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Loans and Allowance for Credit Losses
 12 Months Ended
Dec. 31, 2024
Receivables [Abstract]  
Financing Receivables
NOTE 5 - LOANS AND ALLOWANCE FOR CREDIT LOSSES
Loans and leases, net of unearned income

Loans and leases, net of unearned income are summarized as follows as of December 31:
20242023
(dollars in thousands)
Real estate - commercial mortgage$9,601,858 $8,127,728 
Commercial and industrial(1)
4,605,589 4,545,552 
Real-estate - residential mortgage6,349,643 5,325,923 
Real-estate - home equity1,160,616 1,047,184 
Real-estate - construction1,394,899 1,239,075 
Consumer616,856 729,318 
Leases and other loans(2)
315,458 336,314 
Net loans$24,044,919 $21,351,094 
(1) Includes no unearned income for December 31, 2024 and $41.0 thousand at December 31, 2023.
(2) Includes unearned income of $35.6 million and $38.0 million at December 31, 2024 and December 31, 2023, respectively.

The Corporation has extended credit to officers and directors of the Corporation and to their associates. These related-party loans are made on substantially the same terms, including interest rates and collateral, as those prevailing at the time for comparable transactions with unrelated persons and do not involve more than the normal risk of collection or present other unfavorable features. The aggregate dollar amount of these loans, including unadvanced commitments, was $166.2 million and $162.5 million as of December 31, 2024 and 2023, respectively. During 2024, additions totaled $9.1 million and repayments totaled $5.4 million for related-party loans.

Allowance for Credit Losses

The following table summarizes the ACL - loans balance and the reserve for OBS credit exposures balance as of December 31, 2024 and 2023:

20242023
(dollars in thousands)
ACL - loans $379,156 $293,404 
Reserve for OBS credit exposures(1)
$14,161 $17,254 
(1) Included in other liabilities on the Consolidated Balance Sheets.
The following table presents the activity in the ACL for the years ended December 31:
202420232022
(dollars in thousands)
Balance at beginning of period$293,404 $269,366 $249,001 
CECL Day 1 Provision(1)
23,444 — 7,954 
Initial PCD allowance for credit losses54,631 — 1,135 
Loans charged off(54,429)(39,201)(21,472)
Recoveries of loans previously charged off9,984 10,129 14,092 
Net loans (charged off) recovered(44,445)(29,072)(7,380)
Provision for credit losses(1) (2)
52,122 53,110 18,656 
Balance at end of period$379,156 $293,404 $269,366 
Provision for OBS credit exposures(1)
$(3,930)$926 $1,411 
Reserve for OBS credit exposures$14,161 $17,254 $16,328 
(1) The sum of these amounts are reflected in the provision for credit losses in the Consolidated Statements of Income.
(2) Provision only includes the portion related to net loans.


The following table presents the activity in the ACL by portfolio segment:
Real Estate -
Commercial
Mortgage		Commercial and IndustrialReal Estate -
Residential
Mortgage		Consumer and Real Estate -
Home
Equity		Real Estate -
Construction		Leases and other loansTotal
 (dollars in thousands)
Balance at December 31, 2022$69,456 $70,116 $83,250 $26,429 $10,743 $9,372 $269,366 
Loans charged off(17,999)(9,246)(62)(7,514)— (4,380)(39,201)
Recoveries of loans previously charged off1,076 3,473 421 3,198 858 1,103 10,129 
Net loans (charged off) recovered(16,923)(5,773)359 (4,316)858 (3,277)(29,072)
Provision for loan losses(1)(2)
60,032 9,923 (10,323)(4,509)694 (2,707)53,110 
Balance at December 31, 2023112,565 74,266 73,286 17,604 12,295 3,388 293,404 
CECL Day 1 Provision(1)
6,648 1,121 14,920 445 310 — 23,444 
Initial PCD allowance for credit losses41,559 10,463 565 357 1,687 — 54,631 
Loans charged off(13,186)(26,585)(1,472)(8,490)— (4,696)(54,429)
Recoveries of loans previously charged off603 4,440 472 3,357 382 730 9,984 
Net loans (charged off) recovered(12,583)(22,145)(1,000)(5,133)382 (3,966)(44,445)
Provision for loan losses(1)(2)
9,992 28,507 (6,440)6,124 10,466 3,473 52,122 
Balance at December 31, 2024$158,181 $92,212 $81,331 $19,397 $25,140 $2,895 $379,156 
(1) These amounts are reflected in the provision for credit loss in the Consolidated Statements of Income.
(2) Provision included in the table only includes the portion related to net loans.

The ACL may include qualitative adjustments intended to capture the impact of uncertainties not reflected in the quantitative models. In determining qualitative adjustments, management considers changes in national, regional, and local economic and business conditions and their impact on the lending environment, including underwriting standards and other factors affecting credit losses over the remaining life of each loan.

The increase in ACL in 2024 was largely due to loans acquired in the Republic First Transaction. The increase in ACL in 2023 was primarily due to loan growth, changes to the macroeconomic outlook, net charge-offs and risk migration.
Collateral-Dependent Loans

A loan or a lease is considered to be collateral-dependent when the debtor is experiencing financial difficulty and repayment is expected to be provided substantially through the sale or operation of the collateral. For all classes of loans and leases deemed collateral-dependent, the Corporation elected the practical expedient to estimate expected credit losses based on the collateral’s fair value less costs to sell. Substantially all of the collateral supporting collateral-dependent loans or leases consists of various types of real estate, including residential properties, commercial properties, such as retail centers, office buildings, and lodging, agricultural land, and vacant land. Commercial and industrial loans may also be secured by real estate.
All loans individually evaluated for impairment are measured for losses on a quarterly basis. As of December 31, 2024 and 2023, substantially all of the Corporation's individually evaluated loans with total commitments greater than or equal to $1.0 million were measured based on the estimated fair value of each loan's collateral, if any.

As of December 31, 2024 and 2023, approximately 90% and 78%, respectively, of loans evaluated individually for impairment with principal balances greater than or equal to $1.0 million, whose primary collateral consisted of real estate, were measured at estimated fair value using appraisals performed by state certified third-party appraisers that had been updated in the preceding 12 months.

Non-accrual Loans

The following table presents total non-accrual loans, by class segment:

20242023
With a Related AllowanceWithout a Related AllowanceTotalWith a Related AllowanceWithout a Related AllowanceTotal
(dollars in thousands)
Real estate - commercial mortgage$31,654 $67,843 $99,497 $23,338 $21,467 $44,805 
Commercial and industrial17,011 25,206 42,217 12,410 27,542 39,952 
Real estate - residential mortgage23,387 2,013 25,400 18,806 2,018 20,824 
Real estate - home equity8,513 78 8,591 4,649 104 4,753 
Real estate - construction1,746 — 1,746 341 1,000 1,341 
Consumer8 — 8 52 — 52 
Leases and other loans1,801 10,033 11,834 9,255 638 9,893 
Total$84,120 $105,173 $189,293 $68,851 $52,769 $121,620 

As of December 31, 2024 and December 31, 2023, there were $105.2 million and $52.8 million, respectively, of non-accrual loans that did not have a specific valuation allowance within the ACL. The estimated fair values of the collateral securing these loans exceeded their carrying amount, or the loans were previously charged down to realizable collateral values. Accordingly, no specific valuation allowance was considered to be necessary. The amount of interest income on non-accrual loans that was recognized was approximately $1.0 million in 2024 and $1.5 million in 2023.

Asset Quality

Maintaining an appropriate ACL is dependent on various factors, including the ability to identify potential problem loans in a timely manner. For commercial construction loans, commercial and industrial loans, and commercial real estate loans, an internal risk rating process is used. The Corporation believes that internal risk ratings are the most relevant credit quality indicator for these types of loans. The migration of loans through the various internal risk categories is a significant component of the ACL methodology for these loans, which bases the PD on this migration. Assigning risk ratings involves judgment. The Corporation's loan review officers provide a separate assessment of risk rating accuracy. Risk ratings may be changed based on the ongoing monitoring procedures performed by loan officers or credit administration staff, or if specific loan review assessments identify a deterioration or an improvement in a loan.
The following table summarizes designated internal risk rating categories by portfolio segment and loan class, by origination year, in the current period:
December 31, 2024
(dollars in thousands)
Term Loans Amortized Cost Basis by Origination YearRevolving LoansRevolving Loans converted to Term Loans
AmortizedAmortized
20242023202220212020PriorCost BasisCost BasisTotal
Real estate - commercial mortgage
Pass$623,742 $898,296 $1,138,669 $1,316,000 $1,077,625 $3,414,138 $69,942 $9,646 $8,548,058 
Special Mention4,441 73,348 149,280 157,543 28,734 107,099 10,978 — 531,423 
Substandard or Lower4,831 44,665 102,952 95,617 75,097 193,922 1,380 3,913 522,377 
Total real estate - commercial mortgage633,014 1,016,309 1,390,901 1,569,160 1,181,456 3,715,159 82,300 13,559 9,601,858 
Real estate - commercial mortgage
Current period gross charge-offs— (126)(84)— — (12,950)— (26)(13,186)
Commercial and industrial
Pass435,917 486,720 512,622 261,603 268,194 684,931 1,375,201 6,346 4,031,534 
Special Mention9,928 8,333 19,931 18,888 4,844 58,632 117,940 313 238,809 
Substandard or Lower10,795 16,593 34,748 10,183 12,496 49,439 176,755 24,237 335,246 
Total commercial and industrial456,640 511,646 567,301 290,674 285,534 793,002 1,669,896 30,896 4,605,589 
Commercial and industrial
Current period gross charge-offs(612)(3,709)(2,560)(4,587)(317)(7,612)(3,553)(3,635)(26,585)
Real estate - construction(1)
Pass197,206 494,072 157,296 37,438 8,784 41,480 30,608 619 967,503 
Special Mention— 10,612 80,651 69,109 938 — — — 161,310 
Substandard or Lower— — 14,407 10,399 — 20,350 121 1,906 47,183 
Total real estate - construction197,206 504,684 252,354 116,946 9,722 61,830 30,729 2,525 1,175,996 
Real estate - construction(1)
Current period gross charge-offs— — — — — — — — — 
Total
Pass$1,256,865 $1,879,088 $1,808,587 $1,615,041 $1,354,603 $4,140,549 $1,475,751 $16,611 $13,547,095 
Special Mention14,369 92,293 249,862 245,540 34,516 165,731 128,918 313 931,542 
Substandard or Lower15,626 61,258 152,107 116,199 87,593 263,711 178,256 30,056 904,806 
Total$1,286,860 $2,032,639 $2,210,556 $1,976,780 $1,476,712 $4,569,991 $1,782,925 $46,980 $15,383,443 
(1) Excludes real estate - construction - other.


Total criticized and classified loans increased $911.4 million, or 98.5%, compared to December 31, 2023.


The increase of $454.6 million in special mention loans as of December 31, 2024 was primarily due to loans acquired in the Republic First Transaction with a balance of $350.4 million as of December 31, 2024. The increase of $456.8 million in substandard or lower loans as of December, 31, 2024 was partially due to loans acquired in the Republic First Transaction with a balance of $193.0 million as of December 31, 2024.
The following table summarizes designated internal risk rating categories by portfolio segment and loan class, by origination year, in the prior period:
December 31, 2023
(dollars in thousands)
Term Loans Amortized Cost Basis by Origination YearRevolving LoansRevolving Loans converted to Term Loans
AmortizedAmortized
20232022202120202019PriorCost BasisCost BasisTotal
Real estate - commercial mortgage
Pass$783,673 $993,017 $1,203,852 $984,958 $721,857 $2,822,155 $59,253 $31,636 $7,600,401 
Special Mention2,767 43,904 105,185 7,862 35,289 105,786 1,760 — 302,553 
Substandard or Lower366 20,958 31,304 49,142 26,579 95,621 804 — 224,774 
Total real estate - commercial mortgage786,806 1,057,879 1,340,341 1,041,962 783,725 3,023,562 61,817 31,636 8,127,728 
Real estate - commercial mortgage
Current period gross charge-offs— — — — — (424)— (17,575)(17,999)
Commercial and industrial
Pass626,386 590,132 330,576 341,218 272,126 598,838 1,443,203 10,736 4,213,215 
Special Mention7,936 9,548 16,499 3,577 6,817 18,487 72,775 198 135,837 
Substandard or Lower247 25,184 4,611 3,843 18,988 31,663 105,230 6,734 196,500 
Total commercial and industrial634,569 624,864 351,686 348,638 297,931 648,988 1,621,208 17,668 4,545,552 
Commercial and industrial
Current period gross charge-offs— (299)— — — (249)(682)(8,016)(9,246)
Real estate - construction(1)
Pass322,922 258,080 261,583 37,426 9,510 34,097 13,677 — 937,295 
Special Mention— 12,622 25,898 — — — — — 38,520 
Substandard or Lower— 521 2,229 — 340 21,284 168 2,229 26,771 
Total real estate - construction322,922 271,223 289,710 37,426 9,850 55,381 13,845 2,229 1,002,586 
Real estate - construction(1)
Current period gross charge-offs— — — — — — — — — 
Total
Pass$1,732,981 $1,841,229 $1,796,011 $1,363,602 $1,003,493 $3,455,090 $1,516,133 $42,372 $12,750,911 
Special Mention10,703 66,074 147,582 11,439 42,106 124,273 74,535 198 476,910 
Substandard or Lower613 46,663 38,144 52,985 45,907 148,568 106,202 8,963 448,045 
Total$1,744,297 $1,953,966 $1,981,737 $1,428,026 $1,091,506 $3,727,931 $1,696,870 $51,533 $13,675,866 
(1) Excludes real estate - construction - other.
The Corporation considers the performance of the loan portfolio and its impact on the ACL. The Corporation does not assign internal risk ratings to smaller balance, homogeneous loans, such as home equity, residential mortgage, construction loans to individuals secured by residential real estate, consumer and other loans. For these loans, the most relevant credit quality indicator is delinquency status, and the Corporation evaluates credit quality based on the aging status of the loan. The following tables present the amortized cost of these loans based on payment activity, by origination year, for the periods shown:
December 31, 2024
(dollars in thousands)
Term Loans Amortized Cost Basis by Origination YearRevolving LoansRevolving Loans converted to Term Loans
AmortizedAmortized
20242023202220212020PriorCost BasisCost BasisTotal
Real estate - residential mortgage
Performing$470,918 $728,630 $1,515,521 $1,726,991 $1,022,116 $839,566 $— $— $6,303,742 
Nonperforming87 1,358 5,118 3,232 5,523 30,583 — — 45,901 
Total real estate - residential mortgage471,005 729,988 1,520,639 1,730,223 1,027,639 870,149 — — 6,349,643 
Real estate - residential mortgage
Current period gross charge-offs— (172)(106)(12)(43)(888)— (251)(1,472)
Consumer and real estate - home equity
Performing178,722 116,370 211,647 65,412 48,201 188,442 913,920 40,384 1,763,098 
Nonperforming236 848 918 963 753 4,571 2,893 3,192 14,374 
Total consumer and real estate - home equity178,958 117,218 212,565 66,375 48,954 193,013 916,813 43,576 1,777,472 
Consumer and real estate - home equity
Current period gross charge-offs(118)(1,016)(1,552)(790)(398)(2,704)(75)(1,837)(8,490)
Leases and other loans
Performing123,991 89,006 52,724 16,894 10,830 9,996 — — 303,441 
Nonperforming— — 1,922 744 23 9,328 — — 12,017 
Total leases and other loans123,991 89,006 54,646 17,638 10,853 19,324 — — 315,458 
Leases and other loans
Current period gross charge-offs(1,977)(913)(335)(334)(192)(770)— (175)(4,696)
Construction - other
Performing138,440 61,848 15,710 1,499 — — — — 217,497 
Nonperforming— — 1,406 — — — — — 1,406 
Total construction - other138,440 61,848 17,116 1,499 — — — — 218,903 
Construction - other
Current period gross charge-offs— — — — — — — — — 
Total
Performing$912,071 $995,854 $1,795,602 $1,810,796 $1,081,147 $1,038,004 $913,920 $40,384 $8,587,778 
Nonperforming323 2,206 9,364 4,939 6,299 44,482 2,893 3,192 73,698 
Total$912,394 $998,060 $1,804,966 $1,815,735 $1,087,446 $1,082,486 $916,813 $43,576 $8,661,476 
December 31, 2023
(dollars in thousands)
Term Loans Amortized Cost Basis by Origination YearRevolving LoansRevolving Loans converted to Term Loans
AmortizedAmortized
20232022202120202019PriorCost BasisCost BasisTotal
Real estate - residential mortgage
Performing$623,247 $1,126,656 $1,682,759 $984,050 $260,049 $607,133 $— $— $5,283,894 
Nonperforming— 1,720 4,888 4,701 6,233 24,487 — — 42,029 
Total real estate - residential mortgage623,247 1,128,376 1,687,647 988,751 266,282 631,620 — — 5,325,923 
Real estate - residential mortgage
Current period gross charge-offs— — — — — — — (62)(62)
Consumer and real estate - home equity
Performing272,571 276,373 85,985 62,426 37,667 204,913 805,645 20,044 1,765,624 
Nonperforming295 455 866 282 354 5,526 1,439 1,661 10,878 
Total consumer and real estate - home equity272,866 276,828 86,851 62,708 38,021 210,439 807,084 21,705 1,776,502 
Consumer and real estate - home equity loans
Current period gross charge-offs(119)— — — — (525)(283)(6,587)(7,514)
Leases and other loans
Performing166,490 83,641 27,755 22,304 16,246 9,867 — — 326,303 
Nonperforming— 118 — — — 9,893 — — 10,011 
Total leases and other166,490 83,759 27,755 22,304 16,246 19,760 — — 336,314 
Leases and other loans
Current period gross charge-offs(471)(521)(246)(128)(82)(656)(765)(1,511)(4,380)
Construction - other
Performing127,382 93,319 13,698 555 — — — — 234,954 
Nonperforming— 1,535 — — — — — — 1,535 
Total construction - other127,382 94,854 13,698 555 — — — — 236,489 
Construction - other
Current period gross charge-offs— — — — — — — — — 
Total
Performing$1,189,690 $1,579,989 $1,810,197 $1,069,335 $313,962 $821,913 $805,645 $20,044 $7,610,775 
Nonperforming295 3,828 5,754 4,983 6,587 39,906 1,439 1,661 64,453 
Total$1,189,985 $1,583,817 $1,815,951 $1,074,318 $320,549 $861,819 $807,084 $21,705 $7,675,228 
The following table presents non-performing assets:
December 31,
2024		December 31,
2023
 (dollars in thousands)
Non-accrual loans$189,293 $121,620 
Loans 90 days or more past due and still accruing30,781 31,721 
Total non-performing loans220,074 153,341 
OREO(1)
2,621 896 
Total non-performing assets$222,695 $154,237 
(1) Excludes $17.5 million and $10.9 million of residential mortgage properties for which formal foreclosure proceeding were in process as of December 31, 2024 and 2023, respectively.

The following tables present the aging of the amortized cost basis of loans, by class segment:
30-5960-89≥ 90 Days
Days PastDays PastPast Due Non-
DueDueand AccruingAccrualCurrentTotal
(dollars in thousands)
December 31, 2024
Real estate - commercial mortgage$32,715 $16,684 $2,862 $99,497 $9,450,100 $9,601,858 
Commercial and industrial(1)
6,031 3,636 1,460 42,217 4,552,245 4,605,589 
Real estate - residential mortgage59,593 5,946 20,501 25,400 6,238,203 6,349,643 
Real estate - home equity6,778 1,057 4,758 8,591 1,139,432 1,160,616 
Real estate - construction3,549 5,163 — 1,746 1,384,441 1,394,899 
Consumer6,779 1,627 1,017 8 607,425 616,856 
Leases and other loans(1)
269 105 183 11,834 303,067 315,458 
Total$115,714 $34,218 $30,781 $189,293 $23,674,913 $24,044,919 
(1) Includes unearned income.
30-59 Days Past
Due		60-89
Days Past
Due		≥ 90 Days
Past Due
and
Accruing		Non-
accrual		CurrentTotal
(dollars in thousands)
December 31, 2023
Real estate - commercial mortgage$4,408 $1,341 $1,722 $44,805 $8,075,452 $8,127,728 
Commercial and industrial(1)
5,620 1,656 1,068 39,952 4,497,256 4,545,552 
Real estate - residential mortgage49,145 10,838 21,205 20,824 5,223,911 5,325,923 
Real estate - home equity8,142 2,075 5,326 4,753 1,026,888 1,047,184 
Real estate - construction4,185 451 1,535 1,341 1,231,563 1,239,075 
Consumer8,361 1,767 747 52 718,391 729,318 
Leases and other loans(1)
146 722 118 9,893 325,435 336,314 
Total$80,007 $18,850 $31,721 $121,620 $21,098,896 $21,351,094 
(1) Includes unearned income.

Loan Modifications to Borrowers Experiencing Financial Difficulty

The Corporation modifies loans by providing a concession when deemed appropriate. Depending on the circumstances, a term extension, interest rate reduction or principal forgiveness may be granted. In certain instances a combination of concessions may be provided to a borrower.
When principal forgiveness is provided, the amount of principal forgiven is deemed to be uncollectible and the amortized cost basis of the loan is reduced by the amount of the forgiven portion, with a corresponding reduction to the ACL.

The following table presents the amortized cost basis of the loans modified to borrowers experiencing financial difficulty, disaggregated by class of financing receivable and type of concession granted:

Term Extension
20242023
Amortized Cost Basis% of Class of Financing ReceivableAmortization Cost Basis% of Class of Financing Receivable
(dollars in thousands)
Real estate - commercial mortgage$20,501 0.21 %$2,944 0.04 %
Commercial and industrial3,913 0.08 11,970 0.26 
Real estate - residential mortgage11,604 0.18 8,182 0.15 
Real estate - home equity379 0.03 — — 
Real estate - construction595 0.04 — — 
Total$36,992 $23,096 

Interest Rate Reduction and Term Extension
20242023
Amortized Cost Basis% of Class of Financing ReceivableAmortization Cost Basis% of Class of Financing Receivable
(dollars in thousands)
Real estate - residential mortgage$2,365 0.04 %$910 0.02 %
Total$2,365 $910 
The following table presents the financial effect of the modifications made to borrowers experiencing financial difficulty:

Term Extension
Financial Effect
2024
Real estate - commercial mortgage
Added a weighted-average 1.99 years to the life of loans, which reduced monthly payment amounts for the borrowers.
Commercial and industrial
Added a weighted-average 0.67 years to the life of loans, which reduced monthly payment amounts for the borrowers.
Real estate - residential mortgage
Added a weighted-average 8.98 years to the life of loans, which reduced monthly payment amounts for the borrowers.
Real estate - home equity
Added a weighted-average 14.30 years to the life of loans, which reduced monthly payment amounts for the borrowers.
Real estate - construction
Added a weighted-average 0.67 years to the life of loans, which reduced monthly payment amounts for the borrowers.
2023
Real estate - commercial mortgage
Added a weighted-average 1.22 years to the life of loans, which reduced monthly payment amounts for the borrowers.
Commercial and industrial
Added a weighted-average 0.92 years to the life of loans, which reduced monthly payment amounts for the borrowers.
Real estate - residential mortgage
Added a weighted-average 8.10 years to the life of loans, which reduced monthly payment amounts for the borrowers.

Interest Rate Reduction
Financial Effect
2024
Real estate - residential mortgage
Reduced weighted-average interest rate from 2.35% to 1.40%
2023
Real estate - residential mortgage
Reduced weighted-average interest rate from 3.76% to 2.30%

During the years ended December 31, 2024 and 2023, there were no loans modified due to financial difficulty where there was a principal balance forgiveness.

During the years ended December 31, 2024 and 2023, there were no loans modified due to financial difficulty that defaulted subsequent to modification.

The following table presents the performance of loans that have been modified due to financial difficulty in the previous 12 months.
30-8990+Total
Days PastPast DuePast
CurrentDueand AccruingDue
(dollars in thousands)
Real estate - commercial mortgage$16,321 $123 $— $123 
Commercial and industrial3,913 — — — 
Real estate - residential mortgage11,448 1,918 642 2,560 
Real estate - home equity379 — — — 
Real estate - construction595 — — — 
Total$32,656 $2,041 $642 $2,683 
There were no commitments to lend additional funds to borrowers with loan modifications as a result of financial difficulty as of December 31, 2024.