shareholders' Equity

Shareholders' Equity	9 Months Ended
	Sep. 30, 2015
Shareholders' Equity
Shareholders' Equity	Note 9. Shareholders’ Equity Regulatory Capital In 2013, the Board of Governors of the Federal Reserve System (“FRB”), the FDIC, and the Office of the Comptroller of the Currency (“OCC”) issued final rules under Basel III (the “Basel III Capital Rules”), establishing a new comprehensive framework for regulatory capital for U.S. banking organizations. These rules implement the Basel Committee’s December 2010 proposed framework, certain provisions of the Dodd-Frank Act, and revise the risk-based capital requirements applicable to bank-holding companies, and depository institutions, including the Company. These rules became effective for the Company on January 1, 2015, and are subject to phase-in periods for certain of their components. The significant changes outlined under the Basel III Capital Rules that are applicable to the Company and the Bank include: · A new Common Equity Tier I (“CET I”) capital measure, with a minimum ratio requirement of 4.5% CET I to risk-weighted assets, and for Prompt Corrective Action purposes 6.5% or greater to generally be considered “well-capitalized.” · A capital conservation buffer in addition to CET I of: 0.625% for 2016; 1.25% for 2017; 1.875% for 2018; and 2.5% for 2019. The capital conservation buffer does not begin phasing-in until January 1, 2016. · Changes to the calculation of risk-weighted assets from the current four categories (0%, 20%, 50% and 100%) to a much broader and risk-sensitive number of categories. · The inclusion of certain changes in accumulated other comprehensive income (“AOCI”) in the determination of regulatory capital measures; however, “non-advanced approaches banking organizations,” including the Company and the Bank may make a one-time permanent election, as of January 1, 2015, to exclude these changes in AOCI from the determination of regulatory capital. The Company, including the Bank, has made this election. · An exclusion from CET I of certain items on a phased-in basis, such as deferred tax assets, and intangible assets. When Basel III Capital Rules are fully phased-in on January 1, 2019, the Company and the Bank will also be required to maintain a 2.5% “capital conservation buffer,” which is designed to absorb losses during periods of economic stress. This capital conservation buffer will be comprised entirely of CET I, and will be in addition to minimum risk-weighted asset ratios outlined under the Basel III Capital Rules. If a banking organization fails to hold capital above minimum capital ratios, including the capital conservation buffer, it will be subject to certain restrictions on capital distributions and discretionary bonus payments. The following table sets forth the Company’s and the Bank’s regulatory capital ratios, including those applicable following the implementation of Basel III as of January 1, 2015: Basel III Pre-Basel III Regulatory Regulatory Standard to be Standard to be Well September 30, 2015 Well December 31, 2014 September 30, 2014 Capitalized (1) Company Bank Capitalized (1) Company Bank Company Bank Ratio Common Equity Tier I capital 6.50% N/A N/A N/A N/A N/A Leverage ratio 5.00% 5.00% Tier I capital 8.00% 6.00% Total risk-based capital 10.00% 10.00% (1) Reflects minimum threshold to be considered “well capitalized” under the Prompt Corrective Action framework, specific to depository institutions. Preferred Stock Under its Amended Articles of Incorporation, the Company is authorized to issue up to 5,000,000 shares of preferred stock, in one or more series, having such voting powers, designations, preferences, rights, qualifications, limitations and restrictions as determined by the Board of Directors. On June 4, 2015, the holder of the Company’s Series C Convertible Perpetual Preferred Stock (“Series C Preferred Stock”) completed the exchange of its remaining 348,697 shares of Series C Preferred Stock for shares of the Company’s common stock on a one-for-one exchange ratio basis. As of September 30, 2015, there were no shares of the Company’s Series C Preferred Stock issued and outstanding. The fair market value of the Company’s common stock was higher than the conversion price of $3.25 per share of the Series C Preferred Stock on the date the Company made a firm commitment to issue the Series C Preferred Stock. As a result, the Series C Preferred Stock was issued with a beneficial conversion feature associated with it. In connection with the exchange of all remaining outstanding shares of the Series C Preferred Stock on June 4, 2015, the Company recorded the remaining beneficial conversion feature of $70 thousand during the second quarter of 2015 through a charge to retained earnings. Cash Dividends On March 2, 2015, the Company paid a cash dividend of $0.05 per share to holders of the Company’s common stock and Series C Preferred Stock as of February 16, 2015. On June 1, 2015, the Company paid a cash dividend of $0.06 per share to holders of the Company’s common stock and Series C Preferred Stock as of May 15, 2015. On August 31, 2015, the Company paid a cash dividend of $0.06 per share to holders of the Company’s common stock as of August 17, 2015. As discussed in Note 13. Subsequent Events, of these condensed consolidated financial statements, on October 28, 2015, the Company’s Board of Directors declared a cash dividend of $0.06 per share, payable on November 30, 2015, to shareholders of the Company’s common stock as of November 16, 2015. During the three and nine months ended September 30, 2014, the Company paid a cash dividend of $0.03 per share to holders of the Company’s common stock and Series C Preferred Stock. Stock Repurchase Program In June 2015, the Company announced it had amended its previously announced plan for the repurchase of up to $5.0 million of its outstanding common stock pursuant to a written plan compliant with Rule 10b5-1 and Rule 10b-18. Repurchase program activity pursuant to the amended plan commenced on July 1, 2015 and will continue in effect until January 31, 2016 or expire earlier upon completion of the repurchase of $5.0 million of the Company’s common stock, as well as under certain other circumstances set forth in the repurchase plan agreement. The Company has no obligation to repurchase any shares under this program, and may suspend or discontinue it at any time. All shares repurchased as part of the repurchase program will be cancelled, and therefore no longer available for reissuance. As of September 30, 2015, the Company had repurchased 55,428 shares of its common stock under this plan at an average price of $7.47 per share. Repurchases of common stock during the first nine months of 2015 totaled 3,696 shares, and were purchased at an average price of $7.52 per share. There were no repurchases of common stock during the third quarter of 2015.

Earnings Per Share

Earnings Per Share	9 Months Ended
	Sep. 30, 2015
Earnings Per Share
Earnings Per Share	Note 10. Earnings Per Share Basic earnings per common share are computed by dividing net income by the weighted-average number of common and participating preferred shares outstanding for the reporting period, including the Series C Preferred Stock. Diluted earnings per common share are computed by dividing net income by the weighted-average number of common shares outstanding over the reporting period, adjusted to include the effect of potentially dilutive common shares. Potentially dilutive common shares are calculated using the treasury stock method and include incremental shares issuable upon exercise of outstanding stock options, and other share-based compensation. The computation of diluted earnings per common share excludes the impact of the assumed exercise or issuance of securities that would have an anti-dilutive effect. The following tables set forth number of shares used in the calculation of both basic and diluted earnings per common share: For the Three Months Ended September 30, 2015 2014 Net Net Income Shares Income Shares (dollars in thousands, except per share data) Net income $ $ Accretion on preferred stock - - Net income available to common shareholders $ $ Weighted average shares outstanding Basic earnings per common share $ $ Dilutive effect of share-based compensation awards Weighted average diluted shares outstanding Diluted earnings per common share $ $ For the Nine Months Ended September 30, 2015 2014 Net Net Income Shares Income Shares (dollars in thousands, except per share data) Net income $ $ Accretion on preferred stock - Net income available to common shareholders $ $ Weighted average shares outstanding Basic earnings per common share $ $ Dilutive effect of share-based compensation awards Weighted average diluted shares outstanding Diluted earnings per common share $ $ For the three and nine months ended September 30, 2015 and 2014, common stock equivalents totaling approximately 126,000 shares and 160,000 shares and 35,000 shares and 114,000 shares respectively, were excluded from the calculation of diluted earnings per share, as their impact would be anti-dilutive.

Commitments and Contingencies

Commitments and Contingencies	9 Months Ended
	Sep. 30, 2015
Commitments and Contingencies.
Commitments and Contingencies	Note 11. Commitments and Contingencies In the normal course of business, various claims and lawsuits are brought by and against the Company. At September 30, 2015, the Company does not believe the disposition of all pending or threatened proceedings will have a material effect on the Company’s condensed consolidated financial statements. Commitments to Extend Credit In the normal course of business, the Bank enters into financial commitments to meet the financing needs of its customers. These financial commitments include commitments to extend credit and standby letters of credit. Those instruments involve, to varying degrees, elements of credit and interest rate risk not recognized in the Company’s condensed consolidated financial statements. Commitments to extend credit are agreements to lend to a customer as long as there is no violation of any condition established in the contract. Standby letters of credit are conditional commitments to guarantee the performance of a Bank customer to a third party. Since many of the commitments and standby letters of credit are expected to expire without being drawn upon, the total amounts do not necessarily represent future cash requirements. The Bank’s management evaluates each customer’s credit worthiness on a case-by-case basis, and determines the amount of collateral deemed adequate to secure the loan, if collateral security is determined to be necessary for the particular loan. The Bank’s exposure to loan loss in the event of nonperformance on commitments to extend credit and standby letters of credit is represented by the contractual amount of those instruments. The Bank uses the same credit policies in making commitments as it does for loans reflected in the Company’s condensed consolidated financial statements. As of September 30, 2015, and December 31, 2014, the Company had the following outstanding financial commitments: September 30, December 31, 2015 2014 (dollars in thousands) Commitme nts to extend credit $ $ Standby letters of credit (1) Total commitments and standby letters of credit $ $ (1) Includes a standby letter of credit to one customer in the amount of $10.4 million at September 30, 2015 and December 31, 2014. Commitments to extend credit and standby letters of credit are made at both fixed and variable rates of interest. At September 30, 2015 and December 31, 2014, the Company had $26.3 million and $35.7 million in fixed rate commitments, and $256.7 million and $217.5 million in variable rate commitments.

Regulatory Matters

Regulatory Matters	9 Months Ended
	Sep. 30, 2015
Regulatory Matters
Regulatory Matters	Note 12. Regulatory Matters BSA Consent Order On November 5, 2014, the Bank entered into a Stipulation to the Issuance of a Consent Order with the Federal Deposit Insurance Corporation (“FDIC”) and the California Department of Business Oversight (“DBO”), consenting to the issuance of a consent order (“the BSA Consent Order”) relating to identified deficiencies in the Bank’s centralized Bank Secrecy Act and anti-money laundering compliance program, which is designed to comply with the requirements of the Bank Secrecy Act, the USA Patriot Act of 2001 and related anti-money laundering regulations (collectively, the “BSA/AML Requirements”). Per the BSA Consent Order, the Bank must review, update and implement an enhanced Bank Secrecy Act/Anti-Money Laundering (“BSA/AML”) risk assessment process based on the 2010 Federal Financial Institutions Examination Council BSA/AML Examination Manual. Some of the areas highlighted in the BSA Consent Order include the requirements to: i) enhance customer due-diligence procedures; ii) improve the enhanced due diligence analysis for high-risk customers; iii) ensure the proper identification and reporting of suspicious activity; iv) address and correct the noted violations of law; v) ensure that there is sufficient and qualified staff; and vi) ensure that all staff are properly trained to carry out the BSA/AML programs. Certain activities, including expansionary activities, that otherwise require regulatory approval will likely be impeded while the BSA Consent Order remains outstanding. The Company continues to make progress in addressing the issues identified in the BSA Consent Order that was entered into with its regulators in November of 2014. However, the Company still has additional work to do in order to fully remediate the issues identified in the BSA Consent Order. Compliance and resolution of the BSA Consent Order will ultimately be determined by the FDIC and DBO.

Subsequent Events

Subsequent Events	9 Months Ended
	Sep. 30, 2015
Subsequent Events
Subsequent Events	Note 13. Subsequent Events Dividend Declaration On October 28, 2015, the Company’s Board of Directors declared a cash dividend of $0.06 per share, payable on November 30, 2015, to shareholders of the Company’s common stock as of November 16, 2015.

Summary of Significant Accoun22

Summary of Significant Accounting Policies (Policies)	9 Months Ended
	Sep. 30, 2015
Summary of Significant Accounting Policies
Investment in Non-Consolidated Subsidiaries	Investment in Non-Consolidated Subsidiaries The Company accounts for its investment in Heritage Oaks Capital Trust II, Mission Community Capital Trust I, and Santa Lucia Bancorp (CA) Capital Trust, as unconsolidated subsidiaries using the equity method of accounting, as the Company is not the primary beneficiary of the trust. Mission Community Capital Trust I and Santa Lucia Bancorp (CA) Capital Trust were acquired as part of the acquisition of Mission Community Bancorp on February 28, 2014. The sole purpose of each of these trusts is for the issuance of trust preferred securities.
Reclassifications	Reclassifications Certain items in the prior year financial statements were reclassified to conform to the current presentation. Reclassifications had no effect on prior year net income or shareholders’ equity.
Use of Estimates in the Preparation of Condensed Consolidated Financial Statements	Use of Estimates in the Preparation of Condensed Consolidated Financial Statements The preparation of condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”), and general practices within the banking industry require management to make estimates and assumptions. These estimates and assumptions affect the reported amounts of assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates.
Allowance for Loan and Lease Losses	Significant Accounting Policies Update The significant accounting policies that the Company applies are detailed in Note 1. Summary of Significant Accounting Policies, of the Company’s 2014 Annual Report filed on Form 10-K. Changes to accounting policies during the nine months ended September 30, 2015 are discussed below: During the third quarter of 2015, the Company made a specific enhancement to its methodology for determining the general reserve component of the allowance for loan and lease losses (“ALLL”). This enhancement related specifically to the methodology used to calculate the loss rates for loan risk grades within each loan type in the determination of the general reserve component of the ALLL. The enhanced methodology uses more granular loan level data to calculate loss rates for specific loan grades within each loan type, allowing for more detailed loan migration analysis, and the ability to determine more precise average loss rates for each loan risk grade. Although the total general reserve component of the ALLL for each loan type and portfolio segment is still based on total average historical losses for their respective loan types, management believes the allocation of the ALLL to each loan risk grade, within each loan type and the evaluation of the loss emergence period has become more precise under this methodology enhancement. The implementation of the ALLL model enhancements did not result in a required increase or decrease in the balance of the ALLL, or a material impact to the overall allocation of the ALLL. The ALLL model enhancement has allowed the Company to apply more precision in determining loss rates for specific loan grades within each loan type. The section of the accounting policy for the ALLL, which was updated for this methodology enhancement is illustrated below: Allowance for Loan and Lease Losses The Company manages credit risk not only through extensive risk analyses performed prior to a loan’s approval, but also through the ongoing monitoring of loans within the portfolio, and more specifically certain types of loans that generally involve a greater degree of risk, such as commercial real estate, commercial lines of credit, agriculture, and construction/land loans. The Company monitors loans in the portfolio through an exhaustive internal process, at least quarterly, as well as with the assistance of independent loan reviews. These reviews generally not only focus on problem loans, but also internally rated “pass” credits within certain pools of loans that may be expected to experience stress due to economic conditions. This process allows the Company to validate credit risk grade ratings, underwriting structure, and the Company’s estimated exposure in the current economic environment as well as enhance communications with borrowers where necessary in an effort to mitigate potential future losses. All significant problem loans are analyzed in detail at least quarterly, in order to properly estimate potential exposure to loss associated with these loans in a timely manner. Each segment of loans in the portfolio possesses varying degrees of risk, based on, among other things, the type of loan, the purpose of the loan, the type of collateral securing the loan, and the sensitivity the borrower has to changes in certain external factors such as economic conditions. The following provides a summary of the risks associated with various segments of the Company’s loan portfolio, which are factors management regularly considers when evaluating the adequacy of the ALLL: " Real estate secured loans – consist primarily of loans secured by commercial real estate, multi-family, farmland, and 1 to 4 family residential properties. As the majority of this segment is comprised of commercial real estate loans, risks associated with this segment lie primarily within that loan type. Adverse economic conditions may result in a decline in business activity and increased vacancy rates for commercial properties. These factors, in conjunction with a decline in real estate prices, may expose the Company to the potential for losses if a borrower cannot continue to service the loan with operating revenues, and the value of the property has declined to a level such that it no longer fully covers the Company’s recorded investment in the loan. " Construction and land – although construction and land loans generally possess a higher inherent risk of loss than other loans, improvements in the mix, collateral and nature of loans help to mitigate risks within this segment of the portfolio. Risk arises from the necessity to complete projects within specified cost and time limits. Trends in the construction industry may also impact the credit quality of these loans, as demand drives construction activity. In addition, trends in real estate values significantly impact the credit quality of these loans, as property values determine the economic viability of future construction projects. " Commercial and industrial – consist primarily of commercial and industrial loans (business lines of credit), agriculture loans, and other commercial purpose loans. Repayment of commercial and industrial loans is generally provided from the cash flows of the related business to which the loan was made. Adverse changes in economic conditions may result in a decline in business activity, which can impact a borrower’s ability to continue to make scheduled payments. The risk of repayment of agriculture loans arises largely from factors beyond the control of the Company or the related borrower, such as commodity prices, general weather conditions, and drought. " Consumer – the consumer loan portfolio is comprised primarily of a large number of small loans with scheduled amortization over a specific period. The majority of consumer loans include revolving credit plans, installment loans and credit card balances. Weakened economic conditions may result in an increased level of delinquencies within this segment, as economic pressures may impact the capacity of such borrowers to repay their obligations. ALLL Model Methodology The ALLL is maintained at a level which, in management’s judgment, is appropriate to absorb probable credit losses inherent in the loans within the loan portfolio as of the balance sheet date. The amount of the ALLL is based on management’s evaluation of the collectability of the loan portfolio, including the nature and volume of the portfolio, credit concentrations, trends in historical loss experience, the level of certain classified balances and specific impaired loans, and economic conditions and the related impact on specific borrowers and industry groups. The ALLL is increased by provisions for loan and lease losses, which are charged to earnings and reduced (or potentially increased) by charge-offs, net of recoveries. Changes in the ALLL relating to impaired loans, including troubled debt restructurings (“TDRs”), are charged or credited to the provision for loan and lease losses. Because of uncertainties inherent in the estimation process, management’s estimate of probable credit losses inherent in the loan portfolio and the related allowance may change. The process in which management determines the appropriate level of the ALLL involves the exercise of considerable judgment and the use of estimates. While management utilizes its best judgment and all available information in determining the adequacy of the ALLL, the ultimate adequacy of the ALLL is dependent upon a variety of factors beyond the Company’s control, including but not limited to, the performance of the loan portfolio, changes in current and future economic conditions and the view of regulatory agencies regarding the level of classified assets. Weakness in economic conditions and any other factor that may adversely affect credit quality and or that may result in higher levels of: past due and non-accruing loans, loan defaults, and or increased loan charge-offs, may require additional provisions for loan and lease losses in future periods and a higher balance in the Company’s ALLL. The ALLL, as more fully described below, is comprised of three components: general reserves, specific loan reserves, and a reserve for purchased credit impaired (“PCI”) loans. General Reserves – The general reserve component of the ALLL, which is not attributable to loans specifically identified as impaired, is determined through a two-step process. First a quantitative allocation is determined by pooling performing loans by collateral type and purpose. These pools of loans are then further segmented by an internal risk grading system that classifies loans as: pass, special mention, substandard and doubtful. The Company’s risk grade system allows management, among other things, to identify the risk associated with each loan, and to provide a basis for estimating credit losses inherent in the portfolio. Risk grades are generally assigned based on information concerning the borrower and the strength of the collateral. Risk grades are reviewed regularly by the Company’s credit committee and are scrutinized by independent loan reviews performed semi-annually, as well as by regulatory agencies during scheduled examinations. Once credit risk grades have been assigned, estimated loss rates are then applied to each segment according to risk grade to determine the amount of the general portfolio allocation. Estimated loss rates are determined through a migration analysis of historical losses for each segment of the loan portfolio, based on the Company’s prior experience with such loans, and the use of detailed loan level data, encompassing historical losses and average balance information for each loan type and risk grade. The following provides brief definitions for credit risk grade ratings assigned to loans in the portfolio: " Pass – credits that have strong credit quality with adequate collateral or secondary source of repayment and little existing or known weaknesses. However, pass may include credits with exposure to certain potential factors that may adversely impact the credit, if they materialize, resulting in these credits being put on a watch list to monitor more closely than other pass rated credits. Such factors may be credit / relationship specific or general to an entire industry. " Special Mention – credits that have potential weaknesses that deserve management’s close attention. If not corrected, these potential weaknesses may result in deterioration of the repayment prospects for the credit at some future date. " Substandard – credits that have a defined weakness or weaknesses which may jeopardize the orderly liquidation of the loan through cash flows, making it likely that repayment may have to come from some other source, such as the liquidation of collateral. The Company is more likely to incur losses on substandard credits if the weakness or weaknesses identified in the credit are not corrected. " Doubtful – credits that possess the characteristics of a substandard credit, but because of certain existing deficiencies related to the credit, full collection is highly questionable. The probability of incurring some loss on such credits is high, but because of certain important and reasonably specific pending factors which may work to the advantage of strengthening the credit, charge-off is deferred until such time as the Company becomes reasonably certain that certain pending factors related to the credit will no longer provide some form of benefit. The second component of the general reserve allocation of the ALLL is the qualitative allocation, and is determined by estimates the Company makes in regard to certain internal and external factors that may have either a positive or negative impact on the overall losses inherent in the loan portfolio. Internal factors include trends in credit quality of the loan portfolio, the existence and the effects of concentrations, the composition and volume of the loan portfolio and the scope and frequency of the loan review process as well as any other factor determined by management to have an impact on the credit quality of the loan portfolio. External factors include local, state and national economic and business conditions, as well as the estimated impact that environmental factors may have on certain segments of the loan portfolio, such as drought. While management regularly reviews the estimated impact these internal and external factors are expected to have on the loan portfolio, there can be no assurance that an adverse change in any one or combination of these factors will not be in excess of management’s expectations.
Recent Accounting Guidance Adopted	Recent Accounting Guidance Adopted In August 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-14 Receivables – Troubled Debt Restructurings by Creditors (Subtopic 310-40), Classification of Certain Government-Guaranteed Mortgage Loans upon Foreclosure . This update addresses classification of government-guaranteed mortgage loans, including those where guarantees are offered by the Federal Housing Administration (“FHA”), the U.S. Department of Housing and Urban Development (“HUD”), and the U.S. Department of Veterans Affairs (“VA”). Although current accounting guidance stipulates proper measurement and classification in situations where a creditor obtains from a debtor, assets in satisfaction of a receivable (such as through foreclosure), current guidance does not specify how to measure and classify foreclosed mortgage loans that are government-guaranteed. Under the provisions of this update, a creditor would derecognize a mortgage loan that has been foreclosed upon, and recognize a separate receivable if the following conditions are met: (1) the loan has a government guarantee that is not separable from the loan before foreclosure, (2) at the time of foreclosure, the creditor has the intent to convey the real estate property to the guarantor and make a claim on the guarantee, and the creditor has the ability to recover under that claim, (3) at the time of foreclosure, any amount of the claim that is determined on the basis of the fair value of the real estate is fixed. The amendments within this update are effective for interim and annual periods, beginning after December 15, 2014. The adoption of this update did not have a material impact on the Company’s consolidated financial statements. In January 2014, the FASB issued ASU No. 2014-04, Receivables – Troubled Debt Restructurings by Creditors . This ASU provides clarification that an in substance repossession or foreclosure occurs, and a creditor is considered to have received physical possession of residential real estate property collateralizing a consumer mortgage loan, upon either (1) the creditor obtaining legal title to the residential real estate property upon completion of a foreclosure or (2) the borrower conveying all interest in the residential real estate property to the creditor to satisfy that loan through completion of a deed in lieu of foreclosure or through a similar legal agreement. Additionally, the amendments require interim and annual disclosure of both (1) the amount of foreclosed residential real estate property held by the creditor and (2) the recorded investment in consumer mortgage loans collateralized by residential real estate property that are in the process of foreclosure according to local requirements of the applicable jurisdiction. The amendments in this ASU are effective for public business entities for interim and annual periods, beginning after December 15, 2014. The adoption of this update did not have a material impact on the Company’s consolidated financial statements.
Recent Accounting Guidance Not Yet Effective	Recent Accounting Guidance Not Yet Effective In September, 2015, the FASB issued ASU No. 2015-16, Simplifying the Accounting for Measurement Period Adjustments (Topic 805). This ASU eliminates the requirement to restate prior period financial statements for measurement period adjustments to assets acquired and liabilities assumed in a business combination. The new guidance under this update requires the cumulative impact of measurement period adjustments be recognized in the period the adjustment is determined. This update does not change what constitutes a measurement period adjustment, nor does it change the length of the measurement period. The new standard is effective for interim annual periods beginning after December 15, 2015 and should be applied prospectively to measurement period adjustments that occur after the effective date. The Company does not expect the adoption of this update to have a material impact on the Company’s consolidated financial statements. In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) . This update requires an entity to recognize revenue as performance obligations are met, in order to reflect the transfer of promised goods or services to customers in an amount that reflects the consideration the entity is entitled to receive for those goods or services. The following steps are applied in the updated guidance: (1) identify the contract(s) with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to the performance obligations in the contract; and (5) recognize revenue when, or as, the entity satisfies a performance obligation. The amendments within this update are effective for the quarter ending March 31, 2018. The Company is currently in the process of evaluating the impact of the adoption of this update, but does not expect a material impact on the Company’s consolidated financial statements.

Business Combination (Table)

Business Combination (Table)	9 Months Ended
	Sep. 30, 2015
Business Combination
Schedule of unaudited pro forma financial information	Three Months Ended September 30, 2014 Nine Months Ended September 30, 2014 (dollars in thousands, except per share data) Net interest income $ $ Provision for loan and lease losses - - Non-interest income Non-interest expense Income before income taxes Income tax expense Net income $ $ Earnings Per Common Share Basic $ $ Diluted $ $

Fair Value of Assets and Liab24

Fair Value of Assets and Liabilities (Tables)	9 Months Ended
	Sep. 30, 2015
Fair Value of Assets and Liabilities
Summary of the assets the Company measures at fair value on a recurring basis	Fair Value Measurements at the End of the Reporting Period Using As of Quoted Prices in Significant Other Significant September 30, 2015 Active Markets for Observable Unobservable Assets At Identical Assets Inputs Inputs Fair Value (Level 1) (Level 2) (Level 3) (dollars in thousands) Assets Obligations of U.S. government agencies $ $ - $ $ - Mortgage backed securities: U.S government sponsored entities and agencies - - Non-agency - - State and municipal securities - - Asset backed securities - - Other investments - - Total assets measured on a recurring basis $ $ $ $ - Fair Value Measurements at the End of the Reporting Period Using As of Quoted Prices in Significant Other Significant December 31, 2014 Active Markets for Observable Unobservable Assets At Identical Assets Inputs Inputs Fair Value (Level 1) (Level 2) (Level 3) (dollars in thousands) Assets Obligations of U.S. government agencies $ $ - $ $ - Mortgage backed securities: U.S government sponsored entities and agencies - - Non-agency - - State and municipal securities - - Asset backed securities - - Total assets measured on a recurring basis $ $ - $ $ -
Summary of assets the Company measures at fair value on a non-recurring basis	Fair Value Measurements at the End of the Reporting Period Using As of Quoted Prices in Significant Other Significant September 30, 2015 Active Markets for Observable Unobservable Year To Assets At Identical Assets Inputs Inputs Date Losses Fair Value (Level 1) (Level 2) (Level 3) (Recoveries) (dollars in thousands) Assets Impaired loans: Land $ $ - $ - $ $ Total assets measured on a non-recurring basis $ $ - $ - $ $ Fair Value Measurements at the End of the Reporting Period Using As of Quoted Prices in Significant Other Significant December 31, 2014 Active Markets for Observable Unobservable Year To Assets At Identical Assets Inputs Inputs Date Losses Fair Value (Level 1) (Level 2) (Level 3) (Recoveries) (dollars in thousands) Assets Impaired loans: Commercial real estate $ $ - $ - $ $ Land - - Total assets measured on a non-recurring basis $ $ - $ - $ $
Summary of the estimated fair value of financial instruments	Fair Value Measurements at the End of the Reporting Period Using As of Quoted Prices in Significant Other Significant September 30, 2015 Active Markets for Observable Unobservable Carrying Identical Assets Inputs Inputs Amount (Level 1) (Level 2) (Level 3) Fair Value (dollars in thousands) Assets Cash and cash equivalents $ $ $ - $ - $ Investment securities available for sale - Federal Home Loan Bank stock - - - N/A Loans receivable, net of deferred fees and costs - - Loans held for sale - - Accrued interest receivable - Liabilities Non-interest bearing deposits - - Interest bearing deposits - - Federal Home Loan Bank advances - - Junior subordinated debentures - - Accrued interest payable - - Fair Value Measurements at the End of the Reporting Period Using As of Quoted Prices in Significant Other Significant December 31, 2014 Active Markets for Observable Unobservable Carrying Identical Assets Inputs Inputs Amount (Level 1) (Level 2) (Level 3) Fair Value (dollars in thousands) Assets Cash and cash equivalents $ $ $ - $ - $ Investment securities available for sale - - Federal Home Loan Bank stock - - - N/A Loans receivable, net of deferred fees and costs - - Loans held for sale - - Accrued interest receivable - Liabilities Non-interest bearing deposits - - Interest bearing deposits - - Federal Home Loan Bank advances - - Junior subordinated debentures - - Accrued interest payable - -
Summary of off-balance sheet instruments	September 30, 2015 December 31, 2014 Notional Cost to Cede Notional Cost to Cede Amount or Assume Amount or Assume (dollars in thousands) Off-balance sheet instruments, commitments to extend credit and standby letters of credit $ $ $ $

Investment Securities (Tables)

Investment Securities (Tables)	9 Months Ended
	Sep. 30, 2015
Investment Securities
Schedule of amortized cost and fair values of the Company's investment securities, all of which are reported as available for sale	September 30, 2015 Gross Gross Amortized Unrealized Unrealized Fair Cost Gains Loss Value (dollars in thousands) Obligations of U.S. government agencies $ $ $ $ Mortgage backed securities U.S. government sponsored entities and agencies Non-agency State and municipal securities Asset backed securities - Other investments - Total available for sale securities $ $ $ $ December 31, 2014 Gross Gross Amortized Unrealized Unrealized Fair Cost Gains Loss Value (dollars in thousands) Obligations of U.S. government agencies $ $ $ $ Mortgage backed securities U.S. government sponsored entities and agencies Non-agency State and municipal securities Asset backed securities - Total available for sale securities $ $ $ $
Summary of investment securities in an unrealized loss position	September 30, 2015 Less Than Twelve Months Twelve Months or More Total Fair Unrealized Fair Unrealized Fair Unrealized Value Loss Value Loss Value Loss (dollars in thousands) Obligations of U.S. government agencies $ $ $ - $ - $ $ Mortgage backed securities U.S. government sponsored entities and agencies Non-agency State and municipal securities Asset backed securities - - Other investments - - Total $ $ $ $ $ $ December 31, 2014 Less Than Twelve Months Twelve Months or More Total Fair Unrealized Fair Unrealized Fair Unrealized Value Loss Value Loss Value Loss (dollars in thousands) Obligations of U.S. government agencies $ $ $ $ $ $ Mortgage backed securities U.S. government sponsored entities and agencies Non-agency State and municipal securities Asset backed securities - - Total $ $ $ $ $ $
Schedule of proceeds from the sales and calls of securities and the associated gains and losses	For Three Months Ended For Nine Months Ended September 30, September 30, 2015 2014 2015 2014 (dollars in thousands) Proceeds $ $ $ $ Gross gains Gross losses -
Schedule of amortized cost and fair values maturities of available for sale investment securities	September 30, 2015 December 31, 2014 Amortized Amortized Cost Fair Value Cost Fair Value (dollars in thousands) Due one year or less $ $ $ $ Due after one year through five years Due after five years through ten years Due after ten years Total $ $ $ $
Summary of earnings on both taxable and tax-exempt investment securities	For the Three Months Ended For the Nine Months Ended September 30, September 30, 2015 2014 2015 2014 (dollars in thousands) Taxable earnings on investment securities Obligations of U.S. government agencies $ $ $ $ Mortgage backed securities State and municipal securities Corporate debt securities - - - Asset backed securities Non-taxable earnings on investment securities State and municipal securities Total $ $ $ $

Loans and Allowance for Loan 26

Loans and Allowance for Loan and Lease Losses (Tables)	9 Months Ended
	Sep. 30, 2015
Loans and Allowance for Loan and Lease Losses
Summary of outstanding loan balances	September 30, 2015 December 31, 2014 Non-PCI PCI Non-PCI PCI Loans Loans Total Loans Loans Total (dollars in thousands) Real Estate Secured Commercial $ $ $ $ $ $ Residential 1 to 4 family Farmland - Multi-family residential - - Construction and land Home equity lines of credit - - Total real estate secured Commercial Commercial and industrial Agriculture Other - - - - Total commercial Consumer - - Total gross loans held for investment Net deferred loan fees - - Allowance for loan and lease losses - Total net loans held for investment $ $ $ $ $ $ Loans held for sale $ $ - $ $ $ - $
Summary of the recorded investment in non-PCI and PCI impaired loans	For the Three Months Ended For the Nine Months Ended September 30, 2015 September 30, 2015 September 30, 2015 Unpaid Specific Average Interest Average Interest Recorded Principal Allowance for Recorded Income Recorded Income Investment Balance Impaired Loans Investment Recognized Investment Recognized (dollars in thousands) Non-PCI Loans Without Related Allowance Real Estate Secured Commercial $ $ $ - $ $ $ $ Construction and land - Residential 1 to 4 family - Farmland - Home equity lines of credit - - - Commercial Commercial and industrial - Agriculture - Consumer - Total - With Related Allowance Real Estate Secured Construction and land - - Commercial - - Commercial Commercial and industrial Total Total Non-PCI impaired loans $ $ $ $ $ $ $ For the Three Months Ended For the Nine Months Ended September 30, 2015 September 30, 2015 September 30, 2015 Unpaid Specific Average Interest Average Interest Recorded Principal Allowance for Recorded Income Recorded Income Investment Balance Impaired Loans Investment Recognized Investment Recognized (dollars in thousands) PCI Loans Without Related Allowance Real Estate Secured Commercial $ $ $ - $ $ $ $ Residential 1 to 4 family - Construction and land - Commercial Agriculture - Commercial and industrial - Total - With Related Allowance Real Estate Secured Commercial Construction and land Commercial Commercial and industrial Total Total PCI loans $ $ $ $ $ $ $ For the Three Months Ended For the Nine Months Ended December 31, 2014 September 30, 2014 September 30, 2014 Unpaid Specific Average Interest Average Interest Recorded Principal Allowance for Recorded Income Recorded Income Investment Balance Impaired Loans Investment Recognized Investment Recognized (dollars in thousands) Non-PCI Loans Without Related Allowance Real Estate Secured Commercial $ $ $ - $ $ $ $ Construction and land - Farmland - Residential 1 to 4 family - Home equity lines of credit - - - Commercial Commercial and industrial - Agriculture - Consumer - Total - With Related Allowance Real Estate Secured Construction and land Commercial - - Commercial Commercial and industrial Total Total Non-PCI impaired loans $ $ $ $ $ $ $ For the Three Months Ended For the Nine Months Ended December 31, 2014 September 30, 2014 September 30, 2014 Unpaid Specific Average Interest Average Interest Recorded Principal Allowance for Recorded Income Recorded Income Investment Balance Impaired Loans Investment Recognized Investment Recognized (dollars in thousands) PCI Loans Without Related Allowance Real Estate Secured Commercial $ $ $ - $ $ $ $ Farmland - Construction and land - Residential 1 to 4 family - Home equity lines of credit - - - Commercial Agriculture - Commercial and industrial - Total PCI loans $ $ $ - $ $ $ $
Summary of loans classified as TDRs	September 30, 2015 December 31, 2014 Accrual Non-accrual Total Accrual Non-accrual Total (dollars in thousands) Non-PCI Loans Real Estate Secured Commercial $ $ $ $ $ $ Construction and land Residential 1 to 4 family Farmland - - Commercial Commercial and industrial Agriculture - - Consumer - Total non-PCI loans PCI Loans Real Estate Secured Commercial - Construction and land - - - - Commercial Commercial and industrial Total PCI loans Total TDRs $ $ $ $ $ $
Schedule of loan modifications resulted in TDRs for non-PCI and PCI loans	For the Three Months Ended For the Nine Months Ended September 30, 2015 September 30, 2015 Pre-Modification Post-Modification Pre-Modification Post-Modification Outstanding Outstanding Outstanding Outstanding Number Recorded Recorded Number Recorded Recorded of TDRs Investment Investment of TDRs Investment Investment (dollars in thousands) Non-PCI Loans Real Estate Secured Residential 1 to 4 family $ $ $ $ Farmland Commercial - - - Construction and land - - - Commercial Commercial and industrial Agriculture Consumer PCI Loans Real Estate Secured Commercial Construction and land - - - Commercial Commercial and industrial Total $ $ $ $ For the Three Months Ended For the Nine Months Ended September 30, 2014 September 30, 2014 Pre-Modification Post-Modification Pre-Modification Post-Modification Outstanding Outstanding Outstanding Outstanding Number Recorded Recorded Number Recorded Recorded of TDRs Investment Investment of TDRs Investment Investment (dollars in thousands) Non-PCI Loans Real Estate Secured Construction and land $ $ $ $ Commercial - - - Commercial Commercial and industrial Agriculture - - - Consumer - - - PCI Loans Real Estate Secured Commercial - - - Commercial Commercial and industrial - - - Total $ $ $ $
Schedule of loans that were modified as troubled debt restructurings within the twelve months prior to the balance sheet date indicated for which there was a payment default	For the Three Months Ended For the Nine Months Ended September 30, 2015 September 30, 2015 Number of TDRs Recorded Investment Number of TDRs Recorded Investment Non-PCI Loans (dollars in thousands) Commercial Commercial and industrial - $ - $ Total - $ - $ For the Three Months Ended For the Nine Months Ended September 30, 2014 September 30, 2014 Number of TDRs Recorded Investment Number of TDRs Recorded Investment Non-PCI Loans (dollars in thousands) Commercial Commercial and industrial - $ - $ Total - $ - $
Schedule of loan portfolio by the Company's internal risk grading system	September 30, 2015 Credit Risk Grades Special Pass Mention Substandard Doubtful Total (dollars in thousands) Non-PCI Loans Real Estate Secured Commercial $ $ $ $ - $ Residential 1 to 4 family - - Farmland - Multi-family residential - - Construction and land - Home equity lines of credit - - Commercial Commercial and industrial - Agriculture - Other - - - - - Consumer - - Total non-PCI loans - PCI Loans Real Estate Secured Commercial - - Construction and land - Residential 1 to 4 family - - Commercial Agriculture - - - Commercial and industrial - Total PCI loans - Total loans held for investment $ $ $ $ - $ December 31, 2014 Credit Risk Grades Special Pass Mention Substandard Doubtful Total (dollars in thousands) Non-PCI Loans Real Estate Secured Commercial $ $ $ $ - $ Residential 1 to 4 family - Farmland - Multi-family residential - - Home equity lines of credit - - Construction and land - - Commercial Commercial and industrial Agriculture - Other - - - Consumer - - Total non-PCI loans PCI Loans Real Estate Secured Commercial - Farmland - - - Construction and land - - Residential 1 to 4 family - - - Commercial Agriculture - - - Commercial and industrial Total PCI loans Total loans held for investment $ $ $ $ $
Summary of the aging of loans held for investment	September 30, 2015 Days Past Due 90+ and Still Non- Current 30-59 60-89 Accruing Accruing Total (dollars in thousands) Non-PCI Loans Real Estate Secured Commercial $ $ $ - $ - $ $ Residential 1 to 4 family - - - Farmland - - - Multi-family residential - - - - Construction and land - - - Home equity lines of credit - - - Commercial - Commercial and industrial - - Agriculture - - - - Other - - - - - - Consumer - - - Total non-PCI loans - - PCI Loans Real Estate Secured Commercial - - - Land - - - - Residential 1 to 4 family - - - - Commercial Agriculture - - - - Commercial and industrial - - - Total PCI loans - - - Total loans held for investment $ $ $ - $ - $ $ December 31, 2014 Days Past Due 90+ and Still Non- Current 30-59 60-89 Accruing Accruing Total (dollars in thousands) Non-PCI Loans Real Estate Secured Commercial $ $ - $ - $ - $ $ Residential 1 to 4 family - - - Farmland - - - - Multi-family residential - - - - Construction and land - - - Home equity lines of credit - - - Commercial Commercial and industrial - - Agriculture - - - Other - - - - Consumer - Total non-PCI loans - PCI Loans Real Estate Secured Commercial - - - - Farmland - - - - Construction and land - - - - Residential 1 to 4 family - - - - Commercial Agriculture - - - - Commercial and industrial - - - Total PCI loans - - - Total loans held for investment $ $ $ $ - $ $
Schedule of carrying amount and unpaid principal balance of purchased credit impaired loans	September 30, 2015 December 31, 2014 Unpaid Principal Balance Carrying Amount Unpaid Principal Balance Carrying Amount (dollars in thousands) Real Estate Secured Commercial $ $ $ $ Construction and land Residential 1 to 4 family Farmland - - Total real estate secured Commercial Commercial and industrial Agriculture Total commercial Total PCI loans $ $ $ $
Schedule of accretable yield, or income expected to be collected	For the Nine Months Ended September 30, 2015 (dollars in thousands) Balance, December 31, 2014 $ Accretion of income Reclassifications from nonaccretable difference (1) Balance, September 30, 2015 $ (1) Reclassification from nonaccretable difference is attributable to positive changes in expected future cash flows on certain PCI loans.
Summary of the activity in the allowance for loan and lease losses by portfolio segment	For the Three Months Ended September 30, 2015 Balance June 30, 2015 Charge-offs Recoveries Provision for Loan and Lease Losses Balance September 30, 2015 (dollars in thousands) Other real estate secured $ $ - $ $ $ Commercial Construction and land - Consumer Unallocated - Total $ $ $ $ - $ For the Nine Months Ended September 30, 2015 Balance December 31, 2014 Charge-offs Recoveries Provision for Loan and Lease Losses Balance September 30, 2015 (dollars in thousands) Other real estate secured $ $ $ $ $ Commercial Construction and land Consumer Unallocated - Total $ $ $ $ - $ For the Three Months Ended September 30, 2014 Balance June 30, 2014 Charge-offs Recoveries Provision for Loan and Lease Losses Balance September 30, 2014 (dollars in thousands) Other real estate secured $ $ $ $ $ Commercial - Construction and land - Consumer Unallocated Total $ $ $ $ - $ For the Nine Months Ended September 30, 2014 Balance December 31, 2013 Charge-offs Recoveries Provision for Loan and Lease Losses Balance September 30, 2014 (dollars in thousands) Other real estate secured $ $ $ $ $ Commercial Construction and land - Consumer Unallocated Total $ $ $ $ - $
Schedule of allowance for loan and lease losses and the recorded investment in loans by impairment methodology	September 30, 2015 Allowance for Loan and Lease Losses Recorded Investment in Loans Individually Evaluated for Impairment Collectively Evaluated for Impairment Loans Acquired with Deteriorated Credit Quality Individually Evaluated for Impairment Collectively Evaluated for Impairment Loans Acquired with Deteriorated Credit Quality (dollars in thousands) Other real estate secured $ $ $ $ $ $ Commercial Construction and land Consumer - - - Unallocated - - - Total $ $ $ $ $ $ December 31, 2014 Allowance for Loan and Lease Losses Recorded Investment in Loans Individually Evaluated for Impairment Collectively Evaluated for Impairment Loans Acquired with Deteriorated Credit Quality Individually Evaluated for Impairment Collectively Evaluated for Impairment Loans Acquired with Deteriorated Credit Quality (dollars in thousands) Other real estate secured $ $ $ - $ $ $ Commercial - Construction and land - Consumer - - - Unallocated - - Total $ $ $ - $ $ $

Goodwill and Other Intangible27

Goodwill and Other Intangible Assets (Tables)	9 Months Ended
	Sep. 30, 2015
Goodwill and Other Intangible Assets
Summary of the gross carrying amount, accumulated amortization and net carrying amount of CDI	September 30, 2015 Gross Carrying Accumulated Net Carrying Amount Amortization Amount (dollars in thousands) Core deposit intangibles $ $ $
Summary of an estimate for future amortization expense	September 30, 2015 Beginning Balance Estimated Remaining Amortization Projected Ending Balance (dollars in thousands) Period Year 2015 $ $ $ Year 2016 Year 2017 Year 2018 Year 2019 Year 2020

Share-based Compensation Plans

Share-based Compensation Plans (Tables)	9 Months Ended
	Sep. 30, 2015
Share-based Compensation Plans
Summary of recognized and unrecognized share based compensation expense	For the Three Months Ended For the Nine Months Ended September 30, September 30, 2015 2014 2015 2014 (dollars in thousands) Share-based compensation expense: Stock options $ $ $ $ Restricted stock Total expense $ $ $ $ Unrecognized compensation expense: Stock options $ $ Restricted stock Total unrecognized expense $ $
Summary of activity related to restricted stock granted, vested and forfeited	Number of Average Grant Shares Date Fair Value Balance December 31, 2014 $ Granted Vested Forfeited Balance September 30, 2015 $
Schedule of assumptions used in the calculation of weighted average fair value of options granted	For the Nine Months Ended September 30, 2015 2014 Expected volatility Expected term (years) Dividend yield Risk free rate Weighted-average grant date fair value $ $
Summary of activity related to options granted, exercised, and forfeited	Options Outstanding Options Number Weighted Average Available for of Shares Exercise Price Grant (1) Balance, December 31, 2014 $ Granted Forfeited Exercised Expired Balance, September 30, 2015 $ (1) Shares available for grant as of December 31, 2014 were from the 2005 Equity Based Compensation Plan, which expired in March 2015. As of September 30, 2015, no further grants can be made from that plan. Shares available for grant as of September 30, 2015 are from the 2015 Equity Incentive Plan, which was approved by the Company’s shareholders in May 2015.
Summary of the aggregate intrinsic value of options vested and expected to vest and exercisable	September 30, 2015 Weighted Average Weighted Remaining Aggregate Average Contractual Life Intrinsic Shares Exercise Price (Years) Value Vested or expected to vest $ $ Exercisable $ $

Shareholders' Equity (Tables)

Shareholders' Equity (Tables)	9 Months Ended
	Sep. 30, 2015
Shareholders' Equity
Schedule of the Company's and the Bank's actual regulatory capital ratios	Basel III Pre-Basel III Regulatory Regulatory Standard to be Standard to be Well September 30, 2015 Well December 31, 2014 September 30, 2014 Capitalized (1) Company Bank Capitalized (1) Company Bank Company Bank Ratio Common Equity Tier I capital 6.50% N/A N/A N/A N/A N/A Leverage ratio 5.00% 5.00% Tier I capital 8.00% 6.00% Total risk-based capital 10.00% 10.00% (1) Reflects minimum threshold to be considered “well capitalized” under the Prompt Corrective Action framework, specific to depository institutions.

Earnings Per Share (Tables)

Earnings Per Share (Tables)	9 Months Ended
	Sep. 30, 2015
Earnings Per Share
Schedule of calculation of both basic and diluted earnings per common share	For the Three Months Ended September 30, 2015 2014 Net Net Income Shares Income Shares (dollars in thousands, except per share data) Net income $ $ Accretion on preferred stock - - Net income available to common shareholders $ $ Weighted average shares outstanding Basic earnings per common share $ $ Dilutive effect of share-based compensation awards Weighted average diluted shares outstanding Diluted earnings per common share $ $ For the Nine Months Ended September 30, 2015 2014 Net Net Income Shares Income Shares (dollars in thousands, except per share data) Net income $ $ Accretion on preferred stock - Net income available to common shareholders $ $ Weighted average shares outstanding Basic earnings per common share $ $ Dilutive effect of share-based compensation awards Weighted average diluted shares outstanding Diluted earnings per common share $ $

Commitments and Contingencies (

Commitments and Contingencies (Tables)	9 Months Ended
	Sep. 30, 2015
Commitments and Contingencies.
Schedule of outstanding financial commitments	September 30, December 31, 2015 2014 (dollars in thousands) Commitments to extend credit $ $ Standby letters of credit (1) Total commitments and standby letters of credit $ $ (1) Includes a standby letter of credit to one customer in the amount of $10.4 million at September 30, 2015 and December 31, 2014.

Summary of Significant Accoun32

Summary of Significant Accounting Policies (Details) $ in Thousands	9 Months Ended
	Sep. 30, 2015USD ($)segment	Dec. 31, 2014USD ($)	Feb. 28, 2014
Assets the Company measures at fair value on a recurring basis
Total assets	$ 1,873,925	$ 1,710,127
Nature of Operations
Number of business segments | segment	1
MISN
Assets the Company measures at fair value on a recurring basis
Percentage acquired of outstanding common shares			100.00%
All Non-United States countries
Assets the Company measures at fair value on a recurring basis
Total assets	$ 0
Revenue	$ 0

Business Combination (Details)

Business Combination (Details) - USD ($) $ / shares in Units, $ in Thousands	Feb. 28, 2014	Sep. 30, 2014	Sep. 30, 2014
Pro Forma Financial Information
Net interest Income		$ 15,395	$ 45,761
Non-interest income		2,982	7,835
Non-interest expense		13,384	46,844
Income before income tax expense		4,993	6,752
Income tax expense		1,682	2,315
Net income		$ 3,311	$ 4,437
Loss Per Common Share
Basic (in dollars per share)		$ 0.10	$ 0.13
Diluted (in dollars per share)		$ 0.10	$ 0.13
MISN
Business combination
Percentage acquired of outstanding common shares	100.00%
Common stock issued (in shares)	7,541,326
Aggregate cash consideration	$ 8,700
Transaction value	$ 69,000
Closing price (in dollars per share)	$ 7.99

Fair Value of Assets and Liab34

Fair Value of Assets and Liabilities (Details) - USD ($) $ in Thousands	Sep. 30, 2015	Dec. 31, 2014
Assets the Company measures at fair value on a recurring basis
Total assets measured on a recurring basis	$ 432,750	$ 355,580
Obligations of U.S. government agencies
Assets the Company measures at fair value on a recurring basis
Total assets measured on a recurring basis	49,264	19,664
Mortgage-backed securities - U.S. government sponsored entities and agencies
Assets the Company measures at fair value on a recurring basis
Total assets measured on a recurring basis	232,499	215,398
Mortgage-backed securities - Non-agency
Assets the Company measures at fair value on a recurring basis
Total assets measured on a recurring basis	32,176	11,901
State and municipal securities
Assets the Company measures at fair value on a recurring basis
Total assets measured on a recurring basis	102,694	82,592
Asset backed securities
Assets the Company measures at fair value on a recurring basis
Total assets measured on a recurring basis	16,082	26,025
Other investments
Assets the Company measures at fair value on a recurring basis
Total assets measured on a recurring basis	35
Assets At Fair Value
Assets the Company measures at fair value on a recurring basis
Total assets measured on a recurring basis	432,750	355,580
Assets At Fair Value | Significant Other Observable Inputs (Level 2)
Assets the Company measures at fair value on a recurring basis
Total assets measured on a recurring basis	432,715	355,580
Assets At Fair Value | Quoted Prices in Active Markets for Identical Assets (Level 1)
Assets the Company measures at fair value on a recurring basis
Total assets measured on a recurring basis	35
Recurring basis | Significant Other Observable Inputs (Level 2)
Assets the Company measures at fair value on a recurring basis
Total assets measured on a recurring basis	432,715	355,580
Recurring basis | Significant Other Observable Inputs (Level 2) | Obligations of U.S. government agencies
Assets the Company measures at fair value on a recurring basis
Total assets measured on a recurring basis	49,264	19,664
Recurring basis | Significant Other Observable Inputs (Level 2) | Mortgage-backed securities - U.S. government sponsored entities and agencies
Assets the Company measures at fair value on a recurring basis
Total assets measured on a recurring basis	232,499	215,398
Recurring basis | Significant Other Observable Inputs (Level 2) | Mortgage-backed securities - Non-agency
Assets the Company measures at fair value on a recurring basis
Total assets measured on a recurring basis	32,176	11,901
Recurring basis | Significant Other Observable Inputs (Level 2) | State and municipal securities
Assets the Company measures at fair value on a recurring basis
Total assets measured on a recurring basis	102,694	82,592
Recurring basis | Significant Other Observable Inputs (Level 2) | Asset backed securities
Assets the Company measures at fair value on a recurring basis
Total assets measured on a recurring basis	16,082	26,025
Recurring basis | Quoted Prices in Active Markets for Identical Assets (Level 1)
Assets the Company measures at fair value on a recurring basis
Total assets measured on a recurring basis	35
Recurring basis | Quoted Prices in Active Markets for Identical Assets (Level 1) | Other investments
Assets the Company measures at fair value on a recurring basis
Total assets measured on a recurring basis	35
Recurring basis | Assets At Fair Value
Assets the Company measures at fair value on a recurring basis
Total assets measured on a recurring basis	432,750	355,580
Recurring basis | Assets At Fair Value | Obligations of U.S. government agencies
Assets the Company measures at fair value on a recurring basis
Total assets measured on a recurring basis	49,264	19,664
Recurring basis | Assets At Fair Value | Mortgage-backed securities - U.S. government sponsored entities and agencies
Assets the Company measures at fair value on a recurring basis
Total assets measured on a recurring basis	232,499	215,398
Recurring basis | Assets At Fair Value | Mortgage-backed securities - Non-agency
Assets the Company measures at fair value on a recurring basis
Total assets measured on a recurring basis	32,176	11,901
Recurring basis | Assets At Fair Value | State and municipal securities
Assets the Company measures at fair value on a recurring basis
Total assets measured on a recurring basis	102,694	82,592
Recurring basis | Assets At Fair Value | Asset backed securities
Assets the Company measures at fair value on a recurring basis
Total assets measured on a recurring basis	16,082	$ 26,025
Recurring basis | Assets At Fair Value | Other investments
Assets the Company measures at fair value on a recurring basis
Total assets measured on a recurring basis	$ 35

Fair Value of Assets and Liab35

Fair Value of Assets and Liabilities (Details 2) - USD ($) $ in Thousands	9 Months Ended	12 Months Ended
	Sep. 30, 2015	Dec. 31, 2014
Land
Total Losses for assets measured at fair value on a non-recurring basis
Year to Date Losses/(Recoveries) on impaired loans	$ (178)
Recurring basis
Transfers between level 1 and level 2
Assets transfer from Level 1 to level 2	0
Assets transfer from Level 2 to level 1	0
Non-recurring basis
Total Losses for assets measured at fair value on a non-recurring basis
Year to Date Losses/(Recoveries)	(178)	$ 80
Transfers between level 1 and level 2
Assets transfer from Level 1 to level 2	0
Assets transfer from Level 2 to level 1	0
Non-recurring basis | Commercial real estate
Total Losses for assets measured at fair value on a non-recurring basis
Year to Date Losses/(Recoveries)		1,026
Non-recurring basis | Land
Total Losses for assets measured at fair value on a non-recurring basis
Year to Date Losses/(Recoveries) on impaired loans		(946)
Non-recurring basis | Significant Unobservable Inputs (Level 3)
Assets
Total assets measured on a non-recurring basis	3,211	4,586
Non-recurring basis | Significant Unobservable Inputs (Level 3) | Commercial real estate
Assets
Impaired loans		1,325
Non-recurring basis | Significant Unobservable Inputs (Level 3) | Land
Assets
Impaired loans	3,211	3,261
Non-recurring basis | Assets At Fair Value
Assets
Total assets measured on a non-recurring basis	3,211	4,586
Non-recurring basis | Assets At Fair Value | Commercial real estate
Assets
Impaired loans		1,325
Non-recurring basis | Assets At Fair Value | Land
Assets
Impaired loans	$ 3,211	$ 3,261

Fair Value of Assets and Liab36

Fair Value of Assets and Liabilities (Details 3) - USD ($) $ in Thousands	Sep. 30, 2015	Dec. 31, 2014
Summary of the estimated fair value of financial instruments
Off-balance sheet instruments, commitments to extend credit and standby letters of credit, Notional Amount	$ 282,984	$ 253,275
Off-balance sheet instruments, commitments to extend credit and standby letters of credit, Cost to Cede or Assume	2,830	2,533
Assets
Investment securities available for sale, at fair value	432,750	355,580
Liabilities
Non-interest bearing deposits	544,782	461,479
Junior subordinated debentures	10,389	13,233
Carrying Amount
Assets
Cash and cash equivalents	112,270	35,580
Investment securities available for sale, at fair value	432,750	355,580
Federal Home Loan Bank stock	7,853	7,853
Loans receivable, net of deferred fees and costs	1,205,684	1,192,038
Loans held for sale	5,366	2,586
Accrued interest receivable	5,911	5,659
Liabilities
Non-interest bearing deposits	544,782	461,479
Interest bearing deposits	1,026,988	933,325
Federal Home Loan Bank advances	78,546	95,558
Junior subordinated debentures	10,389	13,233
Accrued interest payable	412	401
Assets At Fair Value
Assets
Cash and cash equivalents	112,270	35,580
Investment securities available for sale, at fair value	432,750	355,580
Loans receivable, net of deferred fees and costs	1,232,158	1,196,997
Loans held for sale	5,366	2,586
Accrued interest receivable	5,911	5,659
Liabilities
Non-interest bearing deposits	544,782	461,479
Interest bearing deposits	1,028,358	936,151
Federal Home Loan Bank advances	79,986	96,679
Junior subordinated debentures	8,522	9,297
Accrued interest payable	412	401
Assets At Fair Value | Quoted Prices in Active Markets for Identical Assets (Level 1)
Assets
Cash and cash equivalents	112,270	35,580
Investment securities available for sale, at fair value	35
Liabilities
Non-interest bearing deposits	544,782	461,479
Assets At Fair Value | Significant Other Observable Inputs (Level 2)
Assets
Investment securities available for sale, at fair value	432,715	355,580
Loans held for sale	5,366	2,586
Accrued interest receivable	2,242	2,038
Liabilities
Interest bearing deposits	1,028,358	936,151
Federal Home Loan Bank advances	79,986	96,679
Accrued interest payable	412	401
Assets At Fair Value | Significant Unobservable Inputs (Level 3)
Assets
Loans receivable, net of deferred fees and costs	1,232,158	1,196,997
Accrued interest receivable	3,669	3,621
Liabilities
Junior subordinated debentures	$ 8,522	$ 9,297

Investment Securities (Details)

Investment Securities (Details) - USD ($) $ in Thousands	Sep. 30, 2015	Dec. 31, 2014
Reconciliation of amortized cost to fair value of investment securities reported as available for sale
Total	$ 430,562	$ 353,971
Gross Unrealized Gains	4,340	4,147
Gross Unrealized Losses	(2,152)	(2,538)
Fair Value	432,750	355,580
Obligations of U.S. government agencies
Reconciliation of amortized cost to fair value of investment securities reported as available for sale
Total	49,238	19,562
Gross Unrealized Gains	346	191
Gross Unrealized Losses	(320)	(89)
Fair Value	49,264	19,664
Mortgage-backed securities - U.S. government sponsored entities and agencies
Reconciliation of amortized cost to fair value of investment securities reported as available for sale
Total	231,779	216,492
Gross Unrealized Gains	1,633	1,092
Gross Unrealized Losses	(913)	(2,186)
Fair Value	232,499	215,398
Mortgage-backed securities - Non-agency
Reconciliation of amortized cost to fair value of investment securities reported as available for sale
Total	32,283	11,891
Gross Unrealized Gains	40	21
Gross Unrealized Losses	(147)	(11)
Fair Value	32,176	11,901
State and municipal securities
Reconciliation of amortized cost to fair value of investment securities reported as available for sale
Total	100,704	79,810
Gross Unrealized Gains	2,321	2,843
Gross Unrealized Losses	(331)	(61)
Fair Value	102,694	82,592
Asset backed securities
Reconciliation of amortized cost to fair value of investment securities reported as available for sale
Total	16,458	26,216
Gross Unrealized Losses	(376)	(191)
Fair Value	16,082	$ 26,025
Other investments
Reconciliation of amortized cost to fair value of investment securities reported as available for sale
Total	100
Gross Unrealized Losses	(65)
Fair Value	$ 35

Investment Securities (Details

Investment Securities (Details 2) $ in Thousands	9 Months Ended
	Sep. 30, 2015USD ($)security	Dec. 31, 2014USD ($)security
Investment securities
Less Than Twelve Months, Fair Value	$ 120,284	$ 62,277
Less Than Twelve Months, Unrealized Loss	(1,229)	(741)
Twelve Months or More, Fair Value	50,991	81,265
Twelve Months or More, Unrealized Loss	(923)	(1,797)
Total, Fair Value	171,275	143,542
Total, Unrealized Loss	$ (2,152)	$ (2,538)
Securities were in an unrealized loss position | security	78	57
Investment security holdings | Minimum
Securities in an unrealized loss position
Maturity period of available-for-sale securities	1 year
Investment security holdings | Maximum
Securities in an unrealized loss position
Maturity period of available-for-sale securities	40 years
Obligations of U.S. government agencies
Investment securities
Less Than Twelve Months, Fair Value	$ 32,115	$ 2,795
Less Than Twelve Months, Unrealized Loss	(320)	(17)
Twelve Months or More, Fair Value		2,607
Twelve Months or More, Unrealized Loss		(72)
Total, Fair Value	32,115	5,402
Total, Unrealized Loss	(320)	(89)
Mortgage-backed securities - U.S. government sponsored entities and agencies
Investment securities
Less Than Twelve Months, Fair Value	45,582	50,583
Less Than Twelve Months, Unrealized Loss	(376)	(670)
Twelve Months or More, Fair Value	32,365	58,753
Twelve Months or More, Unrealized Loss	(537)	(1,516)
Total, Fair Value	77,947	109,336
Total, Unrealized Loss	(913)	(2,186)
Mortgage-backed securities - Non-agency
Investment securities
Less Than Twelve Months, Fair Value	17,219	3,000
Less Than Twelve Months, Unrealized Loss	(142)	(7)
Twelve Months or More, Fair Value	1,581	507
Twelve Months or More, Unrealized Loss	(5)	(4)
Total, Fair Value	18,800	3,507
Total, Unrealized Loss	(147)	(11)
State and municipal securities
Investment securities
Less Than Twelve Months, Fair Value	25,333	5,899
Less Than Twelve Months, Unrealized Loss	(326)	(47)
Twelve Months or More, Fair Value	963	2,245
Twelve Months or More, Unrealized Loss	(5)	(14)
Total, Fair Value	26,296	8,144
Total, Unrealized Loss	(331)	(61)
Asset backed securities
Investment securities
Twelve Months or More, Fair Value	16,082	17,153
Twelve Months or More, Unrealized Loss	(376)	(191)
Total, Fair Value	16,082	17,153
Total, Unrealized Loss	(376)	$ (191)
Other investments
Investment securities
Less Than Twelve Months, Fair Value	35
Less Than Twelve Months, Unrealized Loss	(65)
Total, Fair Value	35
Total, Unrealized Loss	$ (65)

Investment Securities (Detail39

Investment Securities (Details 3) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014
Proceeds from the sales and calls of securities and the associated gains and losses
Proceeds	$ 8,656	$ 19,991	$ 55,184	$ 98,379
Gross gains	136	457	815	814
Gross losses		(7)	(174)	(265)
Income tax expense (benefit) related to net realized gains (losses) on sale of securities	$ 57	$ 189	$ 270	$ 231

Investment Securities (Detail40

Investment Securities (Details 4) - USD ($) $ in Thousands	Sep. 30, 2015	Dec. 31, 2014
Available for sale securities, Amortized cost
Due one year or less	$ 46,219	$ 38,674
Due after one year through five years	145,177	113,081
Due after five years through ten years	173,928	137,909
Due after ten years	65,238	64,307
Total	430,562	353,971
Available for sale securities, Fair Value
Due one year or less	46,291	38,587
Due after one year through five years	145,642	112,926
Due after five years through ten years	175,581	140,115
Due after ten years	65,236	63,952
Total	432,750	355,580
Securities pledged to secure public deposits
Available for sale securities, Amortized cost
Total	141,500	67,300
Available for sale securities, Fair Value
Total	$ 148,900	$ 72,500

Investment Securities (Detail41

Investment Securities (Details 5) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014
Earnings on both taxable and tax-exempt investment securities
Total	$ 1,864	$ 1,946	$ 5,193	$ 5,355
Obligations of U.S. government agencies
Earnings on both taxable and tax-exempt investment securities
Taxable earnings on investment securities	161	112	487	226
Mortgage backed securities
Earnings on both taxable and tax-exempt investment securities
Taxable earnings on investment securities	938	1,152	2,529	3,370
State and municipal securities
Earnings on both taxable and tax-exempt investment securities
Taxable earnings on investment securities	151	38	339	40
Non-taxable earnings on investment securities	581	545	1,725	1,452
Corporate debt securities
Earnings on both taxable and tax-exempt investment securities
Taxable earnings on investment securities				6
Asset backed securities
Earnings on both taxable and tax-exempt investment securities
Taxable earnings on investment securities	$ 33	$ 99	$ 113	$ 261

Loans and Allowance for Loan 42

Loans and Allowance for Loan and Lease Losses (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014	Jun. 30, 2015	Dec. 31, 2014	Jun. 30, 2014	Dec. 31, 2013
Outstanding loan balances
Total gross loans held for investment	$ 1,206,740		$ 1,206,740			$ 1,193,483
Net deferred loan fees	(1,056)		(1,056)			(1,445)
Allowance for loan and lease losses	(17,296)	$ (16,787)	(17,296)	$ (16,787)	$ (16,982)	(16,802)	$ (16,635)	$ (17,859)
Net loans held for investment	1,188,388		1,188,388			1,175,236
Loans held for sale	5,366		5,366			2,586
Concentration of Credit Risk
Loan portfolio collateralized by various forms of real estate	999,400		999,400			978,200
Loans Serviced for Others
Unpaid principal balance of loans serviced for others, exclusive of SBA loans	41,800		41,800			44,800
Unpaid principal balance of SBA loans serviced for others	9,000		9,000			13,000
Recognized gains from the sale of SBA loans	0	0	0	0
Non-PCI Loans
Outstanding loan balances
Total gross loans held for investment	1,197,307		1,197,307			1,183,183
Net deferred loan fees	(1,056)		(1,056)			(1,445)
Allowance for loan and lease losses	(17,214)		(17,214)			(16,802)
Net loans held for investment	1,179,037		1,179,037			1,164,936
Loans held for sale	5,366		5,366			2,586
PCI loans
Outstanding loan balances
Total gross loans held for investment	9,433		9,433			10,300
Allowance for loan and lease losses	(82)		(82)
Net loans held for investment	9,351		9,351			10,300
Federal Reserve Bank
Outstanding loan balances
Loans pledged as collateral	601,400		601,400
FHLB secured credit facility	400,100		400,100
FHLB secured borrowings	78,500		78,500
FHLB secured line of credit	11,500		11,500
Reserve maintained for the exercise of repurchase option by buyer	6,900		6,900
MISN
Outstanding loan balances
Total gross loans held for investment	195,800		195,800			239,700
MISN | PCI loans
Outstanding loan balances
Total gross loans held for investment	9,400		$ 9,400			10,300
Minimum
Outstanding loan balances
Period for sale of loans categorized as held for sale			30 days
Maximum
Outstanding loan balances
Period for sale of loans categorized as held for sale			60 days
Real Estate Secured
Outstanding loan balances
Total gross loans held for investment	993,992		$ 993,992			975,603
Real Estate Secured | Non-PCI Loans
Outstanding loan balances
Total gross loans held for investment	986,911		986,911			968,110
Real Estate Secured | PCI loans
Outstanding loan balances
Total gross loans held for investment	7,081		7,081			7,493
Real Estate Secured | Commercial real estate
Outstanding loan balances
Total gross loans held for investment	581,767		581,767			588,472
Real Estate Secured | Commercial real estate | Non-PCI Loans
Outstanding loan balances
Total gross loans held for investment	576,053		576,053			584,056
Real Estate Secured | Commercial real estate | PCI loans
Outstanding loan balances
Total gross loans held for investment	5,714		5,714			4,416
Real Estate Secured | Residential 1 to 4 family
Outstanding loan balances
Total gross loans held for investment	154,895		154,895			127,201
Real Estate Secured | Residential 1 to 4 family | Non-PCI Loans
Outstanding loan balances
Total gross loans held for investment	154,327		154,327			126,640
Real Estate Secured | Residential 1 to 4 family | PCI loans
Outstanding loan balances
Total gross loans held for investment	568		568			561
Real Estate Secured | Farmland
Outstanding loan balances
Total gross loans held for investment	107,376		107,376			98,373
Real Estate Secured | Farmland | Non-PCI Loans
Outstanding loan balances
Total gross loans held for investment	107,376		107,376			96,708
Real Estate Secured | Farmland | PCI loans
Outstanding loan balances
Total gross loans held for investment						1,665
Real Estate Secured | Multi-family residential
Outstanding loan balances
Total gross loans held for investment	75,774		75,774			78,645
Real Estate Secured | Multi-family residential | Non-PCI Loans
Outstanding loan balances
Total gross loans held for investment	75,774		75,774			78,645
Real Estate Secured | Construction and land
Outstanding loan balances
Total gross loans held for investment	42,571		42,571			44,660
Real Estate Secured | Construction and land | Non-PCI Loans
Outstanding loan balances
Total gross loans held for investment	41,772		41,772			43,809
Real Estate Secured | Construction and land | PCI loans
Outstanding loan balances
Total gross loans held for investment	799		799			851
Real Estate Secured | Home equity lines of credit
Outstanding loan balances
Total gross loans held for investment	31,609		31,609			38,252
Real Estate Secured | Home equity lines of credit | Non-PCI Loans
Outstanding loan balances
Total gross loans held for investment	31,609		31,609			38,252
Commercial
Outstanding loan balances
Total gross loans held for investment	206,256		206,256			209,902
Allowance for loan and lease losses	(5,485)	(4,314)	(5,485)	(4,314)	(4,993)	(5,125)	(4,436)	(4,781)
Commercial | Non-PCI Loans
Outstanding loan balances
Total gross loans held for investment	203,904		203,904			207,095
Commercial | PCI loans
Outstanding loan balances
Total gross loans held for investment	2,352		2,352			2,807
Commercial | Commercial and industrial
Outstanding loan balances
Total gross loans held for investment	159,012		159,012			154,787
Commercial | Commercial and industrial | Non-PCI Loans
Outstanding loan balances
Total gross loans held for investment	158,106		158,106			153,403
Commercial | Commercial and industrial | PCI loans
Outstanding loan balances
Total gross loans held for investment	906		906			1,384
Commercial | Agriculture
Outstanding loan balances
Total gross loans held for investment	47,244		47,244			55,101
Commercial | Agriculture | Non-PCI Loans
Outstanding loan balances
Total gross loans held for investment	45,798		45,798			53,678
Commercial | Agriculture | PCI loans
Outstanding loan balances
Total gross loans held for investment	1,446		1,446			1,423
Commercial | Other
Outstanding loan balances
Total gross loans held for investment						14
Commercial | Other | Non-PCI Loans
Outstanding loan balances
Total gross loans held for investment						14
Consumer
Outstanding loan balances
Total gross loans held for investment	6,492		6,492			7,978
Allowance for loan and lease losses	(191)	$ (109)	(191)	$ (109)	$ (171)	(202)	$ (100)	$ (131)
Consumer | Non-PCI Loans
Outstanding loan balances
Total gross loans held for investment	$ 6,492		$ 6,492			$ 7,978

Loans and Allowance for Loan 43

Loans and Allowance for Loan and Lease Losses (Details 2) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2015USD ($)loan	Sep. 30, 2014USD ($)	Sep. 30, 2015USD ($)loan	Sep. 30, 2014USD ($)	Dec. 31, 2014USD ($)
Non-PCI Loans
Investment in impaired loans
Recorded investment without related allowance	$ 10,788		$ 10,788		$ 9,978
Recorded investment with related allowance	6,184		6,184		6,417
Unpaid principal balance without related allowance	16,240		16,240		14,543
Unpaid principal balance with related allowance	7,559		7,559		10,241
Specific Allowance for Impaired Loans	1,114		1,114		1,771
Average recorded investment without related allowance	11,087	$ 8,192	11,596	$ 8,804
Average recorded investment with related allowance	5,989	8,627	5,762	8,946
Interest income recognized without related allowance	94	75	275	200
Interest income recognized with related allowance	22	57	50	148
Recorded Investment	16,972		16,972		16,395
Unpaid Principal Balance	23,799		23,799		24,784
Average Recorded Investment	17,076	16,819	17,358	17,750
Interest Income Recognized	116	132	325	348
PCI loans
Investment in impaired loans
Recorded investment without related allowance	8,170		8,170		10,341
Recorded investment with related allowance	1,263		1,263
Unpaid principal balance without related allowance	10,552		10,552		13,390
Unpaid principal balance with related allowance	1,278		1,278
Specific Allowance for Impaired Loans	82		82
Average recorded investment without related allowance	8,290	11,643	8,535	12,002
Average recorded investment with related allowance	1,281		1,308
Interest income recognized without related allowance	233	405	1,104	796
Interest income recognized with related allowance	25		86
Recorded Investment	9,433		9,433
Unpaid Principal Balance	11,830		11,830
Average Recorded Investment	9,571		9,843
Interest Income Recognized	$ 258		$ 1,190
Residential 1 to 4 family
Foreclosures
Number of foreclosures | loan	0		0
Foreclosed assets	$ 0		$ 0
Real Estate Secured | Commercial real estate | Non-PCI Loans
Investment in impaired loans
Recorded investment without related allowance	4,212		4,212		4,000
Recorded investment with related allowance	453		453		498
Unpaid principal balance without related allowance	5,676		5,676		6,255
Unpaid principal balance with related allowance	671		671		688
Specific Allowance for Impaired Loans	94		94		148
Average recorded investment without related allowance	4,247	2,269	4,158	1,862
Average recorded investment with related allowance	461	331	476	331
Interest income recognized without related allowance	36	6	110	19
Real Estate Secured | Commercial real estate | PCI loans
Investment in impaired loans
Recorded investment without related allowance	5,178		5,178		4,432
Recorded investment with related allowance	536		536
Unpaid principal balance without related allowance	6,663		6,663		6,109
Unpaid principal balance with related allowance	547		547
Specific Allowance for Impaired Loans	41		41
Average recorded investment without related allowance	5,189	4,993	5,297	5,160
Average recorded investment with related allowance	537		536
Interest income recognized without related allowance	122	130	807	327
Interest income recognized with related allowance	10		38
Real Estate Secured | Construction and land | Non-PCI Loans
Investment in impaired loans
Recorded investment without related allowance	1,263		1,263		1,470
Recorded investment with related allowance	4,000		4,000		4,876
Unpaid principal balance without related allowance	4,517		4,517		2,355
Unpaid principal balance with related allowance	5,152		5,152		8,499
Specific Allowance for Impaired Loans	789		789		1,472
Average recorded investment without related allowance	1,556	1,315	1,798	1,550
Average recorded investment with related allowance	4,084	6,380	4,147	6,602
Interest income recognized without related allowance	24	7	71	37
Interest income recognized with related allowance		16		58
Real Estate Secured | Construction and land | PCI loans
Investment in impaired loans
Recorded investment without related allowance	554		554		853
Recorded investment with related allowance	245		245
Unpaid principal balance without related allowance	666		666		993
Unpaid principal balance with related allowance	248		248
Specific Allowance for Impaired Loans	6		6
Average recorded investment without related allowance	553	923	556	943
Average recorded investment with related allowance	254		272
Interest income recognized without related allowance	19	21	58	47
Interest income recognized with related allowance	5		15
Real Estate Secured | Residential 1 to 4 family | Non-PCI Loans
Investment in impaired loans
Recorded investment without related allowance	788		788		260
Unpaid principal balance without related allowance	964		964		383
Average recorded investment without related allowance	748	222	602	496
Interest income recognized without related allowance	10	6	12	16
Real Estate Secured | Residential 1 to 4 family | PCI loans
Investment in impaired loans
Recorded investment without related allowance	568		568		564
Unpaid principal balance without related allowance	878		878		886
Average recorded investment without related allowance	566	565	565	585
Interest income recognized without related allowance	18	13	48	29
Real Estate Secured | Farmland | Non-PCI Loans
Investment in impaired loans
Recorded investment without related allowance	498		498		283
Unpaid principal balance without related allowance	498		498		282
Average recorded investment without related allowance	385	292	558	294
Interest income recognized without related allowance	7	2	26	12
Real Estate Secured | Farmland | PCI loans
Investment in impaired loans
Recorded investment without related allowance					1,673
Unpaid principal balance without related allowance					2,027
Average recorded investment without related allowance		1,699		1,706
Interest income recognized without related allowance		20		64
Real Estate Secured | Home equity lines of credit | Non-PCI Loans
Investment in impaired loans
Recorded investment without related allowance	85		85		258
Unpaid principal balance without related allowance	86		86		340
Average recorded investment without related allowance	85	100	119	100
Real Estate Secured | Home equity lines of credit | PCI loans
Investment in impaired loans
Average recorded investment without related allowance		81		81
Interest income recognized without related allowance		2		4
Commercial | Commercial and industrial | Non-PCI Loans
Investment in impaired loans
Recorded investment without related allowance	3,126		3,126		2,875
Recorded investment with related allowance	1,731		1,731		1,043
Unpaid principal balance without related allowance	3,528		3,528		3,967
Unpaid principal balance with related allowance	1,736		1,736		1,054
Specific Allowance for Impaired Loans	231		231		151
Average recorded investment without related allowance	3,252	3,152	3,541	3,616
Average recorded investment with related allowance	1,444	1,916	1,139	2,013
Interest income recognized without related allowance	10	51	45	111
Interest income recognized with related allowance	22	41	50	90
Commercial | Commercial and industrial | PCI loans
Investment in impaired loans
Recorded investment without related allowance	424		424		1,388
Recorded investment with related allowance	482		482
Unpaid principal balance without related allowance	845		845		1,883
Unpaid principal balance with related allowance	483		483
Specific Allowance for Impaired Loans	35		35
Average recorded investment without related allowance	542	2,081	680	2,236
Average recorded investment with related allowance	490		500
Interest income recognized without related allowance	44	185	104	263
Interest income recognized with related allowance	10		33
Commercial | Agriculture | Non-PCI Loans
Investment in impaired loans
Recorded investment without related allowance	653		653		720
Unpaid principal balance without related allowance	744		744		760
Average recorded investment without related allowance	654	724	671	741
Interest income recognized without related allowance	6	2	7	2
Commercial | Agriculture | PCI loans
Investment in impaired loans
Recorded investment without related allowance	1,446		1,446		1,431
Unpaid principal balance without related allowance	1,500		1,500		1,492
Average recorded investment without related allowance	1,440	1,301	1,437	1,291
Interest income recognized without related allowance	30	34	87	62
Consumer | Non-PCI Loans
Investment in impaired loans
Recorded investment without related allowance	163		163		112
Unpaid principal balance without related allowance	227		227		$ 201
Average recorded investment without related allowance	160	118	149	145
Interest income recognized without related allowance	$ 1	$ 1	$ 4	$ 3

Loans and Allowance for Loan 44

Loans and Allowance for Loan and Lease Losses (Details 3) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2015USD ($)loan	Sep. 30, 2014USD ($)item	Sep. 30, 2015USD ($)itemloan	Sep. 30, 2014USD ($)itemloan	Dec. 31, 2014USD ($)
Troubled debt restructurings
Accruing loans that were classified as TDRs	$ 8,622		$ 8,622		$ 6,511
Non-Accruing loans that were classified as TDRs	7,305		7,305		7,057
Total loans classified as TDRs	15,927		15,927		13,568
Loans modified as a TDRs	$ 100		$ 100
Number of loans modified as a TDRs | loan	1		1
Number of TDRs	12	6	37	24
Pre-Modification Outstanding Recorded Investment	$ 2,254	$ 912	$ 7,906	$ 3,684
Post-Modification Outstanding Recorded Investment	2,254	$ 912	$ 7,906	$ 3,684
Minimum
Troubled debt restructurings
Period of maturity date extensions granted			6 years
Maximum
Troubled debt restructurings
Period of maturity date extensions granted			10 years
Non-PCI Loans
Troubled debt restructurings
Accruing loans that were classified as TDRs	7,127		$ 7,127		6,251
Non-Accruing loans that were classified as TDRs	7,176		7,176		6,950
Total loans classified as TDRs	14,303		$ 14,303		13,201
Troubled Debt Restructurings That Subsequently Defaulted
Number of TDRs | item			1	1
Recorded Investment			$ 18	$ 30
Non-PCI Loans | Real Estate Secured | Commercial real estate
Troubled debt restructurings
Accruing loans that were classified as TDRs	2,601		2,601		2,449
Non-Accruing loans that were classified as TDRs	209		209		78
Total loans classified as TDRs	2,810		$ 2,810		2,527
Number of TDRs | loan			4	1
Pre-Modification Outstanding Recorded Investment			$ 670	$ 166
Post-Modification Outstanding Recorded Investment			670	$ 166
Non-PCI Loans | Real Estate Secured | Construction and land
Troubled debt restructurings
Accruing loans that were classified as TDRs	1,217		1,217		1,109
Non-Accruing loans that were classified as TDRs	4,046		4,046		5,149
Total loans classified as TDRs	5,263		$ 5,263		6,258
Number of TDRs		2	1	4
Pre-Modification Outstanding Recorded Investment		$ 535	$ 97	$ 811
Post-Modification Outstanding Recorded Investment		$ 535	97	$ 811
Non-PCI Loans | Real Estate Secured | Residential 1 to 4 family
Troubled debt restructurings
Accruing loans that were classified as TDRs	617		617		130
Non-Accruing loans that were classified as TDRs	171		171		130
Total loans classified as TDRs	$ 788		$ 788		260
Number of TDRs | loan	1		4
Pre-Modification Outstanding Recorded Investment	$ 129		$ 753
Post-Modification Outstanding Recorded Investment	129		753
Non-PCI Loans | Real Estate Secured | Farmland
Troubled debt restructurings
Accruing loans that were classified as TDRs	498		498		283
Total loans classified as TDRs	$ 498		$ 498		283
Number of TDRs | loan	1		2
Pre-Modification Outstanding Recorded Investment	$ 232		$ 730
Post-Modification Outstanding Recorded Investment	232		730
Non-PCI Loans | Commercial | Commercial and industrial
Troubled debt restructurings
Accruing loans that were classified as TDRs	1,425		1,425		2,177
Non-Accruing loans that were classified as TDRs	2,740		2,740		1,593
Total loans classified as TDRs	$ 4,165		$ 4,165		3,770
Number of TDRs	4	4	13	14
Pre-Modification Outstanding Recorded Investment	$ 323	$ 377	$ 2,436	$ 1,604
Post-Modification Outstanding Recorded Investment	323	$ 377	$ 2,436	$ 1,604
Troubled Debt Restructurings That Subsequently Defaulted
Number of TDRs | item			1	1
Recorded Investment			$ 18	$ 30
Non-PCI Loans | Commercial | Agriculture
Troubled debt restructurings
Accruing loans that were classified as TDRs	653		653		34
Total loans classified as TDRs	$ 653		$ 653		34
Number of TDRs | loan	3		4	1
Pre-Modification Outstanding Recorded Investment	$ 714		$ 1,612	$ 662
Post-Modification Outstanding Recorded Investment	714		1,612	$ 662
Non-PCI Loans | Consumer
Troubled debt restructurings
Accruing loans that were classified as TDRs	116		116		69
Non-Accruing loans that were classified as TDRs	10		10
Total loans classified as TDRs	$ 126		$ 126		69
Number of TDRs | loan	1		2	1
Pre-Modification Outstanding Recorded Investment	$ 11		$ 68	$ 73
Post-Modification Outstanding Recorded Investment	11		68	$ 73
PCI loans
Troubled debt restructurings
Accruing loans that were classified as TDRs	1,495		1,495		260
Non-Accruing loans that were classified as TDRs	129		129		107
Total loans classified as TDRs	1,624		1,624		367
PCI loans | Real Estate Secured | Commercial real estate
Troubled debt restructurings
Accruing loans that were classified as TDRs	928		928		223
Non-Accruing loans that were classified as TDRs	53		53
Total loans classified as TDRs	$ 981		$ 981		223
Number of TDRs | loan	1		5	1
Pre-Modification Outstanding Recorded Investment	$ 348		$ 993	$ 230
Post-Modification Outstanding Recorded Investment	348		993	$ 230
PCI loans | Real Estate Secured | Construction and land
Troubled debt restructurings
Accruing loans that were classified as TDRs	51		51
Total loans classified as TDRs	$ 51		$ 51
Number of TDRs | loan			1
Pre-Modification Outstanding Recorded Investment			$ 50
Post-Modification Outstanding Recorded Investment			$ 50
PCI loans | Real Estate Secured | Commercial and industrial
Troubled debt restructurings
Number of TDRs | loan	1		1	2
Pre-Modification Outstanding Recorded Investment	$ 497		$ 497	$ 138
Post-Modification Outstanding Recorded Investment	497		497	$ 138
PCI loans | Commercial | Commercial and industrial
Troubled debt restructurings
Accruing loans that were classified as TDRs	516		516		37
Non-Accruing loans that were classified as TDRs	76		76		107
Total loans classified as TDRs	$ 592		$ 592		$ 144

Loans and Allowance for Loan 45

Loans and Allowance for Loan and Lease Losses (Details 4) - USD ($) $ in Thousands	Sep. 30, 2015	Dec. 31, 2014
Non-PCI loans by the internal risk grading system
Total Gross loans	$ 1,206,740	$ 1,193,483
Credit Risk Grades, Pass
Non-PCI loans by the internal risk grading system
Total Gross loans	1,138,834	1,130,984
Credit Risk Grades, Special Mention
Non-PCI loans by the internal risk grading system
Total Gross loans	24,188	9,874
Credit Risk Grades, Substandard
Non-PCI loans by the internal risk grading system
Total Gross loans	43,718	52,395
Credit Risk Grades, Doubtful
Non-PCI loans by the internal risk grading system
Total Gross loans		230
Real Estate Secured
Non-PCI loans by the internal risk grading system
Total Gross loans	993,992	975,603
Real Estate Secured | Commercial real estate
Non-PCI loans by the internal risk grading system
Total Gross loans	581,767	588,472
Real Estate Secured | Residential 1 to 4 family
Non-PCI loans by the internal risk grading system
Total Gross loans	154,895	127,201
Real Estate Secured | Farmland
Non-PCI loans by the internal risk grading system
Total Gross loans	107,376	98,373
Real Estate Secured | Multi-family residential
Non-PCI loans by the internal risk grading system
Total Gross loans	75,774	78,645
Real Estate Secured | Construction and land
Non-PCI loans by the internal risk grading system
Total Gross loans	42,571	44,660
Real Estate Secured | Home equity lines of credit
Non-PCI loans by the internal risk grading system
Total Gross loans	31,609	38,252
Commercial
Non-PCI loans by the internal risk grading system
Total Gross loans	206,256	209,902
Commercial | Commercial and industrial
Non-PCI loans by the internal risk grading system
Total Gross loans	159,012	154,787
Commercial | Agriculture
Non-PCI loans by the internal risk grading system
Total Gross loans	47,244	55,101
Commercial | Other
Non-PCI loans by the internal risk grading system
Total Gross loans		14
Consumer
Non-PCI loans by the internal risk grading system
Total Gross loans	6,492	7,978
Non-PCI Loans
Non-PCI loans by the internal risk grading system
Total Gross loans	1,197,307	1,183,183
Non-PCI Loans | Credit Risk Grades, Pass
Non-PCI loans by the internal risk grading system
Total Gross loans	1,138,104	1,130,528
Non-PCI Loans | Credit Risk Grades, Special Mention
Non-PCI loans by the internal risk grading system
Total Gross loans	22,206	9,097
Non-PCI Loans | Credit Risk Grades, Substandard
Non-PCI loans by the internal risk grading system
Total Gross loans	36,997	43,404
Non-PCI Loans | Credit Risk Grades, Doubtful
Non-PCI loans by the internal risk grading system
Total Gross loans		154
Non-PCI Loans | Real Estate Secured
Non-PCI loans by the internal risk grading system
Total Gross loans	986,911	968,110
Non-PCI Loans | Real Estate Secured | Commercial real estate
Non-PCI loans by the internal risk grading system
Total Gross loans	576,053	584,056
Non-PCI Loans | Real Estate Secured | Commercial real estate | Credit Risk Grades, Pass
Non-PCI loans by the internal risk grading system
Total Gross loans	547,307	560,478
Non-PCI Loans | Real Estate Secured | Commercial real estate | Credit Risk Grades, Special Mention
Non-PCI loans by the internal risk grading system
Total Gross loans	6,594	3,010
Non-PCI Loans | Real Estate Secured | Commercial real estate | Credit Risk Grades, Substandard
Non-PCI loans by the internal risk grading system
Total Gross loans	22,152	20,568
Non-PCI Loans | Real Estate Secured | Residential 1 to 4 family
Non-PCI loans by the internal risk grading system
Total Gross loans	154,327	126,640
Non-PCI Loans | Real Estate Secured | Residential 1 to 4 family | Credit Risk Grades, Pass
Non-PCI loans by the internal risk grading system
Total Gross loans	153,200	125,733
Non-PCI Loans | Real Estate Secured | Residential 1 to 4 family | Credit Risk Grades, Special Mention
Non-PCI loans by the internal risk grading system
Total Gross loans		199
Non-PCI Loans | Real Estate Secured | Residential 1 to 4 family | Credit Risk Grades, Substandard
Non-PCI loans by the internal risk grading system
Total Gross loans	1,127	708
Non-PCI Loans | Real Estate Secured | Farmland
Non-PCI loans by the internal risk grading system
Total Gross loans	107,376	96,708
Non-PCI Loans | Real Estate Secured | Farmland | Credit Risk Grades, Pass
Non-PCI loans by the internal risk grading system
Total Gross loans	105,540	92,481
Non-PCI Loans | Real Estate Secured | Farmland | Credit Risk Grades, Special Mention
Non-PCI loans by the internal risk grading system
Total Gross loans	232	2,665
Non-PCI Loans | Real Estate Secured | Farmland | Credit Risk Grades, Substandard
Non-PCI loans by the internal risk grading system
Total Gross loans	1,604	1,562
Non-PCI Loans | Real Estate Secured | Multi-family residential
Non-PCI loans by the internal risk grading system
Total Gross loans	75,774	78,645
Non-PCI Loans | Real Estate Secured | Multi-family residential | Credit Risk Grades, Pass
Non-PCI loans by the internal risk grading system
Total Gross loans	67,147	78,023
Non-PCI Loans | Real Estate Secured | Multi-family residential | Credit Risk Grades, Special Mention
Non-PCI loans by the internal risk grading system
Total Gross loans	8,627
Non-PCI Loans | Real Estate Secured | Multi-family residential | Credit Risk Grades, Substandard
Non-PCI loans by the internal risk grading system
Total Gross loans		622
Non-PCI Loans | Real Estate Secured | Construction and land
Non-PCI loans by the internal risk grading system
Total Gross loans	41,772	43,809
Non-PCI Loans | Real Estate Secured | Construction and land | Credit Risk Grades, Pass
Non-PCI loans by the internal risk grading system
Total Gross loans	36,477	37,422
Non-PCI Loans | Real Estate Secured | Construction and land | Credit Risk Grades, Special Mention
Non-PCI loans by the internal risk grading system
Total Gross loans	969
Non-PCI Loans | Real Estate Secured | Construction and land | Credit Risk Grades, Substandard
Non-PCI loans by the internal risk grading system
Total Gross loans	4,326	6,387
Non-PCI Loans | Real Estate Secured | Home equity lines of credit
Non-PCI loans by the internal risk grading system
Total Gross loans	31,609	38,252
Non-PCI Loans | Real Estate Secured | Home equity lines of credit | Credit Risk Grades, Pass
Non-PCI loans by the internal risk grading system
Total Gross loans	31,088	37,638
Non-PCI Loans | Real Estate Secured | Home equity lines of credit | Credit Risk Grades, Substandard
Non-PCI loans by the internal risk grading system
Total Gross loans	521	614
Non-PCI Loans | Commercial
Non-PCI loans by the internal risk grading system
Total Gross loans	203,904	207,095
Non-PCI Loans | Commercial | Commercial and industrial
Non-PCI loans by the internal risk grading system
Total Gross loans	158,106	153,403
Non-PCI Loans | Commercial | Commercial and industrial | Credit Risk Grades, Pass
Non-PCI loans by the internal risk grading system
Total Gross loans	146,176	138,202
Non-PCI Loans | Commercial | Commercial and industrial | Credit Risk Grades, Special Mention
Non-PCI loans by the internal risk grading system
Total Gross loans	5,664	2,943
Non-PCI Loans | Commercial | Commercial and industrial | Credit Risk Grades, Substandard
Non-PCI loans by the internal risk grading system
Total Gross loans	6,266	12,104
Non-PCI Loans | Commercial | Commercial and industrial | Credit Risk Grades, Doubtful
Non-PCI loans by the internal risk grading system
Total Gross loans		154
Non-PCI Loans | Commercial | Agriculture
Non-PCI loans by the internal risk grading system
Total Gross loans	45,798	53,678
Non-PCI Loans | Commercial | Agriculture | Credit Risk Grades, Pass
Non-PCI loans by the internal risk grading system
Total Gross loans	44,778	52,678
Non-PCI Loans | Commercial | Agriculture | Credit Risk Grades, Special Mention
Non-PCI loans by the internal risk grading system
Total Gross loans	120	280
Non-PCI Loans | Commercial | Agriculture | Credit Risk Grades, Substandard
Non-PCI loans by the internal risk grading system
Total Gross loans	900	720
Non-PCI Loans | Commercial | Other
Non-PCI loans by the internal risk grading system
Total Gross loans		14
Non-PCI Loans | Commercial | Other | Credit Risk Grades, Substandard
Non-PCI loans by the internal risk grading system
Total Gross loans		14
Non-PCI Loans | Consumer
Non-PCI loans by the internal risk grading system
Total Gross loans	6,492	7,978
Non-PCI Loans | Consumer | Credit Risk Grades, Pass
Non-PCI loans by the internal risk grading system
Total Gross loans	6,391	7,873
Non-PCI Loans | Consumer | Credit Risk Grades, Substandard
Non-PCI loans by the internal risk grading system
Total Gross loans	101	105
PCI loans
Non-PCI loans by the internal risk grading system
Total Gross loans	9,433	10,300
PCI loans | Credit Risk Grades, Pass
Non-PCI loans by the internal risk grading system
Total Gross loans	730	456
PCI loans | Credit Risk Grades, Special Mention
Non-PCI loans by the internal risk grading system
Total Gross loans	1,982	777
PCI loans | Credit Risk Grades, Substandard
Non-PCI loans by the internal risk grading system
Total Gross loans	6,721	8,991
PCI loans | Credit Risk Grades, Doubtful
Non-PCI loans by the internal risk grading system
Total Gross loans		76
PCI loans | Real Estate Secured
Non-PCI loans by the internal risk grading system
Total Gross loans	7,081	7,493
PCI loans | Real Estate Secured | Commercial real estate
Non-PCI loans by the internal risk grading system
Total Gross loans	5,714	4,416
PCI loans | Real Estate Secured | Commercial real estate | Credit Risk Grades, Pass
Non-PCI loans by the internal risk grading system
Total Gross loans		126
PCI loans | Real Estate Secured | Commercial real estate | Credit Risk Grades, Special Mention
Non-PCI loans by the internal risk grading system
Total Gross loans	1,760	680
PCI loans | Real Estate Secured | Commercial real estate | Credit Risk Grades, Substandard
Non-PCI loans by the internal risk grading system
Total Gross loans	3,954	3,610
PCI loans | Real Estate Secured | Residential 1 to 4 family
Non-PCI loans by the internal risk grading system
Total Gross loans	568	561
PCI loans | Real Estate Secured | Residential 1 to 4 family | Credit Risk Grades, Pass
Non-PCI loans by the internal risk grading system
Total Gross loans	451
PCI loans | Real Estate Secured | Residential 1 to 4 family | Credit Risk Grades, Substandard
Non-PCI loans by the internal risk grading system
Total Gross loans	117	561
PCI loans | Real Estate Secured | Farmland
Non-PCI loans by the internal risk grading system
Total Gross loans		1,665
PCI loans | Real Estate Secured | Farmland | Credit Risk Grades, Substandard
Non-PCI loans by the internal risk grading system
Total Gross loans		1,665
PCI loans | Real Estate Secured | Construction and land
Non-PCI loans by the internal risk grading system
Total Gross loans	799	851
PCI loans | Real Estate Secured | Construction and land | Credit Risk Grades, Pass
Non-PCI loans by the internal risk grading system
Total Gross loans	245	294
PCI loans | Real Estate Secured | Construction and land | Credit Risk Grades, Special Mention
Non-PCI loans by the internal risk grading system
Total Gross loans	51
PCI loans | Real Estate Secured | Construction and land | Credit Risk Grades, Substandard
Non-PCI loans by the internal risk grading system
Total Gross loans	503	557
PCI loans | Commercial
Non-PCI loans by the internal risk grading system
Total Gross loans	2,352	2,807
PCI loans | Commercial | Commercial and industrial
Non-PCI loans by the internal risk grading system
Total Gross loans	906	1,384
PCI loans | Commercial | Commercial and industrial | Credit Risk Grades, Pass
Non-PCI loans by the internal risk grading system
Total Gross loans	34	36
PCI loans | Commercial | Commercial and industrial | Credit Risk Grades, Special Mention
Non-PCI loans by the internal risk grading system
Total Gross loans	171	97
PCI loans | Commercial | Commercial and industrial | Credit Risk Grades, Substandard
Non-PCI loans by the internal risk grading system
Total Gross loans	701	1,175
PCI loans | Commercial | Commercial and industrial | Credit Risk Grades, Doubtful
Non-PCI loans by the internal risk grading system
Total Gross loans		76
PCI loans | Commercial | Agriculture
Non-PCI loans by the internal risk grading system
Total Gross loans	1,446	1,423
PCI loans | Commercial | Agriculture | Credit Risk Grades, Substandard
Non-PCI loans by the internal risk grading system
Total Gross loans	$ 1,446	$ 1,423

Loans and Allowance for Loan 46

Loans and Allowance for Loan and Lease Losses (Details 5) - USD ($) $ in Thousands	9 Months Ended	12 Months Ended
	Sep. 30, 2015	Dec. 31, 2014
Aging of loans held for investment
Current	$ 1,195,930	$ 1,182,868
30-59	794	56
60-89		24
Non-Accruing	10,016	10,535
Total	1,206,740	1,193,483
Accretable yield, or income expected to be collected
Balance at the beginning of the period	4,374
Accretion of income	(1,190)
Reclassifications from nonaccretable difference	861
Balance at the end of the period	4,045	4,374
Non-PCI Loans
Aging of loans held for investment
Current	1,186,668	1,172,944
30-59	794	56
60-89		24
Non-Accruing	9,845	10,159
Total	1,197,307	1,183,183
Contractually required payments receivable of loans purchased during the period
Allowance for loan losses	400	1,000
Non-PCI Loans | Real Estate Secured | Commercial real estate
Aging of loans held for investment
Current	573,330	581,971
30-59	659
Non-Accruing	2,064	2,085
Total	576,053	584,056
Non-PCI Loans | Real Estate Secured | Residential 1 to 4 family
Aging of loans held for investment
Current	154,156	126,516
Non-Accruing	171	124
Total	154,327	126,640
Non-PCI Loans | Real Estate Secured | Farmland
Aging of loans held for investment
Current	107,291	96,708
30-59	85
Total	107,376	96,708
Non-PCI Loans | Real Estate Secured | Multi-family residential
Aging of loans held for investment
Current	75,774	78,645
Total	75,774	78,645
Non-PCI Loans | Real Estate Secured | Construction and land
Aging of loans held for investment
Current	37,726	38,572
Non-Accruing	4,046	5,237
Total	41,772	43,809
Non-PCI Loans | Real Estate Secured | Home equity lines of credit
Aging of loans held for investment
Current	31,524	37,994
Non-Accruing	85	258
Total	31,609	38,252
Non-PCI Loans | Commercial | Commercial and industrial
Aging of loans held for investment
Current	154,625	151,656
30-59	50
60-89		21
Non-Accruing	3,431	1,726
Total	158,106	153,403
Non-PCI Loans | Commercial | Agriculture
Aging of loans held for investment
Current	45,798	52,992
Non-Accruing		686
Total	45,798	53,678
Non-PCI Loans | Commercial | Other
Aging of loans held for investment
Current		14
Total		14
Non-PCI Loans | Consumer
Aging of loans held for investment
Current	6,444	7,876
30-59		56
60-89		3
Non-Accruing	48	43
Total	6,492	7,978
PCI loans
Aging of loans held for investment
Current	9,262	9,924
Non-Accruing	171	376
Total	9,433	10,300
Unpaid Principal Balance	11,830	13,390
Carrying Amount	9,433	10,300
Contractually required payments receivable of loans purchased during the period
Allowance for loan losses	82	0
PCI loans | Real Estate Secured
Aging of loans held for investment
Unpaid Principal Balance	9,002	10,015
Carrying Amount	7,081	7,493
PCI loans | Real Estate Secured | Commercial real estate
Aging of loans held for investment
Current	5,661	4,416
Non-Accruing	53
Total	5,714	4,416
Unpaid Principal Balance	7,210	6,109
Carrying Amount	5,714	4,416
PCI loans | Real Estate Secured | Residential 1 to 4 family
Aging of loans held for investment
Current	568	561
Total	568	561
Unpaid Principal Balance	878	886
Carrying Amount	568	561
PCI loans | Real Estate Secured | Land
Aging of loans held for investment
Current	799
Total	799
PCI loans | Real Estate Secured | Farmland
Aging of loans held for investment
Current		1,665
Total		1,665
Unpaid Principal Balance		2,027
Carrying Amount		1,665
PCI loans | Real Estate Secured | Construction and land
Aging of loans held for investment
Current		851
Total		851
Unpaid Principal Balance	914	993
Carrying Amount	799	851
PCI loans | Commercial
Aging of loans held for investment
Unpaid Principal Balance	2,828	3,375
Carrying Amount	2,352	2,807
PCI loans | Commercial | Commercial and industrial
Aging of loans held for investment
Current	788	1,008
Non-Accruing	118	376
Total	906	1,384
Unpaid Principal Balance	1,328	1,883
Carrying Amount	906	1,384
PCI loans | Commercial | Agriculture
Aging of loans held for investment
Current	1,446	1,423
Total	1,446	1,423
Unpaid Principal Balance	1,500	1,492
Carrying Amount	$ 1,446	$ 1,423

Loans and Allowance for Loan 47

Loans and Allowance for Loan and Lease Losses (Details 6) - USD ($) $ in Thousands	Feb. 28, 2014	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014	Dec. 31, 2014
Allocation of the allowance to various segments in the loan portfolio
Balance, at the beginning of the period		$ 16,982	$ 16,635	$ 16,802	$ 17,859	$ 17,859
Charge-offs		(45)	(12)	(282)	(1,777)
Recoveries		359	164	776	705
Balance, at the end of the period		17,296	16,787	17,296	16,787	16,802
Amount of allowance attributed to:
Allowance for loan and lease losses individually evaluated for impairment		1,114		1,114		1,771
Allowance for loan and lease losses collectively evaluated for impairment		16,100		16,100		15,031
Allowance for Loans acquired with deteriorated credit quality		82		82
Recorded investment in loan individually evaluated for impairment		16,972		16,972		16,390
Recorded investment in loan collectively evaluated for impairment		1,180,335		1,180,335		1,166,752
Recorded investment in loans acquired with deteriorated credit quality		9,433		9,433		10,341
Total gross loans held for investment		1,206,740		1,206,740		1,193,483
Non-PCI Loans
Allocation of the allowance to various segments in the loan portfolio
Balance, at the beginning of the period				16,802
Balance, at the end of the period		17,214		17,214		16,802
Amount of allowance attributed to:
Total gross loans held for investment		1,197,307		1,197,307		1,183,183
Allowance for loan and lease losses				400		1,000
PCI loans
Allocation of the allowance to various segments in the loan portfolio
Balance, at the end of the period		82		82
Amount of allowance attributed to:
Total gross loans held for investment		9,433		9,433		10,300
Allowance for loan and lease losses				82		0
MISN
Amount of allowance attributed to:
Total gross loans held for investment		195,800		195,800		239,700
Allowance for loan and lease losses	$ 0
MISN | PCI loans
Amount of allowance attributed to:
Total gross loans held for investment		9,400		9,400		10,300
Commercial
Allocation of the allowance to various segments in the loan portfolio
Balance, at the beginning of the period		4,993	4,436	5,125	4,781	4,781
Charge-offs		(44)		(187)	(650)
Recoveries		327	174	636	628
Provision for loan and lease losses		209	(296)	(89)	(445)
Balance, at the end of the period		5,485	4,314	5,485	4,314	5,125
Amount of allowance attributed to:
Allowance for loan and lease losses individually evaluated for impairment		231		231		151
Allowance for loan and lease losses collectively evaluated for impairment		5,219		5,219		4,974
Allowance for Loans acquired with deteriorated credit quality		35		35
Recorded investment in loan individually evaluated for impairment		5,510		5,510		4,633
Recorded investment in loan collectively evaluated for impairment		198,394		198,394		202,450
Recorded investment in loans acquired with deteriorated credit quality		2,352		2,352		2,819
Total gross loans held for investment		206,256		206,256		209,902
Commercial | Non-PCI Loans
Amount of allowance attributed to:
Total gross loans held for investment		203,904		203,904		207,095
Commercial | PCI loans
Amount of allowance attributed to:
Total gross loans held for investment		2,352		2,352		2,807
Construction and land
Allocation of the allowance to various segments in the loan portfolio
Balance, at the beginning of the period		1,940	3,054	2,000	3,660	3,660
Charge-offs				(34)
Recoveries		24	9	48	32
Provision for loan and lease losses		(599)	(721)	(649)	(1,350)
Balance, at the end of the period		1,365	2,342	1,365	2,342	2,000
Amount of allowance attributed to:
Allowance for loan and lease losses individually evaluated for impairment						1,472
Allowance for loan and lease losses collectively evaluated for impairment						528
Recorded investment in loan individually evaluated for impairment						6,346
Recorded investment in loan collectively evaluated for impairment						37,461
Recorded investment in loans acquired with deteriorated credit quality						853
Consumer
Allocation of the allowance to various segments in the loan portfolio
Balance, at the beginning of the period		171	100	202	131	131
Charge-offs		(1)	(2)	(6)	(8)
Recoveries		3	1	11	10
Provision for loan and lease losses		18	10	(16)	(24)
Balance, at the end of the period		191	109	191	109	202
Amount of allowance attributed to:
Allowance for loan and lease losses collectively evaluated for impairment		191		191		202
Recorded investment in loan individually evaluated for impairment		163		163		112
Recorded investment in loan collectively evaluated for impairment		6,329		6,329		7,866
Total gross loans held for investment		6,492		6,492		7,978
Consumer | Non-PCI Loans
Amount of allowance attributed to:
Total gross loans held for investment		6,492		6,492		7,978
Unallocated
Allocation of the allowance to various segments in the loan portfolio
Balance, at the beginning of the period		243	298	346	262	262
Provision for loan and lease losses		(243)	205	(346)	241
Balance, at the end of the period			503		503	346
Amount of allowance attributed to:
Allowance for loan and lease losses collectively evaluated for impairment						346
Other real estate secured
Allocation of the allowance to various segments in the loan portfolio
Balance, at the beginning of the period		9,635	8,747	9,129	9,025	9,025
Charge-offs			(10)	(55)	(1,119)
Recoveries		5		81	35
Adjustments			(20)
Provision for loan and lease losses		615	802	1,100	1,578
Balance, at the end of the period		10,255	9,519	10,255	$ 9,519	9,129
Amount of allowance attributed to:
Allowance for loan and lease losses individually evaluated for impairment		94		94		148
Allowance for loan and lease losses collectively evaluated for impairment		10,120		10,120		8,981
Allowance for Loans acquired with deteriorated credit quality		41		41
Recorded investment in loan individually evaluated for impairment		6,036		6,036		5,299
Recorded investment in loan collectively evaluated for impairment		939,103		939,103		918,975
Recorded investment in loans acquired with deteriorated credit quality		6,282		6,282		$ 6,669
Provision for loan losses, transfer from C&I to Land related to the re-characterization of a loan as part of a TDR			$ (20)
Land | Construction and land
Amount of allowance attributed to:
Allowance for loan and lease losses individually evaluated for impairment		789		789
Allowance for loan and lease losses collectively evaluated for impairment		570		570
Allowance for Loans acquired with deteriorated credit quality		6		6
Recorded investment in loan individually evaluated for impairment		5,263		5,263
Recorded investment in loan collectively evaluated for impairment		36,509		36,509
Recorded investment in loans acquired with deteriorated credit quality		$ 799		$ 799

Income Taxes (Details)

Income Taxes (Details) - USD ($) $ in Thousands	Sep. 30, 2015	Dec. 31, 2014
Income Taxes
Deferred tax valuation allowance	$ 0	$ 0
Deferred tax assets	21,422	$ 24,920
Loss of NOL utilization	$ 0

Goodwill and Other Intangible49

Goodwill and Other Intangible Assets (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014	Dec. 31, 2014
Core deposit intangible
Gross Carrying Amount	$ 9,261		$ 9,261
Accumulated Amortization	(4,701)		(4,701)
Net Carrying Amount	4,560		4,560
Estimated Amortization
Year 2,015	(262)		(262)
Year 2,016	(944)		(944)
Year 2,017	(588)		(588)
Year 2,018	(549)		(549)
Year 2,019	(522)		(522)
Year 2,020	(441)		(441)
Goodwill	24,885		24,885		$ 24,885
Other Intangible Assets, Net	4,560		4,560		5,347
Amortization of Intangible Assets	263	$ 297	787	$ 760
Year 2,015
Core deposit intangible
Net Carrying Amount	4,298		4,298		4,560
Year 2,016
Core deposit intangible
Net Carrying Amount	3,354		3,354		4,298
Year 2,017
Core deposit intangible
Net Carrying Amount	2,766		2,766		3,354
Year 2,018
Core deposit intangible
Net Carrying Amount	2,217		2,217		2,766
Year 2,019
Core deposit intangible
Net Carrying Amount	1,695		1,695		2,217
Year 2,020
Core deposit intangible
Net Carrying Amount	$ 1,254		$ 1,254		$ 1,695

Share-based Compensation Plan50

Share-based Compensation Plans (Details) $ / shares in Units, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2015USD ($)plan$ / sharesshares	Sep. 30, 2014USD ($)	Sep. 30, 2015USD ($)plan$ / sharesshares	Sep. 30, 2014USD ($)$ / shares	Dec. 31, 2014planshares
Summary of the expenses the Company has recognized related to share-based compensation
Aggregate number of shares that may be granted during any calendar year per individual			250,000
Share-based compensation expense | $	$ 279	$ 257	$ 814	$ 723
Unrecognized compensation expense | $	$ 2,115	2,223	$ 2,115	2,223
Number of shares
Expired (in shares)			(11,812)
Weighted Average Exercise Price
Expired (in dollars per share) | $ / shares			$ 13.18
2015 Equity Incentive Plan
Summary of the expenses the Company has recognized related to share-based compensation
Number of share-based employee compensation plans | plan	1		1
1997 Stock Option Plan and 2005 Equity Based Compensation Plan
Summary of the expenses the Company has recognized related to share-based compensation
Number of share-based employee compensation plans | plan					2
Number of Shares
Granted (in shares)			0
Maximum | 2015 Equity Incentive Plan
Summary of the expenses the Company has recognized related to share-based compensation
Maximum number of shares that may be issued	2,500,000		2,500,000
Stock options
Summary of the expenses the Company has recognized related to share-based compensation
Share-based compensation expense | $	$ 126	109	$ 374	370
Unrecognized compensation expense | $	$ 1,133	1,156	$ 1,133	$ 1,156
Weighted-average period over which expense is expected to be recognized			2 years 9 months 18 days
Assumptions used in the calculation of the weighted average fair value of options granted
Expected volatility (as a percent)			36.38%	49.83%
Expected term			5 years	5 years 7 months 28 days
Dividend yield (as a percent)			2.82%	0.59%
Risk free rate (as a percent)			1.54%	1.76%
Weighted-average grant date fair value (in dollars per share) | $ / shares			$ 1.97	$ 3.39
Number of shares
Options Available for Grant (in shares)	2,235,402		2,235,402		2,003,176
Options outstanding, at the beginning of the period (in shares)			742,557
Granted (in shares)			375,429
Forfeited (in shares)			(98,352)
Exercised (in shares)			(47,554)
Options outstanding, at the end of the period (in shares)	960,268		960,268
Weighted Average Exercise Price
Options outstanding, at the beginning of the period (in dollars per share) | $ / shares			$ 6.83
Granted (in dollars per share) | $ / shares			7.70
Forfeited (in dollars per share) | $ / shares			6.94
Exercised (in dollars per share) | $ / shares			4.90
Options outstanding, at the end of the period (in dollars per share) | $ / shares	$ 7.18		$ 7.18
Options vested or expected to vest
Shares	908,273		908,273
Weighted Average Exercise Price (in dollars per share) | $ / shares	$ 7.16		$ 7.16
Weighted Average Remaining Contractual Life			7 years 11 months 1 day
Aggregate Intrinsic Value | $	$ 1,028,678		$ 1,028,678
Options exercisable
Shares	350,160		350,160
Weighted Average Exercise Price (in dollars per share) | $ / shares	$ 6.81		$ 6.81
Weighted Average Remaining Contractual Life			6 years 1 month 2 days
Aggregate Intrinsic Value | $	$ 705,664		$ 705,664
Aggregate intrinsic value of options exercised
Aggregate intrinsic value of options exercised | $			$ 153
Stock options | Minimum
Summary of the expenses the Company has recognized related to share-based compensation
Vesting period			3 years
Stock options | Maximum
Summary of the expenses the Company has recognized related to share-based compensation
Vesting period			5 years
Restricted stock
Summary of the expenses the Company has recognized related to share-based compensation
Share-based compensation expense | $	153	148	$ 440	$ 353
Unrecognized compensation expense | $	$ 982	$ 1,067	$ 982	$ 1,067
Weighted-average period over which expense is expected to be recognized			1 year 10 months 24 days
Number of Shares
Balance at the beginning of the period (in shares)			206,443
Granted (in shares)			84,951
Vested (in shares)			(88,534)
Forfeited (in shares)			(30,121)
Balance at the end of the period (in shares)	172,739		172,739
Average Grant Date fair Value
Balance at the beginning of the period (in dollars per share) | $ / shares			$ 6.65
Granted (in dollars per share) | $ / shares			7.87
Vested (in dollars per share) | $ / shares			6.49
Forfeited (in dollars per share) | $ / shares			7.10
Balance at the end of the period (in dollars per share) | $ / shares	$ 7.26		$ 7.26
Restricted stock | Minimum
Summary of the expenses the Company has recognized related to share-based compensation
Vesting period			3 years
Restricted stock | Maximum
Summary of the expenses the Company has recognized related to share-based compensation
Vesting period			5 years
Performance-based
Average Grant Date fair Value
Performance based grant (in shares)			23,408

Shareholders' Equity (Details)

Shareholders' Equity (Details)	Sep. 30, 2015	Dec. 31, 2014	Sep. 30, 2014
Shareholders' Equity
Capital conservation buffer (as a percent)	2.50%
Capital conservation buffer for 2016 (as a percent)	0.625%
Capital conservation buffer for 2017 (as a percent)	1.25%
Capital conservation buffer for 2018 (as a percent)	1.875%
Capital conservation buffer for 2019 (as a percent)	2.50%
Common equity Tier I Capital
Regulatory Standard, Common equity Tier I Capital Well Capitalized Ratio (as a percent)	6.50%
Leverage ratio
Regulatory Standard, Leverage ratio Well Capitalized Ratio (as a percent)	5.00%	5.00%
Tier I capital to risk weighted assets
Regulatory Standard, Well Capitalized Ratio (as a percent)	8.00%	6.00%
Total risk based capital to risk weighted assets
Regulatory Standard, Total risk based capital Well Capitalized Ratio (as a percent)	10.00%	10.00%
Minimum
Shareholders' Equity
CET I to risk-weighted assets	4.50%
Total risk based capital to risk weighted assets
Regulatory Standard, Total risk based capital Well Capitalized Ratio (as a percent)	6.50%
Calculation of Risk-Weighted Assets Category One
Shareholders' Equity
Ratio risk-weighted assets (as a percent)	0.00%
Calculation of Risk-Weighted Assets Category Two
Shareholders' Equity
Ratio risk-weighted assets (as a percent)	20.00%
Calculation of Risk-Weighted Assets Category Three
Shareholders' Equity
Ratio risk-weighted assets (as a percent)	50.00%
Calculation of Risk-Weighted Assets Category Four
Shareholders' Equity
Ratio risk-weighted assets (as a percent)	100.00%
Heritage Oaks Bancorp
Common equity Tier I Capital
Actual regulatory, Common equity Tier I Capital Ratio (as a percent	12.81%
Leverage ratio
Actual regulatory, Leverage ratio (as a percent)	9.96%	10.22%	10.00%
Tier I capital to risk weighted assets
Actual regulatory, Tier I capital (as a percent)	13.20%	13.13%	12.87%
Total risk based capital to risk weighted assets
Actual regulatory, Total risk based capital (as a percent)	14.46%	14.38%	14.12%
Heritage Oaks Bank
Common equity Tier I Capital
Actual regulatory, Common equity Tier I Capital Ratio (as a percent	12.52%
Leverage ratio
Actual regulatory, Leverage ratio (as a percent)	9.44%	9.83%	9.77%
Tier I capital to risk weighted assets
Actual regulatory, Tier I capital (as a percent)	12.52%	12.63%	12.58%
Total risk based capital to risk weighted assets
Actual regulatory, Total risk based capital (as a percent)	13.77%	13.88%	13.83%

Shareholders' Equity (Details 2

Shareholders' Equity (Details 2) - USD ($) $ / shares in Units, $ in Thousands	Oct. 28, 2015	Aug. 31, 2015	Sep. 30, 2015	Jun. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Jun. 01, 2015	Mar. 02, 2015	Dec. 31, 2014
Preferred Stock
Preferred stock, shares authorized			5,000,000			5,000,000		5,000,000			5,000,000
Cash dividend paid on common and preferred stock (in dollars per share)			$ 0.03			$ 0.03		$ 0.03	$ 0.06	$ 0.05
Cash dividend paid on common stock (in dollars per share)		$ 0.06
Cash dividend declared (in dollars per share)			$ 0.06		$ 0.03	$ 0.17	$ 0.03
Shares repurchased			0			3,696		55,428
Average price per share stock repurchase						$ 7.52		$ 7.47
Maximum
Preferred Stock
Repurchase of shares amount authorized				$ 5,000
Subsequent Event
Preferred Stock
Cash dividend declared (in dollars per share)	$ 0.06
Series C preferred stock
Preferred Stock
Issuance of stock (in shares)						348,697
Conversion price (in dollars per share)							$ 3.25
Remaining beneficial conversion feature				$ 70
Preferred stock, shares issued			0			0		0			348,697
Preferred stock, shares outstanding			0			0		0			348,697

Earnings Per Share (Details)

Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014
Calculation of both basic and diluted earnings (loss) per common share
Net income	$ 4,002	$ 3,429	$ 11,871	$ 4,613
Accretion on preferred stock			70
Net income available to common shareholders	$ 4,002	$ 3,429	$ 11,801	$ 4,613
Weighted average shares outstanding	34,158,081	33,992,465	34,111,079	32,322,194
Basic earnings per common share (in dollars per share)	$ 0.12	$ 0.10	$ 0.35	$ 0.14
Dilutive effect of share-based compensation awards (in shares)	124,286	153,735	147,285	197,324
Weighted average diluted shares outstanding	34,282,367	34,146,200	34,258,364	32,519,518
Diluted earnings per common share (in dollars per share)	$ 0.12	$ 0.10	$ 0.34	$ 0.14
Stock options
Shares excluded from the calculation of diluted earnings per share
Shares excluded from the calculation of diluted earnings per share	126,000	160,000	35,000	114,000

Commitments and Contingencies54

Commitments and Contingencies (Details) - Heritage Oaks Bank - USD ($) $ in Thousands	9 Months Ended	12 Months Ended
	Sep. 30, 2015	Dec. 31, 2014
Commitments and Contingencies
Total commitments and standby letters of credit	$ 282,984	$ 253,275
Outstanding financial fixed rate commitments	26,300	35,700
Outstanding financial variable rate commitments	256,700	217,500
Commitments to extend credit
Commitments and Contingencies
Total commitments and standby letters of credit	270,024	237,733
Standby letters of credit
Commitments and Contingencies
Total commitments and standby letters of credit	12,960	15,542
Standby letters of credit | One customer
Commitments and Contingencies
Total commitments and standby letters of credit	$ 10,400	$ 10,400

Subsequent Events (Details)

Subsequent Events (Details) - $ / shares	Oct. 28, 2015	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014
Subsequent events
Cash dividend declared (in dollars per share)		$ 0.06	$ 0.03	$ 0.17	$ 0.03
Subsequent Event
Subsequent events
Cash dividend declared (in dollars per share)	$ 0.06