6. LOANS AND LEASE FINANCE RECEIVABLES AND ALLOWANCE FOR LOAN LOSSES

The following table provides a summary of the total of loan and lease finance receivables, excluding PCI loans, by type.


	March 31, 2015			December 31, 2014
	(Dollars in thousands)
Commercial and industrial	$	403,600		$	390,011
SBA		126,385			134,265
Real estate:
Commercial real estate		2,499,183			2,487,803
Construction		55,346			55,173
SFR mortgage		205,132			205,124
Dairy & livestock and agribusiness		173,441			279,173
Municipal lease finance receivables		76,220			77,834
Consumer and other loans		70,749			69,884

Gross loans, excluding PCI loans		3,610,056			3,699,267
Less: Deferred loan fees, net		(8,451	)		(8,567	)

Gross loans, excluding PCI loans, net of deferred loan fees		3,601,605			3,690,700
Less: Allowance for loan losses		(60,709	)		(59,825	)

Net loans, excluding PCI loans		3,540,896			3,630,875

PCI Loans		121,030			133,496
Discount on PCI loans		(6,612	)		(7,129	)

PCI loans, net		114,418			126,367

Total loans and lease finance receivables	$	3,655,314		$	3,757,242

As of March 31, 2015, 69.23% of the total gross loan portfolio (excluding PCI loans) consisted of commercial real estate loans and 1.53% of the total loan portfolio consisted of construction loans. Substantially all of the Company’s real estate loans and construction loans are secured by real properties located in California. As of March 31, 2015, $150.9 million, or 6.04%, of the total commercial real estate loans included loans secured by farmland, compared to $165.6 million, or 6.66%, at December 31, 2014. The loans secured by farmland included $131.5 million for loans secured by dairy & livestock land and $19.4 million for loans secured by agricultural land at March 31, 2015, compared to $144.1 million for loans secured by dairy & livestock land and $21.5 million for loans secured by agricultural land at December 31, 2014. As of March 31, 2015, $173.4 million, or 4.80%, of the total gross loan portfolio (excluding PCI loans) consisted of dairy & livestock and agribusiness commercial loans, compared to $279.2 million, or 7.55%, at December 31, 2014. This was comprised of $161.5 million for dairy & livestock loans and $12.0 million for agribusiness loans at March 31, 2015, compared to $268.1 million for dairy & livestock loans and $11.1 million for agribusiness loans at December 31, 2014. At March 31, 2015, the Company held approximately $1.81 billion of total fixed rate loans.

At March 31, 2015 and December 31, 2014, loans totaling $2.82 billion and $2.78 billion, respectively, were pledged to secure borrowings and available lines of credit from the FHLB and the Federal Reserve Bank.

Loans Held-for-Sale

The following table provides a summary of the activity related to loans held-for-sale for the periods presented.


	For the Three Months Ended March 31,
	2015		2014
	(Dollars in thousands)
Balance, beginning of period	$	—	$	3,667
Originations of mortgage loans		—		—
Sales of mortgage loans		—		—
Transfer of mortgage loans to held-for-investment		—		—
Sales of other loans		—		(3,667	)
Transfers of other loans to held-for-sale		—		—
Write-down of loans held-for-sale		—		—

Balance, end of period	$	—	$	—

Credit Quality Indicators

Central to our credit risk management is our loan risk rating system. The originating credit officer assigns borrowers an initial risk rating, which is reviewed and confirmed or changed, as appropriate, by Credit Management. Approvals are made based upon the amount of inherent credit risk specific to the transaction and are reviewed for appropriateness by senior line and credit management personnel. Credits are monitored by line and credit management personnel for deterioration in a borrower’s financial condition, which would impact the ability of the borrower to perform under the contract. Risk ratings are adjusted as necessary.

Loans are risk rated into the following categories (Credit Quality Indicators): Pass, Pass Watch List, Special Mention, Substandard, Doubtful and Loss. Each of these groups is assessed for the proper amount to be used in determining the adequacy of our allowance for losses. These categories can be described as follows:

Pass – These loans range from minimal credit risk to lower than average, but still acceptable, credit risk.

Pass Watch List — Pass Watch list loans usually require more than normal management attention. Loans which qualify for the Pass Watch List may involve borrowers with adverse financial trends, higher debt/equity ratios, or weaker liquidity positions, but not to the degree of being considered a defined weakness or problem loan where risk of loss may be apparent.

Special Mention — Loans assigned to this category are currently protected but are weak. Although concerns exist, the Company is currently protected and loss is unlikely. Such loans have potential weaknesses that may, if not checked or corrected, weaken the asset or inadequately protect the Company’s credit position at some future date.

Substandard – Loans classified as substandard include poor liquidity, high leverage, and erratic earnings or losses. The primary source of repayment is no longer realistic, and asset or collateral liquidation may be the only source of repayment. Substandard loans are marginal and require continuing and close supervision by credit management. Substandard loans have the distinct possibility that the Company will sustain some loss if deficiencies are not corrected.

Doubtful – Loans classified doubtful have all the weaknesses inherent in those classified substandard with the added provision that the weaknesses make collection or the liquidation, on the basis of currently existing facts, conditions and values, highly questionable and improbable. The possibility of loss is extremely high, but because of certain important and reasonable specific pending factors which may work to the advantage and strengthening of the assets, their classifications as losses are deferred until their more exact status may be determined.

Loss — Loans classified as loss are considered uncollectible and of such little value that their continuance as active assets of the Company is not warranted. This classification does not mean that the loan has absolutely no recovery or salvage value, but rather that it is not practical or desirable to defer writing off this basically worthless asset even though partial recovery may be achieved in the future.

The following tables summarize each class of loans, excluding PCI Loans, according to our internal risk ratings for the periods presented.


	March 31, 2015
	Pass		Watch List		Special Mention		Substandard		Doubtful & Loss		Total
	(Dollars in thousands)
Commercial and industrial	$	252,537	$	96,106	$	42,377	$	12,350	$	230	$	403,600
SBA		80,047		22,423		14,362		8,070		1,483		126,385
Real estate:
Commercial real estate
Owner occupied		551,211		139,446		49,994		17,159		—		757,810
Non-owner occupied		1,390,414		258,838		37,420		54,701		—		1,741,373
Construction
Speculative		27,394		3,101		—		7,651		—		38,146
Non-speculative		16,579		621		—		—		—		17,200
SFR mortgage		176,298		18,882		4,285		5,667		—		205,132
Dairy & livestock and agribusiness		103,616		67,149		2,277		296		103		173,441
Municipal lease finance receivables		38,562		32,403		5,255		—		—		76,220
Consumer and other loans		54,900		10,487		2,670		2,595		97		70,749

Total gross loans, excluding PCI loans	$	2,691,558	$	649,456	$	158,640	$	108,489	$	1,913	$	3,610,056


	December 31, 2014
	Pass		Watch List		Special Mention		Substandard		Doubtful & Loss		Total
	(Dollars in thousands)
Commercial and industrial	$	234,029	$	105,904	$	33,795	$	16,031	$	252	$	390,011
SBA		84,769		24,124		15,858		7,920		1,594		134,265
Real estate:
Commercial real estate
Owner occupied		552,072		159,908		46,248		32,139		—		790,367
Non-owner occupied		1,347,006		241,809		56,353		52,268		—		1,697,436
Construction
Speculative		28,310		613		—		7,651		—		36,574
Non-speculative		18,071		528		—		—		—		18,599
SFR mortgage		174,311		20,218		2,442		8,153		—		205,124
Dairy & livestock and agribusiness		174,783		85,660		8,612		10,015		103		279,173
Municipal lease finance receivables		35,463		22,349		20,022		—		—		77,834
Consumer and other loans		62,904		2,233		1,789		2,763		195		69,884

Total gross loans, excluding PCI loans	$	2,711,718	$	663,346	$	185,119	$	136,940	$	2,144	$	3,699,267

Allowance for Loan Losses

The Company’s Credit Management Division is responsible for regularly reviewing the allowance for loan losses (“ALLL”) methodology, including loss factors and economic risk factors. The Bank’s Director Loan Committee provides Board oversight of the ALLL process and approves the ALLL methodology on a quarterly basis.

Our methodology for assessing the appropriateness of the allowance is conducted on a regular basis and considers the Bank’s overall loan portfolio. Refer to Note 3 – Summary of Significant Accounting Policies of the 2014 Annual Report on Form 10-K for a more detailed discussion concerning the allowance for loan losses.

Management believes that the ALLL was appropriate at March 31, 2015 and December 31, 2014. No assurance can be given that economic conditions which adversely affect the Company’s service areas or other circumstances will not be reflected in increased provisions for loan losses in the future.

The following tables present the balance and activity related to the allowance for loan losses for held-for-investment loans, excluding PCI loans, by portfolio segment for the periods presented.


	For the Three Months Ended March 31, 2015
	Ending Balance December 31, 2014		Charge-offs			Recoveries		Provision for Loan Losses			Ending Balance March 31, 2015
	(Dollars in thousands)
Commercial and industrial	$	7,074	$	(134	)	$	35	$	527		$	7,502
SBA		2,557		(33	)		34		(362	)		2,196
Real estate:
Commercial real estate		33,373		—			857		618			34,848
Construction		988		—			9		46			1,043
SFR mortgage		2,344		—			185		(104	)		2,425
Dairy & livestock and agribusiness		5,479		—			99		(1,832	)		3,746
Municipal lease finance receivables		1,412		—			—		(382	)		1,030
Consumer and other loans		1,262		(177	)		9		(269	)		825
Unallocated		5,336		—			—		1,758			7,094

Total allowance for loan losses	$	59,825	$	(344	)	$	1,228	$	—		$	60,709


	For the Three Months Ended March 31, 2014
	Ending Balance December 31, 2013		Charge-offs			Recoveries		(Recapture of) Provision for Loan Losses			Ending Balance March 31, 2014
	(Dollars in thousands)
Commercial and industrial	$	8,502	$	(454	)	$	392	$	(2,072	)	$	6,368
SBA		2,332		—			63		73			2,468
Real estate:
Commercial real estate		39,402		—			68		(70	)		39,400
Construction		1,305		—			778		(1,625	)		458
SFR mortgage		2,718		—			—		(436	)		2,282
Dairy & livestock and agribusiness		11,728		—			144		(2,605	)		9,267
Municipal lease finance receivables		2,335		—			—		(816	)		1,519
Consumer and other loans		960		(13	)		12		(9	)		950
Unallocated		5,953		—			—		60			6,013

Total allowance for loan losses	$	75,235	$	(467	)	$	1,457	$	(7,500	)	$	68,725

The following tables present the recorded investment in loans held-for-investment, excluding PCI loans, and the related allowance for loan losses by portfolio segment, based on the Company’s methodology for determining the allowance for loan losses for the periods presented.


	March 31, 2015
	Recorded Investment in Loans				Allowance for Loan Losses
	Individually Evaluated for Impairment		Collectively Evaluated for Impairment		Individually Evaluated for Impairment		Collectively Evaluated for Impairment
	(Dollars in thousands)
Commercial and industrial	$	1,611	$	401,989	$	592	$	6,910
SBA		3,158		123,227		42		2,154
Real estate:
Commercial real estate		41,886		2,457,297		154		34,694
Construction		7,651		47,695		—		1,043
SFR mortgage		5,913		199,219		—		2,425
Dairy & livestock and agribusiness		7,277		166,164		—		3,746
Municipal lease finance receivables		—		76,220		—		1,030
Consumer and other loans		881		69,868		6		819
Unallocated		—		—		—		7,094

Total	$	68,377	$	3,541,679	$	794	$	59,915


	March 31, 2014
	Recorded Investment in Loans				Allowance for Loan Losses
	Individually Evaluated for Impairment		Collectively Evaluated for Impairment		Individually Evaluated for Impairment		Collectively Evaluated for Impairment
	(Dollars in thousands)
Commercial and industrial	$	4,291	$	354,714	$	814	$	5,554
SBA		1,649		129,999		68		2,400
Real estate:
Commercial real estate		33,907		2,160,144		320		39,080
Construction		26,688		16,218		—		458
SFR mortgage		11,692		178,207		47		2,235
Dairy & livestock and agribusiness		27,972		184,985		2,656		6,611
Municipal lease finance receivables		—		81,041		—		1,519
Consumer and other loans		397		54,418		96		854
Unallocated		—		—		—		6,013

Total	$	106,596	$	3,159,726	$	4,001	$	64,724

Past Due and Nonperforming Loans

We seek to manage asset quality and control credit risk through diversification of the loan portfolio and the application of policies designed to promote sound underwriting and loan monitoring practices. The Bank’s Credit Management Division is in charge of monitoring asset quality, establishing credit policies and procedures and enforcing the consistent application of these policies and procedures across the Bank. Reviews of nonperforming, past due loans and larger credits, designed to identify potential charges to the allowance for loan losses, and to determine the appropriateness of the allowance, are conducted on an ongoing basis. These reviews consider such factors as the financial strength of borrowers and any guarantors, the value of the applicable collateral, loan loss experience, estimated loan losses, growth in the loan portfolio, prevailing economic conditions and other factors. Refer to Note 3 – Summary of Significant Accounting Policies, included in our Annual Report on Form 10-K for the year ended December 31, 2014 for additional discussion concerning the Bank’s policy for past due and nonperforming loans.

Loans are reported as a troubled debt restructuring when the Bank grants a concession(s) to a borrower experiencing financial difficulties that the Bank would not otherwise consider. Examples of such concessions include a reduction in the interest rate, deferral of principal or accrued interest, extending the payment due dates or loan maturity date(s), or providing a lower interest rate than would be normally available for new debt of similar risk. As a result of these concessions, restructured loans are classified as impaired. Impairment reserves on non-collateral dependent restructured loans are measured by comparing the present value of expected future cash flows on the restructured loans discounted at the interest rate of the original loan agreement to the loan’s carrying value. These impairment reserves are recognized as a specific component to be provided for in the allowance for loan losses.

Generally, when loans are identified as impaired they are moved to our Special Assets Department. When we identify a loan as impaired, we measure the loan for potential impairment using discounted cash flows, unless the loan is determined to be collateral dependent. In these cases, we use the current fair value of collateral, less selling costs. Generally, the determination of fair value is established through obtaining external appraisals of the collateral.

Speculative construction loans are generally for properties where there is no identified buyer or renter.

The following tables present the recorded investment in the aging of past due and nonaccrual loans, excluding PCI loans, by type of loans for the periods presented.


	March 31, 2015
	30-59 Days Past Due		60-89 Days Past Due		Total Past Due and Accruing		Nonaccrual (1)		Current		Total Loans and Financing Receivables
	(Dollars in thousands)
Commercial and industrial	$	112	$	—	$	112	$	952	$	402,536		403,600
SBA		—		—		—		2,463		123,922		126,385
Real estate:
Commercial real estate
Owner occupied		35		—		35		2,418		755,357		757,810
Non-owner occupied		—		—		—		14,369		1,727,004		1,741,373
Construction
Speculative		—		—		—		—		38,146		38,146
Non-speculative		—		—		—		—		17,200		17,200
SFR mortgage		1,613		—		1,613		2,233		201,286		205,132
Dairy & livestock and agribusiness		—		—		—		103		173,338		173,441
Municipal lease finance receivables		—		—		—		—		76,220		76,220
Consumer and other loans		119		20		139		463		70,147		70,749

Total gross loans, excluding PCI Loans	$	1,879	$	20	$	1,899	$	23,001	$	3,585,156	$	3,610,056

(1)	As of March 31, 2015, $20.3 million of nonaccruing loans were current, $553,000 were 30-59 days past due, $86,000 were 60-89 days past due and $2.0 million were 90+ days past due.


	December 31, 2014
	30-59 Days Past Due		60-89 Days Past Due		Total Past Due and Accruing		Nonaccrual (1)		Current		Total Loans and Financing Receivables
	(Dollars in thousands)
Commercial and industrial	$	943	$	35	$	978	$	2,308	$	386,725	$	390,011
SBA		75		—		75		2,481		131,709		134,265
Real estate:
Commercial real estate
Owner occupied		36		86		122		4,072		786,173		790,367
Non-owner occupied		—		—		—		19,246		1,678,190		1,697,436
Construction
Speculative		—		—		—		—		36,574		36,574
Non-speculative		—		—		—		—		18,599		18,599
SFR mortgage		425		—		425		3,240		201,459		205,124
Dairy & livestock and agribusiness		—		—		—		103		279,070		279,173
Municipal lease finance receivables		—		—		—		—		77,834		77,834
Consumer and other loans		64		17		81		736		69,067		69,884

Total gross loans, excluding PCI Loans	$	1,543	$	138	$	1,681	$	32,186	$	3,665,400	$	3,699,267

(1)	As of December 31, 2014, $20.1 million of nonaccruing loans were current, $3.7 million were 30-59 days past due, $8.5 million were 90+ days.

Impaired Loans

At March 31, 2015, the Company had impaired loans, excluding PCI loans, of $68.4 million. Of this amount, there were $16.8 million of nonaccrual commercial real estate loans, $2.2 million of nonaccrual SFR mortgage loans, $952,000 of nonaccrual commercial and industrial loans, $103,000 of nonaccrual dairy & livestock and agribusiness loans and $463,000 of nonaccrual consumer and other loans. These impaired loans included $62.2 million of loans whose terms were modified in a troubled debt restructuring, of which $16.8 million were classified as nonaccrual. The remaining balance of $45.4 million consisted of 34 loans performing according to the restructured terms. The impaired loans had a specific allowance of $794,000 at March 31, 2015. At December 31, 2014, the Company had classified as impaired loans, excluding PCI loans, with a balance of $85.8 million with a related allowance of $1.5 million.

The following tables present information for held-for-investment loans, excluding PCI loans, individually evaluated for impairment by class of loans, as of and for the periods indicated below.


	As of and For the Three Months Ended March 31, 2015
	Recorded Investment		Unpaid Principal Balance		Related Allowance		Average Recorded Investment		Interest Income Recognized
	(Dollars in thousands)
With no related allowance recorded:
Commercial and industrial	$	1,004	$	1,819	$	—	$	1,017	$	8
SBA		3,117		3,667		—		3,177		13
Real estate:
Commercial real estate
Owner occupied		6,117		7,167		—		6,185		64
Non-owner occupied		34,808		42,718		—		35,194		350
Construction
Speculative		7,651		7,651		—		7,651		96
Non-speculative		—		—		—		—		—
SFR mortgage		5,913		6,642		—		5,940		27
Dairy & livestock and agribusiness		7,277		8,991		—		7,533		85
Municipal lease finance receivables		—		—		—		—		—
Consumer and other loans		783		1,289		—		836		4

Total		66,670		79,944		—		67,533		647

With a related allowance recorded:
Commercial and industrial		607		680		592		617		—
SBA		41		54		42		45		—
Real estate:
Commercial real estate
Owner occupied		—		—		—		—		—
Non-owner occupied		961		1,278		154		973		—
Construction
Speculative		—		—		—		—		—
Non-speculative		—		—		—		—		—
SFR mortgage		—		—		—		—		—
Dairy & livestock and agribusiness		—		—		—		—		—
Municipal lease finance receivables		—		—		—		—		—
Consumer and other loans		98		107		6		99		—

Total		1,707		2,119		794		1,734		—

Total impaired loans	$	68,377	$	82,063	$	794	$	69,267	$	647


	As of and For the Three Months Ended March 31, 2014
	Recorded Investment		Unpaid Principal Balance		Related Allowance		Average Recorded Investment		Interest Income Recognized
	(Dollars in thousands)
With no related allowance recorded:
Commercial and industrial	$	2,592	$	2,862	$	—	$	2,596	$	15
SBA		1,581		1,997		—		1,634		—
Real estate:
Commercial real estate
Owner occupied		10,108		10,768		—		10,221		117
Non-owner occupied		21,928		27,740		—		22,103		215
Construction
Speculative		17,519		18,407		—		17,550		77
Non-speculative		9,169		9,169		—		9,184		140
SFR mortgage		11,214		12,911		—		11,266		26
Dairy & livestock and agribusiness		16,582		17,430		—		16,902		189
Municipal lease finance receivables		—		—		—		—		—
Consumer and other loans		290		295		—		291		—

Total		90,983		101,579		—		91,747		779

With a related allowance recorded:
Commercial and industrial		1,699		2,033		814		1,701		—
SBA		68		76		68		70		—
Real estate:
Commercial real estate
Owner occupied		1,871		2,344		320		1,871		—
Non-owner occupied		—		—		—		—		—
Construction
Speculative		—		—		—		—		—
Non-speculative		—		—		—		—		—
SFR mortgage		478		486		47		479		—
Dairy & livestock and agribusiness		11,390		12,042		2,656		11,608		75
Municipal lease finance receivables		—		—		—		—		—
Consumer and other loans		107		165		96		107		—

Total		15,613		17,146		4,001		15,836		75

Total impaired loans	$	106,596	$	118,725	$	4,001	$	107,583	$	854


	As of December 31, 2014
	Recorded Investment		Unpaid Principal Balance		Related Allowance
	(Dollars in thousands)
With no related allowance recorded:
Commercial and industrial	$	2,391	$	3,624	$	—
SBA		1,853		2,197		—
Real estate:
Commercial real estate
Owner occupied		16,961		18,166		—
Non-owner occupied		30,068		38,156		—
Construction
Speculative		7,651		7,651		—
Non-speculative		—		—		—
SFR mortgage		6,512		7,493		—
Dairy & livestock and agribusiness		15,796		17,587		—
Municipal lease finance receivables		—		—		—
Consumer and other loans		673		1,094		—

Total		81,905		95,968		—

With a related allowance recorded:
Commercial and industrial		629		698		615
SBA		1,327		1,591		296
Real estate:
Commercial real estate
Owner occupied		—		—		—
Non-owner occupied		982		1,278		154
Construction
Speculative		—		—		—
Non-speculative		—		—		—
SFR mortgage		467		484		35
Dairy & livestock and agribusiness		—		—		—
Municipal lease finance receivables		—		—		—
Consumer and other loans		482		508		449

Total		3,887		4,559		1,549

Total impaired loans	$	85,792	$	100,527	$	1,549

The Company recognizes the charge-off of impairment allowance on impaired loans in the period in which a loss is identified for collateral dependent loans. Therefore, the majority of the nonaccrual loans as of March 31, 2015 and December 31, 2014 have already been written down to the estimated net realizable value. The impaired loans with a related allowance recorded are on nonaccrual loans where a charge-off is not yet processed, on nonaccrual SFR loans where there is a potential modification in process, or on smaller balance non-collateral dependent loans.

Reserve for Unfunded Loan Commitments

The allowance for off-balance sheet credit exposure relates to commitments to extend credit, letters of credit and undisbursed funds on lines of credit. The Company evaluates credit risk associated with the off-balance sheet commitments at the same time it evaluates credit risk associated with the loan and lease portfolio. The Company recorded a reduction of the reserve for unfunded loan commitments of $500,000 for the quarter ended March 31, 2015, compared with no provision or reduction of the reserve for unfunded loan commitments for the same period of 2014. At March 31, 2015 and December 31, 2014, the balance of the reserve was $7.2 million and $7.7 million, respectively, and was included in other liabilities.

Troubled Debt Restructurings (“TDRs”)

Loans that are reported as TDRs are considered impaired and charge-off amounts are taken on an individual loan basis, as deemed appropriate. The majority of restructured loans are loans for which the terms of repayment have been renegotiated, resulting in a reduction in interest rate or deferral of principal. Refer to Note 3 – Summary of Significant Accounting Policies, included in our Annual Report on Form 10-K for the year ended December 31, 2014 for a more detailed discussion regarding TDRs.

As of March 31, 2015, there were $62.2 million of loans classified as TDRs, of which $16.8 million were nonperforming and $45.4 million were performing. TDRs on accrual status are comprised of loans that were accruing interest at the time of restructuring or have demonstrated repayment performance in compliance with the restructured terms for a sustained period and for which the Company anticipates full repayment of both principal and interest. At March 31, 2015, performing TDRs were comprised of 12 commercial real estate loans of $25.1 million, one construction loan of $7.6 million, five dairy & livestock loans of $7.2 million, 11 SFR mortgage loans of $3.7 million, four commercial and industrial loans of $1.4 million and one consumer other loan of $418,000. There were no loans removed from TDR classification during the quarters ended March 31, 2015 and 2014.

The majority of TDRs have no specific allowance allocated as any impairment amount is normally charged off at the time a probable loss is determined. We have allocated $707,000 and $726,000 of specific allowance to TDRs as of March 31, 2015 and December 31, 2014, respectively.

The following tables provide a summary of the activity related to TDRs for the periods presented.


	For the Three Months March 31,
	2015			2014
	(Dollars in thousands)
Performing TDRs:
Beginning balance	$	53,589		$	66,955
New modifications		—			41
Payoffs and payments, net		(8,729	)		(602	)
TDRs returned to accrual status		516			—
TDRs placed on nonaccrual status		—			—

Ending balance	$	45,376		$	66,394


	For the Three Months March 31,
	2015			2014
	(Dollars in thousands)
Nonperforming TDRs:
Beginning balance	$	20,285		$	25,119
New modifications (1)		—			—
Charge-offs		—			—
Payoffs and payments, net		(2,995	)		(1,151	)
TDRs returned to accrual status		(516	)		—
TDRs placed on nonaccrual status		—			—

Ending balance	$	16,774		$	23,968

The following tables summarize loans modified as troubled debt restructurings for the periods presented.

Modifications (1)


	For the Three Months Ended March 31, 2015
	Number of Loans		Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment		Outstanding Recorded Investment at March 31, 2015		Financial Effect Resulting From Modifications (2)
	(Dollars in thousands)
Commercial and industrial:
Interest rate reduction		—	$	—	$	—	$	—	$	—
Change in amortization period or maturity		—		—		—		—		—
Real estate:
Commercial real estate:
Owner occupied
Interest rate reduction		—		—		—		—		—
Change in amortization period or maturity		—		—		—		—
Non-owner occupied
Interest rate reduction		—		—		—		—		—
Change in amortization period or maturity		—		—		—		—		—
Dairy & livestock and agribusiness:
Interest rate reduction		—		—		—		—		—
Change in amortization period or maturity		—		—		—		—		—
Consumer
Interest rate reduction		—		—		—		—		—

Total loans		—	$	—	$	—	$	—	$	—


	For the Three Months Ended March 31, 2014
	Number of Loans		Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment		Outstanding Recorded Investment at March 31, 2014		Financial Effect Resulting From Modifications (2)
	(Dollars in thousands)
Commercial and industrial:
Interest rate reduction		—	$	—	$	—	$	—	$	—
Change in amortization period or maturity		1		41		41		39		—
Real estate:
Commercial real estate:
Owner occupied
Interest rate reduction		—		—		—		—		—
Change in amortization period or maturity		—		—		—		—		—
Non-owner occupied				—
Interest rate reduction		—		—		—		—
Change in amortization period or maturity		—		—		—		—		—
Dairy & livestock and agribusiness:
Interest rate reduction		—		—		—		—		—
Change in amortization period or maturity				—
Consumer
Interest rate reduction		—		—		—		—		—

Total loans		1	$	41	$	41	$	39	$	—

(1)	The tables exclude modified loans that were paid off prior to the end of the period.

(2)	Financial effects resulting from modifications represent charge-offs and specific allowance recorded at modification date.

As of March 31, 2015, there were no loans that were previously modified as a TDRs within the previous 12 months that subsequently defaulted during the three months ended March 31, 2015.