XML 15 R8.htm IDEA: XBRL DOCUMENT v2.4.0.6
Allowance for Loan Losses
 3 Months Ended
Mar. 31, 2012
Allowance for Loan Losses  
Allowance for Loan Losses

2. Allowance for Loan Losses

 

The following tables presents the activity of the allowance for loan losses by portfolio segment at March 31.

 

Allowance for Loan Losses:

 

March 31, 2012

 

(Dollar amounts in thousands)

 

Commercial

 

Residential

 

Consumer

 

Unallocated

 

Total

 

Beginning balance

 

$

12,119

 

$

2,728

 

$

3,889

 

$

505

 

$

19,241

 

Provision for loan losses*

 

997

 

683

 

319

 

461

 

2,460

 

Loans charged -off

 

(1,858

)

(1,336

)

(783

)

—

 

(3,977

)

Recoveries

 

190

 

17

 

381

 

—

 

588

 

Ending Balance

 

$

11,448

 

$

2,092

 

$

3,806

 

$

966

 

$

18,312

 

 

 

* Provision before increase of $496 thousand in 2012 for decrease in FDIC indemnification asset

 

Allowance for Loan Losses:

 

March 31, 2011

 

(Dollar amounts in thousands)

 

Commercial

 

Residential

 

Consumer

 

Unallocated

 

Total

 

Beginning balance

 

$

12,809

 

$

2,873

 

$

4,551

 

$

2,103

 

$

22,336

 

Provision for loan losses*

 

689

 

687

 

(210

)

198

 

1,364

 

Loans charged -off

 

(1,061

)

(363

)

(768

)

—

 

(2,192

)

Recoveries

 

99

 

54

 

481

 

—

 

634

 

Ending Balance

 

$

12,536

 

$

3,251

 

$

4,054

 

$

2,301

 

$

22,142

 

 

* Provision before decrease of $182 thousand in 2011 for increase in FDIC indemnification asset

 

The following table presents the allocation of the allowance for loan losses and the recorded investment in loans by portfolio segment and based on the impairment method at March 31, 2012 and December 31, 2011.

 

Ending Balance Attributable to Loans:

 

March 31, 2012

 

(Dollar amounts in thousands)

 

Commercial

 

Residential

 

Consumer

 

Unallocated

 

Total

 

Individually evaluated for impairment

 

2,706

 

190

 

—

 

—

 

2,896

 

Collectively evaluated for impairment

 

8,348

 

1,894

 

3,806

 

966

 

15,014

 

Acquired with deteriorated credit quality

 

394

 

8

 

—

 

—

 

402

 

Ending Balance

 

$

11,448

 

$

2,092

 

$

3,806

 

$

966

 

$

18,312

 

 

Loans:

 

March 31, 2012

 

(Dollar amounts in thousands)

 

Commercial

 

Residential

 

Consumer

 

 

 

Total

 

Individually evaluated for impairment

 

21,681

 

1,213

 

—

 

 

 

22,894

 

Collectively evaluated for impairment

 

1,010,660

 

489,681

 

284,366

 

 

 

1,784,707

 

Acquired with deteriorated credit quality

 

39,253

 

11,638

 

10

 

 

 

50,901

 

Ending Balance

 

$

1,071,594

 

$

502,532

 

$

284,376

 

 

 

$

1,858,502

 

 

Allowance for Loan Losses: 

 

December 31, 2011

 

(Dollar amounts in thousands)

 

Commercial

 

Residential

 

Consumer

 

Unallocated

 

Total

 

Individually evaluated for impairment

 

3,071

 

190

 

—

 

—

 

3,261

 

Collectively evaluated for impairment

 

8,264

 

2,183

 

3,889

 

505

 

14,841

 

Acquired with deteriorated credit quality

 

784

 

355

 

—

 

—

 

1,139

 

Ending Balance

 

$

12,119

 

$

2,728

 

$

3,889

 

$

505

 

$

19,241

 

 

Loans

 

December 31, 2011

 

(Dollar amounts in thousands)

 

Commercial

 

Residential

 

Consumer

 

 

 

Total

 

Individually evaluated for impairment

 

25,393

 

2,213

 

—

 

 

 

27,606

 

Collectively evaluated for impairment

 

1,036,963

 

492,139

 

291,190

 

 

 

1,820,292

 

Acquired with deteriorated credit quality

 

43,389

 

12,986

 

11

 

 

 

56,386

 

Ending Balance

 

$

1,105,745

 

$

507,338

 

$

291,201

 

 

 

$

1,904,284

 

 

The following tables present loans individually evaluated for impairment by class of loans.

 

 

 

March 31, 2012

 

 

 

 

 

 

 

Allowance

 

 

 

 

 

 

 

 

 

Unpaid

 

 

 

for Loan

 

Average

 

Interest

 

Cash Basis

 

 

 

Principal

 

Recorded

 

Losses

 

Recorded

 

Income

 

Interest

 

(Dollar amounts in thousands)

 

Balance

 

Investment

 

Allocated

 

Investment

 

Recognized

 

Recognized

 

With no related allowance recorded:

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial & Industrial

 

$

—

 

$

—

 

$

—

 

$

—

 

$

—

 

$

—

 

Farmland

 

—

 

—

 

—

 

—

 

—

 

—

 

Non Farm, Non Residential

 

1,975

 

1,975

 

—

 

3,210

 

—

 

—

 

Agriculture

 

—

 

—

 

—

 

—

 

—

 

—

 

All Other Commercial

 

—

 

—

 

—

 

—

 

—

 

—

 

Residential

 

 

 

 

 

 

 

 

 

 

 

 

 

First Liens

 

—

 

—

 

—

 

375

 

—

 

—

 

Home Equity

 

—

 

—

 

—

 

—

 

—

 

—

 

Junior Liens

 

—

 

—

 

—

 

—

 

—

 

—

 

Multifamily

 

—

 

—

 

—

 

125

 

—

 

—

 

All Other Residential

 

—

 

—

 

—

 

—

 

—

 

—

 

Consumer

 

 

 

 

 

 

 

 

 

 

 

 

 

Motor Vehicle

 

—

 

—

 

—

 

—

 

—

 

—

 

All Other Consumer

 

—

 

—

 

—

 

—

 

—

 

—

 

With an allowance recorded:

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial

 

17,920

 

17,874

 

2,687

 

17,870

 

—

 

—

 

Commercial & Industrial

 

891

 

891

 

49

 

891

 

—

 

—

 

Farmland

 

2,709

 

2,709

 

182

 

3,763

 

—

 

—

 

Non Farm, Non Residential

 

—

 

—

 

—

 

—

 

—

 

—

 

Agriculture

 

1,457

 

1,456

 

74

 

1,487

 

—

 

—

 

All Other Commercial

 

 

 

 

 

 

 

 

 

 

 

 

 

Residential

 

1,213

 

1,213

 

190

 

1,213

 

—

 

—

 

First Liens

 

—

 

—

 

—

 

—

 

—

 

—

 

Home Equity

 

—

 

—

 

—

 

440

 

—

 

—

 

Junior Liens

 

—

 

—

 

—

 

—

 

—

 

—

 

Multifamily

 

—

 

—

 

—

 

—

 

—

 

—

 

All Other Residential

 

 

 

 

 

 

 

 

 

 

 

 

 

Consumer

 

—

 

—

 

—

 

—

 

—

 

—

 

Motor Vehicle

 

—

 

—

 

—

 

—

 

—

 

—

 

All Other Consumer

 

 

 

 

 

 

 

 

 

 

 

 

 

TOTAL

 

$

26,165

 

$

26,118

 

$

3,182

 

$

29,374

 

$

—

 

$

—

 

 

 

 

December 31, 2011

 

 

 

 

 

 

 

Allowance

 

 

 

 

 

Cash Basis

 

 

 

Unpaid

 

 

 

for Loan

 

Average

 

Interest

 

Interest

 

 

 

Principal

 

Recorded

 

Losses

 

Recorded

 

Income

 

Income

 

(Dollar amounts in thousands)

 

Balance

 

Investment

 

Allocated

 

Investment

 

Recognized

 

Recognized

 

With no related allowance recorded:

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial & Industrial

 

$

—

 

$

—

 

$

—

 

$

1,929

 

$

165

 

$

—

 

Farmland

 

—

 

—

 

—

 

—

 

—

 

—

 

Non Farm, Non Residential

 

4,444

 

4,444

 

—

 

3,262

 

—

 

—

 

Agriculture

 

—

 

—

 

—

 

—

 

—

 

—

 

All Other Commercial

 

—

 

—

 

—

 

—

 

—

 

—

 

Residential

 

 

 

 

 

 

 

 

 

 

 

 

 

First Liens

 

750

 

750

 

—

 

150

 

—

 

—

 

Home Equity

 

—

 

—

 

—

 

—

 

—

 

—

 

Junior Liens

 

—

 

—

 

—

 

—

 

—

 

—

 

Multifamily

 

250

 

250

 

—

 

50

 

—

 

—

 

All Other Residential

 

—

 

—

 

—

 

—

 

—

 

—

 

Consumer

 

 

 

 

 

 

 

 

 

 

 

 

 

Motor Vehicle

 

—

 

—

 

—

 

—

 

—

 

—

 

All Other Consumer

 

—

 

—

 

—

 

—

 

—

 

—

 

With an allowance recorded:

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial & Industrial

 

17,890

 

17,866

 

2,664

 

16,746

 

—

 

—

 

Farmland

 

891

 

891

 

49

 

360

 

—

 

—

 

Non Farm, Non Residential

 

4,816

 

4,816

 

957

 

8,717

 

—

 

—

 

Agriculture

 

—

 

—

 

—

 

—

 

—

 

—

 

All Other Commercial

 

1,517

 

1,517

 

66

 

1,671

 

—

 

—

 

Residential

 

 

 

 

 

 

 

 

 

 

 

 

 

First Liens

 

1,213

 

1,213

 

190

 

2,014

 

—

 

—

 

Home Equity

 

—

 

—

 

—

 

—

 

—

 

—

 

Junior Liens

 

879

 

879

 

347

 

937

 

—

 

—

 

Multifamily

 

—

 

—

 

—

 

510

 

—

 

—

 

All Other Residential

 

—

 

—

 

—

 

—

 

—

 

—

 

Consumer

 

 

 

 

 

 

 

 

 

 

 

 

 

Motor Vehicle

 

—

 

—

 

—

 

—

 

—

 

—

 

All Other Consumer

 

—

 

—

 

—

 

—

 

—

 

—

 

TOTAL

 

$

32,650

 

$

32,626

 

$

4,273

 

$

36,346

 

$

165

 

$

—

 

 

The table below presents non-performing loans.

 

 

 

March 31, 2012

 

 

 

Loans Past

 

 

 

 

 

 

 

Due Over

 

 

 

 

 

 

 

90 Day Still

 

 

 

 

 

(Dollar amounts in thousands)

 

Accruing

 

Restructured

 

Nonaccrual

 

Commercial

 

 

 

 

 

 

 

Commercial & Industrial

 

$

639

 

$

12,512

 

$

10,854

 

Farmland

 

786

 

—

 

910

 

Non Farm, Non Residential

 

340

 

—

 

8,541

 

Agriculture

 

—

 

—

 

139

 

All Other Commercial

 

109

 

—

 

3,377

 

Residential

 

 

 

 

 

 

 

First Liens

 

1,005

 

3,798

 

7,780

 

Home Equity

 

75

 

—

 

—

 

Junior Liens

 

337

 

4

 

483

 

Multifamily

 

—

 

—

 

3,244

 

All Other Residential

 

—

 

—

 

479

 

Consumer

 

 

 

 

 

 

 

Motor Vehicle

 

113

 

—

 

265

 

All Other Consumer

 

—

 

—

 

1,615

 

TOTAL

 

$

3,404

 

$

16,314

 

$

37,687

 

 

 

 

December 31, 2011

 

 

 

Loans Past

 

 

 

 

 

 

 

Due Over

 

 

 

 

 

 

 

90 Day Still

 

 

 

 

 

(Dollar amounts in thousands)

 

Accruing

 

Restructured

 

Nonaccrual

 

Commercial

 

 

 

 

 

 

 

Commercial & Industrial

 

$

317

 

$

12,590

 

$

9,673

 

Farmland

 

74

 

—

 

979

 

Non Farm, Non Residential

 

237

 

—

 

12,542

 

Agriculture

 

—

 

—

 

225

 

All Other Commercial

 

—

 

—

 

3,171

 

Residential

 

 

 

 

 

 

 

First Liens

 

1,150

 

3,856

 

7,398

 

Home Equity

 

8

 

—

 

—

 

Junior Liens

 

154

 

898

 

1,240

 

Multifamily

 

—

 

—

 

668

 

All Other Residential

 

136

 

—

 

171

 

Consumer

 

 

 

 

 

 

 

Motor Vehicle

 

77

 

—

 

294

 

All Other Consumer

 

4

 

—

 

1,741

 

TOTAL

 

$

2,157

 

$

17,344

 

$

38,102

 

 

Covered loans included in loans past due over 90 days still on accrual are $559 thousand at March 31, 2012 and $413 thousand at December 31, 2011. Covered loans included in non-accrual loans are $4.6 million at March 31, 2012 and $5.6 million at December 31, 2011. Covered loans of $3.2 million at March 31, 2012 and $5.0 million at December 31, 2011 are deemed impaired and have allowance for loan loss allocated to them of $0.3 million and $1.0 million, respectively for March 31, 2012 and December 31, 2011. Non-performing loans include both smaller balance homogeneous loans that are collectively evaluated for impairment and individually classified impaired loans.

 

The following table presents the aging of the recorded investment in loans by past due category and class of loans.

 

 

 

March 31, 2012

 

 

 

 

 

 

 

Greater

 

 

 

 

 

 

 

 

 

30-59 Days

 

60-89 Days

 

than 90 days

 

Total

 

 

 

 

 

(Dollar amounts in thousands)

 

Past Due

 

Past Due

 

Past Due

 

Past Due

 

Current

 

Total

 

Commercial

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial & Industrial

 

$

2,282

 

$

1,179

 

$

4,703

 

$

8,164

 

$

463,222

 

$

471,386

 

Farmland

 

152

 

229

 

1,677

 

2,058

 

91,963

 

94,021

 

Non Farm, Non Residential

 

2,607

 

3,480

 

3,157

 

9,244

 

306,605

 

315,849

 

Agriculture

 

297

 

14

 

16

 

327

 

94,269

 

94,596

 

All Other Commercial

 

3,303

 

18

 

1,630

 

4,951

 

90,791

 

95,742

 

Residential

 

 

 

 

 

 

 

 

 

 

 

 

 

First Liens

 

5,723

 

1,240

 

4,574

 

11,537

 

343,052

 

354,589

 

Home Equity

 

166

 

—

 

75

 

241

 

42,954

 

43,195

 

Junior Liens

 

486

 

258

 

373

 

1,117

 

39,305

 

40,422

 

Multifamily

 

—

 

—

 

62

 

62

 

51,587

 

51,649

 

All Other Residential

 

—

 

—

 

—

 

—

 

12,677

 

12,677

 

Consumer

 

 

 

 

 

 

 

 

 

 

 

 

 

Motor Vehicle

 

1,542

 

129

 

113

 

1,784

 

256,629

 

258,413

 

All Other Consumer

 

118

 

2

 

14

 

134

 

25,829

 

25,963

 

TOTAL

 

$

16,676

 

$

6,549

 

$

16,394

 

$

39,619

 

$

1,818,883

 

$

1,858,502

 

 

 

 

December 31, 2011

 

 

 

 

 

 

 

Greater

 

 

 

 

 

 

 

 

 

30-59 Days

 

60-89 Days

 

than 90 days

 

Total

 

 

 

 

 

(Dollar amounts in thousands)

 

Past Due

 

Past Due

 

Past Due

 

Past Due

 

Current

 

Total

 

Commercial

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial & Industrial

 

$

2,717

 

$

740

 

$

4,452

 

$

7,909

 

$

472,370

 

$

480,279

 

Farmland

 

5

 

57

 

1,034

 

1,096

 

98,158

 

99,254

 

Non Farm, Non Residential

 

2,945

 

420

 

7,754

 

11,120

 

310,724

 

321,844

 

Agriculture

 

88

 

—

 

97

 

185

 

114,162

 

114,347

 

All Other Commercial

 

120

 

—

 

1,588

 

1,708

 

88,313

 

90,021

 

Residential

 

 

 

 

 

 

 

 

 

 

 

 

 

First Liens

 

11,435

 

2,016

 

5,316

 

18,767

 

340,269

 

359,036

 

Home Equity

 

175

 

62

 

8

 

245

 

44,939

 

45,184

 

Junior Liens

 

1,333

 

183

 

190

 

1,706

 

39,903

 

41,609

 

Multifamily

 

—

 

100

 

668

 

768

 

46,216

 

46,984

 

All Other Residential

 

128

 

—

 

136

 

264

 

14,261

 

14,525

 

Consumer

 

 

 

 

 

 

 

 

 

 

 

 

 

Motor Vehicle

 

3,450

 

563

 

77

 

4,090

 

260,102

 

264,192

 

All Other Consumer

 

174

 

48

 

5

 

227

 

26,782

 

27,009

 

TOTAL

 

$

22,570

 

$

4,189

 

$

21,325

 

$

48,085

 

$

1,856,199

 

$

1,904,284

 

 

The Corporation has allocated $1.1 million and $1.6 million of specific reserves to customers whose loan terms have been modified in troubled debt restructurings as of March 31, 2012 and December 31, 2011.  The Corporation has not committed to lend additional amounts as of March 31, 2012 and December 31, 2011 to customers with outstanding loans that are classified as troubled debt restructurings. There were $162 thousand of modifications in the quarter ended March 31, 2012 that were troubled debt restructurings and the resulting impact to the allowance for loan losses was not material.

 

Credit Quality Indicators:

 

The Corporation categorizes loans into risk categories based on relevant information about the ability of borrowers to service their debt such as: current financial information, historical payment experience, credit documentation, public information, and current economic trends, among other factors.  The Corporation analyzes loans individually by classifying the loans as to credit risk.  This analysis includes non-homogeneous loans, such as commercial loans, with an outstanding balance greater than $50 thousand.  Any consumer loans outstanding to a borrower who had commercial loans analyzed will be similarly risk rated.  This analysis is performed on a quarterly basis.  The Corporation uses the following definitions for risk ratings:

 

Special Mention:  Loans classified as special mention have a potential weakness that deserves management’s close attention.  If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or of the institution’s credit position at some future date.

 

Substandard:  Loans classified as substandard are inadequately protected by the current net worth and debt service capacity of the borrower or of any pledged collateral.  These loans have a well-defined weakness or weaknesses which have clearly jeopardized repayment of principal and interest as originally intended.  They are characterized by the distinct possibility that the institution will sustain some future loss if the deficiencies are not corrected.

 

Doubtful:  Loans classified as doubtful have all the weaknesses inherent in those graded substandard, with the added characteristic that the severity of the weaknesses makes collection or liquidation in full highly questionable or improbable based upon currently existing facts, conditions, and values.

 

Furthermore, non-homogeneous loans which were not individually analyzed, but are 90+ days past due or on non-accrual are classified as substandard.  Loans included in homogeneous pools, such as residential or consumer, may be classified as substandard due to 90+ days delinquency, non-accrual status, bankruptcy, or loan restructuring.

 

Loans not meeting the criteria above that are analyzed individually as part of the above described process are considered to be pass rated loans.  Loans listed as not rated are either less than $50 thousand or are included in groups of homogeneous loans.  As of March 31, 2012 and December 31, 2011, and based on the most recent analysis performed, the risk category of loans by class of loans are as follows:

 

 

 

March 31, 2012

 

 

 

 

 

Special

 

 

 

 

 

 

 

 

 

(Dollar amounts in thousands)

 

Pass

 

Mention

 

Substandard

 

Doubtful

 

Not Rated

 

Total

 

Commercial

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial & Industrial

 

$

386,325

 

$

23,347

 

$

49,423

 

$

6,934

 

$

4,074

 

$

470,103

 

Farmland

 

86,164

 

2,962

 

2,953

 

—

 

645

 

92,724

 

Non Farm, Non Residential

 

255,134

 

26,252

 

31,794

 

914

 

704

 

314,798

 

Agriculture

 

89,859

 

2,429

 

961

 

—

 

96

 

93,345

 

All Other Commercial

 

83,126

 

2,650

 

7,392

 

791

 

1,309

 

95,268

 

Residential

 

 

 

 

 

 

 

 

 

 

 

 

 

First Liens

 

109,106

 

5,111

 

19,299

 

724

 

219,161

 

353,401

 

Home Equity

 

12,876

 

333

 

882

 

27

 

28,997

 

43,115

 

Junior Liens

 

12,023

 

553

 

941

 

74

 

26,676

 

40,267

 

Multifamily

 

41,170

 

3,870

 

2,982

 

3,198

 

293

 

51,513

 

All Other Residential

 

4,455

 

260

 

346

 

—

 

7,570

 

12,631

 

Consumer

 

 

 

 

 

 

 

 

 

 

 

 

 

Motor Vehicle

 

12,819

 

248

 

460

 

54

 

243,649

 

257,230

 

All Other Consumer

 

5,892

 

50

 

132

 

11

 

19,711

 

25,796

 

TOTAL

 

$

1,098,949

 

$

68,065

 

$

117,565

 

$

12,727

 

$

552,885

 

$

1,850,191

 

 

 

 

December 31, 2011

 

 

 

 

 

Special

 

 

 

 

 

 

 

 

 

(Dollar amounts in thousands)

 

Pass

 

Mention

 

Substandard

 

Doubtful

 

Not Rated

 

Total

 

Commercial

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial & Industrial

 

$

386,734

 

$

25,343

 

$

53,026

 

$

7,128

 

$

6,717

 

$

478,948

 

Farmland

 

89,213

 

4,250

 

3,015

 

69

 

619

 

97,166

 

Non Farm, Non Residential

 

254,761

 

28,684

 

32,704

 

4,271

 

393

 

320,813

 

Agriculture

 

109,869

 

2,100

 

623

 

79

 

122

 

112,793

 

All Other Commercial

 

77,330

 

6,097

 

5,099

 

67

 

1,011

 

89,604

 

Residential

 

 

 

 

 

 

 

 

 

 

 

 

 

First Liens

 

113,234

 

5,175

 

19,895

 

1,318

 

218,118

 

357,740

 

Home Equity

 

13,613

 

520

 

671

 

19

 

30,278

 

45,101

 

Junior Liens

 

11,887

 

714

 

783

 

968

 

27,105

 

41,457

 

Multifamily

 

35,837

 

3,911

 

6,224

 

606

 

258

 

46,836

 

All Other Residential

 

4,658

 

445

 

53

 

—

 

9,310

 

14,466

 

Consumer

 

 

 

 

 

 

 

 

 

 

 

 

 

Motor Vehicle

 

12,988

 

330

 

501

 

59

 

249,018

 

262,896

 

All Other Consumer

 

6,120

 

57

 

141

 

12

 

20,491

 

26,821

 

TOTAL

 

$

1,116,244

 

$

77,626

 

$

122,735

 

$

14,596

 

$

563,440

 

$

1,894,641