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Loans and Loans Held for Sale | 3 Months Ended
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Mar. 31, 2022
Receivables [Abstract] |
LOANS AND LOANS HELD FOR SALE | LOANS AND LOANS HELD FOR SALE Loans are presented net of unearned income of $10.1 million at March 31, 2022 and $14.1 million at December 31, 2021 and net of a discount related to purchase accounting fair value adjustments of $5.7 million at March 31, 2022 and $6.7 million at December 31, 2021. The following table presents loans as of the dates presented:
(dollars in thousands) | March 31, 2022 |  | December 31, 2021
Commercial |  |  |
Commercial real estate | $ | 3,257,955 |  |  | $ | 3,236,653 |
Commercial and industrial | 1,675,316 |  |  | 1,728,969 |
Commercial construction | 398,592 |  |  | 440,962 |
Total Commercial Loans | 5,331,863 |  |  | 5,406,584 |
Consumer |  |  |
Consumer real estate | 1,519,751 |  |  | 1,485,478 |
Other consumer | 112,297 |  |  | 107,928 |
Total Consumer Loans | 1,632,048 |  |  | 1,593,406 |
Total Portfolio Loans | 6,963,911 |  |  | 6,999,990 |
Loans held for sale | 1,346 |  |  | 1,522 |
Total Loans (1) | $ | 6,965,257 |  |  | $ | 7,001,512 |
(1) Excludes interest receivable of $18.7 million at both March 31, 2022 and December 31, 2021. Interest receivable is included in other assets in the Consolidated Balance Sheets. Commercial and industrial loans, or C&I, included $41.9 million of loans originated under the Paycheck Protection Program, or PPP, at March 31, 2022 compared to $88.3 million at December 31, 2021. On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security, or CARES Act was signed into law. The CARES Act included the PPP, a program designed to aid small and medium sized businesses through federally guaranteed loans distributed through banks. PPP loans are forgivable, in whole or in part, if the proceeds are used for payroll and other permitted expenses in accordance with the requirements of the PPP. The loans are 100 percent guaranteed by the Small Business Administration, or SBA. Our business banking segment was $1.1 billion at March 31, 2022 and December 31, 2021. Business banking consists of commercial loans made to small businesses that are standard, non-complex products evaluated through a streamlined credit approval process that has been designed to maximize efficiency while maintaining high credit quality standards that meet small business market customers’ needs. Business banking consisted of $552.2 million of commercial real estate loans, $216.7 million of C&I loans of which $20.6 million are PPP loans, $15.4 million of commercial construction loans and $357.0 million of consumer real estate loans at March 31, 2022. At December 31, 2021 business banking consisted of $546.1 million of commercial real estate loans, $215.4 million of C&I loans of which $39.7 million are PPP loans, $16.2 million of commercial construction loans and $357.9 million of consumer real estate loans. We attempt to limit our exposure to credit risk by diversifying our loan portfolio by segment, geography, collateral and industry and actively managing concentrations. When concentrations exist in certain segments, we mitigate this risk by reviewing the relevant economic indicators and internal risk rating trends and through stress testing of the loans in these segments to determine if additional ACL is needed. Total commercial loans represented 76.6 percent of total portfolio loans at March 31, 2022 compared to 77.2 percent at December 31, 2021. Within our commercial portfolio, the CRE and commercial construction portfolios combined comprised $3.7 billion, or 68.6 percent, of total commercial loans and 52.5 percent of total portfolio loans at March 31, 2022 and $3.7 billion, or 68.0 percent, of total commercial loans and 52.5 percent of total portfolio loans at December 31, 2021. We lend primarily in Pennsylvania and the contiguous states of Ohio, New York, West Virginia and Maryland. The majority of our commercial and consumer loans are made to businesses and individuals in this geography, resulting in a concentration. We believe our knowledge and familiarity with customers and conditions locally outweighs this geographic concentration risk. The conditions of the local and regional economies are monitored closely through publicly available data and information supplied by our customers. We also use subscription services for additional geographic and industry specific information. Our CRE and commercial construction portfolios have exposure outside of this geography of 6.1 percent of the combined portfolios and 3.2 percent of total portfolio loans at March 31, 2022. This compares to 5.7 percent of the combined portfolios and 3.0 percent of total portfolio loans at December 31, 2021. We individually evaluate all substandard and nonaccrual commercial loans that have experienced a forbearance or change in terms agreement, and all substandard consumer and residential mortgage loans that entered into an agreement to modify their existing loan, to determine if they should be designated as troubled debt restructurings, or TDRs. TDRs can be returned to accruing status if the ultimate collectability of all contractual amounts due, according to the restructured agreement, is not in doubt and there is a period of a minimum of six months of satisfactory payment performance by the borrower either immediately before or after the restructuring. The following tables summarize TDRs as of the dates presented:
| March 31, 2022 |  | December 31, 2021
(dollars in thousands) | Performing TDRs |  | Nonperforming TDRs |  | Total TDRs |  | Performing TDRs |  | Nonperforming TDRs |  | Total TDRs
Commercial real estate | $ | — |  |  | $ | 969 |  |  | $ | 969 |  |  | $ | — |  |  | $ | 1,697 |  |  | $ | 1,697 |
Commercial and industrial | 721 |  |  | 10,225 |  |  | 10,946 |  |  | 748 |  |  | 14,889 |  |  | 15,637 |
Commercial construction | 2,167 |  |  | 480 |  |  | 2,647 |  |  | 2,190 |  |  | 2,087 |  |  | 4,277 |
Business banking | 987 |  |  | 1,586 |  |  | 2,573 |  |  | 858 |  |  | 1,696 |  |  | 2,554 |
Consumer real estate | 6,861 |  |  | 2,129 |  |  | 8,990 |  |  | 6,122 |  |  | 1,405 |  |  | 7,527 |
Other consumer | 3 |  |  | — |  |  | 3 |  |  | 3 |  |  | — |  |  | 3 |
Total | $ | 10,739 |  |  | $ | 15,389 |  |  | $ | 26,128 |  |  | $ | 9,921 |  |  | $ | 21,774 |  |  | $ | 31,695 |
There were no TDR's that returned to accruing status during the three months ended March 31, 2022 and March 31, 2021. The following tables present the TDRs by portfolio segment and by type of concession for the periods presented:
| Three Months Ended March 31, 2022
| Number of Contracts | Type of Modification | Total Post-Modification Outstanding Recorded Investment(2) | Total Pre-Modification Outstanding Recorded Investment(2)
(dollars in thousands) | Bankruptcy(1) | Other | Extend Maturity | Modify Rate | Modify Payments
Commercial real estate | — |  | $ | — |  | $ | — |  | $ | — |  | $ | — |  | $ | — |  | $ | — |  | $ | — |
Commercial industrial | — |  | — |  | — |  | — |  | — |  | — |  | — |  | — |
Commercial construction | — |  | — |  | — |  | — |  | — |  | — |  | — |  | — |
Business banking | — |  | — |  | — |  | — |  | — |  | — |  | — |  | — |
Consumer real estate | 7 |  | 766 |  | — |  | 1,112 |  | — |  | — |  | 1,878 |  | 1,928 |
Other consumer | — |  | — |  | — |  | — |  | — |  | — |  | — |  | — |
Total | 7 |  | $ | 766 |  | $ | — |  | $ | 1,112 |  | $ | — |  | $ | — |  | $ | 1,878 |  | $ | 1,928 |
(1) Bankruptcy is consumer bankruptcy loans where the debt has been legally discharged through the bankruptcy court and not reaffirmed. (2) Excludes loans that were fully paid off or fully charged-off by period end. The pre-modification balance represents the balance outstanding prior to modification. The post-modification balance represents the outstanding balance at period end.
| Three Months Ended March 31, 2021
| Number of Contracts | Type of Modification | Total Post-Modification Outstanding Recorded Investment(2) | Total Pre-Modification Outstanding Recorded Investment(2)
(dollars in thousands) | Bankruptcy(1) | Other | Extend Maturity | Modify Rate | Modify Payments
Commercial real estate | — |  | $ | — |  | $ | — |  | $ | — |  | $ | — |  | $ | — |  | $ | — |  | $ | — |
Commercial industrial | 2 |  | — |  | — |  | 821 |  | — |  | 5,475 |  | 6,296 |  | 6,304 |
Commercial construction | — |  | — |  | — |  | — |  | — |  | — |  | — |  | — |
Business banking | — |  | — |  | — |  | — |  | — |  | — |  | — |  | — |
Consumer real estate | 11 |  | 340 |  | 80 |  | — |  | — |  | 148 |  | 568 |  | 609 |
Other consumer | 1 |  | 1 |  | — |  | — |  | — |  | — |  | 1 |  | 1 |
Total | 14 |  | $ | 341 |  | $ | 80 |  | $ | 821 |  | $ | — |  | $ | 5,623 |  | $ | 6,865 |  | $ | 6,914 |
(1) Bankruptcy is consumer bankruptcy loans where the debt has been legally discharged through the bankruptcy court and not reaffirmed. (2) Excludes loans that were fully paid off or fully charged-off by period end. The pre-modification balance represents the balance outstanding prior to modification. The post-modification balance represents the outstanding balance at period end.
As of March 31, 2022, we had 12 commitments to lend an additional $0.8 million on TDRs compared to 20 commitments to lend an additional $0.8 million as of March 31, 2021. Defaulted TDRs are defined as loans having a payment default of 90 days or more after the restructuring takes place. There were no TDRs that defaulted during the three months ended March 31, 2022 and March 31, 2021. The following table is a summary of nonperforming assets as of the dates presented:
| Nonperforming Assets
(dollars in thousands) | March 31, 2022 |  | December 31, 2021
Nonperforming Assets |  |  |  |  |
Nonaccrual loans |  | $ | 37,135 |  |  |  | $ | 44,517 |
Nonaccrual TDRs |  | 15,389 |  |  |  | 21,774 |
Total Nonaccrual Loans |  | 52,524 |  |  |  | 66,291 |
OREO |  | 7,028 |  |  |  | 13,313 |
Total Nonperforming Assets |  | $ | 59,552 |  |  |  | $ | 79,604 |

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- Definition The entire disclosure for claims held for amounts due a entity, excluding financing receivables. Examples include, but are not limited to, trade accounts receivables, notes receivables, loans receivables. Includes disclosure for allowance for credit losses. + References Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef -Publisher FASB -Name Accounting Standards Codification -Topic 310 -SubTopic 10 -URI http://asc.fasb.org/subtopic&trid=2196772 + Details
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